XML 32 R8.htm IDEA: XBRL DOCUMENT v3.21.2
REVENUE RECOGNITION
 9 Months Ended
Sep. 26, 2021
Revenue from Contract with Customer [Abstract]  
REVENUE RECOGNITION REVENUE RECOGNITION
The vast majority of the Company’s revenue is derived from contracts which are based upon a customer ordering our products. While there may be master agreements, the contract is only established when the customer’s order is accepted by the Company. The Company accounts for a contract, which may be verbal or written, when it is approved and committed by both parties, the rights of the parties are identified along with payment terms, the contract has commercial substance and collectability is probable.
The Company evaluates the transaction for distinct performance obligations, which are the sale of its products to customers. Since its products are commodity market-priced, the sales price is representative of the observable, standalone selling price. Each performance obligation is recognized based upon a pattern of recognition that reflects the transfer of control to the customer at a point in time, which is upon destination (customer location or port of destination), which faithfully depicts the transfer of control and recognition of revenue. There are instances of customer pick-up at the Company’s facility, in which case control transfers to the customer at that point and the Company recognizes revenue. The Company’s performance obligations are typically fulfilled within days to weeks of the acceptance of the order.
The Company makes judgments regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from revenue and cash flows with customers. Determination of a contract requires evaluation and judgment along with the estimation of the total contract value and if any of the contract value is constrained. Due to the nature of our business, there is minimal variable consideration, as the contract is established at the acceptance of the order from the customer. When applicable, variable consideration is estimated at contract inception and updated on a regular basis until the contract is completed. Allocating the transaction price to a specific performance obligation based upon the relative standalone selling prices includes estimating the standalone selling prices including discounts and variable consideration.
Disaggregated Revenue
Revenue has been disaggregated into the categories below to show how economic factors affect the nature, amount, timing and uncertainty of revenue and cash flows:
Three Months Ended September 26, 2021
(In thousands)
FreshPreparedExportOtherTotal
U.S. chicken$1,931,953 $235,763 $117,454 $181,680 $2,466,850 
U.K. and Europe chicken195,967 274,275 83,430 22,036 575,708 
Mexico chicken375,470 31,209 — 23,597 430,276 
Total chicken2,503,390 541,247 200,884 227,313 3,472,834 
U.K. and Europe pork52,265 269,563 21,012 11,892 354,732 
Total net sales$2,555,655 $810,810 $221,896 $239,205 $3,827,566 
Three Months Ended September 27, 2020
(In thousands)
FreshPreparedExportOtherTotal
U.S. chicken$1,590,003 $163,604 $58,871 $81,744 1,894,222 
U.K. and Europe chicken221,862 201,884 62,783 17,368 503,897 
Mexico chicken314,233 10,830 — 10,159 335,222 
Total chicken2,126,098 376,318 121,654 109,271 2,733,341 
U.K. and Europe pork176,667 125,963 18,378 20,772 341,780 
Total net sales$2,302,765 $502,281 $140,032 $130,043 $3,075,121 
Nine Months Ended September 26, 2021
(In thousands)
FreshPreparedExportOtherTotal
U.S. chicken$5,337,016 $637,344 $347,269 $393,250 $6,714,879 
U.K. and Europe chicken624,414 735,985 223,147 55,764 1,639,310 
Mexico chicken1,150,486 88,352 — 63,953 1,302,791 
Total chicken7,111,916 1,461,681 570,416 512,967 9,656,980 
U.K. and Europe pork290,673 709,743 55,489 25,804 1,081,709 
Total net sales$7,402,589 $2,171,424 $625,905 $538,771 $10,738,689 
Nine Months Ended September 27, 2020
(In thousands)
FreshPreparedExportOtherTotal
U.S. chicken$4,584,162 $535,960 $215,194 $284,475 $5,619,791 
U.K. and Europe chicken678,369 533,862 164,657 49,154 1,426,042 
Mexico chicken843,835 54,315 — 30,991 929,141 
Total chicken6,106,366 1,124,137 379,851 364,620 7,974,974 
U.K. and Europe pork509,663 382,500 52,521 54,414 999,098 
Total net sales$6,616,029 $1,506,637 $432,372 $419,034 $8,974,072 
Shipping and Handling Costs
In the rare case when shipping and handling activities are performed after a customer obtains control of the good, the Company has elected to account for shipping and handling as activities to fulfill the promise to transfer the good. When revenue
is recognized for the related good before the shipping and handling activities occur, the related costs of those shipping and handling activities are accrued. Shipping and handling costs are recorded within cost of sales.
Taxes
The Company excludes all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the entity from a customer (for example, sales, use, value added and some excise taxes) from the transaction price.
Contract Balances
The Company receives payment from customers based on terms established with the customer. Payments are typically due within two weeks of delivery. Revenue contract liabilities relate to payments received in advance of satisfying the performance under the customer contract. The revenue contract liability relates to customer prepayments and the advanced consideration, such as cash, received from governmental agency contracts for which performance obligations to the end customer have not been satisfied.
Changes in the revenue contract liabilities balance are as follows:
September 26, 2021
(In thousands)
Balance as of December 27, 2020$65,918 
Revenue recognized(57,494)
Cash received, excluding amounts recognized as revenue during the period12,140 
Balance as of September 26, 2021$20,564 
Accounts Receivable
The Company records accounts receivable when revenue is recognized. The Company records an allowance for doubtful accounts to reduce the receivables balance to an amount it estimates is collectible from customers. Estimates used in determining the allowance for doubtful accounts are based on historical collection experience, current trends, aging of accounts receivable and periodic credit evaluations of customers’ financial condition. The Company writes off accounts receivable when it becomes apparent, based upon age or customer circumstances, that such amounts will not be collected. Generally, the Company does not require collateral for its accounts receivable.