Revenue from Contracts with Customers

6 Months Ended

Jun. 27, 2020

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

Revenue from Contracts with Customers

Revenue recognition and accounts receivable

The Company recognizes revenues when it satisfies performance obligations as evidenced by the transfer of control of the promised goods to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods. The nature of the promised goods are ceramic, stone, carpet, resilient, laminate, wood and other flooring products. Payment is typically received 90 days or less from the invoice date. The Company adjusts the amounts of revenue for expected cash discounts, sales allowances, returns, and claims, based upon historical experience. The Company adjusts accounts receivable for doubtful account allowances based upon relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount, periodic evaluation of specific customer accounts, and the aging of accounts receivable. If the Company expects the financial condition of the Company’s customers to deteriorate based on current conditions or reasonable and supportable forecasts, additional allowances may be required.

Contract liabilities

The Company historically records contract liabilities when it receives payment prior to fulfilling a performance obligation. Contract liabilities related to revenues are recorded in accounts payable and accrued expenses on the accompanying condensed consolidating balance sheets. The Company had contract liabilities of $35,932 and $34,959 as of June 27, 2020 and December 31, 2019, respectively.

Performance obligations

Substantially all of the Company’s revenue is recognized at a point in time when the product is either shipped or received from the Company’s facilities and control of the product is transferred to the customer.  Accordingly, in any period, the Company does not recognize a significant amount of revenue from performance obligations satisfied or partially satisfied in prior periods and the amount of such revenue recognized during the three and six months ended June 27, 2020 was immaterial.

Costs to obtain a contract

The Company historically incurs certain incremental costs to obtain revenue contracts. These costs relate to marketing display structures and are capitalized when the amortization period is greater than one year, with the amount recorded in other assets on the accompanying condensed consolidated balance sheets. Capitalized costs to obtain contracts were $62,196 and $69,039 as of June 27, 2020 and December 31, 2019, respectively. Amortization expense recognized during the six months ended June 27, 2020 related to these capitalized costs was $34,754.

Practical expedients and policy elections

The Company elected the following practical expedients and policy elections:

•Incremental costs of obtaining a contract is recorded as an expense when incurred in selling, general and administrative expenses if the amortization period is less than one year.

•Shipping and handling activities performed after control has been transferred is accounted for as a fulfillment cost in cost of sales.

Revenue disaggregation

The following table presents the Company’s segment revenues disaggregated by the geographical market location of customer sales and product categories for the three months ended June 27, 2020 and June 29, 2019:

June 27, 2020	Global Ceramic segment		Flooring NA segment	Flooring ROW segment	Total
Geographical Markets
United States	$	472,538	777,778	376	1,250,692
Europe	146,647		842	352,356	499,845
Russia	55,216		—	22,234	77,450
Other	78,934		21,468	121,411	221,813
	$	753,335	800,088	496,377	2,049,800
Product Categories
Ceramic & Stone	$	751,735	7,403	—	759,138
Carpet & Resilient	1,600		615,754	163,279	780,633
Laminate & Wood	—		176,931	165,467	342,398
Other(1)	—		—	167,631	167,631
	$	753,335	800,088	496,377	2,049,800

June 29, 2019	Global Ceramic segment		Flooring NA segment	Flooring ROW segment	Total
Geographical Markets
United States	$	554,509	946,086	709	1,501,304
Europe	205,205		2,164	475,761	683,130
Russia	67,792		22	27,087	94,901
Other	130,525		35,167	139,458	305,150
	$	958,031	983,439	643,015	2,584,485
Product Categories
Ceramic & Stone	$	958,031	13,915	—	971,946
Carpet & Resilient	—		808,402	201,519	1,009,921
Laminate & Wood	—		161,122	215,058	376,180
Other(1)	—		—	226,438	226,438
	$	958,031	983,439	643,015	2,584,485

⁽¹⁾ Other includes roofing elements, insulation boards, chipboards and IP contracts.

The following table presents the Company’s segment revenues disaggregated by the geographical market location of customer sales and product categories for the six months ended June 27, 2020 and June 29, 2019:

June 27, 2020	Global Ceramic segment		Flooring NA segment	Flooring ROW segment	Total
Geographical Markets
United States	$	977,643	1,588,226	1,083	2,566,952
Europe	316,182		3,478	792,851	1,112,511
Russia	115,024		—	48,560	163,584
Other	192,936		56,714	242,866	492,516
	$	1,601,785	1,648,418	1,085,360	4,335,563
Product Categories
Ceramic & Stone	$	1,600,185	17,768	—	1,617,953
Carpet & Resilient	1,600		1,299,469	354,574	1,655,643
Laminate & Wood	—		331,181	364,276	695,457
Other (1)	—		—	366,510	366,510
	$	1,601,785	1,648,418	1,085,360	4,335,563

June 29, 2019	Global Ceramic segment		Flooring NA segment	Flooring ROW segment	Total
Geographical Markets
United States	$	1,096,335	1,829,328	777	2,926,440
Europe	384,515		4,001	945,678	1,334,194
Russia	119,707		52	50,701	170,460
Other	255,826		72,038	268,017	595,881
	$	1,856,383	1,905,419	1,265,173	5,026,975
Product Categories
Ceramic & Stone	$	1,856,383	28,358	—	1,884,741
Carpet & Resilient	—		1,543,826	392,448	1,936,274
Laminate & Wood	—		333,235	425,259	758,494
Other (1)	—		—	447,466	447,466
	$	1,856,383	1,905,419	1,265,173	5,026,975

⁽¹⁾ Other includes roofing elements, insulation boards, chipboards and IP contracts.