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Segment Reporting | 12 Months Ended
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Oct. 29, 2017
Segment Reporting |
Segment Reporting | Note P Segment Reporting The Company develops, processes, and distributes a wide array of food products in a variety of markets. The Company reports its results in the following five segments: Grocery Products, Refrigerated Foods, Jennie-O Turkey Store (JOTS), Specialty Foods, and International & Other. The Grocery Products segment consists primarily of the processing, marketing, and sale of shelf-stable food products sold predominantly in the retail market. This segment also includes the results from the Company’s MegaMex joint venture. The Refrigerated Foods segment consists primarily of the processing, marketing, and sale of branded and unbranded pork, beef, chicken, and turkey products for retail, foodservice, and fresh product customers. The JOTS segment consists primarily of the processing, marketing, and sale of branded and unbranded turkey products for retail, foodservice, and fresh product customers. The Specialty Foods segment consists of the processing, marketing, and sale of nutritional and private label shelf-stable products to retail, foodservice, and industrial customers. The International & Other segment includes Hormel Foods International which manufactures, markets, and sells Company products internationally. This segment also includes the results from the Company’s international joint ventures. Intersegment sales are recorded at prices that approximate cost and are eliminated in the Consolidated Statements of Operations. The Company does not allocate investment income, interest expense, and interest income to its segments when measuring performance. The Company also retains various other income and unallocated expenses at corporate. Equity in earnings of affiliates is included in segment operating profit; however, earnings attributable to the Company’s noncontrolling interests are excluded. These items are included below as net interest and investment expense (income), general corporate expense, and noncontrolling interest when reconciling to earnings before income taxes. Sales and operating profits for each of the Company’s reportable segments and reconciliation to earnings before income taxes are set forth below. The Company is an integrated enterprise, characterized by substantial intersegment cooperation, cost allocations, and sharing of assets. Therefore, the Company does not represent that these segments, if operated independently, would report the operating profit and other financial information shown below.
(in thousands) | 2017 | 2016 | 2015
Net Sales (to unaffiliated customers) |  |  |
Grocery Products | $ | 1,761,105 | $ | 1,684,756 | $ | 1,617,680
Refrigerated Foods | 4,403,732 | 4,647,173 | 4,372,347
Jennie-O Turkey Store | 1,663,160 | 1,740,968 | 1,635,776
Specialty Foods | 794,508 | 939,134 | 1,103,359
International & Other | 545,014 | 511,193 | 534,701
Total | $ | 9,167,519 | $ | 9,523,224 | $ | 9,263,863
Intersegment Sales |  |  |
Grocery Products | $ | – | $ | – | $ | –
Refrigerated Foods | 7,832 | 11,341 | 13,058
Jennie-O Turkey Store | 113,384 | 120,742 | 128,195
Specialty Foods | 32 | 26 | 64
International & Other | – | – | –
Total | 121,248 | 132,109 | 141,317
Intersegment elimination | (121,248) | (132,109) | (141,317)
Total | $ | – | $ | – | $ | –
Segment Net Sales |  |  |
Grocery Products | $ | 1,761,105 | $ | 1,684,756 | $ | 1,617,680
Refrigerated Foods | 4,411,564 | 4,658,514 | 4,385,405
Jennie-O Turkey Store | 1,776,544 | 1,861,710 | 1,763,971
Specialty Foods | 794,540 | 939,160 | 1,103,423
International & Other | 545,014 | 511,193 | 534,701
Intersegment elimination | (121,248) | (132,109) | (141,317)
Total | $ | 9,167,519 | $ | 9,523,224 | $ | 9,263,863
Segment Operating |  |  |
Profit |  |  |
Grocery Products | $ | 290,809 | $ | 268,461 | $ | 228,582
Refrigerated Foods | 587,929 | 585,652 | 424,968
Jennie-O Turkey Store | 247,322 | 329,427 | 276,217
Specialty Foods | 96,828 | 110,917 | 93,258
International & Other | 85,304 | 78,409 | 78,318
Total segment operating profit | $ | 1,308,192 | $ | 1,372,866 | $ | 1,101,343
Net interest and investment expense (income) | 1,824 | 6,680 | 10,177
General corporate expense | 28,091 | 49,436 | 35,199
Noncontrolling interest | 368 | 465 | 1,176
Earnings Before Income Taxes | $ | 1,278,645 | $ | 1,317,215 | $ | 1,057,143
(in thousands) | 2017 | 2016 | 2015
Assets |  |  |
Grocery Products | $ | 1,445,658 | $ | 1,472,316 | $ | 1,214,988
Refrigerated Foods | 2,324,749 | 1,999,821 | 1,973,424
Jennie-O Turkey Store | 942,369 | 882,812 | 811,693
Specialty Foods | 769,496 | 805,597 | 956,945
International & Other | 675,878 | 510,904 | 477,674
Corporate | 817,758 | 698,617 | 705,107
Total | $ | 6,975,908 | $ | 6,370,067 | $ | 6,139,831
Additions to Property, |  |  |
Plant and Equipment |  |  |
Grocery Products | $ | 14,432 | $ | 15,830 | $ | 18,104
Refrigerated Foods | 79,836 | 93,430 | 54,074
Jennie-O Turkey Store | 88,063 | 61,340 | 32,250
Specialty Foods | 2,011 | 5,372 | 5,309
International & Other | 33,124 | 44,407 | 18,576
Corporate | 3,820 | 35,145 | 15,750
Total | $ | 221,286 | $ | 255,524 | $ | 144,063
Depreciation and |  |  |
Amortization |  |  |
Grocery Products | $ | 31,739 | $ | 29,725 | $ | 26,972
Refrigerated Foods | 45,911 | 53,229 | 53,325
Jennie-O Turkey Store | 31,611 | 29,225 | 28,262
Specialty Foods | 5,357 | 5,165 | 11,075
International & Other | 4,042 | 3,969 | 3,372
Corporate | 12,317 | 10,655 | 10,428
Total | $ | 130,977 | $ | 131,968 | $ | 133,434
The Company’s products primarily consist of meat and other food products. Perishable includes fresh meats, frozen items, refrigerated meal solutions, sausages, hams, guacamole, and bacon (excluding JOTS products). Shelf-stable includes canned luncheon meats, peanut butter, chilies, shelf-stable microwave-able meals, hash, stews, meat spreads, flour and corn tortillas, salsas, tortilla chips, and other items that do not require refrigeration. The Poultry category is composed primarily of JOTS products. The Miscellaneous category primarily consists of nutritional food products and supplements, dessert and drink mixes, and industrial gelatin products. The percentages of total revenues contributed by classes of similar products for the last three fiscal years are as follows:
| Fiscal Year Ended
| October 29, | October 30, | October 25,
| 2017 | 2016 | 2015
Perishable | 53.7% | 53.1% | 53.0%
Shelf-stable | 20.2 | 18.2 | 18.4
Poultry | 19.1 | 20.5 | 18.6
Miscellaneous | 7.0 | 8.2 | 10.0
Total | 100.0% | 100.0% | 100.0%
Revenues from external customers are classified as domestic or foreign based on the destination where title passes. No individual foreign country is material to the consolidated results. Additionally, the Company’s long-lived assets located in foreign countries are not significant. Total revenues attributed to the U.S. and all foreign countries in total for the last three fiscal years are as follows:
| Fiscal Year Ended
| October 29, | October 30, | October 25,
(in thousands) | 2017 | 2016 | 2015
United States | $ 8,631,325 | $ 9,012,797 | $ 8,721,722
Foreign | 536,194 | 510,427 | 542,141
Total | $ 9,167,519 | $ 9,523,224 | $ 9,263,863
In fiscal 2017, sales to Wal-Mart Stores, Inc. (Wal-Mart) represented $1.5 billion or 14.4 percent of the Company’s consolidated revenues (measured as gross sales less returns and allowances). In fiscal 2016, sales to Wal-Mart represented $1.5 billion or 13.7 percent of the Company’s consolidated revenues. Wal-Mart is a customer for all five segments of the Company.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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