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Segment Reporting | 12 Months Ended
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Oct. 28, 2018
Segment Reporting [Abstract] |
Segment Reporting | 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 four segments: Grocery Products, Refrigerated Foods, Jennie-O Turkey Store, and International & Other. As a result of a business realignment at the beginning of fiscal 2018, the former Specialty Foods segment results are now reported as part of the Grocery Products segment. Periods presented herein have been recast to reflect this change. The Grocery Products segment consists primarily of the processing, marketing, and sale of shelf-stable food products sold predominantly in the retail market, along with the sale of nutritional and private label shelf-stable products to retail, foodservice, and industrial customers. 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, and poultry products for retail, foodservice, deli, and commercial customers. The Jennie-O Turkey Store segment consists primarily of the processing, marketing, and sale of branded and unbranded turkey products for retail, foodservice, and fresh product 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 and royalty arrangements. 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) |  | 2018 |  | 2017 |  | 2016
Net Sales (to unaffiliated customers) |  |  |  |  |  |
Grocery Products |  | $ | 2,521,992 |  |  | $ | 2,555,613 |  |  | $ | 2,623,890 |
Refrigerated Foods |  | 4,771,836 |  |  | 4,403,732 |  |  | 4,647,173 |
Jennie-O Turkey Store |  | 1,627,433 |  |  | 1,663,160 |  |  | 1,740,968 |
International & Other |  | 624,439 |  |  | 545,014 |  |  | 511,193 |
Total |  | $ | 9,545,700 |  |  | $ | 9,167,519 |  |  | $ | 9,523,224 |
Intersegment Sales |  |  |  |  |  |
Grocery Products |  | $ | 38 |  |  | $ | 32 |  |  | $ | 26 |
Refrigerated Foods |  | 8,591 |  |  | 7,832 |  |  | 11,341 |
Jennie-O Turkey Store |  | 110,753 |  |  | 113,384 |  |  | 120,742 |
International & Other |  | $ | — |  |  | — |  |  | — |
Total |  | 119,382 |  |  | 121,248 |  |  | 132,109 |
Intersegment elimination |  | (119,382 | ) |  | (121,248 | ) |  | (132,109 | )
Total |  | $ | — |  |  | $ | — |  |  | $ | — |
Segment Net Sales |  |  |  |  |  |
Grocery Products |  | $ | 2,522,030 |  |  | $ | 2,555,645 |  |  | $ | 2,623,916 |
Refrigerated Foods |  | 4,780,427 |  |  | 4,411,564 |  |  | 4,658,514 |
Jennie-O Turkey Store |  | 1,738,186 |  |  | 1,776,544 |  |  | 1,861,710 |
International & Other |  | 624,439 |  |  | 545,014 |  |  | 511,193 |
Intersegment elimination |  | (119,382 | ) |  | (121,248 | ) |  | (132,109 | )
Total |  | $ | 9,545,700 |  |  | $ | 9,167,519 |  |  | $ | 9,523,224 |
Segment Operating Profit |  |  |  |  |  |
Grocery Products |  | $ | 362,750 |  |  | $ | 387,637 |  |  | $ | 379,378 |
Refrigerated Foods |  | 617,626 |  |  | 587,929 |  |  | 585,652 |
Jennie-O Turkey Store |  | 175,684 |  |  | 247,322 |  |  | 329,427 |
International & Other |  | 88,953 |  |  | 85,304 |  |  | 78,409 |
Total segment operating profit |  | 1,245,013 |  |  | $ | 1,308,192 |  |  | $ | 1,372,866 |
Net interest and investment expense (income) |  | 17,637 |  |  | 1,824 |  |  | 6,680 |
General corporate expense |  | 46,534 |  |  | 28,091 |  |  | 49,436 |
Noncontrolling interest |  | 442 |  |  | 368 |  |  | 465 |
Earnings Before Income Taxes |  | $ | 1,181,284 |  |  | $ | 1,278,645 |  |  | $ | 1,317,215 |
Assets |  |  |  |  |  |  |  |  |
Grocery Products |  | $ | 2,205,396 |  |  | $ | 2,215,154 |  |  | $ | 2,277,913 |
Refrigerated Foods |  | 3,379,612 |  |  | 2,324,749 |  |  | 1,999,821 |
Jennie-O Turkey Store |  | 1,048,716 |  |  | 942,369 |  |  | 882,812 |
International & Other |  | 679,003 |  |  | 675,878 |  |  | 510,904 |
Corporate |  | 829,565 |  |  | 817,758 |  |  | 698,617 |
Total |  | $ | 8,142,292 |  |  | $ | 6,975,908 |  |  | $ | 6,370,067 |
Additions to Property, Plant & Equipment |  |  |  |  |  |
Grocery Products |  | $ | 13,042 |  |  | $ | 16,443 |  |  | $ | 21,202 |
Refrigerated Foods |  | 220,499 |  |  | 79,836 |  |  | 93,430 |
Jennie-O Turkey Store |  | 131,946 |  |  | 88,063 |  |  | 61,340 |
International & Other |  | 16,513 |  |  | 33,124 |  |  | 44,407 |
Corporate |  | 7,607 |  |  | 3,820 |  |  | 35,145 |
Total |  | $ | 389,607 |  |  | $ | 221,286 |  |  | $ | 255,524 |
Depreciation and Amortization |  |  |  |  |  |
Grocery Products |  | $ | 35,217 |  |  | $ | 37,096 |  |  | $ | 34,890 |
Refrigerated Foods |  | 70,564 |  |  | 45,911 |  |  | 53,229 |
Jennie-O Turkey Store |  | 33,324 |  |  | 31,611 |  |  | 29,225 |
International & Other |  | 10,755 |  |  | 4,042 |  |  | 3,969 |
Corporate |  | 11,998 |  |  | 12,317 |  |  | 10,655 |
Total |  | $ | 161,858 |  |  | $ | 130,977 |  |  | $ | 131,968 |
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 microwaveable 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 28, 2018 |  | October 29, 2017 |  | October 30, 2016
Perishable |  | 55.9 | % |  | 53.7 | % |  | 53.1 | %
Poultry |  | 19.3 | % |  | 19.1 | % |  | 20.5 | %
Shelf-stable |  | 18.5 | % |  | 20.2 | % |  | 18.2 | %
Miscellaneous |  | 6.3 | % |  | 7.0 | % |  | 8.2 | %
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
(in thousands) |  | October 28, 2018 |  | October 29, 2017 |  | October 30, 2016
United States |  | $ | 8,957,305 |  |  | $ | 8,631,325 |  |  | $ | 9,012,797 |
Foreign |  | 588,395 |  |  | 536,194 |  |  | 510,427 |
Total |  | $ | 9,545,700 |  |  | $ | 9,167,519 |  |  | $ | 9,523,224 |
In fiscal 2018, sales to Walmart Inc. (Walmart) represented $1.4 billion or 13.6% percent of the Company’s consolidated revenues (measured as gross sales less returns and allowances). In fiscal 2017, sales to Walmart represented $1.5 billion or 14.4% percent of the Company’s consolidated revenues. Walmart is a customer for all four 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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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