SANFILIPPO JOHN B & SON INC, 10-Q filed on 03 May 18
v3.8.0.1
Document and Entity Information - shares
9 Months Ended
Mar. 29, 2018
Apr. 19, 2018
Document Information [Line Items]    
Document Type 10-Q  
Amendment Flag false  
Document Period End Date Mar. 29, 2018  
Document Fiscal Year Focus 2018  
Document Fiscal Period Focus Q3  
Trading Symbol JBSS  
Entity Registrant Name SANFILIPPO JOHN B & SON INC  
Entity Central Index Key 0000880117  
Current Fiscal Year End Date --06-28  
Entity Filer Category Accelerated Filer  
Common Stock, Non-Cumulative Voting Rights of One Vote Per Share [Member]    
Document Information [Line Items]    
Entity Common Stock, Shares Outstanding   8,747,575
Class A Common Stock [Member]    
Document Information [Line Items]    
Entity Common Stock, Shares Outstanding   2,597,426
v3.8.0.1
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Mar. 29, 2018
Mar. 30, 2017
Mar. 29, 2018
Mar. 30, 2017
Statement of Comprehensive Income [Abstract]        
Net sales $ 203,181 $ 173,376 $ 677,090 $ 645,044
Cost of sales 169,995 144,950 571,184 536,754
Gross profit 33,186 28,426 105,906 108,290
Operating expenses:        
Selling expenses 11,626 10,299 38,415 36,940
Administrative expenses 7,457 7,163 21,803 23,022
Total operating expenses 19,083 17,462 60,218 59,962
Income from operations 14,103 10,964 45,688 48,328
Other expense:        
Interest expense including $340, $198, $779 and $589 to related parties 1,004 864 2,590 2,094
Rental and miscellaneous expense, net 329 367 1,192 1,076
Other expense 492 534 1,477 1,600
Total other expense, net 1,825 1,765 5,259 4,770
Income before income taxes 12,278 9,199 40,429 43,558
Income tax expense 3,647 2,863 13,610 14,157
Net income 8,631 6,336 26,819 29,401
Other comprehensive income:        
Amortization of prior service cost and actuarial loss included in net periodic pension cost 279 331 839 992
Income tax expense related to pension adjustments (69) (126) (288) (377)
Other comprehensive income, net of tax 210 205 551 615
Comprehensive income $ 8,841 $ 6,541 $ 27,370 $ 30,016
Net income per common share-basic $ 0.76 $ 0.56 $ 2.36 $ 2.60
Net income per common share-diluted $ 0.75 $ 0.55 2.34 2.58
Cash dividends declared per share     $ 2.50 $ 5.00
v3.8.0.1
Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Mar. 29, 2018
Mar. 30, 2017
Mar. 29, 2018
Mar. 30, 2017
Statement of Comprehensive Income [Abstract]        
Interest expense to related parties $ 340 $ 198 $ 779 $ 589
v3.8.0.1
Consolidated Balance Sheets (Unaudited) - USD ($)
$ in Thousands
Mar. 29, 2018
Jun. 29, 2017
Mar. 30, 2017
CURRENT ASSETS:      
Cash $ 1,013 $ 1,955 $ 1,848
Accounts receivable, less allowance for doubtful accounts of $286, $263 and $232 65,129 64,830 59,402
Inventories 184,882 182,420 201,398
Prepaid expenses and other current assets 7,395 4,172 4,625
TOTAL CURRENT ASSETS 258,419 253,377 267,273
PROPERTY, PLANT AND EQUIPMENT:      
Land 9,285 9,285 9,285
Buildings 108,148 107,015 106,566
Machinery and equipment 198,990 194,099 195,293
Furniture and leasehold improvements 4,970 4,842 4,807
Vehicles 535 498 453
Construction in progress 1,757 1,075 1,241
Property, plant and equipment gross 323,685 316,814 317,645
Less: Accumulated depreciation 217,135 210,606 209,864
Property, plant and equipment net 106,550 106,208 107,781
Rental investment property, less accumulated depreciation of $10,233, $9,639 and $9,441 18,660 19,254 19,453
TOTAL PROPERTY, PLANT AND EQUIPMENT 125,210 125,462 127,234
Cash surrender value of officers' life insurance and other assets 8,846 10,125 9,683
Deferred income taxes 5,579 9,095 7,894
Goodwill 9,650    
Intangible assets, net 18,499   233
TOTAL ASSETS 426,203 398,059 412,317
CURRENT LIABILITIES:      
Revolving credit facility borrowings 56,579 29,456 61,337
Current maturities of long-term debt, including related party debt of $4,332, $474 and $465 and net of unamortized debt issuance costs of $47, $55 and $58 7,128 3,418 3,408
Accounts payable, including related party payables of $0, $178 and $186 48,075 50,047 40,173
Bank overdraft 3,520 932 2,979
Accrued payroll and related benefits 7,530 15,958 13,387
Other accrued expenses 9,552 10,062 8,910
TOTAL CURRENT LIABILITIES 132,384 109,873 130,194
LONG-TERM LIABILITIES:      
Long-term debt, less current maturities, including related party debt of $16,596, $10,584 and $10,706 and net of unamortized debt issuance costs of $89, $124 and $136 29,164 25,211 26,069
Retirement plan 21,597 20,994 22,729
Other 7,025 6,513 6,527
TOTAL LONG-TERM LIABILITIES 57,786 52,718 55,325
TOTAL LIABILITIES 190,170 162,591 185,519
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:      
Capital in excess of par value 119,336 117,772 117,232
Retained earnings 121,639 123,190 116,466
Accumulated other comprehensive loss (3,853) (4,404) (5,810)
Treasury stock, at cost; 117,900 shares of Common Stock (1,204) (1,204) (1,204)
TOTAL STOCKHOLDERS' EQUITY 236,033 235,468 226,798
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY 426,203 398,059 412,317
Class A Common Stock [Member]      
STOCKHOLDERS' EQUITY:      
Common Stock 26 26 26
Common Stock, Non-Cumulative Voting Rights of One Vote Per Share [Member]      
STOCKHOLDERS' EQUITY:      
Common Stock $ 89 $ 88 $ 88
v3.8.0.1
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($)
$ in Thousands
Mar. 29, 2018
Jun. 29, 2017
Mar. 30, 2017
Allowance for doubtful accounts for accounts receivable, current $ 286 $ 263 $ 232
Accumulated depreciation of rental investment property 10,233 9,639 9,441
Current maturities of long-term debt, related party debt 4,332 474 465
Unamortized debt issuance costs, current 47 55 58
Accounts payable, related party payables 0 178 186
Related party debt, Non-current 16,596 10,584 10,706
Unamortized debt issuance costs, noncurrent $ 89 $ 124 $ 136
Treasury stock, shares 117,900 117,900 117,900
Class A Common Stock [Member]      
Common stock, par value $ 0.01 $ 0.01 $ 0.01
Common stock, shares authorized 10,000,000 10,000,000 10,000,000
Common stock, shares issued 2,597,426 2,597,426 2,597,426
Common stock, shares outstanding 2,597,426 2,597,426 2,597,426
Common Stock, Non-Cumulative Voting Rights of One Vote Per Share [Member]      
Common stock, par value $ 0.01 $ 0.01 $ 0.01
Common stock, shares authorized 17,000,000 17,000,000 17,000,000
Common stock, shares issued 8,865,475 8,801,641 8,801,641
v3.8.0.1
Consolidated Statements of Cash Flows (Unaudited) - USD ($)
$ in Thousands
9 Months Ended
Mar. 29, 2018
Mar. 30, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net income $ 26,819 $ 29,401
Depreciation and amortization 11,231 11,909
Loss on disposition of assets, net 414 57
Deferred income tax expense 3,516 696
Stock-based compensation expense 2,180 1,964
Change in assets and liabilities, net of business acquired:    
Accounts receivable, net 2,048 18,671
Inventories (505) (44,825)
Prepaid expenses and other current assets (2,353) (252)
Accounts payable (2,619) (3,580)
Accrued expenses (7,860) (1,581)
Income taxes payable (2,130) 1,559
Other long-term assets and liabilities 999 89
Other, net 1,325 1,247
Net cash provided by operating activities 33,065 15,355
CASH FLOWS FROM INVESTING ACTIVITIES:    
Purchases of property, plant and equipment (9,060) (8,228)
Acquisition of Squirrel Brand L.P. (21,727)  
Other (66) 100
Net cash used in investing activities (30,853) (8,128)
CASH FLOWS FROM FINANCING ACTIVITIES:    
Borrowings under revolving credit facility 351,163 278,310
Repayments of revolving credit borrowings (324,040) (229,057)
Principal payments on long-term debt (3,880) (2,619)
Increase in bank overdraft 2,588 2,168
Dividends paid (28,370) (56,464)
Issuance of Common Stock under equity award plans 16 63
Taxes paid related to net share settlement of equity awards (631)  
Net cash used in financing activities (3,154) (7,599)
NET DECREASE IN CASH (942) (372)
Cash, beginning of period 1,955 2,220
Cash, end of period 1,013 $ 1,848
Supplemental disclosure of non-cash investing activities:    
Acquisition of Squirrel Brand L.P. through note payable $ 11,500  
v3.8.0.1
Basis of Presentation and Description of Business
9 Months Ended
Mar. 29, 2018
Accounting Policies [Abstract]  
Basis of Presentation and Description of Business

Note 1 – Basis of Presentation and Description of Business

As used herein, unless the context otherwise indicates, the terms “we”, “us”, “our” or “Company” collectively refer to John B. Sanfilippo & Son, Inc. and our wholly-owned subsidiary, JBSS Ventures, LLC. Our fiscal year ends on the final Thursday of June each year, and typically consists of fifty-two weeks (four thirteen-week quarters). Additional information on the comparability of the periods presented is as follows:

 

    References herein to fiscal 2018 and fiscal 2017 are to the fiscal year ending June 28, 2018 and the fiscal year ended June 29, 2017, respectively.

 

    References herein to the third quarter of fiscal 2018 and fiscal 2017 are to the quarters ended March 29, 2018 and March 30, 2017, respectively.

 

    References herein to the first three quarters or first thirty-nine weeks of fiscal 2018 and fiscal 2017 are to the thirty-nine weeks ended March 29, 2018 and March 30, 2017, respectively.

We are one of the leading processors and distributors of peanuts, pecans, cashews, walnuts, almonds, and other nuts in the United States. These nuts are sold under a variety of private brands and under the Fisher, Orchard Valley Harvest, Squirrel Brand, Southern Style Nuts, and Sunshine Country brand names. We also market and distribute, and in most cases, manufacture or process, a diverse product line of food and snack products, including peanut butter, almond butter, cashew butter, candy and confections, snacks and trail mixes, snack bites, sunflower kernels, dried fruit, corn snacks, sesame sticks and other sesame snack products under private brands and brand names. Our products are sold through three primary distribution channels to significant buyers of nuts, including food retailers in the consumer channel, commercial ingredient users and contract packaging customers.

The accompanying unaudited financial statements fairly present the consolidated statements of comprehensive income, consolidated balance sheets and consolidated statements of cash flows, and reflect all adjustments, consisting only of normal recurring adjustments which are necessary for the fair statement of the results of the interim periods. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses.

The interim results of operations are not necessarily indicative of the results to be expected for a full year. The balance sheet data as of June 29, 2017 was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”). Accordingly, these unaudited financial statements and related notes should be read in conjunction with the audited consolidated financial statements and notes thereto included in our 2017 Annual Report on Form 10-K for the fiscal year ended June 29, 2017.

v3.8.0.1
Inventories
9 Months Ended
Mar. 29, 2018
Inventory Disclosure [Abstract]  
Inventories

Note 2 – Inventories

Inventories consist of the following:

 

     March 29,
2018
     June 29,
2017
     March 30,
2017
 

Raw material and supplies

   $ 103,332      $ 79,609      $ 112,978  

Work-in-process and finished goods

     81,550        102,811        88,420  
  

 

 

    

 

 

    

 

 

 

Total

   $ 184,882      $ 182,420      $ 201,398  
  

 

 

    

 

 

    

 

 

 
v3.8.0.1
Acquisition of Squirrel Brand L.P.
9 Months Ended
Mar. 29, 2018
Business Combinations [Abstract]  
Acquisition of Squirrel Brand L.P.

Note 3 – Acquisition of Squirrel Brand L.P.

On November 30, 2017, we acquired certain assets and assumed certain liabilities (the “Acquisition”) of Squirrel Brand L.P. (“Squirrel Brand”) for a purchase price of $31,500, subject to a working capital adjustment. After giving effect to the initial and final working capital adjustments, the purchase price was $33,227, of which a net cash payment of $21,727 was made and $11,500 was financed by the seller through a three-year unsecured promissory note (the “Promissory Note”). The cash portion of the acquisition price was funded from our Credit Facility. The Promissory Note bears interest at 5.5% per annum and is payable in equal monthly principal payments of $319, plus interest, which began in January 2018. The Promissory Note can be prepaid without penalty.

The Squirrel Brand business is one of the nation’s leading suppliers of indulgent and premium roasted nuts and snack mixes under its Squirrel Brand and Southern Style Nuts brands. Prior to the Acquisition, Squirrel Brand was a customer in our Contract Packaging sales channel for fourteen years. The Acquisition has been accounted for as a business combination in accordance with ASC Topic 805, “Business Combinations”. As a result of the Acquisition, we expanded our customer base and branded product portfolio, as well as increased our customer reach, especially into alternative distribution channels.

The total purchase price of $33,227 has been allocated on a preliminary basis to the fair values of the assets acquired and liabilities assumed as follows:

 

Accounts receivable

   $ 2,362  

Inventories

     1,957  

Other assets

     63  

Identifiable intangible assets:

  

Customer relationships

     10,500  

Brand names

     8,900  

Non-compete agreement

     270  

Goodwill

     9,650  

Accounts payable and accrued expenses

     (475
  

 

 

 

Total Purchase Price

   $ 33,227  
  

 

 

 

The customer relationship assets represent the value of the long-term strategic relationship the Squirrel Brand business has with its significant customers, which we are amortizing over a weighted-average life of 7.5 years. The assets were valued using an income approach, specifically the “multi-period excess earnings” method, which identifies an estimated stream of revenues and expenses for a particular group of assets from which deductions of portions of the projected economic benefits, attributable to assets other than the subject asset (contributory assets), are deducted in order to isolate the prospective earnings of the subject asset. This value is considered a level 3 measurement under the GAAP fair value hierarchy.

The brand name assets represent the value of the established Squirrel Brand and Southern Style Nuts names. We applied the income approach through a relief from royalty method analysis to determine the preliminary fair value of the brand name assets. We are amortizing the brand name assets over a weighted-average life of 13.8 years.

Goodwill, which is expected to be deductible for income tax purposes, arises from intangible assets that do not qualify for separate recognition and expected synergies from combining the operations of Squirrel Brand with the Company. There were no material contingencies recognized or unrecognized associated with the acquired business.

The purchase price allocation, especially amounts allocated to goodwill and identifiable intangible assets are based on preliminary valuations and are subject to final adjustments.

 

The following reflects the unaudited pro forma results of operations of the Company as if the Acquisition had taken place at the beginning of fiscal 2017. This pro forma information does not purport to represent what the Company’s actual results would have been if the Acquisition had occurred as of the date indicated or what such results would be for any future periods.

 

     Year-Ended
June 29, 2017
     Thirty-Nine
weeks ended
March 29, 2018
 

Pro forma net sales

   $ 863,267      $ 682,235  

Pro forma net income

     36,723        27,393  

Pro forma diluted earnings per share

   $ 3.22      $ 2.39  

These unaudited pro forma results have been calculated after applying our accounting policies and adjusting the results of the Squirrel Brand business to reflect elimination of transaction costs and to record additional amortization and interest expense that would have been charged, assuming the fair value adjustment to intangible assets since July 1, 2016, net of related income taxes in respect of pro forma net income and diluted earnings per share performance. Transaction costs of $500, already recorded in Administrative expenses, are excluded from the pro forma net income for the thirty-nine weeks ended March 29, 2018 stated above.

Net sales of approximately $15,065 since the Acquisition closed on November 30, 2017 are included in our consolidated financial results as of March 29, 2018.

Since the Acquisition, we continue to operate in a single reportable operating segment that consists of selling various nut and nut-related products through three sales distribution channels.

v3.8.0.1
Goodwill and Intangible Assets
9 Months Ended
Mar. 29, 2018
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets

Note 4 – Goodwill and Intangible Assets

Identifiable intangible assets that are subject to amortization, which resulted entirely from the Acquisition, are based on our preliminary purchase price allocation and consist of the following at March 29, 2018:

 

     March 29,
2018
     Weighted-average
amortization
period (years)
 

Customer relationships

   $ 10,500        7.5  

Brand names

     8,900        13.8  

Non-compete agreement

     270        5.0  
  

 

 

    

 

 

 
     19,670        11.3  

Less accumulated amortization:

     

Customer relationships

     (923   

Brand names

     (230   

Non-compete agreement

     (18   
  

 

 

    
     (1,171   
  

 

 

    

Net intangible assets

   $ 18,499     
  

 

 

    

Gross intangible assets of $18,690 from previous acquisitions were fully amortized as of June 29, 2017.

Customer relationships are being amortized on an accelerated basis. The brand names consist of the Squirrel Brand and Southern Style Nuts brand names.

 

Total amortization expense related to intangible assets, which is a component of Administrative expense, was $842 and $1,171 for the quarter and thirty-nine weeks ended March 29, 2018, respectively. Amortization expense for the remainder of fiscal 2018, based on our preliminary purchase price allocation, is expected to be approximately $843 and expected amortization expense the next five fiscal years is as follows:

 

Fiscal year ending

      

June 27, 2019

   $ 3,028  

June 25, 2020

     2,500  

June 24, 2021

     2,162  

June 30, 2022

     1,894  

June 29, 2023

     1,659  

Our net goodwill of $9,650 relates entirely to the Acquisition. The changes in the carrying amount of goodwill during the thirty-nine weeks ended March 29, 2018 are as follows:

 

Net balance at June 29, 2017

   $ —    

Goodwill acquired during fiscal 2018

     9,650  
  

 

 

 

Net balance at March 29, 2018

   $ 9,650  
  

 

 

 

The Company will perform a goodwill impairment test annually during the fourth quarter of its fiscal year and more frequently if events or circumstances indicate that impairment may have occurred. Such events or circumstances may, among others, include significant adverse changes in the general business climate.

v3.8.0.1
Credit Facility
9 Months Ended
Mar. 29, 2018
Debt Disclosure [Abstract]  
Credit Facility

Note 5 – Credit Facility

On July 7, 2017, we entered into the Eighth Amendment to our Credit Facility which eliminated the quarterly restriction on cash dividends and distributions and allows the Company to, without obtaining lender consent, make up to four cash dividends or distributions on our stock per fiscal year, or purchase, acquire, redeem or retire stock in any fiscal year, in an amount not to exceed $60,000 in the aggregate per fiscal year, as long as no default or event of default exists and the excess availability under the Credit Facility remains over $30,000 immediately before and after giving effect to any such dividend, distribution, purchase or redemption.

On November 29, 2017, we entered into the Consent and Ninth Amendment to our Credit Agreement (the “Ninth Amendment”). The Ninth Amendment provides lender consent for us to incur unsecured debt (in particular, the Promissory Note) in connection with our acquisition of the Squirrel Brand business, and for: (i) the incurrence of unsecured debt in connection with the Acquisition and (ii) the Acquisition to constitute a “Permitted Acquisition” under the terms of the Credit Agreement. The Ninth Amendment also modified our collateral reporting requirements.

At March 29, 2018, we had $57,671 of available credit under the Credit Facility which reflects borrowings of $56,579 and reduced availability as a result of $3,250 in outstanding letters of credit. As of March 29, 2018, we were in compliance with all financial covenants under the Credit Facility and Mortgage Facility.

v3.8.0.1
Earnings Per Common Share
9 Months Ended
Mar. 29, 2018
Earnings Per Share [Abstract]  
Earnings Per Common Share

Note 6 – Earnings Per Common Share

The following table presents the reconciliation of the weighted average shares outstanding used in computing basic and diluted earnings per share:

 

     For the Quarter Ended      For the Thirty-Nine Weeks
Ended
 
     March 29,
2018
     March 30,
2017
     March 29,
2018
     March 30,
2017
 

Weighted average number of shares outstanding – basic

     11,399,492        11,347,920        11,375,437        11,306,251  

Effect of dilutive securities:

     

Stock options and restricted stock units

     54,056        76,878        65,234        86,652  
  

 

 

    

 

 

    

 

 

    

 

 

 

Weighted average number of shares outstanding – diluted

     11,453,548        11,424,798        11,440,671        11,392,903  
  

 

 

    

 

 

    

 

 

    

 

 

 

There were no anti-dilutive awards excluded from the computation of diluted earnings per share for the current quarter and thirty-nine week periods presented.

v3.8.0.1
Stock-Based Compensation Plans
9 Months Ended
Mar. 29, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-Based Compensation Plans

Note 7 – Stock-Based Compensation Plans

The following is a summary of restricted stock unit (“RSU”) activity for the first thirty-nine weeks of fiscal 2018:

 

Restricted Stock Units

   Shares      Weighted
Average Grant
Date Fair Value
 

Outstanding at June 29, 2017

     201,858      $ 40.36  

Activity:

     

Granted

     60,582        54.41  

Vested (a)

     (73,372      36.52  

Forfeited

     —          —    
  

 

 

    

 

 

 

Outstanding at March 29, 2018

     189,068      $ 46.35  
  

 

 

    

 

 

 

 

(a)  The number of RSUs vested includes shares that were withheld on behalf of employees to satisfy the statutory tax withholding requirements.

At March 29, 2018, there are 61,008 RSUs outstanding that are vested but deferred.

The following table summarizes compensation expense charged to earnings for all equity compensation plans for the periods presented:

 

     For the Quarter Ended      For the Thirty-Nine
Weeks Ended
 
     March 29,
2018
     March 30,
2017
     March 29,
2018
     March 30,
2017
 

Stock-based compensation expense

   $ 751      $ 536      $ 2,180      $ 1,964  

As of March 29, 2018, there was $4,124 of total unrecognized compensation expense related to non-vested RSUs granted under our stock-based compensation plans. We expect to recognize that cost over a weighted average period of 1.7 years.

Stock option activity was insignificant during the first thirty-nine weeks of fiscal 2018.

v3.8.0.1
Dividends
9 Months Ended
Mar. 29, 2018
Text Block [Abstract]  
Dividends

Note 8 – Dividends

On July 11, 2017, our Board of Directors, after considering the financial position of our Company and other factors, declared a special cash dividend of $2.00 per share and a regular annual cash dividend of $0.50 per share on all issued and outstanding shares of Common Stock and Class A Stock of the Company (the “July 2017 Dividends”). The July 2017 Dividends of approximately $28,370 were paid on August 15, 2017 to stockholders of record as of the close of business on August 2, 2017.

v3.8.0.1
Retirement Plan
9 Months Ended
Mar. 29, 2018
Retirement Benefits [Abstract]  
Retirement Plan

Note 9 – Retirement Plan

The Supplemental Employee Retirement Plan is an unfunded, non-qualified benefit plan that will provide eligible participants with monthly benefits upon retirement, disability or death, subject to certain conditions. The monthly benefit is based upon each participant’s earnings and his or her number of years of service. The components of net periodic benefit cost are as follows:

 

     For the Quarter Ended      For the Thirty-Nine
Weeks Ended
 
     March 29,
2018
     March 30,
2017
     March 29,
2018
     March 30,
2017
 

Service cost

   $ 152      $ 157      $ 456      $ 473  

Interest cost

     213        203        638        608  

Amortization of prior service cost

     239        239        718        718  

Amortization of loss

     40        92        121        274  
  

 

 

    

 

 

    

 

 

    

 

 

 

Net periodic benefit cost

   $ 644      $ 691      $ 1,933      $ 2,073  
  

 

 

    

 

 

    

 

 

    

 

 

 

The components of net periodic benefit cost other than the service cost component are included in the line item “Other expense” in the Consolidated Statements of Comprehensive Income.

v3.8.0.1
Accumulated Other Comprehensive Loss
9 Months Ended
Mar. 29, 2018
Equity [Abstract]  
Accumulated Other Comprehensive Loss

Note 10 – Accumulated Other Comprehensive Loss

The table below sets forth the changes to accumulated other comprehensive loss (“AOCL”) for the thirty-nine weeks ended March 29, 2018 and March 30, 2017. These changes are all related to our defined benefit pension plan.

 

Changes to AOCL (a)    For the Thirty-Nine
Weeks Ended
 
   March 29,
2018
     March 30,
2017
 

Balance at beginning of period

   $ (4,404    $ (6,425

Other comprehensive income before reclassifications

     —          —    

Amounts reclassified from accumulated other comprehensive loss

     839        992  

Tax effect

     (288      (377
  

 

 

    

 

 

 

Net current-period other comprehensive income

     551        615  
  

 

 

    

 

 

 

Balance at end of period

   $ (3,853    $ (5,810
  

 

 

    

 

 

 

 

(a)  Amounts in parenthesis indicate debits/expense.

 

The reclassifications out of AOCL for the quarter and thirty-nine weeks ended March 29, 2018 and March 30, 2017 were as follows:

 

                            

Affected line

item in

the Consolidated
Statements of
Comprehensive
Income

Reclassifications from AOCL to earnings (b)    For the Quarter Ended     For the Thirty-Nine
Weeks Ended
   
   March 29,
2018
    March 30,
2017
    March 29,
2018
    March 30,
2017
   

Amortization of defined benefit pension items:

          

Unrecognized prior service cost

   $ (239   $ (239   $ (718   $ (718   Other expense

Unrecognized net loss

     (40     (92     (121     (274   Other expense
  

 

 

   

 

 

   

 

 

   

 

 

   

Total before tax

     (279     (331     (839     (992  

Tax effect

     69       126       288       377     Income tax expense
  

 

 

   

 

 

     

 

 

   

Amortization of defined pension items, net of tax

   $ (210   $ (205   $ (551   $ (615  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

(b)  Amounts in parenthesis indicate debits to expense. See Note 9 – “Retirement Plan” above for additional details.
v3.8.0.1
Income Taxes
9 Months Ended
Mar. 29, 2018
Income Tax Disclosure [Abstract]  
Income Taxes

Note 11 – Income Taxes

Income tax expense as a percent of pre-tax income (the “Effective Tax Rate”) for the quarter ended March 29, 2018 was 29.7% compared to an Effective Tax Rate of 31.1% for the quarter ended March 30, 2017. The Effective Tax Rate for the thirty-nine weeks ended March 29, 2018 was 33.7% compared to an Effective Tax Rate of 32.5% for the thirty-nine weeks ended March 30, 2017. The increase in the Effective Tax Rate for the thirty-nine weeks ended March 29, 2018 was primarily related to the re-measurement of our net deferred tax assets incorporating the new federal income tax rate.

H.R.1, originally known as the Tax Cuts and Jobs Act of 2017, was enacted on December 22, 2017, and includes, among other items, a reduction in the federal corporate income tax rate from 35% to 21%, which will have a material favorable impact on our effective income tax rate and cash income taxes paid going forward. Because we have a June fiscal year-end, the lower corporate income tax rate will be phased in during the 2018 calendar year, resulting in a U.S. statutory federal rate of approximately 28% for our fiscal year ending June 28, 2018, and 21% for subsequent fiscal years. Our net deferred tax asset balances are recorded at the tax rate expected to be in effect during the period in which the related temporary differences reverse. Therefore, this reduction in the corporate federal income tax rate required a non-cash reduction of our net deferred tax asset balances and a corresponding increase in income tax expense of $2,480 during the thirty-nine weeks ended March 29, 2018. We scheduled out the expected reversal of temporary differences, including anticipated changes in our pension accrual and fixed asset acquisitions for the next three months, which required the use of reasonable estimates. Actual results could differ from those estimates, and thus further adjustment of our deferred tax asset balances are possible.

Windfall tax benefits related to the excess tax deduction of share-based compensation of $512 for the thirty-nine weeks ended March 29, 2018 partially offset the impact of the reduction of the corporate tax rate.

v3.8.0.1
Commitments and Contingent Liabilities
9 Months Ended
Mar. 29, 2018
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingent Liabilities

Note 12 – Commitments and Contingent Liabilities

We are currently a party to various legal proceedings in the ordinary course of business. While management presently believes that the ultimate outcomes of these proceedings, individually and in the aggregate, will not materially affect our Company’s financial position, results of operations or cash flows, legal proceedings are subject to inherent uncertainties, and unfavorable outcomes could occur. Unfavorable outcomes could include substantial monetary damages in excess of any appropriate accruals which management has established. Were such unfavorable final outcomes to occur, there exists the possibility of a material adverse effect on our financial position, results of operations and cash flows.

We are subject to a class-action complaint for an employment related matter. Mediation for this matter occurred in fiscal 2017. In August 2017, we agreed in principle to a $1,200 settlement for which we were fully reserved at June 29, 2017. The non-monetary components of the settlement are still being finalized.

v3.8.0.1
Fair Value of Financial Instruments
9 Months Ended
Mar. 29, 2018
Fair Value Disclosures [Abstract]  
Fair Value of Financial Instruments

Note 13 – Fair Value of Financial Instruments

Authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) defines fair value as the price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The guidance establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels:

 

Level 1      Quoted prices in active markets that are accessible at the measurement date for identical assets and liabilities.
Level 2      Observable inputs other than quoted prices in active markets. For example, quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets.
Level 3      Unobservable inputs for which there is little or no market data available.

The carrying values of cash, trade accounts receivable and accounts payable approximate their fair values at each balance sheet date because of the short-term maturities and nature of these balances.

The carrying value of our revolving credit facility borrowings approximates fair value at each balance sheet date because interest rates on this instrument approximate current market rates (Level 2 criteria), the short-term maturity and nature of this balance. In addition, there has been no significant change in our inherent credit risk.

The following table summarizes the carrying value and fair value estimate of our current and long-term debt, excluding unamortized debt issuance costs:

 

     March 29,
2018
     June 29,
2017
     March 30,
2017
 

Carrying value of long-term debt:

   $ 36,428      $ 28,808      $ 29,671  

Fair value of long-term debt:

     35,409        29,316        30,186  

The estimated fair value of our long-term debt was determined using a market approach based upon Level 2 observable inputs, which estimates fair value based on interest rates currently offered on loans with similar terms to borrowers of similar credit quality or broker quotes. In addition, there have been no significant changes in the underlying assets securing our long-term debt.

v3.8.0.1
Related Party Transaction
9 Months Ended
Mar. 29, 2018
Related Party Transactions [Abstract]  
Related Party Transaction

Note 14 – Related Party Transaction

In connection with the Acquisition on November 30, 2017, we incurred $11,500 of unsecured debt to the principal owner and seller of the Squirrel Brand business, who was subsequently appointed as an executive officer of the Company. The interest rate on the Promissory Note is 5.5% per annum and the outstanding balance at March 29, 2018 was $10,222. Interest paid on the Promissory Note for the quarter and thirty-nine weeks ended March 29, 2018 was $149 and $202 respectively.

v3.8.0.1
Recent Accounting Pronouncements
9 Months Ended
Mar. 29, 2018
Accounting Changes and Error Corrections [Abstract]  
Recent Accounting Pronouncements

Note 15 – Recent Accounting Pronouncements

The following recent accounting pronouncements have been adopted in the current fiscal year:

In March 2017, the FASB issued ASU No. 2017-07 “Compensation – Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost”. The amendments in this update require the service cost component of pension expense to be disaggregated from the other components of net periodic benefit cost and be presented in the same line items as other employee compensation costs. All other components of net periodic benefit cost (interest cost, amortization of prior service cost and amortization of unrecognized loss) must be presented in the income statement separately from the service cost component and outside a subtotal of income from operations. The amendments in this update also allow only the service cost component to be eligible for capitalization when applicable (for example, as a cost of internally manufactured inventory or a self-constructed asset). This update is effective for public business entities for annual periods beginning after December 15, 2017, including interim periods within those annual periods. Early adoption is permitted as long as it is early adopted in the first interim period of an annual year and financial statements have not been issued or made available for issuance prior to adoption. The amendments in this update should be applied using a retrospective transition method, however, a practical expedient is offered with regard to the prior comparative periods. The Company adopted ASU 2017-07 in the first quarter of fiscal 2018. Service cost continues to be presented as a component of Administrative expense while the remaining components of net periodic benefit cost (interest cost, amortization of prior service cost and amortization of unrecognized loss) are now presented below the caption Other expense on the Consolidated Statements of Comprehensive Income. Adoption of this update required a reclassification of $534 and $1,600 in the prior year third quarter and thirty-nine week period, respectively, from Administrative expense to Other expense.

In October 2016, the FASB issued ASU No. 2016-17 “Consolidation (Topic 810): Interests Held Through Related Parties That Are Under Common Control”. This update amends ASU 2015-02 and affects reporting entities that are required to evaluate whether they should consolidate a variable interest entity in certain situations involving entities under common control. ASU 2016-17 is effective for the Company in fiscal 2018 and requires retrospective application. The adoption of ASU 2016-17 did not have any impact to our Consolidated Financial Statements.

In July 2015, the FASB issued ASU No. 2015-11 “Inventory (Topic 330): Simplifying the Measurement of Inventory”. This update applies to inventory measured using first-in, first-out or average cost and requires inventory be measured at the lower of cost and net realizable value. Net realizable value is defined as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. When evidence exists that the net realizable value of inventory is lower than its cost, the difference shall be recognized as a loss in earnings in the period in which it occurs. That loss may be required, for example, due to damage, physical deterioration, obsolescence, changes in price levels, or other causes. This update became effective for the Company beginning in fiscal year 2018 with prospective application required. The adoption of ASU 2015-11 did not have any impact to our Consolidated Financial Statements.

The following recent accounting pronouncements have not yet been adopted:

In February 2018, the FASB issued ASU No. 2018-02 “Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income”. The amendments in this Update allow a reclassification from accumulated other comprehensive income (loss) to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The amendments in this Update also require certain disclosures about stranded tax effects. The amendments in this Update are effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption of the amendments in this Update is permitted, including adoption in any interim period for public business entities for reporting periods for which financial statements have not yet been issued. The amendments in this Update should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. This update is effective beginning in fiscal 2020 and we do not expect this update to have a material impact on our Consolidated Financial Statements.

In January 2017, the FASB issued ASC Update No. 2017-04 “Intangibles – Goodwill and Other Topics (Topic 350): Simplifying the Test for Goodwill Impairment”. The purpose of this update is to reduce the cost and complexity of evaluating goodwill for impairment. It eliminates the need for entities to calculate the impaired fair value of goodwill by assigning the fair value of a reporting unit to all of its assets and liabilities as if that reporting unit had been acquired in a business combination, commonly referred to as “Step 2”. Under this amendment, an entity will perform its goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying value exceeds the reporting unit’s fair value. This update is effective beginning in fiscal 2021. We do not expect this update to have a material impact on our Consolidated Financial Statements.

In February 2016, the FASB issued ASU No. 2016-02 “Leases (Topic 842)”. The primary goal of this update is to require the lessee to recognize all lease commitments, both operating and finance, by initially recording a lease asset and liability on the balance sheet at the lease commencement date. Additionally, enhanced qualitative and quantitative disclosures will be required. ASU No. 2016-02 is effective for public business entities for annual periods, including interim periods within those annual periods, beginning after December 15, 2018. This new guidance will be effective for the Company beginning in fiscal year 2020. This guidance must be adopted using a modified retrospective approach and early adoption is permitted. The Company expects this new guidance to have a significant impact on its total assets and total liabilities, and lead to increased financial statement disclosures.

In May 2014, the FASB issued ASU No. 2014-09 “Revenue from Contracts with Customers (Topic 606)” and created a new ASC Topic 606, Revenue from Contracts with Customers, and added ASC Subtopic 340-40, Other Assets and Deferred Costs – Contracts with Customers. The guidance in this update supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition, and most industry-specific guidance throughout the industry topics of the codification. Under the new guidance, an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Several other amendments have been subsequently released, each of which provide additional narrow scope clarifications or improvements. In August 2015, the FASB issued ASU No. 2015-14 “Revenue from Contracts with Customers, Deferral of the Effective Date” which deferred the effective date of ASU 2014-09 for one year. Consequently, this new revenue recognition guidance will be effective for the Company beginning in fiscal year 2019, which is our anticipated adoption date. We have completed our initial analysis of this accounting standard update which included a review of all material customer contracts and currently do not anticipate any material changes to our revenue recognition compared to current GAAP. We are currently evaluating the method of adoption.

v3.8.0.1
Recent Accounting Pronouncements (Policies)
9 Months Ended
Mar. 29, 2018
Accounting Changes and Error Corrections [Abstract]  
Recent Accounting Pronouncements

The following recent accounting pronouncements have been adopted in the current fiscal year:

In March 2017, the FASB issued ASU No. 2017-07 “Compensation – Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost”. The amendments in this update require the service cost component of pension expense to be disaggregated from the other components of net periodic benefit cost and be presented in the same line items as other employee compensation costs. All other components of net periodic benefit cost (interest cost, amortization of prior service cost and amortization of unrecognized loss) must be presented in the income statement separately from the service cost component and outside a subtotal of income from operations. The amendments in this update also allow only the service cost component to be eligible for capitalization when applicable (for example, as a cost of internally manufactured inventory or a self-constructed asset). This update is effective for public business entities for annual periods beginning after December 15, 2017, including interim periods within those annual periods. Early adoption is permitted as long as it is early adopted in the first interim period of an annual year and financial statements have not been issued or made available for issuance prior to adoption. The amendments in this update should be applied using a retrospective transition method, however, a practical expedient is offered with regard to the prior comparative periods. The Company adopted ASU 2017-07 in the first quarter of fiscal 2018. Service cost continues to be presented as a component of Administrative expense while the remaining components of net periodic benefit cost (interest cost, amortization of prior service cost and amortization of unrecognized loss) are now presented below the caption Other expense on the Consolidated Statements of Comprehensive Income. Adoption of this update required a reclassification of $534 and $1,600 in the prior year third quarter and thirty-nine week period, respectively, from Administrative expense to Other expense.

In October 2016, the FASB issued ASU No. 2016-17 “Consolidation (Topic 810): Interests Held Through Related Parties That Are Under Common Control”. This update amends ASU 2015-02 and affects reporting entities that are required to evaluate whether they should consolidate a variable interest entity in certain situations involving entities under common control. ASU 2016-17 is effective for the Company in fiscal 2018 and requires retrospective application. The adoption of ASU 2016-17 did not have any impact to our Consolidated Financial Statements.

In July 2015, the FASB issued ASU No. 2015-11 “Inventory (Topic 330): Simplifying the Measurement of Inventory”. This update applies to inventory measured using first-in, first-out or average cost and requires inventory be measured at the lower of cost and net realizable value. Net realizable value is defined as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. When evidence exists that the net realizable value of inventory is lower than its cost, the difference shall be recognized as a loss in earnings in the period in which it occurs. That loss may be required, for example, due to damage, physical deterioration, obsolescence, changes in price levels, or other causes. This update became effective for the Company beginning in fiscal year 2018 with prospective application required. The adoption of ASU 2015-11 did not have any impact to our Consolidated Financial Statements.

The following recent accounting pronouncements have not yet been adopted:

In February 2018, the FASB issued ASU No. 2018-02 “Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income”. The amendments in this Update allow a reclassification from accumulated other comprehensive income (loss) to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The amendments in this Update also require certain disclosures about stranded tax effects. The amendments in this Update are effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption of the amendments in this Update is permitted, including adoption in any interim period for public business entities for reporting periods for which financial statements have not yet been issued. The amendments in this Update should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. This update is effective beginning in fiscal 2020 and we do not expect this update to have a material impact on our Consolidated Financial Statements.

In January 2017, the FASB issued ASC Update No. 2017-04 “Intangibles – Goodwill and Other Topics (Topic 350): Simplifying the Test for Goodwill Impairment”. The purpose of this update is to reduce the cost and complexity of evaluating goodwill for impairment. It eliminates the need for entities to calculate the impaired fair value of goodwill by assigning the fair value of a reporting unit to all of its assets and liabilities as if that reporting unit had been acquired in a business combination, commonly referred to as “Step 2”. Under this amendment, an entity will perform its goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying value exceeds the reporting unit’s fair value. This update is effective beginning in fiscal 2021. We do not expect this update to have a material impact on our Consolidated Financial Statements.

In February 2016, the FASB issued ASU No. 2016-02 “Leases (Topic 842)”. The primary goal of this update is to require the lessee to recognize all lease commitments, both operating and finance, by initially recording a lease asset and liability on the balance sheet at the lease commencement date. Additionally, enhanced qualitative and quantitative disclosures will be required. ASU No. 2016-02 is effective for public business entities for annual periods, including interim periods within those annual periods, beginning after December 15, 2018. This new guidance will be effective for the Company beginning in fiscal year 2020. This guidance must be adopted using a modified retrospective approach and early adoption is permitted. The Company expects this new guidance to have a significant impact on its total assets and total liabilities, and lead to increased financial statement disclosures.

In May 2014, the FASB issued ASU No. 2014-09 “Revenue from Contracts with Customers (Topic 606)” and created a new ASC Topic 606, Revenue from Contracts with Customers, and added ASC Subtopic 340-40, Other Assets and Deferred Costs – Contracts with Customers. The guidance in this update supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition, and most industry-specific guidance throughout the industry topics of the codification. Under the new guidance, an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Several other amendments have been subsequently released, each of which provide additional narrow scope clarifications or improvements. In August 2015, the FASB issued ASU No. 2015-14 “Revenue from Contracts with Customers, Deferral of the Effective Date” which deferred the effective date of ASU 2014-09 for one year. Consequently, this new revenue recognition guidance will be effective for the Company beginning in fiscal year 2019, which is our anticipated adoption date. We have completed our initial analysis of this accounting standard update which included a review of all material customer contracts and currently do not anticipate any material changes to our revenue recognition compared to current GAAP. We are currently evaluating the method of adoption.

v3.8.0.1
Inventories (Tables)
9 Months Ended
Mar. 29, 2018
Inventory Disclosure [Abstract]  
Components of Inventories

Inventories consist of the following:

 

     March 29,
2018
     June 29,
2017
     March 30,
2017
 

Raw material and supplies

   $ 103,332      $ 79,609      $ 112,978  

Work-in-process and finished goods

     81,550        102,811        88,420  
  

 

 

    

 

 

    

 

 

 

Total

   $ 184,882      $ 182,420      $ 201,398  
  

 

 

    

 

 

    

 

 

 
v3.8.0.1
Acquisition of Squirrel Brand L.P. (Tables)
9 Months Ended
Mar. 29, 2018
Business Combinations [Abstract]  
Summary of Purchase Price Allocated on Preliminary Basis

The total purchase price of $33,227 has been allocated on a preliminary basis to the fair values of the assets acquired and liabilities assumed as follows:

 

Accounts receivable

   $ 2,362  

Inventories

     1,957  

Other assets

     63  

Identifiable intangible assets:

  

Customer relationships

     10,500  

Brand names

     8,900  

Non-compete agreement

     270  

Goodwill

     9,650  

Accounts payable and accrued expenses

     (475
  

 

 

 

Total Purchase Price

   $ 33,227  
  

 

 

 
Summary of Unaudited Pro Forma Results of Operations of Company's Acquisition at Beginning

The following reflects the unaudited pro forma results of operations of the Company as if the Acquisition had taken place at the beginning of fiscal 2017. This pro forma information does not purport to represent what the Company’s actual results would have been if the Acquisition had occurred as of the date indicated or what such results would be for any future periods.

 

     Year-Ended
June 29, 2017
     Thirty-Nine
weeks ended
March 29, 2018
 

Pro forma net sales

   $ 863,267      $ 682,235  

Pro forma net income

     36,723        27,393  

Pro forma diluted earnings per share

   $ 3.22      $ 2.39  
v3.8.0.1
Goodwill and Intangible Assets (Tables)
9 Months Ended
Mar. 29, 2018
Goodwill and Intangible Assets Disclosure [Abstract]  
Components of Identifiable Intangible Assets

Identifiable intangible assets that are subject to amortization, which resulted entirely from the Acquisition, are based on our preliminary purchase price allocation and consist of the following at March 29, 2018:

 

     March 29,
2018
     Weighted-average
amortization
period (years)
 

Customer relationships

   $ 10,500        7.5  

Brand names

     8,900        13.8  

Non-compete agreement

     270        5.0  
  

 

 

    

 

 

 
     19,670        11.3  

Less accumulated amortization:

     

Customer relationships

     (923   

Brand names

     (230   

Non-compete agreement

     (18   
  

 

 

    
     (1,171   
  

 

 

    

Net intangible assets

   $ 18,499     
  

 

 

    
Summary of Expected Amortization Expense

Amortization expense for the remainder of fiscal 2018, based on our preliminary purchase price allocation, is expected to be approximately $843 and expected amortization expense the next five fiscal years is as follows:

 

Fiscal year ending

      

June 27, 2019

   $ 3,028  

June 25, 2020

     2,500  

June 24, 2021

     2,162  

June 30, 2022

     1,894  

June 29, 2023

     1,659  
Summary of Changes in Carrying Amount of Goodwill

The changes in the carrying amount of goodwill during the thirty-nine weeks ended March 29, 2018 are as follows:

 

Net balance at June 29, 2017

   $ —    

Goodwill acquired during fiscal 2018

     9,650  
  

 

 

 

Net balance at March 29, 2018

   $ 9,650  
  

 

 

 
v3.8.0.1
Earnings Per Common Share (Tables)
9 Months Ended
Mar. 29, 2018
Earnings Per Share [Abstract]  
Weighted Average Shares Outstanding Used in Computing Basic and Diluted Earnings Per Share

The following table presents the reconciliation of the weighted average shares outstanding used in computing basic and diluted earnings per share:

 

     For the Quarter Ended      For the Thirty-Nine Weeks
Ended
 
     March 29,
2018
     March 30,
2017
     March 29,
2018
     March 30,
2017
 

Weighted average number of shares outstanding – basic

     11,399,492        11,347,920        11,375,437        11,306,251  

Effect of dilutive securities:

     

Stock options and restricted stock units

     54,056        76,878        65,234        86,652  
  

 

 

    

 

 

    

 

 

    

 

 

 

Weighted average number of shares outstanding – diluted

     11,453,548        11,424,798        11,440,671        11,392,903  
  

 

 

    

 

 

    

 

 

    

 

 

 
v3.8.0.1
Stock-Based Compensation Plans (Tables)
9 Months Ended
Mar. 29, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Summary of Restricted Stock Unit RSU Activity

The following is a summary of restricted stock unit (“RSU”) activity for the first thirty-nine weeks of fiscal 2018:

 

Restricted Stock Units

   Shares      Weighted
Average Grant
Date Fair Value
 

Outstanding at June 29, 2017

     201,858      $ 40.36  

Activity:

     

Granted

     60,582        54.41  

Vested (a)

     (73,372      36.52  

Forfeited

     —          —    
  

 

 

    

 

 

 

Outstanding at March 29, 2018

     189,068      $ 46.35  
  

 

 

    

 

 

 

 

(a)  The number of RSUs vested includes shares that were withheld on behalf of employees to satisfy the statutory tax withholding requirements.
Summary of Compensation Expense

The following table summarizes compensation expense charged to earnings for all equity compensation plans for the periods presented:

 

     For the Quarter Ended      For the Thirty-Nine
Weeks Ended
 
     March 29,
2018
     March 30,
2017
     March 29,
2018
     March 30,
2017
 

Stock-based compensation expense

   $ 751      $ 536      $ 2,180      $ 1,964  
v3.8.0.1
Retirement Plan (Tables)
9 Months Ended
Mar. 29, 2018
Retirement Benefits [Abstract]  
Schedule of Net Periodic Benefit Cost

The components of net periodic benefit cost are as follows:

 

     For the Quarter Ended      For the Thirty-Nine
Weeks Ended
 
     March 29,
2018
     March 30,
2017
     March 29,
2018
     March 30,
2017
 

Service cost

   $ 152      $ 157      $ 456      $ 473  

Interest cost

     213        203        638        608  

Amortization of prior service cost

     239        239        718        718  

Amortization of loss

     40        92        121        274  
  

 

 

    

 

 

    

 

 

    

 

 

 

Net periodic benefit cost

   $ 644      $ 691      $ 1,933      $ 2,073  
  

 

 

    

 

 

    

 

 

    

 

 

 
v3.8.0.1
Accumulated Other Comprehensive Loss (Tables)
9 Months Ended
Mar. 29, 2018
Equity [Abstract]  
Changes in Accumulated Other Comprehensive Loss

The table below sets forth the changes to accumulated other comprehensive loss (“AOCL”) for the thirty-nine weeks ended March 29, 2018 and March 30, 2017. These changes are all related to our defined benefit pension plan.

 

Changes to AOCL (a)    For the Thirty-Nine
Weeks Ended
 
   March 29,
2018
     March 30,
2017
 

Balance at beginning of period

   $ (4,404    $ (6,425

Other comprehensive income before reclassifications

     —          —    

Amounts reclassified from accumulated other comprehensive loss

     839        992  

Tax effect

     (288      (377
  

 

 

    

 

 

 

Net current-period other comprehensive income

     551        615  
  

 

 

    

 

 

 

Balance at end of period

   $ (3,853    $ (5,810
  

 

 

    

 

 

 

 

(a)  Amounts in parenthesis indicate debits/expense.
Reclassifications Out of AOCL

The reclassifications out of AOCL for the quarter and thirty-nine weeks ended March 29, 2018 and March 30, 2017 were as follows:

 

                            

Affected line

item in

the Consolidated
Statements of
Comprehensive
Income

Reclassifications from AOCL to earnings (b)    For the Quarter Ended     For the Thirty-Nine
Weeks Ended
   
   March 29,
2018
    March 30,
2017
    March 29,
2018
    March 30,
2017
   

Amortization of defined benefit pension items:

          

Unrecognized prior service cost

   $ (239   $ (239   $ (718   $ (718   Other expense

Unrecognized net loss

     (40     (92     (121     (274   Other expense
  

 

 

   

 

 

   

 

 

   

 

 

   

Total before tax

     (279     (331     (839     (992  

Tax effect

     69       126       288       377     Income tax expense
  

 

 

   

 

 

     

 

 

   

Amortization of defined pension items, net of tax

   $ (210   $ (205   $ (551   $ (615  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

(b)  Amounts in parenthesis indicate debits to expense. See Note 9 – “Retirement Plan” above for additional details.
v3.8.0.1
Fair Value of Financial Instruments (Tables)
9 Months Ended
Mar. 29, 2018
Fair Value Disclosures [Abstract]  
Carrying Value and Fair Value Estimate of Current and Long Term Debt

The following table summarizes the carrying value and fair value estimate of our current and long-term debt, excluding unamortized debt issuance costs:

 

     March 29,
2018
     June 29,
2017
     March 30,
2017
 

Carrying value of long-term debt:

   $ 36,428      $ 28,808      $ 29,671  

Fair value of long-term debt:

     35,409        29,316        30,186  
v3.8.0.1
Basis of Presentation and Description of Business - Additional Information (Detail)
9 Months Ended
Mar. 29, 2018
Channel
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Number of distribution channels 3
v3.8.0.1
Inventories - Components of Inventories (Detail) - USD ($)
$ in Thousands
Mar. 29, 2018
Jun. 29, 2017
Mar. 30, 2017
Inventory Disclosure [Abstract]      
Raw material and supplies $ 103,332 $ 79,609 $ 112,978
Work-in-process and finished goods 81,550 102,811 88,420
Total $ 184,882 $ 182,420 $ 201,398
v3.8.0.1
Acquisition of Squirrel Brand L.P. - Additional Information (Detail) - USD ($)
$ in Thousands
9 Months Ended
Nov. 30, 2017
Mar. 29, 2018
Acquisition Date [Line Items]    
Weighted-average life   11 years 3 months 19 days
Business acquisition, transaction costs   $ 500
Squirrel Brand [Member]    
Acquisition Date [Line Items]    
Business acquisition, purchase price before working capital adjustment $ 31,500  
Date of acquisition Nov. 30, 2017  
Business acquisition, purchase price $ 33,227  
Purchase price paid in cash 21,727  
Net sales resulting from the acquisition   $ 15,065
Squirrel Brand [Member] | Customer Relationships [Member]    
Acquisition Date [Line Items]    
Weighted-average life   7 years 6 months
Squirrel Brand [Member] | Brand Names [Member]    
Acquisition Date [Line Items]    
Weighted-average life   13 years 9 months 18 days
Squirrel Brand [Member] | Unsecured Promissory Note [Member]    
Acquisition Date [Line Items]    
Purchase price financed by seller through unsecured promissory note $ 11,500  
Purchase price financed by seller through unsecured promissory note,term 3 years  
Purchase price financed by seller through unsecured promissory note,interest rate 5.50%  
Unsecured promissory note, periodic payment, principal $ 319  
Unsecured promissory note, periodic payment,commencement date 2018-01  
v3.8.0.1
Acquisition of Squirrel Brand L.P. - Summary of Purchase Price Allocated on Preliminary Basis (Detail) - Squirrel Brand [Member]
$ in Thousands
Nov. 30, 2017
USD ($)
Business Acquisition [Line Items]  
Accounts receivable $ 2,362
Inventories 1,957
Other assets 63
Goodwill 9,650
Accounts payable and accrued expenses (475)
Total Purchase Price 33,227
Customer Relationships [Member]  
Business Acquisition [Line Items]  
Identifiable intangible assets 10,500
Brand Names [Member]  
Business Acquisition [Line Items]  
Identifiable intangible assets 8,900
Non-compete Agreement [Member]  
Business Acquisition [Line Items]  
Identifiable intangible assets $ 270
v3.8.0.1
Acquisition of Squirrel Brand L.P. - Summary of Unaudited Pro Forma Results of Operations of Company's Acquisition at Beginning (Detail) - USD ($)
$ / shares in Units, $ in Thousands
9 Months Ended 12 Months Ended
Mar. 29, 2018
Jun. 29, 2017
Business Acquisition, Pro Forma Information [Abstract]    
Pro forma net sales $ 682,235 $ 863,267
Pro forma net income $ 27,393 $ 36,723
Pro forma diluted earnings per share $ 2.39 $ 3.22
v3.8.0.1
Goodwill and Intangible Assets - Components of Identifiable Intangible Assets (Detail) - USD ($)
$ in Thousands
9 Months Ended
Mar. 29, 2018
Jun. 29, 2017
Mar. 30, 2017
Finite-Lived Intangible Assets [Line Items]      
Total intangible assets, gross $ 19,670 $ 18,690  
Less accumulated amortization:      
Total accumulated amortization (1,171)    
Net intangible assets $ 18,499   $ 233
Weighted-average amortization period 11 years 3 months 19 days    
Customer Relationships [Member] | Squirrel Brand [Member]      
Finite-Lived Intangible Assets [Line Items]      
Total intangible assets, gross $ 10,500    
Less accumulated amortization:      
Total accumulated amortization $ (923)    
Weighted-average amortization period 7 years 6 months    
Brand Names [Member] | Squirrel Brand [Member]      
Finite-Lived Intangible Assets [Line Items]      
Total intangible assets, gross $ 8,900    
Less accumulated amortization:      
Total accumulated amortization $ (230)    
Weighted-average amortization period 13 years 9 months 18 days    
Non-compete Agreement [Member] | Squirrel Brand [Member]      
Finite-Lived Intangible Assets [Line Items]      
Total intangible assets, gross $ 270    
Less accumulated amortization:      
Total accumulated amortization $ (18)    
Weighted-average amortization period 5 years    
v3.8.0.1
Goodwill and Intangible Assets - Additional Information (Detail) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Mar. 29, 2018
Mar. 29, 2018
Jun. 29, 2017
Finite-Lived Intangible Assets [Line Items]      
Intangible assets gross $ 19,670 $ 19,670 $ 18,690
Expected amortization expense for remainder of fiscal 2018 843 843  
Amortization expense related to intangible assets 842 1,171  
Goodwill related to acquisition of Squirrel Brand 9,650 9,650  
Squirrel Brand [Member]      
Finite-Lived Intangible Assets [Line Items]      
Goodwill related to acquisition of Squirrel Brand $ 9,650 $ 9,650  
v3.8.0.1
Goodwill and Intangible Assets - Summary of Expected Amortization Expense (Detail)
$ in Thousands
Mar. 29, 2018
USD ($)
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract]  
June 27, 2019 $ 3,028
June 25, 2020 2,500
June 24, 2021 2,162
June 30, 2022 1,894
June 29, 2023 $ 1,659
v3.8.0.1
Goodwill and Intangible Assets - Summary of Changes in Carrying Amount of Goodwill (Detail)
$ in Thousands
9 Months Ended
Mar. 29, 2018
USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill acquired during fiscal 2018 $ 9,650
Ending balance $ 9,650
v3.8.0.1
Credit Facility - Additional Information (Detail)
Jul. 07, 2017
USD ($)
Dividends
Mar. 29, 2018
USD ($)
Eighth Amendment To Credit Agreement [Member]    
Debt Instrument [Line Items]    
Excess availability required under the credit facility $ 30,000,000  
Eighth Amendment To Credit Agreement [Member] | Maximum [Member]    
Debt Instrument [Line Items]    
Aggregate amount of dividends that can be declared without bank consent $ 60,000,000  
Number of cash or stock dividends that may be declared in each quarter without obtaining bank consent | Dividends 4  
Revolving Credit Facility [Member]    
Debt Instrument [Line Items]    
Available credit under the Credit Facility   $ 57,671,000
Revolving credit facility borrowings   56,579,000
Outstanding letters of credit   $ 3,250,000
v3.8.0.1
Earnings Per Common Share - Weighted Average Shares Outstanding Used in Computing Basic and Diluted Earnings Per Share (Detail) - shares
3 Months Ended 9 Months Ended
Mar. 29, 2018
Mar. 30, 2017
Mar. 29, 2018
Mar. 30, 2017
Weighted Average Number of Shares Outstanding Reconciliation [Abstract]        
Weighted average number of shares outstanding - basic 11,399,492 11,347,920 11,375,437 11,306,251
Effect of dilutive securities:        
Stock options and restricted stock units 54,056 76,878 65,234 86,652
Weighted average number of shares outstanding - diluted 11,453,548 11,424,798 11,440,671 11,392,903
v3.8.0.1
Earnings Per Common Share - Additional Information (Detail) - shares
3 Months Ended 9 Months Ended
Mar. 29, 2018
Mar. 29, 2018
Anti Dilutive Shares [Abstract]    
Anti-dilutive awards excluded from computation of diluted earnings per share 0 0
v3.8.0.1
Stock-Based Compensation Plans - Summary of Restricted Stock Unit RSU Activity (Detail)
9 Months Ended
Mar. 29, 2018
$ / shares
shares
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Outstanding beginning balance, Shares | shares 201,858
Granted, Shares | shares 60,582
Vested, Shares | shares (73,372)
Forfeited, Shares | shares 0
Outstanding ending balance, Shares | shares 189,068
Weighted-Average Grant-Date Fair Value, Beginning Balance | $ / shares $ 40.36
Granted, Weighted-Average Grant-Date Fair Value | $ / shares 54.41
Vested, Weighted-Average Grant-Date Fair Value | $ / shares 36.52
Forfeited, Weighted-Average Grant-Date Fair Value | $ / shares 0
Weighted-Average Grant-Date Fair Value, Ending Balance | $ / shares $ 46.35
v3.8.0.1
Stock-Based Compensation Plans - Additional Information (Detail)
$ in Thousands
9 Months Ended
Mar. 29, 2018
USD ($)
shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Unrecognized compensation expense related to non-vested share-based compensation | $ $ 4,124
Expected weighted average recognize period of unrecognized compensation cost related to non-vested share-based compensation 1 year 8 months 12 days
Restricted Stock Unit [Member]  
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Restricted stock units vested | shares 61,008
v3.8.0.1
Stock-Based Compensation Plans - Summary of Compensation Expense (Detail) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Mar. 29, 2018
Mar. 30, 2017
Mar. 29, 2018
Mar. 30, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]        
Stock-based compensation expense $ 751 $ 536 $ 2,180 $ 1,964
v3.8.0.1
Dividends - Additional Information (Detail) - USD ($)
$ / shares in Units, $ in Thousands
9 Months Ended
Aug. 15, 2017
Jul. 11, 2017
Mar. 29, 2018
Mar. 30, 2017
Equity [Abstract]        
Dividend payable date, declared day   Jul. 11, 2017    
Special cash dividend   $ 2.00    
Annual common stock dividend declared   $ 0.50 $ 2.50 $ 5.00
Dividend paid $ 28,370   $ 28,370 $ 56,464
Dividend paid date   Aug. 15, 2017    
Stockholders of record date   Aug. 02, 2017    
v3.8.0.1
Retirement Plan - Schedule of Net Periodic Benefit Cost (Detail) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Mar. 29, 2018
Mar. 30, 2017
Mar. 29, 2018
Mar. 30, 2017
Retirement Benefits [Abstract]        
Service cost $ 152 $ 157 $ 456 $ 473
Interest cost 213 203 638 608
Amortization of prior service cost 239 239 718 718
Amortization of loss 40 92 121 274
Net periodic benefit cost $ 644 $ 691 $ 1,933 $ 2,073
v3.8.0.1
Accumulated Other Comprehensive Loss - Changes in Accumulated Other Comprehensive Loss (Detail) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Mar. 29, 2018
Mar. 30, 2017
Mar. 29, 2018
Mar. 30, 2017
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]        
Balance at beginning of period     $ (4,404) $ (6,425)
Other comprehensive income before reclassifications     0 0
Amounts reclassified from accumulated other comprehensive loss $ 279 $ 331 839 992
Tax effect     (288) (377)
Other comprehensive income, net of tax 210 205 551 615
Balance at end of period $ (3,853) $ (5,810) $ (3,853) $ (5,810)
v3.8.0.1
Accumulated Other Comprehensive Loss - Reclassifications Out of AOCL (Detail) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Mar. 29, 2018
Mar. 30, 2017
Mar. 29, 2018
Mar. 30, 2017
Accumulated Defined Benefit Plans Adjustment, Net Prior Service Attributable to Parent [Member]        
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]        
Unrecognized prior service cost $ (239) $ (239) $ (718) $ (718)
Accumulated Defined Benefit Plans Adjustment, Net Gain (Loss) Attributable to Parent [Member]        
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]        
Unrecognized net loss (40) (92) (121) (274)
Amortization of Defined Benefit Pension Items [Member]        
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]        
Total amortization of pension items before tax (279) (331) (839) (992)
Income tax expense 69 126 288 377
Amortization of defined pension items, net of tax $ (210) $ (205) $ (551) $ (615)
v3.8.0.1
Income Taxes - Additional Information (Detail) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended 12 Months Ended
Jun. 29, 2018
Dec. 22, 2017
Dec. 21, 2017
Mar. 29, 2018
Mar. 30, 2017
Mar. 29, 2018
Mar. 30, 2017
Jun. 28, 2018
Income Tax Disclosure [Line Items]                
Effective tax rate       29.70% 31.10% 33.70% 32.50%  
Federal corporate income tax rate   21.00% 35.00%          
Increase in income tax expense           $ 2,480    
Excess tax benefits           $ 512    
Scenario Forecast [Member]                
Income Tax Disclosure [Line Items]                
Federal corporate income tax rate 21.00%             28.00%
v3.8.0.1
Commitments and Contingent Liabilities - Additional Information (Detail)
$ in Thousands
Aug. 31, 2017
USD ($)
Commitments and Contingencies Disclosure [Abstract]  
Litigation settlement amount $ 1,200
v3.8.0.1
Fair Value of Financial Instruments - Carrying Value and Fair Value Estimate of Current and Long Term Debt (Detail) - USD ($)
$ in Thousands
Mar. 29, 2018
Jun. 29, 2017
Mar. 30, 2017
Fair Value Disclosures [Abstract]      
Carrying value of long-term debt: $ 36,428 $ 28,808 $ 29,671
Fair value of long-term debt: $ 35,409 $ 29,316 $ 30,186
v3.8.0.1
Related Party Transaction - Additional Information (Detail) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Nov. 30, 2017
Mar. 29, 2018
Mar. 29, 2018
Related Party Transaction [Line Items]      
Purchase price financed by seller through unsecured promissory note $ 11,500    
Interest rate on promissory note   5.50% 5.50%
Outstanding balance of promissory note   $ 10,222 $ 10,222
Promissory Note [Member]      
Related Party Transaction [Line Items]      
Interest paid on promissory note   $ 149 $ 202
v3.8.0.1
Recent Accounting Pronouncements - Additional Information (Detail) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Mar. 29, 2017
Mar. 29, 2017
Restatement Adjustment [Member]    
New Accounting Pronouncements or Change in Accounting Principle [Line Items]    
Reclassification of administrative expense to other expense $ 534 $ 1,600

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