|
☑
|
QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT OF SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
68-0275553
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
Large accelerated filer
|
|
ý
|
|
Accelerated filer
|
|
¨
|
Non-accelerated filer
|
|
¨
|
|
Smaller reporting company
|
|
☐
|
|
|
|
|
Emerging growth company
|
|
☐
|
Title of each class
|
|
Trading Symbol(s)
|
|
Name of each exchange on which registered
|
Common Stock
|
|
CENT
|
|
The NASDAQ Stock Market LLC
|
Class A Common Stock
|
|
CENTA
|
|
The NASDAQ Stock Market LLC
|
|
Common Stock Outstanding as of July 26, 2019
|
12,145,135
|
|
|
|
Class A Common Stock Outstanding as of July 26, 2019
|
43,960,182
|
|
|
|
Class B Stock Outstanding as of July 26, 2019
|
1,652,262
|
|
|
|
•
|
seasonality and fluctuations in our operating results and cash flow;
|
•
|
the impending retirement of our CEO, the transition to a successor, our dependence upon our key executives and the ability to execute on our succession plan;
|
•
|
risks associated with new product introductions, including the risk that our new products will not produce sufficient sales to recoup our investment;
|
•
|
fluctuations in energy prices, fuel and related petrochemical costs;
|
Item 1.
|
Financial Statements
|
|
June 29,
2019 |
|
June 30,
2018 |
|
September 29,
2018 |
||||||
ASSETS
|
|
|
|
|
|
||||||
Current assets:
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
445,632
|
|
|
$
|
204,388
|
|
|
$
|
482,106
|
|
Restricted cash
|
10,924
|
|
|
13,978
|
|
|
10,899
|
|
|||
Short term investments
|
119
|
|
|
—
|
|
|
—
|
|
|||
Accounts receivable (less allowance for doubtful accounts of $15,875, $22,021 and $24,125)
|
395,581
|
|
|
348,781
|
|
|
275,908
|
|
|||
Inventories, net
|
464,917
|
|
|
428,007
|
|
|
427,823
|
|
|||
Prepaid expenses and other
|
32,453
|
|
|
26,735
|
|
|
20,562
|
|
|||
Total current assets
|
1,349,626
|
|
|
1,021,889
|
|
|
1,217,298
|
|
|||
Land, buildings, improvements and equipment—net
|
238,948
|
|
|
211,817
|
|
|
217,647
|
|
|||
Goodwill
|
281,177
|
|
|
268,243
|
|
|
281,177
|
|
|||
Other intangible assets—net
|
139,406
|
|
|
138,610
|
|
|
152,265
|
|
|||
Other assets
|
55,761
|
|
|
67,846
|
|
|
38,822
|
|
|||
Total
|
$
|
2,064,918
|
|
|
$
|
1,708,405
|
|
|
$
|
1,907,209
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
||||||
Current liabilities:
|
|
|
|
|
|
||||||
Accounts payable
|
$
|
137,668
|
|
|
$
|
108,129
|
|
|
$
|
110,259
|
|
Accrued expenses
|
141,029
|
|
|
122,897
|
|
|
102,583
|
|
|||
Current portion of long-term debt
|
116
|
|
|
119
|
|
|
122
|
|
|||
Total current liabilities
|
278,813
|
|
|
231,145
|
|
|
212,964
|
|
|||
Long-term debt
|
692,948
|
|
|
691,741
|
|
|
692,031
|
|
|||
Deferred taxes and other long-term obligations
|
58,834
|
|
|
40,798
|
|
|
49,380
|
|
|||
Equity:
|
|
|
|
|
|
||||||
Common stock, $0.01 par value: 12,145,135 shares outstanding at June 29, 2019, June 30, 2018 and September 29, 2018
|
121
|
|
|
121
|
|
|
121
|
|
|||
Class A common stock, $0.01 par value: 44,081,467, 38,373,324 and 43,953,265 shares outstanding at June 29, 2019, June 30, 2018 and September 29, 2018
|
440
|
|
|
384
|
|
|
439
|
|
|||
Class B stock, $0.01 par value: 1,652,262 shares outstanding
|
16
|
|
|
16
|
|
|
16
|
|
|||
Additional paid-in capital
|
589,849
|
|
|
392,412
|
|
|
590,168
|
|
|||
Accumulated earnings
|
444,645
|
|
|
352,355
|
|
|
362,923
|
|
|||
Accumulated other comprehensive loss
|
(1,426
|
)
|
|
(1,153
|
)
|
|
(1,218
|
)
|
|||
Total Central Garden & Pet Company shareholders’ equity
|
1,033,645
|
|
|
744,135
|
|
|
952,449
|
|
|||
Noncontrolling interest
|
678
|
|
|
586
|
|
|
385
|
|
|||
Total equity
|
1,034,323
|
|
|
744,721
|
|
|
952,834
|
|
|||
Total
|
$
|
2,064,918
|
|
|
$
|
1,708,405
|
|
|
$
|
1,907,209
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 29,
2019 |
|
June 30,
2018 |
|
June 29,
2019 |
|
June 30,
2018 |
||||||||
Net sales
|
$
|
706,575
|
|
|
$
|
657,943
|
|
|
$
|
1,842,266
|
|
|
$
|
1,713,048
|
|
Cost of goods sold and occupancy
|
487,291
|
|
|
455,879
|
|
|
1,286,749
|
|
|
1,184,690
|
|
||||
Gross profit
|
219,284
|
|
|
202,064
|
|
|
555,517
|
|
|
528,358
|
|
||||
Selling, general and administrative expenses
|
150,413
|
|
|
141,245
|
|
|
414,312
|
|
|
379,232
|
|
||||
Operating income
|
68,871
|
|
|
60,819
|
|
|
141,205
|
|
|
149,126
|
|
||||
Interest expense
|
(10,676
|
)
|
|
(10,597
|
)
|
|
(31,930
|
)
|
|
(28,577
|
)
|
||||
Interest income
|
2,178
|
|
|
584
|
|
|
6,970
|
|
|
1,464
|
|
||||
Other income
|
180
|
|
|
2,126
|
|
|
488
|
|
|
542
|
|
||||
Income before income taxes and noncontrolling interest
|
60,553
|
|
|
52,932
|
|
|
116,733
|
|
|
122,555
|
|
||||
Income tax expense
|
14,212
|
|
|
11,395
|
|
|
26,031
|
|
|
8,802
|
|
||||
Income including noncontrolling interest
|
46,341
|
|
|
41,537
|
|
|
90,702
|
|
|
113,753
|
|
||||
Net income (loss) attributable to noncontrolling interest
|
189
|
|
|
(8
|
)
|
|
356
|
|
|
727
|
|
||||
Net income attributable to Central Garden & Pet Company
|
$
|
46,152
|
|
|
$
|
41,545
|
|
|
$
|
90,346
|
|
|
$
|
113,026
|
|
Net income per share attributable to Central Garden & Pet Company:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.81
|
|
|
$
|
0.81
|
|
|
$
|
1.58
|
|
|
$
|
2.22
|
|
Diluted
|
$
|
0.80
|
|
|
$
|
0.79
|
|
|
$
|
1.56
|
|
|
$
|
2.15
|
|
Weighted average shares used in the computation of net income per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
57,319
|
|
|
51,134
|
|
|
57,021
|
|
|
50,938
|
|
||||
Diluted
|
57,985
|
|
|
52,575
|
|
|
57,937
|
|
|
52,670
|
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||||
|
June 29,
2019 |
|
June 30,
2018 |
June 29,
2019 |
|
June 30,
2018 |
||||||||
Income including noncontrolling interest
|
$
|
46,341
|
|
|
$
|
41,537
|
|
$
|
90,702
|
|
|
$
|
113,753
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
||||||||
Foreign currency translation
|
(146
|
)
|
|
(480
|
)
|
(208
|
)
|
|
(202
|
)
|
||||
Total comprehensive income
|
46,195
|
|
|
41,057
|
|
90,494
|
|
|
113,551
|
|
||||
Comprehensive income attributable to noncontrolling interest
|
189
|
|
|
(8
|
)
|
356
|
|
|
727
|
|
||||
Comprehensive income attributable to Central Garden & Pet Company
|
$
|
46,006
|
|
|
$
|
41,065
|
|
$
|
90,138
|
|
|
$
|
112,824
|
|
|
Nine Months Ended
|
||||||
|
June 29,
2019 |
|
June 30,
2018 |
||||
Cash flows from operating activities:
|
|
|
|
||||
Net income
|
$
|
90,702
|
|
|
$
|
113,753
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
37,311
|
|
|
34,872
|
|
||
Amortization of deferred financing costs
|
1,374
|
|
|
1,290
|
|
||
Stock-based compensation
|
10,444
|
|
|
8,567
|
|
||
Deferred income taxes
|
9,875
|
|
|
(13,447
|
)
|
||
Loss (gain) on sale of property and equipment
|
58
|
|
|
(18
|
)
|
||
Other
|
(281
|
)
|
|
2,732
|
|
||
Change in assets and liabilities (excluding businesses acquired):
|
|
|
|
||||
Accounts receivable
|
(93,775
|
)
|
|
(101,608
|
)
|
||
Inventories
|
(3,850
|
)
|
|
(14,856
|
)
|
||
Prepaid expenses and other assets
|
(239
|
)
|
|
(14,290
|
)
|
||
Accounts payable
|
19,728
|
|
|
(1,113
|
)
|
||
Accrued expenses
|
23,268
|
|
|
216
|
|
||
Other long-term obligations
|
(1,811
|
)
|
|
1,664
|
|
||
Net cash provided by operating activities
|
92,804
|
|
|
17,762
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Additions to property and equipment
|
(20,888
|
)
|
|
(27,003
|
)
|
||
Payments to acquire companies, net of cash acquired
|
(41,158
|
)
|
|
(86,777
|
)
|
||
Investments
|
(1,758
|
)
|
|
(8,048
|
)
|
||
Other investing activities
|
(1,203
|
)
|
|
(2,655
|
)
|
||
Net cash used in investing activities
|
(65,007
|
)
|
|
(124,483
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Repayments of long-term debt
|
(46,162
|
)
|
|
(395
|
)
|
||
Proceeds from issuance of long-term debt
|
—
|
|
|
300,000
|
|
||
Borrowings under revolving line of credit
|
—
|
|
|
23,000
|
|
||
Repayments under revolving line of credit
|
—
|
|
|
(23,000
|
)
|
||
Repurchase of common stock, including shares surrendered for tax withholding
|
(17,796
|
)
|
|
(12,942
|
)
|
||
Payment of contingent consideration liability
|
(104
|
)
|
|
(204
|
)
|
||
Distribution to noncontrolling interest
|
(64
|
)
|
|
(1,597
|
)
|
||
Payment of financing costs
|
—
|
|
|
(4,770
|
)
|
||
Net cash (used) provided by financing activities
|
(64,126
|
)
|
|
280,092
|
|
||
Effect of exchange rate changes on cash and cash equivalents
|
(120
|
)
|
|
(47
|
)
|
||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
(36,449
|
)
|
|
173,324
|
|
||
Cash, cash equivalents and restricted cash at beginning of period
|
493,005
|
|
|
45,042
|
|
||
Cash, cash equivalents and restricted cash at end of period
|
$
|
456,556
|
|
|
$
|
218,366
|
|
Supplemental information:
|
|
|
|
||||
Cash paid for interest
|
$
|
34,277
|
|
|
$
|
26,297
|
|
Cash paid for income taxes
|
$
|
12,277
|
|
|
$
|
18,474
|
|
1.
|
Basis of Presentation
|
|
|
June 29, 2019
|
|
|
June 30, 2018
|
|
|
September 29, 2018
|
|
|||
Cash and cash equivalents
|
|
$
|
445,632
|
|
|
$
|
204,388
|
|
|
$
|
482,106
|
|
Restricted cash
|
|
10,924
|
|
|
13,978
|
|
|
10,899
|
|
|||
Total cash, cash equivalents and restricted cash
|
|
$
|
456,556
|
|
|
$
|
218,366
|
|
|
$
|
493,005
|
|
|
|
|
|
|
|
|
|
As Reported June 29, 2019
|
|
Adjustments
|
|
Balances without Adoption of ASC Topic 606 June 29, 2019
|
||||||
Current assets
|
|
|
|
|
|
||||||
Receivables, less allowance for doubtful accounts
|
$
|
395,581
|
|
|
$
|
(8,407
|
)
|
|
$
|
387,174
|
|
Prepaid expenses and other
|
$
|
32,453
|
|
|
$
|
(5,117
|
)
|
|
$
|
27,336
|
|
Total current assets
|
$
|
1,349,626
|
|
|
$
|
(13,524
|
)
|
|
$
|
1,336,102
|
|
|
|
|
|
|
|
||||||
Current liabilities
|
|
|
|
|
|
||||||
Accrued expenses
|
$
|
141,029
|
|
|
$
|
(13,524
|
)
|
|
$
|
127,505
|
|
Total current liabilities
|
$
|
278,813
|
|
|
$
|
(13,524
|
)
|
|
$
|
265,289
|
|
|
|
|
|
|
|
2.
|
Fair Value Measurements
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Short term investments (a)
|
|
$
|
119
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
119
|
|
Total assets
|
|
$
|
119
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
119
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Liability for contingent consideration (b)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,824
|
|
|
$
|
7,824
|
|
Total liabilities
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,824
|
|
|
$
|
7,824
|
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Liability for contingent consideration (b)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,645
|
|
|
$
|
7,645
|
|
Total liabilities
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,645
|
|
|
$
|
7,645
|
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Liability for contingent consideration (b)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,224
|
|
|
$
|
8,224
|
|
Total liabilities
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,224
|
|
|
$
|
8,224
|
|
(a)
|
The fair value of short-term investments are based on quoted prices in active markets for identical assets.
|
(b)
|
The liability for contingent consideration relates to an earn-out for B2E, acquired in December 2012, future performance-based contingent payments for Hydro-Organics Wholesale, Inc., acquired in October 2015, future performance-based contingent payment for Segrest, Inc., acquired in October 2016, and future performance-based contingent payments for Bell Nursery, acquired in March 2018. The contingent period for Bell Nursery expired in December 2018. Performance thresholds that would have necessitated payment were not met, and accordingly, no payment was made. The fair value of the estimated contingent consideration arrangement is determined based on the Company’s evaluation as to the probability and amount of any earn-out that will be achieved based on expected future performance by the acquired entity. This is presented as part of long-term liabilities in the Company's consolidated balance sheets.
|
|
Amount
|
||
Balance September 29, 2018
|
$
|
8,224
|
|
Estimated contingent performance-based consideration established at the time of acquisition
|
—
|
|
|
Changes in the fair value of contingent performance-based payments established at the time of acquisition
|
(296
|
)
|
|
Performance-based payments
|
(104
|
)
|
|
Balance June 29, 2019
|
$
|
7,824
|
|
|
|
||
|
Amount
|
||
Balance September 30, 2017
|
$
|
9,343
|
|
Estimated contingent performance-based consideration established at the time of acquisition
|
—
|
|
|
Changes in the fair value of contingent performance-based payments established at the time of acquisition
|
(1,494
|
)
|
|
Performance-based payments
|
(204
|
)
|
|
Balance June 30, 2018
|
$
|
7,645
|
|
3.
|
Acquisitions
|
4.
|
Inventories, net
|
|
|
June 29, 2019
|
|
June 30, 2018
|
|
September 29, 2018
|
||||||
Raw materials
|
|
$
|
138,073
|
|
|
$
|
118,826
|
|
|
$
|
117,539
|
|
Work in progress
|
|
36,355
|
|
|
33,306
|
|
|
35,691
|
|
|||
Finished goods
|
|
275,286
|
|
|
263,416
|
|
|
263,845
|
|
|||
Supplies
|
|
15,203
|
|
|
12,459
|
|
|
10,748
|
|
|||
Total inventories, net
|
|
$
|
464,917
|
|
|
$
|
428,007
|
|
|
$
|
427,823
|
|
5.
|
Goodwill
|
6.
|
Other Intangible Assets
|
|
|
Gross
|
|
Accumulated
Amortization
|
|
Accumulated
Impairment
|
|
Net
Carrying
Value
|
||||||||
|
|
(in millions)
|
||||||||||||||
June 29, 2019
|
|
|
|
|
|
|
|
|
||||||||
Marketing-related intangible assets – amortizable
|
|
$
|
18.6
|
|
|
$
|
(15.7
|
)
|
|
$
|
—
|
|
|
$
|
2.9
|
|
Marketing-related intangible assets – nonamortizable
|
|
70.6
|
|
|
—
|
|
|
(26.0
|
)
|
|
44.6
|
|
||||
Total
|
|
89.2
|
|
|
(15.7
|
)
|
|
(26.0
|
)
|
|
47.5
|
|
||||
Customer-related intangible assets – amortizable
|
|
128.3
|
|
|
(50.0
|
)
|
|
(2.5
|
)
|
|
75.8
|
|
||||
Other acquired intangible assets – amortizable
|
|
26.0
|
|
|
(15.9
|
)
|
|
—
|
|
|
10.1
|
|
||||
Other acquired intangible assets – nonamortizable
|
|
7.2
|
|
|
—
|
|
|
(1.2
|
)
|
|
6.0
|
|
||||
Total
|
|
33.2
|
|
|
(15.9
|
)
|
|
(1.2
|
)
|
|
16.1
|
|
||||
Total other intangible assets
|
|
$
|
250.7
|
|
|
$
|
(81.6
|
)
|
|
$
|
(29.7
|
)
|
|
$
|
139.4
|
|
|
|
Gross
|
|
Accumulated
Amortization
|
|
Accumulated
Impairment
|
|
Net
Carrying
Value
|
||||||||
|
|
(in millions)
|
||||||||||||||
June 30, 2018
|
|
|
|
|
|
|
|
|
||||||||
Marketing-related intangible assets – amortizable
|
|
$
|
16.9
|
|
|
$
|
(13.8
|
)
|
|
$
|
—
|
|
|
$
|
3.1
|
|
Marketing-related intangible assets – nonamortizable
|
|
70.6
|
|
|
—
|
|
|
(26.0
|
)
|
|
44.6
|
|
||||
Total
|
|
87.5
|
|
|
(13.8
|
)
|
|
(26.0
|
)
|
|
47.7
|
|
||||
Customer-related intangible assets – amortizable
|
|
115.7
|
|
|
(39.7
|
)
|
|
—
|
|
|
76.0
|
|
||||
Other acquired intangible assets – amortizable
|
|
22.1
|
|
|
(13.8
|
)
|
|
—
|
|
|
8.3
|
|
||||
Other acquired intangible assets – nonamortizable
|
|
7.8
|
|
|
—
|
|
|
(1.2
|
)
|
|
6.6
|
|
||||
Total
|
|
29.9
|
|
|
(13.8
|
)
|
|
(1.2
|
)
|
|
14.9
|
|
||||
Total other intangible assets
|
|
$
|
233.1
|
|
|
$
|
(67.3
|
)
|
|
$
|
(27.2
|
)
|
|
$
|
138.6
|
|
|
|
Gross
|
|
Accumulated
Amortization
|
|
Accumulated
Impairment
|
|
Net
Carrying
Value
|
||||||||
|
|
(in millions)
|
||||||||||||||
September 29, 2018
|
|
|
|
|
|
|
|
|
||||||||
Marketing-related intangible assets – amortizable
|
|
$
|
18.6
|
|
|
$
|
(14.2
|
)
|
|
$
|
—
|
|
|
$
|
4.4
|
|
Marketing-related intangible assets – nonamortizable
|
|
70.6
|
|
|
—
|
|
|
(26.0
|
)
|
|
44.6
|
|
||||
Total
|
|
89.2
|
|
|
(14.2
|
)
|
|
(26.0
|
)
|
|
49.0
|
|
||||
Customer-related intangible assets – amortizable
|
|
128.3
|
|
|
(42.5
|
)
|
|
—
|
|
|
85.8
|
|
||||
Other acquired intangible assets – amortizable
|
|
25.4
|
|
|
(14.5
|
)
|
|
—
|
|
|
10.9
|
|
||||
Other acquired intangible assets – nonamortizable
|
|
7.8
|
|
|
—
|
|
|
(1.2
|
)
|
|
6.6
|
|
||||
Total
|
|
33.2
|
|
|
(14.5
|
)
|
|
(1.2
|
)
|
|
17.5
|
|
||||
Total other intangible assets
|
|
$
|
250.7
|
|
|
$
|
(71.2
|
)
|
|
$
|
(27.2
|
)
|
|
$
|
152.3
|
|
7.
|
Long-Term Debt
|
|
|
June 29, 2019
|
|
June 30, 2018
|
|
September 29, 2018
|
||||||
|
|
(in thousands)
|
||||||||||
Senior notes, interest at 6.125%, payable semi-annually, principal due November 2023
|
|
$
|
400,000
|
|
|
$
|
400,000
|
|
|
$
|
400,000
|
|
Senior notes, interest at 5.125%, payable semi-annually, principal due February 2028
|
|
300,000
|
|
|
300,000
|
|
|
300,000
|
|
|||
Unamortized debt issuance costs
|
|
(7,475
|
)
|
|
(8,741
|
)
|
|
(8,425
|
)
|
|||
Net carrying value
|
|
692,525
|
|
|
691,259
|
|
|
691,575
|
|
|||
Asset-based revolving credit facility, interest at LIBOR plus a margin of 1.25% to 1.50% or Base Rate plus a margin of 0.25% to 0.50%, final maturity April 2021
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Other notes payable
|
|
539
|
|
|
601
|
|
|
578
|
|
|||
Total
|
|
693,064
|
|
|
691,860
|
|
|
692,153
|
|
|||
Less current portion
|
|
(116
|
)
|
|
(119
|
)
|
|
(122
|
)
|
|||
Long-term portion
|
|
$
|
692,948
|
|
|
$
|
691,741
|
|
|
$
|
692,031
|
|
8.
|
Supplemental Equity Information
|
|
|
Controlling Interest
|
|
|
|
|
||||||||||||||||||||||||||||||
(in thousands)
|
|
Common
Stock |
|
Class A
Common Stock |
|
Class
B Stock |
|
Additional
Paid In Capital |
|
Retained
Earnings |
|
Accumulated
Other Comprehensive Income (Loss) |
|
Total
|
|
Noncontrolling
Interest |
|
Total
|
||||||||||||||||||
September 29, 2018
|
|
$
|
121
|
|
|
$
|
439
|
|
|
$
|
16
|
|
|
$
|
590,168
|
|
|
$
|
362,923
|
|
|
$
|
(1,218
|
)
|
|
$
|
952,449
|
|
|
$
|
385
|
|
|
$
|
952,834
|
|
Comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,803
|
|
|
(274
|
)
|
|
1,529
|
|
|
(164
|
)
|
|
1,365
|
|
|||||||||
Amortization of share-based awards
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,261
|
|
|
—
|
|
|
—
|
|
|
2,261
|
|
|
—
|
|
|
2,261
|
|
|||||||||
Restricted share activity, including net share settlement
|
|
—
|
|
|
1
|
|
|
—
|
|
|
(386
|
)
|
|
—
|
|
|
—
|
|
|
(385
|
)
|
|
—
|
|
|
(385
|
)
|
|||||||||
Issuance of common stock, including net share settlement of stock options
|
|
—
|
|
|
1
|
|
|
—
|
|
|
408
|
|
|
—
|
|
|
—
|
|
|
409
|
|
|
—
|
|
|
409
|
|
|||||||||
Balance December 29, 2018
|
|
$
|
121
|
|
|
$
|
441
|
|
|
$
|
16
|
|
|
$
|
592,451
|
|
|
$
|
364,726
|
|
|
$
|
(1,492
|
)
|
|
$
|
956,263
|
|
|
$
|
221
|
|
|
$
|
956,484
|
|
Comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
42,391
|
|
|
212
|
|
|
42,603
|
|
|
331
|
|
|
42,934
|
|
|||||||||
Amortization of share-based awards
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,473
|
|
|
—
|
|
|
—
|
|
|
2,473
|
|
|
—
|
|
|
2,473
|
|
|||||||||
Restricted share activity, including net share settlement
|
|
—
|
|
|
2
|
|
|
—
|
|
|
(1,773
|
)
|
|
—
|
|
|
—
|
|
|
(1,771
|
)
|
|
—
|
|
|
(1,771
|
)
|
|||||||||
Issuance of common stock, including net share settlement of stock options
|
|
—
|
|
|
1
|
|
|
—
|
|
|
(820
|
)
|
|
—
|
|
|
—
|
|
|
(819
|
)
|
|
—
|
|
|
(819
|
)
|
|||||||||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||||||
Balance March 30, 2019
|
|
$
|
121
|
|
|
$
|
444
|
|
|
$
|
16
|
|
|
$
|
592,331
|
|
|
$
|
407,117
|
|
|
$
|
(1,280
|
)
|
|
$
|
998,749
|
|
|
$
|
553
|
|
|
$
|
999,302
|
|
Comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46,152
|
|
|
(146
|
)
|
|
46,006
|
|
|
189
|
|
|
46,195
|
|
|||||||||
Amortization of share-based awards
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,965
|
|
|
—
|
|
|
—
|
|
|
2,965
|
|
|
—
|
|
|
2,965
|
|
|||||||||
Restricted share activity, including net share settlement
|
|
—
|
|
|
1
|
|
|
—
|
|
|
(641
|
)
|
|
—
|
|
|
—
|
|
|
(640
|
)
|
|
—
|
|
|
(640
|
)
|
|||||||||
Issuance of common stock, including net share settlement of stock options
|
|
—
|
|
|
1
|
|
|
—
|
|
|
870
|
|
|
—
|
|
|
—
|
|
|
871
|
|
|
—
|
|
|
871
|
|
|||||||||
Repurchase of common stock
|
|
$
|
—
|
|
|
(6
|
)
|
|
$
|
—
|
|
|
(5,676
|
)
|
|
(8,624
|
)
|
|
$
|
—
|
|
|
(14,306
|
)
|
|
—
|
|
|
(14,306
|
)
|
||||||
Distribution to Noncontrolling interest
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
(64
|
)
|
|
(64
|
)
|
|||
Balance June 29, 2019
|
|
$
|
121
|
|
|
$
|
440
|
|
|
$
|
16
|
|
|
$
|
589,849
|
|
|
$
|
444,645
|
|
|
$
|
(1,426
|
)
|
|
$
|
1,033,645
|
|
|
$
|
678
|
|
|
$
|
1,034,323
|
|
|
|
Controlling Interest
|
|
|
|
|
||||||||||||||||||||||||||||||
(in thousands)
|
|
Common Stock
|
|
Class A Common Stock
|
|
Class B Stock
|
|
Additional Paid In Capital
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total
|
|
Noncontrolling Interest
|
|
Total
|
||||||||||||||||||
Balance September 30, 2017
|
|
$
|
122
|
|
|
$
|
380
|
|
|
$
|
16
|
|
|
$
|
396,790
|
|
|
$
|
239,329
|
|
|
$
|
(951
|
)
|
|
$
|
635,686
|
|
|
$
|
1,456
|
|
|
$
|
637,142
|
|
Comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26,247
|
|
|
44
|
|
|
26,291
|
|
|
203
|
|
|
26,494
|
|
|||||||||
Amortization of share-based awards
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,143
|
|
|
—
|
|
|
—
|
|
|
2,143
|
|
|
—
|
|
|
2,143
|
|
|||||||||
Restricted share activity, including net share settlement
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,397
|
)
|
|
—
|
|
|
—
|
|
|
(2,397
|
)
|
|
—
|
|
|
(2,397
|
)
|
|||||||||
Issuance of common stock, including net share settlement of stock options
|
|
—
|
|
|
—
|
|
|
—
|
|
|
166
|
|
|
—
|
|
|
—
|
|
|
166
|
|
|
—
|
|
|
166
|
|
|||||||||
Distribution to Noncontrolling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,597
|
)
|
|
(1,597
|
)
|
|||||||||
Balance December 30, 2017
|
|
$
|
122
|
|
|
$
|
380
|
|
|
$
|
16
|
|
|
$
|
396,702
|
|
|
$
|
265,576
|
|
|
$
|
(907
|
)
|
|
$
|
661,889
|
|
|
$
|
62
|
|
|
$
|
661,951
|
|
Comprehensive income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
45,234
|
|
|
234
|
|
|
45,468
|
|
|
532
|
|
|
46,000
|
|
|||||
Amortization of share-based awards
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,321
|
|
|
—
|
|
|
—
|
|
|
2,321
|
|
|
—
|
|
|
2,321
|
|
|||||||||
Restricted share activity, including net share settlement
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(3,873
|
)
|
|
—
|
|
|
—
|
|
|
(3,874
|
)
|
|
—
|
|
|
(3,874
|
)
|
|||||||||
Issuance of common stock, including net share settlement of stock options
|
|
—
|
|
|
2
|
|
|
—
|
|
|
(1,298
|
)
|
|
—
|
|
|
—
|
|
|
(1,296
|
)
|
|
—
|
|
|
(1,296
|
)
|
|||||||||
Balance March 31, 2018
|
|
$
|
121
|
|
|
$
|
382
|
|
|
$
|
16
|
|
|
$
|
393,852
|
|
|
$
|
310,810
|
|
|
$
|
(673
|
)
|
|
$
|
704,508
|
|
|
$
|
594
|
|
|
$
|
705,102
|
|
Comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
41,545
|
|
|
(480
|
)
|
|
41,065
|
|
|
(8
|
)
|
|
41,057
|
|
|||||||||
Amortization of share-based awards
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,402
|
|
|
—
|
|
|
—
|
|
|
2,402
|
|
|
—
|
|
|
2,402
|
|
|||||||||
Restricted share activity, including net share settlement
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(866
|
)
|
|
—
|
|
|
—
|
|
|
(866
|
)
|
|
—
|
|
|
(866
|
)
|
|||||||||
Issuance of common stock, including net share settlement of stock options
|
|
—
|
|
|
2
|
|
|
—
|
|
|
(2,976
|
)
|
|
—
|
|
|
—
|
|
|
(2,974
|
)
|
|
—
|
|
|
(2,974
|
)
|
|||||||||
Balance June 30, 2018
|
|
$
|
121
|
|
|
$
|
384
|
|
|
$
|
16
|
|
|
$
|
392,412
|
|
|
$
|
352,355
|
|
|
$
|
(1,153
|
)
|
|
$
|
744,135
|
|
|
$
|
586
|
|
|
$
|
744,721
|
|
9.
|
Stock-Based Compensation
|
10.
|
Earnings Per Share
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||
|
|
June 29, 2019
|
|
June 29, 2019
|
||||||||||||||||||
|
|
Income
|
|
Shares
|
|
Per Share
|
|
Income
|
|
Shares
|
|
Per Share
|
||||||||||
Basic EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income available to common shareholders
|
|
$
|
46,152
|
|
|
57,319
|
|
|
$
|
0.81
|
|
|
$
|
90,346
|
|
|
57,021
|
|
|
$
|
1.58
|
|
Effect of dilutive securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Options to purchase common stock
|
|
—
|
|
|
412
|
|
|
(0.01
|
)
|
|
—
|
|
|
559
|
|
|
(0.01
|
)
|
||||
Restricted shares
|
|
—
|
|
|
254
|
|
|
—
|
|
|
—
|
|
|
357
|
|
|
(0.01
|
)
|
||||
Diluted EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income available to common shareholders
|
|
$
|
46,152
|
|
|
57,985
|
|
|
$
|
0.80
|
|
|
$
|
90,346
|
|
|
57,937
|
|
|
$
|
1.56
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||
|
|
June 30, 2018
|
|
June 30, 2018
|
||||||||||||||||||
|
|
Income
|
|
Shares
|
|
Per Share
|
|
Income
|
|
Shares
|
|
Per Share
|
||||||||||
Basic EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income available to common shareholders
|
|
$
|
41,545
|
|
|
51,134
|
|
|
$
|
0.81
|
|
|
$
|
113,026
|
|
|
50,938
|
|
|
$
|
2.22
|
|
Effect of dilutive securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Options to purchase common stock
|
|
—
|
|
|
932
|
|
|
(0.01
|
)
|
|
—
|
|
|
1,058
|
|
|
(0.05
|
)
|
||||
Restricted shares
|
|
—
|
|
|
509
|
|
|
(0.01
|
)
|
|
—
|
|
|
674
|
|
|
(0.02
|
)
|
||||
Diluted EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income available to common shareholders
|
|
$
|
41,545
|
|
|
52,575
|
|
|
$
|
0.79
|
|
|
$
|
113,026
|
|
|
52,670
|
|
|
$
|
2.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11.
|
Segment Information
|
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||||
|
|
June 29,
2019 |
|
June 30,
2018 |
June 29,
2019 |
|
June 30,
2018 |
||||||||
Net sales:
|
|
|
|
|
|
|
|
||||||||
Pet segment
|
|
$
|
350,155
|
|
|
$
|
354,760
|
|
$
|
1,028,754
|
|
|
$
|
1,001,497
|
|
Garden segment
|
|
356,420
|
|
|
303,183
|
|
813,512
|
|
|
711,551
|
|
||||
Total net sales
|
|
$
|
706,575
|
|
|
$
|
657,943
|
|
$
|
1,842,266
|
|
|
$
|
1,713,048
|
|
Operating Income
|
|
|
|
|
|
|
|
||||||||
Pet segment
|
|
35,066
|
|
|
39,242
|
|
91,805
|
|
|
108,202
|
|
||||
Garden segment
|
|
53,103
|
|
|
40,929
|
|
101,821
|
|
|
93,975
|
|
||||
Corporate
|
|
(19,298
|
)
|
|
(19,352
|
)
|
(52,421
|
)
|
|
(53,051
|
)
|
||||
Total operating income
|
|
68,871
|
|
|
60,819
|
|
141,205
|
|
|
149,126
|
|
||||
Interest expense - net
|
|
(8,498
|
)
|
|
(10,013
|
)
|
(24,960
|
)
|
|
(27,113
|
)
|
||||
Other income
|
|
180
|
|
|
2,126
|
|
488
|
|
|
542
|
|
||||
Income tax expense
|
|
14,212
|
|
|
11,395
|
|
26,031
|
|
|
8,802
|
|
||||
Income including noncontrolling interest
|
|
46,341
|
|
|
41,537
|
|
90,702
|
|
|
113,753
|
|
||||
Net income (loss) attributable to noncontrolling interest
|
|
189
|
|
|
(8
|
)
|
356
|
|
|
727
|
|
||||
Net income attributable to Central Garden & Pet Company
|
|
$
|
46,152
|
|
|
$
|
41,545
|
|
$
|
90,346
|
|
|
$
|
113,026
|
|
Depreciation and amortization:
|
|
|
|
|
|
|
|
||||||||
Pet segment
|
|
$
|
8,083
|
|
|
$
|
7,626
|
|
$
|
24,178
|
|
|
$
|
21,715
|
|
Garden segment
|
|
3,497
|
|
|
2,789
|
|
8,635
|
|
|
6,065
|
|
||||
Corporate
|
|
1,502
|
|
|
2,172
|
|
4,498
|
|
|
7,092
|
|
||||
Total depreciation and amortization
|
|
$
|
13,082
|
|
|
$
|
12,587
|
|
$
|
37,311
|
|
|
$
|
34,872
|
|
|
|
June 29,
2019 |
|
June 30,
2018 |
|
September 29,
2018 |
||||||
Assets:
|
|
|
|
|
|
|
||||||
Pet segment
|
|
$
|
742,938
|
|
|
$
|
687,561
|
|
|
$
|
683,938
|
|
Garden segment
|
|
558,260
|
|
|
486,603
|
|
|
407,483
|
|
|||
Corporate
|
|
763,720
|
|
|
534,241
|
|
|
815,788
|
|
|||
Total assets
|
|
$
|
2,064,918
|
|
|
$
|
1,708,405
|
|
|
$
|
1,907,209
|
|
Goodwill (included in corporate assets above):
|
|
|
|
|
|
|
||||||
Pet segment
|
|
$
|
268,289
|
|
|
$
|
262,770
|
|
|
$
|
268,289
|
|
Garden segment
|
|
12,888
|
|
|
5,473
|
|
|
12,888
|
|
|||
Total goodwill
|
|
$
|
281,177
|
|
|
$
|
268,243
|
|
|
$
|
281,177
|
|
|
|
Three Months Ended June 29, 2019
|
|
Nine Months Ended June 29, 2019
|
||||||||||||||||||||
|
|
Pet Segment
|
|
Garden Segment
|
|
Total
|
|
Pet Segment
|
|
Garden Segment
|
|
Total
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other pet products
|
|
$
|
250.3
|
|
|
$
|
—
|
|
|
$
|
250.3
|
|
|
$
|
692.6
|
|
|
$
|
—
|
|
|
$
|
692.6
|
|
Dog and cat products
|
|
99.9
|
|
|
—
|
|
|
99.9
|
|
|
336.2
|
|
|
—
|
|
|
336.2
|
|
||||||
Garden controls and fertilizer products
|
|
—
|
|
|
80.9
|
|
|
80.9
|
|
|
—
|
|
|
219.0
|
|
|
219.0
|
|
||||||
Other garden supplies
|
|
—
|
|
|
275.5
|
|
|
275.5
|
|
|
—
|
|
|
594.5
|
|
|
594.5
|
|
||||||
Total
|
|
$
|
350.2
|
|
|
$
|
356.4
|
|
|
$
|
706.6
|
|
|
$
|
1,028.8
|
|
|
$
|
813.5
|
|
|
$
|
1,842.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2018
|
|
Nine Months Ended June 30, 2018
|
||||||||||||||||||||
|
|
Pet Segment
|
|
Garden Segment
|
|
Total
|
|
Pet Segment
|
|
Garden Segment
|
|
Total
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other pet products
|
|
$
|
254.8
|
|
|
$
|
—
|
|
|
$
|
254.8
|
|
|
$
|
668.7
|
|
|
$
|
—
|
|
|
$
|
668.7
|
|
Dog and cat products
|
|
100.0
|
|
|
—
|
|
|
100.0
|
|
|
332.8
|
|
|
—
|
|
|
332.8
|
|
||||||
Garden controls and fertilizer products
|
|
—
|
|
|
86.6
|
|
|
86.6
|
|
|
—
|
|
|
229.1
|
|
|
229.1
|
|
||||||
Other garden supplies
|
|
—
|
|
|
216.6
|
|
|
216.6
|
|
|
—
|
|
|
482.5
|
|
|
482.5
|
|
||||||
Total
|
|
$
|
354.8
|
|
|
$
|
303.2
|
|
|
$
|
657.9
|
|
|
$
|
1,001.5
|
|
|
$
|
711.6
|
|
|
$
|
1,713.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12.
|
Consolidating Condensed Financial Information of Guarantor Subsidiaries
|
|
|
CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS
|
||||||||||||||||||
|
|
Three Months Ended June 29, 2019
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non- Guarantor Subsidiaries
|
|
Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net sales
|
|
$
|
199,470
|
|
|
$
|
102,869
|
|
|
$
|
423,268
|
|
|
$
|
(19,032
|
)
|
|
$
|
706,575
|
|
Cost of goods sold and occupancy
|
|
153,637
|
|
|
69,232
|
|
|
281,734
|
|
|
(17,312
|
)
|
|
487,291
|
|
|||||
Gross profit
|
|
45,833
|
|
|
33,637
|
|
|
141,534
|
|
|
(1,720
|
)
|
|
219,284
|
|
|||||
Selling, general and administrative expenses
|
|
45,219
|
|
|
14,595
|
|
|
92,319
|
|
|
(1,720
|
)
|
|
150,413
|
|
|||||
Operating income
|
|
614
|
|
|
19,042
|
|
|
49,215
|
|
|
—
|
|
|
68,871
|
|
|||||
Interest expense
|
|
(10,500
|
)
|
|
(133
|
)
|
|
(43
|
)
|
|
—
|
|
|
(10,676
|
)
|
|||||
Interest income
|
|
2,173
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
2,178
|
|
|||||
Other (expense) income
|
|
(86
|
)
|
|
(273
|
)
|
|
539
|
|
|
—
|
|
|
180
|
|
|||||
Income (loss) before taxes and equity in earnings (losses) of affiliates
|
|
(7,799
|
)
|
|
18,641
|
|
|
49,711
|
|
|
—
|
|
|
60,553
|
|
|||||
Income tax expense (benefit)
|
|
(1,985
|
)
|
|
438
|
|
|
15,759
|
|
|
—
|
|
|
14,212
|
|
|||||
Equity in earnings of affiliates
|
|
51,966
|
|
|
—
|
|
|
1,301
|
|
|
(53,267
|
)
|
|
—
|
|
|||||
Net income including noncontrolling interest
|
|
46,152
|
|
|
18,203
|
|
|
35,253
|
|
|
(53,267
|
)
|
|
46,341
|
|
|||||
Net income attributable to noncontrolling interest
|
|
—
|
|
|
189
|
|
|
—
|
|
|
—
|
|
|
189
|
|
|||||
Net income attributable to Central Garden & Pet Company
|
|
$
|
46,152
|
|
|
$
|
18,014
|
|
|
$
|
35,253
|
|
|
$
|
(53,267
|
)
|
|
$
|
46,152
|
|
|
|
CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS
|
||||||||||||||||||
|
|
Three Months Ended June 30, 2018
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non- Guarantor Subsidiaries
|
|
Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net sales
|
|
$
|
208,095
|
|
|
$
|
93,122
|
|
|
$
|
379,059
|
|
|
$
|
(22,333
|
)
|
|
$
|
657,943
|
|
Cost of goods sold and occupancy
|
|
161,192
|
|
|
67,308
|
|
|
247,559
|
|
|
(20,180
|
)
|
|
455,879
|
|
|||||
Gross profit
|
|
46,903
|
|
|
25,814
|
|
|
131,500
|
|
|
(2,153
|
)
|
|
202,064
|
|
|||||
Selling, general and administrative expenses
|
|
45,974
|
|
|
14,837
|
|
|
82,587
|
|
|
(2,153
|
)
|
|
141,245
|
|
|||||
Operating income
|
|
929
|
|
|
10,977
|
|
|
48,913
|
|
|
—
|
|
|
60,819
|
|
|||||
Interest expense
|
|
(10,470
|
)
|
|
(125
|
)
|
|
(2
|
)
|
|
—
|
|
|
(10,597
|
)
|
|||||
Interest income
|
|
583
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
584
|
|
|||||
Other income (loss)
|
|
1,965
|
|
|
(394
|
)
|
|
555
|
|
|
—
|
|
|
2,126
|
|
|||||
Income (loss) before taxes and equity in earnings of affiliates
|
|
(6,993
|
)
|
|
10,459
|
|
|
49,466
|
|
|
—
|
|
|
52,932
|
|
|||||
Income tax expense (benefit)
|
|
(2,633
|
)
|
|
236
|
|
|
13,792
|
|
|
|
|
11,395
|
|
||||||
Equity in earnings of affiliates
|
|
45,905
|
|
|
—
|
|
|
261
|
|
|
(46,166
|
)
|
|
—
|
|
|||||
Net income including noncontrolling interest
|
|
41,545
|
|
|
10,223
|
|
|
35,935
|
|
|
(46,166
|
)
|
|
41,537
|
|
|||||
Net loss attributable to noncontrolling interest
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|||||
Net income attributable to Central Garden & Pet Company
|
|
$
|
41,545
|
|
|
$
|
10,231
|
|
|
$
|
35,935
|
|
|
$
|
(46,166
|
)
|
|
$
|
41,545
|
|
|
|
CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS
|
||||||||||||||||||
|
|
Nine Months Ended June 29, 2019
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non-
Guarantor
Subsidiaries
|
|
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net sales
|
|
$
|
586,918
|
|
|
$
|
161,689
|
|
|
$
|
1,152,912
|
|
|
$
|
(59,253
|
)
|
|
$
|
1,842,266
|
|
Cost of goods sold and occupancy
|
|
452,783
|
|
|
121,578
|
|
|
767,281
|
|
|
(54,893
|
)
|
|
1,286,749
|
|
|||||
Gross profit
|
|
134,135
|
|
|
40,111
|
|
|
385,631
|
|
|
(4,360
|
)
|
|
555,517
|
|
|||||
Selling, general and administrative expenses
|
|
136,019
|
|
|
32,431
|
|
|
250,222
|
|
|
(4,360
|
)
|
|
414,312
|
|
|||||
Operating income (loss)
|
|
(1,884
|
)
|
|
7,680
|
|
|
135,409
|
|
|
—
|
|
|
141,205
|
|
|||||
Interest expense
|
|
(31,479
|
)
|
|
(388
|
)
|
|
(63
|
)
|
|
—
|
|
|
(31,930
|
)
|
|||||
Interest income
|
|
6,956
|
|
|
14
|
|
|
—
|
|
|
—
|
|
|
6,970
|
|
|||||
Other income (expense)
|
|
256
|
|
|
(246
|
)
|
|
478
|
|
|
—
|
|
|
488
|
|
|||||
Income (loss) before taxes and equity in earnings of affiliates
|
|
(26,151
|
)
|
|
7,060
|
|
|
135,824
|
|
|
—
|
|
|
116,733
|
|
|||||
Income tax expense (benefit)
|
|
(5,821
|
)
|
|
127
|
|
|
31,725
|
|
|
—
|
|
|
26,031
|
|
|||||
Equity in earnings of affiliates
|
|
110,676
|
|
|
—
|
|
|
88
|
|
|
(110,764
|
)
|
|
—
|
|
|||||
Net income including noncontrolling interest
|
|
90,346
|
|
|
6,933
|
|
|
104,187
|
|
|
(110,764
|
)
|
|
90,702
|
|
|||||
Net income attributable to noncontrolling interest
|
|
—
|
|
|
356
|
|
|
—
|
|
|
—
|
|
|
356
|
|
|||||
Net income attributable to Central Garden & Pet Company
|
|
$
|
90,346
|
|
|
$
|
6,577
|
|
|
$
|
104,187
|
|
|
$
|
(110,764
|
)
|
|
$
|
90,346
|
|
|
|
CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS
|
||||||||||||||||||
|
|
Nine Months Ended June 30, 2018
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non-
Guarantor
Subsidiaries
|
|
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net sales
|
|
$
|
562,620
|
|
|
$
|
139,298
|
|
|
$
|
1,077,831
|
|
|
$
|
(66,701
|
)
|
|
$
|
1,713,048
|
|
Cost of goods sold and occupancy
|
|
438,539
|
|
|
103,316
|
|
|
704,682
|
|
|
(61,847
|
)
|
|
1,184,690
|
|
|||||
Gross profit
|
|
124,081
|
|
|
35,982
|
|
|
373,149
|
|
|
(4,854
|
)
|
|
528,358
|
|
|||||
Selling, general and administrative expenses
|
|
124,290
|
|
|
25,274
|
|
|
234,522
|
|
|
(4,854
|
)
|
|
379,232
|
|
|||||
Operating income (loss)
|
|
(209
|
)
|
|
10,708
|
|
|
138,627
|
|
|
—
|
|
|
149,126
|
|
|||||
Interest expense
|
|
(28,365
|
)
|
|
(203
|
)
|
|
(9
|
)
|
|
—
|
|
|
(28,577
|
)
|
|||||
Interest income
|
|
1,461
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
1,464
|
|
|||||
Other income (expense)
|
|
155
|
|
|
(140
|
)
|
|
527
|
|
|
—
|
|
|
542
|
|
|||||
Income (loss) before taxes and equity in earnings of affiliates
|
|
(26,958
|
)
|
|
10,368
|
|
|
139,145
|
|
|
—
|
|
|
122,555
|
|
|||||
Income tax expense (benefit)
|
|
(1,961
|
)
|
|
(31
|
)
|
|
10,794
|
|
|
—
|
|
|
8,802
|
|
|||||
Equity in earnings of affiliates
|
|
138,023
|
|
|
—
|
|
|
1,202
|
|
|
(139,225
|
)
|
|
—
|
|
|||||
Net income including noncontrolling interest
|
|
113,026
|
|
|
10,399
|
|
|
129,553
|
|
|
(139,225
|
)
|
|
113,753
|
|
|||||
Net income attributable to noncontrolling interest
|
|
—
|
|
|
727
|
|
|
—
|
|
|
—
|
|
|
727
|
|
|||||
Net income attributable to Central Garden & Pet Company
|
|
$
|
113,026
|
|
|
$
|
9,672
|
|
|
$
|
129,553
|
|
|
$
|
(139,225
|
)
|
|
$
|
113,026
|
|
|
|
CONSOLIDATING CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
||||||||||||||||||
|
|
Three Months Ended June 29, 2019
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non-
Guarantor
Subsidiaries
|
|
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net income
|
|
$
|
46,152
|
|
|
$
|
18,203
|
|
|
$
|
35,253
|
|
|
$
|
(53,267
|
)
|
|
$
|
46,341
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign currency translation
|
|
(146
|
)
|
|
(132
|
)
|
|
37
|
|
|
95
|
|
|
(146
|
)
|
|||||
Total comprehensive income
|
|
46,006
|
|
|
18,071
|
|
|
35,290
|
|
|
(53,172
|
)
|
|
46,195
|
|
|||||
Comprehensive income attributable to noncontrolling interests
|
|
—
|
|
|
189
|
|
|
—
|
|
|
—
|
|
|
189
|
|
|||||
Comprehensive income attributable to Central Garden & Pet Company
|
|
$
|
46,006
|
|
|
$
|
17,882
|
|
|
$
|
35,290
|
|
|
$
|
(53,172
|
)
|
|
$
|
46,006
|
|
|
|
CONSOLIDATING CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
||||||||||||||||||
|
|
Three Months Ended June 30, 2018
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non-
Guarantor
Subsidiaries
|
|
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net income
|
|
$
|
41,545
|
|
|
$
|
10,223
|
|
|
$
|
35,935
|
|
|
$
|
(46,166
|
)
|
|
$
|
41,537
|
|
Other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign currency translation
|
|
(480
|
)
|
|
(323
|
)
|
|
(35
|
)
|
|
358
|
|
|
(480
|
)
|
|||||
Total comprehensive income
|
|
41,065
|
|
|
9,900
|
|
|
35,900
|
|
|
(45,808
|
)
|
|
41,057
|
|
|||||
Comprehensive loss attributable to noncontrolling interests
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|||||
Comprehensive income attributable to Central Garden & Pet Company
|
|
$
|
41,065
|
|
|
$
|
9,908
|
|
|
$
|
35,900
|
|
|
$
|
(45,808
|
)
|
|
$
|
41,065
|
|
|
|
CONSOLIDATING CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
||||||||||||||||||
|
|
Nine Months Ended June 29, 2019
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non-
Guarantor
Subsidiaries
|
|
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net income
|
|
$
|
90,346
|
|
|
$
|
6,933
|
|
|
$
|
104,187
|
|
|
$
|
(110,764
|
)
|
|
$
|
90,702
|
|
Other comprehensive loss:
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|||||
Foreign currency translation
|
|
(208
|
)
|
|
(134
|
)
|
|
(23
|
)
|
|
157
|
|
|
(208
|
)
|
|||||
Total comprehensive income
|
|
90,138
|
|
|
6,799
|
|
|
104,164
|
|
|
(110,607
|
)
|
|
90,494
|
|
|||||
Comprehensive income attributable to noncontrolling interests
|
|
—
|
|
|
356
|
|
|
—
|
|
|
—
|
|
|
356
|
|
|||||
Comprehensive income attributable to Central Garden & Pet Company
|
|
$
|
90,138
|
|
|
$
|
6,443
|
|
|
$
|
104,164
|
|
|
$
|
(110,607
|
)
|
|
$
|
90,138
|
|
|
|
CONSOLIDATING CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
||||||||||||||||||
|
|
Nine Months Ended June 30, 2018
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non-
Guarantor
Subsidiaries
|
|
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net income
|
|
$
|
113,026
|
|
|
$
|
10,399
|
|
|
$
|
129,553
|
|
|
$
|
(139,225
|
)
|
|
$
|
113,753
|
|
Other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Foreign currency translation
|
|
(202
|
)
|
|
(74
|
)
|
|
(99
|
)
|
|
173
|
|
|
(202
|
)
|
|||||
Total comprehensive income
|
|
112,824
|
|
|
10,325
|
|
|
129,454
|
|
|
(139,052
|
)
|
|
113,551
|
|
|||||
Comprehensive income attributable to noncontrolling interests
|
|
—
|
|
|
727
|
|
|
—
|
|
|
—
|
|
|
727
|
|
|||||
Comprehensive income attributable to Central Garden & Pet Company
|
|
$
|
112,824
|
|
|
$
|
9,598
|
|
|
$
|
129,454
|
|
|
$
|
(139,052
|
)
|
|
$
|
112,824
|
|
|
|
CONSOLIDATING CONDENSED BALANCE SHEET
|
||||||||||||||||||
|
|
June 29, 2019
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non-
Guarantor
Subsidiaries
|
|
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
421,542
|
|
|
$
|
3,761
|
|
|
$
|
20,329
|
|
|
$
|
—
|
|
|
$
|
445,632
|
|
Restricted cash
|
|
10,924
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,924
|
|
|||||
Short term investments
|
|
—
|
|
|
—
|
|
|
119
|
|
|
—
|
|
|
119
|
|
|||||
Accounts receivable, net
|
|
114,610
|
|
|
19,979
|
|
|
260,992
|
|
|
—
|
|
|
395,581
|
|
|||||
Inventories
|
|
124,224
|
|
|
37,705
|
|
|
302,988
|
|
|
—
|
|
|
464,917
|
|
|||||
Prepaid expenses and other
|
|
8,154
|
|
|
1,914
|
|
|
22,385
|
|
|
—
|
|
|
32,453
|
|
|||||
Total current assets
|
|
679,454
|
|
|
63,359
|
|
|
606,813
|
|
|
—
|
|
|
1,349,626
|
|
|||||
Land, buildings, improvements and equipment, net
|
|
28,181
|
|
|
35,674
|
|
|
175,093
|
|
|
—
|
|
|
238,948
|
|
|||||
Goodwill
|
|
20,578
|
|
|
7,414
|
|
|
253,185
|
|
|
—
|
|
|
281,177
|
|
|||||
Other long-term assets
|
|
44,637
|
|
|
6,235
|
|
|
147,937
|
|
|
(3,642
|
)
|
|
195,167
|
|
|||||
Intercompany receivable
|
|
32,503
|
|
|
—
|
|
|
764,826
|
|
|
(797,329
|
)
|
|
—
|
|
|||||
Investment in subsidiaries
|
|
1,770,053
|
|
|
—
|
|
|
—
|
|
|
(1,770,053
|
)
|
|
—
|
|
|||||
Total
|
|
$
|
2,575,406
|
|
|
$
|
112,682
|
|
|
$
|
1,947,854
|
|
|
$
|
(2,571,024
|
)
|
|
$
|
2,064,918
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
|
$
|
40,953
|
|
|
$
|
15,456
|
|
|
$
|
81,259
|
|
|
$
|
—
|
|
|
$
|
137,668
|
|
Accrued expenses
|
|
54,442
|
|
|
7,581
|
|
|
79,006
|
|
|
—
|
|
|
141,029
|
|
|||||
Current portion of long-term debt
|
|
116
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
116
|
|
|||||
Total current liabilities
|
|
95,511
|
|
|
23,037
|
|
|
160,265
|
|
|
—
|
|
|
278,813
|
|
|||||
Long-term debt
|
|
692,748
|
|
|
—
|
|
|
200
|
|
|
—
|
|
|
692,948
|
|
|||||
Intercompany payable
|
|
746,732
|
|
|
50,597
|
|
|
—
|
|
|
(797,329
|
)
|
|
—
|
|
|||||
Losses in excess of investment in subsidiaries
|
|
—
|
|
|
—
|
|
|
25,199
|
|
|
(25,199
|
)
|
|
—
|
|
|||||
Other long-term obligations
|
|
6,770
|
|
|
—
|
|
|
55,706
|
|
|
(3,642
|
)
|
|
58,834
|
|
|||||
Total Central Garden & Pet shareholders’ equity
|
|
1,033,645
|
|
|
38,370
|
|
|
1,706,484
|
|
|
(1,744,854
|
)
|
|
1,033,645
|
|
|||||
Noncontrolling interest
|
|
—
|
|
|
678
|
|
|
—
|
|
|
|
|
|
678
|
|
|||||
Total equity
|
|
1,033,645
|
|
|
39,048
|
|
|
1,706,484
|
|
|
(1,744,854
|
)
|
|
1,034,323
|
|
|||||
Total
|
|
$
|
2,575,406
|
|
|
$
|
112,682
|
|
|
$
|
1,947,854
|
|
|
$
|
(2,571,024
|
)
|
|
$
|
2,064,918
|
|
|
|
CONSOLIDATING CONDENSED BALANCE SHEET
|
||||||||||||||||||
|
|
June 30, 2018
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non-
Guarantor
Subsidiaries
|
|
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
196,051
|
|
|
$
|
5,060
|
|
|
$
|
3,277
|
|
|
$
|
—
|
|
|
$
|
204,388
|
|
Restricted cash
|
|
13,978
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,978
|
|
|||||
Accounts receivable, net
|
|
122,534
|
|
|
20,612
|
|
|
205,635
|
|
|
—
|
|
|
348,781
|
|
|||||
Inventories
|
|
124,029
|
|
|
36,841
|
|
|
267,137
|
|
|
—
|
|
|
428,007
|
|
|||||
Prepaid expenses and other
|
|
6,032
|
|
|
2,065
|
|
|
18,638
|
|
|
—
|
|
|
26,735
|
|
|||||
Total current assets
|
|
462,624
|
|
|
64,578
|
|
|
494,687
|
|
|
—
|
|
|
1,021,889
|
|
|||||
Land, buildings, improvements and equipment, net
|
|
35,000
|
|
|
34,024
|
|
|
142,793
|
|
|
—
|
|
|
211,817
|
|
|||||
Goodwill
|
|
15,058
|
|
|
—
|
|
|
253,185
|
|
|
—
|
|
|
268,243
|
|
|||||
Other long-term assets
|
|
72,697
|
|
|
14,009
|
|
|
131,010
|
|
|
(11,260
|
)
|
|
206,456
|
|
|||||
Intercompany receivable
|
|
40,342
|
|
|
—
|
|
|
684,808
|
|
|
(725,150
|
)
|
|
—
|
|
|||||
Investment in subsidiaries
|
|
1,583,729
|
|
|
—
|
|
|
—
|
|
|
(1,583,729
|
)
|
|
—
|
|
|||||
Total
|
|
$
|
2,209,450
|
|
|
$
|
112,611
|
|
|
$
|
1,706,483
|
|
|
$
|
(2,320,139
|
)
|
|
$
|
1,708,405
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
|
$
|
32,330
|
|
|
$
|
13,242
|
|
|
$
|
62,557
|
|
|
$
|
—
|
|
|
$
|
108,129
|
|
Accrued expenses
|
|
61,367
|
|
|
7,256
|
|
|
54,274
|
|
|
—
|
|
|
122,897
|
|
|||||
Current portion of long-term debt
|
|
106
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
119
|
|
|||||
Total current liabilities
|
|
93,803
|
|
|
20,498
|
|
|
116,844
|
|
|
—
|
|
|
231,145
|
|
|||||
Long-term debt
|
|
691,591
|
|
|
—
|
|
|
150
|
|
|
—
|
|
|
691,741
|
|
|||||
Intercompany payable
|
|
671,405
|
|
|
53,745
|
|
|
—
|
|
|
(725,150
|
)
|
|
—
|
|
|||||
Losses in excess of investment in subsidiaries
|
|
—
|
|
|
—
|
|
|
24,967
|
|
|
(24,967
|
)
|
|
—
|
|
|||||
Other long-term obligations
|
|
8,516
|
|
|
—
|
|
|
43,542
|
|
|
(11,260
|
)
|
|
40,798
|
|
|||||
Total Central Garden & Pet shareholders’ equity (deficit)
|
|
744,135
|
|
|
37,782
|
|
|
1,520,980
|
|
|
(1,558,762
|
)
|
|
744,135
|
|
|||||
Noncontrolling interest
|
|
—
|
|
|
586
|
|
|
—
|
|
|
—
|
|
|
586
|
|
|||||
Total equity
|
|
744,135
|
|
|
38,368
|
|
|
1,520,980
|
|
|
(1,558,762
|
)
|
|
744,721
|
|
|||||
Total
|
|
$
|
2,209,450
|
|
|
$
|
112,611
|
|
|
$
|
1,706,483
|
|
|
$
|
(2,320,139
|
)
|
|
$
|
1,708,405
|
|
|
|
CONSOLIDATING CONDENSED BALANCE SHEET
|
||||||||||||||||||
|
|
September 29, 2018
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non-
Guarantor
Subsidiaries
|
|
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
474,210
|
|
|
$
|
6,005
|
|
|
$
|
1,891
|
|
|
$
|
—
|
|
|
$
|
482,106
|
|
Restricted cash
|
|
10,899
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,899
|
|
|||||
Accounts receivable, net
|
|
94,657
|
|
|
9,647
|
|
|
171,604
|
|
|
—
|
|
|
275,908
|
|
|||||
Inventories
|
|
123,178
|
|
|
32,556
|
|
|
272,089
|
|
|
—
|
|
|
427,823
|
|
|||||
Prepaid expenses and other assets
|
|
6,304
|
|
|
1,455
|
|
|
12,803
|
|
|
—
|
|
|
20,562
|
|
|||||
Total current assets
|
|
709,248
|
|
|
49,663
|
|
|
458,387
|
|
|
—
|
|
|
1,217,298
|
|
|||||
Land, buildings, improvements and equipment, net
|
|
33,484
|
|
|
33,840
|
|
|
150,323
|
|
|
—
|
|
|
217,647
|
|
|||||
Goodwill
|
|
20,578
|
|
|
7,414
|
|
|
253,185
|
|
|
—
|
|
|
281,177
|
|
|||||
Other long-term assets
|
|
62,199
|
|
|
7,469
|
|
|
133,145
|
|
|
(11,726
|
)
|
|
191,087
|
|
|||||
Intercompany receivable
|
|
40,365
|
|
|
—
|
|
|
769,886
|
|
|
(810,251
|
)
|
|
—
|
|
|||||
Investment in subsidiaries
|
|
1,618,378
|
|
|
—
|
|
|
—
|
|
|
(1,618,378
|
)
|
|
—
|
|
|||||
Total
|
|
$
|
2,484,252
|
|
|
$
|
98,386
|
|
|
$
|
1,764,926
|
|
|
$
|
(2,440,355
|
)
|
|
$
|
1,907,209
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
|
$
|
33,122
|
|
|
$
|
4,759
|
|
|
$
|
72,378
|
|
|
$
|
—
|
|
|
$
|
110,259
|
|
Accrued expenses and other liabilities
|
|
44,142
|
|
|
4,746
|
|
|
53,695
|
|
|
—
|
|
|
102,583
|
|
|||||
Current portion of long term debt
|
|
116
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
122
|
|
|||||
Total current liabilities
|
|
77,380
|
|
|
9,505
|
|
|
126,079
|
|
|
—
|
|
|
212,964
|
|
|||||
Long-term debt
|
|
691,869
|
|
|
—
|
|
|
162
|
|
|
—
|
|
|
692,031
|
|
|||||
Intercompany payable
|
|
753,933
|
|
|
56,318
|
|
|
—
|
|
|
(810,251
|
)
|
|
—
|
|
|||||
Losses in excess of investment in subsidiaries
|
|
—
|
|
|
—
|
|
|
25,036
|
|
|
(25,036
|
)
|
|
—
|
|
|||||
Other long-term obligations
|
|
8,621
|
|
|
—
|
|
|
52,485
|
|
|
(11,726
|
)
|
|
49,380
|
|
|||||
Total Central Garden & Pet shareholders’ equity (deficit)
|
|
952,449
|
|
|
32,178
|
|
|
1,561,164
|
|
|
(1,593,342
|
)
|
|
952,449
|
|
|||||
Noncontrolling interest
|
|
—
|
|
|
385
|
|
|
—
|
|
|
—
|
|
|
385
|
|
|||||
Total equity
|
|
952,449
|
|
|
32,563
|
|
|
1,561,164
|
|
|
(1,593,342
|
)
|
|
952,834
|
|
|||||
Total
|
|
$
|
2,484,252
|
|
|
$
|
98,386
|
|
|
$
|
1,764,926
|
|
|
$
|
(2,440,355
|
)
|
|
$
|
1,907,209
|
|
|
|
CONSOLIDATING CONDENSED STATEMENT OF CASH FLOWS
|
||||||||||||||||||
|
|
Nine Months Ended June 29, 2019
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non-
Guarantor
Subsidiaries
|
|
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net cash provided by operating activities
|
|
$
|
10,831
|
|
|
$
|
7,468
|
|
|
$
|
74,755
|
|
|
$
|
(250
|
)
|
|
$
|
92,804
|
|
Additions to property and equipment
|
|
(2,705
|
)
|
|
(3,691
|
)
|
|
(14,492
|
)
|
|
—
|
|
|
(20,888
|
)
|
|||||
Payments to acquire companies, net of cash acquired
|
|
(41,158
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(41,158
|
)
|
|||||
Investments
|
|
(1,749
|
)
|
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
(1,758
|
)
|
|||||
Other investing activities
|
|
(453
|
)
|
|
—
|
|
|
(750
|
)
|
|
—
|
|
|
(1,203
|
)
|
|||||
Intercompany investing activities
|
|
7,861
|
|
|
—
|
|
|
5,060
|
|
|
(12,921
|
)
|
|
—
|
|
|||||
Net cash used by investing activities
|
|
(38,204
|
)
|
|
(3,691
|
)
|
|
(10,191
|
)
|
|
(12,921
|
)
|
|
(65,007
|
)
|
|||||
Repayments of long-term debt
|
|
(90
|
)
|
|
—
|
|
|
(46,072
|
)
|
|
—
|
|
|
(46,162
|
)
|
|||||
Repurchase of common stock
|
|
(17,796
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17,796
|
)
|
|||||
Distribution to parent
|
|
—
|
|
|
(250
|
)
|
|
—
|
|
|
250
|
|
|
—
|
|
|||||
Distribution to noncontrolling interest
|
|
—
|
|
|
(64
|
)
|
|
—
|
|
|
—
|
|
|
(64
|
)
|
|||||
Payment of contingent consideration liability
|
|
—
|
|
|
—
|
|
|
(104
|
)
|
|
—
|
|
|
(104
|
)
|
|||||
Intercompany financing activities
|
|
(7,199
|
)
|
|
(5,722
|
)
|
|
—
|
|
|
12,921
|
|
|
—
|
|
|||||
Net cash used by financing activities
|
|
(25,085
|
)
|
|
(6,036
|
)
|
|
(46,176
|
)
|
|
13,171
|
|
|
(64,126
|
)
|
|||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
|
(185
|
)
|
|
15
|
|
|
50
|
|
|
—
|
|
|
(120
|
)
|
|||||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
|
(52,643
|
)
|
|
(2,244
|
)
|
|
18,438
|
|
|
—
|
|
|
(36,449
|
)
|
|||||
Cash, cash equivalents and restricted cash at beginning of period
|
|
485,109
|
|
|
6,005
|
|
|
1,891
|
|
|
—
|
|
|
493,005
|
|
|||||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
432,466
|
|
|
$
|
3,761
|
|
|
$
|
20,329
|
|
|
$
|
—
|
|
|
$
|
456,556
|
|
|
|
CONSOLIDATING CONDENSED STATEMENT OF CASH FLOWS
|
||||||||||||||||||
|
|
Nine Months Ended June 30, 2018
|
||||||||||||||||||
|
|
(in thousands)
|
||||||||||||||||||
|
|
Parent
|
|
Non-Guarantor
Subsidiaries
|
|
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net cash (used) provided by operating activities
|
|
$
|
(20,284
|
)
|
|
$
|
(101
|
)
|
|
$
|
44,534
|
|
|
$
|
(6,387
|
)
|
|
$
|
17,762
|
|
Additions to property, plant and equipment
|
|
(6,508
|
)
|
|
(986
|
)
|
|
(19,509
|
)
|
|
—
|
|
|
(27,003
|
)
|
|||||
Payments to acquire companies, net of cash acquired
|
|
(86,777
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(86,777
|
)
|
|||||
Investments
|
|
(8,048
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,048
|
)
|
|||||
Other investing activities
|
|
(2,655
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,655
|
)
|
|||||
Intercompany investing activities
|
|
(3,737
|
)
|
|
—
|
|
|
(22,671
|
)
|
|
26,408
|
|
|
—
|
|
|||||
Net cash used by investing activities
|
|
(107,725
|
)
|
|
(986
|
)
|
|
(42,180
|
)
|
|
26,408
|
|
|
(124,483
|
)
|
|||||
Repayments under revolving line of credit
|
|
(23,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,000
|
)
|
|||||
Borrowings under revolving line of credit
|
|
23,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23,000
|
|
|||||
Repayments of long-term debt
|
|
(27
|
)
|
|
—
|
|
|
(368
|
)
|
|
—
|
|
|
(395
|
)
|
|||||
Issuance of long-term debt
|
|
300,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
300,000
|
|
|||||
Payment of financing costs
|
|
(4,770
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,770
|
)
|
|||||
Repurchase of common stock
|
|
(12,942
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,942
|
)
|
|||||
Distribution to parent
|
|
—
|
|
|
(6,387
|
)
|
|
—
|
|
|
6,387
|
|
|
—
|
|
|||||
Distribution to noncontrolling interest
|
|
—
|
|
|
(1,597
|
)
|
|
—
|
|
|
—
|
|
|
(1,597
|
)
|
|||||
Payment of contingent consideration
|
|
—
|
|
|
—
|
|
|
(204
|
)
|
|
—
|
|
|
(204
|
)
|
|||||
Intercompany financing activities
|
|
23,997
|
|
|
2,411
|
|
|
—
|
|
|
(26,408
|
)
|
|
—
|
|
|||||
Net cash provided (used) by financing activities
|
|
306,258
|
|
|
(5,573
|
)
|
|
(572
|
)
|
|
(20,021
|
)
|
|
280,092
|
|
|||||
Effect of exchange rates on cash, cash equivalents and restricted cash
|
|
(103
|
)
|
|
27
|
|
|
29
|
|
|
—
|
|
|
(47
|
)
|
|||||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
|
178,146
|
|
|
(6,633
|
)
|
|
1,811
|
|
|
—
|
|
|
173,324
|
|
|||||
Cash, cash equivalents and restricted cash at beginning of period
|
|
31,883
|
|
|
11,693
|
|
|
1,466
|
|
|
—
|
|
|
45,042
|
|
|||||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
210,029
|
|
|
$
|
5,060
|
|
|
$
|
3,277
|
|
|
$
|
—
|
|
|
$
|
218,366
|
|
13.
|
Contingencies
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
Net sales increased $48.7 million, or 7.4%, from the prior year quarter to $706.6 million due primarily to the inclusion of two acquisitions that were not part of the third quarter fiscal 2018 results. Pet segment sales decreased $4.5 million, and Garden segment sales increased $53.2 million.
|
•
|
Organic net sales increased 0.6%. Organic net sales declined 2.3% in our Pet segment and increased 4.1% in our Garden segment.
|
•
|
Gross profit increased $17.2 million, and gross margin increased 30 basis points to 31.0%, due primarily to improvement in the Garden segment.
|
•
|
Selling, general & administrative expense increased $9.2 million to $150.4 million but declined as a percentage of net sales to 21.3%.
|
•
|
Operating income improved $8.1 million from the prior year quarter, to $68.9 million in the third quarter of fiscal 2019, and operating margin improved 50 basis points to 9.7%.
|
•
|
Our net income in the third quarter of fiscal 2019 was $46.2 million, or $0.80 per diluted share, compared to $41.5 million, or $0.79 per diluted share, in the third quarter of fiscal 2018.
|
•
|
Gains from the fair value remeasurement of previously held investment interests: we have excluded the impact of the fair value remeasurement of a previously held investment interest as it represents an infrequent transaction that occurs in limited circumstances that impacts the comparability between operating periods. We believe the adjustment of these gains supplements the GAAP information with a measure that may be used to assess the sustainability of our operating performance.
|
•
|
Asset impairment charges: we have excluded the impact of asset impairments on intangible assets as such non-cash amounts are inconsistent in amount and frequency. We believe that the adjustment of these charges supplements the GAAP information with a measure that can be used to assess the sustainability of our operating performance.
|
•
|
The U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Job Act (the "Tax Reform Act") in December 2017. We have excluded the transitional impact of the Tax Reform Act as the remeasurement of our deferred tax assets and liabilities does not reflect the ongoing impact of the lower U.S. statutory rate on our current year or future year earnings.
|
(1)
|
During the second quarter of fiscal 2019, we recorded a preliminary, pending the finalization of the related purchase accounting, non-cash $3.2 million gain in our Garden segment from the fair value remeasurement of our previously held 45% interest in Arden upon our acquisition of the remaining 55% interest. The gain was recorded as part of selling, general and administrative costs in the condensed consolidated statements of operations.
|
(2)
|
During the second quarter of fiscal 2019, we recognized a non-cash impairment charge in our Pet segment of $2.5 million related to the impairment of intangible assets caused by a retail customer exiting the live fish business. The adjustment was recorded as part of selling, general and administrative costs.
|
(3)
|
Transitional impact of U.S. Tax Reform: As a result of the Tax Reform Act, the Company recorded a provisional tax benefit of $16.3 million in the first quarter of fiscal 2018, due to the remeasurement of its deferred tax assets and liabilities. We have excluded only this transitional impact and have not included in the adjustment the ongoing impact of the lower U.S. statutory rate on our current or future year earnings.
|
Operating Income Reconciliation
|
|
GAAP to Non-GAAP Reconciliation
(in thousands) For the Nine Months Ended |
||||||
|
|
Consolidated
|
||||||
|
|
June 29, 2019
|
|
June 30, 2018
|
||||
GAAP operating income
|
|
$
|
141,205
|
|
|
$
|
149,126
|
|
Previously held investment interest fair value remeasurement
|
(1)
|
(3,215
|
)
|
|
—
|
|
||
Intangible asset impairment
|
(2)
|
2,540
|
|
|
—
|
|
||
Non-GAAP operating income
|
|
$
|
140,530
|
|
|
$
|
149,126
|
|
Pet Segment Operating Income Reconciliation
|
|
GAAP to Non-GAAP Reconciliation
(in thousands) For the Nine Months Ended |
||||||
|
|
Pet
|
||||||
|
|
June 29, 2019
|
|
June 30, 2018
|
||||
GAAP operating income
|
|
$
|
91,805
|
|
|
$
|
108,202
|
|
Intangible asset impairment
|
(2)
|
2,540
|
|
|
—
|
|
||
Non-GAAP operating income
|
|
$
|
94,345
|
|
|
$
|
108,202
|
|
Garden Segment Operating Income Reconciliation
|
|
GAAP to Non-GAAP Reconciliation
(in thousands) For the Nine Months Ended |
||||||
|
|
Garden
|
||||||
|
|
June 29, 2019
|
|
June 30, 2018
|
||||
GAAP operating income
|
|
$
|
101,821
|
|
|
$
|
93,975
|
|
Previously held investment interest fair value remeasurement
|
(1)
|
(3,215
|
)
|
|
—
|
|
||
Non-GAAP operating income
|
|
$
|
98,606
|
|
|
$
|
93,975
|
|
|
|
GAAP to Non-GAAP Reconciliation
(in thousands, except per share amounts) For the Nine Months Ended |
||||||
Net Income and Diluted Net Income Per Share Reconciliation
|
|
June 29, 2019
|
|
June 30, 2018
|
||||
GAAP net income attributable to Central Garden & Pet
|
|
$
|
90,346
|
|
|
$
|
113,026
|
|
Previously held investment interest fair value remeasurement
|
(1)
|
(3,215
|
)
|
|
—
|
|
||
Intangible asset impairment
|
(2)
|
2,540
|
|
|
—
|
|
||
Tax effect of remeasurement and impairment
|
|
151
|
|
|
—
|
|
||
Tax effect of revaluation of deferred tax amounts
|
(3)
|
—
|
|
|
16,343
|
|
||
Non-GAAP net income attributable to Central Garden & Pet
|
|
$
|
89,822
|
|
|
$
|
96,683
|
|
GAAP diluted net income per share
|
|
$
|
1.56
|
|
|
$
|
2.15
|
|
Non-GAAP diluted net income per share
|
|
$
|
1.55
|
|
|
$
|
1.84
|
|
Shares used in GAAP and non-GAAP diluted net earnings per share calculation
|
|
57,937
|
|
|
52,670
|
|
|
|
GAAP to Non-GAAP Reconciliation
(in millions) For the Nine Months Ended June 29, 2019 |
|||||||||||||||||||
|
|
Consolidated
|
|
Pet Segment
|
|
Garden Segment
|
|||||||||||||||
|
|
|
|
Percent change
|
|
|
|
Percent change
|
|
|
|
Percent change
|
|||||||||
Reported net sales - Q3 FY19 YTD (GAAP)
|
|
$
|
1,842.3
|
|
|
|
|
$
|
1,028.8
|
|
|
|
|
$
|
813.5
|
|
|
|
|||
Reported net sales - Q3 FY18 YTD (GAAP)
|
|
1,713.0
|
|
|
|
|
1,001.5
|
|
|
|
|
711.5
|
|
|
|
||||||
Increase in net sales
|
|
129.3
|
|
|
7.5
|
%
|
|
27.3
|
|
|
2.7
|
%
|
|
102.0
|
|
|
14.3
|
%
|
|||
Effect of acquisition and divestitures on increase in net sales
|
|
119.5
|
|
|
|
|
37.2
|
|
|
|
|
82.3
|
|
|
|
||||||
Increase (decrease) in organic net sales - Q3 2019 YTD
|
|
$
|
9.8
|
|
|
0.6
|
%
|
|
$
|
(9.9
|
)
|
|
(1.0
|
)%
|
|
$
|
19.7
|
|
|
2.8
|
%
|
EBITDA Reconciliation
|
|
GAAP to Non-GAAP Reconciliation
(in thousands, except per share amounts) For the Three Months Ended June 29, 2019 |
||||||||||||||
|
|
Garden
|
|
Pet
|
|
Corp
|
|
Total
|
||||||||
Net income attributable to Central Garden & Pet
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
46,152
|
|
|||
Interest expense, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,498
|
|
||||
Other income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(180
|
)
|
||||
Income tax expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,212
|
|
||||
Net income attributable to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
189
|
|
||||
Sum of items below operating income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22,719
|
|
||||
Income (loss) from operations
|
|
$
|
53,103
|
|
|
$
|
35,066
|
|
|
$
|
(19,298
|
)
|
|
$
|
68,871
|
|
Depreciation & amortization
|
|
3,497
|
|
|
8,083
|
|
|
1,502
|
|
|
13,082
|
|
||||
EBITDA
|
|
$
|
56,600
|
|
|
$
|
43,149
|
|
|
$
|
(17,796
|
)
|
|
$
|
81,953
|
|
EBITDA Reconciliation
|
|
GAAP to Non-GAAP Reconciliation
(in thousands, except per share amounts) For the Three Months Ended June 30, 2018 |
||||||||||||||
|
|
Garden
|
|
Pet
|
|
Corp
|
|
Total
|
||||||||
Net income attributable to Central Garden & Pet
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
41,545
|
|
|||
Interest expense, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,013
|
|
||||
Other income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,126
|
)
|
||||
Income tax expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,395
|
|
||||
Net income attributable to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
||||
Sum of items below operating income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,274
|
|
||||
Income (loss) from operations
|
|
$
|
40,929
|
|
|
$
|
39,242
|
|
|
$
|
(19,352
|
)
|
|
$
|
60,819
|
|
Depreciation & amortization
|
|
2,789
|
|
|
7,626
|
|
|
2,172
|
|
|
12,587
|
|
||||
EBITDA
|
|
$
|
43,718
|
|
|
$
|
46,868
|
|
|
$
|
(17,180
|
)
|
|
$
|
73,406
|
|
EBITDA Reconciliation
|
|
GAAP to Non-GAAP Reconciliation
(in thousands, except per share amounts) For the Nine Months Ended June 29, 2019 |
||||||||||||||
|
|
Garden
|
|
Pet
|
|
Corp
|
|
Total
|
||||||||
Net income attributable to Central Garden & Pet
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
90,346
|
|
|||
Interest expense, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24,960
|
|
||||
Other income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(488
|
)
|
||||
Income tax benefit
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26,031
|
|
||||
Net income attributable to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
356
|
|
||||
Sum of items below operating income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
50,859
|
|
||||
Income (loss) from operations
|
|
$
|
101,821
|
|
|
$
|
91,805
|
|
|
$
|
(52,421
|
)
|
|
$
|
141,205
|
|
Depreciation & amortization
|
|
8,635
|
|
|
24,178
|
|
|
4,498
|
|
|
37,311
|
|
||||
EBITDA
|
|
$
|
110,456
|
|
|
$
|
115,983
|
|
|
$
|
(47,923
|
)
|
|
$
|
178,516
|
|
EBITDA Reconciliation
|
|
GAAP to Non-GAAP Reconciliation
(in thousands, except per share amounts) For the Nine Months Ended June 30, 2018 |
||||||||||||||
|
|
Garden
|
|
Pet
|
|
Corp
|
|
Total
|
||||||||
Net income attributable to Central Garden & Pet
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
113,026
|
|
|||
Interest expense, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27,113
|
|
||||
Other income (expense)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(542
|
)
|
||||
Income tax benefit
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,802
|
|
||||
Net income attributable to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
727
|
|
||||
Sum of items below operating income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
36,100
|
|
||||
Income (loss) from operations
|
|
$
|
93,975
|
|
|
$
|
108,202
|
|
|
$
|
(53,051
|
)
|
|
$
|
149,126
|
|
Depreciation & amortization
|
|
6,065
|
|
|
21,715
|
|
|
7,092
|
|
|
34,872
|
|
||||
EBITDA
|
|
$
|
100,040
|
|
|
$
|
129,917
|
|
|
$
|
(45,959
|
)
|
|
$
|
183,998
|
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 4.
|
Controls and Procedures
|
Item 1.
|
Legal Proceedings
|
Item 1A.
|
Risk Factors
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
Period
|
|
Total Number
of Shares
(or Units)
Purchased
|
|
|
|
Average
Price Paid
per Share
(or Units)
|
|
Total Number
of Shares
(or Units)
Purchased as
Part of Publicly
Announced Plans
or Programs
|
|
Maximum Number (or
Approximate Dollar Value)
of Shares
(or Units)
that May Yet Be Purchased
Under the Plans or
Programs (1)
|
||||||
March 31, 2019 - May 4, 2019
|
|
667
|
|
|
(2)
|
|
$
|
25.07
|
|
|
—
|
|
|
$
|
34,968,000
|
|
May 5, 2019 - June 1, 2019
|
|
240,653
|
|
|
(3)
|
|
$
|
26.49
|
|
|
216,823
|
|
|
$
|
29,216,000
|
|
June 2, 2019 - June 29, 2019
|
|
338,603
|
|
|
|
|
$
|
25.26
|
|
|
338,603
|
|
|
$
|
20,662,000
|
|
Total
|
|
579,923
|
|
|
|
|
$
|
25.77
|
|
|
555,426
|
|
|
$
|
20,662,000
|
|
(1)
|
During the third quarter of fiscal 2011, our Board of Directors authorized a $100 million share repurchase program. The program has no expiration date and expires when the amount authorized has been used or the Board withdraws its authorization. The repurchase of shares may be limited by certain financial covenants in our credit facility and indenture that restrict our ability to repurchase our stock.
|
(2)
|
Shares purchased during the period indicated represent withholding of a portion of shares to cover taxes in connection with the vesting of restricted stock.
|
(3)
|
Includes 23,830 shares purchased during the period indicated that represent withholding of a portion of shares to cover taxes in connection with the vesting of restricted stock.
|
Item 3.
|
Defaults Upon Senior Securities
|
Item 4.
|
Mine Safety Disclosures
|
Item 5.
|
Other Information
|
|
CENTRAL GARDEN & PET COMPANY
|
|
Registrant
|
|
|
|
Dated: August 2, 2019
|
|
|
|
/s/ GEORGE C. ROETH
|
|
George C. Roeth
|
|
President and Chief Executive Officer
|
|
(Principal Executive Officer)
|
|
|
|
/s/ NICHOLAS LAHANAS
|
|
Nicholas Lahanas
|
|
Chief Financial Officer
|
|
(Principal Financial Officer)
|
1.
|
I have reviewed this report on Form 10-Q for the quarter ended June 29, 2019 of Central Garden & Pet Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ GEORGE C. ROETH
|
|
George C. Roeth
|
|
President and Chief Executive Officer
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this report on Form 10-Q for the quarter ended June 29, 2019 of Central Garden & Pet Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ Nicholas Lahanas
|
|
Nicholas Lahanas
|
|
Chief Financial Officer
|
|
(Principal Financial Officer)
|
(1)
|
such Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in such Report presents, in all material respects, the financial condition and results of operations of Central Garden & Pet Company.
|
|
/s/ GEORGE C. ROETH
|
|
George C. Roeth
|
|
President and Chief Executive Officer
|
|
(Principal Executive Officer)
|
(1)
|
such Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in such Report presents, in all material respects, the financial condition and results of operations of Central Garden & Pet Company.
|
|
/s/ NICHOLAS LAHANAS
|
|
Nicholas Lahanas
|
|
Chief Financial Officer
|
|
(Principal Financial Officer)
|