10-Q 1 midd-20240928.htm 10-Q midd-20240928
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UNITED STATES
 
SECURITIES AND EXCHANGE COMMISSION
 
Washington, D.C. 20549
 
FORM 10-Q 
 
(Mark One)
Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the quarterly period ended September 28, 2024
or
Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Commission File No. 1-9973
 
THE MIDDLEBY CORPORATION
(Exact name of registrant as specified in its charter)  
Delaware36-3352497
(State or other jurisdiction of incorporation or organization)(IRS Employer Identification Number)
 
1400 Toastmaster Drive,Elgin,Illinois60120
(Address of principal executive offices)(Zip Code)
Registrant's telephone number, including area code:(847)741-3300
 
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes x No o   
 
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes x   No o
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “accelerated filer," "large accelerated filer," "smaller reporting company," and "emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filerNon-accelerated filer
Smaller reporting companyEmerging growth company
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading Symbol(s)Name of Each Exchange on Which Registered
Common StockMIDDNasdaq Global Select Market
As of November 4, 2024, there were 53,793,158 shares of the registrant's common stock outstanding.



THE MIDDLEBY CORPORATION
 
QUARTER ENDED SEPTEMBER 28, 2024
  
INDEX
DESCRIPTIONPAGE
PART I.  FINANCIAL INFORMATION 
  
Item 1. 
   
 CONDENSED CONSOLIDATED BALANCE SHEETS as of SEPTEMBER 28, 2024 and DECEMBER 30, 2023
  
 CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME for the three and nine months ended SEPTEMBER 28, 2024 and SEPTEMBER 30, 2023
  
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY for the three and nine months ended SEPTEMBER 28, 2024 and SEPTEMBER 30, 2023
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS for the nine months ended SEPTEMBER 28, 2024 and SEPTEMBER 30, 2023
 
  
Item 2.
  
Item 3.
  
Item 4.
  
PART II. OTHER INFORMATION
  
Item 2.
  
Item 6.



PART I. FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements

THE MIDDLEBY CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share Data)
(Unaudited)
 
ASSETSSep 28, 2024Dec 30, 2023
Current assets:  
Cash and cash equivalents$606,004 $247,496 
Accounts receivable, net of reserve for doubtful accounts of $24,053 and $23,464
614,976 644,576 
Inventories, net905,865 935,867 
Prepaid expenses and other134,364 112,690 
Prepaid taxes30,401 25,230 
Total current assets2,291,610 1,965,859 
Property, plant and equipment, net of accumulated depreciation of $377,548 and $339,528
510,555 510,898 
Goodwill2,506,810 2,486,310 
Other intangibles, net of amortization of $625,286 and $574,079
1,650,962 1,693,076 
Long-term deferred tax assets6,915 7,945 
Pension benefits assets54,887 38,535 
Other assets179,342 204,069 
Total assets$7,201,081 $6,906,692 
LIABILITIES AND STOCKHOLDERS' EQUITY  
Current liabilities:  
Current maturities of long-term debt$44,058 $44,822 
Accounts payable214,699 227,080 
Accrued expenses555,955 579,192 
Total current liabilities814,712 851,094 
Long-term debt2,361,252 2,380,373 
Long-term deferred tax liability241,107 216,143 
Accrued pension benefits11,665 12,128 
Other non-current liabilities179,404 197,065 
Stockholders' equity:  
Preferred stock, $0.01 par value; nonvoting; 2,000,000 shares authorized; none issued
  
Common stock, $0.01 par value; 64,227,987 and 63,942,340 shares issued in 2024 and 2023, respectively
148 148 
Paid-in capital509,355 479,216 
Treasury stock, at cost; 10,456,948 and 10,338,922 shares in 2024 and 2023, respectively
(924,289)(906,031)
Retained earnings4,215,883 3,899,754 
Accumulated other comprehensive loss(208,156)(223,198)
Total stockholders' equity3,592,941 3,249,889 
Total liabilities and stockholders' equity$7,201,081 $6,906,692 
 

See accompanying notes
1



THE MIDDLEBY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In Thousands, Except Per Share Data)
(Unaudited)
 
 
 Three Months EndedNine Months Ended
 Sep 28, 2024Sep 30, 2023Sep 28, 2024Sep 30, 2023
Net sales$942,809 $980,651 $2,861,281 $3,028,029 
Cost of sales587,375 605,329 1,779,847 1,880,736 
Gross profit355,434 375,322 1,081,434 1,147,293 
Selling, general and administrative expenses179,476 196,433 584,108 615,361 
Restructuring expenses2,519 4,448 11,046 11,698 
Income from operations173,439 174,441 486,280 520,234 
Interest expense and deferred financing amortization, net21,399 31,080 72,239 92,071 
Net periodic pension benefit (other than service costs)(3,876)(2,103)(11,244)(6,929)
Other expense (income), net1,239 1,072 995 2,642 
Earnings before income taxes154,677 144,392 424,290 432,450 
Provision for income taxes40,511 35,742 108,161 107,861 
Net earnings$114,166 $108,650 $316,129 $324,589 
Net earnings per share:  
Basic$2.12 $2.03 $5.88 $6.06 
Diluted$2.11 $2.01 $5.84 $5.99 
Weighted average number of shares  
Basic53,770 53,588 53,730 53,569 
Dilutive common stock equivalents267 569 438 623 
Diluted54,037 54,157 54,168 54,192 
Comprehensive income$162,648 $76,504 $331,171 $317,203 
 

















See accompanying notes
2


THE MIDDLEBY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(amounts in thousands)
(Unaudited)
Common
Stock
Paid-in
Capital
Treasury
Stock
Retained
Earnings
Accumulated
Other
Comprehensive
Income/(loss)
Total
Stockholders'
Equity
Balance, June 29, 2024$148 $500,686 $(924,002)$4,101,717 $(256,638)$3,421,911 
Net earnings   114,166  114,166 
Currency translation adjustments    67,366 67,366 
Change in unrecognized pension benefit costs, net of tax of $464
    (5,711)(5,711)
Unrealized loss on interest rate swap, net of tax of $(4,120)
    (13,173)(13,173)
Stock compensation 8,669    8,669 
Purchase of treasury stock  (287)  (287)
Balance, September 28, 2024$148 $509,355 $(924,289)$4,215,883 $(208,156)$3,592,941 
Balance, December 30, 2023$148 $479,216 $(906,031)$3,899,754 $(223,198)$3,249,889 
Net earnings   316,129  316,129 
Currency translation adjustments    31,352 31,352 
Change in unrecognized pension benefit costs, net of tax of $800
    (4,136)(4,136)
Unrealized loss on interest rate swap, net of tax of $(4,976)
    (12,174)(12,174)
Stock compensation 30,139    30,139 
Purchase of treasury stock  (18,258)  (18,258)
Balance, September 28, 2024$148 $509,355 $(924,289)$4,215,883 $(208,156)$3,592,941 
Common
Stock
Paid-in
Capital
Treasury
Stock
Retained
Earnings
Accumulated
Other
Comprehensive
Income/(loss)
Total
Stockholders'
Equity
Balance, July 1, 2023$148 $444,290 $(906,011)$3,714,811 $(253,712)$2,999,526 
Net earnings   108,650  108,650 
Currency translation adjustments    (36,602)(36,602)
Change in unrecognized pension benefit costs, net of tax of $367
    4,436 4,436 
Unrealized gain on interest rate swap, net of tax of $7
    20 20 
Stock compensation 13,175    13,175 
Stock issuance 6,010    6,010 
Balance, September 30, 2023$148 $463,475 $(906,011)$3,823,461 $(285,858)$3,095,215 
Balance, December 31, 2022$147 $408,376 $(831,176)$3,498,872 $(278,472)$2,797,747 
Net earnings   324,589  324,589 
Currency translation adjustments    (4,751)(4,751)
Change in unrecognized pension benefit costs, net of tax of $461
    (544)(544)
Unrealized loss on interest rate swap, net of tax of $(731)
    (2,091)(2,091)
Stock compensation 35,305    35,305 
Stock issuance1 19,794    19,795 
Purchase of treasury stock  (74,835)  (74,835)
Balance, September 30, 2023$148 $463,475 $(906,011)$3,823,461 $(285,858)$3,095,215 

See accompanying notes
3


THE MIDDLEBY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)
 Nine Months Ended
 Sep 28, 2024Sep 30, 2023
Cash flows from operating activities--  
Net earnings$316,129 $324,589 
Adjustments to reconcile net earnings to net cash provided by operating activities--  
Depreciation and amortization94,836 99,058 
Non-cash share-based compensation30,139 35,305 
Deferred income taxes27,659 (6,553)
Net periodic pension benefit (other than service costs)(11,244)(6,929)
Other non-cash items661 (684)
Changes in assets and liabilities, net of acquisitions  
Accounts receivable, net31,354 (430)
Inventories, net33,045 66,973 
Prepaid expenses and other assets(20,073)(2,481)
Accounts payable(13,706)(49,188)
Accrued expenses and other liabilities(41,718)(86,557)
Net cash provided by operating activities447,082 373,103 
Cash flows from investing activities--  
Net additions to property, plant and equipment(36,169)(69,645)
Purchase of intangible assets(80)(1,805)
Acquisitions, net of cash acquired(7,750)(67,774)
Net cash used in investing activities(43,999)(139,224)
Cash flows from financing activities--  
Proceeds under Credit Facility 565,200 
Repayments under Credit Facility(21,875)(711,692)
Net repayments under foreign bank loan(1,611)(495)
Payments of deferred purchase price(3,878)(4,079)
Repurchase of treasury stock(18,258)(74,544)
Other, net(167)(158)
Net cash used in financing activities(45,789)(225,768)
Effect of exchange rates on cash and cash equivalents1,214 (2,923)
Changes in cash and cash equivalents--  
Net increase (decrease) in cash and cash equivalents358,508 5,188 
Cash and cash equivalents at beginning of year247,496 162,001 
Cash and cash equivalents at end of period$606,004 $167,189 
Non-cash investing and financing activities:
Stock issuance related to acquisition and purchase of intangible assets$ $19,795 
 

See accompanying notes
4


THE MIDDLEBY CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 28, 2024
(Unaudited)
1)Summary of Significant Accounting Policies
a)Basis of Presentation
The condensed consolidated financial statements have been prepared by The Middleby Corporation (the "company" or “Middleby”), pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). The financial statements are unaudited and certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although the company believes that the disclosures are adequate to make the information not misleading. These financial statements should be read in conjunction with the financial statements and related notes contained in the company's 2023 Form 10-K. The company’s interim results are not necessarily indicative of future full year results for the fiscal year 2024.
In the opinion of management, the financial statements contain all adjustments, which are normal and recurring in nature, necessary to present fairly the financial position of the company as of September 28, 2024 and December 30, 2023, the results of operations for the three and nine months ended September 28, 2024 and September 30, 2023, cash flows for the nine months ended September 28, 2024 and September 30, 2023 and statement of stockholders' equity for the three and nine months ended September 28, 2024 and September 30, 2023.
Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires the company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses. Significant estimates and assumptions are used for, but are not limited to, allowances for doubtful accounts, reserves for excess and obsolete inventories, long-lived and intangible assets, warranty reserves, insurance reserves, income tax reserves, non-cash share-based compensation and post-retirement obligations. Such estimates and assumptions could change in the future as more information becomes known, which could impact the amounts reported and disclosed in the notes herein.
b)Non-Cash Share-Based Compensation
The company estimates the fair value of market-based stock awards and stock options at the time of grant and recognizes compensation cost over the vesting period of the awards and options. Non-cash share-based compensation expense was $8.7 million and $13.2 million for the three months period ended September 28, 2024 and September 30, 2023, respectively. Non-cash share-based compensation expense was $30.1 million and $35.3 million for the nine months period ended September 28, 2024 and September 30, 2023, respectively.
c)Income Taxes
A tax provision of $40.5 million, at an effective rate of 26.2%, was recorded during the three months period ended September 28, 2024, as compared to a $35.7 million tax provision at an effective rate of 24.8% in the prior year period. A tax provision of $108.2 million, at an effective rate of 25.5%, was recorded during the nine months period ended September 28, 2024 as compared to a $107.9 million tax provision at an effective rate of 24.9% in the prior year period. The effective tax rate for the three months period ended September 28, 2024 is higher than the U.S. statutory tax rate of 21.0% primarily due to state taxes and foreign tax rate differentials.

5


d)Fair Value Measures 
Accounting Standards Codification ("ASC") 820 "Fair Value Measurements and Disclosures" defines fair value as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into the following levels:
Level 1 – Quoted prices in active markets for identical assets or liabilities.
Level 2 – Inputs, other than quoted prices in active markets, that are observable either directly or indirectly.
Level 3 – Unobservable inputs based the company's own assumptions.

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.
The company’s financial assets and liabilities that are measured at fair value and are categorized using the fair value hierarchy are as follows (in thousands):
Fair Value
Level 1
Fair Value
Level 2
Fair Value
Level 3
Total
As of September 28, 2024
Financial Assets:
 Interest rate swaps$ $25,629 $ $25,629 
   Foreign exchange derivative contracts$ $55 $ $55 
Financial Liabilities:
    Contingent consideration$ $ $44,311 $44,311 
As of December 30, 2023
Financial Assets:
    Interest rate swaps$ $42,779 $ $42,779 
 Foreign exchange derivative contracts$ $29 $ $29 
Financial Liabilities:
    Contingent consideration$ $ $51,538 $51,538 
The contingent consideration as of September 28, 2024 and December 30, 2023, relates to the earnout provisions recorded in conjunction with various purchase agreements.
Earn-out liabilities are classified within Level 3 in the fair value hierarchy, as the methodology used to estimate fair value includes significant unobservable inputs reflecting management’s own assumptions. The earnout provisions associated with these acquisitions are based upon performance measurements related to sales and earnings, as defined in the respective purchase agreement. On a quarterly basis, the company assesses the projected results for each of the acquisitions in comparison to the earnout targets and adjusts the liability accordingly. Discount rates for valuing contingent consideration are determined based on the company rates and specific acquisition risk considerations. Changes in fair value associated with the earnout provisions are recognized in Selling, general and administrative expenses within the Condensed Consolidated Statements of Comprehensive Income.
The following table represents changes in the fair value of the contingent consideration liabilities:

September 28, 2024
Beginning balance$51,538 
Payments of contingent consideration(4,141)
Changes in fair value(3,086)
Ending balance$44,311 


6


e)    Consolidated Statements of Cash Flows
Cash paid for interest was $75.6 million and $93.4 million for the nine months ended September 28, 2024 and September 30, 2023, respectively. Cash payments totaling $83.3 million and $119.4 million were made for income taxes for the nine months ended September 28, 2024 and September 30, 2023, respectively.
Other non-cash items in the adjustments to reconcile net earnings to net cash provided by operating activities consists primarily of unrealized foreign exchange on non-functional currency third party debt.
f)    Earnings Per Share
“Basic earnings per share” is calculated based upon the weighted average number of common shares actually outstanding, and “diluted earnings per share” is calculated based upon the weighted average number of common shares outstanding and other dilutive securities.
The company’s potentially dilutive securities consist of shares issuable on vesting of restricted stock grants computed using the treasury method and amounted to 24,000 and 19,000 for the three months ended September 28, 2024 and September 30, 2023, respectively.
The company’s potentially dilutive securities consist of shares issuable on vesting of restricted stock grants computed using the treasury method and amounted to 11,000 and 9,000 for the nine months ended September 28, 2024 and September 30, 2023, respectively.
For the nine months ended September 28, 2024 and September 30, 2023, the average market price of the company's common stock exceeded the exercise price of the Convertible Notes (as defined below) resulting in 427,000 and 614,000 diluted common stock equivalents to be included in the diluted net earnings per share, respectively. There have been no material conversions to date. See Note 12, Financing Arrangements for further details on the Convertible Notes. There were no anti-dilutive restricted stock grants excluded from common stock equivalents in any period presented.
7


2)    Acquisitions and Purchase Accounting
The company accounts for all business combinations using the acquisition method to record a new cost basis for the assets acquired and liabilities assumed. The difference between the purchase price and the fair value of the assets acquired and liabilities assumed has been recorded as goodwill in the financial statements. The company recognizes identifiable intangible assets, primarily trade names and customer relationships, at their fair value using a discounted cash flow model. The significant assumptions used to estimate the value of the intangible assets include revenue growth rates, projected profit margins, discount rates, royalty rates, and customer attrition rates. These significant assumptions are forward-looking and could be affected by future economic and market conditions. The results of operations are reflected in the consolidated financial statements of the company from the dates of acquisition.
2023 Acquisitions
During 2023, the company completed various acquisitions that were not individually material. The final allocation of consideration paid for the 2023 acquisitions is summarized as follows (in thousands):
Preliminary Opening Balance SheetMeasurement
Period
Adjustments
Adjusted Opening Balance Sheet
Cash$3,102 $ $3,102 
Current assets9,964 11 9,975 
Property, plant and equipment21,954 (214)21,740 
Goodwill38,422 3,278 41,700 
Other intangibles34,337 (722)33,615 
Other assets 5 5 
Current liabilities(3,774)(1,147)(4,921)
Long-term deferred tax liability(958)23 (935)
Other non-current liabilities(12,099)(216)(12,315)
Consideration paid at closing$90,948 $1,018 $91,966 
Contingent consideration14,743 216 14,959 
Net assets acquired and liabilities assumed$105,691 $1,234 $106,925 
The net long-term deferred tax liability amounted to $0.9 million. The net deferred tax liability is comprised of $0.3 million related to the difference between the book and tax basis of identifiable intangible assets and $0.6 million related to the difference between the book and tax basis on identifiable tangible asset and liability accounts.
The goodwill and $17.9 million of other intangibles associated with the trade names are subject to the non-amortization provisions of ASC 350. Other intangibles also include $7.2 million allocated to customer relationships, $7.9 million allocated to developed technology, and $0.6 million allocated to backlog, which are being amortized over periods of 7 years, 7 to 12 years, and 9 months, respectively. Goodwill of $18.0 million and other intangibles of $7.8 million are allocated to the Food Processing Equipment Group for segment reporting purposes. Goodwill of $9.9 million and other intangibles of $14.1 million are allocated to the Commercial Foodservice Equipment Group for segment reporting purposes. Goodwill of $13.8 million and other intangibles of $11.7 million are allocated to the Residential Kitchen Equipment Group for segment reporting purposes. Of these assets, goodwill of $40.0 million and intangibles of $32.2 million are expected to be deductible for tax purposes.
Four purchase agreements include earnout provisions providing for a contingent payment due to the sellers for the achievement of certain targets. Four earnouts are payable to the extent certain sales and EBITDA targets are met with measurement dates ending between 2024 and 2026. One earnout is payable upon the achievement of certain product rollout targets specific to the year of measurement. The contractual obligation associated with the contingent earnout provisions recognized on the acquisition date amount to $15.0 million.
8


2024 Acquisitions
During 2024, the company completed various acquisitions that were not individually material. The following estimated fair values of assets acquired and liabilities assumed are based on the information that was available as of the acquisition date for the 2024 acquisitions and are summarized as follows (in thousands):
Preliminary Opening Balance SheetPreliminary Measurement
Period
Adjustments
Adjusted Opening Balance Sheet
Cash$1 $ $1 
Current assets1,676 222 1,898 
Property, plant and equipment383 (84)299 
Goodwill945 (114)831 
Other intangibles568  568 
Other assets 938 938 
Current liabilities(222)(195)(417)
Other non-current liabilities (767)(767)
Net assets acquired and liabilities assumed$3,351 $ $3,351 
The goodwill and $0.3 million of other intangibles associated with the trade name are subject to the non-amortization provisions of ASC 350. Other intangibles also include $0.3 million allocated to customer relationships, which is being amortized over a period of 5 years. Goodwill of $0.8 million and other intangibles of $0.6 million are allocated to the Food Processing Equipment Group for segment reporting purposes. Of these assets, goodwill of $0.3 million and intangibles of $0.6 million are expected to be deductible for tax purposes.
The company believes that information gathered to date provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, but the company is waiting for additional information necessary to finalize those fair values for the acquisitions completed during 2024. Certain intangible assets are preliminarily valued using historical information from the Food Processing Equipment Group and qualitative assessment of the business at acquisition date. Specifically, the company estimated the fair values of the intangible assets based on the percentage of purchase price assigned to similar intangible assets in previous acquisitions. Thus, the provisional measurements of fair values set forth above are subject to change. The company expects to complete the purchase price allocation as soon as practicable but no later than one year from the acquisition date.
Pro Forma Financial Information
 
In accordance with ASC 805 Business Combinations, the following unaudited pro forma results of operations for the nine months ended September 28, 2024 and September 30, 2023, assumes the 2023 and 2024 acquisitions described above were completed on January 1, 2023 (first day of fiscal year 2023). The following pro forma results include adjustments to reflect amortization of intangibles associated with the acquisitions and the effects of adjustments made to the carrying value of certain assets (in thousands, except per share data): 
Nine Months Ended
 September 28, 2024September 30, 2023
Net sales$2,861,371 $3,043,925 
Net earnings316,379 323,323 
Net earnings per share:  
Basic$5.89 $6.04 
Diluted$5.84 $5.97 
 
9


The historical consolidated financial information of the company and the acquisitions have been adjusted in the pro forma information to give effect to events that are (1) directly attributable to the transactions, (2) factually supportable and (3) expected to have a continuing impact on the combined results. Pro forma data may not be indicative of the results that would have been obtained had these acquisitions occurred at the beginning of the periods presented, nor is it intended to be a projection of future results. Additionally, the pro forma financial information does not reflect the costs which the company has incurred or may incur to integrate the acquired businesses.
3)    Litigation Matters
Legal Proceedings and Contingencies.
From time to time, the company is subject to proceedings, lawsuits and other claims related to products, suppliers, employees, customers and competitors. The company maintains insurance to partially cover product liability, workers compensation, property and casualty, and general liability matters. The company is required to assess the likelihood of any adverse judgments or outcomes to these matters as well as potential ranges of probable losses.
A determination of the amount of accrual required, if any, for these contingencies is made after assessment of each matter and the related insurance coverage. The required accrual may change in the future due to new developments or changes in approach, such as a change in settlement strategy in dealing with these matters. The company does not believe that any pending litigation will have a material adverse effect on its financial condition, results of operations or cash flows.
4)    Recently Issued Accounting Standards
In November 2023, the FASB issued Accounting Standard Update ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendment requires disclosure of significant segment expenses that are regularly provided to the chief operating decision maker, as well as disclosure of the title and position of the Chief Operating Decision Maker (“CODM”). This guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted and the amendments in this update are required to be applied on a retrospective basis. The company is currently evaluating the impact the adoption of this guidance will have on its Consolidated Financial Statements and disclosures.
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU includes amendments requiring enhanced income tax disclosures, primarily related to standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. The guidance is effective for fiscal years beginning after December 15, 2024, with early adoption permitted, and should be applied either prospectively or retrospectively. The company is currently evaluating the impact the adoption of this guidance will have on its Consolidated Financial Statements and disclosures.
In March 2024, the Securities and Exchange Commission ("SEC") issued its final climate disclosure rules. The rules require disclosure of climate-related information outside of the audited financial statements and disclosure in the footnotes addressing specified financial statement effects of severe weather events and other natural conditions above certain financial thresholds, certain carbon offsets and renewable energy credits or certificates, if material.
In April 2024, the SEC determined to voluntarily stay the final rules pending certain legal challenges. The company is currently evaluating the impact of adoption for the new rules and intends to include the updated climate-related disclosures in future filings when required.
10


5)    Revenue Recognition

Disaggregation of Revenue

The company disaggregates its net sales by reportable operating segment and geographical location as the company believes it best depicts how the nature, timing and uncertainty of its net sales and cash flows are affected by economic factors. In general, the Commercial Foodservice Equipment and Residential Foodservice Equipment Groups recognize revenue at the point in time control transfers to their customers based on contractual shipping terms. Revenue from equipment sold under the company's long-term contracts within the Food Processing Equipment group is recognized over time as the equipment is manufactured and assembled. The following table summarizes the company's net sales by reportable operating segment and geographical location (in thousands):
 Commercial
 Foodservice
Food ProcessingResidential Kitchen Total
Three Months Ended September 28, 2024   
United States and Canada$419,515 $103,391 $112,912 $635,818 
Asia53,725 7,437 5,994 67,156 
Europe and Middle East99,494 45,280 52,952 197,726 
Latin America27,334 13,415 1,360 42,109 
Total$600,068 $169,523 $173,218 $942,809 
Nine Months Ended September 28, 2024   
United States and Canada$1,288,437 $315,080 $344,731 $1,948,248 
Asia161,104 20,756 12,433 194,293 
Europe and Middle East288,225 137,459 176,577 602,261 
Latin America72,024 38,315 6,140 116,479 
Total$1,809,790 $511,610 $539,881 $2,861,281 
Three Months Ended September 30, 2023
United States and Canada$458,529 $111,092 $116,522 $686,143 
Asia59,922 6,389 3,371 69,682 
Europe and Middle East91,112 34,250 57,474 182,836 
Latin America24,446 14,936 2,608 41,990 
Total$634,009 $166,667 $179,975 $980,651 
Nine Months Ended September 30, 2023
United States and Canada$1,385,929 $354,945 $395,236 $2,136,110 
Asia173,901 30,507 8,652 213,060 
Europe and Middle East272,252 101,808 194,631 568,691 
Latin America61,525 41,658 6,985 110,168 
Total$1,893,607 $528,918 $605,504 $3,028,029 


11


Contract Balances

Contract assets primarily relate to the company's right to consideration for work completed but not billed at the reporting date and are recorded in prepaid expenses and other in the Condensed Consolidated Balance Sheet. Contract assets are transferred to receivables when the right to consideration becomes unconditional. Accounts receivable are not considered contract assets under the revenue standard as contract assets are conditioned upon the company's future satisfaction of a performance obligation. Accounts receivable, in contracts, are unconditional rights to consideration.

Contract liabilities relate to advance consideration received from customers for which revenue has not been recognized. Current contract liabilities are recorded in accrued expenses in the Condensed Consolidated Balance Sheet. Non-current contract liabilities are recorded in other non-current liabilities in the Condensed Consolidated Balance Sheet. Contract liabilities are reduced when the associated revenue from the contract is recognized.

The following table provides information about contract assets and contract liabilities from contracts with customers (in thousands):
 Sep 28, 2024Dec 30, 2023
Contract assets$60,353 $47,072 
Contract liabilities$112,629 $118,681 
Non-current contract liabilities$14,485 $15,721 

During the nine months period ended September 28, 2024, the company reclassified $32.4 million to receivables, which was included in the contract asset balance at the beginning of the period. During the nine months period ended September 28, 2024, the company recognized revenue of $71.5 million which was included in the contract liability balance at the beginning of the period. Additions to contract liabilities representing amounts billed to clients in excess of revenue recognized to date were $95.8 million during the nine months period ended September 28, 2024.

Remaining Performance Obligations

Substantially all of the company's outstanding performance obligations will be satisfied within 12 to 36 months. There were no contract asset impairments during the nine months period ended September 28, 2024.
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6)    Other Comprehensive Income
Changes in accumulated other comprehensive income(1) were as follows (in thousands):
 Currency Translation AdjustmentPension Benefit CostsUnrealized Gain/(Loss) Interest Rate SwapTotal
Balance as of December 30, 2023$(145,490)$(109,713)$32,005 $(223,198)
Other comprehensive income before reclassification31,352 (5,671)9,135 34,816 
Amounts reclassified from accumulated other comprehensive income 1,535 (21,309)(19,774)
Net current-period other comprehensive income$31,352 $(4,136)$(12,174)$15,042 
Balance as of September 28, 2024$(114,138)$(113,849)$19,831 $(208,156)
Balance as of December 31, 2022$(205,345)$(121,701)$48,574 $(278,472)
Other comprehensive income before reclassification(4,751)(2,131)21,872 14,990 
Amounts reclassified from accumulated other comprehensive income 1,587 (23,963)(22,376)
Net current-period other comprehensive income$(4,751)$(544)$(2,091)$(7,386)
Balance as of September 30, 2023$(210,096)$(122,245)$46,483 $(285,858)
(1) As of September 28, 2024, pension and unrealized gain on interest rate swap amounts, net of tax, are $4.8 million and $6.2 million, respectively. During the nine months ended September 28, 2024, the adjustments to pension and unrealized gain on interest rate swap amounts, net of tax, are $0.8 million and $(5.0) million, respectively. As of September 30, 2023, pension and unrealized gain on interest rate swap amounts, net of tax, were $(1.5) million and $16.1 million, respectively. During the nine months ended September 30, 2023, the adjustments to pension and unrealized gain on interest rate swap amounts, net of tax, were $0.5 million and $(0.7) million, respectively.
Components of other comprehensive income were as follows (in thousands):
 Three Months EndedNine Months Ended
 Sep 28, 2024Sep 30, 2023Sep 28, 2024Sep 30, 2023
Net earnings$114,166 $108,650 $316,129 $324,589 
Currency translation adjustment67,366 (36,602)31,352 (4,751)
Pension liability adjustment, net of tax(5,711)4,436 (4,136)(544)
Unrealized (loss) gain on interest rate swaps, net of tax(13,173)20 (12,174)(2,091)
Comprehensive income$162,648 $76,504 $331,171 $317,203 
7)    Inventories
Inventories are composed of material, labor and overhead and are stated at the lower of cost or net realizable value. Costs for inventory have been determined using the first-in, first-out ("FIFO") method. The company estimates reserves for inventory obsolescence and shrinkage based on its judgment of future realization. Inventories at September 28, 2024 and December 30, 2023 are as follows (in thousands): 
 Sep 28, 2024Dec 30, 2023
Raw materials and parts$483,105 $495,488 
Work-in-process78,809 80,102 
Finished goods343,951 360,277 
 $905,865 $935,867 
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8)    Goodwill
Changes in the carrying amount of goodwill for the nine months ended September 28, 2024 are as follows (in thousands):
Commercial
Foodservice
Food
Processing
Residential KitchenTotal
Balance as of December 30, 2023$1,329,056 $375,217 $782,037 $2,486,310 
Goodwill acquired during the year 831  831 
Measurement period adjustments to
goodwill acquired in prior year
271 57 224 552 
Exchange effect3,149 1,930 14,038 19,117 
Balance as of September 28, 2024$1,332,476 $378,035 $796,299 $2,506,810 

The annual impairment assessment for goodwill and indefinite-lived intangible assets is performed as of the first day of the fourth quarter. The company does not believe there have been any interim indicators of impairment requiring analysis other than at the annual assessment date. This is supported by the review of order rates, backlog levels and financial performance across business segments.

9)    Intangibles

Intangible assets consist of the following (in thousands):
 
 September 28, 2024December 30, 2023
Estimated
Weighted Avg
Remaining
Life
Gross
Carrying
Amount
Accumulated
Amortization
Estimated
Weighted Avg
Remaining
Life
Gross
Carrying
Amount
Accumulated
Amortization
Amortized intangible assets:      
Customer relationships6.5$848,411 $(574,957)7.0$845,326 $(529,533)
Developed technology7.698,857 (50,329)8.398,593 (44,546)
  $947,268 $(625,286) $943,919 $(574,079)
Indefinite-lived assets:      
Trademarks and tradenames $1,328,980   $1,323,236  

The aggregate intangible amortization expense was $15.0 million and $18.9 million for the three months period ended September 28, 2024 and September 30, 2023, respectively. The aggregate intangible amortization expense was $48.7 million and $56.6 million for the nine months period ended September 28, 2024 and September 30, 2023, respectively. The estimated future amortization expense of intangible assets is as follows (in thousands):
 
Twelve Month Period coinciding with the end of the company's Fiscal Third Quarter
Amortization Expense
 
2025$58,454 
202656,354 
202747,073 
202841,453 
202935,332 
Thereafter83,316 
$321,982 

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10)    Accrued Expenses
Accrued expenses consist of the following (in thousands):
 Sep 28, 2024Dec 30, 2023
Contract liabilities$112,629 $118,681 
Accrued payroll and related expenses111,019 121,514 
Accrued warranty98,070 89,039 
Accrued customer rebates52,783 59,267 
Accrued short-term leases25,188 26,417 
Accrued contingent consideration20,611 17,791 
Accrued sales and other tax19,053 24,568 
Accrued agent commission16,031 16,956 
Accrued professional fees13,460 18,461 
Accrued product liability and workers compensation11,161 11,169 
Other accrued expenses75,950 75,329 
 $555,955 $579,192 

11)    Warranty Costs
In the normal course of business, the company issues product warranties for specific product lines and provides for the estimated future warranty cost in the period in which the sale is recorded. The estimate of warranty cost is based on contract terms and historical warranty loss experience that is periodically adjusted for recent actual experience. Because warranty estimates are forecasts that are based on the best available information, actual claims costs may differ from amounts provided. Adjustments to initial obligations for warranties are made as changes in the obligations become reasonably estimable.
A rollforward of the warranty reserve is as follows (in thousands):
 Nine Months Ended
 Sep 28, 2024
Balance as of December 30, 2023$89,039 
Warranty expense75,827 
Warranty claims(66,796)
Balance as of September 28, 2024$98,070 

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12)    Financing Arrangements
 Sep 28, 2024Dec 30, 2023
 (in thousands)
Term loan facility$934,447 $945,913 
Delayed draw term loan facility717,188 726,563 
Convertible senior notes744,175 741,501 
Foreign loans8,979 10,531 
Other debt arrangement521 687 
Total debt2,405,310 2,425,195 
Less:  Current maturities of long-term debt44,058 44,822 
Long-term debt$2,361,252 $2,380,373 
Credit Facility
As of September 28, 2024, the company had $1.7 billion of borrowings outstanding under its credit facility (the "Credit Facility"), including $937.5 million outstanding under the term loan ($934.4 million, net of unamortized issuance fees) and $717.2 million outstanding under the delayed draw term loan. The company also had $5.1 million in outstanding letters of credit as of September 28, 2024, which reduces the borrowing availability under the Credit Facility. Remaining borrowing capacity under this facility was $2.7 billion at September 28, 2024.
On August 11, 2022, the company borrowed $750.0 million against the delayed draw term facility as provided under the Credit Agreement. The funds were used to reduce outstanding borrowings under the revolver. The delayed draw term loan amortizes in quarterly installments due on the last day of each fiscal quarter, and commenced on December 31, 2022, in an amount equal to 0.625% of the principal drawn, with the balance, plus any accrued interest payable by October 21, 2026.
At September 28, 2024, borrowings under the Credit Facility accrued interest at a rate of 1.375% above the daily simple or term Secured Overnight Financing Rate (“SOFR”) per annum or 0.375% above the highest of the prime rate, the federal funds rate plus 0.50% and one month Term SOFR plus 1.00%. The interest rates on borrowings under the Credit Facility may be adjusted quarterly based on the company’s Funded Debt less Unrestricted Cash to Pro Forma EBITDA (the “Leverage Ratio”) on a rolling four-quarter basis. Additionally, a commitment fee based upon the Leverage Ratio is charged on the unused portion of the commitments under the Credit Facility. As of September 28, 2024, borrowings under the Credit Facility accrued interest at a minimum of 1.375% above SOFR and the variable unused commitment fee will be at a minimum of 0.20%. Borrowings under the Credit Facility accrue interest at a minimum of 1.375% above the daily simple SOFR or term SOFR for the applicable interest period (each of which includes a spread adjustment of 0.10%). The average interest rate per annum, inclusive of hedging instruments, on the debt under the Credit Facility was equal to 5.04% at the end of the period and the variable commitment fee was equal to 0.20% per annum as of September 28, 2024.
The term loan and delayed draw term loan facilities had an average interest rate per annum, inclusive of hedging instruments, of 5.04% as of September 28, 2024.
In addition, the company has international credit facilities to fund working capital needs outside the United States. At September 28, 2024, these foreign credit facilities amounted to $9.0 million in U.S. Dollars with a weighted average per annum interest rate of approximately 2.46%.

The company’s debt is reflected on the balance sheet at cost. The fair values of the Credit Facility, term debt and foreign and other debt is based on the amount of future cash flows associated with each instrument discounted using the company's incremental borrowing rate. The company believes its interest rate margins, based on the company’s Leverage Ratio, on its existing debt are consistent with current market conditions and therefore the carrying value of debt reflects the fair value. The carrying value and estimated aggregate fair value, a level 2 measurement, based primarily on market prices, of debt excluding the Convertible Notes is as follows (in thousands):
 Sep 28, 2024Dec 30, 2023
 Carrying ValueFair ValueCarrying ValueFair Value
Total debt excluding convertible senior notes$1,661,135 $1,664,187 $1,683,694 $1,687,781 
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The company uses floating-to-fixed interest rate swap agreements to hedge variable interest rate risk associated with the Credit Facility. At September 28, 2024, the company had outstanding floating-to-fixed interest rate swaps totaling $270.0 million notional amount carrying an average interest rate of 2.51% maturing in less than 12 months and $470.0 million notional amount carrying an average interest rate of 1.22% that mature in more than 12 months but less than 41 months.

At September 28, 2024, the company was in compliance with all covenants pursuant to its borrowing agreements.

Convertible Notes
The following table summarizes the outstanding principal amount and carrying value of the Convertible Notes:
 
Sep 28, 2024
Dec 30, 2023
 (in thousands)
Principal amounts:
Principal$747,499 $747,499 
Unamortized issuance costs(3,324)(5,998)
Net carrying amount$744,175 $741,501 
The following table summarizes total interest expense recognized related to the Convertible Notes:
 Three Months EndedNine Months Ended
 
Sep 28, 2024
Sep 30, 2023
Sep 28, 2024
Sep 30, 2023
Contractual interest expense$1,849 $1,847 $5,565 $5,585 
Interest cost related to amortization of issuance costs889 889 2,675 2,685 
Total interest expense$2,738 $2,736 $8,240 $8,270 
The estimated fair value of the Convertible Notes was $874.6 million as of September 28, 2024 and was determined through consideration of quoted market prices. The fair value is classified as Level 2, as defined in Note 1(d), Fair Value Measurements, in these Notes to the Condensed Consolidated Financial Statement. The if-converted value of the Convertible Notes exceeded their respective principal value by $76.0 million as of September 28, 2024.

Capped Call Transactions
In connection with the pricing of the Convertible Notes, the company entered into privately negotiated Capped Call Transactions (the "2020 Capped Call Transactions") and the company used the net proceeds of the offering of the Convertible Notes to pay the aggregate amount of $104.7 million for them. The company entered into two tranches of privately negotiated Capped Call Transactions in December 2021 (the "2021 Capped Call Transactions") in the aggregate amount of $54.6 million. On March 15, 2022, the company entered into an additional tranche of privately negotiated Capped Call Transactions (the "2022 Capped Call Transactions") in the amount of $9.7 million.
The 2020, 2021, and 2022 Capped Call Transactions (collectively, the "Capped Call Transactions") are expected generally to reduce the potential dilution and/or offset the cash payments the company is required to make in excess of the principal amount of the Convertible Notes upon conversion of the Convertible Notes in the event that the market price per share of the company's common stock is greater than the strike price of the Capped Call Transactions (which initially corresponds to the initial conversion price of the Convertible Notes and is subject to certain adjustments under the terms of the Capped Call Transactions), with such reduction and/or offset subject to a cap based on the cap price of the Capped Call Transactions. The 2020 Capped Call Transactions have an initial cap price of $207.93 per share of the company's common stock. The 2021 Capped Call Transactions have initial cap prices of $216.50 and $225.00 per share of the company's common stock. The 2022 Capped Call Transactions have an initial cap price of $229.00 per share. The Capped Call Transactions cover, initially, the number of shares of the company's common stock underlying the Convertible Notes, subject to anti-dilution adjustments substantially similar to those applicable to the Convertible Notes.

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The Capped Call Transactions are separate transactions entered into by the company with the capped call counterparties, and are not part of the terms of the Convertible Notes and will not affect any holder's right under the Convertible Notes. Holders of the Convertible Notes will not have any rights with respect to the Capped Call Transactions. The Capped Call Transactions do not meet the criteria for separate accounting as a derivative as they are indexed to the company's stock. The premiums paid of the Capped Call Transactions have been included as a net reduction to additional paid-in capital with stockholders' equity.
13)    Financial Instruments
Foreign Exchange: The company uses foreign currency forward, foreign exchange swaps and option purchase and sales contracts to hedge its exposure to changes in foreign currency exchange rates. The company’s primary hedging activities are to mitigate its exposure to changes in exchange rates on intercompany and third-party trade receivables and payables. The company does not currently enter into derivative financial instruments for speculative purposes. In managing its foreign currency exposures, the company identifies and aggregates naturally occurring offsetting positions and then hedges residual balance sheet exposures. The notional amount of foreign currency contracts outstanding was $265.7 million and $253.1 million as of September 28, 2024 and December 30, 2023, respectively. The fair value of the forward and option contracts was a gain of $0.1 million at the end of the third quarter of 2024.
Interest Rate: The company has entered into interest rate swaps to fix the interest rate applicable to certain of its variable-rate debt. The agreements swapped one-month LIBOR for fixed rates. In February 2022, the company entered into an additional floating-to-fixed interest rate swap agreement that uses a daily SOFR in lieu of LIBOR. In April 2023, all outstanding LIBOR swap agreements were amended to one month term SOFR. The company has designated these swaps as cash flow hedges and all changes in fair value of the swaps are recognized in accumulated other comprehensive income. As of September 28, 2024, the fair value of these instruments was an asset of $25.6 million. The change in fair value of these swap agreements in the first nine months of 2024 was a loss of $12.2 million, net of taxes.
The following table summarizes the company’s fair value of interest rate swaps (in thousands):
Condensed Consolidated
Balance Sheet Presentation
Sep 28, 2024Dec 30, 2023
Fair valuePrepaid expense and other$2,808 $2,897 
Fair valueOther assets$22,821 $39,882 
The impact on earnings from interest rate swaps was as follows (in thousands):
  Three Months EndedNine Months Ended
 Presentation of Gain/(loss)Sep 28, 2024Sep 30, 2023Sep 28, 2024Sep 30, 2023
Gain/(loss) recognized in accumulated other comprehensive incomeOther comprehensive income$(10,409)$8,706 $4,159 $21,141 
Gain/(loss) reclassified from accumulated other comprehensive income (effective portion)Interest expense$6,884 $8,679 $21,309 $23,963 
Interest rate swaps are subject to default risk to the extent the counterparties are unable to satisfy their settlement obligations under the interest rate swap agreements. As a result, the company has counterparty credit exposure to large global financial institutions, which the company monitors on a regular basis.
14)    Segment Information
The company operates in three reportable operating segments defined by management reporting structure and operating activities.
 



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The Commercial Foodservice Equipment Group has a broad portfolio of foodservice equipment, which enables it to serve virtually any cooking, warming, holding, refrigeration, freezing and beverage application within a commercial kitchen or foodservice operation. This equipment is used across all types of foodservice operations, including quick-service restaurants, full-service restaurants, ghost kitchens, convenience stores, supermarkets, retail outlets, hotels and other institutions. The products offered by this group include conveyor ovens, combi-ovens, convection ovens, baking ovens, proofing ovens, deck ovens, speed cooking ovens, hydrovection ovens, ranges, fryers, rethermalizers, steam cooking equipment, food warming equipment, catering equipment, heated cabinets, charbroilers, ventless cooking systems, kitchen ventilation, induction cooking equipment, countertop cooking equipment, toasters, griddles, charcoal grills, professional mixers, stainless steel fabrication, custom millwork, professional refrigerators, blast chillers, coldrooms, ice machines, freezers, soft serve ice cream equipment, coffee and beverage dispensing equipment, home and professional craft brewing equipment, fry dispensers, bottle filling and canning equipment, IoT solutions and controls development and manufacturing.
 
The Food Processing Equipment Group offers a broad portfolio of processing solutions for customers producing protein products, such as bacon, salami, hot dogs, dinner sausages, poultry and lunchmeats and baked goods such as muffins, cookies, crackers, pies, bread and buns. Through its broad line of products, the company is able to deliver a wide array of food preparation, thermal processing, slicing/packaging, facility automation and equipment sanitation solutions to service a variety of food processing requirements demanded by its customers. The company can offer highly integrated full processing line solutions that provide a food processing operation a uniquely integrated solution providing for the highest level of food quality, product consistency, and reduced operating costs resulting from increased product yields, increased capacity and greater throughput and reduced labor costs through automation. The products offered by this group include a wide array of cooking and baking solutions, including batch ovens, baking ovens, proofing ovens, conveyor belt ovens, continuous processing ovens, frying systems and automated thermal processing systems. The company also provides a comprehensive portfolio of complementary food preparation equipment such as tumblers, massagers, grinders, slicers, reduction and emulsion systems, mixers, blenders, battering equipment, breading equipment, seeding equipment, water cutting systems, food presses, food suspension equipment, filling and depositing solutions, and forming equipment, as well as a variety of automated loading and unloading systems, automated washing systems, auto-guided vehicles, food safety, food handling, freezing, defrosting and packaging equipment. This portfolio of equipment can be integrated to provide customers a highly efficient and customized solution.

The Residential Kitchen Equipment Group has a broad portfolio of innovative and professional-style residential kitchen equipment. The products offered by this group include ranges, cookers, stoves, cooktops, microwaves, ovens, refrigerators, dishwashers, undercounter refrigeration, wine cellars, ice machines, beer dispensers, ventilation equipment, mixers, rotisseries and outdoor cooking equipment.
The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The chief operating decision maker evaluates individual segment performance based on operating income.
Net Sales Summary
(dollars in thousands)
 Three Months EndedNine Months Ended
 Sep 28, 2024Sep 30, 2023Sep 28, 2024Sep 30, 2023
 SalesPercentSalesPercentSalesPercentSalesPercent
Business Segments:    
Commercial Foodservice$600,068 63.6 %$634,009 64.7 %$1,809,790 63.3 %$1,893,607 62.5 %
Food Processing169,523 18.0 166,667 17.0 511,610 17.8 528,918 17.5 
Residential Kitchen173,218 18.4 179,975 18.3 539,881 18.9 605,504 20.0 
    Total$942,809 100.0 %$980,651 100.0 %$2,861,281 100.0 %$3,028,029 100.0 %
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The following table summarizes the results of operations for the company's business segments(1) (dollars in thousands):
 Commercial
 Foodservice
Food ProcessingResidential Kitchen
Corporate
and Other(2)
Total
Three Months Ended September 28, 2024    
Net sales$600,068 $169,523 $173,218 $ $942,809 
Income (loss) from operations (3)
146,088 37,497 13,170 (23,316)173,439 
Depreciation expense (4)
7,115 2,504 3,906 450 13,975 
Amortization expense (5)
11,479 1,736