October 26, 2020 - 10-Q: Quarterly report pursuant to Section 13 or 15(d)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 26, 2020

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ______

Commission file number 1-13293

The Hillman Companies, Inc.

(Exact name of registrant as specified in its charter)

Delaware

23-2874736

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

10590 Hamilton Avenue

45231

Cincinnati

Ohio

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (513) 851-4900

Securities registered pursuant to Section 12(g) of the Act: None

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 ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b‑2 of the Exchange Act. (Check one):

Large accelerated filer

☐

Accelerated filer

☐

Non-accelerated filer

☒ (Do not check if a smaller reporting company)

Smaller reporting company

☐

Emerging 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. ☐

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 Class	Trading symbols	Name of Each Exchange on Which Registered
11.6% Junior Subordinated Debentures		None
Preferred Securities Guaranty		None

On October 26, 2020, 5,000 shares of the Registrant’s common stock were issued and outstanding and 4,217,724 Trust Preferred Securities were issued and outstanding by the Hillman Group Capital Trust. The Trust Preferred Securities trade on the NYSE Amex under symbol HLM.Pr.

Table of Contents

THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

INDEX


PART I. FINANCIAL INFORMATION			PAGE

Item 1.	Condensed Consolidated Financial Statements (Unaudited)
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Comprehensive Income (Loss)	4
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	31
Item 4.	Controls and Procedures	31
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	32
Item 1A.	Risk Factors	32
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	32
Item 3.	Defaults upon Senior Securities	32
Item 4.	Mine Safety Disclosures	32
Item 5.	Other Information	32
Item 6.	Exhibits	33
SIGNATURES			34

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THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(dollars in thousands, except per share amounts)


	September 26, 2020		December 28, 2019
ASSETS
Current assets:
Cash and cash equivalents	$	32,936	$	19,973
Accounts receivable, net of allowances of $1,617 ($1,891 - 2019)	148,354		88,374
Inventories, net	338,191		323,496
Other current assets	23,946		8,828
Total current assets	543,427		440,671
Property and equipment, net of accumulated depreciation of $225,253 ($179,791 - 2019)	182,937		205,160
Goodwill	817,781		819,077
Other intangibles, net of accumulated amortization of $275,972 ($232,060 - 2019)	839,322		882,430
Operating lease right of use assets	78,546		81,613
Deferred tax asset	1,514		702
Other assets	11,154		11,557
Total assets	$	2,474,681	$	2,441,210
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	166,771	$	125,042
Current portion of debt and capital leases	11,423		11,358
Current portion of operating lease liabilities	12,235		11,459
Accrued expenses:
Salaries and wages	27,011		12,937
Pricing allowances	8,664		6,553
Income and other taxes	6,824		5,248
Interest	17,583		14,726
Other accrued expenses	29,704		21,545
Total current liabilities	280,215		208,868
Long term debt	1,562,428		1,584,289
Deferred tax liabilities	187,938		196,437
Operating lease liabilities	70,474		73,227
Other non-current liabilities	32,524		33,287
Total liabilities	$	2,133,579	$	2,096,108
Commitments and contingencies (Note 6)
Stockholder's Equity:
Preferred stock, $0.01 par, 5,000 shares authorized, none issued or outstanding at September 26, 2020 and December 28, 2019	—		—
Common stock, $0.01 par, 5,000 shares authorized, issued and outstanding at September 26, 2020 and December 28, 2019	—		—
Additional paid-in capital	557,177		553,359
Accumulated deficit	(179,535)		(176,217)
Accumulated other comprehensive loss	(36,540)		(32,040)
Total stockholder's equity	341,102		345,102
Total liabilities and stockholder's equity	$	2,474,681	$	2,441,210

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited)

(dollars in thousands)


	Thirteen Weeks Ended September 26, 2020		Thirteen Weeks Ended September 28, 2019		Thirty-nine Weeks Ended September 26, 2020		Thirty-nine Weeks Ended September 28, 2019
Net sales	$	398,680	$	317,277	$	1,041,226	$	929,564
Cost of sales (exclusive of depreciation and amortization shown separately below)	227,481		176,586		590,294		523,816
Selling, general and administrative expenses	107,333		99,329		292,056		288,047
Depreciation	15,926		16,269		50,673		48,740
Amortization	14,883		14,665		44,596		44,114
Management fees to related party	130		140		451		396
Other (income) expense	(2,175)		335		(2,120)		5,687
Income from operations	35,102		9,953		65,276		18,764
Interest expense, net	20,688		24,882		67,746		77,509
Interest expense on junior subordinated debentures	3,219		3,152		9,555		9,456
(Gain) loss on mark-to-market adjustment of interest rate swap	(773)		315		1,169		3,217

Investment income on trust common securities	(94)		(95)		(283)		(284)
Income (loss) before income taxes	12,062		(18,301)		(12,911)		(71,134)
Income tax (benefit) expense	1,400		(3,775)		(9,593)		(1,844)
Net income (loss)	$	10,662	$	(14,526)	$	(3,318)	$	(69,290)
Net income (loss) from above	$	10,662	$	(14,526)	$	(3,318)	$	(69,290)
Other comprehensive income (loss):
Foreign currency translation adjustments	3,070		(1,705)		(4,500)		3,621
Total other comprehensive income (loss)	3,070		(1,705)		(4,500)		3,621
Comprehensive income (loss)	$	13,732	$	(16,231)	$	(7,818)	$	(65,669)

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(dollars in thousands)


	Thirty-nine Weeks Ended September 26, 2020		Thirty-nine Weeks Ended September 28, 2019
Cash flows from operating activities:
Net loss	$	(3,318)	$	(69,290)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	95,269		92,854
Deferred income taxes	(9,182)		(2,522)
Deferred financing and original issue discount amortization	2,805		2,779
Stock-based compensation expense	3,818		1,906

Asset impairment	210		6,896
Gain on disposal of property and equipment	(23)		(123)
Change in fair value of contingent consideration	(1,300)		—
Other non-cash interest and change in value of interest rate swap	1,245		3,217
Changes in operating items:
Accounts receivable	(60,470)		(4,707)
Inventories	(16,793)		(13,232)
Other assets	(15,276)		2,212
Accounts payable	42,201		4,508
Other accrued liabilities	28,402		10,369


Net cash provided by operating activities	67,588		34,867
Cash flows from investing activities:
Acquisition of business, net of cash received	(800)		(6,135)
Capital expenditures	(29,182)		(41,097)
Proceeds from sale of property and equipment	—		9,929

Net cash used in investing activities	(29,982)		(37,303)
Cash flows from financing activities:
Repayments of senior term loans	(7,956)		(7,956)


Borrowings on revolving credit loans	78,000		27,500
Repayments of revolving credit loans	(94,000)		(32,700)
Principal payments under finance and capitalized lease obligations	(624)		(484)

Proceeds from sale of Holdco stock	—		750

Net cash used by financing activities	(24,580)		(12,890)
Effect of exchange rate changes on cash	(63)		34
Net increase (decrease) in cash and cash equivalents	12,963		(15,292)
Cash and cash equivalents at beginning of period	19,973		28,234
Cash and cash equivalents at end of period	$	32,936	$	12,942
Supplemental disclosure of cash flow information:
Interest paid on junior subordinated debentures, net	$	9,272	$	9,172
Interest paid	59,147		77,340
Income taxes paid	475		700

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (Unaudited)

(dollars in thousands)


	Common Stock		Additional Paid-in-capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders Equity
Thirty-nine weeks ended September 26, 2020
Balance at December 28, 2019	$	—	$	553,359	$	(176,217)	$	(32,040)	$	345,102
Net loss	—		—		(9,751)		—		(9,751)
Stock-based compensation	—		1,145		—		—		1,145
Change in cumulative foreign currency translation adjustment	—		—		—		(11,213)		(11,213)
Balance at March 28, 2020	—		554,504		(185,968)		(43,253)		325,283
Net loss	—		—		(4,229)		—		(4,229)
Stock-based compensation	—		1,525		—		—		1,525
Change in cumulative foreign currency translation adjustment	—		—		—		3,643		3,643
Balance at June 27, 2020	—		556,029		(190,197)		(39,610)		326,222
Net income	—		—		10,662		—		10,662
Stock-based compensation	—		1,148		—		—		1,148
Change in cumulative foreign currency translation adjustment	—		—		—		3,070		3,070
Balance at September 26, 2020	$	—	$	557,177	$	(179,535)	$	(36,540)	$	341,102

Thirty-nine weeks ended September 28, 2019
Balance at December 29, 2018	$	—	$	549,528	$	(72,831)	$	(37,590)	$	439,107
Net loss	—		—		(35,268)		—		(35,268)
Stock-based compensation	—		361		—		—		361
Change in cumulative foreign currency translation adjustment	—		—		—		2,779		2,779


Balance at March 30, 2019	—		549,889		(108,099)		(34,811)		406,979
Net loss	—		—		(19,496)		—		(19,496)
Stock-based compensation	—		301		—		—		301

Change in cumulative foreign currency translation adjustment	—		—		—		2,547		2,547

Balance at June 29, 2019	—		550,190		(127,595)		(32,264)		390,331
Net loss	—		—		(14,526)		—		(14,526)
Stock-based compensation	—		1,244		—		—		1,244

Dividend to Holdco	—		750		—		—		750
Change in cumulative foreign currency translation adjustment	—		—		—		(1,705)		(1,705)

Balance at September 28, 2019	$	—	$	552,184	$	(142,121)	$	(33,969)	$	376,094

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands)

1. Basis of Presentation:

The accompanying unaudited financial statements include the condensed consolidated accounts of The Hillman Companies, Inc. and its wholly-owned subsidiaries (collectively “Hillman” or the “Company”) for the thirty-nine weeks ended September 26, 2020. Unless the context requires otherwise, references to "Hillman," "we," "us," "our," or "our Company" refer to The Hillman Companies, Inc. and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated. The Hillman Companies, Inc. is a wholly-owned subsidiary of HMAN Intermediate II Holdings Corp., and a wholly-owned subsidiary of HMAN Group Holdings Inc. (“Holdco”).

The accompanying unaudited condensed consolidated financial statements present information in accordance with accounting principles generally accepted in the United States for interim financial information and the instructions to Form 10-Q and applicable rules of Regulation S-X. Accordingly, they do not include all information or footnotes required by U.S. generally accepted accounting principles for complete financial statements. Operating results for the thirty-nine weeks ended September 26, 2020 do not necessarily indicate the results that may be expected for the full year. For further information, refer to the consolidated financial statements and notes thereto included in the Company’s annual report filed on Form 10-K for the year ended December 28, 2019.

2. Summary of Significant Accounting Policies:

The significant accounting policies should be read in conjunction with the significant accounting policies included in the Form 10-K for the year ended December 28, 2019.

Use of Estimates in the Preparation of Financial Statements:

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses for the reporting periods. Actual results may differ from these estimates.

The extent to which COVID-19 impacts the Company’s business and financial results will depend on numerous evolving factors including, but not limited to: the magnitude and duration of COVID-19, the extent to which it will impact worldwide macroeconomic conditions including interest rates, employment rates and health insurance coverage, the speed of the anticipated recovery, and governmental and business reactions to the pandemic. The Company assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to the Company and the unknown future impacts COVID-19 as of September 26, 2020 and through the date of this report. The accounting matters assessed included, but were not limited to the carrying value of the goodwill and other long-lived assets. While there was not a material impact to the Company’s consolidated financial statements as of and for the quarter ended September 26, 2020, the Company’s future assessment of the magnitude and duration of COVID-19, as well as other factors, could result in material impacts to the Company’s consolidated financial statements in future reporting periods.

Reclassifications:

The Company reclassified the mark-to-market adjustment of our interest rate swap from other income/expense to its own line on the income statement below income from operations. The reclassifications had no impact on the prior periods’ statement of financial position, net loss, cash flows, or stockholder’s equity.

Revenue Recognition:

Revenue is recognized when control of goods or services is transferred to our customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Sales and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue.

The Company offers a variety of sales incentives to its customers primarily in the form of discounts and rebates. Discounts are recognized in the consolidated financial statements at the date of the related sale. Rebates are based on the revenue to date and the contractual rebate percentage to be paid. A portion of the cost of the rebate is allocated to each underlying sales transaction. Discounts and rebates are included in the determination of net sales.

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THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands)

The Company also establishes reserves for customer returns and allowances. The reserve is established based on historical rates of returns and allowances. The reserve is adjusted quarterly based on actual experience. Returns and allowances are included in the determination of net sales.

The following table displays our disaggregated revenue by product category:


	Thirteen weeks ended September 26, 2020
	Fastening, Hardware, and Personal Protective Solutions		Consumer Connected Solutions		Canada		Total Revenue
Fastening and Hardware	$	202,876	$	—	$	38,383	$	241,259
Personal Protective	97,431		—		12		97,443
Keys and Key Accessories	—		44,974		790		45,764
Engraving	—		14,205		2		14,207
Resharp	—		7		—		7
Consolidated	$	300,307	$	59,186	$	39,187	$	398,680


	Thirteen weeks ended September 28, 2019
	Fastening, Hardware, and Personal Protective Solutions		Consumer Connected Solutions		Canada		Total Revenue
Fastening and Hardware	$	163,860	$	—	$	31,362	$	195,222
Personal Protective	59,087		—		—		59,087
Keys and Key Accessories	—		49,230		1,170		50,400
Engraving	—		12,556		1		12,557
Resharp	—		11		—		11
Consolidated	$	222,947	$	61,797	$	32,533	$	317,277


	Thirty-nine weeks ended September 26, 2020
	Fastening, Hardware, and Personal Protective Solutions		Consumer Connected Solutions		Canada		Total Revenue
Fastening and Hardware	$	543,832	$	—	$	98,430	$	642,262
Personal Protective	239,151		—		78		239,229
Keys and Key Accessories	—		119,001		2,039		121,040
Engraving	—		38,666		5		38,671
Resharp	—		24		—		24
Consolidated	$	782,983	$	157,691	$	100,552	$	1,041,226


	Thirty-nine weeks ended September 28, 2019
	Fastening, Hardware, and Personal Protective Solutions		Consumer Connected Solutions		Canada		Total Revenue
Fastening and Hardware	$	465,524	$	—	$	96,248	$	561,772
Personal Protective	185,430		—		—		185,430
Keys and Key Accessories	—		139,718		2,983		142,701
Engraving	—		39,646		4		39,650
Resharp	—		11		—		11
Consolidated	$	650,954	$	179,375	$	99,235	$	929,564

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THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands)

The following table disaggregates our revenue by geographic location:


	Thirteen weeks ended September 26, 2020
	Fastening, Hardware, and Personal Protective Solutions		Consumer Connected Solutions		Canada		Total Revenue
United States	$	295,689	$	58,566	$	—	$	354,255
Canada	2,292		620		39,187		42,099
Mexico	2,326		—		—		2,326
Consolidated	$	300,307	$	59,186	$	39,187	$	398,680


	Thirteen weeks ended September 28, 2019
	Fastening, Hardware, and Personal Protective Solutions		Consumer Connected Solutions		Canada		Total Revenue
United States	$	218,585	$	61,241	$	—	$	279,826
Canada	1,622		556		32,533		34,711
Mexico	2,740		—		—		2,740
Consolidated	$	222,947	$	61,797	$	32,533	$	317,277


	Thirty-nine weeks ended September 26, 2020
	Fastening, Hardware, and Personal Protective Solutions		Consumer Connected Solutions		Canada		Total Revenue
United States	$	771,064	$	156,249	$	—	$	927,313
Canada	4,833		1,442		100,552		106,827
Mexico	7,086		—		—		7,086
Consolidated	$	782,983	$	157,691	$	100,552	$	1,041,226


	Thirty-nine weeks ended September 28, 2019
	Fastening, Hardware, and Personal Protective Solutions		Consumer Connected Solutions		Canada		Total Revenue
United States	$	638,322	$	178,028	$	—	$	816,350
Canada	4,045		1,347		99,235		104,627
Mexico	8,587		—		—		8,587
Consolidated	$	650,954	$	179,375	$	99,235	$	929,564

Our revenue by geography is allocated based on the location of our sales operations. Our Fastening, Hardware, and Personal Protective Solutions segment contains sales of Big Time Products ("Big Time") personal protective equipment into Canada. Our Consumer Connected Solutions segment contains sales of MinuteKey into Canada.

Fastening, Hardware, and Personal Protective Solutions revenues consist primarily of the delivery of fasteners, anchors, specialty fastening products, and personal protective equipment such as gloves and eye-wear as well as in-store merchandising services for the related product category.

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THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands)

Consumer Connected Solutions revenues consist primarily of sales of keys and identification tags through self service key duplication and engraving kiosks. It also includes our associate-assisted key duplication systems and key accessories.

Canada revenues consist primarily of the delivery to Canadian customers of fasteners and related hardware items, threaded rod, keys, key duplicating systems, accessories, personal protective equipment, and identification items as well as in-store merchandising services for the related product category.

The Company’s performance obligations under its arrangements with customers are providing products, in-store merchandising services, and access to key duplicating and engraving equipment. Generally, the price of the merchandising services and the access to the key duplicating and engraving equipment is included in the price of the related products. Control of products is transferred at the point in time when the customer accepts the goods. The Company’s obligation to provide in-store service and access to key duplicating and engraving equipment is satisfied when control of the related products is transferred. Therefore, the entire amount of consideration related to the sale of products, in-store merchandising services, and access to key duplicating and engraving equipment is recognized upon the customer’s acceptance of the products. The revenues for all performance obligations are recognized upon the customer's acceptance of the products.

The costs to obtain a contract are insignificant, and generally contract terms do not extend beyond one year. Therefore, these costs are expensed as incurred. Freight and shipping costs and the cost of our in-store merchandising services teams are recognized in selling, general, and administrative expense when control over products is transferred to the customer.

3. Recent Accounting Pronouncements:

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses. The ASU sets forth a “current expected credit loss” (CECL) model which requires the Company to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost and applies to some off-balance sheet credit exposures. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company adopted this ASU in the first quarter of fiscal 2020, and it did not have a material impact on the Company's Condensed Consolidated Financial Statements.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting which provide optional guidance for a limited time to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. The amendments apply only to contracts and hedging relationships that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform. These amendments are effective immediately and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. The Company is currently evaluating contracts and the optional expedients provided by the new standard.

4. Acquisitions

On February 19, 2020, the Company acquired the assets of Instafob LLC ("Instafob") for a cash payment of $800 and a total purchase price of $2,618, which includes $1,818 in contingent and non-contingent considerations that remains payable to the seller. The financial results of Instafob reside within the Company's Consumer Connected Solutions segment and have been determined to be immaterial for purposes of additional disclosure.

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THE HILLMAN COMPANIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(dollars in thousands)

5. Goodwill and Other Intangible Assets:

Goodwill amounts by reportable segment are summarized as follows:


	Goodwill at		Acquisitions		Dispositions		Adjustments		Other⁽¹⁾		Goodwill at
	December 28, 2019												September 26, 2020
Fastening, Hardware, and Personal Protection	$	567,847	$	—	$	—	$	—	$	(604)	$	567,243
Consumer Connected Solutions	222,096		—		—		—		—		222,096
Canada	29,134		—		—		—		(692)		28,442
Total	$	819,077	$	—	$	—	$	—	$	(1,296)	$	817,781

(1)The "Other" change to goodwill relates to adjustments resulting from fluctuations in foreign currency exchange rates for the Canada and Mexico reporting units.

Other intangibles, net, as of September 26, 2020 and December 28, 2019 consist of the following:


	Estimated Useful Life (Years)					September 26, 2020		December 28, 2019
Customer relationships	13	-	20	$	939,908	$	941,305
Trademarks - Indefinite	Indefinite					85,262		85,517
Trademarks - Other	7	-	15	26,400		26,700
Technology and patents	7	-	12	63,724		60,968
Intangible assets, gross						1,115,294		1,114,490
Less: Accumulated amortization				275,972		232,060
Other intangibles, net				$

Form: 10-Q

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