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Duckhorn Portfolio, Inc. – ‘10-K’ for 7/31/22 – ‘R22’

On:  Wednesday, 9/28/22, at 4:22pm ET   ·   For:  7/31/22   ·   Accession #:  1835256-22-63   ·   File #:  1-40240

Previous ‘10-K’:  ‘10-K’ on 10/4/21 for 7/31/21   ·   Next:  ‘10-K/A’ on 12/30/22 for 7/31/22   ·   Latest:  ‘10-K/A’ on 10/19/23 for 7/31/23   ·   10 References:   

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  As Of               Filer                 Filing    For·On·As Docs:Size

 9/28/22  Duckhorn Portfolio, Inc.          10-K        7/31/22  102:12M

Annual Report   —   Form 10-K

Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K        Annual Report                                       HTML   2.39M 
 2: EX-10.27    Material Contract                                   HTML   1.29M 
 3: EX-21.1     Subsidiaries List                                   HTML     28K 
 4: EX-23.1     Consent of Expert or Counsel                        HTML     26K 
 5: EX-31.1     Certification -- §302 - SOA'02                      HTML     31K 
 6: EX-31.2     Certification -- §302 - SOA'02                      HTML     31K 
 7: EX-32.1     Certification -- §906 - SOA'02                      HTML     29K 
13: R1          Cover                                               HTML     90K 
14: R2          Audit Information                                   HTML     32K 
15: R3          Consolidated Statements of Financial Position       HTML    168K 
16: R4          Consolidated Statements of Operations               HTML    118K 
17: R5          Consolidated Statements of Changes in Equity        HTML     90K 
18: R6          Consolidated Statements of Cash Flows               HTML    141K 
19: R7          Consolidated Statements of Financial Position       HTML     35K 
                (Parenthetical)                                                  
20: R8          Consolidated Statements of Operations               HTML     29K 
                (Parenthetical)                                                  
21: R9          Description of business                             HTML     35K 
22: R10         Basis of presentation and significant accounting    HTML     95K 
                policies                                                         
23: R11         Revenue                                             HTML     70K 
24: R12         Inventories                                         HTML     37K 
25: R13         Property and equipment                              HTML     45K 
26: R14         Leases                                              HTML     66K 
27: R15         Goodwill and other intangible assets                HTML     69K 
28: R16         Accrued expenses                                    HTML     39K 
29: R17         Debt                                                HTML     60K 
30: R18         Derivative instruments                              HTML     63K 
31: R19         Fair value measurements                             HTML     61K 
32: R20         Income taxes                                        HTML     83K 
33: R21         Employee benefit plans                              HTML     33K 
34: R22         Commitment and contingencies                        HTML     36K 
35: R23         Equity-based compensation                           HTML     85K 
36: R24         Related party transactions                          HTML     30K 
37: R25         Casualty loss (Gain)                                HTML     30K 
38: R26         Earnings per share                                  HTML     45K 
39: R27         Subsequent events                                   HTML     30K 
40: R28         Basis of presentation and significant accounting    HTML    150K 
                policies (Policies)                                              
41: R29         Basis of presentation and significant accounting    HTML     42K 
                policies (Tables)                                                
42: R30         Revenue (Tables)                                    HTML     69K 
43: R31         Inventories (Tables)                                HTML     37K 
44: R32         Property and equipment (Tables)                     HTML     44K 
45: R33         Leases (Tables)                                     HTML     69K 
46: R34         Goodwill and other intangible assets (Tables)       HTML    101K 
47: R35         Accrued expenses (Tables)                           HTML     40K 
48: R36         Debt (Tables)                                       HTML     51K 
49: R37         Derivative instruments (Tables)                     HTML     70K 
50: R38         Fair value measurements (Tables)                    HTML     55K 
51: R39         Income taxes (Tables)                               HTML     85K 
52: R40         Equity-based compensation (Tables)                  HTML     83K 
53: R41         Earnings per share (Tables)                         HTML     44K 
54: R42         Description of business (Details)                   HTML     54K 
55: R43         Basis of presentation and significant accounting    HTML    100K 
                policies - Narrative (Details)                                   
56: R44         Basis of presentation and significant accounting    HTML     42K 
                policies - Schedule of Concentration Risk by                     
                Customer (Details)                                               
57: R45         Revenue - Disaggregation of Revenue (Details)       HTML     56K 
58: R46         Revenue - Schedule of Change in Contract            HTML     35K 
                Liabilities (Details)                                            
59: R47         Revenue - Narrative (Details)                       HTML     28K 
60: R48         Inventories - Schedule of Inventories (Details)     HTML     36K 
61: R49         Inventories - Narrative (Details)                   HTML     36K 
62: R50         Property and equipment - Schedule of Property and   HTML     64K 
                Equipment (Details)                                              
63: R51         Property and equipment - Narrative (Details)        HTML     35K 
64: R52         Leases - Narrative (Details)                        HTML     36K 
65: R53         Leases - Amounts in Consolidated Statements of      HTML     38K 
                Financial Position for Leases (Details)                          
66: R54         Leases - Lease Costs (Details)                      HTML     42K 
67: R55         Leases - Maturity of Operating Lease Liabilities    HTML     46K 
                (Details)                                                        
68: R56         Leases - Supplemental Cash Flow Information         HTML     33K 
                (Details)                                                        
69: R57         Leases - Future Minimum Payments Prior To Adoption  HTML     44K 
                of ASC 842 (Details)                                             
70: R58         Goodwill and other intangible assets - Narrative    HTML     42K 
                (Details)                                                        
71: R59         Goodwill and other intangible assets - Schedule of  HTML     58K 
                Intangible Assets (Details)                                      
72: R60         Goodwill and other intangible assets - Schedule of  HTML     42K 
                Future Amortization Expense (Details)                            
73: R61         Accrued expenses - Schedule of Accrued Liabilities  HTML     40K 
                (Details)                                                        
74: R62         Accrued expenses - Narrative (Details)              HTML     28K 
75: R63         Debt - Schedule of Long Term Debt (Details)         HTML     49K 
76: R64         Debt - Narrative (Details)                          HTML     89K 
77: R65         Debt - Schedule of Long Term Debt Repayment         HTML     50K 
                (Details)                                                        
78: R66         Derivative instruments - Interest Rate Swaps        HTML     31K 
                (Details)                                                        
79: R67         Derivative instruments - Total Notional Amount      HTML     34K 
                (Details)                                                        
80: R68         Derivative instruments - Estimated Fair Value and   HTML     47K 
                Classification of Derivative Instruments on the                  
                Condensed Consolidated Statements of Financial                   
                Position (Details)                                               
81: R69         Derivative instruments - Amounts and                HTML     36K 
                Classification of the Gains and Losses in the                    
                Condensed Consolidated Statements of Operations                  
                (Details)                                                        
82: R70         Fair value measurements - Assets and Liabilities    HTML     63K 
                Measured on a Recurring Basis (Details)                          
83: R71         Income taxes - Provision (Benefit) for Income       HTML     50K 
                Taxes (Details)                                                  
84: R72         Income taxes - Schedule of Deferred Tax Assets and  HTML     64K 
                Liabilities (Details)                                            
85: R73         Income taxes - Narrative (Details)                  HTML     33K 
86: R74         Income taxes - Effective Income Tax Rate            HTML     39K 
                Reconciliation (Details)                                         
87: R75         Income taxes - Schedule of Unrecognized Tax         HTML     31K 
                Benefits (Details)                                               
88: R76         Employee benefit plans (Details)                    HTML     48K 
89: R77         Commitment and contingencies (Details)              HTML     52K 
90: R78         Equity-based compensation - Narrative (Details)     HTML     95K 
91: R79         Equity-based compensation - Activity for Awards     HTML     59K 
                (Details)                                                        
92: R80         Equity-based compensation - Valuation Assumptions   HTML     48K 
                (Details)                                                        
93: R81         Equity-based compensation - Stock Option Activity   HTML     62K 
                (Details)                                                        
94: R82         Related party transactions (Details)                HTML     28K 
95: R83         Casualty loss (Gain) (Details)                      HTML     36K 
96: R84         Earnings per share - Reconciliation of Basic and    HTML     64K 
                Diluted Income Per Share (Details)                               
97: R85         Earnings per share - Narrative (Details)            HTML     33K 
100: XML         IDEA XML File -- Filing Summary                      XML    184K  
98: XML         XBRL Instance -- napa-20220731_htm                   XML   2.32M 
99: EXCEL       IDEA Workbook of Financial Reports                  XLSX    186K 
 9: EX-101.CAL  XBRL Calculations -- napa-20220731_cal               XML    257K 
10: EX-101.DEF  XBRL Definitions -- napa-20220731_def                XML    633K 
11: EX-101.LAB  XBRL Labels -- napa-20220731_lab                     XML   1.95M 
12: EX-101.PRE  XBRL Presentations -- napa-20220731_pre              XML   1.16M 
 8: EX-101.SCH  XBRL Schema -- napa-20220731                         XSD    188K 
101: JSON        XBRL Instance as JSON Data -- MetaLinks              485±   742K  
102: ZIP         XBRL Zipped Folder -- 0001835256-22-000063-xbrl      Zip   1.02M

‘R22’   —   Commitment and contingencies

This is an IDEA Financial Report.  [ Alternative Formats ]

 
 <>  v3.22.2.2
Commitment and contingencies
 12 Months Ended
Commitments and Contingencies Disclosure [Abstract]  
Commitment and contingencies Commitments and contingencies
Long-term purchase contracts
The Company has certain grape purchase contracts with various growers to supply a significant portion of its future grape requirements for wine production. The lengths of the contracts typically vary from one to eight years, and prices per ton are either determined at the outset for the contract duration or are negotiated annually. The Company's grape purchase contracts generally include acceptance provisions based on qualitative and quantitative grape quality characteristics.
For the 2022 harvest, the Company contracted for approximately 32,000 tons of grapes at an estimated cost of approximately $68.7 million, subject to the final determination of yield quantities and our quality acceptance provisions being met. For the 2021 harvest, the Company purchased 34,000 tons of grapes at a cost of approximately $68.1 million, which was recognized in inventory during the year ended July 31, 2022. For the 2020 harvest, the Company purchased 12,000 tons of grapes at a cost of approximately $26.5 million, which was recognized in inventory during the year ended July 31, 2021.
Purchase commitments
The Company has ongoing commitments to purchase approximately 8,553 barrels for a total of $8.8 million, of which approximately $7.3 million will be paid in Euros. In order to reduce the foreign exchange risk associated with the Euro to U.S. Dollar conversion rate, the Company entered into foreign currency forward contracts aligning settlement dates with expected barrel delivery and the anticipated payments to various coopers. The Company does not enter into these contracts for speculative purposes. Gains and losses on these contracts are recorded in the Consolidated Statements of Operations. See Note 10 (Derivative instruments) for the total notional value and impact on the current period consolidated financial statements due to foreign currency forward contracts.
The Company enters into various contracts with third-parties for custom crush, storage and mobile bottling services. The costs related to these contracts are recorded in the period the service is provided. The contracts for custom crush services typically have minimums that the Company is required to pay if certain grape volume thresholds are not delivered. The Company does not record these minimums related to service contracts as contingent liabilities on the Consolidated Statements of Financial Position given the harvest yield size, resulting volumes and qualities of grape deliveries are not known or estimable until harvest, when all related contingencies would be resolved.
COVID-19
In March 2020, the World Health Organization declared a global pandemic due to the spread of COVID-19, the disease caused by a strain of virus. The Company incurred incremental costs during periods of capacity restrictions or mandatory closure totaling $0.7 million and $1.4 million for the fiscal years ended July 31, 2021 and 2020, respectively. These costs include tasting room expenses and other immaterial costs. The estimates and assumptions made by Management to quantify the effect of COVID-19 disruption were based on available information at the time each assumption was made. No costs were incurred for the year ended July 31, 2022.
The COVID-19 pandemic, is an ongoing global pandemic which continues to evolve. At this time, the Company is unable to fully estimate the long-term impacts to the business, financial condition, operational results or future cash flows, as the pandemic is ongoing in all markets in which the Company operates.
Contingent liabilities
The Company evaluates pending or threatened litigation, operational events which could result in regulatory or civil penalties, environmental risks and other sources of potential contingent liabilities during the year. In accordance with applicable accounting guidance, the Company establishes an accrued liability when those matters present loss contingencies which are both probable and reasonably estimable. For the years ended July 31, 2022 and 2021, there were no material contingent obligations requiring accrual or disclosure.
In the ordinary course of business, the Company enters into agreements containing standard indemnification provisions. The aggregate maximum potential future liability of the Company under such indemnification provisions is uncertain, as these involve potential future claims against the Company that have not occurred. The Company expects the risk of any future obligations under these indemnification provisions to be remote. As of the fiscal years ended July 31, 2022 and 2021, no amounts have been accrued related to such indemnification provisions.

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘10-K’ Filing    Date    Other Filings
Filed on:9/28/228-K
For Period end:7/31/22
7/31/2110-K
7/31/20
 List all Filings 

4 Subsequent Filings that Reference this Filing

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 9/27/23  Duckhorn Portfolio, Inc.          10-K        7/31/23  109:11M
 4/05/23  Duckhorn Portfolio, Inc.          424B7                  2:453K                                   Donnelley … Solutions/FA
 4/03/23  Duckhorn Portfolio, Inc.          424B7                  1:420K                                   Donnelley … Solutions/FA
12/30/22  Duckhorn Portfolio, Inc.          10-K/A      7/31/22   16:413K                                   Donnelley … Solutions/FA

6 Previous Filings that this Filing References

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 6/02/22  Duckhorn Portfolio, Inc.          10-Q        4/30/22   77:6.6M
10/04/21  Duckhorn Portfolio, Inc.          10-K        7/31/21   98:10M
 3/30/21  Duckhorn Portfolio, Inc.          8-K:1,3,5,9 3/22/21    7:515K                                   Donnelley … Solutions/FA
 3/10/21  Duckhorn Portfolio, Inc.          S-1/A                 11:16M                                    Donnelley … Solutions/FA
 3/03/21  Duckhorn Portfolio, Inc.          S-1/A                  9:13M                                    Donnelley … Solutions/FA
 2/23/21  Duckhorn Portfolio, Inc.          S-1                   17:15M                                    Donnelley … Solutions/FA
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Filing Submission 0001835256-22-000063   –   Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)
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