☒
|
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
46-2078182
|
||
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
||
One PPG Place,
|
Pittsburgh,
|
Pennsylvania
|
|
15222
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
Title of each class
|
Trading Symbol
|
Name of exchange on which registered
|
Common stock, $0.01 par value
|
KHC
|
The Nasdaq Stock Market LLC
|
Large accelerated filer
|
☒
|
|
Accelerated filer
|
☐
|
|
|
|
Non-accelerated filer
|
☐
|
|
Smaller reporting company
|
☐
|
|
Emerging growth company
|
☐
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
|
|
|
(As Restated)
|
|
|
|
(As Restated)
|
||||||||
Net sales
|
$
|
6,406
|
|
|
$
|
6,690
|
|
|
$
|
12,365
|
|
|
$
|
12,994
|
|
Cost of products sold
|
4,324
|
|
|
4,343
|
|
|
8,272
|
|
|
8,383
|
|
||||
Gross profit
|
2,082
|
|
|
2,347
|
|
|
4,093
|
|
|
4,611
|
|
||||
Selling, general and administrative expenses, excluding impairment losses
|
750
|
|
|
756
|
|
|
1,579
|
|
|
1,520
|
|
||||
Goodwill impairment losses
|
124
|
|
|
133
|
|
|
744
|
|
|
133
|
|
||||
Intangible asset impairment losses
|
474
|
|
|
101
|
|
|
474
|
|
|
101
|
|
||||
Selling, general and administrative expenses
|
1,348
|
|
|
990
|
|
|
2,797
|
|
|
1,754
|
|
||||
Operating income/(loss)
|
734
|
|
|
1,357
|
|
|
1,296
|
|
|
2,857
|
|
||||
Interest expense
|
316
|
|
|
316
|
|
|
637
|
|
|
633
|
|
||||
Other expense/(income)
|
(133
|
)
|
|
(20
|
)
|
|
(513
|
)
|
|
(110
|
)
|
||||
Income/(loss) before income taxes
|
551
|
|
|
1,061
|
|
|
1,172
|
|
|
2,334
|
|
||||
Provision for/(benefit from) income taxes
|
103
|
|
|
308
|
|
|
320
|
|
|
578
|
|
||||
Net income/(loss)
|
448
|
|
|
753
|
|
|
852
|
|
|
1,756
|
|
||||
Net income/(loss) attributable to noncontrolling interest
|
(1
|
)
|
|
(1
|
)
|
|
(2
|
)
|
|
(1
|
)
|
||||
Net income/(loss) attributable to common shareholders
|
$
|
449
|
|
|
$
|
754
|
|
|
$
|
854
|
|
|
$
|
1,757
|
|
Per share data applicable to common shareholders:
|
|
|
|
|
|
|
|
||||||||
Basic earnings/(loss)
|
$
|
0.37
|
|
|
$
|
0.62
|
|
|
$
|
0.70
|
|
|
$
|
1.44
|
|
Diluted earnings/(loss)
|
0.37
|
|
|
0.62
|
|
|
0.70
|
|
|
1.43
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
|
|
|
(As Restated)
|
|
|
|
(As Restated)
|
||||||||
Net income/(loss)
|
$
|
448
|
|
|
$
|
753
|
|
|
$
|
852
|
|
|
$
|
1,756
|
|
Other comprehensive income/(loss), net of tax:
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
(69
|
)
|
|
(862
|
)
|
|
150
|
|
|
(665
|
)
|
||||
Net deferred gains/(losses) on net investment hedges
|
10
|
|
|
219
|
|
|
(4
|
)
|
|
145
|
|
||||
Amounts excluded from the effectiveness assessment of net investment hedges
|
6
|
|
|
—
|
|
|
10
|
|
|
—
|
|
||||
Net deferred losses/(gains) on net investment hedges reclassified to net income/(loss)
|
(6
|
)
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
||||
Net deferred gains/(losses) on cash flow hedges
|
(10
|
)
|
|
34
|
|
|
(26
|
)
|
|
56
|
|
||||
Amounts excluded from the effectiveness assessment of cash flow hedges
|
7
|
|
|
—
|
|
|
13
|
|
|
—
|
|
||||
Net deferred losses/(gains) on cash flow hedges reclassified to net income/(loss)
|
3
|
|
|
(9
|
)
|
|
(5
|
)
|
|
(22
|
)
|
||||
Net actuarial gains/(losses) arising during the period
|
(5
|
)
|
|
53
|
|
|
(5
|
)
|
|
53
|
|
||||
Net postemployment benefit losses/(gains) reclassified to net income/(loss)
|
(59
|
)
|
|
(17
|
)
|
|
(117
|
)
|
|
(75
|
)
|
||||
Total other comprehensive income/(loss)
|
(123
|
)
|
|
(582
|
)
|
|
12
|
|
|
(508
|
)
|
||||
Total comprehensive income/(loss)
|
325
|
|
|
171
|
|
|
864
|
|
|
1,248
|
|
||||
Comprehensive income/(loss) attributable to noncontrolling interest
|
(1
|
)
|
|
(7
|
)
|
|
10
|
|
|
(12
|
)
|
||||
Comprehensive income/(loss) attributable to common shareholders
|
$
|
326
|
|
|
$
|
178
|
|
|
$
|
854
|
|
|
$
|
1,260
|
|
|
June 29, 2019
|
|
December 29, 2018
|
||||
ASSETS
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,452
|
|
|
$
|
1,130
|
|
Trade receivables (net of allowances of $32 at June 29, 2019 and $24 at December 29, 2018)
|
2,049
|
|
|
2,129
|
|
||
Income taxes receivable
|
105
|
|
|
152
|
|
||
Inventories
|
3,074
|
|
|
2,667
|
|
||
Prepaid expenses
|
395
|
|
|
400
|
|
||
Other current assets
|
1,058
|
|
|
1,221
|
|
||
Assets held for sale
|
1,035
|
|
|
1,376
|
|
||
Total current assets
|
9,168
|
|
|
9,075
|
|
||
Property, plant and equipment, net
|
7,023
|
|
|
7,078
|
|
||
Goodwill
|
35,989
|
|
|
36,503
|
|
||
Intangible assets, net
|
48,943
|
|
|
49,468
|
|
||
Other non-current assets
|
2,078
|
|
|
1,337
|
|
||
TOTAL ASSETS
|
$
|
103,201
|
|
|
$
|
103,461
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Commercial paper and other short-term debt
|
$
|
1
|
|
|
$
|
21
|
|
Current portion of long-term debt
|
1,298
|
|
|
377
|
|
||
Trade payables
|
4,153
|
|
|
4,153
|
|
||
Accrued marketing
|
508
|
|
|
722
|
|
||
Interest payable
|
384
|
|
|
408
|
|
||
Other current liabilities
|
1,446
|
|
|
1,767
|
|
||
Liabilities held for sale
|
7
|
|
|
55
|
|
||
Total current liabilities
|
7,797
|
|
|
7,503
|
|
||
Long-term debt
|
29,832
|
|
|
30,770
|
|
||
Deferred income taxes
|
12,128
|
|
|
12,202
|
|
||
Accrued postemployment costs
|
308
|
|
|
306
|
|
||
Other non-current liabilities
|
1,459
|
|
|
902
|
|
||
TOTAL LIABILITIES
|
51,524
|
|
|
51,683
|
|
||
Commitments and Contingencies (Note 17)
|
|
|
|
||||
Redeemable noncontrolling interest
|
2
|
|
|
3
|
|
||
Equity:
|
|
|
|
||||
Common stock, $0.01 par value (5,000 shares authorized; 1,224 shares issued and 1,220 shares outstanding at June 29, 2019; 1,224 shares issued and 1,220 shares outstanding at December 29, 2018)
|
12
|
|
|
12
|
|
||
Additional paid-in capital
|
57,769
|
|
|
58,723
|
|
||
Retained earnings/(deficit)
|
(4,140
|
)
|
|
(4,853
|
)
|
||
Accumulated other comprehensive income/(losses)
|
(1,807
|
)
|
|
(1,943
|
)
|
||
Treasury stock, at cost (4 shares at June 29, 2019 and December 29, 2018)
|
(291
|
)
|
|
(282
|
)
|
||
Total shareholders' equity
|
51,543
|
|
|
51,657
|
|
||
Noncontrolling interest
|
132
|
|
|
118
|
|
||
TOTAL EQUITY
|
51,675
|
|
|
51,775
|
|
||
TOTAL LIABILITIES AND EQUITY
|
$
|
103,201
|
|
|
$
|
103,461
|
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Retained Earnings/(Deficit)
|
|
Accumulated Other Comprehensive Income/(Losses)
|
|
Treasury Stock, at Cost
|
|
Noncontrolling Interest
|
|
Total Equity
|
||||||||||||||
Balance at December 29, 2018
|
$
|
12
|
|
|
$
|
58,723
|
|
|
$
|
(4,853
|
)
|
|
$
|
(1,943
|
)
|
|
$
|
(282
|
)
|
|
$
|
118
|
|
|
$
|
51,775
|
|
Net income/(loss) excluding redeemable noncontrolling interest
|
—
|
|
|
—
|
|
|
405
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
405
|
|
|||||||
Other comprehensive income/(loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
123
|
|
|
—
|
|
|
12
|
|
|
135
|
|
|||||||
Dividends declared-common stock ($0.40 per share)
|
—
|
|
|
(488
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(488
|
)
|
|||||||
Cumulative effect of accounting standards adopted in the period
|
—
|
|
|
—
|
|
|
(136
|
)
|
|
136
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Exercise of stock options, issuance of other stock awards, and other
|
—
|
|
|
17
|
|
|
(2
|
)
|
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
6
|
|
|||||||
Balance at March 30, 2019
|
$
|
12
|
|
|
$
|
58,252
|
|
|
$
|
(4,586
|
)
|
|
$
|
(1,684
|
)
|
|
$
|
(291
|
)
|
|
$
|
130
|
|
|
$
|
51,833
|
|
Net income/(loss) excluding redeemable noncontrolling interest
|
—
|
|
|
—
|
|
|
449
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
449
|
|
|||||||
Other comprehensive income/(loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
(123
|
)
|
|
—
|
|
|
—
|
|
|
(123
|
)
|
|||||||
Dividends declared-common stock ($0.40 per share)
|
—
|
|
|
(488
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(488
|
)
|
|||||||
Exercise of stock options, issuance of other stock awards, and other
|
—
|
|
|
5
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
2
|
|
|
4
|
|
|||||||
Balance at June 29, 2019
|
12
|
|
|
57,769
|
|
|
(4,140
|
)
|
|
(1,807
|
)
|
|
(291
|
)
|
|
132
|
|
|
51,675
|
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Retained Earnings/(Deficit)
|
|
Accumulated Other Comprehensive Income/(Losses)
|
|
Treasury Stock, at Cost
|
|
Noncontrolling Interest
|
|
Total Equity
|
||||||||||||||
Balance at December 30, 2017
|
$
|
12
|
|
|
$
|
58,634
|
|
|
$
|
8,495
|
|
|
$
|
(1,054
|
)
|
|
$
|
(224
|
)
|
|
$
|
207
|
|
|
$
|
66,070
|
|
Net income/(loss) excluding redeemable noncontrolling interest
|
—
|
|
|
—
|
|
|
1,003
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
1,008
|
|
|||||||
Other comprehensive income/(loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
79
|
|
|
—
|
|
|
(5
|
)
|
|
74
|
|
|||||||
Dividends declared-common stock ($0.625 per share)
|
—
|
|
|
—
|
|
|
(762
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(762
|
)
|
|||||||
Cumulative effect of accounting standards adopted in the period
|
—
|
|
|
—
|
|
|
(95
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(95
|
)
|
|||||||
Exercise of stock options, issuance of other stock awards, and other
|
—
|
|
|
22
|
|
|
(7
|
)
|
|
—
|
|
|
(16
|
)
|
|
—
|
|
|
(1
|
)
|
|||||||
Balance at March 31, 2018 (As Restated)
|
$
|
12
|
|
|
$
|
58,656
|
|
|
$
|
8,634
|
|
|
$
|
(975
|
)
|
|
$
|
(240
|
)
|
|
$
|
207
|
|
|
$
|
66,294
|
|
Net income/(loss) excluding redeemable noncontrolling interest
|
—
|
|
|
—
|
|
|
754
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
754
|
|
|||||||
Other comprehensive income/(loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
(576
|
)
|
|
—
|
|
|
(6
|
)
|
|
(582
|
)
|
|||||||
Dividends declared-common stock ($0.625 per share)
|
—
|
|
|
—
|
|
|
(762
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(762
|
)
|
|||||||
Exercise of stock options, issuance of other stock awards, and other
|
—
|
|
|
33
|
|
|
(2
|
)
|
|
—
|
|
|
(14
|
)
|
|
(13
|
)
|
|
4
|
|
|||||||
Balance at June 30, 2018 (As Restated)
|
12
|
|
|
58,689
|
|
|
8,624
|
|
|
(1,551
|
)
|
|
(254
|
)
|
|
188
|
|
|
65,708
|
|
|
For the Six Months Ended
|
||||||
|
June 29, 2019
|
|
June 30, 2018
|
||||
|
|
|
(As Restated)
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net income/(loss)
|
$
|
852
|
|
|
$
|
1,756
|
|
Adjustments to reconcile net income/(loss) to operating cash flows:
|
|
|
|
|
|||
Depreciation and amortization
|
494
|
|
|
462
|
|
||
Amortization of postretirement benefit plans prior service costs/(credits)
|
(153
|
)
|
|
(183
|
)
|
||
Equity award compensation expense
|
15
|
|
|
27
|
|
||
Deferred income tax provision/(benefit)
|
(40
|
)
|
|
79
|
|
||
Postemployment benefit plan contributions
|
(13
|
)
|
|
(60
|
)
|
||
Goodwill and intangible asset impairment losses
|
1,218
|
|
|
234
|
|
||
Nonmonetary currency devaluation
|
6
|
|
|
67
|
|
||
Loss/(gain) on sale of business
|
(246
|
)
|
|
15
|
|
||
Other items, net
|
(131
|
)
|
|
12
|
|
||
Changes in current assets and liabilities:
|
|
|
|
||||
Trade receivables
|
75
|
|
|
(2,001
|
)
|
||
Inventories
|
(484
|
)
|
|
(428
|
)
|
||
Accounts payable
|
63
|
|
|
127
|
|
||
Other current assets
|
5
|
|
|
(44
|
)
|
||
Other current liabilities
|
(336
|
)
|
|
153
|
|
||
Net cash provided by/(used for) operating activities
|
1,325
|
|
|
216
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
||||
Cash receipts on sold receivables
|
—
|
|
|
1,221
|
|
||
Capital expenditures
|
(448
|
)
|
|
(438
|
)
|
||
Payments to acquire business, net of cash acquired
|
(200
|
)
|
|
(215
|
)
|
||
Proceeds from sale of business, net of cash disposed
|
640
|
|
|
18
|
|
||
Other investing activities, net
|
(10
|
)
|
|
(7
|
)
|
||
Net cash provided by/(used for) investing activities
|
(18
|
)
|
|
579
|
|
||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
||||
Repayments of long-term debt
|
(4
|
)
|
|
(12
|
)
|
||
Proceeds from issuance of long-term debt
|
18
|
|
|
2,990
|
|
||
Proceeds from issuance of commercial paper
|
377
|
|
|
1,525
|
|
||
Repayments of commercial paper
|
(377
|
)
|
|
(1,950
|
)
|
||
Dividends paid
|
(976
|
)
|
|
(1,659
|
)
|
||
Other financing activities, net
|
(15
|
)
|
|
(3
|
)
|
||
Net cash provided by/(used for) financing activities
|
(977
|
)
|
|
891
|
|
||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
|
(8
|
)
|
|
(80
|
)
|
||
Cash, cash equivalents, and restricted cash
|
|
|
|
||||
Net increase/(decrease)
|
322
|
|
|
1,606
|
|
||
Balance at beginning of period
|
1,136
|
|
|
1,769
|
|
||
Balance at end of period
|
$
|
1,458
|
|
|
$
|
3,375
|
|
NON-CASH INVESTING ACTIVITIES:
|
|
|
|
||||
Beneficial interest obtained in exchange for securitized trade receivables
|
$
|
—
|
|
|
$
|
899
|
|
|
For the Three Months Ended June 30, 2018
|
||||||||||||
|
As Previously Reported
|
|
Restatement Impacts(1)
|
|
Restatement Reference
|
|
As Restated
|
||||||
Net sales
|
$
|
6,686
|
|
|
$
|
4
|
|
|
(f)
|
|
$
|
6,690
|
|
Cost of products sold
|
4,321
|
|
|
22
|
|
|
(a)(b)(f)
|
|
4,343
|
|
|||
Gross profit
|
2,365
|
|
|
(18
|
)
|
|
|
|
2,347
|
|
|||
Selling, general and administrative expenses, excluding impairment losses
|
771
|
|
|
(15
|
)
|
|
|
|
756
|
|
|||
Goodwill impairment losses
|
164
|
|
|
(31
|
)
|
|
(e)
|
|
133
|
|
|||
Intangible asset impairment losses
|
101
|
|
|
—
|
|
|
|
|
101
|
|
|||
Selling, general and administrative expenses
|
1,036
|
|
|
(46
|
)
|
|
|
|
990
|
|
|||
Operating income/(loss)
|
1,329
|
|
|
28
|
|
|
|
|
1,357
|
|
|||
Interest expense
|
318
|
|
|
(2
|
)
|
|
(b)(f)
|
|
316
|
|
|||
Other expense/(income)
|
(35
|
)
|
|
15
|
|
|
|
|
(20
|
)
|
|||
Income/(loss) before income taxes
|
1,046
|
|
|
15
|
|
|
|
|
1,061
|
|
|||
Provision for/(benefit from) income taxes
|
291
|
|
|
17
|
|
|
(a)(b)(d)(e)(f)
|
|
308
|
|
|||
Net income/(loss)
|
755
|
|
|
(2
|
)
|
|
|
|
753
|
|
|||
Net income/(loss) attributable to noncontrolling interest
|
(1
|
)
|
|
—
|
|
|
|
|
(1
|
)
|
|||
Net income/(loss) attributable to common shareholders
|
$
|
756
|
|
|
$
|
(2
|
)
|
|
|
|
$
|
754
|
|
Per share data applicable to common shareholders:
|
|
|
|
|
|
|
|
||||||
Basic earnings/(loss)
|
$
|
0.62
|
|
|
$
|
—
|
|
|
|
|
$
|
0.62
|
|
Diluted earnings/(loss)
|
0.62
|
|
|
—
|
|
|
|
|
0.62
|
|
(1)
|
We have reclassified our $15 million pre-tax loss on the sale of our South African business from SG&A to other expense/(income) in order to conform with current period presentation. This reclassification has been included in the restatement impacts column above.
|
|
For the Six Months Ended June 30, 2018
|
||||||||||||
|
As Previously Reported
|
|
Restatement Impacts(1)
|
|
Restatement Reference
|
|
As Restated
|
||||||
Net sales
|
$
|
12,990
|
|
|
$
|
4
|
|
|
(f)
|
|
$
|
12,994
|
|
Cost of products sold
|
8,380
|
|
|
3
|
|
|
(a)(b)(f)
|
|
8,383
|
|
|||
Gross profit
|
4,610
|
|
|
1
|
|
|
|
|
4,611
|
|
|||
Selling, general and administrative expenses, excluding impairment losses
|
1,535
|
|
|
(15
|
)
|
|
|
|
1,520
|
|
|||
Goodwill impairment losses
|
164
|
|
|
(31
|
)
|
|
(e)
|
|
133
|
|
|||
Intangible asset impairment losses
|
101
|
|
|
—
|
|
|
|
|
101
|
|
|||
Selling, general and administrative expenses
|
1,800
|
|
|
(46
|
)
|
|
|
|
1,754
|
|
|||
Operating income/(loss)
|
2,810
|
|
|
47
|
|
|
|
|
2,857
|
|
|||
Interest expense
|
635
|
|
|
(2
|
)
|
|
(b)(f)
|
|
633
|
|
|||
Other expense/(income)
|
(125
|
)
|
|
15
|
|
|
|
|
(110
|
)
|
|||
Income/(loss) before income taxes
|
2,300
|
|
|
34
|
|
|
|
|
2,334
|
|
|||
Provision for/(benefit from) income taxes
|
552
|
|
|
26
|
|
|
(a)(b)(d)(e)(f)
|
|
578
|
|
|||
Net income/(loss)
|
1,748
|
|
|
8
|
|
|
|
|
1,756
|
|
|||
Net income/(loss) attributable to noncontrolling interest
|
(1
|
)
|
|
—
|
|
|
|
|
(1
|
)
|
|||
Net income/(loss) attributable to common shareholders
|
$
|
1,749
|
|
|
$
|
8
|
|
|
|
|
$
|
1,757
|
|
Per share data applicable to common shareholders:
|
|
|
|
|
|
|
|
||||||
Basic earnings/(loss)
|
$
|
1.43
|
|
|
$
|
0.01
|
|
|
|
|
$
|
1.44
|
|
Diluted earnings/(loss)
|
1.43
|
|
|
—
|
|
|
|
|
1.43
|
|
(1)
|
We have reclassified our $15 million pre-tax loss on the sale of our South African business from SG&A to other expense/(income) in order to conform with current period presentation. This reclassification has been included in the restatement impacts column above.
|
|
For the Three Months Ended June 30, 2018
|
||||||||||||
|
As Previously Reported
|
|
Restatement Impacts
|
|
Restatement Reference
|
|
As Restated
|
||||||
Net income/(loss)
|
$
|
755
|
|
|
$
|
(2
|
)
|
|
(a)(b)(d)(e)(f)
|
|
$
|
753
|
|
Other comprehensive income/(loss), net of tax:
|
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
(868
|
)
|
|
6
|
|
|
(b)(d)(e)
|
|
(862
|
)
|
|||
Net deferred gains/(losses) on net investment hedges
|
219
|
|
|
—
|
|
|
|
|
219
|
|
|||
Net deferred gains/(losses) on cash flow hedges
|
34
|
|
|
—
|
|
|
|
|
34
|
|
|||
Net deferred losses/(gains) on cash flow hedges reclassified to net income/(loss)
|
(9
|
)
|
|
—
|
|
|
|
|
(9
|
)
|
|||
Net actuarial gains/(losses) arising during the period
|
53
|
|
|
—
|
|
|
|
|
53
|
|
|||
Net postemployment benefit losses/(gains) reclassified to net income/(loss)
|
(17
|
)
|
|
—
|
|
|
|
|
(17
|
)
|
|||
Total other comprehensive income/(loss)
|
(588
|
)
|
|
6
|
|
|
|
|
(582
|
)
|
|||
Total comprehensive income/(loss)
|
167
|
|
|
4
|
|
|
|
|
171
|
|
|||
Comprehensive income/(loss) attributable to noncontrolling interest
|
(7
|
)
|
|
—
|
|
|
|
|
(7
|
)
|
|||
Comprehensive income/(loss) attributable to Kraft Heinz
|
$
|
174
|
|
|
$
|
4
|
|
|
|
|
$
|
178
|
|
|
For the Six Months Ended June 30, 2018
|
||||||||||||
|
As Previously Reported
|
|
Restatement Impacts
|
|
Restatement Reference
|
|
As Restated
|
||||||
Net income/(loss)
|
$
|
1,748
|
|
|
$
|
8
|
|
|
(a)(b)(d)(e)(f)
|
|
$
|
1,756
|
|
Other comprehensive income/(loss), net of tax:
|
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
(671
|
)
|
|
6
|
|
|
(b)(d)(e)
|
|
(665
|
)
|
|||
Net deferred gains/(losses) on net investment hedges
|
145
|
|
|
—
|
|
|
|
|
145
|
|
|||
Net deferred gains/(losses) on cash flow hedges
|
56
|
|
|
—
|
|
|
|
|
56
|
|
|||
Net deferred losses/(gains) on cash flow hedges reclassified to net income/(loss)
|
(22
|
)
|
|
—
|
|
|
|
|
(22
|
)
|
|||
Net actuarial gains/(losses) arising during the period
|
53
|
|
|
—
|
|
|
|
|
53
|
|
|||
Net postemployment benefit losses/(gains) reclassified to net income/(loss)
|
(75
|
)
|
|
—
|
|
|
|
|
(75
|
)
|
|||
Total other comprehensive income/(loss)
|
(514
|
)
|
|
6
|
|
|
|
|
(508
|
)
|
|||
Total comprehensive income/(loss)
|
1,234
|
|
|
14
|
|
|
|
|
1,248
|
|
|||
Comprehensive income/(loss) attributable to noncontrolling interest
|
(12
|
)
|
|
—
|
|
|
|
|
(12
|
)
|
|||
Comprehensive income/(loss) attributable to Kraft Heinz
|
$
|
1,246
|
|
|
$
|
14
|
|
|
|
|
$
|
1,260
|
|
|
June 30, 2018
|
||||||||||||
|
As Previously Reported
|
|
Restatement Impacts
|
|
Restatement Reference
|
|
As Restated
|
||||||
ASSETS
|
|
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
3,369
|
|
|
$
|
—
|
|
|
|
|
$
|
3,369
|
|
Trade receivables (net of allowances of $24 at June 30, 2018)
|
1,950
|
|
|
—
|
|
|
|
|
1,950
|
|
|||
Sold receivables
|
37
|
|
|
—
|
|
|
|
|
37
|
|
|||
Income taxes receivable
|
177
|
|
|
34
|
|
|
(a)(b)(d)(f)
|
|
211
|
|
|||
Inventories
|
3,161
|
|
|
(67
|
)
|
|
(c)(f)
|
|
3,094
|
|
|||
Prepaid expenses
|
388
|
|
|
—
|
|
|
|
|
388
|
|
|||
Other current assets
|
419
|
|
|
12
|
|
|
(a)(c)(f)
|
|
431
|
|
|||
Total current assets
|
9,501
|
|
|
(21
|
)
|
|
|
|
9,480
|
|
|||
Property, plant and equipment, net
|
7,258
|
|
|
(141
|
)
|
|
(b)(f)
|
|
7,117
|
|
|||
Goodwill
|
44,270
|
|
|
32
|
|
|
(e)(f)
|
|
44,302
|
|
|||
Intangible assets, net
|
59,101
|
|
|
(17
|
)
|
|
(e)
|
|
59,084
|
|
|||
Other non-current assets
|
1,766
|
|
|
—
|
|
|
|
|
1,766
|
|
|||
TOTAL ASSETS
|
$
|
121,896
|
|
|
$
|
(147
|
)
|
|
|
|
$
|
121,749
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
||||||
Commercial paper and other short-term debt
|
$
|
34
|
|
|
$
|
—
|
|
|
|
|
$
|
34
|
|
Current portion of long-term debt
|
2,754
|
|
|
(31
|
)
|
|
(b)(f)
|
|
2,723
|
|
|||
Trade payables
|
4,326
|
|
|
(90
|
)
|
|
(f)
|
|
4,236
|
|
|||
Accrued marketing
|
474
|
|
|
6
|
|
|
(f)
|
|
480
|
|
|||
Interest payable
|
404
|
|
|
—
|
|
|
|
|
404
|
|
|||
Other current liabilities
|
1,099
|
|
|
137
|
|
|
(a)(f)
|
|
1,236
|
|
|||
Total current liabilities
|
9,091
|
|
|
22
|
|
|
|
|
9,113
|
|
|||
Long-term debt
|
31,380
|
|
|
(111
|
)
|
|
(b)(f)
|
|
31,269
|
|
|||
Deferred income taxes
|
14,230
|
|
|
30
|
|
|
(a)(d)(e)(f)
|
|
14,260
|
|
|||
Accrued postemployment costs
|
394
|
|
|
—
|
|
|
|
|
394
|
|
|||
Other non-current liabilities
|
929
|
|
|
69
|
|
|
(a)
|
|
998
|
|
|||
TOTAL LIABILITIES
|
56,024
|
|
|
10
|
|
|
|
|
56,034
|
|
|||
Commitments and Contingencies
|
|
|
|
|
|
|
|
||||||
Redeemable noncontrolling interest
|
7
|
|
|
—
|
|
|
|
|
7
|
|
|||
Equity:
|
|
|
|
|
|
|
|
||||||
Common stock, $0.01 par value (5,000 shares authorized; 1,222 shares issued and 1,219 shares outstanding at June 30, 2018)
|
12
|
|
|
—
|
|
|
|
|
12
|
|
|||
Additional paid-in capital
|
58,766
|
|
|
(77
|
)
|
|
(c)
|
|
58,689
|
|
|||
Retained earnings/(deficit)
|
8,710
|
|
|
(86
|
)
|
|
(a)(b)(c)(d)(e)(f)
|
|
8,624
|
|
|||
Accumulated other comprehensive income/(losses)
|
(1,557
|
)
|
|
6
|
|
|
(b)(d)(e)
|
|
(1,551
|
)
|
|||
Treasury stock, at cost (3 shares at June 30, 2018)
|
(254
|
)
|
|
—
|
|
|
|
|
(254
|
)
|
|||
Total shareholders' equity
|
65,677
|
|
|
(157
|
)
|
|
|
|
65,520
|
|
|||
Noncontrolling interest
|
188
|
|
|
—
|
|
|
|
|
188
|
|
|||
TOTAL EQUITY
|
65,865
|
|
|
(157
|
)
|
|
|
|
65,708
|
|
|||
TOTAL LIABILITIES AND EQUITY
|
$
|
121,896
|
|
|
$
|
(147
|
)
|
|
|
|
$
|
121,749
|
|
|
As Previously Reported
|
||||||||||||||||||||||||||||
|
Restatement Reference
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Retained Earnings/(Deficit)
|
|
Accumulated Other Comprehensive Income/(Losses)
|
|
Treasury Stock, at Cost
|
|
Noncontrolling Interest
|
|
Total Equity
|
||||||||||||||
Balance at December 30, 2017
|
|
|
$
|
12
|
|
|
$
|
58,711
|
|
|
$
|
8,589
|
|
|
$
|
(1,054
|
)
|
|
$
|
(224
|
)
|
|
$
|
207
|
|
|
$
|
66,241
|
|
Net income/(loss) excluding redeemable noncontrolling interest
|
|
|
—
|
|
|
—
|
|
|
993
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
998
|
|
|||||||
Other comprehensive income/(loss) excluding redeemable noncontrolling interest
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
79
|
|
|
—
|
|
|
(5
|
)
|
|
74
|
|
|||||||
Dividends declared-common stock ($0.625 per share)
|
|
|
—
|
|
|
—
|
|
|
(762
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(762
|
)
|
|||||||
Cumulative effect of accounting standards adopted in the period
|
|
|
—
|
|
|
—
|
|
|
(95
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(95
|
)
|
|||||||
Exercise of stock options, issuance of other stock awards, and other
|
|
|
—
|
|
|
22
|
|
|
(7
|
)
|
|
—
|
|
|
(16
|
)
|
|
—
|
|
|
(1
|
)
|
|||||||
Balance at March 31, 2018
|
|
|
12
|
|
|
58,733
|
|
|
8,718
|
|
|
(975
|
)
|
|
(240
|
)
|
|
207
|
|
|
66,455
|
|
|||||||
Net income/(loss) excluding redeemable noncontrolling interest
|
|
|
—
|
|
|
—
|
|
|
756
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
756
|
|
|||||||
Other comprehensive income/(loss) excluding redeemable noncontrolling interest
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(582
|
)
|
|
—
|
|
|
(6
|
)
|
|
(588
|
)
|
|||||||
Dividends declared-common stock ($0.625 per share)
|
|
|
—
|
|
|
—
|
|
|
(762
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(762
|
)
|
|||||||
Exercise of stock options, issuance of other stock awards, and other
|
|
|
—
|
|
|
33
|
|
|
(2
|
)
|
|
—
|
|
|
(14
|
)
|
|
(13
|
)
|
|
4
|
|
|||||||
Balance at June 30, 2018
|
|
|
$
|
12
|
|
|
$
|
58,766
|
|
|
$
|
8,710
|
|
|
$
|
(1,557
|
)
|
|
$
|
(254
|
)
|
|
$
|
188
|
|
|
$
|
65,865
|
|
|
Restatement Impacts
|
||||||||||||||||||||||||||||
|
Restatement Reference
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Retained Earnings/(Deficit)
|
|
Accumulated Other Comprehensive Income/(Losses)
|
|
Treasury Stock, at Cost
|
|
Noncontrolling Interest
|
|
Total Equity
|
||||||||||||||
Balance at December 30, 2017
|
|
|
$
|
—
|
|
|
$
|
(77
|
)
|
|
$
|
(94
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(171
|
)
|
Net income/(loss) excluding redeemable noncontrolling interest
|
(a)(b)(d)(e)(f)
|
|
—
|
|
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
|||||||
Other comprehensive income/(loss) excluding redeemable noncontrolling interest
|
(b)(d)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Dividends declared-common stock ($0.625 per share)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Cumulative effect of accounting standards adopted in the period
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Exercise of stock options, issuance of other stock awards, and other
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Balance at March 31, 2018
|
|
|
—
|
|
|
(77
|
)
|
|
(84
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(161
|
)
|
|||||||
Net income/(loss) excluding redeemable noncontrolling interest
|
(a)(b)(d)(e)(f)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|||||||
Other comprehensive income/(loss) excluding redeemable noncontrolling interest
|
(b)(d)(e)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|||||||
Dividends declared-common stock ($0.625 per share)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Exercise of stock options, issuance of other stock awards, and other
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Balance at June 30, 2018
|
|
|
$
|
—
|
|
|
$
|
(77
|
)
|
|
$
|
(86
|
)
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(157
|
)
|
|
As Restated
|
||||||||||||||||||||||||||||
|
Restatement Reference
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Retained Earnings/(Deficit)
|
|
Accumulated Other Comprehensive Income/(Losses)
|
|
Treasury Stock, at Cost
|
|
Noncontrolling Interest
|
|
Total Equity
|
||||||||||||||
Balance at December 30, 2017
|
|
|
$
|
12
|
|
|
$
|
58,634
|
|
|
$
|
8,495
|
|
|
$
|
(1,054
|
)
|
|
$
|
(224
|
)
|
|
$
|
207
|
|
|
$
|
66,070
|
|
Net income/(loss) excluding redeemable noncontrolling interest
|
|
|
—
|
|
|
—
|
|
|
1,003
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
1,008
|
|
|||||||
Other comprehensive income/(loss) excluding redeemable noncontrolling interest
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
79
|
|
|
—
|
|
|
(5
|
)
|
|
74
|
|
|||||||
Dividends declared-common stock ($0.625 per share)
|
|
|
—
|
|
|
—
|
|
|
(762
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(762
|
)
|
|||||||
Cumulative effect of accounting standards adopted in the period
|
|
|
—
|
|
|
—
|
|
|
(95
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(95
|
)
|
|||||||
Exercise of stock options, issuance of other stock awards, and other
|
|
|
—
|
|
|
22
|
|
|
(7
|
)
|
|
—
|
|
|
(16
|
)
|
|
—
|
|
|
(1
|
)
|
|||||||
Balance at March 31, 2018
|
|
|
12
|
|
|
58,656
|
|
|
8,634
|
|
|
(975
|
)
|
|
(240
|
)
|
|
207
|
|
|
66,294
|
|
|||||||
Net income/(loss) excluding redeemable noncontrolling interest
|
|
|
—
|
|
|
—
|
|
|
754
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
754
|
|
|||||||
Other comprehensive income/(loss) excluding redeemable noncontrolling interest
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(576
|
)
|
|
—
|
|
|
(6
|
)
|
|
(582
|
)
|
|||||||
Dividends declared-common stock ($0.625 per share)
|
|
|
—
|
|
|
—
|
|
|
(762
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(762
|
)
|
|||||||
Exercise of stock options, issuance of other stock awards, and other
|
|
|
—
|
|
|
33
|
|
|
(2
|
)
|
|
—
|
|
|
(14
|
)
|
|
(13
|
)
|
|
4
|
|
|||||||
Balance at June 30, 2018
|
|
|
$
|
12
|
|
|
$
|
58,689
|
|
|
$
|
8,624
|
|
|
$
|
(1,551
|
)
|
|
$
|
(254
|
)
|
|
$
|
188
|
|
|
$
|
65,708
|
|
|
For the Six Months Ended June 30, 2018
|
||||||||||||
|
As Previously Reported
|
|
Restatement Impacts
|
|
Restatement Reference
|
|
As Restated
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
||||||
Net income/(loss)
|
$
|
1,748
|
|
|
$
|
8
|
|
|
(a)(b)(d)(e)(f)
|
|
$
|
1,756
|
|
Adjustments to reconcile net income/(loss) to operating cash flows:
|
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization
|
476
|
|
|
(14
|
)
|
|
(b)(f)
|
|
462
|
|
|||
Amortization of postretirement benefit plans prior service costs/(credits)
|
(183
|
)
|
|
—
|
|
|
|
|
(183
|
)
|
|||
Equity award compensation expense
|
27
|
|
|
—
|
|
|
|
|
27
|
|
|||
Deferred income tax provision/(benefit)
|
58
|
|
|
21
|
|
|
(a)(d)(e)(f)
|
|
79
|
|
|||
Postemployment benefit plan contributions
|
(60
|
)
|
|
—
|
|
|
|
|
(60
|
)
|
|||
Goodwill and intangible asset impairment losses
|
265
|
|
|
(31
|
)
|
|
(e)
|
|
234
|
|
|||
Nonmonetary currency devaluation
|
67
|
|
|
—
|
|
|
|
|
67
|
|
|||
Loss/(gain) on sale of business
|
15
|
|
|
—
|
|
|
|
|
15
|
|
|||
Other items, net
|
44
|
|
|
(32
|
)
|
|
(a)(f)
|
|
12
|
|
|||
Changes in current assets and liabilities:
|
|
|
|
|
|
|
|
||||||
Trade receivables
|
(2,001
|
)
|
|
—
|
|
|
|
|
(2,001
|
)
|
|||
Inventories
|
(440
|
)
|
|
12
|
|
|
(c)(f)
|
|
(428
|
)
|
|||
Accounts payable
|
143
|
|
|
(16
|
)
|
|
(f)
|
|
127
|
|
|||
Other current assets
|
(66
|
)
|
|
22
|
|
|
(a)(c)(f)
|
|
(44
|
)
|
|||
Other current liabilities
|
136
|
|
|
17
|
|
|
(a)(b)(d)(f)
|
|
153
|
|
|||
Net cash provided by/(used for) operating activities
|
229
|
|
|
(13
|
)
|
|
|
|
216
|
|
|||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
||||||
Cash receipts on sold receivables
|
1,221
|
|
|
—
|
|
|
|
|
1,221
|
|
|||
Capital expenditures
|
(438
|
)
|
|
—
|
|
|
|
|
(438
|
)
|
|||
Payments to acquire business, net of cash acquired
|
(215
|
)
|
|
—
|
|
|
|
|
(215
|
)
|
|||
Proceeds from sale of business
|
18
|
|
|
—
|
|
|
|
|
18
|
|
|||
Other investing activities, net
|
(7
|
)
|
|
—
|
|
|
|
|
(7
|
)
|
|||
Net cash provided by/(used for) investing activities
|
579
|
|
|
—
|
|
|
|
|
579
|
|
|||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
||||||
Repayments of long-term debt
|
(25
|
)
|
|
13
|
|
|
(b)(f)
|
|
(12
|
)
|
|||
Proceeds from issuance of long-term debt
|
2,990
|
|
|
—
|
|
|
|
|
2,990
|
|
|||
Proceeds from issuance of commercial paper
|
1,525
|
|
|
—
|
|
|
|
|
1,525
|
|
|||
Repayments of commercial paper
|
(1,950
|
)
|
|
—
|
|
|
|
|
(1,950
|
)
|
|||
Dividends paid - common stock
|
(1,659
|
)
|
|
—
|
|
|
|
|
(1,659
|
)
|
|||
Other financing activities, net
|
(3
|
)
|
|
—
|
|
|
|
|
(3
|
)
|
|||
Net cash provided by/(used for) financing activities
|
878
|
|
|
13
|
|
|
|
|
891
|
|
|||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
|
(80
|
)
|
|
—
|
|
|
|
|
(80
|
)
|
|||
Cash, cash equivalents, and restricted cash
|
|
|
|
|
|
|
|
||||||
Net increase/(decrease)
|
1,606
|
|
|
—
|
|
|
|
|
1,606
|
|
|||
Balance at beginning of period
|
1,769
|
|
|
—
|
|
|
|
|
1,769
|
|
|||
Balance at end of period
|
$
|
3,375
|
|
|
$
|
—
|
|
|
|
|
$
|
3,375
|
|
NON-CASH INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
||||||
Beneficial interest obtained in exchange for securitized trade receivables
|
$
|
899
|
|
|
$
|
—
|
|
|
|
|
$
|
899
|
|
Cash
|
$
|
2
|
|
Other current assets
|
15
|
|
|
Identifiable intangible assets
|
66
|
|
|
Current liabilities
|
(6
|
)
|
|
Net assets acquired
|
77
|
|
|
Goodwill on acquisition
|
125
|
|
|
Total consideration
|
$
|
202
|
|
|
Fair Value
(in millions of dollars)
|
|
Weighted Average Life
(in years)
|
||
Definite-lived trademarks
|
$
|
52.5
|
|
|
15
|
Customer-related assets
|
13.5
|
|
|
20
|
|
Total
|
$
|
66.0
|
|
|
|
Proceeds
|
$
|
655
|
|
Less investment in Heinz India
|
(355
|
)
|
|
Recognition of tax indemnification
|
(48
|
)
|
|
Other
|
(6
|
)
|
|
Pre-tax gain on sale of Heinz India
|
$
|
246
|
|
|
Severance and Employee Benefit Costs
|
|
Other Exit Costs(a)
|
|
Total
|
||||||
Balance at December 29, 2018
|
$
|
32
|
|
|
$
|
33
|
|
|
$
|
65
|
|
Charges/(credits)
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||
Cash payments
|
(13
|
)
|
|
(3
|
)
|
|
(16
|
)
|
|||
Balance at June 29, 2019
|
$
|
16
|
|
|
$
|
30
|
|
|
$
|
46
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
|
|
|
(As Restated)
|
|
|
|
(As Restated)
|
||||||||
Severance and employee benefit costs - COGS
|
$
|
(3
|
)
|
|
$
|
9
|
|
|
$
|
(3
|
)
|
|
$
|
25
|
|
Severance and employee benefit costs - SG&A
|
(1
|
)
|
|
5
|
|
|
—
|
|
|
10
|
|
||||
Severance and employee benefit costs - Other expense/(income)
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||
Asset-related costs - COGS
|
1
|
|
|
5
|
|
|
3
|
|
|
25
|
|
||||
Asset-related costs - SG&A
|
2
|
|
|
1
|
|
|
9
|
|
|
1
|
|
||||
Other costs - COGS
|
8
|
|
|
65
|
|
|
15
|
|
|
107
|
|
||||
Other costs - SG&A
|
7
|
|
|
8
|
|
|
17
|
|
|
15
|
|
||||
Other costs - Other expense/(income)
|
—
|
|
|
58
|
|
|
—
|
|
|
58
|
|
||||
|
$
|
14
|
|
|
$
|
157
|
|
|
$
|
41
|
|
|
$
|
247
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
United States
|
$
|
7
|
|
|
$
|
69
|
|
|
$
|
26
|
|
|
$
|
121
|
|
Canada
|
4
|
|
|
63
|
|
|
6
|
|
|
66
|
|
||||
EMEA
|
1
|
|
|
7
|
|
|
4
|
|
|
28
|
|
||||
Rest of World
|
—
|
|
|
9
|
|
|
1
|
|
|
9
|
|
||||
General corporate expenses
|
2
|
|
|
9
|
|
|
4
|
|
|
23
|
|
||||
|
$
|
14
|
|
|
$
|
157
|
|
|
$
|
41
|
|
|
$
|
247
|
|
|
June 29, 2019
|
|
December 29, 2018
|
||||
Cash and cash equivalents
|
$
|
1,452
|
|
|
$
|
1,130
|
|
Restricted cash included in other current assets
|
1
|
|
|
1
|
|
||
Restricted cash included in other non-current assets
|
5
|
|
|
5
|
|
||
Cash, cash equivalents, and restricted cash
|
$
|
1,458
|
|
|
$
|
1,136
|
|
|
June 29, 2019
|
|
December 29, 2018
|
||||
Packaging and ingredients
|
$
|
598
|
|
|
$
|
510
|
|
Work in process
|
324
|
|
|
343
|
|
||
Finished product
|
2,152
|
|
|
1,814
|
|
||
Inventories
|
$
|
3,074
|
|
|
$
|
2,667
|
|
|
United States
|
|
Canada
|
|
EMEA
|
|
Rest of World
|
|
Total
|
||||||||||
Balance at December 29, 2018
|
$
|
29,597
|
|
|
$
|
2,438
|
|
|
$
|
3,074
|
|
|
$
|
1,394
|
|
|
$
|
36,503
|
|
Impairment losses
|
(118
|
)
|
|
—
|
|
|
(292
|
)
|
|
(334
|
)
|
|
(744
|
)
|
|||||
Acquisitions
|
125
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
131
|
|
|||||
Translation adjustments and other
|
1
|
|
|
102
|
|
|
(7
|
)
|
|
3
|
|
|
99
|
|
|||||
Balance at June 29, 2019
|
$
|
29,605
|
|
|
$
|
2,540
|
|
|
$
|
2,781
|
|
|
$
|
1,063
|
|
|
$
|
35,989
|
|
Balance at December 29, 2018
|
$
|
43,966
|
|
Impairment losses
|
(474
|
)
|
|
Reclassified to assets held for sale
|
(9
|
)
|
|
Translation adjustments
|
40
|
|
|
Balance at June 29, 2019
|
$
|
43,523
|
|
|
June 29, 2019
|
|
December 29, 2018
|
||||||||||||||||||||
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||
Trademarks
|
$
|
2,518
|
|
|
$
|
(460
|
)
|
|
$
|
2,058
|
|
|
$
|
2,474
|
|
|
$
|
(402
|
)
|
|
$
|
2,072
|
|
Customer-related assets
|
4,114
|
|
|
(764
|
)
|
|
3,350
|
|
|
4,097
|
|
|
(681
|
)
|
|
3,416
|
|
||||||
Other
|
14
|
|
|
(2
|
)
|
|
12
|
|
|
18
|
|
|
(4
|
)
|
|
14
|
|
||||||
|
$
|
6,646
|
|
|
$
|
(1,226
|
)
|
|
$
|
5,420
|
|
|
$
|
6,589
|
|
|
$
|
(1,087
|
)
|
|
$
|
5,502
|
|
|
Number of Stock Options
|
|
Weighted Average Exercise Price
(per share) |
|||
Outstanding at December 29, 2018
|
18,259,965
|
|
|
$
|
44.64
|
|
Forfeited
|
(640,988
|
)
|
|
65.19
|
|
|
Exercised
|
(344,599
|
)
|
|
23.29
|
|
|
Outstanding at June 29, 2019
|
17,274,378
|
|
|
44.31
|
|
|
Number of Units
|
|
Weighted Average Grant Date Fair Value
(per share)
|
|||
Outstanding at December 29, 2018
|
2,338,958
|
|
|
$
|
68.49
|
|
Granted
|
13,032
|
|
|
83.20
|
|
|
Forfeited
|
(400,862
|
)
|
|
64.15
|
|
|
Vested
|
(53,091
|
)
|
|
85.04
|
|
|
Outstanding at June 29, 2019
|
1,898,037
|
|
|
69.04
|
|
|
Number of Units
|
|
Weighted Average Grant Date Fair Value
(per share)
|
|||
Outstanding at December 29, 2018
|
3,252,056
|
|
|
$
|
59.24
|
|
Forfeited
|
(716,515
|
)
|
|
57.23
|
|
|
Outstanding at June 29, 2019
|
2,535,541
|
|
|
59.81
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||||||||||||||||||
|
U.S. Plans
|
|
Non-U.S. Plans
|
|
U.S. Plans
|
|
Non-U.S. Plans
|
||||||||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||||||||||
Service cost
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
4
|
|
|
$
|
5
|
|
|
$
|
4
|
|
|
$
|
5
|
|
|
$
|
8
|
|
|
$
|
10
|
|
Interest cost
|
40
|
|
|
38
|
|
|
13
|
|
|
17
|
|
|
81
|
|
|
77
|
|
|
26
|
|
|
36
|
|
||||||||
Expected return on plan assets
|
(57
|
)
|
|
(64
|
)
|
|
(36
|
)
|
|
(44
|
)
|
|
(114
|
)
|
|
(127
|
)
|
|
(73
|
)
|
|
(92
|
)
|
||||||||
Amortization of unrecognized losses/(gains)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||||||
Settlements
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
58
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
58
|
|
||||||||
Curtailments
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||||||
Special/contractual termination benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
||||||||
Other
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||||||
Net pension cost/(benefit)
|
$
|
(15
|
)
|
|
$
|
(25
|
)
|
|
$
|
(18
|
)
|
|
$
|
40
|
|
|
$
|
(29
|
)
|
|
$
|
(47
|
)
|
|
$
|
(38
|
)
|
|
$
|
18
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
Service cost
|
$
|
2
|
|
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
4
|
|
Interest cost
|
11
|
|
|
11
|
|
|
23
|
|
|
22
|
|
||||
Expected return on plan assets
|
(14
|
)
|
|
(13
|
)
|
|
(27
|
)
|
|
(25
|
)
|
||||
Amortization of prior service costs/(credits)
|
(76
|
)
|
|
(78
|
)
|
|
(153
|
)
|
|
(156
|
)
|
||||
Amortization of unrecognized losses/(gains)
|
(2
|
)
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
||||
Net postretirement cost/(benefit)
|
$
|
(79
|
)
|
|
$
|
(78
|
)
|
|
$
|
(158
|
)
|
|
$
|
(155
|
)
|
|
Notional Amount
|
||||||
|
June 29, 2019
|
|
December 29, 2018
|
||||
Commodity contracts
|
$
|
610
|
|
|
$
|
478
|
|
Foreign exchange contracts
|
2,847
|
|
|
3,263
|
|
||
Cross-currency contracts
|
10,146
|
|
|
10,146
|
|
|
June 29, 2019
|
||||||||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets and Liabilities
(Level 1) |
|
Significant Other Observable Inputs
(Level 2) |
|
Total Fair Value
|
||||||||||||||||||
|
Assets
|
|
Liabilities
|
|
Assets
|
|
Liabilities
|
|
Assets
|
|
Liabilities
|
||||||||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange contracts(a)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
16
|
|
|
$
|
20
|
|
|
$
|
16
|
|
|
$
|
20
|
|
Cross-currency contracts(b)
|
—
|
|
|
—
|
|
|
196
|
|
|
64
|
|
|
196
|
|
|
64
|
|
||||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commodity contracts(c)
|
27
|
|
|
11
|
|
|
2
|
|
|
2
|
|
|
29
|
|
|
13
|
|
||||||
Foreign exchange contracts(a)
|
—
|
|
|
—
|
|
|
7
|
|
|
14
|
|
|
7
|
|
|
14
|
|
||||||
Cross-currency contracts(b)
|
—
|
|
|
—
|
|
|
512
|
|
|
66
|
|
|
512
|
|
|
66
|
|
||||||
Total fair value
|
$
|
27
|
|
|
$
|
11
|
|
|
$
|
733
|
|
|
$
|
166
|
|
|
$
|
760
|
|
|
$
|
177
|
|
(a)
|
At June 29, 2019, the fair value of our derivative assets was recorded in other current assets ($19 million) and other non-current assets ($4 million) the fair value of our derivative liabilities was recorded in other current liabilities ($30 million) and other non-current liabilities ($4 million).
|
(b)
|
At June 29, 2019, the fair value of our derivative assets was recorded in other current assets ($512 million) and other non-current assets ($196 million), and the fair value of our derivative liabilities was recorded in other current liabilities ($66 million) and other non-current liabilities ($64 million).
|
(c)
|
At June 29, 2019, the fair value of our derivative assets was recorded in other current assets ($27 million) and other non-current assets ($2 million) and the fair value of derivative liabilities was recorded in other current liabilities.
|
|
December 29, 2018
|
||||||||||||||||||||||
|
Quoted Prices in Active Markets for Identical Assets and Liabilities
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Total Fair Value
|
||||||||||||||||||
|
Assets
|
|
Liabilities
|
|
Assets
|
|
Liabilities
|
|
Assets
|
|
Liabilities
|
||||||||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange contracts(a)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
51
|
|
|
$
|
26
|
|
|
$
|
51
|
|
|
$
|
26
|
|
Cross-currency contracts(b)
|
—
|
|
|
—
|
|
|
139
|
|
|
3
|
|
|
139
|
|
|
3
|
|
||||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commodity contracts(a)
|
5
|
|
|
27
|
|
|
—
|
|
|
2
|
|
|
5
|
|
|
29
|
|
||||||
Foreign exchange contracts(a)
|
—
|
|
|
—
|
|
|
5
|
|
|
42
|
|
|
5
|
|
|
42
|
|
||||||
Cross-currency contracts(b)
|
—
|
|
|
—
|
|
|
557
|
|
|
119
|
|
|
557
|
|
|
119
|
|
||||||
Total fair value
|
$
|
5
|
|
|
$
|
27
|
|
|
$
|
752
|
|
|
$
|
192
|
|
|
$
|
757
|
|
|
$
|
219
|
|
(a)
|
The fair value of derivative assets was recorded in other current assets and the fair value of derivative liabilities was recorded in other current liabilities.
|
(b)
|
The fair value of derivative assets was recorded in other current assets ($557 million) and other non-current assets ($139 million), and the fair value of derivative liabilities was recorded within other current liabilities ($119 million) and other non-current liabilities ($3 million).
|
•
|
Non-derivative foreign denominated debt with principal amounts of €2,550 million and £400 million;
|
•
|
Cross-currency contracts with notional amounts of £1.0 billion ($1.4 billion), C$2.1 billion ($1.6 billion), and ¥9.6 billion ($85 million); and
|
•
|
Foreign exchange contracts denominated in Chinese renminbi with an aggregate notional amount of $167 million.
|
Accumulated Other Comprehensive Income/(Losses) Component
|
|
Gains/(Losses) Recognized in Other Comprehensive Income/(Losses) Related to Derivatives Designated as Hedging Instruments
|
|
Location of Gains/(Losses) When Reclassified to Net Income/(Loss)
|
||||||||||||||
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
|
|
||||||||||||
|
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
|
|
||||||||
Cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
Net sales
|
Foreign exchange contracts
|
|
(8
|
)
|
|
25
|
|
|
(27
|
)
|
|
32
|
|
|
Cost of products sold
|
||||
Foreign exchange contracts (excluded component)
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Cost of products sold
|
||||
Foreign exchange contracts
|
|
—
|
|
|
13
|
|
|
(22
|
)
|
|
31
|
|
|
Other expense/(income)
|
||||
Cross-currency contracts
|
|
(5
|
)
|
|
—
|
|
|
19
|
|
|
—
|
|
|
Other expense/(income)
|
||||
Cross-currency contracts (excluded component)
|
|
7
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
Other expense/(income)
|
||||
Net investment hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
|
4
|
|
|
13
|
|
|
13
|
|
|
2
|
|
|
SG&A
|
||||
Foreign exchange contracts (excluded component)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
Interest expense
|
||||
Cross-currency contracts
|
|
34
|
|
|
107
|
|
|
(38
|
)
|
|
96
|
|
|
SG&A
|
||||
Cross-currency contracts (excluded component)
|
|
7
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
Interest expense
|
||||
Total gains/(losses) recognized in statements of comprehensive income
|
|
$
|
40
|
|
|
$
|
158
|
|
|
$
|
(29
|
)
|
|
$
|
161
|
|
|
|
|
For the Three Months Ended
|
||||||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
||||||||||||||||||||
|
|
|
(As Restated)
|
||||||||||||||||||||
|
Cost of products sold
|
|
Interest expense
|
|
Other expense/ (income)
|
|
Cost of products sold
|
|
Interest expense
|
|
Other expense/ (income)
|
||||||||||||
Total amounts presented in the consolidated statements of income in which the following effects were recorded
|
$
|
4,324
|
|
|
$
|
316
|
|
|
$
|
(133
|
)
|
|
$
|
4,343
|
|
|
$
|
316
|
|
|
$
|
(20
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gains/(losses) related to derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange contracts
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
$
|
13
|
|
Foreign exchange contracts (excluded component)
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Interest rate contracts
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||||
Cross-currency contracts
|
—
|
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cross-currency contracts (excluded component)
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net investment hedges:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange contracts
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Foreign exchange contracts (excluded component)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cross-currency contracts (excluded component)
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Gains/(losses) related to derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commodity contracts
|
5
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
|
—
|
|
||||||
Foreign exchange contracts
|
—
|
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|
—
|
|
|
(64
|
)
|
||||||
Cross-currency contracts
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total gains/(losses) recognized in statements of income
|
$
|
12
|
|
|
$
|
6
|
|
|
$
|
(18
|
)
|
|
$
|
(14
|
)
|
|
$
|
(1
|
)
|
|
$
|
(51
|
)
|
|
For the Six Months Ended
|
||||||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
||||||||||||||||||||
|
|
|
(As Restated)
|
||||||||||||||||||||
|
Cost of products sold
|
|
Interest expense
|
|
Other expense/ (income)
|
|
Cost of products sold
|
|
Interest expense
|
|
Other expense/ (income)
|
||||||||||||
Total amounts presented in the consolidated statements of income in which the following effects were recorded
|
$
|
8,272
|
|
|
$
|
637
|
|
|
$
|
(513
|
)
|
|
$
|
8,383
|
|
|
$
|
633
|
|
|
$
|
(110
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gains/(losses) related to derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange contracts
|
$
|
17
|
|
|
$
|
—
|
|
|
$
|
(22
|
)
|
|
$
|
(9
|
)
|
|
$
|
—
|
|
|
$
|
31
|
|
Foreign exchange contracts (excluded component)
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Interest rate contracts
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
||||||
Cross-currency contracts
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cross-currency contracts (excluded component)
|
—
|
|
|
—
|
|
|
14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net investment hedges:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange contracts
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Foreign exchange contracts (excluded component)
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Cross-currency contracts (excluded component)
|
—
|
|
|
14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Gains/(losses) related to derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commodity contracts
|
26
|
|
|
—
|
|
|
—
|
|
|
(15
|
)
|
|
—
|
|
|
—
|
|
||||||
Foreign exchange contracts
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
(44
|
)
|
||||||
Cross-currency contracts
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||||
Total gains/(losses) recognized in statements of income
|
$
|
41
|
|
|
$
|
11
|
|
|
$
|
(7
|
)
|
|
$
|
(24
|
)
|
|
$
|
(2
|
)
|
|
$
|
(14
|
)
|
|
Foreign Currency Translation Adjustments
|
|
Net Postemployment Benefit Plan Adjustments
|
|
Net Cash Flow Hedge Adjustments
|
|
Total
|
||||||||
Balance as of December 29, 2018
|
$
|
(2,476
|
)
|
|
$
|
492
|
|
|
$
|
41
|
|
|
$
|
(1,943
|
)
|
Foreign currency translation adjustments
|
138
|
|
|
—
|
|
|
—
|
|
|
138
|
|
||||
Net deferred gains/(losses) on net investment hedges
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
||||
Amounts excluded from the effectiveness assessment of net investment hedges
|
10
|
|
|
—
|
|
|
—
|
|
|
10
|
|
||||
Net deferred losses/(gains) on net investment hedges reclassified to net income/(loss)
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
||||
Net deferred gains/(losses) on cash flow hedges
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
(26
|
)
|
||||
Amounts excluded from the effectiveness assessment of cash flow hedges
|
—
|
|
|
—
|
|
|
13
|
|
|
13
|
|
||||
Net deferred losses/(gains) on cash flow hedges reclassified to net income/(loss)
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
(5
|
)
|
||||
Net postemployment benefit gains/(losses) arising during the period
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
||||
Net postemployment benefit losses/(gains) reclassified to net income/(loss)
|
—
|
|
|
(117
|
)
|
|
—
|
|
|
(117
|
)
|
||||
Cumulative effect of accounting standards adopted in the period(a)
|
—
|
|
|
114
|
|
|
22
|
|
|
136
|
|
||||
Total other comprehensive income/(loss)
|
140
|
|
|
(8
|
)
|
|
4
|
|
|
136
|
|
||||
Balance as of June 29, 2019
|
$
|
(2,336
|
)
|
|
$
|
484
|
|
|
$
|
45
|
|
|
$
|
(1,807
|
)
|
(a)
|
In the first quarter of 2019, we adopted ASU 2018-02 related to reclassifying tax effects stranded in accumulated other comprehensive income/(losses). See Note 4, New Accounting Standards, for additional information.
|
|
For the Three Months Ended
|
||||||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
||||||||||||||||||||
|
|
|
(As Restated)
|
||||||||||||||||||||
|
Before Tax Amount
|
|
Tax
|
|
Net of Tax Amount
|
|
Before Tax Amount
|
|
Tax
|
|
Net of Tax Amount
|
||||||||||||
Foreign currency translation adjustments
|
$
|
(69
|
)
|
|
$
|
—
|
|
|
$
|
(69
|
)
|
|
$
|
(856
|
)
|
|
$
|
—
|
|
|
$
|
(856
|
)
|
Net deferred gains/(losses) on net investment hedges
|
13
|
|
|
(3
|
)
|
|
10
|
|
|
315
|
|
|
(96
|
)
|
|
219
|
|
||||||
Amounts excluded from the effectiveness assessment of net investment hedges
|
7
|
|
|
(1
|
)
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net deferred losses/(gains) on net investment hedges reclassified to net income/(loss)
|
(7
|
)
|
|
1
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net deferred gains/(losses) on cash flow hedges
|
(13
|
)
|
|
3
|
|
|
(10
|
)
|
|
38
|
|
|
(4
|
)
|
|
34
|
|
||||||
Amounts excluded from the effectiveness assessment of cash flow hedges
|
8
|
|
|
(1
|
)
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net deferred losses/(gains) on cash flow hedges reclassified to net income/(loss)
|
1
|
|
|
2
|
|
|
3
|
|
|
(8
|
)
|
|
(1
|
)
|
|
(9
|
)
|
||||||
Net actuarial gains/(losses) arising during the period
|
—
|
|
|
(5
|
)
|
|
(5
|
)
|
|
71
|
|
|
(18
|
)
|
|
53
|
|
||||||
Net postemployment benefit losses/(gains) reclassified to net income/(loss)
|
(78
|
)
|
|
19
|
|
|
(59
|
)
|
|
(22
|
)
|
|
5
|
|
|
(17
|
)
|
|
For the Six Months Ended
|
||||||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
||||||||||||||||||||
|
|
|
(As Restated)
|
||||||||||||||||||||
|
Before Tax Amount
|
|
Tax
|
|
Net of Tax Amount
|
|
Before Tax Amount
|
|
Tax
|
|
Net of Tax Amount
|
||||||||||||
Foreign currency translation adjustments
|
$
|
138
|
|
|
$
|
—
|
|
|
$
|
138
|
|
|
$
|
(654
|
)
|
|
$
|
—
|
|
|
$
|
(654
|
)
|
Net deferred gains/(losses) on net investment hedges
|
(6
|
)
|
|
2
|
|
|
(4
|
)
|
|
190
|
|
|
(45
|
)
|
|
145
|
|
||||||
Amounts excluded from the effectiveness assessment of net investment hedges
|
13
|
|
|
(3
|
)
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net deferred losses/(gains) on net investment hedges reclassified to net income/(loss)
|
(7
|
)
|
|
3
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net deferred gains/(losses) on cash flow hedges
|
(31
|
)
|
|
5
|
|
|
(26
|
)
|
|
63
|
|
|
(7
|
)
|
|
56
|
|
||||||
Amounts excluded from the effectiveness assessment of cash flow hedges
|
14
|
|
|
(1
|
)
|
|
13
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net deferred losses/(gains) on cash flow hedges reclassified to net income/(loss)
|
(11
|
)
|
|
6
|
|
|
(5
|
)
|
|
(20
|
)
|
|
(2
|
)
|
|
(22
|
)
|
||||||
Net actuarial gains/(losses) arising during the period
|
(1
|
)
|
|
(4
|
)
|
|
(5
|
)
|
|
71
|
|
|
(18
|
)
|
|
53
|
|
||||||
Net postemployment benefit losses/(gains) reclassified to net income/(loss)
|
(156
|
)
|
|
39
|
|
|
(117
|
)
|
|
(99
|
)
|
|
24
|
|
|
(75
|
)
|
Accumulated Other Comprehensive Income/(Losses) Component
|
|
Reclassified from Accumulated Other Comprehensive Income/(Losses) to Net Income/(Loss)
|
|
Affected Line Item in the Statements of Income
|
||||||||||||||
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
|
|
||||||||||||
|
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
|
|
||||||||
Losses/(gains) on net investment hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts(a)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
Other expense/(income)
|
Foreign exchange contracts(a)
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
Interest expense
|
||||
Cross-currency contracts(a)
|
|
(7
|
)
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|
Interest expense
|
||||
Losses/(gains) on cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts(b)
|
|
(7
|
)
|
|
4
|
|
|
(15
|
)
|
|
9
|
|
|
Cost of products sold
|
||||
Foreign exchange contracts(b)
|
|
—
|
|
|
(13
|
)
|
|
22
|
|
|
(31
|
)
|
|
Other expense/(income)
|
||||
Cross-currency contracts(a)
|
|
7
|
|
|
—
|
|
|
(20
|
)
|
|
—
|
|
|
Other expense/(income)
|
||||
Interest rate contracts(c)
|
|
1
|
|
|
1
|
|
|
2
|
|
|
2
|
|
|
Interest expense
|
||||
Losses/(gains) on hedges before income taxes
|
|
(6
|
)
|
|
(8
|
)
|
|
(18
|
)
|
|
(20
|
)
|
|
|
||||
Losses/(gains) on hedges, income taxes
|
|
3
|
|
|
(1
|
)
|
|
9
|
|
|
(2
|
)
|
|
|
||||
Losses/(gains) on hedges
|
|
$
|
(3
|
)
|
|
$
|
(9
|
)
|
|
$
|
(9
|
)
|
|
$
|
(22
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Losses/(gains) on postemployment benefits:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of unrecognized losses/(gains)
|
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
$
|
(4
|
)
|
|
$
|
1
|
|
|
(d)
|
Amortization of prior service costs/(credits)
|
|
(76
|
)
|
|
(78
|
)
|
|
(153
|
)
|
|
(156
|
)
|
|
(d)
|
||||
Settlement and curtailment losses/(gains)
|
|
—
|
|
|
56
|
|
|
—
|
|
|
56
|
|
|
(d)
|
||||
Other losses/(gains) on postemployment benefits
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
|
||||
Losses/(gains) on postemployment benefits before income taxes
|
|
(78
|
)
|
|
(22
|
)
|
|
(156
|
)
|
|
(99
|
)
|
|
|
||||
Losses/(gains) on postemployment benefits, income taxes
|
|
19
|
|
|
5
|
|
|
39
|
|
|
24
|
|
|
|
||||
Losses/(gains) on postemployment benefits
|
|
$
|
(59
|
)
|
|
$
|
(17
|
)
|
|
$
|
(117
|
)
|
|
$
|
(75
|
)
|
|
|
(a)
|
Represents recognition of the excluded component in net income/(loss).
|
(b)
|
Includes amortization of the excluded component and the effective portion of the related hedges.
|
(c)
|
Represents amortization of realized hedge losses that were deferred into accumulated other comprehensive income/(losses) through the maturity of the related long-term debt instruments.
|
(d)
|
These components are included in the computation of net periodic postemployment benefit costs. See Note 12, Postemployment Benefits, for additional information.
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||
|
June 29, 2019
|
||||||
Operating lease costs
|
$
|
48
|
|
|
$
|
96
|
|
Finance lease costs:
|
|
|
|
||||
Amortization of right-of-use assets
|
7
|
|
|
13
|
|
||
Interest on lease liabilities
|
2
|
|
|
3
|
|
||
Short-term lease costs
|
3
|
|
|
6
|
|
||
Variable lease costs
|
308
|
|
|
651
|
|
||
Sublease income
|
(4
|
)
|
|
(7
|
)
|
||
Total lease costs
|
$
|
364
|
|
|
$
|
762
|
|
|
June 29, 2019
|
||||||
|
Operating
Leases |
|
Finance
Leases |
||||
Right-of-use assets
|
$
|
574
|
|
|
$
|
185
|
|
Lease liabilities (current)
|
158
|
|
|
27
|
|
||
Lease liabilities (non-current)
|
477
|
|
|
161
|
|
||
|
|
|
|
||||
Weighted average remaining lease term
|
6 years
|
|
|
10 years
|
|
||
Weighted average discount rate
|
4.1
|
%
|
|
3.3
|
%
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||
|
June 29, 2019
|
||||||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
|
||||
Operating cash inflows/(outflows) from operating leases
|
$
|
(50
|
)
|
|
$
|
(98
|
)
|
Operating cash inflows/(outflows) from finance leases
|
(1
|
)
|
|
(3
|
)
|
||
Financing cash inflows/(outflows) from finance leases
|
(6
|
)
|
|
(13
|
)
|
||
Right-of-use assets obtained in exchange for lease liabilities:
|
|
|
|
||||
Operating leases
|
11
|
|
|
27
|
|
||
Finance leases
|
—
|
|
|
—
|
|
|
Operating
Leases |
|
Finance
Leases |
||||
2019 (excluding the six months ended June 29, 2019)
|
$
|
97
|
|
|
$
|
17
|
|
2020
|
159
|
|
|
30
|
|
||
2021
|
122
|
|
|
70
|
|
||
2022
|
89
|
|
|
20
|
|
||
2023
|
62
|
|
|
8
|
|
||
Thereafter
|
195
|
|
|
85
|
|
||
Total future undiscounted lease payments
|
724
|
|
|
230
|
|
||
Less imputed interest
|
(89
|
)
|
|
(42
|
)
|
||
Total lease liability
|
$
|
635
|
|
|
$
|
188
|
|
2019
|
$
|
185
|
|
2020
|
137
|
|
|
2021
|
105
|
|
|
2022
|
70
|
|
|
2023
|
49
|
|
|
Thereafter
|
148
|
|
|
Total
|
$
|
694
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
|
|
|
(As Restated)
|
|
|
|
(As Restated)
|
||||||||
|
(in millions, except per share data)
|
||||||||||||||
Basic Earnings Per Common Share:
|
|
|
|
|
|
|
|
||||||||
Net income/(loss) attributable to common shareholders
|
$
|
449
|
|
|
$
|
754
|
|
|
$
|
854
|
|
|
$
|
1,757
|
|
Weighted average shares of common stock outstanding
|
1,220
|
|
|
1,219
|
|
|
1,220
|
|
|
1,219
|
|
||||
Net earnings/(loss)
|
$
|
0.37
|
|
|
$
|
0.62
|
|
|
$
|
0.70
|
|
|
$
|
1.44
|
|
Diluted Earnings Per Common Share:
|
|
|
|
|
|
|
|
||||||||
Net income/(loss) attributable to common shareholders
|
$
|
449
|
|
|
$
|
754
|
|
|
$
|
854
|
|
|
$
|
1,757
|
|
Weighted average shares of common stock outstanding
|
1,220
|
|
|
1,219
|
|
|
1,220
|
|
|
1,219
|
|
||||
Effect of dilutive equity awards
|
2
|
|
|
7
|
|
|
3
|
|
|
8
|
|
||||
Weighted average shares of common stock outstanding, including dilutive effect
|
1,222
|
|
|
1,226
|
|
|
1,223
|
|
|
1,227
|
|
||||
Net earnings/(loss)
|
$
|
0.37
|
|
|
$
|
0.62
|
|
|
$
|
0.70
|
|
|
$
|
1.43
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
|
|
|
(As Restated)
|
|
|
|
(As Restated)
|
||||||||
Net sales:
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
4,511
|
|
|
$
|
4,513
|
|
|
$
|
8,713
|
|
|
$
|
8,881
|
|
Canada
|
560
|
|
|
564
|
|
|
1,010
|
|
|
1,048
|
|
||||
EMEA
|
643
|
|
|
707
|
|
|
1,250
|
|
|
1,392
|
|
||||
Rest of World
|
692
|
|
|
906
|
|
|
1,392
|
|
|
1,673
|
|
||||
Total net sales
|
$
|
6,406
|
|
|
$
|
6,690
|
|
|
$
|
12,365
|
|
|
$
|
12,994
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
|
|
|
(As Restated)
|
|
|
|
(As Restated)
|
||||||||
Segment Adjusted EBITDA:
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
1,251
|
|
|
$
|
1,401
|
|
|
$
|
2,384
|
|
|
$
|
2,793
|
|
Canada
|
143
|
|
|
173
|
|
|
264
|
|
|
307
|
|
||||
EMEA
|
171
|
|
|
206
|
|
|
314
|
|
|
388
|
|
||||
Rest of World
|
102
|
|
|
213
|
|
|
203
|
|
|
357
|
|
||||
General corporate expenses
|
(67
|
)
|
|
(44
|
)
|
|
(134
|
)
|
|
(89
|
)
|
||||
Depreciation and amortization (excluding integration and restructuring expenses)
|
(253
|
)
|
|
(235
|
)
|
|
(487
|
)
|
|
(434
|
)
|
||||
Integration and restructuring expenses
|
(14
|
)
|
|
(93
|
)
|
|
(41
|
)
|
|
(183
|
)
|
||||
Deal costs
|
(5
|
)
|
|
(7
|
)
|
|
(13
|
)
|
|
(16
|
)
|
||||
Unrealized gains/(losses) on commodity hedges
|
10
|
|
|
(3
|
)
|
|
39
|
|
|
(5
|
)
|
||||
Impairment losses
|
(598
|
)
|
|
(234
|
)
|
|
(1,218
|
)
|
|
(234
|
)
|
||||
Equity award compensation expense (excluding integration and restructuring expenses)
|
(6
|
)
|
|
(20
|
)
|
|
(15
|
)
|
|
(27
|
)
|
||||
Operating income/(loss)
|
734
|
|
|
1,357
|
|
|
1,296
|
|
|
2,857
|
|
||||
Interest expense
|
316
|
|
|
316
|
|
|
637
|
|
|
633
|
|
||||
Other expense/(income)
|
(133
|
)
|
|
(20
|
)
|
|
(513
|
)
|
|
(110
|
)
|
||||
Income/(loss) before income taxes
|
$
|
551
|
|
|
$
|
1,061
|
|
|
$
|
1,172
|
|
|
$
|
2,334
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
|
|
|
(As Restated)
|
|
|
|
(As Restated)
|
||||||||
Condiments and sauces
|
$
|
1,726
|
|
|
$
|
1,892
|
|
|
$
|
3,239
|
|
|
$
|
3,484
|
|
Cheese and dairy
|
1,254
|
|
|
1,246
|
|
|
2,448
|
|
|
2,491
|
|
||||
Ambient foods
|
561
|
|
|
594
|
|
|
1,159
|
|
|
1,254
|
|
||||
Frozen and chilled foods
|
599
|
|
|
613
|
|
|
1,204
|
|
|
1,215
|
|
||||
Meats and seafood
|
653
|
|
|
647
|
|
|
1,240
|
|
|
1,248
|
|
||||
Refreshment beverages
|
436
|
|
|
435
|
|
|
793
|
|
|
810
|
|
||||
Coffee
|
328
|
|
|
341
|
|
|
636
|
|
|
699
|
|
||||
Infant and nutrition
|
138
|
|
|
225
|
|
|
267
|
|
|
424
|
|
||||
Desserts, toppings and baking
|
253
|
|
|
254
|
|
|
447
|
|
|
470
|
|
||||
Nuts and salted snacks
|
229
|
|
|
226
|
|
|
454
|
|
|
421
|
|
||||
Other
|
229
|
|
|
217
|
|
|
478
|
|
|
478
|
|
||||
Total net sales
|
$
|
6,406
|
|
|
$
|
6,690
|
|
|
$
|
12,365
|
|
|
$
|
12,994
|
|
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
4,276
|
|
|
$
|
2,248
|
|
|
$
|
(118
|
)
|
|
$
|
6,406
|
|
Cost of products sold
|
—
|
|
|
2,816
|
|
|
1,626
|
|
|
(118
|
)
|
|
4,324
|
|
|||||
Gross profit
|
—
|
|
|
1,460
|
|
|
622
|
|
|
—
|
|
|
2,082
|
|
|||||
Selling, general and administrative expenses, excluding impairment losses
|
—
|
|
|
193
|
|
|
557
|
|
|
—
|
|
|
750
|
|
|||||
Goodwill impairment losses
|
—
|
|
|
—
|
|
|
124
|
|
|
—
|
|
|
124
|
|
|||||
Intangible asset impairment losses
|
—
|
|
|
—
|
|
|
474
|
|
|
—
|
|
|
474
|
|
|||||
Selling, general and administrative expenses
|
—
|
|
|
193
|
|
|
1,155
|
|
|
—
|
|
|
1,348
|
|
|||||
Intercompany service fees and other recharges
|
—
|
|
|
899
|
|
|
(899
|
)
|
|
—
|
|
|
—
|
|
|||||
Operating income/(loss)
|
—
|
|
|
368
|
|
|
366
|
|
|
—
|
|
|
734
|
|
|||||
Interest expense
|
—
|
|
|
298
|
|
|
18
|
|
|
—
|
|
|
316
|
|
|||||
Other expense/(income)
|
—
|
|
|
(73
|
)
|
|
(60
|
)
|
|
—
|
|
|
(133
|
)
|
|||||
Income/(loss) before income taxes
|
—
|
|
|
143
|
|
|
408
|
|
|
—
|
|
|
551
|
|
|||||
Provision for/(benefit from) income taxes
|
—
|
|
|
35
|
|
|
68
|
|
|
—
|
|
|
103
|
|
|||||
Equity in earnings/(losses) of subsidiaries
|
448
|
|
|
341
|
|
|
—
|
|
|
(789
|
)
|
|
—
|
|
|||||
Net income/(loss)
|
448
|
|
|
449
|
|
|
340
|
|
|
(789
|
)
|
|
448
|
|
|||||
Net income/(loss) attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||
Net income/(loss) excluding noncontrolling interest
|
$
|
448
|
|
|
$
|
449
|
|
|
$
|
341
|
|
|
$
|
(789
|
)
|
|
$
|
449
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Comprehensive income/(loss) excluding noncontrolling interest
|
$
|
326
|
|
|
$
|
326
|
|
|
$
|
939
|
|
|
$
|
(1,265
|
)
|
|
$
|
326
|
|
|
As Restated
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
4,298
|
|
|
$
|
2,533
|
|
|
$
|
(141
|
)
|
|
$
|
6,690
|
|
Cost of products sold
|
—
|
|
|
2,766
|
|
|
1,718
|
|
|
(141
|
)
|
|
4,343
|
|
|||||
Gross profit
|
—
|
|
|
1,532
|
|
|
815
|
|
|
—
|
|
|
2,347
|
|
|||||
Selling, general and administrative expenses, excluding impairment losses
|
—
|
|
|
200
|
|
|
556
|
|
|
—
|
|
|
756
|
|
|||||
Goodwill impairment losses
|
—
|
|
|
—
|
|
|
133
|
|
|
—
|
|
|
133
|
|
|||||
Intangible asset impairment losses
|
—
|
|
|
—
|
|
|
101
|
|
|
—
|
|
|
101
|
|
|||||
Selling, general and administrative expenses
|
—
|
|
|
200
|
|
|
790
|
|
|
—
|
|
|
990
|
|
|||||
Intercompany service fees and other recharges
|
—
|
|
|
1,124
|
|
|
(1,124
|
)
|
|
—
|
|
|
—
|
|
|||||
Operating income/(loss)
|
—
|
|
|
208
|
|
|
1,149
|
|
|
—
|
|
|
1,357
|
|
|||||
Interest expense
|
—
|
|
|
301
|
|
|
15
|
|
|
—
|
|
|
316
|
|
|||||
Other expense/(income)
|
—
|
|
|
(18
|
)
|
|
(2
|
)
|
|
—
|
|
|
(20
|
)
|
|||||
Income/(loss) before income taxes
|
—
|
|
|
(75
|
)
|
|
1,136
|
|
|
—
|
|
|
1,061
|
|
|||||
Provision for/(benefit from) income taxes
|
—
|
|
|
37
|
|
|
271
|
|
|
—
|
|
|
308
|
|
|||||
Equity in earnings/(losses) of subsidiaries
|
754
|
|
|
867
|
|
|
—
|
|
|
(1,621
|
)
|
|
—
|
|
|||||
Net income/(loss)
|
754
|
|
|
755
|
|
|
865
|
|
|
(1,621
|
)
|
|
753
|
|
|||||
Net income/(loss) attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||
Net income/(loss) excluding noncontrolling interest
|
$
|
754
|
|
|
$
|
755
|
|
|
$
|
866
|
|
|
$
|
(1,621
|
)
|
|
$
|
754
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Comprehensive income/(loss) excluding noncontrolling interest
|
$
|
178
|
|
|
$
|
178
|
|
|
$
|
23
|
|
|
$
|
(201
|
)
|
|
$
|
178
|
|
|
As Previously Reported
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
4,298
|
|
|
$
|
2,531
|
|
|
$
|
(143
|
)
|
|
$
|
6,686
|
|
Cost of products sold
|
—
|
|
|
2,742
|
|
|
1,722
|
|
|
(143
|
)
|
|
4,321
|
|
|||||
Gross profit
|
—
|
|
|
1,556
|
|
|
809
|
|
|
—
|
|
|
2,365
|
|
|||||
Selling, general and administrative expenses, excluding impairment losses
|
—
|
|
|
201
|
|
|
570
|
|
|
—
|
|
|
771
|
|
|||||
Goodwill impairment losses
|
—
|
|
|
—
|
|
|
164
|
|
|
—
|
|
|
164
|
|
|||||
Intangible asset impairment losses
|
—
|
|
|
—
|
|
|
101
|
|
|
—
|
|
|
101
|
|
|||||
Selling, general and administrative expenses
|
—
|
|
|
201
|
|
|
835
|
|
|
—
|
|
|
1,036
|
|
|||||
Intercompany service fees and other recharges
|
—
|
|
|
1,123
|
|
|
(1,123
|
)
|
|
—
|
|
|
—
|
|
|||||
Operating income/(loss)
|
—
|
|
|
232
|
|
|
1,097
|
|
|
—
|
|
|
1,329
|
|
|||||
Interest expense
|
—
|
|
|
302
|
|
|
16
|
|
|
—
|
|
|
318
|
|
|||||
Other expense/(income)
|
—
|
|
|
(16
|
)
|
|
(19
|
)
|
|
—
|
|
|
(35
|
)
|
|||||
Income/(loss) before income taxes
|
—
|
|
|
(54
|
)
|
|
1,100
|
|
|
—
|
|
|
1,046
|
|
|||||
Provision for/(benefit from) income taxes
|
—
|
|
|
43
|
|
|
248
|
|
|
—
|
|
|
291
|
|
|||||
Equity in earnings/(losses) of subsidiaries
|
756
|
|
|
853
|
|
|
—
|
|
|
(1,609
|
)
|
|
—
|
|
|||||
Net income/(loss)
|
756
|
|
|
756
|
|
|
852
|
|
|
(1,609
|
)
|
|
755
|
|
|||||
Net income/(loss) attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||
Net income/(loss) excluding noncontrolling interest
|
$
|
756
|
|
|
$
|
756
|
|
|
$
|
853
|
|
|
$
|
(1,609
|
)
|
|
$
|
756
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|||||||||
Comprehensive income/(loss) excluding noncontrolling interest
|
$
|
174
|
|
|
$
|
174
|
|
|
$
|
—
|
|
|
$
|
(174
|
)
|
|
$
|
174
|
|
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
8,280
|
|
|
$
|
4,314
|
|
|
$
|
(229
|
)
|
|
$
|
12,365
|
|
Cost of products sold
|
—
|
|
|
5,388
|
|
|
3,113
|
|
|
(229
|
)
|
|
8,272
|
|
|||||
Gross profit
|
—
|
|
|
2,892
|
|
|
1,201
|
|
|
—
|
|
|
4,093
|
|
|||||
Selling, general and administrative expenses, excluding impairment losses
|
—
|
|
|
414
|
|
|
1,165
|
|
|
—
|
|
|
1,579
|
|
|||||
Goodwill impairment losses
|
—
|
|
|
—
|
|
|
744
|
|
|
—
|
|
|
744
|
|
|||||
Intangible asset impairment losses
|
—
|
|
|
—
|
|
|
474
|
|
|
—
|
|
|
474
|
|
|||||
Selling, general and administrative expenses
|
—
|
|
|
414
|
|
|
2,383
|
|
|
—
|
|
|
2,797
|
|
|||||
Intercompany service fees and other recharges
|
—
|
|
|
1,740
|
|
|
(1,740
|
)
|
|
—
|
|
|
—
|
|
|||||
Operating income/(loss)
|
—
|
|
|
738
|
|
|
558
|
|
|
—
|
|
|
1,296
|
|
|||||
Interest expense
|
—
|
|
|
598
|
|
|
39
|
|
|
—
|
|
|
637
|
|
|||||
Other expense/(income)
|
—
|
|
|
(65
|
)
|
|
(448
|
)
|
|
—
|
|
|
(513
|
)
|
|||||
Income/(loss) before income taxes
|
—
|
|
|
205
|
|
|
967
|
|
|
—
|
|
|
1,172
|
|
|||||
Provision for/(benefit from) income taxes
|
—
|
|
|
71
|
|
|
249
|
|
|
—
|
|
|
320
|
|
|||||
Equity in earnings/(losses) of subsidiaries
|
854
|
|
|
720
|
|
|
—
|
|
|
(1,574
|
)
|
|
—
|
|
|||||
Net income/(loss)
|
854
|
|
|
854
|
|
|
718
|
|
|
(1,574
|
)
|
|
852
|
|
|||||
Net income/(loss) attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|||||
Net income/(loss) excluding noncontrolling interest
|
$
|
854
|
|
|
$
|
854
|
|
|
$
|
720
|
|
|
$
|
(1,574
|
)
|
|
$
|
854
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Comprehensive income/(loss) excluding noncontrolling interest
|
$
|
854
|
|
|
$
|
854
|
|
|
$
|
782
|
|
|
$
|
(1,636
|
)
|
|
$
|
854
|
|
|
As Restated
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
8,467
|
|
|
$
|
4,796
|
|
|
$
|
(269
|
)
|
|
$
|
12,994
|
|
Cost of products sold
|
—
|
|
|
5,338
|
|
|
3,314
|
|
|
(269
|
)
|
|
8,383
|
|
|||||
Gross profit
|
—
|
|
|
3,129
|
|
|
1,482
|
|
|
—
|
|
|
4,611
|
|
|||||
Selling, general and administrative expenses, excluding impairment losses
|
—
|
|
|
384
|
|
|
1,136
|
|
|
—
|
|
|
1,520
|
|
|||||
Goodwill impairment losses
|
—
|
|
|
—
|
|
|
133
|
|
|
—
|
|
|
133
|
|
|||||
Intangible asset impairment losses
|
—
|
|
|
—
|
|
|
101
|
|
|
—
|
|
|
101
|
|
|||||
Selling, general and administrative expenses
|
—
|
|
|
384
|
|
|
1,370
|
|
|
—
|
|
|
1,754
|
|
|||||
Intercompany service fees and other recharges
|
—
|
|
|
2,278
|
|
|
(2,278
|
)
|
|
—
|
|
|
—
|
|
|||||
Operating income/(loss)
|
—
|
|
|
467
|
|
|
2,390
|
|
|
—
|
|
|
2,857
|
|
|||||
Interest expense
|
—
|
|
|
598
|
|
|
35
|
|
|
—
|
|
|
633
|
|
|||||
Other expense/(income)
|
—
|
|
|
(176
|
)
|
|
66
|
|
|
—
|
|
|
(110
|
)
|
|||||
Income/(loss) before income taxes
|
—
|
|
|
45
|
|
|
2,289
|
|
|
—
|
|
|
2,334
|
|
|||||
Provision for/(benefit from) income taxes
|
—
|
|
|
18
|
|
|
560
|
|
|
—
|
|
|
578
|
|
|||||
Equity in earnings/(losses) of subsidiaries
|
1,757
|
|
|
1,731
|
|
|
—
|
|
|
(3,488
|
)
|
|
—
|
|
|||||
Net income/(loss)
|
1,757
|
|
|
1,758
|
|
|
1,729
|
|
|
(3,488
|
)
|
|
1,756
|
|
|||||
Net income/(loss) attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||
Net income/(loss) excluding noncontrolling interest
|
$
|
1,757
|
|
|
$
|
1,758
|
|
|
$
|
1,730
|
|
|
$
|
(3,488
|
)
|
|
$
|
1,757
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Comprehensive income/(loss) excluding noncontrolling interest
|
$
|
1,260
|
|
|
$
|
1,260
|
|
|
$
|
1,189
|
|
|
$
|
(2,449
|
)
|
|
$
|
1,260
|
|
|
As Previously Reported
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
8,467
|
|
|
$
|
4,793
|
|
|
$
|
(270
|
)
|
|
$
|
12,990
|
|
Cost of products sold
|
—
|
|
|
5,330
|
|
|
3,320
|
|
|
(270
|
)
|
|
8,380
|
|
|||||
Gross profit
|
—
|
|
|
3,137
|
|
|
1,473
|
|
|
—
|
|
|
4,610
|
|
|||||
Selling, general and administrative expenses, excluding impairment losses
|
—
|
|
|
384
|
|
|
1,151
|
|
|
—
|
|
|
1,535
|
|
|||||
Goodwill impairment losses
|
—
|
|
|
—
|
|
|
164
|
|
|
—
|
|
|
164
|
|
|||||
Intangible asset impairment losses
|
—
|
|
|
—
|
|
|
101
|
|
|
—
|
|
|
101
|
|
|||||
Selling, general and administrative expenses
|
—
|
|
|
384
|
|
|
1,416
|
|
|
—
|
|
|
1,800
|
|
|||||
Intercompany service fees and other recharges
|
—
|
|
|
2,278
|
|
|
(2,278
|
)
|
|
—
|
|
|
—
|
|
|||||
Operating income/(loss)
|
—
|
|
|
475
|
|
|
2,335
|
|
|
—
|
|
|
2,810
|
|
|||||
Interest expense
|
—
|
|
|
600
|
|
|
35
|
|
|
—
|
|
|
635
|
|
|||||
Other expense/(income)
|
—
|
|
|
(175
|
)
|
|
50
|
|
|
—
|
|
|
(125
|
)
|
|||||
Income/(loss) before income taxes
|
—
|
|
|
50
|
|
|
2,250
|
|
|
—
|
|
|
2,300
|
|
|||||
Provision for/(benefit from) income taxes
|
—
|
|
|
16
|
|
|
536
|
|
|
—
|
|
|
552
|
|
|||||
Equity in earnings/(losses) of subsidiaries
|
1,749
|
|
|
1,715
|
|
|
—
|
|
|
(3,464
|
)
|
|
—
|
|
|||||
Net income/(loss)
|
1,749
|
|
|
1,749
|
|
|
1,714
|
|
|
(3,464
|
)
|
|
1,748
|
|
|||||
Net income/(loss) attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||
Net income/(loss) excluding noncontrolling interest
|
$
|
1,749
|
|
|
$
|
1,749
|
|
|
$
|
1,715
|
|
|
$
|
(3,464
|
)
|
|
$
|
1,749
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|||||||||
Comprehensive income/(loss) excluding noncontrolling interest
|
$
|
1,246
|
|
|
$
|
1,246
|
|
|
$
|
1,165
|
|
|
$
|
(2,411
|
)
|
|
$
|
1,246
|
|
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
702
|
|
|
$
|
750
|
|
|
$
|
—
|
|
|
$
|
1,452
|
|
Trade receivables, net
|
—
|
|
|
933
|
|
|
1,116
|
|
|
—
|
|
|
2,049
|
|
|||||
Receivables due from affiliates
|
—
|
|
|
827
|
|
|
293
|
|
|
(1,120
|
)
|
|
—
|
|
|||||
Dividends due from affiliates
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Income taxes receivable
|
—
|
|
|
841
|
|
|
68
|
|
|
(804
|
)
|
|
105
|
|
|||||
Inventories
|
—
|
|
|
2,069
|
|
|
1,005
|
|
|
—
|
|
|
3,074
|
|
|||||
Short-term lending due from affiliates
|
—
|
|
|
1,243
|
|
|
3,856
|
|
|
(5,099
|
)
|
|
—
|
|
|||||
Prepaid expenses
|
—
|
|
|
199
|
|
|
196
|
|
|
—
|
|
|
395
|
|
|||||
Other current assets
|
—
|
|
|
663
|
|
|
395
|
|
|
—
|
|
|
1,058
|
|
|||||
Assets held for sale
|
—
|
|
|
75
|
|
|
960
|
|
|
—
|
|
|
1,035
|
|
|||||
Total current assets
|
—
|
|
|
7,552
|
|
|
8,639
|
|
|
(7,023
|
)
|
|
9,168
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
4,464
|
|
|
2,559
|
|
|
—
|
|
|
7,023
|
|
|||||
Goodwill
|
—
|
|
|
11,066
|
|
|
24,923
|
|
|
—
|
|
|
35,989
|
|
|||||
Investments in subsidiaries
|
51,543
|
|
|
67,112
|
|
|
—
|
|
|
(118,655
|
)
|
|
—
|
|
|||||
Intangible assets, net
|
—
|
|
|
2,929
|
|
|
46,014
|
|
|
—
|
|
|
48,943
|
|
|||||
Long-term lending due from affiliates
|
—
|
|
|
207
|
|
|
2,000
|
|
|
(2,207
|
)
|
|
—
|
|
|||||
Other non-current assets
|
—
|
|
|
806
|
|
|
1,272
|
|
|
—
|
|
|
2,078
|
|
|||||
TOTAL ASSETS
|
$
|
51,543
|
|
|
$
|
94,136
|
|
|
$
|
85,407
|
|
|
$
|
(127,885
|
)
|
|
$
|
103,201
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial paper and other short-term debt
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Current portion of long-term debt
|
—
|
|
|
1,291
|
|
|
7
|
|
|
—
|
|
|
1,298
|
|
|||||
Short-term lending due to affiliates
|
—
|
|
|
3,856
|
|
|
1,243
|
|
|
(5,099
|
)
|
|
—
|
|
|||||
Trade payables
|
—
|
|
|
2,567
|
|
|
1,586
|
|
|
—
|
|
|
4,153
|
|
|||||
Payables due to affiliates
|
—
|
|
|
293
|
|
|
827
|
|
|
(1,120
|
)
|
|
—
|
|
|||||
Accrued marketing
|
—
|
|
|
135
|
|
|
373
|
|
|
—
|
|
|
508
|
|
|||||
Interest payable
|
—
|
|
|
374
|
|
|
10
|
|
|
—
|
|
|
384
|
|
|||||
Dividends due to affiliates
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other current liabilities
|
—
|
|
|
368
|
|
|
1,481
|
|
|
(403
|
)
|
|
1,446
|
|
|||||
Liabilities held for sale
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
|||||
Total current liabilities
|
—
|
|
|
8,884
|
|
|
5,535
|
|
|
(6,622
|
)
|
|
7,797
|
|
|||||
Long-term debt
|
—
|
|
|
28,887
|
|
|
945
|
|
|
—
|
|
|
29,832
|
|
|||||
Long-term borrowings due to affiliates
|
—
|
|
|
2,578
|
|
|
30
|
|
|
(2,608
|
)
|
|
—
|
|
|||||
Deferred income taxes
|
—
|
|
|
1,340
|
|
|
10,788
|
|
|
—
|
|
|
12,128
|
|
|||||
Accrued postemployment costs
|
—
|
|
|
85
|
|
|
223
|
|
|
—
|
|
|
308
|
|
|||||
Other non-current liabilities
|
—
|
|
|
819
|
|
|
640
|
|
|
—
|
|
|
1,459
|
|
|||||
TOTAL LIABILITIES
|
—
|
|
|
42,593
|
|
|
18,161
|
|
|
(9,230
|
)
|
|
51,524
|
|
|||||
Redeemable noncontrolling interest
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||
Total shareholders’ equity
|
51,543
|
|
|
51,543
|
|
|
67,112
|
|
|
(118,655
|
)
|
|
51,543
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
132
|
|
|
—
|
|
|
132
|
|
|||||
TOTAL EQUITY
|
51,543
|
|
|
51,543
|
|
|
67,244
|
|
|
(118,655
|
)
|
|
51,675
|
|
|||||
TOTAL LIABILITIES AND EQUITY
|
$
|
51,543
|
|
|
$
|
94,136
|
|
|
$
|
85,407
|
|
|
$
|
(127,885
|
)
|
|
$
|
103,201
|
|
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
202
|
|
|
$
|
928
|
|
|
$
|
—
|
|
|
$
|
1,130
|
|
Trade receivables, net
|
—
|
|
|
933
|
|
|
1,196
|
|
|
—
|
|
|
2,129
|
|
|||||
Receivables due from affiliates
|
—
|
|
|
870
|
|
|
341
|
|
|
(1,211
|
)
|
|
—
|
|
|||||
Income taxes receivable
|
—
|
|
|
701
|
|
|
9
|
|
|
(558
|
)
|
|
152
|
|
|||||
Inventories
|
—
|
|
|
1,783
|
|
|
884
|
|
|
—
|
|
|
2,667
|
|
|||||
Short-term lending due from affiliates
|
—
|
|
|
1,787
|
|
|
3,753
|
|
|
(5,540
|
)
|
|
—
|
|
|||||
Prepaid expenses
|
—
|
|
|
198
|
|
|
202
|
|
|
—
|
|
|
400
|
|
|||||
Other current assets
|
—
|
|
|
776
|
|
|
445
|
|
|
—
|
|
|
1,221
|
|
|||||
Assets held for sale
|
—
|
|
|
75
|
|
|
1,301
|
|
|
—
|
|
|
1,376
|
|
|||||
Total current assets
|
—
|
|
|
7,325
|
|
|
9,059
|
|
|
(7,309
|
)
|
|
9,075
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
4,524
|
|
|
2,554
|
|
|
—
|
|
|
7,078
|
|
|||||
Goodwill
|
—
|
|
|
11,067
|
|
|
25,436
|
|
|
—
|
|
|
36,503
|
|
|||||
Investments in subsidiaries
|
51,657
|
|
|
67,867
|
|
|
—
|
|
|
(119,524
|
)
|
|
—
|
|
|||||
Intangible assets, net
|
—
|
|
|
3,010
|
|
|
46,458
|
|
|
—
|
|
|
49,468
|
|
|||||
Long-term lending due from affiliates
|
—
|
|
|
—
|
|
|
2,000
|
|
|
(2,000
|
)
|
|
—
|
|
|||||
Other non-current assets
|
—
|
|
|
316
|
|
|
1,021
|
|
|
—
|
|
|
1,337
|
|
|||||
TOTAL ASSETS
|
$
|
51,657
|
|
|
$
|
94,109
|
|
|
$
|
86,528
|
|
|
$
|
(128,833
|
)
|
|
$
|
103,461
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial paper and other short-term debt
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
21
|
|
|
$
|
—
|
|
|
$
|
21
|
|
Current portion of long-term debt
|
—
|
|
|
363
|
|
|
14
|
|
|
—
|
|
|
377
|
|
|||||
Short-term lending due to affiliates
|
—
|
|
|
3,753
|
|
|
1,787
|
|
|
(5,540
|
)
|
|
—
|
|
|||||
Trade payables
|
—
|
|
|
2,563
|
|
|
1,590
|
|
|
—
|
|
|
4,153
|
|
|||||
Payables due to affiliates
|
—
|
|
|
341
|
|
|
870
|
|
|
(1,211
|
)
|
|
—
|
|
|||||
Accrued marketing
|
—
|
|
|
282
|
|
|
440
|
|
|
—
|
|
|
722
|
|
|||||
Interest payable
|
—
|
|
|
394
|
|
|
14
|
|
|
—
|
|
|
408
|
|
|||||
Other current liabilities
|
—
|
|
|
888
|
|
|
1,437
|
|
|
(558
|
)
|
|
1,767
|
|
|||||
Liabilities held for sale
|
—
|
|
|
—
|
|
|
55
|
|
|
—
|
|
|
55
|
|
|||||
Total current liabilities
|
—
|
|
|
8,584
|
|
|
6,228
|
|
|
(7,309
|
)
|
|
7,503
|
|
|||||
Long-term debt
|
—
|
|
|
29,872
|
|
|
898
|
|
|
—
|
|
|
30,770
|
|
|||||
Long-term borrowings due to affiliates
|
—
|
|
|
2,000
|
|
|
12
|
|
|
(2,012
|
)
|
|
—
|
|
|||||
Deferred income taxes
|
—
|
|
|
1,314
|
|
|
10,888
|
|
|
—
|
|
|
12,202
|
|
|||||
Accrued postemployment costs
|
—
|
|
|
89
|
|
|
217
|
|
|
—
|
|
|
306
|
|
|||||
Other non-current liabilities
|
—
|
|
|
593
|
|
|
309
|
|
|
—
|
|
|
902
|
|
|||||
TOTAL LIABILITIES
|
—
|
|
|
42,452
|
|
|
18,552
|
|
|
(9,321
|
)
|
|
51,683
|
|
|||||
Redeemable noncontrolling interest
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
|||||
Total shareholders’ equity
|
51,657
|
|
|
51,657
|
|
|
67,855
|
|
|
(119,512
|
)
|
|
51,657
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
118
|
|
|
—
|
|
|
118
|
|
|||||
TOTAL EQUITY
|
51,657
|
|
|
51,657
|
|
|
67,973
|
|
|
(119,512
|
)
|
|
51,775
|
|
|||||
TOTAL LIABILITIES AND EQUITY
|
$
|
51,657
|
|
|
$
|
94,109
|
|
|
$
|
86,528
|
|
|
$
|
(128,833
|
)
|
|
$
|
103,461
|
|
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by/(used for) operating activities
|
$
|
976
|
|
|
$
|
1,510
|
|
|
$
|
(185
|
)
|
|
$
|
(976
|
)
|
|
$
|
1,325
|
|
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
—
|
|
|
(220
|
)
|
|
(228
|
)
|
|
—
|
|
|
(448
|
)
|
|||||
Payments to acquire business, net of cash acquired
|
—
|
|
|
(202
|
)
|
|
2
|
|
|
—
|
|
|
(200
|
)
|
|||||
Net proceeds from/(payments on) intercompany lending activities
|
—
|
|
|
444
|
|
|
22
|
|
|
(466
|
)
|
|
—
|
|
|||||
Additional investments in subsidiaries
|
—
|
|
|
(35
|
)
|
|
—
|
|
|
35
|
|
|
—
|
|
|||||
Return of capital
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Proceeds from sale of business, net of cash disposed
|
—
|
|
|
—
|
|
|
640
|
|
|
—
|
|
|
640
|
|
|||||
Other investing activities, net
|
—
|
|
|
10
|
|
|
(20
|
)
|
|
—
|
|
|
(10
|
)
|
|||||
Net cash provided by/(used for) investing activities
|
—
|
|
|
(3
|
)
|
|
416
|
|
|
(431
|
)
|
|
(18
|
)
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Repayments of long-term debt
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
|
—
|
|
|
(4
|
)
|
|||||
Proceeds from issuance of long-term debt
|
—
|
|
|
(1
|
)
|
|
19
|
|
|
—
|
|
|
18
|
|
|||||
Proceeds from issuance of commercial paper
|
—
|
|
|
377
|
|
|
—
|
|
|
—
|
|
|
377
|
|
|||||
Repayments of commercial paper
|
—
|
|
|
(377
|
)
|
|
—
|
|
|
—
|
|
|
(377
|
)
|
|||||
Net proceeds from/(payments on) intercompany borrowing activities
|
—
|
|
|
(22
|
)
|
|
(444
|
)
|
|
466
|
|
|
—
|
|
|||||
Dividends paid
|
(976
|
)
|
|
(976
|
)
|
|
—
|
|
|
976
|
|
|
(976
|
)
|
|||||
Other intercompany capital stock transactions
|
—
|
|
|
—
|
|
|
35
|
|
|
(35
|
)
|
|
—
|
|
|||||
Other financing activities, net
|
—
|
|
|
(6
|
)
|
|
(9
|
)
|
|
—
|
|
|
(15
|
)
|
|||||
Net cash provided by/(used for) financing activities
|
(976
|
)
|
|
(1,007
|
)
|
|
(401
|
)
|
|
1,407
|
|
|
(977
|
)
|
|||||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
(8
|
)
|
|||||
Cash, cash equivalents, and restricted cash:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net increase/(decrease)
|
—
|
|
|
500
|
|
|
(178
|
)
|
|
—
|
|
|
322
|
|
|||||
Balance at beginning of period
|
—
|
|
|
202
|
|
|
934
|
|
|
—
|
|
|
1,136
|
|
|||||
Balance at end of period
|
$
|
—
|
|
|
$
|
702
|
|
|
$
|
756
|
|
|
$
|
—
|
|
|
$
|
1,458
|
|
|
As Restated
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by/(used for) operating activities
|
$
|
1,659
|
|
|
$
|
514
|
|
|
$
|
(298
|
)
|
|
$
|
(1,659
|
)
|
|
$
|
216
|
|
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash receipts on sold receivables
|
—
|
|
|
—
|
|
|
1,221
|
|
|
—
|
|
|
1,221
|
|
|||||
Capital expenditures
|
—
|
|
|
(196
|
)
|
|
(242
|
)
|
|
—
|
|
|
(438
|
)
|
|||||
Payments to acquire business, net of cash acquired
|
—
|
|
|
(237
|
)
|
|
22
|
|
|
—
|
|
|
(215
|
)
|
|||||
Net proceeds from/(payments on) intercompany lending activities
|
—
|
|
|
785
|
|
|
186
|
|
|
(971
|
)
|
|
—
|
|
|||||
Additional investments in subsidiaries
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
5
|
|
|
—
|
|
|||||
Return of capital
|
6
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|||||
Proceeds from sale of business, net of cash disposed
|
—
|
|
|
—
|
|
|
18
|
|
|
—
|
|
|
18
|
|
|||||
Other investing activities, net
|
—
|
|
|
(6
|
)
|
|
(1
|
)
|
|
—
|
|
|
(7
|
)
|
|||||
Net cash provided by/(used for) investing activities
|
6
|
|
|
341
|
|
|
1,204
|
|
|
(972
|
)
|
|
579
|
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Repayments of long-term debt
|
—
|
|
|
(8
|
)
|
|
(4
|
)
|
|
—
|
|
|
(12
|
)
|
|||||
Proceeds from issuance of long-term debt
|
—
|
|
|
2,990
|
|
|
—
|
|
|
—
|
|
|
2,990
|
|
|||||
Proceeds from issuance of commercial paper
|
—
|
|
|
1,525
|
|
|
—
|
|
|
—
|
|
|
1,525
|
|
|||||
Repayments of commercial paper
|
—
|
|
|
(1,950
|
)
|
|
—
|
|
|
—
|
|
|
(1,950
|
)
|
|||||
Net proceeds from/(payments on) intercompany borrowing activities
|
—
|
|
|
(186
|
)
|
|
(785
|
)
|
|
971
|
|
|
—
|
|
|||||
Dividends paid
|
(1,659
|
)
|
|
(1,659
|
)
|
|
—
|
|
|
1,659
|
|
|
(1,659
|
)
|
|||||
Other intercompany capital stock transactions
|
—
|
|
|
(6
|
)
|
|
5
|
|
|
1
|
|
|
—
|
|
|||||
Other financing activities, net
|
(6
|
)
|
|
(16
|
)
|
|
19
|
|
|
—
|
|
|
(3
|
)
|
|||||
Net cash provided by/(used for) financing activities
|
(1,665
|
)
|
|
690
|
|
|
(765
|
)
|
|
2,631
|
|
|
891
|
|
|||||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
|
—
|
|
|
—
|
|
|
(80
|
)
|
|
—
|
|
|
(80
|
)
|
|||||
Cash, cash equivalents, and restricted cash:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net increase/(decrease)
|
—
|
|
|
1,545
|
|
|
61
|
|
|
—
|
|
|
1,606
|
|
|||||
Balance at beginning of period
|
—
|
|
|
644
|
|
|
1,125
|
|
|
—
|
|
|
1,769
|
|
|||||
Balance at end of period
|
$
|
—
|
|
|
$
|
2,189
|
|
|
$
|
1,186
|
|
|
$
|
—
|
|
|
$
|
3,375
|
|
|
As Previously Reported
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by/(used for) operating activities
|
$
|
1,659
|
|
|
$
|
524
|
|
|
$
|
(295
|
)
|
|
$
|
(1,659
|
)
|
|
$
|
229
|
|
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash receipts on sold receivables
|
—
|
|
|
—
|
|
|
1,221
|
|
|
—
|
|
|
1,221
|
|
|||||
Capital expenditures
|
—
|
|
|
(196
|
)
|
|
(242
|
)
|
|
—
|
|
|
(438
|
)
|
|||||
Payments to acquire business, net of cash acquired
|
—
|
|
|
(236
|
)
|
|
21
|
|
|
—
|
|
|
(215
|
)
|
|||||
Net proceeds from/(payments on) intercompany lending activities
|
—
|
|
|
785
|
|
|
186
|
|
|
(971
|
)
|
|
—
|
|
|||||
Additional investments in subsidiaries
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
5
|
|
|
—
|
|
|||||
Return of capital
|
6
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|||||
Proceeds from sale of business, net of cash disposed
|
—
|
|
|
—
|
|
|
18
|
|
|
—
|
|
|
18
|
|
|||||
Other investing activities, net
|
—
|
|
|
(6
|
)
|
|
(1
|
)
|
|
—
|
|
|
(7
|
)
|
|||||
Net cash provided by/(used for) investing activities
|
6
|
|
|
342
|
|
|
1,203
|
|
|
(972
|
)
|
|
579
|
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Repayments of long-term debt
|
—
|
|
|
(20
|
)
|
|
(5
|
)
|
|
—
|
|
|
(25
|
)
|
|||||
Proceeds from issuance of long-term debt
|
—
|
|
|
2,990
|
|
|
—
|
|
|
—
|
|
|
2,990
|
|
|||||
Proceeds from issuance of commercial paper
|
—
|
|
|
1,525
|
|
|
—
|
|
|
—
|
|
|
1,525
|
|
|||||
Repayments of commercial paper
|
—
|
|
|
(1,950
|
)
|
|
—
|
|
|
—
|
|
|
(1,950
|
)
|
|||||
Net proceeds from/(payments on) intercompany borrowing activities
|
—
|
|
|
(186
|
)
|
|
(785
|
)
|
|
971
|
|
|
—
|
|
|||||
Dividends paid
|
(1,659
|
)
|
|
(1,659
|
)
|
|
—
|
|
|
1,659
|
|
|
(1,659
|
)
|
|||||
Other intercompany capital stock transactions
|
—
|
|
|
(6
|
)
|
|
5
|
|
|
1
|
|
|
—
|
|
|||||
Other financing activities, net
|
(6
|
)
|
|
(15
|
)
|
|
18
|
|
|
—
|
|
|
(3
|
)
|
|||||
Net cash provided by/(used for) financing activities
|
(1,665
|
)
|
|
679
|
|
|
(767
|
)
|
|
2,631
|
|
|
878
|
|
|||||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
|
—
|
|
|
—
|
|
|
(80
|
)
|
|
—
|
|
|
(80
|
)
|
|||||
Cash, cash equivalents, and restricted cash:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net increase/(decrease)
|
—
|
|
|
1,545
|
|
|
61
|
|
|
—
|
|
|
1,606
|
|
|||||
Balance at beginning of period
|
—
|
|
|
644
|
|
|
1,125
|
|
|
—
|
|
|
1,769
|
|
|||||
Balance at end of period
|
$
|
—
|
|
|
$
|
2,189
|
|
|
$
|
1,186
|
|
|
$
|
—
|
|
|
$
|
3,375
|
|
|
June 29, 2019
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
702
|
|
|
$
|
750
|
|
|
$
|
—
|
|
|
$
|
1,452
|
|
Restricted cash included in other current assets
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|||||
Restricted cash included in other non-current assets
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
|||||
Cash, cash equivalents, and restricted cash
|
$
|
—
|
|
|
$
|
702
|
|
|
$
|
756
|
|
|
$
|
—
|
|
|
$
|
1,458
|
|
|
December 29, 2018
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
202
|
|
|
$
|
928
|
|
|
$
|
—
|
|
|
$
|
1,130
|
|
Restricted cash included in other current assets
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|||||
Restricted cash included in other non-current assets
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
|||||
Cash, cash equivalents, and restricted cash
|
$
|
—
|
|
|
$
|
202
|
|
|
$
|
934
|
|
|
$
|
—
|
|
|
$
|
1,136
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
||||||||||
|
|
|
(As Restated)
|
|
|
|
|
|
(As Restated)
|
|
|
||||||||||
|
(in millions, except per share data)
|
|
|
|
(in millions, except per share data)
|
|
|
||||||||||||||
Net sales
|
$
|
6,406
|
|
|
$
|
6,690
|
|
|
(4.2
|
)%
|
|
$
|
12,365
|
|
|
$
|
12,994
|
|
|
(4.8
|
)%
|
Operating income/(loss)
|
734
|
|
|
1,357
|
|
|
(45.9
|
)%
|
|
1,296
|
|
|
2,857
|
|
|
(54.6
|
)%
|
||||
Net income/(loss) attributable to common shareholders
|
449
|
|
|
754
|
|
|
(40.6
|
)%
|
|
854
|
|
|
1,757
|
|
|
(51.4
|
)%
|
||||
Diluted EPS
|
0.37
|
|
|
0.62
|
|
|
(40.3
|
)%
|
|
0.70
|
|
|
1.43
|
|
|
(51.0
|
)%
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
||||||||||
|
|
|
(As Restated)
|
|
|
|
|
|
(As Restated)
|
|
|
||||||||||
|
(in millions, except per share data)
|
|
|
|
(in millions, except per share data)
|
|
|
||||||||||||||
Net sales
|
$
|
6,406
|
|
|
$
|
6,690
|
|
|
(4.2
|
)%
|
|
$
|
12,365
|
|
|
$
|
12,994
|
|
|
(4.8
|
)%
|
Organic Net Sales(a)
|
6,497
|
|
|
6,515
|
|
|
(0.3
|
)%
|
|
12,519
|
|
|
12,712
|
|
|
(1.5
|
)%
|
(a)
|
Organic Net Sales is a non-GAAP financial measure. See the Non-GAAP Financial Measures section at the end of this item.
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
||||||||||
|
|
|
(As Restated)
|
|
|
|
|
|
(As Restated)
|
|
|
||||||||||
|
(in millions)
|
|
|
|
(in millions)
|
|
|
||||||||||||||
Operating income/(loss)
|
$
|
734
|
|
|
$
|
1,357
|
|
|
(45.9
|
)%
|
|
$
|
1,296
|
|
|
$
|
2,857
|
|
|
(54.6
|
)%
|
Net income/(loss) attributable to common shareholders
|
449
|
|
|
754
|
|
|
(40.6
|
)%
|
|
854
|
|
|
1,757
|
|
|
(51.4
|
)%
|
||||
Adjusted EBITDA(a)
|
1,600
|
|
|
1,949
|
|
|
(17.9
|
)%
|
|
3,031
|
|
|
3,756
|
|
|
(19.3
|
)%
|
(a)
|
Adjusted EBITDA is a non-GAAP financial measure. See the Non-GAAP Financial Measures section at the end of this item.
|
•
|
Other expense/(income) was $133 million of income for the three months ended June 29, 2019 compared to $20 million of income for the three months ended June 30, 2018. This increase was primarily due to a $58 million non-cash settlement charge in the prior period related to the wind-up of a non-U.S. pension plan, lower derivative losses, lower nonmonetary currency devaluation losses related to our Venezuelan operations, and a loss on our South Africa divestiture in the prior period, partially offset by lower income related to our postemployment benefit plans.
|
•
|
The effective tax rate was 18.8% for the three months ended June 29, 2019 compared to 29.0% for the three months ended June 30, 2018. The decrease in our effective tax rate was primarily driven by the favorable geographic mix of pre-tax income in various non-U.S. jurisdictions and favorability from net discrete items, primarily related to reversals of reserves for uncertain tax positions in the U.S. and certain state jurisdictions, partially offset by non-deductible goodwill impairments in the current year. Additionally, in the prior year, we had an unfavorable impact from net discrete items, primarily related to the revaluation of our deferred tax balances due to changes in state tax laws and non-deductible goodwill impairments, which were partially offset by the favorable impact of derivative losses on foreign exchange contracts.
|
•
|
The effective tax rate was 27.3% for the six months ended June 29, 2019 compared to 24.8% for the six months ended June 30, 2018. The increase in our effective tax rate was primarily driven by the unfavorable impact of net discrete items, partially offset by the favorable geographic mix of pre-tax income in various non-U.S. jurisdictions. The unfavorable impact of net discrete items was primarily driven by non-deductible goodwill impairments, partially offset by reversals of reserves for uncertain tax positions in the U.S. and certain state jurisdictions. Additionally, in the prior year, we had an unfavorable impact from net discrete items, primarily related to the revaluation of our deferred tax balances due to changes in state tax laws.
|
•
|
Other expense/(income) was $513 million of income for the six months ended June 29, 2019 compared to $110 million of income for the six months ended June 30, 2018. This increase was primarily due to a $246 million gain on our Heinz India divestiture in the current period compared to a $15 million loss on our South Africa divestiture in the prior period, lower nonmonetary currency devaluation losses related to our Venezuelan operations, and a $58 million non-cash settlement charge in the prior period related to the wind-up of a non-U.S. pension plan, partially offset by lower income related to our postemployment benefit plans.
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
||||||||||
|
|
|
(As Restated)
|
|
|
|
|
|
(As Restated)
|
|
|
||||||||||
|
(in millions, except per share data)
|
|
|
|
(in millions, except per share data)
|
|
|
||||||||||||||
Diluted EPS
|
$
|
0.37
|
|
|
$
|
0.62
|
|
|
(40.3
|
)%
|
|
$
|
0.70
|
|
|
$
|
1.43
|
|
|
(51.0
|
)%
|
Adjusted EPS(a)
|
0.78
|
|
|
0.99
|
|
|
(21.2
|
)%
|
|
1.44
|
|
|
1.89
|
|
|
(23.8
|
)%
|
(a)
|
Adjusted EPS is a non-GAAP financial measure. See the Non-GAAP Financial Measures section at the end of this item.
|
|
For the Three Months Ended
|
|||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
(As Restated)
|
|
|
|
|
|||||||
Diluted EPS
|
$
|
0.37
|
|
|
$
|
0.62
|
|
|
$
|
(0.25
|
)
|
|
(40.3
|
)%
|
Integration and restructuring expenses
|
0.01
|
|
|
0.11
|
|
|
(0.10
|
)
|
|
|
||||
Deal costs
|
—
|
|
|
0.01
|
|
|
(0.01
|
)
|
|
|
||||
Unrealized losses/(gains) on commodity hedges
|
(0.01
|
)
|
|
—
|
|
|
(0.01
|
)
|
|
|
||||
Impairment losses
|
0.41
|
|
|
0.17
|
|
|
0.24
|
|
|
|
||||
Losses/(gains) on sale of business
|
—
|
|
|
0.01
|
|
|
(0.01
|
)
|
|
|
||||
Nonmonetary currency devaluation
|
—
|
|
|
0.02
|
|
|
(0.02
|
)
|
|
|
||||
U.S. Tax Reform discrete income tax expense/(benefit)
|
—
|
|
|
0.05
|
|
|
(0.05
|
)
|
|
|
||||
Adjusted EPS(a)
|
$
|
0.78
|
|
|
$
|
0.99
|
|
|
$
|
(0.21
|
)
|
|
(21.2
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Key drivers of change in Adjusted EPS(a):
|
|
|
|
|
|
|
|
|||||||
Results of operations
|
|
|
|
|
$
|
(0.23
|
)
|
|
|
|||||
Change in other expense/(income)
|
|
|
|
|
0.01
|
|
|
|
||||||
Change in effective tax rate
|
|
|
|
|
0.01
|
|
|
|
||||||
|
|
|
|
|
$
|
(0.21
|
)
|
|
|
(a)
|
Adjusted EPS is a non-GAAP financial measure. See the Non-GAAP Financial Measures section at the end of this item.
|
|
For the Six Months Ended
|
|||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
(As Restated)
|
|
|
|
|
|||||||
Diluted EPS
|
$
|
0.70
|
|
|
$
|
1.43
|
|
|
$
|
(0.73
|
)
|
|
(51.0
|
)%
|
Integration and restructuring expenses
|
0.02
|
|
|
0.17
|
|
|
(0.15
|
)
|
|
|
||||
Deal costs
|
0.01
|
|
|
0.01
|
|
|
—
|
|
|
|
||||
Unrealized losses/(gains) on commodity hedges
|
(0.02
|
)
|
|
—
|
|
|
(0.02
|
)
|
|
|
||||
Impairment losses
|
0.89
|
|
|
0.17
|
|
|
0.72
|
|
|
|
||||
Losses/(gains) on sale of business
|
(0.16
|
)
|
|
0.01
|
|
|
(0.17
|
)
|
|
|
||||
Nonmonetary currency devaluation
|
—
|
|
|
0.06
|
|
|
(0.06
|
)
|
|
|
||||
U.S. Tax Reform discrete income tax expense/(benefit)
|
—
|
|
|
0.04
|
|
|
(0.04
|
)
|
|
|
||||
Adjusted EPS(a)
|
$
|
1.44
|
|
|
$
|
1.89
|
|
|
$
|
(0.45
|
)
|
|
(23.8
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Key drivers of change in Adjusted EPS(a):
|
|
|
|
|
|
|
|
|||||||
Results of operations
|
|
|
|
|
$
|
(0.50
|
)
|
|
|
|||||
Change in other expense/(income)
|
|
|
|
|
0.01
|
|
|
|
||||||
Change in effective tax rate
|
|
|
|
|
0.04
|
|
|
|
||||||
|
|
|
|
|
$
|
(0.45
|
)
|
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
|
|
|
(As Restated)
|
|
|
|
(As Restated)
|
||||||||
|
(in millions)
|
||||||||||||||
Net sales:
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
4,511
|
|
|
$
|
4,513
|
|
|
$
|
8,713
|
|
|
$
|
8,881
|
|
Canada
|
560
|
|
|
564
|
|
|
1,010
|
|
|
1,048
|
|
||||
EMEA
|
643
|
|
|
707
|
|
|
1,250
|
|
|
1,392
|
|
||||
Rest of World
|
692
|
|
|
906
|
|
|
1,392
|
|
|
1,673
|
|
||||
Total net sales
|
$
|
6,406
|
|
|
$
|
6,690
|
|
|
$
|
12,365
|
|
|
$
|
12,994
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
|
|
|
(As Restated)
|
|
|
|
(As Restated)
|
||||||||
|
(in millions)
|
||||||||||||||
Organic Net Sales(a):
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
4,511
|
|
|
$
|
4,513
|
|
|
$
|
8,713
|
|
|
$
|
8,881
|
|
Canada
|
581
|
|
|
564
|
|
|
1,052
|
|
|
1,048
|
|
||||
EMEA
|
679
|
|
|
696
|
|
|
1,335
|
|
|
1,371
|
|
||||
Rest of World
|
726
|
|
|
742
|
|
|
1,419
|
|
|
1,412
|
|
||||
Total Organic Net Sales
|
$
|
6,497
|
|
|
$
|
6,515
|
|
|
$
|
12,519
|
|
|
$
|
12,712
|
|
(a)
|
Organic Net Sales is a non-GAAP financial measure. See the Non-GAAP Financial Measures section at the end of this item.
|
|
Net Sales
|
|
Currency
|
|
Acquisitions and Divestitures
|
|
Organic Net Sales
|
|
Price
|
|
Volume/Mix
|
||
For the Three Months Ended
|
|
|
|
|
|
|
|
|
|
|
|
||
United States
|
(0.1
|
)%
|
|
0.0 pp
|
|
0.0 pp
|
|
(0.1
|
)%
|
|
(0.4) pp
|
|
0.3 pp
|
Canada
|
(0.7
|
)%
|
|
(3.6) pp
|
|
0.0 pp
|
|
2.9
|
%
|
|
(2.4) pp
|
|
5.3 pp
|
EMEA
|
(8.9
|
)%
|
|
(5.0) pp
|
|
(1.6) pp
|
|
(2.3
|
)%
|
|
(0.2) pp
|
|
(2.1) pp
|
Rest of World
|
(23.6
|
)%
|
|
(13.9) pp
|
|
(7.7) pp
|
|
(2.0
|
)%
|
|
2.0 pp
|
|
(4.0) pp
|
Kraft Heinz
|
(4.2
|
)%
|
|
(2.8) pp
|
|
(1.1) pp
|
|
(0.3
|
)%
|
|
(0.3) pp
|
|
0.0 pp
|
|
|
|
|
|
|
|
|
|
|
|
|
||
For the Six Months Ended
|
|
|
|
|
|
|
|
|
|
|
|
||
United States
|
(1.9
|
)%
|
|
0.0 pp
|
|
0.0 pp
|
|
(1.9
|
)%
|
|
(1.8) pp
|
|
(0.1) pp
|
Canada
|
(3.6
|
)%
|
|
(4.0) pp
|
|
0.0 pp
|
|
0.4
|
%
|
|
(2.3) pp
|
|
2.7 pp
|
EMEA
|
(10.2
|
)%
|
|
(6.1) pp
|
|
(1.5) pp
|
|
(2.6
|
)%
|
|
(0.1) pp
|
|
(2.5) pp
|
Rest of World
|
(16.8
|
)%
|
|
(12.7) pp
|
|
(4.7) pp
|
|
0.6
|
%
|
|
1.6 pp
|
|
(1.0) pp
|
Kraft Heinz
|
(4.8
|
)%
|
|
(2.6) pp
|
|
(0.7) pp
|
|
(1.5
|
)%
|
|
(1.3) pp
|
|
(0.2) pp
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
|
|
|
(As Restated)
|
|
|
|
(As Restated)
|
||||||||
|
(in millions)
|
||||||||||||||
Segment Adjusted EBITDA:
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
1,251
|
|
|
$
|
1,401
|
|
|
$
|
2,384
|
|
|
$
|
2,793
|
|
Canada
|
143
|
|
|
173
|
|
|
264
|
|
|
307
|
|
||||
EMEA
|
171
|
|
|
206
|
|
|
314
|
|
|
388
|
|
||||
Rest of World
|
102
|
|
|
213
|
|
|
203
|
|
|
357
|
|
||||
General corporate expenses
|
(67
|
)
|
|
(44
|
)
|
|
(134
|
)
|
|
(89
|
)
|
||||
Depreciation and amortization (excluding integration and restructuring expenses)
|
(253
|
)
|
|
(235
|
)
|
|
(487
|
)
|
|
(434
|
)
|
||||
Integration and restructuring expenses
|
(14
|
)
|
|
(93
|
)
|
|
(41
|
)
|
|
(183
|
)
|
||||
Deal costs
|
(5
|
)
|
|
(7
|
)
|
|
(13
|
)
|
|
(16
|
)
|
||||
Unrealized gains/(losses) on commodity hedges
|
10
|
|
|
(3
|
)
|
|
39
|
|
|
(5
|
)
|
||||
Impairment losses
|
(598
|
)
|
|
(234
|
)
|
|
(1,218
|
)
|
|
(234
|
)
|
||||
Equity award compensation expense (excluding integration and restructuring expenses)
|
(6
|
)
|
|
(20
|
)
|
|
(15
|
)
|
|
(27
|
)
|
||||
Operating income/(loss)
|
734
|
|
|
1,357
|
|
|
1,296
|
|
|
2,857
|
|
||||
Interest expense
|
316
|
|
|
316
|
|
|
637
|
|
|
633
|
|
||||
Other expense/(income)
|
(133
|
)
|
|
(20
|
)
|
|
(513
|
)
|
|
(110
|
)
|
||||
Income/(loss) before income taxes
|
$
|
551
|
|
|
$
|
1,061
|
|
|
$
|
1,172
|
|
|
$
|
2,334
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
||||||||||
|
|
|
(As Restated)
|
|
|
|
|
|
(As Restated)
|
|
|
||||||||||
|
(in millions)
|
|
|
|
(in millions)
|
|
|
||||||||||||||
Net sales
|
$
|
4,511
|
|
|
$
|
4,513
|
|
|
(0.1
|
)%
|
|
$
|
8,713
|
|
|
$
|
8,881
|
|
|
(1.9
|
)%
|
Organic Net Sales(a)
|
4,511
|
|
|
4,513
|
|
|
(0.1
|
)%
|
|
8,713
|
|
|
8,881
|
|
|
(1.9
|
)%
|
||||
Segment Adjusted EBITDA
|
1,251
|
|
|
1,401
|
|
|
(10.7
|
)%
|
|
2,384
|
|
|
2,793
|
|
|
(14.6
|
)%
|
(a)
|
Organic Net Sales is a non-GAAP financial measure. See the Non-GAAP Financial Measures section at the end of this item.
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
||||||||||
|
|
|
(As Restated)
|
|
|
|
|
|
(As Restated)
|
|
|
||||||||||
|
(in millions)
|
|
|
|
(in millions)
|
|
|
||||||||||||||
Net sales
|
$
|
560
|
|
|
$
|
564
|
|
|
(0.7
|
)%
|
|
$
|
1,010
|
|
|
$
|
1,048
|
|
|
(3.6
|
)%
|
Organic Net Sales(a)
|
581
|
|
|
564
|
|
|
2.9
|
%
|
|
1,052
|
|
|
1,048
|
|
|
0.4
|
%
|
||||
Segment Adjusted EBITDA
|
143
|
|
|
173
|
|
|
(17.0
|
)%
|
|
264
|
|
|
307
|
|
|
(14.1
|
)%
|
(a)
|
Organic Net Sales is a non-GAAP financial measure. See the Non-GAAP Financial Measures section at the end of this item.
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
||||||||||
|
|
|
(As Restated)
|
|
|
|
|
|
(As Restated)
|
|
|
||||||||||
|
(in millions)
|
|
|
|
(in millions)
|
|
|
||||||||||||||
Net sales
|
$
|
643
|
|
|
$
|
707
|
|
|
(8.9
|
)%
|
|
$
|
1,250
|
|
|
$
|
1,392
|
|
|
(10.2
|
)%
|
Organic Net Sales(a)
|
679
|
|
|
696
|
|
|
(2.3
|
)%
|
|
1,335
|
|
|
1,371
|
|
|
(2.6
|
)%
|
||||
Segment Adjusted EBITDA
|
171
|
|
|
206
|
|
|
(17.1
|
)%
|
|
314
|
|
|
388
|
|
|
(19.1
|
)%
|
(a)
|
Organic Net Sales is a non-GAAP financial measure. See the Non-GAAP Financial Measures section at the end of this item.
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
|
June 29, 2019
|
|
June 30, 2018
|
|
% Change
|
||||||||||
|
|
|
(As Restated)
|
|
|
|
|
|
(As Restated)
|
|
|
||||||||||
|
(in millions)
|
|
|
|
(in millions)
|
|
|
||||||||||||||
Net sales
|
$
|
692
|
|
|
$
|
906
|
|
|
(23.6
|
)%
|
|
$
|
1,392
|
|
|
$
|
1,673
|
|
|
(16.8
|
)%
|
Organic Net Sales(a)
|
726
|
|
|
742
|
|
|
(2.0
|
)%
|
|
1,419
|
|
|
1,412
|
|
|
0.6
|
%
|
||||
Segment Adjusted EBITDA
|
102
|
|
|
213
|
|
|
(52.1
|
)%
|
|
203
|
|
|
357
|
|
|
(43.0
|
)%
|
(a)
|
Organic Net Sales is a non-GAAP financial measure. See the Non-GAAP Financial Measures section at the end of this item.
|
|
Goodwill or Brand Carrying Amount
(in billions) |
|
Discount Rate
|
|
Long-Term Growth Rate
|
|
Royalty Rate
|
||||||||||||||
|
|
Minimum
|
|
Maximum
|
|
Minimum
|
|
Maximum
|
|
Minimum
|
|
Maximum
|
|||||||||
Reporting units
|
$
|
33.0
|
|
|
7.0
|
%
|
|
10.3
|
%
|
|
1.5
|
%
|
|
4.0
|
%
|
|
|
|
|
||
Brands
(excess earnings method)
|
19.4
|
|
|
7.7
|
%
|
|
7.8
|
%
|
|
0.8
|
%
|
|
2.0
|
%
|
|
|
|
|
|||
Brands
(relief from royalty method)
|
7.0
|
|
|
7.7
|
%
|
|
10.7
|
%
|
|
0.5
|
%
|
|
3.5
|
%
|
|
7.0
|
%
|
|
20.0
|
%
|
|
Goodwill or Brand Carrying Amount
(in billions) |
|
Discount Rate
|
|
Long-Term Growth Rate
|
|
Royalty Rate
|
||||||||||||||
|
|
Minimum
|
|
Maximum
|
|
Minimum
|
|
Maximum
|
|
Minimum
|
|
Maximum
|
|||||||||
Reporting units
|
$
|
0.6
|
|
|
9.0
|
%
|
|
11.3
|
%
|
|
2.5
|
%
|
|
3.5
|
%
|
|
|
|
|
||
Brands
(excess earnings method)
|
3.3
|
|
|
7.8
|
%
|
|
7.8
|
%
|
|
1.0
|
%
|
|
1.0
|
%
|
|
|
|
|
|||
Brands
(relief from royalty method)
|
0.3
|
|
|
7.8
|
%
|
|
10.3
|
%
|
|
1.5
|
%
|
|
4.0
|
%
|
|
1.0
|
%
|
|
17.0
|
%
|
|
Discount Rate
|
|
Long-Term Growth Rate
|
|
Royalty Rate
|
||||||||||||||||||
|
50-Basis-Point
|
|
25-Basis-Point
|
|
100-Basis-Point
|
||||||||||||||||||
|
Increase
|
|
Decrease
|
|
Increase
|
|
Decrease
|
|
Increase
|
|
Decrease
|
||||||||||||
Reporting units
|
$
|
(5.6
|
)
|
|
$
|
6.7
|
|
|
$
|
2.7
|
|
|
$
|
(2.5
|
)
|
|
|
|
|
||||
Brands (excess earnings method)
|
(1.4
|
)
|
|
1.7
|
|
|
0.6
|
|
|
(0.6
|
)
|
|
|
|
|
||||||||
Brands (relief from royalty method)
|
(0.5
|
)
|
|
0.6
|
|
|
0.2
|
|
|
(0.2
|
)
|
|
$
|
0.6
|
|
|
$
|
(0.6
|
)
|
|
Discount Rate
|
|
Long-Term Growth Rate
|
|
Royalty Rate
|
||||||||||||||||||
|
50-Basis-Point
|
|
100-Basis-Point
|
||||||||||||||||||||
|
Increase
|
|
Decrease
|
|
Increase
|
|
Decrease
|
|
Increase
|
|
Decrease
|
||||||||||||
Reporting units
|
$
|
(0.1
|
)
|
|
$
|
0.1
|
|
|
$
|
0.1
|
|
|
$
|
—
|
|
|
|
|
|
||||
Brands (excess earnings method)
|
(0.3
|
)
|
|
0.3
|
|
|
0.1
|
|
|
(0.1
|
)
|
|
|
|
|
||||||||
Brands (relief from royalty method)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Net Sales
|
|
Currency
|
|
Acquisitions and Divestitures
|
|
Organic Net Sales
|
|
Price
|
|
Volume/Mix
|
||||||||
Three Months Ended June 29, 2019
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
4,511
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,511
|
|
|
|
|
|
Canada
|
560
|
|
|
(21
|
)
|
|
—
|
|
|
581
|
|
|
|
|
|
||||
EMEA
|
643
|
|
|
(36
|
)
|
|
—
|
|
|
679
|
|
|
|
|
|
||||
Rest of World
|
692
|
|
|
(34
|
)
|
|
—
|
|
|
726
|
|
|
|
|
|
||||
Kraft Heinz
|
$
|
6,406
|
|
|
$
|
(91
|
)
|
|
$
|
—
|
|
|
$
|
6,497
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Three Months Ended June 30, 2018
(As Restated)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
4,513
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,513
|
|
|
|
|
|
Canada
|
564
|
|
|
—
|
|
|
—
|
|
|
564
|
|
|
|
|
|
||||
EMEA
|
707
|
|
|
—
|
|
|
11
|
|
|
696
|
|
|
|
|
|
||||
Rest of World
|
906
|
|
|
101
|
|
|
63
|
|
|
742
|
|
|
|
|
|
||||
Kraft Heinz
|
$
|
6,690
|
|
|
$
|
101
|
|
|
$
|
74
|
|
|
$
|
6,515
|
|
|
|
|
|
|
Net Sales
|
|
Currency
|
|
Acquisitions and Divestitures
|
|
Organic Net Sales
|
|
Price
|
|
Volume/Mix
|
||||||||
Six Months Ended June 29, 2019
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
8,713
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,713
|
|
|
|
|
|
Canada
|
1,010
|
|
|
(42
|
)
|
|
—
|
|
|
1,052
|
|
|
|
|
|
||||
EMEA
|
1,250
|
|
|
(85
|
)
|
|
—
|
|
|
1,335
|
|
|
|
|
|
||||
Rest of World
|
1,392
|
|
|
(78
|
)
|
|
51
|
|
|
1,419
|
|
|
|
|
|
||||
Kraft Heinz
|
$
|
12,365
|
|
|
$
|
(205
|
)
|
|
$
|
51
|
|
|
$
|
12,519
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Six Months Ended June 30, 2018
(As Restated)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
8,881
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,881
|
|
|
|
|
|
Canada
|
1,048
|
|
|
—
|
|
|
—
|
|
|
1,048
|
|
|
|
|
|
||||
EMEA
|
1,392
|
|
|
—
|
|
|
21
|
|
|
1,371
|
|
|
|
|
|
||||
Rest of World
|
1,673
|
|
|
140
|
|
|
121
|
|
|
1,412
|
|
|
|
|
|
||||
Kraft Heinz
|
$
|
12,994
|
|
|
$
|
140
|
|
|
$
|
142
|
|
|
$
|
12,712
|
|
|
|
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
|
|
|
(As Restated)
|
|
|
|
(As Restated)
|
||||||||
Net income/(loss)
|
$
|
448
|
|
|
$
|
753
|
|
|
$
|
852
|
|
|
$
|
1,756
|
|
Interest expense
|
316
|
|
|
316
|
|
|
637
|
|
|
633
|
|
||||
Other expense/(income)
|
(133
|
)
|
|
(20
|
)
|
|
(513
|
)
|
|
(110
|
)
|
||||
Provision for/(benefit from) income taxes
|
103
|
|
|
308
|
|
|
320
|
|
|
578
|
|
||||
Operating income/(loss)
|
734
|
|
|
1,357
|
|
|
1,296
|
|
|
2,857
|
|
||||
Depreciation and amortization (excluding integration and restructuring expenses)
|
253
|
|
|
235
|
|
|
487
|
|
|
434
|
|
||||
Integration and restructuring expenses
|
14
|
|
|
93
|
|
|
41
|
|
|
183
|
|
||||
Deal costs
|
5
|
|
|
7
|
|
|
13
|
|
|
16
|
|
||||
Unrealized losses/(gains) on commodity hedges
|
(10
|
)
|
|
3
|
|
|
(39
|
)
|
|
5
|
|
||||
Impairment losses
|
598
|
|
|
234
|
|
|
1,218
|
|
|
234
|
|
||||
Equity award compensation expense (excluding integration and restructuring expenses)
|
6
|
|
|
20
|
|
|
15
|
|
|
27
|
|
||||
Adjusted EBITDA
|
$
|
1,600
|
|
|
$
|
1,949
|
|
|
$
|
3,031
|
|
|
$
|
3,756
|
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
June 29, 2019
|
|
June 30, 2018
|
|
June 29, 2019
|
|
June 30, 2018
|
||||||||
|
|
|
(As Restated)
|
|
|
|
(As Restated)
|
||||||||
Diluted EPS
|
$
|
0.37
|
|
|
$
|
0.62
|
|
|
$
|
0.70
|
|
|
$
|
1.43
|
|
Integration and restructuring expenses(a)
|
0.01
|
|
|
0.11
|
|
|
0.02
|
|
|
0.17
|
|
||||
Deal costs(b)
|
—
|
|
|
0.01
|
|
|
0.01
|
|
|
0.01
|
|
||||
Unrealized losses/(gains) on commodity hedges(c)
|
(0.01
|
)
|
|
—
|
|
|
(0.02
|
)
|
|
—
|
|
||||
Impairment losses(d)
|
0.41
|
|
|
0.17
|
|
|
0.89
|
|
|
0.17
|
|
||||
Losses/(gains) on sale of business(e)
|
—
|
|
|
0.01
|
|
|
(0.16
|
)
|
|
0.01
|
|
||||
Nonmonetary currency devaluation(f)
|
—
|
|
|
0.02
|
|
|
—
|
|
|
0.06
|
|
||||
U.S. Tax Reform discrete income tax expense/(benefit)(g)
|
—
|
|
|
0.05
|
|
|
—
|
|
|
0.04
|
|
||||
Adjusted EPS
|
$
|
0.78
|
|
|
$
|
0.99
|
|
|
$
|
1.44
|
|
|
$
|
1.89
|
|
(a)
|
Gross expenses included in integration and restructuring expenses were $14 million ($8 million after-tax) for the three months and $41 million ($29 million after-tax) for the six months ended June 29, 2019 and $157 million ($135 million after-tax) for the three months and $247 million ($207 million after-tax) for the six months ended June 30, 2018 and were recorded in the following income statement line items:
|
•
|
Cost of products sold included $6 million for the three months and $15 million for the six months ended June 29, 2019 and $79 million for the three months and $157 million for the six months ended June 30, 2018;
|
•
|
SG&A included $8 million for the three months and $26 million for the six months ended June 29, 2019 and $14 million for the three months and $26 million for the six months ended June 30, 2018; and
|
•
|
Other expense/(income) included expenses of $64 million for the three and six months ended June 30, 2018.
|
(b)
|
Gross expenses included in deal costs were $5 million ($5 million after-tax) for the three months and $13 million ($11 million after-tax) for the six months ended June 29, 2019 and $7 million ($6 million after-tax) for the three months and $16 million ($13 million after-tax) for the six months ended June 30, 2018 and were recorded in the following income statement line items:
|
•
|
Cost of products sold included $4 million for the three and six months ended June 30, 2018; and
|
•
|
SG&A included $5 million for the three months and $13 million for the six months ended June 29, 2019 and $3 million for the three months and $12 million for the six months ended June 30, 2018.
|
(c)
|
Gross expenses/(income) included in unrealized losses/(gains) on commodity hedges were income of $10 million ($8 million after-tax) for the three months and $39 million ($29 million after-tax) for the six months ended June 29, 2019 and expenses of $3 million ($3 million after-tax) for the three months and $5 million ($4 million after-tax) for the six months ended June 30, 2018 and were recorded in cost of products sold.
|
(d)
|
Gross impairment losses, which were recorded in SG&A, included the following:
|
•
|
Goodwill impairment losses of $124 million ($123 million after-tax) for the three months and $744 million ($717 million after-tax) for the six months ended June 29, 2019 and $133 million ($133 million after-tax) for the three and six months ended June 30, 2018; and
|
•
|
Intangible asset impairment losses of $474 million ($374 million after-tax) for the three and six months ended June 29, 2019 and $101 million ($80 million after-tax) for the three and six months ended June 30, 2018.
|
(e)
|
Gross expenses/(income) included in losses/(gains) on sale of business were income of $246 million ($190 million after-tax) for the six months ended June 29, 2019 and expenses of $15 million ($15 million after-tax) for the three and six months ended June 30, 2018 and were recorded in other expense/(income).
|
(f)
|
Gross expenses included in nonmonetary currency devaluation were $2 million ($2 million after-tax) for the three months and $6 million ($6 million after-tax) for the six months ended June 29, 2019 and $20 million ($20 million after-tax) for the three months and $67 million ($67 million after-tax) for the six months ended June 30, 2018 and were recorded in other expense/(income).
|
(g)
|
U.S. Tax Reform discrete income tax expense/(benefit) included expenses of $64 million for the three months and $44 million for the six months ended June 30, 2018.
|
•
|
Supplier Contracts and Related Arrangements: We did not design and maintain effective controls over the accounting for supplier contracts and related arrangements. Specifically, certain employees in our procurement organization engaged in misconduct and circumvented controls that included withholding information or directing others to withhold information related to supplier contracts that affected the accounting for certain supplier rebates, incentives, and pricing arrangements, in an attempt to influence the achievement of internal financial targets that became or were perceived to have become increasingly difficult to attain due to changes in our business environment. Additionally, in certain instances, we did not have a sufficient understanding or maintain sufficient documentation of the transaction to determine the appropriate accounting for certain cost and rebate elements and embedded leases. This material weakness resulted in misstatements that were corrected in the restatement included in our Annual Report on Form 10-K for the year ended December 29, 2018.
|
•
|
Goodwill and Indefinite-lived Intangible Asset Impairment Testing: We did not design and maintain effective controls to reassess the level of precision used to review the impairment assessments related to goodwill and indefinite-lived intangible assets as changes in our business environment occurred. Specifically, we did not design and maintain effective controls to reassess the level of precision used in the review of the allocation of cash flow projections to certain brands used as a basis for performing our fourth quarter 2018 interim impairment assessments in response to the significant reduction in, and in certain instances elimination of, the excess fair value over carrying amount of certain brands that resulted from changes in our business environment.
|
•
|
Performance Targets—We have identified and will be implementing several performance-based target enhancements as follows: (i) implementing checkpoints to evaluate significant changes in the environment that could adversely impact the attainability of management goals and targets; (ii) reassessing and adjusting the overall balance of performance measures
|
•
|
Procurement Practices—We have evaluated our procurement practices and are in the process of implementing improvements to those practices, including: (i) developing more comprehensive contract approval policies and processes; (ii) enhancing required communication protocols among all functions involved in the procurement process (e.g., procurement, legal, accounting, and finance) to ensure all relevant parties are involved in the contract review process; (iii) standardizing contract documentation and analyses; and (iv) developing a more comprehensive accounting review process and monitoring controls over supplier contracts and related arrangements to ensure transactions are recorded in accordance with generally accepted accounting principles.
|
•
|
Training Practices—We are in the process of developing a comprehensive global procurement training program that will cover supplier contracts and related arrangements, including potential accounting implications.
|
•
|
Procurement Management Software—We have started to evaluate potential solutions to implement or upgrade the existing procurement management software to enhance the identification, tracking, and monitoring of supplier contracts and related arrangements.
|
•
|
Personnel Actions—A comprehensive disciplinary plan has been implemented for all employees found to have engaged in misconduct, including termination, written warnings, and appropriate training depending on the severity of the misconduct.
|
•
|
Organizational Enhancements—We have implemented the following organizational enhancements: (i) augmented our procurement finance teams with additional professionals with the appropriate levels of accounting and controls knowledge, experience, and training in the area of supplier contracts and related arrangements; and (ii) realigned reporting lines whereby procurement finance now report directly to the finance organization.
|
•
|
Level of Precision Applied to Impairment Testing—We have enhanced the level of precision at which our internal controls over financial reporting relating to goodwill and indefinite-lived intangible asset impairment assessments are performed. Specifically, we implemented and executed additional procedures to (i) enhance our analysis of forecasted cash flows used in the impairment assessment and (ii) test the accuracy of forecasted cash flow allocations to specific brands.
|
|
|
Total Number
of Shares Purchased(a)
|
|
Average Price
Paid Per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(b)
|
|
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
|
||||||
3/31/2019 - 5/4/2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
5/5/2019 - 6/1/2019
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
6/2/2019 - 6/29/2019
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Total
|
|
—
|
|
|
|
|
—
|
|
|
|
(a)
|
Includes the following types of share repurchase activity, when they occur: (1) shares repurchased in connection with the exercise of stock options (including periodic repurchases using option exercise proceeds), (2) shares withheld for tax liabilities associated with the vesting of restricted stock units, and (3) shares repurchased related to employee benefit programs (including our annual bonus swap program) or to offset the dilutive effect of equity issuances.
|
(b)
|
We do not have any publicly announced share repurchase plans or programs.
|
Exhibit No.
|
|
Descriptions
|
10.1
|
|
|
10.2
|
|
|
10.3
|
|
|
10.4
|
|
|
10.5
|
|
|
31.1
|
|
|
31.2
|
|
|
32.1
|
|
|
32.2
|
|
|
101.1
|
|
The following materials from The Kraft Heinz Company’s Quarterly Report on Form 10-Q for the period ended June 29, 2019 formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) the Condensed Consolidated Statements of Income, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Statements of Equity, (iv) the Condensed Consolidated Balance Sheets, (v) the Condensed Consolidated Statements of Cash Flows, (vi) Notes to Condensed Consolidated Financial Statements, and (vii) document and entity information.
|
104.1
|
|
The cover page from The Kraft Heinz Company’s Quarterly Report on Form 10-Q for the quarter ended June 29, 2019, formatted in Inline XBRL.
|
|
|
The Kraft Heinz Company
|
|
Date:
|
August 13, 2019
|
|
|
|
|
By:
|
/s/ David H. Knopf
|
|
|
|
David H. Knopf
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
(Duly Authorized Officer and Principal Financial Officer)
|
|
|
The Kraft Heinz Company
|
|
Date:
|
August 13, 2019
|
|
|
|
|
By:
|
/s/ Vince Garlati
|
|
|
|
Vince Garlati
|
|
|
|
Vice President, Global Controller
|
|
|
|
(Principal Accounting Officer)
|
/s/ Bernardo Hees
|
|
Date:
|
June 25, 2019
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Bernardo Hees
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ACCEPTED FOR THE KRAFT HEINZ COMPANY
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By:
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/s/ Melissa Werneck
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Title:
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Chief People Officer
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Date:
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June 25, 2019
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/s/ Bernardo Hees
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Date:
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June 30, 2019
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Bernardo Hees
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ACCEPTED FOR THE KRAFT HEINZ COMPANY
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By:
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/s/ Melissa Werneck
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Title:
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Chief People Officer
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Date:
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June 30, 2019
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/s/ Miguel Patricio
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July 1, 2019
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Miguel Patricio
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Date
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Signature:
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/s/ Miguel Patricio
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Date:
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July 1, 2019
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1.
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I have reviewed this Quarterly Report on Form 10-Q for the period ended June 29, 2019 of The Kraft Heinz Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal controls over financial reporting, or caused such internal controls over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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By:
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/s/ Miguel Patricio
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Miguel Patricio
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Chief Executive Officer
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1.
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I have reviewed this Quarterly Report on Form 10-Q for the period ended June 29, 2019 of The Kraft Heinz Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal controls over financial reporting, or caused such internal controls over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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By:
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/s/ David H. Knopf
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David H. Knopf
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Executive Vice President and Chief Financial Officer
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1.
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The Company’s Quarterly Report on Form 10-Q for the period ended June 29, 2019 (the “Form 10-Q”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2.
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The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.
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By:
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/s/ Miguel Patricio
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Name:
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Miguel Patricio
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Title:
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Chief Executive Officer
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1.
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The Company’s Quarterly Report on Form 10-Q for the period ended June 29, 2019 (the “Form 10-Q”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2.
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The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.
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By:
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/s/ David H. Knopf
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Name:
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David H. Knopf
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Title:
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Executive Vice President and Chief Financial Officer
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