Mead Johnson Delivers Strong Earnings; Second Quarter Constant Dollar Sales Up 11 Percent

Conference Call Scheduled

The company will host a conference call at 8:30 a.m. CDT today during which company executives will review second quarter financial results and respond to questions from analysts and investors. The call will be broadcast over the Internet at meadjohnson.com. To listen to the call, visit the website at least 15 minutes before the call and click on the “Investors” tab. Security analysts and investors wishing to participate by telephone should call [phone], pass code: Mead Johnson. Callers outside of North America should call [phone] to be connected. A replay of the conference call will be available through midnight CDT Thursday, August 2, 2012, by calling [phone] or outside of North America by calling [phone], pass code: 94089899. The replay will also be available at meadjohnson.com.

Forward-Looking Statements

Certain statements in this news release are forward looking as defined in the Private Securities Litigation Reform Act of 1995. These statements, which are identified by words such as “expects,” “intends” and “believes,” involve certain risks, uncertainties and assumptions that may cause actual results to differ materially from expectations as of the date of this news release. These risks include, but are not limited to: (1) the ability to sustain brand strength, particularly the “Enfa” family of brands; (2) the effect on the company’s reputation of real or perceived quality issues; (3) the adverse effect of commodity costs; (4) increased competition from branded, private label, store and economy-branded products; (5) the effect of an economic downturn on consumers’ purchasing behavior and customers’ ability to pay for product; (6) inventory reductions by customers; (7) the adverse effect of changes in foreign currency exchange rates; (8) the effect of changes in economic, political and social conditions in the markets where we operate; (9) legislative, regulatory or judicial action that may adversely affect the company’s ability to advertise its products or maintain product margins; (10) the possibility of changes in the Women, Infant and Children (WIC) program, or increases in levels of participation in WIC; and (11) the ability to develop and market new, innovative products. For additional information on these and other factors, see the risk factors identified in the company’s periodic reports, including the annual report on Form 10-K for 2011, quarterly reports on Form 10-Q and current reports on Form 8-K, filed with, or furnished to, the Securities and Exchange Commission, available upon request or at meadjohnson.com. The company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.

About Mead Johnson

Mead Johnson, a global leader in pediatric nutrition, develops, manufactures, markets and distributes more than 70 products in over 50 markets worldwide. The company’s mission is to nourish the world’s children for the best start in life. The Mead Johnson name has been associated with science-based pediatric nutrition products for over 100 years. The company’s “Enfa” family of brands, including Enfamil ^® infant formula, is the world’s leading brand franchise in pediatric nutrition. For more information, visit meadjohnson.com.

INTERIM CONSOLIDATED FINANCIAL STATEMENTS
MEAD JOHNSON NUTRITION COMPANY
CONSOLIDATED STATEMENTS OF EARNINGS
(Dollars in millions, except per share data)
(UNAUDITED)
		Three Months Ended June 30,								Six Months Ended June 30,
		2012				2011				2012			2011
NET SALES		$	1,012.3			$	932.0			$	1,998.9		$	1,831.8
Cost of Products Sold			372.3				329.1				745.8			649.1
GROSS PROFIT			640.0				602.9				1,253.1			1,182.7
Expenses:
Selling, General and Administrative			221.1				246.6				431.5			460.0
Advertising and Promotion			148.7				131.9				274.5			243.2
Research and Development			23.6				22.2				46.1			41.5
Other Expenses/(Income)—net			(1.7	)			(1.5	)			3.9			11.7
EARNINGS BEFORE INTEREST AND INCOME TAXES			248.3				203.7				497.1			426.3
Interest Expense—net			17.6				12.2				32.1			25.3
EARNINGS BEFORE INCOME TAXES			230.7				191.5				465.0			401.0
Provision for Income Taxes			59.6				56.6				124.1			117.2
NET EARNINGS			171.1				134.9				340.9			283.8
Less Net Earnings Attributable to Noncontrolling Interests			5.3				2.8				10.9			5.6
NET EARNINGS ATTRIBUTABLE TO SHAREHOLDERS		$	165.8			$	132.1			$	330.0		$	278.2
Earnings per Share—Basic
Net Earnings Attributable to Shareholders		$	0.81			$	0.64			$	1.61		$	1.36
Earnings per Share—Diluted
Net Earnings Attributable to Shareholders		$	0.81			$	0.64			$	1.61		$	1.35
Dividends Declared per Share		$	0.30			$	0.26			$	0.60		$	0.52

MEAD JOHNSON NUTRITION COMPANY
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Dollars in millions)
(UNAUDITED)
		Three Months Ended June 30,								Six Months Ended June 30,
		2012				2011				2012				2011
NET EARNINGS		$	171.1			$	134.9			$	340.9			$	283.8
OTHER COMPREHENSIVE INCOME/(LOSSES)
Foreign Currency Translation Adjustments
Translation Adjustments			(52.7	)			3.9				(29.8	)			36.8
Tax Benefit/(Expense)			11.7				(1.2	)			5.3				(5.3	)
Deferred Gains/(Losses) on Derivatives Qualifying as Hedges
Deferred Gains/(Losses) on Derivatives Qualifying as Hedges for the Period			2.3				(2.1	)			(4.1	)			(5.8	)
Reclassification Adjustment for (Gains)/Losses Included in Net Income			0.5				2.0				(0.5	)			3.4
Tax Benefit/(Expense)			(0.8	)			—				1.4				0.7
Pension and Other Post Retirement Benefits
Deferred Gains/(Losses) on Pension and Other Post Retirement Benefits			0.1				0.2				—				—
Reclassification Adjustment for (Gains)/Losses Included in Net Income			10.7				1.3				12.5				2.5
Tax Benefit/(Expense)			(4.0	)			(0.4	)			(3.2	)			(2.7	)
OTHER COMPREHENSIVE INCOME			(32.2	)			3.7				(18.4	)			29.6
COMPREHENSIVE INCOME			138.9				138.6				322.5				313.4
Less Comprehensive Income Attributable to Noncontrolling Interests			5.3				2.8				10.9				5.8
COMPREHENSIVE INCOME ATTRIBUTABLE TO SHAREHOLDERS		$	133.6			$	135.8			$	311.6			$	307.6

MEAD JOHNSON NUTRITION COMPANY
CONSOLIDATED BALANCE SHEETS
(Dollars and shares in millions, except per share data)
(UNAUDITED)
		June 30,				December 31,
		2012				2011
ASSETS
CURRENT ASSETS:
Cash and Cash Equivalents		$	787.3			$	840.3
Receivables—net of allowances of $6.7 and $6.3, respectively			366.2				352.6
Inventories			494.5				534.9
Deferred Income Taxes—net of valuation allowance			115.4				118.5
Income Taxes Receivable			6.2				3.3
Prepaid Expenses and Other Assets			58.1				40.1
Total Current Assets			1,827.7				1,889.7
Property, Plant, and Equipment—net			579.8				576.1
Goodwill			283.9				117.5
Other Intangible Assets—net			143.5				91.6
Deferred Income Taxes—net of valuation allowance			20.1				16.5
Other Assets			104.8				75.4
TOTAL		$	2,959.8			$	2,766.8
LIABILITIES AND EQUITY/(DEFICIT)
CURRENT LIABILITIES:
Accounts Payable		$	441.4			$	488.1
Dividends Payable			61.6				53.3
Note Payable			83.7				—
Accrued Expenses			184.0				229.0
Accrued Rebates and Returns			308.2				300.1
Deferred Income—current			2.7				47.0
Income Taxes—payable and deferred			61.0				82.6
Total Current Liabilities			1,142.6				1,200.1
Long-Term Debt			1,527.5				1,531.9
Deferred Income Taxes—noncurrent			20.6				5.2
Pension, Post Retirement and Post Employment Liabilities			157.2				157.2
Other Liabilities			77.8				40.4
Total Liabilities			2,925.7				2,934.8
COMMITMENTS AND CONTINGENCIES
REDEEMABLE NONCONTROLLING INTEREST			32.3				—
EQUITY/(DEFICIT)
Shareholders’ Equity
Common Stock, $0.01 par value: 3,000 authorized, 205.9 and 205.1 issued, respectively			2.1				2.1
Additional Paid-in/(Distributed) Capital			(695.4	)			(728.4	)
Retained Earnings			975.9				770.0
Treasury Stock—at cost			(148.5	)			(89.7	)
Accumulated Other Comprehensive Income/(Loss)			(151.5	)			(133.1	)
Total Shareholders’ Equity/(Deficit)			(17.4	)			(179.1	)
Noncontrolling Interests			19.2				11.1
Total Equity/(Deficit)			1.8				(168.0	)
TOTAL		$	2,959.8			$	2,766.8

MEAD JOHNSON NUTRITION COMPANY
CONSOLIDATED STATEMENTS OF EQUITY/(DEFICIT)
AND REDEEMABLE NONCONTROLLING INTEREST
(Dollars in millions)
(UNAUDITED)
					Additional												Accumulated												Redeemable
					Paid-in												Other				Non-								Non-
		Common			(Distributed)				Retained				Treasury				Comprehensive				controlling				Total Equity/				controlling
		Stock			Capital				Earnings				Stock				Income (Loss)				Interests				(Deficit)				Interest
BALANCE January 1, 2011		$	2.0		$	(775.6	)		$	474.0			$	(3.2	)		$	(64.6	)		$	9.1			$	(358.3	)		$	—
Stock-based Compensation Awards						23.7								(0.1	)											23.6
Treasury Stock Acquired														(54.1	)											(54.1	)
Distributions to Noncontrolling Interests																						(2.7	)			(2.7	)
Cash Dividends Declared										(106.4	)															(106.4	)
Net Earnings										278.2												5.6				283.8
Other Comprehensive Income																		29.4				0.2				29.6
BALANCE June 30, 2011		$	2.0		$	(751.9	)		$	645.8			$	(57.4	)		$	(35.2	)		$	12.2			$	(184.5	)		$	—
BALANCE January 1, 2012		$	2.1		$	(728.4	)		$	770.0			$	(89.7	)		$	(133.1	)		$	11.1			$	(168.0	)		$	—
Stock-based Compensation Awards						33.0								(14.8	)											18.2
Treasury Stock Acquired														(44.0	)											(44.0	)
Acquisition																										—				30.2
Distributions to Noncontrolling Interests																						(2.2	)			(2.2	)
Cash Dividends Declared										(122.6	)															(122.6	)
Net Earnings										330.0												10.3				340.3				0.6
Redeemable Noncontrolling Interest Accretion										(1.5	)															(1.5	)			1.5
Other Comprehensive Income																		(18.4	)							(18.4	)
BALANCE June 30, 2012		$	2.1		$	(695.4	)		$	975.9			$	(148.5	)		$	(151.5	)		$	19.2			$	1.8			$	32.3

MEAD JOHNSON NUTRITION COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in millions)
(UNAUDITED)
		Six Months Ended June 30,
		2012				2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Earnings		$	340.9			$	283.8
Adjustments to Reconcile Net Earnings to Net Cash Provided by Operating Activities:
Depreciation and Amortization			37.6				37.6
Other			29.9				21.5
Changes in Assets and Liabilities			(137.6	)			(48.8	)
Pension and Other Post Retirement Benefits Contributions			(3.6	)			(2.4	)
Net Cash Provided by Operating Activities			267.2				291.7
CASH FLOWS FROM INVESTING ACTIVITIES:
Payments for Capital Expenditures			(50.0	)			(49.5	)
Proceeds from Sale of Property, Plant and Equipment			0.8				0.6
Acquisition			(106.1	)			—
Net Cash Used in Investing Activities			(155.3	)			(48.9	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Short-term Borrowings			180.0				0.9
Repayments of Short-term Borrowings			(180.0	)			(2.1	)
Payments of Dividends			(114.3	)			(99.3	)
Stock-based-compensation-related Proceeds and Excess Tax Benefits			18.8				2.5
Purchases of Treasury Stock			(58.8	)			(55.4	)
Distributions to Noncontrolling Interests			(2.2	)			(2.7	)
Net Cash Used in Financing Activities			(156.5	)			(156.1	)
Effects of Changes in Exchange Rates on Cash and Cash Equivalents			(8.4	)			21.4
NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS			(53.0	)			108.1
CASH AND CASH EQUIVALENTS:
Beginning of Period			840.3				595.6
End of Period		$	787.3			$	703.7

MEAD JOHNSON NUTRITION COMPANY
SUPPLEMENTAL FINANCIAL INFORMATION
(Dollars in millions)
(UNAUDITED)
													% Change Due to
		Three Months Ended June 30,																	Foreign
		2012				2011				% Change			Volume			Price			Exchange
Net Sales
Asia/Latin America		$	695.2			$	611.6			14	%		7	%		9	%		-2	%
North America/Europe			317.1				320.4			-1	%		-5	%		5	%		-1	%
Total		$	1,012.3			$	932.0			9	%		3	%		8	%		-2	%
Earnings Before Interest and Income Taxes
Asia/Latin America		$	237.5			$	209.8			13	%
North America/Europe			74.6				86.4			-14	%
Corporate and Other			(63.8	)			(92.5	)		31	%
Total		$	248.3			$	203.7			22	%

													% Change Due to
		Six Months Ended June 30,																	Foreign
		2012				2011				% Change			Volume			Price			Exchange
Net Sales
Asia/Latin America		$	1,396.5			$	1,188.5			18	%		11	%		7	%		0	%
North America/Europe			602.4				643.3			-6	%		-9	%		4	%		-1	%
Total		$	1,998.9			$	1,831.8			9	%		4	%		6	%		-1	%
Earnings Before Interest and Income Taxes
Asia/Latin America		$	516.5			$	426.6			21	%
North America/Europe			108.3				179.3			-40	%
Corporate and Other			(127.7	)			(179.6	)		29	%
Total		$	497.1			$	426.3			17	%

Non-GAAP Financial Measures

This news release contains non-GAAP financial measures, including non-GAAP EBIT, earnings and earnings per share information. The items included in GAAP measures, but excluded for the purpose of determining non-GAAP EBIT, earnings and earnings per share, are IT separation and other costs (Specified Items). In addition, other items include the tax impact on Specified Items. Non-GAAP EBIT, earnings and earnings per share information adjusted for these items is an indication of the company’s underlying operating results and intended to enhance an investor’s overall understanding of the company’s financial performance. In addition, this information is among the primary indicators the company uses as a basis for evaluating company performance, setting incentive compensation targets, and planning and forecasting of future periods. This information is not intended to be considered in isolation or as a substitute for financial measures prepared in accordance with GAAP. Tables that reconcile GAAP to non-GAAP disclosure follow:

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