This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Hillshire Brands Reports Full Year Earnings Above Guidance Range; Raises Dividend And Announces Plans To Repurchase Shares

Stocks in this article: HSH

Investors must recognize that actual results may differ from those expressed or implied in the forward-looking statements, and the company wishes to caution readers not to place undue reliance on any forward-looking statements. Among the factors that could cause Hillshire Brands' actual results to differ from such forward-looking statements are those described under Item 1A, Risk Factors, in Hillshire Brands' most recent Annual Report on Form 10-K, as well as factors relating to:

  • Hillshire Brands' spin-off of its international coffee and tea business in June 2012, including (i) Hillshire Brands' ability to generate the anticipated benefits from the spin-off; (ii) the transition of leadership to a new senior management team and the departure of key personnel with historical knowledge; and (iii) potential tax liabilities and other indemnification obligations;
  • The consumer marketplace, such as (i) intense competition, including advertising, promotional and price competition; (ii) changes in consumer behavior due to economic conditions, such as a shift in consumer demand toward private label; (iii) fluctuations in raw material costs, Hillshire Brands' ability to increase or maintain product prices in response to cost fluctuations and the impact on profitability; (iv) the impact of various food safety issues and regulations on sales and profitability of Hillshire Brands' products; and (v) inherent risks in the marketplace associated with product innovations, including uncertainties related to execution and trade and consumer acceptance;
  • Hillshire Brands' relationship with its customers, such as (i) a significant change in Hillshire Brands' business with any of its major customers, such as Wal-Mart, its largest customer; and (ii) credit and other business risks associated with customers operating in a highly competitive retail environment; and
  • Other factors, such as (i) Hillshire Brands' ability to generate margin improvement through cost reduction and productivity improvement initiatives; (ii) Hillshire Brands' credit ratings, the impact of Hillshire Brands' capital plans on such credit ratings and the impact these ratings and changes in these ratings may have on Hillshire Brands' cost to borrow funds and access to capital/debt markets; and (iii) the settlement of a number of ongoing reviews of Hillshire Brands' income tax filing positions and inherent uncertainties related to the interpretation of tax regulations in the jurisdictions in which Hillshire Brands transacts or has transacted business.
 

Consolidated Statements of Income

For the Quarter and Twelve Months ended June 29, 2013 and June 30, 2012 (in millions, except per share data—unaudited)

 
 

Quarter ended

  Twelve Months ended
   
June 29, 2013 June 30, 2012 June 29, 2013 June 30, 2012
Continuing Operations
Net sales $ 962   $ 983   $ 3,920   $ 3,958  
Cost of sales 698 713 2,758 2,857
Selling, general and administrative expenses 213 284 855 930
Net charges for exit activities, asset and business dispositions 2 11 9 81
Impairment charges     1   14  
Operating income 49 (25 ) 297 76
Interest expense 13 10 48 77
Interest income (2 ) (1 ) (7 ) (5 )
Debt extinguishment costs   39     39  
Income (loss) from continuing operations before income taxes 38 (73 ) 256 (35 )
Income tax expense (benefit) 3   (11 ) 72   (15 )
Income (loss) from continuing operations 35   (62 ) 184   (20 )
Discontinued Operations
Income from discontinued operations net of tax expense (benefit) of $(1), $(631), $(8), and $(603) 2 658 15 463
Gain on sale of discontinued operations, net of tax expense of $1, nil, $15, and $367 4   3   53   405  
Net income from discontinued operations 6   661   68   868  
Net income 41 599 252 848
Less: Income from noncontrolling interests, net of tax
Discontinued operations       3  
Net income attributable to Hillshire Brands $ 41   $ 599   $ 252   $ 845  
Amounts attributable to Hillshire Brands
Net income (loss) from continuing operations $ 35 $ (62 ) $ 184 $ (20 )
Net income from discontinued operations 6 661 68 865
Earnings per share of common stock
Basic
Income (loss) from continuing operations $ 0.29 $ (0.52 ) $ 1.50 $ (0.16 )
Net income $ 0.33 $ 5.02 $ 2.05 $ 7.13
Average shares outstanding 123 119 123 119
Diluted
Income (loss) from continuing operations $ 0.28 $ (0.52 ) $ 1.49 $ (0.16 )
Net income $ 0.33 $ 5.02 $ 2.04 $ 7.13
Average shares outstanding 125 119 123 119
Cash dividends declared per share of common stock $ 0.125 $ $ 0.50 $ 1.15
 

Financial Summary—As Adjusted (1)

For the Quarter and Twelve Months ended June 29, 2013 and June 30, 2012 (in millions, except per share data—unaudited)

 
  Quarter ended   Twelve Months ended
June 29,   June 30,   % June 29,   June 30,   %
2013 2012 Change 2013 2012 Change
Continuing operations:
Adjusted net sales:
Retail $ 706 $ 734 (3.8 )% $ 2,894 $ 2,884 0.3 %
Foodservice/Other 256 249 2.7 1,026 1,025 0.1
Intersegment         (6 )  
Total adjusted net sales $ 962   $ 983   (2.1 )% $ 3,920   $ 3,903   0.4 %
Adjusted operating income (loss)
Retail $ 57 $ 85 (32.3 )% $ 329 $ 313 5.5 %
Foodservice/Other 13   14   (13.5 ) 75   79   (5.0 )
Operating segment income 70 99 (29.6 )% 404 392 3.4 %
General corporate expenses (4 ) (15 ) (36 ) (64 )
Mark-to-market derivatives gains (losses) (2 ) (1 ) (1 ) (1 )
Amortization of trademarks & intangibles (1 ) (1 )   (4 ) (4 )  
Total adjusted operating income $ 63   $ 82   (23.2 )% $ 363   $ 323   12.5 %
Adjusted income from continuing operations $ 33   $ 38   (12.8 )% $ 212   $ 173   22.3 %
Adjusted net income $ 35   $ 151   (77.2 )% $ 223   $ 574   (61.1 )%
 
Continuing operations $ 33 $ 38 (12.8 )% $ 212 $ 173 22.3 %
Discontinued operations $ 2   $ 113   (98.5 )% $ 11   $ 398   (97.2 )%
Adjusted net income attributable to Hillshire Brands $ 35   $ 151   (77.2 )% $ 223   $ 571   (60.9 )%
Adjusted diluted earnings per share:
Income from continuing operations $ 0.26   $ 0.31   (16.1 )% $ 1.72   $ 1.45   18.6 %
Net income $ 0.28   $ 1.26   (77.8 )% $ 1.81   $ 4.77   (62.1 )%
Adjusted operating margin:
Retail 8.2 % 11.6 % (3.4) ppt 11.4 % 10.8 % 0.6 ppt
Foodservice/Other 4.8 5.7 (0.9) ppt 7.3 7.7 (0.4) ppt
Total Hillshire Brands 6.6 % 8.4 % (1.8) ppt 9.3 % 8.3 % 1.0 ppt
 

(1) Represents a non-GAAP financial measure. See detailed explanation of these and other non-GAAP measures at end of this release.

 

Financial Summary—As Reported

For the Quarter and Twelve Months ended June 29, 2013 and June 30, 2012 (in millions, except per share data—unaudited)

 
  Quarter ended   Twelve Months ended
June 29,   June 30,   % June 29,   June 30,   %
2013 2012 Change 2013 2012 Change
Continuing operations:
Net sales:
Retail $ 706 $ 734 (3.8 )% $ 2,894 $ 2,884 0.3 %
Foodservice/Other 256 249 2.7 1,026 1,025 0.1
Business dispositions and exits 55
Intersegment         (6 )  
Total net sales $ 962   $ 983   (2.1 )% $ 3,920   $ 3,958   (1.0 )%
Operating income (loss)
Retail $ 57 $ 85 (32.3 )% $ 329 $ 313 5.5 %
Foodservice/Other 13   14   (13.5 ) 75   79   (5.0 )
Operating segment income 70 99 (29.6 )% 404 392 3.4 %
General corporate expenses (10 ) (104 ) (93 ) (272 )
Mark-to-market derivatives gains (losses) (2 ) (1 ) (1 ) (1 )
Amortization of trademarks & intangibles (1 ) (1 ) (4 ) (4 )
Business dispositions and exits 6 8
Significant items - business segments (8 ) (18 )   (15 )   (47 )  
Total operating income (loss) $ 49   $ (25 ) NM $ 297   $ 76   NM
Income (loss) from continuing operations $ 35   $ (62 ) NM $ 184   $ (20 ) NM
Net income $ 41   $ 599   (93.2 )% $ 252   $ 848   (70.3 )%
 
Continuing operations $ 35 $ (62 ) NM $ 184 $ (20 ) NM
Discontinued operations $ 6   $ 661   (99.1 )% $ 68   $ 865   (92.1 )%
Net income (loss) attributable to Hillshire Brands $ 41   $ 599   (93.2 )% $ 252   $ 845   (70.2 )%
Diluted earnings per share:
Income (loss) from continuing operations $ 0.28   $ (0.52 ) NM $ 1.49   $ (0.16 ) NM
Net income $ 0.33   $ 5.02   (93.4 )% $ 2.04   $ 7.13   (71.4 )%
Operating margin:
Retail 8.2 % 11.6 % (3.4) ppt 11.4 % 10.8 % 0.6 ppt
Foodservice/Other 4.8 5.7 (0.9) ppt 7.3 7.7 (0.4) ppt
Total Hillshire Brands 5.1 % (2.5 )% 7.6 ppt 7.6 % 1.9 % 5.7 ppt
 

NM = Not meaningful

 

Net Sales Bridge

For the Quarter and Twelve Months ended June 29, 2013 (unaudited)

 

The following table illustrates the components of the change in net sales versus the prior year

 
    Foodservice/   Total
Fourth quarter ended June 29, 2013 Retail Other Company
Volume (3.6 )% 4.4 % (1.0 )%
Mix 0.3 (3.4 ) (1.2 )
Price (0.4 ) 2.1 0.3
Other (0.1 ) (0.4 )   (0.2 )
Adjusted net sales* change (3.8 ) 2.7 (2.1 )
Dispositions        
Total Net Sales Change (3.8 )% 2.7 % (2.1 )%
Foodservice/ Total
Year ended June 29, 2013 Retail Other Company
Volume (0.1 )% 4.5 % 1.4 %
Mix 0.6 (3.6 ) (0.7 )
Price (0.2 ) (0.4 ) (0.3 )
Other   (0.4 )    
Adjusted net sales* change 0.3 0.1 0.4
Dispositions       (1.4 )
Total Net Sales Change 0.3 % 0.1 % (1.0 )%
 
* Adjusted net sales is a non-GAAP measure that excludes the impact of dispositions.
See detailed explanation of this and other non-GAAP measures in this release.
 

Operating Results by Business Segment

For the Quarters ended June 29, 2013 and June 30, 2012 (in millions—unaudited)

 
  Fourth Quarter   Fourth Quarter
2013 2012
Net sales:
Retail $ 706 $ 734
Foodservice/Other 256 249
Business dispositions and exits
Intersegment  
Total net sales $ 962   $ 983
             
Other
As Restructuring Accelerated Impairment Significant As
Fourth Quarter 2013 Reported Dispositions Actions Depreciation Charges Items

Adjusted (1)

Operating income:
Retail $ 57 $ 57
Foodservice/Other 13   13  
Total operating segment income 70   70  
General corporate expenses (10 ) $ $ (15 ) $ $ $ 9 (4 )
Mark-to-market derivative gains (losses) (2 ) (2 )
Amortization of trademarks/intangibles (1 ) (1 )
Business dispositions and exits
Significant items - business segments (8 )   (3 ) (5 )      
Operating income $ 49   $   $ (18 ) $ (5 ) $   $ 9   $ 63  
Operating margin 5.1 % 6.6 %
Fourth Quarter 2012
Operating income:
Retail $ 85 $ 85
Foodservice/Other 14   14  
Total operating segment income 99   99  
General corporate expenses (104 ) $ $ (76 ) $ (12 ) $ $ (1 ) (15 )
Mark-to-market derivative gains (losses) (1 ) (1 )
Amortization of trademarks/intangibles (1 ) (1 )
Business dispositions and exits
Significant items - business segments (18 )   (8 ) (5 )   (5 )  
Operating income (loss) $ (25 ) $   $ (84 ) $ (17 ) $   $ (6 ) $ 82  
Operating margin (2.5 )% 8.4 %
 

(1) Represents a non-GAAP financial measure. See detailed explanation of these and other non-GAAP measures at end of this release.

 

Operating Results by Business Segment

For the Twelve Months ended June 29, 2013 and June 30, 2012 (in millions—unaudited)

 
  Twelve Months   Twelve Months
2013 2012
Net sales:
Retail $ 2,894 $ 2,884
Foodservice/Other 1,026 1,025
Business dispositions and exits 55
Intersegment   (6 )
Total net sales $ 3,920   $ 3,958  
             
Other
As Restructuring Accelerated Impairment Significant As
Twelve Months 2013 Reported Dispositions Actions Depreciation Charges Items

Adjusted (1)

Operating income:
Retail $ 329 $ 329
Foodservice/Other 75   75  
Total operating segment income 404   404  
General corporate expenses (93 ) $ $ (51 ) $ (18 ) $ $ 12 (36 )
Mark-to-market derivative gains (losses) (1 ) (1 )
Amortization of trademarks/intangibles (4 ) (4 )
Business dispositions and exits 6 6
Significant items - business segments (15 )   (3 ) (11 ) (1 )    
Operating income $ 297   $ 6   $ (54 ) $ (29 ) $ (1 ) $ 12   $ 363  
Operating margin 7.6 % 9.3 %
Twelve Months 2012
Operating income:
Retail $ 313 $ 313
Foodservice/Other 79   79  
Total operating segment income 392   392  
General corporate expenses (272 ) $ $ (178 ) $ (22 ) $ (14 ) $ 6 (64 )
Mark-to-market derivative gains (losses) (1 ) (1 )
Amortization of trademarks/intangibles (4 ) (4 )
Business dispositions and exits 8 8
Significant items - business segments (47 )   (18 ) (24 )   (5 )  
Operating income $ 76   $ 8   $ (196 ) $ (46 ) $ (14 ) $ 1   $ 323  
Operating margin 1.9 % 8.3 %
 

(1) Represents a non-GAAP financial measure. See detailed explanation of these and other non-GAAP measures at end of this release.

 

Significant Items

Quarters ended June 29, 2013 and June 30, 2012 (in millions, except per share data—unaudited)

 
  Quarter ended June 29, 2013   Quarter ended June 30, 2012
    Diluted     Diluted
Pretax Net EPS Pretax Net EPS
(In millions except per share data) Impact Income/(loss)

Impact (1)

Impact Income/(loss)

Impact (1)

Continuing Operations:
Restructuring actions:
Severance/ retention costs $ (3 ) $ (1 ) $ (0.02 ) $ (11 ) $ (7 ) $ (0.06 )
Lease and contractual obligation exit costs 1 0.01 (2 ) (1 ) (0.01 )
Consulting/advisory and other costs (16 ) (11 ) (0.08 ) (71 ) (49 ) (0.41 )
Accelerated depreciation (5 ) (3 ) (0.03 ) (17 ) (11 ) (0.09 )
Total restructuring actions (23 ) (15 ) (0.12 ) (101 ) (68 ) (0.56 )
Pension settlement/withdrawal/other (1 ) (0.01 ) (6 ) (4 ) (0.03 )
Tax indemnification accrual adjustment 10 10 0.08
Debt extinguishment costs       (39 ) (25 ) (0.21 )
Impact of significant items on income (loss) from continuing operations before significant tax matters (14 ) (5 ) (0.04 ) (146 ) (97 ) (0.80 )
Tax audit settlement/reserve adjustments   7   0.06     (3 ) (0.03 )
Impact of significant items on income (loss) from continuing operations (14 ) 2   0.02   (146 ) (100 ) (0.83 )
Discontinued operations:
Severance/ retention costs (29 ) (23 ) (0.19 )
Lease and contractual obligation exit costs (2 ) 1 0.01
Consulting, advisory & other costs (67 ) (53 ) (0.44 )
Impairment charges (10 ) (7 ) (0.06 )
Gain on the sale of discontinued operations 5 4 0.03 3 3 0.02
Pension curtailment/withdrawal/other (3 ) (1 ) (0.01 )
Indirect tax reserve - Brazil (1 ) (1 ) (0.01 )
Tax basis difference adjustment 0.01
Tax audit settlement/reserve adjustment (25 ) (0.21 )
Tax valuation allowance adjustment 6 0.05
Tax on unremitted earnings         648   5.37  
Impact of significant items on income (loss) from discontinued operations 5 4 0.03 (109 ) 548 4.54
Impact of using diluted versus basic shares           0.05  
Impact of significant items on net income (loss) attributable to Hillshire Brands $ (9 ) $ 6   $ 0.05   $ (255 ) $ 448   $ 3.76  
 
Impact of significant items on income from continuing operations before income taxes
Cost of sales $ (5 ) $ (10 )
Selling, general and administrative expenses (7 ) (86 )
Exit and business dispositions (2 ) (11 )
Debt extinguishment costs   (39 )
Total $ (14 ) $ (146 )
 
Notes:
(1) EPS amounts are rounded to the nearest $0.01 and may not add to the total.
 

Significant Items

Twelve Months ended June 29, 2013 and June 30, 2012 (in millions, except per share data—unaudited)

 
 

Twelve Months Ended June 29, 2013

 

Twelve Months Ended June 30, 2012

  Net   Diluted   Net   Diluted
Pretax Income/ EPS Pretax Income/ EPS
(In millions except per share data) Impact (loss)

Impact (1)

Impact (loss)

Impact (1)

Continuing Operations:
Restructuring actions:
Severance/ retention costs $ (4 ) $ (2 ) $ (0.02 ) $ (31 ) $ (20 ) $ (0.17 )
Lease and contractual obligation exit costs (12 ) (8 ) (0.06 ) (55 ) (35 ) (0.29 )
Consulting/advisory and other costs (38 ) (25 ) (0.20 ) (110 ) (84 ) (0.70 )
Income from asset dispositions 6 4 0.03
Accelerated depreciation (29 ) (18 ) (0.15 ) (46 ) (29 ) (0.25 )
Total restructuring actions (77 ) (49 ) (0.40 ) (242 ) (168 ) (1.40 )
Gain on HBI tax settlement 15 15 0.12
Impairment charges (1 ) (1 ) (0.01 ) (14 ) (9 ) (0.07 )
Litigation accrual (11 ) (7 ) (0.06 )
Pension settlement/withdrawal/other (5 ) (3 ) (0.03 ) (6 ) (4 ) (0.03 )
Tax indemnification accrual adjustment 10 10 0.08 3 4 0.03
Workers' compensation deposit adjustment 7 5 0.04
Debt extinguishment costs       (39 ) (25 ) (0.21 )
Impact of significant items on income (loss) from continuing operations before significant tax matters (66 ) (38 ) (0.31 ) (294 ) (194 ) (1.62 )
Tax audit settlement/reserve adjustments   10   0.09     1   0.01  
Impact of significant items on income (loss) from continuing operations (66 ) (28 ) (0.23 ) (294 ) (193 ) (1.61 )
Discontinued operations:
Severance/ retention costs (73 ) (55 ) (0.46 )
Lease and contractual obligation exit costs (108 ) (79 ) (0.66 )
Consulting, advisory & other costs (3 ) (2 ) (0.02 ) (145 ) (105 ) (0.87 )
Impairment charges (414 ) (365 ) (3.05 )
Gain on the sale of discontinued operations 68 53 0.43 772 405 3.38
Thailand flood loss (2 ) (1 ) (0.01 )
Pension curtailment/withdrawal/other 1 1 (6 ) (3 ) (0.02 )
Indirect tax reserve - Brazil (1 ) (1 ) (0.01 )
Tax basis difference adjustment 4 0.03 186 1.56
Tax audit settlement/reserve adjustments 1 0.01 80 0.67
Tax valuation allowance adjustment (66 ) (0.55 )
Tax on unremitted earnings         471   3.94  
Impact of significant items on income from discontinued operations 66 57 0.46 23 467 3.90
Impact of using diluted versus basic shares           0.07  
Impact of significant items on net income (loss) attributable to Hillshire Brands $   $ 29   $ 0.23   $ (271 ) $ 274   $ 2.36  
 
Impact of significant items on income from continuing operations before income taxes
Cost of sales $ (11 ) $ (28 )
Selling, general and administrative expenses (45 ) (132 )
Impairment charges (1 ) (14 )
Exit and business dispositions (9 ) (81 )
Debt extinguishment costs   (39 )
Total $ (66 ) $ (294 )
 
Notes:
(1) EPS amounts are rounded to the nearest $0.01 and may not add to the total.
 

EPS Reconciliation—Reported to Adjusted

Quarters ended June 29, 2013 and June 30, 2012 (in millions, except per share data—unaudited)

 
  Quarter ended June 29, 2013   Quarter ended June 30, 2012
  Impact of     Impact of  
As Significant As Significant
Reported Items

Adjusted (1)

Reported Items

Adjusted (1)

Continuing operations:
Income (loss) from continuing operations before income taxes $ 38 $ (14 ) $ 52 $ (73 ) $ (146 ) $ 73
Income tax expense (benefit) 3   (16 ) 19   (11 ) (46 ) 35  
Income (loss) from continuing operations 35   2   33   (62 ) (100 ) 38  
Discontinued operations:
Income from discontinued operations, net of tax 2 2 658 545 113
Gain on sale of discontinued operations, net of tax 4   4     3   3    
Net income from discontinued operations 6   4   2   661   548   113  
Net income 41 6 35 599 448 151
Less: Income from noncontrolling interests, net of tax
Discontinued operations            
Net income attributable to Hillshire Brands $ 41   $ 6   $ 35   $ 599   $ 448   $ 151  
Amounts attributable to Hillshire Brands:
Net income (loss) from continuing operations $ 35 $ 2 $ 33 $ (62 ) $ (100 ) $ 38
Net income from discontinued operations 6 4 2 661 548 113
Earnings per share of common stock:
Diluted
Income (loss) from continuing operations $ 0.28 $ 0.02 $ 0.26 $ (0.52 ) $ (0.83 ) $ 0.31
Net income $ 0.33 $ 0.05 $ 0.28 $ 5.02 $ 3.76 $ 1.26
Effective tax rate—continuing operations 7.7 % 37.4 % 15.0 % 48.4 %
 

(1) Represents a non-GAAP financial measure. See detailed explanation of these and other non-GAAP measures at end of this release

 

EPS Reconciliation—Reported to Adjusted

Twelve Months ended June 29, 2013 and June 30, 2012 (in millions, except per share data—unaudited)

 
 

Twelve Months Ended June 29, 2013

  Twelve Months Ended June 30, 2012
  Impact of     Impact of  
As Significant As Significant
Reported Items

Adjusted (1)

Reported Items

Adjusted (1)

Continuing operations:
Income (loss) from continuing operations before income taxes $ 256 $ (66 ) $ 322 $ (35 ) $ (294 ) $ 259
Income tax expense (benefit) 72   (38 ) 110   (15 ) (101 ) 86  
Income (loss) from continuing operations 184   (28 ) 212   (20 ) (193 ) 173  
Discontinued operations:
Income from discontinued operations, net of tax 15 4 11 463 62 401
Gain on sale of discontinued operations, net of tax 53   53     405   405    
Net income from discontinued operations 68   57   11   868   467   401  
Net income 252 29 223 848 274 574
Less: Income from noncontrolling interests, net of tax
Discontinued operations       3     3  
Net income attributable to Hillshire Brands $ 252   $ 29   $ 223   $ 845   $ 274   $ 571  
Amounts attributable to Hillshire Brands:
Net (loss) income from continuing operations $ 184 $ (28 ) $ 212 $ (20 ) $ (193 ) $ 173
Net income from discontinued operations 68 57 11 865 467 398
Earnings per share of common stock:
Diluted
Income (loss) from continuing operations $ 1.49 $ (0.23 ) $ 1.72 $ (0.16 ) $ (1.61 ) $ 1.45
Net income $ 2.04 $ 0.23 $ 1.81 $ 7.13 $ 2.36 $ 4.77
Effective tax rate—continuing operations 28.1 % 34.2 % 44.2 % 33.1 %
 

(1) Represents a non-GAAP financial measure. See detailed explanation of these and other non-GAAP measures at end of this release.

 

Operating Income Reconciliation—Reported to Adjusted

Quarters ended June 29, 2013 and June 30, 2012 (in millions, except per share data—unaudited)

 
  Quarter ended June 29, 2013
  Impact of    
As Significant
Reported Items Dispositions

Adjusted (1)

Net Sales $ 962 $ $ $ 962
Cost of Sales 698   5     693
Gross Profit 264   (5 )   269
MAP Expense 47 47
SG&A (excluding MAP) 166 7 159
Net charges for exit activities, asset and business dispositions 2 2
Impairment charges      
Operating income $ 49   $ (14 ) $   $ 63
 
Quarter ended June 30, 2012
Impact of
As Significant
Reported Items Dispositions

Adjusted (1)

Net Sales $ 983 $ $ $ 983
Cost of Sales 713   10   1   702
Gross Profit 270   (10 ) (1 ) 281
MAP Expense 26 (2 ) 28
SG&A (excluding MAP) 258 86 1 171
Net charges for exit activities, asset and business dispositions 11 11
Impairment charges      
Operating income (loss) $ (25 ) $ (107 ) $   $ 82
 

(1) Represents a non-GAAP financial measure. See detailed explanation of these and other non-GAAP measures at end of this release.

 

Operating Income Reconciliation—Reported to Adjusted

Twelve Months ended June 29, 2013 and June 30, 2012 (in millions, except per share data—unaudited)

 
  Twelve Months ended June 29, 2013
  Impact of    
As Significant
Reported Items Dispositions

Adjusted (1)

Net Sales $ 3,920 $ $ $ 3,920
Cost of Sales 2,758   11     2,747
Gross Profit 1,162   (11 )   1,173
MAP Expense 174 174
SG&A (excluding MAP) 681 45 636
Net charges for exit activities, asset and business dispositions 9 9
Impairment charges 1   1    
Operating income $ 297   $ (66 ) $   $ 363
 
Twelve Months Ended June 30, 2012
Impact of
As Significant
Reported Items Dispositions

Adjusted (1)

Net Sales $ 3,958 $ $ 55 $ 3,903
Cost of Sales 2,857   28   40   2,789
Gross Profit 1,101   (28 ) 15   1,114
MAP Expense 135 135
SG&A (excluding MAP) 795 132 7 656
Net charges for exit activities, asset and business dispositions 81 81
Impairment charges 14   14    
Operating income $ 76   $ (255 ) $ 8   $ 323
 

(1) Represents a non-GAAP financial measure. See detailed explanation of these and other non-GAAP measures at end of this release.

4 of 7

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs