Segments

The Company’s segments are primarily organized by geographical area. The composition of segments and measure of segment profitability are consistent with that used by the Company’s management.

Descriptions of the Company’s reportable segments are as follows:

North American Consumer Products—This segment primarily manufactures, markets and sells ketchup, condiments, sauces, pasta meals, and frozen potatoes, entrees, snacks, and appetizers to the grocery channels in the United States of America and includes our Canadian business.

Europe—This segment includes the Company’s operations in Europe and sells products in all of the Company’s categories.

Asia/Pacific—This segment includes the Company’s operations in Australia, New Zealand, India, Japan, China, Papua New Guinea, South Korea, Indonesia, Vietnam and Singapore. This segment’s operations include products in all of the Company’s categories.

U.S. Foodservice—This segment primarily manufactures, markets and sells branded and customized products to commercial and non-commercial food outlets and distributors in the United States of America including ketchup, condiments, sauces and frozen soups.

Rest of World—This segment includes the Company’s operations in Africa, Latin America, and the Middle East that sell products in all of the Company’s categories.

The Company’s management evaluates performance based on several factors including net sales, operating income, and the use of capital resources. Inter-segment revenues, items below the operating income line of the consolidated statements of income and certain costs associated with Fiscal 2014 Restructuring and Productivity Initiatives (see Note 4) and Merger related costs, are not presented by segment, since they are not reflected in the measure of segment profitability reviewed by the Company’s management.

The following table presents information about the Company’s reportable segments:



	Second Quarter Ended
	Successor			Predecessor
	October 27, 2013 FY 2014			October 28, 2012 FY 2013
	(In thousands)
Net external sales:
North American Consumer Products	$	747,724		$	794,957
Europe	782,573			808,427
Asia/Pacific	561,505			600,607
U.S. Foodservice	346,487			348,028
Rest of World	279,047			269,515
Consolidated Totals	$	2,717,336		$	2,821,534
Operating income/(loss):
North American Consumer Products(a)	$	184,390		$	190,341
Europe(a)	116,812			140,398
Asia/Pacific(a)	9,838			53,818
U.S. Foodservice(a)	57,097			44,223
Rest of World(a)	39,265			27,094
Other:
Non-Operating(b)	(29,409		)	(60,143		)
Special Items(c)	(206,200		)	—
Consolidated Totals	$	171,793		$	395,731



	Successor			Predecessor
	February 8 - October 27, 2013 FY 2014			April 29 - June 7, 2013 FY 2014			Six Months Ended October 28, 2012 FY 2013
	(In thousands)
Net external sales:
North American Consumer Products	$	1,144,475		$	307,972		$	1,553,809
Europe	1,225,154			284,657			1,586,343
Asia/Pacific	927,134			272,116			1,250,766
U.S. Foodservice	516,394			135,688			663,374
Rest of World	430,684			112,439			550,692
Consolidated Totals	$	4,243,841		$	1,112,872		$	5,604,984
Operating income/(loss):
North American Consumer Products(a)	$	145,446		$	65,459		$	373,772
Europe(a)	91,759			32,918			277,592
Asia/Pacific(a)	(1,195		)	37,616			132,705
U.S. Foodservice(a)	37,674			15,531			80,873
Rest of World(a)	49,289			10,559			58,107
Other:
Non-Operating(b)	(43,064		)	(16,070		)	(110,922		)
Special Items(c)	(358,734		)	(118,230		)	—
Consolidated Totals	$	(78,825	)	$	27,783		$	812,127

______________________________________

(a)

The negative impact of the inventory step-up adjustment recorded in purchase accounting to operating income in the Successor period was $139.8 million and $0.0 million for North American Consumer Products, $110.3 million and $4.7 million for Europe, $89.6 million and $31.1 million for Asia/Pacific, $33.8 million and $0.0 million for U.S. Foodservice and $9.8 million and $2.5 million for Rest of World for the six and three months ended October 27, 2013, respectively.


(b)	Includes corporate overhead, intercompany eliminations and charges not directly attributable to operating segments.


(c)	Includes costs related to Fiscal 2014 Restructuring and Productivity Initiatives and Merger related costs including legal, accounting and other professional fees as well as severance and employee benefit costs.

The Company’s revenues are generated via the sale of products in the following categories:



	Second Quarter Ended
	Successor		Predecessor
	October 27, 2013 FY 2014		October 28, 2012 FY 2013
	(In thousands)
Ketchup and Sauces	$	1,330,635	$	1,315,116
Meals and Snacks	968,823		1,067,216
Infant/Nutrition	272,965		285,254
Other	144,913		153,948
Total	$	2,717,336	$	2,821,534



	Successor		Predecessor
	February 8 - October 27, 2013 FY 2014		April 29 - June 7, 2013 FY 2014		Six Months Ended October 28, 2012 FY 2013
	(In thousands)
Ketchup and Sauces	$	2,103,758	$	533,932	$	2,634,416
Meals and Snacks	1,461,004		359,412		2,030,095
Infant/Nutrition	438,380		118,528		581,971
Other	240,699		101,000		358,502
Total	$	4,243,841	$	1,112,872	$	5,604,984