x | 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 |
State of Incorporation—Delaware | IRS Employer Identification No.38-0710690 |
Large accelerated filer x | Accelerated filer ¨ | Non-accelerated filer ¨ | Smaller reporting company ¨ |
Page | |
Financial Statements | |
Management’s Discussion and Analysis of Financial Condition and Results of Operations | |
Quantitative and Qualitative Disclosures about Market Risk | |
Controls and Procedures | |
Risk Factors | |
Unregistered Sales of Equity Securities and Use of Proceeds | |
Exhibits | |
July 2, 2016 (unaudited) | January 2, 2016 * | |||||
Current assets | ||||||
Cash and cash equivalents | $ | 531 | $ | 251 | ||
Accounts receivable, net | 1,473 | 1,344 | ||||
Inventories: | ||||||
Raw materials and supplies | 322 | 315 | ||||
Finished goods and materials in process | 894 | 935 | ||||
Deferred income taxes | — | 227 | ||||
Other prepaid assets | 201 | 164 | ||||
Total current assets | 3,421 | 3,236 | ||||
Property, net of accumulated depreciation of $5,310 and $5,236 | 3,543 | 3,621 | ||||
Investments in unconsolidated entities | 435 | 456 | ||||
Goodwill | 4,963 | 4,968 | ||||
Other intangibles, net of accumulated amortization of $51 and $47 | 2,282 | 2,268 | ||||
Pension | 246 | 231 | ||||
Other assets | 497 | 471 | ||||
Total assets | $ | 15,387 | $ | 15,251 | ||
Current liabilities | ||||||
Current maturities of long-term debt | $ | 1,144 | $ | 1,266 | ||
Notes payable | 780 | 1,204 | ||||
Accounts payable | 1,988 | 1,907 | ||||
Accrued advertising and promotion | 464 | 447 | ||||
Accrued income taxes | 83 | 42 | ||||
Accrued salaries and wages | 238 | 325 | ||||
Other current liabilities | 574 | 548 | ||||
Total current liabilities | 5,271 | 5,739 | ||||
Long-term debt | 6,277 | 5,275 | ||||
Deferred income taxes | 477 | 685 | ||||
Pension liability | 922 | 946 | ||||
Nonpension postretirement benefits | 58 | 77 | ||||
Other liabilities | 382 | 391 | ||||
Commitments and contingencies | ||||||
Equity | ||||||
Common stock, $.25 par value | 105 | 105 | ||||
Capital in excess of par value | 770 | 745 | ||||
Retained earnings | 6,701 | 6,597 | ||||
Treasury stock, at cost | (4,092 | ) | (3,943 | ) | ||
Accumulated other comprehensive income (loss) | (1,494 | ) | (1,376 | ) | ||
Total Kellogg Company equity | 1,990 | 2,128 | ||||
Noncontrolling interests | 10 | 10 | ||||
Total equity | 2,000 | 2,138 | ||||
Total liabilities and equity | $ | 15,387 | $ | 15,251 |
Quarter ended | Year-to-date period ended | ||||||||||||
(Results are unaudited) | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | |||||||||
Net sales | $ | 3,268 | $ | 3,498 | $ | 6,663 | $ | 7,054 | |||||
Cost of goods sold | 1,998 | 2,257 | 4,148 | 4,568 | |||||||||
Selling, general and administrative expense | 821 | 829 | 1,628 | 1,690 | |||||||||
Operating profit | 449 | 412 | 887 | 796 | |||||||||
Interest expense | 68 | 58 | 285 | 112 | |||||||||
Other income (expense), net | 4 | (46 | ) | 4 | (72 | ) | |||||||
Income before income taxes | 385 | 308 | 606 | 612 | |||||||||
Income taxes | 106 | 85 | 153 | 161 | |||||||||
Earnings (loss) from unconsolidated entities | 1 | (1 | ) | 2 | (2 | ) | |||||||
Net income | $ | 280 | $ | 222 | $ | 455 | $ | 449 | |||||
Net income (loss) attributable to noncontrolling interests | — | (1 | ) | — | (1 | ) | |||||||
Net income attributable to Kellogg Company | $ | 280 | $ | 223 | $ | 455 | $ | 450 | |||||
Per share amounts: | |||||||||||||
Basic | $ | 0.80 | $ | 0.63 | $ | 1.30 | $ | 1.27 | |||||
Diluted | $ | 0.79 | $ | 0.63 | $ | 1.29 | $ | 1.26 | |||||
Dividends per share | $ | 0.50 | $ | 0.49 | $ | 1.00 | $ | 0.98 | |||||
Average shares outstanding: | |||||||||||||
Basic | 350 | 353 | 350 | 354 | |||||||||
Diluted | 354 | 355 | 354 | 356 | |||||||||
Actual shares outstanding at period end | 349 | 353 |
Quarter ended July 2, 2016 | Year-to-date period ended July 2, 2016 | ||||||||||||||||||
(Results are unaudited) | Pre-tax amount | Tax (expense) benefit | After-tax amount | Pre-tax amount | Tax (expense) benefit | After-tax amount | |||||||||||||
Net income | $ | 280 | $ | 455 | |||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||
Foreign currency translation adjustments | (48 | ) | (16 | ) | (64 | ) | (103 | ) | 13 | (90 | ) | ||||||||
Cash flow hedges: | |||||||||||||||||||
Unrealized gain (loss) on cash flow hedges | (3 | ) | 1 | (2 | ) | (60 | ) | 24 | (36 | ) | |||||||||
Reclassification to net income | 6 | (2 | ) | 4 | 8 | (3 | ) | 5 | |||||||||||
Postretirement and postemployment benefits: | |||||||||||||||||||
Amount arising during the period: | |||||||||||||||||||
Prior service cost | (1 | ) | — | (1 | ) | (1 | ) | — | (1 | ) | |||||||||
Reclassification to net income: | |||||||||||||||||||
Net experience loss | 1 | — | 1 | 2 | — | 2 | |||||||||||||
Prior service cost | 2 | 2 | 2 | 2 | |||||||||||||||
Other comprehensive income (loss) | $ | (43 | ) | $ | (17 | ) | $ | (60 | ) | $ | (152 | ) | $ | 34 | $ | (118 | ) | ||
Comprehensive income | $ | 220 | $ | 337 | |||||||||||||||
Comprehensive income attributable to Kellogg Company | $ | 220 | $ | 337 | |||||||||||||||
Quarter ended July 4, 2015 | Year-to-date period ended July 4, 2015 | ||||||||||||||||||
(Results are unaudited) | Pre-tax amount | Tax (expense) benefit | After-tax amount | Pre-tax amount | Tax (expense) benefit | After-tax amount | |||||||||||||
Net income | $ | 222 | $ | 449 | |||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||
Foreign currency translation adjustments | 9 | 5 | 14 | (54 | ) | (16 | ) | (70 | ) | ||||||||||
Cash flow hedges: | |||||||||||||||||||
Unrealized gain (loss) on cash flow hedges | (4 | ) | — | (4 | ) | 4 | (1 | ) | 3 | ||||||||||
Reclassification to net income | (3 | ) | — | (3 | ) | (7 | ) | — | (7 | ) | |||||||||
Postretirement and postemployment benefits: | |||||||||||||||||||
Amount arising during the period: | |||||||||||||||||||
Prior service credit (cost) | 1 | — | 1 | — | — | — | |||||||||||||
Reclassification to net income: | |||||||||||||||||||
Net experience loss | 1 | — | 1 | 2 | — | 2 | |||||||||||||
Prior service cost | 2 | (1 | ) | 1 | 5 | (2 | ) | 3 | |||||||||||
Other comprehensive income (loss) | $ | 6 | $ | 4 | $ | 10 | $ | (50 | ) | $ | (19 | ) | $ | (69 | ) | ||||
Comprehensive income | $ | 232 | $ | 380 | |||||||||||||||
Net Income (loss) attributable to noncontrolling interest | (1 | ) | (1 | ) | |||||||||||||||
Other comprehensive income (loss) attributable to noncontrolling interests | — | (1 | ) | ||||||||||||||||
Comprehensive income attributable to Kellogg Company | $ | 233 | $ | 382 |
Common stock | Capital in excess of par value | Retained earnings | Treasury stock | Accumulated other comprehensive income (loss) | Total Kellogg Company equity | Non-controlling interests | Total equity | |||||||||||||||||||||
(unaudited) | shares | amount | shares | amount | ||||||||||||||||||||||||
Balance, January 3, 2015 | 420 | $ | 105 | $ | 678 | $ | 6,689 | 64 | $ | (3,470 | ) | $ | (1,213 | ) | $ | 2,789 | $ | 62 | $ | 2,851 | ||||||||
Common stock repurchases | 11 | (731 | ) | (731 | ) | (731 | ) | |||||||||||||||||||||
Net income | 614 | 614 | 614 | |||||||||||||||||||||||||
Acquisition of noncontrolling interest, net | 7 | 7 | ||||||||||||||||||||||||||
VIE deconsolidation | (58 | ) | (58 | ) | ||||||||||||||||||||||||
Dividends | (700 | ) | (700 | ) | (700 | ) | ||||||||||||||||||||||
Other comprehensive loss | (163 | ) | (163 | ) | (1 | ) | (164 | ) | ||||||||||||||||||||
Stock compensation | 51 | 51 | 51 | |||||||||||||||||||||||||
Stock options exercised and other | 16 | (6 | ) | (5 | ) | 258 | 268 | 268 | ||||||||||||||||||||
Balance, January 2, 2016 | 420 | $ | 105 | $ | 745 | $ | 6,597 | 70 | $ | (3,943 | ) | $ | (1,376 | ) | $ | 2,128 | $ | 10 | $ | 2,138 | ||||||||
Common stock repurchases | 5 | (386 | ) | (386 | ) | (386 | ) | |||||||||||||||||||||
Net income | 455 | 455 | 455 | |||||||||||||||||||||||||
Dividends | (351 | ) | (351 | ) | (351 | ) | ||||||||||||||||||||||
Other comprehensive loss | (118 | ) | (118 | ) | (118 | ) | ||||||||||||||||||||||
Stock compensation | 30 | 30 | 30 | |||||||||||||||||||||||||
Stock options exercised and other | (5 | ) | (4 | ) | 237 | 232 | 232 | |||||||||||||||||||||
Balance, July 2, 2016 | 420 | $ | 105 | $ | 770 | $ | 6,701 | 71 | $ | (4,092 | ) | $ | (1,494 | ) | $ | 1,990 | $ | 10 | $ | 2,000 |
Year-to-date period ended | ||||||
(unaudited) | July 2, 2016 | July 4, 2015 | ||||
Operating activities | ||||||
Net income | $ | 455 | $ | 449 | ||
Adjustments to reconcile net income to operating cash flows: | ||||||
Depreciation and amortization | 251 | 269 | ||||
Postretirement benefit plan expense (benefit) | (56 | ) | (41 | ) | ||
Deferred income taxes | 7 | (11 | ) | |||
Stock compensation | 30 | 21 | ||||
Venezuela remeasurement | 11 | 152 | ||||
Variable-interest entity impairment | — | (49 | ) | |||
Other | — | 35 | ||||
Postretirement benefit plan contributions | (23 | ) | (17 | ) | ||
Changes in operating assets and liabilities, net of acquisitions: | ||||||
Trade receivables | (159 | ) | (207 | ) | ||
Inventories | 17 | 5 | ||||
Accounts payable | 157 | 154 | ||||
Accrued income taxes | 54 | (34 | ) | |||
Accrued interest expense | (2 | ) | (2 | ) | ||
Accrued and prepaid advertising and promotion | 10 | 9 | ||||
Accrued salaries and wages | (87 | ) | (61 | ) | ||
All other current assets and liabilities | (17 | ) | (91 | ) | ||
Net cash provided by (used in) operating activities | 648 | 581 | ||||
Investing activities | ||||||
Additions to properties | (249 | ) | (258 | ) | ||
Acquisitions, net of cash acquired | (15 | ) | (117 | ) | ||
Investments in unconsolidated entities, net proceeds | 29 | — | ||||
Other | (15 | ) | 42 | |||
Net cash provided by (used in) investing activities | (250 | ) | (333 | ) | ||
Financing activities | ||||||
Net issuances (reductions) of notes payable | (424 | ) | 114 | |||
Issuances of long-term debt | 2,061 | 672 | ||||
Reductions of long-term debt | (1,227 | ) | (606 | ) | ||
Net issuances of common stock | 233 | 90 | ||||
Common stock repurchases | (386 | ) | (285 | ) | ||
Cash dividends | (351 | ) | (347 | ) | ||
Other | — | 5 | ||||
Net cash provided by (used in) financing activities | (94 | ) | (357 | ) | ||
Effect of exchange rate changes on cash and cash equivalents | (24 | ) | (40 | ) | ||
Increase (decrease) in cash and cash equivalents | 280 | (149 | ) | |||
Cash and cash equivalents at beginning of period | 251 | 443 | ||||
Cash and cash equivalents at end of period | $ | 531 | $ | 294 | ||
Supplemental cash flow disclosures | ||||||
Interest paid | $ | 284 | $ | 114 | ||
Income taxes paid | $ | 85 | $ | 240 | ||
Supplemental cash flow disclosures of non-cash investing activities: | ||||||
Additions to properties included in accounts payable* | $ | 89 | $ | 96 |
• | Excess tax benefits and deficiencies for share-based payments are recorded as an adjustment of income taxes and reflected in operating cash flows after adoption of this ASU. Excess tax benefits and deficiencies were previously recorded in equity and as financing cash flows prior to adoption of this ASU. |
• | The guidance allows the employer to withhold up to the maximum statutory tax rates in the applicable jurisdictions without triggering liability accounting. The Company's accounting treatment of outstanding equity awards was not impacted by its adoption of this provision of the ASU. |
• | The guidance allows for a policy election to account for forfeitures as they occur rather than on an estimated basis. The Company is not making this election, and will continue to account for forfeitures on an estimated basis. |
(millions) | U.S. Morning Foods | U.S. Snacks | U.S. Specialty | North America Other | Europe | Latin America | Asia Pacific | Consoli- dated | ||||||||||||||||
January 2, 2016 | $ | 131 | $ | 3,568 | $ | 82 | $ | 456 | $ | 431 | $ | 76 | $ | 224 | $ | 4,968 | ||||||||
Currency translation adjustment | — | — | — | 3 | (8 | ) | (1 | ) | 1 | (5 | ) | |||||||||||||
July 2, 2016 | $ | 131 | $ | 3,568 | $ | 82 | $ | 459 | $ | 423 | $ | 75 | $ | 225 | $ | 4,963 |
Gross carrying amount | U.S. Morning Foods | U.S. Snacks | U.S. Specialty | North America Other | Europe | Latin America | Asia Pacific | Consoli- dated | ||||||||||||||||
January 2, 2016 | $ | 8 | $ | 42 | $ | — | $ | 5 | $ | 45 | $ | 6 | $ | 10 | $ | 116 | ||||||||
Currency translation adjustment | — | — | — | — | — | — | — | — | ||||||||||||||||
July 2, 2016 | $ | 8 | $ | 42 | $ | — | $ | 5 | $ | 45 | $ | 6 | $ | 10 | $ | 116 | ||||||||
Accumulated Amortization | ||||||||||||||||||||||||
January 2, 2016 | $ | 8 | $ | 16 | $ | — | $ | 4 | $ | 11 | $ | 6 | $ | 2 | $ | 47 | ||||||||
Amortization | — | 2 | — | — | 2 | — | — | 4 | ||||||||||||||||
July 2, 2016 | $ | 8 | $ | 18 | $ | — | $ | 4 | $ | 13 | $ | 6 | $ | 2 | $ | 51 | ||||||||
Intangible assets subject to amortization, net | ||||||||||||||||||||||||
January 2, 2016 | $ | — | $ | 26 | $ | — | $ | 1 | $ | 34 | $ | — | $ | 8 | $ | 69 | ||||||||
Currency translation adjustment | — | — | — | — | — | — | — | — | ||||||||||||||||
Amortization | — | (2 | ) | — | — | (2 | ) | — | — | (4 | ) | |||||||||||||
July 2, 2016 | $ | — | $ | 24 | $ | — | $ | 1 | $ | 32 | $ | — | $ | 8 | $ | 65 |
(millions) | U.S. Morning Foods | U.S. Snacks | U.S. Specialty | North America Other | Europe | Latin America | Asia Pacific | Consoli- dated | ||||||||||||||||
January 2, 2016 | $ | — | $ | 1,625 | $ | — | $ | 158 | $ | 416 | $ | — | $ | — | $ | 2,199 | ||||||||
Additions | — | — | — | 18 | — | — | — | 18 | ||||||||||||||||
Contribution to joint venture | — | — | — | — | (5 | ) | — | — | (5 | ) | ||||||||||||||
Currency translation adjustment | — | — | — | 1 | 4 | — | — | 5 | ||||||||||||||||
July 2, 2016 | $ | — | $ | 1,625 | $ | — | $ | 177 | $ | 415 | $ | — | $ | — | $ | 2,217 |
Quarter ended | Year-to-date period ended | Program costs to date | |||||||||||||||
(millions) | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | July 2, 2016 | ||||||||||||
Employee related costs | $ | 6 | $ | 16 | $ | 20 | $ | 33 | $ | 279 | |||||||
Asset related costs | 17 | 24 | 27 | 47 | 173 | ||||||||||||
Asset impairment | 16 | 18 | 16 | 18 | 121 | ||||||||||||
Other costs | 33 | 32 | 61 | 60 | 380 | ||||||||||||
Total | $ | 72 | $ | 90 | $ | 124 | $ | 158 | $ | 953 | |||||||
Quarter ended | Year-to-date period ended | Program costs to date | |||||||||||||||
(millions) | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | July 2, 2016 | ||||||||||||
U.S. Morning Foods | $ | 4 | $ | 13 | $ | 9 | $ | 21 | $ | 227 | |||||||
U.S. Snacks | 34 | 10 | 54 | 19 | 180 | ||||||||||||
U.S. Specialty | 1 | 1 | 3 | 2 | 14 | ||||||||||||
North America Other | 4 | 23 | 13 | 29 | 103 | ||||||||||||
Europe | 14 | 25 | 28 | 44 | 201 | ||||||||||||
Latin America | 4 | 1 | 4 | 1 | 20 | ||||||||||||
Asia Pacific | 4 | 3 | 4 | 8 | 78 | ||||||||||||
Corporate | 7 | 14 | 9 | 34 | 130 | ||||||||||||
Total | $ | 72 | $ | 90 | $ | 124 | $ | 158 | $ | 953 |
Employee Related Costs | Asset Impairment | Asset Related Costs | Other Costs | Total | |||||||||||
Liability as of January 2, 2016 | $ | 55 | $ | — | $ | — | $ | 33 | $ | 88 | |||||
2016 restructuring charges | 20 | 16 | 27 | 61 | 124 | ||||||||||
Cash payments | (35 | ) | — | (11 | ) | (64 | ) | (110 | ) | ||||||
Non-cash charges and other | — | (16 | ) | (16 | ) | — | (32 | ) | |||||||
Liability as of July 2, 2016 | $ | 40 | $ | — | $ | — | $ | 30 | $ | 70 |
(millions, except per share data) | Net income attributable to Kellogg Company | Average shares outstanding | Earnings per share | |||||
2016 | ||||||||
Basic | $ | 280 | 350 | $ | 0.80 | |||
Dilutive potential common shares | 4 | (0.01 | ) | |||||
Diluted | $ | 280 | 354 | $ | 0.79 | |||
2015 | ||||||||
Basic | $ | 223 | 353 | $ | 0.63 | |||
Dilutive potential common shares | 2 | — | ||||||
Diluted | $ | 223 | 355 | $ | 0.63 |
(millions, except per share data) | Net income attributable to Kellogg Company | Average shares outstanding | Earnings per share | |||||
2016 | ||||||||
Basic | $ | 455 | 350 | $ | 1.30 | |||
Dilutive potential common shares | 4 | (0.01 | ) | |||||
Diluted | $ | 455 | 354 | $ | 1.29 | |||
2015 | ||||||||
Basic | $ | 450 | 354 | $ | 1.27 | |||
Dilutive potential common shares | 2 | (0.01 | ) | |||||
Diluted | $ | 450 | 356 | $ | 1.26 |
(millions) | |||||||
Details about AOCI components | Amount reclassified from AOCI | Line item impacted within Income Statement | |||||
Quarter ended July 2, 2016 | Year-to-date period ended July 2, 2016 | ||||||
(Gains) losses on cash flow hedges: | |||||||
Foreign currency exchange contracts | $ | — | $ | (7 | ) | COGS | |
Foreign currency exchange contracts | — | — | SGA | ||||
Interest rate contracts | 2 | 8 | Interest expense | ||||
Commodity contracts | 4 | 7 | COGS | ||||
$ | 6 | $ | 8 | Total before tax | |||
(2 | ) | (3 | ) | Tax expense (benefit) | |||
$ | 4 | $ | 5 | Net of tax | |||
Amortization of postretirement and postemployment benefits: | |||||||
Net experience loss | $ | 1 | $ | 2 | See Note 9 for further details | ||
Prior service cost | 2 | 2 | See Note 9 for further details | ||||
$ | 3 | $ | 4 | Total before tax | |||
— | — | Tax expense (benefit) | |||||
$ | 3 | $ | 4 | Net of tax | |||
Total reclassifications | $ | 7 | $ | 9 | Net of tax |
(millions) | |||||||
Details about AOCI components | Amount reclassified from AOCI | Line item impacted within Income Statement | |||||
Quarter ended July 4, 2015 | Year-to-date period ended July 4, 2015 | ||||||
(Gains) losses on cash flow hedges: | |||||||
Foreign currency exchange contracts | $ | (9 | ) | $ | (16 | ) | COGS |
Foreign currency exchange contracts | 2 | 2 | SGA | ||||
Interest rate contracts | 1 | 1 | Interest expense | ||||
Commodity contracts | 3 | 6 | COGS | ||||
$ | (3 | ) | $ | (7 | ) | Total before tax | |
— | — | Tax expense (benefit) | |||||
$ | (3 | ) | $ | (7 | ) | Net of tax | |
Amortization of postretirement and postemployment benefits: | |||||||
Net experience loss | $ | 1 | $ | 2 | See Note 9 for further details | ||
Prior service cost | 2 | 5 | See Note 9 for further details | ||||
$ | 3 | $ | 7 | Total before tax | |||
(1 | ) | (2 | ) | Tax expense (benefit) | |||
$ | 2 | $ | 5 | Net of tax | |||
Total reclassifications | $ | (1 | ) | $ | (2 | ) | Net of tax |
(millions) | July 2, 2016 | January 2, 2016 | ||||
Foreign currency translation adjustments | $ | (1,404 | ) | $ | (1,314 | ) |
Cash flow hedges — unrealized net gain (loss) | (70 | ) | (39 | ) | ||
Postretirement and postemployment benefits: | ||||||
Net experience loss | (14 | ) | (16 | ) | ||
Prior service cost | (6 | ) | (7 | ) | ||
Total accumulated other comprehensive income (loss) | $ | (1,494 | ) | $ | (1,376 | ) |
July 2, 2016 | January 2, 2016 | ||||||||||
(millions) | Principal amount | Effective interest rate (a) | Principal amount | Effective interest rate | |||||||
U.S. commercial paper | $ | 425 | 0.70 | % | $ | 899 | 0.45 | % | |||
Europe commercial paper | 328 | (0.09 | )% | 261 | 0.01 | % | |||||
Bank borrowings | 27 | 44 | |||||||||
Total | $ | 780 | $ | 1,204 |
Quarter ended | Year-to-date period ended | ||||||||||||
(millions) | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | |||||||||
Pre-tax compensation expense | $ | 17 | $ | 13 | $ | 33 | $ | 25 | |||||
Related income tax benefit | $ | 6 | $ | 5 | $ | 12 | $ | 9 |
Employee and director stock options | Shares (millions) | Weighted- average exercise price | Weighted- average remaining contractual term (yrs.) | Aggregate intrinsic value (millions) | ||||||
Outstanding, beginning of period | 19 | $ | 58 | |||||||
Granted | 3 | 76 | ||||||||
Exercised | (4 | ) | 56 | |||||||
Forfeitures and expirations | — | — | ||||||||
Outstanding, end of period | 18 | $ | 61 | 7.2 | $ | 335 | ||||
Exercisable, end of period | 10 | $ | 57 | 6.2 | $ | 247 |
Employee and director stock options | Shares (millions) | Weighted- average exercise price | Weighted- average remaining contractual term (yrs.) | Aggregate intrinsic value (millions) | ||||||
Outstanding, beginning of period | 21 | $ | 56 | |||||||
Granted | 3 | 64 | ||||||||
Exercised | (2 | ) | 53 | |||||||
Forfeitures and expirations | — | — | ||||||||
Outstanding, end of period | 22 | $ | 57 | 7.1 | $ | 131 | ||||
Exercisable, end of period | 13 | $ | 55 | 6.1 | $ | 114 |
Weighted- average expected volatility | Weighted- average expected term (years) | Weighted- average risk-free interest rate | Dividend yield | ||||
Grants within the quarter ended July 2, 2016: | 17 | % | 6.9 | 1.60 | % | 2.60 | % |
Grants within the quarter ended July 4, 2015: | 16 | % | 6.9 | 1.98 | % | 3.00 | % |
(millions) | July 2, 2016 | ||
2014 Award | $ | 32 | |
2015 Award | $ | 27 | |
2016 Award | $ | 31 |
Employee restricted stock and restricted stock units | Shares (thousands) | Weighted-average grant-date fair value | |||
Non-vested, beginning of year | 806 | $ | 58 | ||
Granted | 574 | 70 | |||
Vested | (51 | ) | 55 | ||
Forfeited | (55 | ) | 62 | ||
Non-vested, end of period | 1,274 | $ | 63 |
Employee restricted stock and restricted stock units | Shares (thousands) | Weighted-average grant-date fair value | |||
Non-vested, beginning of year | 346 | $ | 54 | ||
Granted | 563 | 58 | |||
Vested | (79 | ) | 51 | ||
Forfeited | (17 | ) | 56 | ||
Non-vested, end of period | 813 | $ | 57 |
Quarter ended | Year-to-date period ended | ||||||||||||
(millions) | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | |||||||||
Service cost | $ | 25 | $ | 28 | $ | 49 | $ | 56 | |||||
Interest cost | 44 | 53 | 88 | 106 | |||||||||
Expected return on plan assets | (90 | ) | (100 | ) | (179 | ) | (200 | ) | |||||
Amortization of unrecognized prior service cost | 4 | 3 | 7 | 6 | |||||||||
Total pension (income) expense | $ | (17 | ) | $ | (16 | ) | $ | (35 | ) | $ | (32 | ) |
Quarter ended | Year-to-date period ended | ||||||||||||
(millions) | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | |||||||||
Service cost | $ | 5 | $ | 9 | $ | 10 | $ | 17 | |||||
Interest cost | 9 | 13 | 19 | 25 | |||||||||
Expected return on plan assets | (23 | ) | (25 | ) | (45 | ) | (50 | ) | |||||
Amortization of unrecognized prior service cost (credit) | (2 | ) | (1 | ) | (5 | ) | (1 | ) | |||||
Total postretirement benefit (income) expense | $ | (11 | ) | $ | (4 | ) | $ | (21 | ) | $ | (9 | ) |
Quarter ended | Year-to-date period ended | ||||||||||||
(millions) | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | |||||||||
Service cost | $ | 2 | $ | 1 | $ | 4 | $ | 3 | |||||
Interest cost | 1 | 1 | 2 | 2 | |||||||||
Recognized net loss | 1 | 1 | 2 | 2 | |||||||||
Total postemployment benefit expense | $ | 4 | $ | 3 | $ | 8 | $ | 7 |
(millions) | Pension | Nonpension postretirement | Total | ||||||
Quarter ended: | |||||||||
July 2, 2016 | $ | 2 | $ | 4 | $ | 6 | |||
July 4, 2015 | $ | 1 | $ | 4 | $ | 5 | |||
Year-to-date period ended: | |||||||||
July 2, 2016 | $ | 15 | $ | 8 | $ | 23 | |||
July 4, 2015 | $ | 10 | $ | 7 | $ | 17 | |||
Full year: | |||||||||
Fiscal year 2016 (projected) | $ | 28 | $ | 15 | $ | 43 | |||
Fiscal year 2015 (actual) | $ | 19 | $ | 14 | $ | 33 |
(millions) | |||
January 2, 2016 | $ | 73 | |
Tax positions related to current year: | |||
Additions | 3 | ||
Reductions | — | ||
Tax positions related to prior years: | |||
Additions | 1 | ||
Reductions | — | ||
Settlements | — | ||
July 2, 2016 | $ | 77 |
(millions) | July 2, 2016 | January 2, 2016 | ||||
Foreign currency exchange contracts | $ | 1,288 | $ | 1,210 | ||
Interest rate contracts | 668 | — | ||||
Commodity contracts | 470 | 470 | ||||
Total | $ | 2,426 | $ | 1,680 |
July 2, 2016 | January 2, 2016 | ||||||||||||||||||
(millions) | Level 1 | Level 2 | Total | Level 1 | Level 2 | Total | |||||||||||||
Assets: | |||||||||||||||||||
Foreign currency exchange contracts: | |||||||||||||||||||
Other prepaid assets | $ | — | $ | 20 | $ | 20 | $ | — | $ | 11 | $ | 11 | |||||||
Interest rate contracts: | |||||||||||||||||||
Other assets (a) | — | 10 | 10 | — | — | — | |||||||||||||
Total assets | $ | — | $ | 30 | $ | 30 | $ | — | $ | 11 | $ | 11 | |||||||
Liabilities: | |||||||||||||||||||
Foreign currency exchange contracts: | |||||||||||||||||||
Other current liabilities | $ | — | $ | (12 | ) | $ | (12 | ) | $ | — | $ | (10 | ) | $ | (10 | ) | |||
Commodity contracts: | |||||||||||||||||||
Other current liabilities | — | (6 | ) | (6 | ) | — | (14 | ) | (14 | ) | |||||||||
Total liabilities | $ | — | $ | (18 | ) | $ | (18 | ) | $ | — | $ | (24 | ) | $ | (24 | ) |
July 2, 2016 | January 2, 2016 | ||||||||||||||||||
(millions) | Level 1 | Level 2 | Total | Level 1 | Level 2 | Total | |||||||||||||
Assets: | |||||||||||||||||||
Foreign currency exchange contracts: | |||||||||||||||||||
Other prepaid assets | $ | — | $ | 9 | $ | 9 | $ | — | $ | 18 | $ | 18 | |||||||
Commodity contracts: | |||||||||||||||||||
Other prepaid assets | 7 | — | 7 | 4 | — | 4 | |||||||||||||
Total assets | $ | 7 | $ | 9 | $ | 16 | $ | 4 | $ | 18 | $ | 22 | |||||||
Liabilities: | |||||||||||||||||||
Foreign currency exchange contracts: | |||||||||||||||||||
Other current liabilities | $ | — | $ | (5 | ) | $ | (5 | ) | $ | — | $ | (6 | ) | $ | (6 | ) | |||
Commodity contracts: | |||||||||||||||||||
Other current liabilities | (16 | ) | — | (16 | ) | $ | (33 | ) | $ | — | $ | (33 | ) | ||||||
Total liabilities | $ | (16 | ) | $ | (5 | ) | $ | (21 | ) | $ | (33 | ) | $ | (6 | ) | $ | (39 | ) |
As of July 2, 2016: | ||||||||||||
Gross Amounts Not Offset in the Consolidated Balance Sheet | ||||||||||||
Amounts Presented in the Consolidated Balance Sheet | Financial Instruments | Cash Collateral Received/ Posted | Net Amount | |||||||||
Total asset derivatives | $ | 46 | $ | (12 | ) | $ | — | $ | 34 | |||
Total liability derivatives | $ | (39 | ) | $ | 12 | $ | 27 | $ | — |
As of January 2, 2016: | ||||||||||||
Gross Amounts Not Offset in the Consolidated Balance Sheet | ||||||||||||
Amounts Presented in the Consolidated Balance Sheet | Financial Instruments | Cash Collateral Received/ Posted | Net Amount | |||||||||
Total asset derivatives | $ | 33 | $ | (12 | ) | $ | — | $ | 21 | |||
Total liability derivatives | $ | (63 | ) | $ | 12 | $ | 51 | $ | — |
(millions) | Location of gain (loss) recognized in income | Gain (loss) recognized in income (a) | ||||||
July 2, 2016 | July 4, 2015 | |||||||
Foreign currency exchange contracts | Other income (expense), net | $ | — | $ | — | |||
Interest rate contracts | Interest expense | 3 | (2 | ) | ||||
Total | $ | 3 | $ | (2 | ) |
(a) | Includes the ineffective portion and amount excluded from effectiveness testing. |
(millions) | Gain (loss) recognized in AOCI | Location of gain (loss) reclassified from AOCI | Gain (loss) reclassified from AOCI into income | Location of gain (loss) recognized in income (a) | Gain (loss) recognized in income (a) | ||||||||||||||||||
July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | ||||||||||||||||||
Foreign currency exchange contracts | $ | (1 | ) | $ | 2 | COGS | $ | — | $ | 9 | Other income (expense), net | $ | (1 | ) | $ | (2 | ) | ||||||
Foreign currency exchange contracts | — | (6 | ) | SGA expense | — | (2 | ) | Other income (expense), net | — | — | |||||||||||||
Interest rate contracts | (3 | ) | — | Interest expense | (2 | ) | (1 | ) | N/A | — | — | ||||||||||||
Commodity contracts | 1 | — | COGS | (4 | ) | (3 | ) | Other income (expense), net | — | — | |||||||||||||
Total | $ | (3 | ) | $ | (4 | ) | $ | (6 | ) | $ | 3 | $ | (1 | ) | $ | (2 | ) |
(a) | Includes the ineffective portion and amount excluded from effectiveness testing. |
(millions) | Gain (loss) recognized in AOCI | ||||||
July 2, 2016 | July 4, 2015 | ||||||
Foreign currency denominated long-term debt | $ | 46 | $ | (14 | ) | ||
Foreign currency exchange contracts | (1 | ) | — | ||||
Total | $ | 45 | $ | (14 | ) |
(millions) | Location of gain (loss) recognized in income | Gain (loss) recognized in income | ||||||
July 2, 2016 | July 4, 2015 | |||||||
Foreign currency exchange contracts | COGS | $ | (1 | ) | $ | 1 | ||
Foreign currency exchange contracts | Other income (expense), net | (1 | ) | 5 | ||||
Commodity contracts | COGS | 6 | 13 | |||||
Commodity contracts | SGA | 2 | 1 | |||||
Total | $ | 6 | $ | 20 |
(millions) | Location of gain (loss) recognized in income | Gain (loss) recognized in income (a) | ||||||
July 2, 2016 | July 4, 2015 | |||||||
Foreign currency exchange contracts | Other income (expense), net | $ | — | $ | (4 | ) | ||
Interest rate contracts | Interest expense | 9 | 7 | |||||
Total | $ | 9 | $ | 3 |
(millions) | Gain (loss) recognized in AOCI | Location of gain (loss) reclassified from AOCI | Gain (loss) reclassified from AOCI into income | Location of gain (loss) recognized in income (a) | Gain (loss) recognized in income (a) | ||||||||||||||||||
July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | ||||||||||||||||||
Foreign currency exchange contracts | $ | 9 | $ | 19 | COGS | $ | 7 | $ | 16 | Other income (expense), net | $ | (1 | ) | $ | (2 | ) | |||||||
Foreign currency exchange contracts | — | (6 | ) | SGA expense | — | (2 | ) | Other income (expense), net | — | — | |||||||||||||
Interest rate contracts | (69 | ) | (9 | ) | Interest expense | (8 | ) | (1 | ) | N/A | — | — | |||||||||||
Commodity contracts | — | — | COGS | (7 | ) | (6 | ) | Other income (expense), net | — | — | |||||||||||||
Total | $ | (60 | ) | $ | 4 | $ | (8 | ) | $ | 7 | $ | (1 | ) | $ | (2 | ) |
(millions) | Gain (loss) recognized in AOCI | ||||||
July 2, 2016 | July 4, 2015 | ||||||
Foreign currency denominated long-term debt | $ | (12 | ) | $ | 43 | ||
Foreign currency exchange contracts | (23 | ) | — | ||||
Total | $ | (35 | ) | $ | 43 |
(millions) | Location of gain (loss) recognized in income | Gain (loss) recognized in income | ||||||
July 2, 2016 | July 4, 2015 | |||||||
Foreign currency exchange contracts | COGS | $ | (10 | ) | $ | 1 | ||
Foreign currency exchange contracts | Other income (expense), net | 10 | 7 | |||||
Interest rate contracts | Interest expense | — | — | |||||
Commodity contracts | COGS | 10 | 2 | |||||
Commodity contracts | SGA | 2 | 1 | |||||
Total | $ | 12 | $ | 11 |
(millions) | Fair Value | Total Loss | |||||
Description: | |||||||
Long-lived assets | $ | 10 | $ | (16 | ) | ||
Total | $ | 10 | $ | (16 | ) |
(millions) | Fair Value | Total Loss | |||||
Description: | |||||||
Long-lived assets | $ | 15 | $ | (67 | ) | ||
Total | $ | 15 | $ | (67 | ) |
(millions) | Fair Value | Carrying Value | ||||
Current maturities of long-term debt | $ | 1,144 | $ | 1,144 | ||
Long-term debt | 6,815 | 6,277 | ||||
Total | $ | 7,959 | $ | 7,421 |
Quarter ended | Year-to-date period ended | ||||||||||||
(millions) | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | |||||||||
Net sales | |||||||||||||
U.S. Morning Foods | $ | 727 | $ | 742 | $ | 1,494 | $ | 1,518 | |||||
U.S. Snacks | 803 | 835 | 1,635 | 1,689 | |||||||||
U.S. Specialty | 271 | 270 | 647 | 631 | |||||||||
North America Other | 406 | 439 | 820 | 872 | |||||||||
Europe | 629 | 650 | 1,227 | 1,257 | |||||||||
Latin America | 204 | 328 | 396 | 623 | |||||||||
Asia Pacific | 228 | 234 | 444 | 464 | |||||||||
Consolidated | $ | 3,268 | $ | 3,498 | $ | 6,663 | $ | 7,054 | |||||
Operating profit | |||||||||||||
U.S. Morning Foods | $ | 165 | $ | 131 | $ | 313 | $ | 258 | |||||
U.S. Snacks (a) | 69 | 160 | 152 | 240 | |||||||||
U.S. Specialty | 60 | 59 | 146 | 137 | |||||||||
North America Other | 47 | 37 | 92 | 96 | |||||||||
Europe | 68 | 57 | 138 | 118 | |||||||||
Latin America (b) | 20 | (56 | ) | 43 | (5 | ) | |||||||
Asia Pacific | 12 | 10 | 29 | 22 | |||||||||
Total Reportable Segments | 441 | 398 | 913 | 866 | |||||||||
Corporate (c) | 8 | 14 | (26 | ) | (70 | ) | |||||||
Consolidated | $ | 449 | $ | 412 | $ | 887 | $ | 796 |
(a) | Includes a non-cash gain of $67 million associated with the deconsolidation of a VIE during the quarter and year-to-date period ended July 4, 2015. |
(b) | Includes non-cash losses totaling $7 million and $103 million associated with the remeasurement of the financial statements of the Company's Venezuela subsidiary during the quarters ended July 2, 2016 and July 4, 2015, respectively. Includes a non-cash loss of $13 million and $103 million associated with the remeasurement of the financial statements of the Company's Venezuela subsidiary during the year-to-date periods ended July 2, 2016 and July 4, 2015, respectively. |
(c) | Includes mark-to-market adjustments for pension plans, commodity and foreign currency contracts totaling $20 million and $35 million for the quarters ended July 2, 2016 and July 4, 2015, respectively. Includes mark-to-market adjustments for pension plans, commodity and foreign currency contracts totaling ($4) million and ($32) million for the year-to-date periods ended July 2, 2016 and July 4, 2015, respectively. |
• | Productivity and savings - In addition to annual productivity savings to offset inflation, we will expand our zero-based budgeting initiative in the U.S., and launch it in our international regions. We also are working on additional Project K initiatives. The result of these initiatives should be higher annual savings. |
• | Price Realization - We will establish a more formal Revenue Growth Management discipline around the world, to help us realize price in a more effective way. |
• | Investing for Impact - We are updating our investment model to align with today's consumer and technology in order to optimize the return on investment in our brands. |
• | On-Trend Foods - We are adopting a more impactful approach to renovation and innovation of our foods. |
• | Comparable net sales: We adjust the GAAP financial measures to exclude the pre-tax effect of acquisitions, divestitures, and shipping day differences. We excluded the items which we believe may obscure trends in our underlying net sales performance. By providing this non-GAAP net sales measure, management intends to provide investors with a meaningful, consistent comparison of net sales performance for the Company and each of our reportable segments for the periods presented. Management uses this non-GAAP measure to evaluate the effectiveness of initiatives behind net sales growth, pricing realization, and the impact of mix on our business results. This non-GAAP measure is also used to make decisions regarding the future direction of our business, and for resource allocation decisions. Currency-neutral comparable net sales represents comparable net sales excluding the impact of foreign currency. |
• | Comparable gross profit, comparable gross margin, comparable SGA, comparable SGA%, comparable operating profit, comparable operating profit margin, comparable net income attributable to Kellogg Company, and comparable diluted EPS: We adjust the GAAP financial measures to exclude the effect of Project K and cost reduction activities, acquisitions, divestitures, integration costs, mark-to-market adjustments for pension plans, commodities and certain foreign currency contracts, costs associated with the VIE deconsolidation and costs associated with the Venezuela remeasurement. We excluded the items which we believe may obscure trends in our underlying profitability. By providing these non-GAAP profitability measures, management intends to provide investors with a meaningful, consistent comparison of the Company's profitability measures for the periods presented. Management uses these non-GAAP financial measures to evaluate the effectiveness of initiatives intended to improve profitability, such as Project K, ZBB and Revenue Growth Management, as well as to evaluate the impacts of inflationary pressures and decisions to invest in new initiatives within each of our segments. Currency-neutral comparable represents comparable excluding foreign currency impact. |
• | Cash flow: Defined as net cash provided by operating activities reduced by expenditures for property additions. Cash flow does not represent the residual cash flow available for discretionary expenditures. We use this non-GAAP financial measure of cash flow to focus management and investors on the amount of cash available for debt repayment, dividend distributions, acquisition opportunities, and share repurchases once all of the Company’s business needs and obligations are met. Additionally, certain performance-based compensation includes a component of this non-GAAP measure. |
Quarter ended | Year-to-date period ended | |||||||||||
Consolidated results (dollars in millions, except per share data) | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | ||||||||
Reported net income attributable to Kellogg Company | $ | 280 | $ | 223 | $ | 455 | $ | 450 | ||||
Mark-to-market (pre-tax) | 20 | 35 | (4 | ) | (32 | ) | ||||||
Project K and cost reduction activities (pre-tax) | (72 | ) | (90 | ) | (124 | ) | (158 | ) | ||||
Other costs impacting comparability (pre-tax) | — | 73 | (153 | ) | 48 | |||||||
Acquisitions/divestitures and integration costs (pre-tax) | — | (6 | ) | — | (14 | ) | ||||||
Venezuela remeasurement (pre-tax) | (5 | ) | (152 | ) | (11 | ) | (152 | ) | ||||
Income tax benefit applicable to adjustments, net* | 16 | 36 | 85 | 80 | ||||||||
Comparable net income attributable to Kellogg Company | $ | 321 | $ | 327 | $ | 662 | $ | 678 | ||||
Foreign currency impact | (31 | ) | (163 | ) | ||||||||
Currency-neutral comparable net income attributable to Kellogg Company | $ | 352 | $ | 825 | ||||||||
Reported diluted EPS | $ | 0.79 | $ | 0.63 | $ | 1.29 | $ | 1.26 | ||||
Mark-to-market (pre-tax) | 0.05 | 0.10 | (0.01 | ) | (0.09 | ) | ||||||
Project K and cost reduction activities (pre-tax) | (0.20 | ) | (0.25 | ) | (0.35 | ) | (0.44 | ) | ||||
Other costs impacting comparability (pre-tax) | — | 0.21 | (0.43 | ) | 0.13 | |||||||
Acquisitions/divestitures and integration costs (pre-tax) | — | (0.02 | ) | — | (0.04 | ) | ||||||
Venezuela remeasurement (pre-tax) | (0.01 | ) | (0.43 | ) | (0.03 | ) | (0.43 | ) | ||||
Income tax benefit applicable to adjustments, net* | 0.04 | 0.10 | 0.24 | 0.23 | ||||||||
Comparable diluted EPS | $ | 0.91 | $ | 0.92 | $ | 1.87 | $ | 1.90 | ||||
Foreign currency impact | (0.09 | ) | (0.46 | ) | ||||||||
Currency-neutral comparable diluted EPS | $ | 1.00 | $ | 2.33 | ||||||||
Currency-neutral comparable diluted EPS growth | 8.7 | % | (4.9 | )% | 22.6 | % | (1.0 | )% |
Quarter ended July 2, 2016 | ||||||||||||||||||||||||||||||||||||
(millions) | U.S. Morning Foods | U.S. Snacks | U.S. Specialty | North America Other | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | |||||||||||||||||||||||||||
Reported net sales | $ | 727 | $ | 803 | $ | 271 | $ | 406 | $ | 629 | $ | 204 | $ | 228 | $ | — | $ | 3,268 | ||||||||||||||||||
Project K and cost reduction activities | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Acquisitions/divestitures and integration costs | — | — | — | — | 5 | — | — | — | 5 | |||||||||||||||||||||||||||
Differences in shipping days | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Comparable net sales | $ | 727 | $ | 803 | $ | 271 | $ | 406 | $ | 624 | $ | 204 | $ | 228 | $ | — | $ | 3,263 | ||||||||||||||||||
Foreign currency impact | — | — | — | (4 | ) | (26 | ) | (491 | ) | (7 | ) | — | (528 | ) | ||||||||||||||||||||||
Currency-neutral comparable net sales | $ | 727 | $ | 803 | $ | 271 | $ | 410 | $ | 650 | $ | 695 | $ | 235 | $ | — | $ | 3,791 | ||||||||||||||||||
Quarter ended July 4, 2015 | ||||||||||||||||||||||||||||||||||||
(millions) | U.S. Morning Foods | U.S. Snacks | U.S. Specialty | North America Other | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | |||||||||||||||||||||||||||
Reported net sales | $ | 742 | $ | 835 | $ | 270 | $ | 439 | $ | 650 | $ | 328 | $ | 234 | $ | — | $ | 3,498 | ||||||||||||||||||
Project K and cost reduction activities | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Acquisitions/divestitures and integration costs | — | — | — | — | — | — | 8 | — | 8 | |||||||||||||||||||||||||||
Differences in shipping days | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Comparable net sales | $ | 742 | $ | 835 | $ | 270 | $ | 439 | $ | 650 | $ | 328 | $ | 226 | $ | — | $ | 3,490 | ||||||||||||||||||
% change - 2016 vs. 2015: | ||||||||||||||||||||||||||||||||||||
Reported growth | (2.0 | )% | (3.9 | )% | 0.5 | % | (7.4 | )% | (3.2 | )% | (37.9 | )% | (2.9 | )% | — | % | (6.6 | )% | ||||||||||||||||||
Project K and cost reduction activities | — | % | — | % | — | % | — | % | — | % | — | % | — | % | — | % | — | % | ||||||||||||||||||
Acquisitions/divestitures and integration costs | — | % | — | % | — | % | 0.1 | % | 0.7 | % | — | % | (3.1 | )% | — | % | (0.1 | )% | ||||||||||||||||||
Differences in shipping days | — | % | — | % | — | % | — | % | — | % | — | % | — | % | — | % | — | % | ||||||||||||||||||
Comparable growth | (2.0 | )% | (3.9 | )% | 0.5 | % | (7.5 | )% | (3.9 | )% | (37.9 | )% | 0.2 | % | — | % | (6.5 | )% | ||||||||||||||||||
Foreign currency impact | — | % | — | % | — | % | (1.1 | )% | (3.9 | )% | (149.8 | )% | (3.2 | )% | — | % | (15.1 | )% | ||||||||||||||||||
Currency-neutral comparable growth | (2.0 | )% | (3.9 | )% | 0.5 | % | (6.4 | )% | — | % | 111.9 | % | 3.4 | % | — | % | 8.6 | % |
Quarter ended July 2, 2016 | ||||||||||||||||||||||||||||||||||||
(millions) | U.S. Morning Foods | U.S. Snacks | U.S. Specialty | North America Other | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | |||||||||||||||||||||||||||
Reported operating profit | $ | 165 | $ | 69 | $ | 60 | $ | 47 | $ | 68 | $ | 20 | $ | 12 | $ | 8 | $ | 449 | ||||||||||||||||||
Mark-to-market | — | — | — | — | — | — | — | 20 | 20 | |||||||||||||||||||||||||||
Project K and cost reduction activities | (4 | ) | (34 | ) | (1 | ) | (4 | ) | (14 | ) | (4 | ) | (4 | ) | (7 | ) | (72 | ) | ||||||||||||||||||
Other costs impacting comparability | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Acquisitions/divestitures and integration costs | — | — | — | — | 1 | — | — | — | 1 | |||||||||||||||||||||||||||
Differences in shipping days | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Venezuela remeasurement | — | — | — | — | — | (7 | ) | — | — | (7 | ) | |||||||||||||||||||||||||
Comparable operating profit | $ | 169 | $ | 103 | $ | 61 | $ | 51 | $ | 81 | $ | 31 | $ | 16 | $ | (5 | ) | $ | 507 | |||||||||||||||||
Foreign currency impact | — | — | — | (2 | ) | (7 | ) | (47 | ) | 1 | 3 | (52 | ) | |||||||||||||||||||||||
Currency-neutral comparable operating profit | $ | 169 | $ | 103 | $ | 61 | $ | 53 | $ | 88 | $ | 78 | $ | 15 | $ | (8 | ) | $ | 559 | |||||||||||||||||
Quarter ended July 4, 2015 | ||||||||||||||||||||||||||||||||||||
(millions) | U.S. Morning Foods | U.S. Snacks | U.S. Specialty | North America Other | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | |||||||||||||||||||||||||||
Reported operating profit | $ | 131 | $ | 160 | $ | 59 | $ | 37 | $ | 57 | $ | (56 | ) | $ | 10 | $ | 14 | $ | 412 | |||||||||||||||||
Mark-to-market | — | — | — | — | — | — | — | 35 | 35 | |||||||||||||||||||||||||||
Project K and cost reduction activities | (13 | ) | (10 | ) | (1 | ) | (23 | ) | (25 | ) | (1 | ) | (3 | ) | (14 | ) | (90 | ) | ||||||||||||||||||
Other costs impacting comparability | — | 67 | — | — | — | — | — | — | 67 | |||||||||||||||||||||||||||
Acquisitions/divestitures and integration costs | — | — | — | — | (3 | ) | — | 1 | (1 | ) | (3 | ) | ||||||||||||||||||||||||
Differences in shipping days | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Venezuela remeasurement | — | — | — | — | — | (102 | ) | — | (1 | ) | (103 | ) | ||||||||||||||||||||||||
Comparable operating profit | $ | 144 | $ | 103 | $ | 60 | $ | 60 | $ | 85 | $ | 47 | $ | 12 | $ | (5 | ) | $ | 506 | |||||||||||||||||
% change - 2016 vs. 2015: | ||||||||||||||||||||||||||||||||||||
Reported growth | 25.1 | % | (57.2 | )% | 2.5 | % | 31.8 | % | 19.5 | % | 135.2 | % | 18.1 | % | (35.3 | )% | 9.1 | % | ||||||||||||||||||
Mark-to-market | — | % | — | % | — | % | — | % | — | % | — | % | — | % | (83.7 | )% | (5.0 | )% | ||||||||||||||||||
Project K and cost reduction activities | 8.0 | % | (17.3 | )% | (1.5 | )% | 43.5 | % | 19.5 | % | (7.5 | )% | 5.5 | % | 1.6 | % | 6.5 | % | ||||||||||||||||||
Other costs impacting comparability | — | % | (38.4 | )% | — | % | — | % | — | % | — | % | — | % | — | % | (17.9 | )% | ||||||||||||||||||
Acquisitions/divestitures and integration costs | — | % | — | % | — | % | (0.1 | )% | 3.5 | % | (0.3 | )% | (5.8 | )% | 14.6 | % | 1.3 | % | ||||||||||||||||||
Differences in shipping days | — | % | — | % | — | % | — | % | — | % | — | % | — | % | — | % | — | % | ||||||||||||||||||
Venezuela remeasurement | — | % | — | % | — | % | — | % | — | % | 179.9 | % | — | % | 13.2 | % | 23.9 | % | ||||||||||||||||||
Comparable growth | 17.1 | % | (1.5 | )% | 4.0 | % | (11.6 | )% | (3.5 | )% | (36.9 | )% | 18.4 | % | 19.0 | % | 0.3 | % | ||||||||||||||||||
Foreign currency impact | — | % | — | % | — | % | (1.1 | )% | (7.2 | )% | (103.5 | )% | 0.9 | % | 68.5 | % | (10.3 | )% | ||||||||||||||||||
Currency-neutral comparable growth | 17.1 | % | (1.5 | )% | 4.0 | % | (10.5 | )% | 3.7 | % | 66.6 | % | 17.5 | % | (49.5 | )% | 10.6 | % |
Year-to-date period ended July 2, 2016 | ||||||||||||||||||||||||||||||||||||
(millions) | U.S. Morning Foods | U.S. Snacks | U.S. Specialty | North America Other | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | |||||||||||||||||||||||||||
Reported net sales | $ | 1,494 | $ | 1,635 | $ | 647 | $ | 820 | $ | 1,227 | $ | 396 | $ | 444 | $ | — | $ | 6,663 | ||||||||||||||||||
Project K and cost reduction activities | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Acquisitions/divestitures and integration costs | — | — | — | 1 | 19 | — | — | — | 20 | |||||||||||||||||||||||||||
Differences in shipping days | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Comparable net sales | $ | 1,494 | $ | 1,635 | $ | 647 | $ | 819 | $ | 1,208 | $ | 396 | $ | 444 | $ | — | $ | 6,643 | ||||||||||||||||||
Foreign currency impact | — | — | — | (15 | ) | (47 | ) | (860 | ) | (22 | ) | — | (944 | ) | ||||||||||||||||||||||
Currency-neutral comparable net sales | $ | 1,494 | $ | 1,635 | $ | 647 | $ | 834 | $ | 1,255 | $ | 1,256 | $ | 466 | $ | — | $ | 7,587 | ||||||||||||||||||
Year-to-date period ended July 4, 2015 | ||||||||||||||||||||||||||||||||||||
(millions) | U.S. Morning Foods | U.S. Snacks | U.S. Specialty | North America Other | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | |||||||||||||||||||||||||||
Reported net sales | $ | 1,518 | $ | 1,689 | $ | 631 | $ | 872 | $ | 1,257 | $ | 623 | $ | 464 | $ | — | $ | 7,054 | ||||||||||||||||||
Project K and cost reduction activities | — | — | — | (2 | ) | — | — | — | — | (2 | ) | |||||||||||||||||||||||||
Acquisitions/divestitures and integration costs | — | — | — | — | — | — | 8 | — | 8 | |||||||||||||||||||||||||||
Differences in shipping days | — | — | — | — | (3 | ) | — | — | — | (3 | ) | |||||||||||||||||||||||||
Comparable net sales | $ | 1,518 | $ | 1,689 | $ | 631 | $ | 874 | $ | 1,260 | $ | 623 | $ | 456 | $ | — | $ | 7,051 | ||||||||||||||||||
% change - 2016 vs. 2015: | ||||||||||||||||||||||||||||||||||||
Reported growth | (1.6 | )% | (3.2 | )% | 2.6 | % | (5.9 | )% | (2.4 | )% | (36.5 | )% | (4.3 | )% | — | % | (5.5 | )% | ||||||||||||||||||
Project K and cost reduction activities | — | % | — | % | — | % | 0.2 | % | — | % | — | % | — | % | — | % | — | % | ||||||||||||||||||
Acquisitions/divestitures and integration costs | — | % | — | % | — | % | 0.2 | % | 1.5 | % | — | % | (1.6 | )% | — | % | 0.2 | % | ||||||||||||||||||
Differences in shipping days | — | % | — | % | — | % | — | % | 0.2 | % | — | % | — | % | — | % | 0.1 | % | ||||||||||||||||||
Comparable growth | (1.6 | )% | (3.2 | )% | 2.6 | % | (6.3 | )% | (4.1 | )% | (36.5 | )% | (2.7 | )% | — | % | (5.8 | )% | ||||||||||||||||||
Foreign currency impact | — | % | — | % | — | % | (1.8 | )% | (3.7 | )% | (138.2 | )% | (4.9 | )% | — | % | (13.4 | )% | ||||||||||||||||||
Currency-neutral comparable growth | (1.6 | )% | (3.2 | )% | 2.6 | % | (4.5 | )% | (0.4 | )% | 101.7 | % | 2.2 | % | — | % | 7.6 | % |
Year-to-date period ended July 2, 2016 | ||||||||||||||||||||||||||||||||||||
(millions) | U.S. Morning Foods | U.S. Snacks | U.S. Specialty | North America Other | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | |||||||||||||||||||||||||||
Reported operating profit | $ | 313 | $ | 152 | $ | 146 | $ | 92 | $ | 138 | $ | 43 | $ | 29 | $ | (26 | ) | $ | 887 | |||||||||||||||||
Mark-to-market | — | — | — | — | — | — | — | (4 | ) | (4 | ) | |||||||||||||||||||||||||
Project K and cost reduction activities | (9 | ) | (54 | ) | (3 | ) | (13 | ) | (28 | ) | (4 | ) | (4 | ) | (9 | ) | (124 | ) | ||||||||||||||||||
Other costs impacting comparability | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Acquisitions/divestitures and integration costs | — | — | — | — | 1 | — | — | — | 1 | |||||||||||||||||||||||||||
Differences in shipping days | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Venezuela remeasurement | — | — | — | — | — | (13 | ) | — | — | (13 | ) | |||||||||||||||||||||||||
Comparable operating profit | $ | 322 | $ | 206 | $ | 149 | $ | 105 | $ | 165 | $ | 60 | $ | 33 | $ | (13 | ) | $ | 1,027 | |||||||||||||||||
Foreign currency impact | — | — | — | (3 | ) | (9 | ) | (237 | ) | — | 6 | (243 | ) | |||||||||||||||||||||||
Currency-neutral comparable operating profit | $ | 322 | $ | 206 | $ | 149 | $ | 108 | $ | 174 | $ | 297 | $ | 33 | $ | (19 | ) | $ | 1,270 | |||||||||||||||||
Year-to-date period ended July 4, 2015 | ||||||||||||||||||||||||||||||||||||
(millions) | U.S. Morning Foods | U.S. Snacks | U.S. Specialty | North America Other | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | |||||||||||||||||||||||||||
Reported operating profit | $ | 258 | $ | 240 | $ | 137 | $ | 96 | $ | 118 | $ | (5 | ) | $ | 22 | $ | (70 | ) | $ | 796 | ||||||||||||||||
Mark-to-market | — | — | — | — | — | — | — | (32 | ) | (32 | ) | |||||||||||||||||||||||||
Project K and cost reduction activities | (21 | ) | (19 | ) | (2 | ) | (29 | ) | (44 | ) | (1 | ) | (8 | ) | (34 | ) | (158 | ) | ||||||||||||||||||
Other costs impacting comparability | — | 67 | — | — | — | — | — | — | 67 | |||||||||||||||||||||||||||
Acquisitions/divestitures and integration costs | — | — | — | — | (8 | ) | — | (2 | ) | (1 | ) | (11 | ) | |||||||||||||||||||||||
Differences in shipping days | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Venezuela remeasurement | — | — | — | — | — | (102 | ) | — | (1 | ) | (103 | ) | ||||||||||||||||||||||||
Comparable operating profit | $ | 279 | $ | 192 | $ | 139 | $ | 125 | $ | 170 | $ | 98 | $ | 32 | $ | (2 | ) | $ | 1,033 | |||||||||||||||||
% change - 2016 vs. 2015: | ||||||||||||||||||||||||||||||||||||
Reported growth | 21.1 | % | (36.7 | )% | 6.5 | % | (3.5 | )% | 16.5 | % | 929.1 | % | 28.5 | % | 64.3 | % | 11.5 | % | ||||||||||||||||||
Mark-to-market | — | % | — | % | — | % | — | % | — | % | — | % | — | % | 18.3 | % | 3.8 | % | ||||||||||||||||||
Project K and cost reduction activities | 5.7 | % | (16.1 | )% | (1.1 | )% | 11.8 | % | 14.2 | % | (372.8 | )% | 21.1 | % | 234.9 | % | 4.6 | % | ||||||||||||||||||
Other costs impacting comparability | — | % | (27.4 | )% | — | % | — | % | — | % | — | % | — | % | — | % | (7.4 | )% | ||||||||||||||||||
Acquisitions/divestitures and integration costs | — | % | — | % | — | % | (0.2 | )% | 5.5 | % | (138.3 | )% | 5.0 | % | 172.7 | % | 1.4 | % | ||||||||||||||||||
Differences in shipping days | — | % | — | % | — | % | — | % | 0.3 | % | — | % | — | % | — | % | 0.1 | % | ||||||||||||||||||
Venezuela remeasurement | — | % | — | % | — | % | — | % | — | % | 1,479.1 | % | — | % | 276.1 | % | 9.5 | % | ||||||||||||||||||
Comparable growth | 15.4 | % | 6.8 | % | 7.6 | % | (15.1 | )% | (3.5 | )% | (38.9 | )% | 2.4 | % | (637.7 | )% | (0.5 | )% | ||||||||||||||||||
Foreign currency impact | 0.1 | % | — | % | — | % | (2.0 | )% | (5.6 | )% | (242.2 | )% | (0.9 | )% | 435.0 | % | (23.5 | )% | ||||||||||||||||||
Currency-neutral comparable growth | 15.3 | % | 6.8 | % | 7.6 | % | (13.1 | )% | 2.1 | % | 203.3 | % | 3.3 | % | (1,072.7 | )% | 23.0 | % |
Quarter | 2016 | 2015 | Change vs. prior year (pts.) | |||
Reported gross margin (a) | 38.9 | % | 35.5 | % | 3.4 | |
Mark-to-market (COGS) | 0.5 | 1.0 | (0.5 | ) | ||
Project K and cost reduction activities (COGS) | (1.0 | ) | (1.9 | ) | 0.9 | |
Other costs impacting comparability (COGS) | — | — | — | |||
Acquisitions/divestitures and integration costs (COGS) | — | — | — | |||
Venezuela remeasurement (COGS) | (0.2 | ) | (2.9 | ) | 2.7 | |
Comparable gross margin | 39.6 | % | 39.3 | % | 0.3 | |
Foreign currency impact | 3.0 | 3.0 | ||||
Currency-neutral comparable gross margin | 36.6 | % | (2.7 | ) | ||
Reported SGA% | (25.1 | )% | (23.7 | )% | (1.4 | ) |
Mark-to-market (SGA) | 0.1 | — | 0.1 | |||
Project K and cost reduction activities (SGA) | (1.2 | ) | (0.7 | ) | (0.5 | ) |
Other costs impacting comparability (SGA) | — | 1.9 | (1.9 | ) | ||
Acquisitions/divestitures and integration costs (SGA) | — | (0.1 | ) | 0.1 | ||
Venezuela remeasurement (SGA) | — | — | — | |||
Comparable SGA% | (24.0 | )% | (24.8 | )% | 0.8 | |
Foreign currency impact | (2.2 | ) | (2.2 | ) | ||
Currency-neutral comparable SGA% | (21.8 | )% | 3.0 | |||
Reported operating margin | 13.8 | % | 11.8 | % | 2.0 | |
Mark-to-market | 0.6 | 1.0 | (0.4 | ) | ||
Project K and cost reduction activities | (2.2 | ) | (2.6 | ) | 0.4 | |
Other costs impacting comparability | — | 1.9 | (1.9 | ) | ||
Acquisitions/divestitures and integration costs | — | (0.1 | ) | 0.1 | ||
Venezuela remeasurement | (0.2 | ) | (2.9 | ) | 2.7 | |
Comparable operating margin | 15.6 | % | 14.5 | % | 1.1 | |
Foreign currency impact | 0.8 | 0.8 | ||||
Currency-neutral comparable operating margin | 14.8 | % | 0.3 |
Year-to-date | 2016 | 2015 | Change vs. prior year (pts.) | |||
Reported gross margin (a) | 37.7 | % | 35.3 | % | 2.4 | |
Mark-to-market (COGS) | (0.2 | ) | (0.4 | ) | 0.2 | |
Project K and cost reduction activities (COGS) | (0.8 | ) | (1.4 | ) | 0.6 | |
Other costs impacting comparability (COGS) | — | — | — | |||
Acquisitions/divestitures and integration costs (COGS) | — | (0.2 | ) | 0.2 | ||
Differences in shipping days (COGS) | — | — | — | |||
Venezuela remeasurement (COGS) | (0.2 | ) | (1.4 | ) | 1.2 | |
Comparable gross margin | 38.9 | % | 38.7 | % | 0.2 | |
Foreign currency impact | 0.6 | 0.6 | ||||
Currency-neutral comparable gross margin | 38.3 | % | (0.4 | ) | ||
Reported SGA% | (24.4 | )% | (24.0 | )% | (0.4 | ) |
Mark-to-market (SGA) | 0.1 | (0.1 | ) | 0.2 | ||
Project K and cost reduction activities (SGA) | (1.1 | ) | (0.8 | ) | (0.3 | ) |
Other costs impacting comparability (SGA) | — | 0.9 | (0.9 | ) | ||
Acquisitions/divestitures and integration costs (SGA) | — | — | — | |||
Differences in shipping days (SGA) | — | — | — | |||
Venezuela remeasurement (SGA) | — | — | — | |||
Comparable SGA% | (23.4 | )% | (24.0 | )% | 0.6 | |
Foreign currency impact | (1.8 | ) | (1.8 | ) | ||
Currency-neutral comparable SGA% | (21.6 | )% | 2.4 | |||
Reported operating margin | 13.3 | % | 11.3 | % | 2.0 | |
Mark-to-market | (0.1 | ) | (0.5 | ) | 0.4 | |
Project K and cost reduction activities | (1.9 | ) | (2.2 | ) | 0.3 | |
Other costs impacting comparability | — | 0.9 | (0.9 | ) | ||
Acquisitions/divestitures and integration costs | — | (0.2 | ) | 0.2 | ||
Differences in shipping days | — | — | — | |||
Venezuela remeasurement | (0.2 | ) | (1.4 | ) | 1.2 | |
Comparable operating margin | 15.5 | % | 14.7 | % | 0.8 | |
Foreign currency impact | (1.2 | ) | (1.2 | ) | ||
Currency-neutral comparable operating margin | 16.7 | % | 2.0 |
Quarter ended | Year-to-date period ended | |||||||||||
(dollars in millions) | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | ||||||||
Reported gross profit (a) | $ | 1,270 | $ | 1,241 | $ | 2,515 | $ | 2,486 | ||||
Mark-to-market (COGS) | 16 | 34 | (9 | ) | (34 | ) | ||||||
Project K and cost reduction activities (COGS) | (36 | ) | (65 | ) | (54 | ) | (99 | ) | ||||
Other costs impacting comparability (COGS) | — | — | — | — | ||||||||
Acquisitions/divestitures and integration costs (COGS) | 2 | — | 5 | (6 | ) | |||||||
Venezuela remeasurement (COGS) | (7 | ) | (100 | ) | (12 | ) | (100 | ) | ||||
Comparable gross profit | $ | 1,295 | $ | 1,372 | $ | 2,585 | $ | 2,725 | ||||
Foreign currency impact | (91 | ) | (322 | ) | ||||||||
Currency-neutral comparable gross profit | $ | 1,386 | $ | 2,907 | ||||||||
Reported SGA | $ | 821 | $ | 829 | $ | 1,628 | $ | 1,690 | ||||
Mark-to-market (SGA) | (4 | ) | (1 | ) | (5 | ) | (2 | ) | ||||
Project K and cost reduction activities (SGA) | 36 | 25 | 70 | 59 | ||||||||
Other costs impacting comparability (SGA) | — | (67 | ) | — | (67 | ) | ||||||
Acquisitions/divestitures and integration costs (SGA) | 1 | 3 | 4 | 5 | ||||||||
Venezuela remeasurement (SGA) | — | 3 | 1 | 3 | ||||||||
Comparable SGA | $ | 788 | $ | 866 | $ | 1,558 | $ | 1,692 | ||||
Foreign currency impact | (39 | ) | (79 | ) | ||||||||
Currency-neutral comparable SGA | $ | 827 | $ | 1,637 | ||||||||
Reported operating profit | $ | 449 | $ | 412 | $ | 887 | $ | 796 | ||||
Mark-to-market | 20 | 35 | (4 | ) | (32 | ) | ||||||
Project K and cost reduction activities | (72 | ) | (90 | ) | (124 | ) | (158 | ) | ||||
Other costs impacting comparability | — | 67 | — | 67 | ||||||||
Acquisitions/divestitures and integration costs | 1 | (3 | ) | 1 | (11 | ) | ||||||
Venezuela remeasurement | (7 | ) | (103 | ) | (13 | ) | (103 | ) | ||||
Comparable operating profit | $ | 507 | $ | 506 | $ | 1,027 | $ | 1,033 | ||||
Foreign currency impact | (52 | ) | (243 | ) | ||||||||
Currency-neutral comparable operating profit | $ | 559 | $ | 1,270 |
Quarter ended | Year-to-date period ended | |||||||||||
Consolidated results (dollars in millions, except per share data) | July 2, 2016 | July 4, 2015 | July 2, 2016 | July 4, 2015 | ||||||||
Reported income taxes | $ | 106 | $ | 85 | $ | 153 | $ | 161 | ||||
Mark-to-market | 7 | 13 | 2 | (8 | ) | |||||||
Project K and cost reduction activities | (23 | ) | (26 | ) | (32 | ) | (47 | ) | ||||
Other costs impacting comparability | — | (2 | ) | (54 | ) | (2 | ) | |||||
Acquisitions/divestitures and integration costs | — | (1 | ) | (1 | ) | (3 | ) | |||||
Venezuela remeasurement | — | (20 | ) | — | (20 | ) | ||||||
Comparable income taxes | $ | 122 | $ | 121 | $ | 238 | $ | 241 | ||||
Reported effective income tax rate | 27.4 | % | 27.6 | % | 25.2 | % | 26.4 | % | ||||
Mark-to-market | 0.5 | % | 1.1 | % | 0.5 | % | 0.1 | % | ||||
Project K and cost reduction activities | (1.0 | )% | (0.5 | )% | (0.2 | )% | (0.7 | )% | ||||
Other costs impacting comparability | — | % | (7.4 | )% | (1.7 | )% | (1.9 | )% | ||||
Acquisitions/divestitures and integration costs | — | % | 0.3 | % | (0.1 | )% | 0.2 | % | ||||
Venezuela remeasurement | 0.3 | % | 7.2 | % | 0.3 | % | 2.6 | % | ||||
Comparable effective income tax rate | 27.6 | % | 26.9 | % | 26.4 | % | 26.1 | % |
2016 full year guidance | |||||
Reported effective income tax rate | * | ||||
Mark-to-market | * | ||||
Project K and cost reduction activities | — | % | |||
Other costs impacting comparability | (1 | )% | |||
Acquisitions/divestitures and integration costs | * | ||||
Venezuela remeasurement | * | ||||
Comparable effective income tax rate | Approx. | 27 | % | ||
* Full year guidance for this measure cannot be reasonably estimated as certain information necessary to calculate such measure on a GAAP basis is unavailable, dependent on future events outside of our control and cannot be predicted without unreasonable efforts by the Company. |
Year-to-date period ended | ||||||
(millions) | July 2, 2016 | July 4, 2015 | ||||
Net cash provided by (used in): | ||||||
Operating activities | $ | 648 | $ | 581 | ||
Investing activities | (250 | ) | (333 | ) | ||
Financing activities | (94 | ) | (357 | ) | ||
Effect of exchange rates on cash and cash equivalents | (24 | ) | (40 | ) | ||
Net increase (decrease) in cash and cash equivalents | $ | 280 | $ | (149 | ) |
Year-to-date period ended | |||||||
(millions) | July 2, 2016 | July 4, 2015 | 2016 full year guidance | ||||
Net cash provided by operating activities | $ | 648 | $ | 581 | Approx $1,675 | ||
Additions to properties | (249 | ) | (258 | ) | $525-$625 | ||
Cash flow | $ | 399 | $ | 323 | Approx $1,100 |
• | the ability to implement Project K as planned, whether the expected amount of costs associated with Project K will exceed forecasts, whether the Company will be able to realize the anticipated benefits from Project K in the amounts and times expected; |
• | the ability to realize the benefits we expect from the adoption of zero-based budgeting in the amounts and at the times expected; |
• | the ability to realize the anticipated benefits and synergies from acquired businesses in the amounts and at the times expected; |
• | the impact of competitive conditions; |
• | the effectiveness of pricing, advertising, and promotional programs; |
• | the success of innovation, renovation and new product introductions; |
• | the recoverability of the carrying value of goodwill and other intangibles; |
• | the success of productivity improvements and business transitions; |
• | commodity and energy prices; |
• | labor costs; |
• | disruptions or inefficiencies in supply chain; |
• | the availability of and interest rates on short-term and long-term financing; |
• | actual market performance of benefit plan trust investments; |
• | the levels of spending on systems initiatives, properties, business opportunities, integration of acquired businesses, and other general and administrative costs; |
• | changes in consumer behavior and preferences; |
• | the effect of U.S. and foreign economic conditions on items such as interest rates, statutory tax rates, currency conversion and availability; |
• | legal and regulatory factors including changes in food safety, advertising and labeling laws and regulations; |
• | the ultimate impact of product recalls; |
• | adverse changes in global climate or extreme weather conditions; |
• | business disruption or other losses from natural disasters, war, terrorist acts, or political unrest; and, |
• | the risks and uncertainties described herein under Part II, Item 1A. |
Period | (a) Total Number of Shares Purchased | (b) Average Price Paid Per Share | (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | (d) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs | ||||||
Month #4: | ||||||||||
4/03/16-4/30/16 | 0.5 | $ | 76.50 | 0.5 | $ | 1,254 | ||||
Month #5: | ||||||||||
5/01/16-5/28/16 | 1.9 | $ | 75.62 | 1.9 | $ | 1,114 | ||||
Month #6: | ||||||||||
5/29/16-7/02/16 | — | $ | — | — | $ | 1,114 | ||||
Total | 2.4 | $ | 75.80 | 2.4 |
(a) | Exhibits: |
31.1 | Rule 13a-14(e)/15d-14(a) Certification from John A. Bryant |
31.2 | Rule 13a-14(e)/15d-14(a) Certification from Ronald L. Dissinger |
32.1 | Section 1350 Certification from John A. Bryant |
32.2 | Section 1350 Certification from Ronald L. Dissinger |
101.INS | XBRL Instance Document |
101.SCH | XBRL Taxonomy Extension Schema Document |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
KELLOGG COMPANY |
/s/ Ronald L. Dissinger |
Ronald L. Dissinger |
Principal Financial Officer; Senior Vice President and Chief Financial Officer |
/s/ Donald O. Mondano |
Donald O. Mondano |
Principal Accounting Officer; Vice President and Corporate Controller |
Exhibit No. | Description | Electronic (E) Paper (P) Incorp. By Ref. (IBRF) |
31.1 | Rule 13a-14(e)/15d-14(a) Certification from John A. Bryant | E |
31.2 | Rule 13a-14(e)/15d-14(a) Certification from Ronald L. Dissinger | E |
32.1 | Section 1350 Certification from John A. Bryant | E |
32.2 | Section 1350 Certification from Ronald L. Dissinger | E |
101.INS | XBRL Instance Document | E |
101.SCH | XBRL Taxonomy Extension Schema Document | E |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | E |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | E |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | E |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | E |
1. | I have reviewed this quarterly report on Form 10-Q of Kellogg Company; |
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; |
b) | designed such internal control over financial reporting, or caused such internal control 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; |
c) | 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 |
d) | 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 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 |
a) | 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 |
b) | 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. |
/s/ John A. Bryant | |
Chairman and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Kellogg Company; |
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; |
b) | designed such internal control over financial reporting, or caused such internal control 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; |
c) | 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 |
d) | 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 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 |
a) | 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 |
b) | 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. |
/s/ Ronald L. Dissinger | |
Senior Vice President and Chief Financial Officer |
(1) | the Quarterly Report on Form 10-Q of Kellogg Company for the quarter ended July 2, 2016 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Kellogg Company. |
/s/ John A. Bryant | |
Name: | John A. Bryant |
Title: | Chairman and Chief Executive Officer |
(1) | the Quarterly Report on Form 10-Q of Kellogg Company for the quarter ended July 2, 2016 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) | the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Kellogg Company. |
/s/ Ronald L. Dissinger | |
Name: | Ronald L. Dissinger |
Title: | Senior Vice President and Chief Financial Officer |
Document and Entity Information - shares |
6 Months Ended | |
---|---|---|
Jul. 02, 2016 |
Jul. 30, 2016 |
|
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jul. 02, 2016 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2016 | |
Entity Registrant Name | KELLOGG CO | |
Entity Central Index Key | 0000055067 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 350,259,033 |
Consolidated Balance Sheet (Unaudited) (Parenthetical) - USD ($) $ in Millions |
Jul. 02, 2016 |
Jan. 02, 2016 |
[1] | ||
---|---|---|---|---|---|
Statement of Financial Position [Abstract] | |||||
Property, accumulated depreciation | $ 5,310 | $ 5,236 | |||
Other intangibles, accumulated amortization | $ 51 | $ 47 | |||
Common stock, par value (in dollars per share) | $ 0.25 | $ 0.25 | |||
|
Consolidated Statement of Income (Unaudited) - USD ($) shares in Millions, $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
|
Income Statement [Abstract] | ||||
Net sales | $ 3,268 | $ 3,498 | $ 6,663 | $ 7,054 |
Cost of goods sold | 1,998 | 2,257 | 4,148 | 4,568 |
Selling, general and administrative expense | 821 | 829 | 1,628 | 1,690 |
Operating profit | 449 | 412 | 887 | 796 |
Interest expense | 68 | 58 | 285 | 112 |
Other income (expense), net | 4 | (46) | 4 | (72) |
Income before income taxes | 385 | 308 | 606 | 612 |
Income taxes | 106 | 85 | 153 | 161 |
Earnings (loss) from unconsolidated entities | 1 | (1) | 2 | (2) |
Net income | 280 | 222 | 455 | 449 |
Net income (loss) attributable to noncontrolling interests | 0 | (1) | 0 | (1) |
Net income attributable to Kellogg Company | $ 280 | $ 223 | $ 455 | $ 450 |
Per share amounts: | ||||
Basic (in dollars per share) | $ 0.80 | $ 0.63 | $ 1.30 | $ 1.27 |
Diluted (in dollars per share) | 0.79 | 0.63 | 1.29 | 1.26 |
Dividends per share (in dollars per share) | $ 0.50 | $ 0.49 | $ 1.00 | $ 0.98 |
Average shares outstanding: | ||||
Basic (in shares) | 350 | 353 | 350 | 354 |
Diluted (in shares) | 354 | 355 | 354 | 356 |
Actual shares outstanding at period end (in shares) | 349 | 353 | 349 | 353 |
Consolidated Statement of Comprehensive Income (Unaudited) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 280 | $ 222 | $ 455 | $ 449 |
Other comprehensive income (loss), pre-tax: | ||||
Foreign currency translation adjustments, pre-tax | (48) | 9 | (103) | (54) |
Cash flow hedges, pre-tax: | ||||
Unrealized gain (loss) on cash flow hedges, pre-tax | (3) | (4) | (60) | 4 |
Reclassification to net income, pre-tax | 6 | (3) | 8 | (7) |
Postretirement and postemployment benefit amounts arising during the period, pre-tax: | ||||
Prior service credit (cost), pre-tax | (1) | 1 | (1) | 0 |
Postretirement and postemployment benefits reclassification to net income, pre-tax: | ||||
Net experience loss | 1 | 1 | 2 | 2 |
Prior service cost | 2 | 2 | 2 | 5 |
Other comprehensive income (loss), pre-tax | (43) | 6 | (152) | (50) |
Other comprehensive income (loss), tax (expense) benefit | ||||
Foreign currency translation adjustments, tax (expense) benefit | (16) | 5 | 13 | (16) |
Cash flow hedges, tax (expense) benefit: | ||||
Unrealized gain (loss) on cash flow hedges, tax (expense) benefit | 1 | 0 | 24 | (1) |
Reclassification to net income, tax (expense) benefit | (2) | 0 | (3) | 0 |
Postretirement and postemployment benefit amounts arising during the period, tax (expense) benefit: | ||||
Prior service credit (cost), tax (expense) benefit | 0 | 0 | 0 | 0 |
Postretirement and postemployment benefits reclassification to net income, tax (expense) benefit: | ||||
Net experience loss, tax (expense) benefit | 0 | 0 | 0 | 0 |
Prior service cost, tax (expense) benefit | (1) | (2) | ||
Other comprehensive income (loss), tax (expense) benefit | (17) | 4 | 34 | (19) |
Other comprehensive income (loss), after tax: | ||||
Foreign currency translation adjustments, after-tax | (64) | 14 | (90) | (70) |
Cash flow hedges, after tax | ||||
Unrealized gain (loss) on cash flow hedges, after-tax | (2) | (4) | (36) | 3 |
Reclassification to net income, after-tax | 4 | (3) | 5 | (7) |
Postretirement and postemployment benefit amounts arising during the period, after-tax: | ||||
Prior service credit (cost), after-tax | (1) | 1 | (1) | 0 |
Postretirement and postemployment benefits reclassification to net income, after-tax: | ||||
Net experience loss, after-tax | 1 | 1 | 2 | 2 |
Prior service cost, after-tax | 2 | 1 | 2 | 3 |
Other comprehensive income (loss) | (60) | 10 | (118) | (69) |
Comprehensive income | 220 | 232 | 337 | 380 |
Net income (loss) attributable to noncontrolling interests | 0 | (1) | 0 | (1) |
Other comprehensive income (loss) attributable to noncontrolling interests | 0 | (1) | ||
Comprehensive income attributable to Kellogg Company | $ 220 | $ 233 | $ 337 | $ 382 |
Consolidated Statement of Equity (Unaudited) - USD ($) shares in Millions, $ in Millions |
Total |
Common stock |
Capital in excess of par value |
Retained earnings |
Treasury stock |
Accumulated other comprehensive income (loss) |
Total Kellogg Company equity |
Non-controlling interests |
|||
---|---|---|---|---|---|---|---|---|---|---|---|
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 2,851 | $ 62 | |||||||||
Balance at Jan. 03, 2015 | $ 105 | $ 678 | $ 6,689 | $ (3,470) | $ (1,213) | $ 2,789 | |||||
Balance (in shares) at Jan. 03, 2015 | 420 | 64 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Common stock repurchases (in shares) | 11 | ||||||||||
Common stock repurchases | (731) | $ (731) | (731) | ||||||||
Variable-interest entity impairment | (58) | (58) | |||||||||
Net income | 614 | 614 | 614 | ||||||||
Noncontrolling Interest, Increase from Business Combination | 7 | 7 | |||||||||
Dividends | (700) | (700) | (700) | ||||||||
Other comprehensive loss | (164) | (163) | (163) | (1) | |||||||
Stock compensation | 51 | 51 | 51 | ||||||||
Stock options exercised and other (in shares) | (5) | ||||||||||
Stock options exercised and other | 268 | 16 | (6) | $ 258 | 268 | ||||||
Balance (in shares) at Jan. 02, 2016 | 420 | 70 | |||||||||
Balance at Jan. 02, 2016 | 2,128 | [1] | $ 105 | 745 | 6,597 | $ (3,943) | (1,376) | 2,128 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 2,138 | [1] | 10 | ||||||||
Common stock repurchases (in shares) | 5 | 5 | |||||||||
Common stock repurchases | $ (386) | $ (386) | (386) | ||||||||
Net income | 455 | 455 | 455 | ||||||||
Dividends | (351) | (351) | (351) | ||||||||
Other comprehensive loss | (118) | (118) | (118) | ||||||||
Stock compensation | 30 | 30 | 30 | ||||||||
Stock options exercised and other (in shares) | (4) | ||||||||||
Stock options exercised and other | 232 | (5) | $ 237 | 232 | |||||||
Balance (in shares) at Jul. 02, 2016 | 420 | 71 | |||||||||
Balance at Jul. 02, 2016 | 1,990 | $ 105 | $ 770 | $ 6,701 | $ (4,092) | $ (1,494) | $ 1,990 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 2,000 | $ 10 | |||||||||
|
Consolidated Statement of Cash Flows (Unaudited) - USD ($) $ in Millions |
6 Months Ended | ||||||
---|---|---|---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
||||||
Operating activities | |||||||
Net income | $ 455 | $ 449 | |||||
Adjustments to reconcile net income to operating cash flows: | |||||||
Depreciation and amortization | 251 | 269 | |||||
Postretirement benefit plan expense (benefit) | (56) | (41) | |||||
Deferred income taxes | 7 | (11) | |||||
Stock compensation | 30 | 21 | |||||
Venezuela remeasurement | 11 | 152 | |||||
Variable-interest entity impairment | 0 | (49) | |||||
Other | 0 | 35 | |||||
Postretirement benefit plan contributions | (23) | (17) | |||||
Changes in operating assets and liabilities, net of acquisitions: | |||||||
Trade receivables | (159) | (207) | |||||
Inventories | 17 | 5 | |||||
Accounts payable | 157 | 154 | |||||
Accrued income taxes | 54 | (34) | |||||
Accrued interest expense | (2) | (2) | |||||
Accrued and prepaid advertising and promotion | 10 | 9 | |||||
Accrued salaries and wages | (87) | (61) | |||||
All other current assets and liabilities | (17) | (91) | |||||
Net cash provided by (used in) operating activities | 648 | 581 | |||||
Investing activities | |||||||
Additions to properties | (249) | (258) | |||||
Acquisitions, net of cash acquired | (15) | (117) | |||||
Investments in unconsolidated entities, net proceeds | 29 | 0 | |||||
Other | (15) | 42 | |||||
Net cash provided by (used in) investing activities | (250) | (333) | |||||
Financing activities | |||||||
Net issuances (reductions) of notes payable | (424) | 114 | |||||
Issuances of long-term debt | 2,061 | 672 | |||||
Reductions of long-term debt | (1,227) | (606) | |||||
Net issuances of common stock | 233 | 90 | |||||
Common stock repurchases | (386) | (285) | |||||
Cash dividends | (351) | (347) | |||||
Other | 0 | 5 | |||||
Net cash provided by (used in) financing activities | (94) | (357) | |||||
Effect of exchange rate changes on cash and cash equivalents | (24) | (40) | |||||
Increase (decrease) in cash and cash equivalents | 280 | (149) | |||||
Cash and cash equivalents at beginning of period | 251 | [1] | 443 | ||||
Cash and cash equivalents at end of period | 531 | 294 | |||||
Supplemental cash flow disclosures | |||||||
Interest paid | 284 | 114 | |||||
Income taxes paid | 85 | 240 | |||||
Capital expenditures incurred but not yet paid | 40 | ||||||
Supplemental cash flow dislcosures of non-cash activities [Abstract] | |||||||
Additions to properties included in accounts payable | [2] | $ 89 | $ 96 | ||||
|
Accounting Policies |
6 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||
Accounting Policies [Abstract] | |||||||||||||
Accounting Policies | Accounting policies Basis of presentation The unaudited interim financial information of Kellogg Company (the Company) included in this report reflects all adjustments, all of which are of a normal and recurring nature, that management believes are necessary for a fair statement of the results of operations, comprehensive income, financial position, equity and cash flows for the periods presented. This interim information should be read in conjunction with the financial statements and accompanying footnotes within the Company’s 2015 Annual Report on Form 10-K. The condensed balance sheet information at January 2, 2016 was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States. The results of operations for the quarterly period ended July 2, 2016 are not necessarily indicative of the results to be expected for other interim periods or the full year. Accounts payable The Company has an agreement with a third party to provide an accounts payable tracking system which facilitates participating suppliers’ ability to monitor and, if elected, sell payment obligations from the Company to designated third-party financial institutions. Participating suppliers may, at their sole discretion, make offers to sell one or more payment obligations of the Company prior to their scheduled due dates at a discounted price to participating financial institutions. The Company’s goal in entering into this agreement is to capture overall supplier savings, in the form of payment terms or vendor funding, created by facilitating suppliers’ ability to sell payment obligations, while providing them with greater working capital flexibility. We have no economic interest in the sale of these suppliers’ receivables and no direct financial relationship with the financial institutions concerning these services. The Company’s obligations to its suppliers, including amounts due and scheduled payment dates, are not impacted by suppliers’ decisions to sell amounts under this arrangement. However, the Company’s right to offset balances due from suppliers against payment obligations is restricted by this agreement for those payment obligations that have been sold by suppliers. As of July 2, 2016, $622 million of the Company’s outstanding payment obligations had been placed in the accounts payable tracking system, and participating suppliers had sold $475 million of those payment obligations to participating financial institutions. As of January 2, 2016, $501 million of the Company’s outstanding payment obligations had been placed in the accounts payable tracking system, and participating suppliers had sold $407 million of those payment obligations to participating financial institutions. New accounting standards Improvements to employee share-based payment accounting. In March 2016, the Financial Accounting Standards Board (FASB) issued an Accounting Standards Update (ASU) as part of its simplification initiative. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. Early adoption is permitted. The Company early adopted the accounting standard update in the first quarter of 2016. The ASU includes multiple provisions intended to simplify various aspects of the accounting for share-based payments. The main provisions of the ASU are as follows:
Balance sheet classification of deferred taxes. In November 2015, the FASB issued an ASU to simplify the presentation of deferred income taxes. The ASU requires that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. Entities should apply the new guidance either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. Early adoption is permitted. The Company early adopted the updated standard in the first quarter of 2016, on a prospective basis. The year-end 2015 balances for current deferred tax assets and current deferred liabilities was $227 million and $9 million, respectively. Prior period balances have not been adjusted. Simplifying the presentation of debt issuance costs. In April 2015, the FASB issued an ASU to simplify the presentation of debt issuance costs. The ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Early adoption was permitted. Entities should apply the new guidance on a retrospective basis. The Company adopted the updated standard in the first quarter of 2016 with no significant impact on its financial statements. Simplifying the accounting for measurement-period adjustments. In September 2015, the FASB issued an ASU to simplify the accounting for measurement-period adjustments for items in a business combination. The ASU requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Entities should apply the new guidance prospectively to adjustments to provisional amounts that occur after the effective date of the ASU with earlier application permitted for financial statements that have not been issued. The Company adopted the updated standard in the first quarter of 2016 with no significant impact on its financial statements. Customer's accounting for fees paid in a cloud computing arrangement. In April 2015, the FASB issued an ASU to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted. Entities should apply the new guidance either; 1) prospectively to all arrangements entered into or materially modified after the effective date or 2) retrospectively. The Company adopted the updated standard prospectively in the first quarter of 2016 with no significant impact on its financial statements. Accounting standards to be adopted in future periods Leases. In February 2016, the FASB issued an ASU which will require the recognition of lease assets and lease liabilities by lessees for all leases with terms greater than 12 months. The distinction between finance leases and operating leases will remain, with similar classification criteria as current GAAP to distinguish between capital and operating leases. The principal difference from current guidance is that the lease assets and lease liabilities arising from operating leases will be recognized on the Consolidated Balance Sheet. Lessor accounting remains substantially similar to current GAAP. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. Early adoption is permitted. The Company is currently evaluating the impact that implementing this ASU will have on its financial statements and disclosures, as well as timing of implementation. Recognition and measurement of financial assets and liabilities. In January 2016, the FASB issued an ASU which primarily affects the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption can be elected for all financial statements of fiscal years and interim periods that have not yet been issued or that have not yet been made available for issuance. Entities should apply the update by means of a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. The Company will adopt the updated standard in the first quarter of 2018. The Company does not expect the adoption of this guidance to have a significant impact on its financial statements. Revenue from contracts with customers. In May 2014, the FASB issued an ASU which provides guidance for accounting for revenue from contracts with customers. The core principle of this ASU is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration the entity expects to be entitled to in exchange for those goods or services. To achieve that core principle, an entity would be required to apply the following five steps: 1) identify the contract(s) with a customer; 2) identify the performance obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to the performance obligations in the contract and 5) recognize revenue when (or as) the entity satisfies a performance obligation. When the ASU was originally issued it was effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, and early adoption was not permitted. On July 9, 2015, the FASB decided to delay the effective date of the new revenue standard by one year. The updated standard will be effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Entities will be permitted to adopt the new revenue standard early, but not before the original effective date. Entities will have the option to apply the final standard retrospectively or use a modified retrospective method, recognizing the cumulative effect of the ASU in retained earnings at the date of initial application. An entity will not restate prior periods if it uses the modified retrospective method, but will be required to disclose the amount by which each financial statement line item is affected in the current reporting period by the application of the ASU as compared to the guidance in effect prior to the change, as well as reasons for significant changes. The Company will adopt the updated standard in the first quarter of 2018. The Company is currently evaluating the impact that implementing this ASU will have on its financial statements and disclosures, as well as whether it will use the retrospective or modified retrospective method of adoption. |
Sale of Accounts Receivable |
6 Months Ended |
---|---|
Jul. 02, 2016 | |
Receivables [Abstract] | |
Financing Receivables [Text Block] | Sale of accounts receivable In March 2016, the Company entered into an agreement (the “Receivable Sales Agreement”), to sell, on a revolving basis, certain trade accounts receivable balances to a third party financial institution. Transfers under this agreement are accounted for as sales of receivables resulting in the receivables being de-recognized from the Consolidated Balance Sheet. The Receivable Sales Agreement provides for the continuing sale of certain receivables on a revolving basis until terminated by either party; however the maximum receivables that may be sold at any time is $550 million (increased from $350 million as of April 2, 2016). During the year-to-date period ended July 2, 2016, $529 million of accounts receivable have been sold via this arrangement. Accounts receivable sold of $517 million remained outstanding under this arrangement as of July 2, 2016. The proceeds from these sales of receivables are included in cash from operating activities in the consolidated statement of cash flows. The recorded net loss on sale of receivables is included in other income and expense and is not material. The Company has no retained interests in the receivables sold, however the Company does have collection and administrative responsibilities for the sold receivables. The Company has not recorded any servicing assets or liabilities as of July 2, 2016 for this agreement as the fair value of these servicing arrangements as well as the fees earned were not material to the financial statements. |
Goodwill and Other Intangible Assets |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisitions, Goodwill and Other Intangible Assets [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Other Intangible Assets | Goodwill and other intangible assets Acquisition In March 2016, the Company completed the acquisition of an organic and natural snack company for $18 million, which was accounted for under the purchase method and financed with cash on hand. The assets, which primarily consist of indefinite lived brands, and liabilities are included in the Consolidated Balance Sheet as of July 2, 2016 within the North America Other segment. Joint Venture In January 2016, the Company formed a Joint Venture with Tolaram Africa to develop snacks and breakfast foods for the West Africa market. In connection with the formation, the Company contributed the rights to indefinitely use the Company’s brands in these categories, including the Pringles brand. Accordingly, the Company recorded a contribution of $5 million of intangible assets not subject to amortization with a corresponding increase in Investments in unconsolidated entities during the year-to-date period ended July 2, 2016, which represents the value attributed to the Pringles brand for this market. Carrying amount of goodwill
Intangible assets subject to amortization (millions)
For intangible assets in the preceding table, amortization was $4 million for the year-to-date periods ended July 2, 2016 and July 4, 2015. The currently estimated aggregate annual amortization expense for full-year 2016 is approximately $7 million. Intangible assets not subject to amortization
|
Investment in Unconsolidated Entities |
6 Months Ended |
---|---|
Jul. 02, 2016 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments and Joint Ventures Disclosure [Text Block] | Investments in unconsolidated entities In September 2015, the Company acquired, for $445 million, a 50% interest in Multipro Singapore Pte. Ltd. (Multipro), a leading distributor of a variety of food products in Nigeria and Ghana and also obtained an option to acquire 24.5% of an affiliated food manufacturing entity under common ownership based on a fixed multiple of future earnings as defined in the agreement (Purchase Option). The purchase price was subject to final adjustments based on Multipro’s 2015 earnings, as defined in the agreement, which was finalized during the quarter ended July 2, 2016. The final purchase price adjustment resulted in a $28 million reduction in the purchase price, which reduced the carrying amount of the investment. The acquisition of the 50% interest is accounted for under the equity method of accounting. The Purchase Option, which was recorded at cost and will be monitored for impairment through the exercise period, which is upon the earlier of the entity achieving a minimum level of earnings as defined in the agreement, in which case the Company has a one year exercise period, or 2020. The difference between the amount paid for Multipro and the underlying equity in net assets is primarily attributable to intangible assets, a portion of which will be amortized in future periods, and goodwill. |
Restructuring and Cost Reduction Activities |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Cost Reduction Activities | Restructuring and cost reduction activities The Company views its continued spending on restructuring and cost reduction activities as part of its ongoing operating principles to provide greater visibility in achieving its long-term profit growth targets. Initiatives undertaken are currently expected to recover cash implementation costs within a five-year period of completion. Upon completion (or as each major stage is completed in the case of multi-year programs), the project begins to deliver cash savings and/or reduced depreciation. Project K Project K, a four-year efficiency and effectiveness program, was announced in November 2013, and is expected to continue generating a significant amount of savings that may be invested in key strategic areas of focus for the business. Additionally, the Company expects that these savings may be used to drive future growth in the business. The focus of the program is to strengthen existing businesses in core markets, increase growth in developing and emerging markets, and drive an increased level of value-added innovation. The program is expected to continue to provide a number of benefits, including an optimized supply chain infrastructure, the implementation of global business services, and a new global focus on categories. The Company currently anticipates that Project K will result in total pre-tax charges, once all phases are approved and implemented, of $1.2 to $1.4 billion, with after-tax cash costs, including incremental capital investments, estimated to be $900 million to $1.1 billion. Based on current estimates and actual charges to date, the Company expects the total project charges will consist of asset-related costs totaling $400 to $450 million which will consist primarily of asset impairments, accelerated depreciation and other exit-related costs; employee-related costs totaling $400 to $450 million which will include severance, pension and other termination benefits; and other costs totaling $400 to $500 million which will consist primarily of charges related to the design and implementation of global business capabilities. A significant portion of other costs are the result of the implementation of global business service centers which are intended to simplify and standardize business support processes. The Company currently expects that total pre-tax charges will impact reportable segments as follows: U.S. Morning Foods (approximately 18%), U.S. Snacks (approximately 17%), U.S. Specialty (approximately 1%), North America Other (approximately 10%), Europe (approximately 17%), Latin America (approximately 2%), Asia-Pacific (approximately 6%), and Corporate (approximately 29%). Certain costs impacting Corporate relate to additional initiatives to be approved and executed in the future. When these initiatives are fully defined and approved, the Company will update its estimated costs by reportable segment as needed. Since the inception of Project K, the Company has recognized charges of $924 million that have been attributed to the program. The charges consist of $6 million recorded as a reduction of revenue, $571 million recorded in COGS and $347 million recorded in SGA. Other Projects In 2015 the Company initiated the implementation of a zero-based budgeting (ZBB) program in its North America business that is expected to deliver visibility to ongoing annual savings. During 2016 ZBB was expanded to include the international segments of the business. In support of the ZBB initiative, the Company incurred pre-tax charges of approximately $12 million and $17 million during the quarter and year-to-date period ended July 2, 2016, respectively. Total charges of $29 million have been recognized since the inception of the ZBB program. Total Projects During the quarter ended July 2, 2016, the Company recorded total charges of $72 million across all restructuring and cost reduction activities. The charges were comprised of $36 million recorded in cost of goods sold (COGS) and $36 million recorded in selling, general and administrative (SGA) expense. During the year-to-date period ended July 2, 2016, the Company recorded total charges of $124 million across all restructuring and cost reduction activities. The charges consist of $54 million recorded in COGS and $70 million recorded in SGA expense. During the quarter ended July 4, 2015, the Company recorded total charges of $90 million across all restructuring and cost reduction activities. The charges consist of $65 million recorded in COGS and $25 million recorded in SGA expense. During the year-to-date period ended July 4, 2015, the Company recorded total charges of $158 million across all restructuring and cost reduction activities. The charges consist of $2 million recorded as a reduction of revenue, $97 million recorded in COGS and $59 million recorded in SGA expense. The tables below provide the details for charges across all restructuring and cost reduction activities incurred during the quarter and year-to-date periods ended July 2, 2016 and July 4, 2015 and program costs to date for programs currently active as of July 2, 2016.
For the quarters ended July 2, 2016 and July 4, 2015 employee related costs consist primarily of severance benefits, asset related costs consist primarily of accelerated depreciation, and other costs consist primarily of third-party incremental costs related to the development and implementation of global business capabilities. At July 2, 2016 total exit cost reserves were $70 million, related to severance payments and other costs of which a substantial portion will be paid out in 2016 and 2017. The following table provides details for exit cost reserves.
|
Equity |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity | Equity Earnings per share Basic earnings per share is determined by dividing net income attributable to Kellogg Company by the weighted average number of common shares outstanding during the period. Diluted earnings per share is similarly determined, except that the denominator is increased to include the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued. Dilutive potential common shares consist principally of employee stock options issued by the Company, and to a lesser extent, certain contingently issuable performance shares. Basic earnings per share is reconciled to diluted earnings per share in the following table. There were 3 million and 2 million anti-dilutive potential common shares excluded from the reconciliation for the quarter and year-to-date periods ended July 2, 2016, respectively. There were 3 million and 2 million anti dilutive potential common shares excluded from the reconciliation for the quarter and year-to-date periods ended July 4, 2015, respectively. Quarters ended July 2, 2016 and July 4, 2015:
Year-to-date periods ended July 2, 2016 and July 4, 2015:
In February 2014, the Company's board of directors approved a share repurchase program authorizing the repurchase of up to $1.5 billion of our common stock through December 2015. In December 2015, the board of directors approved a new authorization to repurchase of up to $1.5 billion of our common stock beginning in 2016 through December 2017. During the year-to-date period ended July 2, 2016, the Company repurchased approximately 5 million shares of common stock for a total of $386 million. During the year-to-date period ended July 4, 2015, the Company repurchased 4 million shares of common stock for a total of $285 million. Comprehensive income Comprehensive income includes net income and all other changes in equity during a period except those resulting from investments by or distributions to shareholders. Other comprehensive income consists of foreign currency translation adjustments, fair value adjustments associated with cash flow hedges and adjustments for net experience losses and prior service cost related to employee benefit plans. Reclassifications out of Accumulated Other Comprehensive Income (AOCI) for the quarter and year-to-date periods ended July 2, 2016 consisted of the following:
Reclassifications out of Accumulated Other Comprehensive Income (AOCI) for the quarter and year-to-date periods ended July 4, 2015 consisted of the following:
Accumulated other comprehensive income (loss) as of July 2, 2016 and January 2, 2016 consisted of the following:
Noncontrolling interests In December 2012, the Company entered into a series of agreements with a third party including a subordinated loan (VIE Loan) of $44 million which is convertible into approximately 85% of the equity of the entity (VIE). Due to this convertible subordinated loan and other agreements, the Company determined that the entity was a variable interest entity, the Company is the primary beneficiary and the Company has consolidated the financial statements of the VIE. The results of the VIE’s operations are included in the Consolidated Statements of Income for the six months period ended July 4, 2015. During the quarter ended April 4, 2015, the Company determined that certain assets related to the VIE may not be fully recoverable and recorded a non-cash charge of $25 million, which was recorded as other income (expense), net. During the quarter ended July 4, 2015, the 2012 Agreements were terminated and the VIE loan, including related accrued interest and other receivables, were settled, resulting in a partial reversal of the prior quarter charge of $6 million for the quarter ended July 4, 2015. The net charge in the year-to-date period ended July 4, 2015 of $19 million was recorded in Other income (expense), net. Upon termination of the 2013 Agreements, the Company is no longer considered the primary beneficiary of the VIE and accordingly, the VIE was deconsolidated as of July 4, 2015. In connection with the deconsolidation, the Company derecognized all assets and liabilities of the VIE, including an allocation of a portion of goodwill from the U.S. Snacks operating segment, resulting in a $67 million non-cash gain, which was recorded within SGA expense for the quarter ended July 4, 2015. |
Debt |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt The following table presents the components of notes payable at July 2, 2016 and January 2, 2016:
(a) Negative effective interest rates on certain borrowings in Europe are the result of efforts by the European Central Bank to stimulate the economy in the eurozone. In May 2016, the Company issued €600 million (approximately $664 million USD at July 2, 2016, which reflects the discount and translation adjustments) of eight-year 1.00% Euro Notes due 2024, resulting in aggregate net proceeds after debt discount of $679 million . The proceeds from these Notes were used for general corporate purposes, including, together with cash on hand and additional commercial paper borrowings, repayment of the Company's $750 million, five-year 4.45% U.S. Dollar Notes due 2016 at maturity. The Notes contain customary covenants that limit the ability of the Company and its restricted subsidiaries (as defined) to incur certain liens or enter into certain sale and lease-back transactions, as well as a change of control provision. The Notes were designated as a net investment hedge of the Company's investment in its Europe subsidiary when issued. In the second quarter of 2016 the Company entered into interest rate swaps with notional amounts totaling approximately $958 million and €600 million which effectively converted $600 million of its 4.0% ten-year U.S. Dollar Notes due 2020, $358 million of its 3.125% U.S. Dollar Notes due 2022 and €600 million of its 1.00% Euro Notes due 2024 from fixed to floating rate obligations. The U.S. Dollar interest rate swaps were settled during the quarter for an unrealized gain of $12 million which will be amortized to interest expense over the remaining term of the related Notes. In March 2016, the Company redeemed $475 million of its 7.45% U.S. Dollar Debentures due 2031. In connection with the debt redemption, the Company incurred $153 million of interest expense, consisting primarily of a premium on the tender offer and also including accelerated losses on pre-issuance interest rate hedges, acceleration of fees and debt discount on the redeemed debt and fees related to the tender offer. In March 2016, the Company issued $750 million of ten-year 3.25% U.S. Dollar Notes and $650 million of thirty-year 4.5% U.S. Dollar Notes, resulting in aggregate net proceeds after debt discount of $1.382 billion. The proceeds from these Notes were used for general corporate purposes, which included repayment of a portion of the Company’s 7.45% U.S. Dollar Debentures due 2031 and a portion of its commercial paper borrowings. The Notes contain customary covenants that limit the ability of the Company and its restricted subsidiaries (as defined) to incur certain liens or enter into certain sale and lease-back transactions, as well as a change of control provision. The effective interest rates on debt obligations resulting from the Company’s interest rate swaps as of July 2, 2016 were as follows: (a) five-year 1.875% U.S. Dollar Notes due 2016 – 1.91%; (b) five-year 1.75% U.S. Dollar Notes due 2017 – 1.83%; (c) seven-year 3.25% U.S. Dollar Notes due 2018 – 2.58%; (d) ten-year 4.15% U.S. Dollar Notes due 2019 – 3.55%; (e) ten-year 4.00% U.S. Dollar Notes due 2020 – 2.99%; (f) ten-year 3.125% U.S. Dollar Notes due 2022 – 2.51%; (g) eight-year 1.00% Euro Notes due 2024 - 0.82%. |
Stock Compensation |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Compensation | Stock compensation The Company uses various equity-based compensation programs to provide long-term performance incentives for its global workforce. Currently, these incentives consist principally of stock options, restricted stock units, and to a lesser extent, executive performance shares and restricted stock grants. The Company also sponsors a discounted stock purchase plan in the United States and matching-grant programs in several international locations. Additionally, the Company awards restricted stock to its outside directors. The interim information below should be read in conjunction with the disclosures included within the stock compensation footnote of the Company’s 2015 Annual Report on Form 10-K. The Company classifies pre-tax stock compensation expense in COGS and SGA expense principally within its corporate operations. For the periods presented, compensation expense for all types of equity-based programs and the related income tax benefit recognized was as follows:
As of July 2, 2016, total stock-based compensation cost related to non-vested awards not yet recognized was $115 million and the weighted-average period over which this amount is expected to be recognized was 2 years. Stock options During the year-to-date periods ended July 2, 2016 and July 4, 2015, the Company granted non-qualified stock options to eligible employees as presented in the following activity tables. Terms of these grants and the Company’s methods for determining grant-date fair value of the awards were consistent with that described within the stock compensation footnote in the Company’s 2015 Annual Report on Form 10-K. Year-to-date period ended July 2, 2016:
Year-to-date period ended July 4, 2015:
The weighted-average fair value of options granted was $9.44 per share and $7.20 per share for the year-to-date periods ended July 2, 2016 and July 4, 2015, respectively. The fair value was estimated using the following assumptions:
The total intrinsic value of options exercised was $79 million and $23 million for the year-to-date periods ended July 2, 2016 and July 4, 2015, respectively. Performance shares In the first quarter of 2016, the Company granted performance shares to a limited number of senior executive-level employees, which entitle these employees to receive a specified number of shares of the Company’s common stock upon vesting. The number of shares earned could range between 0 and 200% of the target amount depending upon performance achieved over the three year vesting period. The performance conditions of the award include three-year currency-neutral comparable operating profit growth and total shareholder return (TSR) of the Company’s common stock relative to a select group of peer companies. A Monte Carlo valuation model was used to determine the fair value of the awards. The TSR performance metric is a market condition. Therefore, compensation cost of the TSR condition is fixed at the measurement date and is not revised based on actual performance. The TSR metric was valued as a multiplier of possible levels of comparable operating profit growth achievement. Compensation cost related to comparable operating profit growth performance is revised for changes in the expected outcome. The 2016 target grant currently corresponds to approximately 188,000 shares, with a grant-date fair value of $76 per share. Based on the market price of the Company’s common stock at July 2, 2016, the maximum future value that could be awarded to employees on the vesting date for all outstanding performance share awards was as follows:
The 2013 performance share award, payable in stock, was settled at 35% of target in February 2016 for a total dollar equivalent of $3 million. Other stock-based awards During the year-to-date period ended July 2, 2016, the Company granted restricted stock units and a nominal number of restricted stock awards to eligible employees as presented in the following table. Terms of these grants and the Company’s method of determining grant-date fair value were consistent with that described within the stock compensation footnote in the Company’s 2015 Annual Report on Form 10-K. Year-to-date period ended July 2, 2016:
Year-to-date period ended July 4, 2015:
|
Employee Benefits |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Compensation and Retirement Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Benefits | Employee benefits The Company sponsors a number of U.S. and foreign pension plans as well as other nonpension postretirement and postemployment plans to provide various benefits for its employees. These plans are described within the footnotes to the Consolidated Financial Statements included in the Company’s 2015 Annual Report on Form 10-K. Components of Company plan benefit expense for the periods presented are included in the tables below. Pension
Other nonpension postretirement
Postemployment
Company contributions to employee benefit plans are summarized as follows:
Plan funding strategies may be modified in response to management’s evaluation of tax deductibility, market conditions, and competing investment alternatives. |
Income Taxes |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income taxes The consolidated effective tax rate for the quarter ended July 2, 2016 was 27% as compared to the prior year’s rate of 28%. The consolidated effective tax rates for the year-to-date periods ended July 2, 2016 and July 4, 2015 were 25% and 26%, respectively. The effective rate for the first half of 2016 benefited from excess tax benefits from share-based compensation as well as a benefit related to an audit closure. See Note 1 for further discussion regarding the ASU adoption. The effective tax rate for 2015 benefited from a reduction in tax related to current year remitted and unremitted earnings and the completion of certain tax examinations. As of July 2, 2016, the Company classified $14 million of unrecognized tax benefits as a net current liability. Management’s estimate of reasonably possible changes in unrecognized tax benefits during the next twelve months consists of the current liability balance expected to be settled within one year, offset by approximately $8 million of projected additions related primarily to ongoing intercompany transfer pricing activity. Management is currently unaware of any issues under review that could result in significant additional payments, accruals or other material deviation in this estimate. Following is a reconciliation of the Company’s total gross unrecognized tax benefits for the year-to-date period ended July 2, 2016; $50 million of this total represents the amount that, if recognized, would affect the Company’s effective income tax rate in future periods.
For the quarter and year-to-date periods ended July 2, 2016, the Company recognized an increase of $1 million and $2 million, respectively, for tax-related interest. During the year-to-date period ended July 4, 2015, the Company recognized tax-related interest and penalties netting to zero. The accrual balance was $19 million at July 2, 2016. |
Derivative Instruments and Fair Value Measurements |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Fair Value Measurements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Fair Value Measurements | Derivative instruments and fair value measurements The Company is exposed to certain market risks such as changes in interest rates, foreign currency exchange rates, and commodity prices, which exist as a part of its ongoing business operations. Management uses derivative financial and commodity instruments, including futures, options, and swaps, where appropriate, to manage these risks. Instruments used as hedges must be effective at reducing the risk associated with the exposure being hedged. The Company designates derivatives as cash flow hedges, fair value hedges, net investment hedges, and uses other contracts to reduce volatility in interest rates, foreign currency and commodities. As a matter of policy, the Company does not engage in trading or speculative hedging transactions. Total notional amounts of the Company’s derivative instruments as of July 2, 2016 and January 2, 2016 were as follows:
Following is a description of each category in the fair value hierarchy and the financial assets and liabilities of the Company that were included in each category at July 2, 2016 and January 2, 2016, measured on a recurring basis. Level 1 – Financial assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market. For the Company, level 1 financial assets and liabilities consist primarily of commodity derivative contracts. Level 2 – Financial assets and liabilities whose values are based on quoted prices in markets that are not active or model inputs that are observable either directly or indirectly for substantially the full term of the asset or liability. For the Company, level 2 financial assets and liabilities consist of interest rate swaps and over-the-counter commodity and currency contracts. The Company’s calculation of the fair value of interest rate swaps is derived from a discounted cash flow analysis based on the terms of the contract and the interest rate curve. Over-the-counter commodity derivatives are valued using an income approach based on the commodity index prices less the contract rate multiplied by the notional amount. Foreign currency contracts are valued using an income approach based on forward rates less the contract rate multiplied by the notional amount. The Company’s calculation of the fair value of level 2 financial assets and liabilities takes into consideration the risk of nonperformance, including counterparty credit risk. Level 3 – Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect management’s own assumptions about the assumptions a market participant would use in pricing the asset or liability. The Company did not have any level 3 financial assets or liabilities as of July 2, 2016 or January 2, 2016. The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheet on a recurring basis as of July 2, 2016 and January 2, 2016: Derivatives designated as hedging instruments
(a) The fair value of the related hedged portion of the Company's long-term debt, a level 2 liability, was $668 million as of July 2, 2016. Derivatives not designated as hedging instruments
The Company has designated a portion of its outstanding foreign currency denominated long-term debt as a net investment hedge of a portion of the Company’s investment in its subsidiaries’ foreign currency denominated net assets. The carrying value of this debt was approximately $1.9 billion and $1.2 billion as of July 2, 2016 and January 2, 2016, respectively. The Company has elected not to offset the fair values of derivative assets and liabilities executed with the same counterparty that are generally subject to enforceable netting agreements. However, if the Company were to offset and record the asset and liability balances of derivatives on a net basis, the amounts presented in the Consolidated Balance Sheet as of July 2, 2016 and January 2, 2016 would be adjusted as detailed in the following table:
The effect of derivative instruments on the Consolidated Statements of Income and Comprehensive Income for the quarters ended July 2, 2016 and July 4, 2015 was as follows: Derivatives in fair value hedging relationships
Derivatives in cash flow hedging relationships
Derivatives and non-derivatives in net investment hedging relationships
Derivatives not designated as hedging instruments
The effect of derivative instruments on the Consolidated Statements of Income and Comprehensive Income for the year-to-date periods ended July 2, 2016 and July 4, 2015 was as follows: Derivatives in fair value hedging relationships
(a) Includes the ineffective portion and amount excluded from effectiveness testing. Derivatives in cash flow hedging relationships
(a) Includes the ineffective portion and amount excluded from effectiveness testing. Derivatives and non-derivatives in net investment hedging relationships
Derivatives not designated as hedging instruments
During the next 12 months, the Company expects $9 million of net deferred losses reported in AOCI at July 2, 2016 to be reclassified to income, assuming market rates remain constant through contract maturities. Certain of the Company’s derivative instruments contain provisions requiring the Company to post collateral on those derivative instruments that are in a liability position if the Company’s credit rating is at or below BB+ (S&P), or Baa1 (Moody’s). The fair value of all derivative instruments with credit-risk-related contingent features in a liability position on July 2, 2016 was $5 million. If the credit-risk-related contingent features were triggered as of July 2, 2016, the Company would be required to post collateral of $5 million. In addition, certain derivative instruments contain provisions that would be triggered in the event the Company defaults on its debt agreements. There were no collateral posting requirements as of July 2, 2016 triggered by credit-risk-related contingent features. 2016 fair value measurements on a nonrecurring basis As part of Project K, the Company will be consolidating the usage of and disposing certain long-lived assets, including manufacturing facilities and Corporate owned assets over the term of the program. See Note 5 for more information regarding Project K. During the quarter ended July 2, 2016, long-lived assets of $26 million related to a manufacturing facility in the Company's US Snacks reportable segment, were written down to an estimated fair value of $10 million due to Project K activities. The Company's calculation of the fair value of these long-lived assets is based on level 3 inputs, including market comparables, market trends and the condition of the assets. The following table presents level 3 assets that were measured at fair value on the consolidated Balance Sheet on a nonrecurring basis as of July 2, 2016:
2015 fair value measurements on a nonrecurring basis During the quarter ended July 4, 2015, as part of Project K, long-lived assets of $31 million related to a manufacturing facility in the Company's North America Other reportable segment, were written down to an estimated fair value of $13 million due to Project K activities. The Company's calculation of the fair value of these long-lived assets is based on level 3 inputs, including market comparables, market trends and the condition of the assets. During the quarter ended July 4, 2015, the Company moved from the CENCOEX foreign currency official exchange rate to the SIMADI foreign currency exchange rate for purposes of remeasuring the financial statements of its Venezuelan subsidiary. In connection with this change in foreign currency exchange rates, the Company also evaluated the carrying value of the long lived assets related to its Venezuelan subsidiary. See Note 13 for more information regarding Venezuela. During the quarter-ended July 4, 2015 long-lived assets with a carrying value of $51 million were written down to an estimated fair value of $2 million. The Company's calculation of the fair value of these long-lived assets is based on level 3 inputs, including market comparables, market trends and the condition of the assets. The following table presents level 3 assets that were measured at fair value on the consolidated Balance Sheet on a nonrecurring basis as of July 4, 2015:
Financial instruments The carrying values of the Company’s short-term items, including cash, cash equivalents, accounts receivable, accounts payable and notes payable approximate fair value. The fair value of the Company’s long-term debt, which are level 2 liabilities, is calculated based on broker quotes and was as follows at July 2, 2016:
Counterparty credit risk concentration and collateral requirements The Company is exposed to credit loss in the event of nonperformance by counterparties on derivative financial and commodity contracts. Management believes a concentration of credit risk with respect to derivative counterparties is limited due to the credit ratings and use of master netting and reciprocal collateralization agreements with the counterparties and the use of exchange-traded commodity contracts. Master netting agreements apply in situations where the Company executes multiple contracts with the same counterparty. Certain counterparties represent a concentration of credit risk to the Company. If those counterparties fail to perform according to the terms of derivative contracts, this would result in a loss to the Company. As of July 2, 2016, the Company was not in a significant net asset position with any counterparties with which a master netting agreement would apply. For certain derivative contracts, reciprocal collateralization agreements with counterparties call for the posting of collateral in the form of cash, treasury securities or letters of credit if a fair value loss position to the Company or its counterparties exceeds a certain amount. In addition, the Company is required to maintain cash margin accounts in connection with its open positions for exchange-traded commodity derivative instruments executed with the counterparty that are subject to enforceable netting agreements. As of July 2, 2016, the Company had no collateral posting requirements related to reciprocal collateralization agreements. As of July 2, 2016 the Company posted $27 million in margin deposits for exchange-traded commodity derivative instruments, which was reflected as an increase in accounts receivable, net on the Consolidated Balance Sheet. Management believes concentrations of credit risk with respect to accounts receivable is limited due to the generally high credit quality of the Company’s major customers, as well as the large number and geographic dispersion of smaller customers. However, the Company conducts a disproportionate amount of business with a small number of large multinational grocery retailers, with the five largest accounts encompassing approximately 24% of consolidated trade receivables at July 2, 2016. |
Contingencies |
6 Months Ended |
---|---|
Jul. 02, 2016 | |
Loss Contingency [Abstract] | |
Contingencies | Contingencies In connection with the Company’s previous labor negotiations with the union representing the work-force at its Memphis, TN cereal production facility, the National Labor Relations Board (NLRB) filed a complaint alleging unfair labor practices under the National Labor Relations Act in March 2014. In July 2014, a U.S. District Court judge ruled that the Memphis employees were entitled to return to work while the underlying litigation continues and employees subsequently returned to work. In August 2014, an NLRB Administrative Law Judge dismissed the complaint that initiated the underlying litigation. In May 2015, the NLRB reversed the decision of the Administrative Law Judge in favor of the union. The Company is appealing this decision and the case continues. This litigation is not expected to have a material effect on the production or distribution of products from the Memphis, TN facility or a material financial impact on the Company. As of July 2, 2016, the Company has not recorded a liability related to this matter as an adverse outcome is not considered probable. The Company will continue to evaluate the likelihood of potential outcomes for this case as the litigation continues. |
Venezuela |
6 Months Ended |
---|---|
Jul. 02, 2016 | |
Foreign Currency [Abstract] | |
Venezuela | Venezuela Venezuela is considered a highly inflationary economy. As such, the functional currency for the Company's operations in Venezuela is the U.S. dollar, which in turn, requires bolivar denominated monetary assets and liabilities to be remeasured into U.S. dollars using an exchange rate at which such balances could be settled as of the balance sheet date. In addition, revenues and expenses are recorded in U.S. dollars at an appropriate rate on the date of the transaction. Gains and losses resulting from the remeasurement of the bolivar denominated monetary assets and liabilities are recorded in earnings. From February 2013 through July 4, 2015, the Company used the CENCOEX, official rate, which was 6.3 bolivars to the U.S. dollar, to remeasure its Venezuelan subsidiary’s financial statements to U.S. dollars. The CENCOEX official rate was restricted toward goods and services for industry sectors considered essential, which are primarily food, medicines and a few others. In February 2015, the Venezuelan government announced the addition of a new foreign currency exchange system referred to as the Marginal Currency System, or SIMADI. During 2015, the Company experienced an increase in the amount of time it takes to exchange bolivars for U.S. dollars through the CENCOEX exchange. Due to this reduced availability of U.S. dollars and upon review of U.S. dollar cash needs in the Company's Venezuela operations as of the quarter ended July 4, 2015, the Company concluded that it was no longer able to obtain sufficient U.S. dollars on a timely basis through the CENCOEX exchange resulting in a decision to remeasure our Venezuela subsidiary's financial statements using the SIMADI rate. In connection with the change in rates, the Company evaluated the carrying value of its non-monetary assets for impairment and lower of cost or market adjustments. As a result of moving from the CENCOEX official rate to the SIMADI rate, the Company recorded pre-tax charges totaling $152 million in the quarter ended July 4, 2015. Of the total charges, $100 million was recorded in COGS, $3 million was recorded in SGA, and $49 million was recorded in Other income (expense), net. These charges consist of $47 million related to the remeasurement of net monetary assets denominated in Venezuelan bolivar at the SIMADI exchange rate (recorded in Other income (expense), net), $56 million related to reducing inventory to the lower of cost or market (recorded in COGS) and $49 million related to the impairment of long-lived assets in Venezuela (recorded primarily in COGS). In February 2016, the Venezuelan government announced changes to its foreign currency exchange mechanisms, including a 59% devaluation of the CENCOEX (now named DIPRO) official rate from 6.3 bolivars to 10.0 bolivars to the U.S. dollar. Additionally the SIMADI exchange rate was replaced by the DICOM exchange rate, a new floating exchange rate for non-essential imports. The DICOM exchange rate was introduced at 206 bolivars to the U.S. dollar and the Venezuelan government has reported that the DICOM exchange rate will be allowed to float to meet market needs. The Company has evaluated all of the facts and circumstances surrounding its Venezuelan business and determined that as of July 2, 2016, the DICOM (formerly SIMADI) rate continues to be the appropriate rate to use for remeasuring its Venezuelan subsidiary’s financial statements. As of July 2, 2016, the published DIPRO and DICOM rates offered were 10.0 and 632.9 bolivars to the U.S. dollar, respectively. For the year-to-date periods ended July 2, 2016 and July 4, 2015, Venezuela represented less than 1% and approximately 3% of total net sales, respectively. The Company’s net monetary assets denominated in the Venezuelan bolivar were immaterial after applying the DICOM and SIMADI exchange rates as of July 2, 2016 and January 2, 2016, respectively. The Company continues to monitor and actively manage its investment and exposure in Venezuela. The Company’s Venezuelan business does not rely heavily on imports and when items are imported, they are largely exchanged at the DIPRO official rate; however, the Company considers it reasonably possible to utilize alternate exchange mechanisms in the future. The Company is continuing to take actions to further reduce its reliance on imports in order to run its operations without the need for U.S. dollars, including the elimination of imported ingredients where possible and developing a local supply for parts and materials. Less than 2% of the total raw material needs of the Company's Venezuela operations are imported. The Company will continue to monitor local conditions and its ability to obtain U.S. dollars through the various exchange mechanisms available to determine the appropriate rate for remeasurement. |
Reportable Segments |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reportable Segments | Reportable segments Kellogg Company is the world’s leading producer of cereal, second largest producer of cookies and crackers, and a leading producer of savory snacks and frozen foods. Additional product offerings include toaster pastries, cereal bars, fruit-flavored snacks and veggie foods. Kellogg products are manufactured and marketed globally. Principal markets for these products include the United States and United Kingdom. The Company manages its operations through nine operating segments that are based on product category or geographic location. These operating segments are evaluated for similarity with regards to economic characteristics, products, production processes, types or classes of customers, distribution methods and regulatory environments to determine if they can be aggregated into reportable segments. The reportable segments are discussed in greater detail below. The U.S. Morning Foods operating segment includes cereal, toaster pastries, and health and wellness beverages and bars. U.S. Snacks includes cookies, crackers, cereal bars, savory snacks and fruit-flavored snacks. U.S. Specialty primarily represents food away from home channels, including food service, convenience, vending, Girl Scouts and food manufacturing. The food service business is mostly non-commercial, serving institutions such as schools and hospitals. The convenience business includes traditional convenience stores as well as alternate retail outlets. North America Other includes the U.S. Frozen, Kashi and Canada operating segments. As these operating segments are not considered economically similar enough to aggregate with other operating segments and are immaterial for separate disclosure, they have been grouped together as a single reportable segment. The three remaining reportable segments are based on geographic location – Europe which consists principally of European countries; Latin America which consists of Central and South America and includes Mexico; and Asia Pacific which consists of Sub-Saharan Africa, Australia and other Asian and Pacific markets. The measurement of reportable segment results is based on segment operating profit which is generally consistent with the presentation of operating profit in the Consolidated Statement of Income. Intercompany transactions between operating segments were insignificant in all periods presented.
|
Subsequent Events |
6 Months Ended |
---|---|
Jul. 02, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | Subsequent events On July 13, 2016, we entered into a $200 million U.S. accounts receivable securitization program with a third party financial institution. Under this program, we will receive cash consideration of up to $200 million and an other receivable for the remainder of the purchase price. We will account for transfers of receivables pursuant to this program as a sale and remove them from our consolidated balance sheet. This securitization program utilizes Kellogg Funding Company (Kellogg Funding), a wholly-owned subsidiary of the Company. Kellogg Funding's sole business consists of the purchase of receivables and related assets, from its parent or other subsidiary and subsequent transfer of such receivables and related assets to the financial institution. Although Kellogg Funding is included in our consolidated financial statements, it is a separate legal entity with separate creditors who will be entitled, upon its liquidation, to be satisfied out of Kellogg Funding assets prior to any assets or value in Kellogg Funding becoming available to the Company or its subsidiaries. The assets of Kellogg Funding are not available to pay creditors of the Company or its subsidiaries. This program expires in July 2017. |
Accounting Policies (Policies) |
6 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||
Accounting Policies [Abstract] | |||||||||||||
Basis of presentation | The unaudited interim financial information of Kellogg Company (the Company) included in this report reflects all adjustments, all of which are of a normal and recurring nature, that management believes are necessary for a fair statement of the results of operations, comprehensive income, financial position, equity and cash flows for the periods presented. This interim information should be read in conjunction with the financial statements and accompanying footnotes within the Company’s 2015 Annual Report on Form 10-K. The condensed balance sheet information at January 2, 2016 was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States. The results of operations for the quarterly period ended July 2, 2016 are not necessarily indicative of the results to be expected for other interim periods or the full year. |
||||||||||||
Accounts payable | The Company has an agreement with a third party to provide an accounts payable tracking system which facilitates participating suppliers’ ability to monitor and, if elected, sell payment obligations from the Company to designated third-party financial institutions. Participating suppliers may, at their sole discretion, make offers to sell one or more payment obligations of the Company prior to their scheduled due dates at a discounted price to participating financial institutions. The Company’s goal in entering into this agreement is to capture overall supplier savings, in the form of payment terms or vendor funding, created by facilitating suppliers’ ability to sell payment obligations, while providing them with greater working capital flexibility. We have no economic interest in the sale of these suppliers’ receivables and no direct financial relationship with the financial institutions concerning these services. The Company’s obligations to its suppliers, including amounts due and scheduled payment dates, are not impacted by suppliers’ decisions to sell amounts under this arrangement. However, the Company’s right to offset balances due from suppliers against payment obligations is restricted by this agreement for those payment obligations that have been sold by suppliers. |
||||||||||||
New accounting standards and accounting standards to be adopted in future period | Improvements to employee share-based payment accounting. In March 2016, the Financial Accounting Standards Board (FASB) issued an Accounting Standards Update (ASU) as part of its simplification initiative. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. Early adoption is permitted. The Company early adopted the accounting standard update in the first quarter of 2016. The ASU includes multiple provisions intended to simplify various aspects of the accounting for share-based payments. The main provisions of the ASU are as follows:
Balance sheet classification of deferred taxes. In November 2015, the FASB issued an ASU to simplify the presentation of deferred income taxes. The ASU requires that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. Entities should apply the new guidance either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. Early adoption is permitted. The Company early adopted the updated standard in the first quarter of 2016, on a prospective basis. The year-end 2015 balances for current deferred tax assets and current deferred liabilities was $227 million and $9 million, respectively. Prior period balances have not been adjusted. Simplifying the presentation of debt issuance costs. In April 2015, the FASB issued an ASU to simplify the presentation of debt issuance costs. The ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Early adoption was permitted. Entities should apply the new guidance on a retrospective basis. The Company adopted the updated standard in the first quarter of 2016 with no significant impact on its financial statements. Simplifying the accounting for measurement-period adjustments. In September 2015, the FASB issued an ASU to simplify the accounting for measurement-period adjustments for items in a business combination. The ASU requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Entities should apply the new guidance prospectively to adjustments to provisional amounts that occur after the effective date of the ASU with earlier application permitted for financial statements that have not been issued. The Company adopted the updated standard in the first quarter of 2016 with no significant impact on its financial statements. Customer's accounting for fees paid in a cloud computing arrangement. In April 2015, the FASB issued an ASU to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted. Entities should apply the new guidance either; 1) prospectively to all arrangements entered into or materially modified after the effective date or 2) retrospectively. The Company adopted the updated standard prospectively in the first quarter of 2016 with no significant impact on its financial statements. Accounting standards to be adopted in future periods Leases. In February 2016, the FASB issued an ASU which will require the recognition of lease assets and lease liabilities by lessees for all leases with terms greater than 12 months. The distinction between finance leases and operating leases will remain, with similar classification criteria as current GAAP to distinguish between capital and operating leases. The principal difference from current guidance is that the lease assets and lease liabilities arising from operating leases will be recognized on the Consolidated Balance Sheet. Lessor accounting remains substantially similar to current GAAP. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. Early adoption is permitted. The Company is currently evaluating the impact that implementing this ASU will have on its financial statements and disclosures, as well as timing of implementation. Recognition and measurement of financial assets and liabilities. In January 2016, the FASB issued an ASU which primarily affects the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption can be elected for all financial statements of fiscal years and interim periods that have not yet been issued or that have not yet been made available for issuance. Entities should apply the update by means of a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. The Company will adopt the updated standard in the first quarter of 2018. The Company does not expect the adoption of this guidance to have a significant impact on its financial statements. Revenue from contracts with customers. In May 2014, the FASB issued an ASU which provides guidance for accounting for revenue from contracts with customers. The core principle of this ASU is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration the entity expects to be entitled to in exchange for those goods or services. To achieve that core principle, an entity would be required to apply the following five steps: 1) identify the contract(s) with a customer; 2) identify the performance obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to the performance obligations in the contract and 5) recognize revenue when (or as) the entity satisfies a performance obligation. When the ASU was originally issued it was effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, and early adoption was not permitted. On July 9, 2015, the FASB decided to delay the effective date of the new revenue standard by one year. The updated standard will be effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Entities will be permitted to adopt the new revenue standard early, but not before the original effective date. Entities will have the option to apply the final standard retrospectively or use a modified retrospective method, recognizing the cumulative effect of the ASU in retained earnings at the date of initial application. An entity will not restate prior periods if it uses the modified retrospective method, but will be required to disclose the amount by which each financial statement line item is affected in the current reporting period by the application of the ASU as compared to the guidance in effect prior to the change, as well as reasons for significant changes. The Company will adopt the updated standard in the first quarter of 2018. The Company is currently evaluating the impact that implementing this ASU will have on its financial statements and disclosures, as well as whether it will use the retrospective or modified retrospective method of adoption. |
Goodwill and Other Intangible Assets (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisitions, Goodwill and Other Intangible Assets [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Carrying Amount of Goodwill | Carrying amount of goodwill
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets Subject to Amortization | Intangible assets subject to amortization (millions)
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets Not Subject to Amortization | Intangible assets not subject to amortization
|
Restructuring and Cost Reduction Activities (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring and Cost Reduction Activities | The tables below provide the details for charges across all restructuring and cost reduction activities incurred during the quarter and year-to-date periods ended July 2, 2016 and July 4, 2015 and program costs to date for programs currently active as of July 2, 2016.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Exit Cost Reserves | The following table provides details for exit cost reserves.
|
Equity (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share | Quarters ended July 2, 2016 and July 4, 2015:
Year-to-date periods ended July 2, 2016 and July 4, 2015:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reclassifications Out of AOCI | Reclassifications out of Accumulated Other Comprehensive Income (AOCI) for the quarter and year-to-date periods ended July 2, 2016 consisted of the following:
Reclassifications out of Accumulated Other Comprehensive Income (AOCI) for the quarter and year-to-date periods ended July 4, 2015 consisted of the following:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Accumulated Other Comprehensive Income (Loss) | Accumulated other comprehensive income (loss) as of July 2, 2016 and January 2, 2016 consisted of the following:
|
Debt (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Notes Payable | The following table presents the components of notes payable at July 2, 2016 and January 2, 2016:
(a) Negative effective interest rates on certain borrowings in Europe are the result of efforts by the European Central Bank to stimulate the economy in the eurozone. |
Stock Compensation (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Compensation Expense for Equity-Based Programs and Related Income Tax Benefits | For the periods presented, compensation expense for all types of equity-based programs and the related income tax benefit recognized was as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Stock Option Activity | Year-to-date period ended July 2, 2016:
Year-to-date period ended July 4, 2015:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value Assumptions | The fair value was estimated using the following assumptions:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Maximum Future Value of Performance Shares | Based on the market price of the Company’s common stock at July 2, 2016, the maximum future value that could be awarded to employees on the vesting date for all outstanding performance share awards was as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restricted Stock Activity | Year-to-date period ended July 2, 2016:
Year-to-date period ended July 4, 2015:
|
Employee Benefits (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Compensation and Retirement Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Plan Benefit Expense | Pension
Other nonpension postretirement
Postemployment
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contributions to Employee Benefit Plans | Company contributions to employee benefit plans are summarized as follows:
|
Income Taxes (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of Total Gross Unrecognized Tax Benefits | Following is a reconciliation of the Company’s total gross unrecognized tax benefits for the year-to-date period ended July 2, 2016; $50 million of this total represents the amount that, if recognized, would affect the Company’s effective income tax rate in future periods.
|
Derivative Instruments and Fair Value Measurements (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Fair Value Measurements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Total Notional Amounts of Derivative Instruments | Total notional amounts of the Company’s derivative instruments as of July 2, 2016 and January 2, 2016 were as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheet on a recurring basis as of July 2, 2016 and January 2, 2016: Derivatives designated as hedging instruments
(a) The fair value of the related hedged portion of the Company's long-term debt, a level 2 liability, was $668 million as of July 2, 2016. Derivatives not designated as hedging instruments
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Offsetting Assets | The Company has elected not to offset the fair values of derivative assets and liabilities executed with the same counterparty that are generally subject to enforceable netting agreements. However, if the Company were to offset and record the asset and liability balances of derivatives on a net basis, the amounts presented in the Consolidated Balance Sheet as of July 2, 2016 and January 2, 2016 would be adjusted as detailed in the following table:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Offsetting Liabilities | The Company has elected not to offset the fair values of derivative assets and liabilities executed with the same counterparty that are generally subject to enforceable netting agreements. However, if the Company were to offset and record the asset and liability balances of derivatives on a net basis, the amounts presented in the Consolidated Balance Sheet as of July 2, 2016 and January 2, 2016 would be adjusted as detailed in the following table:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of the Effect of Derivative Instruments on the Consolidated Statements of Income and Comprehensive Income | The effect of derivative instruments on the Consolidated Statements of Income and Comprehensive Income for the quarters ended July 2, 2016 and July 4, 2015 was as follows: Derivatives in fair value hedging relationships
Derivatives in cash flow hedging relationships
Derivatives and non-derivatives in net investment hedging relationships
Derivatives not designated as hedging instruments
The effect of derivative instruments on the Consolidated Statements of Income and Comprehensive Income for the year-to-date periods ended July 2, 2016 and July 4, 2015 was as follows: Derivatives in fair value hedging relationships
(a) Includes the ineffective portion and amount excluded from effectiveness testing. Derivatives in cash flow hedging relationships
(a) Includes the ineffective portion and amount excluded from effectiveness testing. Derivatives and non-derivatives in net investment hedging relationships
Derivatives not designated as hedging instruments
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets Measured at Fair Value on a Nonrecurring Basis |
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value of Long-term Debt | The fair value of the Company’s long-term debt, which are level 2 liabilities, is calculated based on broker quotes and was as follows at July 2, 2016:
|
Reportable Segments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Reportable Segment Information |
|
Accounting Policies - Narrative (Details) - USD ($) $ in Millions |
Jul. 02, 2016 |
Jan. 02, 2016 |
---|---|---|
Accounting Policies [Abstract] | ||
Deferred Tax Assets, Net, Current | $ 227 | |
Deferred Tax Liabilities, Net | 9 | |
Obligations placed in accounts payable tracking system | $ 622 | 501 |
Obligations sold by participating suppliers | $ 475 | $ 407 |
Sale of Accounts Receivable - Narrative (Details) - Receivables Sales Agreement - USD ($) $ in Millions |
Jul. 02, 2016 |
Apr. 02, 2016 |
---|---|---|
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable sold | $ 529 | |
Receivable sold and outstanding | 517 | |
Increase To Maximum Receivables | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Financing receivable | $ 350 | |
Maximum | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Financing receivable | $ 550 |
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Millions |
1 Months Ended | 6 Months Ended | |
---|---|---|---|
Mar. 31, 2016 |
Jul. 02, 2016 |
Jul. 04, 2015 |
|
Equity Method Investments and Joint Ventures [Line Items] | |||
Contribution to joint venture | $ (5) | ||
Finite-Lived Intangible Assets, Future Amortization Expense [Abstract] | |||
Amortization | 4 | $ 4 | |
Estimated annual amortization expense in year one | 7 | ||
Tolaram | |||
Equity Method Investments and Joint Ventures [Line Items] | |||
Contribution to joint venture | $ (5) | ||
North America Other | |||
Business Acquisition [Line Items] | |||
Payments to acquire business | $ 18 |
Goodwill and Other Intangible Assets - Carrying Amount of Goodwill (Details) $ in Millions |
6 Months Ended | |||
---|---|---|---|---|
Jul. 02, 2016
USD ($)
| ||||
Change in carrying amount of goodwill | ||||
Beginning Balance | $ 4,968 | [1] | ||
Currency translation adjustment | (5) | |||
Ending Balance | 4,963 | |||
U.S. Morning Foods | ||||
Change in carrying amount of goodwill | ||||
Beginning Balance | 131 | |||
Currency translation adjustment | 0 | |||
Ending Balance | 131 | |||
U.S. Snacks | ||||
Change in carrying amount of goodwill | ||||
Beginning Balance | 3,568 | |||
Currency translation adjustment | 0 | |||
Ending Balance | 3,568 | |||
U.S. Specialty | ||||
Change in carrying amount of goodwill | ||||
Beginning Balance | 82 | |||
Currency translation adjustment | 0 | |||
Ending Balance | 82 | |||
North America Other | ||||
Change in carrying amount of goodwill | ||||
Beginning Balance | 456 | |||
Currency translation adjustment | 3 | |||
Ending Balance | 459 | |||
Europe | ||||
Change in carrying amount of goodwill | ||||
Beginning Balance | 431 | |||
Currency translation adjustment | (8) | |||
Ending Balance | 423 | |||
Latin America | ||||
Change in carrying amount of goodwill | ||||
Beginning Balance | 76 | |||
Currency translation adjustment | (1) | |||
Ending Balance | 75 | |||
Asia Pacific | ||||
Change in carrying amount of goodwill | ||||
Beginning Balance | 224 | |||
Currency translation adjustment | 1 | |||
Ending Balance | $ 225 | |||
|
Goodwill and Other Intangible Assets - Intangible Assets Subject to Amortization (Details) - USD ($) $ in Millions |
6 Months Ended | |||
---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
|||
Finite-lived Intangible Assets [Roll Forward] | ||||
Gross carrying amount, beginning balance | $ 116 | |||
Currency translation adjustment | 0 | |||
Gross carrying amount, ending balance | 116 | |||
Accumulated amortization, beginning balance | [1] | 47 | ||
Amortization | 4 | $ 4 | ||
Accumulated amortization, ending balance | 51 | |||
Intangible assets subject to amortization net, beginning balance | 69 | |||
Currency translation adjustment | 0 | |||
Amortization | (4) | $ (4) | ||
Intangible assets subject to amortization net, ending balance | 65 | |||
U.S. Morning Foods | ||||
Finite-lived Intangible Assets [Roll Forward] | ||||
Gross carrying amount, beginning balance | 8 | |||
Currency translation adjustment | 0 | |||
Gross carrying amount, ending balance | 8 | |||
Accumulated amortization, beginning balance | 8 | |||
Amortization | 0 | |||
Accumulated amortization, ending balance | 8 | |||
Intangible assets subject to amortization net, beginning balance | 0 | |||
Currency translation adjustment | 0 | |||
Amortization | 0 | |||
Intangible assets subject to amortization net, ending balance | 0 | |||
U.S. Snacks | ||||
Finite-lived Intangible Assets [Roll Forward] | ||||
Gross carrying amount, beginning balance | 42 | |||
Currency translation adjustment | 0 | |||
Gross carrying amount, ending balance | 42 | |||
Accumulated amortization, beginning balance | 16 | |||
Amortization | 2 | |||
Accumulated amortization, ending balance | 18 | |||
Intangible assets subject to amortization net, beginning balance | 26 | |||
Currency translation adjustment | 0 | |||
Amortization | (2) | |||
Intangible assets subject to amortization net, ending balance | 24 | |||
U.S. Specialty | ||||
Finite-lived Intangible Assets [Roll Forward] | ||||
Gross carrying amount, beginning balance | 0 | |||
Currency translation adjustment | 0 | |||
Gross carrying amount, ending balance | 0 | |||
Accumulated amortization, beginning balance | 0 | |||
Amortization | 0 | |||
Accumulated amortization, ending balance | 0 | |||
Intangible assets subject to amortization net, beginning balance | 0 | |||
Currency translation adjustment | 0 | |||
Amortization | 0 | |||
Intangible assets subject to amortization net, ending balance | 0 | |||
North America Other | ||||
Finite-lived Intangible Assets [Roll Forward] | ||||
Gross carrying amount, beginning balance | 5 | |||
Currency translation adjustment | 0 | |||
Gross carrying amount, ending balance | 5 | |||
Accumulated amortization, beginning balance | 4 | |||
Amortization | 0 | |||
Accumulated amortization, ending balance | 4 | |||
Intangible assets subject to amortization net, beginning balance | 1 | |||
Currency translation adjustment | 0 | |||
Amortization | 0 | |||
Intangible assets subject to amortization net, ending balance | 1 | |||
Europe | ||||
Finite-lived Intangible Assets [Roll Forward] | ||||
Gross carrying amount, beginning balance | 45 | |||
Currency translation adjustment | 0 | |||
Gross carrying amount, ending balance | 45 | |||
Accumulated amortization, beginning balance | 11 | |||
Amortization | 2 | |||
Accumulated amortization, ending balance | 13 | |||
Intangible assets subject to amortization net, beginning balance | 34 | |||
Currency translation adjustment | 0 | |||
Amortization | (2) | |||
Intangible assets subject to amortization net, ending balance | 32 | |||
Latin America | ||||
Finite-lived Intangible Assets [Roll Forward] | ||||
Gross carrying amount, beginning balance | 6 | |||
Currency translation adjustment | 0 | |||
Gross carrying amount, ending balance | 6 | |||
Accumulated amortization, beginning balance | 6 | |||
Amortization | 0 | |||
Accumulated amortization, ending balance | 6 | |||
Intangible assets subject to amortization net, beginning balance | 0 | |||
Currency translation adjustment | 0 | |||
Amortization | 0 | |||
Intangible assets subject to amortization net, ending balance | 0 | |||
Asia Pacific | ||||
Finite-lived Intangible Assets [Roll Forward] | ||||
Gross carrying amount, beginning balance | 10 | |||
Currency translation adjustment | 0 | |||
Gross carrying amount, ending balance | 10 | |||
Accumulated amortization, beginning balance | 2 | |||
Amortization | 0 | |||
Accumulated amortization, ending balance | 2 | |||
Intangible assets subject to amortization net, beginning balance | 8 | |||
Currency translation adjustment | 0 | |||
Amortization | 0 | |||
Intangible assets subject to amortization net, ending balance | $ 8 | |||
|
Goodwill and Other Intangible Assets - Intangible Assets Not Subject to Amortization (Details) $ in Millions |
6 Months Ended |
---|---|
Jul. 02, 2016
USD ($)
| |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | $ 2,199 |
Additions | 18 |
Contribution to joint venture | (5) |
Currency translation adjustment | 5 |
Intangible assets not subject to amortization, ending balance | 2,217 |
U.S. Morning Foods | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | 0 |
Additions | 0 |
Contribution to joint venture | 0 |
Currency translation adjustment | 0 |
Intangible assets not subject to amortization, ending balance | 0 |
U.S. Snacks | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | 1,625 |
Additions | 0 |
Contribution to joint venture | 0 |
Currency translation adjustment | 0 |
Intangible assets not subject to amortization, ending balance | 1,625 |
U.S. Specialty | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | 0 |
Additions | 0 |
Contribution to joint venture | 0 |
Currency translation adjustment | 0 |
Intangible assets not subject to amortization, ending balance | 0 |
North America Other | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | 158 |
Additions | 18 |
Contribution to joint venture | 0 |
Currency translation adjustment | 1 |
Intangible assets not subject to amortization, ending balance | 177 |
Europe | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | 416 |
Additions | 0 |
Contribution to joint venture | (5) |
Currency translation adjustment | 4 |
Intangible assets not subject to amortization, ending balance | 415 |
Latin America | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | 0 |
Additions | 0 |
Contribution to joint venture | 0 |
Currency translation adjustment | 0 |
Intangible assets not subject to amortization, ending balance | 0 |
Asia Pacific | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | 0 |
Additions | 0 |
Contribution to joint venture | 0 |
Currency translation adjustment | 0 |
Intangible assets not subject to amortization, ending balance | 0 |
Tolaram | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Contribution to joint venture | $ (5) |
Investment in Unconsolidated Entities - Narrative (Details) - USD ($) $ in Millions |
1 Months Ended | 3 Months Ended | 6 Months Ended |
---|---|---|---|
Sep. 30, 2015 |
Jul. 02, 2016 |
Jul. 02, 2016 |
|
Schedule of Equity Method Investments [Line Items] | |||
Adjustment to investment in unconsolidated entities | $ 5 | ||
Multipro [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Payments to Acquire Interest in Joint Venture | $ 445 | ||
Equity method investment, ownership percentage | 50.00% | ||
Adjustment to investment in unconsolidated entities | $ (28) | ||
Time period to exercise purchase option | 1 year | ||
Multipro [Member] | Purchase option [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investment, ownership percentage | 24.50% |
Restructuring and Cost Reduction Activities - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
Jan. 02, 2016 |
|
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring plan, number of years | 5 years | ||||
Restructuring and related costs since inception of program | $ 953 | $ 953 | |||
Restructuring charges | 72 | $ 90 | 124 | $ 158 | |
Exit cost reserves | 70 | 70 | $ 88 | ||
Revenue | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | 2 | ||||
Cost of Goods Sold | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | 36 | 65 | 54 | 97 | |
Selling General and Administrative Expenses | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | 36 | 25 | 70 | 59 | |
Employee related costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs since inception of program | 279 | 279 | |||
Restructuring charges | 6 | 16 | 20 | 33 | |
Exit cost reserves | 40 | 40 | 55 | ||
Asset related costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs since inception of program | 173 | 173 | |||
Restructuring charges | 17 | 24 | 27 | 47 | |
Exit cost reserves | 0 | 0 | 0 | ||
Asset impairment | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs since inception of program | 121 | 121 | |||
Restructuring charges | 16 | 18 | 16 | 18 | |
Exit cost reserves | 0 | 0 | 0 | ||
Other costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs since inception of program | 380 | 380 | |||
Restructuring charges | 33 | 32 | 61 | 60 | |
Exit cost reserves | 30 | $ 30 | $ 33 | ||
Project K | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring plan, number of years | 4 years | ||||
Restructuring and related costs since inception of program | 924 | $ 924 | |||
Project K | Revenue | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs since inception of program | 6 | 6 | |||
Project K | Cost of Goods Sold | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs since inception of program | 571 | 571 | |||
Project K | Selling General and Administrative Expenses | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs since inception of program | 347 | 347 | |||
Project K | Minimum | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs, expected cost | 1,200 | 1,200 | |||
Estimated after-tax cash costs for program, including incremental capital investments | 900 | ||||
Project K | Maximum | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs, expected cost | 1,400 | 1,400 | |||
Estimated after-tax cash costs for program, including incremental capital investments | $ 1,100 | ||||
Project K | U.S. Morning Foods | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, expected cost allocation | 18.00% | ||||
Project K | U.S. Snacks | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, expected cost allocation | 17.00% | ||||
Project K | U.S. Specialty | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, expected cost allocation | 1.00% | ||||
Project K | North America Other | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, expected cost allocation | 10.00% | ||||
Project K | Europe | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, expected cost allocation | 17.00% | ||||
Project K | Latin America | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, expected cost allocation | 2.00% | ||||
Project K | Asia Pacific | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, expected cost allocation | 6.00% | ||||
Project K | Employee related costs | Minimum | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs, expected cost | 400 | $ 400 | |||
Project K | Employee related costs | Maximum | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs, expected cost | 450 | 450 | |||
Project K | Asset related costs | Minimum | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs, expected cost | 400 | 400 | |||
Project K | Asset related costs | Maximum | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs, expected cost | 450 | 450 | |||
Project K | Other costs | Minimum | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs, expected cost | 400 | 400 | |||
Project K | Other costs | Maximum | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs, expected cost | 500 | 500 | |||
Zero Based Budgeting | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs since inception of program | 29 | 29 | |||
Restructuring Charges | 12 | 17 | |||
Corporate | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related costs since inception of program | 130 | 130 | |||
Restructuring charges | $ 7 | $ 14 | $ 9 | $ 34 | |
Corporate | Project K | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, expected cost allocation | 29.00% |
Restructuring and Cost Reduction Activities - Schedule of Restructuring and Cost Reduction Activities (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
|
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 72 | $ 90 | $ 124 | $ 158 |
Program costs to date | 953 | 953 | ||
Employee related costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 6 | 16 | 20 | 33 |
Program costs to date | 279 | 279 | ||
Asset impairment | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 16 | 18 | 16 | 18 |
Program costs to date | 121 | 121 | ||
Asset related costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 17 | 24 | 27 | 47 |
Program costs to date | 173 | 173 | ||
Other costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 33 | 32 | 61 | 60 |
Program costs to date | 380 | 380 | ||
Operating Segments | U.S. Morning Foods | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 4 | 13 | 9 | 21 |
Program costs to date | 227 | 227 | ||
Operating Segments | U.S. Snacks | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 34 | 10 | 54 | 19 |
Program costs to date | 180 | 180 | ||
Operating Segments | U.S. Specialty | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 1 | 1 | 3 | 2 |
Program costs to date | 14 | 14 | ||
Operating Segments | North America Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 4 | 23 | 13 | 29 |
Program costs to date | 103 | 103 | ||
Operating Segments | Europe | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 14 | 25 | 28 | 44 |
Program costs to date | 201 | 201 | ||
Operating Segments | Latin America | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 4 | 1 | 4 | 1 |
Program costs to date | 20 | 20 | ||
Operating Segments | Asia Pacific | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 4 | 3 | 4 | 8 |
Program costs to date | 78 | 78 | ||
Corporate | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 7 | $ 14 | 9 | $ 34 |
Program costs to date | $ 130 | $ 130 |
Restructuring and Cost Reduction Activities - Restructuring and Cost Reduction Reserves Rollforward (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
|
Restructuring Reserve [Roll Forward] | ||||
Liability, beginning balance | $ 88 | |||
Restructuring charges | $ 72 | $ 90 | 124 | $ 158 |
Cash payments | (110) | |||
Non-cash charges and other | (32) | |||
Liability, ending balance | 70 | 70 | ||
Employee related costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Liability, beginning balance | 55 | |||
Restructuring charges | 6 | 16 | 20 | 33 |
Cash payments | (35) | |||
Non-cash charges and other | 0 | |||
Liability, ending balance | 40 | 40 | ||
Asset impairment | ||||
Restructuring Reserve [Roll Forward] | ||||
Liability, beginning balance | 0 | |||
Restructuring charges | 16 | 18 | 16 | 18 |
Cash payments | 0 | |||
Non-cash charges and other | (16) | |||
Liability, ending balance | 0 | 0 | ||
Asset related costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Liability, beginning balance | 0 | |||
Restructuring charges | 17 | 24 | 27 | 47 |
Cash payments | (11) | |||
Non-cash charges and other | (16) | |||
Liability, ending balance | 0 | 0 | ||
Other costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Liability, beginning balance | 33 | |||
Restructuring charges | 33 | $ 32 | 61 | $ 60 |
Cash payments | (64) | |||
Non-cash charges and other | 0 | |||
Liability, ending balance | $ 30 | $ 30 |
Equity - Narrative (Details) - USD ($) shares in Millions, $ in Millions |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
---|---|---|---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
Jan. 02, 2016 |
Dec. 31, 2015 |
Feb. 28, 2014 |
|
Equity, Class of Treasury Stock [Line Items] | |||||||
Anti-dilutive potential common shares excluded from reconciliation | 3 | 3 | 2 | 2 | |||
Common stock repurchased (in shares) | 5 | 4 | |||||
Common stock repurchased | $ 386 | $ 285 | $ 731 | ||||
Treasury stock | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Common stock repurchased (in shares) | 5 | 11 | |||||
Common stock repurchased | $ 386 | $ 731 | |||||
February 2014 Share Repurchase Program | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Stock repurchase program, authorized amount | $ 1,500 | ||||||
December 2015 Share Repurchase Program | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Stock repurchase program, authorized amount | $ 1,500 |
Equity - Schedule of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
|
Equity [Abstract] | ||||
Net income attributable to Kellogg Company, Basic | $ 280 | $ 223 | $ 455 | $ 450 |
Average shares outstanding, Basic (in shares) | 350 | 353 | 350 | 354 |
Earnings per share, Basic (in dollars per share) | $ 0.80 | $ 0.63 | $ 1.30 | $ 1.27 |
Average shares outstanding, Dilutive potential common shares (in shares) | 4 | 2 | 4 | 2 |
Earnings per share, Dilutive potential common shares (in dollars per share) | $ (0.01) | $ 0.00 | $ (0.01) | $ (0.01) |
Net income attributable to Kellogg Company, Diluted | $ 280 | $ 223 | $ 455 | $ 450 |
Average shares outstanding, Diluted (in shares) | 354 | 355 | 354 | 356 |
Earnings per share, Diluted (in dollars per share) | $ 0.79 | $ 0.63 | $ 1.29 | $ 1.26 |
Equity - Reclassifications Out of AOCI (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
Jan. 02, 2016 |
|
Derivative Instruments, Gain (Loss) [Line Items] | |||||
COGS | $ 1,998 | $ 2,257 | $ 4,148 | $ 4,568 | |
SGA | (821) | (829) | (1,628) | (1,690) | |
Interest expense | 68 | 58 | 285 | 112 | |
Net experience loss | (1) | (1) | (2) | (2) | |
Prior service cost | 2 | 2 | 2 | 5 | |
Total before tax | 385 | 308 | 606 | 612 | |
Tax (expense) benefit | (106) | (85) | (153) | (161) | |
Net income | 280 | 222 | 455 | 449 | $ 614 |
Reclassification out of Accumulated Other Comprehensive Income | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Net income | 7 | (1) | 9 | (2) | |
Reclassification out of Accumulated Other Comprehensive Income | (Gains) losses on cash flow hedges | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Total before tax | 6 | (3) | 8 | (7) | |
Tax (expense) benefit | (2) | 0 | (3) | 0 | |
Net income | 4 | (3) | 5 | (7) | |
Reclassification out of Accumulated Other Comprehensive Income | (Gains) losses on cash flow hedges | Foreign currency exchange contracts | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
COGS | 0 | (9) | (7) | (16) | |
SGA | 0 | 2 | 0 | 2 | |
Reclassification out of Accumulated Other Comprehensive Income | (Gains) losses on cash flow hedges | Interest rate contracts | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Interest expense | 2 | 1 | 8 | 1 | |
Reclassification out of Accumulated Other Comprehensive Income | (Gains) losses on cash flow hedges | Commodity contracts | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
COGS | 4 | 3 | 7 | 6 | |
Reclassification out of Accumulated Other Comprehensive Income | Amortization of postretirement and postemployment benefits | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Net experience loss | 1 | 1 | 2 | 2 | |
Prior service cost | 2 | 2 | 2 | 5 | |
Total before tax | 3 | 3 | 4 | 7 | |
Tax (expense) benefit | 0 | (1) | 0 | (2) | |
Net income | $ 3 | $ 2 | $ 4 | $ 5 |
Equity - Summary of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions |
Jul. 02, 2016 |
Jan. 02, 2016 |
|||
---|---|---|---|---|---|
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||
Foreign currency translation adjustments | $ (1,404) | $ (1,314) | |||
Cash flow hedges — unrealized net gain (loss) | (70) | (39) | |||
Postretirement and postemployment benefits: | |||||
Net experience loss | (14) | (16) | |||
Prior service cost | (6) | (7) | |||
Total accumulated other comprehensive income (loss) | $ (1,494) | $ (1,376) | [1] | ||
|
Equity - Noncontrolling Interests (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jul. 04, 2015 |
Apr. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
Dec. 31, 2012 |
|
Noncontrolling Interest [Line Items] | |||||
Non-cash gain from deconsolidation | $ 0 | $ 49 | |||
Variable Interest Entity Primary Beneficiary | |||||
Noncontrolling Interest [Line Items] | |||||
Convertible debt | $ 44 | ||||
Percentage of debt convertible into equity | 85.00% | ||||
Other Income (Expense), Net | Variable Interest Entity Primary Beneficiary | |||||
Noncontrolling Interest [Line Items] | |||||
Non-cash charge (reversal) | $ 6 | $ 25 | $ 19 | ||
U.S. Snacks | Selling General and Administrative Expenses | Variable Interest Entity Primary Beneficiary | |||||
Noncontrolling Interest [Line Items] | |||||
Non-cash gain from deconsolidation | $ 67 |
Debt - Components of Notes Payable (Details) - USD ($) $ in Millions |
Jul. 02, 2016 |
Jan. 02, 2016 |
||||||
---|---|---|---|---|---|---|---|---|
Short-term Debt [Line Items] | ||||||||
Principal amount | $ 780 | $ 1,204 | [1] | |||||
U.S. commercial paper | ||||||||
Short-term Debt [Line Items] | ||||||||
Principal amount | $ 425 | $ 899 | ||||||
Effective interest rate (a) | 0.70% | 0.45% | ||||||
Europe commercial paper | ||||||||
Short-term Debt [Line Items] | ||||||||
Principal amount | $ 328 | $ 261 | ||||||
Effective interest rate (a) | (0.09%) | [2] | 0.01% | |||||
Bank borrowings | ||||||||
Short-term Debt [Line Items] | ||||||||
Principal amount | $ 27 | $ 44 | ||||||
|
Debt - Narrative (Details) € in Millions, $ in Millions |
1 Months Ended | 3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|---|
May 31, 2016
USD ($)
|
Mar. 31, 2016
USD ($)
|
Jul. 02, 2016
USD ($)
|
Jul. 02, 2016
USD ($)
|
Jul. 02, 2016
EUR (€)
|
May 31, 2016
EUR (€)
|
Jan. 02, 2016
USD ($)
|
|
Debt Instrument [Line Items] | |||||||
Proceeds from Debt, Net of Issuance Costs | $ 1,382 | ||||||
Notional amounts of interest rate swaps | $ 2,426 | $ 2,426 | $ 1,680 | ||||
Interest Rate Swap [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Notional amounts of interest rate swaps | 958 | 958 | € 600 | ||||
US Dollar Interest Rate Swap [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Deferred Gain (Loss) on Discontinuation of Interest Rate Fair Value Hedge | $ 12 | $ 12 | |||||
7.45% US. Dollar Debentures Due 2031 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument Amount Redeemed | $ 475 | ||||||
Debt instrument, stated interest rate | 7.45% | 7.45% | 7.45% | 7.45% | |||
Interest Expense, Debt | $ 153 | ||||||
3.25% U.S. Dollar Notes Due 2026 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 750 | ||||||
Debt instrument term | 10 years | ||||||
Debt instrument, stated interest rate | 3.25% | ||||||
4.5% U.S. Notes Due 2046 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 650 | ||||||
Debt instrument term | 30 years | ||||||
Debt instrument, stated interest rate | 4.50% | ||||||
4.0% U.S. Dollar Notes Due 2020 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 600 | $ 600 | |||||
Debt instrument term | 10 years | ||||||
Debt instrument, stated interest rate | 4.00% | 4.00% | 4.00% | ||||
3.125% U.S. Dollar Notes Due 2022 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 358 | $ 358 | |||||
Debt instrument, stated interest rate | 3.125% | 3.125% | 3.125% | ||||
4.45% U.S. Dollar Notes Due 2016 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 750 | ||||||
Debt instrument term | 5 years | ||||||
Debt instrument, stated interest rate | 4.45% | 4.45% | |||||
1.00% Euro Notes Due 2024 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 664 | € 600 | |||||
Debt instrument term | 8 years | ||||||
Debt instrument, stated interest rate | 1.00% | 1.00% | |||||
Proceeds from Debt, Net of Issuance Costs | $ 679 | ||||||
Notes Payable, Other Payables | 4.15% U.S. Dollar Notes Due 2019 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument term | 10 years | ||||||
Debt instrument, stated interest rate | 4.15% | 4.15% | 4.15% | ||||
Effective interest rate (a) | 3.55% | 3.55% | 3.55% | ||||
Notes Payable, Other Payables | 4.0% U.S. Dollar Notes Due 2020 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument term | 10 years | ||||||
Debt instrument, stated interest rate | 4.00% | 4.00% | 4.00% | ||||
Effective interest rate (a) | 2.99% | 2.99% | 2.99% | ||||
Notes Payable, Other Payables | 3.125% U.S. Dollar Notes Due 2022 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument term | 10 years | ||||||
Debt instrument, stated interest rate | 3.125% | 3.125% | 3.125% | ||||
Effective interest rate (a) | 2.51% | 2.51% | 2.51% | ||||
Notes Payable, Other Payables | 1.875% U.S. Dollar Notes Due 2016 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument term | 5 years | ||||||
Debt instrument, stated interest rate | 1.875% | 1.875% | 1.875% | ||||
Effective interest rate (a) | 1.91% | 1.91% | 1.91% | ||||
Notes Payable, Other Payables | 1.75% U.S. Dollar Notes Due 2017 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument term | 5 years | ||||||
Debt instrument, stated interest rate | 1.75% | 1.75% | 1.75% | ||||
Effective interest rate (a) | 1.83% | 1.83% | 1.83% | ||||
Notes Payable, Other Payables | 3.25% U.S. Dollar Notes Due 2018 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument term | 7 years | ||||||
Debt instrument, stated interest rate | 3.25% | 3.25% | 3.25% | ||||
Effective interest rate (a) | 2.58% | 2.58% | 2.58% | ||||
Notes Payable, Other Payables | 1.00% Euro Notes Due 2024 | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument term | 8 years | ||||||
Debt instrument, stated interest rate | 1.00% | 1.00% | 1.00% | ||||
Effective interest rate (a) | 0.82% | 0.82% | 0.82% |
Stock Compensation - Compensation Expense (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation cost not yet recognized | $ 115 | $ 115 | ||
Stock-based compensation cost, period of recognition | 2 years | |||
Selling General and Administrative Expenses | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Pre-tax compensation expense | 17 | $ 13 | $ 33 | $ 25 |
Related income tax benefit | $ 6 | $ 5 | $ 12 | $ 9 |
Stock Compensation - Stock Options (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
6 Months Ended | |
---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
|
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Outstanding, beginning of period (in shares) | 19 | 21 |
Granted (in shares) | 3 | 3 |
Exercised (in shares) | (4) | (2) |
Forfeitures and expirations (in shares) | 0 | 0 |
Outstanding, end of period (in shares) | 18 | 22 |
Exercisable, end of period (in shares) | 10 | 13 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Outstanding, beginning of period, weighted-average exercise price (in dollars per share) | $ 58 | $ 56 |
Granted, weighted-average exercise price (in dollars per share) | 76 | 64 |
Exercised, weighted-average exercise price (in dollars per share) | 56 | 53 |
Forfeitures and expirations, weighted-average exercise price (in dollars per share) | 0 | 0 |
Outstanding, end of period, weighted-average exercise price (in dollars per share) | 61 | 57 |
Exercisable, end of period, weighted-average exercise price (in dollars per share) | $ 57 | $ 55 |
Outstanding, end of period, weighted-average remaining contractual term | 7 years 2 months 12 days | 7 years 1 month 6 days |
Exercisable, end of period, weighted-average remaining contractual term | 6 years 2 months 12 days | 6 years 1 month 6 days |
Outstanding, end of period, aggregate intrinsic value | $ 335 | $ 131 |
Exercisable, end of period, aggregate intrinsic value | $ 247 | $ 114 |
Weighted-average fair value of options granted (in dollars per share) | $ 9.44 | $ 7.20 |
Stock Compensation - Schedule of Fair Value Assumptions (Details) - Stock Options - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted- average expected volatility | 17.00% | 16.00% |
Weighted- average expected term (years) | 6 years 10 months 13 days | 6 years 10 months 13 days |
Weighted- average risk-free interest rate | 1.60% | 1.98% |
Dividend yield | 2.60% | 3.00% |
Total intrinsic value of options exercised | $ 79 | $ 23 |
Stock Compensation - Performance Shares (Details) - USD ($) $ / shares in Units, $ in Millions |
6 Months Ended | ||
---|---|---|---|
Jul. 04, 2015 |
Jul. 02, 2016 |
Feb. 28, 2015 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of performance shares that may be earned upon performance, minimum | 0.00% | ||
Percentage of performance shares that may be earned upon performance, maximum | 200.00% | ||
2013 Award | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance share award settlement as a percentage of target | 35.00% | ||
Performance share award settlement | $ 3 | ||
2014 Award | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Maximum fair value of performance shares | $ 32 | ||
2015 Award | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance shares target vesting period | 3 years | ||
Performance award condition time period | 3 years | ||
Maximum fair value of performance shares | $ 27 | ||
2016 Award | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance shares target grant distribution (in shares) | 188,000 | ||
Grant-date fair value of shares that correspond with target grants | $ 76 | ||
Maximum fair value of performance shares | $ 31 |
Stock Compensation - Restricted Stock (Details) - Restricted Stock and Restricted Stock Units - $ / shares shares in Thousands |
6 Months Ended | |
---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
|
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Non-vested, beginning of year (in shares) | 806 | 346 |
Granted (in shares) | 574 | 563 |
Vested (in shares) | (51) | (79) |
Forfeited (in shares) | (55) | (17) |
Non-vested, end of year (in shares) | 1,274 | 813 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||
Non-vested, beginning of year, weighted-average grant-date fair value (in dollars per share) | $ 58 | $ 54 |
Granted, weighted-average grant-date fair value (in dollars per share) | 70 | 58 |
Vested, weighted-average grant-date fair value (in dollars per share) | 55 | 51 |
Forfeited, weighted-average grant-date fair value (in dollars per share) | 62 | 56 |
Non-vested, end of year, weighted-average grant-date fair value (in dollars per share) | $ 63 | $ 57 |
Employee Benefits - Components of Plan Benefit Expense (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
|
Pension | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 25 | $ 28 | $ 49 | $ 56 |
Interest cost | 44 | 53 | 88 | 106 |
Expected return on plan assets | (90) | (100) | (179) | (200) |
Amortization of unrecognized prior service cost (credit) | 4 | 3 | 7 | 6 |
Total plan benefit (income) expense | (17) | (16) | (35) | (32) |
Other Nonpension Postretirement | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 5 | 9 | 10 | 17 |
Interest cost | 9 | 13 | 19 | 25 |
Expected return on plan assets | (23) | (25) | (45) | (50) |
Amortization of unrecognized prior service cost (credit) | (2) | (1) | (5) | (1) |
Total plan benefit (income) expense | (11) | (4) | (21) | (9) |
Postemployment | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 2 | 1 | 4 | 3 |
Interest cost | 1 | 1 | 2 | 2 |
Recognized net loss | 1 | 1 | 2 | 2 |
Total plan benefit (income) expense | $ 4 | $ 3 | $ 8 | $ 7 |
Employee Benefits - Contributions to Employee Benefit Plans (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
Jan. 02, 2016 |
|
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer contributions to employee benefit plans | $ 6 | $ 5 | $ 23 | $ 17 | $ 33 |
Total current year projected employer contributions | 43 | ||||
Pension | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer contributions to employee benefit plans | 2 | 1 | 15 | 10 | 19 |
Total current year projected employer contributions | 28 | ||||
Nonpension postretirement | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer contributions to employee benefit plans | $ 4 | $ 4 | 8 | $ 7 | $ 14 |
Total current year projected employer contributions | $ 15 |
Income Taxes - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
Jan. 02, 2016 |
|
Income Tax Contingency [Line Items] | |||||
Effective income tax rate | 27.00% | 28.00% | 25.00% | 26.00% | |
Unrecognized tax benefits | $ 77 | $ 77 | $ 73 | ||
Projected additions to unrecognized tax benefits | 8 | 8 | |||
Unrecognized tax benefits that would affect the effective income tax rate | 50 | 50 | |||
Other current liabilities | |||||
Income Tax Contingency [Line Items] | |||||
Unrecognized tax benefits | $ 14 | $ 14 |
Income Taxes - Reconciliation of Total Gross Unrecognized Tax Benefits (Details) $ in Millions |
6 Months Ended |
---|---|
Jul. 02, 2016
USD ($)
| |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |
Beginning balance | $ 73 |
Additions, current year | 3 |
Reductions, current year | 0 |
Additions, prior years | 1 |
Reductions, prior years | 0 |
Settlements | 0 |
Ending balance | $ 77 |
Income Taxes - Income Tax-Related Interest Accrued (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |
---|---|---|---|
Jul. 02, 2016 |
Jul. 02, 2016 |
Jul. 04, 2015 |
|
Income Tax Disclosure [Abstract] | |||
Tax-related interest and penalties | $ 1 | $ 2 | $ 0 |
Tax-related interest and penalties accrual | $ 19 | $ 19 |
Derivative Instruments and Fair Value Measurements - Schedule of Total Notional Amounts of Derivative Instruments(Details) - USD ($) $ in Millions |
Jul. 02, 2016 |
Jan. 02, 2016 |
---|---|---|
Derivatives, Fair Value [Line Items] | ||
Notional amount of derivatives | $ 2,426 | $ 1,680 |
Foreign currency exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount of derivatives | 1,288 | 1,210 |
Interest rate contracts | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount of derivatives | 668 | 0 |
Commodity contracts | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount of derivatives | $ 470 | $ 470 |
Derivative Instruments and Fair Value Measurements - Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Millions |
Jul. 02, 2016 |
Jan. 02, 2016 |
|||
---|---|---|---|---|---|
Derivatives, Fair Value [Line Items] | |||||
Fair Value Of Related Hedge Portion Of Long Term Debt | $ 668 | ||||
Long-term debt total, carrying value | 7,421 | ||||
Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 30 | $ 11 | |||
Liabilities | (18) | (24) | |||
Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 16 | 22 | |||
Liabilities | (21) | (39) | |||
Level 1 | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 0 | 0 | |||
Liabilities | 0 | 0 | |||
Level 1 | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 7 | 4 | |||
Liabilities | (16) | (33) | |||
Level 2 | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 30 | 11 | |||
Liabilities | (18) | (24) | |||
Level 2 | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 9 | 18 | |||
Liabilities | (5) | (6) | |||
Foreign currency exchange contracts | Other prepaid assets | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 20 | 11 | |||
Foreign currency exchange contracts | Other prepaid assets | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 9 | 18 | |||
Foreign currency exchange contracts | Other prepaid assets | Level 1 | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 0 | 0 | |||
Foreign currency exchange contracts | Other prepaid assets | Level 1 | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 0 | 0 | |||
Foreign currency exchange contracts | Other prepaid assets | Level 2 | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 20 | 11 | |||
Foreign currency exchange contracts | Other prepaid assets | Level 2 | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 9 | 18 | |||
Foreign currency exchange contracts | Other current liabilities | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Liabilities | (12) | (10) | |||
Foreign currency exchange contracts | Other current liabilities | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Liabilities | (5) | (6) | |||
Foreign currency exchange contracts | Other current liabilities | Level 1 | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Liabilities | 0 | 0 | |||
Foreign currency exchange contracts | Other current liabilities | Level 1 | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Liabilities | 0 | 0 | |||
Foreign currency exchange contracts | Other current liabilities | Level 2 | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Liabilities | (12) | (10) | |||
Foreign currency exchange contracts | Other current liabilities | Level 2 | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Liabilities | (5) | (6) | |||
Interest rate contracts | Other Assets [Member] | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 10 | 0 | [1] | ||
Interest rate contracts | Other Assets [Member] | Level 1 | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 0 | 0 | [1] | ||
Interest rate contracts | Other Assets [Member] | Level 2 | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 10 | 0 | [1] | ||
Commodity contracts | Other prepaid assets | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 7 | 4 | |||
Commodity contracts | Other prepaid assets | Level 1 | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 7 | 4 | |||
Commodity contracts | Other prepaid assets | Level 2 | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Assets | 0 | 0 | |||
Commodity contracts | Other current liabilities | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Liabilities | (6) | (14) | |||
Commodity contracts | Other current liabilities | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Liabilities | (16) | (33) | |||
Commodity contracts | Other current liabilities | Level 1 | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Liabilities | 0 | 0 | |||
Commodity contracts | Other current liabilities | Level 1 | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Liabilities | (16) | (33) | |||
Commodity contracts | Other current liabilities | Level 2 | Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Liabilities | (6) | (14) | |||
Commodity contracts | Other current liabilities | Level 2 | Not Designated as Hedging Instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Liabilities | 0 | 0 | |||
Net Investment Hedging | |||||
Derivatives, Fair Value [Line Items] | |||||
Long-term debt total, carrying value | $ 1,900 | $ 1,200 | |||
|
Derivative Instruments and Fair Value Measurements - Schedule of Offsetting Assets and Liabilities (Details) - USD ($) $ in Millions |
Jul. 02, 2016 |
Jan. 02, 2016 |
---|---|---|
Offsetting [Abstract] | ||
Asset derivatives, Amounts Presented in the Consolidated Balance Sheet | $ 46 | $ 33 |
Asset derivatives, Financial Instruments, Gross Amounts Not Offset in the Consolidated Balance Sheet | (12) | (12) |
Asset derivatives, Cash Collateral Posted, Gross Amounts Not Offset in the Consolidated Balance Sheet | 0 | 0 |
Asset derivatives, Net Amount | 34 | 21 |
Liability derivatives, Amounts Presented in the Consolidated Balance Sheet | (39) | (63) |
Liability derivatives, Financial Instruments, Gross Amounts Not Offset in the Consolidated Balance Sheet | 12 | 12 |
Liability derivatives, Cash Collateral Received, Gross Amounts Not Offset in the Consolidated Balance Sheet | 27 | 51 |
Liability derivatives, net amount | $ 0 | $ 0 |
Derivative Instruments and Fair Value Measurements - Effect of Derivative Instruments on the Consolidated Statements of Income and Comprehensive Income (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jul. 02, 2016 |
Jul. 04, 2015 |
Jul. 02, 2016 |
Jul. 04, 2015 |
||||
Not Designated as Hedging Instrument | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in income | $ 6 | $ 20 | $ 12 | $ 11 | |||
Not Designated as Hedging Instrument | Foreign currency exchange contracts | COGS | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in income | (1) | 1 | (10) | 1 | |||
Not Designated as Hedging Instrument | Foreign currency exchange contracts | Other income (expense), net | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in income | (1) | 5 | 10 | 7 | |||
Not Designated as Hedging Instrument | Interest rate contracts | Interest expense | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in income | 0 | 0 | |||||
Not Designated as Hedging Instrument | Commodity contracts | COGS | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in income | 6 | 13 | 10 | 2 | |||
Not Designated as Hedging Instrument | Commodity contracts | SGA | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in income | 2 | 1 | 2 | 1 | |||
Fair Value Hedges | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in income | [1] | 3 | (2) | 9 | 3 | ||
Fair Value Hedges | Foreign currency exchange contracts | Other income (expense), net | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in income | [1] | 0 | 0 | 0 | (4) | ||
Fair Value Hedges | Interest rate contracts | Interest expense | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in income | [1] | 3 | (2) | 9 | 7 | ||
Cash Flow Hedging | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in AOCI | (3) | (4) | (60) | 4 | |||
Gain (loss) reclassified from AOCI into income | (6) | 3 | (8) | 7 | |||
Gain (loss) recognized in income | [1] | (1) | (2) | (1) | (2) | ||
Cash Flow Hedging | Foreign Exchange Contracts, One [Member] | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in AOCI | (1) | 2 | 9 | 19 | |||
Cash Flow Hedging | Foreign Exchange Contracts, One [Member] | COGS | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) reclassified from AOCI into income | 0 | 9 | 7 | 16 | |||
Cash Flow Hedging | Foreign Exchange Contracts, One [Member] | Other income (expense), net | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in income | [1] | (1) | (2) | (1) | (2) | ||
Cash Flow Hedging | Foreign Exchange Contracts, Two [Member] | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in AOCI | 0 | (6) | 0 | (6) | |||
Cash Flow Hedging | Foreign Exchange Contracts, Two [Member] | SGA | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) reclassified from AOCI into income | 0 | (2) | 0 | (2) | |||
Cash Flow Hedging | Foreign Exchange Contracts, Two [Member] | Other income (expense), net | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in income | [1] | 0 | 0 | 0 | 0 | ||
Cash Flow Hedging | Interest rate contracts | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in AOCI | (3) | 0 | (69) | (9) | |||
Gain (loss) recognized in income | [1] | 0 | 0 | 0 | 0 | ||
Cash Flow Hedging | Interest rate contracts | Interest expense | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) reclassified from AOCI into income | (2) | (1) | (8) | (1) | |||
Cash Flow Hedging | Commodity contracts | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in AOCI | 1 | 0 | 0 | 0 | |||
Cash Flow Hedging | Commodity contracts | COGS | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) reclassified from AOCI into income | (4) | (3) | (7) | (6) | |||
Cash Flow Hedging | Commodity contracts | Other income (expense), net | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in income | [1] | 0 | 0 | 0 | 0 | ||
Net Investment Hedging | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in AOCI | 45 | (14) | (35) | 43 | |||
Net Investment Hedging | Foreign currency denominated long-term debt | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in AOCI | 46 | (14) | (12) | 43 | |||
Net Investment Hedging | Foreign currency exchange contracts | |||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||
Gain (loss) recognized in AOCI | $ (1) | $ 0 | $ (23) | $ 0 | |||
|
Derivative Instruments and Fair Value Measurements - Narrative (Details) $ in Millions |
6 Months Ended |
---|---|
Jul. 02, 2016
USD ($)
| |
Derivative [Line Items] | |
Net deferred gains reported in AOCI to be reclassified into income in the next twelve months | $ 9 |
Fair value of derivative instruments with credit-risk-related contingent features in a liability position | 5 |
Additional collateral required to be posted if the credit risk related contingent features were triggered | 5 |
Collateral posted | 0 |
Accounts Receivable, Net | |
Derivative [Line Items] | |
Collateral posted | 0 |
Accounts Receivable, Net | Exchange-traded commodity | |
Derivative [Line Items] | |
Margin deposits | $ 27 |
Five Largest Accounts | Customer Concentration Risk | Accounts Receivable, Net | |
Derivative [Line Items] | |
Concentration percentage | 24.00% |
Derivative Instruments and Fair Value Measurements - Other Fair Value Measurements (Details) - Fair Value, Measurements, Nonrecurring [Member] - USD ($) $ in Millions |
Jul. 02, 2016 |
Jul. 04, 2015 |
---|---|---|
Fair Value | Level 3 | ||
Derivatives, Fair Value [Line Items] | ||
Assets, Fair Value Disclosure | $ 10 | $ 15 |
Changes in fair value | Level 3 | ||
Derivatives, Fair Value [Line Items] | ||
Assets, Fair Value Disclosure | (16) | (67) |
Long-Lived Assets | Fair Value | Level 3 | ||
Derivatives, Fair Value [Line Items] | ||
Assets, Fair Value Disclosure | 10 | 15 |
Long-Lived Assets | Changes in fair value | Level 3 | ||
Derivatives, Fair Value [Line Items] | ||
Assets, Fair Value Disclosure | (16) | (67) |
Long-Lived Assets | North America Other | Manufacturing Facility | Carrying Value | ||
Derivatives, Fair Value [Line Items] | ||
Assets, Fair Value Disclosure | 31 | |
Long-Lived Assets | North America Other | Manufacturing Facility | Fair Value | ||
Derivatives, Fair Value [Line Items] | ||
Assets, Fair Value Disclosure | 13 | |
Long-Lived Assets | U.S. Snacks | Manufacturing Facility | Carrying Value | ||
Derivatives, Fair Value [Line Items] | ||
Assets, Fair Value Disclosure | 26 | |
Long-Lived Assets | U.S. Snacks | Manufacturing Facility | Fair Value | ||
Derivatives, Fair Value [Line Items] | ||
Assets, Fair Value Disclosure | $ 10 | |
Long-Lived Assets | Venezuelan Subsidiary [Member] | Carrying Value | ||
Derivatives, Fair Value [Line Items] | ||
Assets, Fair Value Disclosure | 51 | |
Long-Lived Assets | Venezuelan Subsidiary [Member] | Fair Value | ||
Derivatives, Fair Value [Line Items] | ||
Assets, Fair Value Disclosure | $ 2 |
Derivative Instruments and Fair Value Measurements - Schedule of Fair Value of Long-term Debt (Details) - USD ($) $ in Millions |
Jul. 02, 2016 |
Jan. 02, 2016 |
[1] | ||
---|---|---|---|---|---|
Derivative Instruments and Fair Value Measurements [Abstract] | |||||
Current maturities of long-term debt, fair value | $ 1,144 | ||||
Long-term debt, fair value | 6,815 | ||||
Long-term debt fair value, total | 7,959 | ||||
Current maturities of long-term debt, carrying value | 1,144 | $ 1,266 | |||
Long-term debt, carrying value | 6,277 | $ 5,275 | |||
Long-term debt total, carrying value | $ 7,421 | ||||
|
Venezuela - Narrative (Details) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jul. 04, 2015
USD ($)
VEF / $
|
Jul. 02, 2016
VEF / $
|
Jul. 04, 2015
VEF / $
|
Feb. 29, 2016
VEF / $
|
|
Venezuela Remeasurement Charge, Pretax | $ 152 | |||
Venezuela | ||||
Percentage Of Raw Materials | 2.00% | |||
DIPRO (formerly known as CENCOEX) | ||||
Foreign Currency Exchange Rate Devaluation | 59.00% | |||
DIPRO (formerly known as CENCOEX) | Venezuelan bolívar fuerte | ||||
Foreign exchange rate | VEF / $ | 6.3 | 10.0 | 6.3 | 10.0 |
DICOM (formerly known as SIMADI) | Venezuelan bolívar fuerte | ||||
Foreign exchange rate | VEF / $ | 632.9 | 206 | ||
Cost of Goods Sold | ||||
Venezuela Remeasurement Charge, Pretax | $ 100 | |||
Cost of Goods Sold | Asset impairment | ||||
Venezuela Remeasurement Charge, Pretax | 49 | |||
Cost of Goods Sold | Inventory | ||||
Venezuela Remeasurement Charge, Pretax | 56 | |||
Selling General and Administrative Expenses | ||||
Venezuela Remeasurement Charge, Pretax | 3 | |||
Other Income (Expense), Net | ||||
Venezuela Remeasurement Charge, Pretax | 49 | |||
Other Income (Expense), Net | Net Monetary Asset | ||||
Venezuela Remeasurement Charge, Pretax | $ 47 | |||
Geographic Concentration Risk [Member] | Venezuela | Net Sales | ||||
Percentage of net sales | 1.00% | 3.00% |
Reportable Segments (Details) $ in Millions |
3 Months Ended | 6 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 02, 2016
USD ($)
|
Jul. 04, 2015
USD ($)
|
Jul. 02, 2016
USD ($)
|
Jul. 04, 2015
USD ($)
|
||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Non-cash gain from deconsolidation | $ 0 | $ 49 | |||||||||||
Number of operating segments | 9 | ||||||||||||
Number of remaining reportable segments based on geographical locations | 3 | ||||||||||||
Net sales | $ 3,268 | $ 3,498 | $ 6,663 | 7,054 | |||||||||
Operating profit (loss) | 449 | 412 | 887 | 796 | |||||||||
Venezuela remeasurement | 11 | 152 | |||||||||||
Mark-to-market adjustments for pension plans, commodity and foreign currency contracts | 20 | 35 | (4) | (32) | |||||||||
Operating Profit [Member] | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Non-cash gain from deconsolidation | 67 | 67 | |||||||||||
Venezuela remeasurement | 7 | 103 | 13 | 103 | |||||||||
Operating Segments | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Operating profit (loss) | 441 | 398 | 913 | 866 | |||||||||
Operating Segments | U.S. Morning Foods | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales | 727 | 742 | 1,494 | 1,518 | |||||||||
Operating profit (loss) | 165 | 131 | 313 | 258 | |||||||||
Operating Segments | U.S. Snacks | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales | 803 | 835 | 1,635 | 1,689 | |||||||||
Operating profit (loss) | 69 | 160 | [1] | 152 | 240 | [1] | |||||||
Operating Segments | U.S. Specialty | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales | 271 | 270 | 647 | 631 | |||||||||
Operating profit (loss) | 60 | 59 | 146 | 137 | |||||||||
Operating Segments | North America Other | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales | 406 | 439 | 820 | 872 | |||||||||
Operating profit (loss) | 47 | 37 | 92 | 96 | |||||||||
Operating Segments | Europe | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales | 629 | 650 | 1,227 | 1,257 | |||||||||
Operating profit (loss) | 68 | 57 | 138 | 118 | |||||||||
Operating Segments | Latin America | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales | 204 | 328 | 396 | 623 | |||||||||
Operating profit (loss) | [2] | 20 | (56) | 43 | (5) | ||||||||
Operating Segments | Asia Pacific | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales | 228 | 234 | 444 | 464 | |||||||||
Operating profit (loss) | 12 | 10 | 29 | 22 | |||||||||
Corporate | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Operating profit (loss) | [3] | $ 8 | $ 14 | $ (26) | $ (70) | ||||||||
|
Subsequent event (Details) $ in Millions |
Jul. 02, 2016
USD ($)
|
---|---|
Maximum | Kellogg Funding Company Program [Member] | |
Subsequent Event [Line Items] | |
Financing receivable | $ 200 |
8ZX^*+/=O%1/]9]5^W0X=XOO3=\W
MI_%]VF/3]+5C5_+%[9R>Z^KA^N58/_;#Q\Q];J>7C].7OGFYO$N]OM#=_@=0
M2P,$% @ A(((21?1^FHO @ ; 8 !@ !X;"]W;W)K @:6R,-DXN7E,"T$X8I^95^L45&HI0+F 3 C/E$
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MU;#(7(80D"GE).."G0'8I>SC\70GNF/0 ?:5@@
M"0DD7B#9E$BV)7K,:8O9ATW2;TS2E4"2!#W2C4<2]LB^\<@V FG09(O)OIC@
MU>7@(!O7 PJ58NQ=QZVB2YL]$'>Y;O B'V@#SU0V7:_066AS1=U]JH708)*(
M[TRIK7D(E@6#6MOIO9E+WQM^H<5P[?3EN2D^ 5!+ P04 " "$@@A)3NVC
M=L(! ![! &0 'AL+W=O $BG/ %PI;
M+H ]Q@5@A:*62^2]2, *E1-P!4@0![("3K'/%^R+V*L-@CTI$#>( G&*6FX!
M!>*+@,PC9BALN4.VA_M\206%K4@!"1(IX(R@N!4,T"#A 2VYH9/Q;6'I&
M42V9OR:(#R^H2R8H>/""^NPYJ$L$*/4@!J5X&/VCPL0 GJZ.20GF9V]B;//G
MVM[0V(,85-_>O*2V+T:7O<7;N$1Y1]1N\Z;S3-20\,'Z5YP_ '3"/L@6*&T
M\4NJP3I4-TI&%']/J]!Q'=.? YMHZP0V$=A,^)9'XZE1M/F=.UX6!D=BTM;V
M/)S@YLC\1E3$QJ))TWNCUE>O)6/[@EZ#T(1A$7->8C8S@GKUN05;:S'1V;+%
M.GV[1M\FA]M/#@_K KLU@5T2V/UOQ(0Y?\;&PO
M=V]R:W-H965T
LS;:;NKJLZO'MG;-^D[ ;V2WU;M4,
M#^MQ?;NE:+JGKULAQ29Y[0>:VO"AS;W?AEU;)-WH5Q,\9&+JSKWN/&3@P6]A
M9-B""%D0HQ-BX41D !D:0(X#R,4 :CE),[HQMCF-J\!TV(@BC"C?B'AG1(]&
ME&
.'MCK/%P2OMQ2W_P-02P,$% @
MA(((2:P] %'X P W1< !D !X;"]W;W)KF:49P8E*$%=U*F%T)\- ?%
M3'L9=8T$0A1//0 94B.#D#\SS%#5;P(6U3=(1ROX))V"10T-(6REDZRJG<16
M/(F_8@'T-Y-@XV.'2/9.Z]6-=%&29?)A$3D-'S<;7W!6)SGXK0;$2+IQZX10K
M4/F*,L