Delaware | 1-4171 | 38-0710690 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). | |||
Emerging growth company | o | ||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange | |||
Act. | o |
• | ASU 2014-09: Revenue from contracts with customers ("Revenue Recognition") |
• | ASU 2017-07: Improving the Presentation of net Periodic Pension Cost and net Periodic Postretirement Benefit Cost ("Pension") |
• | ASU 2016-15: Classification of Certain Cash Receipts and Payments ("Cash Flow") |
KELLOGG COMPANY | ||
Date: April 19, 2018 | /s/ Fareed Khan | |
Name: Fareed Khan | ||
Title: Senior Vice President and Chief Financial Officer |
• | Revenue Recognition ASU - The adoption of this ASU will result in transfers between Net Sales, Cost of Goods Sold, and Selling, General & Administrative expenses on the Income Statement. There will be a small impact on the Company’s Operating Profit and Net Income, related to promotional allowances, and this will recast 2017 Adjusted EPS by approximately $(0.03) per share. |
• | Pension ASU - The adoption of this ASU will result in reclassifying the Interest Cost, Return on Assets, and Prior Service Cost components of Pension & Post-Retirement expense out of Cost of Goods Sold and Selling, General & Administrative expenses, and into Other Income & Expense. There is no impact on the Company’s Net Income, only a shift between Operating Profit (in the Corporate reporting segment only) and Other Income & Expense. |
• | Product Transfers Between Reportable Segments - This does not affect the Income Statement, but it does affect results for Reportable Segments. The Company has decided to transfer certain stock-keeping units (SKUs) from the U.S. Morning Foods reporting segment and to the U.S. Snacks reportable segment to align their sales with their infrastructure and change in accountability. There is no impact on the Company’s or North America's Net Sales, Operating Profit, Net Income, or Cash Flow. Recast 2017 segment results are provided below for 2018 comparability. |
• | Currency-neutral net sales and organic net sales: We adjust the GAAP financial measure to exclude the impact of foreign currency, resulting in currency-neutral sales. In addition, we exclude the impact of acquisitions, dispositions, related integration costs, shipping day differences, and foreign currency, resulting in organic net sales. We excluded the items which we believe may obscure trends in our underlying net sales performance. By providing these non-GAAP net sales measures, 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 these non-GAAP measures to evaluate the effectiveness of initiatives behind net sales growth, pricing realization, and the impact of mix on our business results. These non-GAAP measures are also used to make decisions regarding the future direction of our business, and for resource allocation decisions. |
• | Currency-neutral adjusted operating profit and currency-neutral adjusted diluted EPS: We adjust the GAAP financial measures to exclude the effect of Project K and cost reduction activities, mark-to-market adjustments for pension plans, commodities and certain foreign currency contracts. 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, |
• | 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 April 1, 2017 | Quarter ended July 1, 2017 | Quarter ended September 30, 2017 | Quarter ended December 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Change | Accounting Change | Accounting Change | Accounting Change | ||||||||||||||||||||||||||||||||||||||||||||||||
(Results are unaudited) | Previously Reported | Revenue Recognition | Pension | Recast | Previously Reported | Revenue Recognition | Pension | Recast | Previously Reported | Revenue Recognition | Pension | Recast | Previously Reported | Revenue Recognition | Pension | Recast | |||||||||||||||||||||||||||||||||||
Net sales | $ | 3,254 | $ | (6 | ) | $ | — | $ | 3,248 | $ | 3,187 | $ | (12 | ) | $ | — | $ | 3,175 | $ | 3,273 | $ | (27 | ) | $ | — | $ | 3,246 | $ | 3,209 | $ | (24 | ) | $ | — | $ | 3,185 | |||||||||||||||
Cost of goods sold | 2,050 | (16 | ) | 54 | 2,088 | 1,922 | (17 | ) | 45 | 1,950 | 2,041 | (21 | ) | 54 | 2,074 | 1,888 | (17 | ) | 172 | 2,043 | |||||||||||||||||||||||||||||||
Selling, general and administrative expense | 844 | 5 | 31 | 880 | 812 | 4 | 24 | 840 | 768 | 6 | 65 | 839 | 652 | 4 | 97 | 753 | |||||||||||||||||||||||||||||||||||
Operating profit | 360 | 5 | (85 | ) | 280 | 453 | 1 | (69 | ) | 385 | 464 | (12 | ) | (119 | ) | 333 | 669 | (11 | ) | (269 | ) | 389 | |||||||||||||||||||||||||||||
Other income (expense), net | 3 | — | 85 | 88 | (6 | ) | — | 69 | 63 | (2 | ) | — | 119 | 117 | (11 | ) | — | 269 | 258 | ||||||||||||||||||||||||||||||||
Income taxes | 42 | 1 | — | 43 | 102 | — | — | 102 | 104 | (3 | ) | — | 101 | 164 | — | — | 164 | ||||||||||||||||||||||||||||||||||
Net income | $ | 262 | $ | 4 | $ | — | $ | 266 | $ | 282 | $ | 1 | $ | — | $ | 283 | $ | 297 | $ | (9 | ) | $ | — | $ | 288 | $ | 428 | $ | (11 | ) | $ | — | $ | 417 | |||||||||||||||||
Per share amounts: | |||||||||||||||||||||||||||||||||||||||||||||||||||
Basic | $ | 0.75 | $ | 0.01 | $ | — | $ | 0.76 | $ | 0.81 | $ | — | $ | — | $ | 0.81 | $ | 0.86 | $ | (0.03 | ) | $ | — | $ | 0.83 | $ | 1.24 | $ | (0.03 | ) | $ | — | $ | 1.21 | |||||||||||||||||
Diluted | $ | 0.74 | $ | 0.01 | $ | — | $ | 0.75 | $ | 0.80 | $ | — | $ | — | $ | 0.80 | $ | 0.85 | $ | (0.02 | ) | $ | — | $ | 0.83 | $ | 1.23 | $ | (0.03 | ) | $ | — | $ | 1.20 |
Year-to-date period ended April 1, 2017 | Year-to-date period ended July 1, 2017 | Year-to-date period ended September 30, 2017 | Year-to-date period ended December 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Change | Accounting Change | Accounting Change | Accounting Change | ||||||||||||||||||||||||||||||||||||||||||||||||
(Results are unaudited) | Previously Reported | Revenue Recognition | Pension | Recast | Previously Reported | Revenue Recognition | Pension | Recast | Previously Reported | Revenue Recognition | Pension | Recast | Previously Reported | Revenue Recognition | Pension | Recast | |||||||||||||||||||||||||||||||||||
Net sales | $ | 3,254 | $ | (6 | ) | $ | — | $ | 3,248 | $ | 6,441 | $ | (18 | ) | $ | — | $ | 6,423 | $ | 9,714 | $ | (45 | ) | $ | — | $ | 9,669 | $ | 12,923 | $ | (69 | ) | $ | — | $ | 12,854 | |||||||||||||||
Cost of goods sold | 2,050 | (16 | ) | 54 | 2,088 | 3,972 | (33 | ) | 99 | 4,038 | 6,013 | (54 | ) | 153 | 6,112 | 7,901 | (71 | ) | 325 | 8,155 | |||||||||||||||||||||||||||||||
Selling, general and administrative expense | 844 | 5 | 31 | 880 | 1,656 | 9 | 55 | 1,720 | 2,424 | 15 | 120 | 2,559 | 3,076 | 19 | 217 | 3,312 | |||||||||||||||||||||||||||||||||||
Operating profit | 360 | 5 | (85 | ) | 280 | 813 | 6 | (154 | ) | 665 | 1,277 | (6 | ) | (273 | ) | 998 | 1,946 | (17 | ) | (542 | ) | 1,387 | |||||||||||||||||||||||||||||
Other income (expense), net | 3 | — | 85 | 88 | (3 | ) | — | 154 | 151 | (5 | ) | — | 273 | 268 | (16 | ) | — | 542 | 526 | ||||||||||||||||||||||||||||||||
Income taxes | 42 | 1 | — | 43 | 144 | 1 | — | 145 | 248 | (2 | ) | — | 246 | 412 | (2 | ) | — | 410 | |||||||||||||||||||||||||||||||||
Net income | $ | 262 | $ | 4 | $ | — | $ | 266 | $ | 544 | $ | 5 | $ | — | $ | 549 | $ | 841 | $ | (4 | ) | $ | — | $ | 837 | $ | 1,269 | $ | (15 | ) | $ | — | $ | 1,254 | |||||||||||||||||
Per share amounts: | |||||||||||||||||||||||||||||||||||||||||||||||||||
Basic | $ | 0.75 | $ | 0.01 | $ | — | $ | 0.76 | $ | 1.56 | $ | 0.01 | $ | — | $ | 1.57 | $ | 2.41 | $ | (0.01 | ) | $ | — | $ | 2.40 | $ | 3.65 | $ | (0.04 | ) | $ | — | $ | 3.61 | |||||||||||||||||
Diluted | $ | 0.74 | $ | 0.01 | $ | — | $ | 0.75 | $ | 1.54 | $ | 0.02 | $ | — | $ | 1.56 | $ | 2.39 | $ | (0.01 | ) | $ | — | $ | 2.38 | $ | 3.62 | $ | (0.04 | ) | $ | — | $ | 3.58 |
Quarter ended April 1, 2017 | |||||||||||||||||||||
(Results are unaudited) | Cost of goods sold | Selling, general and administrative expense | Operating profit | Other income (expense) | Income taxes | Net income (loss) | Per share amount: Diluted | ||||||||||||||
Mark-to-market | $ | 45 | $ | 2 | $ | (47 | ) | $ | 26 | $ | — | $ | (21 | ) | $ | (0.06 | ) | ||||
Project K and cost reduction activities | 13 | 125 | (138 | ) | (4 | ) | — | (142 | ) | (0.40 | ) | ||||||||||
Income tax impact applicable to adjustments, net* | — | — | — | — | (50 | ) | 50 | 0.14 | |||||||||||||
Adjustments to adjusted basis | $ | 58 | $ | 127 | $ | (185 | ) | $ | 22 | $ | (50 | ) | $ | (113 | ) | $ | (0.32 | ) |
Quarter ended July 1, 2017 | |||||||||||||||||||||
(Results are unaudited) | Cost of goods sold | Selling, general and administrative expense | Operating profit | Other income (expense) | Income taxes | Net income (loss) | Per share amount: Diluted | ||||||||||||||
Mark-to-market | $ | (6 | ) | $ | 1 | $ | 5 | $ | 1 | $ | — | $ | 6 | $ | 0.02 | ||||||
Project K and cost reduction activities | 23 | 75 | (98 | ) | 3 | — | (95 | ) | (0.27 | ) | |||||||||||
Income tax impact applicable to adjustments, net* | — | — | — | — | (31 | ) | 31 | 0.08 | |||||||||||||
Adjustments to adjusted basis | $ | 17 | $ | 76 | $ | (93 | ) | $ | 4 | $ | (31 | ) | $ | (58 | ) | $ | (0.17 | ) |
Quarter ended September 30, 2017 | |||||||||||||||||||||
(Results are unaudited) | Cost of goods sold | Selling, general and administrative expense | Operating profit | Other income (expense) | Income taxes | Net income (loss) | Per share amount: Diluted | ||||||||||||||
Mark-to-market | $ | 21 | $ | — | $ | (21 | ) | $ | (82 | ) | $ | — | $ | (103 | ) | $ | (0.30 | ) | |||
Project K and cost reduction activities | 49 | 87 | (136 | ) | 134 | — | (2 | ) | — | ||||||||||||
Income tax impact applicable to adjustments, net* | — | — | — | — | (36 | ) | 36 | 0.10 | |||||||||||||
Adjustments to adjusted basis | $ | 70 | $ | 87 | $ | (157 | ) | $ | 52 | $ | (36 | ) | $ | (69 | ) | $ | (0.20 | ) |
Quarter ended December 30, 2017 | |||||||||||||||||||||
(Results are unaudited) | Cost of goods sold | Selling, general and administrative expense | Operating profit | Other income (expense) | Income taxes | Net income (loss) | Per share amount: Diluted | ||||||||||||||
Mark-to-market | $ | 19 | $ | (1 | ) | $ | (18 | ) | $ | 181 | $ | — | $ | 163 | $ | 0.47 | |||||
Project K and cost reduction activities | 30 | 9 | (39 | ) | 15 | — | (24 | ) | (0.07 | ) | |||||||||||
Income tax impact applicable to adjustments, net* | — | — | — | — | 37 | (37 | ) | (0.11 | ) | ||||||||||||
U.S. Tax Reform adoption impact | — | — | — | — | 8 | (8 | ) | (0.02 | ) | ||||||||||||
Adjustments to adjusted basis | $ | 49 | $ | 8 | $ | (57 | ) | $ | 196 | $ | 45 | $ | 94 | $ | 0.27 |
Quarter ended | ||||||||||||
(Results are unaudited) | April 1, 2017 | July 1, 2017 | September 30, 2017 | December 30, 2017 | ||||||||
Recast EPS | $ | 0.75 | $ | 0.80 | $ | 0.83 | $ | 1.20 | ||||
Mark-to-market (pre-tax) | (0.06 | ) | 0.02 | (0.30 | ) | 0.47 | ||||||
Project K and cost reduction activities (pre-tax) | (0.40 | ) | (0.27 | ) | — | (0.07 | ) | |||||
Income tax impact applicable to adjustments, net* | 0.14 | 0.08 | 0.10 | (0.11 | ) | |||||||
U.S. Tax Reform adoption impact | — | — | — | (0.02 | ) | |||||||
Adjusted EPS | $ | 1.07 | $ | 0.97 | $ | 1.03 | $ | 0.93 |
Year-to-date period ended | ||||||||||||
(Results are unaudited) | April 1, 2017 | July 1, 2017 | September 30, 2017 | December 30, 2017 | ||||||||
Recast EPS | $ | 0.75 | $ | 1.56 | $ | 2.38 | $ | 3.58 | ||||
Mark-to-market (pre-tax) | (0.06 | ) | (0.04 | ) | (0.34 | ) | 0.13 | |||||
Project K and cost reduction activities (pre-tax) | (0.40 | ) | (0.67 | ) | (0.68 | ) | (0.75 | ) | ||||
Income tax impact applicable to adjustments, net* | 0.14 | 0.23 | 0.33 | 0.22 | ||||||||
U.S. Tax Reform adoption impact | — | — | — | (0.02 | ) | |||||||
Adjusted EPS | $ | 1.07 | $ | 2.04 | $ | 3.07 | $ | 4.00 |
Quarter ended April 1, 2017 | Quarter ended July 1, 2017 | Quarter ended September 30, 2017 | Quarter ended December 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(millions) | Accounting Change | Accounting Change | Accounting Change | Accounting Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Sales | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | |||||||||||||||||||||||||||||||||||||||||||
U.S. Snacks | $ | 781 | $ | 1 | $ | — | $ | 13 | $ | 795 | $ | 803 | $ | (1 | ) | $ | — | $ | 13 | $ | 815 | $ | 760 | $ | (9 | ) | $ | — | $ | 13 | $ | 764 | $ | 723 | $ | — | $ | — | $ | 13 | $ | 736 | |||||||||||||||||||||
U.S. Morning Foods | 719 | 2 | — | (13 | ) | 708 | 679 | (2 | ) | — | (13 | ) | 664 | 710 | (5 | ) | — | (13 | ) | 692 | 670 | (12 | ) | — | (13 | ) | 645 | ||||||||||||||||||||||||||||||||||||
U.S. Specialty | 395 | (2 | ) | — | — | 393 | 276 | (1 | ) | — | — | 275 | 290 | (2 | ) | — | — | 288 | 288 | (2 | ) | — | — | 286 | |||||||||||||||||||||||||||||||||||||||
North America Other | 393 | (1 | ) | — | — | 392 | 391 | (1 | ) | — | — | 390 | 420 | (1 | ) | — | — | 419 | 412 | (1 | ) | — | — | 411 | |||||||||||||||||||||||||||||||||||||||
Total North America | $ | 2,288 | $ | — | $ | — | $ | — | $ | 2,288 | $ | 2,149 | $ | (5 | ) | $ | — | $ | — | $ | 2,144 | $ | 2,180 | $ | (17 | ) | $ | — | $ | — | $ | 2,163 | $ | 2,093 | $ | (15 | ) | $ | — | $ | — | $ | 2,078 | ||||||||||||||||||||
Europe | 512 | 1 | — | — | 513 | 566 | 1 | — | — | 567 | 599 | — | — | — | 599 | 614 | (2 | ) | — | — | 612 | ||||||||||||||||||||||||||||||||||||||||||
Latin America | 222 | (2 | ) | — | — | 220 | 234 | (2 | ) | — | — | 232 | 240 | (5 | ) | — | — | 235 | 259 | (2 | ) | — | — | 257 | |||||||||||||||||||||||||||||||||||||||
Asia Pacific | 232 | (5 | ) | — | — | 227 | 238 | (6 | ) | — | — | 232 | 254 | (5 | ) | — | — | 249 | 243 | (5 | ) | — | — | 238 | |||||||||||||||||||||||||||||||||||||||
Corporate | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Kellogg Consolidated | $ | 3,254 | $ | (6 | ) | $ | — | $ | — | $ | 3,248 | $ | 3,187 | $ | (12 | ) | $ | — | $ | — | $ | 3,175 | $ | 3,273 | $ | (27 | ) | $ | — | $ | — | $ | 3,246 | $ | 3,209 | $ | (24 | ) | $ | — | $ | — | $ | 3,185 | |||||||||||||||||||
Quarter ended April 1, 2017 | Quarter ended July 1, 2017 | Quarter ended September 30, 2017 | Quarter ended December 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(millions) | Accounting Change | Accounting Change | Accounting Change | Accounting Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating Profit | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | |||||||||||||||||||||||||||||||||||||||||||
U.S. Snacks | $ | (44 | ) | $ | 2 | $ | — | $ | 6 | $ | (36 | ) | $ | 22 | $ | — | $ | — | $ | 7 | $ | 29 | $ | 14 | $ | (7 | ) | $ | — | $ | 6 | $ | 13 | $ | 123 | $ | 1 | $ | — | $ | 8 | $ | 132 | ||||||||||||||||||||
U.S. Morning Foods | 160 | 3 | — | (6 | ) | 157 | 176 | 1 | — | (7 | ) | 170 | 141 | (3 | ) | — | (6 | ) | 132 | 124 | (8 | ) | — | (8 | ) | 108 | |||||||||||||||||||||||||||||||||||||
U.S. Specialty | 96 | — | — | — | 96 | 70 | — | — | — | 70 | 76 | — | — | — | 76 | 70 | — | — | — | 70 | |||||||||||||||||||||||||||||||||||||||||||
North America Other | 49 | — | — | — | 49 | 59 | — | — | — | 59 | 65 | — | — | — | 65 | 57 | (1 | ) | — | — | 56 | ||||||||||||||||||||||||||||||||||||||||||
Total North America | $ | 261 | $ | 5 | $ | — | $ | — | $ | 266 | $ | 327 | $ | 1 | $ | — | $ | — | $ | 328 | $ | 296 | $ | (10 | ) | $ | — | $ | — | $ | 286 | $ | 374 | $ | (8 | ) | $ | — | $ | — | $ | 366 | |||||||||||||||||||||
Europe | 66 | — | — | — | 66 | 76 | 1 | — | — | 77 | 72 | (1 | ) | — | — | 71 | 65 | (3 | ) | — | — | 62 | |||||||||||||||||||||||||||||||||||||||||
Latin America | 33 | — | — | — | 33 | 26 | — | — | — | 26 | 23 | — | — | — | 23 | 26 | — | — | — | 26 | |||||||||||||||||||||||||||||||||||||||||||
Asia Pacific | 22 | — | — | — | 22 | 19 | (1 | ) | — | — | 18 | 25 | (1 | ) | — | — | 24 | 20 | — | — | — | 20 | |||||||||||||||||||||||||||||||||||||||||
Corporate | (22 | ) | — | (85 | ) | — | (107 | ) | 5 | — | (69 | ) | — | (64 | ) | 48 | — | (119 | ) | — | (71 | ) | 184 | — | (269 | ) | — | (85 | ) | ||||||||||||||||||||||||||||||||||
Kellogg Consolidated | $ | 360 | $ | 5 | $ | (85 | ) | $ | — | $ | 280 | $ | 453 | $ | 1 | $ | (69 | ) | $ | — | $ | 385 | $ | 464 | $ | (12 | ) | $ | (119 | ) | $ | — | $ | 333 | $ | 669 | $ | (11 | ) | $ | (269 | ) | $ | — | $ | 389 |
Year-to-date period ended April 1, 2017 | Year-to-date period ended July 1, 2017 | Year-to-date period ended September 30, 2017 | Year-to-date period ended December 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(millions) | Accounting Change | Accounting Change | Accounting Change | Accounting Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Sales | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | |||||||||||||||||||||||||||||||||||||||||||
U.S. Snacks | $ | 781 | $ | 1 | $ | — | $ | 13 | $ | 795 | $ | 1,584 | $ | — | $ | — | $ | 26 | $ | 1,610 | $ | 2,344 | $ | (9 | ) | $ | — | $ | 39 | $ | 2,374 | $ | 3,067 | $ | (9 | ) | $ | — | $ | 52 | $ | 3,110 | |||||||||||||||||||||
U.S. Morning Foods | 719 | 2 | — | (13 | ) | 708 | 1,398 | — | — | (26 | ) | 1,372 | 2,108 | (5 | ) | — | (39 | ) | 2,064 | 2,778 | (17 | ) | — | (52 | ) | 2,709 | |||||||||||||||||||||||||||||||||||||
U.S. Specialty | 395 | (2 | ) | — | — | 393 | 671 | (3 | ) | — | — | 668 | 961 | (5 | ) | — | — | 956 | 1,249 | (7 | ) | — | — | 1,242 | |||||||||||||||||||||||||||||||||||||||
North America Other | 393 | (1 | ) | — | — | 392 | 784 | (2 | ) | — | — | 782 | 1,204 | (3 | ) | — | — | 1,201 | 1,616 | (4 | ) | — | — | 1,612 | |||||||||||||||||||||||||||||||||||||||
Total North America | $ | 2,288 | $ | — | $ | — | $ | — | $ | 2,288 | $ | 4,437 | $ | (5 | ) | $ | — | $ | — | $ | 4,432 | $ | 6,617 | $ | (22 | ) | $ | — | $ | — | $ | 6,595 | $ | 8,710 | $ | (37 | ) | $ | — | $ | — | $ | 8,673 | ||||||||||||||||||||
Europe | 512 | 1 | — | — | 513 | 1,078 | 2 | — | — | 1,080 | 1,677 | 2 | — | — | 1,679 | 2,291 | — | — | — | 2,291 | |||||||||||||||||||||||||||||||||||||||||||
Latin America | 222 | (2 | ) | — | — | 220 | 456 | (4 | ) | — | — | 452 | 696 | (9 | ) | — | — | 687 | 955 | (11 | ) | — | — | 944 | |||||||||||||||||||||||||||||||||||||||
Asia Pacific | 232 | (5 | ) | — | — | 227 | 470 | (11 | ) | — | — | 459 | 724 | (16 | ) | — | — | 708 | 967 | (21 | ) | — | — | 946 | |||||||||||||||||||||||||||||||||||||||
Corporate | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Kellogg Consolidated | $ | 3,254 | $ | (6 | ) | $ | — | $ | — | $ | 3,248 | $ | 6,441 | $ | (18 | ) | $ | — | $ | — | $ | 6,423 | $ | 9,714 | $ | (45 | ) | $ | — | $ | — | $ | 9,669 | $ | 12,923 | $ | (69 | ) | $ | — | $ | — | $ | 12,854 | |||||||||||||||||||
Year-to-date period ended April 1, 2017 | Year-to-date period ended July 1, 2017 | Year-to-date period ended September 30, 2017 | Year-to-date period ended December 30, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(millions) | Accounting Change | Accounting Change | Accounting Change | Accounting Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating Profit | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | Previously Reported | Revenue Recognition | Pension | Product Transfer | Recast | |||||||||||||||||||||||||||||||||||||||||||
U.S. Snacks | $ | (44 | ) | $ | 2 | $ | — | $ | 6 | $ | (36 | ) | $ | (22 | ) | $ | 2 | $ | — | $ | 13 | $ | (7 | ) | $ | (8 | ) | $ | (5 | ) | $ | — | $ | 19 | $ | 6 | $ | 115 | $ | (4 | ) | $ | — | $ | 27 | $ | 138 | ||||||||||||||||
U.S. Morning Foods | 160 | 3 | — | (6 | ) | 157 | 336 | 4 | — | (13 | ) | 327 | 477 | 1 | — | (19 | ) | 459 | 601 | (7 | ) | — | (27 | ) | 567 | ||||||||||||||||||||||||||||||||||||||
U.S. Specialty | 96 | — | — | — | 96 | 166 | — | — | — | 166 | 242 | — | — | — | 242 | 312 | — | — | — | 312 | |||||||||||||||||||||||||||||||||||||||||||
North America Other | 49 | — | — | — | 49 | 108 | — | — | — | 108 | 173 | — | — | — | 173 | 230 | (1 | ) | — | — | 229 | ||||||||||||||||||||||||||||||||||||||||||
Total North America | $ | 261 | $ | 5 | $ | — | $ | — | $ | 266 | $ | 588 | $ | 6 | $ | — | $ | — | $ | 594 | $ | 884 | $ | (4 | ) | $ | — | $ | — | $ | 880 | $ | 1,258 | $ | (12 | ) | $ | — | $ | — | $ | 1,246 | |||||||||||||||||||||
Europe | 66 | — | — | — | 66 | 142 | 1 | — | — | 143 | 214 | — | — | — | 214 | 279 | (3 | ) | — | — | 276 | ||||||||||||||||||||||||||||||||||||||||||
Latin America | 33 | — | — | — | 33 | 59 | — | — | — | 59 | 82 | — | — | — | 82 | 108 | — | — | — | 108 | |||||||||||||||||||||||||||||||||||||||||||
Asia Pacific | 22 | — | — | — | 22 | 41 | (1 | ) | — | — | 40 | 66 | (2 | ) | — | — | 64 | 86 | (2 | ) | — | — | 84 | ||||||||||||||||||||||||||||||||||||||||
Corporate | (22 | ) | — | (85 | ) | — | (107 | ) | (17 | ) | — | (154 | ) | — | (171 | ) | 31 | — | (273 | ) | — | (242 | ) | 215 | — | (542 | ) | — | (327 | ) | |||||||||||||||||||||||||||||||||
Kellogg Consolidated | $ | 360 | $ | 5 | $ | (85 | ) | $ | — | $ | 280 | $ | 813 | $ | 6 | $ | (154 | ) | $ | — | $ | 665 | $ | 1,277 | $ | (6 | ) | $ | (273 | ) | $ | — | $ | 998 | $ | 1,946 | $ | (17 | ) | $ | (542 | ) | $ | — | $ | 1,387 |
Quarter ended April 1, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast net sales | $ | 795 | $ | 708 | $ | 393 | $ | 392 | $ | 2,288 | $ | 513 | $ | 220 | $ | 227 | $ | — | $ | 3,248 | ||||||||||
Acquisitions/divestitures | — | — | — | 1 | 1 | 3 | 47 | — | — | 51 | ||||||||||||||||||||
Shipping day differences | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Organic net sales | $ | 795 | $ | 708 | $ | 393 | $ | 391 | $ | 2,287 | $ | 510 | $ | 173 | $ | 227 | $ | — | $ | 3,197 | ||||||||||
Quarter ended July 1, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast net sales | $ | 815 | $ | 664 | $ | 275 | $ | 390 | $ | 2,144 | $ | 567 | $ | 232 | $ | 232 | $ | — | $ | 3,175 | ||||||||||
Acquisitions/divestitures | — | — | — | — | — | 4 | 46 | — | — | 50 | ||||||||||||||||||||
Shipping day differences | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Organic net sales | $ | 815 | $ | 664 | $ | 275 | $ | 390 | $ | 2,144 | $ | 563 | $ | 186 | $ | 232 | $ | — | $ | 3,125 | ||||||||||
Quarter ended September 30, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast net sales | $ | 764 | $ | 692 | $ | 288 | $ | 419 | $ | 2,163 | $ | 599 | $ | 235 | $ | 249 | $ | — | $ | 3,246 | ||||||||||
Acquisitions/divestitures | — | — | — | — | — | 4 | 48 | — | — | 52 | ||||||||||||||||||||
Shipping day differences | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Organic net sales | $ | 764 | $ | 692 | $ | 288 | $ | 419 | $ | 2,163 | $ | 595 | $ | 187 | $ | 249 | $ | — | $ | 3,194 | ||||||||||
Quarter ended December 30, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast net sales | $ | 736 | $ | 645 | $ | 286 | $ | 411 | $ | 2,078 | $ | 612 | $ | 257 | $ | 238 | $ | — | $ | 3,185 | ||||||||||
Acquisitions/divestitures | — | — | — | 27 | 27 | — | 62 | — | — | 89 | ||||||||||||||||||||
Shipping day differences | — | — | — | — | — | — | 14 | — | — | 14 | ||||||||||||||||||||
Organic net sales | $ | 736 | $ | 645 | $ | 286 | $ | 384 | $ | 2,051 | $ | 612 | $ | 181 | $ | 238 | $ | — | $ | 3,082 |
Year-to-date period ended April 1, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast net sales | $ | 795 | $ | 708 | $ | 393 | $ | 392 | $ | 2,288 | $ | 513 | $ | 220 | $ | 227 | $ | — | $ | 3,248 | ||||||||||
Acquisitions/divestitures | — | — | — | 1 | 1 | 3 | 47 | — | — | 51 | ||||||||||||||||||||
Shipping day differences | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Organic net sales | $ | 795 | $ | 708 | $ | 393 | $ | 391 | $ | 2,287 | $ | 510 | $ | 173 | $ | 227 | $ | — | $ | 3,197 | ||||||||||
Year-to-date period ended July 1, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast net sales | $ | 1,610 | $ | 1,372 | $ | 668 | $ | 782 | $ | 4,432 | $ | 1,080 | $ | 452 | $ | 459 | $ | — | $ | 6,423 | ||||||||||
Acquisitions/divestitures | — | — | — | 1 | 1 | 7 | 93 | — | — | 101 | ||||||||||||||||||||
Shipping day differences | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Organic net sales | $ | 1,610 | $ | 1,372 | $ | 668 | $ | 781 | $ | 4,431 | $ | 1,073 | $ | 359 | $ | 459 | $ | — | $ | 6,322 | ||||||||||
Year-to-date period ended September 30, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast net sales | $ | 2,374 | $ | 2,064 | $ | 956 | $ | 1,201 | $ | 6,595 | $ | 1,679 | $ | 687 | $ | 708 | $ | — | $ | 9,669 | ||||||||||
Acquisitions/divestitures | — | — | — | 1 | 1 | 11 | 141 | — | — | 153 | ||||||||||||||||||||
Shipping day differences | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||
Organic net sales | $ | 2,374 | $ | 2,064 | $ | 956 | $ | 1,200 | $ | 6,594 | $ | 1,668 | $ | 546 | $ | 708 | $ | — | $ | 9,516 | ||||||||||
Year-to-date period ended December 30, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast net sales | $ | 3,110 | $ | 2,709 | $ | 1,242 | $ | 1,612 | $ | 8,673 | $ | 2,291 | $ | 944 | $ | 946 | $ | — | $ | 12,854 | ||||||||||
Acquisitions/divestitures | — | — | — | 28 | 28 | 11 | 203 | — | — | 242 | ||||||||||||||||||||
Shipping day differences | — | — | — | — | — | — | 14 | — | — | 14 | ||||||||||||||||||||
Organic net sales | $ | 3,110 | $ | 2,709 | $ | 1,242 | $ | 1,584 | $ | 8,645 | $ | 2,280 | $ | 727 | $ | 946 | $ | — | $ | 12,598 |
Quarter ended April 1, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast operating profit | $ | (36 | ) | $ | 157 | $ | 96 | $ | 49 | $ | 266 | $ | 66 | $ | 33 | $ | 22 | $ | (107 | ) | $ | 280 | ||||||||
Mark-to-market | — | — | — | — | — | — | — | — | (47 | ) | (47 | ) | ||||||||||||||||||
Project K and cost reduction activities | (120 | ) | (1 | ) | — | (7 | ) | (128 | ) | (6 | ) | (1 | ) | (1 | ) | (2 | ) | (138 | ) | |||||||||||
Adjusted operating profit | $ | 84 | $ | 158 | $ | 96 | $ | 56 | $ | 394 | $ | 72 | $ | 34 | $ | 23 | $ | (58 | ) | $ | 465 | |||||||||
Quarter ended July 1, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast operating profit | $ | 29 | $ | 170 | $ | 70 | $ | 59 | $ | 328 | $ | 77 | $ | 26 | $ | 18 | $ | (64 | ) | $ | 385 | |||||||||
Mark-to-market | — | — | — | — | — | — | — | — | 5 | 5 | ||||||||||||||||||||
Project K and cost reduction activities | (79 | ) | (1 | ) | (1 | ) | (2 | ) | (83 | ) | (2 | ) | (3 | ) | (3 | ) | (7 | ) | (98 | ) | ||||||||||
Adjusted operating profit | $ | 108 | $ | 171 | $ | 71 | $ | 61 | $ | 411 | $ | 79 | $ | 29 | $ | 21 | $ | (62 | ) | $ | 478 | |||||||||
Quarter ended September 30, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast operating profit | $ | 13 | $ | 132 | $ | 76 | $ | 65 | $ | 286 | $ | 71 | $ | 23 | $ | 24 | $ | (71 | ) | $ | 333 | |||||||||
Mark-to-market | — | — | — | — | — | — | — | — | (21 | ) | (21 | ) | ||||||||||||||||||
Project K and cost reduction activities | (106 | ) | (14 | ) | — | (4 | ) | (124 | ) | (13 | ) | (2 | ) | (1 | ) | 4 | (136 | ) | ||||||||||||
Adjusted operating profit | $ | 119 | $ | 146 | $ | 76 | $ | 69 | $ | 410 | $ | 84 | $ | 25 | $ | 25 | $ | (54 | ) | $ | 490 | |||||||||
Quarter ended December 30, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast operating profit | $ | 132 | $ | 108 | $ | 70 | $ | 56 | $ | 366 | $ | 62 | $ | 26 | $ | 20 | $ | (85 | ) | $ | 389 | |||||||||
Mark-to-market | — | — | — | — | — | — | — | — | (18 | ) | (18 | ) | ||||||||||||||||||
Project K and cost reduction activities | (4 | ) | (2 | ) | (1 | ) | (3 | ) | (10 | ) | (19 | ) | (2 | ) | (6 | ) | (2 | ) | (39 | ) | ||||||||||
Adjusted operating profit | $ | 136 | $ | 110 | $ | 71 | $ | 59 | $ | 376 | $ | 81 | $ | 28 | $ | 26 | $ | (65 | ) | $ | 446 |
Year-to-date period ended April 1, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast operating profit | $ | (36 | ) | $ | 157 | $ | 96 | $ | 49 | $ | 266 | $ | 66 | $ | 33 | $ | 22 | $ | (107 | ) | $ | 280 | ||||||||
Mark-to-market | — | — | — | — | — | — | — | — | (47 | ) | (47 | ) | ||||||||||||||||||
Project K and cost reduction activities | (120 | ) | (1 | ) | — | (7 | ) | (128 | ) | (6 | ) | (1 | ) | (1 | ) | (2 | ) | (138 | ) | |||||||||||
Adjusted operating profit | $ | 84 | $ | 158 | $ | 96 | $ | 56 | $ | 394 | $ | 72 | $ | 34 | $ | 23 | $ | (58 | ) | $ | 465 | |||||||||
Year-to-date period ended July 1, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast operating profit | $ | (7 | ) | $ | 327 | $ | 166 | $ | 108 | $ | 594 | $ | 143 | $ | 59 | $ | 40 | $ | (171 | ) | $ | 665 | ||||||||
Mark-to-market | — | — | — | — | — | — | — | — | (42 | ) | (42 | ) | ||||||||||||||||||
Project K and cost reduction activities | (199 | ) | (2 | ) | (1 | ) | (9 | ) | (211 | ) | (8 | ) | (4 | ) | (4 | ) | (9 | ) | (236 | ) | ||||||||||
Adjusted operating profit | $ | 192 | $ | 329 | $ | 167 | $ | 117 | $ | 805 | $ | 151 | $ | 63 | $ | 44 | $ | (120 | ) | $ | 943 | |||||||||
Year-to-date period ended September 30, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast operating profit | $ | 6 | $ | 459 | $ | 242 | $ | 173 | $ | 880 | $ | 214 | $ | 82 | $ | 64 | $ | (242 | ) | $ | 998 | |||||||||
Mark-to-market | — | — | — | — | — | — | — | — | (63 | ) | (63 | ) | ||||||||||||||||||
Project K and cost reduction activities | (305 | ) | (16 | ) | (1 | ) | (13 | ) | (335 | ) | (21 | ) | (6 | ) | (5 | ) | (5 | ) | (372 | ) | ||||||||||
Adjusted operating profit | $ | 311 | $ | 475 | $ | 243 | $ | 186 | $ | 1,215 | $ | 235 | $ | 88 | $ | 69 | $ | (174 | ) | $ | 1,433 | |||||||||
Year-to-date period ended December 30, 2017 | ||||||||||||||||||||||||||||||
(millions) | U.S. Snacks | U.S. Morning Foods | U.S. Specialty | North America Other | Total North America | Europe | Latin America | Asia Pacific | Corporate | Kellogg Consolidated | ||||||||||||||||||||
Recast operating profit | $ | 138 | $ | 567 | $ | 312 | $ | 229 | $ | 1,246 | $ | 276 | $ | 108 | $ | 84 | $ | (327 | ) | $ | 1,387 | |||||||||
Mark-to-market | — | — | — | — | — | — | — | — | (81 | ) | (81 | ) | ||||||||||||||||||
Project K and cost reduction activities | (309 | ) | (18 | ) | (2 | ) | (16 | ) | (345 | ) | (40 | ) | (8 | ) | (11 | ) | (7 | ) | (411 | ) | ||||||||||
Adjusted operating profit | $ | 447 | $ | 585 | $ | 314 | $ | 245 | $ | 1,591 | $ | 316 | $ | 116 | $ | 95 | $ | (239 | ) | $ | 1,879 |
Year-to-date period ended April 1, 2017 | Year-to-date period ended July 1, 2017 | Year-to-date period ended September 30, 2017 | Year-to-date period ended December 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||
(millions) | Previously Reported | Revenue Recognition | Cash Flow ASU | Recast | Previously Reported | Revenue Recognition | Cash Flow ASU | Recast | Previously Reported | Revenue Recognition | Cash Flow ASU | Recast | Previously Reported | Revenue Recognition | Cash Flow ASU | Recast | ||||||||||||||||||||||||||||||||
Net income | $ | 262 | $ | 4 | $ | — | $ | 266 | $ | 544 | $ | 5 | $ | — | $ | 549 | $ | 841 | $ | (4 | ) | $ | — | $ | 837 | $ | 1,269 | $ | (15 | ) | $ | — | $ | 1,254 | ||||||||||||||
Net cash provided by (used in) operating activities | 211 | — | (245 | ) | (34 | ) | 654 | — | (562 | ) | 92 | 1,121 | — | (931 | ) | 190 | 1,646 | — | (1,243 | ) | 403 | |||||||||||||||||||||||||||
Net cash provided by (used in) investing activities | (131 | ) | — | 245 | 114 | (262 | ) | — | 562 | 300 | (363 | ) | — | 931 | 568 | (1,094 | ) | — | 1,243 | 149 | ||||||||||||||||||||||||||||
Net cash provided by (used in) financing activities | (77 | ) | — | — | (77 | ) | (372 | ) | — | — | (372 | ) | (815 | ) | — | — | (815 | ) | (604 | ) | — | — | (604 | ) | ||||||||||||||||||||||||
Supplemental financial data: | ||||||||||||||||||||||||||||||||||||||||||||||||
Net cash provided by (used in) operating activities | $ | 211 | $ | — | $ | (245 | ) | $ | (34 | ) | $ | 654 | $ | — | $ | (562 | ) | $ | 92 | $ | 1,121 | $ | — | $ | (931 | ) | $ | 190 | $ | 1,646 | $ | — | $ | (1,243 | ) | $ | 403 | |||||||||||
Additions to properties | (130 | ) | — | — | (130 | ) | (268 | ) | — | — | (268 | ) | (374 | ) | — | — | (374 | ) | (501 | ) | — | — | (501 | ) | ||||||||||||||||||||||||
Cash Flow (operating cash flow less property additions) | $ | 81 | $ | — | $ | (245 | ) | $ | (164 | ) | $ | 386 | $ | — | $ | (562 | ) | $ | (176 | ) | $ | 747 | $ | — | $ | (931 | ) | $ | (184 | ) | $ | 1,145 | $ | — | $ | (1,243 | ) | $ | (98 | ) |