Reportable Segments

9 Months Ended

Jan. 31, 2021

We operate in one industry: the manufacturing and marketing of food and beverage products. We have three reportable segments: U.S. Retail Pet Foods, U.S. Retail Coffee, and U.S. Retail Consumer Foods. Effective during the first quarter of 2021, the presentation of International and Away From Home represents a combination of all other operating segments that are not individually reportable. As a result of leadership changes, these operating segments are being managed and reported separately and no longer represent a reportable segment for segment reporting purposes. Prior year segment results have not been modified, as the combination of these operating segments represents the previously reported International and Away From Home reportable segment.

The U.S. Retail Pet Foods segment primarily includes the domestic sales of Rachael Ray® Nutrish®, Meow Mix®, Milk-Bone®, 9Lives®, Kibbles ’n Bits®, Pup-Peroni®, and Nature’s Recipe® branded products; the U.S. Retail Coffee segment primarily includes the domestic sales of Folgers®, Dunkin’TM, and Café Bustelo® branded coffee; and the U.S. Retail Consumer Foods segment primarily includes the domestic sales of Smucker’s® and Jif® branded products. International and Away From Home includes the sale of products distributed domestically and in foreign countries through retail channels and foodservice distributors and operators (e.g., health care operators, restaurants, lodging, hospitality, offices, K-12, colleges and universities, and convenience stores).

Segment profit represents net sales, less direct and allocable operating expenses, and is consistent with the way in which we manage our segments. However, we do not represent that the segments, if operated independently, would report operating profit equal to the segment profit set forth below, as segment profit excludes certain expenses such as corporate administrative expenses, gains and losses related to the sale of a business, unallocated gains and losses on commodity and foreign currency exchange derivative activities (“unallocated derivative gains and losses”), as well as amortization expense and impairment charges related to intangible assets.

Commodity and foreign currency exchange derivative gains and losses are reported in unallocated derivative gains and losses outside of segment operating results until the related inventory is sold. At that time, we reclassify the hedge gains and losses from unallocated derivative gains and losses to segment profit, allowing our segments to realize the economic effect of the hedge without experiencing any mark-to-market volatility. We would expect that any gain or loss in the estimated fair value of the derivatives would generally be offset by a change in the estimated fair value of the underlying exposures.


	Three Months Ended January 31,				Nine Months Ended January 31,
	2021		2020		2021		2020
Net sales:
U.S. Retail Pet Foods	$	768.6	$	721.9	$	2,169.9	$	2,101.7
U.S. Retail Coffee	625.9		558.8		1,791.5		1,567.9
U.S. Retail Consumer Foods	447.6		422.9		1,415.9		1,251.2
International and Away From Home	234.6		268.7		705.2		788.2
Total net sales	$	2,076.7	$	1,972.3	$	6,082.5	$	5,709.0
Segment profit:
U.S. Retail Pet Foods	$	135.1	$	146.0	$	385.3	$	403.1
U.S. Retail Coffee	210.7		189.5		595.4		500.9
U.S. Retail Consumer Foods	110.9		84.2		377.7		256.6
International and Away From Home	24.5		49.0		94.9		131.7
Total segment profit	$	481.2	$	468.7	$	1,453.3	$	1,292.3
Amortization	(57.0)		(58.8)		(176.1)		(176.4)

Other intangible assets impairment charge	—		(52.4)		—		(52.4)
Gain on divestitures – net	27.2		—		27.2		—
Interest expense – net	(43.5)		(45.1)		(134.7)		(143.6)
Unallocated derivative gains (losses)	33.8		7.7		81.5		37.6
Other special project costs (A)	(1.7)		(3.3)		(1.7)		(9.9)
Corporate administrative expenses	(77.3)		(72.9)		(236.1)		(214.8)
Other income (expense) – net	(1.2)		(1.4)		(34.8)		(4.5)
Income before income taxes	$	361.5	$	242.5	$	978.6	$	728.3

(A)Other special project costs includes integration and restructuring costs. For more information, see Note 3: Integration and Restructuring Costs.

The following table presents certain geographical information.


	Three Months Ended January 31,				Nine Months Ended January 31,
	2021		2020		2021		2020
Net sales:
United States	$	1,939.5	$	1,837.6	$	5,651.4	$	5,311.1
International:
Canada	$	113.9	$	108.7	$	345.3	$	318.9
All other international	23.3		26.0		85.8		79.0
Total international	$	137.2	$	134.7	$	431.1	$	397.9
Total net sales	$	2,076.7	$	1,972.3	$	6,082.5	$	5,709.0

The following table presents product category information.


	Three Months Ended January 31,				Nine Months Ended January 31,
	2021		2020		2021		2020		Primary Reportable Segment (A)
Coffee	$	693.7	$	650.7	$	1,989.0	$	1,824.5	U.S. Retail Coffee
Dog food	296.5		300.8		852.0		899.0		U.S. Retail Pet Foods
Cat food	245.2		223.9		697.1		633.6		U.S. Retail Pet Foods
Pet snacks	246.6		214.6		676.1		617.8		U.S. Retail Pet Foods
Peanut butter	208.5		180.0		601.2		533.3		U.S. Retail Consumer Foods
Frozen handheld	100.0		82.6		301.8		247.5		U.S. Retail Consumer Foods
Fruit spreads	99.8		88.3		293.3		264.0		U.S. Retail Consumer Foods
Shortening and oils	33.9		68.9		193.9		192.2		U.S. Retail Consumer Foods
Juices and beverages	33.5		30.4		103.8		94.0		U.S. Retail Consumer Foods
Portion control	27.9		42.0		83.0		123.9		Other (B)
Baking mixes and ingredients	21.5		19.6		74.7		59.3		Other (B)
Other	69.6		70.5		216.6		219.9		Other (B)
Total net sales	$	2,076.7	$	1,972.3	$	6,082.5	$	5,709.0

(A)The identified primary reportable segment generally represents at least 75 percent of total net sales for each respective product category.

(B)Represents the combined International and Away From Home operating segments.