Note 15: Guarantor and Non-Guarantor Financial Information

Our 3.50 percent Senior Notes due October 15, 2021, are fully and unconditionally guaranteed, on a joint and several basis, by J.M. Smucker LLC and The Folgers Coffee Company (the “subsidiary guarantors”), which are 100 percent wholly-owned subsidiaries of the Company. A subsidiary guarantor will be released from its obligations under the indenture governing the notes (a) if we exercise our legal or covenant defeasance option or if our obligations under the indenture are discharged in accordance with the terms of the indenture or (b) upon delivery of an officer’s certificate to the trustee that the subsidiary guarantor does not guarantee our obligations under any of our other primary senior indebtedness and that any other guarantees of such primary senior indebtedness of the subsidiary guarantor have been released other than through discharges as a result of payment by such guarantor on such guarantees.

Condensed consolidating financial statements for the Company, the subsidiary guarantors, and the other subsidiaries of the Company that are not guaranteeing the indebtedness under the 3.50 percent Senior Notes (the “non-guarantor subsidiaries”) are provided below. The principal elimination entries relate to investments in subsidiaries and intercompany balances and transactions, including transactions with our 100 percent wholly-owned subsidiary guarantors and non-guarantor subsidiaries. We have accounted for investments in subsidiaries using the equity method.

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME


	Three Months Ended October 31, 2014
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Net sales	$	804.6	$	346.4	$	1,785.6	$	(1,454.8)	$	1,481.8
Cost of products sold		650.0		313.4		1,444.6		(1,462.7)		945.3

Gross Profit		154.6		33.0		341.0		7.9		536.5
Selling, distribution, and administrative expenses and other special project costs		50.5		14.0		190.7		—		255.2
Amortization		1.1		—		24.1		—		25.2
Other operating (income) expense – net		(0.3)		1.5		0.1		—		1.3

Operating Income		103.3		17.5		126.1		7.9		254.8
Interest (expense) income – net		(16.4)		0.3		(0.1)		—		(16.2)
Other income – net		0.2		—		0.1		—		0.3
Equity in net earnings of subsidiaries		104.3		35.6		17.5		(157.4)		—

Income Before Income Taxes		191.4		53.4		143.6		(149.5)		238.9
Income taxes		33.1		0.1		47.4		—		80.6

Net Income	$	158.3	$	53.3	$	96.2	$	(149.5)	$	158.3
Other comprehensive (loss) income, net of tax		(17.3)		(6.8)		(18.8)		25.6		(17.3)

Comprehensive Income	$	141.0	$	46.5	$	77.4	$	(123.9)	$	141.0

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME


	Three Months Ended October 31, 2013
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Net sales	$	852.6	$	377.5	$	1,855.2	$	(1,525.4)	$	1,559.9
Cost of products sold		692.6		345.8		1,487.0		(1,518.1)		1,007.3

Gross Profit		160.0		31.7		368.2		(7.3)		552.6
Selling, distribution, and administrative expenses and other special project costs		55.4		12.4		209.4		—		277.2
Amortization		1.0		—		23.7		—		24.7
Other operating expense (income) – net		0.1		0.3		(0.5)		—		(0.1)

Operating Income		103.5		19.0		135.6		(7.3)		250.8
Interest (expense) income – net		(20.4)		0.3		(0.4)		—		(20.5)
Other expense – net		—		(0.3)		—		—		(0.3)
Equity in net earnings of subsidiaries		95.5		39.3		18.7		(153.5)		—

Income Before Income Taxes		178.6		58.3		153.9		(160.8)		230.0
Income taxes		25.2		0.1		51.3		—		76.6

Net Income	$	153.4	$	58.2	$	102.6	$	(160.8)	$	153.4
Other comprehensive (loss) income, net of tax		(3.7)		3.2		(4.6)		1.4		(3.7)

Comprehensive Income	$	149.7	$	61.4	$	98.0	$	(159.4)	$	149.7

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME


	Six Months Ended October 31, 2014
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Net sales	$	1,511.7	$	636.8	$	3,303.4	$	(2,646.3)	$	2,805.6
Cost of products sold		1,232.8		576.6		2,625.8		(2,644.8)		1,790.4

Gross Profit		278.9		60.2		677.6		(1.5)		1,015.2
Selling, distribution, and administrative expenses and other special project costs		103.3		26.2		387.7		—		517.2
Amortization		2.1		—		48.0		—		50.1
Other operating (income) expense – net		(0.3)		1.9		(0.1		—		1.5

Operating Income		173.8		32.1		242.0		(1.5)		446.4
Interest (expense) income – net		(34.0)		0.6		(0.2)		—		(33.6)
Other income – net		1.5		—		0.1		—		1.6
Equity in net earnings of subsidiaries		181.8		74.4		32.1		(288.3)		—

Income Before Income Taxes		323.1		107.1		274.0		(289.8)		414.4
Income taxes		48.8		0.2		91.1		—		140.1

Net Income	$	274.3	$	106.9	$	182.9	$	(289.8)	$	274.3
Other comprehensive (loss) income, net of tax		(22.6)		(10.8)		(25.8)		36.6		(22.6)

Comprehensive Income	$	251.7	$	96.1	$	157.1	$	(253.2)	$	251.7

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME


	Six Months Ended October 31, 2013
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Net sales	$	1,588.6	$	680.9	$	3,448.6	$	(2,807.3)	$	2,910.8
Cost of products sold		1,293.0		623.2		2,744.9		(2,795.8)		1,865.3

Gross Profit		295.6		57.7		703.7		(11.5)		1,045.5
Selling, distribution, and administrative expenses and other special project costs		104.0		23.3		405.9		—		533.2
Amortization		2.1		—		47.1		—		49.2
Other operating (income) expense – net		(1.4)		0.1		0.3		—		(1.0)

Operating Income		190.9		34.3		250.4		(11.5)		464.1
Interest (expense) income – net		(44.4)		0.6		(0.5)		—		(44.3)
Other expense – net		—		(0.2)		(0.1)		—		(0.3)
Equity in net earnings of subsidiaries		178.1		72.2		34.1		(284.4)		—

Income Before Income Taxes		324.6		106.9		283.9		(295.9)		419.5
Income taxes		44.6		0.2		94.7		—		139.5

Net Income	$	280.0	$	106.7	$	189.2	$	(295.9)	$	280.0
Other comprehensive (loss) income, net of tax		(6.4)		5.1		(8.5)		3.4		(6.4)

Comprehensive Income	$	273.6	$	111.8	$	180.7	$	(292.5)	$	273.6

CONDENSED CONSOLIDATING BALANCE SHEETS


	October 31, 2014
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
ASSETS
Current Assets
Cash and cash equivalents		10.5		—		94.8		—		105.3
Inventories		—		170.8		895.9		(1.5)		1,065.2
Other current assets		473.7		6.9		94.5		(19.8)		555.3

Total Current Assets		484.2		177.7		1,085.2		(21.3)		1,725.8
Property, Plant, and Equipment – Net		242.5		567.0		495.5		—		1,305.0
Investments in Subsidiaries		8,607.0		4,127.7		254.5		(12,989.2)		—
Intercompany Receivable		—		320.6		1,165.7		(1,486.3)		—
Other Noncurrent Assets
Goodwill		1,082.0		—		2,060.6		—		3,142.6
Other intangible assets – net		503.3		—		2,500.4		—		3,003.7
Other noncurrent assets		81.8		10.8		65.1		—		157.7

Total Other Noncurrent Assets		1,667.1		10.8		4,626.1		—		6,304.0

Total Assets		11,000.8		5,203.8		7,627.0		(14,496.8)		9,334.8

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities		756.5		87.3		180.1		(19.8)		1,004.1
Noncurrent Liabilities
Long-term debt		1,890.8		—		—		—		1,890.8
Deferred income taxes		109.4		—		918.8		—		1,028.2
Intercompany payable		2,858.6		—		—		(2,858.6)		—
Other noncurrent liabilities		220.5		12.8		13.4		—		246.7

Total Noncurrent Liabilities		5,079.3		12.8		932.2		(2,858.6)		3,165.7

Total Liabilities		5,835.8		100.1		1,112.3		(2,878.4)		4,169.8

Total Shareholders’ Equity		5,165.0		5,103.7		6,514.7		(11,618.4)		5,165.0

Total Liabilities and Shareholders’ Equity		11,000.8		5,203.8		7,627.0		(14,496.8)		9,334.8

CONDENSED CONSOLIDATING BALANCE SHEETS


	April 30, 2014
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
ASSETS
Current Assets
Cash and cash equivalents	$	6.8	$	—	$	146.7	$	—	$	153.5
Inventories		—		173.3		761.4		(3.7)		931.0
Other current assets		360.2		9.9		94.6		(10.1)		454.6

Total Current Assets		367.0		183.2		1,002.7		(13.8)		1,539.1
Property, Plant, and Equipment – Net		233.6		551.1		480.9		—		1,265.6
Investments in Subsidiaries		8,367.6		4,063.3		237.9		(12,668.8)		—
Intercompany Receivable		—		315.5		1,132.2		(1,447.7)		—
Other Noncurrent Assets
Goodwill		1,082.0		—		2,016.2		—		3,098.2
Other intangible assets – net		505.5		—		2,518.8		—		3,024.3
Other noncurrent assets		70.4		11.1		63.4		—		144.9

Total Other Noncurrent Assets		1,657.9		11.1		4,598.4		—		6,267.4

Total Assets	$	10,626.1	$	5,124.2	$	7,452.1	$	(14,130.3)	$	9,072.1

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities	$	595.9	$	103.8	$	201.4	$	(10.1)	$	891.0
Noncurrent Liabilities
Long-term debt		1,879.8		—		—		—		1,879.8
Deferred income taxes		107.6		—		913.1		—		1,020.7
Intercompany payable		2,792.9		—		—		(2,792.9)		—
Other noncurrent liabilities		220.3		12.8		17.9		—		251.0

Total Noncurrent Liabilities		5,000.6		12.8		931.0		(2,792.9)		3,151.5

Total Liabilities		5,596.5		116.6		1,132.4		(2,803.0)		4,042.5

Total Shareholders’ Equity		5,029.6		5,007.6		6,319.7		(11,327.3)		5,029.6

Total Liabilities and Shareholders’ Equity	$	10,626.1	$	5,124.2	$	7,452.1	$	(14,130.3)	$	9,072.1

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS


	Six Months Ended October 31, 2014
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Net Cash (Used for) Provided by Operating Activities	$	(26.1)	$	51.7	$	58.3	$	—	$	83.9

Investing Activities
Businesses acquired, net of cash acquired		—		—		(80.3)		—		(80.3)
Additions to property, plant, and equipment		(24.2)		(44.3)		(45.2)		—		(113.7)
Equity investments in subsidiaries		(83.3)		—		—		83.3		—
Proceeds from disposal of property, plant, and equipment		—		1.1		0.1		—		1.2
(Disbursements of) repayments from intercompany loans		—		(5.1)		(60.5)		65.6		—
Other – net		—		(3.4)		2.1		—		(1.3)

Net Cash (Used for) Provided by Investing Activities		(107.5)		(51.7)		(183.8)		148.9		(194.1)

Financing Activities
Revolving credit facility – net		297.5		—		—		—		297.5
Repayments of long-term debt		(100.0)		—		—		—		(100.0)
Quarterly dividends paid		(123.9)		—		—		—		(123.9)
Purchase of treasury shares		(11.3)		—		—		—		(11.3)
Proceeds from stock option exercises		0.8		—		—		—		0.8
Investments in subsidiaries		—		—		83.3		(83.3)		—
Intercompany payable		65.6		—		—		(65.6)		—
Other – net		8.6		—		—		—		8.6

Net Cash Provided by (Used for) Financing Activities		137.3		—		83.3		(148.9)		71.7
Effect of exchange rate changes on cash		—		—		(9.7)		—		(9.7)

Net increase (decrease) in cash and cash equivalents		3.7		—		(51.9)		—		(48.2)
Cash and cash equivalents at beginning of period		6.8		—		146.7		—		153.5

Cash and Cash Equivalents at End of Period	$	10.5	$	—	$	94.8		—	$	105.3

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS


	Six Months Ended October 31, 2013
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Net Cash (Used for) Provided by Operating Activities	$	(79.4)	$	(14.3)	$	261.7	$	—	$	168.0

Investing Activities
Businesses acquired, net of cash acquired		—		—		(102.0)		—		(102.0)
Additions to property, plant, and equipment		(12.0)		(45.5)		(25.9)		—		(83.4)
Equity investments in subsidiaries		(102.0)		—		—		102.0		—
Proceeds from disposal of property, plant, and equipment		—		0.4		1.0		—		1.4
Repayments from (disbursements of) intercompany loans		—		59.7		(221.9)		162.2		—
Other – net		(3.1)		(0.3)		(5.5)		—		(8.9)

Net Cash (Used for) Provided by Investing Activities		(117.1)		14.3		(354.3)		264.2		(192.9)

Financing Activities
Revolving credit facility - net		207.0		—		—		—		207.0
Quarterly dividends paid		(116.4)		—		—		—		(116.4)
Purchase of treasury shares		(165.5)		—		—		—		(165.5)
Proceeds from stock option exercises		0.3		—		—		—		0.3
Investments in subsidiaries		—		—		102.0		(102.0)		—
Intercompany payable		162.2		—		—		(162.2)		—
Other – net		6.4		—		(7.7)		—		(1.3)

Net Cash Provided by (Used for) Financing Activities		94.0		—		94.3		(264.2)		(75.9)
Effect of exchange rate changes		—		—		(5.1)		—		(5.1)

Net decrease in cash and cash equivalents		(102.5)		—		(3.4)		—		(105.9
Cash and cash equivalents at beginning of period		108.0		—		148.4		—		256.4

Cash and Cash Equivalents at End of Period	$	5.5	$	—	$	145.0	$	—	$	150.5