Reportable Segments

3 Months Ended

Jul. 31, 2015

Segment Reporting [Abstract]

Reportable Segments

Note 4: Reportable Segments

We operate in one industry: the manufacturing and marketing of food products. Effective May 1, 2015, our reportable segments were modified to align with the way performance is currently evaluated by our segment management and chief operating decision maker, our Chief Executive Officer, and the way in which we currently report information internally. We now have three reportable segments: U.S. Retail Coffee, U.S. Retail Consumer Foods, and U.S. Retail Pet Foods. Within our segment results, we also present International and Foodservice, which is a combination of the strategic business areas not included in the U.S. retail market segments. The U.S. Retail Consumer Foods segment is a combination of the former U.S. Retail Consumer Foods segment and the Natural Foods strategic business area, previously included in the former International, Foodservice, and Natural Foods segment. Prior year segment results have been modified to reflect the realignment of our segments.

The U.S. Retail Coffee segment primarily includes the domestic sales of Folgers^® and Dunkin’ Donuts^® branded coffee; the U.S. Retail Consumer Foods segment primarily includes domestic sales of Jif^®, Smucker’s^®, Pillsbury^®, and Crisco^® branded products; and the U.S. Retail Pet Foods segment primarily includes domestic sales of Meow Mix^®, Milk-Bone^®, Kibbles ’n Bits^®, Natural Balance^®, 9Lives^®, Pup-Peroni^®, Gravy Train^®, and Nature’s Recipe^® branded products. International and Foodservice is comprised of products distributed domestically and in foreign countries through retail channels and foodservice distributors and operators (e.g., restaurants, lodging, schools and universities, health care operators).

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 operating expenses such as corporate administrative expenses and unallocated gains and

losses on commodity and foreign currency exchange derivative activities. 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
	July 31,
	2015		2014
Net sales:
U.S. Retail Coffee	$	565.0	$	502.7
U.S. Retail Consumer Foods		582.2		582.4
U.S. Retail Pet Foods		549.9		—
International and Foodservice		254.9		238.7
Total net sales	$	1,952.0	$	1,323.8
Segment profit:
U.S. Retail Coffee	$	155.1	$	137.6
U.S. Retail Consumer Foods		117.5		118.1
U.S. Retail Pet Foods		90.0		—
International and Foodservice		30.5		30.5
Total segment profit	$	393.1	$	286.2
Interest expense – net		(44.4)		(17.4)
Unallocated derivative losses		(10.0)		(21.4)
Cost of products sold – special project costs		(3.1)		(0.4)
Other special project costs		(22.9)		(8.6)
Corporate administrative expenses		(90.0)		(64.2)
Other income - net		0.1		1.3
Income before income taxes	$	222.8	$	175.5