[January 26, 2017] |
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Mead Johnson Nutrition Reports Fourth Quarter and Full Year 2016 Results; Provides 2017 Guidance
Mead Johnson Nutrition Company (NYSE: MJN) today announced its financial
results for the quarter and year ended December 31, 2016.
Highlights are as follows:
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Fourth quarter gross sales were 3% below the prior year quarter on a
reported basis and in-line with the prior year quarter on a constant
dollar(1) basis. Net sales were 7% below the prior year
quarter on a reported basis and 3% below the prior year quarter on a
constant dollar basis. The difference between gross sales and net
sales growth rates reflects increases in ongoing trade investments.
-
Full year 2016 net sales were 8% below the prior year on a reported
basis and 3% below the prior year on a constant dollar basis.
Excluding the impact of Venezuela, net sales for 2016 were 2% below
the prior year on a constant dollar basis.
-
Selling, general and administrative expenses decreased 19% in the
fourth quarter compared to the prior year quarter as a result of the
company's Fuel for Growth program. The program delivered savings of
approximately $90 million in 2016, above the high end of the expected
range. Total cost savings to date are $110 million, with approximately
$180 million expected by the end of 2018.
-
Earnings before Interest and Income Taxes (EBIT) was 15% higher in the
fourth quarter compared to the prior year quarter. Excluding Specified
Items and the impact of foreign exchange, non-GAAP EBIT was 4% above
the prior year quarter.
-
Earnings per Share (EPS) for the fourth quarter was $0.91. Excluding
Specified Items, non-GAAP EPS for the fourth quarter was $0.78. EPS
for 2016 was $2.92. Excluding Specified Items, non-GAAP EPS was $3.40
for the full year.
-
For 2017, the company expects full year net sales to be in the range
of -3% to 0% compared to 2016 on a reported basis, and in the range of
-1% to +2% compared to 2016 on a constant dollar basis. Based upon
recent spot rates, the estimated adverse foreign exchange impact is
approximately 2%. Sales on a reported basis will be impacted by future
foreign exchange changes which cannot be estimated.
-
The company expects 2017 GAAP EPS to be in the range of $3.05 to
$3.20. GAAP EPS guidance includes estimated adverse foreign exchange
impacts of approximately $0.20, based on recent spot rates. GAAP EPS
will be impacted by future foreign exchange changes and potentially
significant future specified mark-to-market pension adjustments which
cannot be estimated. Specified Items such as charges related to Fuel
for Growth and other items are estimated to be $0.10 in 2017. The
company expects non-GAAP EPS of $3.35 to $3.50 on a constant dollar
basis.
"In the fourth quarter we continued to make progress with a series of
important strategic transitions in key markets. Our imported products
again grew strongly in China - and we doubled our sales volume via
e-commerce out of Hong Kong over the prior quarter. Though it will take
some time for us to complete the transition phase we are currently in,
we are encouraged by early signs our plans are working," said Kasper
Jakobsen, Chief Executive Officer.
(1) Constant dollar figures exclude the impact of changes
in foreign currency exchange rates and are reconciled in the tables in
the body of this earnings release and in the schedules titled
"Reconciliation of non-GAAP to GAAP Results." Non-GAAP results exclude
Specified Items. For a description of Specified Items and a
reconciliation of non-GAAP to GAAP, see the schedules titled
"Reconciliation of non-GAAP to GAAP Results."
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Fourth Quarter 2016
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(Dollars in Millions)
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(UNAUDITED)
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Three Months Ended December 31,
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% Change
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% Change Due to
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% of
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% of
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Constant
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Foreign
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Net Sales
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2016
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Total
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2015
|
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Total
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Reported
|
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Dollar
|
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Volume
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Price/Mix
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Exchange
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Asia
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$436.9
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48%
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$468.0
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48%
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(7)%
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(4)%
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(5)%
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1%
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(3)%
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Latin America
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156.3
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17%
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169.8
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18%
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(8)%
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4%
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(6)%
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10%
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(12)%
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North America/Europe
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308.4
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35%
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329.2
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34%
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(6)%
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(5)%
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(8)%
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3%
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(1)%
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Net Sales
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$901.6
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100%
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$967.0
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100%
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(7)%
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(3)%
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(6)%
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3%
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(4)%
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-
In Asia, fourth quarter sales were 7% below the prior year quarter on
a reported basis. Sales were negatively impacted by adverse foreign
exchange, mainly in China. On a constant dollar basis, sales were 4%
below the prior year quarter. We continued to experience strong sales
growth from our new product offerings in China, which was more than
offset by reduced visitor numbers and channel transformation towards
an e-commerce model in Hong Kong and reduced demand for locally
manufactured products. Market share weakness and retail inventory
related adjustments continued to negatively impact our sales in the
Philippines.
-
In Latin America, fourth quarter sales were 8% below the prior year
quarter on a reported basis. Sales were negatively impacted by adverse
foreign exchange, primarily in Argentina and Mexico. On a constant
dollar basis, net sales were 4% above the prior year quarter. Price
increases across the segment more than offset lower volume and
suspended shipments into Venezuela. Excluding the impact of suspended
shipments into Venezuela, constant dollar sales increased by 8%.
-
In North America/Europe, fourth quarter sales were 6% below the prior
year quarter on a reported basis and were 5% below on a constant
dollar basis. Sales in the U.S. were negatively impacted by market
share weakness. In Canada, the company's market share position
continued to strengthen. In Europe, we continued to experience strong
performance in our specialty and solutions offering.
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% Change
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Three Months Ended December 31,
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% Change
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Due to
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% of
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% of
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Constant
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Foreign
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Earnings Before Interest and Income Taxes (EBIT)
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2016
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Sales
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2015
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Sales
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Reported
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Dollar
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Exchange
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Asia
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$118.6
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27%
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$139.9
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30%
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(15)%
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(7)%
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(8)%
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Latin America
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39.6
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25%
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34.2
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20%
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16%
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33%
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(17)%
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North America/Europe
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92.0
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30%
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96.9
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29%
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(5)%
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(1)%
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(4)%
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Corporate and Other (a)
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(24.2)
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(75.2)
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68%
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GAAP EBIT
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226.0
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25%
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195.8
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20%
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15%
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25%
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(10)%
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Non-GAAP EBIT
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$208.1
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$219.6
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(5)%
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4%
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(9)%
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(a) All Specified Items are included in
Corporate and Other.
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-
Fourth quarter EBIT was 15% above the prior year quarter on a reported
basis. Excluding pension remeasurement and Fuel for Growth related
charges, non-GAAP EBIT on a constant dollar basis was 4% above the
prior year quarter. Gross margin percentage was slightly below the
prior year quarter primarily due to increased promotional activities.
Fuel for Growth resulted in approximately $18 million in lower
operating expenses in 2016 compared to the prior year quarter.
-
In Asia, fourth quarter EBIT decreased 15% on a reported basis and 7%
on a constant dollar basis when compared to the prior year quarter.
The decrease in EBIT was primarily due to the Company's strategic
investments in the reshaping of our product portfolio and channel mix
in China and Hong Kong, and the adverse market dynamics in the
Philippines referenced above.
-
In Latin America, fourth quarter EBIT increased 16% on a reported
basis and 33% on a constant dollar basis when compared to the prior
year quarter. The improvement seen was despite adverse foreign
exchange impacts, primarily the depreciation of the Mexican Peso. EBIT
benefited from higher sales on a constant dollar basis and lower dairy
costs.
-
In North America/Europe, fourth quarter EBIT decreased 5% on a
reported basis and 1% on a constant dollar basis compared to the prior
year quarter. Improved gross margin from lower dairy costs, reduced
operating expenses and lower incentive based compensation partially
offset lower sales.
-
Corporate and Other expenses for the fourth quarter were 68% lower
than the prior year quarter on a reported basis. Excluding the impact
of Specified Items, Corporate and Other expenses were 18% below the
prior year due to savings from the company's Fuel for Growth program.
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Full Year 2016
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(Dollars in Millions)
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(UNAUDITED)
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|
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Year Ended December 31,
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% Change
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% Change Due to
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% of
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% of
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Constant
|
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Foreign
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Net Sales
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2016
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Total
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2015
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Total
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Reported
|
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Dollar
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Volume
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Price/Mix
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Exchange
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Asia
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$
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1,856.9
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50%
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$
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2,039.0
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50%
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(9)%
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(5)%
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(6)%
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1%
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(4)%
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Latin America
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643.7
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17%
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757.1
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19%
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(15)%
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(1)%
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(10)%
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9%
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(14)%
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North America/Europe
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1,242.1
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33%
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1,275.2
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31%
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(3)%
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(2)%
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(4)%
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2%
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(1)%
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Net Sales
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$
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3,742.7
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100%
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$
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4,071.3
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100%
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(8)%
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(3)%
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(6)%
|
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3%
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(5)%
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|
|
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|
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-
In Asia, full year sales were 9% below the prior year on a reported
basis. Sales were negatively impacted by adverse foreign exchange,
most notably in China. Sales were 5% below prior year on a constant
dollar basis. Growth in mainland China was driven by new product
offerings, reflecting a rapid change in consumer preferences toward
imported premium products. China's results were impacted by reduced
visitor numbers and channel transformation towards an e-commerce model
in Hong Kong. In addition, continued adverse market dynamics and
retail inventory related adjustments negatively impacted our results
in the Philippines.
-
In Latin America, full year sales were 15% below the prior year on a
reported basis. On a constant dollar basis, net sales were 1% below.
Excluding the impact of reduced shipments to Venezuela, constant
dollar sales increased 6%. The segment was negatively impacted by
adverse foreign exchange, mainly in Mexico and Argentina. Price
increases taken mainly in 2016 in key markets offset a substantial
portion of the adverse foreign exchange impact across the segment.
-
In North America/Europe, full year sales decreased 3% on a reported
basis and 2% on a constant dollar basis compared to the prior year. In
the U.S., the company experienced market share weakness, which was
partially offset by strong growth and market share gains in both
infant and children's products in Canada and strong performance in
Europe.
|
|
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|
|
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% Change
|
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|
Year Ended December 31,
|
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% Change
|
|
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Due to
|
|
|
|
|
|
% of
|
|
|
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% of
|
|
|
|
|
Constant
|
|
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Foreign
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Earnings Before Interest and Income Taxes (EBIT)
|
|
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2016
|
|
Sales
|
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2015
|
|
Sales
|
|
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Reported
|
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Dollar
|
|
|
Exchange
|
Asia
|
|
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$559.3
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30%
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$682.0
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33%
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(18)%
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(12)%
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(6)%
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Latin America
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|
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156.7
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24%
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175.2
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23%
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(11)%
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10%
|
|
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(21)%
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North America/Europe
|
|
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380.3
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31%
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361.8
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28%
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5%
|
|
9%
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(4)%
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Corporate and Other (a)
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(277.6)
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(282.8)
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2%
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GAAP EBIT
|
|
|
818.7
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22%
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|
936.2
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23%
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(13)%
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(4)%
|
|
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(9)%
|
Non-GAAP EBIT
|
|
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$926.8
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$980.8
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(6)%
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3%
|
|
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(9)%
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(a) All Specified Items are included in
Corporate and Other.
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-
EBIT for 2016 declined 13% in 2016 compared to the prior year on a
reported basis. EBIT in 2016 includes $82 million of charges related
to the Venezuela business and adverse foreign exchange, partially
offset by pension gains of $7 million. Excluding the impact of
Specified Items and the impact of foreign exchange, non-GAAP EBIT
improved 3%. Reduced gross profit was more than offset by lower
operating expenses. Fuel for Growth resulted in a $90 million
reduction in operating expenses.
-
In Asia, full year EBIT decreased 18% on a reported basis and 12% on a
constant dollar basis compared to the prior year. Adverse foreign
exchange impacts were driven mainly by the Chinese Renminbi. EBIT was
further impacted by reduced gross profit from lower sales volumes and
investments to increase consumer awareness of Enfinitas, partially
offset by lower dairy costs.
-
In Latin America, full year EBIT decreased 11% on a reported basis and
increased 10% on a constant dollar basis compared to the prior year,
with the Venezuela business driving the decline in the segment. EBIT
benefited from lower dairy costs, cost savings initiatives and lower
advertising and promotion spending.
-
In North America/Europe, full year EBIT increased 5% on a reported
basis and increased 9% on a constant dollar basis compared to the
prior year. EBIT increased due to lower dairy costs, reduced
advertising and promotion expenses, lower incentive based compensation
and savings from Fuel for Growth.
-
Corporate and Other expenses for 2016 were 2% higher on a reported
basis compared to the prior year primarily due to the long-lived asset
impairment and devaluation charges related to the Venezuela business
and charges associated with the Fuel for Growth program, partially
offset by pension mark-to-market adjustments. Excluding the impact of
these Specified Items, Corporate and Other expenses were 29% lower due
primarily to cost reduction savings from Fuel for Growth.
Cash Flow Items and Liquidity
-
Cash and cash equivalents were $1,795.4 million at December 31, 2016
compared to $1,701.4 million at December 31, 2015. The company's net
debt was $1,184.7 million at December 31, 2016, consisting of debt of
$2,980.1 million less cash and cash equivalents. Cash and cash
equivalents were negatively impacted in 2016 by $49.3 million of
foreign currency devaluation, primarily in Venezuela.
-
Cash generated from operating activities was $691.6 million for 2016
compared to $909.9 million in the prior year period. The decrease in
2016 is due to lower earnings, increased prepaid taxes, and lower
levels of customer prepayments, partially offset by increases in
accounts payables and reduced pension plan contributions.
-
Cash used in investing activities included capital expenditures of
$149.0 million for 2016. This included investments in capacity
expansion for manufacturing facilities in the U.S. and Europe.
-
Cash used in financing activities was $399.6 million for 2016 compared
to $286.8 million in the prior year. The current year includes $100
million of share repurchases under the 2015 share repurchase
authorization which has $400 million remaining as of December 31,
2016. In 2015, financing activities include cash outflows of $1,437.0
million for the repurchase of approximately 16.4 million shares of
stock under the company's 2013 and 2015 share repurchase
authorizations. These purchases were funded with long-term debt of
$1.5 billion issued in 2015. Long-term debt was approximately $3.0
billion as of December 31, 2016 and 2015. Dividend payments were lower
in 2016 due to the retirement of shares repurchased primarily under an
accelerated repurchase agreement.
-
Interest expense, net, for the year ended December 31, 2016 was $105.4
million, an increase from $65.0 million in 2015 due to the incremental
interest on the long-term debt issued in November 2015, partially
offset by the impact of related interest rate swaps.
Outlook
For 2017, the company expects full year net sales to be in the range of
-3% to 0% compared to 2016 on a reported basis, and in the range of -1%
to +2% compared to 2016 on a constant dollar basis. Based upon recent
spot rates, the estimated adverse foreign exchange impact is
approximately 2%. Sales on a reported basis will be impacted by future
foreign exchange changes which cannot be estimated.
The company expects 2017 GAAP EPS to be in the range of $3.05 to $3.20.
GAAP EPS guidance includes estimated adverse foreign exchange impacts of
approximately $0.20, based on recent spot rates. GAAP EPS will be
impacted by future foreign exchange changes and potentially significant
future specified mark-to-market pension adjustments which cannot be
estimated. Specified Items such as charges related to Fuel for Growth
and other items are estimated to be $0.10 in 2017. The company expects
non-GAAP EPS of $3.35 to $3.50 on a constant dollar basis.
Kasper Jakobsen continued, "2017 will see us complete our
strategic transition program. We expect some pressure on both topline
and costs in the beginning of the year, and the impact of currency and
rising dairy costs will likely weigh on results. The impact will
be partially offset by momentum behind productivity initiatives in both
cost of goods and operating expenses. As previously stated, we expect
only very modest growth in both Sales and EPS on a constant dollar basis
- with performance strengthening through the second half of the year."
Conference Call Scheduled
Mead Johnson will host a conference call at 8:30 a.m. U.S. Central Time,
during which company executives will review the financial results for
the fourth quarter and full year 2016. The call will be broadcast with
accompanying slides over the Internet at http://investors.meadjohnson.com.
Security analysts and investors wishing to participate by telephone
should call 877-359-9508, pass code: Mead Johnson. Callers outside of
North America should call +1-224-357-2393 to be connected. A replay of
the conference call will be available through 11:00 p.m. U.S. Central
Time Sunday, March 12, 2017, by calling 855-859-2056, or outside of
North America by calling +1-404-537-3406, passcode: 37021489. The replay
will also be available at meadjohnson.com.
Forward-Looking Statements
Certain statements in this news release are forward-looking as defined
in the Private Securities Litigation Reform Act of 1995. These
forward-looking statements may be identified by the fact they use words
such as "should," "expect," "anticipate," "estimate," "target," "may,"
"project," "guidance," "intend," "plan," "believe" and other words and
terms of similar meaning and expression. Such statements are likely to
relate to, among other things, a discussion of goals, plans and
projections regarding financial position, results of operations, cash
flows, market position, product development, product approvals, sales
efforts, expenses, capital expenditures, performance or results of
current and anticipated products and the outcome of contingencies such
as legal proceedings and financial results. Forward-looking statements
can also be identified by the fact that they do not relate strictly to
historical or current facts. Such forward-looking statements are based
on current expectations that involve inherent risks, uncertainties and
assumptions that may cause actual results to differ materially from
expectations as of the date of this news release. These risks include,
but are not limited to: (1) the ability to sustain brand strength,
particularly the Enfa family of brands; (2) the effect on the company's
reputation of real or perceived quality issues; (3) the effect of
regulatory restrictions related to the company's products; (4) the
adverse effect of commodity costs; (5) increased competition from
branded, private label, store and economy-branded products; (6) the
effect of an economic downturn on consumers' purchasing behavior and
customers' ability to pay for product; (7) inventory reductions by
customers; (8) the adverse effect of changes in foreign currency
exchange rates; (9) the effect of changes in economic, political and
social conditions in the markets where we operate; (10) changing
consumer preferences; (11) the possibility of changes in the WIC
program, or participation in WIC(2); (12) legislative,
regulatory or judicial action that may adversely affect the company's
ability to advertise its products, maintain product margins, or
negatively impact the company's reputation or result in fines or
penalties that decrease earnings; and (13) the ability to develop and
market new, innovative products. For additional information regarding
these and other factors, see the company's filings with the United
States Securities and Exchange Commission (the "SEC"), including its
most recent Annual Report on Form 10-K, which filings are available upon
request from the SEC or at www.meadjohnson.com.
The company cautions readers not to place undue reliance on any
forward-looking statements, which speak only as of the date made. The
company undertakes no obligation to publicly update any forward-looking
statement, whether as a result of new information, future events or
otherwise.
About Mead Johnson
Mead Johnson, a global leader in pediatric nutrition, develops,
manufactures, markets and distributes more than 70 products in over 50
markets worldwide. The company's mission is to nourish the world's
children for the best start in life. The Mead Johnson name has been
associated with science-based pediatric nutrition products for over 100
years. The company's "Enfa" family of brands, including Enfamil®
infant formula, is the world's leading brand franchise in pediatric
nutrition. For more information, go to www.meadjohnson.com.
(2) The Special Supplemental Nutrition Program for
Women, Infants and Children (WIC) is a federal assistance program of the
Food and Nutrition Services (FNS) of the United States Department of
Agriculture (USDA).
|
MEAD JOHNSON NUTRITION COMPANY
|
CONSOLIDATED STATEMENTS OF EARNINGS
|
(Dollars and shares in millions, except per share data)
|
(UNAUDITED)
|
|
|
|
|
Three Months Ended December 31,
|
|
|
Year Ended December 31,
|
|
|
|
2016
|
|
2015
|
|
|
2016
|
|
2015
|
NET SALES
|
|
|
$
|
901.6
|
|
|
$
|
967.0
|
|
|
|
$
|
3,742.7
|
|
|
$
|
4,071.3
|
Cost of Products Sold
|
|
|
326.5
|
|
|
358.6
|
|
|
|
1,341.0
|
|
|
1,455.3
|
GROSS PROFIT
|
|
|
575.1
|
|
|
608.4
|
|
|
|
2,401.7
|
|
|
2,616.0
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
Selling, General and Administrative
|
|
|
170.9
|
|
|
211.1
|
|
|
|
766.5
|
|
|
890.6
|
Advertising and Promotion
|
|
|
146.9
|
|
|
151.1
|
|
|
|
627.0
|
|
|
641.8
|
Research and Development
|
|
|
22.5
|
|
|
28.5
|
|
|
|
97.4
|
|
|
108.4
|
Other (Income)/Expenses - net
|
|
|
8.8
|
|
|
21.9
|
|
|
|
92.1
|
|
|
39.0
|
EARNINGS BEFORE INTEREST AND INCOME TAXES
|
|
|
226.0
|
|
|
195.8
|
|
|
|
818.7
|
|
|
936.2
|
|
|
|
|
|
|
|
|
|
|
|
Interest Expense - net
|
|
|
26.5
|
|
|
22.5
|
|
|
|
105.4
|
|
|
65.0
|
EARNINGS BEFORE INCOME TAXES
|
|
|
199.5
|
|
|
173.3
|
|
|
|
713.3
|
|
|
871.2
|
|
|
|
|
|
|
|
|
|
|
|
Provision for Income Taxes
|
|
|
31.3
|
|
|
42.3
|
|
|
|
164.0
|
|
|
215.9
|
NET EARNINGS
|
|
|
168.2
|
|
|
131.0
|
|
|
|
549.3
|
|
|
655.3
|
Less: Net Earnings Attributable to Noncontrolling Interests
|
|
|
0.4
|
|
|
3.0
|
|
|
|
4.4
|
|
|
1.8
|
NET EARNINGS ATTRIBUTABLE TO SHAREHOLDERS
|
|
|
$
|
167.8
|
|
|
$
|
128.0
|
|
|
|
$
|
544.9
|
|
|
$
|
653.5
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per Share - Basic
|
|
|
|
|
|
|
|
|
|
|
Net Earnings Attributable to Shareholders
|
|
|
$
|
0.91
|
|
|
$
|
0.67
|
|
|
|
$
|
2.93
|
|
|
$
|
3.28
|
Earnings per Share - Diluted
|
|
|
|
|
|
|
|
|
|
|
Net Earnings Attributable to Shareholders
|
|
|
$
|
0.91
|
|
|
$
|
0.67
|
|
|
|
$
|
2.92
|
|
|
$
|
3.27
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average Shares - Diluted
|
|
|
184.4
|
|
|
189.8
|
|
|
|
185.8
|
|
|
199.4
|
Dividends Declared per Share
|
|
|
$
|
0.4125
|
|
|
$
|
0.4125
|
|
|
|
$
|
1.6500
|
|
|
$
|
1.6500
|
(a) The numerator for basic and diluted earnings
per share is net earnings attributable to shareholders. Net earnings has
been reduced by dividends and undistributed earnings attributable to
unvested share based incentive plan awards. The denominator for basic
earnings per share is the weighted-average shares outstanding during the
period. The denominator for diluted earnings per share is the
weighted-average shares outstanding adjusted for the effect of dilutive
stock options and performance share awards.
|
MEAD JOHNSON NUTRITION COMPANY
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(Dollars and shares in millions, except per share data)
|
(UNAUDITED)
|
|
|
|
|
December 31, 2016
|
|
|
December 31, 2015
|
ASSETS
|
|
|
|
|
|
|
CURRENT ASSETS:
|
|
|
|
|
|
|
Cash and Cash Equivalents
|
|
|
$
|
1,795.4
|
|
|
|
$
|
1,701.4
|
|
Receivables-net of allowances of $4.4 and $5.4, respectively
|
|
|
369.0
|
|
|
|
342.5
|
|
Inventories
|
|
|
473.5
|
|
|
|
484.9
|
|
Income Taxes Receivable
|
|
|
8.3
|
|
|
|
13.2
|
|
Prepaid Expenses and Other Assets
|
|
|
60.4
|
|
|
|
60.4
|
|
Total Current Assets
|
|
|
2,706.6
|
|
|
|
2,602.4
|
|
Property, Plant and Equipment-net
|
|
|
948.6
|
|
|
|
964.0
|
|
Goodwill
|
|
|
108.9
|
|
|
|
126.0
|
|
Other Intangible Assets-net
|
|
|
46.0
|
|
|
|
54.9
|
|
Deferred Income Taxes-net of valuation allowance
|
|
|
143.1
|
|
|
|
118.5
|
|
Other Assets
|
|
|
134.5
|
|
|
|
132.3
|
|
TOTAL
|
|
|
$
|
4,087.7
|
|
|
|
$
|
3,998.1
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
|
Short-term Borrowings
|
|
|
$
|
3.9
|
|
|
|
$
|
3.0
|
|
Accounts Payable
|
|
|
515.8
|
|
|
|
481.5
|
|
Dividends Payable
|
|
|
76.0
|
|
|
|
77.8
|
|
Accrued Expenses
|
|
|
194.7
|
|
|
|
213.0
|
|
Accrued Rebates and Returns
|
|
|
417.4
|
|
|
|
376.8
|
|
Deferred Income
|
|
|
12.4
|
|
|
|
35.5
|
|
Income Taxes Payable
|
|
|
24.0
|
|
|
|
65.7
|
|
Total Current Liabilities
|
|
|
1,244.2
|
|
|
|
1,253.3
|
|
Long-Term Debt
|
|
|
2,976.2
|
|
|
|
2,981.0
|
|
Deferred Income Taxes
|
|
|
6.2
|
|
|
|
8.7
|
|
Pension and Other Post employment Liabilities
|
|
|
104.2
|
|
|
|
132.4
|
|
Other Liabilities
|
|
|
229.0
|
|
|
|
215.2
|
|
Total Liabilities
|
|
|
4,559.8
|
|
|
|
4,590.6
|
|
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
|
Shareholders' Equity
|
|
|
|
|
|
|
Common Stock, $0.01 par value: 3,000 authorized, 188.3 and 191.4
issued, respectively
|
|
|
1.9
|
|
|
|
1.9
|
|
Additional Paid-in/(Distributed) Capital
|
|
|
(514.0
|
)
|
|
|
(564.2
|
)
|
Retained Earnings
|
|
|
873.8
|
|
|
|
640.4
|
|
Treasury Stock-at cost
|
|
|
(463.0
|
)
|
|
|
(362.6
|
)
|
Accumulated Other Comprehensive Income/(Loss)
|
|
|
(411.4
|
)
|
|
|
(347.8
|
)
|
Total Shareholders' Equity/(Deficit)
|
|
|
(512.7
|
)
|
|
|
(632.3
|
)
|
Noncontrolling Interests
|
|
|
40.6
|
|
|
|
39.8
|
|
Total Equity/(Deficit)
|
|
|
(472.1
|
)
|
|
|
(592.5
|
)
|
TOTAL
|
|
|
$
|
4,087.7
|
|
|
|
$
|
3,998.1
|
|
|
|
|
|
|
|
|
|
|
|
|
MEAD JOHNSON NUTRITION COMPANY
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(Dollars in millions)
|
(UNAUDITED)
|
|
|
|
|
Year Ended December 31,
|
|
|
|
2016
|
|
|
2015
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
Net Earnings
|
|
|
$
|
549.3
|
|
|
|
$
|
655.3
|
|
Adjustments to Reconcile Net Earnings to Net Cash Provided by
Operating Activities:
|
|
|
|
|
|
|
Depreciation and Amortization
|
|
|
99.6
|
|
|
|
99.1
|
|
Stock-Based Compensation Expense
|
|
|
34.6
|
|
|
|
26.4
|
|
Deferred Income Taxes
|
|
|
(53.3
|
)
|
|
|
43.3
|
|
Exchange Loss from Devaluation
|
|
|
31.7
|
|
|
|
2.3
|
|
Mark-to-market on Trading Security
|
|
|
-
|
|
|
|
(5.6
|
)
|
Pension and Other Post-employment Benefits Expense
|
|
|
(7.4
|
)
|
|
|
12.8
|
|
Impairment of Long-Lived Assets
|
|
|
45.9
|
|
|
|
-
|
|
Other
|
|
|
(3.6
|
)
|
|
|
(1.4
|
)
|
Change in Assets and Liabilities:
|
|
|
|
|
|
|
Receivables
|
|
|
(42.0
|
)
|
|
|
10.4
|
|
Inventories
|
|
|
(8.9
|
)
|
|
|
25.8
|
|
Accounts Payable
|
|
|
52.5
|
|
|
|
3.7
|
|
Accrued Expenses, Rebates and Returns
|
|
|
47.0
|
|
|
|
73.8
|
|
Income Taxes Payable
|
|
|
(40.7
|
)
|
|
|
15.3
|
|
Other Assets and Liabilities
|
|
|
6.2
|
|
|
|
38.8
|
|
Pension and Other Post-employment Benefits Contributions
|
|
|
(19.3
|
)
|
|
|
(90.1
|
)
|
Net Cash Provided by Operating Activities
|
|
|
691.6
|
|
|
|
909.9
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
Payments for Capital Expenditures
|
|
|
(149.0
|
)
|
|
|
(173.7
|
)
|
Proceeds from Sale of Property, Plant and Equipment
|
|
|
0.3
|
|
|
|
0.5
|
|
Net Cash Used in Investing Activities
|
|
|
(148.7
|
)
|
|
|
(173.2
|
)
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
Proceeds from Short-term Borrowings
|
|
|
1.6
|
|
|
|
1,003.0
|
|
Repayments of Short-term Borrowings
|
|
|
(0.3
|
)
|
|
|
(1,002.9
|
)
|
Proceeds from Issuance of Long-term Notes, net of original issue
discounts and expenses paid
|
|
|
(0.1
|
)
|
|
|
1,487.7
|
|
Proceeds from Long-term Revolver Borrowings
|
|
|
-
|
|
|
|
446.0
|
|
Repayment of Long-term Revolver Borrowings
|
|
|
-
|
|
|
|
(446.0
|
)
|
Payments of Dividends
|
|
|
(308.8
|
)
|
|
|
(326.0
|
)
|
Stock-based Compensation related Proceeds and Excess Tax Benefits
|
|
|
15.9
|
|
|
|
25.4
|
|
Stock-based Compensation Tax Withholdings
|
|
|
(4.4
|
)
|
|
|
(11.4
|
)
|
Payments for Repurchase of Common Stock
|
|
|
(100.4
|
)
|
|
|
(1,437.0
|
)
|
Purchase of Noncontrolling Interest Redeemable Shares
|
|
|
-
|
|
|
|
(24.2
|
)
|
Purchase of Trading Securities
|
|
|
-
|
|
|
|
(16.2
|
)
|
Sale of Trading Securities
|
|
|
-
|
|
|
|
21.7
|
|
Distributions to Noncontrolling Interests
|
|
|
(3.1
|
)
|
|
|
(6.9
|
)
|
Net Cash Used in Financing Activities
|
|
|
(399.6
|
)
|
|
|
(286.8
|
)
|
Effects of Changes in Exchange Rates on Cash and Cash Equivalents
|
|
|
(49.3
|
)
|
|
|
(46.2
|
)
|
NET INCREASE IN CASH AND CASH EQUIVALENTS
|
|
|
94.0
|
|
|
|
403.7
|
|
CASH AND CASH EQUIVALENTS:
|
|
|
|
|
|
|
Beginning of Period
|
|
|
1,701.4
|
|
|
|
1,297.7
|
|
End of Period
|
|
|
$
|
1,795.4
|
|
|
|
$
|
1,701.4
|
|
|
|
|
|
|
|
|
|
|
|
|
Mead Johnson Nutrition Company Financial Information
(UNAUDITED) Reconciliation of Non-GAAP to GAAP Results
This news release contains non-GAAP financial measures, each of which is
listed in the tables below. The items included in GAAP measures, but
excluded for the purpose of determining the non-GAAP financial measures,
include significant income/expenses not indicative of underlying
operating results, including the related tax effect and, at times, the
impact of foreign exchange. The non-GAAP measures represent an
indication of the company's underlying operating results and are
intended to enhance an investor's overall understanding of the company's
financial performance and ability to compare the company's performance
to that of its peer companies. In addition, this information is among
the primary indicators the company uses as a basis for evaluating
company performance, setting incentive compensation targets and planning
and forecasting of future periods. This information is not intended to
be considered in isolation or as a substitute for financial measures
prepared in accordance with GAAP. Tables that reconcile non-GAAP to GAAP
disclosure follow below.
Constant Dollar
Certain measures in this release are presented excluding the impact of
foreign currency exchange (constant dollar). To present this
information, current period results for entities reporting in currencies
other than United States dollars are translated into United States
dollars at the average exchange rates in effect during the corresponding
period of the prior fiscal year, rather than the actual average exchange
rates in effect during the current fiscal year. The company believes
that these constant dollar measures provide useful information to
investors because they provide transparency to underlying performance by
excluding the effect that foreign currency exchange rate fluctuations
have on period-to-period comparability given volatility in foreign
currency exchange markets. The primary currencies which impact the
company are: the Argentine peso, the Chinese renminbi, the Hong Kong
dollar, the Mexican peso and the Philippine peso.
Specified Items
Non-GAAP measures presented within this release exclude Specified Items.
The company considers Specified Items to be significant income/expense
items as not indicative of underlying operating results, including the
related tax effect. See below for a description of Specified Items and
the related tax effect.
Mead Johnson Nutrition Company
|
Financial Information (UNAUDITED)
|
Reconciliation of Non-GAAP to GAAP Results
|
|
Constant dollar gross sales
|
|
|
|
|
|
|
Three Months Ended December 31,
|
|
|
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
|
|
|
|
Constant
|
Gross Sales
|
|
|
|
|
2016
|
|
2015
|
|
|
|
|
Reported
|
|
|
|
Exchange
|
|
|
|
Dollar
|
Total gross sales
|
|
|
|
|
$
|
1,265.3
|
|
|
$
|
1,310.2
|
|
|
|
|
|
(3)%
|
|
|
|
(3)%
|
|
|
|
-%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant dollar net sales
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
December 31,
|
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollar
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
|
|
|
Constant
|
|
|
Impact of
|
|
|
Excluding
|
Net Sales
|
|
|
2016
|
|
|
2015
|
|
|
Reported
|
|
|
Exchange
|
|
|
Dollar
|
|
|
Venezuela
|
|
|
Venezuela
|
Asia
|
|
|
$
|
436.9
|
|
|
|
$
|
468.0
|
|
|
|
(7)%
|
|
|
(3)%
|
|
|
(4)%
|
|
|
|
|
|
|
Latin America
|
|
|
156.3
|
|
|
|
169.8
|
|
|
|
(8)%
|
|
|
(12)%
|
|
|
4%
|
|
|
(4)%
|
|
|
8%
|
North America/Europe
|
|
|
308.4
|
|
|
|
329.2
|
|
|
|
(6)%
|
|
|
(1)%
|
|
|
(5)%
|
|
|
|
|
|
|
Net Sales
|
|
|
901.6
|
|
|
|
$
|
967.0
|
|
|
|
(7)%
|
|
|
(4)%
|
|
|
(3)%
|
|
|
(1)%
|
|
|
(2)%
|
Impact of Foreign Exchange
|
|
|
37.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant Dollar Sales
|
|
|
$
|
938.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dollar
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
|
|
|
Constant
|
|
|
Impact of
|
|
|
Excluding
|
Net Sales
|
|
|
2016
|
|
|
2015
|
|
|
Reported
|
|
|
Exchange
|
|
|
Dollar
|
|
|
Venezuela
|
|
|
Venezuela
|
Asia
|
|
|
$
|
1,856.9
|
|
|
|
$
|
2,039.0
|
|
|
|
(9)%
|
|
|
(4)%
|
|
|
(5)%
|
|
|
|
|
|
|
Latin America
|
|
|
643.7
|
|
|
|
757.1
|
|
|
|
(15)%
|
|
|
(14)%
|
|
|
(1)%
|
|
|
(7)%
|
|
|
6%
|
North America/Europe
|
|
|
1,242.1
|
|
|
|
1,275.2
|
|
|
|
(3)%
|
|
|
(1)%
|
|
|
(2)%
|
|
|
|
|
|
|
Net Sales
|
|
|
3,742.7
|
|
|
|
$
|
4,071.3
|
|
|
|
(8)%
|
|
|
(5)%
|
|
|
(3)%
|
|
|
(1)%
|
|
|
(2)%
|
Impact of Foreign Exchange
|
|
|
189.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant Dollar Sales
|
|
|
$
|
3,932.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP constant dollar gross margin
|
|
|
|
|
Three Months Ended December 31,
|
|
|
Year Ended December 31,
|
|
|
|
2016
|
|
2015
|
|
|
|
|
2016
|
|
2015
|
|
|
|
|
|
Gross
|
|
Gross
|
|
Gross
|
|
Gross
|
|
|
|
|
Gross
|
|
Gross
|
|
Gross
|
|
Gross
|
|
|
|
|
|
Profit
|
|
Margin
|
|
Profit
|
|
Margin
|
|
Change
|
|
|
Profit
|
|
Margin
|
|
Profit
|
|
Margin
|
|
Change
|
GAAP Gross Profit and Gross Margin
|
|
|
$
|
575.1
|
|
|
63.8
|
%
|
|
$
|
608.4
|
|
|
62.9
|
%
|
|
0.9%
|
|
|
$
|
2,401.7
|
|
|
64.2
|
%
|
|
$
|
2,616.0
|
|
|
64.3
|
%
|
|
(0.1)%
|
Pension Remeasurement (a)
|
|
|
(10.5
|
)
|
|
(1.2
|
)%
|
|
(0.4
|
)
|
|
(0.1
|
)%
|
|
|
|
|
(2.5
|
)
|
|
(0.1
|
)%
|
|
3.0
|
|
|
0.1
|
%
|
|
|
Fuel for Growth (b)
|
|
|
-
|
|
|
-%
|
|
10.3
|
|
|
1.0
|
%
|
|
|
|
|
-
|
|
|
-%
|
|
10.3
|
|
|
0.2
|
%
|
|
|
Foreign currency impact
|
|
|
36.6
|
|
|
1.4
|
%
|
|
-
|
|
|
|
|
|
|
|
170.1
|
|
|
1.2
|
%
|
|
-
|
|
|
|
|
|
Non-GAAP Constant Dollar Gross Profit and Gross Margin
|
|
|
$
|
601.2
|
|
|
64.0
|
%
|
|
$
|
618.3
|
|
|
63.9
|
%
|
|
0.1%
|
|
|
$
|
2,569.3
|
|
|
65.3
|
%
|
|
$
|
2,629.3
|
|
|
64.6
|
%
|
|
0.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP constant dollar selling, general
and administrative expenses
|
|
|
|
|
Three Months Ended December 31,
|
|
|
Year Ended December 31,
|
|
|
|
2016
|
|
2015
|
|
% Change
|
|
|
2016
|
|
2015
|
|
% Change
|
GAAP SG&A
|
|
|
$
|
170.9
|
|
|
$
|
211.1
|
|
|
(19
|
)%
|
|
|
$
|
766.5
|
|
|
$
|
890.6
|
|
|
(14
|
)%
|
Pension Remeasurement (a)
|
|
|
17.3
|
|
|
1.1
|
|
|
|
|
|
4.2
|
|
|
(4.4
|
)
|
|
|
Venezuela (d)
|
|
|
-
|
|
|
-
|
|
|
|
|
|
(2.0
|
)
|
|
-
|
|
|
|
Fuel for Growth (b)
|
|
|
-
|
|
|
(0.4
|
)
|
|
|
|
|
-
|
|
|
(0.4
|
)
|
|
|
All Other (e)
|
|
|
(0.8
|
)
|
|
(0.1
|
)
|
|
|
|
|
(2.4
|
)
|
|
(2.0
|
)
|
|
|
Foreign currency impact
|
|
|
11.0
|
|
|
-
|
|
|
|
|
|
40.2
|
|
|
-
|
|
|
|
Non-GAAP Constant Dollar SG&A
|
|
|
$
|
198.4
|
|
|
$
|
211.7
|
|
|
(6
|
)%
|
|
|
$
|
806.5
|
|
|
$
|
883.8
|
|
|
(9
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant dollar segment EBIT
|
|
|
|
|
Three Months Ended December 31,
|
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
|
|
|
|
Constant
|
Earnings Before Interest and Income Taxes (EBIT)
|
|
|
2016
|
|
2015
|
|
|
Reported
|
|
|
|
Exchange
|
|
|
|
Dollar
|
Asia
|
|
|
$
|
118.6
|
|
|
$
|
139.9
|
|
|
|
(15)%
|
|
|
|
(8)%
|
|
|
|
(7)%
|
Latin America
|
|
|
39.6
|
|
|
34.2
|
|
|
|
16%
|
|
|
|
(17)%
|
|
|
|
33%
|
North America/Europe
|
|
|
92.0
|
|
|
96.9
|
|
|
|
(5)%
|
|
|
|
(4)%
|
|
|
|
(1)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
Foreign
|
|
Constant
|
Earnings Before Interest and Income Taxes (EBIT)
|
|
|
2016
|
|
2015
|
|
|
Reported
|
|
Exchange
|
|
Dollar
|
Asia
|
|
|
$
|
559.3
|
|
|
$
|
682.0
|
|
|
|
(18)%
|
|
(6)%
|
|
(12)%
|
Latin America
|
|
|
156.7
|
|
|
175.2
|
|
|
|
(11)%
|
|
(21)%
|
|
10%
|
North America/Europe
|
|
|
380.3
|
|
|
361.8
|
|
|
|
5%
|
|
(4)%
|
|
9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Corporate and Other EBIT
|
|
|
|
|
Three Months Ended December 31,
|
|
|
|
Corporate and Other
|
|
|
2016
|
|
2015
|
|
|
% Change
|
EBIT
|
|
|
$
|
(24.2
|
)
|
|
$
|
(75.2
|
)
|
|
|
68%
|
Pension Remeasurement (a)
|
|
|
(30.8
|
)
|
|
(1.7
|
)
|
|
|
|
Fuel for Growth (b)
|
|
|
10.8
|
|
|
25.1
|
|
|
|
|
Venezuela (d)
|
|
|
0.6
|
|
|
-
|
|
|
|
|
All Other (e)
|
|
|
1.5
|
|
|
0.4
|
|
|
|
|
Non-GAAP EBIT
|
|
|
$
|
(42.1
|
)
|
|
$
|
(51.4
|
)
|
|
|
18%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
|
|
|
|
Corporate and Other
|
|
|
2016
|
|
|
|
2015
|
|
|
|
|
% Change
|
EBIT
|
|
|
$
|
(277.6
|
)
|
|
|
|
$
|
(282.8
|
)
|
|
|
|
|
2%
|
Pension Remeasurement (a)
|
|
|
(7.4
|
)
|
|
|
|
8.2
|
|
|
|
|
|
|
Investigation Accrual (c)
|
|
|
-
|
|
|
|
|
12.0
|
|
|
|
|
|
|
Fuel for Growth (b)
|
|
|
29.2
|
|
|
|
|
25.1
|
|
|
|
|
|
|
Venezuela (d)
|
|
|
81.8
|
|
|
|
|
-
|
|
|
|
|
|
|
All Other (e)
|
|
|
4.5
|
|
|
|
|
(0.7
|
)
|
|
|
|
|
|
Non-GAAP EBIT
|
|
|
$
|
(169.5
|
)
|
|
|
|
$
|
(238.2
|
)
|
|
|
|
|
29%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP EBIT and constant dollar EBIT
|
|
|
|
|
Three Months Ended December 31,
|
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
Constant
|
|
Foreign
|
|
|
|
2016
|
|
2015
|
|
|
Reported
|
|
Dollar
|
|
Exchange
|
EBIT
|
|
|
$
|
226.0
|
|
|
$
|
195.8
|
|
|
|
15
|
%
|
|
25
|
%
|
|
(10
|
)%
|
Pension Remeasurement (a)
|
|
|
(30.8
|
)
|
|
(1.7
|
)
|
|
|
|
|
|
|
|
Investigation Accrual (c)
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
|
|
Fuel for Growth (b)
|
|
|
10.8
|
|
|
25.1
|
|
|
|
|
|
|
|
|
Venezuela (d)
|
|
|
0.6
|
|
|
-
|
|
|
|
|
|
|
|
|
All Other (e)
|
|
|
1.5
|
|
|
0.4
|
|
|
|
|
|
|
|
|
Non-GAAP EBIT
|
|
|
208.1
|
|
|
219.6
|
|
|
|
(5
|
)%
|
|
|
|
|
Foreign currency impact
|
|
|
19.3
|
|
|
-
|
|
|
|
|
|
|
|
|
Non-GAAP Constant Dollar EBIT
|
|
|
$
|
227.4
|
|
|
$
|
219.6
|
|
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31,
|
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
Constant
|
|
Foreign
|
|
|
|
2016
|
|
2015
|
|
|
Reported
|
|
Dollar
|
|
Exchange
|
EBIT
|
|
|
$
|
818.7
|
|
|
$
|
936.2
|
|
|
|
(13
|
)%
|
|
(4
|
)%
|
|
(9
|
)%
|
Pension Remeasurement (a)
|
|
|
(7.4
|
)
|
|
8.2
|
|
|
|
|
|
|
|
|
Investigation Accrual (c)
|
|
|
-
|
|
|
12.0
|
|
|
|
|
|
|
|
|
Fuel for Growth (b)
|
|
|
29.2
|
|
|
25.1
|
|
|
|
|
|
|
|
|
Venezuela (d)
|
|
|
81.8
|
|
|
-
|
|
|
|
|
|
|
|
|
All Other (e)
|
|
|
4.5
|
|
|
(0.7
|
)
|
|
|
|
|
|
|
|
Non-GAAP EBIT
|
|
|
926.8
|
|
|
980.8
|
|
|
|
(6
|
)%
|
|
|
|
|
Foreign currency impact
|
|
|
80.2
|
|
|
-
|
|
|
|
|
|
|
|
|
Non-GAAP Constant Dollar EBIT
|
|
|
$
|
1,007.0
|
|
|
$
|
980.8
|
|
|
|
3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP diluted EPS
|
|
|
|
|
Three Months Ended December 31,
|
|
|
Year Ended December 31,
|
|
|
|
2016
|
|
2015
|
|
% Change
|
|
|
2016
|
|
2015
|
|
% Change
|
GAAP EPS-Diluted
|
|
|
$
|
0.91
|
|
|
$
|
0.67
|
|
|
36
|
%
|
|
|
$
|
2.92
|
|
|
$
|
3.27
|
|
|
(11
|
)%
|
Pension Remeasurement (a)
|
|
|
(0.11
|
)
|
|
(0.01
|
)
|
|
|
|
|
|
(0.03
|
)
|
|
0.03
|
|
|
|
Investigation Accrual (c)
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
-
|
|
|
0.04
|
|
|
|
Fuel for Growth (b)
|
|
|
0.05
|
|
|
0.11
|
|
|
|
|
|
|
0.13
|
|
|
0.11
|
|
|
|
Venezuela (d)
|
|
|
(0.08
|
)
|
|
-
|
|
|
|
|
|
|
0.36
|
|
|
-
|
|
|
|
All Other (e)
|
|
|
-
|
|
|
-
|
|
|
|
|
|
|
0.02
|
|
|
(0.01
|
)
|
|
|
Non-GAAP EPS *
|
|
|
$
|
0.78
|
|
|
$
|
0.78
|
|
|
-
|
%
|
|
|
$
|
3.40
|
|
|
$
|
3.44
|
|
|
(1
|
)%
|
* Figures may not sum due to rounding.
|
|
Consolidated Net Debt
|
|
|
|
|
December 31, 2016
|
|
|
December 31, 2015
|
Short-term borrowings
|
|
|
$
|
3.9
|
|
|
$
|
3.0
|
Long-Term Debt
|
|
|
2,976.2
|
|
|
2,981.0
|
Total Debt
|
|
|
2,980.1
|
|
|
2,984.0
|
Less: Cash and cash equivalents
|
|
|
1,795.4
|
|
|
1,701.4
|
Net debt
|
|
|
$
|
1,184.7
|
|
|
$
|
1,282.6
|
|
|
|
|
|
|
|
|
|
Non-GAAP Guidance
|
|
|
|
|
High End
|
|
|
Low End
|
Reported Sales
|
|
|
-
|
%
|
|
|
(3
|
)%
|
Less impact of Foreign Currency
|
|
|
(2
|
)%
|
|
|
(2
|
)%
|
Constant Dollar Sales
|
|
|
2
|
%
|
|
|
(1
|
)%
|
|
|
|
|
|
|
|
GAAP Earnings per Share
|
|
|
$
|
3.20
|
|
|
|
$
|
3.05
|
|
Less Specified Items
|
|
|
(0.10
|
)
|
|
|
(0.10
|
)
|
Less impact of Foreign Currency
|
|
|
(0.20
|
)
|
|
|
(0.20
|
)
|
Non-GAAP Earnings per Share
|
|
|
$
|
3.50
|
|
|
|
$
|
3.35
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Pension Remeasurement: When incurred, gains and losses related to
the remeasurement of defined benefit pension and post-employment benefit
plans are classified as Specified Items and excluded from non-GAAP
performance measures. Pension remeasurement reflects changes in the
pension assets and liabilities above what was estimated and included in
periodic costs. Factors beyond our control such as changes in discount
rates, market volatility and mortality assumptions drive the
remeasurement amount. The majority of our pension and post-employment
plans are frozen, and therefore the benefit provided to such employees
is not related to our underlying operations.
(b) Fuel for Growth: The Company approved a plan to implement a business
productivity program referred to as "Fuel for Growth," during the third
quarter of 2015, which is anticipated to be implemented over a
three-year period. Fuel for Growth is designed to improve operating
efficiencies and reduce costs. Fuel for Growth is expected to improve
profitability and create additional investments behind brand building
and growth initiatives. Fuel for Growth focuses on the optimization of
resources within various operating functions and certain third party
costs across the business.
(c) Investigation Accrual: An accrual made in connection with the SEC
settlement disclosed by the company in July 2015.
(d) Venezuela: Foreign exchange losses, long-lived asset impairments and
other asset write-offs in Venezuela.
(e) All Other: Primarily includes restructuring costs in 2016 and a
marketable securities gain in 2015.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170126005518/en/
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