Broadening Your Perspective 6-2

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The financial statements of The Hershey Company and Tootsie Roll are presented below.

THE HERSHEY COMPANY CONSOLIDATED STATEMENTS OF INCOME
For the years ended December 31,	2011	2010	2009
In thousands of dollars except per share amounts
Net Sales	$6,080,788		$5,671,009	$5,298,668
Costs and Expenses:
Cost of sales	3,548,896	3,255,801	3,245,531
Selling, marketing and administrative	1,477,750	1,426,477	1,208,672
Business realignment and impairment (credits) charges, net	(886	)	83,433	82,875
Total costs and expenses	5,025,760		4,765,711	4,537,078
Income before Interest and Income Taxes	1,055,028		905,298	761,590
Interest expense, net	92,183		96,434	90,459
Income before Income Taxes	962,845		808,864	671,131
Provision for income taxes	333,883		299,065	235,137
Net Income	$628,962		$509,799	$435,994
Net Income Per ShareBasicClass B Common Stock	$2.58		$2.08	$1.77
Net Income Per ShareDilutedClass B Common Stock	$2.56		$2.07	$1.77
Net Income Per ShareBasicCommon Stock	$2.85		$2.29	$1.97
Net Income Per ShareDilutedCommon Stock	$2.74		$2.21	$1.90
Cash Dividends Paid Per Share:
Common Stock	$1.3800	$1.2800	$1.1900
Class B Common Stock	1.2500	1.1600	1.0712
The notes to consolidated financial statements are an integral part of these statements and are included in the Hershey's 2011 Annual Report, available at www.thehersheycompany.com.

THE HERSHEY COMPANY CONSOLIDATED BALANCE SHEETS
December 31,	2011	2010
In thousands of dollars
ASSETS
Current Assets:
Cash and cash equivalents	$693,686	$884,642
Accounts receivabletrade	399,499	390,061
Inventories	648,953	533,622
Deferred income taxes	136,861	55,760
Prepaid expenses and other	167,559		141,132
Total current assets	2,046,558	2,005,217
Property, Plant and Equipment, Net	1,559,717	1,437,702
Goodwill	516,745	524,134
Other Intangibles	111,913	123,080
Deferred Income Taxes	38,544	21,387
Other Assets	138,722		161,212
Total assets	$4,412,199		$4,272,732
LIABILITIES AND STOCKHOLDERS EQUITY
Current Liabilities:
Accounts payable	$420,017	$410,655
Accrued liabilities	612,186	593,308
Accrued income taxes	1,899	9,402
Short-term debt	42,080	24,088
Current portion of long-term debt	97,593		261,392
Total current liabilities	1,173,775	1,298,845
Long-term Debt	1,748,500	1,541,825
Other Long-term Liabilities	617,276		494,461
Total liabilities	3,539,551		3,335,131
Commitments and Contingencies
Stockholders Equity:
The Hershey Company Stockholders Equity
Preferred Stock, shares issued: none in 2011 and 2010
Common Stock, shares issued: 299,269,702 in 2011 and 299,195,325 in 2010	299,269	299,195
Class B Common Stock, shares issued: 60,632,042 in 2011 and 60,706,419 in 2010	60,632	60,706
Additional paid-in capital	490,817	434,865
Retained earnings	4,699,597	4,374,718
TreasuryCommon Stock shares, at cost: 134,695,826 in 2011 and 132,871,512 in 2010	(4,258,962	)	(4,052,101	)
Accumulated other comprehensive loss	(442,331	)	(215,067	)
The Hershey Company stockholders equity	849,022		902,316
Noncontrolling interests in subsidiaries	23,626		35,285
Total stockholders equity	872,648		937,601
Total liabilities and stockholdersequity	$4,412,199		$4,272,732

THE HERSHEY COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31,	2011	2010	2009
In thousands of dollars
Cash Flows Provided from (Used by) Operating Activities
Net income	$628,962	$509,799	$435,994
Adjustments to reconcile net income to net cash provided from operations:
Depreciation and amortization	215,763	197,116	182,411
Stock-based compensation expense, net of tax of $15,127, $17,413 and $19,223, respectively	28,341	32,055	34,927
Excess tax benefits from stock-based compensation	(13,997	)	(1,385	)	(4,455	)
Deferred income taxes	33,611	(18,654	)	(40,578	)
Gain on sale of trademark licensing rights, net of tax of $5,962	(11,072	)
Business realignment and impairment charges, net of tax of $18,333, $20,635 and $38,308, respectively	30,838	77,935	60,823
Contributions to pension plans	(8,861	)	(6,073	)	(54,457	)
Changes in assets and liabilities, net of effects from business acquisitions and divestitures:
Accounts receivabletrade	(9,438	)	20,329	46,584
Inventories	(115,331	)	(13,910	)	74,000
Accounts payable	7,860	90,434	37,228
Other assets and liabilities	(205,809	)	13,777	293,272
Net Cash Provided from Operating Activities	580,867		901,423		1,065,749
Cash Flows Provided from (Used by) Investing Activities
Capital additions	(323,961	)	(179,538	)	(126,324	)
Capitalized software additions	(23,606	)	(21,949	)	(19,146	)
Proceeds from sales of property, plant and equipment	312	2,201	10,364
Proceeds from sales of trademark licensing rights	20,000
Business acquisitions	(5,750	)		(15,220	)
Net Cash (Used by) Investing Activities	(333,005	)	(199,286	)	(150,326	)
Cash Flows Provided from (Used by) Financing Activities
Net change in short-term borrowings	10,834	1,156	(458,047	)
Long-term borrowings	249,126	348,208
Repayment of long-term debt	(256,189	)	(71,548	)	(8,252	)
Proceeds from lease financing agreement	47,601
Cash dividends paid	(304,083	)	(283,434	)	(263,403	)
Exercise of stock options	184,411	92,033	28,318
Excess tax benefits from stock-based compensation	13,997	1,385	4,455
Contributions from noncontrolling interests in subsidiaries		10,199	7,322
Repurchase of Common Stock	(384,515	)	(169,099	)	(9,314	)
Net Cash (Used by) Financing Activities	(438,818	)	(71,100	)	(698,921	)
(Decrease) Increase in Cash and Cash Equivalents	(190,956	)	631,037	216,502
Cash and Cash Equivalents as of January 1	884,642	253,605	37,103
Cash and Cash Equivalents as of December 31	$693,686		$884,642		$253,605
Interest Paid	$97,892	$97,932	$91,623
Income Taxes Paid	292,315	350,948	252,230

TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF Earnings, Comprehensive Earnings and Retained Earnings (in thousands except per share data)
For the year ended December 31,
2011	2010	2009
Net product sales	$528,369	$517,149	$495,592
Rental and royalty revenue	4,136	4,299	3,739
Total revenue	532,505		521,448		499,331
Product cost of goods sold	365,225	349,334	319,775
Rental and royalty cost	1,038	1,088	852
Total costs	366,263		350,422		320,627
Product gross margin	163,144	167,815	175,817
Rental and royalty gross margin	3,098	3,211	2,887
Total gross margin	166,242		171,026		178,704
Selling, marketing and administrative expenses	108,276	106,316	103,755
Impairment charges			14,000
Earnings from operations	57,966		64,710		60,949
Other income (expense), net	2,946		8,358		2,100
Earnings before income taxes	60,912		73,068		63,049
Provision for income taxes	16,974		20,005		9,892
Net earnings	$43,938		$53,063		$53,157
Net earnings	$43,938	$53,063	$53,157
Other comprehensive earnings (loss)	(8,740	)	1,183	2,845
Comprehensive earnings	$35,198		$54,246		$56,002
Retained earnings at beginning of year.	$135,866	$147,687	$144,949
Net earnings	43,938	53,063	53,157
Cash dividends	(18,360	)	(18,078	)	(17,790	)
Stock dividends	(47,175	)	(46,806	)	(32,629	)
Retained earnings at end of year	$114,269		$135,866		$147,687
Earnings per share	$0.76	$0.90	$0.89
Average Common and Class B Common shares outstanding	57,892	58,685	59,425
(The accompanying notes are an integral part of these statements.)

CONSOLIDATED STATEMENTS OF Financial Position TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES (in thousands except per share data)
Assets	December 31,
2011	2010
CURRENT ASSETS:
Cash and cash equivalents	$78,612	$115,976
Investments	10,895	7,996
Accounts receivable trade, less allowances of $1,731 and $1,531	41,895	37,394
Other receivables	3,391	9,961