Financial Data

Notes to the Consolidated Financial Statements

This problem is based on the 2017 annual report of Campbell Soup Company. Answer the following questions. Refer to the Selected Financial Data for parts (a) to (d). Required: a. Find the net sales in 2014. (Enter your answer in millions.) b. Calculate the operating income (earnings before interest and taxes) in 2013. (Enter your answer in millions.) c. Calculate the difference between operating income (earnings before interest and taxes) and net income (net earnings) in 2015. (Enter your answer in millions.) d. Find the year(s) in which net income (net earnings) decreased compared to the previous year. e. Find the amount of interest paid for 2017 in the Notes to the Consolidated Financial Statements. (Enter your answer in millions.) f. Find the number of stock options exercisable at July 30, 2017 in the Notes to the Consolidated Financial Statements. (Enter your answer in thousands.) g. Find the net sales to customers outside the United States for 2017 in the Notes to the Consolidated Financial Statements. (Enter your answer in millions.) h. Find the cost of products sold for the third quarter of 2017 in the Notes to the Consolidated Financial Statements. (Enter your answer in millions.) million million million a. Net sales b. Operating income c. Difference d. Year(s) e. Amount of interest paid f. Number of stock options exercisable g. Net sales million thousand million h. Cost of products million Item 6. Selected Financial Data 20170) 2016) 20155) 201460 201305 S7,890 $7.961 $8,082 $8,268 $8,052 1,400 960 1,054 1.267 1,474 Fiscal Year (Millions, except per share amounts) Summary of Operations Net sales Earnings before interest and taxes Earnings before taxes Earnings from continuing operations Earnings (loss) from discontinued operations Net earnings Net earnings attributable to Campbell Soup Company 1,293 849 949 1,148 1,349 887 563 666 774 934 81 (231) 887 563 666 855 703 887 563 666 866 712 Financial Position Plant assets - net Total assets $2,454 $2,407 $2,347 $2,318 $2,260 7,726 7,837 8,077 8,100 8,290 3,536 3,533 4,082 4,003 4,438 1,645 1,533 1,377 1,602 1,192 Total debt Total equity S 2.91 $ 1.82 $ 2.13 $ 2.50 $ 3.00 Per Share Data Earnings from continuing operations attributable to Campbell Soup Company - basic.... Earnings from continuing operations attributable to Campbell Soup Company - assuming dilution Net earnings attributable to Campbell Soup Company - basic. Net earnings attributable to Campbell Soup Company - assuming dilution ... Dividends declared 2.89 1.81 2.13 2.48 2.97 2.91 1.82 2.13 2.76 2.27 2.89 1.81 2.13 2.74 2.25 1.40 1.248 1.248 1.248 1.16 Other Statistics S 338 $ 341 $ 380 $ 347 $ 336 Capital expenditures Weighted average shares outstanding - basic. Weighted average shares outstanding - assuming dilution. 305 309 312 314 314 307 311 313 316 317 (All per share amounts below are on a diluted basis) In March 2016, the Financial Accounting Standards Board (FASB) issued guidance that amends accounting for share-based payments, including the accounting for income taxes, forfeitures, and statutory withholding requirements, as well as classification in the statement of cash flows. We adopted the guidance in 2017. In accordance with the prospective adoption of the recognition of excess tax benefits and deficiencies in the Consolidated Statements of Earnings, we recognized a $6 million tax benefit in Taxes on earnings in 2017 In April 2015, the FASB issued guidance that requires debt issuance costs to be presented in the balance sheet as a reduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. We adopted the guidance in 2016 and retrospectively adjusted all prior periods. In November 2015, the FASB issued guidance that requires deferred tax liabilities and assets to be classified as noncurrent in the balance sheet. We adopted the guidance 2016 on a prospective basis and modified the presentation of deferred taxes in the Consolidated Balance Sheet as of July 31, 2016. The 2014 fiscal year consisted of 53 weeks. All other periods had 52 weeks. The 2017 earnings from continuing operations attributable to Campbell Soup Company were impacted by the following: a restructuring charge, related costs and administrative expenses of $37 million ($.12 per share) associated with restructuring and cost savings initiatives, gains of $116 million (S.38 per share) associated with mark-to-market adjustments for defined benefit pension and postretirement plans; impairment charges of $180 million (S.59 per share) related to the intangible assets of the Bolthouse Farms carrot and carrot ingredients reporting unit and the Garden Fresh Gourmet reporting unit; and a tax benefit and reduction to interest expense of $56 million ($.18 per share) primarily associated with the sale of intercompany notes receivable to a financial institution. 2) The 2016 earnings from continuing operations attributable to Campbell Soup Company were impacted by the following: a restructuring charge and administrative expenses of $49 million (S.16 per share) associated with restructuring and cost savings initiatives: losses of $200 million (5.64 per share) associated with mark-to-market adjustments for defined benefit pension and postretirement plans, a gain of $25 million ($.08 per share) associated with a settlement of a claim related to the Kelsen acquisition; and an impairment charge of $127 million (S.41 per share) related to the intangible assets of the Bolthouse Farms carrot and carrot ingredients reporting unit. 6) The 2015 earnings from continuing operations attributable to Campbell Soup Company were impacted by the following: a restructuring charge and administrative expenses of $78 million (S.25 per share) associated with restructuring and cost savings initiatives and losses of $87 million ($.28 per share) associated with mark-to-market adjustments for defined benefit pension and postretirement plans. (4) The 2014 earnings from continuing operations attributable to Campbell Soup Company were impacted by the following: a restructuring charge and related costs of $36 million (S.11 per share) associated with restructuring initiatives; losses of $19 million ($.06 per share) associated with mark-to-market adjustments for defined benefit pension and postretirement plans, a loss of $6 million ($.02 per share) on foreign exchange forward contracts used to hedge the proceeds from the sale of the European simple meals business; $7 million ($.02 per share) tax expense associated with the sale of the European simple meals business, and the estimated impact of the additional week of $25 million ($.08 per share). Earnings from discontinued operations included a gain of S72 million ($.23 per share) on the sale of the European simple meals business. The 2013 earnings from continuing operations attributable to Campbell Soup Company were impacted by the following: a restructuring charge and related costs of $87 million ($.27 per share) associated with restructuring initiatives; gains of $183 million (S.58 per share) associated with mark-to-market adjustments for defined benefit pension and postretirement plans; and $7 million ($.02 per share) of transaction costs related to the acquisition of Bolthouse Farms. Earnings from discontinued operations were impacted by an impairment charge on the intangible assets of the simple meals business in Europe of $263 million (S.83 per share) and tax expense of $18 million (S.06 per share) representing taxes on the difference between the book value and tax basis of the business. Selected Financial Data should be read in conjunction with the Notes to Consolidated Financial Statements. Statements of Cash Flows 2017 2016 2015 Cash Flows from Operating Activities Other Benefit related payments. $ (53) $ (53) Other (55) $ (3) (58) $ (53) $ (52) 110 $ 113 $ 111 Other Cash Flow Information Interest paid Interest received Income taxes paid $ 5 $ 4 $ 3 $ 320 $ 325 $ 333