Mead Johnson Nutrition Reports Second Quarter and First-Half 2015 Earnings Consistent with Previous Announcement
“We faced a number of challenges in the second quarter and that is
reflected in our results,” said Kasper Jakobsen, Chief Executive
Officer. “While we are pleased with our strong performance in
(1) Constant dollar figures exclude the impact of changes in foreign currency exchange rates and non-GAAP results exclude Specified Items. For a description of Specified Items, and a reconciliation of non-GAAP to GAAP and constant dollar results, see the schedules titled “Supplemental Financial Information” and “Reconciliation of Non-GAAP to GAAP Results.”
Second Quarter Company Results
Constant dollar sales were 3% lower than the prior year. Volume declines
in
Gross margin was 65.5%, up from 61.6% in the second quarter of 2014 mainly due to lower dairy costs which benefited all segments.
Investment in advertising and promotion was 18.4% of sales, reflecting
the company’s continued commitment to key growth initiatives, notably in
Earnings before interest and income taxes (“EBIT”) totaled $229.2 million in the second quarter of 2015 compared to the $244.9 million for the prior year quarter. Despite higher gross margin, EBIT was below the prior year as a result of lower revenue and increased investment in demand creation.
The company’s effective tax rate (“ETR”) was 24.5% in the second quarter, compared to 23.3% in the prior year quarter. The higher ETR reflected a change in geographic earnings mix toward jurisdictions with higher tax rates.
Net earnings attributable to shareholders were $162.9 million compared to $171.4 million in the prior year quarter.
Second Quarter Segment Results
Gross margin in the segment improved compared to the prior year quarter. Despite strong investment in advertising and promotion, operating expenses in total were lower as a percentage of sales which resulted in an EBIT margin improvement of 470 basis points over the second quarter 2014 to 26.6%. Second quarter EBIT of $85.3 million was 25% higher than the prior year quarter of $68.0 million.
Gross margin improved over the prior year quarter and helped fund additional investment in demand creation on a constant currency basis. Operating expenses were slightly higher than the comparative period due to the absence of a prior year one-time gain. EBIT was $44.8 million, compared to $53.4 million for the same quarter of 2014.
Constant dollar sales in the
EBIT was $156.4 million compared to $195.9 million for the same quarter
a year ago. Higher gross margin was more than offset by investments in
demand-generating activities, mainly in support of new product
introductions in
Corporate and Other
Corporate and Other expenses were $57.3 million for the second quarter of 2015, down from $72.4 million in the second quarter of 2014 mainly due to current year actuarial gains that compared favorably to prior year actuarial losses related to a pension plan. Additionally, short-term investment gains recognized in the current year helped offset the impact of inflation in other operating expenses.
Six-Month Company Results
Constant dollar sales were in line with the prior year. Sales for the
six months ended
Gross margin of 64.7% increased from 62.6% in the prior year as the business benefited from lower dairy costs and improved pricing.
During the first half of 2015, investment in advertising and promotion as a percentage of sales increased by 90 basis points over the same period of 2014. EBIT totaled $514.4 million, down from $536.1 million in the first half of 2014.
The effective tax rate for the first half of 2015 was 24.0% compared to 24.5% a year ago.
Net earnings attributable to shareholders were $370.3 million compared to $373.8 million in the prior year period.
Six-Month Segment Results
EBIT of $163.6 million increased from $134.1 million in the first six months of 2014.
Operating expenses were below the prior year period, primarily due to a favorable impact from foreign currency translation. EBIT of $102.1 million increased from $100.0 million for the same period a year ago.
Significantly higher investment in demand creation behind growth initiatives launched in the second quarter resulted in operating expenses above prior year. EBIT was $387.9 million, compared to $437.2 million for the same period a year ago.
Corporate and Other
Corporate and Other expenses were $139.2 million for the first six
months of 2015, up from $135.2 million in the first six months of 2014.
A $12 million accrual relating to the previously announced investigation
by the
Cash Flow Items
Cash and cash equivalents increased by $177.4 million since
During the second quarter the company increased its equity position in
its subsidiary in
Outlook for 2015
The company revised its outlook for full-year 2015 on
“We now expect constant dollar revenue in line or slightly above the
prior year and non-GAAP EPS between $3.63 and $3.78. We are encouraged
by both our performance in
Specified Items are expected to be $0.07 per share excluding any further mark-to-market pension adjustments. As a result, full-year GAAP EPS is expected to be in the range of $3.56 to $3.71.
Conference Call Scheduled
Mead Johnson will host a conference call at
Security analysts and investors wishing to participate by telephone
should call (877) 359-9508, pass code: Mead Johnson. Callers outside of
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(2)
program, or participation in WIC; (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
(2)
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.
MEAD JOHNSON NUTRITION COMPANY CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Dollars and shares in millions, except per share data) (UNAUDITED) |
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Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||||
NET SALES | $ | 1,032.4 | $ | 1,111.1 | $ | 2,126.8 | $ | 2,224.4 | ||||||||||
Cost of Products Sold | 356.4 | 426.8 | 749.9 | 832.5 | ||||||||||||||
GROSS PROFIT | 676.0 | 684.3 | 1,376.9 | 1,391.9 | ||||||||||||||
Operating Expenses: | ||||||||||||||||||
Selling, General and Administrative | 230.2 | 242.3 | 463.4 | 475.2 | ||||||||||||||
Advertising and Promotion | 190.2 | 174.6 | 334.6 | 330.3 | ||||||||||||||
Research and Development | 27.7 | 26.7 | 53.6 | 53.8 | ||||||||||||||
Other (Income)/Expenses – net | (1.3 | ) | (4.2 | ) | 10.9 | (3.5 | ) | |||||||||||
EARNINGS BEFORE INTEREST AND INCOME TAXES | 229.2 | 244.9 | 514.4 | 536.1 | ||||||||||||||
Interest Expense—net | 13.9 | 15.3 | 27.7 | 27.7 | ||||||||||||||
EARNINGS BEFORE INCOME TAXES | 215.3 | 229.6 | 486.7 | 508.4 | ||||||||||||||
Provision for Income Taxes | 52.7 | 53.5 | 117.0 | 124.5 | ||||||||||||||
NET EARNINGS | 162.6 | 176.1 | 369.7 | 383.9 | ||||||||||||||
Less Net Earnings/(Loss) Attributable to Noncontrolling Interests | (0.3 | ) | 4.7 | (0.6 | ) | 10.1 | ||||||||||||
NET EARNINGS ATTRIBUTABLE TO SHAREHOLDERS | $ | 162.9 | $ | 171.4 | $ | 370.3 | $ | 373.8 | ||||||||||
Earnings per Share(a)– Basic | ||||||||||||||||||
Net Earnings Attributable to Shareholders | $ | 0.80 | $ | 0.85 | $ | 1.83 | $ | 1.85 | ||||||||||
Earnings per Share(a)– Diluted | ||||||||||||||||||
Net Earnings Attributable to Shareholders | $ | 0.80 | $ | 0.84 | $ | 1.82 | $ | 1.84 | ||||||||||
Weighted Average Shares – Diluted | 203.1 | 202.7 | 203.1 | 202.5 | ||||||||||||||
Dividends Declared per Share | $ | 0.4125 | $ | 0.3750 | $ | 0.8250 | $ | 0.7500 |
(a) The numerator for basic and diluted earnings per share is net earnings attributable to shareholders reduced by dividends and undistributed earnings attributable to unvested shares. 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) |
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June 30, 2015 | December 31, 2014 | |||||||||
ASSETS | ||||||||||
CURRENT ASSETS: | ||||||||||
Cash and Cash Equivalents | $ | 1,475.1 | $ | 1,297.7 | ||||||
Receivables—net of allowances of $6.9 and $9.6 respectively | 367.3 | 387.8 | ||||||||
Inventories | 573.3 | 555.5 | ||||||||
Deferred Income Taxes—net of valuation allowance | 77.4 | 86.8 | ||||||||
Income Taxes Receivable | 23.5 | 7.7 | ||||||||
Prepaid Expenses and Other Assets | 100.1 | 82.6 | ||||||||
Total Current Assets | 2,616.7 | 2,418.1 | ||||||||
Property, Plant, and Equipment—net | 908.2 | 912.7 | ||||||||
Goodwill | 154.9 | 162.7 | ||||||||
Other Intangible Assets—net | 68.3 | 75.4 | ||||||||
Deferred Income Taxes—net of valuation allowance | 67.8 | 65.1 | ||||||||
Other Assets | 143.2 | 142.5 | ||||||||
TOTAL | $ | 3,959.1 | $ | 3,776.5 | ||||||
LIABILITIES AND EQUITY | ||||||||||
CURRENT LIABILITIES: | ||||||||||
Short-term Borrowings | $ | 1.0 | $ | 4.1 | ||||||
Accounts Payable | 521.7 | 512.3 | ||||||||
Dividends Payable | 84.4 | 76.6 | ||||||||
Accrued Expenses and Other Liabilities | 209.8 | 203.7 | ||||||||
Accrued Rebates and Returns | 351.9 | 329.1 | ||||||||
Deferred Income—current | 13.2 | 34.3 | ||||||||
Income Taxes—payable and deferred | 47.7 | 46.4 | ||||||||
Total Current Liabilities | 1,229.7 | 1,206.5 | ||||||||
Long-Term Debt | 1,506.2 | 1,503.9 | ||||||||
Deferred Income Taxes—noncurrent | 10.8 | 12.4 | ||||||||
Pension and Other Post-employment Liabilities | 209.7 | 211.1 | ||||||||
Other Liabilities - noncurrent | 204.6 | 192.8 | ||||||||
Total Liabilities | 3,161.0 | 3,126.7 | ||||||||
COMMITMENTS AND CONTINGENCIES | ||||||||||
REDEEMABLE NONCONTROLLING INTEREST | — | 66.0 | ||||||||
EQUITY | ||||||||||
Shareholders’ Equity | ||||||||||
Common Stock, $0.01 par value: 3,000 authorized, 207.7 and 207.2 issued, respectively | 2.1 | 2.1 | ||||||||
Additional Paid-in/(Distributed) Capital | (580.9 | ) | (641.3 | ) | ||||||
Retained Earnings | 1,954.6 | 1,775.0 | ||||||||
Treasury Stock—at cost | (362.6 | ) | (362.6 | ) | ||||||
Accumulated Other Comprehensive Loss | (256.1 | ) | (198.9 | ) | ||||||
Total Shareholders’ Equity | 757.1 | 574.3 | ||||||||
Noncontrolling Interests | 41.0 | 9.5 | ||||||||
Total Equity | 798.1 | 583.8 | ||||||||
TOTAL | $ | 3,959.1 | $ | 3,776.5 |
MEAD JOHNSON NUTRITION COMPANY CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in millions) (UNAUDITED) |
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Six Months Ended June 30, | ||||||||||
2015 | 2014 | |||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||
Net Earnings | $ | 369.7 | $ | 383.9 | ||||||
Adjustments to Reconcile Net Earnings to Net Cash Provided by Operating Activities: | ||||||||||
Depreciation and Amortization | 48.8 | 44.2 | ||||||||
Other | 26.3 | 26.7 | ||||||||
Changes in Assets and Liabilities | 14.2 | (103.7 | ) | |||||||
Payments for Settlement of Interest Rate Forward Swaps | — | (45.0 | ) | |||||||
Pension and Other Post-employment Benefits Contributions | (2.5 | ) | (2.1 | ) | ||||||
Net Cash Provided by Operating Activities |
456.5 | 304.0 | ||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||
Capital Expenditures | (80.0 | ) | (94.8 | ) | ||||||
Sale of Property, Plant and Equipment | 0.4 | 0.3 | ||||||||
Proceeds from/(Investment in) Other Companies | — | 4.0 | ||||||||
Net Cash Used in Investing Activities | (79.6 | ) | (90.5 | ) | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||
Proceeds from Short-term Borrowings | 1.0 | 3.2 | ||||||||
Repayments of Short-term Borrowings | (4.0 | ) | (1.3 | ) | ||||||
Payments of Dividends | (159.8 | ) | (144.7 | ) | ||||||
Stock-Based Compensation Related Proceeds and Excess Tax Benefits | 19.7 | 20.3 | ||||||||
Purchases of Treasury Stock | — | (26.8 | ) | |||||||
Stock-Based Compensation Tax Withholdings | (10.3 | ) | (7.8 | ) | ||||||
Long-term Debt Borrowings, net of original issue discount and expenses paid | — | 492.3 | ||||||||
Purchase of Trading Security | (16.2 | ) | — | |||||||
Purchase of Redeemable Shares | (5.1 | ) | — | |||||||
Distributions to Noncontrolling Interests | (6.9 | ) | (4.4 | ) | ||||||
Net Cash Used in Financing Activities | (181.6 | ) | 330.8 | |||||||
Effects of Changes in Exchange Rates on Cash and Cash Equivalents | (17.9 | ) | (8.8 | ) | ||||||
NET INCREASE IN CASH AND CASH EQUIVALENTS | 177.4 | 535.5 | ||||||||
CASH AND CASH EQUIVALENTS: | ||||||||||
Beginning of Period | 1,297.7 | 1,050.8 | ||||||||
End of Period | $ | 1,475.1 | $ | 1,586.3 |
MEAD JOHNSON NUTRITION COMPANY SUPPLEMENTAL FINANCIAL INFORMATION (Dollars in millions) (UNAUDITED) |
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This news release contains non-GAAP financial measures, which may include non-GAAP net sales, gross profit, certain components of operating expenses including selling, general and administrative, research and development and other (income)/expenses net, EBIT, earnings and earnings per share information. The items included in GAAP measures, but excluded for the purpose of determining the above listed non-GAAP financial measures, include significant income/expenses not indicative of underlying operating results, including the related tax effect. The above listed 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. 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. |
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Three Months Ended June 30, | % Change | % Change Due to | ||||||||||||||||||||||||||||
Net Sales | 2015 | % of Total | 2014 | % of Total | Reported | Constant Dollar | Volume | Price/Mix |
Foreign Exchange |
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Asia | $ | 513.2 | 50 | % | $ | 575.6 | 52 | % | (11 | )% | (10 | )% | (9 | )% | (1 | )% | (1 | )% | ||||||||||||
Latin America | 198.4 | 19 | % | 224.4 | 20 | % | (12 | )% | 1 | % | (5 | )% | 6 | % | (13 | )% | ||||||||||||||
North America/Europe | 320.8 | 31 | % | 311.1 | 28 | % | 3 | % | 6 | % | 1 | % | 5 | % | (3 | )% | ||||||||||||||
Net Sales | $ | 1,032.4 | 100 | % | $ | 1,111.1 | 100 | % | (7 | )% | (3 | )% | (5 | )% | 2 | % | (4 | )% | ||||||||||||
Earnings Before Interest and Income Taxes (EBIT) | 2015 | EBIT % of Sales | 2014 | EBIT % of Sales | % Change | |||||||||||||||||||||||||
Asia | $ | 156.4 | 30 | % | $ | 195.9 | 34 | % | (20 | )% | ||||||||||||||||||||
Latin America | 44.8 | 23 | % | 53.4 | 24 | % | (16 | )% | ||||||||||||||||||||||
North America/Europe | 85.3 | 27 | % | 68.0 | 22 | % | 25 | % | ||||||||||||||||||||||
Corporate and Other | (57.3 | ) | (72.4 | ) | 21 | % | ||||||||||||||||||||||||
EBIT | $ | 229.2 | 22 | % | $ | 244.9 | 22 | % | (6 | )% | ||||||||||||||||||||
Six Months Ended June 30, | % Change | % Change Due to | ||||||||||||||||||||||||||||
Net Sales | 2015 | % of Total | 2014 | % of Total | Reported | Constant Dollar | Volume | Price/Mix |
Foreign Exchange |
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Asia | $ | 1,094.2 | 51% | $ | 1,168.3 | 52 | % | (6 | )% | (5 | )% | (5 | )% | — | % | (1 | )% | |||||||||||||
Latin America | 402.8 | 19% | 436.8 | 20 | % | (8 | )% | 7 | % | (1 | )% | 8 | % | (15 | )% | |||||||||||||||
North America/Europe | 629.8 | 30% | 619.3 | 28 | % | 2 | % | 5 | % | 1 | % | 4 | % | (3 | )% | |||||||||||||||
Net Sales | $ | 2,126.8 | 100% | $ | 2,224.4 | 100 | % | (4 | )% | — | % | (3 | )% | 3 | % | (4 | )% | |||||||||||||
Earnings Before Interest and Income Taxes (EBIT) | 2015 | EBIT % of Sales | 2014 | EBIT % of Sales | % Change | |||||||||||||||||||||||||
Asia | $ | 387.9 | 35 | % | $ | 437.2 | 37 | % | (11 | )% | ||||||||||||||||||||
Latin America | 102.1 | 25 | % | $ | 100.0 | 23 | % | 2 | % | |||||||||||||||||||||
North America/Europe | 163.6 | 26 | % | $ | 134.1 | 22 | % | 22 | % | |||||||||||||||||||||
Corporate and Other | (139.2 | ) | $ | (135.2 | ) | (3 | )% | |||||||||||||||||||||||
EBIT | $ | 514.4 | 24 | % | $ | 536.1 | 24 | % | (4 | )% |
MEAD JOHNSON NUTRITION COMPANY RECONCILIATION OF NON-GAAP TO GAAP RESULTS (Dollars in millions, except per share data) (UNAUDITED) |
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Three Months Ended June 30, 2015 | Three Months Ended June 30, 2014 | ||||||||||||||||||||||||||||||||
Specified Items (a) | Specified Items (a) | ||||||||||||||||||||||||||||||||
GAAP |
Mark-to-Market |
All
Other(b) |
Non-GAAP | GAAP |
Mark-to-Market |
All
Other(b) |
Non-GAAP | ||||||||||||||||||||||||||
NET SALES | $ | 1,032.4 | $ | — |
$ |
|
— |
$ | 1,032.4 | $ | 1,111.1 | $ | — | $ | — | $ | 1,111.1 | ||||||||||||||||
Cost of Products Sold | 356.4 | 0.5 | — | 356.9 | 426.8 | (2.5 | ) | — | 424.3 | ||||||||||||||||||||||||
GROSS PROFIT | 676.0 | (0.5 | ) | — | 675.5 | 684.3 | 2.5 | — | 686.8 | ||||||||||||||||||||||||
GROSS MARGIN % | 65.5 | % | (0.1 | )% | — | % | 65.4 | % | 61.6 | % | 0.2 | % | — | % | 61.8 | % | |||||||||||||||||
Operating Expenses: | |||||||||||||||||||||||||||||||||
Selling, General and Administrative | 230.2 | 0.8 | (0.5 | ) | 230.5 | 242.3 | (3.9 | ) | (4.6 | ) | 233.8 | ||||||||||||||||||||||
Advertising and Promotion | 190.2 | — | — | 190.2 | 174.6 | — | — | 174.6 | |||||||||||||||||||||||||
Research and Development | 27.7 | 0.2 | — | 27.9 | 26.7 | (0.7 | ) | — | 26.0 | ||||||||||||||||||||||||
Other (Income)/Expenses – net |
(1.3 | ) | — | 6.2 | 4.9 | (4.2 | ) | — | — | (4.2 | ) | ||||||||||||||||||||||
EARNINGS BEFORE INTEREST AND INCOME TAXES | 229.2 | (1.5 | ) | (5.7 | ) | 222.0 | 244.9 | 7.1 | 4.6 | 256.6 | |||||||||||||||||||||||
EBIT as a % of Sales | 22.2 | % | (0.1 | )% | (0.6 | )% | 21.5 | % | 22.0 | % | 0.6 | % | 0.4 | % | 23.1 | % | |||||||||||||||||
Interest Expense – net | 13.9 | — | — | 13.9 | 15.3 | — | — | 15.3 | |||||||||||||||||||||||||
EARNINGS BEFORE INCOME TAXES | 215.3 | (1.5 | ) | (5.7 | ) | 208.1 | 229.6 | 7.1 | 4.6 | 241.3 | |||||||||||||||||||||||
Provision for Income Taxes | 52.7 | (0.5 | ) | 1.1 | 53.3 | 53.5 | 2.4 | 1.5 | 57.4 | ||||||||||||||||||||||||
Effective Tax Rate | 24.5 | % | (0.1 | )% | 1.2 | % | 25.6 | % | 23.3 | % | 0.3 | % | 0.2 | % | 23.8 | % | |||||||||||||||||
NET EARNINGS | 162.6 | (1.0 | ) | (6.8 | ) | 154.8 | 176.1 | 4.7 | 3.1 | 183.9 | |||||||||||||||||||||||
Less Net Earnings/(Loss) Attributable to Noncontrolling Interests |
(0.3 | ) | — | — | (0.3 | ) | 4.7 | — | — | 4.7 | |||||||||||||||||||||||
NET EARNINGS ATTRIBUTABLE TO SHAREHOLDERS | $ | 162.9 | $ | (1.0 | ) |
$ |
(6.8 |
) | $ | 155.1 | $ | 171.4 | $ | 4.7 | $ | 3.1 | $ | 179.2 | |||||||||||||||
Earnings per Share– Diluted | |||||||||||||||||||||||||||||||||
Net Earnings Attributable to Shareholders | $ | 0.80 | $ | — |
$ |
|
(0.04 | ) | $ | 0.76 | $ | 0.84 | $ | 0.02 | $ | 0.02 | $ | 0.88 | |||||||||||||||
Certain figures do not sum due to rounding. |
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(a) All Specified Items are included in Corporate and Other. |
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(b) See the company's form 10-Q for the second quarter for details on Specified Items. |
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MEAD JOHNSON NUTRITION COMPANY RECONCILIATION OF NON-GAAP TO GAAP RESULTS (Dollars in millions, except per share data) (UNAUDITED) |
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Six Months Ended June 30, 2015 | Six Months Ended June 30, 2014 | |||||||||||||||||||||||||||||||||||
Specified Items (a) | Specified Items (a) | |||||||||||||||||||||||||||||||||||
GAAP |
Mark-to-Market |
Investigation |
All
Other(b) |
Non-GAAP | GAAP |
Mark-to-Market |
All
Other(b) |
Non-GAAP | ||||||||||||||||||||||||||||
NET SALES | $ | 2,126.8 | $ | — | $ | — | $ | — | $ | 2,126.8 | $ | 2,224.4 | $ | — | $ | — | $ | 2,224.4 | ||||||||||||||||||
Cost of Products Sold | 749.9 | 0.5 | — | — | 750.4 | 832.5 | (2.5 | ) | — | 830.0 | ||||||||||||||||||||||||||
GROSS PROFIT | 1,376.9 | (0.5 | ) | — | — | 1,376.4 | 1,391.9 | 2.5 | — | 1,394.4 | ||||||||||||||||||||||||||
GROSS MARGIN % | 64.7 | % | — | % | — | % | — | % | 64.7 | % | 62.6 | % | 0.1 | % | — | % | 62.7 | % | ||||||||||||||||||
Operating Expenses: | ||||||||||||||||||||||||||||||||||||
Selling, General and Administrative | 463.4 | 0.8 | — | (1.3 | ) | 462.9 | 475.2 | (3.9 | ) | (10.4 | ) | 460.9 | ||||||||||||||||||||||||
Advertising and Promotion | 334.6 | — | — | — | 334.6 | 330.3 | — | — | 330.3 | |||||||||||||||||||||||||||
Research and Development | 53.6 | 0.2 | — | — | 53.8 | 53.8 | (0.7 | ) | — | 53.1 | ||||||||||||||||||||||||||
Other (Income)/Expenses – net | 10.9 | — | (12.0 | ) | 4.0 | 2.9 | (3.5 | ) | — | — | (3.5 | ) | ||||||||||||||||||||||||
EARNINGS BEFORE INTEREST AND INCOME TAXES | 514.4 | (1.5 | ) | 12.0 | (2.7 | ) | 522.2 | 536.1 | 7.1 | 10.4 | 553.6 | |||||||||||||||||||||||||
EBIT as a % of Sales | 24.2 | % | (0.1 | )% | 0.6 | % | (0.1 | )% | 24.6 | % | 24.1 | % | 0.3 | % | 0.5 | % | 24.9 | % | ||||||||||||||||||
Interest Expense – net | 27.7 | — | — | — | 27.7 | 27.7 | — | — | 27.7 | |||||||||||||||||||||||||||
EARNINGS BEFORE INCOME TAXES | 486.7 | (1.5 | ) | 12.0 | (2.7 | ) | 494.5 | 508.4 | 7.1 | 10.4 | 525.9 | |||||||||||||||||||||||||
Provision for Income Taxes | 117.0 | (0.5 | ) | 3.1 | (1.8 | ) | 117.8 | 124.5 | 2.4 | 3.6 | 130.5 | |||||||||||||||||||||||||
Effective Tax Rate | 24.0 | % | — | % | 0.1 | % | (0.3 | )% | 23.8 | % | 24.5 | % | 0.1 | % | 0.2 | % | 24.8 | % | ||||||||||||||||||
NET EARNINGS | 369.7 | (1.0 | ) | 8.9 | (0.9 | ) | 376.7 | 383.9 | 4.7 | 6.8 | 395.4 | |||||||||||||||||||||||||
Less Net Earnings/(Loss) Attributable to Noncontrolling Interests |
(0.6 | ) | — | — | — | (0.6 | ) | 10.1 | — | — | 10.1 | |||||||||||||||||||||||||
NET EARNINGS ATTRIBUTABLE TO SHAREHOLDERS | $ | 370.3 | $ | (1.0 | ) | $ | 8.9 | $ | (0.9 | ) | $ | 377.3 | $ | 373.8 | $ | 4.7 | $ | 6.8 | $ | 385.3 | ||||||||||||||||
Earnings per Share– Diluted | ||||||||||||||||||||||||||||||||||||
Net Earnings Attributable to Shareholders | $ | 1.82 | $ |
(0.01 |
) |
$ | 0.04 | $ |
— |
|
$ | 1.85 | $ | 1.84 | $ | 0.02 | $ | 0.04 | $ | 1.90 | ||||||||||||||||
Certain figures do not sum due to rounding. |
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(a) All Specified Items are included in Corporate and Other. |
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(b) See the company's form 10-Q for the second quarter for details on Specified Items. |
View source version on businesswire.com: http://www.businesswire.com/news/home/20150723005596/en/
Source:
Mead Johnson Nutrition Company
Investors:
Kathy MacDonald
(847)
832-2182
kathy.macdonald@mjn.com
or
Media:
Christopher
Perille
(847) 832-2178
chris.perille@mjn.com
7/23/2015