Mead Johnson Reports Strong Third Quarter Results; Constant Dollar Sales up 15 Percent
GLENVIEW, Ill., Oct 28, 2010 (BUSINESS WIRE) --
Mead Johnson Nutrition Company (NYSE: MJN) announced today its financial results for the third quarter ended Sept. 30, 2010.
- Net sales in the quarter were up 16 percent, including foreign exchange, primarily driven by 12 percent volume growth.
- GAAP net earnings of $0.52 per diluted share for the third quarter of 2010 were up from $0.48 per diluted share a year ago.
- Non-GAAP (1)net earnings for the third quarter increased 8 percent to $0.57 per diluted share from $0.53 per diluted share a year earlier.
- Sales and earnings benefited from double-digit sales growth in all regions. Earnings also benefited from lower interest expense, offset by increased commodity and manufacturing costs, higher demand-generation investments, costs incurred as a stand-alone company and a higher effective tax rate versus the year-ago quarter.
-
Raising full-year non-GAAP EPS guidance range to $2.38 to $2.42 from
$2.35 to $2.40. Including specified items estimated at $0.23 per
share, GAAP EPS guidance is $2.15 to $2.19.
(1) See "Non-GAAP Financial Measures" and the reconciliation of GAAP and non-GAAP results included in this release.
"All regions contributed to our strong performance in the quarter," said Chief Executive Officer Stephen W. Golsby. "Results for the U.S. business reflect further share gains, but also a favorable comparison with the third quarter of 2009 when retailers were reducing inventories to normal levels following the inventory build from the second quarter launch of Enfamil Premium. We also started to reduce inventories in Europe last year from the high levels carried by Bristol-Myers Squibb, our regional distributor. Adjusting for the changes in inventories, sales for the North America/Europe segment increased in the low-single digits bringing year-to-date sales even with the prior year. We continue to experience double-digit sales growth in most of our major Asia and Latin America markets with China, Hong Kong and Brazil growing in excess of the 16 percent constant dollar sales gain for the segment. We are benefiting from overall market growth, as well as increases in share from new product innovations and our investments."
"Looking at the full year, we are projecting slightly higher sales growth than was assumed in our previous guidance. Global sales for the year are projected to be up 8.5 percent to 9.5 percent, excluding foreign exchange. We are further increasing demand generation spending in the fourth quarter to strengthen momentum heading into 2011, as well as assuming a higher effective tax rate. This is on top of a significant ramp up of costs in the quarter associated with our transition to a new shared service provider and investments in our stand-alone public company infrastructure. Nevertheless, our non-GAAP earnings estimate for the full year has been raised to $2.38 to $2.42 per share," Mr. Golsby noted.
Third Quarter Results
Net sales for the quarter ended Sept. 30, 2010, totaled $810.2 million, up 16 percent from $699.8 million a year ago. Sales benefited 12 percent from volume, 3 percent from price and 1 percent from foreign exchange. Earnings before interest and income taxes (EBIT) for the third quarter totaled $165.5 million, up from $159.7 million a year earlier. Net earnings attributable to shareholders totaled $106.1 million, or $0.52 per diluted share, compared with $97.6 million, or $0.48 per diluted share for the prior-year quarter.
The increase in EBIT in the third quarter of 2010 was driven by higher sales, partially offset by higher commodity and manufacturing costs, increased demand creation spending, a non-cash pension settlement, costs related to building a stand-alone company infrastructure and $19.3 million of specified costs, primarily related to the separation from Bristol-Myers Squibb's IT platform. The third quarter of 2010 also benefited from significantly lower interest expense as a result of the debt refinancing completed in the fourth quarter of 2009, partially offset by higher taxes. Results for the third quarter of 2009 included $15.9 million of specified costs.
On a non-GAAP basis, which excludes specified items, net earnings attributable to shareholders totaled $117.8 million, or $0.57 per diluted share, for the third quarter of 2010, compared with $107.7 million, or $0.53 per diluted share, for the same quarter a year ago.
Third Quarter Segment Results
The Asia/Latin America segment had net sales of $489.7 million for the third quarter of 2010, up 18 percent from $413.8 million in 2009. Sales benefited 11 percent from volume, 5 percent from price and 2 percent from foreign exchange. EBIT totaled $168.0 million, up 17 percent compared with $143.7 million for the year-ago quarter. The increase in EBIT was due to strong sales primarily due to market growth and share gains driven by higher demand-generation investments in advertising and promotion and sales force additions in support of strategic growth initiatives, primarily in China and other selected emerging markets.
The North America/Europe segment reported net sales of $320.5 million for the third quarter of 2010, up 12 percent from $286.0 million in 2009. Sales benefited 13 percent from volume, offset by a 1 percent reduction from foreign exchange. The increase in sales was primarily due to the timing of changes in customer inventories. The company's launch of Enfamil Premium in the United States led to a retail inventory build in the second quarter of 2009, which reversed in the third quarter as retailers adjusted inventories to more normal levels. In the third quarter of 2009, Mead Johnson began reducing inventories in Europe from the high levels carried by Bristol-Myers Squibb, its regional distributor. Excluding the inventory changes, sales in the third quarter of 2010 increased in the low-single digits. Sales in the United States benefited from market share gains from new product introductions, partially offset by a market contraction primarily due to a lower birth rate. Sales benefited marginally from increased demand when a competitor commenced a recall of certain infant formula products in the United States in the last days of the quarter. EBIT totaled $97.4 million, compared with $90.3 million in the third quarter a year ago. The increase was principally the result of higher sales, partially offset by increased commodity and manufacturing costs.
Nine-Month Results
Net sales for the nine months ended Sept. 30, 2010, totaled $2,337.9 million, up 11 percent from $2,112.1 million a year ago. Sales benefited 5 percent from volume, 4 percent from price, and 2 percent from foreign exchange. EBIT for the first three quarters of 2010 totaled $536.3 million, down from $566.6 million a year earlier. Net earnings attributable to shareholders for the first nine months of 2010 totaled $353.1 million, or $1.72 per diluted share, compared with $335.6 million, or $1.68 per diluted share for the prior-year period.
The first three quarters of 2010 benefited from lower interest expense and taxes, which were offset by higher commodity and manufacturing costs, demand creation investments, including advertising and promotion and sales force additions, stand-alone company costs, and $43.3 million of specified items primarily for IT separation costs. Results for 2009 include $48.8 million of specified items primarily for costs associated with the company's IPO and IT separation projects, partially offset by a $10.0 million gain from a patent settlement in the first quarter and an $11.9 million gain on an asset sale in the second quarter.
On a non-GAAP basis, which excludes specified items, net earnings attributable to shareholders totaled $381.7 million, or $1.86 per diluted share, for the first three quarters of 2010, compared with $356.9 million, or $1.74 per diluted share, for the same period a year ago.
Nine-Month Segment Results
The Asia/Latin America segment had net sales of $1,417.4 million for the first three quarters of 2010, up 18 percent from $1,200.1 million in 2009. Sales benefited 9 percent from volume, 6 percent from price and 3 percent from foreign exchange. Segment EBIT totaled $492.0 million, up 12 percent compared with $438.5 million for the year-ago period. The increase in sales came from market growth and share gains driven by increased investments in advertising and promotion and sales force in support of strategic growth initiatives. Double-digit constant-dollar sales growth was reported in the majority of the company's largest markets.
The North America/Europe segment reported net sales of $920.5 million for the first three quarters of 2010, up from $912.0 million in 2009. Sales benefited 1 percent from price and 1 percent from foreign exchange, offset by a 1 percent decline in volume. EBIT totaled $272.7 million, compared with $310.5 million in the same period a year ago. The decrease was primarily due to a lower gross margin driven by higher commodity and manufacturing costs, and increased advertising and promotion spending.
Conference Call Scheduled
The company will host a conference call at 8:30 a.m. CDT today during which company executives will review third quarter financial results and respond to questions from analysts and investors. The call will be broadcast over the Internet at meadjohnson.com. To listen to the call, go to the Web site at least 15 minutes before the call and click on the Investors tab. Security analysts and investors wishing to participate by telephone should call 1-866-786-2141, pass code: Mead Johnson. Callers outside of North America should call +1-857-350-1600 to be connected. A replay of the conference call will be available through midnight EDT Thursday, Nov. 4, 2010, by calling 1-888-286-8010 or +1-617-801-6888, pass code: 38930977. 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 statements, which are identified by words such as "expects," "intends" and "believes," involve certain risks and uncertainties 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 adverse effect of commodity price increases; (4) increased competition from branded, private label, store and economy-branded products; (5) the effect of an economic downturn on consumers' purchasing behavior and customers' ability to pay for product; (6) inventory reductions by customers; (7) the adverse effect of changes in foreign currency exchange rates; (8) legislative, regulatory or judicial action that may adversely affect the company's ability to advertise its products or maintain product margins; (9) the possibility of changes in the Women, Infant and Children (WIC) program, or increases in levels of participation in WIC; (10) business disruption due to a systems failure during the transition and separation from Bristol-Myers Squibb's IT platform; and (11) the ability to develop and market new, innovative products. For additional information on these and other factors, see the risk factors identified in the company's periodic reports, including the annual report on Form 10-K for 2009, quarterly reports on Form 10-Q and current reports on Form 8-K, filed with, or furnished to, the Securities and Exchange Commission, available upon request or at meadjohnson.com. 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 60 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(R) infant formula, is the world's leading brand franchise in pediatric nutrition. For more information, go to meadjohnson.com.
|
MEAD JOHNSON NUTRITION COMPANY |
||||||||||||
|
CONSOLIDATED STATEMENTS OF EARNINGS |
||||||||||||
|
(Dollars and shares in millions, except per share data) |
||||||||||||
|
(UNAUDITED) |
||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||
| NET SALES | $ | 810.2 | $ | 699.8 | $ | 2,337.9 | $ | 2,112.1 | ||||
| COST OF PRODUCTS SOLD | 296.3 | 244.6 | 846.8 | 728.3 | ||||||||
| GROSS PROFIT | 513.9 | 455.2 | 1,491.1 | 1,383.8 | ||||||||
| EXPENSES: | ||||||||||||
| SELLING, GENERAL AND ADMINISTRATIVE | 190.2 | 164.0 | 544.2 | 482.2 | ||||||||
| ADVERTISING AND PRODUCT PROMOTION | 112.4 | 105.2 | 326.7 | 282.7 | ||||||||
| RESEARCH AND DEVELOPMENT | 18.5 | 17.6 | 58.3 | 51.3 | ||||||||
| OTHER EXPENSES/(INCOME)--NET | 27.3 | 8.7 | 25.6 | 1.0 | ||||||||
| EARNINGS BEFORE INTEREST AND INCOME TAXES | 165.5 | 159.7 | 536.3 | 566.6 | ||||||||
| INTEREST EXPENSE--NET | 12.0 | 23.0 | 35.7 | 75.3 | ||||||||
| EARNINGS BEFORE INCOME TAXES | 153.5 | 136.7 | 500.6 | 491.3 | ||||||||
| PROVISION FOR INCOME TAXES | 46.1 | 37.9 | 143.2 | 147.9 | ||||||||
| NET EARNINGS | 107.4 | 98.8 | 357.4 | 343.4 | ||||||||
| Less: Net Earnings attributable to noncontrolling interests | 1.3 | 1.2 | 4.3 | 7.8 | ||||||||
| NET EARNINGS ATTRIBUTABLE TO SHAREHOLDERS | $ | 106.1 | $ | 97.6 | $ | 353.1 | $ | 335.6 | ||||
| Earnings per Share - Basic | ||||||||||||
| Net Earnings attributable to shareholders | $ | 0.52 | $ | 0.48 | $ | 1.72 | $ | 1.68 | ||||
| Earnings per Share - Diluted | ||||||||||||
| Net Earnings attributable to shareholders | $ | 0.52 | $ | 0.48 | $ | 1.72 | $ | 1.68 | ||||
| Weighted Average Shares | 204.6 | 204.5 | 204.5 | 199.3 | ||||||||
| Dividends declared per Share | $ | 0.225 | $ | 0.20 | $ | 0.675 | $ | 0.50 | ||||
|
MEAD JOHNSON NUTRITION COMPANY |
||||||||
|
CONSOLIDATED BALANCE SHEETS |
||||||||
|
(Dollars and shares in millions, except per share data) |
||||||||
|
(UNAUDITED) |
||||||||
| September 30, 2010 | December 31, 2009 | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS: | ||||||||
| Cash and Cash Equivalents | $ | 501.9 | $ | 561.1 | ||||
| Receivables--net of allowances of $6.5 and $6.2, respectively | 360.3 | 317.6 | ||||||
| Note Receivable | -- | 30.0 | ||||||
| Inventories | 345.1 | 309.9 | ||||||
| Deferred Income Taxes--net of valuation allowance | 91.2 | 89.4 | ||||||
| Income Taxes Receivable | 15.3 | 5.6 | ||||||
| Prepaid Expenses and Other Assets | 37.7 | 22.5 | ||||||
| Total Current Assets | 1,351.5 | 1,336.1 | ||||||
| Property, Plant and Equipment--net | 544.9 | 501.4 | ||||||
| Goodwill | 117.5 | 117.5 | ||||||
| Other Intangible Assets--net | 76.5 | 50.5 | ||||||
| Deferred Income Taxes--net of valuation allowance | 15.8 | 16.0 | ||||||
| Other Assets | 111.4 | 48.8 | ||||||
| TOTAL | $ | 2,217.6 | $ | 2,070.3 | ||||
| LIABILITIES AND EQUITY (DEFICIT) | ||||||||
| CURRENT LIABILITIES: | ||||||||
| Short-Term Borrowings | $ | 3.2 | $ | 120.0 | ||||
| Accounts Payable | 349.5 | 361.3 | ||||||
| Dividends Payable | 46.3 | 41.0 | ||||||
| Accrued Expenses | 207.9 | 206.6 | ||||||
| Accrued Rebates and Returns | 263.7 | 268.2 | ||||||
| Deferred Income--current | 26.1 | 19.9 | ||||||
| Income Taxes--payable and deferred | 40.3 | 83.2 | ||||||
| Total Current Liabilities | 937.0 | 1,100.2 | ||||||
| Long-Term Debt | 1,548.4 | 1,484.9 | ||||||
| Deferred Income--noncurrent | 2.1 | 2.8 | ||||||
| Deferred Income Taxes--noncurrent | 28.7 | 5.1 | ||||||
| Pension, Post Retirement and Post Employment Liabilities | 94.7 | 123.6 | ||||||
| Other Liabilities | 22.4 | 18.0 | ||||||
| Total Liabilities | 2,633.3 | 2,734.6 | ||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||
| EQUITY (DEFICIT): | ||||||||
| Shareholders' Equity: | ||||||||
| Common Stock, $0.01 par value: 4,200 authorized, 204.6 and 204.5 issued and outstanding, respectively | 2.0 | 2.0 | ||||||
| Additional Paid-in (Distributed) Capital | (781.7 | ) | (797.4 | ) | ||||
| Retained Earnings | 420.4 | 206.1 | ||||||
| Treasury Stock--at cost | (0.2 | ) | -- | |||||
| Accumulated Other Comprehensive Income (Loss) | (64.4 | ) | (85.6 | ) | ||||
| Total Shareholders' Equity (Deficit) | (423.9 | ) | (674.9 | ) | ||||
| Noncontrolling Interests | 8.2 | 10.6 | ||||||
| Total Equity (Deficit) | (415.7 | ) | (664.3 | ) | ||||
| TOTAL | $ | 2,217.6 | $ | 2,070.3 | ||||
|
MEAD JOHNSON NUTRITION COMPANY |
||||||||
|
CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
|
(Dollars in millions) |
||||||||
|
(UNAUDITED) |
||||||||
| Nine Months Ended September 30, | ||||||||
| 2010 | 2009 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net Earnings | $ | 357.4 | $ | 343.4 | ||||
| Adjustments to Reconcile Net Earnings to Net Cash Provided by Operating Activities: | ||||||||
| Depreciation and Amortization | 47.4 | 43.9 | ||||||
| Changes in Assets and Liabilities | (43.8 | ) | 47.2 | |||||
| Pension and Other Post Retirement Benefits Contributions | (35.0 | ) | (26.3 | ) | ||||
| Other | 22.9 | 8.5 | ||||||
| Net Cash Provided by Operating Activities | 348.9 | 416.7 | ||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Payments for Capital Expenditures | (142.3 | ) | (59.3 | ) | ||||
| Proceeds from Sale of Property, Plant and Equipment | 2.2 | 1.6 | ||||||
| Proceeds from Sale of Intangible Asset | -- | 11.9 | ||||||
| Investment in Other Companies | (5.5 | ) | -- | |||||
| Net Cash Used in Investing Activities | (145.6 | ) | (45.8 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Proceeds from Short-Term Borrowings | 103.2 | -- | ||||||
| Repayments of Short-Term Borrowings | (220.0 | ) | -- | |||||
| Payment for Capital Lease Termination | (47.0 | ) | -- | |||||
| Proceeds from Promissory Note from BMS | 30.0 | -- | ||||||
| Cash Dividends Paid | (133.4 | ) | (61.4 | ) | ||||
| Issuance of Stock for Stock-Based Compensation | 1.6 | -- | ||||||
| Treasury Stock Purchases | (0.2 | ) | -- | |||||
| Proceeds from Initial Public Offering, net of offering costs | -- | 782.3 | ||||||
| Repayment of Related-Party Debt and Lease | -- | (602.8 | ) | |||||
| Net Transfers from BMS, excluding noncash items | -- | 97.7 | ||||||
| Distributions to Noncontrolling Interests | -- | (1.5 | ) | |||||
| Net Cash Provided by (Used in) Financing Activities | (265.8 | ) | 214.3 | |||||
| Effects of Changes in Exchange Rates on Cash and Cash Equivalents | 3.3 | 12.2 | ||||||
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | (59.2 | ) | 597.4 | |||||
| CASH AND CASH EQUIVALENTS: | ||||||||
| Beginning of Period | 561.1 | -- | ||||||
| End of Period | $ | 501.9 | $ | 597.4 | ||||
| MEAD JOHNSON NUTRITION COMPANY | ||||||||||||||||||||
| SUPPLEMENTAL FINANCIAL INFORMATION | ||||||||||||||||||||
| (Dollars in millions) | ||||||||||||||||||||
| (UNAUDITED) | ||||||||||||||||||||
| % Change Due to | ||||||||||||||||||||
| Three Months Ended September 30, | Foreign | |||||||||||||||||||
| 2010 | 2009 | % Change | Volume | Price | Exchange | |||||||||||||||
| Net Sales | ||||||||||||||||||||
| Asia/Latin America | $ | 489.7 | $ | 413.8 | 18 | % | 11 | % | 5 | % | 2 | % | ||||||||
| North America/Europe | 320.5 | 286.0 | 12 | % | 13 | % | 0 | % | -1 | % | ||||||||||
| Total | $ | 810.2 | $ | 699.8 | 16 | % | 12 | % | 3 | % | 1 | % | ||||||||
| Earnings Before Interest and Income Taxes | ||||||||||||||||||||
| Asia/Latin America | $ | 168.0 | $ | 143.7 | 17 | % | ||||||||||||||
| North America/Europe | 97.4 | 90.3 | 8 | % | ||||||||||||||||
| Corporate and Other | (99.9 | ) | (74.3 | ) | 34 | % | ||||||||||||||
| Total | $ | 165.5 | $ | 159.7 | 4 | % | ||||||||||||||
| MEAD JOHNSON NUTRITION COMPANY | ||||||||||||||||||||
| SUPPLEMENTAL FINANCIAL INFORMATION | ||||||||||||||||||||
| (Dollars in millions) | ||||||||||||||||||||
| (UNAUDITED) | ||||||||||||||||||||
| % Change Due to | ||||||||||||||||||||
| Nine Months Ended September 30, | Foreign | |||||||||||||||||||
| 2010 | 2009 | % Change | Volume | Price | Exchange | |||||||||||||||
| Net Sales | ||||||||||||||||||||
| Asia/Latin America | $ | 1,417.4 | $ | 1,200.1 | 18 | % | 9 | % | 6 | % | 3 | % | ||||||||
| North America/Europe | 920.5 | 912.0 | 1 | % | -1 | % | 1 | % | 1 | % | ||||||||||
| Total | $ | 2,337.9 | $ | 2,112.1 | 11 | % | 5 | % | 4 | % | 2 | % | ||||||||
| Earnings Before Interest and Income Taxes | ||||||||||||||||||||
| Asia/Latin America | $ | 492.0 | $ | 438.5 | 12 | % | ||||||||||||||
| North America/Europe | 272.7 | 310.5 | -12 | % | ||||||||||||||||
| Corporate and Other | (228.4 | ) | (182.4 | ) | 25 | % | ||||||||||||||
| Total | $ | 536.3 | $ | 566.6 | -5 | % | ||||||||||||||
Non-GAAP Financial Measures
This news release contains non-GAAP financial measures, including non-GAAP EBIT, earnings and earnings per share information. The items included in GAAP measures, but excluded for the purpose of determining non-GAAP EBIT, earnings and earnings per share, are IT separation, initial public offering (IPO) and other costs (Specified Items). In addition, other items include the tax impact on Specified Items, and the number of shares outstanding in 2009 to reflect the increase in shares due to the IPO. Non-GAAP EBIT, earnings and earnings per share information adjusted for these items is an indication of the company's underlying operating results and 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 GAAP to non-GAAP disclosure follow:
| MEAD JOHNSON NUTRITION COMPANY | |||||||||||||||||||||||
| RECONCILIATION OF GAAP TO NON-GAAP RESULTS | |||||||||||||||||||||||
| FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2010 and 2009 | |||||||||||||||||||||||
| (Dollars in millions, except per share data) | |||||||||||||||||||||||
| (UNAUDITED) | |||||||||||||||||||||||
|
Earnings Before Interest |
Net Earnings attributable |
Earnings per common |
|||||||||||||||||||||
| 2010 | 2009 | 2010 | 2009 | 2010 | 2009 | ||||||||||||||||||
| GAAP results | $ | 165.5 | $ | 159.7 | $ | 106.1 | $ | 97.6 | $ | 0.52 | $ | 0.48 | |||||||||||
| Specified Items:(1) | |||||||||||||||||||||||
| IT and other separation costs(2) | 14.0 | 5.1 | |||||||||||||||||||||
| Severance and related costs(3) | 4.3 | 3.4 | |||||||||||||||||||||
| Legal, settlements and related costs(2,3) | 1.0 | 5.3 | |||||||||||||||||||||
| IPO-related costs(2) | - | 2.1 | |||||||||||||||||||||
| Specified Items before income taxes | 19.3 | 15.9 | 19.3 | 15.9 | 0.09 | 0.08 | |||||||||||||||||
| Income tax impact on items above | (7.3 | ) | (5.8 | ) | (0.04 | ) | (0.03 | ) | |||||||||||||||
| Write-off of deferred tax asset related to BMS stock options | (0.3 | ) | - | - | - | ||||||||||||||||||
| Non-GAAP results | $ | 184.8 | $ | 175.6 | $ | 117.8 | $ | 107.7 | $ | 0.57 | $ | 0.53 | |||||||||||
| (1)All Specified Items are included in the Corporate and Other segment | |||||||||||||||||||||||
| (2)Included in Selling, General and Administrative expenses | |||||||||||||||||||||||
| (3)Included in Other Expenses/(Income)-net | |||||||||||||||||||||||
| MEAD JOHNSON NUTRITION COMPANY | |||||||||||||||||||||||
| RECONCILIATION OF GAAP TO NON-GAAP RESULTS | |||||||||||||||||||||||
| FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2010 and 2009 | |||||||||||||||||||||||
| (Dollars in millions, except per share data) | |||||||||||||||||||||||
| (UNAUDITED) | |||||||||||||||||||||||
|
Earnings Before Interest |
Net Earnings attributable |
Earnings per common |
|||||||||||||||||||||
| 2010 | 2009 | 2010 | 2009 | 2010 | 2009 | ||||||||||||||||||
| GAAP results | $ | 536.3 | $ | 566.6 | $ | 353.1 | $ | 335.6 | $ | 1.72 | $ | 1.68 | |||||||||||
| Specified Items:(1) | |||||||||||||||||||||||
| IT and other separation costs(2) | 33.9 | 9.4 | |||||||||||||||||||||
| Severance and related costs(3) | 4.8 | 12.2 | |||||||||||||||||||||
| Legal, settlements and related costs(2,3) | 4.6 | (4.7 | ) | ||||||||||||||||||||
| IPO-related costs(2) | - | 21.9 | |||||||||||||||||||||
| Gain on asset sale(3) | - | (11.9 | ) | ||||||||||||||||||||
| Specified Items before income taxes | 43.3 | 26.9 | 43.3 | 26.9 | 0.21 | 0.13 | |||||||||||||||||
| Income tax impact on items above | (15.6 | ) | (5.6 | ) | (0.08 | ) | (0.03 | ) | |||||||||||||||
| Write-off of deferred tax asset related to BMS stock options | 0.9 | - | 0.01 | - | |||||||||||||||||||
| Effect of newly issued shares(4) | - | (0.04 | ) | ||||||||||||||||||||
| Non-GAAP results | $ | 579.6 | $ | 593.5 | $ | 381.7 | $ | 356.9 | $ | 1.86 | $ | 1.74 | |||||||||||
| (1)All Specified Items are included in the Corporate and Other segment | |||||||||||||||||||||||
| (2)Included in Selling, General and Administrative expenses | |||||||||||||||||||||||
| (3)Included in Other Expenses/(Income)-net | |||||||||||||||||||||||
| (4)Prior to Feb. 10, 2009, there were 170.0 million shares of common stock outstanding. The company issued an additional 34.5 million shares of common stock in the IPO. | |||||||||||||||||||||||
SOURCE: Mead Johnson Nutrition Company
Mead Johnson Nutrition CompanyInvestors:
Kathryn Chieger, (847) 832-2419
kathryn.chieger@mjn.com
or
Media:
Christopher Perille, (847) 832-2178
chris.perille@mjn.com
10/28/2010