Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 28, 2017 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Kraft Heinz Co | |
Entity Central Index Key | 1,637,459 | |
Current Fiscal Year End Date | --12-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 1,218,467,836 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Income Statement [Abstract] | ||||
Net sales | $ 6,314 | $ 6,267 | $ 19,355 | $ 19,630 |
Cost of products sold | 4,000 | 4,049 | 12,059 | 12,503 |
Gross profit | 2,314 | 2,218 | 7,296 | 7,127 |
Selling, general and administrative expenses | 653 | 805 | 2,163 | 2,565 |
Operating income | 1,661 | 1,413 | 5,133 | 4,562 |
Interest expense | 306 | 311 | 926 | 824 |
Other expense/(income), net | (4) | (3) | 8 | (5) |
Income/(loss) before income taxes | 1,359 | 1,105 | 4,199 | 3,743 |
Provision for/(benefit from) income taxes | 416 | 262 | 1,205 | 1,045 |
Net income/(loss) | 943 | 843 | 2,994 | 2,698 |
Net income/(loss) attributable to noncontrolling interest | (1) | 1 | (2) | 10 |
Net income/(loss) attributable to Kraft Heinz | 944 | 842 | 2,996 | 2,688 |
Preferred dividends | 0 | 0 | 0 | 180 |
Net income/(loss) attributable to common shareholders | $ 944 | $ 842 | $ 2,996 | $ 2,508 |
Earnings Per Share [Abstract] | ||||
Basic earnings/(loss) per share (in dollars per share) | $ 0.78 | $ 0.69 | $ 2.46 | $ 2.06 |
Diluted earnings/(loss) per share (in dollars per share) | 0.77 | 0.69 | 2.44 | 2.05 |
Dividends declared (in dollars per share) | $ 0.625 | $ 0.6 | $ 1.825 | $ 1.75 |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income/(loss) | $ 943 | $ 843 | $ 2,994 | $ 2,698 |
Other comprehensive income/(loss), net of tax: | ||||
Foreign currency translation adjustments | 421 | (148) | 1,179 | (294) |
Net deferred gains/(losses) on net investment hedges | (124) | 34 | (327) | 79 |
Net actuarial gains/(losses) arising during the period | (4) | (251) | (13) | (251) |
Prior service credits/(costs) arising during the period | 0 | 106 | 1 | 106 |
Reclassification of net postemployment benefit losses/(gains) | (51) | (39) | (260) | (143) |
Net deferred gains/(losses) on cash flow hedges | (70) | 31 | (136) | (1) |
Net deferred losses/(gains) on cash flow hedges reclassified to net income | 51 | (26) | 97 | (44) |
Total other comprehensive income/(loss) | 223 | (293) | 541 | (548) |
Total comprehensive income/(loss) | 1,166 | 550 | 3,535 | 2,150 |
Comprehensive income/(loss) attributable to noncontrolling interest | (1) | 3 | (4) | 19 |
Comprehensive income/(loss) attributable to Kraft Heinz | $ 1,167 | $ 547 | $ 3,539 | $ 2,131 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
ASSETS | ||
Cash and cash equivalents | $ 1,441 | $ 4,204 |
Trade receivables (net of allowances of $29 at September 30, 2017 and $20 at December 31, 2016) | 938 | 769 |
Sold receivables | 427 | 129 |
Inventories | 3,188 | 2,684 |
Other current assets | 1,234 | 967 |
Total current assets | 7,228 | 8,753 |
Property, plant and equipment, net | 6,934 | 6,688 |
Goodwill | 44,858 | 44,125 |
Intangible assets, net | 59,500 | 59,297 |
Other assets | 1,531 | 1,617 |
TOTAL ASSETS | 120,051 | 120,480 |
LIABILITIES AND EQUITY | ||
Commercial paper and other short-term debt | 455 | 645 |
Current portion of long-term debt | 2,755 | 2,046 |
Trade payables | 3,947 | 3,996 |
Accrued marketing | 493 | 749 |
Accrued postemployment costs | 158 | 157 |
Income taxes payable | 169 | 255 |
Interest payable | 295 | 415 |
Other current liabilities | 1,115 | 1,238 |
Total current liabilities | 9,387 | 9,501 |
Long-term debt | 28,299 | 29,713 |
Deferred income taxes | 20,898 | 20,848 |
Accrued postemployment costs | 1,808 | 2,038 |
Other liabilities | 688 | 806 |
TOTAL LIABILITIES | 61,080 | 62,906 |
Commitments and Contingencies (Note 13) | ||
Equity: | ||
Common stock, $0.01 par value (5,000 shares authorized; 1,221 shares issued and 1,218 shares outstanding at September 30, 2017; 1,219 shares issued and 1,217 shares outstanding at December 31, 2016) | 12 | 12 |
Additional paid-in capital | 58,695 | 58,593 |
Retained earnings/(deficit) | 1,360 | 588 |
Accumulated other comprehensive income/(losses) | (1,085) | (1,628) |
Treasury stock, at cost (3 shares at September 30, 2017 and 2 shares at December 31, 2016) | (223) | (207) |
Total shareholders' equity | 58,759 | 57,358 |
Noncontrolling interest | 212 | 216 |
TOTAL EQUITY | 58,971 | 57,574 |
TOTAL LIABILITIES AND EQUITY | $ 120,051 | $ 120,480 |
Condensed Consolidated Balance5
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Millions, $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Trade receivables, allowances | $ 29 | $ 20 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 0 | 0 |
Common stock, shares issued | 0 | 0 |
Common stock, shares outstanding | 0 | 0 |
Treasury stock | 0 | 0 |
Condensed Consolidated Stateme6
Condensed Consolidated Statement of Equity - 9 months ended Sep. 30, 2017 - USD ($) $ in Millions | Total | Common Stock | Additional Paid-in Capital | Retained Earnings/(Deficit) | Accumulated Other Comprehensive Income/(Losses) | Treasury Stock | Noncontrolling Interest |
Beginning balance at Dec. 31, 2016 | $ 57,574 | $ 12 | $ 58,593 | $ 588 | $ (1,628) | $ (207) | $ 216 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income/(loss) | 2,994 | 2,996 | (2) | ||||
Other comprehensive income/(loss) | 541 | 543 | (2) | ||||
Dividends declared-common stock | (2,225) | (2,225) | |||||
Exercise of stock options, issuance of other stock awards, and other | 87 | 102 | 1 | (16) | |||
Ending balance at Sep. 30, 2017 | $ 58,971 | $ 12 | $ 58,695 | $ 1,360 | $ (1,085) | $ (223) | $ 212 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2017 | Oct. 02, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income/(loss) | $ 2,994 | $ 2,698 |
Adjustments to reconcile net income/(loss) to operating cash flows: | ||
Depreciation and amortization | 790 | 1,010 |
Amortization of postretirement benefit plans prior service costs/(credits) | (247) | (217) |
Equity award compensation expense | 36 | 38 |
Deferred income tax provision/(benefit) | 492 | (28) |
Pension contributions | (174) | (332) |
Other items, net | (76) | (122) |
Changes in current assets and liabilities: | ||
Trade receivables | (2,061) | (1,443) |
Inventories | (580) | (481) |
Accounts payable | 123 | 480 |
Other current assets | (137) | (58) |
Other current liabilities | (1,144) | (529) |
Net cash provided by/(used for) operating activities | 16 | 1,016 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Cash receipts on sold receivables | 1,633 | 1,850 |
Capital expenditures | (956) | (836) |
Other investing activities, net | 47 | 70 |
Net cash provided by/(used for) investing activities | 724 | 1,084 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Repayments of long-term debt | (2,636) | (74) |
Proceeds from issuance of long-term debt | 1,496 | 6,981 |
Proceeds from issuance of commercial paper | 5,495 | 4,296 |
Repayments of commercial paper | (5,709) | (3,660) |
Dividends paid-Series A Preferred Stock | 0 | (180) |
Dividends paid-common stock | (2,161) | (2,123) |
Redemption of Series A Preferred Stock | 0 | (8,320) |
Other financing activities, net | 26 | 56 |
Net cash provided by/(used for) financing activities | (3,489) | (3,024) |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 43 | (17) |
Cash, cash equivalents, and restricted cash | ||
Net increase/(decrease) | (2,706) | (941) |
Balance at beginning of period | 4,255 | 4,912 |
Balance at end of period | 1,549 | 3,971 |
Beneficial interest obtained in exchange for securitized trade receivables | $ 1,936 | $ 1,519 |
Background and Basis of Present
Background and Basis of Presentation (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Background and Basis of Presentation | Background and Basis of Presentation Basis of Presentation: Our interim condensed consolidated financial statements are unaudited. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been omitted, in accordance with the rules of the Securities and Exchange Commission (the “SEC”). In management’s opinion, these interim financial statements include all adjustments (consisting only of normal recurring adjustments) and accruals necessary to fairly state our results for the periods presented. The condensed consolidated balance sheet data at December 31, 2016 was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. You should read these statements in conjunction with our audited consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended December 31, 2016 . The results for interim periods are not necessarily indicative of future or annual results. Organization: On July 2, 2015, through a series of transactions, we consummated the merger of Kraft Foods Group, Inc. (“Kraft”) with and into a wholly-owned subsidiary of H.J. Heinz Holding Corporation (“Heinz”) (the “2015 Merger”). At the closing of the 2015 Merger, Heinz was renamed The Kraft Heinz Company (“Kraft Heinz”). Before the consummation of the 2015 Merger, Heinz was controlled by Berkshire Hathaway Inc. and 3G Global Food Holdings, L.P. (“3G Capital”), following their acquisition of H. J. Heinz Company (the “2013 Merger”) on June 7, 2013. Accounting Standards Adopted in the Current Year: In March 2016, the Financial Accounting Standards Board (the “FASB”) issued accounting standards update (“ASU”) 2016-09 related to equity-based award accounting and presentation. Under this guidance, excess tax benefits upon the exercise of share- based payment awards are recognized in our tax provision rather than within equity. Cash flows related to excess tax benefits are classified as operating activities rather than financing activities. Additionally, cash flows related to employee tax withholdings on restricted share vesting are classified as financing activities. This ASU became effective in the first quarter of 2017. We adopted the guidance related to excess tax benefits on a prospective basis. As a result, we recognized a tax benefit in our condensed consolidated statement of income of $3 million for the three months and $19 million for the nine months ended September 30, 2017 related to our excess tax benefits upon the exercise of share-based payment awards. We retrospectively adopted the guidance related to cash flow classification of employee tax withholdings on restricted share vesting. This guidance did not have a material impact on our condensed consolidated statement of cash flows for the nine months ended October 2, 2016 or on our consolidated statement of cash flows for the year ended December 31, 2016. Our equity award compensation cost continues to reflect estimated forfeitures. In August 2016, the FASB issued ASU 2016-15 related to the classification of certain cash payments and cash receipts on the statement of cash flows. This ASU provided guidance on eight specific cash flow classification matters, which must be adopted in the same period using a retrospective transition method. We early adopted this ASU in the first quarter of 2017. We now classify consideration received for beneficial interest obtained for transferring trade receivables in securitization transactions as investing activities instead of operating activities. Accordingly, we reclassified $1.9 billion of cash receipts from the payments on sold receivables (which are cash receipts on the underlying trade receivables that have already been securitized) to cash provided by investing activities (from cash provided by operating activities) for the nine months ended October 2, 2016. The related impact on our consolidated statement of cash flows for the year ended December 31, 2016 was $2.6 billion . In connection with the adoption of ASU 2016-15, we also corrected other immaterial cash flow misstatements within operating activities, which overstated the amount of beneficial interest obtained in the non-cash exchange from the securitization of trade receivables. Additionally, we now classify cash payments for debt prepayment and debt extinguishment costs as cash outflows from financing activities rather than cash outflows from operating activities, which had no impact our condensed consolidated statements of cash flows for the nine months ended October 2, 2016 or our consolidated statement of cash flows for the year ended December 31, 2016. In November 2016, the FASB issued ASU 2016-18 requiring the statement of cash flows to explain the change in restricted cash and restricted cash equivalents, in addition to cash and cash equivalents. We early adopted this ASU in the first quarter of 2017. Accordingly, we restated our cash and cash equivalents balances in the condensed consolidated statements of cash flows to include restricted cash of $51 million at December 31, 2016 , $51 million at October 2, 2016 , and $75 million at January 3, 2016 . Additionally, cash used for investing activities increased by $24 million for the nine months ended October 2, 2016 and increased by $24 million for the year ended December 31, 2016. As required by the ASU, we have provided a reconciliation from cash and cash equivalents as presented on our condensed consolidated balance sheets to cash, cash equivalents, and restricted cash as reported on our condensed consolidated statements of cash flows. See Note 3, Restricted Cash , for this reconciliation, as well as a discussion of the nature of our restricted cash balances. Recently Issued Accounting Standards: In May 2014, the FASB issued ASU 2014-09, which superseded previously existing revenue recognition guidance. Under this ASU, companies will apply a principles-based five step model to recognize revenue upon the transfer of promised goods or services to customers and in an amount that reflects the consideration for which the company expects to be entitled to in exchange for those goods or services. This ASU will be effective beginning in the first quarter of our fiscal year 2018. The ASU may be applied using a full retrospective method or a modified retrospective transition method, with a cumulative-effect adjustment as of the date of adoption. We currently expect the impact of this guidance to be immaterial to our financial statements and related disclosures. We will adopt this ASU using the full retrospective method on the first day of our fiscal year 2018. In February 2016, the FASB issued ASU 2016-02, which superseded previously existing leasing guidance. The ASU is intended to establish the principles that lessees and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flows arising from a lease. The new guidance requires lessees to reflect most leases on their balance sheets as assets and obligations. This ASU will be effective beginning in the first quarter of our fiscal year 2019. Early adoption is permitted. The new guidance must be adopted using a modified retrospective transition, and provides for certain practical expedients. While we are still evaluating the impact this ASU will have on our financial statements and related disclosures, we have completed our scoping reviews and have made progress in our assessment phase. We have identified our significant leases by geography and by asset type as well as our leasing processes which will be impacted by the new standard. We have also made progress in developing the policy elections we will make upon adoption. We expect that our financial statement disclosures will be expanded to present additional details of our leasing arrangements. At this time, we are unable to reasonably estimate the expected increase in assets and liabilities on our condensed consolidated balance sheets upon adoption. We will adopt this ASU on the first day of our fiscal year 2019. In October 2016, the FASB issued ASU 2016-16 related to the income tax accounting impacts of intra-entity transfers of assets other than inventory , such as intellectual property and property, plant and equipment. Under the new accounting guidance, current and deferred income taxes should be recognized upon transfer of the assets. Previously, recognition of current and deferred income taxes was prohibited until the asset was sold to an external party. This ASU will be effective beginning in the first quarter of our fiscal year 2018. Early adoption is permitted but must be adopted in the first interim period of the annual period for which the ASU is adopted. The new guidance must be adopted on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the adoption period. We will adopt this ASU on the first day of our fiscal year 2018. While we are still evaluating the impact of this ASU, we currently anticipate a cumulative effect adjustment to retained earnings of approximately $100 million upon adoption. In January 2017, the FASB issued ASU 2017-04 related to goodwill impairment testing. This ASU eliminates Step 2 from the goodwill impairment test. Under the new guidance, if a reporting unit’s carrying amount exceeds its fair value, the entity will record an impairment charge based on that difference. The impairment charge will be limited to the amount of goodwill allocated to that reporting unit. Previously, if the fair value of a reporting unit was lower than its carrying amount (Step 1), an entity was required to calculate any impairment charge by comparing the implied fair value of goodwill with its carrying amount (Step 2). Additionally, under the new standard, entities that have reporting units with zero or negative carrying amounts will no longer be required to perform the qualitative assessment to determine whether to perform Step 2 of the goodwill impairment test. As a result, reporting units with zero or negative carrying amounts will generally be expected to pass the simplified impairment test; however, additional disclosure will be required of those entities. This ASU will be effective beginning in the first quarter of our fiscal year 2020. Early adoption is permitted for annual and interim goodwill impairment testing dates after January 1, 2017. The new guidance must be adopted on a prospective basis. While we are still evaluating the timing of adoption, we currently do not expect this ASU to have a material impact on our financial statements and related disclosures. In March 2017, the FASB issued ASU 2017-07 related to the presentation of net periodic benefit cost (pension and postretirement cost) . This ASU will be effective beginning in the first quarter of our fiscal year 2018. Under the new guidance, the service cost component of net periodic benefit cost must be presented in the same statement of income line item as other employee compensation costs arising from services rendered by employees during the period. Other components of net periodic benefit cost must be disaggregated from the service cost component in the statements of income and must be presented outside the operating income subtotal. Additionally, only the service cost component will be eligible for capitalization in assets. The new guidance must be applied retrospectively for the statement of income presentation of service cost components and other net periodic benefit cost components and prospectively for the capitalization of service cost components. There is a practical expedient that allows us to use historical amounts disclosed in our Postemployment Benefits footnote as an estimation basis for retrospectively applying the statement of income presentation requirements. We plan to use this practical expedient when we adopt this ASU on the first day of our fiscal year 2018. The retrospective impact of adopting ASU 2017-07 in 2018 is expected to be (in millions): For the Three Months Ended For the Nine Months Ended For the Year Ended September 30, October 2, September 30, October 2, December 31, Increase/(decrease) to cost of products sold $ 109 $ 81 $ 455 $ 259 $ 373 Increase/(decrease) to selling, general and administrative expenses 14 14 63 66 93 Increase/(decrease) to operating income (a) (123 ) (95 ) (518 ) (325 ) (466 ) (a) Includes amortization of prior service costs/(credits), curtailments, special/contractual termination benefits, and certain settlements. These components of net pension and postretirement cost/(benefit) totaled approximately $(80) million for the three months and $(400) million for the nine months ended September 30, 2017 , approximately $(70) million for the three months and $(240) million for the nine months ended October 2, 2016 , and approximately $(340) million for the year ended December 31, 2016 . In August 2017, the FASB issued ASU 2017-12 related to accounting for hedging activities. This guidance will impact the accounting for our financial (i.e., foreign exchange and interest rate) and non-financial (i.e., commodity) hedging activities. Key components of this ASU that could impact us are as follows: • Grants the ability to hedge the risk associated with the change in a contractually specified component of the purchase or sale of a non-financial item instead of the total contractual price, which could allow more commodity contracts to qualify for hedge accounting; • Requires us to defer the entire change in value of the derivative, including the effective and ineffective portion, into other comprehensive income until the hedged item impacts net income. When released, the deferred hedge gains and losses, including the ineffective portion, will be recognized in the same statement of income line affected by the hedged item; • Allows us to recognize changes in the fair value of excluded components in other comprehensive income (which will be amortized into net income over the life of the derivative) or in net income in the related period; • Changes hedge effectiveness testing, including timing and allowable methods of testing; and, • Requires additional tabular disclosures in the footnotes to the financial statements. The method for adopting the revised standard is modified retrospective. This ASU will be effective beginning in the first quarter of our fiscal year 2019; however, early adoption is permitted, including in an interim period. We are currently evaluating the timing of adoption and the impact this ASU will have on our financial statements and related disclosures. |
Integration and Restructuring E
Integration and Restructuring Expenses (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Restructuring and Related Activities [Abstract] | |
Integration and Restructuring Expenses | Integration and Restructuring Expenses As part of our restructuring activities, we incur expenses that qualify as exit and disposal costs under U.S. GAAP. These include severance and employee benefit costs and other exit costs. Severance and employee benefit costs primarily relate to cash severance, non-cash severance, including accelerated equity award compensation expense, and pension and other termination benefits. Other exit costs primarily relate to lease and contract terminations. We also incur expenses that are an integral component of, and directly attributable to, our restructuring activities, which do not qualify as exit and disposal costs under U.S. GAAP. These include asset-related costs and other implementation costs. Asset-related costs primarily relate to accelerated depreciation and asset impairment charges. Other implementation costs primarily relate to start-up costs of new facilities, professional fees, asset relocation costs, and costs to exit facilities. Employee severance and other termination benefit packages are primarily determined based on established benefit arrangements, local statutory requirements, or historical benefit practices. We recognize the contractual component of these benefits when payment is probable and estimable; additional elements of severance and termination benefits associated with non-recurring benefits are recognized ratably over each employee’s required future service period. Charges for accelerated depreciation are recognized on long-lived assets that will be taken out of service before the end of their normal service, in which case depreciation estimates are revised to reflect the use of the asset over its shortened useful life. Asset impairments establish a new fair value basis for assets held for disposal or sale and those assets are written down to expected net realizable value if carrying value exceeds fair value. All other costs are recognized as incurred. Integration Program: Following the 2015 Merger, we announced a multi-year program (the “Integration Program”) designed to reduce costs, streamline and simplify our operating structure as well as optimize our production and supply chain network across our businesses in the United States and Canada segments. We expect to incur pre-tax costs of $2.1 billion related to the Integration Program. These pre-tax costs are comprised of the following categories: • Organization costs ( $400 million ) associated with our plans to streamline and simplify our operating structure, resulting in workforce reduction (primarily severance and employee benefit costs). • Footprint costs ( $1.3 billion ) associated with our plans to optimize our production and supply chain network, resulting in workforce reduction and facility closures and consolidations (primarily asset-related costs and severance and employee benefit costs). • Other costs ( $400 million ) incurred as a direct result of integration activities, including other exit costs (primarily lease and contract terminations) and other implementation costs (primarily professional services and other third-party fees). We expect that approximately 60% of the Integration Program expenses will be reflected in cost of products sold and approximately 60% will be cash expenditures. Overall, as part of the Integration Program, we expect to eliminate 5,150 positions, close net six factories, and consolidate our distribution network. At September 30, 2017 , the total Integration Program liability related primarily to the elimination of general salaried and factory positions across the United States and Canada, 4,800 of whom have left the Company by September 30, 2017 . Additionally, as of September 30, 2017 , we have closed net six factories. Related to the Integration Program, we incurred costs of $79 million for the three months and $157 million for the nine months ended September 30, 2017 and $222 million for the three months and $722 million for the nine months ended October 2, 2016 . As of September 30, 2017 , we have incurred approximately $1.9 billion of cumulative costs under the Integration Program, including $543 million of severance and employee benefit costs, $803 million of non-cash asset-related costs, $417 million of other implementation costs, and $110 million of other exit costs. In the second quarter of 2017, we recognized a curtailment gain of $168 million , which was classified as Integration Program expenses. The curtailment was triggered by the number of cumulative headcount reductions after the closure of certain U.S. factories in the second quarter of 2017. The resulting gain is attributed to accelerating a portion of the previously deferred actuarial gains and prior service credits. An additional curtailment gain of $9 million was recognized during the third quarter of 2017 based on additional employee exits associated with these factory closures. See Note 8, Postemployment Benefits , and Note 9, Accumulated Other Comprehensive Income/(Losses) , for the related curtailment gain. Our liability balance for Integration Program costs that qualify as exit and disposal costs under U.S. GAAP (i.e., severance and employee benefit costs and other exit costs), was (in millions): Severance and Employee Benefit Costs Other Exit Costs (a) Total Balance at December 31, 2016 $ 99 $ 10 $ 109 Charges/(credits) (138 ) 15 (123 ) Cash payments (55 ) (3 ) (58 ) Non-cash utilization 138 (3 ) 135 Balance at September 30, 2017 $ 44 $ 19 $ 63 (a) Other exit costs primarily consist of lease and contract terminations. We expect the liability for severance and employee benefit costs as of September 30, 2017 to be paid in 2017. The liability for other exit costs primarily relates to lease obligations associated with restructuring programs executed prior to the 2015 Merger. The cash impact of these obligations will continue for the duration of the lease terms, which expire between 2019 and 2026. Restructuring Activities: In addition to our Integration Program in North America, we have a small number of other restructuring programs globally, which are focused primarily on workforce reduction and factory closure and consolidation. Related to these programs, approximately 500 employees left the Company during the nine months ended September 30, 2017 . These programs resulted in expenses of $16 million for the three months ended September 30, 2017 , including $8 million of severance and employee benefit costs, $7 million of other implementation costs, and $1 million of other exit costs. Other restructuring program expenses for the nine months ended September 30, 2017 were $80 million , including $37 million of severance and employee benefit costs, $1 million of non-cash asset-related costs, $32 million of other implementation costs, and $10 million of other exit costs. Other restructuring program expenses totaled $15 million for the three months and $59 million for the nine months ended October 2, 2016 . Our liability balance for restructuring project costs that qualify as exit and disposal costs under U.S. GAAP (i.e., severance and employee benefit costs and other exit costs), was (in millions): Severance and Employee Benefit Costs Other Exit Costs (a) Total Balance at December 31, 2016 $ 12 $ 25 $ 37 Charges/(credits) 37 10 47 Cash payments (32 ) (6 ) (38 ) Non-cash utilization (7 ) — (7 ) Balance at September 30, 2017 $ 10 $ 29 $ 39 (a) Other exit costs primarily consist of lease and contract terminations. We expect the liability for severance and employee benefit costs as of September 30, 2017 to be paid in 2017. The liability for other exit costs primarily relates to lease obligations associated with restructuring programs executed prior to the 2015 Merger. The cash impact of these obligations will continue for the duration of the lease terms, which expire between 2017 and 2026. Total Integration and Restructuring: Total expenses related to the Integration Program and restructuring activities recorded in cost of products sold and selling, general and administrative expenses were (in millions): For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, Severance and employee benefit costs - COGS $ (22 ) $ 14 $ (139 ) $ 43 Severance and employee benefit costs - SG&A (3 ) 43 38 89 Asset-related costs - COGS 34 89 134 368 Asset-related costs - SG&A 8 9 21 35 Other costs - COGS 68 49 129 121 Other costs - SG&A 10 33 54 125 $ 95 $ 237 $ 237 $ 781 We do not include Integration Program and restructuring expenses within Segment Adjusted EBITDA (as defined in Note 15, Segment Reporting ). The pre-tax impact of allocating such expenses to our segments would have been (in millions): For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, United States $ 75 $ 161 $ 118 $ 607 Canada (3 ) 16 21 43 Europe 6 5 45 33 Rest of World — — 11 — General corporate expenses 17 55 42 98 $ 95 $ 237 $ 237 $ 781 |
Restricted Cash (Notes)
Restricted Cash (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract] | |
Restricted Cash | Restricted Cash The following table provides a reconciliation of cash and cash equivalents, as reported on our condensed consolidated balance sheets, to cash, cash equivalents, and restricted cash, as reported on our condensed consolidated statements of cash flows (in millions): September 30, 2017 December 31, 2016 Cash and cash equivalents $ 1,441 $ 4,204 Restricted cash included in other assets (current) 108 42 Restricted cash included in other assets (noncurrent) — 9 Cash, cash equivalents, and restricted cash $ 1,549 $ 4,255 Our restricted cash primarily relates to withholding taxes on our common stock dividends to our only significant international shareholder, 3G Capital. |
Inventories (Notes)
Inventories (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following (in millions): September 30, 2017 December 31, 2016 Packaging and ingredients $ 713 $ 542 Work in process 464 388 Finished product 2,011 1,754 Inventories $ 3,188 $ 2,684 The increase in inventories for the nine months ended September 30, 2017 was primarily due to seasonality in the U.S. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill: Changes in the carrying amount of goodwill, by segment, were (in millions): United States Canada Europe Rest of World Total Balance at December 31, 2016 $ 33,696 $ 4,913 $ 2,778 $ 2,738 $ 44,125 Translation adjustments and other — 379 250 104 733 Balance at September 30, 2017 $ 33,696 $ 5,292 $ 3,028 $ 2,842 $ 44,858 We test goodwill for impairment at least annually in the second quarter or when a triggering event occurs. We performed our 2017 annual impairment test as of April 2, 2017. As a result of our 2017 annual impairment test, there was no impairment of goodwill. Each of our goodwill reporting units had excess fair value over its carrying value of at least 10% as of April 2, 2017. Our goodwill balance consists of 18 reporting units and had an aggregate carrying value of $44.9 billion as of September 30, 2017 . As a majority of our goodwill was recently recorded in connection with the 2013 Merger and the 2015 Merger, representing fair values as of those merger dates, there was not a significant excess of fair values over carrying values as of April 2, 2017. We have a risk of future impairment to the extent that individual reporting unit performance does not meet our projections. Additionally, if our current assumptions and estimates, including projected revenues and income growth rates, terminal growth rates, competitive and consumer trends, market-based discount rates, and other market factors, are not met, or if valuation factors outside of our control change unfavorably, the estimated fair value of our goodwill could be adversely affected, leading to a potential impairment in the future. No events occurred during the three months ended September 30, 2017 that indicated it was more likely than not that our goodwill was impaired. There were no accumulated impairment losses to goodwill as of September 30, 2017 . Indefinite-lived intangible assets: Indefinite-lived intangible assets, which primarily consisted of trademarks, were (in millions): Balance at December 31, 2016 $ 53,307 Translation adjustments 380 Impairment losses on indefinite-lived intangible assets (48 ) Balance at September 30, 2017 $ 53,639 We test indefinite-lived intangible assets for impairment at least annually in the second quarter or when a triggering event occurs. We performed our 2017 annual impairment test as of April 2, 2017. As a result of our 2017 annual impairment test, we recognized a non-cash impairment loss of $48 million in selling, general and administrative expenses for the nine months ended September 30, 2017 . This loss was due to continued declines in nutritional beverages in India. The loss was recorded in our Europe segment as the related trademark is owned by our Italian subsidiary. Each of our other brands had excess fair value over its carrying value of at least 10% as of April 2, 2017. Our indefinite-lived intangible assets primarily consist of a large number of individual brands and had an aggregate carrying value of $53.6 billion as of September 30, 2017 . As a majority of our indefinite-lived intangible assets were recently recorded in connection with the 2013 Merger and the 2015 Merger, representing fair values as of those merger dates, there was not a significant excess of fair values over carrying values as of April 2, 2017. We have a risk of future impairment to the extent individual brand performance does not meet our projections. Additionally, if our current assumptions and estimates, including projected revenues and income growth rates, terminal growth rates, competitive and consumer trends, market-based discount rates, and other market factors, are not met, or if valuation factors outside of our control change unfavorably, the estimated fair values of our indefinite-lived intangible assets could be adversely affected, leading to potential impairments in the future. No events occurred during the three months ended September 30, 2017 that indicated it was more likely than not that our indefinite-lived intangible assets were impaired. Definite-lived intangible assets: Definite-lived intangible assets were (in millions): September 30, 2017 December 31, 2016 Gross Accumulated Amortization Net Gross Accumulated Amortization Net Trademarks $ 2,381 $ (256 ) $ 2,125 $ 2,337 $ (172 ) $ 2,165 Customer-related assets 4,230 (502 ) 3,728 4,184 (369 ) 3,815 Other 14 (6 ) 8 13 (3 ) 10 $ 6,625 $ (764 ) $ 5,861 $ 6,534 $ (544 ) $ 5,990 Amortization expense for definite-lived intangible assets was $76 million for the three months and $220 million for the nine months ended September 30, 2017 and was $66 million for the three months and $198 million for the nine months ended October 2, 2016 . Aside from amortization expense, the changes in definite-lived intangible assets from December 31, 2016 to September 30, 2017 reflect the impact of foreign currency. We estimate that amortization expense related to definite-lived intangible assets will be approximately $280 million for the next twelve months and approximately $270 million for each of the four years thereafter. |
Income Taxes (Notes)
Income Taxes (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The provision for income taxes consists of provisions for federal, state, and foreign income taxes. We operate in an international environment; accordingly, the consolidated effective tax rate is a composite rate reflecting the earnings in various locations and the applicable tax rates. Additionally, our quarterly income tax provision is determined based on our estimated full year effective tax rate, adjusted for tax attributable to infrequent or unusual items, which are recognized on a discrete period basis in the income tax provision for the period in which they occur. Our effective tax rate was 30.6% for the three months ended September 30, 2017 compared to 23.7% for the three months ended October 2, 2016 . The increase in our effective tax rate was driven by the unfavorable impact of net discrete items for the current quarter, primarily related to the impact of state tax law changes, compared to the favorable impact of foreign tax law changes and deferred tax adjustments for the three months ended October 2, 2016. Our effective tax rate was 28.7% for the nine months ended September 30, 2017 compared to 27.9% for the nine months ended October 2, 2016 . The increase in our effective tax rate was mainly driven by the unfavorable impact of a higher percentage of U.S. income reflected in our estimated full year effective tax rate for 2017 compared to 2016. |
Employees' Stock Incentive Plan
Employees' Stock Incentive Plans (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Employees' Stock Incentive Plans | Employees’ Stock Incentive Plans Our annual equity award grants and vesting occurred in the first quarter of 2017. Other off-cycle equity grants may occur throughout the year. Stock Options: Our stock option activity and related information was: Number of Stock Options Weighted Average Exercise Price Outstanding at December 31, 2016 20,560,140 $ 37.39 Granted 1,572,848 89.01 Forfeited (559,109 ) 48.13 Exercised (2,005,638 ) 32.94 Outstanding at September 30, 2017 19,568,241 41.69 The aggregate intrinsic value of stock options exercised during the period was $115 million for the nine months ended September 30, 2017 . Restricted Stock Units: Our restricted stock unit (“RSU”) activity and related information was: Number of Units Weighted Average Grant Date Fair Value (per share) Outstanding at December 31, 2016 806,744 $ 71.95 Granted 1,678,110 85.03 Forfeited (191,072 ) 82.85 Vested (136,272 ) 72.96 Outstanding at September 30, 2017 2,157,510 81.10 The aggregate fair value of RSUs that vested during the period was $12 million for the nine months ended September 30, 2017 . |
Postemployment Benefits (Notes)
Postemployment Benefits (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Retirement Benefits [Abstract] | |
Postemployment Benefits | Postemployment Benefits Pension Plans Components of Net Pension Cost/(Benefit): Net pension cost/(benefit) consisted of the following (in millions): For the Three Months Ended For the Nine Months Ended U.S. Plans Non-U.S. Plans U.S. Plans Non-U.S. Plans September 30, October 2, September 30, October 2, September 30, October 2, September 30, October 2, Service cost $ 3 $ 3 $ 5 $ 6 $ 8 $ 10 $ 13 $ 18 Interest cost 45 52 17 21 136 158 49 64 Expected return on plan assets (66 ) (73 ) (47 ) (44 ) (197 ) (221 ) (133 ) (137 ) Amortization of unrecognized losses/(gains) — — — — — — 1 — Settlements 3 26 — — 3 20 — — Special/contractual termination benefits 5 — — — 18 — 8 — Other — — (6 ) — 2 — (15 ) — Net pension cost/(benefit) $ (10 ) $ 8 $ (31 ) $ (17 ) $ (30 ) $ (33 ) $ (77 ) $ (55 ) We capitalized a portion of net pension cost/(benefit) into inventory based on our production activities. The amounts capitalized into inventory as of September 30, 2017 and October 2, 2016 are included in the table above. Employer Contributions: During the nine months ended September 30, 2017 , we contributed $150 million to our U.S. pension plans and $24 million to our non-U.S. pension plans. Based on our contribution strategy, we plan to make further contributions of approximately $5 million to our non-U.S. plans during the remainder of 2017. We do no t plan to make further contributions to our U.S. pension plans in 2017. Our actual contributions and plans may change due to many factors, including the timing of regulatory approval for the windup of certain non-U.S. pension plans, changes in tax, employee benefit, or other laws and regulations, tax deductibility, significant differences between expected and actual pension asset performance or interest rates, or other factors. Postretirement Plans Components of Net Postretirement Cost/(Benefit): Net postretirement cost/(benefit) consisted of the following (in millions): For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, Service cost $ 2 $ 3 $ 7 $ 11 Interest cost 12 13 37 43 Amortization of prior service costs/(credits) (77 ) (90 ) (250 ) (252 ) Curtailments (9 ) — (177 ) — Net postretirement cost/(benefit) $ (72 ) $ (74 ) $ (383 ) $ (198 ) We capitalized a portion of net postretirement cost/(benefit) into inventory based on our production activities. The amounts capitalized into inventory as of September 30, 2017 and October 2, 2016 are included in the table above. In the second quarter of 2017, we remeasured certain of our postretirement plans and recognized a curtailment gain of $168 million . The curtailment was triggered by the number of cumulative headcount reductions after the closure of certain U.S. factories in the second quarter of 2017. The resulting gain is attributed to accelerating a portion of the previously deferred actuarial gains and prior service credits. An additional curtailment gain of $9 million was recognized during the third quarter of 2017 based on additional employee exits associated with these factory closures. The headcount reductions and factory closures were part of our ongoing Integration Program. See Note 2, Integration and Restructuring Expenses , for additional information. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income/(Losses) (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income/(Losses) | Accumulated Other Comprehensive Income/(Losses) The components of, and changes in, accumulated other comprehensive income/(losses), net of tax, were as follows (in millions): Foreign Currency Translation Adjustments Net Postemployment Benefit Plan Adjustments Net Cash Flow Hedge Adjustments Total Balance as of December 31, 2016 $ (2,412 ) $ 772 $ 12 $ (1,628 ) Foreign currency translation adjustments 1,181 — — 1,181 Net deferred gains/(losses) on net investment hedges (327 ) — — (327 ) Net postemployment benefit gains/(losses) arising during the period — (12 ) — (12 ) Reclassification of net postemployment benefit losses/(gains) — (260 ) — (260 ) Net deferred gains/(losses) on cash flow hedges — — (136 ) (136 ) Net deferred losses/(gains) on cash flow hedges reclassified to net income — — 97 97 Total other comprehensive income/(loss) 854 (272 ) (39 ) 543 Balance as of September 30, 2017 $ (1,558 ) $ 500 $ (27 ) $ (1,085 ) Reclassification of net postemployment benefit losses/(gains) included amounts reclassified to net income and amounts reclassified into inventory (consistent with our capitalization policy). The gross amount and related tax benefit/(expense) recorded in, and associated with, each component of other comprehensive income/(loss) were as follows (in millions): For the Three Months Ended September 30, October 2, Before Tax Amount Tax Net of Tax Amount Before Tax Amount Tax Net of Tax Amount Foreign currency translation adjustments $ 421 $ — $ 421 $ (151 ) $ — $ (151 ) Net deferred gains/(losses) on net investment hedges (200 ) 76 (124 ) 34 — 34 Net actuarial gains/(losses) arising during the period (1 ) (3 ) (4 ) (405 ) 154 (251 ) Prior service credits/(costs) arising during the period — — — 172 (66 ) 106 Reclassification of net postemployment benefit losses/(gains) (83 ) 32 (51 ) (64 ) 25 (39 ) Net deferred gains/(losses) on cash flow hedges (76 ) 6 (70 ) 33 (2 ) 31 Net deferred losses/(gains) on cash flow hedges reclassified to net income 51 — 51 (23 ) (3 ) (26 ) For the Nine Months Ended September 30, October 2, Before Tax Amount Tax Net of Tax Amount Before Tax Amount Tax Net of Tax Amount Foreign currency translation adjustments $ 1,181 $ — $ 1,181 $ (304 ) $ — $ (304 ) Net deferred gains/(losses) on net investment hedges (568 ) 241 (327 ) 144 (65 ) 79 Net actuarial gains/(losses) arising during the period (11 ) (2 ) (13 ) (405 ) 154 (251 ) Prior service credits/(costs) arising during the period 2 (1 ) 1 172 (66 ) 106 Reclassification of net postemployment benefit losses/(gains) (423 ) 163 (260 ) (232 ) 89 (143 ) Net deferred gains/(losses) on cash flow hedges (147 ) 11 (136 ) (12 ) 11 (1 ) Net deferred losses/(gains) on cash flow hedges reclassified to net income 96 1 97 (43 ) (1 ) (44 ) The amounts reclassified from accumulated other comprehensive income/(losses) were as follows (in millions): Accumulated Other Comprehensive Income/(Losses) Component Reclassified from Accumulated Other Comprehensive Income/(Losses) Affected Line Item in the Statement Where Net Income/(Loss) is Presented For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, Losses/(gains) on cash flow hedges: Foreign exchange contracts $ — $ — $ — $ (3 ) Net sales Foreign exchange contracts (2 ) (1 ) (5 ) (34 ) Cost of products sold Foreign exchange contracts 52 (23 ) 98 (9 ) Other expense/(income), net Interest rate contracts 1 1 3 3 Interest expense Losses/(gains) on cash flow hedges before income taxes 51 (23 ) 96 (43 ) Losses/(gains) on cash flow hedges, income taxes — (3 ) 1 (1 ) Losses/(gains) on cash flow hedges $ 51 $ (26 ) $ 97 $ (44 ) Losses/(gains) on postemployment benefits: Amortization of unrecognized losses/(gains) $ — $ — $ 1 $ — (a) Amortization of prior service costs/(credits) (77 ) (90 ) (250 ) (252 ) (a) Settlement and curtailments losses/(gains) (6 ) 26 (174 ) 20 (a) Losses/(gains) on postemployment benefits before income taxes (83 ) (64 ) (423 ) (232 ) Losses/(gains) on postemployment benefits, income taxes 32 25 163 89 Losses/(gains) on postemployment benefits $ (51 ) $ (39 ) $ (260 ) $ (143 ) (a) These components are included in the computation of net periodic postemployment benefit costs. See Note 8, Postemployment Benefits , for additional information. In this note we have excluded activity and balances related to noncontrolling interest (which was primarily comprised of foreign currency translation adjustments) due to its insignificance. |
Financial Instruments (Notes)
Financial Instruments (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Instruments | Financial Instruments See our consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended December 31, 2016 for additional information on our overall risk management strategies, our use of derivatives, and our related accounting policies. Derivative Volume: The notional values of our derivative instruments were (in millions): Notional Amount September 30, 2017 December 31, 2016 Commodity contracts $ 332 $ 459 Foreign exchange contracts 3,753 2,997 Cross-currency contracts 2,950 3,173 Fair Value of Derivative Instruments: The fair values and the levels within the fair value hierarchy of derivative instruments recorded on the consolidated balance sheets were (in millions): September 30, 2017 Quoted Prices in Active Markets for Identical Assets and Liabilities Significant Other Observable Inputs Significant Unobservable Inputs Total Fair Value Assets Liabilities Assets Liabilities Assets Liabilities Assets Liabilities Derivatives designated as hedging instruments: Foreign exchange contracts $ — $ — $ 9 $ 103 $ — $ — $ 9 $ 103 Cross-currency contracts — — 354 — — — 354 — Derivatives not designated as hedging instruments: Commodity contracts 8 14 — 1 — — 8 15 Foreign exchange contracts — — 46 — — — 46 — Cross-currency contracts — — — — — — — — Total fair value $ 8 $ 14 $ 409 $ 104 $ — $ — $ 417 $ 118 December 31, 2016 Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value Assets Liabilities Assets Liabilities Assets Liabilities Assets Liabilities Derivatives designated as hedging instruments: Foreign exchange contracts $ — $ — $ 69 $ 13 $ — $ — $ 69 $ 13 Cross-currency contracts — — 580 36 — — 580 36 Derivatives not designated as hedging instruments: Commodity contracts 28 7 — — — — 28 7 Foreign exchange contracts — — 35 30 — — 35 30 Cross-currency contracts — — 44 — — — 44 — Total fair value $ 28 $ 7 $ 728 $ 79 $ — $ — $ 756 $ 86 Our derivative financial instruments are subject to master netting arrangements that allow for the offset of assets and liabilities in the event of default or early termination of the contract. We elect to record the gross assets and liabilities of our derivative financial instruments on the consolidated balance sheets. If the derivative financial instruments had been netted on the consolidated balance sheets, the asset and liability positions each would have been reduced by $56 million at September 30, 2017 and $67 million at December 31, 2016 . No material amounts of collateral were received or posted on our derivative assets and liabilities at September 30, 2017 . Level 1 financial assets and liabilities consist of commodity future and options contracts and are valued using quoted prices in active markets for identical assets and liabilities. Level 2 financial assets and liabilities consist of commodity forwards, foreign exchange forwards, and cross-currency swaps. Commodity forwards are valued using an income approach based on the observable market commodity index prices less the contract rate multiplied by the notional amount. Foreign exchange forwards are valued using an income approach based on observable market forward rates less the contract rate multiplied by the notional amount. Cross-currency swaps are valued based on observable market spot and swap rates. Our calculation of the fair value of financial instruments takes into consideration the risk of nonperformance, including counterparty credit risk. There have been no transfers between Levels 1, 2, and 3 in any period presented. The fair values of our derivative assets are recorded within other current assets and other assets. The fair values of our liability derivatives are recorded within other current liabilities and other liabilities. Net Investment Hedging: At September 30, 2017 , the principal amounts of foreign denominated debt designated as net investment hedges totaled €2,550 million and £400 million . At September 30, 2017 , our cross-currency swaps designated as net investment hedges consisted of: Instrument Notional (local) (in billions) Notional (USD) (in billions) Maturity Cross-currency swap £ 0.8 $ 1.4 October 2019 Cross-currency swap C$ 1.8 $ 1.6 December 2019 We also periodically enter into shorter-dated foreign exchange contracts that are designated as net investment hedges. At September 30, 2017 , we had Chinese renminbi foreign exchange contracts with an aggregate USD notional amount of $208 million . Hedge Coverage: At September 30, 2017 , we had entered into contracts designated as hedging instruments, which hedge transactions for the following durations: • foreign exchange contracts for periods not exceeding the next 18 months; and • cross-currency contracts for periods not exceeding the next 27 months. At September 30, 2017 , we had entered into contracts not designated as hedging instruments, which hedge economic risks for the following durations: • commodity contracts for periods not exceeding the next 15 months; and • foreign exchange contracts for periods not exceeding the next five months. Hedge Ineffectiveness: We record pre-tax gains or losses reclassified from accumulated other comprehensive income/(losses) due to ineffectiveness for foreign exchange contracts related to forecasted transactions in other expense/(income), net. Deferred Hedging Gains and Losses: Based on our valuation at September 30, 2017 and assuming market rates remain constant through contract maturities, we expect transfers to net income/(loss) of unrealized losses for foreign currency cash flow hedges during the next 12 months to be $21 million . Additionally, we expect transfers to net income/(loss) of unrealized losses for interest rate cash flow hedges during the next 12 months to be insignificant. Derivative Impact on the Statements of Income and Statements of Comprehensive Income: The following tables present the pre-tax effect of derivative instruments on the consolidated statements of income and statements of comprehensive income: For the Three Months Ended September 30, October 2, Commodity Contracts Foreign Exchange Cross-Currency Contracts Interest Rate Contracts Commodity Contracts Foreign Exchange Cross-Currency Contracts Interest Rate (in millions) Derivatives designated as hedging instruments: Cash flow hedges: Gains/(losses) recognized in other comprehensive income/(loss) (effective portion) $ — $ (76 ) $ — $ — $ — $ 33 $ — $ — Net investment hedges: Gains/(losses) recognized in other comprehensive income/(loss) (effective portion) — (6 ) (81 ) — — — 49 — Total gains/(losses) recognized in other comprehensive income/(loss) (effective portion) $ — $ (82 ) $ (81 ) $ — $ — $ 33 $ 49 $ — Cash flow hedges reclassified to net income/(loss): Net sales $ — $ — $ — $ — $ — $ — $ — $ — Cost of products sold (effective portion) — 2 — — — 1 — — Other expense/(income), net — (52 ) — — — 23 — — Interest expense — — — (1 ) — — — (1 ) — (50 ) — (1 ) — 24 — (1 ) Derivatives not designated as hedging instruments: Gains/(losses) on derivatives recognized in cost of products sold 4 — — — (17 ) — — — Gains/(losses) on derivatives recognized in other expense/(income), net — 27 — — — (4 ) 2 — 4 27 — — (17 ) (4 ) 2 — Total gains/(losses) recognized in statements of income $ 4 $ (23 ) $ — $ (1 ) $ (17 ) $ 20 $ 2 $ (1 ) For the Nine Months Ended September 30, October 2, Commodity Contracts Foreign Exchange Contracts Cross-Currency Contracts Interest Rate Contracts Commodity Contracts Foreign Exchange Contracts Cross-Currency Contracts Interest Rate Contracts (in millions) Derivatives designated as hedging instruments: Cash flow hedges: Gains/(losses) recognized in other comprehensive income/(loss) (effective portion) $ — $ (147 ) $ — $ — $ — $ (4 ) $ — $ (8 ) Net investment hedges: Gains/(losses) recognized in other comprehensive income/(loss) (effective portion) — (18 ) (177 ) — — 46 74 — Total gains/(losses) recognized in other comprehensive income/(loss) (effective portion) $ — $ (165 ) $ (177 ) $ — $ — $ 42 $ 74 $ (8 ) Cash flow hedges reclassified to net income/(loss): Net sales $ — $ — $ — $ — $ — $ 3 $ — $ — Cost of products sold (effective portion) — 5 — — — 34 — — Other expense/(income), net — (98 ) — — — 9 — — Interest expense — — — (3 ) — — — (3 ) — (93 ) — (3 ) — 46 — (3 ) Derivatives not designated as hedging instruments: Gains/(losses) on derivatives recognized in cost of products sold (33 ) — — — (6 ) — — — Gains/(losses) on derivatives recognized in other expense/(income), net — 55 (2 ) — — (61 ) (6 ) — (33 ) 55 (2 ) — (6 ) (61 ) (6 ) — Total gains/(losses) recognized in statements of income $ (33 ) $ (38 ) $ (2 ) $ (3 ) $ (6 ) $ (15 ) $ (6 ) $ (3 ) Related to our non-derivative, foreign denominated debt instruments designated as net investment hedges, we recognized pre-tax losses of $113 million for the three months and $373 million for the nine months ended September 30, 2017 , and we recognized a pre-tax loss of $15 million for the three months and a pre-tax gain of $24 million for the nine months ended October 2, 2016 . These amounts were recognized in other comprehensive income/(loss) for the periods then ended. |
Financing Arrangements (Notes)
Financing Arrangements (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Transfers and Servicing [Abstract] | |
Financing Arrangements | Financing Arrangements We utilize accounts receivable securitization and factoring programs (the “Programs”) globally for our working capital needs and to provide efficient liquidity. We operate these Programs such that we generally utilize the majority of the available aggregate cash consideration limits. We account for transfers of receivables pursuant to the Programs as a sale and remove them from our condensed consolidated balance sheets. Under the Programs, we generally receive cash consideration up to a certain limit and record a non-cash exchange for sold receivables for the remainder of the purchase price. We maintain a “beneficial interest,” or a right to collect cash, in the sold receivables. Cash receipts from the payments on sold receivables (which are cash receipts on the underlying trade receivables that have already been securitized in these Programs) are classified as investing activities and presented as cash receipts on sold receivables on our condensed consolidated statements of cash flows. These cash receipts represent the consideration received for beneficial interest obtained for transferring trade receivables in securitization transactions. The carrying value of trade receivables removed from our condensed consolidated balance sheets in connection with the Programs was $1.1 billion at September 30, 2017 and $1.0 billion at December 31, 2016 . The carrying value of the sold receivables, which approximated the fair value, was $427 million at September 30, 2017 and $129 million at December 31, 2016 . See Note 14, Financing Arrangements , to our consolidated financial statements for the year ended December 31, 2016 in our Annual Report on Form 10-K for additional information on the Programs. |
Venezuela - Foreign Currency an
Venezuela - Foreign Currency and Inflation (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Foreign Currency [Abstract] | |
Venezuela - Foreign Currency and Inflation | Venezuela - Foreign Currency and Inflation We apply highly inflationary accounting to the results of our Venezuelan subsidiary and include these results in our consolidated financial statements. Our results of operations in Venezuela reflect a controlled subsidiary. We continue to have sufficient currency liquidity and pricing flexibility to run our operations. However, the continuing economic uncertainty, strict labor laws, and evolving government controls over imports, prices, currency exchange, and payments present a challenging operating environment. Increased restrictions imposed by the Venezuelan government or further deterioration of the economic environment could impact our ability to control our Venezuelan operations and could lead us to deconsolidate our Venezuelan subsidiary in the future. At September 30, 2017 , there were two exchange rates legally available to us for converting Venezuelan bolivars to U.S. dollars, including: • the official exchange rate of BsF 10 per U.S. dollar available through the Sistema de Divisa Protegida (“DIPRO”), which is available for purchases and sales of essential items, including food products; and • an alternative exchange rate available through the Sistema de Divisa Complementaria (“DICOM”), which is available for all transactions not covered by DIPRO. We have had no settlements at the DIPRO rate of BsF 10 per U.S. dollar in 2017. At September 30, 2017 , we had outstanding requests of $26 million for payment of invoices for the purchase of ingredients and packaging materials for the years 2012 through 2015, all of which were requested for payment at BsF 6.30 per U.S. dollar (the official exchange rate until March 10, 2016). We have had access to U.S. dollars at DICOM rates in 2017. As of September 30, 2017 , we believe the DICOM rate is the most appropriate legally available rate at which to translate the results of our Venezuelan subsidiary. In the second quarter of 2017, the Venezuelan government implemented changes to move DICOM from a free-floating exchange format to an auction-based system. The first auction in May 2017 resulted in a new published exchange rate of BsF 2,010 per U.S. dollar. Since then, the DICOM rate has increasingly deteriorated and was BsF 3,345 at September 30, 2017 . Published DICOM rates averaged BsF 3,030 per U.S. dollar for the three months and BsF 1,707 per U.S. dollar for the nine months ended September 30, 2017 . During the nine months ended September 30, 2017 and October 2, 2016 , we remeasured the monetary assets and liabilities, as well as the operating results, of our Venezuelan subsidiary at DICOM rates. These remeasurements resulted in a nonmonetary currency devaluation loss of $3 million for the three months and $36 million for the nine months ended September 30, 2017 , and a gain of $6 million for the three months and a loss of $1 million for the nine months ended October 2, 2016 . These amounts were recorded in other expense/(income), net, in the condensed consolidated statements of income for the periods then ended. In the second quarter of 2016, we assessed the nonmonetary assets of our Venezuelan subsidiary for impairment, resulting in a $53 million loss to write down property, plant and equipment, net, and prepaid spare parts, which was recorded within cost of products sold in the condensed consolidated statements of income for the periods then ended. We continue to monitor the DICOM rate, and the nonmonetary assets supported by the underlying operations in Venezuela, for impairment. |
Commitments, Contingencies and
Commitments, Contingencies and Debt (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingencies and Debt | Commitments, Contingencies and Debt Legal Proceedings We are routinely involved in legal proceedings, claims, and governmental inquiries, inspections or investigations (“Legal Matters”) arising in the ordinary course of our business. On April 1, 2015, the Commodity Futures Trading Commission (“CFTC”) filed a formal complaint against Mondelēz International (formerly known as Kraft Foods Inc.) and Kraft in the U.S. District Court for the Northern District of Illinois, Eastern Division, related to activities involving the trading of December 2011 wheat futures contracts. The complaint alleges that Mondelēz International and Kraft (1) manipulated or attempted to manipulate the wheat markets during the fall of 2011, (2) violated position limit levels for wheat futures, and (3) engaged in non-competitive trades by trading both sides of exchange-for-physical Chicago Board of Trade wheat contracts. As previously disclosed by Kraft, these activities arose prior to the October 1, 2012 spin-off of Kraft by Mondelēz International to its shareholders and involve the business now owned and operated by Mondelēz International or its affiliates. The Separation and Distribution Agreement between Kraft and Mondelēz International, dated as of September 27, 2012, governs the allocation of liabilities between Mondelēz International and Kraft and, accordingly, Mondelēz International will predominantly bear the costs of this matter and any monetary penalties or other payments that the CFTC may impose. We do not expect this matter to have a material adverse effect on our financial condition, results of operations, or business. While we cannot predict with certainty the results of Legal Matters in which we are currently involved or may in the future be involved, we do not expect that the ultimate costs to resolve any of the Legal Matters that are currently pending will have a material adverse effect on our financial condition or results of operations. Debt Borrowing Arrangements: We had commercial paper outstanding of $443 million at September 30, 2017 and $642 million at December 31, 2016 . See Note 11, Debt , to our consolidated financial statements for the year ended December 31, 2016 in our Annual Report on Form 10-K for additional information on our borrowing arrangements. Debt Issuances: In the third quarter of 2017, Kraft Heinz Foods Company, our wholly owned operating subsidiary, issued $350 million aggregate principal amount of floating rate senior notes due 2019, $650 million aggregate principal amount of floating rate senior notes due 2021, and $500 million aggregate principal amount of floating rate senior notes due 2022 (collectively, the “New Notes”). We used the net proceeds from the New Notes primarily to repay all amounts outstanding under our $600 million senior unsecured loan facility (“Term Loan Facility”) together with accrued interest thereon, to refinance a portion of our commercial paper program, and for other general corporate purposes. The New Notes are fully and unconditionally guaranteed as to payment of principal, premium, and interest on a senior unsecured basis. Debt Issuance Costs: Debt issuance costs related to the sale of the New Notes in the third quarter of 2017 were insignificant. Debt issuance costs are reflected as a direct deduction of our long-term debt balance on the condensed consolidated balance sheets. In the second quarter of 2016, we issued long-term debt and used the proceeds to redeem all outstanding shares of our 9.00% cumulative compounding preferred stock, Series A (“Series A Preferred Stock”) on June 7, 2016. The related debt issuance costs were $52 million . Debt Repayments: In the second quarter of 2017, we repaid $2.0 billion aggregate principal amount of senior notes that matured in the period. We funded these long-term debt repayments primarily with cash on hand and our commercial paper programs. Additionally, in the third quarter of 2017, we repaid our $600 million aggregate principal amount Term Loan Facility. Fair Value of Debt: At September 30, 2017 , the aggregate fair value of our total debt was $32.9 billion as compared with a carrying value of $31.5 billion . At December 31, 2016 , the aggregate fair value of our total debt was $33.2 billion as compared with a carrying value of $32.4 billion . Our short-term debt and commercial paper had carrying values that approximated their fair values at September 30, 2017 and December 31, 2016 . We determined the fair value of our long-term debt using Level 2 inputs. Fair values are generally estimated based on quoted market prices for identical or similar instruments. Series A Preferred Stock: As noted above, in the second quarter of 2016, we redeemed all outstanding shares of our Series A Preferred Stock. We funded this redemption primarily through the issuance of long-term debt, as well as other sources of liquidity, including our commercial paper program, U.S. securitization program, and cash on hand. In connection with the redemption, all Series A Preferred Stock was canceled and automatically retired, and we no longer pay any associated dividends. |
Earnings Per Share (Notes)
Earnings Per Share (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Our earnings per common share (“EPS”) were: For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, (in millions, except per share data) Basic Earnings Per Common Share: Net income/(loss) attributable to common shareholders $ 944 $ 842 $ 2,996 $ 2,508 Weighted average shares of common stock outstanding 1,218 1,218 1,218 1,216 Net earnings/(loss) $ 0.78 $ 0.69 $ 2.46 $ 2.06 Diluted Earnings Per Common Share: Net income/(loss) attributable to common shareholders $ 944 $ 842 $ 2,996 $ 2,508 Weighted average shares of common stock outstanding 1,218 1,218 1,218 1,216 Effect of dilutive equity awards 10 10 11 10 Weighted average shares of common stock outstanding, including dilutive effect 1,228 1,228 1,229 1,226 Net earnings/(loss) $ 0.77 $ 0.69 $ 2.44 $ 2.05 We use the treasury stock method to calculate the dilutive effect of outstanding equity awards in the denominator for diluted EPS. Anti-dilutive shares were 2 million for the three months and 1 million for the nine months ended September 30, 2017 and were 1 million for the three months and 3 million for the nine months ended October 2, 2016 . |
Segment Reporting (Notes)
Segment Reporting (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting We manufacture and market food and beverage products, including condiments and sauces, cheese and dairy, meals, meats, refreshment beverages, coffee, and other grocery products, throughout the world. We manage and report our operating results through four segments. We have three reportable segments defined by geographic region: United States, Canada, and Europe. Our remaining businesses are combined and disclosed as “Rest of World”. Rest of World is comprised of two operating segments: Latin America; and Asia Pacific, Middle East, and Africa (“AMEA”). In the fourth quarter of 2016, we reorganized our segments to reflect the following: • our Russia business moved from Rest of World to the Europe segment; and • management of our Global Procurement Office moved from one of our European subsidiaries to our global headquarters, which resulted in moving the related costs from the Europe segment to general corporate expenses. These changes are reflected in all historical periods presented and did not have a material impact on our condensed consolidated financial statements. See Note 18, Segment Reporting , to our consolidated financial statements for the year ended December 31, 2016 in our Annual Report on Form 10-K for additional information related to these changes. In the third quarter of 2017, we announced our plans to reorganize certain of our international businesses to better align our global geographies. These plans include moving our Middle East and Africa businesses from the AMEA operating segment into the Europe reportable segment, forming the Europe, Middle East, and Africa (“EMEA”) operating segment. The remaining AMEA businesses will become the Asia Pacific (“APAC”) operating segment. We expect these changes to become effective on December 30, 2017. As a result, we expect to restate our Europe and Rest of World segments to reflect these changes for historical periods presented as of December 30, 2017. Management evaluates segment performance based on several factors, including net sales and segment adjusted earnings before interest, tax, depreciation, and amortization (“Segment Adjusted EBITDA”). Management uses Segment Adjusted EBITDA to evaluate segment performance and allocate resources. Segment Adjusted EBITDA is a tool that can assist management and investors in comparing our performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our underlying operations. These items include depreciation and amortization (including amortization of postretirement benefit plans prior service credits), equity award compensation expense, integration and restructuring expenses, merger costs, unrealized gains/(losses) on commodity hedges (the unrealized gains and losses are recorded in general corporate expenses until realized; once realized, the gains and losses are recorded in the applicable segment’s operating results), impairment losses, gains/(losses) on the sale of a business, and nonmonetary currency devaluation (e.g., remeasurement gains and losses). Management does not use assets by segment to evaluate performance or allocate resources. Therefore, we do not disclose assets by segment. Net sales by segment were (in millions): For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, Net sales: United States $ 4,380 $ 4,395 $ 13,566 $ 13,802 Canada 559 550 1,599 1,692 Europe 599 558 1,737 1,766 Rest of World 776 764 2,453 2,370 Total net sales $ 6,314 $ 6,267 $ 19,355 $ 19,630 Segment Adjusted EBITDA was (in millions): For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, Segment Adjusted EBITDA: United States $ 1,440 $ 1,349 $ 4,478 $ 4,360 Canada 162 148 477 491 Europe 206 191 578 592 Rest of World 149 145 475 513 General corporate expenses (28 ) (30 ) (93 ) (115 ) Depreciation and amortization (excluding integration and restructuring expenses) (165 ) (116 ) (434 ) (401 ) Integration and restructuring expenses (95 ) (237 ) (237 ) (781 ) Merger costs — (4 ) — (33 ) Unrealized gains/(losses) on commodity hedges 5 (22 ) (24 ) 23 Impairment losses (1 ) — (49 ) (53 ) Nonmonetary currency devaluation — (1 ) — (4 ) Equity award compensation expense (excluding integration and restructuring expenses) (12 ) (10 ) (38 ) (30 ) Operating income 1,661 1,413 5,133 4,562 Interest expense 306 311 926 824 Other expense/(income), net (4 ) (3 ) 8 (5 ) Income/(loss) before income taxes $ 1,359 $ 1,105 $ 4,199 $ 3,743 In the first quarter of 2017, we reorganized the products within our product categories to reflect how we manage our business. We have reflected this change for all historical periods presented. Our net sales by product category were (in millions): For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, Condiments and sauces $ 1,568 $ 1,562 $ 4,791 $ 4,886 Cheese and dairy 1,283 1,288 3,901 4,004 Ambient meals 571 577 1,695 1,726 Frozen and chilled meals 642 642 1,934 1,895 Meats and seafood 663 670 2,018 2,093 Refreshment beverages 371 368 1,180 1,218 Coffee 331 337 1,021 1,076 Infant and nutrition 176 171 575 577 Desserts, toppings and baking 220 216 649 661 Nuts and salted snacks 202 237 686 752 Other 287 199 905 742 Total net sales $ 6,314 $ 6,267 $ 19,355 $ 19,630 |
Supplemental Financial Informat
Supplemental Financial Information (Notes) | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Financial Information | Supplemental Financial Information We fully and unconditionally guarantee the notes issued by our 100% owned operating subsidiary, Kraft Heinz Foods Company. See Note 11, Debt, to our consolidated financial statements for the year ended December 31, 2016 in our Annual Report on Form 10-K for additional descriptions of these guarantees. None of our other subsidiaries guarantee these notes. Set forth below are the condensed consolidating financial statements presenting the results of operations, financial position and cash flows of Kraft Heinz (as parent guarantor), Kraft Heinz Foods Company (as subsidiary issuer of the notes), and the non-guarantor subsidiaries on a combined basis and eliminations necessary to arrive at the total reported information on a consolidated basis. This condensed consolidating financial information has been prepared and presented pursuant to the SEC Regulation S-X Rule 3-10, “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or being Registered.” This information is not intended to present the financial position, results of operations, and cash flows of the individual companies or groups of companies in accordance with U.S. GAAP. Eliminations represent adjustments to eliminate investments in subsidiaries and intercompany balances and transactions between or among the parent guarantor, subsidiary issuer, and the non-guarantor subsidiaries. The Kraft Heinz Company Condensed Consolidating Statements of Income For the Three Months Ended September 30, 2017 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated Net sales $ — $ 4,170 $ 2,286 $ (142 ) $ 6,314 Cost of products sold — 2,601 1,541 (142 ) 4,000 Gross profit — 1,569 745 — 2,314 Selling, general and administrative expenses — 155 498 — 653 Intercompany service fees and other recharges — 776 (776 ) — — Operating income — 638 1,023 — 1,661 Interest expense — 296 10 — 306 Other expense/(income), net — 23 (27 ) — (4 ) Income/(loss) before income taxes — 319 1,040 — 1,359 Provision for/(benefit from) income taxes — (11 ) 427 — 416 Equity in earnings of subsidiaries 944 614 — (1,558 ) — Net income/(loss) 944 944 613 (1,558 ) 943 Net income/(loss) attributable to noncontrolling interest — — (1 ) — (1 ) Net income/(loss) excluding noncontrolling interest $ 944 $ 944 $ 614 $ (1,558 ) $ 944 Comprehensive income/(loss) excluding noncontrolling interest $ 1,167 $ 1,167 $ 1,165 $ (2,332 ) $ 1,167 The Kraft Heinz Company Condensed Consolidating Statements of Income For the Three Months Ended October 2, 2016 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated Net sales $ — $ 4,206 $ 2,233 $ (172 ) $ 6,267 Cost of products sold — 2,700 1,521 (172 ) 4,049 Gross profit — 1,506 712 — 2,218 Selling, general and administrative expenses — 194 611 — 805 Intercompany service fees and other recharges — 795 (795 ) — — Operating income — 517 896 — 1,413 Interest expense — 294 17 — 311 Other expense/(income), net — (20 ) 17 — (3 ) Income/(loss) before income taxes — 243 862 — 1,105 Provision for/(benefit from) income taxes — (199 ) 461 — 262 Equity in earnings of subsidiaries 842 400 — (1,242 ) — Net income/(loss) 842 842 401 (1,242 ) 843 Net income/(loss) attributable to noncontrolling interest — — 1 — 1 Net income/(loss) excluding noncontrolling interest $ 842 $ 842 $ 400 $ (1,242 ) $ 842 Comprehensive income/(loss) excluding noncontrolling interest $ 547 $ 547 $ 285 $ (832 ) $ 547 The Kraft Heinz Company Condensed Consolidating Statements of Income For the Nine Months Ended September 30, 2017 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated Net sales $ — $ 12,941 $ 6,856 $ (442 ) $ 19,355 Cost of products sold — 7,825 4,676 (442 ) 12,059 Gross profit — 5,116 2,180 — 7,296 Selling, general and administrative expenses — 504 1,659 — 2,163 Intercompany service fees and other recharges — 3,205 (3,205 ) — — Operating income — 1,407 3,726 — 5,133 Interest expense — 895 31 — 926 Other expense/(income), net — (8 ) 16 — 8 Income/(loss) before income taxes — 520 3,679 — 4,199 Provision for/(benefit from) income taxes — (92 ) 1,297 — 1,205 Equity in earnings of subsidiaries 2,996 2,384 — (5,380 ) — Net income/(loss) 2,996 2,996 2,382 (5,380 ) 2,994 Net income/(loss) attributable to noncontrolling interest — — (2 ) — (2 ) Net income/(loss) excluding noncontrolling interest $ 2,996 $ 2,996 $ 2,384 $ (5,380 ) $ 2,996 Comprehensive income/(loss) excluding noncontrolling interest $ 3,539 $ 3,539 $ 4,351 $ (7,890 ) $ 3,539 The Kraft Heinz Company Condensed Consolidating Statements of Income For the Nine Months Ended October 2, 2016 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated Net sales $ — $ 13,156 $ 6,948 $ (474 ) $ 19,630 Cost of products sold — 8,273 4,704 (474 ) 12,503 Gross profit — 4,883 2,244 — 7,127 Selling, general and administrative expenses — 778 1,787 — 2,565 Intercompany service fees and other recharges — 3,320 (3,320 ) — — Operating income — 785 3,777 — 4,562 Interest expense — 782 42 — 824 Other expense/(income), net — 66 (71 ) — (5 ) Income/(loss) before income taxes — (63 ) 3,806 — 3,743 Provision for/(benefit from) income taxes — (349 ) 1,394 — 1,045 Equity in earnings of subsidiaries 2,688 2,402 — (5,090 ) — Net income/(loss) 2,688 2,688 2,412 (5,090 ) 2,698 Net income/(loss) attributable to noncontrolling interest — — 10 — 10 Net income/(loss) excluding noncontrolling interest $ 2,688 $ 2,688 $ 2,402 $ (5,090 ) $ 2,688 Comprehensive income/(loss) excluding noncontrolling interest $ 2,131 $ 2,131 $ 2,013 $ (4,144 ) $ 2,131 The Kraft Heinz Company Condensed Consolidating Balance Sheets As of September 30, 2017 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated ASSETS Cash and cash equivalents $ — $ 217 $ 1,224 $ — $ 1,441 Trade receivables — 4 934 — 938 Receivables due from affiliates 725 205 (930 ) — Dividends due from affiliates 101 — — (101 ) — Sold receivables — — 427 — 427 Inventories — 2,087 1,101 — 3,188 Short-term lending due from affiliates — 2,098 3,513 (5,611 ) — Other current assets — 3,229 391 (2,386 ) 1,234 Total current assets 101 8,360 7,795 (9,028 ) 7,228 Property, plant and equipment, net — 4,506 2,428 — 6,934 Goodwill — 11,067 33,791 — 44,858 Investments in subsidiaries 58,759 72,096 — (130,855 ) — Intangible assets, net — 3,258 56,242 — 59,500 Long-term lending due from affiliates — 1,700 2,000 (3,700 ) — Other assets — 499 1,032 — 1,531 TOTAL ASSETS $ 58,860 $ 101,486 $ 103,288 $ (143,583 ) $ 120,051 LIABILITIES AND EQUITY Commercial paper and other short-term debt $ — $ 443 $ 12 $ — $ 455 Current portion of long-term debt — 2,583 172 — 2,755 Short-term lending due to affiliates — 3,513 2,098 (5,611 ) — Trade payables — 2,324 1,623 — 3,947 Payables due to affiliates — 205 725 (930 ) — Accrued marketing — 124 369 — 493 Accrued postemployment costs — 84 74 — 158 Income taxes payable — — 2,555 (2,386 ) 169 Interest payable — 284 11 — 295 Dividends due to affiliates — 101 — (101 ) — Other current liabilities 101 497 517 — 1,115 Total current liabilities 101 10,158 8,156 (9,028 ) 9,387 Long-term debt — 27,396 903 — 28,299 Long-term borrowings due to affiliates — 2,000 1,921 (3,921 ) — Deferred income taxes — 1,368 19,530 — 20,898 Accrued postemployment costs — 1,508 300 — 1,808 Other liabilities — 297 391 — 688 TOTAL LIABILITIES 101 42,727 31,201 (12,949 ) 61,080 Total shareholders’ equity 58,759 58,759 71,875 (130,634 ) 58,759 Noncontrolling interest — — 212 — 212 TOTAL EQUITY 58,759 58,759 72,087 (130,634 ) 58,971 TOTAL LIABILITIES AND EQUITY $ 58,860 $ 101,486 $ 103,288 $ (143,583 ) $ 120,051 The Kraft Heinz Company Condensed Consolidating Balance Sheets As of December 31, 2016 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated ASSETS Cash and cash equivalents $ — $ 2,830 $ 1,374 $ — $ 4,204 Trade receivables — 12 757 — 769 Receivables due from affiliates — 712 111 (823 ) — Dividends due from affiliates 39 — — (39 ) — Sold receivables — — 129 — 129 Inventories — 1,759 925 — 2,684 Short-term lending due from affiliates — 1,722 2,956 (4,678 ) — Other current assets — 2,229 447 (1,709 ) 967 Total current assets 39 9,264 6,699 (7,249 ) 8,753 Property, plant and equipment, net — 4,447 2,241 — 6,688 Goodwill — 11,067 33,058 — 44,125 Investments in subsidiaries 57,358 70,877 — (128,235 ) — Intangible assets, net — 3,364 55,933 — 59,297 Long-term lending due from affiliates — 1,700 2,000 (3,700 ) — Other assets — 501 1,116 — 1,617 TOTAL ASSETS $ 57,397 $ 101,220 $ 101,047 $ (139,184 ) $ 120,480 LIABILITIES AND EQUITY Commercial paper and other short-term debt $ — $ 642 $ 3 $ — $ 645 Current portion of long-term debt — 2,032 14 — 2,046 Short-term lending due to affiliates — 2,956 1,722 (4,678 ) — Trade payables — 2,376 1,620 — 3,996 Payables due to affiliates — 111 712 (823 ) — Accrued marketing — 277 472 — 749 Accrued postemployment costs — 144 13 — 157 Income taxes payable — — 1,964 (1,709 ) 255 Interest payable — 401 14 — 415 Dividends due to affiliates — 39 — (39 ) — Other current liabilities 39 588 611 — 1,238 Total current liabilities 39 9,566 7,145 (7,249 ) 9,501 Long-term debt — 28,736 977 — 29,713 Long-term borrowings due to affiliates — 2,000 1,902 (3,902 ) — Deferred income taxes — 1,382 19,466 — 20,848 Accrued postemployment costs — 1,754 284 — 2,038 Other liabilities — 424 382 — 806 TOTAL LIABILITIES 39 43,862 30,156 (11,151 ) 62,906 Total shareholders’ equity 57,358 57,358 70,675 (128,033 ) 57,358 Noncontrolling interest — — 216 — 216 TOTAL EQUITY 57,358 57,358 70,891 (128,033 ) 57,574 TOTAL LIABILITIES AND EQUITY $ 57,397 $ 101,220 $ 101,047 $ (139,184 ) $ 120,480 The Kraft Heinz Company Condensed Consolidating Statements of Cash Flows For the Nine Months Ended September 30, 2017 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated CASH FLOWS FROM OPERATING ACTIVITIES Net cash provided by/(used for) operating activities $ 2,161 $ 1,185 $ (1,169 ) $ (2,161 ) $ 16 CASH FLOWS FROM INVESTING ACTIVITIES Cash receipts on sold receivables — — 1,633 — 1,633 Capital expenditures — (622 ) (334 ) — (956 ) Net proceeds from/(payments on) intercompany lending activities — 59 (267 ) 208 — Additional investments in subsidiaries (15 ) — — 15 — Other investing activities, net — 54 (7 ) — 47 Net cash provided by/(used for) investing activities (15 ) (509 ) 1,025 223 724 CASH FLOWS FROM FINANCING ACTIVITIES Repayments of long-term debt — (2,625 ) (11 ) — (2,636 ) Proceeds from issuance of long-term debt — 1,496 — — 1,496 Proceeds from issuance of commercial paper — 5,495 — — 5,495 Repayments of commercial paper — (5,709 ) — — (5,709 ) Net proceeds from/(payments on) intercompany borrowing activities — 267 (59 ) (208 ) — Dividends paid-common stock (2,161 ) (2,161 ) — 2,161 (2,161 ) Other intercompany capital stock transactions — 15 — (15 ) — Other financing activities, net 15 (6 ) 17 — 26 Net cash provided by/(used for) financing activities (2,146 ) (3,228 ) (53 ) 1,938 (3,489 ) Effect of exchange rate changes on cash, cash equivalents, and restricted cash — — 43 — 43 Cash, cash equivalents, and restricted cash: Net increase/(decrease) — (2,552 ) (154 ) — (2,706 ) Balance at beginning of period — 2,869 1,386 — 4,255 Balance at end of period $ — $ 317 $ 1,232 $ — $ 1,549 The Kraft Heinz Company Condensed Consolidating Statements of Cash Flows For the Nine Months Ended October 2, 2016 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated CASH FLOWS FROM OPERATING ACTIVITIES Net cash provided by/(used for) operating activities $ 1,636 $ 1,821 $ (805 ) $ (1,636 ) $ 1,016 CASH FLOWS FROM INVESTING ACTIVITIES Cash receipts on sold receivables — — 1,850 — 1,850 Capital expenditures — (605 ) (231 ) — (836 ) Net proceeds from/(payments on) intercompany lending activities — 565 (74 ) (491 ) — Additional investments in subsidiaries — (10 ) — 10 — Return of capital 8,987 — — (8,987 ) — Other investing activities, net — 100 (30 ) — 70 Net cash provided by/(used for) investing activities 8,987 50 1,515 (9,468 ) 1,084 CASH FLOWS FROM FINANCING ACTIVITIES Repayments of long-term debt — (69 ) (5 ) — (74 ) Proceeds from issuance of long-term debt — 6,978 3 — 6,981 Proceeds from issuance of commercial paper — 4,296 — — 4,296 Repayments of commercial paper — (3,660 ) — — (3,660 ) Net proceeds from/(payments on) intercompany borrowing activities — 74 (565 ) 491 — Dividends paid-Series A Preferred Stock (180 ) — — — (180 ) Dividends paid-common stock (2,123 ) (2,303 ) — 2,303 (2,123 ) Redemption of Series A Preferred Stock (8,320 ) — — — (8,320 ) Other intercompany capital stock transactions — (8,320 ) 10 8,310 — Other financing activities, net — 50 6 — 56 Net cash provided by/(used for) financing activities (10,623 ) (2,954 ) (551 ) 11,104 (3,024 ) Effect of exchange rate changes on cash, cash equivalents, and restricted cash — — (17 ) — (17 ) Cash, cash equivalents, and restricted cash: Net increase/(decrease) — (1,083 ) 142 — (941 ) Balance at beginning of period — 3,253 1,659 — 4,912 Balance at end of period $ — $ 2,170 $ 1,801 $ — $ 3,971 The following tables provide a reconciliation of cash and cash equivalents, as reported on our unaudited condensed consolidating balance sheets, to cash, cash equivalents, and restricted cash, as reported on our unaudited condensed consolidating statements of cash flows (in millions): September 30, 2017 Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated Cash and cash equivalents $ — $ 217 $ 1,224 $ — $ 1,441 Restricted cash included in other assets (current) — 100 8 — 108 Cash, cash equivalents, and restricted cash $ — $ 317 $ 1,232 $ — $ 1,549 December 31, 2016 Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated Cash and cash equivalents $ — $ 2,830 $ 1,374 $ — $ 4,204 Restricted cash included in other assets (current) — 39 3 — 42 Restricted cash included in other assets (noncurrent) — — 9 — 9 Cash, cash equivalents, and restricted cash $ — $ 2,869 $ 1,386 $ — $ 4,255 |
Background and Basis of Prese24
Background and Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation: Our interim condensed consolidated financial statements are unaudited. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been omitted, in accordance with the rules of the Securities and Exchange Commission (the “SEC”). In management’s opinion, these interim financial statements include all adjustments (consisting only of normal recurring adjustments) and accruals necessary to fairly state our results for the periods presented. The condensed consolidated balance sheet data at December 31, 2016 was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. You should read these statements in conjunction with our audited consolidated financial statements and related notes in our Annual Report on Form 10-K for the year ended December 31, 2016 . The results for interim periods are not necessarily indicative of future or annual results. |
New Accounting Pronouncements | Accounting Standards Adopted in the Current Year: In March 2016, the Financial Accounting Standards Board (the “FASB”) issued accounting standards update (“ASU”) 2016-09 related to equity-based award accounting and presentation. Under this guidance, excess tax benefits upon the exercise of share- based payment awards are recognized in our tax provision rather than within equity. Cash flows related to excess tax benefits are classified as operating activities rather than financing activities. Additionally, cash flows related to employee tax withholdings on restricted share vesting are classified as financing activities. This ASU became effective in the first quarter of 2017. We adopted the guidance related to excess tax benefits on a prospective basis. As a result, we recognized a tax benefit in our condensed consolidated statement of income of $3 million for the three months and $19 million for the nine months ended September 30, 2017 related to our excess tax benefits upon the exercise of share-based payment awards. We retrospectively adopted the guidance related to cash flow classification of employee tax withholdings on restricted share vesting. This guidance did not have a material impact on our condensed consolidated statement of cash flows for the nine months ended October 2, 2016 or on our consolidated statement of cash flows for the year ended December 31, 2016. Our equity award compensation cost continues to reflect estimated forfeitures. In August 2016, the FASB issued ASU 2016-15 related to the classification of certain cash payments and cash receipts on the statement of cash flows. This ASU provided guidance on eight specific cash flow classification matters, which must be adopted in the same period using a retrospective transition method. We early adopted this ASU in the first quarter of 2017. We now classify consideration received for beneficial interest obtained for transferring trade receivables in securitization transactions as investing activities instead of operating activities. Accordingly, we reclassified $1.9 billion of cash receipts from the payments on sold receivables (which are cash receipts on the underlying trade receivables that have already been securitized) to cash provided by investing activities (from cash provided by operating activities) for the nine months ended October 2, 2016. The related impact on our consolidated statement of cash flows for the year ended December 31, 2016 was $2.6 billion . In connection with the adoption of ASU 2016-15, we also corrected other immaterial cash flow misstatements within operating activities, which overstated the amount of beneficial interest obtained in the non-cash exchange from the securitization of trade receivables. Additionally, we now classify cash payments for debt prepayment and debt extinguishment costs as cash outflows from financing activities rather than cash outflows from operating activities, which had no impact our condensed consolidated statements of cash flows for the nine months ended October 2, 2016 or our consolidated statement of cash flows for the year ended December 31, 2016. In November 2016, the FASB issued ASU 2016-18 requiring the statement of cash flows to explain the change in restricted cash and restricted cash equivalents, in addition to cash and cash equivalents. We early adopted this ASU in the first quarter of 2017. Accordingly, we restated our cash and cash equivalents balances in the condensed consolidated statements of cash flows to include restricted cash of $51 million at December 31, 2016 , $51 million at October 2, 2016 , and $75 million at January 3, 2016 . Additionally, cash used for investing activities increased by $24 million for the nine months ended October 2, 2016 and increased by $24 million for the year ended December 31, 2016. As required by the ASU, we have provided a reconciliation from cash and cash equivalents as presented on our condensed consolidated balance sheets to cash, cash equivalents, and restricted cash as reported on our condensed consolidated statements of cash flows. See Note 3, Restricted Cash , for this reconciliation, as well as a discussion of the nature of our restricted cash balances. Recently Issued Accounting Standards: In May 2014, the FASB issued ASU 2014-09, which superseded previously existing revenue recognition guidance. Under this ASU, companies will apply a principles-based five step model to recognize revenue upon the transfer of promised goods or services to customers and in an amount that reflects the consideration for which the company expects to be entitled to in exchange for those goods or services. This ASU will be effective beginning in the first quarter of our fiscal year 2018. The ASU may be applied using a full retrospective method or a modified retrospective transition method, with a cumulative-effect adjustment as of the date of adoption. We currently expect the impact of this guidance to be immaterial to our financial statements and related disclosures. We will adopt this ASU using the full retrospective method on the first day of our fiscal year 2018. In February 2016, the FASB issued ASU 2016-02, which superseded previously existing leasing guidance. The ASU is intended to establish the principles that lessees and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flows arising from a lease. The new guidance requires lessees to reflect most leases on their balance sheets as assets and obligations. This ASU will be effective beginning in the first quarter of our fiscal year 2019. Early adoption is permitted. The new guidance must be adopted using a modified retrospective transition, and provides for certain practical expedients. While we are still evaluating the impact this ASU will have on our financial statements and related disclosures, we have completed our scoping reviews and have made progress in our assessment phase. We have identified our significant leases by geography and by asset type as well as our leasing processes which will be impacted by the new standard. We have also made progress in developing the policy elections we will make upon adoption. We expect that our financial statement disclosures will be expanded to present additional details of our leasing arrangements. At this time, we are unable to reasonably estimate the expected increase in assets and liabilities on our condensed consolidated balance sheets upon adoption. We will adopt this ASU on the first day of our fiscal year 2019. In October 2016, the FASB issued ASU 2016-16 related to the income tax accounting impacts of intra-entity transfers of assets other than inventory , such as intellectual property and property, plant and equipment. Under the new accounting guidance, current and deferred income taxes should be recognized upon transfer of the assets. Previously, recognition of current and deferred income taxes was prohibited until the asset was sold to an external party. This ASU will be effective beginning in the first quarter of our fiscal year 2018. Early adoption is permitted but must be adopted in the first interim period of the annual period for which the ASU is adopted. The new guidance must be adopted on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the adoption period. We will adopt this ASU on the first day of our fiscal year 2018. While we are still evaluating the impact of this ASU, we currently anticipate a cumulative effect adjustment to retained earnings of approximately $100 million upon adoption. In January 2017, the FASB issued ASU 2017-04 related to goodwill impairment testing. This ASU eliminates Step 2 from the goodwill impairment test. Under the new guidance, if a reporting unit’s carrying amount exceeds its fair value, the entity will record an impairment charge based on that difference. The impairment charge will be limited to the amount of goodwill allocated to that reporting unit. Previously, if the fair value of a reporting unit was lower than its carrying amount (Step 1), an entity was required to calculate any impairment charge by comparing the implied fair value of goodwill with its carrying amount (Step 2). Additionally, under the new standard, entities that have reporting units with zero or negative carrying amounts will no longer be required to perform the qualitative assessment to determine whether to perform Step 2 of the goodwill impairment test. As a result, reporting units with zero or negative carrying amounts will generally be expected to pass the simplified impairment test; however, additional disclosure will be required of those entities. This ASU will be effective beginning in the first quarter of our fiscal year 2020. Early adoption is permitted for annual and interim goodwill impairment testing dates after January 1, 2017. The new guidance must be adopted on a prospective basis. While we are still evaluating the timing of adoption, we currently do not expect this ASU to have a material impact on our financial statements and related disclosures. In March 2017, the FASB issued ASU 2017-07 related to the presentation of net periodic benefit cost (pension and postretirement cost) . This ASU will be effective beginning in the first quarter of our fiscal year 2018. Under the new guidance, the service cost component of net periodic benefit cost must be presented in the same statement of income line item as other employee compensation costs arising from services rendered by employees during the period. Other components of net periodic benefit cost must be disaggregated from the service cost component in the statements of income and must be presented outside the operating income subtotal. Additionally, only the service cost component will be eligible for capitalization in assets. The new guidance must be applied retrospectively for the statement of income presentation of service cost components and other net periodic benefit cost components and prospectively for the capitalization of service cost components. There is a practical expedient that allows us to use historical amounts disclosed in our Postemployment Benefits footnote as an estimation basis for retrospectively applying the statement of income presentation requirements. We plan to use this practical expedient when we adopt this ASU on the first day of our fiscal year 2018. The retrospective impact of adopting ASU 2017-07 in 2018 is expected to be (in millions): For the Three Months Ended For the Nine Months Ended For the Year Ended September 30, October 2, September 30, October 2, December 31, Increase/(decrease) to cost of products sold $ 109 $ 81 $ 455 $ 259 $ 373 Increase/(decrease) to selling, general and administrative expenses 14 14 63 66 93 Increase/(decrease) to operating income (a) (123 ) (95 ) (518 ) (325 ) (466 ) (a) Includes amortization of prior service costs/(credits), curtailments, special/contractual termination benefits, and certain settlements. These components of net pension and postretirement cost/(benefit) totaled approximately $(80) million for the three months and $(400) million for the nine months ended September 30, 2017 , approximately $(70) million for the three months and $(240) million for the nine months ended October 2, 2016 , and approximately $(340) million for the year ended December 31, 2016 . In August 2017, the FASB issued ASU 2017-12 related to accounting for hedging activities. This guidance will impact the accounting for our financial (i.e., foreign exchange and interest rate) and non-financial (i.e., commodity) hedging activities. Key components of this ASU that could impact us are as follows: • Grants the ability to hedge the risk associated with the change in a contractually specified component of the purchase or sale of a non-financial item instead of the total contractual price, which could allow more commodity contracts to qualify for hedge accounting; • Requires us to defer the entire change in value of the derivative, including the effective and ineffective portion, into other comprehensive income until the hedged item impacts net income. When released, the deferred hedge gains and losses, including the ineffective portion, will be recognized in the same statement of income line affected by the hedged item; • Allows us to recognize changes in the fair value of excluded components in other comprehensive income (which will be amortized into net income over the life of the derivative) or in net income in the related period; • Changes hedge effectiveness testing, including timing and allowable methods of testing; and, • Requires additional tabular disclosures in the footnotes to the financial statements. The method for adopting the revised standard is modified retrospective. This ASU will be effective beginning in the first quarter of our fiscal year 2019; however, early adoption is permitted, including in an interim period. We are currently evaluating the timing of adoption and the impact this ASU will have on our financial statements and related disclosures. |
Integration and Restructuring25
Integration and Restructuring Expenses (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring Costs by Type and Income Statement Location | Total expenses related to the Integration Program and restructuring activities recorded in cost of products sold and selling, general and administrative expenses were (in millions): For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, Severance and employee benefit costs - COGS $ (22 ) $ 14 $ (139 ) $ 43 Severance and employee benefit costs - SG&A (3 ) 43 38 89 Asset-related costs - COGS 34 89 134 368 Asset-related costs - SG&A 8 9 21 35 Other costs - COGS 68 49 129 121 Other costs - SG&A 10 33 54 125 $ 95 $ 237 $ 237 $ 781 |
Restructuring Costs Excluded from Segments | The pre-tax impact of allocating such expenses to our segments would have been (in millions): For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, United States $ 75 $ 161 $ 118 $ 607 Canada (3 ) 16 21 43 Europe 6 5 45 33 Rest of World — — 11 — General corporate expenses 17 55 42 98 $ 95 $ 237 $ 237 $ 781 |
Integration Program | |
Restructuring Cost and Reserve [Line Items] | |
Schedule of Restructuring Reserve by Type of Cost | Our liability balance for Integration Program costs that qualify as exit and disposal costs under U.S. GAAP (i.e., severance and employee benefit costs and other exit costs), was (in millions): Severance and Employee Benefit Costs Other Exit Costs (a) Total Balance at December 31, 2016 $ 99 $ 10 $ 109 Charges/(credits) (138 ) 15 (123 ) Cash payments (55 ) (3 ) (58 ) Non-cash utilization 138 (3 ) 135 Balance at September 30, 2017 $ 44 $ 19 $ 63 (a) Other exit costs primarily consist of lease and contract terminations. |
Restructuring Activities | |
Restructuring Cost and Reserve [Line Items] | |
Schedule of Restructuring Reserve by Type of Cost | Our liability balance for restructuring project costs that qualify as exit and disposal costs under U.S. GAAP (i.e., severance and employee benefit costs and other exit costs), was (in millions): Severance and Employee Benefit Costs Other Exit Costs (a) Total Balance at December 31, 2016 $ 12 $ 25 $ 37 Charges/(credits) 37 10 47 Cash payments (32 ) (6 ) (38 ) Non-cash utilization (7 ) — (7 ) Balance at September 30, 2017 $ 10 $ 29 $ 39 (a) Other exit costs primarily consist of lease and contract terminations. |
Restricted Cash (Tables)
Restricted Cash (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract] | |
Reconciliation from Cash and Cash Equivalents to Cash, Cash Equivalents, and Restricted Cash | The following table provides a reconciliation of cash and cash equivalents, as reported on our condensed consolidated balance sheets, to cash, cash equivalents, and restricted cash, as reported on our condensed consolidated statements of cash flows (in millions): September 30, 2017 December 31, 2016 Cash and cash equivalents $ 1,441 $ 4,204 Restricted cash included in other assets (current) 108 42 Restricted cash included in other assets (noncurrent) — 9 Cash, cash equivalents, and restricted cash $ 1,549 $ 4,255 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories consisted of the following (in millions): September 30, 2017 December 31, 2016 Packaging and ingredients $ 713 $ 542 Work in process 464 388 Finished product 2,011 1,754 Inventories $ 3,188 $ 2,684 |
Goodwill and Intangible Asset28
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in the carrying amount of goodwill | Changes in the carrying amount of goodwill, by segment, were (in millions): United States Canada Europe Rest of World Total Balance at December 31, 2016 $ 33,696 $ 4,913 $ 2,778 $ 2,738 $ 44,125 Translation adjustments and other — 379 250 104 733 Balance at September 30, 2017 $ 33,696 $ 5,292 $ 3,028 $ 2,842 $ 44,858 |
Changes in the carrying amount of indefinite-lived intangible assets | Indefinite-lived intangible assets, which primarily consisted of trademarks, were (in millions): Balance at December 31, 2016 $ 53,307 Translation adjustments 380 Impairment losses on indefinite-lived intangible assets (48 ) Balance at September 30, 2017 $ 53,639 |
Schedule of definite-lived intangible assets by major asset class | Definite-lived intangible assets were (in millions): September 30, 2017 December 31, 2016 Gross Accumulated Amortization Net Gross Accumulated Amortization Net Trademarks $ 2,381 $ (256 ) $ 2,125 $ 2,337 $ (172 ) $ 2,165 Customer-related assets 4,230 (502 ) 3,728 4,184 (369 ) 3,815 Other 14 (6 ) 8 13 (3 ) 10 $ 6,625 $ (764 ) $ 5,861 $ 6,534 $ (544 ) $ 5,990 |
Employees' Stock Incentive Pl29
Employees' Stock Incentive Plans (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Share-based Compensation, Stock Option Activity | Our stock option activity and related information was: Number of Stock Options Weighted Average Exercise Price Outstanding at December 31, 2016 20,560,140 $ 37.39 Granted 1,572,848 89.01 Forfeited (559,109 ) 48.13 Exercised (2,005,638 ) 32.94 Outstanding at September 30, 2017 19,568,241 41.69 |
Schedule of Share-based Compensation, RSU Activity | Our restricted stock unit (“RSU”) activity and related information was: Number of Units Weighted Average Grant Date Fair Value (per share) Outstanding at December 31, 2016 806,744 $ 71.95 Granted 1,678,110 85.03 Forfeited (191,072 ) 82.85 Vested (136,272 ) 72.96 Outstanding at September 30, 2017 2,157,510 81.10 |
Postemployment Benefits (Tables
Postemployment Benefits (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Pension Plan | |
Defined Benefit Plan Disclosure [Line Items] | |
Components of Net Cost/(Benefit) | Net pension cost/(benefit) consisted of the following (in millions): For the Three Months Ended For the Nine Months Ended U.S. Plans Non-U.S. Plans U.S. Plans Non-U.S. Plans September 30, October 2, September 30, October 2, September 30, October 2, September 30, October 2, Service cost $ 3 $ 3 $ 5 $ 6 $ 8 $ 10 $ 13 $ 18 Interest cost 45 52 17 21 136 158 49 64 Expected return on plan assets (66 ) (73 ) (47 ) (44 ) (197 ) (221 ) (133 ) (137 ) Amortization of unrecognized losses/(gains) — — — — — — 1 — Settlements 3 26 — — 3 20 — — Special/contractual termination benefits 5 — — — 18 — 8 — Other — — (6 ) — 2 — (15 ) — Net pension cost/(benefit) $ (10 ) $ 8 $ (31 ) $ (17 ) $ (30 ) $ (33 ) $ (77 ) $ (55 ) |
Postretirement Plans | |
Defined Benefit Plan Disclosure [Line Items] | |
Components of Net Cost/(Benefit) | Net postretirement cost/(benefit) consisted of the following (in millions): For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, Service cost $ 2 $ 3 $ 7 $ 11 Interest cost 12 13 37 43 Amortization of prior service costs/(credits) (77 ) (90 ) (250 ) (252 ) Curtailments (9 ) — (177 ) — Net postretirement cost/(benefit) $ (72 ) $ (74 ) $ (383 ) $ (198 ) |
Accumulated Other Comprehensi31
Accumulated Other Comprehensive Income/(Losses) (Tables) - AOCI Attributable to Parent | 9 Months Ended |
Sep. 30, 2017 | |
Accumulated Other Comprehensive Income/(Loss) [Line Items] | |
Components of and Changes in Accumulated Other Comprehensive Income/(Losses) | The components of, and changes in, accumulated other comprehensive income/(losses), net of tax, were as follows (in millions): Foreign Currency Translation Adjustments Net Postemployment Benefit Plan Adjustments Net Cash Flow Hedge Adjustments Total Balance as of December 31, 2016 $ (2,412 ) $ 772 $ 12 $ (1,628 ) Foreign currency translation adjustments 1,181 — — 1,181 Net deferred gains/(losses) on net investment hedges (327 ) — — (327 ) Net postemployment benefit gains/(losses) arising during the period — (12 ) — (12 ) Reclassification of net postemployment benefit losses/(gains) — (260 ) — (260 ) Net deferred gains/(losses) on cash flow hedges — — (136 ) (136 ) Net deferred losses/(gains) on cash flow hedges reclassified to net income — — 97 97 Total other comprehensive income/(loss) 854 (272 ) (39 ) 543 Balance as of September 30, 2017 $ (1,558 ) $ 500 $ (27 ) $ (1,085 ) |
Gross Amount and Related Tax Benefit/(Expense) Recorded in and Associated with each Component of Other Comprehensive Income/(Loss) | The gross amount and related tax benefit/(expense) recorded in, and associated with, each component of other comprehensive income/(loss) were as follows (in millions): For the Three Months Ended September 30, October 2, Before Tax Amount Tax Net of Tax Amount Before Tax Amount Tax Net of Tax Amount Foreign currency translation adjustments $ 421 $ — $ 421 $ (151 ) $ — $ (151 ) Net deferred gains/(losses) on net investment hedges (200 ) 76 (124 ) 34 — 34 Net actuarial gains/(losses) arising during the period (1 ) (3 ) (4 ) (405 ) 154 (251 ) Prior service credits/(costs) arising during the period — — — 172 (66 ) 106 Reclassification of net postemployment benefit losses/(gains) (83 ) 32 (51 ) (64 ) 25 (39 ) Net deferred gains/(losses) on cash flow hedges (76 ) 6 (70 ) 33 (2 ) 31 Net deferred losses/(gains) on cash flow hedges reclassified to net income 51 — 51 (23 ) (3 ) (26 ) For the Nine Months Ended September 30, October 2, Before Tax Amount Tax Net of Tax Amount Before Tax Amount Tax Net of Tax Amount Foreign currency translation adjustments $ 1,181 $ — $ 1,181 $ (304 ) $ — $ (304 ) Net deferred gains/(losses) on net investment hedges (568 ) 241 (327 ) 144 (65 ) 79 Net actuarial gains/(losses) arising during the period (11 ) (2 ) (13 ) (405 ) 154 (251 ) Prior service credits/(costs) arising during the period 2 (1 ) 1 172 (66 ) 106 Reclassification of net postemployment benefit losses/(gains) (423 ) 163 (260 ) (232 ) 89 (143 ) Net deferred gains/(losses) on cash flow hedges (147 ) 11 (136 ) (12 ) 11 (1 ) Net deferred losses/(gains) on cash flow hedges reclassified to net income 96 1 97 (43 ) (1 ) (44 ) |
Amounts Reclassified From Accumulated Other Comprehensive Income/(Losses) | The amounts reclassified from accumulated other comprehensive income/(losses) were as follows (in millions): Accumulated Other Comprehensive Income/(Losses) Component Reclassified from Accumulated Other Comprehensive Income/(Losses) Affected Line Item in the Statement Where Net Income/(Loss) is Presented For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, Losses/(gains) on cash flow hedges: Foreign exchange contracts $ — $ — $ — $ (3 ) Net sales Foreign exchange contracts (2 ) (1 ) (5 ) (34 ) Cost of products sold Foreign exchange contracts 52 (23 ) 98 (9 ) Other expense/(income), net Interest rate contracts 1 1 3 3 Interest expense Losses/(gains) on cash flow hedges before income taxes 51 (23 ) 96 (43 ) Losses/(gains) on cash flow hedges, income taxes — (3 ) 1 (1 ) Losses/(gains) on cash flow hedges $ 51 $ (26 ) $ 97 $ (44 ) Losses/(gains) on postemployment benefits: Amortization of unrecognized losses/(gains) $ — $ — $ 1 $ — (a) Amortization of prior service costs/(credits) (77 ) (90 ) (250 ) (252 ) (a) Settlement and curtailments losses/(gains) (6 ) 26 (174 ) 20 (a) Losses/(gains) on postemployment benefits before income taxes (83 ) (64 ) (423 ) (232 ) Losses/(gains) on postemployment benefits, income taxes 32 25 163 89 Losses/(gains) on postemployment benefits $ (51 ) $ (39 ) $ (260 ) $ (143 ) (a) These components are included in the computation of net periodic postemployment benefit costs. See Note 8, Postemployment Benefits , for additional information. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of notional amounts of outstanding derivative positions | The notional values of our derivative instruments were (in millions): Notional Amount September 30, 2017 December 31, 2016 Commodity contracts $ 332 $ 459 Foreign exchange contracts 3,753 2,997 Cross-currency contracts 2,950 3,173 |
Schedule of derivative fair values and levels within the fair value hierarchy on the balance sheets | The fair values and the levels within the fair value hierarchy of derivative instruments recorded on the consolidated balance sheets were (in millions): September 30, 2017 Quoted Prices in Active Markets for Identical Assets and Liabilities Significant Other Observable Inputs Significant Unobservable Inputs Total Fair Value Assets Liabilities Assets Liabilities Assets Liabilities Assets Liabilities Derivatives designated as hedging instruments: Foreign exchange contracts $ — $ — $ 9 $ 103 $ — $ — $ 9 $ 103 Cross-currency contracts — — 354 — — — 354 — Derivatives not designated as hedging instruments: Commodity contracts 8 14 — 1 — — 8 15 Foreign exchange contracts — — 46 — — — 46 — Cross-currency contracts — — — — — — — — Total fair value $ 8 $ 14 $ 409 $ 104 $ — $ — $ 417 $ 118 December 31, 2016 Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fair Value Assets Liabilities Assets Liabilities Assets Liabilities Assets Liabilities Derivatives designated as hedging instruments: Foreign exchange contracts $ — $ — $ 69 $ 13 $ — $ — $ 69 $ 13 Cross-currency contracts — — 580 36 — — 580 36 Derivatives not designated as hedging instruments: Commodity contracts 28 7 — — — — 28 7 Foreign exchange contracts — — 35 30 — — 35 30 Cross-currency contracts — — 44 — — — 44 — Total fair value $ 28 $ 7 $ 728 $ 79 $ — $ — $ 756 $ 86 |
Schedule of cross-currency swap derivatives | At September 30, 2017 , our cross-currency swaps designated as net investment hedges consisted of: Instrument Notional (local) (in billions) Notional (USD) (in billions) Maturity Cross-currency swap £ 0.8 $ 1.4 October 2019 Cross-currency swap C$ 1.8 $ 1.6 December 2019 |
Derivative impact on the statements of income and statements of comprehensive income | The following tables present the pre-tax effect of derivative instruments on the consolidated statements of income and statements of comprehensive income: For the Three Months Ended September 30, October 2, Commodity Contracts Foreign Exchange Cross-Currency Contracts Interest Rate Contracts Commodity Contracts Foreign Exchange Cross-Currency Contracts Interest Rate (in millions) Derivatives designated as hedging instruments: Cash flow hedges: Gains/(losses) recognized in other comprehensive income/(loss) (effective portion) $ — $ (76 ) $ — $ — $ — $ 33 $ — $ — Net investment hedges: Gains/(losses) recognized in other comprehensive income/(loss) (effective portion) — (6 ) (81 ) — — — 49 — Total gains/(losses) recognized in other comprehensive income/(loss) (effective portion) $ — $ (82 ) $ (81 ) $ — $ — $ 33 $ 49 $ — Cash flow hedges reclassified to net income/(loss): Net sales $ — $ — $ — $ — $ — $ — $ — $ — Cost of products sold (effective portion) — 2 — — — 1 — — Other expense/(income), net — (52 ) — — — 23 — — Interest expense — — — (1 ) — — — (1 ) — (50 ) — (1 ) — 24 — (1 ) Derivatives not designated as hedging instruments: Gains/(losses) on derivatives recognized in cost of products sold 4 — — — (17 ) — — — Gains/(losses) on derivatives recognized in other expense/(income), net — 27 — — — (4 ) 2 — 4 27 — — (17 ) (4 ) 2 — Total gains/(losses) recognized in statements of income $ 4 $ (23 ) $ — $ (1 ) $ (17 ) $ 20 $ 2 $ (1 ) For the Nine Months Ended September 30, October 2, Commodity Contracts Foreign Exchange Contracts Cross-Currency Contracts Interest Rate Contracts Commodity Contracts Foreign Exchange Contracts Cross-Currency Contracts Interest Rate Contracts (in millions) Derivatives designated as hedging instruments: Cash flow hedges: Gains/(losses) recognized in other comprehensive income/(loss) (effective portion) $ — $ (147 ) $ — $ — $ — $ (4 ) $ — $ (8 ) Net investment hedges: Gains/(losses) recognized in other comprehensive income/(loss) (effective portion) — (18 ) (177 ) — — 46 74 — Total gains/(losses) recognized in other comprehensive income/(loss) (effective portion) $ — $ (165 ) $ (177 ) $ — $ — $ 42 $ 74 $ (8 ) Cash flow hedges reclassified to net income/(loss): Net sales $ — $ — $ — $ — $ — $ 3 $ — $ — Cost of products sold (effective portion) — 5 — — — 34 — — Other expense/(income), net — (98 ) — — — 9 — — Interest expense — — — (3 ) — — — (3 ) — (93 ) — (3 ) — 46 — (3 ) Derivatives not designated as hedging instruments: Gains/(losses) on derivatives recognized in cost of products sold (33 ) — — — (6 ) — — — Gains/(losses) on derivatives recognized in other expense/(income), net — 55 (2 ) — — (61 ) (6 ) — (33 ) 55 (2 ) — (6 ) (61 ) (6 ) — Total gains/(losses) recognized in statements of income $ (33 ) $ (38 ) $ (2 ) $ (3 ) $ (6 ) $ (15 ) $ (6 ) $ (3 ) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | Our earnings per common share (“EPS”) were: For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, (in millions, except per share data) Basic Earnings Per Common Share: Net income/(loss) attributable to common shareholders $ 944 $ 842 $ 2,996 $ 2,508 Weighted average shares of common stock outstanding 1,218 1,218 1,218 1,216 Net earnings/(loss) $ 0.78 $ 0.69 $ 2.46 $ 2.06 Diluted Earnings Per Common Share: Net income/(loss) attributable to common shareholders $ 944 $ 842 $ 2,996 $ 2,508 Weighted average shares of common stock outstanding 1,218 1,218 1,218 1,216 Effect of dilutive equity awards 10 10 11 10 Weighted average shares of common stock outstanding, including dilutive effect 1,228 1,228 1,229 1,226 Net earnings/(loss) $ 0.77 $ 0.69 $ 2.44 $ 2.05 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Net Sales by Segment | Net sales by segment were (in millions): For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, Net sales: United States $ 4,380 $ 4,395 $ 13,566 $ 13,802 Canada 559 550 1,599 1,692 Europe 599 558 1,737 1,766 Rest of World 776 764 2,453 2,370 Total net sales $ 6,314 $ 6,267 $ 19,355 $ 19,630 |
Segment Adjusted EBITDA | Segment Adjusted EBITDA was (in millions): For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, Segment Adjusted EBITDA: United States $ 1,440 $ 1,349 $ 4,478 $ 4,360 Canada 162 148 477 491 Europe 206 191 578 592 Rest of World 149 145 475 513 General corporate expenses (28 ) (30 ) (93 ) (115 ) Depreciation and amortization (excluding integration and restructuring expenses) (165 ) (116 ) (434 ) (401 ) Integration and restructuring expenses (95 ) (237 ) (237 ) (781 ) Merger costs — (4 ) — (33 ) Unrealized gains/(losses) on commodity hedges 5 (22 ) (24 ) 23 Impairment losses (1 ) — (49 ) (53 ) Nonmonetary currency devaluation — (1 ) — (4 ) Equity award compensation expense (excluding integration and restructuring expenses) (12 ) (10 ) (38 ) (30 ) Operating income 1,661 1,413 5,133 4,562 Interest expense 306 311 926 824 Other expense/(income), net (4 ) (3 ) 8 (5 ) Income/(loss) before income taxes $ 1,359 $ 1,105 $ 4,199 $ 3,743 |
Net Sales by Product | Our net sales by product category were (in millions): For the Three Months Ended For the Nine Months Ended September 30, October 2, September 30, October 2, Condiments and sauces $ 1,568 $ 1,562 $ 4,791 $ 4,886 Cheese and dairy 1,283 1,288 3,901 4,004 Ambient meals 571 577 1,695 1,726 Frozen and chilled meals 642 642 1,934 1,895 Meats and seafood 663 670 2,018 2,093 Refreshment beverages 371 368 1,180 1,218 Coffee 331 337 1,021 1,076 Infant and nutrition 176 171 575 577 Desserts, toppings and baking 220 216 649 661 Nuts and salted snacks 202 237 686 752 Other 287 199 905 742 Total net sales $ 6,314 $ 6,267 $ 19,355 $ 19,630 |
Supplemental Financial Inform35
Supplemental Financial Information (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Condensed Consolidating Statements of Income | The Kraft Heinz Company Condensed Consolidating Statements of Income For the Three Months Ended September 30, 2017 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated Net sales $ — $ 4,170 $ 2,286 $ (142 ) $ 6,314 Cost of products sold — 2,601 1,541 (142 ) 4,000 Gross profit — 1,569 745 — 2,314 Selling, general and administrative expenses — 155 498 — 653 Intercompany service fees and other recharges — 776 (776 ) — — Operating income — 638 1,023 — 1,661 Interest expense — 296 10 — 306 Other expense/(income), net — 23 (27 ) — (4 ) Income/(loss) before income taxes — 319 1,040 — 1,359 Provision for/(benefit from) income taxes — (11 ) 427 — 416 Equity in earnings of subsidiaries 944 614 — (1,558 ) — Net income/(loss) 944 944 613 (1,558 ) 943 Net income/(loss) attributable to noncontrolling interest — — (1 ) — (1 ) Net income/(loss) excluding noncontrolling interest $ 944 $ 944 $ 614 $ (1,558 ) $ 944 Comprehensive income/(loss) excluding noncontrolling interest $ 1,167 $ 1,167 $ 1,165 $ (2,332 ) $ 1,167 The Kraft Heinz Company Condensed Consolidating Statements of Income For the Three Months Ended October 2, 2016 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated Net sales $ — $ 4,206 $ 2,233 $ (172 ) $ 6,267 Cost of products sold — 2,700 1,521 (172 ) 4,049 Gross profit — 1,506 712 — 2,218 Selling, general and administrative expenses — 194 611 — 805 Intercompany service fees and other recharges — 795 (795 ) — — Operating income — 517 896 — 1,413 Interest expense — 294 17 — 311 Other expense/(income), net — (20 ) 17 — (3 ) Income/(loss) before income taxes — 243 862 — 1,105 Provision for/(benefit from) income taxes — (199 ) 461 — 262 Equity in earnings of subsidiaries 842 400 — (1,242 ) — Net income/(loss) 842 842 401 (1,242 ) 843 Net income/(loss) attributable to noncontrolling interest — — 1 — 1 Net income/(loss) excluding noncontrolling interest $ 842 $ 842 $ 400 $ (1,242 ) $ 842 Comprehensive income/(loss) excluding noncontrolling interest $ 547 $ 547 $ 285 $ (832 ) $ 547 The Kraft Heinz Company Condensed Consolidating Statements of Income For the Nine Months Ended September 30, 2017 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated Net sales $ — $ 12,941 $ 6,856 $ (442 ) $ 19,355 Cost of products sold — 7,825 4,676 (442 ) 12,059 Gross profit — 5,116 2,180 — 7,296 Selling, general and administrative expenses — 504 1,659 — 2,163 Intercompany service fees and other recharges — 3,205 (3,205 ) — — Operating income — 1,407 3,726 — 5,133 Interest expense — 895 31 — 926 Other expense/(income), net — (8 ) 16 — 8 Income/(loss) before income taxes — 520 3,679 — 4,199 Provision for/(benefit from) income taxes — (92 ) 1,297 — 1,205 Equity in earnings of subsidiaries 2,996 2,384 — (5,380 ) — Net income/(loss) 2,996 2,996 2,382 (5,380 ) 2,994 Net income/(loss) attributable to noncontrolling interest — — (2 ) — (2 ) Net income/(loss) excluding noncontrolling interest $ 2,996 $ 2,996 $ 2,384 $ (5,380 ) $ 2,996 Comprehensive income/(loss) excluding noncontrolling interest $ 3,539 $ 3,539 $ 4,351 $ (7,890 ) $ 3,539 The Kraft Heinz Company Condensed Consolidating Statements of Income For the Nine Months Ended October 2, 2016 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated Net sales $ — $ 13,156 $ 6,948 $ (474 ) $ 19,630 Cost of products sold — 8,273 4,704 (474 ) 12,503 Gross profit — 4,883 2,244 — 7,127 Selling, general and administrative expenses — 778 1,787 — 2,565 Intercompany service fees and other recharges — 3,320 (3,320 ) — — Operating income — 785 3,777 — 4,562 Interest expense — 782 42 — 824 Other expense/(income), net — 66 (71 ) — (5 ) Income/(loss) before income taxes — (63 ) 3,806 — 3,743 Provision for/(benefit from) income taxes — (349 ) 1,394 — 1,045 Equity in earnings of subsidiaries 2,688 2,402 — (5,090 ) — Net income/(loss) 2,688 2,688 2,412 (5,090 ) 2,698 Net income/(loss) attributable to noncontrolling interest — — 10 — 10 Net income/(loss) excluding noncontrolling interest $ 2,688 $ 2,688 $ 2,402 $ (5,090 ) $ 2,688 Comprehensive income/(loss) excluding noncontrolling interest $ 2,131 $ 2,131 $ 2,013 $ (4,144 ) $ 2,131 |
Condensed Consolidating Balance Sheets | The Kraft Heinz Company Condensed Consolidating Balance Sheets As of September 30, 2017 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated ASSETS Cash and cash equivalents $ — $ 217 $ 1,224 $ — $ 1,441 Trade receivables — 4 934 — 938 Receivables due from affiliates 725 205 (930 ) — Dividends due from affiliates 101 — — (101 ) — Sold receivables — — 427 — 427 Inventories — 2,087 1,101 — 3,188 Short-term lending due from affiliates — 2,098 3,513 (5,611 ) — Other current assets — 3,229 391 (2,386 ) 1,234 Total current assets 101 8,360 7,795 (9,028 ) 7,228 Property, plant and equipment, net — 4,506 2,428 — 6,934 Goodwill — 11,067 33,791 — 44,858 Investments in subsidiaries 58,759 72,096 — (130,855 ) — Intangible assets, net — 3,258 56,242 — 59,500 Long-term lending due from affiliates — 1,700 2,000 (3,700 ) — Other assets — 499 1,032 — 1,531 TOTAL ASSETS $ 58,860 $ 101,486 $ 103,288 $ (143,583 ) $ 120,051 LIABILITIES AND EQUITY Commercial paper and other short-term debt $ — $ 443 $ 12 $ — $ 455 Current portion of long-term debt — 2,583 172 — 2,755 Short-term lending due to affiliates — 3,513 2,098 (5,611 ) — Trade payables — 2,324 1,623 — 3,947 Payables due to affiliates — 205 725 (930 ) — Accrued marketing — 124 369 — 493 Accrued postemployment costs — 84 74 — 158 Income taxes payable — — 2,555 (2,386 ) 169 Interest payable — 284 11 — 295 Dividends due to affiliates — 101 — (101 ) — Other current liabilities 101 497 517 — 1,115 Total current liabilities 101 10,158 8,156 (9,028 ) 9,387 Long-term debt — 27,396 903 — 28,299 Long-term borrowings due to affiliates — 2,000 1,921 (3,921 ) — Deferred income taxes — 1,368 19,530 — 20,898 Accrued postemployment costs — 1,508 300 — 1,808 Other liabilities — 297 391 — 688 TOTAL LIABILITIES 101 42,727 31,201 (12,949 ) 61,080 Total shareholders’ equity 58,759 58,759 71,875 (130,634 ) 58,759 Noncontrolling interest — — 212 — 212 TOTAL EQUITY 58,759 58,759 72,087 (130,634 ) 58,971 TOTAL LIABILITIES AND EQUITY $ 58,860 $ 101,486 $ 103,288 $ (143,583 ) $ 120,051 The Kraft Heinz Company Condensed Consolidating Balance Sheets As of December 31, 2016 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated ASSETS Cash and cash equivalents $ — $ 2,830 $ 1,374 $ — $ 4,204 Trade receivables — 12 757 — 769 Receivables due from affiliates — 712 111 (823 ) — Dividends due from affiliates 39 — — (39 ) — Sold receivables — — 129 — 129 Inventories — 1,759 925 — 2,684 Short-term lending due from affiliates — 1,722 2,956 (4,678 ) — Other current assets — 2,229 447 (1,709 ) 967 Total current assets 39 9,264 6,699 (7,249 ) 8,753 Property, plant and equipment, net — 4,447 2,241 — 6,688 Goodwill — 11,067 33,058 — 44,125 Investments in subsidiaries 57,358 70,877 — (128,235 ) — Intangible assets, net — 3,364 55,933 — 59,297 Long-term lending due from affiliates — 1,700 2,000 (3,700 ) — Other assets — 501 1,116 — 1,617 TOTAL ASSETS $ 57,397 $ 101,220 $ 101,047 $ (139,184 ) $ 120,480 LIABILITIES AND EQUITY Commercial paper and other short-term debt $ — $ 642 $ 3 $ — $ 645 Current portion of long-term debt — 2,032 14 — 2,046 Short-term lending due to affiliates — 2,956 1,722 (4,678 ) — Trade payables — 2,376 1,620 — 3,996 Payables due to affiliates — 111 712 (823 ) — Accrued marketing — 277 472 — 749 Accrued postemployment costs — 144 13 — 157 Income taxes payable — — 1,964 (1,709 ) 255 Interest payable — 401 14 — 415 Dividends due to affiliates — 39 — (39 ) — Other current liabilities 39 588 611 — 1,238 Total current liabilities 39 9,566 7,145 (7,249 ) 9,501 Long-term debt — 28,736 977 — 29,713 Long-term borrowings due to affiliates — 2,000 1,902 (3,902 ) — Deferred income taxes — 1,382 19,466 — 20,848 Accrued postemployment costs — 1,754 284 — 2,038 Other liabilities — 424 382 — 806 TOTAL LIABILITIES 39 43,862 30,156 (11,151 ) 62,906 Total shareholders’ equity 57,358 57,358 70,675 (128,033 ) 57,358 Noncontrolling interest — — 216 — 216 TOTAL EQUITY 57,358 57,358 70,891 (128,033 ) 57,574 TOTAL LIABILITIES AND EQUITY $ 57,397 $ 101,220 $ 101,047 $ (139,184 ) $ 120,480 |
Condensed Consolidating Statements of Cash Flows | The Kraft Heinz Company Condensed Consolidating Statements of Cash Flows For the Nine Months Ended September 30, 2017 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated CASH FLOWS FROM OPERATING ACTIVITIES Net cash provided by/(used for) operating activities $ 2,161 $ 1,185 $ (1,169 ) $ (2,161 ) $ 16 CASH FLOWS FROM INVESTING ACTIVITIES Cash receipts on sold receivables — — 1,633 — 1,633 Capital expenditures — (622 ) (334 ) — (956 ) Net proceeds from/(payments on) intercompany lending activities — 59 (267 ) 208 — Additional investments in subsidiaries (15 ) — — 15 — Other investing activities, net — 54 (7 ) — 47 Net cash provided by/(used for) investing activities (15 ) (509 ) 1,025 223 724 CASH FLOWS FROM FINANCING ACTIVITIES Repayments of long-term debt — (2,625 ) (11 ) — (2,636 ) Proceeds from issuance of long-term debt — 1,496 — — 1,496 Proceeds from issuance of commercial paper — 5,495 — — 5,495 Repayments of commercial paper — (5,709 ) — — (5,709 ) Net proceeds from/(payments on) intercompany borrowing activities — 267 (59 ) (208 ) — Dividends paid-common stock (2,161 ) (2,161 ) — 2,161 (2,161 ) Other intercompany capital stock transactions — 15 — (15 ) — Other financing activities, net 15 (6 ) 17 — 26 Net cash provided by/(used for) financing activities (2,146 ) (3,228 ) (53 ) 1,938 (3,489 ) Effect of exchange rate changes on cash, cash equivalents, and restricted cash — — 43 — 43 Cash, cash equivalents, and restricted cash: Net increase/(decrease) — (2,552 ) (154 ) — (2,706 ) Balance at beginning of period — 2,869 1,386 — 4,255 Balance at end of period $ — $ 317 $ 1,232 $ — $ 1,549 The Kraft Heinz Company Condensed Consolidating Statements of Cash Flows For the Nine Months Ended October 2, 2016 (in millions) (Unaudited) Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated CASH FLOWS FROM OPERATING ACTIVITIES Net cash provided by/(used for) operating activities $ 1,636 $ 1,821 $ (805 ) $ (1,636 ) $ 1,016 CASH FLOWS FROM INVESTING ACTIVITIES Cash receipts on sold receivables — — 1,850 — 1,850 Capital expenditures — (605 ) (231 ) — (836 ) Net proceeds from/(payments on) intercompany lending activities — 565 (74 ) (491 ) — Additional investments in subsidiaries — (10 ) — 10 — Return of capital 8,987 — — (8,987 ) — Other investing activities, net — 100 (30 ) — 70 Net cash provided by/(used for) investing activities 8,987 50 1,515 (9,468 ) 1,084 CASH FLOWS FROM FINANCING ACTIVITIES Repayments of long-term debt — (69 ) (5 ) — (74 ) Proceeds from issuance of long-term debt — 6,978 3 — 6,981 Proceeds from issuance of commercial paper — 4,296 — — 4,296 Repayments of commercial paper — (3,660 ) — — (3,660 ) Net proceeds from/(payments on) intercompany borrowing activities — 74 (565 ) 491 — Dividends paid-Series A Preferred Stock (180 ) — — — (180 ) Dividends paid-common stock (2,123 ) (2,303 ) — 2,303 (2,123 ) Redemption of Series A Preferred Stock (8,320 ) — — — (8,320 ) Other intercompany capital stock transactions — (8,320 ) 10 8,310 — Other financing activities, net — 50 6 — 56 Net cash provided by/(used for) financing activities (10,623 ) (2,954 ) (551 ) 11,104 (3,024 ) Effect of exchange rate changes on cash, cash equivalents, and restricted cash — — (17 ) — (17 ) Cash, cash equivalents, and restricted cash: Net increase/(decrease) — (1,083 ) 142 — (941 ) Balance at beginning of period — 3,253 1,659 — 4,912 Balance at end of period $ — $ 2,170 $ 1,801 $ — $ 3,971 |
Reconciliation from Cash and Cash Equivalents to Cash, Cash Equivalents, and Restricted Cash | The following tables provide a reconciliation of cash and cash equivalents, as reported on our unaudited condensed consolidating balance sheets, to cash, cash equivalents, and restricted cash, as reported on our unaudited condensed consolidating statements of cash flows (in millions): September 30, 2017 Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated Cash and cash equivalents $ — $ 217 $ 1,224 $ — $ 1,441 Restricted cash included in other assets (current) — 100 8 — 108 Cash, cash equivalents, and restricted cash $ — $ 317 $ 1,232 $ — $ 1,549 December 31, 2016 Parent Guarantor Subsidiary Issuer Non-Guarantor Subsidiaries Eliminations Consolidated Cash and cash equivalents $ — $ 2,830 $ 1,374 $ — $ 4,204 Restricted cash included in other assets (current) — 39 3 — 42 Restricted cash included in other assets (noncurrent) — — 9 — 9 Cash, cash equivalents, and restricted cash $ — $ 2,869 $ 1,386 $ — $ 4,255 |
Background and Basis of Prese36
Background and Basis of Presentation Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | Dec. 31, 2016 | Dec. 31, 2017 | Jan. 03, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Effective income tax rate reconciliation, share based compensation, excess tax benefit, amount | $ (416) | $ (262) | $ (1,205) | $ (1,045) | |||
Cash receipts on sold receivables | 1,633 | 1,850 | |||||
Dividends paid-Series A Preferred Stock | 0 | 180 | |||||
Accounting Standards Update 2016-09 | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Effective income tax rate reconciliation, share based compensation, excess tax benefit, amount | 3 | 19 | |||||
Accounting Standards Update 2016-15 | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Cash receipts on sold receivables | 1,900 | $ 2,600 | |||||
Accounting Standards Update 2016-18 | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Restricted cash | 51 | 51 | 51 | $ 75 | |||
Dividends paid-Series A Preferred Stock | 24 | 24 | |||||
Forecast | Accounting Standards Update 2016-16 | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Cumulative effect adjustment to retained earnings | $ 100 | ||||||
New accounting pronouncement, not yet adopted, effect | Pro forma | |||||||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | |||||||
Net postemployment cost/(benefit) | $ (80) | $ (70) | $ (400) | $ (240) | $ (340) |
Background and Basis of Prese37
Background and Basis of Presentation Expected Impact of Adopting ASU 2017-07 on Statements of Income (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | Dec. 31, 2016 | |
Cost of products sold | $ 4,000 | $ 4,049 | $ 12,059 | $ 12,503 | |
Selling, general and administrative expenses | 653 | 805 | 2,163 | 2,565 | |
Operating income | 1,661 | 1,413 | 5,133 | 4,562 | |
New accounting pronouncement, not yet adopted, effect | Pro forma | |||||
Cost of products sold | 109 | 81 | 455 | 259 | $ 373 |
Selling, general and administrative expenses | 14 | 14 | 63 | 66 | 93 |
Operating income | $ (123) | $ (95) | $ (518) | $ (325) | $ (466) |
Integration and Restructuring38
Integration and Restructuring Expenses Additional Information (Details) $ in Millions | 3 Months Ended | 9 Months Ended | 27 Months Ended | |||
Sep. 30, 2017USD ($) | Jul. 01, 2017USD ($) | Oct. 02, 2016USD ($) | Sep. 30, 2017USD ($)employee | Oct. 02, 2016USD ($) | Sep. 30, 2017USD ($)employeefactory | |
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Incurred Cost | $ 95 | $ 237 | $ 237 | $ 781 | ||
Integration Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Expected Cost | $ 2,100 | $ 2,100 | $ 2,100 | |||
Restructuring and Related Cost, Expected Cost, Classified as Costs of Products Sold, Percent | 60.00% | 60.00% | 60.00% | |||
Restructuring and Related Cost, Expected Number of Positions Eliminated | employee | 5,150 | |||||
Restructuring and Related Activities, Expected Number of Facilities Eliminated | factory | 6 | |||||
Restructuring and Related Cost, Number of Positions Eliminated | employee | 4,800 | |||||
Restructuring and Related Cost, Number of Facilities Eliminated | factory | 6 | |||||
Restructuring and Related Cost, Incurred Cost | 222 | $ 157 | 722 | |||
Restructuring and Related Cost, Cost Incurred to Date | $ 1,900 | $ 1,900 | $ 1,900 | |||
Restructuring and Related Cost, Expected Cost, Cash Expenditures, Percent | 60.00% | 60.00% | 60.00% | |||
Restructuring Activities | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Number of Positions Eliminated | employee | 500 | |||||
Restructuring and Related Cost, Incurred Cost | $ 16 | 15 | $ 80 | 59 | ||
Organization Costs | Integration Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Expected Cost | 400 | 400 | $ 400 | |||
Footprint Costs | Integration Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Expected Cost | 1,300 | 1,300 | 1,300 | |||
Other Costs | Integration Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Expected Cost | 400 | 400 | 400 | |||
Severance and Employee Benefit Costs | Integration Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Cost Incurred to Date | 543 | 543 | 543 | |||
Severance and Employee Benefit Costs | Restructuring Activities | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Incurred Cost | 8 | 37 | ||||
Asset-Related Costs | Integration Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Cost Incurred to Date | 803 | 803 | 803 | |||
Asset-Related Costs | Restructuring Activities | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Incurred Cost | 1 | |||||
Other Implementation Costs | Integration Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Cost Incurred to Date | 417 | 417 | 417 | |||
Other Implementation Costs | Restructuring Activities | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Incurred Cost | 7 | 32 | ||||
Other Exit Costs | Integration Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Cost Incurred to Date | 110 | 110 | $ 110 | |||
Other Exit Costs | Restructuring Activities | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Incurred Cost | 1 | 10 | ||||
Postretirement Plans | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Curtailments | $ (9) | $ (168) | $ 0 | $ (177) | $ 0 |
Integration and Restructuring39
Integration and Restructuring Expenses Integration Program Reserve Roll-forward (Details) - Integration Program $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Restructuring Reserve [Roll Forward] | |
Beginning Balance | $ 109 |
Charges | (123) |
Cash payments | (58) |
Non-cash utilization | 135 |
Ending Balance | 63 |
Severance and Employee Benefit Costs | |
Restructuring Reserve [Roll Forward] | |
Beginning Balance | 99 |
Charges | (138) |
Cash payments | (55) |
Non-cash utilization | 138 |
Ending Balance | 44 |
Other Exit Costs | |
Restructuring Reserve [Roll Forward] | |
Beginning Balance | 10 |
Charges | 15 |
Cash payments | (3) |
Non-cash utilization | (3) |
Ending Balance | $ 19 |
Integration and Restructuring40
Integration and Restructuring Expenses Restructuring Reserve Roll-forward (Details) - Restructuring Activities $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Restructuring Reserve [Roll Forward] | |
Beginning Balance | $ 37 |
Charges | 47 |
Cash payments | (38) |
Non-cash utilization | (7) |
Ending Balance | 39 |
Severance and Employee Benefit Costs | |
Restructuring Reserve [Roll Forward] | |
Beginning Balance | 12 |
Charges | 37 |
Cash payments | (32) |
Non-cash utilization | (7) |
Ending Balance | 10 |
Other Exit Costs | |
Restructuring Reserve [Roll Forward] | |
Beginning Balance | 25 |
Charges | 10 |
Cash payments | (6) |
Non-cash utilization | 0 |
Ending Balance | $ 29 |
Integration and Restructuring41
Integration and Restructuring Expenses Restructuring Costs by Type and Income Statement Location (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | $ 95 | $ 237 | $ 237 | $ 781 |
Severance and Employee Benefit Costs | Cost of products sold | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | (22) | 14 | (139) | 43 |
Severance and Employee Benefit Costs | Selling, general and administrative expenses | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | (3) | 43 | 38 | 89 |
Asset-Related Costs | Cost of products sold | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | 34 | 89 | 134 | 368 |
Asset-Related Costs | Selling, general and administrative expenses | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | 8 | 9 | 21 | 35 |
Other Costs | Cost of products sold | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | 68 | 49 | 129 | 121 |
Other Costs | Selling, general and administrative expenses | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | $ 10 | $ 33 | $ 54 | $ 125 |
Integration and Restructuring42
Integration and Restructuring Expenses Restructuring Costs Excluded from Segments (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Segment Reporting Information [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | $ 95 | $ 237 | $ 237 | $ 781 |
United States | ||||
Segment Reporting Information [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | 75 | 161 | 118 | 607 |
Canada | ||||
Segment Reporting Information [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | (3) | 16 | 21 | 43 |
Europe | ||||
Segment Reporting Information [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | 6 | 5 | 45 | 33 |
Rest of World | ||||
Segment Reporting Information [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | 0 | 0 | 11 | 0 |
General corporate expenses | ||||
Segment Reporting Information [Line Items] | ||||
Restructuring and Related Cost, Incurred Cost | $ 17 | $ 55 | $ 42 | $ 98 |
Restricted Cash Reconciliation
Restricted Cash Reconciliation from Cash and Cash Equivalents to Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 | Oct. 02, 2016 | Jan. 03, 2016 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 1,441 | $ 4,204 | ||
Restricted cash included in other assets (current) | 108 | 42 | ||
Restricted cash included in other assets (noncurrent) | 0 | 9 | ||
Cash, cash equivalents, and restricted cash | $ 1,549 | $ 4,255 | $ 3,971 | $ 4,912 |
Inventories Components of Inven
Inventories Components of Inventories (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Packaging and ingredients | $ 713 | $ 542 |
Work in process | 464 | 388 |
Finished product | 2,011 | 1,754 |
Inventories | $ 3,188 | $ 2,684 |
Goodwill and Intangible Asset45
Goodwill and Intangible Assets Goodwill by Segment (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 44,125 |
Translation adjustments | 733 |
Ending balance | 44,858 |
United States | |
Goodwill [Roll Forward] | |
Beginning balance | 33,696 |
Translation adjustments | 0 |
Ending balance | 33,696 |
Canada | |
Goodwill [Roll Forward] | |
Beginning balance | 4,913 |
Translation adjustments | 379 |
Ending balance | 5,292 |
Europe | |
Goodwill [Roll Forward] | |
Beginning balance | 2,778 |
Translation adjustments | 250 |
Ending balance | 3,028 |
Rest of World | |
Goodwill [Roll Forward] | |
Beginning balance | 2,738 |
Translation adjustments | 104 |
Ending balance | $ 2,842 |
Goodwill and Intangible Asset46
Goodwill and Intangible Assets Goodwill - Additional Information (Details) | Apr. 02, 2017USD ($) | Sep. 30, 2017USD ($)goodwill_reporting_unit | Dec. 31, 2016USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill, impairment loss | $ 0 | ||
Reporting unit, percentage of fair value in excess of carrying amount | 10.00% | ||
Number of reporting units | goodwill_reporting_unit | 18 | ||
Goodwill | $ 44,858,000,000 | $ 44,125,000,000 | |
Goodwill, impaired, accumulated impairment loss | $ 0 |
Goodwill and Intangible Asset47
Goodwill and Intangible Assets Indefinite-Lived Intangible Assets (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Beginning balance | $ 53,307 |
Translation adjustments | 380 |
Impairment losses on indefinite-lived intangible assets | 48 |
Ending balance | $ 53,639 |
Goodwill and Intangible Asset48
Goodwill and Intangible Assets Indefinite-Lived Intangible Assets - Additional Information (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2017 | Apr. 02, 2017 | Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Impairment losses on indefinite-lived intangible assets | $ (48) | ||
Reporting unit, percentage of fair value in excess of carrying amount | 10.00% | ||
Indefinite-lived intangible assets | $ 53,639 | $ 53,307 |
Goodwill and Intangible Asset49
Goodwill and Intangible Assets Definite-Lived Intangible Assets (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Gross | $ 6,625 | $ 6,534 |
Accumulated Amortization | (764) | (544) |
Net | 5,861 | 5,990 |
Trademarks | ||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Gross | 2,381 | 2,337 |
Accumulated Amortization | (256) | (172) |
Net | 2,125 | 2,165 |
Customer-related assets | ||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Gross | 4,230 | 4,184 |
Accumulated Amortization | (502) | (369) |
Net | 3,728 | 3,815 |
Other | ||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Gross | 14 | 13 |
Accumulated Amortization | (6) | (3) |
Net | $ 8 | $ 10 |
Goodwill and Intangible Asset50
Goodwill and Intangible Assets Definite-Lived Intangible Assets - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of intangible assets | $ 76 | $ 66 | $ 220 | $ 198 |
Amortization of intangible assets, next twelve months | 280 | 280 | ||
Amortization of intangible assets, year two | 270 | 270 | ||
Amortization of intangible assets, year three | 270 | 270 | ||
Amortization of intangible assets, year four | 270 | 270 | ||
Amortization of intangible assets, year five | $ 270 | $ 270 |
Income Taxes Additional Informa
Income Taxes Additional Information (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Effective tax rate | 30.60% | 23.70% | 28.70% | 27.90% |
Employees' Stock Incentive Pl52
Employees' Stock Incentive Plans Schedule of Share-Based Compensation, Stock Option Activity (Details) | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Roll-forward of Stock Option Activity (in shares) | |
Beginning balance | shares | 20,560,140 |
Granted | shares | 1,572,848 |
Forfeited | shares | (559,109) |
Exercised | shares | (2,005,638) |
Ending balance | shares | 19,568,241 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |
Options outstanding at period start, weighted average exercise price (in dollars per share) | $ / shares | $ 37.39 |
Options granted, weighted average exercise price (in dollars per share) | $ / shares | 89.01 |
Options forfeited, weighted average exercise price (in dollars per share) | $ / shares | 48.13 |
Options exercised, weighted average exercise price (in dollars per share) | $ / shares | 32.94 |
Options outstanding at period end, weighted average exercise price (in dollars per share) | $ / shares | $ 41.69 |
Employees' Stock Incentive Pl53
Employees' Stock Incentive Plans Additional Information (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Options, exercises in period, intrinsic value | $ 115 |
RSUs vested during the period, fair value | $ 12 |
Employees' Stock Incentive Pl54
Employees' Stock Incentive Plans Schedule of Share-Based Compensation, RSU Activity (Details) | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Roll-forward of RSU Activity (in shares) | |
Beginning balance | shares | 806,744 |
Granted | shares | 1,678,110 |
Forfeited | shares | (191,072) |
Vested | shares | (136,272) |
Ending balance | shares | 2,157,510 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
RSUs outstanding at period start, weighted average grant date fair value (in dollars per share) | $ / shares | $ 71.95 |
RSUs granted, weighted average exercise price (in dollars per share) | $ / shares | 85.03 |
RSUs forfeited, weighted average exercise price (in dollars per share) | $ / shares | 82.85 |
RSUs vested, weighted average exercise price (in dollars per share) | $ / shares | 72.96 |
RSUs outstanding at period end, weighted average grant date fair value (in dollars per share) | $ / shares | $ 81.10 |
Postemployment Benefits Pension
Postemployment Benefits Pension Plans - Components of Net Pension Cost/(Benefit) (Details) - Pension Plan - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Foreign Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 5 | $ 6 | $ 13 | $ 18 |
Interest cost | 17 | 21 | 49 | 64 |
Expected return on plan assets | (47) | (44) | (133) | (137) |
Amortization of unrecognized losses/(gains) | 0 | 0 | (1) | 0 |
Settlements | 0 | 0 | 0 | 0 |
Special/contractual termination benefits | 0 | 0 | 8 | 0 |
Other | (6) | 0 | (15) | 0 |
Net cost/(benefit) | (31) | (17) | (77) | (55) |
Domestic Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 3 | 3 | 8 | 10 |
Interest cost | 45 | 52 | 136 | 158 |
Expected return on plan assets | (66) | (73) | (197) | (221) |
Amortization of unrecognized losses/(gains) | 0 | 0 | 0 | 0 |
Settlements | 3 | 26 | 3 | 20 |
Special/contractual termination benefits | 5 | 0 | 18 | 0 |
Other | 0 | 0 | 2 | 0 |
Net cost/(benefit) | $ (10) | $ 8 | $ (30) | $ (33) |
Postemployment Benefits Postemp
Postemployment Benefits Postemployment Benefit Plans - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Jul. 01, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Postretirement Plans | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Curtailments | $ (9) | $ (168) | $ 0 | $ (177) | $ 0 |
Foreign Plan | Pension Plan | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer contribution | 24 | ||||
Estimated future employer contributions in 2017 | 5 | 5 | |||
Domestic Plan | Pension Plan | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer contribution | 150 | ||||
Estimated future employer contributions in 2017 | $ 0 | $ 0 |
Postemployment Benefits Postret
Postemployment Benefits Postretirement Plans - Components of Net Postretirement Cost/(Benefit) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Jul. 01, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | |||||
Amortization of prior service costs/(credits) | $ (247) | $ (217) | |||
Postretirement Plans | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Service cost | $ 2 | $ 3 | 7 | 11 | |
Interest cost | 12 | 13 | 37 | 43 | |
Amortization of prior service costs/(credits) | (77) | (90) | (250) | (252) | |
Curtailments | (9) | $ (168) | 0 | (177) | 0 |
Net cost/(benefit) | $ (72) | $ (74) | $ (383) | $ (198) |
Accumulated Other Comprehensi58
Accumulated Other Comprehensive Income/(Losses) Components of and Changes in Accumulated Other Comprehensive Income/(Losses) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | $ (1,628) | |||
Foreign currency translation adjustments | $ 421 | $ (148) | 1,179 | $ (294) |
Net deferred gains/(losses) on net investment hedges | (124) | 34 | (327) | 79 |
Reclassification of net postemployment benefit losses/(gains) | (51) | (39) | (260) | (143) |
Net deferred gains/(losses) on cash flow hedges | (70) | 31 | (136) | (1) |
Net deferred losses/(gains) on cash flow hedges reclassified to net income | 51 | (26) | 97 | (44) |
Ending balance | (1,085) | (1,085) | ||
Foreign Currency Translation Adjustments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (2,412) | |||
Foreign currency translation adjustments | 1,181 | |||
Net deferred gains/(losses) on net investment hedges | (327) | |||
Net postemployment benefit gains/(losses) arising during the period | 0 | |||
Reclassification of net postemployment benefit losses/(gains) | 0 | |||
Net deferred gains/(losses) on cash flow hedges | 0 | |||
Net deferred losses/(gains) on cash flow hedges reclassified to net income | 0 | |||
Total other comprehensive income/(loss) | 854 | |||
Ending balance | (1,558) | (1,558) | ||
Net Postemployment Benefit Plan Adjustments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 772 | |||
Foreign currency translation adjustments | 0 | |||
Net deferred gains/(losses) on net investment hedges | 0 | |||
Net postemployment benefit gains/(losses) arising during the period | (12) | |||
Reclassification of net postemployment benefit losses/(gains) | (260) | |||
Net deferred gains/(losses) on cash flow hedges | 0 | |||
Net deferred losses/(gains) on cash flow hedges reclassified to net income | 0 | |||
Total other comprehensive income/(loss) | (272) | |||
Ending balance | 500 | 500 | ||
Net Cash Flow Hedge Adjustments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 12 | |||
Foreign currency translation adjustments | 0 | |||
Net deferred gains/(losses) on net investment hedges | 0 | |||
Net postemployment benefit gains/(losses) arising during the period | 0 | |||
Reclassification of net postemployment benefit losses/(gains) | 0 | |||
Net deferred gains/(losses) on cash flow hedges | (136) | |||
Net deferred losses/(gains) on cash flow hedges reclassified to net income | 97 | |||
Total other comprehensive income/(loss) | (39) | |||
Ending balance | (27) | (27) | ||
AOCI Attributable to Parent | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (1,628) | |||
Foreign currency translation adjustments | 421 | (151) | 1,181 | (304) |
Net deferred gains/(losses) on net investment hedges | (124) | 34 | (327) | 79 |
Net postemployment benefit gains/(losses) arising during the period | (12) | |||
Reclassification of net postemployment benefit losses/(gains) | (51) | (39) | (260) | (143) |
Net deferred gains/(losses) on cash flow hedges | (70) | 31 | (136) | (1) |
Net deferred losses/(gains) on cash flow hedges reclassified to net income | 51 | $ (26) | 97 | $ (44) |
Total other comprehensive income/(loss) | 543 | |||
Ending balance | $ (1,085) | $ (1,085) |
Accumulated Other Comprehensi59
Accumulated Other Comprehensive Income/(Losses) Gross Amount and Related Tax Benefit/(Expense) Recorded in and Associated with each Component of Other Comprehensive Income/(Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Accumulated Other Comprehensive Income/(Loss) [Line Items] | ||||
Foreign currency translation adjustments, net of tax | $ 421 | $ (148) | $ 1,179 | $ (294) |
Net deferred gains/(losses) on net investment hedges, net of tax | (124) | 34 | (327) | 79 |
Net actuarial gains/(losses) arising during the period, net of tax | (4) | (251) | (13) | (251) |
Prior service credits/(costs) arising during the period, net of tax | 0 | 106 | 1 | 106 |
Reclassification of net postemployment benefit losses/(gains), net of tax | 51 | 39 | 260 | 143 |
Net deferred gains/(losses) on cash flow hedges, net of tax | (70) | 31 | (136) | (1) |
Net deferred losses/(gains) on cash flow hedges reclassified to net income, net of tax | 51 | (26) | 97 | (44) |
AOCI Attributable to Parent | ||||
Accumulated Other Comprehensive Income/(Loss) [Line Items] | ||||
Foreign currency translation adjustments, before tax | 421 | (151) | 1,181 | (304) |
Foreign currency translation adjustments, tax | 0 | 0 | 0 | 0 |
Foreign currency translation adjustments, net of tax | 421 | (151) | 1,181 | (304) |
Net deferred gains/(losses) on net investment hedges, before tax | (200) | 34 | (568) | 144 |
Net deferred gains/(losses) on net investment hedges, tax | 76 | 0 | 241 | (65) |
Net deferred gains/(losses) on net investment hedges, net of tax | (124) | 34 | (327) | 79 |
Net actuarial gains/(losses) arising during the period, before tax | (1) | (405) | (11) | (405) |
Net actuarial gains/(losses) arising during the period, tax | (3) | 154 | (2) | 154 |
Net actuarial gains/(losses) arising during the period, net of tax | (4) | (251) | (13) | (251) |
Prior service credits/(costs) arising during the period, before tax | 0 | 172 | 2 | 172 |
Prior service credits/(costs) arising during the period, tax | 0 | 66 | 1 | 66 |
Prior service credits/(costs) arising during the period, net of tax | 0 | 106 | 1 | 106 |
Reclassification of net postemployment benefit losses/(gains), before tax | (83) | (64) | (423) | (232) |
Reclassification of net postemployment benefit losses/(gains), tax | 32 | 25 | 163 | 89 |
Reclassification of net postemployment benefit losses/(gains), net of tax | 51 | 39 | 260 | 143 |
Net deferred gains/(losses) on cash flow hedges, before tax | (76) | 33 | (147) | (12) |
Net deferred gains/(losses) on cash flow hedges, tax | 6 | (2) | 11 | 11 |
Net deferred gains/(losses) on cash flow hedges, net of tax | (70) | 31 | (136) | (1) |
Net deferred losses/(gains) on cash flow hedges reclassified to net income, before tax | 51 | (23) | 96 | (43) |
Net deferred losses/(gains) on cash flow hedges reclassified to net income, tax | 0 | (3) | 1 | (1) |
Net deferred losses/(gains) on cash flow hedges reclassified to net income, net of tax | $ 51 | $ (26) | $ 97 | $ (44) |
Accumulated Other Comprehensi60
Accumulated Other Comprehensive Income/(Losses) Amounts Reclassified from Accumulated Other Comprehensive Income/(Losses) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | ||||
Net deferred losses/(gains) on cash flow hedges reclassified to net income, net of tax | $ 51 | $ (26) | $ 97 | $ (44) |
Reclassification of net postemployment benefit losses/(gains), net of tax | (51) | (39) | (260) | (143) |
AOCI Attributable to Parent | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | ||||
Losses/(gains) on cash flow hedges before income taxes | 51 | (23) | 96 | (43) |
Losses/(gains) on cash flow hedges, income taxes | 0 | (3) | 1 | (1) |
Net deferred losses/(gains) on cash flow hedges reclassified to net income, net of tax | 51 | (26) | 97 | (44) |
Amortization of unrecognized losses/(gains) | 0 | 0 | 1 | 0 |
Amortization of prior service costs/(credits) | (77) | (90) | (250) | (252) |
Settlement and curtailments losses/(gains) | (6) | 26 | (174) | 20 |
Losses/(gains) on postemployment benefits before income taxes | (83) | (64) | (423) | (232) |
Losses/(gains) on postemployment benefits, income taxes | 32 | 25 | 163 | 89 |
Reclassification of net postemployment benefit losses/(gains), net of tax | (51) | (39) | (260) | (143) |
AOCI Attributable to Parent | Foreign exchange contracts | Net sales | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | ||||
Losses/(gains) on cash flow hedges before income taxes | 0 | 0 | 0 | (3) |
AOCI Attributable to Parent | Foreign exchange contracts | Cost of products sold | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | ||||
Losses/(gains) on cash flow hedges before income taxes | (2) | (1) | (5) | (34) |
AOCI Attributable to Parent | Foreign exchange contracts | Other expense/(income), net | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | ||||
Losses/(gains) on cash flow hedges before income taxes | 52 | (23) | 98 | (9) |
AOCI Attributable to Parent | Interest rate contracts | Interest expense | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income/(Losses) [Line Items] | ||||
Losses/(gains) on cash flow hedges before income taxes | $ 1 | $ 1 | $ 3 | $ 3 |
Financial Instruments Outstandi
Financial Instruments Outstanding Notional Amounts (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Commodity contracts | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 332 | $ 459 |
Foreign exchange contracts | ||
Derivative [Line Items] | ||
Derivative, notional amount | 3,753 | 2,997 |
Cross-currency contracts | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 2,950 | $ 3,173 |
Financial Instruments Fair Valu
Financial Instruments Fair Values (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | $ 417 | $ 756 |
Derivative liability, fair value, gross liability | 118 | 86 |
Commodity contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 8 | 28 |
Derivative liability, fair value, gross liability | 15 | 7 |
Foreign exchange contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 9 | 69 |
Derivative liability, fair value, gross liability | 103 | 13 |
Foreign exchange contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 46 | 35 |
Derivative liability, fair value, gross liability | 0 | 30 |
Cross-currency contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 354 | 580 |
Derivative liability, fair value, gross liability | 0 | 36 |
Cross-currency contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 44 |
Derivative liability, fair value, gross liability | 0 | 0 |
Level 1 | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 8 | 28 |
Derivative liability, fair value, gross liability | 14 | 7 |
Level 1 | Commodity contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 8 | 28 |
Derivative liability, fair value, gross liability | 14 | 7 |
Level 1 | Foreign exchange contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Derivative liability, fair value, gross liability | 0 | 0 |
Level 1 | Foreign exchange contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Derivative liability, fair value, gross liability | 0 | 0 |
Level 1 | Cross-currency contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Derivative liability, fair value, gross liability | 0 | 0 |
Level 1 | Cross-currency contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Derivative liability, fair value, gross liability | 0 | 0 |
Level 2 | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 409 | 728 |
Derivative liability, fair value, gross liability | 104 | 79 |
Level 2 | Commodity contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Derivative liability, fair value, gross liability | 1 | 0 |
Level 2 | Foreign exchange contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 9 | 69 |
Derivative liability, fair value, gross liability | 103 | 13 |
Level 2 | Foreign exchange contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 46 | 35 |
Derivative liability, fair value, gross liability | 0 | 30 |
Level 2 | Cross-currency contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 354 | 580 |
Derivative liability, fair value, gross liability | 0 | 36 |
Level 2 | Cross-currency contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 44 |
Derivative liability, fair value, gross liability | 0 | 0 |
Level 3 | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Derivative liability, fair value, gross liability | 0 | 0 |
Level 3 | Commodity contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Derivative liability, fair value, gross liability | 0 | 0 |
Level 3 | Foreign exchange contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Derivative liability, fair value, gross liability | 0 | 0 |
Level 3 | Foreign exchange contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Derivative liability, fair value, gross liability | 0 | 0 |
Level 3 | Cross-currency contracts | Designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Derivative liability, fair value, gross liability | 0 | 0 |
Level 3 | Cross-currency contracts | Not designated as hedging instrument | ||
Derivatives Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Derivative liability, fair value, gross liability | $ 0 | $ 0 |
Financial Instruments Additiona
Financial Instruments Additional Information (Details) € in Millions, £ in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2017USD ($) | Oct. 02, 2016USD ($) | Sep. 30, 2017USD ($) | Oct. 02, 2016USD ($) | Sep. 30, 2017GBP (£) | Sep. 30, 2017EUR (€) | Dec. 31, 2016USD ($) | |
Derivative [Line Items] | |||||||
Derivative, collateral, right to reclaim cash | $ 56 | $ 56 | $ 67 | ||||
Derivative, collateral, obligation to return cash | 56 | 56 | $ 67 | ||||
Unrealized gain/(loss) on cash flow hedges to be reclassified during next 12 months | (21) | $ (21) | |||||
Foreign exchange contracts | Designated as hedging instrument | |||||||
Derivative [Line Items] | |||||||
Derivative, term | 18 months | ||||||
Foreign exchange contracts | Not designated as hedging instrument | |||||||
Derivative [Line Items] | |||||||
Derivative, term | 5 months | ||||||
Cross-currency contracts | Designated as hedging instrument | |||||||
Derivative [Line Items] | |||||||
Derivative, term | 27 months | ||||||
Commodity contracts | Not designated as hedging instrument | |||||||
Derivative [Line Items] | |||||||
Derivative, term | 15 months | ||||||
Net Investment Hedging | Designated as hedging instrument | |||||||
Derivative [Line Items] | |||||||
Non-derivative instruments, loss (gain) recognized in other comprehensive income (loss), net | 113 | $ 15 | $ 373 | $ (24) | |||
Net Investment Hedging | Foreign exchange contracts | Designated as hedging instrument | |||||||
Derivative [Line Items] | |||||||
Derivative liability, notional amount | $ 208 | $ 208 | |||||
Euro Member Countries, Euro | Net Investment Hedging | Debt | Designated as hedging instrument | |||||||
Derivative [Line Items] | |||||||
Derivative, amount of hedged item | € | € 2,550 | ||||||
United Kingdom, Pounds | Net Investment Hedging | Debt | Designated as hedging instrument | |||||||
Derivative [Line Items] | |||||||
Derivative, amount of hedged item | £ | £ 400 |
Financial Instruments Net Inves
Financial Instruments Net Investment Hedging (Details) - Sep. 30, 2017 € in Millions, £ in Millions, $ in Millions, CAD in Billions | USD ($) | GBP (£) | EUR (€) | CAD |
United Kingdom, Pounds | Cross-currency contracts | ||||
Derivative [Line Items] | ||||
Derivative asset, notional amount | $ 1,400 | £ 800 | ||
Canada, Dollars | Cross-currency contracts | ||||
Derivative [Line Items] | ||||
Derivative asset, notional amount | 1,600 | CAD 1.8 | ||
Net Investment Hedging | Designated as hedging instrument | Foreign exchange contracts | ||||
Derivative [Line Items] | ||||
Derivative liability, notional amount | $ | $ 208 | |||
Net Investment Hedging | Designated as hedging instrument | Euro Member Countries, Euro | Debt | ||||
Derivative [Line Items] | ||||
Derivative, amount of hedged item | € | € 2,550 | |||
Net Investment Hedging | Designated as hedging instrument | United Kingdom, Pounds | Debt | ||||
Derivative [Line Items] | ||||
Derivative, amount of hedged item | £ | £ 400 |
Financial Instruments Derivativ
Financial Instruments Derivative Impact on the Statements of Income and Statements of Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Commodity contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | $ 4 | $ (17) | $ (33) | $ (6) |
Foreign exchange contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | (23) | 20 | (38) | (15) |
Cross-currency contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 2 | (2) | (6) |
Interest rate contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | (1) | (1) | (3) | (3) |
Designated as hedging instrument | Commodity contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gains recognized in other comprehensive loss (effective portion) | 0 | 0 | 0 | 0 |
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Designated as hedging instrument | Foreign exchange contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gains recognized in other comprehensive loss (effective portion) | (82) | 33 | (165) | 42 |
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | (50) | 24 | (93) | 46 |
Designated as hedging instrument | Cross-currency contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gains recognized in other comprehensive loss (effective portion) | (81) | 49 | (177) | 74 |
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Designated as hedging instrument | Interest rate contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gains recognized in other comprehensive loss (effective portion) | 0 | 0 | 0 | (8) |
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | (1) | (1) | (3) | (3) |
Not designated as hedging instrument | Commodity contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 4 | (17) | (33) | (6) |
Not designated as hedging instrument | Foreign exchange contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 27 | (4) | 55 | (61) |
Not designated as hedging instrument | Cross-currency contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 2 | (2) | (6) |
Not designated as hedging instrument | Interest rate contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Not designated as hedging instrument | Cost of products sold | Commodity contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 4 | (17) | (33) | (6) |
Not designated as hedging instrument | Cost of products sold | Foreign exchange contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Not designated as hedging instrument | Cost of products sold | Cross-currency contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Not designated as hedging instrument | Cost of products sold | Interest rate contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Not designated as hedging instrument | Other income/(expense), net | Commodity contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Not designated as hedging instrument | Other income/(expense), net | Foreign exchange contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 27 | (4) | 55 | (61) |
Not designated as hedging instrument | Other income/(expense), net | Cross-currency contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 2 | (2) | (6) |
Not designated as hedging instrument | Other income/(expense), net | Interest rate contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Commodity contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gains recognized in other comprehensive loss (effective portion) | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Foreign exchange contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gains recognized in other comprehensive loss (effective portion) | (76) | 33 | (147) | (4) |
Cash Flow Hedging | Designated as hedging instrument | Cross-currency contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gains recognized in other comprehensive loss (effective portion) | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Interest rate contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gains recognized in other comprehensive loss (effective portion) | 0 | 0 | 0 | (8) |
Cash Flow Hedging | Designated as hedging instrument | Net sales | Commodity contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Net sales | Foreign exchange contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 3 |
Cash Flow Hedging | Designated as hedging instrument | Net sales | Cross-currency contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Net sales | Interest rate contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Cost of products sold | Commodity contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gain/(loss) recognized in income (effective portion) | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Cost of products sold | Foreign exchange contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gain/(loss) recognized in income (effective portion) | 2 | 1 | 5 | 34 |
Cash Flow Hedging | Designated as hedging instrument | Cost of products sold | Cross-currency contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gain/(loss) recognized in income (effective portion) | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Cost of products sold | Interest rate contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gain/(loss) recognized in income (effective portion) | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Other income/(expense), net | Commodity contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Other income/(expense), net | Foreign exchange contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | (52) | 23 | (98) | 9 |
Cash Flow Hedging | Designated as hedging instrument | Other income/(expense), net | Cross-currency contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Other income/(expense), net | Interest rate contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Interest expense | Commodity contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Interest expense | Foreign exchange contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Interest expense | Cross-currency contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | 0 | 0 | 0 | 0 |
Cash Flow Hedging | Designated as hedging instrument | Interest expense | Interest rate contracts | ||||
Derivatives not designated as hedging instruments: | ||||
Total amount recognized in statements of income | (1) | (1) | (3) | (3) |
Net Investment Hedging | Designated as hedging instrument | Commodity contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gains recognized in other comprehensive loss (effective portion) | 0 | 0 | 0 | 0 |
Net Investment Hedging | Designated as hedging instrument | Foreign exchange contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gains recognized in other comprehensive loss (effective portion) | (6) | 0 | (18) | 46 |
Net Investment Hedging | Designated as hedging instrument | Cross-currency contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gains recognized in other comprehensive loss (effective portion) | (81) | 49 | (177) | 74 |
Net Investment Hedging | Designated as hedging instrument | Interest rate contracts | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Net gains recognized in other comprehensive loss (effective portion) | $ 0 | $ 0 | $ 0 | $ 0 |
Financing Arrangements Addition
Financing Arrangements Additional Information (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Transfers and Servicing [Abstract] | ||
Receivables derecognized under accounts receivable factoring programs | $ 1,100 | $ 1,000 |
Sold receivables | $ 427 | $ 129 |
Venezuela - Foreign Currency 67
Venezuela - Foreign Currency and Inflation Additional Information (Details) $ in Millions | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2017USD ($)exchange_rateVEF / $ | Oct. 02, 2016USD ($) | Jul. 03, 2016USD ($) | Sep. 30, 2017USD ($)exchange_rateVEF / $ | Oct. 02, 2016USD ($) | May 30, 2017VEF / $ | Mar. 09, 2016VEF / $ | |
Foreign Currency [Line Items] | |||||||
Number of exchange rates legally available to us in Venezuela | exchange_rate | 2 | 2 | |||||
Outstanding requests for currency settlements at the official exchange rate | $ | $ 26 | $ 26 | |||||
Foreign currency translation loss/(gain) | $ | $ 3 | $ (6) | $ 36 | $ 1 | |||
Impairment of long-lived assets held-for-use | $ | $ 53 | ||||||
Official CENCOEX BsF Rate | |||||||
Foreign Currency [Line Items] | |||||||
Foreign currency exchange rate, translation | 10 | 10 | 6.30 | ||||
Venezuelan BsF on DICOM Market, first auction spot rate | |||||||
Foreign Currency [Line Items] | |||||||
Foreign currency exchange rate, translation | 2,010 | ||||||
Venezuelan BsF on DICOM market, quarter-to-date average | |||||||
Foreign Currency [Line Items] | |||||||
Foreign currency exchange rate, translation | 3,030 | 3,030 | |||||
Venezuelan BsF on DICOM market, year-to-date average | |||||||
Foreign Currency [Line Items] | |||||||
Foreign currency exchange rate, translation | 1,707 | 1,707 | |||||
Venezuelan BsF on DICOM market, period end spot | |||||||
Foreign Currency [Line Items] | |||||||
Foreign currency exchange rate, translation | 3,345 | 3,345 |
Commitments, Contingencies an68
Commitments, Contingencies and Debt Borrowing Arrangements (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Debt Disclosure [Abstract] | ||
Commercial paper | $ 443 | $ 642 |
Commitments, Contingencies an69
Commitments, Contingencies and Debt Long-Term Debt (Details) - USD ($) $ in Millions | Jun. 07, 2013 | Sep. 30, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | |||
Debt issuance costs | $ 52 | ||
Repayments of aggregate principle amount of senior notes | $ 2,000 | ||
Nine point zero zero percent cumulative compounding preferred stock, Series A | Berkshire Hathaway | |||
Debt Instrument [Line Items] | |||
9.00% cumulative compounding preferred stock, Series A, dividend percentage | 9.00% | ||
Floating rate senior notes due 2019 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 350 | ||
Floating rate senior notes due 2021 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 650 | ||
Floating rate senior notes due 2022 | |||
Debt Instrument [Line Items] | |||
Long-term debt | 500 | ||
Two point one one four percent senior unsecured loan due July 6, 2022 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 600 |
Commitments, Contingencies an70
Commitments, Contingencies and Debt Fair Value of Debt (Details) - USD ($) $ in Billions | Sep. 30, 2017 | Dec. 31, 2016 |
Debt Disclosure [Abstract] | ||
Fair value of total debt | $ 32.9 | $ 33.2 |
Carrying value of total debt | $ 31.5 | $ 32.4 |
Earnings Per Share Basic and Di
Earnings Per Share Basic and Diluted Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Basic EPS | ||||
Net income/(loss) attributable to common shareholders | $ 944 | $ 842 | $ 2,996 | $ 2,508 |
Weighted average shares of common stock outstanding (in shares) | 1,218 | 1,218 | 1,218 | 1,216 |
Basic earnings/(loss) per share (in dollars per share) | $ 0.78 | $ 0.69 | $ 2.46 | $ 2.06 |
Diluted EPS | ||||
Net earnings/(loss) attributable to common shareholders | $ 944 | $ 842 | $ 2,996 | $ 2,508 |
Effect of dilutive stock options on basic earnings/(loss) per common share (in shares) | 10 | 10 | 11 | 10 |
Weighted average shares of common stock, including dilutive effect (in shares) | 1,228 | 1,228 | 1,229 | 1,226 |
Diluted earnings/(loss) per share (in dollars per share) | $ 0.77 | $ 0.69 | $ 2.44 | $ 2.05 |
Earnings Per Share Additional I
Earnings Per Share Additional Information (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Earnings Per Share [Abstract] | ||||
Anti-dilutive shares | 2 | 1 | 1 | 3 |
Segment Reporting Additional In
Segment Reporting Additional Information (Details) | 9 Months Ended |
Sep. 30, 2017segment | |
Segment Reporting [Abstract] | |
Number of segments | 4 |
Number of reportable segments | 3 |
Number of operating segments in Rest of World reportable segment | 2 |
Segment Reporting Net Sales by
Segment Reporting Net Sales by Segment (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Segment Reporting Information [Line Items] | ||||
Net sales | $ 6,314 | $ 6,267 | $ 19,355 | $ 19,630 |
United States | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 4,380 | 4,395 | 13,566 | 13,802 |
Canada | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 559 | 550 | 1,599 | 1,692 |
Europe | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 599 | 558 | 1,737 | 1,766 |
Rest of World | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | $ 776 | $ 764 | $ 2,453 | $ 2,370 |
Segment Reporting Segment Adjus
Segment Reporting Segment Adjusted EBITDA (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Segment Reporting Information [Line Items] | ||||
General corporate expenses | $ (28) | $ (30) | $ (93) | $ (115) |
Depreciation and amortization (excluding integration and restructuring expenses) | (165) | (116) | (434) | (401) |
Integration and restructuring expenses | (95) | 237 | 237 | 781 |
Merger costs | 0 | (4) | 0 | (33) |
Unrealized gains/(losses) on commodity hedges | 5 | (22) | (24) | 23 |
Impairment losses | (1) | 0 | (49) | (53) |
Nonmonetary currency devaluation | 0 | (1) | 0 | (4) |
Equity award compensation expense (excluding integration and restructuring expenses) | (12) | (10) | (38) | (30) |
Operating income | 1,661 | 1,413 | 5,133 | 4,562 |
Interest expense | 306 | 311 | 926 | 824 |
Other expense/(income), net | (4) | (3) | 8 | (5) |
Income/(loss) before income taxes | 1,359 | 1,105 | 4,199 | 3,743 |
United States | ||||
Segment Reporting Information [Line Items] | ||||
Segment Adjusted EBITDA | 1,440 | 1,349 | 4,478 | 4,360 |
Canada | ||||
Segment Reporting Information [Line Items] | ||||
Segment Adjusted EBITDA | 162 | 148 | 477 | 491 |
Europe | ||||
Segment Reporting Information [Line Items] | ||||
Segment Adjusted EBITDA | 206 | 191 | 578 | 592 |
Rest of World | ||||
Segment Reporting Information [Line Items] | ||||
Segment Adjusted EBITDA | $ 149 | $ 145 | $ 475 | $ 513 |
Segment Reporting Net Sales b76
Segment Reporting Net Sales by Product (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Revenue from External Customer [Line Items] | ||||
Net sales | $ 6,314 | $ 6,267 | $ 19,355 | $ 19,630 |
Condiments and sauces | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 1,568 | 1,562 | 4,791 | 4,886 |
Cheese and dairy | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 1,283 | 1,288 | 3,901 | 4,004 |
Ambient meals | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 571 | 577 | 1,695 | 1,726 |
Frozen and chilled meals | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 642 | 642 | 1,934 | 1,895 |
Meats and seafood | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 663 | 670 | 2,018 | 2,093 |
Refreshment beverages | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 371 | 368 | 1,180 | 1,218 |
Coffee | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 331 | 337 | 1,021 | 1,076 |
Infant and nutrition | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 176 | 171 | 575 | 577 |
Desserts, toppings and baking | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 220 | 216 | 649 | 661 |
Nuts and salted snacks | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 202 | 237 | 686 | 752 |
Other | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | $ 287 | $ 199 | $ 905 | $ 742 |
Supplemental Financial Inform77
Supplemental Financial Information Condensed Consolidating Statements of Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Oct. 02, 2016 | Sep. 30, 2017 | Oct. 02, 2016 | |
Condensed Income Statements, Captions [Line Items] | ||||
Net sales | $ 6,314 | $ 6,267 | $ 19,355 | $ 19,630 |
Cost of products sold | 4,000 | 4,049 | 12,059 | 12,503 |
Gross profit | 2,314 | 2,218 | 7,296 | 7,127 |
Selling, general and administrative expenses | 653 | 805 | 2,163 | 2,565 |
Intercompany service fees and other recharges | 0 | 0 | 0 | 0 |
Operating income | 1,661 | 1,413 | 5,133 | 4,562 |
Interest expense | 306 | 311 | 926 | 824 |
Other expense/(income), net | (4) | (3) | 8 | (5) |
Income/(loss) before income taxes | 1,359 | 1,105 | 4,199 | 3,743 |
Provision for/(benefit from) income taxes | 416 | 262 | 1,205 | 1,045 |
Equity in earnings of subsidiaries | 0 | 0 | 0 | 0 |
Net income/(loss) | 943 | 843 | 2,994 | 2,698 |
Net income/(loss) attributable to noncontrolling interest | (1) | 1 | (2) | 10 |
Net income/(loss) excluding noncontrolling interest | 944 | 842 | 2,996 | 2,688 |
Comprehensive income/(loss) excluding noncontrolling interest | 1,167 | 547 | 3,539 | 2,131 |
Eliminations | ||||
Condensed Income Statements, Captions [Line Items] | ||||
Net sales | (142) | (172) | (442) | (474) |
Cost of products sold | (142) | (172) | (442) | (474) |
Gross profit | 0 | 0 | 0 | 0 |
Selling, general and administrative expenses | 0 | 0 | 0 | 0 |
Intercompany service fees and other recharges | 0 | 0 | 0 | 0 |
Operating income | 0 | 0 | 0 | 0 |
Interest expense | 0 | 0 | 0 | 0 |
Other expense/(income), net | 0 | 0 | 0 | 0 |
Income/(loss) before income taxes | 0 | 0 | 0 | 0 |
Provision for/(benefit from) income taxes | 0 | 0 | 0 | 0 |
Equity in earnings of subsidiaries | (1,558) | (1,242) | (5,380) | (5,090) |
Net income/(loss) | (1,558) | (1,242) | (5,380) | (5,090) |
Net income/(loss) attributable to noncontrolling interest | 0 | 0 | 0 | 0 |
Net income/(loss) excluding noncontrolling interest | (1,558) | (1,242) | (5,380) | (5,090) |
Comprehensive income/(loss) excluding noncontrolling interest | (2,332) | (832) | (7,890) | (4,144) |
Parent Guarantor | Reportable Legal Entities | ||||
Condensed Income Statements, Captions [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Cost of products sold | 0 | 0 | 0 | 0 |
Gross profit | 0 | 0 | 0 | 0 |
Selling, general and administrative expenses | 0 | 0 | 0 | 0 |
Intercompany service fees and other recharges | 0 | 0 | 0 | 0 |
Operating income | 0 | 0 | 0 | 0 |
Interest expense | 0 | 0 | 0 | 0 |
Other expense/(income), net | 0 | 0 | 0 | 0 |
Income/(loss) before income taxes | 0 | 0 | 0 | 0 |
Provision for/(benefit from) income taxes | 0 | 0 | 0 | 0 |
Equity in earnings of subsidiaries | 944 | 842 | 2,996 | 2,688 |
Net income/(loss) | 944 | 842 | 2,996 | 2,688 |
Net income/(loss) attributable to noncontrolling interest | 0 | 0 | 0 | 0 |
Net income/(loss) excluding noncontrolling interest | 944 | 842 | 2,996 | 2,688 |
Comprehensive income/(loss) excluding noncontrolling interest | 1,167 | 547 | 3,539 | 2,131 |
Subsidiary Issuer | Reportable Legal Entities | ||||
Condensed Income Statements, Captions [Line Items] | ||||
Net sales | 4,170 | 4,206 | 12,941 | 13,156 |
Cost of products sold | 2,601 | 2,700 | 7,825 | 8,273 |
Gross profit | 1,569 | 1,506 | 5,116 | 4,883 |
Selling, general and administrative expenses | 155 | 194 | 504 | 778 |
Intercompany service fees and other recharges | 776 | 795 | 3,205 | 3,320 |
Operating income | 638 | 517 | 1,407 | 785 |
Interest expense | 296 | 294 | 895 | 782 |
Other expense/(income), net | 23 | (20) | (8) | 66 |
Income/(loss) before income taxes | 319 | 243 | 520 | (63) |
Provision for/(benefit from) income taxes | (11) | (199) | (92) | (349) |
Equity in earnings of subsidiaries | 614 | 400 | 2,384 | 2,402 |
Net income/(loss) | 944 | 842 | 2,996 | 2,688 |
Net income/(loss) attributable to noncontrolling interest | 0 | 0 | 0 | 0 |
Net income/(loss) excluding noncontrolling interest | 944 | 842 | 2,996 | 2,688 |
Comprehensive income/(loss) excluding noncontrolling interest | 1,167 | 547 | 3,539 | 2,131 |
Non-Guarantor Subsidiaries | Reportable Legal Entities | ||||
Condensed Income Statements, Captions [Line Items] | ||||
Net sales | 2,286 | 2,233 | 6,856 | 6,948 |
Cost of products sold | 1,541 | 1,521 | 4,676 | 4,704 |
Gross profit | 745 | 712 | 2,180 | 2,244 |
Selling, general and administrative expenses | 498 | 611 | 1,659 | 1,787 |
Intercompany service fees and other recharges | (776) | (795) | (3,205) | (3,320) |
Operating income | 1,023 | 896 | 3,726 | 3,777 |
Interest expense | 10 | 17 | 31 | 42 |
Other expense/(income), net | (27) | 17 | 16 | (71) |
Income/(loss) before income taxes | 1,040 | 862 | 3,679 | 3,806 |
Provision for/(benefit from) income taxes | 427 | 461 | 1,297 | 1,394 |
Equity in earnings of subsidiaries | 0 | 0 | 0 | 0 |
Net income/(loss) | 613 | 401 | 2,382 | 2,412 |
Net income/(loss) attributable to noncontrolling interest | (1) | 1 | (2) | 10 |
Net income/(loss) excluding noncontrolling interest | 614 | 400 | 2,384 | 2,402 |
Comprehensive income/(loss) excluding noncontrolling interest | $ 1,165 | $ 285 | $ 4,351 | $ 2,013 |
Supplemental Financial Inform78
Supplemental Financial Information Condensed Consolidating Balance Sheets (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Cash and cash equivalents | $ 1,441 | $ 4,204 |
Trade receivables | 938 | 769 |
Receivables due from affiliates | 0 | 0 |
Dividends due from affiliates | 0 | 0 |
Sold receivables | 427 | 129 |
Inventories | 3,188 | 2,684 |
Short-term lending due from affiliates | 0 | 0 |
Other current assets | 1,234 | 967 |
Total current assets | 7,228 | 8,753 |
Property, plant and equipment, net | 6,934 | 6,688 |
Goodwill | 44,858 | 44,125 |
Investments in subsidiaries | 0 | 0 |
Intangible assets, net | 59,500 | 59,297 |
Long-term lending due from affiliates | 0 | 0 |
Other assets | 1,531 | 1,617 |
TOTAL ASSETS | 120,051 | 120,480 |
Commercial paper and other short-term debt | 455 | 645 |
Current portion of long-term debt | 2,755 | 2,046 |
Short-term lending due to affiliates | 0 | 0 |
Trade payables | 3,947 | 3,996 |
Payables due to affiliates | 0 | 0 |
Accrued marketing | 493 | 749 |
Accrued postemployment costs | 158 | 157 |
Income taxes payable | 169 | 255 |
Interest payable | 295 | 415 |
Dividends due to affiliates | 0 | 0 |
Other current liabilities | 1,115 | 1,238 |
Total current liabilities | 9,387 | 9,501 |
Long-term debt | 28,299 | 29,713 |
Long-term borrowings due to affiliates | 0 | 0 |
Deferred income taxes | 20,898 | 20,848 |
Accrued postemployment costs | 1,808 | 2,038 |
Other liabilities | 688 | 806 |
TOTAL LIABILITIES | 61,080 | 62,906 |
Total shareholders' equity | 58,759 | 57,358 |
Noncontrolling interest | 212 | 216 |
TOTAL EQUITY | 58,971 | 57,574 |
TOTAL LIABILITIES AND EQUITY | 120,051 | 120,480 |
Eliminations | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Cash and cash equivalents | 0 | 0 |
Trade receivables | 0 | 0 |
Receivables due from affiliates | (930) | (823) |
Dividends due from affiliates | (101) | (39) |
Sold receivables | 0 | 0 |
Inventories | 0 | 0 |
Short-term lending due from affiliates | (5,611) | (4,678) |
Other current assets | (2,386) | (1,709) |
Total current assets | (9,028) | (7,249) |
Property, plant and equipment, net | 0 | 0 |
Goodwill | 0 | 0 |
Investments in subsidiaries | (130,855) | (128,235) |
Intangible assets, net | 0 | 0 |
Long-term lending due from affiliates | (3,700) | (3,700) |
Other assets | 0 | 0 |
TOTAL ASSETS | (143,583) | (139,184) |
Commercial paper and other short-term debt | 0 | 0 |
Current portion of long-term debt | 0 | 0 |
Short-term lending due to affiliates | (5,611) | (4,678) |
Trade payables | 0 | 0 |
Payables due to affiliates | (930) | (823) |
Accrued marketing | 0 | 0 |
Accrued postemployment costs | 0 | 0 |
Income taxes payable | (2,386) | (1,709) |
Interest payable | 0 | 0 |
Dividends due to affiliates | (101) | (39) |
Other current liabilities | 0 | 0 |
Total current liabilities | (9,028) | (7,249) |
Long-term debt | 0 | 0 |
Long-term borrowings due to affiliates | (3,921) | (3,902) |
Deferred income taxes | 0 | 0 |
Accrued postemployment costs | 0 | 0 |
Other liabilities | 0 | 0 |
TOTAL LIABILITIES | (12,949) | (11,151) |
Total shareholders' equity | (130,634) | (128,033) |
Noncontrolling interest | 0 | 0 |
TOTAL EQUITY | (130,634) | (128,033) |
TOTAL LIABILITIES AND EQUITY | (143,583) | (139,184) |
Parent Guarantor | Reportable Legal Entities | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Cash and cash equivalents | 0 | 0 |
Trade receivables | 0 | 0 |
Receivables due from affiliates | 0 | |
Dividends due from affiliates | 101 | 39 |
Sold receivables | 0 | 0 |
Inventories | 0 | 0 |
Short-term lending due from affiliates | 0 | 0 |
Other current assets | 0 | 0 |
Total current assets | 101 | 39 |
Property, plant and equipment, net | 0 | 0 |
Goodwill | 0 | 0 |
Investments in subsidiaries | 58,759 | 57,358 |
Intangible assets, net | 0 | 0 |
Long-term lending due from affiliates | 0 | 0 |
Other assets | 0 | 0 |
TOTAL ASSETS | 58,860 | 57,397 |
Commercial paper and other short-term debt | 0 | 0 |
Current portion of long-term debt | 0 | 0 |
Short-term lending due to affiliates | 0 | 0 |
Trade payables | 0 | 0 |
Payables due to affiliates | 0 | 0 |
Accrued marketing | 0 | 0 |
Accrued postemployment costs | 0 | 0 |
Income taxes payable | 0 | 0 |
Interest payable | 0 | 0 |
Dividends due to affiliates | 0 | 0 |
Other current liabilities | 101 | 39 |
Total current liabilities | 101 | 39 |
Long-term debt | 0 | 0 |
Long-term borrowings due to affiliates | 0 | 0 |
Deferred income taxes | 0 | 0 |
Accrued postemployment costs | 0 | 0 |
Other liabilities | 0 | 0 |
TOTAL LIABILITIES | 101 | 39 |
Total shareholders' equity | 58,759 | 57,358 |
Noncontrolling interest | 0 | 0 |
TOTAL EQUITY | 58,759 | 57,358 |
TOTAL LIABILITIES AND EQUITY | 58,860 | 57,397 |
Subsidiary Issuer | Reportable Legal Entities | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Cash and cash equivalents | 217 | 2,830 |
Trade receivables | 4 | 12 |
Receivables due from affiliates | 725 | 712 |
Dividends due from affiliates | 0 | 0 |
Sold receivables | 0 | 0 |
Inventories | 2,087 | 1,759 |
Short-term lending due from affiliates | 2,098 | 1,722 |
Other current assets | 3,229 | 2,229 |
Total current assets | 8,360 | 9,264 |
Property, plant and equipment, net | 4,506 | 4,447 |
Goodwill | 11,067 | 11,067 |
Investments in subsidiaries | 72,096 | 70,877 |
Intangible assets, net | 3,258 | 3,364 |
Long-term lending due from affiliates | 1,700 | 1,700 |
Other assets | 499 | 501 |
TOTAL ASSETS | 101,486 | 101,220 |
Commercial paper and other short-term debt | 443 | 642 |
Current portion of long-term debt | 2,583 | 2,032 |
Short-term lending due to affiliates | 3,513 | 2,956 |
Trade payables | 2,324 | 2,376 |
Payables due to affiliates | 205 | 111 |
Accrued marketing | 124 | 277 |
Accrued postemployment costs | 84 | 144 |
Income taxes payable | 0 | 0 |
Interest payable | 284 | 401 |
Dividends due to affiliates | 101 | 39 |
Other current liabilities | 497 | 588 |
Total current liabilities | 10,158 | 9,566 |
Long-term debt | 27,396 | 28,736 |
Long-term borrowings due to affiliates | 2,000 | 2,000 |
Deferred income taxes | 1,368 | 1,382 |
Accrued postemployment costs | 1,508 | 1,754 |
Other liabilities | 297 | 424 |
TOTAL LIABILITIES | 42,727 | 43,862 |
Total shareholders' equity | 58,759 | 57,358 |
Noncontrolling interest | 0 | 0 |
TOTAL EQUITY | 58,759 | 57,358 |
TOTAL LIABILITIES AND EQUITY | 101,486 | 101,220 |
Non-Guarantor Subsidiaries | Reportable Legal Entities | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Cash and cash equivalents | 1,224 | 1,374 |
Trade receivables | 934 | 757 |
Receivables due from affiliates | 205 | 111 |
Dividends due from affiliates | 0 | 0 |
Sold receivables | 427 | 129 |
Inventories | 1,101 | 925 |
Short-term lending due from affiliates | 3,513 | 2,956 |
Other current assets | 391 | 447 |
Total current assets | 7,795 | 6,699 |
Property, plant and equipment, net | 2,428 | 2,241 |
Goodwill | 33,791 | 33,058 |
Investments in subsidiaries | 0 | 0 |
Intangible assets, net | 56,242 | 55,933 |
Long-term lending due from affiliates | 2,000 | 2,000 |
Other assets | 1,032 | 1,116 |
TOTAL ASSETS | 103,288 | 101,047 |
Commercial paper and other short-term debt | 12 | 3 |
Current portion of long-term debt | 172 | 14 |
Short-term lending due to affiliates | 2,098 | 1,722 |
Trade payables | 1,623 | 1,620 |
Payables due to affiliates | 725 | 712 |
Accrued marketing | 369 | 472 |
Accrued postemployment costs | 74 | 13 |
Income taxes payable | 2,555 | 1,964 |
Interest payable | 11 | 14 |
Dividends due to affiliates | 0 | 0 |
Other current liabilities | 517 | 611 |
Total current liabilities | 8,156 | 7,145 |
Long-term debt | 903 | 977 |
Long-term borrowings due to affiliates | 1,921 | 1,902 |
Deferred income taxes | 19,530 | 19,466 |
Accrued postemployment costs | 300 | 284 |
Other liabilities | 391 | 382 |
TOTAL LIABILITIES | 31,201 | 30,156 |
Total shareholders' equity | 71,875 | 70,675 |
Noncontrolling interest | 212 | 216 |
TOTAL EQUITY | 72,087 | 70,891 |
TOTAL LIABILITIES AND EQUITY | $ 103,288 | $ 101,047 |
Supplemental Financial Inform79
Supplemental Financial Information Condensed Consolidating Statements of Cash Flows (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2017 | Oct. 02, 2016 | Dec. 31, 2016 | |
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net cash provided by/(used for) operating activities | $ 16 | $ 1,016 | |
Cash receipts on sold receivables | 1,633 | 1,850 | |
Capital expenditures | (956) | (836) | |
Net proceeds from/(payments on) intercompany lending activities | 0 | 0 | |
Additional investments in subsidiaries | 0 | 0 | |
Return of capital | 0 | ||
Other investing activities, net | 47 | 70 | |
Net cash provided by/(used for) investing activities | 724 | 1,084 | |
Repayments of long-term debt | (2,636) | (74) | |
Proceeds from issuance of long-term debt | 1,496 | 6,981 | |
Proceeds from issuance of commercial paper | 5,495 | 4,296 | |
Repayments of commercial paper | (5,709) | (3,660) | |
Net proceeds from/(payments on) intercompany borrowing activities | 0 | 0 | |
Dividends paid-Series A Preferred Stock | 0 | (180) | |
Dividends paid-common stock | (2,161) | (2,123) | |
Redemption of Series A Preferred Stock | 0 | (8,320) | |
Other intercompany capital stock transactions | 0 | 0 | |
Other financing activities, net | 26 | 56 | |
Net cash provided by/(used for) financing activities | (3,489) | (3,024) | |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 43 | (17) | |
Net increase/(decrease) | (2,706) | (941) | |
Balance at beginning of period | 4,255 | 4,912 | $ 4,912 |
Balance at end of period | 1,549 | 3,971 | 4,255 |
Eliminations | |||
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net cash provided by/(used for) operating activities | (2,161) | (1,636) | |
Cash receipts on sold receivables | 0 | 0 | |
Capital expenditures | 0 | 0 | |
Net proceeds from/(payments on) intercompany lending activities | 208 | (491) | |
Additional investments in subsidiaries | 15 | 10 | |
Return of capital | (8,987) | ||
Other investing activities, net | 0 | 0 | |
Net cash provided by/(used for) investing activities | 223 | (9,468) | |
Repayments of long-term debt | 0 | 0 | |
Proceeds from issuance of long-term debt | 0 | 0 | |
Proceeds from issuance of commercial paper | 0 | 0 | |
Repayments of commercial paper | 0 | 0 | |
Net proceeds from/(payments on) intercompany borrowing activities | (208) | 491 | |
Dividends paid-Series A Preferred Stock | 0 | ||
Dividends paid-common stock | 2,161 | 2,303 | |
Redemption of Series A Preferred Stock | 0 | ||
Other intercompany capital stock transactions | (15) | 8,310 | |
Other financing activities, net | 0 | 0 | |
Net cash provided by/(used for) financing activities | 1,938 | 11,104 | |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 0 | 0 | |
Net increase/(decrease) | 0 | 0 | |
Balance at beginning of period | 0 | 0 | 0 |
Balance at end of period | 0 | 0 | 0 |
Parent Guarantor | Reportable Legal Entities | |||
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net cash provided by/(used for) operating activities | 2,161 | 1,636 | |
Cash receipts on sold receivables | 0 | 0 | |
Capital expenditures | 0 | 0 | |
Net proceeds from/(payments on) intercompany lending activities | 0 | 0 | |
Additional investments in subsidiaries | (15) | 0 | |
Return of capital | 8,987 | ||
Other investing activities, net | 0 | 0 | |
Net cash provided by/(used for) investing activities | (15) | 8,987 | |
Repayments of long-term debt | 0 | 0 | |
Proceeds from issuance of long-term debt | 0 | 0 | |
Proceeds from issuance of commercial paper | 0 | 0 | |
Repayments of commercial paper | 0 | 0 | |
Net proceeds from/(payments on) intercompany borrowing activities | 0 | 0 | |
Dividends paid-Series A Preferred Stock | (180) | ||
Dividends paid-common stock | (2,161) | (2,123) | |
Redemption of Series A Preferred Stock | (8,320) | ||
Other intercompany capital stock transactions | 0 | 0 | |
Other financing activities, net | 15 | 0 | |
Net cash provided by/(used for) financing activities | (2,146) | (10,623) | |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 0 | 0 | |
Net increase/(decrease) | 0 | 0 | |
Balance at beginning of period | 0 | 0 | 0 |
Balance at end of period | 0 | 0 | 0 |
Subsidiary Issuer | Reportable Legal Entities | |||
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net cash provided by/(used for) operating activities | 1,185 | 1,821 | |
Cash receipts on sold receivables | 0 | 0 | |
Capital expenditures | (622) | (605) | |
Net proceeds from/(payments on) intercompany lending activities | 59 | 565 | |
Additional investments in subsidiaries | 0 | (10) | |
Return of capital | 0 | ||
Other investing activities, net | 54 | 100 | |
Net cash provided by/(used for) investing activities | (509) | 50 | |
Repayments of long-term debt | (2,625) | (69) | |
Proceeds from issuance of long-term debt | 1,496 | 6,978 | |
Proceeds from issuance of commercial paper | 5,495 | 4,296 | |
Repayments of commercial paper | (5,709) | (3,660) | |
Net proceeds from/(payments on) intercompany borrowing activities | 267 | 74 | |
Dividends paid-Series A Preferred Stock | 0 | ||
Dividends paid-common stock | (2,161) | (2,303) | |
Redemption of Series A Preferred Stock | 0 | ||
Other intercompany capital stock transactions | 15 | (8,320) | |
Other financing activities, net | (6) | 50 | |
Net cash provided by/(used for) financing activities | (3,228) | (2,954) | |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 0 | 0 | |
Net increase/(decrease) | (2,552) | (1,083) | |
Balance at beginning of period | 2,869 | 3,253 | 3,253 |
Balance at end of period | 317 | 2,170 | 2,869 |
Non-Guarantor Subsidiaries | Reportable Legal Entities | |||
Condensed Cash Flow Statements, Captions [Line Items] | |||
Net cash provided by/(used for) operating activities | (1,169) | (805) | |
Cash receipts on sold receivables | 1,633 | 1,850 | |
Capital expenditures | (334) | (231) | |
Net proceeds from/(payments on) intercompany lending activities | (267) | (74) | |
Additional investments in subsidiaries | 0 | 0 | |
Return of capital | 0 | ||
Other investing activities, net | (7) | (30) | |
Net cash provided by/(used for) investing activities | 1,025 | 1,515 | |
Repayments of long-term debt | (11) | (5) | |
Proceeds from issuance of long-term debt | 0 | 3 | |
Proceeds from issuance of commercial paper | 0 | 0 | |
Repayments of commercial paper | 0 | 0 | |
Net proceeds from/(payments on) intercompany borrowing activities | (59) | (565) | |
Dividends paid-Series A Preferred Stock | 0 | ||
Dividends paid-common stock | 0 | 0 | |
Redemption of Series A Preferred Stock | 0 | ||
Other intercompany capital stock transactions | 0 | 10 | |
Other financing activities, net | 17 | 6 | |
Net cash provided by/(used for) financing activities | (53) | (551) | |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 43 | (17) | |
Net increase/(decrease) | (154) | 142 | |
Balance at beginning of period | 1,386 | 1,659 | 1,659 |
Balance at end of period | $ 1,232 | $ 1,801 | $ 1,386 |
Supplemental Financial Inform80
Supplemental Financial Information Reconciliation From Cash and Cash Equivalents to Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 | Oct. 02, 2016 | Jan. 03, 2016 |
Schedule of Cash, Cash Equivalents, and Restricted Cash [Line Items] | ||||
Cash and cash equivalents | $ 1,441 | $ 4,204 | ||
Restricted cash included in other assets (current) | 108 | 42 | ||
Restricted cash included in other assets (noncurrent) | 0 | 9 | ||
Cash, cash equivalents, and restricted cash | 1,549 | 4,255 | $ 3,971 | $ 4,912 |
Eliminations | ||||
Schedule of Cash, Cash Equivalents, and Restricted Cash [Line Items] | ||||
Cash and cash equivalents | 0 | 0 | ||
Restricted cash included in other assets (current) | 0 | 0 | ||
Restricted cash included in other assets (noncurrent) | 0 | |||
Cash, cash equivalents, and restricted cash | 0 | 0 | 0 | 0 |
Parent Guarantor | Reportable Legal Entities | ||||
Schedule of Cash, Cash Equivalents, and Restricted Cash [Line Items] | ||||
Cash and cash equivalents | 0 | 0 | ||
Restricted cash included in other assets (current) | 0 | 0 | ||
Restricted cash included in other assets (noncurrent) | 0 | |||
Cash, cash equivalents, and restricted cash | 0 | 0 | 0 | 0 |
Subsidiary Issuer | Reportable Legal Entities | ||||
Schedule of Cash, Cash Equivalents, and Restricted Cash [Line Items] | ||||
Cash and cash equivalents | 217 | 2,830 | ||
Restricted cash included in other assets (current) | 100 | 39 | ||
Restricted cash included in other assets (noncurrent) | 0 | |||
Cash, cash equivalents, and restricted cash | 317 | 2,869 | 2,170 | 3,253 |
Non-Guarantor Subsidiaries | Reportable Legal Entities | ||||
Schedule of Cash, Cash Equivalents, and Restricted Cash [Line Items] | ||||
Cash and cash equivalents | 1,224 | 1,374 | ||
Restricted cash included in other assets (current) | 8 | 3 | ||
Restricted cash included in other assets (noncurrent) | 9 | |||
Cash, cash equivalents, and restricted cash | $ 1,232 | $ 1,386 | $ 1,801 | $ 1,659 |