EX-99.2 3 w51511exv99w2.htm CAMPBELL SOUP COMPANY UNAUDITED PRO FORMA FINANCIAL INFORMATION exv99w2
 

EXHIBIT 99.2
Campbell Soup Company
Unaudited Pro Forma Condensed Consolidated Financial Statements
The unaudited pro forma condensed consolidated financial statements present financial information to give effect to the sale of the Godiva Chocolatier business to be accounted for in accordance with Statement of Financial Accounting Standard No. 144, Accounting for the Impairment or Disposal of Long-lived Assets. The unaudited pro forma condensed consolidated statements of earnings present the consolidated results of continuing operations of the company, assuming the sale occurred as of August 2, 2004. The impact of the anticipated use of net proceeds to repurchase shares is included in the unaudited pro forma condensed consolidated statements of earnings for the six months ended January 27, 2008 and the year ended July 29, 2007. The unaudited pro forma condensed consolidated balance sheet as of January 27, 2008 presents the consolidated financial position of the company, assuming the sale occurred on that date. Beginning with the second quarter ended January 27, 2008, the company reported the results of the Godiva Chocolatier business as discontinued operations. As of January 27, 2008, the assets and liabilities of the business were classified as assets and liabilities of discontinued operations held for sale. The unaudited financial information is subject to the assumptions and adjustments in the notes accompanying the unaudited pro forma condensed consolidated financial statements.
The unaudited pro forma condensed consolidated financial statements include specific assumptions and adjustments related to the sale of the businesses. The adjustments are based upon presently available information and assumptions that management believes are reasonable under the circumstances as of the date of this filing. However, actual adjustments may differ materially from the information presented. The unaudited pro forma condensed consolidated financial statements, including notes thereto, should be read in conjunction with the historical financial statements of the company included in its Annual Report on Form 10-K for the year ended July 29, 2007 and the unaudited financial statements filed in its Quarterly Report on Form 10-Q for the three and six months ended January 27, 2008.
The unaudited pro forma condensed consolidated financial information presented is for informational purposes only. It is not intended to represent or be indicative of the consolidated results of operations or financial position that would have occurred had the sale been completed as of the dates presented nor is it intended to be indicative of future results of operations or financial position.

 

 

CAMPBELL SOUP COMPANY CONSOLIDATED
Pro Forma Consolidated Statement of Earnings
(unaudited)
(millions, except per share amounts)
                         
    Six Months Ended January 27, 2008
    Continuing        
    Operations   Pro Forma   Pro Forma
    As Reported (A)   Adjustments (B)   Adjusted
 
 
Net sales
   $ 4,403             $ 4,403  
 
 
                        
Costs and expenses
                        
Cost of products sold
     2,622               2,622  
Marketing and selling expenses
     615               615  
Administrative expenses
     282               282  
Research and development expenses
     52               52  
Other expenses
     4               4  
 
Total costs and expenses
     3,575               3,575  
 
Earnings before interest and taxes
     828               828  
Interest, net
     84               84  
 
Earnings before taxes
     744               744  
Taxes on earnings
     216               216  
 
 
                        
Earnings from continuing operations
   $ 528             $ 528  
 
 
                        
Per share — basic
                        
 
                        
Earnings from continuing operations
   $ 1.40             $ 1.47  
 
 
                        
Weighted average shares outstanding — basic
     378       (18 )     360  
 
 
                        
Per share — assuming dilution
                        
 
                        
Earnings from continuing operations
   $ 1.36             $ 1.43  
 
 
                        
Weighted average shares outstanding — assuming dilution
     387       (18 )     369  
 
See Notes to Pro Forma Consolidated Financial Statements.

 

 

CAMPBELL SOUP COMPANY CONSOLIDATED
Pro Forma Consolidated Statement of Earnings
(unaudited)
(millions, except per share amounts)
                                         
    Year Ended July 29, 2007
            Less   Adjusted        
            Discontinued   Continuing   Pro Forma   Pro Forma
    As Reported   Operations (C)   Operations   Adjustments (B)   Adjusted
 
 
Net sales
   $ 7,867     $ (482 )   $ 7,385             $ 7,385  
 
 
                                        
Costs and expenses
                                        
Cost of products sold
     4,571       (187 )     4,384               4,384  
Marketing and selling expenses
     1,322       (216 )     1,106               1,106  
Administrative expenses
     604       (33 )     571               571  
Research and development expenses
     112       (1 )     111               111  
Other expenses / (income)
     (35 )     5       (30 )             (30 )
 
Total costs and expenses
     6,574       (432 )     6,142               6,142  
 
Earnings before interest and taxes
     1,293       (50 )     1,243               1,243  
Interest expense
     163       —       163               163  
Interest income
     19       —       19               19  
 
Earnings before taxes
     1,149       (50 )     1,099               1,099  
Taxes on earnings
     326       (19 )     307               307  
 
 
                                        
Earnings from continuing operations
   $ 823     $ (31 )   $ 792             $ 792  
 
 
                                        
Per share — basic
                                        
 
                                        
Earnings from continuing operations
   $ 2.13     $ (.08 )   $ 2.05             $ 2.15  
 
 
                                        
Weighted average shares outstanding — basic
     386               386       (18 )     368  
 
 
                                        
Per share — assuming dilution
                                        
 
                                        
Earnings from continuing operations
   $ 2.08     $ (.08 )   $ 2.00             $ 2.10  
 
 
                                        
Weighted average shares outstanding — assuming dilution
     396               396       (18 )     378  
 
See Notes to Pro Forma Consolidated Financial Statements.

 

 

CAMPBELL SOUP COMPANY CONSOLIDATED
Pro Forma Consolidated Statement of Earnings
(unaudited)
(millions, except per share amounts)
                         
    Year Ended July 30, 2006
            Less   Adjusted
            Discontinued   Continuing
    As Reported   Operations (C)   Operations
 
 
Net sales
   $ 7,343     $ (449 )   $ 6,894  
 
 
                        
Costs and expenses
                        
Cost of products sold
     4,273       (173 )     4,100  
Marketing and selling expenses
     1,227       (194 )     1,033  
Administrative expenses
     583       (31 )     552  
Research and development expenses
     104       (1 )     103  
Other expenses / (income)
     5       4       9  
 
Total costs and expenses
     6,192       (395 )     5,797  
 
Earnings before interest and taxes
     1,151       (54 )     1,097  
Interest expense
     165       —       165  
Interest income
     15       —       15  
 
Earnings before taxes
     1,001       (54 )     947  
Taxes on earnings
     246       (19 )     227  
 
 
                        
Earnings from continuing operations
   $ 755     $ (35 )   $ 720  
 
 
                        
Per share — basic
                        
 
                        
Earnings from continuing operations
   $ 1.86     $ (.09 )   $ 1.77  
 
 
                        
Weighted average shares outstanding — basic
     407               407  
 
 
                        
Per share — assuming dilution
                        
 
                        
Earnings from continuing operations
   $ 1.82     $ (.08 )   $ 1.74  
 
 
                        
Weighted average shares outstanding — assuming dilution
     414               414  
 
See Notes to Pro Forma Consolidated Financial Statements.

 

 

CAMPBELL SOUP COMPANY CONSOLIDATED
Pro Forma Consolidated Statement of Earnings
(unaudited)
(millions, except per share amounts)
                         
    Year Ended July 31, 2005
            Less   Adjusted
            Discontinued   Continuing
    As Reported   Operations (C)   Operations
 
 
Net sales  
   $ 7,072     $ (420 )   $ 6,652  
 
 
                        
Costs and expenses
                        
Cost of products sold
     4,179       (156 )     4,023  
Marketing and selling expenses
     1,153       (189 )     964  
Administrative expenses
     520       (27 )     493  
Research and development expenses
     93       (1 )     92  
Other expenses / (income)  
     (5 )     3       (2 )
 
Total costs and expenses  
     5,940       (370 )     5,570  
 
Earnings before interest and taxes
     1,132       (50 )     1,082  
Interest expense
     184       —       184  
Interest income  
     4       —       4  
 
Earnings before taxes
     952       (50 )     902  
Taxes on earnings  
     308       (20 )     288  
 
 
                        
Earnings from continuing operations  
   $ 644     $ (30 )   $ 614  
 
 
                        
Per share — basic
                        
 
                        
Earnings from continuing operations  
   $ 1.57     $ (.07 )   $ 1.50  
 
 
                        
Weighted average shares outstanding — basic  
     409               409  
 
 
                        
Per share — assuming dilution
                        
 
                        
Earnings from continuing operations  
   $ 1.56     $ (.07 )   $ 1.49  
 
 
                        
Weighted average shares outstanding — assuming dilution  
     413               413  
 
See Notes to Pro Forma Consolidated Financial Statements.

 

 

CAMPBELL SOUP COMPANY CONSOLIDATED
Pro Forma Consolidated Balance Sheet
January 27, 2008
(unaudited)
(millions, except per share amounts)
                                 
            Pro Forma           Pro Forma
    As Reported   Adjustments           Adjusted
     
 
 
Current assets
                                
Cash and cash equivalents
   $ 95     $ 232       (D )   $ 327  
Accounts receivable
     813       —               813  
Inventories
     735       —               735  
Other current assets
     112       —               112  
Current assets of discontinued operations held for sale
     123       (123 )     (E )     —  
 
Total current assets
     1,878       109               1,987  
 
Plant assets, net of depreciation
     1,930       —               1,930  
Goodwill
     1,933       —               1,933  
Other intangible assets, net of amortization
     633       —               633  
Other assets
     384       —               384  
Non-current assets of discontinued operations held for sale
     118       (118 )     (E )     —  
 
Total assets
   $ 6,876     $ (9 )           $ 6,867  
 
 
                                
Current liabilities
                                
Notes payable
   $ 976     $ —             $ 976  
Payable to suppliers and others
     619       —               619  
Accrued liabilities
     606       —               606  
Dividend payable
     84       —               84  
Accrued income taxes
     4       224       (F )     228  
Current liabilities of discontinued operations held for sale
     71       (71 )     (E )     —  
 
Total current liabilities
     2,360       153               2,513  
 
 
                                
Long-term debt
     1,780       —               1,780  
Other liabilities, including deferred income taxes of $380
     1,129       —               1,129  
Non-current liabilities of discontinued operations held for sale
     12       (12 )     (E )     —  
 
Total liabilities
     5,281       141               5,422  
 
Shareowners’ equity
                                
Preferred stock; authorized 40 shares; none issued
     —       —               —  
Capital stock, $.0375 par value; authorized 560 shares; issued 542 shares
     20       —               20  
Additional paid-in capital
     337       —               337  
Earnings retained in the business
     7,451       462       (G )     7,913  
Capital stock in treasury, at cost
     (6,172 )     (600 )     (D )     (6,772 )
Accumulated other comprehensive loss
     (41 )     (12 )     (E )     (53 )
 
Total shareowners’ equity
     1,595       (150 )             1,445  
 
Total liabilities and shareowners’ equity
   $ 6,876     $ (9 )           $ 6,867  
 
See Notes to Pro Forma Consolidated Financial Statements.

 

 

Campbell Soup Company
Notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements
The unaudited pro forma condensed consolidated financial statements give effect to the sale of the Godiva Chocolatier business to be accounted for as a discontinued operation. The unaudited pro forma condensed consolidated statements of earnings are presented as if the sale occurred as of August 2, 2004. The anticipated nonrecurring after-tax gain on the sale is not reflected in the pro forma condensed consolidated statements of earnings. The impact of the anticipated use of net proceeds to repurchase shares is included in the unaudited pro forma condensed consolidated statements of earnings for the six months ended January 27, 2008 and the year ended July 29, 2007. The unaudited pro forma condensed balance sheet is presented as if the sale occurred on January 27, 2008 and is based on the historical balance sheet as of that date. The nonrecurring after-tax gain is reflected in the pro forma balance sheet.
  A.   In the second quarter report filed on Form 10-Q, the results of the Godiva Chocolatier business were reported as discontinued operations and therefore were excluded from continuing operations.
 
  B.   The company expects to use approximately $600 million of the net proceeds from the sale to repurchase shares. The Pro Forma adjustments represent the impact of utilizing $600 million of net proceeds to repurchase shares at $32.58 per share, the closing stock price as of March 12, 2008. Therefore, 18 million shares are assumed to be repurchased and eliminated from shares outstanding in the earnings per share calculation for the six months ended January 27, 2008 and the year ended July 29, 2007. The actual number of shares repurchased and actual price paid could differ from these amounts.
 
  C.   The Discontinued Operations columns in the unaudited pro forma information represent the historical financial results of the company’s Godiva Chocolatier business.
 
  D.   The Pro Forma adjustments represent anticipated proceeds from the sale of $850 million, less $18 million of transaction costs and expenses associated with selling the business, less the $600 million of net proceeds expected to be used to repurchase shares reflected as an adjustment to treasury stock. The remaining net proceeds will be used to pay income taxes associated with the sale (approximately $224 million) and for general corporate purposes.
 
  E.   The Pro Forma adjustments represent the elimination of the assets and liabilities of the discontinued operations classified as assets and liabilities held for sale.
 
  F.   The Pro Forma adjustment represents the taxes payable of $224 million associated with the gain on the sale.
 
  G.   The estimated after-tax gain of approximately $462 million is reflected as an adjustment to retained earnings. The after-tax gain includes the tax impact described in note (F). This estimate is based on the historical information as of January 27, 2008. Actual adjustments may differ from the information presented.