Business and Geographic Segment Information

Commencing in the third quarter of 2018 with the acquisition of Snyder's-Lance, we formed a new U.S. snacking unit, which combines Snyder's-Lance and Pepperidge Farm, and is an operating segment. As of the third quarter of 2018, we have four operating segments based primarily on product type, and three reportable segments. The U.S. snacking operating segment is aggregated with the international biscuits and snacks operating segment to form the Global Biscuits and Snacks reportable segment. The operating segments are aggregated based on similar economic characteristics, products, production processes, types or classes of customers, distribution methods, and regulatory environment. Our reportable segments are as follows:

•

Americas Simple Meals and Beverages segment includes the retail and food service businesses in the U.S. and Canada. The segment includes the following products: Campbell’s condensed and ready-to-serve soups; Swanson broth and stocks; Prego pasta sauces; Pace Mexican sauces; Campbell’s gravies, pasta, beans and dinner sauces; Swanson canned poultry; Plum food and snacks; V8 juices and beverages; Campbell’s tomato juice; and as of December 12, 2017, Pacific broth, soups, non-dairy beverages and other simple meals;

•

Global Biscuits and Snacks segment represents an aggregation of the following operating segments: U.S. snacks operating segment, which includes Pepperidge Farm cookies, crackers, bakery and frozen products in U.S. retail, and Snyder’s-Lance pretzels, sandwich crackers, potato chips, tortilla chips and other snacking products in the U.S. and Europe; and the international biscuits and snacks operating segment, which includes Arnott’s biscuits in Australia and Asia Pacific, Kelsen cookies globally, the simple meals and shelf-stable beverages business in Australia and Asia Pacific, and beginning in 2018, the business in Latin America; and


•	Campbell Fresh segment includes Bolthouse Farms fresh carrots, carrot ingredients, refrigerated beverages and refrigerated salad dressings; Garden Fresh Gourmet salsa, hummus, dips and tortilla chips; and the U.S. refrigerated soup business.

Prior to 2018, the business in Latin America was managed as part of the Americas Simple Meals and Beverages segment. Segment results have been adjusted retrospectively to reflect this change.

On August 30, 2018, we announced plans to pursue the divestiture of our international biscuits and snacks operating segment, and the Campbell Fresh segment. The international biscuits and snacks operating segment and the Campbell Fresh segment combined represent approximately $2,100 in net sales in 2018.

We evaluate segment performance before interest, taxes and costs associated with restructuring activities and impairment charges. Unrealized gains and losses on commodity hedging activities are excluded from segment operating earnings and are recorded in Corporate as these open positions represent hedges of future purchases. Upon closing of the contracts, the realized gain or loss is transferred to segment operating earnings, which allows the segments to reflect the economic effects of the hedge without exposure to quarterly volatility of unrealized gains and losses. Only the service cost component of pension and postretirement expense is allocated to segments. All other components of expense, including interest cost, expected return on assets, amortization of prior service credits and recognized actuarial gains and losses are reflected in Corporate and not included in segment operating results. Asset information by segment is not discretely maintained for internal reporting or used in evaluating performance. Therefore, only geographic segment asset information is provided.

Our largest customer, Wal-Mart Stores, Inc. and its affiliates, accounted for approximately 18% of consolidated net sales in 2018, and 20% of consolidated net sales in 2017 and 2016. All of our reportable segments sold products to Wal-Mart Stores, Inc. or its affiliates.



	2018		2017		2016
Net sales
Americas Simple Meals and Beverages	$	4,213	$	4,256	$	4,313
Global Biscuits and Snacks	3,499		2,667		2,631
Campbell Fresh	970		967		1,017
Corporate	3		—		—
Total	$	8,685	$	7,890	$	7,961



	2018			2017			2016
Earnings before interest and taxes
Americas Simple Meals and Beverages	$	982		$	1,111		$	1,060
Global Biscuits and Snacks	540			463			431
Campbell Fresh	(43		)	(9		)	60
Corporate⁽¹⁾	(948		)	(147		)	(560		)
Restructuring charges⁽²⁾	(62		)	(18		)	(31		)
Total	$	469		$	1,400		$	960



	2018		2017		2016
Depreciation and amortization
Americas Simple Meals and Beverages	$	158	$	118	$	117
Global Biscuits and Snacks	144		98		96
Campbell Fresh	73		83		77
Corporate⁽³⁾	19		19		18
Total	$	394	$	318	$	308



	2018		2017		2016
Capital expenditures
Americas Simple Meals and Beverages	$	187	$	117	$	105
Global Biscuits and Snacks	133		127		122
Campbell Fresh	46		47		74
Corporate⁽³⁾	41		47		40
Total	$	407	$	338	$	341

_______________________________________

⁽¹⁾

Represents unallocated items. Pension and postretirement benefit mark-to-market adjustments and curtailments are included in Corporate. There were gains of $136 and $178 in 2018 and 2017, respectively, and losses of $313 in 2016. Costs related to the cost savings initiatives were $136, $40 and $47 in 2018, 2017 and 2016, respectively. Transaction and integration costs associated with the acquisition of Snyder's-Lance were $107 in 2018. Intangible asset impairment charges were $737, $212 and $141 in 2018, 2017 and 2016, respectively. See Note 5 for information on the intangible asset impairment charges. Plant asset impairment charges were $11 in 2018. A charge of $22 related to the settlement of a legal claim was included in 2018, and a gain of $25 from a settlement of a claim related to the Kelsen acquisition was included in 2016.


⁽²⁾	See Note 7 for additional information.


⁽³⁾	Represents primarily corporate offices.

Our global net sales based on product categories are as follows:



	2018		2017		2016
Net sales
Soup	$	2,615	$	2,673	$	2,690
Snacks	3,344		2,511		2,479
Other simple meals	1,699		1,698		1,702
Beverages	1,024		1,008		1,090
Other	3		—		—
Total	$	8,685	$	7,890	$	7,961

Soup includes various soup, broths and stock products. Snacks include cookies, pretzels, crackers, biscuits, popcorn, nuts, potato chips, tortilla chips and other salty snacks and baked products. Other simple meals include sauces, carrot products, refrigerated salad dressings, refrigerated salsa, hummus, dips and Plum foods and snacks.

Geographic Area Information

Information about operations in different geographic areas is as follows:



	2018		2017		2016
Net sales
United States	$	7,032	$	6,357	$	6,437
Australia	622		610		590
Other countries	1,031		923		934
Total	$	8,685	$	7,890	$	7,961



	2018		2017		2016
Long-lived assets
United States	$	2,778	$	1,987	$	1,967
Australia	248		265		242
Other countries	207		202		198
Total	$	3,233	$	2,454	$	2,407