Business And Geographic Segment Information

12 Months Ended

Jul. 31, 2011

Business And Geographic Segment Information

Business And Geographic Segment Information

6.  Business and Geographic Segment Information

Commencing with the fourth quarter of fiscal 2011, the company reports the results of operations in the following reportable segments: U.S. Simple Meals; U.S. Beverages; Global Baking and Snacking; International Simple Meals and Beverages; and North America Foodservice. Segment results of prior periods were modified to conform to the current presentation. The company has ten operating segments based on product type and geographic location and has aggregated the operating segments into the appropriate reportable segment based on similar economic characteristics; products; production processes; types or classes of customers; distribution methods; and regulatory environment. The segments are discussed in greater detail below.

The U.S. Simple Meals segment aggregates the following operating segments: U.S. Soup and U.S. Sauces. The U.S. Soup retail business includes the following products: Campbell's condensed and ready-to-serve soups; and Swanson broth and stocks.  The U.S. Sauces retail business includes the following products: Prego pasta sauce; Pace Mexican sauce; Swanson canned poultry; and Campbell's canned gravies, pasta and beans.

The U.S. Beverages segment represents the U.S. retail beverages business, including the following products: V8 juices and beverages; and Campbell's tomato juice.

The Global Baking and Snacking segment aggregates the following operating segments: Pepperidge Farm cookies, crackers, bakery and frozen products in U.S. retail; and Arnott's biscuits in Australia and Asia Pacific.

The International Simple Meals and Beverages segment aggregates the simple meals and beverages operating segments outside of the United States, including Europe, Latin America, the Asia Pacific region and the retail business in Canada. See Note 3 for information on the sale of the sauce and mayonnaise business comprised of products sold under the Lesieur brand in France. This business was historically included in this segment.

The North America Foodservice segment represents the distribution of products such as soup, specialty entrees, beverage products, other prepared foods and Pepperidge Farm products through various food service channels in the United States and Canada.

The company's accounting policies for measuring segment assets and earnings before interest and taxes are substantially consistent with those described in Note 1. The company evaluates segment performance before interest, taxes, and beginning in fiscal 2011, costs associated with restructuring activities. Segment operating earnings of prior periods were modified to conform to the current presentation. The manufacturing, warehousing, distribution and selling activities of the company's U.S. retail business are operated as an integrated platform in order to maximize efficiency and productivity. As a result, assets and capital expenditures of the U.S. Simple Meals and U.S. Beverages are not discretely maintained. Depreciation expense associated with the integrated operations, however, is allocated to the U.S. Simple Meals and U.S. Beverages segments based on production hours. North America Foodservice products are principally produced by the tangible assets of the company's other segments, except for refrigerated soups, which are produced in a separate facility, and certain other products, which are produced under contract manufacturing agreements. Tangible assets of the company's other segments are not allocated to the North America Foodservice operations. Depreciation, however, is allocated to North America Foodservice based on production hours.

The company's largest customer, Wal-Mart Stores, Inc. and its affiliates, accounted for approximately 17% of consolidated net sales in 2011 and 18% in 2010 and 2009. All of the company's segments sold products to Wal-Mart Stores, Inc. or its affiliates.

Business Segments

	2011	2010	2009
Net sales
U.S. Simple Meals	$  2,751	$  2,938	$  3,049
U.S. Beverages	759	762	735
Global Baking and Snacking	2,156	1,975	1,846
International Simple Meals and Beverages	1,463	1,423	1,357
North America Foodservice	590	578	599
Total	$  7,719	$  7,676	$  7,586

	2011	2010	2009(3)
Earnings before interest and taxes
U.S. Simple Meals	$   657	$   737	$      749
U.S. Beverages	182	206	178
Global Baking and Snacking	355	322	265
International Simple Meals and Beverages	185	161	69
North America Foodservice	82	55	53
Corporate(1)	(119)	(121)	(107)
Restructuring charges and related costs(2)	(63)	(12)	(22)
Total	$ 1,279	$ 1,348	$   1,185
	2011	2010	2009
Depreciation and Amortization
U.S. Simple Meals	$     87	$     86	$        86
U.S. Beverages	20	21	15
Global Baking and Snacking	82	75	71
International Simple Meals and Beverages	42	35	41
North America Foodservice	13	13	28
Corporate(1)	24	21	23
Total	$   268	$   251	$      264
	2011	2010	2009
Capital Expenditures
U.S. Simple Meals and U.S. Beverages	$   126	$   139	$      177
Global Baking and Snacking	73	81	58
International Simple Meals and Beverages	36	26	34
North America Foodservice	3	3	17
Corporate(1)	34	66	59
Total	$   272	$   315	$      345
	2011	2010	2009
Segment Assets
U.S. Simple Meals and U.S. Beverages	$ 2,129	$ 2,146	$   2,168
Global Baking and Snacking	1,982	1,710	1,628
International Simple Meals and Beverages	1,539	1,396	1,474
North America Foodservice	350	360	377
Corporate(1)	862	664	409
Total	$6,862	$ 6,276	$   6,056

____________

(1)	Represents unallocated corporate expenses and unallocated assets.
(2)	See Note 7 for additional information.
(3)	Earnings before interest and taxes of the International Simple Meals and Beverages segment included a $67 impairment charge on certain European trademarks. See Note 5 for additional information.

The company's global net sales based on product categories are as follows:

	2011	2010	2009
Net sales
Simple Meals	$      4,437	$      4,594	$      4,674
Baked Snacks	2,321	2,129	1,995
Beverages	961	953	917
Total	$      7,719	$      7,676	$      7,586

Simple meals include condensed and ready-to-serve soups, broths and sauces. Baked snacks include cookies, crackers, biscuits and other baked products.

Geographic Area Information

Information about operations in different geographic areas is as follows:

	2011	2010	2009
Net sales
United States	$   5,309	$   5,436	$   5,548
Europe	596	601	608
Australia/Asia Pacific	1,138	978	816
Other countries	676	661	614
Total	$   7,719	$   7,676	$   7,586

	2011	2010	2009
Long-lived assets
United States	$   1,281	$   1,279	$   1,388
Europe	102	104	119
Australia/Asia Pacific	384	326	283
Other countries	109	105	108
Corporate(1)	227	237	79
Total	$   2,103	$   2,051	$   1,977

____________

(1) Represents primarily corporate offices.