Segment Information

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company operates in two product segments: Oral, Personal and Home Care; and Pet Nutrition. The operations of the Oral, Personal and Home Care product segment are managed geographically in five reportable operating segments: North America, Latin America, Europe/South Pacific, Asia and Africa/Eurasia.

The Company evaluates segment performance based on several factors, including Operating profit. The Company uses Operating profit as a measure of the operating segment performance because it excludes the impact of corporate-driven decisions related to interest expense and income taxes.

The accounting policies of the operating segments are generally the same as those described in Note 2, Summary of Significant Accounting Policies. Intercompany sales have been eliminated. Corporate operations include costs related to stock options and restricted stock unit awards, research and development costs, Corporate overhead costs, restructuring and related implementation costs, and gains and losses on sales of non-core product lines and assets. The Company reports these items within Corporate operations as they relate to Corporate-based responsibilities and decisions and are not included in the internal measures of segment operating performance used by the Company to measure the underlying performance of the operating segments. 

Approximately 80% of the Company’s Net sales are generated from markets outside the U.S., with over 50% of the Company’s Net sales coming from emerging markets (which consist of Latin America, Asia (excluding Japan), Africa/Eurasia and Central Europe).

In 2014, Corporate Operating profit (loss) includes charges of $286 related to the 2012 Restructuring Program, charges of $327 related to the 2014 Venezuela Remeasurements, charges of $41 for European competition law matters and costs of $4 related to the sale of land in Mexico. In 2013, Corporate Operating profit (loss) included charges of $371 related to the 2012 Restructuring Program, a charge of $172 related to the 2013 Venezuela Remeasurement, a charge of $23 for a European competition law matter and costs of $18 related to the sale of land in Mexico. In 2012, Corporate Operating profit (loss) included charges of $89 related to the 2012 Restructuring Program, costs of $24 related to the sale of land in Mexico and costs of $21 associated with various business realignment and other cost-saving initiatives. The various business realignment and other cost-saving initiatives included the integration of Sanex, the right-sizing of the Colombia business and the closing of an oral care facility in Mississauga, Canada and a Hill’s facility in Los Angeles, California. For further information regarding the 2012 Restructuring Program, refer to Note 4, Restructuring and Related Implementation Charges. For further information regarding Venezuela, refer to Note 14, Venezuela. For further information regarding the European competition law matters, refer to Note 13, Commitments and Contingencies. For further information regarding the sale of land in Mexico, refer to Note 3, Acquisitions and Divestitures.

	2014		2013		2012
Net sales
Oral, Personal and Home Care
North America(1)	$	3,124	$	3,072	$	2,971
Latin America	4,769		5,012		5,032
Europe/South Pacific	3,406		3,396		3,417
Asia	2,515		2,472		2,264
Africa/Eurasia	1,208		1,257		1,241
Total Oral, Personal and Home Care	15,022		15,209		14,925
Pet Nutrition(2)	2,255		2,211		2,160
Total Net sales	$	17,277	$	17,420	$	17,085

_________

⁽¹⁾  Net sales in the U.S. for Oral, Personal and Home Care were $2,835, $2,771 and $2,669 in 2014, 2013 and 2012, respectively.

⁽²⁾  Net sales in the U.S. for Pet Nutrition were $1,149, $1,116 and $1,052 in 2014, 2013 and 2012, respectively.

	2014			2013			2012
Operating profit
Oral, Personal and Home Care
North America	$	926		$	927		$	810
Latin America	1,279			1,385			1,454
Europe/South Pacific	877			805			747
Asia	736			698			619
Africa/Eurasia	235			268			267
Total Oral, Personal and Home Care	4,053			4,083			3,897
Pet Nutrition	592			563			589
Corporate	(1,088		)	(1,090		)	(597		)
Total Operating profit	$	3,557		$	3,556		$	3,889

	2014		2013		2012
Capital expenditures
Oral, Personal and Home Care
North America	$	136	$	54	$	43
Latin America	205		235		237
Europe/South Pacific	78		74		71
Asia	147		123		88
Africa/Eurasia	14		11		16
Total Oral, Personal and Home Care	580		497		455
Pet Nutrition	40		45		37
Corporate	137		128		73
Total Capital expenditures	$	757	$	670	$	565

	2014		2013		2012
Depreciation and amortization
Oral, Personal and Home Care
North America	$	43	$	51	$	50
Latin America	93		93		91
Europe/South Pacific	84		85		85
Asia	78		72		70
Africa/Eurasia	10		11		11
Total Oral, Personal and Home Care	308		312		307
Pet Nutrition	52		51		50
Corporate	82		76		68
Total Depreciation and amortization	$	442	$	439	$	425

	2014		2013		2012
Identifiable assets
Oral, Personal and Home Care
North America	$	2,326	$	2,301	$	2,157
Latin America	3,693		4,202		4,288
Europe/South Pacific	3,836		3,978		3,649
Asia	1,903		1,794		1,608
Africa/Eurasia	510		557		561
Total Oral, Personal and Home Care	12,268		12,832		12,263
Pet Nutrition	1,051		1,087		1,045
Corporate(3)	140		66		86
Total Identifiable assets(4)	$	13,459	$	13,985	$	13,394

____________

⁽³⁾  In 2014, Corporate identifiable assets primarily consist of derivative instruments (62%) and investments in equity securities (22%).  In 2013, Corporate identifiable assets primarily consist of derivative instruments (32%) and investments in equity securities (41%).  In 2012, Corporate identifiable assets primarily consist of derivative instruments (67%) and investments in equity securities (28%).  

⁽⁴⁾  Long-lived assets in the U.S., primarily property, plant and equipment and goodwill and other intangibles represented approximately one-third of total long-lived assets of $8,086, $8,248 and $8,066 in 2014, 2013 and 2012, respectively.