SEGMENT REPORTING

3 Months Ended

Jan. 29, 2012

SEGMENT REPORTING

SEGMENT REPORTING

NOTE L                  SEGMENT REPORTING

The Company develops, processes, and distributes a wide array of food products in a variety of markets.  The Company reports its results in the following five segments: Grocery Products, Refrigerated Foods, Jennie-O Turkey Store, Specialty Foods, and All Other.

The Grocery Products segment consists primarily of the processing, marketing, and sale of shelf-stable food products sold predominantly in the retail market.  This segment also includes the results from the Company’s MegaMex joint venture.

The Refrigerated Foods segment includes the Hormel Refrigerated operating segment and the Affiliated Business Units.  This segment consists primarily of the processing, marketing, and sale of branded and unbranded pork and beef products for retail, foodservice, and fresh product customers.  The Affiliated Business Units include the Farmer John, Burke Corporation, Dan’s Prize, Saag’s Products, Inc., and Precept Foods businesses.  Precept Foods, LLC, is a 50.01 percent owned joint venture.

The Jennie-O Turkey Store segment consists primarily of the processing, marketing, and sale of branded and unbranded turkey products for retail, foodservice, and fresh product customers.

The Specialty Foods segment includes the Diamond Crystal Brands, Century Foods International, and Hormel Specialty Products operating segments.  This segment consists of the packaging and sale of various sugar and sugar substitute products, salt and pepper products, liquid portion products, dessert mixes, ready-to-drink products, sports nutrition products, gelatin products, and private label canned meats to retail and foodservice customers.  This segment also includes the processing, marketing, and sale of nutritional food products and supplements to hospitals, nursing homes, and other marketers of nutritional products.

The All Other segment includes the Hormel Foods International operating segment, which manufactures, markets, and sells Company products internationally.  This segment also includes the results from the Company’s international joint ventures and miscellaneous corporate sales.

Intersegment sales are recorded at prices that approximate cost and are eliminated in the Consolidated Statements of Operations.  The Company does not allocate investment income, interest expense, and interest income to its segments when measuring performance.  The Company also retains various other income and unallocated expenses at corporate.  Equity in earnings of affiliates is included in segment operating profit; however, earnings attributable to the Company’s noncontrolling interests are excluded.  These items are included below as net interest and investment expense (income), general corporate expense, and noncontrolling interest when reconciling to earnings before income taxes.

Sales and operating profits for each of the Company’s reportable segments and reconciliation to earnings before income taxes are set forth below. The Company is an integrated enterprise, characterized by substantial intersegment cooperation, cost allocations, and sharing of assets. Therefore, the Company does not represent that these segments, if operated independently, would report the operating profit and other financial information shown below.

	Three Months Ended
(in thousands)	January 29, 2012			January 30, 2011
Sales to Unaffiliated Customers
Grocery Products	$	269,479		$	276,899
Refrigerated Foods	1,083,525			1,010,702
Jennie-O Turkey Store	377,371			364,517
Specialty Foods	218,024			191,345
All Other	91,040			78,095
Total	$	2,039,439		$	1,921,558
Intersegment Sales
Grocery Products	$	—		$	—
Refrigerated Foods	2,413			2,254
Jennie-O Turkey Store	30,135			27,258
Specialty Foods	41			42
All Other	—			—
Total	$	32,589		$	29,554
Intersegment elimination	(32,589		)	(29,554		)
Total	$	—		$	—
Net Sales
Grocery Products	$	269,479		$	276,899
Refrigerated Foods	1,085,938			1,012,956
Jennie-O Turkey Store	407,506			391,775
Specialty Foods	218,065			191,387
All Other	91,040			78,095
Intersegment elimination	(32,589		)	(29,554		)
Total	$	2,039,439		$	1,921,558
Segment Operating Profit
Grocery Products	$	44,093		$	48,562
Refrigerated Foods	53,749			96,134
Jennie-O Turkey Store	76,762			73,825
Specialty Foods	16,647			17,278
All Other	12,471			9,993
Total segment operating profit	$	203,722		$	245,792
Net interest and investment expense (income)	1,624			6,138
General corporate expense	8,727			11,252
Noncontrolling interest	938			1,209
Earnings before income taxes	$	194,309		$	229,611