Reportable Segments

3 Months Ended

Jul. 31, 2014

Segment Reporting [Abstract]

Reportable Segments

Note 6: Reportable Segments

We operate in one industry: the manufacturing and marketing of food products. We have three reportable segments: U.S. Retail Coffee, U.S. Retail Consumer Foods, and International, Foodservice, and Natural Foods. The U.S. Retail Coffee segment primarily represents the domestic sales of Folgers^®, Dunkin’ Donuts^®, Millstone^®, Café Bustelo^®, and Café Pilon^® branded coffee; the U.S. Retail Consumer Foods segment primarily includes domestic sales of Jif ^®, Smucker’s^®, Pillsbury^®, Crisco^®, Martha White^®, Hungry Jack^®, and Eagle Brand^® branded products; and the International, Foodservice, and Natural Foods segment is comprised of products distributed domestically and in foreign countries through retail channels, foodservice distributors and operators (e.g., restaurants, lodging, schools and universities, health care operators), and natural foods stores and distributors.

Segment profit represents net sales, less direct and allocable operating expenses, and is consistent with the way in which we manage our segments. However, we do not represent that the segments, if operated independently, would report operating profit equal to the segment profit set forth below, as segment profit excludes certain operating expenses such as corporate administrative expenses and, effective May 1, 2014, unallocated gains and losses on commodity and foreign currency exchange derivative activities. Commodity and foreign currency exchange derivative gains and losses are reported in unallocated derivative gains and losses outside of segment operating results until the related inventory is sold. At that time, we reclassify the hedge gains and losses from unallocated derivative gains and losses to segment profit, allowing our segments to realize the economic effect of the hedge without experiencing any mark-to-market volatility. We would expect that any gain or loss in the estimated fair value of the derivatives would generally be offset by a change in the estimated fair value of the underlying exposures. Prior year results have been modified to exclude the unrealized gains and losses on commodity and foreign currency exchange derivatives.

	Three Months Ended July 31,
	2014		2013
Net sales:
U.S. Retail Coffee	$	502.7	$	514.4
U.S. Retail Consumer Foods		522.8		536.4
International, Foodservice, and Natural Foods		298.3		300.1
Total net sales	$	1,323.8	$	1,350.9
Segment profit:
U.S. Retail Coffee	$	137.6	$	142.6
U.S. Retail Consumer Foods		113.2		95.5
International, Foodservice, and Natural Foods		35.4		43.1
Total segment profit	$	286.2	$	281.2
Interest expense – net		(17.4)		(23.8)
Cost of products sold – special project costs		(0.4)		(1.5)
Unallocated derivative (losses) gains		(21.4)		4.6
Other special project costs		(8.6)		(5.8)
Corporate administrative expenses		(64.2)		(65.2)
Other income – net		1.3		—
Income before income taxes	$	175.5	$	189.5

As of July 31, 2014, the cumulative amount of net derivative losses from economic hedges that had been recognized in unallocated derivative (losses) gains and not yet allocated to segment profit was $17.3, including net gains of $4.1 incurred prior to 2015. Included in unallocated derivative (losses) gains is $9.1 of net realized losses. For additional information, see Note 11: Derivative Financial Instruments.