Note 15: Guarantor and Non-Guarantor Financial Information

Our 3.50 percent Senior Notes due October 15, 2021, are fully and unconditionally guaranteed, on a joint and several basis, by J.M. Smucker LLC and The Folgers Coffee Company (the “subsidiary guarantors”), which are 100 percent wholly-owned subsidiaries of the Company. A subsidiary guarantor will be released from its obligations under the indenture governing the notes (a) if we exercise our legal or covenant defeasance option or if our obligations under the indenture are discharged in accordance with the terms of the indenture or (b) upon delivery of an officer’s certificate to the trustee that the subsidiary guarantor does not guarantee our obligations under any of our other primary senior indebtedness and that any other guarantees of such primary senior indebtedness of the subsidiary guarantor have been released other than through discharges as a result of payment by such guarantor on such guarantees.

Condensed consolidating financial statements for the Company, the subsidiary guarantors, and the other subsidiaries of the Company that are not guaranteeing the indebtedness under the 3.50 percent Senior Notes (the “non-guarantor subsidiaries”) are provided below. The principal elimination entries relate to investments in subsidiaries and intercompany balances and transactions, including transactions with our 100 percent wholly-owned subsidiary guarantors and non-guarantor subsidiaries. We have accounted for investments in subsidiaries using the equity method.

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME


	Three Months Ended July 31, 2014
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Net sales	$	707.1	$	290.4	$	1,517.8	$	(1,191.5)	$	1,323.8
Cost of products sold		582.8		263.2		1,181.2		(1,182.1)		845.1
Gross Profit		124.3		27.2		336.6		(9.4)		478.7
Selling, distribution, and administrative expenses and other special project costs		52.8		12.2		197.0		—		262.0
Amortization		1.0		—		23.9		—		24.9
Other operating expense (income) – net		—		0.4		(0.2)		—		0.2
Operating Income		70.5		14.6		115.9		(9.4)		191.6
Interest (expense) income – net		(17.6)		0.3		(0.1)		—		(17.4)
Other income – net		1.3		—		—		—		1.3
Equity in net earnings of subsidiaries		77.5		38.8		14.6		(130.9)		—
Income Before Income Taxes		131.7		53.7		130.4		(140.3)		175.5
Income taxes		15.7		0.1		43.7		—		59.5
Net Income	$	116.0	$	53.6	$	86.7	$	(140.3)	$	116.0
Other comprehensive (loss) income, net of tax		(5.3)		(4.0)		(7.0)		11.0		(5.3)
Comprehensive Income	$	110.7	$	49.6	$	79.7	$	(129.3)	$	110.7

CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME


	Three Months Ended July 31, 2013
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Net sales	$	736.0	$	303.4	$	1,593.4	$	(1,281.9)	$	1,350.9
Cost of products sold		600.4		277.4		1,257.9		(1,277.7)		858.0
Gross Profit		135.6		26.0		335.5		(4.2)		492.9
Selling, distribution, and administrative expenses, and other special project costs		48.6		10.9		196.5		—		256.0
Amortization		1.1		—		23.4		—		24.5
Other operating (income) expense – net		(1.5)		(0.2)		0.8		—		(0.9)
Operating Income		87.4		15.3		114.8		(4.2)		213.3
Interest (expense) income – net		(24.0)		0.3		(0.1)		—		(23.8)
Other income (expense) – net		—		0.1		(0.1)		—		—
Equity in net earnings of subsidiaries		82.6		32.9		15.4		(130.9)		—
Income Before Income Taxes		146.0		48.6		130.0		(135.1)		189.5
Income taxes		19.4		0.1		43.4		—		62.9
Net Income	$	126.6	$	48.5	$	86.6	$	(135.1)	$	126.6
Other comprehensive (loss) income, net of tax		(2.7)		1.9		(3.9)		2.0		(2.7)
Comprehensive Income	$	123.9	$	50.4	$	82.7	$	(133.1)	$	123.9

CONDENSED CONSOLIDATING BALANCE SHEETS


	July 31, 2014
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
ASSETS
Current Assets
Cash and cash equivalents	$	18.7	$	—	$	130.7	$	—	$	149.4
Inventories		—		188.3		905.5		(9.3)		1,084.5
Other current assets		428.9		6.0		71.4		(12.0)		494.3
Total Current Assets		447.6		194.3		1,107.6		(21.3)		1,728.2
Property, Plant, and Equipment – Net		238.4		552.5		483.8		—		1,274.7
Investments in Subsidiaries		8,448.6		4,098.0		252.5		(12,799.1)		—
Intercompany Receivable		—		303.7		1,103.0		(1,406.7)		—
Other Noncurrent Assets
Goodwill		1,082.0		—		2,016.6		—		3,098.6
Other intangible assets – net		504.4		—		2,495.3		—		2,999.7
Other noncurrent assets		75.3		10.7		63.0		—		149.0
Total Other Noncurrent Assets		1,661.7		10.7		4,574.9		—		6,247.3
Total Assets	$	10,796.3	$	5,159.2	$	7,521.8	$	(14,227.1)	$	9,250.2

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities	$	747.4	$	89.3	$	194.6	$	(12.0)	$	1,019.3
Noncurrent Liabilities
Long-term debt		1,881.1		—		—		—		1,881.1
Deferred income taxes		109.2		—		910.7		—		1,019.9
Intercompany payable		2,757.4		—		—		(2,757.4)		—
Other noncurrent liabilities		216.8		12.7		16.0		—		245.5
Total Noncurrent Liabilities		4,964.5		12.7		926.7		(2,757.4)		3,146.5
Total Liabilities		5,711.9		102.0		1,121.3		(2,769.4)		4,165.8
Total Shareholders’ Equity		5,084.4		5,057.2		6,400.5		(11,457.7)		5,084.4
Total Liabilities and Shareholders’ Equity	$	10,796.3	$	5,159.2	$	7,521.8	$	(14,227.1)	$	9,250.2

CONDENSED CONSOLIDATING BALANCE SHEETS


	April 30, 2014
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
ASSETS
Current Assets
Cash and cash equivalents	$	6.8	$	—	$	146.7	$	—	$	153.5
Inventories		—		173.3		761.4		(3.7)		931.0
Other current assets		360.2		9.9		94.6		(10.1)		454.6
Total Current Assets		367.0		183.2		1,002.7		(13.8)		1,539.1
Property, Plant, and Equipment – Net		233.6		551.1		480.9		—		1,265.6
Investments in Subsidiaries		8,367.6		4,063.3		237.9		(12,668.8)		—
Intercompany Receivable		—		315.5		1,132.2		(1,447.7)		—
Other Noncurrent Assets
Goodwill		1,082.0		—		2,016.2		—		3,098.2
Other intangible assets – net		505.5		—		2,518.8		—		3,024.3
Other noncurrent assets		70.4		11.1		63.4		—		144.9
Total Other Noncurrent Assets		1,657.9		11.1		4,598.4		—		6,267.4
Total Assets	$	10,626.1	$	5,124.2	$	7,452.1	$	(14,130.3)	$	9,072.1

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities	$	595.9	$	103.8	$	201.4	$	(10.1)	$	891.0
Noncurrent Liabilities
Long-term debt		1,879.8		—		—		—		1,879.8
Deferred income taxes		107.6		—		913.1		—		1,020.7
Intercompany payable		2,792.9		—		—		(2,792.9)		—
Other noncurrent liabilities		220.3		12.8		17.9		—		251.0
Total Noncurrent Liabilities		5,000.6		12.8		931.0		(2,792.9)		3,151.5
Total Liabilities		5,596.5		116.6		1,132.4		(2,803.0)		4,042.5
Total Shareholders’ Equity		5,029.6		5,007.6		6,319.7		(11,327.3)		5,029.6
Total Liabilities and Shareholders’ Equity	$	10,626.1	$	5,124.2	$	7,452.1	$	(14,130.3)	$	9,072.1

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS


	Three Months Ended July 31, 2014
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Net Cash Provided by (Used for) Operating Activities	$	—	$	7.9	$	(16.0)	$	—	$	(8.1)
Investing Activities
Additions to property, plant, and equipment		(12.3)		(16.1)		(20.6)		—		(49.0)
Proceeds from disposal of property, plant, and equipment		—		1.1		0.1		—		1.2
Repayments from (disbursements of) intercompany loans		—		11.8		23.8		(35.6)		—
Other – net		(0.1)		(4.7)		0.5		—		(4.3)
Net Cash (Used for) Provided by Investing Activities		(12.4)		(7.9)		3.8		(35.6)		(52.1)
Financing Activities
Revolving credit facility – net		221.6		—		—		—		221.6
Repayments of long-term debt		(100.0)		—		—		—		(100.0)
Quarterly dividends paid		(58.9)		—		—		—		(58.9)
Purchase of treasury shares		(10.6)		—		—		—		(10.6)
Proceeds from stock option exercises		0.4		—		—		—		0.4
Intercompany payable		(35.6)		—		—		35.6		—
Other – net		7.4		—		—		—		7.4
Net Cash Provided by Financing Activities		24.3		—		—		35.6		59.9
Effect of exchange rate changes on cash		—		—		(3.8)		—		(3.8)
Net increase (decrease) in cash and cash equivalents		11.9		—		(16.0)		—		(4.1)
Cash and cash equivalents at beginning of period		6.8		—		146.7		—		153.5
Cash and Cash Equivalents at End of Period	$	18.7	$	—	$	130.7		—	$	149.4

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS


	Three Months Ended July 31, 2013
	The J.M. Smucker Company (Parent)		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations		Consolidated
Net Cash Provided by (Used for) Operating Activities	$	40.6	$	(7.9)	$	49.4	$	—	$	82.1
Investing Activities
Additions to property, plant, and equipment		(4.0)		(19.5)		(12.8)		—		(36.3)
Proceeds from disposal of property, plant, and equipment		—		0.3		0.8		—		1.1
Repayments from (disbursements of) intercompany loans		—		27.4		(34.7)		7.3		—
Other – net		(3.1)		(0.3)		(3.7)		—		(7.1)
Net Cash (Used for) Provided by Investing Activities		(7.1)		7.9		(50.4)		7.3		(42.3)
Financing Activities
Revolving credit facility—net		85.0		—		—		—		85.0
Quarterly dividends paid		(55.4)		—		—		—		(55.4)
Purchase of treasury shares		(165.4)		—		—		—		(165.4)
Proceeds from stock option exercises		0.1		—		—		—		0.1
Intercompany payable		7.3		—		—		(7.3)		—
Other – net		7.9		—		(7.8)		—		0.1
Net Cash Used for Financing Activities		(120.5)		—		(7.8)		(7.3)		(135.6)
Effect of exchange rate changes		—		—		(3.1)		—		(3.1)
Net decrease in cash and cash equivalents		(87.0)		—		(11.9)		—		(98.9)
Cash and cash equivalents at beginning of period		108.0		—		148.4		—		256.4
Cash and Cash Equivalents at End of Period	$	21.0	$	—	$	136.5	$	—	$	157.5