Heinz H J (HNZ) 10-Q 25 Feb 10 2010 Q0 Quarterly report Financial data

Document and Company Informatio

Document and Company Information (USD $)
	9 Months Ended Jan. 27, 2010	Oct. 29, 2008
Document and Company Information [Abstract]
Entity Registrant Name	HEINZ H J CO
Entity Central Index Key	0000046640
Document Type	10-Q
Document Period End Date	2010-01-27
Amendment Flag	false
Current Fiscal Year End Date	--04-28
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float		$13,000,000,000
Entity Common Stock, Shares Outstanding	316,236,278

Consolidated Statements of Inco

Consolidated Statements of Income (Unaudited) (USD $)
In Thousands, except Per Share data	3 Months Ended Jan. 27, 2010	3 Months Ended Jan. 28, 2009	9 Months Ended Jan. 27, 2010	9 Months Ended Jan. 28, 2009
Consolidated Statements of Income [Abstract]
Sales	$2,681,702	$2,379,711	$7,770,173	$7,495,563
Cost of products sold	1,676,436	1,528,997	4,939,349	4,802,027
Gross profit	1,005,266	850,714	2,830,824	2,693,536
Selling, general and administrative expenses	568,756	467,272	1,616,837	1,530,058
Operating income	436,510	383,442	1,213,987	1,163,478
Interest income	4,166	25,713	40,341	47,984
Interest expense	71,978	95,931	226,592	254,514
Other (expense)/income, net	(2,438)	17,498	(17,478)	97,125
Income from continuing operations before income taxes	366,260	330,722	1,010,258	1,054,073
Provision for income taxes	99,523	85,659	273,301	290,883
Income from continuing operations	266,737	245,063	736,957	763,190
Loss from discontinued operations, net of tax	(35,588)	(1,287)	(49,389)	(2,671)
Net income	231,149	243,776	687,568	760,519
Less: Net income attributable to the noncontrolling interest	2,622	1,513	15,042	12,582
Net income attributable to H. J. Heinz Company	228,527	242,263	672,526	747,937
Diluted
Continuing operations attributable to H. J. Heinz Company common shareholders	0.83	0.76	2.27	2.35
Discontinued operations attributable to H. J. Heinz Company common shareholders	-0.11	$0	-0.16	-0.01
Net income attributable to H. J. Heinz Company common shareholders	0.72	0.76	2.11	2.34
Average common shares outstanding-diluted	318,036	318,733	317,627	317,995
Basic
Continuing operations attributable to H. J. Heinz Company common shareholders	0.83	0.77	2.28	2.38
Discontinued operations attributable to H. J. Heinz Company common shareholders	-0.11	$0	-0.16	-0.01
Net income attributable to H. J. Heinz Company common shareholders	0.72	0.77	2.13	2.38
Average common shares outstanding-basic	315,955	314,538	315,519	313,417
Cash dividends per share	0.42	0.415	1.26	1.245
Amounts attributable to H. J. Heinz Company common shareholders:
Income from continuing operations, net of tax	264,115	243,550	721,915	750,608
Loss from discontinued operations, net of tax	(35,588)	(1,287)	(49,389)	(2,671)
Net income	$228,527	$242,263	$672,526	$747,937

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets (USD $)
In Thousands	Jan. 27, 2010	Apr. 29, 2009
Current Assets:
Cash and cash equivalents	$562,307	$373,145	[1]
Trade receivables, net	784,865	881,164	[1]
Other receivables, net	293,768	290,633	[1]
Inventories:
Finished goods and work-in-process	1,015,976	973,983	[1]
Packaging material and ingredients	360,194	263,630	[1]
Total inventories	1,376,170	1,237,613	[1]
Prepaid expenses	131,796	125,765	[1]
Other current assets	107,668	36,701	[1]
Total current assets	3,256,574	2,945,021	[1]
Property, plant and equipment	4,420,277	4,109,562	[1]
Less accumulated depreciation	2,361,691	2,131,260	[1]
Total property, plant and equipment, net	2,058,586	1,978,302	[1]
Goodwill	2,826,752	2,687,788	[1]
Trademarks, net	918,187	889,815	[1]
Other intangibles, net	415,441	405,351	[1]
Long-term restricted cash	0	192,736	[1]
Other non-current assets	595,645	565,171	[1]
Total other non-current assets	4,756,025	4,740,861	[1]
Total assets	10,071,185	9,664,184	[1]
Current Liabilities:
Short-term debt	43,632	61,297	[2]
Portion of long-term debt due within one year	4,897	4,341	[2]
Trade payables	917,804	955,430	[2]
Other payables	134,997	157,877	[2]
Salaries and wages	89,410	91,283	[2]
Accrued marketing	318,058	233,316	[2]
Other accrued liabilities	491,007	485,406	[2]
Income taxes	88,710	73,896	[2]
Total current liabilities	2,088,515	2,062,846	[2]
Long-term debt	4,764,221	5,076,186	[2]
Deferred income taxes	533,690	345,749	[2]
Non-pension post-retirement benefits	222,919	214,786	[2]
Other liabilities	571,695	685,512	[2]
Total long-term liabilities	6,092,525	6,322,233	[2]
Equity:
Capital stock	107,844	107,844	[2]
Additional capital	665,744	737,917	[2]
Retained earnings	6,797,957	6,525,719	[2]
Total capital stock, additional capital and retained earnings	7,571,545	7,371,480	[2]
Less:
Treasury stock at cost (114,860 shares at January 27, 2010 and 116,237 shares at April 29, 2009)	4,818,295	4,881,842	[2]
Accumulated other comprehensive loss	929,597	1,269,700	[2]
Total H. J. Heinz Company shareholders' equity	1,823,653	1,219,938	[2]
Noncontrolling interest	66,492	59,167	[2]
Total equity	1,890,145	1,279,105	[2]
Total liabilities and equity	$10,071,185	$9,664,184	[2]
[1]The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America.
[2]The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. Noncontrolling (minority) interest has been reclassified and presented as a component of equity as a result of the adoption of new accounting guidance (see Note 3).

1_Condensed Consolidated Balanc

Condensed Consolidated Balance Sheets (Parenthetical) (USD $)
Share data in Thousands	Jan. 27, 2010	Apr. 29, 2009
Equity (Less):
Treasury stock, shares	114,860	116,237

Condensed Consolidated Statemen

Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $)
In Thousands	9 Months Ended Jan. 27, 2010		9 Months Ended Jan. 28, 2009
Cash Flows from Operating Activities:
Net income	$687,568		$760,519
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	183,912		182,466
Amortization	35,524		29,337
Deferred tax provision	204,246		68,215
Pension contributions	(242,404)		(54,778)
Other items, net	146,728		(14,356)
Changes in current assets and liabilities, excluding effects of acquisitions and divestitures:
Receivables securitization facility	146,800		0
Receivables	11,102		(86,889)
Inventories	(81,201)		(154,143)
Prepaid expenses and other current assets	6,240		(5,638)
Accounts payable	(112,512)		(192,327)
Accrued liabilities	61,210		(50,028)
Income taxes	(45,091)		23,539
Cash provided by operating activities	1,002,122		505,917
Cash Flows from Investing Activities:
Capital expenditures	(150,419)		(183,447)
Proceeds from disposals of property, plant and equipment	1,334		1,366
Acquisitions, net of cash acquired	(73,376)		(287,059)
Proceeds from divestitures	18,417		12,895
Change in restricted cash	192,736		(192,736)
Other items, net	(5,262)		(1,916)
Cash used for investing activities	(16,570)		(650,897)
Cash Flows from Financing Activities:
Payments on long-term debt	(622,704)		(361,193)
Proceeds from long-term debt	440,117		849,844
Net (payments on)/proceeds from commercial paper and short-term debt	(253,168)		179,200
Dividends	(399,615)		(394,317)
Purchases of treasury stock	0		(181,431)
Exercise of stock options	22,465		263,235
Other items, net	9,300		6,149
Cash (used for)/provided by financing activities	(803,605)		361,487
Effect of exchange rate changes on cash and cash equivalents	7,215		(143,253)
Net increase in cash and cash equivalents	189,162		73,254
Cash and cash equivalents at beginning of year	373,145	[1]	617,687
Cash and cash equivalents at end of period	$562,307		$690,941
[1]The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America.

Basis of Presentation

Basis of Presentation
	9 Months Ended Jan. 27, 2010 USD / shares
Basis of Presentation [Abstract]
Basis of Presentation	(1) Basis of Presentation The interim condensed consolidated financial statements of H. J. Heinz Company, together with its subsidiaries (collectively referred to as the Company), are unaudited. In the opinion of management, all adjustments, which are of a normal and recurring nature, except those which have been disclosed elsewhere in this Quarterly Report on Form10-Q, necessary for a fair statement of the results of operations of these interim periods, have been included. The results for interim periods are not necessarily indicative of the results to be expected for the full fiscal year due to the seasonal nature of the Companys business. Certain prior year amounts have been reclassified to conform with the Fiscal 2010 presentation. These statements should be read in conjunction with the Companys consolidated financial statements and related notes, and managements discussion and analysis of financial condition and results of operations which appear in the Companys Annual Report on Form10-K for the year ended April29, 2009. Subsequent events occurring after January27, 2010 were evaluated through February25, 2010, the date these financial statements were issued.

Venezuela

Venezuela
	9 Months Ended Jan. 27, 2010 USD / shares
Venezuela [Abstract]
Venezuela	(2) Venezuela Foreign Currency The local currency in Venezuela is the bolivar fuerte (VEF). A currency control board exists in Venezuela that is responsible for foreign exchange procedures, including approval of requests for exchanges of VEF for U.S.dollars at the official (government established) exchange rate. Our business in Venezuela has historically been successful in obtaining U.S.dollars at the official exchange rate for imports of ingredients, packaging, manufacturing equipment, and other necessary inputs, and for dividend remittances, albeit on a delay. While an unregulated parallel market exists for exchanging VEF for U.S dollars through securities transactions, our Venezuelan subsidiary has no recent history of entering into such exchange transactions. The Company uses the official exchange rate to translate the financial statements of its Venezuelan subsidiary, since we expect to obtain U.S.dollars at the official rate for future dividend remittances. The official exchange rate in Venezuela had been fixed at 2.15 VEF to 1 U.S.dollar for several years, despite significant inflation. On January8, 2010, the Venezuelan government announced the devaluation of its currency relative to the U.S.dollar. The official exchange rate for imported goods classified as essential, such as food and medicine, changed from 2.15 to 2.60, while payments for other non-essential goods moved to an exchange rate of 4.30. The majority, if not all, of our imported products in Venezuela are expected to fall into the essential classification and qualify for the 2.60 rate. However, our Venezuelan subsidiarys financial statements are translated using the 4.30 rate, as this is the rate expected to be applicable to dividend repatriations. During the third quarter of Fiscal 2010, the Company recorded a $59million currency translation loss as a result of the currency devaluation, which has been reflected as a component of accumulated other comprehensive loss within unrealized translation adjustment. The net asset position of our Venezuelan subsidiary has also been reduced as a result of the devaluation to approximately $66million at January27, 2010. Highly Inflationary Economy An economy is considered highly inflationary under U.S.GAAP if the cumulative inflation rate for a three year period meets or exceeds 100percent. Based on the blended National Consumer Price Index, the Venezuelan economy exceeded the three year cumulative inflation rate of 100percent during the third quarter of Fiscal 2010. As a result, the financial statements of our Venezuelan subsidiary will be consolidated and reported under highly inflationary accounting rules beginning on January28, 2010, the first day of our fiscal fourth quarter. Under highly inflationary accounting, the financial statements of our Venezuelan subsidiary will be remeasured into the Companys reporting currency (U.S.dollars) and future exchange gains and losses from the remeasurement of monetary assets and liabilities will be reflected in current earnings, rather than accumulated other comprehensive loss on the balance sheet, until such time as the economy is no longer considere

Recently Issued Accounting Stan

Recently Issued Accounting Standards
	9 Months Ended Jan. 27, 2010 USD / shares
Recently Issued Accounting Standards [Abstract]
Recently Issued Accounting Standards	(3) Recently Issued Accounting Standards On September15, 2009, the Financial Accounting Standards Board (FASB) Accounting Standards Codification (the Codification) became the single source of authoritative generally accepted accounting principles in the United States of America. The Codification changed the referencing of financial standards but did not change or alter existing U.S.GAAP. The Codification became effective for the Company in the second quarter of Fiscal 2010. Business Combinations and Consolidation On April30, 2009, the Company adopted new accounting guidance on business combinations and noncontrolling interests in consolidated financial statements. The guidance on business combinations impacts the accounting for any business combinations completed after April29, 2009. The nature and extent of the impact will depend upon the terms and conditions of any such transaction. The guidance on noncontrolling interests changes the accounting and reporting for minority interests, which have been recharacterized as noncontrolling interests and classified as a component of equity. Prior period financial statements and disclosures for existing minority interests have been restated in accordance with this guidance. All other requirements of this guidance will be applied prospectively. The adoption of the guidance on noncontrolling interests did not have a material impact on the Companys financial statements. In June 2009, the FASB issued an amendment to the accounting and disclosure requirements for transfers of financial assets. This amendment removes the concept of a qualifying special-purpose entity and requires that a transferor recognize and initially measure at fair value all assets obtained and liabilities incurred as a result of a transfer of financial assets accounted for as a sale. This amendment also requires additional disclosures about any transfers of financial assets and a transferors continuing involvement with transferred financial assets. This amendment is effective for fiscal years beginning after November15, 2009, and interim periods within those fiscal years. As of January27, 2010, the Company has approximately $323million of trade receivables associated with factoring and securitization programs that are not recognized on the balance sheet. The Company is currently evaluating these arrangements as well as any other potential impact of adopting this amendment on April29, 2010, the first day of Fiscal 2011. In June 2009, the FASB issued an amendment to the accounting and disclosure requirements for variable interest entities. This amendment changes how a reporting entity determines when an entity that is insufficiently capitalized or is not controlled through voting (or similar rights) should be consolidated. The determination of whether a reporting entity is required to consolidate another entity is based on, among other things, the purpose and design of the other entity and the reporting entitys ability to direct the activities of the other entity that most significantly impact its economic performance. The amendment also requires additional disclosures about a reporting entitys in

Discontinued Operations

Discontinued Operations
	9 Months Ended Jan. 27, 2010 USD / shares
Discontinued Operations [Abstract]
Discontinued Operations	(4) Discontinued Operations During the third quarter of Fiscal 2010, the Company completed the sale of its Appetizers And, Inc. frozen hors doeuvres business which was previously reported within the U.S.Foodservice segment, resulting in a $14.5million pre-tax ($10.4million after-tax) loss. Also during the third quarter, the Company completed the sale of its private label frozen desserts business in the U.K., resulting in a $31.4million pre-tax ($23.6million after-tax) loss. During the second quarter of Fiscal 2010, the Company completed the sale of its Kabobs frozen hors doeuvres business which was previously reported within the U.S.Foodservice segment, resulting in a $15.0million pre-tax ($10.9million after-tax) loss. The losses on each of these transactions have been recorded in discontinued operations. In accordance with accounting principles generally accepted in the United States of America, the operating results related to these businesses have been included in discontinued operations in the Companys consolidated statements of income for all periods presented. The following table presents summarized operating results for these discontinued operations: Third Quarter Ended Nine Months Ended January27, 2010 January28, 2009 January27, 2010 January28, 2009 FY 2010 FY 2009 FY 2010 FY 2009 (Millions of Dollars) Sales $ 10.9 $ 34.9 $ 63.7 $ 114.8 Net after-tax losses $ (1.6 ) $ (1.3 ) $ (4.5 ) $ (2.7 ) Tax benefit on losses $ 0.5 $ 0.3 $ 1.8 $ 0.4

Goodwill and Other Intangible A

Goodwill and Other Intangible Assets
	9 Months Ended Jan. 27, 2010 USD / shares
Goodwill and Other Intangible Assets [Abstract]
Goodwill and Other Intangible Assets	(5) Goodwill and Other Intangible Assets Changes in the carrying amount of goodwill for the nine months ended January27, 2010, by reportable segment, are as follows: North American Consumer U.S. Rest of Products Europe Asia/Pacific Foodservice World Total (Thousands of Dollars) Balance at April29, 2009 $ 1,074,841 $ 1,090,998 $ 248,222 $ 260,523 $ 13,204 $ 2,687,788 Acquisitions 6,378 6,378 Purchase accounting adjustments (557 ) (1,433 ) (1,990 ) Disposals (483 ) (2,849 ) (3,332 ) Translation adjustments 14,501 83,229 39,706 472 137,908 Balance at January27, 2010 $ 1,095,720 $ 1,173,187 $ 286,495 $ 257,674 $ 13,676 $ 2,826,752 During the third quarter of Fiscal 2010, the Company acquired Arthurs Fresh Company, a small chilled smoothies business in Canada. The Company recorded a preliminary purchase price allocation related to this acquisition, which is expected to be finalized upon completion of valuation procedures. Operating results of the acquired business have been included in the consolidated statement of income from the acquisition date forward. Pro-forma results of the Company, assuming the acquisition had occurred at the beginning of each period presented, would not be materially different from the results reported. Also during the third quarter, the Company finalized the purchase price allocation for the Golden Circle acquisition resulting primarily in adjustments between goodwill, other intangibles and income taxes. All of the purchase accounting adjustments reflected in the above table relate to acquisitions completed prior to April30, 2009, the first day of Fiscal 2010. During Fiscal 2010, the Company divested its Kabobs and Appetizers And, Inc. frozen hors doeuvres businesses within the U.S.Foodservice segment, and completed the sale of its private label frozen desserts business in the U.K. These sale transactions resulted in disposals of goodwill, trademarks and other intangible assets. See Note4 for additional information. Trademarks and other intangible assets at January27, 2010 and April29, 2009, subject to amortization expense, are as follows: January27, 2010 April29, 2009 Accum Accum Gross Amort Net Gross Amort Net (Thousands of Dollars) Tradema

Income Taxes

Income Taxes
	9 Months Ended Jan. 27, 2010 USD / shares
Income Taxes [Abstract]
Income Taxes	(6) Income Taxes The total amount of gross unrecognized tax benefits for uncertain tax positions, including positions impacting only the timing of tax benefits, was $61.4million and $86.6million, at January27, 2010 and April29, 2009, respectively. The amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate was $43.3million and $51.9million, at January27, 2010 and April29, 2009, respectively. It is reasonably possible that the amount of unrecognized tax benefits will decrease by as much as $10.5million in the next 12months due to the expiration of statutes in various foreign jurisdictions along with the progression of federal, state, and foreign audits in process. The Company classifies interest and penalties on tax uncertainties as a component of the provision for income taxes. The total amount of interest and penalties accrued at January27, 2010 was $18.2million and $1.3million, respectively. The corresponding amounts of accrued interest and penalties at April29, 2009 were $22.5million and $2.2million, respectively. The provision for income taxes consists of provisions for federal, state and foreign income taxes. The Company operates in an international environment with significant operations in various locations outside the U.S.Accordingly, the consolidated income tax rate is a composite rate reflecting the earnings in various locations and the applicable tax rates. In the normal course of business, the Company is subject to examination by taxing authorities throughout the world, including such major jurisdictions as Australia, Canada, Italy, the United Kingdom and the United States. The Company has substantially concluded all national income tax matters for years through Fiscal 2007 for the U.S.and the United Kingdom, through Fiscal 2005 for Canada and Italy, and through Fiscal 2004 for Australia. The effective tax rate for the nine months ended January27, 2010 was 27.1% compared to 27.6% last year. The decrease in the effective tax rate resulted primarily from increased benefits related to on-going tax planning, along with increased benefits resulting from resolutions and settlements of federal, state, and foreign uncertain tax positions, partially offset by a prior year discrete benefit resulting from the tax effects of law changes in the U.K. of approximately $10million.

Employees Stock Incentive Plans

Employees Stock Incentive Plans and Management Incentive Plans
	9 Months Ended Jan. 27, 2010 USD / shares
Employees' Stock Incentive Plans and Management Incentive Plans [Abstract]
Employees' Stock Incentive Plans and Management Incentive Plans	(7) Employees Stock Incentive Plans and Management Incentive Plans At January27, 2010, the Company had outstanding stock option awards, restricted stock units and restricted stock awards issued pursuant to various shareholder-approved plans and a shareholder-authorized employee stock purchase plan, as described on pages 55 to 60 of the Companys Annual Report on Form10-K for the fiscal year ended April29, 2009. The compensation cost related to these plans recognized in general and administrative expenses (GA), and the related tax benefit was $8.1million and $2.5million for the third quarter ended January27, 2010 and $25.4million and $7.9million for the nine months ended January27, 2010, respectively. The compensation cost related to these plans recognized in GA, and the related tax benefit was $8.0million and $2.9million for the third quarter ended January28, 2009 and $31.2million and $10.8million for the nine months ended January28, 2009, respectively. The Company granted 1,755,714 and 1,539,703 option awards to employees during the nine months ended January27, 2010 and January28, 2009, respectively. The weighted average fair value per share of the options granted during the nine months ended January27, 2010 and January28, 2009 as computed using the Black-Scholes pricing model, was $4.70 and $5.77, respectively. These awards were sourced from the 2000 Stock Option Plan and Fiscal Year 2003 Stock Incentive Plan. The weighted average assumptions used to estimate the fair values are as follows: Nine Months Ended January27, January28, 2010 2009 Dividend yield 4.3 % 3.3 % Expected volatility 20.2 % 14.9 % Weighted-average expected life (in years) 5.5 5.5 Risk-free interest rate 2.7 % 3.1 % The Company granted 511,432 and 476,682 restricted stock units to employees during the nine months ended January27, 2010 and January28, 2009 at weighted average grant prices of $39.09 and $50.26, respectively. In June of Fiscal 2010, the Company granted performance awards as permitted in the Fiscal Year 2003 Stock Incentive Plan, subject to the achievement of certain performance goals. These performance awards are tied to the Companys relative Total Shareholder Return (Relative TSR) Ranking within the defined Long-term Performance Program (LTPP) peer group and the 2-year average after-tax Return on Invested Capital (ROIC) metrics. The Relative TSR metric is based on the two-year cumulative return to shareholders from the change in stock price and dividends paid between the starting and ending dates. The starting value was based on the average of each LTPP peer group company stock price for the 60 trading days prior to and including April30, 2009. The ending value will be based on the average stock price for the 60 trading days prior to and including the close of the Fiscal 2011year end, plus dividends paid over the 2year performance period. The compensation cost related to current and prior period LTPP awards recognized in GA, and the related tax benefit was $7.2mill

Pensions and Other Post-Retirem

Pensions and Other Post-Retirement Benefits
	9 Months Ended Jan. 27, 2010 USD / shares
Pensions and Other Post-Retirement Benefits [Abstract]
Pensions and Other Post-Retirement Benefits	(8) Pensions and Other Post-Retirement Benefits The components of net periodic benefit cost are as follows: Third Quarter Ended January27, 2010 January28, 2009 January27, 2010 January28, 2009 Pension Benefits Post-Retirement Benefits (Thousands of Dollars) Service cost $ 8,528 $ 7,600 $ 1,507 $ 1,586 Interest cost 37,803 33,111 3,785 3,787 Expected return on plan assets (53,560 ) (47,816 ) Amortization of prior service cost 521 733 (948 ) (957 ) Amortization of unrecognized loss 13,523 7,711 135 918 Settlement charge 498 Curtailment gain (297 ) Net periodic benefit cost 7,016 1,339 4,479 5,334 Less periodic benefit cost associated with discontinued operations 132 301 Periodic benefit cost associated with continuing operations $ 6,884 $ 1,038 $ 4,479 $ 5,334 Nine Months Ended January27, 2010 January28, 2009 January27, 2010 January28, 2009 Pension Benefits Post-Retirement Benefits (Thousands of Dollars) Service cost $ 24,314 $ 26,365 $ 4,476 $ 4,925 Interest cost 112,803 112,195 11,282 11,581 Expected return on plan assets (159,335 ) (162,093 ) Amortization of prior service cost 1,598 2,460 (2,849 ) (2,854 ) Amortization of unrecognized loss 40,458 25,281 405 2,763 Settlement charge 2,587 Curtailment gain (297 ) Net periodic benefit cost 22,128 4,208 13,314 16,415 Less periodic benefit cost associated with discontinued operations 924 1,080 Periodic benefit cost associated with continuing operations $ 21,204 $ 3,128 $ 13,314 $ 16,415 During the first nine months of Fiscal 2010, the Company contributed $242million to these defined benefit plans, of which $200million was discretionary. The Company will likely make additional discretionary contributions to the defined benefit plans during the fourth quarter of Fiscal 20

Segments

Segments
	9 Months Ended Jan. 27, 2010 USD / shares
Segments [Abstract]
Segments	(9) Segments The Companys segments are primarily organized by geographical area. The composition of segments and measure of segment profitability are consistent with that used by the Companys management. Descriptions of the Companys reportable segments are as follows: North American Consumer ProductsThis segment primarily manufactures, markets and sells ketchup, condiments, sauces, pasta meals, and frozen potatoes, entrees, snacks, and appetizers to the grocery channels in the United States of America and includes our Canadian business. EuropeThis segment includes the Companys operations in Europe, including Eastern Europe and Russia, and sells products in all of the Companys categories. Asia/PacificThis segment includes the Companys operations in Australia, New Zealand, India, Japan, China, South Korea, Indonesia, and Singapore. This segments operations include products in all of the Companys categories. U.S.FoodserviceThis segment primarily manufactures, markets and sells branded and customized products to commercial and non-commercial food outlets and distributors in the United States of America including ketchup, condiments, sauces, frozen soups and desserts. Rest of WorldThis segment includes the Companys operations in Africa, Latin America, and the Middle East that sell products in all of the Companys categories. The Companys management evaluates performance based on several factors including net sales, operating income, and the use of capital resources. Inter-segment revenues, items below the operating income line of the consolidated statements of income, and certain costs associated with corporation-wide productivity initiatives are not presented by segment, since they are excluded from the measure of segment profitability reviewed by the Companys management. The following table presents information about the Companys reportable segments: Third Quarter Ended Nine Months Ended January27, 2010 January28, 2009 January27, 2010 January28, 2009 FY 2010 FY 2009 FY 2010 FY 2009 (Thousands of Dollars) Net external sales: North American Consumer Products $ 815,042 $ 761,605 $ 2,333,795 $ 2,330,065 Europe 878,263 783,675 2,493,054 2,543,673 Asia/Pacific 500,060 354,430 1,461,251 1,198,401 U.S. Foodservice 355,091 366,198 1,064,549 1,076,877 Rest of World 133,246 113,803 417,524 346,547 Consolidated Totals $ 2,681,702 $ 2,379,711 $ 7,770,173 $ 7,495,563 Operating income (loss): North American Consumer Products $ 207,048 $ 191,437 $ 592,121 $ 551,048 Europe 156,094

Net Income Per Common Share

Net Income Per Common Share
	9 Months Ended Jan. 27, 2010 USD / shares
Net Income Per Common Share [Abstract]
Net Income Per Common Share	(10) Net Income Per Common Share The following are reconciliations of income from continuing operations to income from continuing operations applicable to common stock and the number of common shares outstanding used to calculate basic EPS to those shares used to calculate diluted EPS: Third Quarter Ended Nine Months Ended January27, 2010 January28, 2009 January27, 2010 January28, 2009 FY 2010 FY 2009 FY 2010 FY 2009 (In Thousands) Income from continuing operations attributable to H. J. Heinz Company $ 264,115 $ 243,550 $ 721,915 $ 750,608 Allocation to participating securities (See Note3) 580 930 1,863 3,385 Preferred dividends 3 3 9 9 Income from continuing operations applicable to common stock $ 263,532 $ 242,617 $ 720,043 $ 747,214 Average common shares outstandingbasic 315,955 314,538 315,519 313,417 Effect of dilutive securities: Convertible preferred stock 105 108 105 106 Stock options, restricted stock and the global stock purchase plan 1,976 4,087 2,003 4,472 Average common shares outstandingdiluted 318,036 318,733 317,627 317,995 Diluted earnings per share is based upon the average shares of common stock and dilutive common stock equivalents outstanding during the periods presented. Common stock equivalents arising from dilutive stock options, restricted common stock units, and the global stock purchase plan are computed using the treasury stock method. Options to purchase an aggregate of 4.3million shares of common stock for the third quarter and nine months ended January27, 2010 and 2.8million shares of common stock for the third quarter and nine months ended January28, 2009 were not included in the computation of diluted earnings per share because inclusion of these options would be anti-dilutive. These options expire at various points in time through 2016.

Comprehensive Income

Comprehensive Income
	9 Months Ended Jan. 27, 2010 USD / shares
Comprehensive Income [Abstract]
Comprehensive Income	(11) Comprehensive Income The following table provides a summary of comprehensive income attributable to H. J. Heinz Company: Third Quarter Ended Nine Months Ended January27, 2010 January28, 2009 January27, 2010 January28, 2009 FY 2010 FY 2009 FY 2010 FY 2009 (Thousands of Dollars) Net income $ 231,149 $ 243,776 $ 687,568 $ 760,519 Other comprehensive income/(loss): Foreign currency translation adjustments (171,327 ) (224,542 ) 336,028 (1,062,731 ) Reclassification of net pension and post-retirement benefit losses to net income 7,987 5,471 27,458 16,606 New measurement date provisions 1,506 Net deferred gains/(losses) on derivatives from periodic revaluations (8,613 ) (2,855 ) (16,967 ) 14,991 Net deferred losses/(gains) on derivatives reclassified to earnings 819 (2,150 ) 970 798 Total comprehensive income/(loss) 60,015 19,700 1,035,057 (268,311 ) Comprehensive income attributable to the noncontrolling interest (3,319 ) (163 ) (20,230 ) (166 ) Comprehensive income/(loss) attributable to H. J. Heinz Company $ 56,696 $ 19,537 $ 1,014,827 $ (268,477 ) The following table summarizes the allocation of total comprehensive income between H. J. Heinz Company and the noncontrolling interest for the third quarter and nine months ended January27, 2010: Third Quarter Ended Nine Months Ended H. J. Heinz Noncontrolling H. J. Heinz Noncontrolling Company Interest Total Company Interest Total (Thousands of Dollars) Net income $ 228,527 $ 2,622 $ 231,149 $ 672,526 $ 15,042 $ 687,568 Other comprehensive income: Foreign currency translation adjustments (173,044 ) 1,717 (171,327 ) 329,657 6,371 336,028 Reclassification of net pension and post-retirement benefit losses/(gains) to net income 8,841 (854 ) 7,987 28,368 (910 ) 27,458 Net deferred losses on derivatives from periodic revaluations (8,407 ) (206 ) (8,613 ) (16,519 ) (448 ) (16,967 ) Net deferred losses on derivatives reclassified

Changes in Equity

Changes in Equity
	9 Months Ended Jan. 27, 2010 USD / shares
Changes in Equity [Abstract]
Changes in Equity	(12) Changes in Equity The following table provides a summary of the changes in the carrying amounts of total equity, H. J. Heinz Company shareholders equity and equity attributable to the noncontrolling interest: H. J. Heinz Company Capital Additional Retained Treasury Accum Noncontrolling Total Stock Capital Earnings Stock OCI Interest (Thousands of Dollars) Balance as of April29, 2009 $ 1,279,105 $ 107,844 $ 737,917 $ 6,525,719 $ (4,881,842 ) $ (1,269,700 ) $ 59,167 Comprehensive income(1) 1,035,057 672,526 342,301 20,230 Dividends paid to shareholders of H. J. Heinz Company (399,615 ) (399,615 ) Dividends paid to noncontrolling interest (7,438 ) (7,438 ) Stock options exercised, net of shares tendered for payment 24,342 (8,949 ) 33,291 Stock option expense 6,754 6,754 Restricted stock unit activity 6,518 (13,555 ) 20,073 Change in ownership interest in subsidiary(2) (61,874 ) (54,209 ) (2,198 ) (5,467 ) Other 7,296 (2,214 ) (673 ) 10,183 Balance as of January27, 2010 $ 1,890,145 $ 107,844 $ 665,744 $ 6,797,957 $ (4,818,295 ) $ (929,597 ) $ 66,492 (1) The allocation of the individual components of comprehensive income attributable to H. J. Heinz Company and the noncontrolling interest is disclosed in Note11. (2) During the third quarter of Fiscal 2010, the Company acquired the remaining 49% interest in Cairo Food Industries, S.A.E., an Egyptian subsidiary of the Company that manufactures ketchup, condiments and sauces, for $61.9million. Prior to the transaction, the Company was the owner of 51% of the business.

Debt and Financing Arrangements

Debt and Financing Arrangements
	9 Months Ended Jan. 27, 2010 USD / shares
Debt and Financing Arrangements [Abstract]
Debt and Financing Arrangements	(13) Debt and Financing Arrangements On June12, 2009, the Company entered into a three-year $175million accounts receivable securitization program. Under the terms of the agreement, the Company sells, on a revolving basis, its receivables to a wholly-owned, bankruptcy-remote-subsidiary. This subsidiary then sells all of the rights, title and interest in a pool of these receivables to an unaffiliated entity. After the sale, the Company, as servicer of the assets, collects the receivables on behalf of the unaffiliated entity. The amount of receivables sold through this program as of January27, 2010 was $146.8million. The proceeds from this securitization program are recognized on the statements of cash flows as a component of operating activities. On July29, 2009, H. J. Heinz Finance Company (HFC), a subsidiary of Heinz, issued $250million of 7.125%notes due 2039. The notes are fully, unconditionally and irrevocably guaranteed by the Company. The proceeds from the notes were used for payment of the cash component of the exchange transaction discussed below as well as various expenses relating to the exchange, and for general corporate purposes. On August6, 2009, HFC issued $681million of 7.125%notes due 2039 (of the same series as the notes issued in July 2009), and $217.5million of cash, in exchange for $681million of its outstanding 15.590% dealer remarketable securities due December1, 2020. In addition, HFC terminated a portion of the remarketing option by paying the remarketing agent a cash payment of $89.0million. The exchange transaction was accounted for as a modification of debt. Accordingly, cash payments used in the exchange, including the payment to the remarketing agent, have been accounted for as a reduction in the book value of the debt, and will be amortized to interest expense under the effective yield method. Additionally, the Company terminated its $175million notional total rate of return swap in August 2009 in connection with the dealer remarketable securities exchange transaction. See Note15 for additional information. During the second quarter of Fiscal 2010, the Company entered into a three-year 15billion Japanese yen denominated credit agreement (approximately $167million). This credit agreement is yen London Interbank Offered Rates (LIBOR) based and has been effectively converted to a U.S.dollar fixed rate facility using cross-currency interest rate swaps. See Note15 for additional information. During the third quarter of Fiscal 2010, the Company paid off its A$281million Australian denominated borrowings ($257million), which matured on December16, 2009. Also during the third quarter of Fiscal 2010, the Company entered into a C$25million Canadian dollar uncommitted receivables sales facility. Under the terms of the agreement, the Company sells its receivables from time to time to an unaffiliated entity. After the sale, the Company, as servicer of the assets, collects the receivables on behalf of the unaffiliated entity. The amount of receivables sold through this agreement as of January27, 2010 was $18.8million. The Company was in compliance with all of its debt covenants

Fair Value Measurements

Fair Value Measurements
	9 Months Ended Jan. 27, 2010 USD / shares
Fair Value Measurements [Abstract]
Fair Value Measurements	(14) Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy consists of three levels to prioritize the inputs used in valuations, as defined below: Level1:Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities in active markets. Level2:Inputs other than quoted prices included within Level1 that are observable for the asset or liability, either directly or indirectly. Level3:Unobservable inputs for the asset or liability. As of January27, 2010, the fair values of the Companys assets and liabilities measured on a recurring basis are categorized as follows: Level 1 Level 2 Level 3 Total (Thousands of Dollars) Assets: Derivatives(a) $ $ 144,069 $ $ 144,069 Total assets at fair value $ $ 144,069 $ $ 144,069 Liabilities: Derivatives(a) $ $ 24,894 $ $ 24,894 Total liabilities at fair value $ $ 24,894 $ $ 24,894 As of April29, 2009, the fair values of the Companys assets and liabilities measured on a recurring basis are categorized as follows: Level 1 Level 2 Level 3 Total (Thousands of Dollars) Assets: Derivatives(a) $ $ 219,845 $ $ 219,845 Total assets at fair value $ $ 219,845 $ $ 219,845 Liabilities: Derivatives(a) $ $ 12,847 $ $ 12,847 Total liabilities at fair value $ $ 12,847 $ $ 12,847 (a) Foreign currency derivative contracts are valued based on observable market spot and forward rates, and are classified within Level2 of the fair value hierarchy. Interest rate swaps are valued based on observable market swap rates, and are classified within Level2 of the fair value hierarchy. Cross-currency interest rate swaps are valued based on observable market spot and swap rates, and are classified within Level2 of the fair value hierarchy. The Companys total rate of return swap was terminated in the second quarter of Fiscal 2010. As of April29, 2009, the total rate of return swap was valued based on observable market swap rates and the Companys credit spread, and was classified within Level2 of the fair value hie

Derivative Financial Instrument

Derivative Financial Instruments and Hedging Activities
	9 Months Ended Jan. 27, 2010 USD / shares
Derivative Financial Instruments and Hedging Activities [Abstract]
Derivative Financial Instruments and Hedging Activities	(15) Derivative Financial Instruments and Hedging Activities The Company operates internationally, with manufacturing and sales facilities in various locations around the world, and utilizes certain derivative financial instruments to manage its foreign currency, debt and interest rate exposures. At January27, 2010, the Company had outstanding currency exchange, interest rate, and cross-currency interest rate derivative contracts with notional amounts of $1.77billion, $1.52billion and $167million, respectively. At April29, 2009, the Company had outstanding currency exchange, interest rate, and total rate of return derivative contracts with notional amounts of $1.25billion, $1.52billion and $175million, respectively. The following table presents the fair values and corresponding balance sheet captions of the Companys derivative instruments as of January27, 2010 and April29, 2009: January27, 2010 April29, 2009 Cross- Cross- Currency Currency Foreign Interest Interest Rate Foreign Interest Interest Rate Exchange Rate Swap Exchange Rate Swap Contracts Contracts Contracts Contracts Contracts Contracts (Dollars in Thousands) Assets: Derivatives designated as hedging instruments: Other receivables, net $ 6,183 $ 73,288 $ $ 28,406 $ 64,502 $ Other non-current assets 14,928 48,696 8,659 86,434 21,111 121,984 37,065 150,936 Derivatives not designated as hedging instruments: Other receivables, net 974 11,644 Other non-current assets 20,200 974 11,644 20,200 Total assets $ 22,085 $ 121,984 $ $ 48,709 $ 171,136 $ Liabilities: Derivatives designated as hedging instruments: Other payables $ 14,926 $ $ 3,342 $ 12,198 $ $ Other liabilities 537 720 598