Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 29, 2019 | Jul. 27, 2019 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Entity Registrant Name | KELLOGG COMPANY | |
Document Period End Date | Jun. 29, 2019 | |
Document Transition Report | false | |
Entity File Number | 1-4171 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 38-0710690 | |
Entity Address, Address Line One | One Kellogg Square | |
Entity Address, Address Line Two | P.O. Box 3599 | |
Entity Address, City or Town | Battle Creek | |
Entity Address, State or Province | MI | |
Entity Address, Postal Zip Code | 49016-3599 | |
City Area Code | 269 | |
Local Phone Number | 961-2000 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 340,631,924 | |
Amendment Flag | false | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2019 | |
Entity Central Index Key | 0000055067 | |
Current Fiscal Year End Date | --12-28 | |
Common stock | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Common Stock, $.25 par value per share | |
Trading Symbol | K | |
Security Exchange Name | NYSE | |
1.750% Senior Notes Due 2021 [Member] | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | 1.750% Senior Notes due 2021 | |
Trading Symbol | K 21 | |
Security Exchange Name | NYSE | |
0.800% Senior Notes Due 2022 [Member] | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | 0.800% Senior Notes due 2022 | |
Trading Symbol | K 22A | |
Security Exchange Name | NYSE | |
1.000% Senior Notes Due 2024 [Member] | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | 1.000% Senior Notes due 2024 | |
Trading Symbol | K 24 | |
Security Exchange Name | NYSE | |
1.250% Senior Notes Due 2025 [Member] | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | 1.250% Senior Notes due 2025 | |
Trading Symbol | K 25 | |
Security Exchange Name | NYSE |
Consolidated Balance Sheet (Una
Consolidated Balance Sheet (Unaudited) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Current assets | ||
Cash and cash equivalents | $ 340 | $ 321 |
Accounts receivable, net | 1,643 | 1,375 |
Inventories | 1,234 | 1,330 |
Other current assets | 175 | 131 |
Current assets held for sale | 112 | 0 |
Total current assets | 3,504 | 3,157 |
Property, net | 3,526 | 3,731 |
Operating lease right-of-use assets | 415 | 0 |
Goodwill | 5,871 | 6,050 |
Other intangibles, net | 2,587 | 3,361 |
Investments in unconsolidated entities | 407 | 413 |
Other assets | 1,171 | 1,068 |
Noncurrent assets held for sale | 1,188 | 0 |
Total assets | 18,669 | 17,780 |
Current liabilities | ||
Current maturities of long-term debt | 508 | 510 |
Notes payable | 568 | 176 |
Accounts payable | 2,401 | 2,427 |
Current operating lease liabilities | 103 | 0 |
Other current liabilities | 1,409 | 1,416 |
Total current liabilities | 4,989 | 4,529 |
Long-term debt | 8,262 | 8,207 |
Operating lease liabilities | 321 | 0 |
Deferred income taxes | 778 | 730 |
Pension liability | 619 | 651 |
Other liabilities | 488 | 504 |
Commitments and contingencies | ||
Equity | ||
Common stock, $.25 par value | 105 | 105 |
Capital in excess of par value | 895 | 895 |
Retained earnings | 7,858 | 7,652 |
Treasury stock, at cost | (4,739) | (4,551) |
Accumulated other comprehensive income (loss) | (1,469) | (1,500) |
Total Kellogg Company equity | 2,650 | 2,601 |
Noncontrolling interests | 562 | 558 |
Total equity | 3,212 | 3,159 |
Total liabilities and equity | $ 18,669 | $ 17,780 |
Consolidated Balance Sheet (U_2
Consolidated Balance Sheet (Unaudited) (Parenthetical) - $ / shares | Jun. 29, 2019 | Dec. 29, 2018 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.25 | $ 0.25 |
Consolidated Statement of Incom
Consolidated Statement of Income (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Income Statement [Abstract] | ||||
Net sales | $ 3,461 | $ 3,360 | $ 6,983 | $ 6,761 |
Cost of goods sold | 2,275 | 2,151 | 4,690 | 4,300 |
Selling, general and administrative expense | 789 | 735 | 1,515 | 1,477 |
Operating profit | 397 | 474 | 778 | 984 |
Interest expense | 75 | 72 | 149 | 141 |
Other income (expense), net | 45 | 69 | 97 | 139 |
Income before income taxes | 367 | 471 | 726 | 982 |
Income taxes | 74 | 70 | 146 | 137 |
Earnings (loss) from unconsolidated entities | (1) | 198 | (3) | 198 |
Net income | 292 | 599 | 577 | 1,043 |
Net income attributable to noncontrolling interests | 6 | 3 | 9 | 3 |
Net income attributable to Kellogg Company | $ 286 | $ 596 | $ 568 | $ 1,040 |
Per share amounts: | ||||
Basic earnings (in dollars per share) | $ 0.84 | $ 1.72 | $ 1.66 | $ 3 |
Diluted earnings (in dollars per share) | $ 0.84 | $ 1.71 | $ 1.66 | $ 2.99 |
Average shares outstanding: | ||||
Basic (in shares) | 340 | 347 | 341 | 346 |
Diluted (in shares) | 341 | 348 | 342 | 348 |
Actual shares outstanding at period end (in shares) | 341 | 346 | 341 | 346 |
Consolidated Statement of Compr
Consolidated Statement of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 292 | $ 599 | $ 577 | $ 1,043 |
Other comprehensive income (loss), pre-tax: | ||||
Foreign currency translation adjustments, pre-tax | (5) | (54) | 61 | (24) |
Cash flow hedges, pre-tax: | ||||
Unrealized gain (loss) on cash flow hedges, pre-tax | 3 | 3 | ||
Reclassification to net income, pre-tax | 2 | 2 | 3 | 4 |
Postretirement and postemployment benefits reclassification to net income, pre-tax: | ||||
Net experience (gain) loss | (1) | (1) | (2) | (2) |
Unrealized gain (loss) on available-for-sale securities, pre-tax | 1 | 3 | ||
Other comprehensive income (loss), pre-tax | (3) | (50) | 65 | (19) |
Other comprehensive income (loss), tax (expense) benefit | ||||
Foreign currency translation adjustments, tax (expense) benefit | 1 | (46) | (9) | (27) |
Cash flow hedges, tax (expense) benefit: | ||||
Unrealized gain (loss) on cash flow hedges, tax (expense) benefit | (1) | (1) | ||
Reclassification to net income, tax (expense) benefit | (1) | (1) | (1) | (1) |
Postretirement and postemployment benefits reclassification to net income, tax (expense) benefit: | ||||
Net experience loss, tax (expense) benefit | 1 | 0 | 1 | 0 |
Unrealized gain (loss) on available-for-sale securities, tax (expense) benefit | 0 | 0 | ||
Other comprehensive income (loss), tax (expense) benefit | 1 | (48) | (9) | (29) |
Other comprehensive income (loss), after tax: | ||||
Foreign currency translation adjustments, after-tax | (4) | (100) | 52 | (51) |
Cash flow hedges, after tax | ||||
Unrealized gain (loss) on cash flow hedges, after-tax | 2 | 2 | ||
Reclassification to net income, after-tax | 1 | 1 | 2 | 3 |
Postretirement and postemployment benefits reclassification to net income, after-tax: | ||||
Net experience (gain) loss, after-tax | 0 | (1) | (1) | (2) |
Unrealized gain (loss) on available-for-sale securities, after-tax | 1 | 3 | ||
Other comprehensive income (loss) | (2) | (98) | 56 | (48) |
Comprehensive income | 290 | 501 | 633 | 995 |
Net income attributable to noncontrolling interests | 6 | 3 | 9 | 3 |
Other comprehensive income (loss) attributable to noncontrolling interests | 0 | (4) | 3 | (4) |
Comprehensive income attributable to Kellogg Company | $ 284 | $ 502 | $ 621 | $ 996 |
Consolidated Statement of Equit
Consolidated Statement of Equity (Unaudited) - USD ($) shares in Millions, $ in Millions | Total | Common stock | Capital in excess of par value | Retained earnings | Treasury stock | Accumulated other comprehensive income (loss) | Total Kellogg Company equity | Non-controlling interests |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 2,194 | |||||||
Balance at Dec. 30, 2017 | $ 105 | $ 878 | $ 7,069 | $ (4,417) | $ (1,457) | $ 2,178 | $ 16 | |
Balance (in shares) at Dec. 30, 2017 | 421 | 75 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Common stock repurchases (in shares) | 1 | |||||||
Common stock repurchases | (50) | $ (50) | (50) | |||||
Net income | 1,043 | 1,040 | 1,040 | 3 | ||||
Acquisition of noncontrolling interest-Multipro | 552 | 0 | 552 | |||||
Dividends declared | (374) | (374) | (374) | |||||
Distributions to Noncontrolling interest | (1) | 0 | (1) | |||||
Other comprehensive income (loss) | (48) | (44) | (44) | (4) | ||||
Stock compensation | 30 | 30 | 0 | 30 | ||||
Stock options exercised and other (in shares) | (2) | |||||||
Stock options exercised and other | 58 | (42) | 8 | $ 92 | 58 | |||
Balance (in shares) at Jun. 30, 2018 | 421 | 74 | ||||||
Balance at Jun. 30, 2018 | $ 105 | 866 | 7,743 | $ (4,375) | (1,501) | 2,838 | 566 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 2,554 | |||||||
Balance at Mar. 31, 2018 | $ 105 | 852 | 7,334 | $ (4,346) | (1,407) | 2,538 | 16 | |
Balance (in shares) at Mar. 31, 2018 | 421 | 74 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Common stock repurchases (in shares) | 1 | |||||||
Common stock repurchases | (50) | $ (50) | (50) | |||||
Net income | 599 | 596 | 596 | 3 | ||||
Acquisition of noncontrolling interest-Multipro | 552 | 0 | 552 | |||||
Dividends declared | (187) | (187) | (187) | |||||
Distributions to Noncontrolling interest | (1) | 0 | (1) | |||||
Other comprehensive income (loss) | (98) | (94) | (94) | (4) | ||||
Stock compensation | 14 | 14 | 14 | |||||
Stock options exercised and other (in shares) | (1) | |||||||
Stock options exercised and other | 21 | 0 | 0 | $ 21 | 21 | |||
Balance (in shares) at Jun. 30, 2018 | 421 | 74 | ||||||
Balance at Jun. 30, 2018 | $ 105 | 866 | 7,743 | $ (4,375) | (1,501) | 2,838 | 566 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 3,404 | |||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 3,159 | |||||||
Balance at Dec. 29, 2018 | 2,601 | $ 105 | 895 | 7,652 | $ (4,551) | (1,500) | 2,601 | 558 |
Balance (in shares) at Dec. 29, 2018 | 421 | 77 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Reclassification of tax effects relating to U.S. tax reform | 22 | |||||||
Balance (in shares) at Mar. 30, 2019 | 421 | 80 | ||||||
Balance at Mar. 30, 2019 | $ 105 | 877 | 7,762 | $ (4,744) | (1,467) | 2,533 | 564 | |
Balance at Dec. 29, 2018 | 2,601 | $ 105 | 895 | 7,652 | $ (4,551) | (1,500) | 2,601 | 558 |
Balance (in shares) at Dec. 29, 2018 | 421 | 77 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Common stock repurchases (in shares) | 4 | |||||||
Common stock repurchases | (220) | $ (220) | (220) | |||||
Net income | 577 | 568 | 568 | 9 | ||||
Sale of subsidiary shares to noncontrolling interest | 1 | 0 | 1 | |||||
Dividends declared | (380) | (380) | (380) | |||||
Distributions to Noncontrolling interest | (9) | 0 | (9) | |||||
Other comprehensive income (loss) | 56 | 53 | 53 | 3 | ||||
Reclassification of tax effects relating to U.S. tax reform | 0 | 22 | (22) | 0 | ||||
Stock compensation | 29 | 29 | 29 | |||||
Stock options exercised and other (in shares) | (1) | |||||||
Stock options exercised and other | (1) | (29) | (4) | $ 32 | (1) | |||
Balance (in shares) at Jun. 29, 2019 | 421 | 80 | ||||||
Balance at Jun. 29, 2019 | 2,650 | $ 105 | 895 | 7,858 | $ (4,739) | (1,469) | 2,650 | 562 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 3,097 | |||||||
Balance at Mar. 30, 2019 | $ 105 | 877 | 7,762 | $ (4,744) | (1,467) | 2,533 | 564 | |
Balance (in shares) at Mar. 30, 2019 | 421 | 80 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 292 | 286 | 286 | 6 | ||||
Sale of subsidiary shares to noncontrolling interest | 1 | 0 | 1 | |||||
Dividends declared | (188) | (188) | (188) | |||||
Distributions to Noncontrolling interest | (9) | 0 | (9) | |||||
Other comprehensive income (loss) | (2) | (2) | (2) | |||||
Stock compensation | 16 | 16 | 16 | |||||
Stock options exercised and other (in shares) | 0 | |||||||
Stock options exercised and other | 5 | 2 | (2) | $ 5 | 5 | |||
Balance (in shares) at Jun. 29, 2019 | 421 | 80 | ||||||
Balance at Jun. 29, 2019 | 2,650 | $ 105 | $ 895 | $ 7,858 | $ (4,739) | $ (1,469) | $ 2,650 | $ 562 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | $ 3,212 |
Consolidated Statement of Equ_2
Consolidated Statement of Equity Consolidated Statement of Equity (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Statement of Stockholders' Equity [Abstract] | ||||
Dividends declared | $ 0.56 | $ 0.54 | $ 1.12 | $ 1.08 |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows (Unaudited) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 29, 2019 | Jun. 30, 2018 | |
Operating activities | ||
Net income | $ 577 | $ 1,043 |
Adjustments to reconcile net income to operating cash flows: | ||
Depreciation and amortization | 243 | 234 |
Postretirement benefit plan expense (benefit) | (65) | (86) |
Deferred income taxes | 23 | 69 |
Stock compensation | 29 | 30 |
Gain on unconsolidated entities, net | 0 | (200) |
Other | 1 | (67) |
Postretirement benefit plan contributions | (12) | (274) |
Changes in operating assets and liabilities, net of acquisitions: | ||
Trade receivables | (239) | (83) |
Inventories | (6) | (38) |
Accounts payable | 29 | 64 |
All other current assets and liabilities | (60) | (245) |
Net cash provided by (used in) operating activities | 520 | 447 |
Investing activities | ||
Additions to properties | (294) | (270) |
Acquisitions, net of cash acquired | (8) | (28) |
Investments in unconsolidated entities | 0 | (388) |
Acquisition of cost method investments | 0 | (4) |
Purchases of available for sale securities | (16) | 0 |
Sales of available for sale securities | 16 | 0 |
Other | (25) | 29 |
Net cash provided by (used in) investing activities | (327) | (661) |
Financing activities | ||
Net issuances (reductions) of notes payable | 391 | (76) |
Issuances of long-term debt | 28 | 993 |
Reductions of long-term debt | 0 | (401) |
Net issuances of common stock | 12 | 70 |
Common stock repurchases | (220) | (50) |
Cash dividends | (380) | (374) |
Other | (8) | 0 |
Net cash provided by (used in) financing activities | (177) | 162 |
Effect of exchange rate changes on cash and cash equivalents | 3 | 28 |
Increase (decrease) in cash and cash equivalents | 19 | (24) |
Cash and cash equivalents at beginning of period | 321 | 281 |
Cash and cash equivalents at end of period | 340 | 257 |
Supplemental cash flow disclosures | ||
Interest paid | 154 | 151 |
Income taxes paid | 157 | 76 |
Supplemental cash flow disclosures of non-cash investing activities | ||
Additions to properties included in accounts payable | $ 100 | $ 77 |
Accounting Policies
Accounting Policies | 6 Months Ended |
Jun. 29, 2019 | |
Accounting Policies [Abstract] | |
Accounting Policies | Accounting policies Basis of presentation The unaudited interim financial information of Kellogg Company (the Company) included in this report reflects all adjustments, all of which are of a normal and recurring nature, that management believes are necessary for a fair statement of the results of operations, comprehensive income, financial position, equity and cash flows for the periods presented. This interim information should be read in conjunction with the financial statements and accompanying footnotes within the Company’s 2018 Annual Report on Form 10-K. The condensed balance sheet information at December 29, 2018 was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States. The results of operations for the quarterly period ended June 29, 2019 are not necessarily indicative of the results to be expected for other interim periods or the full year. Accounts payable The Company has agreements with certain third parties to provide accounts payable tracking systems which facilitates participating suppliers’ ability to monitor and, if elected, sell payment obligations from the Company to designated third-party financial institutions. Participating suppliers may, at their sole discretion, make offers to sell one or more payment obligations of the Company prior to their scheduled due dates at a discounted price to participating financial institutions. The Company’s goal in entering into these agreements is to capture overall supplier savings, in the form of payment terms or vendor funding, created by facilitating suppliers’ ability to sell payment obligations, while providing them with greater working capital flexibility. We have no economic interest in the sale of these suppliers’ receivables and no direct financial relationship with the financial institutions concerning these services. The Company’s obligations to its suppliers, including amounts due and scheduled payment dates, are not impacted by suppliers’ decisions to sell amounts under these arrangements. However, the Company’s right to offset balances due from suppliers against payment obligations is restricted by this agreement for those payment obligations that have been sold by suppliers. As of June 29, 2019 , $823 million of the Company’s outstanding payment obligations had been placed in the accounts payable tracking system, and participating suppliers had sold $595 million of those payment obligations to participating financial institutions. As of December 29, 2018, $893 million of the Company’s outstanding payment obligations had been placed in the accounts payable tracking system, and participating suppliers had sold $701 million of those payment obligations to participating financial institutions. New accounting standards adopted in the period Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. In February 2018, the Financial Accounting Standards Board (FASB) issued an Accounting Standard Update (ASU) permitting a company to reclassify the disproportionate income tax effects of the Tax Cuts and Jobs Act of 2017 on items within accumulated other comprehensive income (AOCI) to retained earnings. We elected to adopt the ASU effective in the first quarter of 2019 and reclassified the disproportionate income tax effect recorded within AOCI to retained earnings. This resulted in a decrease to AOCI and an increase to retained earnings of $22 million . The adjustment primarily related to deferred taxes previously recorded for pension and other postretirement benefits, as well as hedging positions for debt and net investment hedges. Leases. In February 2016, the FASB issued an ASU requiring the recognition of lease assets and lease liabilities by lessees for all leases with terms greater than 12 months. The distinction between finance leases and operating leases remains, with similar classification criteria as current GAAP to distinguish between capital and operating leases. The principal difference from prior guidance is that the lease assets and lease liabilities arising from operating leases will be recognized on the Consolidated Balance Sheet. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company adopted the ASU in the first quarter of 2019, using the optional transition method that allows for a cumulative-effect adjustment in the period of adoption with no restatement of prior periods. The Company elected the package of practical expedients permitted under the transition guidance that allows for the carry forward of historical lease classifications and consistent treatment of initial direct costs for existing leases. The Company also elected to apply the practical expedient that allows the continued historical treatment of land easements. The Company did not elect the practical expedient for the use of hindsight in evaluating the expected lease term of existing leases. The adoption of the ASU resulted in the recording of operating lease assets and operating lease liabilities of approximately $453 million and $461 million , respectively, as of December 30, 2018. The difference between the additional lease assets and lease liabilities, represents existing deferred rent and prepaid lease balances that were reclassified on the balance sheet. The adoption of the ASU did not have a material impact to the Company’s Consolidated Statements of Income or Cash Flows. Accounting standards to be adopted in future periods Cloud Computing Arrangements . In August 2018, the FASB issued ASU 2018-15: Intangibles - Goodwill and Other - Internal-Use Software: Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract. The ASU allows companies to capitalize implementation costs incurred in a hosting arrangement that is a service contract over the term of the hosting arrangement, including periods covered by renewal options that are reasonably certain to be exercised. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019 and can be applied retrospectively or prospectively. Early adoption is permitted. The Company is currently assessing the impact of adoption. |
Sale of Accounts Receivable
Sale of Accounts Receivable | 6 Months Ended |
Jun. 29, 2019 | |
Transfers and Servicing of Financial Assets [Abstract] | |
Transfers and Servicing of Financial Assets [Text Block] | Sale of accounts receivable The Company has a program in which a discrete group of customers are allowed to extend their payment terms in exchange for the elimination of early payment discounts (Extended Terms Program). The Company has two Receivable Sales Agreements (Monetization Programs) described below, which are intended to directly offset the impact the Extended Terms Program would have on the days-sales-outstanding (DSO) metric that is critical to the effective management of the Company's accounts receivable balance and overall working capital. The Monetization Programs are designed to effectively offset the impact on working capital of the Extended Terms Program. The Monetization Programs sell, on a revolving basis, certain trade accounts receivable invoices to third party financial institutions. Transfers under these agreements are accounted for as sales of receivables resulting in the receivables being de-recognized from the Consolidated Balance Sheet. The Monetization Programs provide for the continuing sale of certain receivables on a revolving basis until terminated by either party; however the maximum receivables that may be sold at any time is $1,033 million . The Company has no retained interest in the receivables sold, however the Company does have collection and administrative responsibilities for the sold receivables. The Company has not recorded any servicing assets or liabilities as of June 29, 2019 and December 29, 2018 for these agreements as the fair value of these servicing arrangements as well as the fees earned were not material to the financial statements. Accounts receivable sold of $947 million and $900 million remained outstanding under these arrangements as of June 29, 2019 and December 29, 2018 , respectively. The proceeds from these sales of receivables are included in cash from operating activities in the Consolidated Statement of Cash Flows in the period of sale. The recorded net loss on sale of receivables was $7 million and $15 million for the quarter and year-to-date periods ended June 29, 2019 , respectively and was $6 million and $12 million for the quarter and year-to-date periods ended June 30, 2018 , respectively. The recorded loss is included in Other income and expense. Other programs Additionally, from time to time certain of the Company's foreign subsidiaries will transfer, without recourse, accounts receivable invoices of certain customers to financial institutions. These transactions are accounted for as sales of the receivables resulting in the receivables being de-recognized from the Consolidated Balance Sheet. Accounts receivable sold of $21 million and $93 million remained outstanding under these programs as of June 29, 2019 and December 29, 2018 |
Divestitures and held for sale
Divestitures and held for sale | 6 Months Ended |
Jun. 29, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] | Divestitures and held for sale On March 31, 2019, the Company entered into a definitive agreement to sell selected cookies, fruit and fruit-flavored snacks, pie crusts, and ice cream cones businesses to Ferrero International S.A. (Ferrero) for approximately $1.3 billion in cash, subject to a working capital adjustment mechanism. Both the total assets and net assets of the businesses, including a targeted working capital amount is estimated to be approximately $1.3 billion , and is expected to result in an immaterial pre-tax gain when recognized upon closing. The net assets and liabilities of these businesses were classified as held for sale during the second quarter of 2019. The following table presents the major classes of assets and liabilities classified as held for sale on the Consolidated Balance Sheet as of June 29, 2019: (millions) June 29, 2019 Inventory and other assets $ 112 Total current assets 112 Property and equipment 227 Goodwill and intangible assets 956 Operating lease right-of-use assets 5 Total noncurrent assets 1,188 Total assets $ 1,300 Current operating lease liabilities $ 1 Total current liabilities 1 Operating lease liabilities 4 Total liabilities $ 5 |
Acquisitions, West Africa Inves
Acquisitions, West Africa Investments, Goodwill and Other Intangible Assets | 6 Months Ended |
Jun. 29, 2019 | |
Acquisitions, West Africa Investments, Goodwill and Other Intangible Assets [Abstract] | |
Acquisitions, West Africa Investments, Goodwill and Other Intangible Assets | Acquisitions, West Africa investments, goodwill and other intangible assets Multipro acquisition On May 2, 2018, the Company (i) acquired an incremental 1% ownership interest in Multipro, a leading distributor of a variety of food products in Nigeria and Ghana, and (ii) exercised its call option (Purchase Option) to acquire a 50% interest in Tolaram Africa Foods, PTE LTD (TAF), a holding company with a 49% equity interest in an affiliated food manufacturer, resulting in the Company having a 24.5% interest in the affiliated food manufacturer. The aggregate cash consideration paid was approximately $419 million and was funded through cash on hand and short-term borrowings, which was refinanced with long-term borrowings in May 2018. As part of the consideration for the acquisition, an escrow established in connection with the original Multipro investment in 2015, which represented a significant portion of the amount paid for the Company’s initial investment, was released by the Company. As a result of the Company’s incremental ownership interest in Multipro and concurrent changes to the shareholders' agreement, the Company has a 51% controlling interest in and is consolidating Multipro. The acquisition was accounted for as a business combination and the assets and liabilities of Multipro were included in the June 29, 2019 and December 29, 2018 Consolidated Balance Sheet and the results of its operations have been included in the Consolidated Statement of Income subsequent to the acquisition date within the AMEA reporting segment. The Multipro investment was previously accounted for under the equity method of accounting and the Company recorded our share of equity income or loss from Multipro within Earnings (loss) from unconsolidated entities. In connection with the business combination, the Company recognized a one-time, non-cash gain in the second quarter of 2018 on the disposition of our previously held equity interest in Multipro of $245 million , which is included within Earnings (loss) from unconsolidated entities. The Company's June 30, 2018 quarter-to-date and year-to-date consolidated unaudited pro forma historical net sales and net income, as if Multipro had been acquired at the beginning of 2018, exclusive of the non-cash $245 million gain on the disposition of the equity interest recognized in the second quarter of 2018, are estimated as follows: Quarter ended Year-to-date period ended (millions) June 30, 2018 June 30, 2018 Net sales $ 3,433 $ 7,043 Net Income attributable to Kellogg Company $ 596 $ 1,040 Investment in TAF The investment in TAF, our interest in an affiliated food manufacturer, is accounted for under the equity method of accounting with the Company’s share of equity income or loss being recognized within Earnings (loss) from unconsolidated entities. The $458 million aggregate of the consideration paid upon exercise and the historical cost value of the Put Option was compared to the estimated fair value of the Company’s ownership percentage of TAF and the Company recognized a one-time, non-cash loss in the second quarter of 2018 of $45 million within Earnings (loss) from unconsolidated entities, which represents an other than temporary excess of cost over fair value of the investment. The difference between the carrying amount of TAF and the underlying equity in net assets is primarily attributable to brand and customer list intangible assets, a portion of which is being amortized over future periods, and goodwill. Goodwill and Intangible Assets Changes in the carrying amount of goodwill, intangible assets subject to amortization, consisting primarily of customer relationships, distribution agreements, and indefinite-lived intangible assets, consisting of brands, are presented in the following tables: Carrying amount of goodwill (millions) North America Europe Latin America AMEA Consoli- dated December 29, 2018 $ 4,611 $ 346 $ 218 $ 875 $ 6,050 Held for sale (191 ) — — — (191 ) Currency translation adjustment 2 1 2 7 12 June 29, 2019 $ 4,422 $ 347 $ 220 $ 882 $ 5,871 Intangible assets subject to amortization Gross carrying amount (millions) North America Europe Latin America AMEA Consoli- dated December 29, 2018 $ 74 $ 39 $ 63 $ 432 $ 608 Held for sale (12 ) — — — (12 ) Currency translation adjustment — (2 ) 1 3 2 June 29, 2019 $ 62 $ 37 $ 64 $ 435 $ 598 Accumulated Amortization December 29, 2018 $ 39 $ 18 $ 12 $ 18 $ 87 Amortization 2 1 2 9 14 Held for sale (12 ) — — — (12 ) Currency translation adjustment — (1 ) — — (1 ) June 29, 2019 $ 29 $ 18 $ 14 $ 27 $ 88 Intangible assets subject to amortization, net December 29, 2018 $ 35 $ 21 $ 51 $ 414 $ 521 Amortization (2 ) (1 ) (2 ) (9 ) (14 ) Currency translation adjustment — (1 ) 1 3 3 June 29, 2019 $ 33 $ 19 $ 50 $ 408 $ 510 For intangible assets in the preceding table, amortization was $14 million and $9 million for the year-to-date periods ended June 29, 2019 and June 30, 2018 , respectively. The currently estimated aggregate annual amortization expense for full-year 2019 is approximately $27 million . Intangible assets not subject to amortization (millions) North America Europe Latin America AMEA Consoli- dated December 29, 2018 $ 1,985 $ 401 $ 73 $ 381 $ 2,840 Held for sale (765 ) — — — (765 ) Currency translation adjustment — (2 ) 1 3 2 June 29, 2019 $ 1,220 $ 399 $ 74 $ 384 $ 2,077 Impairment Testing Goodwill is tested for impairment at least annually or whenever events or changes in circumstances indicate the carrying value of the asset may be impaired, including a change in reporting units or composition of reporting units as a result of a re-organization in internal reporting structures. For the goodwill impairment test, the fair value of the reporting units are estimated based on market multiples. This approach employs market multiples based on either sales or earnings before interest, taxes, depreciation and amortization for companies that are comparable to the Company’s reporting units. In the event the fair value determined using the market multiple approach is close to carrying value, the Company may supplement the fair value determination using discounted cash flows. The assumptions used for the impairment test are consistent with those utilized by a market participant performing similar valuations for the Company’s reporting units. These estimates are made using various inputs including historical data, current and anticipated market conditions, management plans, and market comparables. On December 30, 2018 the Company reorganized our North American business. The reorganization eliminated the legacy business unit structure and internal reporting. In addition, the Company changed the internal reporting provided to the chief operating decision maker (CODM) and segment manager. As a result, the Company reevaluated its operating segments and reporting units. In addition, we transferred the management of our Middle East, North Africa, and Turkey businesses from Kellogg Europe to Kellogg AMEA, effective December 30, 2018. Refer to Note 12, Reportable Segments for further details on these changes. As a result of these changes in operating segments and related reporting units, the Company re-allocated goodwill between reporting units where necessary and compared the carrying value to the fair value of each impacted reporting unit on a before and after basis. This evaluation was only required to be performed on reporting units impacted by the changes noted above. Effective December 30, 2018 in North America, the previous U.S. Snacks, U.S. Morning Foods, U.S. Specialty Channels, U.S. Frozen Foods, Kashi, Canada and RX operating segments are now a single operating segment (Kellogg North America). At the beginning of 2019, the Company evaluated the related impacted reporting units for impairment on a before and after basis and concluded that the fair values of each reporting unit exceeded their carrying values. On a before basis, the previous Kashi reporting unit's percentage of excess of fair value over carrying value was approximately 18% using the same methodology as the 2018 annual impairment analysis, which was performed as of the beginning of the fourth quarter of 2018. The fair value of the previous Kashi reporting unit was estimated primarily based on a multiple of net sales and discounted cash flows. Approximately $46 million of goodwill was re-allocated between the impacted reporting units within Kellogg Europe and Kellogg AMEA related to the transfer of businesses between these operating segments. The Company performed a goodwill evaluation of the impacted reporting units on a before and after basis and concluded that the fair value of the impacted reporting units exceeded their carrying values. Additionally, during the first quarter of 2019, the Company determined that it was more likely than not that the Company would be selling its selected cookies, fruit and fruit-flavored snacks, pie crusts, and ice cream cones businesses within the North America reporting unit. As a result, the Company performed a goodwill impairment evaluation on the North America reporting unit in the first quarter of 2019 and concluded that the fair value exceeded the carrying value of the reporting unit. During the second quarter of 2019, the Company entered into a definitive agreement to sell the businesses to Ferrero. In connection with the execution of the definitive agreement, the net assets and liabilities of these businesses, included in the North America reporting unit, were classified as held for sale including $191 million of Goodwill and $765 million |
Restructuring and Cost Reductio
Restructuring and Cost Reduction Activities | 6 Months Ended |
Jun. 29, 2019 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Cost Reduction Activities | Restructuring Programs The Company views its restructuring programs as part of its operating principles to provide greater visibility in achieving its long-term profit growth targets. Initiatives undertaken are currently expected to recover cash implementation costs within a 3 to 5 -year period of completion. Upon completion (or as each major stage is completed in the case of multi-year programs), the project begins to deliver cash savings and/or reduced depreciation. Project K Since inception, Project K has reduced the Company’s cost structure, and is expected to provide enduring benefits, including an optimized supply chain infrastructure, an efficient global business services model, a global focus on categories, increased agility from a more efficient organization design, and improved effectiveness in go-to-market models. These benefits are intended to strengthen existing businesses in core markets, increase growth in developing and emerging markets, and drive an increased level of value-added innovation. The Company approved all remaining Project K initiatives as of the end of 2018 and implementation of these remaining initiatives will be completed in 2019. Project charges, after-tax costs and annual savings remain in line with expectations. The Company currently anticipates that the program will result in total pre-tax charges, once all phases are implemented, of $1.6 billion , with after-tax cash costs, including incremental capital investments, estimated to be approximately $1.2 billion . Based on current estimates and actual charges to date, the Company expects the total project charges will consist of asset-related costs of approximately $500 million which will consist primarily of asset impairments, accelerated depreciation and other exit-related costs; employee-related costs of approximately $400 million which includes severance, pension and other termination benefits; and other costs of approximately $700 million which consists primarily of charges related to the design and implementation of global business capabilities and a more efficient go-to-market model. The Company currently expects that total pre-tax charges related to Project K will impact reportable segments as follows: North America (approximately 65% ), Europe (approximately 22% ), Latin America (approximately 3% ), AMEA (approximately 6% ), and Corporate (approximately 4% ). During the quarter and year-to-date period ended June 29, 2019 , the Company recorded total net charges of $15 million and $23 million , respectively related to Project K. During the quarter and year-to-date period ended June 30, 2018 , the Company recorded total net charges of $5 million and $25 million , respectively related to Project K. Since the inception of Project K, the Company has recognized charges of $1,543 million that have been attributed to the program. The charges consist of $6 million recorded as a reduction of revenue, $910 million recorded in cost of goods sold (COGS), $794 million recorded in selling, general and administrative (SG&A) expense, and $(167) million recorded in OIE. Other Programs During the second quarter of 2019, the Company announced a reorganization plan for the European reportable segment designed to simplify the organization, increase organizational efficiency, and enhance key processes. The overall project is expected to be substantially completed by December 31, 2020. The project is expected to result in cumulative pretax net charges of approximately $50 million , including certain non-cash credits. Cash costs are expected to be approximately $57 million . The total expected charges will include severance and other termination benefits and charges related to relocation, third party legal and consulting fees, and contract termination costs. During the quarter ended June 29, 2019 , the Company recorded total charges of $32 million related to this initiative. The charges were recorded in SG&A expense. Additionally during the second quarter of 2019, the Company announced a reorganization plan which primarily impacts the North America reportable segment. The reorganization plan is designed to simplify the organization that supports the remaining North America reportable segment after the divestiture and related transition. The overall project is expected to be substantially completed by December 31, 2020. The overall project is expected to result in cumulative pretax charges of approximately $35 million . Cash costs are expected to approximate the pretax charges. Total expected charges will include severance and other termination benefits and charges related to third party consulting fees. During the quarter ended June 29, 2019 , the Company recorded total charges of $18 million related to this initiative. The charges were recorded in SG&A expense. All Programs During the quarter ended June 29, 2019 , the Company recorded total net charges of $65 million across all restructuring programs. The charges were comprised of $11 million of expense recorded in COGS, $54 million of expense recorded in SG&A expense. During the year-to-date period ended June 29, 2019 , the Company recorded total charges of $73 million across all restructuring programs. The charges were comprised of $17 million recorded in COGS and $56 million recorded in SG&A expense. During the quarter ended June 30, 2018 , the Company recorded total net charges of $5 million across all restructuring programs. The charges were comprised of $(4) million net gain recorded in COGS, $9 million recorded in SG&A expense. During the year-to-date period ended June 30, 2018, the Company recorded total charges of $25 million across all restructuring programs. The charges were comprised of $9 million recorded in COGS and $16 million recorded in SG&A expense. The tables below provide the details for charges incurred during the quarters ended June 29, 2019 and June 30, 2018 and program costs to date for all programs currently active as of June 29, 2019 . Quarter ended Year-to-date period ended Program costs to date (millions) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 June 29, 2019 Employee related costs $ 45 $ 1 $ 42 $ 5 $ 639 Pension curtailment (gain) loss, net — — — — (167 ) Asset related costs 7 (14 ) 10 (10 ) 295 Asset impairment — — — — 169 Other costs 13 18 21 30 657 Total $ 65 $ 5 $ 73 $ 25 $ 1,593 Quarter ended Year-to-date period ended Program costs to date (millions) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 June 29, 2019 North America $ 28 $ 12 $ 32 $ 22 $ 1,054 Europe 33 (13 ) 34 (6 ) 367 Latin America 2 2 4 4 46 AMEA 2 3 3 3 101 Corporate — 1 — 2 25 Total $ 65 $ 5 $ 73 $ 25 $ 1,593 Employee related costs consist primarily of severance and related benefits. Pension curtailment (gain) loss consists of curtailment gains or losses that resulted from project initiatives. Asset related costs consist primarily of accelerated depreciation. Asset impairments were recorded for fixed assets that were determined to be impaired and were written down to their estimated fair value. Other costs consist of third-party incremental costs related to the development and implementation of enhanced global structures and capabilities. At June 29, 2019 total project reserves were $104 million , related to severance payments and other costs of which a substantial portion will be paid in 2019. The following table provides details for exit cost reserves. Employee Related Costs Pension curtailment (gain) loss, net Asset Impairment Asset Related Costs Other Costs Total Liability as of December 29, 2018 $ 93 $ — $ — $ 1 $ 10 $ 104 2019 restructuring charges 42 — — 10 21 73 Cash payments (35 ) — — (5 ) (29 ) (69 ) Non-cash charges and other — — — (4 ) — (4 ) Liability as of June 29, 2019 $ 100 $ — $ — $ 2 $ 2 $ 104 |
Equity
Equity | 6 Months Ended |
Jun. 29, 2019 | |
Equity [Abstract] | |
Equity | Equity Earnings per share Basic earnings per share is determined by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share is similarly determined, except that the denominator is increased to include the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued. Dilutive potential common shares consist principally of employee stock options issued by the Company, restricted stock units, and to a lesser extent, certain contingently issuable performance shares. There were 15 million and 14 million anti-dilutive potential common shares excluded from the reconciliation for the quarter and year-to-date periods ended June 29, 2019 . There were 9 million and 6 million anti-dilutive potential common shares excluded from the reconciliation for the quarter and year-to-date periods ended June 30, 2018 . Please refer to the Consolidated Statement of Income for basic and diluted earnings per share for the quarters ended June 29, 2019 and June 30, 2018 . Share repurchases In December 2017, the board of directors approved a new authorization to repurchase up to $1.5 billion of our common stock beginning in January 2018 through December 2019. As of June 29, 2019 , $960 million remains available under the authorization. During the year-to-date period ended June 29, 2019 , the Company repurchased approximately 4 million shares of common stock for a total of $220 million . During the year-to-date period ended June 30, 2018 , the Company repurchased less than 1 million shares of common stock for a total of $50 million . Comprehensive income Comprehensive income includes net income and all other changes in equity during a period except those resulting from investments by or distributions to shareholders. Other comprehensive income consists of foreign currency translation adjustments, fair value adjustments associated with cash flow hedges and adjustments for net experience losses and prior service cost related to employee benefit plans, net of related tax effects. Reclassifications out of AOCI for the quarter and year-to-date periods ended June 29, 2019 and June 30, 2018 , consisted of the following: (millions) Details about AOCI components Amount reclassified from AOCI Line item impacted within Income Statement Quarter ended June 29, 2019 Year-to-date period ended June 29, 2019 (Gains) losses on cash flow hedges: Interest rate contracts $ 2 $ 3 Interest expense $ 2 $ 3 Total before tax (1 ) (1 ) Tax expense (benefit) $ 1 $ 2 Net of tax Amortization of postretirement and postemployment benefits: Net experience (gain) loss $ (1 ) $ (2 ) OIE $ (1 ) $ (2 ) Total before tax 1 1 Tax expense (benefit) $ — $ (1 ) Net of tax Total reclassifications $ 1 $ 1 Net of tax (millions) Details about AOCI components Amount reclassified from AOCI Line item impacted within Income Statement Quarter ended June 30, 2018 Year-to-date period ended June 30, 2018 (Gains) losses on cash flow hedges: Interest rate contracts $ 2 $ 4 Interest expense $ 2 $ 4 Total before tax (1 ) (1 ) Tax expense (benefit) $ 1 $ 3 Net of tax Amortization of postretirement and postemployment benefits: Net experience loss $ (1 ) $ (2 ) See Note 8 for further details $ (1 ) $ (2 ) Total before tax — — Tax expense (benefit) $ (1 ) $ (2 ) Net of tax Total reclassifications $ — $ 1 Net of tax Accumulated other comprehensive income (loss), net of tax, as of June 29, 2019 and December 29, 2018 consisted of the following: (millions) June 29, December 29, Foreign currency translation adjustments $ (1,431 ) $ (1,467 ) Cash flow hedges — unrealized net gain (loss) (65 ) (53 ) Postretirement and postemployment benefits: Net experience gain (loss) 21 23 Prior service credit (cost) 3 (3 ) Available-for-sale securities unrealized net gain (loss) 3 — Total accumulated other comprehensive income (loss) $ (1,469 ) $ (1,500 ) |
Leases
Leases | 6 Months Ended |
Jun. 29, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company leases certain warehouses, equipment, vehicles, and office space primarily through operating lease agreements. Finance lease obligations and activity are not material to the Consolidated Financial Statements. Lease obligations are primarily for real estate assets, with the remainder related to manufacturing and distribution related equipment, vehicles, information technology equipment, and rail cars. Leases with an initial term of 12 months or less are not recorded on the balance sheet. A portion of the Company's real estate leases include future variable rental payments that include inflationary adjustment factors. The future variability of these adjustments is unknown and therefore not included in the minimum lease payments. The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants. The leases have remaining terms which range from less than 1 year to 10 years and the majority of leases provide the Company with the option to exercise one or more renewal terms. The length of the lease term used in recording lease assets and lease liabilities is based on the contractually required lease term adjusted for any options to renew or early terminate the lease that are reasonably certain of being executed. The Company combines lease and non-lease components together in determining the minimum lease payments for the majority of leases. The Company has elected to not combine lease and non-lease components for certain asset types in service-related agreements that include significant production related costs. The Company has closely analyzed these agreements to ensure any embedded costs related to the securing of the leased asset is properly segregated and accounted for in measuring the lease assets and liabilities. The majority of the leases do not include a stated interest rate, and therefore the Company's periodic incremental borrowing rate is used to determine the present value of lease payments. This rate is calculated based on a collateralized rate for the specific currencies used in leasing activities and the borrowing ability of the applicable Company legal entity. For the initial implementation of the lease standard, the incremental borrowing rate at December 29, 2018 was used to present value operating lease assets and liabilities. The Company recorded operating lease costs of $32 million and $64 million for the quarter and year-to-date periods ended June 29, 2019. Lease related costs associated with variable rent, short-term leases, and sale-leaseback arrangements, as well as sublease income, are each immaterial. (millions) Quarter ended June 29, 2019 Year-to-date period ended June 29, 2019 Other information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 32 $ 63 Right-of-use assets obtained in exchange for new operating lease liabilities $ 8 $ 20 Weighted-average remaining lease term - operating leases 6 years Weighted-average discount rate - operating leases 3.1% At June 29, 2019, future maturities of operating leases were as follows: (millions) Operating leases 2019 (six months remaining) 65 2020 99 2021 75 2022 59 2023 47 2024 and beyond 124 Total minimum payments $ 469 Less interest $ (40 ) Less leases accounted for as held for sale $ (5 ) Present value of lease liabilities $ 424 Operating lease payments presented in the table above exclude $144 million of minimum lease payments for real-estate leases signed but not yet commenced. The leases are expected to commence in 2019 and 2020. As previously disclosed in our 2018 Annual Report on Form 10-K and under previous lease standard (Topic 840), at December 29, 2018, future minimum annual lease commitments under non-cancelable operating leases were as follows: (millions) Operating leases 2019 121 2020 97 2021 73 2022 57 2023 48 2024 and beyond 129 Total minimum payments $ 525 Rent expense on operating leases for the year ended December 29, 2018 was $133 million . |
Debt
Debt | 6 Months Ended |
Jun. 29, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Debt The following table presents the components of notes payable at June 29, 2019 and December 29, 2018 : June 29, 2019 December 29, 2018 (millions) Principal amount Effective interest rate Principal amount Effective interest rate (a) U.S. commercial paper $ 355 2.55 % $ 15 2.75 % Bank borrowings 213 161 Total $ 568 $ 176 |
Stock Compensation
Stock Compensation | 6 Months Ended |
Jun. 29, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Compensation | Stock compensation The Company uses various equity-based compensation programs to provide long-term performance incentives for its global workforce. Currently, these incentives consist principally of stock options, restricted stock units, and to a lesser extent, executive performance shares and restricted stock grants. The Company also sponsors a discounted stock purchase plan in the United States and matching-grant programs in several international locations. Additionally, the Company awards restricted stock to its outside directors. The interim information below should be read in conjunction with the disclosures included within the stock compensation footnote of the Company’s 2018 Annual Report on Form 10-K. The Company classifies pre-tax stock compensation expense in COGS and SG&A expense principally within its Corporate segment. For the periods presented, compensation expense for all types of equity-based programs and the related income tax benefit recognized was as follows: Quarter ended Year-to-date period ended (millions) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 Pre-tax compensation expense $ 18 $ 16 $ 32 $ 33 Related income tax benefit $ 5 $ 4 $ 8 $ 8 During the year-to-date period ended June 29, 2019 , the Company granted approximately 0.9 million restricted stock units at a weighted average cost of $56 per share and 2.8 million non-qualified stock options at a weighted average cost of $7 per share. Terms of these grants and the Company’s methods for determining grant-date fair value of the awards were consistent with that described within the stock compensation footnote in the Company’s 2018 Annual Report on Form 10-K. Performance shares In the first quarter of 2019, the Company granted performance shares to a limited number of senior executive-level employees, which entitle these employees to receive a specified number of shares of the Company’s common stock upon vesting. The number of shares earned could range between 0% and 200% of the target amount depending upon performance achieved over the three year vesting period. The performance conditions of the award include organic net sales growth and total shareholder return (TSR) of the Company’s common stock relative to a select group of peer companies. A Monte Carlo valuation model was used to determine the fair value of the awards. The TSR performance metric is a market condition. Therefore, compensation cost of the TSR condition is fixed at the measurement date and is not revised based on actual performance. The TSR metric was valued as a multiplier of possible levels of organic net sales growth achievement. Compensation cost related to organic net sales growth performance is revised for changes in the expected outcome. The 2019 target grant currently corresponds to approximately 239,000 shares, with a grant-date fair value of $59 per share. The 2016 performance share award, payable in stock, was settled at 85% of target in February 2019 for a total dollar equivalent of $6 million . |
Employee Benefits
Employee Benefits | 6 Months Ended |
Jun. 29, 2019 | |
Retirement Benefits [Abstract] | |
Employee Benefits | Employee benefits The Company sponsors a number of U.S. and foreign pension plans as well as other nonpension postretirement and postemployment plans to provide various benefits for its employees. These plans are described within the footnotes to the Consolidated Financial Statements included in the Company’s 2018 Annual Report on Form 10-K. Components of Company plan benefit expense for the periods presented are included in the tables below. Pension Quarter ended Year-to-date period ended (millions) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 Service cost $ 9 $ 22 $ 18 $ 44 Interest cost 44 41 89 83 Expected return on plan assets (83 ) (90 ) (168 ) (182 ) Amortization of unrecognized prior service cost 2 2 4 4 Recognized net (gain) loss 10 (2 ) 11 (11 ) Net periodic benefit cost $ (18 ) $ (27 ) $ (46 ) $ (62 ) Other nonpension postretirement Quarter ended Year-to-date period ended (millions) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 Service cost $ 4 $ 4 $ 7 $ 9 Interest cost 10 9 20 18 Expected return on plan assets (21 ) (23 ) (42 ) (47 ) Amortization of unrecognized prior service (gain) (2 ) (2 ) (4 ) (4 ) Total postretirement benefit (income) expense $ (9 ) $ (12 ) $ (19 ) $ (24 ) Postemployment Quarter ended Year-to-date period ended (millions) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 Service cost $ 1 $ 1 $ 2 $ 2 Interest cost 1 — 1 — Recognized net (gain) loss (1 ) (1 ) (2 ) (2 ) Total postemployment benefit expense $ 1 $ — $ 1 $ — For the year-to-date period ended June 29, 2019 , the Company recognized a loss of $11 million related to the remeasurement of a U.S. pension plan as current year distributions are expected to exceed service and interest costs resulting in settlement accounting for that particular plan. The amount of the remeasurement loss recognized was due primarily to an unfavorable change in the discount rate. Company contributions to employee benefit plans are summarized as follows: (millions) Pension Nonpension postretirement Total Quarter ended: June 29, 2019 $ 3 $ 4 $ 7 June 30, 2018 $ 251 $ 4 $ 255 Year-to-date period ended: June 29, 2019 $ 4 $ 8 $ 12 June 30, 2018 $ 266 $ 8 $ 274 Full year: Fiscal year 2019 (projected) $ 7 $ 18 $ 25 Fiscal year 2018 (actual) $ 270 $ 17 $ 287 Prior year contributions included $250 million of pre-tax discretionary contributions to U.S. plans in the second quarter of 2018 designated for the 2017 tax year. Plan funding strategies may be modified in response to management's evaluation of tax deductibility, market conditions, and competing investment alternatives. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 29, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income taxes The consolidated effective tax rate for the quarter ended June 29, 2019 was 20% as compared to 15% in the same quarter of the prior year. The effective tax rate for the second quarter of 2018 benefited $31 million due to discretionary pension contributions made in the second quarter of 2018 totaling $250 million , which were designated as 2017 tax year contributions. The consolidated effective tax rate for the year-to-date periods ended June 29, 2019 and June 30, 2018 was 20% and 14% , respectively. The effective tax rate for the year-to-date period ended June 30, 2018 benefited from a discretionary pension contribution and a $44 million discrete tax benefit as a result of the remeasurement of deferred taxes following a legal entity restructuring. As of June 29, 2019 , the Company classified $10 million of unrecognized tax benefits as a net current liability. Management’s estimate of reasonably possible changes in unrecognized tax benefits during the next twelve months consists of the current liability balance expected to be settled within one year, offset by approximately $2 million of projected additions related primarily to ongoing intercompany transfer pricing activity. Management is currently unaware of any issues under review that could result in significant additional payments, accruals or other material deviation in this estimate. The Company’s total gross unrecognized tax benefits as of June 29, 2019 was $97 million , unchanged from year-end. Of this balance, $87 million represents the amount that, if recognized, would affect the Company’s effective income tax rate in future periods. The accrual balance for tax-related interest was approximately $22 million at June 29, 2019 . |
Derivative Instruments and Fair
Derivative Instruments and Fair Value Measurements | 6 Months Ended |
Jun. 29, 2019 | |
Derivative Instruments and Fair Value Measurements [Abstract] | |
Derivative Instruments and Fair Value Measurements | Derivative instruments and fair value measurements The Company is exposed to certain market risks such as changes in interest rates, foreign currency exchange rates, and commodity prices, which exist as a part of its ongoing business operations. Management uses derivative and nonderivative financial instruments and commodity instruments, including futures, options, and swaps, where appropriate, to manage these risks. Instruments used as hedges must be effective at reducing the risk associated with the exposure being hedged. The Company designates derivatives and nonderivative hedging instruments as cash flow hedges, fair value hedges, net investment hedges, and uses other contracts to reduce volatility in interest rates, foreign currency and commodities. As a matter of policy, the Company does not engage in trading or speculative hedging transactions. Total notional amounts of the Company’s derivative instruments as of June 29, 2019 and December 29, 2018 were as follows: (millions) June 29, December 29, Foreign currency exchange contracts $ 1,623 $ 1,863 Cross-currency contracts 1,363 1,197 Interest rate contracts 1,507 1,608 Commodity contracts 322 417 Total $ 4,815 $ 5,085 Following is a description of each category in the fair value hierarchy and the financial assets and liabilities of the Company that were included in each category at June 29, 2019 and December 29, 2018 , measured on a recurring basis. Level 1 – Financial assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market. For the Company, level 1 financial assets and liabilities consist primarily of commodity derivative contracts. Level 2 – Financial assets and liabilities whose values are based on quoted prices in markets that are not active or model inputs that are observable either directly or indirectly for substantially the full term of the asset or liability. For the Company, level 2 financial assets and liabilities consist of interest rate swaps, cross-currency swaps and over-the-counter commodity and currency contracts. The Company’s calculation of the fair value of interest rate swaps is derived from a discounted cash flow analysis based on the terms of the contract and the interest rate curve. Over-the-counter commodity derivatives are valued using an income approach based on the commodity index prices less the contract rate multiplied by the notional amount. Foreign currency contracts are valued using an income approach based on forward rates less the contract rate multiplied by the notional amount. Cross-currency contracts are valued based on changes in the spot rate at the time of valuation compared to the spot rate at the time of execution, as well as the change in the interest differential between the two currencies. The Company’s calculation of the fair value of level 2 financial assets and liabilities takes into consideration the risk of nonperformance, including counterparty credit risk. Level 3 – Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect management’s own assumptions about the assumptions a market participant would use in pricing the asset or liability. The Company did not have any level 3 financial assets or liabilities as of June 29, 2019 or December 29, 2018 . The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheet on a recurring basis as of June 29, 2019 and December 29, 2018 : Derivatives designated as hedging instruments June 29, 2019 December 29, 2018 (millions) Level 1 Level 2 Total Level 1 Level 2 Total Assets: Cross-currency contracts: Other assets $ — $ 95 $ 95 $ — $ 79 $ 79 Interest rate contracts: Other assets (a) — 6 6 — 17 17 Total assets $ — $ 101 $ 101 $ — $ 96 $ 96 Liabilities: Interest rate contracts: Other liabilities (a) — — — — (22 ) (22 ) Total liabilities $ — $ — $ — $ — $ (22 ) $ (22 ) (a) The fair value of the related hedged portion of the Company's long-term debt, a level 2 liability, was $0.7 billion and $1.6 billion as of June 29, 2019 and December 29, 2018 , respectively. Derivatives not designated as hedging instruments June 29, 2019 December 29, 2018 (millions) Level 1 Level 2 Total Level 1 Level 2 Total Assets: Foreign currency exchange contracts: Other current assets $ — $ 10 $ 10 $ — $ 3 $ 3 Commodity contracts: Other current assets 3 — 3 3 — 3 Total assets $ 3 $ 10 $ 13 $ 3 $ 3 $ 6 Liabilities: Foreign currency exchange contracts: Other current liabilities $ — $ (10 ) $ (10 ) $ — $ (4 ) $ (4 ) Other liabilities — (1 ) (1 ) — — — Interest rate contracts: Other liabilities — (14 ) (14 ) — — — Commodity contracts: Other current liabilities (8 ) — (8 ) (9 ) — (9 ) Total liabilities $ (8 ) $ (25 ) $ (33 ) $ (9 ) $ (4 ) $ (13 ) The Company has designated its outstanding foreign currency denominated long-term debt as a net investment hedge of a portion of the Company’s investment in its subsidiaries’ foreign currency denominated net assets. The carrying value of this debt was approximately $2.6 billion as of June 29, 2019 and December 29, 2018 . The following amounts were recorded on the Consolidated Balance Sheet related to cumulative basis adjustments for existing fair value hedges as of June 29, 2019 and December 29, 2018 . (millions) Line Item in the Consolidated Balance Sheet in which the hedged item is included Carrying amount of the hedged liabilities Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged liabilities (a) June 29, December 29, June 29, December 29, Interest rate contracts Current maturities of long-term debt $ 501 $ 503 $ 1 $ 3 Interest rate contracts Long-term debt $ 3,388 $ 3,354 $ 22 $ (18 ) (a) The current maturities of hedged long-term debt includes $1 million and $3 million of hedging adjustment on discontinued hedging relationships as of June 29, 2019 and December 29, 2018 , respectively. The hedged long-term debt includes $16 million and $(12) million of hedging adjustment on discontinued hedging relationships as of June 29, 2019 and December 29, 2018 , respectively. The Company has elected to not offset the fair values of derivative assets and liabilities executed with the same counterparty that are generally subject to enforceable netting agreements. However, if the Company were to offset and record the asset and liability balances of derivatives on a net basis, the amounts presented in the Consolidated Balance Sheet as of June 29, 2019 and December 29, 2018 would be adjusted as detailed in the following table: As of June 29, 2019: Gross Amounts Not Offset in the Consolidated Balance Sheet Amounts Presented in the Consolidated Balance Sheet Financial Instruments Cash Collateral Received/ Posted Net Amount Total asset derivatives $ 114 $ (25 ) $ (7 ) $ 82 Total liability derivatives $ (33 ) $ 25 $ — $ (8 ) As of December 29, 2018: Gross Amounts Not Offset in the Consolidated Balance Sheet Amounts Presented in the Consolidated Balance Sheet Financial Instruments Cash Collateral Received/ Posted Net Amount Total asset derivatives $ 102 $ (27 ) $ (2 ) $ 73 Total liability derivatives $ (35 ) $ 27 $ — $ (8 ) The effect of derivative instruments on the Consolidated Statements of Income and Comprehensive Income for the quarters ended June 29, 2019 and June 30, 2018 was as follows: Derivatives and non-derivatives in net investment hedging relationships (millions) Gain (loss) recognized in AOCI Gain (loss) excluded from assessment of hedge effectiveness Location of gain (loss) in income of excluded component June 29, June 30, June 29, June 30, Foreign currency denominated long-term debt $ (35 ) $ 146 $ — $ — Cross-currency contracts 23 35 8 3 Interest expense Total $ (12 ) $ 181 $ 8 $ 3 Derivatives not designated as hedging instruments (millions) Location of gain (loss) recognized in income Gain (loss) recognized in income June 29, June 30, Foreign currency exchange contracts COGS $ 1 $ 4 Commodity contracts COGS 40 (8 ) Total $ 41 $ (4 ) The effect of derivative instruments on the Consolidated Statements of Income and Comprehensive Income for the year-to-date periods ended June 29, 2019 and June 30, 2018 was as follows: Derivatives and non-derivatives in net investment hedging relationships (millions) Gain (loss) recognized in AOCI Gain (loss) excluded from assessment of hedge effectiveness Location of gain (loss) in income of excluded component June 29, June 30, June 29, June 30, Foreign currency denominated long-term debt $ 16 $ 73 $ — $ — Cross-currency contracts 15 27 16 6 Other income (expense), net Total $ 31 $ 100 $ 16 $ 6 Derivatives not designated as hedging instruments (millions) Location of gain (loss) recognized in income Gain (loss) recognized in income June 29, June 30, Foreign currency exchange contracts COGS $ (10 ) $ 7 Foreign currency exchange contracts Other income (expense), net (1 ) (4 ) Foreign currency exchange contracts SGA — 1 Commodity contracts COGS 8 (3 ) Total $ (3 ) $ 1 The effect of fair value and cash flow hedge accounting on the Consolidated Income Statement for the quarters ended June 29, 2019 and June 30, 2018 : June 29, 2019 June 30, 2018 (millions) Interest Expense Interest Expense Total amounts of income and expense line items presented in the Consolidated Income Statement in which the effects of fair value or cash flow hedges are recorded $ 75 $ 72 Gain (loss) on fair value hedging relationships: Interest contracts: Hedged items (13 ) (7 ) Derivatives designated as hedging instruments 13 7 Gain (loss) on cash flow hedging relationships: Interest contracts: Amount of gain (loss) reclassified from AOCI into income (2 ) (2 ) The effect of fair value and cash flow hedge accounting on the Consolidated Income Statement for the year-to-date periods ended June 29, 2019 and June 30, 2018 : June 29, 2019 June 30, 2018 (millions) Interest Expense Interest Expense Total amounts of income and expense line items presented in the Consolidated Income Statement in which the effects of fair value or cash flow hedges are recorded $ 149 $ 141 Gain (loss) on fair value hedging relationships: Interest contracts: Hedged items (37 ) 25 Derivatives designated as hedging instruments 37 (21 ) Gain (loss) on cash flow hedging relationships: Interest contracts: Amount of gain (loss) reclassified from AOCI into income (3 ) (4 ) During the next 12 months, the Company expects $5 million of net deferred losses reported in AOCI at June 29, 2019 to be reclassified to income, assuming market rates remain constant through contract maturities. Certain of the Company’s derivative instruments contain provisions requiring the Company to post collateral on those derivative instruments that are in a liability position if the Company’s credit rating is at or below BB+ (S&P), or Baa1 (Moody’s). The fair value of all derivative instruments with credit-risk-related contingent features in a liability position on June 29, 2019 was not material. In addition, certain derivative instruments contain provisions that would be triggered in the event the Company defaults on its debt agreements. There were no collateral posting as of June 29, 2019 triggered by credit-risk-related contingent features. Other fair value measurements The following is a summary of the carrying and market values of the Company's available for sale securities: June 29, 2019 December 29, 2018 Unrealized Unrealized (millions) Cost Gain (Loss) Market Value Cost Gain (Loss) Market Value Corporate bonds $ 60 $ 3 $ 63 $ 59 $ — $ 59 The market values of the Company's investments in level 2 corporate bonds are based on matrices or models from pricing vendors. Unrealized gains and losses are included in the Consolidated Statement of Comprehensive Income. The Company reviews its investment portfolio for any unrealized losses that would be deemed other-than-temporary and requires the recognition of an impairment loss in earnings. If the cost of an investment exceeds its fair value, the Company evaluates, among other factors, general market conditions, the duration and extent to which the fair value is less than its cost, the Company's intent to hold the investment, and whether it is more likely than not that the Company will be required to sell the investment before recovery of the cost basis. The Company also considers the type of security, related industry and sector performance, and published investment ratings. Once a decline in fair value is determined to be other-than-temporary, an impairment charge is recorded and a new cost basis in the investment is established. If conditions within individual markets, industry segments, or macro-economic environments deteriorate, the Company could incur future impairments. The investments are recorded within Other current assets and Other assets on the Consolidated Balance Sheet, based on the maturity of the individual security. The maturity dates of the securities range from 2020 to 2028. Financial instruments The carrying values of the Company’s short-term items, including cash, cash equivalents, accounts receivable, accounts payable, notes payable and current maturities of long-term debt approximate fair value. The fair value of the Company’s long-term debt, which are level 2 liabilities, is calculated based on broker quotes. The fair value and carrying value of the Company's long-term debt was $8.7 billion and $8.3 billion , respectively, as of June 29, 2019 . The fair value and carrying value of the Company's long-term debt were both $8.2 billion as of December 29, 2018. Counterparty credit risk concentration and collateral requirements The Company is exposed to credit loss in the event of nonperformance by counterparties on derivative financial and commodity contracts. Management believes a concentration of credit risk with respect to derivative counterparties is limited due to the credit ratings and use of master netting and reciprocal collateralization agreements with the counterparties and the use of exchange-traded commodity contracts. Master netting agreements apply in situations where the Company executes multiple contracts with the same counterparty. Certain counterparties represent a concentration of credit risk to the Company. If those counterparties fail to perform according to the terms of derivative contracts, this would result in a loss to the Company. As of June 29, 2019 , the Company was not in a material net asset position with any counterparties with which a master netting agreement would apply. For certain derivative contracts, reciprocal collateralization agreements with counterparties call for the posting of collateral in the form of cash, treasury securities or letters of credit if a fair value loss position to the Company or its counterparties exceeds a certain amount. In addition, the Company is required to maintain cash margin accounts in connection with its open positions for exchange-traded commodity derivative instruments executed with the counterparty that are subject to enforceable netting agreements. As of June 29, 2019 , the Company had no collateral posting requirements related to reciprocal collateralization agreements and collected approximately $19 million of collateral related to reciprocal collaterization agreements which is reflected as an increase in other liabilities. As of June 29, 2019 the Company posted $12 million in margin deposits for exchange-traded commodity derivative instruments, which was reflected as an increase in accounts receivable, net on the Consolidated Balance Sheet. Management believes concentrations of credit risk with respect to accounts receivable is limited due to the generally high credit quality of the Company’s major customers, as well as the large number and geographic dispersion of smaller customers. However, the Company conducts a disproportionate amount of business with a small number of large multinational grocery retailers, with the five largest accounts encompassing approximately 20% of consolidated trade receivables at June 29, 2019 . |
Reportable Segments
Reportable Segments | 6 Months Ended |
Jun. 29, 2019 | |
Segment Reporting [Abstract] | |
Reportable Segments | Reportable segments Kellogg Company is the world’s leading producer of cereal, second largest producer of crackers, and a leading producer of savory snacks and frozen foods. Additional product offerings include toaster pastries, cereal bars, cookies, veggie foods and noodles. Kellogg products are manufactured and marketed globally. Principal markets for these products include the United States, United Kingdom, and Nigeria. On December 30, 2018 the Company reorganized its North American business. The reorganization eliminated the legacy business unit structure and internal reporting. In addition, the Company changed the internal reporting provided to the chief operating decision maker (CODM) and segment manager. As a result, the Company reevaluated its operating segments. In conjunction with the reorganization, certain global research and development resources and related activities were transferred from the North America business to Corporate. Prior period segment results were not restated for the transfer as the impacts were not considered material. In addition, the Company transferred its Middle East, North Africa, and Turkey businesses from Kellogg Europe to Kellogg AMEA, effective December 30, 2018. This consolidated the Company's Africa business under a single regional management team. All comparable prior periods have been restated to reflect the change. For the quarter and year-to-date periods ended June 30, 2018 , the change resulted in $62 million and $129 million , respectively, of reported net sales and $10 million and $24 million , respectively, of reported operating profit transferring from Kellogg Europe to Kellogg AMEA. The Company manages its operations through four operating segments that are based on geographic location – North America which includes U.S. businesses and Canada; Europe which consists principally of European countries; Latin America which consists of Central and South America and includes Mexico; and AMEA (Asia Middle East Africa) which consists of Africa, Middle East, Australia and other Asian and Pacific markets. These operating segments also represent our reportable segments. The measurement of reportable segment results is based on segment operating profit which is generally consistent with the presentation of operating profit in the Consolidated Statement of Income. Reportable segment results were as follows: Quarter ended Year-to-date period ended (millions) June 29, June 30, June 29, June 30, Net sales North America $ 2,148 $ 2,127 $ 4,437 $ 4,457 Europe 541 559 1,038 1,079 Latin America 239 239 464 471 AMEA 533 435 1,044 754 Consolidated $ 3,461 $ 3,360 $ 6,983 $ 6,761 Operating profit North America* $ 322 $ 385 $ 702 $ 784 Europe 36 87 96 147 Latin America 17 20 38 42 AMEA 45 38 92 79 Total Reportable Segments 420 530 928 1,052 Corporate* (23 ) (56 ) (150 ) (68 ) Consolidated $ 397 $ 474 $ 778 $ 984 * Corporate in 2019 includes the cost of certain global research and development activities that were previously included in the North America reportable segment in 2018 that totaled approximately $12 million and $24 million for the quarter and year-to-date periods, respectively. Supplemental product information is provided below for net sales to external customers: Quarter ended Year-to-date period ended (millions) June 29, June 30, June 29, June 30, Snacks $ 1,741 $ 1,684 $ 3,521 $ 3,458 Cereal 1,256 1,304 2,531 2,655 Frozen 256 247 527 523 Noodles and other 208 125 404 125 Consolidated $ 3,461 $ 3,360 $ 6,983 $ 6,761 |
Supplemental Financial Statemen
Supplemental Financial Statement Data | 6 Months Ended |
Jun. 29, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Balance Sheet Disclosures [Text Block] | Supplemental Financial Statement Data Consolidated Balance Sheet (millions) June 29, 2019 (unaudited) December 29, 2018 Trade receivables $ 1,409 $ 1,163 Allowance for doubtful accounts (9 ) (10 ) Refundable income taxes 18 28 Other receivables 225 194 Accounts receivable, net $ 1,643 $ 1,375 Raw materials and supplies $ 327 $ 339 Finished goods and materials in process 907 991 Inventories $ 1,234 $ 1,330 Property $ 8,814 $ 9,173 Accumulated depreciation (5,288 ) (5,442 ) Property, net $ 3,526 $ 3,731 Pension $ 267 $ 228 Deferred income taxes 256 246 Other 648 594 Other assets $ 1,171 $ 1,068 Accrued income taxes $ 10 $ 48 Accrued salaries and wages 243 309 Accrued advertising and promotion 603 557 Current liabilities held for sale 1 — Other 552 502 Other current liabilities $ 1,409 $ 1,416 Income taxes payable $ 118 $ 115 Nonpension postretirement benefits 36 34 Noncurrent liabilities held for sale 4 — Other 330 355 Other liabilities $ 488 $ 504 |
Subsequent Event
Subsequent Event | 6 Months Ended |
Jun. 29, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Event [Text Block] | Subsequent events On July 24, 2019, the Company announced a tender offer to purchase for cash any and all of the $ $500 million 4.15% Senior Notes due November 2019, plus up to $500 million of aggregate principal of its 4.0% Senior Notes due December 2020, 3.25% Senior Notes due May 2021, 2.65% Senior Notes due May 2023, and 3.4% Senior Notes due November 2027. On July 28, 2019, the Company completed its sale of selected cookies, fruit and fruit-flavored snacks, pie crusts, and ice cream cones businesses to Ferrero for approximately $1.3 billion in cash, subject to a working capital adjustment mechanism. Both the total assets and net assets of the businesses, including a targeted working capital amount is estimated to be approximately $1.3 billion , and resulted in an immaterial pre-tax gain upon closing. After-tax proceeds from the divestiture are expected to be utilized to repay debt. In conjunction with the completion of the sale, the Company incurred closing costs of approximately $15 million in the third quarter and expects to incur a cash tax liability of approximately $260 million to be paid in the fourth quarter of 2019. Subsequent to quarter end, the Company is no longer obligated to contribute to certain multi-employer pension plans and it is probable it will incur a withdrawal liability estimated at $110 million related to its exit from these plans . This amount represents management's best estimate. Actual results could differ. The cash obligation is payable over a maximum period of 20 years ; management has not determined the actual period over which payments will be made. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 6 Months Ended |
Jun. 29, 2019 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The unaudited interim financial information of Kellogg Company (the Company) included in this report reflects all adjustments, all of which are of a normal and recurring nature, that management believes are necessary for a fair statement of the results of operations, comprehensive income, financial position, equity and cash flows for the periods presented. This interim information should be read in conjunction with the financial statements and accompanying footnotes within the Company’s 2018 Annual Report on Form 10-K. The condensed balance sheet information at December 29, 2018 was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States. The results of operations for the quarterly period ended June 29, 2019 are not necessarily indicative of the results to be expected for other interim periods or the full year. |
Accounts payable | Accounts payable |
New accounting standards adopted and accounting standards to be adopted in future periods | New accounting standards adopted in the period Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. In February 2018, the Financial Accounting Standards Board (FASB) issued an Accounting Standard Update (ASU) permitting a company to reclassify the disproportionate income tax effects of the Tax Cuts and Jobs Act of 2017 on items within accumulated other comprehensive income (AOCI) to retained earnings. We elected to adopt the ASU effective in the first quarter of 2019 and reclassified the disproportionate income tax effect recorded within AOCI to retained earnings. This resulted in a decrease to AOCI and an increase to retained earnings of $22 million . The adjustment primarily related to deferred taxes previously recorded for pension and other postretirement benefits, as well as hedging positions for debt and net investment hedges. Leases. In February 2016, the FASB issued an ASU requiring the recognition of lease assets and lease liabilities by lessees for all leases with terms greater than 12 months. The distinction between finance leases and operating leases remains, with similar classification criteria as current GAAP to distinguish between capital and operating leases. The principal difference from prior guidance is that the lease assets and lease liabilities arising from operating leases will be recognized on the Consolidated Balance Sheet. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company adopted the ASU in the first quarter of 2019, using the optional transition method that allows for a cumulative-effect adjustment in the period of adoption with no restatement of prior periods. The Company elected the package of practical expedients permitted under the transition guidance that allows for the carry forward of historical lease classifications and consistent treatment of initial direct costs for existing leases. The Company also elected to apply the practical expedient that allows the continued historical treatment of land easements. The Company did not elect the practical expedient for the use of hindsight in evaluating the expected lease term of existing leases. The adoption of the ASU resulted in the recording of operating lease assets and operating lease liabilities of approximately $453 million and $461 million , respectively, as of December 30, 2018. The difference between the additional lease assets and lease liabilities, represents existing deferred rent and prepaid lease balances that were reclassified on the balance sheet. The adoption of the ASU did not have a material impact to the Company’s Consolidated Statements of Income or Cash Flows. Accounting standards to be adopted in future periods Cloud Computing Arrangements . In August 2018, the FASB issued ASU 2018-15: Intangibles - Goodwill and Other - Internal-Use Software: Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract. The ASU allows companies to capitalize implementation costs incurred in a hosting arrangement that is a service contract over the term of the hosting arrangement, including periods covered by renewal options that are reasonably certain to be exercised. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019 and can be applied retrospectively or prospectively. Early adoption is permitted. The Company is currently assessing the impact of adoption. |
Divestitures and held for sale
Divestitures and held for sale (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of assets and liabilities held for sale | The net assets and liabilities of these businesses were classified as held for sale during the second quarter of 2019. The following table presents the major classes of assets and liabilities classified as held for sale on the Consolidated Balance Sheet as of June 29, 2019: (millions) June 29, 2019 Inventory and other assets $ 112 Total current assets 112 Property and equipment 227 Goodwill and intangible assets 956 Operating lease right-of-use assets 5 Total noncurrent assets 1,188 Total assets $ 1,300 Current operating lease liabilities $ 1 Total current liabilities 1 Operating lease liabilities 4 Total liabilities $ 5 |
Acquisitions, West Africa Inv_2
Acquisitions, West Africa Investments, Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Acquisitions, West Africa Investments, Goodwill and Other Intangible Assets [Abstract] | |
Business Acquisition, Pro Forma Information [Table Text Block] | The Company's June 30, 2018 quarter-to-date and year-to-date consolidated unaudited pro forma historical net sales and net income, as if Multipro had been acquired at the beginning of 2018, exclusive of the non-cash $245 million gain on the disposition of the equity interest recognized in the second quarter of 2018, are estimated as follows: Quarter ended Year-to-date period ended (millions) June 30, 2018 June 30, 2018 Net sales $ 3,433 $ 7,043 Net Income attributable to Kellogg Company $ 596 $ 1,040 |
Carrying Amount of Goodwill | (millions) North America Europe Latin America AMEA Consoli- dated December 29, 2018 $ 4,611 $ 346 $ 218 $ 875 $ 6,050 Held for sale (191 ) — — — (191 ) Currency translation adjustment 2 1 2 7 12 June 29, 2019 $ 4,422 $ 347 $ 220 $ 882 $ 5,871 |
Intangible Assets Subject to Amortization | Gross carrying amount (millions) North America Europe Latin America AMEA Consoli- dated December 29, 2018 $ 74 $ 39 $ 63 $ 432 $ 608 Held for sale (12 ) — — — (12 ) Currency translation adjustment — (2 ) 1 3 2 June 29, 2019 $ 62 $ 37 $ 64 $ 435 $ 598 Accumulated Amortization December 29, 2018 $ 39 $ 18 $ 12 $ 18 $ 87 Amortization 2 1 2 9 14 Held for sale (12 ) — — — (12 ) Currency translation adjustment — (1 ) — — (1 ) June 29, 2019 $ 29 $ 18 $ 14 $ 27 $ 88 Intangible assets subject to amortization, net December 29, 2018 $ 35 $ 21 $ 51 $ 414 $ 521 Amortization (2 ) (1 ) (2 ) (9 ) (14 ) Currency translation adjustment — (1 ) 1 3 3 June 29, 2019 $ 33 $ 19 $ 50 $ 408 $ 510 |
Intangible Assets Not Subject to Amortization | (millions) North America Europe Latin America AMEA Consoli- dated December 29, 2018 $ 1,985 $ 401 $ 73 $ 381 $ 2,840 Held for sale (765 ) — — — (765 ) Currency translation adjustment — (2 ) 1 3 2 June 29, 2019 $ 1,220 $ 399 $ 74 $ 384 $ 2,077 |
Restructuring and Cost Reduct_2
Restructuring and Cost Reduction Activities (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring and Cost Reduction Activities | Quarter ended Year-to-date period ended Program costs to date (millions) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 June 29, 2019 Employee related costs $ 45 $ 1 $ 42 $ 5 $ 639 Pension curtailment (gain) loss, net — — — — (167 ) Asset related costs 7 (14 ) 10 (10 ) 295 Asset impairment — — — — 169 Other costs 13 18 21 30 657 Total $ 65 $ 5 $ 73 $ 25 $ 1,593 Quarter ended Year-to-date period ended Program costs to date (millions) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 June 29, 2019 North America $ 28 $ 12 $ 32 $ 22 $ 1,054 Europe 33 (13 ) 34 (6 ) 367 Latin America 2 2 4 4 46 AMEA 2 3 3 3 101 Corporate — 1 — 2 25 Total $ 65 $ 5 $ 73 $ 25 $ 1,593 |
Schedule of Exit Cost Reserves | The following table provides details for exit cost reserves. Employee Related Costs Pension curtailment (gain) loss, net Asset Impairment Asset Related Costs Other Costs Total Liability as of December 29, 2018 $ 93 $ — $ — $ 1 $ 10 $ 104 2019 restructuring charges 42 — — 10 21 73 Cash payments (35 ) — — (5 ) (29 ) (69 ) Non-cash charges and other — — — (4 ) — (4 ) Liability as of June 29, 2019 $ 100 $ — $ — $ 2 $ 2 $ 104 |
Equity (Tables)
Equity (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Equity [Abstract] | |
Reclassifications Out of AOCI | Reclassifications out of AOCI for the quarter and year-to-date periods ended June 29, 2019 and June 30, 2018 , consisted of the following: (millions) Details about AOCI components Amount reclassified from AOCI Line item impacted within Income Statement Quarter ended June 29, 2019 Year-to-date period ended June 29, 2019 (Gains) losses on cash flow hedges: Interest rate contracts $ 2 $ 3 Interest expense $ 2 $ 3 Total before tax (1 ) (1 ) Tax expense (benefit) $ 1 $ 2 Net of tax Amortization of postretirement and postemployment benefits: Net experience (gain) loss $ (1 ) $ (2 ) OIE $ (1 ) $ (2 ) Total before tax 1 1 Tax expense (benefit) $ — $ (1 ) Net of tax Total reclassifications $ 1 $ 1 Net of tax (millions) Details about AOCI components Amount reclassified from AOCI Line item impacted within Income Statement Quarter ended June 30, 2018 Year-to-date period ended June 30, 2018 (Gains) losses on cash flow hedges: Interest rate contracts $ 2 $ 4 Interest expense $ 2 $ 4 Total before tax (1 ) (1 ) Tax expense (benefit) $ 1 $ 3 Net of tax Amortization of postretirement and postemployment benefits: Net experience loss $ (1 ) $ (2 ) See Note 8 for further details $ (1 ) $ (2 ) Total before tax — — Tax expense (benefit) $ (1 ) $ (2 ) Net of tax Total reclassifications $ — $ 1 Net of tax |
Summary of Accumulated Other Comprehensive Income (Loss) | Accumulated other comprehensive income (loss), net of tax, as of June 29, 2019 and December 29, 2018 consisted of the following: (millions) June 29, December 29, Foreign currency translation adjustments $ (1,431 ) $ (1,467 ) Cash flow hedges — unrealized net gain (loss) (65 ) (53 ) Postretirement and postemployment benefits: Net experience gain (loss) 21 23 Prior service credit (cost) 3 (3 ) Available-for-sale securities unrealized net gain (loss) 3 — Total accumulated other comprehensive income (loss) $ (1,469 ) $ (1,500 ) |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Leases [Abstract] | |
Schedule of supplemental operating lease information | (millions) Quarter ended June 29, 2019 Year-to-date period ended June 29, 2019 Other information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 32 $ 63 Right-of-use assets obtained in exchange for new operating lease liabilities $ 8 $ 20 Weighted-average remaining lease term - operating leases 6 years Weighted-average discount rate - operating leases 3.1% |
Operating leases future maturities | As previously disclosed in our 2018 Annual Report on Form 10-K and under previous lease standard (Topic 840), at December 29, 2018, future minimum annual lease commitments under non-cancelable operating leases were as follows: (millions) Operating leases 2019 121 2020 97 2021 73 2022 57 2023 48 2024 and beyond 129 Total minimum payments $ 525 At June 29, 2019, future maturities of operating leases were as follows: (millions) Operating leases 2019 (six months remaining) 65 2020 99 2021 75 2022 59 2023 47 2024 and beyond 124 Total minimum payments $ 469 Less interest $ (40 ) Less leases accounted for as held for sale $ (5 ) Present value of lease liabilities $ 424 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Debt Disclosure [Abstract] | |
Components of Notes Payable | The following table presents the components of notes payable at June 29, 2019 and December 29, 2018 : June 29, 2019 December 29, 2018 (millions) Principal amount Effective interest rate Principal amount Effective interest rate (a) U.S. commercial paper $ 355 2.55 % $ 15 2.75 % Bank borrowings 213 161 Total $ 568 $ 176 |
Stock Compensation (Tables)
Stock Compensation (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Compensation Expense for Equity-Based Programs and Related Income Tax Benefits | Quarter ended Year-to-date period ended (millions) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 Pre-tax compensation expense $ 18 $ 16 $ 32 $ 33 Related income tax benefit $ 5 $ 4 $ 8 $ 8 |
Employee Benefits (Tables)
Employee Benefits (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Retirement Benefits [Abstract] | |
Components of Plan Benefit Expense | Pension Quarter ended Year-to-date period ended (millions) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 Service cost $ 9 $ 22 $ 18 $ 44 Interest cost 44 41 89 83 Expected return on plan assets (83 ) (90 ) (168 ) (182 ) Amortization of unrecognized prior service cost 2 2 4 4 Recognized net (gain) loss 10 (2 ) 11 (11 ) Net periodic benefit cost $ (18 ) $ (27 ) $ (46 ) $ (62 ) Other nonpension postretirement Quarter ended Year-to-date period ended (millions) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 Service cost $ 4 $ 4 $ 7 $ 9 Interest cost 10 9 20 18 Expected return on plan assets (21 ) (23 ) (42 ) (47 ) Amortization of unrecognized prior service (gain) (2 ) (2 ) (4 ) (4 ) Total postretirement benefit (income) expense $ (9 ) $ (12 ) $ (19 ) $ (24 ) Postemployment Quarter ended Year-to-date period ended (millions) June 29, 2019 June 30, 2018 June 29, 2019 June 30, 2018 Service cost $ 1 $ 1 $ 2 $ 2 Interest cost 1 — 1 — Recognized net (gain) loss (1 ) (1 ) (2 ) (2 ) Total postemployment benefit expense $ 1 $ — $ 1 $ — |
Contributions to Employee Benefit Plans | Company contributions to employee benefit plans are summarized as follows: (millions) Pension Nonpension postretirement Total Quarter ended: June 29, 2019 $ 3 $ 4 $ 7 June 30, 2018 $ 251 $ 4 $ 255 Year-to-date period ended: June 29, 2019 $ 4 $ 8 $ 12 June 30, 2018 $ 266 $ 8 $ 274 Full year: Fiscal year 2019 (projected) $ 7 $ 18 $ 25 Fiscal year 2018 (actual) $ 270 $ 17 $ 287 |
Derivative Instruments and Fa_2
Derivative Instruments and Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Derivative Instruments and Fair Value Measurements [Abstract] | |
Schedule of Total Notional Amounts of Derivative Instruments | Total notional amounts of the Company’s derivative instruments as of June 29, 2019 and December 29, 2018 were as follows: (millions) June 29, December 29, Foreign currency exchange contracts $ 1,623 $ 1,863 Cross-currency contracts 1,363 1,197 Interest rate contracts 1,507 1,608 Commodity contracts 322 417 Total $ 4,815 $ 5,085 |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheet on a recurring basis as of June 29, 2019 and December 29, 2018 : Derivatives designated as hedging instruments June 29, 2019 December 29, 2018 (millions) Level 1 Level 2 Total Level 1 Level 2 Total Assets: Cross-currency contracts: Other assets $ — $ 95 $ 95 $ — $ 79 $ 79 Interest rate contracts: Other assets (a) — 6 6 — 17 17 Total assets $ — $ 101 $ 101 $ — $ 96 $ 96 Liabilities: Interest rate contracts: Other liabilities (a) — — — — (22 ) (22 ) Total liabilities $ — $ — $ — $ — $ (22 ) $ (22 ) (a) The fair value of the related hedged portion of the Company's long-term debt, a level 2 liability, was $0.7 billion and $1.6 billion as of June 29, 2019 and December 29, 2018 , respectively. Derivatives not designated as hedging instruments June 29, 2019 December 29, 2018 (millions) Level 1 Level 2 Total Level 1 Level 2 Total Assets: Foreign currency exchange contracts: Other current assets $ — $ 10 $ 10 $ — $ 3 $ 3 Commodity contracts: Other current assets 3 — 3 3 — 3 Total assets $ 3 $ 10 $ 13 $ 3 $ 3 $ 6 Liabilities: Foreign currency exchange contracts: Other current liabilities $ — $ (10 ) $ (10 ) $ — $ (4 ) $ (4 ) Other liabilities — (1 ) (1 ) — — — Interest rate contracts: Other liabilities — (14 ) (14 ) — — — Commodity contracts: Other current liabilities (8 ) — (8 ) (9 ) — (9 ) Total liabilities $ (8 ) $ (25 ) $ (33 ) $ (9 ) $ (4 ) $ (13 ) |
Schedule of Derivative Instruments in Statement of Financial Position Fair Value | The following amounts were recorded on the Consolidated Balance Sheet related to cumulative basis adjustments for existing fair value hedges as of June 29, 2019 and December 29, 2018 . (millions) Line Item in the Consolidated Balance Sheet in which the hedged item is included Carrying amount of the hedged liabilities Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged liabilities (a) June 29, December 29, June 29, December 29, Interest rate contracts Current maturities of long-term debt $ 501 $ 503 $ 1 $ 3 Interest rate contracts Long-term debt $ 3,388 $ 3,354 $ 22 $ (18 ) (a) The current maturities of hedged long-term debt includes $1 million and $3 million of hedging adjustment on discontinued hedging relationships as of June 29, 2019 and December 29, 2018 , respectively. The hedged long-term debt includes $16 million and $(12) million of hedging adjustment on discontinued hedging relationships as of June 29, 2019 and December 29, 2018 , respectively. |
Schedule of Offsetting Assets | As of June 29, 2019: Gross Amounts Not Offset in the Consolidated Balance Sheet Amounts Presented in the Consolidated Balance Sheet Financial Instruments Cash Collateral Received/ Posted Net Amount Total asset derivatives $ 114 $ (25 ) $ (7 ) $ 82 Total liability derivatives $ (33 ) $ 25 $ — $ (8 ) As of December 29, 2018: Gross Amounts Not Offset in the Consolidated Balance Sheet Amounts Presented in the Consolidated Balance Sheet Financial Instruments Cash Collateral Received/ Posted Net Amount Total asset derivatives $ 102 $ (27 ) $ (2 ) $ 73 Total liability derivatives $ (35 ) $ 27 $ — $ (8 ) |
Schedule of Offsetting Liabilities | As of June 29, 2019: Gross Amounts Not Offset in the Consolidated Balance Sheet Amounts Presented in the Consolidated Balance Sheet Financial Instruments Cash Collateral Received/ Posted Net Amount Total asset derivatives $ 114 $ (25 ) $ (7 ) $ 82 Total liability derivatives $ (33 ) $ 25 $ — $ (8 ) As of December 29, 2018: Gross Amounts Not Offset in the Consolidated Balance Sheet Amounts Presented in the Consolidated Balance Sheet Financial Instruments Cash Collateral Received/ Posted Net Amount Total asset derivatives $ 102 $ (27 ) $ (2 ) $ 73 Total liability derivatives $ (35 ) $ 27 $ — $ (8 ) |
Schedule of the Effect of Derivative Instruments on the Consolidated Statements of Income and Comprehensive Income | The effect of derivative instruments on the Consolidated Statements of Income and Comprehensive Income for the quarters ended June 29, 2019 and June 30, 2018 was as follows: Derivatives and non-derivatives in net investment hedging relationships (millions) Gain (loss) recognized in AOCI Gain (loss) excluded from assessment of hedge effectiveness Location of gain (loss) in income of excluded component June 29, June 30, June 29, June 30, Foreign currency denominated long-term debt $ (35 ) $ 146 $ — $ — Cross-currency contracts 23 35 8 3 Interest expense Total $ (12 ) $ 181 $ 8 $ 3 Derivatives not designated as hedging instruments (millions) Location of gain (loss) recognized in income Gain (loss) recognized in income June 29, June 30, Foreign currency exchange contracts COGS $ 1 $ 4 Commodity contracts COGS 40 (8 ) Total $ 41 $ (4 ) The effect of derivative instruments on the Consolidated Statements of Income and Comprehensive Income for the year-to-date periods ended June 29, 2019 and June 30, 2018 was as follows: Derivatives and non-derivatives in net investment hedging relationships (millions) Gain (loss) recognized in AOCI Gain (loss) excluded from assessment of hedge effectiveness Location of gain (loss) in income of excluded component June 29, June 30, June 29, June 30, Foreign currency denominated long-term debt $ 16 $ 73 $ — $ — Cross-currency contracts 15 27 16 6 Other income (expense), net Total $ 31 $ 100 $ 16 $ 6 Derivatives not designated as hedging instruments (millions) Location of gain (loss) recognized in income Gain (loss) recognized in income June 29, June 30, Foreign currency exchange contracts COGS $ (10 ) $ 7 Foreign currency exchange contracts Other income (expense), net (1 ) (4 ) Foreign currency exchange contracts SGA — 1 Commodity contracts COGS 8 (3 ) Total $ (3 ) $ 1 The effect of fair value and cash flow hedge accounting on the Consolidated Income Statement for the quarters ended June 29, 2019 and June 30, 2018 : June 29, 2019 June 30, 2018 (millions) Interest Expense Interest Expense Total amounts of income and expense line items presented in the Consolidated Income Statement in which the effects of fair value or cash flow hedges are recorded $ 75 $ 72 Gain (loss) on fair value hedging relationships: Interest contracts: Hedged items (13 ) (7 ) Derivatives designated as hedging instruments 13 7 Gain (loss) on cash flow hedging relationships: Interest contracts: Amount of gain (loss) reclassified from AOCI into income (2 ) (2 ) The effect of fair value and cash flow hedge accounting on the Consolidated Income Statement for the year-to-date periods ended June 29, 2019 and June 30, 2018 : June 29, 2019 June 30, 2018 (millions) Interest Expense Interest Expense Total amounts of income and expense line items presented in the Consolidated Income Statement in which the effects of fair value or cash flow hedges are recorded $ 149 $ 141 Gain (loss) on fair value hedging relationships: Interest contracts: Hedged items (37 ) 25 Derivatives designated as hedging instruments 37 (21 ) Gain (loss) on cash flow hedging relationships: Interest contracts: Amount of gain (loss) reclassified from AOCI into income (3 ) (4 ) |
Available-for-sale securities | The following is a summary of the carrying and market values of the Company's available for sale securities: June 29, 2019 December 29, 2018 Unrealized Unrealized (millions) Cost Gain (Loss) Market Value Cost Gain (Loss) Market Value Corporate bonds $ 60 $ 3 $ 63 $ 59 $ — $ 59 |
Reportable Segments (Tables)
Reportable Segments (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Reportable Segment Information | Quarter ended Year-to-date period ended (millions) June 29, June 30, June 29, June 30, Net sales North America $ 2,148 $ 2,127 $ 4,437 $ 4,457 Europe 541 559 1,038 1,079 Latin America 239 239 464 471 AMEA 533 435 1,044 754 Consolidated $ 3,461 $ 3,360 $ 6,983 $ 6,761 Operating profit North America* $ 322 $ 385 $ 702 $ 784 Europe 36 87 96 147 Latin America 17 20 38 42 AMEA 45 38 92 79 Total Reportable Segments 420 530 928 1,052 Corporate* (23 ) (56 ) (150 ) (68 ) Consolidated $ 397 $ 474 $ 778 $ 984 |
Revenue from External Customers by Products and Services | Supplemental product information is provided below for net sales to external customers: Quarter ended Year-to-date period ended (millions) June 29, June 30, June 29, June 30, Snacks $ 1,741 $ 1,684 $ 3,521 $ 3,458 Cereal 1,256 1,304 2,531 2,655 Frozen 256 247 527 523 Noodles and other 208 125 404 125 Consolidated $ 3,461 $ 3,360 $ 6,983 $ 6,761 |
Supplemental Financial Statem_2
Supplemental Financial Statement Data (Tables) | 6 Months Ended |
Jun. 29, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Financial Data Consolidated Balance Sheet [Table Text Block] | Consolidated Balance Sheet (millions) June 29, 2019 (unaudited) December 29, 2018 Trade receivables $ 1,409 $ 1,163 Allowance for doubtful accounts (9 ) (10 ) Refundable income taxes 18 28 Other receivables 225 194 Accounts receivable, net $ 1,643 $ 1,375 Raw materials and supplies $ 327 $ 339 Finished goods and materials in process 907 991 Inventories $ 1,234 $ 1,330 Property $ 8,814 $ 9,173 Accumulated depreciation (5,288 ) (5,442 ) Property, net $ 3,526 $ 3,731 Pension $ 267 $ 228 Deferred income taxes 256 246 Other 648 594 Other assets $ 1,171 $ 1,068 Accrued income taxes $ 10 $ 48 Accrued salaries and wages 243 309 Accrued advertising and promotion 603 557 Current liabilities held for sale 1 — Other 552 502 Other current liabilities $ 1,409 $ 1,416 Income taxes payable $ 118 $ 115 Nonpension postretirement benefits 36 34 Noncurrent liabilities held for sale 4 — Other 330 355 Other liabilities $ 488 $ 504 |
Accounting Policies - Narrative
Accounting Policies - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 30, 2019 | Jun. 29, 2019 | Dec. 30, 2018 | Dec. 29, 2018 | |
Impact of new accounting standards | ||||
Reclassification of tax effects relating to U.S. tax reform | $ 0 | |||
Operating lease right-of-use assets | 415 | $ 453 | $ 0 | |
Operating lease liabilities | 424 | $ 461 | ||
Obligations placed in accounts payable tracking system | 823 | 893 | ||
Obligations sold by participating suppliers | 595 | $ 701 | ||
AOCI | ||||
Impact of new accounting standards | ||||
Reclassification of tax effects relating to U.S. tax reform | $ (22) | |||
Retained earnings | ||||
Impact of new accounting standards | ||||
Reclassification of tax effects relating to U.S. tax reform | $ 22 | $ 22 |
Sale of Accounts Receivable - N
Sale of Accounts Receivable - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | Dec. 29, 2018 | |
Monetization Program | Other income (expense) | |||||
Transfer of Financial Assets Accounted for as Sales [Line Items] | |||||
Gain (Loss) on Sale of Accounts Receivable | $ (7) | $ (6) | $ (15) | $ (12) | |
Monetization Program | Maximum [Member] | |||||
Transfer of Financial Assets Accounted for as Sales [Line Items] | |||||
Transfers of Accounts Receivable Agreements | 1,033 | 1,033 | |||
Monetization Program | Sold And Outstanding | |||||
Transfer of Financial Assets Accounted for as Sales [Line Items] | |||||
Transfer of Financial Assets Accounted for as Sales, Amount Derecognized | 947 | 947 | $ 900 | ||
Kellogg Foreign Subsidiaries Other Program | |||||
Transfer of Financial Assets Accounted for as Sales [Line Items] | |||||
Transfers of Accounts Receivable Agreements | $ 21 | $ 21 | $ 93 |
Divestitures and held for sal_2
Divestitures and held for sale - Narrative (Details) - Cookies, fruit and fruit snacks businesses - USD ($) $ in Millions | Jul. 28, 2019 | Mar. 31, 2019 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Cash proceeds from sale of businesses | $ 1,300 | $ 1,300 |
Net assets | $ 1,300 | $ 1,300 |
Divestitures and held for sal_3
Divestitures and held for sale - Assets and liabilities held for sale table (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Total current assets | $ 112 | $ 0 |
Total noncurrent assets | 1,188 | 0 |
Total Current liabilities | 1 | $ 0 |
North America | Cookies, fruit and fruit snacks businesses | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Inventory and other assets | 112 | |
Total current assets | 112 | |
Property and equipment | 227 | |
Goodwill and intangibles assets | 956 | |
Operating lease right-of-use assets | 5 | |
Total noncurrent assets | 1,188 | |
Total assets | 1,300 | |
Current operating lease liabilities | 1 | |
Total Current liabilities | 1 | |
Operating lease liabilities | 4 | |
Total liabilities | $ 5 |
Acquisitions, West Africa Inv_3
Acquisitions, West Africa Investments, Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Millions | May 02, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 |
Business Acquisition [Line Items] | |||||
Amortization | $ 14 | $ 9 | |||
Equity Method Investment, Realized Gain (Loss) on Disposal | 0 | 200 | |||
Operating profit | $ 397 | $ 474 | 778 | 984 | |
Net income attributable to Kellogg Company | $ 286 | 596 | 568 | 1,040 | |
Tolaram Africa Foods (TAF) PTE LTD | |||||
Business Acquisition [Line Items] | |||||
Equity method investment, ownership percentage | 50.00% | ||||
Payments to acquire business, gross | $ 419 | ||||
Equity method investment aggregate cost | 458 | ||||
Equity Method Investment, Other than Temporary Impairment | $ 45 | ||||
TAF Investment in Affiliated Food Manufacturer | |||||
Business Acquisition [Line Items] | |||||
Equity method investment, ownership percentage | 49.00% | ||||
Affiliated Food Manufacturer | |||||
Business Acquisition [Line Items] | |||||
Equity method investment, ownership percentage | 24.50% | ||||
Multipro | |||||
Business Acquisition [Line Items] | |||||
Equity method investment incremental ownership percentage change | 1.00% | ||||
Business Acquisition, Pro Forma Revenue | 3,433 | 7,043 | |||
Business Acquisition, Pro Forma Net Income (Loss) | 596 | $ 1,040 | |||
Equity method investment, ownership percentage | 51.00% | ||||
Equity Method Investment, Realized Gain (Loss) on Disposal | $ 245 | $ 245 |
Acquisitions, West Africa Inv_4
Acquisitions, West Africa Investments, Goodwill and Other Intangible Assets - Carrying Amount of Goodwill (Details) $ in Millions | 6 Months Ended |
Jun. 29, 2019USD ($) | |
Change in carrying amount of goodwill | |
Beginning Balance | $ 6,050 |
Held for sale | (191) |
Currency translation adjustment | 12 |
Ending Balance | 5,871 |
North America | |
Change in carrying amount of goodwill | |
Beginning Balance | 4,611 |
Held for sale | (191) |
Currency translation adjustment | 2 |
Ending Balance | 4,422 |
Europe | |
Change in carrying amount of goodwill | |
Beginning Balance | 346 |
Held for sale | 0 |
Currency translation adjustment | 1 |
Ending Balance | 347 |
Latin America | |
Change in carrying amount of goodwill | |
Beginning Balance | 218 |
Held for sale | 0 |
Currency translation adjustment | 2 |
Ending Balance | 220 |
AMEA | |
Change in carrying amount of goodwill | |
Beginning Balance | 875 |
Held for sale | 0 |
Currency translation adjustment | 7 |
Ending Balance | $ 882 |
Acquisitions, West Africa Inv_5
Acquisitions, West Africa Investments, Goodwill and Other Intangible Assets - Intangible Assets Subject to Amortization (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 29, 2019 | Jun. 30, 2018 | |
Finite-lived Intangible Assets [Roll Forward] | ||
Gross carrying amount, beginning balance | $ 608 | |
Held for sale finite lived intangible assets | (12) | |
Currency translation adjustment | 2 | |
Gross carrying amount, ending balance | 598 | |
Accumulated amortization, beginning balance | 87 | |
Amortization | 14 | $ 9 |
Held for sale amortization | (12) | |
Currency translation adjustment | (1) | |
Accumulated amortization, ending balance | 88 | |
Intangible assets subject to amortization net, beginning balance | 521 | |
Amortization | (14) | |
Currency translation adjustment | 3 | |
Intangible assets subject to amortization net, ending balance | 510 | |
Currently estimated aggregate annual amortization expense for full-year | 27 | |
North America | ||
Finite-lived Intangible Assets [Roll Forward] | ||
Gross carrying amount, beginning balance | 74 | |
Held for sale finite lived intangible assets | (12) | |
Currency translation adjustment | 0 | |
Gross carrying amount, ending balance | 62 | |
Accumulated amortization, beginning balance | 39 | |
Amortization | 2 | |
Held for sale amortization | (12) | |
Currency translation adjustment | 0 | |
Accumulated amortization, ending balance | 29 | |
Intangible assets subject to amortization net, beginning balance | 35 | |
Amortization | (2) | |
Currency translation adjustment | 0 | |
Intangible assets subject to amortization net, ending balance | 33 | |
Europe | ||
Finite-lived Intangible Assets [Roll Forward] | ||
Gross carrying amount, beginning balance | 39 | |
Held for sale finite lived intangible assets | 0 | |
Currency translation adjustment | (2) | |
Gross carrying amount, ending balance | 37 | |
Accumulated amortization, beginning balance | 18 | |
Amortization | 1 | |
Held for sale amortization | 0 | |
Currency translation adjustment | (1) | |
Accumulated amortization, ending balance | 18 | |
Intangible assets subject to amortization net, beginning balance | 21 | |
Amortization | (1) | |
Currency translation adjustment | (1) | |
Intangible assets subject to amortization net, ending balance | 19 | |
Latin America | ||
Finite-lived Intangible Assets [Roll Forward] | ||
Gross carrying amount, beginning balance | 63 | |
Held for sale finite lived intangible assets | 0 | |
Currency translation adjustment | 1 | |
Gross carrying amount, ending balance | 64 | |
Accumulated amortization, beginning balance | 12 | |
Amortization | 2 | |
Held for sale amortization | 0 | |
Currency translation adjustment | 0 | |
Accumulated amortization, ending balance | 14 | |
Intangible assets subject to amortization net, beginning balance | 51 | |
Amortization | (2) | |
Currency translation adjustment | 1 | |
Intangible assets subject to amortization net, ending balance | 50 | |
AMEA | ||
Finite-lived Intangible Assets [Roll Forward] | ||
Gross carrying amount, beginning balance | 432 | |
Held for sale finite lived intangible assets | 0 | |
Currency translation adjustment | 3 | |
Gross carrying amount, ending balance | 435 | |
Accumulated amortization, beginning balance | 18 | |
Amortization | 9 | |
Held for sale amortization | 0 | |
Currency translation adjustment | 0 | |
Accumulated amortization, ending balance | 27 | |
Intangible assets subject to amortization net, beginning balance | 414 | |
Amortization | (9) | |
Currency translation adjustment | 3 | |
Intangible assets subject to amortization net, ending balance | $ 408 |
Acquisitions, West Africa Inv_6
Acquisitions, West Africa Investments, Goodwill and Other Intangible Assets - Intangible Assets Not Subject to Amortization (Details) $ in Millions | 6 Months Ended |
Jun. 29, 2019USD ($) | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | $ 2,840 |
Held for sale | (765) |
Currency translation adjustment | 2 |
Intangible assets not subject to amortization, ending balance | 2,077 |
North America | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | 1,985 |
Held for sale | (765) |
Currency translation adjustment | 0 |
Intangible assets not subject to amortization, ending balance | 1,220 |
Europe | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | 401 |
Held for sale | 0 |
Currency translation adjustment | (2) |
Intangible assets not subject to amortization, ending balance | 399 |
Latin America | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | 73 |
Held for sale | 0 |
Currency translation adjustment | 1 |
Intangible assets not subject to amortization, ending balance | 74 |
AMEA | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Intangible assets not subject to amortization, beginning balance | 381 |
Held for sale | 0 |
Currency translation adjustment | 3 |
Intangible assets not subject to amortization, ending balance | $ 384 |
Acquistions, West Africa Invest
Acquistions, West Africa Investments, Goodwill and Other Intangible Assets Acquisitions, West Africa Investments, Goodwill and Other Intangible Assets - Impairment Testing (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Goodwill [Line Items] | ||
Goodwill | $ 5,871 | $ 6,050 |
Kashi | ||
Goodwill [Line Items] | ||
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 18.00% | |
Europe transfer to AMEA | ||
Goodwill [Line Items] | ||
Goodwill | 46 | |
North America | ||
Goodwill [Line Items] | ||
Goodwill | 4,422 | $ 4,611 |
Held for sale goodwill | 191 | |
Held for sale net intangibles | $ 765 |
Restructuring and Cost Reduct_3
Restructuring and Cost Reduction Activities - Narrative (Details) | 6 Months Ended |
Jun. 29, 2019 | |
Minimum [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related activities cash implementation costs recovery time frame | 3 years |
Maximum [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related activities cash implementation costs recovery time frame | 5 years |
Restructuring and Cost Reduct_4
Restructuring and Cost Reduction Activities - Project K Anticipated Costs Narrative (Details) - Maximum [Member] - Project K [Member] $ in Millions | 3 Months Ended |
Jun. 29, 2019USD ($) | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related costs, expected cost | $ 1,600 |
Estimated after-tax cash costs for program, including incremental capital investments | 1,200 |
Asset related costs | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related costs, expected cost | 500 |
Employee related costs | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related costs, expected cost | 400 |
Other costs | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related costs, expected cost | $ 700 |
Restructuring and Cost Reduct_5
Restructuring and Cost Reduction Activities - Project K Expected Program Costs by Reportable Segment Narrative (Details) - Project K [Member] | 6 Months Ended |
Jun. 29, 2019 | |
North America | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related cost, expected cost allocation | 65.00% |
Europe | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related cost, expected cost allocation | 22.00% |
Latin America | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related cost, expected cost allocation | 3.00% |
AMEA | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related cost, expected cost allocation | 6.00% |
Corporate | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related cost, expected cost allocation | 4.00% |
Restructuring and Cost Reduct_6
Restructuring and Cost Reduction Activities Restructuring and Cost Reduction Activities - Project K Program Costs Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 65 | $ 5 | $ 73 | $ 25 |
Project K [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 15 | $ 5 | $ 23 | $ 25 |
Restructuring and Cost Reduct_7
Restructuring and Cost Reduction Activities - Project K Program Costs Since Inception Narrative (Details) $ in Millions | Jun. 29, 2019USD ($) |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related costs since inception of program | $ 1,593 |
Project K [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related costs since inception of program | 1,543 |
Project K [Member] | Revenue | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related costs since inception of program | 6 |
Project K [Member] | COGS | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related costs since inception of program | 910 |
Project K [Member] | Selling, General and Administrative Expenses | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related costs since inception of program | 794 |
Project K [Member] | Other (income) expense, net | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and related costs since inception of program | $ (167) |
Restructuring and Cost Reduct_8
Restructuring and Cost Reduction Activities Restructuring and Cost Reduction Activities - Other Programs Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 65 | $ 5 | $ 73 | $ 25 |
Selling, General and Administrative Expenses | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 54 | $ 9 | 56 | $ 16 |
Europe | Other Programs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and related costs, expected cost | 50 | 50 | ||
Cash costs | 57 | |||
Europe | Other Programs [Member] | Selling, General and Administrative Expenses | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 32 | |||
North America | Other Programs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and related costs, expected cost | 35 | $ 35 | ||
North America | Other Programs [Member] | Selling, General and Administrative Expenses | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 18 |
Restructuring and Cost Reduct_9
Restructuring and Cost Reduction Activities Restructuring and Cost Reduction Activities - Total Projects Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 65 | $ 5 | $ 73 | $ 25 |
COGS | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 11 | (4) | 17 | 9 |
Selling, General and Administrative Expenses | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 54 | $ 9 | $ 56 | $ 16 |
Restructuring and Cost Reduc_10
Restructuring and Cost Reduction Activities - Schedule of Restructuring and Cost Reduction Activities (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 65 | $ 5 | $ 73 | $ 25 |
Program costs to date | 1,593 | 1,593 | ||
Employee related costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 45 | 1 | 42 | 5 |
Program costs to date | 639 | 639 | ||
Pension curtailment (gain) loss, net | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 0 | 0 | 0 | 0 |
Program costs to date | (167) | (167) | ||
Asset related costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 7 | (14) | 10 | (10) |
Program costs to date | 295 | 295 | ||
Asset impairment | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 0 | 0 | 0 | 0 |
Program costs to date | 169 | 169 | ||
Other costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 13 | 18 | 21 | 30 |
Program costs to date | 657 | 657 | ||
Operating Segments | North America | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 28 | 12 | 32 | 22 |
Program costs to date | 1,054 | 1,054 | ||
Operating Segments | Europe | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 33 | (13) | 34 | (6) |
Program costs to date | 367 | 367 | ||
Operating Segments | Latin America | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 2 | 2 | 4 | 4 |
Program costs to date | 46 | 46 | ||
Operating Segments | AMEA | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 2 | 3 | 3 | 3 |
Program costs to date | 101 | 101 | ||
Corporate | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 0 | 1 | 0 | 2 |
Program costs to date | 25 | 25 | ||
Project K [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 15 | $ 5 | 23 | $ 25 |
Program costs to date | $ 1,543 | $ 1,543 |
Restructuring and Cost Reduc_11
Restructuring and Cost Reduction Activities Restructuring and Cost Reduction Activities - Schedule of Restructuring and Cost Reduction Activities Project Reserves Narrative (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Restructuring and Related Activities [Abstract] | ||
Project reserve | $ 104 | $ 104 |
Restructuring and Cost Reduc_12
Restructuring and Cost Reduction Activities - Restructuring and Cost Reduction Reserves Rollforward (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Restructuring Reserve [Roll Forward] | ||||
Liability, beginning balance | $ 104 | |||
Restructuring charges | $ 65 | $ 5 | 73 | $ 25 |
Cash payments | (69) | |||
Non-cash charges and other | (4) | |||
Liability, ending balance | 104 | 104 | ||
Employee related costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Liability, beginning balance | 93 | |||
Restructuring charges | 45 | 1 | 42 | 5 |
Cash payments | (35) | |||
Non-cash charges and other | 0 | |||
Liability, ending balance | 100 | 100 | ||
Pension curtailment (gain) loss, net | ||||
Restructuring Reserve [Roll Forward] | ||||
Liability, beginning balance | 0 | |||
Restructuring charges | 0 | 0 | 0 | 0 |
Cash payments | 0 | |||
Non-cash charges and other | 0 | |||
Liability, ending balance | 0 | 0 | ||
Asset impairment | ||||
Restructuring Reserve [Roll Forward] | ||||
Liability, beginning balance | 0 | |||
Restructuring charges | 0 | 0 | 0 | 0 |
Cash payments | 0 | |||
Non-cash charges and other | 0 | |||
Liability, ending balance | 0 | 0 | ||
Asset related costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Liability, beginning balance | 1 | |||
Restructuring charges | 7 | (14) | 10 | (10) |
Cash payments | (5) | |||
Non-cash charges and other | (4) | |||
Liability, ending balance | 2 | 2 | ||
Other costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Liability, beginning balance | 10 | |||
Restructuring charges | 13 | 18 | 21 | 30 |
Cash payments | (29) | |||
Non-cash charges and other | 0 | |||
Liability, ending balance | 2 | 2 | ||
Project K [Member] | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring charges | $ 15 | $ 5 | $ 23 | $ 25 |
Equity - Narrative (Details)
Equity - Narrative (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | Dec. 30, 2017 | |
Equity, Class of Treasury Stock [Line Items] | |||||
Anti-dilutive potential common shares excluded from reconciliation | 15 | 9 | 14 | 6 | |
Common stock repurchased | $ 50 | $ 220 | $ 50 | ||
December 2017 Share Repurchase Program | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Stock repurchase program, authorized amount | $ 1,500 | ||||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 960 | $ 960 | |||
Common stock repurchased (in shares) | 4 | 1 | |||
Common stock repurchased | $ 220 | $ 50 |
Equity - Reclassifications Out
Equity - Reclassifications Out of AOCI (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
COGS | $ 2,275 | $ 2,151 | $ 4,690 | $ 4,300 |
SG&A | (789) | (735) | (1,515) | (1,477) |
Interest expense | 75 | 72 | 149 | 141 |
Net experience (gain) loss | 1 | 1 | 2 | 2 |
Total before tax | 367 | 471 | 726 | 982 |
Tax expense (benefit) | (74) | (70) | (146) | (137) |
Net income | 292 | 599 | 577 | 1,043 |
Reclassification out of Accumulated Other Comprehensive Income | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net income | 0 | 1 | 1 | |
Reclassification out of Accumulated Other Comprehensive Income | (Gains) losses on cash flow hedges | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Total before tax | 2 | 2 | 3 | 4 |
Tax expense (benefit) | (1) | (1) | (1) | (1) |
Net income | 1 | 1 | 2 | 3 |
Reclassification out of Accumulated Other Comprehensive Income | (Gains) losses on cash flow hedges | Interest rate contracts | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Interest expense | 2 | 2 | 3 | 4 |
Reclassification out of Accumulated Other Comprehensive Income | Amortization of postretirement and postemployment benefits | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net experience (gain) loss | (1) | (2) | ||
Total before tax | (1) | (1) | (2) | (2) |
Tax expense (benefit) | 1 | 0 | 1 | 0 |
Net income | 0 | $ (1) | (1) | $ (2) |
Reclassification out of Accumulated Other Comprehensive Income | Amortization of postretirement and postemployment benefits | Other income (expense), net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Net experience (gain) loss | $ (1) | $ (2) |
Equity - Summary of Accumulated
Equity - Summary of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||
Foreign currency translation adjustments | $ (1,431) | $ (1,467) |
Cash flow hedges — unrealized net gain (loss) | (65) | (53) |
Postretirement and postemployment benefits: | ||
Net experience gain (loss) | 21 | 23 |
Prior service credit (cost) | 3 | (3) |
Available-for-sale securities unrealized net gain (loss) | 3 | 0 |
Total accumulated other comprehensive income (loss) | $ (1,469) | $ (1,500) |
Leases - Narrative (Details)
Leases - Narrative (Details) | Jun. 29, 2019 |
Minimum [Member] | |
Lessee, Lease, Description [Line Items] | |
Lessee, Operating Lease, Term of Contract | 1 year |
Maximum [Member] | |
Lessee, Lease, Description [Line Items] | |
Lessee, Operating Lease, Term of Contract | 10 years |
Leases - Supplemental Operating
Leases - Supplemental Operating Lease Information Table Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 29, 2019 | Jun. 29, 2019 | |
Leases [Abstract] | ||
Operating lease costs | $ 32 | $ 64 |
Leases - Supplemental Operati_2
Leases - Supplemental Operating Leases Information Table (Details) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 29, 2019USD ($) | Jun. 29, 2019USD ($) | |
Leases [Abstract] | ||
Operating Lease, Payments | $ 32 | $ 63 |
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | $ 8 | $ 20 |
Operating Lease, Weighted Average Remaining Lease Term | 6 years | 6 years |
Operating Lease, Weighted Average Discount Rate, Percent | 3.10% | 3.10% |
Leases - Operating Leases Futur
Leases - Operating Leases Future Maturities (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 30, 2018 |
Leases [Abstract] | ||
Operating leases, 2019 (six months remaining) | $ 65 | |
Operating leases, 2020 | 99 | |
Operating leases, 2021 | 75 | |
Operating leases, 2022 | 59 | |
Operating leases, 2023 | 47 | |
Operating leases, 2024 and beyond | 124 | |
Operating leases, total minimum payments | 469 | |
Operating leases, interest | (40) | |
Leases accounted for as held for sale | (5) | |
Operating Leases, present value of lease liabilities | $ 424 | $ 461 |
Leases - Operating Leases Fut_2
Leases - Operating Leases Future Minimum Lease Commitments (Details) $ in Millions | Dec. 29, 2018USD ($) |
Leases [Abstract] | |
Operating leases, future minimum payments due 2019 | $ 121 |
Operating leases, future minimum payments due 2020 | 97 |
Operating leases, future minimum payments due 2021 | 73 |
Operating leases, future minimum payments due 2022 | 57 |
Operating leases, future minimum payments due 2023 | 48 |
Operating leases, future minimum payments due 2024 and beyond | 129 |
Operating leases, total minimum payments | $ 525 |
Leases - Operating Leases Fut_3
Leases - Operating Leases Future Minimum Lease Commitments Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 29, 2018 | Jun. 29, 2019 | |
Leases [Abstract] | ||
Minimum lease payments for real-estate leases signed but not yet commenced | $ 144 | |
Operating lease rent expense | $ 133 |
Debt - Components of Notes Paya
Debt - Components of Notes Payable (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Short-term Debt [Line Items] | ||
Principal amount | $ 568 | $ 176 |
U.S. commercial paper | ||
Short-term Debt [Line Items] | ||
Principal amount | $ 355 | $ 15 |
Effective interest rate | 2.55% | 2.75% |
Bank borrowings | ||
Short-term Debt [Line Items] | ||
Principal amount | $ 213 | $ 161 |
Stock Compensation - Compensati
Stock Compensation - Compensation Expense (Details) - Selling General and Administrative Expenses - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Pre-tax compensation expense | $ 18 | $ 16 | $ 32 | $ 33 |
Related income tax benefit | $ 5 | $ 4 | $ 8 | $ 8 |
Stock Compensation - Restricted
Stock Compensation - Restricted Stock (Details) - Restricted stock units shares in Millions | 6 Months Ended |
Jun. 29, 2019$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Granted (in shares) | shares | 0.9 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Granted, weighted-average grant-date fair value (in dollars per share) | $ / shares | $ 56 |
Stock Compensation - Stock Opti
Stock Compensation - Stock Options (Details) shares in Millions | 6 Months Ended |
Jun. 29, 2019$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Granted (in shares) | shares | 2.8 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |
Granted, weighted-average exercise price (in dollars per share) | $ / shares | $ 7 |
Stock Compensation - Performanc
Stock Compensation - Performance Shares (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | |
Feb. 28, 2019 | Mar. 30, 2019 | Jun. 29, 2019 | |
2019 Award | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Performance shares target grant distribution (in shares) | 239,000 | ||
Grant-date fair value of shares that correspond with target grants | $ 59 | ||
2016 Award | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of performance shares that may be earned upon performance | 85.00% | ||
Performance share award settlement | $ 6 | ||
Minimum [Member] | 2019 Award | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of performance shares that may be earned upon performance | 0.00% | ||
Maximum [Member] | 2019 Award | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of performance shares that may be earned upon performance | 200.00% |
Employee Benefits - Components
Employee Benefits - Components of Plan Benefit Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Global | Pension | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 9 | $ 22 | $ 18 | $ 44 |
Interest cost | 44 | 41 | 89 | 83 |
Expected return on plan assets | (83) | (90) | (168) | (182) |
Amortization of unrecognized prior service cost (gain) | 2 | 2 | 4 | 4 |
Recognized net (gain) loss | 10 | (2) | 11 | (11) |
Net periodic benefit cost | (18) | (27) | (46) | (62) |
Global | Postemployment | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 1 | 1 | 2 | 2 |
Interest cost | 1 | 0 | 1 | 0 |
Recognized net (gain) loss | (1) | (1) | (2) | (2) |
Total plan benefit (income) expense | 1 | 0 | 1 | 0 |
United States and Canada | Other Nonpension Postretirement | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 4 | 4 | 7 | 9 |
Interest cost | 10 | 9 | 20 | 18 |
Expected return on plan assets | (21) | (23) | (42) | (47) |
Amortization of unrecognized prior service cost (gain) | (2) | (2) | (4) | (4) |
Total plan benefit (income) expense | $ (9) | $ (12) | $ (19) | $ (24) |
Employee Benefits - Component_2
Employee Benefits - Components of Plan Benefit Expense Narrative (Details) $ in Millions | 6 Months Ended |
Jun. 29, 2019USD ($) | |
United States | Pension | |
Defined Benefit Plan Disclosure [Line Items] | |
Recognized net loss | $ 11 |
Employee Benefits - Contributio
Employee Benefits - Contributions to Employee Benefit Plans (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | Dec. 29, 2018 | |
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer contributions to employee benefit plans | $ 7 | $ 255 | $ 12 | $ 274 | $ 287 |
Total current year projected employer contributions | 25 | 25 | |||
Employer discretionary contribution amount | 250 | ||||
Pension | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer contributions to employee benefit plans | 3 | 251 | 4 | 266 | 270 |
Total current year projected employer contributions | 7 | 7 | |||
Nonpension postretirement | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer contributions to employee benefit plans | 4 | 4 | 8 | $ 8 | $ 17 |
Total current year projected employer contributions | $ 18 | $ 18 | |||
United States | Pension | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer discretionary contribution amount | $ 250 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Income Tax Contingency [Line Items] | ||||
Effective income tax rate | 20.00% | 15.00% | 20.00% | 14.00% |
Employer discretionary contribution amount | $ 250 | |||
Discrete tax benefit | $ 31 | $ 44 | ||
Unrecognized tax benefits | $ 97 | $ 97 | ||
Unrecognized tax benefits that would affect the effective income tax rate | 87 | 87 | ||
Tax-related interest and penalties accrual | 22 | 22 | ||
Other current liabilities | ||||
Income Tax Contingency [Line Items] | ||||
Unrecognized tax benefits | 10 | 10 | ||
Projected additions to unrecognized tax benefits | $ 2 | $ 2 |
Derivative Instruments and Fa_3
Derivative Instruments and Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 29, 2019 | Dec. 29, 2018 | |
Derivative [Line Items] | ||
Net deferred losses reported in AOCI to be reclassified into income in the next twelve months | $ (5) | |
Collateral posted | 0 | |
Derivative, Collateral, Obligation to Return Cash | 7 | $ 2 |
Other liabilities | ||
Derivative [Line Items] | ||
Derivative, Collateral, Obligation to Return Cash | 19 | |
Accounts Receivable, Net | ||
Derivative [Line Items] | ||
Collateral posted | 0 | |
Accounts Receivable, Net | Exchange-traded commodity | ||
Derivative [Line Items] | ||
Margin deposits | $ 12 | |
Five Largest Accounts | Customer Concentration Risk | Accounts Receivable, Net | ||
Derivative [Line Items] | ||
Concentration percentage | 20.00% |
Derivative Instruments and Fa_4
Derivative Instruments and Fair Value Measurements - Schedule of Total Notional Amounts of Derivative Instruments (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Derivatives, Fair Value [Line Items] | ||
Notional amount of derivatives | $ 4,815 | $ 5,085 |
Foreign currency exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount of derivatives | 1,623 | 1,863 |
Cross currency interest rate contract | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount of derivatives | 1,363 | 1,197 |
Interest rate contracts | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount of derivatives | 1,507 | 1,608 |
Commodity contracts | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount of derivatives | $ 322 | $ 417 |
Derivative Instruments and Fa_5
Derivative Instruments and Fair Value Measurements - Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 | |
Derivatives, Fair Value [Line Items] | |||
Fair Value Of Related Hedge Portion Of Long Term Debt | $ 700 | $ 1,600 | |
Long-term debt total, carrying value | 8,300 | 8,200 | |
Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 101 | 96 | |
Liabilities | 0 | (22) | |
Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 13 | 6 | |
Liabilities | (33) | (13) | |
Level 1 | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 0 | 0 | |
Liabilities | 0 | 0 | |
Level 1 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 3 | 3 | |
Liabilities | (8) | (9) | |
Level 2 | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 101 | 96 | |
Liabilities | 0 | (22) | |
Level 2 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 10 | 3 | |
Liabilities | (25) | (4) | |
Cross currency interest rate contract | Other assets | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 95 | 79 | |
Cross currency interest rate contract | Other assets | Level 1 | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 0 | 0 | |
Cross currency interest rate contract | Other assets | Level 2 | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 95 | 79 | |
Foreign currency exchange contracts | Other current assets | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 10 | 3 | |
Foreign currency exchange contracts | Other current assets | Level 1 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 0 | 0 | |
Foreign currency exchange contracts | Other current assets | Level 2 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 10 | 3 | |
Foreign currency exchange contracts | Other current liabilities | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | (10) | (4) | |
Foreign currency exchange contracts | Other current liabilities | Level 1 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | 0 | 0 | |
Foreign currency exchange contracts | Other current liabilities | Level 2 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | (10) | (4) | |
Foreign currency exchange contracts | Other liabilities | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | (1) | 0 | |
Foreign currency exchange contracts | Other liabilities | Level 1 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | 0 | 0 | |
Foreign currency exchange contracts | Other liabilities | Level 2 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | (1) | 0 | |
Interest rate contracts | Other assets | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 6 | 17 | |
Interest rate contracts | Other assets | Level 1 | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 0 | 0 | |
Interest rate contracts | Other assets | Level 2 | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | [1] | 6 | 17 |
Interest rate contracts | Other liabilities | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | 0 | (22) | |
Interest rate contracts | Other liabilities | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | (14) | 0 | |
Interest rate contracts | Other liabilities | Level 1 | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | 0 | 0 | |
Interest rate contracts | Other liabilities | Level 1 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | 0 | 0 | |
Interest rate contracts | Other liabilities | Level 2 | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | [1] | 0 | (22) |
Interest rate contracts | Other liabilities | Level 2 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | (14) | 0 | |
Commodity contracts | Other current assets | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 3 | 3 | |
Commodity contracts | Other current assets | Level 1 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 3 | 3 | |
Commodity contracts | Other current assets | Level 2 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 0 | 0 | |
Commodity contracts | Other current liabilities | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | (8) | (9) | |
Commodity contracts | Other current liabilities | Level 1 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | (8) | (9) | |
Commodity contracts | Other current liabilities | Level 2 | Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | 0 | 0 | |
Net Investment Hedging | |||
Derivatives, Fair Value [Line Items] | |||
Long-term debt total, carrying value | $ 2,600 | $ 2,600 | |
[1] | The fair value of the related hedged portion of the Company's long-term debt, a level 2 liability, was $0.7 billion and $1.6 billion as of June 29, 2019 and December 29, 2018 , respectively. |
Derivative Instruments and Fa_6
Derivative Instruments and Fair Value Measurements - Schedule of Cumulative Basis Adjustments for Fair Value Hedges (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 | |
Derivatives, Fair Value [Line Items] | |||
Current maturities of long-term debt | $ 508 | $ 510 | |
Long-term debt | 8,262 | 8,207 | |
Carrying amount of hedged liability | Fair Value Hedges | Interest rate contracts | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Current maturities of long-term debt | 501 | 503 | |
Long-term debt | 3,388 | 3,354 | |
Cumulative fair value adjustment | Fair Value Hedges | Interest rate contracts | Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Current maturities of long-term debt | [1] | 1 | 3 |
Long-term debt | [1] | 22 | (18) |
Hedging adjustment | Discontinued Hedges | Interest rate contracts | |||
Derivatives, Fair Value [Line Items] | |||
Current maturities of long-term debt | 1 | 3 | |
Long-term debt | $ 16 | $ (12) | |
[1] | The current maturities of hedged long-term debt includes $1 million and $3 million of hedging adjustment on discontinued hedging relationships as of June 29, 2019 and December 29, 2018 , respectively. The hedged long-term debt includes $16 million and $(12) million of hedging adjustment on discontinued hedging relationships as of June 29, 2019 and December 29, 2018 , respectively. |
Derivative Instruments and Fa_7
Derivative Instruments and Fair Value Measurements - Schedule of Offsetting Assets and Liabilities (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Offsetting [Abstract] | ||
Asset derivatives, Amounts Presented in the Consolidated Balance Sheet | $ 114 | $ 102 |
Asset derivatives, Financial Instruments, Gross Amounts Not Offset in the Consolidated Balance Sheet | (25) | (27) |
Asset derivatives, Cash Collateral Posted, Gross Amounts Not Offset in the Consolidated Balance Sheet | (7) | (2) |
Asset derivatives, Net Amount | 82 | 73 |
Liability derivatives, Amounts Presented in the Consolidated Balance Sheet | (33) | (35) |
Liability derivatives, Financial Instruments, Gross Amounts Not Offset in the Consolidated Balance Sheet | 25 | 27 |
Liability derivatives, Cash Collateral Received, Gross Amounts Not Offset in the Consolidated Balance Sheet | 0 | 0 |
Liability derivatives, net amount | $ (8) | $ (8) |
Derivative Instruments and Fa_8
Derivative Instruments and Fair Value Measurements - Effect of Derivative Instruments on the Consolidated Statements of Income and Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in AOCI | $ 3 | $ 3 | ||
Not Designated as Hedging Instrument | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in income | $ 41 | (4) | $ (3) | 1 |
Not Designated as Hedging Instrument | Foreign currency exchange contracts | COGS | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in income | 1 | 4 | (10) | 7 |
Not Designated as Hedging Instrument | Foreign currency exchange contracts | Selling, General and Administrative Expenses | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in income | 0 | 1 | ||
Not Designated as Hedging Instrument | Foreign currency exchange contracts | Other income (expense), net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in income | (1) | (4) | ||
Not Designated as Hedging Instrument | Commodity contracts | COGS | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in income | 40 | (8) | 8 | (3) |
Net Investment Hedging | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in AOCI | (12) | 181 | 31 | 100 |
Gain (Loss) from Components Excluded from Assessment of Fair Value Hedge Effectiveness, Net | 8 | 3 | 16 | 6 |
Net Investment Hedging | Foreign currency denominated long-term debt | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in AOCI | (35) | 146 | 16 | 73 |
Gain (Loss) from Components Excluded from Assessment of Fair Value Hedge Effectiveness, Net | 0 | 0 | 0 | 0 |
Net Investment Hedging | Cross currency interest rate contract | Interest expense | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in AOCI | 23 | 35 | ||
Gain (Loss) from Components Excluded from Assessment of Fair Value Hedge Effectiveness, Net | $ 8 | $ 3 | ||
Net Investment Hedging | Cross currency interest rate contract | Other income (expense), net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in AOCI | 15 | 27 | ||
Gain (Loss) from Components Excluded from Assessment of Fair Value Hedge Effectiveness, Net | $ 16 | $ 6 |
Derivative Instruments and Fa_9
Derivative Instruments and Fair Value Measurements - Schedule of Effect of Fair Value and Cash Flow Hedge Accounting on Consolidated Statement of Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Interest Expense, Debt | $ 75 | $ 72 | $ 149 | $ 141 |
Interest rate contracts | Interest expense | Designated as Hedging Instrument | Fair Value Hedges | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Hedged items | (13) | (7) | (37) | 25 |
Derivatives designated as hedging instruments | 13 | 7 | 37 | (21) |
Interest rate contracts | Interest expense | Designated as Hedging Instrument | Cash Flow Hedging | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) reclassified from AOCI into income | $ (2) | $ (2) | $ (3) | $ (4) |
Derivative Instruments and F_10
Derivative Instruments and Fair Value Measurements - Schedule of Other Fair Value Measurements (Details) - Corporate bonds - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Available-for-sale securities, cost | $ 60 | $ 59 |
Available-for-sale securities, unrealized gain (loss) | 3 | 0 |
Available-for-sale securities, market value | $ 63 | $ 59 |
Derivative Instruments and F_11
Derivative Instruments and Fair Value Measurements - Schedule of Fair Value of Long-term Debt (Details) - USD ($) $ in Billions | Jun. 29, 2019 | Dec. 29, 2018 |
Derivative Instruments and Fair Value Measurements [Abstract] | ||
Long-term debt, fair value | $ 8.7 | $ 8.2 |
Long-term debt total, carrying value | $ 8.3 | $ 8.2 |
Reportable Segments (Details)
Reportable Segments (Details) $ in Millions | 3 Months Ended | 6 Months Ended | ||||||
Jun. 29, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 29, 2019USD ($) | Jun. 30, 2018USD ($) | |||||
Segment Reporting Information [Line Items] | ||||||||
Number of operating segments | 4 | |||||||
Net sales | $ 3,461 | $ 3,360 | $ 6,983 | $ 6,761 | ||||
Operating profit | 397 | 474 | 778 | 984 | ||||
Europe transfer to AMEA | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Net sales | 62 | 129 | ||||||
Operating profit | 10 | 24 | ||||||
Operating Segments | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Operating profit | 420 | 530 | 928 | 1,052 | ||||
Operating Segments | North America | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Net sales | 2,148 | 2,127 | 4,437 | 4,457 | ||||
Operating profit | 322 | 385 | [1] | 702 | 784 | [1] | ||
Research and development expense | 12 | 24 | ||||||
Operating Segments | Europe | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Net sales | 541 | 559 | 1,038 | 1,079 | ||||
Operating profit | 36 | 87 | 96 | 147 | ||||
Operating Segments | Latin America | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Net sales | 239 | 239 | 464 | 471 | ||||
Operating profit | 17 | 20 | 38 | 42 | ||||
Operating Segments | AMEA | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Net sales | 533 | 435 | 1,044 | 754 | ||||
Operating profit | 45 | 38 | 92 | 79 | ||||
Corporate | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Operating profit | $ (23) | [1] | $ (56) | $ (150) | [1] | $ (68) | ||
[1] | Corporate in 2019 includes the cost of certain global research and development activities that were previously included in the North America reportable segment in 2018 that totaled approximately $12 million and $24 million for the quarter and year-to-date periods, respectively. |
Reportable Segments Supplementa
Reportable Segments Supplemental Product Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2019 | Jun. 30, 2018 | Jun. 29, 2019 | Jun. 30, 2018 | |
Segment Reporting Information [Line Items] | ||||
Net sales | $ 3,461 | $ 3,360 | $ 6,983 | $ 6,761 |
Snacks | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 1,741 | 1,684 | 3,521 | 3,458 |
Cereal | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 1,256 | 1,304 | 2,531 | 2,655 |
Frozen | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 256 | 247 | 527 | 523 |
Noodles and other | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | $ 208 | $ 125 | $ 404 | $ 125 |
Consolidated Balance Sheet (U_3
Consolidated Balance Sheet (Unaudited) (Details) - USD ($) $ in Millions | Jun. 29, 2019 | Dec. 29, 2018 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Trade receivables | $ 1,409 | $ 1,163 |
Allowance for doubtful accounts | (9) | (10) |
Redundable income taxes | 18 | 28 |
Other receivables | 225 | 194 |
Accounts receivable, net | 1,643 | 1,375 |
Raw materials and supplies | 327 | 339 |
Finished goods and materials in process | 907 | 991 |
Inventories | 1,234 | 1,330 |
Property | 8,814 | 9,173 |
Accumulated depreciation | (5,288) | (5,442) |
Property, net | 3,526 | 3,731 |
Pension | 267 | 228 |
Deferred income taxes | 256 | 246 |
Other | 648 | 594 |
Other assets | 1,171 | 1,068 |
Accrued income taxes | 10 | 48 |
Accrued salaries and wages | 243 | 309 |
Accrued advertising and promotion | 603 | 557 |
Current liabilities held for sale | 1 | 0 |
Other | 552 | 502 |
Other current liabilities | 1,409 | 1,416 |
Income taxes payable | 118 | 115 |
Nonpension postretirement benefits | 36 | 34 |
Noncurrent liabilities held for sale | 4 | 0 |
Other | 330 | 355 |
Other liabilities | $ 488 | $ 504 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Millions | Jul. 28, 2019 | Mar. 31, 2019 | Jul. 24, 2019 |
Subsequent Event [Line Items] | |||
Closing costs | $ 15 | ||
Deferred tax liability | 260 | ||
Multiemployer plans, withdrawal obligation | $ 110 | ||
Multiemployer plan withdrawal obligation term | 20 years | ||
Senior Notes Due November 2019 | |||
Subsequent Event [Line Items] | |||
Debt repurchase amount | $ 500 | ||
Debt instrument interest rate stated percentage | 4.15% | ||
Senior Notes Due December 2020 | |||
Subsequent Event [Line Items] | |||
Debt repurchase amount | $ 500 | ||
Debt instrument interest rate stated percentage | 4.00% | ||
Senior Notes Due May 2021 | |||
Subsequent Event [Line Items] | |||
Debt instrument interest rate stated percentage | 3.25% | ||
Senior Notes Due May 2023 | |||
Subsequent Event [Line Items] | |||
Debt instrument interest rate stated percentage | 2.65% | ||
Senior Notes Due November 2027 | |||
Subsequent Event [Line Items] | |||
Debt instrument interest rate stated percentage | 3.40% | ||
Cookies, fruit and fruit snacks businesses | |||
Subsequent Event [Line Items] | |||
Cash proceeds from sale of businesses | $ 1,300 | $ 1,300 | |
Net assets | $ 1,300 | $ 1,300 |