EXHIBIT 99.2
NABISCO HOLDINGS CORP.
NABISCO, INC.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Dollars in Millions Except Per Share Amounts)
Nine Months Nine Months
Ended Ended
September 30, 2000 September 30, 1999
---------------------- ----------------------
Nabisco Nabisco
Holdings Nabisco Holdings Nabisco
-------- ------- -------- -------
Net sales............................................. $6,580 $6,580 $5,935 $5,935
------ ------ ------ ------
Costs and expenses:
Cost of products sold.............................. 3,594 3,594 3,249 3,249
Selling, advertising, administrative and
general expenses................................ 2,231 2,209 2,021 2,021
Amortization of trademarks and goodwill............ 165 165 161 161
Restructuring credit............................... (27) (27) (59) (59)
------ ------ ------ ------
Operating income............................. 617 639 563 563
Interest and debt expense............................. (213) (213) (193) (193)
Other income (expense), net........................... (10) (10) (22) (22)
------ ------ ------ ------
Income before income taxes.................... 394 416 348 348
Provision for income taxes............................ 158 165 130 130
------ ------ ------ ------
Net income before extraordinary item.......... 236 251 218 218
Extraordinary item--loss on early extinguishment of
debt, net of $2 million income taxes............... -- -- (3) (3)
------ ------ ------ ------
Net income.................................... $ 236 $ 251 $ 215 $ 215
====== ====== ====== ======
Basic net income (loss) per common share:
Income before extraordinary item................... $ .89 $ .82
Extraordinary item................................. -- (.01)
------ ------
Net income.................................... $ .89 $ .81
====== ======
Diluted net income (loss) per common share:
Income before extraordinary item................... $ .88 $ .82
Extraordinary item................................. -- (.01)
------ ------
Net income.................................... $ .88 $ .81
====== ======
Dividends declared per common share................... $.5625 $.5625
====== ======
Average number of common shares outstanding
(in thousands):
Basic.............................................. 264,843 264,676
======= =======
Diluted............................................ 268,001 266,867
======= =======
See Notes to Consolidated Condensed Financial Statements.
2
NABISCO HOLDINGS CORP.
NABISCO, INC.
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
(Dollars in Millions)
Three Months Three Months
Ended Ended
September 30, September 30,
2000 1999
------------------- -------------------
Nabisco Nabisco
Holdings Nabisco Holdings Nabisco
-------- ------ -------- -------
Net income......................................................... $ 78 $ 93 $ 114 $ 114
---- ---- ----- -----
Other comprehensive (loss):
Cumulative translation adjustment............................... (4) (4) (17) (17)
(Provision) benefit for income taxes............................ -- -- -- --
---- ---- ----- -----
Other comprehensive (loss), net of income tax...................... (4) (4) (17) (17)
---- ---- ----- -----
Comprehensive income............................................... $ 74 $ 89 $ 97 $ 97
==== ==== ===== =====
Nine Months Nine Months
Ended Ended
September 30, September 30,
2000 1999
------------------- -------------------
Nabisco Nabisco
Holdings Nabisco Holdings Nabisco
-------- ------ -------- -------
Net income......................................................... $236 $251 $ 215 $ 215
---- ---- ----- -----
Other comprehensive income (loss):
Reclassification of cumulative translation losses related
to businesses sold included in net income.................... 51 51 -- --
Cumulative translation adjustment............................... (31) (31) (133) (133)
(Provision) benefit for income taxes............................ -- -- -- --
---- ---- ----- -----
Other comprehensive income (loss), net of income tax............. 20 20 (133) (133)
---- ---- ----- -----
Comprehensive income............................................... $256 $271 $ 82 $ 82
==== ==== ===== =====
See Notes to Consolidated Condensed Financial Statements.
3
NABISCO HOLDINGS CORP.
NABISCO, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Dollars in Millions)
Nine Months Nine Months
Ended Ended
Sept. 30, 2000 Sept. 30, 1999
------------------ -------------------
Nabisco Nabisco
Holdings Nabisco Holdings Nabisco
-------- ------- -------- -------
Cash flows from (used in) operating activities:
Net income.................................................................. $ 236 $ 251 $ 215 $ 215
Adjustments to reconcile net income to net cash flows from operating
activities:
Depreciation of property, plant and equipment.......................... 200 200 198 198
Amortization of intangibles............................................ 165 165 161 161
Deferred income tax provision.......................................... 30 33 27 27
Restructuring credit................................................... (27) (27) (59) (59)
Restructuring payments................................................. (46) (46) (65) (65)
Accounts receivable, net............................................... 49 49 (49) (49)
Inventories............................................................ (108) (108) (184) (184)
Prepaid expenses and other current assets.............................. (8) (8) (8) (8)
Accounts payable....................................................... (259) (259) (109) (109)
Accrued liabilities.................................................... 72 53 94 89
Income taxes accrued................................................... 75 83 (21) (21)
Extraordinary loss on early retirement of debt, net.................... -- -- 3 3
Other, net............................................................. 25 25 (13) (13)
----- ----- ---- ----
Net cash flows from operating activities................................. 404 411 190 185
----- ----- ---- ----
Cash flows from (used in) investing activities:
Capital expenditures........................................................ (131) (131) (150) (150)
Proceeds from sale of assets................................................ 31 31 27 27
Acquisition of business..................................................... -- -- (107) (107)
Investment in Finalrealm transactions....................................... (151) (151) -- --
----- ----- ---- ----
Net cash flows (used in) investing activities............................ (251) (251) (230) (230)
----- ----- ---- ----
Cash flows from (used in) financing activities:
Net proceeds from the issuance of long-term debt............................ 111 111 497 497
Repayments of long-term debt................................................ (222) (222) (324) (324)
Increase (decrease) in notes payable........................................ 133 133 (8) (8)
Dividends paid on common stock.............................................. (149) (149) (146) (146)
Repurchases of Class A common stock......................................... (13) -- (12) --
Proceeds from exercise of Class A common stock options...................... 20 -- 7 --
----- ----- ---- ----
Net cash flows from (used in) financing activities....................... (120) (127) 14 19
----- ----- ---- ----
Effect of exchange rate changes on cash and cash equivalents................... (3) (3) (9) (9)
----- ----- ---- ----
Net change in cash and cash equivalents.................................. 30 30 (35) (35)
Cash and cash equivalents at beginning of period............................... 110 110 111 111
----- ----- ---- ----
Cash and cash equivalents at end of period..................................... $ 140 $ 140 $ 76 $ 76
===== ===== ==== ====
Income taxes paid, net of refunds.............................................. $ 53 $ 53 $ 126 $ 126
Interest paid.................................................................. $ 211 $ 211 $ 204 $ 204
See Notes to Consolidated Condensed Financial Statements.
4
NABISCO HOLDINGS CORP.
NABISCO, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Dollars in Millions)
September 30, 2000 December 31, 1999
------------------ -----------------
Nabisco Nabisco
Holdings Nabisco Holdings Nabisco
-------- ------- -------- -------
ASSETS
Current assets:
Cash and cash equivalents ................................................. $ 140 $ 140 $ 110 $ 110
Accounts receivable, net of allowance for doubtful accounts of $39 and $52,
respectively............................................................ 555 555 681 681
Intercompany receivable from Nabisco Holdings ............................. -- 4 -- --
Deferred income taxes ..................................................... 111 111 116 116
Inventories ............................................................... 951 951 898 898
Prepaid expenses and other current assets ................................. 72 72 79 79
------- ------- ------- -------
Total current assets ................................................. 1,829 1,833 1,884 1,884
------- ------- ------- -------
Property, plant and equipment--at cost ....................................... 4,997 4,997 5,053 5,053
Less accumulated depreciation ................................................ (2,055) (2,055) (1,966) (1,966)
------- ------- ------- -------
Net property, plant and equipment ......................................... 2,942 2,942 3,087 3,087
------- ------- ------- -------
Trademarks, net of accumulated amortization of $1,298 and $1,197, respectively 3,343 3,343 3,443 3,443
Goodwill, net of accumulated amortization of $1,060 and $1,023, respectively.. 3,045 3,045 3,159 3,159
Other assets and deferred charges ............................................ 451 451 134 134
------- ------- ------- -------
$11,610 $11,614 $11,707 $11,707
======= ======= ======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable ............................................................. $ 80 $ 80 $ 39 $ 39
Accounts payable .......................................................... 359 359 642 642
Accrued liabilities ....................................................... 1,089 1,040 1,020 970
Intercompany payable to Nabisco Holdings .................................. -- -- -- 7
Current maturities of long-term debt ...................................... 100 100 158 158
Income taxes accrued ...................................................... 173 181 104 104
------- ------- ------- -------
Total current liabilities ............................................ 1,801 1,760 1,963 1,920
------- ------- ------- -------
Long-term debt (less current maturities) ..................................... 3,834 3,834 3,892 3,892
Other noncurrent liabilities ................................................. 783 780 744 744
Deferred income taxes ........................................................ 1,143 1,143 1,176 1,176
Stockholders' equity:
Class A common stock (51,819,593 and 51,412,707 shares issued and
outstanding at September 30, 2000 and December 31, 1999, respectively).. 1 -- 1 --
Class B common stock (213,250,000 shares issued and outstanding at
September 30, 2000 and December 31, 1999)............................... 2 -- 2 --
Paid-in capital ........................................................... 4,097 4,141 4,093 4,141
Retained earnings ......................................................... 224 229 148 127
Accumulated other comprehensive income (loss) ............................. (273) (273) (293) (293)
Treasury stock, at cost ................................................... -- -- (17) --
Notes receivable on common stock purchases ................................ (2) -- (2) --
------- ------- ------- -------
Total stockholders' equity ........................................... 4,049 4,097 3,932 3,975
------- ------- ------- -------
$11,610 $11,614 $11,707 $11,707
======= ======= ======= =======
See Notes to Consolidated Condensed Financial Statements.
5
NABISCO HOLDINGS CORP.
NABISCO, INC.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
Note 1--Interim Reporting and Results of Operations
General
For interim reporting purposes, certain costs and expenses are charged
to operations in proportion to the estimated total annual amount expected to be
incurred. The results for the three and nine months ended September 30, 2000 are
not necessarily indicative of the results to be expected for the year ended
December 31, 2000.
In management's opinion, the accompanying unaudited consolidated
condensed financial statements (the "Consolidated Condensed Financial
Statements") of Nabisco Holdings Corp. ("Nabisco Holdings") and Nabisco, Inc.
("Nabisco" together with Nabisco Holdings, the "Companies") contain all
adjustments, consisting only of normal recurring adjustments, necessary for a
fair statement of the results for the interim periods presented. The
Consolidated Condensed Financial Statements should be read in conjunction with
the consolidated financial statements and footnotes included in the Annual
Report on Form 10-K of Nabisco Holdings and Nabisco, as amended, for the year
ended December 31, 1999.
Certain prior period amounts have been reclassified to conform to the
current period presentation.
Business Disposals
In April 2000, Nabisco joined Finalrealm Limited ("Finalrealm"), a
consortium of investors, which acquired the equity of United Biscuits (Holdings)
plc ("UB"), a United Kingdom company. At that time, Nabisco invested
approximately $45 million in cash in DeluxeStar Limited ("DeluxeStar"), an
affiliate of Finalrealm. In July 2000, Nabisco sold its operations in Spain,
Portugal and the Middle East, which included $10 million in cash and cash
equivalents, to DeluxeStar and agreed to pay an additional $41 million in cash
to Finalrealm. In exchange for the total cash consideration and businesses sold,
Nabisco received mandatorily redeemable discounted preferred stock from
DeluxeStar and warrants from Bladeland Limited ("Bladeland"), the indirect
parent company of Finalrealm and DeluxeStar. The discounted preferred stock and
warrants were fair valued at approximately $277 million based on a valuation
opinion received from an independent investment banker. The discounted preferred
stock accretes non-cash dividend income at an annual rate of 11.72% and is
mandatorily redeemable in 2049. The discounted preferred stock converts into
26.51% of the common equity of Bladeland upon the future exercise of the
warrants. The warrants are exercisable at maturity, which is in 25 years, upon
an initial public offering by Bladeland, or upon a change of control in
Bladeland, in which the ownership of the equity investors becomes less than 50%.
These securities are being accounted for on a cost basis.
The sale of operations resulted in the recognition of a pre-and-after
tax loss of approximately $18 million that was recorded in selling, advertising,
administrative and general expenses in the quarter ended June 30, 2000. In 1999,
these operations had annual net sales of approximately $290 million.
As a result of the transaction, Nabisco recorded $12 million of
investor financing fee income during the third quarter of 2000 in other income
(expense), net.
Business Acquisitions
In July 2000, Nabisco acquired UB's operations in China, Hong Kong and
Taiwan for approximately $99 million as part of its agreement to join the
consortium of investors discussed above. In 1999, these operations had annual
net sales of approximately $66 million.
6
Note 1--Interim Reporting and Results of Operations (Continued)
In November 1999, Nabisco acquired certain assets and liabilities of
Favorite Brands International, Inc., a company operating under Chapter 11 of
Title 11 of the U.S. Code. As of June 30, 2000, the purchase price allocation
was completed and resulted in total goodwill of $106 million, an increase of $38
million from December 31, 1999. The after-tax net increase in goodwill consisted
of:
(in millions)
- -------------
Fair value adjustments to:
Property, plant and equipment.............................. $16
Certain working capital items.............................. 12
Severance accruals............................................ 5
Contract exit cost accruals................................... 5
---
$38
===
Recently Issued Accounting Pronouncements
During the second quarter of 1998, the Financial Accounting Standards
Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS")
No. 133, Accounting for Derivative Instruments and Hedging Activities.
SFAS No. 133 requires that all derivative instruments be recorded on the
consolidated balance sheet at their fair value. Changes in the fair value of
derivatives will be recorded each period in earnings or other comprehensive
income, depending on whether a derivative is designated as part of a hedge
transaction and, if it is, the type of hedge transaction. Nabisco Holdings and
Nabisco will adopt SFAS 133, as amended, on January 1, 2001 but have not yet
determined the impact that such adoption or subsequent application will have on
their financial position or results of operations.
In December 1999, The Securities and Exchange Commission issued Staff
Accounting Bulletin ("SAB") No. 101, Revenue Recognition in Financial
Statements. Nabisco Holdings and Nabisco are required to adopt SAB No. 101, as
amended, in the fourth quarter of 2000. SAB No. 101 provides additional guidance
on revenue recognition, as well as criteria for when certain revenue is
generally realized and earned, and also requires the deferral of incremental
direct selling costs. Nabisco Holdings and Nabisco have determined that the
impact of adoption or subsequent application of SAB No. 101 will not have a
material effect on their financial positions or results of operations.
During the second quarter 2000, the Emerging Issues Task Force ("EITF")
issued EITF Issue No. 00-14, Accounting for Certain Sales Incentives. EITF
No. 00-14 addresses the recognition, measurement and statement of income
classification of various sales incentives and will be effective for the fourth
quarter of 2000. Nabisco Holdings and Nabisco have determined that the impact of
adoption will be a reduction of approximately 1% to 2% on their net sales, with
no impact on either company's net income. Certain sales incentives, principally
for consumer coupon redemption expenses, currently included in selling,
advertising, administrative and general expenses will be reclassified as a
reduction of net sales and, upon adoption, prior period amounts will be restated
for comparative purposes.
In September 2000, the FASB issued SFAS No. 140, Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of Liabilities,
which replaced SFAS No. 125, Accounting for Transfers and Servicing of Financial
Assets and Extinguishments of Liabilities. This statement revises the standards
for accounting for securitizations and other transfers of financial assets and
collateral and requires certain disclosures, but it carries over most of SFAS
No. 125's provisions without reconsideration. Nabisco Holdings and Nabisco will
adopt SFAS No. 140 for transactions occurring after March 31, 2001. Nabisco
Holdings and Nabisco have not yet determined the impact that such adoption or
subsequent application will have on their financial positions or results of
operations.
7
Note 1--Interim Reporting and Results of Operations (Continued)
1998 Restructuring Charges
In the second and fourth quarters of 1998, Nabisco recorded
restructuring charges of $406 million ($268 million after tax) and $124 million
($94 million after tax), respectively. In the second quarter of 2000, Nabisco
recorded a net reduction of $27 million in the previously recorded restructuring
expense due to higher than anticipated proceeds from assets sold and lower than
anticipated spending primarily in severance programs. This restructuring credit
combined with the $67 million net restructuring credit recorded in 1999 resulted
in a total net charge for the 1998 restructuring programs of $436 million ($296
million after tax). These restructuring programs were undertaken to streamline
operations and improve profitability and have resulted in the elimination of
approximately 6,900 employee positions.
The June 1998 program was completed in 1999 and the December 1998
program was completed as of June 30, 2000.
The key elements of the restructuring programs were:
Severance Contract Asset Other Exit
In Millions and Benefits Terminations Impairments Costs Total
- ----------- ------------ ------------ ----------- ---------- -----
Sales force reorganizations.................... $ 37 $ 3 $ -- $ -- $ 40
Distribution reorganizations................... 16 8 9 -- 33
Staff reductions............................... 83 -- 3 -- 86
Manufacturing costs reduction initiatives...... 22 -- 8 -- 30
Plant closures................................. 46 3 217 15 281
Product line rationalizations.................. 4 4 20 32 60
----- ---- ----- ---- -----
Total 1998 restructuring reserves........ 208 18 257 47 530
1999 net restructuring credit.................. (50) 1 (14) (4) (67)
2000 net restructuring credit.................. (4) (3) (21) 1 (27)
----- ---- ----- ---- -----
Total program reserves................... 154 16 222 44 436
----- ---- ----- ---- -----
Charges and Payments:
Cumulative through December 31, 1999........... (132) (14) (233) (35) (414)
Six months ended June 30, 2000................. (22) (2) 11 (9) (22)
----- ---- ----- ---- -----
Total charges and payments, net of cash
proceeds.............................. (154) (16) (222) (44) (436)
----- ---- ----- ---- -----
Program reserves as of June 30, 2000........... $ -- $ -- $ -- $ -- $ --
===== ==== ===== ==== =====
The key elements of the restructuring programs, after the restructuring
credits of $94 million were:
Severance Contract Asset Other Exit
In Millions and Benefits Terminations Impairments Costs Total
- ----------- ------------ ------------ ----------- ---------- -----
Sales force reorganizations..................... $ 16 $ 3 $ -- $-- $ 19
Distribution reorganizations.................... 10 4 (2) -- 12
Staff reductions................................ 56 1 3 -- 60
Manufacturing costs reduction initiatives....... 19 -- 8 -- 27
Plant closures.................................. 51 3 192 15 261
Product line rationalizations................... 2 5 21 29 57
---- --- ---- --- ----
Total restructuring charges............... $154 $16 $222 $44 $436
==== === ==== === ====
Total charges and payments include net cash expenditures, non-cash
charges primarily for asset impairments and committed severance and benefits to
be paid. The total cash payments, net of cash proceeds applied against the
restructuring reserves totaled $122 million, which is comprised of
8
Note 1--Interim Reporting and Results of Operations (Continued)
cumulative cash expenditures of $170 million and cumulative cash proceeds of $48
million. For the nine months ended September 30, 2000, cash payments, net of
cash proceeds totaled $19 million, which is comprised of $46 million of cash
expenditures and $27 million of cash proceeds which were applied against the
restructuring reserves. Although projects have been completed, proceeds to be
collected and certain cash payments, primarily severance and benefits that are
paid over time, are being transacted after the program completion dates. This is
expected to result in a net cash inflow of approximately $7 million subsequent
to September 30, 2000.
Note 2--Change of Control
On June 25, 2000, the board of directors of Nabisco Group Holdings
Corp. ("NGH") approved two major transactions: (1) the sale of NGH's 80.5%
interest in Nabisco Holdings to Philip Morris Companies, Inc. (the "Nabisco
Sale") pursuant to a merger in which Philip Morris will acquire all of the
outstanding Nabisco Holdings common stock for $55 per share (the "Nabisco
Holdings merger"), and (2) the subsequent acquisition of NGH by R.J. Reynolds
Tobacco Holdings, Inc. ("RJR") pursuant to a merger in which RJR will acquire
all of the outstanding NGH common stock for $30 per share (the "NGH merger").
Completion of the Nabisco Holdings merger is subject to customary closing
conditions, including receipt of regulatory approvals. Completion of the NGH
merger is also subject to customary closing conditions, including receipt of
regulatory approvals and is conditioned on the completion of the Nabisco Sale.
There can be no assurance that such approvals will be obtained. On October 27,
2000 the stockholders of NGH approved the acquisition of Nabisco Holdings by
Philip Morris and the subsequent acquisition of NGH by RJR as discussed in
Note 5--Subsequent Events. The transactions are expected to close during the
fourth quarter of 2000.
The sale of Nabisco Holdings requires approval by holders of a majority
of the outstanding shares of NGH common stock because the Nabisco Holdings
shares constitute substantially all of the assets of NGH. NGH has entered into a
voting and indemnity agreement with Philip Morris with respect to the sale of
Nabisco Holdings which generally provides that, subject to receiving approval of
the sale of Nabisco Holdings from NGH stockholders, NGH will promptly vote in
favor of the Nabisco Holdings merger. The approval by NGH, as discussed above,
is the only Nabisco Holdings stockholder approval required to complete the
Nabisco Holdings merger.
All costs and expenses incurred in connection with the Nabisco Holdings
merger agreement and related transactions will be paid by the company incurring
such costs or expenses, except that Nabisco Holdings and NGH have agreed that
Nabisco Holdings will be responsible for fees and expenses of the financial,
legal and other advisors to Nabisco Holdings and NGH up to $50 million, and NGH
will be responsible for all such fees and expenses in excess of $50 million.
In connection with the Nabisco Holdings merger and the NGH merger,
Nabisco Holdings incurred costs during the third quarter of 2000 of $21 million
for financial, legal and other advisor fees. In addition, in accordance with the
terms of the Nabisco Holdings merger agreement, and upon depletion of its
existing treasury stock inventory, Nabisco Holdings paid cash to satisfy the
excess of the market price of Nabisco Holdings stock at the time of exercise,
over the exercise price of Nabisco Holdings stock options. As a result, Nabisco
Holdings and Nabisco recognized compensation expense of $28 million during the
third quarter and first nine months of 2000. These costs have been classified as
selling, advertising, administrative and general expenses in the accompanying
Consolidated Condensed Statements of Income.
9
Note 3--Inventories
The major classes of inventory are shown in the table below:
September 30, December 31,
In Millions 2000 1999
- ----------- ------------ -----------
Finished products................................. $605 $551
Raw materials..................................... 211 199
Work in process................................... 32 45
Other............................................. 103 103
---- ----
$951 $898
==== ====
Note 4--Segment Reporting
Nabisco Holdings is a holding company whose subsidiaries are engaged in
the manufacture, distribution and sale of cookies, crackers and other food
products. Nabisco Holdings is organized and reports its results of operations in
three business segments: Nabisco Biscuit Company, the Nabisco Foods Company and
the International Food Group which are segregated by both product and geographic
area.
The Company evaluates performance and allocates resources based on
operating company contribution ("OCC"). OCC for each reportable segment is
operating income before amortization of intangibles and exclusive of a
restructuring credit, loss on sale of businesses, restructuring-related expenses
and costs associated with the Nabisco Holdings merger and the NGH merger. Such
costs include the cash buyout of exercised Nabisco Holdings stock options and
financial, legal and other advisor fees.
Three Months Nine Months
Ended September 30, Ended September 30,
--------------------- --------------------
In Millions 2000 1999 2000 1999
- ----------- ------ ------ ------ ------
Net sales from external customers:
Nabisco Biscuit Company................................. $ 962 $ 924 $2,779 $2,688
Nabisco Foods Company................................... 748 545 2,112 1,527
International Food Group................................ 543 588 1,689 1,720
------ ------ ------ ------
Total.............................................. $2,253 $2,057 $6,580 $5,935
====== ====== ====== ======
Segment operating company contribution:
Nabisco Biscuit Company................................. $ 161 $ 136 $ 439 $ 386
Nabisco Foods Company................................... 100 74 271 196
International Food Group................................ 40 49 112 129
------ ------ ------ ------
Total segment operating company contribution............... 301 259 822 711
Cash buyout of exercised Nabisco Holdings stock options.... (28) -- (28) --
Financial, legal and other advisor fees.................... (21) -- (21) --
Loss on sale of businesses................................. -- -- (18) --
Restructuring credit....................................... -- 59 27 59
Restructuring-related expenses............................. -- (12) -- (46)
Amortization of trademarks and goodwill.................... (55) (54) (165) (161)
------ ------ ------ ------
Consolidated operating income.............................. 197 252 617 563
Interest and debt expense.................................. (71) (64) (213) (193)
Other income (expense), net................................ 1 (7) (10) (22)
------ ------ ------ ------
Income before income taxes................................. $ 127 $ 181 $ 394 $ 348
====== ====== ====== ======
10
Note 5--Subsequent Events
On October 27, 2000, the stockholders of NGH approved the acquisition
of Nabisco Holdings by Philip Morris and the subsequent acquisition of NGH
by RJR.
In November 2000, Nabisco signed definitive agreements for the sale of
its domestic breath mints, gum, dry mix dessert and baking powder businesses.
These transactions are conditioned on completion of the acquisition of Nabisco
Holdings by Philip Morris, and are subject to customary closing conditions,
including receipt of regulatory approvals. In 1999, these businesses had net
sales and operating income of approximately $314 million and $96 million,
respectively.
11