2023 Q1 Form 10-K Financial Statement

#000163745923000009 Filed on February 16, 2023

View on sec.gov

Income Statement

Concept 2023 Q1 2022 Q4 2022
Revenue $7.381B $26.49B
YoY Change 10.02% 1.7%
Cost Of Revenue $5.005B $18.36B
YoY Change 10.39% 5.78%
Gross Profit $2.376B $8.122B
YoY Change 9.24% -6.45%
Gross Profit Margin 32.19% 30.67%
Selling, General & Admin $1.128B $4.488B
YoY Change 29.8% -14.06%
% of Gross Profit 47.47% 55.26%
Research & Development $127.0M
YoY Change -9.29%
% of Gross Profit 1.56%
Depreciation & Amortization $248.0M $933.0M
YoY Change 6.44% 2.53%
% of Gross Profit 10.44% 11.49%
Operating Expenses $1.128B $4.615B
YoY Change 29.8% -13.93%
Operating Profit $1.248B $3.634B
YoY Change -4.44% 5.03%
Interest Expense -$211.0M $921.0M
YoY Change -64.18% -55.01%
% of Operating Profit -16.91% 25.34%
Other Income/Expense, Net $12.00M $253.0M
YoY Change -78.95% -14.24%
Pretax Income $1.051B $2.966B
YoY Change -302.12% 73.65%
Income Tax $164.0M $598.0M
% Of Pretax Income 15.6% 20.16%
Net Earnings $890.0M $2.363B
YoY Change -446.3% 133.5%
Net Earnings / Revenue 12.06% 8.92%
Basic Earnings Per Share $1.93
Diluted Earnings Per Share $0.72 $1.91
COMMON SHARES
Basic Shares Outstanding 1.225B shares 1.225B shares 1.226B shares
Diluted Shares Outstanding 1.235B shares

Balance Sheet

Concept 2023 Q1 2022 Q4 2022
SHORT-TERM ASSETS
Cash & Short-Term Investments $1.040B $1.040B
YoY Change -69.81% -69.81%
Cash & Equivalents $1.040B $1.040B
Short-Term Investments
Other Short-Term Assets $842.0M $1.086B
YoY Change 17.6% 25.84%
Inventory $3.651B $3.651B
Prepaid Expenses $240.0M
Receivables $2.120B $2.120B
Other Receivables $0.00 $0.00
Total Short-Term Assets $7.897B $7.897B
YoY Change -12.2% -12.2%
LONG-TERM ASSETS
Property, Plant & Equipment $6.740B $7.408B
YoY Change -0.97% 0.45%
Goodwill $30.80B
YoY Change -1.58%
Intangibles $42.65B
YoY Change -2.05%
Long-Term Investments
YoY Change
Other Assets $2.394B $1.726B
YoY Change -13.13% -21.08%
Total Long-Term Assets $82.62B $82.62B
YoY Change -2.11% -2.11%
TOTAL ASSETS
Total Short-Term Assets $7.897B $7.897B
Total Long-Term Assets $82.62B $82.62B
Total Assets $90.51B $90.51B
YoY Change -3.08% -3.08%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $4.848B $4.848B
YoY Change 2.0% 2.0%
Accrued Expenses $1.013B $1.138B
YoY Change -5.5% -5.56%
Deferred Revenue
YoY Change
Short-Term Debt $6.000M $6.000M
YoY Change -57.14% -57.14%
Long-Term Debt Due $831.0M $831.0M
YoY Change 12.3% 12.3%
Total Short-Term Liabilities $9.028B $9.028B
YoY Change -0.4% -0.4%
LONG-TERM LIABILITIES
Long-Term Debt $19.23B $19.23B
YoY Change -8.68% -8.68%
Other Long-Term Liabilities $1.609B $3.230B
YoY Change 4.35% -1.55%
Total Long-Term Liabilities $1.609B $22.46B
YoY Change 4.35% -7.72%
TOTAL LIABILITIES
Total Short-Term Liabilities $9.028B $9.028B
Total Long-Term Liabilities $1.609B $22.46B
Total Liabilities $41.64B $41.84B
YoY Change -5.23% -5.13%
SHAREHOLDERS EQUITY
Retained Earnings $489.0M
YoY Change -129.07%
Common Stock $12.00M
YoY Change 0.0%
Preferred Stock
YoY Change
Treasury Stock (at cost) $847.0M
YoY Change 44.29%
Treasury Stock Shares 18.00M shares
Shareholders Equity $48.68B $48.68B
YoY Change
Total Liabilities & Shareholders Equity $90.51B $90.51B
YoY Change -3.08% -3.08%

Cashflow Statement

Concept 2023 Q1 2022 Q4 2022
OPERATING ACTIVITIES
Net Income $890.0M $2.363B
YoY Change -446.3% 133.5%
Depreciation, Depletion And Amortization $248.0M $933.0M
YoY Change 6.44% 2.53%
Cash From Operating Activities $952.0M $2.469B
YoY Change -67.35% -53.97%
INVESTING ACTIVITIES
Capital Expenditures $284.0M $916.0M
YoY Change -213.6% 1.22%
Acquisitions $481.0M
YoY Change 550.0%
Other Investing Activities $231.0M -$10.00M
YoY Change -85.04% -67.74%
Cash From Investing Activities -$53.00M -$1.091B
YoY Change -104.1% -127.02%
FINANCING ACTIVITIES
Cash Dividend Paid $1.960B
YoY Change 0.05%
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net $1.465B
YoY Change -76.38%
Cash From Financing Activities -903.0M -$3.714B
YoY Change -70.01% -60.25%
NET CHANGE
Cash From Operating Activities 952.0M $2.469B
Cash From Investing Activities -53.00M -$1.091B
Cash From Financing Activities -903.0M -$3.714B
Net Change In Cash -4.000M -$2.405B
YoY Change -100.33% -8689.29%
FREE CASH FLOW
Cash From Operating Activities $952.0M $2.469B
Capital Expenditures $284.0M $916.0M
Free Cash Flow $668.0M $1.553B
YoY Change -78.9% -65.17%

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Basis of Presentation<div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Organization</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">On July 2, 2015 (the “2015 Merger Date”), through a series of transactions, we consummated the merger of Kraft Foods Group, Inc. (“Kraft”) with and into a wholly-owned subsidiary of H.J. Heinz Holding Corporation (“Heinz”) (the “2015 Merger”). At the closing of the 2015 Merger, Heinz was renamed The Kraft Heinz Company. Before the consummation of the 2015 Merger, Heinz was controlled by Berkshire Hathaway Inc. and 3G Global Food Holdings, LP, following their acquisition of H. J. Heinz Company on June 7, 2013 (the “2013 Heinz Acquisition”).</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">We operate on a 52- or 53-week fiscal year ending on the last Saturday in December in each calendar year. Unless the context requires otherwise, references to years and quarters contained herein pertain to our fiscal years and fiscal quarters. Our 2022 fiscal year was a 53-week period that ended on December 31, 2022, our 2021 fiscal year was a 52-week period that ended on December 25, 2021, and our 2020 fiscal year was a 52-week period that ended on December 26, 2020.</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Principles of Consolidation</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The consolidated financial statements include The Kraft Heinz Company and all of our controlled subsidiaries. All intercompany transactions are eliminated.</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Reportable Segments</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">In the second quarter of 2022, our internal reporting and reportable segments changed. We combined our United States and Canada zones to form the North America zone as a result of previously announced organizational changes, which are intended to advance and support our long-term growth plans by streamlining and synergizing our United States and Canada businesses. Subsequently, we manage and report our operating results through two reportable segments defined by geographic region: North America and International. We have reflected this change in all historical periods presented.</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Use of Estimates</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which requires us to make accounting policy elections, estimates, and assumptions that affect the reported amount of assets, liabilities, reserves, and expenses. These accounting policy elections, estimates, and assumptions are based on our best estimates and judgments. We evaluate our policy elections, estimates, and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. We believe these estimates to be reasonable given the current facts available. We adjust our policy elections, estimates, and assumptions when facts and circumstances dictate. Market volatility, including foreign currency exchange rates, increases the uncertainty inherent in our estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from estimates. If actual amounts differ from estimates, we include the revisions in our consolidated results of operations in the period the actual amounts become known. Historically, the aggregate differences, if any, between our estimates and actual amounts in any year have not had a material effect on our consolidated financial statements.</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Reclassifications</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">We made reclassifications and adjustments to certain previously reported financial information to conform to our current period presentation.</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Held for Sale</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">At December 31, 2022, we classified certain assets as held for sale in our consolidated balance sheet, primarily relating to land use rights across the globe. At December 25, 2021, we classified certain assets as held for sale in our consolidated balance sheet, including inventory in our International segment and certain manufacturing equipment and land use rights across the globe.</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Cash</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">,</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%"> Cash</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%"> </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Equivalents</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">, </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">and</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%"> </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Restricted</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%"> </span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Cash</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Cash equivalents include term deposits with banks, money market funds, and all highly liquid investments with original maturities of three months or less. The fair value of cash equivalents approximates the carrying amount. Cash and cash equivalents that are legally restricted as to withdrawal or usage are classified in other current assets or other non-current assets, as applicable, on the consolidated balance sheets. Restricted cash recorded in other non-current assets was $1 million at December 31, 2022 and $1 million at December 25, 2021. Total cash, cash equivalents, and restricted cash was $1,041 million at December 31, 2022 and $3,446 million at December 25, 2021.</span></div>
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We operate on a 52- or 53-week fiscal year ending on the last Saturday in December in each calendar year. Unless the context requires otherwise, references to years and quarters contained herein pertain to our fiscal years and fiscal quarters. Our 2022 fiscal year was a 53-week period that ended on December 31, 2022, our 2021 fiscal year was a 52-week period that ended on December 25, 2021, and our 2020 fiscal year was a 52-week period that ended on December 26, 2020.
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<div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Use of Estimates</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which requires us to make accounting policy elections, estimates, and assumptions that affect the reported amount of assets, liabilities, reserves, and expenses. These accounting policy elections, estimates, and assumptions are based on our best estimates and judgments. We evaluate our policy elections, estimates, and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. We believe these estimates to be reasonable given the current facts available. We adjust our policy elections, estimates, and assumptions when facts and circumstances dictate. Market volatility, including foreign currency exchange rates, increases the uncertainty inherent in our estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from estimates. If actual amounts differ from estimates, we include the revisions in our consolidated results of operations in the period the actual amounts become known. Historically, the aggregate differences, if any, between our estimates and actual amounts in any year have not had a material effect on our consolidated financial statements.</span></div>
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<div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:700;line-height:120%">Reclassifications</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">We made reclassifications and adjustments to certain previously reported financial information to conform to our current period presentation.</span></div>
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Files In Submission

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