Item 6. SELECTED FINANCIAL DATA

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Item 6. SELECTED FINANCIAL DATA

FIVE-YEAR FINANCIAL SUMMARY



in millions, except per share and ratio data
	2014			2013			2012			2011			2010
Summary of Operations
Sales	$	37,580		$	34,374		$	33,055		$	32,032		$	28,212
Operating income	1,430			1,375			1,286			1,289			1,574
Net interest expense	125			138			344			231			333
Income from continuing operations	856			848			614			738			783
Loss from discontinued operation, net of tax	—			(70		)	(38		)	(5		)	(18		)
Net income	856			778			576			733			765
Net income attributable to Tyson	864			778			583			750			780
Diluted net income per share attributable to Tyson:
Income from continuing operations	2.37			2.31			1.68			1.98			2.09
Loss from discontinued operation	—			(0.19		)	(0.10		)	(0.01		)	(0.03		)
Net income	2.37			2.12			1.58			1.97			2.06
Dividends declared per share:
Class A	0.325			0.310			0.160			0.160			0.160
Class B	0.294			0.279			0.144			0.144			0.144
Balance Sheet Data
Cash and cash equivalents	$	438		$	1,145		$	1,071		$	716		$	978
Total assets	23,956			12,177			11,896			11,071			10,752
Total debt	8,178			2,408			2,432			2,182			2,536
Shareholders’ equity	8,904			6,233			6,042			5,685			5,201
Other Key Financial Measures
Depreciation and amortization	$	530		$	519		$	499		$	506		$	497
Capital expenditures	632			558			690			643			550
EBITDA	1,897			1,818			1,731			1,767			1,987
Return on invested capital	11.8		%	18.5		%	17.7		%	18.5		%	23.0		%
Effective tax rate for continuing operations	31.6		%	32.6		%	36.4		%	31.6		%	35.9		%
Total debt to capitalization	47.9		%	27.9		%	28.7		%	27.7		%	32.8		%
Book value per share	$	23.70		$	18.13		$	16.84		$	15.38		$	13.78
Stock price high	44.24			32.40			21.06			20.12			20.57
Stock price low	27.33			15.93			14.07			14.59			11.91

Notes to Five-Year Financial Summary


a.	Fiscal 2014 included a $42 million pretax impairment charge and other costs related to the sale of our Brazil operation and Mexico's undistributed earnings tax, $197 million pretax expense related to the Hillshire Brands acquisition, integration and costs associated with our Prepared Foods improvement plan, $40 million pretax expense related to the Hillshire Brands post-closing results, purchase price accounting, and ongoing plant related legacy Hillshire Brands fire costs, $27 million pretax expense related to the Hillshire Brands acquisition financing incremental interest cost and $52 million unrecognized tax benefit gain.

Fiscal 2014 included a $42 million pretax impairment charge and other costs related to the sale of our Brazil operation and Mexico's undistributed earnings tax, $197 million pretax expense related to the Hillshire Brands acquisition, integration and costs associated with our Prepared Foods improvement plan, $40 million pretax expense related to the Hillshire Brands post-closing results, purchase price accounting, and ongoing plant related legacy Hillshire Brands fire costs, $27 million pretax expense related to the Hillshire Brands acquisition financing incremental interest cost and $52 million unrecognized tax benefit gain.


b.	Fiscal 2013 included a $19 million currency translation adjustment gain recognized in conjunction with the receipt of proceeds constituting the final resolution of our investment in Canada.


c.	During fiscal 2013 we determined our Weifang operation (Weifang) was no longer core to the execution of our strategy in China. In July 2013, we completed the sale of Weifang. Non-cash charges related to the impairment of assets in Weifang amounted to $56 million and $15 million in fiscal 2013 and 2012, respectively.


d.	Fiscal 2012 included a pretax charge of $167 million related to the early extinguishment of debt.


e.	Fiscal 2011 included an $11 million non-operating gain related to the sale of interest in an equity method investment and a $21 million reduction to income tax expense related to a reversal of reserves for foreign uncertain tax positions.


f.	Fiscal 2010 included $61 million of interest expense related to losses on notes repurchased/redeemed during fiscal 2010, a $29 million non-tax deductible charge related to a full goodwill impairment related to an immaterial Chicken segment reporting unit and a $12 million non-operating charge related to the partial impairment of an equity method investment. Additionally, fiscal 2010 included insurance proceeds received of $38 million related to Hurricane Katrina.

Fiscal 2010 included $61 million of interest expense related to losses on notes repurchased/redeemed during fiscal 2010, a $29 million non-tax deductible charge related to a full goodwill impairment related to an immaterial Chicken segment reporting unit and a $12 million non-operating charge related to the partial impairment of an equity method investment. Additionally, fiscal 2010 included insurance proceeds received of $38 million related to Hurricane Katrina.


g.	Return on invested capital is calculated by dividing operating income by the sum of the average of beginning and ending total debt and shareholders’ equity less cash and cash equivalents.


h.	For the total debt to capitalization calculation, capitalization is defined as total debt plus total shareholders’ equity.


i.	"EBITDA" is defined as net income less interest income, plus interest, taxes, depreciation and amortization.

EBITDA RECONCILIATIONS

A reconciliation of net income to EBITDA is as follows:



in millions, except ratio data
	2014			2013			2012			2011			2010

Net income	$	856		$	778		$	576		$	733		$	765
Less: Interest income	(7		)	(7		)	(12		)	(11		)	(14		)
Add: Interest expense	132			145			356			242			347
Add: Income tax expense (a)	396			411			351			341			438
Add: Depreciation	494			474			443			433			416
Add: Amortization (b)	26			17			17			29			35
EBITDA	$	1,897		$	1,818		$	1,731		$	1,767		$	1,987


Total gross debt	$	8,178		$	2,408		$	2,432		$	2,182		$	2,536
Less: Cash and cash equivalents	(438		)	(1,145		)	(1,071		)	(716		)	(978		)
Less: Short-term investments	(1		)	(1		)	(3		)	(2		)	(2		)
Total net debt	$	7,739		$	1,262		$	1,358		$	1,464		$	1,556

Ratio Calculations:
Gross debt/EBITDA	4.3x			1.3x			1.4x			1.2x			1.3x
Net debt/EBITDA	4.1x			0.7x			0.8x			0.8x			0.8x


(a)	Includes income tax expense of discontinued operation.


(b)	Excludes the amortization of debt discount expense of $10 million, $28 million, $39 million, $44 million and $46 million for fiscal 2014, 2013, 2012, 2011 and 2010, respectively, as it is included in Interest expense.

EBITDA represents net income, net of interest, income tax and depreciation and amortization. Net debt to EBITDA represents the ratio of our debt, net of cash and short-term investments, to EBITDA. EBITDA and net debt to EBITDA are presented as supplemental financial measurements in the evaluation of our business. We believe the presentation of these financial measures helps investors to assess our operating performance from period to period, including our ability to generate earnings sufficient to service our debt, and enhances understanding of our financial performance and highlights operational trends. These measures are widely used by investors and rating agencies in the valuation, comparison, rating and investment recommendations of companies; however, the measurements of EBITDA and net debt to EBITDA may not be comparable to those of other companies, which limits their usefulness as comparative measures. EBITDA and net debt to EBITDA are not measures required by or calculated in accordance with generally accepted accounting principles (GAAP) and should not be considered as substitutes for net income or any other measure of financial performance reported in accordance with GAAP or as a measure of operating cash flow or liquidity. EBITDA is a useful tool for assessing, but is not a reliable indicator of, our ability to generate cash to service our debt obligations because certain of the items added to net income to determine EBITDA involve outlays of cash. As a result, actual cash available to service our debt obligations will be different from EBITDA. Investors should rely primarily on our GAAP results, and use non-GAAP financial measures only supplementally, in making investment decisions.

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