in millions, except per share, percentage and ratio data
2015
2014
2013
2012
2011
Summary of Operations
Sales
$
41,373
$
37,580
$
34,374
$
33,055
$
32,032
Operating income
2,169
1,430
1,375
1,286
1,289
Net interest expense
284
125
138
344
231
Income from continuing operations
1,224
856
848
614
738
Loss from discontinued operation, net of tax
—
—
(70
)
(38
)
(5
)
Net income
1,224
856
778
576
733
Net income attributable to Tyson
1,220
864
778
583
750
Diluted net income per share attributable to Tyson:
Income from continuing operations
2.95
2.37
2.31
1.68
1.98
Loss from discontinued operation
—
—
(0.19
)
(0.10
)
(0.01
)
Net income
2.95
2.37
2.12
1.58
1.97
Dividends declared per share:
Class A
0.425
0.325
0.310
0.160
0.160
Class B
0.383
0.294
0.279
0.144
0.144
Balance Sheet Data
Cash and cash equivalents
$
688
$
438
$
1,145
$
1,071
$
716
Total assets
23,004
23,956
12,177
11,896
11,071
Total debt
6,725
8,178
2,408
2,432
2,182
Shareholders’ equity
9,706
8,904
6,233
6,042
5,685
Other Key Financial Measures
Depreciation and amortization
$
711
$
530
$
519
$
499
$
506
Capital expenditures
854
632
558
690
643
EBITDA
2,906
1,897
1,818
1,731
1,767
Return on invested capital
13.4
%
11.8
%
18.5
%
17.7
%
18.5
%
Effective tax rate for continuing operations
36.3
%
31.6
%
32.6
%
36.4
%
31.6
%
Total debt to capitalization
40.9
%
47.9
%
27.9
%
28.7
%
27.7
%
Book value per share
$
23.36
$
23.70
$
18.13
$
16.84
$
15.38
Stock price high
45.10
44.24
32.40
21.06
20.12
Stock price low
37.02
27.33
15.93
14.07
14.59
Notes to Five-Year Financial Summary
a.
Fiscal 2015 was a 53-week year, while the other years presented were 52-week years.
b.
Fiscal 2015 included a $169 million pretax impairment charge related to our China operation, $57 million pretax expense related to merger and integration costs, $59 million pretax impairment charges related to our Prepared Foods network optimization, $12 million pretax charges related to Denison impairment and plant closure costs, $8 million pretax gain related to net insurance proceeds (net of costs) related to a legacy Hillshire Brands plant fire, $21 million pretax gain on the sale of equity securities, $161 million pretax gain on the sale of the Mexico operation, $39 million pretax gain related to the impact of the additional week in fiscal 2015 and $26 million unrecognized tax benefit gain.
c.
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 costs related to a legacy Hillshire Brands plant fire, $27 million pretax expense related to the Hillshire Brands acquisition financing incremental interest cost and $52 million unrecognized tax benefit gain.
d.
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. Additionally in 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.
e.
Fiscal 2012 included a pretax charge of $167 million related to the early extinguishment of debt.
f.
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.
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 a Non-GAAP measure and defined as net income less interest income, plus interest, taxes, depreciation and amortization. A reconciliation of net income to EBITDA immediately follows.
EBITDA RECONCILIATIONS
A reconciliation of net income to EBITDA is as follows:
in millions, except ratio data
2015
2014
2013
2012
2011
Net income
$
1,224
$
856
$
778
$
576
$
733
Less: Interest income
(9
)
(7
)
(7
)
(12
)
(11
)
Add: Interest expense
293
132
145
356
242
Add: Income tax expense (a)
697
396
411
351
341
Add: Depreciation
609
494
474
443
433
Add: Amortization (b)
92
26
17
17
29
EBITDA
$
2,906
$
1,897
$
1,818
$
1,731
$
1,767
Total gross debt
$
6,725
$
8,178
$
2,408
$
2,432
$
2,182
Less: Cash and cash equivalents
(688
)
(438
)
(1,145
)
(1,071
)
(716
)
Less: Short-term investments
(2
)
(1
)
(1
)
(3
)
(2
)
Total net debt
$
6,035
$
7,739
$
1,262
$
1,358
$
1,464
Ratio Calculations:
Gross debt/EBITDA
2.3x
4.3x
1.3x
1.4x
1.2x
Net debt/EBITDA
2.1x
4.1x
0.7x
0.8x
0.8x
(a)
Includes income tax expense of discontinued operation.
(b)
Excludes the amortization of debt discount expense of $10 million, $10 million, $28 million, $39 million and $44 million for fiscal 2015, 2014, 2013, 2012 and 2011, 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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