Summary
This Form 8-K filing from Kraft Foods Inc. (the predecessor to Mondelez International) on September 19, 2008, primarily announces the completion of the split-off of its Post cereals business. This transaction, completed on August 4, 2008, involved merging the Post cereals business into Ralcorp Holdings, Inc., following a shareholder tax-free exchange. This strategic divestiture signifies a shift in the company's operational focus, with the Post cereals business to be reported as discontinued operations from the third quarter of 2008 onwards. The company also detailed changes in how it reports segment information. The 'U.S. Snacks & Cereals' reportable segment has been renamed 'U.S. Snacks' to reflect the absence of the cereals business. Furthermore, Kraft Foods is providing updated unaudited financial schedules (Exhibit 99.1) to reconcile net revenues, operating income, and segment operating income based on this restatement for prior periods. The filing also clarifies that starting in the second quarter of 2008, unrealized gains and losses on hedging activities are excluded from segment operating income to enhance transparency.
Key Highlights
- 1Completion of the Post cereals business split-off transaction on August 4, 2008.
- 2The Post cereals business will be accounted for as discontinued operations from Q3 2008.
- 3Prior period financial results will be restated to reflect the discontinued operations.
- 4The 'U.S. Snacks & Cereals' reporting segment is now renamed 'U.S. Snacks'.
- 5Unaudited financial schedules reconciling net revenues and operating income, reflecting the Post divestiture, are attached as Exhibit 99.1.
- 6Starting Q2 2008, segment operating income excludes unrealized gains/losses on hedging activities for improved transparency.