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Segment Reporting | 3 Months Ended
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Mar. 31, 2017
Segment Reporting | Note 15. Segment Reporting We manufacture and market primarily snack food products, including biscuits (cookies, crackers and salted snacks), chocolate, gum & candy and various cheese & grocery products, as well as powdered beverage products. We manage our global business and report operating results through geographic units. Our operations and management structure are organized into four reportable operating segments:
| • |  | Latin America
| • |  | AMEA
| • |  | Europe
| • |  | North America
On October 1, 2016, we integrated our EEMEA operating segment into our Europe and Asia Pacific operating segments to further leverage and optimize the operating scale built within the Europe and Asia Pacific regions. Russia, Ukraine, Turkey, Belarus, Georgia and Kazakhstan were combined within our Europe operating segment, while the remaining Middle East and African countries were combined within our Asia Pacific region to form the AMEA operating segment. We have reflected the segment change as if it had occurred in all periods presented. We manage our operations by region to leverage regional operating scale, manage different and changing business environments more effectively and pursue growth opportunities as they arise in our key markets. Our regional management teams have responsibility for the business, product categories and financial results in the regions. We use segment operating income to evaluate segment performance and allocate resources. We believe it is appropriate to disclose this measure to help investors analyze segment performance and trends. Segment operating income excludes unrealized gains and losses on hedging activities (which are a component of cost of sales), general corporate expenses (which are a component of selling, general and administrative expenses) and amortization of intangibles in all periods presented. We exclude these items from segment operating income in order to provide better transparency of our segment operating results. Furthermore, we centrally manage interest and other expense, net. Accordingly, we do not present these items by segment because they are excluded from the segment profitability measure that management reviews. Our segment net revenues and earnings, revised to reflect our new segment structure, were:
|  | For the Three Months Ended |
|  | March 31, |
|  | 2017 |  |  | 2016 |
|  | (in millions) |
Net revenues: |  |  |  |  |  |  |  |
Latin America |  | $ | 910 |  |  | $ | 817 |
AMEA |  |  | 1,491 |  |  |  | 1,515 |
Europe |  |  | 2,365 |  |  |  | 2,448 |
North America |  |  | 1,648 |  |  |  | 1,675 |
Net revenues |  | $ | 6,414 |  |  | $ | 6,455 |
Earnings before income taxes: |  |  |  |  |  |  |  |
Operating income: |  |  |  |  |  |  |  |
Latin America |  | $ | 111 |  |  | $ | 67 |
AMEA |  |  | 181 |  |  |  | 190 |
Europe |  |  | 409 |  |  |  | 352 |
North America |  |  | 292 |  |  |  | 271 |
Unrealized losses on hedging activities (mark-to-market impacts) |  |  | (51 | ) |  |  | (54 | )
General corporate expenses |  |  | (58 | ) |  |  | (60 | )
Amortization of intangibles |  |  | (44 | ) |  |  | (44 | )
Operating income |  |  | 840 |  |  |  | 722 |
Interest and other expense, net |  |  | (119 | ) |  |  | (244 | )
Earnings before income taxes |  | $ | 721 |  |  | $ | 478 |
Items impacting our segment operating results are discussed in Note 1, Basis of Presentation, Note 2, Divestitures and Acquisitions, Note 4, Property, Plant and Equipment, Note 5, Goodwill and Intangible Assets, Note 6, 2014-2018 Restructuring Program and Note 11. Commitments and Contingencies. Also see Note 7, Debt and Borrowing Arrangements, and Note 8, Financial Instruments, for more information on our interest and other expense, net for each period. Net revenues by product category, revised to reflect our new segment structure, were:
|  | For the Three Months Ended March 31, 2017 |
|  | Latin America |  |  | AMEA |  |  | Europe |  |  | North America |  |  | Total |
|  | (in millions) |
Biscuits |  | $ | 170 |  |  | $ | 399 |  |  | $ | 651 |  |  | $ | 1,333 |  |  | $ | 2,553 |
Chocolate |  |  | 259 |  |  |  | 515 |  |  |  | 1,223 |  |  |  | 70 |  |  |  | 2,067 |
Gum & Candy |  |  | 213 |  |  |  | 229 |  |  |  | 193 |  |  |  | 245 |  |  |  | 880 |
Beverages |  |  | 193 |  |  |  | 173 |  |  |  | 41 |  |  |  | – |  |  |  | 407 |
Cheese & Grocery |  |  | 75 |  |  |  | 175 |  |  |  | 257 |  |  |  | – |  |  |  | 507 |
Total net revenues |  | $ | 910 |  |  | $ | 1,491 |  |  | $ | 2,365 |  |  | $ | 1,648 |  |  | $ | 6,414 |
|  | For the Three Months Ended March 31, 2016 |
|  | Latin America |  |  | AMEA |  |  | Europe |  |  | North America |  |  | Total |
|  | (in millions) |
Biscuits |  | $ | 164 |  |  | $ | 407 |  |  | $ | 643 |  |  | $ | 1,361 |  |  | $ | 2,575 |
Chocolate |  |  | 198 |  |  |  | 493 |  |  |  | 1,263 |  |  |  | 45 |  |  |  | 1,999 |
Gum & Candy |  |  | 216 |  |  |  | 256 |  |  |  | 216 |  |  |  | 269 |  |  |  | 957 |
Beverages |  |  | 164 |  |  |  | 177 |  |  |  | 48 |  |  |  | – |  |  |  | 389 |
Cheese & Grocery |  |  | 75 |  |  |  | 182 |  |  |  | 278 |  |  |  | – |  |  |  | 535 |
Total net revenues |  | $ | 817 |  |  | $ | 1,515 |  |  | $ | 2,448 |  |  | $ | 1,675 |  |  | $ | 6,455 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8981-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9038-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8971-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8595-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8380-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8984-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9031-108599 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9054-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8538-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8864-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8924-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8906-108599 + Details
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