Income Tax Expense (Benefit)
Effective Income Tax Rate (EITR)
Components of Deferred Tax Assets and Liabilities
Adjustments to Financial Statements: Removal of Deferred Taxes
Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)
Adjusted Current Ratio
Adjusted Net Profit Margin
Adjusted Total Asset Turnover
Adjusted Financial Leverage
Adjusted Return on Equity (ROE)
Adjusted Return on Assets (ROA)

Kraft Foods Group Inc., income tax expense (benefit), continuing operations

US$ in millions

12 months ended:	Dec 27, 2014	Dec 28, 2013	Dec 29, 2012
United States federal	678)	591)	209)
State and local	(34)	34)	54)
United States	644)	625)	263)
Outside United States	80)	42)	78)
Current	724)	667)	341)
United States federal	(336)	566)	424)
State and local	(26)	61)	43)
United States	(362)	627)	467)
Outside United States	1)	81)	3)
Deferred	(361)	708)	470)
Provision for income taxes	363)	1,375)	811)

Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).

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Item	Description	The company
Current	Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations.	Kraft Foods Group Inc. current increased from 2012 to 2013 and from 2013 to 2014.
Deferred	Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations.	Kraft Foods Group Inc. deferred increased from 2012 to 2013 but then decreased significantly from 2013 to 2014.
Provision for income taxes	Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.	Kraft Foods Group Inc. provision for income taxes increased from 2012 to 2013 but then decreased significantly from 2013 to 2014.

Kraft Foods Group Inc., effective income tax rate (EITR) reconciliation

	Dec 27, 2014	Dec 28, 2013	Dec 29, 2012
U.S. federal statutory tax rate	35.00%	35.00%	35.00%
U.S. state and local income taxes, net of federal tax benefit	0.20%	1.70%	2.30%
Domestic manufacturing deduction	-4.60%	-1.20%	-2.70%
Foreign rate differences	-2.20%	-1.10%	-1.10%
Changes in uncertain tax positions	-0.90%	0.20%	-0.80%
Other	-1.70%	-1.00%	0.40%
Effective tax rate	25.80%	33.60%	33.10%

Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).

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Item	Description	The company
Effective tax rate	Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.	Kraft Foods Group Inc. effective tax rate increased from 2012 to 2013 but then decreased significantly from 2013 to 2014.

Kraft Foods Group Inc., components of deferred tax assets and liabilities

US$ in millions

	Dec 27, 2014	Dec 28, 2013	Dec 29, 2012
Pension benefits	407)	104)	730)
Postretirement benefits	1,355)	1,238)	1,418)
Other employee benefits	113)	122)	102)
Other	471)	497)	442)
Deferred income tax assets	2,346)	1,961)	2,692)
Valuation allowance	(20)	(3)	(26)
Net deferred income tax assets	2,326)	1,958)	2,666)
Trade names	(828)	(828)	(977)
Property, plant and equipment	(979)	(949)	(969)
Debt exchange	(350)	(384)	(418)
Other	(66)	(65)	(17)
Deferred income tax liabilities	(2,223)	(2,226)	(2,381)
Net deferred income tax assets (liabilities)	103)	(268)	285)

Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).

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Item	Description	The company
Deferred income tax assets	Amount before allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards.	Kraft Foods Group Inc. deferred income tax assets decreased from 2012 to 2013 but then increased from 2013 to 2014 not reaching 2012 level.
Net deferred income tax assets	Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards.	Kraft Foods Group Inc. net deferred income tax assets decreased from 2012 to 2013 but then increased from 2013 to 2014 not reaching 2012 level.
Net deferred income tax assets (liabilities)	Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting.	Kraft Foods Group Inc. net deferred income tax assets (liabilities) decreased from 2012 to 2013 but then increased from 2013 to 2014 not reaching 2012 level.

Kraft Foods Group Inc., adjustments to financial statements

US$ in millions

	Dec 27, 2014	Dec 28, 2013	Dec 29, 2012
Adjustment to Current Assets
Current assets (as reported)	4,791)	4,908)	4,823)
Less: Current deferred tax assets, net	384)	360)	420)
Current assets (adjusted)	4,407)	4,548)	4,403)
Adjustment to Total Assets
Total assets (as reported)	22,947)	23,148)	23,329)
Less: Current deferred tax assets, net	384)	360)	420)
Total assets (adjusted)	22,563)	22,788)	22,909)
Adjustment to Total Liabilities
Total liabilities (as reported)	18,582)	17,961)	19,757)
Less: Noncurrent deferred tax liabilities, net	340)	662)	288)
Total liabilities (adjusted)	18,242)	17,299)	19,469)
Adjustment to Equity
Equity (as reported)	4,365)	5,187)	3,572)
Less: Net deferred tax assets (liabilities)	103)	(268)	285)
Equity (adjusted)	4,262)	5,455)	3,287)
Adjustment to Net Earnings
Net earnings (as reported)	1,043)	2,715)	1,642)
Add: Deferred income tax expense (benefit)	(361)	708)	470)
Net earnings (adjusted)	682)	3,423)	2,112)

Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).

Kraft Foods Group Inc., Financial Data: Reported vs. Adjusted

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Kraft Foods Group Inc., adjusted financial ratios

	Dec 27, 2014	Dec 28, 2013	Dec 29, 2012
Current Ratio
Reported current ratio	1.00	1.44	1.34
Adjusted current ratio	0.92	1.33	1.22
Net Profit Margin
Reported net profit margin	5.73%	14.90%	8.95%
Adjusted net profit margin	3.75%	18.79%	11.52%
Total Asset Turnover
Reported total asset turnover	0.79	0.79	0.79
Adjusted total asset turnover	0.81	0.80	0.80
Financial Leverage
Reported financial leverage	5.26	4.46	6.53
Adjusted financial leverage	5.29	4.18	6.97
Return on Equity (ROE)
Reported ROE	23.89%	52.34%	45.97%
Adjusted ROE	16.00%	62.75%	64.25%
Return on Assets (ROA)
Reported ROA	4.55%	11.73%	7.04%
Adjusted ROA	3.02%	15.02%	9.22%

Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).

Financial ratio	Description	The company
Adjusted current ratio	A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities.	Kraft Foods Group Inc. adjusted current ratio improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014.
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by total revenue.	Kraft Foods Group Inc. adjusted net profit margin ratio improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014.
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Kraft Foods Group Inc. adjusted total asset turnover ratio deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level.
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Kraft Foods Group Inc. adjusted financial leverage ratio decreased from 2012 to 2013 but then slightly increased from 2013 to 2014.
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Kraft Foods Group Inc. adjusted ROE deteriorated from 2012 to 2013 and from 2013 to 2014.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Kraft Foods Group Inc. adjusted ROA improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014.

Kraft Foods Group Inc., Financial Ratios: Reported vs. Adjusted

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	Dec 27, 2014	Dec 28, 2013	Dec 29, 2012
As Reported
Selected Financial Data (US$ in millions)
Current assets	4,791)	4,908)	4,823)
Current liabilities	4,773)	3,410)	3,606)
Liquidity Ratio
Current ratio¹	1.00	1.44	1.34
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted current assets	4,407)	4,548)	4,403)
Current liabilities	4,773)	3,410)	3,606)
Liquidity Ratio
Adjusted current ratio²	0.92	1.33	1.22

Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).

2014 Calculations

¹ Current ratio = Current assets ÷ Current liabilities
= 4,791 ÷ 4,773 = 1.00

² Adjusted current ratio = Adjusted current assets ÷ Current liabilities
= 4,407 ÷ 4,773 = 0.92

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Liquidity ratio	Description	The company
Adjusted current ratio	A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities.	Kraft Foods Group Inc. adjusted current ratio improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014.

	Dec 27, 2014	Dec 28, 2013	Dec 29, 2012
As Reported
Selected Financial Data (US$ in millions)
Net earnings	1,043)	2,715)	1,642)
Net revenues	18,205)	18,218)	18,339)
Profitability Ratio
Net profit margin¹	5.73%	14.90%	8.95%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net earnings	682)	3,423)	2,112)
Net revenues	18,205)	18,218)	18,339)
Profitability Ratio
Adjusted net profit margin²	3.75%	18.79%	11.52%

Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).

2014 Calculations

¹ Net profit margin = 100 × Net earnings ÷ Net revenues
= 100 × 1,043 ÷ 18,205 = 5.73%

² Adjusted net profit margin = 100 × Adjusted net earnings ÷ Net revenues
= 100 × 682 ÷ 18,205 = 3.75%

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Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by total revenue.	Kraft Foods Group Inc. adjusted net profit margin ratio improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014.

	Dec 27, 2014	Dec 28, 2013	Dec 29, 2012
As Reported
Selected Financial Data (US$ in millions)
Net revenues	18,205)	18,218)	18,339)
Total assets	22,947)	23,148)	23,329)
Activity Ratio
Total asset turnover¹	0.79	0.79	0.79
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Net revenues	18,205)	18,218)	18,339)
Adjusted total assets	22,563)	22,788)	22,909)
Activity Ratio
Adjusted total asset turnover²	0.81	0.80	0.80

Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).

2014 Calculations

¹ Total asset turnover = Net revenues ÷ Total assets
= 18,205 ÷ 22,947 = 0.79

² Adjusted total asset turnover = Net revenues ÷ Adjusted total assets
= 18,205 ÷ 22,563 = 0.81

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Activity ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Kraft Foods Group Inc. adjusted total asset turnover ratio deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level.

	Dec 27, 2014	Dec 28, 2013	Dec 29, 2012
As Reported
Selected Financial Data (US$ in millions)
Total assets	22,947)	23,148)	23,329)
Equity	4,365)	5,187)	3,572)
Solvency Ratio
Financial leverage¹	5.26	4.46	6.53
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted total assets	22,563)	22,788)	22,909)
Adjusted equity	4,262)	5,455)	3,287)
Solvency Ratio
Adjusted financial leverage²	5.29	4.18	6.97

Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).

2014 Calculations

¹ Financial leverage = Total assets ÷ Equity
= 22,947 ÷ 4,365 = 5.26

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted equity
= 22,563 ÷ 4,262 = 5.29

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Solvency ratio	Description	The company
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Kraft Foods Group Inc. adjusted financial leverage ratio decreased from 2012 to 2013 but then slightly increased from 2013 to 2014.

	Dec 27, 2014	Dec 28, 2013	Dec 29, 2012
As Reported
Selected Financial Data (US$ in millions)
Net earnings	1,043)	2,715)	1,642)
Equity	4,365)	5,187)	3,572)
Profitability Ratio
ROE¹	23.89%	52.34%	45.97%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net earnings	682)	3,423)	2,112)
Adjusted equity	4,262)	5,455)	3,287)
Profitability Ratio
Adjusted ROE²	16.00%	62.75%	64.25%

Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).

2014 Calculations

¹ ROE = 100 × Net earnings ÷ Equity
= 100 × 1,043 ÷ 4,365 = 23.89%

² Adjusted ROE = 100 × Adjusted net earnings ÷ Adjusted equity
= 100 × 682 ÷ 4,262 = 16.00%

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Profitability ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Kraft Foods Group Inc. adjusted ROE deteriorated from 2012 to 2013 and from 2013 to 2014.

	Dec 27, 2014	Dec 28, 2013	Dec 29, 2012
As Reported
Selected Financial Data (US$ in millions)
Net earnings	1,043)	2,715)	1,642)
Total assets	22,947)	23,148)	23,329)
Profitability Ratio
ROA¹	4.55%	11.73%	7.04%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net earnings	682)	3,423)	2,112)
Adjusted total assets	22,563)	22,788)	22,909)
Profitability Ratio
Adjusted ROA²	3.02%	15.02%	9.22%

Based on: 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29).

2014 Calculations

¹ ROA = 100 × Net earnings ÷ Total assets
= 100 × 1,043 ÷ 22,947 = 4.55%

² Adjusted ROA = 100 × Adjusted net earnings ÷ Adjusted total assets
= 100 × 682 ÷ 22,563 = 3.02%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Kraft Foods Group Inc. adjusted ROA improved from 2012 to 2013 but then deteriorated significantly from 2013 to 2014.

Kraft Foods Group Inc. (NASDAQ:KRFT)

Analysis of Income Taxes

Income Tax Expense (Benefit)

Effective Income Tax Rate (EITR)

Components of Deferred Tax Assets and Liabilities

Adjustments to Financial Statements: Removal of Deferred Taxes

Kraft Foods Group Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Kraft Foods Group Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Current Ratio

Adjusted Net Profit Margin

Adjusted Total Asset Turnover

Adjusted Financial Leverage

Adjusted Return on Equity (ROE)

Adjusted Return on Assets (ROA)