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

Kraft Heinz Co., income tax expense (benefit), continuing operations

US$ in millions

12 months ended:	Dec 28, 2019	Dec 29, 2018	Dec 30, 2017	Dec 31, 2016	Dec 31, 2015
U.S. federal	466)	444)	757)	1,095)	427)
U.S. state and local	116)	134)	(46)	76)	22)
International	439)	322)	296)	239)	234)
Current	1,021)	900)	1,007)	1,410)	683)
U.S. federal	(209)	(1,843)	(6,570)	31)	(173)
U.S. state and local	(7)	(121)	101)	(60)	(70)
International	(77)	(3)	2)	—)	(74)
Deferred	(293)	(1,967)	(6,467)	(29)	(317)
Provision for (benefit from) income taxes	728)	(1,067)	(5,460)	1,381)	366)

Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

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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 Heinz Co. current decreased from 2017 to 2018 but then increased from 2018 to 2019 exceeding 2017 level.
Deferred	Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations.	Kraft Heinz Co. deferred increased from 2017 to 2018 and from 2018 to 2019.
Provision for (benefit from) income taxes	Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.	Kraft Heinz Co. provision for (benefit from) income taxes increased from 2017 to 2018 and from 2018 to 2019.

Kraft Heinz Co., effective income tax rate (EITR) reconciliation

	Dec 28, 2019	Dec 29, 2018	Dec 30, 2017	Dec 31, 2016	Dec 31, 2015
U.S. federal statutory tax rate	21.00%	21.00%	35.00%	35.00%	35.00%
Tax on income of foreign subsidiaries	-7.50%	3.40%	-4.70%	-3.60%	-11.80%
Domestic manufacturing deduction	0.00%	0.00%	-1.50%	-1.90%	-2.90%
U.S. state and local income taxes, net of federal tax benefit	1.10%	1.60%	1.10%	0.80%	-0.60%
Earnings repatriation	0.00%	0.00%	0.40%	0.40%	21.90%
Tax exempt income	0.00%	0.00%	-0.70%	-3.30%	-10.90%
Deferred tax effect of statutory tax rate changes	0.00%	0.00%	0.30%	-2.00%	-10.40%
Audit settlements and changes in uncertain tax positions	1.30%	-0.30%	-0.10%	1.80%	6.20%
Venezuela nondeductible devaluation loss	0.00%	0.00%	0.00%	0.20%	9.90%
Global intangible low-taxed income	1.80%	-0.50%	0.00%	0.00%	0.00%
Goodwill impairment	9.30%	-15.10%	0.00%	0.00%	0.00%
Wind-up of non-U.S. pension plans	0.00%	-0.40%	0.00%	0.00%	0.00%
(Gains) losses related to acquisitions and divestitures	1.00%	0.10%	0.00%	0.00%	0.00%
Movement of valuation allowance reserves	1.30%	0.00%	0.00%	0.00%	0.00%
Other	-1.90%	-0.90%	-1.20%	0.10%	-0.20%
Effective tax rate, before U.S. Tax Reform discrete income tax benefit	27.40%	8.90%	28.60%	27.50%	36.20%
U.S. Tax Reform discrete income tax benefit	0.00%	0.50%	-127.30%	0.00%	0.00%
Effective tax rate	27.40%	9.40%	-98.70%	27.50%	36.20%

Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

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Item	Description	The company
Effective tax rate, before U.S. Tax Reform discrete income tax benefit	Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.	Kraft Heinz Co. effective tax rate, before U.S. Tax Reform discrete income tax benefit decreased from 2017 to 2018 but then increased from 2018 to 2019 not reaching 2017 level.

Kraft Heinz Co., components of deferred tax assets and liabilities

US$ in millions

	Dec 28, 2019	Dec 29, 2018	Dec 30, 2017	Dec 31, 2016	Dec 31, 2015
Benefit plans	112)	172)	212)	1,025)	1,323)
Other	474)	470)	428)	782)	1,011)
Deferred income tax assets, gross	586)	642)	640)	1,807)	2,334)
Valuation allowance	(112)	(81)	(80)	(89)	(83)
Deferred income tax assets, net	474)	561)	560)	1,718)	2,251)
Intangible assets, net	(11,230)	(11,571)	(13,637)	(20,946)	(21,950)
Property, plant and equipment, net	(773)	(735)	(641)	(1,035)	(1,233)
Other	(252)	(410)	(293)	(532)	(495)
Deferred income tax liabilities	(12,255)	(12,716)	(14,571)	(22,513)	(23,678)
Net deferred income tax assets (liabilities)	(11,781)	(12,155)	(14,011)	(20,795)	(21,427)

Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

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Item	Description	The company
Deferred income tax assets, gross	Amount before allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards.	Kraft Heinz Co. deferred income tax assets, gross increased from 2017 to 2018 but then decreased significantly from 2018 to 2019.
Deferred income tax assets, net	Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards.	Kraft Heinz Co. deferred income tax assets, net increased from 2017 to 2018 but then decreased significantly from 2018 to 2019.
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 Heinz Co. net deferred income tax assets (liabilities) increased from 2017 to 2018 and from 2018 to 2019.

Kraft Heinz Co., deferred tax assets and liabilities, classification

US$ in millions

		Dec 28, 2019	Dec 29, 2018	Dec 30, 2017	Dec 31, 2016	Dec 31, 2015
	Deferred income tax assets	97)	47)	65)	53)	70)
	Deferred income tax liabilities	11,878)	12,202)	14,076)	20,848)	21,497)

Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

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Item	Description	The company
Deferred income tax assets	Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, with jurisdictional netting and classified as noncurrent.	Kraft Heinz Co. deferred income tax assets decreased from 2017 to 2018 but then increased from 2018 to 2019 exceeding 2017 level.
Deferred income tax liabilities	Amount, after deferred tax asset, of deferred tax liability attributable to taxable differences, with jurisdictional netting and classified as noncurrent.	Kraft Heinz Co. deferred income tax liabilities decreased from 2017 to 2018 and from 2018 to 2019.

Kraft Heinz Co., adjustments to financial statements

US$ in millions

	Dec 28, 2019	Dec 29, 2018	Dec 30, 2017	Dec 31, 2016	Dec 31, 2015
Adjustment to Total Assets
Total assets (as reported)	101,450)	103,461)	120,232)	120,480)	122,973)
Less: Noncurrent deferred tax assets, net	97)	47)	65)	53)	70)
Total assets (adjusted)	101,353)	103,414)	120,167)	120,427)	122,903)
Adjustment to Total Liabilities
Total liabilities (as reported)	49,701)	51,683)	53,985)	62,906)	56,737)
Less: Noncurrent deferred tax liabilities, net	11,878)	12,202)	14,076)	20,848)	21,497)
Total liabilities (adjusted)	37,823)	39,481)	39,909)	42,058)	35,240)
Adjustment to Shareholders’ Equity
Shareholders’ equity (as reported)	51,623)	51,657)	66,034)	57,358)	57,685)
Less: Net deferred tax assets (liabilities)	(11,781)	(12,155)	(14,011)	(20,795)	(21,427)
Shareholders’ equity (adjusted)	63,404)	63,812)	80,045)	78,153)	79,112)
Adjustment to Net Income (loss) Attributable To Kraft Heinz
Net income (loss) attributable to Kraft Heinz (as reported)	1,935)	(10,192)	10,999)	3,632)	634)
Add: Deferred income tax expense (benefit)	(293)	(1,967)	(6,467)	(29)	(317)
Net income (loss) attributable to Kraft Heinz (adjusted)	1,642)	(12,159)	4,532)	3,603)	317)

Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

Kraft Heinz Co., Financial Data: Reported vs. Adjusted

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Kraft Heinz Co., adjusted financial ratios

	Dec 28, 2019	Dec 29, 2018	Dec 30, 2017	Dec 31, 2016	Dec 31, 2015
Net Profit Margin
Reported net profit margin	7.75%	-38.80%	41.93%	13.71%	3.46%
Adjusted net profit margin	6.57%	-46.29%	17.28%	13.60%	1.73%
Total Asset Turnover
Reported total asset turnover	0.25	0.25	0.22	0.22	0.15
Adjusted total asset turnover	0.25	0.25	0.22	0.22	0.15
Financial Leverage
Reported financial leverage	1.97	2.00	1.82	2.10	2.13
Adjusted financial leverage	1.60	1.62	1.50	1.54	1.55
Return on Equity (ROE)
Reported ROE	3.75%	-19.73%	16.66%	6.33%	1.10%
Adjusted ROE	2.59%	-19.05%	5.66%	4.61%	0.40%
Return on Assets (ROA)
Reported ROA	1.91%	-9.85%	9.15%	3.01%	0.52%
Adjusted ROA	1.62%	-11.76%	3.77%	2.99%	0.26%

Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

Financial ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by total revenue.	Kraft Heinz Co. adjusted net profit margin ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level.
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Kraft Heinz Co. adjusted total asset turnover ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019.
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 Heinz Co. adjusted financial leverage ratio increased from 2017 to 2018 but then slightly decreased from 2018 to 2019.
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Kraft Heinz Co. adjusted ROE deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Kraft Heinz Co. adjusted ROA deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level.

Kraft Heinz Co., Financial Ratios: Reported vs. Adjusted

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	Dec 28, 2019	Dec 29, 2018	Dec 30, 2017	Dec 31, 2016	Dec 31, 2015
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) attributable to Kraft Heinz	1,935)	(10,192)	10,999)	3,632)	634)
Net sales	24,977)	26,268)	26,232)	26,487)	18,338)
Profitability Ratio
Net profit margin¹	7.75%	-38.80%	41.93%	13.71%	3.46%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income (loss) attributable to Kraft Heinz	1,642)	(12,159)	4,532)	3,603)	317)
Net sales	24,977)	26,268)	26,232)	26,487)	18,338)
Profitability Ratio
Adjusted net profit margin²	6.57%	-46.29%	17.28%	13.60%	1.73%

Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

2019 Calculations

¹ Net profit margin = 100 × Net income (loss) attributable to Kraft Heinz ÷ Net sales
= 100 × 1,935 ÷ 24,977 = 7.75%

² Adjusted net profit margin = 100 × Adjusted net income (loss) attributable to Kraft Heinz ÷ Net sales
= 100 × 1,642 ÷ 24,977 = 6.57%

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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 Heinz Co. adjusted net profit margin ratio deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level.

	Dec 28, 2019	Dec 29, 2018	Dec 30, 2017	Dec 31, 2016	Dec 31, 2015
As Reported
Selected Financial Data (US$ in millions)
Net sales	24,977)	26,268)	26,232)	26,487)	18,338)
Total assets	101,450)	103,461)	120,232)	120,480)	122,973)
Activity Ratio
Total asset turnover¹	0.25	0.25	0.22	0.22	0.15
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Net sales	24,977)	26,268)	26,232)	26,487)	18,338)
Adjusted total assets	101,353)	103,414)	120,167)	120,427)	122,903)
Activity Ratio
Adjusted total asset turnover²	0.25	0.25	0.22	0.22	0.15

Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

2019 Calculations

¹ Total asset turnover = Net sales ÷ Total assets
= 24,977 ÷ 101,450 = 0.25

² Adjusted total asset turnover = Net sales ÷ Adjusted total assets
= 24,977 ÷ 101,353 = 0.25

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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 Heinz Co. adjusted total asset turnover ratio improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019.

	Dec 28, 2019	Dec 29, 2018	Dec 30, 2017	Dec 31, 2016	Dec 31, 2015
As Reported
Selected Financial Data (US$ in millions)
Total assets	101,450)	103,461)	120,232)	120,480)	122,973)
Shareholders’ equity	51,623)	51,657)	66,034)	57,358)	57,685)
Solvency Ratio
Financial leverage¹	1.97	2.00	1.82	2.10	2.13
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted total assets	101,353)	103,414)	120,167)	120,427)	122,903)
Adjusted shareholders’ equity	63,404)	63,812)	80,045)	78,153)	79,112)
Solvency Ratio
Adjusted financial leverage²	1.60	1.62	1.50	1.54	1.55

Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

2019 Calculations

¹ Financial leverage = Total assets ÷ Shareholders’ equity
= 101,450 ÷ 51,623 = 1.97

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted shareholders’ equity
= 101,353 ÷ 63,404 = 1.60

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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 Heinz Co. adjusted financial leverage ratio increased from 2017 to 2018 but then slightly decreased from 2018 to 2019.

	Dec 28, 2019	Dec 29, 2018	Dec 30, 2017	Dec 31, 2016	Dec 31, 2015
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) attributable to Kraft Heinz	1,935)	(10,192)	10,999)	3,632)	634)
Shareholders’ equity	51,623)	51,657)	66,034)	57,358)	57,685)
Profitability Ratio
ROE¹	3.75%	-19.73%	16.66%	6.33%	1.10%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income (loss) attributable to Kraft Heinz	1,642)	(12,159)	4,532)	3,603)	317)
Adjusted shareholders’ equity	63,404)	63,812)	80,045)	78,153)	79,112)
Profitability Ratio
Adjusted ROE²	2.59%	-19.05%	5.66%	4.61%	0.40%

Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

2019 Calculations

¹ ROE = 100 × Net income (loss) attributable to Kraft Heinz ÷ Shareholders’ equity
= 100 × 1,935 ÷ 51,623 = 3.75%

² Adjusted ROE = 100 × Adjusted net income (loss) attributable to Kraft Heinz ÷ Adjusted shareholders’ equity
= 100 × 1,642 ÷ 63,404 = 2.59%

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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 Heinz Co. adjusted ROE deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level.

	Dec 28, 2019	Dec 29, 2018	Dec 30, 2017	Dec 31, 2016	Dec 31, 2015
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) attributable to Kraft Heinz	1,935)	(10,192)	10,999)	3,632)	634)
Total assets	101,450)	103,461)	120,232)	120,480)	122,973)
Profitability Ratio
ROA¹	1.91%	-9.85%	9.15%	3.01%	0.52%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income (loss) attributable to Kraft Heinz	1,642)	(12,159)	4,532)	3,603)	317)
Adjusted total assets	101,353)	103,414)	120,167)	120,427)	122,903)
Profitability Ratio
Adjusted ROA²	1.62%	-11.76%	3.77%	2.99%	0.26%

Based on: 10-K (reporting date: 2019-12-28), 10-K (reporting date: 2018-12-29), 10-K (reporting date: 2017-12-30), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

2019 Calculations

¹ ROA = 100 × Net income (loss) attributable to Kraft Heinz ÷ Total assets
= 100 × 1,935 ÷ 101,450 = 1.91%

² Adjusted ROA = 100 × Adjusted net income (loss) attributable to Kraft Heinz ÷ Adjusted total assets
= 100 × 1,642 ÷ 101,353 = 1.62%

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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 Heinz Co. adjusted ROA deteriorated from 2017 to 2018 but then improved from 2018 to 2019 not reaching 2017 level.

Kraft Heinz Co. (NASDAQ:KHC)

Analysis of Income Taxes

Income Tax Expense (Benefit)

Effective Income Tax Rate (EITR)

Components of Deferred Tax Assets and Liabilities

Deferred Tax Assets and Liabilities, Classification

Adjustments to Financial Statements: Removal of Deferred Taxes

Kraft Heinz Co., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Kraft Heinz Co., Financial Ratios: Reported vs. Adjusted

Adjusted Net Profit Margin

Adjusted Total Asset Turnover

Adjusted Financial Leverage

Adjusted Return on Equity (ROE)

Adjusted Return on Assets (ROA)