Financial Statements 2014 - Nestlé Global

1 Financial Statements 2014 Consolidated Financial Statements of the nestl Group 2014148th Financial Statements of nestl Financial Statements of the nestl Group 2014 Consolidated Financial Statements of the nestl Group 201456 Principal exchange ratesConsolidated income statement for the year ended 31 December 2014 Consolidated statement of comprehensive income for the year ended 31 December 2014 Consolidated balance sheet as at 31 December 2014 Consolidated cash flow statement for the year ended 31 December 2014 Consolidated statement of changes in equity for the year ended 31 December 2014 Notes 1.

2 Accounting policies 2. Acquisitions and disposals of businesses 3. Analyses by segment 4. Net other trading and operating income/(expenses) 5. Net Financial income/(expense) 6. Inventories 7. Trade and other receivables 8. Property, plant and equipment 9. Goodwill and intangible assets10. Employee benefits11. Equity compensation plans12. Provisions and contingencies13. Financial instruments14. Taxes15. Associates and joint ventures16. Earnings per share17. Cash flow statement18. Equity19. Lease commitments20.

3 Transactions with related parties21. Guarantees22. Group risk management23. Group exposure in Venezuela24. Events after the balance sheet date25. Group companiesReport of the Statutory Auditor on the Consolidated Financial StatementsFinancial information 5 year reviewCompanies of the nestl Group57585960626365657578838486889210010 2104113115117120123124125127128130132 Consolidated Financial Statements of the nestl Group 201457 Principal exchange ratesCHF per2014 2013 2014 2013 Year ending ratesWeighted average annual rates1 US Euro Chinese Yuan Brazilian Pound Mexican Philippine Canadian Russian Australian Japanese

4 Financial Statements of the nestl Group 201458 Consolidated income statement for the year ended 31 December 2014In millions of CHFN otes20142013 Sales391 612 92 158 Other revenue 253 215 Cost of goods sold(47 553)(48 111)Distribution expenses(8 217)(8 156)Marketing and administration expenses(19 651)(19 711)Research and development costs (1 628)(1 503)Other trading income4 110 120 Other trading expenses4(907)(965)Trading operating profit314 019 14 047 Other operating income4 154 616 Other operating expenses4(3 268)(1 595)Operating profit10 905 13 068 Financial income5 135 219 Financial expense5(772)(850)Profit before taxes, associates and joint ventures10 268 12 437 Taxes14(3 367)(3 256)Income from associates and joint ventures158 003 1 264 Profit for the year14 904 10 445 of which attributable to non-controlling interests 448 430 of which attributable to shareholders of the parent (Net profit)

5 14 456 10 015 As percentages of salesTrading operating Profit for the year attributable to shareholders of the parent (Net profit) Earnings per share (in CHF)Basic earnings per Diluted earnings per Consolidated Financial Statements of the nestl Group 201459 Consolidated statement of comprehensive income for the year ended 31 December 2014In millions of CHFN otes2014 2013 Profit for the year recognised in the income statement 14 904 10 445 Currency retranslations Recognised in translation reserve2 660 (3 160)

6 Reclassified from translation reserve to income statement1 003 214 Fair value adjustments on available-for-sale Financial instruments Recognised in fair value reserve191 9 Reclassified from fair value reserve to income statement(4)(532)Fair value adjustments on cash flow hedges Recognised in hedging reserve31 161 Reclassified from hedging reserve(87)85 Taxes145 290 Share of other comprehensive income of associates and joint ventures15 Recognised in the reserves83 40 Reclassified from the reserves(436) Items that are or may be reclassified subsequently to the income statement3 446 (2 893)Remeasurement of defined benefit plans10(1 745)1 632 Taxes14352 (848)Share of other comprehensive income of associates and joint ventures15(153)47 Items that will never be reclassified to the income statement(1 546)

7 831 Other comprehensive income for the year181 900 (2 062)Total comprehensive income for the year16 804 8 383 of which attributable to non-controlling interests556 371 of which attributable to shareholders of the parent16 248 8 012 Consolidated Financial Statements of the nestl Group 201460 Consolidated balance sheet as at 31 December 2014before appropriationsIn millions of CHFN otes2014 2013 AssetsCurrent assetsCash and cash equivalents13/177 448 6 415 Short-term investments131 433 638 Inventories69 172 8 382 Trade and other receivables7/1313 459 12 206

8 Prepayments and accrued income 565 762 Derivative assets13 400 230 Current income tax assets 908 1 151 Assets held for sale2 576 282 Total current assets33 961 30 066 Non-current assetsProperty, plant and equipment828 421 26 895 Goodwill934 557 31 039 Intangible assets919 800 12 673 Investments in associates and joint ventures158 649 12 315 Financial assets135 493 4 550 Employee benefits assets10 383 537 Current income tax assets 128 124 Deferred tax assets142 058 2 243 Total non-current assets99 489 90 376 Total assets133 450 120 442 Consolidated Financial Statements of the nestl Group 201461 Consolidated balance sheet as at 31 December 2014In millions of CHFN otes2014 2013 Liabilities and

9 EquityCurrent liabilitiesFinancial debt138 810 11 380 Trade and other payables1317 437 16 072 Accruals and deferred income3 759 3 185 Provisions12 695 523 Derivative liabilities13 757 381 Current income tax liabilities1 264 1 276 Liabilities directly associated with assets held for sale 2 173 100 Total current liabilities32 895 32 917 Non-current liabilitiesFinancial debt1312 396 10 363 Employee benefits liabilities108 081 6 279 Provisions123 161 2 714 Deferred tax liabilities143 191 2 643 Other payables131 842 1 387 Total non-current liabilities28 671 23 386 Total liabilities61 566 56 303 Equity18 Share capital 322 322 Treasury shares (3 918)(2 196)Translation reserve(17 255)(20 811)

10 Retained earnings and other reserves90 981 85 260 Total equity attributable to shareholders of the parent70 130 62 575 Non-controlling interests1 754 1 564 Total equity71 884 64 139 Total liabilities and equity133 450 120 442 Consolidated Financial Statements of the nestl Group 201462 Consolidated cash flow statement for the year ended 31 December 2014In millions of CHFN otes2014 2013 Operating activitiesOperating profit17 10 905 13 068 Non-cash items of income and expense17 6 323 4 352 Cash flow before changes in operating assets and liabilities17 228 17 420 Decrease/(increase) in working capital17 (114)1 360 Variation of other operating assets and liabilities17 85 (574)Cash generated from operations17 199 18 206 Net cash flows from treasury activities17 (356)(351)Taxes paid(2 859)(3 520)Dividends and interest from associates and joint ventures15 716 657 Operating cash flow14 700 14 992 Investing activitiesCapital expenditure8 (3 914)(4 928)Expenditure on intangible assets9 (509)(402)