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NOTES TO FINANCIAL STATEMENTS
In 2011, the North American fresh bakery operations recognized
a $122 million tax benefit associated with the excess tax basis
related to these assets.
In 2010, the household and body care operations reported
$453 million of tax expense which includes the following significant
tax amounts: i) a $428 million tax charge related to the company’s
third quarter decision to no longer reinvest overseas earnings
attributable to overseas cash and the net assets of the household
and body care businesses; ii) a $40 million tax benefit related to
the reversal of a tax valuation allowance on United Kingdom net
operating loss carryforwards as a result of the gain from the house-
hold and body care business dispositions; and iii) a $22 million
tax benefit related to the anticipated utilization of U.S. capital loss
carryforwards available to offset the capital gain resulting from the
household and body care business dispositions. Also in 2010, a
$10 million pretax curtailment loss was recognized in the results
of discontinued operations.
Gain (Loss) on the Sale of Discontinued Operations The gain (loss)
on the sales of discontinued operations recognized in 2011 and
2010 are summarized in the following tables.
Pretax Tax
Gain (Loss) (Charge)/ After Tax
In millions on Sale Benefit Gain (Loss)
2011
Global Body Care and
European Detergents $÷«867 $(376) $491
Air Care Products 273 (179) 94
Australia/New Zealand Bleach 48 (17) 31
Shoe Care Products 115 4 119
Other Household and
Body Care Businesses 1–1
Total $1,304 $(568) $736
2010
Godrej Sara Lee joint venture $÷«150 $÷(72) $÷78
Other 8 (2) 6
Total $÷«158 $÷(74) $÷84
The tax expense recognized on the sale of the household
and body care businesses in 2011 includes a $190 million charge
related to the anticipated repatriation of the cash proceeds received
on the disposition of these businesses. In the fourth quarter, a
repatriation tax benefit of $79 million was recognized on the gain
transactions, which was reflected in the income taxes on the shoe
care products gain.
In the fourth quarter of 2011, steps were taken to market and
dispose of the North American refrigerated dough business. This
business was classified as held for sale and reported as a discon-
tinued operation. On August 9, 2011, the corporation signed an
agreement to sell this business to Ralcorp for $545 million.
As of the end of 2011, the corporation has closed or received
binding offers for virtually all of its household and body care
businesses – body care, air care, shoe care and insecticides. The
corporation has completed the disposition of its global body care
and European detergents business, as well as, its Australia/New
Zealand bleach business. It has also completed the disposition of
a majority of its shoe care and air care businesses. The corporation
also entered into an agreement to sell its non-Indian insecticides
businesses and received a deposit on the sale. In 2010, the corpo-
ration disposed of its Godrej Sara Lee joint venture, an insecticide
business in India, which had been part of the household and body
care businesses.
Results of Discontinued Operations The amounts in the tables
below reflect the operating results of the businesses reported as
discontinued operations. The amounts of any gains or losses related
to the disposal of these discontinued operations are excluded.
Pretax
Income Income
In millions Net Sales (Loss) (Loss)
2011
International Household and Body Care $1,078 $÷72 $÷«36
North American Fresh Bakery 2,037 58 159
North American Refrigerated Dough 307 42 27
Total $3,422 $172 $«222
2010
International Household and Body Care $2,126 $254 $(199)
North American Fresh Bakery 2,128 32 23
North American Refrigerated Dough 326 56 37
Total $4,580 $342 $(139)
2009
International Household and Body Care $2,000 $245 $«155
North American Fresh Bakery 2,200 13 10
North American Refrigerated Dough 316 47 31
Total $4,516 $305 $«196
With respect to the North American fresh bakery and refrigerated
dough businesses, the reported amounts represent a full year of
results for each year presented. With respect to the household and
body care businesses, the reported results represent less than a
full year of results in 2011 and 2010 as certain of these businesses
were sold during 2011 and 2010.