UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

x   Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934

For the quarterly period ended September 30, 2004

o   Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from            to           

For the Quarter Ended September 30, 2004          Commission file number 1-800

WM. WRIGLEY JR. COMPANY

(Exact name of registrant as specified in its charter)

Delaware

36-1988190

(State of other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification No.)

410 North Michigan Avenue
Chicago, Illinois

60611

(Address of principal executive office)

(Zip Code)

(312) 644-2121
(Registrant's telephone number, including area code)

Indicate by check mark whether the Registrant: (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the Registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.

YES   x         NO   o

Indicate by check mark whether the Registrant is an accelerated filer
(as defined under Rule 12b-2 of the Securities and Exchange Act of 1934).

YES   x         NO   o

190,871,069 shares of Common Stock and 33,567,353 shares of Class B Common Stock were
outstanding as of October 29, 2004.

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION

ITEM 1 FINANCIAL INFORMATION

CONSOLIDATED STATEMENT OF EARNINGS (CONDENSED) FOR THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

CONSOLIDATED STATEMENT OF CASH FLOWS (CONDENSED) FOR NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

CONSOLIDATED BALANCE SHEET (CONDENSED) AS OF SEPTEMBER 30, 2004 AND DECEMBER 31, 2003

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONDENSED)

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION

ITEM 2E - REPURCHASE OF EQUITY SECURITIES

ITEM 3 - QUANTATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 4 - CONTROLS AND PROCEDURES

PART II - OTHER INFORMATION

ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K

SIGNATURES

INDEX TO EXHIBITS

WM. WRIGLEY JR. COMPANY
INDEX TO FORM 10-Q

Page

PART I - FINANCIAL INFORMATION

Item 1 - Financial Statements

Consolidated Statement of Earnings (Condensed) for the Three and Nine Months Ended September 30, 2004 and 2003

2

Consolidated Statement of Cash Flows (Condensed) for the Nine Months Ended September 30, 2004 and 2003

3

Consolidated Balance Sheet (Condensed) as of September 30, 2004 and December 31, 2003

4

Notes to Consolidated Financial Statements (Condensed)

5 - 10

Item 2 - Management's Discussion and Analysis of Results of Operations and Financial Condition

11 - 13

Item 2e - Repurchase of Equity Securities

14

Item 3 - Quantitative and Qualitative Disclosures About Market Risk

15

Item 4 - Controls and Procedures

15

PART II - OTHER INFORMATION

Item 6 - Exhibits and Reports on Form 8-K

16

SIGNATURES

17

INDEX TO EXHIBITS

18

Table of Contents

FORM 10-Q
PART I - FINANCIAL INFORMATION - ITEM 1
WM. WRIGLEY JR. COMPANY
CONSOLIDATED STATEMENT OF EARNINGS (CONDENSED)
(Unaudited)

Three Months Ended
September 30,

Nine Months Ended
September 30,

2004

2003

2004

2003

Net Sales

$

916,675

782,877

2,686,732

2,247,884

Cost of Sales

407,944

346,264

1,179,596

956,854

Gross Profit

508,731

436,613

1,507,136

1,291,030

Selling, General and Administrative Expense

324,882

269,152

957,448

801,185

Operating Income

183,849

167,461

549,688

489,845

Investment Income

3,110

1,953

7,870

6,354

Other (Expense)

(1,995)

(3,138)

(4,670)

(2,057)

Earnings before Income Taxes

184,964

166,276

552,888

494,142

Income Taxes

59,188

53,208

176,924

158,125

Net Earnings

$

125,776

113,068

375,964

336,017

Net Earnings per average share

of Common Stock (basic and diluted)

$

0.56

0.50

1.67

1.49

Dividends declared per share

of Common Stock

$

0.235

0.220

0.705

0.660

Average number of shares

outstanding for the period

224,471

224,886

224,651

225,016

All amounts in thousands except for per share values.

Notes to financial statements beginning on page 5 are an integral part of these statements.

2

Table of Contents

FORM 10-Q
PART I - FINANCIAL INFORMATION - ITEM 1 (Cont'd)
WM. WRIGLEY JR. COMPANY
CONSOLIDATED STATEMENT OF CASH FLOWS (CONDENSED)
(Unaudited)

Nine Months Ended
September 30,

2004

2003

OPERATING ACTIVITIES

Net Earnings

$

375,964

336,017

Adjustments to reconcile net earnings to net

cash provided by operating activities:

Depreciation

105,368

80,394

Loss on retirements of property, plant,

and equipment

8,701

6,291

(Increase) decrease in:

Accounts receivable

(10,095)

(3,460)

Inventories

10,850

(33,652)

Other current assets

(16,400)

(6,270)

Other assets and deferred charges

(3,214)

4,970

Increase (decrease) in:

Accounts payable

(9,634)

32,629

Accrued expenses

59,062

5,341

Income and other taxes payable

169

142

Deferred taxes

2,913

4,806

Other noncurrent liabilities

14,943

7,551

Net cash provided by operating activities

$

538,627

434,759

INVESTING ACTIVITIES

Additions to property, plant, and equipment

$

(142,220)

(116,012)

Proceeds from disposal of property, plant and equipment

2,824

3,930

Acquisition, net of cash acquired

(263,189)

--

Purchases of short-term investments

(27,757)

(28,273)

Maturities of short-term investments

27,769

32,720

Net cash used in investing activities

(402,573)

(107,635)

FINANCING ACTIVITIES

Dividends paid

(155,068)

(145,186)

Net purchases of common stock

(46,720)

(28,126)

Borrowings under the line of credit

130,000

--

Net cash used in financing activities

(71,788)

(173,312)

Effect of exchange rate changes on cash and

cash equivalents

5,446

849

Net increase in cash and cash equivalents

69,712

154,661

Cash and cash equivalents at beginning of period

505,217

279,276

Cash and cash equivalents at end of period

$

574,929

433,937

SUPPLEMENTAL CASH FLOW INFORMATION

Income taxes paid

$

184,007

146,913

Interest paid

$

2,431

1,437

Interest and dividends received

$

7,870

6,347

All amounts in thousands.

Notes to financial statements beginning on page 5 are an integral part of these statements.

3

Table of Contents

FORM 10-Q
PART I - FINANCIAL INFORMATION - ITEM 1 (Cont'd)
WM. WRIGLEY JR. COMPANY
CONSOLIDATED BALANCE SHEET (CONDENSED)

(Unaudited)
September 30,
2004

December 31,
2003

Current assets:

Cash and cash equivalents

$

574,929

505,217

Short-term investments, at amortized cost

22,677

22,509

Accounts receivable

(less allowance for doubtful accounts;
9/30/04 - $10,608; 12/31/03 - $9,232)

375,750

328,862

Inventories -

Finished goods

137,245

127,839

Raw materials and supplies

234,690

222,129

371,935

349,968

Other current assets

84,402

60,209

Deferred incomes taxes - current

23,622

23,826

Total current assets

1,453,315

1,290,591

Marketable equity securities at fair value

16,167

16,239

Deferred charges and other assets

246,309

197,522

Goodwill

154,893

26,730

Deferred income taxes - noncurrent

32,768

33,148

Property, plant and equipment, at cost

1,938,674

1,745,193

Less accumulated depreciation

877,170

789,013

Net property, plant, and equipment

1,061,504

956,180

Total assets

$

2,964,956

2,520,410

Current liabilities:

Line of credit

$

130,000

--

Accounts payable

155,774

134,888

Accrued expenses

276,769

206,360

Dividends payable

52,697

49,469

Income and other taxes payable

73,587

68,650

Deferred income taxes - current

6,043

5,427

Total current liabilities

694,870

464,794

Deferred income taxes - noncurrent

84,834

82,919

Other noncurrent liabilities

169,462

151,876

Stockholders' equity:

Preferred stock (no par value)

Authorized - 20,000 shares

Issued - None

Common stock (no par value)

Authorized - 400,000 shares

Issued -

198,868 shares at 9/30/04

191,964 shares at 12/31/03

13,248

12,790

Class B common stock (convertible)

Authorized - 80,000 shares

Issued and outstanding -

33,573 shares at 9/30/04

40,477 shares at 12/31/03

2,248

2,706

Additional paid-in capital

14,383

8,342

Retained earnings

2,371,453

2,152,566

Common stock in treasury, at cost -

(9/30/04 - 8,055 shares; 12/31/03 - 7,581 shares)

(363,979)

(320,450)

Accumulated other comprehensive income (loss):

Foreign currency translation adjustment

(31,675)

(42,692)

Gain (loss) on derivative contracts

698

(1,902)

Unrealized holding gains on marketable

equity securities

9,414

9,461

Total accumulated other comprehensive income (loss)

(21,563)

(35,133)

Total stockholders' equity

2,015,790

1,820,821

Total liabilities & stockholders' equity

$

2,964,956

2,520,410

All amounts in thousands.

Notes to financial statements beginning on page 5 are an integral part of these statements.

4

Table of Contents

FORM 10-Q
PART I - FINANCIAL INFORMATION - ITEM 1 (Cont'd)
WM. WRIGLEY JR. COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONDENSED)
(Unaudited)

1.

The Consolidated Statement of Earnings (Condensed) for the three month and nine month periods ended September 30, 2004 and 2003, respectively, the Consolidated Statement of Cash Flows (Condensed) for the nine month periods ended September 30, 2004 and 2003, and the Consolidated Balance Sheet (Condensed) at September 30, 2004, are unaudited. In the Company's opinion, the accompanying financial statements reflect all normal and recurring adjustments necessary to present fairly the results for the periods and have been prepared on a basis consistent with the 2003 audited consolidated financial statements. These condensed financial statements should be read in conjunction with the 2003 audited consolidated financial statements and related notes, which are an integral part thereof. Certain amounts recorded in 2003 have been reclassified to conform to the 2004 presentation.

2.

Conformity with generally accepted accounting principles requires management to make estimates and assumptions when preparing financial statements that affect assets, liabilities, revenues and expenses. Actual results may vary from those estimates.

3.

On April 1, 2004, the Company completed its transaction with Agrolimen, a privately-held Spanish conglomerate, to acquire certain confectionery businesses of the Joyco Group (Joyco). Cash consideration, including direct acquisition costs, totaled $263 million, net of cash acquired. The acquisition was funded by a $130 million draw on the $300 million line of credit the Company negotiated for purposes of this transaction with the remaining amount of $133 million funded from the Company's available cash. This transaction strengthens the Company's operations in key geographies such as Spain, India and China through a broader confectionery brand portfolio, access to additional distribution channels and enhanced manufacturing capabilities. These opportunities along with the synergies from combining the operations of the Company with those of Joyco were key factors associated with the determination of the purchase price and related goodwill. The results of operations for the b usinesses acquired have been included in the consolidated financial results of the Company since April 1, 2004.

The acquisition has been accounted for under Statement of Financial Accounting Standards (SFAS) No. 141, "Business Combinations", and accordingly the purchase method of accounting has been used. The Company has recorded a preliminary allocation of the purchase price as of April 1, 2004 as the process of obtaining independent valuations of property, plant and equipment, the fair value of the intangible assets and the remaining useful lives of these assets is not completed. This will result in potential adjustments to the carrying values of Joyco's recorded assets and liabilities, establishment of certain intangible assets, some of which may have indefinite lives not subject to amortization, and the determination of the amount of any residual value that will be allocated to goodwill. The preliminary allocation of the purchase price included in the current period balance sheet is based on the best estimates of management and is subject to revision based on final determination of fair values. The Company also is completing its analysis of integration plans that may result in additional purchase price allocation adjustments.

The following table includes the unaudited pro forma combined net sales for the third quarter and first nine months as if the Company had acquired the confectionery businesses of Joyco as of January 1, 2003. In determining the unaudited pro forma amounts, income taxes, interest expense, and depreciation and amortization of assets have been adjusted to the accounting base recognized for each in recording the combination. The impact on operating income, net earnings and earnings per share was not significant. There are no material, nonrecurring items included in the pro forma results of operations.

Three Months Ended

Nine Months Ended

9/30/2004

9/30/2003

9/30/2004

9/30/2003

Net Sales

$

916,675

831,190

2,752,133

2,407,036

All amounts in thousands.

The pro forma results are not necessarily indicative of what actually would have occurred if the acquisition had been completed as of the beginning of 2003, nor are they necessarily indicative of future consolidated results.

5

Table of Contents

FORM 10-Q
PART I - FINANCIAL INFORMATION - ITEM 1 (Cont'd)
WM. WRIGLEY JR. COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONDENSED)
(Unaudited)

4.

In connection with the Joyco acquisition, the Company entered into a $300 million unsecured line of credit under which initially $130 million has been borrowed as of April 1, 2004. The interest rate on the line of credit is variable and is indexed to the LIBOR rate. The Company pays an annual facility fee and additional fees based on amounts drawn. The line of credit expires on March 19, 2007.

5.

The increase in goodwill is primarily due to the preliminary allocation of goodwill related to the acquisition of Joyco, which is subject to revision based on final determination of fair values and completion of integration plan analysis.

6.

In the third quarter 2004, the Company continued to apply Accounting Principles Board Opinion (APB) No. 25 and related interpretations in accounting for stock-based compensation plans. APB No. 25 requires the use of the intrinsic value method, which measures compensation cost as the excess of the quoted market price of the stock at the date of grant over that amount an employee must pay to acquire the stock. As the exercise price equaled the fair market value on the date of grant, no compensation expense has been recognized for the Wrigley Stock Option program. The following table illustrates the effect on net earnings and earnings per share if the Company had applied the fair value recognition provisions of the SFAS No. 123, to stock compensation plans.

Three Months Ended

Nine Months Ended

9/30/2004

9/30/2003

9/30/2004

9/30/2003

Net earnings as reported

$

125,776

113,068

375,964

336,017

Add:

Stock-based compensation expense included in net earnings, net of tax

2,269

1,928

8,964

6,117

Deduct:

Total stock-based compensation expense determined under fair value method for all awards, net of tax

(6,168)

(5,776)

(19,880)

(16,846)

Pro forma net earnings

$

121,877

109,220

365,048

325,288

Basic and diluted earnings per share

As reported

$

0.56

0.50

1.67

1.49

Pro forma

$

0.54

0.49

1.62

1.45

All amounts in thousands except per share values.