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8-K - FORM 8-K - JABIL INCd933851d8k.htm

Exhibit 99.1

 

LOGO

Jabil Announces Third Quarter Results

Company Maintains Full-Year Core EPS Outlook of $2 per Share

St. Petersburg, FL – June 17, 2015...Today Jabil Circuit, Inc. (NYSE: JBL), reported preliminary, unaudited financial results for its third quarter of fiscal year 2015. The company reported third quarter net revenue of $4.4 billion, a 15 percent increase from the third quarter of fiscal year 2014.

“We continue to make great progress as we further diversify our business, and our fiscal third quarter is another good indication that we’re executing against our growth strategy. During the quarter, our Electronics Manufacturing Services segment delivered strong operating performance, while our Diversified Manufacturing Services segment increased revenue by 41 percent year over year,” said Mark T. Mondello, Chief Executive Officer. “I’m pleased with our performance year to date and I believe we’re well-positioned and poised to capture further growth in fiscal 2016,” he added.

U.S. generally accepted accounting principles (U.S. GAAP) operating income for the third quarter was $135.4 million and U.S. GAAP net diluted earnings per share was $0.37. Core operating income (as defined below) was $160.5 million and core diluted earnings per share (as defined below) was $0.49.

Jabil’s two reporting segments delivered the following revenue results for the company’s third fiscal quarter:

 

    Electronics Manufacturing Services: $2.8 billion.

 

    Diversified Manufacturing Services: $1.6 billion.

(Definitions used: “U.S. GAAP” means U.S. generally accepted accounting principles. Jabil defines core operating income as U.S. GAAP operating income before amortization of intangibles, stock-based compensation expense and related charges, restructuring and related charges, distressed customer charges, acquisition costs and certain purchase accounting adjustments, loss on disposal of subsidiaries, settlement of receivables and related charges, impairment of notes receivable and related charges and goodwill impairment charges. Jabil defines core earnings as U.S. GAAP net income before amortization of intangibles, stock-based compensation expense and related charges, restructuring and related charges, distressed customer charges, acquisition costs and certain purchase accounting adjustments, loss on disposal of subsidiaries, settlement of receivables and related charges, impairment of notes receivable and related charges, goodwill impairment charges, income (loss) from discontinued operations, gain (loss) on sale of discontinued operations and certain other expenses, net of tax and certain deferred tax valuation allowance charges. Jabil defines core diluted earnings per share as core earnings divided by the weighted average number of outstanding diluted shares as determined under U.S. GAAP. Jabil calculates its core return on invested capital by annualizing its after-tax core operating income for its most recently ended quarter and dividing that by a two quarter average of its net invested capital base. Jabil reports core operating income, core earnings, core diluted and basic earnings per share and core return on invested capital to provide investors an additional method for assessing operating income, earnings, diluted earnings per share and return on invested capital from what it believes are its core manufacturing operations. See the accompanying reconciliation of Jabil’s core operating income to its U.S. GAAP operating income, its calculation of core earnings and core diluted earnings per share to its U.S. GAAP net income and U.S. GAAP earnings per share, its calculation of core return on invested capital and additional information in the supplemental information.)


Quarterly Results

Q3 2015 Q3 2014

Net revenue

$4.4 billion $3.8 billion

U.S. GAAP operating income (loss)

$135.4 million $(1.6) million

U.S. GAAP net income

$72.2 million $188.3 million

U.S. GAAP net diluted earnings per share

$0.37 $0.93

U.S. GAAP return on invested capital

13.9% (2.6)%

Core operating income

$160.5 million $45.3 million

Core earnings (loss)

$96.5 million $(11.3) million

Core diluted earnings (loss) per share

$0.49 $(0.06)

Core return on invested capital

17.1% 2.6%

 

Business Update

“We’re on track to deliver approximately 13 percent revenue growth and $2.00 in core earnings per share for this fiscal year, all while continuing to invest for future growth - quite an accomplishment when one considers the current macro environment,” Mondello said. Management updated its fiscal year 2015 revenue outlook of $17.7 billion - $17.9 billion and core earnings per share of $1.95 - $2.05.

Fourth quarter fiscal 2015 guidance:

 

•    Net revenue

$4.45 billion to $4.65 billion

•    U.S. GAAP operating income

$107 million to $140 million

•    U.S. GAAP net diluted earnings per share

$0.27 to $0.38 per diluted share

•    Core operating income

$135 million to $165 million

•    Core diluted earnings per share

$0.40 to $0.50 per diluted share

•    Diversified Manufacturing Services

Increase revenue 35 percent year over year

•    Electronics Manufacturing Services

Increase revenue 1.5 percent year over year

(U.S. GAAP net diluted earnings per share for the fourth quarter of fiscal year 2015 are currently estimated to include $0.03 per share for amortization of intangibles, $0.08 per share for stock-based compensation expense and related charges and $0.02 to $0.01 per share for restructuring and related charges.)

FORWARD LOOKING STATEMENT: This news release contains forward-looking statements, including those regarding our anticipated financial results for our third quarter of fiscal year 2015; our positioning for, and ability to capture future growth, in fiscal 2016; our delivery of revenue growth and core earnings per share for fiscal 2015; our continuing to invest for future growth; our currently expected fiscal year 2015 revenues and core earnings per share; and our currently expected fourth quarter of fiscal year 2015 net revenue (including that of our segments), core and U.S. GAAP operating income, core and U.S. GAAP diluted earnings per share results and the components thereof. The statements in this news release are based on current expectations, forecasts and assumptions involving risks and uncertainties that could cause actual outcomes and results to differ materially. These risks and uncertainties include, but are not limited to: our determination as we finalize our financial results for our third quarter of fiscal year 2015 that our financial results and conditions differ from our current preliminary unaudited numbers set forth herein; fluctuations in our stock’s market price; fluctuations in operating results and cash flows; unexpected, adverse seasonal impacts on demand; changes in macroeconomic conditions, both in the U.S. and internationally; the occurrence of, success and expected financial results from, product ramps; our financial performance during and after the current economic conditions; our ability to maintain and improve costs, quality and delivery for our customers; risks and costs inherent in litigation; whether our realignment of our capacity will adversely affect our cost structure, ability to service customers and labor relations; our ability to take advantage of perceived benefits of offering customers vertically integrated services; changes in technology; competition; anticipated growth for us and our industry that may not occur; managing rapid growth; managing rapid declines in customer demand and other related customer challenges that may occur; our ability to successfully consummate acquisitions and divestitures; managing the integration of businesses we acquire; risks associated with international sales and operations; retaining key personnel; our dependence on a limited number of large customers; business and competitive factors generally affecting the electronic manufacturing services industry, our customers and our business; other factors that we may not have currently identified or quantified; and other risks, relevant factors and uncertainties identified in our Annual Report on Form 10-K for the fiscal year ended August 31, 2014, subsequent Reports on Forms 10-Q and 8-K and our other securities filings. Jabil disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.


Supplemental Information: The financial results disclosed in this release include certain measures calculated and presented in accordance with U.S. GAAP. In addition to the U.S. GAAP financial measures, Jabil provides supplemental, non-U.S. GAAP financial measures to facilitate evaluation of Jabil’s core operating performance. The non-U.S. GAAP financial measures disclosed in this release exclude certain amounts that are included in the most directly comparable U.S. GAAP measures. The non-U.S. GAAP or core financial measures disclosed in this release do not have standard meanings and may vary from the non-U.S. GAAP financial measures used by other companies. Management believes core financial measures (which exclude the effects of the amortization of intangibles, stock-based compensation expense and related charges, restructuring and related charges, distressed customer charges, acquisition costs and certain purchase accounting adjustments, loss on disposal of subsidiaries, settlement of receivables and related charges, impairment of notes receivable and related charges, goodwill impairment charges, income (loss) from discontinued operations, gain (loss) on sale of discontinued operations and certain other expenses, net of tax and certain deferred tax valuation allowance charges) are a useful measure that facilitates evaluating the past and future performance of Jabil’s ongoing operations on a comparable basis. Jabil reports core operating income, core return on invested capital, core earnings and core diluted and basic earnings per share to provide investors an additional method for assessing operating income, earnings and earnings per share from what it believes are its core manufacturing operations. Included in this release are Condensed Consolidated Statements of Operations as well as a reconciliation of the disclosed core financial measures to the most directly comparable U.S. GAAP financial measures.

Company Conference Call Information: Jabil will hold a conference call to discuss the third quarter of fiscal year 2015 earnings today at 4:30 p.m. ET live on the Internet at http://www.jabil.com. The call will be recorded and archived on the web at http://www.jabil.com. A taped replay of the conference call will also be available June 17, 2015 at approximately 7:30 p.m. ET through midnight on June 24, 2015. To access the replay, call (855) 859-2056 from within the United States, or (404) 537-3406 outside the United States. The pass code is: 51814878. An archived webcast of the conference call will be available at http://www.jabil.com/investors/.

About Jabil

Jabil is an electronic product solutions company providing comprehensive electronics design and manufacturing product management services to global electronics and technology companies. Offering complete product supply chain management from facilities in 25 countries, Jabil provides comprehensive, individualized-focused solutions to customers in a broad range of industries. Jabil common stock is traded on the New York Stock Exchange under the symbol, “JBL”. Further information is available on Jabil’s website: jabil.com.

Investor & Media Contact:

Beth Walters

Senior Vice President, Investor Relations & Communications

Jabil Circuit, Inc.

(727) 803-3511

beth_walters@jabil.com


JABIL CIRCUIT, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

 

     May 31,        
     2015     August 31,  
     (Unaudited)     2014  
ASSETS     

Current assets:

    

Cash and cash equivalents

   $ 962,794      $ 1,000,249   

Accounts receivable, net

     1,208,351        1,208,516   

Inventories

     2,260,736        2,008,077   

Prepaid expenses and other current assets

     998,344        1,057,562   

Deferred income taxes

     72,416        64,944   

Assets of discontinued operations

     —          19,669   
  

 

 

   

 

 

 

Total current assets

  5,502,641      5,359,017   

Property, plant and equipment, net

  2,593,457      2,271,705   

Goodwill and intangible assets, net

  658,972      627,700   

Deferred income taxes

  93,465      92,702   

Other assets

  116,998      128,622   
  

 

 

   

 

 

 

Total assets

$ 8,965,533    $ 8,479,746   
  

 

 

   

 

 

 
LIABILITIES AND EQUITY

Current liabilities:

Current installments of notes payable, long-term debt and capital lease obligations

$ 11,365    $ 12,960   

Accounts payable

  3,298,917      3,060,814   

Accrued expenses

  1,410,824      1,235,106   

Deferred income taxes

  5,436      5,094   

Liabilities of discontinued operations

  —        7,123   
  

 

 

   

 

 

 

Total current liabilities

  4,726,542      4,321,097   

Notes payable, long-term debt and capital lease obligations, less current installments

  1,659,862      1,669,585   

Other liabilities

  85,378      79,471   

Income tax liabilities

  96,197      87,555   

Deferred income taxes

  66,616      61,670   
  

 

 

   

 

 

 

Total liabilities

  6,634,595      6,219,378   
  

 

 

   

 

 

 

Commitments and contingencies

Equity:

Jabil Circuit, Inc. stockholders’ equity:

Preferred stock

  —        —     

Common stock

  246      244   

Additional paid-in capital

  1,936,416      1,874,219   

Retained earnings

  1,397,187      1,245,772   

Accumulated other comprehensive (loss) income

  (9,244   86,962   

Treasury stock, at cost

  (1,012,945   (965,369
  

 

 

   

 

 

 

Total Jabil Circuit, Inc. stockholders’ equity

  2,311,660      2,241,828   

Noncontrolling interests

  19,278      18,540   
  

 

 

   

 

 

 

Total equity

  2,330,938      2,260,368   
  

 

 

   

 

 

 

Total liabilities and equity

$ 8,965,533    $ 8,479,746   
  

 

 

   

 

 

 


JABIL CIRCUIT, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except for per share data)

(Unaudited)

 

     Three months ended     Nine months ended  
     May 31,     May 31,     May 31,     May 31,  
     2015     2014     2015     2014  

Net revenue

   $ 4,358,641      $ 3,785,875      $ 13,218,382      $ 11,705,901   

Cost of revenue

     3,982,804        3,569,925        12,091,739        10,942,550   
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

  375,837      215,950      1,126,643      763,351   

Operating expenses:

Selling, general and administrative

  228,476      190,804      653,183      497,796   

Research and development

  6,997      5,729      19,502      21,387   

Amortization of intangibles

  5,724      5,679      17,097      18,180   

Restructuring and related charges

  (782   12,446      31,833      65,652   

Loss on disposal of subsidiaries

  —        2,905      —        2,905   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss)

  135,422      (1,613   405,028      157,431   

Interest and other, net

  31,041      32,567      94,670      99,708   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) from continuing operations before tax

  104,381      (34,180   310,358      57,723   

Income tax expense

  32,124      18,708      107,186      40,923   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) from continuing operations, net of tax

  72,257      (52,888   203,172      16,800   
  

 

 

   

 

 

   

 

 

   

 

 

 

Discontinued operations:

(Loss) income from discontinued operations, net of tax

  (1,514   2,699      (5,224   21,515   

Gain (loss) on sale of discontinued operations, net of tax

  1,681      238,497      (875   229,542   
  

 

 

   

 

 

   

 

 

   

 

 

 

Discontinued operations, net of tax

  167      241,196      (6,099   251,057   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

  72,424      188,308      197,073      267,857   

Net income attributable to noncontrolling interests, net of tax

  221      53      756      347   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income attributable to Jabil Circuit, Inc.

$ 72,203    $ 188,255    $ 196,317    $ 267,510   
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per share attributable to the stockholders of Jabil Circuit, Inc.:

  

Basic:

Income (loss) from continuing operations, net of tax

$ 0.37    $ (0.26 $ 1.05    $ 0.08   
  

 

 

   

 

 

   

 

 

   

 

 

 

Discontinued operations, net of tax

$ —      $ 1.19    $ (0.03 $ 1.23   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

$ 0.37    $ 0.93    $ 1.01    $ 1.31   
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted:

Income (loss) from continuing operations, net of tax

$ 0.37    $ (0.26 $ 1.03    $ 0.08   
  

 

 

   

 

 

   

 

 

   

 

 

 

Discontinued operations, net of tax

$ —      $ 1.19    $ (0.03 $ 1.22   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

$ 0.37    $ 0.93    $ 1.00    $ 1.30   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average shares outstanding:

Basic

  193,785      202,008      193,617      203,995   
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

  196,304      202,008      195,793      205,699   
  

 

 

   

 

 

   

 

 

   

 

 

 


JABIL CIRCUIT, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)

 

     Nine months ended  
     May 31,     May 31,  
     2015     2014  

Cash flows from operating activities:

    

Net income

   $ 197,073      $ 267,857   

Adjustments to reconcile net income to net cash provided by operating activities:

    

Depreciation and amortization

     385,136        366,622   

Gain on sale of discontinued operations

     —          (239,320

Restructuring and related charges

     4,567        30,015   

Provision for allowance for doubtful accounts

     8,193        15,078   

Recognition of stock-based compensation expense and related charges

     53,101        8,257   

Deferred income taxes

     (14,143     (25,115

Loss (gain) on sale of property, plant and equipment

     10,045        (2,814

Other, net

     9,856        7,786   

Change in operating assets and liabilities, exclusive of net assets acquired:

    

Accounts receivable

     (43,982     102,708   

Inventories

     (253,579     315,254   

Prepaid expenses and other current assets

     37,687        249,951   

Other assets

     14,417        (16,892

Accounts payable, accrued expenses and other liabilities

     474,550        (669,999
  

 

 

   

 

 

 

Net cash provided by operating activities

  882,921      409,388   
  

 

 

   

 

 

 

Cash flows from investing activities:

Cash paid for business and intangible asset acquisitions, net of cash

  (78,007   —     

Proceeds from sale of discontinued operations, net of cash

  9,663      544,495   

Acquisition of property, plant and equipment

  (735,459   (414,729

Proceeds from sale of property, plant and equipment

  13,187      141,082   

Other, net

  (6,645   —     
  

 

 

   

 

 

 

Net cash (used in) provided by investing activities

  (797,261   270,848   
  

 

 

   

 

 

 

Cash flows from financing activities:

Borrowings under debt agreements

  4,723,083      5,171,880   

Payments toward debt agreements

  (4,731,894   (5,336,697

Payments to acquire treasury stock

  (40,040   (129,063

Dividends paid to stockholders

  (47,623   (52,162

Treasury stock minimum tax withholding related to vesting of restricted stock

  (7,536   (34,162

Other, net

  8,905      5,738   
  

 

 

   

 

 

 

Net cash used in financing activities

  (95,105   (374,466
  

 

 

   

 

 

 

Effect of exchange rate changes on cash and cash equivalents

  (28,010   5,123   
  

 

 

   

 

 

 

Net (decrease) increase in cash and cash equivalents

  (37,455   310,893   

Cash and cash equivalents at beginning of period

  1,000,249      1,011,373   
  

 

 

   

 

 

 

Cash and cash equivalents at end of period

$ 962,794    $ 1,322,266   
  

 

 

   

 

 

 


JABIL CIRCUIT, INC. AND SUBSIDIARIES

SUPPLEMENTAL DATA

RECONCILIATION OF U.S. GAAP FINANCIAL RESULTS TO NON-U.S. GAAP MEASURES

(in thousands, except for per share data)

(Unaudited)

 

     Three months ended     Nine months ended  
     May 31,     May 31,     May 31,      May 31,  
     2015     2014     2015      2014  

Operating income (loss) (U.S. GAAP)

   $ 135,422      $ (1,613   $ 405,028       $ 157,431   

Amortization of intangibles

     5,724        5,679        17,097         18,180   

Stock-based compensation expense and related charges

     20,094        14,561        53,106         6,627   

Restructuring and related charges

     (782     12,446        31,833         65,652   

Distressed customer charges

     —          11,371        —           15,113   

Loss on disposal of subsidiaries

     —          2,905        —           2,905   
  

 

 

   

 

 

   

 

 

    

 

 

 

Core operating income (Non-U.S. GAAP)

$ 160,458    $ 45,349    $ 507,064    $ 265,908   
  

 

 

   

 

 

   

 

 

    

 

 

 

Net income attributable to Jabil Circuit, Inc. (U.S. GAAP)

$ 72,203    $ 188,255    $ 196,317    $ 267,510   

Amortization of intangibles, net of tax

  5,528      5,661      16,893      15,084   

Stock-based compensation expense and related charges, net of tax

  19,949      14,298      52,471      5,884   

Restructuring and related charges, net of tax

  (1,029   9,862      31,172      55,443   

Distressed customer charges, net of tax

  —        8,889      —        11,234   

Acquisition costs and certain purchase accounting adjustments, net of tax

  —        —        —        (9,064

Loss on disposal of subsidiaries, net of tax

  —        2,905      —        2,905   

Loss (income) from discontinued operations, net of tax

  1,514      (2,699   5,224      (21,515

(Gain) loss on sale of discontinued operations, net of tax

  (1,681   (238,497   875      (229,542
  

 

 

   

 

 

   

 

 

    

 

 

 

Core earnings (loss) (Non-U.S. GAAP)

$ 96,484    $ (11,326 $ 302,952    $ 97,939   
  

 

 

   

 

 

   

 

 

    

 

 

 

Net earnings per share (U.S. GAAP):

Basic

$ 0.37    $ 0.93    $ 1.01    $ 1.31   
  

 

 

   

 

 

   

 

 

    

 

 

 

Diluted

$ 0.37    $ 0.93    $ 1.00    $ 1.30   
  

 

 

   

 

 

   

 

 

    

 

 

 

Core earnings (loss) per share (Non-U.S. GAAP):

Basic

$ 0.50    $ (0.06 $ 1.56    $ 0.48   
  

 

 

   

 

 

   

 

 

    

 

 

 

Diluted

$ 0.49    $ (0.06 $ 1.55    $ 0.48   
  

 

 

   

 

 

   

 

 

    

 

 

 

Weighted average shares outstanding used in the calculations of earnings per share (U.S. GAAP and Non-U.S. GAAP):

Basic

  193,785      202,008      193,617      203,995   
  

 

 

   

 

 

   

 

 

    

 

 

 

Diluted

  196,304      202,008      195,793      205,699   
  

 

 

   

 

 

   

 

 

    

 

 

 


JABIL CIRCUIT, INC. AND SUBSIDIARIES

SUPPLEMENTAL DATA

RECONCILIATION OF U.S. GAAP FINANCIAL RESULTS TO NON-U.S. GAAP MEASURES

(in thousands)

(Unaudited)

CALCULATION OF RETURN ON INVESTED CAPITAL

AND CORE RETURN ON INVESTED CAPITAL

The Company calculates: (1) its “Return on Invested Capital” by annualizing its “after-tax U.S. GAAP operating income” for its most recently-ended quarter and dividing that by a two quarter average of its “net invested capital asset base” and (2) its “Core Return on Invested Capital” by annualizing its “after-tax non-U.S. GAAP core operating income” for its most recently-ended quarter and dividing that by a two quarter “average net invested capital asset base.”

The Company calculates: (1) its “after-tax U.S. GAAP operating income” by subtracting a certain tax effect (the calculation of which is explained below) from its U.S. GAAP operating income and (2) its “after-tax non-U.S. GAAP core operating income” as its non-U.S. GAAP core operating income less a certain tax effect (the calculation of which is explained below). See elsewhere in this earnings release for a reconciliation of the Company’s non-U.S. GAAP core operating income to its U.S. GAAP operating income.

The Company calculates its “average net invested capital asset base” as the sum of the averages (the calculations of which are explained below) of its stockholders’ equity, current and non-current portions of its notes payable, long-term debt and capital lease obligations less the average (the calculation of which is explained below) of its cash and cash equivalents.

The following table reconciles (1) “Return on Invested Capital,” as calculated using “after-tax U.S. GAAP operating income” to (2) “Core Return on Invested Capital,” as calculated using “after-tax non-U.S. GAAP core operating income”:

 

     Three months ended  
     May 31,     May 31,  
     2015     2014  

Numerator:

    

Operating income (loss) (U.S. GAAP)

   $ 135,422      $ (1,613

Tax effect(1)

     (31,830     (18,456
  

 

 

   

 

 

 

After-tax operating income (loss)

  103,592      (20,069
  x4      x4   
  

 

 

   

 

 

 

Annualized after-tax operating income (loss)

$ 414,368    $ (80,276
  

 

 

   

 

 

 

Core operating income (Non-U.S. GAAP)

$ 160,458    $ 45,349   

Tax effect(2)

  (32,471   (24,921
  

 

 

   

 

 

 

After-tax operating income

  127,987      20,428   
  x4      x4   
  

 

 

   

 

 

 

Annualized after-tax core operating income

$ 511,948    $ 81,712   
  

 

 

   

 

 

 

Denominator:

Average total Jabil Circuit, Inc. stockholders’ equity(3)

$ 2,278,112    $ 2,352,293   

Average notes payable, long-term debt and capital lease obligations, less current installments(3)

  1,661,320      1,673,922   

Average current installments of notes payable, long-term debt and capital lease obligations(3)

  11,312      115,363   

Average cash and cash equivalents(3)

  (964,604   (998,698
  

 

 

   

 

 

 

Net invested capital asset base

$ 2,986,140    $ 3,142,880   
  

 

 

   

 

 

 

Return on Invested Capital (U.S. GAAP)

  13.9   (2.6 )% 

Adjustments noted above

  3.2   5.2

Core Return on Invested Capital (Non-U.S. GAAP)

  17.1   2.6

 

(1) This amount is calculated by adding the amount of income taxes attributable to its operating income (U.S. GAAP) and its interest expense.
(2) This amount is calculated by adding the amount of income taxes attributable to its core operating income (Non-U.S. GAAP) and its interest expense.
(3) The average is based on the addition of the account balance at the end of the most recently-ended quarter to the account balance at the end of the prior quarter and dividing by two.