# UNITED	STATES

# SECURITIES	AND	EXCHANGE	COMMISSION

# (Mark	One)

# ANNUAL	REPORT	PURSUANT	TO	SECTION	13	OR	15(d)	OF	THE	SECURITIES	EXCHANGE	ACT	OF	1934

For	the	fiscal	year	ended	December	29,	2018

# TRANSITION	REPORT	PURSUANT	TO	SECTION	13	OR	15(d)	OF	THE	SECURITIES	EXCHANGE	ACT	OF	1934

kraftheinzlogo35.jpg

# The	Kraft	Heinz	Company

(Exact	name	of	registrant	as	specified	in	its	charter)

Delaware

(State	or	other	jurisdiction	of	incorporation	or	organization)

One	PPG	Place,	Pittsburgh,	Pennsylvania

(Address	of	Principal	Executive	Offices)

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

(Zip	Code)

Registrant's	telephone	number,	including	area	code:	(412)	456-5700

# Securities	registered	pursuant	to	Section	12(b)	of	the	Act:

# Securities	registered	pursuant	to	Section	12(g)	of	the	Act:

None.

Indicate	by	check	mark	if	the	registrant	is	a	well-known	seasoned	issuer,	as	defined	in	Rule	405	of	the	Securities	Act.	Yes	o	No	x

Indicate	by	check	mark	if	the	registrant	is	not	required	to	file	reports	pursuant	to	Section	13	or	Section	15(d)	of	the	Act.	Yes	o	No	x

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	o	No	x

Indicate	by	check	mark	whether	the	registrant	has	submitted	electronically	every	Interactive	Data	File	required	to	be	submitted	pursuant	to	Rule	405	of	Regulation	S-T (§	232.405	of	this	chapter)	during	the	preceding	12	months	(or	for	such	shorter	period	that	the	registrant	was	required	to	submit	such	files).	Yes	o	No	x

Indicate	by	check	mark	whether	the	registrant	is	a	large	accelerated	filer,	an	accelerated	filer,	a	non-accelerated	filer,	a	smaller	reporting	company,	or	an	emerging	growth company.	See	the	definitions	of	"large	accelerated	filer,"	"accelerated	filer,"	"smaller	reporting	company,"	and	"emerging	growth	company"	in	Rule	12b-2	of	the Exchange	Act.

# Large	accelerated	filer	x

# Accelerated	filer	o

# Non-accelerated	filer	o Smaller	reporting	company	o Emerging	growth	company	o

If	an	emerging	growth	company,	indicate	by	check	mark	if	the	registrant	has	elected	not	to	use	the	extended	transition	period	for	complying	with	any	new	or	revised financial	accounting	standards	provided	pursuant	to	Section	13(a)	of	the	Exchange	Act.	o

Indicate	by	check	mark	whether	the	registrant	is	a	shell	company	(as	defined	in	Rule	12b-2	of	the	Exchange	Act).	Yes	o	No	x

The	aggregate	market	value	of	the	shares	of	common	stock	held	by	non-affiliates	of	the	registrant,	computed	by	reference	to	the	closing	price	of	such	stock	as	of	the	last business	day	of	the	registrant's	most	recently	completed	second	quarter,	was	$38	billion.	As	of	June	5,	2019,	there	were	1,219,938,804	shares	of	the	registrant's	common stock	outstanding.

| PART	I | 6 |
| :--- | :--- |
| Item\t1.\tBusiness. | 6 |
| Item\t1A.\tRisk\tFactors. | 11 |
| Item\t1B.\tUnresolved\tStaff\tComments. | 25 |
| Item\t2.\tProperties. | 25 |
| Item\t3.\tLegal\tProceedings. | 25 |
| Item\t4.\tMine\tSafety\tDisclosures. | 25 |
| PART\tII | 25 |
| Item\t5.\tMarket\tfor\tRegistrant's\tCommon\tEquity,\tRelated\tStockholder\tMatters\tand\tIssuer\tPurchases\tof\tEquity\tSecurities. | 25 |
| Item\t6.\tSelected\tFinancial\tData. | 27 |
| Item\t7.\tManagement's\tDiscussion\tand\tAnalysis\tof\tFinancial\tCondition\tand\tResults\tof\tOperations. | 28 |
| Overview | 28 |
| Consolidated\tResults\tof\tOperations | 30 |
| Results\tof\tOperations\tby\tSegment | 34 |
| Critical\tAccounting\tEstimates | 39 |
| New\tAccounting\tPronouncements | 43 |
| Contingencies | 43 |
| Commodity\tTrends | 43 |
| Liquidity\tand\tCapital\tResources | 43 |
| Off-Balance\tSheet\tArrangements\tand\tAggregate\tContractual\tObligations | 46 |
| Equity\tand\tDividends | 47 |
| Non-GAAP\tFinancial\tMeasures | 47 |
| Supplemental\tUnaudited\tQuarterly\tFinancial\tInformation | 53 |
| Item\t7A.\tQuantitative\tand\tQualitative\tDisclosures\tabout\tMarket\tRisk. | 56 |
| Item\t8.\tFinancial\tStatements\tand\tSupplementary\tData. | 58 |
| Report\tof\tIndependent\tRegistered\tPublic\tAccounting\tFirm | 58 |
| Consolidated\tStatements\tof\tIncome | 60 |
| Consolidated\tStatements\tof\tComprehensive\tIncome | 61 |
| Consolidated\tBalance\tSheets | 62 |
| Consolidated\tStatements\tof\tEquity | 63 |
| Consolidated\tStatements\tof\tCash\tFlows | 64 |
| Notes\tto\tConsolidated\tFinancial\tStatements | 66 |
| Note\t1.\tBasis\tof\tPresentation | 66 |
| Note\t2.\tRestatement\tof\tPreviously\tIssued\tConsolidated\tFinancial\tStatements | 67 |
| Note\t3.\tSignificant\tAccounting\tPolicies | 82 |
| Note\t4.\tNew\tAccounting\tStandards | 86 |
| Note\t5.\tAcquisitions\tand\tDivestitures | 89 |
| Note\t6.\tIntegration\tand\tRestructuring\tExpenses | 92 |
| Note\t7.\tRestricted\tCash | 94 |
| Note\t8.\tInventories | 94 |
| Note\t9.\tProperty,\tPlant\tand\tEquipment | 95 |
| Note\t10.\tGoodwill\tand\tIntangible\tAssets | 95 |
| Note\t11.\tIncome\tTaxes | 99 |
| Note\t12.\tEmployees'\tStock\tIncentive\tPlans | 103 |
| Note\t13.\tPostemployment\tBenefits | 106 |
| Note\t14.\tFinancial\tInstruments | 116 |
| Note\t15.\tAccumulated\tOther\tComprehensive\tIncome/(Loss) | 121 |
| Note\t16.\tVenezuela\t-\tForeign\tCurrency\tand\tInflation | 123 |

| Note	17.	Financing	Arrangements | 124 |
| :--- | :--- |
| Note\t18.\tCommitments\tand\tContingencies | 125 |
| Note\t19.\tDebt | 127 |
| Note\t20.\tCapital\tStock | 130 |
| Note\t21.\tEarnings\tPer\tShare | 131 |
| Note\t22.\tSegment\tReporting | 131 |
| Note\t23.\tQuarterly\tFinancial\tData\t(Unaudited) | 134 |
| Note\t24.\tSupplemental\tGuarantor\tInformation | 200 |
| Item\t9.\tChanges\tin\tand\tDisagreements\tWith\tAccountants\ton\tAccounting\tand\tFinancial\tDisclosure. | 215 |
| Item\t9A.\tControls\tand\tProcedures. | 215 |
| Item\t9B.\tOther\tInformation. | 217 |
| PART\tIII | 217 |
| Item\t10.\tDirectors,\tExecutive\tOfficers\tand\tCorporate\tGovernance. | 217 |
| Executive\tOfficers | 217 |
| Board\tof\tDirectors | 217 |
| Corporate\tGovernance\tand\tBoard\tMatters | 220 |
| Board\tCommittees\tand\tMembership—Audit\tCommittee | 221 |
| Board\tCommittees\tand\tMembership—Operations\tand\tStrategy\tCommittee | 221 |
| Item\t11.\tExecutive\tCompensation. | 222 |
| Board\tCommittees\tand\tMembership—Compensation\tCommittee | 222 |
| Compensation\tof\tNon-Employee\tDirectors | 223 |
| Compensation\tDiscussion\tand\tAnalysis | 224 |
| Executive\tCompensation\tTables | 231 |
| Pay\tRatio\tDisclosure | 238 |
| Item\t12.\tSecurity\tOwnership\tof\tCertain\tBeneficial\tOwners\tand\tManagement\tand\tRelated\tStockholder\tMatters. | 239 |
| Securities\tAuthorized\tfor\tIssuance\tUnder\tEquity\tCompensation\tPlans | 239 |
| Ownership\tof\tEquity\tSecurities | 239 |
| Item\t13.\tCertain\tRelationships\tand\tRelated\tTransactions,\tand\tDirector\tIndependence. | 241 |
| Independence\tand\tRelated\tPerson\tTransactions | 241 |
| Item\t14.\tPrincipal\tAccounting\tFees\tand\tServices. | 243 |
| PART\tIV | 244 |
| Item\t15.\tExhibits,\tFinancial\tStatement\tSchedules. | 244 |
| Item\t16.\tForm\t10-K\tSummary. | 249 |
| Signatures | 250 |

Unless	the	context	otherwise	requires,	the	terms	"we,"	"us,"	"our,"	"Kraft	Heinz,"	and	the	"Company"	each	refer	to	The	Kraft	Heinz	Company	and	all	of	its	consolidated subsidiaries.

# Forward-Looking	Statements

This	Annual	Report	on	Form	10-K	contains	a	number	of	forward-looking	statements.	Words	such	as	"anticipate,"	"reflect,"	"invest,"	"see,"	"make,"	"expect,"	"give," "deliver,"	 "drive,"	 "believe,"	 "improve,"	 "assess,"	 "reassess,"	 "remain,"	 "evaluate,"	 "grow,"	 "will,"	 "plan,"	 and	 variations	 of	 such	 words	 and	 similar	 future	 or conditional	expressions	are	intended	to	identify	forward-looking	statements.	These	forward-looking	statements	include,	but	are	not	limited	to,	statements	regarding	our plans,	impacts	of	accounting	standards	and	guidance,	growth,	legal	matters,	taxes,	costs	and	cost	savings,	impairments,	and	dividends.	These	forward-looking	statements are	not	guarantees	of	future	performance	and	are	subject	to	a	number	of	risks	and	uncertainties,	many	of	which	are	difficult	to	predict	and	beyond	our	control.

Important	factors	that	may	affect	our	business	and	operations	and	that	may	cause	actual	results	to	differ	materially	from	those	in	the	forward-looking	statements	include, but	are	not	limited	to,	operating	in	a	highly	competitive	industry;	our	ability	to	correctly	predict,	identify,	and	interpret	changes	in	consumer	preferences	and	demand,	to offer	new	products	to	meet	those	changes,	and	to	respond	to	competitive	innovation;	changes	in	the	retail	landscape	or	the	loss	of	key	retail	customers;	changes	in	our relationships	with	significant	customers,	suppliers,	and	other	business	relationships;	our	ability	to	maintain,	extend,	and	expand	our	reputation	and	brand	image;	our ability	to	leverage	our	brand	value	to	compete	against	private	label	products;	our	ability	to	drive	revenue	growth	in	our	key	product	categories,	increase	our	market	share, or	add	products	that	are	in	faster-growing	and	more	profitable	categories;	product	recalls	or	product	liability	claims;	unanticipated	business	disruptions;	our	ability	to identify,	complete,	or	realize	the	benefits	from	strategic	acquisitions,	alliances,	divestitures,	joint	ventures,	or	other	investments;	our	ability	to	realize	the	anticipated benefits	from	prior	or	future	streamlining	actions	to	reduce	fixed	costs,	simplify	or	improve	processes,	and	improve	our	competitiveness;	our	ability	to	successfully execute	our	strategic	initiatives;	the	impacts	of	our	international	operations;	economic	and	political	conditions	in	the	United	States	and	in	various	other	nations	where	we do	business;	changes	in	our	management	team	or	other	key	personnel	and	our	ability	to	hire	or	retain	key	personnel	or	a	highly	skilled	and	diverse	global	workforce; risks	associated	with	information	technology	and	systems,	including	service	interruptions,	misappropriation	of	data,	or	breaches	of	security;	impacts	of	natural	events	in the	locations	in	which	we	or	our	customers,	suppliers,	distributors,	or	regulators	operate;	our	ownership	structure;	our	indebtedness	and	ability	to	pay	such	indebtedness; additional	impairments	of	the	carrying	amounts	of	goodwill	or	other	indefinite-lived	intangible	assets;	exchange	rate	fluctuations;	volatility	in	commodity,	energy,	and other	input	costs;	volatility	in	the	market	value	of	all	or	a	portion	of	the	derivatives	we	use;	increased	pension,	labor	and	people-related	expenses;	compliance	with	laws, regulations,	and	related	interpretations	and	related	legal	claims	or	other	regulatory	enforcement	actions,	including	additional	risks	and	uncertainties	related	to	our restatement	and	any	potential	actions	resulting	from	 the	Securities	and	Exchange	Commission's	ongoing	 investigation,	as	well	as	potential	additional	subpoenas, litigation,	and	regulatory	proceedings;	an	inability	to	remediate	the	material	weaknesses	in	our	internal	control	over	financial	reporting	or	additional	material	weaknesses or	other	deficiencies	in	the	future	or	the	failure	to	maintain	an	effective	system	of	internal	controls;	our	failure	to	prepare	and	timely	file	our	periodic	reports;	the restatement	of	certain	of	our	previously	issued	consolidated	financial	statements,	which	resulted	in	unanticipated	costs	and	may	affect	investor	confidence	and	raise reputational	issues;	our	ability	to	protect	intellectual	property	rights;	tax	law	changes	or	interpretations;	the	impact	of	future	sales	of	our	common	stock	in	the	public markets;	our	ability	to	continue	to	pay	a	regular	dividend	and	the	amounts	of	any	such	dividends;	volatility	of	capital	markets	and	other	macroeconomic	factors.	For additional	information	on	these	and	other	factors	that	could	affect	our	forward-looking	statements,	see	Item	1A,	Risk	Factors.	We	disclaim	and	do	not	undertake	any obligation	to	update	or	revise	any	forward-looking	statement	in	this	report,	except	as	required	by	applicable	law	or	regulation.

# Explanatory	Note

# General

On	May	2,	2019,	management,	in	consultation	with	the	Audit	Committee	of	our	Board	of	Directors,	concluded	that	our	audited	consolidated	financial	statements	and related	disclosures	for	the	fiscal	years	ended	December	30,	2017	and	December	31,	2016	included	in	our	Annual	Reports	on	Form	10-K,	and	each	of	our	unaudited condensed	consolidated	financial	statements	for	the	quarterly	and	year-to-date	periods	in	fiscal	year	2017	and	each	of	our	unaudited	condensed	consolidated	financial statements	for	the	quarterly	and	year-to-date	periods	for	the	nine	months	ended	September	29,	2018	included	in	our	Quarterly	Reports	on	Form	10-Q	(unaudited condensed	consolidated	financial	statements	for	the	quarterly	periods	ended	September	29,	2018,	June	30,	2018,	March	31,	2018,	and	September	30,	2017)	and	Form 10-Q/A	(unaudited	condensed	consolidated	financial	statements	for	the	quarterly	periods	ended	July	1,	2017	and	April	1,	2017)	should	no	longer	be	relied	upon	due	to misstatements	that	are	described	in	greater	detail	below,	and	that	we	would	restate	such	financial	statements	to	make	the	necessary	accounting	corrections.	We	discussed this	conclusion	with	our	independent	registered	public	accounting	firm,	PricewaterhouseCoopers	LLP.

# Restatement

# Restatement	Background

As	described	in	our	Current	Report	on	Form	8-K	filed	with	the	Securities	and	Exchange	Commission	("SEC")	on	May	6,	2019,	management	noted	certain	misstatements contained	in	the	Financial	Statements	relating	principally	to	the	accounting	treatment	for	supplier	contracts	and	related	arrangements.	As	previously	disclosed,	we received	a	subpoena	from	the	SEC	in	October	2018related	to	our	procurement	area,	specifically	the	accounting	policies,	procedures,	and	internal	controls	related	to	our procurement	function,	including,	but	not	limited	to,	agreements,	side	agreements,	and	changes	or	modifications	to	agreements	with	our	suppliers.	Following	the	receipt of	this	subpoena,	we,	together	with	external	counsel	and	forensic	accountants,	and	subsequently,	under	the	oversight	of	the	Audit	Committee	of	our	Board	of	Directors (the	"Audit	Committee"),	conducted	an	internal	investigation	into	the	procurement	area	and	related	matters.	As	a	result	of	the	findings	from	this	internal	investigation, which	is	now	complete	and	which	identified	that	multiple	employees	in	the	procurement	area	engaged	in	misconduct,	we	corrected	prior	period	misstatements	that generally	increased	the	total	cost	of	products	sold	in	prior	financial	periods.	These	misstatements	principally	related	to	the	incorrect	timing	of	when	certain	cost	and rebate	elements	associated	with	supplier	contracts	and	related	arrangements	were	initially	recognized.	The	findings	from	the	internal	investigation	did	not	identify	any misconduct	by	any	member	of	the	senior	management	team.	We	continue	to	cooperate	with	the	SEC	concerning	its	investigation	of	these	matters.

In	connection	with	the	internal	investigation,	we	also	conducted	a	comprehensive	review	of	supplier	contracts	and	related	arrangements	to	identify	other	potential misstatements	in	the	timing	of	the	recognition	of	supplier	rebates,	incentive	payments,	and	pricing	arrangements.	The	review	identified	further	misstatements,	which	we also	investigated	and	have	been	unable	to	conclude	if	they	resulted	from	the	misconduct	described	above.	These	misstatements	were	primarily	related	to	certain	supplier contracts	and	related	arrangements	where	the	allocation	of	value	of	all	or	a	portion	of	rebates	and	up-front	payments	to	contractual	elements	in	the	current	period	should have	been	deferred	and	recognized	over	an	applicable	contractual	period.	We	corrected	these	misstatements	to	defer	the	up-front	consideration	from	suppliers	when	the retention	or	receipt	of	that	consideration	was	contingent	upon	future	events	and	to	correctly	recognize	the	consideration	as	a	reduction	of	cost	of	products	sold	over	the terms	of	the	arrangements	with	the	suppliers.

Our	internal	investigation	and	review	identified	adjustments	that	resulted	in	an	understatement	of	cost	of	products	sold	totaling	$208	million,	 including	$175	million relating	to	the	periods	up	through	September	29,	2018	that	are	being	restated	in	this	Annual	Report	on	Form	10-K.	The	misstatements	of	cost	of	products	sold	related	to our	internal	investigation	and	review	included	$22	million	for	fiscal	year	2018,	$94	million	for	fiscal	year	2017,	$35	million	for	fiscal	year	2016,	and	$24	million	for fiscal	year	2015.	We	do	not	believe	that	the	misstatements	are	quantitatively	material	to	any	period	presented	in	our	prior	financial	statements.	However,	due	to	the qualitative	 nature	 of	 the	 matters	 identified	 in	 our	 internal	 investigation,	 including	 the	 number	 of	 years	 over	 which	 the	 misconduct	 occurred	 and	 the	 number	 of transactions,	 suppliers,	 and	 procurement	 employees	 involved,	 we	 determined	 that	 it	 would	 be	 appropriate	 to	 correct	 the	 misstatements	 in	 our	 previously	 issued consolidated	financial	statements	by	restating	such	financial	statements.	The	restatement	also	included	corrections	for	additional	identified	out-of-period	and	uncorrected misstatements	 in	 the	 impacted	periods.	Accordingly,	 we	 have	 restated	 our	 consolidated	 financial	 statements	 and	 the	 impacted	 amounts	 within	 the	 accompanying footnotes	thereto.

In	addition,	the	statements	of	income	for	fiscal	years	2017	and	2016,	as	previously	reported,	did	not	originally	reflect	the	adoption	of	accounting	standards	update ("ASU")	2017-07	related	to	the	presentation	of	net	periodic	benefit	cost	(pension	and	postretirement	cost).	This	ASU	was	adopted	in	the	first	quarter	of	2018	and	was applied	retrospectively	for	statement	of	income	presentation	of	service	cost	components	and	other	net	periodic	benefit	cost	components.	The	restated	statements	of income	for	fiscal	years	2017	and	2016	reflect	the	retrospective	application	of	ASU	2017-07	and	are	labeled	"As	Recast."

# Restatement	of	Previously	Issued	Consolidated	Financial	Statements

This	Annual	Report	on	Form	10-K	restates	amounts	included	in	the	2017	Annual	Report	described	above,	including	the	audited	consolidated	financial	statements	at December	30,	2017	and	for	the	fiscal	years	ended	December	30,	2017	and	December	31,	2016.	In	addition	to	the	misstatements	related	to	the	supplier	contracts	and related	arrangements,	including	the	misstatements	related	to	lease	classification,	we	corrected	additional	identified	out-of-period	and	uncorrected	misstatements	that	were not	 material,	 individually	 or	 in	 the	 aggregate,	 to	 our	 consolidated	 financial	 statements.	These	misstatements	were	related	 to	customer	 incentive	program	expense misclassifications,	balance	sheet	misclassifications,	income	taxes,	impairments,	and	other	misstatements.

See	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	additional	information.

The	 relevant	 unaudited	 interim	 financial	 information	 for	 the	 quarterly	 periods	 ended	 September	 29,	 2018,	 June	 30,	 2018,	 March	 31,	 2018,	 December	 30,	 2017, September	30,	2017,	July	1,	2017,	and	April	1,	2017,	has	also	been	restated.	The	2018	quarterly	restatements	will	be	effective	with	the	filing	of	our	future	2019 unaudited	interim	condensed	consolidated	financial	statement	filings	in	Quarterly	Reports	on	Form	10-Q.

See	 Note	 23,	 Quarterly	 Financial	 Information	 (Unaudited), in	 Item 8,	Financial	 Statements	 and	 Supplementary	 Data, for such restated information, and see Supplemental	Unaudited	Quarterly	Financial	Information,	 in	Item	7,	Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations,	for additional	interim	financial	information.

Selected	financial	information	for	the	fiscal	year	ended	January	3,	2016	has	also	been	restated.	See	Item	6,	Selected	Financial	Data.

This	restatement	resulted	in	the	following	decreases	to	our	results:

|  | For	the	Nine	Months	Ended | For	the	Year	Ended | For	the	Year	Ended |
| :--- | :--- | :--- | :--- |
|  | September\t29,\n2018 | December\t30,\n2017 | December\t31,\n2016 |
|  |  | (in\tmillions,\texcept\tper\tshare\tdata) |  |
| Net\tincome | $(2) | $(58) | $(36) |
| Adjusted\tEBITDA(a) | (35) | (106) | (79) |
| Diluted\tearnings\tper\tcommon\tshare | — | (0.04) | (0.03) |
| Adjusted\tEPS(a) | (0.01) | (0.05) | (0.02) |

(a) Adjusted	EBITDA	and	Adjusted	EPS	are	non-GAAP	financial	measures.	See	the 	Non-GAAP	Financial	Measures	section	within	Item	7,	Management's	Discussion	and	Analysis	of	Financial

Condition	and	Results	of	Operations,	for	the	related	definitions	and	reconciliations.

# Control	Considerations

In	connection	with	the	restatement,	management	has	assessed	the	effectiveness	of	our	internal	control	over	financial	reporting.	Based	on	this	assessment,	management identified	material	weaknesses	in	our	internal	control	over	financial	reporting	resulting	in	the	conclusion	by	our	Chief	Executive	Officer	and	Chief	Financial	Officer	that our	disclosure	controls	and	procedures	were	not	effective	as	of	December	29,	2018.	Management	has	taken	and	is	taking	additional	steps	to	remediate	the	material weaknesses	in	our	internal	control	over	financial	reporting.	See	Item	9A,	Controls	and	Procedures,	for	additional	information	related	to	these	material	weaknesses	in internal	control	over	financial	reporting	and	the	related	remedial	measures.

# Additional	Information	Specific	to	Goodwill	and	Indefinite-Lived	Intangible	Asset	Impairment

We	announced	on	February	21,	2019	that	as	part	of	our	normal	quarterly	reporting	procedures	and	planning	processes	for	the	fourth	quarter	of	2018,	the	fair	values	of certain	goodwill	and	intangible	assets	were	below	their	carrying	amounts.	As	a	result,	we	announced	non-cash	impairment	losses	of	$15.4	billion	to	lower	the	carrying amount	of	goodwill	in	certain	reporting	units,	primarily	U.S.	Refrigerated	and	Canada	Retail,	and	certain	intangible	assets,	primarily	the	Kraft	and	Oscar	Mayer	brands. As	disclosed	in	our	Current	Report	on	Form	8-K	filed	with	the	SEC	on	May	6,	2019,	we	subsequently	identified	errors	in	the	calculations	performed	in	connection	with the	interim	goodwill	and	indefinite-lived	intangible	asset	impairment	testing	in	the	fourth	quarter	of	2018.	Specifically,	we	identified	certain	errors	in	projected	net	cash flows	and	allocations	to	certain	brands.	Correcting	this	allocation	error	resulted	in	an	increase	to	the	impairment	losses	initially	calculated	for	brands	of	approximately $278	million,	partially	offset	by	a	reduction	to	the	impairment	losses	initially	calculated	for	reporting	units	of	approximately	$171	million.

In	addition,	the	corrections	to	the	carrying	values	on	our	balance	sheet	at	December	29,	2018	recorded	as	part	of	the	correction	of	the	procurement-related	misstatements described	above	resulted	in	an	adjustment	to	the	carrying	amounts	of	certain	reporting	units,	and	therefore	resulted	in	a	reduction	to	goodwill	impairment	losses	of approximately	$92	million.	The	net	impact	of	these	misstatements	was	an	increase	of	approximately	$15	million	from	the	$15.4	billion	total	impairment	losses	in	the fourth	quarter	of	2018	previously	announced	in	our	earnings	release	and	investor	call	on	February	21,	2019.

As	discussed	in	Item	9A,	Controls	and	Procedures,	of	this	Annual	Report	on	Form	10-K,	we	did	not	design	and	maintain	effective	controls	to	reassess	the	level	of precision	used	to	review	the	allocation	of	cash	flow	projections	to	certain	brands	used	as	a	basis	for	performing	our	fourth	quarter	2018	interim	impairment	assessments in	response	to	the	significant	reduction	in,	and	in	certain	instances	elimination	of,	the	excess	fair	value	over	carrying	amount	for	certain	brands	that	resulted	from	the changing	business	environment.	This	material	weakness	resulted	in	the	errors	in	the	calculations	performed	in	connection	with	the	interim	goodwill	and	indefinite-lived intangible	asset	impairment	testing	in	the	fourth	quarter	of	2018,	as	described	above,	because	approximately	five	to	ten	percent	of	cash	flows	were	not	subjected	to	our control	procedures.	This	material	weakness	arose	during	our	interim	impairment	testing	in	the	fourth	quarter	of	2018	due	to	the	significant	reduction	in	excess	fair	value over	carrying	amount	for	certain	brands	as	noted	above,	which	required	us	to	increase	the	percentage	of	cash	flows	subject	to	our	control	procedures	to	nearly	one hundred	percent.	This	did	not	result	in	a	misstatement	of	any	previously	reported	consolidated	financial	statements	but	was	determined	to	be	a	material	weakness	because it	could	have	resulted	in	a	material	misstatement	that	would	not	have	been	prevented	or	detected.

# PART	I

# Item	1.	Business.

For	150	years,	we	have	produced	some	of	the	world's	most	beloved	products	at	The	Kraft	Heinz	Company	(Nasdaq:	KHC).	Our	Vision	is	To	Be	the	Best	Food	Company, Growing	a	Better	World.	We	are	one	of	the	largest	global	food	and	beverage	companies,	with	2018	net	sales	of	approximately	$26	billion.	Our	portfolio	is	a	diverse	mix of	iconic	and	emerging	brands.	As	the	guardians	of	these	brands	and	the	creators	of	innovative	new	products,	we	are	dedicated	to	the	sustainable	health	of	our	people	and our	planet.

On	July	2,	2015,	through	a	series	of	transactions,	we	consummated	the	merger	of	Kraft	Foods	Group,	Inc.	("Kraft")	with	and	into	a	wholly-owned	subsidiary	of	H.J. Heinz	Holding	Corporation	("Heinz")	(the	"2015	Merger").	At	the	closing	of	the	2015	Merger,	Heinz	was	renamed	The	Kraft	Heinz	Company,	and	H.	J.	Heinz	Company changed	its	name	to	Kraft	Heinz	Foods	Company.

Before	the	consummation	of	the	2015	Merger,	Heinz	was	controlled	by	Berkshire	Hathaway	Inc.	("Berkshire	Hathaway")	and	3G	Global	Food	Holdings,	L.P.	("3G Capital")	(together,	the	"Sponsors"),	following	their	acquisition	of	H.	J.	Heinz	Company	on	June	7,	2013.

# Reportable	Segments

We	manage	and	report	our	operating	results	through	four	 segments.	We	 have	three	reportable	segments	defined	by	geographic	region:	United	States,	Canada,	and Europe,	Middle	East,	and	Africa	("EMEA").	Our	remaining	businesses	are	combined	and	disclosed	as	"Rest	of	World."	Rest	of	World	comprises	two	operating	segments: Latin	America	and	Asia	Pacific	("APAC").

Our	segments	reflect	a	change,	effective	in	the	first	quarter	of	our	fiscal	year	2018,	to	reorganize	our	international	businesses	to	better	align	our	global	geographies.	We moved	 our	 Middle	 East	 and	Africa	 businesses	 from	 the	 historical	Asia	 Pacific,	 Middle	 East,	 and	Africa	 ("AMEA")	operating	 segment	 into	 the	 historical	 Europe reportable	segment,	forming	the	new	EMEA	reportable	segment.	The	remaining	businesses	from	the	AMEA	operating	segment	became	the	APAC	operating	segment. We	have	reflected	this	change	in	all	historical	periods	presented.

See	Note	22,	Segment	Reporting,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	our	geographic	financial	information	by	segment.

# Trademarks	and	Intellectual	Property

Our	trademarks	are	material	to	our	business	and	are	among	our	most	valuable	assets.	Depending	on	the	country,	trademarks	generally	remain	valid	for	as	long	as	they	are in	use	or	their	registration	status	is	maintained.	Trademark	registrations	generally	are	for	renewable,	fixed	terms.	Significant	trademarks	by	segment	based	on	net	sales	in 2018	were:

*Used	under	license.	Additionally,	our	license	to	use	the	McCafe	brand	in	Canada	will	expire	in	December	2019.

In	the	fourth	quarter	of	2018,	we	announced	our	plans	to	divest	certain	assets	and	operations,	predominantly	in	Canada	and	India,	including	the	intellectual	property rights to	Cracker	 Barrel	and	P'Tit	 Quebec	in	Canada,	as	well	as	Glucon-D	and	Complan	globally.	 See	 Note	 5,	Acquisitions	and	Divestitures,	in	Item	8,	Financial Statements	and	Supplementary	Data,	for	additional	information	on	these	transactions.

We	sell	certain	products	under	brands	we	license	from	third	parties.	In	2018,	brands	used	under	licenses	from	third	parties	included	Capri	Sun	packaged	drink	pouches for	sale	in	the	United	States,	TGI	Fridays	frozen	snacks	and	appetizers	in	the	United	States	and	Canada,	McCafe	ground,	whole	bean,	and	on-demand	single	cup	coffees in	the	United	States	and	Canada,	and	Taco	Bell	Home	Originals	Mexican-style	food	products	in	U.S.	grocery	stores.	In	addition,	in	our	agreements	with	Mondelēz International,	Inc.	("Mondelēz	International")	following	the	spin-off	of	Kraft	from	Mondelēz	International	in	2012,	we	each	granted	the	other	party	various	licenses	to use	certain	of	our	and	their	respective	intellectual	property	rights	in	named	jurisdictions	for	certain	periods	of	time.

We	also	own	numerous	patents	worldwide.	We	consider	our	portfolio	of	patents,	patent	applications,	patent	licenses	under	patents	owned	by	third	parties,	proprietary trade	secrets,	technology,	know-how	processes,	and	related	intellectual	property	rights	to	be	material	to	our	operations.	Patents,	issued	or	applied	for,	cover	inventions ranging	from	packaging	techniques	to	processes	relating	to	specific	products	and	to	the	products	themselves.	While	our	patent	portfolio	is	material	to	our	business,	the loss	of	one	patent	or	a	group	of	related	patents	would	not	have	a	material	adverse	effect	on	our	business.

Our	issued	patents	extend	for	varying	periods	according	to	the	date	of	the	patent	application	filing	or	grant	and	the	legal	term	of	patents	in	the	various	countries	where patent	protection	is	obtained.	The	actual	protection	afforded	by	a	patent,	which	can	vary	from	country	to	country,	depends	upon	the	type	of	patent,	the	scope	of	its coverage	as	determined	by	the	patent	office	or	courts	in	the	country,	and	the	availability	of	legal	remedies	in	the	country.

# Research	and	Development

Our	research	and	development	focuses	on	achieving	the	following	four	objectives: •product innovations, renovations,	 and	 new technologies to	 meet	 changing	 consumer	 needs	 and	 drive growth;

•world-class and uncompromising food safety, quality, and consistency;

•superior, customer-preferred product and package performance; and

•continuous process improvement and product optimization in pursuit of cost reductions.

# Competition

Our	products	are	sold	in	highly	competitive	marketplaces,	which	have	experienced	increased	concentration	and	the	growing	presence	of	e-commerce	retailers,	large- format	retailers,	and	discounters.	Competitors	include	large	national	and	international	food	and	beverage	companies	and	numerous	local	and	regional	companies.	We compete	with	both	branded	and	private	label	products	sold	by	retailers,	wholesalers,	and	cooperatives.	We	compete	on	the	basis	of	product	quality	and	innovation,	brand recognition	and	loyalty,	service,	the	ability	to	identify	and	satisfy	consumer	preferences,	the	introduction	of	new	products	and	the	effectiveness	of	our	advertising campaigns	and	marketing	programs,	distribution,	shelf	space,	merchandising	support,	and	price.	Improving	our	market	position	or	introducing	new	products	requires substantial	advertising	and	promotional	expenditures.

# Sales	and	Customers

Our	products	are	sold	through	our	own	sales	organizations	and	through	independent	brokers,	agents,	and	distributors	to	chain,	wholesale,	cooperative	and	independent grocery	accounts,	convenience	stores,	drug	stores,	value	stores,	bakeries,	pharmacies,	mass	merchants,	club	stores,	foodservice	distributors,	and	institutions,	including hotels,	restaurants,	hospitals,	health	care	facilities,	and	certain	government	agencies.	Our	products	are	also	sold	online	through	various	e-commerce	platforms	and retailers.	Our	largest	customer,	Walmart	Inc.,	represented	approximately	21%	of	our	net	sales	in	2018,	approximately	21%	of	our	net	sales	in	2017,	and	approximately 22%	of	our	net	sales	in	2016.

Additionally,	we	have	significant	customers	in	different	regions	around	the	world;	however,	none	of	these	customers	are	individually	material	to	our	consolidated business.	In	2018,	the	five	largest	customers	in	our	U.S.	segment	accounted	for	approximately	49%	of	U.S.	segment	net	sales,	the	five	largest	customers	in	our	Canada segment	accounted	for	approximately	71%	of	Canada	segment	net	sales,	and	the	five	largest	customers	in	our	EMEA	segment	accounted	for	approximately	26%	of	our EMEA	segment	net	sales.

# Net	Sales	by	Product	Category

In	2018,	we	reorganized	the	products	within	our	product	categories	to	reflect	how	we	manage	our	business.	We	have	reflected	this	change	for	all	historical	periods presented.	The	product	categories	that	contributed	10%	or	more	to	consolidated	net	sales	in	any	of	the	periods	presented	were:

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Condiments\tand\tsauces | 26% | 25% | 24% |
| Cheese\tand\tdairy | 20% | 21% | 21% |
| Ambient\tfoods | 10% | 10% | 9% |
| Frozen\tand\tchilled\tfoods | 10% | 10% | 10% |
| Meats\tand\tseafood | 10% | 10% | 10% |

# Raw	Materials	and	Packaging

We	manufacture	(and	contract	for	the	manufacture	of)	our	products	from	a	wide	variety	of	raw	materials.	We	purchase	and	use	large	quantities	of	commodities,	including dairy	products,	meat	products,	coffee	beans,	nuts,	tomatoes,	potatoes,	soybean	and	vegetable	oils,	sugar	and	other	sweeteners,	corn	products,	and	wheat	products,	to manufacture	our	products.	In	addition,	we	purchase	and	use	significant	quantities	of	resins,	metals,	and	cardboard	to	package	our	products	and	natural	gas	to	operate	our facilities.	For	commodities	that	we	use	across	many	of	our	product	categories,	such	as	corrugated	paper	and	energy,	we	coordinate	sourcing	requirements	and	centralize procurement	to	leverage	our	scale.	In	addition,	some	of	our	product	lines	and	brands	separately	source	raw	materials	that	are	specific	to	their	operations.	We	source	these commodities	from	a	variety	of	providers,	including	large,	international	producers	and	smaller,	local,	independent	sellers.	Where	appropriate,	we	seek	 to	establish preferred	purchaser	status	and	have	developed	strategic	partnerships	with	many	of	our	suppliers	with	the	objective	of	achieving	favorable	pricing	and	dependable	supply for	many	of	our	commodities.	The	prices	of	raw	materials	and	agricultural	materials	that	we	use	in	our	products	are	affected	by	external	factors,	such	as	global competition	for	resources,	currency	fluctuations,	severe	weather	or	global	climate	change,	consumer,	industrial	or	investment	demand,	and	changes	in	governmental regulation	and	trade,	tariffs,	alternative	energy,	and	agricultural	programs.

Our	procurement	teams	monitor	worldwide	supply	and	cost	trends	so	we	can	obtain	ingredients	and	packaging	needed	for	production	at	competitive	prices.	Although	the prices	of	our	principal	raw	materials	can	be	expected	to	fluctuate,	we	believe	there	will	be	an	adequate	supply	of	the	raw	materials	we	use	and	that	they	are	generally available	from	numerous	sources.	We	use	a	range	of	hedging	techniques	in	an	effort	to	limit	the	impact	of	price	fluctuations	on	many	of	our	principal	raw	materials. However,	we	do	not	fully	hedge	against	changes	in	commodity	prices,	and	our	hedging	strategies	may	not	protect	us	from	increases	in	specific	raw	material	costs.	We actively	monitor	changes	to	commodity	costs	so	that	we	can	seek	to	mitigate	the	effect	through	pricing	and	other	operational	measures.

# Seasonality	and	Working	Capital

Although	crops	constituting	certain	of	our	raw	food	ingredients	are	harvested	on	a	seasonal	basis,	the	majority	of	our	products	are	produced	throughout	the	year.

Seasonal	factors	inherent	in	our	business	change	the	demand	for	products,	including	holidays,	changes	in	seasons,	or	other	annual	events.	While	these	factors	influence our	quarterly	net	sales,	operating	income/(loss),	and	cash	flows	at	the	product	level,	unless	the	timing	of	such	events	shift	period-over-period	(e.g.,	a	shift	in	Easter timing),	this	seasonality	does	not	typically	have	a	significant	effect	on	our	consolidated	results	of	operations	or	segment	results.

For	information	related	to	our	cash	flows	provided	by/(used	for)	operating	activities,	including	working	capital	items,	see	Liquidity	and	Capital	Resources	in	Item	7, Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations,	of	this	report.

# Employees

# Regulation

The	manufacture	and	sale	of	consumer	food	and	beverage	products	is	highly	regulated.	Our	business	operations,	including	the	production,	transportation,	storage, distribution,	sale,	display,	advertising,	marketing,	labeling,	quality	and	safety	of	our	products	and	their	ingredients,	and	our	occupational	safety,	health,	and	privacy practices,	are	subject	to	various	laws	and	regulations.	These	laws	and	regulations	are	administered	by	federal,	state,	and	local	government	agencies	in	the	United	States, as	well	as	government	entities	and	agencies	outside	the	United	States	in	markets	where	our	products	are	manufactured,	distributed	or	sold.	In	the	United	States,	our activities	are	subject	to	regulation	by	various	federal	government	agencies,	including	the	Food	and	Drug	Administration,	U.S.	Department	of	Agriculture,	Federal	Trade Commission,	Department	of	Labor,	Department	of	Commerce,	and	Environmental	Protection	Agency,	as	well	as	various	state	and	local	agencies.	We	are	also	subject	to numerous	similar	and	other	laws	and	regulations	outside	of	the	United	States,	including	but	not	limited	to	laws	and	regulations	governing	food	safety,	health	and	safety, anti-corruption,	and	data	privacy.	In	our	business	dealings,	we	are	also	required	to	comply	with	the	Foreign	Corrupt	Practices	Act	("FCPA"),	the	U.K.	Bribery	Act,	the Trade	Sanctions	Reform	and	Export	Enhancement	Act,	and	various	other	anti-corruption	regulations	in	the	regions	in	which	we	operate.	We	rely	on	legal	and	operational compliance	programs,	as	well	as	in-house	and	outside	counsel,	to	guide	our	businesses	in	complying	with	applicable	laws	and	regulations	of	the	countries	in	which	we	do business.	In	addition,	the	United	Kingdom's	impending	withdrawal	from	the	European	Union	(commonly	referred	to	as	"Brexit")	and	other	regulatory	regime	changes may	add	cost	and	complexity	to	our	compliance	efforts.

# Environmental	Regulation

Our	activities	throughout	the	world	are	highly	regulated	and	subject	to	government	oversight	regarding	environmental	matters.	Various	laws	concerning	the	handling, storage,	and	disposal	of	hazardous	materials	and	the	operation	of	facilities	in	environmentally	sensitive	locations	may	impact	aspects	of	our	operations.

In	the	United	States,	where	a	significant	portion	of	our	business	operates,	these	laws	and	regulations	include	the	Clean	Air	Act,	the	Clean	Water	Act,	the	Resource Conservation	and	Recovery	Act,	and	the	Comprehensive	Environmental	Response,	Compensation,	and	Liability	Act	("CERCLA").	CERCLA	imposes	joint	and	several liability	on	each	potentially	responsible	party.	We	are	involved	in	a	number	of	active	proceedings	in	the	United	States	under	CERCLA	(and	other	similar	state	actions under	similar	legislation)	related	to	our	current	operations	and	certain	closed,	inactive,	or	divested	operations	for	which	we	retain	liability.

As	of	December	29,	2018,	we	had	accrued	an	amount	we	deemed	appropriate	for	environmental	remediation.	Based	on	information	currently	available,	we	believe	that the	ultimate	resolution	of	existing	environmental	remediation	actions	and	our	compliance	in	general	with	environmental	laws	and	regulations	will	not	have	a	material effect	on	our	earnings	or	financial	condition.	However,	it	is	difficult	to	predict	with	certainty	the	potential	impact	of	future	compliance	efforts	and	environmental remedial	actions	and	thus,	future	costs	associated	with	such	matters	may	exceed	current	reserves.

# Information	about	our	Executive	Officers

The	following	are	our	executive	officers	as	of	June	5,	2019	and	all	persons	chosen	to	become	executive	officers	as	of	the	filing	date	of	this	Annual	Report	on	Form	10-K:

Bernardo	Hees	became	Chief	Executive	Officer	upon	the	closing	of	the	2015	Merger.	He	had	previously	served	as	Chief	Executive	Officer	of	Heinz	since	June	2013. Previously,	Mr.	Hees	served	as	Chief	Executive	Officer	of	Burger	King	Worldwide	Holdings,	Inc.,	a	global	fast	food	restaurant	chain,	from	September	2010	to	June	2013 and	Burger	King	Worldwide,	Inc.	from	June	2012	to	June	2013	and	as	Chief	Executive	Officer	of	América	Latina	Logística	("ALL"),	a	logistics	company,	from	January 2005	to	September	2010.	Mr.	Hees	has	also	been	a	partner	at	3G	Capital,	a	global	investment	firm,	since	July	2010.	On	April	22,	2019,	we	announced	that	Bernardo Hees	will	leave	Kraft	Heinz	in	2019	to	focus	on	other	projects	as	a	Partner	of	3G	Capital.

Miguel	Patricio	was	appointed	to	succeed	Mr.	Hees	as	Chief	Executive	Officer	and	has	served	as	Advisor	to	Kraft	Heinz	since	May	5,	2019.	Mr.	Patricio	has	been	Chief of	Special	Global	Projects-Marketing	at	Anheuser-Busch	Inbev	SA/NV	("AB	InBev"),	a	multinational	drink	and	brewing	holdings	company,	since	January	1,	2019.	Prior to	that,	he	served	as	the	Chief	Marketing	Officer	at	AB	InBev	since	2012.	Prior	to	his	role	as	Chief	Marketing	Officer,	since	joining	AB	InBev	in	1998,	he	also	served	as Zone	President	Asia	Pacific,	Zone	President	North	America,	Vice	President	Marketing	of	North	America,	and	Vice	President	Marketing.	Mr.	Patricio	has	also	held several	senior	positions	across	the	Americas	at	The	Coca-Cola	Company	and	Johnson	&	Johnson.	Mr.	Patricio	also	invests	in	the	3G	Special	Situation	Fund	III	(the "Fund");	his	investment	represents	less	than	1%	of	the	Fund's	assets.

David	Knopf	became	Executive	Vice	President	and	Chief	Financial	Officer	in	October	2017.	He	had	previously	served	as	Vice	President,	Category	Head	of	Planters Business	since	August	2016.	Prior	to	that	role,	Mr.	Knopf	served	as	Vice	President	of	Finance,	Head	of	Global	Budget	&	Business	Planning,	Zero-Based	Budgeting,	and Financial	&	Strategic	Planning	from	July	2015	to	August	2016.	Prior	to	joining	Kraft	Heinz	in	July	2015,	Mr.	Knopf	served	in	various	roles	at	3G	Capital,	including	as an	associate	partner.	Before	joining	3G	Capital	in	October	2013,	Mr.	Knopf	served	in	various	roles	at	Onex	Partners,	a	private	equity	firm,	and	Goldman	Sachs,	a	global investment	banking,	securities,	and	investment	management	firm.	Mr.	Knopf	has	also	been	a	partner	of	3G	Capital	since	July	2015.

Nina	Barton	became	Zone	President	of	Canada	and	President	of	Digital	Growth	effective	January	1,	2019.	Prior	to	assuming	her	current	role,	Ms.	Barton	had	served	as President,	Global	Digital	and	Online	Growth	since	October	2017,	and	from	July	2015	 through	October	2017,	she	served	as	Senior	Vice	President	of	Marketing, Innovation	and	Research	&	Development	for	the	U.S.	business.	From	July	2013	through	July	2015,	she	served	as	Vice	President,	Marketing	at	Kraft	Foods	Group,	Inc. and	managed	the	total	coffee	portfolio	including	the	Maxwell	House,	Gevalia,	and	McCafe	brands.	Ms.	Barton	joined	Kraft	Foods	in	2011	as	Senior	Marketing	Director responsible	for	growing	 the	Philadelphia	cream	cheese	brand.	Prior	to	that,	Ms.	Barton	served	in	a	variety	of	marketing	and	brand-building	roles	in	the	consumer products	industry.

Paulo	Basilio	assumed	his	current	role	as	President	of	the	U.S.	Commercial	Business	in	October	2017.	Mr.	Basilio	previously	served	as	Executive	Vice	President	and Chief	Financial	Officer	upon	the	closing	of	the	2015	Merger	until	October	2017.	He	had	previously	served	as	Chief	Financial	Officer	of	Heinz	since	June	2013. Previously,	Mr.	Basilio	served	as	Chief	Executive	Officer	of	ALL	from	September	2010	to	June	2012,	after	having	served	in	various	roles	at	ALL,	including	Chief Operating	Officer,	Chief	Financial	Officer,	and	Analyst.	Mr.	Basilio	has	also	been	a	partner	of	3G	Capital	since	July	2012.

Pedro	Drevon	assumed	his	current	role	as	Zone	President	of	Latin	America	in	October	2017.	Previously	he	served	as	Managing	Director	for	Kraft	Heinz	Brazil	since August	2015.	Prior	to	joining	Kraft	Heinz	in	2015,	Mr.	Drevon	served	in	various	capacities	at	3G	Capital.	Before	joining	3G	Capital	in	2008,	Mr.	Drevon	served	in various	roles	at	Banco	BBM,	a	financial	advisory	and	wealth	management	firm.	Mr.	Drevon	has	also	been	a	partner	of	3G	Capital	since	January	2011.

Rashida	La	Lande	joined	Kraft	Heinz	as	Senior	Vice	President,	Global	General	Counsel	and	Corporate	Secretary	in	January	2018.	In	October	2018,	Ms.	La	Lande's responsibilities	expanded	to	include	leadership	of	our	corporate	social	responsibility	and	government	affairs	functions,	and	she	was	later	appointed	Head	of	Corporate Social	Responsibility	and	Government	Affairs	in	addition	to	her	role	as	Senior	Vice	President,	Global	General	Counsel	and	Corporate	Secretary.	Prior	to	joining	Kraft Heinz,	Ms.	La	Lande	was	a	partner	at	the	law	firm	of	Gibson,	Dunn	&	Crutcher,	where	she	advised	clients	with	respect	to	mergers	and	acquisitions,	leveraged	buyouts, private	equity	deals,	and	joint	ventures.	Throughout	Ms.	La	Lande's	career,	she	has	advised	companies	and	private	equity	sponsors	in	the	consumer	products,	retail, financial	services,	and	technology	industries.

Rafael	Oliveira	assumed	his	current	role	as	Zone	President	of	EMEA	in	October	2016	after	serving	as	the	Managing	Director	of	Kraft	Heinz	UK	&	Ireland.	Mr.	Oliveira joined	Kraft	Heinz	in	July	2014	and	served	as	President	of	Kraft	Heinz	Australia,	New	Zealand,	and	Papua	New	Guinea	until	September	2016.	Prior	to	joining	Kraft Heinz,	Mr.	Oliveira	spent	17	years	in	the	financial	industry,	the	final	10	of	which	he	held	a	variety	of	leadership	positions	with	Goldman	Sachs.

Rodrigo	Wickbold	assumed	his	current	role	as	Zone	President	of	APAC	in	January	2018	after	serving	as	Chief	Marketing	Officer	of	APAC	since	January	2016.	Prior	to joining	Kraft	Heinz	in	January	2016,	Mr.	Wickbold	served	in	various	marketing	and	business	leadership	roles	at	Unilever,	a	consumer	products	company,	since	2000, including	as	Global	Senior	Brand	Manager	-	Skin	Care.

# Available	Information

Our	website	address	is	www.kraftheinzcompany.com.	The	information	on	our	website	is	not,	and	shall	not	be	deemed	to	be,	a	part	of	this	Annual	Report	on	Form	10-K or	incorporated	into	any	other	filings	we	make	with	the	Securities	and	Exchange	Commission	(the	"SEC").	Our	Annual	Reports	on	Form	10-K,	Quarterly	Reports	on Form	10-Q,	Current	Reports	on	Form	8-K	and	amendments	to	those	reports	filed	or	furnished	pursuant	to	Section	13(a)	or	15(d)	of	the	Securities	Exchange	Act	of	1934, as	amended,	(the	"Exchange	Act")	are	available	free	of	charge	on	our	website	as	soon	as	reasonably	practicable	after	we	electronically	file	them	with,	or	furnish	them	to, the	SEC.	In	addition,	the	SEC	maintains	a	website	at	www.sec.gov	that	contains	reports,	proxy	and	information	statements,	and	other	information	regarding	issuers, including	Kraft	Heinz,	that	are	electronically	filed	with	the	SEC.

# Item	1A.	Risk	Factors.

# Industry	Risks

# We	operate	in	a	highly	competitive	industry.

The	food	and	beverage	industry	is	highly	competitive	across	all	of	our	product	offerings.	Our	principal	competitors	in	these	categories	are	manufacturers,	as	well	as retailers	with	their	own	branded	and	private	label	products.	We	compete	based	on	product	innovation,	price,	product	quality,	nutritional	value,	service,	taste,	convenience, brand	recognition	and	loyalty,	effectiveness	of	marketing	and	distribution,	promotional	activity,	and	the	ability	to	identify	and	satisfy	changing	consumer	preferences.

We	may	need	to	reduce	our	prices	in	response	to	competitive	and	customer	pressures,	including	pressures	in	relation	to	private	label	products	that	are	generally	sold	at lower	prices.	These	pressures	have	restricted	and	may	in	the	future	continue	to	restrict	our	ability	to	increase	prices	in	response	to	commodity	and	other	cost	increases. Failure	to	effectively	assess,	timely	change	and	set	proper	pricing,	promotions,	or	trade	incentives	may	negatively	impact	the	achievement	of	our	objectives.

The	rapid	emergence	of	new	distribution	channels,	particularly	e-commerce,	may	create	consumer	price	deflation,	affecting	our	retail	customer	relationships	and presenting	additional	challenges	to	increasing	prices	in	response	to	commodity	or	other	cost	increases.	We	may	also	need	to	increase	or	reallocate	spending	on	marketing, retail	trade	incentives,	materials,	advertising,	and	new	product	or	channel	innovation	to	maintain	or	increase	market	share.	These	expenditures	are	subject	to	risks, including	uncertainties	about	trade	and	consumer	acceptance	of	our	efforts.	If	we	are	unable	to	compete	effectively,	our	profitability,	financial	condition,	and	operating results	may	decline.

# Our	success	depends	on	our	ability	to	correctly	predict,	identify,	and	interpret	changes	in	consumer	preferences	and	demand,	to	offer	new	products	to	meet	those changes,	and	to	respond	to	competitive	innovation.

Consumer	preferences	for	food	and	beverage	products	change	continually	and	rapidly.	Our	success	depends	on	our	ability	to	predict,	identify,	and	interpret	the	tastes	and dietary	habits	of	consumers	and	to	offer	products	that	appeal	to	consumer	preferences,	including	with	respect	to	health	and	wellness.	If	we	do	not	offer	products	that appeal	to	consumers,	our	sales	and	market	share	will	decrease,	which	could	materially	and	adversely	affect	our	product	sales,	financial	condition,	and	operating	results.

We	must	distinguish	between	short-term	trends	and	long-term	changes	in	consumer	preferences.	If	we	do	not	accurately	predict	which	shifts	in	consumer	preferences	will be	long-term,	or	if	we	fail	to	introduce	new	and	improved	products	to	satisfy	those	preferences,	our	sales	could	decline.	In	addition,	because	of	our	varied	consumer	base, we	must	offer	an	array	of	products	that	satisfy	a	broad	spectrum	of	consumer	preferences.	If	we	fail	to	expand	our	product	offerings	successfully	across	product categories,	or	if	we	do	not	rapidly	develop	products	in	faster-growing	or	more	profitable	categories,	demand	for	our	products	could	decrease,	which	could	materially	and adversely	affect	our	product	sales,	financial	condition,	and	operating	results.

Prolonged	negative	perceptions	concerning	the	health	implications	of	certain	food	and	beverage	products	(including	as	they	relate	to	obesity	or	other	health	concerns) could	influence	consumer	preferences	and	acceptance	of	some	of	our	products	and	marketing	programs.	We	strive	to	respond	to	consumer	preferences	and	social expectations,	but	we	may	not	be	successful	in	our	efforts.	Continued	negative	perceptions	and	failure	to	satisfy	consumer	preferences	could	materially	and	adversely affect	our	product	sales,	financial	condition,	and	operating	results.

In	addition,	achieving	growth	depends	on	our	successful	development,	introduction,	and	marketing	of	innovative	new	products	and	line	extensions.	There	are	inherent risks	associated	with	new	product	or	packaging	introductions,	including	uncertainties	about	trade	and	consumer	acceptance	or	potential	impacts	on	our	existing	product offerings.	We	may	be	required	to	increase	expenditures	for	new	product	development.	Successful	innovation	depends	on	our	ability	to	correctly	anticipate	customer	and consumer	acceptance,	to	obtain,	protect,	and	maintain	necessary	intellectual	property	rights,	and	to	avoid	infringing	upon	the	intellectual	property	rights	of	others.	We must	also	be	able	to	respond	successfully	to	technological	advances	by	and	intellectual	property	rights	of	our	competitors,	and	failure	to	do	so	could	compromise	our competitive	position	and	impact	our	product	sales,	financial	condition,	and	operating	results.

# Changes	in	the	retail	landscape	or	the	loss	of	key	retail	customers	could	adversely	affect	our	financial	performance.

Retail	customers,	such	as	supermarkets,	warehouse	clubs,	and	food	distributors	 in	our	major	markets,	may	continue	 to	consolidate,	resulting	 in	fewer	but	 larger customers	for	our	business	across	various	channels.	Consolidation	also	produces	larger	retail	customers	that	may	seek	to	leverage	their	positions	to	improve	their profitability	by	demanding	improved	efficiency,	lower	pricing,	more	favorable	terms,	increased	promotional	programs,	or	specifically-tailored	product	offerings.	In addition,	larger	retailers	have	scale	to	develop	supply	chains	that	permit	them	to	operate	with	reduced	inventories	or	to	develop	and	market	their	own	private	label products.	Retail	consolidation	and	increasing	retailer	power	could	materially	and	adversely	affect	our	product	sales,	financial	condition,	and	operating	results.

Retail	consolidation	also	increases	the	risk	that	adverse	changes	in	our	customers'	business	operations	or	financial	performance	may	have	a	corresponding	material	and adverse	effect	on	us.	For	example,	if	our	customers	cannot	access	sufficient	funds	or	financing,	then	they	may	delay,	decrease,	or	cancel	purchases	of	our	products,	or delay	or	fail	to	pay	us	for	previous	purchases,	which	could	materially	and	adversely	affect	our	product	sales,	financial	condition,	and	operating	results.

In	addition,	technology-based	systems,	which	give	consumers	the	ability	to	shop	through	e-commerce	websites	and	mobile	commerce	applications,	are	also	significantly altering	the	retail	landscape	in	many	of	our	markets.	If	we	are	unable	to	adjust	to	developments	in	these	changing	landscapes,	we	may	be	disadvantaged	in	key	channels and	with	certain	consumers,	which	could	materially	and	adversely	affect	our	product	sales,	financial	condition,	and	operating	results.

# Changes	in	our	relationships	with	significant	customers,	suppliers,	or	other	business	relationships	could	adversely	impact	us.

We	derive	significant	portions	of	our	sales	from	certain	significant	customers	(see	Sales	and	Customers	within	Item	1,	Business).	There	can	be	no	assurance	that	all	of our	significant	customers	will	continue	to	purchase	our	products	in	the	same	mix	or	quantities	or	on	the	same	terms	as	in	the	past,	particularly	as	increasingly	powerful retailers	may	demand	lower	pricing	and	focus	on	developing	their	own	brands.	The	loss	of	a	significant	customer	or	a	material	reduction	in	sales	or	a	change	in	the	mix	of products	we	sell	to	a	significant	customer	could	materially	and	adversely	affect	our	product	sales,	financial	condition,	and	operating	results.

Disputes	with	significant	suppliers,	including	disputes	related	to	pricing	or	performance,	could	adversely	affect	our	ability	to	supply	products	to	our	customers	and	could materially	and	adversely	affect	our	product	sales,	financial	condition,	and	operating	results.	In	addition,	terminations	of	relationships	with	other	significant	contractual counterparties,	including	licensors,	could	adversely	affect	our	portfolio,	product	sales,	financial	condition,	and	operating	results.

In	addition,	the	financial	condition	of	such	customers,	suppliers,	and	other	significant	contractual	counterparties	are	affected	in	large	part	by	conditions	and	events	that	are beyond	our	control.	Significant	deteriorations	 in	 the	financial	conditions	of	significant	customers,	suppliers,	and	other	business	relationships	could	materially	and adversely	affect	our	product	sales,	financial	condition,	and	operating	results.

# Maintaining,	extending,	and	expanding	our	reputation	and	brand	image	are	essential	to	our	business	success.

We	have	many	iconic	brands	with	long-standing	consumer	recognition	across	the	globe.	Our	success	depends	on	our	ability	to	maintain	brand	image	for	our	existing products,	extend	our	brands	to	new	platforms,	and	expand	our	brand	image	with	new	product	offerings.

We	seek	to	maintain,	extend,	and	expand	our	brand	image	through	marketing	investments,	including	advertising	and	consumer	promotions,	and	product	innovation. Negative	perceptions	on	the	role	of	food	and	beverage	marketing	could	adversely	affect	our	brand	image	or	lead	to	stricter	regulations	and	scrutiny	of	marketing practices.	Moreover,	adverse	publicity	about	legal	or	regulatory	action	against	us,	our	quality	and	safety,	our	environmental	or	social	impacts,	our	products	becoming unavailable	to	consumers,	or	our	suppliers	and,	in	some	cases,	our	competitors,	could	damage	our	reputation	and	brand	image,	undermine	our	customers'	confidence, and	reduce	demand	for	our	products,	even	if	the	regulatory	or	legal	action	is	unfounded	or	not	material	to	our	operations.	Furthermore,	existing	or	increased	legal	or regulatory	restrictions	on	our	advertising,	consumer	promotions,	and	marketing,	or	our	response	to	those	restrictions,	could	limit	our	efforts	to	maintain,	extend,	and expand	our	brands.

In	addition,	our	success	in	maintaining,	extending,	and	expanding	our	brand	image	depends	on	our	ability	to	adapt	to	a	rapidly	changing	media	environment.	We increasingly	rely	on	social	media	and	online	dissemination	of	advertising	campaigns.	The	growing	use	of	social	and	digital	media	increases	the	speed	and	extent	that information,	including	misinformation,	and	opinions	can	be	shared.	Negative	posts	or	comments	about	us,	our	brands	or	our	products,	or	our	suppliers	and,	in	some cases,	our	competitors,	on	social	or	digital	media,	whether	or	not	valid,	could	seriously	damage	our	brands	and	reputation.	In	addition,	we	might	fail	to	appropriately target	our	marketing	efforts,	anticipate	consumer	preferences,	or	invest	sufficiently	in	maintaining,	extending,	and	expanding	our	brand	image.	If	we	do	not	maintain, extend,	and	expand	our	reputation	or	brand	image,	then	our	product	sales,	financial	condition,	and	operating	results	could	be	materially	and	adversely	affected.

# We	must	leverage	our	brand	value	to	compete	against	private	label	products.

In	nearly	all	of	our	product	categories,	we	compete	with	branded	products	as	well	as	private	label	products,	which	are	typically	sold	at	lower	prices.	Our	products	must provide	higher	value	and/or	quality	to	our	consumers	than	alternatives,	particularly	during	periods	of	economic	uncertainty.	Consumers	may	not	buy	our	products	if relative	differences	in	value	and/or	quality	between	our	products	and	private	label	products	change	in	favor	of	competitors'	products	or	if	consumers	perceive	this	type	of change.	If	consumers	prefer	private	label	products,	then	we	could	lose	market	share	or	sales	volumes	or	shift	our	product	mix	to	lower	margin	offerings.	A	change	in consumer	preferences	could	also	cause	us	to	increase	capital,	marketing,	and	other	expenditures,	which	could	materially	and	adversely	affect	our	product	sales,	financial condition,	and	operating	results.

# We	may	be	unable	to	drive	revenue	growth	in	our	key	product	categories,	increase	our	market	share,	or	add	products	that	are	in	faster-growing	and	more	profitable categories.

Our	future	results	will	depend	on	our	ability	to	drive	revenue	growth	in	our	key	product	categories	and	growth	in	the	food	and	beverage	industry	in	the	countries	in	which we	operate.	Our	future	results	will	also	depend	on	our	ability	to	enhance	our	portfolio	by	adding	innovative	new	products	in	faster-growing	and	more	profitable categories	and	our	ability	to	increase	market	share	in	our	existing	product	categories.	Our	failure	to	drive	revenue	growth,	limit	market	share	decreases	in	our	key	product categories,	or	develop	innovative	products	for	new	and	existing	categories	could	materially	and	adversely	affect	our	product	sales,	financial	condition,	and	operating results.

# Product	recalls	or	other	product	liability	claims	could	materially	and	adversely	affect	us.

Selling	products	for	human	consumption	involves	inherent	legal	and	other	risks,	including	product	contamination,	spoilage,	product	tampering,	allergens,	or	other adulteration.	We	have	decided	and	could	in	the	future	decide	to,	and	have	been	or	could	in	the	future	be	required	to,	recall	products	due	to	suspected	or	confirmed product	contamination,	adulteration,	product	mislabeling	or	misbranding,	tampering,	undeclared	allergens,	or	other	deficiencies.	Product	recalls	or	market	withdrawals could	result	in	significant	losses	due	to	their	costs,	the	destruction	of	product	inventory,	and	lost	sales	due	to	the	unavailability	of	the	product	for	a	period	of	time.

We	could	be	adversely	affected	if	consumers	lose	confidence	in	the	safety	and	quality	of	certain	food	products	or	ingredients,	or	the	food	safety	system	generally. Adverse	attention	about	these	types	of	concerns,	whether	or	not	valid,	may	damage	our	reputation,	discourage	consumers	from	buying	our	products,	or	cause	production and	delivery	disruptions	that	could	negatively	impact	our	net	sales	and	financial	condition.

We	may	also	suffer	losses	if	our	products	or	operations	violate	applicable	laws	or	regulations,	or	if	our	products	cause	injury,	illness,	or	death.	In	addition,	our	marketing could	face	claims	of	false	or	deceptive	advertising	or	other	criticism.	A	significant	product	liability	or	other	legal	judgment	or	a	related	regulatory	enforcement	action against	us,	or	a	significant	product	recall,	may	materially	and	adversely	affect	our	reputation	and	profitability.	Moreover,	even	if	a	product	liability	or	fraud	claim	is unsuccessful,	has	no	merit,	or	is	not	pursued,	the	negative	publicity	surrounding	assertions	against	our	products	or	processes	could	materially	and	adversely	affect	our product	sales,	financial	condition,	and	operating	results.

# Unanticipated	business	disruptions	could	adversely	affect	our	ability	to	provide	our	products	to	our	customers.

We	have	a	complex	network	of	suppliers,	owned	and	leased	manufacturing	locations,	co-manufacturing	locations,	distribution	networks,	and	information	systems	that support	our	ability	to	consistently	provide	our	products	to	our	customers.	Factors	that	are	hard	to	predict	or	beyond	our	control,	such	as	weather,	raw	material	shortages, natural	disasters,	fires	or	explosions,	political	unrest,	terrorism,	generalized	labor	unrest,	or	health	pandemics,	could	damage	or	disrupt	our	operations	or	our	suppliers', co-manufacturers'	or	distributors'	operations.	These	disruptions	may	require	additional	resources	to	restore	our	supply	chain	or	distribution	network.	If	we	cannot respond	to	disruptions	in	our	operations,	whether	by	finding	alternative	suppliers	or	replacing	capacity	at	key	manufacturing	or	distribution	locations,	or	if	we	are	unable to	quickly	repair	damage	to	our	information,	production,	or	supply	systems,	we	may	be	late	in	delivering,	or	be	unable	to	deliver,	products	to	our	customers	and	may	also be	unable	to	track	orders,	inventory,	receivables,	and	payables.	If	that	occurs,	our	customers'	confidence	in	us	and	long-term	demand	for	our	products	could	decline.	Any of	these	events	could	materially	and	adversely	affect	our	product	sales,	financial	condition,	and	operating	results.

# Business	Risks

# We	may	not	successfully	identify,	complete,	or	realize	the	benefits	from	strategic	acquisitions,	alliances,	divestitures,	joint	ventures,	or	other	investments.

From	time	to	time,	we	have	evaluated	and	may	continue	to	evaluate	acquisition	candidates,	alliances,	joint	ventures,	or	other	investments	that	may	strategically	fit	our business	objectives,	and	we	have	divested	and	may	consider	divesting	businesses	that	do	not	meet	our	strategic	objectives	or	growth	or	profitability	targets.	These activities	may	present	financial,	managerial,	and	operational	risks	including,	but	not	limited	to,	diversion	of	management's	attention	from	existing	core	businesses, difficulties	integrating	or	separating	personnel	and	financial	and	other	systems,	inability	to	effectively	and	immediately	implement	control	environment	processes	across a	diverse	employee	population,	adverse	effects	on	existing	or	acquired	customer	and	supplier	business	relationships,	and	potential	disputes	with	buyers,	sellers,	or partners.	Activities	in	such	areas	are	regulated	by	numerous	antitrust	and	competition	laws	in	the	United	States,	Canada,	the	European	Union,	and	other	jurisdictions,	and we	may	be	required	to	obtain	the	approval	of	these	transactions	by	competition	authorities,	as	well	as	to	satisfy	other	legal	requirements.

To	the	extent	we	undertake	acquisitions,	alliances,	joint	ventures,	investments,	or	other	developments	outside	our	core	regions	or	in	new	categories,	we	may	face additional	risks	related	to	such	developments.	For	example,	risks	related	to	foreign	operations	include	compliance	with	U.S.	laws	affecting	operations	outside	of	the United	 States,	 such	 as	 the	 FCPA,	 currency	 rate	 fluctuations,	 compliance	 with	 foreign	 regulations	 and	 laws,	 including	 tax	 laws,	 and	 exposure	 to	 politically	 and economically	volatile	developing	markets.	Any	of	these	factors	could	materially	and	adversely	affect	our	product	sales,	financial	condition,	and	operating	results.

# We	may	be	unable	to	realize	the	anticipated	benefits	from	prior	or	future	streamlining	actions	to	reduce	fixed	costs,	simplify	or	improve	processes,	and	improve	our competitiveness.

We	have	implemented	a	number	of	cost	savings	initiatives,	including	our	Integration	Program	(as	defined	in	Overview,	in	Item	7,	Management's	Discussion	and	Analysis of	Financial	Condition	and	Results	of	Operations),	that	we	believe	are	important	to	position	our	business	for	future	success	and	growth.	We	have	evaluated	and	continue to	evaluate	changes	to	our	organizational	structure	to	enable	us	to	reduce	costs,	simplify	or	improve	processes,	and	improve	our	competitiveness.	Our	future	success	may depend	upon	our	ability	to	realize	the	benefits	of	these	or	other	cost	savings	initiatives.	In	addition,	certain	of	our	initiatives	may	lead	to	increased	costs	in	other	aspects of	our	business	such	as	increased	conversion,	outsourcing,	or	distribution	costs.	We	must	accurately	predict	costs	and	be	efficient	in	executing	any	plans	to	achieve	cost savings	and	operate	efficiently	in	the	highly	competitive	food	and	beverage	industry,	particularly	in	an	environment	of	increased	competitive	activity.	To	capitalize	on our	efforts,	we	must	carefully	evaluate	investments	in	our	business,	and	execute	in	those	areas	with	the	most	potential	return	on	investment.	If	we	are	unable	to	realize	the anticipated	benefits	from	any	cost-saving	efforts,	we	could	be	cost	disadvantaged	 in	 the	marketplace,	and	our	competitiveness,	production,	profitability,	financial conditions,	and	operating	results	could	be	adversely	affected.

# We	may	not	be	able	to	successfully	execute	our	strategic	initiatives.

We	plan	to	continue	to	conduct	strategic	initiatives	in	various	markets.	Consumer	demands,	behaviors,	tastes	and	purchasing	trends	may	differ	in	these	markets	and,	as	a result,	our	sales	may	not	be	successful	or	meet	expectations,	or	the	margins	on	those	sales	may	be	less	than	currently	anticipated.	We	may	also	face	difficulties integrating	new	business	operations	with	our	current	sourcing,	distribution,	information	technology	systems,	and	other	operations.	Any	of	these	challenges	could	hinder our	success	in	new	markets	or	new	distribution	channels.	We	may	also	face	difficulties	divesting	business	operations	with	minimal	impact	to	the	retained	businesses. There	can	be	no	assurance	that	we	will	successfully	complete	any	planned	strategic	initiatives,	that	any	new	business	will	be	profitable	or	meet	our	expectations,	or	that any	divestiture	will	be	completed	without	disruption,	which	could	adversely	affect	our	results	of	operations	and	financial	condition.

# Our	international	operations	subject	us	to	additional	risks	and	costs	and	may	cause	our	profitability	to	decline.

We	are	a	global	company	with	sales	and	operations	in	numerous	countries	within	developed	and	emerging	markets.	Approximately	31%	of	our	2018	net	sales	were generated	outside	of	the	United	States.	As	a	result,	we	are	subject	to	risks	inherent	in	global	operations.	These	risks,	which	can	vary	substantially	by	market,	are described	in	many	of	the	risk	factors	discussed	in	this	section	and	also	include:

•compliance	with	U.S.	laws	affecting	operations	outside	of	the	United	States,	including	anti-bribery	laws	such	as	the

FCPA;

•changes	in	the	mix	of	earnings	in	countries	with	differing	statutory	tax	rates,	changes	in	the	valuation	of	deferred	tax	assets	and	liabilities,	changes	in	tax	laws	or their	interpretations,	or	tax	audit	implications;

•the	imposition	of	increased	or	new	tariffs,	quotas,	trade	barriers,	or	similar	restrictions	on	our	sales	or	imports,	trade	agreements,	regulations,	taxes,	or	policies that	might	negatively	affect	our	sales	or	costs;

•currency devaluations or fluctuations in currency values;

•compliance	with	antitrust	and	competition	laws,	data	privacy	laws,	and	a	variety	of	other	local,	national,	and	multi-national	regulations	and	laws	in	multiple jurisdictions;

•discriminatory or conflicting fiscal policies in or across foreign jurisdictions;

•changes	in	capital	controls,	including	currency	exchange	controls,	government	currency	policies,	or	other	limits	on	our	ability	to	import	raw	materials	or finished	product	into	various	countries	or	repatriate	cash	from	outside	the	United	States;

•challenges associated with cross-border product distribution;

•changes	in	local	regulations	and	laws,	the	uncertainty	of	enforcement	of	remedies	in	foreign	jurisdictions,	and	foreign	ownership	restrictions	and	the	potential for	nationalization	or	expropriation	of	property	or	other	resources;

•risks	and	costs	associated	with	political	and	economic	instability,	corruption,	anti-American	sentiment,	and	social	and	ethnic	unrest	in	the	countries	in	which	we operate;

•the	risks	of	operating	in	developing	or	emerging	markets	in	which	there	are	significant	uncertainties	regarding	the	interpretation,	application,	and	enforceability of	laws	and	regulations	and	the	enforceability	of	contract	rights	and	intellectual	property	rights;

•risks	arising	from	the	significant	and	rapid	fluctuations	in	currency	exchange	markets	and	the	decisions	made	and	positions	taken	to	hedge	such volatility;

•changing labor conditions and difficulties in staffing our operations;

•greater	risk	of	uncollectible	accounts	and longer	collection	cycles; and

•design,	implementation,	and	use	of	effective	control	environment	processes	across	our	diverse	operations	and	employee base.

In	addition,	political	and	economic	changes	or	volatility,	geopolitical	conflicts,	terrorist	activity,	political	unrest,	civil	strife,	acts	of	war,	public	corruption,	expropriation, and	 other	 economic	 or	 political	 uncertainties	 could	 interrupt	 and	 negatively	 affect	 our	 business	 operations	 or	 customer	 demand.	 Slow	 economic	 growth	 or	 high unemployment	 in	 the	 markets	 in	 which	 we	 operate	 could	 constrain	 consumer	 spending,	 and	 declining	 consumer	 purchasing	 power	 could	 adversely	 impact	 our profitability.	All	of	these	factors	could	result	in	increased	costs	or	decreased	sales,	and	could	materially	and	adversely	affect	our	product	sales,	financial	condition,	and results	of	operations.

# Our	performance	may	be	adversely	affected	by	economic	and	political	conditions	in	the	United	States	and	in	various	other	nations	where	we	do	business.

Our	performance	has	been	in	the	past	and	may	continue	in	the	future	to	be	impacted	by	economic	and	political	conditions	in	the	United	States	and	in	other	nations	where we	do	business.	Economic	and	financial	uncertainties	in	our	international	markets,	including	uncertainties	surrounding	the	legal	and	regulatory	effects	of	Brexit,	changes to	major	international	trade	arrangements	(e.g.,	the	United	States-Mexico-Canada	Agreement),	and	the	imposition	of	tariffs	by	certain	foreign	governments,	including China	and	Canada,	in	response	to	the	imposition	of	tariffs	or	modification	of	trade	relationships	by	the	United	States,	could	negatively	impact	our	operations	and	sales. Other	factors	impacting	our	operations	in	the	United	States	and	in	international	locations	where	we	do	business	include	export	and	import	restrictions,	currency	exchange rates,	 currency	 devaluation,	 cash	 repatriation	 restrictions,	 recessionary	 conditions,	 foreign	 ownership	 restrictions,	 nationalization,	 the	 impact	 of	 hyperinflationary environments,	terrorist	acts,	and	political	unrest.	Such	factors	in	either	domestic	or	foreign	jurisdictions,	and	our	responses	to	them,	could	materially	and	adversely	affect our	product	sales,	financial	condition,	and	operating	results.	For	further	information	on	Venezuela,	see	Note	16,	Venezuela	-	Foreign	Currency	and	Inflation,	in	Item	8, Financial	Statements	and	Supplementary	Data.

# We	rely	on	our	management	team	and	other	key	personnel	and	may	be	unable	to	hire	or	retain	key	personnel	or	a	highly	skilled	and	diverse	global	workforce.

We	depend	on	the	skills,	working	relationships,	and	continued	services	of	key	personnel,	including	our	experienced	management	team.	In	addition,	our	ability	to	achieve our	operating	goals	depends	on	our	ability	to	identify,	hire,	train,	and	retain	qualified	individuals.	We	compete	with	other	companies	both	within	and	outside	of	our industry	for	talented	personnel,	and	we	may	lose	key	personnel	or	fail	to	attract,	train,	and	retain	other	talented	personnel	and	a	diverse	global	workforce	with	the	skills and	in	the	locations	we	need	to	operate	and	grow	our	business.	Unplanned	turnover,	failure	to	attract	and	develop	personnel	with	key	emerging	capabilities	such	as	e- commerce	and	digital	marketing	skills,	or	failure	to	develop	adequate	succession	plans	for	leadership	positions,	including	the	Chief	Executive	Officer	position,	could deplete	our	institutional	knowledge	base	and	erode	our	competitiveness.	Changes	in	immigration	laws	and	policies	could	also	make	it	more	difficult	for	us	to	recruit	or relocate	skilled	employees.	Any	such	loss,	failure,	or	limitation	could	adversely	affect	our	product	sales,	financial	condition,	and	operating	results.

# We	are	significantly	dependent	on	information	technology,	and	we	may	be	unable	to	protect	our	information	systems	against	service	interruption,	misappropriation of	data,	or	breaches	of	security.

We	rely	on	information	technology	networks	and	systems,	including	the	Internet,	to	process,	transmit,	and	store	electronic	and	financial	information,	to	manage	a	variety of	business	processes	and	activities,	and	to	comply	with	regulatory,	legal,	and	tax	requirements.	We	also	depend	on	our	information	technology	infrastructure	for	digital marketing	activities	and	for	electronic	communications	among	our	locations,	personnel,	customers,	and	suppliers.	These	information	technology	systems,	some	of	which are	managed	by	third	parties,	may	be	susceptible	to	damage,	invasions,	disruptions,	or	shutdowns	due	to	hardware	failures,	computer	viruses,	hacker	attacks	and	other cybersecurity	risks,	telecommunication	failures,	user	errors,	catastrophic	events	or	other	factors.	If	our	information	technology	systems	suffer	severe	damage,	disruption, or	shutdown,	by	unintentional	or	malicious	actions	of	employees	and	contractors	or	by	cyber-attacks,	and	our	business	continuity	plans	do	not	effectively	resolve	the issues	in	a	timely	manner,	we	could	experience	business	disruptions,	reputational	damage,	transaction	errors,	processing	inefficiencies,	the	leakage	of	confidential information,	and	the	loss	of	customers	and	sales,	causing	our	product	sales,	financial	condition,	and	operating	results	to	be	adversely	affected	and	the	reporting	of	our financial	results	to	be	delayed.

In	addition,	if	we	are	unable	to	prevent	security	breaches	or	disclosure	of	non-public	information,	we	may	suffer	financial	and	reputational	damage,	litigation	or remediation	costs,	fines,	or	penalties	because	of	the	unauthorized	disclosure	of	confidential	information	belonging	to	us	or	to	our	partners,	customers,	consumers,	or suppliers.

Misuse,	 leakage,	or	falsification	of	 information	could	result	 in	violations	of	data	privacy	 laws	and	regulations,	damage	 to	our	reputation	and	credibility,	 loss	of opportunities	to	acquire	or	divest	of	businesses	or	brands,	and	loss	of	ability	to	commercialize	products	developed	through	research	and	development	efforts	and, therefore,	could	have	a	negative	impact	on	net	sales.	In	addition,	we	may	suffer	financial	and	reputational	damage	because	of	lost	or	misappropriated	confidential information	belonging	to	us,	our	current	or	former	employees,	or	to	our	suppliers	or	consumers,	and	may	become	subject	to	legal	action	and	increased	regulatory oversight.	We	could	also	be	required	to	spend	significant	financial	and	other	resources	to	remedy	the	damage	caused	by	a	security	breach	or	to	repair	or	replace	networks and	information	systems.

# Our	results	of	operations	could	be	affected	by	natural	events	in	the	locations	in	which	we	or	our	customers,	suppliers,	distributors,	or	regulators	operate.

We	have	been	and	may	in	the	future	be	impacted	by	severe	weather	and	other	geological	events,	including	hurricanes,	earthquakes,	floods,	or	tsunamis	that	could	disrupt our	operations	or	the	operations	of	our	customers,	suppliers,	distributors,	or	regulators.	Natural	disasters	or	other	disruptions	at	any	of	our	facilities	or	our	suppliers'	or distributors'	facilities	may	impair	or	delay	the	delivery	of	our	products.	Influenza	or	other	pandemics	could	disrupt	production	of	our	products,	reduce	demand	for	certain of	our	products,	or	disrupt	the	marketplace	in	the	foodservice	or	retail	environment	with	consequent	material	adverse	effects	on	our	results	of	operations.	While	we	insure against	many	of	these	events	and	certain	business	interruption	risks	and	have	policies	and	procedures	to	manage	business	continuity	planning,	we	cannot	provide	any assurance	that	such	insurance	will	compensate	us	for	any	losses	incurred	as	a	result	of	natural	or	other	disasters	or	that	our	business	continuity	plans	will	effectively resolve	the	issues	in	a	timely	manner.	To	the	extent	we	are	unable	to,	or	cannot,	financially	mitigate	the	likelihood	or	potential	impact	of	such	events,	or	effectively manage	such	events	if	they	occur,	particularly	when	a	product	is	sourced	from	a	single	location,	there	could	be	a	material	adverse	effect	on	our	business	and	results	of operations,	and	additional	resources	could	be	required	to	restore	our	supply	chain.

# The	Sponsors	have	substantial	control	over	us	and	may	have	conflicts	of	interest	with	us	in	the	future.

As	of	December	29,	2018,	the	Sponsors	own	approximately	49%	of	our	common	stock.	Four	of	our	current	11	directors	had	been	directors	of	Heinz	prior	to	the	closing of	the	2015	Merger	and	remained	directors	of	Kraft	Heinz	pursuant	to	the	merger	agreement.	In	addition,	the	Board	elected	Joao	M.	Castro-Neves,	a	partner	of	3G Capital,	one	of	the	Sponsors,	effective	June	12,	2019.	Furthermore,	some	of	our	executive	officers,	including	Bernardo	Hees,	our	Chief	Executive	Officer,	are	partners	of 3G	Capital.	As	a	result,	the	Sponsors	have	the	potential	to	exercise	influence	over	management	and	have	substantial	control	over	decisions	of	our	Board	of	Directors	as well	as	over	any	action	requiring	the	approval	of	the	holders	of	our	common	stock,	including	adopting	any	amendments	to	our	charter,	electing	directors,	and	approving mergers	or	sales	of	substantially	all	of	our	capital	stock	or	our	assets.	In	addition,	to	the	extent	that	the	Sponsors	were	to	collectively	hold	a	majority	of	our	common stock,	they	together	would	have	the	power	to	take	shareholder	action	by	written	consent	to	adopt	amendments	to	our	charter	or	take	other	actions,	such	as	corporate transactions,	that	require	the	vote	of	holders	of	a	majority	of	our	outstanding	common	stock.	The	directors	designated	by	the	Sponsors	may	have	significant	authority	to effect	decisions	affecting	our	capital	structure,	including	the	issuance	of	additional	capital	stock,	the	incurrence	of	additional	indebtedness,	the	implementation	of	stock repurchase	programs,	and	the	decision	of	whether	to	declare	dividends	and	the	amount	of	any	such	dividends.	Additionally,	the	Sponsors	are	in	the	business	of	making investments	in	companies	and	may	from	time	to	time	acquire	and	hold	interests	in	businesses	that	compete	directly	or	indirectly	with	us.	The	Sponsors	may	also	pursue acquisition	opportunities	that	may	be	complementary	to	our	business,	and,	as	a	result,	those	acquisition	opportunities	may	not	be	available	to	us.	So	long	as	the	Sponsors continue	to	own	a	significant	amount	of	our	equity,	they	will	continue	to	be	able	to	strongly	influence	or	effectively	control	our	decisions.

# Financial	Risks

# Our	level	of	indebtedness,	as	well	as	our	failure	to	comply	with	covenants	under	our	debt	instruments,	could	adversely	affect	our	business	and	financial	condition.

We	have	a	substantial	amount	of	indebtedness,	and	are	permitted	to	incur	a	substantial	amount	of	additional	indebtedness,	including	secured	debt.	Our	existing	debt, together	with	any	incurrence	of	additional	indebtedness,	could	have	important	consequences,	including,	but	not	limited	to:

•increasing our vulnerability to general adverse economic and industry conditions;

•limiting	our	ability	to	obtain	additional	financing	for	working	capital,	capital	expenditures,	research	and	development,	debt	service	requirements,	acquisitions, and	general	corporate	or	other	purposes;

•resulting	in	a	downgrade	to	our	credit	rating,	which	could	adversely	affect	our	cost	of	funds,	including	our	commercial	paper	programs;	liquidity;	and	access	to capital	markets;

•restricting	us	from	making	strategic	acquisitions	or	causing	us	to	make	non-strategic

divestitures;

•limiting	our	ability	to	adjust	to	changing	market	conditions	and	place	us	at	a	competitive	disadvantage	compared	to	our	competitors	who	are	not	as	highly leveraged;

•making	it	more	difficult	for	us	to	make	payments	on	our	existing

indebtedness;

•requiring	a	substantial	portion	of	cash	flows	from	operations	to	be	dedicated	to	the	payment	of	principal	and	interest	on	our	indebtedness,	thereby	reducing	our ability	to	use	our	cash	flow	to	fund	our	operations,	payments	of	dividends,	capital	expenditures,	and	future	business	opportunities;

•exposing	us	to	risks	related	to	fluctuations	in	foreign	currency,	as	we	earn	profits	in	a	variety	of	currencies	around	the	world	and	substantially	all	of	our	debt	is denominated	in	U.S.	dollars;	and

•in	the	case	of	any	additional	indebtedness,	exacerbating	the	risks	associated	with	our	substantial	financial

leverage.

In	addition,	there	can	be	no	assurance	that	we	will	generate	sufficient	cash	flow	from	operations	or	that	future	debt	or	equity	financings	will	be	available	to	us	to	enable us	to	pay	our	indebtedness	or	to	fund	other	needs.	As	a	result,	we	may	need	to	refinance	all	or	a	portion	of	our	indebtedness	on	or	before	maturity.	There	is	no	assurance that	we	will	be	able	to	refinance	any	of	our	indebtedness	on	favorable	terms,	or	at	all.	Any	inability	to	generate	sufficient	cash	flow	or	to	refinance	our	indebtedness	on favorable	terms	could	have	a	material	adverse	effect	on	our	financial	condition.

Our	indebtedness	instruments	contain	customary	representations,	warranties	and	covenants,	including	a	financial	covenant	in	our	senior	unsecured	revolving	credit facility	(the	"Senior	Credit	Facility")	to	maintain	a	minimum	shareholders'	equity	(excluding	accumulated	other	comprehensive	income/(losses)).	The	creditors	who	hold our	debt	could	accelerate	amounts	due	in	the	event	that	we	default,	which	could	potentially	trigger	a	default	or	acceleration	of	the	maturity	of	our	other	debt.	If	our operating	performance	declines,	or	if	we	are	unable	to	comply	with	any	covenant,	such	as	our	ability	to	timely	prepare	and	file	our	periodic	reports	with	the	SEC,	we	have needed	and	may	in	the	future	need	to	obtain	waivers	from	the	required	creditors	under	our	indebtedness	instruments	to	avoid	being	in	default.

During	the	period	from	December	29,	2018	to	the	filing	date	of	this	Annual	Report	on	Form	10-K,	due	to	the	delays	in	the	preparation	of	our	financial	statements	for	the fiscal	year	ended	December	29,	2018	and	the	fiscal	quarter	ended	March	30,	2019,	we	were	not	in	compliance	with	certain	reporting	covenants	under	the	Senior	Credit Facility.	As	previously	disclosed,	we	entered	into	two	waiver	agreements	with	respect	to	the	Senior	Credit	Facility,	pursuant	to	which	the	lenders,	as	party	to	the	Senior Credit	Facility,	and	JPMorgan	Chase	Bank,	N.A.,	as	administrative	agent,	granted	temporary	waivers	of	compliance	by	us	with	respect	to	the	requirement	to	furnish	the lenders	a	copy	of	the	consolidated	financial	statements	for	our	fiscal	year	ended	December	29,	2018	no	later	than	June	28,	2019	and	for	our	fiscal	quarter	ended	March 30,	2019	no	later	than	July	31,	2019.	The	filing	of	this	Annual	Report	on	Form	10-K	will	constitute	compliance	with	the	requirement	to	furnish	the	lenders	a	copy	of	the consolidated	financial	statements	for	our	fiscal	year	ended	December	29,	2018	no	later	than	June	28,	2019.	We	also	currently	expect	to	file	our	Quarterly	Report	on	Form 10-Q	for	the	quarter	ended	March	30,	2019	on	or	before	July	31,	2019	in	compliance	with	the	requirement	to	furnish	the	lenders	a	copy	of	the	consolidated	financial statements	for	such	quarter	no	later	than	July	31,	2019.	For	further	information	related	to	the	two	waiver	agreements,	see	Liquidity	and	Capital	Resources	in	Item	7, Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations.

However,	we	may	not	be	able	to	secure	similar	waivers	for	any	future	delays	in	our	periodic	reports	with	the	SEC.	Furthermore,	if	we	breach	any	covenants	under	our indebtedness	instruments	and	seek	a	waiver,	we	may	not	be	able	to	obtain	a	waiver	from	the	required	creditors,	or	we	may	not	be	able	to	remedy	compliance	within	the terms	of	any	waivers	approved	by	the	required	creditors.	If	this	occurs,	we	would	be	in	default	under	our	indebtedness	instruments	and	unable	to	access	our	Senior	Credit Facility.	In	addition,	certain	creditors	could	exercise	their	rights,	as	described	above,	and	we	could	be	forced	into	bankruptcy	or	liquidation.

# Additional	impairments	of	the	carrying	amounts	of	goodwill	or	other	indefinite-lived	intangible	assets	could	negatively	affect	our	financial	condition	and	results	of operations.

Our	goodwill	balance	consists	of	20	reporting	units,	and	our	indefinite-lived	intangible	asset	balance	primarily	consists	of	a	number	of	individual	brands.	We	test	our reporting	units	and	brands	for	impairment	annually	as	of	the	first	day	of	our	second	quarter,	or	more	frequently	if	events	or	circumstances	indicate	it	is	more	likely	than not	that	the	fair	value	of	a	reporting	unit	or	brand	is	less	than	its	carrying	amount.	Such	events	and	circumstances	could	include	a	sustained	decrease	in	our	market capitalization,	increased	competition	or	unexpected	loss	of	market	share,	increased	input	costs	beyond	projections	(for	example	due	to	regulatory	or	industry	changes), disposals	of	significant	brands	or	components	of	our	business,	unexpected	business	disruptions	(for	example	due	to	a	natural	disaster	or	loss	of	a	customer,	supplier,	or other	significant	business	relationship),	unexpected	significant	declines	in	operating	results,	or	significant	adverse	changes	in	the	markets	in	which	we	operate.	We	test reporting	units	for	impairment	by	comparing	the	estimated	fair	value	of	each	reporting	unit	with	its	carrying	amount.	We	test	brands	for	impairment	by	comparing	the estimated	fair	value	of	each	brand	with	its	carrying	amount.	If	the	carrying	amount	of	a	reporting	unit	or	brand	exceeds	its	estimated	fair	value,	we	record	an	impairment loss	based	on	the	difference	between	fair	value	and	carrying	amount,	in	the	case	of	reporting	units,	not	to	exceed	to	the	associated	carrying	amount	of	goodwill.

As	detailed	in	Note	10,	Goodwill	and	Intangible	Assets,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	as	a	result	of	our	2018	annual	impairment	test	in	the second	quarter	of	2018,	we	recognized	a	goodwill	impairment	loss	of	$133	million	and	an	indefinite-lived	intangible	asset	impairment	loss	of	$101	million.	Additionally, as	part	of	our	interim	impairment	test	in	the	third	quarter	of	2018,	we	recognized	an	indefinite-lived	intangible	asset	impairment	loss	of	$215	million	and	a	definite-lived intangible	asset	impairment	loss	of	$3	million.

For	the	fourth	quarter	of	2018,	in	connection	with	the	preparation	of	our	year-end	financial	statements,	we	assessed	the	changes	in	circumstances	that	occurred	during	the quarter	to	determine	if	it	was	more	likely	than	not	that	the	fair	values	of	any	reporting	units	or	brands	were	below	their	carrying	amounts.	Although	our	annual impairment	test	is	performed	during	the	second	quarter,	we	perform	this	qualitative	assessment	each	interim	reporting	period.

While	there	was	no	single	determinative	event	or	factor,	the	consideration	in	totality	of	several	factors	that	developed	during	the	fourth	quarter	of	2018	led	us	to	conclude that	it	was	more	likely	than	not	that	the	fair	values	of	certain	reporting	units	and	brands	were	below	their	carrying	amounts.	These	factors	included:	(i)	a	sustained decrease	in	our	share	price	in	November	and	December	of	2018,	which	reduced	our	market	capitalization	below	the	book	value	of	net	assets;	(ii)	the	completion	of	our fourth	quarter	results,	which	were	below	management's	expectations	due	to	several	factors	such	as	higher	than	expected	supply	chain	costs	and	increased	competition; (iii)	the	development	and	approval	of	our	2019	annual	operating	plan	in	December	2018,	which	provided	additional	insights	into	expectations	and	priorities	for	the coming	years,	such	as	lower	growth	and	margin	expectations;	(iv)	the	announcement	in	November	2018	to	sell	certain	assets	in	our	natural	cheese	portfolio	in	Canada, which	changed	the	composition	and	use	of	the	remaining	assets	and	brands	in	the	associated	reporting	unit;	(v)	fluctuations	in	foreign	exchange	rates	in	certain	countries; (vi)	increased	interest	rates	in	certain	locations,	including	an	increase	in	the	United	States	in	December	2018;	and	(vii)	increased	and	prolonged	economic	and	regulatory uncertainty	in	the	United	States	and	global	economies	as	of	the	end	of	December	2018.

Accordingly,	we	performed	an	interim	impairment	test	on	these	reporting	units	and	brands	as	of	December	29,	2018.	As	a	result	of	our	interim	impairment	test,	we recognized	goodwill	impairment	losses	of	$6.9	billion	and	indefinite-lived	intangible	asset	impairment	losses	of	$8.6	billion	in	the	fourth	quarter	of	2018.

Fair	value	determinations	require	considerable	judgment	and	are	sensitive	to	changes	in	underlying	assumptions,	estimates,	and	market	factors.	Estimating	the	fair	value of	 individual	reporting	 units	 and	 brands	requires	us	to	make	assumptions	and	estimates	regarding	our	future	plans,	as	well	as	industry,	economic,	and	regulatory conditions.	These	assumptions	and	estimates	include	estimated	future	annual	net	cash	flows,	income	tax	considerations,	discount	rates,	growth	rates,	royalty	rates, contributory	asset	charges,	and	other	market	factors.	If	current	expectations	of	future	growth	rates	and	margins	are	not	met,	if	market	factors	outside	of	our	control,	such as	discount	rates,	change,	or	if	management's	expectations	or	plans	otherwise	change,	including	as	a	result	of	the	development	of	our	global	five-year	operating	plan, then	one	or	more	of	our	reporting	units	or	brands	might	become	impaired	in	the	future.	As	detailed	in	Note	10,	Goodwill	and	Intangible	Assets,	 in	Item	8,	Financial Statements	and	Supplementary	Data,	we	recorded	impairment	losses	totaling	$15.9	billion	for	the	year	ended	December	29,	2018.	 Our	reporting	units	and	brands	that were	impaired	in	2018	were	written	down	to	their	respective	fair	values	resulting	in	zero	excess	fair	value	over	carrying	amount	as	of	their	latest	2018	impairment	testing dates.	Accordingly,	these	and	other	individual	reporting	units	and	brands	that	have	20%	or	less	excess	fair	value	over	carrying	amount	as	of	their	latest	testing	date	have	a heightened	risk	of	future	impairments	if	any	assumptions,	estimates,	or	market	factors	change	in	the	future.	Reporting	units	with	a	heightened	risk	of	future	impairments had	an	aggregate	goodwill	carrying	amount	of	$29.0	billion	at	December	29,	2018	and	included:	U.S.	Grocery,	U.S.	Refrigerated,	Canada	Retail,	Latin	America	Exports, Southeast	Europe,	Australia	and	New	Zealand,	and	Northeast	Asia.	Of	 the	$29.0	billion	with	a	heightened	risk	of	future	impairments,	$9.3	billion	is	attributable	to reporting	units	with	0%	excess	fair	value	over	carrying	amount.	Brands	with	a	heightened	risk	of	future	impairments	had	an	aggregate	carrying	amount	of	$29.3	billion	at December	29,	2018	and	included:	Kraft,	Philadelphia,	Oscar	Mayer,	Velveeta,	Miracle	Whip,	Planters,	A1,	Cool	Whip,	Stove	Top,	ABC,	and	Quero.	Of	the	$29.3	billion with	a	heightened	risk	of	future	impairments,	$24.0	billion	is	attributable	to	brands	with	0%	excess	fair	value	over	carrying	amount.	Although	the	remaining	reporting units	and	brands	have	more	than	20%	excess	fair	value	over	carrying	amount	as	of	their	latest	2018	impairment	testing	date,	these	amounts	are	also	associated	with	the 2013	Heinz	acquisition	and	the	2015	Merger	and	are	recorded	on	the	balance	sheet	at	their	estimated	acquisition	date	fair	values.	Therefore,	if	any	assumptions, estimates,	or	market	factors	change	in	the	future,	these	amounts	are	also	susceptible	to	impairments,	which	could	negatively	affect	our	operating	results	or	net	worth.

# Our	net	sales	and	net	income	may	be	exposed	to	foreign	exchange	rate	fluctuations.

We	derive	a	substantial	portion	of	our	net	sales	from	international	operations.	We	hold	assets	and	incur	liabilities,	earn	revenue,	and	pay	expenses	in	a	variety	of currencies	other	than	the	U.S.	dollar,	primarily	the	British	pound	sterling,	euro,	Australian	dollar,	Canadian	dollar,	New	Zealand	dollar,	Brazilian	real,	Indonesian	rupiah, Chinese	renminbi,	and	Indian	rupee.	Since	our	consolidated	financial	statements	are	reported	in	U.S.	dollars,	fluctuations	in	exchange	rates	from	period	to	period	will have	an	impact	on	our	reported	results.	We	have	implemented	currency	hedges	intended	to	reduce	our	exposure	to	changes	in	foreign	currency	exchange	rates.	However, these	hedging	strategies	may	not	be	successful,	and	any	of	our	unhedged	foreign	exchange	exposures	will	continue	to	be	subject	to	market	fluctuations.	In	addition,	in certain	circumstances,	we	may	incur	costs	in	one	currency	related	to	services	or	products	for	which	we	are	paid	in	a	different	currency.	As	a	result,	factors	associated	with international	operations,	including	changes	in	foreign	currency	exchange	rates,	could	significantly	affect	our	results	of	operations	and	financial	condition.

# Commodity,	energy,	and	other	input	prices	are	volatile	and	could	negatively	affect	our	consolidated	operating	results.

We	purchase	and	use	large	quantities	of	commodities,	including	dairy	products,	meat	products,	coffee	beans,	nuts,	tomatoes,	potatoes,	soybean	and	vegetable	oils,	sugar and	other	sweeteners,	corn	products,	wheat	products,	cucumbers,	onions,	other	fruits	and	vegetables,	spices,	and	flour	to	manufacture	our	products.	In	addition,	we purchase	and	use	significant	quantities	of	resins,	metals,	cardboard,	glass,	plastic,	paper,	fiberboard,	and	other	materials	to	package	our	products,	and	we	use	other	inputs, such	as	natural	gas	and	water,	to	operate	our	facilities.	We	are	also	exposed	to	changes	in	oil	prices,	which	influence	both	our	packaging	and	transportation	costs.	Prices for	commodities,	energy,	and	other	supplies	are	volatile	and	can	fluctuate	due	to	conditions	that	are	difficult	to	predict,	including	global	competition	for	resources, currency	fluctuations,	severe	weather	or	global	climate	change,	crop	failures,	or	shortages	due	to	plant	disease	or	insect	and	other	pest	infestation,	consumer,	industrial,	or investment	demand,	and	changes	in	governmental	regulation	and	trade,	tariffs,	alternative	energy,	including	increased	demand	for	biofuels,	and	agricultural	programs. Additionally,	we	may	be	unable	to	maintain	favorable	arrangements	with	respect	to	the	costs	of	procuring	raw	materials,	packaging,	services,	and	transporting	products, which	could	result	in	increased	expenses	and	negatively	affect	our	operations.	Furthermore,	the	cost	of	raw	materials	and	finished	products	may	fluctuate	due	to movements	in	cross-currency	transaction	rates.	Rising	commodity,	energy,	and	other	input	costs	could	materially	and	adversely	affect	our	cost	of	operations,	including the	manufacture,	transportation,	and	distribution	of	our	products,	which	could	materially	and	adversely	affect	our	financial	condition	and	operating	results.

Although	we	monitor	our	exposure	to	commodity	prices	as	an	integral	part	of	our	overall	risk	management	program,	and	seek	to	hedge	against	input	price	increases	to	the extent	we	deem	appropriate,	we	do	not	fully	hedge	against	changes	in	commodity	prices,	and	our	hedging	strategies	may	not	protect	us	from	increases	in	specific	raw materials	costs.	For	example,	hedging	our	costs	for	one	of	our	key	commodities,	dairy	products,	is	difficult	because	dairy	futures	markets	are	not	as	developed	as	many other	commodities	futures	markets.	Continued	volatility	or	sustained	increases	in	the	prices	of	commodities	and	other	supplies	we	purchase	could	increase	the	costs	of our	products,	and	our	profitability	could	suffer.	Moreover,	increases	in	the	prices	of	our	products	to	cover	these	increased	costs	may	result	in	lower	sales	volumes,	or	we may	be	constrained	from	increasing	the	prices	of	our	products	by	competitive	and	consumer	pressures.	If	we	are	not	successful	in	our	hedging	activities,	or	if	we	are unable	to	price	our	products	to	cover	increased	costs,	then	commodity	and	other	input	price	volatility	or	increases	could	materially	and	adversely	affect	our	financial condition	and	operating	results.

# Volatility	in	the	market	value	of	all	or	a	portion	of	the	derivatives	we	use	to	manage	exposures	to	fluctuations	in	commodity	prices	may	cause	volatility	in	our	gross profit	and	net	income.

We	use	commodity	futures,	options,	and	swaps	to	economically	hedge	the	price	of	certain	input	costs,	including	dairy	products,	meat	products,	coffee	beans,	sugar, vegetable	oils,	wheat	products,	corn	products,	cocoa	products,	packaging	products,	diesel	fuel,	and	natural	gas.	We	recognize	gains	and	losses	based	on	changes	in	the values	of	these	commodity	derivatives.	We	recognize	these	gains	and	losses	in	cost	of	products	sold	in	our	consolidated	statements	of	income	to	the	extent	we	utilize	the underlying	input	in	our	manufacturing	process.	We	recognize	these	gains	and	losses	in	general	corporate	expenses	in	our	segment	operating	results	until	we	sell	the underlying	products,	at	which	time	we	reclassify	the	gains	and	losses	to	segment	operating	results.	Accordingly,	changes	in	the	values	of	our	commodity	derivatives	may cause	volatility	in	our	gross	profit	and	net	income.

# Our	results	could	be	adversely	impacted	as	a	result	of	increased	pension,	labor,	and	people-related	expenses.

Inflationary	pressures	and	any	shortages	in	the	labor	market	could	increase	labor	costs,	which	could	have	a	material	adverse	effect	on	our	consolidated	operating	results or	financial	condition.	Our	labor	costs	include	the	cost	of	providing	employee	benefits	in	the	United	States,	Canada,	and	other	foreign	jurisdictions,	including	pension, health	and	welfare,	and	severance	benefits.	Any	declines	in	market	returns	could	adversely	impact	the	funding	of	pension	plans,	the	assets	of	which	are	invested	in	a diversified	portfolio	of	equity	and	fixed-income	securities	and	other	investments.	Additionally,	the	annual	costs	of	benefits	vary	with	increased	costs	of	health	care	and the	outcome	of	collectively-bargained	wage	and	benefit	agreements.

Furthermore,	we	may	be	subject	to	increased	costs	or	experience	adverse	effects	to	our	operating	results	if	we	are	unable	to	renew	collectively	bargained	agreements	on satisfactory	terms.	Our	financial	condition	and	ability	to	meet	the	needs	of	our	customers	could	be	materially	and	adversely	affected	if	strikes	or	work	stoppages	and interruptions	occur	as	a	result	of	delayed	negotiations	with	union-represented	employees	both	in	and	outside	of	the	United	States.

# Regulatory	Risks

# Compliance	with	laws,	regulations,	and	related	interpretations	and	related	legal	claims	or	other	regulatory	enforcement	actions	could	impact	our	business,	and	we face	additional	risks	and	uncertainties	related	to	any	potential	actions	resulting	from	the	SEC's	ongoing	investigation,	as	well	as	potential	additional	subpoenas, litigation,	and	regulatory	proceedings.

As	a	large,	global	food	and	beverage	company,	we	operate	in	a	highly-regulated	environment	with	constantly-evolving	legal	and	regulatory	frameworks.	Various	laws and	regulations	govern	production,	storage,	distribution,	sales,	advertising,	labeling,	including	on-pack	claims,	information	or	disclosures,	marketing,	licensing,	trade, labor,	tax,	environmental	matters,	privacy,	as	well	as	health	and	safety	and	data	protection	practices.	Government	authorities	regularly	change	laws	and	regulations	and their	interpretations.	In	particular,	Brexit	could	result	in	a	new	regulatory	regime	in	the	United	Kingdom	that	may	or	may	not	follow	that	of	the	European	Union,	and	the creation	of	new	and	divergent	laws	and	regulations	could	increase	the	cost	and	complexity	of	our	compliance.	In	addition,	this	shift	in	regime	could	create	a	number	of legal	and	accounting	complexities	with	respect	to	existing	relationships,	including	uncertainty	regarding	the	continuity	of	contracts	entered	into	by	entities	in	the	United Kingdom	or	the	European	Union.	Our	compliance	with	new	or	revised	laws	and	regulations,	or	the	interpretation	and	application	of	existing	laws	and	regulations,	could materially	and	adversely	affect	our	product	sales,	financial	condition,	and	results	of	operations.	As	a	consequence	of	the	legal	and	regulatory	environment	in	which	we operate,	we	are	faced	with	a	heightened	risk	of	legal	claims	and	regulatory	enforcement	actions.

As	previously	disclosed	on	February	21,	2019,	we	received	a	subpoena	in	October	2018	from	the	SEC	related	to	our	procurement	area,	specifically	the	accounting policies,	procedures,	and	internal	controls	related	to	our	procurement	function,	including,	but	not	limited	to,	agreements,	side	agreements,	and	changes	or	modifications to	agreements	with	our	suppliers.	Following	the	receipt	of	this	subpoena,	we,	together	with	external	counsel	and	forensic	accountants,	and	subsequently,	under	the oversight	of	the	Audit	Committee,	conducted	an	internal	investigation	into	our	procurement	area	and	related	matters.	Following	our	earnings	release	and	investor	call	on February	21,	2019,	when	we	announced	the	results	of	our	interim	assessment	of	goodwill	and	intangible	asset	impairments,	the	SEC	requested	additional	information related	to	our	financial	reporting,	internal	controls,	and	disclosures,	our	assessment	of	goodwill	and	intangible	asset	impairments,	and	our	communications	with	certain shareholders.	It	is	our	understanding	that	the	United	States	Attorney's	Office	for	the	Northern	District	of	Illinois	also	is	reviewing	this	matter,	working	with	the	SEC	and receiving	materials	from	it.	After	our	earnings	release,	four	securities	class	action	lawsuits,	one	class	action	lawsuit	under	the	Employee	Retirement	Income	Security	Act ("ERISA"),	and	five	stockholder	derivative	actions	were	filed	against	us	and	certain	of	our	current	and	former	officers,	directors,	and	employees.	One	of	the	securities class	action	lawsuits	was	voluntarily	dismissed	without	prejudice,	while	the	other	matters	are	still	pending.

We	intend	to	vigorously	defend	against	these	lawsuits.	We	are	unable,	at	this	time,	to	estimate	our	potential	liability	in	these	matters,	but	we	may	be	required	to	pay judgments,	settlements,	or	other	penalties	and	incur	other	costs	and	expenses	in	connection	with	the	securities	and	ERISA	class	action	lawsuits	and	the	stockholder derivative	actions.	See	Item	3,	Legal	Proceedings,	and	Note	18,	Commitment	and	Contingencies,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	additional information.

Furthermore,	if	the	SEC	commences	legal	action	as	a	result	of	the	investigation,	we	could	be	required	to	pay	significant	penalties	and	become	subject	to	injunctions, cease	and	desist	orders,	and	other	equitable	remedies.	The	SEC	investigation	will	not	be	resolved	as	a	result	of	the	completion	of	the	internal	investigation	and	the	filing of	this	Annual	Report	on	Form	10-K.	We	can	provide	no	assurances	as	to	the	outcome	or	timing	of	any	governmental	or	regulatory	investigation.

We	 have	 incurred,	 and	 may	 continue	 to	 incur,	 significant	 expenses	 related	 to	 legal,	 accounting,	 and	 other	 professional	 services	 in	 connection	 with	 the	 internal investigation,	the	SEC	investigation,	and	related	legal	and	regulatory	matters.	These	expenses,	the	delay	in	timely	filing	this	Annual	Report	on	Form	10-K,	the	delay	in timely	filing	our	Quarterly	Report	on	Form	10-Q	for	the	fiscal	quarter	ended	March	30,	2019,	and	the	diversion	of	the	attention	of	the	management	team	that	has occurred,	and	is	expected	to	continue,	has	adversely	affected,	and	could	continue	to	adversely	affect,	our	business,	financial	condition,	and	cash	flows.

As	a	result	of	matters	associated	with	the	internal	investigation	related	to	the	SEC	investigation	and	various	lawsuits,	we	are	exposed	to	greater	risks	associated	with litigation,	regulatory	proceedings,	and	government	enforcement	actions	and	additional	subpoenas.	Any	future	investigations	or	additional	lawsuits	may	have	a	material adverse	effect	on	our	business,	financial	condition,	results	of	operations,	and	cash	flows.

We	identified	material	weaknesses	in	our	internal	control	over	financial	reporting.	If	we	are	unable	to	remediate	these	material	weaknesses,	or	if	we	experience additional	material	weaknesses	or	other	deficiencies	in	the	future	or	otherwise	fail	to	maintain	an	effective	system	of	internal	controls,	we	may	not	be	able	to accurately	and	timely	report	our	financial	results,	in	which	case	our	business	may	be	harmed,	investors	may	lose	confidence	in	the	accuracy	and	completeness	of our	financial	reports,	and	the	price	of	our	common	stock	may	decline.

Our	management	is	responsible	for	establishing	and	maintaining	adequate	internal	control	over	financial	reporting	and	for	evaluating	and	reporting	on	the	effectiveness	of our	system	of	internal	control.	Our	internal	control	over	financial	reporting	is	a	process	designed	to	provide	reasonable	assurance	regarding	the	reliability	of	financial reporting	and	the	preparation	of	financial	statements	for	external	reporting	purposes	in	accordance	with	accounting	principles	generally	accepted	in	the	United	States	of America	("U.S.	GAAP").	As	a	public	company,	we	are	required	to	comply	with	the	Sarbanes-Oxley	Act	and	other	rules	that	govern	public	companies.	In	particular,	we are	required	to	certify	our	compliance	with	Section	404	of	the	Sarbanes-Oxley	Act,	which	requires	us	to	furnish	annually	a	report	by	management	on	the	effectiveness	of our	internal	control	over	financial	reporting.	In	addition,	our	independent	registered	public	accounting	firm	is	required	to	report	on	the	effectiveness	of	our	internal control	over	financial	reporting.

In	connection	with	our	most	recent	year-end	assessment	of	internal	control	over	financial	reporting,	we	determined	that,	as	of	December	29,	2018,	we	did	not	maintain effective	internal	control	over	financial	reporting	because	of	a	material	weakness	in	our	risk	assessment	process	related	to	designing	and	maintaining	controls	sufficient	to appropriately	respond	to	changes	in	our	business	environment.	This	material	weakness	in	risk	assessment	also	contributed	to	material	weaknesses	arising	from	(i) supplier	contracts	and	related	arrangements,	and	(ii)	goodwill	and	indefinite-lived	intangible	asset	impairment	testing,	and	we	have	taken	and	are	taking	certain	remedial steps	to	improve	our	internal	control	over	financial	reporting.	For	further	discussion	of	the	material	weaknesses	identified	and	our	remedial	efforts,	see	Item	9A,	Controls and	Procedures.

Remediation	efforts	place	a	significant	burden	on	management	and	add	increased	pressure	to	our	financial	resources	and	processes.	As	a	result,	we	may	not	be	successful in	making	the	improvements	necessary	to	remediate	the	material	weaknesses	identified	by	management,	be	able	to	do	so	in	a	timely	manner,	or	be	able	to	identify	and remediate	additional	control	deficiencies,	including	material	weaknesses,	in	the	future.

If	we	are	unable	to	successfully	remediate	our	existing	or	any	future	material	weaknesses	or	other	deficiencies	in	our	internal	control	over	financial	reporting,	the accuracy	and	timing	of	our	financial	reporting	may	be	adversely	affected;	our	liquidity,	our	access	to	capital	markets,	the	perceptions	of	our	creditworthiness,	and	our ability	to	complete	acquisitions	may	be	adversely	affected;	we	may	be	unable	to	maintain	or	regain	compliance	with	applicable	securities	laws,	The	Nasdaq	Stock	Market LLC	("Nasdaq")	listing	requirements,	and	the	covenants	under	our	debt	instruments	or	derivative	arrangements	regarding	the	timely	filing	of	periodic	reports;	we	may	be subject	to	regulatory	investigations	and	penalties;	investors	may	lose	confidence	in	our	financial	reporting;	we	may	suffer	defaults,	accelerations,	or	cross-accelerations under	our	debt	instruments	or	derivative	arrangements	to	the	extent	we	are	unable	to	obtain	waivers	from	the	required	creditors	or	counterparties	or	are	unable	to	cure any	breaches;	and	our	stock	price	may	decline.

Our	failure	to	prepare	and	timely	file	our	periodic	reports	with	the	SEC	limits	our	access	to	the	public	markets	to	raise	debt	or	equity	capital,	restricts	our	ability	to issue	equity	securities,	including	within	the	Kraft	Heinz	Savings	Plan	and	the	Kraft	Heinz	Union	Savings	Plan	(collectively,	the	"Plan"),	and	could	impact	our listing	on	Nasdaq.

We	did	not	file	our	Annual	Report	on	Form	10-K	for	the	year	ended	December	29,	2018	or	our	Quarterly	Report	on	Form	10-Q	for	the	fiscal	quarter	ended	March	30, 2019	within	each	respective	timeframe	required	by	the	SEC,	meaning	we	have	not	remained	current	in	our	reporting	requirements	with	the	SEC.	This	limits	our	ability	to access	the	public	markets	to	raise	debt	or	equity	capital,	which	could	prevent	us	from	pursuing	transactions	or	implementing	business	strategies	that	we	might	otherwise believe	are	beneficial	to	our	business.	We	are	not	currently	eligible	to	use	a	registration	statement	on	Form	S-3	that	would	allow	us	to	continuously	incorporate	by reference	our	SEC	reports	into	the	registration	statement,	or	to	use	"shelf"	registration	statements	to	conduct	offerings,	until	approximately	one	year	from	the	date	we regain	and	maintain	status	as	a	current	filer.	If	we	wish	to	pursue	a	public	offering	now,	we	would	be	required	to	file	a	registration	statement	on	Form	S-1	and	have	it reviewed	and	declared	effective	by	the	SEC.	Doing	so	would	likely	take	significantly	longer	than	using	a	registration	statement	on	Form	S-3	and	increase	our	transaction costs,	and	the	necessity	of	using	a	Form	S-1	for	a	public	offering	of	registered	securities	could,	to	the	extent	we	are	not	able	to	conduct	offerings	using	alternative methods,	adversely	impact	our	ability	to	raise	capital	or	complete	acquisitions	of	other	companies	in	a	timely	manner.

In	addition,	as	a	result	of	the	failure	to	remain	current	in	our	reporting	requirements	with	the	SEC,	we	are	not	currently	eligible	to	use	Form	S-8	registration	statements. As	a	result,	on	April	23,	2019,	the	administrator	of	the	Plan	issued	a	notice	to	Plan	participants	advising	participants	of	a	blackout	period	during	which	participants	are prohibited	from	acquiring	beneficial	ownership	of	additional	interests	in	The	Kraft	Heinz	Company	Stock	Fund.	If	we	are	not	able	to	become	and	remain	current	in	our reporting	requirements	with	the	SEC,	it	restricts	our	ability	to	maintain	The	Kraft	Heinz	Company	Stock	Fund	or	issue	other	equity	securities	to	our	employees.

As	previously	disclosed,	we	also	received	notices	from	Nasdaq	regarding	our	noncompliance	with	Nasdaq	Listing	Rule	5250(c)(1),	which	requires	listed	companies	to timely	file	all	required	periodic	financial	reports	with	the	SEC.	We	timely	submitted	our	plan	to	regain	compliance,	and	Nasdaq	granted	the	Company	until	September 11,	2019	to	regain	compliance,	subject	to	our	compliance	with	certain	terms	outlined	in	the	notice	received	on	May	15,	2019,	including	filing	this	Annual	Report	on	Form 10-K	for	the	fiscal	year	ended	December	29,	2018	and	filing	our	Quarterly	Report	on	Form	10-Q	for	the	fiscal	quarter	ended	March	30,	2019,	which	we	expect	to	file	as promptly	as	practicable	following	the	filing	of	this	Annual	Report	on	Form	10-K.	If	we	are	not	able	to	file	before	September	11,	2019,	however,	our	common	stock	may be	subject	to	delisting	by	Nasdaq.

# We	reached	a	determination	to	restate	certain	of	our	previously	issued	consolidated	financial	statements,	which	resulted	in	unanticipated	costs	and	may	affect investor	confidence	and	raise	reputational	issues.

As	discussed	 in	 the	Explanatory	Note, in	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements,	 and in	 Note	 23,	Quarterly	Financial	Data (Unaudited),	in	this	Annual	Report	on	Form	10-K,	we	reached	a	determination	to	restate	our	consolidated	financial	statements	and	related	disclosures	for	the	years	ended December	30,	2017	and	December	31,	2016	and	to	restate	each	of	the	quarterly	and	year-to-date	periods	for	the	nine	months	ended	September	29,	2018	and	for	fiscal year	2017,	following	the	identification	of	misstatements	as	a	result	of	the	internal	investigation	conducted.	We	do	not	believe	that	the	misstatements	are	quantitatively material	to	any	period	presented	in	our	prior	financial	statements.	However,	due	to	the	qualitative	nature	of	the	matters	identified	in	our	internal	investigation,	including the	number	of	years	over	which	the	misconduct	occurred	and	the	number	of	transactions,	suppliers,	and	procurement	employees	involved,	we	determined	that	it	would	be appropriate	to	correct	the	misstatements	in	our	previously	issued	consolidated	financial	statements	by	restating	such	financial	statements.	The	restatement	also	included corrections	for	additional	identified	out-of-period	and	uncorrected	misstatements	in	the	impacted	periods.	As	a	result,	we	have	incurred	unanticipated	costs	for	accounting and	legal	fees	in	connection	with	or	related	to	the	restatement,	and	have	become	subject	to	a	number	of	additional	risks	and	uncertainties,	which	may	affect	investor confidence	in	the	accuracy	of	our	financial	disclosures	and	may	raise	reputational	issues	for	our	business.

# Our	intellectual	property	rights	are	valuable,	and	any	inability	to	protect	them	could	reduce	the	value	of	our	products	and	brands.

We	consider	our	intellectual	property	rights,	particularly	and	most	notably	our	trademarks,	but	also	our	patents,	trade	secrets,	trade	dress,	copyrights,	and	licensing agreements,	to	be	a	significant	and	valuable	aspect	of	our	business.	We	attempt	to	protect	our	intellectual	property	rights	through	a	combination	of	patent,	trademark, copyright,	trade	secret,	and	trade	dress	laws,	as	well	as	licensing	agreements,	third-party	nondisclosure	and	assignment	agreements,	and	policing	of	third-party	misuses	of our	intellectual	property.	Our	failure	to	develop	or	adequately	protect	our	trademarks,	products,	new	features	of	our	products,	or	our	technology,	or	any	change	in	law	or other	changes	that	serve	to	lessen	or	remove	the	current	legal	protections	of	our	intellectual	property,	may	diminish	our	competitiveness	and	could	materially	harm	our business	and	financial	condition.	We	also	license	certain	intellectual	property,	most	notably	trademarks,	from	third	parties.	To	the	extent	that	we	are	not	able	to	contract with	these	third	parties	on	favorable	terms	or	maintain	our	relationships	with	these	third	parties,	our	rights	to	use	certain	intellectual	property	could	be	impacted.

We	may	be	unaware	of	intellectual	property	rights	of	others	that	may	cover	some	of	our	technology,	brands,	or	products.	Any	litigation	regarding	patents	or	other intellectual	property	could	be	costly	and	time-consuming	and	could	divert	the	attention	of	our	management	and	key	personnel	from	our	business	operations.	Third-party claims	of	intellectual	property	infringement	might	also	require	us	to	enter	into	costly	license	agreements.	We	also	may	be	subject	to	significant	damages	or	injunctions against	development	and	sale	of	certain	products.

# Changes	in	tax	laws	and	interpretations	could	adversely	affect	our	business.

We	are	subject	to	income	and	other	taxes	in	the	United	States	and	in	numerous	foreign	jurisdictions.	Our	domestic	and	foreign	tax	liabilities	are	dependent	on	the jurisdictions	in	which	profits	are	determined	to	be	earned	and	taxed.	Additionally,	the	amount	of	taxes	paid	is	subject	to	our	interpretation	of	applicable	tax	laws	in	the jurisdictions	in	which	we	operate.	A	number	of	factors	influence	our	effective	tax	rate,	including	changes	in	tax	laws	and	treaties	as	well	as	the	interpretation	of	existing laws	and	rules.	Federal,	state,	and	local	governments	and	administrative	bodies	within	the	United	States,	which	represents	the	majority	of	our	operations,	and	other foreign	jurisdictions	have	implemented,	or	are	considering,	a	variety	of	broad	tax,	trade,	and	other	regulatory	reforms	that	may	impact	us.	For	example,	the	Tax	Cuts	and Jobs	Act	(the	"U.S.	Tax	Reform")	enacted	on	December	22,	2017	resulted	in	changes	in	our	corporate	tax	rate,	our	deferred	income	taxes,	and	the	taxation	of	foreign earnings.	The	comprehensive	impact	of	U.S.	Tax	Reform	is	yet	to	be	determined,	and	future	guidance	and	interpretations	may	have	adverse	or	uncertain	effects. Relatedly,	changes	in	tax	laws	resulting	from	the	Organization	for	Economic	Co-operation	and	Development's	("OECD")	multi-jurisdictional	plan	of	action	to	address base	erosion	and	profit	sharing	("BEPS")	could	impact	our	effective	tax	rate.	It	is	not	currently	possible	to	accurately	determine	the	potential	comprehensive	impact	of these	or	future	changes,	but	these	changes	could	have	a	material	impact	on	our	business	and	financial	condition.

Significant	judgment,	knowledge,	and	experience	are	required	in	determining	our	worldwide	provision	for	income	taxes.	Our	future	effective	tax	rate	is	impacted	by	a number	of	factors	including	changes	in	the	valuation	of	our	deferred	tax	assets	and	liabilities,	changes	in	geographic	mix	of	income,	increases	in	expenses	not	deductible for	tax,	including	impairment	of	goodwill,	and	changes	in	available	tax	credits.	In	the	ordinary	course	of	our	business,	there	are	many	transactions	and	calculations	where the	ultimate	tax	determination	is	uncertain.	We	are	also	regularly	subject	to	audits	by	tax	authorities.	Although	we	believe	our	tax	estimates	are	reasonable,	the	final determination	of	tax	audits	and	any	related	litigation	could	be	materially	different	from	our	historical	income	tax	provisions	and	accruals.	Economic	and	political pressures	to	increase	tax	revenue	in	various	jurisdictions	may	make	resolving	tax	disputes	more	difficult.	The	results	of	an	audit	or	litigation	could	adversely	affect	our financial	statements	in	the	period	or	periods	for	which	that	determination	is	made.

# Registered	Securities	Risks

# Sales	of	our	common	stock	in	the	public	market	could	cause	volatility	in	the	price	of	our	common	stock	or	cause	the	share	price	to	fall.

Sales	of	a	substantial	number	of	shares	of	our	common	stock	in	the	public	market,	sales	of	our	common	stock	by	the	Sponsors,	or	the	perception	that	these	sales	might occur,	could	depress	the	market	price	of	our	common	stock,	and	could	impair	our	ability	to	raise	capital	through	the	sale	of	additional	equity	securities.	A	sustained depression	in	the	market	price	of	our	common	stock	has	happened	(in	November	and	December	2018,	which	was	a	contributing	factor	to	our	decision	to	perform	an interim	impairment	test	for	certain	reporting	units	and	brands	in	the	fourth	quarter	of	2018,	for	which	we	ultimately	recorded	impairment	losses)	and	could	in	the	future happen,	which	could	also	reduce	our	market	capitalization	below	the	book	value	of	net	assets,	which	could	increase	the	likelihood	of	recognizing	goodwill	or	indefinite- lived	intangible	asset	impairment	losses	that	could	negatively	affect	our	financial	condition	and	results	of	operations.

Kraft	Heinz,	3G	Capital,	and	Berkshire	Hathaway	entered	into	a	registration	rights	agreement	requiring	us	to	register	for	resale	under	the	Securities	Act	all	registrable shares	held	by	3G	Capital	and	Berkshire	Hathaway,	which	represents	all	shares	of	our	common	stock	held	by	the	Sponsors	as	of	the	date	of	the	closing	of	the	2015 Merger.	As	of	December	29,	2018,	registrable	shares	represented	approximately	49%	of	all	outstanding	shares	of	our	common	stock.	Although	the	registrable	shares	are subject	to	certain	holdback	and	suspension	periods,	the	registrable	shares	are	not	subject	to	a	"lock-up"	or	similar	restriction	under	the	registration	rights	agreement. Accordingly,	offers	and	sales	of	a	large	number	of	registrable	shares	may	be	made	pursuant	to	an	effective	registration	statement	under	the	Securities	Act	in	accordance with	the	terms	of	the	registration	rights	agreement.	Sales	of	our	common	stock	by	the	Sponsors	to	other	persons	would	likely	result	in	an	increase	in	the	number	of	shares being	traded	in	the	public	market	and	may	increase	the	volatility	of	the	price	of	our	common	stock.

# Our	ability	to	pay	regular	dividends	to	our	shareholders	and	the	amounts	of	any	such	dividends	are	subject	to	the	discretion	of	the	Board	of	Directors	and	may	be limited	by	our	financial	condition,	debt	agreements,	or	limitations	under	Delaware	law.

Although	it	is	currently	anticipated	that	we	will	continue	to	pay	regular	quarterly	dividends,	any	such	determination	to	pay	dividends	and	the	amounts	thereof	will	be	at the	discretion	of	the	Board	of	Directors	and	will	be	dependent	on	then-existing	conditions,	including	our	financial	condition,	income,	legal	requirements,	including limitations	under	Delaware	law,	debt	agreements,	and	other	factors	the	Board	of	Directors	deems	relevant.	The	Board	of	Directors	has	decided,	and	may	in	the	future decide,	in	its	sole	discretion,	to	change	the	amount	or	frequency	of	dividends	or	discontinue	the	payment	of	dividends	entirely.	For	these	reasons,	shareholders	will	not	be able	to	rely	on	dividends	to	receive	a	return	on	investment.	Accordingly,	realization	of	any	gain	on	shares	of	our	common	stock	may	depend	on	the	appreciation	of	the price	of	our	common	stock,	which	may	never	occur.

# Volatility	of	capital	markets	or	macroeconomic	factors	could	adversely	affect	our	business.

Changes	in	financial	and	capital	markets,	including	market	disruptions,	limited	liquidity,	uncertainty	regarding	Brexit,	and	interest	rate	volatility,	including	as	a	result	of the	use	or	discontinued	use	of	certain	benchmark	rates	such	as	LIBOR,	may	increase	the	cost	of	financing	as	well	as	the	risks	of	refinancing	maturing	debt.	In	addition, our	borrowing	costs	can	be	affected	by	short	and	long-term	ratings	assigned	by	rating	organizations.	A	decrease	in	these	ratings	could	limit	our	access	to	capital	markets and	increase	our	borrowing	costs,	which	could	materially	and	adversely	affect	our	financial	condition	and	operating	results.

Some	of	our	customers	and	counterparties	are	highly	leveraged.	Consolidations	in	some	of	the	industries	in	which	our	customers	operate	have	created	larger	customers, some	of	which	are	highly	leveraged	and	facing	increased	competition	and	continued	credit	market	volatility.	These	factors	have	caused	some	customers	to	be	less profitable,	increasing	our	exposure	to	credit	risk.	A	significant	adverse	change	in	the	financial	and/or	credit	position	of	a	customer	or	counterparty	could	require	us	to assume	greater	credit	risk	relating	to	that	customer	or	counterparty	and	could	limit	our	ability	to	collect	receivables.	This	could	have	an	adverse	impact	on	our	financial condition	and	liquidity.

# Item	1B.	Unresolved	Staff	Comments.

# Item	2.	Properties.

Our	corporate	co-headquarters	are	located	in	Pittsburgh,	Pennsylvania	and	Chicago,	Illinois.	Our	co-headquarters	are	leased	and	house	certain	executive	offices,	our	U.S. business	units,	and	our	administrative,	finance,	legal,	and	human	resource	functions.	We	maintain	additional	owned	and	leased	offices	throughout	the	regions	in	which we	operate.

We	manufacture	our	products	in	our	network	of	manufacturing	and	processing	facilities	located	throughout	the	world.	As	of	December	29,	2018,	we	operated	84 manufacturing	and	processing	facilities.	We	own	81	and	lease	three	of	these	facilities.	Our	manufacturing	and	processing	facilities	count	by	segment	as	of	December	29, 2018	was:

|  | Owned | Leased |
| :--- | :--- | :--- |
| United\tStates | 40 | 1 |
| Canada | 2 | — |
| EMEA | 12 | — |
| Rest\tof\tWorld | 27 | 2 |

We	maintain	all	of	our	manufacturing	and	processing	facilities	in	good	condition	and	believe	they	are	suitable	and	are	adequate	for	our	present	needs.	We	also	enter	into co-manufacturing	arrangements	with	third	parties	if	we	determine	it	is	advantageous	to	outsource	the	production	of	any	of	our	products.

In	the	fourth	quarter	of	2018,	we	announced	our	plans	to	divest	certain	assets	and	operations,	predominantly	in	Canada	and	India,	including	one	owned	manufacturing facility	in	Canada	and	one	owned	and	one	leased	facility	in	India.	See	Note	5,	Acquisitions	and	Divestitures,	in	Item	8,	Financial	Statements	and	Supplementary	Data, for	additional	information	on	these	transactions.

# Item	3.	Legal	Proceedings.

See	Note	18,	Commitments	and	Contingencies,	in	Item	8,	Financial	Statements	and	Supplementary	Data.

# Item	4.	Mine	Safety	Disclosures.

Not	applicable.

# PART	II

# Item	5.	Market	for	Registrant's	Common	Equity,	Related	Stockholder	Matters	and	Issuer	Purchases	of	Equity	Securities.

Our	common	stock	is	listed	on	Nasdaq	under	the	ticker	symbol	"KHC".	At	June	5,	2019,	there	were	approximately	49,000	holders	of	record	of	our	common	stock.

See	Equity	and	Dividends in	Item	7,	Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations,	for	a	discussion	of	cash	dividends declared	on	our	common	stock.

# Comparison	of	Cumulative	Total	Return

The	following	graph	compares	the	cumulative	total	return	on	our	common	stock	with	the	cumulative	total	return	of	the	Standard	&	Poor's	("S&P")	500	Index	and	the S&P	Consumer	Staples	Food	and	Soft	Drink	Products,	which	we	consider	to	be	our	peer	group.	Companies	included	in	the	S&P	Consumer	Staples	Food	and	Soft	Drink Products	index	change	periodically	and	are	presented	on	the	basis	of	the	index	as	it	is	comprised	on	December	29,	2018.	This	graph	covers	the	period	from	July	6,	2015 (the	first	day	our	common	stock	began	trading	on	Nasdaq)	through	December	28,	2018	(the	last	trading	day	of	our	fiscal	year	2018).	The	graph	shows	total	shareholder return	assuming	$100	was	invested	on	July	6,	2015	and	the	dividends	were	reinvested	on	a	daily	basis.

# updated2018tsr.jpg

|  | Kraft	Heinz | S&amp;P	500 | S&amp;P	Consumer	Staples	Food<br>and	Soft	Drink	Products |
| :--- | :--- | :--- | :--- |
| July\t6,\t2015 | $100.00 | $100.00 | $100.00 |
| December\t31,\t2015 | 102.07 | 99.85 | 110.18 |
| December\t30,\t2016 | 125.99 | 111.79 | 114.98 |
| December\t29,\t2017 | 115.44 | 136.20 | 128.53 |
| December\t28,\t2018 | 67.49 | 129.11 | 121.93 |

The	above	performance	graph	shall	not	be	deemed	to	be	"soliciting	material"	or	to	be	"filed"	with	the	SEC	or	subject	to	Regulation	14A	or	14C,	or	to	the	liabilities	of Section	18	of	the	Exchange	Act.

# Issuer	Purchases	of	Equity	Securities	During	the	Three	Months	Ended	December	29,	2018

Our	share	repurchase	activity	in	the	three	months	ended	December	29,	2018	was:

|  | Total	Number<br>of	Shares<br>Purchased(a) | Average	Price<br>Paid	Per	Share | Total	Number	of	Shares<br>Purchased	as	Part	of<br>Publicly	Announced	Plans<br>or	Programs(b) | Approximate	Dollar	Value	of<br>Shares	that	May	Yet	Be<br>Purchased	Under	the	Plans	or<br>Programs |
| :--- | :--- | :--- | :--- | :--- |
| 9/30/2018\t-\t11/3/2018 | 48,358 | $55.58 | — | $— |
| 11/4/2018\t-\t12/1/2018 | 79,925 | 52.18 | — | — |
| 12/2/2018\t-\t12/29/2018 | 231,409 | 49.16 | — | — |
| Total | 359,692 |  | — |  |

(a) Includes	the	following	types	of	share	repurchase	activity,	when	they	occur:	(1)	shares	repurchased	in	connection	with	the	exercise	of	stock	options	(including	periodic	repurchases	using	option exercise	proceeds),	(2)	shares	withheld	for	tax	liabilities	associated	with	the	vesting	of	restricted	stock	units,	and	(3)	shares	repurchased	related	to	employee	benefit	programs	(including	our	annual bonus	swap	program)	or	to	offset	the	dilutive	effect	of	equity	issuances.

(b) We	do	not	have	any	publicly	announced	share	repurchase	plans	or	programs.

# Item	6.	Selected	Financial	Data.

The	following	table	presents	selected	consolidated	financial	data	for	the	last	five	fiscal	years.	Our	fiscal	years	2018,	2017,	and	2016	include	a	full	year	of	Kraft	Heinz results.	Our	fiscal	year	2015	includes	a	full	year	of	Heinz	results	and	post-merger	Kraft	results.	Our	fiscal	year	2014	includes	a	full	year	of	Heinz	results.

Certain	 prior	 period	 amounts	 have	 been	 restated	 for	 the	 correction	 of	 misstatements	 described	 below.	 This	 information	 should	 be	 read	 in	 conjunction	 with	 the "Explanatory	Note"	immediately	preceding	Item	1	of	this	Annual	Report	on	Form	10-K,	with	Item	7,	Management's	Discussion	and	Analysis	of	Financial	Condition	and Results	of	Operations,	and	with	our	consolidated	financial	statements	and	notes	thereto	included	elsewhere	in	this	Annual	Report	on	Form	10-K,	including	further	details related	to	the	misstatements	discussed	in	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements.

|  |  |  |  | (Unaudited) |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  | December\t29, | December\t30, | December\t31, | January\t3, | December\t28, |
|  | 2018 | 2017 | 2016 | 2016 | 2014 |
|  | (52\tweeks) | (52\tweeks) | (52\tweeks)(h) | (53\tweeks) | (52\tweeks) |
|  |  |  | (in\tmillions,\texcept\tper\tshare\tdata) |  |  |
| Period\tEnded: |  |  |  |  |  |
| Net\tsales(a)(b)(c) | $26,268 | $26,076 | $26,300 | $18,318 | $10,922 |
| Income/(loss)(c)(d)(e) | (10,254) | 10,932 | 3,606 | 614 | 672 |
| Income/(loss)\tattributable\tto\tcommon\tshareholders(c)(d)(e) | (10,192) | 10,941 | 3,416 | (299) | (63) |
| Income/(loss)\tper\tcommon\tshare: |  |  |  |  |  |
| Basic(c)(d)(e) | (8.36) | 8.98 | 2.81 | (0.38) | (0.17) |
| Diluted(c)(d)(e) | (8.36) | 8.91 | 2.78 | (0.38) | (0.17) |

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 | January	3,<br>2016 | December	28,<br>2014 |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  | (in\tmillions,\texcept\tper\tshare\tdata) |  |  |
| As\tof: |  |  |  |  |  |
| Total\tassets(b)(c)(e) | 103,461 | 120,092 | 120,617 | 123,110 | 36,571 |
| Long-term\tdebt(b)(c)(f) | 30,770 | 28,308 | 29,712 | 25,148 | 13,358 |
| Redeemable\tpreferred\tstock(g) | — | — | — | 8,320 | 8,320 |
| Cash\tdividends\tper\tcommon\tshare | 2.50 | 2.45 | 2.35 | 1.70 | — |

(a) As	previously	disclosed,	we	adopted	a	new	accounting	standard	related	 to	revenue	recognition	 in	 the	first	quarter	of	2018,	and	at	 the	same	 time,	we	retrospectively	corrected	 immaterial misclassifications	in	our	statements	of	income	principally	related	to	customer	incentive	program	expense	misclassifications.	This	resulted	in	net	sales	decreases	of	$147	million	in	2017,	$152 million	in	2016,	and	$55	million	in	2015.

(b) The	increases	in	net	sales	in	2016	and	in	2015	compared	to	the	prior	year,	and	the	increases	in	total	assets	and	long-term	debt	from	December	28,	2014	to	January	3,	2016,	were	primarily	driven	by the	2015	Merger.

(c) We	have	restated	previously	disclosed	consolidated	financial	data	for	fiscal	years	2017,	2016,	and	2015,	as	well	as	the	related	balance	sheet	dates,	to	correct	misstatements	principally	related	to supplier	contracts	and	related	arrangements,	as	well	as	other	 identified	out-of-period	and	uncorrected	misstatements.	See	Note	2,	Restatement	 of	 Previously	 Issued	 Consolidated	 Financial Statements,	in	Item	8,	Financial	Statements	and	Supplementary	Data ,	for	additional	information.

(d) The	increases	in	income/(loss),	income/(loss)	attributable	to	common	shareholders,	and	basic	and	diluted	income/(loss)	per	common	share	in	2017	compared	to	2016	were	primarily	driven	by	U.S. Tax	Reform,	which	was	enacted	in	December	2017.	See	Note	11,	Income	Taxes,	in	Item	8,	Financial	Statements	and	Supplementary	Data ,	for	additional	information.

(e) The	decreases	in	income/(loss),	income/(loss)	attributable	to	common	shareholders,	and	basic	and	diluted	income/(loss)	per	common	share	in	2018	compared	to	2017,	and	the	decrease	in	total assets	from	December	30,	2017	to	December	29,	2018,	were	primarily	driven	by	non-cash	impairment	losses	in	2018.	See	Note	10,	Goodwill	 and	 Intangible	Assets,	in Item	 8,	Financial Statements	and	Supplementary	Data,	for	additional	information.

(f) Amounts	exclude	the	current	portion	of	long-term	debt.

(g) On	June	7,	2016,	we	redeemed	all	outstanding	shares	of	our	9.00%	cumulative	compounding	preferred	stock,	Series	A	("Series	A	Preferred	Stock").	See Equity	and	Dividends	in	Item	7, Management's	 Discussion	 and	 Analysis	 of	 Financial	 Condition	 and	 Results	 of	 Operations,	along	 with	 Note	 19,	Debt,	 and	 Note	 20,	Capital	Stock, in Item	 8,	Financial	 Statements	 and Supplementary	Data,	for	additional	information.

(h) On	December	9,	2016,	our	Board	of	Directors	approved	a	change	to	our	fiscal	year	end	from	Sunday	to	Saturday.	Effective	December	31,	2016,	we	operate	on	a	52-	or	53-week	fiscal	year	ending on	the	last	Saturday	in	December	in	each	calendar	year.	In	prior	years,	we	operated	on	a	52-	or	53-week	fiscal	year	ending	the	Sunday	closest	to	December	31.	As	a	result,	we	occasionally	have	a 53rd	week	in	a	fiscal	year.	Our	2015	fiscal	year	includes	a	53rd	week	of	activity.

# Item	7.	Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations.

# Overview

The	following	discussion	should	be	read	in	conjunction	with	the	other	sections	of	this	Annual	Report	on	Form	10-K,	including	the	consolidated	financial	statements	and related	notes	contained	in	Item	8,	Financial	Statements	and	Supplementary	Data.

We	have	restated	our	previously	issued	consolidated	financial	statements	contained	in	this	Annual	Report	on	Form	10-K.	Refer	to	the	"Explanatory	Note"	preceding Item	1,	Business,	for	background	on	the	restatement,	the	fiscal	periods	impacted,	control	considerations,	and	other	information.

In	addition,	we	have	restated	certain	previously	reported	financial	information	at	December	30,	2017	and	for	the	fiscal	years	ended	December	30,	2017	and	December 31,	2016	in	this	Item	7,	Management's	Discussion	and	Analysis	of	Financial	Condition	and	Results	of	Operations,	including	but	not	limited	to	information	within	the Consolidated	Results	of	Operations,	Results	of	Operations	by	Segment,	and	Non-GAAP	Financial	Measures	sections.	We	have	also	included	certain	restated	quarterly information	in	the	Supplemental	Quarterly	Financial	Information	section	at	the	end	of	this	item.

See	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	additional	information related	to	the	restatement,	including	descriptions	of	the	misstatements	and	the	impacts	on	our	consolidated	financial	statements.

# Description	of	the	Company:

We	manufacture	and	market	food	and	beverage	products,	including	condiments	and	sauces,	cheese	and	dairy,	meals,	meats,	refreshment	beverages,	coffee,	and	other grocery	products	throughout	the	world.

We	manage	and	report	our	operating	results	through	four	 segments.	We	 have	three	reportable	segments	defined	by	geographic	region:	United	States,	Canada,	and EMEA.	Our	remaining	businesses	are	combined	and	disclosed	as	"Rest	of	World."	Rest	of	World	comprises	two	operating	segments:	Latin	America	and	APAC.

Our	segments	reflect	a	change,	effective	in	the	first	quarter	of	our	fiscal	year	2018,	to	reorganize	our	international	businesses	to	better	align	our	global	geographies.	We moved	 our	 Middle	 East	 and	 Africa	 businesses	 from	 the	 historical	AMEA	operating	 segment	 into	 the	 historical	 Europe	 reportable	 segment,	 forming	 the	 new EMEA	reportable	segment.	The	remaining	businesses	from	the	AMEA	operating	segment	became	the	APAC	operating	segment.	We	have	reflected	this	change	in	all historical	periods	presented.

See	Note	22,	Segment	Reporting,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	to	the	consolidated	financial	statements	for	our	financial	information	by segment.

# Items	Affecting	Comparability	of	Financial	Results

# Impairment	Losses:

Our	2018	results	reflect	goodwill	and	 intangible	asset	 impairment losses	of	$15.9	billion	 compared to	$49	million in	2017.	The increase	was	primarily	driven	by impairment	losses	of	$15.5	billion	recognized	in	the	fourth	quarter	of	2018.

As	we	determined	that	it	was	more	likely	than	not	that	the	fair	values	of	certain	reporting	units	or	brands	were	below	their	carrying	amounts,	we	performed	an	interim impairment	test	as	of	December	29,	2018.	As	a	result	of	our	interim	impairment	test,	we	recognized	goodwill	impairment	losses	of	$6.9	billion	and	indefinite-lived intangible	asset	impairment	losses	of	$8.6	billion	in	the	fourth	quarter	of	2018.

See	Critical	 Accounting	 Estimates	within this item	and	Note	10,	Goodwill	and	Intangible	Assets, in Item	 8,	Financial	Statements	and	Supplementary	Data, to the consolidated	financial	statements	for	additional	information.

# U.S.	Tax	Reform:

U.S.	Tax	Reform	legislation	enacted	by	the	federal	government	on	December	22,	2017	significantly	changed	U.S.	tax	laws	by,	among	other	things,	lowering	the	federal corporate	tax	rate	from	35.0%	to	21.0%,	effective	January	1,	2018	and	imposing	a	one-time	toll	charge	on	deemed	repatriated	earnings	of	foreign	subsidiaries	as	of December	30,	2017.	In	addition,	there	were	many	new	provisions,	including	changes	to	bonus	depreciation,	revised	deductions	for	executive	compensation	and	interest expense,	a	tax	on	global	intangible	low-taxed	income	("GILTI"),	the	base	erosion	anti-abuse	tax	("BEAT"),	and	a	deduction	for	foreign-derived	intangible	income ("FDII").	While	the	corporate	tax	rate	reduction	was	effective	January	1,	2018,	we	accounted	for	this	anticipated	rate	change	in	2017,	the	period	of	enactment.	As	a	result of	U.S.	Tax	Reform,	we	recorded	a	net	tax	benefit	of	approximately	$7.0	billion	in	2017.	As	a	result,	U.S.	Tax	Reform	significantly	impacted	our	provision	for/(benefit from)	income	taxes	and	our	effective	tax	rate,	primarily	in	2017,	resulting	in	a	lack	of	comparability	year	over	year.

See	Note	11,	Income	Taxes,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	additional	information.

# Integration	and	Restructuring	Expenses:

At	the	end	of	2017,	we	had	substantially	completed	our	multi-year	program	announced	following	the	2015	Merger	(the	"Integration	Program"),	which	was	designed	to reduce	costs	and	integrate	and	optimize	our	combined	organization.	As	of	December	29,	2018,	we	had	incurred	cumulative	pre-tax	costs	of	$2,146	million	related	to	the Integration	Program.	These	costs	primarily	included	severance	and	employee	benefit	costs	(including	cash	and	non-cash	severance),	costs	to	exit	facilities	(including	non- cash	costs	such	as	accelerated	depreciation),	and	other	costs	incurred	as	a	direct	result	of	integration	activities.	Approximately	60%	of	total	Integration	Program	costs were	cash	expenditures.	As	of	December	29,	2018,	we	had	incurred	approximately	$1.4	billion	in	capital	expenditures	related	to	the	Integration	Program	since	its inception	in	2015.

Related	to	our	restructuring	activities,	including	the	Integration	Program,	we	recognized	expenses	of	$460	million	in	2018,	$434	million in	2017,	and	$1.0	billion	in 2016.	Integration	Program	expenses	included	in	these	totals	were	$92	million	in	2018,	$316	million,	in	2017,	and	$887	million	in	2016.

See	Note	6,	Integration	and	Restructuring	Expenses,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	additional	information.

# Results	of	Operations

We	disclose	in	this	report	certain	non-GAAP	financial	measures.	These	non-GAAP	financial	measures	assist	management	in	comparing	our	performance	on	a	consistent basis	for	purposes	of	business	decision-making	by	removing	the	impact	of	certain	items	that	management	believes	do	not	directly	reflect	our	underlying	operations.	For additional	information	and	reconciliations	from	our	consolidated	financial	statements	see	Non-GAAP	Financial	Measures.

The	restatement	described	in	the	Overview	section	within	this	item	did	not	significantly	impact	the	drivers	of	our	consolidated	results	of	operations	or	our	results	of operations	by	segment.	See	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for additional	information.

In	addition,	during	the	period	between	December	29,	2018	and	the	filing	of	this	Annual	Report	on	Form	10-K,	certain	industry	trends	impacting	our	results	of	operations as	described	herein,	including	increased	costs	in	procurement	and	logistics,	pricing	pressure	as	a	result	of	increased	private	label	competition,	and	consumer	trends focused	on	health	and	wellness,	have	continued.

# Consolidated	Results	of	Operations

# Summary	of	Results:

|  |  | As	Restated	&amp;<br>Recast |  | As	Restated	&amp;	Recast | As	Restated	&amp;	Recast |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\n2018 | December\t30,\n2017 | %\tChange | December\t30,\n2017 | December\t31,\n2016 | %\tChange |
|  | (in\tmillions,\texcept\tper\tshare\tdata) | (in\tmillions,\texcept\tper\tshare\tdata) |  | (in\tmillions,\texcept\tper\tshare\tdata) | (in\tmillions,\texcept\tper\tshare\tdata) |  |
| Net\tsales | $26,268 | $26,076 | 0.7\t% | $26,076 | $26,300 | (0.9)% |
| Operating\tincome/(loss) | (10,220) | 6,057 | (268.7)% | 6,057 | 5,601 | 8.1\t% |
| Net\tincome/(loss)\tattributable\tto\tcommon\nshareholders | (10,192) | 10,941 | (193.2)% | 10,941 | 3,416 | 220.3\t% |
| Diluted\tEPS | (8.36) | 8.91 | (193.8)% | 8.91 | 2.78 | 220.5\t% |

# Net	Sales:

|  | As	Restated | As	Restated |  | As	Restated |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\n2018 | December\t30,\n2017 | %\tChange | December\t30,\n2017 | December\t31,\n2016 | %\tChange |
|  | (in\tmillions) |  |  | (in\tmillions) |  |  |
| Net\tsales | $26,268 | $26,076 | 0.7% | $26,076 | $26,300 | (0.9)% |
| Organic\tNet\tSales(a) | 26,105 | 25,876 | 0.9% | 25,963 | 26,188 | (0.9)% |

(a) Organic	Net	Sales	is	a	non-GAAP	financial	measure.	See	the	Non-GAAP	Financial	Measures	section	within	this	item.

Fiscal	Year	2018	Compared	to	Fiscal	Year	2017:

Net	sales	increased	0.7%	to	$26.3	billion	in	2018	compared	to	$26.1	billion	in	2017,	despite	the	unfavorable	impact	of	foreign	currency	(0.6	pp)	and	the	net	favorable impact	of	acquisitions	and	divestitures	(0.4	pp).	Organic	Net	Sales	 increased	0.9%	 to	$26.1	billion	 in	2018	compared	 to	$25.9	billion	 in	 2017	 driven	 by	favorable volume/mix	(0.9	pp).	Volume/mix	was	favorable	in	all	segments.	Pricing	was	flat,	with	lower	pricing	in	the	United	States	and	Canada	offset	by	higher	pricing	in	Rest	of World	(primarily	driven	by	highly	inflationary	environments	in	certain	markets	within	Latin	America)	and	EMEA.

Net	sales	decreased	0.9%	to	$26.1	billion	in	2017	compared	to	$26.3	billion	in	2016.	The	impacts	of	foreign	currency	and	acquisitions	and	divestitures	were	flat.	Organic Net	Sales	decreased	0.9%	to	$26.0	billion	in	2017	compared	to	$26.2	billion	in	2016	due	to	unfavorable	volume/mix	(1.5	pp),	partially	offset	by	higher	pricing	(0.6	pp). Volume/mix	was	unfavorable	in	the	United	States	and	Canada,	partially	offset	by	growth	in	Rest	of	World	and	EMEA.	Higher	pricing	in	Rest	of	World	and	the	United States	was	partially	offset	by	lower	pricing	in	Canada	and	EMEA.

# Net	Income:

# As	Restated	&

|  | As	Restated	&amp;<br>Recast | As	Restated	&amp;<br>Recast |  | As	Restated	&amp;	Recast | As	Restated	&amp;	Recast |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\n2018 | December\t30,\n2017 | %\tChange | December\t30,\n2017 | December\t31,\n2016 | %\tChange |
|  | (in\tmillions) |  |  | (in\tmillions) |  |  |
| Operating\tincome/(loss) | $(10,220) | $6,057 | (268.7)% | $6,057 | $5,601 | 8.1% |
| Net\tincome/(loss)\tattributable\tto\tcommon\nshareholders | (10,192) | 10,941 | (193.2)% | 10,941 | 3,416 | 220.3% |
| Adjusted\tEBITDA(a) | 7,024 | 7,664 | (8.3)% | 7,664 | 7,574 | 1.2% |

(a) Adjusted	EBITDA	is	a	non-GAAP	financial	measure.	See	the	Non-GAAP	Financial	Measures	section	within	this	item.

Operating	income/(loss)	decreased	268.7%	to	a	loss	of	$10.2	billion	in	2018	compared	to	income	of	$6.1	billion	in	2017.	This	decrease	was	primarily	due	to	higher impairment	 losses	 in	 2018.	 Impairment	 losses	 were	$15.9	billion	 in	 2018	 compared	 to	$49	 million	 in	 2017.	 The	 remaining	 $390	 million	 decrease	 in	 operating income/(loss)	was	due	to	higher	input	costs	and	strategic	investments.	These	decreases	to	operating	income/(loss)	were	partially	offset	by	lower	Integration	Program	and other	restructuring	expenses,	the	favorable	impact	of	foreign	currency	(4.2	pp),	the	benefit	from	the	postemployment	benefits	accounting	change	adopted	in	the	first quarter	of	2018,	savings	from	Integration	Program	and	other	restructuring	activities,	and	productivity	savings.	See	Note	10,	Goodwill	and	Intangible	Assets,	in	Item	8, Financial	Statements	and	Supplementary	Data,	for	additional	information	on	our	impairment	losses.

Net	income/(loss)	attributable	to	common	shareholders	decreased	193.2%	to	a	loss	of	$10.2	billion	in	2018	compared	to	income	of	$10.9	billion	in	2017.	The	decrease was	primarily	due	to	the	operating	income/(loss)	factors	described	above	(primarily	higher	impairment	losses	in	2018),	as	well	as	a	lower	tax	benefit,	unfavorable changes	in	other	expense/(income),	net,	and	higher	interest	expense,	which	are	detailed	as	follows:

•The	effective	tax	rate	was	a	benefit	of	9.4%	in	2018	on	a	pre-tax	loss	compared	to	a	benefit	of	100.6%	in	2017	on	pre-tax	income.	The	2018	effective	tax	rate was	 lower,	 primarily	 due	 to	 a	 decrease	 in	 the	 U.S.	 federal	 statutory	 rate,	 non-deductible	 items	 (including	 goodwill	 impairments,	 nonmonetary	 currency devaluation	losses,	and	the	wind-up	of	non-U.S.	pension	plans),	the	impact	of	the	federal	tax	on	GILTI,	and	the	revaluation	of	our	deferred	tax	balances	due	to changes	in	state	tax	laws	following	U.S.	Tax	Reform,	which	were	partially	offset	by	the	benefit	from	intangible	asset	impairment	losses	in	the	fourth	quarter	of 2018.	See	Note	11,	Income	Taxes,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	additional	information	related	to	our	effective	tax	rates.

•Other	expense/(income),	net	was	income	of	$183	million	in	2018	compared	to	income	of	$627	million	in	2017.	This	decrease	was	primarily	due	to	a	$162 million	non-cash	settlement	charge	in	2018	related	to	the	wind-up	of	our	Canadian	salaried	and	Canadian	hourly	defined	benefit	pension	plans	compared	to	a $177	million	non-cash	curtailment	gain	from	postretirement	plan	remeasurements	in	2017.	In	addition,	this	decrease	was	due	to	a	$146	million	nonmonetary currency	devaluation	loss	in	the	current	period	compared	to	a	$36	million	loss	in	the	prior	period	related	to	our	Venezuelan	operations.	See	Note	16,	Venezuela	- Foreign	Currency	and	Inflation,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	additional	information.

•Interest	expense	was	$1.3	billion	in	2018	compared	to	$1.2	billion	in	2017.	This	increase	was	primarily	driven	by	$3.0	billion	aggregate	principal	amount	of long-term	debt	issued	in	June	2018.	See	Note	19,	Debt,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	additional	information.

Adjusted	EBITDA	decreased	8.3%	to	$7.0	billion	in	2018	compared	to	$7.7	billion	in	2017,	primarily	due	to	higher	input	costs,	strategic	investments,	higher	overhead costs,	and	the	unfavorable	impact	of	foreign	currency	(0.5	pp),	partially	offset	by	savings	from	Integration	Program	and	other	restructuring	activities,	and	productivity savings.

Operating	income/(loss)	increased	8.1%	to	$6.1	billion	in	2017	compared	to	$5.6	billion	in	2016.	This	increase	was	primarily	driven	by	savings	from	the	Integration Program	and	other	restructuring	activities,	lower	Integration	Program	and	other	restructuring	expenses	in	2017,	and	lower	overhead	costs,	partially	offset	by	higher	input costs	in	local	currency,	lower	Organic	Net	Sales,	lower	unrealized	gains	on	commodity	hedges	in	2017,	and	the	unfavorable	impact	of	foreign	currency	(0.4	pp).

Net	income/(loss)	attributable	to	common	shareholders	increased	220.3%	to	$10.9	billion	in	2017	compared	to	$3.4	billion	in	2016.	The	increase	was	primarily	driven	by U.S.	Tax	Reform,	the	operating	income/(loss)	factors	discussed	above,	the	absence	of	the	Series	A	Preferred	Stock	dividend	in	2017,	and	favorable	changes	in	other expense/(income),	net,	partially	offset	by	higher	interest	expense,	detailed	as	follows:

•The	effective	tax	rate	was	a	100.6%	benefit	in	2017	compared	to	27.0%	expense	in	2016.	The	change	in	the	effective	tax	rate	was	primarily	driven	by	the	$7.0 billion	tax	benefit	from	U.S.	Tax	Reform,	lower	tax	benefits	associated	with	deferred	tax	effects	of	statutory	rate	changes,	and	taxes	on	income	of	foreign subsidiaries	in	2017.	See	Note	11,	Income	Taxes,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	additional	information	related	to	our	effective tax	rates.

•The	Series	A	Preferred	Stock	was	fully	redeemed	on	June	7,	2016.	Accordingly,	there	were	no	dividends	for	2017,	compared	to	$180	million	in	2016.	See Equity	and	Dividends	within	this	item	for	additional	information.

•Other	expense/(income),	net	was	$627	million	of	income	in	2017	compared	to	$472	million	of	income	in	2016.	This	increase	was	primarily	driven	by	a	$177 million	 non-cash	 curtailment	 gain	 from	 postretirement	 plan	 remeasurements	 in	 2017.	 This	 was	 partially	 offset	 by	 a	$36	 million	 nonmonetary	 currency devaluation	loss	in	2017	compared	to	$24	million	in	2016	related	to	our	Venezuelan	operations.	See	Note	16,	Venezuela	-	Foreign	Currency	and	Inflation,	in Item	8,	Financial	Statements	and	Supplementary	Data,	for	additional	information.

•Interest	expense	increased	to	$1.2	billion	in	2017	compared	to	$1.1	billion	in	2016.	This	increase	was	primarily	driven	by	the	May	2016	issuances	of	long-term debt	and	borrowings	under	our	commercial	paper	programs,	which	began	in	the	second	quarter	of	2016.

Adjusted	 EBITDA	increased	1.2%	 to	$7.7	billion	 in	 2017	 compared	 to	$7.6	billion	 in	2016,	primarily	driven	by	savings	from	 the	Integration	Program	and	other restructuring	activities	and	lower	overhead	costs,	partially	offset	by	higher	input	costs	in	local	currency,	the	unfavorable	impact	of	foreign	currency	(0.2	pp),	and	a decline	in	Organic	Net	Sales.

# Diluted	EPS:

|  |  | As	Restated |  | As	Restated |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\n2018 | December\t30,\n2017 | %\tChange | December\t30,\n2017 | December\t31,\n2016 | %\tChange |
|  | (in\tmillions,\texcept\tper\tshare\tdata) | (in\tmillions,\texcept\tper\tshare\tdata) |  | (in\tmillions,\texcept\tper\tshare\tdata) | (in\tmillions,\texcept\tper\tshare\tdata) |  |
| Diluted\tEPS | $(8.36) | $8.91 | (193.8)% | $8.91 | $2.78 | 220.5% |
| Adjusted\tEPS(a) | 3.51 | 3.50 | 0.3\t% | 3.50 | 3.31 | 5.7% |

(a) Adjusted	EPS	is	a	non-GAAP	financial	measure.	See	the	Non-GAAP	Financial	Measures	section	within	this	item.

Diluted	 EPS	decreased	193.8%	 to	 a loss	 of	$8.36 in	 2018	 compared to	 earnings	 of	$8.91 in	2017,	primarily	due to the	net income/(loss)	attributable to	common shareholders	factors	discussed	above.

|  | December	29,<br>2018 | December	30,<br>2017 | $	Change | %	Change |
| :--- | :--- | :--- | :--- | :--- |
| Diluted\tEPS | $(8.36) | $8.91 | $(17.27) | (193.8)% |
| Integration\tand\trestructuring\texpenses | 0.32 | 0.24 | 0.08 |  |
| Deal\tcosts | 0.02 | — | 0.02 |  |
| Unrealized\tlosses/(gains)\ton\tcommodity\thedges | 0.01 | 0.01 | — |  |
| Impairment\tlosses | 11.28 | 0.03 | 11.25 |  |
| Losses/(gains)\ton\tsale\tof\tbusiness | 0.01 | — | 0.01 |  |
| Other\tlosses/(gains)\trelated\tto\tacquisitions\tand\tdivestitures | 0.02 | — | 0.02 |  |
| Nonmonetary\tcurrency\tdevaluation | 0.12 | 0.03 | 0.09 |  |
| U.S.\tTax\tReform\tdiscrete\tincome\ttax\texpense/(benefit) | 0.09 | (5.72) | 5.81 |  |
| Adjusted\tEPS(a) | $3.51 | $3.50 | $0.01 | 0.3\t% |
| Key\tdrivers\tof\tchange\tin\tAdjusted\tEPS(a): |  |  |  |  |
| Results\tof\toperations |  |  | $(0.37) |  |
| Change\tin\tinterest\texpense |  |  | (0.03) |  |
| Change\tin\teffective\ttax\trate |  |  | 0.39 |  |
| Effect\tof\tdilutive\tequity\tawards |  |  | 0.02 |  |

(a) Adjusted	EPS	is	a	non-GAAP	financial	measure.	See	the	Non-GAAP	Financial	Measures	section	at	the	end	of	this	item.

Adjusted	EPS	 increased	0.3%	 to	$3.51	 in	2018	compared	 to	$3.50	in	2017,	driven	by	lower	taxes	on	adjusted	earnings	in	the	current	period,	the	benefit	from	the postemployment	benefits	accounting	change	adopted	in	the	first	quarter	of	2018,	and	the	effect	of	dilutive	equity	awards,	partially	offset	by	lower	Adjusted	EBITDA, higher	interest	expense,	and	higher	depreciation	and	amortization	in	the	current	period.	We	have	excluded	the	effect	of	dilutive	equity	awards	in	2018	as	their	inclusion would	have	had	an	anti-dilutive	effect	on	EPS	because	of	the	net	loss	attributable	to	common	shareholders.	In	2017,	the	effect	of	dilutive	equity	awards	was	included.

Diluted	 EPS	increased	220.5% to	$8.91 in	2017	compared to	$2.78	in	2016,	primarily	driven	by	the	net	income/(loss)	attributable	to	common	shareholders	factors discussed	above.

Adjusted	EPS	increased	5.7%	to	$3.50	in	2017	compared	to	$3.31	in	2016,	primarily	driven	by	the	absence	of	Series	A	Preferred	Stock	dividends	in	2017	and	Adjusted EBITDA	growth	despite	the	unfavorable	impact	of	foreign	currency,	partially	offset	by	higher	interest	expense.

# Results	of	Operations	by	Segment

Management	evaluates	segment	performance	based	on	several	factors,	 including	net	sales,	Organic	Net	Sales,	and	segment	adjusted	earnings	before	 interest,	 tax, depreciation,	and	amortization	("Segment	Adjusted	EBITDA").	Segment	Adjusted	EBITDA	is	defined	as	net	income/(loss)	from	continuing	operations	before	interest expense,	other	expense/(income),	net,	provision	for/(benefit	from)	income	taxes,	and	depreciation	and	amortization	(excluding	integration	and	restructuring	expenses);	in addition	to	these	adjustments,	we	exclude,	when	they	occur,	the	impacts	of	integration	and	restructuring	expenses,	deal	costs,	unrealized	gains/(losses)	on	commodity hedges	(the	unrealized	gains	and	losses	are	recorded	in	general	corporate	expenses	until	realized;	once	realized,	the	gains	and	losses	are	recorded	in	the	applicable segment's	operating	results),	impairment	losses,	gains/(losses)	on	the	sale	of	a	business,	other	gains/(losses)	related	to	acquisitions	and	divestitures	(e.g.,	tax	and	hedging impacts),	nonmonetary	currency	devaluation	(e.g.,	remeasurement	gains	and	losses),	and	equity	award	compensation	expense	(excluding	integration	and	restructuring expenses).	Segment	Adjusted	EBITDA	is	a	tool	that	can	assist	management	and	investors	in	comparing	our	performance	on	a	consistent	basis	by	removing	the	impact	of certain	items	that	management	believes	do	not	directly	reflect	our	underlying	operations.

Under	highly	inflationary	accounting,	the	functional	currency	of	our	Venezuelan	subsidiary	is	the	U.S.	dollar.	As	a	result,	we	must	revalue	the	results	of	our	Venezuelan subsidiary	to	U.S.	dollars.	We	revalue	the	income	statement	using	daily	weighted	average	Sistema	de	Divisa	Complementaria	("DICOM")	rates,	and	we	revalue	the bolivar	denominated	monetary	assets	and	liabilities	at	the	period-end	DICOM	spot	rate.	The	resulting	revaluation	gains	and	losses	are	recorded	in	current	net	income	and are	classified	within	other	expense/(income),	net	as	nonmonetary	currency	devaluation.	See	Note	16,	Venezuela	-	Foreign	Currency	and	Inflation,	in	Item	8,	Financial Statements	and	Supplementary	Data,	for	additional	information.

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
|  |  | (in\tmillions) |  |
| Net\tsales: |  |  |  |
| United\tStates | $18,122 | $18,230 | $18,469 |
| Canada | 2,173 | 2,177 | 2,302 |
| EMEA | 2,718 | 2,585 | 2,586 |
| Rest\tof\tWorld | 3,255 | 3,084 | 2,943 |
| Total\tnet\tsales | $26,268 | $26,076 | $26,300 |

# Organic	Net	Sales:

|  | 2018	Compared	to	2017 | 2017	Compared	to	2016 | 2017	Compared	to	2016 | 2017	Compared	to	2016 |
| :--- | :--- | :--- | :--- | :--- |
|  |  |  | As\tRestated |  |
|  | December\t29,\n2018 | December\t30,\n2017 | December\t30,\n2017 | December\t31,\n2016 |
|  |  | (in\tmillions) | (in\tmillions) |  |
| Organic\tNet\tSales(a): |  |  |  |  |
| United\tStates | $18,122 | $18,230 | $18,230 | $18,469 |
| Canada | 2,178 | 2,177 | 2,135 | 2,302 |
| EMEA | 2,633 | 2,529 | 2,549 | 2,529 |
| Rest\tof\tWorld | 3,172 | 2,940 | 3,049 | 2,888 |
| Total\tOrganic\tNet\tSales | $26,105 | $25,876 | $25,963 | $26,188 |

Drivers	of	the	changes	in	net	sales	and	Organic	Net	Sales	were:

|  | Net	Sales | Currency | Acquisitions	and<br>Divestitures | Organic	Net	Sales | Price | Volume/Mix |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| 2018\tCompared\tto\t2017 |  |  |  |  |  |  |
| United\tStates | (0.6)% | 0.0\tpp | 0.0\tpp | (0.6)% | (0.9)\tpp | 0.3\tpp |
| Canada | (0.2)% | (0.3)\tpp | 0.0\tpp | 0.1\t% | (0.6)\tpp | 0.7\tpp |
| EMEA | 5.1\t% | 2.5\tpp | (1.5)\tpp | 4.1\t% | 0.9\tpp | 3.2\tpp |
| Rest\tof\tWorld | 5.6\t% | (7.6)\tpp | 5.3\tpp | 7.9\t% | 5.4\tpp | 2.5\tpp |
| Kraft\tHeinz | 0.7\t% | (0.6)\tpp | 0.4\tpp | 0.9\t% | 0.0\tpp | 0.9\tpp |
| 2017\tCompared\tto\t2016\t(As\tRestated) |  |  |  |  |  |  |
| United\tStates | (1.3)% | 0.0\tpp | 0.0\tpp | (1.3)% | 0.5\tpp | (1.8)\tpp |
| Canada | (5.4)% | 1.9\tpp | 0.0\tpp | (7.3)% | (1.8)\tpp | (5.5)\tpp |
| EMEA | —\t% | (0.5)\tpp | (0.3)\tpp | 0.8\t% | (0.5)\tpp | 1.3\tpp |
| Rest\tof\tWorld | 4.8\t% | (0.8)\tpp | 0.0\tpp | 5.6\t% | 4.2\tpp | 1.4\tpp |
| Kraft\tHeinz | (0.9)% | 0.0\tpp | 0.0\tpp | (0.9)% | 0.6\tpp | (1.5)\tpp |

# Adjusted	EBITDA:

|  |  | As	Restated	&amp;	Recast |  |
| :--- | :--- | :--- | :--- |
|  | December\t29,\n2018 | December\t30,\n2017 | December\t31,\n2016 |
|  |  | (in\tmillions) |  |
| Segment\tAdjusted\tEBITDA: |  |  |  |
| United\tStates | $5,218 | $5,873 | $5,744 |
| Canada | 608 | 636 | 632 |
| EMEA | 724 | 673 | 741 |
| Rest\tof\tWorld | 635 | 590 | 621 |
| General\tcorporate\texpenses | (161) | (108) | (164) |
| Depreciation\tand\tamortization\t(excluding\tintegration\tand\trestructuring\texpenses) | (919) | (907) | (875) |
| Integration\tand\trestructuring\texpenses | (297) | (583) | (992) |
| Deal\tcosts | (23) | — | (30) |
| Unrealized\tgains/(losses)\ton\tcommodity\thedges | (21) | (19) | 38 |
| Impairment\tlosses | (15,936) | (49) | (71) |
| Gains/(losses)\ton\tsale\tof\tbusiness | (15) | — | — |
| Nonmonetary\tcurrency\tdevaluation | — | — | (4) |
| Equity\taward\tcompensation\texpense\t(excluding\tintegration\tand\trestructuring\texpenses) | (33) | (49) | (39) |
| Operating\tincome/(loss) | (10,220) | 6,057 | 5,601 |
| Interest\texpense | 1,284 | 1,234 | 1,134 |
| Other\texpense/(income),\tnet | (183) | (627) | (472) |
| Income/(loss)\tbefore\tincome\ttaxes | $(11,321) | $5,450 | $4,939 |

|  | 2018	Compared	to	2017 | 2018	Compared	to	2017 |  | 2017	Compared	to	2016 | 2017	Compared	to	2016 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | As\tRestated\t&amp;\nRecast | As\tRestated\t&amp;\nRecast |  | As\tRestated\t&amp;\tRecast | As\tRestated\t&amp;\tRecast |  |
|  | December\t29,\n2018 | December\t30,\n2017 | %\tChange | December\t30,\n2017 | December\t31,\n2016 | %\tChange |
|  | (in\tmillions) | (in\tmillions) |  | (in\tmillions) | (in\tmillions) |  |
| Net\tsales | $18,122 | $18,230 | (0.6)% | $18,230 | $18,469 | (1.3)% |
| Organic\tNet\tSales(a) | 18,122 | 18,230 | (0.6)% | 18,230 | 18,469 | (1.3)% |
| Segment\tAdjusted\tEBITDA | 5,218 | 5,873 | (11.2)% | 5,873 | 5,744 | 2.2\t% |

Net	sales	and	Organic	Net	Sales	decreased	0.6%	to	$18.1	billion	in	2018	compared	to	$18.2	billion	in	2017	primarily	due	to	lower	pricing	(0.9	pp),	partially	offset	by favorable	volume/mix	(0.3	pp).	Pricing	was	lower	across	most	categories,	particularly	in	ready-to-drink	beverages,	cheese,	and	meat,	partially	offset	by	increases	in boxed	dinners	and	condiments	and	sauces.	Favorable	volume/mix	across	several	categories,	particularly	in	ready-to-drink	beverages,	was	partially	offset	by	lower shipments	in	cheese.

Segment	Adjusted	EBITDA	decreased	11.2%	to	$5.2	billion	in	2018	compared	to	$5.9	billion	in	2017	primarily	due	to	non-key	commodity	cost	inflation,	lower	Organic Net	Sales,	strategic	investments,	and	higher	overhead	costs,	partially	offset	by	favorable	key	commodity	costs,	and	Integration	Program	savings.

Net	sales	and	Organic	Net	Sales	decreased	1.3%	to	$18.2	billion	in	2018	compared	to	$18.5	billion	in	2017	due	to	unfavorable	volume/mix	(1.8	pp),	partially	offset	by higher	pricing	(0.5	pp).	Unfavorable	volume/mix	was	primarily	driven	by	distribution	losses	in	nuts,	cheese,	and	meat,	and	lower	shipments	in	foodservice.	The	decline was	partially	offset	by	gains	in	refrigerated	meal	combinations,	boxed	dinners,	and	frozen	meals.	Pricing	was	higher	driven	primarily	by	price	increases	in	cheese.

Segment	Adjusted	EBITDA	increased	2.2%	to	$5.9	billion	in	2017	compared	to	$5.7	billion	in	2016	primarily	driven	by	Integration	Program	savings	and	lower	overhead costs,	partially	offset	by	unfavorable	key	commodity	costs,	primarily	in	dairy,	meat,	and	coffee,	as	well	as	unfavorable	volume/mix.

# Canada:

|  | 2018	Compared	to	2017 | 2018	Compared	to	2017 |  | 2017	Compared	to	2016 | 2017	Compared	to	2016 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | As\tRestated\t&amp;\nRecast | As\tRestated\t&amp;\nRecast |  | As\tRestated\t&amp;\tRecast | As\tRestated\t&amp;\tRecast |  |
|  | December\t29,\n2018 | December\t30,\n2017 | %\tChange | December\t30,\n2017 | December\t31,\n2016 | %\tChange |
|  | (in\tmillions) | (in\tmillions) |  | (in\tmillions) | (in\tmillions) |  |
| Net\tsales | $2,173 | $2,177 | (0.2)% | $2,177 | $2,302 | (5.4)% |
| Organic\tNet\tSales(a) | 2,178 | 2,177 | 0.1\t% | 2,135 | 2,302 | (7.3)% |
| Segment\tAdjusted\tEBITDA | 608 | 636 | (4.4)% | 636 | 632 | 0.7\t% |

Net	sales	decreased	0.2%	to	$2.2	billion	in	2018	compared	to	$2.2	billion	in	2017	due	to	the	unfavorable	impact	of	foreign	currency	(0.3	pp).	Organic	Net	Sales	increased 0.1%	to	$2.2	billion	in	2018	compared	to	$2.2	billion	in	2017	driven	by	favorable	volume/mix	(0.7	pp),	partially	offset	by	lower	pricing	(0.6	pp).	Favorable	volume/mix was	primarily	driven	by	higher	shipments	in	cheese	and	coffee,	primarily	due	to	earlier	execution	of	go-to-market	agreements	with	key	retailers,	partially	offset	by	lower shipments	in	condiments	and	sauces.	Lower	pricing	in	cheese	was	partially	offset	by	increases	across	a	number	of	categories,	particularly	in	foodservice.

Segment	Adjusted	EBITDA	decreased	4.4%	to	$608	million	in	2018	compared	to	$636	million	in	2017,	partially	due	to	the	unfavorable	impact	of	foreign	currency	(0.3 pp).	Excluding	the	currency	impact,	Segment	Adjusted	EBITDA	decreased	primarily	due	to	lower	pricing,	higher	overhead	costs,	and	higher	input	costs	in	local currency.

Net	sales	decreased	5.4%	to	$2.2	billion	in	2017	compared	to	$2.3	billion	in	2016,	despite	the	favorable	impact	of	foreign	currency	(1.9	pp).	Organic	Net	Sales	decreased 7.3%	to	$2.1	billion	in	2017	compared	to	$2.3	billion	in	2016	due	to	unfavorable	volume/mix	(5.5	pp)	and	lower	pricing	(1.8	pp).	Volume/mix	was	unfavorable	across several	categories	and	was	most	pronounced	in	cheese,	coffee,	and	boxed	dinners,	primarily	due	to	delayed	execution	of	go-to-market	agreements	with	key	retailers, retail	distribution	losses	(primarily	in	cheese),	and	lower	inventory	levels	at	retail	versus	the	prior	year.	Lower	pricing	was	due	to	higher	promotional	activity,	primarily in	cheese.

Segment	Adjusted	 EBITDA	 increased	0.7%	 to	$636	million	 in	2017	compared	 to	$632	million	 in	2016,	despite	 the	favorable	impact	of	foreign	currency	(1.7	 pp). Excluding	the	currency	impact,	Segment	Adjusted	EBITDA	decreased	primarily	due	to	lower	Organic	Net	Sales	partially	offset	by	Integration	Program	savings	and lower	overhead	costs	in	2017.

# EMEA:

|  | 2018	Compared	to	2017 | 2018	Compared	to	2017 |  | 2017	Compared	to	2016 | 2017	Compared	to	2016 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | As\tRestated\t&amp;\nRecast | As\tRestated\t&amp;\nRecast |  | As\tRestated\t&amp;\tRecast | As\tRestated\t&amp;\tRecast |  |
|  | December\t29,\n2018 | December\t30,\n2017 | %\tChange | December\t30,\n2017 | December\t31,\n2016 | %\tChange |
|  | (in\tmillions) |  |  | (in\tmillions) |  |  |
| Net\tsales | $2,718 | $2,585 | 5.1% | $2,585 | $2,586 | —\t% |
| Organic\tNet\tSales(a) | 2,633 | 2,529 | 4.1% | 2,549 | 2,529 | 0.8\t% |
| Segment\tAdjusted\tEBITDA | 724 | 673 | 7.6% | 673 | 741 | (9.3)% |

Net	sales	increased	5.1%	to	$2.7	billion	in	2018	compared	to	$2.6	billion	in	2017	driven	by	the	favorable	impact	of	foreign	currency	(2.5	pp),	partially	offset	by	the unfavorable	impact	of	acquisitions	and	divestitures	(1.5	pp).	 Organic	 Net	 Sales	increased	4.1%	 to	$2.6	billion	 in	2018	compared	 to	$2.5	billion	in	2017	driven	by favorable	volume/mix	(3.2	pp)	and	higher	pricing	(0.9	pp).	Favorable	volume/mix	was	primarily	driven	by	growth	in	condiments	and	sauces,	including	the	addition	of Kraft	products	in	certain	regions,	and	gains	in	foodservice.	Pricing	was	higher,	primarily	driven	by	higher	pricing	in	Middle	East	and	Africa,	and	favorable	timing	of promotional	activity	versus	the	prior	year	in	the	UK,	partially	offset	by	lower	pricing	in	eastern	Europe.

Segment	Adjusted	EBITDA	increased	7.6%	 to	$724	million	in	2018	compared	to	$673	million	in	2017,	including	the	favorable	impact	of	foreign	currency	(3.2	pp). Excluding	the	currency	impact,	the	increase	was	primarily	driven	by	Organic	Net	Sales	growth,	productivity	savings,	and	the	benefit	from	the	postemployment	benefits accounting	change	adopted	in	the	first	quarter	of	2018,	partially	offset	by	higher	supply	chain	costs	in	the	Middle	East	and	Africa.

Net	sales	were	flat	at	$2.6	billion	in	2017	and	in	2016,	despite	the	unfavorable	impacts	of	foreign	currency	(0.5	pp)	and	acquisitions	and	divestitures	(0.3	pp).	Organic Net	Sales	increased	0.8%	to	$2.5	billion	in	2017	compared	to	$2.5	billion	in	2016	driven	by	favorable	volume/mix	(1.3	pp),	partially	offset	by	lower	pricing	(0.5	pp). Favorable	volume/mix	was	primarily	driven	by	higher	shipments	in	foodservice	and	growth	in	condiments	and	sauces,	partially	offset	by	ongoing	declines	in	infant nutrition	in	Italy.	Pricing	was	lower,	primarily	driven	by	higher	promotional	activity	in	the	UK	and	Italy	versus	the	prior	period,	partially	offset	by	higher	pricing	in	the Middle	East	and	Africa.

Segment	Adjusted	EBITDA	decreased	9.3%	to	$673	million	in	2017	compared	to	$741	million	in	2016,	including	the	unfavorable	impact	of	foreign	currency	(1.4	pp). Excluding	the	currency	impact,	the	decrease	was	due	to	higher	input	costs	in	local	currency,	partially	offset	by	productivity	savings.

# Rest	of	World:

|  | 2018	Compared	to	2017 | 2018	Compared	to	2017 |  | 2017	Compared	to	2016 | 2017	Compared	to	2016 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | As\tRestated\t&amp;\nRecast | As\tRestated\t&amp;\nRecast |  | As\tRestated\t&amp;\tRecast | As\tRestated\t&amp;\tRecast |  |
|  | December\t29,\n2018 | December\t30,\n2017 | %\tChange | December\t30,\n2017 | December\t31,\n2016 | %\tChange |
|  | (in\tmillions) |  |  | (in\tmillions) |  |  |
| Net\tsales | $3,255 | $3,084 | 5.6% | $3,084 | $2,943 | 4.8\t% |
| Organic\tNet\tSales(a) | 3,172 | 2,940 | 7.9% | 3,049 | 2,888 | 5.6\t% |
| Segment\tAdjusted\tEBITDA | 635 | 590 | 7.5% | 590 | 621 | (5.0)% |

Net	sales	increased	5.6%	to	$3.3	billion	in	2018	compared	to	$3.1	billion	in	2017,	despite	the	unfavorable	impact	of	foreign	currency	(7.6	pp,	including	5.1	pp	from	the devaluation	of	the	Venezuelan	bolivar),	which	more	than	offset	the	favorable	impact	of	acquisitions	and	divestitures	(5.3	pp).	Organic	Net	Sales	increased	7.9%	to	$3.2 billion	in	2018	compared	to	$2.9	billion	in	2017	driven	by	higher	pricing	(5.4	pp)	 and	favorable	volume/mix	(2.5	pp).	Pricing	was	higher	primarily	driven	by	highly inflationary	environments	in	certain	markets	within	Latin	America.	Favorable	volume/mix	was	driven	by	growth	across	several	categories,	which	was	most	pronounced in	condiments	and	sauces,	partially	offset	by	lower	shipments	in	Southeast	Asia.

Segment	Adjusted	EBITDA	increased	7.5%	to	$635	million	in	2018	compared	to	$590	million	in	2017,	despite	the	unfavorable	impact	of	foreign	currency	(12.7	pp, including	11.4	pp	from	the	devaluation	of	the	Venezuelan	bolivar).	Excluding	the	currency	impact,	the	increase	in	Segment	Adjusted	EBITDA	was	primarily	driven	by Organic	Net	Sales	growth,	partially	offset	by	higher	input	costs	in	local	currency.

Net	sales	increased	4.8%	to	$3.1	billion	in	2017	compared	to	$2.9	billion	in	2016,	despite	the	unfavorable	impact	of	foreign	currency	(0.8	pp,	including	2.0	pp	from	the devaluation	of	the	Venezuelan	bolivar).	Organic	Net	Sales	increased	5.6%	to	$3.0	billion	in	2017	compared	to	$2.9	billion	in	2016	driven	by	higher	pricing	(4.2	pp)	and favorable	volume/mix	(1.4	pp).	Higher	pricing	was	primarily	driven	by	pricing	actions	taken	to	offset	higher	input	costs	in	local	currency,	primarily	in	Latin	America. Favorable	volume/mix	was	primarily	driven	by	growth	in	condiments	and	sauces	across	all	regions	partially	offset	by	volume/mix	declines	in	several	markets	associated with	distributor	network	re-alignment.

Segment	Adjusted	EBITDA	decreased	5.0%	to	$590	million	in	2017	compared	to	$621	million	in	2016,	including	the	unfavorable	impact	of	foreign	currency	(2.9	pp, including	3.5	pp	from	the	devaluation	of	the	Venezuelan	bolivar).	Excluding	the	currency	impact,	Segment	Adjusted	EBITDA	decreased	primarily	due	to	higher	input costs	in	local	currency	and	higher	commercial	investments,	partially	offset	by	Organic	Net	Sales	growth.

# Critical	Accounting	Estimates

Note	3,	Significant	Accounting	Policies,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	includes	a	summary	of	the	significant	accounting	policies	we	used	to prepare	our	consolidated	financial	statements.	The	following	is	a	review	of	the	more	significant	assumptions	and	estimates	as	well	as	accounting	policies	we	used	to prepare	our	consolidated	financial	statements.

# Revenue	Recognition:

Our	revenues	are	primarily	derived	from	customer	orders	for	the	purchase	of	our	products.	We	recognize	revenues	as	performance	obligations	are	fulfilled	when	control passes	to	our	customers.	We	record	revenues	net	of	variable	consideration,	including	consumer	incentives	and	performance	obligations	related	to	trade	promotions, excluding	taxes,	and	including	all	shipping	and	handling	charges	billed	to	customers	(accounting	for	shipping	and	handling	charges	that	occur	after	the	transfer	of	control as	fulfillment	costs).	We	also	record	a	refund	liability	for	estimated	product	returns	and	customer	allowances	as	reductions	to	revenues	within	the	same	period	that	the revenue	is	recognized.	We	base	these	estimates	principally	on	historical	and	current	period	experience	factors.	We	recognize	costs	paid	to	third	party	brokers	to	obtain contracts	as	expenses	as	our	contracts	are	generally	less	than	one	year.

# Advertising,	Consumer	Incentives,	and	Trade	Promotions:

We	promote	our	products	with	advertising,	consumer	incentives,	and	performance	obligations	related	to	trade	promotions.	Consumer	incentives	and	trade	promotions include,	but	are	not	limited	to,	discounts,	coupons,	rebates,	performance-based	in-store	display	activities,	and	volume-based	incentives.	Variable	consideration	related	to consumer	incentive	and	trade	promotion	activities	is	recorded	as	a	reduction	to	revenues	based	on	amounts	estimated	as	being	due	to	customers	and	consumers	at	the	end of	a	period.	We	base	these	estimates	principally	on	historical	utilization,	redemption	rates,	and/or	current	period	experience	factors.	We	review	and	adjust	these	estimates at	least	quarterly	based	on	actual	experience	and	other	information.

Advertising	expenses	are	recorded	in	selling,	general	and	administrative	expenses	("SG&A").	For	interim	reporting	purposes,	we	charge	advertising	to	operations	as	a percentage	of	estimated	full	year	sales	activity	and	marketing	costs.	We	review	and	adjust	these	estimates	each	quarter	based	on	actual	experience	and	other	information. We	recorded	advertising	expenses	of	$584	million	in	2018,	$629	million	in	2017,	and	$708	million	in	2016,	which	represented	costs	to	obtain	physical	advertisement spots	in	television,	radio,	print,	digital,	and	social	channels.	The	decrease	in	advertising	expenses	in	2018	compared	to	2017	was	driven	by	a	shift	from	traditional	ad spaces	to	non-traditional	ad	spaces.	We	also	incur	other	advertising	and	marketing	costs	such	as	shopper	marketing,	sponsorships,	and	agency	advertisement	conception, design,	and	public	relations	fees.	Total	advertising	and	marketing	costs	were	$1,140	million	in	2018,	$1,115	million	in	2017,	and	$1,221	million	in	2016.

# Goodwill	and	Intangible	Assets:

Our	goodwill	balance	consists	of	20	reporting	units	and	had	an	aggregate	carrying	amount	of	$36.5	billion	as	of	December	29,	2018.	Our	indefinite-lived	intangible	asset balance	primarily	consists	of	a	number	of	individual	brands,	which	had	an	aggregate	carrying	amount	of	$44.0	billion	as	of	December	29,	2018.

We	test	our	reporting	units	and	brands	for	impairment	annually	as	of	the	first	day	of	our	second	quarter,	or	more	frequently	if	events	or	circumstances	indicate	it	is	more likely	than	not	that	the	fair	value	of	a	reporting	unit	or	brand	is	less	than	its	carrying	amount.	Such	events	and	circumstances	could	include	a	sustained	decrease	in	our market	capitalization,	increased	competition	or	unexpected	loss	of	market	share,	increased	input	costs	beyond	projections	(for	example	due	to	regulatory	or	industry changes),	disposals	of	significant	brands	or	components	of	our	business,	unexpected	business	disruptions	(for	example	due	to	a	natural	disaster	or	loss	of	a	customer, supplier,	or	other	significant	business	relationship),	unexpected	significant	declines	in	operating	results,	or	significant	adverse	changes	in	the	markets	in	which	we operate.	We	test	reporting	units	for	impairment	by	comparing	the	estimated	fair	value	of	each	reporting	unit	with	its	carrying	amount.	We	test	brands	for	impairment	by comparing	the	estimated	fair	value	of	each	brand	with	its	carrying	amount.	If	the	carrying	amount	of	a	reporting	unit	or	brand	exceeds	its	estimated	fair	value,	we	record an	impairment	loss	based	on	the	difference	between	fair	value	and	carrying	amount,	in	the	case	of	reporting	units,	not	to	exceed	to	the	associated	carrying	amount	of goodwill.

Fair	value	determinations	require	considerable	judgment	and	are	sensitive	to	changes	in	underlying	assumptions,	estimates,	and	market	factors.	Estimating	the	fair	value of	 individual	reporting	 units	 and	 brands	requires	us	to	make	assumptions	and	estimates	regarding	our	future	plans,	as	well	as	industry,	economic,	and	regulatory conditions.	These	assumptions	and	estimates	include	estimated	future	annual	net	cash	flows,	income	tax	considerations,	discount	rates,	growth	rates,	royalty	rates, contributory	asset	charges,	and	other	market	factors.	If	current	expectations	of	future	growth	rates	and	margins	are	not	met,	if	market	factors	outside	of	our	control,	such as	discount	rates,	change,	or	if	management's	expectations	or	plans	otherwise	change,	including	as	a	result	of	the	development	of	our	global	five-year	operating	plan, then	one	or	more	of	our	reporting	units	or	brands	might	become	impaired	in	the	future.	As	detailed	in	Note	10,	Goodwill	and	Intangible	Assets,	 in	Item	8,	Financial Statements	and	Supplementary	Data,	we	recorded	impairment	losses	totaling	$15.9	billion	for	the	year	ended	December	29,	2018.	 Our	reporting	units	and	brands	that were	impaired	in	2018	were	written	down	to	their	respective	fair	values	resulting	in	zero	excess	fair	value	over	carrying	amount	as	of	their	latest	2018	impairment	testing dates.	Accordingly,	these	and	other	individual	reporting	units	and	brands	that	have	20%	or	less	excess	fair	value	over	carrying	amount	as	of	their	latest	testing	date	have	a heightened	risk	of	future	impairments	if	any	assumptions,	estimates,	or	market	factors	change	in	the	future.	Reporting	units	with	a	heightened	risk	of	future	impairments had	an	aggregate	goodwill	carrying	amount	of	$29.0	billion	at	December	29,	2018	and	included:	U.S.	Grocery,	U.S.	Refrigerated,	Canada	Retail,	Latin	America	Exports, Southeast	Europe,	Australia	and	New	Zealand,	and	Northeast	Asia.	Of	 the	$29.0	billion	with	a	heightened	risk	of	future	impairments,	$9.3	billion	is	attributable	to reporting	units	with	0%	excess	fair	value	over	carrying	amount.	Brands	with	a	heightened	risk	of	future	impairments	had	an	aggregate	carrying	amount	of	$29.3	billion	at December	29,	2018	and	included:	Kraft,	Philadelphia,	Oscar	Mayer,	Velveeta,	Miracle	Whip,	Planters,	A1,	Cool	Whip,	Stove	Top,	ABC,	and	Quero.	Of	the	$29.3	billion with	a	heightened	risk	of	future	impairments,	$24.0	billion	is	attributable	to	brands	with	0%	excess	fair	value	over	carrying	amount.	Although	the	remaining	reporting units	and	brands	have	more	than	20%	excess	fair	value	over	carrying	amount	as	of	their	latest	2018	impairment	testing	date,	these	amounts	are	also	associated	with	the 2013	Heinz	acquisition	and	the	2015	Merger	and	are	recorded	on	the	balance	sheet	at	their	estimated	acquisition	date	fair	values.	Therefore,	if	any	assumptions, estimates,	or	market	factors	change	in	the	future,	these	amounts	are	also	susceptible	to	impairments.

We	generally	utilize	the	discounted	cash	flow	method	under	the	income	approach	to	estimate	the	fair	value	of	our	reporting	units.	Some	of	the	more	significant assumptions	inherent	in	estimating	the	fair	values	include	the	estimated	future	annual	net	cash	flows	for	each	reporting	unit	(including	net	sales,	cost	of	products	sold, SG&A,	depreciation	and	amortization,	working	capital,	and	capital	expenditures),	income	tax	rates,	long-term	growth	rates,	and	a	discount	rate	that	appropriately	reflects the	risks	inherent	in	each	future	cash	flow	stream.	We	selected	the	assumptions	used	in	the	financial	forecasts	using	historical	data,	supplemented	by	current	and anticipated	market	conditions,	estimated	product	category	growth	rates,	management's	plans,	and	guideline	companies.

We	generally	utilize	the	excess	earnings	method	under	the	income	approach	to	estimate	the	fair	value	of	certain	of	our	largest	brands.	Some	of	the	more	significant assumptions	inherent	in	estimating	the	fair	values	include	the	estimated	future	annual	net	cash	flows	for	each	brand	(including	net	sales,	cost	of	products	sold,	and SG&A),	contributory	asset	charges,	income	tax	considerations,	long-term	growth	rates,	a	discount	rate	that	reflects	the	level	of	risk	associated	with	the	future	earnings attributable	to	the	brand,	and	management's	intent	to	invest	in	the	brand	indefinitely.	We	selected	the	assumptions	used	in	the	financial	forecasts	using	historical	data, supplemented	by	current	and	anticipated	market	conditions,	estimated	product	category	growth	rates,	management's	plans,	and	guideline	companies.

We	generally	utilize	the	relief	from	royalty	method	under	the	income	approach	to	estimate	the	fair	value	of	our	remaining	brands.	Some	of	the	more	significant assumptions	inherent	in	estimating	the	fair	values	include	the	estimated	future	annual	net	sales	for	each	brand,	royalty	rates	(as	a	percentage	of	net	sales	that	would hypothetically	be	charged	by	a	licensor	of	the	brand	to	an	unrelated	licensee),	income	tax	considerations,	long-term	growth	rates,	a	discount	rate	that	reflects	the	level	of risk	associated	with	the	future	cost	savings	attributable	to	the	brand,	and	management's	intent	to	invest	in	the	brand	indefinitely.	We	selected	the	assumptions	used	in	the financial	forecasts	using	historical	data,	supplemented	by	current	and	anticipated	market	conditions,	estimated	product	category	growth	rates,	management's	plans,	and guideline	companies.

The	discount	rates,	long-term	growth	rates,	and	royalty	rates	we	used	to	estimate	the	fair	values	of	our	reporting	units	and	brands	with	20%	or	less	excess	fair	value	over carrying	amount,	as	of	the	latest	2018	impairment	testing	date	for	each	reporting	unit	or	brand,	were	as	follows:

|  | Goodwill	Carrying<br>Value<br>(in	billions) | Discount	Rate<br>Minimum | Maximum | Long-Term	Growth	Rate<br>Minimum | Maximum | Royalty	Rate<br>Minimum | Maximum |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Reporting\tunits | $29.0 | 7.0% | 10.7% | 1.5% | 4.7% |  |  |
| Brands\n(excess\tearnings\tmethod) | 24.4 | 7.5% | 7.5% | 0.8% | 2.1% |  |  |
| Brands\n(relief\tfrom\troyalty\tmethod) | 4.9 | 7.5% | 10.2% | 0.5% | 4.0% | 1.0% | 20.0% |

Assumptions	used	in	impairment	testing	are	made	at	a	point	in	time	and	require	significant	judgment;	therefore,	they	are	subject	to	change	based	on	the	facts	and circumstances	present	at	each	annual	and	interim	impairment	test	date.	Additionally,	these	assumptions	are	generally	interdependent	and	do	not	change	in	isolation. However,	as	it	is	reasonably	possible	that	changes	in	assumptions	could	occur,	as	a	sensitivity	measure,	we	have	presented	the	estimated	effects	of	isolated	changes	in discount	rates,	long-term	growth	rates,	and	royalty	rates	for	our	reporting	units	and	brands	with	20%	or	less	excess	fair	value	over	carrying	amount.	If	we	had	changed the	assumptions	used	to	estimate	the	fair	value	of	our	reporting	units	and	brands	with	20%	or	less	excess	fair	value	over	carrying	amount,	as	of	the	latest	testing	date	for each	of	these	reporting	units	and	brands,	these	isolated	changes,	which	are	reasonably	possible	to	occur,	would	have	led	to	the	following	increase/(decrease)	in	the aggregate	fair	value	of	these	reporting	units	and	brands	(in	billions):

|  | Discount	Rate | Discount	Rate | Long-Term	Growth	Rate | Long-Term	Growth	Rate | Royalty	Rate | Royalty	Rate |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | 50-Basis-Point | 50-Basis-Point | 25-Basis-Point |  | 100-Basis-Point | 100-Basis-Point |
|  | Increase | Decrease | Increase | Decrease | Increase | Decrease |
| Reporting\tunits(a) | $(5.3) | $6.3 | $2.6 | $(2.4) |  |  |
| Brands\t(excess\tearnings\tmethod)(a) | (1.9) | 2.3 | 0.9 | (0.8) |  |  |
| Brands\t(relief\tfrom\troyalty\tmethod)(a) | (0.4) | 0.5 | 0.2 | (0.2) | $0.4 | $(0.4) |

(a) A	reduction	in	fair	value	would	not	necessarily	cause	an	impairment	in	all	cases,	but	due	to	the	low	or	zero	excess	fair	value	over	carrying	amount	for	these	reporting	units	and	brands,	it	is reasonably	possible	that	a	reduction	in	fair	value	would	lead	to	an	impairment.

Definite-lived	intangible	assets	are	amortized	on	a	straight-line	basis	over	the	estimated	periods	benefited.	We	review	definite-lived	intangible	assets	for	impairment when	conditions	exist	that	indicate	the	carrying	amount	of	the	assets	may	not	be	recoverable.	Such	conditions	could	include	significant	adverse	changes	in	the	business climate,	current-period	operating	or	cash	flow	losses,	significant	declines	in	forecasted	operations,	or	a	current	expectation	that	an	asset	group	will	be	disposed	of	before the	end	of	its	useful	life.	We	perform	undiscounted	operating	cash	flow	analyses	to	determine	if	an	impairment	exists.	When	testing	for	impairment	of	definite-lived intangible	assets	held	for	use,	we	group	assets	at	the	lowest	level	for	which	cash	flows	are	separately	identifiable.	If	an	impairment	is	determined	to	exist,	the	loss	is calculated	based	on	estimated	fair	value.	Impairment	losses	on	definite-lived	intangible	assets	to	be	disposed	of,	if	any,	are	based	on	the	estimated	proceeds	to	be received,	less	costs	of	disposal.

See	Note	10,	Goodwill	and	Intangible	Assets,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	details	related	to	our	2018	impairment	testing.

Although	our	annual	impairment	test	is	performed	during	the	second	quarter,	we	perform	a	qualitative	assessment	each	interim	reporting	period	to	determine	if	it	is	more likely	than	not	that	the	fair	value	of	any	reporting	unit	is	below	its	carrying	amount.	While	we	have	not	completed	such	impairment	assessment	for	the	first	fiscal	quarter of	2019,	nor	have	we	completed	our	2019	annual	impairment	testing	as	of	the	first	day	of	our	second	fiscal	quarter,	it	is	reasonably	possible	that	an	impairment	of	certain reporting	units	or	brands	could	occur	based	on	continued	industry	trends	impacting	our	results	of	operations.

# Postemployment	Benefit	Plans:

We	maintain	various	retirement	plans	for	the	majority	of	our	employees.	These	include	pension	benefits,	postretirement	health	care	benefits,	and	defined	contribution benefits.	The	cost	of	these	plans	is	charged	to	expense	over	an	appropriate	term	based	on,	among	other	things,	the	cost	component	and	whether	the	plan	is	active	or inactive.	Changes	in	the	fair	value	of	our	plan	assets	result	in	net	actuarial	gains	or	losses.	These	net	actuarial	gains	and	losses	are	deferred	into	accumulated	other comprehensive	income/(losses)	and	amortized	within	other	expense/(income),	net	in	future	periods	using	the	corridor	approach.	The	corridor	is	10%	of	the	greater	of	the market-related	value	of	the	plan's	asset	or	projected	benefit	obligation.	Any	actuarial	gains	and	losses	in	excess	of	the	corridor	are	then	amortized	over	an	appropriate term	based	on	whether	the	plan	is	active	or	inactive.

For	our	postretirement	benefit	plans,	our	2019	health	care	cost	trend	rate	assumption	will	be	6.7%.	We	established	this	rate	based	upon	our	most	recent	experience	as well	as	our	expectation	for	health	care	trend	rates	going	forward.	We	anticipate	the	weighted	average	assumed	ultimate	trend	rate	will	be	4.9%.	The	year	in	which	the ultimate	trend	rate	is	reached	varies	by	plan,	ranging	between	the	years	2019	and	2030.	Assumed	health	care	cost	trend	rates	have	a	significant	effect	on	the	amounts reported	for	the	health	care	plans.	A	one-percentage-point	change	in	assumed	health	care	cost	trend	rates	would	have	had	the	following	effects,	increase/(decrease)	in cost	and	obligation,	as	of	December	29,	2018	(in	millions):

|  | Increase | (Decrease) |
| :--- | :--- | :--- |
| Effect\ton\tannual\tservice\tand\tinterest\tcost | $3 | $(3) |
| Effect\ton\tpostretirement\tbenefit\tobligation | 48 | (41) |

Our	2019	discount	rate	assumption	will	be	4.3%	for	service	cost	and	4.1%	for	interest	cost	for	our	postretirement	plans.	Our	2019	discount	rate	assumption	will	be	4.6% for	service	cost	and	4.4%	for	interest	cost	for	our	U.S.	pension	plans	and	3.4%	for	service	cost	and	3.3%	for	interest	cost	for	our	non-U.S.	pension	plans.	We	model	these discount	rates	using	a	portfolio	of	high	quality,	fixed-income	debt	instruments	with	durations	that	match	the	expected	future	cash	flows	of	the	plans.	Changes	in	our discount	rates	were	primarily	the	result	of	changes	in	bond	yields	year-over-year.

In	2016,	we	changed	the	method	we	use	to	estimate	the	service	cost	and	interest	cost	components	of	net	pension	cost/(benefit)	and	net	postretirement	benefit	plan	costs resulting	in	a	decrease	to	these	cost	components.	We	now	use	a	full	yield	curve	approach	to	estimate	service	cost	and	interest	cost	by	applying	the	specific	spot	rates along	the	yield	curve	used	to	determine	the	benefit	obligation	to	the	relevant	projected	cash	flows.	Previously,	we	estimated	service	cost	and	interest	cost	using	a	single weighted-average	discount	rate	derived	from	the	yield	curve	used	to	measure	the	benefit	obligation	at	the	beginning	of	the	period.	We	made	this	change	to	provide	a	more precise	measurement	of	service	cost	and	interest	cost	by	improving	the	correlation	between	projected	benefit	cash	flows	and	the	corresponding	spot	yield	curve	rates. This	change	will	not	affect	the	measurement	of	our	total	benefit	obligations.	We	accounted	for	this	change	prospectively	as	a	change	in	accounting	estimate.

Our	2019	expected	return	on	plan	assets	will	be	5.4%	(net	of	applicable	taxes)	for	our	postretirement	plans.	Our	2019	expected	rate	of	return	on	plan	assets	will	be	5.7% for	our	U.S.	pension	plans	and	5.4%	for	our	non-U.S.	pension	plans.	We	determine	our	expected	rate	of	return	on	plan	assets	from	the	plan	assets'	historical	long-term investment	performance,	current	and	future	asset	allocation,	and	estimates	of	future	long-term	returns	by	asset	class.	We	attempt	to	maintain	our	target	asset	allocation	by re-balancing	between	asset	classes	as	we	make	contributions	and	monthly	benefit	payments.

While	we	do	not	anticipate	further	changes	in	the	2019	assumptions	for	our	U.S.	and	non-U.S.	pension	and	postretirement	benefit	plans,	as	a	sensitivity	measure,	a	100- basis-point	change	in	our	discount	rate	or	a	100-basis-point	change	in	the	expected	rate	of	return	on	plan	assets	would	have	the	following	effects,	increase/(decrease)	in cost	(in	millions):

|  | U.S.	Plans | U.S.	Plans | Non-U.S.	Plans | Non-U.S.	Plans |
| :--- | :--- | :--- | :--- | :--- |
|  | 100-Basis-Point | 100-Basis-Point | 100-Basis-Point | 100-Basis-Point |
|  | Increase | Decrease | Increase | Decrease |
| Effect\tof\tchange\tin\tdiscount\trate\ton\tpension\tcosts | $11 | $(17) | $(2) | $(7) |
| Effect\tof\tchange\tin\texpected\trate\tof\treturn\ton\tplan\tassets\ton\tpension\tcosts | (41) | 41 | (27) | 27 |
| Effect\tof\tchange\tin\tdiscount\trate\ton\tpostretirement\tcosts | (8) | 1 | — | (1) |
| Effect\tof\tchange\tin\texpected\trate\tof\treturn\ton\tplan\tassets\ton\tpostretirement\tcosts | (10) | 10 | — | — |

# Income	Taxes:

We	compute	our	annual	tax	rate	based	on	the	statutory	tax	rates	and	tax	planning	opportunities	available	to	us	in	the	various	jurisdictions	in	which	we	earn	income. Significant	judgment	is	required	in	determining	our	annual	tax	rate	and	in	evaluating	the	uncertainty	of	our	tax	positions.	We	recognize	a	benefit	for	tax	positions	that	we believe	will	more	likely	than	not	be	sustained	upon	examination.	The	amount	of	benefit	recognized	is	the	largest	amount	of	benefit	that	we	believe	has	more	than	a	50% probability	of	being	realized	upon	settlement.	We	regularly	monitor	our	tax	positions	and	adjust	the	amount	of	recognized	tax	benefit	based	on	our	evaluation	of information	that	has	become	available	since	the	end	of	our	last	financial	reporting	period.	The	annual	tax	rate	includes	the	impact	of	these	changes	in	recognized	tax benefits.	When	adjusting	the	amount	of	recognized	tax	benefits,	we	do	not	consider	information	that	has	become	available	after	the	balance	sheet	date,	however	we	do disclose	the	effects	of	new	information	whenever	those	effects	would	be	material	to	our	financial	statements.	Unrecognized	tax	benefits	represent	the	difference	between the	amount	of	benefit	taken	or	expected	to	be	taken	in	a	tax	return	and	the	amount	of	benefit	recognized	for	financial	reporting.	These	unrecognized	tax	benefits	are recorded	primarily	within	other	non-current	liabilities	on	the	consolidated	balance	sheets.

We	record	valuation	allowances	to	reduce	deferred	tax	assets	to	the	amount	that	is	more	likely	than	not	to	be	realized.	When	assessing	the	need	for	valuation	allowances, we	consider	future	taxable	income	and	ongoing	prudent	and	feasible	tax	planning	strategies.	Should	a	change	in	circumstances	lead	to	a	change	in	judgment	about	the realizability	of	deferred	tax	assets	in	future	years,	we	would	adjust	related	valuation	allowances	in	the	period	that	the	change	in	circumstances	occurs,	along	with	a corresponding	increase	or	decrease	to	income.	The	resolution	of	tax	reserves	and	changes	in	valuation	allowances	could	be	material	to	our	results	of	operations	for	any period	but	is	not	expected	to	be	material	to	our	financial	position.

# New	Accounting	Pronouncements

See	Note	4,	New	Accounting	Standards,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	a	discussion	of	new	accounting	pronouncements.

# Contingencies

See	Note	18,	Commitments	and	Contingencies,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	a	discussion	of	our	contingencies.

# Commodity	Trends

We	purchase	and	use	large	quantities	of	commodities,	including	dairy	products,	meat	products,	coffee	beans,	nuts,	tomatoes,	potatoes,	soybean	and	vegetable	oils,	sugar and	other	sweeteners,	corn	products,	and	wheat	products	to	manufacture	our	products.	In	addition,	we	purchase	and	use	significant	quantities	of	resins,	metals,	and cardboard	to	package	our	products	and	natural	gas	to	operate	our	facilities.	We	continuously	monitor	worldwide	supply	and	cost	trends	of	these	commodities.

We	define	our	key	commodities	in	the	United	States	and	Canada	as	dairy,	meat,	coffee,	and	nuts.	In	2018,	we	experienced	cost	decreases	for	dairy,	coffee,	and	meat, while	costs	for	nuts	increased.	We	manage	commodity	cost	volatility	primarily	through	pricing	and	risk	management	strategies.	As	a	result	of	these	risk	management strategies,	our	commodity	costs	may	not	immediately	correlate	with	market	price	trends.

Dairy	commodities,	primarily	milk	and	cheese,	are	the	most	significant	cost	components	of	our	cheese	products.	We	purchase	our	dairy	raw	material	requirements	from independent	third	parties,	such	as	agricultural	cooperatives	and	independent	processors.	Market	supply	and	demand,	as	well	as	government	programs,	significantly influence	the	prices	for	milk	and	other	dairy	products.	Significant	cost	components	of	our	meat	products	include	pork,	beef,	and	poultry,	which	we	primarily	purchase from	applicable	local	markets.	Livestock	feed	costs	and	the	global	supply	and	demand	for	U.S.	meats	influence	the	prices	of	these	meat	products.	The	most	significant cost	component	of	our	coffee	products	is	coffee	beans,	which	we	purchase	on	global	markets.	Quality	and	availability	of	supply,	currency	fluctuations,	and	consumer demand	for	coffee	products	impact	coffee	bean	prices.	The	most	significant	cost	components	in	our	nut	products	include	peanuts,	cashews,	and	almonds,	which	we purchase	on	both	domestic	and	global	markets,	where	global	market	supply	and	demand	is	the	primary	driver	of	prices.

# Liquidity	and	Capital	Resources

We	believe	that	cash	generated	from	our	operating	activities,	commercial	paper	programs,	and	Senior	Credit	Facility	will	provide	sufficient	liquidity	to	meet	our	working capital	needs,	future	contractual	obligations	(including	repayments	of	long-term	debt),	payment	of	our	anticipated	quarterly	dividends,	planned	capital	expenditures, restructuring	expenditures,	and	contributions	to	our	postemployment	benefit	plans.	An	additional	potential	source	of	liquidity	is	access	to	capital	markets.	We	intend	to use	our	cash	on	hand	and	our	commercial	paper	programs	for	daily	funding	requirements.	Overall,	while,	as	noted	above,	we	are	not	currently	eligible	 to	use	a registration	statement	on	Form	S-3,	we	do	not	expect	any	negative	effects	on	our	funding	sources	that	would	have	a	material	effect	on	our	short-term	or	long-term liquidity.

During	the	period	from	December	29,	2018	to	the	filing	date	of	this	Annual	Report	on	Form	10-K,	due	to	the	delays	in	the	preparation	of	our	financial	statements	for	the fiscal	year	ended	December	29,	2018	and	the	fiscal	quarter	ended	March	30,	2019,	we	were	not	in	compliance	with	certain	reporting	covenants	under	the	Senior	Credit Facility	and	certain	indentures.	As	a	result,	we	obtained	temporary	waivers	from	certain	creditors	under	our	indebtedness	instruments.	The	filing	of	this	Annual	Report on	Form	10-K	will	constitute	compliance	with	the	requirement	to	furnish	the	lenders	a	copy	of	the	consolidated	financial	statements	for	our	fiscal	year	ended	December 29,	2018	no	later	than	June	28,	2019.	We	also	currently	expect	to	file	our	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	March	30,	2019	on	or	before	July	31, 2019	in	compliance	with	the	requirement	to	furnish	the	lenders	a	copy	of	the	consolidated	financial	statements	for	such	quarter	no	later	than	July	31,	2019.	See	the	"Total Debt"	section	below	for	additional	information.

# Net	Cash	Provided	by/Used	for	Operating	Activities:

Net	cash	provided	by	operating	activities	was	$2.6	billion	for	the	year	ended	December	29,	2018	compared	to	$501	million	for	the	year	ended	December	30,	2017.	This increase	was	primarily	driven	by	decreased	postemployment	benefit	contributions	in	2018,	the	timing	of	income	tax	payments,	higher	collections	on	trade	receivables	as fewer	 were	 non-cash	 exchanged	 for	 sold	 receivables	 in	 connection	 with	 the	 unwind	 of	 all	 of	 our	 accounts	 receivable	 securitization	 and	 factoring	 programs	 (the "Programs")	in	2018,	and	decreased	cash	payments	for	employee	bonuses	in	2018.	These	increases	in	cash	provided	by	operating	activities	were	partially	offset	by unfavorable	changes	in	accounts	payable,	primarily	due	to	the	timing	of	payments.

# Net	Cash	Provided	by/Used	for	Investing	Activities:

Net	cash	provided	by	investing	activities	was	$288	million	for	the	year	ended	December	29,	2018	compared	to	$1.2	billion	for	the	year	ended	December	30,	2017.	This decrease	was	primarily	due	to	lower	cash	collections	on	previously	sold	receivables	of	$990	million,	as	we	unwound	all	of	our	Programs	in	2018,	and	cash	payments	to acquire	businesses	in	2018,	primarily	Cerebos	Pacific	Limited.	These	decreases	in	cash	provided	by	investing	activities	were	partially	offset	by	decreased	capital expenditures,	which	was	driven	by	the	wind-up	of	Integration	Program	footprint	costs	in	the	prior	year.	We	expect	2019	capital	expenditures	to	be	approximately	$800 million.	Refer	to	Item	8,	Financial	Statements	and	Supplementary	Data,	including	Note	17,	Financing	Arrangements,	for	additional	information	on	our	Programs,	Note 5,	Acquisitions	and	Divestitures,	for	additional	information	on	our	2018	acquisitions,	and	Note	6,	Integration	and	Restructuring	Expenses,	for	additional	information	on the	Integration	Program.

# Net	Cash	Provided	by/Used	for	Financing	Activities:

Net	cash	used	for	financing	activities	was	$3.4	billion	for	the	year	 ended	December	29,	2018	compared	 to	$4.2	billion	for	 the	year	 ended	December	30,	2017.	This decrease	was	primarily	driven	by	increased	proceeds	from	long-term	debt	issuances,	which	more	than	offset	increased	cash	distributions	related	to	our	dividends,	higher net	repayments	of	commercial	paper,	and	higher	repayments	of	long-term	debt.	See	Note	19,	Debt, in	 Item	 8,	Financial	Statements	and	Supplementary	Data, for additional	information	on	our	long-term	debt	issuances	and	repayments.	See	Equity	and	Dividends	in	this	item	for	additional	information	on	our	dividends.

Net	cash	provided	by	operating	activities	was	$501	million	for	the	year	ended	December	30,	2017	compared	to	$2.6	billion	for	the	year	ended	December	31,	2016.	The decrease	in	cash	provided	by	operating	activities	was	primarily	driven	by	the	$1.2	billion	pre-funding	of	our	postretirement	benefit	plans	in	2017,	lower	collections	on receivables	as	more	were	non-cash	exchanged	for	sold	receivables,	favorable	changes	in	accounts	payable	from	vendor	payment	term	renegotiations	that	were	less pronounced	than	the	prior	year,	and	increased	cash	payments	of	employee	bonuses	in	2017.	The	decrease	in	cash	provided	by	operating	activities	was	partially	offset	by lower	cash	payments	for	income	taxes	in	2017	driven	by	our	pre-funding	of	postretirement	plan	benefits	following	U.S.	Tax	Reform	enactment	on	December	22,	2017.

Net	cash	provided	by	investing	activities	was	$1.2	billion	for	the	year	ended	December	30,	2017	compared	to	$1.5	billion	for	the	year	ended	December	31,	2016.	The decrease	in	cash	provided	by	investing	activities	was	primarily	due	to	lower	cash	inflows	from	our	Programs,	as	well	as	lower	proceeds	from	cash	settlements	on	net investment	hedges.	Capital	expenditures	were	flat	in	2017	compared	to	2016.

Net	cash	used	for	financing	activities	was	$4.2	billion	for	the	year	ended	December	30,	2017	compared	 to	$4.6	billion	for	 the	year	ended	December	31,	2016.	The decrease	was	driven	by	the	benefit	of	fewer	dividend	payments	in	2017	compared	to	2016,	which	more	than	offset	higher	net	repayments	of	long-term	debt	and commercial	paper	in	2017	compared	to	2016,	including	cash	outflows	associated	with	the	redemption	of	our	Series	A	Preferred	Stock	in	2016.	Dividend	payments	were lower	in	2017	compared	to	2016	due	to	the	absence	of	the	Series	A	Preferred	Stock	dividend	and	the	impact	of	four	common	stock	cash	distributions	in	2017	compared	to five	such	distributions	in	2016.	See	Equity	and	Dividends	for	additional	information	on	cash	distributions	related	to	common	stock	and	Series	A	Preferred	Stock.

# Cash	Held	by	International	Subsidiaries:

Of	the	$1.1	billion	cash	and	cash	equivalents	on	our	consolidated	balance	sheet	at	December	29,	2018,	$923	million	was	held	by	international	subsidiaries.

We	consider	the	unremitted	current	year	earnings	of	certain	international	subsidiaries	that	impose	local	country	taxes	on	dividends	to	be	indefinitely	reinvested.	For those	undistributed	earnings	considered	to	be	indefinitely	reinvested,	our	intent	is	to	reinvest	these	funds	in	our	international	operations,	and	our	current	plans	do	not demonstrate	a	need	to	repatriate	the	accumulated	earnings	to	fund	our	U.S.	cash	requirements.	The	amount	of	unrecognized	deferred	tax	liabilities	for	local	country withholding	taxes	that	would	be	owed	related	to	our	current	year	earnings	of	certain	international	subsidiaries	is	approximately	$20	million.

Our	historic	earnings	in	foreign	subsidiaries	through	December	30,	2017	are	undistributed	and	currently	not	considered	to	be	indefinitely	reinvested.	As	of	December	29, 2018,	we	have	recorded	a	deferred	tax	liability	of	$78	million	on	$1.2	billion	of	historic	earnings	related	to	local	withholding	taxes	that	will	be	owed	when	this	cash	is distributed.

# Total	Debt:

We	obtain	funding	through	our	U.S.	and	European	commercial	paper	programs.	At	December	29,	2018,	we	had	no	commercial	paper	outstanding.	At	December	30, 2017,	we	had	commercial	paper	outstanding	of	$448	million	with	a	weighted	average	interest	rate	of	1.541%.	The	maximum	amount	of	commercial	paper	outstanding during	the	year	ended	December	29,	2018	was	$1.1	billion.

We	maintain	our	$4.0	billion	Senior	Credit	Facility,	and	subject	to	certain	conditions,	we	may	increase	the	amount	of	revolving	commitments	and/or	add	additional tranches	 of	 term	 loans	 in	 a	 combined	 aggregate	 amount	 of	 up	 to	 $1.0	 billion.	 No	 amounts	 were	 drawn	 on	 our	 Senior	 Credit	 Facility	 at	December	29,	2018,	 at December	30,	2017,	or	during	the	years	ended	December	29,	2018,	December	30,	2017,	and	December	31,	2016.	In	June	2018,	we	entered	into	an	agreement	that	became effective	on	July	6,	2018	to	extend	the	maturity	date	of	our	Senior	Credit	Facility	from	July	6,	2021	to	July	6,	2023	and	to	establish	a	$400	million	euro	equivalent	swing line	facility,	which	is	available	under	the	$4.0	billion	revolving	credit	facility	limit	for	short-term	loans	denominated	in	euros	on	a	same-day	basis.	The	Senior	Credit Facility	contains	representations,	warranties,	and	covenants	that	are	typical	for	these	types	of	facilities	and	could	upon	the	occurrence	of	certain	events	of	default	restrict our	ability	to	access	our	Senior	Credit	Facility.	We	were	in	compliance	with	all	financial	covenants	during	the	year	ended	December	29,	2018.

During	the	period	from	December	29,	2018	to	the	filing	date	of	this	Annual	Report	on	Form	10-K,	due	to	the	delays	in	the	preparation	of	our	financial	statements	for	the fiscal	year	ended	December	29,	2018	and	the	fiscal	quarter	ended	March	30,	2019,	we	were	not	in	compliance	with	certain	reporting	covenants	under	the	Senior	Credit Facility.

However,	as	previously	disclosed,	on	March	22,	2019,	we	entered	into	a	Waiver	and	Consent	No.	1	(the	"Original	Waiver")	with	respect	to	the	Senior	Credit	Facility, pursuant	to	which	the	lenders	party	thereto	and	JPMorgan	Chase	Bank,	N.A.,	as	administrative	agent,	granted	a	temporary	waiver	of	compliance	by	us	with	respect	to	the requirement	to	furnish	the	lenders	a	copy	of	the	consolidated	financial	statements	for	our	fiscal	year	ended	December	29,	2018.	Pursuant	to	the	Original	Waiver,	we	were required	to	provide	consolidated	financial	statements	no	later	than	May	14,	2019.	Due	to	additional	delays	in	our	financial	reporting,	on	May	10,	2019,	we	entered	into	a Waiver	and	Consent	No.	2	(the	"Second	Waiver")	with	respect	to	the	Senior	Credit	Facility,	pursuant	to	which	the	lenders,	as	party	to	the	Senior	Credit	Facility,	and JPMorgan	Chase	Bank,	N.A.,	as	administrative	agent,	granted	a	temporary	waiver	of	compliance	by	us	with	respect	to	the	requirements	to	furnish	the	lenders	copies	of the	consolidated	financial	statements	for	our	fiscal	year	ended	December	29,	2018	and	for	the	fiscal	quarter	ended	March	30,	2019.	Pursuant	to	the	Second	Waiver	and	in order	to	remedy	our	noncompliance,	we	are	required	to	provide	consolidated	financial	statements	for	our	fiscal	year	ended	December	29,	2018	no	later	than	June	28, 2019	and	for	our	fiscal	quarter	ended	March	30,	2019	no	later	than	July	31,	2019.	If	we	had	not	obtained	these	waivers,	we	would	not	have	been	able	to	access	our	Senior Credit	Facility.

Our	 long-term	debt,	 including	 the	 current	 portion,	 was	$31.1	billion	 at	December	29,	2018	 and	$31.0	billion	 at	December	30,	2017.	Our	 long-term	 debt	 contains customary	representations,	covenants,	and	events	of	default.	We	were	in	compliance	with	all	financial	covenants	during	the	year	ended	December	29,	2018.

During	the	period	from	December	29,	2018	to	the	filing	date	of	this	Annual	Report	on	Form	10-K,	due	to	the	delays	in	the	preparation	of	our	financial	statements	for	the fiscal	year	ended	December	29,	2018	and	the	fiscal	quarter	ended	March	30,	2019,	we	were	not	in	compliance	with	certain	reporting	covenants	under	certain	indentures. The	filing	of	this	Annual	Report	on	Form	10-K	will	constitute	compliance	with	the	requirement	to	furnish	the	lenders	a	copy	of	the	consolidated	financial	statements	for our	fiscal	year	ended	December	29,	2018	no	later	than	June	28,	2019.	We	also	currently	expect	to	file	our	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	March 30,	2019	on	or	before	July	31,	2019	in	compliance	with	the	requirement	to	furnish	the	lenders	a	copy	of	the	consolidated	financial	statements	for	such	quarter	no	later than	July	31,	2019.

Under	our	existing	indentures,	if	we	do	not	file	required	reports	within	specified	time	periods,	the	trustee	or	holders	of	at	least	30%	in	the	case	of	our	Second	Lien	Senior Secured	Notes	due	2025	and	25%	in	the	case	of	any	other	series	of	notes	may	deliver	a	notice	of	default	for	such	series	of	notes	which	would	commence	the	applicable cure	period	under	such	indenture.	As	of	June	5,	2019,	none	of	the	cure	periods	under	our	existing	indentures	have	been	triggered	in	connection	with	our	failure	to	comply with	the	respective	reporting	covenants	set	forth	in	such	indentures.	However,	if	a	cure	period	is	triggered	under	such	indentures	and	we	fail	to	file	our	annual	and interim	financial	statements	within	such	cure	period,	any	outstanding	notes	issued	thereunder	would	become	callable.

Our	senior	notes	maturing	in	2019	and	2020	include	aggregate	principal	amounts	of	approximately	$350	million	in	August	2019,	approximately	$900	million	in	February 2020,	and	approximately	800	million	Canadian	dollars	and	$1.5	billion	in	July	2020.	We	expect	to	fund	these	long-term	debt	repayments	primarily	with	cash	on	hand, cash	generated	from	our	operating	activities,	proceeds	from	our	divestiture	in	Canada,	and	potential	new	issuances	of	short-term	or	long-term	debt.

See	Note	19,	Debt,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	additional	information	related	to	our	long-term	debt.

# Off-Balance	Sheet	Arrangements	and	Aggregate	Contractual	Obligations

# Off-Balance	Sheet	Arrangements:

We	do	not	have	guarantees	or	other	off-balance	sheet	financing	arrangements	that	we	believe	are	reasonably	likely	to	have	a	current	or	future	effect	on	our	financial condition,	changes	in	financial	condition,	revenue	or	expenses,	results	of	operations,	liquidity,	capital	expenditures,	or	capital	resources.

We	have	utilized	accounts	receivable	securitization	and	factoring	programs	globally	for	our	working	capital	needs	and	to	provide	efficient	liquidity.	During	2018,	we	had Programs	in	place	in	various	countries	across	the	globe.	In	the	second	quarter	of	2018,	we	unwound	our	U.S.	securitization	program,	which	represented	the	majority	of our	Programs,	using	proceeds	from	the	issuance	of	long-term	debt	in	June	2018.	As	of	December	29,	2018,	we	have	unwound	all	of	our	Programs.

See	Note	17,	Financing	Arrangements,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	a	discussion	of	our	Programs	and	other	financing	arrangements.

# Aggregate	Contractual	Obligations:

The	following	table	summarizes	our	contractual	obligations	at	December	29,	2018	(in	millions):

|  | 2019 | 2020-2021 | 2022-2023 | Thereafter | Total |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Long-term\tdebt(a) | 1,641 | 6,369 | 8,046 | 32,195 | 48,251 |
| Capital\tleases(b)(f) | 27 | 98 | 27 | 85 | 237 |
| Operating\tleases(c)(f) | 185 | 242 | 119 | 148 | 694 |
| Purchase\tobligations(d)(f) | 1,569 | 1,162 | 497 | 217 | 3,445 |
| Other\tlong-term\tliabilities(e) | 41 | 83 | 98 | 203 | 425 |
| Total | 3,463 | 7,954 | 8,787 | 32,848 | 53,052 |

(a)		Amounts	represent	the	expected	cash	payments	of	our	long-term	debt,	including	interest	on	variable	and	fixed	rate	long-term	debt.	Interest	on	variable	rate	long-term	debt	is	calculated	based	on interest	rates	at	December	29,	2018.

(b) Amounts	represent	the	expected	cash	payments	of	our	capital	leases,	including	expected	cash	payments	of	interest	expense.

(c) Operating	leases	represent	the	minimum	rental	commitments	under	non-cancelable	operating	leases.

(d) We	have	purchase	obligations	for	materials,	supplies,	property,	plant	and	equipment,	and	co-packing,	storage,	and	distribution	services	based	on	projected	needs	to	be	utilized	in	the	normal	course of	business.	Other	purchase	obligations	include	commitments	for	marketing,	advertising,	capital	expenditures,	information	technology,	and	professional	services.	Arrangements	are	considered purchase	obligations	if	a	contract	specifies	all	significant	terms,	including	fixed	or	minimum	quantities	to	be	purchased,	a	pricing	structure,	and	approximate	timing	of	the	transaction.	Several	of these	obligations	are	long-term	and	are	based	on	minimum	purchase	requirements.	Certain	purchase	obligations	contain	variable	pricing	components,	and,	as	a	result,	actual	cash	payments	are expected	to	fluctuate	based	on	changes	in	these	variable	components.	Due	to	the	proprietary	nature	of	some	of	our	materials	and	processes,	certain	supply	contracts	contain	penalty	provisions	for early	terminations.	We	do	not	believe	that	a	material	amount	of	penalties	is	reasonably	likely	to	be	incurred	under	these	contracts	based	upon	historical	experience	and	current	expectations.	We exclude	amounts	reflected	on	the	consolidated	balance	sheet	as	accounts	payable	and	accrued	liabilities	from	the	table	above.

(e) Other	long-term	liabilities	primarily	consist	of	estimated	payments	for	the	one-time	toll	charge	related	to	U.S.	Tax	Reform,	as	well	as	postretirement	benefit	commitments.	Certain	other	long-term liabilities	related	to	income	taxes,	insurance	accruals,	and	other	accruals	included	on	the	consolidated	balance	sheet	are	excluded	from	the	above	table	as	we	are	unable	to	estimate	the	timing	of payments	for	these	items.

(f) As	part	of	the	restatement	described	in	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements ,	in	Item	8,	Financial	Statements	and	Supplementary	Data ,	certain	amounts	in prior	years,	if	presented,	would	have	been	recategorized	between	capital	leases,	operating	leases,	and	purchase

obligations	as	well	as	across	future	periods.	There	would	have	been	no	impact	on	the	total	future	contractual	obligations	as	of	December	30,	2017	or	December	31,	2016.

Pension	plan	contributions	were	$57	million	in	2018.	We	estimate	that	2019	pension	plan	contributions	will	be	approximately	$15	million.	Beyond	2019,	we	are	unable to	reliably	estimate	the	timing	of	contributions	to	our	pension	plans.	Our	actual	contributions	and	plans	may	change	due	to	many	factors,	including	changes	in	tax, employee	benefit,	or	other	laws	and	regulations,	tax	deductibility,	significant	differences	between	expected	and	actual	pension	asset	performance	or	interest	rates,	or other	factors.	As	such,	estimated	pension	plan	contributions	for	2019	have	been	excluded	from	the	above	table.

Postretirement	benefit	plan	contributions	were	$19	million	in	2018.	We	estimate	that	2019	postretirement	benefit	plan	contributions	will	be	approximately	$15	million. Beyond	2019,	we	are	unable	to	reliably	estimate	the	timing	of	contributions	to	our	postretirement	benefit	plans.	Our	actual	contributions	and	plans	may	change	due	to many	 factors,	 including	 changes	 in	 tax,	 employee	 benefit,	 or	 other	 laws	 and	 regulations,	 tax	 deductibility,	 significant	 differences	 between	 expected	 and	 actual postretirement	plan	asset	performance	or	interest	rates,	or	other	factors.	As	such,	estimated	postretirement	benefit	plan	contributions	for	2019	have	been	excluded	from the	above	table.

At	December	29,	2018,	the	amount	of	net	unrecognized	tax	benefits	for	uncertain	tax	positions,	including	an	accrual	of	related	interest	and	penalties	along	with	positions only	impacting	the	timing	of	tax	benefits,	was	approximately	$445	million.	The	timing	of	payments	will	depend	on	the	progress	of	examinations	with	tax	authorities.	We do	not	expect	a	significant	tax	payment	related	to	these	obligations	within	the	next	year.	We	are	unable	to	make	a	reasonably	reliable	estimate	as	to	if	or	when	any significant	cash	settlements	with	taxing	authorities	may	occur;	therefore,	we	have	excluded	the	amount	of	net	unrecognized	tax	benefits	from	the	above	table.

# Equity	and	Dividends

# Common	Stock	Dividends:

The	declaration	of	dividends	is	subject	to	the	discretion	of	our	Board	of	Directors	and	depends	on	various	factors,	including	our	net	income,	financial	condition,	cash requirements,	future	prospects,	and	other	factors	that	our	Board	of	Directors	deems	relevant	to	its	analysis	and	decision	making.

# Series	A	Preferred	Stock	Dividends:

On	June	7,	2016,	we	redeemed	all	outstanding	shares	of	our	Series	A	Preferred	Stock.	Accordingly,	we	no	longer	pay	any	associated	dividends,	and	there	were	no	such dividend	payments	in	2018	or	2017.	Prior	to	the	redemption,	we	made	cash	distributions	of	$180	million	in	2016.

See	Note	19,	Debt,	and	Note	20,	Capital	Stock,	in	Item	8,	Financial	Statements	and	Supplementary	Data,	for	additional	information.

# Non-GAAP	Financial	Measures

The	non-GAAP	financial	measures	we	provide	in	this	report	should	be	viewed	in	addition	to,	and	not	as	an	alternative	for,	results	prepared	in	accordance	with	U.S. GAAP.

To	supplement	the	consolidated	financial	statements	prepared	in	accordance	with	U.S.	GAAP,	we	have	presented	Organic	Net	Sales,	Adjusted	EBITDA,	and	Adjusted EPS,	which	are	considered	non-GAAP	financial	measures.	The	non-GAAP	financial	measures	presented	may	differ	from	similarly	titled	non-GAAP	financial	measures presented	by	other	companies,	and	other	companies	may	not	define	these	non-GAAP	financial	measures	in	the	same	way.	These	measures	are	not	substitutes	for	their comparable	U.S.	GAAP	financial	measures,	such	as	net	sales,	net	income/(loss),	diluted	earnings	per	common	share	("EPS"),	or	other	measures	prescribed	by	U.S. GAAP,	and	there	are	limitations	to	using	non-GAAP	financial	measures.

Management	uses	these	non-GAAP	financial	measures	to	assist	in	comparing	our	performance	on	a	consistent	basis	for	purposes	of	business	decision	making	by removing	the	impact	of	certain	items	that	management	believes	do	not	directly	reflect	our	underlying	operations.	Management	believes	that	presenting	our	non-GAAP financial	measures	(i.e.,	Organic	Net	Sales,	Adjusted	EBITDA,	and	Adjusted	EPS)	is	useful	to	investors	because	it	(i)	provides	investors	with	meaningful	supplemental information	regarding	financial	performance	by	excluding	certain	items,	(ii)	permits	investors	to	view	performance	using	the	same	tools	that	management	uses	to	budget, make	operating	and	strategic	decisions,	and	evaluate	historical	performance,	and	(iii)	otherwise	provides	supplemental	information	that	may	be	useful	to	investors	in evaluating	our	results.	We	believe	that	the	presentation	of	these	non-GAAP	financial	measures,	when	considered	together	with	the	corresponding	U.S.	GAAP	financial measures	and	the	reconciliations

to	those	measures,	provides	investors	with	additional	understanding	of	the	factors	and	trends	affecting	our	business	than	could	be	obtained	absent	these	disclosures.

Organic	Net	Sales	is	defined	as	net	sales	excluding,	when	they	occur,	the	impact	of	currency,	acquisitions	and	divestitures,	and	a	53rd	week	of	shipments.	We	calculate the	impact	of	currency	on	net	sales	by	holding	exchange	rates	constant	at	the	previous	year's	exchange	rate,	with	the	exception	of	Venezuela,	for	which	we	calculate	the previous	year's	results	using	the	current	year's	exchange	rate.	Organic	Net	Sales	is	a	tool	that	can	assist	management	and	investors	in	comparing	our	performance	on	a consistent	basis	by	removing	the	impact	of	certain	items	that	management	believes	do	not	directly	reflect	our	underlying	operations.

Adjusted	EBITDA	is	defined	as	net	income/(loss)	from	continuing	operations	before	interest	expense,	other	expense/(income),	net,	provision	for/(benefit	from)	income taxes,	and	depreciation	and	amortization	(excluding	integration	and	restructuring	expenses);	in	addition	to	these	adjustments,	we	exclude,	when	they	occur,	the	impacts of	integration	and	restructuring	expenses,	deal	costs,	unrealized	losses/(gains)	on	commodity	hedges,	impairment	losses,	losses/(gains)	on	the	sale	of	a	business,	other losses/(gains)	related	to	acquisitions	and	divestitures	(e.g.,	tax	and	hedging	impacts),	nonmonetary	currency	devaluation	(e.g.,	remeasurement	gains	and	losses),	and equity	award	compensation	expense	(excluding	 integration	and	restructuring	expenses).	Adjusted	EBITDA	 is	a	 tool	 that	can	assist	management	and	 investors	 in comparing	our	performance	on	a	consistent	basis	by	removing	the	impact	of	certain	items	that	management	believes	do	not	directly	reflect	our	underlying	operations.

Adjusted	 EPS	 is	 defined	 as	 diluted	 earnings	 per	 share	 excluding,	 when	 they	 occur,	 the	 impacts	 of	 integration	 and	 restructuring	 expenses,	 deal	 costs,	 unrealized losses/(gains)	on	commodity	hedges,	impairment	losses,	losses/(gains)	on	the	sale	of	a	business,	other	losses/(gains)	related	to	acquisitions	and	divestitures	(e.g.,	tax	and hedging	impacts),	nonmonetary	currency	devaluation	(e.g.,	remeasurement	gains	and	losses),	and	U.S.	Tax	Reform	discrete	income	tax	expense/(benefit),	and	including, when	they	occur,	adjustments	to	reflect	preferred	stock	dividend	payments	on	an	accrual	basis.	We	believe	Adjusted	EPS	provides	important	comparability	of	underlying operating	results,	allowing	investors	and	management	to	assess	operating	performance	on	a	consistent	basis.

# Reconciliation	of	Net	Sales	to	Organic	Net	Sales

(dollars	in	millions)

(Unaudited)

|  | Net	Sales | Currency | Acquisitions	and<br>Divestitures | Organic	Net<br>Sales | Price | Volume/Mix |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| 2018 |  |  |  |  |  |  |
| United\tStates | $18,122 | $— | $— | $18,122 |  |  |
| Canada | 2,173 | (5) | — | 2,178 |  |  |
| EMEA | 2,718 | 66 | 19 | 2,633 |  |  |
| Rest\tof\tWorld | 3,255 | (75) | 158 | 3,172 |  |  |
| Kraft\tHeinz | $26,268 | $(14) | $177 | $26,105 |  |  |
| 2017\t(As\tRestated) |  |  |  |  |  |  |
| United\tStates | $18,230 | $— | $— | $18,230 |  |  |
| Canada | 2,177 | — | — | 2,177 |  |  |
| EMEA | 2,585 | — | 56 | 2,529 |  |  |
| Rest\tof\tWorld | 3,084 | 144 | — | 2,940 |  |  |
| Kraft\tHeinz | $26,076 | $144 | $56 | $25,876 |  |  |
| Year-over-year\tgrowth\trates |  |  |  |  |  |  |
| United\tStates | (0.6)% | 0.0\tpp | 0.0\tpp | (0.6)% | (0.9)\tpp | 0.3\tpp |
| Canada | (0.2)% | (0.3)\tpp | 0.0\tpp | 0.1\t% | (0.6)\tpp | 0.7\tpp |
| EMEA | 5.1\t% | 2.5\tpp | (1.5)\tpp | 4.1\t% | 0.9\tpp | 3.2\tpp |
| Rest\tof\tWorld | 5.6\t% | (7.6)\tpp | 5.3\tpp | 7.9\t% | 5.4\tpp | 2.5\tpp |
| Kraft\tHeinz | 0.7\t% | (0.6)\tpp | 0.4\tpp | 0.9\t% | 0.0\tpp | 0.9\tpp |

|  | Net	Sales | Currency | Acquisitions	and<br>Divestitures | Organic	Net<br>Sales | Price | Volume/Mix |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| 2017\t(As\tRestated) |  |  |  |  |  |  |
| United\tStates | $18,230 | $— | $— | $18,230 |  |  |
| Canada | 2,177 | 42 | — | 2,135 |  |  |
| EMEA | 2,585 | (14) | 50 | 2,549 |  |  |
| Rest\tof\tWorld | 3,084 | 35 | — | 3,049 |  |  |
| Kraft\tHeinz | $26,076 | $63 | $50 | $25,963 |  |  |
| 2016\t(As\tRestated) |  |  |  |  |  |  |
| United\tStates | $18,469 | $— | $— | $18,469 |  |  |
| Canada | 2,302 | — | — | 2,302 |  |  |
| EMEA | 2,586 | — | 57 | 2,529 |  |  |
| Rest\tof\tWorld | 2,943 | 55 | — | 2,888 |  |  |
| Kraft\tHeinz | $26,300 | $55 | $57 | $26,188 |  |  |
| Year-over-year\tgrowth\trates |  |  |  |  |  |  |
| United\tStates | (1.3)% | 0.0\tpp | 0.0\tpp | (1.3)% | 0.5\tpp | (1.8)\tpp |
| Canada | (5.4)% | 1.9\tpp | 0.0\tpp | (7.3)% | (1.8)\tpp | (5.5)\tpp |
| EMEA | —\t% | (0.5)\tpp | (0.3)\tpp | 0.8\t% | (0.5)\tpp | 1.3\tpp |
| Rest\tof\tWorld | 4.8\t% | (0.8)\tpp | 0.0\tpp | 5.6\t% | 4.2\tpp | 1.4\tpp |
| Kraft\tHeinz | (0.9)% | 0.0\tpp | 0.0\tpp | (0.9)% | 0.6\tpp | (1.5)\tpp |

# Reconciliation	of	Net	Income/(Loss)	to	Adjusted	EBITDA

# (in	millions)

|  |  | As	Restated	&amp;	Recast |  |
| :--- | :--- | :--- | :--- |
|  | December\t29,\n2018 | December\t30,\n2017 | December\t31,\n2016 |
| Net\tincome/(loss) | $(10,254) | $10,932 | $3,606 |
| Interest\texpense | 1,284 | 1,234 | 1,134 |
| Other\texpense/(income),\tnet | (183) | (627) | (472) |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | (1,067) | (5,482) | 1,333 |
| Operating\tincome/(loss) | (10,220) | 6,057 | 5,601 |
| Depreciation\tand\tamortization\t(excluding\tintegration\tand\trestructuring\texpenses) | 919 | 907 | 875 |
| Integration\tand\trestructuring\texpenses | 297 | 583 | 992 |
| Deal\tcosts | 23 | — | 30 |
| Unrealized\tlosses/(gains)\ton\tcommodity\thedges | 21 | 19 | (38) |
| Impairment\tlosses | 15,936 | 49 | 71 |
| Losses/(gains)\ton\tsale\tof\tbusiness | 15 | — | — |
| Nonmonetary\tcurrency\tdevaluation | — | — | 4 |
| Equity\taward\tcompensation\texpense\t(excluding\tintegration\tand\trestructuring\texpenses) | 33 | 49 | 39 |
| Adjusted\tEBITDA | $7,024 | $7,664 | $7,574 |

# Reconciliation	of	Diluted	EPS	to	Adjusted	EPS

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Diluted\tEPS | $(8.36) | $8.91 | $2.78 |
| Integration\tand\trestructuring\texpenses(a) | 0.32 | 0.24 | 0.57 |
| Deal\tcosts(b) | 0.02 | — | 0.02 |
| Unrealized\tlosses/(gains)\ton\tcommodity\thedges(c) | 0.01 | 0.01 | (0.02) |
| Impairment\tlosses(d) | 11.28 | 0.03 | 0.04 |
| Losses/(gains)\ton\tsale\tof\tbusiness(e) | 0.01 | — | — |
| Other\tlosses/(gains)\trelated\tto\tacquisitions\tand\tdivestitures(f) | 0.02 | — | — |
| Nonmonetary\tcurrency\tdevaluation(g) | 0.12 | 0.03 | 0.02 |
| Preferred\tdividend\tadjustment(h) | — | — | (0.10) |
| U.S.\tTax\tReform\tdiscrete\tincome\ttax\texpense/(benefit)(i) | 0.09 | (5.72) | — |
| Adjusted\tEPS | $3.51 | $3.50 | $3.31 |

(a) Gross	expenses	included	in	integration	and	restructuring	expenses	were $460	million	in	2018	($396	million	after-tax),	$434	million	in	2017	($305	million	after-tax),	and	$1.0	billion	in	2016	($697 million	after-tax)	and	were	recorded	in	the	following	income	statement	line	items:

(b) Gross	expenses	included	in	deal	costs	were	 $23	million	in	2018	($19	million	after-tax)	and	$30	million	in	2016	($20	million	after-tax)	and	were	recorded	in	the	following	income	statement	line items:

(c) Gross	expenses/(income)	included	in	unrealized	losses/(gains)	on	commodity	hedges	were	expenses	of $21	million	in	2018	($16	million	after-tax),	expenses	of	$19	million	in	2017	($12	million after-tax),	and	income	of	$38	million	in	2016	($25	million	after-tax)	and	were	recorded	in	cost	of	products	sold.

(d) Gross	expenses	included	in	impairment	losses	were	 $15.9	billion	in	2018	($13.8	billion	after-tax),	$49	million	in	2017	($36	million	after-tax),	and	$71	million	in	2016	($46	million	after-tax)	and were	recorded	in	the	following	income	statement	line	items:

•Cost	of	products	sold	included	$53	million	in	2016;	and

(e) Gross	expenses	included	in	losses/(gains)	on	sale	of	business	were	 $15	million	in	2018	($15	million	after-tax)	and	were	recorded	in	SG&A.

(f) Gross	expenses	included	in	other	losses/(gains)	related	to	acquisitions	and	divestitures	were	 $27	million	in	2018	($15	million	after-tax)	and	were	recorded	in	the	following	income	statement	line items:

•Interest	expense	included	$3	million	in	2018;

•Other	expense/(income),	net,	included	$17	million	in	2018;	and

•Provision	for/(benefit	from)	income	taxes	included	$7	million	in	2018.

(g) Gross	expenses	included	in	nonmonetary	currency	devaluation	were	 $146	million	in	2018	($146	million	after	tax),	$36	million	in	2017	($36	million	after-tax),	and	$28	million	in	2016	($28	million after-tax)	and	were	recorded	in	the	following	income	statement	line	items:

(h) For	Adjusted	EPS,	we	present	the	impact	of	the	Series	A	Preferred	Stock	dividend	payments	on	an	accrual	basis.	Accordingly,	we	included	adjustments	to	EPS	to	include	$180	million	Series	A Preferred	Stock	dividends	in	the	first	quarter	of	2016	(to	reflect	the	March	7,	2016	Series	A	Preferred	Stock	dividend	that	was	paid	in	December	2015)	and	to	exclude	$51	million	of	Series	A Preferred	Stock	dividends	from	the	second	quarter	of	2016	(to	reflect	that	it	was	redeemed	on	June	7,	2016).

(i) U.S.	Tax	Reform	discrete	income	tax	expense/(benefit)	was	an	expense	of	$104	million	in	2018	and	a	benefit	of	$7.0	billion	in	2017.	Expenses	in	2018	primarily	related	to	the	revaluation	of	our deferred	tax	balances	due	to	changes	in	state	tax	laws	following	U.S.	Tax	Reform.	These	expenses	were	partially	offset	by	net	benefits	related	to	changes	in	U.S.	tax	reserves,	U.S.	Tax	Reform measurement	period	adjustments,	changes	in	estimates	of	certain	2017	U.S.	income	tax	deductions,	and	the	release	of	valuation	allowances	related	to	foreign	tax	credits.	The	benefit	in	2017	was related	to	the	enactment	of	U.S.	Tax	Reform.	See	Note	11,	Income	Taxes,	in	Item	8,	Financial	Statements	and	Supplementary	Data ,	for	additional	information.

# Supplemental	Unaudited	Quarterly	Financial	Information

The	following	unaudited	quarterly	financial	information	is	presented	to	illustrate	the	effects	of	the	corrections	of	misstatements	to	previously	reported	quarterly	financial information	as	a	result	of	the	restatement.	Such	corrections	of	misstatements	are	described	in	more	detail	in	Note	2,	Restatement	of	Previously	Issued	Consolidated Financial	Statements,	in	Item	8,	Financial	Statements	and	Supplementary	Data.

The	 following	 unaudited	 quarterly	 financial	 information	 for	 the	 fiscal	 quarters	 ended	 December	 29,	 2018	 September	 29,	 2018,	 June	 30,	 2018,	 March	 31,	 2018, December	30,	2017,	September	30,	2017,	July	1,	2017,	and	April	1,	2017	is	derived	from	our	audited	consolidated	financial	statements	for	the	year	ended	December	29, 2018	and	our	restated	audited	consolidated	financial	statements	for	the	year	ended	December	30,	2017.	This	unaudited	quarterly	financial	information	should	be	read	in conjunction	with	the	other	sections	of	this	Annual	Report	on	Form	10-K,	including	the	consolidated	financial	statements	and	related	notes	contained	in	Item	8,	Financial Statements	and	Supplementary	Data.

The	following	tables	represent	the	unaudited	reconciliation	of	net	sales	to	Organic	Net	Sales.	Organic	Net	Sales	is	a	non-GAAP	financial	measure.	See	the	Non-GAAP Financial	Measures	section	within	this	item	for	the	related	definition.

|  |  | For	the	Three	Months	Ended	December	29,	2018 | For	the	Three	Months	Ended	December	29,	2018 |  |  | For	the	Three	Months	Ended	December	30,	2017 | For	the	Three	Months	Ended	December	30,	2017 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Net\tSales | Currency | Acquisitions\tand\nDivestitures | Organic\tNet\nSales | Net\tSales | Currency | Acquisitions\tand\nDivestitures | Organic\tNet\nSales |
|  |  | (in\tmillions) | (in\tmillions) |  |  | (in\tmillions) | (in\tmillions) |  |
| United\tStates | $4,810 | $— | $— | $4,810 | $4,760 | $— | $— | $4,760 |
| Canada | 600 | (24) | — | 624 | 589 | — | — | 589 |
| EMEA | 692 | (31) | — | 723 | 696 | — | 13 | 683 |
| Rest\tof\tWorld | 789 | (42) | 48 | 783 | 796 | 53 | — | 743 |
| Kraft\tHeinz | $6,891 | $(97) | $48 | $6,940 | $6,841 | $53 | $13 | $6,775 |
|  |  |  |  | As\tRestated | As\tRestated |  |  |  |
|  |  | For\tthe\tThree\tMonths\tEnded\tSeptember\t29,\t2018 | For\tthe\tThree\tMonths\tEnded\tSeptember\t29,\t2018 |  |  | For\tthe\tThree\tMonths\tEnded\tSeptember\t30,\t2017 | For\tthe\tThree\tMonths\tEnded\tSeptember\t30,\t2017 |  |
|  |  | Acquisitions\tand | Acquisitions\tand | Organic\tNet |  | Acquisitions\tand | Acquisitions\tand | Organic\tNet |

|  | Net	Sales | Currency | Divestitures | Sales | Net	Sales | Currency | Divestitures | Sales |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  | (in\tmillions) | (in\tmillions) |  |  | (in\tmillions) | (in\tmillions) |  |
| United\tStates | $4,513 | $— | $— | $4,513 | $4,601 | $— | $— | $4,601 |
| Canada | 564 | 21 | — | 543 | 592 | — | — | 592 |
| EMEA | 707 | 35 | 11 | 661 | 644 | — | 15 | 629 |
| Rest\tof\tWorld | 906 | (4) | 63 | 847 | 797 | 33 | — | 764 |
| Kraft\tHeinz | $6,690 | $52 | $74 | $6,564 | $6,634 | $33 | $15 | $6,586 |

|  |  | For	the	Three	Months	Ended	March	31,	2018 | For	the	Three	Months	Ended	March	31,	2018 |  |  | For	the	Three	Months	Ended	April	1,	2017 | For	the	Three	Months	Ended	April	1,	2017 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Net\tSales | Currency | Acquisitions\tand\nDivestitures | Organic\tNet\nSales | Net\tSales | Currency | Acquisitions\tand\nDivestitures | Organic\tNet\nSales |
|  |  | (in\tmillions) | (in\tmillions) |  |  | (in\tmillions) | (in\tmillions) |  |
| United\tStates | $4,368 | $— | $— | $4,368 | $4,518 | $— | $— | $4,518 |
| Canada | 484 | 22 | — | 462 | 440 | — | — | 440 |
| EMEA | 685 | 74 | 8 | 603 | 595 | — | 16 | 579 |
| Rest\tof\tWorld | 767 | 17 |  | 750 | 769 | 40 |  | 729 |
| Kraft\tHeinz | $6,304 | $113 | $8 | $6,183 | $6,322 | $40 | $16 | $6,266 |

The	following	tables	represent	the	unaudited	reconciliation	of	net	income/(loss)	to	Adjusted	EBITDA.	Adjusted	EBITDA	is	a	non-GAAP	financial	measure.	See	the Non-GAAP	Financial	Measures	section	within	this	item	for	the	related	definition.

|  |  | For	the	Three	Months	Ended |  |  |
| :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\t2018 | September\t29,\t2018 | June\t30,\n2018 | March\t31,\n2018 |
|  |  | (in\tmillions) |  |  |
| Net\tincome/(loss) | $(12,628) | $618 | $753 | $1,003 |
| Interest\texpense | 325 | 326 | 316 | 317 |
| Other\texpense/(income),\tnet | 13 | (71) | (35) | (90) |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | (1,846) | 201 | 308 | 270 |
| Operating\tincome/(loss) | (14,136) | 1,074 | 1,342 | 1,500 |
| Depreciation\tand\tamortization\t(excluding\tintegration\tand\trestructuring\texpenses) | 240 | 245 | 235 | 199 |
| Integration\tand\trestructuring\texpenses | 82 | 32 | 93 | 90 |
| Deal\tcosts | 4 | 3 | 7 | 9 |
| Unrealized\tlosses/(gains)\ton\tcommodity\thedges | 10 | 6 | 3 | 2 |
| Impairment\tlosses | 15,485 | 217 | 234 | — |
| Losses/(gains)\ton\tsale\tof\tbusiness | — | — | 15 | — |
| Equity\taward\tcompensation\texpense\t(excluding\tintegration\tand\trestructuring\nexpenses) | (11) | 17 | 20 | 7 |
| Adjusted\tEBITDA | $1,674 | $1,594 | $1,949 | $1,807 |

|  |  | As	Restated	&amp;	Recast |  |  |
| :--- | :--- | :--- | :--- | :--- |
|  |  | For\tthe\tThree\tMonths\tEnded |  |  |
|  | December\t30,\t2017 | September\t30,\n2017 | July\t1,\n2017 | April\t1,\n2017 |
|  |  | (in\tmillions) |  |  |
| Net\tincome/(loss) | $7,982 | $912 | $1,157 | $881 |
| Interest\texpense | 308 | 306 | 307 | 313 |
| Other\texpense/(income),\tnet | (116) | (127) | (254) | (130) |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | (6,665) | 400 | 429 | 354 |
| Operating\tincome/(loss) | 1,509 | 1,491 | 1,639 | 1,418 |
| Depreciation\tand\tamortization\t(excluding\tintegration\tand\trestructuring\texpenses) | 224 | 243 | 219 | 221 |
| Integration\tand\trestructuring\texpenses | 208 | 108 | 132 | 135 |
| Unrealized\tlosses/(gains)\ton\tcommodity\thedges | (5) | (5) | (13) | 42 |
| Impairment\tlosses | — | 1 | 48 | — |
| Equity\taward\tcompensation\texpense\t(excluding\tintegration\tand\trestructuring\nexpenses) | 11 | 12 | 14 | 12 |
| Adjusted\tEBITDA | $1,947 | $1,850 | $2,039 | $1,828 |

The	following	tables	represent	the	unaudited	reconciliation	of	diluted	EPS	to	Adjusted	EPS.	Adjusted	EPS	is	a	non-GAAP	financial	measure.	See	the	 Non-GAAP Financial	Measures	section	within	this	item	for	the	related	definition.

|  |  | For	the	Three	Months	Ended |  |  |
| :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\t2018 | September\t29,\n2018 | June\t30,\n2018 | March\t31,\t2018 |
|  |  | (in\tmillions) |  |  |
| Diluted\tEPS | $(10.30) | $0.50 | $0.62 | $0.82 |
| Integration\tand\trestructuring\texpenses(a) | 0.13 | 0.03 | 0.11 | 0.05 |
| Deal\tcosts(b) | — | — | 0.01 | 0.01 |
| Unrealized\tlosses/(gains)\ton\tcommodity\thedges(c) | 0.01 | — | — | — |
| Impairment\tlosses(d) | 10.97 | 0.13 | 0.17 | — |
| Losses/(gains)\ton\tsale\tof\tbusiness(e) | — | — | 0.01 | — |
| Other\tlosses/(gains)\trelated\tto\tacquisitions\tand\tdivestitures(f) | 0.02 | — | — | — |
| Nonmonetary\tcurrency\tdevaluation(g) | 0.01 | 0.05 | 0.02 | 0.04 |
| U.S.\tTax\tReform\tdiscrete\tincome\ttax\texpense/(benefit)(h) | — | 0.05 | 0.05 | (0.02) |
| Adjusted\tEPS | $0.84 | $0.76 | $0.99 | $0.90 |

(a) Gross	expenses	included	in	integration	and	restructuring	expenses	were	 $182	million	($159	million	after-tax),	$31	million	($31	million	after-tax),	$157	million	($135	million	after-tax),	and	$90 million	($72	million	after-tax)	for	the	three	months	ended	December	29,	2018,	September	29,	2018,	June	30,	2018,	and	March	31,	2018,	respectively,	and	were	recorded	in	the	following	income statement	line	items:

•Other	expense/(income),	net,	included	expenses	of	$100	million,	income	of	$1	million,	and	expenses	of	$64	million	for	the	three	months	ended	December	29,	2018,	September	29,	2018	and June	30,	2018,	respectively.

(b) Gross	expenses	included	in	deal	costs	were	 $4	million	($4	million	after-tax),	$3	million	($2	million	after-tax),	$7	million	($6	million	after-tax),	and	$9	million	($7	million	after-tax)	for	the	three months	ended	December	29,	2018,	September	29,	2018,	June	30,	2018,	and	March	31,	2018,	respectively,	and	were	recorded	in	the	following	income	statement	line	items:

•Cost	of	products	sold	included	$4	million	for	the	three	months	ended	June	30,	2018;	and

(c) Gross	expenses	included	in	unrealized	losses/(gains)	on	commodity	hedges	were	 $10	million	($6	million	after-tax),	$6	million	($5	million	after-tax),	 $3	million	($3	million	after-tax),	and	$2 million	($1	million	after-tax)	for	the	three	months	ended	December	29,	2018,	September	29,	2018,	June	30,	2018,	and	March	31,	2018,	respectively,	and	were	recorded	in	cost	of	products	sold.

(e) Gross	expenses	included	in	losses/(gains)	on	sale	of	business	were	 $15	million	($15	million	after-tax)	for	the	three	months	ended	June	30,	2018	and	were	recorded	in	SG&A.

(f) Gross	expenses	included	in	other	losses/(gains)	related	to	acquisitions	and	divestitures	were $27	million	for	the	three	months	ended	December,	29	2018	($15	million	after-tax)	and	were	recorded	in the	following	income	statement	line	items:

•Interest	expense	included	$3	million	for	the	three	months	ended	December,	29	2018;

•Other	expense/(income),	net,	included	$17	million	for	the	three	months	ended	December,	29	2018;	and

•Provision	for/(benefit	from)	income	taxes	included	$7	million	for	the	three	months	ended	December,	29	2018.

|  |  | For	the	Three	Months	Ended |  |  |
| :--- | :--- | :--- | :--- | :--- |
|  | December\t30,\n2017 | September\t30,\n2017 | July\t1,\n2017 | April\t1,\n2017 |
|  |  | (in\tmillions) |  |  |
| Diluted\tEPS | $6.50 | $0.74 | $0.94 | $0.72 |
| Integration\tand\trestructuring\texpenses(a) | 0.11 | 0.07 | (0.01) | 0.08 |
| Unrealized\tlosses/(gains)\ton\tcommodity\thedges(b) | — | — | (0.01) | 0.02 |
| Impairment\tlosses(c) | — | — | 0.03 | — |
| Nonmonetary\tcurrency\tdevaluation(d) | — | — | 0.02 | 0.01 |
| U.S.\tTax\tReform\tdiscrete\tincome\ttax\texpense/(benefit)(e) | (5.72) | — | — | — |
| Adjusted\tEPS | $0.89 | $0.81 | $0.97 | $0.83 |

(a) Gross	expenses/(income)	included	in	integration	and	restructuring	expenses	were	expenses	of	 $210	million	($140	million	after-tax),	$104	million	($79	million	after-tax),	income	of	$28	million ($17	million	after-tax),	and	expenses	of	 $148	million	($101	million	after-tax)	for	the	three	months	ended	December	30,	2017,	September	30,	2017,	July	1,	2017,	and	April	1,	2017,	respectively, and	were	recorded	in	the	following	income	statement	line	items:

(b) Gross	expenses/(income)	included	in	unrealized	losses/(gains)	on	commodity	hedges	were	income	of	 $5	million	($4	million	after-tax),	income	of	$5	million	($3	million	after-tax),	income	of	$13 million	($7	million	 after-tax),	 and	 expenses	 of	 $42	million	($27	million	after-tax)	for	 the	 three	months	ended	December	30,	2017,	September	30,	2017,	July	1,	2017,	and	April	1,	2017, respectively,	and	were	recorded	in	cost	of	products	sold.

(c) Gross	expenses	included	in	impairment	losses	were	 $1	million	($1	million	after-tax)	and	$48	million	($34	million	after-tax)	for	the	three	months	ended	September	30,	2017	and	July	1,	2017, respectively,	and	were	recorded	in	SG&A.

(d) Gross	expenses	included	in	nonmonetary	currency	devaluation	were	 $3	million	($3	million	after-tax),	$25	million	($25	million	after-tax),	and	$8	million	($8	million	after-tax)	for	the	three	months ended	September	30,	2017,	July	1,	2017,	and	April	1,	2017,	respectively,	and	were	recorded	in	other	expense/(income),	net.

(e) U.S.	Tax	Reform	discrete	income	tax	expense/(benefit)	included	a	benefit	of	 $7.0	billion	for	the	three	months	ended	December	30,	2017.

# Item	7A.	Quantitative	and	Qualitative	Disclosures	About	Market	Risk.

We	are	exposed	to	market	risks	from	adverse	changes	in	commodity	prices,	foreign	exchange	rates,	and	interest	rates.	We	monitor	and	manage	these	exposures	as	part	of our	overall	risk	management	program.	Our	risk	management	program	focuses	on	the	unpredictability	of	financial	markets	and	seeks	to	reduce	the	potentially	adverse effects	that	volatility	in	these	markets	may	have	on	our	operating	results.	We	maintain	risk	management	policies	that	principally	use	derivative	financial	instruments	to reduce	significant,	unanticipated	fluctuations	in	earnings	and	cash	flows	that	may	arise	from	variations	in	commodity	prices,	foreign	currency	exchange	rates,	and	interest rates.	We	manage	market	risk	by	incorporating	parameters	within	our	risk	management	strategy	that	limit	the	types	of	derivative	instruments,	the	derivative	strategies	we use,	and	the	degree	of	market	risk	that	we	hedge	with	derivative	instruments.	See	Note	3,	Significant	Accounting	Policies,	and	Note	14,	Financial	Instruments,	in	Item	8, Financial	Statements	and	Supplementary	Data,	for	details	of	our	market	risk	management	policies	and	the	financial	instruments	used	to	hedge	those	exposures.

When	we	use	financial	instruments,	we	are	exposed	to	credit	risk	that	a	counterparty	might	fail	to	fulfill	its	performance	obligations	under	the	terms	of	our	agreement. We	minimize	our	credit	risk	by	entering	into	transactions	with	counterparties	with	investment	grade	credit	ratings,	limiting	the	amount	of	exposure	we	have	with	each counterparty,	and	monitoring	the	financial	condition	of	our	counterparties.	All	of	our	non-exchange	traded	derivative	contracts	are	governed	by	an	International	Swaps and	Derivatives	Association	master	agreement.	By	policy,	we	do	not	engage	in	speculative	or	leveraged	transactions,	nor	do	we	hold	or	issue	financial	instruments	for trading	purposes.

# Effect	of	Hypothetical	10%	Fluctuation	in	Market	Prices:

The	potential	gain	or	 loss	on	 the	fair	value	of	our	outstanding	commodity	contracts,	foreign	exchange	contracts,	and	cross-currency	swap	contracts,	assuming	a hypothetical	10%	fluctuation	in	commodity	prices	and	foreign	currency	exchange	rates,	would	have	been	(in	millions):

|  | December	29,<br>2018 | December	30,<br>2017 |
| :--- | :--- | :--- |
| Commodity\tcontracts | $38 | $23 |
| Foreign\tcurrency\tcontracts | 100 | 173 |
| Cross-currency\tswap\tcontracts | 402 | 287 |

It	should	be	noted	that	any	change	in	the	fair	value	of	our	derivative	contracts,	real	or	hypothetical,	would	be	significantly	offset	by	an	inverse	change	in	the	value	of	the underlying	hedged	items.	In	relation	to	foreign	currency	contracts,	this	hypothetical	calculation	assumes	that	each	exchange	rate	would	change	in	the	same	direction relative	to	the	U.S.	dollar.	Our	utilization	of	financial	instruments	in	managing	market	risk	exposures	described	above	is	consistent	with	the	prior	year.	Changes	in	our portfolio	of	financial	instruments	are	a	function	of	our	results	of	operations,	debt	repayments	and	debt	issuances,	market	effects	on	debt	and	foreign	currency,	and	our acquisition	and	divestiture	activities.

# Effect	of	Hypothetical	1%	Fluctuation	in	LIBOR	and	CDOR:

Based	on	our	current	variable	rate	debt	balance	as	of	December	29,	2018,	a	hypothetical	1%	increase	in	LIBOR	and	CDOR	would	increase	our	annual	interest	expense by	approximately	$19	million.

# Item	8.	Financial	Statements	and	Supplementary	Data.

# Report	of	Independent	Registered	Public	Accounting	Firm

To	the	Shareholders	and	Board	of	Directors	of	The	Kraft	Heinz	Company

# Opinions	on	the	Financial	Statements	and	Internal	Control	over	Financial	Reporting

We	have	audited	the	accompanying	consolidated	balance	sheets	of	The	Kraft	Heinz	Company	and	its	subsidiaries	(the	"Company")	as	of	December	29,	2018	and December	30,	2017,	and	the	related	consolidated	statements	of	income,	comprehensive	income,	equity	and	cash	flows	for	each	of	the	three	years	in	the	period	ended December	29,	2018,	including	the	related	notes	and	financial	statement	schedule	listed	in	the	index	appearing	under	Item	15	(a)	(collectively	referred	to	as	the "consolidated	financial	statements").	We	also	have	audited	the	Company's	internal	control	over	financial	reporting	as	of	December	29,	2018,	based	on	criteria	established in	Internal	Control	-	Integrated	Framework	(2013)	issued	by	the	Committee	of	Sponsoring	Organizations	of	the	Treadway	Commission	(COSO).

In	our	opinion,	the	consolidated	financial	statements	referred	to	above	present	fairly,	in	all	material	respects,	the	financial	position	of	the	Company	as	of	December	29, 2018	and	December	30,	2017,	and	the	results	of	its	operations	and	its	cash	flows	for	each	of	the	three	years	in	the	period	ended	December	29,	2018	in	conformity	with accounting	principles	generally	accepted	in	the	United	States	of	America.	Also	in	our	opinion,	the	Company	did	not	maintain,	in	all	material	respects,	effective	internal control	over	financial	reporting	as	of	December	29,	2018,	based	on	criteria	established	in	Internal	Control	-	Integrated	Framework	(2013)	issued	by	the	COSO	because material	weaknesses	in	internal	control	over	financial	reporting	existed	as	of	that	date	related	to	the	risk	assessment	component	of	internal	control,	as	the	Company	did not	appropriately	design	controls	in	response	to	the	risk	of	material	misstatement	due	to	changes	in	their	business	environment.	The	risk	assessment	material	weakness gave	rise	to	additional	material	weaknesses	as	the	Company	did	not	design	and	maintain	effective	controls	over	the	accounting	for	supplier	contracts	and	related arrangements	or	to	reassess	the	level	of	precision	used	to	review	the	impairment	assessments	related	to	forecasted	cash	flows	used	within	goodwill	and	indefinite-lived intangible	asset	impairment	calculations.

A	material	weakness	is	a	deficiency,	or	a	combination	of	deficiencies,	in	internal	control	over	financial	reporting,	such	that	there	is	a	reasonable	possibility	that	a	material misstatement	of	the	annual	or	interim	financial	statements	will	not	be	prevented	or	detected	on	a	timely	basis.	The	material	weaknesses	referred	to	above	are	described	in Management's	Report	on	Internal	Control	Over	Financial	Reporting	appearing	under	Item	9A.	We	considered	these	material	weaknesses	in	determining	the	nature, timing,	and	extent	of	audit	tests	applied	in	our	audit	of	the	2018	consolidated	financial	statements,	and	our	opinion	regarding	the	effectiveness	of	the	Company's	internal control	over	financial	reporting	does	not	affect	our	opinion	on	those	consolidated	financial	statements.

# Restatement	of	Previously	Issued	Financial	Statements

As	discussed	in	Note	2	to	the	consolidated	financial	statements,	the	Company	has	restated	its	2017	and	2016	financial	statements	to	correct	misstatements.

# Change	in	Accounting	Principle

As	discussed	in	Note	4	to	the	consolidated	financial	statements,	the	Company	changed	the	manner	in	which	it	presents	net	periodic	benefit	costs	in	2018.

# Basis	for	Opinions

The	Company's	management	is	responsible	for	these	consolidated	financial	statements,	for	maintaining	effective	internal	control	over	financial	reporting,	and	for	its assessment	of	the	effectiveness	of	internal	control	over	financial	reporting	included	in	management's	report	referred	to	above.	Our	responsibility	is	to	express	opinions	on the	Company's	consolidated	financial	statements	and	on	the	Company's	internal	control	over	financial	reporting	based	on	our	audits.	We	are	a	public	accounting	firm registered	with	the	Public	Company	Accounting	Oversight	Board	(United	States)	(PCAOB)	and	are	required	to	be	independent	with	respect	to	the	Company	in accordance	with	the	U.S.	federal	securities	laws	and	the	applicable	rules	and	regulations	of	the	Securities	and	Exchange	Commission	and	the	PCAOB.

We	conducted	our	audits	in	accordance	with	the	standards	of	the	PCAOB.	Those	standards	require	that	we	plan	and	perform	the	audits	to	obtain	reasonable	assurance about	whether	the	consolidated	financial	statements	are	free	of	material	misstatement,	whether	due	to	error	or	fraud,	and	whether	effective	internal	control	over	financial reporting	was	maintained	in	all	material	respects.

Our	audits	of	the	consolidated	financial	statements	included	performing	procedures	to	assess	the	risks	of	material	misstatement	of	the	consolidated	financial	statements, whether	due	to	error	or	fraud,	and	performing	procedures	that	respond	to	those	risks.	Such	procedures	included	examining,	on	a	test	basis,	evidence	regarding	the amounts	and	disclosures	in	the	consolidated	financial	statements.	Our	audits	also	included	evaluating	the	accounting	principles	used	and	significant	estimates	made	by management,	as	well	as	evaluating	the	overall	presentation	of	the	consolidated	financial	statements.	Our	audit	of	internal	control	over	financial	reporting	included obtaining	an	understanding	of	internal	control	over	financial	reporting,	assessing	the	risk	that	a	material	weakness	exists,	and	testing	and	evaluating	the	design	and operating	effectiveness	of	internal	control	based	on	the	assessed	risk.	Our	audits	also	included	performing	such	other	procedures	as	we	considered	necessary	in	the circumstances.	We	believe	that	our	audits	provide	a	reasonable	basis	for	our	opinions.

# Definition	and	Limitations	of	Internal	Control	over	Financial	Reporting

A	company's	internal	control	over	financial	reporting	is	a	process	designed	to	provide	reasonable	assurance	regarding	the	reliability	of	financial	reporting	and	the preparation	of	financial	statements	for	external	purposes	in	accordance	with	generally	accepted	accounting	principles.	A	company's	internal	control	over	financial reporting	includes	those	policies	and	procedures	that	(i)	pertain	to	the	maintenance	of	records	that,	in	reasonable	detail,	accurately	and	fairly	reflect	the	transactions	and dispositions	of	the	assets	of	the	company;	(ii)	provide	reasonable	assurance	that	transactions	are	recorded	as	necessary	to	permit	preparation	of	financial	statements	in accordance	with	generally	accepted	accounting	principles,	and	that	receipts	and	expenditures	of	the	company	are	being	made	only	in	accordance	with	authorizations	of management	and	directors	of	the	company;	and	(iii)	provide	reasonable	assurance	regarding	prevention	or	timely	detection	of	unauthorized	acquisition,	use,	or disposition	of	the	company's	assets	that	could	have	a	material	effect	on	the	financial	statements.

Because	of	its	inherent	limitations,	internal	control	over	financial	reporting	may	not	prevent	or	detect	misstatements.	Also,	projections	of	any	evaluation	of	effectiveness to	future	periods	are	subject	to	the	risk	that	controls	may	become	inadequate	because	of	changes	in	conditions,	or	that	the	degree	of	compliance	with	the	policies	or procedures	may	deteriorate.

/s/	PricewaterhouseCoopers	LLP Chicago,	Illinois June	7,	2019

We	have	served	as	the	Company's	or	its	predecessor's	auditor	since	1979.

# Consolidated	Statements	of	Income

# (in	millions,	except	per	share	data)

|  |  | As	Restated	&amp;	Recast |  |
| :--- | :--- | :--- | :--- |
|  | December\t29,\n2018 | December\t30,\n2017 | December\t31,\n2016 |
| Net\tsales | $26,268 | $26,076 | $26,300 |
| Cost\tof\tproducts\tsold | 17,347 | 17,043 | 17,154 |
| Gross\tprofit | 8,921 | 9,033 | 9,146 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\timpairment\tlosses | 3,205 | 2,927 | 3,527 |
| Goodwill\timpairment\tlosses | 7,008 | — | — |
| Intangible\tasset\timpairment\tlosses | 8,928 | 49 | 18 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 19,141 | 2,976 | 3,545 |
| Operating\tincome/(loss) | (10,220) | 6,057 | 5,601 |
| Interest\texpense | 1,284 | 1,234 | 1,134 |
| Other\texpense/(income),\tnet | (183) | (627) | (472) |
| Income/(loss)\tbefore\tincome\ttaxes | (11,321) | 5,450 | 4,939 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | (1,067) | (5,482) | 1,333 |
| Net\tincome/(loss) | (10,254) | 10,932 | 3,606 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (62) | (9) | 10 |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | (10,192) | 10,941 | 3,596 |
| Preferred\tdividends | — | — | 180 |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $(10,192) | $10,941 | $3,416 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |
| Basic\tearnings/(loss) | $(8.36) | $8.98 | $2.81 |
| Diluted\tearnings/(loss) | (8.36) | 8.91 | 2.78 |

See	accompanying	notes	to	the	consolidated	financial	statements.

# Consolidated	Statements	of	Comprehensive	Income

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Net\tincome/(loss) | $(10,254) | $10,932 | $3,606 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | (1,187) | 1,185 | (979) |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | 284 | (353) | 226 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | 7 | — | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | (7) | — | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | 99 | (113) | 46 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | 2 | — | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | (44) | 85 | (87) |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | 58 | 69 | (40) |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | 3 | 17 | 31 |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (118) | (309) | (204) |
| Total\tother\tcomprehensive\tincome/(loss) | (903) | 581 | (1,007) |
| Total\tcomprehensive\tincome/(loss) | (11,157) | 11,513 | 2,599 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (76) | (3) | 16 |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $(11,081) | $11,516 | $2,583 |

# Consolidated	Balance	Sheets

|  | December	29,	2018 | December	30,	2017 |
| :--- | :--- | :--- |
| ASSETS |  |  |
| Cash\tand\tcash\tequivalents | $1,130 | $1,629 |
| Trade\treceivables\t(net\tof\tallowances\tof\t$24\tat\tDecember\t29,\t2018\tand\t$23\tat\tDecember\t30,\t2017) | 2,129 | 921 |
| Sold\treceivables | — | 353 |
| Income\ttaxes\treceivable | 152 | 538 |
| Inventories | 2,667 | 2,760 |
| Prepaid\texpenses | 400 | 345 |
| Other\tcurrent\tassets | 1,221 | 655 |
| Assets\theld\tfor\tsale | 1,376 | — |
| Total\tcurrent\tassets | 9,075 | 7,201 |
| Property,\tplant\tand\tequipment,\tnet | 7,078 | 7,061 |
| Goodwill | 36,503 | 44,825 |
| Intangible\tassets,\tnet | 49,468 | 59,432 |
| Other\tnon-current\tassets | 1,337 | 1,573 |
| TOTAL\tASSETS | $103,461 | $120,092 |
| LIABILITIES\tAND\tEQUITY |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $21 | $462 |
| Current\tportion\tof\tlong-term\tdebt | 377 | 2,733 |
| Trade\tpayables | 4,153 | 4,362 |
| Accrued\tmarketing | 722 | 689 |
| Interest\tpayable | 408 | 419 |
| Other\tcurrent\tliabilities | 1,767 | 1,489 |
| Liabilities\theld\tfor\tsale | 55 | — |
| Total\tcurrent\tliabilities | 7,503 | 10,154 |
| Long-term\tdebt | 30,770 | 28,308 |
| Deferred\tincome\ttaxes | 12,202 | 14,039 |
| Accrued\tpostemployment\tcosts | 306 | 427 |
| Other\tnon-current\tliabilities | 902 | 1,088 |
| TOTAL\tLIABILITIES | 51,683 | 54,016 |
| Commitments\tand\tContingencies\t(Note\t18) |  |  |
| Redeemable\tnoncontrolling\tinterest | 3 | 6 |
| Equity: |  |  |
| 29,\t2018;\t1,221\tshares\tissued\tand\t1,219\tshares\toutstanding\tat\tDecember\t30,\t2017) | 12 | 12 |
| Additional\tpaid-in\tcapital | 58,723 | 58,634 |
| Retained\tearnings/(deficit) | (4,853) | 8,495 |
| Accumulated\tother\tcomprehensive\tincome/(losses) | (1,943) | (1,054) |
| Treasury\tstock,\tat\tcost\t(4\tshares\tat\tDecember\t29,\t2018\tand\t2\tshares\tat\tDecember\t30,\t2017) | (282) | (224) |
| Total\tshareholders'\tequity | 51,657 | 65,863 |
| Noncontrolling\tinterest | 118 | 207 |
| TOTAL\tEQUITY | 51,775 | 66,070 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $103,461 | $120,092 |

# Consolidated	Statements	of	Equity

|  | Common	Stock | Additional	Paid-<br>in	Capital | Retained<br>Earnings/(Deficit) | Accumulated	Other<br>Comprehensive<br>Income/(Losses) | Treasury	Stock,<br>at	Cost | Noncontrolling	Interest | Total	Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Balance\tat\tJanuary\t3,\t2016\t(As\tRestated) | 12 | 58,298 | — | (616) | (31) | 208 | 57,871 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest | — | — | 3,596 | — | — | 10 | 3,606 |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest | — | — | — | (1,013) | — | 6 | (1,007) |
| Dividends\tdeclared-Series\tA\tPreferred\tStock\n($2,250.00\tper\tshare) | — | — | (180) | — | — | — | (180) |
| Dividends\tdeclared-common\tstock\t($2.35\tper\tshare) | — | — | (2,862) | — | — | — | (2,862) |
| Dividends\tdeclared-noncontrolling\tinterest\t($90.82\nper\tshare) | — | — | — | — | — | (8) | (8) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\tstock\nawards,\tand\tother | — | 218 | (2) | — | (176) | — | 40 |
| Balance\tat\tDecember\t31,\t2016\t(As\tRestated) | 12 | 58,516 | 552 | (1,629) | (207) | 216 | 57,460 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest | — | — | 10,941 | — | — | (5) | 10,936 |
| Other\tcomprehensive\tincome/(loss) | — | — | — | 575 | — | 6 | 581 |
| Dividends\tdeclared-common\tstock\t($2.45\tper\tshare) | — | — | (2,988) | — | — | — | (2,988) |
| Dividends\tdeclared-noncontrolling\tinterest\t($52.75\nper\tshare) | — | — | — | — | — | (10) | (10) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\tstock\nawards,\tand\tother | — | 118 | (10) | — | (17) | — | 91 |
| Balance\tat\tDecember\t30,\t2017\t(As\tRestated) | 12 | 58,634 | 8,495 | (1,054) | (224) | 207 | 66,070 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest | — | — | (10,192) | — | — | (50) | (10,242) |
| Other\tcomprehensive\tincome/(loss) | — | — | — | (889) | — | (14) | (903) |
| Dividends\tdeclared-common\tstock\t($2.50\tper\tshare) | — | — | (3,048) | — | — | — | (3,048) |
| Dividends\tdeclared-noncontrolling\tinterest\t($174.76\nper\tshare) | — | — | — | — | — | (12) | (12) |
| Cumulative\teffect\tof\taccounting\tstandards\tadopted\tin\nthe\tperiod | — | — | (97) | — | — | — | (97) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\tstock\nawards,\tand\tother | — | 89 | (11) | — | (58) | (13) | 7 |
| Balance\tat\tDecember\t29,\t2018 | $12 | $58,723 | $(4,853) | $(1,943) | $(282) | $118 | $51,775 |

# Consolidated	Statements	of	Cash	Flows

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES: |  |  |  |
| Net\tincome/(loss) | $(10,254) | $10,932 | $3,606 |
| Adjustments\tto\treconcile\tnet\tincome/(loss)\tto\toperating\tcash\tflows: |  |  |  |
| Depreciation\tand\tamortization | 983 | 1,031 | 1,337 |
| Amortization\tof\tpostretirement\tbenefit\tplans\tprior\tservice\tcosts/(credits) | (339) | (328) | (347) |
| Equity\taward\tcompensation\texpense | 33 | 46 | 46 |
| Deferred\tincome\ttax\tprovision/(benefit) | (1,967) | (6,495) | (72) |
| Postemployment\tbenefit\tplan\tcontributions | (76) | (1,659) | (494) |
| Goodwill\tand\tintangible\tasset\timpairment\tlosses | 15,936 | 49 | 18 |
| Nonmonetary\tcurrency\tdevaluation | 146 | 36 | 24 |
| Other\titems,\tnet | 175 | 253 | 25 |
| Changes\tin\tcurrent\tassets\tand\tliabilities: |  |  |  |
| Trade\treceivables | (2,280) | (2,629) | (2,055) |
| Inventories | (251) | (236) | (130) |
| Accounts\tpayable | (23) | 441 | 879 |
| Other\tcurrent\tassets | (146) | (64) | (41) |
| Other\tcurrent\tliabilities | 637 | (876) | (148) |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | 2,574 | 501 | 2,648 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES: |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | 1,296 | 2,286 | 2,589 |
| Capital\texpenditures | (826) | (1,194) | (1,247) |
| Payments\tto\tacquire\tbusiness,\tnet\tof\tcash\tacquired | (248) | — | — |
| Other\tinvesting\tactivities,\tnet | 66 | 85 | 110 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 288 | 1,177 | 1,452 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES: |  |  |  |
| Repayments\tof\tlong-term\tdebt | (2,713) | (2,641) | (85) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | 2,990 | 1,496 | 6,981 |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | 2,784 | 6,043 | 6,680 |
| Repayments\tof\tcommercial\tpaper | (3,213) | (6,249) | (6,043) |
| Dividends\tpaid\t-\tSeries\tA\tPreferred\tStock | — | — | (180) |
| Dividends\tpaid\t-\tcommon\tstock | (3,183) | (2,888) | (3,584) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | — | — | (8,320) |
| Other\tfinancing\tactivities,\tnet | (28) | 18 | (69) |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (3,363) | (4,221) | (4,620) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\tcash | (132) | 57 | (137) |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash |  |  |  |
| Net\tincrease/(decrease) | (633) | (2,486) | (657) |
| Balance\tat\tbeginning\tof\tperiod | 1,769 | 4,255 | 4,912 |
| Balance\tat\tend\tof\tperiod | $1,136 | $1,769 | $4,255 |

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| NON-CASH\tINVESTING\tACTIVITIES: |  |  |  |
| Beneficial\tinterest\tobtained\tin\texchange\tfor\tsecuritized\ttrade\treceivables | $938 | $2,519 | $2,213 |
| CASH\tPAID\tDURING\tTHE\tPERIOD\tFOR: |  |  |  |
| Interest | $1,322 | $1,269 | $1,176 |
| Income\ttaxes | 543 | 1,206 | 1,619 |

# Notes	to	Consolidated	Financial	Statements

# Note	1.	Basis	of	Presentation

# Organization

On	July	2,	2015	(the	"2015	Merger	Date"),	through	a	series	of	transactions,	we	consummated	the	merger	of	Kraft	Foods	Group,	Inc.	("Kraft")	with	and	into	a	wholly- owned	subsidiary	of	H.J.	Heinz	Holding	Corporation	("Heinz")	(the	"2015	Merger").	At	the	closing	of	the	2015	Merger,	Heinz	was	renamed	The	Kraft	Heinz	Company ("Kraft	Heinz").	Before	the	consummation	of	the	2015	Merger,	Heinz	was	controlled	by	Berkshire	Hathaway	Inc.	and	3G	Global	Food	Holdings,	LP	("3G	Global	Food Holdings"	and	together	with	its	affiliates,	"3G	Capital"),	following	their	acquisition	of	H.	J.	Heinz	Company	on	June	7,	2013.

# Principles	of	Consolidation

The	consolidated	financial	statements	include	Kraft	Heinz,	as	well	as	our	wholly-owned	and	majority-owned	subsidiaries.	All	intercompany	transactions	are	eliminated.

Our	segments	reflect	a	change,	effective	in	the	first	quarter	of	our	fiscal	year	2018,	to	reorganize	our	international	businesses	to	better	align	our	global	geographies.	We moved	 our	 Middle	 East	 and	Africa	 businesses	 from	 the	 historical	Asia	 Pacific,	 Middle	 East,	 and	Africa	 ("AMEA")	operating	 segment	 into	 the	 historical	 Europe reportable	segment,	forming	the	new	EMEA	reportable	segment.	The	remaining	businesses	from	the	AMEA	operating	segment	became	the	APAC	operating	segment. We	have	reflected	this	change	in	all	historical	periods	presented.	See	Note	22,	Segment	Reporting,	for	our	financial	information	by	segment.

# Held	for	Sale

In	the	fourth	quarter	of	2018,	we	announced	our	plans	to	divest	certain	assets	and	operations,	predominantly	in	Canada	and	India.	At	December	29,	2018,	we	have classified	the	assets	and	liabilities	related	to	these	disposal	groups	as	held	for	sale	in	our	consolidated	balance	sheets.	These	assets	and	liabilities	are	included	in	assets held	for	sale	within	current	assets	and	liabilities	held	for	sale	within	current	liabilities.	See	Note	5,	Acquisitions	and	Divestitures,	for	additional	information.

# Use	of	Estimates

We	prepare	our	consolidated	financial	statements	in	accordance	with	accounting	principles	generally	accepted	in	the	United	States	of	America	("U.S.	GAAP"),	which requires	us	to	make	accounting	policy	elections,	estimates,	and	assumptions	that	affect	the	reported	amount	of	assets,	liabilities,	reserves,	and	expenses.	These	policy elections,	estimates,	and	assumptions	are	based	on	our	best	estimates	and	judgments.	We	evaluate	our	policy	elections,	estimates,	and	assumptions	on	an	ongoing	basis using	historical	experience	and	other	factors,	including	the	current	economic	environment.	We	believe	these	estimates	to	be	reasonable	given	the	current	facts	available. We	adjust	our	policy	elections,	estimates,	and	assumptions	when	facts	and	circumstances	dictate.	Market	volatility,	including	foreign	currency	exchange	rates,	increases the	uncertainty	inherent	in	our	estimates	and	assumptions.	As	future	events	and	their	effects	cannot	be	determined	with	precision,	actual	results	could	differ	significantly from	estimates.	If	actual	amounts	differ	from	estimates,	we	include	the	revisions	in	our	consolidated	results	of	operations	in	the	period	the	actual	amounts	become	known. Historically,	the	aggregate	differences,	if	any,	between	our	estimates	and	actual	amounts	in	any	year	have	not	had	a	material	effect	on	our	consolidated	financial statements.

# Reclassifications

We	made	reclassifications	to	certain	previously	reported	financial	information	to	conform	to	our	current	period	presentation.

# Note	2.	Restatement	of	Previously	Issued	Consolidated	Financial	Statements

We	have	restated	herein	our	audited	consolidated	financial	statements	at	December	30,	2017	and	for	the	years	ended	December	30,	2017	and	December	31,	2016.	We have	also	restated	impacted	amounts	within	the	accompanying	footnotes	to	the	consolidated	financial	statements.

As	 previously	 disclosed	 on	 February	 21,	 2019,	 we	 received	 a	 subpoena	 from	 the	 Securities	 and	 Exchange	 Commission	 ("SEC")	 in	 October	 2018	related	 to	 our procurement	area,	specifically	the	accounting	policies,	procedures,	and	internal	controls	related	to	our	procurement	function,	including,	but	not	limited	to,	agreements, side	agreements,	and	changes	or	modifications	to	agreements	with	our	suppliers.	Following	the	receipt	of	this	subpoena,	we,	together	with	external	counsel	and	forensic accountants,	and	subsequently,	under	the	oversight	of	the	Audit	Committee	of	our	Board	of	Directors	(the	"Audit	Committee"),	conducted	an	internal	investigation	into the	procurement	area	and	related	matters.	As	a	result	of	 the	findings	from	 this	 internal	 investigation,	which	 is	now	complete	and	which	 identified	 that	multiple employees	in	the	procurement	area	engaged	in	misconduct,	we	corrected	prior	period	misstatements	that	generally	increased	the	total	cost	of	products	sold	in	prior financial	periods.	These	misstatements	principally	related	to	the	incorrect	timing	of	when	certain	cost	and	rebate	elements	associated	with	supplier	contracts	and	related arrangements	were	initially	recognized.

In	connection	with	the	internal	investigation,	we	also	conducted	a	comprehensive	review	of	supplier	contracts	and	related	arrangements	to	identify	other	potential misstatements	in	the	timing	of	the	recognition	of	supplier	rebates,	incentive	payments,	and	pricing	arrangements.	The	review	identified	further	misstatements,	which	we also	investigated	and	have	been	unable	to	conclude	if	they	resulted	from	the	misconduct	described	above.	These	misstatements	are	described	in	more	detail	in	restatement reference	(a)	below.

Our	internal	investigation	and	review	identified	adjustments	that	resulted	in	an	understatement	of	cost	of	products	sold	totaling	$208	million,	including	misstatements	of $175	million	relating	to	the	periods	up	through	September	29,	2018	that	are	being	restated	in	this	Annual	Report	on	Form	10-K.	The	misstatements	of	cost	of	products sold	related	to	our	internal	investigation	and	review	included	$22	million	for	fiscal	year	2018,	$94	million	for	fiscal	year	2017,	$35	million	for	fiscal	year	2016,	and	$24 million	for	fiscal	year	2015.	We	do	not	believe	that	the	misstatements	are	quantitatively	material	to	any	period	presented	in	our	prior	financial	statements.	However,	due to	the	qualitative	nature	of	the	matters	identified	in	our	internal	investigation,	including	the	number	of	years	over	which	the	misconduct	occurred	and	the	number	of transactions,	 suppliers,	 and	 procurement	 employees	 involved,	 we	 determined	 that	 it	 would	 be	 appropriate	 to	 correct	 the	 misstatements	 in	 our	 previously	 issued consolidated	financial	statements	by	restating	such	financial	statements.	The	restatement	also	included	corrections	for	additional	identified	out-of-period	and	uncorrected misstatements	in	the	impacted	periods.

Accordingly,	we	have	restated	herein	our	consolidated	financial	statements	at	December	30,	2017	and	for	the	fiscal	years	ended	December	30,	2017	and	December	31, 2016,	in	accordance	with	Accounting	Standards	Codification	("ASC")	Topic	250,	Accounting	Changes	and	Error	Corrections.	In	addition	to	the	misstatements	related	to the	supplier	contracts	and	related	arrangements,	including	the	misstatements	related	to	lease	classification	described	in	restatement	reference	(b)	below,	we	corrected additional	identified	out-of-period	and	uncorrected	misstatements	that	were	not	material,	individually	or	in	the	aggregate,	to	our	consolidated	financial	statements.	These misstatements	 were	 related	 to	 customer	 incentive	 program	 expense	 misclassifications,	 balance	 sheet	 misclassifications,	 income	 taxes,	 impairments,	 and	 other misstatements,	all	of	which	are	described	in	more	detail	in	restatement	references	(c)	through	(g)	below.

The	restated	interim	financial	information	for	the	relevant	unaudited	interim	financial	information	for	the	quarterly	periods	ended	September	29,	2018,	June	30,	2018, March	31,	2018,	December	30,	2017,	September	30,	2017,	July	1,	2017,	and	April	1,	2017,	is	included	in	Note	23,	Quarterly	Financial	Information	(Unaudited).	The categories	of	misstatements	and	their	impact	on	our	previously	issued	consolidated	financial	statements	are	described	in	more	detail	below.

# Description	of	Misstatements

# Misstatements	Associated	with	Supplier	Contracts	and	Related	Arrangements

# (a)	Supplier	Rebates

We	recorded	adjustments	to	correct	the	misstatements	found	as	a	result	of	the	internal	investigation	related	to	procurement	described	above.	In	connection	with	the internal	investigation,	we	also	conducted	a	comprehensive	review	of	supplier	contracts	and	related	arrangements	to	identify	other	potential	misstatements	in	the	timing	of the	recognition	of	supplier	rebates,	incentive	payments,	and	pricing	arrangements.	The	review	identified	further	misstatements,	which	we	also	investigated	and	have	been unable	 to	 conclude	 if	 they	 resulted	 from	 the	 misconduct	 described	 above.	These	 misstatements	 were	 primarily	 related	 to	 certain	 supplier	 contracts	 and	 related arrangements	where	the	allocation	of	value	of	all	or	a	portion	of	rebates	and	up-front	payments	to	contractual	elements	in	the	current	period	should	have	been	deferred and	recognized	over	an	applicable	contractual	period.	We	corrected	these	misstatements	to	defer	the	up-front	consideration	from	suppliers	when	the	retention	or	receipt of	that	consideration	was	contingent	upon	future	events	and	to	correctly	recognize	the	consideration	as	a	reduction	of	cost	of	products	sold	over	the	terms	of	the arrangements	with	the	suppliers.	The	impacts	of	the	supplier	rebate	misstatements	on	each	period	are	discussed	in	restatement	reference	(a)	throughout	this	note	and	in Note	23,	Quarterly	Financial	Data	(Unaudited).

# (b)	Capital	Leases

As	part	of	our	review	of	supplier	contracts	and	related	arrangements	in	connection	with	the	internal	investigation,	we	evaluated	additional	elements	of	such	arrangements, including	the	classification	of	embedded	lease	provisions	as	capital	or	operating.	We	had	initially	classified	certain	embedded	lease	provisions	as	capital	leases	and allocated	their	fixed	consideration	to	the	lease	components.	As	a	result	of	our	analysis,	and	also	taking	into	consideration,	among	other	elements,	the	total	value	of supplier	contracts	and	related	arrangements,	we	determined	that	the	classification	of	the	embedded	lease	element	for	certain	contracts	should	have	been	classified	as	an operating	lease	instead	of	a	capital	lease.	In	addition,	we	identified	certain	arrangements	that	were	improperly	accounted	for	as	embedded	capital	leases.	The	impacts	of the	capital	lease	misstatements	on	each	period	are	discussed	in	restatement	reference	(b)	throughout	this	note	and	in	Note	23,	Quarterly	Financial	Data	(Unaudited).

# Additional	Misstatements

# (c)	Customer	Incentive	Program	Expense	Misclassifications

As	previously	disclosed	in	March	2018,	we	retrospectively	corrected	immaterial	misclassifications	in	our	statements	of	income	principally	related	to	customer	incentive program	expense	misclassifications.	The	impacts	of	the	customer	incentive	program	expense	misclassifications	on	each	period	are	discussed	in	restatement	reference	(c) throughout	this	note	and	in	Note	23,	Quarterly	Financial	Data	(Unaudited).

# (d)	Balance	Sheet	Misclassifications

We	recorded	adjustments	to	recognize	certain	balance	sheet	misclassifications	in	the	correct	period.	These	adjustments	primarily	related	to	the	classification	of	state income	taxes,	capital	expenditures,	and	the	classification	of	products	held	at	co-packer	locations.	The	impacts	of	the	balance	sheet	misclassifications	on	each	period	are discussed	in	restatement	reference	(d)	throughout	this	note	and	in	Note	23,	Quarterly	Financial	Data	(Unaudited).

# (e)	Income	Taxes

We	recorded	adjustments	to	recognize	certain	income	tax	items	in	the	correct	period,	primarily	deferred	tax	adjustments	related	to	a	Brazilian	subsidiary,	as	well	as return-to-provision	adjustments	and	various	other	misclassifications.	The	income	tax	impacts	of	all	misstatements	outside	of	this	category	are	included	in	their	respective misstatement	categories.	The	impacts	of	income	tax	misstatements	on	each	period	are	discussed	in	restatement	reference	(e)	throughout	this	note	and	in	Note	23, Quarterly	Financial	Data	(Unaudited).

# (f)	Impairments

We	recorded	an	adjustment	to	recognize	certain	non-cash	impairment	losses	in	the	correct	period.	In	2018,	we	had	determined	that	a	definite-lived	intangible	asset	had been	impaired	in	the	fourth	quarter	of	2016	due	to	a	license	termination	in	that	period	and	recorded	an	out-of-period	correction	to	recognize	the	non-cash	impairment	loss. In	addition,	we	recorded	an	adjustment	to	correct	goodwill	impairment	losses	related	to	our	Australia	and	New	Zealand	reporting	unit,	which	had	been	overstated.	The impacts	of	the	impairment	misstatements	on	each	period	are	discussed	in	restatement	reference	(f)	throughout	this	note	and	in	Note	23,	Quarterly	Financial	Data (Unaudited).

# (g)	Other

We	 recorded	 adjustments	 to	 correct	 other	 identified	 out-of-period	 and	 uncorrected	 misstatements	 that	 were	 not	 material,	 individually	 or	 in	 the	 aggregate,	 to	 our consolidated	financial	statements.	These	other	misstatements	were	primarily	related	to	structured	payable	and	product	financing	arrangements,	postemployment	benefit plans,	inventory	write-offs,	certain	accrued	liabilities,	and	other	misstatements	within	net	sales	and	certain	income	tax	and	balance	sheet	accounts.	The	impacts	of	the other	misstatements	on	each	period	are	discussed	in	restatement	reference	(g)	throughout	this	note	and	in	Note	23,	Quarterly	Financial	Data	(Unaudited).

# Description	of	Restatement	Tables

The	following	tables	represent	our	restated	consolidated	statements	of	income,	statements	of	comprehensive	income,	statements	of	equity,	and	statements	of	cash	flows for	the	years	ended	December	30,	2017	and	December	31,	2016,	as	well	as	our	restated	consolidated	balance	sheet	at	December	30,	2017.

Following	the	restated	consolidated	financial	statement	tables,	we	have	presented	a	reconciliation	from	our	prior	periods	as	previously	reported	to	the	restated	values. The	values	as	previously	reported	for	fiscal	years	2017	and	2016	were	derived	from	our	Annual	Report	on	Form	10-K	for	the	fiscal	year	ended	December	30,	2017	filed on	February	16,	2018.

In	addition,	the	statements	of	income	for	fiscal	years	2017	and	2016,	as	previously	reported,	did	not	originally	reflect	the	adoption	of	accounting	standards	update ("ASU")	2017-07	related	to	the	presentation	of	net	periodic	benefit	cost	(pension	and	postretirement	cost).	This	ASU	was	adopted	in	the	first	quarter	of	2018	and	was applied	retrospectively	for	statement	of	income	presentation	of	service	cost	components	and	other	net	periodic	benefit	cost	components.	The	restated	statements	of income	for	fiscal	years	2017	and	2016	reflect	the	retrospective	application	of	ASU	2017-07	and	are	labeled	"As	Recast."	See	Note	4,	New	Accounting	Standards,	for additional	information	related	to	our	adoption	of	ASU	2017-07.

# Consolidated	Statement	of	Income

|  |  |  | For	the	Year	Ended	December	30,	2017 | For	the	Year	Ended	December	30,	2017 |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated | ASU\tAdoption\nImpacts | As\tRestated\t&amp;\nRecast |
| Net\tsales | $26,232 | $(156) | (c)(g) | $26,076 | $— | $26,076 |
| Cost\tof\tproducts\tsold | 16,529 | (44) | (a)(b)(c)(g) | 16,485 | 558 | 17,043 |
| Gross\tprofit | 9,703 | (112) |  | 9,591 | (558) | 9,033 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\nimpairment\tlosses | 2,881 | (32) | (c)(g) | 2,849 | 78 | 2,927 |
| Goodwill\timpairment\tlosses | — | — |  | — | — | — |
| Intangible\tasset\timpairment\tlosses | 49 | — | (f) | 49 | — | 49 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 2,930 | (32) |  | 2,898 | 78 | 2,976 |
| Operating\tincome/(loss) | 6,773 | (80) |  | 6,693 | (636) | 6,057 |
| Interest\texpense | 1,234 | — | (b)(g) | 1,234 | — | 1,234 |
| Other\texpense/(income),\tnet | 9 | — |  | 9 | (636) | (627) |
| Income/(loss)\tbefore\tincome\ttaxes | 5,530 | (80) |  | 5,450 | — | 5,450 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | (5,460) | (22) | (a)(b)(e)(f)(g) | (5,482) | — | (5,482) |
| Net\tincome/(loss) | 10,990 | (58) |  | 10,932 | — | 10,932 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (9) | — |  | (9) | — | (9) |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 10,999 | (58) |  | 10,941 | — | 10,941 |
| Preferred\tdividends | — | — |  | — | — | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $10,999 | $(58) |  | $10,941 | $— | $10,941 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |  |  |
| Basic\tearnings/(loss) | $9.03 | $(0.05) |  | $8.98 | $— | $8.98 |
| Diluted\tearnings/(loss) | 8.95 | (0.04) |  | 8.91 | — | 8.91 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$94	million	and	an	increase	to	benefit	from	income	taxes of	$18	million	for	the	year	ended	December	30,	2017.

(b)	Capital	Leases—The	correction	of	these	misstatements	resulted	in	a	decrease	to	cost	of	products	sold	of	less	than	$1	million,	a	decrease	to	interest	expense	of	less than	$1	million,	and	a	decrease	to	benefit	from	income	taxes	of	less	than	$1	million	for	the	year	ended	December	30,	2017.

(c)	Customer	Incentive	Program	Expense	Misclassifications—As	previously	disclosed	in	March	2018,	the	correction	of	these	misstatements	resulted	in	a	decrease	to	net sales	of	$147	million,	a	decrease	to	cost	of	products	sold	of	$139	million,	and	a	decrease	to	selling,	general	and	administrative	expenses	("SG&A")	of	$8	million	for	the year	ended	December	30,	2017.

# (d)	Balance	Sheet	Misclassifications—None.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	benefit	from	income	taxes	of	$12	million	for	the	year	ended	December	30,	2017.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	SG&A	of	less	than	$1	million	and	a	decrease	to	benefit	from	income	taxes	of	less	than $1	million	for	the	year	ended	December	30,	2017.

(g)	Other—The	correction	of	these	misstatements	resulted	in	a	decrease	to	net	sales	of	$9	million,	an	increase	to	cost	of	products	sold	of	$1	million,	a	decrease	to	SG&A of	$24	million,	a	decrease	to	interest	expense	of	less	than	$1	million,	and	a	decrease	to	benefit	from	income	taxes	of	$8	million	for	the	year	ended	December	30,	2017.

The	values	as	previously	reported	for	the	year	ended	December	30,	2017	were	derived	from	our	Annual	Report	on	Form	10-K	for	the	year	ended	December	30,	2017 filed	on	February	16,	2018.

|  |  |  | For	the	Year	Ended	December	31,	2016 | For	the	Year	Ended	December	31,	2016 |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated | ASU\tAdoption\nImpacts | As\tRestated\t&amp;\nRecast |
| Net\tsales | $26,487 | $(187) | (c)(g) | $26,300 | $— | $26,300 |
| Cost\tof\tproducts\tsold | 16,901 | (116) | (a)(c)(g) | 16,785 | 369 | 17,154 |
| Gross\tprofit | 9,586 | (71) |  | 9,515 | (369) | 9,146 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\nimpairment\tlosses | 3,444 | (5) | (c)(g) | 3,439 | 88 | 3,527 |
| Goodwill\timpairment\tlosses | — | — |  | — | — | — |
| Intangible\tasset\timpairment\tlosses | — | 18 | (f) | 18 | — | 18 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 3,444 | 13 |  | 3,457 | 88 | 3,545 |
| Operating\tincome/(loss) | 6,142 | (84) |  | 6,058 | (457) | 5,601 |
| Interest\texpense | 1,134 | — | (g) | 1,134 | — | 1,134 |
| Other\texpense/(income),\tnet | (15) | — | (g) | (15) | (457) | (472) |
| Income/(loss)\tbefore\tincome\ttaxes | 5,023 | (84) |  | 4,939 | — | 4,939 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | 1,381 | (48) | (a)(e)(f)(g) | 1,333 | — | 1,333 |
| Net\tincome/(loss) | 3,642 | (36) |  | 3,606 | — | 3,606 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | 10 | — |  | 10 | — | 10 |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 3,632 | (36) |  | 3,596 | — | 3,596 |
| Preferred\tdividends | 180 | — |  | 180 | — | 180 |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $3,452 | $(36) |  | $3,416 | $— | $3,416 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |  |  |
| Basic\tearnings/(loss) | $2.84 | $(0.03) |  | $2.81 | $— | $2.81 |
| Diluted\tearnings/(loss) | 2.81 | (0.03) |  | 2.78 | — | 2.78 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$35	million	and	a	decrease	to	provision	for	income	taxes of	$13	million	for	the	year	ended	December	31,	2016.

# (b)	Capital	Leases—None.

(c)	Customer	Incentive	Program	Expense	Misclassifications—As	previously	disclosed	in	March	2018,	the	correction	of	these	misstatements	resulted	in	a	decrease	to	net sales	of	$152	million,	a	decrease	to	cost	of	products	sold	of	$145	million,	and	a	decrease	to	SG&A	of	$7	million	for	the	year	ended	December	31,	2016.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	a	decrease	to	provision	for	income	taxes	of	$18	million	for	the	year	ended	December	31,	2016.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	an	increase	to	SG&A	of	$18	million	and	a	decrease	to	provision	for	income	taxes	of	$4	million	for	the year	ended	December	31,	2016.

(g)	Other—The	correction	of	these	misstatements	resulted	in	a	decrease	to	net	sales	of	$35	million,	a	decrease	to	cost	of	products	sold	of	$6	million,	an	increase	to	SG&A of	$2	million,	a	decrease	to	interest	expense	of	less	than	$1	million,	a	decrease	to	other	expense/(income),	net,	of	less	than	$1	million,	and	a	decrease	to	provision	for income	taxes	of	$13	million	for	the	year	ended	December	31,	2016.

The	values	as	previously	reported	for	the	year	ended	December	31,	2016	were	derived	from	our	Annual	Report	on	Form	10-K	for	the	year	ended	December	30,	2017 filed	on	February	16,	2018.

# Consolidated	Statement	of	Comprehensive	Income

|  |  | For	the	Year	Ended	December	30,	2017 | For	the	Year	Ended	December	30,	2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $10,990 | $(58) | (a)(b)(e)(f)(g) | $10,932 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | 1,184 | 1 | (b)(e) | 1,185 |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | (353) | — |  | (353) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | — | — |  | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | (113) | — |  | (113) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | 85 | — |  | 85 |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | 69 | — |  | 69 |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | 17 | — |  | 17 |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (309) | — |  | (309) |
| Total\tother\tcomprehensive\tincome/(loss) | 580 | 1 |  | 581 |
| Total\tcomprehensive\tincome/(loss) | 11,570 | (57) |  | 11,513 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (3) | — |  | (3) |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $11,573 | $(57) |  | $11,516 |

The	$58	million	decrease	to	net	income	was	primarily	driven	by	misstatements	in	the	supplier	rebates	category,	partially	offset	by	misstatements	in	the	income	taxes, other,	impairments,	and	capital	leases	categories.	See	additional	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	year	ended December	30,	2017	section	above.

The	$1	million	increase	to	foreign	currency	translation	adjustments	is	the	result	of	misstatements	in	the	capital	leases	and	income	taxes	categories.

|  |  | For	the	Year	Ended	December	31,	2016 | For	the	Year	Ended	December	31,	2016 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $3,642 | $(36) | (a)(e)(f)(g) | $3,606 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | (986) | 7 | (d)(g)(e) | (979) |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | 226 | — |  | 226 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | — | — |  | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | 46 | — |  | 46 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | (87) | — |  | (87) |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | (40) | — |  | (40) |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | 97 | (66) | (g) | 31 |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (207) | 3 | (g) | (204) |
| Total\tother\tcomprehensive\tincome/(loss) | (951) | (56) |  | (1,007) |
| Total\tcomprehensive\tincome/(loss) | 2,691 | (92) |  | 2,599 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | 16 | — |  | 16 |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $2,675 | $(92) |  | $2,583 |

The	$36	million	decrease	to	net	income	was	primarily	driven	by	the	misstatements	in	the	other,	supplier	rebates,	and	impairments	categories,	partially	offset	by	the misstatements	in	the	income	taxes	category.	See	additional	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	year	ended	December 31,	2016	section	above.

The	$7	million	 increase	 to	 foreign	 currency	 translation	 adjustments	 is	 primarily the	 result	 of	 misstatements in the	 balance	 sheet	 misclassifications	 and the	 other misstatements	categories,	partially	offset	by	misstatements	in	the	income	taxes	category.

The	$66	million	decrease	to	prior	service	credits	arising	during	the	period	and	the	$3	million	increase	to	net	postemployment	benefit	gains	reclassified	to	net	income	are the	result	of	misstatements	in	the	other	category.

|  | As	Previously<br>Reported | December	30,	2017<br>Restatement<br>Impacts | Restatement<br>Reference | As	Restated |
| :--- | :--- | :--- | :--- | :--- |
| ASSETS |  |  |  |  |
| Cash\tand\tcash\tequivalents | $1,629 | $— |  | $1,629 |
| Trade\treceivables\t(net\tof\tallowances\tof\t$23\tat\tDecember\t30,\t2017) | 921 | — |  | 921 |
| Sold\treceivables | 353 | — |  | 353 |
| Income\ttaxes\treceivable | 582 | (44) | (a)(b)(d)(e)(g) | 538 |
| Inventories | 2,815 | (55) | (d)(g) | 2,760 |
| Prepaid\texpenses | 345 | — |  | 345 |
| Other\tcurrent\tassets | 621 | 34 | (a)(d) | 655 |
| Total\tcurrent\tassets | 7,266 | (65) |  | 7,201 |
| Property,\tplant\tand\tequipment,\tnet | 7,120 | (59) | (b)(d)(g) | 7,061 |
| Goodwill | 44,824 | 1 | (g) | 44,825 |
| Intangible\tassets,\tnet | 59,449 | (17) | (f) | 59,432 |
| Other\tnon-current\tassets | 1,573 | — |  | 1,573 |
| TOTAL\tASSETS | $120,232 | $(140) |  | $120,092 |
| LIABILITIES\tAND\tEQUITY |  |  |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $460 | $2 | (g) | $462 |
| Current\tportion\tof\tlong-term\tdebt | 2,743 | (10) | (b)(g) | 2,733 |
| Trade\tpayables | 4,449 | (87) | (d)(g) | 4,362 |
| Accrued\tmarketing | 680 | 9 | (g) | 689 |
| Interest\tpayable | 419 | — |  | 419 |
| Other\tcurrent\tliabilities | 1,381 | 108 | (a)(d)(g) | 1,489 |
| Total\tcurrent\tliabilities | 10,132 | 22 |  | 10,154 |
| Long-term\tdebt | 28,333 | (25) | (b) | 28,308 |
| Deferred\tincome\ttaxes | 14,076 | (37) | (a)(d)(e)(f)(g) | 14,039 |
| Accrued\tpostemployment\tcosts | 427 | — |  | 427 |
| Other\tnon-current\tliabilities | 1,017 | 71 | (a) | 1,088 |
| TOTAL\tLIABILITIES | 53,985 | 31 |  | 54,016 |
| Commitments\tand\tContingencies |  |  |  |  |
| Redeemable\tnoncontrolling\tinterest | 6 | — |  | 6 |
| Equity: |  |  |  |  |
| outstanding\tat\tDecember\t30,\t2017) | 12 | — |  | 12 |
| Additional\tpaid-in\tcapital | 58,711 | (77) | (d) | 58,634 |
| Retained\tearnings/(deficit) | 8,589 | (94) | (a)(b)(d)(e)(f)(g) | 8,495 |
| Accumulated\tother\tcomprehensive\tincome/(losses) | (1,054) | — |  | (1,054) |
| Treasury\tstock,\tat\tcost\t(2\tshares\tat\tDecember\t30,\t2017) | (224) | — |  | (224) |
| Total\tshareholders'\tequity | 66,034 | (171) |  | 65,863 |
| Noncontrolling\tinterest | 207 | — |  | 207 |
| TOTAL\tEQUITY | 66,241 | (171) |  | 66,070 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $120,232 | $(140) |  | $120,092 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	$1	million,	a	decrease	to	other	current	assets	of	$21 million,	an	increase	to	other	current	liabilities	of	$57	million,	a	decrease	to	deferred	income	taxes	of	$37	million,	an	increase	to	other	non-current	liabilities	of	$71 million,	and	a	decrease	to	retained	earnings	of	$113	million	at	December	30,	2017.

(b)	Capital	Leases—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	less	than	$1	million,	a	decrease	to	property,	plant	and equipment,	net,	of	$34	million,	a	decrease	to	current	portion	of	long-term	debt	of	$9	million,	a	decrease	to	long-term	debt	of	$25	million,	and	a	decrease	to	retained earnings	of	less	than	$1	million	at	December	30,	2017.

(c)	Customer	Incentive	Program	Expense	Misclassifications—None.

(d)	Balance	Sheet	Misclassifications—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	$83	million,	a	decrease	to	inventories	of $55	million,	an	increase	to	other	current	assets	of	$55	million,	a	decrease	to	property,	plant	and	equipment,	net,	of	$23	million,	a	decrease	to	trade	payables	of	$23 million,	a	decrease	to	other	current	liabilities	of	$28	million,	a	decrease	to	deferred	income	taxes	of	$55	million,	a	decrease	to	additional	paid-in	capital	of	$77	million, and	an	increase	to	retained	earnings	of	$77	million	at	December	30,	2017.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	$33	million,	an	increase	to	deferred	income	taxes	of	$58 million,	and	a	decrease	to	retained	earnings	of	$25	million	at	December	30,	2017.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	intangible	assets,	net,	of	$17	million,	a	decrease	to	deferred	income	taxes	of	$4	million, and	a	decrease	to	retained	earnings	of	$13	million	at	December	30,	2017.

(g)	Other—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	$7	million,	a	decrease	to	inventories	of	less	than	$1	million,	a decrease	to	property,	plant	and	equipment,	net,	of	$2	million,	an	increase	to	goodwill	of	$1	million,	an	increase	to	commercial	paper	and	other	short-term	debt	of	$2 million,	a	decrease	to	current	portion	of	long-term	debt	of	$1	million,	a	decrease	to	trade	payables	of	$64	million,	an	increase	to	accrued	marketing	of	$9	million,	an increase	to	other	current	liabilities	of	$79	million,	an	increase	to	deferred	income	taxes	of	$1	million,	and	a	decrease	to	retained	earnings	of	$20	million	at	December	30, 2017.

# Consolidated	Statement	of	Equity

|  | Restatement<br>Reference | Common	Stock | Additional<br>Paid-in<br>Capital | Retained<br>Earnings/(Deficit) | Accumulated	Other<br>Comprehensive<br>Income/(Losses) | Treasury<br>Stock,	at	Cost | Noncontrolling	Interest | Total	Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| As\tPreviously\tReported |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t31,\t2016 |  | $12 | $58,593 | $588 | $(1,628) | $(207) | $216 | $57,574 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest |  | — | — | 10,999 | — | — | (5) | 10,994 |
| Other\tcomprehensive\tincome/(loss) |  | — | — | — | 574 | — | 6 | 580 |
| Dividends\tdeclared-common\tstock\t($2.45\nper\tshare) |  | — | — | (2,988) | — | — | — | (2,988) |
| Dividends\tdeclared-noncontrolling\tinterest\n($52.75\tper\tshare) |  | — | — | — | — | — | (10) | (10) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 118 | (10) | — | (17) | — | 91 |
| Balance\tat\tDecember\t30,\t2017 |  | $12 | $58,711 | $8,589 | $(1,054) | $(224) | $207 | $66,241 |
| Restatement\tImpacts |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t31,\t2016 |  | $— | $(77) | $(36) | $(1) | $— | $— | $(114) |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest | (a)(b)(e)(f)(g) | — | — | (58) | — | — | — | (58) |
| Other\tcomprehensive\tincome/(loss) | (b)(e) | — | — | — | 1 | — | — | 1 |
| Dividends\tdeclared-common\tstock\t($2.45\nper\tshare) |  | — | — | — | — | — | — | — |
| Dividends\tdeclared-noncontrolling\tinterest\n($52.75\tper\tshare) |  | — | — | — | — | — | — | — |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | — | — | — | — | — | — |
| Balance\tat\tDecember\t30,\t2017 |  | $— | $(77) | $(94) | $— | $— | $— | $(171) |
| As\tRestated |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t31,\t2016 |  | $12 | $58,516 | $552 | $(1,629) | $(207) | $216 | $57,460 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest |  | — | — | 10,941 | — | — | (5) | 10,936 |
| Other\tcomprehensive\tincome/(loss) |  | — | — | — | 575 | — | 6 | 581 |
| Dividends\tdeclared-common\tstock\t($2.45\nper\tshare) |  | — | — | (2,988) | — | — | — | (2,988) |
| Dividends\tdeclared-noncontrolling\tinterest\n($52.75\tper\tshare) |  | — | — | — | — | — | (10) | (10) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 118 | (10) | — | (17) | — | 91 |
| Balance\tat\tDecember\t30,\t2017 |  | $12 | $58,634 | $8,495 | $(1,054) | $(224) | $207 | $66,070 |

See	descriptions	of	the	net	income	and	other	comprehensive	income	impacts	in	the	consolidated	statement	of	income	and	consolidated	statement	of	comprehensive income	for	the	year	ended	December	30,	2017	sections	above.

|  | Restatement<br>Reference | Common	Stock | Additional<br>Paid-in<br>Capital | Retained<br>Earnings/(Deficit) | Accumulated	Other<br>Comprehensive<br>Income/(Losses) | Treasury<br>Stock,	at	Cost | Noncontrolling	Interest | Total	Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| As\tPreviously\tReported |  |  |  |  |  |  |  |  |
| Balance\tat\tJanuary\t3,\t2016 |  | $12 | $58,375 | $— | $(671) | $(31) | $208 | $57,893 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest |  | — | — | 3,632 | — | — | 10 | 3,642 |
| Other\tcomprehensive\tincome/(loss) |  |  |  |  |  |  |  |  |
| excluding\tredeemable\tnoncontrolling |  |  |  |  |  |  |  |  |
| interest |  | — | — | — | (957) | — | 6 | (951) |
| Dividends\tdeclared-Series\tA\tPreferred\nStock\t($2,250.00\tper\tshare) |  | — | — | (180) | — | — | — | (180) |
| Dividends\tdeclared-common\tstock\t($2.35\nper\tshare) |  | — | — | (2,862) | — | — | — | (2,862) |
| Dividends\tdeclared-noncontrolling\tinterest\n($90.82\tper\tshare) |  | — | — | — | — | — | (8) | (8) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 218 | (2) | — | (176) | — | 40 |
| Balance\tat\tDecember\t31,\t2016 |  | $12 | $58,593 | $588 | $(1,628) | $(207) | $216 | $57,574 |
| Restatement\tImpacts |  |  |  |  |  |  |  |  |
| Balance\tat\tJanuary\t3,\t2016 | (a)(d)(e)(g) | $— | $(77) | $— | $55 | $— | $— | $(22) |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest | (a)(e)(f)(g) | — | — | (36) | — | — | — | (36) |
| Other\tcomprehensive\tincome/(loss) |  |  |  |  |  |  |  |  |
| excluding\tredeemable\tnoncontrolling |  |  |  |  |  |  |  |  |
| interest | (g) | — | — | — | (56) | — | — | (56) |
| Dividends\tdeclared-Series\tA\tPreferred\nStock\t($2,250.00\tper\tshare) |  | — | — | — | — | — | — | — |
| Dividends\tdeclared-common\tstock\t($2.35\nper\tshare) |  | — | — | — | — | — | — | — |
| Dividends\tdeclared-noncontrolling\tinterest\n($90.82\tper\tshare) |  | — | — | — | — | — | — | — |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | — | — | — | — | — | — |
| Balance\tat\tDecember\t31,\t2016 |  | $— | $(77) | $(36) | $(1) | $— | $— | $(114) |
| As\tRestated |  |  |  |  |  |  |  |  |
| Balance\tat\tJanuary\t3,\t2016 |  | $12 | $58,298 | $— | $(616) | $(31) | $208 | $57,871 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest |  | — | — | 3,596 | — | — | 10 | 3,606 |
| Other\tcomprehensive\tincome/(loss) |  |  |  |  |  |  |  |  |
| excluding\tredeemable\tnoncontrolling |  |  |  |  |  |  |  |  |
| interest |  | — | — | — | (1,013) | — | 6 | (1,007) |
| Dividends\tdeclared-Series\tA\tPreferred\nStock\t($2,250.00\tper\tshare) |  | — | — | (180) | — | — | — | (180) |
| Dividends\tdeclared-common\tstock\t($2.35\nper\tshare) |  | — | — | (2,862) | — | — | — | (2,862) |
| Dividends\tdeclared-noncontrolling\tinterest\n($90.82\tper\tshare) |  | — | — | — | — | — | (8) | (8) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 218 | (2) | — | (176) | — | 40 |
| Balance\tat\tDecember\t31,\t2016 |  | $12 | $58,516 | $552 | $(1,629) | $(207) | $216 | $57,460 |

The	$77	million	decrease	to	additional	paid-in	capital	was	primarily	driven	by	the	misstatements	in	the	income	taxes,	supplier	rebates,	and	other	categories,	which resulted	in	a	decrease	to	net	income	for	the	fiscal	year	ended	January	3,	2016,	which	has	been	reflected	as	a	reduction	to	additional	paid-in	capital	rather	than	retained earnings	due	to	certain	dividends	declared	in	2015	without	a	corresponding	amount	in	retained	earnings.

The	$55	million	decrease	to	accumulated	other	comprehensive	losses	at	January	3,	2016	was	primarily	driven	by	the	misstatements	in	the	other	and	income	taxes categories,	partially	offset	by	the	misstatements	in	the	balance	sheet	reclassifications	category.

See	descriptions	of	the	net	income	and	other	comprehensive	income	impacts	in	the	consolidated	statement	of	income	and	consolidated	statement	of	comprehensive income	for	the	year	ended	December	31,	2016	sections	above.

# Consolidated	Statement	of	Cash	Flows

|  |  | For	the	Year	Ended	December	30,	2017 | For	the	Year	Ended	December	30,	2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES: |  |  |  |  |
| Net\tincome/(loss) | $10,990 | $(58) | (a)(b)(e)(f)(g) | $10,932 |
| Adjustments\tto\treconcile\tnet\tincome/(loss)\tto\toperating\tcash\tflows: |  |  |  |  |
| Depreciation\tand\tamortization | 1,036 | (5) | (b)(f)(g) | 1,031 |
| Amortization\tof\tpostretirement\tbenefit\tplans\tprior\tservice\tcosts/(credits) | (328) | — |  | (328) |
| Equity\taward\tcompensation\texpense | 46 | — |  | 46 |
| Deferred\tincome\ttax\tprovision/(benefit) | (6,467) | (28) | (a)(e)(g) | (6,495) |
| Postemployment\tbenefit\tplan\tcontributions | (1,659) | — |  | (1,659) |
| Goodwill\tand\tintangible\tasset\timpairment\tlosses | 49 | — |  | 49 |
| Nonmonetary\tcurrency\tdevaluation | 36 | — |  | 36 |
| Other\titems,\tnet | 219 | 34 | (a)(g) | 253 |
| Changes\tin\tcurrent\tassets\tand\tliabilities: | — | — |  |  |
| Trade\treceivables | (2,629) | — |  | (2,629) |
| Inventories | (251) | 15 | (d) | (236) |
| Accounts\tpayable | 464 | (23) | (d) | 441 |
| Other\tcurrent\tassets | (67) | 3 | (a)(d) | (64) |
| Other\tcurrent\tliabilities | (912) | 36 | (a)(e)(g) | (876) |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | 527 | (26) |  | 501 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES: |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | 2,286 | — |  | 2,286 |
| Capital\texpenditures | (1,217) | 23 | (d) | (1,194) |
| Payments\tto\tacquire\tbusiness,\tnet\tof\tcash\tacquired | — | — |  | — |
| Other\tinvesting\tactivities,\tnet | 87 | (2) | (g) | 85 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 1,156 | 21 |  | 1,177 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES: |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | (2,644) | 3 | (b)(g) | (2,641) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | 1,496 | — |  | 1,496 |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | 6,043 | — |  | 6,043 |
| Repayments\tof\tcommercial\tpaper | (6,249) | — |  | (6,249) |
| Dividends\tpaid\t-\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Dividends\tpaid\t-\tcommon\tstock | (2,888) | — |  | (2,888) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Other\tfinancing\tactivities,\tnet | 16 | 2 | (g) | 18 |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (4,226) | 5 |  | (4,221) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\tcash | 57 | — |  | 57 |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash |  |  |  |  |
| Net\tincrease/(decrease) | (2,486) | — |  | (2,486) |
| Balance\tat\tbeginning\tof\tperiod | 4,255 | — |  | 4,255 |
| Balance\tat\tend\tof\tperiod | $1,769 | $— |  | $1,769 |
| NON-CASH\tINVESTING\tACTIVITIES: |  |  |  |  |
| Beneficial\tinterest\tobtained\tin\texchange\tfor\tsecuritized\ttrade\treceivables | $2,519 | $— |  | $2,519 |
| CASH\tPAID\tDURING\tTHE\tPERIOD\tFOR: |  |  |  |  |
| Interest | $1,269 | $— |  | $1,269 |
| Income\ttaxes | 1,206 | — |  | 1,206 |

See	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	year	ended	December	30,	2017	section	above.

The	misstatements	in	the	balance	sheet	misclassifications	category	resulted	in	a	decrease	to	net	cash	flows	provided	by	operating	activities	of	$23	million	and	an	increase to	net	cash	flows	provided	by	investing	activities	of	$23	million	for	the	year	ended	December	30,	2017.

The	misstatements	in	the	other	misclassifications	category	resulted	in	a	decrease	to	net	cash	flows	provided	by	operating	activities	of	$1	million,	a	decrease	to	net	cash flows	provided	by	investing	activities	of	$2	million,	and	an	increase	to	net	cash	flows	provided	by	financing	activities	of	$3	million	for	the	year	ended	December	30, 2017.

The	misstatements	in	the	capital	leases	misclassifications	category	resulted	in	a	decrease	to	net	cash	flows	provided	by	operating	activities	of	$2	million	and	an	increase to	net	cash	flows	provided	by	financing	activities	of	$2	million	for	the	year	ended	December	30,	2017.

No	other	misstatements	impacted	the	classifications	between	net	operating,	net	investing,	or	net	financing	cash	flow	activities	for	the	year	ended	December	30,	2017.

|  |  | For	the	Year	Ended	December	31,	2016 | For	the	Year	Ended	December	31,	2016 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES: |  |  |  |  |
| Net\tincome/(loss) | $3,642 | $(36) | (a)(e)(f)(g) | $3,606 |
| Adjustments\tto\treconcile\tnet\tincome/(loss)\tto\toperating\tcash\tflows: |  |  |  |  |
| Depreciation\tand\tamortization | 1,337 | — |  | 1,337 |
| Amortization\tof\tpostretirement\tbenefit\tplans\tprior\tservice\tcosts/(credits) | (333) | (14) | (g) | (347) |
| Equity\taward\tcompensation\texpense | 46 | — |  | 46 |
| Deferred\tincome\ttax\tprovision/(benefit) | (29) | (43) | (a)(e)(f)(g) | (72) |
| Postemployment\tbenefit\tplan\tcontributions | (494) | — |  | (494) |
| Goodwill\tand\tintangible\tasset\timpairment\tlosses | — | 18 | (f) | 18 |
| Nonmonetary\tcurrency\tdevaluation | 24 | — |  | 24 |
| Other\titems,\tnet | 16 | 9 | (a)(g) | 25 |
| Changes\tin\tcurrent\tassets\tand\tliabilities: | — | — |  |  |
| Trade\treceivables | (2,055) | — |  | (2,055) |
| Inventories | (130) | — |  | (130) |
| Accounts\tpayable | 943 | (64) | (d) | 879 |
| Other\tcurrent\tassets | (42) | 1 | (a) | (41) |
| Other\tcurrent\tliabilities | (276) | 128 | (a)(d)(e)(g) | (148) |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | 2,649 | (1) |  | 2,648 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES: |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | 2,589 | — |  | 2,589 |
| Capital\texpenditures | (1,247) | — |  | (1,247) |
| Payments\tto\tacquire\tbusiness,\tnet\tof\tcash\tacquired | — | — |  | — |
| Other\tinvesting\tactivities,\tnet | 110 | — |  | 110 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 1,452 | — |  | 1,452 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES: |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | (86) | 1 | (g) | (85) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | 6,981 | — |  | 6,981 |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | 6,680 | — |  | 6,680 |
| Repayments\tof\tcommercial\tpaper | (6,043) | — |  | (6,043) |
| Dividends\tpaid\t-\tSeries\tA\tPreferred\tStock | (180) | — |  | (180) |
| Dividends\tpaid\t-\tcommon\tstock | (3,584) | — |  | (3,584) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | (8,320) | — |  | (8,320) |
| Other\tfinancing\tactivities,\tnet | (69) | — |  | (69) |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (4,621) | 1 |  | (4,620) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\tcash | (137) | — |  | (137) |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash |  |  |  |  |
| Net\tincrease/(decrease) | (657) | — |  | (657) |
| Balance\tat\tbeginning\tof\tperiod | 4,912 | — |  | 4,912 |
| Balance\tat\tend\tof\tperiod | $4,255 | $— |  | $4,255 |
| NON-CASH\tINVESTING\tACTIVITIES: |  |  |  |  |
| Beneficial\tinterest\tobtained\tin\texchange\tfor\tsecuritized\ttrade\treceivables | $2,213 | $— |  | $2,213 |
| CASH\tPAID\tDURING\tTHE\tPERIOD\tFOR: |  |  |  |  |
| Interest | $1,176 | $— |  | $1,176 |
| Income\ttaxes | 1,619 | — |  | 1,619 |

See	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	year	ended	December	31,	2016	section	above.

The	misstatements	in	the	other	misclassifications	category	resulted	in	a	decrease	to	net	cash	flows	provided	by	operating	activities	of	$1	million	and	an	increase	to	net cash	flows	provided	by	financing	activities	of	$1	million	for	the	year	ended	December	31,	2016.

No	other	misstatements	impacted	the	classifications	between	net	operating,	net	investing,	or	net	financing	cash	flow	activities	for	the	year	ended	December	31,	2016.

# Note	3.	Significant	Accounting	Policies

Advertising	expenses	are	recorded	in	SG&A.	For	interim	reporting	purposes,	we	charge	advertising	to	operations	as	a	percentage	of	estimated	full	year	sales	activity	and marketing	costs.	We	review	and	adjust	these	estimates	each	quarter	based	on	actual	experience	and	other	information.	We	recorded	advertising	expenses	of	$584	million in	2018,	$629	million	in	2017,	and	$708	million	in	2016,	which	represented	costs	to	obtain	physical	advertisement	spots	in	television,	radio,	print,	digital,	and	social channels.	We	also	incur	other	advertising	and	marketing	costs	such	as	shopper	marketing,	sponsorships,	and	agency	advertisement	conception,	design,	and	public relations	fees.	Total	advertising	and	marketing	costs	were	$1,140	million	in	2018,	$1,115	million	in	2017,	and	$1,221	million	in	2016.

# Research	and	Development	Expense:

We	expense	costs	as	incurred	for	product	research	and	development	within	SG&A.	Research	and	development	expenses	were	approximately	$109	million	in	2018,	$93 million	in	2017,	and	$120	million	in	2016.

# Stock-Based	Compensation:

We	recognize	compensation	costs	related	to	equity	awards	on	a	straight-line	basis	over	the	vesting	period	of	the	award,	which	is	generally	five	years.	These	costs	are primarily	recognized	within	SG&A.	We	estimate	expected	forfeitures	rather	than	recognizing	forfeitures	as	they	occur	in	determining	our	equity	award	compensation costs.	We	 classify	 equity	 award	 compensation	 costs	 primarily	 within	 general	 corporate	 expenses.	 See	 Note	 12,	Employees'	 Stock	 Incentive	 Plans,	 for	 additional information.

We	maintain	various	retirement	plans	for	the	majority	of	our	employees.	These	include	pension	benefits,	postretirement	health	care	benefits,	and	defined	contribution benefits.	The	cost	of	these	plans	is	charged	to	expense	over	an	appropriate	term	based	on,	among	other	things,	the	cost	component	and	whether	the	plan	is	active	or inactive.	Changes	in	the	fair	value	of	our	plan	assets	result	in	net	actuarial	gains	or	losses.	These	net	actuarial	gains	and	losses	are	deferred	into	accumulated	other comprehensive	income/(losses)	and	amortized	within	other	expense/(income),	net	in	future	periods	using	the	corridor	approach.	The	corridor	is	10%	of	the	greater	of	the market-related	value	of	the	plan's	asset	or	projected	benefit	obligation.	Any	actuarial	gains	and	losses	in	excess	of	the	corridor	are	then	amortized	over	an	appropriate term	based	on	whether	the	plan	is	active	or	inactive.	See	Note	13,	Postemployment	Benefits,	for	additional	information.

We	recognize	income	taxes	based	on	amounts	refundable	or	payable	for	the	current	year	and	record	deferred	tax	assets	or	liabilities	for	any	difference	between	the financial	reporting	and	tax	basis	of	our	assets	and	liabilities.	We	also	recognize	deferred	tax	assets	for	temporary	differences,	operating	loss	carryforwards,	and	tax	credit carryforwards.	Inherent	in	determining	our	annual	tax	rate	are	judgments	regarding	business	plans,	planning	opportunities,	and	expectations	about	future	outcomes. Realization	of	certain	deferred	tax	assets,	primarily	net	operating	loss	and	other	carryforwards,	is	dependent	upon	generating	sufficient	taxable	income	in	the	appropriate jurisdiction	prior	to	the	expiration	of	the	carryforward	periods.

We	apply	a	more-likely-than-not	threshold	to	the	recognition	and	derecognition	of	uncertain	tax	positions.	Accordingly,	we	recognize	the	amount	of	tax	benefit	that	has	a greater	than	50	percent	likelihood	of	being	ultimately	realized	upon	settlement.	Future	changes	in	judgment	related	to	the	expected	ultimate	resolution	of	uncertain	tax positions	will	affect	our	results	in	the	quarter	of	such	change.

We	record	valuation	allowances	to	reduce	deferred	tax	assets	to	the	amount	that	is	more	likely	than	not	to	be	realized.	When	assessing	the	need	for	valuation	allowances, we	consider	future	taxable	income	and	ongoing	prudent	and	feasible	tax	planning	strategies.	Should	a	change	in	circumstances	lead	to	a	change	in	judgment	about	the realizability	of	deferred	tax	assets	in	future	years,	we	would	adjust	related	valuation	allowances	in	the	period	that	the	change	in	circumstances	occurs,	along	with	a corresponding	adjustment	to	our	provision	for/(benefit	from)	income	taxes.	The	resolution	of	tax	reserves	and	changes	in	valuation	allowances	could	be	material	to	our results	of	operations	for	any	period,	but	is	not	expected	to	be	material	to	our	financial	position.

# Common	Stock	and	Preferred	Stock	Dividends:

Dividends	are	recorded	as	a	reduction	to	retained	earnings.	When	we	have	an	accumulated	deficit,	dividends	are	recorded	as	a	reduction	of	additional	paid-in	capital.

# Cash	and	Cash	Equivalents:

Cash	equivalents	include	demand	deposits	with	banks	and	all	highly	liquid	investments	with	original	maturities	of	three	months	or	less.	Cash	and	cash	equivalents	that are	legally	restricted	as	to	withdrawal	or	usage	is	classified	in	other	current	assets	or	other	non-current	assets,	as	applicable,	on	the	consolidated	balance	sheets.

# Inventories:

Inventories	are	stated	at	the	lower	of	cost	or	net	realizable	value.	We	value	inventories	primarily	using	the	average	cost	method.

# Property,	Plant	and	Equipment:

Property,	plant	and	equipment	are	stated	at	historical	cost	and	depreciated	on	the	straight-line	method	over	the	estimated	useful	lives	of	the	assets.	Machinery	and equipment	are	depreciated	over	periods	ranging	from	three	 to	20	years	and	buildings	and	improvements	over	periods	up	to	40	years.	Capitalized	software	costs	are included	in	property,	plant	and	equipment	and	amortized	on	a	straight-line	basis	over	the	estimated	useful	lives	of	the	software,	which	do	not	exceed	seven	years.	We review	long-lived	assets	for	impairment	when	conditions	exist	that	indicate	the	carrying	amount	of	the	assets	may	not	be	fully	recoverable.	Such	conditions	could	include significant	adverse	changes	in	the	business	climate,	current-period	operating	or	cash	flow	losses,	significant	declines	in	forecasted	operations,	or	a	current	expectation that	an	asset	group	will	be	disposed	of	before	the	end	of	its	useful	life.	We	perform	undiscounted	operating	cash	flow	analyses	to	determine	if	an	impairment	exists. When	testing	for	impairment	of	assets	held	for	use,	we	group	assets	at	the	lowest	level	for	which	cash	flows	are	separately	identifiable.	If	an	impairment	is	determined	to exist,	the	loss	is	calculated	based	on	estimated	fair	value.	Impairment	losses	on	assets	to	be	disposed	of,	if	any,	are	based	on	the	estimated	proceeds	to	be	received,	less costs	of	disposal.

See	Note	10,	Goodwill	and	Intangible	Assets,	for	additional	information.

# Financial	Instruments:

As	we	source	our	commodities	on	global	markets	and	periodically	enter	into	financing	or	other	arrangements	abroad,	we	use	a	variety	of	risk	management	strategies	and financial	instruments	to	manage	commodity	price,	foreign	currency	exchange	rate,	and	interest	rate	risks.	Our	risk	management	program	focuses	on	the	unpredictability of	financial	markets	and	seeks	to	reduce	the	potentially	adverse	effects	that	the	volatility	of	these	markets	may	have	on	our	operating	results.	One	way	we	do	this	is through	actively	hedging	our	risks	through	the	use	of	derivative	instruments.	As	a	matter	of	policy,	we	do	not	use	highly	leveraged	derivative	instruments,	nor	do	we	use financial	instruments	for	speculative	purposes.

Derivatives	are	recorded	on	our	consolidated	balance	sheets	as	assets	or	liabilities	at	fair	value,	which	fluctuates	based	on	changing	market	conditions.

Certain	derivatives	are	designated	as	cash	flow	hedges	and	qualify	for	hedge	accounting	treatment,	while	others	are	not	designated	as	hedging	instruments	and	are	marked to	market	through	net	income/(loss).	The	gains	and	losses	on	cash	flow	hedges	are	deferred	as	a	component	of	accumulated	other	comprehensive	income/(losses)	and	are recognized	in	net	income/(loss)	at	the	time	the	hedged	item	affects	net	income/(loss),	in	the	same	line	item	as	the	underlying	hedged	item.	The	excluded	component	on cash	flow	hedges	is	recognized	in	net	income/(loss)	over	the	life	of	the	hedging	relationship	in	the	same	income	statement	line	item	as	the	underlying	hedged	item.	We also	designate	certain	derivatives	and	non-derivatives	as	net	investment	hedges	to	hedge	the	net	assets	of	certain	foreign	subsidiaries	which	are	exposed	to	volatility	in foreign	currency	exchange	rates.	Changes	in	the	value	of	these	derivatives	and	remeasurements	of	our	non-derivatives	designated	as	net	investment	hedges	are	calculated each	period	using	the	spot	method,	with	changes	reported	in	foreign	currency	translation	adjustment	within	accumulated	other	comprehensive	income/(losses).	Such amounts	will	remain	in	accumulated	other	comprehensive	income/(losses)	until	the	complete	or	substantially	complete	liquidation	of	our	investment	in	the	underlying foreign	operations.	The	excluded	component	on	derivatives	designated	as	net	investment	hedges	is	recognized	in	net	income/(loss)	within	interest	expense.	The	income statement	classification	of	gains	and	losses	related	to	derivative	instruments	not	designated	as	hedging	instruments	is	determined	based	on	the	underlying	intent	of	the contracts.	Cash	flows	related	to	the	settlement	of	derivative	instruments	designated	as	net	investment	hedges	of	foreign	operations	are	classified	in	the	consolidated statements	of	cash	flows	within	investing	activities.	All	other	cash	flows	related	to	derivative	instruments	are	classified	in	the	same	line	item	as	the	cash	flows	of	the related	hedged	item,	which	is	generally	within	operating	activities.

To	qualify	for	hedge	accounting,	a	specified	level	of	hedging	effectiveness	between	the	hedging	instrument	and	the	item	being	hedged	must	be	achieved	at	inception	and maintained	throughout	the	hedged	period.	When	a	hedging	instrument	no	longer	meets	the	specified	level	of	hedging	effectiveness,	we	reclassify	the	related	hedge	gains or	losses	previously	deferred	into	other	comprehensive	income/(losses)	to	net	income	within	other	expense/(income),	net.	We	formally	document	our	risk	management objectives,	our	strategies	for	undertaking	the	various	hedge	transactions,	the	nature	of	and	relationships	between	the	hedging	instruments	and	hedged	items,	and	the method	for	assessing	hedge	effectiveness.	Additionally,	for	qualified	hedges	of	forecasted	 transactions,	we	specifically	 identify	 the	significant	characteristics	and expected	terms	of	the	forecasted	transactions.	If	it	becomes	probable	that	a	forecasted	transaction	will	not	occur,	the	hedge	will	no	longer	be	effective	and	all	of	the derivative	gains	or	losses	would	be	recognized	in	net	income	in	the	current	period.

Unrealized	gains	and	losses	on	our	commodity	derivatives	not	designated	as	hedging	instruments	are	recorded	in	cost	of	products	sold	and	are	included	within	general corporate	expenses	until	realized.	Once	realized,	the	gains	and	losses	are	included	within	the	applicable	segment	operating	results.	See	Note	14,	Financial	Instruments, for	additional	information.

# Our	designated	and	undesignated	derivative	contracts	include:

•Net investment	 hedges.	We	have	numerous investments	 in	our	foreign	subsidiaries,	 the	net	assets	of	which	are	exposed	 to	volatility	 in	foreign	currency exchange	 rates.	 We	 manage	 this	 risk	 by	 utilizing	 derivative	 and	 non-derivative	 instruments,	 including	 cross-currency	 swap	 contracts,	 foreign	 exchange contracts,	and	certain	foreign	denominated	debt	designated	as	net	investment	hedges.	We	exclude	the	interest	accruals	on	cross-currency	swap	contracts	and	the forward	points	on	foreign	exchange	forward	contracts	from	the	assessment	and	measurement	of	hedge	effectiveness.	We	recognize	the	interest	accruals	on cross-currency	swap	contracts	in	net	income/(loss)	within	interest	expense.	We	amortize	the	forward	points	on	foreign	exchange	contracts	into	net	income/(loss) within	interest	expense	over	the	life	of	the	hedging	relationship.

•Foreign currency cash flow	 hedges.	We	 use	 various	 financial	 instruments	 to	 mitigate	 our	 exposure	 to	 changes	 in	 exchange	 rates	 from	 third-party	 and intercompany	 actual	 and	 forecasted	 transactions.	 Our	 principal	 foreign	 currency	 exposures	 that	 are	 hedged	 include	 the	 British	 pound	 sterling,	 euro,	 and Canadian	 dollar.	These	 instruments	 include	 cross-currency	 swap	 contracts	 and	 foreign	 exchange	 forward	 and	 option	 contracts.	 Substantially	 all	 of	 these derivative	instruments	are	highly	effective	and	qualify	for	hedge	accounting	treatment.	We	exclude	the	interest	accruals	on	cross-currency	swap	contracts	and the	forward	points	and	option	premiums	or	discounts	on	foreign	exchange	contracts	from	the	assessment	and	measurement	of	hedge	effectiveness	and	amortize such	amounts	into	net	income/(loss)	in	the	same	line	item	as	the	underlying	hedged	item	over	the	life	of	the	hedging	relationship.

•Interest	 rate	 cash flow	 hedges.	 From time	 to	 time,	 we	 have	 used	 derivative	 instruments,	 including	 interest	 rate	 swaps,	 as	 part	 of	 our	 interest	 rate	 risk management	strategy.	We	have	primarily	used	interest	rate	swaps	to	hedge	the	variability	of	interest	payment	cash	flows	on	a	portion	of	our	future	debt obligations.

•Commodity	derivatives.	We	are	exposed	to	price	risk	related	to	forecasted	purchases	of	certain	commodities	that	we	primarily	use	as	raw	materials.	We	enter into	commodity	purchase	contracts	primarily	for	dairy	products,	meat	products,	coffee	beans,	sugar,	vegetable	oils,	wheat	products,	corn	products,	and	cocoa products.	These	commodity	purchase	contracts	generally	are	not	subject	to	the	accounting	requirements	for	derivative	instruments	and	hedging	activities	under the	normal	purchases	and	normal	sales	exception.	We	also	use	commodity	futures,	options,	and	swaps	to	economically	hedge	the	price	of	certain	commodity costs,	including	the	commodities	noted	above,	as	well	as	packaging	products,	diesel	fuel,	and	natural	gas.	We	do	not	designate	these	commodity	contracts	as hedging	instruments.	We	also	occasionally	use	futures	to	economically	cross	hedge	a	commodity	exposure.

# Translation	of	Foreign	Currencies:

For	all	significant	foreign	operations,	the	functional	currency	is	the	local	currency.	Assets	and	liabilities	of	these	operations	are	translated	at	the	exchange	rate	in	effect	at each	period	end.	Income	statement	accounts	are	translated	at	the	average	rate	of	exchange	prevailing	during	the	period.	Translation	adjustments	arising	from	the	use	of differing	exchange	rates	from	period	to	period	are	included	as	a	component	of	accumulated	other	comprehensive	income/(losses)	on	the	balance	sheet.	Gains	and	losses from	foreign	currency	transactions	are	included	in	net	income/(loss)	for	the	period.

# Highly	Inflationary	Accounting:

We	apply	highly	inflationary	accounting	if	the	cumulative	inflation	rate	in	an	economy	for	a	three-year	period	meets	or	exceeds	100%.	Under	highly	inflationary accounting,	the	financial	statements	of	a	subsidiary	are	remeasured	into	our	reporting	currency	(U.S.	dollars)	based	on	the	legally	available	exchange	rate	at	which	we expect	to	settle	the	underlying	transactions.	Exchange	gains	and	losses	from	the	remeasurement	of	monetary	assets	and	liabilities	are	reflected	in	net	income/(loss),	rather than	accumulated	other	comprehensive	income/(losses)	on	the	balance	sheet,	until	such	time	as	the	economy	is	no	longer	considered	highly	inflationary.	Certain	non- monetary	assets	and	liabilities	are	recorded	at	the	applicable	historical	exchange	rates.	We	apply	highly	inflationary	accounting	to	the	results	of	our	subsidiaries	in Venezuela	and	Argentina.	The	net	monetary	assets	of	our	subsidiary	in	Argentina	were	approximately	 $2	million	 at	December	29,	2018.	 See	 Note	 16,	Venezuela	- Foreign	Currency	and	Inflation,	for	additional	information	related	to	our	subsidiary	in	Venezuela.

# Note	4.	New	Accounting	Standards

# Accounting	Standards	Adopted	in	the	Current	Year

# Presentation	of	Net	Periodic	Benefit	Costs:

In	March	2017,	 the	Financial	Accounting	Standards	Board	(the	"FASB")	issued	ASU	2017-07	related	to	the	presentation	of	net	periodic	benefit	cost	(pension	and postretirement	cost).	This	ASU	became	effective	beginning	in	the	first	quarter	of	our	fiscal	year	2018.	Under	the	new	guidance,	the	service	cost	component	of	net periodic	benefit	cost	must	be	presented	in	the	same	statement	of	income	line	item	as	other	employee	compensation	costs	arising	from	services	rendered	by	employees during	the	period.	Other	components	of	net	periodic	benefit	cost	must	be	disaggregated	from	the	service	cost	component	in	the	statements	of	income	and	must	be presented	outside	the	operating	income/(loss)	subtotal.	Additionally,	only	the	service	cost	component	is	eligible	for	capitalization	in	assets.	The	new	guidance	must	be applied	retrospectively	for	the	statement	of	income	presentation	of	service	cost	components	and	other	net	periodic	benefit	cost	components	and	prospectively	for	the capitalization	of	service	cost	components.	There	is	a	practical	expedient	that	allows	us	to	use	historical	amounts	disclosed	in	our	Postemployment	Benefits	footnote	as	an estimation	basis	for	retrospectively	applying	the	statement	of	income	presentation	requirements.	In	the	first	quarter	of	2018,	we	adopted	this	ASU	using	the	practical expedient	described	above.	There	was	no	impact	to	our	consolidated	balance	sheet	at	December	30,	2017	or	to	our	consolidated	statements	of	cash	flows	for	the	years ended	December	30,	2017	and	December	31,	2016.	See	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements,	for	the	impacts	on	our	consolidated statements	of	income	for	the	years	ended	December	30,	2017	and	December	31,	2016.

In	May	2014,	the	FASB	issued	ASU	2014-09,	which	superseded	previously	existing	revenue	recognition	guidance.	Under	this	ASU,	companies	must	apply	a	five	step model	to	recognize	revenue	upon	the	transfer	of	promised	goods	or	services	to	customers	and	in	an	amount	that	reflects	the	consideration	to	which	the	company	expects to	be	entitled	in	exchange	for	those	goods	or	services.	The	ASU	may	be	applied	using	a	full	retrospective	method	or	a	modified	retrospective	transition	method,	with	a cumulative-effect	 adjustment	 as	 of	 the	 date	 of	 adoption.	The	ASU	also	provides	for	certain	practical	expedients,	 including	 the	option	 to	expense	as	 incurred	 the incremental	costs	of	obtaining	a	contract,	if	the	contract	period	is	for	one	year	or	less.	This	ASU	was	effective	beginning	in	the	first	quarter	of	our	fiscal	year	2018.	We adopted	this	ASU	in	the	first	quarter	of	2018	using	the	full	retrospective	method	and	the	practical	expedient	described	above.	Upon	adoption,	we	made	the	following policy	elections:	(i)	we	account	for	shipping	and	handling	costs	as	contract	fulfillment	costs,	and	(ii)	we	exclude	taxes	imposed	on	and	collected	from	customers	in revenue	producing	transactions	(e.g.,	sales,	use,	and	value	added	taxes)	from	the	transaction	price.	The	impact	of	adopting	this	guidance	was	immaterial	to	our	financial statements	and	related	disclosures.

# Income	Tax	Impacts	of	Certain	Intercompany	Transfers:

In	October	2016,	the	FASB	issued	ASU	2016-16	related	to	the	income	tax	accounting	impacts	of	intra-entity	transfers	of	assets	other	than	inventory,	such	as	intellectual property	and	property,	plant	and	equipment.	Under	the	new	accounting	guidance,	current	and	deferred	income	taxes	should	be	recognized	upon	transfer	of	the	assets. Previously,	recognition	of	current	and	deferred	income	taxes	was	prohibited	until	the	asset	was	sold	to	an	external	party.	This	ASU	became	effective	beginning	in	the	first quarter	of	our	fiscal	year	2018.	We	adopted	this	new	guidance	on	a	modified	retrospective	basis	through	a	cumulative-effect	adjustment	of	$95	million	to	decrease retained	earnings	in	the	first	quarter	of	2018.

# Definition	of	a	Business	Clarification:

In	January	2017,	the	FASB	issued	ASU	2017-01	clarifying	the	definition	of	a	business	used	in	determining	whether	transactions	should	be	accounted	for	as	acquisitions (or	disposals)	of	assets	or	businesses.	The	ASU	provides	a	screen	for	companies	to	determine	if	an	integrated	set	of	assets	and	activities	("set")	is	not	a	business.	If substantially	all	of	the	fair	value	of	the	gross	assets	acquired	(or	disposed	of)	is	concentrated	in	a	single	identifiable	asset	or	a	group	of	similar	identifiable	assets,	the	set is	not	a	business.	If	this	screen	is	not	met,	the	entity	then	determines	if	the	set	meets	the	minimum	requirement	of	a	business.	For	a	set	to	be	a	business,	it	must	include an	input	and	a	substantive	process	which	together	significantly	contribute	to	the	ability	to	create	outputs.	This	ASU	became	effective	beginning	in	the	first	quarter	of	our fiscal	year	2018.	We	adopted	this	ASU	on	a	prospective	basis.	The	adoption	of	this	ASU	did	not	impact	our	financial	statements	or	related	disclosures.

# Goodwill	Impairment	Test	Simplification:

In	January	2017,	the	FASB	issued	ASU	2017-04	related	to	goodwill	impairment	testing.	This	ASU	eliminates	Step	2	from	the	goodwill	impairment	test.	Under	the	new guidance,	if	a	reporting	unit's	carrying	amount	exceeds	its	fair	value,	the	entity	will	record	an	impairment	loss	based	on	that	difference.	The	impairment	loss	will	be limited	to	the	amount	of	goodwill	allocated	to	that	reporting	unit.	Previously,	if	the	fair	value	of	a	reporting	unit	was	lower	than	its	carrying	amount	(Step	1),	an	entity was	required	to	calculate	any	impairment	loss	by	comparing	the	implied	fair	value	of	goodwill	with	its	carrying	amount	(Step	2).	Additionally,	under	the	new	standard, companies	that	have	reporting	units	with	zero	or	negative	carrying	amounts	will	no	longer	be	required	to	perform	the	qualitative	assessment	to	determine	whether	to perform	Step	2	of	the	goodwill	impairment	test.	As	a	result,	reporting	units	with	zero	or	negative	carrying	amounts	will	generally	be	expected	to	pass	the	simplified impairment	test;	however,	additional	disclosure	will	be	required	of	those	companies.	We	early	adopted	this	guidance	on	a	prospective	basis	as	of	April	1,	2018	(our annual	impairment	testing	date	in	the	second	quarter	of	2018).	As	a	result	of	adopting	this	ASU,	we	no	longer	perform	Step	2	while	completing	our	goodwill	impairment testing,	beginning	with	our	annual	goodwill	impairment	testing	in	the	second	quarter	of	2018.

# Accounting	for	Hedging	Activities:

In	August	2017,	the	FASB	issued	ASU	2017-12	related	to	accounting	for	hedging	activities.	This	guidance	impacted	the	accounting	for	financial	(e.g.,	foreign	exchange and	interest	rate)	and	non-financial	(e.g.,	commodity)	hedging	activities.	We	early	adopted	this	guidance	on	a	modified	retrospective	basis	in	the	third	quarter	of	2018. Upon	adoption,	we	recognized	an	insignificant	cumulative-effect	adjustment	to	retained	earnings/(deficit).	The	most	significant	impacts	of	adoption	are	that	we	now:

•Recognize	changes	in	the	fair	value	of	excluded	components	in	net	income/(loss)	in	the	current	period	or	in	other	comprehensive	income/(loss)	(and	then amortize	into	net	income/(loss)	over	the	life	of	the	hedging	relationship);

•Defer	changes	in	the	spot	rate	of	the	hedging	instrument	into	other	comprehensive	income/(loss),	while	the	excluded	component	(i.e.,	forward	points	or	option premiums	or	discounts)	is	amortized	into	net	income/(loss)	over	the	life	of	the	hedging	relationship.	When	the	excluded	component	is	released	or	the	forecasted transaction	occurs,	it	is	recognized	in	the	same	income	statement	line	item	affected	by	the	hedged	item;	and

•Present	 additional	 details	 in	 our	 tabular	 disclosures	 in	 the	 footnotes	 to	 the	 financial

statements.

Additionally,	ASU	2017-12	eliminated	the	requirement	to	separately	measure	and	report	hedge	ineffectiveness;	therefore,	we	removed	disclosures	related	to	hedge ineffectiveness.	See	our	consolidated	statements	of	other	comprehensive	income,	Note	3,	Significant	Accounting	Policies,	Note	14,	Financial	Instruments,	and	Note	15, Accumulated	Other	Comprehensive	Income/(Losses),	for	updated	disclosures	pursuant	to	ASU	2017-12.

# Accounting	Standards	Not	Yet	Adopted

# Leases:

In	February	2016,	the	FASB	issued	ASU	2016-02	to	establish	the	principles	that	lessees	and	lessors	shall	apply	to	report	useful	information	to	users	of	financial statements	about	the	amount,	timing,	and	uncertainty	of	cash	flows	arising	from	a	lease.	The	updated	guidance	requires	lessees	to	reflect	the	majority	of	leases	on	their balance	sheets	as	assets	and	obligations.	This	ASU	will	be	effective	beginning	in	the	first	quarter	of	our	fiscal	year	2019.	Early	adoption	is	permitted.	The	guidance	must be	adopted	using	a	modified	retrospective	transition	method.	The	ASU	also	provides	for	certain	practical	expedients.	Among	the	practical	expedients	is	an	optional transition	method	that	allows	companies	to	apply	the	guidance	at	the	adoption	date	and	recognize	a	cumulative-effect	adjustment	to	retained	earnings/(deficit)	on	the adoption	date.	We	plan	to	elect	this	practical	expedient	upon	adoption.	We	also	plan	to	elect	the	package	of	practical	expedients	that	will	allow	us	to	carry	forward	our determination	of	whether	a	lease	exists,	the	classification	of	a	lease,	and	whether	initial	direct	lease	costs	exist	for	purposes	of	transition	to	the	new	standard.	We	do	not expect	to	use	the	hindsight	practical	expedient.	We	do	plan	to	elect	the	land	easement	option,	which	will	allow	us	to	continue	to	use	prior	accounting	conclusions	reached in	our	accounting	for	land	easements.	We	also	plan	to	elect	the	short-term	lease	exemption	whereby	we	will	not	record	an	asset	or	liability	for	short-term	leases.	We	have completed	our	scoping	reviews,	identified	our	significant	leases	by	geography	and	by	asset	type,	and	developed	our	accounting	policies	and	expected	policy	elections, which	will	take	effect	upon	adoption	of	the	standard.	We	have	executed	our	lease	data	extraction	strategy	and	completed	data	extraction	efforts.	Our	identified	accounting system,	which	will	support	the	future	state	leasing	process,	is	also	ready	for	implementation.	We	have	completed	our	future	state	process	design	as	part	of	the	overall system	implementation.	Upon	adoption,	we	expect	that	our	financial	statement	disclosures	will	be	expanded	to	present	additional	details	of	our	leasing	arrangements.	We expect	this	guidance	to	have	a	significant	impact	on	our	financial	statements.	We	currently	estimate	that,	upon	adoption,	we	will	have	total	lease	assets	between approximately	$750	million	and	$910	million	and	total	lease	liabilities	between	approximately	$810	million	and	$990	million.	We	will	adopt	this	ASU	on	the	first	day	of our	fiscal	year	2019.

# Measurement	of	Current	Expected	Credit	Losses:

In	June	2016,	the	FASB	issued	ASU	2016-13	to	update	the	methodology	used	to	measure	current	expected	credit	losses	("CECL").	This	ASU	applies	to	financial	assets measured	at	amortized	cost,	including	loans,	held-to-maturity	debt	securities,	net	investments	in	leases,	and	trade	accounts	receivable	as	well	as	certain	off-balance	sheet credit	exposures,	such	as	loan	commitments.	This	ASU	replaces	the	current	incurred	loss	impairment	methodology	with	a	methodology	to	reflect	CECL	and	requires consideration	of	a	broader	range	of	reasonable	and	supportable	information	to	explain	credit	loss	estimates.	The	guidance	must	be	adopted	using	a	modified	retrospective transition	method	through	a	cumulative-effect	adjustment	to	retained	earnings/(deficit)	in	the	period	of	adoption.	This	ASU	will	be	effective	beginning	in	the	first	quarter of	our	fiscal	year	2020.	Early	adoption	is	permitted.	We	are	currently	evaluating	the	impact	this	ASU	will	have	on	our	financial	statements	and	related	disclosures	as	well as	the	timing	of	adoption.

# Reclassification	of	Certain	Tax	Effects	from	Accumulated	Other	Comprehensive	Income:

In	February	2018,	the	FASB	issued	ASU	2018-02	related	to	reclassifying	tax	effects	stranded	in	accumulated	other	comprehensive	income/(losses)	because	of	the	Tax Cuts	and	Jobs	Act	("U.S.	Tax	Reform")	enacted	on	December	22,	2017.	U.S.	Tax	Reform	reduced	the	U.S.	federal	corporate	tax	rate	from	35.0%	to	21.0%.	ASC	Topic 740,	Income	Taxes,	requires	the	remeasurement	of	deferred	tax	assets	and	liabilities	as	a	result	of	such	changes	in	tax	laws	or	rates	to	be	presented	in	net	income/(loss) from	continuing	operations.	However,	the	related	tax	effects	of	such	deferred	tax	assets	and	liabilities	may	have	been	originally	recorded	in	other	comprehensive income/(loss).	This	ASU	allows	companies	to	reclassify	such	stranded	tax	effects	from	accumulated	other	comprehensive	income/(losses)	to	retained	earnings/(deficit). This	reclassification	adjustment	is	optional,	and	if	elected,	may	be	applied	either	to	the	period	of	adoption	or	retrospectively	to	the	period(s)	impacted	by	U.S.	Tax Reform.	Additionally,	this	ASU	requires	companies	to	disclose	the	policy	election	for	stranded	tax	effects	as	well	as	the	general	accounting	policy	for	releasing	income tax	effects	from	accumulated	other	comprehensive	income/(losses).	This	ASU	will	be	effective	beginning	in	the	first	quarter	of	our	fiscal	year	2019.	Early	adoption	is permitted.	We	will	adopt	this	ASU	on	the	first	day	of	our	fiscal	year	2019	and	will	make	the	policy	election	to	reclassify	stranded	tax	effects	from	accumulated	other comprehensive	 income/(losses)	 to	 retained	 earnings/(deficit).	 We	 currently	 estimate	 the	 increase	 to	 retained	 earnings/(deficit)	 upon	 adoption	 will	 be	 between approximately	$130	million	and	$140	million.

# Fair	Value	Measurement	Disclosures:

In	August	2018,	the	FASB	issued	ASU	2018-13	related	to	fair	value	measurement	disclosures.	This	ASU	removes	the	requirement	to	disclose	the	amount	of	and	reasons for	transfers	between	Levels	1	and	2	of	the	fair	value	hierarchy,	the	policy	for	determining	that	a	transfer	has	occurred,	and	valuation	processes	for	Level	3	fair	value measurements.	Additionally,	this	ASU	modifies	the	disclosures	related	to	the	measurement	uncertainty	for	recurring	Level	3	fair	value	measurements	(by	removing	the requirement	to	disclose	sensitivity	to	future	changes)	and	the	timing	of	liquidation	of	investee	assets	(by	removing	the	timing	requirement	in	certain	instances).	The guidance	also	requires	new	disclosures	for	Level	3	financial	assets	and	liabilities,	including	the	amount	and	location	of	unrealized	gains	and	losses	recognized	in	other comprehensive	income/(loss)	and	additional	information	related	to	significant	unobservable	inputs	used	in	determining	Level	3	fair	value	measurements.	This	ASU	will be	effective	beginning	in	the	first	quarter	of	our	fiscal	year	2020.	Early	adoption	of	the	guidance	in	whole	is	permitted.	Alternatively,	companies	may	early	adopt removed	or	modified	disclosures	and	delay	adoption	of	the	additional	disclosures	until	their	effective	date.	Certain	of	the	amendments	in	this	ASU	must	be	applied prospectively	upon	adoption,	while	other	amendments	must	be	applied	retrospectively	upon	adoption.	We	elected	to	early	adopt	the	provisions	related	to	removing disclosures	in	the	fourth	quarter	of	our	fiscal	year	2018	on	a	retrospective	basis.	Accordingly,	we	have	removed	information	related	to	our	valuation	process	for	Level	3 fair	value	measurements	for	pension	plan	investments	within	Note	13,	Postemployment	Benefits.	We	also	removed	information	about	the	amount	of	and	reasons	for transfers	between	Levels	1	and	2	of	the	fair	value	hierarchy	from	Note	14,	Financial	Instruments.	There	was	no	other	impact	to	our	financial	statement	disclosures	as	a result	of	early	adopting	the	provisions	related	to	removing	disclosures.	We	are	currently	evaluating	the	disclosure	impact	of	the	provisions	related	to	modifying	and adding	disclosures	as	well	as	the	timing	of	adoption.

# Disclosure	Requirements	for	Certain	Employer-Sponsored	Benefit	Plans:

In	August	2018,	the	FASB	issued	ASU	2018-14	related	to	the	disclosure	requirements	for	employers	that	sponsor	defined	benefit	pension	and	other	postretirement benefit	plans.	The	guidance	requires	sponsors	of	these	plans	to	provide	additional	disclosures,	including	weighted-average	interest	rates	used	in	the	company's	cash balance	plans	and	a	narrative	description	of	reasons	for	any	significant	gains	or	losses	impacting	the	benefit	obligation	for	the	period.	Additionally,	this	guidance eliminates	certain	previous	disclosure	requirements.	This	ASU	will	be	effective	beginning	in	the	first	quarter	of	our	fiscal	year	2020.	Early	adoption	is	permitted.	This guidance	must	be	applied	on	a	retrospective	basis	to	all	periods	presented.	We	are	currently	evaluating	the	impact	this	ASU	will	have	on	our	financial	statements	and related	disclosures	as	well	as	the	timing	of	adoption.

# Implementation	Costs	Incurred	in	Hosted	Cloud	Computing	Service	Arrangements:

In	August	2018,	the	FASB	issued	ASU	2018-15	related	to	accounting	for	implementation	costs	incurred	in	hosted	cloud	computing	service	arrangements.	Under	the	new guidance,	implementation	costs	incurred	in	a	hosting	arrangement	that	is	a	service	contract	should	be	expensed	or	capitalized	based	on	the	nature	of	the	costs	and	the project	stage	during	which	such	costs	are	incurred.	If	the	implementation	costs	qualify	for	capitalization,	they	must	be	amortized	over	the	term	of	the	hosting	arrangement and	assessed	for	impairment.	Companies	must	disclose	the	nature	of	any	hosted	cloud	computing	service	arrangements.	This	ASU	also	provides	guidance	for	balance sheet	and	income	statement	presentation	of	capitalized	implementation	costs	and	statement	of	cash	flows	presentation	for	the	related	payments.	This	ASU	will	be effective	beginning	in	the	first	quarter	of	our	fiscal	year	2020.	Early	adoption	is	permitted,	including	in	an	interim	period.	This	guidance	may	be	adopted	either retrospectively	or	prospectively	to	all	implementation	costs	incurred	after	the	date	of	adoption.	We	are	currently	evaluating	the	impact	this	ASU	will	have	on	our financial	statements	and	related	disclosures	as	well	as	the	timing	of	adoption	and	the	application	method.

# Note	5.	Acquisitions	and	Divestitures

# Cerebos	Acquisition

On	March	9,	2018	(the	"Acquisition	Date"),	we	acquired	all	of	the	outstanding	equity	interests	in	Cerebos	Pacific	Limited	("Cerebos")	(the	"Cerebos	Acquisition"),	an Australian	food	and	beverage	company	with	several	local	brands	in	Australia	and	New	Zealand.	The	Cerebos	business	manufactures,	markets,	and	sells	food	and beverage	products,	including	gravies,	sauces,	instant	coffee,	salt,	herbs	and	spices,	and	tea.	Cerebos	is	included	in	our	consolidated	financial	statements	as	of	the Acquisition	Date.	We	have	not	included	unaudited	pro	forma	results,	prepared	in	accordance	with	ASC	805,	as	if	Cerebos	had	been	acquired	as	of	January	1,	2018,	as	it would	not	yield	significantly	different	results.

The	Cerebos	Acquisition	was	accounted	for	under	the	acquisition	method	of	accounting	for	business	combinations.	The	total	consideration	paid	for	Cerebos	was	$244 million.	We	utilized	estimated	fair	values	at	the	Acquisition	Date	to	allocate	the	total	consideration	exchanged	to	the	net	tangible	and	intangible	assets	acquired	and liabilities	assumed.	Such	allocation	was	final	as	of	December	29,	2018.

The	final	purchase	price	allocation	to	assets	acquired	and	liabilities	assumed	in	the	Cerebos	Acquisition	was	(in	millions):

| The	final	purchase	price	allocation	to	assets	acquired	and	liabilities	assumed	in	the	Cerebos	Acquisition	was	(in	millions): |  |
| :--- | :--- |
| Cash | $23 |
| Other\tcurrent\tassets | 65 |
| Property,\tplant\tand\tequipment,\tnet | 75 |
| Identifiable\tintangible\tassets | 100 |
| Trade\tand\tother\tpayables | (41) |
| Other\tnon-current\tliabilities | (3) |
| Net\tassets\tacquired | 219 |
| Goodwill\ton\tacquisition | 25 |
| Total\tconsideration | $244 |

The	Cerebos	Acquisition	resulted	in	$25	million	of	non	tax	deductible	goodwill	relating	principally	to	planned	expansion	of	Cerebos	brands	into	new	categories	and markets.	This	goodwill	was	allocated	to	Rest	of	World	as	shown	in	Note	10,	Goodwill	and	Intangible	Assets.

The	final	purchase	price	allocation	to	identifiable	intangible	assets	acquired	in	the	Cerebos	Acquisition	was:

|  | Fair	Value<br>(in	millions	of	dollars) | Life<br>(in	years) |
| :--- | :--- | :--- |
| Definite-lived\ttrademarks | $87 | 22 |
| Customer-related\tassets | 13 | 12 |
| Total | $100 |  |

We	valued	trademarks	using	the	relief	from	royalty	method	and	customer-related	assets	using	the	distributor	method.	Some	of	the	more	significant	assumptions	inherent in	developing	the	valuations	included	the	estimated	annual	net	cash	flows	for	each	definite-lived	intangible	asset	(including	net	sales,	cost	of	products	sold,	selling	and marketing	costs,	and	working	capital/contributory	asset	charges),	the	discount	rate	that	appropriately	reflects	the	risk	inherent	in	each	future	cash	flow	stream,	the assessment	of	each	asset's	life	cycle,	and	competitive	trends,	as	well	as	other	factors.	We	determined	the	assumptions	used	in	the	financial	forecasts	using	historical	data, supplemented	by	current	and	anticipated	market	conditions,	estimated	product	category	growth	rates,	management	plans,	and	market	comparables.

We	used	carrying	values	as	of	the	Acquisition	Date	to	value	trade	receivables	and	payables,	as	well	as	certain	other	current	and	non-current	assets	and	liabilities,	as	we determined	that	they	represented	the	fair	value	of	those	items	at	the	Acquisition	Date.

We	valued	finished	goods	and	work-in-process	inventory	using	a	net	realizable	value	approach.	Raw	materials	and	packaging	inventory	was	valued	using	the	replacement cost	approach.

We	valued	property,	plant	and	equipment	using	a	combination	of	the	income	approach,	the	market	approach,	and	the	cost	approach,	which	is	based	on	the	current replacement	and/or	reproduction	cost	of	the	asset	as	new,	less	depreciation	attributable	to	physical,	functional,	and	economic	factors.

We	incurred	deal	costs	of	$18	million	in	2018	related	to	the	Cerebos	Acquisition.

# Other	Acquisitions

In	the	third	quarter	of	2018,	we	had	two	additional	acquisitions	of	businesses,	including	The	Ethical	Bean	Coffee	Company	Ltd.,	a	Canadian-based	coffee	roaster,	and Wellio,	Inc.,	a	full-service	meal	planning	and	preparation	technology	start-up	in	the	U.S.	The	aggregate	consideration	paid	related	to	these	acquisitions	was	$27	million.

In	November	2018,	we	entered	into	a	definitive	agreement	with	a	third	party	to	acquire	all	of	the	outstanding	equity	interests	in	Primal	Nutrition,	LLC	("Primal Nutrition")	for	approximately	$200	million	(the	"Primal	Acquisition").	Primal	Nutrition	is	a	better-for-you	brand	primarily	focused	on	condiments,	sauces,	and	dressings, with	growing	product	lines	in	healthy	snacks	and	other	categories.	The	brand	holds	leading	positions	in	the	e-commerce	and	natural	channels.	The	Primal	Acquisition closed	on	January	3,	2019.

We	incurred	aggregate	deal	costs	related	to	other	acquisitions	of	$2	million	in	2018.

In	May	2018,	we	sold	our	50.1%	interest	in	our	South	African	subsidiary	to	our	minority	interest	partner.	The	transaction	included	proceeds	of	$18	million,	which	are included	in	other	investing	activities,	net	on	the	consolidated	statement	of	cash	flows	for	2018.	We	recorded	a	pre-tax	loss	on	sale	of	business	of	approximately	$15 million.	The	pre-tax	loss	was	included	in	SG&A	on	the	consolidated	statement	of	income	for	2018.

In	October	2018,	we	entered	into	a	definitive	agreement	with	Zydus	Wellness	Limited	and	Cadila	Healthcare	Limited	(collectively,	the	"Buyers")	to	sell	100%	of	our equity	interests	in	Heinz	India	Private	Limited	("Heinz	India")	for	approximately	46	billion	Indian	rupees	(approximately	$660	million	 at	December	29,	2018)	(the "Heinz	India	Transaction").	In	connection	with	the	Heinz	India	Transaction,	we	will	transfer	to	the	Buyers,	among	other	assets	and	operations,	our	global	intellectual property	rights	to	several	brands,	including	Complan,	Glucon-D,	Nycil,	and	Sampriti.	Our	core	brands	(i.e.,	Heinz	and	Kraft)	will	not	be	transferred.	The	Heinz	India Transaction	closed	on	January	30,	2019.	We	expect	to	recognize	a	gain	on	this	transaction	upon	closing.	We	have	presented	the	assets	and	liabilities	related	to	the	Heinz India	Transaction	as	held	for	sale	on	the	consolidated	balance	sheet	at	December	29,	2018.	This	divestiture	is	not	considered	a	strategic	shift	that	will	have	a	major	effect on	our	operations	or	financial	results;	therefore,	it	will	not	be	reported	as	discontinued	operations.

We	entered	into	foreign	exchange	derivative	contracts	to	economically	hedge	the	foreign	currency	exposure	related	to	the	Heinz	India	Transaction.	Additionally,	we entered	into	foreign	exchange	derivative	contracts,	which	are	designated	as	net	investment	hedges	related	to	our	investment	in	Heinz	India.	See	Note	14,	Financial Instruments,	for	additional	information.	We	also	recorded	changes	in	our	deferred	tax	liabilities	related	to	the	Heinz	India	Transaction.	See	Note	11,	Income	Taxes,	for additional	information.

Additionally,	in	November	2018,	we	entered	into	a	definitive	agreement	with	Parmalat	SpA	("Parmalat")	to	sell	certain	assets	in	our	natural	cheese	portfolio	in	Canada for	approximately	1.6	billion	Canadian	dollars	(approximately	$1.2	billion	at	December	29,	2018)	(the	"Canada	Natural	Cheese	Transaction").	In	connection	with	the Canada	Natural	Cheese	Transaction,	we	will	transfer	certain	assets	to	Parmalat,	including	the	intellectual	property	rights	to	Cracker	Barrel	in	Canada	and	P'Tit	Quebec globally.	While	this	transaction	is	contingent	on	customary	closing	conditions,	we	expect	the	Canada	Natural	Cheese	Transaction	to	be	finalized	in	mid-2019.	We	expect to	recognize	a	gain	on	this	transaction	upon	closing.	We	have	presented	the	assets	and	liabilities	related	to	the	Canada	Natural	Cheese	Transaction	as	held	for	sale	on	the consolidated	balance	sheet	at	December	29,	2018.	This	divestiture	is	not	considered	a	strategic	shift	that	will	have	a	major	effect	on	our	operations	or	financial	results; therefore,	it	will	not	be	reported	as	discontinued	operations.

Our	assets	and	liabilities	held	for	sale,	by	major	class,	were	(in	millions):

We	incurred	aggregate	deal	costs	related	to	these	divestitures	of	$3	million	in	2018.

# Note	6.	Integration	and	Restructuring	Expenses

As	part	of	our	restructuring	activities,	we	incur	expenses	that	qualify	as	exit	and	disposal	costs	under	U.S.	GAAP.	These	include	severance	and	employee	benefit	costs and	other	exit	costs.	Severance	and	employee	benefit	costs	primarily	relate	to	cash	severance,	non-cash	severance,	including	accelerated	equity	award	compensation expense,	and	pension	and	other	termination	benefits.	Other	exit	costs	primarily	relate	to	lease	and	contract	terminations.	We	also	incur	expenses	that	are	an	integral component	of,	and	directly	attributable	to,	our	restructuring	activities,	which	do	not	qualify	as	exit	and	disposal	costs	under	U.S.	GAAP.	These	include	asset-related	costs and	other	implementation	costs.	Asset-related	costs	primarily	relate	to	accelerated	depreciation	and	asset	impairment	charges.	Other	implementation	costs	primarily	relate to	start-up	costs	of	new	facilities,	professional	fees,	asset	relocation	costs,	costs	to	exit	facilities,	and	costs	associated	with	restructuring	benefit	plans.

Employee	 severance	 and	 other	 termination	 benefit	 packages	 are	 primarily	 determined	 based	 on	 established	 benefit	 arrangements,	 local	 statutory	 requirements,	 or historical	benefit	practices.	We	recognize	the	contractual	component	of	these	benefits	when	payment	is	probable	and	estimable;	additional	elements	of	severance	and termination	 benefits	 associated	 with	 non-recurring	 benefits	 are	 recognized	 ratably	 over	 each	 employee's	 required	 future	 service	 period.	 Charges	 for	 accelerated depreciation	are	recognized	on	long-lived	assets	that	will	be	taken	out	of	service	before	the	end	of	their	normal	service,	in	which	case	depreciation	estimates	are	revised to	reflect	the	use	of	the	asset	over	its	shortened	useful	life.	Asset	impairments	establish	a	new	fair	value	basis	for	assets	held	for	disposal	or	sale,	and	those	assets	are written	down	to	expected	net	realizable	value	if	carrying	value	exceeds	fair	value.	All	other	costs	are	recognized	as	incurred.

# Integration	Program:

At	the	end	of	2017,	we	had	substantially	completed	our	multi-year	program	announced	following	the	2015	Merger	(the	"Integration	Program"),	which	was	designed	to reduce	costs	and	integrate	and	optimize	our	combined	organization,	primarily	in	the	U.S.	and	Canada	segments.	Overall,	as	part	of	the	Integration	Program,	we	closed	net six	factories,	consolidated	our	distribution	network,	and	eliminated	4,900	positions.	Approximately	65%	of	total	Integration	Program	costs	were	reflected	in	cost	of products	sold,	and	approximately	60%	were	cash	expenditures.

As	of	December	29,	2018,	we	had	incurred	cumulative	pre-tax	costs	of	$2,146	million,	including	$92	million	in	2018,	$316	million	in	2017,	and	$887	million	in	2016. The	$2,146	million	of	cumulative	pre-tax	costs	included	$541	million	of	severance	and	employee	benefit	costs,	$889	million	of	non-cash	asset-related	costs,	$609	million of	other	implementation	costs,	and	$107	million	of	other	exit	costs.	The	related	amounts	incurred	in	2018	were	$2	million	of	severance	and	employee	benefit	costs,	$32 million	of	non-cash	asset-related	costs,	$59	million	of	other	implementation	costs,	and	$1	million	of	credits	in	other	exit	costs.

Our	cumulative	pre-tax	costs	related	to	the	Integration	Program,	as	well	as	the	associated	costs	for	the	year	ended	December	30,	2017,	reflect	the	restatements	described in	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements.

As	of	December	29,	2018,	we	do	not	expect	to	incur	significant	additional	expenses	related	to	the	Integration	Program.

Our	liability	balance	for	Integration	Program	costs	that	qualify	as	exit	and	disposal	costs	under	U.S.	GAAP	(i.e.,	severance	and	employee	benefit	costs	and	other	exit costs)	was	(in	millions):

|  | Severance	and<br>Employee	Benefit	Costs | Other	Exit	Costs(a) | Total |
| :--- | :--- | :--- | :--- |
| Balance\tat\tDecember\t30,\t2017 | $24 | $22 | $46 |
| Charges/(credits) | 2 | (1) | 1 |
| Cash\tpayments | (12) | (2) | (14) |
| Non-cash\tutilization | (9) | (19) | (28) |
| Balance\tat\tDecember\t29,\t2018 | $5 | $— | $5 |

(a)	Other	exit	costs	primarily	consist	of	lease	and	contract	terminations.

The	Integration	Program	liability	at	December	29,	2018	relates	to	the	elimination	of	salaried	positions	in	Canada.	We	expect	the	majority	of	this	liability	to	be	paid	by	the end	of	2019.

# Restructuring	Activities:

In	addition	to	our	Integration	Program	in	North	America,	we	have	other	restructuring	programs	globally,	which	are	focused	primarily	on	workforce	reduction,	factory closure	and	consolidation,	and	benefit	plan	restructuring.	Related	 to	 these	programs,	we	expect	 to	eliminate	approximately	1,900	 positions,	1,400	 of	 which	 were eliminated	in	2018.	These	programs	resulted	in	expenses	of	$368	million	in	2018,	including	$48	million	of	severance	and	employee	benefit	costs,	$63	million	of	non-cash asset-related	costs,	$251	million	of	other	implementation	costs,	and	$6	million	of	other	exit	costs.	Other	implementation	costs	included	a	non-cash	settlement	charge related	to	the	settlement	of	our	Canadian	salaried	and	Canadian	hourly	defined	benefit	pension	plans	in	2018.	See	Note	13,	Postemployment	Benefit	Plans,	for	additional information.	Other	restructuring	program	expenses	totaled	$118	million	in	2017	and	$125	million	in	2016.

Our	liability	balance	for	restructuring	project	costs	that	qualify	as	exit	and	disposal	costs	under	U.S.	GAAP	(i.e.,	severance	and	employee	benefit	costs	and	other	exit costs)	was	(in	millions):

|  | Severance	and<br>Employee	Benefit	Costs | Other	Exit	Costs(a) | Total |
| :--- | :--- | :--- | :--- |
| Balance\tat\tDecember\t30,\t2017 | $16 | $25 | $41 |
| Charges/(credits) | 48 | 6 | 54 |
| Cash\tpayments | (35) | (12) | (47) |
| Non-cash\tutilization | 3 | 14 | 17 |
| Balance\tat\tDecember\t29,\t2018 | $32 | $33 | $65 |

We	expect	the	liability	for	severance	and	employee	benefit	costs	as	of	December	29,	2018	to	be	paid	by	the	end	of	2019.	The	liability	for	other	exit	costs	primarily	relates to	lease	obligations.	The	cash	impact	of	these	obligations	will	continue	for	the	duration	of	the	lease	terms,	which	expire	between	2019	and	2026.

# Total	Integration	and	Restructuring:

Total	expense/(income)	related	to	the	Integration	Program	and	restructuring	activities,	by	income	statement	caption,	were	(in	millions):

|  |  | As	Restated	&amp;	Recast | As	Recast |
| :--- | :--- | :--- | :--- |
|  | December\t29,\n2018 | December\t30,\n2017 | December\t31,\n2016 |
| Severance\tand\temployee\tbenefit\tcosts\t-\tCOGS | $12 | $9 | $41 |
| Severance\tand\temployee\tbenefit\tcosts\t-\tSG&amp;A | 32 | 26 | 96 |
| Severance\tand\temployee\tbenefit\tcosts\t-\tOther\texpense/(income),\tnet | 6 | (149) | 20 |
| Asset-related\tcosts\t-\tCOGS | 59 | 191 | 496 |
| Asset-related\tcosts\t-\tSG&amp;A | 36 | 26 | 41 |
| Other\tcosts\t-\tCOGS | 123 | 264 | 162 |
| Other\tcosts\t-\tSG&amp;A | 35 | 67 | 156 |
| Other\tcosts\t-\tOther\texpense/(income),\tnet | 157 | — | — |
|  | $460 | $434 | $1,012 |

Total	expense/(income)	for	the	year	ended	December	30,	2017	reflects	the	restatements	described	in	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial Statements.

We	do	not	include	Integration	Program	and	restructuring	expenses	within	Segment	Adjusted	EBITDA	(as	defined	in	Note	22,	Segment	Reporting).	The	pre-tax	impact	of allocating	such	expenses	to	our	segments	would	have	been	(in	millions):

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| United\tStates | $205 | $270 | $759 |
| Canada | 176 | 34 | 45 |
| EMEA | 16 | 56 | 85 |
| Rest\tof\tWorld | 25 | 13 | 6 |
| General\tcorporate\texpenses | 38 | 61 | 117 |
|  | $460 | $434 | $1,012 |

In	the	first	quarter	of	2018,	we	reorganized	our	segment	structure	to	move	our	Middle	East	and	Africa	businesses	from	the	Rest	of	World	segment	to	the	EMEA reportable	segment.	We	have	reflected	this	change	in	all	historical	periods	presented.	This	change	did	not	have	a	material	impact	on	our	current	or	any	prior	period results.	See	Note	22,	Segment	Reporting,	for	additional	information.

In	addition,	total	expense/(income)	for	the	year	ended	December	30,	2017	reflects	the	restatements	described	in	Note	2,	Restatement	of	Previously	Issued	Consolidated Financial	Statements.

# Note	7.	Restricted	Cash

The	following	table	provides	a	reconciliation	of	cash	and	cash	equivalents,	as	reported	on	our	consolidated	balance	sheets,	to	cash,	cash	equivalents,	and	restricted	cash, as	reported	on	our	consolidated	statements	of	cash	flows	(in	millions):

|  | 2018 | December	30,	2017 |
| :--- | :--- | :--- |
| Cash\tand\tcash\tequivalents | $1,130 | $1,629 |
| Restricted\tcash\tincluded\tin\tother\tcurrent\tassets | 1 | 140 |
| Restricted\tcash\tincluded\tin\tother\tnon-current\tassets | 5 | — |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash | $1,136 | $1,769 |

Our	restricted	cash	at	December	30,	2017	primarily	related	to	withholding	taxes	on	our	common	stock	dividends	to	our	only	significant	international	shareholder,	3G Capital.

# Note	8.	Inventories

Inventories	consisted	of	the	following	(in	millions):

|  |  | As	Restated |
| :--- | :--- | :--- |
|  | December\t29,\t2018 | December\t30,\t2017 |
| Packaging\tand\tingredients | $510 | $560 |
| Work\tin\tprocess | 343 | 384 |
| Finished\tproduct | 1,814 | 1,816 |
| Inventories | $2,667 | $2,760 |

At	December	29,	2018,	inventories	excluded	amounts	classified	as	held	for	sale.	See	Note	5,	Acquisitions	and	Divestitures,	for	additional	information.	Additionally, inventories	at	December	30,	2017	reflect	the	restatements	described	in	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements.

# Note	9.	Property,	Plant	and	Equipment

Property,	plant	and	equipment	consisted	of	the	following	(in	millions):

|  | December	29,	2018 | 2017 |
| :--- | :--- | :--- |
| Land | $218 | $250 |
| Buildings\tand\timprovements | 2,375 | 2,232 |
| Equipment\tand\tother | 5,904 | 5,323 |
| Construction\tin\tprogress | 1,165 | 1,345 |
|  | 9,662 | 9,150 |
| Accumulated\tdepreciation | (2,584) | (2,089) |
| Property,\tplant\tand\tequipment,\tnet | $7,078 | $7,061 |

At	December	29,	2018,	property,	plant	and	equipment,	net,	excluded	amounts	classified	as	held	for	sale.	See	Note	5,	Acquisitions	and	Divestitures,	for	additional information.	Additionally,	property,	plant	and	equipment	balances	at	December	30,	2017	reflect	the	restatements	described	in	Note	2,	 Restatement	of	Previously	Issued Consolidated	Financial	Statements.

# Note	10.	Goodwill	and	Intangible	Assets

# Goodwill:

Changes	in	the	carrying	amount	of	goodwill,	by	segment,	were	(in	millions):

|  | United	States | Canada | EMEA | Rest	of	World | Total |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Balance\tat\tDecember\t30,\t2017\t(As\tRestated) | $33,701 | $5,246 | $3,238 | $2,640 | $44,825 |
| Impairment\tlosses | (4,104) | (1,947) | — | (957) | (7,008) |
| Reclassified\tto\tassets\theld\tfor\tsale | — | (496) | — | (173) | (669) |
| Acquisitions | — | 16 | — | 25 | 41 |
| Translation\tadjustments\tand\tother | — | (381) | (164) | (141) | (686) |
| Balance\tat\tDecember\t29,\t2018 | $29,597 | $2,438 | $3,074 | $1,394 | $36,503 |

Goodwill	at	December	30,	2017	reflects	the	restatements	described	in	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements.

In	the	first	quarter	of	2018,	we	reorganized	our	segment	structure	to	move	our	Middle	East	and	Africa	businesses	from	the	Rest	of	World	segment	to	the	EMEA reportable	segment.	We	have	reflected	this	change	in	all	historical	periods	presented.	Accordingly,	the	segment	goodwill	balances	at	December	30,	2017	reflect	an increase	of	$179	million	in	EMEA	and	a	corresponding	decrease	in	Rest	of	World.	This	change	did	not	have	a	material	impact	on	our	current	or	any	prior	period	results. See	Note	22,	Segment	Reporting,	for	additional	information.

See	Note	5,	Acquisitions	and	Divestitures,	for	additional	information	related	to	our	acquisitions	in	2018,	as	well	as	assets	held	for	sale	at	December	29,	2018	related	to the	Canada	Natural	Cheese	Transaction	and	the	Heinz	India	Transaction.

Our	goodwill	balance	consists	of	20	reporting	units	and	had	an	aggregate	carrying	amount	of	$36.5	billion	as	of	December	29,	2018.	We	test	our	reporting	units	for impairment	annually	as	of	the	first	day	of	our	second	quarter,	or	more	frequently	if	events	or	circumstances	indicate	it	is	more	likely	than	not	that	the	fair	value	of	a reporting	unit	is	less	than	its	carrying	amount.	We	performed	our	2018	annual	impairment	test	as	of	April	1,	2018.	We	utilized	the	discounted	cash	flow	method	under the	income	approach	to	estimate	the	fair	value	of	our	reporting	units.	As	a	result	of	our	2018	annual	impairment	test,	we	recognized	a	non-cash	impairment	loss	of	$133 million	in	SG&A	related	to	our	Australia	and	New	Zealand	reporting	unit	within	our	Rest	of	World	segment	primarily	due	to	anticipated	and	sustained	margin	declines	in the	region.	The	goodwill	carrying	amount	of	this	reporting	unit	was	$509	million	prior	to	its	impairment.

For	the	fourth	quarter	of	2018,	in	connection	with	the	preparation	of	our	year-end	financial	statements,	we	assessed	the	changes	in	circumstances	that	occurred	during	the quarter	to	determine	if	it	was	more	likely	than	not	that	the	fair	values	of	any	reporting	units	were	below	their	carrying	amounts.	Although	our	annual	impairment	test	is performed	during	the	second	quarter,	we	perform	this	qualitative	assessment	each	interim	reporting	period.

While	there	was	no	single	determinative	event	or	factor,	the	consideration	in	totality	of	several	factors	that	developed	during	the	fourth	quarter	of	2018	led	us	to	conclude that	it	was	more	likely	than	not	that	the	fair	values	of	seven	of	our	20	reporting	units,	including	U.S.	Grocery,	U.S.	Refrigerated,	Canada	Retail,	Australia	and	New Zealand,	Northeast	Asia,	Southeast	Asia,	and	Other	Latin	America,	were	below	their	carrying	amounts.	These	factors	included:	(i)	a	sustained	decrease	in	our	share	price in	November	and	December	of	2018,	which	reduced	our	market	capitalization	below	the	book	value	of	net	assets;	(ii)	the	completion	of	our	fourth	quarter	results,	which were	below	management's	expectations	due	to	several	factors	such	as	higher	than	expected	supply	chain	costs	and	increased	competition;	(iii)	the	development	and approval	of	our	2019	annual	operating	plan	in	December	2018,	which	provided	additional	insights	into	expectations	and	priorities	for	the	coming	years,	such	as	lower growth	 and	 margin	 expectations;	 (iv)	 the	 announcement	 in	 November	 2018	 to	 sell	 certain	 assets	 in	 our	 natural	 cheese	 portfolio	 in	 Canada,	 which	 changed	 the composition	and	use	of	the	remaining	assets	and	brands	in	the	associated	reporting	unit;	(v)	fluctuations	in	foreign	exchange	rates	in	certain	countries;	(vi)	increased interest	rates	in	certain	locations,	including	an	increase	in	the	United	States	in	December	2018;	and	(vii)	increased	and	prolonged	economic	and	regulatory	uncertainty	in the	United	States	and	global	economies	as	of	the	end	of	December	2018.

As	we	determined	that	it	was	more	likely	than	not	that	the	fair	values	of	these	seven	reporting	units	were	below	their	carrying	amounts,	we	performed	an	interim impairment	test	on	these	reporting	units	as	of	December	29,	2018.	After	assessing	the	totality	of	circumstances,	we	determined	that	each	of	the	remaining	13	reporting units	was	unlikely	to	have	a	fair	value	below	carrying	amount.

As	a	result	of	our	interim	test,	we	recognized	a	non-cash	impairment	loss	of	$6.9	billion	in	SG&A	related	to	five	reporting	units,	including	U.S.	Refrigerated,	Canada Retail,	Southeast	Asia,	Northeast	Asia,	and	Other	Latin	America.	The	other	 two	reporting	units	we	tested	were	determined	to	not	be	impaired.	We	utilized	the	discounted cash	flow	method	under	the	income	approach	to	estimate	the	fair	value	of	our	reporting	units.	Drivers	of	these	impairment	losses,	by	reporting	unit,	were	as	follows:

•We	recognized	a	$4.1	billion	impairment	loss	in	our	U.S.	Refrigerated	reporting	unit	within	our	United	States	segment	due	to	revised	2019	base	and	future	year margin	expectations,	primarily	in	the	natural	cheese	and	meats	categories,	and,	to	a	lesser	extent,	expectations	for	lower	long-term	net	sales	growth	in	the	natural and	processed	cheese	categories.	Changes	in	future	year	margin	expectations	were	primarily	driven	by	sustained	increases	in	supply	chain	costs,	expectations	for lower	pricing	to	maintain	competitive	positioning,	and	expectations	for	increased	marketing	investments,	primarily	in	response	to	private	label	competition,	as well	as	customer-driven	packaging	investments.	Changes	in	expectations	for	lower	long-term	net	sales	growth	were	primarily	due	to	sustained	private	label competition	and	anticipated	trends	in	consumer	preferences.	Our	revised	expectations	were	based	on	the	completion	of	our	fourth	quarter	results,	which	were below	management's	expectations,	and	the	development	of	our	2019	annual	operating	plan	in	December	2018.	Additionally,	our	revised	expectations	were based	on	the	development	of	our	global	five-year	operating	plan,	which	commenced	in	November	2018	and	we	expect	to	be	completed	in	2019.	The	goodwill carrying	amount	of	the	U.S.	Refrigerated	reporting	unit	was	$11.3	billion	prior	to	its	impairment.

•We	recognized	a	$1.9	billion	impairment	loss	in	our	Canada	Retail	reporting	unit	within	our	Canada	segment	due	to	lower	positive	net	sales	growth	expectations and	revised	2019	base	and	future	year	margin	expectations,	as	well	as	the	reassessment	of	our	Canadian	operations	following	the	announcement	in	November	to sell	certain	assets	in	our	natural	cheese	portfolio	in	Canada.	We	revised	our	net	sales	growth	expectations	primarily	due	to	our	expected	exit	of	the	natural cheese	category	and	expected	declines	in	the	coffee	category	(exclusive	of	our	coffee	business	acquisition	in	Canada	in	2018).	Our	revised	expectations	were based	on	the	completion	of	our	fourth	quarter	results,	which	were	below	management's	expectations,	and	the	development	of	our	2019	annual	operating	plan	in December	2018.	Changes	in	future	year	margin	expectations	were	primarily	driven	by	sustained	increases	in	supply	chain	costs	and	expectations	for	lower pricing	to	maintain	competitive	positioning.	The	goodwill	carrying	amount	of	the	Canada	Retail	reporting	unit	was	$4.0	billion	prior	to	its	impairment.

•We	recognized	a	$315	million	impairment	loss	in	our	Southeast	Asia	reporting	unit	within	our	Rest	of	World	segment	due	to	margin	and	net	sales	declines	in	the seafood	and	seasonal	cordials	categories	and	foreign	exchange	rate	declines	in	Indonesia	and	Papua	New	Guinea.	Our	revised	expectations	were	based	on	the completion	of	our	fourth	quarter	results,	which	were	below	management's	expectations,	and	the	development	of	our	2019	annual	operating	plan	in	December 2018.	This	impairment	represents	all	of	the	goodwill	of	the	Southeast	Asia	reporting	unit.

•We	recognized	a	$302	million	impairment	loss	in	our	Northeast	Asia	reporting	unit	within	our	Rest	of	World	segment	due	to	margin	and	net	sales	declines	as well	as	foreign	exchange	rate	declines	in	Japan	and	Korea.	Our	revised	expectations	were	based	on	the	completion	of	our	fourth	quarter	results,	which	were below	management's	expectations,	and	the	development	of	our	2019	annual	operating	plan	in	December	2018.	The	goodwill	carrying	amount	of	the	Northeast Asia	reporting	unit	was	$391	million	prior	to	its	impairment.

•We	recognized	a	$207	million	impairment	loss	in	our	Other	Latin	America	reporting	unit	within	our	Rest	of	World	segment	due	to	net	sales	and	margin	declines in	the	region.	Our	revised	expectations	were	based	on	the	completion	of	our	fourth	quarter	results,	which	were	below	management's	expectations,	and	the development	of	our	2019	annual	operating	plan	in	December	2018.	This	impairment	represents	all	of	the	goodwill	of	the	Other	Latin	America	reporting	unit.

The	goodwill	carrying	amounts	associated	with	an	additional	four	reporting	units,	which	each	had	excess	fair	value	over	its	carrying	amount	of	20%	or	less,	were	$18.5 billion	for	U.S.	Grocery,	$424	million	for	Latin	America	Exports,	$404	million	for	Southeast	Europe,	and	$367	million	for	Australia	and	New	Zealand	as	of	December 29,	2018.

Accumulated	impairment	losses	to	goodwill	were	$7.0	billion	at	December	29,	2018.

Fair	value	determinations	require	considerable	judgment	and	are	sensitive	to	changes	in	underlying	assumptions,	estimates,	and	market	factors.	Estimating	the	fair	value of	individual	reporting	units	requires	us	to	make	assumptions	and	estimates	regarding	our	future	plans,	as	well	as	industry,	economic,	and	regulatory	conditions.	These assumptions	and	estimates	include	estimated	future	annual	net	cash	flows,	income	tax	rates,	discount	rates,	growth	rates,	and	other	market	factors.	If	current	expectations of	future	growth	rates	and	margins	are	not	met,	if	market	factors	outside	of	our	control,	such	as	discount	rates,	change,	or	if	management's	expectations	or	plans otherwise	change,	including	as	a	result	of	the	development	of	our	global	five-year	operating	plan,	then	one	or	more	of	our	reporting	units	might	become	impaired	in	the future.	Our	reporting	units	that	were	impaired	in	2018	were	written	down	to	their	respective	fair	values	resulting	in	zero	excess	fair	value	over	carrying	amount	as	of	their latest	2018	impairment	testing	dates.	Accordingly,	these	and	other	individual	reporting	units	that	have	20%	or	less	excess	fair	value	over	carrying	amount	as	of	their	latest testing	date	have	a	heightened	risk	of	future	impairments	if	any	assumptions,	estimates,	or	market	factors	change	in	the	future.	Reporting	units	with	a	heightened	risk	of future	impairments	had	an	aggregate	goodwill	carrying	amount	of	$29.0	billion	at	December	29,	2018	and	included:	U.S.	Grocery,	U.S.	Refrigerated,	Canada	Retail, Latin	America	Exports,	Southeast	Europe,	Australia	and	New	Zealand,	and	Northeast	Asia.	Of	the	$29.0	billion	with	a	heightened	risk	of	future	impairments,	$9.3	billion is	attributable	to	reporting	units	with	0%	excess	fair	value	over	carrying	amount.	Although	the	remaining	reporting	 units	have	more	than	20%	excess	fair	value	over carrying	amount	as	of	their	latest	2018	impairment	testing	date,	these	amounts	are	also	associated	with	the	2013	Heinz	acquisition	and	the	2015	Merger	and	are	recorded on	the	balance	sheet	at	their	estimated	acquisition	date	fair	values.	Therefore,	if	any	assumptions,	estimates,	or	market	factors	change	in	the	future,	these	amounts	are	also susceptible	to	impairments.

# Indefinite-lived	intangible	assets:

Changes	in	the	carrying	amount	of	indefinite-lived	intangible	assets,	which	primarily	consisted	of	trademarks,	were	(in	millions):

| Balance	at	December	30,	2017 | $53,655 |
| :--- | :--- |
| Impairment\tlosses | (8,925) |
| Reclassified\tto\tassets\theld\tfor\tsale | (341) |
| Transfers\tto\tdefinite-lived\tintangible\tassets | (72) |
| Translation\tadjustments | (351) |
| Balance\tat\tDecember\t29,\t2018 | $43,966 |

Indefinite-lived	intangible	assets	reclassified	to	assets	held	for	sale	included	the	Cracker	Barrel	trademark	in	Canada	and	Complan	and	Glucon-D	trademarks	in	India. See	Note	5,	Acquisitions	and	Divestitures,	for	additional	information	on	assets	held	for	sale	at	December	29,	2018	related	to	the	Canada	Natural	Cheese	Transaction	and the	Heinz	India	Transaction.

Our	 indefinite-lived	 intangible	 asset	 balance	 primarily	 consists	 of	 a	 number	 of	 individual	 brands,	 which	 had	 an	 aggregate	 carrying	 amount	 of	$44.0	billion	 as	 of December	29,	2018.	We	test	our	brands	for	impairment	annually	as	of	the	first	day	of	our	second	quarter,	or	more	frequently	if	events	or	circumstances	indicate	it	is	more likely	than	not	that	the	fair	value	of	a	brand	is	less	than	its	carrying	amount.	We	performed	our	2018	annual	impairment	test	as	of	April	1,	2018.	As	a	result	of	our	2018 annual	impairment	test,	we	recognized	a	non-cash	impairment	loss	of	$101	million	in	SG&A	in	the	second	quarter	of	2018.	This	impairment	loss	was	due	to	net	sales	and margin	declines	related	to	the	Quero	brand	in	Brazil,	which	was	valued	using	the	relief	from	royalty	method.	The	impairment	loss	was	recorded	in	our	Rest	of	World segment,	consistent	with	the	ownership	of	the	trademark.

In	the	third	quarter	of	2018,	we	recognized	a	non-cash	impairment	loss	of	$215	million	in	SG&A	related	to	the	Smart	Ones	brand,	which	was	valued	using	the	relief	from royalty	method.	This	impairment	loss	was	primarily	due	to	reduced	future	investment	expectations	and	continued	sales	declines	in	the	third	quarter	of	2018.	The impairment	loss	was	recorded	in	our	United	States	segment,	consistent	with	the	ownership	of	the	trademark.	We	transferred	the	remaining	carrying	amount	of	Smart Ones	to	definite-lived	intangible	assets	due	to	a	shift	in	future	investments	to	other	brands	in	the	frozen	and	chilled	foods	category.

For	the	fourth	quarter	of	2018,	in	connection	with	the	preparation	of	our	year-end	financial	statements,	we	assessed	the	changes	in	circumstances	that	occurred	during	the quarter	to	determine	if	it	was	more	likely	than	not	that	the	fair	values	of	any	brands	were	below	their	carrying	amounts.	Although	our	annual	impairment	test	is	performed during	the	second	quarter,	we	perform	this	qualitative	assessment	each	interim	reporting	period.

While	there	was	no	single	determinative	event	or	factor,	the	consideration	in	totality	of	several	factors	that	developed	during	the	fourth	quarter	of	2018	led	us	to	conclude that	it	was	more	likely	than	not	that	the	fair	values	of	six	of	our	brands,	including	Kraft,	Philadelphia,	Oscar	Mayer,	Velveeta,	Cool	Whip,	and	ABC,	were	below	their carrying	amounts.	These	factors	were	the	same	fourth	quarter	circumstances	outlined	in	the	goodwill	impairment	discussion	above.	As	we	determined	that	it	was	more likely	than	not	that	the	fair	values	of	these	six	brands	were	below	their	carrying	amounts,	we	performed	an	interim	impairment	test	on	these	brands	as	of	December	29, 2018.	After	assessing	the	totality	of	circumstances,	we	determined	that	each	of	the	remaining	brands	was	unlikely	to	have	a	fair	value	below	its	carrying	amount.

As	a	result	of	our	interim	test,	we	recognized	a	non-cash	impairment	loss	of	$8.6	billion	in	SG&A	related	to	five	brands,	including	three	that	were	valued	using	the	excess earnings	method	(Kraft,	Oscar	Mayer,	and	Philadelphia)	and	two	that	were	valued	using	the	relief	from	royalty	method	(Velveeta	and	ABC).	The	other	brand	we	tested was	determined	to	not	be	impaired.	The	impairment	losses	for	Kraft,	Oscar	Mayer,	Philadelphia,	and	Velveeta	were	recorded	in	our	United	States	segment,	and	the	ABC impairment	loss	was	recorded	in	our	Rest	of	World	segment,	consistent	with	the	ownership	of	each	trademark.	Drivers	of	these	impairment	losses,	by	brand,	were	as follows:

•We	recognized	a	$4.3	billion	impairment	loss	related	to	the	Kraft	brand,	primarily	due	to	lower	long-term	net	sales	growth	expectations	in	the	natural	cheese category	in	the	United	States,	lower	net	sales	growth	expectations	in	the	processed	cheese	category	in	the	United	States	and	Canada,	and	the	exit	of	the	natural cheese	category	in	Canada	announced	in	November	2018.	Changes	in	expectations	for	lower	net	sales	growth	were	primarily	due	to	distribution	losses	driven	by sustained	private	label	competition	and	anticipated	trends	in	consumer	preferences.	Our	revised	expectations	were	based	on	the	completion	of	our	fourth	quarter results,	which	were	below	management's	expectations,	and	the	development	of	our	2019	annual	operating	plan	in	December	2018.	Additionally,	our	revised expectations	were	based	on	the	development	of	our	global	five-year	operating	plan,	which	commenced	in	November	2018	and	we	expect	to	be	completed	in 2019.	The	carrying	amount	of	the	Kraft	brand	was	$15.9	billion	prior	to	its	impairment.

•We	recognized	a	$3.3	billion	impairment	loss	related	to	the	Oscar	Mayer	brand,	primarily	due	to	revised	2019	annual	and	future	margin	expectations	in	the United	States.	Changes	in	future	year	margin	expectations	were	primarily	driven	by	sustained	increases	in	supply	chain	costs,	expectations	for	lower	pricing	to maintain	competitive	positioning,	and	expectations	for	increased	marketing	investments	and	customer-driven	packaging	investments.	Our	revised	expectations were	based	on	the	completion	of	our	fourth	quarter	results,	which	were	below	management's	expectations,	and	the	development	of	our	2019	annual	operating plan	in	December	2018.	Additionally,	our	revised	expectations	were	based	on	the	development	of	our	global	five-year	operating	plan,	which	commenced	in November	2018	and	we	expect	to	be	completed	in	2019.	The	carrying	amount	of	the	Oscar	Mayer	brand	was	$6.6	billion	prior	to	its	impairment.

•We	recognized	a	$797	million	impairment	loss	related	to	the	Philadelphia	brand,	primarily	due	to	revised	2019	annual	and	future	margin	expectations,	and	to	a lesser	extent,	lower	future	positive	net	sales	growth	expectations	in	the	United	States.	Changes	in	future	year	margin	expectations	were	primarily	driven	by sustained	increases	in	supply	chain	costs	and	expectations	for	lower	pricing	to	maintain	competitive	positioning,	as	well	as	unfavorable	changes	in	product	mix and	 customer-driven	 packaging	 investments.	 Our	 revised	 expectations	 were	 based	 on	 the	 completion	 of	 our	 fourth	 quarter	 results,	 which	 were	 below management's	expectations,	and	the	development	of	our	2019	annual	operating	plan	in	December	2018.	Additionally,	our	revised	expectations	were	based	on the	development	of	our	global	five-year	operating	plan,	which	commenced	in	November	2018	and	we	expect	to	be	completed	in	2019.	The	carrying	amount	of the	Philadelphia	brand	was	$6.7	billion	prior	to	its	impairment.

•We	 recognized	 a	$168	million	 impairment	 loss	 related	 to	 the	Velveeta	brand,	primarily	due	 to	expectations	for	 lower long-term	net	sales	growth	due to anticipated	trends	in	consumer	preferences.	The	carrying	amount	of	the	Velveeta	brand	was	$2.5	billion	prior	to	its	impairment.

•We	recognized	an	$84	million	impairment	loss	related	to	the	ABC	brand,	primarily	due	to	revised	expectations	of	future	net	sales	growth	and	margins	in	the seafood	and	seasonal	cordials	categories	in	Southeast	Asia	as	well	as	foreign	exchange	rates	in	the	regions	in	which	this	brand	is	sold.	The	carrying	amount	of the	ABC	brand	was	$357	million	prior	to	its	impairment.

The	aggregate	carrying	amount	associated	with	an	additional	six	brands	(Miracle	Whip,	Planters,	A1,	Cool	Whip,	Stove	Top,	and	Quero),	which	each	had	excess	fair value	over	its	carrying	amount	of	20%	or	less,	was	$5.8	billion	as	of	December	29,	2018.

As	a	result	of	our	2017	annual	impairment	testing,	we	recognized	a	non-cash	impairment	loss	of	$49	million	in	SG&A	in	the	second	quarter	of	2017.	This	loss	was	due	to continued	declines	in	nutritional	beverages	in	India.	The	loss	was	recorded	in	our	EMEA	segment	as	the	related	trademark	is	owned	by	an	Italian	subsidiary.

Fair	value	determinations	require	considerable	judgment	and	are	sensitive	to	changes	in	underlying	assumptions,	estimates,	and	market	factors.	Estimating	the	fair	value of	 individual	brands	requires	 us	 to	 make	 assumptions	 and	 estimates	 regarding	 our	 future	 plans,	 as	 well	 as	 industry,	 economic,	 and	 regulatory	 conditions.	These assumptions	and	estimates	include	estimated	future	annual	net	cash	flows,	income	tax	considerations,	discount	rates,	growth	rates,	royalty	rates,	contributory	asset charges,	and	other	market	factors.	If	current	expectations	of	future	growth	rates	and	margins	are	not	met,	if	market	factors	outside	of	our	control,	such	as	discount	rates, change,	or	if	management's	expectations	or	plans	otherwise	change,	including	as	a	result	of	the	development	of	our	global	five-year	operating	plan,	then	one	or	more	of our	brands	might	become	impaired	in	the	future.	Our	brands	that	were	impaired	in	2018	were	written	down	to	their	respective	fair	values	resulting	in	zero	excess	fair	value over	carrying	amount	as	of	their	latest	2018	impairment	testing	dates.	Accordingly,	these	and	other	individual	brands	that	 have	20%	or	less	excess	fair	value	over carrying	amount	as	of	their	latest	testing	date	have	a	heightened	risk	of	future	impairments	if	any	assumptions,	estimates,	or	market	factors	change	in	the	future.	Brands with	a	heightened	risk	of	future	impairments	had	an	aggregate	carrying	amount	of	$29.3	billion	at	December	29,	2018	and	included:	Kraft,	Philadelphia,	Oscar	Mayer, Velveeta,	Miracle	Whip,	Planters,	A1,	Cool	Whip,	Stove	Top,	ABC, and	Quero.	Of	 the	$29.3	billion	 with	 a	 heightened	 risk	 of	 future	 impairments,	$24.0	 billion	 is attributable	to	brands	with	0%	excess	fair	value	over	carrying	amount.	Although	the	remaining	brands	have	more	than	20%	excess	fair	value	over	carrying	amount	as	of their	latest	2018	impairment	testing	date,	these	amounts	are	also	associated	with	the	2013	Heinz	acquisition	and	the	2015	Merger	and	are	recorded	on	the	balance	sheet	at their	estimated	acquisition	date	fair	values.	Therefore,	if	any	assumptions,	estimates,	or	market	factors	change	in	the	future,	these	amounts	are	also	susceptible	to impairments.

# Definite-lived	intangible	assets:

Definite-lived	intangible	assets	were	(in	millions):

|  |  | December	29,	2018 |  |  | December	30,	2017 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Gross | Accumulated\nAmortization | Net | Gross | Accumulated\nAmortization | Net |
| Trademarks | $2,474 | $(402) | $2,072 | $2,368 | $(287) | $2,081 |
| Customer-related\tassets | 4,097 | (681) | 3,416 | 4,231 | (544) | 3,687 |
| Other | 18 | (4) | 14 | 14 | (5) | 9 |
|  | $6,589 | $(1,087) | $5,502 | $6,613 | $(836) | $5,777 |

Definite-lived	intangible	asset	balances	at	December	30,	2017	reflect	the	restatements	described	in	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial Statements.

Amortization	expense	for	definite-lived	intangible	assets	was	$290	million	in	2018,	$278	million	in	2017,	and	$267	million	in	2016.	Aside	from	amortization	expense, the	changes	in	definite-lived	intangible	assets	from	December	30,	2017	to	December	29,	2018	primarily	reflect	the	reclassification	to	assets	held	for	sale	of	$96	million, additions	of	$100	million	related	to	purchase	accounting	for	Cerebos,	transfers	of	$72	million	from	indefinite-lived	intangible	assets,	impairment	losses	of	$3	million,	and foreign	currency.	The	impairment	of	definite-lived	intangible	assets	in	2018	related	to	a	trademark	which	had	a	carrying	amount	that	was	deemed	not	to	be	recoverable. This	non-cash	impairment	loss	was	recognized	in	SG&A.	Definite-lived	intangible	assets	reclassified	to	assets	held	for	sale	included	customer-related	assets	in	Canada and	India	and	certain	trademarks,	including	P'Tit	Quebec	in	Canada.	See	Note	5,	Acquisitions	and	Divestitures,	for	additional	information	related	to	our	acquisition	of Cerebos	in	2018,	as	well	as	our	assets	held	for	sale	at	December	29,	2018.

We	estimate	that	amortization	expense	related	to	definite-lived	intangible	assets	will	be	approximately	$284	million	in	2019	and	approximately	$274	million	in	each	of the	four	fiscal	years	thereafter.

# Note	11.	Income	Taxes

On	December	22,	2017,	U.S.	Tax	Reform	legislation	was	enacted	by	the	federal	government.	The	legislation	significantly	changed	U.S.	tax	laws	by,	among	other	things, lowering	the	federal	corporate	tax	rate	from	35.0%	to	21.0%,	effective	January	1,	2018	and	imposing	a	one-time	toll	charge	on	deemed	repatriated	earnings	of	foreign subsidiaries	 as	 of	 December	 30,	 2017.	 In	 addition,	 there	 were	 many	 new	 provisions,	 including	 changes	 to	 bonus	 depreciation,	 revised	 deductions	 for	 executive compensation	and	interest	expense,	a	tax	on	global	intangible	low-taxed	income	("GILTI"),	the	base	erosion	anti-abuse	tax	("BEAT"),	and	a	deduction	for	foreign- derived	intangible	income	("FDII").	While	the	corporate	tax	rate	reduction	was	effective	January	1,	2018,	we	accounted	for	this	anticipated	rate	change	in	2017,	the period	of	enactment.

Staff	Accounting	Bulletin	No.	118	issued	by	the	SEC	in	December	2017	provided	us	with	up	to	one	year	to	finalize	accounting	for	the	impacts	of	U.S.	Tax	Reform	and allowed	for	provisional	estimates	when	actual	amounts	could	not	be	determined.	As	of	December	30,	2017,	we	had	made	estimates	of	our	deferred	income	tax	benefit related	to	the	corporate	rate	change,	the	toll	charge,	certain	components	of	the	revaluation	of	deferred	tax	assets	and	liabilities,	including	depreciation	and	executive compensation,	and	a	change	in	our	indefinite	reinvestment	assertion.	In	connection	with	U.S.	Tax	Reform,	we	reassessed	our	international	investment	assertion	and	no longer	consider	the	historic	earnings	of	our	foreign	subsidiaries	as	of	December	30,	2017	to	be	indefinitely	reinvested.	We	made	an	estimate	of	local	country	withholding taxes	that	would	be	owed	when	our	historic	earnings	are	distributed.	Additionally,	we	elected	to	account	for	the	tax	on	GILTI	as	a	period	cost	and	thus	did	not	adjust	any of	the	deferred	tax	assets	and	liabilities	of	our	foreign	subsidiaries	for	U.S.	Tax	Reform.

Our	initial	accounting	for	U.S.	Tax	Reform	as	of	December	30,	2017	resulted	in	a	net	tax	benefit	of	approximately	$7.0	billion,	including	an	estimate	of	our	deferred income	tax	benefit	of	approximately	$7.5	billion	related	to	the	corporate	rate	change,	which	was	partially	offset	by	an	estimate	of	$312	million	for	the	toll	charge	and approximately	$125	million	for	other	tax	expenses,	including	a	change	in	our	indefinite	reinvestment	assertion.	Related	to	our	indefinite	reinvestment	assertion	change, we	had	recorded	an	estimate	of	deferred	tax	liabilities	of	$96	million	on	approximately	$1.2	billion	of	historic	earnings	as	of	December	30,	2017.

In	the	first	quarter	of	2018,	we	recorded	a	measurement	period	adjustment	to	reduce	income	tax	expense	and	reduce	deferred	tax	liabilities	each	by	approximately	$20 million.	We	also	recorded	insignificant	measurement	period	adjustments	in	the	second,	third,	and	fourth	quarters	of	2018.

As	of	December	29,	2018,	we	had	finalized	our	accounting	for	U.S.	Tax	Reform.	The	final	impact	(the	majority	of	which	was	recorded	in	2017,	the	period	of	enactment) was	a	net	tax	benefit	of	approximately	$7.1	billion,	including	a	deferred	tax	benefit	of	approximately	$7.5	billion	related	to	the	corporate	rate	change,	partially	offset	by tax	expense	of	$224	million	related	to	the	toll	charge	and	$120	million	for	other	tax	expenses,	including	the	deferred	tax	liability	recorded	for	changing	our	indefinite reinvestment	assertion.	Related	to	our	indefinite	reinvestment	assertion	change,	we	had	a	deferred	tax	liability	of	$111	million	on	approximately	$1.2	billion	of	historic earnings	as	of	December	30,	2017.

Additionally,	we	recorded	a	deferred	tax	liability	of	$33	million	as	of	December	29,	2018	to	reflect	our	investment	in	an	Indian	subsidiary	that	is	no	longer	considered	to be	indefinitely	reinvested.	At	the	same	time,	we	reversed	$28	million	of	deferred	tax	liabilities	related	to	local	withholding	tax	obligations.	As	of	December	29,	2018,	we have	recorded	a	deferred	tax	liability	of	$78	million	on	$1.2	billion	of	historic	earnings	related	to	local	withholding	taxes	that	will	be	owed	when	this	cash	is	distributed.

# Provision	for/(Benefit	from)	Income	Taxes:

Income/(loss)	before	income	taxes	and	the	provision	for/(benefit	from)	income	taxes,	consisted	of	the	following	(in	millions):

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Income/(loss)\tbefore\tincome\ttaxes: |  |  |  |
| United\tStates | $(10,305) | $3,811 | $3,271 |
| International | (1,016) | 1,639 | 1,668 |
| Total | $(11,321) | $5,450 | $4,939 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes: |  |  |  |
| Current: |  |  |  |
| U.S.\tfederal | $444 | $765 | $1,085 |
| U.S.\tstate\tand\tlocal | 134 | (47) | 82 |
| International | 322 | 295 | 238 |
|  | 900 | 1,013 | 1,405 |
| Deferred: |  |  |  |
| U.S.\tfederal | (1,843) | (6,590) | (11) |
| U.S.\tstate\tand\tlocal | (121) | 97 | (63) |
| International | (3) | (2) | 2 |
|  | (1,967) | (6,495) | (72) |
| Total\tprovision\tfor/(benefit\tfrom)\tincome\ttaxes | $(1,067) | $(5,482) | $1,333 |

Tax	benefits	related	to	the	exercise	of	stock	options	and	other	equity	instruments	recorded	directly	to	additional	paid-in	capital	totaled	$30	million	in	2016.	In	the	first quarter	of	2017,	we	prospectively	adopted	ASU	2016-09.	We	now	record	tax	benefits	related	to	the	exercise	of	stock	options	and	other	equity	instruments	within	our	tax provision,	rather	than	within	equity.	Accordingly,	we	recognized	a	tax	benefit	in	our	statements	of	income	of	$12	million	in	2018	and	$22	million	in	2017	related	to	tax benefits	upon	the	exercise	of	stock	options	and	other	equity	instruments.

# Effective	Tax	Rate:

The	effective	tax	rate	on	income/(loss)	before	income	taxes	differed	from	the	U.S.	federal	statutory	tax	rate	for	the	following	reasons:

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| U.S.\tfederal\tstatutory\ttax\trate | 21.0\t% | 35.0\t% | 35.0\t% |
| Tax\ton\tincome\tof\tforeign\tsubsidiaries | 3.4\t% | (4.8)% | (3.6)% |
| Domestic\tmanufacturing\tdeduction | —\t% | (1.5)% | (2.0)% |
|  | 1.6\t% | 1.1\t% | 0.8\t% |
| Tax\texempt\tincome | —\t% | (0.7)% | (3.4)% |
| Deferred\ttax\teffect\tof\tstatutory\ttax\trate\tchanges | (0.9)% | 0.3\t% | (2.0)% |
| Audit\tsettlements\tand\tchanges\tin\tuncertain\ttax\tpositions | (0.3)% | (0.2)% | 1.9\t% |
| Venezuela\tnondeductible\tdevaluation\tloss | (0.4)% | —\t% | 0.3\t% |
| U.S.\tTax\tReform\tdiscrete\tincome\ttax\tbenefit | 0.5\t% | (129.0)% | —\t% |
| Global\tintangible\tlow-taxed\tincome | (0.5)% | —\t% | —\t% |
| Goodwill\timpairment | (15.1)% | —\t% | —\t% |
| Wind-up\tof\tnon-U.S.\tpension\tplans | (0.4)% | —\t% | —\t% |
| Other | 0.5\t% | (0.8)% | —\t% |
| Effective\ttax\trate | 9.4\t% | (100.6)% | 27.0\t% |

The	provision	for	 income	 taxes	consists	of	provisions	for	federal,	state,	and	foreign	 income	 taxes.	We	operate	 in	an	 international	environment;	accordingly,	 the consolidated	effective	tax	rate	is	a	composite	rate	reflecting	the	earnings	in	various	locations	and	the	applicable	tax	rates.	Additionally,	the	calculation	of	the	percentage point	impact	of	U.S.	Tax	Reform,	tax	exempt	income,	and	other	items	on	the	effective	tax	rate	shown	in	the	table	above	are	affected	by	income/(loss)	before	income taxes.	Fluctuations	in	the	amount	of	income	generated	across	locations	around	the	world	could	impact	comparability	of	reconciling	items	between	periods.	Additionally, small	movements	in	tax	rates	due	to	a	change	in	tax	law	or	a	change	in	tax	rates	that	causes	us	to	revalue	our	deferred	tax	balances	produces	volatility	in	our	effective	tax rate.

The	2018	effective	tax	rate	was	lower,	primarily	due	to	a	decrease	in	the	U.S.	federal	statutory	rate,	non-deductible	items	(including	goodwill	impairments,	nonmonetary currency	devaluation	losses,	and	the	wind-up	of	non-U.S.	pension	plans),	the	impact	of	the	federal	tax	on	GILTI,	and	the	revaluation	of	our	deferred	tax	balances	due	to changes	in	state	tax	laws	following	U.S.	Tax	Reform,	which	were	partially	offset	by	the	benefit	from	intangible	asset	impairment	losses	in	the	fourth	quarter	of	2018.	See Note	10,	Goodwill	and	Intangible	Assets,	for	additional	information	related	to	our	impairment	losses	in	the	fourth	quarter	of	2018.

The	tax	provision	for	the	2017	tax	year	benefited	from	U.S.	Tax	Reform	enacted	on	December	22,	2017.	The	related	income	tax	benefit	of	129.0%	in	2017	primarily reflects	adjustments	to	our	deferred	tax	positions	for	the	lower	federal	income	tax	rate,	partially	offset	by	our	provision	for	the	one-time	toll	charge.

The	tax	provision	for	the	2016	tax	year	included	a	benefit	related	to	the	tax	effect	of	statutory	tax	rate	changes,	including	a	benefit	related	to	the	impact	on	deferred	taxes of	a	10-basis-point	reduction	in	the	state	tax	rate	and	a	100-basis-point	statutory	rate	reduction	in	the	United	Kingdom.

# Deferred	Income	Tax	Assets	and	Liabilities:

The	tax	effects	of	temporary	differences	and	carryforwards	that	gave	rise	to	deferred	income	tax	assets	and	liabilities	consisted	of	the	following	(in	millions):

|  | December	29,	2018 | December	30,	2017 |
| :--- | :--- | :--- |
| Deferred\tincome\ttax\tliabilities: |  |  |
| Intangible\tassets,\tnet | $11,571 | $13,567 |
| Property,\tplant\tand\tequipment,\tnet | 735 | 676 |
| Other | 410 | 288 |
| Deferred\tincome\ttax\tliabilities | 12,716 | 14,531 |
| Deferred\tincome\ttax\tassets: |  |  |
| Benefit\tplans | (172) | (212) |
| Other | (470) | (422) |
| Deferred\tincome\ttax\tassets | (642) | (634) |
| Valuation\tallowance | 81 | 80 |
| Net\tdeferred\tincome\ttax\tliabilities | $12,155 | $13,977 |

At	December	29,	2018,	deferred	income	tax	liabilities	excluded	amounts	classified	as	held	for	sale.	See	Note	5,	Acquisitions	and	Divestitures,	for	additional	information.

The	decrease	in	deferred	tax	liabilities	from	December	30,	2017	to	December	29,	2018	was	primarily	driven	by	intangible	asset	impairment	losses	recorded	in	the	fourth quarter	of	2018.	See	Note	10,	Goodwill	and	Intangible	Assets,	for	additional	information.

At	December	29,	2018,	foreign	operating	loss	carryforwards	totaled	$307	million.	Of	that	amount,	$26	million	expire	between	2019	and	2038;	the	other	$281	million	do not	expire.	We	have	recorded	$86	million	of	deferred	tax	assets	related	to	these	foreign	operating	loss	carryforwards.	Deferred	tax	assets	of	$90	million	have	been recorded	for	U.S.	state	and	local	operating	loss	carryforwards.	These	losses	expire	between	2019	and	2038.

# Uncertain	Tax	Positions:

At	December	29,	2018,	our	unrecognized	tax	benefits	for	uncertain	tax	positions	were	$387	million.	If	we	had	recognized	all	of	these	benefits,	the	impact	on	our	effective tax	rate	would	have	been	$352	million.	It	is	reasonably	possible	that	our	unrecognized	tax	benefits	will	decrease	by	as	much	as	$54	million	in	the	next	12	months primarily	due	to	the	progression	of	federal,	state,	and	foreign	audits	in	process.	Our	unrecognized	tax	benefits	for	uncertain	tax	positions	are	included	in	income	taxes payable	and	other	non-current	liabilities	on	our	consolidated	balance	sheets.

The	changes	in	our	unrecognized	tax	benefits	were	(in	millions):

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Balance\tat\tthe\tbeginning\tof\tthe\tperiod | $408 | $389 | $353 |
| Increases\tfor\ttax\tpositions\tof\tprior\tyears | 9 | 2 | 59 |
| Decreases\tfor\ttax\tpositions\tof\tprior\tyears | (81) | (35) | (18) |
| Increases\tbased\ton\ttax\tpositions\trelated\tto\tthe\tcurrent\tyear | 74 | 135 | 62 |
| Decreases\tdue\tto\tsettlements\twith\ttaxing\tauthorities | (3) | (59) | (62) |
| Decreases\tdue\tto\tlapse\tof\tstatute\tof\tlimitations | (10) | (24) | (5) |
| Reclassified\tto\tliabilities\theld\tfor\tsale | (10) | — | — |
| Balance\tat\tthe\tend\tof\tthe\tperiod | $387 | $408 | $389 |

Our	unrecognized	tax	benefits	decreased	during	2018	mainly	as	a	result	of	audit	settlements	with	federal,	state,	and	foreign	taxing	authorities	and	statute	of	limitations expirations.	Our	unrecognized	tax	benefits	increased	during	2017	as	a	result	of	evaluating	tax	positions	taken	or	expected	to	be	taken	on	our	federal,	state,	and	foreign income	tax	returns.

In	2016,	we	reached	an	agreement	with	the	IRS	resolving	all	Kraft	open	matters	related	to	the	audits	of	taxable	years	2012	through	2014.	This	settlement	reduced	our reserves	for	uncertain	tax	positions	and	resulted	in	a	non-cash	tax	benefit	of	$42	million.

We	include	interest	and	penalties	related	to	uncertain	tax	positions	in	our	tax	provision.	Our	provision	for/(benefit	from)	income	taxes	included	a	$5	million	expense	in 2018,	$24	million	benefit	in	2017,	and	$8	million	expense	in	2016	related	to	interest	and	penalties.	Accrued	interest	and	penalties	were	$62	million	as	of	December	29, 2018	and	$57	million	as	of	December	30,	2017.

# Other	Income	Tax	Matters:

In	the	normal	course	of	business,	we	are	subject	to	examination	by	taxing	authorities	throughout	the	world,	including	such	major	jurisdictions	as	Australia,	Canada,	Italy, the	Netherlands,	the	United	Kingdom,	and	the	United	States.	As	of	December	29,	2018,	we	have	substantially	concluded	all	national	income	tax	matters	through	2016 for	the	Netherlands,	through	2014	for	the	United	States,	through	2012	for	the	United	Kingdom,	through	2011	for	Australia,	Canada,	and	Italy.	We	have	substantially concluded	all	state	income	tax	matters	through	2007.	Additionally,	as	of	April	2019,	we	had	substantially	concluded	all	national	income	tax	matters	through	2015	for	the United	States.

We	have	a	tax	sharing	agreement	with	Mondelēz	International,	Inc.	("Mondelēz	International"),	which	generally	provides	that	(i)	we	are	liable	for	U.S.	state	income taxes	and	Canadian	federal	and	provincial	income	taxes	for	Kraft	periods	prior	to	October	1,	2012	and	(ii)	Mondelēz	International	is	responsible	for	U.S.	federal	income taxes	and	substantially	all	non-U.S.	income	taxes,	excluding	Canadian	income	taxes,	for	Kraft	periods	prior	to	October	1,	2012.

Kraft's	U.S.	operations	were	included	in	Mondelēz	International's	U.S.	federal	consolidated	income	tax	returns	for	tax	periods	through	October	1,	2012.	In	December 2016,	Mondelēz	International	reached	a	final	resolution	on	a	U.S.	federal	income	tax	audit	of	the	2010-2012	tax	years.	As	noted	above,	we	are	indemnified	for	U.S. federal	income	taxes	related	to	these	periods.

# Note	12.	Employees'	Stock	Incentive	Plans

We	grant	equity	awards,	including	stock	options,	restricted	stock	units	("RSUs"),	and	performance	share	units	("PSUs"),	to	select	employees	to	provide	long-term performance	incentives	to	our	employees.	As	a	result	of	the	failure	to	remain	current	in	our	reporting	requirements	with	the	SEC,	we	are	not	currently	eligible	to	use Form	S-8	registration	statements.

# Stock	Plans

We	had	activity	related	to	equity	awards	from	the	following	plans	in	2018,	2017,	and	2016:

# 2016	Omnibus	Incentive	Plan:

In	April	2016,	our	Board	of	Directors	approved	the	2016	Omnibus	Incentive	Plan	("2016	Omnibus	Plan"),	which	authorized	grants	of	options,	stock	appreciation	rights, RSUs,	deferred	stock,	performance	awards,	investment	rights,	other	stock-based	awards,	and	cash-based	awards.	This	plan	authorizes	the	issuance	of	up	to	18	million shares	of	our	common	stock.	Equity	awards	granted	under	the	2016	Omnibus	Plan	generally	have	a	five-year	cliff	vest	period,	and	non-qualified	stock	options	have	a maximum	exercise	term	of	10	years.	Equity	awards	granted	under	the	2016	Omnibus	Plan	since	inception	include	non-qualified	stock	options,	RSUs,	and	PSUs.

Prior	to	approval	of	the	2016	Omnibus	Plan,	we	issued	non-qualified	stock	options	to	select	employees	under	the	2013	Omnibus	Incentive	Plan	("2013	Omnibus	Plan").

As	a	result	of	the	2015	Merger,	each	outstanding	Heinz	stock	option	was	converted	into	0.443332	of	a	Kraft	Heinz	stock	option.	Following	this	conversion,	the	2013 Omnibus	Plan	authorized	the	issuance	of	up	to	17,555,947	shares	of	our	common	stock.	Non-qualified	stock	options	awarded	under	the	2013	Omnibus	Plan	have	a	five- year	cliff	vest	period	and	a	maximum	exercise	term	of	10	years.	These	non-qualified	stock	options	will	continue	to	vest	and	become	exercisable	in	accordance	with	the terms	and	conditions	of	the	2013	Omnibus	Plan	and	the	relevant	award	agreements.

# Kraft	2012	Performance	Incentive	Plan:

Prior	to	the	2015	Merger,	Kraft	issued	equity-based	awards,	including	stock	options	and	RSUs,	under	its	2012	Performance	Incentive	Plan.	As	a	result	of	the	2015 Merger,	each	outstanding	Kraft	stock	option	was	converted	into	an	option	to	purchase	a	number	of	shares	of	our	common	stock	based	upon	an	option	adjustment	ratio, and	each	outstanding	Kraft	RSU	was	converted	into	one	Kraft	Heinz	RSU.	These	Kraft	Heinz	equity	awards	will	continue	to	vest	and	become	exercisable	in	accordance with	the	terms	and	conditions	that	were	applicable	immediately	prior	to	the	completion	of	the	2015	Merger.	These	options	generally	become	exercisable	in	three	annual installments	beginning	on	 the	first	anniversary	of	 the	original	grant	date,	and	have	a	maximum	exercise	 term	of	10	years.	RSUs	generally	cliff	vest	on	the	third anniversary	of	the	original	grant	date.	In	accordance	with	the	terms	of	the	2012	Performance	Incentive	Plan,	vesting	generally	accelerates	for	holders	of	Kraft	awards who	are	terminated	without	cause	within	two	years	of	the	2015	Merger	Date.

In	 addition,	 prior	 to	 the	 2015	 Merger,	 Kraft	 issued	 performance-based,	 long-term	 incentive	 awards	 ("Performance	 Shares"),	 which	 vested	 based	 on	 varying performance,	market,	and	service	conditions.	In	connection	with	the	2015	Merger,	all	outstanding	Performance	Shares	were	converted	into	cash	awards,	payable	in	two installments:	(i)	a	2015	pro-rata	payment	based	upon	the	portion	of	the	Performance	Share	cycle	completed	prior	to	the	2015	Merger	and	(ii)	the	remaining	value	of	the award	to	be	paid	on	the	earlier	of	the	first	anniversary	of	the	closing	of	the	2015	Merger	and	a	participant's	termination	without	cause.

# Stock	Options

We	use	the	Black-Scholes	model	to	estimate	the	fair	value	of	stock	option	grants.	Our	weighted	average	Black-Scholes	fair	value	assumptions	were:

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Risk-free\tinterest\trate | 2.75% | 2.25% | 1.63% |
| Expected\tterm | 7.5\tyears | 7.5\tyears | 7.5\tyears |
| Expected\tvolatility | 21.3% | 19.6% | 22.0% |
| Expected\tdividend\tyield | 3.6% | 2.8% | 3.1% |
| Weighted\taverage\tgrant\tdate\tfair\tvalue\tper\tshare | $10.26 | $14.24 | $12.48 |

The	risk-free	interest	rate	represented	the	constant	maturity	U.S.	Treasury	rate	in	effect	at	the	grant	date,	with	a	remaining	term	equal	to	the	expected	life	of	the	options. The	expected	life	is	the	period	over	which	our	employees	are	expected	to	hold	their	options.	Due	to	the	lack	of	historical	data,	we	calculated	expected	life	using	the	Safe Harbor	method,	which	uses	the	weighted	average	vesting	period	and	the	contractual	term	of	the	options.	In	2018,	we	estimated	volatility	using	a	blended	volatility approach	of	term-matched	historical	volatility	from	our	daily	stock	prices	and	weighted	average	implied	volatility.	In	2017	and	2016,	we	estimated	volatility	using	a blended	approach	of	implied	volatility	and	peer	volatility.	We	calculated	peer	volatility	as	the	average	of	the	term-matched,	leverage-adjusted	historical	volatilities	of Colgate-Palmolive	Co.,	The	Coca-Cola	Company,	Mondelēz	International,	Altria	Group,	Inc.,	PepsiCo,	Inc.,	and	Unilever	plc.	We	estimated	the	expected	dividend	yield using	the	quarterly	dividend	divided	by	the	three-month	average	stock	price,	annualized	and	continuously	compounded.

Our	stock	option	activity	and	related	information	was:

|  | Number	of	Stock<br>Options | Weighted	Average<br>Exercise	Price<br>(per	share) | Aggregate	Intrinsic<br>Value<br>(in	millions) | Average	Remaining<br>Contractual	Term |
| :--- | :--- | :--- | :--- | :--- |
| Outstanding\tat\tDecember\t30,\t2017 | 19,289,564 | $41.63 |  |  |
| Granted | 2,143,730 | 64.37 |  |  |
| Forfeited | (1,136,924) | 61.10 |  |  |
| Exercised | (2,036,405) | 27.68 |  |  |
| Outstanding\tat\tDecember\t29,\t2018 | 18,259,965 | 44.64 | $168 | 6\tyears |
| Exercisable\tat\tDecember\t29,\t2018 | 10,492,048 | 33.48 | 124 | 4\tyears |

The	aggregate	intrinsic	value	of	stock	options	exercised	during	the	period	was	$67	million	in	2018,	$124	million	in	2017,	and	$186	million	in	2016.

Our	unvested	stock	options	and	related	information	was:

|  | Number	of	Stock	Options | Weighted	Average	Grant	Date<br>Fair	Value<br>(per	share) |
| :--- | :--- | :--- |
| Unvested\toptions\tat\tDecember\t30,\t2017 | 11,827,142 | $8.36 |
| Granted | 2,143,730 | 10.26 |
| Vested | (5,135,897) | 5.99 |
| Forfeited | (1,067,058) | 10.45 |
| Unvested\toptions\tat\tDecember\t29,\t2018 | 7,767,917 | 10.16 |

# Restricted	Stock	Units

RSUs	represent	a	right	to	receive	one	share	or	the	value	of	one	share	upon	the	terms	and	conditions	set	forth	in	the	plan	and	the	applicable	award	agreement.

We	used	the	stock	price	on	the	grant	date	to	estimate	the	fair	value	of	our	RSUs.	Certain	of	our	RSUs	are	not	dividend-eligible.	We	discounted	the	fair	value	of	these RSUs	 based	 on	 the	 dividend	 yield.	 Dividend	 yield	 was	 estimated	 using	 the	 quarterly	 dividend	 divided	 by	 the	 three-month	 average	 stock	 price,	 annualized	 and continuously	compounded.	The	grant	date	fair	value	of	RSUs	is	amortized	to	expense	over	the	vesting	period.

Our	RSU	activity	and	related	information	was:

|  | Number	of	Units | Weighted	Average<br>Grant	Date	Fair<br>Value<br>(per	share) |
| :--- | :--- | :--- |
| Outstanding\tat\tDecember\t30,\t2017 | 1,284,262 | $81.91 |
| Granted | 1,443,088 | 58.59 |
| Forfeited | (253,249) | 77.42 |
| Vested | (135,143) | 73.57 |
| Outstanding\tat\tDecember\t29,\t2018 | 2,338,958 | 68.49 |

# Performance	Share	Units

PSUs	represent	a	right	to	receive	one	share	or	the	value	of	one	share	upon	the	terms	and	conditions	set	forth	in	the	plan	and	the	applicable	award	agreement	and	are subject	to	achievement	or	satisfaction	of	performance	conditions	specified	by	the	Compensation	Committee	of	our	Board	of	Directors.

We	used	the	stock	price	on	the	grant	date	to	estimate	the	fair	value	of	our	PSUs.	None	of	our	PSUs	are	dividend-eligible;	therefore,	we	discounted	the	fair	value	of	our PSUs	 based	 on	 the	 dividend	 yield.	 Dividend	 yield	 was	 estimated	 using	 the	 quarterly	 dividend	 divided	 by	 the	 three-month	 average	 stock	 price,	 annualized	 and continuously	compounded.	The	grant	date	fair	value	of	PSUs	is	amortized	to	expense	over	the	vesting	period.	We	adjust	the	expense	based	on	the	likelihood	of	future achievement	of	performance	metrics.

Our	PSU	activity	and	related	information	was:

|  | Number	of	Units | Weighted	Average<br>Grant	Date	Fair<br>Value<br>(per	share) |
| :--- | :--- | :--- |
| Outstanding\tat\tDecember\t30,\t2017 | 815,383 | $70.16 |
| Granted | 2,730,130 | 56.31 |
| Forfeited | (293,457) | 62.28 |
| Outstanding\tat\tDecember\t29,\t2018 | 3,252,056 | 59.24 |

# Total	Equity	Awards

Equity	award	compensation	cost	and	the	related	tax	benefit	was	(in	millions):

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Pre-tax\tcompensation\tcost | $33 | $46 | $46 |
| Related\ttax\tbenefit | (7) | (14) | (15) |
| After-tax\tcompensation\tcost | $26 | $32 | $31 |

Unrecognized	compensation	cost	related	to	unvested	equity	awards	was	$149	million	at	December	29,	2018	and	is	expected	to	be	recognized	over	a	weighted	average period	of	four	years.

# Note	13.	Postemployment	Benefits

As	noted	above,	as	a	result	of	the	failure	to	remain	current	in	our	reporting	requirements	with	the	SEC,	we	are	not	currently	eligible	to	use	Form	S-8	registration statements.	As	a	result,	on	April	23,	2019,	the	administrator	of	the	Kraft	Heinz	Savings	Plan	and	the	Kraft	Heinz	Union	Savings	Plan	(collectively,	the	"Plan")	issued	a notice	to	Plan	participants	advising	participants	of	a	blackout	period	during	which	participants	are	prohibited	from	acquiring	beneficial	ownership	of	additional	interests in	The	Kraft	Heinz	Company	Stock	Fund.	If	we	are	not	able	to	become	and	remain	current	in	our	reporting	requirements	with	the	SEC,	it	restricts	our	ability	to	maintain The	Kraft	Heinz	Company	Stock	Fund	or	issue	other	equity	securities	to	our	employees.

We	maintain	various	retirement	plans	for	the	majority	of	our	employees.	Current	defined	benefit	pension	plans	are	provided	primarily	for	certain	domestic	union	and foreign	employees.	Local	statutory	requirements	govern	many	of	these	plans.	The	pension	benefits	of	our	unionized	workers	are	in	accordance	with	the	applicable collective	bargaining	agreement	covering	their	employment.	Defined	contribution	plans	are	provided	for	certain	domestic	unionized,	non-union	hourly,	and	salaried employees	as	well	as	certain	employees	in	foreign	locations.

We	provide	health	care	and	other	postretirement	benefits	to	certain	of	our	eligible	retired	employees	and	their	eligible	dependents.	Certain	of	our	U.S.	and	Canadian employees	may	become	eligible	for	such	benefits.	We	may	modify	plan	provisions	or	terminate	plans	at	our	discretion.	The	postretirement	benefits	of	our	unionized workers	are	in	accordance	with	the	applicable	collective	bargaining	agreement	covering	their	employment.

# We	remeasure	our	postemployment	benefit	plans	at	least	annually.

We	capitalize	a	portion	of	net	pension	and	postretirement	cost/(benefit)	into	inventory	based	on	our	production	activities.	Beginning	January	1,	2018,	only	the	service cost	component	of	net	pension	and	postretirement	cost/(benefit)	is	capitalized	into	inventory.	As	part	of	the	adoption	of	ASU	2017-07	in	the	first	quarter	of	2018,	we recognized	a	one-time	favorable	credit	of	$42	million	within	cost	of	products	sold	related	to	amounts	that	were	previously	capitalized	into	inventory.	Included	in	this credit	was	$28	million	related	to	prior	service	credits	that	were	previously	capitalized	to	inventory.

# Pension	Plans

In	2018,	we	settled	our	Canadian	salaried	and	Canadian	hourly	defined	benefit	pension	plans,	which	resulted	in	settlement	charges	of	$162	million	for	the	year	ended December	29,	2018.	Additionally,	the	settlement	of	these	plans	impacted	the	projected	benefit	obligation,	accumulated	benefit	obligation,	fair	value	of	plan	assets,	and service	costs	associated	with	our	non-U.S.	pension	plans.

We	had	approved	the	wind-up	of	the	Canadian	salaried	and	Canadian	hourly	defined	benefit	pension	plans	in	2016,	and	the	wind-up	was	effective	on	December	31, 2016.	This	action	resulted	in	an	increase	to	our	projected	benefit	obligations	of	approximately	$85	million	at	December	31,	2016.	This	action	had	no	impact	on	the consolidated	statements	of	income	or	consolidated	statements	of	cash	flows	for	the	year	ended	December	31,	2016.

# Obligations	and	Funded	Status:

The	projected	benefit	obligations,	fair	value	of	plan	assets,	and	funded	status	of	our	pension	plans	were	(in	millions):

|  | December	29,	2018 | December	30,	2017 | December	29,	2018 | December	30,	2017 |
| :--- | :--- | :--- | :--- | :--- |
| Benefit\tobligation\tat\tbeginning\tof\tyear | $4,719 | $5,157 | $3,464 | $3,099 |
| Service\tcost | 10 | 11 | 19 | 19 |
| Interest\tcost | 158 | 178 | 67 | 66 |
| Benefits\tpaid | (191) | (224) | (126) | (161) |
| Actuarial\tlosses/(gains) | (447) | 270 | (118) | 120 |
| Plan\tamendments | 1 | — | 14 | (2) |
| Currency | — | — | (175) | 264 |
| Settlements | (190) | (692) | (1,221) | (1) |
| Curtailments | — | — | (1) | — |
| Special/contractual\ttermination\tbenefits | — | 19 | 7 | 9 |
| Other | — | — | — | 51 |
| Benefit\tobligation\tat\tend\tof\tyear | 4,060 | 4,719 | 1,930 | 3,464 |
| Fair\tvalue\tof\tplan\tassets\tat\tbeginning\tof\tyear | 4,785 | 4,788 | 4,156 | 3,628 |
| Actual\treturn\ton\tplan\tassets | (185) | 613 | 49 | 289 |
| Employer\tcontributions | — | 300 | 57 | 30 |
| Benefits\tpaid | (191) | (224) | (126) | (161) |
| Currency | — | — | (221) | 322 |
| Settlements | (190) | (692) | (1,221) | (1) |
| Other | — | — | (5) | 49 |
| Fair\tvalue\tof\tplan\tassets\tat\tend\tof\tyear | 4,219 | 4,785 | 2,689 | 4,156 |
| Net\tpension\tliability/(asset)\trecognized\tat\tend\tof\tyear | $(159) | $(66) | $(759) | $(692) |

The	accumulated	benefit	obligation,	which	represents	benefits	earned	to	the	measurement	date,	was	$4.1	billion	at	December	29,	2018	and	$4.7	billion	at	December	30, 2017	 for	 the	 U.S.	 pension	 plans.	The	 accumulated	 benefit	 obligation	 for	 the	 non-U.S.	 pension	 plans	 was	$1.7	billion	 at	December	29,	2018	 and	$3.3	 billion	 at December	30,	2017.

The	combined	U.S.	and	non-U.S.	pension	plans	resulted	in	net	pension	assets	of	$918	million	 at	December	29,	2018 and	$758	million at	December	30,	2017.	We recognized	these	amounts	on	our	consolidated	balance	sheets	as	follows	(in	millions):

For	certain	of	our	U.S.	and	non-U.S.	plans	that	were	underfunded	based	on	accumulated	benefit	obligations	in	excess	of	plan	assets,	the	projected	benefit	obligations, accumulated	benefit	obligations,	and	the	fair	value	of	plan	assets	were	(in	millions):

|  | U.S.	Plans | U.S.	Plans | Non-U.S.	Plans |  |
| :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\t2018 | December\t30,\t2017 | December\t29,\t2018 | December\t30,\t2017 |
| Projected\tbenefit\tobligation | $— | $— | $146 | $1,368 |
| Accumulated\tbenefit\tobligation | — | — | 139 | 1,360 |
| Fair\tvalue\tof\tplan\tassets | — | — | 65 | 1,254 |

All	of	our	U.S.	plans	were	overfunded	based	on	plan	assets	in	excess	of	accumulated	benefit	obligations	as	of	December	29,	2018	and	December	30,	2017.

For	certain	of	our	U.S.	and	non-U.S.	plans	that	were	underfunded	based	on	projected	benefit	obligations	in	excess	of	plan	assets,	the	projected	benefit	obligations, accumulated	benefit	obligations,	and	the	fair	value	of	plan	assets	were	(in	millions):

|  | U.S.	Plans | U.S.	Plans | Non-U.S.	Plans |  |
| :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\t2018 | December\t30,\t2017 | December\t29,\t2018 | December\t30,\t2017 |
| Projected\tbenefit\tobligation | $— | $— | $148 | $1,400 |
| Accumulated\tbenefit\tobligation | — | — | 141 | 1,392 |
| Fair\tvalue\tof\tplan\tassets | — | — | 67 | 1,287 |

All	of	our	U.S.	plans	were	overfunded	based	on	plan	assets	in	excess	of	projected	benefit	obligations	as	of	December	29,	2018	and	December	30,	2017.

We	used	the	following	weighted	average	assumptions	to	determine	our	projected	benefit	obligations	under	the	pension	plans:

|  | U.S.	Plans |  | Non-U.S.	Plans |  |
| :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\t2018 | December\t30,\t2017 | December\t29,\t2018 | December\t30,\t2017 |
| Discount\trate | 4.4% | 3.7% | 2.9% | 2.4% |
| Rate\tof\tcompensation\tincrease | 4.1% | 4.1% | 3.9% | 3.9% |

Discount	rates	for	our	U.S.	and	non-U.S.	plans	were	developed	from	a	model	portfolio	of	high	quality,	fixed-income	debt	instruments	with	durations	that	match	the expected	future	cash	flows	of	the	plans.

# Components	of	Net	Pension	Cost/(Benefit):

Net	pension	cost/(benefit)	consisted	of	the	following	(in	millions):

|  |  | U.S.	Plans |  |  | Non-U.S.	Plans |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\n2018 | December\t30,\n2017 | December\t31,\n2016 | December\t29,\n2018 | December\t30,\n2017 | December\t31,\n2016 |
| Service\tcost | $10 | $11 | $13 | $19 | $19 | $25 |
| Interest\tcost | 158 | 178 | 203 | 67 | 66 | 87 |
| Expected\treturn\ton\tplan\tassets | (247) | (262) | (290) | (175) | (180) | (182) |
| Amortization\tof\tunrecognized\tlosses/(gains) | — | — | — | 2 | 1 | — |
| Settlements | (4) | 2 | 23 | 158 | — | 2 |
| Curtailments | — | — | — | (1) | — | — |
| Special/contractual\ttermination\tbenefits | — | 19 | — | 7 | 9 | 3 |
| Other | — | 2 | — | — | (15) | — |
| Net\tpension\tcost/(benefit) | $(83) | $(50) | $(51) | $77 | $(100) | $(65) |

We	present	all	non-service	cost	components	of	net	pension	cost/(benefit)	within	other	expense/(income),	net	on	our	consolidated	statements	of	income.

We	used	the	following	weighted	average	assumptions	to	determine	our	net	pension	costs:

|  |  | U.S.	Plans |  |  | Non-U.S.	Plans |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\n2018 | December\t30,\n2017 | December\t31,\n2016 | December\t29,\n2018 | December\t30,\n2017 | December\t31,\n2016 |
| Discount\trate\t-\tService\tcost | 3.8% | 4.2% | 4.5% | 3.0% | 3.2% | 4.2% |
| Discount\trate\t-\tInterest\tcost | 3.6% | 3.6% | 3.5% | 2.9% | 2.1% | 3.3% |
| Expected\trate\tof\treturn\ton\tplan\tassets | 5.5% | 5.7% | 5.7% | 4.5% | 4.8% | 5.6% |
| Rate\tof\tcompensation\tincrease | 4.1% | 4.1% | 4.1% | 3.9% | 4.0% | 3.4% |

Discount	rates	for	our	U.S.	and	non-U.S.	plans	were	developed	from	a	model	portfolio	of	high	quality,	fixed-income	debt	instruments	with	durations	that	match	the expected	future	cash	flows	of	the	plans.	We	determine	our	expected	rate	of	return	on	plan	assets	from	the	plan	assets'	historical	long-term	investment	performance, target	asset	allocation,	and	estimates	of	future	long-term	returns	by	asset	class.

# Plan	Assets:

The	underlying	basis	of	the	investment	strategy	of	our	defined	benefit	plans	is	to	ensure	that	pension	funds	are	available	to	meet	the	plans'	benefit	obligations	when	they are	due.	Our	investment	objectives	include:	investing	plan	assets	in	a	high-quality,	diversified	manner	in	order	to	maintain	the	security	of	the	funds;	achieving	an optimal	return	on	plan	assets	within	specified	risk	tolerances;	and	investing	according	to	local	regulations	and	requirements	specific	to	each	country	in	which	a	defined benefit	plan	operates.	The	investment	strategy	expects	equity	investments	to	yield	a	higher	return	over	the	long	term	than	fixed-income	securities,	while	fixed-income securities	are	expected	to	provide	certain	matching	characteristics	to	the	plans'	benefit	payment	cash	flow	requirements.	Our	investment	policy	specifies	the	type	of investment	vehicles	appropriate	for	the	applicable	plan,	asset	allocation	guidelines,	criteria	for	the	selection	of	investment	managers,	procedures	to	monitor	overall investment	performance	as	well	as	investment	manager	performance.	It	also	provides	guidelines	enabling	the	applicable	plan	fiduciaries	to	fulfill	their	responsibilities.

Our	weighted	average	asset	allocations	were:

|  |  | U.S.	Plans | Non-U.S.	Plans |  |
| :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\t2018 | December\t30,\t2017 | December\t29,\t2018 | December\t30,\t2017 |
| Fixed-income\tsecurities | 84% | 62% | 45% | 39% |
| Equity\tsecurities | 14% | 27% | 34% | 27% |
| Cash\tand\tcash\tequivalents | 2% | 11% | 16% | 4% |
| Real\testate | —% | —% | 3% | 6% |
| Certain\tinsurance\tcontracts | —% | —% | 2% | 24% |
| Total | 100% | 100% | 100% | 100% |

Our	pension	investment	strategy	for	U.S.	plans	is	designed	to	align	our	pension	assets	with	our	projected	benefit	obligation	to	reduce	volatility	by	targeting	an	investment of	approximately	85%	of	our	U.S.	plan	assets	in	fixed-income	securities	and	approximately	15%	in	return-seeking	assets,	primarily	equity	securities.

For	pension	plans	outside	the	United	States,	our	investment	strategy	is	subject	to	local	regulations	and	the	asset/liability	profiles	of	the	plans	in	each	individual	country. In	aggregate,	the	long-term	asset	allocation	targets	of	our	non-U.S.	plans	are	broadly	characterized	as	a	mix	of	approximately	65%	fixed-income	securities	and	annuity contracts,	and	approximately	35%	in	return-seeking	assets,	primarily	equity	securities	and	real	estate.

The	fair	value	of	pension	plan	assets	at	December	29,	2018	was	determined	using	the	following	fair	value	measurements	(in	millions):

| Asset	Category | Total	Fair	Value | Quoted	Prices	in	Active<br>Markets	for	Identical<br>Assets<br>(Level	1) | Significant	Other<br>Observable	Inputs<br>(Level	2) | Significant	Unobservable<br>Inputs<br>(Level	3) |
| :--- | :--- | :--- | :--- | :--- |
| Corporate\tbonds\tand\tother\tfixed-income\tsecurities | $3,089 | $— | $3,089 | $— |
| Government\tbonds | 366 | 366 | — | — |
| Total\tfixed-income\tsecurities | 3,455 | 366 | 3,089 | — |
| Equity\tsecurities | 665 | 665 | — | — |
| Cash\tand\tcash\tequivalents | 422 | 419 | 3 | — |
| Real\testate | 79 | — | — | 79 |
| Certain\tinsurance\tcontracts | 53 | — | — | 53 |
| Fair\tvalue\texcluding\tinvestments\tmeasured\tat\tnet\tasset\tvalue | 4,674 | 1,450 | 3,092 | 132 |
| Investments\tmeasured\tat\tnet\tasset\tvalue(a) | 2,234 |  |  |  |
| Total\tplan\tassets\tat\tfair\tvalue | $6,908 |  |  |  |

(a) Amount	includes	cash	collateral	of	$269	million	associated	with	our	securities	lending	program,	which	is	reflected	as	an	asset,	and	a	corresponding	securities	lending	payable	of $269	million, which	is	reflected	as	a	liability.	The	net	impact	on	total	plan	assets	at	fair	value	is	zero.

The	fair	value	of	pension	plan	assets	at	December	30,	2017	was	determined	using	the	following	fair	value	measurements	(in	millions):

| Asset	Category | Total	Fair	Value | Quoted	Prices	in	Active<br>Markets	for	Identical<br>Assets<br>(Level	1) | Significant	Other<br>Observable	Inputs<br>(Level	2) | Significant	Unobservable<br>Inputs<br>(Level	3) |
| :--- | :--- | :--- | :--- | :--- |
| Corporate\tbonds\tand\tother\tfixed-income\tsecurities | $2,606 | $— | $2,606 | $— |
| Government\tbonds | 467 | 467 | — | — |
| Total\tfixed-income\tsecurities | 3,073 | 467 | 2,606 | — |
| Equity\tsecurities | 1,044 | 1,044 | — | — |
| Cash\tand\tcash\tequivalents | 208 | 205 | 3 | — |
| Real\testate | 262 | — | — | 262 |
| Certain\tinsurance\tcontracts | 983 | — | — | 983 |
| Fair\tvalue\texcluding\tinvestments\tmeasured\tat\tnet\tasset\tvalue | 5,570 | 1,716 | 2,609 | 1,245 |
| Investments\tmeasured\tat\tnet\tasset\tvalue(a) | 3,371 |  |  |  |
| Total\tplan\tassets\tat\tfair\tvalue | $8,941 |  |  |  |

The	following	section	describes	the	valuation	methodologies	used	to	measure	the	fair	value	of	pension	plan	assets,	including	an	indication	of	the	level	in	the	fair	value hierarchy	in	which	each	type	of	asset	is	generally	classified.

Corporate	Bonds	and	Other	Fixed-Income	Securities.	These	securities	consist	of	publicly	traded	U.S.	and	non-U.S.	fixed	interest	obligations	(principally	corporate bonds).	Such	investments	are	valued	through	consultation	and	evaluation	with	brokers	in	the	institutional	market	using	quoted	prices	and	other	observable	market	data. As	such,	these	securities	are	included	in	Level	2.

Government	Bonds.	These	securities	consist	of	direct	investments	in	publicly	traded	U.S.	fixed	interest	obligations	(principally	debentures).	Such	investments	are	valued using	quoted	prices	in	active	markets.	These	securities	are	included	in	Level	1.

Equity	Securities.	These	securities	consist	of	direct	investments	in	the	stock	of	publicly	traded	companies.	Such	investments	are	valued	based	on	the	closing	price reported	in	an	active	market	on	which	the	individual	securities	are	traded.	As	such,	the	direct	investments	are	classified	as	Level	1.

Cash	and	Cash	Equivalents.	This	consists	of	direct	cash	holdings	and	institutional	short-term	investment	vehicles.	Direct	cash	holdings	are	valued	based	on	cost,	which approximates	fair	value	and	are	classified	as	Level	1.	Certain	institutional	short-term	investment	vehicles	are	valued	daily	and	are	classified	as	Level	1.	Other	cash equivalents	that	are	not	traded	on	an	active	exchange,	such	as	bank	deposits,	are	classified	as	Level	2.

Real	Estate.	These	holdings	consist	of	real	estate	investments	and	are	generally	classified	as	Level	3.

Certain	 Insurance	 Contracts.	This	category	consists	of	group	annuity	contracts	that	have	been	purchased	to	cover	a	portion	of	the	plan	members	and	have	been classified	as	Level	3.

Investments	Measured	at	Net	Asset	Value.	This	category	consists	of	pooled	funds,	short-term	investments	and	partnership/corporate	feeder	interests.

•Pooled	funds.	The	fair	values	of	participation	units	held	in	collective	trusts	are	based	on	their	net	asset	values,	as	reported	by	the	managers	of	the	collective	trusts	and as	supported	by	the	unit	prices	of	actual	purchase	and	sale	transactions	occurring	as	of	or	close	to	the	financial	statement	date.	The	fair	value	of	these	investments measured	at	net	asset	value	is	excluded	from	the	fair	value	hierarchy.	Investments	in	the	collective	trusts	can	be	redeemed	on	each	business	day	based	upon	the applicable	net	asset	value	per	unit.	Investments	in	the	international	large/mid	cap	equity	collective	trust	can	be	redeemed	on	the	last	business	day	of	each	month	and at	least	one	business	day	during	the	month.

The	mutual	fund	investments	are	not	traded	on	an	exchange,	and	a	majority	of	these	funds	are	held	in	a	separate	account	managed	by	a	fixed	income	manager.	The fair	values	of	these	investments	are	based	on	their	net	asset	values,	as	reported	by	the	managers	and	as	supported	by	the	unit	prices	of	actual	purchase	and	sale transactions	occurring	as	of	or	close	to	the	financial	statement	date.	The	fair	value	of	these	investments	measured	at	net	asset	value	is	excluded	from	the	fair	value hierarchy.	The	objective	of	the	account	is	to	provide	superior	return	with	reasonable	risk,	where	performance	is	expected	to	exceed	Barclays	Long	U.S.	Credit	Index. Investments	in	this	account	can	be	redeemed	with	a	written	notice	to	the	investment	manager.

•Short-term	investments.	Short-term	investments	largely	consist	of	a	money	market	fund,	the	fair	value	of	which	is	based	on	the	net	asset	value	reported	by	the manager	of	the	fund	and	supported	by	the	unit	prices	of	actual	purchase	and	sale	transactions.	The	fair	value	of	these	investments	measured	at	net	asset	value	is excluded	from	the	fair	value	hierarchy.	The	money	market	fund	is	designed	to	provide	safety	of	principal,	daily	liquidity,	and	a	competitive	yield	by	investing	in high	quality	money	market	instruments.	The	investment	objective	of	the	money	market	fund	is	to	provide	the	highest	possible	level	of	current	income	while	still maintaining	liquidity	and	preserving	capital.

•Partnership/corporate feeder interests.	Fair	value	estimates	of	 the	equity	partnership	are	based	 on	 their	 net	 asset	 values,	 as	 reported	 by	 the	 manager	 of	 the partnership.	The	fair	value	of	these	investments	measured	at	net	asset	value	is	excluded	from	the	fair	value	hierarchy.	Investments	in	the	equity	partnership	may	be redeemed	once	per	month	upon	10	days'	prior	written	notice	to	the	General	Partner,	subject	to	the	discretion	of	the	General	Partner.	The	investment	objective	of	the equity	partnership	is	to	seek	capital	appreciation	by	investing	primarily	in	equity	securities.

The	fair	values	of	the	corporate	feeder	are	based	upon	the	net	asset	values	of	the	equity	master	fund	in	which	it	invests.	The	fair	value	of	these	investments	measured at	net	asset	value	is	excluded	from	the	fair	value	hierarchy.	Investments	in	the	corporate	feeder	can	be	redeemed	quarterly	with	at	least	90	days'	notice.	The investment	objective	of	the	corporate	feeder	is	to	generate	long-term	returns	by	investing	in	large,	liquid	equity	securities	with	attractive	fundamentals.

Changes	in	our	Level	3	plan	assets	for	the	year	ended	December	29,	2018	included	(in	millions):

| Asset	Category | December	30,<br>2017 | Additions | Net	Realized<br>Gain/(Loss) | Net	Unrealized<br>Gain/(Loss) | Net	Purchases,<br>Issuances	and<br>Settlements | Transfers	Into/(Out<br>of)	Level	3 | December	29,<br>2018 |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Real\testate | $262 | $— | $49 | $(7) | $(210) | $(15) | $79 |
| Certain\tinsurance\ncontracts | 983 | — | (82) | (3) | (845) | — | 53 |
| Total\tLevel\t3\ninvestments | $1,245 | $— | $(33) | $(10) | $(1,055) | $(15) | $132 |

Net	purchases,	issuances	and	settlements	of	$845	million	principally	related	to	insurance	contract	settlements	in	Canada	in	connection	with	the	wind-up	of	our	Canadian salaried	and	hourly	defined	benefit	pension	plans.

Changes	in	our	Level	3	plan	assets	for	the	year	ended	December	30,	2017	included	(in	millions):

| Asset	Category | December	31,<br>2016 | Additions | Net	Realized<br>Gain/(Loss) | Net	Unrealized<br>Gain/(Loss) | Issuances	and<br>Settlements | Transfers	Into/(Out<br>of)	Level	3 | December	30,<br>2017 |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Real\testate | $234 | $— | $14 | $14 | $— | $— | $262 |
| Certain\tinsurance\ncontracts | 189 | 797 | — | 36 | (39) | — | 983 |
| Total\tLevel\t3\ninvestments | $423 | 797 | $14 | $50 | $(39) | $— | $1,245 |

Additions	of	$797	million	were	principally	related	to	insurance	contracts	entered	into	in	Canada	in	connection	with	the	wind-up	of	our	Canadian	salaried	and	hourly defined	benefit	pension	plans.

# Employer	Contributions:

In	2018,	we	contributed	$57	million	to	our	non-U.S.	pension	plans.	We	did	not	contribute	to	our	U.S.	pension	plans.	We	estimate	that	2019	pension	contributions	will be	approximately	$15	million	to	our	non-U.S.	plans.	We	do	not	plan	to	make	contributions	to	our	U.S.	pension	plans	in	2019.	Our	actual	contributions	and	plans	may change	due	to	many	factors,	including	changes	in	tax,	employee	benefit,	or	other	laws	and	regulations,	tax	deductibility,	significant	differences	between	expected	and actual	pension	asset	performance	or	interest	rates,	or	other	factors.

# Future	Benefit	Payments:

The	estimated	future	benefit	payments	from	our	pension	plans	at	December	29,	2018	were	(in	millions):

|  | U.S.	Plans | Non-U.S.	Plans |
| :--- | :--- | :--- |
| 2019 | $331 | $70 |
| 2020 | 320 | 70 |
| 2021 | 317 | 72 |
| 2022 | 309 | 80 |
| 2023 | 301 | 79 |
| 2024-2028 | 1,351 | 436 |

# Postretirement	Plans

The	accumulated	benefit	obligation,	fair	value	of	plan	assets,	and	funded	status	of	our	postretirement	benefit	plans	were	(in	millions):

|  | December	29,	2018 | December	30,	2017 |
| :--- | :--- | :--- |
| Benefit\tobligation\tat\tbeginning\tof\tyear | $1,553 | $1,714 |
| Service\tcost | 8 | 10 |
| Interest\tcost | 45 | 49 |
| Benefits\tpaid | (136) | (142) |
| Actuarial\tlosses/(gains) | (142) | (70) |
| Plan\tamendments | (21) | (24) |
| Currency | (13) | 13 |
| Other | — | 3 |
| Benefit\tobligation\tat\tend\tof\tyear | 1,294 | 1,553 |
| Fair\tvalue\tof\tplan\tassets\tat\tbeginning\tof\tyear | 1,188 | — |
| Actual\treturn\ton\tplan\tassets | (26) | — |
| Employer\tcontributions | 19 | 1,329 |
| Benefits\tpaid | (137) | (142) |
| Other | — | 1 |
| Fair\tvalue\tof\tplan\tassets\tat\tend\tof\tyear | 1,044 | 1,188 |
| Net\tpostretirement\tbenefit\tliability/(asset)\trecognized\tat\tend\tof\tyear | $250 | $365 |

We	recognized	the	net	postretirement	benefit	asset/(liability)	on	our	consolidated	balance	sheets	as	follows	(in	millions):

|  | December	29,	2018 | December	30,	2017 |
| :--- | :--- | :--- |
| Other\tcurrent\tliabilities | $(14) | $(10) |
| Accrued\tpostemployment\tcosts | (236) | (355) |
| Net\tpostretirement\tbenefit\tasset/(liability)\trecognized | $(250) | $(365) |

For	certain	of	our	postretirement	benefit	plans	that	were	underfunded	based	on	accumulated	postretirement	benefit	obligations	in	excess	of	plan	assets,	the	accumulated benefit	obligations	and	the	fair	value	of	plan	assets	were	(in	millions):

|  | December	29,	2018 | December	30,	2017 |
| :--- | :--- | :--- |
| Discount\trate | 4.2% | 3.5% |
| Health\tcare\tcost\ttrend\trate\tassumed\tfor\tnext\tyear | 6.7% | 6.7% |
| Ultimate\ttrend\trate | 4.9% | 4.9% |

Discount	rates	for	our	plans	were	developed	from	a	model	portfolio	of	high-quality,	fixed-income	debt	instruments	with	durations	that	match	the	expected	future	cash flows	of	the	plans.	Our	expected	health	care	cost	trend	rate	is	based	on	historical	costs	and	our	expectation	for	health	care	cost	trend	rates	going	forward.

The	year	that	the	health	care	cost	trend	rate	reaches	the	ultimate	trend	rate	varies	by	plan	and	ranges	between	2019	and	2030	as	of	December	29,	2018.

Assumed	health	care	costs	trend	rates	have	a	significant	impact	on	the	amounts	reported	for	the	postretirement	benefit	plans.	A	one-percentage-point	change	in	assumed health	care	cost	trend	rates	would	have	the	following	effects,	increase/(decrease)	in	cost	and	obligation,	as	of	December	29,	2018	(in	millions):

Net	postretirement	cost/(benefit)	consisted	of	the	following	(in	millions):

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Service\tcost | $8 | $10 | $12 |
| Interest\tcost | 45 | 49 | 52 |
| Expected\treturn\ton\tplan\tassets | (50) | — | — |
| Amortization\tof\tprior\tservice\tcosts/(credits) | (311) | (328) | (355) |
| Amortization\tof\tunrecognized\tlosses/(gains) | — | — | (1) |
| Curtailments | — | (177) | — |
| Net\tpostretirement\tcost/(benefit) | $(308) | $(446) | $(292) |

The	amortization	of	prior	service	credits	was	primarily	driven	by	plan	amendments	in	2015	and	2016.	We	estimate	that	amortization	of	prior	service	credits	will	be approximately	$306	million	in	2019,	$122	million	in	2020,	$8	million	in	2021,	$6	million	in	2022,	and	$6	million	in	2023.

In	 2017,	 we	 remeasured	 certain	 of	 our	 postretirement	 plans	 and	 recognized	 a	 curtailment	 gain	 of	$177	million.	The	 curtailment	 was	 triggered	 by	 the	 number	 of cumulative	headcount	reductions	after	the	closure	of	certain	U.S.	factories	during	the	year.	The	resulting	gain	is	attributed	to	accelerating	a	portion	of	the	previously deferred	actuarial	gains	and	prior	service	credits.	The	headcount	reductions	and	factory	closures	were	part	of	our	Integration	Program.	See	Note	6,	Integration	and Restructuring	Expenses,	for	additional	information.

We	used	the	following	weighted	average	assumptions	to	determine	our	net	postretirement	benefit	plans	cost:

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Discount\trate\t-\tService\tcost | 3.6% | 4.0% | 4.3% |
| Discount\trate\t-\tInterest\tcost | 3.0% | 3.0% | 3.0% |
| Expected\trate\tof\treturn\ton\tplan\tassets | 4.4% | —% | —% |
| Health\tcare\tcost\ttrend\trate | 6.7% | 6.3% | 6.5% |

Discount	rates	for	our	plans	were	developed	from	a	model	portfolio	of	high-quality,	fixed-income	debt	instruments	with	durations	that	match	the	expected	future	cash flows	of	the	plans.	We	determine	our	expected	rate	of	return	on	plan	assets	from	the	plan	assets'	target	asset	allocation	and	estimates	of	future	long-term	returns	by	asset class.	Our	expected	health	care	cost	trend	rate	is	based	on	historical	costs	and	our	expectation	for	health	care	cost	trend	rates	going	forward.

In	December	2017,	we	made	a	cash	contribution	of	approximately	$1.2	billion	to	pre-fund	a	portion	of	our	U.S.	postretirement	plan	benefits	following	enactment	of	U.S. Tax	Reform	on	December	22,	2017.	The	underlying	basis	of	the	investment	strategy	of	our	U.S.	postretirement	plans	is	to	ensure	that	funds	are	available	to	meet	the plans'	benefit	obligations	when	they	are	due	by	investing	plan	assets	in	a	high-quality,	diversified	manner	in	order	to	maintain	the	security	of	the	funds.	The	investment strategy	expects	equity	investments	to	yield	a	higher	return	over	the	long	term	than	fixed-income	securities,	while	fixed-income	securities	are	expected	to	provide	certain matching	characteristics	to	the	plans'	benefit	payment	cash	flow	requirements.

| Our	weighted	average	asset	allocations	were: |  |  |
| :--- | :--- | :--- |
|  | December\t29,\t2018 | December\t30,\t2017 |
| Fixed-income\tsecurities | 65% | —% |
| Equity\tsecurities | 27% | —% |
| Cash\tand\tcash\tequivalents | 8% | 100% |

Our	postretirement	benefit	plan	investment	strategy	is	subject	to	local	regulations	and	the	asset/liability	profiles	of	the	plans	in	each	individual	country.	Our	investment strategy	is	designed	to	align	our	postretirement	benefit	plan	assets	with	our	postretirement	benefit	obligation	to	reduce	volatility.	In	aggregate,	our	long-term	asset allocation	targets	are	broadly	characterized	as	a	mix	of	approximately	70%	in	fixed-income	securities	and	approximately	30%	in	return-seeking	assets,	primarily	equity securities.

The	fair	value	of	postretirement	benefit	plan	assets	at	December	29,	2018	was	determined	using	the	following	fair	value	measurements	(in	millions):

| Asset	Category | Total	Fair	Value | Quoted	Prices	in	Active<br>Markets	for	Identical<br>Assets<br>(Level	1) | Significant	Other<br>Observable	Inputs<br>(Level	2) | Significant	Unobservable<br>Inputs<br>(Level	3) |
| :--- | :--- | :--- | :--- | :--- |
| Government\tbonds | $26 | $26 | $— | $— |
| Corporate\tbonds\tand\tother\tfixed-income\tsecurities | 567 | — | 567 | — |
| Total\tfixed-income\tsecurities | 593 | 26 | 567 | — |
| Equity\tsecurities | 146 | 146 | — | — |
| Fair\tvalue\texcluding\tinvestments\tmeasured\tat\tnet\tasset\tvalue | 739 | 172 | 567 | — |

The	fair	value	of	our	postretirement	benefit	plan	assets	was	$1.2	billion	at	December	30,	2017.	These	assets	were	all	classified	as	Level	1	short-term	investments.

The	following	section	describes	the	valuation	methodologies	used	to	measure	the	fair	value	of	postretirement	benefit	plan	assets,	including	an	indication	of	the	level	in the	fair	value	hierarchy	in	which	each	type	of	asset	is	generally	classified.

Corporate	Bonds	and	Other	Fixed-Income	Securities.	These	securities	consist	of	publicly	traded	U.S.	and	non-U.S.	fixed	interest	obligations	(principally	corporate bonds	an	tax-exempt	municipal	bonds).	Such	investments	are	valued	through	consultation	and	evaluation	with	brokers	in	the	institutional	market	using	quoted	prices	and other	observable	market	data.	As	such,	these	securities	are	included	in	Level	2.

Investments	Measured	at	Net	Asset	Value.	This	category	consists	of	pooled	funds	and	short-term	investments.

The	mutual	fund	investments	are	not	traded	on	an	exchange.	The	fair	values	of	the	mutual	fund	investments	that	are	not	traded	on	an	exchange	are	based	on	their	net asset	values,	as	reported	by	the	managers	and	as	supported	by	the	unit	prices	of	actual	purchase	and	sale	transactions	occurring	as	of	or	close	to	the	financial statement	date.	The	fair	value	of	these	investments	measured	at	net	asset	value	is	excluded	from	the	fair	value	hierarchy.

In	2018,	we	contributed	$19	million	to	our	postretirement	benefit	plans.	We	estimate	that	2019	postretirement	benefit	plan	contributions	will	be	approximately	$15 million.	Our	actual	contributions	and	plans	may	change	due	to	many	factors,	including	changes	in	tax,	employee	benefit,	or	other	laws	and	regulations,	tax	deductibility, significant	differences	between	expected	and	actual	postretirement	plan	asset	performance	or	interest	rates,	or	other	factors.

Our	estimated	future	benefit	payments	for	our	postretirement	plans	at	December	29,	2018	were	(in	millions):

# Other	Plans

We	sponsor	and	contribute	to	employee	savings	plans	that	cover	eligible	salaried,	non-union,	and	union	employees.	Our	contributions	and	costs	are	determined	by	the matching	of	employee	contributions,	as	defined	by	the	plans.	Amounts	charged	to	expense	for	defined	contribution	plans	totaled	$85	million	in	2018,	$78	million	in 2017,	and	$74	million	in	2016.

# Accumulated	Other	Comprehensive	Income/(Losses)

Our	accumulated	other	comprehensive	income/(losses)	pension	and	postretirement	benefit	plans	balances,	before	tax,	consisted	of	the	following	(in	millions):

|  | Pension	Benefits | Pension	Benefits | Postretirement	Benefits | Postretirement	Benefits |  | Total |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\t2018 | December\t30,\t2017 | December\t29,\t2018 | December\t30,\t2017 | December\t29,\t2018 | December\t30,\t2017 |
| Net\tactuarial\tgain/(loss) | $175 | $13 | $177 | $111 | $352 | $124 |
| Prior\tservice\tcredit/(cost) | (14) | 1 | 458 | 748 | 444 | 749 |
|  | $161 | $14 | $635 | $859 | $796 | $873 |

The	net	postemployment	benefits	recognized	in	other	comprehensive	income/(loss),	consisted	of	the	following	(in	millions):

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Net\tpostemployment\tbenefit\tgains/(losses)\tarising\tduring\tthe\tperiod: |  |  |  |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod\t-\tPension\tBenefits | $8 | $45 | $(73) |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod\t-\tPostretirement\tBenefits | 66 | 71 | (5) |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod\t-\tPension\tBenefits | (15) | 1 | — |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod\t-\tPostretirement\tBenefits | 21 | 24 | 51 |
|  | 80 | 141 | (27) |
| Tax\tbenefit/(expense) | (19) | (55) | 18 |
|  | $61 | $86 | $(9) |
| Reclassification\tof\tnet\tpostemployment\tbenefit\tlosses/(gains)\tto\tnet\tincome/(loss): |  |  |  |
| Amortization\tof\tunrecognized\tlosses/(gains)\t-\tPension\tBenefits | $2 | $1 | $— |
| Amortization\tof\tunrecognized\tlosses/(gains)\t-\tPostretirement\tBenefits | — | — | (1) |
| Amortization\tof\tprior\tservice\tcosts/(credits)\t-\tPostretirement\tBenefits | (311) | (328) | (355) |
| Net\tsettlement\tand\tcurtailment\tlosses/(gains)\t-\tPension\tBenefits | 153 | 2 | 25 |
| Net\tsettlement\tand\tcurtailment\tlosses/(gains)\t-\tPostretirement\tBenefits | — | (177) | — |
|  | (156) | (502) | (331) |
| Tax\tbenefit/(expense) | 38 | 193 | 127 |
|  | $(118) | $(309) | $(204) |

As	 of	December	 29,	 2018,	 we	 expect	 to	 amortize	$306	 million	 of	 postretirement	 benefit	 plans	 prior	 service	 credits	 from	 accumulated	 other	 comprehensive income/(losses)	 into	 net	 postretirement	 benefit	 plans	 costs/(benefits)	 during	 2019.	 We	 do	 not	 expect	 to	 amortize	 any	 other	 significant	 postemployment	 benefit losses/(gains)	into	net	pension	or	net	postretirement	benefit	plan	costs/(benefits)	during	2019.

# Note	14.	Financial	Instruments

All	 of	 our	 non-exchange	 traded	 derivative	 contracts	 are	 governed	 by	 an	 International	 Swaps	 and	 Derivatives	Association	 master	 agreement,	 and these	 master agreements	and	their	schedules	contain	certain	obligations	regarding	the	delivery	of	certain	financial	information	upon	demand.

# Derivative	Volume:

The	notional	values	of	our	outstanding	derivative	instruments	were	(in	millions):

|  | December	29,	2018 | December	30,	2017 |
| :--- | :--- | :--- |
| Commodity\tcontracts | $478 | $272 |
| Foreign\texchange\tcontracts | 3,263 | 2,876 |
| Cross-currency\tcontracts | 10,146 | 3,161 |

The	increase	in	our	derivative	volume	for	cross-currency	contracts	was	primarily	driven	by	the	addition	of	new	Canadian	dollar	and	British	pound	sterling	cross-currency swaps.	A	portion	of	these	new	contracts	is	being	used	to	offset	existing	cross-currency	contracts	that	are	no	longer	designated	as	hedging	instruments.	The	remaining portion	of	the	new	contracts	is	designated	as	net	investment	hedges.

# Fair	Value	of	Derivative	Instruments:

Fair	value	is	defined	as	the	price	that	would	be	received	to	sell	an	asset	or	paid	to	transfer	a	liability	in	an	orderly	transaction	between	market	participants	at	the measurement	date.	The	fair	values	and	the	levels	within	the	fair	value	hierarchy	of	derivative	instruments	recorded	on	the	consolidated	balance	sheets	were	(in	millions):

|  | Quoted	Prices	in	Active	Markets	for | Quoted	Prices	in	Active	Markets	for | Significant	Other	Observable | Significant	Other	Observable |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Identical\tAssets\tand\tLiabilities | Identical\tAssets\tand\tLiabilities | Inputs |  |  |  |
|  | (Level\t1)\nAssets | Liabilities | (Level\t2)\nAssets | Liabilities | Total\tFair\tValue\nAssets | Liabilities |
| Derivatives\tdesignated\tas\thedging\tinstruments: |  |  |  |  |  |  |
| Foreign\texchange\tcontracts(a) | $— | $— | $51 | $26 | $51 | $26 |
| Cross-currency\tcontracts(b) | — | — | 139 | 3 | 139 | 3 |
| Derivatives\tnot\tdesignated\tas\thedging\tinstruments: |  |  |  |  |  |  |
| Commodity\tcontracts(c) | 5 | 27 | — | 2 | 5 | 29 |
| Foreign\texchange\tcontracts(c) | — | — | 5 | 42 | 5 | 42 |
| Cross-currency\tcontracts(b) | — | — | 557 | 119 | 557 | 119 |
| Total\tfair\tvalue | $5 | $27 | $752 | $192 | $757 | $219 |

(a) The	fair	value	of	derivative	assets	was	recorded	in	other	current	assets	and	the	fair	value	of	derivative	liabilities	was	recorded	in	other	current	liabilities.

(b) The	fair	value	of	derivative	assets	was	recorded	in	other	current	assets	( $557	million)	and	other	non-current	assets	( $139	million),	and	the	fair	value	of	derivative	liabilities	was	recorded	within other	current	liabilities	($119	million)	and	other	non-current	liabilities	( $3	million).

(c) The	fair	value	of	derivative	assets	was	recorded	in	other	current	assets	and	the	fair	value	of	derivative	liabilities	was	recorded	in	other	current	liabilities.

|  |  |  | December	30,	2017 |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Quoted\tPrices\tin\tActive\tMarkets\tfor | Quoted\tPrices\tin\tActive\tMarkets\tfor | Significant\tOther\tObservable | Significant\tOther\tObservable |  |  |
|  | Identical\tAssets\tand\tLiabilities | Identical\tAssets\tand\tLiabilities | Inputs |  |  |  |
|  | (Level\t1)\nAssets | Liabilities | (Level\t2)\nAssets | Liabilities | Total\tFair\tValue\nAssets | Liabilities |
| Derivatives\tdesignated\tas\thedging\tinstruments: |  |  |  |  |  |  |
| Foreign\texchange\tcontracts(a) | $— | $— | $8 | $42 | $8 | $42 |
| Cross-currency\tcontracts(b) | — | — | 344 | — | 344 | — |
| Derivatives\tnot\tdesignated\tas\thedging\tinstruments: |  |  |  |  |  |  |
| Commodity\tcontracts(c) | 4 | 8 | — | — | 4 | 8 |
| Foreign\texchange\tcontracts(c) | — | — | 17 | 3 | 17 | 3 |
| Cross-currency\tcontracts(b) | — | — | 19 | — | 19 | — |
| Total\tfair\tvalue | $4 | $8 | $388 | $45 | $392 | $53 |

(a) The	fair	value	of	derivative	assets	was	recorded	in	other	current	assets	and	the	fair	value	of	derivative	liabilities	was	recorded	in	other	current	liabilities	( $41	million)	and	other	non-current liabilities	($1	million).

(b) The	fair	value	of	our	derivative	assets	was	recorded	in	other	non-current	assets.

Our	derivative	financial	instruments	are	subject	to	master	netting	arrangements	that	allow	for	the	offset	of	assets	and	liabilities	in	the	event	of	default	or	early	termination of	the	contract.	We	elect	to	record	the	gross	assets	and	liabilities	of	our	derivative	financial	instruments	on	the	consolidated	balance	sheets.	If	the	derivative	financial instruments	had	been	netted	on	the	consolidated	balance	sheets,	the	asset	and	liability	positions	each	would	have	been	reduced	by	$124	million	at	December	29,	2018	and $23	million	at	December	30,	2017.	At	December	29,	2018,	collateral	of	$32	million	was	posted	related	to	commodity	derivative	margin	requirements.	This	was	included in	other	current	assets	on	our	consolidated	balance	sheet	at	December	29,	2018.

Level	1	financial	assets	and	liabilities	consist	of	commodity	future	and	options	contracts	and	are	valued	using	quoted	prices	in	active	markets	for	identical	assets	and liabilities.

Level	2	financial	assets	and	liabilities	consist	of	commodity	swaps,	foreign	exchange	forwards,	options,	and	swaps,	and	cross-currency	swaps.	Commodity	swaps	are valued	using	an	income	approach	based	on	the	observable	market	commodity	index	prices	less	the	contract	rate	multiplied	by	the	notional	amount.	Foreign	exchange forwards	and	swaps	are	valued	using	an	income	approach	based	on	observable	market	forward	rates	less	the	contract	rate	multiplied	by	the	notional	amount.	Foreign exchange	options	are	valued	using	an	income	approach	based	on	a	Black-Scholes-Merton	formula.	This	formula	uses	present	value	techniques	and	reflects	the	time	value and	intrinsic	value	based	on	observable	market	rates.	Cross-currency	swaps	are	valued	based	on	observable	market	spot	and	swap	rates.

We	did	not	have	any	Level	3	financial	assets	or	liabilities	in	any	period	presented.

Our	calculation	of	the	fair	value	of	financial	instruments	takes	into	consideration	the	risk	of	nonperformance,	including	counterparty	credit	risk.

# Net	Investment	Hedging:

At	December	29,	2018,	we	had	the	following	items	designated	as	net	investment	hedges:

•Non-derivative foreign denominated debt	 with principal amounts of	€2,550	 million and	£400 million;

•Cross-currency	contracts	with	notional	amounts	of	£1.0	billion	($1.4	billion),	C$2.1	billion	($1.6	billion),	and	¥9.6	billion	($85	million);	and •Foreign	exchange	contracts,	including	contracts	denominated	in:

◦Chinese renminbi with an aggregate notional amount of	$127 million,

◦Euros	 with	 an	 aggregate	 notional	 amount	 of	$264	 million, and

◦Indian rupees with an aggregate notional amount of	$279 million.

The	component	of	the	gains	and	losses	on	our	net	investment	in	these	designated	foreign	operations,	driven	by	changes	in	foreign	exchange	rates,	are	economically	offset by	fair	value	movements	on	the	effective	portion	of	our	cross-currency	contracts	and	foreign	exchange	contracts	and	remeasurements	of	our	foreign	denominated	debt.

# Interest	Rate	Hedging:

From	time	to	time	we	have	had	derivatives	designated	as	interest	rate	hedges,	including	interest	rate	swaps.	We	no	longer	have	any	outstanding	interest	rate	swaps.	We continue	to	amortize	the	realized	hedge	losses	that	were	deferred	into	accumulated	other	comprehensive	income/(losses)	into	interest	expense	through	the	original maturity	of	the	related	long-term	debt	instruments.

# Cash	Flow	Hedge	Coverage:

At	December	29,	2018,	we	had	entered	into	foreign	exchange	contracts	designated	as	cash	flow	hedges	for	periods	not	exceeding	the	next	12	months	and	into	cross- currency	contracts	designated	as	cash	flow	hedges	for	periods	not	exceeding	the	next	five	years.

# Deferred	Hedging	Gains	and	Losses	on	Cash	Flow	Hedges:

Based	on	our	valuation	at	December	29,	2018	and	assuming	market	rates	remain	constant	through	contract	maturities,	we	expect	transfers	to	net	income/(loss)	of unrealized	gains	for	foreign	currency	cash	flow	hedges	during	the	next	12	months	to	be	approximately	$32	million.	Additionally,	we	expect	transfers	to	net	income/(loss) of	unrealized	losses	for	interest	rate	cash	flow	hedges	and	cross-currency	cash	flow	hedges	during	the	next	12	months	to	be	insignificant.

# Concentration	of	Credit	Risk:

Counterparties	to	our	foreign	exchange	derivatives	consist	of	major	international	financial	institutions.	We	continually	monitor	our	positions	and	the	credit	ratings	of	the counterparties	involved	and,	by	policy,	limit	the	amount	of	our	credit	exposure	to	any	one	party.	While	we	may	be	exposed	to	potential	losses	due	to	the	credit	risk	of non-performance	by	these	counterparties,	losses	are	not	anticipated.	We	closely	monitor	the	credit	risk	associated	with	our	counterparties	and	customers	and	to	date	have not	experienced	material	losses.

# Economic	Hedging:

We	enter	into	certain	derivative	contracts	not	designated	as	hedging	instruments	in	accordance	with	our	risk	management	strategy	which	have	an	economic	impact	of largely	mitigating	commodity	price	risk	and	foreign	currency	exposures.	Gains	and	losses	are	recorded	in	net	income/(loss)	as	a	component	of	cost	of	products	sold	for our	commodity	contracts	and	other	expense/(income),	net	for	our	cross	currency	and	foreign	exchange	contracts.

# Divestiture	Hedging:

We	entered	into	foreign	exchange	derivative	contracts	to	economically	hedge	the	foreign	currency	exposure	related	to	the	Heinz	India	Transaction.	The	related	derivative losses	 were	$20	million,	 including	$17	million	 recorded	 within	 other	 expense/(income),	 net,	 and	$3	million	 recorded	 within	 interest	 expense	 for	 the	 year	 ended December	29,	2018.	These	losses	are	classified	as	other	losses/(gains)	related	to	acquisitions	and	divestitures.	Additionally,	we	entered	into	foreign	exchange	contracts, which	are	designated	as	net	investment	hedges	related	to	our	investment	in	Heinz	India.	Related	to	these	net	investment	hedges,	we	had	unrealized	hedge	losses	of	$10 million,	which	were	recognized	in	accumulated	other	comprehensive	income/(losses).	See	Note	5,	Acquisitions	and	Divestitures,	for	additional	information	related	to	the Heinz	India	Transaction.

# Derivative	Impact	on	the	Statements	of	Comprehensive	Income:

The	following	table	presents	the	pre-tax	amounts	of	derivative	gains/(losses)	deferred	into	accumulated	other	comprehensive	income/(losses)	and	the	income	statement line	item	that	will	be	affected	when	reclassified	to	net	income/(loss)	(in	millions):

|  | Gains/(Losses)	Recognized	in	Other	Comprehensive | Gains/(Losses)	Recognized	in	Other	Comprehensive |  |  |
| :--- | :--- | :--- | :--- | :--- |
|  | Income/(Losses)\tRelated\tto\tDerivatives\tDesignated\tas\tHedging | Income/(Losses)\tRelated\tto\tDerivatives\tDesignated\tas\tHedging | Income/(Losses)\tRelated\tto\tDerivatives\tDesignated\tas\tHedging | Location\tof\tGains/(Losses)\tWhen |
| Accumulated\tOther\tComprehensive\tIncome/(Losses)\tComponent | December\t29,\n2018 | Instruments\nDecember\t30,\n2017 | December\t31,\n2016 | Reclassified\tto\tNet\tIncome/(Loss) |
| Cash\tflow\thedges: |  |  |  |  |
| Foreign\texchange\tcontracts | $— | $1 | $3 | \t Net\tsales |
| Foreign\texchange\tcontracts | 64 | (42) | 6 | \t Cost\tof\tproducts\tsold |
| Foreign\texchange\tcontracts\t(excluded\tcomponent) | (2) | — | — | \t Cost\tof\tproducts\tsold |
| Foreign\texchange\tcontracts | 56 | (82) | 39 | \t Other\texpense/(income),\tnet |
| Foreign\texchange\tcontracts\t(excluded\tcomponent) | 3 | — | — | \t Other\texpense/(income),\tnet |
| Interest\trate\tcontracts | — | — | (8) | Interest\texpense |
| Cross-currency\tcontracts | (4) | — | — | \t Other\texpense/(income),\tnet |
| Cross-currency\tcontracts\t(excluded\tcomponent) | 1 | — | — | \t Other\texpense/(income),\tnet |
| Net\tinvestment\thedges: |  |  |  |  |
| Foreign\texchange\tcontracts | (11) | (23) | 45 | SG&amp;A |
| Foreign\texchange\tcontracts\t(excluded\tcomponent) | (3) | — | — | Interest\texpense |
| Cross-currency\tcontracts | 214 | (184) | 147 | SG&amp;A |
| Cross-currency\tcontracts\t(excluded\tcomponent) | 13 | — | — | Interest\texpense |
| Total\tgains/(losses)\trecognized\tin\tstatements\tof\tcomprehensive\nincome | $331 | $(330) | $232 |  |

# Derivative	Impact	on	the	Statements	of	Income:

The	following	tables	present	the	pre-tax	amounts	of	derivative	gains/(losses)	reclassified	from	accumulated	other	comprehensive	income/(losses)	to	net	income/(loss)	and the	affected	income	statement	line	items	(in	millions):

|  | Cost	of	products<br>sold | Interest	expense | Other	expense/<br>(income),	net |
| :--- | :--- | :--- | :--- |
| Total\tamounts\tpresented\tin\tthe\tconsolidated\tstatements\tof\tincome\tin\twhich\tthe\tfollowing\teffects\twere\nrecorded | $17,347 | $1,284 | $(183) |
| Gains/(losses)\trelated\tto\tderivatives\tdesignated\tas\thedging\tinstruments: |  |  |  |
| Cash\tflow\thedges: |  |  |  |
| Foreign\texchange\tcontracts | $(2) | $— | $56 |
| Foreign\texchange\tcontracts\t(excluded\tcomponent) | (2) | — | 3 |
| Interest\trate\tcontracts | — | (4) | — |
| Cross-currency\tcontracts | — | — | (7) |
| Cross-currency\tcontracts\t(excluded\tcomponent) | — | — | 1 |
| Net\tinvestment\thedges: |  |  |  |
| Foreign\texchange\tcontracts\t(excluded\tcomponent) | — | (3) | — |
| Cross-currency\tcontracts\t(excluded\tcomponent) | — | 13 | — |
| Gains/(losses)\trelated\tto\tderivatives\tnot\tdesignated\tas\thedging\tinstruments: |  |  |  |
| Commodity\tcontracts | (44) | — | — |
| Foreign\texchange\tcontracts | — | — | (84) |
| Cross-currency\tcontracts | — | — | 4 |
| Total\tgains/(losses)\trecognized\tin\tstatements\tof\tincome | $(48) | $6 | $(27) |

|  | Cost	of<br>products	sold | Interest<br>expense | Other	expense/<br>(income),	net | Net	sales | Cost	of<br>products	sold | Interest<br>expense | expense/<br>(income),	net |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Total\tamounts\tpresented\tin\tthe\tconsolidated\tstatements\tof |  |  |  |  |  |  |  |
| income\tin\twhich\tthe\tfollowing\teffects\twere\trecorded\t(As |  |  |  |  |  |  |  |
| Restated\t&amp;\tRecast) | $17,043 | $1,234 | $(627) | $26,300 | $17,154 | $1,134 | $(472) |
| Gains/(losses)\trelated\tto\tderivatives\tdesignated\tas\thedging\ninstruments: |  |  |  |  |  |  |  |
| Cash\tflow\thedges: |  |  |  |  |  |  |  |
| Foreign\texchange\tcontracts | $— | $— | $(81) | $6 | $41 | $— | $38 |
| Interest\trate\tcontracts | — | (4) | — | — | — | (4) | — |
| Gains/(losses)\trelated\tto\tderivatives\tnot\tdesignated\tas\nhedging\tinstruments: |  |  |  |  |  |  |  |
| Commodity\tcontracts | (37) | — | — | — | 9 | — | — |
| Foreign\texchange\tcontracts | — | — | 54 | — | — | — | (63) |
| Cross-currency\tcontracts | — | — | (2) | — | — | — | (3) |
| Total\tgains/(losses)\trecognized\tin\tstatements\tof\tincome | $(37) | $(4) | $(29) | $6 | $50 | $(4) | $(28) |

# Non-Derivative	Impact	on	Statements	of	Comprehensive	Income:

Related	to	our	non-derivative,	foreign	denominated	debt	instruments	designated	as	net	investment	hedges,	we	recognized	pre-tax	gains	of	$174	million	in	2018,	pre-tax losses	of	$425	million	in	2017,	and	pre-tax	gains	of	$234	million	in	2016.	These	amounts	were	recognized	in	other	comprehensive	income/(loss).

# Note	15.	Accumulated	Other	Comprehensive	Income/(Losses)

Certain	prior	period	balances	herein	reflect	the	restatements	described	in	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements.

The	components	of,	and	changes	in,	accumulated	other	comprehensive	income/(losses),	net	of	tax,	were	as	follows	(in	millions):

|  | Foreign	Currency<br>Translation<br>Adjustments | Net	Postemployment<br>Benefit	Plan<br>Adjustments | Net	Cash	Flow	Hedge<br>Adjustments | Total |
| :--- | :--- | :--- | :--- | :--- |
| Balance\tas\tof\tJanuary\t3,\t2016\t(As\tRestated) | $(1,654) | $985 | $53 | $(616) |
| Foreign\tcurrency\ttranslation\tadjustments | (985) | — | — | (985) |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | 226 | — | — | 226 |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | — | — | 46 | 46 |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\nincome/(loss) | — | — | (87) | (87) |
| Net\tpostemployment\tbenefit\tgains/(losses)\tarising\tduring\tthe\tperiod | — | (9) | — | (9) |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | — | (204) | — | (204) |
| Total\tother\tcomprehensive\tincome/(loss) | (759) | (213) | (41) | (1,013) |
| Balance\tas\tof\tDecember\t31,\t2016\t(As\tRestated) | (2,413) | 772 | 12 | (1,629) |
| Foreign\tcurrency\ttranslation\tadjustments | 1,179 | — | — | 1,179 |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | (353) | — | — | (353) |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | — | — | (113) | (113) |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\nincome/(loss) | — | — | 85 | 85 |
| Net\tpostemployment\tbenefit\tgains/(losses)\tarising\tduring\tthe\tperiod | — | 86 | — | 86 |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | — | (309) | — | (309) |
| Total\tother\tcomprehensive\tincome/(loss) | 826 | (223) | (28) | 575 |
| Balance\tas\tof\tDecember\t30,\t2017\t(As\tRestated) | (1,587) | 549 | (16) | (1,054) |
| Foreign\tcurrency\ttranslation\tadjustments | (1,173) | — | — | (1,173) |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | 284 | — | — | 284 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\nhedges | 7 | — | — | 7 |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\nincome/(loss) | (7) | — | — | (7) |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | — | — | 99 | 99 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — | 2 | 2 |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\nincome/(loss) | — | — | (44) | (44) |
| Net\tpostemployment\tbenefit\tgains/(losses)\tarising\tduring\tthe\tperiod | — | 61 | — | 61 |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | — | (118) | — | (118) |
| Total\tother\tcomprehensive\tincome/(loss) | (889) | (57) | 57 | (889) |
| Balance\tas\tof\tDecember\t29,\t2018 | $(2,476) | $492 | $41 | $(1,943) |

Reclassification	of	net	postemployment	benefit	losses/(gains)	included	amounts	reclassified	to	net	income	and	amounts	reclassified	into	inventory	(consistent	with	our capitalization	policy).

The	gross	amount	and	related tax	benefit/(expense)	recorded in,	and	associated	with,	each	component	of	other	comprehensive income/(loss)	were	as	follows	(in millions):

|  |  | December	29,<br>2018 |  |  | December	30,<br>2017 |  |  | December	31,<br>2016 |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Before\tTax\nAmount | Tax | Net\tof\tTax\nAmount | Before\tTax\nAmount | Tax | Net\tof\tTax\nAmount | Before\tTax\nAmount | Tax | Net\tof\tTax\nAmount |
| Foreign\tcurrency\ttranslation\tadjustments | $(1,173) | $— | $(1,173) | $1,179 | $— | $1,179 | $(985) | $— | $(985) |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\nhedges | 377 | (93) | 284 | (632) | 279 | (353) | 426 | (200) | 226 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\nassessment\tof\tnet\tinvestment\thedges | 10 | (3) | 7 | — | — | — | — | — | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\nhedges\treclassified\tto\tnet\tincome/(loss) | (10) | 3 | (7) | — | — | — | — | — | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | 116 | (17) | 99 | (123) | 10 | (113) | 40 | 6 | 46 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\nassessment\tof\tcash\tflow\thedges | 2 | — | 2 | — | — | — | — | — | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\nreclassified\tto\tnet\tincome/(loss) | (45) | 1 | (44) | 85 | — | 85 | (81) | (6) | (87) |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\nperiod | 74 | (16) | 58 | 116 | (47) | 69 | (78) | 38 | (40) |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\nperiod | 6 | (3) | 3 | 25 | (8) | 17 | 51 | (20) | 31 |
| Net\tpostemployment\tbenefit\tlosses/(gains)\nreclassified\tto\tnet\tincome/(loss) | (156) | 38 | (118) | (502) | 193 | (309) | (331) | 127 | (204) |

The	amounts	reclassified	from	accumulated	other	comprehensive	income/(losses)	were	as	follows	(in	millions):

| Accumulated	Other	Comprehensive	Income/(Losses)	Component | Reclassified	from	Accumulated	Other	Comprehensive<br>Income/(Losses)	to	Net	Income/(Loss) | Reclassified	from	Accumulated	Other	Comprehensive<br>Income/(Losses)	to	Net	Income/(Loss) |  | Affected	Line	Item	in	the	Statements	of<br>Income |
| :--- | :--- | :--- | :--- | :--- |
|  | December\t29,\n2018 | December\t30,\n2017 | As\tRestated\nDecember\t31,\n2016 |  |
| Losses/(gains)\ton\tnet\tinvestment\thedges: |  |  |  |  |
| Foreign\texchange\tcontracts(a) | $3 | $— | $— | Interest\texpense |
| Cross-currency\tcontracts(a) | (13) | — | — | Interest\texpense |
| Losses/(gains)\ton\tcash\tflow\thedges: |  |  |  |  |
| Foreign\texchange\tcontracts(b) | — | — | (6) | \t Net\tsales |
| Foreign\texchange\tcontracts(b) | 4 | — | (41) | \t Cost\tof\tproducts\tsold |
| Foreign\texchange\tcontracts(b) | (59) | 81 | (38) | \t Other\texpense/(income),\tnet |
| Cross-currency\tcontracts(a) | 6 | — | — | \t Other\texpense/(income),\tnet |
| Interest\trate\tcontracts(c) | 4 | 4 | 4 | Interest\texpense |
| Losses/(gains)\ton\thedges\tbefore\tincome\ttaxes | (55) | 85 | (81) |  |
| Losses/(gains)\ton\thedges,\tincome\ttaxes | 4 | — | (6) |  |
| Losses/(gains)\ton\thedges | $(51) | $85 | $(87) |  |
| Losses/(gains)\ton\tpostemployment\tbenefits: |  |  |  |  |
| Amortization\tof\tunrecognized\tlosses/(gains) | $2 | $1 | $(1) | (d) |
| Amortization\tof\tprior\tservice\tcosts/(credits) | (311) | (328) | (355) | (d) |
| Settlement\tand\tcurtailment\tlosses/(gains) | 153 | (175) | 25 | (d) |
| Losses/(gains)\ton\tpostemployment\tbenefits\tbefore\tincome\ttaxes | (156) | (502) | (331) |  |
| Losses/(gains)\ton\tpostemployment\tbenefits,\tincome\ttaxes | 38 | 193 | 127 |  |
| Losses/(gains)\ton\tpostemployment\tbenefits | $(118) | $(309) | $(204) |  |

(a) Represents	recognition	of	the	excluded	component	in	net	income/(loss).

(b) Includes	amortization	of	the	excluded	component	and	the	effective	portion	of	the	related	hedges.

(c) Represents	amortization	of	realized	hedge	losses	that	were	deferred	into	accumulated	other	comprehensive	income/(losses)	through	the	maturity	of	the	related	long-term	debt	instruments.

(d) These	components	are	included	in	the	computation	of	net	periodic	postemployment	benefit	costs.	See	Note	13,	 Postemployment	Benefits,	for	additional	information.

In	this	note	we	have	excluded	activity	and	balances	related	to	noncontrolling	interest	due	to	its	insignificance.	This	activity	was	primarily	related	to	foreign	currency translation	adjustments.

# Note	16.	Venezuela	-	Foreign	Currency	and	Inflation

We	have	a	subsidiary	in	Venezuela	that	manufactures	and	sells	a	variety	of	products,	primarily	in	the	condiments	and	sauces	and	infant	and	nutrition	categories.	We apply	highly	 inflationary	accounting	 to	 the	results	of	our	Venezuelan	subsidiary	and	 include	 these	results	 in	our	consolidated	financial	statements.	Under	highly inflationary	accounting,	the	functional	currency	of	our	Venezuelan	subsidiary	is	the	U.S.	dollar	(the	reporting	currency	of	Kraft	Heinz),	although	the	majority	of	its transactions	are	in	Venezuelan	bolivars.	As	a	result,	we	must	revalue	the	results	of	our	Venezuelan	subsidiary	to	U.S.	dollars.	We	revalue	the	income	statement	using daily	weighted	average	DICOM	(as	defined	below)	rates,	and	we	revalue	the	bolivar	denominated	monetary	assets	and	liabilities	at	the	period-end	DICOM	spot	rate.	The resulting	revaluation	gains	and	losses	are	recorded	in	current	net	income/(loss),	rather	than	accumulated	other	comprehensive	income/(losses).	These	gains	and	losses	are classified	within	other	expense/(income),	net	as	nonmonetary	currency	devaluation	on	our	consolidated	statements	of	income.

In	February	2018,	the	Venezuelan	government	eliminated	the	official	exchange	rate,	which	was	available	through	the	Sistema	de	Divisa	Protegida	("DIPRO")	for purchases	and	sales	of	certain	essential	items,	including	food	products.	At	December	30,	2017,	we	had	outstanding	invoice	reimbursement	requests	of	$26	million	related to	the	purchase	of	ingredients	and	packaging	materials	for	the	years	2012	through	2015.	Following	the	elimination	of	this	preferential	rate,	we	determined	that	these outstanding	requests,	which	were	approved	by	the	Venezuelan	government,	were	no	longer	collectible.	There	was	no	impact	on	our	consolidated	statements	of	income for	2018.

Following	elimination	of	the	DIPRO	rate,	the	Sistema	de	Divisa	Complementaria	("DICOM")	is	the	only	foreign	currency	exchange	mechanism	legally	available	to	us for	converting	Venezuelan	bolivars	to	U.S.	dollars.	As	of	December	29,	2018,	we	believe	the	DICOM	rate	is	the	most	appropriate	legally	available	rate	at	which	to translate	the	results	of	our	Venezuelan	subsidiary.	We	continue	to	monitor	the	DICOM	rate,	and	the	nonmonetary	assets	supported	by	the	underlying	operations	in Venezuela,	for	impairment.

The	auction-based	DICOM	system	was	temporarily	frozen	in	September	2017	and	reopened	in	February	2018.	The	last	published	DICOM	rate	before	the	auction	freeze was	BsF3,345	per	U.S.	dollar	compared	to	BsF25,000	per	U.S.	dollar	upon	reopening.	In	August	2018,	the	Venezuelan	government	changed	the	unit	for	measuring bolivars	from	 the	bolivar	fuerte	("BsF")	 to	 the	bolivar	soberano	("BsS").	The	conversion	ratio	 is	BsF100,000	 to	BsS1.	Upon	converting	 to	 the	bolivar	soberano measurement	unit,	the	Venezuelan	government	further	devalued	the	currency.	On	August	20,	2018,	the	published	DICOM	rate	was	BsF 6,000,000	(BsS60.00)	per	U.S. dollar	compared	to	approximately	BsF249,000	(BsS2.49)	per	U.S.	dollar	immediately	preceding	the	conversion	to	BsS.

The	DICOM	rate	at	December	29,	2018	was	BsS638.18	per	U.S.	dollar	compared	to	BsS0.03	at	December	30,	2017.	We	remeasured	the	bolivar	denominated	assets	and liabilities	of	our	Venezuelan	subsidiary	at	December	29,	2018	using	the	DICOM	spot	rate	of	BsS638.18	per	U.S.	dollar.	We	remeasured	the	income	statements	of	our Venezuelan	subsidiary	using	a	weighted	average	rate	of	BsS25.06	in	2018,	BsS0.02	in	2017,	and	BsS0.01	in	2016.	Remeasurements	of	the	monetary	assets	and	liabilities and	operating	results	of	our	Venezuelan	subsidiary	at	DICOM	rates	resulted	in	nonmonetary	currency	devaluation	losses	of	$146	million	in	2018,	$36	million	in	2017, and	$24	million	in	2016.	These	losses	were	recorded	in	other	expense/(income),	net	in	the	consolidated	statements	of	income.

Additionally,	in	the	second	quarter	of	2016,	we	assessed	the	nonmonetary	assets	of	our	Venezuelan	subsidiary	for	impairment,	resulting	in	a	$53	million	loss	to	write down	property,	plant	and	equipment,	net,	and	prepaid	spare	parts,	which	was	recorded	within	cost	of	products	sold	in	the	consolidated	statement	of	income	in	2016.

We	did	not	obtain	any	U.S.	dollars	at	DICOM	rates	during	2018.	In	addition	to	DICOM,	there	is	an	unofficial	market	for	obtaining	U.S.	dollars	with	Venezuelan bolivars.	The	exact	exchange	rate	is	widely	debated	but	is	generally	accepted	to	be	substantially	higher	than	the	latest	published	DICOM	rate.	We	have	not	transacted	at any	unofficial	market	rates	and	have	no	plans	to	transact	at	unofficial	market	rates	in	the	foreseeable	future.

Our	Venezuelan	subsidiary	obtains	U.S.	dollars	through	exports	and	royalty	payments.	These	U.S.	dollars	are	primarily	used	for	purchases	of	tomato	paste	and	spare parts	for	manufacturing,	as	well	as	a	limited	amount	of	other	operating	costs.	As	of	December	29,	2018,	our	Venezuelan	subsidiary	has	sufficient	U.S.	dollars	to	fund these	operational	needs	 in	 the	foreseeable	future.	However,	further	deterioration	of	 the	economic	environment	or	regulation	changes	could	 jeopardize	our	export business.	Our	Venezuelan	subsidiary	has	increasingly	sourced	production	inputs	locally,	including	tomato	paste	and	sugar,	in	order	to	reduce	reliance	on	U.S.	dollars, which	we	expect	to	continue	in	the	foreseeable	future.

Our	results	of	operations	in	Venezuela	reflect	a	controlled	subsidiary.	We	continue	to	have	sufficient	currency	liquidity	and	pricing	flexibility	to	control	our	operations. However,	the	continuing	economic	uncertainty,	strict	labor	laws,	and	evolving	government	controls	over	imports,	prices,	currency	exchange,	and	payments	present	a challenging	operating	environment.	Increased	restrictions	imposed	by	the	Venezuelan	government	or	further	deterioration	of	the	economic	environment	could	impact	our ability	to	control	our	Venezuelan	operations	and	could	lead	us	to	deconsolidate	our	Venezuelan	subsidiary	in	the	future.	We	currently	do	not	expect	to	make	any	new investments	or	contributions	into	Venezuela.

# Note	17.	Financing	Arrangements

We	have	utilized	accounts	receivable	securitization	and	factoring	programs	(the	"Programs")	globally	for	our	working	capital	needs	and	to	provide	efficient	liquidity. During	2018,	we	had	Programs	in	place	in	various	countries	across	the	globe.	In	the	second	quarter	of	2018,	we	unwound	our	U.S.	securitization	program,	which represented	the	majority	of	our	Programs,	using	proceeds	from	the	issuance	of	long-term	debt	in	June	2018.	As	of	December	29,	2018,	we	have	unwound	all	of	our Programs.

We	operated	the	Programs	such	that	we	generally	utilized	the	majority	of	the	available	aggregate	cash	consideration	limits.	We	accounted	for	transfers	of	receivables pursuant	to	the	Programs	as	a	sale	and	removed	them	from	our	consolidated	balance	sheets.	Under	the	Programs,	we	generally	received	cash	consideration	up	to	a	certain limit	and	recorded	a	non-cash	exchange	for	sold	receivables	for	the	remainder	of	the	purchase	price.	We	maintained	a	"beneficial	interest,"	or	a	right	to	collect	cash,	in the	sold	receivables.	Cash	receipts	from	the	payments	on	sold	receivables	(which	are	cash	receipts	on	the	underlying	trade	receivables	that	have	already	been	securitized in	these	Programs)	are	classified	as	investing	activities	and	presented	as	cash	receipts	on	sold	receivables	on	our	consolidated	statements	of	cash	flows.

The	carrying	value	of	trade	receivables	removed	from	our	consolidated	balance	sheets	in	connection	with	the	Programs	was	$1.0	billion	 at	December	30,	2017.	In exchange	for	the	sale	of	trade	receivables,	we	received	cash	of	$673	million	at	December	30,	2017	and	recorded	sold	receivables	of	$353	million	at	December	30,	2017. There	were	no	such	balances	at	December	29,	2018.	The	carrying	value	of	sold	receivables	approximated	the	fair	value	at	December	30,	2017.

We	acted	as	servicer	for	certain	of	the	Programs.	We	did	not	record	any	related	servicing	assets	or	liabilities	as	of	December	30,	2017	because	they	were	not	material	to the	financial	statements.

Our	U.S.	securitization	program	utilized	a	bankruptcy-remote	special-purpose	entity	("SPE").	The	SPE	was	wholly-owned	by	a	subsidiary	of	Kraft	Heinz,	and	its	sole business	consisted	of	the	purchase	or	acceptance,	through	capital	contributions,	of	receivables	and	related	assets	from	a	Kraft	Heinz	subsidiary	and	the	subsequent transfer	of	such	receivables	and	related	assets	to	a	bank.	Although	the	SPE	is	included	in	our	consolidated	financial	statements,	it	was	a	separate	legal	entity	with separate	creditors	who	were	entitled,	upon	its	liquidation	in	the	second	quarter	of	2018,	to	be	satisfied	out	of	the	SPE's	assets	prior	to	any	assets	or	value	in	the	SPE becoming	available	to	Kraft	Heinz	or	its	subsidiaries.

Additionally,	we	enter	into	various	structured	payable	and	product	financing	arrangements	to	facilitate	supply	from	our	vendors.	Balance	sheet	classification	is	based	on the	nature	of	the	agreements.	For	certain	arrangements,	we	classify	amounts	outstanding	within	other	current	liabilities	on	our	consolidated	balance	sheets.	We	had approximately	$267	 million	 on	 our	 consolidated	 balance	 sheets	 at	December	 29,	 2018	 and	 approximately	$268	 million	 at	December	 30,	 2017	 related	 to	 these arrangements.

# Note	18.	Commitments	and	Contingencies

# Legal	Proceedings

We	are	involved	in	legal	proceedings,	claims,	and	governmental	inquiries,	inspections,	or	investigations	("Legal	Matters")	arising	in	the	ordinary	course	of	our	business. While	we	cannot	predict	with	certainty	the	results	of	Legal	Matters	in	which	we	are	currently	involved	or	may	in	the	future	be	involved,	we	do	not	expect	that	the ultimate	costs	to	resolve	any	of	the	Legal	Matters	that	are	currently	pending	will	have	a	material	adverse	effect	on	our	financial	condition	or	results	of	operations.

# Class	Actions	and	Stockholder	Derivative	Actions:

We	and	certain	of	our	current	and	former	officers	and	directors	are	currently	defendants	in	three	securities	class	action	lawsuits	filed	in	February,	March,	and	April	2019. The	first	filed	action,	Hedick	v.	The	Kraft	Heinz	Company,	was	filed	on	February	24,	2019	against	the	Company	and	three	of	its	officers	(the	"Hedick	Action").	The second	filed	action,	Iron	Workers	District	Council	(Philadelphia	and	Vicinity)	Retirement	and	Pension	Plan	v.	The	Kraft	Heinz	Company,	was	filed	on	March	15,	2019 against,	among	others,	the	Company	and	six	of	its	current	and	former	officers	(the	"Iron	Workers	Action").	The	third	filed	action,	Timber	Hill	LLC	v.	The	Kraft	Heinz Company,	was	filed	on	April	25,	2019	against,	among	others,	the	Company	and	six	of	its	current	and	former	officers	and	one	of	its	directors	(the	"Timber	Hill	Action"). All	of	these	securities	class	action	lawsuits	were	filed	in	the	United	States	District	Court	for	the	Northern	District	of	Illinois.	Another	securities	class	action	lawsuit, Walling	v.	Kraft	Heinz	Company,	was	filed	on	February	26,	2019	in	the	United	States	District	Court	for	the	Western	District	of	Pennsylvania	against,	among	others,	the Company	and	six	of	its	current	and	former	officers	(the	"Walling	Action").	Plaintiff	in	the	Walling	Action	filed	a	notice	of	voluntary	dismissal	of	his	complaint,	without prejudice,	on	April	26,	2019.

Plaintiffs	in	these	lawsuits	purport	to	represent	a	class	of	all	individuals	and	entities	who	purchased,	sold,	or	otherwise	acquired	or	disposed	of	publicly	traded	securities of	the	Company	(including	in	the	Timber	Hill	Action,	the	purchase	of	call	options	on	Company	common	stock,	the	sale	of	put	options	on	Company	common	stock,	and the	purchase	of	futures	on	the	Company's	common	stock)	from	May	4,	2017	through	February	21,	2019,	in	the	case	of	the	Hedick	Action	and	the	Walling	Action,	and from	July	6,	2015	through	February	21,	2019,	in	the	case	of	the	Iron	Workers	Action	and	the	Timber	Hill	Action.	The	complaints	assert	claims	under	Sections	10(b)	and 20(a)	of	the	Securities	Exchange	Act	of	1934,	as	amended	(the	"Exchange	Act"),	and	Rule	10b-5	promulgated	thereunder,	based	on	allegedly	materially	false	or misleading	statements	and	omissions	in	public	statements,	press	releases,	investor	presentations,	earnings	calls,	and	SEC	filings	regarding	the	Company's	business, financial	results,	and	internal	controls.	The	plaintiffs	seek	damages	in	an	unspecified	amount,	attorneys'	fees	and	other	relief.

In	addition,	our	Employee	Benefits	Administration	Board	and	certain	of	our	current	and	former	employees	are	currently	defendants	in	one	class	action	lawsuit,	Osborne v.	 Employee	 Benefits	Administration	 Board	 of	 Kraft	 Heinz,	 which	 was	 filed	 on	 March	 19,	 2019 in	 the	 United	 States	 District	 Court	 for	 the	Western	 District	 of Pennsylvania.	Plaintiffs	in	the	lawsuit	purport	to	represent	a	class	of	current	and	former	employees	who	were	participants	in	and	beneficiaries	of	various	retirement	plans which	were	co-invested	in	a	commingled	investment	fund	known	as	the	Kraft	Foods	Savings	Plan	Master	Trust	(the	"Master	Trust")	during	the	period	of	May	4,	2017 through	February	21,	2019.		The	complaint	alleges	violations	of	Section	502	of	the	Employee	Retirement	Income	Security	Act	("ERISA")	based	on	alleged	breaches	of obligations	as	fiduciaries	subject	to	ERISA	by	allowing	the	Master	Trust	to	continue	investing	in	our	common	stock.	The	plaintiffs	seek	damages	in	an	unspecified amount,	attorneys'	fees,	and	other	relief.

Certain	of	our	current	and	former	officers	and	directors,	among	others,	are	also	currently	defendants	in	five	stockholder	derivative	actions:	DeFabiis	v.	Hees	filed	on April	16,	2019,	Vladimir	Gusinsky	Revocable	Trust	v.	Hees	filed	on	May	8,	2019,	Kailas	v.	Hees	filed	on	May	13,	2019,	Silverman	v.	Behring	filed	on	May	15,	2019, and	Green	v.	Behring	filed	on	May	23,	2019,	with	the	Company	named	as	a	nominal	defendant.	Plaintiffs,	derivatively	on	behalf	of	the	Company,	assert	claims	under	the common	law	and	statutory	law	of	Delaware	for	alleged	breaches	of	fiduciary	duties	as	well	as	alleged	violations	of	Sections	10(b)	and	14(a)	of	the	Exchange	Act	and Rule	10b-5	promulgated	thereunder,	based	on	allegedly	materially	false	or	misleading	statements	and	omissions	in	public	statements	and	SEC	filings.	The	plaintiffs	seek damages	in	an	unspecific	amount,	attorneys'	fees,	and	other	relief.	All	of	these	stockholder	derivative	actions	were	filed	in	the	United	States	District	Court	for	the Western	District	of	Pennsylvania.

We	intend	to	vigorously	defend	against	these	lawsuits;	however,	we	cannot	reasonably	estimate	the	potential	range	of	loss,	if	any,	due	to	the	early	stage	of	these proceedings.

# Securities	and	Exchange	Commission	Investigation:

As	previously	disclosed	on	February	21,	2019,	we	received	a	subpoena	in	October	2018	from	the	SEC	related	to	our	procurement	area,	specifically	the	accounting policies,	procedures,	and	internal	controls	related	to	our	procurement	function,	including,	but	not	limited	to,	agreements,	side	agreements,	and	changes	or	modifications to	agreements	with	our	suppliers.	Following	the	receipt	of	this	subpoena,	we,	together	with	external	counsel	and	forensic	accountants,	and	subsequently,	under	the oversight	of	the	Audit	Committee,	conducted	an	internal	investigation	into	our	procurement	area	and	related	matters.	Following	our	earnings	release	and	investor	call	on February	21,	2019,	when	we	announced	the	results	of	our	interim	assessment	of	goodwill	and	intangible	asset	impairments,	the	SEC	requested	additional	information related	to	our	financial	reporting,	internal	controls,	and	disclosures,	our	assessment	of	goodwill	and	intangible	asset	impairments,	and	our	communications	with	certain shareholders.	It	is	our	understanding	that	the	United	States	Attorney's	Office	for	the	Northern	District	of	Illinois	also	is	reviewing	this	matter,	working	with	the	SEC	and receiving	materials	from	it.	We	cannot	predict	the	eventual	scope,	duration	or	outcome	of	any	potential	SEC	legal	action	or	other	action	or	whether	it	could	have	a material	impact	on	our	financial	condition,	results	of	operations,	or	cash	flow.	We	have	been	responsive	to	the	ongoing	subpoenas	and	other	document	requests	and	will continue	to	cooperate	fully	with	any	governmental	or	regulatory	inquiries	or	investigations.

# Other	Commitments	and	Contingencies

As	a	result	of	our	review	of	supplier	contracts	and	related	arrangements,	we	determined	that	the	classification	of	the	embedded	lease	element	for	certain	contracts	should have	been	classified	as	an	operating	lease	instead	of	a	capital	lease.	In	addition,	we	identified	certain	arrangements	that	were	improperly	accounted	for	as	embedded capital	leases.	Therefore,	future	obligations	associated	with	operating	leases	and	purchase	obligations	have	been	restated	below.	See	Note	2,	Restatement	of	Previously Issued	Consolidated	Financial	Statements,	for	additional	information	related	to	the	restatement	and	our	review	of	supplier	contracts	and	related	arrangements.

Rental	expenses	for	leases	of	warehouse,	production,	and	office	facilities	and	equipment	were	$200	million	in	2018,	$244	million	in	2017,	and	$198	million	in	2016.

Minimum	rental	commitments	under	non-cancelable	operating	leases	in	effect	at	December	29,	2018	were	(in	millions):

| Minimum	rental	commitments	under	non-cancelable	operating	leases	in	effect	at	December	29,	2018	were	(in	millions): |  |
| :--- | :--- |
| 2019 | $185 |
| 2020 | 137 |
| 2021 | 105 |
| 2022 | 70 |
| 2023 | 49 |
| Thereafter | 148 |
| Total | $694 |

# Purchase	Obligations:

We	have	purchase	obligations	for	materials,	supplies,	property,	plant	and	equipment,	and	co-packing,	storage,	and	distribution	services	based	on	projected	needs	to	be utilized	in	the	normal	course	of	business.	Other	purchase	obligations	include	commitments	for	marketing,	advertising,	capital	expenditures,	information	technology,	and professional	services.

# As	of	December	29,	2018,	our	take-or-pay	purchase	obligations	were	as	follows	(in	millions):

# Redeemable	Noncontrolling	Interest:

In	2017,	we	commenced	operations	of	a	joint	venture	with	a	minority	partner	to	manufacture,	package,	market,	and	distribute	refrigerated	soups	and	meal	sides.	We control	operations	and	include	this	business	in	our	consolidated	results.	Our	minority	partner	has	put	options	that,	if	it	chooses	to	exercise,	would	require	us	to	purchase portions	of	its	equity	interest	at	a	future	date.	These	put	options	will	become	exercisable	beginning	in	2025	(on	the	eighth	anniversary	of	the	product	launch	date)	at	a price	to	be	determined	at	that	time	based	upon	an	independent	third	party	valuation.	The	minority	partner's	put	options	are	reflected	on	our	consolidated	balance	sheets as	a	redeemable	noncontrolling	interest.	We	accrete	the	redeemable	noncontrolling	interest	to	its	estimated	redemption	value	over	the	term	of	the	put	options.	At December	29,	2018,	we	estimate	the	redemption	value	to	be	approximately	$35	million.

# Borrowing	Arrangements:

On	July	6,	2015,	together	with	Kraft	Heinz	Foods	Company	("KHFC"),	our	100%	owned	operating	subsidiary,	we	entered	into	a	credit	agreement	(as	amended,	the "Credit	Agreement"),	 which	 provides	 for	 a	$4.0	billion	senior	unsecured	revolving	credit	facility	(the	"Senior	Credit	Facility").	In	June	2018,	we	entered	 into	an agreement	that	became	effective	on	July	6,	2018	to	extend	the	maturity	date	of	our	Senior	Credit	Facility	from	July	6,	2021	to	July	6,	2023	and	to	establish	a	$400 million	euro	equivalent	swing	line	facility,	which	is	available	under	the	$4.0	billion	revolving	credit	facility	limit	for	short-term	loans	denominated	in	euros	on	a	same- day	basis.

The	Senior	Credit	Facility	includes	a	$1.0	billion	sub-limit	for	borrowings	in	alternative	currencies	(i.e.,	euro,	sterling,	Canadian	dollars,	or	other	lawful	currencies readily	available	and	freely	transferable	and	convertible	into	U.S.	dollars),	as	well	as	a	letter	of	credit	sub-facility	of	up	to	$300	million.	Subject	to	certain	conditions,	we may	increase	the	amount	of	revolving	commitments	and/or	add	additional	tranches	of	term	loans	in	a	combined	aggregate	amount	of	up	to	$1.0	billion.

Any	committed	borrowings	under	 the	Senior	Credit	Facility	bear	 interest	at	a	variable	annual	rate	based	on	LIBOR/EURIBOR/CDOR	 loans	or	an	alternate	base rate/Canadian	prime	rate,	in	each	case	subject	to	an	applicable	margin	based	upon	the	long-term	senior	unsecured,	non-credit	enhanced	debt	rating	assigned	to	us.	The borrowings	under	the	Senior	Credit	Facility	have	interest	rates	based	on,	at	our	election,	base	rate,	LIBOR,	EURIBOR,	CDOR,	or	Canadian	prime	rate	plus	a	spread ranging	from	87.5	to	175	basis	points	for	LIBOR,	EURIBOR,	and	CDOR	loans,	and	0	to	75	basis	points	for	base	rate	or	Canadian	prime	rate	loans.

The	Senior	Credit	Facility	contains	representations,	warranties,	and	covenants	that	are	typical	for	these	types	of	facilities	and	could	upon	the	occurrence	of	certain	events of	default	restrict	our	ability	 to	access	our	Senior	Credit	Facility.	Our	Senior	Credit	Facility	requires	us	 to	maintain	a	minimum	shareholders'	equity	(excluding accumulated	other	comprehensive	income/(losses))	of	at	least	$35	billion.	We	were	in	compliance	with	all	financial	covenants	during	the	year	ended	December	29,	2018.

The	obligations	under	the	Credit	Agreement	are	guaranteed	by	KHFC	in	the	case	of	indebtedness	and	other	liabilities	of	any	subsidiary	borrower	and	by	Kraft	Heinz	in the	case	of	indebtedness	and	other	liabilities	of	any	subsidiary	borrower	and	KHFC.

In	 August	 2017,	 we	 repaid	$600	 million	 aggregate	 principal	 amount	 of	 our	 previously	 outstanding	 senior	 unsecured loan facility (the	 "Term	 Loan	 Facility"). Accordingly,	there	were	no	amounts	outstanding	on	the	Term	Loan	Facility	at	December	29,	2018	or	December	30,	2017.

We	obtain	funding	through	our	U.S.	and	European	commercial	paper	programs.	At	December	29,	2018,	we	had	no	commercial	paper	outstanding.	At	December	30, 2017,	we	had	commercial	paper	outstanding	of	$448	million	with	a	weighted	average	interest	rate	of	1.541%.

# Long-Term	Debt:

The	following	table	summarizes	our	long-term	debt	obligations.	Long-term	debt	at	December	30,	2017	reflects	the	restatements	described	in	Note	2,	Restatement	of Previously	Issued	Consolidated	Financial	Statements.

|  | Priority	(a) | Maturity	Dates | Interest	Rates	(b) | Carrying	Values | Carrying	Values |
| :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  |  |  | As\tRestated |
|  |  |  |  | December\t29,\t2018 | December\t30,\t2017 |
|  |  |  |  | (in\tmillions) | (in\tmillions) |
| U.S.\tdollar\tnotes: |  |  |  |  |  |
| 2025\tNotes(c) | Senior\tSecured\tNotes | February\t15,\t2025 | 4.875% | $1,193 | $1,192 |
| Other\tU.S.\tdollar\tnotes (d)(e) | Senior\tNotes | 2019-2046 | 2.800%\t-\t7.125% | 25,551 | 25,165 |
| Euro\tnotes(d) | Senior\tNotes | 2023-2028 | 1.500%\t-\t2.250% | 2,899 | 3,038 |
| Canadian\tdollar\tnotes(f) | Senior\tNotes | July\t6,\t2020 | 2.700%\t-\t3.128% | 586 | 794 |
| British\tpound\tsterling\tnotes: |  |  |  |  |  |
| 2030\tNotes(g) | Senior\tSecured\tNotes | February\t18,\t2030 | 6.250% | 165 | 176 |
| Other\tBritish\tpound\tsterling\tnotes (d) | Senior\tNotes | July\t1,\t2027 | 4.125% | 504 | 536 |
| Other\tlong-term\tdebt | Various | 2019-2035 | 0.800%\t-\t5.500% | 50 | 56 |
| Capital\tlease\tobligations |  |  |  | 199 | 84 |
| Total\tlong-term\tdebt |  |  |  | 31,147 | 31,041 |
| Current\tportion\tof\tlong-term\tdebt |  |  |  | 377 | 2,733 |
| Long-term\tdebt,\texcluding\tcurrent\tportion |  |  |  | $30,770 | $28,308 |

(a) Priority	of	debt	indicates	the	order	which	debt	would	be	paid	if	all	debt	obligations	were	due	on	the	same	day.	Senior	secured	debt	takes	priority	over	unsecured	debt.	Senior	debt	has	greater seniority	than	subordinated	debt.

(b) Floating	interest	rates	are	stated	as	of	December	29,	2018.

(c) The	4.875%	Second	Lien	Senior	Secured	Notes	due	February	15,	2025	(the	"2025	Notes")	are	senior	in	right	of	payment	of	existing	and	future	unsecured	and	subordinated	indebtedness.	Kraft Heinz	fully	and	unconditionally	guarantees	these	notes.

(d) Kraft	Heinz	fully	and	unconditionally	guarantees	these	notes,	which	were	issued	by	KHFC.

(e) Includes	current	year	issuances	(the	"New	Notes")	described	below.

(f) Kraft	Heinz	fully	and	unconditionally	guarantees	these	notes,	which	were	issued	by	Kraft	Heinz	Canada	ULC	(formerly	Kraft	Canada	Inc.).

(g) The	6.250%	Pound	Sterling	Senior	Secured	Notes	due	February	18,	2030	(the	"2030	Notes")	were	issued	by	H.J.	Heinz	Finance	UK	Plc.	Kraft	Heinz	and	KHFC	fully	and	unconditionally guarantee	the	2030	Notes.	This	guarantee	is	secured	and	senior	in	right	of	payment	of	existing	and	future	unsecured	and	subordinated	indebtedness.	Kraft	Heinz	became	guarantor	of	the	2030 Notes	in	connection	with	the	2015	Merger.	The	2030	Notes	were	previously	only	guaranteed	by	KHFC.

Our	long-term	debt	contains	customary	representations,	covenants,	and	events	of	default.	We	were	in	compliance	with	all	financial	covenants	during	the	year	ended December	29,	2018.

At	December	29,	2018,	our	long-term	debt	excluded	amounts	classified	as	held	for	sale.	See	Note	5,	Acquisitions	and	Divestitures,	for	additional	information.

At	December	29,	2018,	aggregate	principal	maturities	of	our	long-term	debt	excluding	capital	leases	were	(in	millions):

# Debt	Issuances:

In	June	2018,	KHFC,	our	100%	owned	operating	subsidiary,	issued	$300	million	aggregate	principal	amount	of	3.375%	senior	notes	due	2021,	$1.6	billion	aggregate principal	amount	of	4.000%	senior	notes	due	2023,	and	$1.1	billion	aggregate	principal	amount	of	4.625%	senior	notes	due	2029	(collectively,	the	"New	Notes").	The New	Notes	are	fully	and	unconditionally	guaranteed	by	Kraft	Heinz	as	to	payment	of	principal,	premium,	and	interest	on	a	senior	unsecured	basis.

We	used	approximately	$500	million	of	the	proceeds	from	the	New	Notes	in	connection	with	the	wind-down	of	our	U.S.	securitization	program	in	the	second	quarter	of 2018.	We	also	used	proceeds	from	the	New	Notes	to	refinance	a	portion	of	our	commercial	paper	borrowings	in	the	second	quarter	of	2018,	to	repay	certain	notes	that matured	in	July	and	August	2018,	and	for	other	general	corporate	purposes.

In	August	2017,	KHFC	issued	$350	million	aggregate	principal	amount	of	floating	rate	senior	notes	due	2019,	$650	million	aggregate	principal	amount	of	floating	rate senior	notes	due	2021,	and	$500	million	aggregate	principal	amount	of	floating	rate	senior	notes	due	2022	(collectively,	the	"2017	Notes").	The	2017	Notes	are	fully	and unconditionally	guaranteed	by	Kraft	Heinz	as	to	payment	of	principal,	premium,	and	interest	on	a	senior	unsecured	basis.

We	used	the	net	proceeds	from	the	2017	Notes	primarily	to	repay	all	amounts	outstanding	under	our	$600	million	Term	Loan	Facility	together	with	accrued	interest thereon,	to	refinance	a	portion	of	our	commercial	paper	programs,	and	for	other	general	corporate	purposes.

In	May	2016,	KHFC	issued	$2.0	billion	aggregate	principal	amount	of	3.000%	senior	notes	due	June	2026,	$3.0	billion	aggregate	principal	amount	of	4.375%	senior notes	due	June	2046,	€550	million	aggregate	principal	amount	of	1.500%	senior	notes	due	May	2024,	and	€1,250	million	aggregate	principal	amount	of	2.250%	senior notes	due	May	2028	(collectively,	the	"2016	Notes").	The	2016	Notes	are	fully	and	unconditionally	guaranteed	by	Kraft	Heinz	as	to	payment	of	principal,	premium,	and interest	on	a	senior	unsecured	basis.

We	used	the	net	proceeds	from	the	2016	Notes	primarily	to	redeem	all	outstanding	shares	of	our	9.00%	cumulative	compounding	preferred	stock,	Series	A	("Series	A Preferred	Stock")	for	$8.3	billion.	See	Note	20,	Capital	Stock,	for	additional	information.

# Debt	Issuance	Costs:

Debt	issuance	costs	are	reflected	as	a	direct	deduction	of	our	long-term	debt	balance	on	the	consolidated	balance	sheets.	We	incurred	debt	issuance	costs	of	$15	million in	2018	and	$53	million	in	2016.	Debt	issuance	costs	in	2017	were	insignificant.	Unamortized	debt	issuance	costs	were	$115	million	at	December	29,	2018,	$114	million at	December	30,	2017,	and	$124	million	at	December	31,	2016.	Amortization	of	debt	issuance	costs	was	$16	million	in	2018,	$16	million	in	2017,	and	$14	million	in 2016.

# Debt	Premium:

Unamortized	debt	premiums	are	presented	on	the	consolidated	balance	sheets	as	a	direct	addition	to	the	carrying	amount	of	debt.	Unamortized	debt	premium,	net, was	$430	million	at	December	29,	2018	and	$505	million	at	December	30,	2017.	Amortization	of	our	debt	premium,	net,	was	$65	million	in	2018,	$81	million	in	2017, and	$88	million	in	2016.

# Debt	Repayments:

In	July	and	August	2018,	we	repaid	$2.7	billion	aggregate	principal	amount	of	senior	notes	that	matured	in	the	period.	We	funded	these	long-term	debt	repayments primarily	with	proceeds	from	the	New	Notes	issued	in	June	2018.

Additionally,	in	June	2017,	we	repaid	$2.0	billion	aggregate	principal	amount	of	senior	notes	that	matured	in	the	period.	We	funded	these	long-term	debt	repayments primarily	with	cash	on	hand	and	our	commercial	paper	programs.

# Fair	Value	of	Debt:

At	December	29,	2018,	the	aggregate	fair	value	of	our	total	debt	was	$30.1	billion	as	compared	with	a	carrying	value	of	$31.2	billion.	 At	December	30,	2017,	the aggregate	fair	value	of	our	total	debt	was	$33.0	billion	as	compared	with	a	carrying	value	of	$31.5	billion.	Our	short-term	debt	and	commercial	paper	had	carrying	values that	approximated	their	fair	values	at	December	29,	2018	and	December	30,	2017.	We	determined	the	fair	value	of	our	long-term	debt	using	Level	2	inputs.	Fair	values are	generally	estimated	based	on	quoted	market	prices	for	identical	or	similar	instruments.

# Note	20.	Capital	Stock

# Preferred	Stock

Our	Second	Amended	and	Restated	Certificate	of	Incorporation	authorizes	the	issuance	of	up	to	920,000	shares	of	preferred	stock.

On	June	7,	2016,	we	redeemed	all	80,000	outstanding	shares	of	our	Series	A	Preferred	Stock	for	$8.3	billion.	We	funded	this	redemption	primarily	through	the	issuance of	long-term	debt	in	May	2016,	as	well	as	other	sources	of	liquidity,	including	our	U.S.	commercial	paper	program,	U.S.	securitization	program,	and	cash	on	hand.	In connection	with	the	redemption,	all	Series	A	Preferred	Stock	was	canceled	and	automatically	retired.

# Common	Stock

Our	Second	Amended	and	Restated	Certificate	of	Incorporation	authorizes	the	issuance	of	up	to	5.0	billion	shares	of	common	stock.

Shares	of	common	stock	issued,	in	treasury,	and	outstanding	were	(in	millions	of	shares):

|  | Shares	Issued | Treasury	Shares | Shares<br>Outstanding |
| :--- | :--- | :--- | :--- |
| Balance\tat\tJanuary\t3,\t2016 | 1,214 | — | 1,214 |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\tstock\tawards,\tand\tother | 5 | (2) | 3 |
| Balance\tat\tDecember\t31,\t2016 | 1,219 | (2) | 1,217 |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\tstock\tawards,\tand\tother | 2 | — | 2 |
| Balance\tat\tDecember\t30,\t2017 | 1,221 | (2) | 1,219 |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\tstock\tawards,\tand\tother | 3 | (2) | 1 |
| Balance\tat\tDecember\t29,\t2018 | 1,224 | (4) | 1,220 |

# Note	21.	Earnings	Per	Share

Our	earnings	per	common	share	("EPS")	were:

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
|  |  | (in\tmillions,\texcept\tper\tshare\tdata) |  |
| Basic\tEarnings\tPer\tCommon\tShare: |  |  |  |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $(10,192) | $10,941 | $3,416 |
| Weighted\taverage\tshares\tof\tcommon\tstock\toutstanding | 1,219 | 1,218 | 1,217 |
| Net\tearnings/(loss) | $(8.36) | $8.98 | $2.81 |
| Diluted\tEarnings\tPer\tCommon\tShare: |  |  |  |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $(10,192) | $10,941 | $3,416 |
| Weighted\taverage\tshares\tof\tcommon\tstock\toutstanding | 1,219 | 1,218 | 1,217 |
| Effect\tof\tdilutive\tequity\tawards | — | 10 | 9 |
| Weighted\taverage\tshares\tof\tcommon\tstock\toutstanding,\tincluding\tdilutive\teffect | 1,219 | 1,228 | 1,226 |
| Net\tearnings/(loss) | $(8.36) | $8.91 | $2.78 |

Basic	and	diluted	EPS	for	the	years	ended	December	30,	2017	and	December	31,	2016	reflect	the	restatements	that	impacted	net	income/(loss)	attributable	to	common shareholders.	The	restatements	had	no	 impact	on	weighted	average	shares	of	common	stock	outstanding	or	dilutive	equity	awards	 in	prior	periods.	See	Note	2, Restatement	of	Previously	Issued	Consolidated	Financial	Statements,	for	additional	information.

We	use	the	treasury	stock	method	to	calculate	the	dilutive	effect	of	outstanding	equity	awards	in	the	denominator	for	diluted	EPS.	We	had	net	losses	attributable	to common	shareholders	in	2018.	Therefore,	we	have	excluded	the	dilutive	effects	of	equity	awards	in	2018	as	their	inclusion	would	have	had	an	anti-dilutive	effect	on EPS.	Anti-dilutive	shares	were	13	million	in	2018,	2	million	in	2017,	and	3	million	in	2016.

# Note	22.	Segment	Reporting

Management	evaluates	segment	performance	based	on	several	factors,	including	net	sales	and	Segment	Adjusted	EBITDA.	Segment	Adjusted	EBITDA	is	defined	as	net income/(loss)	 from	 continuing	 operations	 before	 interest	 expense,	 other	 expense/(income),	 net,	 provision	 for/(benefit	 from)	 income	 taxes,	 and	 depreciation	 and amortization	 (excluding	 integration	 and	 restructuring	 expenses);	 in	 addition	 to	 these	 adjustments,	 we	 exclude,	 when	 they	 occur,	 the	 impacts	 of	 integration	 and restructuring	expenses,	deal	costs,	unrealized	gains/(losses)	on	commodity	hedges	(the	unrealized	gains	and	losses	are	recorded	in	general	corporate	expenses	until realized;	once	realized,	the	gains	and	losses	are	recorded	in	the	applicable	segment's	operating	results),	impairment	losses,	gains/(losses)	on	the	sale	of	a	business,	other gains/(losses)	related	to	acquisitions	and	divestitures	(e.g.,	tax	and	hedging	impacts),	nonmonetary	currency	devaluation	(e.g.,	remeasurement	gains	and	losses),	and equity	award	compensation	expense	(excluding	integration	and	restructuring	expenses).	Segment	Adjusted	EBITDA	is	a	tool	that	can	assist	management	and	investors	in comparing	our	performance	on	a	consistent	basis	by	removing	the	impact	of	certain	items	that	management	believes	do	not	directly	reflect	our	underlying	operations. Management	uses	Segment	Adjusted	EBITDA	to	evaluate	segment	performance	and	allocate	resources.

Management	does	not	use	assets	by	segment	to	evaluate	performance	or	allocate	resources.	Therefore,	we	do	not	disclose	assets	by	segment.

Net	sales	by	segment	were	(in	millions):

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Net\tsales: |  |  |  |
| United\tStates | $18,122 | $18,230 | $18,469 |
| Canada | 2,173 | 2,177 | 2,302 |
| EMEA | 2,718 | 2,585 | 2,586 |
| Rest\tof\tWorld | 3,255 | 3,084 | 2,943 |
| Total\tnet\tsales | $26,268 | $26,076 | $26,300 |

Net	sales	for	the	years	ended	December	30,	2017	and	December	31,	2016	reflect	the	restatements	described	in	Note	2,	Restatement	of	Previously	Issued	Consolidated Financial	Statements.

Segment	Adjusted	EBITDA	was	(in	millions):

|  | December	29,<br>2018 | As	Restated	&amp;	Recast<br>December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Segment\tAdjusted\tEBITDA: |  |  |  |
| United\tStates | $5,218 | $5,873 | $5,744 |
| Canada | 608 | 636 | 632 |
| EMEA | 724 | 673 | 741 |
| Rest\tof\tWorld | 635 | 590 | 621 |
| General\tcorporate\texpenses | (161) | (108) | (164) |
| Depreciation\tand\tamortization\t(excluding\tintegration\tand\trestructuring\texpenses) | (919) | (907) | (875) |
| Integration\tand\trestructuring\texpenses | (297) | (583) | (992) |
| Deal\tcosts | (23) | — | (30) |
| Unrealized\tgains/(losses)\ton\tcommodity\thedges | (21) | (19) | 38 |
| Impairment\tlosses | (15,936) | (49) | (71) |
| Gains/(losses)\ton\tsale\tof\tbusiness | (15) | — | — |
| Nonmonetary\tcurrency\tdevaluation | — | — | (4) |
| Equity\taward\tcompensation\texpense\t(excluding\tintegration\tand\trestructuring\texpenses) | (33) | (49) | (39) |
| Operating\tincome/(loss) | (10,220) | 6,057 | 5,601 |
| Interest\texpense | 1,284 | 1,234 | 1,134 |
| Other\texpense/(income),\tnet | (183) | (627) | (472) |
| Income/(loss)\tbefore\tincome\ttaxes | $(11,321) | $5,450 | $4,939 |

Segment	Adjusted	EBITDA	for	the	years	ended	December	30,	2017	and	December	31,	2016	reflects	restatements	and	has	been	recast	to	reflect	the	impact	of	adopting ASU	2017-07	in	the	first	quarter	of	2018.	See	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements,	for	additional	information.	In	addition,	see Note	23,	Quarterly	Financial	Data	(Unaudited),	for	restated	Segment	Adjusted	EBITDA	for	the	interim	periods	within	fiscal	years	2018	and	2017.

Total	depreciation	and	amortization	expense	by	segment	was	(in	millions):

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Depreciation\tand\tamortization\texpense: |  |  |  |
| United\tStates | $626 | $658 | $966 |
| Canada | 39 | 48 | 56 |
| EMEA | 102 | 99 | 87 |
| Rest\tof\tWorld | 119 | 98 | 84 |
| General\tcorporate\texpenses | 97 | 128 | 144 |
| Total\tdepreciation\tand\tamortization\texpense | $983 | $1,031 | $1,337 |

Depreciation	 and	 amortization	 expense for the	 year	 ended	 December	 30,	 2017 reflects the restatements	 described in	 Note	 2,	Restatement	 of	 Previously Issued Consolidated	Financial	Statements.

The	decrease	in	depreciation	and	amortization	expense	in	2017	compared	to	2016	was	primarily	driven	by	accelerated	depreciation	recognized	in	2016	resulting	from factory	closures	as	part	of	our	Integration	Program.	See	Note	6,	Integration	and	Restructuring	Expenses,	for	additional	information.

Total	capital	expenditures	by	segment	were	(in	millions):

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Capital\texpenditures: |  |  |  |
| United\tStates | $388 | $764 | $843 |
| Canada | 21 | 42 | 30 |
| EMEA | 124 | 127 | 115 |
| Rest\tof\tWorld | 236 | 184 | 96 |
| General\tcorporate\texpenses | 57 | 77 | 163 |
| Total\tcapital\texpenditures | $826 | $1,194 | $1,247 |

Capital	expenditures	for	the	year	ended	December	30,	2017	reflect	the	restatements	described	in	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial Statements.

Net	sales	by	product	category	were	(in	millions):

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Condiments\tand\tsauces | $6,752 | $6,429 | $6,297 |
| Cheese\tand\tdairy | 5,287 | 5,409 | 5,537 |
| Ambient\tfoods | 2,576 | 2,564 | 2,488 |
| Frozen\tand\tchilled\tfoods | 2,548 | 2,578 | 2,577 |
| Meats\tand\tseafood | 2,505 | 2,567 | 2,659 |
| Refreshment\tbeverages | 1,507 | 1,506 | 1,517 |
| Coffee | 1,438 | 1,422 | 1,489 |
| Infant\tand\tnutrition | 756 | 755 | 761 |
| Desserts,\ttoppings\tand\tbaking | 1,038 | 1,033 | 1,054 |
| Nuts\tand\tsalted\tsnacks | 967 | 970 | 1,069 |
| Other | 894 | 843 | 852 |
| Total\tnet\tsales | $26,268 | $26,076 | $26,300 |

In	2018,	we	reorganized	the	products	within	our	product	categories	to	reflect	how	we	manage	our	business.	We	have	reflected	this	change	for	all	historical	periods presented.	In	addition,	net	sales	by	product	category	for	the	years	ended	December	30,	2017	and	December	31,	2016	reflect	the	restatements	described	in	Note	2,

# Concentration	of	Risk:

Our	largest	customer,	Walmart	Inc.,	represented	approximately	21%	of	our	net	sales	in	2018,	21%	of	our	net	sales	in	2017,	and	approximately	22%	of	our	net	sales	in 2016.	All	of	our	segments	have	sales	to	Walmart	Inc.

# Geographic	Financial	Information:

We	had	significant	sales	in	the	United	States,	Canada,	and	the	United	Kingdom.	Our	net	sales	by	geography	were	(in	millions):

|  | December	29,<br>2018 | December	30,<br>2017 | December	31,<br>2016 |
| :--- | :--- | :--- | :--- |
| Net\tsales: |  |  |  |
| United\tStates | $18,218 | $18,324 | $18,556 |
| Canada | 2,173 | 2,177 | 2,302 |
| United\tKingdom | 1,071 | 1,018 | 1,053 |
| Other | 4,806 | 4,557 | 4,389 |
| Total\tnet\tsales | $26,268 | $26,076 | $26,300 |

Net	sales	by	geography	for	the	years	ended	December	30,	2017	and	December	31,	2016	reflect	the	restatements	described	in	Note	2,	Restatement	of	Previously	Issued Consolidated	Financial	Statements.

We	had	significant long-lived	assets in the	United	States,	Canada,	and the	United	Kingdom.	Long-lived	assets include	property,	plant	and	equipment,	goodwill, trademarks,	and	other	intangible	assets,	net	of	related	depreciation	and	amortization.	Our	long-lived	assets	by	geography	were	(in	millions):

A t	December	 29,	 2018, long-lived	 assets	 by	 geography	 excluded	 amounts	 classified	 as	 held for sale.	 See	 Note	 5,	Acquisitions	 and	 Divestitures, for	 additional information.	Long-lived	assets	at	December	30,	2017	reflect	the	restatements	described	in	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements.

# Note	23.	Quarterly	Financial	Data	(Unaudited)

Our	quarterly	financial	data	for	2018	and	2017	is	summarized	as	follows:

|  | Fourth | Third | Second | First |
| :--- | :--- | :--- | :--- | :--- |
|  |  | (in\tmillions,\texcept\tper\tshare\tdata) | (in\tmillions,\texcept\tper\tshare\tdata) |  |
| Net\tsales | $6,891 | $6,383 | $6,690 | $6,304 |
| Gross\tprofit | 2,216 | 2,094 | 2,347 | 2,264 |
| Net\tincome/(loss) | (12,628) | 618 | 753 | 1,003 |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | (12,568) | 619 | 754 | 1,003 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |
| Basic\tearnings/(loss) | (10.30) | 0.51 | 0.62 | 0.82 |
| Diluted\tearnings/(loss) | (10.30) | 0.50 | 0.62 | 0.82 |

|  | Fourth | Third | Second | First |
| :--- | :--- | :--- | :--- | :--- |
|  |  | (in\tmillions,\texcept\tper\tshare\tdata) | (in\tmillions,\texcept\tper\tshare\tdata) |  |
| Net\tsales | $6,841 | $6,279 | $6,634 | $6,322 |
| Gross\tprofit | 2,287 | 2,156 | 2,407 | 2,183 |
| Net\tincome/(loss) | 7,982 | 912 | 1,157 | 881 |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | 7,989 | 913 | 1,156 | 883 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |
| Basic\tearnings/(loss) | 6.55 | 0.75 | 0.95 | 0.73 |
| Diluted\tearnings/(loss) | 6.50 | 0.74 | 0.94 | 0.72 |

# Restatement	of	Previously	Issued	Unaudited	Condensed	Consolidated	Financial	Statements

We	have	restated	herein	our	previously	issued	unaudited	condensed	consolidated	financial	statements	for	each	interim	period	within	the	nine	months	ended	September 29,	2018	and	the	fiscal	year	ended	December	30,	2017.	See	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements,	for	additional	information.

The	following	tables	represent	our	restated	unaudited	condensed	consolidated	financial	statements	for	each	quarter-to-date	and	year-to-date	interim	period	within	the nine	months	ended	September	29,	2018	and	the	fiscal	year	ended	December	30,	2017	and	at	each	interim	period	therein.	The	2018	quarterly	restatements	will	be effective	with	the	filing	of	our	future	2019	unaudited	interim	condensed	consolidated	financial	statement	filings	in	Quarterly	Reports	on	Form	10-Q.

The	values	as	previously	reported	for	the	fiscal	quarters	ended	September	29,	2018,	June	30,	2018,	and	March	31,	2018	were	derived	from	our	Quarterly	Reports	on Form	10-Q	filed	on	November	2,	2018,	August	3,	2018,	and	May	3,	2018,	respectively.	The	values	as	previously	reported	for	the	fiscal	quarter	ended	December	30,	2017 were	derived	from	our	Annual	Report	on	Form	10-K	for	the	year	ended	December	30,	2017	filed	on	February	16,	2018.	The	values	as	previously	reported	for	the	fiscal quarters	ended	September	30,	2017,	July	1,	2017,	and	April	1,	2017	were	derived	from	our	Quarterly	Reports	on	Form	10-Q,	as	amended	for	the	first	and	second quarters,	all	of	which	were	filed	on	November	7,	2017.	See	 Note	 2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements,	for	a	description	of	the misstatements	in	each	category	of	restatements	referenced	by	(a)	through	(g).

In	addition,	the	condensed	consolidated	statements	of	income	for	the	interim	periods	within	the	year	ended	December	30,	2017,	as	previously	reported,	did	not	originally reflect	the	adoption	of	ASU	2017-07	related	to	the	presentation	of	net	periodic	benefit	cost	(pension	and	postretirement	cost).	This	ASU	was	adopted	in	the	first	quarter	of 2018	and	was	applied	retrospectively	for	statement	of	income	presentation	of	service	cost	components	and	other	net	periodic	benefit	cost	components.	Our	condensed consolidated	statements	of	income	for	the	interim	periods	within	fiscal	year	2017	have	been	recast	accordingly.	See	Note	4,	New	Accounting	Standards,	for	additional information	related	to	our	adoption	of	ASU	2017-07.

# Condensed	Consolidated	Statements	of	Income

|  | December	29,	2018 | September	29,<br>	2018 |  | June	30,<br>2018 |  | March	31,	2018 |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Three\tMonths\nEnded | Three\tMonths\nEnded | Nine\tMonths\tEnded | Three\tMonths\nEnded | Six\tMonths\tEnded | Three\tMonths\nEnded |
| Net\tsales | $6,891 | $6,383 | $19,377 | $6,690 | $12,994 | $6,304 |
| Cost\tof\tproducts\tsold | 4,675 | 4,289 | 12,672 | 4,343 | 8,383 | 4,040 |
| Gross\tprofit | 2,216 | 2,094 | 6,705 | 2,347 | 4,611 | 2,264 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\nexcluding\timpairment\tlosses | 867 | 803 | 2,338 | 771 | 1,535 | 764 |
| Goodwill\timpairment\tlosses | 6,875 | — | 133 | 133 | 133 | — |
| Intangible\tasset\timpairment\tlosses | 8,610 | 217 | 318 | 101 | 101 | — |
| Selling,\tgeneral\tand\tadministrative\texpenses | 16,352 | 1,020 | 2,789 | 1,005 | 1,769 | 764 |
| Operating\tincome/(loss) | (14,136) | 1,074 | 3,916 | 1,342 | 2,842 | 1,500 |
| Interest\texpense | 325 | 326 | 959 | 316 | 633 | 317 |
| Other\texpense/(income),\tnet | 13 | (71) | (196) | (35) | (125) | (90) |
| Income/(loss)\tbefore\tincome\ttaxes | (14,474) | 819 | 3,153 | 1,061 | 2,334 | 1,273 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | (1,846) | 201 | 779 | 308 | 578 | 270 |
| Net\tincome/(loss) | (12,628) | 618 | 2,374 | 753 | 1,756 | 1,003 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\ninterest | (60) | (1) | (2) | (1) | (1) | — |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | (12,568) | 619 | 2,376 | 754 | 1,757 | 1,003 |
| Preferred\tdividends | — | — | — | — | — | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\nshareholders | $(12,568) | $619 | $2,376 | $754 | $1,757 | $1,003 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |  |  |
| Basic\tearnings/(loss) | $(10.30) | $0.51 | $1.95 | $0.62 | $1.44 | $0.82 |
| Diluted\tearnings/(loss) | (10.30) | 0.50 | 1.94 | 0.62 | 1.43 | 0.82 |

# As	Restated	&	Recast

|  | December	30,	2017 | September	30,<br>	2017 |  | July	1,<br>2017 |  | April	1,<br>2017 |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Three\tMonths\nEnded | Three\tMonths\nEnded | Nine\tMonths\tEnded | Three\tMonths\nEnded | Six\tMonths\tEnded | Three\tMonths\nEnded |
| Net\tsales | $6,841 | $6,279 | $19,235 | $6,634 | $12,956 | $6,322 |
| Cost\tof\tproducts\tsold | 4,554 | 4,123 | 12,489 | 4,227 | 8,366 | 4,139 |
| Gross\tprofit | 2,287 | 2,156 | 6,746 | 2,407 | 4,590 | 2,183 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\nexcluding\timpairment\tlosses | 778 | 664 | 2,149 | 720 | 1,485 | 765 |
| Goodwill\timpairment\tlosses | — | — | — | — | — | — |
| Intangible\tasset\timpairment\tlosses | — | 1 | 49 | 48 | 48 | — |
| Selling,\tgeneral\tand\tadministrative\texpenses | 778 | 665 | 2,198 | 768 | 1,533 | 765 |
| Operating\tincome/(loss) | 1,509 | 1,491 | 4,548 | 1,639 | 3,057 | 1,418 |
| Interest\texpense | 308 | 306 | 926 | 307 | 620 | 313 |
| Other\texpense/(income),\tnet | (116) | (127) | (511) | (254) | (384) | (130) |
| Income/(loss)\tbefore\tincome\ttaxes | 1,317 | 1,312 | 4,133 | 1,586 | 2,821 | 1,235 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | (6,665) | 400 | 1,183 | 429 | 783 | 354 |
| Net\tincome/(loss) | 7,982 | 912 | 2,950 | 1,157 | 2,038 | 881 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\ninterest | (7) | (1) | (2) | 1 | (1) | (2) |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 7,989 | 913 | 2,952 | 1,156 | 2,039 | 883 |
| Preferred\tdividends | — | — | — | — | — | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\nshareholders | $7,989 | $913 | $2,952 | $1,156 | $2,039 | $883 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |  |  |
| Basic\tearnings/(loss) | $6.55 | $0.75 | $2.42 | $0.95 | $1.67 | $0.73 |
| Diluted\tearnings/(loss) | 6.50 | 0.74 | 2.40 | 0.94 | 1.66 | 0.72 |

# Condensed	Consolidated	Statements	of	Comprehensive	Income

|  | December	29,<br>2018 | September	29,<br>	2018 |  | June	30,<br>2018 |  | March	31,	2018 |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Three\tMonths\nEnded | Three\tMonths\nEnded | Nine\tMonths\tEnded | Three\tMonths\nEnded | Six\tMonths\tEnded | Three\tMonths\nEnded |
| Net\tincome/(loss) | $(12,628) | $618 | $2,374 | $753 | $1,756 | $1,003 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | (378) | (144) | (809) | (862) | (665) | 197 |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\nhedges | 126 | 13 | 158 | 219 | 145 | (74) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\nassessment\tof\tnet\tinvestment\thedges | 4 | 3 | 3 | — | — | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\nhedges\treclassified\tto\tnet\tincome/(loss) | (5) | (2) | (2) | — | — | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | 59 | (16) | 40 | 34 | 56 | 22 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\nassessment\tof\tcash\tflow\thedges | 2 | — | — | — | — | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\nreclassified\tto\tnet\tincome/(loss) | (34) | 12 | (10) | (9) | (22) | (13) |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\nperiod | (12) | 17 | 70 | 53 | 53 | — |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\nperiod | 3 | — | — | — | — | — |
| Net\tpostemployment\tbenefit\tlosses/(gains)\nreclassified\tto\tnet\tincome/(loss) | 15 | (58) | (133) | (17) | (75) | (58) |
| Total\tother\tcomprehensive\tincome/(loss) | (220) | (175) | (683) | (582) | (508) | 74 |
| Total\tcomprehensive\tincome/(loss) | (12,848) | 443 | 1,691 | 171 | 1,248 | 1,077 |
| Comprehensive\tincome/(loss)\tattributable\tto\nnoncontrolling\tinterest | (61) | (3) | (15) | (7) | (12) | (5) |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\nHeinz | $(12,787) | $446 | $1,706 | $178 | $1,260 | $1,082 |

|  | December	30,<br>2017 | September	30,<br>	2017 |  | July	1,<br>2017 |  | April	1,<br>2017 |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Three\tMonths\nEnded | Three\tMonths\nEnded | Nine\tMonths\tEnded | Three\tMonths\nEnded | Six\tMonths\tEnded | Three\tMonths\nEnded |
| Net\tincome/(loss) | $7,982 | $912 | $2,950 | $1,157 | $2,038 | $881 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | 7 | 419 | 1,178 | 455 | 759 | 304 |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\nhedges | (26) | (124) | (327) | (152) | (203) | (51) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\nassessment\tof\tnet\tinvestment\thedges | — | — | — | — | — | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\nhedges\treclassified\tto\tnet\tincome/(loss) | — | — | — | — | — | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | 23 | (70) | (136) | (32) | (66) | (34) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\nassessment\tof\tcash\tflow\thedges | — | — | — | — | — | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\nreclassified\tto\tnet\tincome/(loss) | (12) | 51 | 97 | 26 | 46 | 20 |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\nperiod | 82 | (4) | (13) | 1 | (9) | (10) |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\nperiod | 16 | — | 1 | 1 | 1 | — |
| Net\tpostemployment\tbenefit\tlosses/(gains)\nreclassified\tto\tnet\tincome/(loss) | (49) | (51) | (260) | (154) | (209) | (55) |
| Total\tother\tcomprehensive\tincome/(loss) | 41 | 221 | 540 | 145 | 319 | 174 |
| Total\tcomprehensive\tincome/(loss) | 8,023 | 1,133 | 3,490 | 1,302 | 2,357 | 1,055 |
| Comprehensive\tincome/(loss)\tattributable\tto\nnoncontrolling\tinterest | 1 | (1) | (4) | 1 | (3) | (4) |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\nHeinz | $8,022 | $1,134 | $3,494 | $1,301 | $2,360 | $1,059 |

# Condensed	Consolidated	Balance	Sheets

|  | September	29,<br>2018 | June	30,<br>2018 | March	31,<br>2018 |
| :--- | :--- | :--- | :--- |
| ASSETS |  |  |  |
| Cash\tand\tcash\tequivalents | $1,366 | $3,369 | $1,794 |
| Trade\treceivables\t(net\tof\tallowances\tof\t$24\tat\tSeptember\t29,\t2018,\t$24\tat\tJune\t30,\t2018,\tand\t$24\tat\tMarch\n31,\t2018) | 2,032 | 1,950 | 1,044 |
| Sold\treceivables | — | 37 | 530 |
| Income\ttaxes\treceivable | 203 | 211 | 121 |
| Inventories | 3,214 | 3,094 | 3,089 |
| Prepaid\texpenses | 389 | 388 | 367 |
| Other\tcurrent\tassets | 352 | 431 | 426 |
| Assets\theld\tfor\tsale | — | — | — |
| Total\tcurrent\tassets | 7,556 | 9,480 | 7,371 |
| Property,\tplant\tand\tequipment,\tnet | 7,074 | 7,117 | 7,145 |
| Goodwill | 44,339 | 44,302 | 44,844 |
| Intangible\tassets,\tnet | 58,727 | 59,084 | 59,583 |
| Other\tnon-current\tassets | 1,879 | 1,766 | 1,640 |
| TOTAL\tASSETS | $119,575 | $121,749 | $120,583 |
| LIABILITIES\tAND\tEQUITY |  |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $973 | $34 | $1,003 |
| Current\tportion\tof\tlong-term\tdebt | 371 | 2,723 | 2,715 |
| Trade\tpayables | 4,238 | 4,236 | 4,148 |
| Accrued\tmarketing | 494 | 480 | 576 |
| Interest\tpayable | 315 | 404 | 345 |
| Other\tcurrent\tliabilities | 1,231 | 1,236 | 1,500 |
| Liabilities\theld\tfor\tsale | — | — | — |
| Total\tcurrent\tliabilities | 7,622 | 9,113 | 10,287 |
| Long-term\tdebt | 30,887 | 31,269 | 28,465 |
| Deferred\tincome\ttaxes | 14,224 | 14,260 | 14,106 |
| Accrued\tpostemployment\tcosts | 394 | 394 | 400 |
| Other\tnon-current\tliabilities | 1,035 | 998 | 1,023 |
| TOTAL\tLIABILITIES | 54,162 | 56,034 | 54,281 |
| Commitments\tand\tContingencies |  |  |  |
| Redeemable\tnoncontrolling\tinterest | 6 | 7 | 8 |
| Equity: |  |  |  |
| at\tSeptember\t29,\t2018,\t1,222\tshares\tissued\tand\t1,219\tshares\toutstanding\tat\tJune\t30,\t2018,\tand\t1,222\tshares |  |  |  |
| issued\tand\t1,219\tshares\toutstanding\tat\tMarch\t31,\t2018) | 12 | 12 | 12 |
| Additional\tpaid-in\tcapital | 58,716 | 58,689 | 58,656 |
| Retained\tearnings/(deficit) | 8,479 | 8,624 | 8,634 |
| Accumulated\tother\tcomprehensive\tincome/(losses) | (1,724) | (1,551) | (975) |
| Treasury\tstock,\tat\tcost\t(3\tshares\tat\tSeptember\t29,\t2018,\t3\tshares\tat\tJune\t30,\t2018,\tand\t3\tshares\tat\tMarch\t31,\n2018) | (264) | (254) | (240) |
| Total\tshareholders'\tequity | 65,219 | 65,520 | 66,087 |
| Noncontrolling\tinterest | 188 | 188 | 207 |
| TOTAL\tEQUITY | 65,407 | 65,708 | 66,294 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $119,575 | $121,749 | $120,583 |

|  | September	30,<br>2017 | July	1,<br>2017 | April	1,<br>2017 |
| :--- | :--- | :--- | :--- |
| ASSETS |  |  |  |
| Cash\tand\tcash\tequivalents | $1,441 | $1,445 | $3,242 |
| Trade\treceivables\t(net\tof\tallowances\tof\t$29\tat\tSeptember\t30,\t2017,\t$28\tat\tJuly\t1,\t2017,\tand\t$30\tat\tApril\t1,\n2017) | 938 | 973 | 936 |
| Sold\treceivables | 427 | 461 | 538 |
| Income\ttaxes\treceivable | 290 | 237 | 269 |
| Inventories | 3,136 | 3,012 | 3,094 |
| Prepaid\texpenses | 368 | 359 | 349 |
| Other\tcurrent\tassets | 527 | 547 | 611 |
| Assets\theld\tfor\tsale | — | — | — |
| Total\tcurrent\tassets | 7,127 | 7,034 | 9,039 |
| Property,\tplant\tand\tequipment,\tnet | 6,902 | 6,804 | 6,689 |
| Goodwill | 44,859 | 44,566 | 44,301 |
| Intangible\tassets,\tnet | 59,483 | 59,383 | 59,313 |
| Other\tnon-current\tassets | 1,531 | 1,535 | 1,604 |
| TOTAL\tASSETS | $119,902 | $119,322 | $120,946 |
| LIABILITIES\tAND\tEQUITY |  |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $457 | $1,090 | $909 |
| Current\tportion\tof\tlong-term\tdebt | 2,747 | 19 | 2,022 |
| Trade\tpayables | 3,873 | 3,805 | 3,858 |
| Accrued\tmarketing | 500 | 499 | 601 |
| Interest\tpayable | 295 | 406 | 346 |
| Other\tcurrent\tliabilities | 1,578 | 1,589 | 1,905 |
| Liabilities\theld\tfor\tsale | — | — | — |
| Total\tcurrent\tliabilities | 9,450 | 7,408 | 9,641 |
| Long-term\tdebt | 28,276 | 29,978 | 29,747 |
| Deferred\tincome\ttaxes | 20,841 | 20,840 | 20,873 |
| Accrued\tpostemployment\tcosts | 1,808 | 1,975 | 2,016 |
| Other\tnon-current\tliabilities | 715 | 701 | 851 |
| TOTAL\tLIABILITIES | 61,090 | 60,902 | 63,128 |
| Commitments\tand\tContingencies |  |  |  |
| Redeemable\tnoncontrolling\tinterest | — | — | — |
| Equity: |  |  |  |
| at\tSeptember\t30,\t2017;\t1,221\tshares\tissued\tand\t1,218\tshares\toutstanding\tat\tJuly\t1,\t2017;\t1,220\tshares\tissued |  |  |  |
| and\t1,218\tshares\toutstanding\tat\tApril\t1,\t2017) | 12 | 12 | 12 |
| Additional\tpaid-in\tcapital | 58,618 | 58,597 | 58,565 |
| Retained\tearnings/(deficit) | 1,280 | 1,129 | 705 |
| Accumulated\tother\tcomprehensive\tincome/(losses) | (1,087) | (1,308) | (1,453) |
| Treasury\tstock,\tat\tcost\t(3\tshares\tat\tSeptember\t30,\t2017,\t3\tshares\tat\tJuly\t1,\t2017,\tand\t2\tshares\tat\tApril\t1,\n2017) | (223) | (223) | (223) |
| Total\tshareholders'\tequity | 58,600 | 58,207 | 57,606 |
| Noncontrolling\tinterest | 212 | 213 | 212 |
| TOTAL\tEQUITY | 58,812 | 58,420 | 57,818 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $119,902 | $119,322 | $120,946 |

# Condensed	Consolidated	Statements	of	Equity

|  |  |  | For	the	Nine	Months	Ended	September	29,	2018 | For	the	Nine	Months	Ended	September	29,	2018 | For	the	Nine	Months	Ended	September	29,	2018 |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Common\tStock | Additional\nPaid-in\nCapital | Retained\nEarnings/(Deficit) | Accumulated\tOther\nComprehensive\nIncome/(Losses) | Treasury\tStock,\nat\tCost | Noncontrolling\tInterest | Total\tEquity |
| Balance\tat\tDecember\t30,\t2017 | $12 | $58,634 | $8,495 | $(1,054) | $(224) | $207 | $66,070 |
| Net\tincome/(loss)\texcluding\tredeemable\tnoncontrolling\ninterest | — | — | 2,376 | — | — | 7 | 2,383 |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest | — | — | — | (670) | — | (13) | (683) |
| Dividends\tdeclared-common\tstock\t($1.875\tper\tshare) | — | — | (2,286) | — | — | — | (2,286) |
| Cumulative\teffect\tof\taccounting\tstandards\tadopted\tin\nthe\tperiod | — | — | (97) | — | — | — | (97) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\tstock\nawards,\tand\tother | — | 82 | (9) | — | (40) | (13) | 20 |
| Balance\tat\tSeptember\t29,\t2018 | $12 | $58,716 | $8,479 | $(1,724) | $(264) | $188 | $65,407 |
|  |  |  |  | As\tRestated |  |  |  |
|  |  |  |  | For\tthe\tSix\tMonths\tEnded\tJune\t30,\t2018 | For\tthe\tSix\tMonths\tEnded\tJune\t30,\t2018 |  |  |
|  |  | Additional |  | Accumulated\tOther |  |  |  |
|  |  | Paid-in | Retained | Comprehensive | Treasury\tStock, |  |  |

|  | Common	Stock | Capital | Earnings/(Deficit) | Income/(Losses) | at	Cost | Noncontrolling	Interest | Total	Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Balance\tat\tDecember\t30,\t2017 | $12 | $58,634 | $8,495 | $(1,054) | $(224) | $207 | $66,070 |
| Net\tincome/(loss)\texcluding\tredeemable\tnoncontrolling\ninterest | — | — | 1,757 | — | — | 5 | 1,762 |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest | — | — | — | (497) | — | (11) | (508) |
| Dividends\tdeclared-common\tstock\t($1.25\tper\tshare) | — | — | (1,524) | — | — | — | (1,524) |
| Cumulative\teffect\tof\taccounting\tstandards\tadopted\tin\nthe\tperiod | — | — | (95) | — | — | — | (95) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\tstock\nawards,\tand\tother | — | 55 | (9) | — | (30) | (13) | 3 |
| Balance\tat\tJune\t30,\t2018 | $12 | $58,689 | $8,624 | $(1,551) | $(254) | $188 | $65,708 |
|  |  |  |  | As\tRestated |  |  |  |
|  |  |  | For\tthe\tThree\tMonths\tEnded\tMarch\t31,\t2018 | For\tthe\tThree\tMonths\tEnded\tMarch\t31,\t2018 | For\tthe\tThree\tMonths\tEnded\tMarch\t31,\t2018 |  |  |
|  |  | Additional |  | Accumulated\tOther |  |  |  |
|  |  | Paid-in | Retained | Comprehensive | Treasury\tStock, |  |  |

|  | Common	Stock | Capital | Earnings/(Deficit) | Income/(Losses) | at	Cost | Noncontrolling	Interest | Total	Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| Balance\tat\tDecember\t30,\t2017 | $12 | $58,634 | $8,495 | $(1,054) | $(224) | $207 | $66,070 |
| Net\tincome/(loss)\texcluding\tredeemable\tnoncontrolling\ninterest | — | — | 1,003 | — | — | 5 | 1,008 |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest | — | — | — | 79 | — | (5) | 74 |
| Dividends\tdeclared-common\tstock\t($0.625\tper\tshare) | — | — | (762) | — | — | — | (762) |
| Cumulative\teffect\tof\taccounting\tstandards\tadopted\tin\nthe\tperiod | — | — | (95) | — | — | — | (95) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\tstock\nawards,\tand\tother | — | 22 | (7) | — | (16) | — | (1) |
| Balance\tat\tMarch\t31,\t2018 | $12 | $58,656 | $8,634 | $(975) | $(240) | $207 | $66,294 |

|  |  |  |  | For	the	Nine	Months	Ended	September	30,	2017 | For	the	Nine	Months	Ended	September	30,	2017 |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Common\tStock | Additional\nPaid-in\nCapital | Retained\nEarnings/(Deficit) | Accumulated\tOther\nComprehensive\nIncome/(Losses) | Treasury\tStock,\nat\tCost | Noncontrolling\tInterest | Total\tEquity |
| Balance\tat\tDecember\t31,\t2016 | $12 | $58,516 | $552 | $(1,629) | $(207) | $216 | $57,460 |
| Net\tincome/(loss) | — | — | 2,952 | — | — | (2) | 2,950 |
| Other\tcomprehensive\tincome/(loss) | — | — | — | 542 | — | (2) | 540 |
| Dividends\tdeclared-common\tstock\t($1.825\tper\tshare) | — | — | (2,225) | — | — | — | (2,225) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\tstock\nawards,\tand\tother | — | 102 | 1 | — | (16) | — | 87 |
| Balance\tat\tSeptember\t30,\t2017 | $12 | $58,618 | $1,280 | $(1,087) | $(223) | $212 | $58,812 |

|  |  |  |  | For	the	Six	Months	Ended	July	1,	2017 |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Common\tStock | Additional\nPaid-in\nCapital | Retained\nEarnings/(Deficit) | Accumulated\tOther\nComprehensive\nIncome/(Losses) | Treasury\tStock,\nat\tCost | Noncontrolling\tInterest | Total\tEquity |
| Balance\tat\tDecember\t31,\t2016 | $12 | $58,516 | $552 | $(1,629) | $(207) | $216 | $57,460 |
| Net\tincome/(loss) | — | — | 2,039 | — | — | (1) | 2,038 |
| Other\tcomprehensive\tincome/(loss) | — | — | — | 321 | — | (2) | 319 |
| Dividends\tdeclared-common\tstock\t($1.20\tper\tshare) | — | — | (1,463) | — | — | — | (1,463) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\tstock\nawards,\tand\tother | — | 81 | 1 | — | (16) | — | 66 |
| Balance\tat\tJuly\t1,\t2017 | $12 | $58,597 | $1,129 | $(1,308) | $(223) | $213 | $58,420 |

|  |  |  |  | For	the	Three	Months	Ended	April	1,	2017 |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Common\tStock | Additional\nPaid-in\nCapital | Retained\nEarnings/(Deficit) | Accumulated\tOther\nComprehensive\nIncome/(Losses) | Treasury\tStock,\nat\tCost | Noncontrolling\tInterest | Total\tEquity |
| Balance\tat\tDecember\t31,\t2016 | $12 | $58,516 | $552 | $(1,629) | $(207) | $216 | $57,460 |
| Net\tincome/(loss) | — | — | 883 | — | — | (2) | 881 |
| Other\tcomprehensive\tincome/(loss) | — | — | — | 176 | — | (2) | 174 |
| Dividends\tdeclared-common\tstock\t($0.60\tper\tshare) | — | — | (731) | — | — | — | (731) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\tstock\nawards,\tand\tother | — | 49 | 1 | — | (16) | — | 34 |
| Balance\tat\tApril\t1,\t2017 | $12 | $58,565 | $705 | $(1,453) | $(223) | $212 | $57,818 |

|  | September	29,	2018<br>Nine	Months	Ended | June	30,<br>2018<br>Six	Months	Ended | March	31,<br>2018<br>Three	Months	Ended |
| :--- | :--- | :--- | :--- |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES: |  |  |  |
| Net\tincome/(loss) | $2,374 | $1,756 | $1,003 |
| Adjustments\tto\treconcile\tnet\tincome/(loss)\tto\toperating\tcash\tflows: |  |  |  |
| Depreciation\tand\tamortization | 712 | 462 | 227 |
| Amortization\tof\tpostretirement\tbenefit\tplans\tprior\tservice\tcosts/(credits) | (261) | (183) | (106) |
| Equity\taward\tcompensation\texpense | 44 | 27 | 7 |
| Deferred\tincome\ttax\tprovision/(benefit) | 104 | 79 | (46) |
| Postemployment\tbenefit\tplan\tcontributions | (64) | (60) | (22) |
| Goodwill\tand\tintangible\tasset\timpairment\tlosses | 451 | 234 | — |
| Nonmonetary\tcurrency\tdevaluation | 131 | 67 | 47 |
| Other\titems,\tnet | 35 | 27 | (22) |
| Changes\tin\tcurrent\tassets\tand\tliabilities: |  |  |  |
| Trade\treceivables | (2,154) | (2,001) | (712) |
| Inventories | (645) | (428) | (312) |
| Accounts\tpayable | 130 | 127 | (85) |
| Other\tcurrent\tassets | (103) | (44) | 26 |
| Other\tcurrent\tliabilities | 124 | 153 | 403 |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | 878 | 216 | 408 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES: |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | 1,296 | 1,221 | 436 |
| Capital\texpenditures | (594) | (438) | (223) |
| Payments\tto\tacquire\tbusiness,\tnet\tof\tcash\tacquired | (248) | (215) | (215) |
| Other\tinvesting\tactivities,\tnet | 31 | 11 | 6 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 485 | 579 | 4 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES: |  |  |  |
| Repayments\tof\tlong-term\tdebt | (2,706) | (12) | (6) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | 2,990 | 2,990 | — |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | 2,485 | 1,525 | 1,524 |
| Repayments\tof\tcommercial\tpaper | (1,950) | (1,950) | (1,006) |
| Dividends\tpaid\t-\tSeries\tA\tPreferred\tStock | — | — | — |
| Dividends\tpaid\t-\tcommon\tstock | (2,421) | (1,659) | (897) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | — | — | — |
| Other\tfinancing\tactivities,\tnet | (35) | (3) | 14 |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (1,637) | 891 | (371) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\tcash | (128) | (80) | (10) |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash |  |  |  |
| Net\tincrease/(decrease) | (402) | 1,606 | 31 |
| Balance\tat\tbeginning\tof\tperiod | 1,769 | 1,769 | 1,769 |
| Balance\tat\tend\tof\tperiod | $1,367 | $3,375 | $1,800 |
| NON-CASH\tINVESTING\tACTIVITIES: |  |  |  |
| Beneficial\tinterest\tobtained\tin\texchange\tfor\tsecuritized\ttrade\treceivables | $938 | $899 | $613 |

|  | September	30,	2017<br>Nine	Months	Ended | July	1,<br>2017<br>Six	Months	Ended | April	1,<br>2017<br>Three	Months	Ended |
| :--- | :--- | :--- | :--- |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES: |  |  |  |
| Net\tincome/(loss) | $2,950 | $2,038 | $881 |
| Adjustments\tto\treconcile\tnet\tincome/(loss)\tto\toperating\tcash\tflows: |  |  |  |
| Depreciation\tand\tamortization | 789 | 517 | 262 |
| Amortization\tof\tpostretirement\tbenefit\tplans\tprior\tservice\tcosts/(credits) | (247) | (171) | (82) |
| Equity\taward\tcompensation\texpense | 36 | 24 | 11 |
| Deferred\tincome\ttax\tprovision/(benefit) | 432 | 223 | 68 |
| Postemployment\tbenefit\tplan\tcontributions | (283) | (90) | (38) |
| Goodwill\tand\tintangible\tasset\timpairment\tlosses | 49 | 48 | — |
| Nonmonetary\tcurrency\tdevaluation | 36 | 33 | 8 |
| Other\titems,\tnet | (62) | (48) | 40 |
| Changes\tin\tcurrent\tassets\tand\tliabilities: |  |  |  |
| Trade\treceivables | (2,061) | (1,598) | (1,040) |
| Inventories | (567) | (418) | (475) |
| Accounts\tpayable | 123 | 84 | 62 |
| Other\tcurrent\tassets | (90) | (103) | (72) |
| Other\tcurrent\tliabilities | (1,090) | (717) | (240) |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | 15 | (178) | (615) |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES: |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | 1,633 | 1,069 | 464 |
| Capital\texpenditures | (956) | (690) | (368) |
| Payments\tto\tacquire\tbusiness,\tnet\tof\tcash\tacquired | — | — | — |
| Other\tinvesting\tactivities,\tnet | 45 | 44 | 38 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 722 | 423 | 134 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES: |  |  |  |
| Repayments\tof\tlong-term\tdebt | (2,635) | (2,032) | (27) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | 1,496 | 4 | 2 |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | 5,495 | 4,213 | 2,324 |
| Repayments\tof\tcommercial\tpaper | (5,709) | (3,777) | (2,068) |
| Dividends\tpaid\t-\tSeries\tA\tPreferred\tStock | — | — | — |
| Dividends\tpaid\t-\tcommon\tstock | (2,161) | (1,434) | (736) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | — | — | — |
| Other\tfinancing\tactivities,\tnet | 28 | 15 | — |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (3,486) | (3,011) | (505) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\tcash | 43 | 29 | 13 |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash |  |  |  |
| Net\tincrease/(decrease) | (2,706) | (2,737) | (973) |
| Balance\tat\tbeginning\tof\tperiod | 4,255 | 4,255 | 4,255 |
| Balance\tat\tend\tof\tperiod | $1,549 | $1,518 | $3,282 |
| NON-CASH\tINVESTING\tACTIVITIES: |  |  |  |
| Beneficial\tinterest\tobtained\tin\texchange\tfor\tsecuritized\ttrade\treceivables | $1,936 | $1,407 | $880 |

# Condensed	Consolidated	Statement	of	Income

|  | For	the	Three	Months	Ended	September	29,	2018 | For	the	Three	Months	Ended	September	29,	2018 | For	the	Three	Months	Ended	September	29,	2018 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tsales | $6,378 | $5 | (g) | $6,383 |
| Cost\tof\tproducts\tsold | 4,271 | 18 | (a)(b)(g) | 4,289 |
| Gross\tprofit | 2,107 | (13) |  | 2,094 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\timpairment\tlosses | 803 | — | (g) | 803 |
| Goodwill\timpairment\tlosses | — | — |  | — |
| Intangible\tasset\timpairment\tlosses | 234 | (17) | (f) | 217 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 1,037 | (17) |  | 1,020 |
| Operating\tincome/(loss) | 1,070 | 4 |  | 1,074 |
| Interest\texpense | 327 | (1) | (b)(g) | 326 |
| Other\texpense/(income),\tnet | (71) | — |  | (71) |
| Income/(loss)\tbefore\tincome\ttaxes | 814 | 5 |  | 819 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | 186 | 15 | (a)(b)(e)(f)(g) | 201 |
| Net\tincome/(loss) | 628 | (10) |  | 618 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (2) | 1 | (g) | (1) |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 630 | (11) |  | 619 |
| Preferred\tdividends | — | — |  | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $630 | $(11) |  | $619 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |
| Basic\tearnings/(loss) | $0.52 | $(0.01) |  | $0.51 |
| Diluted\tearnings/(loss) | 0.51 | (0.01) |  | 0.50 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$13	million	and	a	decrease	to	provision	for	income	taxes of	$2	million	for	the	three	months	ended	September	29,	2018.

(b)	Capital	Leases—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	less	than	$1	million,	a	decrease	to	interest	expense	of	$1 million,	and	an	increase	to	provision	for	income	taxes	of	less	than	$1	million	for	the	three	months	ended	September	29,	2018.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	provision	for	income	taxes	of	$14	million	for	the	three	months	ended	September	29, 2018.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	SG&A	of	$17	million	and	an	increase	to	provision	for	income	taxes	of	$4	million	for	the three	months	ended	September	29,	2018.

(g)	Other—The	correction	of	these	misstatements	resulted	in	an	increase	to	net	sales	of	$5	million,	an	increase	to	cost	of	products	sold	of	$5	million,	an	increase	to SG&A	of	less	than	$1	million,	a	decrease	to	interest	expense	of	less	than	$1	million,	a	decrease	to	provision	for	income	taxes	of	$1	million,	and	a	decrease	to	net	loss attributable	to	noncontrolling	interest	of	$1	million	for	the	three	months	ended	September	29,	2018.

See	Note	2,	Restatement	of	Previously	Issued	Consolidated	Financial	Statements,	for	a	description	of	the	misstatements	in	each	category	of	restatements	referenced	by (a)	through	(g).

|  | Reported | Restatement	Impacts | Reference | As	Restated |
| :--- | :--- | :--- | :--- | :--- |
| Net\tsales | $19,368 | $9 | (g) | $19,377 |
| Cost\tof\tproducts\tsold | 12,651 | 21 | (a)(b)(g) | 12,672 |
| Gross\tprofit | 6,717 | (12) |  | 6,705 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\timpairment\tlosses | 2,338 | — | (g) | 2,338 |
| Goodwill\timpairment\tlosses | 164 | (31) | (f) | 133 |
| Intangible\tasset\timpairment\tlosses | 335 | (17) | (f) | 318 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 2,837 | (48) |  | 2,789 |
| Operating\tincome/(loss) | 3,880 | 36 |  | 3,916 |
| Interest\texpense | 962 | (3) | (b)(g) | 959 |
| Other\texpense/(income),\tnet | (196) | — |  | (196) |
| Income/(loss)\tbefore\tincome\ttaxes | 3,114 | 39 |  | 3,153 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | 738 | 41 | (a)(b)(e)(f)(g) | 779 |
| Net\tincome/(loss) | 2,376 | (2) |  | 2,374 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (3) | 1 | (g) | (2) |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 2,379 | (3) |  | 2,376 |
| Preferred\tdividends | — | — |  | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $2,379 | $(3) |  | $2,376 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |
| Basic\tearnings/(loss) | $1.95 | $— |  | $1.95 |
| Diluted\tearnings/(loss) | 1.94 | — |  | 1.94 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$22	million	and	a	decrease	to	provision	for	income	taxes of	$3	million	for	the	nine	months	ended	September	29,	2018.

(b)	Capital	Leases—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$1	million,	a	decrease	to	interest	expense	of	$3	million,	and an	increase	to	provision	for	income	taxes	of	less	than	$1	million	for	the	nine	months	ended	September	29,	2018.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	provision	for	income	taxes	of	$40	million	for	the	nine	months	ended	September	29, 2018.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	SG&A	of	$48	million	and	an	increase	to	provision	for	income	taxes	of	$4	million	for	the nine	months	ended	September	29,	2018.

(g)	Other—The	correction	of	these	misstatements	resulted	in	an	increase	to	net	sales	of	$9	million,	a	decrease	to	cost	of	products	sold	of	$2	million,	an	increase	to	SG&A of	less	than	$1	million,	a	decrease	to	interest	expense	of	less	than	$1	million,	an	increase	to	provision	for	income	taxes	of	less	than	$1	million,	and	a	decrease	to	net	loss attributable	to	noncontrolling	interest	of	$1	million	for	the	nine	months	ended	September	29,	2018.

|  | Reported | Restatement	Impacts | Reference | As	Restated |
| :--- | :--- | :--- | :--- | :--- |
| Net\tsales | $6,686 | $4 | (g) | $6,690 |
| Cost\tof\tproducts\tsold | 4,321 | 22 | (a)(b)(g) | 4,343 |
| Gross\tprofit | 2,365 | (18) |  | 2,347 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\timpairment\tlosses | 771 | — |  | 771 |
| Goodwill\timpairment\tlosses | 164 | (31) | (f) | 133 |
| Intangible\tasset\timpairment\tlosses | 101 | — |  | 101 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 1,036 | (31) |  | 1,005 |
| Operating\tincome/(loss) | 1,329 | 13 |  | 1,342 |
| Interest\texpense | 318 | (2) | (b)(g) | 316 |
| Other\texpense/(income),\tnet | (35) | — |  | (35) |
| Income/(loss)\tbefore\tincome\ttaxes | 1,046 | 15 |  | 1,061 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | 291 | 17 | (a)(b)(e)(f)(g) | 308 |
| Net\tincome/(loss) | 755 | (2) |  | 753 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (1) | — |  | (1) |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 756 | (2) |  | 754 |
| Preferred\tdividends | — | — |  | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $756 | $(2) |  | $754 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |
| Basic\tearnings/(loss) | $0.62 | $— |  | $0.62 |
| Diluted\tearnings/(loss) | 0.62 | — |  | 0.62 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$13	million	and	a	decrease	to	provision	for	income	taxes of	$2	million	for	the	three	months	ended	June	30,	2018.

(b)	Capital	Leases—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$1	million,	a	decrease	to	interest	expense	of	$2	million,	and an	increase	to	provision	for	income	taxes	of	less	than	$1	million	for	the	three	months	ended	June	30,	2018.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	provision	for	income	taxes	of	$21	million	for	the	three	months	ended	June	30,	2018.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	SG&A	of	$31	million	and	an	increase	to	provision	for	income	taxes	of	less	than	$1 million	for	the	three	months	ended	June	30,	2018.

(g)	Other—The	correction	of	these	misstatements	resulted	in	an	increase	to	net	sales	of	$4	million,	an	increase	to	cost	of	products	sold	of	$8	million,	a	decrease	to	interest expense	of	less	than	$1	million,	and	a	decrease	to	provision	for	income	taxes	of	$2	million	for	the	three	months	ended	June	30,	2018.

|  |  | For	the	Six	Months	Ended	June	30,	2018 | For	the	Six	Months	Ended	June	30,	2018 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tsales | $12,990 | $4 | (g) | $12,994 |
| Cost\tof\tproducts\tsold | 8,380 | 3 | (a)(b)(g) | 8,383 |
| Gross\tprofit | 4,610 | 1 |  | 4,611 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\timpairment\tlosses | 1,535 | — |  | 1,535 |
| Goodwill\timpairment\tlosses | 164 | (31) | (f) | 133 |
| Intangible\tasset\timpairment\tlosses | 101 | — |  | 101 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 1,800 | (31) |  | 1,769 |
| Operating\tincome/(loss) | 2,810 | 32 |  | 2,842 |
| Interest\texpense | 635 | (2) | (b)(g) | 633 |
| Other\texpense/(income),\tnet | (125) | — |  | (125) |
| Income/(loss)\tbefore\tincome\ttaxes | 2,300 | 34 |  | 2,334 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | 552 | 26 | (a)(b)(e)(f)(g) | 578 |
| Net\tincome/(loss) | 1,748 | 8 |  | 1,756 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (1) | — |  | (1) |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 1,749 | 8 |  | 1,757 |
| Preferred\tdividends | — | — |  | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $1,749 | $8 |  | $1,757 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |
| Basic\tearnings/(loss) | $1.43 | $0.01 |  | $1.44 |
| Diluted\tearnings/(loss) | 1.43 | — |  | 1.43 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$9	million	and	a	decrease	to	provision	for	income	taxes	of $1	million	for	the	six	months	ended	June	30,	2018.

(b)	Capital	Leases—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$1	million,	a	decrease	to	interest	expense	of	$2	million,	and an	increase	to	provision	for	income	taxes	of	less	than	$1	million	for	the	six	months	ended	June	30,	2018.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	provision	for	income	taxes	of	$26	million	for	the	six	months	ended	June	30,	2018.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	SG&A	of	$31	million	and	an	increase	to	provision	for	income	taxes	of	less	than	$1 million	for	the	six	months	ended	June	30,	2018.

(g)	Other—The	correction	of	these	misstatements	resulted	in	an	increase	to	net	sales	of	$4	million,	a	decrease	to	cost	of	products	sold	of	$7	million,	a	decrease	to	interest expense	of	less	than	$1	million,	and	an	increase	to	provision	for	income	taxes	of	$1	million	for	the	six	months	ended	June	30,	2018.

|  |  | For	the	Three	Months	Ended	March	31,	2018 | For	the	Three	Months	Ended	March	31,	2018 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tsales | $6,304 | $— |  | $6,304 |
| Cost\tof\tproducts\tsold | 4,059 | (19) | (a)(b)(g) | 4,040 |
| Gross\tprofit | 2,245 | 19 |  | 2,264 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\timpairment\tlosses | 764 | — |  | 764 |
| Goodwill\timpairment\tlosses | — | — |  | — |
| Intangible\tasset\timpairment\tlosses | — | — | (f) | — |
| Selling,\tgeneral\tand\tadministrative\texpenses | 764 | — |  | 764 |
| Operating\tincome/(loss) | 1,481 | 19 |  | 1,500 |
| Interest\texpense | 317 | — | (b)(g) | 317 |
| Other\texpense/(income),\tnet | (90) | — |  | (90) |
| Income/(loss)\tbefore\tincome\ttaxes | 1,254 | 19 |  | 1,273 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | 261 | 9 | (a)(b)(e)(f)(g) | 270 |
| Net\tincome/(loss) | 993 | 10 |  | 1,003 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | — | — |  | — |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 993 | 10 |  | 1,003 |
| Preferred\tdividends | — | — |  | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $993 | $10 |  | $1,003 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |
| Basic\tearnings/(loss) | $0.81 | $0.01 |  | $0.82 |
| Diluted\tearnings/(loss) | 0.81 | 0.01 |  | 0.82 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	a	decrease	to	cost	of	products	sold	of	$4	million	and	an	increase	to	provision	for	income	taxes	of $1	million	for	the	three	months	ended	March	31,	2018.

(b)	Capital	Leases—The	correction	of	these	misstatements	resulted	in	a	decrease	to	cost	of	products	sold	of	less	than	$1	million,	a	decrease	to	interest	expense	of	less than	$1	million,	and	an	increase	to	provision	for	income	taxes	of	less	than	$1	million	for	the	three	months	ended	March	31,	2018.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	provision	for	income	taxes	of	$5	million	for	the	three	months	ended	March	31,	2018.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	SG&A	of	less	than	$1	million	and	an	increase	to	provision	for	income	taxes	of	less	than $1	million	for	the	three	months	ended	March	31,	2018.

(g)	Other—The	correction	of	these	misstatements	resulted	in	a	decrease	to	cost	of	products	sold	of	$15	million,	a	decrease	to	interest	expense	of	less	than	$1	million,	and an	increase	to	provision	for	income	taxes	of	$3	million	for	the	three	months	ended	March	31,	2018.

|  |  | For	the	Three	Months	Ended	December	30,	2017 | For	the	Three	Months	Ended	December	30,	2017 | For	the	Three	Months	Ended	December	30,	2017 |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated | ASU\tAdoption\nImpacts | As\tRestated\t&amp;\nRecast |
| Net\tsales | $6,877 | $(36) | (c)(g) | $6,841 | $— | $6,841 |
| Cost\tof\tproducts\tsold | 4,470 | (18) | (a)(b)(c)(g) | 4,452 | 102 | 4,554 |
| Gross\tprofit | 2,407 | (18) |  | 2,389 | (102) | 2,287 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\nimpairment\tlosses | 767 | (4) | (c)(g) | 763 | 15 | 778 |
| Goodwill\timpairment\tlosses | — | — |  | — | — | — |
| Intangible\tasset\timpairment\tlosses | — | — | (f) | — | — | — |
| Selling,\tgeneral\tand\tadministrative\texpenses | 767 | (4) |  | 763 | 15 | 778 |
| Operating\tincome/(loss) | 1,640 | (14) |  | 1,626 | (117) | 1,509 |
| Interest\texpense | 308 | — | (g) | 308 | — | 308 |
| Other\texpense/(income),\tnet | 1 | — |  | 1 | (117) | (116) |
| Income/(loss)\tbefore\tincome\ttaxes | 1,331 | (14) |  | 1,317 | — | 1,317 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | (6,665) | — | (a)(b)(e)(f)(g) | (6,665) | — | (6,665) |
| Net\tincome/(loss) | 7,996 | (14) |  | 7,982 | — | 7,982 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (7) | — |  | (7) | — | (7) |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 8,003 | (14) |  | 7,989 | — | 7,989 |
| Preferred\tdividends | — | — |  | — | — | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $8,003 | $(14) |  | $7,989 | $— | $7,989 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |  |  |
| Basic\tearnings/(loss) | $6.57 | $(0.02) |  | $6.55 | $— | $6.55 |
| Diluted\tearnings/(loss) | 6.52 | (0.02) |  | 6.50 | — | 6.50 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$21	million	and	a	decrease	to	benefit	from	income	taxes	of $8	million	for	the	three	months	ended	December	30,	2017.

(b)	Capital	Leases—The	correction	of	these	misstatements	resulted	in	a	decrease	to	cost	of	products	sold	of	less	than	$1	million,	a	decrease	to	interest	expense	of	less than	$1	million,	and	a	decrease	to	benefit	from	income	taxes	of	less	than	$1	million	for	the	three	months	ended	December	30,	2017.

(c)	Customer	Incentive	Program	Expense	Misclassifications—As	previously	disclosed	in	March	2018,	the	correction	of	these	misstatements	resulted	in	a	decrease	to	net sales	of	$33	million,	a	decrease	to	cost	of	products	sold	of	$31	million,	and	a	decrease	to	SG&A	of	$2	million	for	the	three	months	ended	December	30,	2017.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	benefit	from	income	taxes	of	$12	million	for	the	three	months	ended	December	30, 2017.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	SG&A	of	less	than	$1	million	and	a	decrease	to	benefit	from	income	taxes	of	less	than $1	million	for	the	three	months	ended	December	30,	2017.

(g)	Other—The	correction	of	these	misstatements	resulted	in	a	decrease	to	net	sales	of	$3	million,	a	decrease	to	cost	of	products	sold	of	$8	million,	a	decrease	to	SG&A of	$2	million,	a	decrease	to	interest	expense	of	less	than	$1	million,	and	a	decrease	to	benefit	from	income	taxes	of	$4	million	for	the	three	months	ended	December	30, 2017.

The	values	as	previously	reported	for	the	three	months	ended	December	30,	2017	were	derived	from	our	Annual	Report	on	Form	10-K	for	the	year	ended	December	30, 2017	filed	on	February	16,	2018.

|  |  | For	the	Three	Months	Ended	September	30,	2017 | For	the	Three	Months	Ended	September	30,	2017 | For	the	Three	Months	Ended	September	30,	2017 |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated | ASU\tAdoption\nImpacts | As\tRestated\t&amp;\nRecast |
| Net\tsales | $6,314 | $(35) | (c)(g) | $6,279 | $— | $6,279 |
| Cost\tof\tproducts\tsold | 4,000 | 14 | (a)(c)(g) | 4,014 | 109 | 4,123 |
| Gross\tprofit | 2,314 | (49) |  | 2,265 | (109) | 2,156 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\nimpairment\tlosses | 652 | (2) | (c) | 650 | 14 | 664 |
| Goodwill\timpairment\tlosses | — | — |  | — | — | — |
| Intangible\tasset\timpairment\tlosses | 1 | — | (f) | 1 | — | 1 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 653 | (2) |  | 651 | 14 | 665 |
| Operating\tincome/(loss) | 1,661 | (47) |  | 1,614 | (123) | 1,491 |
| Interest\texpense | 306 | — | (g) | 306 | — | 306 |
| Other\texpense/(income),\tnet | (4) | — |  | (4) | (123) | (127) |
| Income/(loss)\tbefore\tincome\ttaxes | 1,359 | (47) |  | 1,312 | — | 1,312 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | 416 | (16) | (a)(e)(f)(g) | 400 | — | 400 |
| Net\tincome/(loss) | 943 | (31) |  | 912 | — | 912 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (1) | — |  | (1) | — | (1) |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 944 | (31) |  | 913 | — | 913 |
| Preferred\tdividends | — | — |  | — | — | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $944 | $(31) |  | $913 | $— | $913 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |  |  |
| Basic\tearnings/(loss) | $0.78 | $(0.03) |  | $0.75 | $— | $0.75 |
| Diluted\tearnings/(loss) | 0.77 | (0.03) |  | 0.74 | — | 0.74 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$36	million	and	a	decrease	to	provision	for	income	taxes of	$13	million	for	the	three	months	ended	September	30,	2017.

(c)	Customer	Incentive	Program	Expense	Misclassifications—As	previously	disclosed	in	March	2018,	the	correction	of	these	misstatements	resulted	in	a	decrease	to	net sales	of	$34	million,	a	decrease	to	cost	of	products	sold	of	$32	million,	and	a	decrease	to	SG&A	of	$2	million	for	the	three	months	ended	September	30,	2017.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	provision	for	income	taxes	of	less	than	$1	million	for	the	three	months	ended September	30,	2017.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	SG&A	of	less	than	$1	million	and	an	increase	to	provision	for	income	taxes	of	less	than $1	million	for	the	three	months	ended	September	30,	2017.

(g)	Other—The	correction	of	these	misstatements	resulted	in	a	decrease	to	net	sales	of	$1	million,	an	increase	to	cost	of	products	sold	of	$10	million,	a	decrease	to interest	expense	of	less	than	$1	million,	and	a	decrease	to	provision	for	income	taxes	of	$3	million	for	the	three	months	ended	September	30,	2017.

The	values	as	previously	reported	for	the	three	months	ended	September	30,	2017	were	derived	from	our	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended September	30,	2017	filed	on	November	7,	2017.

|  |  | For	the	Nine	Months	Ended	September	30,	2017 | For	the	Nine	Months	Ended	September	30,	2017 | For	the	Nine	Months	Ended	September	30,	2017 |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated | ASU\tAdoption\nImpacts | As\tRestated\t&amp;\nRecast |
| Net\tsales | $19,355 | $(120) | (c)(g) | $19,235 | $— | $19,235 |
| Cost\tof\tproducts\tsold | 12,059 | (26) | (a)(c)(g) | 12,033 | 456 | 12,489 |
| Gross\tprofit | 7,296 | (94) |  | 7,202 | (456) | 6,746 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\nimpairment\tlosses | 2,114 | (28) | (c)(g) | 2,086 | 63 | 2,149 |
| Goodwill\timpairment\tlosses | — | — |  | — | — | — |
| Intangible\tasset\timpairment\tlosses | 49 | — | (f) | 49 | — | 49 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 2,163 | (28) |  | 2,135 | 63 | 2,198 |
| Operating\tincome/(loss) | 5,133 | (66) |  | 5,067 | (519) | 4,548 |
| Interest\texpense | 926 | — | (g) | 926 | — | 926 |
| Other\texpense/(income),\tnet | 8 | — |  | 8 | (519) | (511) |
| Income/(loss)\tbefore\tincome\ttaxes | 4,199 | (66) |  | 4,133 | — | 4,133 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | 1,205 | (22) | (a)(e)(f)(g) | 1,183 | — | 1,183 |
| Net\tincome/(loss) | 2,994 | (44) |  | 2,950 | — | 2,950 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (2) | — |  | (2) | — | (2) |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 2,996 | (44) |  | 2,952 | — | 2,952 |
| Preferred\tdividends | — | — |  | — | — | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $2,996 | $(44) |  | $2,952 | $— | $2,952 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |  |  |
| Basic\tearnings/(loss) | $2.46 | $(0.04) |  | $2.42 | $— | $2.42 |
| Diluted\tearnings/(loss) | 2.44 | (0.04) |  | 2.40 | — | 2.40 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$72	million	and	a	decrease	to	provision	for	income	taxes of	$26	million	for	the	nine	months	ended	September	30,	2017.

(c)	Customer	Incentive	Program	Expense	Misclassifications—As	previously	disclosed	in	March	2018,	the	correction	of	these	misstatements	resulted	in	a	decrease	to	net sales	of	$114	million,	a	decrease	to	cost	of	products	sold	of	$108	million,	and	a	decrease	to	SG&A	of	$6	million	for	the	nine	months	ended	September	30,	2017.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	provision	for	income	taxes	of	less	than	$1	million	for	the	nine	months	ended September	30,	2017.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	SG&A	of	less	than	$1	million	and	an	increase	to	provision	for	income	taxes	of	less	than $1	million	for	the	nine	months	ended	September	30,	2017.

(g)	Other—The	correction	of	these	misstatements	resulted	in	a	decrease	to	net	sales	of	$6	million,	an	increase	to	cost	of	products	sold	of	$10	million,	a	decrease	to	SG&A of	$22	million,	a	decrease	to	interest	expense	of	less	than	$1	million,	and	an	increase	to	provision	for	income	taxes	of	$4	million	for	the	nine	months	ended	September 30,	2017.

The	values	as	previously	reported	for	the	nine	months	ended	September	30,	2017	were	derived	from	our	Quarterly	Report	on	Form	10-Q	for	the	quarter	ended	September 30,	2017	filed	on	November	7,	2017.

|  |  |  | For	the	Three	Months	Ended	July	1,	2017 | For	the	Three	Months	Ended	July	1,	2017 |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated | ASU\tAdoption\nImpacts | As\tRestated\t&amp;\nRecast |
| Net\tsales | $6,677 | $(43) | (c)(g) | $6,634 | $— | $6,634 |
| Cost\tof\tproducts\tsold | 3,996 | (15) | (a)(c)(g) | 3,981 | 246 | 4,227 |
| Gross\tprofit | 2,681 | (28) |  | 2,653 | (246) | 2,407 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\nimpairment\tlosses | 712 | (24) | (c)(g) | 688 | 32 | 720 |
| Goodwill\timpairment\tlosses | — | — |  | — | — | — |
| Intangible\tasset\timpairment\tlosses | 48 | — | (f) | 48 | — | 48 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 760 | (24) |  | 736 | 32 | 768 |
| Operating\tincome/(loss) | 1,921 | (4) |  | 1,917 | (278) | 1,639 |
| Interest\texpense | 307 | — | (g) | 307 | — | 307 |
| Other\texpense/(income),\tnet | 24 | — |  | 24 | (278) | (254) |
| Income/(loss)\tbefore\tincome\ttaxes | 1,590 | (4) |  | 1,586 | — | 1,586 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | 430 | (1) | (a)(e)(f)(g) | 429 | — | 429 |
| Net\tincome/(loss) | 1,160 | (3) |  | 1,157 | — | 1,157 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | 1 | — |  | 1 | — | 1 |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 1,159 | (3) |  | 1,156 | — | 1,156 |
| Preferred\tdividends | — | — |  | — | — | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $1,159 | $(3) |  | $1,156 | $— | $1,156 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |  |  |
| Basic\tearnings/(loss) | $0.95 | $— |  | $0.95 | $— | $0.95 |
| Diluted\tearnings/(loss) | 0.94 | — |  | 0.94 | — | 0.94 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$23	million	and	a	decrease	to	provision	for	income	taxes of	$8	million	for	the	three	months	ended	July	1,	2017.

(c)	Customer	Incentive	Program	Expense	Misclassifications—As	previously	disclosed	in	March	2018,	the	correction	of	these	misstatements	resulted	in	a	decrease	to	net sales	of	$40	million,	a	decrease	to	cost	of	products	sold	of	$38	million,	and	a	decrease	to	SG&A	of	$2	million	for	the	three	months	ended	July	1,	2017.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	a	decrease	to	provision	for	income	taxes	of	less	than	$1	million	for	the	three	months	ended	July	1, 2017.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	SG&A	of	less	than	$1	million	and	an	increase	to	provision	for	income	taxes	of	less	than $1	million	for	the	three	months	ended	July	1,	2017.

(g)	Other—The	correction	of	these	misstatements	resulted	in	a	decrease	to	net	sales	of	$3	million,	an	increase	to	cost	of	products	sold	of	less	than	$1	million,	a	decrease to	SG&A	of	$22	million,	a	decrease	to	interest	expense	of	less	than	$1	million,	and	an	increase	to	provision	for	income	taxes	of	$7	million	for	the	three	months	ended July	1,	2017.

The	values	as	previously	reported	for	the	three	months	ended	July	1,	2017	were	derived	from	our	Quarterly	Report	on	Form	10-Q/A	for	the	quarter	ended	July	1,	2017 filed	on	November	7,	2017.

|  |  |  | For	the	Six	Months	Ended	July	1,	2017 | For	the	Six	Months	Ended	July	1,	2017 |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated | ASU\tAdoption\nImpacts | As\tRestated\t&amp;\nRecast |
| Net\tsales | $13,041 | $(85) | (c)(g) | $12,956 | $— | $12,956 |
| Cost\tof\tproducts\tsold | 8,059 | (40) | (a)(c)(g) | 8,019 | 347 | 8,366 |
| Gross\tprofit | 4,982 | (45) |  | 4,937 | (347) | 4,590 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\nimpairment\tlosses | 1,462 | (26) | (c)(g) | 1,436 | 49 | 1,485 |
| Goodwill\timpairment\tlosses | — | — |  | — | — | — |
| Intangible\tasset\timpairment\tlosses | 48 | — | (f) | 48 | — | 48 |
| Selling,\tgeneral\tand\tadministrative\texpenses | 1,510 | (26) |  | 1,484 | 49 | 1,533 |
| Operating\tincome/(loss) | 3,472 | (19) |  | 3,453 | (396) | 3,057 |
| Interest\texpense | 620 | — | (g) | 620 | — | 620 |
| Other\texpense/(income),\tnet | 12 | — |  | 12 | (396) | (384) |
| Income/(loss)\tbefore\tincome\ttaxes | 2,840 | (19) |  | 2,821 | — | 2,821 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | 789 | (6) | (a)(e)(f)(g) | 783 | — | 783 |
| Net\tincome/(loss) | 2,051 | (13) |  | 2,038 | — | 2,038 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (1) | — |  | (1) | — | (1) |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 2,052 | (13) |  | 2,039 | — | 2,039 |
| Preferred\tdividends | — | — |  | — | — | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $2,052 | $(13) |  | $2,039 | $— | $2,039 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |  |  |
| Basic\tearnings/(loss) | $1.69 | $(0.02) |  | $1.67 | $— | $1.67 |
| Diluted\tearnings/(loss) | 1.67 | (0.01) |  | 1.66 | — | 1.66 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$36	million	and	a	decrease	to	provision	for	income	taxes of	$13	million	for	the	six	months	ended	July	1,	2017.

(c)	Customer	Incentive	Program	Expense	Misclassifications—As	previously	disclosed	in	March	2018,	the	correction	of	these	misstatements	resulted	in	a	decrease	to	net sales	of	$80	million,	a	decrease	to	cost	of	products	sold	of	$76	million,	and	a	decrease	to	SG&A	of	$4	million	for	the	six	months	ended	July	1,	2017.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	provision	for	income	taxes	of	less	than	$1	million	for	the	six	months	ended	July	1, 2017.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	SG&A	of	less	than	$1	million	and	an	increase	to	provision	for	income	taxes	of	less	than $1	million	for	the	six	months	ended	July	1,	2017.

(g)	Other—The	correction	of	these	misstatements	resulted	in	a	decrease	to	net	sales	of	$5	million,	an	increase	to	cost	of	products	sold	of	less	than	$1	million,	a	decrease to	SG&A	of	$22	million,	a	decrease	to	interest	expense	of	less	than	$1	million,	and	an	increase	to	provision	for	income	taxes	of	$7	million	for	the	six	months	ended	July 1,	2017.

The	values	as	previously	reported	for	the	six	months	ended	July	1,	2017	were	derived	from	our	Quarterly	Report	on	Form	10-Q/A	for	the	quarter	ended	July	1,	2017	filed on	November	7,	2017.

|  |  |  | For	the	Three	Months	Ended	April	1,	2017 | For	the	Three	Months	Ended	April	1,	2017 |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated | ASU\tAdoption\nImpacts | As\tRestated\t&amp;\nRecast |
| Net\tsales | $6,364 | $(42) | (c)(g) | $6,322 | $— | $6,322 |
| Cost\tof\tproducts\tsold | 4,063 | (25) | (a)(c)(g) | 4,038 | 101 | 4,139 |
| Gross\tprofit | 2,301 | (17) |  | 2,284 | (101) | 2,183 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\nimpairment\tlosses | 750 | (2) | (c) | 748 | 17 | 765 |
| Goodwill\timpairment\tlosses | — | — |  | — | — | — |
| Intangible\tasset\timpairment\tlosses | — | — | (f) | — | — | — |
| Selling,\tgeneral\tand\tadministrative\texpenses | 750 | (2) |  | 748 | 17 | 765 |
| Operating\tincome/(loss) | 1,551 | (15) |  | 1,536 | (118) | 1,418 |
| Interest\texpense | 313 | — | (g) | 313 | — | 313 |
| Other\texpense/(income),\tnet | (12) | — |  | (12) | (118) | (130) |
| Income/(loss)\tbefore\tincome\ttaxes | 1,250 | (15) |  | 1,235 | — | 1,235 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | 359 | (5) | (a)(e)(f)(g) | 354 | — | 354 |
| Net\tincome/(loss) | 891 | (10) |  | 881 | — | 881 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (2) | — |  | (2) | — | (2) |
| Net\tincome/(loss)\tattributable\tto\tKraft\tHeinz | 893 | (10) |  | 883 | — | 883 |
| Preferred\tdividends | — | — |  | — | — | — |
| Net\tincome/(loss)\tattributable\tto\tcommon\tshareholders | $893 | $(10) |  | $883 | $— | $883 |
| Per\tshare\tdata\tapplicable\tto\tcommon\tshareholders: |  |  |  |  |  |  |
| Basic\tearnings/(loss) | $0.73 | $— |  | $0.73 | $— | $0.73 |
| Diluted\tearnings/(loss) | 0.73 | (0.01) |  | 0.72 | — | 0.72 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	cost	of	products	sold	of	$13	million	and	a	decrease	to	provision	for	income	taxes of	$5	million	for	the	three	months	ended	April	1,	2017.

(c)	Customer	Incentive	Program	Expense	Misclassifications—As	previously	disclosed	in	March	2018,	the	correction	of	these	misstatements	resulted	in	a	decrease	to	net sales	of	$40	million,	a	decrease	to	cost	of	products	sold	of	$38	million,	and	a	decrease	to	SG&A	of	$2	million	for	the	three	months	ended	April	1,	2017.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	provision	for	income	taxes	of	less	than	$1	million	for	the	three	months	ended	April	1, 2017.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	SG&A	of	less	than	$1	million	and	an	increase	to	provision	for	income	taxes	of	less	than $1	million	for	the	three	months	ended	April	1,	2017.

(g)	Other—The	correction	of	these	misstatements	resulted	in	a	decrease	to	net	sales	of	$2	million,	an	increase	to	cost	of	products	sold	of	less	than	$1	million,	a	decrease to	interest	expense	of	less	than	$1	million,	and	a	decrease	to	provision	for	income	taxes	of	less	than	$1	million	for	the	three	months	ended	April	1,	2017.

The	values	as	previously	reported	for	the	three	months	ended	April	1,	2017	were	derived	from	our	Quarterly	Report	on	Form	10-Q/A	for	the	quarter	ended	April	1,	2017 filed	on	November	7,	2017.

# Condensed	Consolidated	Statement	of	Comprehensive	Income

|  |  | For	the	Three	Months	Ended	September	29,	2018 | For	the	Three	Months	Ended	September	29,	2018 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $628 | $(10) | (a)(b)(e)(f)(g) | $618 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | (146) | 2 | (b)(e)(f) | (144) |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | 13 | — |  | 13 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | 3 | — |  | 3 |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | (2) | — |  | (2) |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | (16) | — |  | (16) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | 12 | — |  | 12 |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | 17 | — |  | 17 |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | — | — |  | — |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (58) | — |  | (58) |
| Total\tother\tcomprehensive\tincome/(loss) | (177) | 2 |  | (175) |
| Total\tcomprehensive\tincome/(loss) | 451 | (8) |  | 443 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (4) | 1 | (g) | (3) |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $455 | $(9) |  | $446 |

The	$10	million	decrease	to	net	income	was	primarily	driven	by	misstatements	in	the	income	taxes	and	supplier	rebates	categories,	partially	offset	by	misstatements	in the	impairments,	capital	leases,	and	other	categories.	See	additional	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	three	months ended	September	29,	2018	section	above.

The	$2	million	increase	to	foreign	currency	translation	adjustments	is	the	result	of	misstatements	in	the	income	taxes,	capital	leases,	and	impairments	categories.

|  |  | For	the	Nine	Months	Ended	September	29,	2018 | For	the	Nine	Months	Ended	September	29,	2018 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\tImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $2,376 | $(2) | (a)(b)(e)(f)(g) | $2,374 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | (817) | 8 | (b)(e)(f) | (809) |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | 158 | — |  | 158 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | 3 | — |  | 3 |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | (2) | — |  | (2) |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | 40 | — |  | 40 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | (10) | — |  | (10) |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | 70 | — |  | 70 |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | — | — |  | — |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (133) | — |  | (133) |
| Total\tother\tcomprehensive\tincome/(loss) | (691) | 8 |  | (683) |
| Total\tcomprehensive\tincome/(loss) | 1,685 | 6 |  | 1,691 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (16) | 1 | (g) | (15) |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $1,701 | $5 |  | $1,706 |

The	$2	million	decrease	to	net	income	was	primarily	driven	by	misstatements	in	the	income	taxes	and	supplier	rebates	categories,	partially	offset	by	misstatements	in	the impairments,	other,	and	capital	leases	categories.	See	additional	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	nine	months ended	September	29,	2018	section	above.

|  |  | For	the	Three	Months	Ended	June	30,	2018 | For	the	Three	Months	Ended	June	30,	2018 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\tImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $755 | $(2) | (a)(b)(e)(f)(g) | $753 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | (868) | 6 | (b)(e)(f) | (862) |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | 219 | — |  | 219 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | — | — |  | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | 34 | — |  | 34 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | (9) | — |  | (9) |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | 53 | — |  | 53 |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | — | — |  | — |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (17) | — |  | (17) |
| Total\tother\tcomprehensive\tincome/(loss) | (588) | 6 |  | (582) |
| Total\tcomprehensive\tincome/(loss) | 167 | 4 |  | 171 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (7) | — |  | (7) |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $174 | $4 |  | $178 |

The	$2	million	decrease	to	net	income	was	primarily	driven	by	misstatements	in	the	income	taxes,	supplier	rebates,	and	other	categories,	partially	offset	by	misstatements in	the	impairments	and	capital	leases	categories.	See	additional	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	three	months	ended June	30,	2018	section	above.

|  |  | For	the	Six	Months	Ended	June	30,	2018 | For	the	Six	Months	Ended	June	30,	2018 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $1,748 | $8 | (a)(b)(e)(f)(g) | $1,756 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | (671) | 6 | (b)(e)(f) | (665) |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | 145 | — |  | 145 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | — | — |  | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | 56 | — |  | 56 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | (22) | — |  | (22) |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | 53 | — |  | 53 |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | — | — |  | — |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (75) | — |  | (75) |
| Total\tother\tcomprehensive\tincome/(loss) | (514) | 6 |  | (508) |
| Total\tcomprehensive\tincome/(loss) | 1,234 | 14 |  | 1,248 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (12) | — |  | (12) |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $1,246 | $14 |  | $1,260 |

The	$8	million	increase	to	net	income	was	primarily	driven	by	misstatements	in	the	impairments,	other,	and	capital	leases	categories,	partially	offset	by	misstatements	in the	income	taxes	and	supplier	rebates	categories.	See	additional	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	six	months	ended June	30,	2018	section	above.

|  |  | For	the	Three	Months	Ended	March	31,	2018 | For	the	Three	Months	Ended	March	31,	2018 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $993 | $10 | (a)(b)(e)(f)(g) | $1,003 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | 197 | — | (b)(e) | 197 |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | (74) | — |  | (74) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | — | — |  | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | 22 | — |  | 22 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | (13) | — |  | (13) |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | — | — |  | — |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | — | — |  | — |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (58) | — |  | (58) |
| Total\tother\tcomprehensive\tincome/(loss) | 74 | — |  | 74 |
| Total\tcomprehensive\tincome/(loss) | 1,067 | 10 |  | 1,077 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (5) | — |  | (5) |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $1,072 | $10 |  | $1,082 |

The	$10	million	increase	to	net	income	was	primarily	driven	by	misstatements	in	the	other,	supplier	rebates,	capital	leases,	and	impairments	categories,	partially	offset	by misstatements	in	the	income	taxes	category.	See	additional	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	three	months	ended March	31,	2018	section	above.

The	less	than	$1	million	decrease	to	foreign	currency	translation	adjustments	is	the	result	of	misstatements	in	the	income	taxes	and	capital	leases	categories.

|  |  | For	the	Three	Months	Ended	December	30,	2017 | For	the	Three	Months	Ended	December	30,	2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $7,996 | $(14) | (a)(b)(e)(f)(g) | $7,982 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | 5 | 2 | (b)(e) | 7 |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | (26) | — |  | (26) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | — | — |  | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | 23 | — |  | 23 |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | (12) | — |  | (12) |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | 82 | — |  | 82 |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | 16 | — |  | 16 |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (49) | — |  | (49) |
| Total\tother\tcomprehensive\tincome/(loss) | 39 | 2 |  | 41 |
| Total\tcomprehensive\tincome/(loss) | 8,035 | (12) |  | 8,023 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | 1 | — |  | 1 |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $8,034 | $(12) |  | $8,022 |

The	$14	million	decrease	to	net	income	was	primarily	driven	by	misstatements	in	the	supplier	rebates	category,	partially	offset	by	misstatements	in	the	income	taxes, other,	capital	leases,	and	impairments	categories.	See	additional	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	three	months ended	December	30,	2017	section	above.

The	$2	million	decrease	to	foreign	currency	translation	adjustments	is	the	result	of	misstatements	in	the	income	taxes	and	capital	leases	categories.

|  | For	the	Three	Months	Ended	September	30,	2017 | For	the	Three	Months	Ended	September	30,	2017 | For	the	Three	Months	Ended	September	30,	2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $943 | $(31) | (a)(e)(f)(g) | $912 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | 421 | (2) | (e) | 419 |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | (124) | — |  | (124) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | — | — |  | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | (70) | — |  | (70) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | 51 | — |  | 51 |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | (4) | — |  | (4) |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | — | — |  | — |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (51) | — |  | (51) |
| Total\tother\tcomprehensive\tincome/(loss) | 223 | (2) |  | 221 |
| Total\tcomprehensive\tincome/(loss) | 1,166 | (33) |  | 1,133 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (1) | — |  | (1) |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $1,167 | $(33) |  | $1,134 |

The	$31	 million	 decrease	 to	 net	 income	 was	 primarily	 driven	 by	 misstatements	 in	 the	 supplier	 rebates,	 other,	 and	 income	 taxes	 categories,	 partially	 offset	 by misstatements	in	the	impairments	category.	See	additional	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	three	months	ended September	30,	2017	section	above.

The	$2	million	decrease	to	foreign	currency	translation	adjustments	is	the	result	of	misstatements	in	the	income	taxes	category.

|  |  | For	the	Nine	Months	Ended	September	30,	2017 | For	the	Nine	Months	Ended	September	30,	2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $2,994 | $(44) | (a)(e)(f)(g) | $2,950 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | 1,179 | (1) | (e) | 1,178 |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | (327) | — |  | (327) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | — | — |  | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | (136) | — |  | (136) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | 97 | — |  | 97 |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | (13) | — |  | (13) |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | 1 | — |  | 1 |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (260) | — |  | (260) |
| Total\tother\tcomprehensive\tincome/(loss) | 541 | (1) |  | 540 |
| Total\tcomprehensive\tincome/(loss) | 3,535 | (45) |  | 3,490 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (4) | — |  | (4) |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $3,539 | $(45) |  | $3,494 |

The	$44	million	decrease	to	net	income	was	primarily	driven	by	misstatements	in	the	supplier	rebates	and	income	taxes	categories,	partially	offset	by	misstatements	in the	other	and	 impairments	categories.	See	additional	descriptions	of	 the	net	 income	 impacts	 in	 the	consolidated	statement	of	 income	for	 the	nine	months	ended September	30,	2017	section	above.

|  |  | For	the	Three	Months	Ended	July	1,	2017 | For	the	Three	Months	Ended	July	1,	2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\tImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $1,160 | $(3) | (a)(e)(f)(g) | $1,157 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | 451 | 4 | (e) | 455 |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | (152) | — |  | (152) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | — | — |  | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | (32) | — |  | (32) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | 26 | — |  | 26 |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | 1 | — |  | 1 |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | 1 | — |  | 1 |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (154) | — |  | (154) |
| Total\tother\tcomprehensive\tincome/(loss) | 141 | 4 |  | 145 |
| Total\tcomprehensive\tincome/(loss) | 1,301 | 1 |  | 1,302 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | 1 | — |  | 1 |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $1,300 | $1 |  | $1,301 |

The	$3	million	decrease	to	net	income	was	primarily	driven	by	misstatements	in	the	supplier	rebates	category,	partially	offset	by	misstatements	in	the	other,	income taxes,	and	impairments	categories.	See	additional	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	three	months	ended	July	1,	2017 section	above.

The	$4	million	increase	to	foreign	currency	translation	adjustments	is	the	result	of	misstatements	in	the	income	taxes	category.

|  |  | For	the	Six	Months	Ended	July	1,	2017 | For	the	Six	Months	Ended	July	1,	2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $2,051 | $(13) | (a)(e)(f)(g) | $2,038 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | 758 | 1 | (e) | 759 |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | (203) | — |  | (203) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | — | — |  | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | (66) | — |  | (66) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | 46 | — |  | 46 |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | (9) | — |  | (9) |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | 1 | — |  | 1 |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (209) | — |  | (209) |
| Total\tother\tcomprehensive\tincome/(loss) | 318 | 1 |  | 319 |
| Total\tcomprehensive\tincome/(loss) | 2,369 | (12) |  | 2,357 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (3) | — |  | (3) |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $2,372 | $(12) |  | $2,360 |

The	$13	million	decrease	to	net	income	was	primarily	driven	by	misstatements	in	the	supplier	rebates	and	income	taxes	categories,	partially	offset	by	misstatements	in the	other	and	impairments	categories.	See	additional	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	three	months	ended	July	1, 2017	section	above.

|  |  | For	the	Three	Months	Ended	April	1,	2017 | For	the	Three	Months	Ended	April	1,	2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| Net\tincome/(loss) | $891 | $(10) | (a)(e)(f)(g) | $881 |
| Other\tcomprehensive\tincome/(loss),\tnet\tof\ttax: |  |  |  |  |
| Foreign\tcurrency\ttranslation\tadjustments | 307 | (3) | (e) | 304 |
| Net\tdeferred\tgains/(losses)\ton\tnet\tinvestment\thedges | (51) | — |  | (51) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tnet\tinvestment\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tnet\tinvestment\thedges\treclassified\tto\tnet\tincome/(loss) | — | — |  | — |
| Net\tdeferred\tgains/(losses)\ton\tcash\tflow\thedges | (34) | — |  | (34) |
| Amounts\texcluded\tfrom\tthe\teffectiveness\tassessment\tof\tcash\tflow\thedges | — | — |  | — |
| Net\tdeferred\tlosses/(gains)\ton\tcash\tflow\thedges\treclassified\tto\tnet\tincome/(loss) | 20 | — |  | 20 |
| Net\tactuarial\tgains/(losses)\tarising\tduring\tthe\tperiod | (10) | — |  | (10) |
| Prior\tservice\tcredits/(costs)\tarising\tduring\tthe\tperiod | — | — |  | — |
| Net\tpostemployment\tbenefit\tlosses/(gains)\treclassified\tto\tnet\tincome/(loss) | (55) | — |  | (55) |
| Total\tother\tcomprehensive\tincome/(loss) | 177 | (3) |  | 174 |
| Total\tcomprehensive\tincome/(loss) | 1,068 | (13) |  | 1,055 |
| Comprehensive\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | (4) | — |  | (4) |
| Comprehensive\tincome/(loss)\tattributable\tto\tKraft\tHeinz | $1,072 | $(13) |  | $1,059 |

The	$10	 million	 decrease	 to	 net	 income	 was	 primarily	 driven	 by	 misstatements	 in	 the	 supplier	 rebates,	 other,	 and	 income	 taxes	 categories,	 partially	 offset	 by misstatements	in	the	impairments	category.	See	additional	descriptions	of	the	net	income	impacts	in	the	consolidated	statement	of	income	for	the	three	months	ended April	1,	2017	section	above.

# Condensed	Consolidated	Balance	Sheet

|  | As	Previously<br>Reported | September	29,	2018<br>Restatement<br>Impacts | Restatement<br>Reference | As	Restated |
| :--- | :--- | :--- | :--- | :--- |
| ASSETS |  |  |  |  |
| Cash\tand\tcash\tequivalents | $1,366 | $— |  | $1,366 |
| Trade\treceivables\t(net\tof\tallowances\tof\t$24\tat\tSeptember\t29,\t2018) | 2,032 | — |  | 2,032 |
| Sold\treceivables | — | — |  | — |
| Income\ttaxes\treceivable | 195 | 8 | (a)(b)(e)(g) | 203 |
| Inventories | 3,287 | (73) | (d)(g) | 3,214 |
| Prepaid\texpenses | 389 | — |  | 389 |
| Other\tcurrent\tassets | 321 | 31 | (a)(d) | 352 |
| Assets\theld\tfor\tsale | — | — |  | — |
| Total\tcurrent\tassets | 7,590 | (34) |  | 7,556 |
| Property,\tplant\tand\tequipment,\tnet | 7,216 | (142) | (b)(g) | 7,074 |
| Goodwill | 44,308 | 31 | (f)(g) | 44,339 |
| Intangible\tassets,\tnet | 58,727 | — |  | 58,727 |
| Other\tnon-current\tassets | 1,889 | (10) | (e) | 1,879 |
| TOTAL\tASSETS | $119,730 | $(155) |  | $119,575 |
| LIABILITIES\tAND\tEQUITY |  |  |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $973 | $— |  | $973 |
| Current\tportion\tof\tlong-term\tdebt | 405 | (34) | (b)(g) | 371 |
| Trade\tpayables | 4,312 | (74) | (g) | 4,238 |
| Accrued\tmarketing | 494 | — |  | 494 |
| Interest\tpayable | 315 | — |  | 315 |
| Other\tcurrent\tliabilities | 1,082 | 149 | (a)(g) | 1,231 |
| Liabilities\theld\tfor\tsale | — | — |  | — |
| Total\tcurrent\tliabilities | 7,581 | 41 |  | 7,622 |
| Long-term\tdebt | 30,998 | (111) | (b)(g) | 30,887 |
| Deferred\tincome\ttaxes | 14,215 | 9 | (a)(e)(g) | 14,224 |
| Accrued\tpostemployment\tcosts | 394 | — |  | 394 |
| Other\tnon-current\tliabilities | 964 | 71 | (a) | 1,035 |
| TOTAL\tLIABILITIES | 54,152 | 10 |  | 54,162 |
| Commitments\tand\tContingencies |  |  |  |  |
| Redeemable\tnoncontrolling\tinterest | 6 | — |  | 6 |
| Equity: |  |  |  |  |
| outstanding\tat\tSeptember\t29,\t2018) | 12 | — |  | 12 |
| Additional\tpaid-in\tcapital | 58,793 | (77) | (d) | 58,716 |
| Retained\tearnings/(deficit) | 8,576 | (97) | (a)(b)(d)(e)(f)(g) | 8,479 |
| Accumulated\tother\tcomprehensive\tincome/(losses) | (1,732) | 8 | (b)(e)(f) | (1,724) |
| Treasury\tstock,\tat\tcost\t(3\tshares\tat\tSeptember\t29,\t2018) | (264) | — |  | (264) |
| Total\tshareholders'\tequity | 65,385 | (166) |  | 65,219 |
| Noncontrolling\tinterest | 187 | 1 | (g) | 188 |
| TOTAL\tEQUITY | 65,572 | (165) |  | 65,407 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $119,730 | $(155) |  | $119,575 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	$1	million,	a	decrease	to	other	current	assets	of	$36 million,	an	increase	to	other	current	liabilities	of	$66	million,	a	decrease	to	deferred	income	taxes	of	$40	million,	an	increase	to	other	non-current	liabilities	of	$71 million,	and	a	decrease	to	retained	earnings	of	$132	million	at	September	29,	2018.

(b)	Capital	Leases—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	less	than	$1	million,	a	decrease	to	property,	plant	and equipment,	net,	of	$141	million,	a	decrease	to	current	portion	of	long-term	debt	of	$32	million,	a	decrease	to	long-term	debt	of	$111	million,	an	increase	to	retained earnings	of	$2	million,	and	a	decrease	to	accumulated	other	comprehensive	losses	of	less	than	$1	million	at	September	29,	2018.

(d)	Balance	Sheet	Misclassifications—The	correction	of	these	misstatements	resulted	in	a	decrease	to	inventories	of	$67	million,	an	increase	to	other	current	assets	of $67	million,	a	decrease	to	additional	paid-in	capital	of	$77	million,	and	an	increase	to	retained	earnings	of	$77	million	at	September	29,	2018.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	$3	million,	a	decrease	to	other	non-current	assets	of	$10 million,	an	increase	to	deferred	income	taxes	of	$50	million,	a	decrease	to	retained	earnings	of	$66	million,	and	a	decrease	to	accumulated	other	comprehensive	losses	of $9	million	at	September	29,	2018.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	an	increase	to	goodwill	of	$30	million,	an increase to	retained	earnings	of	$31	million,	and	an increase	to	accumulated	other	comprehensive	losses	of	$1	million	at	September	29,	2018.

(g)	Other—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	$4	million,	a	decrease	to	inventories	of	$6	million,	a	decrease	to property,	plant	and	equipment,	net,	of	$1	million,	an	increase	to	goodwill	of	$1	million,	a	decrease	to	current	portion	of	long-term	debt	of	$2	million,	a	decrease	to	trade payables	of	$74	million,	an	increase	to	other	current	liabilities	of	$83	million,	an	increase	to	long-term	debt	of	less	than	$1	million,	a	decrease	to	deferred	income	taxes of	$1	million,	a	decrease	to	retained	earnings	of	$9	million,	and	an	increase	to	noncontrolling	interest	of	$1	million	at	September	29,	2018.

|  | As	Previously<br>Reported | June	30,	2018<br>Restatement<br>Impacts | Restatement<br>Reference | As	Restated |
| :--- | :--- | :--- | :--- | :--- |
| ASSETS |  |  |  |  |
| Cash\tand\tcash\tequivalents | $3,369 | $— |  | $3,369 |
| Trade\treceivables\t(net\tof\tallowances\tof\t$24\tat\tJune\t30,\t2018) | 1,950 | — |  | 1,950 |
| Sold\treceivables | 37 | — |  | 37 |
| Income\ttaxes\treceivable | 177 | 34 | (a)(b)(e)(g) | 211 |
| Inventories | 3,161 | (67) | (d)(g) | 3,094 |
| Prepaid\texpenses | 388 | — |  | 388 |
| Other\tcurrent\tassets | 419 | 12 | (a)(d)(g) | 431 |
| Assets\theld\tfor\tsale | — | — |  | — |
| Total\tcurrent\tassets | 9,501 | (21) |  | 9,480 |
| Property,\tplant\tand\tequipment,\tnet | 7,258 | (141) | (b)(g) | 7,117 |
| Goodwill | 44,270 | 32 | (f)(g) | 44,302 |
| Intangible\tassets,\tnet | 59,101 | (17) | (f) | 59,084 |
| Other\tnon-current\tassets | 1,766 | — |  | 1,766 |
| TOTAL\tASSETS | $121,896 | $(147) |  | $121,749 |
| LIABILITIES\tAND\tEQUITY |  |  |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $34 | $— |  | $34 |
| Current\tportion\tof\tlong-term\tdebt | 2,754 | (31) | (b)(g) | 2,723 |
| Trade\tpayables | 4,326 | (90) | (g) | 4,236 |
| Accrued\tmarketing | 474 | 6 | (g) | 480 |
| Interest\tpayable | 404 | — |  | 404 |
| Other\tcurrent\tliabilities | 1,099 | 137 | (a)(g) | 1,236 |
| Liabilities\theld\tfor\tsale | — | — |  | — |
| Total\tcurrent\tliabilities | 9,091 | 22 |  | 9,113 |
| Long-term\tdebt | 31,380 | (111) | (b)(g) | 31,269 |
| Deferred\tincome\ttaxes | 14,230 | 30 | (a)(e)(f)(g) | 14,260 |
| Accrued\tpostemployment\tcosts | 394 | — |  | 394 |
| Other\tnon-current\tliabilities | 929 | 69 | (a) | 998 |
| TOTAL\tLIABILITIES | 56,024 | 10 |  | 56,034 |
| Commitments\tand\tContingencies |  |  |  |  |
| Redeemable\tnoncontrolling\tinterest | 7 | — |  | 7 |
| Equity: |  |  |  |  |
| outstanding\tat\tJune\t30,\t2018) | 12 | — |  | 12 |
| Additional\tpaid-in\tcapital | 58,766 | (77) | (d) | 58,689 |
| Retained\tearnings/(deficit) | 8,710 | (86) | (a)(b)(d)(e)(f)(g) | 8,624 |
| Accumulated\tother\tcomprehensive\tincome/(losses) | (1,557) | 6 | (b)(e)(f) | (1,551) |
| Treasury\tstock,\tat\tcost\t(3\tshares\tat\tJune\t30,\t2018) | (254) | — |  | (254) |
| Total\tshareholders'\tequity | 65,677 | (157) |  | 65,520 |
| Noncontrolling\tinterest | 188 | — |  | 188 |
| TOTAL\tEQUITY | 65,865 | (157) |  | 65,708 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $121,896 | $(147) |  | $121,749 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	$1	million,	a	decrease	to	other	current	assets	of	$25 million,	an	increase	to	other	current	liabilities	of	$67	million,	a	decrease	to	deferred	income	taxes	of	$38	million,	an	increase	to	other	non-current	liabilities	of	$69 million,	and	a	decrease	to	retained	earnings	of	$122	million	at	June	30,	2018.

(b)	Capital	Leases—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	less	than	$1	million,	a	decrease	to	property,	plant	and equipment,	net,	of	$139	million,	a	decrease	to	current	portion	of	long-term	debt	of	$29	million,	a	decrease	to	long-term	debt	of	$111	million,	an	increase	to	retained earnings	of	$1	million,	and	an	increase	to	accumulated	other	comprehensive	losses	of	less	than	$1	million	at	June	30,	2018.

(d)	Balance	Sheet	Misclassifications—The	correction	of	these	misstatements	resulted	in	a	decrease	to	inventories	of	$65	million,	an	increase	to	other	current	assets	of $65	million,	a	decrease	to	additional	paid-in	capital	of	$77	million,	and	an	increase	to	retained	earnings	of	$77	million	at	June	30,	2018.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	$29	million,	an	increase	to	deferred	income	taxes	of	$73 million,	a	decrease	to	retained	earnings	of	$51	million,	and	a	decrease	to	accumulated	other	comprehensive	losses	of	$7	million	at	June	30,	2018.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	an	increase	to	goodwill	of	$31	million,	a	decrease	to	intangible	assets,	net	of	$17	million,	a	decrease to	deferred	income	taxes	of	$4	million,	an	increase	to	retained	earnings	of	$19	million,	and	an	increase	to	accumulated	other	comprehensive	losses	of	$1	million	at	June 30,	2018.

(g)	Other—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	$4	million,	a	decrease	to	inventories	of	$2	million,	a	decrease	to other	current	assets	of	$28	million,	a	decrease	to	property,	plant	and	equipment,	net	of	$2	million,	an	increase	to	goodwill	of	$1	million,	a	decrease	to	current	portion	of long-term	debt	of	$2	million,	a	decrease	to	trade	payables	of	$90	million,	an	increase	to	accrued	marketing	of	$6	million,	an	increase	to	other	current	liabilities	of	$70 million,	an	increase	to	long-term	debt	of	less	than	$1	million,	a	decrease	to	deferred	income	taxes	of	$1	million,	and	a	decrease	to	retained	earnings	of	$10	million	at June	30,	2018.

|  | As	Previously<br>Reported | March	31,	2018<br>Restatement<br>Impacts | Restatement<br>Reference | As	Restated |
| :--- | :--- | :--- | :--- | :--- |
| ASSETS |  |  |  |  |
| Cash\tand\tcash\tequivalents | $1,794 | $— |  | $1,794 |
| Trade\treceivables\t(net\tof\tallowances\tof\t$24\tat\tMarch\t31,\t2018) | 1,044 | — |  | 1,044 |
| Sold\treceivables | 530 | — |  | 530 |
| Income\ttaxes\treceivable | 150 | (29) | (a)(b)(d)(e)(g) | 121 |
| Inventories | 3,144 | (55) | (d)(g) | 3,089 |
| Prepaid\texpenses | 367 | — |  | 367 |
| Other\tcurrent\tassets | 408 | 18 | (a)(d)(g) | 426 |
| Assets\theld\tfor\tsale | — | — |  | — |
| Total\tcurrent\tassets | 7,437 | (66) |  | 7,371 |
| Property,\tplant\tand\tequipment,\tnet | 7,267 | (122) | (b)(g) | 7,145 |
| Goodwill | 44,843 | 1 | (g) | 44,844 |
| Intangible\tassets,\tnet | 59,600 | (17) | (f) | 59,583 |
| Other\tnon-current\tassets | 1,640 | — |  | 1,640 |
| TOTAL\tASSETS | $120,787 | $(204) |  | $120,583 |
| LIABILITIES\tAND\tEQUITY |  |  |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $1,001 | $2 | (g) | $1,003 |
| Current\tportion\tof\tlong-term\tdebt | 2,742 | (27) | (b)(g) | 2,715 |
| Trade\tpayables | 4,241 | (93) | (g) | 4,148 |
| Accrued\tmarketing | 567 | 9 | (g) | 576 |
| Interest\tpayable | 345 | — |  | 345 |
| Other\tcurrent\tliabilities | 1,433 | 67 | (a)(d)(e)(g) | 1,500 |
| Liabilities\theld\tfor\tsale | — | — |  | — |
| Total\tcurrent\tliabilities | 10,329 | (42) |  | 10,287 |
| Long-term\tdebt | 28,561 | (96) | (b)(g) | 28,465 |
| Deferred\tincome\ttaxes | 14,085 | 21 | (a)(e)(f)(g) | 14,106 |
| Accrued\tpostemployment\tcosts | 400 | — |  | 400 |
| Other\tnon-current\tliabilities | 949 | 74 | (a) | 1,023 |
| TOTAL\tLIABILITIES | 54,324 | (43) |  | 54,281 |
| Commitments\tand\tContingencies |  |  |  |  |
| Redeemable\tnoncontrolling\tinterest | 8 | — |  | 8 |
| Equity: |  |  |  |  |
| outstanding\tat\tMarch\t31,\t2018) | 12 | — |  | 12 |
| Additional\tpaid-in\tcapital | 58,733 | (77) | (d) | 58,656 |
| Retained\tearnings/(deficit) | 8,718 | (84) | (a)(b)(d)(e)(f)(g) | 8,634 |
| Accumulated\tother\tcomprehensive\tincome/(losses) | (975) | — | (b)(e) | (975) |
| Treasury\tstock,\tat\tcost\t(3\tshares\tat\tMarch\t31,\t2018) | (240) | — |  | (240) |
| Total\tshareholders'\tequity | 66,248 | (161) |  | 66,087 |
| Noncontrolling\tinterest | 207 | — |  | 207 |
| TOTAL\tEQUITY | 66,455 | (161) |  | 66,294 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $120,787 | $(204) |  | $120,583 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	$1	million,	a	decrease	to	other	current	assets	of	$8 million,	an	increase	to	other	current	liabilities	of	$63	million,	a	decrease	to	deferred	income	taxes	of	$35	million,	an	increase	to	other	non-current	liabilities	of	$74 million,	and	a	decrease	to	retained	earnings	of	$111	million	at	March	31,	2018.

(b)	Capital	Leases—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	less	than	$1	million,	a	decrease	to	property,	plant	and equipment,	net,	of	$120	million,	a	decrease	to	current	portion	of	long-term	debt	of	$25	million,	a	decrease	to	long-term	debt	of	$96	million,	an	increase	to	retained earnings	of	$1	million,	and	a	decrease	to	accumulated	other	comprehensive	losses	of	less	than	$1	million	at	March	31,	2018.

(d)	Balance	Sheet	Misclassifications—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	$28	million,	a	decrease	to	inventories	of $53	million,	an	increase	other	current	assets	of	$53	million,	a	decrease	to	other	current	liabilities	of	$28	million,	a	decrease	to	additional	paid-in	capital	of	$77	million and	an	increase	to	retained	earnings	of	$77	million	at	March	31,	2018.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	less	than	$1	million,	a	decrease	to	other	current	liabilities of	$29	million,	an	increase	to	deferred	income	taxes	of	$59	million,	a	decrease	to	retained	earnings	of	$30	million,	and	a	decrease	to	accumulated	other	comprehensive losses	of	less	than	$1	million	at	March	31,	2018.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	intangible	assets,	net	of	$17	million,	a	decrease	to	deferred	income	taxes	of	$4	million, and	a	decrease	to	retained	earnings	of	$13	million	at	March	31,	2018.

(g)	Other—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	less	than	$1	million,	a	decrease	to	inventories	of	$2	million,	a decrease	to	other	current	assets	of	$27	million,	a	decrease	to	property,	plant	and	equipment,	net	of	$2	million,	an	increase	to	goodwill	of	$1	million,	an	increase	to commercial	paper	and	other	short	term	debt	of	$2	million,	a	decrease	to	current	portion	of	long-term	debt	of	$2	million,	a	decrease	to	trade	payables	of	$93	million,	an increase	to	accrued	marketing	of	$9	million,	an	increase	to	other	current	liabilities	of	$61	million,	an	increase	to	long-term	debt	of	less	than	$1	million,	an	increase	to deferred	income	taxes	of	$1	million,	and	a	decrease	to	retained	earnings	of	$8	million	at	March	31,	2018.

|  | As	Previously<br>Reported | September	30,	2017<br>Restatement<br>Impacts | Restatement<br>Reference | As	Restated |
| :--- | :--- | :--- | :--- | :--- |
| ASSETS |  |  |  |  |
| Cash\tand\tcash\tequivalents | $1,441 | $— |  | $1,441 |
| Trade\treceivables\t(net\tof\tallowances\tof\t$29\tat\tSeptember\t30,\t2017) | 938 | — |  | 938 |
| Sold\treceivables | 427 | — |  | 427 |
| Income\ttaxes\treceivable | 328 | (38) | (a)(e)(g) | 290 |
| Inventories | 3,188 | (52) | (d) | 3,136 |
| Prepaid\texpenses | 368 | — |  | 368 |
| Other\tcurrent\tassets | 538 | (11) | (a)(d) | 527 |
| Assets\theld\tfor\tsale | — | — |  | — |
| Total\tcurrent\tassets | 7,228 | (101) |  | 7,127 |
| Property,\tplant\tand\tequipment,\tnet | 6,934 | (32) | (b)(g) | 6,902 |
| Goodwill | 44,858 | 1 | (g) | 44,859 |
| Intangible\tassets,\tnet | 59,500 | (17) | (f) | 59,483 |
| Other\tnon-current\tassets | 1,531 | — |  | 1,531 |
| TOTAL\tASSETS | $120,051 | $(149) |  | $119,902 |
| LIABILITIES\tAND\tEQUITY |  |  |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $455 | $2 | (g) | $457 |
| Current\tportion\tof\tlong-term\tdebt | 2,755 | (8) | (b)(g) | 2,747 |
| Trade\tpayables | 3,947 | (74) | (g) | 3,873 |
| Accrued\tmarketing | 493 | 7 | (g) | 500 |
| Interest\tpayable | 295 | — |  | 295 |
| Other\tcurrent\tliabilities | 1,442 | 136 | (a)(e)(g) | 1,578 |
| Liabilities\theld\tfor\tsale | — | — |  | — |
| Total\tcurrent\tliabilities | 9,387 | 63 |  | 9,450 |
| Long-term\tdebt | 28,299 | (23) | (b)(g) | 28,276 |
| Deferred\tincome\ttaxes | 20,898 | (57) | (a)(e)(f) | 20,841 |
| Accrued\tpostemployment\tcosts | 1,808 | — |  | 1,808 |
| Other\tnon-current\tliabilities | 688 | 27 | (a) | 715 |
| TOTAL\tLIABILITIES | 61,080 | 10 |  | 61,090 |
| Commitments\tand\tContingencies |  |  |  |  |
| Redeemable\tnoncontrolling\tinterest | — | — |  | — |
| Equity: |  |  |  |  |
| outstanding\tat\tSeptember\t30,\t2017) | 12 | — |  | 12 |
| Additional\tpaid-in\tcapital | 58,695 | (77) | (d) | 58,618 |
| Retained\tearnings/(deficit) | 1,360 | (80) | (a)(d)(e)(f)(g) | 1,280 |
| Accumulated\tother\tcomprehensive\tincome/(losses) | (1,085) | (2) | (e) | (1,087) |
| Treasury\tstock,\tat\tcost\t(3\tshares\tat\tSeptember\t30,\t2017) | (223) | — |  | (223) |
| Total\tshareholders'\tequity | 58,759 | (159) |  | 58,600 |
| Noncontrolling\tinterest | 212 | — |  | 212 |
| TOTAL\tEQUITY | 58,971 | (159) |  | 58,812 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $120,051 | $(149) |  | $119,902 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	$1	million,	a	decrease	to	other	current	assets	of	$63 million,	an	increase	to	other	current	liabilities	of	$39	million,	a	decrease	to	deferred	income	taxes	of	$45	million,	an	increase	to	other	non-current	liabilities	of	$27 million,	and	a	decrease	to	retained	earnings	of	$83	million	at	September	30,	2017.

(b)	Capital	Leases—The	correction	of	these	misstatements	resulted	in	a	decrease	to	property,	plant	and	equipment,	net,	of	$29	million,	a	decrease	to	current	portion	of long-term	debt	of	$7	million,	and	a	decrease	to	long-term	debt	of	$22	million	at	September	30,	2017.

(d)	Balance	Sheet	Misclassifications—The	correction	of	these	misstatements	resulted	in	a	decrease	to	inventories	of	$52	million,	an	increase	other	current	assets	of	$52 million,	a	decrease	to	additional	paid-in	capital	of	$77	million,	and	an	increase	to	retained	earnings	of	$77	million	at	September	30,	2017.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	$48	million,	a	decrease	in	other	current	liabilities	of	less than	$1	million,	a	decrease	to	deferred	income	taxes	of	$8	million,	a	decrease	to	retained	earnings	of	$38	million,	and	an	increase	to	accumulated	other	comprehensive losses	of	$2	million	at	September	30,	2017.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	intangible	assets,	net	of	$17	million,	a	decrease	to	deferred	income	taxes	of	$4	million, and	a	decrease	to	retained	earnings	of	$13	million	at	September	30,	2017.

(g)	Other—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	$9	million,	a	decrease	to	property,	plant	and	equipment,	net	of	$3 million,	an	increase	to	goodwill	of	$1	million,	an	increase	to	commercial	paper	and	other	short	term	debt	of	$2	million,	a	decrease	to	current	portion	of	long-term	debt	of $1	million,	a	decrease	to	trade	payables	of	$74	million,	an	increase	to	accrued	marketing	of	$7	million,	an	increase	to	other	current	liabilities	of	$97	million,	a	decrease	to long-term	debt	of	$1	million,	and	a	decrease	to	retained	earnings	of	$23	million	at	September	30,	2017.

|  | As	Previously<br>Reported | Restatement<br>Impacts | Restatement<br>Reference | As	Restated |
| :--- | :--- | :--- | :--- | :--- |
| ASSETS |  |  |  |  |
| Cash\tand\tcash\tequivalents | $1,445 | $— |  | $1,445 |
| Trade\treceivables\t(net\tof\tallowances\tof\t$28\tat\tJuly\t1,\t2017) | 913 | 60 | (d) | 973 |
| Sold\treceivables | 521 | (60) | (d) | 461 |
| Income\ttaxes\treceivable | 277 | (40) | (a)(e)(g) | 237 |
| Inventories | 3,065 | (53) | (d) | 3,012 |
| Prepaid\texpenses | 359 | — |  | 359 |
| Other\tcurrent\tassets | 528 | 19 | (a)(d) | 547 |
| Assets\theld\tfor\tsale | — | — |  | — |
| Total\tcurrent\tassets | 7,108 | (74) |  | 7,034 |
| Property,\tplant\tand\tequipment,\tnet | 6,808 | (4) | (g) | 6,804 |
| Goodwill | 44,565 | 1 | (g) | 44,566 |
| Intangible\tassets,\tnet | 59,400 | (17) | (f) | 59,383 |
| Other\tnon-current\tassets | 1,535 | — |  | 1,535 |
| TOTAL\tASSETS | $119,416 | $(94) |  | $119,322 |
| LIABILITIES\tAND\tEQUITY |  |  |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $1,090 | $— |  | $1,090 |
| Current\tportion\tof\tlong-term\tdebt | 19 | — | (g) | 19 |
| Trade\tpayables | 3,888 | (83) | (g) | 3,805 |
| Accrued\tmarketing | 494 | 5 | (g) | 499 |
| Interest\tpayable | 406 | — |  | 406 |
| Other\tcurrent\tliabilities | 1,459 | 130 | (a)(e)(g) | 1,589 |
| Liabilities\theld\tfor\tsale | — | — |  | — |
| Total\tcurrent\tliabilities | 7,356 | 52 |  | 7,408 |
| Long-term\tdebt | 29,979 | (1) | (g) | 29,978 |
| Deferred\tincome\ttaxes | 20,887 | (47) | (a)(e)(f) | 20,840 |
| Accrued\tpostemployment\tcosts | 1,975 | — |  | 1,975 |
| Other\tnon-current\tliabilities | 673 | 28 | (a) | 701 |
| TOTAL\tLIABILITIES | 60,870 | 32 |  | 60,902 |
| Commitments\tand\tContingencies |  |  |  |  |
| Redeemable\tnoncontrolling\tinterest | — | — |  | — |
| Equity: |  |  |  |  |
| outstanding\tat\tJuly\t1,\t2017) | 12 | — |  | 12 |
| Additional\tpaid-in\tcapital | 58,674 | (77) | (d) | 58,597 |
| Retained\tearnings/(deficit) | 1,178 | (49) | (a)(d)(e)(f)(g) | 1,129 |
| Accumulated\tother\tcomprehensive\tincome/(losses) | (1,308) | — | (e) | (1,308) |
| Treasury\tstock,\tat\tcost\t(3\tshares\tat\tJuly\t1,\t2017) | (223) | — |  | (223) |
| Total\tshareholders'\tequity | 58,333 | (126) |  | 58,207 |
| Noncontrolling\tinterest | 213 | — |  | 213 |
| TOTAL\tEQUITY | 58,546 | (126) |  | 58,420 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $119,416 | $(94) |  | $119,322 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	$1	million,	a	decrease	to	other	current	assets	of	$34 million,	an	increase	to	other	current	liabilities	of	$31	million,	a	decrease	to	deferred	income	taxes	of	$33	million,	an	increase	to	other	non-current	liabilities	of	$28 million,	and	a	decrease	to	retained	earnings	of	$59	million	at	July	1,	2017.

(d)	Balance	Sheet	Misclassifications—The	correction	of	these	misstatements	resulted	in	an	increase	to	trade	receivables,	net	of	$60	million,	a	decrease	to	sold	receivables of	$60	million,	a	decrease	to	inventories	of	$53	million,	an	increase	other	current	assets	of	$53	million,	a	decrease	to	additional	paid-in	capital	of	$77	million,	and	an increase	to	retained	earnings	of	$77	million	at	July	1,	2017.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	$48	million,	an	increase	in	other	current	liabilities	of	less than	$1	million,	a	decrease	to	deferred	income	taxes	of	$10	million,	a	decrease	to	retained	earnings	of	$38	million,	and	an	increase	to	accumulated	other	comprehensive losses	of	less	than	$1	million	at	July	1,	2017.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	intangible	assets,	net	of	$17	million,	a	decrease	to	deferred	income	taxes	of	$4	million, and	a	decrease	to	retained	earnings	of	$13	million	at	July	1,	2017.

(g)	Other—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	$7	million,	a	decrease	to	property,	plant	and	equipment,	net	of	$4 million,	an	increase	to	goodwill	of	$1	million,	a	decrease	to	current	portion	of	long-term	debt	of	less	than	$1	million,	a	decrease	to	trade	payables	of	$83	million,	an increase	to	accrued	marketing	of	$5	million,	an	increase	to	other	current	liabilities	of	$99	million,	a	decrease	to	long-term	debt	of	$1	million,	and	a	decrease	to	retained earnings	of	$16	million	at	July	1,	2017.

|  | As	Previously<br>Reported | Restatement<br>Impacts | Restatement<br>Reference | As	Restated |
| :--- | :--- | :--- | :--- | :--- |
| ASSETS |  |  |  |  |
| Cash\tand\tcash\tequivalents | $3,242 | $— |  | $3,242 |
| Trade\treceivables\t(net\tof\tallowances\tof\t$30\tat\tApril\t1,\t2017) | 886 | 50 | (d) | 936 |
| Sold\treceivables | 588 | (50) | (d) | 538 |
| Income\ttaxes\treceivable | 270 | (1) | (a)(e)(g) | 269 |
| Inventories | 3,151 | (57) | (d) | 3,094 |
| Prepaid\texpenses | 349 | — |  | 349 |
| Other\tcurrent\tassets | 389 | 222 | (a)(d)(g) | 611 |
| Assets\theld\tfor\tsale | — | — |  | — |
| Total\tcurrent\tassets | 8,875 | 164 |  | 9,039 |
| Property,\tplant\tand\tequipment,\tnet | 6,693 | (4) | (g) | 6,689 |
| Goodwill | 44,300 | 1 | (g) | 44,301 |
| Intangible\tassets,\tnet | 59,330 | (17) | (f) | 59,313 |
| Other\tnon-current\tassets | 1,604 | — |  | 1,604 |
| TOTAL\tASSETS | $120,802 | $144 |  | $120,946 |
| LIABILITIES\tAND\tEQUITY |  |  |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $909 | $— |  | $909 |
| Current\tportion\tof\tlong-term\tdebt | 2,023 | (1) | (g) | 2,022 |
| Trade\tpayables | 3,936 | (78) | (g) | 3,858 |
| Accrued\tmarketing | 599 | 2 | (g) | 601 |
| Interest\tpayable | 346 | — |  | 346 |
| Other\tcurrent\tliabilities | 1,570 | 335 | (a)(e)(g) | 1,905 |
| Liabilities\theld\tfor\tsale | — | — |  | — |
| Total\tcurrent\tliabilities | 9,383 | 258 |  | 9,641 |
| Long-term\tdebt | 29,748 | (1) | (g) | 29,747 |
| Deferred\tincome\ttaxes | 20,910 | (37) | (a)(e)(f) | 20,873 |
| Accrued\tpostemployment\tcosts | 2,016 | — |  | 2,016 |
| Other\tnon-current\tliabilities | 801 | 50 | (a)(g) | 851 |
| TOTAL\tLIABILITIES | 62,858 | 270 |  | 63,128 |
| Commitments\tand\tContingencies |  |  |  |  |
| Redeemable\tnoncontrolling\tinterest | — | — |  | — |
| Equity: |  |  |  |  |
| outstanding\tat\tApril\t1,\t2017) | 12 | — |  | 12 |
| Additional\tpaid-in\tcapital | 58,642 | (77) | (d) | 58,565 |
| Retained\tearnings/(deficit) | 750 | (45) | (a)(d)(e)(f)(g) | 705 |
| Accumulated\tother\tcomprehensive\tincome/(losses) | (1,449) | (4) | (e) | (1,453) |
| Treasury\tstock,\tat\tcost\t(2\tshares\tat\tApril\t1,\t2017) | (223) | — |  | (223) |
| Total\tshareholders'\tequity | 57,732 | (126) |  | 57,606 |
| Noncontrolling\tinterest | 212 | — |  | 212 |
| TOTAL\tEQUITY | 57,944 | (126) |  | 57,818 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $120,802 | $144 |  | $120,946 |

(a)	Supplier	Rebates—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	$1	million,	a	decrease	to	other	current	assets	of	$15 million,	an	increase	to	other	current	liabilities	of	$26	million,	a	decrease	to	deferred	income	taxes	of	$26	million,	an	increase	to	other	non-current	liabilities	of	$28 million,	and	a	decrease	to	retained	earnings	of	$44	million	at	April	1,	2017.

(d)	Balance	Sheet	Misclassifications—The	correction	of	these	misstatements	resulted	in	an	increase	to	trade	receivables,	net	of	$50	million,	a	decrease	to	sold	receivables of	$50	million,	a	decrease	to	inventories	of	$57	million,	an	increase	to	other	current	assets	of	$57	million,	a	decrease	to	additional	paid-in	capital	of	$77	million,	and	an increase	to	retained	earnings	of	$77	million	at	April	1,	2017.

(e)	Income	Taxes—The	correction	of	these	misstatements	resulted	in	a	decrease	to	income	taxes	receivable	of	less	than	$1	million,	an	increase	in	other	current	liabilities of	$49	million,	a	decrease	to	deferred	income	taxes	of	$7	million,	a	decrease	to	retained	earnings	of	$38	million,	and	an	increase	to	accumulated	other	comprehensive losses	of	$4	million	at	April	1,	2017.

(f)	Impairments—The	correction	of	these	misstatements	resulted	in	a	decrease	to	intangible	assets,	net	of	$17	million,	a	decrease	to	deferred	income	taxes	of	$4	million, and	a	decrease	to	retained	earnings	of	$13	million	at	April	1,	2017.

(g)	Other—The	correction	of	these	misstatements	resulted	in	an	increase	to	income	taxes	receivable	of	less	than	$1	million,	an	increase	to	other	current	assets	of	$180 million,	a	decrease	to	property,	plant	and	equipment,	net	of	$4	million,	an	increase	to	goodwill	of	$1	million,	a	decrease	to	current	portion	of	long-term	debt	of	$1 million,	a	decrease	to	trade	payables	of	$78	million,	an	increase	to	accrued	marketing	of	$2	million,	an	increase	to	other	current	liabilities	of	$260	million,	a	decrease	to long-term	debt	of	$1	million,	an	increase	to	other	non-current	liabilities	of	$22	million,	and	a	decrease	to	retained	earnings	of	$27	million	at	April	1,	2017.

# Condensed	Consolidated	Statement	of	Equity

# For	the	Nine	Months	Ended	September	29,	2018

|  | Restatement<br>Reference | Common	Stock | Additional<br>Paid-in<br>Capital | Retained<br>Earnings/(Deficit) | Accumulated	Other<br>Comprehensive<br>Income/(Losses) | Treasury<br>Stock,	at<br>Cost | Noncontrolling	Interest | Total	Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| As\tPreviously\tReported |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t30,\t2017 |  | $12 | $58,711 | $8,589 | $(1,054) | $(224) | $207 | $66,241 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest |  | — | — | 2,379 | — | — | 6 | 2,385 |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest |  | — | — | — | (678) | — | (13) | (691) |
| Dividends\tdeclared-common\tstock\t($1.875\tper\nshare) |  | — | — | (2,286) | — | — | — | (2,286) |
| Cumulative\teffect\tof\taccounting\tstandards\nadopted\tin\tthe\tperiod |  | — | — | (97) | — | — | — | (97) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 82 | (9) | — | (40) | (13) | 20 |
| Balance\tat\tSeptember\t29,\t2018 |  | $12 | $58,793 | $8,576 | $(1,732) | $(264) | $187 | $65,572 |
| Restatement\tImpacts |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t30,\t2017 |  | $— | $(77) | $(94) | $— | $— | $— | $(171) |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest | (a)(b)(e)(f)(g) | — | — | (3) | — | — | 1 | (2) |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest | (b)(e)(f) | — | — | — | 8 | — | — | 8 |
| Dividends\tdeclared-common\tstock\t($1.875\tper\nshare) |  | — | — | — | — | — | — | — |
| Cumulative\teffect\tof\taccounting\tstandards\nadopted\tin\tthe\tperiod |  | — | — | — | — | — | — | — |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | — | — | — | — | — | — |
| Balance\tat\tSeptember\t29,\t2018 |  | $— | $(77) | $(97) | $8 | $— | $1 | $(165) |
| As\tRestated |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t30,\t2017 |  | $12 | $58,634 | $8,495 | $(1,054) | $(224) | $207 | $66,070 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest |  | — | — | 2,376 | — | — | 7 | 2,383 |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest |  | — | — | — | (670) | — | (13) | (683) |
| Dividends\tdeclared-common\tstock\t($1.875\tper\nshare) |  | — | — | (2,286) | — | — | — | (2,286) |
| Cumulative\teffect\tof\taccounting\tstandards\nadopted\tin\tthe\tperiod |  | — | — | (97) | — | — | — | (97) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 82 | (9) | — | (40) | (13) | 20 |
| Balance\tat\tSeptember\t29,\t2018 |  | $12 | $58,716 | $8,479 | $(1,724) | $(264) | $188 | $65,407 |

See	descriptions	of	the	net	income	and	other	comprehensive	income	impacts	in	the	consolidated	statement	of	income	and	consolidated	statement	of	comprehensive income	for	the	nine	months	ended	September	29,	2018	sections	above.

|  | Restatement<br>Reference | Common	Stock | Additional<br>Paid-in<br>Capital | Retained<br>Earnings/(Deficit) | Accumulated	Other<br>Comprehensive<br>Income/(Losses) | Treasury<br>Stock,	at<br>Cost | Noncontrolling	Interest | Total	Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| As\tPreviously\tReported |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t30,\t2017 |  | $12 | $58,711 | $8,589 | $(1,054) | $(224) | $207 | $66,241 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest |  | — | — | 1,749 | — | — | 5 | 1,754 |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest |  | — | — | — | (503) | — | (11) | (514) |
| Dividends\tdeclared-common\tstock\t($1.25\tper\nshare) |  | — | — | (1,524) | — | — | — | (1,524) |
| Cumulative\teffect\tof\taccounting\tstandards\nadopted\tin\tthe\tperiod |  | — | — | (95) | — | — | — | (95) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 55 | (9) | — | (30) | (13) | 3 |
| Balance\tat\tJune\t30,\t2018 |  | $12 | $58,766 | $8,710 | $(1,557) | $(254) | $188 | $65,865 |
| Restatement\tImpacts |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t30,\t2017 |  | $— | $(77) | $(94) | $— | $— | $— | $(171) |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest | (a)(b)(e)(f)(g) | — | — | 8 | — | — | — | 8 |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest | (b)(e)(f) | — | — | — | 6 | — | — | 6 |
| Dividends\tdeclared-common\tstock\t($1.25\tper\nshare) |  | — | — | — | — | — | — | — |
| Cumulative\teffect\tof\taccounting\tstandards\nadopted\tin\tthe\tperiod |  | — | — | — | — | — | — | — |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | — | — | — | — | — | — |
| Balance\tat\tJune\t30,\t2018 |  | $— | $(77) | $(86) | $6 | $— | $— | $(157) |
| As\tRestated |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t30,\t2017 |  | $12 | $58,634 | $8,495 | $(1,054) | $(224) | $207 | $66,070 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest |  | — | — | 1,757 | — | — | 5 | 1,762 |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest |  | — | — | — | (497) | — | (11) | (508) |
| Dividends\tdeclared-common\tstock\t($1.25\tper\nshare) |  | — | — | (1,524) | — | — | — | (1,524) |
| Cumulative\teffect\tof\taccounting\tstandards\nadopted\tin\tthe\tperiod |  | — | — | (95) | — | — | — | (95) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 55 | (9) | — | (30) | (13) | 3 |
| Balance\tat\tJune\t30,\t2018 |  | $12 | $58,689 | $8,624 | $(1,551) | $(254) | $188 | $65,708 |

See	descriptions	of	the	net	income	and	other	comprehensive	income	impacts	in	the	consolidated	statement	of	income	and	consolidated	statement	of	comprehensive income	for	the	six	months	ended	June	30,	2018	sections	above.

# For	the	Three	Months	Ended	March	31,	2018

|  | Restatement<br>Reference | Common	Stock | Additional<br>Paid-in<br>Capital | Retained<br>Earnings/(Deficit) | Accumulated	Other<br>Comprehensive<br>Income/(Losses) | Treasury<br>Stock,	at<br>Cost | Noncontrolling	Interest | Total	Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| As\tPreviously\tReported |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t30,\t2017 |  | $12 | $58,711 | $8,589 | $(1,054) | $(224) | $207 | $66,241 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest |  | — | — | 993 | — | — | 5 | 998 |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest |  | — | — | — | 79 | — | (5) | 74 |
| Dividends\tdeclared-common\tstock\t($0.625\tper\nshare) |  | — | — | (762) | — | — | — | (762) |
| Cumulative\teffect\tof\taccounting\tstandards\nadopted\tin\tthe\tperiod |  | — | — | (95) | — | — | — | (95) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 22 | (7) | — | (16) | — | (1) |
| Balance\tat\tMarch\t31,\t2018 |  | $12 | $58,733 | $8,718 | $(975) | $(240) | $207 | $66,455 |
| Restatement\tImpacts |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t30,\t2017 |  | $— | $(77) | $(94) | $— | $— | $— | $(171) |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest | (a)(b)(e)(f)(g) | — | — | 10 | — | — | — | 10 |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest | (b)(e) | — | — | — | — | — | — | — |
| Dividends\tdeclared-common\tstock\t($0.625\tper\nshare) |  | — | — | — | — | — | — | — |
| Cumulative\teffect\tof\taccounting\tstandards\nadopted\tin\tthe\tperiod |  | — | — | — | — | — | — | — |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | — | — | — | — | — | — |
| Balance\tat\tMarch\t31,\t2018 |  | $— | $(77) | $(84) | $— | $— | $— | $(161) |
| As\tRestated |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t30,\t2017 |  | $12 | $58,634 | $8,495 | $(1,054) | $(224) | $207 | $66,070 |
| Net\tincome/(loss)\texcluding\tredeemable\nnoncontrolling\tinterest |  | — | — | 1,003 | — | — | 5 | 1,008 |
| Other\tcomprehensive\tincome/(loss)\texcluding\nredeemable\tnoncontrolling\tinterest |  | — | — | — | 79 | — | (5) | 74 |
| Dividends\tdeclared-common\tstock\t($0.625\tper\nshare) |  | — | — | (762) | — | — | — | (762) |
| Cumulative\teffect\tof\taccounting\tstandards\nadopted\tin\tthe\tperiod |  | — | — | (95) | — | — | — | (95) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 22 | (7) | — | (16) | — | (1) |
| Balance\tat\tMarch\t31,\t2018 |  | $12 | $58,656 | $8,634 | $(975) | $(240) | $207 | $66,294 |

See	descriptions	of	the	net	income	and	other	comprehensive	income	impacts	in	the	consolidated	statement	of	income	and	consolidated	statement	of	comprehensive income	for	the	three	months	ended	March	31,	2018	sections	above.

# For	the	Nine	Months	Ended	September	30,	2017

|  | Restatement<br>Reference | Common	Stock | Additional<br>Paid-in<br>Capital | Retained<br>Earnings/(Deficit) | Accumulated	Other<br>Comprehensive<br>Income/(Losses) | Treasury<br>Stock,	at<br>Cost | Noncontrolling	Interest | Total	Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| As\tPreviously\tReported |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t31,\t2016 |  | $12 | $58,593 | $588 | $(1,628) | $(207) | $216 | $57,574 |
| Net\tincome/(loss) |  | — | — | 2,996 | — | — | (2) | 2,994 |
| Other\tcomprehensive\tincome/(loss) |  | — | — | — | 543 | — | (2) | 541 |
| Dividends\tdeclared-common\tstock\t($1.825\tper\nshare) |  | — | — | (2,225) | — | — | — | (2,225) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 102 | 1 | — | (16) | — | 87 |
| Balance\tat\tSeptember\t30,\t2017 |  | $12 | $58,695 | $1,360 | $(1,085) | $(223) | $212 | $58,971 |
| Restatement\tImpacts |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t31,\t2016 |  | $— | $(77) | $(36) | $(1) | $— | $— | $(114) |
| Net\tincome/(loss) | (a)(e)(f)(g) | — | — | (44) | — | — | — | (44) |
| Other\tcomprehensive\tincome/(loss) | (e) | — | — | — | (1) | — | — | (1) |
| Dividends\tdeclared-common\tstock\t($1.825\tper\nshare) |  | — | — | — | — | — | — | — |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | — | — | — | — | — | — |
| Balance\tat\tSeptember\t30,\t2017 |  | $— | $(77) | $(80) | $(2) | $— | $— | $(159) |
| As\tRestated |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t31,\t2016 |  | $12 | $58,516 | $552 | $(1,629) | $(207) | $216 | $57,460 |
| Net\tincome/(loss) |  | — | — | 2,952 | — | — | (2) | 2,950 |
| Other\tcomprehensive\tincome/(loss) |  | — | — | — | 542 | — | (2) | 540 |
| Dividends\tdeclared-common\tstock\t($1.825\tper\nshare) |  | — | — | (2,225) | — | — | — | (2,225) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 102 | 1 | — | (16) | — | 87 |
| Balance\tat\tSeptember\t30,\t2017 |  | $12 | $58,618 | $1,280 | $(1,087) | $(223) | $212 | $58,812 |

See	descriptions	of	the	net	income	and	other	comprehensive	income	impacts	in	the	consolidated	statement	of	income	and	consolidated	statement	of	comprehensive income	for	the	nine	months	ended	September	30,	2017	sections	above.

|  | Restatement<br>Reference | Common	Stock | Additional<br>Paid-in<br>Capital | Retained<br>Earnings/(Deficit) | Accumulated	Other<br>Comprehensive<br>Income/(Losses) | Treasury<br>Stock,	at<br>Cost | Noncontrolling	Interest | Total	Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| As\tPreviously\tReported |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t31,\t2016 |  | $12 | $58,593 | $588 | $(1,628) | $(207) | $216 | $57,574 |
| Net\tincome/(loss) |  | — | — | 2,052 | — | — | (1) | 2,051 |
| Other\tcomprehensive\tincome/(loss) |  | — | — | — | 320 | — | (2) | 318 |
| Dividends\tdeclared-common\tstock\t($1.20\tper\nshare) |  | — | — | (1,463) | — | — | — | (1,463) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 81 | 1 | — | (16) | — | 66 |
| Balance\tat\tJuly\t1,\t2017 |  | $12 | $58,674 | $1,178 | $(1,308) | $(223) | $213 | $58,546 |
| Restatement\tImpacts |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t31,\t2016 |  | $— | $(77) | $(36) | $(1) | $— | $— | $(114) |
| Net\tincome/(loss) | (a)(e)(f)(g) | — | — | (13) | — | — | — | (13) |
| Other\tcomprehensive\tincome/(loss) | (e) | — | — | — | 1 | — | — | 1 |
| Dividends\tdeclared-common\tstock\t($1.20\tper\nshare) |  | — | — | — | — | — | — | — |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | — | — | — | — | — | — |
| Balance\tat\tJuly\t1,\t2017 |  | $— | $(77) | $(49) | $— | $— | $— | $(126) |
| As\tRestated |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t31,\t2016 |  | $12 | $58,516 | $552 | $(1,629) | $(207) | $216 | $57,460 |
| Net\tincome/(loss) |  | — | — | 2,039 | — | — | (1) | 2,038 |
| Other\tcomprehensive\tincome/(loss) |  | — | — | — | 321 | — | (2) | 319 |
| Dividends\tdeclared-common\tstock\t($1.20\tper\nshare) |  | — | — | (1,463) | — | — | — | (1,463) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 81 | 1 | — | (16) | — | 66 |
| Balance\tat\tJuly\t1,\t2017 |  | $12 | $58,597 | $1,129 | $(1,308) | $(223) | $213 | $58,420 |

See	descriptions	of	the	net	income	and	other	comprehensive	income	impacts	in	the	consolidated	statement	of	income	and	consolidated	statement	of	comprehensive income	for	the	six	months	ended	July	1,	2017	sections	above.

# For	the	Three	Months	Ended	April	1,	2017

|  | Restatement<br>Reference | Common	Stock | Additional<br>Paid-in<br>Capital | Retained<br>Earnings/(Deficit) | Accumulated	Other<br>Comprehensive<br>Income/(Losses) | Treasury<br>Stock,	at<br>Cost | Noncontrolling	Interest | Total	Equity |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
| As\tPreviously\tReported |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t31,\t2016 |  | $12 | $58,593 | $588 | $(1,628) | $(207) | $216 | $57,574 |
| Net\tincome/(loss) |  | — | — | 893 | — | — | (2) | 891 |
| Other\tcomprehensive\tincome/(loss) |  | — | — | — | 179 | — | (2) | 177 |
| Dividends\tdeclared-common\tstock\t($0.60\tper\nshare) |  | — | — | (731) | — | — | — | (731) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 49 | — | — | (16) | — | 33 |
| Balance\tat\tApril\t1,\t2017 |  | $12 | $58,642 | $750 | $(1,449) | $(223) | $212 | $57,944 |
| Restatement\tImpacts |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t31,\t2016 |  | $— | $(77) | $(36) | $(1) | $— | $— | $(114) |
| Net\tincome/(loss) | (a)(e)(f)(g) | — | — | (10) | — | — | — | (10) |
| Other\tcomprehensive\tincome/(loss) | (e) | — | — | — | (3) | — | — | (3) |
| Dividends\tdeclared-common\tstock\t($0.60\tper\nshare) |  | — | — | — | — | — | — | — |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother | (g) | — | — | 1 | — | — | — | 1 |
| Balance\tat\tApril\t1,\t2017 |  | $— | $(77) | $(45) | $(4) | $— | $— | $(126) |
| As\tRestated |  |  |  |  |  |  |  |  |
| Balance\tat\tDecember\t31,\t2016 |  | $12 | $58,516 | $552 | $(1,629) | $(207) | $216 | $57,460 |
| Net\tincome/(loss) |  | — | — | 883 | — | — | (2) | 881 |
| Other\tcomprehensive\tincome/(loss) |  | — | — | — | 176 | — | (2) | 174 |
| Dividends\tdeclared-common\tstock\t($0.60\tper\nshare) |  | — | — | (731) | — | — | — | (731) |
| Exercise\tof\tstock\toptions,\tissuance\tof\tother\nstock\tawards,\tand\tother |  | — | 49 | 1 | — | (16) | — | 34 |
| Balance\tat\tApril\t1,\t2017 |  | $12 | $58,565 | $705 | $(1,453) | $(223) | $212 | $57,818 |

See	descriptions	of	the	net	income	and	other	comprehensive	income	impacts	in	the	consolidated	statement	of	income	and	consolidated	statement	of	comprehensive income	for	the	three	months	ended	April	1,	2017	sections	above.

|  |  | For	the	Nine	Months	Ended	September	29,	2018 | For	the	Nine	Months	Ended	September	29,	2018 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | \t Restatement\tImpacts | Restatement\nReference | As\tRestated |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES: |  |  |  |  |
| Net\tincome/(loss) | $2,376 | $(2) | (a)(b)(e)(f)(g) | $2,374 |
| Adjustments\tto\treconcile\tnet\tincome/(loss)\tto\toperating\tcash\tflows: |  |  |  |  |
| Depreciation\tand\tamortization | 736 | (24) | (b)(g) | 712 |
| Amortization\tof\tpostretirement\tbenefit\tplans\tprior\tservice\tcosts/(credits) | (261) | — |  | (261) |
| Equity\taward\tcompensation\texpense | 44 | — |  | 44 |
| Deferred\tincome\ttax\tprovision/(benefit) | 96 | 8 | (a)(e)(f)(g) | 104 |
| Postemployment\tbenefit\tplan\tcontributions | (64) | — |  | (64) |
| Goodwill\tand\tintangible\tasset\timpairment\tlosses | 499 | (48) | (f) | 451 |
| Nonmonetary\tcurrency\tdevaluation | 131 | — |  | 131 |
| Other\titems,\tnet | 36 | (1) | (a)(g) | 35 |
| Changes\tin\tcurrent\tassets\tand\tliabilities: |  |  |  |  |
| Trade\treceivables | (2,154) | — |  | (2,154) |
| Inventories | (663) | 18 | (d)(g) | (645) |
| Accounts\tpayable | 145 | (15) | (g) | 130 |
| Other\tcurrent\tassets | (105) | 2 | (a)(d) | (103) |
| Other\tcurrent\tliabilities | 83 | 41 | (a)(b)(e)(g) | 124 |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | 899 | (21) |  | 878 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES: |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | 1,296 | — |  | 1,296 |
| Capital\texpenditures | (594) | — |  | (594) |
| Payments\tto\tacquire\tbusiness,\tnet\tof\tcash\tacquired | (248) | — |  | (248) |
| Other\tinvesting\tactivities,\tnet | 31 | — |  | 31 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 485 | — |  | 485 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES: |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | (2,727) | 21 | (b)(g) | (2,706) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | 2,990 | — |  | 2,990 |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | 2,485 | — |  | 2,485 |
| Repayments\tof\tcommercial\tpaper | (1,950) | — |  | (1,950) |
| Dividends\tpaid\t-\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Dividends\tpaid\t-\tcommon\tstock | (2,421) | — |  | (2,421) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Other\tfinancing\tactivities,\tnet | (35) | — |  | (35) |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (1,658) | 21 |  | (1,637) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\tcash | (128) | — |  | (128) |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash |  |  |  |  |
| Net\tincrease/(decrease) | (402) | — |  | (402) |
| Balance\tat\tbeginning\tof\tperiod | 1,769 | — |  | 1,769 |
| Balance\tat\tend\tof\tperiod | $1,367 | $— |  | $1,367 |
| NON-CASH\tINVESTING\tACTIVITIES: |  |  |  |  |
| Beneficial\tinterest\tobtained\tin\texchange\tfor\tsecuritized\ttrade\treceivables | $938 | $— |  | $938 |

See	descriptions	of	the	net	income	impacts	in	the	condensed	consolidated	statement	of	income	for	the	nine	months	ended	September	29,	2018	section	above.

The	misstatements	in	the	capital	leases	misclassifications	category	resulted	in	a	decrease	to	net	cash	flows	provided	by	operating	activities	of	$21	million	and	a	decrease to	net	cash	flows	used	for	financing	activities	of	$21	million	for	the	nine	months	ended	September	29,	2018.

The	misstatements	in	the	other	misclassifications	category	resulted	in	a	decrease	to	net	cash	flows	provided	by	operating	activities	of	less	than	$1	million	and	a	decrease to	net	cash	flows	used	for	financing	activities	of	less	than	$1	million	for	the	nine	months	ended	September	29,	2018.

No	other	misstatements	impacted	the	classifications	between	net	operating,	net	investing,	or	net	financing	cash	flow	activities	for	the	nine	months	ended	September	29, 2018.

|  |  | For	the	Six	Months	Ended	June	30,	2018 | For	the	Six	Months	Ended	June	30,	2018 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | \t Restatement\tImpacts | Restatement\nReference | As\tRestated |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES: |  |  |  |  |
| Net\tincome/(loss) | $1,748 | $8 | (a)(b)(e)(f)(g) | $1,756 |
| Adjustments\tto\treconcile\tnet\tincome/(loss)\tto\toperating\tcash\tflows: |  |  |  |  |
| Depreciation\tand\tamortization | 476 | (14) | (b)(g) | 462 |
| Amortization\tof\tpostretirement\tbenefit\tplans\tprior\tservice\tcosts/(credits) | (183) | — |  | (183) |
| Equity\taward\tcompensation\texpense | 27 | — |  | 27 |
| Deferred\tincome\ttax\tprovision/(benefit) | 58 | 21 | (a)(e)(f)(g) | 79 |
| Postemployment\tbenefit\tplan\tcontributions | (60) | — |  | (60) |
| Goodwill\tand\tintangible\tasset\timpairment\tlosses | 265 | (31) | (f) | 234 |
| Nonmonetary\tcurrency\tdevaluation | 67 | — |  | 67 |
| Other\titems,\tnet | 59 | (32) | (a)(g) | 27 |
| Changes\tin\tcurrent\tassets\tand\tliabilities: |  |  |  |  |
| Trade\treceivables | (2,001) | — |  | (2,001) |
| Inventories | (440) | 12 | (d)(g) | (428) |
| Accounts\tpayable | 143 | (16) | (g) | 127 |
| Other\tcurrent\tassets | (66) | 22 | (a)(d)(g) | (44) |
| Other\tcurrent\tliabilities | 136 | 17 | (a)(b)(e)(g) | 153 |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | 229 | (13) |  | 216 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES: |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | 1,221 | — |  | 1,221 |
| Capital\texpenditures | (438) | — |  | (438) |
| Payments\tto\tacquire\tbusiness,\tnet\tof\tcash\tacquired | (215) | — |  | (215) |
| Other\tinvesting\tactivities,\tnet | 11 | — |  | 11 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 579 | — |  | 579 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES: |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | (25) | 13 | (b)(g) | (12) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | 2,990 | — |  | 2,990 |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | 1,525 | — |  | 1,525 |
| Repayments\tof\tcommercial\tpaper | (1,950) | — |  | (1,950) |
| Dividends\tpaid\t-\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Dividends\tpaid\t-\tcommon\tstock | (1,659) | — |  | (1,659) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Other\tfinancing\tactivities,\tnet | (3) | — |  | (3) |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | 878 | 13 |  | 891 |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\tcash | (80) | — |  | (80) |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash |  |  |  |  |
| Net\tincrease/(decrease) | 1,606 | — |  | 1,606 |
| Balance\tat\tbeginning\tof\tperiod | 1,769 | — |  | 1,769 |
| Balance\tat\tend\tof\tperiod | $3,375 | $— |  | $3,375 |
| NON-CASH\tINVESTING\tACTIVITIES: |  |  |  |  |
| Beneficial\tinterest\tobtained\tin\texchange\tfor\tsecuritized\ttrade\treceivables | $899 | $— |  | $899 |

See	descriptions	of	the	net	income	impacts	in	the	condensed	consolidated	statement	of	income	for	the	six	months	ended	June	30,	2018	section	above.

The	misstatements	in	the	capital	leases	misclassifications	category	resulted	in	a	decrease	to	net	cash	flows	provided	by	operating	activities	of	$13	million	and	an	increase to	net	cash	flows	provided	by	financing	activities	of	$13	million	for	the	six	months	ended	June	30,	2018.

The	misstatements	in	the	other	misclassifications	category	resulted	in	a	decrease	to	net	cash	flows	provided	by	operating	activities	of	less	than	$1	million	and	an	increase to	net	cash	flows	provided	by	financing	activities	of	less	than	$1	million	for	the	six	months	ended	June	30,	2018.

No	other	misstatements	impacted	the	classifications	between	net	operating,	net	investing,	or	net	financing	cash	flow	activities	for	the	six	months	ended	June	30,	2018.

|  |  | For	the	Three	Months	Ended	March	31,	2018 | For	the	Three	Months	Ended	March	31,	2018 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | \t Restatement\tImpacts | Restatement\nReference | As\tRestated |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES: |  |  |  |  |
| Net\tincome/(loss) | $993 | $10 | (a)(b)(e)(f)(g) | $1,003 |
| Adjustments\tto\treconcile\tnet\tincome/(loss)\tto\toperating\tcash\tflows: |  |  |  |  |
| Depreciation\tand\tamortization | 234 | (7) | (b)(g) | 227 |
| Amortization\tof\tpostretirement\tbenefit\tplans\tprior\tservice\tcosts/(credits) | (106) | — |  | (106) |
| Equity\taward\tcompensation\texpense | 7 | — |  | 7 |
| Deferred\tincome\ttax\tprovision/(benefit) | (47) | 1 | (a)(e)(f) | (46) |
| Postemployment\tbenefit\tplan\tcontributions | (22) | — |  | (22) |
| Goodwill\tand\tintangible\tasset\timpairment\tlosses | — | — | (f) | — |
| Nonmonetary\tcurrency\tdevaluation | 47 | — |  | 47 |
| Other\titems,\tnet | 5 | (27) | (a)(g) | (22) |
| Changes\tin\tcurrent\tassets\tand\tliabilities: |  |  |  |  |
| Trade\treceivables | (712) | — |  | (712) |
| Inventories | (312) | — | (d)(g) | (312) |
| Accounts\tpayable | (69) | (16) | (g) | (85) |
| Other\tcurrent\tassets | 9 | 17 | (a)(d)(g) | 26 |
| Other\tcurrent\tliabilities | 386 | 17 | (a)(b)(e)(g) | 403 |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | 413 | (5) |  | 408 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES: |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | 436 | — |  | 436 |
| Capital\texpenditures | (223) | — |  | (223) |
| Payments\tto\tacquire\tbusiness,\tnet\tof\tcash\tacquired | (215) | — |  | (215) |
| Other\tinvesting\tactivities,\tnet | 6 | — |  | 6 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 4 | — |  | 4 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES: |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | (11) | 5 | (b)(g) | (6) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | — | — |  | — |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | 1,524 | — |  | 1,524 |
| Repayments\tof\tcommercial\tpaper | (1,006) | — |  | (1,006) |
| Dividends\tpaid\t-\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Dividends\tpaid\t-\tcommon\tstock | (897) | — |  | (897) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Other\tfinancing\tactivities,\tnet | 14 | — |  | 14 |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (376) | 5 |  | (371) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\tcash | (10) | — |  | (10) |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash |  |  |  |  |
| Net\tincrease/(decrease) | 31 | — |  | 31 |
| Balance\tat\tbeginning\tof\tperiod | 1,769 | — |  | 1,769 |
| Balance\tat\tend\tof\tperiod | $1,800 | $— |  | $1,800 |
| NON-CASH\tINVESTING\tACTIVITIES: |  |  |  |  |
| Beneficial\tinterest\tobtained\tin\texchange\tfor\tsecuritized\ttrade\treceivables | $613 | $— |  | $613 |

See	descriptions	of	the	net	income	impacts	in	the	condensed	consolidated	statement	of	income	for	the	three	months	ended	March	31,	2018	section	above.

The	misstatements	in	the	capital	leases	misclassifications	category	resulted	in	a	decrease	to	net	cash	flows	provided	by	operating	activities	of	$5	million	and	a	decrease	to net	cash	flows	used	for	financing	activities	of	$5	million	for	the	three	months	ended	March	31,	2018.

The	misstatements	in	the	other	misclassifications	category	resulted	in	a	decrease	to	net	cash	flows	provided	by	operating	activities	of	less	than	$1	million	and	a	decrease to	net	cash	flows	used	for	financing	activities	of	less	than	$1	million	for	the	three	months	ended	March	31,	2018.

No	other	misstatements	impacted	the	classifications	between	net	operating,	net	investing,	or	net	financing	cash	flow	activities	for	the	three	months	ended	March	31, 2018.

|  |  | For	the	Nine	Months	Ended	September	30,	2017 | For	the	Nine	Months	Ended	September	30,	2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES: |  |  |  |  |
| Net\tincome/(loss) | $2,994 | $(44) | (a)(e)(f)(g) | $2,950 |
| Adjustments\tto\treconcile\tnet\tincome/(loss)\tto\toperating\tcash\tflows: |  |  |  |  |
| Depreciation\tand\tamortization | 790 | (1) | (g) | 789 |
| Amortization\tof\tpostretirement\tbenefit\tplans\tprior\tservice\tcosts/(credits) | (247) | — |  | (247) |
| Equity\taward\tcompensation\texpense | 36 | — |  | 36 |
| Deferred\tincome\ttax\tprovision/(benefit) | 492 | (60) | (a)(e)(f) | 432 |
| Postemployment\tbenefit\tplan\tcontributions | (283) | — |  | (283) |
| Goodwill\tand\tintangible\tasset\timpairment\tlosses | 49 | — | (f) | 49 |
| Nonmonetary\tcurrency\tdevaluation | 36 | — |  | 36 |
| Other\titems,\tnet | (52) | (10) | (a)(g) | (62) |
| Changes\tin\tcurrent\tassets\tand\tliabilities: |  |  |  |  |
| Trade\treceivables | (2,061) | — |  | (2,061) |
| Inventories | (580) | 13 | (d) | (567) |
| Accounts\tpayable | 123 | — |  | 123 |
| Other\tcurrent\tassets | (137) | 47 | (a)(d) | (90) |
| Other\tcurrent\tliabilities | (1,144) | 54 | (a)(g)(e) | (1,090) |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | 16 | (1) |  | 15 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES: |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | 1,633 | — |  | 1,633 |
| Capital\texpenditures | (956) | — |  | (956) |
| Payments\tto\tacquire\tbusiness,\tnet\tof\tcash\tacquired | — | — |  | — |
| Other\tinvesting\tactivities,\tnet | 47 | (2) | (g) | 45 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 724 | (2) |  | 722 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES: |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | (2,636) | 1 | (g) | (2,635) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | 1,496 | — |  | 1,496 |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | 5,495 | — |  | 5,495 |
| Repayments\tof\tcommercial\tpaper | (5,709) | — |  | (5,709) |
| Dividends\tpaid\t-\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Dividends\tpaid\t-\tcommon\tstock | (2,161) | — |  | (2,161) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Other\tfinancing\tactivities,\tnet | 26 | 2 | (g) | 28 |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (3,489) | 3 |  | (3,486) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\tcash | 43 | — |  | 43 |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash |  |  |  |  |
| Net\tincrease/(decrease) | (2,706) | — |  | (2,706) |
| Balance\tat\tbeginning\tof\tperiod | 4,255 | — |  | 4,255 |
| Balance\tat\tend\tof\tperiod | $1,549 | $— |  | $1,549 |
| NON-CASH\tINVESTING\tACTIVITIES: |  |  |  |  |
| Beneficial\tinterest\tobtained\tin\texchange\tfor\tsecuritized\ttrade\treceivables | $1,936 | $— |  | $1,936 |

See	descriptions	of	the	net	income	impacts	in	the	condensed	consolidated	statement	of	income	for	the	nine	months	ended	September	30,	2017	section	above.

The	misstatements	in	the	other	misclassification	category	resulted	in	a	decrease	to	net	cash	flows	provided	by	operating	activities	of	$1	million,	a	decrease	to	net	cash flows	provided	by	investing	activities	of	$2	million,	and	a	decrease	to	net	cash	flows	used	for	financing	activities	of	$3	million	for	the	nine	months	ended	September	30, 2017.

|  |  | For	the	Six	Months	Ended	July	1,	2017 | For	the	Six	Months	Ended	July	1,	2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES: |  |  |  |  |
| Net\tincome/(loss) | $2,051 | $(13) | (a)(e)(f)(g) | $2,038 |
| Adjustments\tto\treconcile\tnet\tincome/(loss)\tto\toperating\tcash\tflows: |  |  |  |  |
| Depreciation\tand\tamortization | 517 | — | (g) | 517 |
| Amortization\tof\tpostretirement\tbenefit\tplans\tprior\tservice\tcosts/(credits) | (171) | — |  | (171) |
| Equity\taward\tcompensation\texpense | 24 | — |  | 24 |
| Deferred\tincome\ttax\tprovision/(benefit) | 269 | (46) | (a)(e)(f) | 223 |
| Postemployment\tbenefit\tplan\tcontributions | (90) | — |  | (90) |
| Goodwill\tand\tintangible\tasset\timpairment\tlosses | 48 | — | (f) | 48 |
| Nonmonetary\tcurrency\tdevaluation | 33 | — |  | 33 |
| Other\titems,\tnet | (31) | (17) | (a)(g) | (48) |
| Changes\tin\tcurrent\tassets\tand\tliabilities: |  |  |  |  |
| Trade\treceivables | (1,598) | — |  | (1,598) |
| Inventories | (431) | 13 | (d) | (418) |
| Accounts\tpayable | 84 | — |  | 84 |
| Other\tcurrent\tassets | (121) | 18 | (a)(d) | (103) |
| Other\tcurrent\tliabilities | (762) | 45 | (a)(g)(e) | (717) |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | (178) | — |  | (178) |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES: |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | 1,069 | — |  | 1,069 |
| Capital\texpenditures | (690) | — |  | (690) |
| Payments\tto\tacquire\tbusiness,\tnet\tof\tcash\tacquired | — | — |  | — |
| Other\tinvesting\tactivities,\tnet | 44 | — |  | 44 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 423 | — |  | 423 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES: |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | (2,032) | — | (g) | (2,032) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | 4 | — |  | 4 |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | 4,213 | — |  | 4,213 |
| Repayments\tof\tcommercial\tpaper | (3,777) | — |  | (3,777) |
| Dividends\tpaid\t-\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Dividends\tpaid\t-\tcommon\tstock | (1,434) | — |  | (1,434) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Other\tfinancing\tactivities,\tnet | 15 | — |  | 15 |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (3,011) | — |  | (3,011) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\tcash | 29 | — |  | 29 |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash |  |  |  |  |
| Net\tincrease/(decrease) | (2,737) | — |  | (2,737) |
| Balance\tat\tbeginning\tof\tperiod | 4,255 | — |  | 4,255 |
| Balance\tat\tend\tof\tperiod | $1,518 | $— |  | $1,518 |
| NON-CASH\tINVESTING\tACTIVITIES: |  |  |  |  |
| Beneficial\tinterest\tobtained\tin\texchange\tfor\tsecuritized\ttrade\treceivables | $1,407 | $— |  | $1,407 |

See	descriptions	of	the	net	income	impacts	in	the	condensed	consolidated	statement	of	income	for	the	six	months	ended	July	1,	2017	section	above.

No	misstatements	impacted	the	classifications	between	net	operating,	net	investing,	or	net	financing	cash	flow	activities	for	the	six	months	ended	July	1,	2017.

|  |  | For	the	Three	Months	Ended	April	1,	2017 | For	the	Three	Months	Ended	April	1,	2017 |  |
| :--- | :--- | :--- | :--- | :--- |
|  | As\tPreviously\nReported | Restatement\nImpacts | Restatement\nReference | As\tRestated |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES: |  |  |  |  |
| Net\tincome/(loss) | $891 | $(10) | (a)(e)(f)(g) | $881 |
| Adjustments\tto\treconcile\tnet\tincome/(loss)\tto\toperating\tcash\tflows: |  |  |  |  |
| Depreciation\tand\tamortization | 262 | — | (g) | 262 |
| Amortization\tof\tpostretirement\tbenefit\tplans\tprior\tservice\tcosts/(credits) | (82) | — |  | (82) |
| Equity\taward\tcompensation\texpense | 11 | — |  | 11 |
| Deferred\tincome\ttax\tprovision/(benefit) | 105 | (37) | (a)(e)(f) | 68 |
| Postemployment\tbenefit\tplan\tcontributions | (38) | — |  | (38) |
| Goodwill\tand\tintangible\tasset\timpairment\tlosses | — | — | (f) | — |
| Nonmonetary\tcurrency\tdevaluation | 8 | — |  | 8 |
| Other\titems,\tnet | 35 | 5 | (a) | 40 |
| Changes\tin\tcurrent\tassets\tand\tliabilities: |  |  |  |  |
| Trade\treceivables | (1,040) | — |  | (1,040) |
| Inventories | (492) | 17 | (d) | (475) |
| Accounts\tpayable | 62 | — |  | 62 |
| Other\tcurrent\tassets | (67) | (5) | (a)(d) | (72) |
| Other\tcurrent\tliabilities | (270) | 30 | (a)(g)(e) | (240) |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | (615) | — |  | (615) |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES: |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | 464 | — |  | 464 |
| Capital\texpenditures | (368) | — |  | (368) |
| Payments\tto\tacquire\tbusiness,\tnet\tof\tcash\tacquired | — | — |  | — |
| Other\tinvesting\tactivities,\tnet | 38 | — |  | 38 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 134 | — |  | 134 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES: |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | (27) | — | (g) | (27) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | 2 | — |  | 2 |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | 2,324 | — |  | 2,324 |
| Repayments\tof\tcommercial\tpaper | (2,068) | — |  | (2,068) |
| Dividends\tpaid\t-\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Dividends\tpaid\t-\tcommon\tstock | (736) | — |  | (736) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | — | — |  | — |
| Other\tfinancing\tactivities,\tnet | — | — |  | — |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (505) | — |  | (505) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\tcash | 13 | — |  | 13 |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash |  |  |  |  |
| Net\tincrease/(decrease) | (973) | — |  | (973) |
| Balance\tat\tbeginning\tof\tperiod | 4,255 | — |  | 4,255 |
| Balance\tat\tend\tof\tperiod | $3,282 | $— |  | $3,282 |
| NON-CASH\tINVESTING\tACTIVITIES: |  |  |  |  |
| Beneficial\tinterest\tobtained\tin\texchange\tfor\tsecuritized\ttrade\treceivables | $880 | $— |  | $880 |

See	descriptions	of	the	net	income	impacts	in	the	condensed	consolidated	statement	of	income	for	the	three	months	ended	April	1,	2017	section	above.

No	misstatements	impacted	the	classifications	between	net	operating,	net	investing,	or	net	financing	cash	flow	activities	for	the	three	months	ended	April	1,	2017.

The	following	tables	represent	restated	Segment	Adjusted	EBITDA	for	the	interim	periods	within	fiscal	years	2018	and	2017.	Management	uses	Segment	Adjusted EBITDA	to	evaluate	segment	performance	and	allocate	resources.	See	Note	22,	Segment	Reporting,	for	the	definition	of	Segment	Adjusted	EBITDA.

|  | December	29,	2018 | September	29,<br>2018 |  | June	30,<br>2018 |  | March	31,<br>2018 |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Three\tMonths\nEnded | Three\tMonths\nEnded | Nine\tMonths\tEnded | Three\tMonths\nEnded | Six\tMonths\tEnded | Three\tMonths\nEnded |
|  |  |  | (in\tmillions) |  |  |  |
| Segment\tAdjusted\tEBITDA: |  |  |  |  |  |  |
| United\tStates | $1,249 | $1,176 | $3,969 | $1,401 | $2,793 | $1,392 |
| Canada | 157 | 144 | 451 | 173 | 307 | 134 |
| EMEA | 171 | 165 | 553 | 206 | 388 | 182 |
| Rest\tof\tWorld | 130 | 148 | 505 | 213 | 357 | 144 |
| General\tcorporate\texpenses | (33) | (39) | (128) | (44) | (89) | (45) |
| Depreciation\tand\tamortization\t(excluding\nintegration\tand\trestructuring\texpenses) | (240) | (245) | (679) | (235) | (434) | (199) |
| Integration\tand\trestructuring\texpenses | (82) | (32) | (215) | (93) | (183) | (90) |
| Deal\tcosts | (4) | (3) | (19) | (7) | (16) | (9) |
| Unrealized\tgains/(losses)\ton\tcommodity\thedges | (10) | (6) | (11) | (3) | (5) | (2) |
| Impairment\tlosses | (15,485) | (217) | (451) | (234) | (234) | — |
| Gains/(losses)\ton\tsale\tof\tbusiness | — | — | (15) | (15) | (15) | — |
| Equity\taward\tcompensation\texpense\t(excluding\nintegration\tand\trestructuring\texpenses) | 11 | (17) | (44) | (20) | (27) | (7) |
| Operating\tincome/(loss) | (14,136) | 1,074 | 3,916 | 1,342 | 2,842 | 1,500 |
| Interest\texpense | 325 | 326 | 959 | 316 | 633 | 317 |
| Other\texpense/(income),\tnet | 13 | (71) | (196) | (35) | (125) | (90) |
| Income/(loss)\tbefore\tincome\ttaxes | $(14,474) | $819 | $3,153 | $1,061 | $2,334 | $1,273 |

|  | December	30,	2017 | September	30,<br>2017 |  | July	1,<br>2017 |  | April	1,<br>2017 |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | Three\tMonths\nEnded | Three\tMonths\nEnded | Nine\tMonths\tEnded | Three\tMonths\nEnded | Six\tMonths\tEnded | Three\tMonths\nEnded |
|  |  |  | (in\tmillions) |  |  |  |
| Segment\tAdjusted\tEBITDA: |  |  |  |  |  |  |
| United\tStates | $1,486 | $1,407 | $4,387 | $1,534 | $2,980 | $1,446 |
| Canada | 159 | 159 | 477 | 189 | 318 | 129 |
| EMEA | 174 | 179 | 499 | 182 | 320 | 138 |
| Rest\tof\tWorld | 142 | 134 | 448 | 170 | 314 | 144 |
| General\tcorporate\texpenses | (14) | (29) | (94) | (36) | (65) | (29) |
| Depreciation\tand\tamortization\t(excluding\nintegration\tand\trestructuring\texpenses) | (224) | (243) | (683) | (219) | (440) | (221) |
| Integration\tand\trestructuring\texpenses | (208) | (108) | (375) | (132) | (267) | (135) |
| Unrealized\tgains/(losses)\ton\tcommodity\thedges | 5 | 5 | (24) | 13 | (29) | (42) |
| Impairment\tlosses | — | (1) | (49) | (48) | (48) | — |
| Equity\taward\tcompensation\texpense\t(excluding\nintegration\tand\trestructuring\texpenses) | (11) | (12) | (38) | (14) | (26) | (12) |
| Operating\tincome/(loss) | 1,509 | 1,491 | 4,548 | 1,639 | 3,057 | 1,418 |
| Interest\texpense | 308 | 306 | 926 | 307 | 620 | 313 |
| Other\texpense/(income),\tnet | (116) | (127) | (511) | (254) | (384) | (130) |
| Income/(loss)\tbefore\tincome\ttaxes | $1,317 | $1,312 | $4,133 | $1,586 | $2,821 | $1,235 |

# Note	24.	Supplemental	Guarantor	Information

# Restatement	of	Previously	Issued	Condensed	Consolidating	Financial	Statements

We	 have	 restated	 herein	 our	 previously	 issued	 condensed	 consolidating	 financial	 statements	 for	 fiscal	 years	 2017	 and	 2016.	 Following	 the	 restated	 condensed consolidating	financial	statement	tables,	we	have	presented	our	condensed	consolidating	financial	statements	as	previously	reported	for	fiscal	years	2017	and	2016, which	were	derived	from	our	Annual	Report	on	Form	10-K	for	the	fiscal	year	ended	December	30,	2017	filed	on	February	16,	2018.	See	Note	2,	Restatement	of Previously	Issued	Consolidated	Financial	Statements,	for	additional	information,	including	a	description	of	the	misstatements.

In	addition,	the	statements	of	income	for	fiscal	years	2017	and	2016,	as	previously	reported,	did	not	originally	reflect	the	adoption	of	ASU	2017-07	related	to	the presentation	of	net	periodic	benefit	cost	(pension	and	postretirement	cost).	This	ASU	was	adopted	in	the	first	quarter	of	2018	and	was	applied	retrospectively	for statement	of	income	presentation	of	service	cost	components	and	other	net	periodic	benefit	cost	components.	The	condensed	consolidating	statements	of	income	for	fiscal years	2017	and	2016	have	been	recast	accordingly.	See	Note	4,	New	Accounting	Standards,	for	additional	information	related	to	our	adoption	of	ASU	2017-07.

# Supplemental	Guarantor	Information

Kraft	Heinz	fully	and	unconditionally	guarantees	the	notes	issued	by	our	100%	owned	operating	subsidiary,	KHFC,	including	the	New	Notes.	See	Note	19,	Debt,	for additional	descriptions	of	these	guarantees.	None	of	our	other	subsidiaries	guarantee	these	notes.

Set	forth	below	are	the	condensed	consolidating	financial	statements	presenting	the	results	of	operations,	financial	position,	and	cash	flows	of	Kraft	Heinz	(as	parent guarantor),	KHFC	(as	subsidiary	issuer	of	the	notes),	and	the	non-guarantor	subsidiaries	on	a	combined	basis	and	eliminations	necessary	to	arrive	at	the	total	reported information	on	a	consolidated	basis.	This	condensed	consolidating	financial	information	has	been	prepared	and	presented	pursuant	to	the	Securities	and	Exchange Commission	Regulation	S-X	Rule	3-10,	"Financial	Statements	of	Guarantors	and	Issuers	of	Guaranteed	Securities	Registered	or	being	Registered."	This	information	is not	intended	to	present	the	financial	position,	results	of	operations,	and	cash	flows	of	the	individual	companies	or	groups	of	companies	in	accordance	with	U.S.	GAAP. Eliminations	 represent	 adjustments	 to	 eliminate	 investments	 in	 subsidiaries	 and	 intercompany	 balances	 and	 transactions	 between	 or	 among	 the	 parent	 guarantor, subsidiary	issuer,	and	the	non-guarantor	subsidiaries.

# Condensed	Consolidating	Statements	of	Income

|  | Parent	Guarantor | Subsidiary	Issuer | Non-Guarantor<br>Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Net\tsales | $— | $17,317 | $9,481 | $(530) | $26,268 |
| Cost\tof\tproducts\tsold | — | 11,290 | 6,587 | (530) | 17,347 |
| Gross\tprofit | — | 6,027 | 2,894 | — | 8,921 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\timpairment\tlosses | — | 803 | 2,402 | — | 3,205 |
| Goodwill\timpairment\tlosses | — | — | 7,008 | — | 7,008 |
| Intangible\tasset\timpairment\tlosses | — | — | 8,928 | — | 8,928 |
| Selling,\tgeneral\tand\tadministrative\texpenses | — | 803 | 18,338 | — | 19,141 |
| Intercompany\tservice\tfees\tand\tother\trecharges | — | 3,865 | (3,865) | — | — |
| Operating\tincome/(loss) | — | 1,359 | (11,579) | — | (10,220) |
| Interest\texpense | — | 1,212 | 72 | — | 1,284 |
| Other\texpense/(income),\tnet | — | (359) | 176 | — | (183) |
| Income/(loss)\tbefore\tincome\ttaxes | — | 506 | (11,827) | — | (11,321) |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | — | 112 | (1,179) | — | (1,067) |
| Equity\tin\tearnings/(losses)\tof\tsubsidiaries | (10,192) | (10,586) | — | 20,778 | — |
| Net\tincome/(loss) | (10,192) | (10,192) | (10,648) | 20,778 | (10,254) |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | — | — | (62) | — | (62) |
| Net\tincome/(loss)\texcluding\tnoncontrolling\tinterest | $(10,192) | $(10,192) | $(10,586) | $20,778 | $(10,192) |
| Comprehensive\tincome/(loss)\texcluding\tnoncontrolling\tinterest | $(11,081) | $(11,081) | $(11,550) | $22,631 | $(11,081) |

|  | Parent	Guarantor | Subsidiary	Issuer | Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Net\tsales | $— | $17,397 | $9,247 | $(568) | $26,076 |
| Cost\tof\tproducts\tsold | — | 11,147 | 6,464 | (568) | 17,043 |
| Gross\tprofit | — | 6,250 | 2,783 | — | 9,033 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\timpairment\tlosses | — | 695 | 2,232 | — | 2,927 |
| Goodwill\timpairment\tlosses | — | — | — | — | — |
| Intangible\tasset\timpairment\tlosses | — | — | 49 | — | 49 |
| Selling,\tgeneral\tand\tadministrative\texpenses | — | 695 | 2,281 | — | 2,976 |
| Intercompany\tservice\tfees\tand\tother\trecharges | — | 4,307 | (4,307) | — | — |
| Operating\tincome/(loss) | — | 1,248 | 4,809 | — | 6,057 |
| Interest\texpense | — | 1,189 | 45 | — | 1,234 |
| Other\texpense/(income),\tnet | — | (535) | (92) | — | (627) |
| Income/(loss)\tbefore\tincome\ttaxes | — | 594 | 4,856 | — | 5,450 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | — | (243) | (5,239) | — | (5,482) |
| Equity\tin\tearnings/(losses)\tof\tsubsidiaries | 10,941 | 10,104 | — | (21,045) | — |
| Net\tincome/(loss) | 10,941 | 10,941 | 10,095 | (21,045) | 10,932 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | — | — | (9) | — | (9) |
| Net\tincome/(loss)\texcluding\tnoncontrolling\tinterest | $10,941 | $10,941 | $10,104 | $(21,045) | $10,941 |
| Comprehensive\tincome/(loss)\texcluding\tnoncontrolling\tinterest | $11,516 | $11,516 | $7,711 | $(19,227) | $11,516 |

|  | Parent	Guarantor | Subsidiary	Issuer | Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Net\tsales | $— | $17,507 | $9,293 | $(568) | $26,232 |
| Cost\tof\tproducts\tsold | — | 10,710 | 6,387 | (568) | 16,529 |
| Gross\tprofit | — | 6,797 | 2,906 | — | 9,703 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\timpairment\tlosses | — | 652 | 2,229 | — | 2,881 |
| Goodwill\timpairment\tlosses | — | — | — | — | — |
| Intangible\tasset\timpairment\tlosses | — | — | 49 | — | 49 |
| Selling,\tgeneral\tand\tadministrative\texpenses | — | 652 | 2,278 | — | 2,930 |
| Intercompany\tservice\tfees\tand\tother\trecharges | — | 4,308 | (4,308) | — | — |
| Operating\tincome/(loss) | — | 1,837 | 4,936 | — | 6,773 |
| Interest\texpense | — | 1,190 | 44 | — | 1,234 |
| Other\texpense/(income),\tnet | — | (10) | 19 | — | 9 |
| Income/(loss)\tbefore\tincome\ttaxes | — | 657 | 4,873 | — | 5,530 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | — | (221) | (5,239) | — | (5,460) |
| Equity\tin\tearnings/(losses)\tof\tsubsidiaries | 10,999 | 10,121 | — | (21,120) | — |
| Net\tincome/(loss) | 10,999 | 10,999 | 10,112 | (21,120) | 10,990 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | — | — | (9) | — | (9) |
| Net\tincome/(loss)\texcluding\tnoncontrolling\tinterest | $10,999 | $10,999 | $10,121 | $(21,120) | $10,999 |
| Comprehensive\tincome/(loss)\texcluding\tnoncontrolling\tinterest | $11,573 | $11,573 | $7,726 | $(19,299) | $11,573 |

|  | Parent	Guarantor | Subsidiary	Issuer | Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Net\tsales | $— | $17,652 | $9,281 | $(633) | $26,300 |
| Cost\tof\tproducts\tsold | — | 11,359 | 6,428 | (633) | 17,154 |
| Gross\tprofit | — | 6,293 | 2,853 | — | 9,146 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\timpairment\nlosses | — | 1,053 | 2,474 | — | 3,527 |
| Goodwill\timpairment\tlosses | — | — | — | — | — |
| Intangible\tasset\timpairment\tlosses | — | — | 18 | — | 18 |
| Selling,\tgeneral\tand\tadministrative\texpenses | — | 1,053 | 2,492 | — | 3,545 |
| Intercompany\tservice\tfees\tand\tother\trecharges | — | 4,624 | (4,624) | — | — |
| Operating\tincome/(loss) | — | 616 | 4,985 | — | 5,601 |
| Interest\texpense | — | 1,076 | 58 | — | 1,134 |
| Other\texpense/(income),\tnet | — | (230) | (242) | — | (472) |
| Income/(loss)\tbefore\tincome\ttaxes | — | (230) | 5,169 | — | 4,939 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | — | (414) | 1,747 | — | 1,333 |
| Equity\tin\tearnings/(losses)\tof\tsubsidiaries | 3,596 | 3,412 | — | (7,008) | — |
| Net\tincome/(loss) | 3,596 | 3,596 | 3,422 | (7,008) | 3,606 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | — | — | 10 | — | 10 |
| Net\tincome/(loss)\texcluding\tnoncontrolling\tinterest | $3,596 | $3,596 | $3,412 | $(7,008) | $3,596 |
| Comprehensive\tincome/(loss)\texcluding\tnoncontrolling\tinterest | $2,583 | $2,583 | $5,712 | $(8,295) | $2,583 |

|  | Parent	Guarantor | Subsidiary	Issuer | Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Net\tsales | $— | $17,809 | $9,310 | $(632) | $26,487 |
| Cost\tof\tproducts\tsold | — | 11,156 | 6,377 | (632) | 16,901 |
| Gross\tprofit | — | 6,653 | 2,933 | — | 9,586 |
| Selling,\tgeneral\tand\tadministrative\texpenses,\texcluding\timpairment\nlosses | — | 970 | 2,474 | — | 3,444 |
| Goodwill\timpairment\tlosses | — | — | — | — | — |
| Intangible\tasset\timpairment\tlosses | — | — | — | — | — |
| Selling,\tgeneral\tand\tadministrative\texpenses | — | 970 | 2,474 | — | 3,444 |
| Intercompany\tservice\tfees\tand\tother\trecharges | — | 4,624 | (4,624) | — | — |
| Operating\tincome/(loss) | — | 1,059 | 5,083 | — | 6,142 |
| Interest\texpense | — | 1,076 | 58 | — | 1,134 |
| Other\texpense/(income),\tnet | — | 144 | (159) | — | (15) |
| Income/(loss)\tbefore\tincome\ttaxes | — | (161) | 5,184 | — | 5,023 |
| Provision\tfor/(benefit\tfrom)\tincome\ttaxes | — | (372) | 1,753 | — | 1,381 |
| Equity\tin\tearnings/(losses)\tof\tsubsidiaries | 3,632 | 3,421 | — | (7,053) | — |
| Net\tincome/(loss) | 3,632 | 3,632 | 3,431 | (7,053) | 3,642 |
| Net\tincome/(loss)\tattributable\tto\tnoncontrolling\tinterest | — | — | 10 | — | 10 |
| Net\tincome/(loss)\texcluding\tnoncontrolling\tinterest | $3,632 | $3,632 | $3,421 | $(7,053) | $3,632 |
| Comprehensive\tincome/(loss)\texcluding\tnoncontrolling\tinterest | $2,675 | $2,675 | $5,717 | $(8,392) | $2,675 |

# Condensed	Consolidating	Balance	Sheets

|  | Parent	Guarantor | Subsidiary	Issuer | Non-Guarantor<br>Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| ASSETS |  |  |  |  |  |
| Cash\tand\tcash\tequivalents | $— | $202 | $928 | $— | $1,130 |
| Trade\treceivables,\tnet | — | 933 | 1,196 | — | 2,129 |
| Receivables\tdue\tfrom\taffiliates | — | 870 | 341 | (1,211) | — |
| Income\ttaxes\treceivable | — | 701 | 9 | (558) | 152 |
| Inventories | — | 1,783 | 884 | — | 2,667 |
| Short-term\tlending\tdue\tfrom\taffiliates | — | 1,787 | 3,753 | (5,540) | — |
| Prepaid\texpenses | — | 198 | 202 | — | 400 |
| Other\tcurrent\tassets | — | 776 | 445 | — | 1,221 |
| Assets\theld\tfor\tsale | — | 75 | 1,301 | — | 1,376 |
| Total\tcurrent\tassets | — | 7,325 | 9,059 | (7,309) | 9,075 |
| Property,\tplant\tand\tequipment,\tnet | — | 4,524 | 2,554 | — | 7,078 |
| Goodwill | — | 11,067 | 25,436 | — | 36,503 |
| Investments\tin\tsubsidiaries | 51,657 | 67,867 | — | (119,524) | — |
| Intangible\tassets,\tnet | — | 3,010 | 46,458 | — | 49,468 |
| Long-term\tlending\tdue\tfrom\taffiliates | — | — | 2,000 | (2,000) | — |
| Other\tnon-current\tassets | — | 316 | 1,021 | — | 1,337 |
| TOTAL\tASSETS | $51,657 | $94,109 | $86,528 | $(128,833) | $103,461 |
| LIABILITIES\tAND\tEQUITY |  |  |  |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $— | $— | $21 | $— | $21 |
| Current\tportion\tof\tlong-term\tdebt | — | 363 | 14 | — | 377 |
| Short-term\tlending\tdue\tto\taffiliates | — | 3,753 | 1,787 | (5,540) | — |
| Trade\tpayables | — | 2,563 | 1,590 | — | 4,153 |
| Payables\tdue\tto\taffiliates | — | 341 | 870 | (1,211) | — |
| Accrued\tmarketing | — | 282 | 440 | — | 722 |
| Interest\tpayable | — | 394 | 14 | — | 408 |
| Other\tcurrent\tliabilities | — | 888 | 1,437 | (558) | 1,767 |
| Liabilities\theld\tfor\tsale | — | — | 55 | — | 55 |
| Total\tcurrent\tliabilities | — | 8,584 | 6,228 | (7,309) | 7,503 |
| Long-term\tdebt | — | 29,872 | 898 | — | 30,770 |
| Long-term\tborrowings\tdue\tto\taffiliates | — | 2,000 | 12 | (2,012) | — |
| Deferred\tincome\ttaxes | — | 1,314 | 10,888 | — | 12,202 |
| Accrued\tpostemployment\tcosts | — | 89 | 217 | — | 306 |
| Other\tnon-current\tliabilities | — | 593 | 309 | — | 902 |
| TOTAL\tLIABILITIES | — | 42,452 | 18,552 | (9,321) | 51,683 |
| Redeemable\tnoncontrolling\tinterest | — | — | 3 | — | 3 |
| Total\tshareholders'\tequity | 51,657 | 51,657 | 67,855 | (119,512) | 51,657 |
| Noncontrolling\tinterest | — | — | 118 | — | 118 |
| TOTAL\tEQUITY | 51,657 | 51,657 | 67,973 | (119,512) | 51,775 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $51,657 | $94,109 | $86,528 | $(128,833) | $103,461 |

|  | Parent	Guarantor | Subsidiary	Issuer | Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| ASSETS |  |  |  |  |  |
| Cash\tand\tcash\tequivalents | $— | $509 | $1,120 | $— | $1,629 |
| Trade\treceivables,\tnet | — | 91 | 830 | — | 921 |
| Receivables\tdue\tfrom\taffiliates | — | 716 | 240 | (956) | — |
| Dividends\tdue\tfrom\taffiliates | 135 | — | — | (135) | — |
| Sold\treceivables | — | — | 353 | — | 353 |
| Income\ttaxes\treceivable | — | 1,890 | 97 | (1,449) | 538 |
| Inventories | — | 1,790 | 970 | — | 2,760 |
| Short-term\tlending\tdue\tfrom\taffiliates | — | 1,598 | 3,816 | (5,414) | — |
| Prepaid\texpenses | — | 168 | 177 | — | 345 |
| Other\tcurrent\tassets | — | 359 | 296 | — | 655 |
| Total\tcurrent\tassets | 135 | 7,121 | 7,899 | (7,954) | 7,201 |
| Property,\tplant\tand\tequipment,\tnet | — | 4,591 | 2,470 | — | 7,061 |
| Goodwill | — | 11,068 | 33,757 | — | 44,825 |
| Investments\tin\tsubsidiaries | 65,863 | 80,345 | — | (146,208) | — |
| Intangible\tassets,\tnet | — | 3,222 | 56,210 | — | 59,432 |
| Long-term\tlending\tdue\tfrom\taffiliates | — | 1,700 | 2,029 | (3,729) | — |
| Other\tnon-current\tassets | — | 515 | 1,058 | — | 1,573 |
| TOTAL\tASSETS | $65,998 | $108,562 | $103,423 | $(157,891) | $120,092 |
| LIABILITIES\tAND\tEQUITY |  |  |  |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $— | $450 | $12 | $— | $462 |
| Current\tportion\tof\tlong-term\tdebt | — | 2,568 | 165 | — | 2,733 |
| Short-term\tlending\tdue\tto\taffiliates | — | 3,816 | 1,598 | (5,414) | — |
| Trade\tpayables | — | 2,681 | 1,681 | — | 4,362 |
| Payables\tdue\tto\taffiliates | — | 240 | 716 | (956) | — |
| Accrued\tmarketing | — | 236 | 453 | — | 689 |
| Interest\tpayable | — | 404 | 15 | — | 419 |
| Dividends\tdue\tto\taffiliates | — | 135 | — | (135) | — |
| Other\tcurrent\tliabilities | 135 | 565 | 2,238 | (1,449) | 1,489 |
| Total\tcurrent\tliabilities | 135 | 11,095 | 6,878 | (7,954) | 10,154 |
| Long-term\tdebt | — | 27,422 | 886 | — | 28,308 |
| Long-term\tborrowings\tdue\tto\taffiliates | — | 2,029 | 1,919 | (3,948) | — |
| Deferred\tincome\ttaxes | — | 1,182 | 12,857 | — | 14,039 |
| Accrued\tpostemployment\tcosts | — | 184 | 243 | — | 427 |
| Other\tnon-current\tliabilities | — | 787 | 301 | — | 1,088 |
| TOTAL\tLIABILITIES | 135 | 42,699 | 23,084 | (11,902) | 54,016 |
| Redeemable\tnoncontrolling\tinterest | — | — | 6 | — | 6 |
| Total\tshareholders'\tequity | 65,863 | 65,863 | 80,126 | (145,989) | 65,863 |
| Noncontrolling\tinterest | — | — | 207 | — | 207 |
| TOTAL\tEQUITY | 65,863 | 65,863 | 80,333 | (145,989) | 66,070 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $65,998 | $108,562 | $103,423 | $(157,891) | $120,092 |

|  | Parent	Guarantor | Subsidiary	Issuer | Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| ASSETS |  |  |  |  |  |
| Cash\tand\tcash\tequivalents | $— | $509 | $1,120 | $— | $1,629 |
| Trade\treceivables,\tnet | — | 91 | 830 | — | 921 |
| Receivables\tdue\tfrom\taffiliates | — | 716 | 207 | (923) | — |
| Dividends\tdue\tfrom\taffiliates | 135 | — | — | (135) | — |
| Sold\treceivables | — | — | 353 | — | 353 |
| Income\ttaxes\treceivable | — | 1,904 | 97 | (1,419) | 582 |
| Inventories | — | 1,846 | 969 | — | 2,815 |
| Short-term\tlending\tdue\tfrom\taffiliates | — | 1,598 | 3,816 | (5,414) | — |
| Prepaid\texpenses | — | 168 | 177 | — | 345 |
| Other\tcurrent\tassets | — | 325 | 296 | — | 621 |
| Total\tcurrent\tassets | 135 | 7,157 | 7,865 | (7,891) | 7,266 |
| Property,\tplant\tand\tequipment,\tnet | — | 4,577 | 2,543 | — | 7,120 |
| Goodwill | — | 11,067 | 33,757 | — | 44,824 |
| Investments\tin\tsubsidiaries | 66,034 | 80,426 | — | (146,460) | — |
| Intangible\tassets,\tnet | — | 3,222 | 56,227 | — | 59,449 |
| Long-term\tlending\tdue\tfrom\taffiliates | — | 1,700 | 2,029 | (3,729) | — |
| Other\tnon-current\tassets | — | 515 | 1,058 | — | 1,573 |
| TOTAL\tASSETS | $66,169 | $108,664 | $103,479 | $(158,080) | $120,232 |
| LIABILITIES\tAND\tEQUITY |  |  |  |  |  |
| Commercial\tpaper\tand\tother\tshort-term\tdebt | $— | $448 | $12 | $— | $460 |
| Current\tportion\tof\tlong-term\tdebt | — | 2,577 | 166 | — | 2,743 |
| Short-term\tlending\tdue\tto\taffiliates | — | 3,816 | 1,598 | (5,414) | — |
| Trade\tpayables | — | 2,718 | 1,731 | — | 4,449 |
| Payables\tdue\tto\taffiliates | — | 207 | 716 | (923) | — |
| Accrued\tmarketing | — | 236 | 444 | — | 680 |
| Interest\tpayable | — | 404 | 15 | — | 419 |
| Dividends\tdue\tto\taffiliates | — | 135 | — | (135) | — |
| Other\tcurrent\tliabilities | 135 | 473 | 2,192 | (1,419) | 1,381 |
| Total\tcurrent\tliabilities | 135 | 11,014 | 6,874 | (7,891) | 10,132 |
| Long-term\tdebt | — | 27,442 | 891 | — | 28,333 |
| Long-term\tborrowings\tdue\tto\taffiliates | — | 2,029 | 1,919 | (3,948) | — |
| Deferred\tincome\ttaxes | — | 1,245 | 12,831 | — | 14,076 |
| Accrued\tpostemployment\tcosts | — | 184 | 243 | — | 427 |
| Other\tnon-current\tliabilities | — | 716 | 301 | — | 1,017 |
| TOTAL\tLIABILITIES | 135 | 42,630 | 23,059 | (11,839) | 53,985 |
| Redeemable\tnoncontrolling\tinterest | — | — | 6 | — | 6 |
| Total\tshareholders'\tequity | 66,034 | 66,034 | 80,207 | (146,241) | 66,034 |
| Noncontrolling\tinterest | — | — | 207 | — | 207 |
| TOTAL\tEQUITY | 66,034 | 66,034 | 80,414 | (146,241) | 66,241 |
| TOTAL\tLIABILITIES\tAND\tEQUITY | $66,169 | $108,664 | $103,479 | $(158,080) | $120,232 |

# Condensed	Consolidating	Statements	of	Cash	Flows

|  | Parent	Guarantor | Subsidiary	Issuer | Non-Guarantor<br>Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES |  |  |  |  |  |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | $3,183 | $1,928 | $656 | $(3,193) | $2,574 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES |  |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | — | — | 1,296 | — | 1,296 |
| Capital\texpenditures | — | (339) | (487) | — | (826) |
| Payments\tto\tacquire\tbusiness,\tnet\tof\tcash\tacquired | — | (245) | (3) | — | (248) |
| Net\tproceeds\tfrom/(payments\ton)\tintercompany\tlending\tactivities | — | 1,626 | 206 | (1,832) | — |
| Additional\tinvestments\tin\tsubsidiaries |  | (41) |  | 41 | — |
| Return\tof\tcapital | 7 | — | — | (7) | — |
| Other\tinvesting\tactivities,\tnet | — | 31 | 35 | — | 66 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 7 | 1,032 | 1,047 | (1,798) | 288 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES |  |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | — | (2,550) | (163) | — | (2,713) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | — | 2,990 | — | — | 2,990 |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | — | 2,784 | — | — | 2,784 |
| Repayments\tof\tcommercial\tpaper | — | (3,213) | — | — | (3,213) |
| Net\tproceeds\tfrom/(payments\ton)\tintercompany\tborrowing\tactivities | — | (206) | (1,626) | 1,832 | — |
| Dividends\tpaid-common\tstock | (3,183) | (3,183) | (10) | 3,193 | (3,183) |
| Other\tintercompany\tcapital\tstock\ttransactions | — | (7) | 41 | (34) | — |
| Other\tfinancing\tactivities,\tnet | (7) | (17) | (4) | — | (28) |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (3,190) | (3,402) | (1,762) | 4,991 | (3,363) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\ncash | — | — | (132) | — | (132) |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash: |  |  |  |  |  |
| Net\tincrease/(decrease) | — | (442) | (191) | — | (633) |
| Balance\tat\tbeginning\tof\tperiod | — | 644 | 1,125 | — | 1,769 |
| Balance\tat\tend\tof\tperiod | $— | $202 | $934 | $— | $1,136 |

|  | Parent	Guarantor | Subsidiary	Issuer | Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES |  |  |  |  |  |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | $2,888 | $1,497 | $(996) | $(2,888) | $501 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES |  |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | — | — | 2,286 | — | 2,286 |
| Capital\texpenditures | — | (757) | (437) | — | (1,194) |
| Net\tproceeds\tfrom/(payments\ton)\tintercompany\tlending\tactivities | — | 641 | (542) | (99) | — |
| Additional\tinvestments\tin\tsubsidiaries | (21) | — | — | 21 | — |
| Other\tinvesting\tactivities,\tnet | — | 62 | 23 | — | 85 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | (21) | (54) | 1,330 | (78) | 1,177 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES |  |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | — | (2,628) | (13) | — | (2,641) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | — | 1,496 | — | — | 1,496 |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | — | 6,043 | — | — | 6,043 |
| Repayments\tof\tcommercial\tpaper | — | (6,249) | — | — | (6,249) |
| Net\tproceeds\tfrom/(payments\ton)\tintercompany\tborrowing\tactivities | — | 542 | (641) | 99 | — |
| Dividends\tpaid-common\tstock | (2,888) | (2,888) | — | 2,888 | (2,888) |
| Other\tintercompany\tcapital\tstock\ttransactions | — | 21 | — | (21) | — |
| Other\tfinancing\tactivities,\tnet | 21 | (5) | 2 | — | 18 |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (2,867) | (3,668) | (652) | 2,966 | (4,221) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\ncash | — | — | 57 | — | 57 |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash: |  |  |  |  |  |
| Net\tincrease/(decrease) | — | (2,225) | (261) | — | (2,486) |
| Balance\tat\tbeginning\tof\tperiod | — | 2,869 | 1,386 | — | 4,255 |
| Balance\tat\tend\tof\tperiod | $— | $644 | $1,125 | $— | $1,769 |

|  | Parent	Guarantor | Subsidiary	Issuer | Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES |  |  |  |  |  |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | $2,888 | $1,499 | $(972) | $(2,888) | $527 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES |  |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | — | — | 2,286 | — | 2,286 |
| Capital\texpenditures | — | (757) | (460) | — | (1,217) |
| Net\tproceeds\tfrom/(payments\ton)\tintercompany\tlending\tactivities | — | 641 | (542) | (99) | — |
| Additional\tinvestments\tin\tsubsidiaries | (22) | — | — | 22 | — |
| Other\tinvesting\tactivities,\tnet | — | 64 | 23 | — | 87 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | (22) | (52) | 1,307 | (77) | 1,156 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES |  |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | — | (2,632) | (12) | — | (2,644) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | — | 1,496 | — | — | 1,496 |
| Net\tproceeds\tfrom/(payments\ton)\tintercompany\tborrowing\tactivities | — | 542 | (641) | 99 | — |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | — | 6,043 | — | — | 6,043 |
| Repayments\tof\tcommercial\tpaper | — | (6,249) | — | — | (6,249) |
| Dividends\tpaid-common\tstock | (2,888) | (2,888) | — | 2,888 | (2,888) |
| Other\tintercompany\tcapital\tstock\ttransactions | — | 22 | — | (22) | — |
| Other\tfinancing\tactivities,\tnet | 22 | (6) | — | — | 16 |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (2,866) | (3,672) | (653) | 2,965 | (4,226) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\ncash | — | — | 57 | — | 57 |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash: |  |  |  |  |  |
| Net\tincrease/(decrease) | — | (2,225) | (261) | — | (2,486) |
| Balance\tat\tbeginning\tof\tperiod | — | 2,869 | 1,386 | — | 4,255 |
| Balance\tat\tend\tof\tperiod | $— | $644 | $1,125 | $— | $1,769 |

|  | Parent	Guarantor | Subsidiary	Issuer | Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES |  |  |  |  |  |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | $3,096 | $4,368 | $(1,704) | $(3,112) | $2,648 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES |  |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | — | — | 2,589 | — | 2,589 |
| Capital\texpenditures | — | (923) | (324) | — | (1,247) |
| Net\tproceeds\tfrom/(payments\ton)\tintercompany\tlending\tactivities | — | 690 | 37 | (727) | — |
| Additional\tinvestments\tin\tsubsidiaries | — | (10) | — | 10 | — |
| Return\tof\tcapital | 9,042 | — | — | (9,042) | — |
| Other\tinvesting\tactivities,\tnet | — | 129 | (19) | — | 110 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 9,042 | (114) | 2,283 | (9,759) | 1,452 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES |  |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | — | (72) | (13) | — | (85) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | — | 6,978 | 3 | — | 6,981 |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | — | 6,680 | — | — | 6,680 |
| Repayments\tof\tcommercial\tpaper | — | (6,043) | — | — | (6,043) |
| Net\tproceeds\tfrom/(payments\ton)\tintercompany\tborrowing\tactivities | — | (37) | (690) | 727 | — |
| Dividends\tpaid-Series\tA\tPreferred\tStock | (180) | — | — | — | (180) |
| Dividends\tpaid-common\tstock | (3,584) | (3,764) | (16) | 3,780 | (3,584) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | (8,320) | — | — | — | (8,320) |
| Other\tintercompany\tcapital\tstock\ttransactions | — | (8,374) | 10 | 8,364 | — |
| Other\tfinancing\tactivities,\tnet | (54) | (5) | (10) | — | (69) |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (12,138) | (4,637) | (716) | 12,871 | (4,620) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\ncash | — | — | (137) | — | (137) |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash: |  |  |  |  |  |
| Net\tincrease/(decrease) | — | (383) | (274) | — | (657) |
| Balance\tat\tbeginning\tof\tperiod | — | 3,252 | 1,660 | — | 4,912 |
| Balance\tat\tend\tof\tperiod | $— | $2,869 | $1,386 | $— | $4,255 |

|  | Parent	Guarantor | Subsidiary	Issuer | Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| CASH\tFLOWS\tFROM\tOPERATING\tACTIVITIES |  |  |  |  |  |
| Net\tcash\tprovided\tby/(used\tfor)\toperating\tactivities | $3,097 | $4,369 | $(1,705) | $(3,112) | $2,649 |
| CASH\tFLOWS\tFROM\tINVESTING\tACTIVITIES |  |  |  |  |  |
| Cash\treceipts\ton\tsold\treceivables | — | — | 2,589 | — | 2,589 |
| Capital\texpenditures | — | (923) | (324) | — | (1,247) |
| Net\tproceeds\tfrom/(payments\ton)\tintercompany\tlending\tactivities | — | 690 | 37 | (727) | — |
| Additional\tinvestments\tin\tsubsidiaries | 55 | (10) | — | (45) | — |
| Return\tof\tcapital | 8,987 | — | — | (8,987) | — |
| Other\tinvesting\tactivities,\tnet | — | 129 | (19) | — | 110 |
| Net\tcash\tprovided\tby/(used\tfor)\tinvesting\tactivities | 9,042 | (114) | 2,283 | (9,759) | 1,452 |
| CASH\tFLOWS\tFROM\tFINANCING\tACTIVITIES |  |  |  |  |  |
| Repayments\tof\tlong-term\tdebt | — | (72) | (14) | — | (86) |
| Proceeds\tfrom\tissuance\tof\tlong-term\tdebt | — | 6,978 | 3 | — | 6,981 |
| Net\tproceeds\tfrom/(payments\ton)\tintercompany\tborrowing\tactivities | — | (37) | (690) | 727 | — |
| Proceeds\tfrom\tissuance\tof\tcommercial\tpaper | — | 6,680 | — | — | 6,680 |
| Repayments\tof\tcommercial\tpaper | — | (6,043) | — | — | (6,043) |
| Dividends\tpaid-Series\tA\tPreferred\tStock | (180) | — | — | — | (180) |
| Dividends\tpaid-common\tstock | (3,584) | (3,764) | (16) | 3,780 | (3,584) |
| Redemption\tof\tSeries\tA\tPreferred\tStock | (8,320) | — | — | — | (8,320) |
| Other\tintercompany\tcapital\tstock\ttransactions | — | (8,374) | 10 | 8,364 | — |
| Other\tfinancing\tactivities,\tnet | (55) | (6) | (8) | — | (69) |
| Net\tcash\tprovided\tby/(used\tfor)\tfinancing\tactivities | (12,139) | (4,638) | (715) | 12,871 | (4,621) |
| Effect\tof\texchange\trate\tchanges\ton\tcash,\tcash\tequivalents,\tand\trestricted\ncash | — | — | (137) | — | (137) |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash: |  |  |  |  |  |
| Net\tincrease/(decrease) | — | (383) | (274) | — | (657) |
| Balance\tat\tbeginning\tof\tperiod | — | 3,252 | 1,660 | — | 4,912 |
| Balance\tat\tend\tof\tperiod | $— | $2,869 | $1,386 | $— | $4,255 |

The	following	tables	provide	a	reconciliation	of	cash	and	cash	equivalents,	as	reported	on	our	condensed	consolidating	balance	sheets,	to	cash,	cash	equivalents,	and restricted	cash,	as	reported	on	our	condensed	consolidating	statements	of	cash	flows	(in	millions):

|  | Parent	Guarantor | Subsidiary	Issuer | Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Cash\tand\tcash\tequivalents | $— | $202 | $928 | $— | $1,130 |
| Restricted\tcash\tincluded\tin\tother\tcurrent\tassets | — | — | 1 | — | 1 |
| Restricted\tcash\tincluded\tin\tother\tnon-current\tassets | — | — | 5 | — | 5 |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash | $— | $202 | $934 | $— | $1,136 |

|  | Parent	Guarantor | Subsidiary	Issuer | Subsidiaries | Eliminations | Consolidated |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Cash\tand\tcash\tequivalents | $— | $509 | $1,120 | $— | $1,629 |
| Restricted\tcash\tincluded\tin\tother\tcurrent\tassets | — | 135 | 5 | — | 140 |
| Cash,\tcash\tequivalents,\tand\trestricted\tcash | $— | $644 | $1,125 | $— | $1,769 |

# Item	9.	Changes	in	and	Disagreements	With	Accountants	on	Accounting	and	Financial	Disclosure.

# Item	9A.	Controls	and	Procedures.

# Evaluation	of	Disclosure	Controls	and	Procedures

Our	management,	with	the	participation	of	our	Chief	Executive	Officer	and	Chief	Financial	Officer,	has	evaluated	the	effectiveness	of	our	disclosure	controls	and procedures	(as	defined	in	Rules	13a-15(e)	and	15d-15(e)	under	the	Exchange	Act)	as	of	December	29,	2018.	Based	on	that	evaluation,	our	Chief	Executive	Officer	and Chief	Financial	Officer	have	concluded	that	as	of	December	29,	2018,	due	to	the	existence	of	the	material	weaknesses	in	our	internal	control	over	financial	reporting described	below,	our	disclosure	controls	and	procedures	were	not	effective	to	provide	reasonable	assurance	that	the	information	required	to	be	disclosed	in	the	reports that	we	file	or	submit	under	the	Exchange	Act	is	recorded,	processed,	summarized,	and	reported	within	the	time	periods	specified	in	the	SEC's	rules	and	forms,	and	that such	information	is	accumulated	and	communicated	to	management	as	appropriate	to	allow	timely	decisions	regarding	required	disclosure.

# Management's	Report	on	Internal	Control	Over	Financial	Reporting

Management	is	responsible	for	establishing	and	maintaining	adequate	internal	control	over	financial	reporting	as	defined	in	Rule	13a-15(f)	under	the	Exchange	Act.	Our internal	control	over	financial	reporting	is	a	process	designed	to	provide	reasonable	assurance	regarding	the	reliability	of	financial	reporting	and	the	preparation	of financial	statements	for	external	purposes	in	accordance	with	generally	accepted	accounting	principles.	Our	internal	control	over	financial	reporting	includes	those written	policies	and	procedures	that:

•pertain	to	the	maintenance	of	records	that,	in	reasonable	detail,	accurately	and	fairly	reflect	the	transactions	and	dispositions	of

assets;

•provide	reasonable	assurance	that	transactions	are	recorded	as	necessary	to	permit	preparation	of	financial	statements	in	accordance	with	generally	accepted accounting	principles;

•provide	reasonable	assurance	that	receipts	and	expenditures	are	being	made	only	in	accordance	with	management	and	director	authorization;

•provide	reasonable	assurance	regarding	prevention	or	timely	detection	of	unauthorized	acquisition,	use,	or	disposition	of	assets	that	could	have	a	material	effect on	the	consolidated	financial	statements.

Under	the	supervision	and	with	the	participation	of	management,	including	our	Chief	Executive	Officer	and	Chief	Financial	Officer,	we	conducted	an	evaluation	of	the effectiveness	of	our	internal	control	over	financial	reporting	as	of	December	29,	2018	based	on	the	framework	described	in	Internal	Control	-	Integrated	Framework (2013)	issued	by	the	Committee	of	Sponsoring	Organizations	of	the	Treadway	Commission	(COSO).	Based	on	this	evaluation,	our	management	concluded	that	we	did not	maintain	effective	internal	control	over	financial	reporting	as	of	December	29,	2018	due	to	the	material	weaknesses	described	below.

A	material	weakness	is	a	deficiency,	or	combination	of	deficiencies,	in	internal	control	over	financial	reporting,	such	that	there	is	a	reasonable	possibility	that	a	material misstatement	of	our	annual	or	interim	financial	statements	will	not	be	prevented	or	detected	on	a	timely	basis.

We	identified	a	material	weakness	in	the	risk	assessment	component	of	internal	control	as	we	did	not	appropriately	design	controls	in	response	to	the	risk	of	misstatement due	to	changes	in	our	business	environment.	This	material	weakness	in	risk	assessment	gave	rise	to	the	specific	control	deficiencies	described	below,	which	we	also determined	to	be	material	weaknesses:

•Supplier	Contracts	and	Related	Arrangements:	We	did	not	design	and	maintain	effective	controls	over	 the	accounting	for	supplier	contracts	and	related arrangements.	Specifically,	certain	employees	in	our	procurement	organization	engaged	in	misconduct	and	circumvented	controls	that	included	withholding information	or	directing	others	to	withhold	information	related	to	supplier	contracts	that	affected	the	accounting	for	certain	supplier	rebates,	incentives,	and pricing	arrangements,	in	an	attempt	to	influence	the	achievement	of	internal	financial	targets	that	became	or	were	perceived	to	have	become	increasingly difficult	to	attain	due	to	changes	in	our	business	environment.	Additionally,	in	certain	instances,	we	did	not	have	a	sufficient	understanding	or	maintain sufficient	documentation	of	the	transaction	to	determine	the	appropriate	accounting	for	certain	cost	and	rebate	elements	and	embedded	leases.	This	material weakness	resulted	in	misstatements	that	were	corrected	in	the	restatement	included	in	this	Annual	Report	on	Form	10-K.

•Goodwill	and	Indefinite-lived	Intangible	Asset	Impairment	Testing:	We	did	not	design	and	maintain	effective	controls	to	reassess	the	level	of	precision	used	to review	the	impairment	assessments	related	to	goodwill	and	indefinite-lived	intangible	assets	as	changes	in	our	business	environment	occurred.	Specifically,	we did	not	design	and	maintain	effective	controls	to	reassess	the	level	of	precision	used	in	the	review	of	the	allocation	of	cash	flow	projections	to	certain	brands used	as	a	basis	for	performing	our	fourth	quarter	2018	interim	impairment	assessments	in	response	to	the	significant	reduction	in,	and	in	certain	instances elimination	of,	the	excess	fair	value	over	carrying	amount	of	certain	brands	that	resulted	from	changes	in	our	business	environment.	This	material	weakness	did not	result	in	a	misstatement	of	any	previously	issued	consolidated	financial	statements.

Additionally,	the	material	weaknesses	described	above	could	result	in	a	misstatement	of	the	aforementioned	account	balances	or	disclosures	that	would	result	in	a material	misstatement	of	the	annual	or	interim	consolidated	financial	statements	that	would	not	be	prevented	or	detected.

PricewaterhouseCoopers	LLP,	an	independent	registered	public	accounting	firm	that	audited	the	consolidated	financial	statements	included	in	this	Annual	Report	on Form	10-K,	has	also	audited	the	effectiveness	of	our	internal	control	over	financial	reporting	as	of	December	29,	2018,	as	stated	in	their	report	which	appears	herein under	Item	8,	Financial	Statements	and	Supplementary	Data.

# Remediation	of	Material	Weaknesses

We	are	evaluating	the	material	weaknesses	and	developing	a	plan	of	remediation	to	strengthen	our	internal	controls	related	to	our	risk	assessment	component	of	internal control	over	financial	reporting,	supplier	contracts	and	related	arrangements,	and	the	level	of	precision	applied	to	the	goodwill	and	indefinite-lived	intangible	asset impairment	testing	process.	The	remediation	efforts	summarized	below,	which	are	in	the	process	of	being	implemented,	are	intended	to	address	the	identified	material weaknesses	and	enhance	our	overall	internal	control	environment.

•Personnel	Actions—A	comprehensive	disciplinary	plan	 is	 in	 the	process	of	being	 implemented	for	all	employees	found to	have	engaged in	misconduct, including	termination,	written	warnings,	and	appropriate	training	depending	on	the	severity	of	the	misconduct.

•Performance	Targets—We	have	identified	and	will	be	implementing	several	performance-based	target	enhancements	as	follows:	(i)	implementing	checkpoints to	evaluate	significant	changes	in	the	environment	that	could	adversely	impact	the	attainability	of	management	goals	and	targets;	(ii)	reassessing	and	adjusting the	overall	balance	of	performance	measures	provided	to	employees	to	help	drive	challenging	but	attainable	targets;	and	(iii)	enhancing	our	training	and	overall communication	specific	to	the	Management	by	Objective	("MBO")	process,	including	a	focus	on	the	process	to	request	relief	from	previously	established MBOs,	to	help	ensure	all	eligible	employees	are	aware	of	and	understand	the	overall	MBO	waiver	and	relief	process;	(iv)	reinforcing	the	importance	of adherence	to	established	internal	controls	and	company	policies	and	procedures	through	other	formal	communications,	town	hall	meetings,	and	other	employee trainings;	and	(v)	reassessing	certain	employees'	key	performance	indicators.

•Organizational	 Enhancements—We	 have	 identified	 and	 are	 in	 the	 process	 of	 implementing	 organizational	 enhancements	 as	 follows:	 (i)	 augmenting	 our procurement	finance	teams	with	additional	professionals	with	the	appropriate	levels	of	accounting	and	controls	knowledge,	experience,	and	training	in	the	area of	supplier	contracts	and	related	arrangements;	and	(ii)	realigning	reporting	lines	whereby	procurement	finance	now	report	directly	to	the	finance	organization.

•Procurement	Practices—We	have	evaluated	our	procurement	practices	and	are	in	the	process	of	implementing	improvements	to	those	practices,	including:	(i) developing	more	comprehensive	contract	approval	policies	and	processes;	(ii)	enhancing	required	communication	protocols	among	all	functions	involved	in	the procurement	 process	 (e.g.,	 procurement,	 legal,	 accounting,	 and	 finance)	 to	 ensure	 all	 relevant	 parties	 are	 involved	 in	 the	 contract	 review	 process;	 (iii) standardizing	contract	documentation	and	analyses;	and	(iv)	developing	a	more	comprehensive	accounting	review	process	and	monitoring	controls	over	supplier contracts	and	related	arrangements	to	ensure	transactions	are	recorded	in	accordance	with	generally	accepted	accounting	principles.

•Training	Practices—We	are	in	the	process	of	developing	a	comprehensive	global	procurement	training	program	that	will	cover	supplier	contracts	and	related arrangements,	including	potential	accounting	implications.	As	part	of	this	effort,	we	have	held	mandatory	training	for	our	global	procurement	function,	which focused	on	our	policies	and	procedures	related	to	procurement,	including	the	proper	accounting	for	the	contract	terms	that	contributed	to	the	material	weakness.

•Procurement	Management	Software—We	have	started	to	evaluate	potential	solutions	to	implement	or	upgrade	the	existing	procurement	management	software to	enhance	the	identification,	tracking,	and	monitoring	of	supplier	contracts	and	related	arrangements.

•Level	of	Precision	Applied	to	Impairment	Testing—We	are	in	the	process	of	implementing	a	plan	to	enhance	the	level	of	precision	at	which	our	internal controls	over	financial	reporting	relating	to	goodwill	and	indefinite-lived	intangible	asset	impairment	assessments	are	performed.	Specifically,	we	will	be implementing	and	executing	additional	procedures	to	(i)

enhance	our	analysis	of	forecasted	cash	flows	used	in	the	impairment	assessment	and	(ii)	test	the	accuracy	of	forecasted	cash	flow	allocations	to	specific	brands.

We	believe	the	measures	described	above	will	remediate	the	material	weaknesses	we	have	identified	and	strengthen	our	internal	control	over	financial	reporting.	We	are committed	to	continuing	to	improve	our	internal	control	processes	and	have	begun	to	implement	some	of	the	steps	described	above.	We	will	also	continue	to	review, optimize,	and	enhance	our	financial	reporting	controls	and	procedures.	As	we	continue	to	evaluate	and	work	to	improve	our	internal	control	over	financial	reporting,	we may	take	additional	measures	to	address	control	deficiencies	or	we	may	modify	certain	of	the	remediation	measures	described	above.	These	material	weaknesses	will	not be	considered	remediated	until	the	applicable	remediated	controls	operate	for	a	sufficient	period	of	time	and	management	has	concluded,	through	testing,	that	these controls	are	operating	effectively.

# Changes	in	Internal	Control	Over	Financial	Reporting

Our	Chief	Executive	Officer	and	Chief	Financial	Officer,	with	other	members	of	management,	evaluated	the	changes	in	our	internal	control	over	financial	reporting during	 the	 three	 months	 ended	 December	 29,	 2018.	We	 determined	 that	 there	 were	 no	 changes	 in	 our	 internal	 control	 over	 financial	 reporting	 during	 the	 three months	ended	December	29,	2018	that	have	materially	affected,	or	are	reasonably	likely	to	materially	affect,	our	internal	control	over	financial	reporting.

# Item	9B.	Other	Information.

# PART	III

# Item	10.	Directors,	Executive	Officers	and	Corporate	Governance.

# EXECUTIVE	OFFICERS

Information	regarding	executive	officers	is	included	in	Part	I	of	this	Annual	Report	on	Form	10-K	under	the	caption	"Information	about	our	Executive	Officers."

# BOARD	OF	DIRECTORS

# Directors	and	Director	Nominees

The	table	below	provides	summary	information	about	each	director	and	each	person	nominated	by	the	Kraft	Heinz	Board	of	Directors	(the	"Board")	for	election	at	our 2019	Annual	Meeting	of	Stockholders	(the	"Annual	Meeting")	as	of	June	5,	2019.

* As	previously	disclosed,	Marcel	Hermann	Telles	decided	to	retire	from	the	Board.	His	retirement	will	become	effective	on	June	12,	2019.	The	Board	elected	Mr.	Castro-Neves,	effective	June	12, 2019,	and	appointed	him	to	the	Compensation	Committee,	the	Nominating	and	Corporate	Governance	Committee	(the	"Governance	Committee"),	and	the	Operations	and	Strategy	Committee, effective	June	12,	2019.

**The	board	appointed	Mr.	Van	Damme	to	the	Governance	Committee,	effective	June	12,	2019.

Gregory	E.	Abel,	age	56,	has	served	on	our	Board	since	July	2015	and	previously	served	on	the	Heinz	board	from	June	2013	to	July	2015.	In	January	2018,	Mr.	Abel was	elected	 to	 the	Board	of	Directors	of	Berkshire	Hathaway	Inc.,	a	diversified	holding	company,	and	appointed	as	 its	Vice	Chairman,	Non-Insurance	Business Operations.	In	connection	with	this	election	in	January	2018,	Mr.	Abel	became	Executive	Chairman	of	the	Board	of	Directors	of	Berkshire	Hathaway	Energy	Company and	resigned	as	the	company's	Chief	Executive	Officer	and	President,	roles	that	he	had	held	since	2008	and	1998,	respectively.	He	had	previously	served	as	Chairman	of Berkshire	Hathaway	Energy	Company	since	2011.	Berkshire	Hathaway	Energy	Company	is	a	diversified	global	holding	company	that	owns	subsidiaries	principally engaged	in	energy	businesses	in	the	United	States,	Canada,	Great	Britain,	and	the	Philippines.

Until	January	2018,	Mr.	Abel	also	served	as	Chairman,	Chief	Executive	Officer,	and	Director	of	PacifiCorp,	an	electric	power	company,	as	Chairman,	President,	Chief Executive	Officer	and	Director	of	CE	Casecnan	Ltd.,	a	water	and	energy	company,	as	Chairman	and	Director	of	Northern	Natural	Gas	Company,	a	natural	gas	company, Northern	Powergrid	Holdings	Company,	an	electric	power	company,	and	NV	Energy,	Inc.,	a	public	utility	company,	as	Director	of	AltaLink	Management	Ltd.,	an electricity	transmission	company,	as	Director	and	Vice	Chairman	of	Edison	Electric	Institute,	an	association	of	U.S.	investor-owned	electric	companies,	and	as	Director of	Nuclear	Electric	Insurance	Limited,	a	mutual	insurance	company	of	nuclear	power	facilities.

Mr.	Abel	serves	as	Director	of	HomeServices	of	America,	Inc.,	a	residential	real	estate	brokerage	firm,	and	as	Director	and	Vice	Chairman	of	Associated	Electric	&	Gas Insurance	Services,	Inc.,	a	managing	general	agent	for	a	mutual	insurance	company.

Mr.	Abel	has	experience	as	chief	executive	officer	and	director	of	multiple	energy	companies.	Due	to	his	service	as	a	director	in	a	highly-regulated	industry	and	his management	experience,	he	provides	the	Board	with	strong	regulatory	and	operational	skills,	including	international	experience.

Alexandre	Behring,	age	52,	has	served	on	our	Board	as	Chairman	since	July	2015	and	previously	served	as	Chairman	of	the	Heinz	board	from	June	2013	to	July	2015. Mr.	Behring	is	a	Founding	Partner	and	has	been	Managing	Partner	and	a	board	member	of	3G	Capital,	a	global	investment	firm,	since	2004.	He	also	has	served	as	the Executive	Chairman	of	the	Board	of	Directors	of	Restaurant	Brands	International	Inc.	("RBI"),	the	parent	company	of	Burger	King,	Popeyes,	and	Tim	Hortons,	quick service	restaurant	companies,	since	December	2014.	Previously,	he	had	served	on	the	Board	of	Directors	of	Burger	King	Worldwide,	Inc.	and	its	predecessor	as Chairman	from	October	2010	until	December	2014.	Mr.	Behring	also	served	as	a	Director	of	AB	InBev,	a	multinational	drink	and	brewing	holdings	company,	from April	2014	to	April	2019.

Previously,	Mr.	Behring	spent	10	years	at	GP	Investments,	including	eight	years	as	a	partner	and	member	of	the	firm's	Investment	Committee.	He	served	for	seven	years, from	1998	through	2004,	as	Chief	Executive	Officer	of	ALL,	one	of	Latin	America's	largest	railroad	and	logistics	companies.	He	served	as	a	Director	of	ALL	until December	2011.	From	July	2008	to	May	2011,	Mr.	Behring	served	as	a	Director	of	CSX	Corporation,	a	U.S.	rail-based	transportation	company.

Mr.	Behring's	extensive	leadership	experience	in	developing	and	operating	both	public	and	private	companies	brings	an	important	perspective	and	ability	to	lead	and motivate.	Mr.	Behring's	qualifications	and	operational,	financial,	logistics,	and	strategic	skills	strengthen	the	Board's	collective	knowledge	and	capacities.

Joao	M.	Castro-Neves,	age	52,	has	served	on	our	Board	since	June	2019.	He	has	been	a	partner	with	3G	Capital	since	July	2018.	Previously,	Mr.	Castro-Neves	served as	Chief	Executive	Officer	of	Anheuser-Busch,	AB	InBev's	North	American	unit,	and	Zone	President,	North	America	of	AB	InBev,	from	January	2015	until	December 2017.	Mr.	Castro-Neves	joined	Companhia	de	Bebidas	das	Americas	S.A.	("AMBEV"),	a	predecessor	of	AB	InBev,	in	1996	and	served	in	positions	of	increasing responsibility,	including	Chief	Financial	Officer	from	January	2005	until	December	2006	and	Chief	Executive	Officer	from	January	2009	until	December	2014.	He	has also	served	as	Chief	Executive	Officer	of	Quilmes	Industrial	S.A.,	a	subsidiary	of	AMBEV	based	in	Argentina,	from	January	2007	until	December	2008.	Mr.	Castro- Neves	is	also	a	director	of	RBI.

The	Board	has	elected	Mr.	Castro-Neves	because	of	his	extensive	experience	in	the	consumer	goods	industry	in	his	various	positions	with	AB	InBev	as	well	as	his	public company	directorship	experience	at	RBI.	In	addition,	when	electing	him,	the	Board	considered	his	knowledge	of	strategy,	finance,	operations,	mergers	and	acquisitions, and	business	development.

Tracy	Britt	Cool,	age	34,	has	served	on	our	Board	since	July	2015	and	previously	served	on	the	Heinz	board	from	June	2013	to	July	2015.	Ms.	Cool	has	served	as	Chief Executive	Officer	of	The	Pampered	Chef,	a	direct	seller	of	high-quality	cooking	tools,	since	November	2014.	Ms.	Cool	has	been	with	Berkshire	Hathaway,	The Pampered	Chef's	parent	company,	since	she	joined	in	December	2009	as	Financial	Assistant	to	the	Chairman.	Ms.	Cool	is	currently	the	Chairman	of	Benjamin	Moore	& Co.,	a	leading	manufacturer	and	retailer	of	paints	and	architectural	coatings,	Chairman	of	Larson-Juhl,	a	manufacturer	and	distributor	of	wood	and	metal	framing products,	and	Chairman	of	Oriental	Trading	Company,	a	direct	merchant	of	party	suppliers,	arts	and	crafts,	toys,	and	novelties.	Ms.	Cool	is	also	a	director	of	Blue	Apron Holdings,	Inc.,	an	ingredient-and-recipe	meal	kit	service.

Ms.	Cool's	background	as	a	senior	leader	of	several	consumer	product	companies	provides	her	with	a	strong	fundamental	understanding	related	to	our	business.	She	also brings	important	insight	into	financial,	marketing,	product	development,	and	other	complex	subjects.

John	T.	Cahill,	age	62,	has	served	on	our	Board	as	Vice	Chairman	since	July	2015,	prior	to	which	he	had	served	as	Chairman	and	Chief	Executive	Officer	of	Kraft	since December	2014.	Mr.	Cahill	previously	served	as	Kraft's	non-executive	Chairman	from	March	2014	to	December	2014.	Prior	to	that,	he	served	as	Kraft's	Executive Chairman	since	October	2012.	Mr.	Cahill	joined	Mondelēz	International,	a	food	and	beverage	company	and	Kraft's	former	parent,	in	January	2012	as	the	Executive Chairman	Designate,	North	American	Grocery,	and	served	in	that	capacity	until	the	spin-off	of	Kraft	from	Mondelēz	International	in	October	2012.	Prior	to	that,	he served	as	an	Industrial	Partner	at	Ripplewood	Holdings	LLC,	a	private	equity	firm,	from	2008	to	2011.	Mr.	Cahill	spent	nine	years	with	The	Pepsi	Bottling	Group,	Inc.,	a beverage	manufacturing	company,	most	recently	as	Chairman	and	Chief	Executive	Officer	from	2003	to	2006	and	Executive	Chairman	until	2007.	Mr.	Cahill	previously spent	nine	years	with	PepsiCo,	Inc.,	a	food	and	beverage	company,	in	a	variety	of	leadership	positions.	He	currently	serves	as	Lead	Independent	Director	of	American Airlines	Group	and	is	also	a	director	at	Colgate-Palmolive	Company	and	a	former	director	of	Kraft	and	Legg	Mason,	Inc.

Mr.	Cahill	has	extensive	experience	in	the	food	and	beverage	industry,	having	served	as	Chairman	and	Chief	Executive	Officer	of	Kraft	and	in	various	key	roles	at	other food	 and	 beverage	 companies.	 Mr.	 Cahill	 brings	 global	 leadership,	 operating,	 marketing,	 and	 product	 development	 experience,	 as	 well	 as	 insight	 into	 corporate governance,	accounting,	and	financial	subjects.

Feroz	Dewan,	age	42,	has	served	on	our	Board	since	October	2016.	Mr.	Dewan	is	CEO	of	Arena	Holdings	Management	LLC,	an	investment	holding	company. Previously,	Mr.	Dewan	has	served	in	several	positions	with	Tiger	Global	Management,	an	investment	firm	with	approximately	$20	billion	under	management	across public	and	private	equity	funds,	from	2003	to	2015,	including	most	recently	as	Head	of	Public	Equities.	He	also	served	as	a	Private	Equity	Associate	at	Silver	Lake Partners,	a	private	equity	firm	focused	on	leveraged	buyout	and	growth	capital	investments	in	technology,	technology-enabled,	and	related	industries,	from	2002	to	2003. Mr.	Dewan	has	served	as	a	Director	of	Fortive	Corporation,	a	diversified	industrial	growth	company,	since	July	2016.

Mr.	Dewan	has	experience	with	technology	and	technology-related	companies,	including	extensive	experience	in	valuation,	investments,	financial	reporting,	capital allocation,	operational	oversight,	and	corporate	governance.

Jeanne	P.	Jackson,	age	67,	has	served	on	our	Board	since	July	2015	and	previously	served	on	the	Kraft	Board	of	Directors	from	October	2012	to	July	2015.	Ms. Jackson	served	as	President	and	Strategic	Advisor,	of	NIKE,	Inc.,	a	designer,	marketer,	and	distributor	of	athletic	footwear,	equipment,	and	accessories	from	June	2016 to	August	2017,	President,	Product	and	Merchandising	from	July	2013	until	April	2016,	and	President,	Direct	to	Consumer	from	2009	until	July	2013.	Prior	to	that,	she founded	and	served	as	the	Chief	Executive	Officer	of	MSP	Capital,	a	private	investment	company,	from	2002	to	2009,	a	role	she	returned	to	after	retiring	from	NIKE, Inc.	Before	MSP,	she	served	as	Chief	Executive	Officer	of	Walmart.com,	a	private	eCommerce	enterprise,	from	2000	to	2002.	Ms.	Jackson	previously	served	in	various leadership	positions	at	Gap	Inc.,	Victoria's	Secret,	Saks	Fifth	Avenue,	and	Federated	Department	Stores,	Inc.,	all	clothing	retailers,	and	Walt	Disney	Attractions,	Inc.,	the theme	parks	and	vacation	resorts	division	of	The	Walt	Disney	Company,	a	mass	media	company.	Ms.	Jackson	currently	serves	as	a	director	of	Delta	Airlines,	Inc.	and McDonald's	Corporation	and	was	formerly	a	director	of	Kraft.

As	a	former	senior	executive	with	several	major	consumer	retailers	and	service	as	audit	committee	member	of	several	public	companies,	Ms.	Jackson	brings	knowledge of	accounting	and	financial	subjects	as	well	as	leadership,	operating,	and	marketing	experience.

Jorge	Paulo	Lemann,	age	79,	has	served	on	our	Board	since	July	2015	and	previously	served	on	the	Heinz	board	from	June	2013	to	July	2015.	Mr.	Lemann	is	a Founding	Partner	and	has	been	a	board	member	of	3G	Capital	since	2004.	Mr.	Lemann	founded	and	was	Senior	Partner	of	Banco	de	Investimentos	Garantia	S.A.	in Brazil	from	1971	through	June	1998.	He	was	also	Chairman	of	the	Latin	American	Advisory	Committee	of	the	New	York	Stock	Exchange	and	formerly	a	Director	of AB	InBev.	Mr.	Lemann	has	been	a	member	of	JP	Morgan	International	Council	since	2012.

Mr.	Lemann	has	experience	as	a	director	of	a	consumer	products	company	and	has	strong international	experience in the	beverage industry.	He	also	has	broad knowledge	of	strategy,	financial,	investing,	and	business	development.

John	C.	Pope,	age	70,	has	served	on	our	Board	since	July	2015	and	previously	served	on	the	Kraft	Board	of	Directors	from	August	2012	to	July	2015.	Mr.	Pope	has served	as	Chairman	of	PFI	Group,	LLC,	a	financial	management	firm,	since	1994.	Mr.	Pope	also	serves	as	Chairman	of	the	board	of	R.R.	Donnelley	and	Sons	Co.,	a marketing	and	business	communication	company,	since	May	2014,	and	from	November	2004	 to	December	2011,	he	served	as	Chairman	of	 the	board	of	Waste Management,	Inc.,	a	provider	of	comprehensive	waste	management	services.	Mr.	Pope	also	served	as	Chairman	of	 the	board	of	MotivePower	Industries,	Inc.,	a manufacturer	and	remanufacturer	of	locomotives	and	locomotive	components,	from	December	1995	to	November	1999.	Prior	to	joining	MotivePower	Industries,	Inc., Mr.	Pope	served	in	various	capacities	at	United	Airlines,	a	U.S.-based	airline,	and	its	parent,	UAL	Corporation,	including	as	Director,	Vice	Chairman,	President,	Chief Operating	Officer,	Chief	Financial	Officer,	and	Executive	Vice	President,	Marketing	and	Finance.	Mr.	Pope	is	currently	Chairman	of	the	board	of	R.R.	Donnelley	and Sons	Co.	and	a	director	of	Talgo	S.A.,	a	railcar	manufacturer,	and	Waste	Management,	Inc.	Mr.	Pope	was	formerly	a	director	of	Con-way,	Inc.,	Dollar	Thrifty Automotive	Group,	Inc.,	Kraft,	Mondelēz	International,	and	Navistar	International	Corporation.

Mr.	Pope	has	served	as	Chairman	of	a	financial	management	firm	and	in	several	key	leadership	roles	at	global	companies,	including	as	Chief	Financial	Officer. Combined	with	his	experience	as	an	audit	committee	member	of	several	public	companies,	Mr.	Pope	brings	accounting	and	financial	expertise,	as	well	as	leadership, operating,	marketing,	and	international	experience.

Alexandre	Van	Damme,	age	57,	has	served	on	our	Board	since	April	2018	and	has	served	as	a	member	of	the	board	of	RBI	since	December	2014.	He	previously	served on	the	board	of	Burger	King	Worldwide,	Inc.	and	its	predecessor	from	December	2011	to	December	2014.	Mr.	Van	Damme	has	served	as	a	member	of	the	Board	of Directors	of	AB	InBev	since	1992.	He	held	various	operational	positions	within	Interbrew,	a	large	Belgian-based	brewing	company	until	1991.	Mr.	Van	Damme	was	also a	board	member	of	Jacobs	Douwe	Egberts	B.V.,	a	global	coffee	and	tea	company,	and	its	subsidiary	Keurig	Green	Mountain	through	May	2018.	He	is	also	a	director	of DKMS,	the	largest	bone	marrow	donor	center	in	the	world.

Mr.	Van	Damme's	long-term	leadership	at	a	large	brewing	company	that	is	a	major	consumer	brand	gives	him	valuable	expertise	in	business	development,	supply	chain management,	marketing,	finance,	risk	assessment,	and	strategy.

George	Zoghbi,	age	52,	has	served	on	our	Board	since	April	2018	and	currently	serves	as	a	Special	Advisor	at	Kraft	Heinz,	a	role	to	which	he	transitioned	in	October 2017	after	having	served	as	our	Chief	Operating	Officer	of	the	U.S.	Commercial	business	since	the	2015	Merger.	Mr.	Zoghbi	previously	held	key	leadership	roles	at Kraft,	including	Chief	Operating	Officer	from	February	2015	until	the	2015	Merger	and,	before	that,	as	Vice	Chairman,	Operations,	R&D,	Sales	and	Strategy	from	June 2014	until	February	2015,	Executive	Vice	President	and	President,	Cheese	&	Dairy	and	Exports	from	February	2013	until	June	2014,	and	Executive	Vice	President	and President,	Cheese	and	Dairy	from	October	2012	to	February	2013.	Prior	to	that,	he	served	as	President,	Cheese	and	Dairy	at	Mondelēz	International.	Prior	to	joining Kraft	in	2007,	Mr.	Zoghbi	held	a	number	of	roles	with	Fonterra	Cooperative,	a	multinational	dairy	cooperative,	and	Associated	British	Foods,	a	multinational	food processor	and	retailer.	Mr.	Zoghbi	currently	serves	as	a	director	of	Brambles	Limited,	a	global	supply	chain	logistics	company.

Mr.	Zoghbi	has	a	comprehensive	understanding	of,	and	a	unique	perspective	on,	the	Kraft	Heinz	business	and	the	food	and	beverage	markets	from	his	distinguished career	at	Kraft	Heinz	and	Kraft.	He	served	a	key	leadership	role	during	the	integration	of	Kraft	and	Heinz	and	has	extensive	experience	of	delivering	on	innovation, renovation,	and	new	consumer	trends.

# CORPORATE	GOVERNANCE	AND	BOARD	MATTERS

# Corporate	Governance	Guidelines

The	Guidelines	articulate	our	governance	philosophy,	practices,	and	policies	in	a	range	of	areas,	including:	the	Board's	role	and	responsibilities;	the	composition	and structure	of	the	Board;	the	establishment	and	responsibilities	of	the	committees	of	the	Board;	executive	and	director	performance	evaluations;	and	succession	planning. The	Governance	Committee	reviews	the	Guidelines	annually	and	recommends	any	changes	to	the	Board.

# Code	of	Business	Conduct	and	Ethics	for	Non-Employee	Directors	and	Code	of	Conduct	for	Employees

We	have	a	written	Code	of	Business	Conduct	and	Ethics	for	Non-Employee	Directors	(the	"Directors	Ethics	Code")	that	is	designed	to	deter	wrongdoing	and	to	promote: •honest	and	ethical	conduct;

•due	care,	diligence,	and	loyalty;

•confidentiality of our proprietary information;

•compliance	with	applicable	laws,	rules,	and	regulations,	including	insider	trading	compliance; and

•accountability for adherence to the	 Directors	 Ethics	 Code and prompt internal reporting of violations.

Annually,	each	non-employee	director	acknowledges	in	writing	that	he	or	she	has	received,	reviewed,	and	understands	the	Directors	Ethics	Code.

We	also	have	a	written	Code	of	Conduct	for	employees	(the	"Code	of	Conduct").	The	Code	of	Conduct	includes	a	set	of	employee	policies	that	cover	ethical	and	legal practices	for	nearly	every	aspect	of	our	business.	The	Code	of	Conduct	reflects	our	values	and	contains	important	rules	our	employees	must	follow	when	conducting business	to	promote	compliance	and	integrity.	The	Code	of	Conduct	is	part	of	our	global	compliance	and	integrity	program	that	provides	support	and	training	throughout our	Company	and	encourages	reporting	of	wrongdoing	by	offering	anonymous	reporting	options	and	a	non-retaliation	policy.	We	will	disclose	 in	 the	Corporate Governance	section	of	our	Web	site	(described	below)	any	amendments	to	our	Directors	Ethics	Code	or	Code	of	Conduct	and	any	waiver	granted	to	an	executive	officer or	director	under	these	codes.

# Corporate	Governance	Materials	Available	on	Our	Web	Site

Our	 Web	 site	 contains	 the	 Guidelines,	 our	 Board	 committee	 charters,	 the	 Code	 of	 Conduct,	 and	 the	 Directors	 Ethics	 Code.	 To	 view	 these	 documents,	 go	 to http://ir.kraftheinzcompany.com	and	click	on	"Corporate	Governance."	We	will	promptly	deliver	free	of	charge,	upon	request,	a	copy	of	the	Guidelines,	the	Board committee	charters,	the	Code	of	Conduct,	or	the	Directors	Ethics	Code	to	any	stockholder	requesting	a	copy.	Requests	should	be	directed	to	our	Corporate	Secretary	at The	Kraft	Heinz	Company,	200	East	Randolph	Street,	Suite	7600,	Chicago,	IL	60601.

The	information	on	our	Web	site	is	not,	and	will	not	be	deemed	to	be,	a	part	of	this	Annual	Report	on	Form	10-K	or	incorporated	by	reference	into	any	of	our	other filings	with	the	SEC.

# Delinquent	Section	16(a)	Reports

Section	16(a)	of	the	Exchange	Act	requires	our	executive	officers	and	directors,	and	persons	who	own	more	than	10%	of	our	common	stock	(collectively,	the	"Reporting Persons"),	to	file	reports	of	ownership	and	changes	in	ownership	with	the	SEC.	Based	solely	upon	a	review	of	Forms	3,	4	and	5	and	amendments	thereto	filed electronically	with	the	SEC	by	the	Reporting	Persons	with	respect	to	the	fiscal	year	ended	December	29,	2018,	we	believe	that	all	filing	requirements	were	complied	with in	a	timely	manner,	except	in	two	instances	where	Form	4s	were	inadvertently	filed	late	on	behalf	of	two	directors	to	report	certain	transactions	as	follows:	(i)	in	April 2018,	to	report	three	purchases	of	shares	that	were	executed	by	the	broker	of	one	of	our	former	directors,	Mackey	McDonald,	on	Mr.	McDonald's	behalf	without	his knowledge	or	direction;	and	(ii)	in	June	2019,	to	report	one	transaction	relating	to	the	transfer	of	certain	shares	held	in	a	trust	for	the	benefit	of	Mr.	Pope's	three	adult children	as	a	result	of	their	election	to	exercise	control	over	such	shares	in	accordance	with	the	terms	of	the	trust	that	held	these	shares.

# BOARD	COMMITTEES	AND	MEMBERSHIP—AUDIT	COMMITTEE

The	Board	established	the	Audit	Committee	in	accordance	with	Section	3(a)(58)(A)	and	Rule	10A-3	under	the	Exchange	Act.	The	Audit	Committee	consists	entirely	of independent	directors,	and	each	director	meets	the	independence	requirements	set	forth	in	the	listing	standards	of	Nasdaq,	Rule	10A-3	under	the	Exchange	Act	and	the Audit	Committee	charter.	The	Board	has	determined	that	each	Audit	Committee	member	is	able	to	read	and	understand	fundamental	financial	statements.	In	addition,	the Board	has	determined	that	Ms.	Jackson	and	Mr.	Pope	are	"audit	committee	financial	experts"	within	the	meaning	of	SEC	regulations.	No	Audit	Committee	member received	any	payments	in	2018	from	us	other	than	compensation	for	service	as	a	director.

# BOARD	COMMITTEES	AND	MEMBERSHIP—OPERATIONS	AND	STRATEGY	COMMITTEE

Effective	June	5,	2019,	the	Board	established	the	Operations	and	Strategy	Committee	to	assist	it	in	overseeing	and	facilitating	the	development	and	implementation	of our	ongoing	operations	and	corporate	strategy.	The	Operations	and	Strategy	Committee	is	led	by	John	Cahill,	Vice	Chairman	of	the	Board,	and	meets	with	management regularly	 to	discuss,	review	and	evaluate	 the	development	and	 implementation	of	our	operational	objectives	and	corporate	strategy.	The	Operations	and	Strategy Committee	is	comprised	of	five	directors	appointed	by	the	Board,	based	on	nominations	recommended	to	the	Board	by	our	Nominating	and	Corporate	Governance Committee.	Based	on	its	review,	the	committee	shares	with	management	the	Board's	expectations	for	the	operations	of	the	company	and	strategic	planning	process, makes	recommendations	to	management	on	areas	of	improvement,	and	provides	other	feedback	and	guidance	to	management	on	behalf	of	the	Board.	The	Operations	and Strategy	Committee's	responsibilities	also	include,	among	others,	reviewing	and	making	recommendations	to	the	Board	regarding:

•our	 corporate strategy,	 performance,	 and	 annual	 capital	 plan,	 as	 well	 as	 certain individual	 capital projects;

•the	impact	of	external	developments	and	factors,	such	as	any	changes	in	economic	and	market	conditions,	competition	in	the	industry,	environmental	and	safety regulations,	federal,	state	and	local	regulations	and	technology,	on	our	corporate	strategy	and	its	execution;

•identification	of	prospects	and	opportunities	for	corporate	developments	and	growth	initiatives,	including	acquisitions,	divestitures,	joint	ventures	and	strategic alliances;	and

•implementation	of	our	corporate	strategy	through	corporate	developments	and	growth	initiatives,	including	acquisitions,	divestitures,	joint	ventures	and	strategic alliances.

# Item	11.	Executive	Compensation.

# BOARD	COMMITTEES	AND	MEMBERSHIP—COMPENSATION	COMMITTEE

# Compensation	Committee	Interlocks	and	Insider	Participation

The	Board	has	determined	that	all	of	the	directors	who	served	on	the	Compensation	Committee	during	fiscal	year	2018	are	independent	within	the	meaning	of	the	Nasdaq listing	standards.	No	member	of	the	Compensation	Committee	is	a	current,	or	during	fiscal	year	2018	was,	a	former,	officer,	or	employee	of	Heinz,	Kraft,	Kraft	Heinz,	or any	of	their	subsidiaries.	During	fiscal	year	2018,	no	member	of	the	Compensation	Committee	had	a	relationship	that	must	be	described	under	the	SEC	rules	relating	to disclosure	of	"related	person	transactions"	(for	a	description	of	our	policy	on	"related	person	transactions,"	see	"Independence	and	Related	Person	Transactions"	in	Item 13,	Certain	Relationships	and	Related	Transactions,	and	Director	Independence).	During	fiscal	year	2018,	none	of	our	executive	officers	served	on	the	board	of directors	or	compensation	committee	of	any	entity	that	had	one	or	more	of	its	executive	officers	serving	on	the	Board	or	the	Compensation	Committee.

# Analysis	of	Risk	in	the	Compensation	Architecture

Annually,	the	Compensation	Committee	evaluates	the	risk	profile	of	our	executive	and	broad-based	employee	compensation	programs.	In	its	evaluation	for	fiscal	year 2018,	 the	 Compensation	 Committee	 reviewed	 our	 executive	 compensation	 structure	 as	 well	 as	 our	 overarching	 compensation	 systems	 to	 determine	 whether	 our compensation	policies	and	practices	encourage	our	executive	officers	or	other	employees	to	take	unnecessary	or	excessive	risks	and	whether	these	policies	and	practices properly	mitigate	risk.	In	addition,	Willis	Towers	Watson	advised	management	with	respect	to	the	risk	assessment	of	our	Performance	Bonus	Plan.

As	described	under	"Compensation	Discussion	and	Analysis,"	our	compensation	structure	is	designed	to	incentivize	executives	and	employees	to	achieve	Kraft	Heinz financial	and	strategic	goals	as	well	as	individual	performance	goals	that	promote	long-term	stockholder	returns.	However,	certain	employees	within	our	procurement organization	engaged	in	misconduct	and	circumvented	controls	that	included	withholding	information	or	directing	others	to	withhold	information	related	to	supplier contracts	that	affected	the	accounting	for	certain	supplier	rebates,	incentives,	and	pricing	arrangements,	in	an	attempt	to	influence	the	achievement	of	internal	financial targets	that	became	or	were	perceived	to	have	become	increasingly	difficult	to	attain	due	to	changes	in	our	business	environment.	We	are	undertaking	various	remedial efforts	outlined	in	Item	9A,	Controls	and	Procedures,	and	expect	to	revise	the	Performance	Bonus	Plan	for	2019	to	explicitly	state	applicable	penalties	such	as	score and/or	percentage	reductions	and	losses,	up	to	and	including	ineligibility	for	and	forfeiture	of	payments	under	the	Performance	Bonus	Plan	for	misconduct.	We	also expect	to	revise	the	Performance	Bonus	Plan	for	2019	to	require	that	if	the	aforementioned	misconduct	is	discovered	after	the	payout	under	the	Performance	Bonus	Plan, we	would	be	entitled	to	seek	equitable	relief	to	recoup	the	amounts	paid,	including	without	limitation	disgorgement,	in	addition	to	any	other	remedies	under	the	law.

# Compensation	Committee	Report

The	Compensation	Committee	oversees	our	compensation	programs	on	behalf	of	the	Board.	In	fulfilling	its	oversight	responsibilities,	the	Compensation	Committee reviewed	and	discussed	with	management	the	Compensation	Discussion	and	Analysis	included	in	this	Annual	Report	on	Form	10-K.	In	reliance	on	that	review	and discussion,	the	Compensation	Committee	recommended	to	the	Board	that	the	Compensation	Discussion	and	Analysis	be	included	in	this	Annual	Report	on	Form	10-K.

Compensation	Committee: Alexandre	Behring,	Chair Jorge	Paulo	Lemann Marcel	Herrmann	Telles

# COMPENSATION	OF	NON-EMPLOYEE	DIRECTORS

Following	the	2015	Merger,	the	Board	approved	our	non-employee	director	compensation	program,	which	was	designed	to	be	similar	to	the	program	in	place	at	Kraft prior	to	the	2015	Merger.	The	table	below	summarizes	the	annual	cash	and	equity	compensation	elements	in	place	for	our	non-employee	directors.

| Compensation	Element(1) | ($) |
| :--- | :--- |
| Board\tRetainer | 110,000 |
| Chairman\tRetainer | 250,000 |
| Audit\tCommittee\tChair\tRetainer | 20,000 |
| Compensation\tCommittee\tChair\tRetainer | 20,000 |
| Governance\tCommittee\tChair\tRetainer | 10,000 |
| Operations\tand\tStrategy\tCommittee\tChair\tRetainer(2) | 20,000 |
| Stock\tGrant\tValue(3) | 125,000 |

(1) If	a	director	serves	as	Chair	of	multiple	committees,	he	or	she	receives	fees	for	only	one	committee.	Therefore,	Mr.	Behring	does	not	receive	a	retainer	for	service	as	Chair	of	the	Governance Committee.

(2) Effective	June	5,	2019,	the	Board	established	the	Operations	and	Strategy	Committee	to	assist	it	in	overseeing	and	facilitating	the	development	and	implementation	of	our	ongoing	operations	and corporate	strategy.	The	Operations	and	Strategy	Committee	is	led	by	John	Cahill,	Vice	Chairman	of	the	Board.

(3) Non-employee	directors	are	awarded	Kraft	Heinz	deferred	shares.	Although	the	deferred	shares	are	vested	as	of	the	award	date,	the	shares	are	not	distributed	until	six	months	following	the	date	the non-employee	director	ceases	to	serve	on	our	Board.	When	dividends	are	paid	on	our	common	stock,	we	accrue	the	value	of	the	dividend	paid	and	issue	shares	equal	to	the	accrued	value	six months	after	the	director's	departure.

Non-employee	directors	receive	an	annual	stock	award	that	is	granted	effective	immediately	following	our	annual	meeting	of	stockholders.	We	also	pay	the	non- employee	directors	cash	retainers	on	a	quarterly	basis.	Non-employee	directors	also	have	the	option	to	(i)	defer	up	to	100%	of	their	cash	retainers	in	25%	increments	into accounts	that	mirror	certain	funds	in	the	Kraft	Heinz	401(k)	Plan	pursuant	to	the	Deferred	Compensation	Plan	for	Non-Management	Directors	or	(ii)	receive	deferred shares	annually	in	lieu	of	their	cash	retainer	payable	in	arrears.

Our	stock	ownership	guidelines	require	non-employee	directors	who	elect	to	receive	compensation	for	service	as	directors	to	hold	shares	of	our	common	stock	in	an amount	equal	to	five	times	the	annual	Board	retainer	(equivalent	to	$550,000)	within	five	years.	As	all	of	our	current	directors	have	served	following	the	2015	Merger	for less	than	five	years,	they	are	not	yet	required	to	meet	the	stock	ownership	requirement.	We	feel	strongly	that	our	director	compensation	program	significantly	aligns	our non-employee	directors'	and	stockholders'	interests.

For	as	long	as	Mr.	Zoghbi	continues	to	serve	as	a	Special	Advisor	at	Kraft	Heinz,	it	is	anticipated	that	he	will	not	receive	compensation	for	his	services	as	a	director.	For a	discussion	of	Mr.	Zoghbi's	compensation	arrangement,	please	see	"Compensation	Arrangement"	in	Item	13,	Certain	Relationships	and	Related	Transactions,	and Director	Independence.

The	table	below	presents	information	regarding	the	compensation	and	stock	awards	that	we	have	paid	or	granted	to	our	non-employee	directors.

# 2018	Non-Employee	Director	Compensation	Table

|  | Fees	Earned	or |  | All	Other |  |
| :--- | :--- | :--- | :--- | :--- |
|  | Paid\tin\tCash(2) | Stock\tAwards(3) | Compensation | Total |
| Name(1) | ($) | ($) | ($) | ($) |
| Gregory\tE.\tAbel | 110,054 | 125,050 | — | 235,104 |
| Alexandre\tBehring | 270,000 | 125,050 | — | 395,050 |
| John\tT.\tCahill(4) | 110,000 | 125,050 | 500,000 | 735,050 |
| Tracy\tBritt\tCool | 110,054 | 125,050 | — | 235,104 |
| Feroz\tDewan | 110,054 | 125,050 | — | 235,104 |
| Jeanne\tP.\tJackson | 110,000 | 125,050 | — | 235,050 |
| Jorge\tPaulo\tLemann | 110,054 | 125,050 | — | 235,104 |
| Mackey\tJ.\tMcDonald | 34,451 | — | — | 34,451 |
| John\tC.\tPope | 130,000 | 125,050 | — | 255,050 |
| Marcel\tHerrmann\tTelles | 110,000 | 125,050 | — | 235,050 |
| Alexandre\tVan\tDamme | 82,500 | 125,050 | — | 207,550 |

(1) As	noted	above,	Mr.	Zoghbi	is	an	employee	of	Kraft	Heinz.	For	as	long	as	Mr.	Zoghbi	continues	to	serve	as	a	Special	Advisor	at	Kraft	Heinz,	it	is	anticipated	that	he	will	not	receive	compensation for	his	services	as	a	director.	For	a	discussion	of	Mr.	Zoghbi's	compensation	arrangement,	please	see	"Compensation	Arrangement"	in	Item	13,	Certain	Relationships	and	Related	Transactions, and	Director	Independence.

(2) Includes	all	retainer	fees	paid	or	deferred	in	exchange	for	shares	pursuant	to	the	Kraft	Heinz	Deferred	Compensation	Plan	for	Non-Management	Directors.	Non-employee	directors	do	not	receive meeting	fees.	In	addition,	Mr.	Buffett	elected	to	receive	no	compensation	for	his	service	as	a	director	through	the	end	of	his	term	at	the	2018	Annual	Meeting.

(3) The	amounts	shown	in	this	column	represent	the	full	grant	date	fair	value	of	the	deferred	stock	awards	granted	in	2018,	excluding	any	retainer	fees	deferred	in	exchange	for	shares,	as	computed	in accordance	with	Financial	Accounting	Standards	Board	("FASB")	Accounting	Standards	Codification	("ASC")	Topic	718	based	on	the	closing	price	of	Kraft	Heinz	shares	on	the	grant	date	($57.68 on	April	23,	2018).	The	following	table	shows	the	aggregate	number	of	stock	options	held	by	non-employee	directors	as	of	December	29,	2018:

(4) Mr.	Cahill	provides	advisory	and	consulting	services	to	Kraft	Heinz	related	to	current	and	historical	finances,	relationships	with	licensors,	customers,	and	vendors,	employee	matters,	product development,	marketing	and	distribution,	government	affairs,	and	strategic	opportunities.	These	services	are	provided	pursuant	to	a	consulting	agreement	entered	into	between	Mr.	Cahill	and	the Company	in	November	2017.	Previously,	these	services	were	provided	pursuant	to	an	arrangement	entered	into	following	the	2015	Merger.	Mr.	Cahill's	services	under	the	consulting	agreement are	distinct	and	separate	from	his	duties	as	a	director.	Payments	to	Mr.	Cahill	under	the	consulting	agreement	are	disclosed	in	the	"All	Other	Compensation"	column.	For	a	discussion	of	the advisory	 and	 consulting	 services	 provided	 by	 Mr.	 Cahill	 to	 Kraft	 Heinz,	 please	 see	 "Consulting	Agreement"	 in Item	 13,	Certain	 Relationships	 and	 Related	 Transactions,	 and	 Director Independence.

# COMPENSATION	DISCUSSION	AND	ANALYSIS

This	Compensation	Discussion	and	Analysis,	which	we	refer	to	as	the	"CD&A",	outlines	the	compensation	philosophy	and	objectives	of	Kraft	Heinz	and	describes	our executive	pay	programs	for	fiscal	year	2018	and,	specifically,	for	the	following	Named	Executive	Officers	(also	referred	to	as	"NEOs"):

# Executive	Summary

The	Compensation	Committee	(the	"Committee")	oversees	our	executive	compensation	plans	and	programs.	Our	programs	are	designed	to	complement	each	other	to provide	a	clear	link	between	what	we	pay	our	NEOs	and	Kraft	Heinz's	performance	over	both	short-	and	long-term	periods.	The	overall	program	has	been	designed	to accomplish	each	of	the	following	goals:

•Rewarding superior financial and operational performance;

•Placing	 a significant portion of compensation at risk if performance goals are not achieved;

•Aligning	the	interests	of	the	NEOs	with	those	of	our	stockholders; and

•Enabling us to attract, retain, and	 motivate top talent.

Consistent	with	these	goals	and	as	described	in	further	detail	below,	our	compensation	program	has	been	designed	with	a	view	toward	linking	a	significant	portion	of each	NEO's	compensation	to	Company	and	individual	performance	and	the	growth	in	the	value	of	Kraft	Heinz.

# Elements	of	Compensation	Program

As	noted	above,	our	compensation	program	is	based	on	a	pay-for-performance	philosophy.	This	section	of	the	CD&A	provides	an	overview	of	each	element	of	our compensation	program	and	describes	both	the	process	for	determining	such	compensation	and	how	such	compensation	relates	to	Kraft	Heinz's	pay-for-performance philosophy	and	meritocratic	principles.	The	following	table	summarizes	the	primary	elements	and	objectives	of	our	2018	compensation	program	for	executive	officers, including	our	NEOs.

# Base	Salary

Base	salary	is	the	principal	"fixed"	element	of	executive	compensation	at	Kraft	Heinz	and	for	our	NEOs.	The	Committee	believes	that	it	is	important	that	each	NEO receive	a	competitive	marketplace	base	salary	to	provide	an	appropriate	balance	between	fixed	and	variable	compensation.	The	initial	base	salary	of	each	NEO	is established	in	connection	with	the	hiring	of	such	NEO.	In	establishing	base	salaries,	Kraft	Heinz	reviews	market-based	survey	data	published	by	the	Hay	Group	and select	country-specific	surveys,	in	each	case,	for	informational	purposes	only.	We	do	not	formally	benchmark	compensation	or	target	compensation	levels	at	any particular	percentile	of	the	survey	data.	The	Committee	reviews	salaries	on	an	annual	basis	and	generally	makes	any	annual	changes	effective	January	1st.	On	occasion, Kraft	Heinz	may	review	and	adjust	an	executive's	base	salary	during	the	course	of	the	year	to	account	for	increased	responsibilities,	roles,	and	other	factors.	The Committee	has	sole	responsibility	for	the	review	of	Mr.	Hees's	compensation.	Mr.	Hees	has	primary	responsibility	for	the	review	of	the	compensation	of	his	direct reports,	including	the	other	NEOs,	and	provides	salary	recommendations	to	the	Committee.

The	table	below	shows	the	annualized	2018	base	salary	for	each	NEO.

|  | Base	Salary |
| :--- | :--- |
| Name | ($) |
| Mr.\tHees | 1,000,000 |
| Mr.\tKnopf | 500,000 |
| Mr.\tBasilio | 750,000 |
| Mr.\tOliveira(1) | 560,101 |
| Ms.\tLa\tLande(2) | 650,000 |

(1) Mr.	Oliveira's	base	salary	is	paid	in	British	pounds.	The	amount	shown	in	the	table	above	is	based	on	the	following	12-month	average	exchange	rate	of	0.7499	USD/GBP.	Mr.	Oliveira's	base salary	was	increased	effective	January	1,	2018	in	connection	with	the	Committee's	annual	base	salary	review	process.

We	believe	that	the	base	salary	review	process	serves	our	pay-for-performance	philosophy,	because	base	pay	increases	are	generally	merit-based	and	dependent	on	the NEO's	success	and	achievement	in	his	or	her	role.	In	addition,	each	NEO's	target	annual	incentive	award	opportunity,	as	described	below,	is	based	on	a	percentage	of	his or	her	base	salary.	Therefore,	as	NEOs	earn	merit-based	salary	increases,	their	annual	incentive	award	opportunities	also	increase	proportionately.

# Annual	Cash	Performance	Bonus	Plan

The	Performance	Bonus	Plan	(the	"PBP")	is	designed	to	motivate	and	reward	employees	who	contribute	positively	toward	our	business	strategy	and	achieve	their individual	performance	objectives.	For	2018,	the	formula	for	determining	a	PBP	participant's	annual	bonus	payout	was	as	follows	(each	item	being	described	in	more detail	below):

Base	Salary	x	Target	Award	x	Financial	Multiplier	x	Individual	Rating	=	PBP	Payout

Due	to	the	difficult	operating	environment	in	2018	and	the	Company's	financial	performance,	Messrs.	Hees,	Knopf,	and	Basilio	asked	to	forfeit	their	rights	to	the amounts	payable	pursuant	to	the	PBP	with	respect	to	fiscal	year	2018,	and	the	Committee	approved	their	forfeitures.

For	a	description	of	our	NEOs'	base	salaries,	please	see	"Base	Salary"	above.	Because	Ms.	La	Lande	was	hired	on	January	22,	2018,	the	base	salary	used	for	her	PBP calculation	was	prorated	to	reflect	her	service	for	11	months.

# Target	Award

Each	NEO	is	granted	a	target	award	opportunity	prior	to	the	beginning	of	each	year,	which	is	set	as	a	percentage	of	the	NEO's	annual	base	salary:	300%	for	Mr.	Hees, 175%	for	Mr.	Knopf,	250%	for	Mr.	Basilio,	175%	for	Mr.	Oliveira,	and	150%	for	Ms.	La	Lande.	Due	to	the	nature	of	Mr.	Hees's	role	and	responsibilities	and	the significant	nature	of	Mr.	Basilio's	role	as	President	of	our	largest	business,	their	respective	Target	Award	Opportunities	were	greater	than	the	other	NEOs,	although,	as noted	above,	due	to	the	difficult	operating	environment	in	2018	and	the	Company's	financial	performance,	Messrs.	Hees,	Knopf,	and	Basilio	asked	to	forfeit	their	rights to	the	amounts	payable	pursuant	to	the	PBP	with	respect	to	fiscal	year	2018,	and	the	Committee	approved	their	forfeitures.

# Financial	Multiplier

Another	component	of	a	participant's	PBP	calculation	is	the	Company's	(or	the	relevant	Zone's	or	business	unit's)	financial	performance	("Financial	Multiplier").	For 2018,	the	Financial	Multiplier	was	initially	designed	to	be	based	on	Adjusted	EBITDA	performance	and	could	have	ranged	from	0%	to	150%,	with	performance	between threshold	 and	 maximum	 levels	 resulting	 in	 a	 payout	 between	 50%	 and	 150%,	 and	 with	 performance	 below	 threshold	 resulting	 in	 no	 payout.	 In	 June	 2018,	 our management	team	established	a	revised	business	plan	for	the	second	half	of	the	2018	fiscal	year	(the	"2H	Plan").	The	2H	Plan	was	intended	to	drive	net	sales	("NSV") growth	by	regaining	distribution	and	building	velocity	to	position	the	Company	for	long-term	financial	health	and	success.	In	June	2018,	in	order	to	(i)	capture	overall commercial,	operational,	and	financial	performance	of	the	Company	and	(ii)	incentivize	management	to	deliver	the	2H	Plan	to	position	the	Company	for	long-term financial	health	and	success,	the	Committee	exercised	its	discretion	under	the	PBP	to	include	NSV	and	Adjusted	Net	Income	as	elements	of	the	Financial	Multiplier	as described	below.	A	participant's	final	Financial	Multiplier	was	calculated	based	on	the	metrics	aligned	to	the	2H	Plan.	As	described	above,	Messrs.	Hees,	Knopf,	and Basilio	forfeited	their	respective	rights	to	the	amounts	payable	pursuant	to	the	PBP	for	2018.	For	Mr.	Oliveira	and	Ms.	La	Lande,	the	amounts	payable	calculated pursuant	to	the	metrics	aligned	to	the	2H	Plan	were	greater	than	if	they	had	been	calculated	using	the	metrics	as	initially	designed.

For	2018,	for	participants	evaluated	based	on	global	performance,	including	Messrs.	Hees	and	Knopf	and	Ms.	La	Lande,	the	Financial	Multiplier	was	calculated	based	on global	change	in	Adjusted	Net	Income.	If	performance	resulted	between	the	threshold	and	maximum	levels	for	Adjusted	Net	Income,	the	component	multiplier	would have	ranged	from	60%	to	100%.	If	the	threshold	had	not	been	met,	the	component	multiplier	would	be	0%.

For	participants	evaluated	based	on	Zone	(operating	segment)	or	business	unit	performance,	including	Messrs.	Basilio	and	Oliveira,	who	were	evaluated	based	on	U.S. and	EMEA	Zone	performance,	respectively,	the	Financial	Multiplier	was	calculated	based	30%	on	global	change	in	Adjusted	Net	Income	and	70%	based	on	their respective	Zone	or	business	unit	financial	performances.	Zone	and	business	unit	financial	performance	was	based	75%	on	change	in	NSV	and	25%	on	change	in	Segment Adjusted	 EBITDA.	 If	 performance	 resulted	 between	 the	 threshold	 and	 target	 levels	 for	 NSV,	 the	 component	 multiplier	 would	 have	 ranged	 from	 60%	 to	 100%, depending	on	the	Zone.	If	performance	resulted	between	the	threshold	and	maximum	levels	for	Segment	Adjusted	EBITDA,	the	component	multiplier	would	have ranged	from	60%	to	130%.	For	all	cases,	if	the	threshold	had	not	been	met,	the	relevant	component	multiplier	would	be	0%.

| Performance	Metric* | Threshold | Target | Maximum | Actual | %	of	Target |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Global\tAdjusted\tNet\tIncome\tPerformance(1) | (3.5)% | 3.4\t% | 10.2% | (3.0)% | 62% |
| U.S.\tSegment\tAdjusted\tEBITDA\tPerformance | (6.4)% | (3.0)% | 0.4% | (11.5)% | —% |
| U.S.\tNSV\tPerformance | (0.9)% | 0.2\t% | N/A | (0.6)% | 75% |
| EMEA\tSegment\tAdjusted\tEBITDA\tPerformance(2) | 8.1\t% | 12.3\t% | 16.4% | 2.2\t% | 60% |
| EMEA\tNSV\tPerformance | 1.1\t% | 3.3\t% | N/A | 2.6\t% | 90% |

*Growth	rates	reflect	budget	foreign	exchange	rates	and	exclude	the	impacts	of	(i)	our	Venezuelan	subsidiary,	due	to	the	highly	inflationary	environment,	(ii)	our	50.1%	interest	in	our	South	African subsidiary,	which	was	sold	in	May	2018,	and	(iii)	with	respect	to	NSV,	fluctuations	for	dairy	commodities	that	impact	pricing	terms	under	related	contracts.	Adjusted	Net	Income	is	defined	as	net income/(loss)	excluding,	when	they	occur,	the	impacts	of	integration	and	restructuring	expenses,	deal	costs,	unrealized	losses/(gains)	on	commodity	hedges,	impairment	losses,	losses/(gains)	on	the sale	of	a	business,	other	losses/(gains)	related	to	acquisitions	and	divestitures	(e.g.,	tax	and	hedging	impacts),	nonmonetary	currency	devaluation	(e.g.,	remeasurement	gains	and	losses),	and	U.S.	Tax Reform	discrete	income	tax	expense/(benefit),	and	including,	when	they	occur,	adjustments	to	reflect	preferred	stock	dividend	payments	on	an	accrual	basis.	Segment	Adjusted	EBITDA	is	defined	as net	income/(loss)	from	continuing	operations	before	interest	expense,	other	expense/(income),	net,	provision	for/(benefit	from)	income	taxes,	and	depreciation	and	amortization	(excluding	integration and	restructuring	expenses);	in	addition	to	these	adjustments,	we	exclude,	when	they	occur,	the	impacts	of	integration	and	restructuring	expenses,	deal	costs,	unrealized	gains/(losses)	on	commodity hedges	(the	unrealized	gains	and	losses	are	recorded	in	general	corporate	expenses	until	realized;	once	realized,	the	gains	and	losses	are	recorded	in	the	applicable	segment's	operating	results), impairment	losses,	gains/(losses)	on	the	sale	of	a	business,	other	gains/(losses)	related	to	acquisitions	and	divestitures	(e.g.,	tax	and	hedging	impacts),	nonmonetary	currency	devaluation	(e.g., remeasurement	gains	and	losses),	and	equity	award	compensation	expense	(excluding	integration	and	restructuring	expenses).

(1) When	the	Committee	certified	the	achievement	of	performance	with	respect	to	Adjusted	Net	Income	performance,	fiscal	year	2018	consolidated	financial	statements	were	still	being	prepared. Given	the	immateriality	of	any	anticipated	adjustments,	the	Committee	certified	and	approved	performance	at	a	maximum	level	of	64%,	subject	to	downward	adjustment	in	management's discretion	based	on	the	preparation	of	the	2018	consolidated	financial	statements.

(2) When	the	Committee	certified	performance	with	respect	to	EMEA	Segment	Adjusted	EBITDA	performance,	the	Committee	certified	and	approved	performance	at	an	amount	excluding	the	impact of	the	Middle	East	and	Africa	("MEA")	due	to	one-off	inventory	amounts	related	to	previous	years	when	MEA	was	a	part	of	a	different	operating	segment	than	EMEA.

In	2018,	all	NEOs	exceeded	threshold	on	their	Individual	Rating	and	Financial	Multiplier	components	of	the	PBP	calculation.	The	Committee	granted	certain	members of	management	discretion	to	increase	or	decrease	the	final	PBP	payouts	of	the	other	NEOs	with	up	to	a	20%	variance	compared	to	the	amounts	as	calculated	based	on	the Base	Salaries,	Target	Awards,	Individual	Ratings,	and	Financial	Multipliers	described	above.	Had	they	not	forfeited	their	rights	to	the	payment,	Mr.	Hees	would	have earned	a	PBP	payout	of	$1,060,000,	Mr.	Knopf	would	have	earned	a	PBP	payout	of	$500,000,	and	Mr.	Basilio	would	have	earned	a	PBP	payout	of	$1,023,000.	Mr. Oliveira	received	a	PBP	payout	of	$733,854,	and	Ms.	La	Lande	received	a	PBP	payout	of	$543,000.	Mr.	Hees	would	have	received	a	decreased	discretionary	payout related	to	the	longer-term	business	initiatives	reflected	in	his	MBOs.	Messrs.	Knopf	and	Basilio	would	have	received,	and	Mr.	Oliveira	and	Ms.	La	Lande	did	receive,	an increased	discretionary	payout	related	to	top	line	growth	results	and/or	strong	leadership	of	important	initiatives	in	his	or	her	respective	area.

# Individual	Rating

The	foundation	of	each	participant's	Individual	Rating	is	our	MBO	process.	At	the	beginning	of	each	year,	the	Committee	establishes	a	series	of	performance	goals,	or MBOs,	that	are	established	based	on	the	Company's	corporate	strategy,	and	performance	goals	are	then	"cascaded"	throughout	the	organization.	First,	the	Committee establishes	MBOs	for	Mr.	Hees.	Then,	in	consultation	with	the	Committee,	Mr.	Hees	establishes	corresponding	MBOs	for	each	of	his	direct	reports,	including	the	other NEOs.	His	direct	reports,	in	turn,	establish	MBOs	for	their	direct	reports.	This	cascading	process	allows	the	Company	to	drive	initiatives	that	are	aligned	throughout	the organization.

Each	NEO	has	an	MBO	comprised	of	multiple	goals	or	objectives.	For	each	goal,	there	are	one	or	more	"Key	Performance	Indicators,"	or	KPIs.	KPIs	are	the	quantitative or	qualitative	metrics	used	to	track	achievement	of	the	goals.	We	have	set	forth	below	a	summary	of	the	2018	MBO	goals	for	each	of	the	NEOs	and	the	overall performance	ascribed	by	the	Committee	for	each	NEO	based	on	his	or	her	performance.	None	of	the	individual	KPIs	are	material	to	understanding	how	the	PBP	operated in	2018.

Bernardo	Hees:	Mr.	Hees	had	three	MBO	goals.	These	were:	(i)	"Deliver	Kraft	Heinz	Financial	Results",	which	was	evaluated	based	on	Kraft	Heinz's	financial performance	in	NSV	and	Adjusted	Net	Income,	(ii)	"Strengthen	Innovation	and	Develop	Digital	Strategy/Go-to-Market",	which	was	evaluated	based	on	the	innovation pipeline	for	2019	and	2020	and	E-commerce	and	digital	innovation,	and	(iii)	"Deliver	New	Projects	to	Sustain	the	Business",	which	was	evaluated	based	on	the	supply chain	planning	system	and	business	expansion.	Based	on	Mr.	Hees's	performance,	he	was	given	an	overall	performance	score	of	66%.

David	Knopf:	Mr.	Knopf	had	 three	MBO	goals.	These	were	(i)	"Deliver	Kraft	Heinz	Financial	Results",	which	was	evaluated	based	on	Kraft	Heinz's	financial performance	in	Adjusted	Net	Income	and	operating	free	cash	flow,	(ii)	"Increase	KHC	Financial	Efficiency",	which	was	evaluated	based	on	tax	performance	compared	to budget	and	project-specific	goals,	and	(iii)	"Deliver	New	Projects	to	Sustain	the	Business",	which	was	evaluated	based	on	business	expansion	and	project-specific	goals. Based	on	Mr.	Knopf's	performance,	he	was	given	an	overall	performance	score	of	82%.

Paulo	Basilio:	Mr.	Basilio	had	 three	MBO	goals.	These	were	(i)	"Deliver	Kraft	Heinz	Results",	which	was	evaluated	based	on	case	fill	rates	and	U.S.	financial performance	in	contribution	margin	and	NSV,	(ii)	"Ensure	Successful	Marketing	and	Robust	R&D	Pipeline,"	which	was	evaluated	based	on	market	share	and	the innovation	pipeline	for	2019	in	the	U.S.	Zone,	and	(iii)	"Deliver	New	Projects	to	Foster	the	Business",	which	was	evaluated	based	on	initiatives	relating	to	Kraft	Heinz's Springboard	platform.	Based	on	Mr.	Basilio's	performance,	he	was	given	an	overall	performance	score	of	84%.

Rafael	Oliveira:	Mr.	Oliveira	had	three	MBO	goals.	These	were	(i)	"Deliver	Kraft	Heinz	EMEA	Financial	Results,"	which	was	evaluated	based	on	EMEA	financial performance	in	contribution	margin	and	NSV,	(ii)	"Ensure	Successful	Marketing	and	Robust	R&D	Pipeline,"	which	was	evaluated	based	on	market	share	and	the innovation	pipeline	for	2019	in	the	EMEA	Zone,	and	(iii)	"Deliver	New	Projects	to	Foster	the	Business,"	which	was	evaluated	based	on	foodservice	growth	in	EMEA and	NSV	growth	in	MEA.	Based	on	Mr.	Oliveira's	performance,	he	was	given	an	overall	performance	score	of	84%.

Rashida	La	Lande:	Ms.	La	Lande	had	three	MBO	goals.	These	were	(i)	"Deliver	Effective	and	Efficient	Legal	Services,"	which	was	evaluated	based	on	project-specific goals	and	legal	victories,	financial	and	EBITDA	partnerships	with	the	business,	and	legal	victories	from	ongoing	litigation,	(ii)	"Protect	and	Promote	our	Innovations	and Brands,"	which	was	evaluated	based	on	Board	projects	and	crisis	management	design	and	preparation	for	the	U.S.	and	Canada,	and	(iii)	"Ethics	and	Compliance"	which was	evaluated	based	on	the	Company's	ethics	and	compliance	initiatives	worldwide.	Based	on	Ms.	La	Lande's	performance,	she	was	given	an	overall	performance	score of	95%.

# Annual	Bonus	Swap	Program	-	Restricted	Stock	Units

As	part	of	its	commitment	to	fostering	an	ownership	mentality,	Kraft	Heinz	permits	certain	employees	to	participate	in	an	annual	bonus	swap	program	(the	"Bonus	Swap Program").	Under	the	Bonus	Swap	Program,	eligible	employees	can	elect	to	invest	a	portion	of	their	annual	PBP	payout	in	our	common	stock	(we	refer	to	these purchased	shares	as	"Investment	Shares")	and	leverage	that	investment	through	the	issuance	of	matching	RSUs	(we	refer	to	these	RSUs	as	"Matching	RSUs").	The Matching	RSUs	cliff	vest	on	the	fifth	anniversary	of	the	date	of	grant	subject	to	continued	employment	and	the	retention	of	the	Investment	Shares	as	described	below.	To participate	in	the	Bonus	Swap	Program,	eligible	employees	can	elect	to	use	0%,	25%	or	50%	of	their	calculated	net	bonus	(after	deducting	an	amount	based	on	a normalized	tax	rate	depending	on	country	of	residence)	to	purchase	Investment	Shares.	The	number	of	Investment	Shares	purchased	is	calculated	as	the	product	of	the calculated	net	bonus	and	the	swap	election	percentage,	divided	by	the	closing	price	reported	on	the	Nasdaq	on	the	date	of	purchase:

Calculated	Net	Bonus x

Nasdaq	Closing	Price

Swap	Election	%

= #	of	Investment	Shares

The	number	of	Matching	RSUs	a	participant	received	in	2018	was	based	on	(1)	the	participant's	gross	bonus	payout	in	2018	relating	to	the	2017	fiscal	year	(before-tax) and	(2)	a	discretionary	multiplier	associated	with	the	participant's	level	in	the	organization	and	his	or	her	investment	election	percentage.

In	2018,	only	Mr.	Oliveira	participated	in	the	Bonus	Swap	Program,	as	he	was	the	only	NEO	to	receive	a	PBP	bonus	payment	related	to	2017.	The	following	table	sets forth,	for	Mr.	Oliveira,	the	portion	of	his	fiscal	2017	bonus	used	to	purchase	Investment	Shares	(the	"Conversion	Amount"),	the	number	of	Investment	Shares	purchased, and	the	number	of	Matching	RSUs	granted	to	him	(which	Matching	RSUs	were	granted	in	2018):

Under	our	Bonus	Swap	Program,	so	long	as	the	Matching	RSUs	remain	unvested,	if	an	employee	transfers	any	of	the	related	Investment	Shares,	he	or	she	immediately forfeits	a	proportional	amount	of	the	corresponding	Matching	RSUs.	The	Committee	believes	that	the	Bonus	Swap	Program	as	a	whole	and	the	forfeitability	of	the Matching	RSUs	in	particular,	strongly	motivates	eligible	employees	to	hold	Kraft	Heinz	common	stock	for	the	long-term,	further	emphasizing	a	long-term	view	in creating	stockholder	value.	Prior	to	2016,	the	Company	issued	matching	stock	options	rather	than	Matching	RSUs	in	the	Bonus	Swap	Program.

# Discretionary	Equity	Awards

From	time	to	time,	we	may	make	discretionary	equity	awards	to	employees.	Historically,	these	discretionary	awards	have	been	made	in	the	form	of	stock	options.	These stock	options	are	granted	with	an	exercise	price	based	on	the	fair	market	value	of	a	Kraft	Heinz	share	on	the	grant	date	and	cliff	vest	after	a	five-year	period.	In	2018,	the Committee	approved	discretionary	option	awards	of	44,850	stock	options	to	Mr.	Knopf	and	52,325	stock	options	to	Ms.	La	Lande	in	order	to	continue	to	align	a	portion of	their	long-term	incentive	compensation	directly	with	stockholders'	interests.	The	options	have	an	exercise	price	of	$66.89	and	will	cliff	vest	on	March	1,	2023,	subject to	continued	employment	through	that	date.

In	March	2018,	the	Company	issued	additional	PSUs	to	a	limited	number	of	employees	deemed	key	to	achievement	of	our	long-term	goals,	including	all	of	our	NEOs,	in order	to	place	a	significant	portion	of	their	compensation	at	risk	if	performance	goals	are	not	achieved.	These	PSUs	could	be	earned	over	a	three-year	performance	period based	on	Kraft	Heinz's	achievement	of	financial	performance	metrics	based	on	Adjusted	EBITDA	for	the	period	beginning	in	January	2018	and	ending	at	the	end	of December	2020.	Once	earned,	to	promote	retention	of	key	talent,	the	PSUs	will	remain	subject	to	a	continued	service	requirement	through	March	1,	2023.	As	of December	29,	2018,	due	to	the	performance	of	our	business,	the	expected	payout	of	the	PSUs	was	determined	to	be	zero.

In	March	2018,	in	order	to	further	retain	and	motivate	top	talent	and	align	the	interests	of	management	with	those	of	the	Company's	stockholders,	the	Company	also issued	RSUs,	separately	from	the	Bonus	Swap	Program,	to	a	limited	number	of	employees	deemed	key	to	achievement	of	our	long-term	goals,	including	all	of	our	NEOs. These	RSUs	will	cliff	vest	on	March	1,	2023,	subject	to	continued	employment.

Additional	information	about	the	stock	option,	PSU,	and	RSU	awards	is	provided	in	the	2018	Grants	of	Plan	Based	Awards	Table	and	the	2018	Outstanding	Equity Awards	at	Fiscal	Year-End	Table	below.

# Benefits	and	Perquisites

In	addition	to	base	salary,	our	PBP,	and	long-term	equity	grants,	we	provided	and	continue	to	provide	certain	executive	benefit	programs	to	our	NEOs.	Kraft	Heinz maintains	defined	contribution	retirement	plans	to	allow	employees	to	save	for	retirement	in	a	tax-efficient	manner.	These	plans	are	broadly	available	to	eligible employees	and	do	not	discriminate	in	favor	of	the	NEOs	or	other	members	of	senior	management.	None	of	the	NEOs	participate	in	any	defined	benefit	pension	plans, non-qualified	deferred	compensation	plans,	or	supplemental	retirement	or	executive	savings	plans.

Kraft	Heinz	also	provides	health	and	welfare	insurance	benefits	to	employees,	including	the	NEOs.	These	benefits	include	life,	disability,	and	health	insurance	benefit plans	that	are	broadly	available	to	eligible	employees	and	do	not	discriminate	in	favor	of	the	NEOs	or	other	members	of	senior	management.

From	time	to	time,	Kraft	Heinz	provides	limited	perquisite	benefits.	For	example,	we	provide	limited	tax	advisory	services,	immigration	benefits,	and	reimbursement	of certain	relocation	expenses	for	business	reasons.	Kraft	Heinz	provides	other	limited	perquisite	benefits,	which	are	detailed	in	the	2018	Summary	Compensation	Table.

# Minimum	Stock	Ownership	Guidelines

Our	compensation	programs	promote	a	strong	alignment	of	the	interests	of	our	executives	with	those	of	our	stockholders.	For	example,	in	order	to	participate	in	our Bonus	Swap	Program,	each	participant	must	use	a	significant	portion	of	his	or	her	bonus	to	purchase	our	common	stock.	In	2016,	we	adopted	minimum	stock	ownership guidelines,	which	require	our	NEOs	to	attain	levels	of	beneficial	stock	ownership	measured	based	on	a	multiple	of	his	or	her	annual	base	salary,	as	set	forth	below:

The	stock	ownership	guidelines	require	NEOs	to	attain	levels	of	beneficial	stock	ownership	within	five	years	from	the	later	of	December	8,	2016	and	the	date	of	the NEO's	appointment	to	a	position	subject	to	the	guidelines.	For	more	details	on	the	stock	ownership	of	our	NEOs,	please	refer	to	"Ownership	of	Equity	Securities."

# Clawback,	Anti-Hedging	and	Anti-Pledging	Policies

Our	stock	option,	PSU,	and	RSU	award	agreements	provide	that,	in	certain	circumstances,	the	award	and	any	proceeds	or	other	benefits	a	participant	may	receive	may	be subject	to	forfeiture	and/or	repayment	to	Kraft	Heinz	to	the	extent	required	to	comply	with	any	requirements	imposed	under	applicable	laws	and/or	the	rules.	Further,	if	a participant	receives	any	amount	in	excess	of	what	he	or	she	should	have	received	under	the	terms	of	the	award	for	any	reason	(including	without	limitation	by	reason	of	a financial	restatement,	mistake	in	calculations,	or	administrative	error),	all	as	determined	by	the	Committee,	then	he	or	she	will	be	required	to	promptly	repay	any	such excess	amount	to	Kraft	Heinz.	Our	insider	trading	policy	also	limits	the	timing	and	types	of	transactions	in	Kraft	Heinz	securities	by	executive	officers,	including	our NEOs.	Among	other	restrictions,	the	policy	prohibits	holding	Kraft	Heinz	securities	in	a	margin	account	or	pledging	Kraft	Heinz	securities	as	collateral	for	a	loan	without advance	written	notice	to	the	Corporate	Secretary.	In	addition,	the	policy	prohibits	short-selling	Kraft	Heinz	securities,	transacting	in	puts,	calls,	or	other	derivatives	on Kraft	Heinz	securities,	or	hedging	transactions	on	Kraft	Heinz	securities	without	prior	approval	from	the	Corporate	Secretary.

# Impact	of	Tax	and	Accounting	Policies

When	determining	total	direct	compensation	packages,	the	Committee	considers	all	factors	that	may	have	an	impact	on	our	financial	performance,	including	tax	and accounting	rules	and	regulations	under	Section	162(m)	of	the	Code.	Section	162(m)	of	the	Code	generally	limits	our	ability	to	deduct	compensation	paid	to	"covered employees"	(as	defined	in	the	Code)	to	the	extent	such	compensation	exceeds	$1	million	to	such	employee	in	any	fiscal	year.	For	taxable	years	beginning	prior	to	January 1,	2018,	there	was	a	performance-based	exception	to	this	rule	that	permitted	us	to	deduct	compensation	that	met	certain	qualifying	performance-based	criteria.	This performance-based	exception	no	longer	applies	for	taxable	years	beginning	after	December	31,	2017,	such	that	compensation	paid	to	our	"covered	employees"	in	excess of	$1	million	will	not	be	deductible	unless	it	qualifies	for	limited	transition	relief	applicable	to	certain	arrangements	in	place	as	of	November	2,	2017.

Despite	the	Committee's	intentions	to	structure	the	Company's	incentive	programs	for	taxable	years	commencing	prior	to	January	1,	2018	in	a	manner	intended	to	be exempt	from	the	deduction	limitations	of	Section	162(m),	there	can	be	no	assurance	that	we	will	be	able	to	take	advantage	of	the	limited	transition	relief	and	satisfy	the requirements	for	such	exemption.	Further,	the	Committee	reserves	the	right	to	modify	compensation	that	was	initially	intended	to	be	exempt	from	Section	162(m)	if	it determines	that	such	modifications	are	consistent	with	the	Company's	business	needs.

# EXECUTIVE	COMPENSATION	TABLES

# Summary	Compensation	Table

|  |  |  |  |  |  |  | Change	in |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  |  |  |  |  | Pension\tValue |  |  |  |
|  |  |  |  |  |  |  | and\tNon- |  |  |  |
|  |  |  |  |  |  |  | qualified |  |  | Total |
|  |  |  |  |  |  | Non-Equity | Deferred |  |  | Compensation\tas |
| Name\tand |  |  |  | Stock | Option | Incentive\tPlan | Compensation | All\tOther | Total | Adjusted\tfrom |
| Principal |  | Salary | Bonus | Awards(2)(3) | Awards(4) | Compensation(5) | Earnings | Compensation(6) | Compensation | SEC\tRules(7) |
| Position | Year | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) |
| Bernardo\tHees,\nChief\tExecutive\nOfficer(1) | 2018 | 1,000,000 | — | 25,483,713 | — | 1,060,000 | — | 149,136 | 27,692,849 | 1,149,136 |
|  | 2017 | 1,000,000 | — | 2,730,557 | — | — | — | 463,622 | 4,194,179 | 4,194,196 |
|  | 2016 | 1,000,000 | — | 1,449,990 | — | 2,730,574 | — | 92,027 | 5,272,591 | 2,542,027 |
| David\tKnopf,\nEVP\tand\tChief\nFinancial\tOfficer | 2018 | 500,000 | — | 5,946,213 | 497,835 | 500,000 | — | 28,177 | 7,472,225 | 528,176 |
|  | 2017 | 288,461 | — | 2,833,532 | 327,515 | — | — | 27,714 | 3,477,222 | 562,066 |
| Paulo\tBasilio, | 2018 | 750,000 | — | 16,989,123 | — | 1,023,000 | — | 83,699 | 18,845,822 | 833,699 |
| Zone\tPresident |  |  |  |  |  |  |  |  |  |  |
| of\tU.S. |  |  |  |  |  |  |  |  |  |  |
|  | 2017 | 623,077 | — | 1,499,909 | — |  | — | 79,840 | 2,202,826 | 2,202,917 |
|  | 2016 | 600,000 | — | 599,924 | — | 1,500,000 | — | 48,656 | 2,748,580 | 1,248,656 |
| Rafael\tOliveira, | 2018 | 560,101 | — | 8,937,536 |  | 733,854 | — | 101,918 | 10,333,408 | 1,074,047 |
| Zone\tPresident |  |  |  |  |  |  |  |  |  |  |
| of\tEMEA(8) |  |  |  |  |  |  |  |  |  |  |
|  | 2017 | 450,657 | — | 303,273 | 409,397 | 412,029 | — | 166,835 | 1,742,191 | 919,726 |
| Rashida\tLa | 2018 | 612,500 | 1,000,000 | 2,973,163 | 580,808 | 543,000 | — | 86,910 | 5,796,381 | 1,699,410 |

Corporate

Secretary

(1) On	April	22,	2019,	we	announced	that	Mr.	Hees	would	leave	Kraft	Heinz	in	2019.	Mr.	Hees	forfeited	the	PSU	and	RSU	awards	granted	in	2018	(aggregate	grant	date	fair	value	of	$25,483,713) due	to	the	performance	of	the	business	and	his	decision	to	leave	the	company,	respectively.	Therefore,	the	Total	Compensation	as	Adjusted	from	SEC	Rules	paid	to	Mr.	Hees	in	2018	was $1,149,136.

(2) The	amounts	shown	in	this	column	include	the	aggregate	grant	date	fair	value,	computed	in	accordance	with	FASB	ASC	Topic	718,	of	(i)	Matching	RSUs,	(ii)	PSUs,	and	(iii)	RSUs	granted	to	the NEOs.	As	of	December	29,	2018,	due	to	the	performance	of	our	business,	the	expected	payout	of	the	PSUs	was	determined	to	be	zero. 	For	a	discussion	of	the	assumptions	made	in	the	valuation	of the	awards	in	this	column,	see	Note	12,	Employees'	Stock	Incentive	Plans,	in	Item	8,	Financial	Statements	and	Supplementary	Data .	Under	our	Bonus	Swap	Program,	the	Matching	RSUs	for	the NEOs	were	calculated	as	the	product	of	the	calculated	gross	bonus	and	the	swap	election	percentage,	divided	by	the	closing	price	reported	on	the	Nasdaq	on	the	date	of	purchase.	For	a	discussion of	the	terms	applicable	to	the	Matching	RSUs,	PSUs,	and	RSUs	as	well	as	vesting,	forfeiture,	and	other	terms,	see	"Elements	of	Compensation	Program"	in	the	CD&A.

(4) Amounts	shown	in	this	column	represent	the	aggregate	grant	date	fair	value	of	discretionary	option	awards	granted	to	the	NEOs.	The	values	of	the	stock	option	awards	are	equal	to	their	grant	date fair	value	as	computed	in	accordance	with	FASB	ASC	Topic	718.	For	a	discussion	of	the	assumptions	made	in	the	valuation	of	the	stock	option	awards	in	this	column,	see	Note	12,	Employees' Stock	Incentive	Plans,	in	Item	8,	Financial	Statements	and	Supplementary	Data .

(5) Amounts	reported	in	this	column	reflect	compensation	earned	for	2018	performance	under	our	PBP.	As	discussed	in	the	CD&A	and	consistent	with	our	pay	for	performance	philosophy,	due	to	the difficult	operating	environment	in	2018	and	the	Company's	financial	performance,	Messrs.	Hees,	Knopf,	and	Basilio	asked	to	forfeit	their	rights	to	the	amounts	payable	pursuant	to	the	PBP	with respect	to	fiscal	year	2018	and	the	Committee	approved	their	forfeitures.	The	bonuses	were	paid	in	cash	to	each	other	NEO	after	the	end	of	2018.

(6) For	Mr.	Hees,	represents	dividend	equivalents	that	accrued	on	Matching	RSUs	($128,176),	a	matching	contribution	to	the	Kraft	Heinz	401(k),	and	basic	life	insurance	coverage.	For	Mr.	Knopf, represents	a	matching	contribution	to	the	Kraft	Heinz	401(k),	dividend	equivalents	that	accrued	on	Matching	RSUs,	and	basic	life	insurance	coverage.	For	Mr.	Basilio,	represents	dividend equivalents	that	accrued	on	Matching	RSUs	($63,609),	a	matching	contribution	to	the	Kraft	Heinz	401(k),	and	basic	life	insurance	coverage.	For	Mr.	Oliveira,	represents	dividend	equivalents	that accrued	on	Matching	RSUs	($42,298),	tax	support,	and	a	matching	contribution	to	the	UK	contribution	scheme.	For	Ms.	La	Lande,	represents	payment	for	relocation	expenses	($66,664),	a matching	contribution	to	the	Kraft	Heinz	401(k),	and	basic	life	insurance	coverage.

(7) To	supplement	the	SEC-required	disclosure	in	the	other	columns	of	the	2018	Summary	Compensation	Table,	we	have	included	this	additional	column,	which	shows	"Total	Compensation	as Adjusted	from	SEC	Rules"	representing	the	portion	of	the	"Total	Compensation"	available	to	each	NEO	in	each	of	the	years	shown.	We	are	presenting	this	supplemental	column	to	show	how	the Committee	views	the	NEOs'	compensation	for	each	of	the	years	shown.	The	"Total	Compensation"	column	as	calculated	under	SEC	rules	includes	several	items	that	are	not	necessarily	reflective of	compensation	available	to	the	NEOs	in	a	particular	year.	Amounts	reported	in	the	"Total	Compensation	as	Adjusted	from	SEC	Rules"	column	differ	substantially	from	the	amounts	determined under	SEC	rules	as	reported	in	the	"Total	Compensation"	column.	"Total	Compensation	as	Adjusted	from	SEC	Rules"	is	not	a	substitute	for	"Total	Compensation."	"Total	Compensation	as Adjusted	from	SEC	Rules"	represents:	(1)	"Total	Compensation,"	as	calculated	under	applicable	SEC	rules,	minus	(2)	the	aggregate	grant	date	fair	value	of	equity	awards	(as	reflected	in	the "Stock	Awards"	and	"Option	Awards"	columns),	and	plus	(3)	the	value	realized	from	any	exercise	of	stock	options	and	the	vesting	of	RSUs	or	PSUs	before	payment	of	any	applicable	withholding taxes	and	brokerage	commissions	(as	reflected	in	the	Option	Exercises	and	Stock	Vested	tables	of	the	proxy	statements	for	the	respective	years),	including	the	value	realized	from	the	payment	of any	dividend	equivalents.	In	addition,	"Total	Compensation	as	Adjusted	from	SEC	Rules"	reflects	any	bonus	paid	in	each	of	the	years	shown,	whereas	the	"Total	Compensation"	column	calculated pursuant	to	the	SEC	rules	reflects	any	bonus	earned	for	the	applicable	years	(regardless	of	when	paid	and	not	taking	into	account	any	subsequent	forfeitures	thereof).

(8) Foreign	currency	conversion	based	on	daily	average	for	calendar	year	2018.	Mr.	Oliveira's	base	salary	is	paid	in	British	pounds.	The	amounts	shown	in	the	table	above	are	based	on	the	following 12-month	average	exchange	rate:	British	pounds	(.7499	USD/GBP).

# Grants	of	Plan-Based	Awards	Table

The	following	table	sets	forth	information	regarding	the	grant	of	plan-based	awards	for	each	of	the	NEOs	in	2018.	As	described	in	the	CD&A,	due	to	the	difficult operating	environment	in	2018	and	the	Company's	financial	performance,	Messrs.	Hees,	Knopf,	and	Basilio	have	forfeited	their	rights	to	the	amounts	payable	pursuant	to the	PBP	with	respect	to	fiscal	year	2018.

|  |  |  | Estimated	Future	Payouts	Under |  | Estimated	Future	Payouts	Under	Equity	Incentive | Estimated	Future	Payouts	Under	Equity	Incentive | Estimated	Future	Payouts	Under	Equity	Incentive | All	Other | All	Other |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  | Non-Equity\tIncentive\tPlan\tAwards |  |  | Plan\tAwards(4) |  | Stock | Option |  |  |
|  |  |  |  |  |  |  |  | Awards: | Awards: |  |  |
|  |  |  |  |  |  |  |  | Number\tof | Number\tof | Exercise | Grant\tDate\tFair |
|  |  |  |  |  |  |  |  | Shares\tof | Securities | Price\tof | Value\tof\tStock |
|  |  |  |  |  |  |  |  | Stock\tor | Under\tlying | Option | and\tOption |
| Grant | Grant | Threshold | Target | Maximum | Threshold | Target | Maximum | Units | Options | Awards | Awards |
| Date(3) | Type | ($) | ($) | ($) | (#) | (#) | (#) | (#) | (#) | ($/Share) | ($) |
|  | PBP(1) | 900,000 | 2,700,000 | 3,000,000 |  |  |  |  |  |  |  |
| 3/1/18 | RSUs(2) |  |  |  |  |  |  | 134,550 |  |  | 7,645,131 |
| 3/1/18 | PSUs(5) |  |  |  | 251,159 | 313,949 | 376,739 |  |  |  | 17,838,582 |
|  | PBP(1) | 262,500 | 787,500 | 875,000 |  |  |  |  |  |  |  |
| 3/1/18 | RSUs |  |  |  |  |  |  | 31,395 |  |  | 1,783,864 |
| 3/1/18 | PSUs(5) |  |  |  | 58,604 | 73,255 | 87,906 |  |  |  | 4,162,349 |
| 3/1/18 | Options |  |  |  |  |  |  |  | 44,850 | 66.89 | 497,835 |
|  | PBP(3) | 562,500 | 1,687,500 | 1,875,000 |  |  |  |  |  |  |  |
| 3/1/18 | RSUs |  |  |  |  |  |  | 89,700 |  |  | 5,096,754 |
| 3/1/18 | PSUs(5) |  |  |  | 167,439 | 209,299 | 251,159 |  |  |  | 11,892,369 |
|  | PBP(4) | 319,783 | 950,772 | 1,031,636 |  |  |  |  |  |  |  |
|  | Matching |  |  |  |  |  |  |  |  |  |  |
| 3/1/18 | RSUs |  |  |  |  |  |  | 6,622 |  |  | 442,946 |
| 3/1/18 | RSUs |  |  |  |  |  |  | 44,850 |  |  | 2,548,377 |
| 3/1/18 | PSUs(5) |  |  |  | 83,720 | 104,650 | 125,580 |  |  |  | 5,946,213 |
|  | PBP(1) | 275,625 | 826,875 | 918,750 |  |  |  |  |  |  |  |
| 3/1/18 | RSUs |  |  |  |  |  |  | 26,163 |  |  | 1,486,582 |
| 3/1/18 | PSUs(5) |  |  |  | 20,930 | 26,163 | 31,396 |  |  |  | 1,486,582 |
| 3/1/18 | Options |  |  |  |  |  |  |  | 52,325 | 66.89 | 580,808 |

(1) For	Messrs.	Hees	and	Knopf	and	Ms.	La	Lande,	the	PBP	is	based	on	global	change	in	Adjusted	Net	Income	and	has	a	Threshold	assumption	of	60%	and	Maximum	assumption	of	100%.	Threshold amounts	also	assume	a	minimum	individual	MBO	Score	of	50%,	while	Target	and	Maximum	amounts	assume	an	individual	MBO	Score	of	100%.	The	actual	payment	would	be	based	on achievement	of	individual	and	financial	performance	goals.	Annual	incentive	award	payments,	to	the	extent	not	forfeited,	were	made	in	cash	to	each	NEO	after	the	end	of	2018	based	on	actual results	achieved.	Actual	amounts	earned	are	reflected	in	the	Summary	Compensation	Table	under	Non-Equity	Incentive	Plan	Compensation.

(2) On	April	22,	2019,	we	announced	that	Mr.	Hees	would	leave	Kraft	Heinz	in	2019.	As	a	result	of	his	departure,	Mr.	Hees	will	forfeit	the	RSU	award	granted	in	2018.

(3) For	Mr.	Basilio,	the	US	Zone	PBP	is	based	75%	on	change	in	U.S.	NSV	and	25%	on	change	in	U.S.	Segment	Adjusted	EBITDA	and	has	a	Threshold	assumption	of	60%,	and	Maximum assumption	of	90%	for	NSV	change	and	130%	for	Segment	Adjusted	EBITDA	change.	Threshold	amounts	also	assume	an	individual	MBO	Score	of	50%,	while	Target	and	Maximum	amounts assume	an	individual	MBO	Score	of	100%.	Mr.	Basilio's	actual	payment	is	based	on	achievement	of	individual	goals	and	would	receive	a	weighting	on	financial	performance	split	by	70%	of	the US	Zone	metrics	plus	30%	of	the	global	metrics.	Annual	incentive	award	payments,	to	the	extent	not	forfeited,	were	made	in	cash	to	each	NEO	after	the	end	of	2018	based	on	actual	results achieved.	Actual	amounts	earned	are	reflected	in	the	Summary	Compensation	Table	under	Non-Equity	Incentive	Plan	Compensation.

(4) For	Mr.	Oliveira,	the	EMEA	Zone	PBP	is	based	75%	on	change	in	EMEA	NSV	and	25%	on	change	in	EMEA	Segment	Adjusted	EBITDA	and	has	a	Threshold	assumption	of	70%	for	NSV change	and	60%	for	Segment	Adjusted	EBITDA	change,	and	Maximum	assumption	of	100%	for	NSV	change	and	130%	for	Segment	Adjusted	EBITDA	change.	Threshold	amounts	also	assume an	individual	MBO	Score	of	50%,	while	Target	and	Maximum	amounts	assume	an	individual	MBO	Score	of	100%.	Mr.	Oliveira's	actual	payment	is	based	on	achievement	of	individual	goals	and will	receive	a	weighting	on	financial	performance	split	by	70%	of	the	EMEA	Zone	metrics	plus	30%	of	the	global	metrics.	Annual	incentive	award	payments,	to	the	extent	not	forfeited,	were	made in	cash	 to	each	NEO	after	 the	end	of	2018	based	on	actual	results	achieved.	Actual	amounts	earned	are	reflected	 in	 the	Summary	Compensation	Table	under	Non-Equity	Incentive	Plan Compensation.

(5) The	PSUs	granted	on	March	1,	2018	were	granted	under	the	2016	Omnibus	Incentive	Plan.	The	target	number	of	shares	shown	in	the	table	reflects	the	number	of	shares	of	common	stock	that	will be	earned	if	each	of	the	performance	metrics	are	achieved	at	target	levels	by	the	end	of	2020.	If	80%	of	the	performance	metrics	are	not	achieved	by	the	end	of	2020,	the	target	and	threshold opportunities	roll	over	to	2021	with	a	20	percentage	point	payout	penalty.	Actual	shares	awarded	will	vest	on	March	1,	2023	provided	the	awardee	also	meets	certain	requirements.	Dividends	are not	earned	on	the	PSUs.	As	of	December	29,	2018,	due	to	the	performance	of	our	business,	the	expected	payout	of	the	PSUs	was	determined	to	be	zero.

# Outstanding	Equity	Awards	at	Fiscal	Year-End	Table

The	following	table	sets	forth	each	NEO's	outstanding	equity	awards,	as	of	the	end	of	2018.

|  |  |  |  |  |  |  |  |  |  |  | Market |  | Plan |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  |  |  |  |  |  |  |  |  |  |  | Value |  | Awards: |  |  |  |
|  |  |  |  |  |  |  |  |  | Number\tof |  | of |  | Number\tof |  | Equity\tIncentive |  |
|  |  |  |  |  |  |  |  |  | Shares |  | Shares |  | Unearned |  | Plan\tAwards: |  |
|  |  |  |  |  |  |  |  |  | or |  | or |  | Shares, |  | Market\tor |  |
|  |  |  | Number |  | Number |  |  |  | Units\tof |  | Units\tof |  | Units\tor |  | Payout |  |
|  |  |  | of\tSecurities |  | of\tSecurities |  |  |  | Stock |  | Stock |  | Other |  | Value\tof\tUnearned |  |
|  |  |  | Underlying |  | Underlying |  |  |  | That |  | That |  | Rights |  | Shares, |  |
|  |  |  | Unexercised |  | Unexercised |  | Option |  | Have |  | Have |  | That |  | Units\tor\tOther |  |
|  |  |  | Options |  | Options |  | Exercise | Option | Not |  | Not |  | Have\tNot |  | Rights\tThat\tHave |  |
|  |  |  | Exercisable |  | Unexercisable |  | Price | Expiration | Vested |  | Vested(2) |  | Vested |  | Not\tVested(2) |  |
| Name | Grant\tDate | Grant\tType | (#) |  | (#) |  | ($) | Date | (#) |  | ($) |  | (#) |  | ($) |  |
| Mr.\tHees | 3/1/18 | RSUs |  |  |  |  |  |  | 134,550 | (12) | 5,862,344 | (14) |  |  |  |  |
|  | 3/1/18 | PSUs |  |  |  |  |  |  |  |  |  |  | 251,159 | (13) | 10,943,006 | (13) |
|  |  | RSU- |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 3/1/17 | match |  |  |  |  |  |  | 32,118 | (1) | 1,399,381 |  |  |  |  |  |
|  |  | RSU- |  |  |  |  |  |  |  | (1) | 899,198 |  |  |  |  |  |
|  | 3/1/16 | match |  |  |  |  |  |  | 20,638 |  |  |  |  |  |  |  |
|  |  | Stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 8/20/15 | Options |  |  | 202,021 | (3) | 74.25 | 8/20/25 |  |  |  |  |  |  |  |  |
|  | 2/12/15 | Option-\nmatch |  |  | 71,819 | (4) | 30.46 | 2/12/25 |  |  |  |  |  |  |  |  |
|  | 2/14/14 | Option-\nmatch |  |  | 98,951 | (5) | 22.56 | 2/14/24 |  |  |  |  |  |  |  |  |
|  |  | Stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 7/1/13 | Options | 1,329,996 | (6) |  |  | 22.56 | 7/1/23 |  |  |  |  |  |  |  |  |
| Mr.\nKnopf | 3/1/18 | RSUs |  |  |  |  |  |  | 31,395 | (12) | 1,367,880 |  |  |  |  |  |
|  | 3/1/18 | PSUs |  |  |  |  |  |  |  |  |  |  | 58,604 | (13) | 2,553,376 |  |
|  |  | Stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 3/1/18 | Options |  |  | 44,850 | (11) | 66.89 | 3/1/28 |  |  |  |  |  |  |  |  |
|  |  | RSU- |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 3/1/17 | match |  |  |  |  |  |  | 2,530 | (1) | 110,232 |  |  |  |  |  |
|  |  | Stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 3/1/17 | Options |  |  | 21,875 | (7) | 91.43 | 3/1/27 |  |  |  |  |  |  |  |  |
|  | 3/1/17 | PSUs |  |  |  |  |  |  |  |  |  |  | 19,687 | (8) | 857,771 |  |
|  |  | RSU- |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 3/1/16 | match |  |  |  |  |  |  | 967 | (1) | 42,132 |  |  |  |  |  |
|  |  | Stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 8/20/15 | Options |  |  | 67,341 | (3) | 74.25 | 8/20/25 |  |  |  |  |  |  |  |  |
| Mr.\nBasilio | 3/1/18 | RSUs |  |  |  |  |  |  | 89,700 | (12) | 3,908,229 |  |  |  |  |  |
|  | 3/1/18 | PSUs |  |  |  |  |  |  |  |  |  |  | 167,439 | (13) | 7,295,326 |  |
|  |  | RSU- |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 3/1/17 | match |  |  |  |  |  |  | 17,643 | (1) | 768,706 |  |  |  |  |  |
|  |  | RSU- |  |  |  |  |  |  |  | (1) | 372,044 |  |  |  |  |  |
|  | 3/1/16 | match |  |  |  |  |  |  | 8,539 |  |  |  |  |  |  |  |
|  |  | Stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 8/20/15 | Options |  |  | 134,681 | (3) | 74.25 | 8/20/25 |  |  |  |  |  |  |  |  |
|  | 2/12/15 | Option-\nmatch |  |  | 41,377 | (4) | 30.46 | 2/12/25 |  |  |  |  |  |  |  |  |
|  | 2/14/14 | Option-\nmatch |  |  | 38,257 | (5) | 22.56 | 2/14/24 |  |  |  |  |  |  |  |  |
|  |  | Stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | 7/1/13 | Options | 531,998 | (6) |  |  | 22.56 | 7/1/23 |  |  |  |  |  |  |  |  |

| Oliveira | 3/1/18 | RSUs |  |  |  |  | 44,850 | (12) | 1,954,115 |  |  |  |
| :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- |
|  | 3/1/18 | PSUs |  |  |  |  |  |  |  | 83,720 | (13) | 3,647,680 |
|  |  | RSU- |  |  |  |  |  |  |  |  |  |  |
|  | 3/1/18 | match |  |  |  |  | 6,920 | (1) | 301,504 |  |  |  |
|  |  | RSU- |  |  |  |  |  |  |  |  |  |  |
|  | 3/1/17 | match |  |  |  |  | 3,567 | (1) | 155,414 |  |  |  |
|  |  | Stock |  |  |  |  |  |  |  |  |  |  |
|  | 3/1/17 | Options | 27,344 | (7) | 91.43 | 3/1/27 |  |  |  |  |  |  |
|  |  | RSU- |  |  |  |  |  |  |  |  |  |  |
|  | 3/1/16 | match |  |  |  |  | 6,923 | (1) | 301,635 |  |  |  |
|  |  | Stock |  |  |  |  |  |  |  |  |  |  |
|  | 3/1/16 | Options | 32,192 | (9) | 77.66 | 3/1/26 |  |  |  |  |  |  |
|  |  | Option- |  |  |  |  |  |  |  |  |  |  |
|  | 2/12/15 | match | 4,492 | (4) | 30.46 | 2/12/25 |  |  |  |  |  |  |
|  |  | Stock |  |  |  |  |  |  |  |  |  |  |
|  | 2/12/15 | Options | 16,419 | (4) | 30.46 | 2/12/25 |  |  |  |  |  |  |
|  |  | Stock |  |  |  |  |  |  |  |  |  |  |
|  | 5/21/14 | Options | 110,833 | (10) | 22.56 | 5/21/24 |  |  |  |  |  |  |
| Ms.\tLa\nLande | 3/1/18 | RSUs |  |  |  |  | 26,163 | (12) | 1,139,922 |  |  |  |
|  | 3/1/18 | PSUs |  |  |  |  |  |  |  | 20,930 | (13) | 911,938 |
|  |  | Stock |  |  |  |  |  |  |  |  |  |  |
|  | 3/1/18 | Options | 52,325 | (11) | 66.89 | 3/1/28 |  |  |  |  |  |  |

(1) For	all	Matching	RSUs,	this	total	includes	dividends	that	are	reinvested	at	the	dividend	payment	date	in	additional	RSUs	that	are	subject	to	the	same	restrictions	as	the	original	grant.	The Matching	RSUs	granted	on	March	1,	2016,	March	1,	2017,	and	March	1,	2018	are	scheduled	to	vest	on	the	fifth	anniversary	of	the	grant	date.

(2) The	market	value	of	the	shares	that	have	not	vested	is	based	on	the	closing	price	of	$43.57	for	Kraft	Heinz	common	stock	on	December	28,	2018,	the	last	trading	day	of	our	fiscal	year,	as reported	on	Nasdaq.

(4) 100%	of	these	awards	are	scheduled	to	vest	on	February	12,	2020.	Options	and	exercise	price	reflect	the	conversion	in	connection	with	the	2015	Merger.

(5) 100%	of	these	awards	vested	on	February	14,	2019,	and	they	are	scheduled	to	expire	on	February	14,	2024.	Options	and	exercise	price	reflect	the	conversion	in	connection	with	the	2015	Merger.

(6) 100%	of	these	awards	vested	on	July	1,	2018,	and	they	are	scheduled	to	expire	on	July	1,	2023.	Options	and	exercise	price	reflect	the	conversion	in	connection	with	the	2015	Merger.

(8) As	of	December	29,	2018,	due	to	the	performance	of	our	business,	the	expected	payout	of	the	PSUs	was	determined	to	be	zero. 	The	shares	reported	in	this	row	represent	potentially	issuable	shares under	the	PSU	award	granted	on	March	1,	2017,	which	cliff	vest	on	March	1,	2022.	The	PSUs	represent	the	right	to	receive	a	variable	number	of	Kraft	Heinz	shares	based	on	Kraft	Heinz's	actual performance	during	a	define	performance	period.	If	80%	of	the	performance	target	is	achieved	in	2019,	the	participant	will	receive	70%	of	the	underlying	shares.	If	80%	of	the	performance	target is	achieved	in	2020,	participant	will	receive	65%	of	the	underlying	shares	and	if	80%	of	the	performance	target	is	achieved	in	2021,	the	participant	will	receive	60%	of	the	underlying	shares.	The number	of	shares	reported	in	this	row	is	based	on	threshold	performance.	Dividend	equivalents	do	not	accrue	on	the	PSUs.	If	the	participant	is	terminated	prior	to	March	1,	2020,	he	or	she	will forfeit	the	entire	award.	The	PSUs	will	vest	as	earned	on	March	1,	2022.

(10) 100%	of	the	award	is	scheduled	to	vest	on	May	21,	2019.	Options	and	exercise	price	reflect	the	conversion	in	connection	with	the	2015	Merger.

(12) 100%	of	these	awards	are	scheduled	to	vest	on	March	1,	2023,	and	the	RSU	awards	are	not	dividend	eligible.

(13) As	of	December	29,	2018,	due	to	the	performance	of	our	business,	the	expected	payout	of	the	PSUs	was	determined	to	be	zero. 	The	shares	reported	in	these	rows	represent	potentially	issuable shares	under	the	PSU	award	granted	on	March	1,	2018,	which	cliff	vest	on	March	1,	2023.	The	PSUs	represent	the	right,	to	the	extent	not	forfeited,	to	receive	a	variable	number	of	Kraft	Heinz shares	based	on	Kraft	Heinz's	actual	performance	during	a	defined	performance	period.	If	the	threshold	of	the	performance	target	is	achieved	by	the	end	of	2020,	the	participant	will	receive	80% of	the	underlying	shares.	If	the	threshold	for	the	performance	target	is	not	achieved	by	the	end	of	2020,	the	target	and	threshold	opportunities	roll	over	to	2021	with	a	20	percentage	point	payout penalty.	The	number	of	shares	reported	in	these	rows	is	based	on	threshold	performance.	Dividend	equivalents	do	not	accrue	on	the	PSUs.	If	the	participant	is	terminated	prior	to	March	1,	2021, he	or	she	will	forfeit	the	entire	award.	The	PSUs	will	vest	as	earned	on	March	1,	2023	provided	the	awardee	also	meets	certain	requirements.

# Option	Exercises	and	Stock	Vested	Table

There	were	no	stock	options	exercised	nor	did	any	RSUs	vest	for	any	NEO	in	2018.

# Pension	Benefits	Table

None	of	our	NEOs	participate	in	any	defined	benefit	pension	arrangements.

# Nonqualified	Deferred	Compensation	Table

None	of	our	NEOs	participate	in	any	nonqualified	deferred	compensation	arrangements.

# Potential	Payments	Upon	Termination	or	Change	in	Control	Table

The	table,	footnotes,	and	narratives	below	reflect	the	assumption	that	a	hypothetical	termination	of	employment	or	change	in	control	occurred	on	the	last	day	of	2018.

| Salary | 1,000,000 | — |
| :--- | :--- | :--- |
| Bonus(5) | — | 1,060,000 |
| Intrinsic\tValue\tof\tAccelerated\tEquity(3) | 2,587,776 | 2,587,776 |
| Health\t&amp;\tWelfare\tBenefits(4) | 14,586 | — |
| Outplacement | 3,200 | — |
| Total | 3,605,562 | 3,647,776 |
| Salary | 500,000 | — |
| Bonus | — | 500,000 |
| Intrinsic\tValue\tof\tAccelerated\tEquity(3) | 16,853 | 16,853 |
| Health\t&amp;\tWelfare\tBenefits(4) | 14,258 | — |
| Outplacement | 3,200 | — |
| Total | 534,311 | 516,853 |
| Salary | 750,000 | — |
| Bonus | — | 1,023,000 |
| Intrinsic\tValue\tof\tAccelerated\tEquity(3) | 1,117,313 | 1,117,313 |
| Health\t&amp;\tWelfare\tBenefits(4) | 14,586 | — |
| Outplacement | 3,200 | — |
| Total | 1,885,099 | 2,140,313 |
| Salary | 560,101 | — |
| Bonus | — | 733,854 |
| Intrinsic\tValue\tof\tAccelerated\tEquity(3) | 2,148,021 | 2,148,021 |
| Health\t&amp;\tWelfare\tBenefits(4) | 2,556 | — |
| Outplacement | 3,193 | — |
| Total | 2,713,871 | 2,881,875 |
| Salary | 650,000 | — |
| Bonus | — | 543,000 |
| Intrinsic\tValue\tof\tAccelerated\tEquity(3) | — | — |
| Health\t&amp;\tWelfare\tBenefits(4) | 14,586 | — |
| Outplacement | 3,200 | — |
| Total | 667,786 | 543,000 |

(1) No	enhanced	severance	is	provided	on	a	termination	in	connection	with	a	change	in	control.	Kraft	Heinz	does	not	have	a	specified	Change	in	Control	Plan	for	executives,	and	treatment	is determined	by	the	plan	agreements	and	local	regulations	applicable	to	each	employee.	Our	Severance	Pay	Plan	generally	provides	for	12	months	of	base	salary	with	a	signed	release	of	claims.	The Severance	Pay	Plan	would	also	include	Company-paid	COBRA	for	U.S.-based	employees	for	the	severance	period	and	outplacement	services.

(2) Relates	to	termination	due	to	death,	disability,	or	normal	retirement.

(3) As	of	the	last	day	of	2018,	in	the	event	of	a	termination	without	cause	or	due	to	retirement,	death,	or	disability,	stock	options	vest	as	if	20%	of	the	options	vested	on	each	annual	anniversary	date	of the	specific	grant.	Amounts	reflect	the	intrinsic	value	of	shares	underlying	options	that	would	vest,	calculated	as	the	difference	between	$43.57,	the	closing	price	of	Kraft	Heinz	common	stock	on December	28,	2018	(the	last	trading	day	of	our	fiscal	year,	as	reported	on	Nasdaq),	and	the	exercise	price	of	the	options.	Amounts	also	include	the	vesting	of	Matching	RSUs	granted	in	2016	at	a pro	rata	rate	of	20%	of	the	RSUs	as	if	they	vested	on	each	annual	anniversary	date	of	the	grant.	The	2017	Matching	RSUs	and	2018	RSUs	and	Matching	RSUs	are	not	presented	in	this	table because	no	pro	rata	vesting	would	occur	if	such	event	occurs	prior	to	the	second	anniversary	of	the	grant.

(4) Amount	reflects	12	months	of	medical	and	dental	benefit	coverage	continuation	under	COBRA,	less	the	executive	premium	contribution.	As	noted	in	the	CD&A,	due	to	the	difficult	operating environment	in	2018	and	the	Company's	financial	performance,	Messrs.	Hees,	Knopf,	and	Basilio	asked	to	forfeit	their	rights	to	the	amounts	payable	pursuant	to	the	PBP	with	respect	to	fiscal	year 2018	and	the	Committee	approved	their	forfeitures.

(5) The	Committee	and	Board	approved	a	bonus	to	Mr.	Hees	in	connection	with	his	separation	from	the	Company,	$1,084,000,	which	represents	his	pro	rata	portion	of	his	2019	bonus	based	on	an 85%	performance	rating	and	85%	Individual	Rating.

# Severance	Pay	Plan

Generally,	Kraft	Heinz	provides	for	severance	benefits	to	U.S.-based	salaried	employees,	including	our	U.S.-based	NEOs,	pursuant	to	the	terms	of	the	U.S.	Severance Pay	Plan.	The	severance	benefits	for	non-U.S.-based	salaried	employees	are	made	pursuant	to	the	local	laws	and	regulations	governing	the	jurisdiction	in	which	they work,	subject	to	adjustment	at	the	discretion	of	Kraft	Heinz	for	employees	at	certain	organizational	levels	(such	benefits,	together	with	the	U.S.	Severance	Pay	Plan,	are referred	to	as	the	"Severance	Pay	Plan").

NEOs	are	eligible	for	severance	benefits	under	the	Severance	Pay	Plan	upon	an	involuntary	termination	of	employment,	such	as	job	elimination,	location	closing,	or reduction	in	the	workforce.	NEOs	must	be	willing	to	provide	satisfactory	transitional	assistance	in	order	to	be	eligible	for	severance	benefits.

Pursuant	to	the	U.S.	Severance	Pay	Plan,	Messrs.	Hees,	Basilio,	and	Knopf	and	Ms.	La	Lande	would	generally	be	eligible	to	receive	a	severance	payment	equal	to	12 months	of	base	salary	upon	the	execution	of	a	release	of	claims	against	Kraft	Heinz.	In	addition,	the	Committee	may,	in	its	sole	discretion,	authorize	payment	of additional	severance	in	respect	of	a	participant's	annual	bonus	opportunity.	Although	Mr.	Oliveira	is	not	based	in	the	U.S.	and	not	otherwise	covered	by	the	U.S. Severance	Pay	Plan,	the	Company	has	determined	that	he	is	eligible	to	receive	the	same	benefits	as	the	other	NEOs.	Severance	payments	are	generally	made	in	a	cash lump-sum,	but	may	occasionally	be	made	in	periodic	payments	at	Kraft	Heinz's	discretion	as	soon	as	administratively	feasible	after	the	termination	of	employment	and after	the	former	NEO's	executed	release	has	become	irrevocable.

On	April	22,	2019,	Kraft	Heinz	announced	that	Mr.	Hees	would	leave	Kraft	Heinz	in	2019.	On	June	5,	2019,	the	Committee	approved	the	following	severance	terms	for Mr.	Hees,	which	will	become	payable	following	Mr.	Hees's	termination	of	employment	and	subject	to	his	execution	of	a	release	of	claims	against	Kraft	Heinz:	(1)	a severance	payment	equal	to	12	months	of	base	salary,	and	(2)	a	pro-rata	payment	of	his	annual	bonus	under	the	PBP	assuming	performance	at	85%,	both	with	respect	to the	metrics	related	to	Kraft	Heinz's	financial	performance	(i.e.,	the	"Financial	Multiplier")	and	Mr.	Hees's	MBOs	(i.e.,	the	"Individual	Rating").	Mr.	Hees'	outstanding equity	awards	will	be	treated	in	accordance	with	the	terms	set	forth	in	the	governing	agreements	as	described	below.

No	enhanced	severance	is	provided	on	a	termination	in	connection	with	a	change	in	control	of	Kraft	Heinz,	and	Kraft	Heinz	does	not	maintain	any	individual	change	in control	severance	or	other	similar	agreements	with	any	of	the	NEOs.	None	of	the	NEOs	are	entitled	to	receive	a	gross-up	for	golden	parachute	taxes	that	may	become payable	pursuant	to	Section	280G	of	the	Code	in	connection	with	a	change	in	control	of	Kraft	Heinz.

# Equity	Awards

Generally,	as	of	the	last	day	of	2018,	in	the	event	of	involuntary	termination	without	cause,	retirement,	death,	and	disability,	the	stock	options	granted	to	the	NEOs	would vest	as	if	20%	of	the	shares	vested	on	each	annual	anniversary	date	of	the	specific	grant,	and	for	all	other	terminations	and	for	voluntary	resignations,	the	unvested	stock options	would	be	forfeited.	In	addition,	as	of	the	last	day	of	2018,	beginning	on	the	termination	date,	the	exercise	period	was	90	days	for	termination	without	cause	and one	year	for	retirement,	death,	and	disability.	In	April	2019,	the	Committee	modified	award	agreements	for	outstanding	equity	awards	(options,	PSUs,	Matching	RSUs, and	RSUs)	with	respect	to	the	treatment	upon	a	termination	due	to	death,	disability,	or	retirement.	Such	terminations,	for	option	awards	on	or	after	the	first	anniversary	of the	specific	grant	date,	and	for	RSU	and	Matching	RSU	awards	on	or	after	the	anniversary	deadlines	outlined	in	the	award	agreements,	would	result	in	such	awards	being fully	vested	and	exercisable,	in	the	case	of	PSUs,	to	the	extent	the	performance	conditions	had	been	satisfied.	In	addition,	the	Committee	modified	award	agreements	for outstanding	options	such	that	the	exercise	period	for	a	termination	without	cause	would	be	one	year.

# PAY	RATIO	DISCLOSURE

In	accordance	with	Item	402(u)	of	Regulation	S-K,	promulgated	by	the	Dodd-Frank	Wall	Street	Reform	Act	and	Consumer	Protection	Act	of	2010,	we	determined	the ratio	of	the	annual	total	compensation	of	Mr.	Hees	relative	to	the	annual	total	compensation	of	our	median	employee.

For	purposes	of	reporting	annual	total	compensation	and	the	ratio	of	annual	total	compensation	of	the	CEO	to	the	median	employee,	both	the	CEO	and	median employee's	annual	total	compensation	were	calculated	consistent	with	the	disclosure	requirements	of	executive	compensation	under	the	Summary	Compensation	Table.

Pursuant	 to	 Item	 402(u)	 of	 Regulation	 S-K	 and	 the	 instructions	 thereto,	 because	 there	 has	 been	 no	 significant	 change	 in	 our	 employee	 population	 or	 employee compensation	arrangements	that	we	reasonably	believe	would	result	in	a	significant	change	to	our	pay	ratio	disclosure,	we	are	utilizing	the	same	median-compensated employee	in	our	pay	ratio	calculation	as	was	used	in	2017.	Our	median-compensated	employee	is	a	full-time	hourly	non-U.S.	factory	employee.

To	identify	our	median	employee	last	year,	we	determined	the	annual	total	compensation	by	examining	the	2017	annualized	base	salaries	plus	target	incentive	bonus	for all	individuals,	excluding	our	Chief	Executive	Officer,	who	were	employed	by	us	as	of	December	1,	2017.	In	accordance	with	Item	402(u)	and	instructions	thereto,	we included	all	full-time,	part-time,	temporary,	and	seasonal	employees	worldwide.	We	believe	the	use	of	base	salaries	plus	target	incentive	bonus	for	all	employees	is	a consistently	applied	compensation	measure,	because	we	do	not	widely	distribute	annual	equity	awards	to	employees	and	because	we	believe	that	this	measure	reasonably reflects	the	total	annual	compensation	of	our	employees.

After	applying	the	methodology	described	above,	our	median	employee	compensation	using	the	Summary	Compensation	Table	requirements	was	$47,612.	Our	CEO's compensation	in	the	Summary	Compensation	Table	was	$29,047,768.	Therefore,	our	CEO	to	median	employee	pay	ratio	("CEO	pay	ratio"),	a	reasonable	estimate calculated	in	a	manner	consistent	with	Item	402(u),	is	610:1.	The	CEO's	total	compensation	of	$29,047,768	included	$1,060,000	payable	pursuant	to	the	PBP	for	2018, as	well	as	$17,838,582	related	to	the	grant	date	fair	value	of	PSUs.	As	noted	above,	Mr.	Hees	has	decided	to	forfeit	the	PBP	for	2018,	and	as	of	December	29,	2018,	the expected	payout	of	those	PSUs	was	determined	to	be	zero	based	on	the	probability	of	future	achievement	of	performance	metrics.	If	we	had	excluded	the	PBP	payout	for 2018	and	the	March	2018	PSUs	from	total	CEO	compensation,	the	CEO	pay	ratio	would	have	been	213:1.

# Item	12.	Security	Ownership	of	Certain	Beneficial	Owners	and	Management	and	Related	Stockholder	Matters.

# SECURITIES	AUTHORIZED	FOR	ISSUANCE	UNDER	EQUITY	COMPENSATION	PLANS

The	number	of	shares	to	be	issued	upon	exercise	or	vesting	of	awards	issued	under,	and	the	number	of	shares	remaining	available	for	future	issuance	under	our	equity compensation	plans	at	December	29,	2018	were:

|  | Number	of	securities	to<br>be	issued	upon	exercise<br>of	outstanding	options,<br>warrants	and	rights(1) | Weighted	average	exercise	price	per	share	of<br>outstanding	options,	warrants	and	rights | Number	of	securities<br>remaining	available	for<br>future	issuance	under<br>equity	compensation	plans<br>(excluding	securities<br>reflected	in	column	(a)) |
| :--- | :--- | :--- | :--- |
| Plan\tCategory | (a) | (b) | (c) |
| Equity\tcompensation\tplans\tapproved\tby\nsecurity\tholders | 23,858,121 | $44.64 | 43,920,379 |
| Equity\tcompensation\tplans\tnot\tapproved\nby\tsecurity\tholders | — | — | — |
| Total | 23,858,121 |  | 43,920,379 |

# (1) Includes	the	vesting	of	RSUs.

# OWNERSHIP	OF	EQUITY	SECURITIES

The	following	table	shows	the	number	of	shares	of	our	common	stock	beneficially	owned	as	of	June	5,	2019,	unless	otherwise	noted,	by	each	current	director,	director nominee,	and	Named	Executive	Officer,	as	well	as	the	number	of	shares	beneficially	owned	by	all	of	our	current	directors	and	executive	officers	as	a	group.	None	of	our common	stock	owned	by	these	individuals	is	subject	to	any	pledge.	Unless	otherwise	indicated,	each	of	the	named	individuals	has,	to	Kraft	Heinz's	knowledge,	sole voting	and	investment	power	with	respect	to	the	shares	shown.

|  | Beneficially | Deferred |  |
| :--- | :--- | :--- | :--- |
| Name\tof\tBeneficial\tOwner | Owned\tShares(1)\t(2) | Stock(3) | Total |
| Directors\tand\tDirector\tNominees: |  |  |  |
| Gregory\tE.\tAbel | 22,166 | 20,878 | 43,044 |
| Alexandre\tBehring | 44,333 | 30,479 | 74,812 |
| John\tT.\tCahill(4) | 781,338 | 8,799 | 790,137 |
| Joao\tM.\tCastro-Neves | — | — | — |
| Tracy\tBritt\tCool | 22,166 | 22,261 | 44,427 |
| Feroz\tDewan | — | 6,902 | 6,902 |
| Jeanne\tP.\tJackson | 4,280 | 17,049 | 21,329 |
| Jorge\tPaulo\tLemann | 22,166 | 20,878 | 43,044 |
| John\tC.\tPope | 10,098 | 18,409 | 28,507 |
| Marcel\tHermann\tTelles | 22,166 | 18,494 | 40,660 |
| Alexandre\tVan\tDamme | 6,000 | 2,269 | 8,269 |
| George\tZoghbi | 240,161 | — | 240,161 |
| Named\tExecutive\tOfficers: |  |  | — |
| Bernardo\tHees | 1,486,199 | — | 1,486,199 |
| David\tKnopf | 1,106 | — | 1,106 |
| Paulo\tBasilio | 597,401 | — | 597,401 |
| Rafael\tOliveira | 117,330 | — | 117,330 |
| Rashida\tLa\tLande | — | — | — |
| All\tdirectors\tand\texecutive\tofficers\tas\ta\tgroup\t(19\tpersons)(5) | 3,406,501 | 166,418 | 3,572,919 |

(1) Individual	directors	and	executive	officers	as	well	as	all	directors	and	executive	officers	as	a	group	beneficially	own	less	than	1%	of	our	issued	and	outstanding	common	stock	as	of	June	5,	2019.

(3) Includes	RSUs	and	deferred	shares	held	in	the	stock	deferral	plan	under	the	Kraft	Heinz	Deferred	Compensation	Plan	for	Non-Management	Directors.	These	shares	accumulate	dividends,	which are	reinvested	in	common	stock.	For	a	description	of	these	deferred	shares,	see	"Compensation	of	Non-Employee	Directors"	above.

(4) Mr.	Cahill's	holdings	include	148,321	shares	of	common	stock	held	in	grantor	retained	annuity	trusts.

(5) This	group	includes,	in	addition	to	the	individuals	named	in	the	table,	Pedro	Drevon,	Rodrigo	Wickbold,	and	Nina	Barton,	who	collectively	have	29,591	beneficially	owned	shares	and	exercisable stock	options.

The	following	table	displays	information	about	persons	we	know	were	the	beneficial	owners	of	more	than	5%	of	our	outstanding	common	stock	as	of	June	5,	2019.

| Name	and	Address	of	Beneficial	Owner | Amount	and<br>Nature	of<br>Beneficial<br>Ownership | Percent<br>of<br>Common<br>Stock(1) |
| :--- | :--- | :--- |
| 3G\tFunds(2) |  |  |
| c/o\t3G\tCapital,\tInc. |  |  |
| 600\tThird\tAvenue\t37th\tFloor |  |  |
| New\tYork,\tNew\tYork\t10016 | 270,097,373 | 22.1% |
| Warren\tE.\tBuffett(3) |  |  |
| Berkshire\tHathaway |  |  |
| 3555\tFarnam\tStreet |  |  |
| Omaha,\tNebraska\t68131 | 325,442,152 | 26.7% |

(2) Based	on	the	Schedule	13G/A	filed	on	January	18,	2019	by	(i)	3G	Global	Food	Holdings,	a	Cayman	Islands	limited	partnership,	(ii)	3G	Global	Food	Holdings	GP	LP,	a	Cayman	Islands	limited partnership	("3G	Global	Food	Holdings	GP"),	(iii)	3G	Capital	Partners	II	LP,	a	Cayman	Islands	limited	partnership	("3G	Capital	Partners	II"),	(iv)	3G	Capital	Partners	Ltd.,	a	Cayman	Islands exempted	company	("3G	Capital	Partners	Ltd"),	and	(v)	3G	Capital	Partners	LP,	a	Cayman	Islands	limited	partnership	("3G	Capital	Partners	LP"	and,	together	with	3G	Global	Food	Holdings,	3G Global	Food	Holdings	GP,	3G	Capital	Partners	II	and	3G	Capital	Partners	Ltd,	the	"3G	Funds").	According	to	the	Schedule	13G/A	filing,	the	3G	Funds	own	dispositive	power	over	an	aggregate	of 270,097,373	shares	of	Kraft	Heinz	common	stock.	As	a	result	of	the	relationships	described	above	under	"Independence	and	Related	Person	Transactions"	in	Item	13,	Certain	Relationships	and Related	Transactions,	and	Director	Independence,	Berkshire	Hathaway,	Mr.	Buffett	and	the	3G	Funds	may	be	deemed	to	be	a	group	for	purposes	of	Section	13(d)	of	the	Exchange	Act	and therefore	may	be	deemed	to	hold	595,539,525	shares	of	Kraft	Heinz	common	stock.

(3) Based	on	the	Schedule	13G/A	filed	on	February	15,	2017	by	Warren	E.	Buffett	and	Berkshire	Hathaway.	As	a	result	of	the	relationships	described	above	under	"Independence	and	Related	Person Transactions"	in	Item	13,	Certain	Relationships	and	Related	Transactions,	and	Director	Independence ,	Berkshire	Hathaway,	Mr.	Buffett	and	the	3G	Funds	may	be	deemed	to	be	a	group	for purposes	of	Section	13(d)	of	the	Exchange	Act	and	therefore	may	be	deemed	to	hold	616,169,839	shares	of	Kraft	Heinz	common	stock.

# Item	13.	Certain	Relationships	and	Related	Transactions,	and	Director	Independence.

# INDEPENDENCE	AND	RELATED	PERSON	TRANSACTIONS

# Independence	Determinations

The	Guidelines	require	that	a	majority	of	the	directors	meet	Nasdaq	listing	standards'	"independence"	requirements.	For	a	director	to	be	considered	independent,	the Board	must	affirmatively	determine,	after	reviewing	all	relevant	information,	that	a	director	has	no	direct	or	indirect	material	relationship	with	Kraft	Heinz	that	would interfere	with	his	or	her	exercise	of	independent	judgment	in	carrying	out	his	or	her	responsibilities	as	a	director.	The	Board	determined	that,	under	the	Nasdaq	listing standards,	the	following	director	nominees	are	independent:	Mr.	Abel,	Mr.	Behring,	Ms.	Cool,	Mr.	Dewan,	Ms.	Jackson,	Mr.	Lemann,	Mr.	Pope,	Mr.	Castro-Neves,	and Mr.	Van	Damme.	Warren	Buffett	and	Mackey	McDonald,	who	retired	from	Board	service	in	2018,	and	Marcel	Herrmann	Telles,	who	decided	to	retire	from	the	Board, effective	on	June	12,	2019,	were	also	determined	to	be	independent	during	the	periods	they	served.	Mr.	Cahill,	the	former	Chief	Executive	Officer	of	Kraft	and	a	current consultant	to	Kraft	Heinz,	and	George	Zoghbi,	our	former	Chief	Operating	Officer	of	the	U.S.	Commercial	business	and	Special	Advisor	at	Kraft	Heinz,	are	not independent.

In	 conducting	 its	 evaluations	 of	 Mr.	Abel,	 Mr.	 Buffett,	 and	 Ms.	 Cool,	 the	 Board	 considered	 each	 individual's	 affiliation	 with	 Berkshire	 Hathaway,	 which	 held approximately	27%	of	our	outstanding	common	stock	as	of	June	5,	2019,	and	its	subsidiaries.	Similarly,	in	conducting	its	evaluations	of	Mr.	Behring,	Mr.	Lemann,	Mr. Castro-Neves,	and	Mr.	Telles,	the	Board	considered	each	individual's	affiliation	with	3G	Capital,	which	held	approximately	 22%	of	our	outstanding	common	stock	as	of June	5,	2019,	and	its	subsidiaries.	The	Board	also	considered	the	service	of	Messrs.	Behring,	Castro-Neves,	and	Van	Damme	on	the	Board	of	Directors	of	RBI,	a company	in	which	3G	Capital	invests	and	the	parent	company	of	Burger	King	and	Tim	Hortons,	quick	service	restaurant	companies	that	purchase	certain	of	our	products and	conduct	certain	brand	sponsorship	and	marketing	activities	for	us,	in	conducting	its	evaluations	of	them.

# Review	of	Transactions	with	Related	Persons

The	Board	has	adopted	a	written	policy	regarding	the	review,	approval,	or	ratification	of	"related	person	transactions."	A	"related	person	transaction"	is	one	in	which Kraft	Heinz	is	a	participant,	the	amount	involved	exceeds	$120,000,	and	any	"related	person"	had,	has,	or	will	have	a	direct	or	indirect	material	interest.	In	general, "related	persons"	include	our	directors,	executive	officers,	and	5%	stockholders	and	their	immediate	family	members.	In	accordance	with	this	policy,	the	Governance Committee	reviews	transactions	that	might	qualify	as	"related	person	transactions."	If	the	Governance	Committee	determines	that	a	transaction	qualifies	as	a	"related person	 transaction,"	 then	 the	Governance	Committee	reviews,	and	approves,	disapproves,	or	ratifies	 the	"related	person	 transaction."	The	Governance	Committee approves	or	ratifies	only	those	"related	person	transactions"	that	are	fair	and	reasonable	to	Kraft	Heinz	and	in	our	and	our	stockholders'	best	interests.	Any	member	of	the Governance	 Committee	 who	 is	 a	 "related	 person"	 with	 respect	 to	 a	 transaction	 under	 review	 may	 not	 participate	 in	 the	 deliberations	 or	 decisions	 regarding	 the transaction.	The	chair	of	the	Governance	Committee	(or	the	Chair	of	the	Audit	Committee	if	the	chair	of	the	Governance	Committee	is	a	"related	person"	with	respect	to the	transaction	under	review)	will	review	and	approve	or	ratify	potential	"related	person	transactions"	when	it	is	not	practicable	or	desirable	to	delay	review	of	a transaction	until	a	Governance	Committee	meeting,	and	will	report	to	the	Governance	Committee	any	transaction	so	approved	or	ratified.	The	Governance	Committee,	in the	course	of	its	review	and	approval	or	ratification	of	a	related	person	transaction	under	this	policy,	considers,	among	other	things:

•the commercial reasonableness of the transaction;

•the	 materiality of the related person's direct or indirect interest in the transaction;

•whether the transaction	 may involve	 an	 actual,	 or the	 appearance	 of	 a,	 conflict	 of interest;

•the	impact	of	the	transaction	on	the	related	person's	independence	(as	defined	in	the	Guidelines	and	the	Nasdaq	listing	standards); and

•whether the transaction	 would	 violate	 any	 provision	 of	 our	 Directors	 Ethics	 Code	 or	 Code	 of Conduct.

# Registration	Rights	Agreement

In	connection	with	the	2015	Merger,	we	entered	into	a	registration	rights	agreement	with	3G	Global	Food	Holdings	and	Berkshire	Hathaway.	Pursuant	to	the	registration rights	agreement,	we	granted	3G	Global	Food	Holdings	and	Berkshire	Hathaway	registration	rights	with	respect	to	the	shares	of	Kraft	Heinz	common	stock	held	by	3G Global	Food	Holdings	and	Berkshire	Hathaway	as	of	the	date	of	the	closing	of	the	2015	Merger,	representing	shares	of	Kraft	Heinz	common	stock	acquired	from	Heinz in	connection	with	the	2015	Merger	and/or	immediately	prior	to	the	2015	Merger	pursuant	to	a	warrant.	The	registration	rights	only	apply	to	registrable	shares	and	not shares	of	Kraft	Heinz	common	stock	subsequently	acquired	by	either	party.	These	rights	include	demand	registration	rights,	shelf	registration	rights,	and	"piggyback" registration	rights,	as	well	as	customary	indemnification.	The	rights	are	subject	to	certain	holdback	and	suspension	periods.	We	generally	will	bear	all	fees,	costs,	and expenses	related	to	registrations,	other	than	underwriting	discounts	and	commissions	attributable	to	the	sale	of	shares	of	Kraft	Heinz	common	stock	by	3G	Global	Food Holdings	and	Berkshire	Hathaway,	as	applicable.

# Demand	Registration	Rights

The	registration	rights	agreement	grants	each	of	3G	Global	Food	Holdings	and	Berkshire	Hathaway	demand	registration	rights.	We	will	be	required,	upon	the	written request	of	3G	Global	Food	Holdings	or	Berkshire	Hathaway,	to	file	a	registration	statement	pursuant	to	its	demand	rights	under	the	registration	rights	agreement,	as promptly	as	practicable	and	to	use	our	reasonable	best	efforts	to	effect	registration	of	shares	of	Kraft	Heinz	common	stock	requested	to	be	registered	by	3G	Global	Food Holdings	or	Berkshire	Hathaway,	subject	to	certain	exceptions.	Each	of	3G	Global	Food	Holdings	and	Berkshire	Hathaway	may	request	up	to	three	demand	registrations in	the	aggregate.

# Shelf	Registration	Rights

The	registration	rights	agreement	also	grants	each	of	3G	Global	Food	Holdings	and	Berkshire	Hathaway	shelf	registration	rights.	Subject	to	our	eligibility	to	use	a Registration	Statement	on	Form	S-3,	each	of	3G	Global	Food	Holdings	and	Berkshire	Hathaway	may	request	that	we	file	a	shelf	registration	statement	with	respect	to some	or	all	of	its	shares	of	Kraft	Heinz	common	stock,	and,	upon	such	request,	we	are	required	to	file	such	registration	statement	promptly	as	practicable,	subject	to certain	exceptions.

# "Piggyback"	Registration	Rights

The	registration	rights	agreement	grants	each	of	3G	Global	Food	Holdings	and	Berkshire	Hathaway	"piggyback"	registration	rights.	If	we	register	any	of	our	shares	of common	stock,	either	for	our	own	account	or	for	the	account	of	other	stockholders,	each	of	3G	Global	Food	Holdings	and	Berkshire	Hathaway	will	be	entitled,	subject	to certain	exceptions,	to	include	its	shares	of	common	stock	in	the	registration.

# Holdback	Periods

Notwithstanding	the	registration	rights	described	above,	if	there	is	an	offering	of	shares	of	Kraft	Heinz	and	the	managing	underwriters	for	the	offering	advise	us	that	a public	sale	or	distribution	of	shares	outside	the	offering	would	adversely	affect	the	offering,	then,	if	requested,	each	of	3G	Global	Food	Holdings	and	Berkshire Hathaway	will	not	dispose	of,	or	request	the	registration	of,	any	registrable	shares	for	a	certain	period,	which	we	refer	to	as	a	holdback	period.	The	holdback	period	will begin	on	the	10th	day	before	the	pricing	date	of	the	offering	and	extend	for	either	(i)	120	days	or	(ii)	an	earlier	date,	if	designated	by	the	managing	underwriters.

# Suspension	Periods

In	addition,	we	may	delay	or	suspend	the	filing,	effectiveness,	or	use	of	a	registration	statement	for	a	certain	period,	which	we	refer	to	as	a	suspension	period,	if	we determine	that	(i)	proceeding	with	the	use	or	effectiveness	of	the	registration	statement	would	require	us	to	disclose	material	non-public	information	and	the	disclosure	of that	information	at	that	time	would	not	be	in	our	best	interests	or	(ii)	the	registration	or	offering	to	be	delayed	or	suspended	would,	if	not	delayed	or	suspended, materially	adversely	affect	us	or	delay	or	otherwise	materially	adversely	affect	the	success	of	any	pending	or	proposed	material	transaction,	including	any	debt	or	equity financing,	any	acquisition	or	disposition,	any	recapitalization	or	reorganization	or	any	other	material	transaction,	whether	due	to	commercial	reasons,	a	desire	to	avoid premature	disclosure	of	information,	or	any	other	reason.	During	any	calendar	year,	there	will	not	be	more	than	two	suspension	periods	and	the	aggregate	number	of	days included	in	all	suspension	periods	in	that	year	will	not	exceed	119	days.

# Shareholders'	Agreement

In	connection	with	the	2015	Merger,	3G	Global	Food	Holdings	and	Berkshire	Hathaway	entered	into	a	shareholders'	agreement	that	governs	how	each	party	and	their affiliates	will	vote	the	shares	of	Kraft	Heinz	common	stock	held	by	them	as	of	the	date	of	closing	of	the	2015	Merger,	with	respect	to	supporting	certain	directors	who are	designated	by	either	3G	Global	Food	Holdings	or	Berkshire	Hathaway.	Pursuant	to	the	shareholders'	agreement,	3G	Global	Food	Holdings	agrees	that	for	so	long	as Berkshire	Hathaway	and	its	affiliates	control	shares	representing	at	least	66%	of	the	voting	power	in	election	of	directors	of	shares	owned	by	Berkshire	Hathaway	as	of the	consummation	of	the	2015	Merger,	3G	Global	Food	Holdings	and	its	affiliates	will	vote	their	shares	of	Kraft	Heinz	common	stock	in	favor	of	the	three	Kraft	Heinz Board	nominees	designated	by	Berkshire	Hathaway	and	not	take	any	action	to	remove	such	designees	without	Berkshire	Hathaway's	consent.	Similarly,	Berkshire Hathaway	agrees	that	for	so	long	as	3G	Global	Food	Holdings	and	its	affiliates	control	shares	representing	at	least	66%	of	the	voting	power	in	elections	of	directors	of shares	owned	by	3G	Global	Food	Holdings	as	of	the	consummation	of	the	2015	Merger,	Berkshire	Hathaway	and	its	affiliates	will	vote	their	shares	of	Kraft	Heinz common	stock	in	favor	of	the	three	Kraft	Heinz	Board	nominees	designated	by	3G	Global	Food	Holdings	and	not	take	any	action	to	remove	such	designees	without	3G Global	Food	Holdings'	consent.	The	shareholders'	agreement	provides	that	each	party's	foregoing	rights	and	obligations	will	step	down	upon	specified	reductions	in ownership	below	the	66%	threshold	described	above	by	either	3G	Global	Food	Holdings	or	Berkshire	Hathaway	and	their	respective	affiliates,	as	applicable.

# Consulting	Agreement

On	November	2,	2017,	we	entered	into	a	consulting	agreement	with	Mr.	Cahill	pursuant	to	which	he	provides	advisory	and	consulting	services	to	us	related	to	current	and historical	finances,	relationships	with	licensors,	customers	and	vendors,	employee	matters,	product	development,	marketing	and	distribution,	government	affairs	and strategic	opportunities.	Mr.	Cahill	is	paid	$500,000	annually	under	this	new	consulting	agreement,	which	was	approved	by	the	disinterested	members	of	the	Board. Mr.	Cahill's	services	under	the	consulting	agreement	are	distinct	from	his	duties	as	a	director.	Previously,	Mr.	Cahill	had	provided	similar	services	under	a	consulting agreement	entered	into	following	the	2015	Merger,	which	had	expired	in	July	2017.

# Compensation	Arrangement

Effective	January	1,	2017,	the	Company	entered	into	an	offer	letter	(the	"Offer	Letter")	with	Mr.	Zoghbi	in	order	to	incent	Mr.	Zoghbi	to	extend	his	service	with	the Company	past	January	1,	2017,	after	a	retention	bonus	pursuant	to	a	prior	offer	letter	entered	into	upon	the	closing	of	the	2015	Merger	had	been	earned.	Under	the	Offer Letter,	Mr.	Zoghbi:	(i)	continued	his	current	base	salary	of	$850,000;	(ii)	agreed	to	a	2017	target	annual	incentive	award	opportunity	of	200%	(with	a	maximum	bonus multiplier	of	130%);	and	(iii)	was	granted	a	long-term	equity	incentive	award.	The	long-term	equity	incentive	award	was	composed	of	(i)	RSUs,	which	cliff	vest	after three	years,	and	(ii)	PSUs,	which	cliff	vest	after	three	years	based	on	the	achievement	of	U.S.	sales	growth	targets	and	U.S.	Adjusted	EBITDA	growth	targets.	The	Offer Letter	also	eliminated	the	Section	280G	gross-up	rights	that	Mr.	Zoghbi	had	been	granted	by	Kraft	compensation	plans	prior	to	the	2015	Merger.	In	October	2017,	Mr. Zoghbi	transitioned	from	his	role	as	President	of	the	U.S.	Commercial	business	to	his	role	as	Special	Advisor.	As	previously	disclosed,	Mr.	Zoghbi	was	not	eligible	under the	Offer	Letter	for	an	annual	incentive	award	in	2018	based	on	2017	performance.	For	as	long	as	Mr.	Zoghbi	continues	to	serve	as	a	Special	Advisor	at	Kraft	Heinz,	it	is anticipated	that	he	will	not	receive	compensation	for	his	services	as	a	director.

# Item	14.	Principal	Accounting	Fees	and	Services.

# Independent	Auditors'	Fees

Aggregate	fees	for	professional	services	rendered	by	our	independent	auditors,	PricewaterhouseCoopers	LLP,	are	set	forth	in	the	table	below	(in	thousands).	All	fees below	include	out-of-pocket	expenses.

|  | December	29,	2018 | December	30,	2017 |
| :--- | :--- | :--- |
| Audit\tFees(1) | $19,234 | $9,353 |
| Audit-Related\tFees(2) | 442 | 401 |
| Tax\tFees(3) | 1,171 | 1,009 |
| All\tOther\tFees(4) | 46 | 5 |
| Total | $20,893 | $10,768 |

(1) Include	(a)	the	audit	of	our	consolidated	financial	statements,	including	statutory	audits	of	the	financial	statements	of	certain	of	our	affiliates,	and	(b)	the	reviews	of	our	unaudited	condensed consolidated	interim	financial	statements	(quarterly	financial	statements).	The	increase	from	2017	to	2018	primarily	related	to	audit	overruns	associated	with	the	procurement	investigation, restatement,	and	impairment	of	goodwill	and	intangible	assets.

(2) Include	professional	services	in	connection	with	accounting	consultations	and	procedures	related	to	various	other	audit	and	special	reports.

(3) Include	professional	services	in	connection	with	tax	compliance	and	advice.

(4) Consist	principally	of	software	license	fees	related	to	research	and	benchmarking.

# Pre-Approval	Policy

The	Audit	Committee's	policy	is	to	pre-approve	all	audit	and	non-audit	services	provided	by	the	independent	auditors.	These	services	may	include	audit	services,	audit- related	services,	tax	services,	and	other	permissible	non-audit	services.	The	pre-approval	authority	details	the	particular	service	or	category	of	service	that	the	independent auditors	will	perform.	The	Audit	Committee's	policy	also	requires	management	to	report	at	Audit	Committee	meetings	throughout	the	year	on	the	actual	fees	charged	by the	independent	auditors	for	each	category	of	service.	The	Audit	Committee	reviews	this	policy	annually.

During	the	year,	circumstances	may	arise	when	it	may	be	necessary	to	engage	the	independent	auditors	for	additional	services	not	contemplated	in	the	original	pre- approval	authority.	In	those	instances,	the	Audit	Committee	approves	the	services	before	we	engage	the	independent	auditors.	If	pre-approval	is	needed	before	a scheduled	Audit	Committee	meeting,	the	Audit	Committee	delegated	pre-approval	authority	to	its	chair.	The	chair	must	report	on	such	pre-approval	decisions	at	the committee's	next	regular	meeting.

During	fiscal	year	2018,	the	Audit	Committee	pre-approved	all	audit	and	non-audit	services	provided	by	the	independent	auditors.

# PART	IV

# Item	15.	Exhibits,	Financial	Statement	Schedules.

# (a)	Index	to	Consolidated	Financial	Statements	and	Schedules

Schedules	other	than	those	listed	above	have	been	omitted	either	because	such	schedules	are	not	required	or	are	not	applicable.

(b)	The	following	exhibits	are	filed	as	part	of,	or	incorporated	by	reference	into,	this	Annual	Report:

Master	Ownership	and	License	Agreement	Regarding	Patents,	Trade	Secrets	and	Related	Intellectual	Property	between	Kraft	Foods	Global	Brands LLC,	Kraft	Foods	Group	Brands	LLC,	Kraft	Foods	UK	Ltd.	and	Kraft	Foods	R&D	Inc.,	dated	as	of	October	1,	2012	(incorporated	by	reference	to Exhibit	2.3	to	Amendment	No.	2	to	Kraft	Foods	Group,	Inc.'s	Registration	Statement	on	Form	S-4	(File	No.	333-184314),	filed	on	December	4, 2012).+

Master	Ownership	and	License	Agreement	Regarding	Trademarks	and	Related	Intellectual	Property	between	Kraft	Foods	Global	Brands	LLC	and Kraft	Foods	Group	Brands	LLC.,	dated	as	of	September	27,	2012	(incorporated	by	reference	to	Exhibit	2.4	to	Amendment	No.	2	to	Kraft	Foods	Group, Inc.'s	Registration	Statement	on	Form	S-4	(File	No.	333-184314),	filed	on	December	4,	2012).+

Second	Supplemental	Indenture	dated	as	of	July	6,	2015,	governing	the	Floating	Rate	Senior	Notes	due	2020,	by	and	among	Kraft	Canada	Inc.,	as issuer,	The	Kraft	Heinz	Company	and	Kraft	Heinz	Foods	Company,	as	guarantors,	and	Computershare	Trust	Company	of	Canada,	as	trustee (incorporated	by	reference	to	Exhibit	4.12	of	the	Company's	Current	Report	on	Form	8-K	(File	No.	1-37482),	filed	on	July	6,	2015).

Third	Supplemental	Indenture	dated	as	of	July	6,	2015,	governing	the	2.70%	Senior	Notes	due	2020,	by	and	among	Kraft	Canada	Inc.,	as	issuer,	The Kraft	Heinz	Company	and	Kraft	Heinz	Foods	Company,	as	guarantors,	and	Computershare	Trust	Company	of	Canada,	as	trustee	(incorporated	by reference	to	Exhibit	4.14	of	the	Company's	Current	Report	on	Form	8-K	(File	No.	1-37482),	filed	on	July	6,	2015).

Indenture	by	and	between	H.	J.	Heinz	Company	(as	successor	issuer),	and	The	Bank	of	New	York	Mellon	(as	successor	trustee)	dated	as	of	July	15, 1992	(incorporated	by	reference	to	Exhibit	4(a)	to	H.	J.	Heinz	Company's	Registration	Statement	on	Form	S-3	(File	No.	333-48017),	filed	on	March 16,	1998).

Fourth	Supplemental	Indenture,	dated	as	of	May	24,	2016,	governing	the	3.000%	Senior	Notes	due	2026	and	the	4.375%	Senior	Notes	due	2046,	by and	among	Kraft	Heinz	Foods	Company,	as	issuer,	The	Kraft	Heinz	Company,	as	guarantor,	and	Deutsche	Bank	Trust	Company	Americas,	as	trustee (incorporated	by	reference	to	Exhibit	4.1	of	the	Company's	Current	Report	on	Form	8-K	(File	No.	1-37482),	filed	on	May	25,	2016).

Credit	Agreement	dated	as	of	July	6,	2015,	by	and	among	Kraft	Heinz	Foods	Company	(formerly	known	as	H.	J.	Heinz	Company),	The	Kraft	Heinz Company	(formerly	known	as	H.J.	Heinz	Holding	Corporation),	the	lenders	party	thereto,	JPMorgan	Chase	Bank,	N.A.,	as	Administrative	Agent	and JPMorgan	Europe	Limited,	as	London	Agent	(incorporated	by	reference	to	Exhibit	10.1	of	the	Company's	Current	Report	on	Form	8-K	(File	No.	1- 37482),	filed	on	July	6,	2015).

Waiver	and	Consent	No.	1	to	Credit	Agreement,	dated	as	of	March	22,	2019,	to	the	Credit	Agreement	dated	as	of	July	6,	2015,	by	and	among	The	Kraft Heinz	Company,	Kraft	Heinz	Foods	Company,	the	Lenders	party	thereto,	JPMorgan	Chase	Bank,	N.A.,	as	Administrative	Agent,	and	J.P.	Morgan Europe	Limited,	as	London	agent	for	the	Lenders	(incorporated	by	reference	to	Exhibit	10.1	to	the	Company's	Current	Report	on	Form	8-K	(File	No.	1- 37482),	filed	on	March	22,	2019.

10.23 Waiver	and	Consent	No.	2	to	Credit	Agreement,	dated	as	of	May	10,	2019,	to	the	Credit	Agreement	dated	as	of	July	6,	2015,	by	and	among	The	Kraft Heinz	Company,	Kraft	Heinz	Foods	Company,	the	Lenders	party	thereto,	JPMorgan	Chase	Bank,	N.A.,	as	Administrative	Agent,	and	J.P.	Morgan Europe	Limited,	as	London	agent	for	the	Lenders	(incorporated	by	reference	to	Exhibit	10.1	to	the	Company's	Current	Report	on	Form	8-K	(File	No.	1- 37482),	filed	on	May	10,	2019.

The	following	materials	from	The	Kraft	Heinz	Company's	Annual	Report	on	Form	10-K	for	the	period	ended	December	29,	2018	formatted	in	XBRL (eXtensible	Business	Reporting	Language):	(i)	the	Consolidated	Statements	of	Income,	(ii)	the	Consolidated	Statements	of	Comprehensive	Income,	(iii) the	Consolidated	Statements	of	Equity,	(iv)	the	Consolidated	Balance	Sheets,	(v)	the	Consolidated	Statements	of	Cash	Flows,	(vi)	Notes	to Consolidated	Financial	Statements,	and	(vii)	document	and	entity	information.

The	Company	agrees	to	furnish	supplementally	a	copy	of	any	omitted	attachment	to	the	SEC	on	a	confidential	basis	upon	request.

Indicates	a	management	contract	or	compensatory	plan	or	arrangement.

# SIGNATURES

Pursuant	to	the	requirements	of	Section	13	or	15(d)	of	the	Securities	Exchange	Act	of	1934,	the	registrant	has	duly	caused	this	report	to	be	signed	on	its	behalf	by	the undersigned,	thereunto	duly	authorized.

David	H.	Knopf

Executive	Vice	President	and	Chief	Financial	Officer

(Principal	Financial	Officer)

Pursuant	to	the	requirements	of	the	Securities	Exchange	Act	of	1934,	this	report	has	been	signed	below	by	the	following	persons	on	behalf	of	the	registrant	and	in	the capacities	and	on	the	date	indicated:

George	Zoghbi*

	 Director

Attorney-In-Fact

# Valuation	and	Qualifying	Accounts

|  |  | Additions |  | Deductions |  |
| :--- | :--- | :--- | :--- | :--- | :--- |
| Description | Balance\tat\tBeginning\nof\tPeriod | Charged\tto\tCosts\tand\nExpenses | Charged\tto\tOther\nAccounts(a) | Write-offs\tand\nReclassifications | Balance\tat\tEnd\tof\nPeriod |
| Year\tended\tDecember\t29,\t2018 |  |  |  |  |  |
| Allowances\trelated\tto\ttrade\taccounts\nreceivable | $23 | $8 | $— | $(7) | $24 |
| Allowances\trelated\tto\tdeferred\ttaxes | 80 | 1 | — | — | 81 |
|  | $103 | $9 | $— | $(7) | $105 |
| Year\tended\tDecember\t30,\t2017 |  |  |  |  |  |
| Allowances\trelated\tto\ttrade\taccounts\nreceivable | $20 | $8 | $1 | $(6) | $23 |
| Allowances\trelated\tto\tdeferred\ttaxes | 89 | (9) | — | — | 80 |
|  | $109 | $(1) | $1 | $(6) | $103 |
| Year\tended\tDecember\t31,\t2016 |  |  |  |  |  |
| Allowances\trelated\tto\ttrade\taccounts\nreceivable | $32 | $6 | $(4) | $(14) | $20 |
| Allowances\trelated\tto\tdeferred\ttaxes | 83 | 6 | — | — | 89 |
|  | $115 | $12 | $(4) | $(14) | $109 |

(a)		Primarily	relates	to	acquisitions	and	currency	translation.


what is the net increase in outstanding shares during the period of 2016 to 2018 , in millions?
  shares_issued = 1220
 shares_outstanding = 1220 - 1214
 answer = shares_outstanding