Broadening Your Perspective 11-2 The financial statements of The


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Broadening Your Perspective 11-2 The financial statements of The Hershey Company and Tootsie Roll are presented below. THE HERSHEY COMPANY CONSOLIDATED STATEMENTS OF INCOME For the years ended December 31,201120102009 In thousands of dollars except per share amounts Net Sales$6,080,788$5,671,009$5,298,668 Costs and Expenses: Cost of sales3,548,8963,255,8013,245,531 Selling, marketing and administrative1,477,7501,426,4771,208,672 Business realignment and impairment (credits) charges, net(886)83,43382,875 Total costs and expenses5,025,7604,765,7114,537,078 Income before Interest and Income Taxes1,055,028905,298761,590 Interest expense, net92,18396,43490,459 Income before Income Taxes962,845808,864671,131 Provision for income taxes333,883299,065235,137 Net Income$628,962$509,799$435,994 Net Income Per Share—Basic—Class B Common Stock$2.58$2.08$1.77 Net Income Per Share—Diluted—Class B Common Stock$2.56$2.07$1.77 Net Income Per Share—Basic—Common Stock$2.85$2.29$1.97 Net Income Per Share—Diluted—Common Stock$2.74$2.21$1.90 Cash Dividends Paid Per Share: Common Stock$1.3800$1.2800$1.1900 Class B Common Stock1.25001.16001.0712 The notes to consolidated financial statements are an integral part of these statements and are included in the Hershey’s 2011 Annual Report, available at www.thehersheycompany.com. THE HERSHEY COMPANY CONSOLIDATED BALANCE SHEETS December 31,20112010 In thousands of dollars ASSETS Current Assets: Cash and cash equivalents$693,686$884,642 Accounts receivable—trade399,499390,061 Inventories648,953533,622 Deferred income taxes136,86155,760 Prepaid expenses and other167,559141,132 Total current assets2,046,5582,005,217 Property, Plant and Equipment, Net1,559,7171,437,702 Goodwill516,745524,134 Other Intangibles111,913123,080 Deferred Income Taxes38,54421,387 Other Assets138,722161,212 Total assets$4,412,199$4,272,732 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities: Accounts payable$420,017$410,655 Accrued liabilities612,186593,308 Accrued income taxes1,8999,402 Short-term debt42,08024,088 Current portion of long-term debt97,593261,392 Total current liabilities1,173,7751,298,845 Long-term Debt1,748,5001,541,825 Other Long-term Liabilities617,276494,461 Total liabilities3,539,5513,335,131 Commitments and Contingencies— — Stockholders’ Equity: The Hershey Company Stockholders’ Equity Preferred Stock, shares issued: none in 2011 and 2010—— Common Stock, shares issued: 299,269,702 in 2011 and 299,195,325 in 2010299,269299,195 Class B Common Stock, shares issued: 60,632,042 in 2011 and 60,706,419 in 201060,63260,706 Additional paid-in capital490,817434,865 Retained earnings4,699,5974,374,718 Treasury—Common Stock shares, at cost: 134,695,826 in 2011 and 132,871,512 in 2010(4,258,962)(4,052,101) Accumulated other comprehensive loss(442,331)(215,067) The Hershey Company stockholders’ equity849,022902,316 Noncontrolling interests in subsidiaries23,62635,285 Total stockholders’ equity872,648937,601 Total liabilities and stockholders’equity$4,412,199$4,272,732 THE HERSHEY COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS For the years ended December 31,201120102009 In thousands of dollars Cash Flows Provided from (Used by) Operating Activities Net income $628,962$509,799$435,994 Adjustments to reconcile net income to net cash provided from operations: Depreciation and amortization215,763197,116182,411 Stock-based compensation expense, net of tax of $15,127, $17,413 and $19,223, respectively28,34132,05534,927 Excess tax benefits from stock-based compensation(13,997)(1,385)(4,455) Deferred income taxes33,611(18,654)(40,578) Gain on sale of trademark licensing rights, net of tax of $5,962(11,072)— — Business realignment and impairment charges, net of tax of $18,333, $20,635 and $38,308, respectively30,83877,93560,823 Contributions to pension plans(8,861)(6,073)(54,457) Changes in assets and liabilities, net of effects from business acquisitions and divestitures: Accounts receivable—trade(9,438)20,32946,584 Inventories(115,

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