Wrigley Reports 30% Earnings Per Share Increase on Record First Quarter Sales

Company Posts 7th Consecutive Quarter of Double-Digit Sales Gains

    CHICAGO, April 30 /PRNewswire-FirstCall/ -- The Wm. Wrigley Jr. Company
 ( WWY) today announced record first quarter sales of $1.26 billion, up
 17 percent from the same quarter in 2006. The increase in sales was driven
 primarily by worldwide shipment growth of 12 percent.
     Net earnings for the quarter of $0.52 per diluted share were up 30% or
 $0.12 from the year ago period. On a non-GAAP basis, excluding the negative
 impact of the supply chain restructuring program announced in 2005 and a
 one- time gain from the sale of a corporate asset, first quarter earnings
 per share were $0.50, up 19 percent from the same quarter last year.*
     "Our results this quarter reflect solid execution in the marketplace,
 including the launch of several new products and strong support of our
 brands around the world," said President and Chief Executive Officer Bill
 Perez. "We anticipate maintaining our positive momentum through focused
 investment in our key geographies and upcoming product launches, such as
 the gum brand '5' in the U.S. marketplace."
     Bill Wrigley, Executive Chairman and Chairman of the Board added, "We
 are pleased with our strong start to the new year -- including growing
 contributions from our acquired confectionery brands, driven by higher
 sales and improved margins. Our continued business growth and strong
 financial results are particularly impressive because they were
 accomplished in the face of increased global competition."
     Sales and Gross Margins
     First quarter sales increased by $181 million, or 17 percent, over the
 same quarter last year. Approximately two-thirds of the sales gain was
 driven by shipment growth across all regions, particularly Asia and EMEAI.
 The positive impact of currency, due to translation of international sales
 into a relatively weaker U.S. dollar, accounted for the balance of the
 growth.
     In EMEAI (principally Europe), sales were $565 million, up 27 percent
 versus a year ago on volume growth of 14%. Of the remaining sales growth,
 about two-thirds is attributable to currency translation and one-third to
 positive price/mix in the quarter. In Western Europe, double-digit sales
 gains were recorded in the United Kingdom, with the launches of Orbit(R)
 Complete and liquid-filled Extra Ice(R) gum, and Germany, with the
 introduction of bottle packaging. Outside the EU, Russia and Ukraine lead
 the growth highlighted by significant sales gains for Orbit in both gum and
 sugarfree drops.
     North America net sales were $414 million, up three percent on volume
 gains of four percent. Orbit, Orbit White, and Eclipse(R) recorded double-
 digit gains, and Wrigley's sugar stick brands were up modestly versus year
 ago, while Extra gum had lower sales in the quarter, with difficult
 comparisons versus a new product launch in the year-ago period. Strong
 performance by the newly-launched Dark Chocolate Dipped Altoids(R) mints
 was offset by softer sales for Altoids Sours. The LifeSavers(R) brand
 recorded double-digit sales growth in the quarter as a result of increased
 shipments -- primarily due to the strength of mint and gummy products.
     Sales increased nearly $41 million or 23 percent in Asia to $217
 million on volume growth of 21 percent. In China, Wrigley continues to be
 the #1 confectioner, with growth in excess of 20% in the quarter, led by
 strong sales increases for Extra, Doublemint(R) and Sugus(R).
     Consolidated gross margins for the first quarter were 51.8 percent
 versus 51.9 percent the same quarter last year. Excluding the impact from
 restructuring, gross margins would have been 52.5 percent this quarter
 versus 52.7 percent a year ago, with slight cost increases offset by
 positive mix.
     "Given today's more challenging cost and competitive environment, we
 are satisfied with the improvements in gross margin versus the previous
 quarter and with our ability to essentially hold steady versus a year ago,"
 said Senior Vice President and Chief Financial Officer Reuben Gamoran. "As
 noted at our Annual Meeting, our now concluding supply chain restructuring
 program will yield approximately $20 million in savings during 2007 that
 will help us manage against any additional margin pressures as the year
 progresses."
     Operating Profits and Net Earnings
     Consolidated operating profits in the period were $210 million, up 22
 percent from the same quarter in the prior year. The increase was primarily
 driven by higher shipment volume, offset by increased investment in selling
 infrastructure and brand support. Favorable translation of foreign
 currencies to the weaker U.S. dollar accounted for about a third of the
 gain.
     Consolidated net earnings of $143 million were up nearly 28 percent or
 $31 million from the first quarter of 2006. On a diluted per share basis,
 earnings were $0.52, up 30 percent versus the prior year. On a non-GAAP
 basis, excluding the impact of restructuring and the one-time asset sale
 gain, earnings per share increased 19 percent versus the year-ago quarter.
     Balance Sheet
     As previously announced, in January of 2007, the Wrigley Company
 acquired an 80% interest in A. Korkunov, a leading player in the Russian
 premium boxed- chocolate segment, for $300 million. Increases in short-term
 debt as well as goodwill and intangibles during the quarter reflect the
 impact of this transaction.
     * Please see Attachment B for full GAAP to non-GAAP reconciliation.
     About Wrigley
     The Wm. Wrigley Jr. Company is a recognized leader in confections with
 a wide range of product offerings including gum, mints, hard and chewy
 candies, lollipops, and chocolate. The Company reported global sales of
 nearly $4.7 billion last year and distributes its world-famous brands in
 more than 180 countries. Three of these brands -- Wrigley's Spearmint(R),
 Juicy Fruit, and Altoids -- have heritages stretching back more than a
 century. Other well- loved brands include Doublemint, Life Savers(R), Big
 Red(R), Boomer(R), Pim Pom(R), Winterfresh, Extra, Freedent(R), Hubba
 Bubba(R), Orbit, Excel, Creme Savers, Eclipse, Airwaves(R), Solano(R),
 Sugus(R), P.K.(R), and Cool Air(R).
     Cautionary Statement Regarding Forward-Looking Information
     This press release contains statements which may be considered forward-
 looking statements within the meaning of the Securities Exchange Act of
 1934 and the Securities Act of 1933, including, without limitation,
 statements regarding operating strategies, future plans and financial
 results. Forward- looking statements may be accompanied by words such as
 "anticipate", "believe", "could", "estimate", "expect", "forecast",
 "intend", "may", "possible", "predict", "project", or similar words,
 phrases or expressions. The Company does not undertake any obligation to
 update the information contained herein, which speaks only as of the date
 of this press release. A variety of factors could cause actual results to
 differ materially from the anticipated results or expectations expressed
 including, without limitation, the availability or retention of retail
 space; the availability of raw materials; changes in demographics and
 consumer preferences; changes in foreign currency and market conditions;
 increased competition and discounting and other competitive actions;
 underutilization of or inadequate manufacturing capacity and labor
 stoppages; governmental regulations; labor stoppages; and the outcome of
 integrating acquired businesses. These factors, and other important factors
 that could affect these outcomes are set forth in the Company's most
 recently filed Annual Report on Form 10-K and the Company's other filings
 with the SEC, in each case under the heading "Forward-Looking Statements"
 and/or "Risk Factors". Such discussions regarding risk factors and
 forward-looking statements are incorporated herein by reference.
     ATTACHMENT A
 
                            WM. WRIGLEY JR. COMPANY
                       STATEMENT OF CONSOLIDATED EARNINGS
 
                                                       Three Months Ended
                                                             March 31,
                                                        2007          2006
 
     Net sales                                    $ 1,256,396    $ 1,075,530
 
     Cost of sales                                    597,406        508,351
 
     Restructuring charges                              8,149          8,570
 
       Gross profit                                   650,841        558,609
 
     Selling, general and
      administrative expense                          440,637        385,793
 
       Operating income                               210,204        172,816
 
     Interest expense                                 (16,602)       (15,343)
     Investment income                                  1,890          1,950
     Other income (expense), net                       16,703          5,113
 
     Earnings before income taxes                     212,195        164,536
 
     Income taxes                                      69,494         52,651
 
     Net earnings                                    $142,701       $111,885
 
     Net earnings per average share
      of common stock (basic)(a)                        $0.52          $0.40
 
     Net earnings per average share
      of common stock (diluted)(a)                      $0.52          $0.40
 
     Average number of basic shares
      outstanding for the period                      276,024        277,467
 
     Average number of diluted shares
      outstanding for the period                      277,037        278,818
 
     (a) Per share calculations based on the average number of shares
         outstanding for the period.
 
     Note:  In thousands except for earnings per share amounts.
 
 
 
     ATTACHMENT B
 
                            WM. WRIGLEY JR. COMPANY
                  RECONCILIATION OF GAAP TO NON-GAAP EARNINGS
 
                                       March 31, 2007        March 31, 2006
                                     000's    Per Share*    000's   Per Share*
 
     Earnings, as reported under
      U.S. GAAP                    $142,701     $0.52     $111,885     $0.40
 
     Restructuring expense, net
      of tax (A)                      5,480      0.02        5,828      0.02
 
     Gain on sale of corporate
      asset, net of tax (B)          (9,415)    (0.03)           -         -
 
 
     Non-GAAP earnings, excluding
      restructuring expense and
      gain on sale of corporate
      asset                        $138,766     $0.50     $117,713     $0.42
 
 
     * May not total due to rounding
 
     (A) Management has excluded restructuring expense as it is viewed as
         nonrecurring costs incurred to improve production operations.
 
     (B) Management has excluded the gain on the sale of a corporate asset, as
         it is viewed as nonrecurring income.
 
 
 
     ATTACHMENT C
 
                            WM. WRIGLEY JR. COMPANY
                   NET SALES AND OPERATING INCOME BY SEGMENT
 
                                                        Three Months Ended
                                                             March 31,
                                                        2007          2006
 
     Net Sales
 
       North America                                  413,987        400,573
 
       EMEAI                                          564,727        443,736
 
       Asia                                           217,049        176,164
 
       Other Geographic Regions                        47,017         39,887
 
       All Other                                       13,616         15,170
 
         Total Net Sales                            1,256,396      1,075,530
 
     Operating Income
 
       North America                                   76,114         70,256
 
       EMEAI                                          139,663        100,330
 
       Asia                                            65,083         56,789
 
       Other Geographic Regions                         6,110          3,433
 
       All Other                                      (76,766)       (57,992)
 
         Total Operating Income                       210,204        172,816
 
     Note:   All amounts in thousands.
 
 
 
     ATTACHMENT D
 
                            WM. WRIGLEY JR. COMPANY
                      CONDENSED CONSOLIDATED BALANCE SHEET
                           (All amounts in thousands)
 
                                                     March 31,    December 31,
                                                       2007          2006
     Assets
     Current assets:
       Cash and cash equivalents                     $204,480       $253,666
       Short-term investments, at amortized cost          350          1,100
       Accounts receivable, net                       508,298        463,231
       Inventories                                    603,883        592,985
       Other current assets                           199,515        170,245
         Total current assets                       1,516,526      1,481,227
 
     Deferred charges and other assets                213,304        194,382
     Goodwill                                       1,319,629      1,147,603
     Other intangibles                                500,247        415,870
     Net property, plant and equipment              1,451,365      1,422,516
     Total assets                                  $5,001,071     $4,661,598
 
     Liabilities and Stockholders' Equity
     Current liabilities:
       Commercial paper and short-term debt          $327,838        $65,000
       Accounts payable and accrued expenses          796,899        741,613
       Dividends payable                               80,150         71,106
       Income and other taxes payable                 167,351        149,410
         Total current liabilities                  1,372,238      1,027,129
 
     Other noncurrent liabilities                     262,929        246,377
     Long term debt                                 1,000,000      1,000,000
         Total liabilities                          2,635,167      2,273,506
 
     Stockholders' equity                           2,365,904      2,388,092
     Total liabilities and stockholders' equity    $5,001,071     $4,661,598
 
 

SOURCE Wm. Wrigley Jr. Company