Statement Of Income Alternative
Statement Of Income Alternative (USD $) | ||||
In Millions, except Per Share data | 3 Months Ended
Sep. 05, 2009 | 3 Months Ended
Sep. 06, 2008 | 9 Months Ended
Sep. 05, 2009 | 9 Months Ended
Sep. 06, 2008 |
Net Revenue | $11,080 | $11,244 | $29,935 | $30,522 |
Cost of sales | 5,181 | 5,268 | 13,806 | 14,180 |
Selling, general and administrative expenses | 3,649 | 3,972 | 10,077 | 10,560 |
Amortization of intangible assets | 18 | 13 | 42 | 43 |
Operating Profit | 2,232 | 1,991 | 6,010 | 5,739 |
Bottling equity income | 146 | 201 | 290 | 439 |
Interest expense | (86) | (73) | (285) | (205) |
Interest income | 16 | 14 | 44 | 53 |
Income before income taxes | 2,308 | 2,133 | 6,059 | 6,026 |
Provision for income taxes | 575 | 550 | 1,517 | 1,586 |
Net income | 1,733 | 1,583 | 4,542 | 4,440 |
Less: Net income attributable to noncontrolling interests | 16 | 7 | 30 | 17 |
Net Income Attributable to PepsiCo | $1,717 | $1,576 | $4,512 | $4,423 |
Net Income Attributable to PepsiCo per Common Share | ||||
Basic | 1.1 | 1.01 | 2.9 | 2.79 |
Diluted | 1.09 | 0.99 | 2.87 | 2.74 |
Cash Dividends Declared per Common Share | 0.45 | 0.425 | 1.325 | 1.225 |
Statement Of Cash Flows Indirec
Statement Of Cash Flows Indirect (USD $) | ||
In Millions | 9 Months Ended
Sep. 05, 2009 | 9 Months Ended
Sep. 06, 2008 |
Operating Activities | ||
Net income | $4,542 | $4,440 |
Depreciation and amortization | 1,083 | 1,055 |
Stock-based compensation expense | 159 | 169 |
Restructuring and impairment charges | 36 | 0 |
Cash payments for restructuring charges | (183) | (24) |
Excess tax benefits from share-based payment arrangements | (16) | (83) |
Pension and retiree medical plan contributions | (1,130) | (132) |
Pension and retiree medical plan expenses | 290 | 318 |
Bottling equity income, net of dividends | (222) | (372) |
Deferred income taxes and other tax charges and credits | 59 | 275 |
Change in accounts and notes receivable | (459) | (1,166) |
Change in inventories | (128) | (362) |
Change in prepaid expenses and other current assets | 17 | (49) |
Change in accounts payable and other current liabilities | (241) | 212 |
Change in income taxes payable | 914 | 566 |
Other, net | (318) | (189) |
Net Cash Provided by Operating Activities | 4,403 | 4,658 |
Investing Activities | ||
Capital spending | (1,138) | (1,399) |
Sales of property, plant and equipment | 33 | 85 |
Acquisitions and investments in noncontrolled affiliates | (300) | (1,707) |
Divestitures | 100 | 0 |
Cash restricted for pending acquisitions | 30 | (297) |
Cash proceeds from sale of The Pepsi Bottling Group, Inc. (PBG) and PepsiAmericas, Inc. (PAS) stock | 0 | 342 |
Short-term investments, by original maturity | ||
More than three months - purchases | (29) | (143) |
More than three months - maturities | 55 | 44 |
Three months or less, net | 4 | 1,299 |
Net Cash Used for Investing Activities | (1,245) | (1,776) |
Financing Activities | ||
Proceeds from issuances of long-term debt | 1,057 | 1,733 |
Payments of long-term debt | (188) | (488) |
Short-term borrowings, by original maturity | ||
More than three months - proceeds | 32 | 42 |
More than three months - payments | (64) | (120) |
Three months or less, net | (965) | 2,080 |
Cash dividends paid | (2,032) | (1,879) |
Share repurchases - common | 0 | (4,197) |
Share repurchases - preferred | (4) | (4) |
Proceeds from exercises of stock options | 187 | 495 |
Other financing | (26) | 0 |
Excess tax benefits from share-based payment arrangements | 16 | 83 |
Net Cash Used for Financing Activities | (1,987) | (2,255) |
Effect of Exchange Rate Changes on Cash and Cash Equivalents | 19 | (20) |
Net Increase in Cash and Cash Equivalents | 1,190 | 607 |
Cash and Cash Equivalents - Beginning of year | 2,064 | 910 |
Cash and Cash Equivalents - End of period | $3,254 | $1,517 |
Statement Of Financial Position
Statement Of Financial Position Classified (USD $) | ||
In Millions | 9 Months Ended
Sep. 05, 2009 | 9 Months Ended
Dec. 27, 2008 |
Current Assets | ||
Cash and cash equivalents | $3,254 | $2,064 |
Short-term investments | 206 | 213 |
Accounts and notes receivable, less allowance: 9/09 - $78, 12/08 - $70 | 5,216 | 4,683 |
Inventories | ||
Raw materials | 1,333 | 1,228 |
Work-in-process | 267 | 169 |
Finished goods | 1,116 | 1,125 |
Inventory, Net, Total | 2,716 | 2,522 |
Prepaid expenses and other current assets | 1,024 | 1,324 |
Total Current Assets | 12,416 | 10,806 |
Property, Plant and Equipment | 23,848 | 22,552 |
Accumulated Depreciation | (11,815) | (10,889) |
Property, Plant and Equipment, Net, Total | 12,033 | 11,663 |
Amortizable Intangible Assets, net | 843 | 732 |
Goodwill | 6,351 | 5,124 |
Other Nonamortizable Intangible Assets | 1,702 | 1,128 |
Nonamortizable Intangible Assets | 8,053 | 6,252 |
Investments in Noncontrolled Affiliates | 4,339 | 3,883 |
Other Assets | 936 | 2,658 |
Total Assets | 38,620 | 35,994 |
Current Liabilities | ||
Short-term obligations | 511 | 369 |
Accounts payable and other current liabilities | 8,141 | 8,273 |
Income taxes payable | 643 | 145 |
Total Current Liabilities | 9,295 | 8,787 |
Long-term Debt Obligations | 7,434 | 7,858 |
Other Liabilities | 5,713 | 6,541 |
Deferred Income Taxes | 347 | 226 |
Total Liabilities | 22,789 | 23,412 |
Commitments and Contingencies | - | - |
Preferred Stock, no par value | 41 | 41 |
Repurchased Preferred Stock | (142) | (138) |
PepsiCo Common Shareholders' Equity | ||
Common stock, par value 1 2/3 cents per share: Authorized 3,600 shares, issued 9/09 and 12/08 - 1,782 shares | 30 | 30 |
Capital in excess of par value | 279 | 351 |
Retained earnings | 33,077 | 30,638 |
Accumulated other comprehensive loss | (4,262) | (4,694) |
Less: repurchased common stock, at cost: 9/09 - 223 shares, 12/08 - 229 shares | (13,729) | (14,122) |
Total PepsiCo Common Shareholders' Equity | 15,395 | 12,203 |
Noncontrolling interests | 537 | 476 |
Total Equity | 15,831 | 12,582 |
Total Liabilities and Equity | $38,620 | $35,994 |
1_Statement Of Financial Positi
Statement Of Financial Position Classified (Parenthetical) (USD $) | ||
In Millions | Sep. 05, 2009
| Dec. 27, 2008
|
Accounts and notes receivable, allowance | $78 | $70 |
Preferred Stock, par value | $0 | $0 |
Common stock, par value | 0.016667 | 0.016667 |
Common stock, Authorized | 3,600 | 3,600 |
Common stock, Issued | 1,782 | 1,782 |
Repurchased common stock, shares | 223 | 229 |
Statement Of Shareholders Equit
Statement Of Shareholders Equity And Other Comprehensive Income (USD $) | |||||||||||||||||||
In Millions | Repurchased Preferred Stock
| Repurchased Common Stock [Member]
| Preferred Stock Amount
| Common Stock Amount
| Capital in Excess of Par Value
| Retained Earnings
| Accumulated Other Comprehensive Loss
| Repurchased Common Stocks [Member]
| Total Common Shareholders' Equity
| Noncontrolling Interests
| Total
| ||||||||
Balance, beginning of year at Dec. 29, 2007 | ($132) | $450 | $28,184 | ($952) | ($10,387) | $62 | |||||||||||||
Balance, beginning of year at Dec. 29, 2007 | -0.5 | (177) | |||||||||||||||||
Share repurchases | (62) | ||||||||||||||||||
Redemptions | 0 | ||||||||||||||||||
Stock option exercises | 12 | ||||||||||||||||||
Other, primarily RSUs converted | 2 | ||||||||||||||||||
SFAS 158 measurement date change | 51 | ||||||||||||||||||
SFAS 158 measurement date change | (89) | ||||||||||||||||||
Share repurchases | (4,265) | ||||||||||||||||||
Stock-based compensation expense | 169 | ||||||||||||||||||
Redemptions | (4) | ||||||||||||||||||
Stock option exercises | 692 | ||||||||||||||||||
Stock option exercises/RSUs converted | (228) | [1] | |||||||||||||||||
Adjusted balance, beginning of year | 28,095 | (901) | |||||||||||||||||
Withholding tax on RSUs converted | (49) | ||||||||||||||||||
Net income | 4,423 | 17 | 4,440 | ||||||||||||||||
Cash dividends declared - common | (1,930) | ||||||||||||||||||
Purchase of subsidiary shares from noncontrolling interests, net | 436 | ||||||||||||||||||
Currency translation adjustment | (91) | 1 | (90) | ||||||||||||||||
Cash dividends declared - preferred | (1) | ||||||||||||||||||
Cash flow hedges, net of tax: | |||||||||||||||||||
Net derivative (losses)/gains | 8 | 8 | |||||||||||||||||
Reclassification of derivative (gains)/losses to net income | 13 | 13 | |||||||||||||||||
Cash dividends declared - RSUs | (6) | ||||||||||||||||||
Reclassification of pension and retiree medical losses to net income, net of tax | 57 | 57 | |||||||||||||||||
Unrealized gains/(losses) on securities, net of tax | (19) | (19) | |||||||||||||||||
Other, net | 99 | (5) | |||||||||||||||||
Other | (12) | (12) | |||||||||||||||||
Balance, end of period at Sep. 06, 2008 | 0.8 | -0.5 | 1,782 | (225) | |||||||||||||||
Balance, end of period at Sep. 06, 2008 | (136) | 41 | 30 | 342 | 30,581 | (945) | (13,861) | 16,147 | 511 | 16,563 | |||||||||
Balance, beginning of year at Jun. 14, 2008 | 41 | 30 | 16,147 | ||||||||||||||||
Balance, beginning of year at Jun. 14, 2008 | 0.8 | 1,782 | |||||||||||||||||
Cash flow hedges, net of tax: | |||||||||||||||||||
Balance, end of period at Sep. 06, 2008 | 0.8 | 1,782 | |||||||||||||||||
Balance, end of period at Sep. 06, 2008 | 41 | 30 | 16,147 | ||||||||||||||||
Balance, beginning of year at Dec. 27, 2008 | (138) | 351 | 30,638 | (4,694) | (14,122) | 476 | 12,582 | ||||||||||||
Balance, beginning of year at Dec. 27, 2008 | -0.5 | (229) | |||||||||||||||||
Share repurchases | 0 | ||||||||||||||||||
Redemptions | -0.1 | ||||||||||||||||||
Stock option exercises | 5 | ||||||||||||||||||
Other, primarily RSUs converted | 1 | ||||||||||||||||||
SFAS 158 measurement date change | 0 | ||||||||||||||||||
SFAS 158 measurement date change | 0 | ||||||||||||||||||
Share repurchases | 0 | ||||||||||||||||||
Stock-based compensation expense | 159 | ||||||||||||||||||
Redemptions | (4) | ||||||||||||||||||
Stock option exercises | 306 | ||||||||||||||||||
Stock option exercises/RSUs converted | (197) | [1] | |||||||||||||||||
Adjusted balance, beginning of year | 0 | 0 | |||||||||||||||||
Withholding tax on RSUs converted | (34) | ||||||||||||||||||
Net income | 4,512 | 30 | 4,542 | ||||||||||||||||
Cash dividends declared - common | (2,065) | ||||||||||||||||||
Purchase of subsidiary shares from noncontrolling interests, net | 80 | ||||||||||||||||||
Currency translation adjustment | 485 | (41) | 444 | ||||||||||||||||
Cash dividends declared - preferred | (1) | ||||||||||||||||||
Cash flow hedges, net of tax: | |||||||||||||||||||
Net derivative (losses)/gains | (76) | (76) | |||||||||||||||||
Reclassification of derivative (gains)/losses to net income | (6) | (6) | |||||||||||||||||
Cash dividends declared - RSUs | (7) | ||||||||||||||||||
Reclassification of pension and retiree medical losses to net income, net of tax | 16 | 16 | |||||||||||||||||
Unrealized gains/(losses) on securities, net of tax | 12 | 12 | |||||||||||||||||
Other, net | 87 | (8) | |||||||||||||||||
Other | 1 | 1 | |||||||||||||||||
Balance, end of period at Sep. 05, 2009 | 0.8 | -0.6 | 1,782 | (223) | |||||||||||||||
Balance, end of period at Sep. 05, 2009 | (142) | 41 | 30 | 279 | 33,077 | (4,262) | (13,729) | 15,395 | 537 | 15,831 | |||||||||
Balance, beginning of year at Jun. 13, 2009 | 41 | 30 | 15,395 | ||||||||||||||||
Balance, beginning of year at Jun. 13, 2009 | 0.8 | 1,782 | |||||||||||||||||
Cash flow hedges, net of tax: | |||||||||||||||||||
Balance, end of period at Sep. 05, 2009 | 0.8 | 1,782 | |||||||||||||||||
Balance, end of period at Sep. 05, 2009 | $41 | $30 | $15,395 | ||||||||||||||||
[1]Includes total tax benefit of $7 million in 2009 and $71 million in 2008. |
Statement Of Other Comprehensiv
Statement Of Other Comprehensive Income (USD $) | ||||
In Millions | 3 Months Ended
Sep. 05, 2009 | 3 Months Ended
Sep. 06, 2008 | 9 Months Ended
Sep. 05, 2009 | 9 Months Ended
Sep. 06, 2008 |
Net income | $1,733 | $1,583 | $4,542 | $4,440 |
Other Comprehensive Income | ||||
Currency translation adjustment | 225 | (451) | 444 | (90) |
Reclassification of pension and retiree medical losses to net income, net of tax | 6 | 20 | 16 | 57 |
Cash flow hedges, net of tax: | ||||
Net derivative (losses)/gains | (53) | (23) | (76) | 8 |
Reclassification of derivative (gains)/losses to net income | 10 | 4 | (6) | 13 |
Unrealized gains/(losses) on securities, net of tax | 8 | (14) | 12 | (19) |
Other | 1 | (8) | 1 | (12) |
Other Comprehensive Income (Loss), Net of Tax, Total | 197 | (472) | 391 | (43) |
Comprehensive Income | 1,930 | 1,111 | 4,933 | 4,397 |
Comprehensive (income)/loss attributable to noncontrolling interests | (37) | (7) | 11 | (18) |
Comprehensive Income Attributable to PepsiCo | $1,893 | $1,104 | $4,944 | $4,379 |
Basis of Presentation and Our D
Basis of Presentation and Our Divisions | |
9 Months Ended
Sep. 05, 2009 USD / shares | |
Notes to Financial Statements [Abstract] | |
Basis of Presentation and Our Divisions | Basis of Presentation and Our Divisions Basis of Presentation Our Condensed Consolidated Balance Sheet as of September5, 2009, the Condensed Consolidated Statements of Income and Comprehensive Income for the 12 and 36 weeks ended September5, 2009 and September6, 2008, and the Condensed Consolidated Statements of Cash Flows and Equity for the 36 weeks ended September5, 2009 and September6, 2008 have not been audited. These statements have been prepared on a basis that is substantially consistent with the accounting principles applied in our Annual Report on Form 10-K for the fiscal year ended December27, 2008 and in our Current Report on Form 8-K dated August27, 2009. In our opinion, these financial statements include all normal and recurring adjustments necessary for a fair presentation. The results for the 12 and 36 weeks are not necessarily indicative of the results expected for the full year. Our significant interim accounting policies include the recognition of a pro rata share of certain estimated annual sales incentives, and certain advertising and marketing costs, generally in proportion to revenue, and the recognition of income taxes using an estimated annual effective tax rate. Raw materials, direct labor and plant overhead, as well as purchasing and receiving costs, costs directly related to production planning, inspection costs and raw material handling facilities, are included in cost of sales. The costs of moving, storing and delivering finished product are included in selling, general and administrative expenses. Our share of equity income or loss from our anchor bottlers is recorded as bottling equity income in our income statement. There were no sales of PBG or PAS stock in the 12 and 36 weeks ended September5, 2009. Bottling equity income includes pre-tax gains on our sales of PBG and PAS stock of $45 million and $145 million in the 12 and 36 weeks ended September6, 2008, respectively. Our share of income or loss from other noncontrolled affiliates is recorded as a component of selling, general and administrative expenses. While the majority of our results are reported on a period basis, most of our international operations report on a monthly calendar basis for which the months of June, July and August are reflected in our third quarter results and the months of January through August are reflected in our year-to-date results. The following information is unaudited. Tabular dollars are presented in millions, except per share amounts. All per share amounts reflect common per share amounts, assume dilution unless otherwise noted, and are based on unrounded amounts. Certain reclassifications were made to prior year amounts to conform to the 2009 presentation. This report should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended December27, 2008 and our Current Report on Form 8-K dated August27, 2009, which includes historical segment information on a basis consistent with our current segment reporting structure, and in which we adopted the presentation and disclosure requirements of Statement of Financial Accounting Standards (SFAS) No.160, Noncontrolling Interests in Con |
Intangible Assets
Intangible Assets | |
9 Months Ended
Sep. 05, 2009 USD / shares | |
Notes to Financial Statements [Abstract] | |
Intangible Assets | Intangible Assets 9/5/09 12/27/08 Amortizable intangible assets, net Brands $ 1,451 $ 1,411 Other identifiable intangibles 492 360 1,943 1,771 Accumulated amortization (1,100 ) (1,039 ) $ 843 $ 732 The change in the book value of nonamortizable intangible assets is as follows: Balance 12/27/08 Acquisitions Translation andOther Balance 9/5/09 FLNA Goodwill $ 277 $ 6 $ 17 $ 300 Brands 26 2 28 277 32 19 328 QFNA Goodwill 175 175 LAF Goodwill 424 2 25 451 Brands 127 6 133 551 2 31 584 PAB Goodwill 2,355 7 2,362 Brands 59 59 2,414 7 2,421 Europe Goodwill 1,469 1,291 (190 ) 2,570 Brands 844 572 (54 ) 1,362 2,313 1,863 (244 ) 3,932 AMEA Goodwill 424 69 493 Brands 98 22 120 522 91 613 Total goodwill 5,124 1,299 (72 ) 6,351 Total brands 1,128 598 (24 ) 1,702 $ 6,252 $ 1,897 $ (96 ) $ 8,053 |
Stock-Based Compensation
Stock-Based Compensation | |
9 Months Ended
Sep. 05, 2009 USD / shares | |
Notes to Financial Statements [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation For the 12 weeks, we recognized stock-based compensation expense of $51 million in 2009 and $57 million in 2008. For the 36 weeks, we recognized stock-based compensation expense of $159 million in 2009 and $169 million in 2008. For the 12 weeks in 2009, our grants of stock options and restricted stock units (RSU) were nominal. For the 36 weeks in 2009, we granted 15million stock options at a weighted-average grant price of $53.02 and 3million RSUs at a weighted-average grant price of $53.03, under the terms of our 2007 Long-Term Incentive Plan. Our weighted-average Black-Scholes fair value assumptions are as follows: 36WeeksEnded 9/5/09 9/6/08 Expected life 6yrs. 6yrs. Risk free interest rate 2.8 % 2.9 % Expected volatility(a) 17 % 16 % Expected dividend yield 3.0 % 1.9 % (a) Reflects movements in our stock price over the most recent historical period equivalent to the expected life. |
Pension and Retiree Medical Ben
Pension and Retiree Medical Benefits | |
9 Months Ended
Sep. 05, 2009 USD / shares | |
Notes to Financial Statements [Abstract] | |
Pension and Retiree Medical Benefits | Pension and Retiree Medical Benefits The components of net periodic benefit cost for pension and retiree medical plans are as follows: 12 Weeks Ended Pension RetireeMedical 9/5/09 9/6/08 9/5/09 9/6/08 9/5/09 9/6/08 U.S. International Service cost $ 55 $ 57 $ 11 $ 16 $ 11 $ 10 Interest cost 86 86 20 23 18 19 Expected return on plan assets (107 ) (96 ) (25 ) (29 ) Amortization of prior service cost/(benefit) 3 4 (4 ) (3 ) Amortization of experience loss 26 13 2 5 3 2 63 64 8 15 28 28 Curtailment gain (1 ) Total expense $ 62 $ 64 $ 8 $ 15 $ 28 $ 28 36 Weeks Ended Pension RetireeMedical 9/5/09 9/6/08 9/5/09 9/6/08 9/5/09 9/6/08 U.S. International Service cost $ 165 $ 171 $ 30 $ 44 $ 31 $ 30 Interest cost 258 258 53 63 56 57 Expected return on plan assets (320 ) (288 ) (67 ) (80 ) Amortization of prior service cost/ (benefit) 8 12 1 1 (12 ) (9 ) Amortization of experience loss 77 39 5 14 8 6 188 192 22 42 83 84 Curtailment gain (3 ) Total expense $ 185 $ 192 $ 22 $ 42 $ 83 $ 84 |
Net Income Attributable to Peps
Net Income Attributable to PepsiCo per Common Share | |
9 Months Ended
Sep. 05, 2009 USD / shares | |
Notes to Financial Statements [Abstract] | |
Net Income Attributable to PepsiCo per Common Share | Net Income Attributable to PepsiCo per Common Share The computations of basic and diluted net income attributable to PepsiCo per common share are as follows: 12 Weeks Ended 9/5/09 9/6/08 Income Shares(a) Income Shares(a) Net income attributable to PepsiCo $ 1,717 $ 1,576 Preferred shares: Dividends Redemption premium (1 ) (2 ) Net income available for PepsiCo common shareholders $ 1,716 1,558 $ 1,574 1,564 Basic net income attributable to PepsiCo per common share $ 1.10 $ 1.01 Net income available for PepsiCo common shareholders $ 1,716 1,558 $ 1,574 1,564 Dilutive securities: Stock options and RSUs(b) 18 28 ESOP convertible preferred stock 1 1 2 1 Diluted $ 1,717 1,577 $ 1,576 1,593 Diluted net income attributable to PepsiCo per common share $ 1.09 $ 0.99 36 Weeks Ended 9/5/09 9/6/08 Income Shares(a) Income Shares(a) Net income attributable to PepsiCo $ 4,512 $ 4,423 Preferred shares: Dividends (1 ) (1 ) Redemption premium (3 ) (4 ) Net income available for PepsiCo common shareholders $ 4,508 1,557 $ 4,418 1,582 Basic net income attributable to PepsiCo per common share $ 2.90 $ 2.79 Net income available for PepsiCo common shareholders $ 4,508 1,557 $ 4,418 1,582 Dilutive securities: Stock options and RSUs(b) 15 29 ESOP convertible preferred stock 4 1 5 1 Diluted $ 4,512 1,573 $ 4,423 1,612 Diluted net income attributable to PepsiCo per common share $ 2.87 $ 2.74 (a) Weighted-average common shares outstanding. (b) Options to purchase 31million and 47million shares, respectively, for the 12 and 36 weeks in 2009 were not included in the calculation of earnings per share because these options were out-of-the-money. Out-of-the-money options for the 12 and 36 weeks in 2009 had average exercise prices of $64.02 and $60.43, respectively. Options to purchase 12million and 4million shares, respectively, for the 12 and 36 weeks in 2008 were not included in the calculation of earnings per share because these options were out-of-the-money. These out-of-the-money options had average exercise prices of $68.86 and $71.94, respectively. |
Debt Obligations
Debt Obligations | |
9 Months Ended
Sep. 05, 2009 USD / shares | |
Notes to Financial Statements [Abstract] | |
Debt Obligations | Debt Obligations In the first quarter of 2009, we issued $1.0 billion of senior unsecured notes, bearing interest at 3.75%per year and maturing in 2014. We used the proceeds from the issuance of these notes for general corporate purposes. As of September5, 2009, short-term obligations totaled $0.5 billion, of which $0.2 billion was comprised of commercial paper. In the third quarter of 2009, we entered into a new 364-day unsecured revolving credit agreement which enables us to borrow up to $1.975 billion, subject to customary terms and conditions, and expires in June 2010. We may request renewal of this facility for an additional 364-day period or convert any amounts outstanding into a term loan for a period of up to one year, which would mature no later than June 2011. This agreement replaced a $1.8 billion 364-day unsecured revolving credit agreement we entered into during the fourth quarter of 2008. Funds borrowed under this agreement may be used to repay outstanding commercial paper issued by us or our subsidiaries and for other general corporate purposes, including working capital, capital investments and acquisitions. This agreement is in addition to our existing $2.0 billion unsecured revolving credit agreement which expires in 2012. Our lines of credit remain unused as of September5, 2009. We have received commitment letters pursuant to which, subject to the conditions set forth therein, a group of lenders have committed to provide up to $4.0 billion of loans under a bridge facility. The bridge facility will be available to us, as the borrower, on a revolving basis for a period of 364 days from the closing date of the Mergers (as defined in Acquisition of Common Stock of PBG and PAS). The bridge loans, if required, will be used to finance a portion of the purchase price for the Mergers and to pay related fees and expenses. We will be required to prepay the bridge loans under specified circumstances, including upon specified non-ordinary course asset sales, specified incurrences of debt, and equity issuances by us or our subsidiaries and upon the issuance of debt securities for the purpose of refinancing the bridge facility. Documentation governing the bridge facility has not been finalized. Accordingly, the actual terms of these financing arrangements may differ from those described herein. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | |
9 Months Ended
Sep. 05, 2009 USD / shares | |
Notes to Financial Statements [Abstract] | |
Supplemental Cash Flow Information | Supplemental Cash Flow Information 36WeeksEnded 9/5/09 9/6/08 Interest paid $ 319 $ 257 Income taxes paid, net of refunds $ 541 $ 747 Acquisitions: Fair value of assets acquired $ 557 $ 2,624 Cash paid (266 ) (1,707 ) Liabilities and noncontrolling interests assumed $ 291 $ 917 |
Restructuring and Impairment Ch
Restructuring and Impairment Charges | |
9 Months Ended
Sep. 05, 2009 USD / shares | |
Notes to Financial Statements [Abstract] | |
Restructuring and Impairment Charges | Restructuring and Impairment Charges In the fourth quarter of 2008, we incurred a charge of $543 million ($408 million after-tax or $0.25 per share) in conjunction with our Productivity for Growth program. The program includes actions in all divisions of the business, including the closure of six plants that we believe will increase cost competitiveness across the supply chain, upgrade and streamline our product portfolio, and simplify the organization for more effective and timely decision-making. In the 36 weeks ended September5, 2009, we incurred charges of $36 million ($29 million after-tax or $0.02 per share) in conjunction with this program. These charges were recorded in selling, general and administrative expenses. These initiatives were completed in the second quarter of 2009, and substantially all cash payments related to these charges are expected to be paid by 2010. A summary of our restructuring and impairment charges in 2009 is as follows: 36 Weeks Ended SeveranceandOther Employee Costs(a) Other Costs Total FLNA $ $ 2 $ 2 QFNA 1 1 LAF 3 3 PAB 6 10 16 Europe 1 1 AMEA 7 6 13 $ 17 $ 19 $ 36 (a) Primarily reflects termination costs for approximately 410 employees. A summary of our restructuring and impairment activity is as follows: SeveranceandOther Employee Costs Other Costs Total Liability as of December27, 2008 $ 134 $ 64 $ 198 2009 restructuring and impairment charges 17 19 36 Cash payments (116 ) (67 ) (183 ) Currency translation and other (4 ) 15 11 Liability as of September5, 2009 $ 31 $ 31 $ 62 |
Financial Instruments
Financial Instruments | |
9 Months Ended
Sep. 05, 2009 USD / shares | |
Notes to Financial Statements [Abstract] | |
Financial Instruments | Financial Instruments In March 2008, the Financial Accounting Standards Board (FASB) issued SFAS No.161, Disclosures about Derivative Instruments and Hedging Activities (SFAS 161), which amends and expands the disclosure requirements of SFAS No.133, Accounting for Derivative Instruments and Hedging Activities (SFAS 133), to provide an enhanced understanding of the use of derivative instruments, how they are accounted for under SFAS 133 and their effect on financial position, financial performance and cash flows. We adopted the disclosure provisions of SFAS 161 in the first quarter of 2009. We are exposed to market risks arising from adverse changes in: commodity prices, affecting the cost of our raw materials and energy, foreign exchange risks, and interest rates. In the normal course of business, we manage these risks through a variety of strategies, including the use of derivatives. Certain derivatives are designated as either cash flow or fair value hedges and qualify for hedge accounting treatment, while others do not qualify and are marked to market through earnings. Cash flows from derivatives used to manage commodity, foreign exchange or interest risks are classified as operating activities. See Our Business Risks in Managements Discussion and Analysis of Financial Condition and Results of Operations for further unaudited information on our business risks. For cash flow hedges, changes in fair value are deferred in accumulated other comprehensive loss within common shareholders equity until the underlying hedged item is recognized in net income. For fair value hedges, changes in fair value are recognized immediately in earnings, consistent with the underlying hedged item. Hedging transactions are limited to an underlying exposure. As a result, any change in the value of our derivative instruments would be substantially offset by an opposite change in the value of the underlying hedged items. Hedging ineffectiveness and a net earnings impact occur when the change in the value of the hedge does not offset the change in the value of the underlying hedged item. Ineffectiveness of our hedges is not material. If the derivative instrument is terminated, we continue to defer the related gain or loss and then include it as a component of the cost of the underlying hedged item. Upon determination that the underlying hedged item will not be part of an actual transaction, we recognize the related gain or loss in net income immediately. We also use derivatives that do not qualify for hedge accounting treatment. We account for such derivatives at market value with the resulting gains and losses reflected in our income statement. We do not use derivative instruments for trading or speculative purposes. We enter into arrangements with individual counterparties that we believe are creditworthy and generally settle on a net basis. In addition, we perform a quarterly assessment of our counterparty credit risk, including a review of credit ratings, credit default swap rates and potential nonperformance of the counterparty. Based on our most recent quarterly assessment of our counterparty credit risk, we consider |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | |
9 Months Ended
Sep. 05, 2009 USD / shares | |
Notes to Financial Statements [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In December 2007, the FASB issued SFAS No.141 (revised 2007), Business Combinations (SFAS 141R), to improve, simplify and converge internationally the accounting for business combinations. SFAS 141R continues the movement toward the greater use of fair value in financial reporting and increased transparency through expanded disclosures. We adopted the provisions of SFAS 141R as of the beginning of our 2009 fiscal year and the adoption did not have a material impact on our financial statements. However, SFAS 141R changes how business acquisitions are accounted for and will impact financial statements both on the acquisition date and in subsequent periods. Additionally, under SFAS 141R, transaction costs are now expensed rather than capitalized. Future adjustments made to valuation allowances on deferred taxes and acquired tax contingencies associated with acquisitions that closed prior to the beginning of our 2009 fiscal year apply the provisions of SFAS 141R and will be evaluated based on the outcome of these matters. In December 2007, the FASB issued SFAS 160. SFAS 160 amends Accounting Research Bulletin No.51 (ARB 51) to establish new standards that will govern the accounting for and reporting of (1)noncontrolling interests in partially owned consolidated subsidiaries and (2)the loss of control of subsidiaries. We adopted the accounting provisions of SFAS 160 on a prospective basis as of the beginning of our 2009 fiscal year. The adoption of SFAS 160 did not have a material impact on our financial statements. In addition, we adopted the presentation and disclosure requirements of SFAS 160 on a retrospective basis in the first quarter of 2009. In May 2009, the FASB issued SFAS No.165, Subsequent Events (SFAS 165). SFAS 165 establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before the financial statements are issued or are available to be issued. Although the standard is based on the same principles as those that currently exist in the auditing standards, it includes a new required disclosure of the date through which an entity has evaluated subsequent events. We adopted the provisions of SFAS 165 in the third quarter of 2009. We evaluated subsequent events through October8, 2009, the date the financial statements were issued, and determined that there have been no events that have occurred that would require adjustments to our financial statements. |
Acquisition of Common Stock of
Acquisition of Common Stock of PBG and PAS | |
9 Months Ended
Sep. 05, 2009 USD / shares | |
Notes to Financial Statements [Abstract] | |
Acquisition of Common Stock of PBG and PAS | Acquisition of Common Stock of PBG and PAS On August3, 2009, we entered into an Agreement and Plan of Merger with PBG and Pepsi-Cola Metropolitan Bottling Company, Inc. (Metro), our wholly-owned subsidiary (the PBG Merger Agreement) and a separate Agreement and Plan of Merger with PAS and Metro (the PAS Merger Agreement). The PBG Merger Agreement provides that, upon the terms and subject to the conditions set forth in the PBG Merger Agreement, PBG will be merged with and into Metro (the PBG Merger), with Metro continuing as the surviving corporation and our wholly owned subsidiary.At the effective time of the PBG Merger, each share of PBG common stock outstanding immediately prior to the effective time not held by us or any of our subsidiaries will be converted into the right to receive either 0.6432 of a share of PepsiCo common stock or, at the election of the holder, $36.50 in cash, without interest, and in each case subject to proration procedures which provide that we will pay cash for a number of shares equal to 50% of the PBG common stock outstanding immediately prior to the effective time of the PBG Merger not held by us or any ofour subsidiaries and issue shares of PepsiCo common stock for the remaining 50% of such shares. Each share of PBG common stock held by PBG as treasury stock, held by us or held by Metro, and each share of PBG Class B common stock held by us or Metro, in each case immediately prior to the effective time of the PBG Merger, will be canceled, and no payment will be made with respect thereto. Each share of PBG common stock and PBG Class B common stock owned by any subsidiary of ours other than Metro immediately prior to the effective time of the PBG Merger will automatically be converted into the right to receive 0.6432 of a share of PepsiCo common stock. The PAS Merger Agreement provides that, upon the terms and subject to the conditions set forth in the PAS Merger Agreement, PAS will be merged with and into Metro (the PAS Merger, and together with the PBG Merger, the Mergers), with Metro continuing as the surviving corporation and our wholly owned subsidiary.At the effective time of the PAS Merger, each share of PAS common stock outstanding immediately prior to the effective time not held by us or any of our subsidiaries will be converted into the right to receive either 0.5022 of a share of PepsiCo common stock or, at the election of the holder, $28.50 in cash, without interest, and in each case subject to proration procedures which provide that we will pay cash for a number of shares equal to 50% of the PAS common stock outstanding immediately prior to the effective time of the PAS Merger not held by us or any of our subsidiaries and issue shares of PepsiCo common stock for the remaining 50% of such shares. Each share of PAS common stock held by PAS as treasury stock, held by us or held by Metro, in each case, immediately prior to the effective time of the PAS Merger, will be canceled, and no payment will be made with respect thereto. Each share of PAS common stock owned by any subsidiary of ours other than Metro immediately prior to the effective time of the PAS Merger will automatically be conve |
Document Information
Document Information | |
9 Months Ended
Sep. 05, 2009 USD / shares | |
Document Information [Text Block] | |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | 2009-09-05 |
Entity Information
Entity Information (USD $) | ||
9 Months Ended
Sep. 05, 2009 | Oct. 02, 2009
| |
Entity [Text Block] | ||
Trading Symbol | PEP | |
Entity Registrant Name | PEPSICO INC | |
Entity Central Index Key | 0000077476 | |
Current Fiscal Year End Date | --12-26 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 1,560,444,589 |