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Pepsi

This document provides an overview and analysis of PepsiCo, including: - A history of PepsiCo from its founding in 1965 through its growth globally and acquisition of brands. - PepsiCo's mission and vision statements, as well as a proposed revised mission and vision. - External assessments of PepsiCo including opportunities, threats, a CPM analysis, EFE matrix, and positioning map. - Internal assessments including strengths, weaknesses, an IFE matrix, income statement, and balance sheet. The document conducts a thorough analysis of PepsiCo's business using multiple frameworks to evaluate its position in the marketplace.

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PepsiCo By: Ashley Cleary, Sylvia LaBrie, Andrea Baril, Marie- Michele Lachance
Overview ∗ Company Overview ∗ Strategy Formulation ∗ History of Pepsi ∗ SWOT Matrix ∗ Grand Strategy Matrix ∗ Growth ∗ BCG ∗ 2009 Events and Issues ∗ Space Matrix Data ∗ Existing Mission and Vision statement ∗ Space Matrix ∗ New Mission and Vision Statement ∗ IE Matrix ∗ SWOT Analysis ∗ Matrix Analysis ∗ ∗ QSPM Matrix External Assessment ∗ Strategic Plan ∗ CPM ∗ Strategy ∗ EFE ∗ Objectives ∗ Positioning Map ∗ Recommendations ∗ Internal Assessment ∗ Assumptions ∗ Organizational Chart ∗ Implementation ∗ EPS/EBIT ∗ Income Statement ∗ Projected Financials ∗ Balance Sheet ∗ Evaluation ∗ Financial ratios ∗ Balanced Scorecard ∗ IFE Matrix ∗ Key Future Ratios
History ∗ In 1965: PepsiCo, Inc. is founded by Donald M. Kendall, President and CEO of Pepsi-Cola and Herman W. Lay, Chairman and CEO of Frito-Lay, through the merger: ∗ 1. Pepsi-Cola In 1898: Caleb Bradham, a New Bern, North Carolina, pharmacist, created "Brad's Drink," a carbonated soft drink he created to serve his drugstore's fountain customers. ∗ 2. Frito Company ∗ ∗ 3. H. W. Lay Company ∗ ∗ The Major products of the companies are: ∗ Pepsi-Cola Company ∗ Fritos brand corn chips, Lay's brand potato chips, Cheetos brand cheese flavored snacks, Ruffles brand potato chips, Rold Gold brand pretzels. ∗ Mountain Dew
Growth 1966: Doritos is introduced Pepsi enters Japan and Eastern Europe. 1970: PepsiCo moves from New York City to new world headquarters in Purchase, N.Y Pepsi is the first company to respond to consumer preference with lightweight, recyclable, plastic bottles. 1977: PepsiCo acquires Pizza Hut, Inc 1978: Taco Bell 1980: PepsiCo Food Service International (PFSI) is formed to focus on overseas development of restaurants.
Growth Cont. 1982: Pepsi Free and Diet Pepsi Free, the first major brand caffeine-free colas, are introduced. Inauguration of the first Pepsi-Cola operation in China. 1985: PepsiCo is now the largest company in the beverage industry. The company has revenues of more than $7.5 billion, more than 137,000 employees. Pepsi-Cola products are available in nearly 150 countries and territories around the world. Snack food operations are in 10 international markets. 1986: PepsiCo purchases 7Up International, the third largest franchise soft drink operation outside the United States. 1993: Pepsi-Cola introduces Aquafina bottled water into test market. 1996: Pepsi-Cola launches Pepsi World at www.pepsiworld.com
Global ∗ Pepsi products are in almost 200 countries throughout the world ∗ There are 22 different brand lines that account for at least $1 billion per year per brand
2009 ∗ Celebrated 75 years in Canada ∗ Was on the “Best Food for Women” list in Women’s Health magazine ∗ Began a partnership with the NFL ∗ Won U.S. EPA SmartWay Environmental Excellence award ∗ Became official beverage of Norwegian Cruise Lines
Mission Statement ∗ Our mission is to be the world's premier consumer products company focused on convenient foods and beverages. We seek to produce financial rewards to investors as we provide opportunities for growth and enrichment to our employees, our business partners and the communities in which we operate. And in everything we do, we strive for honesty, fairness and integrity.
Vision Statement PepsiCo's responsibility is to continually improve all aspects of the world in which we operate - environment, social, economic - creating a better tomorrow than today." Our vision is put into action through programs and a focus on environmental stewardship, activities to benefit society, and a commitment to build shareholder value by making PepsiCo a truly sustainable company.
Proposed Mission ∗ Our mission is to be the world's premier consumer products company focused on convenient foods and beverages through stores as well as our website. (1,2.3,4) We seek to produce financial rewards to investors as we provide opportunities for growth and enrichment to our employees, our business partners and the communities in which we operate. (5,8,9) And in everything we do, we strive for honesty, fairness and integrity. (6,7) 1. Customer 2. Products or Services 3. Markets 4. Technology 5. Concern for survival, profitability, and growth 6. Philosophy 7. Self-Concept 8. Concern for public image 9. Concern for employees
Proposed Vision ∗ PepsiCo, in association with smaller brands, offers a wide variety of products from beverages to snacks at low cost.
External Assessment
Opportunities 1. Opening in market for less costly products 2. Growth opportunities in developed countries as well as international nonestablished countries 3. Pepsi recently reacquired ownership of its two largest bottlers, Pepsi Bottling Group (PBG) and PepsiAmericas (PAS) 4. Compete in more than one industry (non-alcoholic beverage industry, the salty or savory snack food industry, and the breakfast food industry) 5. Growth in the carbonated drink market is the largest in Asia and Europe 6. The world's demand is experiencing a growth with the sports drinks, bottled water, and energy drinks
Threats 1. Fierce competition from Coca-Cola, which owns the largest piece of the market share 2. The downturn in economy, which lead customers to shift away from bottles of water to tap water. 3. Because of the recession, customers are finding cheaper alternatives to the national brands. 4. Customers are getting more conscious and concerned about their eating habits and general health. 5. Campaign against plastic containers has impacted the sale of bottled beverages 6. Highly dependent on supplies of clean water, to prevent contamination
CPM Pepsi Co. Coca Cola Dr. Pepper Snapple Group Critical Success factors Weights Rating Weighted Score Rating Weighted Score Rating Weighted Score 0.0 to 1.0 1 to 4 1 to 4 1 to 4 0 0 0 Advertising 0.12 4 0.48 4 0.48 3 0.36 Price Competitiveness 0.11 3 0.33 3 0.33 2 0.22 Product Diversity 0.1 4 0.4 4 0.4 3 0.3 Market Share 0.1 3 0.3 4 0.4 2 0.2 Company Image 0.12 3 0.36 4 0.48 3 0.36 Customer Loyalty 0.12 4 0.48 4 0.48 3 0.36 Financial Position 0.09 3 0.27 3 0.27 2 0.18 Sales Distrubution 0.08 2 0.16 4 0.32 4 0.32 Product Quality 0.09 4 0.36 4 0.36 3 0.27 Global Expansion 0.07 3 0.21 4 0.28 3 0.21 Totals 1 3.35 3.8 2.78
EFE Weighted Key External Factors Weights Rating Score 0.0 to 1.0 1 to 4 Opening in market for less costly products 0.05 2 0.1 Growth opportunities in developed countries as well as international unestablished countries 0.08 3 0.24 Pepsi recently reacquired ownership of its two largest bottlers, Pepsi Bottling Group (PBG) and PepsiAmericas (PAS) 0.05 1 0.05 Compete in more than one industry (non-alcoholic beverage industry, the salty or savory snack food industry, and the breakfast food industry) 0.13 4 0.52 Growth in the carbonated drink market is the largest in Asia and Europe 0.09 3 0.27 The world's demand is experiencing a growth with the sports drinks, bottled water, and energy drinks. 0.13 4 0.52 Threats     0 Fierce competition from Coca-Cola, which owns the largest piece of the market share 0.12 4 0.48 The downturn in economy, which lead customers to shift away from bottles of water to tap water. 0.05 2 0.1 Because of the recession, customers are finding cheaper alternatives to the national brands. 0.1 3 0.3 Customers are getting more conscious and concerned about their eating habits and general health. 0.09 4 0.36 Campaign against plastic containers has impacted the sale of bottled beverages 0.05 2 0.1 Highly dependent on supplies of clean water, to prevent contamination 0.06 2 0.12 Totals 1 3.16
Positioning Map High Prices Limited Diverse Products Products Dr. Pepper Coca Cola Pepsi Co. Snapple Group Low Prices
Market Share
Revenue Distribution
Stock Price History
Internal Assessment
Strengths 1. Strong brand equity 2. Well-known worldwide 3. Innovating company 4. Ethical, socially responsible, and sustainable company 5. Strong advertising company with more than 40 slogans and songs 6. PepsiCo as the largest part of the market share after Coca- Cola 7. PepsiCo owns a wide variety of smaller brands which able them to offer a large product range from beverages to snacks
Weaknesses 1.PepsiCo production is really expansive because of the need to constantly develop new products to meet the changing customers demands 2. PepsiCo is experiencing a lack of focus towards Pepsi sodas 3. PepsiCo is experiencing product recalls 4. PepsiCo has a low employment productivity and a weak distribution 5. PepsiCo depends too much on the US market 6. PepsiCo is far behind Coca-Cola in the international market
IFE Weighted Key Internal Factors Weights Rating Score 0.0 to 1.0 1, 2, 3 or 4 Internal Strengths 3 or 4 Strong brand equity 0.12 4 0.48 Well known worldwide 0.06 4 0.24 PepsiCo owns a wide variety of smaller brands which able them to offer a large product range 0.08 4 0.32 Innovating company 0.08 4 0.32 Ethical, socially responsible, and sustainable company 0.05 3 0.15 Strong advertising company with more than 40 slogans and songs 0.07 3 0.21 PepsiCo as the largest part of the market share after Coca-Cola 0.06 4 0.24 Internal Weaknesses 1 or 2 PepsiCo production is really expensive because of the need to constantly develop new products to meet the changing costumers demands 0.05 2 0.1 PepsiCo is experiencing a lack of focus towards Pepsi 0.06 2 0.12 PepsiCo is experiencing product recalls 0.12 1 0.12 PepsiCo has low employment productivity and a weak distribution 0.08 1 0.08 PepsiCo depends too much on the US market 0.08 2 0.16 PepsiCo is far behind Coca-Cola in the international market 0.09 2 0.18 Totals 1 2.72
Income Statement (in millions except per share amounts) 2009 Net Revenue $43,232.00 Cost of sales $20,099.00 Selling, general and administrative expenses $15,026.00 Amortization of intangible assets $63.00 Operating Profit $8,044.00 Bottling equity income $365.00 Interest expense ($397.00) Interest income $67.00 Income before Income Taxes $8,079.00 Provision for Income Taxes $2,100.00 Net Income $5,979.00 Less: Net income attributable to noncontrolling interests $33.00 Net Income Attributable to PepsiCo $5,946.00 Net Income Attributable to PepsiCo per Common Share Basic $3.81 Diluted $3.77
(In millions except per share amounts) 2009 Balance Sheet Assets Current Assets Cash and cash equivalents $ 3,943.00 Short-term investments $ 192.00 Accounts and notes receivable, net $ 4,624.00 Inventories $ 2,618.00 Prepaid expenses and other current assets $ 1,194.00 Total Current Assets $ 12,571.00 Property, Plant and Equipment, net $ 12,671.00 Amortizable Intangible Assets, net $ 841.00 Goodwill $ 6,534.00 Other nonamortizable itangible assets $ 1,782.00 Nonamortizable Intangible Assets $ 8,316.00 Investments in Noncontrolled Affiliates $ 4,484.00 Other Assets $ 965.00 Total Assets $ 39,848.00 Liabilities and Equity Current Liabilities Short-term obligations $ 464.00 Accounts payable and other current liabilities $ 8,127.00 Income taxes Payable $ 165.00 Total Current Liabilities $ 8,756.00 Long-Term Debt Obligations $ 7,400.00 Other Liabilities $ 5,591.00 Deferred Income Taxes $ 659.00 Total Liabilities $ 22,406.00 Commitments and Contigencies Preferred Stock, no par value $ 41.00 Repurchased Preferred Stock $ (145.00) PepsiCo Common Shareholders' Equity Common stock, par value 1 2/3 cents per share (authorized 3,600 shares, issued 1,782 shares) $ 30.00 Capital in excess of par value $ 250.00 Retained earnings $ 33,805.00 Accumulated other comprehensive loss $ (3,794.00) Repurchased common stock, at cost (217 and 229 shares,respectively) $ (13,383.00) Total PepsiCo Common Shareholders' Equity $ 16,908.00 Noncontrolling interests $ 638.00 Total Equity $ 17,442.00 Total Liabilities and Equity $ 39,848.00
Liquidity Ratios 2009 2008 Financial Ratios Current Ratio 1.44 1.23 Quick Ratio 1.14 0.94 Leverage Ratios Debt-to-Total Assets 0.56 0.65 Ratio Debt-to-equity Ratio 1.33 1.86 Long-term debt-to-equity 0.44 0.62 Ratio Times-Interest-earned -17.1 -24.3 Ratio Activity Ratios Inventory Turns 16.5 17.15 Fixed Assets Turnover 3.41 3.71 Total Assets Turnover 1.08 1.2 Profitability Ratios Gross Profit margins 0.54 0.53 Operating Profit Margin 0.19 0.16 Net Profit Margin 0.14 0.12 Return on Total Assets 0.15 0.14 Return on Stockholders 0.35 0.41 equity Earning per share 3.36 2.9 Price-earnings Ratio 8.94 10.35 Growth Rations (yearly) Sales -0.04% 9.57% Net Income 15.74% -8.89% Earnings per share -0.27% -5.87%
Financial Trends Net Return Return Profit Book on on Price/ Price/ Margin Value/ Debt/ Equity Assets Interest Avg P/E Sales Book (%) Share Equity (%) (%) Coverage 1-Dec-09 14.7 2.22 5.68 13.7 $10.74 0.47 35.4 14.9 20.3 1-Dec-08 20.6 2.02 7 11.9 $7.80 0.68 42.5 14.3 21.2 1-Dec-07 19.6 3.24 7.17 14.4 $10.74 0.24 33 16.4 32.1 1-Dec-06 18.3 3 6.67 16 $9.38 0.18 36.7 18.9 27.2 1-Dec-05 23.3 3.1 6.87 12.5 $8.61 0.37 28.6 12.9 23.1 1-Dec-04 21.2 3.07 6.45 14.2 $8.05 0.26 30.9 14.9 31.5 1-Dec-03 21.6 3 6.67 13.2 $6.96 0.19 30 14.1 29.3 1-Dec-02 27.7 2.96 7.53 11.8 $5.53 0.29 31.5 12.8 24.1 Adapted from www.moneycentral.msn.com
Organizational Chart
Revenues and Profits
Strategy Formulation
SWOT Matrix SO Strategies ST Strategies WO Strategies WT Strategies (O4, S1, S2, S6, S7) (T1, S1, S2, S3, S8) (W2, W5, W6, O2, O5) (W1, T2, T5) Adjust Continue to offer Innovate Pepsi product Expand Pepsi sodas production of bottles variety or product in line with something product in Europe and with downturn in various brands. that is going to Asia. economy. (O5, O2, S2) Expand differentiate us from (W1, O4, O6) Improve (W1, T3) Produce and focus on the Coca-Cola. their sales in the bigger size of bottles carbonated drinks and (S1, S3, O4) Innovate beverage segment by and sale them at the beverage segment in products by offering responding to the same price as the small Asia and Europe. healthier alternatives. increasing demand for one. (O6, O4, S6, S7) (T2, T3, S3) Offer more sports drinks, bottled (W3, T6) Be Respond to the promotions or water, and energy responsible and growing demand of discounts to prevent drinks. cautious towards sports drinks, bottled sales from decreasing. supplies of water. water, and energy (T5, S1, S2, S4) (W1, W4, T6) Increase drinks by expanding Develop more supply chain product market. environmentally production by friendly containers. monitoring cautiously (T6, S6) Support employees and improving workers environmental issues, training. such as pollution, (W5, W6, T1) Increase which causes water presence in the contamination. international market.
Grand Strategy Matrix
BCG Division Revenue % Revenue Profit Profit % Market Share Market Growth Frito-Lay North America $ 13,224.00 31% $ 3,258.00 38% 1 5.42% Quaker Foods North America $ 1,884.00 4% $ 628.00 7% 1 -0.95% Latin America Foods $ 5,703.00 13% $ 904.00 10% 1 -3.26% PepsiCo Americas Beverages $ 10,116.00 23% $ 2,172.00 25% 0.8 -7.51% Europe $ 6,727.00 16% $ 932.00 11% 0.4 -2.38% Asia, Middle East & Africa $ 5,578.00 13% $ 716.00 8% 0.3 8.97% Total $ 43,232.00 100% $ 8,610.00 100%
BCG Cont.
SPACE Matrix Financial Strength rating is 1 (worst) to 6 (best) Ratings 1 Liquidity 4.0 2 Cash Flow 5.0 3 Return on investment 4.0 4 Earnings per share 4.0 Industry Strength rating is 1 (worst) to 6 (best) FS Total 17.0 1 Ease of entry 6.0 2 Growth potential 5.0 3 Financial stability 4.0 4 Profit potential 5.0 Environmental Stability rating is -1 (best) to -6 (worst) IS Total 20.0 1 Demand variablity -1.0 2 Price range from competing products -1.0 3 Barriers to entry -1.0 4 Price elasticity of demand -1.0 Competitive advantage rating is -1 (best) to -6 (worst) ES Total -4.0 1 Market share -2.0 2 Product quality -3.0 3 Customer loyalty -3.0 4 Cotrol over suppliers and distributors -3.0 7 CS total -11.0
SPACE Graph 6 5 4 3 2 1 2 3 4 5 6 1 2 3 4 5 6
IE Matrix The IFE Total Weighted scores Strong 3.0  Average 2.0  Weak 1.0 to  to 4.0 to 2.99 1.99 High 3.0 to  4.0 PepsiCo Medium 2.0  The EFE to 2.99 Total Weighted Scores Low 1.0 to  1.99
Matrix Analysis Alternative Strategies IE SPACE BCG GRAND Count Forward Integration x x x 3 Backward Integration x x x 3 Horizontal Integration x x x 3 Market Penetration x x x 3 Market Development x x x 3 Product Development x x x 3 Related Diversific ation x x x 3 Unrelated Diversification x x x 3 Horizontal Diversification x x 2 Joint Venture x x 2 Retrenchement x 1 Divesture x 1 Liquidation x 1
QSPM Innovate products with Improve international healthier alternative segment Key factors Weight AS TAS AS TAS External 1 to 4 1 to 4 Opportunities: Provide less costly products 0.05 1 3 0.15 Improve presence in established countries and increase international market where they are not already settled 0.08 3 0.24 4 0.32 Pepsi recently reacquired ownership of its two largest bottlers, Pepsi Bottling Group (PBG) and PepsiAmericas (PAS) 0.05 0 0 Compete in more than one industry (non-alcoholic beverage industry, the salty or savory snack food industry, and the breakfast food industry) 0.13 4 0.52 3 0.39 Growth in the carbonated drink market is the largest in Asia and Europe 0.09 1 0.09 4 0.36 The world's demand is experiencing a growth with the sports drinks, bottled water, and energy drinks. 0.13 4 0.52 4 0.52 Threats: 0 0 Fierce competition from Coca-Cola, which owns the largest piece of the market share 0.12 3 0.36 3 0.36 The downturn in economy, which lead customers to shift away from bottles of water to tap water. 0.05 1 0.05 4 0.2 Because of the recession, customers are finding cheaper alternatives to the national brands. 0.1 1 0.1 4 0.4 Customers are getting more conscious and concerned about their eating habits and general health. 0.09 4 0.36 0 Campaign against plastic containers has impacted the sale of bottled beverages 0.05 0 1 0.05 Highly dependent on supplies of clean water, to prevent contamination 0.06 0 0 1
QSPM Cont. Internal 1 to 4 1 to 4 Strengths Strong brand equity 0.12 4 0.48 4 0.48 Well known worldwide 0.06 3 0.18 4 0.24 PepsiCo owns a wide variety of smaller brands which able them to offer a large product range from beverages to snacks 0.08 4 0.32 2 0.16 Innovating company 0.08 4 0.32 4 0.32 Ethical, socially responsible, and sustainable company 0.05 2 0.1 3 0.15 Strong advertising company with more than 40 slogans and songs 0.07 3 0.21 3 0.21 PepsiCo as the largest part of the market share after Coca-Cola 0.06 4 0.24 3 0.18 Weaknesses: 0 0 PepsiCo production is really expensive because of the need to constantly develop new products to meet the changing costumers demands 0.05 1 0.05 2 0.1 PepsiCo is experiencing a lack of focus towards Pepsi 0.06 0 0 PepsiCo is experiencing product recalls 0.12 1 0.12 1 0.12 PepsiCo has low employment productivity and a weak distribution 0.08 1 0.08 1 0.08 PepsiCo depends too much on the US market 0.08 2 0.16 1 0.08 PepsiCo is far behind Coca-Cola in the international market 0.09 2 0.18 1 0.09 1 4.68 4.96
Strategic Plan
Strategy ∗ Market development is a strategy that PepsiCo should apply by expanding in countries that not already established ∗ Use forward integration to acquire smaller companies in foreign markets to increase their market share ∗ Product development and related diversification should also be considered while trying to produce and distribute healthier products
Recommendations ∗ In the next 3 years, PepsiCo should acquire 3 brands per year in an international marketplace ∗ One of these 3 brands per year must be healthy ∗ Increase production and distribution of carbonated drinks in Asian and European countries ∗ PepsiCo will expand into Africa to make use of the international market they are not part of
Objectives ∗ Spend $15 million on a healthier more eco-friendly beverage brand in an already established country ∗ Spend $15 million on a healthier more eco-friendly snack brand in an already established country ∗ Spend $10 million to acquire a smaller brand in Africa ∗ Increase our revenues by 5% in 2010 ∗ Start our own environmental cause fund with $1 million
Assumptions ∗ Spend $40 million to acquire new brands ∗ Spend $1 million to start an environmental cause group ∗ Revenue increase of 5% ∗ Decrease short-term and long-term debt by using some of our cash and cash equivalents as well as retained earnings
Implementation
Projected Income Statement (in millions except per share amounts) 2009 2010 Net Revenue $43,232.00 $ 45,393.60 5% increase Cost of sales $20,099.00 $ 21,549.09 Based on previous years % Selling, general and administrative expenses $15,026.00 $ 15,476.78 3% increase based on new brands/territories Amortization of intangible assets $63.00 $ 63.00 Operating Profit $8,044.00 $ 8,304.73 Bottling equity income $365.00 $ 365.00 Interest expense ($397.00) $ (397.00) Interest income $67.00 $ 67.00 Income before Income Taxes $8,079.00 $ 8,339.73 Provision for Income Taxes $2,100.00 $ 2,100.00 Net Income $5,979.00 $ 6,239.73 Less: Net income attributable to noncontrolling interests $33.00 $ 33.00 Net Income Attributable to PepsiCo $5,946.00 $ 6,206.73 Net Income Attributable to PepsiCo per Common Share Basic $3.81 $ 3.98 Diluted $3.77 $ 3.94
Projected Balance Sheet (In millions except per share amounts) 2009 2010 Assets Current Assets Cash and cash equivalents $ 3,943.00 $ 3,264.63 -$10 million for purchasing of new brands also paid off some accounts payable Short-term investments $ 192.00 $ 200.00 Accounts and notes receivable, net $ 4,624.00 $ 5,250.00 Inventories $ 2,618.00 $ 3,500.00 Prepaid expenses and other current assets $ 1,194.00 $ 2,500.00 Total Current Assets $ 12,571.00 $ 14,714.63 Property, Plant and Equipment, net $ 12,671.00 $ 13,938.10 More brands equal 10% increase Amortizable Intangible Assets, net $ 841.00 $ 908.28 Based on previous years % Goodwill $ 6,534.00 $ 6,750.68 Purchased 3 brands and their goodwill Other nonamortizable itangible assets $ 1,782.00 $ 1,783.00 add $1 million for environmental group Nonamortizable Intangible Assets $ 8,316.00 $ 8,533.68 Investments in Noncontrolled Affiliates $ 4,484.00 $ 4,892.34 Other Assets $ 965.00 $ 1,300.00 Total Assets $ 39,848.00 $ 44,287.03 Liabilities and Equity Current Liabilities Short-term obligations $ 464.00 $ 464.00 Accounts payable and other current liabilities $ 8,127.00 $ 7,314.30 Use cash to reduce accounts payable by 10% Income taxes Payable $ 165.00 $ 165.00 Total Current Liabilities $ 8,756.00 $ 7,943.30 Long-Term Debt Obligations $ 7,400.00 $ 7,400.00 Other Liabilities $ 5,591.00 $ 5,591.00 Deferred Income Taxes $ 659.00 $ 659.00 Total Liabilities $ 22,406.00 $ 21,593.30 Commitments and Contigencies Preferred Stock, no par value $ 41.00 $ 41.00 Repurchased Preferred Stock $ (145.00) $ (300.00) PepsiCo Common Shareholders' Equity Common stock, par value 1 2/3 cents per share (authorized 3,600 shares, issued 1,782 shares) $ 30.00 $ 30.00 Capital in excess of par value $ 250.00 $ 250.00 Retained earnings $ 33,805.00 $ 39,980.73 Based on Income Statement - $31 million for purchasing of new brands and environmental group Accumulated other comprehensive loss $ (3,794.00) $ (4,500.00) Repurchased common stock, at cost (217 and 229 shares,respectively) $ (13,383.00) $ (13,383.00) Total PepsiCo Common Shareholders' Equity $ 16,908.00 $ 22,118.73 Noncontrolling interests $ 638.00 $ 575.00 Total Equity $ 17,442.00 $ 22,693.73 Total Liabilities and Equity $ 39,848.00 $ 44,287.03
Evaluation
Balanced Area of Objectives Customers Measure of Target Costumer Survey Time Expectation Primary Responsibility Scorecard 1. Customer satisfaction Quarterly Human Resources Webinars Representatives 1. Improve production Increase in Supply chain Biannually efficiency production Operations Employee surveys 2. Offer employee trainings Yearly Human Resources Production efficiency Community/ Social Responsibility Increase in recyclable bottle Being involve in 1. Eco-Friendly company Yearly CEO more events regarding water contamination Number and success of charitable events 2. Ethical Company Yearly CEO UNICEF amount of money donated Operations/Processes New products Product appearance CEO 1. Innovation Yearly Acquisition of new brands Numbers of new countries entered Number of sales in 2. Brand expansion Yearly CEO the International Segment Financial 1. Reduce cost of Income Statement Quarterly Chief Financial Officer production Increase annual 2. Increase profitability Quarterly Chief Financial Officer report
Future Ratios 2009 Projected 2010 Liquidity Ratios Current Ratio 1.44 1.85 Quick Ratio 1.14 1.41 Leverage Ratios Debt-to-Total Assets Ratio 0.56 0.5 Debt-to-equity Ratio 1.33 0.97 Long-term debt-to-equity 0.44 0.33 Ratio Times-Interest-earned Ratio -17.1 -21.01 Activity Ratios Inventory Turns 16.5 12.97 Fixed Assets Turnover 3.41 3.26 Total Assets Turnover 1.08 1.02 Profitability Ratios Gross Profit margins 0.54 0.57 Operating Profit Margin 0.19 0.21 Net Profit Margin 0.14 0.19 Return on Total Assets 0.15 0.16 Return on Stockholders equity 0.35 0.36 Earning per share 3.36 3.43 Price-earnings Ratio 8.94 8.74 Growth Rations (yearly) Sales -0.04% 5.00% Net Income 15.74% 4.36% Earnings per share -0.27% 15.79%
Fun Facts
Pepsi/Coke Rivalry ∗ http://www.buzzfeed.com/pepsi/the-10-most-iconic-pepsi-com
Questions?
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