01—Abstract
Summary
Summary of the 10-K filed February 14, 2014. Cited figures are marked; the original filing is the authoritative source.
PepsiCo's 2013 10-K filing highlights a year of continued strategic investment in its core brands and innovation, alongside a robust productivity program that yielded over $900 milliona in savings.
The company demonstrated resilience, with net income attributable to PepsiCo increasing by 9% and diluted EPS growing by 10%. Key initiatives included expanding its portfolio of more nutritious products, enhancing digital capabilities, and strengthening its global supply chain to address geopolitical and social instability. The company also returned $6.4 billionb to shareholders through share repurchases and dividends, signaling a commitment to shareholder value.
Looking ahead, PepsiCo outlined a strategy focused on continued investment in developing and emerging markets, broadening its product portfolio with healthier options, further developing digital tools, protecting its supply chain, and managing commodity volatility. The company's 'Performance with Purpose' goal remains central, emphasizing sustained value creation through a diverse product range, environmental responsibility, employee well-being, and community investment.
02—Key points
Key Highlights
- Net income attributable to PepsiCo increased by 9% to $6.74 billion, with diluted EPS growing 10% to $4.32.
- The company executed a multi-year productivity program that generated over $900 million in savings during 2013.
- PepsiCo returned $6.4 billion to shareholders in 2013 through dividends ($3.4 billion) and share repurchases ($3.0 billion).
- Strategic investments were made in key global brands and innovation, including the launch of Mountain Dew Kickstart and the opening of a new innovation center in Shanghai.
- The company is focusing on expanding its portfolio of more nutritious products and reducing sodium, added sugars, and saturated fat in select brands.
- Significant investments were planned for developing and emerging markets to capitalize on growth opportunities.
- Foreign exchange headwinds impacted net revenue and operating profit, with unfavorable movements particularly noted in Venezuela, Brazil, Egypt, and Russia.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2013, Pepsico Inc kept $0.10.
- Revenue$66.42B100.0%
- Cost of revenue−$31.24B47.0%
- Gross profit$35.17B53.0%
- Operating costs−$25.47B38.3%
- Operating income$9.71B14.6%
- Interest, other & tax−$2.96B4.5%
- Net income$6.74B10.1%
Where FY2013 revenue went
$66.42B- Cost of revenue: $31.24B, 47% of revenue
- SG&A: $25.36B, 38% of revenue
- Net income: $6.74B, 10% of revenue
- R&D: $665.0M, 1.0% of revenue
- Interest, other & tax: $2.96B, 4.5% of revenue
Kept 10% as net incomeNet income $6.74B · 10%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2013filed February 14, 2014Financial Statements
FY2013 against FY2012
| Line item | FY2013FY2012 | Change |
|---|---|---|
| Revenue | $66.42B$65.49B | +1.4% |
| Cost of Revenue | $31.24B$31.29B | −0.2% |
| Gross Profit | $35.17B$34.20B | +2.8% |
| R&D Expenses | $665.00M$552.00M | +20.5% |
| SG&A Expenses | $25.36B$24.97B | +1.5% |
| Operating Income | $9.71B$9.11B | +6.5% |
| Interest Expense | $911.00M$899.00M | +1.3% |
| Net Income | $6.74B$6.18B | +9.1% |
| EPS (Basic) | $4.37$3.96 | +10.4% |
| EPS (Diluted) | $4.32$3.92 | +10.2% |
| Shares Outstanding (Basic) | 1.54B1.56B | −1.0% |
| Shares Outstanding (Diluted) | 1.56B1.57B | −1.0% |
05—Questions
Frequently Asked Questions
What were PepsiCo's primary financial performance drivers in 2013?
PepsiCo's 2013 financial performance was driven by effective net pricing, planned cost reductions across various expense categories, and the benefits of its productivity initiatives, which contributed over $900 million in savings. These positive factors were partially offset by strategic investments in capacity and capability, higher advertising and marketing expenses, and increased commodity costs.
How did PepsiCo address consumer trends towards healthier options?
PepsiCo continued to broaden its product portfolio, with a focus on more nutritious offerings. This included efforts to reduce added sugar, sodium, and saturated fat in certain key brands, and an investment in research and development aimed at developing healthier, convenient foods and beverages. The company also noted the ongoing consumer shift towards healthier snacking and convenient, functional nutrition.
What is PepsiCo's strategy for growth in international markets, particularly in developing and emerging economies?
PepsiCo views developing and emerging markets as attractive high-growth spaces and plans to continue making significant investments in these regions. This includes developing the necessary skills, tools, and people to compete effectively. The company has a strong presence in these markets and sees opportunities for further growth by offering products that meet local consumer preferences and needs.
What is PepsiCo's approach to returning capital to shareholders?
In 2013, PepsiCo returned $6.4 billion to shareholders through a combination of dividends ($3.4 billion) and share repurchases ($3.0 billion). The company also announced a 15% increase in its annualized dividend and a new $10 billion share repurchase program authorized in the first quarter of 2013, demonstrating a commitment to enhancing shareholder value.
06—Continue