Snapple 2012 Annual Report Download - page 44

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Year Ended December 31, 2012 Compared to Year Ended December 31, 2011
Consolidated Operations
The following table sets forth our consolidated results of operations for the years ended December 31, 2012 and 2011 (dollars
in millions, except per share data):
For the Year Ended December 31,
2012 2011 Percentage
Dollars Percent Dollars Percent Change
Net sales $ 5,995 100.0% $ 5,903 100.0% 2%
Cost of sales 2,500 41.7 2,485 42.1
Gross profit 3,495 58.3 3,418 57.9 2
Selling, general and administrative expenses 2,268 37.8 2,257 38.3
Depreciation and amortization 124 2.1 126 2.1
Other operating expense, net 11 0.2 11 0.2
Income from operations 1,092 18.2 1,024 17.3 7
Interest expense 125 2.1 114 1.9
Interest income (2) — (3)(0.1)
Other income, net (9) (0.2) (12)(0.2)
Income before provision for income taxes and equity in
earnings of unconsolidated subsidiaries 978 16.3 925 15.7 6
Provision for income taxes 349 5.8 320 5.5
Income before equity in earnings of unconsolidated
subsidiaries 629 10.5 605 10.2
Equity in earnings of unconsolidated subsidiaries, net of tax — — 1 —
Net income $ 629 10.5% $ 606 10.3% 4%
Earnings per common share:
Basic $ 2.99 NM $ 2.77 NM 8%
Diluted $ 2.96 NM $ 2.74 NM 8%
Volume (BCS). Volume (BCS) decreased 1% for the year ended December 31, 2012, compared with the year ended December
31, 2011. In the U.S. and Canada, volume declined 1%, and in Mexico and the Caribbean, volume increased 2%, in each case
compared with the year ago period. CSD volume was flat, while NCB volume decreased 5%. In CSDs, Dr Pepper volume was
flat due to the growth of Dr Pepper TEN, which launched in the fourth quarter of 2011, and the impact of additional fountain
availability. These increases were offset by declines in Cherry and diet Dr Pepper. Canada Dry, 7UP, A&W and Sunkist soda, Sun
Drop (our "Core 5 brands") brands were flat compared to the year ago period as a mid single-digit increase in Canada Dry was
offset by a double-digit decrease in Sun Drop due to cycling the national launch of the brand in the prior year, and low single-
digit declines in 7UP and Sunkist soda. Peñafiel increased 5% as a result of package innovation. Schweppes grew 5% reflecting
growth in the ginger ale category. Squirt increased 1% while Crush decreased 4%. Our other CSD brands decreased 3% for the
year ended December 31, 2012, led by Welch's. Decreases in NCBs were driven by a 17% decrease in Hawaiian Punch as a result
of price increases and a 7% decrease in Mott's due to net price increases and lower promotional activity. These decreases were
partially offset by a 15% increase in Clamato, a 3% increase in Snapple as a result of package and flavor innovation and a 2%
increase in our water category. Our water category was led by strong performances by Vita Coco, Deja Blue and FIJI in our
Packaged Beverages segment, partially offset by declines in Aguafiel as a result of lower promotional activity in our Latin America
Beverages segment.
Net Sales. Net sales increased $92 million, or approximately 2%, for the year ended December 31, 2012, compared with the
year ended December 31, 2011. The increase was attributable to price increases and favorable mix. These drivers were partially
offset by lower sales volumes and the unfavorable impact of foreign currency.