Snapple 2012 Annual Report Download - page 53

Download and view the complete annual report

Please find page 53 of the 2012 Snapple annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 135

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135

35
LATIN AMERICA BEVERAGES
The following table details our Latin America Beverages segment's net sales and SOP for the year ended December 31, 2011
and 2010 (in millions):
For the Year Ended
December 31,
2011 2010 Change
Net sales $ 418 $ 382 $ 36
SOP 43 40 3
Volume. Sales volume increased 4% for the year ended December 31, 2011, as compared with the year ended December 31,
2010. The increase in volume was driven by a 7% increase in Squirt volume due to higher sales to third party bottlers, a 5% increase
in Peñafiel and a 26% increase in Clamato due to targeted marketing programs and distribution gains. These volume increases
were partially offset by a 18% decrease in Crush volume driven by price increases.
Net Sales. Net sales increased 9% for the year ended December 31, 2011, compared with year ended December 31, 2010,
primarily due to favorable product mix, increases in sales volume and price increases. The favorable impact of $7 million in foreign
currency changes was partially offset by the $6 million reclassification of certain transportation allowances to our customers from
selling, general and administrative expenses to net sales.
SOP. SOP increased 8% for the year ended December 31, 2011, compared with year ended December 31, 2010, primarily
due to the increase in net sales partially offset by higher costs for packaging materials, sweeteners and other commodities. This
increase was further reduced by the unfavorable impact of changes in foreign currency on our expenses, increased logistic costs,
higher depreciation expense and higher compensation costs.
LIQUIDITY AND CAPITAL RESOURCES
Trends and Uncertainties Affecting Liquidity
Customer and consumer demand for the Company's products may be impacted by various risk factors discussed in Item 1A,
"Risk Factors", including recession or other economic downturn in the U.S., Canada, Mexico or the Caribbean, which could result
in a reduction in our sales volume. Similarly, disruptions in financial and credit markets may impact the Company's ability to
manage normal commercial relationships with its customers, suppliers and creditors. These disruptions could have a negative
impact on the ability of our customers to timely pay their obligations to us, thus reducing our cash flow, or the ability of our vendors
to timely supply materials.
We believe that the following trends and uncertainties may also impact liquidity:
• continued capital expenditures to upgrade our existing plants and fleet of distribution trucks, replace and expand our
cold drink equipment and make investments in IT systems;
• continued payment of dividends;
• seasonality of our operating cash flows could impact short-term liquidity;
• our continued repurchases of our outstanding common stock pursuant to our repurchase programs;
• acquisitions of regional bottling companies, distributors and distribution rights to further extend our geographic
coverage;
• our ability to issue unsecured commercial paper notes (the "Commercial Paper") on a private placement basis up to
a maximum aggregate amount outstanding at any time of $500 million; and
• our ability to refinance $250 million of our outstanding 6.12% senior notes due May 1, 2013 (the "2013 Notes").
We intend to issue Commercial Paper or senior notes to refinance the 2013 Notes during the second quarter of 2013.