Snapple 2014 Annual Report Download - page 69

Download and view the complete annual report

Please find page 69 of the 2014 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 126

  • 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

DR PEPPER SNAPPLE GROUP, INC.
NOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Continued)
66
6. Investments in Unconsolidated Subsidiaries
The Company has an investment in a 50% owned Mexican joint venture with Acqua Minerale San Benedetto which gives it
the ability to exercise significant influence over operating and financial policies of the investee. The joint venture is not a variable
interest entity and the investment represents a noncontrolling ownership interest and is accounted for under the equity method of
accounting. The carrying value of the investment was $13 million and $14 million as of December 31, 2014 and 2013, respectively.
The Company also has a 40.4% investment in Hydrive Energy, LLC ("Hydrive"). On November 16, 2012, Hydrive sold its
intellectual property rights to Big Red Holdings, Inc. in exchange for earn-out payments to Hydrive based on the earnings associated
with Hydrive functional beverages over the next fifteen years. The carrying value of the investment was $1 million as of
December 31, 2014 and 2013.
The Company's equity investments do not have a readily determinable fair value as the entities are not publicly traded. The
Company's proportionate share of the net income (loss) resulting from these investments are reported under the line item captioned
equity in earnings of unconsolidated subsidiaries, net of tax, in the Consolidated Statements of Income.
Additionally, the Company maintains an investment accounted for under the cost method of accounting. This investment has
a zero cost basis and is not within the Company's control nor does the Company have the ability to exercise significant influence
over operating and financial policies. This cost method investment does not have a readily determinable fair value as the entity is
not publicly traded.
7. Goodwill and Other Intangible Assets
Changes in the carrying amount of goodwill for the years ended December 31, 2014 and 2013, by reporting unit, are as follows
(in millions):
Beverage
Concentrates WD Reporting
Unit(1)
DSD
Reporting
Unit(1) Latin America
Beverages Total
Balance as of January 1, 2013
Goodwill $ 1,732 $ 1,220 $ 180 $ 31 $ 3,163
Accumulated impairment losses — — (180) — (180)
1,732 1,220 — 31 2,983
Acquisition activity (2) — — 5—5
Balance as of December 31, 2013
Goodwill 1,732 1,220 185 31 3,168
Accumulated impairment losses — — (180) — (180)
1,732 1,220 5 31 2,988
Foreign currency impact ———(3)(3)
Acquisition activity (3) — 2 3 — 5
Balance as of December 31, 2014
Goodwill 1,732 1,222 188 28 3,170
Accumulated impairment losses — — (180) — (180)
$ 1,732 $ 1,222 $ 8 $ 28 $ 2,990
____________________________
(1) The Packaged Beverages segment is comprised of two reporting units, the Direct Store Delivery ("DSD") system and the
Warehouse Direct ("WD") system.
(2) The acquisition activity represents the goodwill associated with the purchase of DP/7UP West. See Note 3 for further
information related to the acquisition.
(3) The acquisition activity represents the goodwill associated with the purchase of Davis. See Note 3 for further information
related to the acquisition.