Pepsi 2006 Annual Report Download - page 30

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We are a leading global snack and
beverage company. We manufacture,
market and sell a variety of salty, conve-
nient, sweet and grain-based snacks,
carbonated and non-carbonated bever-
ages and foods. We are organized into
four divisions:
Our North American divisions oper-
ate in the United States and Canada.
Our international division operates in
approximately 200 countries, with our
largest operations in Mexico and the
United Kingdom. Additional informa-
tion concerning our divisions and
geographic areas is presented in Note 1.
Frito-Lay North America
Frito-Lay North America (FLNA) manu-
factures or uses contract manufacturers,
markets, sells and distributes branded
snacks. These snacks include Lay’s
potato chips, Doritos tortilla chips,
Tostitos tortilla chips, Cheetos cheese
flavored snacks, Fritos corn chips,
branded dips, Ruffles potato chips,
Quaker Chewy granola bars, SunChips
multigrain snacks, Rold Gold pretzels,
Santitas tortilla chips, Frito-Lay nuts,
Grandma's cookies, Munchies snack
mix, Gamesa cookies, Lay’s Stax potato
crisps, Funyuns onion flavored rings,
Quaker Quakes corn and rice snacks,
Miss Vickie’s potato chips, branded
crackers, Quaker snack mix, Smartfood
popcorn, Chester’s fries, Stacy’s pita
chips and Quaker Fruit & Oatmeal bars.
FLNA branded products are sold to
independent distributors and retailers.
PepsiCo Beverages North America
PepsiCo Beverages North America
(PBNA) manufactures or uses contract
manufacturers, mar-
kets and sells
beverage
concentrates, foun-
tain syrups and
finished goods,
under various bever-
age brands including
Pepsi, Mountain
Dew, Gatorade,
Tropicana Pure Premium, Lipton, Sierra
Mist, Tropicana juice drinks, Propel,
Dole and SoBe. PBNA also manufactures
or uses contract manufacturers, markets
and sells ready-to-drink tea, coffee and
water products through joint ventures
with Unilever (under the Lipton brand
name) and Starbucks. In addition, PBNA
licenses the Aquafina water brand to its
bottlers and markets this brand. PBNA
sells concentrate and finished goods for
some of these brands to authorized
bottlers, and some of these branded
products are sold directly by us to inde-
pendent distributors and retailers. The
bottlers sell our brands as finished
goods to independent distributors and
retailers. PBNA’s volume reflects sales to
its independent distributors and retail-
ers, as well as the sales of beverages
bearing our trademarks that bottlers
have reported as sold to independent
distributors and retailers.
PepsiCo International
PepsiCo International (PI) manufactures
through consolidated businesses as well
as through noncontrolled affiliates, a
number of leading salty and sweet snack
brands including Lay’s, Walkers,
Cheetos, Doritos, Ruffles, Gamesa and
Sabritas. Further, PI manufactures or
uses contract manufacturers, markets
and sells many Quaker brand snacks. PI
also manufactures, markets and sells
beverage concentrates, fountain syrups
and finished goods under the brands
Pepsi, 7UP, Mirinda, Gatorade, Tropicana
and Mountain Dew. These brands are
sold to authorized bottlers, independent
distributors and retailers. However, in
certain markets, PI operates its own bot-
tling plants and distribution facilities. PI
also licenses the Aquafina water brand
to certain of its authorized bottlers. PI
reports two measures of volume. Snack
volume is reported on a system-wide
basis, which includes our own volume
and the volume sold by our
noncontrolled affiliates. Beverage
volume reflects Company-owned and
authorized bottler sales of beverages
bearing our trademarks to independent
distributors and retailers.
Quaker Foods North America
Quaker Foods North America (QFNA)
manufactures or uses contract manufac-
turers, markets and sells cereals, rice,
pasta and other branded products.
QFNA’s products include Quaker
oatmeal, Aunt Jemima mixes and
syrups, Cap’n Crunch cereal, Quaker
grits, Life cereal, Rice-A-Roni, Pasta Roni
and Near East side dishes. These
branded products are sold to indepen-
dent distributors and retailers.
Our Business
Our discussion and analysis is an integral part of understanding our financial results. Definitions of key terms
can be found in the glossary on page 82. Tabular dollars are presented in millions, except per share amounts.
All per share amounts reflect common per share amounts, assume dilution unless noted, and are based on
unrounded amounts. Percentage changes are based on unrounded amounts.
Our Operations
28
Our Divisions
• Frito-Lay North America (FLNA)
• PepsiCo Beverages North America (PBNA)
• PepsiCo International (PI)
• Quaker Foods North America (QFNA)
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