Pepsi 2012 Annual Report Download - page 67

19percentage points to the reported operating profit growth
and reflected net charges of $56million included in items
affecting comparability in the above table (see “Items Affecting
Comparability”). Excluding the items affecting comparability,
operating profit increased 18%. Favorable foreign exchange
contributed 4percentage points to operating profit growth.
Asia, Middle East and Africa
% Change
2012 2011 2010 2012 2011
Net revenue $ 6,653 $ 7,392 $ 6,291 (10) 17
Impact of foreign exchange translation 3 (2)
Net revenue growth, on a constant currency basis* (7) 16**
Operating profit $ 747 $ 887 $ 708 (16) 25
Restructuring and impairment charges 28 9 –
Restructuring and other charges related to the transaction with Tingyi 150 – –
Operating profit excluding above items* $ 925 $ 896 $ 708 3 27
Impact of foreign exchange translation 1 (2.5)
Operating profit growth excluding above items, on a constant currency basis* 4 24**
* See “Non-GAAP Measures”
** Does not sum due to rounding
2012
Net revenue declined 10%, reflecting the impact of the trans-
action with Tingyi and the deconsolidation of International
Dairy and Juice Limited (IDJ), which reduced net revenue per-
formance by 15percentage points and 2percentage points,
respectively, partially offset by volume growth and effective
net pricing. Unfavorable foreign exchange negatively impacted
net revenue performance by nearly 3percentage points.
Snacks volume grew 14%, reflecting broad-based increases,
which included double-digit growth in the Middle East, India
and China. Additionally, Australia experienced low-single-
digit growth.
Beverage volume grew 10%, driven by double-digit growth
in India and Pakistan and high-single-digit growth in the
Middle East as well as in China, which included the benefit
of new co-branded juice products distributed through our
joint venture with Tingyi. The Tingyi co-branded volume had
a 4- percentage-point impact on AMEA’s reported bever-
age volume. Excluding the benefit of the Tingyi co-branded
volume, beverage volume in China declined high-single digits
due to Tingyi’s transitional impact on AMEA’s legacy juice busi-
ness, the introduction of a 500ml PET value package in the
third quarter of 2011, which largely replaced our 600ml offer-
ing in the market, and the timing of the New Year’s holiday.
Operating profit declined 16%, driven by the items affect-
ing comparability in the above table (see “Items Affecting
Comparability”). Excluding these items affecting compara-
bility, operating profit increased 3%, reflecting the volume
growth and effective net pricing, partially offset by higher
commodity costs, which negatively impacted operating profit
performance by 10 percentage points. Excluding the restruc-
turing and other charges related to the transaction with
Tingyi listed in the above items affecting comparability, the
net impact of acquisitions and divestitures reduced reported
operating profit by 2percentage points, primarily as a resultof
a one-time gain in the prior year associated with the sale
ofour investment in our franchise bottler in Thailand, which
negatively impacted reported operating profit performance by
13percentage points. This decline was partially offset by the
impact of structural changes related to the transaction with
Tingyi, which positively contributed 11percentage points to
reported operating profit performance. Unfavorable foreign
exchange reduced reported operating profit performance by
1percentage point.
2011
Net revenue grew 17%, reflecting volume growth and favor-
able effective net pricing. Foreign exchange contributed
2percentage points to net revenue growth. Acquisitions had a
nominal impact on net revenue growth.
Snacks volume grew 15%, reflecting broad-based increases
driven by double-digit growth in India, China and the
Middle East.
Beverage volume grew 5%, driven by double-digit growth in
India and mid-single-digit growth in China and the Middle East.
Acquisitions had a nominal impact on the beverage volume
growth rate.
Operating profit grew 25%, driven primarily by the net
revenue growth, partially offset by higher commodity costs.
Acquisitions and divestitures increased operating profit
growth by 16percentage points, primarily as a result of a one-
time gain associated with the sale of our investment in our
franchise bottler in Thailand. Favorable foreign exchange con-
tributed 2.5percentage points to the operating profit growth.
Management’s Discussion and Analysis
2012 PEPSICO ANNUAL REPORT 65