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59
Latin America Foods
% Change
2014 2013 2012 2014 2013
Net revenue $ 8,442 $ 8,350 $ 7,780 17
Impact of foreign exchange translation 86
Net revenue growth, on a constant currency
basis(a) 10 (b) 13
Operating profit $ 1,211 $ 1,242 $ 1,059 (2.5) 17
Restructuring and impairment charges 25 12 50
Operating profit excluding above item(a) $ 1,236 $ 1,254 $ 1,109 (1.5) 13
Impact of foreign exchange translation 11 5
Operating profit growth excluding above item,
on a constant currency basis(a) 9(b) 18
(a) See “Non-GAAP Measures.”
(b) Does not sum due to rounding.
2014
Net revenue increased 1%, primarily reflecting favorable effective net pricing, including 7 percentage points
related to inflation-based pricing in Venezuela, partially offset by volume declines. Unfavorable foreign
exchange reduced net revenue growth by 8 percentage points.
Volume declined 2%, reflecting a mid-single-digit decline in Mexico due to a tax on certain packaged foods,
which became effective during the first quarter of 2014. Additionally, Brazil experienced a low-single-digit
decline.
Operating profit declined 2.5%, reflecting certain operating cost increases including strategic initiatives.
Additionally, higher commodity costs, led by Venezuela, primarily reflecting packaging and potato inflation,
negatively impacted operating profit performance by 27 percentage points. These increases in costs were
partially offset by the revenue growth and planned cost reductions across a number of expense categories.
Unfavorable foreign exchange negatively impacted operating profit performance by 11 percentage points,
including a 6-percentage-point impact from Venezuela. Reported operating profit performance included a
contribution of 6 percentage points from the results of our Venezuela business. For additional information
on Venezuela, see “Market Risks” in “Our Business Risks.”
2013
Net revenue increased 7%, primarily reflecting favorable effective net pricing. Unfavorable foreign exchange
reduced net revenue growth by 6 percentage points.
Volume increased 2%, reflecting a mid-single-digit increase in Brazil and low-single-digit growth in Mexico.
Operating profit increased 17%, reflecting the net revenue growth and planned cost reductions across a
number of expense categories, partially offset by certain operating cost increases and higher advertising and
marketing expenses, as well as higher commodity costs, which reduced operating profit growth by 15
percentage points. Lower restructuring and impairment charges increased operating profit growth by 4
percentage points. Unfavorable foreign exchange reduced operating profit growth by 5 percentage points.