Pepsi 2015 Annual Report Download - page 75
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Table of Contents
58
benefit of actions associated with our productivity initiatives, which contributed more than $1 billion in cost
reductions across a number of expense categories throughout all of our segments. Additionally, the impact
of certain charges associated with productivity initiatives outside the scope of the 2014 and 2012 Productivity
Plans negatively impacted operating profit performance by nearly 1 percentage point, primarily in the ESSA
and AMENA segments. Other corporate unallocated expenses decreased 8%, primarily reflecting decreased
pension expense, as well as the lapping of incremental investments into our business in the prior year, partially
offset by higher foreign exchange transaction losses. Items affecting comparability (see “Items Affecting
Comparability”) negatively impacted total operating profit performance by 3.8 percentage points and total
operating margin by 0.6 percentage points.
Other Consolidated Results
Change
2015 2014 2013 2015 2014
Interest expense, net $ (911) $ (824) $ (814) $ (87) $ (10)
Annual tax rate 26.1% 25.1% 23.7%
Net income attributable to PepsiCo $ 5,452 $ 6,513 $ 6,740 (16 )% (3)%
Net income attributable to PepsiCo per common
share – diluted $ 3.67 $ 4.27 $ 4.32 (14 )% (1)%
Mark-to-market net (gains)/losses —0.03 0.03
Restructuring and impairment charges 0.12 0.21 0.08
Pension-related settlement (benefits)/charge (0.03) 0.06 —
Charge related to the transaction with Tingyi 0.05 ——
Venezuela impairment charges 0.91 ——
Venezuela remeasurement charges —0.07 0.07
Merger and integration charges —— 0.01
Tax benefits (0.15) — (0.13)
Net income attributable to PepsiCo per common
share – diluted, excluding above items (a) $ 4.57 $ 4.63 (b) $ 4.37 (b) (1)% 6%
Impact of foreign exchange translation 11 3
Growth in net income attributable to PepsiCo per
common share – diluted, excluding above items,
on a constant currency basis (a) 10 % 9%
(a) See “Non-GAAP Measures.”
(b) Does not sum due to rounding.
2015
Net interest expense increased $87 million, reflecting higher rates on our debt balances and lower gains on
the market value of investments used to economically hedge a portion of our deferred compensation costs.
The reported tax rate increased 1.0 percentage point reflecting the impact of the Venezuela impairment
charges, which had no accompanying tax benefit, partially offset by the favorable resolution with the IRS
of substantially all open matters related to the audits for taxable years 2010 and 2011.
Net income attributable to PepsiCo decreased 16% and net income attributable to PepsiCo per common share
decreased 14%. Items affecting comparability (see “Items Affecting Comparability”) negatively impacted
net income attributable to PepsiCo by 12 percentage points and net income attributable to PepsiCo per
common share by 13 percentage points.