Snapple 2009 Annual Report Download - page 51
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Other income of $22 million in 2009 includes $6 million related to indemnity income associated with the Tax
Sharing and Indemnification Agreement (“Tax Indemnity Agreement”) with Cadbury and an additional $16 million
of one-time separation related items resulting from an audit settlement during the third quarter of 2009.
Provision for Income Taxes
The effective tax rates for 2009 and 2008 were 36.3% and 16.3%, respectively. The 2009 tax rate is higher than
2008 primarily because the 2008 tax rate reflects that the tax benefit provided on the 2008 impairment charge is at
an effective rate lower than our statutory rate primarily due to limits on the tax benefit provided against goodwill.
However, the 2009 tax rate also includes a reduced level of nonrecurring separation related costs, benefits due to tax
planning, and decreased state tax rates which reduced our deferred tax liabilities. These benefits were partly offset
by additional tax expense related to a change in Mexican tax law enacted in the fourth quarter.
Results of Operations by Segment
We report our business in three segments: Beverage Concentrates, Packaged Beverages and Latin America
Beverages. The key financial measures management uses to assess the performance of our segments are net sales
and SOP. The following tables set forth net sales and SOP for our segments for 2009 and 2008, as well as the
adjustments necessary to reconcile our total segment results to our consolidated results presented in accordance
with U.S. GAAP (dollars in millions).
2009 2008
For the Year Ended
December 31,
Net sales
Beverage Concentrates ........................................ $ 1,063 $ 983
Packaged Beverages .......................................... 4,111 4,305
Latin America Beverages....................................... 357 422
Net sales ................................................. $ 5,531 $ 5,710
2009 2008
For the Year Ended
December 31,
SOP
Beverage Concentrates ........................................ $ 683 $ 622
Packaged Beverages .......................................... 573 483
Latin America Beverages....................................... 54 86
Total SOP .............................................. 1,310 1,191
Unallocated corporate costs . . ................................... 265 259
Impairment of goodwill and intangible assets ........................ — 1,039
Restructuring costs ........................................... — 57
Other operating (income) expense ................................ (40) 4
Income (loss) from operations .................................... 1,085 (168)
Interest expense, net ........................................ (239) (225)
Other income, net .......................................... 22 18
Income (loss) before provision for income taxes and equity in earnings of
unconsolidated subsidiaries .................................... $ 868 $ (375)
31