PepsiCo Reports First Quarter 2014 Results

                  PepsiCo Reports First Quarter 2014 Results

-- Core1 EPS increased 7 percent to $0.83. Core constant currency1 EPS
increased 10 percent. Reported EPS increased 15 percent to $0.79

-- Organic1 revenue grew 4.0 percent in the quarter. Reported net revenue was
even versus the prior-year quarter, reflecting the impacts of foreign exchange
translation and structural changes

-- Core constant currency operating profit increased 7 percent. Reported
operating profit increased 9 percent.

-- Company expects to return approximately $8.7 billion to shareholders
through dividends and share repurchases in 2014, a 35 percent year-over-year
increase

-- Company reaffirms 7 percent core constant currency EPS growth target for
2014

-- On track to deliver approximately $1 billion in annual productivity savings
in 2014

PR Newswire

PURCHASE, N.Y., April 17, 2014







PURCHASE, N.Y., April 17, 2014 /PRNewswire/ --PepsiCo, Inc. (NYSE: PEP) today
reported core earnings per share of $0.83 for the first quarter, an increase
of 7 percent. Core constant currency EPS increased 10 percent on organic
revenue growth of 4.0 percent.

PepsiCo logo

"We're pleased with our performance in the first quarter of 2014. PepsiCo
delivered mid-single-digit organic revenue growth and double-digit core
constant currency earnings per share growth, despite ongoing macroeconomic
volatility, political instability and other challenging marketplace conditions
in a number of our key markets," said Chairman and CEO Indra Nooyi.

"We continue to perform well, in part, because we have strong, balanced
portfolios of brands, products and geographies that enable us to capture
growth opportunities across multiple demand spaces while we responsibly
manage through the volatility and challenges in other parts of the business.

"We're also benefiting from the investments we've recently made to strengthen
our brands, innovate more effectively, and drive better execution; all while
operating more efficiently by leveraging our global scale and capabilities.

"We remain confident in achieving our financial goals for the full year and
believe that we have the right strategies in place to create long-term value
for our shareholders."

^1Please refer to the Glossary for the definitions of Non-GAAP financial
measures including core, constant currency, organic and free cash flow.

Summary First Quarter 2014 Performance (Percent Growth)
                    Reported  Core Constant  Organic^b
                              Currency^a
Volume
Snacks              2                        2
Beverages           —                        —
Net Revenue         —                        4
Operating Profit^c  9         7
EPS                 15        10



                                                      Core

                                                      Constant

                        Net Revenue                   Currency

                Organic              Operating Organic   Operating

                Volume^b             Profit^c  Revenue^b Profit^a
PAF             1        1           2         5         5
FLNA            3        3           4         4         6
LAF             (3)      (2)         7         9         13
QFNA            3        —           (11)      1         (9)
PAB             —        —           (24)      1         (3)
Europe          3/3^d    1           72        7         64
AMEA            4/(1)^d  (5)         5         6         10
Total Divisions 2/- ^ d  —           (2)       4         6
Total PepsiCo   2/- ^ d  —           9         4         7

^a Core constant currency results are non-GAAP financial measures that exclude
certain items affecting comparability. For more information about our core
constant currency results, see "Reconciliation of GAAP and Non-GAAP
Information" in the attached exhibits. Please refer to the Glossary for
definitions of "Core" and "Constant Currency".

^b Organic results are non-GAAP financial measures that adjust for impacts of
acquisitions, divestitures and other structural changes and foreign exchange
translation. For more information about our organic results, see
"Reconciliation of GAAP and Non-GAAP Information" in the attached exhibits.
Please refer to the Glossary for the definition of "Organic".

^c The reported operating profit performance was impacted by certain items
excluded from our core results in both 2014 and 2013. See "Reconciliation of
GAAP and Non-GAAP Information" in the attached exhibits for more information
about these items. Please refer to the Glossary for the definition of "Core".

^d ^ Snacks/Beverages.

Summary of First Quarter Financial Performance:

  oOrganic revenue grew 4.0 percent and reported net revenue was even versus
    the prior-year quarter. Structural changes negatively impacted reported
    net revenue performance by nearly half a percentage point and foreign
    exchange translation had a 3-percentage-point unfavorable impact in the
    quarter.
  oOrganic revenue grew 5 percent for global snacks and 3 percent for global
    beverages in the quarter. On a reported basis, revenue grew 1 percent for
    global snacks and declined 1 percent for global beverages, reflecting
    unfavorable foreign exchange translation and structural changes. Each
    operating segment had organic revenue growth in the quarter.
  oDeveloping and emerging market organic revenue grew 9 percent in the
    quarter. On a reported basis, developing and emerging market net revenue
    declined 2 percent in the quarter, reflecting structural changes and
    unfavorable foreign exchange translation.
  oCore gross margin expanded 40 basis points in the quarter reflecting
    implementation of effective revenue management strategies and productivity
    initiatives. Core operating margin expanded 50 basis points in the
    quarter. Reported gross margin increased 80 basis points and reported
    operating margin increased 110 basis points in the quarter.
  oCore constant currency operating profit increased 7 percent and included a
    $31 million one-time gain related to the sale of agricultural assets in
    Europe. Reported operating profit increased 9 percent and included the net
    impact of mark-to-market gains on commodity hedges, certain restructuring
    costs in 2014 and the lapping of the devaluation of net monetary assets in
    Venezuela in the prior-year quarter.
  oThe company's core effective tax rate was 23.7 percent and the reported
    effective tax rate was 24.1 percent, both below the prior-year quarter.
  oCore EPS was $0.83 and reported EPS was $0.79. Core EPS includes a $0.02
    impact from the one-time gain related to the sale of agricultural assets
    in Europe. Core EPS excludes a net impact of $0.01 per share related to
    mark-to-market net gains on commodity hedges and a $0.05 negative impact
    from restructuring charges. Mark-to-market net gains and losses on
    commodity hedges are subsequently reflected in core division results when
    the divisions recognize the cost of the underlying commodity in operating
    profit.
  oCash flow provided by operating activities was $181 million.
  oCompany is on track to deliver targeted $1 billion of productivity savings
    in 2014.
  oCompany expects to return a total of $8.7 billion to shareholders in 2014
    through approximately $5.0 billion in share repurchases and $3.7 billion
    in dividends.

Division Operating Summaries:

PepsiCo Americas Foods (PAF)

Organic revenue grew 5 percent in the quarter driven by 1 percentage point of
organic volume growth and 4 percentage points of effective net pricing. Each
division within PAF had organic revenue growth in the quarter. Reported net
revenue increased 1 percent, reflecting a 4-percentage-point unfavorable
impact from foreign exchange translation.

Core constant currency operating profit increased 5 percent, reflecting
organic revenue gains and productivity initiatives, partially offset by
increased advertising and marketing expense.

Frito-Lay North America (FLNA)

Organic revenue increased 4 percent in the quarter, reflecting a
3-percentage-point increase in organic volume and 1 percentage point of
effective net pricing. Reported net revenue increased 3 percent, reflecting a
1-percentage-point unfavorable foreign exchange translation impact.

Core constant currency operating profit grew 6 percent in the quarter,
reflecting organic revenue gains and productivity savings, partially offset by
operating cost inflation and a double-digit increase in advertising and
marketing expense.

Latin America Foods (LAF)

Organic revenue grew 9 percent in the quarter, reflecting 12 percentage points
of effective net pricing, partially offset by a 3 percent volume decline.
Reported net revenue declined 2 percent in the quarter, reflecting an
11-percentage-point unfavorable foreign exchange translation impact.

Organic revenue in Mexico declined low-single digits reflecting the adverse
impact of the enactment of taxes on certain food products. The balance of our
Latin America Foods business experienced double-digit organic revenue growth.
Reported net revenue declined mid-single-digits in Mexico and increased
low-single-digits in the balance of our Latin America Foods business, also
reflecting the impact of unfavorable foreign exchange translation.

Core constant currency operating profit increased 13 percent reflecting
organic revenue growth and productivity gains, partially offset by operating
cost and commodity cost inflation.

Quaker Foods North America (QFNA)

Organic revenue increased 1 percent in the quarter. Reported net revenue was
even versus the prior-year quarter, reflecting a 1-percentage-point
unfavorable foreign exchange translation impact. Core constant currency
operating profit declined 9 percent, reflecting the impact of oat supply
disruptions, unfavorable net pricing and operating cost inflation, partially
offset by productivity gains.

PepsiCo Americas Beverages (PAB)

Organic revenue increased 1 percent in the quarter, reflecting 1 percentage
point of effective net pricing and even organic volume. During the quarter,
PAB maintained its value market share position in the U.S. in measured
channels. Reported net revenue was even versus the prior-year quarter,
reflecting a 1-percentage-point impact from unfavorable foreign exchange
translation.

In North America, non-carbonated beverage volume grew 2 percent, and
carbonated soft drink volume declined 1 percent. Latin America beverage volume
decreased 1 percent driven by volume declines in Mexico related to the
enactment of taxes on certain beverage products.

Core constant currency operating profit declined 3 percent, reflecting
operating cost inflation and the adverse impact of the tax in Mexico,
partially offset by effective net pricing, productivity gains and adjustments
recognized through the company's share of the results of a joint venture.

Europe

Organic revenue grew 7 percent, reflecting balanced volume growth and
effective net pricing. Snacks and beverage volume each rose 3 percent.
Reported net revenue increased 1 percent, including a 6-percentage-point
unfavorable foreign exchange translation impact.

Core constant currency operating profit growth of 64 percent in the quarter
included a $31 million contribution from the one-time gain on the sale of
agricultural assets and reflects organic revenue growth and productivity
savings, partially offset by commodity cost and operating cost inflation.

Asia, Middle East & Africa (AMEA)

Organic revenue grew 6 percent in the quarter, lapping double-digit organic
growth in the prior-year quarter. Growth was driven by snacks volume growth
and effective net pricing. Reported net revenue declined 5 percent, reflecting
a 5-percentage-point negative impact from the refranchising of bottling
operations in Vietnam and a 5-percentage-point unfavorable impact from foreign
exchange translation.

Core constant currency operating profit increased 10 percent, reflecting
organic revenue growth and productivity gains, partially offset by operating
cost inflation.

2014 Guidance and Outlook:

Consistent with its previous guidance for 2014, the company expects 7 percent
core constant currency EPS growth versus its fiscal 2013 core EPS of $4.37.
Based on the current foreign exchange market consensus, the company currently
expects foreign exchange translation to have an unfavorable impact of
approximately 4 percentage points on full year core EPS growth in 2014.

Excluding the impact of structural changes and foreign exchange translation,
organic revenue in 2014is expected to grow mid-single digits versus 2013,
consistent with the company's long-term target. Based on the current foreign
exchange market consensus, the company currently expects foreign exchange
translation to have an unfavorable impact of approximately 3 percentage points
on full year net revenue growth in 2014.

For 2014, the company expects low-single-digit commodity inflation and
productivity savings of approximately $1 billion. The company expects higher
interest expense driven by increased debt balances and a core effective tax
rate of approximately 25 percent.

The company is targeting over $10 billion in cash flow from operating
activities and more than $7 billion in free cash flow (excluding certain
items) in 2014. Net capital spending is expected to be approximately $3
billion in 2014, within the company's long-term capital spending target of
less than or equal to 5 percent of net revenue.

The company expects to return a total of $8.7 billion to shareholders in 2014
through dividends of approximately $3.7 billion and share repurchases of
approximately $5.0 billion.

Conference Call:

At 8 a.m. (Eastern Time) today, the company will host a conference call with
investors and financial analysts to discuss first-quarter 2014 results and the
outlook for 2014. Further details, including a slide presentation accompanying
the call, will be accessible on the company's website at
www.pepsico.com/investors.

PepsiCo, Inc. and Subsidiaries
Condensed Consolidated Statement of Income
(in millions except per share amounts, and unaudited)
                                               12 Weeks Ended
                                               3/22/2014   3/23/2013   Change
Net Revenue                                    $  12,623   $  12,581   —     %
Cost of sales                                  5,747       5,834       (1.5) %
Selling, general and administrative expenses   5,048       5,066       —     %
Amortization of intangible assets              21          23          (9)   %
Operating Profit                               1,807       1,658       9     %
Interest expense                               (201)       (214)       (6)   %
Interest income and other                      10          27          (62)  %
Income before income taxes                     1,616       1,471       10    %
Provision for income taxes                     389         386         1     %
Net income                                     1,227       1,085       13    %
Less: Net income attributable to               11          10          10    %
noncontrolling interests
Net Income Attributable to PepsiCo             $  1,216    $  1,075    13    %
Diluted
Net Income Attributable to PepsiCo per Common  $  0.79     $  0.69     15    %
Share
Weighted-average common shares outstanding     1,540       1,563
Cash dividends declared per common share       $  0.5675   $  0.5375
A - 1



PepsiCo, Inc. and Subsidiaries
Supplemental Financial Information
(in millions, unaudited)
                                     12 Weeks Ended
                                     3/22/2014   3/23/2013   Change
Net Revenue
Frito-Lay North America              $  3,219    $  3,123    3    %
Quaker Foods North America           634         634         —    %
Latin America Foods                  1,338       1,367       (2)  %
PepsiCo Americas Foods               5,191       5,124       1    %
PepsiCo Americas Beverages           4,426       4,420       —    %
Europe                               1,961       1,942       1    %
Asia, Middle East & Africa           1,045       1,095       (5)  %
Total Net Revenue                    $  12,623   $  12,581   —    %
Operating Profit
Frito-Lay North America              $  862      $  828      4    %
Quaker Foods North America           160         180         (11) %
Latin America Foods                  232         216         7    %
PepsiCo Americas Foods               1,254       1,224       2    %
PepsiCo Americas Beverages           429         565         (24) %
Europe                               152         88          72   %
Asia, Middle East & Africa           194         184         5    %
Division Operating Profit            2,029       2,061       (2)  %
Corporate Unallocated
Commodity Mark-to-Market Net Impact  34          (16)
Restructuring and Impairment Charges 3           (1)
Venezuela Currency Devaluation       —           (124)
Other                                (259)       (262)
                                     (222)       (403)       (45) %
Total Operating Profit               $  1,807    $  1,658    9    %
A - 2



PepsiCo, Inc. and Subsidiaries

Condensed Consolidated Statement of Cash Flows

(in millions, unaudited)
                                                        12 Weeks Ended
                                                        3/22/2014   3/23/2013
Operating Activities
Net income                                              $  1,227    $  1,085
Depreciation and amortization                           532         551
Stock-based compensation expense                        72          77
Cash payments for merger and integration charges        —           (11)
Restructuring and impairment charges                    98          11
Cash payments for restructuring charges                 (25)        (30)
Non-cash foreign exchange loss related to Venezuela     —           111
devaluation
Excess tax benefits from share-based payment            (47)        (36)
arrangements
Pension and retiree medical plan expenses               119         149
Pension and retiree medical plan contributions          (84)        (87)
Deferred income taxes and other tax charges and credits 62          (23)
Change in accounts and notes receivable                 (358)       (175)
Change in inventories                                   (406)       (351)
Change in prepaid expenses and other current assets     (234)       (201)
Change in accounts payable and other current            (813)       (578)
liabilities
Change in income taxes payable                          175         244
Other, net                                              (137)       (34)
Net Cash Provided by Operating Activities               181         702
Investing Activities
Capital spending                                        (355)       (303)
Sales of property, plant and equipment                  7           8
Acquisitions and investments in noncontrolled           (24)        (30)
affiliates
Divestitures                                            85          —
Short-term investments, net                             59          40
Other investing, net                                    5           —
Net Cash Used for Investing Activities                  (223)       (285)
Financing Activities
Proceeds from issuances of long-term debt               1,990       2,491
Payments of long-term debt                              (1,652)     (1,190)
Short-term borrowings, net                              2,125       (153)
Cash dividends paid                                     (888)       (831)
Share repurchases – common                              (1,249)     (626)
Share repurchases – preferred                           (2)         (2)
Proceeds from exercises of stock options                171         449
Excess tax benefits from share-based payment            47          36
arrangements
Other financing                                         —           (1)
Net Cash Provided by Financing Activities               542         173
Effect of exchange rate changes on cash and cash        (36)        (172)
equivalents
Net Increase in Cash and Cash Equivalents               464         418
Cash and Cash Equivalents, Beginning of Year            9,375       6,297
Cash and Cash Equivalents, End of Period                $  9,839    $  6,715
A - 3



PepsiCo, Inc. and Subsidiaries

Condensed Consolidated Balance Sheet

(in millions except per share amounts)
                                                      3/22/2014    12/28/2013
                                                      (unaudited)
Assets
Current Assets
Cash and cash equivalents                             $   9,839    $  9,375
Short-term investments                                247          303
Accounts and notes receivable, net                    7,262        6,954
Inventories
Raw materials                                         1,794        1,732
Work-in-process                                       235          168
Finished goods                                        1,719        1,509
                                                      3,748        3,409
Prepaid expenses and other current assets             2,189        2,162
Total Current Assets                                  23,285       22,203
Property, plant and equipment, net                    18,129       18,575
Amortizable intangible assets, net                    1,593        1,638
Goodwill                                              16,310       16,613
Other nonamortizable intangible assets                14,053       14,401
Nonamortizable Intangible Assets                      30,363       31,014
Investments in noncontrolled affiliates               1,890        1,841
Other assets                                          2,233        2,207
Total Assets                                          $   77,493   $  77,478
Liabilities and Equity
Current Liabilities
Short-term obligations                                $   7,832    $  5,306
Accounts payable and other current liabilities        11,625       12,533
Total Current Liabilities                             19,457       17,839
Long-term debt obligations                            24,240       24,333
Other liabilities                                     4,811        4,931
Deferred income taxes                                 6,092        5,986
Total Liabilities                                     54,600       53,089
Commitments and Contingencies
Preferred stock, no par value                         41           41
Repurchased preferred stock                           (173)        (171)
PepsiCo Common Shareholders' Equity
Common stock, par value 1 ^2/[3 ]¢ per share
(authorized 3,600 shares, issued, net of repurchased  25           25
common stock at par value: 1,519 and 1,529 shares,
respectively)
Capital in excess of par value                        3,942        4,095
Retained earnings                                     46,770       46,420
Accumulated other comprehensive loss                  (5,940)      (5,127)
Repurchased common stock, in excess of par value (347 (21,892)     (21,004)
and 337 shares, respectively)
Total PepsiCo Common Shareholders' Equity             22,905       24,409
Noncontrolling interests                              120          110
Total Equity                                          22,893       24,389
Total Liabilities and Equity                          $   77,493   $  77,478
A - 4



PepsiCo, Inc. and Subsidiaries
Supplemental Share and Stock-Based Compensation Data
(in millions except dollar amounts, unaudited)
                                                      12 Weeks Ended
                                                      3/22/2014    3/23/2013
Beginning Net Shares Outstanding                      1,529        1,544
Options Exercised and Restricted Stock Units          5            10
Converted
Shares Repurchased                                    (15)         (9)
Ending Net Shares Outstanding                         1,519        1,545
Weighted Average Basic                                1,524        1,544
Dilutive Securities:
Options                                               9            10
Restricted Stock, PEPUnits and Other                  6            8
ESOP Convertible Preferred Stock                      1            1
Weighted Average Diluted                              1,540        1,563
Average Share Price for the Period                    $  81.09     $  73.67
Growth Versus Prior Year                              10        %  14        %
Options Outstanding                                   49           61
Options in the Money                                  49           58
Dilutive Shares from Options                          9            10
Dilutive Shares from Options as a % of Options in the 19        %  17        %
Money
Average Exercise Price of Options in the Money        $  63.00     $  60.38
Restricted Stock, PEPUnits and Other Outstanding      13           15
Dilutive Shares from Restricted Stock, PEPUnits and   6            8
Other
Average Intrinsic Value of Restricted Stock Units     $  74.14     $  68.24
Outstanding ^(a)
Average Intrinsic Value of PEPUnits Outstanding ^(a)  $  60.83     $  66.65
(a) Weighted-average intrinsic value at grant date.
A - 5



PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information
Organic Growth Rates
12 Weeks Ended March 22, 2014 and March 23, 2013
(unaudited)
                                                          GAAP       Non-GAAP
            Percent Impact
                                                          Measure    Measure
                                                          Reported   Organic

                                                          % Change   % Change
                                                                     ^(a)
Net Revenue         Effective  Acquisitions  Foreign      12 Weeks   12 Weeks
Year over                      and
Year %      Volume  net                      exchange     Ended      Ended
Change              pricing    divestitures                          3/22/2014
                                             translation  3/22/2014
Frito-Lay
North       2       1          —             (1)          3          4
America
Quaker
Foods North 1       —          —             (1)          —          1
America
Latin
America     (3)     12         —             (11)         (2)        9
Foods
PepsiCo
Americas    1       4          —             (4)          1          5
Foods
PepsiCo
Americas    —       1          —             (1)          —          1
Beverages
Europe      3       4          —             (6)          1          7
Asia,
Middle East 2       4          (5)           (5)          (5)        6
& Africa
Total       1       3          —             (3)          —          4
PepsiCo
                                                          GAAP       Non-GAAP
            Percent Impact
                                                          Measure    Measure
                                                          Reported   Organic
                                                                     % Change
                                                          % Change   ^(a)
Net Revenue         Effective  Acquisitions  Foreign      12 Weeks   12 Weeks
Year over                      and
Year %      Volume  net                      exchange     Ended      Ended
Change              pricing    divestitures                          3/23/2013
                                             translation  3/23/2013
Frito-Lay
North       4       —          —             —            4          4
America
Quaker
Foods North 3       (1)        —             —            2          2
America
Latin
America     1       13         —             (3)          11         14
Foods
PepsiCo
Americas    3       3          —             (1)          5          6
Foods
PepsiCo
Americas    (5)     5          —             —            (1)        —
Beverages
Europe      2       2          —             1            5          4
Asia,
Middle East 15      —          (27)          (2)          (14)       15
& Africa
Total       1       3          (3)           (0.5)        1          4
PepsiCo
(a) Organic percent change is a financial measure that is not in accordance
with GAAP and is calculated by excluding the impact of acquisitions and
divestitures and foreign exchange translation from reported growth.
Note – Certain amounts above may not sum due to rounding.
A - 6



PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information (cont.)
Year over Year Growth Rates
12 Weeks Ended March 22, 2014 and March 23, 2013
(unaudited)
                                                                            Non-                    Non-
             GAAP
                                                                            GAAP                    GAAP
             Measure
                                                                            Measure                 Measure
                                                                                                    Core

             Reported                                                       Core ^(a)  Percent      Constant
                        Percent Impact of Non-Core Adjustments                                      Currency
             % Change                                                       % Change   Impact of    ^(a)

                                                                                                    % Change
                        Commodity  Merger       Restructuring
Operating    12 Weeks                                          Venezuela    12 Weeks   Foreign      12 Weeks
Profit Year             mark-to-   and          and
             Ended                                             currency     Ended      exchange     Ended
over Year %             market     integration  impairment
Change       3/22/2014  net                                    devaluation  3/22/2014  translation  3/22/2014
                                   charges      charges
                        impact
Frito-Lay
North        4          —          —            1              —            5          1            6
America
Quaker Foods
North        (11)       —          —            1              —            (10)       1            (9)
America
Latin
America      7          —          —            (4)            —            3.5        10           13
Foods
PepsiCo
Americas     2          —          —            —              —            3          2            5
Foods
PepsiCo
Americas     (24)       —          —            15             2            (7)        3            (3)
Beverages
Europe       72         —          (2)          (8)            —            62         1            64
Asia, Middle
East &       5          —          —            2              —            7          3            10
Africa
Division
Operating    (2)        —          —            4              1            3          2.5          6
Profit
Impact of
Corporate    11         (3)        —            1              (7)          1          —            1
Unallocated
Total
Operating    9          (3)        —            5              (7)          4          3            7
Profit
Net Income
Attributable 13                                                             5          3            9

to PepsiCo
Net Income
Attributable

to PepsiCo   15                                                             7          3            10
per common

share -
diluted
                                                                            Non-                    Non-
             GAAP
                                                                            GAAP                    GAAP
             Measure
                                                                            Measure                 Measure
                                                                                                    Core

             Reported                                                       Core ^(a)  Percent      Constant
                        Percent Impact of Non-Core Adjustments
             % Change                                                       % Change   Impact of    Currency
                                                                                                    ^(a)

                                                                                                    % Change
                        Commodity  Merger       Restructuring
Operating    12 Weeks                                          Venezuela               Foreign
Profit Year             mark-to-   and          and                         12 Weeks                12 Weeks
             Ended                                             currency     Ended      exchange     Ended
over Year %             market     integration  impairment                  3/23/2013               3/23/2013
Change       3/23/2013  net                                    devaluation             translation
                                   charges      charges
                        impact
Frito-Lay
North        6          —          —            (1)            —            5          —            5
America
Quaker Foods
North        (4)        —          —            (3)            —            (6)        —            (6)
America
Latin
America      18         —          —            (1)            —            17         8            25
Foods
PepsiCo
Americas     6          —          —            (1)            —            5          1            7
Foods
PepsiCo
Americas     8          —          —            (1.5)          (2.5)        3          —            4
Beverages
Europe       10         —          (1)          6              —            14         (0.5)        14
Asia, Middle
East &       24         —          —            (5)            —            18         1            19
Africa
Division
Operating    8          —          —            (1)            (1)          6          1            7
Profit
Impact of
Corporate    (12)       6          —            —              7            1          —            1.5
Unallocated
Total
Operating    (4)        6          —            (1)            6            7          1            9
Profit
Net Income
Attributable (5)                                                            10         1            12
to PepsiCo
Net Income
Attributable
to PepsiCo   (3)                                                            12         1            13
per common
share -
diluted
(a) Core results and core constant currency results are financial measures that are not in accordance with
GAAP and exclude the above non-core adjustments. See A-13 through A-14 for a discussion of each of these
adjustments.
Note – Certain amounts above may not sum due to rounding.
A - 7



PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information (cont.)
Certain Line Items
12 Weeks Ended March 22, 2014 and March 23, 2013
(in millions except per share amounts, unaudited)
                               GAAP                                  Non-GAAP
                               Measure
                                                                     Measure
                               Reported   Non-Core Adjustments       Core ^(a)
                               12 Weeks   Commodity   Restructuring  12 Weeks
                                          mark-to-    and
                               Ended      market net  impairment     Ended
                                          impact      charges        3/22/2014
                               3/22/2014
Cost of sales                  $ 5,747    $  46       $   —          $ 5,793
Selling, general and           $ 5,048    $  (12)     $   (98)       $ 4,938
administrative expenses
Operating profit               $ 1,807    $  (34)     $   98         $ 1,871
Provision for income taxes     $ 389      $  (13)     $   22         $ 398
Net income attributable to     $ 1,216    $  (21)     $   76         $ 1,271
PepsiCo
Net income attributable to
PepsiCo per common share -     $ 0.79     $  (0.01)   $   0.05       $ 0.83
diluted
Effective tax rate             24.1    %                             23.7    %



               GAAP                                                           Non-GAAP

               Measure                                                        Measure
               Reported   Non-Core Adjustments                                Core ^(a)
                          Commodity  Merger       Restructuring
               12 Weeks   mark-to-                and            Venezuela    12 Weeks
               Ended      market     and          impairment     currency     Ended
               3/23/2013  net        integration  charges        devaluation  3/23/2013
                          impact     charges
Cost of sales  $ 5,834    $  (14)    $   —        $   —          $  —         $ 5,820
Selling,
general and    $ 5,066    $  (2)     $   (1)      $   (11)       $  (111)     $ 4,941
administrative
expenses
Operating      $ 1,658    $  16      $   1        $   11         $  111       $ 1,797
profit
Provision for  $ 386      $  5       $   —        $   3          $  —         $ 394
income taxes
Net income
attributable   $ 1,075    $  11      $   1        $   8          $  111       $ 1,206
to PepsiCo
Net income
attributable
to PepsiCo per $ 0.69     $  0.01    $   —        $   0.01       $  0.07      $ 0.77
common share -
diluted
Effective tax  26.3    %                                                      24.5    %
rate
(a) Core results are financial measures that are not in accordance with GAAP and
exclude the above non-core adjustments. See A-13 through A-14 for a discussion of each
of these adjustments.
Note – Certain amounts above may not sum due to rounding.
A - 8



PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information (cont.)
Operating Profit by Division
12 Weeks Ended March 22, 2014 and March 23, 2013
(in millions, unaudited)
                                GAAP                                               Non-GAAP
                                                    Non-Core Adjustments
                                Measure                                            Measure
                                Reported                                           Core ^(a)
                                                    Commodity      Restructuring
                                12 Weeks                                           12 Weeks
                                                    mark-to-       and
Operating Profit                Ended                                              Ended
                                                    market         impairment
                                3/22/2014                                          3/22/2014
                                                    net impact     charges
Frito-Lay North America         $     862           $  —           $  13           $ 875
Quaker Foods North America      160                 —              2               162
Latin America Foods             232                 —              (4)             228
PepsiCo Americas Foods          1,254               —              11              1,265
PepsiCo Americas Beverages      429                 —              86              515
Europe                          152                 —              —               152
Asia, Middle East & Africa      194                 —              4               198
Division Operating Profit       2,029               —              101             2,130
Corporate Unallocated           (222)               (34)           (3)             (259)
Total Operating Profit          $     1,807         $  (34)        $  98           $ 1,871
                                                                                     Non-
            GAAP
                       Non-Core Adjustments                                          GAAP
            Measure
                                                                                     Measure
            Reported                                                                 Core ^(a)
                                        Merger         Restructuring
                       Commodity
Operating   12 Weeks                    and            and             Venezuela     12 Weeks
Profit      Ended      mark-to-market                                  currency      Ended
            3/23/2013                   integration    impairment      devaluation   3/23/2013
                       net impact
                                        charges        charges
Frito-Lay
North       $  828     $    —           $    —         $    2          $  —          $  830
America
Quaker
Foods North 180        —                —              (1)             —             179
America
Latin
America     216        —                —              4               —             220
Foods
PepsiCo
Americas    1,224      —                —              5               —             1,229
Foods
PepsiCo
Americas    565        —                —              —               (13)          552
Beverages
Europe      88         —                1              4               —             93
Asia,
Middle East 184        —                —              1               —             185
& Africa
Division
Operating   2,061      —                1              10              (13)          2,059
Profit
Corporate   (403)      16               —              1               124           (262)
Unallocated
Total
Operating   $  1,658   $    16          $    1         $    11         $  111        $  1,797
Profit
(a) Core results are financial measures that are not in accordance with GAAP and exclude the
above non-core adjustments. See A-13 through A-14 for a discussion of each of these
adjustments.
A - 9



PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information (cont.)
(unaudited)
Global Snacks Net Revenue Growth Reconciliation
                                       12 Weeks Ended
                                       3/22/2014
Reported Net Revenue Growth            1              %
Impact of Foreign Exchange Translation 4
Organic Revenue Growth                 5              %



Global Beverages Net Revenue Growth Reconciliation
                                        12 Weeks Ended
                                        3/22/2014
Reported Net Revenue Growth             (1)            %
Impact of Acquisitions and Divestitures 1
Impact of Foreign Exchange Translation  2
Organic Revenue Growth                  3              %



Developing and Emerging Markets Net Revenue Growth Reconciliation
                                                            12 Weeks Ended
                                                            3/22/2014
Reported Developing and Emerging Markets Net Revenue Growth (2)            %
Impact of Acquisitions and Divestitures                     1.5
Impact of Foreign Exchange Translation                      10
Developing and Emerging Markets Organic Revenue Growth      9              %



Gross Margin Growth Reconciliation
                                    12 Weeks Ended
                                    3/22/2014
Reported Gross Margin Growth        84             bps
Commodity Mark-to-Market Net Impact (47)
Core Gross Margin Growth            37             bps



Operating Margin Growth Reconciliation
                                      12 Weeks Ended
                                      3/22/2014
Reported Operating Margin Growth      113             bps
Commodity Mark-to-Market Net Impact   (39)
Merger and Integration Charges        (1)
Restructuring and Impairment Charges  69
Venezuela Currency Devaluation        (88)
Core Operating Margin Growth          54              bps
Note – Certain amounts above may not sum due to rounding.
A - 10



PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information (cont.)
(unaudited)
Net Revenue Year-over-Year Growth Reconciliation
               GAAP Measure                                   Non-GAAP
                                                              Measure
               Reported Growth   Percent Impact of            Organic Growth
               12 Weeks Ended    Foreign Exchange             12 Weeks Ended
               3/22/2014         Translation                  3/22/2014
Mexico (Foods) (MSD)           % MSD                        % (LSD)          %
LAF (excluding LSD             % DD                         % DD             %
Mexico)



Diluted EPS Reconciliation
                                     Year Ended
                                     12/28/2013
Reported Diluted EPS                 $  4.32
Commodity Mark-to-Market Net Impact  0.03
Merger and Integration Charges       0.01
Restructuring and Impairment Charges 0.08
Venezuela Currency Devaluation       0.07
Tax Benefits                         (0.13)
Core Diluted EPS                     $  4.37



Net Cash Provided by Operating Activities Reconciliation (in billions)
                                                    2014

                                                    Guidance
Net Cash Provided by Operating Activities           $~10
Net Capital Spending                                ~(3)
Free Cash Flow                                      ~7
Certain Other Items ^(a)                            ~0
Free Cash Flow Excluding Certain Other Items        $ ~7

(a) Certain other items include discretionary pension and retiree medical
contributions, merger and integration payments, payments related to
restructuring charges and net capital investments related to restructuring
plan.
Note – Certain amounts above may not sum due to rounding.
A - 11



Cautionary Statement

Statements in this communication that are "forward-looking statements,"
including our 2014 guidance, are based on currently available information,
operating plans and projections about future events and trends. Terminology
such as"aim," "anticipate," "believe," "drive," "estimate," "expect,"
"expressed confidence," "forecast," "future," "goals," "guidance," "intend,"
"may," "plan," "position," "potential," "project," " seek," "should,"
"strategy," "target," "will" or similar statements or variations of such terms
are intended to identify forward-looking statements, although not all
forward-looking statements contain such terms. Forward- looking statements
inherently involve risks and uncertainties that could cause actual results to
differ materially from those predicted in such forward-looking statements.
Such risks and uncertainties include, but are not limited to: changes in
demand for PepsiCo's products, as a result of changes in consumer preferences
or otherwise; changes in the legal and regulatory environment; imposition of
new taxes, disagreements with tax authorities or additional tax liabilities;
PepsiCo's ability to compete effectively; PepsiCo's ability to grow its
business in developing and emerging markets or unstable political conditions,
civil unrest or other developments and risks in the markets where PepsiCo's
products are sold; unfavorable economic conditions in the countries in which
PepsiCo operates; increased costs, disruption of supply or shortages of raw
materials and other supplies; failure to realize anticipated benefits from
PepsiCo's productivity initiatives or global operating model; disruption of
PepsiCo's supply chain; damage to PepsiCo's reputation; failure to
successfully complete or integrate acquisitions and joint ventures into
PepsiCo's existing operations or to complete or manage divestitures or
refranchisings; PepsiCo's ability to hire or retain key employees or a highly
skilled and diverse workforce; trade consolidation or the loss of any key
customer; any downgrade or potential downgrade of PepsiCo's credit ratings;
PepsiCo's ability to protect its information systems against a cybersecurity
incident; PepsiCo's ability to build and sustain proper information technology
infrastructure, successfully implement its ongoing business transformation
initiative or share services for certain functions effectively; fluctuations
or other changes in exchange rates; climate change, or legal, regulatory or
market measures to address climate change; failure to successfully negotiate
collective bargaining agreements or strikes or work stoppages; any
infringement of or challenge to PepsiCo's intellectual property rights;
potential liabilities and costs from litigation or legal proceedings; and
other factors that may adversely affect the price of PepsiCo's common stock
and financial performance.

For additional information on these and other factors that could cause
PepsiCo's actual results to materially differ from those set forth herein,
please see PepsiCo's filings with the Securities and Exchange Commission,
including its most recent annual report on Form 10-K and subsequent reports on
Forms 10-Q and 8-K. Investors are cautioned not to place undue reliance on any
such forward-looking statements, which speak only as of the date they are
made. PepsiCo undertakes no obligation to update any forward-looking
statements, whether as a result of new information, future events or
otherwise.

Miscellaneous Disclosures

In discussing financial results and guidance, the company may refer to certain
non-GAAP measures. Reconciliations of any such non-GAAP measures to the most
directly comparable financial measures in accordance with GAAP can be found in
the attached exhibits, as well as on the company's website at www.pepsico.com
in the "Investors" section under "Events & Presentations." Our non-GAAP
measures exclude from reported results those items that management believes
are not indicative of our ongoing performance and reflect how management
evaluates our operating results and trends.

Glossary

Acquisitions and divestitures: All merger and acquisition activity, including
the impact of acquisitions, divestitures and changes in ownership or control
in consolidated subsidiaries and nonconsolidated equity investees.

Beverage volume: Volume shipped to retailers and independent distributors from
both PepsiCo and our bottlers.

Constant currency: Financial results assuming constant foreign currency
exchange rates used for translation based on the rates in effect for the
comparable prior-year period. In order to compute our constant currency
results, we multiply or divide, as appropriate, our current year U.S. dollar
results by the current year average foreign exchange rates and then multiply
or divide, as appropriate, those amounts by the prior year average foreign
exchange rates.

Core: Core results are non-GAAP financial measures which exclude certain items
from our historical results. In 2014, core results exclude the commodity
mark-to-market net impact included in corporate unallocated expenses and
restructuring and impairment charges. In 2013, core results exclude the
commodity mark-to-market net impact included in corporate unallocated
expenses, merger and integration charges in connection with our acquisition of
Wimm-Bill-Dann Foods OJSC (WBD), restructuring and impairment charges and a
charge related to the 2013 Venezuela currency devaluation. See "Reconciliation
of GAAP and Non-GAAP Information" for additional information.

A - 12

Division operating profit: The aggregation of the operating profit for each of
our reportable segments, which excludes the impact of corporate unallocated
expenses.

Effective net pricing: Reflects the year-over-year impact of discrete pricing
actions, sales incentive activities and mix resulting from selling varying
products in different package sizes and in different countries.

Free cash flow: Net cash provided by operating activities less capital
spending plus sales of property, plant and equipment. See above for a
reconciliation of this non-GAAP financial measure to the most directly
comparable financial measure in accordance with GAAP (operating cash flow).

Free cash flow, excluding certain items: Free cash flow, excluding: (1)
discretionary pension and retiree medical contributions, (2) merger and
integration payments, (3) payments related to restructuring charges, (4) net
capital investments related to restructuring plan and (5) the tax impacts
associated with each of these items, as applicable. This non-GAAP financial
measure is our primary measure used to monitor cash flow performance. See
above for a reconciliation of this non-GAAP financial measure to the most
directly comparable financial measure in accordance with GAAP (operating cash
flow). See "Reconciliation of GAAP and Non-GAAP Information" for additional
information.

Mark-to-market gain or loss or net impact: Change in market value for
commodity contracts that we purchase to mitigate the volatility in costs of
energy and raw materials that we consume. The market value is determined based
on average prices on national exchanges and recently reported transactions in
the marketplace.

Net capital spending: Capital spending less cash proceeds from sales of
property, plant and equipment.

Organic: A measure that adjusts for impacts of acquisitions, divestitures and
other structural changes, and in the case of organic revenue, foreign exchange
translation. In excluding the impact of foreign exchange translation, we
assume constant foreign exchange rates used for translation based on the rates
in effect for the comparable prior-year period. See the definition of
"Constant currency" for additional information.

Reconciliation of GAAP and Non-GAAP Information (unaudited)

Division operating profit, core results, core constant currency results and
organic results are non-GAAP financial measures as they exclude certain items
noted below. However, we believe investors should consider these measures as
they are more indicative of our ongoing performance and reflect how management
evaluates our operational results and trends.

Commodity mark-to-market net impact

In the 12 weeks ended March 22, 2014, we recognized $34 million of
mark-to-market net gains on commodity hedges in corporate unallocated
expenses. In the 12 weeks ended March 23, 2013, we recognized $16 million of
mark-to-market net losses on commodity hedges in corporate unallocated
expenses. We centrally manage commodity derivatives on behalf of our
divisions. These commodity derivatives include agricultural products, energy
and metals. Certain of these commodity derivatives do not qualify for hedge
accounting treatment and are marked to market with the resulting gains and
losses recognized in corporate unallocated expenses, as either cost of sales
or selling, general and administrative expenses, depending on the underlying
commodity. These gains and losses are subsequently reflected in division
results when the divisions recognize the cost of the underlying commodity in
operating profit.

Merger and integration charges

In the 12 weeks ended March 23, 2013, we incurred merger and integration
charges of $1 million related to our acquisition of WBD, recorded in the
Europe segment.

Restructuring and impairment charges

  2014 Multi-Year Productivity Plan

  In the 12 weeks ended March 22, 2014, we incurred restructuring and
  impairment charges of $96 million in conjunction with the multi-year
  productivity plan we publicly announced on February 13, 2014 (2014
  Productivity Plan), including $12 million recorded in the FLNA segment, $2
  million recorded in the QFNA segment, $1 million recorded in the LAF
  segment, $82 million recorded in the PAB segment, $2 million recorded in the
  Europe segment, $2 million recorded in the AMEA segment and income of $5
  million recorded in corporate unallocated expenses representing adjustments
  of previously recorded amounts. The 2014 Productivity Plan includes the next
  generation of productivity initiatives that we believe will strengthen our
  food, snack and beverage businesses by accelerating our investment in
  manufacturing automation; further optimizing our global manufacturing
  footprint, including closing certain manufacturing facilities;
  re-engineering our go-to-market systems in developed markets; expanding
  shared services; and implementing simplified organization structures to
  drive efficiency.

A - 13

  2012 Multi-Year Productivity Plan

  In the 12 weeks ended March 22, 2014, we incurred restructuring and
  impairment charges of $2 million in conjunction with the multi-year
  productivity plan we publicly announced on February 9, 2012 (2012
  Productivity Plan), including $1 million recorded in the FLNA segment, $4
  million recorded in the PAB segment, $2 million recorded in the AMEA
  segment, $2 million recorded in corporate unallocated expenses and income of
  $5 million recorded in the LAF segment and $2 million recorded in the Europe
  segment representing adjustments of previously recorded amounts.

  In the 12 weeks ended March 23, 2013, we incurred restructuring and
  impairment charges of $11 million in conjunction with our 2012 Productivity
  Plan, including $2 million recorded in the FLNA segment, $4 million recorded
  in the LAF segment, $4 million recorded in the Europe segment, $1 million
  recorded in the AMEA segment, $1 million recorded in corporate unallocated
  expenses and income of $1 million recorded in the QFNA segment representing
  adjustments of previously recorded amounts. The 2012 Productivity Plan
  includes actions in every aspect of our business that we believe will
  strengthen our complementary food, snack and beverage businesses by
  leveraging new technologies and processes across PepsiCo's operations,
  go-to-market and information systems; heightening the focus on best practice
  sharing across the globe; consolidating manufacturing, warehouse and sales
  facilities; and implementing simplified organization structures, with wider
  spans of control and fewer layers of management.

Venezuela currency devaluation

In the 12 weeks ended March 23, 2013 we recorded a $111 million net charge
related to the devaluation of the bolivar for our Venezuela businesses. $124
million of this charge was recorded in corporate unallocated expenses, with
the balance (equity income of $13 million) recorded in our PAB segment.

Free cash flow, excluding certain items

Additionally, free cash flow (excluding the items noted in the Net Cash
Provided by Operating Activities Reconciliation table) is the primary measure
management uses to monitor cash flow performance. This is not a measure
defined by GAAP. Since net capital spending is essential to our product
innovation initiatives and maintaining our operational capabilities, we
believe that it is a recurring and necessary use of cash. As such, we believe
investors should also consider net capital spending when evaluating our cash
from operating activities. Additionally, we consider certain other items
(included in the Net Cash Provided by Operating Activities Reconciliation
table) in evaluating free cash flow which we believe investors should consider
in evaluating our free cash flow results.

2014 guidance and long-term targets

Our 2014 core tax rate guidance and our 2014 core constant currency EPS
guidance exclude the commodity mark-to-market net impact included in corporate
unallocated expenses and restructuring and impairment charges. Our 2014
organic revenue guidance and our long-term organic revenue growth target
exclude the impact of acquisitions, divestitures and other structural changes.
In addition, our 2014 organic revenue guidance, our full-year projected 2014
core constant currency EPS guidance and our long-term organic revenue growth
target exclude the impact of foreign exchange. We are not able to reconcile
our full-year projected 2014 core tax rate guidance to our full-year projected
2014 reported tax rate or our 2014 core constant currency EPS guidance to our
full-year projected 2014 reported EPS growth because we are unable to predict
the 2014 impact of foreign exchange or the mark-to-market net impact on
commodity hedges due to the unpredictability of future changes in foreign
exchange rates and commodity prices. We are also unable to reconcile our
full-year projected 2014 organic revenue guidance to our full-year projected
2014 reported net revenue growth or our long-term organic revenue growth
target to our long-term net revenue growth target because we are unable to
predict the 2014 and long-term impact of foreign exchange due to the
unpredictability of future changes in foreign exchange rates. Therefore, we
are unable to provide a reconciliation of these measures.

A - 14



Logo- http://photos.prnewswire.com/prnh/20140415/73233

SOURCE PepsiCo

Website: http://www.pepsico.com
Contact: Investor: Jamie Caulfield, Senior Vice President, Investor Relations,
914-253-3035, jamie.caulfield@pepsico.com; or Media, Jeff Dahncke, Senior
Director, Media Bureau, 914-253-3941, jeff.dahncke@pepsico.com
 
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