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PBG » Topics » Our business requires a significant supply of raw materials and energy, the limited availability or increased costs of which could adversely affect our business and financial results.These excerpts taken from the PBG 10-K filed Feb 20, 2009. Our
business requires a significant supply of raw materials and
energy, the limited availability or increased costs of which
could adversely affect our business and financial
results.
The production and distribution of our beverage products is
highly dependent on certain ingredients, packaging materials,
other raw materials, and energy. To produce our products, we
require significant amounts of ingredients, such as beverage
concentrate and high fructose corn syrup, as well as access to
significant amounts of water. We also require significant
amounts of packaging materials, such as aluminum and plastic
bottle components, such as resin (a petroleum-based product). In
addition, we use a significant amount of electricity, natural
gas, motor fuel and other energy sources to operate our fleet of
trucks and our bottling plants.
If the suppliers of our ingredients, packaging materials, other
raw materials or energy are impacted by an increased demand for
their products, business
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downturn, weather conditions (including those related to climate
change), natural disasters, governmental regulation, terrorism,
strikes or other events, and we are not able to effectively
obtain the products from another supplier, we could incur an
interruption in the supply of such products or increased costs
of such products. Any sustained interruption in the supply of
our ingredients, packaging materials, other raw materials or
energy, or increased costs thereof, could have a material
adverse effect on our business and financial results.
The prices of some of our ingredients, packaging materials,
other raw materials and energy, including high fructose corn
syrup and motor fuel, are experiencing unprecedented volatility,
which can unpredictably and substantially increase our costs. We
have implemented a hedging strategy to better predict our costs
of some of these products. In a volatile market, however, such
strategy includes a risk that, during a particular period of
time, market prices fall below our hedged price and we pay
higher than market prices for certain products. As a result,
under certain circumstances, our hedging strategy may increase
our overall costs.
If there is a significant or sustained increase in the costs of
our ingredients, packaging materials, other raw materials or
energy, and we are unable to pass the increased costs on to our
customers in the form of higher prices, there could be a
material adverse effect on our business and financial results.
Our business requires a significant supply of raw materials and energy, the limited availability or increased costs of which could adversely affect our business and financial results. The production and distribution of our beverage products is highly dependent on certain ingredients, packaging materials, other raw materials, and energy. To produce our products, we require significant amounts of ingredients, such as beverage concentrate and high fructose corn syrup, as well as access to significant amounts of water. We also require significant amounts of packaging materials, such as aluminum and plastic bottle components, such as resin (a petroleum-based product). In addition, we use a significant amount of electricity, natural gas, motor fuel and other energy sources to operate our fleet of trucks and our bottling plants. If the suppliers of our ingredients, packaging materials, other raw materials or energy are impacted by an increased demand for their products, business 8 Table of Contentsdownturn, weather conditions (including those related to climate change), natural disasters, governmental regulation, terrorism, strikes or other events, and we are not able to effectively obtain the products from another supplier, we could incur an interruption in the supply of such products or increased costs of such products. Any sustained interruption in the supply of our ingredients, packaging materials, other raw materials or energy, or increased costs thereof, could have a material adverse effect on our business and financial results. The prices of some of our ingredients, packaging materials, other raw materials and energy, including high fructose corn syrup and motor fuel, are experiencing unprecedented volatility, which can unpredictably and substantially increase our costs. We have implemented a hedging strategy to better predict our costs of some of these products. In a volatile market, however, such strategy includes a risk that, during a particular period of time, market prices fall below our hedged price and we pay higher than market prices for certain products. As a result, under certain circumstances, our hedging strategy may increase our overall costs. If there is a significant or sustained increase in the costs of our ingredients, packaging materials, other raw materials or energy, and we are unable to pass the increased costs on to our customers in the form of higher prices, there could be a material adverse effect on our business and financial results. These excerpts taken from the PBG 10-K filed Feb 27, 2008. Our
business requires a significant supply of raw materials and
energy, the limited availability or increased costs of which
could adversely affect our business and financial
results.
The production and distribution of our beverage products is
highly dependent on certain raw materials and energy. In
particular, we require significant amounts of aluminum and
plastic bottle
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Table of Contents
components, such as resin. We also require access to significant
amounts of water. In addition, we use a significant amount of
electricity, natural gas, motor fuel and other energy sources to
operate our fleet of trucks and our bottling plants. Any
sustained interruption in the supply of raw materials or energy
or any significant increase in their prices could have a
material adverse effect on our business and financial results.
Our business requires a significant supply of raw materials and energy, the limited availability or increased costs of which could adversely affect our business and financial results. The production and distribution of our beverage products is highly dependent on certain raw materials and energy. In particular, we require significant amounts of aluminum and plastic bottle 9 Table of Contents
components, such as resin. We also require access to significant amounts of water. In addition, we use a significant amount of electricity, natural gas, motor fuel and other energy sources to operate our fleet of trucks and our bottling plants. Any sustained interruption in the supply of raw materials or energy or any significant increase in their prices could have a material adverse effect on our business and financial results. | EXCERPTS ON THIS PAGE:
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