This excerpt taken from the PBG 8-K filed Apr 23, 2008.
Company Confirms Full-Year Earnings Guidance
SOMERS, N.Y.--(BUSINESS WIRE)--The Pepsi Bottling Group, Inc. (NYSE: PBG) today reported first quarter 2008 revenue of $2.7 billion, a seven percent increase over prior year. Net income was $28 million, or diluted earnings per share (EPS) of $0.12. This includes a net charge of $2.5 million or $0.01 per share from restructuring charges and an asset disposal charge, all of which were initiated in 2007. This compares to net income of $29 million, or $0.12 per diluted share, that the Company reported in the first quarter of 2007.
“The first quarter marked a solid start to the year, as we exceeded both our worldwide profit and earnings per share objectives. The diversity and strength of our geographic portfolio, combined with significant cost productivity gains, helped offset a challenging macroeconomic environment in the U.S.,” said Eric Foss, PBG President and Chief Executive Officer. “We also remained committed to investing for future growth, announcing two acquisitions that will enhance our competitive position in Russia and unlock new opportunities to expand our international business.
“Our focus in the second quarter and beyond is on improving our profitability in the U.S. and Canada, capturing the growth potential in Europe, and building upon our encouraging progress in Mexico,” Foss continued. “I believe we have the right plans in place to continue to deliver long-term growth and create shareholder value.”
In the U.S. and Canada segment, physical case volume increased two percent as the Company benefited from the shift of the Easter holiday. Total volume growth was driven by take-home growth of four percent with cold drink down two percent. U.S. volume growth was one percent. In Mexico, volume improved two percent, as positive CSD and bottled water volume growth was offset by non-carbonated and jug water declines. Volume grew seven percent for the quarter in Europe. This was again led by Russia, which delivered double-digit growth in both CSDs and non-carbonated beverages.
Foreign currency translation contributed about three percentage points of growth to net revenue, cost of goods sold (COGS) and selling, delivery and administrative (SD&A) expenses. The net effect was a decrease of three percentage points on operating income.
Reported COGS per case was up eight percent in the first quarter. COGS performance was impacted by increases in input costs, as well as foreign currency translation.
PBG’s reported SD&A expenses grew six percent in the first quarter, with the U.S. flat due to the continued success of cost and productivity initiatives.
In 2008, PBG expects to achieve top-line growth of about six to seven percent. PBG’s comparable operating profit is expected to grow four to six percent for the year. Comparable diluted EPS are forecasted to be $2.30 to $2.38. Operating free cash flow is expected to be at least $620 million.
PBG will host a conference call at 11:00 a.m. EDT today to discuss its first quarter financial results. The live call and replay can be accessed by visiting the Investor Relations section of the Company's website at http://www.pbg.com.