This excerpt taken from the PBG 8-K filed Jun 3, 2009.
- Pepsi Bottling Group, Inc. - Chairman & CEO
John, let me take the first and I will ask Al to address the second. But on the first point around CSDs, I do believe first of all that CSDs are benefiting in light of the current economic conditions. Having said that I don't believe the entire improvement or even the majority of the improvement on CSDs is due to the macroeconomic conditions.
I think there are a couple of things that are happening. One is we feel very good about the work that we have done to strengthen our brand portfolio. I will tell you that I think PepsiCo and the work they have done on the brand identity front, in particular Pepsi and Mountain Dew, we have seen improved performance and trends on those two trademarks. So I think the marketing and brand building work coupled with some of the things we have put in the marketplace relative to value price impact are also driving improved carbonated soft drink performance.
Al Drewes - Pepsi Bottling Group, Inc. - SVP & CFO
So I think, John, on the synergies I think you can think about them in three buckets -- one would be top line, one would be just basic gross margin improvements, and then the other one would be the actual operating expense reductions. You get top-line growth through improved execution for example on some of the products using the DSD system.
The top-line benefit would be maybe a third or so, 30% something like that, of the total amount of the synergies. There would be margin improvement if we did some different things with Aquafina in large-format stores. And then that would be a big piece that was SG&A and manufacturing overhead and as I mentioned G&A expenses as well.
Mary Winn Settino - Pepsi Bottling Group, Inc. - VP, IR and Public Relations
With that, operator, I don't believe we have any other questions in the queue?
You have no further questions in the queue at this time.
Eric Foss - Pepsi Bottling Group, Inc. - Chairman & CEO
Well, let me thank everybody again for joining us this morning. Thanks to everybody for their continued interest in PBG and we look forward to talking to everybody soon.
Thank you, ladies and gentlemen. This does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. Thank you for your participation.