You are on page 1of 46

PEPSICO INC (PEP) CashFlowFlag INCOME STATEMENT

Fiscal year ends in December. USD in millions except per share data.
Revenue
Cost of revenue
Gross profit
Operating expenses
Sales, General and administrative
Other operating expenses
Total operating expenses
Operating income EBIT
Interest Expense
Other income (expense)
Income before taxes
Provision for income taxes
Net income from continuing operations
Other
Net income
Net income available to common shareholders
Earnings per share
Basic
Diluted
Weighted average shares outstanding
Basic
Diluted
EBITDA

2009-12

2010-12
43232 57838
20099 26575
23133 31263
15026
63
15089
8044
397
432
8079
2100
5979
-33
5946
5946

22814
117
22931
8332
903
803
8232
1894
6338
-18
6320
6320

3.81
3.77

3.97
3.91

1558
1577
10111

1590
1614
9252

2011-12 2012-12 2013-12 TTM


66504 65492 66415 66457
31593 31291 31243 31156
34911 34201 35172 35301
25145
133
25278
9633
856
57
8834
2372
6462
-19
6443
6443

24970
119
25089
9112
899
91
8304
2090
6214
-36
6178
6178

25357 25339
110
108
25467 25447
9705 9854
911
898
97
80
8891 9036
2104 2107
6787 6929
-47
-48
6740 6881
6740 6881

4.08
4.03

3.96
3.92

4.37
4.32

1576
1597
12427

1557
1575
9322

1541 1536
1560 1554
9912 10025

8965.2
793.2

11.30

4.48
4.43

Re

WACC

WACC

Net Sales
Americas
Europe
Asia, Middle East and Africa
Average net sales 5 years risk premium
PepsiCo Europe includes South Africa (Risk Premium)
Assumption that Americas (2/3 NA and 1/3 LA) Risk Premium

Total Net Sales


Americas
Europe
Asia, Middle East and Africa
Average Risk Premium
Americas
Europe
Asia, Middle East and Africa
Country Risk Premium
Market Premium
Risk Free Rate (18/04/2014)
Interest Coverage Ratio
Default Spread
% of Company Revenues Derived Domestically
% of Revenues Derived Domestically (Average)
Company Exposure to Country Risk
Return on Equity
Cost of Debt
Re

5.26%
Debt Market Value
Equity

WACC

WACC

0.002566679
0.043025666
0.045592345
4.56%

2009
43232
29830
9079
4323

59896
41328
12578
5990
1.85%
3.49%
4.47%
2.454100%
3.25%
2.72%
11.30
0.40%
52%
86%
0.60
5.49%
2.75
21924.03791
98523.44

2010 2011 2012 2013 Average


57838 66504 65492 66415
59896
39908 45888 45189 45826
41328
12146 13966 13753 13947
12578
5784 6650 6549 6642
5990

100%
69% Annual 2013 Report
21%
10%

http://www.bloomberg.com/markets/rates-bonds/government-bonds/us/

http://www.wikinvest.com/stock/Pepsico_%28PEP%29

onds/government-bonds/us/

PEPSICO INC (PEP) CashFlowFlag BALANCE SHEET


Fiscal year ends in December. USD in millions except per share data.
Assets
Current assets
Cash
Cash and cash equivalents
Short-term investments
Total cash
Receivables
Inventories
Prepaid expenses
Other current assets
Total current assets
Non-current assets
Property, plant and equipment
Gross property, plant and equipment
Accumulated Depreciation
Net property, plant and equipment
Equity and other investments
Goodwill
Intangible assets
Prepaid pension benefit
Other long-term assets
Total non-current assets
Total assets
Liabilities and stockholders' equity
Liabilities
Current liabilities
Short-term debt
Accounts payable
Taxes payable
Accrued liabilities
Other current liabilities
Total current liabilities
Interest bearing debt
Long-term debt
Deferred taxes liabilities
Minority interest
Other long-term liabilities
Total non-current liabilities
Total liabilities
Stockholders' equity
Preferred stock
Common stock
Additional paid-in capital
Retained earnings
Treasury stock

2009-12 2010-12

2011-12

3943
192
4135
4624
2618
1194

5943
426
6369
6323
3372
1505

4067
358
4425
6912
3827
2277

12571

17569

17441

24912
-12241
12671
4484
6534
2623

33041
-13983
19058
1368
14661
13808

35140
-15442
19698
1477
16800
16445

965
27277
39848

1689
50584
68153

1021
55441
72882

464
8127
165

4898
10923
71

8756
7864
7400
659
638
5591
14288
23044

15892
24897
19999
4057
312
6620
30988
46880

6205
4083
192
3686
3988
18154
26773
20568
4995
311
8150
34024
52178

41
30
250
33805
-13528

31
4527
37090
-16745

31
4461
40316
-17875

Accumulated other comprehensive income


Total stockholders' equity
Total liabilities and stockholders' equity

-3794
16804
39848

-3630
21273
68153

-6229
20704
72882

2012-12

2013-12

6297
322
6619
6058
3581
1479
983
18720

9375
303
9678
6033
3409
2162
921
22203

36162
-17026
19136
2351
16971
16525
62
873
55918
74638

36961
-18386
18575
2623
16613
16039
687
738
55275
77478

4815
4451
371
3892
3560
17089
28359
23544
5063
105
6420
35132
52221

5306
4874

26
4178
43158
-19458

5990
3361.4
1723.4
11074.8

6491.6

4034
3625
17839 Average
29639 23506.4
24333
5986
110
295.2
4801
35230
53069

25
4095
46420
-21004

-5487
22417
74638

-5127
24409
77478

PEPSICO INC (PEP) Statement of CASH FLOW


Fiscal year ends in December. USD in millions except per share data.
Cash Flows From Operating Activities
Net income
Depreciation & amortization
Investment/asset impairment charges
Deferred income taxes
Stock based compensation
Accounts receivable
Inventory
Prepaid expenses
Accounts payable
Income taxes payable
Other working capital
Other non-cash items
Net cash provided by operating activities
Cash Flows From Investing Activities
Investments in property, plant, and equipment
Property, plant, and equipment reductions
Acquisitions, net
Purchases of investments
Sales/Maturities of investments
Other investing activities
Net cash used for investing activities
Cash Flows From Financing Activities
Debt issued
Debt repayment
Preferred stock repaid
Common stock repurchased
Excess tax benefit from stock based compensation
Dividend paid
Other financing activities
Net cash provided by (used for) financing activities
Effect of exchange rate changes
Net change in cash
Cash at beginning of period
Cash at end of period
Free Cash Flow
Operating cash flow
Capital expenditure
Free cash flow

2009-12
5979
1635
36
284
227

2010-12

2011-12

17
-127
-133
319
-93
-1348
6796

6338
2327
145
500
299
-268
276
144

6462
2737
383
495
326
-666
-331
-27

123
356
-1792
8448

-340
-168
73
8944

-2128
58
15
-529
71
112
-2401

-3253
81
-3804
-475
29
-246
-7668

-3339
84
-3029
-164
801
29
-5618

1083
-307
-7
42
-2732
-576
-2497
-19
1879
2064
3943

6678
-155
-5
-4978
107
-3137
2876
1386
-166
2000
3943
5943

3862
-2926
-7
-2489
70
-3157
-488
-5135
-67
-1876
5943
4067

6796
-2128
4668

8448
-3253
5195

8944
-3339
5605

2012-12

2013-12

TTM

6214
2689

6787
2663

6929
2644

321
278
-250
144
89

-1058
303
-88
4
-51

-973
298
-271
-51
-84

-97
348
-1257
8479

86
1007
35
9688

17
669
-11
9167

-2714
95
-121

-2795
109
-109

-2847
108
-103

-265
-3005

170
-2625

279
-2563

6548
-2697
-7
-3219
124
-3305
-750
-3306
62
2230
4067
6297

4218
-4386
-7
-3001
117
-3434
2704
-3789
-196
3078
6297
9375

3712
-4384
-7
-3624
128
-3491
4246
-3420
-60
3124
6715
9839

8479
-2714
5765

9688
-2795
6893

9167
-2847
6320

Growth Profitability and Financial Ratios for PepsiCo Inc


Financials
Revenue USD Mil
Gross Margin %
Operating Income USD Mil
Operating Margin %
Net Income USD Mil
Earnings Per Share USD
Dividends USD
Payout Ratio %
Shares Mil
Book Value Per Share USD
Operating Cash Flow USD Mil
Cap Spending USD Mil
Free Cash Flow USD Mil
Free Cash Flow Per Share USD
Working Capital USD Mil
Key Ratios -> Profitability
Margins % of Sales
Revenue
COGS
Gross Margin
SG&A
R&D
Other
Operating Margin
Net Int Inc & Other
EBT Margin
Profitability
Tax Rate %
Net Margin %
Asset Turnover (Average)
Return on Assets %
Financial Leverage (Average)
Return on Equity %
Return on Invested Capital %
Interest Coverage

2004-12 2005-12 2006-12 2007-12


29,261
32,562
35,137
39,474
54.2
56.5
55.1
54.3
5,259
5,922
6,439
7,170
18
18.2
18.3
18.2
4,212
4,078
5,642
5,658
2.44
2.39
3.34
3.41
0.85
1.01
1.16
1.43
35.3
42.3
34.7
41.8
1,729
1,669
1,686
1,656
8.06
8.63
9.41
10.68
5,054
5,852
6,084
6,934
-1,387
-1,736
-2,068
-2,430
3,667
4,116
4,016
4,504
2.12
2.47
2.38
2.72
1,887
1,048
2,270
2,398

2004-12 2005-12 2006-12 2007-12


100
100
100
100
45.82
43.54
44.86
45.7
54.18
56.46
55.14
54.3
35.2
37.82
36.35
35.99
1.02
17.97
0.98
18.95

0.46
18.19
1.41
19.6

0.46
18.33
1.57
19.89

0.15
18.16
1.17
19.33

2004-12 2005-12 2006-12 2007-12


24.74
36.1
19.27
25.86
14.38
12.52
16.03
14.3
1.1
1.09
1.14
1.22
15.79
13.65
18.27
17.49
2.06
2.22
1.94
2
33.05
29.23
37.83
34.46
26.17
21.41
28.78
27.73

Key Ratios -> Growth


2004-12
Revenue %
Year over Year
3-Year Average
5-Year Average

8.49
2.8
7.52

2005-12
11.28
9.05
9.76

2006-12
7.91
9.22
5.46

2007-12
12.34
10.49
9.47

10-Year Average
Operating Income %
Year over Year
3-Year Average
5-Year Average
10-Year Average
Net Income %
Year over Year
3-Year Average
5-Year Average
10-Year Average
EPS %
Year over Year
3-Year Average
5-Year Average
10-Year Average
Key Ratios -> Cash Flow
Cash Flow Ratios
Operating Cash Flow Growth % YOY
Free Cash Flow Growth % YOY
Cap Ex as a % of Sales
Free Cash Flow/Sales %
Free Cash Flow/Net Income
Key Ratios -> Financial Health
Balance Sheet Items (in %)
Cash & Short-Term Investments
Accounts Receivable
Inventory
Other Current Assets
Total Current Assets
Net PP&E
Intangibles
Other Long-Term Assets
Total Assets
Accounts Payable
Short-Term Debt
Taxes Payable
Accrued Liabilities
Other Short-Term Liabilities
Total Current Liabilities
Long-Term Debt
Other Long-Term Liabilities
Total Liabilities
Total Stockholders' Equity
Total Liabilities & Equity

0.27

0.68

1.05

6.56

10
9.36
12.77
5.09

12.61
7.78
12.92
7.08

8.73
10.43
9.87
6.7

11.35
10.88
8.68
9.28

18.05
16.53
15.49
9.17

-3.18
7.17
13.31
9.77

38.35
16.5
16.21
17.25

0.28
10.34
11.3
10.2

19.02
18.4
12.24
8.39

-2.05
8.91
10.06
9.1

39.75
17.67
17.84
16.58

2.1
11.8
13.01
9.63

2004-12 2005-12 2006-12 2007-12


16.77
15.79
3.96
13.97
22.93
12.24
-2.43
12.15
4.74
5.33
5.89
6.16
12.53
12.64
11.43
11.41
0.87
1.01
0.71
0.8

2004-12 2005-12 2006-12 2007-12


12.31
15.39
9.43
7.16
10.72
10.28
12.45
12.67
5.51
5.34
6.44
6.61
2.34
1.95
2.2
2.86
30.87
32.95
30.5
29.31
29.12
27.36
32.37
32.42
19.44
17.98
21.53
20.83
20.58
21.71
15.6
17.43
100
100
100
100
20.01
18.82
7.02
7.4
3.77
9.11
0.92

0.35
24.13
8.56
18.82
51.51
48.49
100

1.72
29.65
7.29
17.93
54.86
45.14
100

8.64
6.34
22.92
8.52
16.95
48.39
51.61
100

8.36
6.63
22.39
12.14
15.44
49.97
50.03
100

Liquidity/Financial Health
Current Ratio
Quick Ratio
Financial Leverage
Debt/Equity

2004-12 2005-12 2006-12 2007-12


1.28
1.11
1.33
1.31
0.95
0.87
0.95
0.89
2.06
2.22
1.94
2
0.18
0.16
0.17
0.24

Key Ratios -> Efficiency Ratios


Efficiency
Days Sales Outstanding
Days Inventory
Payables Period
Cash Conversion Cycle
Receivables Turnover
Inventory Turnover
Fixed Assets Turnover
Asset Turnover

2004-12 2005-12 2006-12 2007-12


36.36
35.09
36.29
37.51
40.2
41.63
41.9
42.66
147.19
148.95
93.47
47.19
-70.63
-72.23
-15.29
32.98
10.04
10.4
10.06
9.73
9.08
8.77
8.71
8.56
3.66
3.87
3.83
3.77
1.1
1.09
1.14
1.22

2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 TTM


43,251
43,232
57,838
66,504
65,492
66,415
66,457
52.9
53.5
54.1
52.5
52.2
53
53.1
6,935
8,044
8,332
9,633
9,112
9,705
9,854
16
18.6
14.4
14.5
13.9
14.6
14.8
5,142
5,946
6,320
6,443
6,178
6,740
6,881
3.21
3.77
3.91
4.03
3.92
4.32
4.43
1.65
1.78
1.89
2.03
2.13
2.24
2.27
51.4
47.1
48.3
50.2
54.2
51.8
51.8
1,602
1,577
1,614
1,597
1,575
1,560
1,554
7.77
10.8
13.46
13.24
14.52
15.96
16.03
6,999
6,796
8,448
8,944
8,479
9,688
9,167
-2,446
-2,128
-3,253
-3,339
-2,714
-2,795
-2,847
4,553
4,668
5,195
5,605
5,765
6,893
6,320
2.84
2.96
3.22
3.51
3.66
4.42
2,019
3,815
1,677
-713
1,631
4,364

2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 TTM


100
100
100
100
100
100
100
47.05
46.49
45.95
47.51
47.78
47.04
46.88
52.95
53.51
54.05
52.49
52.22
52.96
53.12
36.76
34.76
39.44
37.81
38.13
38.18
38.13
0.15
16.03
0.2
16.23

0.15
18.61
0.08
18.69

0.2
14.41
-0.17
14.23

0.2
14.48
-1.2
13.28

0.18
13.91
-1.23
12.68

0.17
14.61
-1.23
13.39

0.16
14.83
-1.23
13.6

2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 TTM


26.76
25.99
23.01
26.85
25.17
23.66
23.32
11.89
13.75
10.93
9.69
9.43
10.15
10.35
1.22
1.14
1.07
0.94
0.89
0.87
0.87
14.56
15.68
11.7
9.14
8.38
8.86
9
2.98
2.38
3.2
3.52
3.33
3.17
3.39
34.99
41.25
33.23
30.7
28.65
28.79
30.35
23.23
25.17
15.89
12.42
11.21
11.53
11.59
22.34
21.35
10.12
11.32
10.24
10.76
11.06

2008-12
9.57
9.92
9.91

2009-12
-0.04
7.16
8.12

2010-12
33.79
13.58
12.18

2011-12
14.98
15.42
13.61

2012-12
-1.52
14.85
10.66

2013-12
1.41
4.72
8.96

Latest Qtr
0.33

6.83

7.82

10.96

9.46

10.06

9.43

-3.28
5.4
7.72
9.22

15.99
7.7
8.87
10.81

3.58
5.13
7.07
9.96

15.61
11.58
8.39
9.13

-5.41
4.24
4.91
6.78

6.51
5.22
6.95
7.34

-9.12
8.03
7.58
9.94

15.64
1.76
7.14
11.24

6.29
3.76
9.16
11.22

1.95
7.81
2.69
9.24

-4.11
1.28
1.77
6.43

9.1
2.17
5.56
6.57

-5.87
10.33
9.38
9.38

17.45
4.12
9.09
10.65

3.71
4.67
10.35
10.2

3.07
7.88
3.83
10.61

-2.73
1.31
2.83
7.8

8.99

14.49

2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 TTM


0.94
-2.9
24.31
5.87
-5.2
14.26
1.09
2.53
11.29
7.89
2.85
19.57
5.66
4.92
5.62
5.02
4.14
4.21
4.28
10.53
10.8
8.98
8.43
8.8
10.38
9.51
0.89
0.79
0.82
0.87
0.93
1.02
0.92

2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 Latest Qtr


6.33
10.38
9.35
6.07
8.87
12.49
13.02
13.01
11.6
9.28
9.48
9.43
8.98
9.37
7.01
6.57
4.95
5.25
4.8
4.4
4.84
3.68
3
2.21
3.12
1.98
2.79
2.82
30.02
31.55
25.78
23.93
25.08
28.66
30.05
32.4
31.8
27.96
27.03
25.64
23.97
23.39
19.4
22.98
41.77
45.61
44.88
42.14
41.24
18.17
13.67
4.49
3.43
4.4
5.22
5.32
100
100
100
100
100
100
100
22.98
20.4
16.03
5.6
5.96
6.29
15
1.03
1.16
7.19
8.51
6.45
6.85
10.11
0.4
0.41
0.1
0.26
0.5
5.06
5.21
5.21
5.47
4.77
4.68
24.41
21.97
23.32
24.91
22.9
23.02
25.11
21.83
18.57
29.34
28.22
31.54
31.41
31.28
20.12
17.29
16.12
18.46
15.53
14.06
14.05
66.37
57.83
68.79
71.59
69.97
68.5
70.44
33.63
42.17
31.21
28.41
30.03
31.5
29.56
100
100
100
100
100
100
100

2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 Latest Qtr


1.23
1.44
1.11
0.96
1.1
1.24
1.2
0.79
1
0.8
0.62
0.8
0.93
0.89
2.98
2.38
3.2
3.52
3.33
3.17
3.39
0.65
0.44
0.94
0.99
1.05
1
1.06

2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 TTM


38.28
39.29
34.54
36.32
36.14
33.22
39.81
43.15
46.67
41.14
41.59
43.21
40.83
44.92
97.16
148.91
130.82
86.68
49.77
54.47
133.96
-15.73
-62.95
-55.15
-8.78
29.58
19.59
-49.23
9.54
9.29
10.57
10.05
10.1
10.99
9.17
8.46
7.82
8.87
8.78
8.45
8.94
8.13
3.78
3.55
3.65
3.43
3.37
3.52
3.59
1.22
1.14
1.07
0.94
0.89
0.87
0.87

2009
43232
29830
9079
4323

Net Sales (Revenues)


Americas
Europe
Asia, Middle East and Africa
Average net sales 5 years Risk premium
PepsiCo Europe includes South Africa (Risk Premium)
Assumption that Americas (2/3 NA and 1/3 LA) Risk Premium
Total Net Sales
Americas
Europe
Asia, Middle East and Africa
Average Risk Premium
Americas
Europe
Asia, Middle East and Africa
Country Risk Premium
Historical Market Premium
Risk Free Rate
Interest Coverage Ratio
Default Spread
% of Company Revenues Derived Domestically
% of Revenues Derived Domestically (Average)
Company Exposure to Country Risk
Cost of Debt
Cost of Equity
Debt Market Value Initial
Equity
Market Value D/E Ratio

59896
41328
12578
5990
1.85%
3.49%
4.47%
2.45%
0.0576
2.75%
11.30
0.40%
51%
86%
0.59
3.15
11.04%
23655
98523
0.19
0.0037
0.0890
0.0927
9.27%
0.0037
0.0106
0.0142
1.42%

WACC High Growth

WACC Stable Growth

31823
Liquidity/Financial Health
Mondelez
Coca Cola
Dr Peppers

Debt/Equity
Debt/Equity
Debt/Equity

ConAgra
Pepsi Co
Average

Debt/Equity

US
Corporate Tax Rate

Unlevered Beta Industry


Levered Beta Industry
Levered Beta PepsiCo

2009
40%

0.29
0.42
Stable Growth
0.33

Share Price
Number of Shares Outstanding
Market Cap

Industry Name
Advertising
Aerospace/Defense
Air Transport
Apparel
Auto & Truck
Auto Parts
Bank
Banks (Regional)
Beverage

85.9
11200000
962080000

Number of firms
243
207
157
1170
129
609
580
947
107

2010
57838
39908
12146
5784

2011
66504
45888
13966
6650

2012
65492
45189
13753
6549

2013 Average
66415
59896
45826
41328
13947
12578
6642
5990

100%
69% Annual 2013 Report
21%
10%

http://pages.stern.nyu.edu/~adamodar/New_Home_Page/spreadsh.htm
ttp://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yieldY
>8,5
http://www.wikinvest.com/stock/Pepsico_%28PEP%29

5.46%
Average share price!!!!!Average outstanding shares

2009-12

2010-12

2011-12

2012-12

2013-12

D/E Ratio

0.7
0.2
0.93

0.75
0.45
0.69

0.66
0.43
1

0.48
0.45
1.12

0.45
0.58
1.1

0.61
0.42
0.97

0.73
0.44

0.66
0.94

0.61
0.99

0.64
1.05

1.69
1

0.87
0.72

2010
40%

2011
40%

2012
40%

2013
40%

0.89
High Growth
1.02

Beta
1.026110269
0.995359163
1.048355464
0.913098727
1.277375437
1.229723376
1.121877266
0.66574041
1.007632297

D/E Ratio
0.292060738
0.206418907
1.123749572
0.201985384
0.799029779
0.28986879
2.924695422
1.083731587
0.224597842

Tax rate
0.170857
0.132489
0.15592
0.147463
0.138994
0.18976
0.1814
0.198549
0.104011

Unlevered beta
Cash/Firm value
Unlevered beta corrected for cash
0.826069 0.072958
0.891080985
0.84419 0.071791
0.909482064
0.538022 0.098222
0.596623977
0.778962 0.054297
0.823685532
0.756753 0.109839
0.850130252
0.995838 0.105722
1.113565653
0.330532 0.179687
0.402933844
0.356286 0.283422
0.497204561
0.838829 0.060286
0.892642479

ges/TextView.aspx?data=yieldYear&year=2009

Levered
Beta
0.68
0.35
0.21

0.42
0.42

2008-12
4683
2522

2009-12
4624
2618

2010-12
6323
3372

2011-12
6912
3827

2012-12
6058
3581

7205
8273
-1068
-2.47%

7242
8127
-885
-1.53%
183

9695
10923
-1228
-1.85%
-343

10739
4083
6656
10.16%
7884

9639
4451
5188
7.81%
-1468

EBIT*(1-t)
Net Capital Expenditure
Change in NWC
FCFF

2009
5953
-435
183
5335

2010
6415
-845
-343
5913

2011
7047
-518
7884
-1355

2012
6819
70
-1468
8357

Operating income EBIT


EBIT(1-t)
Effective Tax Rate

2009
8044
5953
25.99%

2010
8332
6415
23.01%

2011
9633
7047
26.85%

2012
9112
6819
25.17%

2009
-2128
58
-2070
1635
-435

2010
-3253
81
-3172
2327
-845

2011
-3339
84
-3255
2737
-518

2012
-2714
95
-2619
2689
70

Receivables
Inventories
Total CA
Accounts Payable
Non-Cash Working Capital
Change in NWC

Change in NWC
Change in Revenues

CAPEX
Reduction
CAPEX
Depriciation
Net Capital Expenditure

Re-Investment Rate
ROC
Growth Rate

3.98%
24.1%
0.96%

77.82%
13.9%
10.81%

-61.55%
14.8%
-9.13%

22.28%
13.4%
2.99%

2013-12
6033
3409
9442
4874
4568
6.87%
-620
2013
7409
-23
-620
8006

3.17%

-350

2013
9705
7409
23.66%

2013
-2795
109
-2686
2663
-23

10.15%
13.7%
1.39%

1.40%

Adjusted Operating Income (R&D)


EBIT 2013
R&D
Amortization of research asset 2013
2008
388

Value of Research Asset


BV Equity

CAPEX
Reduction
CAPEX
Depriciation
CAPEX - Depreciation

9896.6
9705
665
473.4
2009
414
77.6

2010
488
77.6
82.8

2011
525
77.6
82.8
97.6

2012
552
77.6
82.8
97.6
105

2011
3339
-84
3255
2737
518

2012
2714
-95
2619
2689
-70

1306
24409

2009
2128
-58
2070
1635
435

2010
3253
-81
3172
2327
845

Year

2013
77.6
82.8
97.6
105
110.4
473.4

2013
2795
-109
2686
2663
23

2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
Total

R&D(in
Mn)
665
552
525
488
414
388
364
282
280

Amortization
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
1

Amortized
R&D
0
55.2
105
146.4
165.6
194
218.4
197.4
224
1306

EBIT 2013
R&D
R&D amort
Adj EBIT
Adj EBIT (1-t)

R&D
9705
665
473.4
9896.6
5937.96

Acqusitions 2013

109

Operating Leases
9705
445
268.068
9881.932
5929.1592

CAPEX
9705
2686
2663
9682
5809.2

2009

Operating lease
2010
2011
2012
2013
2014

282
356
356
203
203

Total
EBIT 2009
Operating Lease Exp 2009
Annual Lease Depreciation

0.0315
273
335
324
179
174
1286
8044
262
257

Adjusted Operating Income

8049

2010

Operating lease
2011
2012
2013
2014
2015

390
543
543
320
320

Total
EBIT 2010
Operating Lease Exp 2010
Annual Lease Depreciation

0.0315
378
510
495
283
274
1940
8332
282
388

Adjusted Operating Income

8226

2013

Operating lease
2014
2015
2016
2017
2018

0.0315
441
631
631
375
375

Total
EBIT 2013
Operating Lease Exp 2013
Annual Lease Depreciation

428
593
575
331
321
2248
9705
445
450

Adjusted Operating Income

9700

10 years U.S. Treasury Bond


ttp://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yieldYear&year=2009
2013 yearly average
2012 yearly average
2011 yearly average
2010 yearly average

2009 yearly average


Average
Default Spread > 8,5

0.4 http://pages.stern.nyu.edu/~adamodar/

Cost of Debt

0.4

Market Value of Debt 2013


Value of Operating Leases 2013
Total Market Value Debt

29575
2248
31823

2.75

2012
2013
2014
2015
2016
2017

Operating lease
445
634
634
362
362

Total
2008 Annual Report
EBIT 2012
Operating Lease Exp 2012
Annual Lease Depreciation
Adjusted Operating Income

2011
2012
2013
2014
2015
2016

2009 Annual Report


Total

EBIT 2011
Operating Lease Exp 2011
Annual Lease Depreciation
Adjusted Operating Income

2012 Annual Report

xtView.aspx?data=yieldYear&year=2009

Operating lease
423
598
598
337
337

ages.stern.nyu.edu/~adamodar/

3.15

0.0315
445
596
578
320
310
2248

9112
423
450
9085

0.0315
423
562
545
298
289
2116

9633
390
423
9600

2.35
1.80
2.78
3.22

Cost of Debt
2.75
2.20
3.18
3.62

3.26
2.68

3.66
3.08

Reinvestment rate
Net Capex
Change in NWC
EBIT after tax
RR

Adjusted EBIT
BV of equity
Adjusted for R&D
BV of Debt
Adjusted for Operating leases
ROC for 2013
Growth =

2009-12 2010-12 2011-12 2012-12


435
845
518
-70
183
-343
7884
-1468
5946
6320
6443
6178
0.104
0.079
1.304 -0.249

2013-12
23
-620
6740
-0.089

9896.6
24409
53069
14.597
-1.292917334

Historical Data from Financials:


Revenue
Operating income EBIT
Income before taxes
Net income
EPS Basic

$
$
$
$

2009-12
43,232
8,044
8,079
5,946
3.81

$
$
$
$

2010-12
57,838
8,332
8,232
6,320
3.97

Geometric averages:

Revenue
2009-12
2010-12
2011-12
2012-12
2013-12
Arithmatic average

Geometric average

$
$
$
$
$

Change
43,232
57,838
66,504
65,492
66,415

33.79
14.98
-1.52
1.41
12.16

Relative change
1.34
1.15
0.98
1.01
1.11
11.33

2011-12
$
$
$
$

66,504
9,633
8,834
6,443
4.08

Operating income EBIT


$
$
$
$
$

8,044
8,332
9,633
9,112
9,705

2012-12
$ 65,492
$ 9,112
$ 8,304
$ 6,178
3.96

Change
3.58
15.61
-5.41
6.51
5.07

$
$
$
$

2013-12
66,415
9,705
8,891
6,740
4.37

Relative change
1.04
1.16
0.95
1.07
1.05
4.80

Net income
$
$
$
$
$

5,946
6,320
6,443
6,178
6,740

Change
6.29
1.95
-4.11
9.10
3.30

Relative change
1.06
1.02
0.96
1.09
1.03
3.18

EPS Basic Change


3.81
3.97
4.08
3.96
4.37

4.20
2.77
-2.94
10.35
3.60

Relative change
1.04
1.03
0.97
1.10
1.03
3.49

Country
Angola
Benin
Botswana
Burkina Faso
Cameroon
Cape Verde
Democratic Republic of Congo
Egypt
Gabon
Ghana
Kenya
Morocco
Mozambique
Namibia
Nigeria
Republic of the Congo
Rwanda
Senegal
Tunisia
Uganda
Zambia
Bangladesh
Cambodia
China
Fiji
Hong Kong
India
Indonesia
Japan
Korea
Macao
Malaysia
Mauritius
Mongolia
Pakistan
Papua New Guinea
Philippines
Singapore
Sri Lanka
Taiwan
Thailand
Vietnam
Australia

Region
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Africa
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Asia
Australia & New Zealand

Country Risk Premium


5.40%
8.25%
1.28%
8.25%
8.25%
8.25%
9.75%
11.25%
5.40%
6.75%
6.75%
3.75%
6.75%
3.30%
5.40%
5.40%
8.25%
6.75%
5.40%
6.75%
6.75%
5.40%
8.25%
0.90%
6.75%
0.60%
3.30%
3.30%
0.90%
0.90%
0.90%
1.80%
2.40%
6.75%
11.25%
6.75%
3.30%
0.00%
6.75%
0.90%
2.40%
8.25%
0.00%

Cook Islands
New Zealand
Abu Dhabi
Bahrain
Israel
Jordan
Kuwait
Lebanon
Oman
Qatar
Ras Al Kaminah
Saudi Arabia
United Arab Emirates
AMEA
Albania
Armenia
Azerbaijan
Belarus
Bosnia and Herzegovina
Bulgaria
Croatia
Czech Republic
Estonia
Georgia
Hungary
Kazakhstan
Latvia
Lithuania
Macedonia
Moldova
Montenegro
Poland
Romania
Russia
Serbia
Slovakia
Slovenia
Ukraine
Andorra
Austria
Belgium
Cyprus
Denmark
Finland

Australia & New Zealand


Australia & New Zealand
Middle East
Middle East
Middle East
Middle East
Middle East
Middle East
Middle East
Middle East
Middle East
Middle East
Middle East

6.75%
0.00%
0.75%
2.85%
1.05%
6.75%
0.75%
6.75%
1.05%
0.75%
1.28%
0.90%
0.75%

Eastern Europe & Russia


Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Eastern Europe & Russia
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe

6.75%
4.50%
3.30%
9.75%
9.75%
2.85%
3.75%
1.05%
1.05%
5.40%
3.75%
2.85%
2.85%
2.40%
5.40%
9.75%
5.40%
1.28%
3.30%
2.40%
6.75%
1.28%
3.75%
11.25%
1.80%
0.00%
0.90%
15.00%
0.00%
0.00%

4.47%

France
Germany
Greece
Iceland
Ireland
Isle of Man
Italy
Liechtenstein
Luxembourg
Malta
Netherlands
Norway
Portugal
Spain
Sweden
Switzerland
Turkey
United Kingdom
South Africa
Europe
Canada
United States of America
NA
Argentina
Belize
Bolivia
Brazil
Chile
Colombia
Costa Rica
Ecuador
El Salvador
Guatemala
Honduras
Mexico
Nicaragua
Panama
Paraguay
Peru
Suriname
Uruguay
Venezuela
Aruba
Bahamas

Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Western Europe
Africa
North America
North America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Central and South America
Caribbean
Caribbean

0.60%
0.00%
15.00%
3.30%
3.75%
0.60%
2.85%
0.00%
0.00%
1.80%
0.00%
0.00%
5.40%
3.30%
0.00%
0.00%
3.30%
0.60%
2.40%
3.49%
0.00%
0.00%
0.00%
9.75%
13.50%
5.40%
2.85%
0.90%
3.30%
3.30%
11.25%
5.40%
3.75%
8.25%
2.40%
9.75%
2.85%
5.40%
2.85%
5.40%
3.30%
11.25%
2.40%
2.40%

Barbados
Bermuda
Cayman Islands
Cuba
Curacao
Dominican Republic
Jamaica
Montserrat
St. Maarten
St. Vincent & the Grenadines
Trinidad and Tobago
Americas

Caribbean
Caribbean
Caribbean
Caribbean
Caribbean
Caribbean
Caribbean
Caribbean
Caribbean
Caribbean
Caribbean

3.75%
0.90%
0.90%
11.25%
6.75%
6.75%
15.00%
3.30%
2.40%
8.25%
2.40%
5.54%

Base year
Revenue growth rate
Revenues
EBIT (Operating) margin
EBIT (Operating income)
Tax rate
EBIT(1-t)
Net CAPEX
Net Working Capital
Change in Net Working Capital
FCFF
PV(FCFF)
WACC

43232 $

$
$

$ 9,700.42
40.00%
$ 5,820.25 $
$ (350.00) $
$ 1,369.10 $
$
$
$

1
0.048
1.048
45,307.14
10,166.04
40.00%
6,099.62
(366.80)
1,434.81
(65.72)
5,667.11
5,186.41
9.27%

2
0.048
1.048
$ 47,481.88

3
0.048
1.048
$ 49,761.01

$ 10,654.01
40.00%
$ 6,392.41
$ (384.41)
$ 1,503.68
$
(68.87)
$ 5,939.13
$ 4,974.31
9.27%

$ 11,165.40
40.00%
$ 6,699.24
$ (402.86)
$ 1,575.86
$
(72.18)
$ 6,224.21
$ 4,770.89
9.27%

4
0.048
1.048
$ 52,149.54
$ 11,701.34
40.00%
$ 7,020.80
$ (422.20)
$ 1,651.50
$
(75.64)
$ 6,522.97
$ 4,575.79
9.27%

$
$
$
$
$
$
$
$

5
0.048
1.048
54,652.71
12,263.01
40.00%
7,357.80
(442.46)
1,730.77
(79.27)
6,836.07
19,472,211.60
9.27%

$
$
$
$
$
$
$
$

6
Terminal year
0.014
1.014
55,417.85
12,434.69
40.00%
7,460.81
(448.65)
1,755.00
(24.23)
6,987.93
30,324,343.64
1.42%

30-Dec-13
Company
Pepsi Co
Coca-cola
Kraft foods
Dr pepple Snapple
Mondelez
Conagra foods
Industry average

P/E
17.6400
19.5400
17.3000
15.9500
22.9800
20.2500
18.9433

Price/Sales
Price/FCF
EV/EBITDA ROA
ROE
1.8900
18.6400 12.9100
8.6900 28.1900
3.9760
22.4100 14.1700
9.6700 26.3600
1.9600
19.8000 10.8000 11.7300 62.7100
1.6610
14.1340 13.6300
7.2800 27.3500
1.7890
37.3700 18.0000
5.2800 12.1100
0.8237
15.9400 12.1900
3.7000 13.7100
2.0166
21.3823 13.6167
7.7250 28.4050

PEP

KO

Market Cap:
Employees:
Qtrly Rev Growth
(yoy):
Revenue (ttm):
Gross Margin
(ttm):
EBITDA (ttm):
Operating Margin
(ttm):

133.55B
274,000

Net Income (ttm):


EPS (ttm):
P/E (ttm):
PEG (5 yr
expected):
P/S (ttm):

DPS
MDLZ
Industry
180.11B
11.42B
63.82B 707.68M
130,600
19,000 107,000
2.00K

-0.04

0.01

-0.01

0.14

66.46B

46.40B

6.02B

35.20B

264.63M

0.53

0.61

0.59

0.37

0.43

12.56B

13.08B

1.38B

5.59B

45.29M

0.15

0.24

0.19

0.13

0.06

6.87B

8.45B

673.00M

1.94B

N/A

N/A
N/A

N/A
N/A

N/A
N/A

N/A
N/A

0.33
26.8

2.69

2.92

2.34

1.54

1.75

2.01

3.88

1.91

1.83

1.7

EPS
4.4300
1.9500
4.5100
3.0500
2.1900
1.8500
2.9967

Choose similar (comparable or like-kind) firms.


Choose bases for multiples.
Determine an appropriate multiple.
Project bases for the valued firm.
Value the firm.