EX-99.1 2 q420218-kxexhibit991.htm EXHIBIT 99.1

Exhibit 99.1

PepsiCo Reports Fourth Quarter and Full-Year 2021 Results; Provides 2022 Financial Outlook; Announces Annual Dividend Increase and New Share Repurchase Program

Reported (GAAP) Fourth Quarter and Full-Year 2021 Results

			Fourth Quarter			Full-Year
Net revenue growth			12.4%			12.9%
Foreign exchange impact on net revenue			—%			1%
Earnings per share (EPS)			$0.95			$5.49
EPS change			(28)%			7%
Foreign exchange impact on EPS			—%			1.5%

Organic/Core (non-GAAP)1 Fourth Quarter and Full-Year 2021 Results

			Fourth Quarter			Full-Year
Organic revenue growth			11.9%			9.5%
Core EPS			$1.53			$6.26
Core constant currency EPS change			4%			12%

PURCHASE, N.Y. - February 10, 2022 - PepsiCo, Inc. (NASDAQ: PEP) today reported results for the fourth quarter and full-year 2021.

“Our full year net revenue growth meaningfully accelerated in 2021 versus the previous year and this gives us added confidence that the investments we’ve made in our people, brands, innovation, supply chain, go-to-market systems and digitization initiatives are working,” said Chairman and CEO Ramon Laguarta.

Laguarta continued, “Moving forward, we remain committed to building advantaged capabilities that can help us win in the marketplace and become an even faster, even stronger and even better organization. Importantly, this includes putting sustainability and human capital at the center of everything we do with the recent implementation of PepsiCo Positive (pep+), a fundamental end-to-end transformation of what we do and how we do it to create growth and shared value.

For 2022, we expect to deliver 6 percent organic revenue growth, which is at the high-end of our long-term target range and implies a strong acceleration in our organic revenue growth on a two-year basis. Additionally, we expect to deliver 8 percent core constant currency earnings per share growth, which reflects the impact of inflationary pressures across our value chain and

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planned investments in our business. We also announced a 7 percent increase in our annualized dividend, starting with our June 2022 payment which represents our 50th consecutive annual increase, and our Board has authorized the repurchase of up to $10 billion of PepsiCo common stock through February 2026.”

1 Refer to the Glossary for the definitions of non-GAAP financial measures including “organic,” “core” and “constant currency,” and to “Guidance and Outlook” for additional information regarding PepsiCo’s full-year 2022 financial outlook. PepsiCo provides guidance on a non-GAAP basis as we cannot predict certain elements which are included in reported GAAP results, including the impact of foreign exchange and commodity mark-to-market net impacts. Please refer to PepsiCo’s Annual Report on Form 10-K for the year ended December 25, 2021 (2021 Form 10-K) filed with the SEC for additional information regarding PepsiCo’s financial results.

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Summary Fourth-Quarter 2021 Performance

			Revenue															Volume(a)
			GAAP Reported % Change			Percentage Point Impact						Organic % Change						% Change
						Foreign Exchange Translation			Acquisitions, Divestitures, and Other Structural Changes									Convenient Food			Beverage
Frito-Lay North America			13			—			—			13						4
Quaker Foods North America			9			—			—			9						(2)
PepsiCo Beverages North America			13			—			—			12									7
Latin America			16			1			—			17						6			9
Europe			8			1			—			9						1			2
Africa, Middle East and South Asia			13			(1)			(4)			8						3.5			12
Asia Pacific, Australia and New Zealand and China Region			18			(2)			(3)			13						16			7
Total			12			—			(0.5)			12						4			7

			Operating Profit and EPS
			GAAP Reported % Change			Percentage Point Impact						Core Constant Currency % Change
						Items Affecting Comparability			Foreign Exchange Translation
Frito-Lay North America			10			(5)			—			5
Quaker Foods North America			8			(2)			—			6
PepsiCo Beverages North America			(10)			—			—			(9)
Latin America			21			(1)			—			20
Europe			(16)			7			(1)			(10)
Africa, Middle East and South Asia			(29)			—			(2)			(31)
Asia Pacific, Australia and New Zealand and China Region			(25)			4			4			(17)
Corporate unallocated expenses			70			(53)			—			17
Total			(9)			6			—			(4)
EPS			(28)			33			—			4

(a)Excludes the impact of acquisitions and divestitures. In certain instances, the impact of organic volume growth on net revenue growth differs from the unit volume change due to product mix, nonconsolidated joint venture volume, and, for our beverage businesses, temporary timing differences between bottler case sales (BCS) and concentrate shipments and equivalents (CSE). Our net revenue excludes nonconsolidated joint venture volume, and, for our franchise-owned beverage businesses, is based on CSE.

Note: Amounts may not sum due to rounding.

Organic revenue growth and core constant currency results are non-GAAP financial measures. Please refer to the reconciliation of GAAP and non-GAAP information in the attached exhibits and to the Glossary for definitions of “organic,” “core” and “constant currency.”

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Discussion of Fourth-Quarter 2021 Reported Division Results:

In addition to the reported net revenue performance as set out in the tables on pages 3 and A-7, reported operating results were driven by the following:

Frito-Lay North America

Operating profit increased 10%, primarily reflecting net revenue growth and productivity savings. These impacts were partially offset by certain operating cost increases, including strategic initiatives and incremental transportation costs, an 8-percentage-point impact of higher commodity costs, primarily cooking oil and packaging material, and higher advertising and marketing expenses. Additionally, lower restructuring and impairment charges contributed 5 percentage points to operating profit growth.

Quaker Foods North America

Operating profit grew 8%, primarily reflecting effective net pricing and productivity savings, partially offset by certain operating cost increases, including incremental transportation costs, a 14-percentage-point impact of higher commodity costs and higher advertising and marketing expenses.

PepsiCo Beverages North America

Operating profit decreased 10%, primarily reflecting certain operating cost increases, including incremental transportation costs, a 37-percentage-point impact of higher commodity costs and higher advertising and marketing expenses. These impacts were partially offset by net revenue growth and productivity savings.

Latin America

Operating profit increased 21%, primarily reflecting net revenue growth, productivity savings and a 6-percentage-point impact of lower charges taken as a result of the COVID-19 pandemic. These impacts were partially offset by certain operating cost increases, a 34-percentage-point impact of higher commodity costs, higher advertising and marketing expenses and a 10-percentage-point impact of certain tax charges.

Europe

Operating profit decreased 16%, primarily reflecting certain operating cost increases, a 41-percentage-point impact of higher commodity costs, higher advertising and marketing expenses and a 5-percentage-point impact of higher restructuring and impairment charges. These impacts were partially offset by net revenue growth and productivity savings. Additionally, lower impact of certain tax charges and lower charges taken as a result of the COVID-19 pandemic each positively contributed 5 percentage points to operating profit performance.

During the fourth quarter of 2021, the implementation of an Enterprise Resource Planning (ERP) system in the United Kingdom caused a temporary disruption to our United Kingdom operations which had a negative impact on net revenue, unit volume and operating profit performance. These issues were largely resolved within the quarter and the business operations had resumed by year end.

Africa, Middle East and South Asia

Operating profit decreased 29%, primarily reflecting certain operating cost increases, a 23-percentage-point impact of higher commodity costs and higher advertising and marketing expenses. These impacts were partially offset by volume growth, productivity savings and a 3-percentage-point impact of lower charges taken as a result of COVID-19 pandemic.

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Asia Pacific, Australia and New Zealand and China Region

Operating profit decreased 25%, primarily reflecting certain operating cost increases, higher advertising and marketing expenses and an 11-percentage-point impact of higher commodity costs, partially offset by net revenue growth and productivity savings. Additionally, higher restructuring and impairment charges, unfavorable foreign exchange and higher charges taken as a result of COVID-19 pandemic negatively impacted operating profit performance by 6 percentage points, 4 percentage points and 3 percentage points, respectively.

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Summary Full-Year 2021 Performance

			Revenue															Volume(a)
			GAAP Reported % Change			Percentage Point Impact						Organic % Change						% Change
						Foreign Exchange Translation			Acquisitions, Divestitures, and Other Structural Changes									Convenient Food			Beverage
Frito-Lay North America			8			(0.5)			—			7						2
Quaker Foods North America			—			(1)			—			—						(7)
PepsiCo Beverages North America			12			(0.5)			(1)			10									5
Latin America			17			(2)			—			15						4			8
Europe			9			(0.5)			—			9						4			8
Africa, Middle East and South Asia			33			(4.5)			(17)			12						3			17
Asia Pacific, Australia and New Zealand and China Region			34			(6)			(15)			13						11			13
Total			13			(1)			(2)			10						2.5			10

			Operating Profit and EPS
			GAAP Reported % Change			Percentage Point Impact						Core Constant Currency  % Change
						Items Affecting Comparability			Foreign Exchange Translation
Frito-Lay North America			5.5			(2)			—			3
Quaker Foods North America			(14)			(0.5)			—			(14)
PepsiCo Beverages North America			26			(5)			(1)			20
Latin America			33			—			(4.5)			28
Europe			(4.5)			3			(1.5)			(3)
Africa, Middle East and South Asia			43			(31)			(2)			10
Asia Pacific, Australia and New Zealand and China Region			14			(0.5)			(3)			10
Corporate unallocated expenses			17			(6)			—			10
Total			11			(2)			(1)			7
EPS			7			6			(1.5)			12

(a)Excludes the impact of acquisitions and divestitures, including the impact of an extra month of volume for our acquisitions of Pioneer Food Group Ltd. (Pioneer Foods) in our Africa, Middle East and South Asia division and Hangzhou Haomusi Food Co., Ltd. (Be & Cheery) in our Asia Pacific, Australia and New Zealand and China Region division as we aligned the reporting calendars of these acquisitions with those of our divisions. In certain instances, the impact of organic volume growth on net revenue growth differs from the unit volume change due to product mix, nonconsolidated joint venture volume, and, for our beverage businesses, temporary timing differences between BCS and CSE. Our net revenue excludes nonconsolidated joint venture volume, and, for our franchise-owned beverage businesses, is based on CSE.

Note: Amounts may not sum due to rounding.

Organic revenue growth and core constant currency results are non-GAAP financial measures. Please refer to the reconciliation of GAAP and non-GAAP information in the attached exhibits and to the Glossary for definitions of “organic,” “core” and “constant currency.”

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Discussion of Full-Year 2021 Reported Division Results:

In addition to the reported net revenue performance as set out in the tables on pages 6 and A-7, reported operating results were driven by the following:

Frito-Lay North America

Operating profit increased 5.5%, primarily reflecting the net revenue growth, productivity savings and a 3-percentage-point impact of lower charges taken as a result of the COVID-19 pandemic. These impacts were partially offset by certain operating cost increases, including strategic initiatives and incremental transportation costs, and a 4-percentage-point impact of higher commodity costs, primarily packaging material and cooking oil.

Quaker Foods North America

Operating profit declined 14%, primarily reflecting certain operating cost increases, including incremental transportation costs, and an 8-percentage-point impact of higher commodity costs, partially offset by productivity savings.

PepsiCo Beverages North America

Operating profit increased 26%, primarily reflecting the net revenue growth, a 15-percentage-point impact of lower charges taken as a result of the COVID-19 pandemic and productivity savings. These impacts were partially offset by certain operating cost increases, including incremental transportation costs, an 18-percentage-point impact of higher commodity costs and higher advertising and marketing expenses. Higher prior-year acquisition and divestiture-related charges contributed 4 percentage points to operating profit growth.

Latin America

Operating profit increased 33%, primarily reflecting the net revenue growth, productivity savings and a 4.5-percentage-point impact of favorable foreign exchange. These impacts were partially offset by certain operating cost increases, a 30-percentage-point impact of higher commodity costs and higher advertising and marketing expenses. A current-year recognition of certain indirect tax credits in Brazil and lower charges taken as a result of the COVID-19 pandemic contributed 6 percentage points and 4 percentage points, respectively, to operating profit growth.

Europe

Operating profit decreased 4.5%, primarily reflecting certain operating cost increases, a 28-percentage-point impact of higher commodity costs and a 2.5-percentage-point impact each from higher restructuring and impairment charges and a gain on an asset sale in the prior year. These impacts were partially offset by the net revenue growth and productivity savings. Additionally, lower charges taken as a result of the COVID-19 pandemic and favorable settlements of promotional spending accruals compared to the prior year positively contributed 5 percentage points and 3 percentage points, respectively, to operating profit performance.

During the fourth quarter of 2021, the implementation of an ERP system in the United Kingdom caused a temporary disruption to our United Kingdom operations which had a negative impact on net revenue, unit volume and operating profit performance. These issues were largely resolved within the quarter and the business operations had resumed by year end.

Africa, Middle East and South Asia

Operating profit increased 43%, primarily reflecting the net revenue growth, a 31-percentage-point impact of the prior-year acquisition and divestiture-related charges associated with our Pioneer Foods acquisition and productivity savings. These impacts were partially offset by certain operating cost

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increases, a 13-percentage-point impact of higher commodity costs and higher advertising and marketing expenses. Additionally, lower charges taken as a result of the COVID-19 pandemic and our Pioneer Foods acquisition contributed 3 percentage points and 2 percentage points, respectively, to operating profit growth.

Asia Pacific, Australia and New Zealand and China Region

Operating profit increased 14%, primarily reflecting the net revenue growth, productivity savings and a 2- percentage-point contribution from our Be & Cheery acquisition, partially offset by certain operating cost increases and higher advertising and marketing expenses. Additionally, impairment charges associated with an equity method investment reduced operating profit growth by 3 percentage points. Favorable foreign exchange contributed 3 percentage points to operating profit growth.

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Juice Transaction

In the first quarter of 2022, we completed the previously announced divestiture of Tropicana, Naked and other select juice brands to PAI Partners for approximately $3.5 billion in cash (pre-tax) and a 39% noncontrolling interest in a newly formed joint venture that will operate across North America and Europe. These juice businesses delivered approximately $3 billion in net revenue in 2021. In the U.S., PepsiCo acts as the exclusive distributor for the new joint venture’s portfolio of brands for small-format and foodservice customers with chilled direct-store-delivery. We expect to record a non-core pre-tax gain of approximately $3 billion in the first quarter of 2022 as a result of this transaction.

Guidance and Outlook

The Company provides guidance on a non-GAAP basis as we cannot predict certain elements which are included in reported GAAP results, including the impact of foreign exchange translation and commodity mark-to-market net impacts.

For 2022, the Company expects:

•A 6 percent increase in organic revenue;

•An 8 percent increase in core constant currency EPS;

•A core annual effective tax rate of 20 percent; and

•Total cash returns to shareholders of approximately $7.7 billion, comprised of dividends of $6.2 billion and share repurchases of $1.5 billion.

In addition, the Company expects a 1.5-percentage-point foreign exchange translation headwind to impact reported net revenue and core EPS growth based on current market consensus rates.

This assumption and the guidance above imply 2022 core earnings per share of $6.67, a 6.5 percent increase compared to 2021 core earnings per share of $6.26.

Dividend Increase and New Share Repurchase Program

The Company today announced a 7 percent increase in its annualized dividend to $4.60 per share from $4.30 per share, effective with the dividend expected to be paid in June 2022. This represents the Company’s 50th consecutive annual dividend per share increase.

The Company also announced a new share repurchase program providing for the repurchase of up to $10 billion of PepsiCo common stock through February 28, 2026.

Prepared Management Remarks and Live Question and Answer Webcast

At approximately 6:30 a.m. (Eastern time) on February 10, 2022, the Company will post prepared management remarks (in pdf format) regarding its fourth quarter and full-year 2021 results, including its outlook for 2022, at www.pepsico.com/investors. At 8:15 a.m. (Eastern time) on February 10, 2022, the Company will host a live question and answer session with investors and financial analysts. Further details will be accessible on the Company’s website at www.pepsico.com/investors.

Contacts:			Investor Relations						Communications
			investor@pepsico.com						pepsicomediarelations@pepsico.com

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PepsiCo, Inc. and Subsidiaries

Consolidated Statement of Income

(in millions except per share amounts)

 

			(Unaudited)
			Quarter Ended												Year Ended
			12/25/2021						12/26/2020												12/25/2021						12/26/2020
Net Revenue			$	25,248					$	22,455											$	79,474					$	70,372
Cost of sales			12,130						10,426												37,075						31,797
Gross profit			13,118						12,029												42,399						38,575
Selling, general and administrative expenses (a)			10,556						9,203												31,237						28,495
Operating Profit			2,562						2,826												11,162						10,080
Other pension and retiree medical benefits income/(expense)			158						(130)												522						117
Net interest expense and other			(1,132)						(339)												(1,863)						(1,128)
Income before income taxes			1,588						2,357												9,821						9,069
Provision for income taxes			247						498												2,142						1,894
Net income			1,341						1,859												7,679						7,175
Less: Net income attributable to noncontrolling interests			19						14												61						55
Net Income Attributable to PepsiCo			$	1,322					$	1,845											$	7,618					$	7,120
Diluted
Net income attributable to PepsiCo per common share			$	0.95					$	1.33											$	5.49					$	5.12
Weighted-average common shares outstanding			1,390						1,388												1,389						1,392

(a)The increase in selling, general and administrative expenses for the quarter and year ended December 25, 2021 as compared to the quarter and year ended December 26, 2020 primarily reflects higher selling and distribution costs.

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PepsiCo, Inc. and Subsidiaries

Supplemental Financial Information

(in millions)

 

						(Unaudited)
						Quarter Ended												Year Ended
						12/25/2021						12/26/2020												12/25/2021						12/26/2020
Net Revenue
Frito-Lay North America						$	6,167					$	5,443											$	19,608					$	18,189
Quaker Foods North America						912						836												2,751						2,742
PepsiCo Beverages North America						7,644						6,793												25,276						22,559
Latin America						2,799						2,411												8,108						6,942
Europe						4,345						4,035												13,038						11,922
Africa, Middle East and South Asia						1,928						1,707												6,078						4,573
Asia Pacific, Australia and New Zealand and China Region						1,453						1,230												4,615						3,445
Total						$	25,248					$	22,455											$	79,474					$	70,372
Operating Profit
Frito-Lay North America						$	1,654					$	1,507											$	5,633					$	5,340
Quaker Foods North America						194						178												578						669
PepsiCo Beverages North America						494						546												2,442						1,937
Latin America						402						333												1,369						1,033
Europe						317						376												1,292						1,353
Africa, Middle East and South Asia						152						214												858						600
Asia Pacific, Australia and New Zealand and China Region						72						96												673						590
Corporate unallocated expenses						(723)						(424)												(1,683)						(1,442)
Total						$	2,562					$	2,826											$	11,162					$	10,080

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PepsiCo, Inc. and Subsidiaries

Consolidated Statement of Cash Flows

(in millions)

			Year Ended
			12/25/2021						12/26/2020
Operating Activities
Net income			$	7,679					$	7,175
Depreciation and amortization			2,710						2,548
Operating lease right-of-use asset amortization			505						478
Share-based compensation expense			301						264
Restructuring and impairment charges			247						289
Cash payments for restructuring charges			(256)						(255)
Acquisition and divestiture-related charges			(4)						255
Cash payments for acquisition and divestiture-related charges			(176)						(131)
Pension and retiree medical plan expenses			123						408
Pension and retiree medical plan contributions			(785)						(562)
Deferred income taxes and other tax charges and credits			298						361
Tax expense related to the Tax Cuts and Jobs Act (TCJ Act)			190						—
Tax payments related to the TCJ Act			(309)						(78)
Change in assets and liabilities:
Accounts and notes receivable			(651)						(420)
Inventories			(582)						(516)
Prepaid expenses and other current assets			159						26
Accounts payable and other current liabilities			1,762						766
Income taxes payable			30						(159)
Other, net			375						164
Net Cash Provided by Operating Activities			11,616						10,613
Investing Activities
Capital spending			(4,625)						(4,240)
Sales of property, plant and equipment			166						55
Acquisitions, net of cash acquired, and investments in noncontrolled affiliates			(61)						(6,372)
Divestitures and sales of investments in noncontrolled affiliates			169						6
Short-term investments, by original maturity:
More than three months - purchases			—						(1,135)
More than three months - maturities			1,135						—
Three months or less, net			(58)						27
Other investing, net			5						40
Net Cash Used for Investing Activities			(3,269)						(11,619)
Financing Activities
Proceeds from issuances of long-term debt			4,122						13,809
Payments of long-term debt			(3,455)						(1,830)
Cash tender offers/debt redemption			(4,844)						(1,100)
Short-term borrowings, by original maturity:
More than three months - proceeds			8						4,077
More than three months - payments			(397)						(3,554)
Three months or less, net			434						(109)
Payments of acquisition-related contingent consideration			(773)						—
Cash dividends paid			(5,815)						(5,509)
Share repurchases - common			(106)						(2,000)
Proceeds from exercises of stock options			185						179
Withholding tax payments on restricted stock units and performance stock units converted			(92)						(96)
Other financing			(47)						(48)
Net Cash (Used for)/Provided by Financing Activities			(10,780)						3,819
Effect of exchange rate changes on cash and cash equivalents and restricted cash			(114)						(129)
Net (Decrease)/Increase in Cash and Cash Equivalents and Restricted Cash			(2,547)						2,684
Cash and Cash Equivalents and Restricted Cash, Beginning of Year			8,254						5,570
Cash and Cash Equivalents and Restricted Cash, End of Year			$	5,707					$	8,254

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PepsiCo, Inc. and Subsidiaries

Consolidated Balance Sheet

(in millions except per share amounts)

			12/25/2021						12/26/2020
ASSETS
Current Assets
Cash and cash equivalents			$	5,596					$	8,185
Short-term investments			392						1,366
Accounts and notes receivable, net			8,680						8,404
Inventories:
Raw materials and packaging			1,898						1,720
Work-in-process			151						205
Finished goods			2,298						2,247
			4,347						4,172
Prepaid expenses and other current assets			980						874
Assets held for sale			1,788						—
Total Current Assets			21,783						23,001
Property, Plant and Equipment, net			22,407						21,369
Amortizable Intangible Assets, net			1,538						1,703
Goodwill			18,381						18,757
Other Indefinite-Lived Intangible Assets			17,127						17,612
Investments in Noncontrolled Affiliates			2,627						2,792
Deferred Income Taxes			4,310						4,372
Other Assets			4,204						3,312
Total Assets			$	92,377					$	92,918
LIABILITIES AND EQUITY
Current Liabilities
Short-term debt obligations			$	4,308					$	3,780
Accounts payable and other current liabilities			21,159						19,592
Liabilities held for sale			753						—
Total Current Liabilities			26,220						23,372
Long-Term Debt Obligations			36,026						40,370
Deferred Income Taxes			4,826						4,284
Other Liabilities			9,154						11,340
Total Liabilities			76,226						79,366
Commitments and contingencies
PepsiCo Common Shareholders’ Equity
Common stock, par value 12/3¢ per share (authorized 3,600 shares; issued, net of repurchased common stock at par value: 1,383 and 1,380 shares, respectively)			23						23
Capital in excess of par value			4,001						3,910
Retained earnings			65,165						63,443
Accumulated other comprehensive loss			(14,898)						(15,476)
Repurchased common stock, in excess of par value (484 and 487 shares, respectively)			(38,248)						(38,446)
Total PepsiCo Common Shareholders’ Equity			16,043						13,454
Noncontrolling interests			108						98
Total Equity			16,151						13,552
Total Liabilities and Equity			$	92,377					$	92,918

A - 4

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Non-GAAP Measures

In discussing financial results and guidance, the Company refers to the following measures which are not in accordance with U.S. Generally Accepted Accounting Principles (GAAP): organic revenue growth, core results and core constant currency results. We use these non-GAAP financial measures internally to make operating and strategic decisions, including the preparation of our annual operating plan, evaluation of our overall business performance and as a factor in determining compensation for certain employees. We believe presenting non-GAAP financial measures provides additional information to facilitate comparison of our historical operating results and trends in our underlying operating results, and provides additional transparency on how we evaluate our business. We also believe presenting these measures allows investors to view our performance using the same measures that we use in evaluating our financial and business performance and trends.

We consider quantitative and qualitative factors in assessing whether to adjust for the impact of items that may be significant or that could affect an understanding of our ongoing financial and business performance or trends. Examples of items for which we may make adjustments include: amounts related to mark-to-market gains or losses (non-cash); charges related to restructuring plans; costs associated with mergers, acquisitions, divestitures and other structural changes; gains associated with divestitures; pension and retiree medical-related amounts (including all settlement and curtailment gains and losses); charges or adjustments related to the enactment of new laws, rules or regulations, such as tax law changes; amounts related to the resolution of tax positions; tax benefits related to reorganizations of our operations; debt redemptions, cash tender or exchange offers; asset impairments (non-cash); and remeasurements of net monetary assets. Previously, certain immaterial pension and retiree medical-related settlement and curtailment gains and losses were not considered items affecting comparability. Pension and retiree medical-related service cost, interest cost, expected return on plan assets, and other net periodic pension costs will continue to be reflected in our core results. See below for a description of adjustments to our U.S. GAAP financial measures included herein. 

Non-GAAP information should be considered as supplemental in nature and is not meant to be considered in isolation or as a substitute for the related financial information prepared in accordance with U.S. GAAP. In addition, our non-GAAP financial measures may not be the same as or comparable to similar non-GAAP measures presented by other companies.

Glossary

We use the following definitions when referring to our non-GAAP financial measures, which may not be the same as or comparable to similar measures presented by other companies:

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

Bottler case sales (BCS): Measure of physical beverage volume shipped to retailers and independent distributors from both PepsiCo and our independent bottlers.

Concentrate shipments and equivalents (CSE): Measure of our physical beverage volume shipments to independent 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. For further information regarding these excluded items refer to “Items Affecting Comparability” in “Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2021 Form 10-K. For the periods presented, core results exclude the following items:

Mark-to-market net impact

Mark-to-market net gains and losses on commodity derivatives in corporate unallocated expenses. These gains and losses are subsequently reflected in division results when the divisions recognize the cost of the underlying commodity in operating profit.

Restructuring and impairment charges

Expenses related to the multi-year productivity plan publicly announced in 2019, which was expanded and extended through the end of 2026 to take advantage of additional opportunities within the initiatives of the plan.

Acquisition and divestiture-related charges

Acquisition and divestiture-related charges primarily include fair value adjustments to the acquired inventory included in the acquisition-date balance sheets, merger and integration charges and costs associated with divestitures. Merger and integration charges include liabilities to support socioeconomic programs in South Africa, closing costs, employee-related costs, gains associated with contingent consideration, contract termination costs and other integration costs.

A - 5

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Pension and retiree medical-related impact

Pension and retiree medical-related impact primarily includes settlement charges related to lump sum distributions exceeding the total of annual service and interest costs, as well as curtailment gains related to plan changes.

Charge related to cash tender offers

As a result of the cash tender offers for some of our long-term debt, we recorded a charge primarily representing the tender price paid over the carrying value of the tendered notes and loss on treasury rate locks used to mitigate the interest rate risk on the cash tender offers.

Tax expense related to the TCJ Act

Tax expense related to the TCJ Act reflects adjustments to the mandatory transition tax liability under the TCJ Act.

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.

Organic revenue growth: A measure that adjusts for the impacts of foreign exchange translation, acquisitions and divestitures, and where applicable, the impact of an additional week of results every five or six years (53rd reporting week), including in our 2022 financial results. Adjusting for acquisitions and divestitures reflects mergers and acquisitions activity, including the impact, in the year ended December 25, 2021, of an extra month of net revenue for our acquisitions of Pioneer Foods in our Africa, Middle East and South Asia division and Be & Cheery in our Asia Pacific, Australia and New Zealand and China Region division as we aligned the reporting calendars of these acquisitions with those of our divisions, as well as divestitures and other structural changes, including changes in ownership or control in consolidated subsidiaries and nonconsolidated equity investees. We believe organic revenue growth provides useful information in evaluating the results of our business because it excludes items that we believe are not indicative of ongoing performance or that we believe impact comparability with the prior year.

2022 guidance and long-term organic revenue target

Our 2022 organic revenue growth guidance and our long-term organic revenue growth target exclude the impact of acquisitions, divestitures and other structural changes, the impact of the 53rd reporting week and foreign exchange translation. Our 2022 core effective tax rate guidance and our 2022 core constant currency EPS growth guidance exclude the mark-to-market net impact included in corporate unallocated expenses and restructuring and impairment charges. Our 2022 core constant currency EPS growth guidance also excludes the impact of foreign exchange translation. We are unable to reconcile our full year projected 2022 or our long-term organic revenue growth to our full year projected 2022 and long-term reported net revenue growth because we are unable to predict the 2022 and long-term impact of foreign exchange due to the unpredictability of future changes in foreign exchange rates and because we are unable to predict the occurrence or impact of any acquisitions, divestitures or other structural changes. We are also not able to reconcile our full year projected 2022 core effective tax rate to our full year projected 2022 reported effective tax rate and our full year projected 2022 core constant currency EPS growth to our full year projected 2022 reported EPS growth because we are unable to predict the 2022 impact of foreign exchange or the mark-to-market net impact on commodity derivatives due to the unpredictability of future changes in foreign exchange rates and commodity prices. Therefore, we are unable to provide a reconciliation of these measures.

A - 6

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PepsiCo, Inc. and Subsidiaries

Reconciliation of GAAP and Non-GAAP Information

Organic Revenue Growth Rates

Quarter and Year Ended December 25, 2021

(unaudited)

			Quarter Ended 12/25/2021
									Impact of																		Impact of
Net Revenue Year over Year % Change			Reported % Change, GAAP Measure						Foreign exchange translation						Acquisitions and divestitures(a)												Organic % Change, Non-GAAP Measure(b)						Organic volume(c)						Effective net pricing
Frito-Lay North America			13		%				—						—												13		%				4.5						9
Quaker Foods North America			9		%				—						—												9		%				(2)						11
PepsiCo Beverages North America			13		%				—						—												12		%				6						6
Latin America			16		%				1						—												17		%				6						11
Europe			8		%				1						—												9		%				1						8
Africa, Middle East and South Asia			13		%				(1)						(4)												8		%				5						2
Asia Pacific, Australia and New Zealand and China Region			18		%				(2)						(3)												13		%				16						(2)
Total			12		%				—						(0.5)												12		%				5						7

			Year Ended 12/25/2021
									Impact of																		Impact of
Net Revenue Year over Year % Change			Reported % Change, GAAP Measure						Foreign exchange translation						Acquisitions and divestitures(a)												Organic % Change, Non-GAAP Measure(b)						Organic volume(c)						Effective net pricing
Frito-Lay North America			8		%				(0.5)						—												7		%				2						5
Quaker Foods North America			—		%				(1)						—												—		%				(7)						7
PepsiCo Beverages North America			12		%				(0.5)						(1)												10		%				5						5
Latin America			17		%				(2)						—												15		%				4						10
Europe			9		%				(0.5)						—												9		%				4.5						4
Africa, Middle East and South Asia			33		%				(4.5)						(17)												12		%				7						4
Asia Pacific, Australia and New Zealand and China Region			34		%				(6)						(15)												13		%				12						1
Total			13		%				(1)						(2)												10		%				4						5

(a)Adjustments primarily reflect Rockstar Energy Beverages (Rockstar) (PepsiCo Beverages North America), Pioneer Foods (Africa, Middle East and South Asia), and Be & Cheery (Asia Pacific, Australia and New Zealand and China Region). The contribution from the acquisition of Rockstar reflects the incremental consolidated net revenue reported for Rockstar in excess of the net revenue we reported under our previous distribution arrangement.

(b)A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.

(c)Excludes the impact of acquisitions and divestitures, including the impact, in the year ended December 25, 2021, of an extra month of volume for our acquisitions of Pioneer Foods in our Africa, Middle East and South Asia division and Be & Cheery in our Asia Pacific, Australia and New Zealand and China Region division as we aligned the reporting calendars of these acquisitions with those of our divisions. In certain instances, the impact of organic volume growth on net revenue growth differs from the unit volume change disclosed in the Summary Fourth-Quarter 2021 Performance and Summary Full-Year 2021 Performance tables on pages 3 and 6, respectively, due to product mix, nonconsolidated joint venture volume, and, for our beverage businesses, temporary timing differences between BCS and CSE. Our net revenue excludes nonconsolidated joint venture volume, and, for our franchise-owned beverage businesses, is based on CSE.

Note – Amounts may not sum due to rounding.

A - 7

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PepsiCo, Inc. and Subsidiaries

Reconciliation of GAAP and Non-GAAP Information (continued)

Year over Year Growth Rates

Quarter and Year Ended December 25, 2021 (unaudited)

			Quarter Ended 12/25/2021
									Impact of Items Affecting Comparability																																							Impact of
Year over Year % Change			Reported % Change, GAAP Measure						Mark-to-market net impact						Restructuring and impairment charges						Acquisition and divestiture-related charges												Pension and retiree medical-related impact												Charge related  to cash tender offers																								Core % Change, Non-GAAP Measure(a)						Foreign exchange translation						Core Constant Currency % Change, Non-GAAP Measure(a)
Frito-Lay North America			10		%				—						(5)						—												—												—																								5		%				—						5		%
Quaker Foods North America			8		%				—						(2)						—												—												—																								6		%				—						6		%
PepsiCo Beverages North America			(10)		%				—						(8)						9												—												—																								(9)		%				—						(9)		%
Latin America			21		%				—						(1)						—												—												—																								19		%				—						20		%
Europe			(16)		%				—						5						2												—												—																								(9)		%				(1)						(10)		%
Africa, Middle East and South Asia			(29)		%				—						—						—												—												—																								(29)		%				(2)						(31)		%
Asia Pacific, Australia and New Zealand and China Region			(25)		%				—						6						(2)												—												—																								(21)		%				4						(17)		%
Corporate unallocated expenses			70		%				(47)						(4)						(3)												—												—																								17		%				—						17		%
Total Operating Profit			(9)		%				6						(1)						1												—												—																								(4)		%				—						(4)		%
Net Income Attributable to PepsiCo			(28)		%				7						(2)						(1)												(8)												36																								4		%				—						4		%
Net Income Attributable to PepsiCo per common share – diluted			(28)		%				7						(2)						(1)												(8)												36																								4		%				—						4		%

			Year Ended 12/25/2021
									Impact of Items Affecting Comparability																																													Impact of
Year over Year % Change			Reported % Change, GAAP Measure						Mark-to-market net impact						Restructuring and impairment charges						Acquisition and divestiture-related charges						Pension and retiree medical-related impact												Charge related  to cash tender offers						Tax expense related to the TCJ Act																								Core % Change, Non-GAAP Measure(a)						Foreign exchange translation						Core Constant Currency % Change, Non-GAAP Measure(a)
Frito-Lay North America			5.5		%				—						(1)						(0.5)						—												—						—																								4		%				—						3		%
Quaker Foods North America			(14)		%				—						(0.5)						—						—												—						—																								(14)		%				—						(14)		%
PepsiCo Beverages North America			26		%				—						(2)						(4)						—												—						—																								21		%				(1)						20		%
Latin America			33		%				—						—						—						—												—						—																								32		%				(4.5)						28		%
Europe			(4.5)		%				—						2.5						1						—												—						—																								(1.5)		%				(1.5)						(3)		%
Africa, Middle East and South Asia			43		%				—						—						(31)						—												—						—																								12		%				(2)						10		%
Asia Pacific, Australia and New Zealand and China Region			14		%				—						1						(1.5)						—												—						—																								14		%				(3)						10		%
Corporate unallocated expenses			17		%				(7)						(1)						1						—												—						—																								10		%				—						10		%
Total Operating Profit			11		%				1						—						(3)						—												—						—																								8		%				(1)						7		%
Net Income Attributable to PepsiCo			7		%				1						—						(3)						(2)												8						2																								13		%				(1.5)						11		%
Net Income Attributable to PepsiCo per common share – diluted			7		%				1						—						(3)						(2)												8						2																								13		%				(1.5)						12		%

(a)A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.

Note – Amounts may not sum due to rounding.

A - 8

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PepsiCo, Inc. and Subsidiaries

Reconciliation of GAAP and Non-GAAP Information (continued)

Certain Line Items

Quarters Ended December 25, 2021 and December 26, 2020

(in millions except per share amounts, unaudited)

			Quarter Ended 12/25/2021
			Cost of sales						Gross profit						Selling, general and administrative expenses												Operating profit						Other pension and retiree medical benefits income						Net interest expense and other						Provision for income taxes(b)						Net income attributable to noncontrolling interests						Net income attributable to PepsiCo						Net income attributable to PepsiCo per common share - diluted						Effective tax rate(c)
Reported, GAAP Measure			$	12,130					$	13,118					$	10,556											$	2,562					$	158					$	(1,132)					$	247					$	19					$	1,322					$	0.95					15.5		%
Items Affecting Comparability
Mark-to-market net impact			(60)						60						(20)												80						—						—						18						—						62						0.04						0.2
Restructuring and impairment charges			(16)						16						(98)												114						4						—						21						1						96						0.07						—
Acquisition and divestiture-related charges			—						—						16												(16)						—						—						23						—						(39)						(0.03)						1.7
Pension and retiree medical-related impact			—						—						—												—						12						—						1						—						11						0.01						(0.1)
Charge related to cash tender offers			—						—						—												—						—						842						165						—						677						0.49						0.8
Core, Non-GAAP Measure (a)			$	12,054					$	13,194					$	10,454											$	2,740					$	174					$	(290)					$	475					$	20					$	2,129					$	1.53					18.1		%

			Quarter Ended 12/26/2020
			Cost of sales						Gross profit						Selling, general and administrative expenses						Operating profit						Other pension and retiree medical benefits (expense)/income						Provision for income taxes(b)																		Net income attributable to PepsiCo						Net income attributable to PepsiCo per common share - diluted						Effective tax rate(c)
Reported, GAAP Measure			$	10,426					$	12,029					$	9,203					$	2,826					$	(130)					$	498																	$	1,845					$	1.33					21.2		%
Items Affecting Comparability
Mark-to-market net impact			50						(50)						49						(99)						—						(23)																		(76)						(0.05)						(0.1)
Restructuring and impairment charges			(26)						26						(127)						153						12						35																		130						0.09						—
Acquisition and divestiture-related charges			(2)						2						33						(31)						—						(14)																		(17)						(0.01)						(0.3)
Pension and retiree medical-related impact			—						—						—						—						205						47																		158						0.11						0.2
Core, Non-GAAP Measure (a)			$	10,448					$	12,007					$	9,158					$	2,849					$	87					$	543																	$	2,040					$	1.47					20.9		%

(a)A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.

(b)Provision for income taxes is the expected tax charge/benefit on the underlying item based on the tax laws and income tax rates applicable to the underlying item in its corresponding tax jurisdiction.

(c)The impact of items affecting comparability on our effective tax rate represents the difference in the effective tax rate resulting from a higher or lower tax rate applicable to the items affecting comparability.

Note – Certain amounts may not sum due to rounding.

A - 9

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PepsiCo, Inc. and Subsidiaries

Reconciliation of GAAP and Non-GAAP Information (continued)

Certain Line Items

Years Ended December 25, 2021 and December 26, 2020

(in millions except per share amounts, unaudited)

			Year Ended 12/25/2021
			Cost of sales						Gross profit						Selling, general and administrative expenses						Operating profit												Other pension and retiree medical benefits income						Net interest expense and other						Provision for income taxes(b)						Net income attributable to noncontrolling interests						Net income attributable to PepsiCo						Net income attributable to PepsiCo per common share - diluted						Effective tax rate(c)
Reported, GAAP Measure			$	37,075					$	42,399					$	31,237					$	11,162											$	522					$	(1,863)					$	2,142					$	61					$	7,618					$	5.49					21.8		%
Items Affecting Comparability
Mark-to-market net impact			(39)						39						20						19												—						—						5						—						14						0.01						—
Restructuring and impairment charges			(29)						29						(208)						237												10						—						41						1						205						0.15						(0.1)
Acquisition and divestiture-related charges			(1)						1						5						(4)												—						—						23						—						(27)						(0.02)						0.2
Pension and retiree medical-related impact			—						—						—						—												12						—						1						—						11						0.01						—
Charge related to cash tender offers			—						—						—						—												—						842						165						—						677						0.49						—
Tax expense related to the TCJ Act			—						—						—						—												—						—						(190)						—						190						0.14						(1.9)
Core, Non-GAAP Measure (a)			$	37,006					$	42,468					$	31,054					$	11,414											$	544					$	(1,021)					$	2,187					$	62					$	8,688					$	6.26					20.0		%

			Year Ended 12/26/2020
			Cost of sales						Gross profit						Selling, general and administrative expenses						Operating profit						Other pension and retiree medical benefits income						Provision for income taxes(b)												Net income attributable to PepsiCo						Net income attributable to PepsiCo per common share - diluted						Effective tax rate(c)
Reported, GAAP Measure			$	31,797					$	38,575					$	28,495					$	10,080					$	117					$	1,894											$	7,120					$	5.12					20.9		%
Items Affecting Comparability
Mark-to-market net impact			64						(64)						9						(73)						—						(15)												(58)						(0.04)						—
Restructuring and impairment charges			(30)						30						(239)						269						20						58												231						0.17						—
Acquisition and divestiture-related charges			(32)						32						(223)						255						—						18												237						0.17						(0.4)
Pension and retiree medical-related impact			—						—						—						—						205						47												158						0.11						—
Core, Non-GAAP Measure (a)			$	31,799					$	38,573					$	28,042					$	10,531					$	342					$	2,002											$	7,688					$	5.52					20.5		%

(a)A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.

(b)Provision for income taxes is the expected tax charge/benefit on the underlying item based on the tax laws and income tax rates applicable to the underlying item in its corresponding tax jurisdiction.

(c)The impact of items affecting comparability on our effective tax rate represents the difference in the effective tax rate resulting from a higher or lower tax rate applicable to the items affecting comparability.

Note – Certain amounts may not sum due to rounding.

A - 10

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PepsiCo, Inc. and Subsidiaries

Reconciliation of GAAP and Non-GAAP Information (continued)

Operating Profit by Division

Quarters Ended December 25, 2021 and December 26, 2020

(in millions, unaudited)

			Quarter Ended 12/25/2021
									Items Affecting Comparability
Operating Profit			Reported, GAAP Measure						Mark-to-market net impact						Restructuring and impairment charges						Acquisition and divestiture-related charges												Core, Non-GAAP Measure(a)
Frito-Lay North America			$	1,654					$	—					$	8					$	—											$	1,662
Quaker Foods North America			194						—						(1)						—												193
PepsiCo Beverages North America			494						—						12						9												515
Latin America			402						—						15						—												417
Europe			317						—						35						8												360
Africa, Middle East and South Asia			152						—						6						2												160
Asia Pacific, Australia and New Zealand and China Region			72						—						5						1												78
Corporate unallocated expenses			(723)						80						34						(36)												(645)
Total			$	2,562					$	80					$	114					$	(16)											$	2,740

			Quarter Ended 12/26/2020
									Items Affecting Comparability
Operating Profit			Reported, GAAP Measure						Mark-to-market net impact						Restructuring and impairment charges						Acquisition and divestiture-related charges						Core, Non-GAAP Measure(a)
Frito-Lay North America			$	1,507					$	—					$	74					$	3					$	1,584
Quaker Foods North America			178						—						4						—						182
PepsiCo Beverages North America			546						—						15						6						567
Latin America			333						—						17						—						350
Europe			376						—						19						—						395
Africa, Middle East and South Asia			214						—						5						4						223
Asia Pacific, Australia and New Zealand and China Region			96						—						1						2						99
Corporate unallocated expenses			(424)						(99)						18						(46)						(551)
Total			$	2,826					$	(99)					$	153					$	(31)					$	2,849

(a)A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.

A - 11

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PepsiCo, Inc. and Subsidiaries

Reconciliation of GAAP and Non-GAAP Information (continued)

Operating Profit by Division

Years Ended December 25, 2021 and December 26, 2020

(in millions, unaudited)

			Year Ended 12/25/2021
									Items Affecting Comparability
Operating Profit			Reported, GAAP Measure						Mark-to-market net impact						Restructuring and impairment charges						Acquisition and divestiture-related charges												Core, Non-GAAP Measure(a)
Frito-Lay North America			$	5,633					$	—					$	28					$	2											$	5,663
Quaker Foods North America			578						—						—						—												578
PepsiCo Beverages North America			2,442						—						20						11												2,473
Latin America			1,369						—						37						—												1,406
Europe			1,292						—						81						8												1,381
Africa, Middle East and South Asia			858						—						15						10												883
Asia Pacific, Australia and New Zealand and China Region			673						—						7						4												684
Corporate unallocated expenses			(1,683)						19						49						(39)												(1,654)
Total			$	11,162					$	19					$	237					$	(4)											$	11,414

			Year Ended 12/26/2020
									Items Affecting Comparability
Operating Profit			Reported, GAAP Measure						Mark-to-market net impact						Restructuring and impairment charges						Acquisition and divestiture-related charges						Core, Non-GAAP Measure(a)
Frito-Lay North America			$	5,340					$	—					$	83					$	29					$	5,452
Quaker Foods North America			669						—						5						—						674
PepsiCo Beverages North America			1,937						—						47						66						2,050
Latin America			1,033						—						31						—						1,064
Europe			1,353						—						48						—						1,401
Africa, Middle East and South Asia			600						—						14						173						787
Asia Pacific, Australia and New Zealand and China Region			590						—						5						7						602
Corporate unallocated expenses			(1,442)						(73)						36						(20)						(1,499)
Total			$	10,080					$	(73)					$	269					$	255					$	10,531

(a)A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.

A - 12

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PepsiCo, Inc. and Subsidiaries

Reconciliation of GAAP and Non-GAAP Information (continued)

(unaudited)

Gross Margin Performance Reconciliation

			Quarter Ended									Year Ended
			12/25/2021									12/25/2021
Reported gross margin performance, GAAP measure			(161)			bps						(147)			bps
Mark-to-market net impact			46									14
Restructuring and impairment charges			(5)									(1)
Acquisition and divestiture-related charges			(1)									(4)
Core gross margin performance, non-GAAP measure (a)			(122)			bps						(138)			bps

Operating Margin Performance Reconciliation

			Quarter Ended									Year Ended
			12/25/2021									12/25/2021
Reported operating margin performance, GAAP measure			(244)			bps						(28)			bps
Mark-to-market net impact			76									13
Restructuring and impairment charges			(23)									(8)
Acquisition and divestiture-related charges			8									(37)
Core operating margin performance, non-GAAP measure (a)			(183)			bps						(60)			bps

(a)A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.

Note – Certain amounts may not sum due to rounding.

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Cautionary Statement

Statements in this communication that are “forward-looking statements,” including our 2022 guidance and long-term targets, 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,” “goal,” “guidance,” “intend,” “may,” “objective,” “outlook,” “plan,” “position,” “potential,” “project,” “seek,” “should,” “strategy,” “target,” “will” or similar statements or variations of such words and other similar expressions 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: the impact of COVID-19; future demand for PepsiCo’s products; damage to PepsiCo’s reputation or brand image; product recalls or other issues or concerns with respect to product quality and safety; PepsiCo’s ability to compete effectively; PepsiCo’s ability to attract, develop and maintain a highly skilled and diverse workforce; water scarcity; changes in the retail landscape or in sales to any key customer; disruption of PepsiCo’s manufacturing operations or supply chain, including increased commodity, packaging, transportation, labor and other input costs; political or social conditions in the markets where PepsiCo’s products are made, manufactured, distributed or sold; PepsiCo’s ability to grow its business in developing and emerging markets; changes in economic conditions in the countries in which PepsiCo operates; future cyber incidents and other disruptions; failure to successfully complete or manage strategic transactions; PepsiCo’s reliance on third-party service providers and enterprise-wide systems; climate change or measures to address climate change; strikes or work stoppages; failure to realize benefits from PepsiCo’s productivity initiatives; deterioration in estimates and underlying assumptions regarding future performance that can result in an impairment charge; fluctuations or other changes in exchange rates; any downgrade or potential downgrade of PepsiCo’s credit ratings; imposition or proposed imposition of new or increased taxes aimed at PepsiCo’s products; imposition of limitations on the marketing or sale of PepsiCo’s products; changes in laws and regulations related to the use or disposal of plastics or other packaging materials; failure to comply with personal data protection and privacy laws; increase in income tax rates, changes in income tax laws or disagreements with tax authorities; failure to adequately protect PepsiCo’s intellectual property rights or infringement on intellectual property rights of others; failure to comply with applicable laws and regulations; and potential liabilities and costs from litigation, claims, legal or regulatory proceedings, inquiries or investigations.

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. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.

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