PRESIDENT OF PEPSICO.

I N D R A

N O O Y I

About Pepsi co.

• PepsiCo offers the world’s largest portfolio of billion-dollar food and beverage brands.

• It includes 19 different product lines that each generates more than $1 billion in annual retail sales.

• Its main businesses — Frito-Lay, Quaker, Pepsi, Tropicana & aliva.

• We have consumers having nourished food and elite drinks in more than 200 countries.

• PepsiCo’s people are united by our unique commitment to sustainable growth, called “Performance with Purpose.

To All Our Investors…

Our Goals and Commitments…

TOP line :

• Grow international revenues at two times real global GDP growth rate.

• Grow savory snack and liquid refreshment beverage market share in the top 20 markets.

Bottom Line

• continue to expand division operating margins.

• increase cash flow in proportion to net income growth over three-years.

• deliver total shareholder returns in the top quartile of our industry group.

To the People of the

World….

Products:• increase the amount of whole grains, fruits,

vegetables, nuts, seeds and low-fat dairy in the global product portfolio.

• reduce the average amount of saturated fat per serving in key global food brands by 15 percent.

• reduce the average amount of added sugar per serving in key global beverage brands by 25 percent.

Our Goals and Commitments..

• display calorie count and key nutrients on our food and beverage packaging by 2012.

• advertise to children under 12 only products that meet our global science-based nutrition standards.

Market Place

• To expand Pepsico Foundation and Pepsico corporate contribution initiatives to promote healthier communities.

• To integrate our policies and actions on human health, agriculture and the environment to make sure that they support each other.

community

To the planet we all

SHARE

Our Goals and Commitments

WATER

• Strive for positive water balance in our operations in water-distressed areas.

• Provide access to safe water to three million people in developing

countries by the end of 2015.

•

land and Packaging

• create partnerships that promote the increase of U.S. beverage container recycling rates to 50 percent by 2018.

• reduce packaging weight by 350 million pounds—avoiding the creation of one billion pounds of landfill waste by 2012.

• improve our electricity use efficiency by 20 percent per unit of production by 2015.

• reduce our fuel use intensity by 25 percent per unit of production by 2015.

Climate change

• apply proven sustainable agricultural practices on our farmed land.

• Provide funding, technical support and training to local farmers.

• Promote environmental education and best practices among our associates and business partners.

community

To the associates of PepsiCo…

Our Goals and Commitments

Career

• become universally recognized through top rankings of the world for leadership development.

• create a work environment in organization. ( skills, talents etc)

community

• create local jobs by expanding operations in developing countries.

• Support education through Pepsico Foundation grants.

What is Performance with Purpose ????

• Performance with Purpose means that we will continue to bring together what is good for society and what is good for business.

• It encourages to think globally while acting locally.

WHY THIS MOTTO ?????

• The Performance with Purpose initiatives are taken to showcase in 2009 year’s annual report to demonstrate that what’s right for society and also what’s right for business.

Q1.

Net Income for 2008 was $5,142 million, but Cash and Cash Equivalents increased only $1,154 million. Why is there such a difference between the company’s reported earnings and its net cash flow?

Asia’s situation

• In Russia ,China Net revenue grew 17%, reflecting. favorable effective net pricing and volume growth

• Acquisitions contributed 7 percentage points and foreign currency contributed 2 percentage points to the net revenue growth.

Middle east situation

• In middle east and south africa

Net revenue grew 23%, reflecting volume growth and favorable effective net pricing.

• Acquisitions contributed 2 percentage points and foreign currency contributed 1 percentage point to the net revenue growth.

• Income purpose with performance motto & large product line in middle east lead

• Cash equi. Didn’t increase because they were into sustainable development so they coudnt create much of cash equivalent assets.

and cash equi. Assets readily convertible into liquid cash.

Q2.

The “book value” of the company was $7.86 a share at the end of 2008. The “market value” of the shares at year end was $54.56 a share. Why are these two values so different?

• Share prices increased in the market terms because

- they were going in loss due to purpose with performance motto

- they had to earn the revenues which was only possible by increasing the prices of the shares

- they coudnt increase the price of the products because it would effect their sales.