Reconciliation of GAAP and Non-GAAP Information

The financial measures listed below are not measures defined by generally accepted accounting principles. However, we believe investors should consider these measures as they are more indicative of our ongoing performance and with how management evaluates our operational results and trends. Specifically, investors should consider the following:

Our 2008 and 2007 division operating profit and total operating profit excluding the impact of restructuring and impairment charges (including, for 2008, charges associated with our Productivity for Growth initiatives); 2008 and 2007 total operating profit excluding the mark-to-market net impact on commodity hedges; and our 2008 division operating growth and total operating profit growth excluding the impact of the aforementioned items;
Our 2008 net income and diluted EPS excluding the impact of restructuring and impairment charges (including, for 2008, charges associated with our Productivity for Growth initiatives), mark-to-market net losses on commodity hedges, and our share of PBG’s restructuring and impairment charges; our 2007 net income and diluted EPS excluding the impact of restructuring and impairment charges, mark-to-market net gains on commodity hedges and certain tax benefits; our 2008 net income and diluted EPS growth excluding the impact of the aforementioned items; and our 2006 diluted EPS excluding the impact of restructuring and impairment charges, mark-to-market net losses on commodity hedges and certain tax benefits; and
Our 2008 return on invested capital (ROIC) excluding the impact of restructuring and impairment charges (including, for 2008, charges associated with our Productivity for Growth initiatives), mark-to-market net impact on commodity hedges, our share of PBG’s restructuring and impairment charges and certain tax benefits.

Operating Profit Reconciliation


		2008		2007		Growth
Total PepsiCo Reported Operating Profit	$	6,935	$	7,170		(3	)%
Impact of Mark-to-Market Net Losses/(Gains) on Commodity Hedges		346		(19	)
Impact of Restructuring and Impairment Charges		543		102
Total Operating Profit Excluding above Items		7,824		7,253		8	%
Impact of Other Corporate Unallocated		651		772
PepsiCo Total Division Operating Profit Excluding above Items	$	8,475	$	8,025		6	%

Net Income Reconciliation


		2008		2007		Growth
Reported Net Income	$	5,142	$	5,658		(9	)%
Impact of Mark-to-Market Net Losses/(Gains) on Commodity Hedges		223		(12	)
Impact of Restructuring and Impairment Charges		408		70
Impact of PBG Restructuring and Impairment Charges		114
Impact of Tax Benefits		–		(129	)
Net Income Excluding above Items	$	5,887	$	5,587		5	%

Diluted EPS Reconciliation


		2008			2007		2008 Growth			2006
Reported Diluted EPS	$	3.21		$	3.41		(6	)%	$	3.34
Impact of Mark-to-Market Net Losses/(Gains) on Commodity Hedges		0.14			(0.01	)				0.01
Impact of Restructuring and Impairment Charges		0.25			0.04					0.03
Impact of PBG’s Restructuring and Impairment Charges		0.07
Impact of Tax Benefits		–			(0.08	)				(0.37	)
Diluted EPS Excluding above Items	$	3.68	*	$	3.37	*	9	%	$	3.01

* Does not sum due to rounding

2008 Operating Profit Growth Reconciliation


	PepsiCo Americas Foods		PepsiCo Americas Beverages		PepsiCo International
Reported Operating Profit Growth	8	%	(19	)%	13	%
Impact of Restructuring and Impairment Charges	3		11		3
Operating Profit Growth Excluding above Items	10	%*	(7	)%*	16	%

* Does not sum due to rounding

ROIC Reconciliation


	2008
Reported ROIC	26	%
Impact of Mark-to-Market Net Impact on Commodity Hedges	1
Impact of Restructuring and Impairment Charges	2
Impact of PBG’s Restructuring and Impairment Charges	1
Impact of Tax Benefits	(0.5	)
ROIC Excluding above Items	29	%*

* Does not sum due to rounding