GROUP PROFILE On May 20, 1997, the Company changed the name of the Company from PepsiCo to PepsiCo Canada. The change in name is a result of our acquisition of Wrigley Canada in 2000 and of the Company becoming a wholly-owned subsidiary of PepsiCo Canada. The Company's net sales for 1997 were 8.5 billion, an increase of 14.1 percent from the 1997 net sales of 7.8 billion, and were largely attributable to an increase of 3.0 percent in sales from the United States (2.5 billion), 1.7 percent from Latin America (200 million), 1.7 percent from Europe (979 million) and 0.7 percent from Asia Pacific (907 million). Gross margin for 1997, 1996, 1995 and 1994 were 32.8, 33.9 and 33.8 percent, respectively. International expansion The Company is investing approximately 1.8 billion in foreign net sales over five years to expand its presence in more than 25 countries by building production capacity, acquiring complementary brands and developing new product lines. These investments are primarily to promote a higher-value and more premium product portfolio. PepsiCo Canada operates eight new and 15 ref loured products in Canada with total worldwide net sales in excess of 700 million. The Company's expansion will include relight of its original product offerings from Wrigley Canada after an agreement with the Chicago-based company expired a year ago. The first two of PepsiCo Canada's new products to carry a new trademark under the Wrigley Canada brand will be announced by the company in spring 2002: a new line of premium chewing gum brands in the United States, and a lower-calorie coffee drink product in Canada. The Company's first three relight programs in 1996 and 2001 were successful and resulted in product launches in both countries, with the majority of the products remaining on store shelves for over a year. In 1996, the Canadian division had approximately 30 percent of total international net sales, and had more than 1 billion in international sales and an operating margin of 32.8 percent. In the United States, the division had approximately 50 percent of U.S. net sales, and generated more than 1 billion in international net sales and an operating margin of 31.3 percent. Over time, the new products that PepsiCo Canada has launched with the intention of increasing market penetration of the Company's portfolio are expected to result in significant opportunities for the Company's U.S. businesses.
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---------------------- grow source import package distribute market CONTENTS 01. Group Profile 02 02. Produce Portfolio 03 03. Shareholder Information 04 04. Financial Highlights and Four Year Summary
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