Restructuring, Impairment and Integration Charges

In the 12 weeks ended June 15, 2013, we incurred restructuring and impairment charges of $19 million ($15 million after-tax or $0.01 per share) in conjunction with our multi-year productivity plan (Productivity Plan). In the 24 weeks ended June 15, 2013, we incurred restructuring and impairment charges of $30 million ($23 million after-tax or $0.01 per share) in conjunction with our Productivity Plan. All of these net charges were recorded in selling, general and administrative expenses. The majority of cash payments related to these charges are expected to be paid by the end of 2013.

In the 12 weeks ended June 16, 2012, we incurred restructuring and impairment charges of $77 million ($57 million after-tax or $0.04 per share) in conjunction with our Productivity Plan. In the 24 weeks ended June 16, 2012, we incurred restructuring and impairment charges of $110 million ($80 million after-tax or $0.05 per share) in conjunction with our Productivity Plan. All of these net charges were recorded in selling, general and administrative expenses. All cash payments related to these charges were paid by the end of 2012.

The Productivity Plan includes actions in every aspect of our business that we believe will strengthen our complementary food, snack and beverage businesses by leveraging new technologies and processes across PepsiCo’s operations, go-to-market and information systems; heightening the focus on best practice sharing across the globe; consolidating manufacturing, warehouse and sales facilities; and implementing simplified organization structures, with wider spans of control and fewer layers of management. The Productivity Plan is expected to enhance PepsiCo’s cost-competitiveness, provide a source of funding for future brand-building and innovation initiatives, and serve as a financial cushion for potential macroeconomic uncertainty.

A summary of our Productivity Plan charges is as follows:



	12 Weeks Ended				24 Weeks Ended
	6/15/13		6/16/12		6/15/13		6/16/12
FLNA	$	2	$	24	$	4	$	32
QFNA	1		1		—		6
LAF	1		6		5		12
PAB	5		35		5		43
Europe ^(a)	8		—		12		(1		)
AMEA	1		8		2		17
Corporate	1		3		2		1
	$	19	$	77	$	30	$	110


(a)	Income balance represents adjustments of previously recorded amounts.

A summary of our Productivity Plan activity in 2013 is as follows:



	Severance and Other Employee Costs			Asset Impairment			Other Costs			Total
Liability as of December 29, 2012	$	91		$	—		$	36		$	127
2013 restructuring charges	11			1			18			30
Cash payments	(50		)	—			(24		)	(74		)
Non-cash charges and other	(5		)	(1		)	(5		)	(11		)
Liability as of June 15, 2013	$	47		$	—		$	25		$	72

In the 12 weeks ended June 15, 2013, we recorded income for merger and integration of $1 million ($1 million after-tax with a nominal amount per share) related to our acquisition of Wimm-Bill-Dann Foods OJSC (WBD). This income was recorded in selling, general and administrative expenses in the Europe segment representing adjustments of previously recorded amounts. In the 24 weeks ended June 15, 2013, merger and integration charges were nominal. Cash payments related to these charges are expected to be paid by the end of 2013.

In the 12 weeks ended June 16, 2012, we incurred merger and integration charges of $3 million ($2 million after-tax with a nominal amount per share) related to our acquisition of WBD, including $1 million recorded in the Europe segment and $2 million recorded in corporate unallocated expenses. In the 24 weeks ended June 16, 2012, we incurred merger and integration charges of $5 million ($4 million after-tax with a nominal amount per share) related to our acquisition of WBD, including $3 million recorded in the Europe segment and $2 million recorded in corporate unallocated expenses. These charges were recorded in selling, general and administrative expenses. Cash payments related to these charges were paid out by the end of 2012.

A summary of our merger and integration activity in 2013 is as follows:



	Severance and Other Employee Costs			Other Costs			Total
Liability as of December 29, 2012	$	18		$	6		$	24
2013 merger and integration charges ^(a)	(2		)	2			—
Cash payments	(13		)	(4		)	(17		)
Non-cash charges and other	(1		)	—			(1		)
Liability as of June 15, 2013	$	2		$	4		$	6


(a)	Income balance represents adjustments of previously recorded amounts.