10-Q
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
X
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 5, 2015 (36 weeks)
OR
 
    
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from            to             
Commission file number 1-1183
 
PepsiCo, Inc.
(Exact Name of Registrant as Specified in its Charter)
 
 
 
 
North Carolina
  
13-1584302
(State or Other Jurisdiction of
Incorporation or Organization)
  
(I.R.S. Employer
Identification No.)
 
 
700 Anderson Hill Road, Purchase, New York
  
10577
(Address of Principal Executive Offices)
  
(Zip Code)

914-253-2000
(Registrant’s Telephone Number, Including Area Code)

N/A
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    YES   X    NO      
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    YES   X    NO      
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
 
Large accelerated filer  X 
  
Accelerated filer     
Non-accelerated filer     
(Do not check if a smaller reporting company)
  
Smaller reporting company     
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    YES           NO  X
Number of shares of Common Stock outstanding as of September 30, 2015 was 1,456,850,777.

Table of Contents    


PepsiCo, Inc. and Subsidiaries

Table of Contents
Part I Financial Information
Page No.
Item 1.
Condensed Consolidated Financial Statements
 
Condensed Consolidated Statement of Income –
12 and 36 Weeks Ended September 5, 2015 and September 6, 2014                                                                                                                 
 
Condensed Consolidated Statement of Comprehensive Income –
12 and 36 Weeks Ended September 5, 2015 and September 6, 2014
 
Condensed Consolidated Statement of Cash Flows –
36 Weeks Ended September 5, 2015 and September 6, 2014
 
Condensed Consolidated Balance Sheet –
September 5, 2015 and December 27, 2014
 
Condensed Consolidated Statement of Equity –
36 Weeks Ended September 5, 2015 and September 6, 2014
 
Item 2.
Report of Independent Registered Public Accounting Firm
Item 3.
Item 4.
Part II Other Information
 
Item 1.
Item 1A.
Item 2.
Item 5.
Other Information
Item 6.


2
Table of Contents    


PART I FINANCIAL INFORMATION
ITEM 1. Condensed Consolidated Financial Statements.

Condensed Consolidated Statement of Income
PepsiCo, Inc. and Subsidiaries
(in millions except per share amounts, unaudited) 
 
12 Weeks Ended
 
36 Weeks Ended
 
9/5/2015

 
9/6/2014

 
9/5/2015

 
9/6/2014

Net Revenue
$
16,331

 
$
17,218

 
$
44,471

 
$
46,735

Cost of sales
7,395

 
7,995

 
20,004

 
21,520

Gross profit
8,936

 
9,223

 
24,467

 
25,215

Selling, general and administrative expenses
6,143

 
6,354

 
16,942

 
17,600

Venezuela impairment charges
1,359

 
—

 
1,359

 
—

Amortization of intangible assets
18

 
22

 
53

 
65

Operating Profit
1,416

 
2,847

 
6,113

 
7,550

Interest expense
(225
)
 
(215
)
 
(653
)
 
(625
)
Interest income and other
2

 
23

 
31

 
51

Income before income taxes
1,193

 
2,655

 
5,491

 
6,976

Provision for income taxes
650

 
637

 
1,723

 
1,744

Net income
543

 
2,018

 
3,768

 
5,232

Less: Net income attributable to noncontrolling interests
10

 
10

 
34

 
30

Net Income Attributable to PepsiCo
$
533

 
$
2,008

 
$
3,734

 
$
5,202

Net Income Attributable to PepsiCo per Common Share
 
 
 
 
 
 
 
Basic
$
0.36

 
$
1.33

 
$
2.53

 
$
3.43

Diluted
$
0.36

 
$
1.32

 
$
2.50

 
$
3.40

Weighted-average common shares outstanding
 
 
 
 
 
 
 
Basic
1,467

 
1,507

 
1,475

 
1,515

Diluted
1,483

 
1,525

 
1,492

 
1,532

Cash dividends declared per common share
$
0.7025

 
$
0.655

 
$
2.06

 
$
1.8775

See accompanying notes to the condensed consolidated financial statements.


3
Table of Contents    


Condensed Consolidated Statement of Comprehensive Income
PepsiCo, Inc. and Subsidiaries
(in millions, unaudited) 
 
12 Weeks Ended 9/5/2015
 
36 Weeks Ended 9/5/2015
 
Pre-tax amounts

Tax amounts

After-tax amounts
 
Pre-tax amounts
 
Tax amounts
 
After-tax amounts
Net income


 


 
$
543

 
 
 
 
 
$
3,768

Other Comprehensive Loss
 
 
 
 
 
 
 
 
 
 
 
Currency translation:
 
 
 
 
 
 
 
 
 
 
 
Currency translation adjustment
$
(1,600
)
 
$
—

 
(1,600
)
 
$
(2,107
)
 
$
—

 
(2,107
)
Reclassification associated with Venezuelan entities
111

 
—

 
111

 
111

 
—

 
111

Cash flow hedges:
 
 
 
 
 
 
 
 
 
 
 
Reclassification of net losses to net income
6

 
(3
)
 
3

 
88

 
(40
)
 
48

Net derivative gains/(losses)
13

 
(1
)
 
12

 
(94
)
 
43

 
(51
)
Pension and retiree medical:
 
 
 
 
 
 
 
 
 
 
 
Reclassification of net losses to net income
58

 
(18
)
 
40

 
167

 
(53
)
 
114

Reclassification associated with Venezuelan entities
20

 
(4
)
 
16

 
20

 
(4
)
 
16

Remeasurement of net liabilities and translation
16

 
(5
)
 
11

 
31

 
(7
)
 
24

Unrealized losses on securities
(11
)
 
5

 
(6
)
 
(2
)
 
1

 
(1
)
Total Other Comprehensive Loss
$
(1,387
)
 
$
(26
)
 
(1,413
)
 
$
(1,786
)
 
$
(60
)
 
(1,846
)
Comprehensive (loss)/income
 
 
 
 
(870
)
 
 
 
 
 
1,922

Comprehensive income attributable to noncontrolling interests
 
 
 
 
(10
)
 
 
 
 
 
(33
)
Comprehensive (Loss)/Income Attributable to
PepsiCo
 
 
 
 
$
(880
)
 
 
 
 
 
$
1,889

 
12 Weeks Ended 9/6/2014
 
36 Weeks Ended 9/6/2014
 
Pre-tax amounts
 
Tax amounts
 
After-tax amounts
 
Pre-tax amounts
 
Tax amounts
 
After-tax amounts
Net income
 
 
 
 
$
2,018

 
 
 
 
 
$
5,232

Other Comprehensive Loss
 
 
 
 
 
 
 
 
 
 
 
Currency translation adjustment
$
(737
)
 
$
—

 
(737
)
 
$
(1,151
)
 
$
—

 
(1,151
)
Cash flow hedges:
 
 
 
 
 
 
 
 
 
 
 
Reclassification of net losses to net income
109

 
(37
)
 
72

 
130

 
(46
)
 
84

Net derivative losses
(42
)
 
16

 
(26
)
 
(67
)
 
23

 
(44
)
Pension and retiree medical:
 
 
 
 
 
 
 
 
 
 
 
Reclassification of net losses to net income
55

 
(18
)
 
37

 
156

 
(51
)
 
105

Remeasurement of net liabilities and translation
(10
)
 
5

 
(5
)
 
(20
)
 
8

 
(12
)
Unrealized losses on securities
(13
)
 
7

 
(6
)
 
(2
)
 
1

 
(1
)
Total Other Comprehensive Loss
$
(638
)
 
$
(27
)
 
(665
)
 
$
(954
)
 
$
(65
)
 
(1,019
)
Comprehensive income
 
 
 
 
1,353

 
 
 
 
 
4,213

Comprehensive income attributable to noncontrolling interests
 
 
 
 
(10
)
 
 
 
 
 
(30
)
Comprehensive Income Attributable to PepsiCo
 
 
 
 
$
1,343

 
 
 
 
 
$
4,183

See accompanying notes to the condensed consolidated financial statements.

4
Table of Contents    


Condensed Consolidated Statement of Cash Flows
PepsiCo, Inc. and Subsidiaries
(in millions, unaudited)
 
36 Weeks Ended
 
9/5/2015

 
9/6/2014

Operating Activities
 
 
 
Net income
$
3,768

 
$
5,232

Depreciation and amortization
1,644

 
1,794

Stock-based compensation expense
208

 
207

Restructuring and impairment charges
113

 
258

Cash payments for restructuring charges
(149
)
 
(169
)
Charge related to the transaction with Tingyi (Cayman Islands) Holding Corp.
   (Tingyi)

73

 
—

Venezuela impairment charges
1,359

 
—

Excess tax benefits from share-based payment arrangements
(85
)
 
(86
)
Pension and retiree medical plan expenses
326

 
368

Pension and retiree medical plan contributions
(165
)
 
(196
)
Deferred income taxes and other tax charges and credits
186

 
(8
)
Change in assets and liabilities:
 
 
 
Accounts and notes receivable
(1,553
)
 
(1,582
)
Inventories
(574
)
 
(481
)
Prepaid expenses and other current assets
(157
)
 
(18
)
Accounts payable and other current liabilities
1,014

 
537

Income taxes payable
1,002

 
1,115

Other, net
(235
)
 
(278
)
Net Cash Provided by Operating Activities
6,775

 
6,693

 
 
 
 
Investing Activities
 
 
 
Capital spending
(1,463
)
 
(1,540
)
Sales of property, plant and equipment
63

 
60

Acquisitions and investments in noncontrolled affiliates
(24
)
 
(81
)
Reduction of cash due to Venezuela deconsolidation
(568
)
 
—

Divestitures
75

 
186

Short-term investments, by original maturity:
 
 
 
More than three months - purchases
(2,391
)
 
(5,423
)
More than three months - maturities
3,005

 
—

Three months or less, net
—

 
117

Other investing, net
(3
)
 
3

Net Cash Used for Investing Activities
(1,306
)
 
(6,678
)
 

(Continued on following page)


5
Table of Contents    


Condensed Consolidated Statement of Cash Flows (continued)
PepsiCo, Inc. and Subsidiaries
(in millions, unaudited)
 
36 Weeks Ended
 
9/5/2015

 
9/6/2014

Financing Activities
 
 
 
Proceeds from issuances of long-term debt
$
5,719

 
$
3,364

Payments of long-term debt
(4,066
)
 
(2,186
)
Short-term borrowings, by original maturity:
 
 
 
More than three months - proceeds
13

 
32

More than three months - payments
(31
)
 
(10
)
Three months or less, net
1,431

 
2,117

Cash dividends paid
(3,008
)
 
(2,745
)
Share repurchases - common
(3,199
)
 
(3,207
)
Share repurchases - preferred
(3
)
 
(7
)
Proceeds from exercises of stock options
327

 
561

Excess tax benefits from share-based payment arrangements
85

 
86

Other financing
(26
)
 
(32
)
Net Cash Used for Financing Activities
(2,758
)
 
(2,027
)
Effect of exchange rate changes on cash and cash equivalents
(147
)
 
(81
)
Net Increase/(Decrease) in Cash and Cash Equivalents
2,564

 
(2,093
)
Cash and Cash Equivalents, Beginning of Year
6,134

 
9,375

Cash and Cash Equivalents, End of Period
$
8,698

 
$
7,282

See accompanying notes to the condensed consolidated financial statements.


6
Table of Contents    


Condensed Consolidated Balance Sheet
PepsiCo, Inc. and Subsidiaries
(in millions)
 
(Unaudited)
 
 
 
9/5/2015

 
12/27/2014

Assets
 
 
 
Current Assets
 
 
 
Cash and cash equivalents
$
8,698

 
$
6,134

Short-term investments
1,981

 
2,592

Accounts and notes receivable, less allowance: 9/15 - $140 and 12/14 - $137
7,666

 
6,651

Inventories:
 
 
 
Raw materials
1,410

 
1,593

Work-in-process
279

 
173

Finished goods
1,435

 
1,377

 
3,124

 
3,143

Prepaid expenses and other current assets
1,345

 
2,143

Total Current Assets
22,814

 
20,663

Property, Plant and Equipment
35,390

 
36,300

Accumulated Depreciation
(19,259
)
 
(19,056
)
 
16,131

 
17,244

Amortizable Intangible Assets, net
1,312

 
1,449

Goodwill
14,407

 
14,965

Other Nonamortizable Intangible Assets
12,081

 
12,639

Nonamortizable Intangible Assets
26,488

 
27,604

Investments in Noncontrolled Affiliates
2,285

 
2,689

Other Assets
872

 
860

Total Assets
$
69,902

 
$
70,509


 
(Continued on following page)

 

7
Table of Contents    


Condensed Consolidated Balance Sheet (continued)
PepsiCo, Inc. and Subsidiaries
(in millions except per share amounts)
 
(Unaudited)
 
 
 
9/5/2015

 
12/27/2014

Liabilities and Equity
 
 
 
Current Liabilities
 
 
 
Short-term obligations
$
5,525

 
$
5,076

Accounts payable and other current liabilities
13,546

 
13,016

Total Current Liabilities
19,071

 
18,092

Long-term Debt Obligations
26,318

 
23,821

Other Liabilities
5,915

 
5,744

Deferred Income Taxes
5,019

 
5,304

Total Liabilities
56,323

 
52,961

Commitments and Contingencies
 
 
 
Preferred Stock, no par value
41

 
41

Repurchased Preferred Stock
(184
)
 
(181
)
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: 1,462 and 1,488 shares, respectively)
24

 
25

Capital in excess of par value
4,021

 
4,115

Retained earnings
49,767

 
49,092

Accumulated other comprehensive loss
(12,514
)
 
(10,669
)
Repurchased common stock, in excess of par value (404 and 378 shares, respectively)
(27,694
)
 
(24,985
)
Total PepsiCo Common Shareholders’ Equity
13,604

 
17,578

Noncontrolling interests
118

 
110

Total Equity
13,579

 
17,548

Total Liabilities and Equity
$
69,902

 
$
70,509


See accompanying notes to the condensed consolidated financial statements.


8
Table of Contents    


Condensed Consolidated Statement of Equity
PepsiCo, Inc. and Subsidiaries
(in millions, unaudited)
 
36 Weeks Ended
 
9/5/2015
 
9/6/2014
 
Shares
 
Amount
 
Shares
 
Amount
Preferred Stock
0.8

 
$
41

 
0.8

 
$
41

Repurchased Preferred Stock
 
 
 
 
 
 
 
Balance, beginning of year
(0.7
)
 
(181
)
 
(0.6
)
 
(171
)
Redemptions
—

 
(3
)
 
—

 
(7
)
Balance, end of period
(0.7
)
 
(184
)
 
(0.6
)
 
(178
)
Common Stock
 
 
 
 
 
 
 
Balance, beginning of year
1,488

 
25

 
1,529

 
25

Repurchased common stock
(26
)
 
(1
)
 
(26
)
 
—

Balance, end of period
1,462

 
24

 
1,503

 
25

Capital in Excess of Par Value
 
 
 
 
 
 
 
Balance, beginning of year
 
 
4,115

 
 
 
4,095

Stock-based compensation expense
 
 
208

 
 
 
207

Stock option exercises, RSUs, PSUs and PEPunits converted (a)
 
 
(175
)
 
 
 
(200
)
Withholding tax on RSUs and PSUs converted
 
 
(125
)
 
 
 
(89
)
Other
 
 
(2
)
 
 
 
15

Balance, end of period
 
 
4,021

 
 
 
4,028

Retained Earnings
 
 
 
 
 
 
 
Balance, beginning of year
 
 
49,092

 
 
 
46,420

Net income attributable to PepsiCo
 
 
3,734

 
 
 
5,202

Cash dividends declared – common
 
 
(3,034
)
 
 
 
(2,839
)
Cash dividends declared – preferred
 
 
(1
)
 
 
 
—

Cash dividends declared – RSUs and PSUs
 
 
(24
)
 
 
 
(19
)
Balance, end of period
 
 
49,767

 
 
 
48,764

Accumulated Other Comprehensive Loss
 
 
 
 
 
 
 
Balance, beginning of year
 
 
(10,669
)
 
 
 
(5,127
)
Currency translation:
 
 
 
 
 
 
 
Currency translation adjustment
 
 
(2,106
)
 
 
 
(1,151
)
Reclassification associated with Venezuelan entities
 
 
111

 
 
 
—

Cash flow hedges, net of tax:
 
 
 
 
 
 
 
Reclassification of net losses to net income
 
 
48

 
 
 
84

Net derivative losses
 
 
(51
)
 
 
 
(44
)
Pension and retiree medical, net of tax:
 
 
 
 
 
 
 
Reclassification of net losses to net income
 
 
114

 
 
 
105

Reclassification associated with Venezuelan entities
 
 
16

 
 
 
—

Remeasurement of net liabilities and translation
 
 
24

 
 
 
(12
)
Unrealized losses on securities, net of tax
 
 
(1
)
 
 
 
(1
)
Balance, end of period
 
 
(12,514
)
 
 
 
(6,146
)
Repurchased Common Stock
 
 
 
 
 
 
 
Balance, beginning of year
(378
)
 
(24,985
)
 
(337
)
 
(21,004
)
Share repurchases
(34
)
 
(3,273
)
 
(38
)
 
(3,264
)
Stock option exercises
5

 
382

 
10

 
643

Other
3

 
182

 
2

 
162

Balance, end of period
(404
)
 
(27,694
)
 
(363
)
 
(23,463
)
Total PepsiCo Common Shareholders’ Equity
 
 
13,604

 
 
 
23,208

Noncontrolling Interests
 
 
 
 
 
 
 
Balance, beginning of year
 
 
110

 
 
 
110

Net income attributable to noncontrolling interests
 
 
34

 
 
 
30

Distributions to noncontrolling interests
 
 
(23
)
 
 
 
(23
)
Currency translation adjustment
 
 
(1
)
 
 
 
—

Other, net
 
 
(2
)
 
 
 
(1
)
Balance, end of period
 
 
118

 
 
 
116

Total Equity
 
 
$
13,579

 
 
 
$
23,187

(a)
Includes total tax benefits of $59 million in 2015 and $45 million in 2014.
See accompanying notes to the condensed consolidated financial statements.

9
Table of Contents    


Notes to the Condensed Consolidated Financial Statements
Note 1 - Basis of Presentation and Our Divisions
Basis of Presentation
When used in this report, the terms “we,” “us,” “our,” “PepsiCo” and the “Company” mean PepsiCo, Inc. and its consolidated subsidiaries, collectively.
Our Condensed Consolidated Balance Sheet as of September 5, 2015 and Condensed Consolidated Statements of Income and Comprehensive Income for the 12 and 36 weeks ended September 5, 2015 and September 6, 2014, and the Condensed Consolidated Statements of Cash Flows and Equity for the 36 weeks ended September 5, 2015 and September 6, 2014 have not been audited. These statements have been prepared on a basis that is substantially consistent with the accounting principles applied in our Annual Report on Form 10-K for the fiscal year ended December 27, 2014, except as set forth in the following paragraph. In our opinion, these financial statements include all normal and recurring adjustments necessary for a fair presentation. The results for the 12 and 36 weeks are not necessarily indicative of the results expected for the full year.
Prior to the end of the third quarter of 2015, the financial position and results of operations of our Venezuelan snack and beverage businesses were included in our Condensed Consolidated Financial Statements. Effective as of the end of the third quarter of 2015, we do not meet the accounting criteria for control over our wholly-owned Venezuelan subsidiaries, and therefore we deconsolidated our Venezuelan subsidiaries from our Condensed Consolidated Financial Statements. See “Venezuela” below, and further unaudited information in “Our Business Risks” and “Our Liquidity and Capital Resources” in Management’s Discussion and Analysis of Financial Condition and Results of Operations.
While our results in the United States and Canada (North America) are reported on a 12-week basis, most of our international operations report on a monthly calendar basis for which the months of June, July and August are reflected in our third quarter results.
Our significant interim accounting policies include the recognition of a pro rata share of certain estimated annual sales incentives and certain advertising and marketing costs in proportion to revenue or volume, as applicable, and the recognition of income taxes using an estimated annual effective tax rate. Raw materials, direct labor and plant overhead, as well as purchasing and receiving costs, costs directly related to production planning, inspection costs and raw material handling facilities, are included in cost of sales. The costs of moving, storing and delivering finished product are included in selling, general and administrative expenses.
The following information is unaudited. Tabular dollars are in millions, except per share amounts. All per share amounts reflect common per share amounts, assume dilution unless otherwise noted, and are based on unrounded amounts. This report should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended December 27, 2014.
Our Divisions
As previously disclosed, effective beginning with our third quarter of 2015, we realigned certain of our reportable segments to be consistent with certain changes to our organizational structure and how the Chief Executive Officer monitors the performance of these segments. Our historical segment reporting has been retrospectively revised to reflect our current organizational structure.

10
Table of Contents    


We are organized into six reportable segments (also referred to as divisions), as follows:
1)
Frito-Lay North America (FLNA);
2)
Quaker Foods North America (QFNA);
3)
North America Beverages (NAB), which includes all of our beverage businesses in North America;
4)
Latin America, which includes all of our beverage, food and snack businesses in Latin America;
5)
Europe Sub-Saharan Africa (ESSA), which includes all of our beverage, food and snack businesses in Europe and Sub-Saharan Africa; and
6)
Asia, Middle East and North Africa (AMENA), which includes all of our beverage, food and snack businesses in Asia, Middle East and North Africa.
Net revenue and operating profit of each division are as follows:
 
12 Weeks Ended
 
36 Weeks Ended
Net Revenue
9/5/2015


9/6/2014

 
9/5/2015

 
9/6/2014

FLNA
$
3,555

 
$
3,526

 
$
10,326

 
$
10,132

QFNA
583

 
586

 
1,768

 
1,784

NAB
5,360

 
5,148

 
14,771

 
14,435

Latin America
2,283

 
2,413

 
5,921

 
6,293

ESSA
2,918

 
3,794

 
7,227

 
9,460

AMENA
1,632

 
1,751

 
4,458

 
4,631

Total division
$
16,331

 
$
17,218

 
$
44,471

 
$
46,735

 
12 Weeks Ended
 
36 Weeks Ended
Operating Profit
9/5/2015

 
9/6/2014

 
9/5/2015

 
9/6/2014

FLNA
$
1,085

 
$
1,025

 
$
3,012

 
$
2,824

QFNA (a)
150

 
150

 
381

 
449

NAB (b)
860

 
753

 
2,146

 
1,854

Latin America (c)
(994
)
 
432

 
(420
)
 
1,183

ESSA
398

 
481

 
860

 
1,111

AMENA (d) (e) (f)
199

 
293

 
802

 
841

Total division
1,698

 
3,134

 
6,781

 
8,262

Corporate Unallocated
 
 
 
 
 
 
 
Mark-to-market net (losses)/gains
(28
)
 
(33
)
 
10

 
32

Restructuring and impairment charges
(4
)
 
(15
)
 
(11
)
 
(20
)
Other
(250
)
 
(239
)
 
(667
)
 
(724
)
 
$
1,416

 
$
2,847

 
$
6,113

 
$
7,550

(a)
Operating profit for QFNA for the 36 weeks ended September 5, 2015 includes a pre-tax impairment charge of $65 million ($50 million after-tax) associated with our Muller Quaker Dairy (MQD) joint venture investment.
(b)
Operating profit for NAB for 12 and 36 weeks ended September 5, 2015 includes a gain of $37 million ($23 million after-tax) associated with the settlement of a pension-related liability from a previous acquisition.
(c)
Operating profit for Latin America for the 12 and 36 weeks ended September 5, 2015 includes a pre- and after-tax charge of $1.4 billion related to our change in accounting for our investments in our wholly-owned Venezuelan subsidiaries and our beverage joint venture. See “Venezuela” below.
(d)
Operating profit for AMENA for the 36 weeks ended September 5, 2015 includes a pre-tax gain of $39 million ($28 million after-tax) associated with refranchising a portion of our beverage businesses in India.
(e)
Operating profit for AMENA for the 12 and 36 weeks ended September 5, 2015 includes a pre- and after-tax charge of $73 million related to a write-off of the recorded value of a call option to increase our holding in Tingyi-Asahi Beverages Holding Co. Ltd.
(f)
Operating profit for AMENA for the 12 and 36 weeks ended September 5, 2015 includes a pre- and after-tax impairment charge of $29 million associated with a joint venture in the Middle East.

11
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Total assets of each division are as follows:
 
Total Assets
 
9/5/2015


12/27/2014

FLNA
$
5,430

 
$
5,307

QFNA
921

 
982

NAB
29,223

 
28,665

Latin America (a)
4,432

 
6,283

ESSA
13,341

 
13,934

AMENA
5,866

 
5,855

Total division
59,213

 
61,026

Corporate (b)
10,689

 
9,483


$
69,902

 
$
70,509

(a)
The change in total assets as of September 5, 2015 reflects a decrease of $1.7 billion related to the Venezuela impairment charges.
(b)
Corporate assets consist principally of certain cash and cash equivalents, short-term investments, derivative instruments, property, plant and equipment and pension and tax assets.
Venezuela
Prior to the end of the third quarter of 2015, the financial position and results of operations of our Venezuelan businesses were reported under highly inflationary accounting since the beginning of our 2010 fiscal year, at which time the functional currency of our Venezuelan entities, which consist of our wholly-owned subsidiaries and our beverage joint venture, was changed from the bolivar to the U.S. dollar.
The Venezuelan government has maintained currency controls and a fixed exchange rate since 2003. In the last two years, the Venezuelan government has created additional exchange mechanisms and issued several exchange agreements governing the scope and applicability of each, while continuing to maintain control over the exchange rates and, to an increasingly significant extent, over the distribution of U.S. dollars under each mechanism.
As of the end of the third quarter of 2015, there was a three-tiered exchange rate mechanism in Venezuela for exchanging bolivars into U.S. dollars: (1) the government-operated National Center of Foreign Commerce (CENCOEX), which has a fixed exchange rate of 6.3 bolivars per U.S. dollar, mainly intended for the import of essential goods and services by designated industry sectors; (2) the government-operated auction-based Supplementary Foreign Currency Administration System (SICAD), which is intended for certain transactions, including foreign investments, for which the rate has ranged from 10 to 14 bolivars per U.S. dollar; and (3) an open market Marginal Foreign Exchange System (SIMADI), which was trading at a rate of approximately 200 bolivars per U.S. dollar as of the end of the third quarter of 2015.
These three mechanisms have become increasingly illiquid over time. We believe that significant uncertainty continues to exist regarding the exchange mechanisms in Venezuela, including the nature of transactions that are eligible to flow through CENCOEX, SICAD or SIMADI, or any other new exchange mechanism that may emerge, how any such mechanisms will operate in the future, as well as the availability of U.S. dollars under each mechanism. The amount of U.S. dollars made available to our Venezuelan entities through CENCOEX has declined significantly since 2014 and has worsened during the third quarter of 2015. In addition, our Venezuelan entities were not able to participate in SICAD auctions during 2015, as the auctions that were held were not for our industry, and have had limited access to the SIMADI market since its inception.
The evolving conditions in Venezuela, including the increasingly restrictive exchange control regulations and reduced access to dollars through official currency exchange markets, have resulted in an other-than-temporary lack of exchangeability between the Venezuelan bolivar and the U.S. dollar, which is significantly impacting our ability to effectively manage our Venezuelan businesses, including restrictions on the ability

12
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of our Venezuelan businesses to import certain raw materials to maintain normal production and to settle U.S. dollar-denominated obligations. The exchange restrictions, combined with other regulations that have limited our ability to import certain raw materials, have also increasingly constrained our ability to make and execute operational decisions regarding our businesses in Venezuela. In addition, the inability of our Venezuelan businesses to pay dividends, which remain subject to Venezuelan government approvals, has restricted our ability to realize the earnings generated out of our Venezuelan businesses. We expect these conditions will continue for the foreseeable future.
As a result of these factors, we concluded that effective as of the end of the third quarter of 2015, we do not meet the accounting criteria for control over our wholly-owned Venezuelan subsidiaries, and therefore we deconsolidated our wholly-owned Venezuelan subsidiaries effective as of the end of the third quarter of 2015. We also concluded that, effective as of the end of the third quarter of 2015, due to the above mentioned factors and other matters impacting the operation of our joint venture and the distribution of its products, we no longer have significant influence over our beverage joint venture with our franchise bottler in Venezuela, which was previously accounted for under the equity method. As a result of these conclusions, effective at the end of the third quarter of 2015, we began accounting for our investments in our wholly-owned Venezuelan subsidiaries and our joint venture using the cost method of accounting and recorded pre- and after-tax charges of $1.4 billion on our Condensed Consolidated Statement of Income to reduce the value of the cost method investments to their estimated fair values, resulting in a full impairment. The impairment charges primarily include approximately $1.2 billion related to our investments in previously consolidated Venezuelan subsidiaries and our joint venture, and $111 million related to the reclassification of cumulative translation losses. The estimated fair value of the investments in our Venezuelan entities was derived using discounted cash flow analyses, including U.S. dollar exchange and discount rate assumptions that reflect the inflation and economic uncertainty in Venezuela, and are considered non-recurring Level 3 measurements within the fair value hierarchy.
During 2015 and prior to the end of the third quarter of 2015, we used the SICAD exchange rate to remeasure our net monetary assets in Venezuela, except for certain other net monetary assets that we believed qualified for the fixed exchange rate (including requests for remittance of dividends submitted to CENCOEX in certain prior years at the fixed exchange rate and payables for imports of essential goods approved by CENCOEX). In the 36 weeks ended September 5, 2015, which reflect the months of January through August, the results of our operations in Venezuela were included in our Condensed Consolidated Statement of Income using a combination of the fixed exchange and SICAD rates, as appropriate. As of the end of the third quarter of 2015, we did not consolidate the assets and liabilities of our Venezuelan subsidiaries in our Condensed Consolidated Balance Sheet. Beginning in the fourth quarter of 2015, we will not include the results of our Venezuelan businesses in our Condensed Consolidated Statement of Income. For future reporting periods, our financial results will only include revenue relating to the sales of inventory to our Venezuelan entities to the extent cash is received for those sales. Any dividends from our Venezuelan entities will be recorded as income upon receipt of the cash. See further unaudited information in “Our Business Risks” and “Our Liquidity and Capital Resources” in Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Note 2 - Recent Accounting Pronouncements
In July 2015, the Financial Accounting Standards Board (FASB) issued new accounting guidance that requires entities to measure inventory at the lower of cost or net realizable value. Net realizable value is defined as the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The guidance is effective as of the beginning of our 2017 fiscal year and must be applied on a prospective basis with early adoption permitted. The guidance is not expected to have a material impact on our financial statements and we have not early adopted this standard.

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In April 2015, the FASB issued new accounting guidance intended to simplify the presentation of debt issuance costs. The guidance requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with the presentation for debt discounts. The guidance is effective as of the beginning of our 2016 fiscal year and must be applied on a retrospective basis with early adoption permitted. We early adopted the provisions of this guidance as of the beginning of our second quarter of 2015 and it did not have a material impact on our financial statements.
In June 2014, the FASB issued new accounting guidance for share-based payments when the terms of an award provide that a performance target could be achieved after the requisite service period. The guidance requires that a performance target that could be achieved after the requisite service period is treated as a performance condition that affects the vesting of the award rather than factored into the grant date fair value. The guidance is effective as of the beginning of our 2016 fiscal year and can be applied prospectively to all share-based payments granted or modified on or after the effective date with early adoption permissible. This guidance is not expected to have any impact on our financial statements and we have not early adopted this standard.
In May 2014, the FASB issued new accounting guidance on revenue recognition, which provides for a single five-step model to be applied to all revenue contracts with customers. The new standard also requires additional financial statement disclosures that will enable users to understand the nature, amount, timing and uncertainty of revenue and cash flows relating to customer contracts. Companies have an option to use either a retrospective approach or cumulative effect adjustment approach to implement the standard. There is no option for early adoption. In August 2015, the FASB issued a one-year deferral of the effective date of the new revenue standard. The new guidance will be effective as of the beginning of our 2018 fiscal year. We are currently evaluating the impact of the new guidance on our financial statements and have not yet selected a transition approach to implement this standard.
Note 3 - Restructuring and Impairment Charges
2014 Multi-Year Productivity Plan
The multi-year productivity plan we publicly announced on February 13, 2014 (2014 Productivity Plan) includes the next generation of productivity initiatives that we believe will strengthen our food, snack and beverage businesses by: accelerating our investment in manufacturing automation; further optimizing our global manufacturing footprint, including closing certain manufacturing facilities; re-engineering our go-to-market systems in developed markets; expanding shared services; and implementing simplified organization structures to drive efficiency. The 2014 Productivity Plan is in addition to the productivity plan we began implementing in 2012 and is expected to continue the benefits of that plan.
In the 12 weeks ended September 5, 2015 and September 6, 2014, we incurred restructuring charges of $43 million ($33 million after-tax or $0.02 per share) and $54 million ($39 million after-tax or $0.03 per share), respectively, in conjunction with our 2014 Productivity Plan. In the 36 weeks ended September 5, 2015 and September 6, 2014, we incurred restructuring charges of $94 million ($73 million after-tax or $0.05 per share) and $227 million ($167 million after-tax or $0.11 per share), respectively, in conjunction with our 2014 Productivity Plan. All of these net charges were recorded in selling, general and administrative expenses and primarily relate to severance and other employee-related costs, asset impairments (all non-cash) and contract termination costs. The majority of the restructuring accrual at September 5, 2015 is expected to be paid by the end of 2015.

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A summary of our 2014 Productivity Plan charges is as follows:
 
 
12 Weeks Ended
 
36 Weeks Ended
 
 
9/5/2015

 
9/6/2014

 
9/5/2015

 
9/6/2014

FLNA
 
$
12

 
$
9

 
$
20

 
$
33

QFNA
 
1

 
—

 
2

 
2

NAB
 
4

 
14

 
18

 
128

Latin America
 
5

 
10

 
11

 
17

ESSA
 
15

 
7

 
28

 
22

AMENA
 
3

 
2

 
7

 
11

Corporate
 
3

 
12

 
8

 
14

 
 
$
43

 
$
54

 
$
94

 
$
227

A summary of our 2014 Productivity Plan activity in 2015 is as follows:
 
Severance and Other
Employee Costs
 
Asset Impairment
 
Other Costs
 
Total
Liability as of December 27, 2014
$
89

 
$
—

 
$
24

 
$
113

2015 restructuring charges
37

 
4

 
53

 
94

Cash payments
(56
)
 
—

 
(59
)
 
(115
)
Non-cash charges
(11
)
 
(4
)
 
(1
)
 
(16
)
Liability as of September 5, 2015
$
59

 
$
—

 
$
17

 
$
76

2012 Multi-Year Productivity Plan
The multi-year productivity plan we publicly announced on February 9, 2012 (2012 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 2012 Productivity Plan continues to enhance PepsiCo’s cost-competitiveness and provide a source of funding for future brand-building and innovation initiatives.
In the 12 weeks ended September 5, 2015 and September 6, 2014, we incurred restructuring charges of $9 million ($8 million after-tax or $0.01 per share) and $14 million ($12 million after-tax or $0.01 per share), respectively, in conjunction with our 2012 Productivity Plan. In the 36 weeks ended September 5, 2015 and September 6, 2014, we incurred restructuring charges of $19 million ($16 million after-tax or $0.01 per share) and $31 million ($29 million after-tax or $0.02 per share), respectively, in conjunction with our 2012 Productivity Plan. All of these net charges were recorded in selling, general and administrative expenses and primarily relate to severance and other employee-related costs, asset impairments (all non-cash) and contract termination costs. Substantially all of the restructuring accrual at September 5, 2015 is expected to be paid by the end of 2015.

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A summary of our 2012 Productivity Plan charges is as follows:
 
 
12 Weeks Ended
 
36 Weeks Ended
 
 
9/5/2015

 
9/6/2014

 
9/5/2015

 
9/6/2014

FLNA
 
$
—

 
$
—

 
$
—

 
$
2

QFNA
 
—

 
—

 
—

 
—

NAB
 
—

 
—

 
1

 
7

Latin America (a)
 
5

 
(2
)
 
5

 
(7
)
ESSA
 
3

 
7

 
9

 
15

AMENA
 
—

 
6

 
1

 
8

Corporate
 
1

 
3

 
3

 
6

 
 
$
9

 
$
14

 
$
19

 
$
31

(a)
Income amounts represent adjustments of previously recorded amounts.
A summary of our 2012 Productivity Plan activity in 2015 is as follows: 
 
Severance and Other Employee Costs
 
Asset Impairment
 
Other Costs
 
Total
Liability as of December 27, 2014
$
28

 
$
—

 
$
5

 
$
33

2015 restructuring charges
5

 
1

 
13

 
19

Cash payments
(18
)
 
—

 
(16
)
 
(34
)
Non-cash charges
(5
)
 
(1
)
 
—

 
(6
)
Liability as of September 5, 2015
$
10

 
$
—

 
$
2

 
$
12

Other Productivity Initiatives
In the 12 weeks ended September 5, 2015, we incurred pre-tax charges of $44 million ($29 million after-tax or $0.02 per share) related to productivity and efficiency initiatives outside the scope of the 2014 and 2012 Productivity Plans discussed above, including $5 million in Latin America, $1 million in ESSA, $8 million in AMENA and $30 million in Corporate. In the 36 weeks ended September 5, 2015, we incurred pre-tax charges of $54 million ($37 million after-tax or $0.02 per share) related to productivity and efficiency initiatives outside the scope of the 2014 and 2012 Productivity Plans discussed above, including $5 million in both Latin America and ESSA, $14 million in AMENA and $30 million in Corporate. These charges were recorded in selling, general and administrative expenses and primarily reflect severance and other employee-related costs. These initiatives were excluded from Items Affecting Comparability. See additional unaudited information in “Results of Operations – Division Review” in Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Note 4 - Intangible Assets
A summary of our amortizable intangible assets is as follows:
 
 
9/5/2015
 
12/27/2014
Amortizable intangible assets, net
 
Gross
 
Accumulated Amortization
 
Net
 
Gross
 
Accumulated Amortization
 
Net
Acquired franchise rights
 
$
831

 
$
(90
)
 
$
741

 
$
879

 
$
(89
)
 
$
790

Reacquired franchise rights
 
106

 
(98
)
 
8

 
107

 
(95
)
 
12

Brands
 
1,309

 
(990
)
 
319

 
1,361

 
(1,004
)
 
357

Other identifiable intangibles
 
540

 
(296
)
 
244

 
595

 
(305
)
 
290

 
 
$
2,786

 
$
(1,474
)
 
$
1,312

 
$
2,942

 
$
(1,493
)
 
$
1,449


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The change in the book value of nonamortizable intangible assets is as follows:
 
Balance
 
Translation
and Other
 
Balance

12/27/2014
 
 
9/5/2015
FLNA

 

 

Goodwill
$
291

 
$
(18
)
 
$
273

Brands
27

 
(4
)
 
23


318

 
(22
)
 
296

 
 
 
 
 
 
QFNA
 
 
 
 
 
Goodwill
175

 
—

 
175

 
 
 
 
 
 
NAB
 
 
 
 
 
Goodwill
9,846

 
(69
)
 
9,777

Reacquired franchise rights
7,193

 
(112
)
 
7,081

Acquired franchise rights
1,538

 
(23
)
 
1,515

Brands
108

 
—

 
108


18,685

 
(204
)
 
18,481

 
 
 
 
 
 
Latin America (a)
 
 
 
 
 
Goodwill
644

 
(97
)
 
547

Brands
223

 
(78
)
 
145


867

 
(175
)
 
692

 
 
 
 
 
 
ESSA
 
 
 
 
 
Goodwill
3,539

 
(310
)
 
3,229

Reacquired franchise rights
571

 
(58
)
 
513

Acquired franchise rights
199

 
(4
)
 
195

Brands
2,663

 
(264
)
 
2,399


6,972

 
(636
)
 
6,336

 
 
 
 
 
 
AMENA
 
 
 
 
 
Goodwill
470

 
(64
)
 
406

Brands
117

 
(15
)
 
102


587

 
(79
)
 
508

 
 
 
 
 
 
Total goodwill
14,965

 
(558
)
 
14,407

Total reacquired franchise rights
7,764

 
(170
)
 
7,594

Total acquired franchise rights
1,737

 
(27
)
 
1,710

Total brands
3,138

 
(361
)
 
2,777


$
27,604

 
$
(1,116
)
 
$
26,488

(a)
The change in 2015 includes a reduction of $41 million of nonamortizable brands arising from the Venezuela deconsolidation.

17
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Note 5 - Income Taxes
A rollforward of our reserves for all federal, state and foreign tax jurisdictions is as follows: 
 
9/5/2015

 
12/27/2014

Balance, beginning of year
$
1,587

 
$
1,268

Additions for tax positions related to the current year
180

 
349

Additions for tax positions from prior years
43

 
215

Reductions for tax positions from prior years
(9
)
 
(81
)
Settlement payments
(8
)
 
(70
)
Statutes of limitations expiration
(30
)
 
(42
)
Translation and other
(20
)
 
(52
)
Balance, end of period
$
1,743

 
$
1,587

Note 6 - Stock-Based Compensation
The following table summarizes our total stock-based compensation expense:
 
 
12 Weeks Ended
 
36 Weeks Ended
 
 
9/5/2015

 
9/6/2014

 
9/5/2015


9/6/2014

Stock-based compensation expense
 
$
64

 
$
67

 
$
208

 
$
207

Restructuring and impairment charges/(credits)
 
1

 
(1
)
 
2

 
(4
)
Total
 
$
65

 
$
66

 
$
210

 
$
203

Our weighted-average Black-Scholes fair value assumptions are as follows: 
 
36 Weeks Ended
 
9/5/2015

 
9/6/2014

Expected life
7 years

 
6 years

Risk free interest rate
1.8
%
 
1.8
%
Expected volatility (a)
15
%
 
16
%
Expected dividend yield
2.7
%
 
2.9
%
(a)
Reflects movements in our stock price over the most recent historical period equivalent to the expected life.
For the 12 weeks ended September 5, 2015 and September 6, 2014, our grants of stock options, restricted stock units (RSUs), performance stock units (PSUs) and PepsiCo equity performance units (PEPunits) were nominal.
The following table summarizes awards granted under the terms of our 2007 Long-Term Incentive Plan:
 
 
36 Weeks Ended
 
 
9/5/2015
 
9/6/2014
 
 
Granted (a)
 
Weighted-Average Grant Price
 
Granted (a)
 
Weighted-Average Grant Price
Stock options
 
1.8

 
$
98.76

 
3.3

 
$
80.67

RSUs and PSUs
 
2.7

 
$
99.15

 
4.2

 
$
79.80

PEPunits
 
0.3

 
$
99.25

 
0.4

 
$
79.75

(a)
In millions.

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Note 7 - Pension and Retiree Medical Benefits
The components of net periodic benefit cost for pension and retiree medical plans are as follows: 
 
12 Weeks Ended
 
Pension

Retiree Medical
 
9/5/2015


9/6/2014


9/5/2015


9/6/2014


9/5/2015


9/6/2014

 
U.S.

International

 
Service cost
$
100


$
91


$
25


$
24


$
8


$
8

Interest cost
126


134


30


33


12


14

Expected return on plan assets
(195
)

(181
)

(44
)

(44
)

(6
)

(6
)
Amortization of prior service (credit)/cost
(1
)

5


—


—


(9
)

(5
)
Amortization of net losses/(gains)
47


40


18


14


—


(2
)

77


89


29


27


5


9

Settlement loss
—

 
—

 
3

 
3

 
—

 
—

Special termination benefits
4


3


—


—


—


1

Total expense
$
81


$
92


$
32


$
30


$
5


$
10

 
36 Weeks Ended
 
Pension
 
Retiree Medical
 
9/5/2015

 
9/6/2014

 
9/5/2015

 
9/6/2014

 
9/5/2015

 
9/6/2014

 
U.S.
 
International
 
 
Service cost
$
301

 
$
272

 
$
70

 
$
67

 
$
24

 
$
24

Interest cost
378

 
402

 
81

 
90

 
36

 
42

Expected return on plan assets
(588
)
 
(543
)
 
(122
)
 
(120
)
 
(18
)
 
(18
)
Amortization of prior service (credit)/cost
(2
)
 
14

 
—

 
—

 
(27
)
 
(15
)
Amortization of net losses/(gains)
142

 
121

 
50

 
36

 
1

 
(4
)
 
231

 
266

 
79

 
73

 
16

 
29

Settlement loss
—

 
—

 
3

 
3

 
—

 
—

Special termination benefits
9

 
11

 
—

 
—

 
1

 
2

Total expense
$
240

 
$
277

 
$
82

 
$
76

 
$
17

 
$
31

 
 
 
 
 
 
 
 
 
 
 
 
We regularly evaluate different opportunities to reduce risk and volatility associated with our pension and retiree medical plans. During the second quarter of 2014, we made discretionary contributions of $19 million to our international pension plans.

19
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Note 8 - Debt Obligations and Commitments
In the second quarter of 2015, we issued:
•
$250 million of floating rate notes maturing in April 2018;
•
$500 million of 1.250% senior notes maturing in April 2018;
•
$750 million of 1.850% senior notes maturing in April 2020; and
•
$1 billion of 2.750% senior notes maturing in April 2025.
In the third quarter of 2015, we issued:
•
$600 million of floating rate notes maturing in July 2017;
•
$650 million of 1.125% senior notes maturing in July 2017;
•
$800 million of 3.100% senior notes maturing in July 2022;
•
$700 million of 3.500% senior notes maturing in July 2025; and
•
$500 million of 4.600% senior notes maturing in July 2045.
The net proceeds from the issuances of the above notes were used for general corporate purposes, including the repayment of commercial paper.
In the 36 weeks ended September 5, 2015, $4.1 billion of senior notes matured and were paid.
In the second quarter of 2015, we entered into a new five-year unsecured revolving credit agreement (Five-Year Credit Agreement) which expires on June 8, 2020. The Five-Year Credit Agreement enables us and our borrowing subsidiaries to borrow up to $3.7225 billion, subject to customary terms and conditions. We may request that commitments under this agreement be increased up to $4.5 billion. Additionally, we may, once a year, request renewal of the agreement for an additional one-year period.
Also in the second quarter of 2015, we entered into a new 364-day unsecured revolving credit agreement (364-Day Credit Agreement) which expires on June 6, 2016. The 364-Day Credit Agreement enables us and our borrowing subsidiaries to borrow up to $3.7225 billion, subject to customary terms and conditions. We may request that commitments under this agreement be increased up to $4.5 billion. We may request renewal of this facility for an additional 364-day period or convert any amounts outstanding into a term loan for a period of up to one year, which would mature no later than the anniversary of the then effective termination date. The Five-Year Credit Agreement and the 364-Day Credit Agreement together replaced our $3.7725 billion five-year credit agreement dated as of June 9, 2014 and our $3.7725 billion 364-day credit agreement dated as of June 9, 2014. Funds borrowed under the Five-Year Credit Agreement and the 364-Day Credit Agreement may be used for general corporate purposes. Subject to certain conditions, we may borrow, prepay and reborrow amounts under these agreements. As of September 5, 2015, there were no outstanding borrowings under the Five-Year Credit Agreement or the 364-Day Credit Agreement.
As of September 5, 2015, we had $2.2 billion of commercial paper outstanding and $1.5 billion of non-cancelable purchase commitments. For further information on our long-term contractual commitments, see Note 9 to our consolidated financial statements in our Annual Report on Form 10-K for the year-ended December 27, 2014.

20
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Note 9 - Accumulated Other Comprehensive Loss
The reclassifications from Accumulated Other Comprehensive Loss to the Condensed Consolidated Statement of Income are summarized as follows:
 
 
12 Weeks Ended
 
36 Weeks Ended
 
 
 
 
9/5/2015

 
9/6/2014

 
9/5/2015

 
9/6/2014

 
Affected Line Item in the Condensed Consolidated Statement of Income
Currency Translation:
 
 
 
 
 
 
 
 
 
 
    Venezuelan entities
 
$
111

 
$
—

 
$
111

 
$
—

 
Venezuela impairment charges
 
 
 
 
 
 
 
 
 
 
 
(Gains)/Losses on cash flow hedges:
 
 
 
 
 
 
 
 
 
 
    Foreign exchange contracts
 
$
—

 
$
—

 
$
(2