|April 18, 2011|
|PR Shake-up At Pepsi; Blocked Soda Tax|
|By Jack O'Dwyer|
|PepsiCo, burdened with $24.9 billion debt and a stock price that hit $77 in 2008 but is now $65, has named an executive with an IR background as executive VP of global corporate affairs.|
Tim Cost, (bio, PDF) who was chair of the National Investor Relations Institute in 1998, reports to CEO Indra Nooyi, instead of Julie Hamp, SVP and chief communications officer. He was most recently with APCO Worldwide but before that worked at major companies including Wyeth, which was acquired by Pfizer in 2009, Aramark, Pharmacia Corp. (acquired by Pfizer in 2003), and Bristol-Myers Squibb, Centocor, which became part of Johnson & Johnson.
PepsiCo’s debt/equity ratio is 1.11, meaning its debt is greater than its equity. Sales were $57.8B in 2010.
The $24.9B in debt was rung up in acquiring other companies. It now owns 19 brands with sales over $1 billion each.
Apple, with sales of $76.3B in 2010, has no debt. It has $26B in cash. Pepsi has $3.7B in cash.
Indra Nooyi, chairman and CEO of PepsiCo, is one of the 50 highest paid CEOs in the U.S. according to a study in the April 10 New York Times. Her pay in 2010 was $14M including $6M in stock awards.
Three VPs Leave
Leaving PepsiCo April 1 was Mark Dollins, senior VP-communications, Pepsi Beverages Co.
Dollins has started Blue Moon Communications touting more than 20 years of experience in consumer goods, utilities and mass media.
He joined Quaker Oats in 1994 as VP-corporate communications and rose to SVP-communications at PepsiCo Americas Foods and global internal communications in May 2008. He remained in that job until March 2010.
Also leaving were VPs Lynn Markley and Bernadette Wade. P.J. Sinopoli, a part-time employee in PR, departed from the Chicago office.
The corporate PR dept., including consumer relations, has more than 100 professionals, said Peter Land, SVP, who now heads media relations at the company.
Joining “strategic communications” in the last year were Nancy Lintner, former CCO, United Technologies Corp., and Maryann Watson, who was SVP at Ruder Finn.
Four people were added to the digital group, two to beverage PR and Chris Wyse, CCO for Whirlpool, was named PR head at Frito-Lay.
Pepsi and Others Battled Soda Tax
PepsiCo and other soda companies successfully battled a move to put a one-cent per ounce tax on soda in New York last year.
Nutritionists said Americans drink an average of 50 gallons of soda yearly, making it the No. 1 source of calories in the American diet.
They say it is “empty calories” without nutritional properties. Critics say the sugar and salt content only winds up making users thirstier than ever.
Pepsi has removed sugared drinks from schools.
President Obama, who said Americans in general and kids in particular drink “way too much soda,” only said that taxing soda was “an idea that we should be exploring.”
Patterson Withdrew Tax Proposal
Former New York Gov. David Patterson proposed a penny-per-ounce tax on soda that would have raised a 12-pack of Coke from $2.99 to $4.43 and a 75-cent can to 87 cents.
Heavy industry lobbying resulted in him removing the proposal from his budget.
PepsiCo SVP of global health Derek Yach said a soda tax “would lead to unknown effects on total dietary consumption. It may even lead to worse situations: people may stop spending on one food and eat more of another, so taxing high levels of sugar may lead to eating higher levels of fat.”
The American Beverage Assn. said that obesity can’t be cured by “eliminating one food from the diet.”
Some nutritionists responded that soda would be a “good start.”
There are taxes on soda in Arkansas, Tennessee, Virginia, Washington and West Virginia. Such taxes were sought in at least 12 other states, said a New York Times article Feb. 13, 2010, but none were approved.
Pepsi has brought back Pepsi Throwback which is advertised as “replacing high-fructose corn syrup with yesteryear’s (cane and beet) sugar.”
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