Yoshives Belizaire Zhongling Cao Shawn Parker Dave Saucier © 2013, Yoshives Belizaire, Zhongling Cao, Shawn Parker, Dave Saucier, UMFK

A Strategic Management Case study

Yoshives Belizaire Zhongling Cao

Shawn Parker Dave Saucier

© 2013, Yoshives Belizaire, Zhongling Cao, Shaw

n Parker, Dave Saucier, U

MFK

Dr. Pepper was created in 1885 by Charles Alderton at Morrison’s Old Corner Drug Store in Waco, Texas.

Nearly a 100 years later , three New York- area food storeowners created a unique addle soda they named Snapple.

In 2006, Cadbury Schweppes purchased Dr Pepper and Snapple.

In May 2008 Cadbury Schweppes spun off Cadbury Schweppes Americas Beverages into an independent company, called the Dr Pepper Snapple group.

History

© 2013, Yoshives Belizaire, Zhongling Cao, Shawn Parker, Dave Saucier, UMFK

Existing Mission Statement


None…

Existing Vision Statement


Company Current Strategy


Build and enhance leading Brands

Focus-on opportunities in high growth and high margin

areas

Increase presence in high margin channels and

packages

Leverage our integrated business model

Strengthen our route-to-market through acquisitions

Improve operating efficiency

RCI- Rapid Continuous Improvement

Health and Wellness initiative

Vision Statement


Mission Statement


At Dr. Pepper Snapple Group it is our mission to be the domestic leader (3) in the flavored beverage industry (2). Our established and reputable brand (6) allows us to deliver high quality beverages (7) to faithful and potential customers (1). We will achieve this through effective marketing, strong distribution channels, and fruitful partnerships. We will continue to invest in our employees (9) as well as the communities we operate in while remaining environmentally friendly (8). By implementing the best technology (4) we are committed to reducing costs in order to ensure sustained profits (5).

1. Customers 4.Technology 7. Self-concept2. Products 5. Survival Growth & Profitability 8. Concern for Public Image3. Markets 6. Philosophy 9. Concern for Employees

External Audit


Industry Market Analysis


Opportunities

1. Pepsi and Coke distribute other brands globally.2. Americans are looking for more low/no calorie drinks, this

market grew 1.2% in 2010.3. Consumers are looking for nutrient enriched beverages.4. There are over 300 Soft Drink manufactures .5. Owning bottling distribution networks reduces cost and

dependence on other companies.6. Strategic alliances with restaurants and fast food chains

are readily available. 7. The US beverage market to expect grow by 0.9 percent in

2011.8. Growth to international market. 9. Countries such as India and China has over 9% GDP growth

in 2010.


Threats

1. New York City is looking to banning sugary drinks.2. Increasing cost of commodities, especially the volatile

sugar industry and sugar tax.3. Some legislators are proposing tax on sugared soft drinks.4. U.S consumption of soft drinks in 2011 is the lowest since

1996, The carbonated soft drinks market is expected to decrease 2.2% by 2015.

5. Operate in a discretionary item industry, very volatile.6. Highly competitive market.7. The health issue with some of their products for example

sodas. 8. The Institute of Medicine, a government-chartered

organization, which stated that food and beverage companies are using television ads to entice kids into eating and drinking unhealthful quantities.

9. Diet Pepsi experienced an 8% decrease in 2011 in sales according to beverage digest. © 2013, Yoshives Belizaire, Zhongling Cao, Shawn Parker, Dave Saucier, UMFK

Competitive Profile Matrix


Dr. Pepper Snapple Coca Cola Pepsi

Critical Success factors Weights Rating

Weighted Score

RatingWeighted Score

Rating Weight

ed Score0.0 to 1.0 1 to 4 1 to 4 1 to 4

Advertising 0.1 2 0.2 3 0.3 4 0.4Organization 0.08 3 0.24 4 0.32 4 0.32Structure 0.07 3 0.21 4 0.28 4 0.28Customer Service 0.06 3 0.18 3 0.18 3 0.18Global Expansion 0.08 1 0.08 4 0.32 3 0.24Financial Position 0.09 2 0.18 4 0.36 3 0.27Management Experience 0.08 3 0.24 4 0.32 4 0.32Customer Loyalty 0.07 3 0.21 3 0.21 3 0.21Market Share 0.1 2 0.2 4 0.4 3 0.3Product Quality 0.1 3 0.3 4 0.4 3 0.3E-commerce 0.08 3 0.24 4 0.32 4 0.32Price Competitiveness 0.09 3 0.27 3 0.27 3 0.27Totals 1 2.55 3.68 3.41

External Factor Evaluation


External Opportunities1. Pepsi and Coke distribute other brands globally 0.05 3 0.152. Americans are looking for more low/no calorie drinks, this market grew 1.2% in 2010 0.08 2 0.163. Consumers are looking for nutrient enriched beverages 0.07 1 0.074. There are over 300 Soft Drink manufactures 0.06 2 0.125. Strategic alliances with restaurants and fast food chains are readily available. 0.06 2 0.126. Owning bottling distribution networks reduces cost and dependence on other companies 0.05 3 0.157. The US beverage market grew by 0.9 percent in 2011 0.06 1 0.068. Growth to international market. 0.05 2 0.19. Countries such as India and China has over 9% GDP growth in 2010. 0.05 2 0.1External Threats 01. New York City is looking to banning sugary drinks 0.04 1 0.042. U.S consumption of soft drinks in 2011 is the lowest since 1996, The carbonated soft drinks market is expected to decrease 2.2% by 2015 0.06 3 0.183. Some legislators are proposing tax on sugared soft drinks 0.05 1 0.054. Increasing cost of commodities, especially the volatile sugar industry and sugar tax. 0.06 1 0.065. Operate in a discretionary item industry, very volatile. 0.07 1 0.076. Highly competitive market. 0.05 2 0.17. The health issue with some of their products for example sodas. 0.05 2 0.18. The Institute of Medicine, a government-chartered organization, which stated that food and beverage companies are using television ads to entice kids into eating and drinking unhealthful quantities. 0.03 2 0.069. Diet Pepsi experienced an 8% decrease in 2011 in sales according to beverage digest. 0.06 2 0.12Totals 1 1.81

Internal Audit


Organization Structure


Financial-Income Statement



MFK

Financial – Balance Sheet


Financial – Balance Sheet



MFK

Net Worth Analysis


Stockholders' Equity $2,459

Net Income x 5 2,640

(Share Price/EPS) x Net Income 7,886 Number of Shares Outstanding x Share Price 7,863

Method Average $5,212

In millions

Ratio Analysis


Liquidity Ratios DPS PEP KOCurrent Ratio 0.98 1.11 1.17Quick Ratio 0.80 0.89 1.02Leverage RatiosDebt-to-Total Assets Ratio 0.72 0.68 1.00Debt-to-Equity Ratio 2.60 2.19 2.33Long-Term Debt-to-Equity Ratio 0.69 0.94 0.45Times-Interest-Earned Ratio 8.01 9.23 11.53Activity RatiosInventory Turns 30.63 36.38 34.13Fixed Assets Turnover 4.83 3.03 2.38Total Assets Turnover 0.64 0.85 0.48Accounts Receivable Turnover 9.87 9.15 7.93Average Collection Period 36.98 39.90 46.04Profitability RatiosGross Profit Margin 0.60 0.54 0.64Operating Profit Margin 18.19% 14.41% 24.06%Net Profit Margin 9.37% 10.96% 34.65%Return on Total Assets 5.96% 9.30% 16.19%Return on Stockholders equity 21.47% 29.79% 37.71%Earning per Share 2.20 3.40 5.12Price-Earnings Ratio 14.89 17.96 6.01Growth Rations (yearly)Sales 1.90% 33.79% 13.32%Net Income -4.86% 6.00% 73.05%Earnings per Share 0.46% 4.20% 73.56%Dividends per Share 500.00% 6.78% 7.32%

Strengths

1. Owns 6 of the top 10 non-cola drinks.2. 9 of their top 12 brands are number 1 in their flavor

category.3. Snapple brand grew 10% in 2010.4. Pay above average dividends, raising 500% in 2010 to

$.90.5. Has 21 manufacturing / bottle facilities located in the

United States, Canada, Mexico, and the Caribbean’s .6. Overall Dr. Pepper Snapple group is the #1 company in the

flavored CSD market. Dr. Pepper is the #2 flavored CSD and Snapple is the leading ready-to-drink tea.

7. The Company’s combination of brand ownership, bottling and distribution gives it inherently more control over the value chain and thus a competitive advantage.

8. Has more than 50 brands under Dr. Pepper Snapple group.9. Dr. Pepper’s brand is spanning more than 125 years.10.22% increase on EPS


Weaknesses

1. Low market share in Carbonated Beverage industry.

2. Does not have low calorie or sports drinks.

3. Does not have a strong water brand.

4. 71% of its volume is distributed by Coca-Cola and PepsiCo.

5. We are not a global company like Pepsi and Coca Cola,

only operating in North America and the Caribbean.

6. Is considered the third top brand for soft drinks.

7. Only rank #20 in beverage industry worldwide.

8. Too focused on every drink production.

9. Dr. Pepper wasn't list in top 20 most nutrition beverage

company.

10.Revenues increased 1.8% in 2010 while net income

decreased 5%. © 2013, Yoshives Belizaire, Zhongling Cao, Shawn Parker, Dave Saucier, UMFK

Internal Factor Evaluation

Internal Strengths 3 or

4

1.Owns 6 of the top 10 non-cola drinks.0.0

4 3 0.12

2.9 of their top 12 brands are number 1 in their flavor category.0.0

5 3 0.15

3.Snapple brand grew 10% in 2010.0.0

4 4 0.16

4.Pay above average dividends, raising 500% in 2010 to $.90.0.0

5 4 0.25.Has 21 manufacturing / bottle facilities located in the United States, Canada, Mexico, and the Caribbean’s.

0.04 3 0.12

6.Overall Dr. Pepper Snapple group is the #1 company in the flavored CSD market. Dr. Pepper is the #2 flavored CSD and Snapple is the leading ready-to-drink tea.

0.07 4 0.28

7.The Company’s combination of brand ownership, bottling and distribution gives it inherently more control over the value chain and thus a competitive advantage.

0.05 3 0.15

8.Has more than 50 brands under Dr. Pepper Snapple group.0.0

7 4 0.28

9.Dr. Pepper Snapple group's brand is spanning more than 200 years.0.0

4 4 0.16

10.22% increase on EPS.0.0

4 4 0.16

Internal Weaknesses 1 or

2

1.Low market share in Carbonated Beverage industry.0.0

6 1 0.06

2.Does not have low calorie or sports drinks.0.0

5 1 0.05

3.Does not have a strong water brand.0.0

4 1 0.04

4.71% of its volume is distributed by Coca-Cola and PepsiCo.0.0

5 2 0.15.We are not a global company like Pepsi and Coca Cola, only operating in North America and the Caribbean.

0.06 2 0.12

6.Is considered the third top brand for soft drinks.0.0

6 2 0.12

7.Only rank #20 in beverage industry worldwide.0.0

5 1 0.05

8.Too focused on every drink production.0.0

4 1 0.04

9.Wasn't list in top 20 most nutrition beverage company?0.0

6 1 0.06

10.Revenues increased 1.8% in 2010 while net income decreased 5%.0.0

4 1 0.04Totals 1 2.46

Key Internal Factor Weights Rating Weighted

Score


Strategy Formulation


SWOT Matrix


SO Strategies WO Strategies

1. Develop more non-cola, low calorie drinks. (S1, S6, O2)

1. Produce more healthy drink. (W9, O2, O3, O7)

2. Enter new market such as India, China or other Asian countries that has large GDP growth. (S5, O8, O10)

2. Develop sports drink. (W2, O2, O3, O7)

3. Partner with restaurants and fast food chain. (S8,O5)

3. Develop water drink. (W3, O2, O3, O7)

ST Strategies WT Strategies

1. Start to brand off more on Snapple than there soft drinks since Snapple brand is growing and soft drinks are decreasing. (S3,T2,T7)

1. Invest more in healthier products like a sports drink, or flavored water.(W2,W3,T2,T7)

2. Us the advantages of other countries manufacturing facilities to produce products to help avoid taxes on sugar. (S5, S7,T3,T4)

2. The company should be more independent and not really so much on there competitors to sell there products (W4,T6)

3. Us brand threw advertisement with celebrities to help sell product like Snapple, and show that there products are healthy and good for you. (S1,S6,T7,T9)

3. Advertise there other brands more like Snapple, Hawaiian Punch, and Mott’s (W6,W7,T8)

4. Purchase vineyards and produce wine (W7, T2)

Space Matrix



FP

+6

+1

+5

+4

+3

+2

-6

-5

-4

-3

-2

-1-6 -5 -4 -3 -2 -1 +1 +2 +3 +4 +5 +6

SP

CP IP

Conservative Aggressive

Defensive Competitive

Space Matrix

Rapid Growth MarketPossible Strategies:1. Backwards,

Forwards, or Horizontal Integration

2. Market Penetration

3. Market Development

4. Product Development

5. Diversification (Related)

Slow Growth Market

Quadrant II Quadrant I

Quadrant III Quadrant IV

Grand Strategy Matrix


Matrix Analysis


Alternative Strategies


Forward Integration• The company should be more

independent and not really so much on their competitors to sell their products (W4,T6)

Horizontal Integration• Use the advantages of other

countries manufacturing facilities to produce products to help avoid taxes on sugar. (S5, S7,T3,T4)

Market Penetration• Advertise with celebrities to help

sell product like Snapple, and show that there products are healthy and good for you. (S1,S6,T7,T9)

• Advertise their other brands more like Snapple, Hawaiian Punch, and Mott’s (W6,W7,T8)

• Concentrate marketing efforts on Snapple rather than soft drinks since Snapple brand is growing and soft drinks are decreasing. (S3,T2,T7)

Product Development• Develop more non-cola, low calorie

drinks. (S1, S6, O2)

Market Development• Enter new market such as India,

China or other Asian countries that has large GDP growth. (S5, O8, O10)

Related Diversification• Develop sports drink. (W2, O2, O3,

O7)• Produce more healthy drinks. (W9,

O2, O3, O7)• Develop a luxury water. (W3, O2,

O3, O7)• Develop a flavored water.

(W2,W3,T2,T7)• Purchase vineyards and produce

wine. (W7, T2)

QSPM


Develop new

products in non CSD

Create strategic alliances

Purchase vineyards

and produce

wine

Key factors Weight AS TAS AS TAS AS TAS

External 1 to 4 1 to 4 1 to 4Pepsi and Coke distribute other brands globally 0.09 2 0.18 3 0.27 - -Americans are looking for more low/no calorie drinks, this market grew 1.2% in 2010 0.11 4 0.44 - - - -Consumers are looking for nutrient enriched beverages 0.11 4 0.44 - - 2 0.22There are over 300 Soft Drink manufactures 0.06 - - 3 0.18 - -Strategic alliances with restaurants and fast food chains are readily available. 0.07 - - 4 0.28 3 0.21Owning bottling distribution networks reduces cost and dependence on other companies 0.08 1 0.08 3 0.24 3 0.24The US beverage market grew by 0.9 percent in 2011 0.06 1 0.06 2 0.12 - -

U.S consumption of soft drinks in 2011 is the lowest since 1996, The carbonated soft drinks market is expected to decrease 2.2% by 2015 0.08 3 0.24 1 0.08 2 0.16Increasing cost of commodities, especially the volatile sugar industry and sugar tax. 0.11 - - - - 4 0.44Operate in a discretionary item industry, very volatile. 0.10 - - - - - -Highly competitive market. 0.08 1 0.08 4 0.32 1 0.08The health issue with some of their products for example sodas. 0.05 4 0.2 - - 2 0.1

QSPM


Develop new

products in non CSD

Create Strategic alliances

Purchase Vineyards

and produce

wine

Key factorsWeigh

t AS TAS AS TAS AS TASInternalOwns 6 of the top 10 non-cola drinks 0.08 - - 3 0.24 - -9 of their top 12 brands are number 1 in their flavor category 0.08 - - 3 0.24 - -Snapple brand grew 10% in 2010 0.07 3 0.21 - - - -Has 21 manufacturing / bottle facilities located in the United States, Canada, Mexico, and the Caribbean’s . 0.09 - - 2 0.18 1 0.09Overall Dr. Pepper Snapple group is the #1 company in the flavored CSD market. Dr. Pepper is the #2 flavored CSD and Snapple is the leading ready-to-drink tea. 0.09 - - - - - -Has more than 50 brands under Dr. Pepper Snapple group. 0.07 - - 1 0.07 - -

Low market share in Carbonated Beverage industry 0.07 - - 3 0.21 - -Does not have low calorie or sports drinks 0.11 4 0.44 - - - - Does not have a strong water brand 0.1 4 0.4 - - - -71% of its volume is distributed by Coca-Cola and PepsiCo 0.11 - - 4 0.44 - -Is considered the third top brand for soft drinks. 0.07 - - - - - -Only rank #20 in beverage industry worldwide. 0.06 3 0.18 2 0.12 2 0.12

1 2.952.99 1.66

Objective


Continue with the current strategies that the company already has but also:

Expand our brands

Create more strategic alliances

Expand our market share

Increase awareness nutritional line of

products

Look for feasible and equally beneficial

mergers and acquisitions

Strategic


Dr. Pepper Snapple group will invest more in R&D to develop a new sports drink that is high in electrolytes and low in sodium to compete against PowerAde and Gatorade.

Dr. Pepper Snapple Group will seek out new technology to create the purest best tasting artesian/luxury water on the market to compete with FIJI and EVIAN also expand market with current water Deja Blue.

Dr. Pepper Snapple Group will invest in R&D to create a Snapple drink that helps relieve the symptoms of a mild Hangover. It will have caffeine to energize you, natural vitamins to cure headaches and upset stomachs and taste great.

Dr. Pepper Snapple Group will aggressively Market their healthier drinks as the “smart choice” for the refreshment needs.

Dr. Pepper Snapple Group will actively seek out mergers and acquisitions like Red Bull, and Hansen Natural which owns Monster plus others carbonated beverages.

Dr. Pepper Snapple Group will develop low Calorie Soft Drinks

3 Year Goal and Annual Objective


Year 1:• Develop products and test with focus group. $16 million• Increase advertising efforts for our nutritional drinks,

campaign with theme “smart choice” with people like Jillian Michaels or Mario Lopez and other celebrities that are physically fit.

• Develop Social media sites and advertise within and on other sites.

• Purchase more retail space, create alliances with school districts and universities for the smart choice option for their students.

• Search out mergers and acquisitions.Year 2

• Roll out new products with huge marketing campaign. • Finalize merger and acquisitions.• At the end of the year evaluate new products and Smart

Choice Campaign, refocus.Year 3

• Continue to re-evaluate current strategy and adjust for changes to environment.

• Continue to develop and market new products.• Continue to look for mergers and acquisitions

Strategy Selection with Year 1 Cost


Total funding needed to implement new strategies

We are going to double the funding to the R&D department from 16million to 32 million annually.

We are going to increase or advertising budget by 50% from 445 million to 671 million to really push our new products as well as our currently “Smart Choice” products.

Total Cost for recommended strategy $250 million.

EPS/EBIT


Recession Normal Boom

Common Stock FinancingEBIT 800 1,000 1,400 Interest 128 128 128 EBT 672 872 1,272 Taxes 242 314 458 EAT 430 558 814 # Shares 248 248 302 EPS 1.73 2.25 2.70


90% Stock – 10% Debt Financing

EBIT 800 1,000 1,400 Interest 129 129 128 EBT 671 871 1,272 Taxes 241 313 458 EAT 429 557 814 # Shares 247 247 247 EPS 1.74 2.25 3.29


Debt Financing EBIT 800 1,000 1,400 Interest 141 141 141 EBT 660 860 1,260 Taxes 237 309 453 EAT 422 550 806 # Shares 240.4 240.4 240.4 EPS 1.76 2.29 3.35 Recession Normal Boom

90% Debet – 10% StockEBIT 800 1,000 1,400 Interest 139 139 128 EBT 661 861 1,272 Taxes 238 310 458 EAT 423 551 814 # Share 241 241 241 EPS 1.75 2.28 3.38

Close Price for Dr Pepper Snapple 12/31/10 32.71 EPS for Disney on October 11,2011 2.19 Initial Shares Outstanding 240.4 Dividends on Preferred Stock 0.90 Funds Needed 250

90% of Funds Needed 225 10% of Funds Needed 25

Interest Rate 5%Current Tax Rate 36%

ConclusionThe best option for Dr Pepper Snapple is to implement their strategy by financing the entire project. It reflects a higher EPS for the company in all categories with the exception of a boom economy. Given the current economy, we can expect normal earnings.

Projected Income Statement© 2013, Yoshives Belizaire, Zhongling Cao, Shawn Parker, Dave Saucier, UMFK

For the Year Ended December 31,

2009 2010 Projected

2011 Reasoning

(In millions, except per share

data) Net sales $ 5,531 $ 5,636 $6,200 10% IncreaseCost of sales 2,234 2,243 2,480 Average % of 2009-10 (10%)

Gross profit 3,297 3,393 3,720 Selling, general and administrative expenses 2,135 2,233 2,483

Increase 250M (Advertising:220M/R&D:30M)

Depreciation and amortization 117 127 137 8% Increase--New Brand DepreciationImpairment of goodwill and intangible assets — — — Restructuring costs — — — Other operating expense (income), net (40) 8 8

Income (loss) from operations 1,085 1,025 1,092

Interest expense 243

128 141 Additional Interest from Financing 250M--> 13M

Interest income (4) (3) (3) Loss on early extinguishment of debt — 100 — Other income, net (22) (21) (21)

Income (loss) before income taxes and equity in earnings 868 821 975

Provision for income taxes 315 294 351 Average Tax Rate 36%Income (loss) before equity in earnings 553 527 624

Equity in earnings, net of tax 2 1 1 Net income (loss) $ 555 $ 528 $625 Earnings (loss) per common share:

Basic $ 2.18 $ 2.19 $2.60 Diluted $ 2.17 $ 2.17 $2.58

Weighted average common shares outstanding:

Basic 254.2 240.4 240.4 Diluted 255.2 242.6 242.6

Cash dividends declared per common share $ 0.15 $ 0.90 $0.90

Projected Balance Sheet


2009 2010 Projecte

d 2011

ASSETS

Current assets:

Cash and cash equivalents $

280 $ 315 381Fudge #

Accounts receivable: Trade, net 540 536 616Increase 15% (Distribution)Other 32 35 39 Increase 10%

Inventories 262 244 256Increase 5% - New Products (RCI)

Deferred tax assets 53 57 60Increase 5% - New ProductsPrepaid expenses and other current assets 112 122 128Increase 5% - New Products

Total current assets $

1,279 $

1,309 $

1,480

Property, plant and equipment, net 1,109 1,168 1238

6% Increase - Mixing, Bottling, Distribution Space

Investments in unconsolidated subsidiaries 9 11 11 Goodwill 2,983 2,984 2999.5% increase - New ProductOther intangible assets, net 2,702 2,691 2691 Other non-current assets 543 552 563 % Increase of Prior 2 Years (2%)Non-current deferred tax assets 151 144 144

Total assets $

8,776 $

8,859 $

9,126

LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities:

Accounts payable and accrued expenses 850

8518682% Increase (Supply)

Deferred revenue — 65 65 Current portion of long-term obligations —

404454

Increase by 1/5 of 20M (60 month term financing)

Income taxes payable 4 18 18

Total current liabilities $

854 $

1,338 $

1,405 Long-term obligations 2,960 1,687 1,887 Increase by 4/5 of 20M Non-current deferred tax liabilities 1,038 1,083 1,083 Non-current deferred revenue — 1,515 1,515 Other non-current liabilities 737 777 777

Total liabilities $

5,589 $

6,400 $

6,667 Commitments and contingencies Stockholders’ equity: Preferred stock, $.01 par value, 15,000,000 shares authorized, no shares issued —

— —

Common stock, $.01 par value, 800,000,000 shares authorized, 223,936,156 and 254,109,047 shares issued and outstanding for 2010 and 2009, respectively 3

2

2 Additional paid-in capital 3,156 2,085 2,085 Retained earnings 87 400 400 Accumulated other comprehensive loss

(59)

(28) (28)

Total stockholders’ equity $

3,187

2,459

2,459 Total liabilities and stockholders’ equity

$ 8,776

$ 8,859

$ 9,126

Projected Balance Sheet 2009

2010Projected

2011

Projected Ratios


Dr Pepper Snapple

2010Projecte

dLiquidity RatiosCurrent Ratio 0.98 1.05 Quick Ratio 0.80 0.85 Leverage RatiosDebt-to-Total Assets Ratio 0.72 0.73 Debt-to-Equity Ratio 2.60 2.71 Long-Term Debt-to-Equity Ratio 0.69 0.77 Times-Interest-Earned Ratio 8.01 6.91 Profitability RatiosGross Profit Margin 0.60 0.60 Operating Profit Margin 0.18 0.18 Return on Total Assets 5.96% 6.84%Return on Stockholders' Equity 21.47% 25.38%Earnings per Share 2.20 2.60 Growth Rations (yearly from previous)Sales 1.90% 10.01%Net Income -4.86% 18.18%Earnings per Share 0.46% 25.11%

Strategic Evaluation


How are we going to evaluate or strategy?Through KPI’s - Market share increase in targeted areas of at least

3% annually- Revenue increase of at least 10% annually- Increase in customer satisfaction in taste tests- Social media footprint, increase views and likes 5

fold annually. - Increase of 15% EPS annually- Increase of at least $.02 dividend quarterly to

investors. - At least one acquisition bi-annually in distribution

and beverage market.

Stock Performance


Update


Introduction of Dr. Pepper Ten and other brands, http://youtu.be/2l5OVWZ7QWEConsistent revenue, EPS and net income gains by increasing store placement and promotions designed at the on-the-go driver DPS has 13 of 14 leading brands are number 1 or 2 in their flavor categoryReturned 684 million back to shareholders in 2012, 400 million in buyback and 284 in dividends. Increased dividend for the 5th time since going public.Since 2011 RCI has reduced days sale of inventory by 40%, and closed 10 outside warehouses freeing up resources to grow the business. They also have cut the fleet delivery miles by more than 1 million, removing 3.7 millions pounds of greenhouse gas emissions from the atmosphere.

http://youtu.be/2l5OVWZ7QWE



Questions??

Documents

Yoshives Belizaire Zhongling Cao Shawn Parker Dave Saucier © 2013, Yoshives Belizaire, Zhongling Cao, Shawn Parker, Dave Saucier, UMFK