Fitch Affirms Pepsi Bottling Group's IDR at 'A+'

Fitch Ratings has affirmed the following ratings of The Pepsi Bottling Group, Inc. and its subsidiary.

Pepsi Bottling Group, Inc.

- Long-term Issuer Default Rating (IDR) at 'A+';

- Short-term IDR at 'F1';

- Bank credit facility at 'A+';

- Senior unsecured debt at 'A+';

- Commercial paper (CP) 'F1'.

Bottling Group, LLC

- IDR 'A+';

- Senior unsecured debt 'A+';

- Guaranteed Senior Notes 'AA-'.

The rating outlook is stable. This rating action affects approximately $5.4 billion of debt.

The affirmation reflects PBG's importance within the PepsiCo bottling system, its strengthening beverage portfolio (with its distribution agreement for G2), and its fast-growing Russian businesses.

The ratings also acknowledge the declining carbonated soft drink (CSD) volumes in the U.S., given the prominence of CSDs in PBG's beverage portfolio and the high percentage of revenues derived from the US market.

Despite a difficult commodity cost environment, which is pressuring the company's margins, PBG continues to produce significant free cash flow.