Which company had higher operating leverage

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Reference no: EM131328426

In its 2006 annual report, The Coca-Cola Company reported sales of $24.09 billion for fiscal year 2006 and $23.10 billion for fiscal year 2005. The company also reported operating income (roughly equivalent to EBIT) of $6.31 billion, and $6.09 billion in 2005 and 2006, respectively.

Meanwhile, arch-rival PepsiCo, Inc. reported sales of $35.14 billion in 2006 and $32.56 billion in 2005.

PepsiCo's operating profit was $6.44 billion in 2006 and $5.92 billion in 2005. Based on these figures, which company had higher operating leverage?

Reference no: EM131328426

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