FORM 10-Q
                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

(Mark One)
 X QUARTERLY  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE
---
ACT OF 1934 For the quarterly period ended June 10, 2000 (24-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  1-14893
                        -------




                         THE PEPSI BOTTLING GROUP, INC.
                         ------------------------------
             (Exact name of registrant as specified in its charter)

            Delaware                                             13-4038356
            --------                                             ----------
(State or other jurisdiction of                                    (I.R.S.
Employer incorporate or organization)                        Identification No.)

     One Pepsi Way, Somers, New York                                10589
     -------------------------------                                -----
(Address of principal executive offices)                         (Zip Code)

                                  914-767-6000
                                  ------------
              (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
     ---      ---

Number of shares of Common Stock outstanding as of July 7, 2000:
146,960,318


<PAGE>


                         The Pepsi Bottling Group, Inc.
                                      Index
<TABLE>
<CAPTION>

                                                                                           Page No.
                                                                                           --------
<S>                                                                                          <C>

Part I                Financial Information

        Item 1.       Financial Statements

                      Condensed Consolidated Statements of Operations -
                           12 and 24-weeks ended June 10, 2000 and June 12, 1999               2

                      Condensed Consolidated Statements of Cash Flows -
                           24-weeks ended June 10, 2000 and June 12, 1999                      3

                      Condensed Consolidated Balance Sheets -
                           June 10, 2000 and December 25, 1999                                 4

                      Notes to Condensed Consolidated Financial Statements                     5-8

        Item 2.       Management's Discussion and Analysis of Results of
                           Operations and Financial Condition                                  9-14

        Item 3.       Quantitative and Qualitative Disclosures About
                           Market Risk                                                         14

                      Independent Accountants' Review Report                                   15

Part II               Other Information and Signatures

        Item 6.       Exhibits                                                                 16

</TABLE>


                                       -1-



                         PART I - FINANCIAL INFORMATION
     Item 1.
                         The Pepsi Bottling Group, Inc.
                 Condensed Consolidated Statements of Operations
                 in millions except per share amounts, unaudited

<TABLE>
<CAPTION>
                                                                         12-weeks Ended              24-weeks Ended
                                                                    June 10,       June 12,      June 10,     June 12,
                                                                      2000           1999          2000         1999
                                                                      ----           ----          ----         ----

<S>                                                                 <C>           <C>            <C>           <C>
     Net Revenues................................................   $1,913         $1,831        $3,458        $3,283
     Cost of sales...............................................    1,033          1,046         1,878         1,881
                                                                    ------         ------        ------        ------

     Gross Profit................................................      880            785         1,580         1,402
     Selling, delivery and administrative expenses...............      689            648         1,314         1,223
     Non-cash compensation charge................................        -             45             -            45
                                                                    ------         ------        ------        ------

     Operating Income............................................      191             92           266           134
     Interest expense, net.......................................       44             51            89            97
     Foreign currency gain.......................................        -             (1)            -             -
     Minority interest...........................................       12              7            15             7
                                                                    ------         ------        ------        ------
     Income before income taxes..................................      135             35           162            30
     Income tax expense..........................................       50             15            60            13
                                                                    ------         ------        ------        ------

     Net Income..................................................   $   85         $   20        $  102        $   17
                                                                    ======         ======        ======        ======

     Basic and Diluted Earnings Per Share
     As reported.................................................   $ 0.58         $ 0.14        $ 0.69        $ 0.18
     Weighted-Average Basic and Diluted Shares
      Outstanding................................................      148            142           148            98

     Pro Forma Basic and Diluted Earnings Per Share
     As reported.................................................   $ 0.58         $ 0.13        $ 0.69        $ 0.11
     Excluding non-cash compensation charge......................   $ 0.58         $ 0.32        $ 0.69        $ 0.30
     Weighted-Average Basic and Diluted Shares
       Outstanding...............................................      148            155           148           155


     See accompanying notes to Condensed Consolidated Financial Statements.

</TABLE>



                                       -2-



                         The Pepsi Bottling Group, Inc.
                 Condensed Consolidated Statements of Cash Flows
                             in millions, unaudited
<TABLE>
<CAPTION>
                                                                                               24-weeks Ended
                                                                                           June 10,        June 12,
                                                                                             2000            1999
                                                                                             -----           ----
    Cash Flows - Operations
<S>                                                                                           <C>            <C>
      Net income......................................................................      $  102          $  17
      Adjustments to reconcile net income to net cash provided by operations:
            Depreciation..............................................................         153            164
            Amortization..............................................................          61             59
            Deferred income taxes.....................................................         (14)            (2)
            Non-cash compensation charge..............................................           -             29
            Other non-cash charges and credits, net...................................          78             57
            Changes in operating working capital, excluding effects of
                acquisitions;
              Trade accounts receivable...............................................        (177)          (182)
              Inventories.............................................................         (49)           (44)
              Prepaid expenses, deferred income taxes and other current assets........         (10)           (20)
              Accounts payable and other current liabilities..........................         104             93
                                                                                            ------         ------
            Net change in operating working capital ..................................        (132)          (153)
                                                                                            ------         ------

    Net Cash Provided by Operations...................................................         248            171
                                                                                            ------         ------

    Cash Flows - Investments
       Capital expenditures...........................................................        (224)          (232)
       Acquisitions of bottlers.......................................................          (2)          (165)
       Other, net.....................................................................          (4)            21
                                                                                            ------         ------

    Net Cash Used by Investments......................................................        (230)          (376)
                                                                                            ------         ------

    Cash Flows - Financing
       Short-term borrowings - three months or less...................................           7            (66)
       Proceeds from third-party debt.................................................           -          3,260
       Replacement of PepsiCo allocated debt..........................................           -         (3,300)
       Payments of third-party debt...................................................          (8)           (41)
       Dividends paid.................................................................          (6)             -
       Treasury stock transactions....................................................         (58)             -
       Net IPO proceeds...............................................................           -          2,208
       Decrease in advances from PepsiCo..............................................           -         (1,834)
                                                                                            ------         ------

    Net Cash (Used) Provided by Financing.............................................         (65)           227
                                                                                            ------         ------

    Effect of Exchange Rate Changes on Cash and Cash Equivalents......................          (3)            (1)
                                                                                            ------         ------
    Net (Decrease) Increase  in Cash and Cash Equivalents.............................         (50)            21
    Cash and Cash Equivalents - Beginning of Period...................................         190             36
                                                                                            ------         ------
    Cash and Cash Equivalents - End of Period.........................................      $  140         $   57
                                                                                            ======         ======
    Supplemental Cash Flow Information
    Third-party interest and income taxes paid........................................      $  164         $    2
                                                                                            ======         ======
     See accompanying notes to Condensed Consolidated Financial Statements.
</TABLE>


                                      -3-



                         The Pepsi Bottling Group, Inc.
                      Condensed Consolidated Balance Sheets
                      in millions, except per share amounts
<TABLE>
<CAPTION>
                                                                                   (Unaudited)
                                                                                       June         December
                                                                                     10, 2000       25, 1999
                                                                                     --------       --------
Assets
------
Current Assets
<S>                                                                                   <C>            <C>
  Cash and cash equivalents................................................          $  140         $  190
  Trade accounts receivable, less allowance of $48 at
        June 10, 2000 and December 25, 1999................................             977            827
  Inventories..............................................................             340            293
  Prepaid expenses, deferred income taxes and other current assets.........             165            183
                                                                                     ------         ------
          Total Current Assets.............................................           1,622          1,493

Property, plant and equipment, net.........................................           2,270          2,218
Intangible assets, net.....................................................           3,758          3,819
Other assets...............................................................              80             89
                                                                                     ------         ------
           Total Assets....................................................          $7,730         $7,619
                                                                                     ======         ======

Liabilities and Shareholders' Equity
------------------------------------
Current Liabilities
  Accounts payable and other current liabilities...........................          $1,026         $  924
  Short-term borrowings....................................................              22             23
                                                                                     ------         ------
          Total Current Liabilities........................................           1,048            947

Long-term debt.............................................................           3,269          3,268
Other liabilities..........................................................             418            385
Deferred income taxes......................................................           1,124          1,178
Minority interest..........................................................             291            278
                                                                                     ------         ------
          Total Liabilities................................................           6,150          6,056

Shareholders' Equity
   Common stock, par value $.01 per share:
       Authorized 300 shares, issued 155 shares............................               2              2
   Additional paid-in capital..............................................           1,736          1,736
   Retained earnings.......................................................             234            138
   Accumulated other comprehensive loss....................................            (244)          (223)
   Treasury stock: 8 shares and 5 shares at June 10, 2000 and December 25,
      1999, respectively...................................................            (148)           (90)
                                                                                     ------         ------
          Total Shareholders' Equity.......................................           1,580          1,563
                                                                                     ------         ------
           Total Liabilities and Shareholders' Equity......................          $7,730         $7,619
                                                                                     ======         ======

     See accompanying notes to Condensed Consolidated Financial Statements.
</TABLE>



                                       -4-



The Pepsi Bottling Group, Inc.
Notes to Condensed Consolidated Financial Statements (unaudited)
Tabular dollars in millions

--------------------------------------------------------------------------------

Note 1 - Basis of Presentation
     The Pepsi Bottling  Group,  Inc.  ("PBG")  consists of bottling  operations
located in the United States,  Canada,  Spain, Greece and Russia. These bottling
operations  manufacture,  sell and  distribute  Pepsi-Cola  beverages  including
Pepsi-Cola,  Diet Pepsi, Mountain Dew and other brands of carbonated soft drinks
and other ready-to-drink beverages. Approximately 90% of PBG's net revenues were
derived from the sale of  Pepsi-Cola  beverages.  References  to PBG  throughout
these   Condensed   Consolidated   Financial   Statements  are  made  using  the
first-person notations of "we," "our" and "us."

     Prior  to our  formation,  we  were an  operating  unit  of  PepsiCo,  Inc.
("PepsiCo").  On March 31,  1999,  we offered  100,000,000  shares of PBG common
stock for sale at $23 per share in an initial public offering  generating $2,208
million  in net  proceeds.  These  proceeds  were used to repay  obligations  to
PepsiCo and fund  acquisitions.  Subsequent to the  offering,  PepsiCo owned and
continues to own  55,005,679  shares of common  stock,  consisting of 54,917,329
shares of common  stock and  88,350  shares of Class B common  stock.  PepsiCo's
ownership  has  increased to 37.4% of the  outstanding  common stock at June 10,
2000 as a result  of net  repurchases  of 8.1  million  shares  under  our share
repurchase  program,  which began in October 1999. PepsiCo also owns 100% of the
outstanding  Class B common  stock,  together  representing  45.6% of the voting
power of all classes of our voting stock.  Subsequent  to the offering,  PepsiCo
also owns 7.1% of the equity of Bottling  Group,  LLC, our  principal  operating
subsidiary,   giving  PepsiCo  economic  ownership  of  41.9%  of  our  combined
operations at June 10, 2000.

     The  accompanying   Condensed  Consolidated  Financial  Statements  include
information that has been presented on a "carve-out" basis for the periods prior
to our initial public offering. This information includes the historical results
of operations and assets and liabilities  directly  related to PBG, and has been
prepared  from  PepsiCo's  historical  accounting  records.  Certain  estimates,
assumptions and allocations  were made in determining  such financial  statement
information.  Therefore,  these Condensed  Consolidated Financial Statements may
not necessarily be indicative of the results of operations,  financial  position
or cash  flows  that  would have  existed  had we been a  separate,  independent
company from the first day of all periods presented.

     The accompanying Condensed Consolidated Balance Sheet at June 10, 2000, the
Condensed  Consolidated  Statements of Operations  for the 12 and 24-weeks ended
June 10, 2000 and June 12, 1999 and the  Condensed  Consolidated  Statements  of
Cash Flows for the 24-weeks  ended June 10, 2000 and June 12, 1999 have not been
audited, but have been prepared in conformity with generally accepted accounting
principles for interim  financial  information and with the instructions to Form
10-Q and Article 10 of Regulation  S-X. These Condensed  Consolidated  Financial
Statements should be read in conjunction with the audited consolidated financial
statements  for the year ended  December  25,  1999 as  presented  in our Annual
Report on Form 10-K.  In the opinion of  management,  this  interim  information
includes all material  adjustments,  which are of a normal and recurring nature,
necessary for a fair presentation.



                                       -5-



Note 2 - Seasonality of Business
     The results for the second quarter and first  24-weeks are not  necessarily
indicative  of the  results  that may be expected  for the full year  because of
business  seasonality.  The  seasonality  of our operating  results  arises from
higher  sales in the  second  and third  quarters  versus  the first and  fourth
quarters  of the  year,  combined  with  the  impact  of  fixed  costs,  such as
depreciation, amortization and interest, which are not significantly impacted by
business seasonality.

Note 3 - Inventories
                                                         June           December
                                                       10, 2000         25, 1999
                                                       --------         --------

Raw materials and supplies.........................    $  125           $  110
Finished goods.....................................       215              183
                                                       ------           ------
                                                       $  340           $  293
                                                       ======           ======

Note 4 - Property, Plant and Equipment, net
                                                         June           December
                                                       10, 2000         25, 1999
                                                       --------         --------

Land...............................................    $  144           $  145
Buildings and improvements.........................       862              852
Production and distribution equipment..............     2,148            2,112
Marketing equipment................................     1,667            1,596
Other..............................................        86               84
                                                       ------           ------
                                                        4,907            4,789
Accumulated depreciation...........................    (2,637)          (2,571)
                                                       ------           ------
                                                       $2,270           $2,218
                                                       ======           ======

Note 5 - Comprehensive Income
<TABLE>
<CAPTION>
                                                            12-weeks Ended              24-weeks Ended
                                                         June             June        June          June
                                                       10, 2000         12, 1999    10, 2000      12, 1999
                                                       --------         --------    --------      --------

<S>                                                      <C>              <C>          <C>            <C>
Net income.........................................    $  85            $  20       $ 102         $  17
Currency translation adjustment....................       (8)              (7)        (21)            4
Minimum pension liability adjustment...............        -               19           -            19
                                                       -----            -----       -----         -----

Comprehensive Income...............................    $  77            $  32       $  81         $  40
                                                       =====            =====       =====         =====
</TABLE>



                                       -6-



Note 6 - Comparability of Results
Asset Lives
-----------
     At the beginning of fiscal year 2000, we changed the estimated useful lives
of  certain  categories  of assets  primarily  to  reflect  the  success  of our
preventive  maintenance  programs in extending the useful lives of these assets.
The changes,  which are detailed in the table below,  lowered total depreciation
cost by $18 million,  or $0.07 per share,  and $32 million,  or $0.12 per share,
for the 12 and 24-weeks ended June 10, 2000, respectively.

                                                          Estimated Useful Lives
                                                            2000           1999
                                                            ----           ----
Manufacturing equipment.................................     15             10
Heavy fleet.............................................     10              8
Fountain dispensing equipment...........................      7              5
Small specialty coolers and marketing equipment.........      3         5 to 7

Initial Public Offering
-----------------------
     The 1999 financial  information  for the period prior to our initial public
offering has been carved out from the financial  statements of PepsiCo using the
historical results of operations and assets and liabilities of our business. The
Condensed  Consolidated  Financial Statements reflect certain costs that may not
necessarily be indicative of the costs we would have incurred had we operated as
an  independent,  stand-alone  entity from the  beginning  of 1999.  These costs
include an allocation of PepsiCo corporate  overhead and interest  expense,  and
income taxes.

o         We  included  corporate   overhead  related  to  PepsiCo's   corporate
          administrative   functions  based  on  a  specific  identification  of
          PepsiCo's  administrative  costs  relating to the bottling  operations
          and, to the extent that such identification was not practicable, based
          upon the  percentage  of our  revenues to PepsiCo's  consolidated  net
          revenues.   These  costs  are   included  in  selling,   delivery  and
          administrative  expenses in our Condensed  Consolidated  Statements of
          Operations.

o         We allocated $3.3 billion of PepsiCo debt to our business.  We charged
          interest  expense  on  this  debt  using  PepsiCo's   weighted-average
          interest rate. Once we issued $3.3 billion of third-party  debt in the
          first  quarter  of  1999,  our  actual  interest  rates  were  used to
          determine  interest  expense for the remainder of the year.  Allocated
          interest expense was deemed to have been paid to PepsiCo,  in cash, in
          the period in which the cost was incurred.

o         We  reflected  income  tax  expense  in  our  Condensed   Consolidated
          Financial Statements as if we had actually filed a separate income tax
          return.  Our  allocable  share of income taxes was deemed to have been
          paid to  PepsiCo,  in  cash,  in the  period  in  which  the  cost was
          incurred.



                                       -7-




     The amounts of the historical allocations described above are as follows:

                                                                           1999
                                                                           ----
     Corporate overhead expense......................................      $  3
     Interest expense................................................      $ 28
     PepsiCo weighted-average interest rate..........................      5.8%


     In addition,  our historical capital structure is not representative of our
current  structure  due to our initial  public  offering.  In 1999,  immediately
preceding the offering, we had 55,000,000 shares of common stock outstanding. In
connection  with the offering,  we sold  100,000,000  shares to the public.  Pro
forma 1999 average shares outstanding  reflect our initial public offering as if
it occurred on the first day of fiscal year 1999.

Note 7 - Non-cash Compensation Charge
     In  connection  with  the  consummation  of our  initial  public  offering,
substantially all non-vested PepsiCo stock options held by our employees vested.
As a result,  we  incurred a $45  million  non-cash  compensation  charge in the
second  quarter of 1999 ($29  million  after tax or $0.19 per share based on pro
forma weighted average shares outstanding),  equal to the difference between the
market  price of the  PepsiCo  capital  stock  and the  exercise  price of these
options at the vesting date.

Note 8 - Subsequent Events
     On June 12, 2000,  union employees at our Burnsville,  Minnesota plant went
on strike over  employment  contract  disputes.  At this time we are not able to
determine  how long the strike will last. We do not believe the strike will have
a significant financial impact on our overall results.



                                       -8-



Item 2.

Management's  Discussion  and Analysis of Results of  Operations  and  Financial
--------------------------------------------------------------------------------
Condition Overview
------------------
     Just over 15 months  ago,  The Pepsi  Bottling  Group,  Inc.  (collectively
referred to as "PBG," "we," "our" and "us") became a public  company  through an
initial  public  offering  of  100,000,000  shares  of common  stock.  Since our
separation  from PepsiCo,  Inc. and our beginning as a company focused solely on
the bottling business we have concentrated our efforts on three key objectives -
fixing  the  economics  of our  take-home  business,  aggressively  growing  our
high-margin cold drink volume and sharply improving our international  business.
As we complete the first half of 2000, we are proud of our  performance  against
these objectives as we have continued to generate outstanding operating results:

o    We delivered  18% and 19% constant  territory  EBITDA  growth in the second
     quarter and first 24-weeks of 2000, respectively.

o    We delivered $0.58 in earnings per share in the second quarter, an increase
     of $0.26 over 1999 after adjusting for the number of shares outstanding and
     excluding a 1999 non-cash  compensation  charge.  On a year-to-date  basis,
     earnings per share more than doubled to $0.69.

o    We generated $20 million of operating  free cash flow in the first 24-weeks
     of 2000, $60 million better than the prior year.

     The  following  management's  discussion  and  analysis  should  be read in
conjunction   with  our  Condensed   Consolidated   Financial   Statements   and
accompanying  footnotes along with the cautionary  statements at the end of this
section.

Constant Territory
     We  believe  that  constant  territory  performance  results  are the  most
appropriate  indicators of operating  trends and  performance,  particularly  in
light of our stated intention of acquiring additional bottling territories,  and
are consistent with industry practice.  Constant territory operating results are
achieved by adjusting current year results to exclude  significant  current year
acquisitions  and  adjusting  prior  year  results  to  include  the  results of
significant  prior year acquisitions as if they had occurred on the first day of
the prior  fiscal  year.  Constant  territory  results  also exclude any unusual
impairment and other charges and credits.

Use of EBITDA
     EBITDA, which is computed as operating income plus the sum of depreciation,
amortization and any unusual  non-cash  charges and credits,  is a key indicator
management and the industry use to evaluate  operating  performance.  It is not,
however,  required under generally accepted accounting principles and should not
be considered an alternative to measurements required by GAAP such as net income
or cash flows.



                                       -9-



Comparability of Results
Asset Lives
-----------
     At the beginning of fiscal year 2000, we changed the estimated useful lives
of  certain  categories  of assets  primarily  to  reflect  the  success  of our
preventive  maintenance  programs in extending the useful lives of these assets.
The  changes,  which  are  detailed  in  Note  6 to the  Condensed  Consolidated
Financial  Statements,  lowered total depreciation cost by $18 million, or $0.07
per share,  and $32 million,  or $0.12 per share,  for the 12 and 24-weeks ended
June 10, 2000,  respectively.  We  anticipate  that this change will reduce full
year 2000 depreciation  expense by approximately $70 million equivalent to $0.27
per share.

Initial Public Offering
-----------------------
     The 1999 financial  information  for the period prior to our initial public
offering has been carved out from the financial  statements of PepsiCo using the
historical results of operations and assets and liabilities of our business. The
Condensed  Consolidated  Financial Statements reflect certain costs that may not
necessarily be indicative of the costs we would have incurred had we operated as
an  independent,  stand-alone  entity from the  beginning  of 1999.  These costs
include an allocation of PepsiCo corporate  overhead and interest  expense,  and
income  taxes.  We reflected  income tax expense in the  Condensed  Consolidated
Financial  Statements as if we had actually  filed a separate  income tax return
and allocated overhead and interest expense as follows:

                                                                           1999
                                                                           ----
     Corporate overhead expense.....................................       $  3
     Interest expense...............................................       $ 28
     PepsiCo weighted-average interest rate.........................        5.8%

     In addition,  our historical capital structure is not representative of our
current  structure  due to our initial  public  offering.  In 1999,  immediately
preceding the offering, we had 55,000,000 shares of common stock outstanding. In
connection with the offering, we sold 100,000,000 shares to the public.
Results of Operations
<TABLE>
<CAPTION>
                                               Reported Change       Constant Territory Change
                                                June 10, 2000              June 10, 2000
                                           12-weeks       24-weeks    12-weeks        24-weeks
                                           --------       --------    --------        --------
<S>                                          <C>            <C>          <C>             <C>
     EBITDA.............................     18%            19%          18%             19%
     Volume..............................     0%             0%           0%              0%
     Net Revenue per Case................     4%             5%           4%              5%
</TABLE>

EBITDA
     Reported EBITDA was $299 million and $480 million in the second quarter and
first 24-weeks of 2000, respectively,  representing an 18% and 19% increase over
the same periods of 1999. On a constant territory basis,  EBITDA growth was also
18% and 19% over the same periods reflecting strong pricing in U.S.  foodstores,
an increased mix of higher margin cold drink volume and continued  growth in our
operations outside the U.S.



                                      -10-



Volume
     Our worldwide physical case volume was flat on both a reported and constant
territory  basis in the second  quarter and first 24-weeks of 2000. For both the
second  quarter  and first  24-weeks of 2000,  U.S.  constant  territory  volume
decreased 1% driven by declines in the take-home  segment  resulting  from price
increases and the lapping of a very successful Star Wars promotional  program in
the second quarter of 1999.  While  take-home  volume was lower, we were able to
make up some of the lost volume in our cold drink  segment as we continued to be
successful  in placing  cold drink  equipment  and in growing  our small  format
channels.

     Outside  the U.S.,  our  constant  territory  volumes  increased  7% in the
quarter and 6%  year-to-date  reflecting  continued  improvements  in Russia and
solid growth in Spain.  Russia volumes continued to rebound from the August 1998
devaluation  of the ruble as we have  aggressively  reestablished  brand  Pepsi,
introduced our own line of value brand beverage  products (Fiesta) and continued
to increase distribution of our water products.  Partially offsetting the growth
in Russia and Spain were volume  declines in Canada  resulting from  significant
price increases in foodstores in that country.

Net Revenues
     Net revenues for the quarter were $1,913  million,  a more than 4% increase
over the prior year, raising  year-to-date net revenues by 5% to $3,458 million.
On a constant  territory basis,  worldwide net revenues and net revenue per case
grew 4% and 5% in the quarter and for the first  24-weeks,  respectively.  These
increases were driven by strong pricing, particularly in U.S. foodstores, and an
increased mix of higher-revenue cold drink volume. Reported net revenues and net
revenue per case were lowered by approximately 1% due to currency translation in
both the quarter and 24-weeks ended June 10, 2000.

Cost of Sales
     Cost of sales  decreased $13 million,  or 1%, in the second  quarter and $3
million,  or  essentially  flat,  in the first half of 2000.  Current year costs
include a $9 million  and $17  million  favorable  impact from the change in our
estimated useful lives of  manufacturing  assets in the second quarter and first
24-weeks of 2000, respectively.  Currency translations also had an approximately
1% favorable  impact on the second quarter and year-to-date  results.  Excluding
the effects of the change in depreciation lives and currency translations,  cost
of sales  were 1%  higher  in the  quarter  and  year-to-date,  as  higher  U.S.
concentrate  costs were  partially  offset by favorable  packaging and sweetener
costs.

Selling, delivery and administrative expenses
     Selling,  delivery and administrative  expenses grew $41 million, or 6%, in
the second quarter, bringing year-to-date growth to $91 million, or 7%, over the
comparable  periods in 1999. This increase primarily reflects higher selling and
delivery costs as we continued to  aggressively  place cold drink  equipment and
invest  in this  high  margin  segment  of our  business.  In  addition,  higher
performance  based  compensation  costs and costs associated with our previously
announced 401(k) plan  contributed  approximately 4 points of the cost growth in
the quarter and 3 points of the cost growth  year-to-date.  Currency translation
and the  depreciation  accounting  change partially offset these cost increases.
Currency  translations  had an  approximately  1%  favorable  impact in both the
quarter  and  24-weeks  ended June 10,  2000.  Current  year costs  include a $9
million and $15 million favorable impact from the change in our estimated useful
lives of certain  selling and  delivery  assets in the second  quarter and first
24-weeks of 2000, respectively.




                                      -11-



Interest expense, net
     Interest  expense  decreased by $7 million in the quarter and $8 million in
the first half of 2000 primarily reflecting lower external debt outside the U.S.

Non-cash Compensation Charge
     In  connection  with  the  consummation  of our  initial  public  offering,
substantially all non-vested PepsiCo stock options held by our employees vested.
As a result,  we  incurred a $45  million  non-cash  compensation  charge in the
second  quarter of 1999 ($29  million  after tax or $0.19 per share based on pro
forma weighted average shares outstanding),  equal to the difference between the
market  price of the  PepsiCo  capital  stock  and the  exercise  price of these
options at the vesting date.

Minority Interest
     PBG and  PepsiCo  contributed  bottling  businesses  and assets used in the
bottling businesses to Bottling Group, LLC, our principal operating  subsidiary,
in  connection  with the  formation of Bottling  Group,  LLC. As a result of the
contribution of these assets,  we own 92.9% of Bottling  Group,  LLC and PepsiCo
owns the remaining 7.1%. Accordingly,  starting from our initial public offering
on March 31, 1999,  our  Condensed  Consolidated  Financial  Statements  reflect
PepsiCo's  share of consolidated  net income of Bottling Group,  LLC as minority
interest in our Condensed Consolidated Statements of Operations.

Provision for Income Taxes
     Our full  year  forecasted  tax rate for 2000 is 37% and this rate has been
applied to our 2000  results.  This rate  corresponds  to an effective tax rate,
excluding any unusual impairment and other charges and credits,  of 38% in 1999.
The  one  point  decrease  is  primarily  due to the  reduced  impact  of  fixed
non-deductible permanent expenses on higher anticipated pre-tax income in 2000.

Earnings Per Share
<TABLE>
<CAPTION>

                                                              12-weeks Ended        24-weeks Ended
                                                            June        June       June        June
                                                          10, 2000    12, 1999   10, 2000    12, 1999
                                                          --------    --------   --------    --------
<S>                                                         <C>         <C>        <C>         <C>
       Earnings per share on reported net income.....     $ 0.58      $ 0.14     $ 0.69      $ 0.18
       Average shares outstanding (millions).........        148         142        148          98
</TABLE>

     Our  historical  capital  structure  is not  representative  of our current
structure due to our initial public offering. In 1999, immediately preceding the
offering,  we had 55 million shares of common stock  outstanding.  In connection
with the offering,  we sold 100,000,000 shares of common stock to the public and
used the $2.2  billion of proceeds to repay  obligations  to PepsiCo and to fund
acquisitions.




                                      -12-




     The table below sets forth 1999 earnings per share adjusted for the initial
public offering  assuming 155 million shares had been outstanding for the entire
period  presented.  Shares  outstanding  in 2000  reflect  our share  repurchase
program,  which began in October 1999 when our Board of Directors authorized the
repurchase of up to 10 million shares of our common stock. In the second quarter
of 2000,  our Board of Directors  authorized  the  repurchase of an additional 5
million shares.  Approximately 1.3 million shares were repurchased in the second
quarter  of 2000 with a total of over 8 million  shares  repurchased  since last
October.
<TABLE>
<CAPTION>

                                                             12-weeks Ended          24-weeks Ended
                                                            June        June        June        June
                                                          10, 2000    12, 1999    10, 2000    12, 1999
                                                          --------    --------    --------    --------
<S>                                                          <C>         <C>         <C>         <C>
    Earnings per share on reported net income........     $ 0.58      $ 0.13      $ 0.69      $ 0.11
    Pro Forma average shares outstanding (millions)..        148         155         148         155
</TABLE>

Liquidity and Capital Resources
-------------------------------
Cash Flows
     Net cash  provided by operating  activities  increased  $77 million to $248
million in the first  24-weeks of 2000 as strong  EBITDA  growth  combined  with
improved  working  capital cash flows  driven by the timing of cash  payments on
current liabilities.

     Net cash used by investments decreased by $146 million from $376 million at
the end of the second  quarter of 1999 to $230 million in the first  24-weeks of
2000,  primarily due to  acquisition  spending,  which was $163 million lower in
2000. Capital  expenditures  decreased by $8 million, or 3%, as increases in the
U.S.  associated  with our cold drink strategy were offset by decreases  outside
the U.S.  Our 2000 net  marketing  equipment  placements  through the end of the
second  quarter were made at a rate which should allow us to meet our 2000 North
American target of 150,000 net placements compared to 142,000 in 1999.

     Net cash  (used)  provided  by  financing  decreased  from a source of $227
million in 1999 to a use of $65 million in 2000. This decrease resulted from net
cash  received  from IPO  activities  in 1999  coupled with $58 million of share
repurchases in 2000.

Euro
----
     On  January  1,  1999,  eleven  member  countries  of  the  European  Union
established  fixed conversion  rates between existing  currencies and one common
currency,  the Euro. Beginning in January 2002, new  Euro-denominated  bills and
coins  will  be  issued,   and  existing   currencies  will  be  withdrawn  from
circulation.  Spain is one of the member  countries that instituted the Euro and
we have  established  plans to address  the issues  raised by the Euro  currency
conversion.  These issues include,  among others, the need to adapt computer and
financial systems,  business processes and equipment,  such as vending machines,
to  accommodate  Euro-denominated  transactions  and the  impact  of one  common
currency  on  cross-border  pricing.   Since  financial  systems  and  processes
currently  accommodate  multiple  currencies,  we do not  expect  the system and
equipment  conversion costs to be material.  Due to numerous  uncertainties,  we
cannot reasonably estimate the long-term effects one common currency may have on
pricing,  costs and the resulting impact, if any, on the financial  condition or
results of operations.



                                      -13-




Cautionary Statements
---------------------
     Except for the historical  information  and discussions  contained  herein,
statements contained in this Form 10-Q may constitute forward-looking statements
as defined  by the  Private  Securities  Litigation  Reform  Act of 1995.  These
forward-looking   statements  are  based  on  currently  available  competitive,
financial and economic data and our operating plans.  These statements involve a
number of risks, uncertainties and other factors that could cause actual results
to be  materially  different.  Among the  events  and  uncertainties  that could
adversely affect future periods are  lower-than-expected  net pricing  resulting
from marketplace competition,  material changes from expectations in the cost of
raw materials and  ingredients,  an inability to achieve the expected timing for
returns  on cold  drink  equipment  and  employee  infrastructure  expenditures,
material changes in expected levels of marketing  support payments from PepsiCo,
Inc.,  an  inability  to meet  projections  for  performance  in newly  acquired
territories,  unexpected costs associated with conversion to the common European
currency and unfavorable interest rate and currency fluctuations.

Item 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     We have no material  changes to the disclosures  made on this matter in our
1999 Annual Report on Form 10-K.



                                      -14-




                     Independent Accountants' Review Report
                     --------------------------------------

The Board of Directors
The Pepsi Bottling Group, Inc.

We have reviewed the accompanying  Condensed  Consolidated  Balance Sheet of The
Pepsi  Bottling  Group,  Inc. as of June 10,  2000,  and the  related  Condensed
Consolidated Statements of Operations for the twelve and twenty-four weeks ended
June 10, 2000 and June 12, 1999 and the  Condensed  Consolidated  Statements  of
Cash Flows for the  twenty-four  weeks  ended June 10,  2000 and June 12,  1999.
These Condensed  Consolidated Financial Statements are the responsibility of The
Pepsi Bottling Group, Inc.'s management.

We conducted our review in accordance with standards established by the American
Institute  of  Certified  Public  Accountants.  A review  of  interim  financial
information  consists  principally of applying  analytical  review procedures to
financial  data and making  inquiries of persons  responsible  for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the  expression  of an opinion  regarding the  financial  statements  taken as a
whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material  modifications that should
be made to the Condensed Consolidated Financial Statements referred to above for
them to be in conformity with generally accepted accounting principles.

We have  previously  audited,  in accordance  with generally  accepted  auditing
standards,  the Consolidated Balance Sheets of The Pepsi Bottling Group, Inc. as
of December 25, 1999,  and the related  Consolidated  Statements of  Operations,
Cash Flows and Changes in  Shareholders'  Equity for the  fifty-two  week period
then ended not  presented  herein;  and in our report dated January 25, 2000, we
expressed an unqualified opinion on those consolidated financial statements.  In
our  opinion,   the  information  set  forth  in  the   accompanying   Condensed
Consolidated Balance Sheet as of December 25, 1999, is fairly presented,  in all
material respects,  in relation to the consolidated  balance sheet from which it
has been derived.


/s/ KPMG LLP



New York, New York
July 13, 2000



                                      -15-





PART II - OTHER INFORMATION AND SIGNATAURES


Item 6.           Exhibits and Reports on Form 8-K
-------           --------------------------------
                  (a)  Exhibits

                        See Index to Exhibits on page 17.



                                      -16-




     Pursuant to the  requirement  of the  Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned.




                                                  THE PEPSI BOTTLING GROUP, INC.
                                                  ------------------------------
                                                                    (Registrant)






Date:      July 24, 2000                                       Peter A. Bridgman
-----      -------------                                       -----------------
                                                       Senior Vice President and
                                                                      Controller






Date:      July 24, 2000                                          John T. Cahill
-----      -------------                                          --------------
                                                    Executive Vice President and
                                                         Chief Financial Officer




                                      -17-




                               INDEX TO EXHIBITS
                                   ITEM 6 (a)
                                   ----------



EXHIBITS
--------

Exhibit 11                  Computation of Basic and Diluted Earnings Per Share

Exhibit 27.1                Financial Data Schedule 24-weeks ended June 10, 2000




                                      -18-