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

(Mark One)
X   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
--- ACT OF 1934

For the quarterly period ended   March 22, 2003 (12-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
                                      ---      ---
Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act). Yes X  No
                                               ---   ---

Number of shares of Common Stock outstanding as of April 19, 2003:
274,178,773

<PAGE>



                         The Pepsi Bottling Group, Inc.
                         ------------------------------
                                      Index

                                                                       Page No.
                                                                       --------
Part I     Financial Information

  Item 1.  Financial Statements

           Condensed Consolidated Statements of Operations -
                12-weeks ended March 22, 2003 and March 23, 2002              2

           Condensed Consolidated Statements of Cash Flows -
                12-weeks ended March 22, 2003 and March 23, 2002              3

           Condensed Consolidated Balance Sheets -
                March 22, 2003 and December 28, 2002                          4

           Notes to Condensed Consolidated Financial Statements            5-11

           Independent Accountants' Review Report                            12

  Item 2.  Management's Financial Review                                  13-15

  Item 3.  Quantitative and Qualitative Disclosures About Market Risk        16

  Item 4.  Controls and Procedures                                           16

Part II    Other Information                                              17-22

<PAGE>



                         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
                                                                                    --------------
                                                                                 March           March
                                                                                22, 2003       23, 2002
                                                                                --------       --------
<S>                                                                              <C>            <C>
  Net revenues.................................................................. $1,874         $1,772
  Cost of sales.................................................................    927            942
                                                                                  -----          -----

  Gross profit.................................................................     947            830
  Selling, delivery and administrative expenses................................     827            695
                                                                                  -----          -----

  Operating income.............................................................     120            135
  Interest expense, net.........................................................     53             45
  Other non-operating expenses, net...........................................        3              -
  Minority interest............................................................       5              8
                                                                                  -----          -----

  Income before income taxes...................................................      59             82
  Income tax expense...........................................................      20             28
                                                                                  -----          -----

  Income before cumulative effect of change in accounting principle............      39             54
  Cumulative effect of change in accounting principle, net of tax and
     minority interest..........................................................      6              -
                                                                                  -----          -----

  Net income....................................................................  $  33         $   54
                                                                                  =====          =====

  Basic  earnings  per  share  before  cumulative  effect  of  change in
     accounting principle......................................................   $0.14         $ 0.19
  Cumulative effect of change in accounting principle..........................   (0.02)             -
                                                                                  -----          -----
  Basic earnings per share....................................................    $0.12         $ 0.19
                                                                                  =====          =====

  Weighted-average shares outstanding..........................................     279            280

  Diluted  earnings  per  share  before  cumulative  effect of change in
     accounting principle......................................................   $0.14         $ 0.19
  Cumulative effect of change in accounting principle..........................   (0.02)             -
                                                                                  -----          -----
  Diluted earnings per share...................................................   $0.12         $ 0.19
                                                                                  =====          =====

  Weighted-average shares outstanding...........................................    287            291

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



                                       2
<PAGE>





                         The Pepsi Bottling Group, Inc.
                 Condensed Consolidated Statements of Cash Flows
                             in millions, unaudited
<TABLE>
<CAPTION>


                                                                                     12-Weeks Ended
                                                                                     --------------
                                                                                  March          March
                                                                                22, 2003       23, 2002
                                                                                --------       --------
<S>                                                                                <C>             <C>
Cash Flows - Operations
 Net income..................................................................... $   33         $   54
 Adjustments to reconcile net income to net cash provided by operations:
   Depreciation.................................................................    117             91
   Amortization.................................................................      2              2
   Deferred income taxes.......................................................       4             11
   Cumulative effect of change in accounting principle.........................       6              -
   Other non-cash charges and credits, net.....................................      64             56
   Changes in operating working capital, excluding effects of acquisitions:
     Accounts receivable, net..................................................      51            (21)
     Inventories, net..........................................................     (24)            (9)
     Prepaid expenses and other current assets.................................     (37)            (3)
     Accounts payable and other current liabilities............................    (183)           (87)
     Income taxes payable.......................................................     37              -
                                                                                  -----          -----
   Net change in operating working capital .....................................   (156)          (120)
                                                                                  -----          -----
   Other, net.................................................................       (3)            (6)
                                                                                  -----          -----

Net Cash Provided by Operations.................................................     67             88
                                                                                  -----          -----

Cash Flows - Investments
 Capital expenditures..........................................................    (112)          (110)
 Acquisitions of bottlers......................................................     (82)           (24)
 Sale of property, plant and equipment.........................................       1              1
                                                                                  -----          -----

Net Cash Used for Investments...................................................   (193)          (133)
                                                                                  -----          -----

Cash Flows - Financing
 Short-term borrowings - three months or less...................................    120             15
 Dividends paid.................................................................     (3)            (3)
 Proceeds from exercise of stock options.........................................     7              3
 Purchases of treasury stock....................................................   (105)           (34)
                                                                                  -----          -----

Net Cash Provided by (Used for) Financing.......................................     19            (19)
                                                                                  -----          -----

Effect of Exchange Rate Changes on Cash and Cash Equivalents...................      (1)             -
                                                                                  -----          -----
Net Decrease in Cash and Cash Equivalents.......................................   (108)           (64)
Cash and Cash Equivalents - Beginning of Period................................     222            277
                                                                                  -----          -----
Cash and Cash Equivalents - End of Period....................................... $  114         $  213
                                                                                  =====          =====

Supplemental Cash Flow Information
Net third-party interest paid..................................................  $   76         $   95
                                                                                  =====          =====
Net income taxes (received) / paid.............................................. $  (19)        $   16
                                                                                  =====          =====
</TABLE>

     See accompanying notes to Condensed Consolidated Financial Statements.


                                       3
<PAGE>




                         The Pepsi Bottling Group, Inc.
                      Condensed Consolidated Balance Sheets
                      in millions, except per share amounts
<TABLE>
<CAPTION>

                                                                               (Unaudited)
                                                                                   March        December
                                                                                 22, 2003       28, 2002
                                                                                 --------       --------
<S>                                                                                <C>            <C>
  Assets
  Current Assets
    Cash and cash equivalents..................................................  $  114        $   222
    Accounts receivable, less allowance of $72 at
         March 22, 2003 and $67 at December 28, 2002...........................     882            922
    Inventories.................................................................    397            378
    Prepaid expenses and other current assets..................................     207            215
                                                                                  -----         ------
            Total Current Assets...............................................   1,600          1,737

  Property, plant and equipment, net...........................................   3,300          3,308
  Intangible assets, net......................................................    4,727          4,687
  Investment in debt defeasance trust..........................................     171            170
  Other assets.................................................................     120            125
                                                                                  -----         ------
            Total Assets.......................................................  $9,918        $10,027
                                                                                  =====         ======

  Liabilities and Shareholders' Equity
  Current Liabilities
    Accounts payable and other current liabilities.............................  $  997        $ 1,179
    Short-term borrowings......................................................     170             51
    Current maturities of long-term debt.......................................   1,016             18
                                                                                  -----         ------
            Total Current Liabilities..........................................   2,183          1,248

  Long-term debt...............................................................   3,519          4,523
  Other liabilities...........................................................      847            819
  Deferred income taxes........................................................   1,274          1,265
  Minority interest............................................................     352            348
                                                                                  -----         ------
            Total Liabilities..................................................   8,175          8,203

  Shareholders' Equity
     Common stock, par value $0.01 per share:
         authorized 900 shares, issued 310 shares..............................       3              3
     Additional paid-in capital................................................   1,755          1,750
     Retained earnings.........................................................   1,096          1,066
     Accumulated other comprehensive loss......................................    (485)          (468)
     Deferred compensation.....................................................      (5)             -
     Treasury stock: 34 shares and 30 shares at March 22, 2003 and December 28,
        2002, respectively, at cost............................................    (621)          (527)
                                                                                  -----         ------
            Total Shareholders' Equity.........................................   1,743          1,824
                                                                                  -----         ------
            Total Liabilities and Shareholders' Equity.......................    $9,918        $10,027
                                                                                  =====         ======
</TABLE>

     See accompanying notes to Condensed Consolidated Financial Statements.



                                       4
<PAGE>




Notes to Condensed Consolidated Financial Statements
Tabular dollars in millions
--------------------------------------------------------------------------------

Note 1 - Basis of Presentation
     The Pepsi  Bottling  Group,  Inc.  ("PBG" or "the  Company") is the world's
largest manufacturer,  seller and distributor of Pepsi-Cola beverages consisting
of bottling  operations  located in the United States,  Mexico,  Canada,  Spain,
Greece,  Russia  and  Turkey.  References  to  PBG  throughout  these  Condensed
Consolidated  Financial Statements are made using the first-person  notations of
"we", "our" and "us."

     As of March 22, 2003,  PepsiCo Inc.'s  ("PepsiCo")  ownership  consisted of
38.4% of our outstanding common stock and 100% of our outstanding Class B common
stock,  together  representing  43.5% of the voting  power of all classes of our
voting  stock.  PepsiCo also owns  approximately  6.8% of the equity of Bottling
Group, LLC, our principal operating subsidiary.

     The accompanying Condensed Consolidated Balance Sheet at March 22, 2003 and
the  Condensed  Consolidated  Statements  of  Operations  and Cash Flows for the
12-weeks ended March 22, 2003 and March 23, 2002 have not been audited, but have
been prepared in conformity with accounting principles generally accepted in the
United States 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 fiscal year ended December 28, 2002 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.

     Beginning in 2003, Russia is no longer considered highly inflationary,  and
as a result, changed its functional currency from the U.S. dollar to the Russian
ruble. There was no material impact on our consolidated  financial statements as
a result of Russia's change in functional currency in 2003.

     Our U.S. and Canadian  operations  report using a fiscal year that consists
of 52 weeks, ending on the last Saturday in December.  Every five or six years a
53rd week is added. Our remaining  countries report using a calendar year basis.
For the first quarter,  our U.S. and Canadian  operating  results consisted of a
twelve-week  period,  while our operating  results for our  remaining  countries
consisted of the months of January and February.

     Certain reclassifications were made in our Condensed Consolidated Financial
Statements to 2002 amounts to conform to the 2003 presentation.

Note 2 - Seasonality of Business
     The results for the first  quarter 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 and interest, which are not
significantly impacted by business seasonality.

Note 3 - Inventories
                                                          March       December
                                                        22, 2003      28, 2002
                                                        --------      --------
Raw materials and supplies...........................     $ 153         $ 162
Finished goods.......................................       244           216
                                                           ----          ----
                                                          $ 397         $ 378
                                                           ====          ====


                                       5
<PAGE>




Note 4 - Property, plant and equipment, net
                                                          March        December
                                                         22, 2003      28, 2002
                                                         --------      --------
Land....................................................  $   228      $   228
Buildings and improvements..............................    1,128        1,126
Manufacturing and distribution equipment................    2,817        2,768
Marketing equipment.....................................    2,036        2,008
Other...................................................      154          154
                                                           ------       ------
                                                            6,363        6,284
Accumulated depreciation................................   (3,063)      (2,976)
                                                           ------       ------
                                                          $ 3,300      $ 3,308
                                                           ======       =======

Note 5 - Intangible assets, net
                                                          March        December
                                                         22, 2003      28, 2002
                                                         --------      --------
Intangibles subject to amortization:
Gross carrying amount:
Franchise rights........................................  $    22      $    20
Other identifiable intangibles..........................       25           24
                                                           ------       ------
                                                               47           44
                                                           ------       ------
Accumulated amortization:
Franchise rights........................................       (6)          (6)
Other identifiable intangibles..........................      (11)          (9)
                                                           ------       ------
                                                              (17)         (15)
                                                           ------       ------
Intangibles subject to amortization, net................       30           29
                                                           ------       ------

Intangibles not subject to amortization:
Carrying amount:
Franchise rights........................................    3,441        3,424
Goodwill................................................    1,214        1,192
Other identifiable intangibles..........................       42           42
                                                           ------       ------
Intangibles not subject to amortization.................    4,697        4,658
                                                           ------       ------
Total intangible assets, net............................  $ 4,727      $ 4,687
                                                           ======       ======

     Total  intangible  assets  increased  by $40 million due to purchase  price
allocations  relating to our recent  acquisitions  of $68  million,  offset by a
negative  impact  from  currency  translation  adjustments  of $26  million  and
amortization of intangible assets of $2 million.

     For intangible  assets subject to amortization,  we calculate  amortization
expense on a straight-line  basis over the period we expect to receive  economic
benefit.  Total  amortization  expense was $2 million for the twelve-weeks ended
March 22, 2003 and March 23, 2002. The weighted-average  amortization period for
each category of intangible  assets and their estimated  aggregate  amortization
expense expected to be recognized over the next five years are as follows:

<TABLE>
<CAPTION>

                                     Weighted-Average         Estimated Aggregate Amortization Expense to be Incurred
                                    ------------------        -------------------------------------------------------
                                    Amortization Period
                                    -------------------

                                                           Balance of                Fiscal Year Ending
                                                           ----------                ------------------
<S>                                                           <C>           <C>        <C>          <C>          <C>
                                                              2003          2004       2005         2006         2007
                                                              ----          ----       ----         ----         ----
Franchise rights......................   5  years              $3            $4         $4           $2           $1
Other identifiable intangibles........   7  years              $3            $4         $3           $2           $1
</TABLE>


                                       6
<PAGE>




Note 6 - Acquisitions
     During 2003 we acquired the operations and exclusive  right to manufacture,
sell and distribute  Pepsi-Cola  beverages from two PepsiCo franchise  bottlers.
The  following  acquisitions  occurred  for an aggregate  purchase  price of $77
million in cash and liabilities of $7 million:

o   Pepsi-Cola Buffalo Bottling Corp. of Buffalo, New York in February in 2003.
o   Cassidy's Beverage Limited of New Brunswick, Canada in February in 2003.

     As a result of these  acquisitions,  we have  assigned  $68  million of the
purchase  price to  intangible  assets,  of which $14  million  was  assigned to
goodwill and $54 million to franchise rights.  The goodwill and franchise rights
are not  subject to  amortization.  As part of our  purchase  of the  Pepsi-Cola
Buffalo  Bottling  Corp., we may be required to pay to the prior owners up to $5
million over the next three years in accordance with the purchase agreement. The
final  allocations  of the  purchase  price  for  these  acquisitions  are still
preliminary  and will be determined  based on the fair value of assets  acquired
and liabilities assumed as of the dates of acquisition.

     These  acquisitions were made to enable us to provide better service to our
large retail  customers.  We expect these  acquisitions  to reduce costs through
economies of scale.

     In addition,  the  allocation of the purchase  price for certain prior year
acquisitions,  including our acquisition of Pepsi-Gemex, S.A. de. C.V of Mexico,
is still  preliminary,  pending final  valuations on certain  assets.  The final
allocations of the purchase price will be determined  based on the fair value of
assets acquired and liabilities assumed as of the dates of acquisition.

     In the first quarter of 2003, we paid  approximately  $3 million to PepsiCo
for  distribution  rights  relating  to the  SoBe  brand  in  certain  PBG-owned
territories in the United States, which are being amortized over their estimated
useful life of five years. In addition, we paid $2 million for the final working
capital settlements relating to acquisitions made in the prior year.

Note 7 - Treasury Stock
     In the first 12 weeks of 2003,  we  repurchased  approximately  4.8 million
shares for $105  million and  approximately  1.5 million  shares for $34 million
over the same  period in 2002.  Since  the  inception  of our  share  repurchase
program in  October  1999,  45.2  million  shares of PBG common  stock have been
repurchased of the total 50 million shares authorized to be repurchased.


                                       7
<PAGE>




Note 8 - Geographic Data
     We operate in one industry, carbonated soft drinks and other ready-to-drink
beverages. We conduct business in all or a portion of the United States, Mexico,
Canada, Spain, Russia, Greece and Turkey.

                                                             12-Weeks Ended
                                                             ---------------
     Net Revenues                                         March         March
                                                         22, 2003      23, 2002
                                                         --------      --------
     U.S............................................     $ 1,496       $ 1,580
     Mexico.........................................         157             -
     Other countries................................         221           192
                                                          ------        ------
                                                         $ 1,874       $ 1,772
                                                          ======        ======

     Long-Lived Assets                                    March        December
                                                         22, 2003      28, 2002
                                                         --------      --------
     U.S............................................     $ 5,631       $ 5,577
     Mexico.........................................       1,509         1,586
     Other countries................................       1,178         1,127
                                                          ------        ------
                                                         $ 8,318       $ 8,290
                                                          ======        ======

Note 9 - Stock-Based Compensation
     During 2002,  the Financial  Accounting  Standards  Board  ("FASB")  issued
Statement of Financial  Accounting  Standard  ("SFAS") No. 148  "Accounting  for
Stock-Based Compensation--Transition and Disclosure," which provides alternative
methods of  accounting  for  stock-based  compensation  and amends  SFAS No. 123
"Accounting for Stock-Based  Compensation." We measure stock-based  compensation
expense  using  the  intrinsic   value  method  in  accordance  with  Accounting
Principles  Board  ("APB")  Opinion  No.  25,  "Accounting  for Stock  Issued to
Employees," and its related interpretations.  Accordingly,  compensation expense
for stock option grants to our employees is measured as the excess of the quoted
market price of common stock at the grant date over the amount the employee must
pay for the  stock.  Our policy is to grant  stock  options at fair value on the
date of grant.  As allowed by SFAS No. 148, we have elected to continue to apply
the intrinsic value-based method of accounting described above, and have adopted
the  disclosure  requirements  of SFAS No. 123. If we had measured  compensation
cost for the stock awards  granted to our  employees  under the fair value based
method prescribed by SFAS No. 123, net income would have been changed to the pro
forma amounts set forth below:

<TABLE>
<CAPTION>

                                                                                   12-Weeks Ended
                                                                                   --------------
                                                                                  March       March
                                                                                 22, 2003    23, 2002
                                                                                 --------    --------
<S>                                                                                  <C>         <C>
Net income:
As reported..................................................................       $  33       $  54
Add:  Total stock-based employee compensation expense
      included in reported net income, net of taxes and
      minority interest.....................................................            1           -

Less: Total stock-based employee compensation expense determined
      under fair value based method for all awards, net of taxes
      and minority interest.................................................          (10)        (13)
                                                                                      ----        ----
Pro forma...................................................................        $  24       $  41
                                                                                      ====        ====
Earnings per share:
Basic - as reported.........................................................        $0.12       $0.19
Basic - pro forma...........................................................        $0.09       $0.15
</TABLE>


                                       8
<PAGE>

<TABLE>
<CAPTION>

                                                                                   12-Weeks Ended
                                                                                   --------------
                                                                                  March       March
                                                                                 22, 2003    23, 2002
                                                                                 --------    --------
<S>                                                                                <C>         <C>
Diluted - as reported.......................................................       $0.12       $0.19
Diluted - pro forma.........................................................       $0.08       $0.14
</TABLE>

     Pro forma compensation cost measured for stock options granted to employees
is  amortized  using a  straight-line  basis over the vesting  period,  which is
typically three years.

     In the first quarter of 2003, we issued  restricted stock awards to certain
key senior management,  which vest over periods ranging from three to five years
from the date of grant.  These  restricted  stock  awards are earned only if the
Company achieves certain  performance  targets over a three-year  period.  These
restricted  share awards are considered  variable awards pursuant to APB Opinion
25,  which  requires the related  compensation  expense to be  re-measured  each
period  until the  performance  targets  are met and the  amount  of the  awards
becomes  fixed.   When  the  restricted   stock  award  was  granted,   deferred
compensation  of  approximately  $6  million  was  recorded  as a  reduction  to
shareholders'  equity,  and will be amortized on a straight-line  basis over the
vesting periods.

Note 10 - New Accounting Standards
     In  January  2003,  the  Emerging  Issues  Task  Force  ("EITF")  reached a
consensus on Issue No. 02-16,  "Accounting by a Reseller for Cash  Consideration
Given  by a  Vendor  to  a  Customer  (Including  a  Reseller  of  the  Vendor's
Products),"  addressing the recognition and income statement  classification  of
various  cash  considerations  given by a vendor to a  customer.  The  consensus
requires that certain cash  considerations  received by a customer from a vendor
are  presumed  to be a  reduction  of the price of the  vendor's  products,  and
therefore  should  be  characterized  as a  reduction  of  cost  of  sales  when
recognized in the customer's income statement,  unless certain criteria are met.
EITF Issue No. 02-16 became effective  beginning in our fiscal year 2003. In the
prior year we classified  worldwide bottler incentives received from PepsiCo and
other brand owners as  adjustments  to net  revenues  and selling,  delivery and
administrative expenses depending on the objective of the program. In accordance
with EITF Issue No. 02-16,  we have classified  certain bottler  incentives as a
reduction  of cost of sales  beginning  in 2003.  We have  recorded a transition
adjustment of $6 million,  net of taxes and minority interest of $1 million, for
the cumulative  effect on prior years.  This  adjustment  reflects the amount of
bottler  incentives  that  can be  attributed  to our 2003  beginning  inventory
balances.  This  accounting  change did not have a material effect on our income
before cumulative  effect of change in accounting  principle in the first twelve
weeks of 2003 and is not expected to have a material  effect on such amounts for
the balance of fiscal 2003. Assuming that EITF Issue No. 02-16 had been in place
for all periods  presented,  the following pro forma adjustments would have been
made to our reported results for the twelve-weeks ended March 23, 2002:

                                                    As     EITF 02-16  Pro Forma
                                                 Reported  Adjustment   Results
                                                 --------  ----------   --------
Net revenues.................................... $1,772     $ (59)      $1,713
Cost of sales...................................    942       (95)         847
Selling, delivery and administrative expenses...    695        37          732
                                                  -----      ----        -----
Operating income................................ $  135     $  (1)      $  134
                                                  =====      ====        =====


                                       9
<PAGE>




     Assuming  EITF Issue No. 02-16 had been adopted for all periods  presented,
pro forma net income and earnings per share for the twelve-weeks ended March 22,
2003 and March 23, 2002, would have been as follows:

                                                           12-Weeks Ended
                                                           ---------------
                                                        March          March
                                                      22, 2003       23, 2002
                                                      --------       --------
     Net income:
       As reported..............................      $   33         $   54
       Pro forma................................          39             53

     Earnings per share:
       Basic - as reported......................      $ 0.12         $ 0.19
       Basic - pro forma........................      $ 0.14         $ 0.19

       Diluted - as reported....................        0.12           0.19
       Diluted - pro forma......................        0.14           0.18

     During 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with the Exit or Disposal  Activities."  SFAS No. 146 is  effective  for exit or
disposal activities initiated after December 31, 2002. We do not anticipate that
the  adoption  of SFAS No.  146 will have a  material  impact  on our  Condensed
Consolidated Financial Statements.

     In  November  2002,  the FASB  issued  Interpretation  No.  45 ("FIN  45"),
"Guarantor's  Accounting and Disclosure  Requirements for Guarantees,  Including
Indirect  Guarantees of Indebtedness of Others," which addresses the disclosures
to be made by a guarantor in its interim and annual  financial  statements about
its  obligations  under  guarantees.  FIN 45 also requires the  recognition of a
liability by a guarantor at the inception of certain guarantees that are entered
into or modified after December 31, 2002. We do not anticipate that the adoption
of FIN 45 will have a material  impact on our Condensed  Consolidated  Financial
Statements.

     In  January  2003,  the FASB  issued  Interpretation  No.  46  ("FIN  46"),
"Consolidation of Variable Interest Entities," which addresses  consolidation by
business  enterprises of variable interest entities that either: (1) do not have
sufficient  equity  investment  at risk to  permit  the  entity to  finance  its
activities without additional  subordinated financial support, or (2) the equity
investors lack an essential  characteristic of a controlling financial interest.
We do not anticipate  that the adoption of FIN 46 will have a material impact on
our Condensed Consolidated Financial Statements.

Note 11 - Comprehensive Income

                                                                 12-Weeks Ended
                                                                 --------------
                                                                March    March
                                                              22, 2003  23, 2002
                                                              --------  --------
Net income....................................................   $ 33     $ 54
Currency translation adjustment...............................    (24)       2
Cash flow hedge adjustment (a)................................      7        7
                                                                  ---      ---
Comprehensive income..........................................   $ 16     $ 63
                                                                  ===      ===
(a) Net of  minority  interest  and  taxes of $6 and
$5 for the  12-weeks  ended March 22, 2003 and March
23, 2002, respectively.


                                       10
<PAGE>




Note 12 - Contingencies
     We are subject to various  claims and  contingencies  related to  lawsuits,
taxes and  environmental  and other matters  arising out of the normal course of
business.  We believe  that the ultimate  liability  arising from such claims or
contingencies,  if any, in excess of amounts already recognized is not likely to
have a material adverse effect on our results of operations, financial condition
or liquidity.

     In the first  quarter  of 2003,  we  settled a lawsuit  with the New Jersey
State  Department  of Labor and with  current  and former  employees  concerning
overtime  wage  issues.  The amount of this  settlement  was  approximately  $28
million,  which  was  fully  provided  for in  our  litigation  reserves  in our
Consolidated Balance Sheets at December 28, 2002.



                                       11
<PAGE>



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

The Board of Directors and Shareholders
The Pepsi Bottling Group, Inc.:

We have reviewed the accompanying  condensed  consolidated  balance sheet of The
Pepsi  Bottling  Group,  Inc. as of March 22,  2003,  and the related  condensed
consolidated  statements of operations and cash flows for the twelve weeks ended
March 22,  2003 and March  23,  2002.  These  condensed  consolidated  financial
statements are the responsibility of the Company'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  procedures 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 accounting  principles  generally  accepted in the
United States of America.

We have  previously  audited,  in accordance with auditing  standards  generally
accepted in the United States of America,  the consolidated balance sheet of The
Pepsi Bottling Group, Inc. as of December 28, 2002, and the related consolidated
statements of operations,  changes in shareholders'  equity,  and cash flows for
the  fifty-two  week period then ended not presented  herein;  and in our report
dated  January  28,  2003,  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 28, 2002,
is fairly  stated,  in all material  respects,  in relation to the  consolidated
balance sheet from which it has been derived.


/s/ KPMG LLP

New York, New York
April 22, 2003



                                       12
<PAGE>




Item 2.
Management's Financial Review


OVERVIEW
---------
     The Pepsi Bottling Group, Inc.  (collectively  referred to as "PBG",  "we",
"our" and "us") is the world's largest  manufacturer,  seller and distributor of
Pepsi-Cola  beverages.  We have the  exclusive  right to  manufacture,  sell and
distribute  Pepsi-Cola  beverages  in all or a  portion  of the  United  States,
Mexico,  Canada,  Spain,  Greece,  Russia and Turkey.  In first quarter of 2003,
approximately 80% of our net revenues were generated in the United States, 8% of
our net  revenues  were  generated  in Mexico and the  remaining  12%  generated
outside the United States and Mexico.


ITEMS THAT AFFECT HISTORICAL OR FUTURE COMPARABILITY
----------------------------------------------------
Gemex Acquisition
-----------------
     In November  2002,  we acquired  all of the  outstanding  capital  stock of
Pepsi-Gemex,  S.A.  de. C.V. of Mexico  ("Gemex").  Our total  acquisition  cost
consisted   of  a  net  cash  payment  of  $871  million  and  assumed  debt  of
approximately  $305  million.  The  Gemex  acquisition  was  made to allow us to
increase our markets outside the United States. Gemex was the largest Pepsi-Cola
bottler  in  Mexico  and the  largest  bottler  outside  the  United  States  of
Pepsi-Cola soft drink products based on sales volume.  Gemex produced,  sold and
distributed a variety of soft drink products under the Pepsi-Cola,  Pepsi Light,
Pepsi Max, Pepsi Limon, Mirinda, 7 UP, Diet 7 UP, KAS, Mountain Dew, Power Punch
and  Manzanita  Sol   trademarks,   under   exclusive   franchise  and  bottling
arrangements  with  PepsiCo and certain  affiliates  of PepsiCo.  Gemex also had
rights to produce,  sell and  distribute in Mexico soft drink  products of other
companies and it produced,  sold and  distributed  purified and mineral water in
Mexico under the trademarks  Electropura  and Garci Crespo,  respectively.  As a
result of the  acquisition  of Gemex,  we own the  Electropura  and Garci Crespo
brands.

New Accounting Standards
------------------------

     See  Note  10 -  New  Accounting  Standards,  in  our  Notes  to  Condensed
Consolidated  Financial Statements,  for a detailed discussion of new accounting
standards that were adopted in 2003.

RESULTS OF OPERATIONS
---------------------
Volume

     Our  worldwide  reported  physical  case volume  increased 16% in the first
quarter  of  2003,  reflecting  a 20%  increase  in  volume  resulting  from our
acquisitions  and a 4% decrease in volume from our base business  (base business
reflects territories that have operating results in the current and prior year).
In the U.S.,  volume decreased by 4%,  reflecting a 5% decrease in base business
volumes offset by a 1% increase resulting from acquisitions. Volume decreases in
the U.S. reflect declines in both our take home and cold drink businesses.  U.S.
declines in trademark Pepsi were partially offset by strong growth from Aquafina
and Sierra Mist.  Outside the U.S., our volumes increased 125% reflecting a 124%
increase from new volume due to acquisitions in Mexico,  Turkey and Canada. Base
business  volume  outside the U.S.  increased 1% due to  double-digit  growth in
Russia,  which was  partially  offset by volume  declines in Spain and volume in
Canada that was essentially flat.



                                       13
<PAGE>



Net Revenues

     Reported net revenues were $1.9 billion for the first quarter in 2003, a 6%
increase over the prior year, which includes an 11% increase from  acquisitions.
In our base  business,  we had a 2%  increase  in net  revenue per case and a 1%
favorable impact from currency  translations,  partially offset by a 4% decrease
in volume and a more than 3% negative impact from the adoption of EITF Issue No.
02-16.  Worldwide  net revenue  per case  declined  by 9%,  reflecting  negative
country mix,  primarily from our  acquisition  territories in Mexico and Turkey,
and the impact of adopting EITF Issue No. 02-16.

     In the U.S.,  reported  net  revenues  decreased  5%,  which  includes a 1%
increase from  acquisitions.  In our base  business,  there was a 5% decrease in
volume and a 3% negative impact from the adoption of EITF Issue No. 02-16, which
was partially offset by rate increases of approximately 2%.

     Reported  net  revenues  outside the U.S.  grew  approximately  97%,  which
includes a 93% increase from acquisitions.  In our base business, there was a 9%
favorable  impact of currency  translations,  partially  offset by a 5% decrease
from the adoption of EITF Issue No. 02-16.  Approximately 82% of the increase in
net revenues outside the U.S. was attributable to our acquisition in Mexico.

     Worldwide  net  revenue  per  case  is  expected  to be  down  in  the  low
double-digits  in the second  quarter and down in the high single digits for the
full year.  The decline in our  worldwide net revenue per case will be driven by
our acquisition in Mexico in November of the prior year and the adoption of EITF
Issue No. 02-16.

Cost of Sales

     Cost of sales was $927 million in the first  quarter of 2003, a 2% decrease
over the prior year,  which  includes a 10% increase from  acquisitions.  In our
base  business,  there was a 10%  decrease  resulting  from the adoption of EITF
Issue No. 02-16 and a 4% decrease in volume,  partially  offset by a 1% negative
impact from currency translations and a 1% increase in cost of sales per case.

     In the U.S.,  cost of sales  decreased by 11%, which includes a 1% increase
from  acquisitions.  In our  base  business  there  was a 9%  decrease  from the
adoption of EITF Issue No. 02-16 and 5% decrease in volume,  which was partially
offset by more than 1% increase in cost of sales per case.  The increase in cost
of sales per case was driven by higher concentrate costs in the United States.

     Cost of sales outside the U.S. grew by 65%,  which  includes a 76% increase
from acquisitions.  In our base business, there was a 7% increase resulting from
the negative impact from currency  translations and a 2% increase in our cost of
sales per case,  partially offset by a 20% decrease  resulting from the adoption
of EITF Issue No.  02-16.  Approximately  62% of the  increase  in cost of sales
outside the U.S.  was  attributable  to our  acquisition  in Mexico in the prior
year.

Selling, Delivery and Administrative Expenses

     Selling,  delivery and administrative expenses grew $132 million, or 19% in
the  first  quarter  of 2003,  which  includes  a 14%  increase  resulting  from
acquisitions.  In our base business there was a 5% increase from the adoption of
EITF Issue No. 02-16 and a 1% negative impact from currency translations,  which
was  partially  offset by a 1% decline in selling,  delivery and  administrative
expenses  resulting from additional  accounts  receivable  reserves taken in the
prior year and current year productivity gains.

Operating Income

     Operating   income  was  $120  million  in  the  first   quarter  of  2003,
representing  a 10% decrease over first quarter of 2002.  This decline is driven
primarily by the negative impact from lower volume in the U.S., partially offset
by higher pricing.  Our acquisitions did not have a material impact on operating
income in the first quarter of 2003.

                                       14
<PAGE>



     We expect  reported  operating  income during the second quarter to grow in
the mid-single digits with growth coming predominately from Mexico. For the full
year,  reported  operating  income is expected to increase in the mid-teens with
Mexico contributing two-thirds of that growth.

Interest Expense, net

     Interest expense, net increased by $8 million largely due to the additional
interest  associated with the $1 billion 4 5/8% senior notes used to finance our
acquisition of Gemex in November 2002,  partially offset by the favorable impact
of the interest rate swaps on $1.3 billion of our fixed rate long-term debt.

Income Tax Expense

     PBG's estimated full year effective tax rate for 2003 is 34.3% and has been
applied to our first quarter 2003  results.  Our effective tax rate in the first
quarter of 2002 was 33.8%.  The slight  increase  in the  effective  tax rate is
primarily due to an increase in anticipated pre-tax income in jurisdictions with
higher tax rates.

Liquidity and Capital Resources
-------------------------------

Cash Flows

     Net cash  provided by  operations  decreased  by $21 million to $67 million
reflecting a decline in operating  income coupled with the increased use of cash
from working  capital,  principally  from the timing of  payments,  offset by an
increase in depreciation expense.

     Net cash used for  investments  increased  by $60  million to $193  million
reflecting higher acquisition spending.

     Net cash provided by financing increased by $38 million driven by increased
short term borrowings partially offset by higher share repurchases.

Current Maturities of Long Term Debt

     We intend to refinance  all or a portion of our $1 billion of 5 3/8% senior
notes upon their maturity in February 2004. We are currently in compliance  with
all debt covenants in our indenture agreements.

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  related  infrastructure  expenditures,
material changes in expected levels of bottler incentive  payments from PepsiCo,
material  changes in our  expected  interest  and currency  exchange  rates,  an
inability to achieve cost savings, an inability to achieve volume growth through
product and packaging initiatives,  competitive pressures that may cause channel
and product mix to shift from more  profitable cold drink channels and packages,
weather  conditions  in PBG's  markets,  political  conditions  in PBG's markets
outside the United States and Canada,  possible  recalls of PBG's  products,  an
inability to meet  projections  for  performance in newly acquired  territories,
unfavorable market performance on our pension plan assets,  unfavorable outcomes
from our U.S. Internal Revenue Service audits, and changes in our debt ratings.

                                       15
<PAGE>



Item 3.

Quantitative and Qualitative Disclosures About Market Risk
----------------------------------------------------------
     The  overall  risks to our  international  businesses  include  changes  in
foreign  governmental  policies,  and other political or economic  developments.
These developments may lead to new product pricing,  tax or other policies,  and
monetary fluctuations which may adversely impact our business. In addition,  our
results  of  operations  and the value of the  foreign  assets are  affected  by
fluctuations in foreign currency exchange rates.

     Foreign currency gains and losses reflect  transaction  gains and losses as
well as translation gains and losses arising from the  re-measurement  into U.S.
dollars  of the  net  monetary  assets  of  businesses  in  highly  inflationary
countries.   Beginning  in  2003,   Russia  is  no  longer   considered   highly
inflationary,  and changed its functional  currency from the U.S.  dollar to the
Russian ruble. The impact to our consolidated  financial  statements as a result
of Russia's change in functional currency in 2003 was not material.

     We acquired  Gemex in November 2002.  Approximately  8% of our net revenues
were derived from Mexico in the first quarter of 2003.  During the first quarter
of 2003, the Mexican peso declined by approximately  6%. Future movements in the
Mexican peso could have a material impact on our financial results.

Item 4.

Controls and Procedures
-----------------------
     Within  90 days  prior  to the  date of this  report,  PBG  carried  out an
evaluation,  under the supervision and with the participation of our management,
including the Chief Executive Officer and the Chief Financial Officer of PBG, of
the  effectiveness  of our disclosure  controls and  procedures  pursuant to the
Exchange  Act Rule  13a-14.  Based  upon that  evaluation,  the Chief  Executive
Officer and the Chief Financial  Officer  concluded,  subject to the limitations
set forth below,  that our  disclosure  controls and procedures are effective in
timely  alerting  them  to  material   information   relating  to  PBG  and  its
consolidated subsidiaries required to be included in PBG's periodic filings with
the SEC. In addition,  subject to the limitations set forth below, there were no
significant  changes in our  internal  controls or in other  factors  that could
significantly  affect these internal controls subsequent to the date of our most
recent evaluation.

Limitations on the Effectiveness of Controls.

     Our  management,  including  the  Chief  Executive  Officer  and the  Chief
Financial Officer,  does not expect that our disclosure controls or our internal
controls will prevent all error and all fraud. A control  system,  no matter how
well  conceived  and  operated,  can  provide  only  reasonable,  not  absolute,
assurance that the objectives of the control system are met. Further, the design
of a control  system must reflect the fact that there are resource  constraints,
and the benefits of controls must be considered relative to their costs. Because
of the inherent  limitations in all control  systems,  no evaluation of controls
can provide  absolute  assurance that all control issues within our company have
been  detected.  The design of any system of controls also is based in part upon
certain  assumptions about the likelihood of future events,  and there can be no
assurance  that any design will succeed in achieving  its stated goals under all
potential  future  conditions.   Because  of  the  inherent   limitations  in  a
cost-effective control system, misstatements due to error or fraud may occur and
may not be detected.



                                       16
<PAGE>



                           PART II - OTHER INFORMATION


Item 6.           Exhibits and Reports on Form 8-K
                  --------------------------------

ITEM 6 (a). EXHIBITS
--------------------

Exhibit 11                  Computation of Basic and Diluted Earnings Per Share

Exhibit 15                  Accountants' Acknowledgement

Exhibit 99.1                Certification by the Chief Executive Officer of
                            Periodic Financial Report pursuant to Section 906 of
                            the Sarbanes - Oxley Act of 2002

Exhibit 99.2                Certification by the Chief Financial Officer of
                            Periodic Financial Report pursuant to Section 906 of
                            the Sarbanes - Oxley Act of 2002

Exhibit 99.3                Bottling Group LLC condensed consolidated financial
                            statements and notes thereto for the first quarter
                            ended March 22, 2003





ITEM 6 (b). REPORTS ON FORM 8-K
-------------------------------

On January 27, 2003, the Company filed a current Form 8-K Report, announcing the
election of John T. Cahill as Chairman of the Company.


                                       17
<PAGE>



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:      May 5, 2003                           /s/ Andrea L. Forster
          ------------                           ----------------------
                                                  Andrea L. Forster
                                                  Vice President and Controller






Date:      May 5, 2003                           /s/ Alfred H. Drewes
          ------------                           ---------------------
                                                  Alfred H. Drewes
                                                  Senior Vice President and
                                                  Chief Financial Officer




                                       18
<PAGE>



Form 10-Q Certification

I, John T. Cahill, certify that:

1. I have  reviewed  this  quarterly  report on Form 10-Q of The Pepsi  Bottling
Group, Inc.;

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a) designed such disclosure controls and procedures to ensure that material
     information   relating  to  the  registrant,   including  its  consolidated
     subsidiaries,  is  made  known  to  us by  others  within  those  entities,
     particularly  during  the period in which  this  quarterly  report is being
     prepared;

     b) evaluated the effectiveness of the registrant's  disclosure controls and
     procedures  as of a date  within 90 days prior to the  filing  date of this
     quarterly report (the "Evaluation Date"); and

     c)  presented  in  this  quarterly   report  our   conclusions   about  the
     effectiveness  of the  disclosure  controls  and  procedures  based  on our
     evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):

     a) all  significant  deficiencies  in the design or  operation  of internal
     controls which could adversely affect the  registrant's  ability to record,
     process,  summarize and report  financial data and have  identified for the
     registrant's auditors any material weaknesses in internal controls; and

     b) any fraud,  whether or not material,  that involves  management or other
     employees  who  have  a  significant  role  in  the  registrant's  internal
     controls; and




                                       19
<PAGE>



6. The  registrant's  other  certifying  officers  and I have  indicated in this
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.





Date:      May 5, 2003                                /s/ John T. Cahill
           -----------                                ------------------
                                                      John T. Cahill
                                                      Chief Executive Officer

                                       20
<PAGE>



Form 10-Q Certification

I, Alfred H. Drewes, certify that:

1. I have  reviewed  this  quarterly  report on Form 10-Q of The Pepsi  Bottling
Group, Inc.;

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

     a) designed such disclosure controls and procedures to ensure that material
     information   relating  to  the  registrant,   including  its  consolidated
     subsidiaries,  is  made  known  to  us by  others  within  those  entities,
     particularly  during  the period in which  this  quarterly  report is being
     prepared;

     b) evaluated the effectiveness of the registrant's  disclosure controls and
     procedures  as of a date  within 90 days prior to the  filing  date of this
     quarterly report (the "Evaluation Date"); and

     c)  presented  in  this  quarterly   report  our   conclusions   about  the
     effectiveness  of the  disclosure  controls  and  procedures  based  on our
     evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):

     a) all  significant  deficiencies  in the design or  operation  of internal
     controls which could adversely affect the  registrant's  ability to record,
     process,  summarize and report  financial data and have  identified for the
     registrant's auditors any material weaknesses in internal controls; and

     b) any fraud,  whether or not material,  that involves  management or other
     employees  who  have  a  significant  role  in  the  registrant's  internal
     controls; and



                                       21
<PAGE>





6. The  registrant's  other  certifying  officers  and I have  indicated in this
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.





Date:      May 5, 2003                                /s/ Alfred H. Drewes
           -----------                                ---------------------
                                                      Alfred H. Drewes
                                                      Senior Vice President and
                                                      Chief Financial Officer


                                       22