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PepsiCo Inc.’s stock rose 1.8% in premarket trade Thursday, after the drinks and snacks giants topped estimates for the second quarter and raised its guidance.
The company posted net income of $2.748 billion, or $1.99 a share, for the quarter, up from $1.429 billion, or $1.03 a share, in the year-earlier period. Adjusted per-share earnings came to $2.09, ahead of the $1.96 FactSet consensus.
Revenue rose to $22.322 billion from $20.225 billion a year ago, also ahead of the $21.729 billion FactSet consensus.
“Moving forward, we will look to elevate our focus on productivity initiatives to further support investments in innovation, brand building, digitalization, and sustainability to win in the marketplace and fortify our businesses for the long-term,” Chief Executive Ramon Laguarta said in a statement.
Revenue at Frito-Lay North America rose 14%, while Quaker Foods North America was up 1% and PepsiCo beverages North America rose 10%.
Latin America revenues rose 18%, Europe revenue was up 13%, but Africa, the Middle East and South Asia revenue was down 8%. Revenue for the Asia Pacific, Australia, New Zealand and China was up 1%.
Some of PepsiCo’s more popular brands, including Lay’s, Doritos, Cheetos, and Ruffles, generated double-digit net revenue growth, along with smaller, emerging brands aimed at consumers seeking healthier choices, such as PopCorners, SunChips, Bare, and Off The Eaten Path.
At Frito-Lay, the company added choices with lightly salted options and smaller pack sizes for consumers seeking portion control. Overall, the company is diversifying packaging options and recently introduced Frito-Lay minis, which are bite-sized versions of Doritos, Cheetos and Sun Chips packaged in an easy-to-pour canister.
The company is also experimenting with taste, by adding bolder and spicier combinations of existing brands, extending its Flamin’ Hot flavor variety across Doritos, Cheetos, Funyuns, Fritos, and Chester’s.
At Quaker Foods, the company gained share in pancake mix, pancake syrup, grits, rice and pasta and lite snacks categories, and delivered double-digit net revenue growth in the lite snacks, grits, cookies, and pancake syrups and mixes categories.
PepsiCo Beverages continues to expand its array of zero-sugar offerings and update its ready-to-drink teas, sparkling and enhanced waters. In sports nutrition, it’s expanding to offer powders, supplements, gummies and equipment.
See also: What is aspartame, and is it bad for you? Here’s what health experts say.
The company
PEP,
is now expecting fiscal 2023 organic revenue growth of 10%, up from 8% previously. It expects its core constant currency EPS to rise 12%, up from prior guidance for a 9% rise. Core EPS is expected to come to $7.47, up from $7.27 previously, while FactSet is expecting it to come to $7.32.
The company is expecting to return about $7.7 billion to shareholders this year, a dividend between $6.7 billion of dividends and $1.0 billion of share buybacks.
The stock has gained 1.4% in the year through Wednesday’s close, while the S&P 500
SPX,
has gained 16%.
See also: Monster agrees to acquire rival Bang Energy out of bankruptcy for $362 million
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