Consumers continue to snack away during the Covid-19 pandemic, boosting
profit and its outlook.
Pepsi (ticker: PEP) said Thursday it earned an adjusted $1.66 a share on revenue that climbed 5.3% to $18.09 billion. Analysts were looking for EPS of $1.49 on revenue of $17.23 billion. Organic revenue grew 4.2% in the quarter.
In North America, beverage sales rose 6%, to $5.96 billion, while the company’s Frito-Lay division notched a 7% rise in sales, to $4.4 billion. Quaker Foods sales were up 6%.
Latin America was the only weak spot geographically, with sales falling 13%. In Europe, revenue increased 3%, while sales jumped 15% in the Asia-Pacific region and soared 31% the region defined as Africa, Middle East and South Asia.
For the full year, the company is forecasting EPS of $5.50, ahead of the $5.37 consensus estimate.
Pepsi shares were up 0.2% to $138.89 in early trading on Thursday, while the
Dow Jones Industrial Average
Growth in Pepsi’s core North American beverage business came after it recorded a 6.6% sales decline in the previous quarter. Even more encouraging was a return to organic sales growth—a key metric for consumer staples companies—from a slight dip in the second quarter.
In a post-earnings interview, Chief Financial Officer Hugh Johnson said the company continued to see the benefit of consumers eating more at home, a trend that has helped many packaged-food companies during the pandemic.
Pepsi shares are up a meager 1.4% for the year, although that is a much better showing than peer
(KO), which has fallen nearly 11%. Coke gets more of its business from consumers buying its products away from the home.
Write to Teresa Rivas at [email protected]