(New York) The PepsiCo group revised its earnings outlook for the full year slightly upwards on Tuesday after a third quarter that exceeded market expectations.
The American giant, which markets Pepsi soft drinks, but also Doritos chips, Lipton iced teas and Quaker Oats cereals, earned $23.45 billion in turnover in the third quarter, compared to $21.97 billion. one year earlier.
“We are delighted with our performance at a time when our businesses and employees have demonstrated incredible agility and resilience across geographies and across product categories in a dynamic and evolving environment,” noted Ramon Laguarta, boss of PepsiCo, quoted in a press release.
Growth in international activity slowed, with 12% organic growth, compared to 16% a year earlier. PepsiCo explains that it has gained market share in several countries and has increased its production capacity.
The group generates 40% of its activity internationally.
In the US, organic growth was lower and the group reported advertising and marketing spending up more than 10%. Its Frito-Lay (chip) branch also saw its rate of growth slow down (7%, compared to 20% a year earlier), as did that of beverages (6%, compared to 13% a year earlier).
The group’s net profit stood at $3.10 billion, compared to $2.70 billion a year earlier. Reported per share – a benchmark for the markets – it reached US$2.24, after US$1.95 a year earlier.
The Factset analyst consensus was for revenue of $23.41 billion and earnings per share of US$2.24.
“Although volumes were down, Pepsi more than compensated with higher prices,” commented Neil Sanders, director of GlobalData.
“Consumers remain under pressure and although Pepsi products remain a favorite for many, many have switched to cheaper, other brands, including store brands, to try to cope to inflation,” he noted.
Building on these results, the group increased its forecast for 2023 excluding exceptional items for earnings per share which should increase by 13% (12% previously forecast) and maintained its outlook for organic growth in turnover of 10%.
It plans to pay a total of about $7.7 billion to its shareholders in the form of dividends and share buybacks.
He also lifted the veil for the first time on 2024, whose activity and earnings per share on a comparable basis should progress “at the top of the range of long-term targets” of 4% to 6% for the first and close to 10% for the second.
On Tuesday, on the NASDAQ floor, PepsiCo shares gained 1.9%, to US$164.40.
