PepsiCo Inc beat first quarter revenue estimates, but ditched its full-year forecast, citing uncertainty around the globe due to the novel coronavirus pandemic.
The company also said it still expected to pay $5.5 billion (€5.06 billion) in dividends and buy back shares worth $2 billion this fiscal year, signalling financial stability at a time when several blue-chip firms have suspended shareholder returns to shore up cash reserves.
Surge In Demand
While PepsiCo did not say how the virus was directly affecting its business, government lockdown orders around the world have triggered an unprecedented surge in demand for food and beverage products in recent weeks.
Analysts said Pepsi's more diversified snacks business, which includes Lay's and Doritos, have given it a leg up over rival Coca-Cola Co as consumers stockpile.
Last week, Coke warned of a hit to second-quarter sales also due to the closure of public venues and said volumes fell 25% globally since the beginning of April, largely stemming from the loss of sales other than at retail stores.
PepsiCo's net revenue rose 7.7% to $13.9 billion (€12.8 billion) in the quarter ended 21 March, beating analysts' estimates of $13.21 billion (€12.1 billion), as a massive advertising campaign during the Super Bowl helped boost sales of its sodas and snacks.
Net income attributable to the company fell to $1.34 billion (€1.23 billion), or 96 cents per share, from $1.41 billion (€1.3 billion), or $1 per share, a year earlier.
Excluding one-time items, Pepsico earned $1.07 per share, beating estimates of $1.03, according to Refinitiv IBES data.
The group had previously forecast full-year organic revenue growth of 4% and an increase in core constant currency earnings per share of 7%.