Beverage and snack-food giant PepsiCo has reported a 1.7% organic revenue growth in its third quarter, which represents an increase of 2.3% for the year to date.
Reported operating profit increased by 6%, and core constant currency operating profit increased 4%, while net cash provided by operating activities stood at $3.8 billion.
“Overall, our businesses performed well in the third quarter in what continues to be a challenging environment,” said Indra Nooyi, chairman and CEO of PepsiCo.
“Each of our operating sectors delivered results in line with or ahead of our expectations, with the exception of North America Beverages, where revenues declined following two consecutive years of very strong third-quarter growth."
Quarterly Performance
In the third quarter of the year, almost all of PepsiCo's divisions experienced positive growth.
Frito-Lay North America, Quaker Foods North America, Latin America and Europe Sub-Saharan Africa were all positively impacted by productivity gains and prior-year incremental investments.
Meanwhile, the Asia, Middle East and North America division was positively impacted by lower advertising and marketing expenses, which were partially offset by higher raw material costs and unfavourable foreign exchange translation.
North American Beverages (NAB) was negatively impacted by operating cost inflation, however, this was substantially offset by productivity gains.
Outlook
PepsiCo says that it expects full-year organic revenue growth to approximate its year-to-date growth rate, with core earnings per share of $5.23.
"Despite the challenges in our NAB business, the PepsiCo portfolio overall generated revenue, operating profit and earnings per share growth," added Nooyi.
"Although we have moderated our full-year organic revenue growth outlook, we are now on track to exceed the full-year earnings per share target we set at the beginning of the year.”
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Sarah Harford. Click subscribe to sign up to ESM: The European Supermarket Magazine.
