US: PepsiCo hails international markets for strong Q2

PepsiCo has posted a strong set of figures for its second quarter.

Net income for the 12 weeks to 16 June came in 13% up on the corresponding quarter a year earlier, reaching US$1.56bn, the company said today (24 July). Sales for the quarter were up 10% to $9.6bn.

PepsiCo credited the profit increase to double-digit revenue from its group International operations.

"All of our lines of business performed at or above our expectations, enabling us to generate strong division profit growth while lapping last year's best quarter," said PepsiCo chairman and CEO Indra Nooyi.

Internationally, beverage volume grew by 8%, led by double-digit growth in Pakistan, Russia, the Middle East, the UK and China, partially offset by declines in Mexico and Thailand. In total, CSDs grew at a high-single-digit rate, posting growth in each of the division's four largest trademarks - Pepsi, 7-Up, Mirinda and Mountain Dew. Non-carbonated beverages grew at a double-digit rate, with solid performance across the non-carbonated portfolio.

While profits at PepsiCo Beverages North America were up 4%, volumes at the unit were flat, down by less than 1%, with CSD volumes slipping by 4%. Non-CSDs, however, recorded a 3% lift, led by Lipton RTD teas, which leapt by 30% in volume terms.

The company subsequently raised its full-year earnings per share forecast to at least $3.35 from its earlier estimate of $3.30. "Our strong performance in the first half demonstrates the health of the business and supports our balance-of-year outlook," Nooyi noted.