US: PepsiCo sees Q1 profits increase as beverages go flat
- Q1 group net profits up 13% to US$1.21bn
- Total net sales in three months to end of March flat at $12.6bn
- Operating profits up 9% to $1.8bn
- Beverage volumes flat
PepsiCo's North American CSDs saw volumes fall by 1%
PepsiCo has posted a jump in first-quarter group profits, despite flat global beverage volumes and continuing CSD declines in North America.
Net profits in the three months to the end of March were up 13% to US$1.21bn, PepsiCo said today (17 April). Net sales in the quarter were flat at $12.6bn, while operating profits increased by 9% to $1.8bn.
Overall beverage volumes were stable, however, as carbonated volumes in North America fell by 1%. Non-carbonates in the region increased by 2% and there was a 3% volumes increase for overall beverages in Europe.
While the performance of the Asia, Middle East & Africa region was not broken down, its net sales on a reported basis fell by 5% in Q1, due in part to the negative impact of the bottling operations re-franchise in Vietnam in late-2012.
Chairman & CEO Indra Nooyi pronounced herself pleased with the group's performance, "despite ongoing macroeconomic volatility, political instability and other challenging marketplace conditions in a number of our key markets".
“We remain confident in achieving our financial goals for the full year," she added, before reiterating the group's desire to remain as one entity, despite recent shareholder pressure to split its food and beverage operations.
"(We) believe that we have the right strategies in place to create long-term value for our shareholders,” she concluded.
Looking forward, PepsiCo reiterated its previous guidance of a 7% lift in core, constant-currency earnings per share for 2014. Organic sales in the full year are expected to grow in the mid single-digit range.
The group's share price rose slightly this morning following the release of the numbers. Current trading is up by 1% at $84.77.
To read the company's official results announcement, click here.
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