Pepsi Reports Better Than Expected Quarterly Results, Profits Up 4.1 Percent

October 12 00:00 2011

New York, October 12 (RainbowNewsLine.com) – Quarterly profit of PepsiCo (NYSE: PEP) showed better-than-expected results and pointed to fulfillment of the full-year target.

Cost-saving measures were adopted by the maker of Pepsi-Cola, Lays potato chips and Quaker oatmeal after they acquired the North American bottlers last year. They had also bought a Russian beverage company which will enable them to tackle higher commodity costs and weak consumer spending.

In pre-market trading Wednesday, the shares of PepsiCo went up 0.8 percent, or 50 cents. Its net income was $2.0 billion or $1.25 per share in the third quarter, up from $1.92 billion or $1.19 per share a year earlier. According to Thomson Reuters, the earnings were 41.31 per share excluding items, which was better than analysts’ average estimate by a penny.

Although analysts were expecting revenue of $ 17.18 billion, the actual earnings rose to $17.58 billion from $15.51 billion a year ago. The full-year outlook for the company envisages that 2011 earnings would grow at a high single-digit rate. However, the company said that the outlook “reflects uncertainty regarding macroeconomic and consumer trends for 2011 and anticipates high global commodity cost inflation and ongoing support of strategic initiatives in emerging markets and brand building activities.”

PepsiCo also expects about $2.5 billion in share buybacks this year. On the New York Stock Exchange its shares rose 50 cents to $61.45 in premarket trading from Tuesday’s close of $60.95.

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