US: PepsiCo Raises FY Forecast After Strong Q3 Results

PepsiCo has raised its profit forecast for the full year after reporting better-than-expected profit and revenue figures for its fiscal third quarter.

For the three months to 3 September, net profit was up to $1.99bn from $533m last year, when it was hurt by a $1.36bn charge related to its Venezuelan operations. Revenue was down 1.9% to $16.03bn, but was up 4.2% on an organic basis, coming in above expectations. Overall snack and beverage volumes rose 3% and 2%, respectively.

PepsiCo said results in North America were boosted by increased consumer demand for ‘healthier’ products, while its North America beverages unit saw revenues grow by 3%.  The group also reported improvements in key markets such as China, India, and Russia, while it noted that its performance in Western Europe “is not getting worse”.  Profits were helped by its continuing cost-cutting programme.

CEO Indra Nooyi said the group is “cautiously optimistic” about developing and emerging markets after seeing recent improvement. She added: “Whether they last at this point we don’t know, but they are looking pretty good”.

The group now expects its full-year adjusted net profit to grow by 10% to $4.78 a share, up from the 9% increase it had previously forecast.