PepsiCo posted first-quarter profit that beat analysts’ estimates after strong sales of snacks in North America took the sting out of weaker results abroad.
Earnings were 89 cents a share, excluding some items, the Purchase, New York-based company said in a statement. Analysts estimated 81 cents, according to data compiled by Bloomberg. Sales fell 2.9 per cent to $11.9 billion, matching analysts’ average projection.
With the strong dollar hurting sales abroad, PepsiCo’s Frito-Lay division bolstered the company’s results in the quarter. Sales at the unit - which makes Doritos, Cheetos and Lay’s chips - rose 3 per cent to $3.42 billion, helped by a 2.5 per cent increase in average pricing. Chief Financial Officer Hugh Johnston said Monday that he expects PepsiCo’s domestic business to continue balancing out the weakness in emerging markets with “struggling” economies.
“The American consumer is still doing well and still benefiting from lower gas prices,” Johnston said in an interview. “I think the US business can continue to perform quite strongly.”
Net revenue from most of PepsiCo’s international units declined, driven by the dollar’s strength.
Europe and Sub-Saharan Africa sales fell 9.2 per cent to $1.36 billion. Asia, Middle East and North Africa sales rose 1.3 percent to $1.07 billion. Latin America sales dropped 26 per cent to $1.04 billion.
News by Bloomberg, edited by Hospitality Ireland