PepsiCo has said that its fourth quarter revenue rose by 8.8% to $22.46 billion, topping Wall Street expectations, as people munched Tostitos and Cheetos and gulped down Gatorade while stuck at home during coronavirus lockdowns.
PepsiCo Inc has predicted revenue growth in 2021, saying that it expects pre-pandemic lifestyles to resume as economies reopen and COVID-19 vaccines are rolled out.
The company has navigated the health crisis better than rival Coca-Cola as it relies more on grocery and retail channels from which consumers stockpiled snacks and beverages.
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The increase in demand last year led to the company to launching a direct-to-consumer website last year that offers special flavours and specialised bundles of its top selling products.
"We have figured how to do well in this environment," chief financial officer Hugh Johnston told Reuters, adding that most of the growth came from no-sugar, low-calorie and healthy options.
Still, revenue from the foodservice channel, which includes restaurants and vending machines, fell at a double-digit rate.
Chief executive Ramon Laguarta said that he expects consumers to return to certain pre-pandemic behaviours by the second half of 2021, but some changes such as increased online shopping and more remote work arrangements will likely be sustained.
The company expects a mid-single digit rise in annual organic revenue and a high-single digit increase in adjusted earnings.
"PepsiCo's success has largely been driven by its portfolio strategy and focus on at-home consumption, which is helping the company outperform others in the category, especially in beverage," Kristen Groh, a managing partner at Publicis Sapient, said.
Organic revenue for Frito-Lay North America rose by 5%, while those at the North American beverage unit rose by 5.5%.
Excluding items, it earned $1.47 per share, a cent above expectations, according Refinitiv IBES data.
PepsiCo's shares gained nearly 9% last year to outperform Coca-Cola's 1% rise.