PepsiCo earnings fall on restructuring costs

by Staff
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PURCHASE, N.Y. — Restructuring costs and a stronger dollar contributed to a 21% decline in income during the second quarter at PepsiCo, Inc.

For the quarter ended June 16, the company had income of $1,488 million, equal to 94c per share, which compared with income of $1,885 million, or $1.17 per share, during the same quarter of the previous year. Revenue for the quarter was $16,458 million, down 2% from $16,827 million during the same quarter of the previous year.

“PepsiCo is diligently executing the strategy we set forth at the start of the year, and we remain on track to achieve our full-year targets,” said Indra Nooyi, chairman and chief executive officer. “We were able to achieve significant pricing in the second quarter, reflecting the strength of our brand portfolio and the success of our packaging initiatives. Our disciplined approach to pricing and continued focus on brand investment drove 5% organic net revenue growth and allowed us to substantially offset approximately $350 million in commodity cost inflation.

“Our focus for the second half of the year is squarely on executing against our strategic priorities. We will continue to step up our brand support through increased advertising and marketing, accelerate our innovation to drive growth and drive our aggressive productivity agenda.”

During the quarter the Frito-Lay North America division had an operating profit of $835 million, down 2% from $853 million during the same quarter of the previous year. Revenue for the quarter was $3,193 million, up 3% from $3,090 million.

The Quaker Foods North America division had an operating profit of $154 million, down 8% from $167 million during the same quarter of the previous year. Revenue for the quarter was $583 million, equal to revenue during the same quarter of the previous year.

PepsiCo Americas Beverages had an operating profit of $840 million, down 15% from $983 million during the same quarter of the previous year. Revenue for the segment was $5,352 million, down 5% from $5,629 million during the same quarter of the previous year.

For the six months ended June 16, the company as a whole saw income decline 14% to $2,615 million, or $1.65 per share, which compared with $3,028 million, or $1.89 per share, during the same period of the previous year.

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