pepsico

PepsiCo  (PEP) – Get Free Report shares moved higher in pre-market trading after it posted stronger-than-expected third quarter earnings, while boosting its full-year profit forecast, as it continues to pass on price increases in both its snacks and drinks business. 

PepsiCo said earnings for the three months ended in September came in at $2.25 per share, up 14.2% from the same period last year and well ahead of the Street consensus of $2.15 share. 

Group revenues, PepsiCo said, were narrowly ahead of forecast at $23.45 billion and up 6.7% from the same period last year. Organic sales growth, a key figure for earnings potential that separates currency market impacts as well as mergers and acquisitions, rose 8.8% from last year, the company said. 

PepsiCo was able to execute price increases of around 11% over the third quarter, PepsiCo said, down from 15% over the three months ending in June but still solid enough to improve the group’s profit outlook.

Looking into the 2023 financial year, PepsiCo said sees organic revenue growth of around 10% with core earnings for the year rising to $7.54 per share, a 6 cent increase from its prior estimate.

“We are pleased with our performance as our businesses and associates displayed tremendous agility and resilience across geographies and categories in an evolving and dynamic environment,” said CEO Ramon Laguarta. “We believe that our businesses can continue to perform well in the coming years with category growth normalizing, as we have made numerous investments in our brands, manufacturing capacity, go-to-market systems, supply chain, technology, and people, to execute against our strategic framework and modernize our company.”  

“We expect our full-year 2024 organic revenue and core constant currency EPS growth to be towards the upper end of our long-term targets as we advance towards our vision to become the global leader in beverages and convenient foods by winning with pep+,” he added.

PepsiCo shares were marked 2.03% higher in pre-market trading to indicate an opening bell price of $164.64 each, a move that would peg the stock’s six month decline at around 10.1%

Earlier this summer, PepsiCo’s smaller rival, Coca-Cola  (KO) – Get Free Report, also pegged full-year revenues higher, with expected gains of between 8% and 9%, following a stronger-than-expected second quarter earnings report that included price hikes of around 10% across the board, which offset flat overall case volumes.

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