PepsiCo (PEP) earnings in Q1 2022 beat estimates

Pepsi products go on sale at a Target store on March 8, 2022 in Los Angeles, California.

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PepsiCo on Tuesday reported quarterly earnings and revenue that topped analysts’ expectations as consumers paid more for their Doritos, Quaker oatmeal and Gatorade.

On the heels of its strong performance, the company raised its full-year forecast for organic revenue growth.

The company’s shares were unchanged in pre-market trading.

Here’s what the company reported compared to what Wall Street expected, based on a survey by analysts from Refinitiv:

  • Earnings per share: $ 1.29 adjusted against expected $ 1.23
  • Revenue: $ 16.2 billion versus expected $ 15.56 billion

Pepsi reported first-quarter net income attributable to the company at $ 4.26 billion, or $ 3.06 per share, up from $ 1.71 billion or $ 1.24 per share a year earlier.

The food and beverage giant reported a $ 193 million write-down fee after tax as it attempts to discontinue or relocate some of its juice and dairy brands in Russia. The tax reduced earnings by 14 cents per. shares. An additional $ 241 million post-tax write-down fee related to the Russia-Ukraine conflict weighed earnings at 17 cents per share. shares.

In March, Pepsi joined a host of other Western countries to suspend some of its Russian business, but failed to suspend sales completely as rival Coca-Cola. Pepsi generates about 4% of its annual revenue in Russia, making the country one of the few markets where it has a larger presence than cola. Pepsi said it will continue to sell some important products, such as baby substitutes, milk and baby food.

Excluding the sale of its juice business, the Russian impairment and other items, the company earned $ 1.29 per share. share, which peaked at $ 1.23 per share. stock that analysts had expected from Refinitiv.

Net sales rose 9.3% to $ 16.2 billion, beating expectations of $ 15.56 billion. Organic revenue increased 13.7% during the quarter, mainly driven by higher prices.

The company’s North American beverage business reported a volume growth of 3%. This quarter marked the launch of Pepsi’s trial of alcohol with Hard Mtn Dew, made in collaboration with Boston Beer.

Frito-Lay North America saw a volume increase of only 1% during the quarter, although the segment’s organic revenue increased by 14%. The company said Doritos, Lay’s, Ruffles and Cheetos all experienced double-digit revenue growth.

Quaker Foods was the only North American business unit to report declining volume during the quarter. The segment has struggled to hold on to the consumers it got in the early days of the pandemic, where more people ate breakfast at home. Still, Pepsi said it won market share in the categories of rice and pasta, light snacks, ready-to-eat cereals and snack bars.

For the full year, Pepsi now expects organic revenue growth of 8%, up from its previous forecast of 6%. The company reiterated its forecast for full-year growth in core earnings per. share of 8%.

Read the full press release here.

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