PepsiCo Sales Fall, Driven by Beverage Segment -- Update
July 13 2020 - 7:39AM
Dow Jones News
By Dave Sebastian
PepsiCo Inc. posted lower revenue for the latest quarter as it
made less in its main beverage segment, though its snacks sales
rose as Covid-19 shelter-in-place measures and closures eased
during the period.
The beverage giant on Monday said second-quarter sales fell 3.1%
from the prior year to $15.95 billion. Analysts polled by FactSet
were expecting $15.37 billion.
Pepsi's organic revenue, which strips out the effect of currency
swings and acquisitions, was off 0.3% for the period.
"As restrictions and closures eased and population mobility
improved as the quarter progressed, we [saw] an improvement in our
business performance and channel mix dynamics," Chairman and Chief
Executive Ramon Laguarta said. "However, the environment has
remained volatile and much uncertainty remains about the duration
and long-term implications of the pandemic."
Revenue at its North American beverage division, the company's
biggest contributor, fell 6.6% to $4.97 billion.
In its Frito-Lay North America division, which makes Doritos,
Lays potato chips and other snacks, sales rose 6.6% to $4.27
billion. Sales at Quaker Foods North America rose 23% to $664
million.
PepsiCo's packaged-food unit that sells Aunt Jemima products
last month said it would retire the brand because of its origins in
racist imagery of Black people amid a national reckoning over
racial justice following the killing of George Floyd.
Latin America sales fell 17%, Europe sales fell 9.2% and sales
in the Asia-Pacific, Australia, New Zealand and China region rose
9.9%. In Africa, the Middle East and South Asia, sales were off
1.4%.
Net income fell to $1.65 billion, or $1.18 a share, from $2.04
billion, or $1.44 a share, in the comparable quarter last year.
Adjusted earnings were $1.32 a share, ahead of the $1.25 a share
analysts were looking for.
The company said it expects a fiscal 2020 revenue and core
earnings per share to be hurt by a 3 percentage-point
foreign-exchange translation effect.
(END) Dow Jones Newswires
July 13, 2020 07:24 ET (11:24 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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