PEP PepsiCo Inc

By Jennifer Maloney 

PepsiCo Inc. doesn't expect people to stop munching on Cheetos any time soon.

The company said it projects a gradual rebound in its soda business as Covid-19 vaccines roll out and consumers head back to restaurants and other venues, while growth in its food business will endure as people continue to work -- and snack -- at home.

"I think it'll evolve slowly over time," PepsiCo Chief Financial Officer Hugh Johnston said in an interview. "I'm not expecting any kind of a dramatic change."

One of the habits Mr. Johnston said he expects people will keep, even as life returns to normal, is eating breakfast at home -- a trend that has boosted the company's Quaker Oats business. "What we've seen is people like breakfast at home and I think they'll probably continue that pattern," he said.

Sales of Cheetos, Tostitos, oatmeal and pancakes have propelled the snacks and beverage giant through the coronavirus pandemic, offsetting soda sales weakened by the shuttering of restaurants, movie theaters and sports stadiums. The company's North America beverage sales volume fell by 1.5% in 2020 and was flat in the fourth quarter.

After a sharp drop in the second quarter, soda sales improved in the second half of the year as people ventured out and made more purchases at convenience stores.

Rival Coca-Cola Co. on Wednesday said a worse-than-expected winter of pandemic-related restrictions led to declines in its soda sales.

Meanwhile, Molson Coors Beverage Co. Thursday reported that its net sales revenue fell 7.7% in the most recent quarter, partially offset by sales growth in the U.S.

PepsiCo on Thursday offered an outlook for 2021, saying it expects organic revenue to grow this year by a percentage in the mid-single digits, and for its adjusted earnings to grow by a high-single-digits percentage. PepsiCo also said it would increase its annualized dividend to $4.30 a share, from $4.09 a share, beginning with the dividend to be paid in June.

PepsiCo's organic revenue grew 5.7% in the latest quarter.

Write to Jennifer Maloney at jennifer.maloney@wsj.com

(END) Dow Jones Newswires

February 11, 2021 09:55 ET (14:55 GMT)

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