Strong operating performance from its Frito-Lay North America division has contributed to solid first quarter results for PepsiCo, which remains confident that it will achieve its 2019 financial targets.
In the six months since chief executive Ramon Laguarta took over from Indra Nooyi, PepsiCo has been progressing on an ambitious agenda to add capacity and strengthen its brands, with China viewed as an important engine for future growth. Sustainability is another key theme promoted by Laguarta.
Group revenues for the period were $12.88 billion, up 2.5 per cent from the same period last year. Net revenue growth for the quarter was 2.6 per cent, while earnings per share (EPS) was also up 6 per cent, despite taking a slight hit due to investments in the business and tax increases.
“We are pleased with our results for the first quarter,” said Laguarta. “While adverse foreign exchange translation negatively impacted our reported net revenue performance, our underlying organic revenue growth accelerated to more than 5 per cent in the quarter. Frito-Lay North America and each of our international divisions delivered particularly strong operating performance, and PepsiCo Beverages North America generated sequential quarterly net revenue acceleration.”
Frito-Lay is performing particularly well due to strong demand for premium snacking options, with brands including SunChips, Smartfood and Simply.
PepsiCo is either number one or number two in most of its key markets.