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PepsiCo exceeded expectations with quarterly growth of 5.3%. Thanks to the brand manufacturer’s snacks and crisps, which are doing remarkably well in times of corona.
People keep snacking
PepsiCo saw its net sales increase by 5.3% in the past quarter. In total, sales amounted to 18.09 billion dollar, compared to an analyst consensus of 17.23 billion euros. The crisps and cola producer also delivered more profit than analysts had expected. Adjusted earnings came to 1.66 dollar per share, while Wall Street assumed 1.49 dollar. A year’s net profit was 2.1 billion dollar, now it is 2.29 billion dollar.
The snack divisions Frito-Lay and Quaker Foods in particular performed well with organic sales growth of 6%, despite the end of lockdowns and life outside the home gradually returning to normal in the third quarter. In the US, PepsiCo is even struggling to keep up with demand for the new Cheetos variant ‘macaroni and cheese’, CNBC knows.
Soft drinks lag behind
In North America, beverage sales grew 3%, although Lipton tea and Starbucks coffee products achieved double-digit growth rates. Outside its US home market, PepsiCo recorded organic sales growth of 4%, again driven by snacks. The recovery in soft drink sales will be slower in Europe, according to CEO Ramon Laguarta, due to new local corona measures, which continue to hamper on-trade and event consumption.
For the remainder of 2020, PepsiCo now expects sales growth of 4%, just as the company had previously forecast, and earnings per share of 5.5 dollar. That is 38 cents less than the original forecast.
