Despite a “tepid” fourth quarter, PepsiCo still managed a slight turnover growth for its full fiscal year, thanks to snacks covering for sodas’ decreased sales. Net profit did plummet.
Billion dollar write-off thanks to American tax legislation
PepsiCo, which owns sodas like Pepsi and 7Up and snacks like Cheetos and Doritos, managed a 19.5 billion dollar (15 billion euro) fourth quarter turnover, which is pretty much level compared to last year’s fourth quarter. Its 1.4 billion dollar net profit in 2016 plummeted to 710 million dollars (570 million euro). Operational profit did grow from 2.4 to 2.6 billion dollar (slightly above 2 billion euro), but on top of a 226 million dollar restructuring cost, the company also suffered a 2.5 billion dollar write-off because of the new American tax legislation. That fully explains the enormous dip.
CEO Indra Nooyi immediately added that the lower corporate tax rates will benefit PepsiCo’s profit in the years to come.
Target e-commerce more
The company’s full-year turnover grew 1 % to 63.52 billion dollar (nearly 51 billion euro), but profit dropped 23 % to 4.9 billion dollars (3.9 billion euro).
For its current fiscal year, the American soda and snack giant targets “similar growth”. E-commerce will be its main focus: the group currently sells online through marketplaces like Amazon, Walmart and specialized brand sites. In 2017, e-commerce only contributed 2 % to its turnover.
