Economic headwinds, rising costs and uncertainty about the possibility of a tariff war make PepsiCo very cautious for the rest of the year, after a drop in turnover and profit in the first quarter.
Vulnerable
The multinational’s turnover fell 1.8 % to 17.9 billion dollars (16 billion euros) in the first quarter, while net profit fell from over 2 billion dollars to just over 1.8 billion dollars. Consumers are cautious in these uncertain economic times, the snack and drinks producer says. The company expects higher supply costs as a result of the volatile and uncertain trade context.
PepsiCo is in a vulnerable position with the introduction of Trump’s import tariffs. The group produces almost all concentrates for its soft drinks in Ireland, for which a 10 % tariff now applies to imports to the United States. In addition, canned soft drinks are affected by an import duty of 25 % on aluminium. The multinational also produces biscuits and snacks in two factories in Mexico.
Germany provided, at last, some good news for the manufacturer of Pepsi, Lays, Doritos and Quaker: after a price dispute with purchasing alliances Epic and Everest, which dragged on for two and a half years, the products are returning to the shelves of German market leader Edeka, Lebensmittel Zeitung reports.
