PepsiCo Q4 Adj. EPS Tops Estimates, But Revenues Miss

(RTTNews) - Snack and beverage giant PepsiCo, Inc. (PEP) on Friday reported that net income for the fourth quarter soared from last year, reflecting lower impairment of intangible assets this year and 18 percent revenue growth in Latin America.

Core earnings per share topped analysts' estimates, while annual revenues miss it. The company also initiated its core earnings and organic revenue growth guidance for the full-year 2024.

"Our results demonstrate that the investments we have made to strengthen our business and advance our pep+ agenda are working: it's evident in how we are innovating, operating, empowering our teams, building our brands, and competing in the marketplace," said Ramon Laguarta, Chairman and CEO.

For the fourth quarter, net income attributable to the company soared to $1.30 billion or $0.94 per share from $518 million or $0.37 per share in the year-ago quarter.

Core earnings for the quarter were $1.78 per share, compared to $1.67 per share in the year-ago quarter. On average, 16 analysts polled by Thomson Reuters expected the company to earn $1.72 per share for the quarter.

Net revenue for the quarter edged down 0.5 percent to $27.85 billion from $28.00 billion in the same quarter last year. Analysts expected revenues of $28.40 billion. Organic revenue growth for the quarter was 4.5 percent.

In the quarter, Frito-Lay North America, Quaker Foods North America, PepsiCo Beverages North America, Europe, Africa, Middle East and South Asia as well as Asia Pacific, Australia and New Zealand and China reported lower revenues. Only revenues in Latin America increased.

Convenient Foods volume dropped 3 percent and beverages volume declined 2 percent from last year.

Looking ahead to fiscal 2024, PepsiCo now projects core constant currency earnings per share growth of at least 7 percent, implying core earnings per share of $8.15, on organic revenue growth of at least 4 percent. The Street expects earnings of $8.14 per share on revenues of $93.31 billion for the year.

The Company also announced a 7 percent increase in its annualized dividend to $5.42 per share from $5.06 per share, effective with the dividend expected to be paid in June 2024. The company also plans to repurchase approximately $1 billion worth of shares.

"Moving forward, we will further sharpen our focus on providing consumers great-tasting products that offer convenience and compelling value. We will also aggressively manage our costs to accelerate productivity, and invest more in our brands, innovation, channel expansion and pep+ transformation," added Laguarta.

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