USA – PepsiCo, the American multinational food, snack, and beverage corporation, has reported a notable increase in net income for the second quarter of 2024, reaching US$3.08 billion.
Net sales for the quarter grew nearly 1 percent to US$22.5 billion, driven largely by PepsiCo’s robust international business.
The company’s organic revenue, which excludes the effects of acquisitions, divestitures, and currency fluctuations, increased by 1.9 percent, attributed to strong performance in PepsiCo’s global markets.
However, the company implemented a 5 percent price hike on its products, consistent with the first quarter, which contributed to a 3 percent decline in overall organic volumes.
Ramon Laguarta, Chairman and CEO of PepsiCo, remarked, “During the second quarter, our business delivered net revenue growth, strong gross and operating margin expansion, and double-digit EPS growth.
We managed to remain agile despite challenging net revenue comparisons from the prior year, subdued performance in North American convenient foods, and the impacts of certain product recalls at Quaker Foods North America.”
Laguarta added, “As a result, we now expect to deliver approximately 4% organic revenue growth, slightly revised from the previous forecast of at least 4%, and are confident in achieving at least 8% core constant currency EPS growth for the full year 2024.”
In the second quarter, PepsiCo saw impressive growth in developing and emerging markets. Egypt and Poland achieved double-digit organic revenue growth, while India and Brazil recorded high-single-digit increases.
Thailand and Pakistan experienced mid-single-digit growth, with Mexico and South Africa seeing low-single-digit gains. In developed international markets, Australia and the UK both posted low-single-digit organic revenue growth.
“Year-to-date, we have held or gained savory snack shares in multiple countries, including China, India, Brazil, Australia, and Pakistan. In beverages, we maintained or gained share in various markets such as Australia, South Korea, China, Thailand, Pakistan, Egypt, Vietnam, Saudi Arabia, the UK, and Brazil,” the company noted.
PepsiCo remains optimistic about growth prospects within its US$36 billion international segment, which made up nearly 40 percent of its annual net revenue in 2023 and features an expanding core operating margin.
Data from NielsenIQ showed sales at Frito-Lay North America, the company’s snacking business that sells Lay’s and Doritos chips, fell nearly 1.3 percent in the four weeks ended June 15, while the overall salty snacks category in the US. saw a smaller 0.7 percent.
Frito-Lay North America, which contributed 27% to PepsiCo’s total revenue in fiscal 2023, is the company’s second-largest business unit after North America beverages, which accounts for about 30% of overall sales.
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