PepsiCo AMESA revenues decline 8% in Q2 as group earnings surpass analyst expectation
AMESA – PepsiCo, one of the world’s leading food and beverage companies, has reported an 8% fall in revenue from its Africa, Middle East, and South Asia (AMESA) business in the financial results for the second quarter of 2023.
The revenue in the AMESA region decreased from US$1.69 billion in the previous year’s quarter to US$1.57 billion.
The beverage giant did not explain the reason behind the shrinkage in revenue but did acknowledge a global fall in demand for its drinks and food.
The group has, however, posted an exceptional performance that has surpassed analysts’ expectations. PepsiCo reported net revenue of US$22.32 billion for the second quarter, marking a significant 10% increase from US$20.5 billion in the same period last year.
PepsiCo attributed the impressive growth to a combination of strategic initiatives, successful product launches, and effective marketing campaigns across its diverse portfolio of brands.
The company’s organic revenue, which strips out the impact of acquisitions and divestitures, rose 13% in the quarter.
The Frito-Lay North America segment posted organic revenue growth of 14%. Organic revenue in the Quaker Foods North America division grew only 2% this quarter versus a double-digit increase last year.
PepsiCo Beverages North America reported an organic revenue of 10% with gains in Gatorade, Pepsi, and Rockstar. PepsiCo’s International convenience foods business saw organic revenues grow by 17% in Q2 while the beverages business witnessed revenue growth of 13%.
The company also recorded double-digit revenue growth in developed markets like Australia and the UK as well as emerging markets like Mexico, Turkey, and Poland.
The company’s volume however fell as higher prices for its snacks and drinks hurt demand. Volume, which excludes pricing and currency fluctuations, dropped 3% for Pepsi’s food divisions and 1% for its beverages.
Ramon Laguarta, Chairman and CEO of PepsiCo said: “We are delighted with our second-quarter results, which demonstrate our ability to drive sustainable growth and deliver on our strategic objectives. Our focus on innovation, portfolio diversification, and consumer-centricity has allowed us to thrive in a challenging environment.”
Based on its strong performance, PepsiCo raised its guidance for the full year 2023 and now expects an organic revenue rise of 10% compared to its previous outlook of 8%, and core constant currency EPS to grow 12% versus the earlier expectation of a growth of 9%.
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