PepsiCo Tops Profit Expectations

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CBJ — PepsiCo’s quarterly profit beat estimates of most analysts primarily due to higher pricing of its sodas and snack foods in North America and also because the company sold its minority stake in British bottler Britvic Plc.

PepsiCo sales in its North America beverage unit, the company’s largest, rose 2% to $5.24 billion in the second quarter ended June 17. While volume sales were flat, net pricing was up 1%.

PepsiCo and rival Coca-Cola have focused on selling smaller, higher-margin packs in developed markets while pulling back on promoting large discount packs as they look to cushion the impact of falling demand for carbonated drinks.

Revenue from PepsiCo’s Frito-Lay North America business rose 3%, helped by a 1% uptick in volume and a 3% rise in net pricing.

The company said in May it would sell its 4.5% stake in British bottler Britvic for an undisclosed amount.

Net income attributable to PepsiCo rose to $2.11 billion, or $1.46 per share, from $2.01 billion, or $1.38 per share, a year earlier. Revenue rose 2.1% to $15.71 billion.

The company had said in April it expected margins to remain under pressure in the second quarter as it passes on higher commodity prices to consumers.

PepsiCo raised its adjusted profit forecast for 2017 to $5.13 per share from $5.09, citing lower impact from unfavorable foreign exchange.