PepsiCo Q1 Results Top View; Withdraws FY20 Outlook Amid COVID-19

29-Apr-2020 - USA

Snack and beverage giant PepsiCo Inc. (PEP) on Tuesday reported a decline in net income for the first quarter, reflecting higher expenses despite an 7.7 percent growth in revenues.

However, both adjusted earnings per share and net revenues for the quarter beat analysts' estimates. The company also withdrew its earnings and revenue outlook for the full-year 2020.

"Our first quarter results reflect these efforts and the agility of our business which delivered high single-digit net revenue growth," said Chairman and CEO Ramon Laguarta.

For the first quarter, net income attributable to the company declined to $1.34 billion or $0.96 per share from $1.41 billion or $1.00 per share in the year-ago quarter.

The results for both quarters were impacted by restructuring charges and commodity mark-to-market impacts.

Core earnings for the quarter were $1.07 per share, compared to $.97 per share in the year-ago quarter. On average, 17 analysts polled by Thomson Reuters expected the company to earn $1.03 per share for the quarter.

Net revenue for the quarter grew 7.7 percent to $13.88 billion from $12.88 billion last year. Analysts expected revenues of $13.21 billion. Organic revenue growth for the quarter was 7.9 percent.

In the quarter, all its divisions - Frito-Lay North America, Quaker Foods North America, PepsiCo Beverages North America, Latin America, Europe, Africa, Middle East and South Asia as well as Asia Pacific, Australia and New Zealand and China Region - reported higher revenues.

Looking ahead to fiscal 2020, PepsiCo withdrew its core earnings per share and organic revenue growth guidance provided on February 13, 2020, given the uncertainties associated with the magnitude and duration of the COVID-19 pandemic on its business.

"Despite a strong first quarter, there is still a great deal of uncertainty that exists in relation to COVID-19, including how geographies, retail channels and consumer behaviors will evolve over time," Laguarta added. (dpa)

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