PepsiCo Delivers Solid Third Quarter 2011 Results

Worldwide snacks volume increased 8 percent reflecting broad-based gains in the snacks portfolio and the impact of the WBD acquisition.

Oct 13 2011 --- PepsiCo, Inc. has reported growth in volume, net revenue, operating profit and earnings per share for the third quarter of 2011 driven by top-line gains across its worldwide snacks and beverage businesses and from the acquisition of Wimm-Bill-Dann (WBD), the leading dairy and juice company in Russia. 

"We're focused on growing our business by providing consumers around the globe with great tasting products they love at a good value, and we believe this quarter's performance is a good indication that our efforts are working," said PepsiCo Chairman and CEO Indra Nooyi.  "We had strong revenue growth across our product portfolio and across our key geographic markets.  We were able to achieve pricing to partially offset commodity cost inflation and at the same time stimulate consumer demand for our products.  The result in the quarter was well-balanced top-line and bottom-line growth." 

Worldwide snacks volume increased 8 percent reflecting broad-based gains in the snacks portfolio and the impact of the WBD acquisition.  Excluding the impact of the WBD acquisition, snacks volume grew 3 percent.  Worldwide beverage volume increased 4 percent, including a 3-percentage-point impact from the WBD acquisition.  Volume performance was led by growth in emerging markets, where organic volume increased 8 percent in snacks and 3 percent in beverages. 

Reported net revenue increased 13 percent reflecting the benefits of volume growth, effective net pricing and favorable foreign exchange.  Reported net revenue grew 33 percent in emerging markets.  Excluding the WBD acquisition, net revenue grew 9 percent worldwide and 18 percent in emerging markets.

Total operating profit increased 4 percent on a reported basis, reflecting higher corporate unallocated costs in 2011 that were driven by a postretirement gain in the prior year. Total division operating profit increased 7 percent.  Reported net income increased 4 percent and reported EPS increased 5 percent to $1.25. 

Core division operating profit increased 6 percent, reflecting the benefits of net revenue gains, synergies from the anchor bottler acquisitions, productivity, favorable foreign exchange and the impact of the WBD acquisition, somewhat offset by inflation in commodity and other operating costs.  Core EPS of $1.31 increased 7 percent, driven by operating profit growth and a lower year-over-year core income tax rate.