PepsiCo Net Benefits from Higher Prices and Volumes, Lifts Outlook
- Scott Peters
- U.S.A. New York City
-
PepsiCo said first-quarter 2022 revenues rose 9.3% and reported better-than-expected earnings on strong performance in its food and beverage businesses. The company also lifted its annual outlook.
PepsiCo, Inc reported first-quarter 2022 revenues increased 9.3% to $16 billion, net income rose 148% to $4.2 billion, and earnings per share increased by the same amount to $3.06 from $1.24 a year ago.
Excluding $3.3 billion benefits from the sale of certain juice brands in North America and Europe, earnings per share were $1.29.
organic revenues increased 13.7% and core earnings per share was $1.29 and increased 7% on constant currency basis.
Impact of exiting from Russia business was $193 million after taxes or 14 cents a share and including all impairment linked to Russia-Ukraine conflict add to $241 million or 17 cents per share.
Frito-Lay North America segment reported quarterly case volume increased 1% and revenues rose 14%.
Quaker Oats North America segment quarterly revenues rose 11% but case volume declined 1.5%.
Pepsico Beverage North America case volume increased 3% and revenues rose 5.5%.
Guidance and Outlook
For the full-year the company lifted its estimate of organic revenue growth to 8% from the previous estimate of 6%.
The food products and beverage maker reiterated its full-year core earnings per share outlook to 8%.
The Company provides guidance on a non-GAAP basis as we cannot predict certain elements which are included in reported GAAP results, including the impact of foreign exchange translation and commodity mark-to-market net impacts.
The Company now expects to deliver 8 percent organic revenue growth (versus our previous guidance of 6 percent) for fiscal year 2022.
Consistent with its previous guidance for 2022, the Company continues to expect:
• An 8 percent increase in core constant currency EPS;
• A core annual effective tax rate of 20 percent; and
• Total cash returns to shareholders of approximately $7.7 billion, comprised of dividends of $6.2 billion and share repurchases of $1.5 billion.
In addition, the Company now expects a 2-percentage-point foreign exchange translation headwind to impact reported net revenue and core EPS growth based on current market consensus rates.
This assumption and the guidance above now imply 2022 core EPS of $6.63, a 6 percent increase compared to 2021 core EPS of $6.26.
Given the strength and resilience of our businesses to date, while reflecting higher than expected input cost inflation for the balance of 2022, we now expect our full-year organic revenue to increase 8 percent (previously 6 percent) and we continue to expect core constant currency earnings per share to increase 8 percent.
Annual Returns
| Company | Ticker | 2025 | 2024 | 2023 |
|---|---|---|---|---|
| Pepsico Inc | PEP | -6% | -5% | -8% |