PepsiCo boosted its full-year forecasts for the second time in three months, as resurgent demand at restaurants and arenas powered quarterly sales.
Net revenue at the US-based food and beverage company rose 11.6 per cent year on year to $20.2bn in the three months to the beginning of September, eclipsing analysts’ expectations of $19.4bn. Organic sales were up 9 per cent.
The company said it expected both the snacks and beverage businesses in North America to remain resilient through the remainder of the year, while its international markets should perform well despite uneven economic recoveries.
PepsiCo predicted that organic sales would grow 8 per cent year on year in 2021, up from a prior estimate of 6 per cent. Adjusted earnings per share, excluding one time charges, were on track to climb “at least” 12 per cent, PepsiCo said. It previously forecast exactly 12 per cent growth.
During the pandemic, homebound consumers stocked up on grocery items from salty snacks to pancake mix, but closures and limited capacity at restaurants, cinemas and sporting events dragged on demand for PepsiCo’s fizzy drinks.
But the rollout of Covid-19 vaccinations and the removal of most coronavirus-related restrictions have underpinned a recovery in sales at public venues this year.
The company’s North America beverage sales in the food-service sector grew by double digits compared with the third quarter last year. Its Frito-Lay snack business in North America also posted strong net revenue growth in food services and at convenience stores.
Ramon Laguarta, chief executive, said the third-quarter results were strong despite a “dynamic and volatile supply chain and cost environment”.
PepsiCo earned $1.79 per share on an adjusted basis in the quarter. Analysts were looking for a smaller per-share profit of $1.73.