Snack portfolio buoyed business in 2009

Snack portfolio buoyed business in 2009

US food and drink giant PepsiCo has reported a 16% increase in full-year profits, driven by gains in its worldwide snack and international beverage businesses.

In 2009, PepsiCo earned US$5.95bn compared to $5.14bn in 2008. However, revenue remained flat at $43.23bn.

On a non-GAAP basis, PepsiCo said annual "core" net income dipped 1% to US$5.85bn.

PepsiCo's "core" numbers excluded restructuring linked to its Productivity for Growth initiative, the company's share of restructuring and impairment charges at bottler Pepsi Bottling Group in 2008 and costs associated with its proposed mergers with PBG and another bottler, PAS.

The "core" numbers also exclude the commodity mark-to-market net impact included in corporate unallocated costs.

PepsiCo Americas Foods grew net revenue 7% and core operating profit 8% in 2009 and gained snacks share across the region.

Frito-Lay delivered a 6% increase in net revenue and a 7% increase in core operating profit, on top of similar gains in 2008.

However, sales and volumes in the firm’s Quaker Foods North America division remained flat. Core operating profit grew 3% but was adversely impacted by the overlap of a flood-related insurance settlement in the year-ago quarter.

PepiCo's Latin America Foods division performed “very well” in 2009, growing net revenue 10% and core operating profit 13% despite “very challenging macros” in Mexico.

PepsiCo said it anticipates 2010 earnings will rise 11% to 13% on a constant currency basis.

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