PepsiCo (PEP) said Thursday it was planning for growth in 2021 as strong beverage and snack sales, boosted by the coronavirus lockdown, helped the consumer foods giant beat Wall Street's fourth-quarter earnings expectations.
Shares of the Purchase, N.Y., company were up modestly to $138.10 in premarket trading Thursday.
PepsiCo reported net income of $1.85 billion, or $1.33 a share, compared with $1.77 billion, or $1.26 a share, a year ago.
Excluding nonrecurring items, earnings were $1.47 a share, ahead of analysts' estimates of $1.46.
Revenue increased 8.8% to $22.5 billion, exceeding the FactSet consensus of $21.8 billion.
"We ended the year on a strong note with our global beverage business having accelerated while our global snacks and food business remained resilient in the fourth quarter," Chairman and CEO Ramon Laguarta said in a statement.
PepsiCo said organic sales rose 5% at its Frito-Lay division, and increased 8% at Quaker Foods North America.
For 2021, PepsiCo guided to a mid-single digit increase in organic revenue and a high-single digit gain in earnings per share excluding currency fluctuations.
The company also announced a 5% increase in its annualized dividend to $4.30 a share from $4.09.
"We assume that vaccination efforts will accelerate and that population mobility trends will gradually improve as consumers return to certain pre-pandemic behaviors by the second half of this year," CEO Ramon Laguarta said, according to Reuters.
Consumers are staying inside more as a result of the coronavirus pandemic and data from the COVID Symptom Study suggests the lockdown has led to increased snacking and increased alcohol consumption in the U.S.
Separately, PepsiCo on Wednesday rebranded its pancakes products to Pearl Milling Co., dropping the Aunt Jemima name, saying the original brand's origins were based on a racial stereotype.