PepsiCo (PEP) - Get Report posted stronger-than-expected fourth quarter earnings Thursday, and forecast solid sales growth for 2020, as snack revenues continue to support the group's overall top line.
PepsiCo said core earnings for the three months ending in December were pegged at $1.45 per share, down 4 cents from the same period last year but a penny ahead of the Street consensus forecast. Group revenues, the company said, fell 9.75% from last year but topped analyst's estimates with a $20.64 billion tally.
Looking into the 2020 financial year, PepsiCo said it sees 4% organic revenue growth, compared to 4.5% for 2019, and 7% growth for core earnings on a constant currency basis. The EPS guide suggests a full-year target of $5.88 per share, however, around 7 cents shy of the Refinitiv forecast of $5.95 per share.
“We are pleased with our performance for 2019 as we met or exceeded each of the financial goals we outlined at the beginning of the year. Our revenue growth accelerated for the full year as we embarked on our strategy to win with purpose by becoming Faster, Stronger, and Better," said CEO Ramon Laguarta. "We increased brand support to become more locally relevant and consumer-centric, we strengthened our go-to-market execution to enhance our customer relationships, and we embraced a new set of initiatives to help build a more sustainable food system.
“For 2020, we expect to deliver 4% organic revenue growth and 7% core constant currency EPS growth," he added. "We will continue to invest in our business and strive to develop advantaged capabilities that will fortify our business for the long-term.”
PepsiCo share were marked 1.35% lower in early trading following the earnings release to change hands at $144.08 each, trimming its six-month gain to around 11%.
PepsiCo said Frito-Lay profits rose 3% from last year, alongside a 3% growth rate for revenues, while North American Beverages profits rose 5%.