PepsiCo is a well known brand among the public here in Syracuse. The wide variety of tasty products offered by PepsiCo has made this a popular firm here. And so there has been some concern in Syracuse about a report of declining profits for PepsiCo.
Christopher Hinton and William Spain have written for the Wall Street Journal MarketWatch "PepsiCo’s profit falls on higher costs", http://bit.ly/fVA4cc. Rising commodity prices have hurt the income of PepsiCo Inc. This giant beverage and snack firm has posted a 5% decline in fourth-quarter profit on Thursday. Shares of PepsiCo (PEP) fell more than 1% in premarket trading to $63.55 after release of this news. The stock is up about 7% over the past year, but it has fallen 1.3% over the past three months.
PepsiCo, which is based in Purchase, N.Y., said it earned $1.36 billion, or 85 cents a share, in the quarter, which was down from $1.43 billion, or 90 cents a share, in the year-earlier period. The core earnings were $1.05 a share in the latest quarter. However, revenue for the firm rose to $18.12 billion from $13.3 billion, helped by the company’s acquisition of two bottlers last year.
FactSet Research said that the average estimate of analysts polled had been for the company to earn $1.04 a share on revenue of $17.5 billion. Beverage volume for PepsiCo grew 1%, while Frito-Lay snack volume ”grew slightly.” Overseas markets in Asia, the Middle East and Africa did well and were considered standout overseas markets.
PepsiCo, which is the owner of Pepsi, Frito-Lay, Tropicana and Quaker brands, said it expects core earnings-per-share growth of 7% to 8% in 2011. Indra Nooyi, chief executive of the firm has said “We are encouraged by the momentum of our businesses as we enter 2011, and are mindful of three realities." She said those realities included weakening demand because of the high level of unemployment in key developed markets; higher levels of cost inflation driven by higher commodity prices; and a potentially difficult competitive pricing environment, particularly in beverages.
The Syracuse community will be watching these developments with PepsiCo with interest. PepsiCo offers snacks, foods and drinks that the firm feels satisfies consumers’ changing preferences, delivers exceptional taste and offers greater benefits. PepsiCo feels its product portfolio makes it more enjoyable to lead a healthier life. Many people here in Syracuse agree with this positive image of PepisCo and are optimistic the firms profits will improve in the future.
Photographer: Paul .
Mandel News Service: http://www.mandelnews.com
