PepsiCo Inc. reported non-GAAP EPS on Oct. 3 that beat analyst expectations amid a climb in revenue and unfavorable foreign exchange movements. The global food and drinks maker expected to hit or beat its full-year revenue guidance.
The company posted core, or non-GAAP, EPS of $1.56 for the 12 weeks ended Sept. 7, 1% lower than the year-ago period but still ahead of the $1.51 consensus mean estimate for normalized EPS, according to S&P Global Market Intelligence. On a GAAP basis, EPS fell 15% over the previous year to $1.49.
Revenue rose 4.3% to $17.19 billion compared with $16.49 billion in the same quarter of 2018, the company said in its earnings release. Operating profit inched up 0.3% to $2.86 billion from $2.84 billion in the year-ago quarter.
"We are pleased with our results for the third quarter ... We are making good progress against our strategic priorities and our businesses are performing well as we continue to make the necessary investments in our capabilities, brands, manufacturing and go-to-market capacity to propel our future growth," Chairman and CEO Ramon Laguarta said in the release.
The Frito-Lay division, which makes snacks including Doritos, Lays and Cheetos reported the strongest revenue growth at 5%. The Quaker Foods North America arm posted a 12% decline in operating profit despite 1% revenue growth.
The company expects to meet or exceed a full-year organic revenue target of 4% and expects to generate approximately $9 billion in cash from operating activities and free cash flow of approximately $5 billion, based on net capital spending it estimates at about $4.5 billion.
It assumed a 2 percentage point foreign exchange headwind in its full-year outlook, which would imply earnings per share from its core business of $5.50, down 3% from 2018's $5.66.
PepsiCo said it expected to distribute dividends of about $5 billion and repurchase about $3 billion of stock in circulation.
New York-traded PepsiCo shares rose 2.2% in early trading on Oct. 3 to $136.90.
