PepsiCo tops estimates after cutting costs, boosting snack sales
By Bloomberg
PepsiCo Inc., the world’s largest snack maker and second-largest beverage company, posted first-quarter profit that topped analysts’ estimates after cutting costs and boosting sales of its Frito-Lay lineup in North America.
Profit was 83 cents a share, excluding some items, the Purchase, New York-based company said Thursday in a statement. The average of analysts’ estimates compiled by Bloomberg was 79 cents.
Chief Executive Officer Indra Nooyi, after fending off activist investor Nelson Peltz’s attempt to split up PepsiCo’s snack and beverage units, is working to prove that the company is better off with the businesses together. The company said Thursday that it’s on track to achieve $1 billion in productivity savings this year.
“We have generally been encouraged by improvements in PepsiCo’s beverage business and ongoing solid results in snacks,” Bonnie Herzog, an analyst for Wells Fargo & Co., said in a note before the results were released.
The shares rose in early trading on Thursday. PepsiCo had gained 2.9 percent this year through Wednesday’s close, compared with a 2.4 percent advance for the Standard & Poor’s 500 Index.
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