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PepsiCo Q2 revenue declines 3.3% to $15.39bn

DBR Staff Writer Published 11 July 2016

PepsiCo has reported a 3.3% decline in its second-quarter revenue to $15.39bn, compared to $15.92bn for the same period in 2015.

Net income attributable to the company increased 1% to $2.01bn from $1.98bn last year.  Earnings per share rose 4% to $1.38 from prior year's $1.33.

Core earnings, which excluded several items, were $1.971bn, or $1.35 per share, compared to $1.972bn, or $1.32 per share last year.

The company said the deconsolidation of its Venezuelan operations had an unfavorable 3-percentage-point impact on both reported and core earnings per share.

In Q2, Frito-Lay North America, Quaker Foods North America and North America Beverages recorded higher sales, positively impacted by productivity gains, and lower raw material costs.

Sales Latin America have declined 23%, mainly due to a 21 percentage points impact of the Venezuela deconsolidation, higher raw material costs, and adverse foreign exchange translation of 13 percentage points.

Looking ahead, the company expects core earnings per share of $4.71 for fiscal 2016, higher than earlier estimate of $4.66.

PepsiCo chairman and CEO Indra Nooyi said: "In what continues to be an incredibly volatile global macro environment, we are pleased with our results for the second quarter.

“While reported net revenue performance was negatively impacted by foreign exchange translation and the deconsolidation of our Venezuelan operations, we delivered balanced volume growth and positive price/mix driven by relentless execution of our commercial agenda and leading to solid organic revenue growth.”

The company continues to expect to return a total of about $7bn to shareholders via dividends of nearly $4bn and share repurchases of approximately $3bn.

Image: PepsiCo headquarters in Purchase, N.Y. Photo: courtesy of PepsiCo.