Milling & Baking News - July 16, 2019 - 17

Financial Results

Quaker Foods provides punch for
PepsiCo second-quarter earnings
PURCHASE, N.Y. - Quaker Foods
North America turned in its strongest
quarter of organic revenue growth in
three years, providing a boost to earnings and sales at PepsiCo, Inc. in the
second quarter.
Net income in the second quarter
ended June 15 totaled $2,035 million,
equal to $1.45 per share on the common stock, up 12% from $1,820 million,
or $1.28 per share, in the same period a
year ago. Net revenues increased 2.2%
to $16,449 million in the period.
"We're very pleased with our results for the second quarter," Ramon
L. Laguarta, chairman and chief executive officer, said during a July 9 conference call with analysts. "Organic
revenue grew 4.5% overall, with each
of our six operating sectors contributing to the growth. I believe the solid
growth we had in the second quarter
is a good indication of the strength
of both our product and geographic
portfolios."
Operating profit within the FritoLay North America (F.L.N.A.) division

providing more functional benefits to
its products, he said.
Operating profit within the Quaker
Foods North America (Q.F.N.A.) divibusiness with the aim to drive sus- sion totaled $127 million, down 12.5%
tainable better-than-industry growth, from $145 million a year ago. Net reveand this includes investing in plant nues, meanwhile, increased 2.5% to $540
million from $527 million.
and warehouse capacity,
"The second quarter was
routes, sales technology,
Quaker's strongest quarter
enhanced consumer and
of organic revenue growth
shopper data and insights
in three years, with organic
and brand media. To this
revenue up 3% driven by net
point, in the second quarprice realization and modest
ter, F.L.N.A.'s A.&M. was
volume gains," Mr. Laguarta
up high single digits with
said. "We've restored brand
investments across our
support across the Quaker
portfolio of brands. And
portfolio, and we've returned
we're pleased to note that
to volume growth in Aunt
F.L.N.A. was once again
Jemima and ready-to-eat
the largest contributor to
cereals, each of which delivdouble food and beverage FRITO-LAY NORTH AMERICA
U.S. retail sales growth in the quarter." ered mid-single-digit volume growth."
Overall, net income at PepsiCo in
Mr. Laguarta pointed to two
key trends that have helped boost the six months ended June 15 totaled
F.L.N.A.'s performance. First, the $3,448 million, equal to $2.46 per
move by consumers to smaller packs. share, up 9% from $3,163 million, or
The shift has allowed PepsiCo to real- $2.23 per share, in the same period
ize more pricing, he said. Second, con- a year ago. Net revenues in the six
sumers are looking for higher value months were $29,333 million, up 2.3%
products. PepsiCo is delivering by from $28,652 million a year ago. MBN

PepsiCo, Inc. share price
$136

per share

$127
$118
$109
$100

Aug. Oct. Dec. Feb. Apr. June
2018
2019

totaled $1,249 million in the second
quarter, up 4% from $1,200 million in
the same period a year ago. Net revenue in the division increased 4.5% to
$4,010 million from $3,837 million.
"F.L.N.A. continued to post strong
growth in the second quarter with organic revenue up 5% and solid market
performance," Mr. Laguarta said. "We
delivered good net revenue growth in
our key trademarks, including Lay's,
Doritos, Cheetos and Ruffles. In addition, we posted good growth across all
channels in the U.S., led by high single-digit growth in convenience and
dollar stores.
"We continue to invest across the
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Milling & Baking News - July 16, 2019

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