On a constant currency basis, EPS rose 10% on revenue growth of 4%. On a GAAP basis, revenues were flat and EPS was up 15%.
The better-than-expected results are due largely to cost-cutting and higher snack-food sales. Soft drink sales were down 1% in North America and the same amount in Latin America.
ALSO READ: Diet Pepsi Sales Plunge
At the end of the 2013, Pepsi raised its annual dividend from $2.27 a share to $2.62, effective in June. The company reaffirmed its plans to repurchase approximately $5 billion in stock during 2014. The company also reiterated its earlier statement that the combined effect of these programs will return about $8.7 billion to stockholders in 2014.
In its outlook, Pepsi continues to expect to grow adjusted EPS by 7% in 2014 compared with 2013. That translates to EPS of around $4.68. Currency translation effects are expected to have a negative impact of around 3% on 2014 EPS growth.
The company also expects to organic revenue growth in the mid-single digits and productivity savings of $1 billion. Pepsi expects commodity price inflation in the low single-digit range for 2014.
The company’s CEO said:
PepsiCo delivered mid-single-digit organic revenue growth and double-digit core constant currency earnings per share growth, despite ongoing macroeconomic volatility, political instability and other challenging marketplace conditions in a number of our key market. … We remain confident in achieving our financial goals for the full year and believe that we have the right strategies in place to create long-term value for our shareholders.
No word on whether Pepsi is the rumored potential buyer of a stake in SodaStream, but maybe that will be addressed during the conference call.
PepsiCo shares were down about 0.6% in premarket trading, at $81.00 in a 52-week range of $71.50 to $87.06. Thomson Reuters had a consensus analyst price target of around $91.00 before this report.
Get Ready To Retire (Sponsored)
Start by taking a quick retirement quiz from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes, or less.
Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.
Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future
Get started right here.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.