10-KPeriod: FY2023

PEPSICO INC Annual Report, Year Ended Dec 30, 2023

Filed February 9, 2024For Securities:PEP

Summary

PepsiCo, Inc. demonstrated resilience in its 2023 fiscal year, navigating global economic uncertainties and geopolitical challenges. The company reported a net revenue increase of 6% to $91.5 billion and a 4% rise in operating profit to $12.0 billion. This growth was driven by effective net pricing across its diverse portfolio of beverages and convenient foods, alongside productivity savings. Despite facing increased commodity, transportation, and labor costs, PepsiCo's "pep+" strategy continues to guide its end-to-end business transformation with a focus on sustainability. Key financial actions included a 7% increase in the annualized dividend and a planned return of approximately $8.2 billion to shareholders in 2024 through dividends and share repurchases. The company also managed its capital structure effectively, with a strong cash generation capability and a robust liquidity position. While facing headwinds such as the conflict in Ukraine and inflationary pressures, PepsiCo's diversified global presence and brand strength position it to manage these challenges and continue delivering value to its shareholders.

Financial Highlights

53 data points
Beta

Revenue

$91.47B

54.2% Gross Margin

Net Income

$9.07B

9.9% Net Margin

EPS (Diluted)

$6.56

Total Assets

$100.50B

Cash & Equivalents

$9.76B

Free Cash Flow

$13.44B

Financial Statements
Beta
Revenue$91.47B
Cost of Revenue$41.88B
Gross Profit$49.59B
R&D Expenses$804.00M
SG&A Expenses$36.68B
Operating Income$11.99B
Interest Expense$819.00M
Net Income$9.07B
EPS (Basic)$6.59
EPS (Diluted)$6.56
Shares Outstanding (Basic)1.38B
Shares Outstanding (Diluted)1.38B

Key Highlights

  • 1Net revenue increased by 6% to $91.5 billion in fiscal year 2023.
  • 2Operating profit grew by 4% to $12.0 billion, with an operating margin of 13.1%.
  • 3Announced a 7% increase in annualized dividend to $5.42 per share, with plans to return $8.2 billion to shareholders in 2024.
  • 4Free cash flow increased by 39% to $8.1 billion.
  • 5The company's 'pep+' strategy continues to drive business transformation with a focus on sustainability across agriculture and value chain.
  • 6Frito-Lay North America (FLNA) and Latin America (LatAm) divisions showed strong net revenue growth.
  • 7PepsiCo Beverages North America (PBNA) saw its operating profit significantly impacted by a prior-year gain from the Juice Transaction and current-year impairment charges.

Frequently Asked Questions

PepsiCo reported a 6% increase in net revenue to $91.5 billion and a 4% increase in operating profit to $12.0 billion for fiscal year 2023. This growth was supported by effective net pricing and productivity savings, despite facing increased operating costs.

PepsiCo announced a 7% increase in its annualized dividend, bringing it to $5.42 per share. The company plans to return approximately $8.2 billion to shareholders in 2024 through a combination of dividends ($7.2 billion) and share repurchases ($1.0 billion).

Key risks include geopolitical instability, particularly the conflict in Ukraine, inflationary pressures on commodity, transportation, and labor costs, supply chain disruptions, evolving consumer preferences, and the competitive landscape. The company also highlighted risks related to climate change, international operations, and cybersecurity.

The 'pep+' strategy is PepsiCo's comprehensive approach to business transformation with sustainability at its core. It focuses on three pillars: Positive Agriculture (expanding regenerative practices), Positive Value Chain (achieving net-zero emissions by 2040, becoming net water positive by 2030, and scaling sustainable packaging), and Positive Choices (evolving the product portfolio towards healthier and more sustainable ingredients).