Summary
PepsiCo Inc. reported solid financial results for the first quarter of fiscal year 2024, with net revenue increasing by 2% to $18.25 billion and operating profit rising by 3% to $2.72 billion compared to the same period last year. This growth was driven by effective net pricing strategies across its divisions, particularly in Latin America and Europe, which more than offset a slight decline in organic volume globally. A significant factor impacting profitability was the voluntary recall of certain Quaker products, which resulted in an $167 million charge and negatively affected the Quaker Foods North America (QFNA) segment's operating profit. Despite this, the company demonstrated resilience, with strong performance in international segments like Latin America and Europe contributing positively to overall results. Management's focus on productivity savings and strategic pricing actions are key to navigating cost pressures and maintaining margin expansion.
Financial Highlights
51 data points| Revenue | $18.25B |
| Cost of Revenue | $8.25B |
| Gross Profit | $10.00B |
| SG&A Expenses | $7.29B |
| Operating Income | $2.72B |
| Interest Expense | $202.00M |
| Net Income | $2.04B |
| EPS (Basic) | $1.49 |
| EPS (Diluted) | $1.48 |
| Shares Outstanding (Basic) | 1.38B |
| Shares Outstanding (Diluted) | 1.38B |
Key Highlights
- 1Net revenue increased by 2.0% to $18.25 billion, while operating profit grew by 3.0% to $2.72 billion year-over-year.
- 2Effective net pricing was a key driver of revenue growth, contributing 5% to organic revenue growth globally, offsetting a 2% decline in organic volume.
- 3The Quaker Foods North America (QFNA) segment experienced a significant 24% revenue decline and a 126% operating profit decline, heavily impacted by a $167 million product recall charge.
- 4International segments showed robust growth, with Latin America up 16% and Europe up 3% in net revenue, driven by strong pricing and volume improvements in most markets.
- 5PepsiCo declared a quarterly dividend of $1.265 per share, an increase from the prior year, and plans to return approximately $8.2 billion to shareholders in 2024 through dividends and share repurchases.
- 6The company's balance sheet remains strong, with total assets of $100.04 billion and total liabilities of $80.85 billion as of March 23, 2024.
- 7Cash flow from operations was a net cash used of $1.04 billion, significantly impacted by unfavorable working capital movements, leading to a negative free cash flow of $1.65 billion for the quarter.