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PEPSICO'S NET INCOME SURGES 20 PERCENT IN SECOND QUARTER; EPS JUMPS 23 PERCENT

 PEPSICO'S NET INCOME SURGES 20 PERCENT IN SECOND QUARTER;
 EPS JUMPS 23 PERCENT
 PURCHASE, N.Y., July 21 /PRNewswire/ -- PepsiCo's (NYSE: PEP) net income grew 20 percent to $383.0 million in the second quarter of 1992, earnings per share advanced 23 percent to $0.48, and sales grew 11 percent to $5.2 billion.
 Wayne Calloway, Chairman and Chief Executive Officer of PepsiCo, said, "Over the last couple of years, we've put in place a number of major programs and strategies to ensure continued vigorous growth. Our second quarter results indicate that most of these initiatives are working well and on schedule. Our earnings momentum is particul arly exciting because it's based on strong and balanced operating results, with all three lines of business achieving double-digit growth in both their U.S. and international operations."
 Snack Foods Operating profits for worldwide snack foods jumped 23 percent to $254.0 million on sales growth of nine percent to $1.4 billion.
 Domestic profits rose 21 percent to $191.5 million on a sales increase of six percent to $953.2 million. The increases in sales and profits were driven by solid volume gains. Profit growth also reflected the impact of unusually high potato costs last year and lower G&A costs this year resulting from the 1991 organizational restructuring.
 Domestic pound growth was more than seven percent in the quarter and six percent year-to-date. The gain in the quarter was led by extraordinary growth in Lay's and Ruffles driven by new advertising, increased promotional spending, improved quality and the lapping of the potato shortage last year. Tostitos and Sunchips also contributed to growth.
 "I'm particularly pleased with Frito-Lay's marketplace performance this quarter," said Mr. Calloway. "They generated strong volume growth and made significant gains in market share while holding net prices. This performance exemplifies Frito-Lay's position as the leader of the snack food industry."
 International snack food profits grew a strong 30 percent to $62.5 million on a sales increase of 18 percent to $491.7 million. The sales increase was largely driven by acquisitions in Poland and Australia as well as pricing in several countries.
 The profit increase was driven by gains in Mexico and Spain.
 International snack chip kilos were flat for the quarter and year- to-date. In the quarter, volume reflected growth in Mexico and Spain offset by lower volumes in Brazil and the U.K. Beverages Worldwide beverage profits grew 15 percent to $295.3 million on a sales increase of nine percent to $1.9 billion.
 Domestic profits grew 11 percent to $238.6 million on sales growth of five percent to $1.3 billion. Sales growth was primarily the result of bottler acquisitions. Profits reflected higher pricing in both the concentrate and bottling businesses with bottling pricing on a strong upward trend year to date. Profits also benefited from lower ingredients and packaging costs.
 Domestic bottler case sales grew three percent for the quarter and year-to-date. It should be noted that bottler case sales for the quarter cover only April and May, a practice consistent with prior years. Preliminary data indicates that volume in June is below year ago levels and that the calendar quarter is up slightly versus last year. The three percent growth in the reported quarter was driven by the Mountain Dew brands and Diet Pepsi, which benefited from the "Uh huh" month promotion in April. This growth was also enhanced by the inclusion of Easter which fell in the second quarter this ye ar versus the first quarter last year.
 International beverage profits surged 36 percent to $56.7 million on a sales gain of 21 percent to $533.7 million. Profit growth reflected increased concentrate pricing and shipments partly offset by lower bottling profits in Canada. Sales growth was driven by acquisitions of franchised bottlers in Canada, and by higher concentrate pricing and volume.
 International bottler case sales grew a strong eight percent in the quarter and nine percent year-to-date. Growth in the quarte r was geographically broad based.
 Restaurants Operating profits for worldwide restaurants rose 15 percent to $178.0 million driven by a sharp rebound in domestic KFC earnings and strong international results.
 Sales grew 5 percent to $1.9 billion.
 Pizza Hut - Operating profits increased two percent in the second quarter to $80.0 million against a difficult comparison with the second quarter of last year when profits grew 22 percent. Sales advanced 10 percent to $816.0 million.
 Domestic profits were flat reflecting a volume decline in the traditional business and higher cheese costs offset by a lower level of price discounting.
 Same store sales for domestic company-owned stores declined one percent in the quarter and year-to-date reflecting declines in the traditional units partly offset by growth in the delivery units.
 KFC - Operating profits surged 50 percent in the second quarter to $50.7 million versus a very soft performance in the second quarter of last year. Sales grew 23 percent to $516.4 million.
 The profit gain was led by the domestic business which benefited from additional units, cost savings from the organizational restructuring announced at the end of last year, and improved volume. Double-digit international profit growth was led by gains in Australia and Canada.
 Same store sales for domestic company-owned units grew three percent in the quarter and one percent year-to-date.
 Taco Bell - Operating profits advanced 11 percent for the second quarter to $47.3 million on sales growth of 17 percent to $552.0 million. Profit and sales growth was driven by additional units and volume growth. Lower operating margins reflect the introduction of the Steak Burrito, a lower margin product, as well as investments in new concepts.
 Same store sales for domestic company-owned units grew three percent for the quarter and four percent year-to-date.
 Year-to-date
 For the first two quarters, earnings per share grew 20 percent to $0.78, net income advanced 19 percent to $624.5 million and sales grew 11 percent to $9.8 billion.
 PEPSICO, INC. AND SUBSIDIARIES
 Condensed Consolidated Statement of Income
 (in millions except per share amounts, unaudited)
 Percent
 12 Weeks Ended 6/13/92 6/15/91 Change
 Net Sales $5,210.8 $4,679.8 11
 Costs and Expenses:
 Cost of Sales 2,449.5 2,234.7 10
 Selling, general and
 administrative expenses 2,006.2 1,807.2 11
 Amortization of goodwill
 and other intangibles 57.1 47.0 21
 Interest expense 140.6 139.3 1
 Interest income (27.4) (38.1) (28)
 Total 4,626.0 4,190.1 10
 Income Before Income Taxes 584.8 489.7 19
 Provision for Income Taxes(a) 201.8 171.4 18
 Net Income $ 383.0 $ 318.3 20
 Net Income Per Share $ 0.48 $ 0.39 23
 Average shares outstanding 804.3 806.2
 NOTES:
 (a) The effective tax rates were 34.5 percent in 1992 and 35.0
 percent in 1991.
 PEPSICO, INC. AND SUBSIDIARIES
 Condensed Consolidated Statement of Income
 (in millions except per share amounts, unaudited)
 Percent
 24 Weeks Ended 6/13/92 6/15/91 Change
 Net Sales $9,787.5 $8,796.8 11
 Costs and Expenses:
 Cost of Sales 4,645.4 4,198.6 11
 Selling, general and
 administrative expenses 3,859.1 3,488.0 11
 Amortization of goodwill
 and other intangibles 108.5 92.4 17
 Interest expense 277.3 292.0 (5)
 Interest income (56.2) (79.9) (30)
 Total 8,834.1 7,991.1 11
 Income Before Income Taxes 953.4 805.7 18
 Provision for Income Taxes(a) 328.9 282.0 17
 Net Income $ 624.5 $ 523.7 19
 Net Income Per Share $ 0.78 $ 0.65 20
 Averacent in 1991.
 PEPSICO INC. AND SUBSIDIARIES
 Supplemental Schedule of Net Sales and Operating Profits
 12 Weeks Ended June 13, 1992 and June 15, 1991
 (in millions, unaudited)
 Net Sales Operating Profits
 12 Weeks 12 Weeks 12 Weeks 12 Weeks
 Ended Ended Percent Ended Ended Percent
 6/13/92 6/15/91 Change 6/13/92 6/15/91 Change
 Beverages
 -Dom $1,347.8 $1,282.1 5 $ 238.6 $ 214.6 11
 -Int'l 533.7 441.2 21 56.7 41.7 36
 1,881.5 1,723.3 9 295.3 256.3 15
 Snack Foods
 -Dom 953.2 902.5 6 191.5 158.2 21
 -Int'l 491.7 418.3 18 62.5 48.1 30
 1,444.9 1,320.8 9 254.0 206.3 23
 Restaurants
 -Dom 1,642.4 1,445.0 14 153.1 134.6 14
 -Int'l 242.0 190.7 27 24.9 20.2 23
 1,884.4 1,635.7 15 178.0 154.8 15
 Total
 -Dom 3,943.4 3,629.6 9 583.2 507.4 15
 -Int'l 1,267.4 1,050.2 21 144.1 110.0 31
 $5,210.8 $4,679.8 11 727.3 617.4 18
 Interest & Other Corporate
 Expenses, net (142.5) (127.7) 12
 Income Before Income Taxes $ 584.8 $ 489.7 19
 Results by Restaurant Chain:
 Pizza Hut $ 816.0 $ 744.8 10 $ 80.0 $ 78.4 2
 Taco Bell 552.0 471.4 17 47.3 42.5 11
 KFC 516.4 419.5 23 50.7 33.9 50
 $1,884.4 $1,635.7 15 $ 178.0 $ 154.8 15
 PEPSICO, INC. AND SUBSIDIARIES
 Supplemental Schedule of Net Sales and Operating Profits
 24 Weeks Ended June 13, 1992 and June 15, 1991
 (in millions, unaudited)
 Net Sales Operating Profits
 24 Weeks 24 Weeks 24 Weeks 24 Weeks
 Ended Ended Percent Ended Ended Percent
 6/13/92 6/15/91 Change 6/13/92 6/15/91 Change
 Beverages
 -Dom $2,491.5 $2,339.4 7 $ 383.9 $ 358.0 7
 -Int'l 926.9 785.8 18 68.3 59.4 15
 3,418.4 3,125.2 9 452.2 417.4 8
 Snack Foods
 -Dom 1,789.5 1,717.1 4 333.6 291.2 15
 -Int'l 952.9 824.1 16 125.5 90.5 39
 2,742.4 2,541.2 8 459.1 381.7 20
 Restaurants
 -Dom 3,153.0 2,756.1 14 258.2 234.4 10
 -Int'l 473.7 374.3 27 53.8 39.8 35
 3,626.7 3,130.4 16 312.0 274.2 14
 Total
 -Dom 7,434.0 6,812.6 9 975.7 883.6 10
 -Int'l 2,353.5 1,984.2 19 247.6 189.7 31
 $9,787.5 $8,796.8 11 1,223.3 1,073.3 14
 Interest & Other Corporate
 Expenses, net (269.9) (267.6) 1
 Income Before Income Taxes $ 953.4 $ 805.7 18
 Results by Restaurant Chain:
 Pizza Hut $1,608.1 $1,466.2 10 $ 152.5 $ 141.8 8
 Taco Bell 1,037.4 876.9 18 80.5 73.9 9
 KFC 981.2 787.3 25 79.0 58.5 35
 $3,626.7 $3,130.4 16 $ 312.0 $ 274.2 14
 PEPSICO, INC. AND SUBSIDIARIES
 Condensed Consolidated Balance Sheet
 (in millions, unaudited)
 6/13/92 12/28/91
 Assets
 Cash and cash equivalents $ 133.9 $ 186.7
 Short-term investments 1,987.8 1,849.3
 Other current assets 2,874.1 2,530.1
 Total Current Assets 4,995.8 4,566.1
 Investments in affiliates
 and other assets 1,948.7 1,681.9
 Property, plant and
 equipment, net 6,860.1 6,594.7
 Goodwill and other
 intangibles, net 6,157.6 5,932.4
 Total Assets $19,962.2 $18,775.1
 Liabilities and Shareholders' Equity
 Short-term borrowings $ 1,442.2 $ 228.2
 Other current liabilities 3,288.1 3,493.9
 Total Current Liabilities 4,730.3 3,722.1
 Long-term debt 7,444.2 7,806.2
 Other noncurrent liabilities 1,806.4 1,701.4
 Total Liabilities 13,980.9 13,229.7
 Shareholders' Equity 5,981.3 5,545.4
 Total Liabilities and
 Shareholders' Equity $19,962.2 $18,775.1
 -0- 7/21/92
 /CONTACT: Kenneth Ross of PepsiCo, Inc., 914-253-2725/
 (PEP) CO: PepsiCo ST: New York IN: FOD SU: ERN


TQ -- NY013 -- 1086 07/21/92 08:16 EDT
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