PepsiCo snacks fare well, but far behind diet drinks

The US food and beverage giant reported a 13 per cent net sales growth in its third quarter, with a worldwide snacks volume increase of 4.5 per cent, compared to a 10 per cent volume increase in its beverage division. Snack sales were headed by strong double-digit growth on revenues from the firm's Quaker Chewy Granola bars and rice cake products, while its cookie, cracker and meat snack lines also reported a strong performance. Quaker Foods North America had a 2 per cent net revenue increase, driven by growth of Rice-A-Roni and Life cereal. The company said these gains were offset by "declines in other breakfast foods." Crisp and snack brand Frito-Lay reported a 6 per cent net revenue increase, headed by its Lay potato chip products, Cheetos cheese flavoured snack products, Tostito tortilla chips and Sunchips multigrain snacks. In contrast, the company's trademark Doritos saw a slight decline. Emerging markets in Russia and China as well as the Middle East and South America also recorded strong growth in both snacks and beverages. Elsewhere the company continued to enjoy a strong performance of its energy, diet and non-carbonated drinks, leaving carbonated drinks lagging behind, with Pepsi's traditional fizzy cola drink suffering low single-digit declines. PepsiCo's net sales rose by $2bn in the first nine months of its fiscal 2005 to $22.46bn (£12.7bn, €18.7bn). PepsiCo's net profits dropped from $3.2bn to $2.97bn, due to significantly higher income tax charges borne out of the group's repatriation of $7.5bn, so as to comply with the new American Jobs Creation Act. External links to companies or organisations mentioned in thisstory: PepsiCo