PepsiCo is ‘largest contributor to food and beverage growth’ in US retail in Q3, says outgoing CEO

The US food giant posted a 1.5% net revenue growth and 4.9% organic revenue growth to reach $16.49bn, during the quarter, with gross profit growing at 1% year-over-year.

Frito-Lay’s ‘solid performance’

Nooyi said PepsiCo’s solid performed in Q3 was driven by its international Frito-Lay in North America, the latter registering a 3% growth to reach $3.89bn.

She contributed Frito-Lay North America’s success to innovation and brand marketing.

“In June, we launched Stacy’s Cheese Petites inspired by French cheese puffs, [which] have real cheese inside creating a sophisticated snacking experience,”​ said Nooyi.

“Tostito’s growth was fueled by new products such as Roasted Red Pepper and Black Bean and Garlic [and] Cheetos further benefited from our Cheetos Museum Win What You See campaign.”​

Quaker Foods gaining share

Quaker Foods, PepsiCo’s cereal business in North America, posted a 2% revenue decline in the quarter to reach $567m.

However, Nooyi noted the unit gained market shares for its fifth consecutive quarter supported by the company’s marketing campaign to highlight the functional benefits of products, such as Simple and Wholesome Organic Hot Cereal.

“Quaker light snacks gained market share with high single digit retail sales growth. [Additionally], our Aunt Jemima pancake business grew retail sales for the eight consecutive quarter,”​ she added.

International markets

Nooyi said PepsiCo was “extremely pleased”​ with the 10% growth in sales in its international markets in Q3.

Revenue in Latin America grew 10% driven by high single-digit growth in Mexico and double-digit growth in Argentina, Brazil and Colombia.

Its Europe, sub-Saharan Africa, Russia and South Africa sectors also grew with high single-digits, while Turkey and Poland reported double-digit growth.

“We also had strong double-digit organic revenue growth in China, Saudi Arabia, India and Egypt, and high single-digit organic revenue growth in Australia,”​ Nooyi said, adding that PepsiCo is expanding both Doritos and Quaker internationally.

PepsiCo updated its guidance for full-year 2018 and predicted at least 3% organic revenue growth.