PepsiCo Beats Expectations, Profits Fall Joe Raedle/Getty Images

PepsiCo Beats Expectations, Profits Fall

Pepsi said it would increase the dividend to 7.3% and also laid out a plan to spend as much as $9 billion on stock buybacks and dividends for 2015.

PepsiCo (IW 500/18) released its earnings report Wednesday, detailing a decline in revenue, but still coming in above Wall Street estimates on strong sales of its snack foods.

The company reported revenue of $19.95 billion, down 1% year over year. Profits were $1.31 billion, a drop from $1.74 billion in 2013. Unfavorable foreign exchange rates are blamed for knocking down revenue by six percentage points.

The Frito-Lay division helped prop up sagging sales of carbonated soft drinks and other food entities. Revenue at Frito-Lay North America grew 3%, helping offset a drop in revenue at Quaker of 3% in the U.S. and 10% in Europe.

Pepsi said it would increase the annual dividend to 7.3% and also laid out a plan to spend as much as $9 billion on stock buybacks and dividends for 2015.

At the same time, it predicted a cut in revenue and per-share earnings for the upcoming year based on the devaluation of foreign currency.

On Tuesday, rival Coca-Cola reported a profit loss of 55%, blaming it on the low exchange rate for foreign money and one-time charges.

Both companies predict a challenging year ahead in 2015.

 

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