PepsiCo reports 'double-digit organic revenue growth' in March qtr in India

Global food and beverages major PepsiCo on Tuesday said its Indian unit delivered a "double-digit organic revenue growth" in the first quarter of 2023.

It has reported a double-digit growth in the beverage unit volume in the Indian market, PepsiCo said in its global earnings statement.

However, in the convenient foods, unit volume experienced a low-single-digit decline in the Indian market in the quarter ended on March 31, 2023.

PepsiCo's net revenue in Africa, Middle East, South Asia (AMESA) division, including India, was up 1.49 per cent to USD 1.01 billion as against USD 1 billion, primarily reflecting effective net pricing, partially offset by an organic volume decline.

However, its gross profit in the March quarter was down 6.6 per cent to USD 168 million on account of the impact of higher commodity costs, primarily cooking oil and packaging materials, certain operating cost increases, higher advertising and marketing expenses.

"Each of our international divisions reported a strong organic revenue growth, led by AMESA, which delivered double-digit organic revenue growth in both beverages and convenient foods during the quarter with India, Egypt, Saudi Arabia and Pakistan each delivering double-digit organic revenue growth and South Africa delivering high-single-digit organic revenue growth," it said.

PepsiCo owns popular brands such as Lay's, Doritos, Cheetos, Gatorade, Pepsi-Cola, Mountain Dew and Quaker.

During the (March) quarter, in AMESA zone, PepsiCo "beverage unit volume grew 15 per cent, primarily reflecting double-digit growth in India, partially offset by a low-single-digit decline in Nigeria," it said.

While Convenient Foods unit volume declined 8 per cent in AMESA, reflecting a double-digit decline in South Africa, partially offset by double-digit growth in the Middle East.

"Additionally, India and Pakistan each experienced a low-single-digit decline," it said.

PepsiCo's net revenue for the first quarter was at USD 17.85 billion, up 10.2 per cent.

The company's Chairman and CEO Ramon Laguarta said he was very pleased with the performance for the first quarter as the business delivered a 14.3 per cent organic revenue growth and an 18 per cent core constant currency earnings per share growth.

PepsiCo has now lifted the projections for 2023.

"Given the strength of our business performance, we now expect our full-year 2023 organic revenue to increase 8 per cent (previously 6 per cent) and our core constant currency earnings per share to increase 9 per cent (previously 8 per cent)," it said.