PepsiCo Inc on Wednesday reported a higher-than-expected quarterly profit, helped by increased sales at its Frito-Lay snack business, and said it would buy back up to $12 billion in stock by 2018.
The company also raised its annual dividend by 7.3 percent to $2.81 per share and said it expected to return $8.5 billion to $9 billion to shareholders through payouts and buybacks this year.
Sales in Pepsi’s North American snack business rose 3 percent in the fourth quarter. The business has been a bright spot for the company, helping its stock vastly outperform that of larger rival Coca-Cola Co (KO.N) in the past year.
Sales in Pepsi’s beverage business, which has been hurt by a long-term decline in soft drink sales in the United States, rose 1 percent, helped by an increase in overall prices and sales of non-carbonated drinks in North America.
Fourth-quarter net revenue fell about 1 percent to $19.95 billion as the stronger dollar reduced the value of overseas sales, but the results exceeded the analysts’ average estimate of $19.66 billion, according to Thomson Reuters I/B/E/S.
Net income attributable to the company fell to $1.31 billion, or 87 cents per share, from $1.74 billion, or $1.12 per share.
Excluding items such as restructuring charges, earnings were $1.12 per share. Analysts were expecting $1.08.