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Pepsi 4Q profit runs over
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February 9, 2000: 10:52 a.m. ET
Drink, snack maker beats estimates by 2 cents a share, unveils growth plans
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NEW YORK (CNNfn) - Robust growth in its North American operations fueled a better-than-anticipated fourth-quarter profit at PepsiCo, which also announced Wednesday an expansion of its Frito-Lay division intended to accelerate earnings even further.
The Purchase, N.Y.-based soft drink and snack foods company reported fourth-quarter operating earnings of $764 million, or 33 cents per share, easily surpassing the $639 million, or 26 cents per share, the company earned a year earlier.
The quarterly results also edged by the consensus analysts' estimate compiled by First Call Corp. of 31 cents per share.
Including one-time charges, PepsiCo earned $494 million in the period, up from $391 million a year earlier.
The company attributed the earnings growth to strong North American results, particularly in its soft drink division, where a sharp decline in advertising and marketing costs -- aided by the fourth-quarter 1998 launch of Pepsi One -- resulted in a 23 percent increase in operating profit.
Overall revenue for the quarter jumped 6.2 percent to $5.68 billion, driven mainly by sharp gains at both the Frito-Lay and Tropicana divisions.
For the year, PepsiCo earning rose to $2.8 billion, or $1.24 per share, from $2.57 billion, or $1.10 per share, the previous year. Revenue climbed 6 percent to $18.67 billion for the full year.
Separately, PepsiCo (PEP: Research, Estimates) said it will expand its Frito-Lay operations by adding two divisions, one focusing on Europe, the Middle East and Africa and another concentrating on Latin America, Asia Pacific and Australia.
Company officials said the expansion is intended to capture an even greater share of the $16 billion international salty snack food market. The Frito-Lay division currently accounts for roughly 63 percent of PepsiCo's overall sales, and its revenue has climbed nearly 40 percent in the last four years.
In conjunction with that expansion, the company said current Frito-Lay International President James O'Neal, 62, will retire April 1.
Rogelio Rebolledo, 55, who is credited with guiding Frito-Lay's expansion through Mexico and Latin America, will assume control of the Latin America/Asia Pacific/Australia operation, while Michael White, 48, will become president and chief executive of the Europe/Middle East/Africa division.
PepsiCo (PEP: Research, Estimates) shares were up 1-1/3/16 at 35-1/8 Tuesday morning. 
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PepsiCo
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