PepsiCo Inc. said Wednesday fourth-quarter profit rose as strong sales of salty snacks and Gatorade sports drinks and Aquafina water offset the impact of increasing energy and raw material costs.
Like many food companies, PepsiCo, whose products range from Pepsi Cola to Frito-Lay snacks and Quaker cereals, has been hit by higher prices for energy and packaging.
The world's No. 2 soft drink company said earnings increased to $1.1 billion, or 65 cents a share, from $985 million, or 58 cents a share, a year earlier.
PepsiCo said the 2005 quarter included pretax charges totaling $83 million related to previously announced restructuring actions to reduce costs at some operations. That charge offset a benefit of 3 cents from the extra week in 2005.
Revenue rose to $10 billion from $8.8 billion.
Analysts, on average, expected earnings of 65 cents a share on revenue of $9.5 billion, according to Reuters Estimates.
Frito-Lay North America, the company's largest division, booked $3.2 billion in revenue.
On Tuesday, Coca-Cola Co. , the world's biggest soft-drink maker, reported a drop in fourth-quarter profit on higher marketing costs and charges to repatriate foreign earnings. Excluding one-time items, earnings beat the analysts' average forecast, helped by higher-than-expected revenue.
So far in 2006, PepsiCo's stock has fallen 3.8 percent and trades at 19.3 times expected 2006 earnings, while Coke shares have risen 1.8 percent with a price-to-earnings ratio of 18.