PepsiCo Inc has reported quarterly sales and profit that was better than had been expected. The soft drink beverage maker raised its forecast for adjusted earnings for the year as its higher prices have helped drive its revenue growth in the beverage business for the second time in close to four years.
The shares at PepsiCo were up 3% in trading just after the bell on Thursday. PepsiCo like other makers of soft drinks has been battling dropping sales in soda in the U.S. with customers opting for drinks that are healthier and more ingredients that are natural.
However, revenue from the Americas for the beverage business, its largest, was up 1% to more than $5.34 billion during the second quarter, as the strategy of increasing prices to offset the strong dollar impact has paid off.
On Wednesday, the company announced that it would report its results for its beverage business in North America separate from the third quarter rather than clubbing it with beverage sales from Latin America.
North American snack sales at Frito-Lay the second largest PepsiCo business were up 2% to $3.45 billion during the second quarter. The business has snacks such as Cheetos and Doritos chips.
The company increased its forecast for 2015 per share adjusted earnings growth from 7% to 8%, which is an increase of approximately $5 a share.
Net income that is attributable to PepsiCo increased marginally to just over $1.98 billion equal to $1.33 a share during the second quarter that ended on June 13 from its $1.98 billion equal to $1.29 a share for the same period last year.
Excluding special items, the company enjoyed earnings of $1.32 a share. Net income was down by 5.7% to end the quarter at $15.91 billion as the stronger U.S. dollar continued weighing on sales overseas.
Analysts were expecting earnings to reach $1.24 a share with revenue coming in at $15.8 billion.