US News
PepsiCo Withdraws Financial Outlook for Fiscal 2020; Prepares for “Ups and Downs”
PepsiCo Inc. recently reported that it had net income of $1.338 billion, or 96 cents a share, in its fiscal first quarter to March 21st. This figure is down from $1.413 billion, or $1 a share, in the year-earlier period, as reported by Fox Business. Revenue rose to $13.881 billion from $12.884 billion.
“Despite a strong first quarter, there is still a great deal of uncertainty that exists in relation to COVID-19, including how geographies, retail channels and consumer behaviors will evolve over time,” the company said. “Due to this uncertainty, the company's previous financial outlook regarding fiscal year 2020 is no longer applicable.”
PepsiCo: Its Ups and Downs
Pepsi CEO predicts a second wave of coronavirus cases, warning against forecasts of linear recovery as states and countries reopen https://t.co/MZR2Phdms0
— Business Insider (@BusinessInsider) April 28, 2020
Business Insider reported that the company is preparing for “ups and downs” as states and countries reopen. PepsiCo is essentially giving a warning against assumptions that economic recovery will be linear.
“We don't think it's going to be a straight line once people go back to moving around … with potential second waves in some particular markets,” said PepsiCo CEO Ramon Laguarta.
The company reported that organic revenue grew 7.9% in the first quarter. Lagurata says sales of multi-packs and variety packs of snacks are rising as people seek “moments of enjoyment during this confinement.”
Meanwhile, the crisis is also “cutting into PepsiCo's beverage sales in gas stations and convenience stores, as well as business at restaurants that serve Pepsi products,” reported Business Insider.
“The chances of every country opening up and every state opening up and not having second waves, I think, are low,” Laguarta said. “We don't have treatments and we don't have vaccines. So until we have treatments and we have vaccines, we should be very cautious.”
Laguarta explains that the company plans to be “extremely aggressive” as regions reopen. “We want to be first knocking on the door” when stores open, Laguarta said.
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