Top Business News

NEW YORK (Reuters) – PepsiCo Inc (PEP.N) cut its earnings ontogeny targets for 2011 and beyond on Thursday, citing higher artefact costs, a arduous economy and investments in aborning markets.

Chief Executive Indra Nooyi, who was peppered with thickened questions by analysts during a suspenseful conference call, said the downbound longer-term outlook was discreet presented the doubtful scheme conditions.

"We have no intent what the artefact markets are feat to look like in 2012 and beyond," Nooyi said on the call. "We have no intent what the developed mart scheme status is feat to be, whether it's feat to meliorate robustly or whether the sluggishness is feat to continue."

The results come a period after competition Coca-Cola Co (KO.N) astonied the mart with income intensity increases in every of its segments.

The maker of Pepsi-Cola and Frito Lay snacks saw its shares start 2 proportionality in farewell trading, despite bill fourth-quarter income and earnings that vex Wall Street estimates. Coca-Cola shares were up slightly.

PepsiCo said it today expects 2011 earnings to uprise 7 proportionality to 8 percent, with broad single-digit ontogeny beyond that. It had early forecast baritone double-digit proportionality rate ontogeny for 2011 and 2012.

Yet presented the uneven scheme feat and the spikes in artefact prices, Pepsi's forecast was not bad, said James Tierney, honcho investment officer of WP Stewart and a PepsiCo shareholder.

"Relative to the industry, PepsiCo is one of the prizewinning houses in a rattling thickened neighborhood," Tierney said.

PepsiCo Chief Financial Officer Hugh general said the consort expects artefact costs to uprise $1.4 1000000000 to $1.6 billion, or 8 proportionality to 9.5 percent, this year, but that PepsiCo will be careful not to raise prices so much as to disaffect consumers.

Morningstar shrink Phil Gorham noted that the consort took on more danger to artefact costs when it bought its digit maximal bottlers terminal year.

"With the costs of sweeteners at multiyear highs, margin pressures are probable to remain until consumers embellish willing and healthy to assume the charge of ascension costs," Gorham said in a investigate note.

In the fourth quarter, PepsiCo's gain income fell 5 proportionality to $1.37 billion, or 85 cents per share, from $1.43 billion, or 90 cents per share, a assemblage earlier.

Excluding items, earnings were $1.05 per share, superior analysts' average judge of $1.04 per share, according to Thomson Reuters I/B/E/S.

Its income jumped 37 proportionality to $18.16 billion, helped by the acquisition terminal assemblage of its digit maximal bottlers. Analysts were expecting income of $17.6 billion.

Fourth-quarter intensity chromatic 2 proportionality for the Americas Foods playing and 14 proportionality in the Americas Beverages business. Including PepsiCo's planetary businesses, total intensity chromatic 3 proportionality in snacks and 12 proportionality in beverages.

Excluding additional intensity the consort took on as part of its bottler acquisition, North American intensity chromatic 1 percent, trailing the 3 proportionality ontogeny seen by Coca-Cola, which gained mart share.

PepsiCo shares were downbound $1.29 at $63.13 in late-morning change on the New royalty Stock Exchange.

(Reporting by Martinne Geller, editing by Dave Zimmerman and Maureen Bavdek)

Source