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Pepsi (PEP) Reports In-Line Q4 EPS; Boosts Dividend

February 11, 2016 6:35 AM

Pepsi (NYSE: PEP) reported Q4 EPS of $1.06, in-line with the analyst estimate of $1.06. Revenue for the quarter came in at $18.59 billion versus the consensus estimate of $18.51 billion.

The Company expects 2016 core earnings per share of $4.66, versus the consensus of $4.76.

The Company also announced a 7.1 percent increase in its annualized dividend to $3.01 per share from $2.81 per share, effective with the dividend expected to be paid in June 2016. Total dividends to shareholders are expected to be approximately $4 billion in 2016. In addition, the Company anticipates share repurchases of approximately $3 billion, resulting in expected total cash returned to shareholders of approximately $7 billion in 2016.

"We are happy to report that we met or exceeded every financial goal we set for 2015, demonstrating consistent performance in the face of volatile macros," said Chairman and CEO Indra Nooyi.

"Our portfolio has been strategically designed to weather the current macroeconomic challenges. Our results reflect the balance of our brand portfolio, geographic footprint, consistent marketplace execution and a relentless focus on productivity. While facing the challenges of a choppy macro environment, we continued to make thoughtful investments in our future. By making investments in our brands, product innovation and supply chain, we have fortified our business for sustained growth. Notably, we increased advertising and marketing expense as a percentage of sales by 40 basis points for the full year and 85 basis points in the fourth quarter.

"Our financial performance translated into strong cash generation, enabling us to continue to provide attractive cash returns to our shareholders. In 2015 we returned more than $9 billion to shareholders in the form of dividends and share repurchases, bringing our cumulative 10-year shareholder cash returns to more than $65 billion.

"Looking ahead to 2016, we expect solid financial performance despite expected continued macroeconomic challenges, particularly in certain key developing and emerging markets. Returning cash to shareholders remains a top priority. We are increasing our dividend per share for the 44th consecutive year, beginning with our June 2016 payment, and we expect to return approximately $7 billion to shareholders through a combination of dividends and share repurchases."

For earnings history and earnings-related data on Pepsi (PEP) click here.

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