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PepsiCo Announces a $7 Billion Dividend and Buyback Plan

February 11, 2016, 12:47 PM UTC
PepsiCo Marks 50th Anniversary At New York Stock Exchange
NEW YORK, NY - JUNE 08: Indra K. Nooyi, Chairman and Chief Executive Officer of PepsiCo., rings the Opening Bell with other executives at the New York Stock Exchange on June 8, 2015 in New York City. The event was in celebration of the June 8, 1965 merger between Pepsi-Cola and Frito-Lay. The market was down 50 points in afternoon trading. (Photo by Spencer Platt/Getty Images)
Photo by Spencer Platt—Getty Images

PepsiCo reported better-than-expected quarterly net revenue, as higher sales of snacks and beverages in North America helped reduce the impact of a strong dollar.

The company increased its annualized dividend to $3.01 per share from $2.81 per share and said it would return about $7 billion to shareholders through dividends and buybacks in 2016.

Revenue from PepsiCo‘s (PEP) North America beverages business, which the company started breaking out from the third quarter, rose 2% in the fourth quarter ended Dec. 26, accounting for 31.5% of total revenue.

Revenue from its snacks business, which includes Frito-lay and Doritos chips, also increased 2% in the region.

Frito-Lay North America and North America Beverages were the only two businesses to report revenue growth in the quarter.

The average value of the dollar against a basket of currencies rose 11.7% in the fourth quarter compared with the same quarter a year earlier.

The net income attributable to the company rose to $1.72 billion, or $1.17 per share, in the fourth quarter, from $1.31 billion, or 87 cents per share, a year earlier.

Excluding items, the company earned $1.06 per share.

Net revenue fell 7% to $18.59 billion.

Analysts on average had expected earnings of $1.06 per share on net revenue of $18.51 billion, according to Thomson Reuters I/B/E/S.