Diet Pepsi bottles in a store in the US

Source: PepsiCo

Indra Nooyi is handing the reins to 22-year Pepsico veteran Ramon Laguarta

Pepsico beat earning expectations as its beverage sales returned to growth, in Indra Nooyi’s final quarter in charge.

Nooyi, who is due to bow down as chief executive this week, led the global consumer giant to improved organic sales growth in the quarter to 8 September 2018.

Organic sales jumped 4.9%, ahead of the 3.4% average for the year to date, and the supplier upped its organic growth forecasts as a result.

However, the strengthening of the dollar prompted the US food and beverage to cut its full-year earnings per share target, and pressed down on net revenue growth.

Net revenue growth slowed 1.5% year-on-year for the period as it faced a 2pp headwind due to currency inflation.

Pepsico shares have slumped 1.2% to $109.4 in today’s trading following the trading update.

In its Europe and Sub-Saharan Africa area, Pepsico saw operating profit increase 3%, as it was impacted by cost increases and larger marketing expenditure.

Nooyi grew the supplier in snacking and healthier beverages as consumers turned away from fizzy drinks.

The strategy was most recently highlighted with the $3.2bn acquisition of home sparkling water dispenser brand SodaStream last month.

She is handing the reins to 22-year company veteran Ramon Laguarta and will remain as chairman until next year.

“We are pleased with our results for the third quarter,” commented Nooyi.

“We continued to see very strong operating performance from our international divisions, propelled by developing and emerging markets; Frito-Lay North America generated solid net revenue and operating profit growth; and North America Beverages delivered another quarter of sequential improvement in top-line performance.

“On the strength of our year-to-date results, we have revised upward our full-year organic revenue growth target.