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PepsiCo's earnings tumble
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February 4, 1997: 5:09 p.m. ET
Beverage giant reports lower income for 4Q and year as a whole
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NEW YORK (CNNfn) - PepsiCo Inc., citing weaker sales at its international beverages and domestic fast-food units, reported lower earnings Tuesday for both the fourth quarter and 1996 as a whole.
For the quarter, PepsiCo earnings fell to $28 million, or 3 cents a share, from $181 million, or 11 cents a share, in the same 1995 period.
For the year, PepsiCo's profits declined to $1.1 billion, or 72 cents a share, from $1.6 billion, or $1 a share, in 1995.
"Our goal is to produce consistent earnings growth of about 15 percent a year, (but) despite remarkably strong performances by many of our businesses, we fell well short of that in 1996," PepsiCo Chairman Roger Enrico said in releasing the results.
Enrico said PepsiCo's North American beverage and global snack units, international restaurants and Kentucky Fried Chicken chain all made money in 1996.
But PepsiCo reported a slowdown at its international beverage unit, coupled with lower profits at the company's Pizza Hut and Taco Bell chains.
PepsiCo noted that it has already taken steps to address those problems.
For instance, the company has restructured its international beverage unit, while also putting new executives in charge of Pizza Hut and Taco Bell.
At the same time, the company has previously announced plans to spin off its restaurant businesses altogether, as well as to consider selling off a $3 billion restaurant-supply unit.
"Together, these actions will dramatically sharpen our focus as a corporation, position us for strong consistent growth and, ultimately, help us to create a bigger, more profitable future for PepsiCo and its shareholders," Enrico said.
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