Pepsi posts better profit

 
City A.M. Reporter
PEPSICO is planning to raise prices on some drinks and snacks in the coming weeks to help offset higher commodity costs.

The maker of <a href="http://www.pepsi.co.uk/"; target="_blank">Pepsi-Cola</a> reported slightly better than expected third-quarter earnings last night, sending shares up four per cent.

The US firm reported net income of $2bn (£1.27bn) compared with $1.92bn a year earlier.

Revenue climbed to $17.58bn, up from $15.51bn a year ago and slightly ahead of average analyst forecasts.

Price hikes, on top of other increases taken earlier this year, are helping the company stand by its full-year earnings growth target. PepsiCo expects 2011 earnings to grow at a high single-digit rate.

But due to a recent strengthening of the dollar, that forecast now only includes a one percentage point boost from foreign exchange, having earlier expected a two-point boost. The firm said it was too early to give an outlook for 2012, given current volatility.

PepsiCo also denied rumours on Wall Street that it was planning to split its drinks and snacks divisions.