NEW YORK: PepsiCo. Inc. has reported a better-than-expected profit for the second quarter, buoyed by lower raw material costs and higher demand for Frito-Lay snacks and new beverages in North America.
PepsiCo’s shares rose 1.3 percent to $107.35 in premarket trading, setting up shares of the maker of Pepsi, Gatorade and Tropicana to scale a record high in regular trading. Pepsi also boosted its forecast for adjusted profit for the year.
New drinks such as Propel flavored water and Naked Cold Pressed juice, Smartfood Popcorn and snacks under its “Simply” brand helped drive sales, the company said.
PepsiCo. and other food companies are spending more to develop new products to meet the changing tastes of consumers who are increasingly seeking healthier drink and snack options.
“The North American strength is a big driver behind raising guidance for the year because North America really is performing strongly right now,” Hugh Johnston, PepsiCo’s chief financial officer told Reuters.
Pepsi has doubled its research and development spending over the last 5 years and new products now account for 9 percent of PepsiCo’s revenue, up from 5 percent in past years, Johnston said.
PepsiCo’s cost of sales fell 6 percent in the three months ended June 11.
That helped net income attributable to PepsiCo. increase 1.3 percent to $2.01 billion, or $1.38 a share.
Excluding items, the company earned $1.35 per share, beating the average analyst estimate of $1.30, according to Thomson Reuters I/B/E/S.
Net revenue fell 3.3 percent to $15.395 billion, but inched past the average analyst estimate of $15.37 billion.
Net revenue in the North America Beverages unit, PepsiCo’s biggest business, rose 1 percent — the slowest growth since the company started breaking out beverage sales from the region a year ago.
Revenue from the Frito-Lay business, which includes Doritos, Lay’s and the Simply line of snacks, rose 3 percent. New snacks launched under the Simply brand included Simply Tostitos black bean chips and organic chunky medium salsa.
PepsiCo. said it now expects 2016 adjusted earnings of $4.71 per share, up from its previous forecast of $4.66 per share.
PepsiCo earnings beat expectations
PepsiCo earnings beat expectations
Saudi Arabia’s cultural sector is a new economic engine between Riyadh and Paris, says ambassador
RIYADH: Culture has become a fundamental pillar in bilateral relations between France and Saudi Arabia, according to the French Ambassador to the Kingdom, Patrick Maisonnave.
Maisonnave noted its connection to the entertainment and tourism sectors, which makes it a new engine for economic cooperation between Riyadh and Paris.
He told Al-Eqtisadiah during the opening ceremony of La Fabrique in the Jax district of Diriyah that cultural cooperation with Saudi Arabia is an important element for its attractiveness in the coming decades.
La Fabrique is a space dedicated to artistic creativity and cultural exchange, launched as part of a partnership between the Riyadh Art program and the French Institute in Riyadh.
Running from Jan. 22 until Feb 14, the initiative will provide an open workspace that allows artists to develop and work on their ideas within a collaborative framework.
Launching La Fabrique as a space dedicated to artistic creativity
The ambassador highlighted that the transformation journey in the Kingdom under Vision 2030 has contributed to the emergence of a new generation of young artists and creators, alongside a growing desire in Saudi society to connect with culture and to embrace what is happening globally.
He affirmed that the relationship between the two countries is “profound, even cultural par excellence,” with interest from the Saudi side in French culture, matched by increasing interest from the French public and cultural institutions unfolding in the Kingdom.
Latest estimates indicate that the culture-based economy represents about 2.3 percent of France’s gross domestic product, equivalent to more than 90 billion euros ($106.4 billion) in annual revenues, according to government data. The sector directly employs more than 600,000 people, making it one of the largest job-creating sectors in the fields of creativity, publishing, cinema, and visual arts.
Saudi Arabia benefiting from French experience in the cultural field
Maisonnave explained that France possesses established cultural institutions, while Saudi Arabia is building a strong cultural sector, which opens the door for cooperation opportunities.
This comes as an extension of the signing of 10 major cultural agreements a year ago between French and Saudi institutions, aiming to enhance cooperation and transfer French expertise and knowledge to contribute to the development of the cultural system in the Kingdom.
He added that experiences like La Fabrique provide an opportunity to meet the new generation of Saudi creators, who have expressed interest in connecting with French institutions and artists in Paris and France.
La Fabrique encompasses a space for multiple contemporary artistic practices, including performance arts, digital and interactive arts, photography, music, and cinema, while providing the public with an opportunity to witness the stages of producing artistic works and interact with the creative process.
