PepsiCo expects to raise prices again early next year
By Shubhangi on Oct 06, 2021 | 05:36 AM IST
Key Points:
·
Due to supply-chain challenges, PepsiCo
might have to hike prices again next year.
·
PepsiCo had recently raised prices
due to rising raw material prices.
PepsiCo Inc
said on Tuesday it is expecting to raise prices of snacks and beverages again
early next year due to supply-chain challenges.
Chief
Financial Officer Hugh Johnston said the company faced shortage of cans and
Gatorade bottles in the last few months as restaurants and theatres reopened
recently.
"I do expect there will probably be some price increases
in the first quarter of next year as well, as we fully absorb and lock down the
impact of commodity inflation," Johnston said.
Supply-chain disruptions are likely to moderate by the end
of 2021, he added.
Earlier price hike
In recent weeks, PepsiCo has already raised prices of its
sodas and snacks blaming the rising raw material prices. In the U.K., PepsiCo
business is also suffering due to shortage of truck drivers in post-Britain.
Johnston,
though, has assured that there will be no shortage of PepsiCo products and said
the company will be performing better by the end of the fourth quarter.
Company’s Performance
PepsiCo
expects organic revenue to rise about 8% in fiscal 2021, compared to the
forecast of 6% rise, the company said.
The
third-quarter organic revenue of the company rose 9%, while the costs were up
over 10% due to higher spending on distribution and marketing.
Net revenue
increased 11.6% to $20.19 billion in the quarter, compared to estimates of
$19.39.
Shares of
the company rose marginally in premarket trading.
Picture
Credits: Reuters