Quarterly reports from two food industry giants reflect their relative exposure to the pandemic – and how the pandemic’s development affects their performance.
PepsiCo saw revenue for the most recent quarter rise 5.3%, which company executives attributed to the partial lifting of pandemic restrictions. That increased traffic to convenience stores and gas stations, which are major channels for beverage sales. PepsiCo’s beverage division posted a 6% increase in revenue for the quarter over last year, reversing a 7% decline in the previous quarter. This happened even though foodservice, another major channel for beverage sales, is still under pandemic restrictions.
“Mobility has clearly risen,” CFO Hugh Johnston told the Wall Street Journal.
Revenue for PepsiCo’s Frito-Lay and Quaker Foods divisions were up 7% and 6% respectively, which the company attributes to consumers eating in more.
McCormick & Co. also benefited from the eat-at-home trend, with a 7.6% year-over-year increase in revenue for the quarter ending Aug. 31. It increased its estimated revenue increase for the full fiscal year, which ends in November, at 4% to 5% above last year. Sales for the consumer segment rose 14.7%.
Company executives attributed the increase to the eat-at-home trend, and said they expect the surge in home cooking to carry over past the pandemic. “Consumers haven’t been doing anything that is contrary to what they have been trending to do already. They’re just doing more of it,” CEO Lawrence Kurzius told the Journal.
Revenue for McCormick’s flavor solutions division, which supplies foodservice and industrial operations, went down 2.9%.
