PepsiCo Inc., the soft drink and snack foods maker, said Thursday its third-quarter profit dropped because of a charge related to taxes on its earnings overseas. Its operating earnings without the charges beat Wall Street’s estimate, however.
The Purchase, N.Y.-based maker of Pepsi and Mountain Dew and Frito-Lay snacks said its earned $864 million, or 51 cents a share, in the three months ended Sept. 3, down from $1.36 billion, or 79 cents a share, a year ago. Revenue rose to $8.18 billion from $7.26 billion a year ago.
Its earnings included a charge of 27 cents a share related to the company’s decision to repatriate $7.5 billion of international earnings under the provisions of the American Jobs Creation Act. Under that law, PepsiCo gets a greatly reduced tax rate on the earnings.
Excluding the tax items, its earnings rose to 78 cents a share, helped by sales of snacks and beverages overseas and in the U.S. Analysts polled by Thomson Financial expected earnings of 73 cents a share.
