PURCHASE, N.Y. — Productivity initiatives weighed on operating income in the PepsiCo Americas Foods unit of PepsiCo, Inc. in the second quarter ended June 16. At $1,260 million, operating profit for PepsiCo Americas Foods in the quarter was down 3% from $1,294 million in the same period a year ago. Net revenue in the division increased 4%, rising to $5,724 million from $5,481 million.
Frito-Lay North America, the largest segment within PepsiCo Americas Foods, suffered a 2% decline in operating profit during the second quarter to $835 million. Net revenue, meanwhile, rose 3% to $3,193 million from $3,090 million.
Second-quarter operating profit at Quaker Foods North America fell 8% to $154 million from $167 million. Net revenue was flat at $583 million.
Latin America Foods operating profit was $271 million in the second quarter of fiscal 2012, down 1% from $274 million. Net sales rose 8% to $1,948 million from $1,808 million.
Overall, net income at PepsiCo, Inc. in the second quarter ended June 16 totaled $1,488 million, equal to 94c per share on the common stock, down 21% from $1,885 million, or $1.17 per share, in the same period a year ago. Net revenue was $16,458 million, down 2% from $16,827 million. For the first six months of fiscal 2012, net income was $2,615 million, or $1.65 per share, down 14% from $3,028 million, or $1.89c per share, in the same period a year ago. Net revenue was $28,886 million, up narrowly from $28,764 million.
“PepsiCo is diligently executing the strategy we set forth at the start of the year, and we remain on track to achieve our full-year targets,” said Indra Nooyi, chairman and chief executive officer. “We were able to achieve significant pricing in the second quarter, reflecting the strength of our brand portfolio and the success of our packaging initiatives. Our disciplined approach to pricing and continued focus on brand investment drove 5% organic net revenue growth and allowed us to substantially offset approximately $350 million in commodity cost inflation.
“Our focus for the second half of the year is squarely on executing against our strategic priorities. We will continue to step up our brand support through increased advertising and marketing, accelerate our innovation to drive growth, and drive our aggressive productivity agenda.
“The work we are doing will enhance our competitiveness while positioning PepsiCo for sustainable growth and value creation for the long term.”
PepsiCo said it expects to return more than $6 billion to shareholders through dividends and share repurchases, and to deliver more than $1 billion in productivity savings in 2012.