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Pepsi Earnings Explained For 17-Year-Old Hedge Fund Managers
Be prepared for the next great transfer of wealth. Buy physical silver and storable food.
zerohedge.com / by Tyler Durden on 04/18/2016 – 09:15
In addition to the 53% plunge in Morgan Stanley earnings driven by a collapse in FICC revenues which plunged 55% from $1.9BN to $873MM, the other major company to report earlier today was Pepsi which, if only uses GAAP data, had more disappointing numbers: total revenues declined by 3% from $12.2BN to $11.86BN, just missing expectations of $11.87BN.
GAAP earnings tumbled by 24% from $1.2BN to $931MM, although since PEP repurchased $619MM in shares in the quarter, GAAP EPS declined a little less, or 21%, from $0.81 to $0.64.
A big reason for this slowdown was China, where Pepsi admitted the “consumer environment has slowed down somewhat“.
As the company’s CFO Hugh Johnston said in an interview, China played a big role in the 24% drop in PepsiCo’s (PEP) 1Q unadjusted net profit to $931M, with the company recording a $373M impairment charge in its 5% equity interest in Chinese beverage JV Tingyi-Asahi Beverages. “The consumer environment has slowed down somewhat there” and while it had some comforting words saying that the company is “continuing to do reasonably well”, it “still has work to do.”
But so much about GAAP: after all, investors only care about “real” earnings when the company is suffering and the financial reports are actually read.
The post Pepsi Earnings Explained For 17-Year-Old Hedge Fund Managers appeared first on Silver For The People.
Thanks to BrotherJohnF
Source: http://silveristhenew.com/2016/04/18/pepsi-earnings-explained-for-17-year-old-hedge-fund-managers/
