Pepsi said Thursday its latest earnings topped analysts' estimates, helped by higher prices for its products and strong sales in Latin America.
After the earnings announcement, the company's shares rose. (Click here to get the latest quotes for Pepsi.)
The maker of Pepsi, Gatorade and Lay's potato chips said net income rose to $1.66 billion, or $1.06 a share, from $1.42 billion, or 89 cents a share, a year earlier. Excluding items, Pepsi said it earned $1.09 a share, topping analysts' estimates of $1.05 a share, published by Thomson Reuters.
Net revenue fell 1 percent to $19.95 billion. However, after adjusting for the effect of structural changes in the company's business and an extra selling week in 2011 and currency exchange rates, revenue climbed 5 percent.
"To me, maybe the most heartening is the fact that we delivered 5 percent organic revenue growth. And if you look at really every region of the world, we saw good solid revenue growth — Europe at 3.5 percent in what's obviously a challenging economic environment," said Hugh Johnston, chief financial officer. "The U.S. did quite well for us, and the developing and emerging markets — both at 9 percent both for the quarter and for the year."
Analysts had expected the company to report revenue of $19.7 billion, according to a consensus estimate from Thomson Reuters.
"Overall, fourth-quarter quality was solid, including 5-percent organic revenue growth that stacks up well versus large cap peers and is probably slightly above consensus in the 4 to 4.5 percent range," Morgan Stanley analysts said in a note following the report.
For the full year, Pepsi expects its earnings on a constant currency basis to rise 7 percent to $4.10 a share.
"We feel like what we've done in terms of both the geographic transformation, as well as the change in the product portfolio to broaden ourselves, has put us in a spot where we can post these types of results consistently. And that's why we're talking about 2013 guidance with mid-single digit revenue, as well," Johnston told CNBC's "Squawk Box."
He added that he is seeing gradual strengthening in consumer demand domestically.
"As far as developed markets go, Europe obviously in the west has its challenges but Eastern Europe is doing quite nicely, and in the U.S., really over the last six to eight months, I would characterize it as a very slow, gradual strengthening in the consumer — slow and gradual but nonetheless detectable in there," Johnston said.
Pepsi also announced that it would raise its dividend to $2.27 per share from $2.15 a share, effective in June.
In the company's press release, CEO Indra Nooyi said last year the company took "significant steps" in 2012 to better position the company's business for "sustainable, long-term growth."
"We increased our brand investment, stepped up our innovation, improved our marketplace execution and embarked on an aggressive productivity program that will contribute to our profitability and act as a funding source of future investment," Nooyi said.