NEW YORK: PepsiCo Inc said profit this year will rise about 2 per cent as the strong dollar weighs on revenue abroad, nearly offsetting gains in its North American businesses.

Earnings in 2016 will be $4.66 a share, excluding some items, up from $4.57 last year, the Purchase, New York-based company said in a statement Thursday. Analysts estimated $4.76 for the current year, on average. The forecast and estimates may not be comparable.

The dollar’s two-year surge has reduced the value of PepsiCo’s results abroad when translated back into the US currency. The company forecast that trend will continue this year, projecting that exchange-rate effects will reduce profit by 4 per cent.

“Pepsi’s initial guidance will likely be somewhat conservative as management will likely guide to an initial target it believes it can achieve even if the macro situation deteriorates further,” John Faucher, an analyst at JPMorgan Chase & Co., said in a note before the results were released.

PepsiCo’s fourth-quarter profit was $1.06 a share, excluding items. That matched analysts’ estimates. While sales fell 6.8 per cent to $18.6 billion, that topped analysts’ $18.5 billion projection. The company also raised its annual dividend 7.1 per cent to $3.01 a share.

PepsiCo fell 0.7 per cent to $97.62 yesterday in New York. The shares have slid 2.8 per cent this year.

International sales

Currency effects took a bite out of fourth-quarter sales. Net revenue fell 26 per cent in Latin America and 17 per cent in Europe and sub-Saharan Africa. The company’s domestic units fared better, with Frito-Lay North America and North America Beverages posting 2 per cent sales gains. The Quaker Foods North America division saw sales fall 1 per cent.

PepsiCo, which makes Doritos and Mountain Dew, has increased its “better for you” offerings to appeal to consumers increasingly wary of sugary drinks and artificial sweeteners. The company removed aspartame from Diet Pepsi in August, announced a partnership with smoothie maker BarFresh Food Group Inc in October and introduced a line of healthy vending machines in December.

Chief Executive Officer Indra Nooyi has worked to cut costs and to find new sources of growth from emerging markets, but the faltering global economy and strong dollar may have hampered gains in those areas.

PepsiCo ended its joint venture with German dairy giant Theo Muller Group in December, citing weak sales. The company also was rebuffed by yoghurt maker Chobani, which recently declined the company’s offer to take a majority stake.