PURCHASE, NY. — PepsiCo, Inc., when giving 2023 fiscal-year financial results, shed light on how a Quaker recall is affecting the company.

“We had a food safety incident in our Quaker supply chain in the US that has impacted us in November, December, and it will continue to impact us, I think, for at least for the first half of the year until we recover our supply chain to normality,” said Ramon Laguarta, chief executive officer of PepsiCo, in a Feb. 9 earnings call.

Within Quaker Foods North America, operating profit in the year ended Dec. 30, 2023, declined 19% to $492 million. The loss reflected a negative impact of 22 percentage points from product returns and charges associated with the Quaker recall; certain operating cost increases; a decrease in organic volume; an impact of 9 percentage points from higher commodity costs, higher advertising and marketing expenses; and an unfavorable impact of 2 percentage points from a 53rd week in 2022.

Quaker on Dec. 19, 2023, recalled Chewy granola bars, puffed granola and granola oats cereal. In mid-January the recall expanded to Quaker Chewy cereals, Cap’n Crunch bars and some cereals.

Companywide, Purchase-based PepsiCo had net income of $9.07 billion, equal to $6.56 per share on the common stock, which marked a 1.8% increase from $8.91 billion, or $6.42 per share, in the previous fiscal year. Net revenue increased 6% to $91.47 billion from $86.39 billion. Organic revenue increased 10%. PepsiCo’s stock on the Nasdaq closed at $167.67 per share on Feb. 9, which marked a 3.6% decrease from a close of $173.85 per share on Feb. 8.

 PepsiCo in 2024 expects at least 4% growth in organic revenue and at least 8% growth in core constant currency earnings per share. Laguarta said global geopolitical events are impacting some markets and might continue to do so in the first half of 2024.

“We feel good about the fact that we think wages will go higher than inflation next year, and we hope that by the summer, interest rates will go down and that will create another source of oxygen for disposable income in households,” he said.

Within Frito-Lay North America, operating profit in the fiscal year increased 10% to $6.78 billion, primarily reflecting net pricing, productivity savings and a favorable impact of 2 percentage points from prior-year impairment charges. Cheetos, Doritos and Fritos each delivered net revenue growth of double-digit percentages while Ruffles was up high single-digit percentages and Lay’s was up mid-single-digit percentages. Smaller brands such as PopCorners, SunChips and Miss Vickie’s geared to nutritious or specialty snacking occasions delivered double-digit growth.

Within PepsiCo Beverages North America, operating profit decreased 52% to $2.25 billion, primarily reflecting an unfavorable impact of the prior-year gain of $3 billion associated with the sale of certain brands and 2023 impairment charges of $321 million.

Companywide in the fourth quarter, net income more than doubled to $1.30 billion, or 94¢ per share on the common stock, from $518 million, or 37¢ per share, in the same time of the previous year. Fourth-quarter net revenue slipped 0.5% to $27.85 billion from $28 billon. PepsiCo saw the food and beverage category slow down in the fourth quarter, Laguarta said.