Taco Bell Shows 18% Earnings Boost

Pepsico Inc. said Tuesday that its Taco Bell unit, showing strong growth for the fifth straight year, posted annual earnings of $253.6 million, an 18% increase over the previous year’s net income of $214.3 million.

Annual sales for the Irvine chain of Mexican-style fast-food eateries also rose 16% to $2.9 billion for the fiscal year that ended Dec. 25 from $2.5 billion the previous year.

Pepsico attributed Taco Bell’s increased profit to decreased food costs, additional outlets and more sales volume. Those gains, however, came with higher administrative costs and more losses at Hot ‘n Now, a hamburger chain owned and operated by Taco Bell.

In its fiscal fourth quarter, Taco Bell’s earnings rose 17% to $87.5 million from $74.7 million in 1992’s final three months. Quarterly revenue grew 20% to $975.9 million from $812.6 million.

Pepsico itself reported record results for the year and the last quarter.

The Purchase, N.Y., company, whose empire includes Pepsi Cola, Taco Bell, KFC and Pizza Hut, said annual profits more than quadrupled to $1.6 billion from $374 million in 1992. Revenue climbed to $25 billion from $22 billion the previous year.

Quarterly earnings grew to $442.5 million for the final quarter from $265.6 million in 1992’s last quarter. Revenue for the three-month period grew 14% to $7.7 million from $6.8 million in the previous year’s final quarter.