PURCHASE, N.Y. — PepsiCo Inc. will close four Frito-Lay factories by the end of the year as it moves to streamline production, the company said Thursday.
The snacks and soft-drink maker will shutter plants in Allen Park, Mich.; Council Bluffs, Iowa; Beaverton, Ore.; and Visalia, Calif., it said.
Purchase-based Pepsi said about 250 of the 780 jobs to be lost will be added to other Frito-Lay sites.
The move will leave Pepsi's Frito-Lay North America unit with 39 plants in the United States and Canada. Production will increase at 24 of the locations, Pepsi said.
Frito-Lay's U.S. staff level will remain at about 45,000, Pepsi said. Pepsi employed about 143,000 people as of the end of 2003.
Pepsi will take a pretax charge of about $160 million, most of it in the fiscal fourth quarter, for the closings.
Also Thursday, Pepsi reported net income of $1.36 billion, or 79 cents a share, for the third quarter ended Sept. 4. In the same quarter last year, it earned $1.01 billion, or 58 cents a share. Tax benefits contributed 13 cents a share to the latest quarter's results.
Revenue rose 6.3 percent to $7.26 billion from $6.83 billion.
Frito-Lay's revenue rose 4.8 percent to $2.33 billion as Quaker snacks continued to hold back volume growth and revenue. However, Pepsi said Quaker snacks' performance has improved since the second quarter, helped by the introduction of Quaker Q-Smart low-carbohydrate bars.
Pepsi Beverages North America generated revenue of $2.15 billion, an increase of 3.3 percent, even as volume fell 1 percent. Volume of carbonated soft drinks such as Pepsi dropped 4 percent, while volume increased 5 percent for noncarbonated beverages, led by Gatorade, Propel Fitness Water and Tropicana juice.
Pepsi said the net effect of the tax benefits recorded in the third quarter and the plant-closing charge to be taken in the fourth quarter will be an increase in full-year earnings of about 6 cents a share. As a result, Pepsi raised its earnings estimate for the year to at least $2.35 a share from its previous estimate of $2.29 a share.
Shares of Pepsi rose 55 cents, or 1.1 percent, to close Thursday at $48.65 on the New York Stock Exchange.