PepsiCo Inc

posted a higher quarterly profit that met Wall Street expectations, helped by brisk sales in international markets such as India, while drinks volumes declined in North America.

The maker of Pepsi-Cola drinks and Frito-Lay snacks stood by its forecast for earnings growth of 11 percent to 13 percent for the year, and said it still hopes to complete its $7.8 billion acquisition of its two largest bottlers by the end of the month.

Rival Coca-Cola Co also cited strong demand in emerging markets such as China and India when it reported higher-than-expected quarterly sales earlier this week.

PepsiCo, the world's second largest soft drink maker after Coca-Cola, earned $1.43 billion, or 90 cents per share, in the fourth quarter, compared with $719 million, or 46 cents per share, a year earlier.

On a core basis, which excludes items such as restructuring and merger costs, profit rose to $1.42 billion, or 90 cents per share, from $1.39 billion, or 88 cents per share.

Revenue rose 4.5 percent to $13.3 billion.

Analysts on average were expecting a profit of 90 cents per share on revenue of $13.26 billion, according to Thomson Reuters I/B/E/S.

MIXED VOLUME

Across the company's portfolio, the total volume of snacks sold rose 1 percent, while beverage volume fell 1 percent.

Volume fell 5 percent in the North American beverage business and was flat in its Americas food unit, driven by a flat quarter at Frito-Lay North America, a 2 percent decrease at Quaker Foods North America, and a flat performance in its Latin American food business.

Volume in its international division rose 4 percent in snacks and 3 percent in beverages. In Europe, volume fell 3 percent in snacks and was flat in beverages. In the unit covering Asia, Africa and the Middle East, snack volume soared 13 percent and beverage volume rose 5 percent, due in part to strong growth in India.

PepsiCo, which also owns Tropicana, Quaker and Gatorade, stood by its 2010 forecast for earnings growth of 11 percent to 13 percent, excluding one-time items and assuming the bottler deal closes.

Chief Financial Officer Richard Goodman said earnings should grow at a mid-to-high single digit percentage rate in the first half of the year and a mid-teen percentage rate in the second half.

The company plans to record a first-quarter charge of about $125 million related to the devaluation of the Venezuelan bolivar. It said core earnings per share, in constant currencies, would not be affected.

Credit Suisse analyst Carlos Laboy said it looked like the North American beverage business was rebounding, but said it was not critical this quarter.

On the eve of a major surgery it's futile to point out that the patient cosmetically looks a little better, he wrote in a research note.

DEAL ON TRACK

PepsiCo launched a takeover bid for Pepsi Bottling Group Inc

and PepsiAmericas Inc

in April and struck a deal in August after sweetening its offer.

The bottlers' shareholders are set to vote on the deal February 17. PepsiCo aims to improve its North American operations through the acquisitions, by reducing costs and removing inherent tensions between PepsiCo and the bottlers, which currently count PepsiCo as both a shareholder and supplier.

PepsiCo expects $125 million to $150 million in merger benefits in 2010 and said that should rise about $400 million once the bottlers are fully integrated around 2012.

Shares of PepsiCo rose 0.5 percent to $60.65 on the New York Stock Exchange. The shares gained 7.4 percent from August 3, the day before it announced the bottler deal, through Wednesday, outpacing a 5.6 percent gain for the Dow Jones U.S. Food and Beverage Makers Index <.DJUSFB>, of which it is a component.

(Reporting by Jessica Wohl; additional reporting by Martinne Geller in New York; editing by Dave Zimmerman and John Wallace)

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