Pepsico upbeat on sales prospects

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Pepsico, the world's second-largest drinks firm, said sales of its snacks and soft drinks are continuing to rise despite consumer spending concerns.

Shares in the firm behind Pepsi Cola, Frito Lay and Quaker Oats rose 4% as sales in the three months to 29 December hit analyst expectations.

Pepsico predicted 2008 sales would rise by between 3% and 5%, with net profits rising by between 5% and 10%.

Last month the firm, which bottles Pespi, reported flat US sales.

Sale in the quarter rose 17% from a year earlier to $12.35bn (Â£6.2bn).

Pepsico said that net profit for the quarter was $1.26bn - 31% lower than in the same period in 2006, which was buoyed by a tax benefit.

The firm is second to Coca-Cola in global soft drink sales.

It has recently partnered with Starbucks to sell Frappucino bottled drinks in China.