PepsiCo (PEP 1.48%) isn't growing as quickly as its beverage-focused rival Coca-Cola (KO 0.95%), but the company is still enjoying its fastest expansion pace in years. That was the main takeaway from the soda and snack giant's recent fiscal fourth-quarter report, which also included an encouraging profit outlook for 2020.

In a conference call with Wall Street analysts, CEO Ramon Laguarta and his team broke down the main wins and losses that affected its recent operating performance while detailing their projection for the new year. Below are a few highlights.

A glass of soda.

Image source: Getty Images.

It was a very good year

Our organic revenue growth accelerated to 4.5% for the full year 2019 versus 3.7% in 2018, exceeding the initial target we set a year ago. All our divisions contributed to this growth.
-- Laguarta

The company noted several positive operating trends to close out the year, including accelerating volume growth in its core U.S. snack business. That boost delivered the unit's fastest annual expansion pace since 2013. 

The soda segment grew at a slower pace, 3% for the year compared with Coca-Cola's 6% organic sales spike. And Pepsi's soda gains came exclusively from higher prices rather than increased volumes. Still, it was the beverage unit's best performance since 2015, with standout gains in the Pepsi zero-sugar franchise and the Gatorade brand.

Elevated spending plans

We intend to continue to invest back in our business. We know that sustaining higher growth will require building stronger capabilities, ones which will be difficult to match by our competitors.
-- Laguarta

Management was happy to finally have some concrete benefits to point to from its elevated investment spending across areas like advertising, the supply chain, and the manufacturing base. These projects reduced free cash flow and resulted in slightly lower earnings for the year.

Yet executives drew a direct line between the initiatives and the accelerating growth pace. That progress was most notable in the Frito-Lay segment, which benefited from higher marketing, new warehouse and distribution centers, and additional selling displays.

Looking out to 2020

We expect total cash returns to shareholders of approximately $7.5 billion in 2020, comprised of dividends of $5.5 billion and share repurchases of $2 billion.
-- CFO Hugh Johnston

PepsiCo predicted a third consecutive year of roughly 4% organic sales growth, to trail Coke's 5% outlook for 2020. The company sees a return to robust earnings gains, though, as core profits rise 7% after falling 1% in 2019.

That profit boost will happen despite another year of elevated capital spending, to the tune of $5 billion, or roughly 7% of sales. Management sees this increased spending level as a new normal, at least until around 2023, when the company could see capital spending trend back down to roughly 5% of sales.

In the meantime, dividend investors can expect to see robust cash returns, partly through stock repurchases but mainly through a dividend that was just raised 7% to mark PepsiCo's 48th consecutive annual increase. Total returns in 2020 should reach $7.5 billion, versus $8.3 billion last year.