US: Dr Pepper Snapple Group swings back to black
Dr Pepper Snapple regains some fizz
Dr Pepper Snapple, the US-based soft drinks group, has reported a return to profits in 2009 and forecast a recovery in sales growth in 2010.
Net profits for the 12 months to the end of December reached US$555m, marking a return to profits after one-off charges dragged the group to losses of $312m in 2008.
Unfavourable currency rates and the loss of a licence for Hansen Natural's Monster Energy drink at the end of 2008 caused net sales to fall by 3% in 2009, to $5.5bn from $5.7bn.
Fourth quarter net sales were relatively flat, at $1.35bn against $1.37bn a year earlier. Volume sales rose by 4% in the quarter, with growth in both carbonates and non-carbonates, although the Dr Pepper brand reported a 1% volume decline.
The group said it expects to recover further in 2010, with net sales set to rise by between 3% and 5% and diluted earnings per share to hit a range of $2.27 to $2.35. Earnings per share were $2.17 in 2009.
"While we have made a lot of progress, we still have opportunities to optimise our supply chain, standardise our IT platforms and get our products in more consumers’ hands every day," said Dr Pepper Snapple president and CEO Larry Young.
Full-year operating income rose to nearly $1.1bn, from losses of $168m last year.
The firm expects to receive a one-off $900m payment in 2010 for licensing certain brands to PepsiCo. An unspecified portion of this will be used to cut debt.
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For the full Dr Pepper Snapple results announcement, click here.
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