Pepsi Bottling Group said today (31 January) that full-year net earnings rose 2% on the back of "strong volume growth" in each of its key markets.

PBG, the world's largest bottler of Pepsi drinks, posted net income of US$466m in 2005, up from US$457m a year earlier.

Volumes and net revenue per case rose 4% on the year, the company said, thanks to growing sales of its non-CSD portfolio.

PBG chairman and CEO John Cahill said: "PBG's story in 2005 was about robust topline growth in all of our major territories and the successful navigation of a challenging cost environment. Our teams around the world remained focused on our goals and closed out the year beating many of those objectives.

"Innovation in the U.S. and several countries in Europe helped us drive excitement in the category and volume growth for PBG. Our non-carbonated portfolio in each of our territories performed well, contributing to our strong volume growth."

He added: "The US pricing environment proved to be favorable throughout the year and this continues into 2006. Finally, in Mexico, our topline continued to move upward, though profit growth was below our expectations."

Cahill said PBG expected case volumes to grow by around 3% this year with sales in the US were slated to rise by 1-2%.

"The momentum we generated in the second half of 2005 is moving us forward in 2006. Our plans are designed to deliver a strong topline performance once again across our territories. The underlying state of our business is very encouraging and we expect to deliver another year of strong results for PBG shareholders."

Mark Swartzberg, a drinks analyst at US investment bank Stifel Nicolaus, agreed that PBG's underlying performance was "good".

"The cost of sales remains a challenge, but we continue to find evidence that the company is managing the situation well.  For example, in the (fourth) quarter US net revenue per case growth accelerated, driving improved profit growth and no major slowdown in volume," he said.