Coca-Cola Bottling yesterday (27 October) reported a healthy rise in third quarter earnings despite the pressure of fuel cost rises and interest expense.

The soft drinks bottler said it earned US$8.8m, or US$0.97 per share, for the third quarter of 2005. In the third quarter of 2004, the company earned US$6.1m or US$0.67 per share.

J. Frank Harrison, III, chairman and CEO, said: "The company's net income growth in the third quarter of 2005 was driven by solid gross margin production which more than offset increases in fuel costs and interest expense. The gross margin improvement reflects profitable volume growth of approximately 4% as well as an increase in average revenue per case of approximately 3% compared to the third quarter of 2004. The volume growth resulted from the successful launch of Coca-Cola Zero, Dasani flavours and Vault, The Coca-Cola Company's new carbonated citrus product, as well as strong growth in Dasani and Powerade. The company introduced Vault in approximately half its territories in June and will roll out this product in the balance of its territories in November."

In addition to the positive impact of product innovation, the company's Powerade volume grew by 37% and Dasani volume grew by 26% in the third quarter of 2005 compared to the third quarter 2004. Also, the company's energy products portfolio contributed approximately 15% of the gross margin growth in the third quarter of 2005.

In the fourth quarter, the company has initiated additional net selling price increases to partially offset increases in fuel costs.