The slump in US consumption of CSDs continues to make its mark, with Pepsi’s two largest bottlers, Pepsi Bottling Group and PepsiAmericas, both recording sharp falls in first-quarter profits.
Harsh weather in the quarter prompted both companies to issue profit warnings a few weeks ago.
Pepsi Bottling, the larger of the two, saw earnings of US$33m, down from US$54m in the same period a year before. Before an accountancy change the group earned US$39m. However the group still expects full-year earnings of $1.61 to $1.67 per share, excluding the effect of accounting changes. It forecast worldwide volume growth of 1% to 2% on a constant-territory basis, down from a target of 2% to 3% growth it gave in March.
PepsiAmericas saw its profits fall to US44.9m from US$23m last year as volumes in the US fell 7.4%. It said it still expects earnings per share growth of 9% to 11% percent this year, but it said growth would likely be at the low end of that range. The company also forecast worldwide volume growth of 1% to 2% for the year, with net price increases of 2.5 to 3.5 percent.