Excluding a separation-related foreign deferred tax charge in the current year and a net gain on certain distribution agreement changes in the prior year, the company earned $0.40 per share compared to $0.37 in the prior year period.
For the quarter, bottler case sales (BCS) volume increased 3% reflecting solid growth across the portfolio. Third-party bottler concentrate buy-in toward the end of 2009, a decline in contract manufacturing and unfavourable comparisons related to the successful Crush launch and related pipeline fill in 2009 resulted in a 3% decline in sales volume.
Reported net sales were down 1%. Segment operating profit (SOP) was flat, reflecting lower packaging and ingredient costs offset by higher marketplace and productivity office investments as well as costs associated with the startup of the Victorville, California, facility. Foreign currency added one percentage point of growth to net sales and SOP. Reported income from operations was $187 million compared to $265 million in the prior year period.
DPS president and CEO Larry Young said: “Despite the carryover of weak consumer trends, an abnormally wet and cold January and February and our toughest quarter of the year, our portfolio demonstrated resilience with BCS up 3%. In the quarter, we completed our licensing agreements with PepsiCo, achieved our target capital structure, opened our new West Coast facility and commenced our share repurchase program.
“While the US economy remains fragile, we are starting to see improvements in underlying consumer trends including the critical immediate consumption and fountain foodservice channels. This improvement, combined with winning innovation, continued white space and cold drink expansion opportunities and ongoing investments in brand health gives me confidence in our full year outlook and the long-term growth prospects for this business. We remain focused on completing key infrastructure investments in 2010 and capitalising on continuous improvement opportunities.”
Source: Dr Pepper Snapple Group Inc
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