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Larry Young, President and Chief Executive of the Dr Pepper Snapple Group (DPS), rang the Opening Bell at the New York Stock Exchange today (7 May) to mark the début of DPS as an independent company listed on the exchange.
DPS was formerly the Americas Beverages division of the UK based Cadbury Schweppes group, but has now been spun off from Cadbury’s core confectionery business. The new company is North America’s third biggest producer of non-alcoholic refreshment beverages, with a market share of about 15%, behind major rivals Coca-Cola (43%) and PepsiCo (31%).
In addition to its flagship lines, Dr Pepper and Snapple, the DPS portfolio includes a wide range of carbonated and still brands such as 7 UP, Mott’s, A&W, Sunkist Soda, Hawaiian Punch, Canada Dry, Schweppes, RC Cola, Diet Rite, Squirt, Penafiel, Yoo-hoo, Rose’s and Clamato.
About 75% of the company’s volume comes from brands that rank either first or second in their category. Over the past four years, the unit was the only one of the big three US producers to increase its share of the carbonated soft drinks segment. Total revenue in 2007 was $5.7 billion.
A new era ahead “Today marks the beginning of a new era for our business,” said Larry Young. “We have a strong and sustainable business model, and can leverage our integrated system for future growth.
“We have confidence in the beverage industry, and we are looking forward to seizing the opportunities as a standalone company. Our CSD portfolio continues to grow, and our non-carbonated brands have regained momentum.
“We have also made strategic bottling and distributing acquisitions that are improving our capabilities and protecting the equity of our brands. The success we are realising with today’s listing has been a lengthy process, and we are looking forward to solely focusing on the beverage business.”
However, many analysts were sceptical about the company’s future prospects – noting that it was launching into independent existence at a time when the US economy is in trouble, and the soft drinks market is generally weak.