VendingMarketWatch.com |

Dr Pepper Snapple Group, Inc. reported second quarter 2010 diluted earnings of $0.74 per share compared to $0.62 per share in the prior year period. Year-to-date, the company reported earnings of $1.09 per diluted share compared to $1.14 per share in the prior year period. 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 $1.14 per diluted share compared to $0.99 in the prior year-to-date period.

For the quarter, sales volume increased 1 percent on solid branded sales growth. Contract manufacturing reduced sales volume growth by one percentage point as the company continued to de-emphasize this business. Net sales increased 3 percent reflecting sales volume growth, foreign currency benefits and revenue recognized under the PepsiCo, Inc. (PepsiCo) licensing agreements. Favorable pricing trends in Beverage Concentrates were offset by increased promotional activity in Packaged Beverages. Segment operating profit (SOP) increased 5 percent reflecting net sales growth and supply chain efficiencies offset by a $12 million increase in marketplace investments as well as increased productivity office costs. Reported income from operations was $310 million compared to $297 million in the prior year period.

DPS President and CEO Larry Young said in a prepared statement, "While we continue to see some signs of economic stability, consumer confidence remains weak. Investing behind our brands, driving traffic for our customers and delivering value to our consumers are still a must-do for us. Our portfolio of preferred flavored CSDs, teas and juices continues to do well despite macroeconomic headwinds and a changing beverage landscape. For the quarter, we continued to see solid consumer takeaway and we gained value share across the portfolio. I'm immensely proud of our teams for delivering strong results, achieving ongoing success with Snapple and embracing our Rapid Continuous Improvement initiative. Looking ahead, we remain confident in delivering on our commitments for 2010 and beyond."

For the quarter, BCS volume increased 3 percent with carbonated soft drinks (CSDs) growing 3 percent and non-carbonated beverages (NCBs) up 3 percent.

In CSDs, Dr Pepper volume increased 3 percent. "Core 4" brands - 7UP, Sunkist soda, A&W and Canada Dry - declined 1 percent. Canada Dry grew double digits while 7UP and A&W declined low single digits and Sunkist soda declined high single digits. Additionally, Crush and Squirt volume grew double digits. Fountain foodservice volume increased 4 percent.

In NCBs, Hawaiian Punch volume grew 7 percent on increased promotional activity in the grocery channel. Snapple grew 9 percent reflecting continued distribution gains across the portfolio. Aguafiel declined 10 percent on lower sales to third party distributors.

By geography, volume increased 2 percent in the U.S. and Canada and 10 percent in Mexico and the Caribbean.

Across all measured channels year-to-date, as reported by The Nielsen company, the company grew U.S. CSD dollar share 0.6 percentage points and flavored CSD dollar share 0.4 percentage points.

Sales volume

For the quarter, sales volume increased 1 percent on solid branded sales growth. Contract manufacturing reduced sales growth by over one percentage point as the company continued to de-emphasize this business. Beverage Concentrates