Dr Pepper income up 39% on gain from Hansen deal
May 13, 2009
by Eric Schroeder
PLANO, TEXAS — Net income at Dr Pepper Snapple Group, Inc. rose 39% to $132 million, equal to 52c per share on the common stock, in the first quarter ended March 31, up from $95 million, or 38c per share, in the same period a year ago. The gain reflected the company’s decision to sell distribution rights to Hansen Beverage Co. Excluding one-time costs such as the gain from the distribution deal, the company earned 37c per share, still ahead of the consensus from Wall Street analysts.
Sales for the first quarter were $1,260 million, down slightly from $1,295 million during the first quarter of fiscal 2008.
"While the U.S. economy remains weak, consumer sentiment appears to be improving and we’re continuing to see a shift in purchase habits toward C.S.D.s and other value offerings," said Larry Young, president and chief executive officer. "Our portfolio of C.S.D.s and value juices performed extremely well in the quarter led by strong gains in Crush distribution and Hawaiian Punch and solid Dr Pepper and Core 4 growth. Pressure remains at the premium end of the portfolio, especially with Snapple."
Looking ahead, Dr Pepper said it expects full-year 2009 sales to be down 2% to 4%. Excluding the loss of Hansen product distribution and currency, though, the company expects net sales to grow 2% to 4%. Dr Pepper also raised its full-year earnings guidance to $1.70 to $1.78 per share, up 11c per share from earlier guidance.