Dr Pepper profit slides 6% on higher costs
July 27, 2011
by Eric Schroeder
PLANO, TEXAS — Higher costs weighed on earnings at Dr Pepper Snapple Group, Inc. in the most recent quarter. Net income in the second quarter ended June 30 totaled $172 million, equal to 78c per share, down 6% from $183 million, or 75c per share, in the same period a year ago. Net sales, meanwhile, rose 4% to $1,582 million from $1,519 million.
D.P.S.G. said price/mix added approximately 2 percentage points to net sales growth, while revenue recognized under The Coca-Cola Co. licensing agreements and the favorable impact of repatriated brands added 1 percentage point.
“Once again our portfolio of leading, consumer-preferred brands demonstrated resilience despite continued macroeconomic and consumer pressures,” said Larry Young, president and chief executive officer. “Our teams remain committed to executing our focused strategy, ensuring our products are top of mind and close at hand. To cover higher input costs, we are raising prices and driving incremental productivity through our developing Rapid Continuous Improvement capabilities. We do so with a goal of delivering value to our customers and ensuring we’re investing for the long-term health of this business.”
For the six months ended June 30 net income was $286 million, or $1.28 per share, up 5% from $272 million, or $1.09 per share, in the same period of fiscal 2010. Net sales for the six months increased 5% to $2,913 million from $2,767 million.
The company said it expects full-year net sales to increase 3% to 5% and full-year diluted earnings per share to be in the $2.70 to $2.78 range.