Corporate News

Better sales drive Pepsi profit

Posted on July 26, 2013

BEVERAGE MAKER Pepsi-Cola Products Philippines, Inc. grew its net income by nearly a tenth annually in the second quarter on the back of higher sales, according to the financial report the firm disclosed through the Philippine Stock Exchange yesterday.

THE COMPANY attributed profit growth last quarter to ‘record volume sales’ across all its beverage products. -- BW file photo
The company’s net income grew by 9.95% to P387.73 million in the April-June period from P352.65 million the previous year, the company’s unaudited condensed interim statements of comprehensive income showed.

“The company’s momentum of high volume growth from the past quarter continues as top-line growth for the second quarter is fueled by record volume sales across all major CSD (carbonated soft drinks ) and NSD (non-carbonated soft drinks),” the company said in its financial report.

The company’s carbonated products are Pepsi-Cola, 7Up, Mountain Dew, Mirinda and Mug, while its non-carbonated brands are Gatorade, Tropicana Twister juices, Lipton tea drinks, Sting energy drink and Propel fitness water.

Net sales jumped by 20.76% to P6.34 billion last quarter from P5.25 billion a year ago due to a 22% increase in sales volume.

Cost of goods sold -- consisting of raw and packaging materials -- rose by 20.95% to P4.56 million from P3.77 billion.

Pepsi’s second-quarter performance brought net income to P657.95 million in the first half, up by 13.93% from P577.50 million in the same six months last year.

Net sales increased by 17.45% to P11.44 billion from P9.74 billion, also on higher sales volume.

Cost of goods sold grew 17.28% to P8.28 billion tom P7.06 billion.

“Operating expenses for the quarter and for the six-month period remain manageable as the company sustained efforts to control costs,” the company said.

“Operating expense percentage to net sales remained at the same level as a year ago both for the quarter and for the six-month period.”

In a separate statement, Partho Chakrabarti, the company’s president, claimed Pepsi outperformed the industry.

“[S]ustaining our drive on product availability and affordability across the country… allowed us to achieve remarkable volume growth for the quarter -- the sixth consecutive quarter of strong, double-digit growth for the company,” the statement quoted Mr. Chakrabarti as saying. “We are pleased to have outperformed the industry for yet another quarter.”

Shares of Pepsi grew by 15 centavos or 2.54% to close at P6.05 apiece yesterday from P5.90 each on Wednesday. -- Cliff Harvey C. Venzon