Beverage Industry

DPS reports declines in Q4, full-year 2013

Snapple, Schweppes and Latin America beverages show increases

February 13, 2014

Dr Pepper Snapple Group Inc. (DPS), Plano, Texas, reported its results for the fourth quarter of 2013 as well as the full year. For the quarter, reported net sales decreased 1 percent. Sales volume declines of 4 percent and less favorable trade adjustments were partially offset by favorable mix and price, the company says. For the full year, reported net sales were flat, and sales volume dropped 3 percent.

In terms of bottler case sales, volume declined 2 percent in the fourth quarter, with both carbonated soft drinks (CSDs) and non-carbonated beverages (NCBs) declining 2 percent. Likewise, bottler case sales volume decreased 2 percent, with both CSDs and NCBs declining 2 percent for the full year as well.

Dr Pepper volume decreased 2 percent last year, and the company’s “Core 4” brands declined 1 percent as mid-single digit declines in 7UP and Sunkist soda and a low-single digit decrease in A&W were partially offset by a mid-single digit increase in Canada Dry. Crush, Squirt and RC Cola all declined mid-single digits, while Sun Drop declined double-digits. However, Peñafiel increased double-digits, and Schweppes increased mid-single digits. Fountain foodservice volume was flat for the year.

Within NCBs, Hawaiian Punch volume declined 9 percent last year. This decline was partially offset by a 2 percent increase in Snapple and a mid-single digit increase in Mott’s.

By geography, volume in the United States and Canada declined 2 percent, and volume in Mexico and the Caribbean increased 3 percent for the year.

Broken out by segment, reported sales volume of beverage concentrates decreased 6 percent, and net sales decreased 4 percent for the quarter. For the year, beverage concentrates declined 4 percent in sales volume and increased 1 percent in net sales. Packaged beverages declined 2 percent in both sales volume and net sales for the quarter. This was partially offset by favorable product and package mix, the company says. For the full year, they decreased 3 percent in sales volume and 1 percent in net sales. However, Latin America beverages were a bright spot for the company. Sales volume and net sales for Latin America beverages increased 4 and 8 percent, respectively, for the quarter. The segment increased 3 percent in sales volume and 11 percent in net sales for the year.

“I am proud of the team’s ability to remain focused and execute against our strategy during a challenging year,” DPS President and Chief Executive Officer Larry Young said in a statement. “We continued to gain distribution and availability across our key brands and packages and grew volume share and held dollar share in the highly competitive CSD category.”

For 2014, the company expects full-year reported net sales to be flat to up 1 percent, it says.

“Our ‘Core 4’ and RC Ten platform is bringing lapsed consumer occasions back to the CSD category, and Rapid Continuous Improvement (RCI) continues to provide meaningful improvements while strengthening organizational capabilities,” Young said in a statement. “As we move into 2014, our teams will continue to build the Ten platform with programming focused on driving awareness and trial, provide consumers with balanced beverage options, and execute with excellence in the marketplace.”