Local Pepsi unit reports 12% income growth

MANILA, Philippines - Higher sales volume in the third quarter allowed beverage maker Pepsi-Cola Products Philippines Inc. (PCPPI) to sustain growth in its earnings this year.

In a disclosure, PCPPI said third quarter net income rose nearly three percent to P122.8 million from P119.33 million a year ago as volume climbed 20 percent.

For the January to September period, its profit gained 12 percent to P780.7 million from P696 million given the 21-percent increase in sales volume.

“This achievement is considered remarkable in the face of intense competition. The rainy months of the third quarter is normally off-peak for the beverage players but we managed to overcome this and outperformed the industry for yet another quarter,” said PCPPI president Partho Chakrabarti.

Gross sales revenues, buoyed by high volume across major brands and categories like colas, jumped 16 percent to P6.1 billion in the third quarter and rose 17 percent to P19.4 billion in the nine-month period.

“The outstanding volume performance was built on solid ground as the company increased distribution by continuously investing in marketing and distribution assets such as trucks, power coolers, vending machines and glass containers,” PCPPI said.

Operating expenses, which increased 12 percent in the third quarter and 16 percent in the nine-month period, remained manageable despite high capital expenditures, the company said.

“The company managed to improve income from operations by 12 percent for the quarter and 16 percent for the nine-month period despite increased spending for marketing and continuous investments in manufacturing and distribution assets,” said Jika Dalupan, PCPPI’s vice-president for corporate affairs.

“We are now seeing these investments bearing fruit for our business,” she added.

PCPPI is the exclusive bottler of PepsiCo beverages in the Philippines which include Pepsi-Cola, Mountain Dew, Seven Up, Mirinda, Gatorade, Mug, Tropicana, Lipton, Sting and Premier.

PCPPI also just joined the fray in the powdered drinks category through Mirinda Powder Fun Mix as it aims to strengthen its non-carbonated business.

The listed firm is partly owned by Lotte Chilsung, one of the biggest beverage companies in South Korea. The company has established manufacturing facilities across the country, serving at least 440,000 outlets and providing employment through its extensive distribution network.