Pepsi Cola earns 6% more on higher sales

MANILA, Philippines - Higher sales volume allowed beverage maker Pepsi-Cola Products Philippines Inc. (PCPPI) to post record earnings last year.

In a disclosure to the stock exchange, PCPPI said its net income rose six percent to P903.5 million million last year on “high volume growth, stable cost of inputs and manageable operating expenses.”

Gross sales revenue jumped 16 percent to P26.4 billion, driven by high turnover growth from both the carbonated and non-carbonated beverages segments. Sales volume grew 20 percent last year.

“Our focus on increasing our distribution across the country has been a key driver of our top-line growth,” said PCPPI president Partho Chakrabarti.

He said the company outperformed the industry growth anew in 2013.

Cost of sales, mainly driven by volume growth, climbed 16 percent last year. It consists predominantly of raw and packaging materials that accounted for 73 percent of net sales, PCPPI said.

PCPPI’s gross profit hit P6 billion last year, up 13 percent year-on-year.

“This achievement is commendable considering intense competition and the challenges brought about by Super Typhoon Yolanda. We experienced some setbacks since our plant in Tanauan was badly affected,” said Jika Dalupan, PCPPPI vice-president for corporate affairs.

PCPPI said operating expenses, despite the high capital expenditures, remained manageable. It accounted for 21 percent of net sales.

The beverage maker will invest P3.5 billion this year to continue expanding its production and distribution line as demand is expected to rise further.

It is also introducing more non-carbonated drinks this year to sustain its double-digit sales growth.

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

The firm is partly owned by Lotte Chilsung, one of the biggest beverage companies in South Korea. It has established manufacturing facilities across the country, serving at least 500,000 outlets and providing employment through its extensive distribution network.