USA: Dr Pepper Snapple sales affected by demand for diet products

Dr Pepper Snapple Group, the US soft drinks company, has reported an increase in net income and net sales for its second fiscal quarter despite being hit by consumers switching to diet beverages.

Net income increased by 35% on the prior year period to $210 million, while net sales rose 1% to $1,631 million, as a sales volume increase, favourable product and package mix and pricing were partially offset by higher discounts and 1 percentage point of unfavourable foreign currency, the company reported.

PS President and CEO Larry Young said: “As I look back on the first half of the year, there’s no question that we’ve posted strong results in a tough environment. Our teams remained focused on executing our strategy, and we’ve made good progress against our key priorities. We’re gaining distribution and availability across our key brands and packages while increasing our presence in single-serve and building our brands with innovative and targeted marketing programs”.

However Mr Young also acknowledged that demand for diet products had affected performance. In a call with analysts he said: “Diet is taking us down. We're all over it, we're really digging deep into it, and we have programs for the second half that we think are really going to take this on”.

According to Food Business News, the company is experimenting with mid-calorie products and smaller pack formats as a means of offering lower-calorie options.

Source: Dr Pepper / Food Business News