New products boost Pepsi PHL bottom line

PEPSI-COLA Products Philippines, Inc. (PCPPI) netted 23% more earnings during the third quarter, with the growth of its revenues outpacing sales volume amid the introduction of more product innovations.

The listed food and beverage manufacturer’s net income increased to P180 million from the P146 million posted for the comparable three months of last year, as sales surged 14% to P8.72 billion from P765 billion.

“Revenue growth continued to outpace volume growth in the third quarter owing to management’s strong focus on revenue management, new product initiatives and portfolio mix improvements,” PCPPI noted in its quarterly report.

In the nine months to September, the company’s net income reached P739.1 million or 5% above the P706.4 billion registered a year earlier, as higher cost partly offset the 13% improvement in sales to P26.8 billion from P23.68 billion.

The cost of goods sold climbed 15% during the nine months and 14% during the third quarter alone, as sugar prices sharply increased.

“Higher productivity versus last year, however, helped to partially mitigate the effects of sugar,” PCPPI said, with the nine- month gross profit rising 6% to P5.2 billion and the thirdquarter figure standing 8% higher at P1.6 billion.

Operating expenses, on the other hand, trailed the topline’s growth after PCPPI implemented prudent cost controls, which improved its margins by 110 basis points year to date and 91 basis during the third quarter.

PCPPI continues to expand its snacks portfolio by expanding its distribution in Luzon. In the first nine months, the company invested P2.9 billion to expand its distribution and marketing as well as increase its manufacturing assets.

Shares in PCPPI closed 10 centavos or 3.04% lower at P3.19 apiece on the Philippine Stock Exchange on Tuesday. —