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BUSINESS NEWS: PepsiCo’s health kick pays off
PepsiCo beat analysts’ forecasts and reported a 12% increase in net revenue for the second quarter despite pressure on margins from high commodity costs. Earnings per share were also up 15% compared with same period last year.
Beverage growth in the North American market was driven by PepsiCo’s portfolio of non-carbonated beverages, which increased by 23%. The non-carbonated portfolio performance was driven by double-digit growth in Gatorade, Aquafina, Lipton tea drinks, Tropicana and Propel. The firm also attributed the results to double-digit growth in the Middle East, China, Argentina, Thailand and Russia – a result of the group’s rapid international expansion.
PepsiCo has recently signed a partnership deal with a large US agricultural cooperative to market Ocean Spray cranberry juice, bolstering its portfolio of healthy beverages. Ocean Spray is one of North America’s best-selling juice brands with sales of $1.4 billion.
Under the agreement, PepsiCo will market, bottle and distribute single-serve Ocean Spray drinks in the US and Canada, as well as developing new products with the co-op. PepsiCo and Ocean Spray had worked together in the 1990s, but the partnership ended in 2000.
© db August 2006