News briefs: Coca-Cola, SABMiller and Cadbury Schweppes

By Neil Merrett

- Last updated on GMT

Related tags Cent Dr pepper snapple group

This week, Coca-Cola and SABMiller expect further profit ahead
after recording sales improvements, while Cadbury Schweppes moves
nearer to its beverage-arm demerger.

Coca-Cola praises entire portfolio over sales growth Sales of Coca Cola's non-carbonated beverages continued to grow well beyond those of sparkling beverages, as the company today posted a 15 per cent improvement in first quarter profit, amounting to $1.8bn.

The company said that on an international basis, sales volumes of carbonated beverages were up by three per cent over the quarter, while those for non-carbonated alternatives rose 17 per cent for the three-month period ending 28 March.

Sales increased by 21 per cent to $7.3bn, compared to the same period last year, with international growth helping to offset the company's US operation, which have been bogged down by economic difficulties, Coca-Cola said.

Company president Muhtar Kent said that the company had posted strong growth across its brand portfolio and, despite the economic challenges relating to the US market, expected further growth in the future.

"I remain optimistic about the progress we are making and committed to continued improvement in the execution of our strategies," he stated.

"Even in the face of a difficult macroeconomic climate, I believe that by continuing to collaborate with our bottling partners and maintaining an unrelenting focus on integrated consumer marketing and commercial and franchise leadership, [the company] will achieve another successful year."

Operating margins for the three-months were down over the same time last year though, falling by 1.3 percentage points.

Of its international operations, Coca-Cola said that sales volume growth of its brands per unit were up by double digit figures in a number of emerging markets like China, India, Brazil, Turkey, Russia and other Eastern European markets.

In the European Union, growth was less pronounced at three per cent, while volumes in the company's North American market remained unchanged due to the economic climate in the region, the company said.

SABMiller expects full year success SABMiller says it expects to meet the higher end of its growth targets for the 2007 fiscal year despite increased production costs for its brands.

The brewer said that sales of its lager brands for the twelve months ending 31 March were expected to be up by 16 per cent in a trading statement issued this week.

Price increases for it brands, as well as an extended portfolio of goods offered were attributed by the company to the expected growth for the year, as well as a focus on production efficiency, the company said.

The company's European, and Asian & African operations have been key to meeting these expectations, according to the brewer.

In Europe, beverage sales volumes were up by eight per cent on an organic basis, helped particularly by more eastern markets in the region, SABMiller said.

The brewer claimed that in Romania alone, volumes rose 28 per cent helped by a rebranding and packaging of the Timisoreana brand.

In Russia, premium beer sales increased by 14 per cent.

Through SABMiller's Africa and Asia segment, combined organic growth within sales volumes for its lager brands is expected to increase by 15 per cent during the year.

The company said this was helped by market share improvements of its CR Snow label in China, though poor weather during the final quarter had impinged on full year profitability.

India also posted strong growth over the period, while the company's African operations, excluding Zimbabwe, posted a six per cent increase in lager sales volumes, on an organic basis.

In Latin America, total lager sales volumes for the group over the twelve months increased by six per cent across the region, while in the US, the company's Miller arm said it had posted a 3.1 per cent rise in sales to retailers.

Cadbury Schweppes sets demerger date Cadbury Schweppes has set the date of 7 May for the demerger of its beverage arm into the Dr Pepper Snapple Group (DPSG).

The group said earlier this week that it has secured credit agreements for the split of the $11bn business, ahead of the proposed listing on the New York Stock Exchange next month.

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