Dive Brief:
- Dr Pepper Snapple reported a 2% net sales increase in the fourth quarter revenue to $1.55 billion, while net sales for the year grew 3% to $6.28 billion.
- The company's EPS jumped 26% to $185 million, or $0.97 per share, for the quarter, and 12% to $764 million, or $3.97 per share, for the year.
- Dr Pepper Snapple posted volume growth for carbonated and non-carbonated beverages for the year with an uptick of 1% and 4%, respectively. For the quarter, carbonated soft drinks were flat, while non-carbonated beverages grew 4%.
Dive Insight:
Dr Pepper Snapple has fared better than its major soda competitors in terms of sales growth, as Coca-Cola and PepsiCo reported declines of 8% and 7% respectively in the most recent quarter, though all three companies are battling consumers' shift away from soda.
As with other soda companies, non-carbonated beverages like RTD tea have presented growth opportunities for Dr Pepper Snapple. The company's Snapple brand is the third leading RTD tea brand in the U.S. and continues to grow, positioned behind only the Pepsi-Lipton Tea Partnership and AriZona Beverage Company. Snapple grew 4% in the fourth quarter and 6% for the full year, driven by distribution gains and innovation. The company also invested in sports drink startup Body Armor last year, acquiring a minority stake.
Dr Pepper Snapple has one thing going for the company that its two main competitors don't: Because 90% of Dr Pepper Snapple's net sales come from the U.S., the company hasn't been as heavily impacted by currency headwinds and slow international growth as Coca-Cola and PepsiCo. Still, even this company is not immune and expects net sales to be impacted by 2% and core EPS growth by 4% due to currency fluctuations this year.