Beverage maker Keurig Dr Pepper beat Wall Street expectations for first-quarter sales and profit, helped by steady demand for its high-priced sodas and tonic water.
Demand for the company's popular soft drinks like 7UP and Sun Drop citrus soda, and Schweppes tonic water held steady as lower-income consumers stretched their budgets to spend on at-home meals and beverages.
Price increases undertaken over the past quarters have helped beverage makers like Keurig Dr Pepper shield their margins from rising costs of coffee, a key source of the caffeine in their beverages.
The company's prices were up 3.1%, while volumes were flat in the quarter. Larger peer PepsiCo reported better-than-expected quarterly results earlier this week, but still saw volumes decline.
Quarterly Highlights
Keurig Dr Pepper posted adjusted profit of 38 cents per share for the quarter ended 31 March, marginally above analysts' estimates of 35 cents per share.
The company posted net sales of $3.47 billion (€3.2 billion), compared to analysts' estimate of $3.41 billion (€3.1 billion) according to LSEG data.
The ready-to-drink tea maker appointed Tim Cofer as CEO, succeeding Bob Gamgort, effective 26 April.
Keurig Dr Pepper also reaffirmed its annual sales and profit forecast.
Cofer commented, "I am honored to lead the next chapter of value creation as CEO of Keurig Dr Pepper and excited to partner with Bob, our board, and all 28,000 colleagues to unlock our full potential as a beverage industry leader. [...]
"I'm pleased with our strong first quarter results, which reflect consistent execution across the organisation and demonstrate the health of our business. This performance underscores our confidence in our 2024 outlook, which is in-line with our long-term financial algorithm."
News by Reuters, additional reporting by ESM.
