Keurig Dr Pepper has forecast annual profit above Wall Street expectations, after beating fourth-quarter revenue and profit estimates, aided by strong demand for its higher-priced beverages including sodas and sports drinks.
The Yoo-hoo chocolate drink maker enjoyed steady sales as consumers indulged in its pricier products, swayed by the burgeoning popularity of its energy drinks and keen promotional efforts.
Keurig Dr Pepper has been introducing new flavour variants to its lineup, including the recently launched Dr Pepper Blackberry and 7 Up Tropical, to hold consumer attention amid dense competition.
Earlier this month, larger rival Coca-Cola had surpassed its profit and revenue expectations on the back of price hikes.
Shares of Keurig Dr Pepper, which fell about 4% in 2024, were up nearly 3% in premarket trading.
By The Numbers
Keurig Dr Pepper expects its annual adjusted profit to grow in the high-single digits, compared with analysts' average estimate of a 6.2% growth, according to data compiled by LSEG.
The company expects mid-single digits growth in annual net sales, compared with estimates of a 5.6% rise.
The Sun Drop maker posted an adjusted profit of 58 cents per share for the quarter ended 31 December, narrowly beating estimates of 57 cents.
Net sales rose 5.2% to $4.07 billion (€3.9 billion) in the fourth quarter, topping estimates of $4.02 billion (€3.8 billion).
The company's average selling prices rose 0.9%, while its unit case volumes increased 5.3%.
However, high prices of coffee have affected the company's US coffee segment, its second largest unit.
The unit's net sales were down 2.4% in the fourth quarter.
'Strong Financial Performance'
Keurig Dr Pepper CEO, Tim Cofer, stated, "In 2024, we delivered strong financial performance consistent with our long-term algorithm and advanced our strategy to lay the groundwork for KDP's next phase of growth.
"We gained market share through exciting innovation, marketing, and activation across our CSD and coffee brands, drove win-win outcomes with partner brands such as Electrolit and C4, and took bold action to extend our portfolio and route to market with the acquisition of GHOST and select territory expansions."
News by Reuters, additional reporting by ESM.
