Dr Pepper Snapple Q2 Results Miss Estimates, Backs 2013 Outlook

(RTTNews) - Non-alcoholic beverage maker Dr Pepper Snapple Group, Inc. (DPS) reported Wednesday a profit for the second quarter that declined from last year, reflecting a revenue decline amid lower sales volumes.

Both core earnings per share and quarterly revenues missed analysts' expectations. The company also reaffirmed its core earnings guidance for the full-year 2013.

"I am pleased with the perseverance of our people as they continued to execute our strategy amid a very challenging environment. During the quarter, our business was negatively impacted by unseasonably cold and wet weather, a cautious consumer and continued CSD category headwinds," President and CEO Larry Young said in a statement.

The Plano, Texas-based maker of Dr Pepper, 7UP, Mott's, Snapple, Canada Dry reported net income of $155 million or $0.76 per share for the second quarter, lower than $178 million or $0.83 per share in the prior-year quarter. Excluding items, core earnings was $0.84 per share, compared to last year's $0.85 per share.

On average, 14 analysts polled by Thomson Reuters estimated earnings of $0.85 per share for the quarter. Analysts' estimates usually exclude special items.

Net sales for the quarter edged down 1 percent to $1.61 billion from $1.62 billion in the same quarter last year on 4 percent decline in sales volumes, partially offset by 2 percentage points positive impact of favorable pricing and mix. Sales missed ten Wall Street analysts' consensus estimate of $1.64 billion by a whisker.

Net sales for beverage concentrates grew 2 percent, while packaged beverages net sales declined 2 percent from last year. Net sales for Latin America beverages improved 5 percent from a year ago.

Total bottler case sales volume for the quarter declined 3 percent from last year as volumes of carbonated soft drinks declined 3 percent and non-carbonated beverages decreased 2 percent. Volumes also declined 4 percent in the U.S. and Canada, but grew 2 percent in the Caribbean and Mexico.

Looking ahead to fiscal 2013, the company said it continues to expect core earnings in the range of $3.04 to $3.12 per share, on projected annual net sales growth of about 2 percent. Street is currently looking for full-year 2013 earnings of $3.09 per share, on revenue growth of 2.4 percent to $6.14 billion.

"Changing consumer behavior takes time, and we remain committed to giving consumers a reason to come back to the CSD category. With strong innovation and execution plans in place, I am encouraged about our opportunities for the remainder of 2013," Young added.

In Wednesday's regular trading session, DPS is currently trading at $46.97, down $0.71 or 1.50% on a volume of 0.59 million shares.