PepsiCo : Britvic sees annual profit ahead of market view, extends PepsiCo partnership
October 20, 2020 at 03:11 am EDT
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(Reuters) - British soft drinks maker Britvic said on Tuesday it expects annual adjusted operating profit to be slightly ahead of market expectations, helped by the reopening of the hospitality sector and as more people consumed its drinks at home.
The company also said it has reached a 20-year agreement with PepsiCo for the production, distribution, marketing and sales of the U.S.-based firm's carbonated soft drinks, including Pepsi, 7UP and Mountain Dew, in Great Britain.
The agreement extends a partnership that began in 1987 and would also give Britvic responsibility for the Rockstar energy drink, which PepsiCo acquired earlier this year in a $3.85 billion (3 billion pounds) deal.
Shares in Britvic were up 3.2% at 775 pence in early trade.
The company, however, said fresh lockdown restrictions and lower capacity in the hospitality sector due to social-distancing measures would continue to have an impact on its performance in 2021.
Bars, restaurants, cinemas and other public spaces were allowed to reopen in July following months of restrictions, but a second wave of coronavirus infections prompted the government to introduce fresh curbs last month, including the early closure of pubs.
Analysts expect Britvic to report an adjusted operating profit of 160.9 million pounds for fiscal 2020, according to a company-compiled consensus.
The company, whose brands include Tango, J2O, Fruit Shoot and Teisseire, also said it intends to make all of its plastic bottles from 100%-recycled plastic by the end of 2022.
(Reporting by Tanishaa Nadkar in Bengaluru; Editing by Aditya Soni)
PepsiCo, Inc. is one of the worldwide leaders in producing non-alcoholic beverages and snacks. Net sales break down by area of activity as follows:
- North America (60.8%): sale of beverages (49.7% of net sales; sodas, concentrated juices, water, tea and coffee-based beverages; Aquafina, Diet Mountain Dew, Diet Pepsi, Gatorade, Gatorade Zero, Mountain Dew, Pepsi, Propel brands, etc.), snacks (44.7%; chips, tortillas and pretzels; Lay's, Doritos, Tostitos, Cheetos, Fritos, Ruffles, etc.), and cereals (5.6%; ready-to-eat cereals, rice, wheat, etc.);
- Europe (14.5%): sale of snacks (Cheetos, Chipita, Doritos, Lay's, Ruffles and Walkers brands) and beverages (7UP, Diet Pepsi, Lubimy Sad, Mirinda, Pepsi and Pepsi Max);
- Latin America (12.7%): sales of snacks (Cheetos, Doritos, Emperador, Lay's, Mabel, Marias Gamesa, Ruffles, Sabritas, Saladitas and Tostitos brands) and beverages (7UP, Gatorade, H2oh!, Manzanita Sol, Mirinda, Pepsi, Pepsi Black, San Carlos and Toddy)
- Asia/Pacific/Australia/New Zealand (6.7%): sale of snacks (BaiCaoWei, Cheetos, Doritos, Lay's and Smith's brands), beverages and syrups (7UP, Aquafina, Mirinda, Mountain Dew, Pepsi and Sting);
- Africa/Middle East/South Asia (5.3%): sale of snacks (Chipsy, Doritos, Kurkure, Lay's, Sasko, Spekko and White Star brands) and beverages (7UP, Aquafina, Mirinda, Mountain Dew and Pepsi).
Net sales are distributed geographically as follows: the United States (57%), Mexico (7.7%), Canada (4.1%), Russia (3.9%), China (3%), the United Kingdom (2.1%), Brazil (1.9%), South Africa (1.9%) and other (18.4%).