High sugar prices, start-up losses from snacks business drag Pepsi-Cola Philippines’ earnings
Pepsi Cola Products Philippines Inc. posted a net income of P900 million last year, just a five-percent growth from 2015, as high sugar prices drove up the cost of goods sold by 12 percent.
In a disclosure to the stock exchange, Pepsi Cola Products Philippines said its sales revenue grew by 11 percent to P35.8 billion last year as it focused on revenue management, new product initiatives and portfolio mix improvements.
The company said its capital expenditure amounted to P3.7 billion last year to drive distribution and marketing expansion and to acquire manufacturing assets to build capability. The company has been building up its snacks business which it started only in the fourth quarter of 2015.
If not for the snacks business start-up losses, the company said its net income would have improved by 20 percent.
Carbonated soft drinks account for the bulk of its net sales at P22 billion, followed by its noncarbonated beverages at P8 billion. The company’s snacks business generated only P159 million in net sales.