Snapple 2010 Annual Report Download - page 50

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Beverage Concentrates
The following table details our Beverage Concentrates segment's net sales and SOP for 2010 and 2009 (dollars in millions):
Net sales
SOP
For the Year Ended
December 31,
2010
$ 1,156
745
2009
$ 1,063
683
Amount
Change
$93
62
Net sales increased $93 million, or approximately 9%, for the year ended December 31, 2010, compared with the year ended
December 31, 2009. The increase was primarily due to concentrate price increases, $37 million in revenue recognized under the
PepsiCo and Coca-Cola licenses, as well as a favorable impact of foreign currency. Concentrate price increases, which were
effective in January 2010, added an incremental $41 million to net sales during the year ended December 31, 2010. These increases
were partially offset by the loss of concentrate sales which resulted from the repatriation of brands associated with the PepsiCo
transaction and transfer of concentrate sales in the Caribbean to our Latin America Beverages segment.
SOP increased $62 million, or approximately 9%, for the year ended December 31, 2010, compared with the year ended
December 31, 2009, primarily driven by the increase in net sales and lower compensation costs. The increase in net sales was
partially offset by an increase in marketing spend primarily related to targeted marketing programs for Dr Pepper, Sunkist soda
and Canada Dry.
Volume (BCS) increased 1% for the year ended December 31, 2010, compared with the year ended December 31, 2009,
primarily driven by a 3% increase in Dr Pepper, primarily led by Diet and regular Dr Pepper. Crush increased 18%, primarily
driven by expanded distribution, the launch of Cherry Crush in the first quarter of 2010 and the limited time offering of the Lime
extension. These increases were partially offset by a double-digit decline in Hawaiian Punch, Squirt, and Vernors, as well as a
4% decrease in our Core 4 brands. The decrease in our Core 4 brands was primarily driven by a double-digit decline in 7UP and
Sunkist soda, which was partially offset by a high single-digit increase in Canada Dry. The decreases in 7UP, Sunkist soda,
Hawaiian Punch, Squirt, and Vernors were primarily driven by the repatriation of the brands to our Packaged Beverages segment
and transfer of concentrate sales in the Caribbean to our Latin America Beverages segment.
Packaged Beverages
The following table details our Packaged Beverages segment's net sales and SOP for 2010 and 2009 (dollars in millions):
Net sales
SOP
For the Year Ended
December 31,
2010
$ 4,098
536
2009
$ 4,111
573
Amount
Change
$(13)
(37)
Sales volumes decreased 1% for the year ended December 31, 2010, compared with the year ended December 31, 2009. The
majority of the decrease was the result of a decline in contract manufacturing, which negatively impacted total volume by
approximately 3%. The decline in contract manufacturing was partially offset by volume growth in our NCB category. Repatriation
of brands associated with the PepsiCo transaction increased total volume by 1%.
Total CSD volume was flat for the year ended December 31, 2010, compared with the year ended December 31, 2009. Volume
from the repatriation of the Vernors and Squirt brands associated with the PepsiCo transaction increased our CSD volume 1%.
Volume for our Core 4 brands decreased 1%, due to a mid single-digit decline and low single-digit declines in 7UP, A&W and
Sunkist soda, respectively. These decreases were partially offset by a double-digit increase in Canada Dry due to targeted marketing
programs. Dr Pepper volumes declined 1%.
Total NCB volume increased 6% as a result of a 12% increase in Snapple due to the successful restage of the brand, growth
of value offerings and increased marketing. Hawaiian Punch and Mott’sincreased 11% and 3%, respectively, as a result of increased
promotional activity and distribution gains.
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