Keurig Dr Pepper (KDP) has released results for Q2 2023, which shows an overall increase in sales compared to Q2 2022.
“Our second quarter results demonstrated the strength of KDP’s brand portfolio and our high-quality retail execution,” says KDP Chairman and CEO Bob Gamgort. “We saw continued momentum in the US Refreshment Beverages and International segments, as well as encouraging intraquarter developments in US Coffee, where we expect a sequential recovery in revenue and a meaningful inflection in margins in the back half.”
Net sales increased by 6.6 per cent to US$3.79 billion compared to Q2 2022. On a constant currency basis, net sales increased 6.1 per cent, reflecting net price realisation of 8.2 per cent.
Generally accepted accounting principles (GAAP) operating income increased 34.4 per cent to US$769 million, compared to US$572 million in the year-ago period, reflecting growth in gross profit, as the strong net sales growth and productivity more than offset continued input cost inflation. Also impacting the comparison was the favourable year-over-year impact of items affecting comparability.
GAAP net income for the quarter increased 130.7 per cent to US$503 million, or US$0.36 per diluted share, compared to US$218 million, or US$0.15 per diluted share, in the year-ago period. This performance reflected a favourable year-over-year impact of items affecting comparability and the increase in adjusted operating income, partially offset by a higher GAAP effective tax rate. Excluding items affecting comparability, adjusted net income for the quarter advanced 7.0 per cent to US$596 million, and adjusted diluted EPS increased 7.7 per cent to US$0.42.
Free cash flow for the second quarter was US$295 million, reflecting lower operating cash flow and higher capital expenditures versus prior year.
During the quarter, the Company repurchased approximately 7 million KDP shares at a weighted average price per share of US$32.34, totalling approximately US$226 million. The Company has approximately US$3.2 billion remaining under its share repurchase authorisation expiring on December 31, 2025.
“On a consolidated basis, we continue to drive healthy growth while reinvesting in our business and are increasingly confident in our full year outlook, which now reflects even stronger underlying EPS results,” says Gamgort.
The company’s coffee net sales for the quarter decreased 5.7 per cent to US$970 million from the last quarter, reflecting net price realisation of 1.6 per cent and a volume/mix decline of 7.3 per cent.
Revenue from the company’s coffee pods decreased by 4.6 per cent, driven by a shipment decline of 7.7 per cent.
International sales for the quarter increased 10.9 per cent to US$489 million.
For the full report, visit the company’s website.