- Keurig Dr Pepper Inc KDP reported second-quarter FY21 sales growth of 9.6% year-on-year, to $3.14 billion, beating the analyst consensus of $3.05 billion.
- The revenue increase was driven by growth in each business segment, with Beverage Concentrates and Latin America Beverages posting double-digit growth.
- On a constant currency basis, net sales advanced 8.1%, reflecting a higher volume/mix of 6.1% and a favourable net price realization of 2.0%.
- Sales for coffee systems rose 5.6% Y/Y to $1.10 billion, and packaged beverages increased 7.6% to $1.50 billion.
- Gross profit for the quarter increased 13.3% Y/Y to $1.8 billion.
- Selling, general and administrative expenses expanded 3.8% Y/Y to $1.03 billion.
- Adjusted operating income grew 8.3% to $839 million, and adjusted operating margin contracted 40 bps to 26.7%, reflecting the sharp increase in marketing investment and the impact of inflation.
- The GAAP operating margin was 23.4%, and operating income for the quarter rose 30.8% to $734 million.
- The company held $167 million in cash and equivalents as of June 30, 2021.
- Adjusted EPS of $0.38 beat the analyst consensus of $0.37.
- "Notwithstanding the expectation for ongoing challenges to persist for some time, we are confident in our strengthened top-line outlook and plan to reinvest any profit upside back into the business," said Chairman and CEO Bob Gamgort.
- Outlook: Keurig raised FY21 constant currency net sales growth outlook to 6% - 7% from the previous 4% - 6%.
- The company reaffirmed its guidance for adjusted EPS growth of 13%- 15%.
- Price action: KDP shares are trading lower by 0.51% at $35.13 on the last check Thursday.
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