Coca-Cola
Coca-Cola Demonstrates Its Pricing Power in Q1 2022
In its most recent quarterly earnings release, Coca-Cola posted organic sales growth of 18 percent, including an eight percent jump in underlying unit case volume. Concentrate sales were up 11 percent, with price/mix up seven percent. CEO James Quincey doesn’t believe the consumer will keep taking pricing hits, but the company will continue to raise prices if costs keep rising. Margins held up: reported gross margin was just 10 basis points down on Q1 2021 at 61.0 percent. Operating margin was up 2.3 points, and up 40 basis points on an adjusted non-GAAP basis. One more immediate area of concern for the company is the continued pressure on out-of-homes sales from COVID fears and restrictions in some markets, especially in China and Asia-Pacific more widely.
Keurig Dr Pepper
Keurig Dr Pepper Set To Look Beyond Organic Growth
KDP said it was once again ready to start to look for inorganic growth opportunities, such as M&A and partnerships. CEO Bob Gamgort said there are three main types of opportunity. The first is partnerships that don’t involve a change in ownership, such as its deal with Community Coffee. The second is seed investments, like its minority stake in Tractor Beverage, a certified organic, non-GMO beverage solution for foodservice. Thirdly, KDP is looking at mid-scale and larger M&A opportunities but remains wary of overpaying. To accommodate this anticipated growth, it is preparing the business to scale, by building out capacity in its management team; investing distribution capabilities, including in foodservice and direct store delivery; and looking at how best to support e-commerce growth, and acknowledging that shipping liquids by courier “is not a great business model over the long term.”
KDP Posts Strong First Quarter Growth
Keurig Dr Pepper delivered 6.1 percent net sales growth in the first quarter of 2022, from “strong growth” in packaged beverages, beverage concentrates and Latin America beverages. Packaged beverages grew sales by 13.2 percent, but coffee systems sales were down 4.3 percent on supply chain problems. Latin America beverage sales were 16.8 percent up and beverage concentrates up 9.5 percent. The sales growth helped GAAP operating income grow 51 percent. Chairman and CEO, Bob Gamgort, said the results reflect “the power of our brand portfolio and the quality of our execution at retail”, and that margins were hit by accelerating inflation, which “outpaced the timing of pricing actions.” He added that KDP “implemented additional pricing actions across most categories,” which should help the company deliver high-single-digit net sales growth over the year.
Nestle
Nestlé’s Nespresso Unit Gets B Corp Certification
Nespresso has announced global certification as a B Corp, joining around 4,500 other businesses demonstrating social and environmental responsibility and transparency. The achievement was possible through a “unique approach to coffee sourcing” - the Nespresso AAA Sustainable Quality™ Program – a strategic alliance with Fairtrade and its global recycling scheme for aluminum capsules. Nespresso will put the B Corp logo on its products and communications
Nestlé And Starbucks Launch Non-Dairy Coffee Enhancers In Canada
The two brands announced the launch of two new non-dairy Starbucks® Coffee Enhancers. The two flavors are Caramel Macchiato and Hazelnut Latte and are the first dairy-free flavors in the range. They are made with almonds and oats and can be bought in the chilled aisles. The launch builds on the dairy-based range of Starbucks® Coffee at Home Coffee Enhancers introduced to Canada last year: Caramel Macchiato, Cinnamon Dolce and White Chocolate Mocha.
Other Companies
Lavazza Unveils Organic RTD Cold Brew Cans
Ready-to-drink cold brew coffee options now include dairy and non-dairy options from Lavazza: Classic Cold Brew, Nitro Cold Brew, Cappuccino Cold Brew with Milk, and Double Shot Cold Brew with Oat Milk. The brand said the range is the only one of its kind made with USDA Certified Organic, Rainforest Alliance Certified and 100% Arabica coffee. It hopes to attract the younger American coffee drinkers’ preference for cold and iced coffee, which growing almost 40 percent faster than packaged coffee. The cans include distinctive and iconic images of Italian cities and regions.
Lemon Perfect Raises $31 Million, With Beyoncé Among The Investors
Beyoncé Knowles-Carter was one of the investors in a $31 million Series A funding round for lemon water brand Lemon Perfect that will be used to more than double distribution to 40,000 points by the end of 2022. The brand claims each bottle contains the juice of half of an organic lemon and 100% of the daily value of vitamin C, and there’s no sugar, with erythritol and stevia used for sweetening. It also claims health benefits, such as a stronger immune system, a non-caffeine energy boost, and digestive benefits. Lemon Perfect’s 2020 seed round also involved celebrities, including athletes.
Remilk Plans To Build World’s Largest Dairy-Free Production Facility In Denmark
Israeli start-up Remilk will build a precision fermentation facility in Kalundborg, Denmark to leverage the yeast-based fermentation process it has developed to produce “dairy-identical” milk proteins. The site will have capacity to make non-animal dairy protein for cheese, yogurt and ice cream equivalent to the volume produced by 50,000 cows. The partnership with the city of Kalundborg, Invest in Denmark, the Danish embassy in Israel and the Israeli embassy in Denmark, comes after the January Series B funding round that raised $120 million. It expects the investment will help it achieve $600 million in sales by 2026.
Weetabix Reprises Limited Edition Caffé Latte On The Go Drinks Flavor
On The Go breakfast drink from Weetabix in the U.K. is re-introducing the Caffé Latte limited edition variant for the summer following an its inaugural run in 2021. It will be sold in wholesale and convenience stores. The brand is aiming to appeal beyond the usual millennials and Gen Z groups that are the typical chilled coffee drinks consumers and seeks to build on the growth in the chilled coffee category generally.
University Of Iowa Research Supports C4 Smart Energy Benefit Claims
C4 Energy brand owner, Nutrabolt, said a new study into the benefits of C4 Smart Energy demonstrates the brand’s better-for-you and cognitive performance claims. The University of Iowa study looked at the products’ blend of ingredients: InnovaTea®, a plant-based caffeine ingredient from green tea extract; and Cognizin®, a patented citicoline for mental focus, attention and recall. The results come as the range announced a new variant, Watermelon Burst. The research found a 47 percent improvement in complex gaming performance; 33 percent improvement in energy levels; 16 percent improvement in short-term recall and information processing; 10 percent improvement in concentration; and 10 percent improvement in mental multi-tasking. The study was undertaken on male and female gamers who “weren't naive to energy drinks", according to a co-investigator in the study. The Watermelon Burst flavor is sold in 16-ounce cans online at C4Energy.com and Amazon, and at around 20,000 points at retailers like Vitamin Shoppe, H-E-B, 7-11 and Giant Eagle.
New Functional Squash Range From Robinsons Hits The Shelves
Robinsons has brought to market a vitamin-enhanced on-the-go squash line, called Benefit Drops, with four flavors: Vitality (Peach, Mango & Passion Fruit with added vitamin B3); Immunity (Orange & Guava flavor with added vitamin C); Boost (Raspberry, Strawberry & Acai with added B6); and Focus (Lemon, Lime & Ginseng with added B3 and Zinc). Robinsons wants retailers to sell the range from clip-strips in front-of-store fridges.
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