US-based PepsiCo Inc's dependence on emerging markets continues to grow as sales in the developed markets keep falling.
The Purchase, New York-based company reported eight per cent growth in snacks volumes and four per cent in beverage volumes for the third quarter of 2011, on the back of strong performance in markets such as India. Snacks volumes grew in double-digits in West Asia, India, China and Thailand, while beverage volume growth was driven by double-digit gains in India and Saudi Arabia, Pepsi said today.
This helped the company report 13 per cent growth in net revenues for the third quarter at $17.6 billion — better than the analysts estimates. The reported net revenue growth in emerging markets was a whopping 33 per cent, said Pepsi.
The Asia, West Asia and Africa (AMEA) belt saw a 16 per cent growth in beverage volumes, while snacks volumes were up six per cent. The growth figures was second to the European region, which saw 35 per cent growth in beverage volumes and 13 per cent growth in snacks volumes. But this, said the firm, was on account of the consolidation of the acquisition of dairy and juice major Wimm-Bill-Dann (WBD), during the quarter.
Organic beverage volume growth in Europe actually declined, while snack volume growth grew by four per cent, the firm said. The scenario was no different in the Americas, where both beverage and snack volume growth was insignificant during the quarter.
Seeing the importance of emerging markets, the firm had recently announced plans to invest an additional $2.5 billion in China over the next three years, in addition to the $1 billion it had already pumped in since 2008. In India too, Pepsi has invested around $1 billion, said company officials.