Romania�s weak economic performance sends PepsiAmericas� third-quarter sales down 9.3%

PepsiAmericas reported a 9.3% decline in sales volume for its operations in Central and Eastern Europe, and third-quarter revenues down to $63.5 million. The economic recession that impacted Romania has left a major imprint on the bottler’s third-quarter results, according to the chief executive of the company, Robert Pholad.

Results were also negatively impacted by foreign currency movements, which reduced net income by $38 million, the financial report released by the company.

"Given the challenges in our European business and volume pressures in the U.S., we are satisfied with our performance this quarter. We continue to execute our global pricing plans, expand our brand portfolio and drive productivity improvements, helping to offset topline pressures and currency headwinds. If in the U.S., our take home business was particularly soft while pricing, productivity and cost management drove operating profits up 7 percent in the quarter, while in Europe, the weaker economic trends in Romania negatively impacted revenues and operating profits in the quarter, while volumes sequentially improved in all other markets,” said Robert Pholad (photo).

The bottler said its CEE net sales fell 27% to $279 million, weighed down by currency instability. Sales volume sank 9.3%, which reflects the economic pressures that emerging markets have come under, especially Romania.

PepsiAmericas Inc is the world’s second largest soft-drink bottler, and operates brands such as Pepsi, Pepsi Max, Pepsi Light, Mountain Dew, Mirinda, 7up, Lipton Ice Tea and Gatorade. With revenues of $4.9 bln in 2008, PepsiAmericas employs over 20,000 people around the world and operates around 33 bottling units and over 185 distribution centers.

PepsiAmericas serves a major section of United States, Central and Eastern Europe (Ukraine, Poland, Romania, Hungary, Czech Republic, and Slovakia) and the Caribbean.

PepsiAmericas operates in Romania through Quadrant Amroq Beverages (QAB), the authorized bottler and distributor of Pepsi, Pepsi Max, Pepsi Light, Mountain Dew, Mirinda, 7up, Prigat, Lipton, Ice Tea, Gatorade, and Roua Muntilor for Romania and Moldova.

PepsiAmericas Romania reported last year revenues of 744,806,819 lei (€202.3 million), up 12.5% from 651,066,417 lei (€195.5 million) in 2007. The company refused to disclose further details on its third-quarter performance.

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