Mr. Stump: As a whole, results were fairly solid for the beverage group during the first half. Obviously, soft drink volumes continued to decline, but we still saw strong double-digit growth in most non-carbonated categories, led by energy drinks and bottled water. Overall beverage category volume growth in the low single digits therefore came in line with expectations.
TWST: Why the ongoing decline in the carbonated segments?
Mr. Stump: I think more than anything else we are just seeing a continued shift
of consumer preference away from soft drinks and toward non-carbonated drinks.
The overall liquid beverage consumption numbers have stayed about the same,
which is in the 2% to 3% growth range per year. We are just simply now seeing
more consumers buying non-carbonated drinks versus soft drinks.
TWST: Is that an ongoing pattern?
Mr. Stump: Yes. In order to respond to that trend, companies continue to shift
more time and money into new product and promotions around non-carb offerings. I
think we will see that trend continue into the foreseeable future.
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