Pepsi-Cola allots P2 billion for capital expenditures

MANILA, Philippines - Pepsi-Cola Products Philippines Inc. is allotting up to P2 billion for capital expenditures for its fiscal year ending June 2010 to beef up capacity and launch new products to further strengthen its foothold in the beverage sector.

On the sidelines of the company’s annual stockholders meeting yesterday, Pepsi chairman and chief executive officer Micky Yong said the company is spending an additional P500 million to its yearly annual capex of P1.5 billion to further expand its reach, particularly in Mindanao.

The expansion would provide an additional six million cases of non-carbonated and carbonated drinks to Pepsi’s existing volume of 170 million cases a year, which would ensure sufficient growth for the company over the next five years.

Yong said the company plans to further grow its non-carbonated beverage line through acquisitions.

He said the firm now holds 18 percent and 25 percent of the carbonated and non-carbonated beverage markets, respectively.

Despite a tough business environment, Yong is confident that the company would post growth in its top line for its fiscal year 2010 but didn’t say by how much. 

Majority owned by the Guoco Group and US-based PepsiCo. Inc., Pepsi posted a net profit of P799.69 million last year, up five percent from the previous year’s P760.7 million. Net sales rose 9.6 percent while operating income grew 19 percent to P1.1 billion.

Pepsi is a licensed bottler of PepsiCo beverages in the Philippines, manufacturing a range of carbonated softdrinks and non-carbonated drinks that include brands such as Pepsi, Diet Pepsi, Pepsi Max, 7Up, Diet 7Up, Mountain Dew, Gatorade, Lipton Iced Tea, Tropicana, Propel and Sting.