Varun Beverages of India posted a second-quarter profit that above market forecasts on Tuesday, as cost-cutting initiatives helped offset weak bottled beverage sales caused by early monsoon rains. April-June is often a solid quarter for packaged beverage manufacturers, as India’s summer boosts demand for cold beverages. However, this year, monsoon rains arrived early, lowering temperatures. Consolidated volumes fell 3% in the reported quarter owing to “abnormally high” rainfall in India, according to the business, which is one of PepsiCo’s largest bottling partners outside of the US. Domestic volumes fell 7% for PepsiCo’s bottler. Revenues also decreased 2.3%. However, the company strengthened its control over expenses. Expenses were lowered by roughly 4% year over year.
Net profit increased by 5% year on year to ₹13.17 billion ($151.7 million), above analysts’ forecast of ₹11.30 billion, according to LSEG statistics. Pankaj Madan has also been selected as the firm’s new finance director. Varun drinks packages and sells drinks under the Pepsi and Tropicana names, among others. It also offers beverages under its own trademarks, such as “Jive” and “Cream Bell”. The firm, which operates in around ten countries, has been growing throughout Africa, claiming great development prospects in emerging markets. Varun Beverages’ shares were last trading 1.4% higher after the results.
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