(Reuters) -India’s Varun Beverages reported second-quarter profit above market expectations on Tuesday, as cost control measures helped offset damp bottled beverage sales exacerbated by early monsoon rains.
April-June is usually a strong quarter for packaged beverage makers, as India’s summer drives up demand for cold drinks. But this year, monsoon rains arrived early, cooling temperatures.
Consolidated volumes dropped 3% in the reported quarter, due to “abnormally high” rainfall in India, the company, one of PepsiCo’s biggest bottling partners outside the United States, said.
Domestic volumes declined 7% for the PepsiCo bottler. Revenues also fell 2.3%.
However, the firm tightened its grip on costs. Expenses were down nearly 4% on-year.
That led net profit to rise 5% on-year to 13.17 billion rupees ($151.7 million) and above analysts’ average expectation of 11.30 billion rupees, as per data compiled by LSEG.
The firm also named Pankaj Madan as its new finance boss.
Varun Beverages packages and distributes beverages under Pepsi and Tropicana labels, among others. It also sells beverages under its own brands such as “Jive” and “Cream Bell”.
The company, which operates in about 10 countries, has been expanding in Africa, citing strong growth opportunities in emerging markets.
Shares of Varun Beverages were last trading 1.4% higher after results.
($1 = 86.8100 Indian rupees)
(Reporting by Hritam Mukherjee and Aleef Jahan in Bengaluru; Editing by Harikrishnan Nair)
