Keurig Dr Pepper reports 3.6% sales growth in 2024, driven by U.S. Refreshment Beverages
USA – Keurig Dr Pepper Inc. (KDP) has reported a 3.6% increase in net sales to US$15.4 billion for the full year 2024, driven by strong performance in the U.S. Refreshment Beverages and International segments.
On a constant currency basis, net sales grew 3.9%, supported by volume/mix growth of 2.7% and a favorable net price realization of 1.2%.
The U.S. Refreshment Beverages segment led the company’s growth, with net sales rising 5.8% to US$9.3 billion. This was attributed to a 3.1% increase in net pricing and a 2.7% boost in volume/mix.
However, the U.S. coffee segment faced a 2.4% decline in net sales due to pricing challenges and competitive pressures, while adjusted operating income in the segment dropped 5.7%.
The international segment posted a modest 0.8% increase in net sales, but when adjusted for currency fluctuations, growth stood at 8.5%.
Despite this revenue increase, adjusted operating income in the segment fell 8.6%, reflecting inflationary costs and higher selling, general, and administrative expenses (SG&A).
CEO Tim Cofer highlighted the company’s progress, stating, “In 2024, we delivered strong financial performance consistent with our long-term algorithm and advanced our strategy to lay the groundwork for KDP’s next phase of growth.
We gained market share through exciting innovation, marketing, and activation across our CSD and coffee brands, drove win-win outcomes with partner brands such as Electrolit and C4, and took bold action to extend our portfolio and route to market with the acquisition of GHOST and select territory expansions.”
In the fourth quarter, net sales rose 5.2% to US$4.1 billion, or 6.2% on a constant currency basis. This growth was driven by a 5.3% increase in volume/mix and a 0.9% increase in pricing.
However, the quarter also saw a US$718 million impairment charge, primarily affecting the Snapple brand.
Free cash flow surged 380.4% year-over-year to US$687 million, significantly improving financial liquidity. Adjusted operating income increased 8.6% to US$774 million, representing 31.7% of net sales.
Growth was supported by net sales expansion and productivity savings but was partially offset by inflationary pressures and a larger earned C4 performance incentive from the previous year.
For 2025, KDP expects mid-single-digit net sales growth and high-single-digit adjusted diluted EPS growth on a constant currency basis, incorporating contributions from the recent GHOST acquisition.
Foreign currency translation is projected to be a one to two percentage point headwind to full-year growth.
The company plans to invest in product innovation and market penetration, particularly in international markets. Planned pricing adjustments in the U.S. coffee segment aim to counter inflation-driven margin pressures.
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