US Soft Drink Sales Increased 0.5% in 2001

NEW YORK–(BUSINESS WIRE)–February 28, 2002–Carbonated soft drink sales increased a mere 0.5% in the United States in 2001, an increase of about 54 million cases over 2000, based on preliminary statistics released today from Beverage Marketing Corporation.

Although industry volume topped 10 billion cases for the fourth straight year, per capita consumption fell for the third year in a row after several decades of unabated growth. Total volume approached 10.3 billion cases. Per capita consumption dipped to 55.4 gallons in 2001 from 55.7 gallons in 2000 and 55.9 gallons in 1999.

“Intensified competition from non-carbonated beverages – especially bottled water – has contributed to slower growth for carbonated soft drinks in the last few years,” said Michael Bellas, chairman, Beverage Marketing Corporation.

Diet soft drinks outpaced regular soft drinks in 2001, thanks to strong growth by Diet Pepsi, Diet Coke and Diet Dr Pepper. Diet soft drinks grew 0.7%, while regular soft drinks grew 0.5%. Flavored soft drinks, such as orange, cherry and root beer, grew faster than colas.

Pepsi-Cola Company enjoyed relatively solid growth, with volume increasing by 1.3%. Its respectable performance in a sluggish market can be attributed to new product innovations such as Mountain Dew Code Red, lemon-flavored Pepsi Twist and its new lemon-lime, Sierra Mist. Diet Pepsi also outperformed the overall carbonated soft drink market in 2001. Pepsi-Cola’s market share edged up from 30.9% in 2000 to 31.1% in 2001.

In contrast, Coca-Cola’s volume dipped slightly and its share eroded from 44% in 2000 to 43.7% in 2001. Diet Coke volume increased by 1.7%, and newly launched Diet Coke with Lemon added 24 million cases to the company’s total volume.

As in the last several years, the leading soft drink companies experienced strong growth in non-carbonated beverages – which are counted separately from soft drink sales. Pepsi’s non-carb business, for example, grew by 35% and Coke’s enlarged by 23%.

Of the branded soft drink companies, Dr Pepper/Seven Up Inc. (DPSU), the third largest soft drink company, saw volume slip by 0.8%. The maker of brands such as Dr Pepper, 7UP and A&W lost market share, which slid from 14.4% in 2000 to 14.2% in 2001. The company acquired Royal Crown in late 2000. If RC brand volume is included, DPSU’s share stands slightly higher, but the contraction in volume is more pronounced on a pro forma basis. Cott Corporation, the leader in private label soft drinks, benefited from increased presence in growing distribution channels, such as mass merchandisers and club stores, and experienced a substantial 14% volume increase.

A comprehensive soft drink statistical report compiled by Beverage Marketing will appear in the March issue of Beverage World magazine. Statistics measure all distribution channels, including supermarkets, convenience stores, fountain and other channels of availability.

Based in New York, Beverage Marketing Corporation is the leading research, consulting and financial services firm dedicated to the global beverage industry.

                LEADING CARBONATED SOFT DRINK COMPANIES
                              2000 - 2001
                                                               Share
        Millions of 192-Oz. Cases(a) Share of Volume  % Change Change
Companies    2000       2001         2000      2001    2000/01 2000/01
---------    ----       ----         ----      ----    ------- -------
Coca-Cola
 Company    4,491.5    4,484.6      44.0%     43.7%    -0.2%    -0.3%
PepsiCo,
 Inc.       3,157.4    3,198.5      30.9%     31.1%     1.3%     0.2%
Dr Pepper/
 Seven Up   1,466.6    1,454.4      14.4%     14.2%    -0.8%    -0.2%
Cott
 Corporation  326.8      372.5       3.2%      3.6%    14.0%     0.4%
National
 Beverage     213.6      224.5       2.1%      2.2%     5.1%     0.1%
Royal
 Crown(b)     107.4       98.3       1.1%      1.0%    -8.5%    -0.1%
Big Red        26.7       27.0       0.3%      0.3%     1.3%     0.0%
Seagrams
 Mixers        25.5       30.1       0.2%      0.3%    18.3%     0.0%
Monarch        11.8       10.7       0.1%      0.1%    -9.6%     0.0%
Double
 Cola
  Company      10.3       10.2       0.1%      0.1%    -1.3%     0.0%
               ----       ----       ----      ----    -----     ----
 Subtotal   9,837.5    9,910.8      96.3%     96.5%     0.7%     0.2%
All Others    381.1      362.3       3.7%      3.5%    -4.9%    -0.2%
              -----      -----       ----      ----     -----   -----
 TOTAL     10,218.7   10,273.1     100.0%    100.0%     0.5%       --

(a) Includes diet and regular

(b) Pro forma: DPSU's parent, Cadbury Schweppes, acquired RC in
    September 2000. Source: Beverage Marketing Corporation

                 LEADING CARBONATED SOFT DRINK BRANDS
                              2000 - 2001
                                                               Share
        Millions of 192-Oz. Cases    Share of Volume  % Change Change
Brands       2000       2001         2000      2001    2000/01 2000/01
------       -----      ----         ----      ----    ------- -------
Coca-Cola
 Classic    2,070.9    2,029.5      20.3%     19.8%    -2.0%     -0.5
Pepsi       1,423.0    1,383.2      13.9%     13.5%    -2.8%     -0.5
Diet Coke     881.8      896.8       8.6%      8.7%     1.7%      0.1
Mountain
 Dew          719.8      691.5       7.0%      6.7%    -3.9%     -0.3
Sprite        668.1      656.0       6.5%      6.4%    -1.8%     -0.2
Dr Pepper     627.9      617.0       6.1%      6.0%    -1.7%     -0.1
Diet Pepsi    500.5      510.5       4.9%      5.0%     2.0%      0.1
Seven-Up      203.4      189.2       2.0%      1.8%    -7.0%     -0.1
Caffeine Free
 Diet Coke    175.5      173.8       1.7%      1.7%    -1.0%      0.0
Minute Maid
 Reg. & Diet  150.7      146.2       1.5%      1.4%    -3.0%     -0.1
              -----      -----       ----      ----    -----     ----
 Subtotal   7,421.7    7,293.7      72.6%     71.0%    -1.7%     -1.6
All Others  2,797.0    2,979.4      27.4%     29.0%     6.5%      1.6
            -------    -------      -----     -----     ----      ---
 TOTAL     10,218.7   10,273.1     100.0%    100.0%     0.5%       --

    Source: Beverage Marketing Corporation

Contact:

Beverage Marketing Corporation, New York
Gary A. Hemphill, 212/688-7640