Twellium Industrial Company, West Africa’s fastest-growing manufacturing company, has partnered with Sidel to develop a new ultra-modern facility in Kumasi, Ghana – a greenfield project housing two complete PET packaging lines for still and carbonated beverages.
Twellium Industrial Company (Twellium) specialises in the production of non-alcoholic beverages, including its flagship product, Verna Mineral Water. The company also manufactures signature brands such as Rush Energy Drink, Original American Cola, Planet Range, and Bubble Up Lemon Lime under licence from Monarch Beverage Company.
Twellium already operates two well-established production facilities in Accra, Ghana and Bobo-Dioulasso, Burkina Faso, and has now commissioned its third ultra-modern site in Kumasi, Ghana.
The Kumasi site began as a greenfield project, with Twellium constructing it entirely from the ground up. This included all civil works, infrastructure, and utilities, with Sidel assisting in the installation of two cutting-edge processing and packaging lines.
Cutting-edge PET packaging lines
At the Kumasi site, diversity in manufacturing—utilising different sizes of PET bottles, as well as producing a variety of beverages including water, carbonated soft drinks (CSD), non-carbonated drinks, and energy drinks—was crucial to its development. This enabled flexibility in production and catered to broad market demand.
Twellium’s Kumasi site now features Africa’s fastest complete PET water line, with a production output of 80,000 bottles per hour, utilising Sidel’s signature Combi solution which combines blow moulding, filling, and capping into a single, compact, and integrated solution.
The set-up also includes a state-of-the-art water treatment room and automated cleaning-in-place (CIP) system, ensuring the highest levels of hygiene and food safety.
Sidel has also installed a complete line for carbonated soft drinks (CSD) at the Kumasi plant. Capable of bottling at speeds of 65,000 bottles per hour, this high-speed line with a Sidel Combi was the perfect solution for Twellium to meet the region’s booming CSD market.
As part of the project, Sidel also installed a customised EvoDECO Roll-Fed labeller featuring an integrated system which enables the application of QR codes on the bottle cap, allowing maximum traceability and meeting Ghanaian regulations.
Leader in Ghana’s thriving beverage industry
“Sidel’s complete PET packaging lines for Twellium ensure that beverage production volume meets affordability, allowing us to keep up with the constant increase in demand. This partnership not only drives efficiency but also creates more regional job opportunities, reinforcing Twellium as a proud leader in Ghana’s thriving beverage industry,” comments Ali Ajami, Twellium Marketing Director.
The Danish brewery Carlsberg is buying the British soft drinks manufacturer Britvic for the equivalent of 3.9 billion Euro. The Carlsberg Group plans to transform Britvic into an integrated beverage company called Carlsberg Britvic.
The takeover is intended to promote Carlsberg’s growth in Western Europe and achieve annual cost savings of the equivalent of a good 118 million Euro.
Royal Unibrew A/S announced the closing of the acquisition of Vrumona, the second largest soft drink company in the Netherlands, from Heineken. Vrumona is located near Utrecht and employs more than 300 people. The company has a strong portfolio of own brands and partner brands supporting the health and sustainability agenda.
Lars Jensen, CEO of Royal Unibrew A/S, states: “I am happy to welcome the dedicated and talented people from Vrumona to the Royal Unibrew family. We are eager to onboard the strong organisation and get started on the exiting journey to establish the company as a multi-beverage platform in Central Europe that will deliver organic earnings growth for years to come.”
As previously announced, Royal Unibrew A/S is acquiring 100 % of Vrumona at an enterprise value of EUR 300 million on a debt free basis. In 2022, Vrumona realised net revenue of EUR 200 million and an EBITDA of around EUR 25 million, resulting in an acquisition multiple (EV/EBITDA) of 12x.
The acquisition is expected to be EPS accretive in 2024, and ROIC on the acquisition is expected to exceed WACC within three years.
Vrumona fits very well into Royal Unibrew A/S’ operating model of strong local businesses with strong local brands with its solid positions in On-Trade and Off-Trade. The company has been a front runner in creating healthy and functional beverages for years for which reason the majority of its business is within the no/low sugar and calories segment. With the acquisition, Royal Unibrew A/S establish a new growth platform and expand its geographical footprint while the company also expand its longstanding relationship with PepsiCo as Vrumona is operating the full beverage portfolio from PepsiCo on a license agreement in a partnership dating back to 1949.
The Vrumona production facility in Bunnik includes seven lines with a current annual output of around 3.1 million hectoliters. The production facility is in a good condition; however, additional long-term investments are needed to improve efficiency as well as to expand capabilities and capacities. It is therefore expected that it will take some years before the platform is able to exploit its full organic growth potential.
By Peter Harding, President of UNESDA Soft Drinks Europe and CEO of Suntory Beverage & Food Europe
The EU is set to move towards a circular economy for beverage packaging. In just a couple of weeks, Members of the Environment Committee in the European Parliament will vote on their amendments to the EU Packaging and Packaging Waste Regulation (PPWR). In parallel, EU Member States are working towards adopting their position on this file by the end of the year. Among the key areas of attention in the PPWR is reuse and refill. It is absolutely critical that MEPs and Member States support sound measures that ensure that recycling, reuse and refill are complementary solutions, and reject proposals to increase the reuse and refill targets without further assessment of their environmental, economic and social impacts.
The EU is taking a leadership role in driving circularity and the PPWR is among the most ambitious EU policies in this regard. The European soft drinks sector, represented by UNESDA Soft Drinks Europe, supports the goals to better reduce, collect, recycle and reuse beverage packaging. We have already shown that we take bold voluntary actions to contribute to accelerating the green transition in Europe through our commitment to making our soft drinks packaging fully circular by 2030.
Our sector also supports reuse and refill systems as part of the solution to reduce packaging and packaging waste. We are already investing in these systems as a complementary action to our ongoing efforts to reduce and recycle our packaging.
It is fundamental that recycling and reusable systems are complementary solutions and MEPs and Member States should enshrine this in the PPWR. How?
Key ask 1 – Do not increase the reuse and refill targets (Art. 26) without further impact assessment
The European Commission’s impact assessment has been heavily criticised by many stakeholders, including our sector, over the last 9 months. The lack of a proper environmental and economic assessment of the implications of the reuse and refill targets proposed by the European Commission in the PPWR is worrying as legislation should always be developed on the basis of clear and granular data on the costs and benefits of the measures being proposed. So, first things first: the only way to assess the real impact of scaling up reusable systems across the EU is to thoroughly analyse the costs and benefits of setting up these systems in different Member States, different sectors and different distribution channels. As an example, the shift to 10% refillable PET as of 2030 in the EU is estimated to cost more than €16 billion, according to a PwC study.
It is very concerning to see proposals for increased reuse and refill targets for 2030 and 2040 that are not based on any further impact assessment that justifies them. Why forcing beverage manufacturers, of which a majority are SMEs, to make huge investments in reuse and refill systems in geographies or channels where existing well-functioning single-use systems make more sense from an environmental and economic perspective?
In our view, the proposed targets are already extremely challenging and therefore the focus now has to be on providing manufacturers with the necessary enablers and the flexibility to invest in the best packaging mix.
Key ask 2 – Maintain systems enabling refill in the reuse and refill targets (Art. 26)
We are all familiar with the traditional returnable refillable bottle, whereby the consumer buys a beverage bottle in a store and brings it back to the retailer for it to be refilled. This is not, however, the only system to reuse and refill – and it is not always the best solution from an environmental perspective. Asking beverage manufacturers to focus all their investment and innovation only in reuse on traditional returnable refillable bottles takes no account of consumer patterns of shopping and consuming beverages, and stifles the innovative solutions that open up possibilities to match consumers to more sustainable purchasing habits.
Today, there are several innovative reusable solutions that are convenient for consumers, are responding to new consumption habits and are helping reduce packaging as they use little to no packaging, such as home soda dispensers and refill stations in stores and horeca. Why, then, aren’t these at-home and on-the-go solutions, which are recognised by the Ellen MacArthur Foundation as reuse models, counting towards the achievement of the reuse and refill targets? It makes all sense to consider them for the attainment of the reuse and refill targets. The PPWR should secure a future for these innovative refill solutions and the EU co-legislators should therefore support a broad definition of reuse and refill that includes the whole spectrum of available reusable and refill models.
Key ask 3 – Create well-designed exemptions to ensure reusable packaging is only used where and when it makes the most sense
It is essential to make sure that reusable packaging is only introduced where it makes sense from an environmental, economic and consumer perspective. To enable it, the PPWR should provide a form of exemption if certain environmental criteria are met in order to avoid unintended adverse effects of the reuse and refill targets.
Some amendments tabled in the different European Parliament’s committees involved on this file can serve as a positive source of inspiration as they recognise the role of existing well-functioning circular systems. For example, many countries are investing in achieving 90% collection of PET bottles and aluminium cans through the introduction of Deposit and Return Systems (DRS). Let’s encourage these investments!
Now is the moment for the European Parliament and EU Member States to make the PPWR more supportive and more realistic. Our sector will remain constructive and engaged with all stakeholders to help create a stable and enabling policy environment.
The World Health Organization (WHO) and the UN Food and Agriculture Organization (FAO) have re-affirmed that aspartame is safe. UNESDA Soft Drinks Europe applauds the conclusions of the new, comprehensive safety review of aspartame by the WHO/ FAO Joint Expert Committee on Food Additives (JECFA), the world’s leading food safety body for additives.
Commenting on the release of the WHO/FAO JECFA review of aspartame, Nicholas Hodac, director general of UNESDA, stated:
“Once again, aspartame is assessed as safe by the world’s leading authority on food safety, based on a rigorous review of high-quality evidence. The WHO/FAO JECFA definitive conclusion is of great importance. It strengthens public confidence in the safety of aspartame and will help consumers make well-informed food and beverage choices.’’
Mr. Hodac added: ‘’This WHO/FAO conclusion is also key in further supporting our sector’s sugar reduction efforts. For decades, we have been reducing the average sugar content in our soft drinks, largely through the use of low- and no-calorie sweeteners, such as aspartame. To make further progress in encouraging consumers towards more balanced diets, the continued support of public health authorities on the use of aspartame and other sweeteners is essential.’’
Commenting on the opinion issued by the International Agency for Research on Cancer (IARC), Mr. Hodac said: “IARC is not a food safety body. It has classified aspartame, pickled vegetables and working at night as possibly carcinogenic. The fundamental aspect to consider is the potential risk on human health, which is what WHO/FAO JECFA has assessed with the conclusion that aspartame is safe.”
The WHO/FAO JECFA review of aspartame reiterates similar findings determining the safety of aspartame by over 90 food safety agencies around the world, including the European Food Safety Authority (EFSA) and the US Food and Drug Administration (FDA).
As Chinese consumers are more focused on healthier beverages compared to their US counterparts, the country is witnessing a significant rise in consumer low-calorie soft drinks. Low-calorie soft drinks volumes increased at a triple-digit rate in China between 2019-2022, while the volumes grew by only 10 % in the US, finds GlobalData, a leading data and analytics company.
Global Data forecasts that in China, the volumes of low-calorie beverages will record a positive growth rate of 11.3 % in 2023, while in the US, it will be 2.2 %, albeit the US soft drinks market is much more mature and developed. The low-calorie market share in the soft drinks sector was 17 % in the US in 2022, while it was 2.4 % in China.
Dragos Dumitrachi, Consumer Analyst at GlobalData, comments: The carbonates category is the biggest winner regarding the growth of low-calorie beverages. Major brands such as Coca-Cola and Pepsi are continuing to invest in low-calorie variants and the trend is picking up globally. In China, low-calorie volumes are forecast to increase by 13.1 % in 2023, while the US will record a minimal 1.5 % rise in volume. “Since 2019, boosted by the COVID-19 pandemic, the health trend in the soft drinks sector has accelerated across the globe. In 2022, the world saw China and the US clash on multiple fronts. In the soft drinks consumer market, a similar opposing evolution scenario is taking place between the two countries.”
The carbonates category is the biggest winner regarding the growth of low-calorie beverages. Major brands such as Coca-Cola and Pepsi are continuing to invest in low-calorie variants and the trend is picking up globally. In China, low-calorie volumes are forecast to increase by 13.1 % in 2023, while the US will record a minimal 1.5 % rise in volume.
According to a recent GlobalData consumer survey*, when asked which feature consumers are actively looking for when making a purchase, a significantly higher proportion of Chinese consumers (49 %) said it is essential for the product to be good for physical fitness/health, while in the US, only 29 % find it essential.
Dumitrachi concludes: “This data shows that since the outbreak of the pandemic, whilst both markets show a high level of innovation towards low-calorie launches, Chinese consumers are more concerned about making informed health decisions within the beverage space in comparison to US consumers. Manufacturers in China and the US are set to increase the number of launches to capitalise on this trend throughout 2023.”
*GlobalData Q3 2022 Consumer Survey – China consisted of 532 respondents
Leading branded soft drinks business, Britvic is joining forces with University of Cambridge-backed tech company Xampla in a GBP 1 million packaging innovation partnership.
After 15 years of Cambridge research, Xampla has developed the world’s first plant protein material for commercial use. This revolutionary material uses pea protein to make microscopic capsules that protect vitamins within liquid, stopping them from being broken down by sunlight.
Xampla’s work has seen the company secure GBP 1 million in funding from the UK Government’s innovation agency, Innovate UK, to scale up the technology and material processing.
The innovation is critical to delivering drinks fortified with vitamins in clear plastic bottles. Clear plastic bottles are considered a positive by consumers, with Britvic’s research showing that people are 40 % more likely to recycle clear bottles over coloured ones. However, the downside of clear bottles is that they let more UV rays in, losing the necessary protection for vitamin D.
Simon Hombersley, CEO of Xampla, said: “We are delighted to be partnering with Britvic to deliver innovation that will revolutionise the drinks industry and it is extremely exciting to see what our material can do at scale. Xampla works with businesses to help solve their biggest problems while also enabling customers to meet their sustainability goals.
“Britvic has a proud history of fortifying its products with vitamins and seeking sustainability in its packaging. Our partnership is about helping to do both even more effectively. We can’t wait to get started.”
Last year, major Britvic brands Fruit Shoot and 7UP made the shift to clear bottles to drive up recycling rates and Britvic has started to add vitamins B, C and D to Robinsons Fruit & Barley.
Meanwhile, leading Irish squash brand MiWadi 0 % Sugar contains vitamins B, D and zinc and children’s favourite Fruit Shoot has been fortified with multivitamins since 2016. Added vitamins C and D help support the immune system and the growth of strong bones, while B vitamins contribute to energy release.
Sarah Webster, Director of Sustainable Business at Britvic, said: “Our work with Xampla supports our Healthier People, Healthier Planet strategy.
“By agreeing this GBP 1 million partnership with each other, we have shown the power of collaboration between established players and cutting-edge innovators to deliver Healthier People and Healthier Planet.
“Xampla technology has the makings of a ‘win-win’, enabling delivery of greater nutritional value in the drinks people love, while ensuring that more products can come to market in clear, recyclable bottles.”
Britvic has a long history of fortifying drinks with vitamins. The FTSE 250 company started life in 1845 as The British Vitamin Product Company, with a mission to provide customers with an affordable source of nutrition. The company is committed to a programme to reduce unnecessary plastic and is working with Xampla through an Innovate UK-backed grant to develop new formats for delivery of soft drinks and nutrients within drinks.
News of the Britvic partnership follows a successful Xampla world first product launch with meal kit manufacturer Gousto last year, where Xampla created an edible film to be used as wrapping for stock cubes. The trial kits – for making an Indian Spiced Carrot & Lentil soup recipe – sold out within one hour of going on sale.
About Xampla Xampla is a spin-out from the University of Cambridge. Its Supramolecular Engineered Protein has been developed over the past 15 years. It has created the world’s first plant protein material for commercial use. Its material performs like synthetic polymers, but decomposes naturally and fully without harming the environment. Xampla is the first UK University spin-out to be awarded B Corp status.
The non-alcoholic drinks sector recorded a compound annual growth rate (CAGR) of 0.9 %* between 2015 and 2020. Producers have seen a challenging landscape in recent years, battling rising costs, sugar taxes, packaging legislations and, of course, the COVID-19 pandemic. This resulted in global efforts to reduce calorie and sugar content in product ranges, as well as develop ‘novel’ flavors, to attract consumer attention, writes GlobalData, a leading data and analytics company.
Holly Inglis, Beverages Analyst at GlobalData, comments: “Beverage flavors are arguably the most important factor in determining consumer purchasing decisions, with 29 %** of global consumers stating they would happily try a new drink flavor out of simple curiosity. This highlights huge incentive for producers such as Coca-Cola, Nestlé, Unilever and PepsiCo to launch new product developments – and reinforces soft drinks as a fast paced, innovative industry.”
Inglis highlights the top five flavor launches in 2021 so far that are shaping the global soft drinks landscape:
Going ‘green’ with hemp and CBD
“Hemp and CBD infused drinks are continuing to garner interest, with products such as Trader Joe’s non-dairy hemp beverage in the US and Sonnenstar hemp juice shot in Austria. While hemp and CBD are positively received by a third and fifth of global consumers respectively, GlobalData’s survey indicates that a considerable portion are still unfamiliar with the ingredients – producers must address this to ensure the longevity of their hemp- or CBD-infused launches.”
Mango, let’s go
“Mango flavored drinks have emerged in Romania and Singapore, though a flurry of innovations with flavor combinations that incorporate mango have been observed in the US, UK and France. In the US, PepsiCo’s Bubly Bounce product tags no calories or sweeteners and is a carbonated water brand combining grapefruit, mango orange and passionfruit aromas.”
Isn’t that just peachy
“Peach-based products such as Lipton’s peach tea with honey, and Badoit’s peach flavored sparkling flavored water in France both tag either low calorie or low sugar bases, reinforcing positive brand connotations, and favorable views on peach as a flavor base.”
Ginger spice and everything nice
“Ginger, on the other hand, has been integrated across parts of the globe such as Nigeria, South Korea and Peru, in line with consumers opting for products that promote digestive health and wellness claims. In fact, 78 %** of global consumers believe that ginger has a positive impact on their health, reinforcing those links to health/wellness, and promoting manufacturer opportunity to innovate in line with consumer trends.”
It’s ‘grape’ to be back
“Interestingly, grape-based products have also made an appearance in 2021, which is fighting off current stereotypes of grape flavored beverages being high in sugar and bad for health, especially in parts of West Europe where they have less-than-favorable links to low quality. A notable launch in Brazil from EBBA tackles this narrative via its grape nectar, which is claimed to have no added sugar.”
Inglis concludes: “What can be seen in the soft drinks landscape is the development of several unique flavor launches, all of which apply to varying consumer trends across the globe. Health and wellness attributes are meeting experimental flavors, which then crosses with exotic launches, appealing to a wide array of consumers. These launches will set the tone for the future of the soft drinks market, as one that is highly innovative and prospering.
“Although only five ingredient developments have been highlighted, the future is expected to see a number of developments from flavors such as aloe and berry; we will also see more flavor combinations hit the shelves, combining non-fruit and herbal notes, with unique fruit bases.”
* GlobalData’s Annual Soft Market Analyser – Global
** GlobalData’s Q2-21 Consumer Survey Results – Global
Refresco, one of the world’s largest independent bottlers for retailers and A-brands in Europe and North America, today announces it has entered into an agreement to acquire HANSA-HEEMANN. This transaction is subject to regulatory approval.
HANSA-HEEMANN, headquartered in Rellingen, Germany, is a family-owned, independent beverage manufacturer with five production sites spread across Germany. Its operational excellence, industry expertise and integrated value chain enable HANSA-HEEMANN to offer customers best-in-class service. The vast majority of HANSA-HEEMANN’s volume (60 %) is in mineral water, with the remaining 40 % of its volume in carbonated soft drinks (CSD). HANSA-HEEMANN serves three different market segments: private label, own brands, and contract manufacturing for A-brands. HANSA-HEEMANN employs over 800 people with an annual revenue of approximately €300 million.
Strategic rationale
Today’s announcement is a continuation of Refresco’s successful buy-and-build strategy which is a key driver of the company’s ongoing growth and value creation. With this acquisition, Refresco further enhances its position in terms of product and brand portfolio, and geographical coverage.
Acquiring HANSA-HEEMANN will bring Refresco:
Diversification of its business with additional products and capabilities, while maintaining a well-balanced business mix and customer base
Strong brands such as Fūrst Bismarck, hella and St. Michaelis
Expansion of its offering in water and CSDs
Increased presence in Germany, now offering nationwide coverage to retail customers
Acceleration of its operational excellence through HANSA-HEEMANN’s know-how in the water category
A changing market
Water is the largest category within the non-alcoholic beverage market. The landscape is highly competitive and rapidly changing with many smaller local and regional players who maintain a strong foothold. Branded players with a wide range of water products are looking for opportunities to grow with retail discounters.
In addition, the focus on sustainability continues resulting in for example, increased demand for recycled PET and reduction in operational carbon footprint.
Within this highly competitive and changing market, the acquisition of HANSA-HEEMANN will enable Refresco to enhance its presence in Germany – not only broadening relationships with German retailers, but also improving transport efficiencies and reducing CO2 emissions. Furthermore, Refresco will be able to leverage its global scale to further drive change in improving the sustainable use of resources.
Paul Graham, GB Managing Director at Britvic, has been appointed as the new President of the British Soft Drinks Association (BSDA) trade body following election at its AGM.
Paul takes over from Nichols CEO Dr Marnie Millard OBE, who led a number of initiatives during her time as President, including the BSDA’s role as a founder-member of Circularity Scotland Ltd, a scheme administrator for Scotland’s deposit return scheme (DRS).
Paul joined Britvic in September 2012 having worked in a range of commercial roles across all trade channels for United Biscuits and Mars Confectionery. He was promoted to his current position in July 2013 and was appointed Vice President of the BSDA in 2020.
He said: “I am delighted to be elected as the new BSDA President. I aim to continue the outstanding work of Marnie and past presidents on making further significant progress on a wide range of soft drinks-related issues, not least helping our partners in the hospitality sector get back on their feet after an extremely challenging year.
“As a founder-member of Circularity Scotland, the BSDA continues to work closely with the Scottish Government to develop its DRS, which is currently due to be introduced in 2022, although we are eager to see the Scottish Government review this date to help ensure delivery of a well-designed DRS system in Scotland that works for consumers and businesses.”
William Watkins, Founder and Owner at Radnor Hills, has been elected to replace Paul as Vice President of the BSDA. William founded Radnor Hills in 1991 on his family farm based on the Welsh borders. The business now produces more than 350 million products per year.
The BSDA represents UK producers of soft drinks, including carbonated drinks, still and dilutable drinks, fruit juices and bottled waters. Membership includes the majority of Britain’s soft drinks manufacturers as well as franchisors, importers and suppliers to the UK soft drinks industry.
One of the fastest growing demands relates to better-for-you food and drink products with a natural and balanced level of sweetness. Symrise has done a deep dive into consumption behaviors and focused on revealing the diversity of sensorial preferences. It has conducted studies to guide the development of new taste solutions that meet the latest consumer taste preferences. The resulting solutions balance the taste of a reduced sugar level from cookies to cocktails while keeping a maximum level of indulgence in different ways, for different consumers.
Established and new labelling systems like the UK’s traffic light system or the Nutriscore are helping consumers to navigate their purchase. “The desire for a healthy weight and more natural sweetness in products has led to an increasing number of people looking for sugar-reduced products. These should taste good and, ideally, contain fewer calories,” says Dr. Dariah Lutsch, Sensory & Consumer Insights Research Manager of the Flavor Division at Symrise. “A purchase simulation shows that 75 percent of consumers would choose reduced-sugar versions within nearly all product categories”, adds Lutsch.
This refers to a study on sweet taste perception in Europe, Africa and the Middle East Symrise has recently carried out. It has found that multiple routes exist to reduce the sugar level while at the same time meeting taste preferences.
Route #1 – tastes as sweet as the full sugar version and 33 % of respondents prefer it.
Route #2 – tastes similar and less sweet and 20 percent of consumers prefer this route.
Route #3 – The third group of about 22 % behaves more adventurous. They are looking for a new unique flavor composition and accept a difference in taste compared to the full-sugar version.
Ideal sweetness for soft drinks
With a further study on the ‘Ideal Level of Sweetness’ in 2019 for Cola CSD (carbonated soft drinks) in Germany, Symrise wants to determine the optimal sweetness level with different sugar contents from 106 g/l to 75 g/l sugar. The study re-confirmed the findings and also revealed that consumers perceive a sample with 75 g/l as lacking in sweetness. Knowing that sugar reduction in beverages impacts the overall taste profile and sweet taste dynamics from mouthfeel, Symrise conducted a second study and tried to increase the consumer liking of sugar-reduced products by applying Symrise taste balancing solutions with Symlife®. The team succeeded in dramatically increasing the overall liking of sugar reduced cola versions 85g/l and 75g/l by adding the taste solution of Symrise.
Regardless, which route consumers prefer and which target consumer food manufacturers would like to reach, Symrise supports their customers in reducing calories in a range of beverage products – from ice tea to CSDs – and offers the final taste profile consumers love across all three scenarios.
Beverage Partners International (BPI) has the great pleasure of announcing that moving forward, it will offer a licensing and distribution opportunity for SUMOL+COMPAL, a world-leading market player in the fruit beverages category.
SUMOL+COMPAL is the largest juice producer in Portugal, with a global footprint in more than 68 countries around the world. The proud owner of a varied portfolio of 16 brands, the company’s offering is split across 6 different segments: juices and nectars, soft drinks, water, snacks, vegetables and alcoholic drinks.
Moshy Cohen, CEO, BPI, commented: “We are very proud to partner with S+C in their rapid international expansion. S+C is a company with unique know-how in the juice based beverage market, and excellent brands that can significantly improve the capabilities and competitive advantage of BPI’s bottlers across the world.”
Nadia Franco, S+C, Head of New Business, Int’l, added: “Sumol and Compal have great momentum in international markets. Both brands present superior products and unique positioning that perfectly fit the most important consumer trends.
“We are excited to join BPI and present licensing opportunities for it’s bottlers and distributors network across the world. We love our business, our brands and what we do. We want to keep doing better. We improve continuously and we think positively.”
Complementing a healthy lifestyle
SUMOL+COMPAL bases its ethos on inspiration it draws from fruits, vegetables and water, all indispensable natural sources of nutrition, hydration and pleasure. The global market for juice-based beverages, both fruit and vegetable-based, is projected to continue to grow thanks to innovation in the category alongside consumer demand for products that enable a healthy lifestyle.
The drive for Health and Wellness is providing huge opportunities for pioneering beverage industry players. Rising interest in non-alcoholic drinks options and beverages that complement a healthy lifestyle means that SUMOL+COMPAL offers a dynamic opportunity within the beverage category, targeting consumers with tasty, nutritious fruit and vegetable ingredients via established brands and exciting flavours.
Flagship brand COMPAL is the market leader in the Juice category in Portugal, with over 60 % market share in the country as well as a global presence, owing its loyal consumer following to its delicious and nutritional juices and nectars – picked at the perfect moment to ensure the final product is always rich in nutrients, and keeps the flavour and aroma of freshly-picked fruit.
SUMOL, meanwhile, is a slightly sparkling drink made with real fruit juice and pulp. With a wide and unique range of fruit flavours and a 62.4 % market share in Portugal, it is perfect for consumers looking for refreshment without compromising on their health and wellness lifestyle.
Meeting demand for healthy, low calorie beverages containing real fruit and vegetable ingredients, SUMOL+COMPAL’s natural products provide a unique offering that plays into its consumer for individualised products, with a unique range of fruit flavours available in its striking and iconic branded packaging.
‘No added sugar’ claims are growing in Europe, with the UK leading the charge as it has the highest proportion (15 %) of European food and drink launches carrying this claim in the past five years, followed by Germany (13 %) and France (10 %). In Poland, ‘no added sugar’ claims have doubled since 2016, reaching 9 % of food and drink launches in 2021.
According to Mintel’s latest consumer research, almost three out of five (59 %) French and German consumers are trying to limit their sugar intake, rising to 65 % of respondents in Poland and 67 % in Spain. However, over half of German (54 %) and (53 %) French* consumers simply prefer eating less indulgent products instead of consuming more ‘light/diet’ alternatives. This is especially true for carbonated soft drinks, with Polish (38 %)** and German (37 %)** consumers being the most likely to agree that ‘better-for-you’ carbonated soft drinks do not feel like a treat.
Neha Srivastava, Food and Drink Patent Analyst at Mintel, said:
“The pandemic has amplified the need for indulgence, influencing consumers’ choice of food and drink. At the same time, the pandemic has seen people place a higher priority on their health by, for example, reducing their sugar intake – but they don’t want to compromise on taste.
“Food and drink companies are starting to pay more attention to cutting sugar from their products. Based on the percentage of granted patents currently active in Europe, France and Germany are among the top five leading countries with the majority of patent grants related to sugar reduction, each accounting for 5 % of all global patent grants. Recent patent activity related to sugar reduction varies from improving the taste of sweeteners to innovating new techniques to reduce the production cost of rare sugars.”
Functional fibre and next-gen stevia could appeal as natural alternatives
Functional fibres in low/reduced sugar food and drink launches are on the rise, increasing globally from 11 % in 2015 to 19 % in 2020. Inulin is the most common functional fibre in low/reduced sugar products, with product launches containing inulin having tripled in the past five years, rising to 9 % in 2020 from 3 % in 2015.
With 63 %*** of Germans concerned about how sugar reduction in food and drink is achieved, combining fibres with sugar to reduce overall sugar content could be an option worth exploring as an alternative. This could also appeal to the 29 %**** of Brits that are interested in more fruit juices, juice drinks and smoothies with high fibre content.
Alternatively, stevia as a plant-based sweetener has the potential to appeal to European consumers as a sugar substitute. In fact, 63 %*** of Germans have no concerns about the amount of plant-based sweeteners (such as stevia) used in food and drink.
Neha Srivastava, Food and Drink Patent Analyst at Mintel, said:
“Consumers are aware of the importance of fibres in maintaining gut health. Brands can leverage this awareness by repositioning them as a multifunctional health ingredient that helps reduce sugar content in food and drink whilst improving gut health.
“Stevia continues to gain traction in food and drink launches because of its naturalness and zero calorific value, but its bitter and lingering aftertaste remains a significant barrier. Recent patent innovations to improve taste issues and physicochemical properties, like purity and solubility, to produce next-generation stevia may help overcome the challenge.
“Innovators are looking for alternative approaches, such as the use of sweet flavouring agents and aromas as a promising option to reduce sugar content in new food and drink products – especially in dairy desserts. This can be a promising option to reduce sugar content by providing sweet perception in brain cells.”
*987 internet users aged 16+ who try to eat/drink healthily, France; 1,955 internet users aged 16+ who try to eat/drink healthily, Germany; 997 internet users aged 16+ who try to eat/drink healthily, Spain; 988 internet users aged 16+ who try to eat/drink healthily, Poland; March 2021 **1,000 internet users aged 16+ in Poland and 2,000 internet users aged 16+ in Germany, December 2020 ***2,000 internet users aged 16+, Germany, June 2020 ****2,000 internet users aged 16+, UK, October 2020 *****1,000 internet users aged 16+, Italy and Spain, September 2020
Delivers double-digit net sales and earnings growth Raises full-year net sales guidance and reaffirms EPS guidance
Keurig Dr Pepper Inc. reported financial results for the first quarter ended March 31, 2021 and increased its outlook for 2021 net sales growth to 4 % to 6 %, from the Company’s prior net sales guidance of 3 % to 4 %. KDP also reaffirmed its guidance for full-year Adjusted diluted EPS growth of 13 % to 15 %.
Net sales in the first quarter of 2021 advanced approximately 11 % on both a GAAP and constant currency basis, with each of the Company’s business segments reporting strong growth. GAAP diluted earnings per share more than doubled to $ 0.23 and Adjusted1 diluted EPS grew to $ 0.33, a double-digit increase versus year-ago.
Commenting on the announcement, Chairman and CEO Bob Gamgort stated, “We delivered an exceptional first quarter, driving double-digit net sales and earnings growth, behind outstanding in-market execution. Looking forward, we see an improving, but volatile, macro environment marked by increasing consumer mobility and rising inflationary headwinds. We remain focused on delivering our business plan, with increased net sales growth expectations and growing confidence in achieving our Adjusted diluted EPS growth target of 13 % to 15 % for the year, and we plan to reinvest any earnings upside in the business to drive future growth.”
First Quarter Consolidated Results
Net sales for the first quarter of 2021 increased 11.1 % to $ 2.90 billion, compared to $ 2.61 billion in the year-ago period, driven by strong growth in each business segment, particularly Coffee Systems. On a constant currency basis, net sales advanced 10.8 %, reflecting higher volume/mix of 10.3 % and favourable net price realization of 0.5 %.
KDP in-market performance in the quarter remained strong, with retail dollar consumption2 advancing 9.4 % across the Company’s cold beverage retail base, with particular strength in CSDs3, premium unflavoured water, teas, juice drinks, apple juice, vegetable juice, mixers, and coconut water. This performance reflected the strength of Dr Pepper, Canada Dry, A&W, 7UP, and Sunkist CSDs, CORE hydration, Snapple teas and fruit drinks, Clamato vegetable juice, Motts apple juice, and Vita Coco. On a two-year stacked basis, consumption of KDP’s cold beverage portfolio increased 17 %. …
1Employee compensation expense and employee protection costs are both included as the COVID-19 items affecting comparability in the reconciliation of our Adjusted Non-GAAP financial measures. 2In 2021, reflected pay for temporary employees, including the associated taxes, as well as incremental benefits provided to frontline workers such as extended sick leave, in order to maintain essential operations during the COVID-19 pandemic. In 2020, primarily reflected temporary incremental frontline incentive pay and benefits, as well as pay for temporary employees, including the associated taxes. Impacts both cost of sales and SG&A expenses. 3Included costs associated with personal protective equipment, temperature scans, cleaning and other sanitisation services. Impacts both cost of sales and SG&A expenses.
Reaching 14.6 % reduction of added sugars in soft drinks between 2015-2019
Europe’s soft drinks industry has reduced added sugars in its drinks across Europe by an average of 14.6 % between 2015 and 2019.[1]
UNESDA Soft Drinks Europe, representing soft drinks producers across the EU, is committed to creating healthier and more sustainable food environments. It is determined to support consumers in managing their intake of added sugars from soft drinks by ensuring that the healthier choice becomes the easy choice. The industry responded to the European Commission’s call for a 10 % reduction in added sugars by 2020 and recent research, by independent analysts GlobalData, confirms that it has met, and surpassed, the target ahead of time.
“This reduction is proof that the soft drinks industry’s voluntary efforts to reduce sugar across the EU are delivering tangible results,” said UNESDA president and president Western Europe at The Coca-Cola Company, Tim Brett. It demonstrates our sector’s accelerated action in response to changing consumer preferences and the expectations of public health stakeholders.”
The 14.6 % reduction in added sugars has been achieved through a comprehensive range of actions including changing recipes to reduce sugars while maintaining a taste with which consumers are happy; innovating to develop new products with different sweetness levels; increasing availability of small packs to support portion control and moderation; and nudging people toward more no- and low-sugar/calorie options through marketing investments. This latest sugar reduction comes on top of previous achievements and means that Europe’s soft drinks industry has now reduced added sugars by an average of 26 % since 2000.
UNESDA is a founding member of the EU Platform for Action on Diet, Physical Activity and Health and has undertaken a series of voluntary commitments over the past 15 years to help address unhealthy diets as a risk factor for non-communicable diseases. These have been complemented by numerous national pledges to support EU member states in their action plans to create healthier food environments. These pledges are the result of stakeholder engagement at a national level and set targets based on local baselines and expectations. They reflect the conclusions of the 2016 Dutch EU Presidency which highlighted that sugar reduction is a gradual process and needs to take account of different dietary habits and preferences across the EU.
“Our sector’s progress in reducing sugar and calorie reduction has been enabled by the openness of stakeholders to engage through the EU Platform,” concluded Tim Brett. “We believe that the EU Code of Conduct for responsible business and marketing practices announced in the EU Farm to Fork strategy offers an opportunity to continue this dialogue with all actors, including Member States. As an industry we are committed to maintaining our efforts through a range of voluntary actions to ensure that the healthier choice becomes the easy choice.”
The path towards sugar reduction through reformulation comes with multiple challenges from a technological and consumer acceptance perspective and these become greater the more the reductions continue.
While the soft drinks sector has reduced the average sugar content in its products, and the WHO’s research[2] shows that frequency of consumption among school-aged children has declined across all age groups over the past 16 years, recent data shows that rates of overweight and obesity have not reduced. This demonstrates the complexity of the issue and the need for a holistic approach with all food and drink sectors committing to actions that support healthier food environments.
In addition to ongoing sugar and calorie reduction, Europe’s soft drinks sector has also made far-reaching commitments to behave responsibly in the marketplace including no advertising to children under 12; no sales of any soft drinks in EU primary schools and only no- and low- calorie drinks offered for sale in EU secondary schools.
About UNESDA Established in 1958 UNESDA Soft Drinks Europe is a Brussels-based association representing the European soft drinks industry. Its membership includes both companies and national associations from across Europe producing drinks including still drinks, squashes, carbonates, powders, iced teas, iced coffees, syrups, energy drinks and sports drinks. It is signatory to the EU Transparency Register (No: 25498952296-56).
Juice has been acknowledged as a rapidly declining soft drinks category, with volumes weakening by 3 % in 2019, compared to the same period in 2018, according to leading data and analytics company GlobalData’s UK Quarterly Beverage Forecast in Q4 2019.
Holly Inglis, Beverages Analyst at GlobalData, comments: “Although the juice category is free from the sugar tax levy in the UK, consumption has still seen a downward turn in recent years, with consumers opting for other soft drinks categories such as iced/ready-to-drink (RTD) teas and enhanced waters, although none of these promote lean tags.
Another finding from GlobalData’s surveys include that a total *43 % of UK consumers claim they pay a high to very high amount of attention to the ingredients used in the food and drinks they consume.
An attempted turnaround in 2020 is Tropicana Lean – a new juice variant that indicates a movement towards better-for-you beverages in line with current consumer beverage trends.This poses the question whether Tropicana is taking a leap of faith with promoting a lean juice, or in fact we will welcome a new entry into the soft drinks market that combines hydration with health.
Inglis noted: “Tropicana’s innovation comes soon after the brand’s release of Tropicana Whole Fruit in May 2019, which attempted to impact the market with its high-fibre claims.”
*GlobalData’s Q3 2019 Consumer Survey
The UK non-alcoholic spirits category has grown to be worth £37m in 2019, up 506 % versus 2014, and is forecast to more than double in size again over the next five years, according to GlobalData, a leading data and analytics company.
David Harris, Consumer Analyst at GlobalData, says: “Younger generations are drinking less, with Gen-Z only strengthening this trend as they reach legal drinking age. This is hardly ground-breaking news. Adult soft drinks, premium juices and a growing range of high-quality non-alcoholic beers are all targeted at this demographic, in addition to older consumers who simply want to moderate their alcohol consumption.”
So what about consumers who don’t want a non-alcoholic beer, but still want an ‘alcohol-alike’ beverage? This may be at a party, on a night out, or at home when everyone else is enjoying their gin and tonics. This is the specific opportunity non-alcoholic spirits are targeting. Where craft beers targeted consumers turned off by mainstream German and US lager brands, non-alcoholic spirits aim to engage consumers who want to feel part of the party, but who don’t want a sore head in the morning.
Harris adds: “Talking of craft beer, what is notable is how the rise of non-alcoholic spirits mirrors the rise of craft beer, arguably the beverage trend of the last decade. With laser targeting of a specific need, from a specific demographic, there are clear similarities between non-alcoholic spirits and craft beer.
“Both target younger legal age consumers. Both target consumers who are either tired of, or have no interest in, the mainstream variant of the offering, and both use flashy, stylized and no-nonsense packaging to engage with their audience.”
Excited with the prospect, major players in spirits are increasingly looking to get involved, with William Grant and Sons launching their Atopia range, Pernod-Ricard launching Celtic Soul, as well as the Diageo-funded Seedlip, which has now expanded out of the UK and into overseas markets.
Retailers also seem to agree that this is a category to watch too, with Tesco, Lidl, Asda, and more major UK retailers all stocking at least one non-alcoholic spirit.
Harris concludes: “While this may not be the next craft beer, the opportunity is certainly there, and both brands and retailers agree that this in an opportunity which is too big to miss.
Over the past 10 to 20 years, the ripples of change in the global soft drinks market have threatened to become tidal waves, with new categories emerging constantly and genuine novelty flooding the shelves.
According to a new report from Innova Market Insights, which highlights that in the global shift in soft drinks, juices and carbonates may still be the two most active sub-categories worldwide but growth is clearly much faster in alternative areas. For example, Ready-to-drink (RTD) sports drinks saw launch numbers increase at a CAGR of 26 % over 2014-2018, compared with 12 % CAGR for iced tea and coffee and 10 % CAGR for ‘other’ soft drinks, including novelties such as herbal drinks, jelly drinks and vinegar drinks.
Flavor trends also demonstrate the changing face of the market. The fastest growing flavors in recent years include matcha tea (+49 % CAGR 2013-2018), apple cider vinegar (+21 % CAGR) and kombucha (+21 % CAGR), all of which are thriving concepts from Asia that are now distinguishing themselves on a global platform.
As well as the emergence of new categories, overlap between existing varieties is continuing. ‘Hello Hybrids’, one of Innova’s Top 10 Trends for 2020, is perhaps nowhere as important as in the soft drinks arena. ‘Category definitions are blurring all the time,’ says Lu Ann Williams, Director of Innovation at Innova Market Insights. “For example, in the US, Odwalla has recently developed the Smoobucha, which is a blend of fruit smoothie with fermented kombucha.”
At the same time, as suppliers seek new platforms for success, segmentation is also changing the face of the soft drinks shelves. For example, Water+ is an established concept but is continuing to evolve beyond vitaminization and added energy, with fiber, probiotics, collagen and mood ingredients all finding their way into modern waters.
2019 broke records again for the number of food and drink transactions around the world, with 789 registered on the Zenith Global mergers and acquisitions database, an average of 15 each week.
The total is 12 more than in 2018 and 41 % higher than 5 years ago. The number has increased every year since a dip in 2013.
The most active sectors were ingredients on 65, dairy on 63, soft drinks on 57 and packaging on 49. Beer on 38 was ahead of spirits on 35 and wine on 28.
Global food and drink acquisitions by sector 2018-2019 (Photo: Zenith Global)
The top 15 sectors were the same as 2018, with the exception of CBD replacing confectionery. The combination of plant-based (15) with dairy-free (14) and meat-free (11) totalled 40. Bottled water and water coolers added up to 23. Vertical farming was a newcomer with 8.
The biggest increases were for CBD (+19) and beer (+15). Many of the main categories saw declines, led by services (-19), confectionery (-18) and wine (-9).
In line with the company motto “Turning the best out of nature into Multi-Sensory & Nutritional Excellence”, Doehler will present pioneering ingredients, ingredient systems and integrated solutions for the beverage industry to visitors at BrauBeviale, which will take place in Nuremberg from 12 to 14 November 2019.
From reduced-sugar adult soft drinks in innovative flavours, to fruity and fresh NFC juices, to refreshing fruit-infused water and full-bodied, alcohol-free beers, visitors to the Doehler stand can discover inspirational ideas for their next successful product. All innovation concepts are based on a comprehensive portfolio of natural ingredients ranging from natural flavours, natural colours, health ingredients, pulses & cereal ingredients, dairy & plant-based ingredients, fermented ingredients, fruit & vegetable ingredients to ingredient systems, as well as a diverse range of certified organic ingredients.
The next generation of beer-mix drinks
Beer remains one of the world’s most popular alcoholic beverages. Primarily young consumers are looking for diverse product concepts in innovative flavours, a fact that offers tremendous market potential for beer-mixes. Doehler will present exciting beer-mix concepts at BrauBeviale 2019 which producers can use to shake up the beer market. Alongside classic beer-mixes with lemon or grapefruit flavours, reduced-sugar beer-mix variants are currently in high demand. The sugar-reduced beer-mix lemon product impresses with its authentic taste and full-bodied mouthfeel, while using 30% less sugar compared to other common beer-mix beverages. Doehler’s MultiSense® Flavours enable the sugar content in alcoholic and non-alcoholic beverages to be reduced significantly, while simultaneously retaining the full taste.
“Double brew beer-mixes” are also winning over consumers with their authentic taste profiles. Perfectly balanced and refreshing beer-mixes combine two brewed components: beer and brewed lemonade. A fruit content of up to 6 % derived from fermented juices and various botanical extracts ensures that the beer-mixes are less sweet and have a particularly refreshing taste. Visitors to the Doehler stand will have the opportunity to try the double brew beer-mix with a hint of lime.
Reduced-sugar and refreshing – soft drinks for every taste
At BrauBeviale, Doehler will also present its extensive portfolio of adult soft drinks which are specifically tailored to the consumer requirements of adults. Using high-quality ingredients from Doehler such as innovative botanical extracts and distillates, brewed and fermented ingredients or high-quality NFC juices, the adult soft drinks impress with their tart, less-sweet taste profiles.
Doehler also has different solutions to reduce the sugar content in soft drinks. By using MultiSense® Sweet Aroma, the refreshingly light soda tastes fruitier and less sweet while having a sugar content of less than 5 g per 100 ml. The lemonade combines the sour and fresh taste of lemon with a hint of peach and is presented in the trend colour of coral. Consumers looking for another lemonade with a less sweet, more “grown-up” taste profile should try Doehler`s brewed soda with its special flavours of brewed ginger and brewed lime. Thanks to a natural sweetening solution using a stevia tea brew, the drink has a sugar content of just 4.1 g per 100 ml.
Innovative juice drinks – natural, reduced-sugar and delicious
Reducing the sugar and calorie content in alcoholic and non-alcoholic beverages is currently in the spotlight. The demand for reduced-sugar beverages is continuously growing, particularly when it comes to juice and juice drinks: every third juice on the market is now an NFC juice. These juices are derived from natural sources and have authentic “home-made” tastes. Reducing sugar content is one of the biggest challenges facing manufacturers. “NFC Naturally Light” are innovative product concepts from Doehler which can solve this problem. The “light” juices from Doehler – such as the “next-generation apple juice” which is made from apple juice and coconut water – not only consist entirely of NFC juices, but also contain less sugar and fewer calories than conventional juices and impress consumers with their refreshing and fruity tastes. Thanks to our wide range of high-quality fruit and vegetable ingredients, we can present product concepts to trade fair visitors which satisfy every taste.
Natural ingredients for a healthy lifestyle
Many consumers consider the nutritional properties of the products they purchase. This is resulting in growing worldwide demand for beverages containing natural ingredients and which have a positive effect on health. No other beverage better combines the trends of naturalness and health than fruit-infused waters. At BrauBeviale, Doehler will present innovative concepts such as fruit-infused water in apple lemon or raspberry mint variants. Water with different flavours is enjoying ever greater popularity: enriched with natural fruit infusions and agave, these trend drinks are impressing consumers around the world with their taste – while containing less sugar or sweeteners and fewer calories.
Hall 1, Stand 303
A new study suggests higher consumption of sugary beverages, including fruit juice, is associated with increased mortality.
Gavin Partington, director-general of the British Soft Drinks Association, said: “This study is inconclusive, and the way its findings are presented is misleading. All age groups in the UK are falling short on their 5 A Day consumption of fruit and vegetables. Therefore, warning against consuming a small 150 ml portion of pure fruit juice – which counts as one of your 5 A Day – risks people foregoing the vitamin and phytonutrient benefits of fruit juice that this study acknowledges.
“Our research shows adults and teenagers who drink fruit juice are about twice as likely to reach their recommended minimum of 5 A Day, than non-drinkers.”
You can read the highly controversial study “Association of Sugary Beverage Consumption With Mortality Risk in US Adults” under: www.jamanetwork.com
SIG partnership showcases recycling in action at Mexico fun park
SIG has teamed up with soft drink producer Sociedad Cooperativa Trabajadores de Pascual (SCTP) and fun park operator Ventura Entertainment to raise awareness of the importance of recycling through special collection bins made from recycled carton packs at La Feria de Chapultepec amusement park in Mexico.
Brand power to raise awareness
SIG’s aseptic beverage cartons are 100 % recyclable, but the rate of packs recycled remains low in Mexico due to low awareness of the value of recycling and a lack of suitable waste collection systems.
The new Coopera Recycling Campaign from SIG, SCTP and Ventura Entertainment aims to use the power of popular brands to raise awareness of the value of recycling among consumers of all ages. SCTP is one of Mexico’s largest soft drinks producers and the name behind Boing!® fruit drinks. Ventura Entertainment is one of the country’s biggest attractions operators and its La Feria de Chapultepec fun park attracts over 1.5 million visitors a year.
In the first phase of the campaign, SIG will provide 15 recycling containers to be placed around the park. Each is made out of a mix of polymer and aluminium that comes from around 7,000 recycled carton packs, providing a tangible example of recycling in action. Accompanying signs promote recycling and Ventura Entertainment will offer discounts on ticket prices for amusement activities for visitors who use the recycling bins. The empty cartons will be recycled by specialist company Alcamare.
Keeping high-quality materials in use
Encouraging consumers to recycle beverage cartons supports the circular economy by returning more materials into the value chain to produce new products. SIG’s cartons are made from mainly renewable materials in the first place so recycling them keeps high-quality renewable materials in circulation.
Contributing to the circular economy by using renewable content, optimising use of materials and promoting recycling after use is part of the company’s commitment to go Way Beyond Good by putting more into society and the environment than it takes out.
Cott Corporation announced the sale of its soft drink concentrate production business and its RCI International division (“Cott Beverages LLC”) to Refresco for USD 50 million, who in turn sold the RCI worldwide branded activities to RC Global Beverages Inc.
“This transaction is the final step in the transformation of our business where selling the remaining business unit of the traditional carbonated soft drinks business is consistent with our strategy of accelerating the growth across our platform in water, coffee, tea, extracts and filtration solutions,” commented Tom Harrington, Cott’s Chief Executive Officer. “We want to thank all the associates of Cott Beverages LLC for their contributions and wish them well as they rejoin their former traditional bottling business colleagues and become a part of Refresco,” continued Mr. Harrington.
Hans Roelofs, CEO Refresco: “We are pleased to add Cott’s Columbus concentrate manufacturing facility to Refresco North America. It adds extensive innovation capabilities and skills and creates a global center of excellence for beverage concentrate manufacturing. It is a perfect fit with our business. We have decided to divest the RCI International branded activities and find an owner who can bring similar focus and continuity to this iconic brand. With RC Global Beverages Inc., we believe we have found an excellent match. The sale of Columbus from Cott to Refresco and the sale of the RCI International activities from Refresco to RC Global Beverages Inc. took place simultaneously.”
Mental health is a pressing concern around the world with many consumers turning to health enhancing ingredients to help relieve a range of conditions including stress, anxiety and insomnia.
Whilst the food and beverages industry is awash with products that deliver on health, wellbeing and energy, mental health related new product development (NPD) has lagged behind with demand for these types of products varying amongst regions, says GlobalData, a leading data and analytics company.
Consumer research from GlobalData’s latest report, ‘Top Trends in Healthcare and OTC Products 2018 – The latest trends in: OTC medication; vitamins, minerals, and supplements; functional food and drink; and sports nutrition’, reveals that 66 % of European consumers say that stress is a pressing mental health concern followed closely by overwork (56 %) and insomnia (55 %).
William Grimwade, Consumer Analyst at GlobalData comments, “There is clearly an opportunity for beverage manufacturers in Europe to develop products with mental health enhancing functionality.
“A high percentage of beverages in the region contain fortified and nutraceutical ingredients and 61 % of consumers say that soft drinks are their preferred method of consuming health enhancing ingredients.”
Health drinks have often been characterised as simply low sugar or energy boosters fortified with caffeine, vitamins or minerals. Mental health is a growing concern, but fortified drinks rarely address this need.
However, ingredients such as Gingko Biloba, Turmeric and Lecithin are increasingly being used in this field with companies like Coca-Cola investing in new emerging ingredients like Cannabidiol or CBD oil.
Grimwade adds, “With stress and overwork being the top mental health concerns in Europe driven by long working hours and the political and economic turmoil in the region creating so much uncertainty, demand for drinks fortified with stress and anxiety relieving ingredients will only increase.”
Together with its affiliate Stern Ingredients México, the Stern-Wywiol Gruppe based in Hamburg celebrated the enlargement of its production plant in Mexico City and is intensifying product development at the adjoining Technology Centre. The research facility will in future focus on dairy products, beverages and deli foods, too. The plant has two new production lines for food ingredients, and with 4,000 tonnes additional production capacity it will contribute to the group’s success in Latin America. After the facility in Malaysia, this is the second plant to be opened by the Stern-Wywiol Gruppe this year.
By placing greater emphasis on the development of applications in the field of dairy products, deli foods and soft drinks such as juices, nectars and concentrates, Stern Ingredients México, an affiliate of the Stern-Wywiol Gruppe, is now consolidating its position as an ingredients expert for the food industries of the Americas. The new focus of the long-established facility in Mexico will complement the already successful development of enzyme systems under the trade name SternEnzym, stabilizing systems (Hydrosol), vitamin and mineral complexes (SternVitamin) and flour and bakery applications under the brands Mühlenchemie and DeutscheBack – the latter specializing in typical regional products based on maize and wheat. Following the “custom fit” approach of the Stern-Wywiol Gruppe, leading food technologists develop the above functional systems for dairy products and beverages at this state-of-the-art applications laboratory. Furthermore, the owner-managed family business from Hamburg regards the generation of new information on applications at the research centre in Mexico as an opportunity to extend its technical services to North, Central and South America. It has also invested in the plant’s QM laboratory in order to conduct microbiological analyses, heavy-metal detection and a wide range of trial applications according to the latest scientific standards.
With around 100 employees and a total annual production capacity of 10,000 tonnes of food ingredients, Stern Ingredients México is the Stern-Wywiol Gruppe’s biggest plant outside Germany. On the one hand, the additional production capacity of 4,000 tonnes will help to meet Mexico’s increasing home demand, and on the other it will open up new export markets.
The Coca-Cola Company reported continued momentum in its business for 2018, with strong financial results for the third quarter. While reported net revenues for the quarter declined due to refranchising, the company delivered broad-based organic revenue (non-GAAP) and volume growth across all operating groups, while gaining value share globally.
Strong organic revenue (non-GAAP) growth in the quarter was driven by continued innovation and revenue growth management initiatives within sparkling soft drinks, as evidenced by double-digit volume growth of Coca-Cola Zero Sugar across all groups. In addition to sparkling soft drinks, the company saw strong performance for brands like Fuze Tea and smartwater. Coca-Cola also announced several strategic actions, including a number of acquisitions and investments, and continued to lift, shift and scale brands around the world. The company’s disciplined growth strategies and an ongoing focus on productivity led to double-digit profit growth for the quarter.
“We continue to be encouraged by our performance year-to-date as we accelerate our evolution as an even more consumer-centric, total beverage company,” said James Quincey, President and CEO of The Coca-Cola Company. “The recent leadership appointments are intended to help accelerate the transformation of our company.”
Highlights
Quarterly Performance
Revenues: Net revenues declined 9 % to $8.2 billion, impacted by a 13-point headwind from the refranchising of company-owned bottling operations. Organic revenues (non-GAAP) grew 6 %, driven by concentrate sales growth of 4 %, which benefited from the timing of shipments, and price/mix growth of 2 %.
Volume: Unit case volume grew 2 %, led by Trademark Coca-Cola.
Margin: Operating margin, which included items impacting comparability, expanded approximately 600 basis points. Comparable operating margin (non-GAAP) improved 575 basis points, driven by divestitures of lower-margin bottling operations and the company’s ongoing productivity efforts. These drivers were partially offset by an approximate 130 basis point headwind from the adoption of the new revenue recognition accounting standard and the impact of currency.
Market share: The company continued to gain value share in total nonalcoholic ready-to-drink (NARTD) beverages.
Cash flow: Year-to-date cash from operations was $5.5 billion, down 7 %. The decline was largely due to the impact of refranchising North American bottling territories and increased tax payments, partially offset by solid cash generation in the underlying business. Year-to-date free cash flow (non-GAAP) was $4.6 billion, down 2 %.
Share repurchases: Year-to-date purchases of stock for treasury were $1.6 billion. Year-to-date net share repurchases (non-GAAP) totaled $707 million.
The University of Cambridge Institute for Sustainability Leadership (CISL) and a group of leading bottled water and soft drink manufacturers have launched a report at the House of Commons, which sets out an ambitious roadmap to eliminate plastic packaging waste from the bottled water and soft drinks value chain by 2030.
The report, the first of its kind, is set out to enable and encourage other industries and countries to create their own systemic roadmaps and visions to eliminate plastic packaging waste.
The report, developed collaboratively by the industry and its stakeholders, sets out key actions and aspirations to make eliminating plastic packaging waste a strategic priority. These include:
Producers to commit to all bottled water and soft drinks packaging to be made from 100 per cent recyclable or reusable material and aim for at least 70 per cent recycled material by 2025.
Producers and Government to investigate the optimal material of the future for bottled water and soft drinks that eliminates plastic waste while ensuring the lowest overall environmental impact.
Producers and Government to undertake research into consumer behaviour to support recycling ambitions towards achieving a ‘circular economy’ for bottled water and soft drinks packaging.
Government to create a consistent nationwide recycling system, and reinvest revenue from new policies into UK recycling, sorting and reprocessing capacity.
The roadmap provides a clear timeline for working towards the ultimate goal of transitioning to a more circular economy for plastic soft drinks packaging, where plastic packaging use is reduced wherever possible and otherwise is reusable or recovered and recycled.
The report was developed with input from the Future of Plastic Packaging Working Group: Lucozade Ribena Suntory and members of the Natural Hydration Council: Brecon Mineral Waters, Danone Waters (UK and Ireland), Harrogate Water Brands, Highland Spring Group, Montgomery Waters, Nestlé Waters UK, Shepley Spring and Wenlock Spring.
The American Beverage Association (ABA) announced that Katherine Lugar, president and chief executive officer (CEO) of the American Hotel & Lodging Association (AHLA), will join ABA as its new president and CEO later this year. Lugar will succeed Susan K. Neely, who successfully led ABA for 13 years. Neely was named president and CEO of the American Council of Life Insurers (ACLI) in May 2018.
Lugar will leverage deep public policy and advocacy experience on behalf of ABA and its member companies, which make and sell some of the world’s most popular and innovative non-alcoholic beverages. As president and CEO of AHLA, Lugar transformed the lodging industry’s largest association in her five-year tenure, tripling revenue and membership, strengthening the association’s core mission on advocacy, championing the industry’s voice with policymakers and achieving historic highs for the industry political action committee (PAC) placing it in the top two percent of all association PACs.
Lugar previously served as the Retail Industry Leaders Association’s (RILA) executive vice president of public affairs, where she ran a number of successful, high-profile issue campaigns. Prior to RILA, Lugar led government relations for Travelers Insurance, served as vice president of legislative and political affairs at the National Retail Federation (NRF) and worked on Capitol Hill. She currently is chair-elect of the board of the St. Baldrick’s Foundation for pediatric cancer, a member of the executive committee of the Bryce Harlow Foundation and a member of the U.S. Chamber of Commerce’s Committee of 100.
The non-alcoholic beverage industry employs more than 250,000 people with a direct economic impact of more than $182.6 billion. The industry manufactures a variety of beverage choices in a wide range of calories and package sizes, including bottled water, 100 percent juice, juice drinks, sports drinks, soft drinks, ready-to-drink teas and energy drinks.
A study released this week illustrates how the European soft drinks industry is rooted in the European economy and boosts progress throughout its value chain. The sector generates € 185 billion revenue – equivalent to 1.24 % of EU GDP, indirectly supports 1.7 million jobs and delivers almost € 30 billion in tax contributions to EU member states.
The industry supports a local value-chain of suppliers, distributors and retailers with a revenue that is 2.5 times greater than that which it receives itself. It contributes revenue, jobs and investment from the agricultural sector where it sources ingredients including fruit, berries and sugar beet; to the packaging and raw materials industries; through to the transport and distribution sectors and finally to the supermarkets, shops, bars and restaurants across the continent where its products are sold.
The study was undertaken by leading drinks industry analysts Global Data to mark UNESDA’s 60th anniversary and is based on 2016 data.
The craft beer boom, which is primarily driven by younger consumers, is having spill-over effects on other industries, including the coffee sector. Within the sector, cold-brew coffee is gaining popularity. However, given its unique taste profile and perceived health benefits, opportunities exist for cold-brew producers to appeal to young as well as older age group consumers, finds leading data and analytics company GlobalData.
Since the brewing process does not require heat, the resulting cold-brew coffee drink has a smoother taste which often reduces the need for creamers, sugar or sweeteners. As a result, several consumers perceive cold-brew coffee to be a healthier alternative to traditional coffee.
GlobalData found that health and fitness is a high priority for younger consumers, hence the potential health benefits of cold-brew coffee are likely to be a key motivator for purchase among this cohort. This reflects in its 2017 Q4 global consumer survey, which shows that 21 % of consumers are interested and already purchasing beverages with cold-brew claims, while a further 27 % are interested but not yet actively buying such products.
Matthew Perry, Consumer Analyst at GlobalData, explains: “A number of consumers are now looking for more premium and indulgent soft drinks which demonstrate quality, authenticity and artisanal production methods. The fact that cold-brew coffee has been around for hundreds of years may heighten the appeal of the beverage among younger consumers driving the craft movement.”
In particular, younger consumers aged between 18 and 34 are more interested in cold-brew, with 28 % globally interested and actively buying such beverages, reveals the survey. This is 11 percentage points higher than those aged 35 and over.
Perry concludes: “Given the popularity of cold-brew among younger age groups, producers may wish to target these consumers with their offerings. However, it is important to understand that while the unique processing methods and sensory aspect of cold-brew may encourage younger consumers to experiment with the beverage, cold-brew coffee’s smoother, less acidic taste may resonate with older consumers who may prefer milder flavors and products which require less sugar.”
Following the closing of the public offer on Refresco Group N.V. (“Refresco”) by Sunshine Investments B.V., the consortium of PAI Partners SAS (“PAI”) and British Columbia Investment Management Corporation (“BCI”), Refresco announced that Sunshine Mid B.V., the entity owning Sunshine Investments B.V. (the “Issuer” and together with its subsidiaries, “we” or the “Group”) has launched an offering of €445,000,000 aggregate principal amount of senior notes due 2026 (the “Notes”).
The net proceeds from the offering, if completed, are expected to be used by the Issuer to repay the bridge facility borrowed in connection with Issuer’s acquisition, through its direct subsidiary, Sunshine Investments B.V., of 99.4 % of the issued and outstanding shares of Refresco and to pay expenses related to the offering of Notes.
The Group, together with its committed sponsors, PAI and BCI, plan to continue to capture organic growth in both the retailer brands and contract manufacturing business, executing the Group’s “buy-and-build” strategy and striving for continuous operational excellence.
An important step in the buy-and-build strategy was taken with the acquisition of the Cott Traditional Beverage business in January 2018. This acquisition has created the world’s largest independent bottler of retailer brands soft drinks by volume and a leading contract manufacturer of soft drinks by volume for A-brands with leadership positions across Europe and North America, providing meaningful diversification to Refresco’s customer base. In 2017, on a standalone basis, Refresco’s top 10 customers accounted for 58 % of its volumes and the Cott Traditional Business’s top 10 customers accounted for 66 % of its volumes. Together, the company’s top 10 customers accounted for 49 % of its pro forma volumes in 2017. Refresco is now circa 4.1 times larger than its next largest competitor (excluding pure-play water players) in the markets in which the company operates.
Integration of the activities in all countries has started, following receipt of CMA approval in the UK last month. Refresco now anticipates total run-rate synergies of €63 million in the first three years following the consolidation. The Group’s Pro Forma Synergies Adjusted EBITDA for the year ended December 31, 2017 was €392.1 million and the Group’s forma net indebtedness as of December 31, 2017 was €2,330.9 million.
The Notes have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any other jurisdiction. The offering of the Notes will be made only in the United States to qualified institutional buyers in reliance on Rule 144A under the Securities Act and outside the United States in offshore transactions in reliance on Regulation S under the Securities Act to persons other than retail investors in the European Economic Area, whereby a retail investor is defined as a person who is one (or more) of: (i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU, as amended; or (ii) a customer within the meaning of Directive 2002/92/EC, as amended, where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II; or (iii) not a qualified investor as defined in Directive 2003/71/EC, as amended. No approved prospectus within the meaning of the Prospectus Directive is required is connection with the offering of the Notes.
Regulatory Notice This announcement may contain inside information of Refresco Group N.V. under Regulation (EU) 596/2014 (16 April 2014).
MiFID II professionals/ECPs-only / No PRIIPs KID – Manufacturer target market (MIFID II product governance) is eligible counterparties and professional clients only (all distribution channels). No PRIIPs key information document (KID) has been prepared as not available to retail in EEA.
In the United Kingdom, this communication is directed only at (i) persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (ii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2) of the Order or (iv) persons to whom an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Services and Markets Act 2000 (the “FSMA”)) in connection with the issue or sale of any notes may otherwise be lawfully communicated or caused to be communicated (all such persons together being referred to as “relevant persons”). In the United Kingdom, any investment activity to which this communication relates will only be available to, and will only be engaged with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.
2017 was another record year for food and drink industry transactions, with 727 registered in the bevblog.net mergers and acquisitions database, an average of almost 14 each week.
The total is 103 more than in 2016 and 40 % higher than five years ago. The number has increased each year apart from a dip in 2013.
The most active sectors were dairy on 72, ingredients and soft drinks on 68, then packaging on 54. Beer on 40 was ahead of spirits on 37 and wine on 30.
The top 15 sectors were the same as 2016, with the exception of plant-based replacing bottled water.
Plant-based deals quadrupled (+13), with nutrition up 121 % (+17), meat up 67 % (+16), snacks up 52 % (+11), ingredients up 36 % (+18) and dairy up 24 % (+14). Wine activity dropped by 36 % (-17) and packaging by 16 % (-10).
This morning the Prime Minister Theresa May launched the Government’s 25 Year Environment Plan for England.
Under the Government’s plan, there will be an extension of the 5p charge for plastic carrier bags to all retailers in England, supermarkets will be encouraged to introduce “plastic-free” aisles and taxes and charges on single-use plastic items will be considered as part of planned Government consultations.
Gavin Partington, Director General at the British Soft Drinks Association, responded to the plan:
“BSDA and its members welcome the launch of government’s 25 Year Environment Plan and its commitment to an evidence-based approach to establishing the best way to deal with plastic waste.
“The ambition is for all our packaging in the UK to be 100 % recyclable, that consumers recycle and that drinks containers do not end up as litter in our towns, countryside, rivers and oceans.
“China’s decision to ban plastic waste imports has further exposed the gaps in the UK’s recycling infrastructure and emphasised the need for a reform of the current compliance system.
“We believe that by working together with governments, NGO’s and other stakeholders real progress can be achieved to make the UK the world leader in creating a truly circular economy.”
BOTANICS, a new range of premium organic cold-pressed soft drinks is being launched this month in Bar brand All Bar One across the UK. Created by pioneering drinks creators Botanic Lab, the BOTANICS line has been designed specifically with social drinking in mind. The range is made up of three botanically enhanced, cold-pressed adult drinks that shake up common perceptions of ‘healthy drinks` and bring sophistication, complexity and exceptional flavours to the on-trade.
VITALISE – Sencha green tea sourced direct from Kyoto combines with a powerful berry trio of schisandra, goji and strawberry. Peppery sechuan aromas bring together this complex combination of fruity, savoury, sweet and tart.
FORTIFY – A complex and spicy elixir combining the cold pressed juice of raw turmeric and ginger, accented by the warmth of fresh chilli. Cool spearmint and vanilla notes complete the flavour.
INVIGORATE – The inky hue of activate charcoal is juxtaposed with cold pressed cane grass and raw yuzu. A sweet exotic flavour with an intense citrus tang enhanced with Siberian ginseng.
Botanic Lab CEO and co-Founder Rebekah Hall says, “The new BOTANICS line brings sensuality and functionality along with the inimitable Botanic Lab innovation that is so valued by our customers, to a brand new audience at All Bar One. Our drinks offer boldly sophisticated choices for anyone seeking a clean uplifting kick in a social environment.” Rebekah continues, “The impending sugar tax has shone a spotlight on the soft drinks industry and its use of refined sugar and has opened the door for a new era of drinks that break the long established rules. We are delighted that the team at All BarOne has chosen Botanic Lab to introduce a new style of soft drink to their customers.”
All Bar One Marketing Manager, Kate Dell, says, “We’re excited to partner with Botanic Lab as part of our continued development of our drinks range, offering exciting new flavours and innovation around health and nutrition. What’s great about Botanics is that you can Vitalise on a Monday morning or Invigorate your weekend brunch, you can even pair with a premium spirit in one of our Conscious Cocktails when you’re looking for a new cocktail to try at the weekend. We genuinely believe Botanics are the perfect drink whatever you’re mood throughout the week and the team is really looking forward to selling the range.”
This year heralds ground-breaking partnerships for Botanic Lab with forward thinking bars and restaurants that are committed to offering customers a more unique drink experience whilst answering the increasing dilemma of what to drink when you’re not drinking.
BOTANICS will be available exclusively at 50 All Bar One’s across the country throughout August and September and will be rolling out to other premium on-trade accounts in 2016. Price of the drinks in All Bar One is £4.95.
Botanic Lab has a long established reputation with premium retailers such as Harrods, Selfridges and Fenwick of Bond Street, where its existing product range retails for £5.99 for 250 ml.
At drinktec 2013, WILD Flavors GmbH (WILD) will be presenting innovations for the beverage industry, demonstrating its keen understanding of current consumer trends and sharing its global market expertise. Thanks to products from WILD’s portfolio, manufacturers can breathe new life into established beverage sectors as well as new ones: beer-mix drinks, malt beverages, ready to drink (RTD) tea, energy drinks, juice and much more.
At the WILD booth, the right innovation for new growth is available for every manufacturer. As one of the leading experts in global ingredients, WILD is always on top of international markets and consumer needs, and just in time for drinktec it will be presenting its new developments. Its motto for the industry: We grow your business, naturally!®
En vogue with new beer-mixes and malt beverages
In the field of beer-mix drinks, WILD has created highlights with en vogue products such as cloudy variants with juice. Manufacturers can come to the WILD booth and experience for themselves how compelling the new flavors for these popular mixed drinks are. Non-alcoholic malt beverages are extremely promising for breweries as well as producers of soft drinks. Here WILD features a variety of options in terms of malt content and numerous fruity flavors – perfect for the many different taste preferences around the world.
Subscribing to success ― the energy-drink sector
Higher, faster, newer ― the energy drink trend keeps growing around the world. WILD is seen as one of the leading international manufacturers of ingredients for these drinks which give people new vigor. In addition to classic flavors, WILD’s portfolio also includes developments such as energy plus juice, energy plus coffee, functional energy drinks and no calorie concepts. The energy drink boom is far from being over.
On top of today’s trends: premium RTD teas
Today, manufacturers who want to offer consumers innovative new drinks with a healthy image will set their sights on premium tea beverages ― a powerful growth category. The latest addition to WILD’s selection is brewed tea, which offers new standards in terms of quality and flavor. Another attractive bonus is the fact that these products can be labeled as “brewed tea.” Manufacturers who want to concentrate on classic products based on tea extracts or tea infusions will find what they are looking for at WILD as well. For years the company has specialized in the trend segment, as its broad range of product options at the drinktec booth will confirm.
Expertise in great taste for juice and nectar
WILD’s product palette in the juice sector consists of the finest ingredients: an exquisite taste, top quality fruit and new product ideas. When it comes to compounds for juices, nectars and functional beverages with a juice content, the company is a competent partner for the industry, last not least due to its acquisition of Cargill’s juice business. Creative innovations for new product ranges in the field of juices and nectars round out what WILD has to offer.
Creating new inspiration for soft drinks
WILD is also presenting new soft drinks featuring a “grown-up” taste profile based on WILD’s newly developed fermentation technology. This process gives beverages a distinctive flavor and allows manufacturers to position products naturally. WILD also offers new flavors for soft drinks – everything from fruity to spicy, with mint ingredients or sweetened with stevia for low calorie concepts. In keeping with the stevia trend, the company also offers stevia sweetened products in other beverage categories, such as still drinks and tea beverages.
Brand-new: beverages which taste of dessert
One WILD innovation which provides an exciting taste sensation is combining fruit juice with dessert flavorings. This sweet and fruity blend is an excellent response to the demand for new thirst quenchers with a delicious flavor. WILD developed the “Delicious Duo” products on a basis of milk and emulsions. A highly promising concept around the globe – no matter whether the products are for Europe, the Middle East, Africa or America.
WILD at drinktec 2013: Hall B1, Booth 101
The Mexican market is being driven by health concerns and government reforms have pushed the growth of low sugar, healthy goods as it was announced that Mexico had surpassed the US as the country with the highest child obesity rates in the world. Among adults, in 2011, 70 % of Mexicans were overweight, with 30 % of these classed as obese compared to 68 % and 34 % of US citizens, respectively. This trend is predominantly in the rich, urban areas, with large numbers of children and adults in the poorer, rural regions still classed as underweight.
For adults, the problem seems to be longer working hours, which has led to an increase in ‘on-the-go’ consumption and a rise in the sales of fast foods. However, heightened awareness of the nutritional value of food and beverages has led to growth in the sales of packaged water and value-added drinks, such as drinking yogurt and nectars, which have supplementary calcium and anti-oxidant benefits.
In April 2011, the government declared that it would inform all Mexican children of the risks of obesity and has made this a public health issue, highlighting the seriousness of the situation. As part of this, the sale of any food or drink with an excess of 400 calories is now prohibited in schools. This has led many producers to develop drinks with low-sugar content. It has also resulted in an upsurge in the demand for ‘functional’ juice and nectars, with organic products seeing a rise in sales, despite the higher price, as they are generally viewed as healthier.
The rise in obesity has led to a rise in diabetes, further increasing the demand for low-sugar products. Despite this, low calorie variations of several soft drinks categories saw slow growth in 2011. Low-calorie carbonates grew by just over 1 %, compared to its regular counterpart, which experienced 5 % growth. Low-calorie nectars, however, saw a decline of around 17 % as it lost share to the still sweetened flavored water segment, with many producers introducing innovative new flavors.
In contrast to these negative trends, iced/rtd tea drinks saw exceptional growth throughout the year, as these products are increasingly seen as a healthy alternative to carbonates. Low calorie variants grew by around 26 %.
Additionally, regional juice producers have capitalized on the health trend by offering organic variants of soft drinks and marketing certain flavors as health drinks. Canadean expects the trend of low calorie and low sugar products to continue in 2012 and most soft drinks categories are forecast to see growth. However, this is expected to slow as the second wave of economic malaise affects businesses and consumers worldwide. Competition within the soft drinks market will remain rife, for example: juice versus nectars or carbonates versus iced/rtd tea drinks. The promotion of a healthier lifestyle will be the focus of marketing strategies and campaigns.
The information in this press release is from the report, “Mexico Soft Drinks Market Insights 2012”. More details about this report, please click here.
