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Fizzing 2004 results from Pepsi franchisee as it prepares to go public

Dubai Refreshments Company, the sole franchisee and distributor for PepsiCo products in Dubai and Northern Emirates, has announced a further increase in profit for the 2004 financial year.

The company achieved a 27 per cent increase in sales volume and AED28 million operating profit, up 12 per cent on the previous year; meanwhile, market share in DRC territories reached 65.1 per cent.

These impressive figures, including double-digit profit growth for the third year in succession, come as the company is preparing to be listed on the UAE bourse.

According to general manager Alan Salem, the company's success over the last 12 months is particularly impressive when viewed in terms of an increasingly competitive marketplace.

He said: 'For the third year in a row, DRC has posted exponential growth. Judged in real terms, we have increased sales from 8 million raw cases a year to 18 million in 36 months. For any company to achieve 225 per cent growth in such a small period of time is an exceptional performance.

'Viewed in terms of a competitive market place, the profit margins start to look even more impressive. Dubai Refreshments has held the majority market share in the CSD category for three years now, but growth in sales volume has not come at the expense of everything else.

'The last three years has seen consistent growth, profit margins and turnover, and have put DRC in an extremely strong position to sustain this growth in the future.'

Since its launch in 2003, Aquafina, PepsiCo's international bottled water brand, has quickly become one of the leading water brands in the UAE and Oman. This exceptional performance has contributed significantly to overall volume growth, market share, and profitability.

7Up, also acquired in 2003, has achieved top-of-mind awareness in the carbonated drinks sector after a highly visible integrated marketing campaign. The drink is now the No.2 carbonated soft drink in Dubai, Sharjah and Northern Emirates - only beaten by Pepsi.

Technological investment is set to come into play through 2005, according to Salem, who said: 'We have invested substantially in operating systems, such as ERP implementation, and hand-held terminals for sales, as well as infrastructure costs, such as a new distribution and logistics facility in Sharjah.

'We see these improvements as set to help grow our bottom-line even further in the 12 months to come, as we concentrate on streamlining our operating procedures to maintain our competitiveness on price.'

New major accounts include the hypermarket Geant, as well as nearly 20 exclusive food and beverage outlets in Dubai alone.

DRC began as a limited liability company by Decree of His Highness, The Ruler of Dubai and amended its status in July 1994 to a Public Shareholding company. In 1962 DRC was appointed as the sole franchisee and distributor for Pepsi Co.

Since the factory was established in 1959, DRC has remained at the forefront of the UAE refreshments industry, continually expanding through major investment in the latest bottling technology complemented by the highest levels of quality management.

Pepsi is the second largest company in the global soft drink industry, but in the UAE is the number one soft drink - well ahead of its major competitors.

DRC's product portfolio today includes Pepsi, Diet Pepsi, 7UP, Diet 7UP, Mountain Dew, Mirinda Orange, Mirinda Green Apple, Shani, Evervess Soda, Evervess Tonic, Evervess Ginger Ale, and Aquafina pure drinking water.



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