Pepsi image cropped

Pepsi’s growth in Europe was hit by shortages for Walkers Crisps

Soft drinks giants Coca-Cola and PepsiCo have enjoyed double-digit sales growth in the final quarter of 2021 on the back of price increases and continued demand as consumers return to pre-pandemic habits out of the home.

Both groups were able to counter higher costs for packaging, labour and shipping by leaning on pricing, but Coke and PepsiCo’s forecast lower growth in 2022, indicating a potential softening in demand as inflation hits households around the globe.

PepsiCo guided for 6% organic sales growth this year, compared to 9.5% in 2021, while Coke predicted a rise of 7% to 8%, down from 16% last year.

A 12.4% increase in revenues in the fourth quarter helped Pepsi grow net sales for the year by 12.9% to $79.5bn (£58.7bn), with Coke up 10% in the final three months of the year and by 16% to €38.7bn (£28.6bn). The companies were helped by coming up against weaker figures from a year ago as lockdown restrictions hurt the out-of-home market.

Operating profits for the year at Pepsi rose 11% to $11.2bn and by 15% at Coke to $10.3bn.

However, Pepsi’s profits and sales were hit in Europe during the fourth quarter as a result of the IT issues that led to a widespread shortage of Walkers Crisps.

“These issues were largely resolved within the quarter and the business operations had resumed by year end,” Pepsi said.

CEO Ramon Laguarta added: “Our full year net revenue growth meaningfully accelerated in 2021 versus the previous year

and this gives us added confidence that the investments we’ve made in our people, brands, innovation, supply chain, go-to-market systems and digitization initiatives are working.

“Moving forward, we remain committed to building advantaged capabilities that can help us win in the marketplace and become an even faster, even stronger and even better organization.”

Coke CEO James Quincey said that while the environment remained “dynamic” in 2022, he expected the group to build on last year’s momentum to drive topline growth.

“In 2021, our system demonstrated resilience and flexibility by successfully navigating through another year of uncertainty,” he said.

“We focused on our key strategies and emerged stronger. We are confident that progress on our strategic transformation has made us a nimbler total beverage company.”

Coke’s sparkling soft drinks category grew 8% for the quarter and 7% for the year, with trademark Coca-Cola up 7% for both the quarter and the year and Zero Sugar in double-digit growth.

Prices increased 10% across the final quarter and 6% for the year as a whole.