OPERATIONAL OVERVIEW / GEPP
OPERATIONAL OVERVIEW
GEPP OUR BEVERAGES BUSINESS

GEPP has evolved as the sole beverages distributor with nationwide coverage and presence in Mexico, and is one of the largest distributors of jug water in the country. GEPP has two plastic manufacturing plants, producing approximately 70% of the PET bottles and 90% of the PET caps used in its bottling processes.

GEPP is the exclusive distributor of the PepsiCo beverages brand in Mexico. It also distributes its own brand as well as third party brands. GEPP produces, bottles and distributes a broad portfolio of beverages such as sodas, juice-based drinks, iced tea, sports drinks, and purified water.

SINCE ESTABLISHING GEPP, WE HAVE INVESTED OVER US$ 500 MILLION IN THE MODERNIZATION OF INFRASTRUCTURE TO OPTIMIZE PROCESSES

During 2014, total revenues in the beverage division increased 0.8% to Ps.31,449 million.

Sales volumes of carbonated and noncarbonated bottled drinks increased by 0.4% to 810 million eight ounce cases in 2014, compared to 806.9 million eight ounce cases in the previous year.

In addition, GEPP sells 10.1 and 20 liter jug water of various brands distributed directly through home delivery, currently serving more than 2.5 million customers, of which approximately 85% are Mexican families. At the close of 2014, the sales volume of the jug water segment was the equivalent of 804 million eight-ounce cases, a 0.4% increase compared to 2013.

SALES VOLUME OF CARBONATED AND NONCARBONATED BOTTLED BEVERAGES1

MILLIONS OF 8 OZ. CASES

0.4%

INCREASE 2014 VS 2013

1 Bottled Bevereges includes bottled water in less than 5 liter presentations


SALES VOLUME OF JUG WATER
.

MILLIONS OF 8 OZ. CASES

0.4%

INCREASE 2014 VS 2013

GEPP CONTINUES TO FOCUS ON DEVELOPING STRONG BRANDS WITH NATIONWIDE COVERAGE, ADDING STRATEGIC PRODUCTS TO SUPPORT VOLUME GROWTH. SOME EXAMPLES ARE THE RECENTLY LAUNCHED EXTENSIONS IN THE EPURA® AND BARRILITOS® BRANDS.

2014 ACTIONS
1

Through the cost savings program that began in late 2013, and which was executed during 2014, GEPP has managed to offset most of the impact of the low sales volume and below-inflation prices that resulted from the excise tax.

2

Several back-office functions have been centralized and optimized through the Shared Services Center launched in Guadalajara, Jalisco, resulting in greater cost efficiencies.

3

During 2014, the Logistics Excellence Program was implemented; leading to greater efficiencies in storage and transportation while optimizing capacity and assets utilization.

4

The beverages division launched Epura Bebé®, in a 330 ml presentation, with focus on the children’s market. The product was well-received by consumers. Similarly, new flavors of Jumex Fresh® were added to the beverages portfolio. Additionally, the Barrilitos® brand was introduced in territories where GEPP does not manage the distribution of the Jarritos® brand.

5

Specific channel strategies were successfully implemented to increase national coverage of retail distribution and also to maintain the growth of direct distribution.

DISTRIBUTION NETWORK

GEPP continues to work on the modernization of its extensive nationwide distribution network, planning more efficient routes and leveraging new territories. This has allowed GEPP to grow both modern and traditional channels with bottled beverages reach, as well as to expand its direct jug water distribution to consumers.

PORTFOLIO OF GEPP BRANDS

PepsiCo Brands

Pepsi Cola®

Pepsi Cola Retro®

Pepsi Light®

Pepsi Kick®

Pepsi Max®

Pepsi Natural®

Pepsi Twist®

Seven Up®

Seven Up Diet®

Seven Up Libre®

Seven Up Light®

Seven Up Mojito®

Mirinda Naranja®

Mirinda Naramango®

Mirinda Mango®

Mirinda Naranzul®

Mirinda Fresa®

Mirinda Uva®

Mirinda Fiesta®

Mirinda Frutas®

Manzanita Sol Roja®

Manzanita Sol Libre®

Manzanita Sol Verde®

Manzanita Sol Exótica®

H2oh!®

Kas ®

Rey®

Okey®

Sangría Casera®

Be Light®

Sobe®

Lipton®

Lipton Light®

Mountain Dew®

Propel®

Gatorade®

G2®

G Series®

Power Punch®

Exótica®

Vita®

Proprietary brands

Trisoda®

Santorini®

Junghanns®

Acqua di Roma®

Montebello®

Plus®

Epura®

Electropura®

Mr. Q Juicy®

Garci Crespo Sabores®

Garci Crespo Mezcladores®

Spin®

Spin Citrus®

Spin Citrus Natura Sweet®

Agua Glacial®

Aguas Frescas Electropura®

Hielo Electropura®

San Lorenzo®

Manzana Corona®

Third-party brands

Petit®

Jarritos®

California®

Ginger®

Club Soda®

Quina®

Rock Star®

Squirt®

Squirt Citrus®

Squirt Light®

Canada Dry®

Jumex Fresh®

Sangría Señorial®

Titán®

Starbucks®

Barrilitos®

Ok®

Toronjita®

El Rey®

Corona®

Fruco®

Plus Mineral®

Montebello®

MARKETING CAMPAIGNS

The marketing campaigns launched by the beverages division during 2014 for key brands such as Pepsi®, Epura®, Jarritos® and Jumex Fresh® contributed to the strengthening of the brands.

 
Information for investors
México

Organización Cultiba
Diana González Flores
Investor Relations
+52 (55) 5201-1947
dgonzalez@gamsa.com.mx

 

Monte Cáucaso 915, fourth floor,
Colonia Lomas de Chapultepec
C.P. 11000, México, Distrito Federal
Tel. +52 (55) 5201-1900
www.cultiba.mx

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