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Cott profit slips on lower sales volumes, revenue

Plastic bottles filled with soda prior to be labelled are carried on conveyor belt at the soft drink maker Cott's bottling plant near Pearson Airport, Toronto.

Fernando Morales/The Globe and Mail

Cott Corp. earned a second-quarter profit of $25-million (U.S.) in its latest quarter, down from $27-million a year ago, as the beverage maker reported lower sales volume and revenue.

The company said the profit amounted to 26 cents per share, down from 28 cents per share a year ago.

Revenue totalled $626-million, down from $640-million.

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The average analyst estimate had been for a profit of 25 cents per share on $612-million in revenue, according to estimates compiled by Thomson Reuters.

Despite the drop in revenue and profits, Cott chief executive Jerry Fowden said the company improved its gross margins, a key priority.

"Lower volume and revenue reflected a combination of this previously communicated shift in prioritizing margin restoration versus volume and revenue growth as well as poor weather in the UK," Fowden said.

"Overall, I believe we had another solid quarter as we continue to improve the business and margin mix."

Gross profit as a percentage of revenue was 14.7 per cent for the quarter compared with 12.1 per cent in the first quarter of 2012 and 13.8 per cent in the second quarter of 2011.

Cott is the world's largest distributor of store-brand beverages, with about 4,000 employees and soft drink, juice, water and other beverage bottling plants in the United States, Canada, the United Kingdom and Mexico.

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