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PepsiCo steps up innovation in formulation to meet health demand

By Lindsey Partos , 22-Mar-2010

Food and beverage behemoth PepsiCo pledges to cut fat, salt and sugar across key global brands over the next ten years as demand for health-positioned products gains momentum and the Frito-Lay maker underlines wellness to deliver long-term growth.

The US firm - that claims 19 'billion dollar' food and beverage brands - announced on Monday a 25 per cent fall in average salt levels by 2015. Further, by 2020 sugar levels would be slashed 25 per cent and average saturated fat levels per serving would drop by 15 per cent.

The commitments, announced ahead of a two-day investor conference, "reflect our focus on profitable, long-term growth and will guide us as we continue to build a portfolio of enjoyable and wholesome foods and beverages," said Indra Nooyi, PepsiCo chairman and chief executive officer.

"We are stepping up our science-based innovation to serve increasingly health-conscious consumers," she added.

In their bid to arrest soaring figures for diabetes, cardiovascular disease, high blood pressure and other conditions, government and consumer groups have roundly exerted pressure on the global food industry to slice salt, sugar and fat ingredients from their product formulations.

Most Americans, for example, consume about twice the recommended daily amount of salt, according to the Centers for Disease Control and Prevention. Dietary Guidelines for Americans rubber stamped in 2005 recommend imiting sodium (salt) to less than 2,300 mg per day, about one teaspoon, whereas the average daily sodium intake for US citizens aged 2 years and up is 3,436 mg.

In 2008, PepsiCo, along with the number one food maker Nestle and a clutch of other food and beverage players, signed up to the 'Global Commitment to Action on the Global Strategy on Diet, Physical Activity and Health'.

Outlined in a letter to the World Health Organisation (WHO), and nestling next to a raft of commitments, the group confirmed it would "reformulate our existing products and develop innovations that offer healthier options".

According to Nooyi, the pledge this week from PepsiCo to reformulate a swathe of its 'muscular' food and beverage product portfolio "are action steps that directly address the key WHO commitments".

In this vein, the owner of Quaker said it aims to bolster whole grains, fruits and vegetables, nuts, seeds and low-fat dairy across its product range, and will display calorie count and 'key nutrients' on food and beverage packaging by 2012.

Health and wellness are set to feed into performance goals for the US firm. On Monday the maker of Gatorade sports drink disclosed a raft of performance goals, among them the aim to grow international revenues at two times real global Gross Domestic Product growth rate and to grow market share in savory snacks and 'liquid refreshment beverage' in the top 20 markets.

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