Nestle expects growth in bottled water brands

VEVEY, Switzerland Nestle SA is expecting U.S. volume growth in its bottled water brands to improve over the next few months compared to last year, with some help from innovation and tropical weather.

Kim Jeffery, chief executive of Nestle Waters North America, noted on Tuesday that the lack of hurricanes last year did not spark disaster-related demand for bottled water, affecting sales. Considering the damage Hurricane Dean left in Mexico’s Yucatan Peninsula, is seems this hurricane season could help drive demand.

Jeffery also announced the company is developing new brand line extensions, noting that they will follow along the popular trend of "functionality," by adding vitamins or minerals to the beverages. "You can expect us to be extending these brands in some fashion in the coming years," Jeffery said. "Most likely in 2009."

Bottled water enhanced with functional ingredients have become the latest driving force in the beverage industry, especially since Coke paid $4.1 billion to acquire Glaceau, maker of VitaminWater, in June. According to Beverage Digest, sales of bottled water increased 11 percent in the first half of 2007.