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GB Coke bottler Coca-Cola Europacific Partners has posted a rise in underlying first-half problems despite poor weather in Europe, as growth in south east Asia and Australia boosted performance.
First-half revenues were up 9.5% on a reported basis and by 3.5% on an adjusted comparable basis.
Adjusted comparable volumes were up 0.6% for the first six months on 2024.
Europe comparable volumes were down 2.8% reflecting adverse weather, strategic delistings and cycling solid comparables.
However, its APS region saw volumes rise 7.5%, with Australia/Pacific continuing solid momentum and south east Asia seeing double-digit growth driven by demand in the Phillipines.
Overall, away from home volumes were up 1.9% and in-home down 0.6%.
Comparable revenue per unit case was up 2.9%, reflecting positive headline pricing, promotional optimisation and brand mix.
Pricing was up 4.9% in Europe due to headline price increases in GB and Germany, while APS pricing was flat.
For the second quarter of the year adjusted comparable volume was down 0.7%, with Europe down 4% and APS up 6.9%.
First-half adjusted comparable operating profit of €1.3bn was up 9%, reflecting top-line growth, efficiency programmes and continuous efforts on discretionary spend optimisation.
CCEP guided to full-year comparable revenue growth of 4%, balanced between volume and price/mix, and comparable operating profit growth of 7%.
CEO Damian Gammell said: “We are really pleased to have delivered a solid first-half performance reflecting great brands and great execution. I would like to thank our great people, alongside our customers and brand partners. We delivered solid top and bottom-line growth, and impressive free cash flow. The great performance of APS, led by the Philippines, offset softer volumes in Europe driven by adverse weather.
“This demonstrates how our geographic diversification makes us a stronger and more robust business. We continue to grow share ahead of the market and to create value for our customers. Our focus on revenue growth management, headline price and promotion strategy across a broad pack offering also drove solid gains in revenue per unit case.
“Looking ahead, we are well placed, operating in categories that remain resilient. We continue to invest for growth and have strong commercial plans in place for the rest of this year and beyond to engage customers and consumers. We remain focused on driving profitable revenue growth, actively managing our pricing and promotional spend to remain affordable and relevant to our consumers, alongside our focus on productivity and free cash flow. In that context, we reaffirm our full year guidance for 2024.
“We are confident that we have the right strategy, done sustainably, to deliver on our mid-term growth objectives. Combined with our first half interim dividend, this demonstrates the strength of our business, and our ability to deliver continued shareholder value.”
Morning update
Fellow European Coke bottler Coca-Cola HBC has made “strong growth and share gains” in the first.
The UK listed group said organic volumes grew 3.1% in the first half of the year, with strategic priority categories all driving growth.
Its sparkling range was up 0.9%, energy drinks up 32.8% and coffee up 21.6%.
It also saw further value share gains, with our share in non-alcoholic ready-to-drink products, which were up 170bps while sparkling has growth 80bps year-to-date.
In total, second quarter volumes grew 4.2%, with all segments contributing.
Organic revenue per case growth jumped 10.2%, driven by targeted revenue growth management initiatives.
The group delivered “robust” organic EBIT growth of 7.5%, with comparable EBIT reaching €564.1m.
Comparable gross profit margin grew 100bp, reflecting easing input cost inflation.
CEO Zoran Bogdanovic commented: “This has been a strong first half of the year, even as we navigated challenging environments in several markets. Focused execution behind our 24/7 portfolio drove organic revenue growth of 13.6%. Supported by continued targeted investment, we have delivered organic volume growth across each of our strategic priority categories of sparkling, energy and coffee, and further increased our value share in NARTD.
“I would like to thank our teams, along with our customers, suppliers and partners for their collaboration and passion to jointly drive growth. Special thanks to The Coca-Cola Company team, with whom we work closely across our markets with agility and speed, adapting to evolving local market trends.
“Our teams continue to execute with excellence, creating joint value with customers by leveraging our bespoke capabilities and the strength of our 24/7 portfolio. While mindful of macroeconomic and geopolitical challenges as well as a more uncertain consumer environment, we are upgrading our guidance for the year, reflecting our strong first-half performance and confidence that we can continue to win in the marketplace.”
On the markets this morning, the FTSE 100 is up another 0.9% to 8,097.5pts.
Risers so far include Just Eat Takeaway.com, up 6.3% to 994p, Ocado, up 3.9% to 396.4p and McBride, up 1.8% to 127.2p.
Fallers include Coca-Cola HBC, down 2.6% to 2,669.2p, Deliveroo, down 1.2% to 125p and AG Barr, down 0.5% to 615.7p.
Yesterday in the City
There wasn’t the sharp share price resurgence seen overnight in Japan yesterday, but the FTSE 100 clawed back 0.2% to close at 8,026.6pts having lost more than 2% on Monday.
Domino’s Pizza Group fell 7.1% to back to 287p after cutting its full-year earnings forecast as it plans to be more aggressive on pricing in the second half of the year.
The day’s risers included Kerry Group, up 7.8% to €85.40, Nichols, up 6.6% to 1,130p, Glanbia, up 5.2% to €17.82, THG, up 5% to 63p, McBride, up 3.7% to 125p and Science in Sport, up 3.5% to 23.5p.
Fallers included Bakkavor, down 3.4% to 143.5p, Hilton Food Group, down 2.2% to 874p, Naked Wines, down 2% to 52.9p, Ocado Group, down 1.3% to 381.4p, Fever-Tree, down 1.2% to 899.5p and Tesco, down 0.3% to 320.2p.
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