14th Feb 2014 08:17
LONDON (Alliance News) - Coca-Cola HBC AG, Europe's largest bottler of Coca-Cole products, Friday said it swung to a net profit in the fourth quarter of 2013 as it boosted margins by cutting costs and volume growth returned.
The company, which moved its listing to London from Athens last year, reported a net profit of EUR8.4 million for the quarter, compared with a loss of EUR45.8 million a year earlier. Its profit for the whole year rose to EUR221.2 million, from EUR190.4 million.
Coca-Cola HBC was hit by the economic crisis in Europe as sales in southern Europe fell sharply. Volumes have now started to recover in those markets, but are dropping elsewhere.
It said net sales revenue was EUR1.58 billion in the fourth quarter, down from EUR1.61 billion a year earlier. Annual revenues dropped to EUR6.87 billion, from EUR7.05 billion.
Volumes were up 1% in the fourth quarter as a 4% increase in emerging markets was partly offset by a 5% decline in developed markets. For the year as a whole, volumes were down 1% as a 2% increase in emerging markets was more than offset by a 4% decline in established markets and a 3% decline in developed markets.
It said it gained volume and value share in sparkling beverages in 20 out of our 24 markets including Austria, Greece, Ireland, Italy, Switzerland, the Czech Republic, Romania, Russia, Serbia and Ukraine.
The profitability improvement was driven by mainly by cost cutting, which more than offset higher input costs.
Its comparable earnings before interest and tax rose 23% in the fourth quarter as revenue growth initiatives and higher volume more than offset total input cost increases in absolute terms. It said operating expenses as a percentage of net sales revenue declined by 130 basis points, more than offsetting unfavourable foreign currency movements. It comparable EBIT margin increased by 90 basis points, it said.
It said it is proposing a dividend of 35.4 euro cents, up from 34.0 cents a year ago.
"Based on these results and against the backdrop of continuing economic difficulties and volatility in our territories, we are cautiously optimistic about the year ahead," Chief Executive Dimitris Lois said in a statement.
Coca-Cola HBC shares were down 0.3% at 1,584 pence early Friday.
By Steve McGrath; [email protected]; @SteveMcGrath1
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