CCHBC fizzing

Related tags Cent Coca-cola

Coca-Cola Hellenic Bottling Company has delivered strong financial
results during the first nine months of the year. However, while
most of Europe basked in the warm summer weather, some key
countries within our emerging market segment, especially Russia,
had a poor summer.

Coca-Cola Hellenic Bottling Company has delivered strong financial results during the first nine months of the year, reporting a 27 per cent growth in operating profit (EBIT) and a 13 per cent increase in EBITDA. However, while most of Europe basked in the warm summer weather, some key countries within our emerging market segment, especially Russia, had a poor summer. This is reflected in poor third quarter volume growth of 10 per cent.

Both of the company's newly acquired water businesses, Valser in Switzerland and Dorna in Romania, continued to deliver solid results. In the first nine months of 2003, they contributed approximately 3 per cent to volume growth and 2 per cent to EBITDA growth. In line with the group's strategy to strengthen its presence in the rapidly expanding non-carbonated soft drinks sector, the company has announced two further water acquisitions this year.

In October, the group completed the joint acquisition with The Coca-Cola Company (TCCC) of 100 per cent of the shares of Multivita, the Polish mineral water company. In addition, the acquisition of 100 per cent of the Austrian mineral water company Romerquelle by CCHBC, is expected to close in December 2003. According to CCHBC​, these acquisitions will have not have a material impact on our 2003 results.

Unit case volume was 430 million for the first nine months of 2003, 6 per cent above prior year, and 157 million in the third quarter, 12 per cent above prior year. The established markets benefited the most from the exceptionally warm summer weather compared to 2002, in particular Italy, Austria and Switzerland. In addition, Italy also benefited from the significant progress in its local market execution plan and is well-positioned to deliver full year 2003 volume growth of approximately 6 per cent.

Established markets contributed €302 million to group EBITDA for the first nine months, 14 per cent above prior year, and €120 million for the quarter, 20 per cent above prior year. EBITDA growth in this segment was driven primarily by Italy, through both volume growth and cost management and a continued shift towards the more profitable immediate consumption packages.

Developing markets contributed €88 million to group EBITDA for the first nine months, 5 per cent above prior year and €41 million to group EBITDA for the quarter, 7 per cent up versus the prior year. EBITDA in developing markets continues to be negatively impacted by the loss of toll filling contracts as a result of the German deposit legislation, an issue that has been covered by FoodProductionDaily.com​.

Romania continued to perform exceptionally well in the third quarter, ending the first nine months with strong double digit volume growth assisted by new product launches and strong performance from the addition of the Dorna water portfolio. Despite exceptionally poor summer weather conditions, Russia is on track to deliver volume growth of approximately 10 per cent for the full year 2003.

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