ECONOMY

CCHBC triples profit in ’03

Greek bottler Coca-Cola HBC (CCHBC) yesterday beat expectations by slashing its fourth-quarter loss and said it aimed to boost net profit this year by up to 30 percent after more than tripling it in 2003. The world’s third-largest bottler of Coca-Cola products by sales volume said full-year net profit rose to 115 million euros ($145.7 million) from 35 million, above analysts’ and the company’s own forecast of around 100 million euros. For the seasonally weak fourth quarter, its loss narrowed to 18 million from 47 million a year earlier, compared with a 30-million-euro forecast in a Reuters poll of 14 analysts. CCHBC shares were up 1 percent at 17.52 euros in midmorning trade, outperforming the broader market which was up 0.74 percent. CCHBC Chief Executive Doros Constantinou told Reuters the company brought forward price increases in seven countries to the fourth quarter that had been planned for this year. He said profit was also boosted by better-than-expected Christmas sales and a favorable product mix. He said the bottler expected little impact from this August’s Olympic Games in Athens on the overall results. «We expect a single-digit rise in sales in Greece due to the Olympics, thus we don’t see any significant impact from the Games,» Constantinou said. The group, which operates in 26 countries, does not break down results for individual markets. For 2004, CCHBC said it was targeting interest, tax, depreciation and amortization (EBITDA) growth at 10 to 12 percent on volume growth of 6 to 8 percent and a net profit of between 140 and 150 million euros. Analysts said Poland, Russia and other markets of the former Soviet bloc and new European Union members as well as Italy were likely to continue driving growth for the bottler. Analysts said lower than initially expected tax costs in Italy also helped fourth-quarter results, while the euro’s rise versus the dollar weighed on sales but resulted in lower dollar-denominated material costs, helping CCHBC’s gross profit. «The smaller-than-expected loss in the fourth quarter is mainly due to a tax benefit as well as an improved operational profit after selective price increases and successful cost containment,» said analyst Costas Theodorou at National Security. CCHBC benefited last year from a hot summer and a milder-than-usual winter. It said 2003 sales grew 5 percent to 4.06 billion euros, with the Italian market posting a turnaround and Russia recording its first net profit. Full-year group earnings before EBITDA increased 15 percent to 665 million euros. Chief Financial Officer Bill Douglas said the increase in the 2003 dividend will correspond to the one given out last year, implying a 1-cent rise to 20 cents. The figures, based on International Accounting Standards, are not directly comparable with 2002 because the company consolidated two mineral water companies it had acquired in 2002.