ECONOMY

Coke bottler HBC sees Q1 profit beat forecasts

Coca-Cola Hellenic Bottling Co, the world’s second biggest Coke bottler, beat market expectations as first-quarter net profit more than quadrupled, helped partly by warm weather and a new light Coke drink. CCHBC said yesterday net profit rose to -25.4 million from -5.6 million in the same period in 2006 with strong growth in emerging markets and much lower restructuring costs. Net profit had been forecast at -21.8 million on average in a Reuters poll of 11 analysts. CCHBC, 24 percent owned by Coca-Cola Co, said it was confident the expansion of its existing products portfolio, planned pricing initiatives and cost management would help offset raw material cost pressures, including rising sugar prices. «With sugar we are quite covered right now for all 2007 and also partly into 2008. So I don’t think we have any risk on the sugar side,» Chief Financial Officer Nik Jhangiani told Reuters in a phone interview. He said he felt comfortable with the forecast it gave earlier this year for a 1-1.5 percent rise in the overall cost of goods sold per unit case. Cost of goods sold rose 5 percent last year. «Results were better than expected on the bottom line due to the absence of restructuring costs and the improved profitability in emerging and developing territories,» said one analyst who declined to be named. The bottler, with operations in 28 countries in Europe and Africa, said sales volumes grew 18 percent to 402.3 million unit cases thanks to a new light Coke drink and unseasonably warm weather across Europe, which boosted demand. «Our continued effort to strengthen our commercial capabilities and route-to-market effectiveness, together with favourable weather conditions, had a positive impact,» Chief Executive Doros Constantinou said in a statement. «We are also encouraged by the early consumer response to the recent launch of Coca-Cola Zero in certain of our markets,» he said. Sales revenues for the quarter rose 18 percent to -1.25 billion with double-digit volume growth in all CCHBC’s markets. The acquisition of an Italian water firm and a Cyprus bottler boosted the established segment. (Reuters)