- Palate-pleasing first half growth
- Coke bottler lifts guidance
- EPS miss weighs on shares
Beverages behemoth Coca-Cola HBC (CCH) raised its full-year guidance after serving up strong growth with further market share gains in the half ended 28 June 2024.
However, shares in the FTSE 100 firm failed to fizz higher on the positive news, softening 3.2% to £26.52 as investors focused on a modest first half EPS (earnings per share) miss and a cautious tone to the outlook.
Coca-Cola HBC said it expected the macroeconomic and geopolitical backdrop to ‘remain challenging in the second half’ due to ‘a more uncertain consumer environment’.
This prompted some profit-taking with the shares having gained 15% year-to-date.
LIFTING THE GUIDE
Coca-Cola HBC raised its organic revenue growth guidance for the year from between 6% and 7% to an 8% to 12% range following its robust first half showing.
The company also hiked its organic EBIT (earnings before interest and tax) growth guidance to a 7% to 12% range, having previously forecast a rise of between 3% and 9%.
Geographically-diversified – the company operates everywhere from Greece, Italy and Poland to Ukraine, Egypt and Nigeria – Coca-Cola HBC delivered organic sales growth of 13.6% in the first half.
The resilient company managed to navigate ‘challenging environments’ in several markets as well as currency headwinds in Egypt and Nigeria that nibbled into its emerging market profits.
Growth reflected price increases as well as a 3.2% rise in volumes to the best part of 1.43 billion, with all of Coca-Cola HBC’s ‘strategic priority categories’ of Sparkling, Energy and Coffee driving growth.
SHOUT OUT TO ATLANTA
While first-half operating profit bubbled up 7.5% to €564 million, a smidgeon ahead of the €563 million called for by consensus, EPS fell 1.7% year-on-year to €1.04, shy of the €1.08 the market was looking for after the company swallowed higher finance costs.
Chief executive Zoran Bogdanovic highlighted further market share gains in NARTD (non-alcoholic ready-to-drink) and gave ‘special thanks’ to the team at Atlanta-based Coca-Cola (KO:NYSE), ‘with whom we work closely across our markets with agility and speed, adapting to evolving local market trends.’
