Price increases and cost-cutting helped FTSE 100-listed soft drinks bottler Coca-Cola HBC AG (LON:CCH) increase its full-year profits though revenue growth was impacted by currency fluctuations and weakness in Russia.
The group - which bottles, sells and distributes Coca-Cola drinks in 28 countries, mostly in Europe – saw its 2016 like-for-like earnings per share rise by 12.5% to €0.97, though net revenues fell by 2% to €6.2bn.
Excluding the impact of currency fluctuations, Coca-Cola HBC’s revenues were up 3% helped by the price increases, mainly in emerging markets.
In the results statement, chief executive Dimitis Lois said: "In 2017, we expect slightly better economic conditions to support volume growth.”
He added: “We are confident that 2017 will be a year of currency-neutral revenue growth and margin expansion as we continue to make progress towards our 2020 targets."
In a note to clients, Shore Capital analysts Phil Carroll said “overall, a beat for the year on arguably well-managed expectations but one point we would raise is the improvement in profitability in the established markets whilst seen in part at the interim stage was not really a function of a strong trading performance but about removal of cost”.
He added: “Where we are more cautious is on input costs which are expected to growth high single digits on a FX neutral basis. This could be a significant issue, in our view, which we will need to assess in more detail.”
In early trading, Coca-Cola HBC’s shares on the FTSE100 index edged 3p lower to 1.820p.
The firm is seen as a possible bidder for the 57% stake in its African arm that Coca-Cola Co. (NYSE:KO) is putting up for sale following the takeover of its partner SABMiller by Anheuser-Busch InBev.
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