CCA’s group managing director, Terry Davis, said: “CCA has delivered a record profit result against a backdrop of the most challenging economic and trading environment we’ve experienced for many years.
“The achievement of this result came through the continued strong performance of the Australian and New Zealand beverage businesses, an excellent result from Indonesia and Papua New Guinea, and the increasingly important contribution from our premium alcoholic beverages business.”
Product launches included Glacéau Vitamin Water and a 50cl Mother energy drink in Australia, as well as Coke Zero and Minute Maid Pulpy in Indonesia.
Glacéau, launched in February 2008, was the largest non-carbonated beverage launch in CCA’s history, selling more than two million unit cases, achieving over 40% penetration in the immediate consumption channel.
The reformulated Mother energy drink in a larger 50cl can was successfully launched in July and delivered volume of almost 1.8 million unit cases. According to CCA, it has captured over 25% of the highly competitive energy market in the grocery channel, up from less than 10% in 2007.
While the average cost of goods sold per unit case for the full year increased by 3.1% due to a combination of factors including an increase in cost of raw materials, this was fully recovered in each country through increased rate realisation of an average of 3.6%.
Australia delivered a record result with EBIT growth of 9.5% to A$488.4m. Despite a small decline in volume of 1.1% for the full year, improved demand, particularly for immediate consumption, single-serve products drove positive volume growth in the second half. Incremental earnings from CCA’s premium alcoholic beverages business contributed approximately 17% of 2008 profit growth in Australia.
Coca-Cola, Sprite and Fanta Flavours all achieved volume growth, while in non-carbonated beverages, Nestea achieved excellent volume growth of almost 20% and Pump delivered volume growth of 6%.
Goulburn Valley fresh flavoured milk also continued to perform well, achieving strong volume growth and growing market share in Western and Southern Australia, where it was launched during the year. Revenue from the sale of Goulburn Valley juice and fresh flavoured milk increased by approximately 10% to almost A$70m.
The contribution from alcoholic beverages was approximately 17% of the full year EBIT growth of the Australian beverage business. This contribution came from the manufacturing of the Jim Beam range of alcoholic ready-to-drink beverages and various service fees and sales incentives from the distribution of Pacific Beverages’ premium beer brands and the Maxxium ARTD and spirits portfolio.
Pacific Beverages Alcoholic Beverages JV achieved volume growth of more than 100% for its premium beer brands as a result of new product developments such as Miller Chill.
The New Zealand and Fiji region delivered EBIT growth of 7.2% for 2008 on volume growth of 1.0%. Indonesia and Papua New Guinea gave a full-year EBIT result of $50.6m, an increase of 37.5% on the prior year, while revenue grew by 17.5% and volume growth 8.0% .
In New Zealand, volume growth was driven by the continued growth of Brand Coke and Powerade, the successful launch of Relentless energy drink, successful All-Blacks Powerade and 2008 summer marketing campaigns, together with increased sales of multipack cans in the grocery channel.
In carbonated beverages, the Coca-Cola brand grew volume by 2%, while Fanta and Sprite delivered volume growth of over 1%.
In non-carbonated beverages, Powerade increased volume by over 8% while Relentless energy drink, launched in April, captured over 7% of the highly competitive energy market. Glacéau Vitamin Water was also successfully launched in November.
In January 2009, New Zealand also acquired the Baker Halls cordial brand which enjoys a 30% share of the New Zealand cordial market.
In Indonesia, Coke achieved growth of over 19% as a result of the Coke Zero launch, while Indonesia’s carbonated beverage portfolio delivered a 7% volume growth overall.
Capital expenditure in 2009 is expected to be approximately 7% of revenue.
CCA has a range of product and package innovations in the pipeline for 2009, including the roll-out of Goulburn Valley fresh flavoured milk in New South Wales, Victoria and Queensland during the third quarter of 2009. In premium beer, Pacific Beverages will launch Peroni Leggera, an authentic Italian premium, low-carb beer in Australia in March.
According to Reuters, shares in CCA rose as much as 5.6% after the results, a much needed boost following the slump caused by the failed deal between Lion Nathan and Coca-Cola.
© FoodBev Media Ltd 2024