The world’s second largest bottler of Coca-Cola drinks, Coca-Cola Hellenic (CCH), which operates in 27 European countries, plus Nigeria, said its first-quarter net profit fell to €1.9m as the recession hit demand for soft drinks and weakened currencies in key markets.
CCH said currency devaluations against the euro in a number of key markets in central and eastern Europe, and restructuring costs of €7.7m, also weighed on the bottom line. The bottler didn’t give specific guidance for the full year, saying the economic environment remains challenging and difficult to predict. It added that foreign exchange losses were expected to continue for the rest of the year.
Doros Constantinou, MD of Coca-Cola Hellenic, said: “The first quarter of 2009 witnessed difficult trading conditions across certain key markets reflective of continued challenges in the global economic environment. However, despite lower overall consumer spending, our strong execution in the marketplace continues to drive share gains in many of our key markets, and we successfully implemented price increases in accordance with our plans. Nonetheless, continuing volatility in currency markets had a material impact on our profitability for the quarter.
“Our continuing group-wide focus on cost saving programmes, disciplined use of capital, and tight working capital management has resulted in significantly improved, free cash flow generation during the first quarter. We expect continued benefits from this ongoing focus, which, together with lower expected commodity costs, should support profitability throughout the rest of the year.
“Near-term trading conditions remain challenging and difficult to predict. However, we believe that our robust capital structure, together with the actions we’re implementing, will further strengthen our competitive position, leaving us well placed to capitalise on the positive long-term prospects of our markets.”
Source: Coca-Cola Hellenic
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