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Bottler Coca-Cola HBC lifts sales outlook

Published 08/09/2023, 02:12 AM
Updated 08/09/2023, 05:05 AM
© Reuters. FILE PHOTO: Bottles of Coca-Cola are seen at a Carrefour Hypermarket store in Montreuil, near Paris, France, February 5, 2018.  REUTERS/Regis Duvignau/File Photo
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By Radhika Anilkumar

(Reuters) -Coca-Cola HBC lifted its annual revenue forecast on Wednesday as the bottler benefited from higher prices despite a dip in first-half organic volumes and currency headwinds in key market Nigeria.

The Switzerland-based company has carried out the majority of planned price rises across its regions, but does not rule out adjustments in four or five markets, CEO Zoran Bogdanovic said in an interview, without naming those markets.

"I would say maybe some tactical price adjustments toward the end of the year, but bulk of our price increases that were planned for this year have been done."

HBC, in which U.S. beverage giant Coca-Cola (NYSE:KO) owns 20%, now expects a mid-teens percentage rise in organic revenue growth this year, compared with prior guidance of 5-6% growth.

Nigeria saw a low-single digit percentage decline in volumes during the first half due to a temporary lack of availability of the naira currency.

However, volumes in the region returned to growth in the second quarter, leading the CEO to project growth for the rest of the year.

Despite the slowdown in volumes, revenue increased by 18.4% in the company's emerging markets portfolio for the first six months through June, boosted by price hikes.

Inflation in Nigeria, Africa's largest economy, which has been in double digits since 2016, reached 22.79% in June and the naira tumbled to record lows in July.

Diageo (LON:DGE), the world's biggest spirits maker, said last week a dip in its annual sales volumes was largely related to its East African business, where it had raised prices to keep up with inflation and currency devaluations.

HBC reported a comparable operating profit of 560.7 million euros ($615.5 million) for the half-year, beating analysts' average forecast of about 521.5 million euros.

© Reuters. FILE PHOTO: Bottles of Coca-Cola are seen at a Carrefour Hypermarket store in Montreuil, near Paris, France, February 5, 2018.  REUTERS/Regis Duvignau/File Photo

At 0830 GMT, its shares were up 1.5% at 2,294 pence.

($1 = 0.9110 euros)

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