Coca-Cola HBC released its half-year results this week

Coca-Cola HBC released its half-year results this week

Earlier this week, Coca-Cola HBC released its Q2 and H1 results. Here, just-drinks takes a closer look at the company's performance by region.

  • Established markets

Half-year volumes were down by 4%, with sales by value from established markets slipping by 3%. In the three months to the end of June, volumes dipped by 2%, while sales in value terms were flat.

"Lower volume and to a lesser extent unfavourable category mix were more than offset by the benefits of favourable package and price mix," the company said.

Volume decline in Italy moderated to mid single-digits in Q2, "in line with our expectations". Coca-Cola Zero saw sales increase by 6%. CCHBC flagged a still-challenging trading environment in the country.

Greece saw volumes slip by low single-digits in the quarter, with half-year volumes growing by low single-digits. "Trading conditions are still challenging, unemployment remains at near-historic highs of 26% and disposable income is not forecast to return to growth until 2015."

Switzerland was down by low single-digits in both Q2 and H1, while volumes in Ireland were up by mid single-digits in Q2 and by low single-digits in H1. 

  • Developing markets

Volumes struggled in developing markets, falling by 7% in the half-year and by 5% in Q2. Consequently, sales in value terms were down by 4% and 4% in H1 and Q2, respectively.

"Volume performance in the (developing markts) segment has been impacted by our strategic decision to focus on value-accretive volume, particularly in Poland and the Czech Republic," the company said.

In Poland, sales fell by high single-digits in both periods, as CCHBC has not yet seen positive trends in unemployment and disposable income translate into consumer spending. In Czech, the company struggled, with high single-digit falls in second quarter volume and a low teens decline in H1.

Hungary, however, posted growth of low single-digit volumes in the two periods. "This is the third sequential quarterly improvement (from Hungary) and the first positive quarter following eight consecutive quarters of decline."

  • Emerging markets

In the half-year, volumes from emerging markets fell by 2% and by 3% in Q2. Sales in value terms fared worse, dropping by 9% in H1 and by 10% in the quarter. "Positive pricing and package mix were not enough to compensate for the negative impact from currency translation and volume weakness."

A low single-digit decrease in Q2 volumes in Russia contributed to a similar fall in half-year volumes. CCHBC blamed the "current geopolitical developments impacting the economy" for the quarterly performance.

Nigeria volumes were up by mid single-digits in Q2 and by low single-digits in the half-year. In Romania, volumes (-10% in Q2, high single-digit fall in H1) were pressured by a difficult trading environment and competitive promotional pressures.

Ukraine saw volumes drop by high single-digits in the second quarter and by low double-digits in the first six months of 2014. "The current political environment remains very difficult, severely impacting consumer demand," CCHBC said.