AUSTRALIA: Amatil sales up in first quarter
Australian soft drinks group, Coca-Cola Amatil Ltd, reported first quarter sales of A811.1m, up 1.9% from the first quarter of last year. The company, which is 35%-owned by Coca-Cola, said profit growth for the 2002 calendar year would be towards the upper end of its forecast range of 10% to 15%, in spite of "very difficult" conditions in Indonesia.
"We are shifting our focus to profitable revenue generation rather than volume growth for the sake of volume growth," said CCA managing director Terry Davis.
While sales grew in the first quarter, Amatil said volumes fell by 0.5% to 143.6m cases as a result of a 19% decline in volumes in Indonesia. With Indonesia stripped out, group volumes were 4% higher and revenue rose by almost 3%. The best-performing market for Amatil was South Korea where sales grew by 6.7% to A$181.9m.
The company also announced that it its extensive "back to basics" review had identified cost savings of A$30m a year. The company has also selected A$200m worth of non-core assets for possible disposal.
Amatil added that it was negotiating with potential buyers for its Australian and New Zealand PET bottle manufacturing business valued at around A$140m. Funds from disposals are to be channeled back to Australia to reduce the company's A$2 billion debt.
With the emphasis on divestment of non-core activities and cost-cutting, Amatil said it was not seeking any major new territories from Coca-Cola. However, Davis said the company would consider small Asian territories. He said Amatil would look at acquisitions in the A$20 to A$50m range, adding that the company was currently reviewing a number of acquisition options.
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