US: CCE incomes down in "challenging conditions"
Coca-Cola Enterprises (CCE) today reported third-quarter net income US$207m, or 44 cents per diluted common share.
Year-to-date net income totalled US$514m, or US$1.09 per diluted common share.
Operating income for the third quarter totalled US$449m, down 14% versus prior year. Year-to-date operating income was US$1,204m, down 2% for the first nine months.
"We faced challenging business conditions during the quarter in both North America and Europe, including a combination of a soft retail environment, cool, wet weather, and a continuing decline in regular soft drinks," said John R. Alm, president and chief executive officer. "Despite these conditions, we achieved our pricing goals and our diet portfolio continued its strong growth. With less weather impact and anticipated growth in Europe, we believe volume trends will improve in the fourth quarter.
"Moving forward, our focus now is to ensure we implement our annual price increases successfully, and to complete our 2005 planning process with The Coca-Cola Company. Our business plan for next year will include tactics to accelerate diet brand growth, bolster regular soft drink performance, and include meaningful package and product innovation," Mr. Alm said.
Third-quarter 2004 and nine-month physical case bottle and can volume decreased 6% and 2.5%, respectively. Volume in North America declined 4% for the third quarter and 1% for the nine months.
"North American volume performance was characterized by decreased sales of regular soft drinks offset partially with growth in diet brands, Powerade and water. Europe's performance continued to be impacted by unfavorable summer weather with volume down 12% in the third quarter and year-to-date volume down 6.5%," the company said in a statement.
Net revenues per case increased 2% in the third quarter and 2.5% in the first nine months of 2004.
The statement said: "We expect reported full-year 2004 earnings per diluted common share in a range of US$1.21 to US$1.25. Excluding the second-quarter 2004 expense item of 5 cents, comparable 2004 earnings per share is expected to total US$1.26 to US$1.30. This guidance reflects the benefits of a stable North American pricing environment, marketplace initiatives in both North America and Europe, as well as continued cost control efforts."
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