AUS: Coca-Cola Amatil expects FY profits rise, but domestic volumes hit

Coca-Cola Amatil's (CCA) second-half domestic volumes have been hit by “price-driven competitor activity” but it still expects to report a 4-5% rise in group net profits for the full year. 

In a trading update today (12 December), the North Sydney-based group predicted it will register sales and volumes growth by its year-end. Its H1 results saw a 4% rise in operating profits as net sales were up by 9% to AUD2.4bn (US$2.5bn).

In Australia, consumer spending levels remain “soft”, the group's MD Terry Davis said, while “price-driven competitor activity during the second half has restrained volume growth”. But, he added: "We have continued to gain market share across the year and have made a solid start to the Christmas season across most of Australia." 

The group also revealed today it has entered into a "long-term" exclusive agreement to distribute Swedish cider brand Rekorderlig in Australia from January 2014.

In New Zealand and Fiji, CCA said it expects to record a fall in volumes and earnings for the full year, as the economy has continued to affect consumer confidence in H2. 

But the group sounded a more positive note on Indonesia and Papua New Guinea. Second-half volumes and earnings have been "driven by the increase in demand for commercial ready-to-drink beverages supported by a strong product innovation pipeline, improved operational capability and innovative marketing programmes by The Coca-Cola Co".

CCA said it has also purchased the PT San Miguel Indonesia Food and Beverages non-soft drinks bottling assets in Jakarta, Indonesia and completed the acquisition of an 18,000 sqm warehouse in Lae, Papua New Guinea for AUD28m. 

Shares in the group were today down by 2.59% at AUD13.56.