AUS: Coca-Cola Amatil profits rise in '08

Coca-Cola Amatil has reported a 10% rise in profits for 2008 and above average volume growth in its core Australian drinks division for the first six weeks of 2009.

Coca-Cola Amatil (CCA) said today (12 February) that net profit for the 12 months of 2008 rose by 10% to A$404m (US$261.5m).

The rise came in spite of a 6% decline in group sales, to A$4.26bn, compared to the same period last year. Revenue from continuing operations increased by 5.4%, however, the company added.

Managing director Terry Davis said: "CCA has delivered a record profit result against a backdrop of the most challenging economic and trading environment we have experienced for many years.

"The achievement of this result came through the continued strong performance of the Australian and New Zealand beverage businesses, an excellent result from Indonesia & PNG and the increasingly important contribution from our premium alcoholic beverages business."

Record summer temperatures in Australia throughout January have provided CCA with a strong start to the year, the group said. "CCA's Australian beverage business has seen well above average demand and has delivered high single-digit volume growth for the first six weeks of the new year," the firm said.

Beverage operations outside Australia, CCA said, have also reported a strong start to 2009.

It added that it has implemented price increases across its portfolio in order to offset higher costs.

Commenting futher on the group's recent rejection of a A$7.7bn takeover bid from Lion Nathan, CCA said the proposed offer was well below payments made for other recent takeovers in the sector.

Lion Nathan's proposal represented 10.8 times CCA's 2008 operating profit (EBITDA), CCA said. However, the firm noted that Asahi had agreed to buy Cadbury's Australian beverages division for 15 times the business' EBITDA in January.

Lion Nathan walked away from its bid earlier this week, after talks broke down between its parent firm, Kirin Holdings, and The Coca-Cola Co, which owns 30% of CCA.