EUROPE: Coca-Cola Enterprises announces share buyback
Coca-Cola Enterprises to buy back more shares
Coca-Cola Enteprises is planning to launch a fresh scheme to buy back US$1bn of shares, as the bottler's current buyback programme nears completion.
Coca-Cola Enterprises said today (12 September) that it plans to launch another buyback scheme next year. The bottler will purchase at least $500m of its own shares in calendar 2012, but aims to double this figure for the total programme. It gave no end date for the new scheme.
The move will raise doubts about how seriously Coca-Cola Enterprises is entertaining a foray into the mergers and acquisitions arena. The bottler has the option of purchasing Coca-Cola Co bottling operations in Germany, as part of Coca-Cola's acquisition of CCE in North America.
CCE issued a qualifier along with its share purchase statement. "These plans may be adjusted depending on economic, operating, or other factors, including acquisition opportunities," it said.
The bottler is three-quarters of the way through its current $1bn share buyback scheme, which is set to be complete by the end of 2011. Still, its net debt to EBITDA ratio is expected to be 1.8 at the end of 2011; considered low by industry standards.
The firm today reiterated its full-year guidance. Excluding currency changes, net sales for 2011 will grow by mid-single digits, with operating profits expected to increase at either the same rate or slightly quicker. Cost rises, however, are taking their toll in the third and fourth quarters, with operating margins expected to show "modest declines" in these periods, CCE said.
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