US: Coca-Cola Enterprises bemoans France as FY struggles

• Full-year net profits drop by 9.6% to US$677m
• Net sales in 2012 slip by 2.7% to $8.06bn
• Operating profits also down, by 10.2% to $928m
• French tax rise on added-sugar soft drinks hampers performance

Coca-Cola Enterprises (CCE) has blamed the introduction of a tax rise on soft drinks in France for hampering its 2012 numbers.

The company said today (6 February) that net profits in 2012 came in 9.6% down on 2011, at US$677m. Net sales also slipped, by 2.7% to $8.06bn, with operating profits falling by 10.2% to $928m.

Excluding the impact of the French tax rise - which came into effect in January last year - and on a currency neutral basis, net sales for the year climbed by 1%, CCE said.

Overall volumes dropped by 3% with sparkling beverages down by 3.5%, enough to cancel out a 15% volumes rise in energy drinks and 6.5% increase in Coca-Cola Zero volumes. 

In the final quarter of 2012, net profits decreased by 11.5% to $100m, as sales inched up by 1.2% to $1.92bn. Operating profits fell markedly, however, by 16.7% to $150m and overall volumes took a 5.5% drop.

“We remain confident in our ability to restore, over time, our sales and operating income growth to levels in line with our long-term targets,” said company CEO John Brock, adding that last year CCE faced “significant marketplace challenges and the ongoing macroeconomic softness”.

The results are in contrast to 2011's numbers, when net profits jumped by 20% and net sales rose by 23%.

Company officials said they expect to return to volume growth this year. 

“Going forward, we will continue to focus on value-creating opportunities in order to achieve sustained growth,” Brock said. 

CCE's share price has enjoyed a strong increase recently, climbing by about 17% since November.

For CCE's official announcement, click here.

To read just-drinks' coverage of CCE's Q3 and YTD figures, click here.