US: Coca-Cola Enterprises warns of tough outlook
Coca-Cola Enterprises is expecting a mid to high single-digit drop in its comparable second quarter earnings per share as a result of the weak American economy.
Weakening economic trends have continued to limit volume performance in North America, particularly in higher margin 20-ounce packages of sparkling beverages and water, negatively affecting operating income, the company warned in a statement.
In Europe, CCE expects modest volume and operating income growth in the second quarter despite the impact of a recently resolved two-week labour disruption in France.
Given these factors, CCE now expects a mid to high single-digit decline in second quarter comparable earnings per share versus the second quarter of 2007.
"We are taking action to meet the persistent challenges created by these weakening economic and marketplace conditions in the US, including initiatives to strengthen cold drink sales, increase revenue, and reduce expenses," said John Brock, chairman and CEO. "We are entering the key summer selling season, and the net impact of these initiatives against the background of the uncertainties in the marketplace remains unclear."
CCE is expecting to deliver a full-year 2008 earnings guidance of $1.50 to $1.55 earnings per share. However, Brock said this will be challenging if current economic and market trends do not improve.
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