Coca-Cola FEMSA saw profits inch up over 2% last year as raw material costs and growing competition weighed on earnings.

The company, the largest Coca-Cola bottler in Latin America, has posted a 2.6% rise in operating profit to MXN9.4bn (US$849.9m) in 2006.

Coca-Cola FEMSA, the world's number two Coca-Cola bottler in terms of volumes, reported stronger revenue growth, with sales up 6.9% to MXN57.7bn.

CEO Carlos Salázar Lomelín said on Friday (23 February) that the bottler had achieved "strong top-line results" despite growing competition. He said: "Thanks to the widespread popularity of brand Coca-Cola and our well-designed commercial strategies, we also were able to produce solid bottom-line growth in spite of cost pressures in the majority of our markets."

Revenues in the fourth quarter of the year rose 7.1% to MXN15.2bn thanks to growing sales in each of the company's markets except Mexico, where sales fell 0.5% during the last three months of 2006 as Coca-Cola FEMSA saw the majority of its volume growth come from low-margin jug water.

Profits during the last quarter of 2006 inched up 0.3% to MXN2.6bn with "double-digit" growth in markets including Colombia and Argentina offsetting falling earnings in Mexico and Argentina.