Insight - Eastern Europe "troubles" Coca-Cola Co
The Coca-Cola Co has highlighted Eastern Europe as a “troubled” region for its soft drinks volumes over the last year.
Speaking at the soft drink company’s earnings conference today (9 February), group CEO and chairman Muhtar Kent said the firm has seen some “good results” in the business in Western Europe for 2009.
In Eurasia and Africa volumes rose 4% for the year, in Latin America volumes increased 6%, while case volumes in North America dropped 2% and in Europe dropped 1%.
“France was one of the top ten contributors of volume overall in 2009 for the full-year so I’m very pleased with results in growth rates in France and Italy, in Germany and in UK in the fourth quarter,” Kent told analysts.
But, he added: “I think Eastern Europe is much more troubled than Western Europe. It’s an anomaly to refer to it in that respect but it is.”
Kent said that Romania, Bulgaria, countries making up the former Yugoslavia, Russia and Ukraine were particularly “troubled” in terms of where the consumer mindset is.
“But I think overall our marketing, our brand strength our investments, our alignment with both Coca-Cola Enterprises and Coca-Cola Hellenic has proven results in some of those markets,” he told analysts.
In Western Europe, Kent said the firm will continue to “invest heavily” in its brands as it continues to see opportunities for growth.
For the 2009 fiscal year, Coca-Cola saw revenues drop 3% to $30.99bn, while net income increased 18% to reach $6.82bn.
Despite a 2% drop in volumes in North America, Kent said the performance was a “sequential improvement” relative to the first nine months of the year.
“In North America, we made critical investment in our brand and provided greater consumer choice by developing innovating packaging and industry leading labelling practices. Our new sleek mini cans have made portion control easy and are great examples of how we provide consumers with affordable value while providing shareholders with profitable growth.”
He added: “Our North America system is operating from a position of increasing strength.
“2009 was a solid year for us, despite the challenging environment,” Kent insisted. “But with consumers challenged, there might be some bumps along the way with some quarter to quarter volatility as we work our way through 2010. We maintain focused on growing our share.”
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