US: "Soft" North America hits CCE in first quarter
Coca-Cola Enterprises has seen "soft economic conditions" in North America hamper its first quarter performance.
The marketer, distributor and producer of Coca-Cola Co. brands said today (24 April) that operating income in the first three months of 2008 slipped by 10.5% to US$163m, despite a 7% increase in net sales to $4.89bn. Net income slumped to $8m from $15m, although stripping out items which affect comparability, including restructuring charges, would see net income hit $38m.
The company blamed softer than expected volume in North American single-serve packages, particularly in sparkling beverages and Dasani for the quarter's performance. At the same time, continued European operating improvement, and the benefits of restructuring programmes and operating expense initiatives, were credited with bringing balance to proceedings.
"While weakness in North America's economic environment tempered our first quarter results, we remain focused on executing against our three strategic objectives, ensuring the continued success of our restructuring programs, and controlling our operating expenses," said company chairman and CEO, John Brock.
"We believe positive topline trends in Europe, coupled with the improvement generated by North American operating and brand initiatives, will enable us to achieve solid earnings growth," Brock continued. "As we work to achieve this target, it is important that we respond to the marketplace challenges created by the current North American economic environment. We are working quickly and aggressively with The Coca-Cola Company on specific strategies that will strengthen our ability to deliver against our objectives."
For the full year, CCE said it expects earnings per share to come in between $1.50 and $1.55.
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