Coca-Cola Enterprises (CCE) has reaffirmed its 2005 outlook, but has warned that 2006 will be flat against this year's results.

The bottler said today (15 December) that 2005 earnings will come in at the expected range of US$1.27 to US$1.30 excluding certain items, with North America expected to generate volume growth of approximately 1% and pricing growth of about 3%. Europe, however, is expected to dip by 2% in volume, with pricing growth of around 2%.

"We have made significant progress in North America this year in building a business that will continue to generate sustained, balanced volume and pricing growth," said Lowry F. Kline, chairman of the board. "In a year characterised by significant cost increases, we have remained focused on this objective while successfully managing our operating expenses, generating significant pricing improvement and delivering full-year volume growth.

"Although Europe's 2005 volume performance is below target, we have worked to preserve our financial results through tight cost controls and disciplined revenue management," Kline continued. "For 2006, we have plans in place that build on our success in North America and work to address the marketplace challenges we face in Europe. We believe North America's continued growth, coupled with modest improvement in Europe, will lead to improved financial performance in 2006."

In 2006, North American volume is expected to grow by between 1% to 2%, with prices being increased by between 2% and 3%. Europe is projected to achieve volume growth of between 1% and 2%. The company also plans to increase pricing in the continent of around 2%. Overall, earnings are projected to come in between US$1.27 and US$1.32 for the year.

"Our business plans for 2006 enable us to be optimistic about improved performance, particularly in North America, where we expect a continued balance of volume and pricing growth throughout our territories," said Bill Douglas, CCE's CFO. "In 2006, we believe we will benefit from more moderate cost of goods increases next year, another aggressive calendar of solid brand and package innovation and operating improvements that will strengthen our ability to focus on our customers and the marketplace."

Separately, the company's board of directors has approved a 50% increase in annual dividend to 24 cents per share beginning in 2006.

CCE plans to report full-year 2005 earnings in early February.