US: Coca-Cola Enterprises falls to FY loss

One-off charges have led Coca-Cola Enterprises to report a net loss of US$4.4bn for 2008, despite a 4% increase in net revenue for the year.

A $7.6bn non-cash charge was the main reason for the full-year loss, Coca-Cola Enterprises (CCE) said today (11 February). It reported a profit of $711m in 2007.

Fourth quarter net loss for the soft drinks bottler was $1.45bn, compared to a profit of $158m last year, following a $2.3bn impairment charge incurred during the three months.

The group said the fourth quarter charge reflected a revaluation of assets in North America "in light of financial market conditions and CCE's stock price". The group's share price closed at $11.95 yesterday, compared to a 52-week high of $25.46.

CCE revenue rose by 4% to $21.8bn for 2008, although slipped by 1% in the fourth quarter.

"Our fourth quarter results reflect slight improvement in our North American business trends and continued solid operating performance in Europe," said John Brock, CCE chairman and CEO. "However, we continue to face economic pressures in all territories."

North America volumes fell by 7% in the fourth quarter, and by 1.5% for the year, but the group benefitted from a 9.5% price rise during the final three months.

In Europe, full-year volumes grew by 3%, led by 4% growth in the UK, with carbonated beverages rising 2% and still beverages up 8.5% across the region. Fourth quarter volumes increased by 1.5% in Europe.

In its outlook, CCE said that it expected low and mid single-digit rises operating income and earnings per share respectively.

Group revenue is expected to rise in mid single-digits, but volumes will decline in North America "eflecting the impact of essential pricing actions to offset an expected high single-digit increase in cost of goods per case", the bottler said.

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