US: Tough Q3 sees Coca-Cola Enterprises target function "restructure"
- YTD net profits slide by 9.3% to US$577m
- Net sales in nine months to end of September dip by 3.8% to $6.15bn
- Operating profits fall by 8.8% to $778m
- FY net sales, operating profits both forecast to rise in low- to mid-single digit range
Coca-Cola Enterprises has seen its Q3 figures struggle, despite the London Olympics
Coca-Cola Enterprises has seen its Q2 demons return in the third quarter, with sales and profits for the year so far staying in the red.
The firm, which produced a poor set of numbers for its second quarter in July, said earlier today (25 October) that net profits in the nine months to the end of September fell by 9.3% year-on-year to US$577m. Net sales in the period were down by 3.8% to $6.15bn, as operating profits decreased by 8.8% to $778m.
In the third quarter of 2012, net profits came in 7.4% down on the corresponding period a year earlier at $263m, on the back of a 3.3% dip in net sales, which totalled $2.07bn. Operating profits in the three-month period were down by 7.3% at $306m.
CCE highlighted "the challenges of ongoing macroeconomic weakness" as playing a part in its third quarter. "Despite difficult operating conditions, we believe the third quarter was an important success as CCE employees responded ... to the significant opportunities and demands of the 2012 London Olympic and Paralympic Games," said Hubert Patricot, executive VP and president of CCE's European group.
"We will build on the long-term benefits of our involvement with the Games while working diligently to enhance efficiency and maximise effectiveness."
Looking to its full-year performance, the firm said that it now expects its net sales and operating profits growth to come in in the low- to mid-single digit range.
CCE used the results announcement to launch a "business transformation programme", which it expects will include restructuring charges of around $200m by the end of 2014.
"This programme, which is subject to consultations with workers' councils, includes initiatives to restructure portions of our finance back-office functions and new initiatives to restructure portions of our go-to-market model," CCE added.
The company hopes the move will result in around $100m "in ongoing benefits" by 2015.
Separately, CCE said late yesterday that it will pay a regular quarterly dividend of $0.16 per common share on 6 December to shareowners of record on 23 November.
UK trade body the Association of Licensed Multiple Retailers (ALMR) has appointed a new chief executive....
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