Coca Cola Amatil expects profit growth

AAP
December 12, 2012

Amatil (CCA) says trading conditions in Australia have picked up in the lead-up to Christmas as the beverage group forecasts a lift in profit and revenue for 2012.

The company also said it had signed a deal to distribute alcoholic cider in Australia from 2014.

CCA said on Wednesday it expected net profit before significant items for the 12 months to December 31, 2012, to rise between four and five per cent from $532 million in the prior corresponding period.

CCA managing director Terry Davis said CCA had gained market share in Australia over the year and had made a solid start to the Christmas season.

However, Mr Davis said the Australian market was still tough, with consumer spending levels “soft” and “price-driven competitor activity” during the second half restraining volume growth.
“While the trading environment in Australia remains challenging, we have seen some improved momentum in the lead-up to Christmas,” Mr Davis said in a statement.

“While we still have an important two weeks of trading ahead of us, at this stage we expect to deliver positive volume and revenue growth for the second half.”

Mr Davis said Indonesia and Papua New Guinea would deliver a strong performance, but trading conditions for CCA’s New Zealand and SPC Ardmona operations had not improved and would be a drag on earnings.

Meanwhile, CCA said it had signed a long-term exclusive agreement to distribute Rekorderlig cider, produced in Sweden, in Australia from January 1, 2014.

Under the terms of the sale of CCA’s previous beer business to SABMiller, CCA was restrained from selling, distributing or manufacturing beer in Australia until December 16, 2013, but can distribute beer in other markets.

In other news, CCA said it had bought the Jakarta non-alcoholic beverage bottling assets of PT San Miguel Indonesia Food and Beverages.

The acquisition, as well as costs to develop the site over the next 12 months, would be $45 million, CCA said.

Also, the company said it was completing the acquisition of a warehousing facility in Papua New Guinea for $28 million.

At 1106 AEDT, CCA was down 28 cents, or 2.01 per cent, at $13.64.