Difficult economic conditions in the first quarter of the year were not enough to dampen the spirits of the Coca-Cola Hellenic Bottling Company, the Greek soft drink bottler.
Although sales were down 5 per cent to €800 million during the quarter, mainly due to the weakening of local currencies in markets such as Nigeria, Poland, Russia, Ukraine and Belarus, the company reported a rise in volume sales during the same period.
Volumes were up 1 per cent overall to 269.7 million cases, with an 8 per cent increase in what the group calls its emerging markets more than offsetting 3 per cent declines in volumes from established and developing markets. Revenue per case is lower in these emerging markets, however.
But the company said that its pricing strategy, cost management and programme of product launches had enabled it to overcome the various short term factors which influenced sales and increase its profits despite the difficult conditions.
Operating profits were more than 100 per cent higher than losses of €7 million in 2002 at €1.9 million, while EBITDA was up 10 per cent on the previous year at €95.3 million. At the net level, losses were reduced from €38.7 million to €26.3 million, an improvement of 32 per cent.
Irial Finan, managing director of Coca-Cola HBC, commented: "We have delivered a solid financial performance despite facing significant challenges during the first quarter, exacerbated by a weak global macro-economic environment, severe winter weather conditions and a negative impact from the shift of the timing of the Easter holiday in most of our territories.
"To deliver on our long-term financial model we have focused on executing our strategy of revenue, cost and capital management and superior execution in the marketplace."
Finan said that he expected volumes to improve throughout the rest of the year as a result of a number of new product launches during the first quarter such as Vanilla Coke and a number of Fanta line extensions. The company's non-carbonate product offering was enhanced by the launch of juice flavour extensions, a new energy drink in Ireland and the continuous rollout of Nestea and Powerade while the new bottled water units - Valser in Switzerland and Dorna in Romania - contributed 2 per cent to volumes in the first quarter.
"Despite the continued challenging macro-economic environment, our performance thus far in the second quarter is improving," Finan concluded. "As we approach the important summer selling season, we expect that we will meet our previously communicated 2003 performance goals."