Coca-Cola Amatil is celebrating another year of double-digit EBIT growth for Alcohol & Coffee in 2018, bucking the continuing impact of container deposit schemes on the company.
Alcohol achieved volume growth, high single-digit revenue growth and another year of double digit EBIT growth for the year. Spirits and premix grew ahead of market. Paradise Beverages continued to grow sales. Coffee grew revenue and volume for the year with positive drivers including coffee bean products and sales in grocery. EBIT performance reflected investment in international opportunities including in Indonesia. A new high value premium brand, SoCo Coffee Roasters, was also launched during the year.
Revenue for Alcohol & Coffee was up 8% to $609.8million in 2018, with underlying EBIT at $55.7million, up 12.1%.
Coca-Cola Amatil said the result was driven by strong performance in the spirits and premix segment, driven by Canadian Club, Maker's Mark and Roku Gin.
Group Managing Director Alison Watkins noted: "Alcohol & Coffee achieved another year of double-digit EBIT growth while also funding investment in initiatives for our growth aspirations."
Coca-Cola Amatil group earnings impacted
Coca-Cola Amatil's full-year results for 2018 delivered underlying earnings before interest and tax (EBIT) from continuing operations of $634.5 million and underlying net profit after tax (NPAT) from continuing operations of $388.3 million.
The 37.3% slump in full-year net profit was driven by $150 million in impairments due to the soon-to-be-sold SPC business, a loss of in earnings in the soft drinks arm and worsening trading from its Indonesian drinks operations.
Watkins said 2018 was a transition year for the group with earnings impacted by planned investment in the Accelerated Australian Growth Plan, the introduction of container deposit schemes, economic factors in Indonesia and operational challenges in PNG.
“We saw a strong year for the New Zealand, Fiji and Alcohol & Coffee businesses, while there are also positive signs for Australian Beverages with volume growth in Coca-Cola Trademark beverages in the second half.
“Despite the segment result there are also encouraging signs in Indonesia with volume growth over the last nine months of the year. However, as previously reported the Indonesian result was affected by soft market conditions, a weak currency and higher commodity prices. The business is strongly leveraged to capture future growth.”
Australian Beverages sees volume increases
Australian Beverages’ volume share increased for the year, in both sparkling and still beverages.
Watkins said there was volume growth for Coca-Cola Trademark in the second half led by the continued success of Coca-Cola No Sugar. Low- and no-sugar cola achieved low-single digit volume growth for the year, accelerating in the second half. There was also strong volume growth in dairy and energy throughout the year.
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