Coca-Cola HBC lifts full-year targets after first-half improvement
Coca-Cola HBC AG on Wednesday raised it full-year guidance on the back of profit growth in the first half driven by volume, and reported progress on its African acquisition.
The Steinhausen, Switzerland-based soft drinks bottler operates in markets such as Austria, Cyprus, Greece, Italy, Ireland and Switzerland. Its shares traded 3.7% higher at 5,005.00 pence each on Wednesday morning in London, having risen 28% over the past year.
Coca-Cola HBC booked pretax profit of EUR723.3 million for the six months ended June 30, up 12% from EUR644.6 million a year before.
Net profit rose 11% to EUR524.4 million from EUR470.6 million, while comparable earnings before interest and tax increased 17% to EUR760.1 million from EUR649.8 million, for a margin of 12.0%, up from 11.5%.
Net sales revenue grew 11% to EUR6.23 billion from EUR5.62 billion, and advanced by 9.6% on an organic basis.
First-half volume increased to 1.57 billion unit cases, up 7.5%, on both a reported and organic basis, from 1.46 billion on-year.
The company raised its full-year organic revenue target to the top end of its prior 6% to 7% target growth range, and guided annual organic Ebit growth of 8% to 10%, the bottom of the range raised a notch from 7% previously.
"We have delivered a strong first half. We monitor the macroeconomic and geopolitical backdrop closely and expect it to remain challenging and unpredictable. That said, we remain confident in our 24/7 portfolio, our bespoke capabilities, our people, and the opportunities for growth in our diverse markets," Coca-Cola HBC said on Wednesday.
Reflecting on first-half trading, Coca-Cola HBC Chief Executive Zoran Bogdanovic pointed out that "successful FIFA World Cup activations with our customers, including unique fan experiences and special-edition Coca-Cola and Powerade packs were among the highlights of the period".
The CEO added: ""Given our strong first half, we are upgrading our 2026 guidance today. The macroeconomic and geopolitical environment remains challenging and unpredictable, but we are confident that our portfolio, capabilities and people position us to continue to win in the market and create value."
Coca-Cola HBC also noted that it is on track to complete the acquisition of Coca-Cola Beverages Africa in the second half, with clearance from antitrust regulators secured in four out of six jurisdictions so far. In July, the South African Competition Commission recommended approval of the transaction, with conditions.
Back in October, Coca-Cola HBC disclosed plans to buy a 75% shareholding in Coca-Cola Beverages Africa Pty Ltd from brand owner Coca-Cola Co and Gutsche Family Investments Pty Ltd for USD2.6 billion.
The acquisition is being funded through a new USD2.5 billion bridge financing facility and the issue of Coca-Cola HBC shares to GFI, representing around 5.5% of Coca-Cola HBC share capital.
In addition, Coca-Cola HBC has an option to buy the remaining 25% equity interest in CCBA owned by Coca Cola following completion.
The deal creates the second largest Coca-Cola bottling partner by volume globally, with leading market positions across Africa and Europe. Mexico City-based Coca-Cola FEMSA, which operates across Latin America, claims to be the largest Coca-Cola franchise bottler in the world by sales volume.
Coca Cola HBC, which already operates in Nigeria and Egypt, said the enlarged business will, on completion, cover more than 50% of the continent's population.
When it announced the deal, Coca-Cola HBC cancelled its buyback programme. It also noted plans for a secondary listing on the Johannesburg Stock Exchange.
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