European Coke bottler sees signs of recovery after first-half profits slide
Soft drinks bottler Coca Cola HBC AG (CCH.L) on Wednesday posted a drop in first-half profit due to coronavirus-led closures of restaurants, cinemas and other public places, while saying sales had recovered some momentum from April lows as lockdowns eased.
The company, which bottles and sells Coca-Cola Co (KO.N) drinks in 28 countries, said comparable operating profit fell 35.8% to 208.8 million euros ($246.49 million) for the six months ended June 26, beating company-supplied consensus of 191.7 million euros.
HBC said out-of-home volumes – which include sales at hotels, restaurants and cafes – during the initial weeks of lockdowns fell by 70%-90% but improved to declines of 25%-50% in May and June and 10%-40% in July.
The company’s out-of-home channel typically accounts for slightly over 40% of its revenue.
The Zug, Switzerland-based company said its retail sales improved since April, when performance was hit by some customer de-stocking.
HBC said it expects a negative impact for 2020 due to weaker consumer environment and tourist season, as well as the risk of a second coronavirus wave.
U.S.-based Coca-Cola Co owns a 23.2% stake in Coca-Cola HBC, according to Refinitiv data.