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Coca-Cola Amatil forecasts 4-5pc profit growth

Nicholas Grove  |  12 Dec 2012Text size  Decrease  Increase  |  

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Nicholas Grove is a Morningstar journalist.


Coca-Cola Amatil (CCL) on Wednesday said it expects to record growth in profit before one-off items of 4 to 5 per cent in the 2012 calendar year, after the Coke bottler recorded a profit of $531.1 million in the previous year.

"Coca-Cola Amatil has continued to outperform its peer group and in 2012 we expect to again deliver increased group revenue and volume growth," managing director Terry Davis said.

"Indonesia and PNG (Papua New Guinea) will once again deliver a strong performance, and while the trading environment in Australia remains challenging, we have seen some improved momentum in the lead up to Christmas."

However, Davis also said trading conditions have not improved for the New Zealand and SPC Ardmona operations and that these businesses will negatively impact overall group earnings growth by approximately 2 per cent for 2012.

For 2012, the company said it expects capital expenditure to be in the range of $450 million to $460 million, with net debt as at 31 December 2012 to be in line with 2011.

In a statement, Davis also said the company had acquired San Miguel's non-alcoholic beverage bottling assets in Jakarta, following the Philippine brewer's decision to exit the production of non-alcoholic beverages in Jakarta.

Commissioned in 2006, the assets include a 20,000-square-metre purpose-built beverage production facility, which includes a high speed PET bottling line and a 5000-square-metre warehouse.

"The acquisition of this large and modern facility is a very important acquisition for Coca-Cola Amatil as it fast tracks our expansion plans for the Jakarta region, providing a well-located complement to our Cibitung manufacturing operations," Davis said.

The company said it expects to spend approximately $45 million on the acquisition of the existing San Miguel facilities and on expenditure to further develop site capacity over the next 12 months.

Coca-Cola Amatil said it is also currently completing the acquisition of an existing 18,000-square-metre warehousing facility in PNG for $28 million.

It also said it has entered a long-term agreement to distribute Sweden's Rekorderlig cider in Australia from 1 January 2014.