# Coca-Cola HBC AG additional momentum and share gains in Q2 - Link: https://www.directorstalkinterviews.com/coca-cola-hbc-ag-additional-momentum-and-share-gains-in-q2/4121016497 - Published: 2021-08-12T07:43:38+01:00 - Author: Amilia Stone **Coca-Cola HBC AG** (LON:CCH), a growth-focused Consumer Packaged Goods business and strategic bottling partner of The Coca-Cola Company, has reported its financial results for the six months ended 2 July 2021. **Half-year highlights** ·   Ongoing recovery and effective execution drove additional momentum and share gains in Q2, with H1 FX-neutral revenue growth +23.1% like-for-like^(1). Reported revenues +14.7% o  FX-neutral net sales revenue closed 4% above 2019 levels (like-for-like) o  Value share gains increased, + 50bps in NARTD ·   Volume growth of 15.9% like-for-like; sustained performance in the at-home channel complemented by recovery in out-of-home during Q2 ·   Improvements in FX-neutral revenue per case, benefited from pricing taken in over 90% of our markets and positive category, package and channel mix ·   Prioritisation of opportunities and innovation within our 24/7 portfolio is building momentum o  Sparkling volume +16.2%, with Adult sparkling +37.0% and Low/no sugar +40.3% o  Energy volume + 66.1%, driven by the performance of Monster, Burn and Predator ·   Costa Coffee roll-out continues to progress well; Coffee strategy strengthened with premium Italian brand, Caffè Vergnano, to start distribution by 2022 ·   Operating leverage and cost savings resulted in comparable EBIT margin up 340 bps to 10.8% o  €120 million of COVID-related opex savings were achieved in 2020. We continue to expect to retain c. €20 million of this in 2021 and therefore €100 million of these costs to return in H2 2021. **Segment highlights** Rebound in Established and Developing segments adding to continued strong results in Emerging ·   **Established:** FX-neutral revenue increased by 17.1% as markets reopened, driving comparable EBIT margins up 440bps ·   **Developing:** FX-neutral revenue up 17.6%, with stable volume performance despite impact from Polish sugar tax; comparable EBIT margins up 180bps ·   **Emerging: **FX-neutral revenue up 30.3% like-for-like; continued strong performance from Russia and Nigeria and recovery through the rest of the segment led to comparable EBIT margins increasing by 340bps | | Half-Year 2021 | Half-Year2020 | Change | | **Volume****^(1) (m unit cases)** | 1,126.7 | 990.5 | 13.8% | | **Net sales revenue****^(1) (€ m)** | 3,247.9 | 2,831.2 | 14.7% | | **Net sales revenue per unit case****^(1) (€)** | 2.88 | 2.86 | 0.9% | | **FX-neutral net sales revenue****^(1,2) (€m)** | 3,247.9 | 2,687.7 | 20.8% | | **FX-neutral net sales revenue per unit case****^(1,2) (€)** | 2.88 | 2.71 | 6.2% | | Operating expenses/ Net sales revenue (%) | 26.6 | 30.1 | -350bps | | Comparable operating expenses / Net sales revenue (%) | 26.2 | 30.0 | -380bps | | **Operating profit (EBIT)****^(1,3) (€ m)** | 350.1 | 202.9 | 72.5% | | **Comparable EBIT****^(1,2) (€ m)** | 350.3 | 208.8 | 67.8% | | EBIT margin (%) | 10.8 | 7.2 | 360bps | | **Comparable EBIT margin****^(2) (%)** | 10.8 | 7.4 | 340bps | | **Net profit****^(4) (€ m)** | 233.1 | 124.0 | 88.0% | | **Comparable net profit****^(2,4) (€ m)** | 235.6 | 129.0 | 82.6% | | Basic earnings per share (EPS) (€) | 0.639 | 0.341 | 87.4% | | **Comparable EPS****^(2) (€)** | 0.646 | 0.355 | 82.0% | | **Free cash flow****^(2) (€ m)** | 277.5 | (38.5) | NM | _^(1)__ Performance, unless stated otherwise, is negatively impacted by the change in classification of our Russian Juice business, Multon, from a joint operation to a joint venture, following its re-organisation in May 2020. For the Group’s growth including the respective performance of Multon as a joint operation in the current period, refer to the relevant table in the ‘Supporting information’ section._ _^(2)__For details on APMs refer to ‘Alternative Performance Measures’ and ‘Definitions and reconciliations of APMs’ sections._ _^(3 )__Refer to the condensed consolidated interim income statement._ _^(4)__Net Profit and comparable net profit refer to net profit and comparable net profit respectively after tax attributable to owners of the parent._ > **Zoran Bogdanovic, Chief Executive Officer of Coca-Cola HBC AG, commented:** > “We are very pleased with the first half in which we increased value share gains, > revenues and profitability as well as making continued progress on our strategic > priorities. > I believe these results demonstrate the power of our 24/7 portfolio, our revenue > growth management actions, the strength of our execution capabilities and the > talent of our people whose resilience and adaptability will underpin our future > opportunities. > The business gained momentum as the out-of-home channel recovered and growth in > at-home continued. In addition, we have delivered growth in the Established and > Developing segments alongside the consistent strong performance in the Emerging > segment. > We are seeing excellent performance from our areas of strategic focus – in particular > Low- and no-sugar sparkling, Adult sparkling and Energy. We have strengthened > our Coffee strategy with Caffè Vergnano, which will add a premium offering alongside > the broad appeal of Costa Coffee. We have made progress on our World Without Waste > agenda with new launches of 100% recycled PET packaged beverages. > We are encouraged by the strength of the performance, and while conscious of the > risks as the COVID-19 pandemic continues to impact our markets, we continue to > expect a strong recovery in FX-neutral revenues and now believe that we can achieve > a 20-30bps EBIT margin expansion this year.” Share on: