Coca-Cola Q3 sales drop but on track for full year

Coca-Cola HBC posted a drop in third-quarter sales volumes on the back of unfavourable weather compared to the same period last year but said it was on track to meet expectations for the year.

In the three months to the end of September, volumes declined 1% as the company expected against “very tough comparatives” in the prior-year quarter, when the exceptionally hot summer in some of its countries boosted demand, mainly for water. In the third quarter of 2015, group volumes had risen 5.4%.

Total revenue was down 1.9% in the quarter, with net sales revenue per unit case down 0.7%.

Chief executive officer Dimitris Lois said: “Performance in the third quarter was as expected, with lower volume reflecting the exceptional growth we saw in the third quarter of 2015. We are pleased with our commercial initiatives, which delivered an improvement in currency-neutral net sales revenue per case. The business is trading well and we remain confident in meeting our expectations for the full year."

Volumes in established markets fell 2.5% in the quarter compared to a 7.4% jump in the same period a year ago, driven by water in Italy and Austria and tough comparatives due to a hot summer in 2015. A good performance from Coke Zero and Energy along with successful Coke Life launches in Austria and Italy partly offset declines led by water, the company said. Net sales revenue in established markets declined by 3.6% in the quarter.

In developing markets, volume was down 4.2% compared to a 10.4% increase in the third quarter a year ago, with the majority of the countries in the segment seeing declines due to tough prior-year comparatives driven by demand for water. Net sales revenue in the developing markets dropped by 2.3% in the quarter.

In emerging markets, volume growth improved to 1.3% in the period following a stable performance in the first half of the year, with Nigeria and Romania continuing to grow, while the rates of decline in Russia moderated.