Coca-Cola Enterprises, Inc. (CCE) which engages in marketing,
production, and distribution of non alcoholic beverages has warned that a
“difficult operating environment” will hamper both its 2015 and 2016
full-year performances.
The company, which in October reported a 15% fall in net sales for
the first nine months of 2015, said late yesterday that net sales in the
12 months of this calendar year will be “slightly negative”. While net
sales in 2016 are forecast to be up slightly for the full-year, Q1 will
have to deal with transaction costs related to CCE’s tie-up with the
German unit of the Coca-Cola Co and Coca-Cola Iberian Partners to form
Coca-Cola European Partners.
The new bottling entity, announced in August, will generate costs for
CCE of between $25m and $30m in 2015, and between $75m to $100m in
2016. The company noted that it does not plan to repurchase any shares
next year, due to the pending transaction.
CEO John Brock said: “While we anticipated managing through a
difficult operating environment in 2015, the consumer sector and the
category have been softer than originally expected. Further, we expect
these conditions to continue to impact CCE’s results into 2016.
“While the creation of Coca-Cola European Partners will provide new
synergies and efficiencies, top-line growth is expected to remain
challenging in 2016,” Brock added.
On the bottom line, 2015 should see operating profits generate
“slightly positive growth”, although they are expected to come in down
slightly in the first quarter of next year.
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