Strong execution powers a year of growth
Full-year highlights
· Focused execution of 24/7 strategy delivered 16.9% organic revenue growth1
o Organic volume growth of 1.7% led by our strategic priority categories, with Sparkling +2.5%, Energy +27.3% and Coffee +31.5%
o Strong finish to the year with 6.8% organic volume growth in Q4 and improving trends in all three reporting segments
o Organic revenue per case growth of 15.0%, reflecting the benefits of revenue growth management initiatives throughout the year
o Reported revenue up 10.7%, with strong organic growth partly offset by FX translation headwinds in Emerging markets
o Continued value share gains in 2023 in both Non-Alcoholic Ready-To-Drink (NARTD) and Sparkling of 110bps and 80bps respectively
· Strong organic EBIT growth of 17.7% driving good improvement in Return on Invested Capital
o Comparable EBIT of €1,083.8 million; Comparable EBIT margins improved 50 basis points on a reported basis to 10.6%, up 10 basis points on an organic basis
o Comparable gross profit margin up 80 basis points, reflecting easing cost pressures in the second half of the year
o Disciplined investment in growth capabilities and good operating leverage reduced comparable operating expenses as a percent of revenue by 10 basis points
o ROIC up 230 basis points to 16.4%
· Double-digit organic revenue and EBIT growth across all segments
o Established: Organic revenue up 12.3%, led by pricing and mix. Organic EBIT grew 23.0%
o Developing: Organic revenue up 18.2%, with strong revenue per case expansion. Organic EBIT grew 26.9%
o Emerging: Organic revenue up 19.9%, with volume growth as well as revenue per case improvement. Organic EBIT grew by 11.7%
· Strong EPS progress, record FCF generation and improved shareholder returns
o Comparable EPS grew by 21.8% to €2.08, supported by strong profit delivery and effective management of finance costs
o Free cash flow increased by 10.3% to a record €711.8 million
o Net debt of €1.6 billion and 1.1x net debt to comparable adjusted EBITDA, reflecting the strength of our balance sheet
o Launched a two-year share buyback programme of up to €400 million in November, reflecting the Board's long-term confidence in business performance
o Board of Directors to propose an ordinary dividend of €0.93 per share, up 19.2% year on year and representing a 45% payout
· Sustained investment across our strategic priorities
o Capital expenditure of €674.9 million, up 14.5%, focused on sustainable growth
o Acquisition of
o Accelerated investment in bespoke capabilities, particularly digital initiatives, and our agenda to further strengthen our ability to win in the market
o Launched
"I am deeply proud of our team as we delivered a third year of double-digit growth and record profits. I would like to thank them for their tireless efforts, and their commitment to our company vision, our customers and consistent focused execution. I would also like to thank our customers and partners for their ongoing support throughout the year.
"2023 was another year of consistent execution of our growth strategy. We delivered volume growth, share gains, improved margins and record levels of free cash flow. As a result, we were able to increase shareholder returns, including the launch of a share buyback programme.
"The power of our 24/7 portfolio, our diversified country footprint and our sustained investment in building bespoke capabilities, driven by data, insights and analytics, are foundations of compounding growth.
"In 2023, we made significant progress towards our Mission 2025 and NetZeroby40 goals, with key milestones including commissioning a new in-house recycled plastic (rPET) production facility in
"While we expect the macroeconomic and geopolitical environment to remain challenging, we remain confident that we will continue to make progress against our medium-term growth targets."
|
|
Full Year |
|
|
|
|
|
2023 |
2022 |
% Change Reported |
%Change Organic1 |
|
Volume (m unit cases) |
2,835.5 |
2,711.8 |
4.6% |
1.7% |
|
Net sales revenue (€ m) |
10,184.0 |
9,198.4 |
10.7% |
16.9% |
|
Net sales revenue per unit case (€) |
3.59 |
3.39 |
5.9% |
15.0% |
|
Operating profit (EBIT)2 (€ m) |
953.6 |
703.8 |
35.5% |
|
|
Comparable EBIT1 (€ m) |
1,083.8 |
929.7 |
16.6% |
17.7% |
|
EBIT margin (%) |
9.4 |
7.7 |
170bps |
|
|
Comparable EBIT margin1 (%) |
10.6 |
10.1 |
50bps |
10bps |
|
Net profit3 (€ m) |
636.5 |
415.4 |
53.2% |
|
|
Comparable net profit1,3 (€ m) |
764.2 |
624.9 |
22.3% |
|
|
Basic earnings per share (EPS) (€) |
1.730 |
1.134 |
52.6% |
|
|
Comparable EPS1 (€) |
2.078 |
1.706 |
21.8% |
|
|
Free cash flow1 (€ m) |
711.8 |
645.1 |
10.3% |
|
1For details on APMs refer to 'Alternative Performance Measures' and 'Definitions and reconciliations of APMs' sections.
2Refer to the condensed consolidated income statement.
3Net Profit and comparable net profit refer to net profit and comparable net profit respectively after tax attributable to owners of the parent.
Business Outlook
We have delivered a stronger-than-expected financial performance in 2023, despite the significant headwinds to our business. While we expect the macroeconomic and geopolitical environment to remain challenging, we have high confidence in our 24/7 portfolio and the opportunities for growth in our diverse markets, amplified by our bespoke capabilities, and above all, the talent of our people. In 2024 we expect to make progress against our medium-term growth targets.
Our guidance for 2024 is:
· Organic revenue growth at a Group level in our 6-7% medium-term target range
· On a comparable basis, COGS per unit case should increase low to mid-single digits through the combined effect of inflation, transactional and translational FX
· Organic EBIT growth in the range of +3% to +9%
Technical 2024 guidance
FX: We expect the impact of translational FX on our Group comparable EBIT to be a €30-50 million headwind.
Restructuring: We do not expect significant restructuring initiatives to take place.
Tax: We expect our comparable effective tax rate to be towards the top end of our 25% to 27% range.
Finance costs: We expect net finance costs to be between €50-70 million.
Scope: We expect the scope impact from the
Group Operational Review
Consistent execution of our 24/7 growth strategy has delivered a strong financial performance and significant strategic progress. We have invested strategically in the business, further developed our bespoke capabilities and evolved our culture, our partnerships and our portfolio. As a result, we remain very confident in the differentiated strengths of our business and our ability to sustain high levels of revenue growth into the future. This is well reflected in the progress we have made delivering our strategic pillars.
Leveraging our unique 24/7 portfolio
Full year organic revenue grew by 16.9%, with growth in volumes, price and mix. Reported net sales revenue increased by 10.7%, with adverse FX translation effects partially offsetting strong organic growth across the group.
Volumes increased by 1.7% on an organic basis, led by our strategic priority categories of Sparkling, Energy and Coffee, which offset declines in Stills, as a result of conscious choices to drive profitable growth.
· Sparkling volumes grew by 2.5%. Excluding
· Energy volumes grew by 27.3%, the eighth consecutive year of strong double-digit growth, with good results across all segments. In Established and Developing markets, growth was driven by Monster, while growth in Emerging was led by Predator, as well as the successful launch of our Energy portfolio in
· Coffee volumes grew 31.5%, with all three segments growing above 20%. We continue to make good progress on out-of-home customer recruitment, adding 5,000 outlets in the year to bring our total to 13,000. Our segmentation strategy is working well and we remain excited about the medium-term opportunity.
· Sports drinks delivered good growth, however Still volumes declined 4.4% as we consciously chose to focus on opportunities for the most profitable revenue growth in the Water category. As a result, Water volumes were 5.9% lower than the prior year, largely reflecting declines in
· Premium Spirits volumes grew by 13.1% on an organic basis, driven by all segments. The acquisition of the
Winning in the marketplace
Organic net sales revenue per case grew by 15.0% in the full year, led by 19.0% growth in the first half, due to pricing actions to mitigate cost inflation in our markets. As cost pressures eased in the second half of the year, organic net sales revenue per case grew 11.1%, largely reflecting the cycling effect of pricing actions taken in the second half of 2022.
Our revenue growth management initiatives, powered by ongoing investment in data, insights and analytics, have allowed us to take more informed pricing decisions and address both affordability and premiumisation, while still improving revenue per case. Affordability remained important in 2023, as many of our markets faced pressures on consumer disposable income. We responded by launching new smaller pack formats, as well as by driving promotional activities with a higher return on investment, and utilising the strength of our 24/7 portfolio to tailor our offer in different markets and for different customer needs.
Our actions to drive premiumisation resulted in positive category and package mix. Category mix benefitted mainly from the increased contribution of Sparkling, Adult Sparkling and Energy, as well as the lower contribution from Water. Package mix improved as we made further strategic progress, increasing single-serve mix by 80 basis points.
As a result of the commercial decisions we have made, we continued to deliver strong share gains in 2023, gaining 110 basis points of value share in NARTD and 80 basis points in Sparkling. This improved performance benefitted from our core focus of driving joint value with customers and the strength of our 24/7 brand portfolio. We were again the number one contributor to retail customers' absolute revenue growth within fast moving consumer goods (FMCG) in
Operating profit, margins and cost control
Comparable gross profit grew by 13.2%, with gross profit margins up 80 basis points to 35.0%. Comparable COGS per case increased 4.7%, mainly reflecting easing inflation in some commodities in the second half of the year, FX translational benefits from the movements in the Nigerian Naira, offset by transactional headwinds.
Comparable operating costs as a percent of revenue decreased by 10 basis points to 24.4%. We benefitted from good operational leverage while investing in growth as revenues accelerated. We increased marketing spend and added route-to-market capabilities, seizing opportunities across our markets while maintaining tight control of non-essential costs.
Comparable EBIT increased by 16.6% on a reported basis to €1,083.8 million, principally driven by organic growth across our markets, only partially offset by negative foreign currency movements. The comparable EBIT margin was 10.6%, up 50 basis points on a reported basis, benefitting from operational leverage. On an organic basis, comparable EBIT increased by 17.7%, and margins grew 10 basis points.
We saw a negative translational and transactional currency impact in 2023, driven by the depreciation of the Nigerian Naira, Russian Rouble and Egyptian Pound.
Net profit and free cash flow
Comparable net profit of €764.2 million and comparable basic earnings per share of €2.078 were 22.3% and 21.8% higher respectively. Reported net profit and reported basic earnings per share of €636.5 million and €1.730 were 53.2% and 52.6% higher respectively compared to 2022, reflecting the lower level of non-cash financial charges including impairments.
Comparable taxes amounted to €277.1 million, representing a comparable tax rate of 27%, at the top end of our guided range of 25% to 27%.
ROIC expanded by 230 basis points to 16.4%, driven by higher profit, partly offset by higher invested capital.
Net finance costs were €34.4 million lower than the prior year at €48.3 million, driven mainly by higher finance income as a result of increased interest on cash deposits and stable finance costs on fixed rate borrowings.
Net impairment losses were €16.9 million lower, reflecting a €109.4 million charge in
Capital expenditure increased by €85.4 million to €674.9 million as we continued to invest in developing our production facilities, renovating and expanding our cooler footprint, and driving other strategic opportunities that help deliver our sustainability agenda. Capex as a percentage of revenue was 6.6%, towards the low end of our targeted range of 6.5% to 7.5%, reflecting the strong level of revenue growth achieved in the year.
Free cash flow was €711.8 million, an increase of €66.7 million compared to the prior year and a record for the business, largely reflecting higher operating profit.
ESG leadership
In 2023 we made good progress on sustainability, which remains an important growth enabler.
A significant focus for us is full packaging circularity. In 2023,
We have also led on packaging innovation. In
Turning to other elements of our Mission 2025 framework, we exceeded our goal of having 50% energy-efficient coolers in the market (excluding
Innovation is critical in creating new technologies and for this reason we became a partner in the $137.7 million Greycroft Coca-Cola System Sustainability Fund, with seven other bottlers and The Coca-Cola Company. Also in 2023, we announced we are establishing a charitable foundation, with an initial donation of €10 million, dedicated to supporting local communities.
Our 2023 sustainability performance was recognised externally by leading scores from major ESG benchmarks. We were ranked, for the seventh time, as the world's most sustainable beverage company by the 2023 Dow Jones Sustainability Indices, and we were recognised in CDP's A List for leading practices in climate and water security.
4 Returnable Glass Bottle line co-funded by the
Operational Review by Reporting Segment
|
Established markets |
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|
|
|
|
Full Year |
|
|
|
|
|
2023 |
2022 |
% Change Reported |
% Change Organic |
|
Volume (m unit cases) |
628.7 |
643.9 |
-2.4% |
-2.4% |
|
Net sales revenue (€ m) |
3,358.5 |
2,974.1 |
12.9% |
12.3% |
|
Net sales revenue per unit case (€) |
5.34 |
4.62 |
15.7% |
15.1% |
|
Operating profit (EBIT) (€ m) |
379.2 |
310.4 |
22.2% |
|
|
Comparable EBIT (€ m) |
381.1 |
307.1 |
24.1% |
23.0% |
|
EBIT margin (%) |
11.3 |
10.4 |
90bps |
|
|
Comparable EBIT margin (%) |
11.3 |
10.3 |
100bps |
100bps |
Net sales revenue grew by 12.3% and 12.9% on an organic and reported basis respectively, as we experienced positive foreign currency movements from the Swiss Franc.
Organic growth in net sales revenue per case was 15.1%, driven by price increases, weighted to the first half, as well as positive category and package mix. A focus on single-serve activation drove a 3.2 percentage point improvement in single-serve mix.
Established markets volume declined by 2.4%, on strong comparatives, with an improving trend towards the end of the year. Sparkling volumes fell slightly, despite growth in Coke Zero and Adult Sparkling. Energy volumes expanded by mid-teens despite tough comparatives, with good growth in Monster. Stills volumes declined by high-single digits, driven by a low-double digit decline in the Water category, as we made conscious choices to prioritise profitable revenue growth.
· Volumes in
· In
· In
· In
Comparable EBIT in the Established segment increased by 23.0% and 24.1% on an organic and reported basis respectively, to €381.1 million. Comparable EBIT margin was 11.3%, up 100 basis points on an organic basis, as operational leverage and cost control more than offset COGS inflation.
|
Developing markets |
|
|
|
|
|
|
Full Year |
|
|
|
|
|
2023 |
2022 |
% Change Reported |
% Change Organic |
|
Volume (m unit cases) |
471.0 |
478.8 |
-1.6% |
-1.7% |
|
Net sales revenue (€ m) |
2,088.6 |
1,719.7 |
21.5% |
18.2% |
|
Net sales revenue per unit case (€) |
4.43 |
3.59 |
23.5% |
20.2% |
|
Operating profit (EBIT) (€ m) |
152.6 |
113.1 |
34.9% |
|
|
Comparable EBIT (€ m) |
153.8 |
115.1 |
33.6% |
26.9% |
|
EBIT margin (%) |
7.3 |
6.6 |
70bps |
|
|
Comparable EBIT margin (%) |
7.4 |
6.7 |
70bps |
50bps |
Net sales revenue grew by 18.2% and 21.5% on an organic and reported basis respectively, as well as positive foreign currency movements from the Polish Zloty and Hungarian Forint.
Organic net sales revenue per case increased by 20.2%, driven by pricing initiatives, and positive category and package mix.
Developing markets volume declined 1.7% on an organic basis, with a better performance in Q4. Sparkling volume declined slightly, while Energy delivered low-teens growth. Stills declined double-digits, as Water and Juice contracted.
·
· In
· Volume in the
Comparable EBIT in the Developing segment increased by 26.9% and 33.6% on an organic and reported basis respectively, to €153.8 million. Comparable EBIT margin was 7.4%, up 50 basis points on an organic basis, as operational leverage and cost control more than offset COGS inflation.
|
Emerging markets |
|
|
|
|
|
|
Full Year |
|
|
|
|
|
2023 |
2022 |
% Change Reported |
% Change Organic |
|
Volume (m unit cases) |
1,735.8 |
1,589.1 |
9.2% |
4.3% |
|
Net sales revenue (€ m) |
4,736.9 |
4,504.6 |
5.2% |
19.9% |
|
Net sales revenue per unit case (€) |
2.73 |
2.83 |
-3.7% |
15.0% |
|
Operating profit (EBIT) (€ m) |
421.8 |
280.3 |
50.5% |
|
|
Comparable EBIT (€ m) |
548.9 |
507.5 |
8.2% |
11.7% |
|
EBIT margin (%) |
8.9 |
6.2 |
270bps |
|
|
Comparable EBIT margin (%) |
11.6 |
11.3 |
30bps |
-80bps |
Net sales revenue grew by 19.9% on an organic basis, or by 5.2% on a reported basis, as currency headwinds from the Nigerian Naira, Egyptian Pound and Russian Rouble offset strong organic growth and the impact of the consolidation of Multon for the first seven months of the year.
Net sales revenue per case grew 15.0% organically, driven by pricing actions taken throughout the year, proactively managing the impact of currency devaluation.
Emerging markets' volume grew by 4.3% organically and 9.2% on a reported basis, which includes the consolidation of Multon. Sparkling volumes grew by mid-single digits and Energy volume grew strong double-digits. Still volumes were broadly unchanged year-on-year.
· Volume in
·
· Volume in
· Volumes in
· Volumes grew by 4.5% in
· Volumes in
Comparable EBIT in the Emerging segment grew by 11.7% on an organic basis and 8.2% on a reported basis, to €548.9 million. Operating profit grew strongly, driven by lower non-cash financial charges compared to prior-year period. Comparable EBIT margin was 11.6%, down 80 basis points on an organic basis, but up 30 basis points on a reported basis, reflecting the mix effect from currency headwinds.
Conference call
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Next event |
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30 April 2024 |
2024 First quarter trading update |
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Enquiries |
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Coca-Cola HBC Group |
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Investors and Analysts: |
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Investor Relations Director (Interim) |
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Tel: +44 7552 619509 john.dawson@cchellenic.com |
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Investor Relations Manager |
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Tel: +44 7740 535130 jemima.benstead@cchellenic.com |
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Investor Relations Manager
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Tel: +44 7864 686582 virginia.phillips@cchellenic.com |
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Media: |
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Head of Communications |
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Tel: +41 7946 88054 sonia.bastian@cchellenic.com |
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Group Senior Communications Manager |
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Tel: +44 7597 562 978 claire.evans@cchellenic.com |
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Greek media contact: V+O Communications Sonia Manesi |
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Tel: +30 694 454 8914 sm@vando.gr |
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Coca-Cola HBC Group
Financial information in this announcement is presented on the basis of
International Financial Reporting Standards ('IFRS')
Special Note Regarding the Information set out herein
Unless otherwise indicated, the condensed consolidated financial statements and the financial and operating data or other information included herein relate to
Forward-Looking Statements
This document contains forward-looking statements that involve risks and uncertainties. These statements may generally, but not always, be identified by the use of words such as 'believe', 'outlook', 'guidance', 'intend', 'expect', 'anticipate', 'plan', 'target' and similar expressions to identify forward-looking statements. All statements other than statements of historical facts, including, among others, statements regarding our future financial position and results, our outlook for 2024 and future years, business strategy and the effects of the global economic slowdown, the impact of the sovereign debt crisis, currency volatility, our recent acquisitions, and restructuring initiatives on our business and financial condition, our future dealings with The Coca-Cola Company, budgets, projected levels of consumption and production, projected raw material and other costs, estimates of capital expenditure, free cash flow, effective tax rates and plans and objectives of management for future operations, are forward-looking statements. By their nature, forward-looking statements involve risk and uncertainty because they reflect our current expectations and assumptions as to future events and circumstances that may not prove accurate. Our actual results and events could differ materially from those anticipated in the forward-looking statements for many reasons, including the risks described in the 2022 Integrated Annual Report for
Although we believe that, as of the date of this document, the expectations reflected in the forward-looking statements are reasonable, we cannot assure you that our future results, level of activity, performance or achievements will meet these expectations. Moreover, neither we, nor our directors, employees, advisors nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. After the date of the condensed consolidated financial statements included in this document, unless we are required by law or the rules of the
Alternative Performance Measures
The Group uses certain Alternative Performance Measures ('APMs') in making financial, operating and planning decisions as well as in evaluating and reporting its performance. These APMs provide additional insights and understanding to the Group's underlying operating and financial performance, financial condition and cash flow. The APMs should be read in conjunction with and do not replace by any means the directly reconcilable IFRS line items. For more details on APMs please refer to 'Definitions and reconciliations of APMs' section.
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Group Financial Review |
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Income statement |
Full Year |
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2023 € million |
2022 € million |
% Change Reported |
% Change Organic5 |
|||
|
Volume (m unit cases) |
2,835.5 |
2,711.8 |
4.6% |
1.7% |
|||
|
Net sales revenue |
10,184.0 |
9,198.4 |
10.7% |
16.9% |
|||
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Net sales revenue per unit case (€) |
3.59 |
3.39 |
5.9% |
15.0% |
|||
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Cost of goods sold |
(6,626.6) |
(6,054.2) |
9.5% |
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Comparable cost of goods sold5 |
(6,622.0) |
(6,050.6) |
9.4% |
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Gross profit |
3,557.4 |
3,144.2 |
13.1% |
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Comparable gross profit5 |
3,562.0 |
3,147.8 |
13.2% |
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Operating expenses (excluding exceptional items related to |
(2,613.5) |
(2,354.6) |
11.0% |
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Exceptional items related to |
- |
(127.4) |
-100.0% |
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Operating expenses |
(2,613.5) |
(2,482.0) |
5.3% |
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Comparable operating expenses5 |
(2,487.9) |
(2,259.7) |
10.1% |
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Share of results of integral equity method investments |
9.7 |
41.6 |
-76.7% |
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Operating profit (EBIT)6 |
953.6 |
703.8 |
35.5% |
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Comparable operating profit (EBIT)5 |
1,083.8 |
929.7 |
16.6% |
17.7% |
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Adjusted EBITDA5 |
1,487.8 |
1,343.6 |
10.7% |
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Comparable adjusted EBITDA5 |
1,506.1 |
1,371.5 |
9.8% |
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Finance costs, net |
(48.3) |
(82.7) |
-41.6% |
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Share of results of non-integral equity method investments |
5.0 |
2.5 |
100.0% |
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Tax |
(274.6) |
(208.0) |
32.0% |
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Comparable tax5 |
(277.1) |
(224.4) |
23.5% |
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Net profit7 |
636.5 |
415.4 |
53.2% |
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Comparable net profit5,7 |
764.2 |
624.9 |
22.3% |
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Basic earnings per share (€) |
1.730 |
1.134 |
52.6% |
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Comparable basic earnings per share (€)5 |
2.078 |
1.706 |
21.8% |
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5Refer to the 'Alternative Performance Measures' and 'Definitions and reconciliations of APMs' sections.
6Refer to the condensed consolidated income statement.
7Net Profit and comparable net profit refer to net profit and comparable net profit respectively after tax attributable to owners of the parent.
Net sales revenue grew by 10.7% in 2023 compared to the prior year. These results were primarily driven by pricing initiatives and the consolidation of Multon for the first seven months of the year as well as mix improvements, which were partially offset by adverse foreign currency movements mainly in connection with the Nigerian Naira, the Russian Rouble and the Egyptian Pound. On an organic basis, net sales revenue grew by 16.9% during 2023, compared to the prior year.
Comparable and reported cost of goods sold increased by 9.4% and 9.5% respectively in 2023 compared to the prior year, due to input cost inflation and the consolidation of Multon for the first seven months of the year.
Comparable operating expenses increased by 10.1% in 2023 compared to the prior year, mainly driven by higher selling and administrative expenses. Operating expenses increased by 5.3% in 2023, due to higher selling and administrative expenses as well as the current-year impairment of goodwill predominantly related to the Group's operations in
Exceptional items related to
Comparable operating profit grew by 16.6% in 2023, compared to the prior year, primarily reflecting the benefits from top-line growth resulting from pricing initiatives and mix improvements, partially offset by adverse foreign currency movements. Operating profit improved by 35.5% in 2023 compared to the prior year, due to top-line growth resulting from pricing initiatives and mix improvements as well as the cycling of prior-year's exceptional items related to
Net finance costs decreased by €34.4 million during 2023 compared to the prior year, mainly driven by higher finance income earned on the Group's cash, cash equivalents and financial assets, partially offset by the increased interest expense from the Green bond issued in September 2022.
On a comparable basis, the effective tax rate was 26.6% for 2023 and 26.4% for 2022. On a reported basis, the effective tax rate was 30.2% for 2023, impacted by the current-year impairment of goodwill, and 33.4% for 2022, respectively. The Group's effective tax rate varies depending on the mix of taxable profits by territory, the non-deductibility of certain expenses, non-taxable income and other one-off tax items across its territories.
Comparable net profit grew by 22.3% compared to the prior year, due to higher operating profitability and lower finance costs, partially offset by higher taxes, while net profit grew by 53.2%, further cycling the impact of prior-year's exceptional items related to
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Balance Sheet |
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As at 31 December |
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|
|
2023 |
2022 |
Change |
|
Assets |
€ million |
€ million |
€ million |
|
Total non-current assets |
5,969.4 |
6,139.5 |
(170.1) |
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Total current assets |
3,910.2 |
3,716.2 |
194.0 |
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Total assets |
9,879.6 |
9,855.7 |
23.9 |
|
Liabilities |
|
|
|
|
Total current liabilities |
3,846.3 |
3,006.7 |
839.6 |
|
Total non-current liabilities |
2,846.6 |
3,463.4 |
(616.8) |
|
Total liabilities |
6,692.9 |
6,470.1 |
222.8 |
|
Equity |
|
|
|
|
Owners of the parent |
3,092.8 |
3,282.3 |
(189.5) |
|
Non-controlling interests |
93.9 |
103.3 |
(9.4) |
|
Total equity |
3,186.7 |
3,385.6 |
(198.9) |
|
Total equity and liabilities |
9,879.6 |
9,855.7 |
23.9 |
|
|
|
|
|
|
Net current assets |
63.9 |
709.5 |
(645.6) |
Total non-current assets decreased by €170.1 million during 2023, primarily driven by foreign currency translation, which was partially offset by the Group's continued investment in property, plant and equipment. Net current assets decreased by €645.6 million, while non-current liabilities decreased by €616.8 million during 2023 respectively, mainly due to the reclassification of the current portion of borrowings from non-current liabilities to current liabilities.
|
Cash flow |
|
|
|
|
|
Full Year |
||
|
|
2023 € million |
2022 € million |
% Change |
|
Net cash from operating activities |
1,386.7 |
1,234.6 |
12.3% |
|
Capital expenditure8 |
(674.9) |
(589.5) |
14.5% |
|
Free cash flow8 |
711.8 |
645.1 |
10.3% |
8Refer to the 'Definitions and reconciliations of APMs' section.
Net cash from operating activities increased by 12.3% or €152.1 million during 2023, compared to the prior year, mainly due to increased operating profitability excluding non-cash charges, partially offset by higher taxes paid.
Capital expenditure increased by 14.5% in 2023, compared to the prior year. In 2023, capital expenditure amounted to €674.9 million of which 53% was related to investment in production equipment and facilities and 17% to the acquisition of marketing equipment. In 2022, capital expenditure amounted to €589.5 million of which 53% was related to investment in production equipment and facilities and 20% to the acquisition of marketing equipment.
In 2023, free cash flow increased by 10.3% or €66.7 million, compared to the prior-year period, driven by the increased cash from operating activities, partially offset by increased capital expenditure.
Definitions and reconciliations of Alternative Performance Measures ("APMs")
1. Comparable APMs9
In discussing the performance of the Group, "comparable" measures are used. In 2023, the Group updated the definitions of items which are deducted from the directly reconcilable IFRS measures to calculate comparable APMs, to include impairment of goodwill and indefinite-lived intangible assets. This update was performed to provide more relevant information on the Group's ongoing operating and financial performance, considering also reporting by its peer group and had no impact on the comparative figures disclosed.
More specifically, comparable measures are calculated by deducting from the directly reconcilable IFRS measures the impact of the Group's restructuring costs, the mark-to-market valuation of the commodity hedging activity, the acquisition, integration and divestment-related costs, the impairment of goodwill and indefinite-lived intangible assets, the
1) Restructuring costs
Restructuring costs comprise costs arising from significant changes in the way the Group conducts business, such as significant supply chain infrastructure changes, outsourcing of activities and centralisation of processes. These costs are included within the income statement line 'Operating expenses'; however, they are excluded from the comparable results so that the users can obtain a better understanding of the Group's operating and financial performance achieved from underlying activity. Restructuring costs resulting from initiatives driven by the
2) Commodity hedging
The Group has entered into certain commodity derivative transactions in order to hedge its exposure to commodity price risk.
Although these transactions are economic hedging activities that aim to manage our exposure to sugar, aluminium, gas oil and plastics price volatility, hedge accounting has not been applied in all cases. In addition, the Group recognises certain derivatives embedded within commodity purchase contracts that have been accounted for as stand-alone derivatives and do not qualify for hedge accounting. The fair value gains or losses on the derivatives and embedded derivatives are immediately recognised in the income statement in the cost of goods sold and operating expenses line items. The Group's comparable results exclude the gains or losses resulting from the mark-to-market valuation of these derivatives to which hedge accounting has not been applied (primarily plastics) and embedded derivatives. These gains or losses are reflected in the comparable results in the period when the underlying transactions occur, to match the profit or loss to that of the corresponding underlying transactions. We believe this adjustment provides useful information related to the impact of our economic risk management activities.
3) Acquisition, integration and divestment-related costs or gains
Acquisition costs comprise costs incurred to effect a business combination such as finder's fees, advisory, legal, accounting, valuation and other professional or consulting fees as well as changes in the fair value of contingent consideration recognised in the income statement. They also include any gain from bargain purchase arising from business combinations, as well as any gain or loss recognised in the income statement from the remeasurement to fair value of previously held interests and the reclassification to the income statement of items of other comprehensive income resulting from step acquisitions. Integration costs comprise direct incremental costs necessary for the acquiree to operate within the Group. Divestment-related costs comprise transaction expenses, including advisory, consulting, and other professional fees to effect the disposal of a subsidiary or equity method investment, any impairment losses or write-downs to fair value less costs to sell recognised in the income statement upon classification as held for sale and any relevant disposal gains or losses or reversals of impairment recognised in the income statement upon disposal. These costs or gains are included within the income statement line 'Operating expenses', however, to the extent that they relate to business combinations or divestments that have been completed or are expected to be completed, they are excluded from the comparable results so that the users can obtain a better understanding of the Group's operating and financial performance achieved from underlying activity.
4) Impairment of goodwill and indefinite-lived intangible assets
Impairment losses recognised for goodwill and indefinite-lived intangible assets as well as reversals of impairment losses recognised for indefinite-lived intangible assets, are included within the income statement line 'Operating expenses'; however are excluded from comparable results so that the users can obtain a better understanding of the Group's ongoing operating and financial performance.
5)
As a result of the conflict between
6) Other tax items
Other tax items represent the tax impact of (a) changes in income tax rates affecting the opening balance of deferred tax arising during the year and (b) certain tax-related matters selected based on their nature. Both (a) and (b) are excluded from comparable after-tax results so that the users can obtain a better understanding of the Group's underlying financial performance.
9Comparable APMs refer to comparable COGS, comparable gross profit, comparable operating expenses, comparable EBIT, comparable EBIT margin, comparable Adjusted EBITDA, comparable profit before tax, comparable tax, comparable net profit and comparable EPS
The Group discloses comparable performance measures to enable users to focus on the underlying performance of the business on a basis which is common to both periods for which these measures are presented. The reconciliation of comparable measures to the directly related measures calculated in accordance with IFRS is as follows:
Reconciliation of comparable financial indicators (numbers in € million except per share data)
|
|
Full Year 2023 |
||||||||||
|
|
COGS |
Gross Profit |
Operating expenses |
EBIT |
Adjusted EBITDA |
Profit before tax |
Tax |
Net Profit10 |
EPS (€) |
||
|
As reported |
(6,626.6) |
3,557.4 |
(2,613.5) |
953.6 |
1,487.8 |
910.3 |
(274.6) |
636.5 |
1.730 |
||
|
Restructuring costs |
- |
- |
8.3 |
8.3 |
6.9 |
8.3 |
(1.6) |
6.7 |
0.018 |
||
|
Commodity hedging |
4.6 |
4.6 |
- |
4.6 |
4.6 |
4.6 |
(1.3) |
3.3 |
0.009 |
||
|
Acquisition costs |
- |
- |
6.3 |
6.3 |
6.3 |
6.3 |
- |
6.3 |
0.017 |
||
|
|
- |
- |
0.5 |
0.5 |
0.5 |
0.5 |
(0.1) |
0.4 |
0.001 |
||
|
Impairment of goodwill and indefinite-lived intangible assets |
- |
- |
110.5 |
110.5 |
- |
110.5 |
- |
110.5 |
0.301 |
||
|
Other tax items |
- |
- |
- |
- |
- |
- |
0.5 |
0.5 |
0.002 |
||
|
Comparable |
(6,622.0) |
3,562.0 |
(2,487.9) |
1,083.8 |
1,506.1 |
1,040.5 |
(277.1) |
764.2 |
2.078 |
||
|
|
|
|
|
||||||||
|
|
Full Year 2022 |
||||||||||
|
|
COGS |
Gross Profit |
Operating expenses |
EBIT |
Adjusted EBITDA |
Profit before tax |
Tax |
Net Profit10 |
EPS (€) |
||
|
As reported |
(6,054.2) |
3,144.2 |
(2,482.0) |
703.8 |
1,343.6 |
623.6 |
(208.0) |
415.4 |
1.134 |
||
|
Restructuring costs |
- |
- |
8.0 |
8.0 |
7.9 |
8.0 |
(1.7) |
6.3 |
0.017 |
||
|
Commodity hedging |
2.5 |
2.5 |
- |
2.5 |
2.5 |
2.5 |
(0.5) |
2.0 |
0.005 |
||
|
Acquisition and integration costs |
- |
- |
79.7 |
79.7 |
9.2 |
79.7 |
- |
79.7 |
0.218 |
||
|
|
1.1 |
1.1 |
134.6 |
135.7 |
8.3 |
135.7 |
(13.8) |
121.9 |
0.333 |
||
|
Other tax items |
- |
- |
- |
- |
- |
- |
(0.4) |
(0.4) |
(0.001) |
||
|
Comparable |
(6,050.6) |
3,147.8 |
(2,259.7) |
929.7 |
1,371.5 |
849.5 |
(224.4) |
624.9 |
1.706 |
||
10 Net Profit and comparable net profit refer to net profit and comparable net profit respectively after tax attributable to owners of the parent.
|
Reconciliation of comparable EBIT per reportable segment (numbers in € million) |
|
|
Full Year 2023 |
||||||
|
|
Established |
Developing |
Emerging |
Consolidated |
|||
|
EBIT |
379.2 |
152.6 |
421.8 |
953.6 |
|||
|
Restructuring costs |
0.9 |
1.1 |
6.3 |
8.3 |
|||
|
Commodity hedging |
(0.9) |
(2.0) |
7.5 |
4.6 |
|||
|
Acquisition costs |
1.9 |
1.0 |
3.4 |
6.3 |
|||
|
|
- |
- |
0.5 |
0.5 |
|||
|
Impairment of goodwill and indefinite-lived intangible assets |
- |
1.1 |
109.4 |
110.5 |
|||
|
Comparable EBIT |
381.1 |
153.8 |
548.9 |
1,083.8 |
|||
|
|
|
|
|
|
|||
|
|
Full Year 2022 |
||||||
|
|
Established |
Developing |
Emerging |
Consolidated |
|||
|
EBIT |
310.4 |
113.1 |
280.3 |
703.8 |
|||
|
Restructuring costs |
(6.1) |
(1.5) |
15.6 |
8.0 |
|||
|
Commodity hedging |
2.5 |
3.5 |
(3.5) |
2.5 |
|||
|
Acquisition and integration costs |
0.3 |
- |
79.4 |
79.7 |
|||
|
|
- |
- |
135.7 |
135.7 |
|||
|
Comparable EBIT |
307.1 |
115.1 |
507.5 |
929.7 |
|||
2. Organic APMs
Organic growth
Organic growth enables users to focus on the operating performance of the business on a basis which is not affected by changes in foreign currency exchange rates from year to year or changes in the Group's scope of consolidation ('consolidation perimeter') i.e. acquisitions, divestments and reorganisations resulting in equity method accounting. Thus, organic growth is designed to assist users in better understanding the Group's underlying performance.
More specifically, the following items are adjusted from the Group's volume, net sales revenue and comparable EBIT in order to derive organic growth metrics:
(a) Foreign Currency impact
Foreign Currency impact in the organic growth calculation reflects the adjustment of prior-year net sales revenue and comparable EBIT metrics for the impact of changes in exchange rates applicable to the current year.
(b) Consolidation perimeter impact
Current year volume, net sales revenue and comparable EBIT metrics, are each adjusted for the impact of changes in the consolidation perimeter. More specifically adjustments are performed as follows:
i. Acquisitions:
For current year acquisitions, the results generated in the current year by the acquired entities are not included in the organic growth calculation. For prior year acquisitions, the results generated in the current year over the period during which the acquired entities were not consolidated in the prior year, are not included in the organic growth calculation.
For current year step acquisitions where the Group obtains control of a) entities over which it previously held either joint control or significant influence and which were accounted for under the equity method, or b) entities which were carried at fair value either through profit or loss or other comprehensive income, the results generated in the current year by the relevant entities over the period during which these entities are consolidated, are not included in the organic growth calculation. For such step acquisitions of entities previously accounted for under the equity method the share of results for the respective period described above, is included in the organic growth calculation of the current year. For such step acquisitions of entities previously accounted for at fair value through profit or loss any fair value gains or losses for the respective period described above, are included in the organic growth calculation. For such step acquisitions in the prior year, the results generated in the current year by the relevant entities over the period during which these entities were not consolidated in the prior year, are not included in the organic growth calculation. However, the share of results or gains or losses from fair value changes of the respective entities, based on their accounting treatment prior to the step acquisition, for the current-year period during which these entities were not consolidated in the prior year are included in the organic growth calculation.
ii. Divestments:
For current year divestments, the results generated in the prior year by the divested entities over the period during which the divested entities are no longer consolidated in the current year, are included in the current year's results for the purpose of the organic growth calculation. For prior-year divestments, the results generated in the prior year by the divested entities over the period during which the divested entities were consolidated, are included in the current year's results for the purpose of the organic growth calculation.
iii. Reorganisations resulting in equity method accounting:
For current year reorganisations where the Group maintains either joint control or significant influence over the relevant entities so that they are reclassified from subsidiaries or joint operations to joint ventures or associates and accounted for under the equity method, the results generated in the current year by the relevant entities over the period during which these entities are no longer consolidated, are included in the current year's results for the purpose of the organic growth calculation. For such reorganisations in the prior year, the results generated in the current year by the relevant entities over the period during which these entities were consolidated in the prior year, are included in the current year's results for the purpose of the organic growth calculation. In addition, the share of results in the current year of the relevant entities, for the respective period as described above, is excluded from the organic growth calculation for such reorganisations.
The calculations of the organic growth and the reconciliation to the most directly related measures calculated in accordance with IFRS are presented in the below tables. Organic growth (%) is calculated by dividing the amount in the row titled 'Organic movement' by the amount in the associated row titled '2022 reported' or, where presented, '2022 adjusted'. Organic growth for comparable EBIT margin is the organic movement expressed in basis points.
Reconciliation of organic measures
|
|
Full Year 2023 |
|||
|
Volume (m unit cases) |
Established |
Developing |
Emerging |
Group |
|
2022 reported |
643.9 |
478.8 |
1,589.1 |
2,711.8 |
|
Consolidation perimeter impact |
0.3 |
0.4 |
78.0 |
78.7 |
|
Organic movement |
-15.5 |
-8.2 |
68.7 |
45.0 |
|
2023 reported |
628.7 |
471.0 |
1,735.8 |
2,835.5 |
|
|
|
|
|
|
|
Organic growth (%) |
-2.4% |
-1.7% |
4.3% |
1.7% |
|
|
Full Year 2023 |
|||
|
Net sales revenue (€ m) |
Established |
Developing |
Emerging |
Group |
|
2022 reported |
2,974.1 |
1,719.7 |
4,504.6 |
9,198.4 |
|
Foreign currency impact |
11.0 |
41.8 |
-816.7 |
-763.9 |
|
2022 adjusted |
2,985.1 |
1,761.5 |
3,687.9 |
8,434.5 |
|
Consolidation perimeter impact |
4.9 |
7.0 |
313.5 |
325.4 |
|
Organic movement |
368.5 |
320.1 |
735.5 |
1,424.1 |
|
2023 reported |
3,358.5 |
2,088.6 |
4,736.9 |
10,184.0 |
|
|
|
|
|
|
|
Organic growth (%) |
12.3% |
18.2% |
19.9% |
16.9% |
|
|
Full Year 2023 |
|||
|
Net sales revenue per unit case (€)11 |
Established |
Developing |
Emerging |
Group |
|
2022 reported |
4.62 |
3.59 |
2.83 |
3.39 |
|
Foreign currency impact |
0.02 |
0.09 |
-0.51 |
-0.28 |
|
2022 adjusted |
4.64 |
3.68 |
2.32 |
3.11 |
|
Consolidation perimeter impact |
0.01 |
0.01 |
0.06 |
0.02 |
|
Organic movement |
0.70 |
0.74 |
0.35 |
0.47 |
|
2023 reported |
5.34 |
4.43 |
2.73 |
3.59 |
|
|
|
|
|
|
|
Organic growth (%) |
15.1% |
20.2% |
15.0% |
15.0% |
|
|
Full Year 2023 |
|||
|
Comparable EBIT (€ m) |
Established |
Developing |
Emerging |
Group |
|
2022 reported |
307.1 |
115.1 |
507.5 |
929.7 |
|
Foreign currency impact |
2.1 |
3.9 |
-55.7 |
-49.7 |
|
2022 adjusted |
309.2 |
119.0 |
451.8 |
880.0 |
|
Consolidation perimeter impact |
0.8 |
2.8 |
44.3 |
47.9 |
|
Organic movement |
71.1 |
32.0 |
52.8 |
155.9 |
|
2023 reported |
381.1 |
153.8 |
548.9 |
1,083.8 |
|
|
|
|
|
|
|
Organic growth (%) |
23.0% |
26.9% |
11.7% |
17.7% |
|
|
Full Year 2023 |
|||
|
Comparable EBIT Margin (%)11 |
Established |
Developing |
Emerging |
Group |
|
2022 reported |
10.3% |
6.7% |
11.3% |
10.1% |
|
Foreign currency impact |
- |
0.1% |
1.0% |
0.3% |
|
2022 adjusted |
10.4% |
6.8% |
12.3% |
10.4% |
|
Consolidation perimeter impact |
- |
0.1% |
0.2% |
0.1% |
|
Organic movement |
1.0% |
0.5% |
-0.8% |
0.1% |
|
2023 reported |
11.3% |
7.4% |
11.6% |
10.6% |
|
|
|
|
|
|
|
Organic growth (%) |
100bps |
50bps |
-80bps |
10bps |
11 Certain differences in calculations are due to rounding.
3. Other APMs
Adjusted EBITDA
Adjusted EBITDA is calculated by adding back to operating profit the depreciation and net impairment of property, plant and equipment, the amortisation and impairment of intangible assets, the net impairment of equity method investments, the employee share option and performance share costs and items, if any, reported in line 'Other non-cash items' of the condensed consolidated cash flow statement. Adjusted EBITDA is intended to provide useful information to analyse the Group's operating performance excluding the impact of operating non-cash items as defined above. The Group also uses comparable Adjusted EBITDA, which is calculated by deducting from Adjusted EBITDA the impact of: the Group's restructuring costs, the acquisition, integration and divestment-related costs, the mark-to-market valuation of the commodity hedging activity and the impact from the
Adjusted EBITDA and comparable Adjusted EBITDA are not measures of profitability and liquidity under IFRS and have limitations, some of which are as follows: Adjusted EBITDA and comparable Adjusted EBITDA do not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments; Adjusted EBITDA and comparable Adjusted EBITDA do not reflect changes in, or cash requirements for, our working capital needs; although depreciation and amortisation are non-cash charges, the assets being depreciated and amortised will often have to be replaced in the future, and Adjusted EBITDA and comparable Adjusted EBITDA do not reflect any cash requirements for such replacements. Because of these limitations, Adjusted EBITDA and comparable Adjusted EBITDA should not be considered as measures of discretionary cash available to us and should be used only as supplementary APMs.
Free cash flow
Free cash flow is an APM used by the Group and defined as cash generated by operating activities after payments for purchases of property, plant and equipment net of proceeds from sales of property, plant and equipment and including principal repayments of lease obligations. Free cash flow is intended to measure the cash generation from the Group's business, based on operating activities, including the efficient use of working capital and taking into account its net payments for purchases of property, plant and equipment. The Group considers the purchase and disposal of property, plant and equipment as ultimately non‑discretionary since ongoing investment in plant, machinery, technology and marketing equipment, including coolers, is required to support the day-to-day operations and the Group's growth prospects. The Group presents free cash flow because it believes the measure assists users of the financial statements in understanding the Group's cash generating performance as well as availability for interest payment, dividend distribution and own retention. The free cash flow measure is used by management for its own planning and reporting purposes since it provides information on operating cash flows, working capital changes and net capital expenditure that local managers are most directly able to influence.
Free cash flow is not a measure of cash generation under IFRS and has limitations, some of which are as follows: free cash flow does not represent the Group's residual cash flow available for discretionary expenditures since the Group has debt payment obligations that are not deducted from the measure; free cash flow does not deduct cash flows used by the Group in other investing and financing activities and free cash flow does not deduct certain items settled in cash. Other companies in the industry in which the Group operates may calculate free cash flow differently, limiting its usefulness as a comparative measure.
Capital expenditure
Capital expenditure is defined as payments for purchases of property, plant and equipment plus principal repayments of lease obligations less proceeds from sales of property, plant and equipment. The Group uses capital expenditure as an APM to ensure that the cash spending is in line with its overall strategy for the use of cash.
The following table illustrates how Adjusted EBITDA, Free Cash Flow and Capital Expenditure are calculated:
|
|
Full Year |
Full Year |
|
|
2023 |
2022 |
|
|
€ million |
€ million |
|
Operating profit (EBIT) |
953.6 |
703.8 |
|
Depreciation and impairment of property, plant and equipment, including right-of-use assets |
399.9 |
484.9 |
|
Amortisation and impairment of intangible assets |
113.9 |
15.1 |
|
Employee performance shares |
20.4 |
16.5 |
|
Impairment of equity method investments |
- |
52.8 |
|
Other non-cash items included in operating profit12 |
- |
70.5 |
|
Adjusted EBITDA |
1,487.8 |
1,343.6 |
|
Share of results of integral equity method investments |
(9.7) |
(41.6) |
|
(Gain) / loss on disposals of non-current assets |
(1.3) |
1.5 |
|
Cash generated from working capital movements |
135.7 |
126.8 |
|
Tax paid |
(225.8) |
(195.7) |
|
Net cash from operating activities |
1,386.7 |
1,234.6 |
|
Payments for purchases of property, plant and equipment13 |
(623.0) |
(531.8) |
|
Principal repayments of lease obligations |
(59.1) |
(65.2) |
|
Proceeds from sales of property, plant and equipment |
7.2 |
7.5 |
|
Capital expenditure |
(674.9) |
(589.5) |
|
Free cash flow |
711.8 |
645.1 |
12Other non-cash items included in operating profit for 2022 relate to the net loss recognised in the income statement from the remeasurement to fair value of the previously held interest, the reclassification to the income statement of items of other comprehensive income and the gain from bargain purchase arising due to the change in control of Multon Z.A.O. group of companies ('Multon'), For more details, refer to Note 24 of the Group's 2022 Integrated Annual Report.
13Payments for purchases of property, plant and equipment for 2023 include €12.3 million (2022: €8.4 million) relating to repayment of borrowings undertaken to finance the purchase of production equipment by the Group's subsidiary in
Net debt
Net debt is an APM used by management to evaluate the Group's capital structure and leverage. Net debt is defined as current borrowings plus non-current borrowings less cash and cash equivalents and financial assets (time deposits and money market funds), as illustrated below:
|
|
As at 31 December |
|
|
|
2023 |
2022 |
|
|
€ million |
€ million |
|
Current borrowings |
948.1 |
337.0 |
|
Non-current borrowings |
2,476.4 |
3,082.9 |
|
Other financial assets |
(568.6) |
(1,026.7) |
|
Cash and cash equivalents |
(1,260.6) |
(719.9) |
|
Net debt |
1,595.3 |
1,673.3 |
Return on invested capital ('ROIC')
ROIC is an APM used by management to assess the return obtained from the Group's asset base and is defined as the percentage of comparable net profit excluding net finance costs divided by the five-quarter average capital invested in the business ('capital employed'). Capital employed is defined as the average net debt and shareholders' equity attributable to the owners of the parent, as illustrated below. The Group presents ROIC because it believes the measure assists users of the financial statements in understanding the Group's capital efficiency.
|
|
Year ended |
|
|
|
31 December 2023 € million |
31 December 2022 € million |
|
Comparable operating profit |
1,083.8 |
929.7 |
|
Plus: Share of results of non-integral equity method investments |
5.0 |
2.5 |
|
Less: Comparable tax |
(277.1) |
(224.4) |
|
Tax shield14 |
(13.0) |
(21.5) |
|
Comparable net profit excl. finance costs, net (a) |
798.7 |
686.3 |
|
|
|
|
|
Average net debt16 |
1,676.1 |
1,575.2 |
|
Plus: Average equity attributable to owners of the parent16 |
3,194.2 |
3,300.4 |
|
Capital employed (b) |
4,870.3 |
4,875.6 |
|
|
|
|
|
Return on invested capital (a/b) |
16.4% |
14.1% |
14Tax shield is calculated as comparable effective tax rate times finance costs, net as illustrated below:
|
|
Year ended |
|
|
|
31 December 2023 € million |
31 December 2022 € million |
|
Finance costs, net |
48.3 |
82.7 |
|
Comparable effective tax rate (%)15 |
27% |
26% |
|
Tax shield |
13.0 |
21.5 |
|
|
|
|
15Comparable effective tax rate is calculated as comparable tax divided by comparable profit before tax, as illustrated below:
|
|
Year ended |
|
|
|
31 December 2023 € million |
31 December 2022 € million |
|
Comparable tax |
277.1 |
224.4 |
|
Comparable profit before tax |
1,040.5 |
849.5 |
|
Comparable effective tax rate (%) |
27% |
26% |
|
|
|
|
16Five-quarter average net debt and equity attributable to owners of the parent are calculated as presented below:
|
2023 |
Q4 2022 € million |
Q1 2023 € million |
Q2 2023 € million |
Q3 2023 € million |
Q4 2023 € million |
Average € million* |
||||
|
Net debt |
1,673.3 |
1,827.2 |
1,779.4 |
1,504.9 |
1,595.3 |
1,676.1 |
||||
|
Equity attributable to owners of the parent |
3,282.3 |
3,255.2 |
3,005.0 |
3,335.6 |
3,092.8 |
3,194.2 |
||||
|
|
|
|
|
|
|
|
||||
|
2022 |
Q4 2021 € million |
Q1 2022 € million |
Q2 2022 € million |
Q3 2022 € million |
Q4 2022 € million |
Average € million* |
||||
|
Net debt |
1,319.7 |
1,881.9 |
1,584.1 |
1,417.2 |
1,673.3 |
1,575.2 |
||||
|
Equity attributable to owners of the parent |
3,114.5 |
3,203.5 |
3,275.7 |
3,626.1 |
3,282.3 |
3,300.4 |
||||
|
|
|
|
|
|
|
|
||||
*Certain differences in calculations are due to rounding.
Condensed consolidated financial statements for the six months and the year ended
31 December 2023
Condensed consolidated income statement (unaudited)
|
|
|
Six months ended 31 December |
||
|
|
Note |
2023 |
|
2022 |
|
€ million |
€ million |
|||
|
Net sales revenue |
3 |
5,162.5 |
|
4,988.5 |
|
Cost of goods sold |
|
(3,366.7) |
|
(3,294.5) |
|
Gross profit |
|
1,795.8 |
|
1,694.0 |
|
|
|
|
|
|
|
Operating expenses (excluding exceptional items related to |
|
(1,405.1) |
|
(1,339.3) |
|
Exceptional items related to |
|
- |
|
56.2 |
|
Operating expenses
|
|
(1,405.1) |
|
(1,283.1) |
|
Share of results of integral equity method investments |
|
5.6 |
|
17.2 |
|
Operating profit |
3 |
396.3 |
|
428.1 |
|
|
|
|
|
|
|
Finance costs, net |
5 |
(16.9) |
|
(40.0) |
|
Share of results of non-integral equity method investments |
|
3.3 |
|
1.1 |
|
Profit before tax |
|
382.7 |
|
389.2 |
|
|
|
|
|
|
|
Tax |
6 |
(132.1) |
|
(126.0) |
|
Profit after tax |
|
250.6 |
|
263.2 |
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
Owners of the parent |
|
250.8 |
|
262.5 |
|
Non-controlling interests |
|
(0.2) |
|
0.7 |
|
|
|
250.6 |
|
263.2 |
|
|
|
|
|
|
|
Basic and diluted earnings per share (€) |
7 |
0.68 |
|
0.72 |
Condensed consolidated statement of comprehensive income (unaudited)
|
|
Six months ended 31 December |
|
|
|
2023 |
2022 |
|
€ million |
€ million |
|
|
Profit after tax |
250.6 |
263.2 |
|
|
|
|
|
Other comprehensive income: |
|
|
|
Items that may be subsequently reclassified to income statement: |
|
|
|
Cost of hedging |
(4.4) |
(3.2) |
|
Net gain of cash flow hedges |
1.3 |
10.1 |
|
Foreign currency translation losses |
(91.6) |
(388.5) |
|
Share of other comprehensive loss of equity method investments |
(3.9) |
(10.1) |
|
Reclassification of share of other comprehensive income of equity method investments to income statement arising from business combination |
- |
145.2 |
|
Income tax relating to items that may be subsequently reclassified to income statement |
(0.5) |
- |
|
|
(99.1) |
(246.5) |
|
Items that will not be subsequently reclassified to income statement: |
|
|
|
Actuarial losses |
(19.7) |
(13.2) |
|
Income tax relating to items that will not be subsequently reclassified to income statement |
2.7 |
2.9 |
|
|
(17.0) |
(10.3) |
|
Other comprehensive loss for the period, net of tax |
(116.1) |
(256.8) |
|
Total comprehensive income for the period |
134.5 |
6.4 |
|
|
|
|
|
Total comprehensive income attributable to: |
|
|
|
Owners of the parent |
136.2 |
12.5 |
|
Non-controlling interests |
(1.7) |
(6.1) |
|
|
134.5 |
6.4 |
Condensed consolidated income statement (unaudited)
|
|
|
Year ended 31 December |
||
|
|
Note |
2023 |
|
2022 |
|
€ million |
€ million |
|||
|
Net sales revenue |
3 |
10,184.0 |
|
9,198.4 |
|
Cost of goods sold |
|
(6,626.6) |
|
(6,054.2) |
|
Gross profit |
|
3,557.4 |
|
3,144.2 |
|
|
|
|
|
|
|
Operating expenses (excluding exceptional items related to |
|
(2,613.5) |
|
(2,354.6) |
|
Exceptional items related to |
|
- |
|
(127.4) |
|
Operating expenses |
|
(2,613.5) |
|
(2,482.0) |
|
Share of results of integral equity method investments |
|
9.7 |
|
41.6 |
|
Operating profit |
3 |
953.6 |
|
703.8 |
|
|
|
|
|
|
|
Finance costs, net |
5 |
(48.3) |
|
(82.7) |
|
Share of results of non-integral equity method investments |
|
5.0 |
|
2.5 |
|
Profit before tax |
|
910.3 |
|
623.6 |
|
|
|
|
|
|
|
Tax |
6 |
(274.6) |
|
(208.0) |
|
Profit after tax |
|
635.7 |
|
415.6 |
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
Owners of the parent |
|
636.5 |
|
415.4 |
|
Non-controlling interests |
|
(0.8) |
|
0.2 |
|
|
|
635.7 |
|
415.6 |
|
|
|
|
|
|
|
Basic and diluted earnings per share (€) |
7 |
1.73 |
|
1.13 |
Condensed consolidated statement of comprehensive income (unaudited)
|
|
Year ended 31 December |
|
|
|
2023 |
2022 |
|
€ million |
€ million |
|
|
Profit after tax |
635.7 |
415.6 |
|
|
|
|
|
Other comprehensive income: |
|
|
|
Items that may be subsequently reclassified to income statement: |
|
|
|
|
|
|
|
Cost of hedging |
(7.1) |
(3.5) |
|
Net gain of cash flow hedges |
19.7 |
34.6 |
|
Foreign currency translation losses |
(484.6) |
(252.6) |
|
Share of other comprehensive (loss) / income of equity method investments |
(11.7) |
34.2 |
|
Reclassification of share of other comprehensive income of equity method investments to income statement arising from business combination |
- |
145.2 |
|
Income tax relating to items that may be subsequently reclassified to income statement |
(3.0) |
(3.9) |
|
|
(486.7) |
(46.0) |
|
Items that will not be subsequently reclassified to income statement: |
|
|
|
Valuation gain / (loss) on equity investments at fair value through other comprehensive income |
0.4 |
(0.1) |
|
Actuarial (losses) / gains |
(16.4) |
26.0 |
|
Income tax relating to items that will not be subsequently reclassified to income statement |
1.9 |
1.8 |
|
|
(14.1) |
27.7 |
|
Other comprehensive loss for the year, net of tax |
(500.8) |
(18.3) |
|
Total comprehensive income for the year |
134.9 |
397.3 |
|
|
|
|
|
Total comprehensive income attributable to: |
|
|
|
Owners of the parent |
141.3 |
406.1 |
|
Non-controlling interests |
(6.4) |
(8.8) |
|
|
134.9 |
397.3 |
Condensed consolidated balance sheet (unaudited)
|
|
|
As at 31 December |
||
|
|
|
2023 |
2022 |
|
|
Note |
€ million |
€ million |
||
|
Assets |
|
|
|
|
|
Intangible assets |
8 |
2,568.6 |
2,542.5 |
|
|
Property, plant and equipment |
8 |
3,057.1 |
3,266.3 |
|
|
Other non-current assets |
|
343.7 |
330.7 |
|
|
Total non-current assets |
|
5,969.4 |
6,139.5 |
|
|
|
|
|
|
|
|
Inventories |
|
773.3 |
770.0 |
|
|
Trade, other receivables and assets |
|
1,205.1 |
1,162.4 |
|
|
Other financial assets |
10 |
667.9 |
1,063.8 |
|
|
Cash and cash equivalents |
10 |
1,260.6 |
719.9 |
|
|
|
|
3,906.9 |
3,716.1 |
|
|
Assets classified as held for sale |
|
3.3 |
0.1 |
|
|
Total current assets |
|
3,910.2 |
3,716.2 |
|
|
Total assets |
|
9,879.6 |
9,855.7 |
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
Borrowings |
10 |
948.1 |
337.0 |
|
|
Other current liabilities |
|
2,898.2 |
2,669.7 |
|
|
Total current liabilities |
|
3,846.3 |
3,006.7 |
|
|
|
|
|
|
|
|
Borrowings |
10 |
2,476.4 |
3,082.9 |
|
|
Other non-current liabilities |
|
370.2 |
380.5 |
|
|
Total non-current liabilities |
|
2,846.6 |
3,463.4 |
|
|
Total liabilities |
|
6,692.9 |
6,470.1 |
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
Owners of the parent |
|
3,092.8 |
3,282.3 |
|
|
Non-controlling interests |
|
93.9 |
103.3 |
|
|
Total equity |
|
3,186.7 |
3,385.6 |
|
|
Total equity and liabilities |
|
9,879.6 |
9,855.7 |
|
Condensed consolidated statement of changes in equity (unaudited)
|
|
Attributable to owners of the parent |
|
|
||||||||
|
|
Share capital € million |
Share premium € million |
Group reorganisation reserve € million |
€ million |
Exchange equalisation reserve € million |
Other reserves € million |
Retained earnings € million |
Total € million |
Non-controlling interests € million |
Total equity € million |
|
|
Balance as at 1 January 2022 |
2,022.3 |
3,097.3 |
(6,472.1) |
(146.6) |
(1,154.0) |
310.2 |
5,457.4 |
3,114.5 |
2.6 |
3,117.1 |
|
|
Shares issued to employees exercising stock options (Note 11) |
2.0 |
2.7 |
- |
- |
- |
- |
- |
4.7 |
- |
4.7 |
|
|
Share-based compensation: |
|
|
|
|
|
|
|
|
|
|
|
|
Performance shares |
- |
- |
- |
- |
- |
16.6 |
- |
16.6 |
- |
16.6 |
|
|
Movement in shares held for equity compensation plan |
- |
- |
- |
- |
- |
1.2 |
- |
1.2 |
- |
1.2 |
|
|
Appropriation of reserves (Note 11) |
- |
- |
- |
15.4 |
- |
(21.1) |
5.7 |
- |
- |
- |
|
|
Non-controlling interests on business combinations |
- |
- |
- |
- |
- |
- |
- |
- |
259.6 |
259.6 |
|
|
Purchase of shares held by non-controlling interests (Note 14) |
- |
- |
- |
- |
- |
- |
40.9 |
40.9 |
(149.8) |
(108.9) |
|
|
Dividends (Note 13) |
- |
(262.6) |
- |
- |
- |
- |
2.4 |
(260.2) |
(0.3) |
(260.5) |
|
|
Transfer of cash flow hedge reserve, including cost of hedging to inventories, net of tax 1 |
- |
- |
- |
- |
- |
(41.5) |
- |
(41.5) |
- |
(41.5) |
|
|
|
2,024.3 |
2,837.4 |
(6,472.1) |
(131.2) |
(1,154.0) |
265.4 |
5,506.4 |
2,876.2 |
112.1 |
2,988.3 |
|
|
Profit for the year, net of tax |
- |
- |
- |
- |
- |
- |
415.4 |
415.4 |
0.2 |
415.6 |
|
|
Other comprehensive loss for the year, net of tax |
- |
- |
- |
- |
(64.2) |
27.1 |
27.8 |
(9.3) |
(9.0) |
(18.3) |
|
|
Total comprehensive income for the year, net of tax2 |
- |
- |
- |
- |
(64.2) |
27.1 |
443.2 |
406.1 |
(8.8) |
397.3 |
|
|
Balance as at 31 December 2022 |
2,024.3 |
2,837.4 |
(6,472.1) |
(131.2) |
(1,218.2) |
292.5 |
5,949.6 |
3,282.3 |
103.3 |
3,385.6 |
|
1The amount included in other reserves of €41.5 million represents the cash flow hedge reserve, including cost of hedging, transferred to inventories of €51.4 million gain, and the deferred tax expense thereof amounting to €9.9 million.
2The amount included in the exchange equalisation reserve of €64.2 million loss for 2022 represents the exchange loss attributable to owners of the parent, mainly related to the Egyptian Pound, including €34.8 million gain relating to the share of other comprehensive income of equity method investments and €144.6 million gain relating to reclassification of share of other comprehensive income of equity method investments to the income statement arising from business combination.
The amount of other comprehensive income, net of tax included in other reserves of €27.1 million gain for 2022 consists of cash flow hedges gain of €31.1 million, share of other comprehensive income of equity method investments of €0.6 million loss, valuation losses of €0.1 million on equity investments at fair value through other comprehensive income, €0.6 million gain relating to reclassification of share of other comprehensive income of equity method investments to the income statement arising from business combination, and the deferred tax expense thereof amounting to €3.9 million.
The amount of €443.2 million gain attributable to owners of the parent for 2022 comprises profit for the year, net of tax of €415.4 million, actuarial gains of €26.0 million and the deferred tax income thereof amounting to €1.8 million.
The amount of €8.8 million losses included in non-controlling interests for 2022, represents the exchange loss attributable to non-controlling interests of €9.0 million, and the share of non-controlling interests in profit for the year, net of tax of €0.2 million.
Condensed consolidated statement of changes in equity (unaudited)
|
|
Attributable to owners of the parent |
|
|
||||||||
|
|
Share capital € million |
Share premium € million |
Group reorganisation reserve € million |
€ million |
Exchange equalisation reserve € million |
Other reserves € million |
Retained earnings € million |
Total € million |
Non-controlling interests € million |
Total equity € million |
|
|
Balance as at 1 January 2023 |
2,024.3 |
2,837.4 |
(6,472.1) |
(131.2) |
(1,218.2) |
292.5 |
5,949.6 |
3,282.3 |
103.3 |
3,385.6 |
|
|
Shares issued to employees exercising stock options (Note 11) |
6.0 |
8.2 |
- |
- |
- |
- |
- |
14.2 |
- |
14.2 |
|
|
Share-based compensation: |
|
|
|
|
|
|
|
|
|
|
|
|
Performance shares |
- |
- |
- |
- |
- |
20.4 |
- |
20.4 |
- |
20.4 |
|
|
Movement in shares held for equity compensation plan |
- |
- |
- |
- |
- |
0.2 |
- |
0.2 |
- |
0.2 |
|
|
Appropriation of reserves (Note 11) |
- |
- |
- |
29.7 |
- |
(25.0) |
(4.7) |
- |
- |
- |
|
|
Purchase of shares held by |
- |
- |
- |
- |
- |
- |
(9.9) |
(9.9) |
(2.7) |
(12.6) |
|
|
Acquisition of treasury shares (Note 11) |
- |
- |
- |
(42.6) |
- |
- |
- |
(42.6) |
- |
(42.6) |
|
|
Dividends (Note 13) |
- |
(289.9) |
- |
- |
- |
- |
2.7 |
(287.2) |
(0.3) |
(287.5) |
|
|
Transfer of cash flow hedge reserve, including cost of hedging to inventories, net of tax3 |
- |
- |
- |
- |
- |
(25.9) |
- |
(25.9) |
- |
(25.9) |
|
|
|
2,030.3 |
2,555.7 |
(6,472.1) |
(144.1) |
(1,218.2) |
262.2 |
5,937.7 |
2,951.5 |
100.3 |
3,051.8 |
|
|
Profit for the year, net of tax |
- |
- |
- |
- |
- |
- |
636.5 |
636.5 |
(0.8) |
635.7 |
|
|
Other comprehensive loss |
- |
- |
- |
- |
(490.7) |
9.9 |
(14.4) |
(495.2) |
(5.6) |
(500.8) |
|
|
Total comprehensive income |
- |
- |
- |
- |
(490.7) |
9.9 |
622.1 |
141.3 |
(6.4) |
134.9 |
|
|
Balance as at 31 December 2023 |
2,030.3 |
2,555.7 |
(6,472.1) |
(144.1) |
(1,708.9) |
272.1 |
6,559.8 |
3,092.8 |
93.9 |
3,186.7 |
|
3The amount included in other reserves of €25.9 million represents the cash flow hedge reserve, including cost of hedging, transferred to inventories of €30.8 million gain, and the deferred tax expense thereof amounting to €4.9 million.
4The amount included in the exchange equalisation reserve of €490.7 million loss for 2023 represents the exchange loss attributable to owners of the parent, primarily related to the Nigerian Naira, the Russian Rouble and the Egyptian Pound, including €11.7 million loss relating to the share of other comprehensive income of equity method investments.
The amount of other comprehensive income, net of tax included in other reserves of €9.9 million gain for 2023 consists of cash flow hedges gain of €12.6 million, valuation gain of €0.4 million on equity investments at fair value through other comprehensive income and the deferred tax expense thereof amounting to €3.1 million.
The amount of €622.1 million gain attributable to owners of the parent for 2023 comprises profit for the year, net of tax of €636.5 million, actuarial losses of €16.4 million and the deferred tax income thereof amounting to €2.0 million.
The amount of €6.4 million losses included in non-controlling interests for 2023, represents the exchange loss attributable to the non-controlling interests of €5.6 million, and the share of non-controlling interests in profit for the year, net of tax amounting to €0.8 million loss.
Condensed consolidated cash flow statement (unaudited)
|
|
|
Year ended 31 December |
||
|
|
Note |
2023 |
|
2022 |
|
€ million |
€ million |
|||
|
Operating activities |
|
|
|
|
|
Profit after tax for the year |
|
635.7 |
|
415.6 |
|
Finance costs, net |
5 |
48.3 |
|
82.7 |
|
Share of results of non-integral equity method investments |
|
(5.0) |
|
(2.5) |
|
Tax charged to the income statement |
|
274.6 |
|
208.0 |
|
Depreciation and impairment of property, plant and equipment, including right-of-use assets |
|
399.9 |
|
484.9 |
|
Employee performance shares |
|
20.4 |
|
16.5 |
|
Amortisation and impairment of intangible assets |
8 |
113.9 |
|
15.1 |
|
Impairment of equity method investments |
|
- |
|
52.8 |
|
Other non-cash items |
|
- |
|
70.5 |
|
|
|
1,487.8 |
|
1,343.6 |
|
Share of results of integral equity-method investments |
|
(9.7) |
|
(41.6) |
|
(Gain) / loss on disposals of non-current assets |
|
(1.3) |
|
1.5 |
|
Increase in inventories |
|
(142.6) |
|
(241.1) |
|
Increase in trade and other receivables |
|
(212.7) |
|
(104.7) |
|
Increase in trade and other payables |
|
491.0 |
|
472.6 |
|
Tax paid |
|
(225.8) |
|
(195.7) |
|
Net cash inflow from operating activities |
|
1,386.7 |
|
1,234.6 |
|
Investing activities |
|
|
|
|
|
Payments for purchases of property, plant and equipment |
|
(610.7) |
|
(523.4) |
|
Proceeds from sales of property, plant and equipment |
|
7.2 |
|
7.5 |
|
Payment for integral equity-method investment |
15 |
- |
|
(4.0) |
|
Receipts from integral equity-method investments |
15 |
6.7 |
|
9.7 |
|
Payments for non-integral equity method investments |
|
- |
|
(6.5) |
|
Receipts from non-integral equity-method investments |
15 |
7.0 |
|
1.8 |
|
Net proceeds from / (payments for) investments in financial assets at amortised cost |
|
473.5 |
|
(333.4) |
|
Net proceeds from investments in financial assets at fair value through profit or loss |
|
- |
|
142.6 |
|
Payments for investments in financial assets at fair value through other comprehensive income |
|
(5.9) |
|
- |
|
Payment for business combination, net of cash acquired |
14 |
(180.4) |
|
(399.2) |
|
Proceeds from settlement of derivatives relating to |
14 |
- |
|
13.0 |
|
Loans to related parties |
|
(4.7) |
|
(0.4) |
|
Repayments of loans by related parties |
|
0.5 |
|
2.0 |
|
Interest received |
|
38.0 |
|
7.2 |
|
Net cash outflow from investing activities |
|
(268.8) |
|
(1,083.1) |
|
Financing activities |
|
|
|
|
|
Proceeds from shares issued to employees, exercising stock options |
11 |
14.2 |
|
4.7 |
|
Purchase of shares held by non-controlling interests |
14 |
(12.6) |
|
(108.9) |
|
Acquisition of treasury shares |
11 |
(42.6) |
|
- |
|
Proceeds from borrowings |
|
136.4 |
|
650.0 |
|
Repayments of borrowings |
|
(89.7) |
|
(358.6) |
|
Principal repayments of lease obligations |
|
(59.1) |
|
(65.2) |
|
Proceeds from settlement of derivatives regarding financing activities |
|
4.6 |
|
0.1 |
|
Interest paid |
|
(76.2) |
|
(60.4) |
|
Dividends paid to owners of the parent |
|
(287.2) |
|
(260.2) |
|
Dividends paid to non-controlling interests |
|
(0.2) |
|
(0.2) |
|
Net cash outflow from financing activities |
|
(412.4) |
|
(198.7) |
|
Net increase / (decrease) in cash and cash equivalents |
|
705.5 |
|
(47.2) |
|
Movement in cash and cash equivalents |
|
|
|
|
|
Cash and cash equivalents at 1 January |
|
719.9 |
|
782.8 |
|
Net increase / (decrease) in cash and cash equivalents |
|
705.5 |
|
(47.2) |
|
Effect of changes in exchange rates |
|
(164.8) |
|
(15.7) |
|
Cash and cash equivalents at 31 December |
|
1,260.6 |
|
719.9 |
The accompanying notes form an integral part of these condensed consolidated financial statements
Selected explanatory notes to the condensed consolidated financial statements (unaudited)
1. Basis of preparation and accounting policies
Basis of preparation
These condensed consolidated financial statements are prepared in accordance with International Accounting Standard ('IAS') 34, 'Interim Financial Reporting', as adopted by the
Going concern
As part of the consideration of whether to adopt the going concern basis in preparing the condensed consolidated financial statements, management has considered the Group's financial performance in the year and overall financial position, as well as a quantitative viability exercise, including the performance of various stress tests that consider the Group's principal risks, including those relating to climate change, and confirms the Group's ability to generate cash in 12 months from the date of approval of the condensed consolidated financial statements and beyond. Management has also considered the geopolitical events involving
Accounting policies
The accounting policies used in the preparation of the condensed consolidated financial statements of
Amended and new standards adopted by the Group
The below standard and amendments to standards became applicable as of 1 January 2023 and were adopted by the Group. The adoption of these amendments and new standard did not have a material impact on the Group's condensed consolidated financial statements.
Amendments to IAS 1 and IFRS Practice Statement 2 - Disclosure of Accounting policies: These amendments provide guidance and examples to help entities apply materiality judgements to accounting policy disclosures. The amendments aim to help entities provide accounting policy disclosures that are more useful by replacing the requirement for entities to disclose their 'significant' accounting policies with a requirement to disclose their 'material' accounting policies and adding guidance on how entities apply the concept of materiality in making decisions about accounting policy disclosures.
Amendments to IAS 8 - Definition of Accounting Estimates: These amendments clarify the distinction between changes in accounting estimates and changes in accounting policies and the correction of errors. Also, they clarify how entities use measurement techniques and inputs to develop accounting estimates.
Amendment to IAS 12 - International tax reform - pillar two model rules: These amendments give companies temporary relief from recognising and disclosing deferred tax assets and liabilities related to Pillar Two income taxes. The amendments clarify that IAS 12 applies to income taxes arising from tax law enacted or substantively enacted to implement the Pillar Two Model Rules published by the Organization for Economic Cooperation and Development ('
Amendments to IAS 12 - Deferred Tax related to Assets and Liabilities arising from a Single Transaction: These amendments narrow the scope of the initial recognition exception, so that it no longer applies to transactions that give rise to equal taxable and deductible temporary differences such as leases and decommissioning liabilities.
IFRS 17 - Insurance Contracts: In May 2017, the IASB issued IFRS 17 'Insurance Contracts', a comprehensive new accounting standard for insurance contracts covering recognition and measurement, presentation and disclosure. IFRS 17 replaces IFRS 4 'Insurance Contracts' that was issued in 2005. IFRS 17 applies to all types of insurance contracts, regardless of the type of entities that issue them, as well as to certain guarantees and financial instruments with discretionary participation features, while a few scope exceptions apply. Targeted amendments made in July 2020 aimed to ease the implementation of the standard and deferred the application date of IFRS 17 to 1 January 2023, while further amendments made in December 2021 added a transition option that permits an entity to apply an optional classification overlay in the comparative period(s) presented on initial application of IFRS 17.
2. Foreign currency and translation
The Group's reporting currency is the Euro (€).
|
|
Average rate for the year ended |
Closing rate as at |
||
|
|
31 December 2023 |
31 December 2022 |
31 December 2023 |
31 December 2022 |
|
US Dollar |
1.08 |
1.05 |
1.11 |
1.06 |
|
|
0.87 |
0.85 |
0.87 |
0.88 |
|
Polish Zloty |
4.54 |
4.68 |
4.32 |
4.69 |
|
Nigerian Naira |
695.06 |
448.99 |
1,056.96 |
493.61 |
|
Hungarian Forint |
381.75 |
390.36 |
382.03 |
401.54 |
|
Swiss Franc |
0.97 |
1.01 |
0.94 |
0.99 |
|
Russian Rouble |
92.40 |
74.01 |
101.68 |
79.23 |
|
Romanian Leu |
4.95 |
4.93 |
4.98 |
4.94 |
|
Ukrainian Hryvnia |
39.54 |
33.92 |
41.63 |
38.94 |
|
Czech Koruna |
24.00 |
24.56 |
24.69 |
24.21 |
|
Serbian Dinar |
117.25 |
117.47 |
117.16 |
117.30 |
|
Egyptian Pound |
33.15 |
20.09 |
34.16 |
26.35 |
In mid-June 2023, the Nigerian Central Bank stopped intervening heavily in the interbank foreign exchange market, allowing the Nigerian Naira to float more freely. The Group monitors the situation in
3. Segmental analysis
The Group has essentially one business, being the production, sale and distribution of ready-to-drink, primarily non-alcoholic, beverages across 29 countries. The Group's markets are aggregated in reportable segments as follows:
|
Established markets: |
|
|
Developing markets: |
|
|
Emerging markets: |
|
*The Global exports market refers to the export business for
a) Volume and net sales revenue
The Group sales volume in million unit cases5 for the six months and the years ended 31 December was as follows:
|
|
Six months ended 31 December |
Year ended 31 December |
|
||
|
|
2023 |
2022 |
2023 |
2022 |
|
|
Established |
322.3 |
338.2 |
628.7 |
643.9 |
|
|
Developing |
243.7 |
248.4 |
471.0 |
478.8 |
|
|
Emerging |
886.4 |
795.0 |
1,735.8 |
1,589.1 |
|
|
Total volume |
1,452.4 |
1,381.6 |
2,835.5 |
2,711.8 |
|
5 One unit case corresponds to approximately 5.678 litres or 24 servings, being a typically used measure of volume. For Premium Spirits volume, one unit case also corresponds to 5.678 litres. For biscuits volume, one unit case corresponds to 1 kilogram. For coffee volume, one unit case corresponds to 0.5 kilograms or 5.678 litres. Volume data is derived from unaudited operational data.
Net sales revenue per reportable segment for the six months and the years ended 31 December is presented below:
|
|
Six months ended 31 December |
Year ended 31 December |
||
|
|
2023 |
2022 |
2023 |
2022 |
|
|
€ million |
€ million |
€ million |
€ million |
|
Established |
1,730.5 |
1,589.9 |
3,358.5 |
2,974.1 |
|
Developing |
1,103.4 |
928.1 |
2,088.6 |
1,719.7 |
|
Emerging |
2,328.6 |
2,470.5 |
4,736.9 |
4,504.6 |
|
Total net sales revenue |
5,162.5 |
4,988.5 |
10,184.0 |
9,198.4 |
In addition to non-alcoholic, ready-to-drink beverages as well as coffee and snacks ("NARTD"), the Group sells and distributes Premium Spirits. An analysis of volume and net sales revenue per product type for the six months and the years ended 31 December is presented below:
|
|
Six months ended 31 December |
Year ended 31 December |
||
|
|
2023 |
2022 |
2023 |
2022 |
|
|
€ million |
€ million |
€ million |
€ million |
|
Volume (in million unit cases) |
|
|
|
|
|
NARTD |
1,449.8 |
1,379.6 |
2,831.2 |
2,708.4 |
|
Premium spirits |
2.6 |
2.0 |
4.3 |
3.4 |
|
Total volume |
1,452.4 |
1,381.6 |
2,835.5 |
2,711.8 |
|
Net sales revenue (€ million) |
|
|
|
|
|
NARTD |
4,992.6 |
4,846.4 |
9,886.1 |
8,956.0 |
|
Premium spirits |
169.9 |
142.1 |
297.9 |
242.4 |
|
Total net sales revenue |
5,162.5 |
4,988.5 |
10,184.0 |
9,198.4 |
b) Other income statement items
|
|
Six months ended 31 December |
Year ended 31 December |
||
|
|
2023 |
2022 |
2023 |
2022 |
|
|
€ million |
€ million |
€ million |
€ million |
|
Operating profit |
|
|
|
|
|
Established |
208.4 |
163.0 |
379.2 |
310.4 |
|
Developing |
85.4 |
56.2 |
152.6 |
113.1 |
|
Emerging |
102.5 |
208.9 |
421.8 |
280.3 |
|
Total operating profit |
396.3 |
428.1 |
953.6 |
703.8 |
|
Reconciling items |
|
|
|
|
|
Finance costs, net |
(16.9) |
(40.0) |
(48.3) |
(82.7) |
|
Tax |
(132.1) |
(126.0) |
(274.6) |
(208.0) |
|
Share of results of non-integral equity method investments |
3.3 |
1.1 |
5.0 |
2.5 |
|
Non-controlling interests |
0.2 |
(0.7) |
0.8 |
(0.2) |
|
Profit after tax attributable to owners of the parent |
250.8 |
262.5 |
636.5 |
415.4 |
c) Other items
We disclosed in our 2022 Integrated Annual Report that exceptional items related to
4. Restructuring costs
As part of the effort to optimise its cost base and sustain competitiveness in the marketplace, the Group undertakes restructuring initiatives. Restructuring mainly concerns employees' termination benefits, which are included within operating expenses. Restructuring costs per reportable segment for the six months and years ended 31 December are presented below:
|
|
Six months ended 31 December |
Year ended 31 December |
||
|
|
2023 |
2022 |
2023 |
2022 |
|
|
€ million |
€ million |
€ million |
€ million |
|
Established |
0.9 |
(1.1) |
0.9 |
(6.1) |
|
Developing |
1.1 |
(1.5) |
1.1 |
(1.5) |
|
Emerging |
5.2 |
8.5 |
7.0 |
19.5 |
|
Total restructuring costs |
7.2 |
5.9 |
9.0 |
11.9 |
5. Finance costs, net
|
|
Six months ended 31 December |
Year ended 31 December |
||
|
|
2023 |
2022 |
2023 |
2022 |
|
|
€ million |
€ million |
€ million |
€ million |
|
Finance income |
(35.7) |
(9.3) |
(55.7) |
(13.2) |
|
Finance costs |
45.3 |
38.9 |
88.1 |
79.9 |
|
Net foreign exchange losses |
7.3 |
10.4 |
15.9 |
16.0 |
|
Finance costs, net |
16.9 |
40.0 |
48.3 |
82.7 |
6. Tax
|
|
Six months ended 31 December |
Year ended 31 December |
||
|
|
2023 |
2022 |
2023 |
2022 |
|
|
€ million |
€ million |
€ million |
€ million |
|
Profit before tax |
382.7 |
389.2 |
910.3 |
623.6 |
|
Tax |
(132.1) |
(126.0) |
(274.6) |
(208.0) |
|
Effective tax rate |
34.5% |
32.4% |
30.2% |
33.4% |
The Group's effective tax rate for 2023 may differ from the theoretical amount that would arise using the weighted average tax rate applicable to profits of the consolidated entities. This difference can be a consequence of a number of factors, the most significant of which are the application of statutory tax rates of the countries in which the Group operates, the non-deductibility of certain expenses, the non-taxable income and one-off tax items.
7. Earnings per share
Basic earnings per share is calculated by dividing the net profit attributable to the owners of the parent by the weighted average number of shares outstanding during the period (full year of 2023: 367,824,641; full year of 2022: 366,351,704; six months ended 31 December 2023: 368,133,839; six months ended 31 December 2022: 366,539,951). Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive ordinary shares arising from exercising employee stock options.
8. Intangible assets and property, plant and equipment
|
|
Intangible |
Property, plant |
|
|
|
assets |
and equipment |
|
|
|
€ million |
€ million |
|
|
Net book value as at 1 January 2023 excluding right-of-use assets |
2,542.5 |
3,062.4 |
|
|
Additions |
- |
610.2 |
|
|
Arising from business combinations (Note 14) |
204.4 |
- |
|
|
Reclassified to assets held for sale |
- |
(3.3) |
|
|
Assets held for sale classified back to property, plant and equipment |
- |
0.1 |
|
|
Disposals |
- |
(8.3) |
|
|
Depreciation, impairment and amortisation |
(113.9) |
(340.8) |
|
|
Foreign currency translation |
(64.4) |
(472.8) |
|
|
Net book value as at 31 December 2023 excluding right-of-use assets |
2,568.6 |
2,847.5 |
|
|
Net book value as at 1 January 2023 of right-of-use assets (Note 12) |
|
203.9 |
|
|
Net book value as at 31 December 2023 of right-of-use assets (Note 12) |
|
209.6 |
|
|
Net book value as at 31 December 2023 |
|
3,057.1 |
|
Right-of-use assets arising from business combinations in 2023 amounted to €6.7 million (2022: €40.1 million).
Impairment losses recognised in connection with intangible assets amounted to €112.5 million in 2023 as detailed below (2022: €13.7 million, in connection with the Group's Russian cash-generating unit).
Impairment of Egyptian cash-generating unit
We disclosed in our 2022 integrated annual report that in the cash-generating unit ('unit') of
The Group performed its annual impairment test in 2023, which resulted in an impairment loss for its Egyptian unit of €109.4 million, as the recoverable amount was lower than the carrying amount of the unit. The recoverable amount was determined based on value-in-use calculations consistent with those performed in 2022, updated to consider management's best estimates of expected cash flows and a higher discount rate, reflective of the increased macroeconomic uncertainty in
The following table sets out the key assumptions used in the impairment assessment of the Egyptian unit:
|
|
December 2023 |
December 2022 |
|
Growth rate in perpetuity |
5.0% |
5.0% |
|
Post-tax discount rate |
17.4% |
15.2% |
|
Pre-tax discount rate |
20.8% |
17.8% |
As at 31 December 2023, the recoverable amount of the Egyptian unit was approximately €340 million. The Group continues to closely monitor its Egyptian unit in order to ensure that timely actions and initiatives are undertaken to minimise potential adverse impacts on its expected performance.
Impairment of Costa Express Business
In 2023, the Group recognised an impairment loss of €3.1 million in connection with its self-serve coffee vending business in
9. Financial risk management and financial instruments
The Group's activities expose it to a variety of financial risks: market risk (including currency risk, interest rate risk and commodity price risk), credit risk, liquidity risk and capital risk. There have been no material changes in the risk management policies since the previous year end.
As described in the 2022 Integrated Annual Report, the Group actively manages its liquidity risk. The Group maintains its healthy liquidity position and is able to meet its liabilities as they fall due. As at 31 December 2023, the Group has net debt of €1.6 billion (Note 10). In addition, as at 31 December 2023, the Group has cash and cash equivalents and other financial assets of €1.8 billion, an undrawn Revolving Credit Facility of €0.8 billion, an uncommitted Money Market Loan agreement of €0.2 billion, as well as €0.8 billion available out of the €1.0 billion Commercial Paper Programme. None of our debt facilities are subject to any financial covenants that would impact the Group's liquidity or access to capital. The Group's
The Group's financial instruments recorded at fair value are included in Level 1, Level 2 and Level 3 within the fair value hierarchy as described in the 2022 Integrated Annual Report.
The fair value of bonds and notes payable applying the clean market price, as at 31 December 2023, was €2,717.4 million compared to their book value of €2,887.3 million, as at the same date. The money market funds recorded at fair value are included in Level 1 within the fair value hierarchy. As at 31 December 2023, the fair value of the money market funds amounted to €513.8 million (€497.2 million as at 31 December 2022).
As at 31 December 2023, the total derivatives included in Level 2 were financial assets of €18.6 million and financial liabilities of €36.8 million. The Group recognises embedded derivatives whose risks and economic characteristics were not considered to be closely related to the commodity contract in which they were embedded. The valuation techniques used to determine their fair value maximised the use of observable market data. The fair value of the embedded derivatives as at 31 December 2023 amounted to a financial liability of €9.1 million and are classified within Level 2.
The Group uses derivatives to mitigate the commodity price risk related to plastics. As the valuation of these derivatives uses prices that are not observable in the market, it is classified within Level 3. The fair value of the derivatives related to plastics as at 31 December 2023 amounted to a financial liability of €1.2 million.
The Group uses foreign currency derivatives to mitigate the currency risk related to Nigerian Naira. As the valuation technique of these derivatives incorporates greater use of unobservable inputs, their fair value is classified within Level 3. The fair value of these derivatives as at 31 December 2023 were financial assets of €82.9 million and financial liabilities of €35.0 million.
There were no transfers between Levels 1, 2 and 3 during the year ended 31 December 2023.
10. Net debt
|
|
As at 31 December |
||
|
|
2023 |
|
2022 |
|
|
€ million |
|
€ million |
|
Current borrowings |
948.1 |
|
337.0 |
|
Non-current borrowings |
2,476.4 |
|
3,082.9 |
|
Less: Cash and cash equivalents |
(1,260.6) |
|
(719.9) |
|
- Financial assets at amortised cost |
(54.8) |
|
(529.5) |
|
- Financial assets at fair value through profit or loss |
(513.8) |
|
(497.2) |
|
Less: Other financial assets |
(568.6) |
|
(1,026.7) |
|
Net debt |
1,595.3 |
|
1,673.3 |
In September 2022 the Group completed the issue of a €500 million Euro-denominated fixed rate Green bond maturing in September 2025 with a coupon rate of 2.75%.
In December 2019 the Group established a loan facility of US Dollar 85.0 million to finance the purchase of production equipment by the Group's subsidiary in
Cash and cash equivalents include an amount of €92.5 million (€120.9 million as at 31 December 2022) equivalent in Nigerian Naira. This includes an amount of €nil (€10.6 million as at 31 December 2022) equivalent in Nigerian Naira, which related to the outstanding balance held for the repayment of
As a result of sanctions and other regulations, there have been changes in required regulatory approvals, potentially impacting the transfer and usage of cash outside of
The financial assets at amortised cost comprise of time deposits amounting to €54.8 million (31 December 2022: €529.5 million) The financial assets at fair value through profit or loss are related to money market funds. Included in 'Other financial assets' of the condensed consolidated balance sheet are derivative financial instruments of €97.5 million (31 December 2022: €35.3 million) and related party loans receivable of €1.8 million (31 December 2022: €1.8 million).
11. Share capital, share premium and treasury shares
|
|
Number of shares |
Share |
Share |
|
|
(authorised |
capital |
premium |
|
|
and issued) |
€ million |
€ million |
|
Balance as at 1 January 2022 |
371,795,418 |
2,022.3 |
3,097.3 |
|
Shares issued to employees exercising |
|
|
|
|
stock options |
290,677 |
2.0 |
2.7 |
|
Dividends (Note 13) |
- |
- |
(262.6) |
|
Balance as at 31 December 2022 |
372,086,095 |
2,024.3 |
2,837.4 |
|
Shares issued to employees exercising |
|
|
|
|
stock options |
891,127 |
6.0 |
8.2 |
|
Dividends (Note 13) |
- |
- |
(289.9) |
|
Balance as at 31 December 2023 |
372,977,222 |
2,030.3 |
2,555.7 |
In 2023, the share capital of
An amount of €29.7 million in 2023 (2022: €15.4 million) relates to treasury shares provided to employees in connection with vested performance share awards under the Company's employee incentive scheme, which was reflected as an appropriation of reserves between '
Following the above changes, on 31 December 2023 the share capital of the Group amounted to €2,030.3 million and comprised 372,977,222 shares with a nominal value of CHF 6.70 each.
On 20 November 2023, the Group announced the launch of a share buyback programme of up to a maximum of 18,000,000 ordinary shares to be purchased in a manner consistent with the Company's general authority to repurchase shares granted at its annual general meeting on 17 May 2023 and any such authority granted at its following annual general meetings. The programme commenced on 21 November 2023 and is expected to run for a period of around two years. As at 31 December 2023, the Group had purchased shares under the programme for a total consideration of €42.6 million, which was reflected in line 'Acquisition of treasury shares' of the consolidated cash flow statement and the consolidated statement of changes in equity.
12. Leases
The leases which are recorded on the condensed consolidated balance sheet are principally in respect of vehicles and buildings. The Group's right-of-use assets and lease liability are presented below:
|
|
2023 |
2022 |
|
|
€ million |
€ million |
|
Land and buildings |
105.2 |
82.7 |
|
Plant and equipment |
104.4 |
121.2 |
|
Total right-of-use assets |
209.6 |
203.9 |
|
|
|
|
|
Current lease liabilities |
55.3 |
53.9 |
|
Non-current lease liabilities |
154.8 |
152.1 |
|
Total lease liability |
210.1 |
206.0 |
13. Dividends
On 21 June 2022, the shareholders of
The shareholders of
The Board of Directors will propose a 0.93 euro dividend per share in respect of 2023. If approved by the shareholders of
14. Business combinations and acquisition of non-controlling interests
Acquisition of
On 1 November 2023, the Group acquired 100% of the issued shares of
The fair value of the consideration for the
Details of the acquisition with regards to the provisionally determined fair values of the net assets acquired and goodwill are presented in the table below. The net assets acquired reflect the additional payment at the provisional amount of US Dollar 0.6 million (€0.5 million).
|
|
|
Fair value € million |
||
|
Trademarks |
|
197.0 |
||
|
Property, plant and equipment |
|
6.7 |
||
|
Inventories |
|
4.9 |
||
|
Trade, other receivables and assets |
|
9.1 |
||
|
Cash and cash equivalents |
|
3.5 |
||
|
Borrowings |
|
(6.5) |
||
|
Trade and other payables |
|
(9.7) |
||
|
Net deferred tax liability |
|
(28.0) |
||
|
Net identifiable assets acquired |
|
177.0 |
||
|
Add: |
|
7.4 |
||
|
Net assets acquired |
|
184.4 |
||
Fair values on acquisition are provisional and will be finalised within 12 months of the acquisition date.
The goodwill arising is attributable to the brand's growth potential across the Group's markets. Acquisition-related costs of €5.6 million were included in the 2023 operating expenses, as a result of the above acquisition.
The fair value of trade, other receivables and assets acquired includes trade receivables with a fair value of €2.0 million, while there was no significant amount of trade receivables acquired considered to be uncollectible.
Net sales revenue and profit after tax contributed by BFF to the Group for the period from 1 November 2023 to 31 December 2023, amounted to €9.5 million and €2.8 million respectively. If the business combination had occurred on 1 January 2023, consolidated net sales revenue and profit after tax for the year ended 31 December 2023 would have been higher by approximately €43.5 million and €7.4 million respectively. This pro forma information reflects the pre-acquisition operating model of BFF and is not adjusted for the benefits arising from the post-acquisition transfer of distribution from Brown-Forman or third-party distributors to CCH operations in the CCH markets and therefore should not be considered as indicative of Finlandia Vodka brand future performance.
Other acquisition costs
During 2023, the Group incurred acquisition costs of €0.7 million in connection with acquisition expected to be completed in 2024, which were included in line 'Operating expenses' of the condensed consolidated income statement.
Acquisition of Three Cents
On 21 October 2022, the Group acquired 100% of the issued shares of ESM Effervescent Sodas Management Limited established in
Details of the acquisition with regards to the determined fair values of the net assets acquired and goodwill are presented in the table below:
|
|
|
|
Fair Value |
||
|
|
|
€ million |
|||
|
Trademarks |
|
|
22.6 |
||
|
Property, plant and equipment |
|
|
0.2 |
||
|
Trade, other receivables and assets |
|
|
1.9 |
||
|
Cash and cash equivalents |
|
|
1.9 |
||
|
Borrowings |
|
|
(0.1) |
||
|
Trade and other payables |
|
|
(1.9) |
||
|
Net deferred tax liabilities |
|
|
(2.7) |
||
|
Net identifiable assets acquired |
|
|
21.9 |
||
|
Add: |
|
|
24.0 |
||
|
Net assets acquired |
|
|
45.9 |
||
No changes to net identifiable assets acquired have been identified compared to the relevant amounts disclosed as part of the Group's 2022 integrated annual report.
Details of the acquisition were disclosed in Note 24 of the Group's 2022 Integrated Annual Report.
Multon A.O. group of companies ('Multon')
The Group holds a 50% interest in Multon, which is engaged in the production and distribution of juices in
Details of the change in control of Multon were disclosed in Note 24 of the Group's 2022 Integrated Annual Report. The cash and cash equivalents acquired amounting to €24.2 million was presented in line 'Payment for business combinations, net of cash acquired' in the condensed consolidated cash flow statement.
Acquisition of Coca-Cola Bottling Company of Egypt S.A.E.6
On 12 August 2021, the Group entered into a sale and purchase agreement to acquire approximately 52.7% of Coca-Cola Bottling Company of Egypt S.A.E. ('CCBCE'), the bottling partner of TCCC in
The fair value of the consideration for the MBL acquisition presented in line 'Payment for business combinations, net of cash acquired' of the condensed consolidated cash flow statement consisted of US Dollar 303.7 million (€264.9 million), which was transferred on acquisition, and an additional payment of US Dollar 124.0 million (€119.1 million), based on CCBCE's past performance, net financial position and working capital movement, which was transferred in October 2022, while cash and cash equivalents acquired amounted to €15.9 million. Foreign exchange loss arising on settlement of the consideration payable for the MBL acquisition amounted to €11.3 million and was also presented in line 'Payment for business combinations, net of cash acquired' of the condensed consolidated cash flow statement, while proceeds from settlement of derivatives used to hedge the relevant foreign currency risk amounted to €13.0 million and were presented in line 'Proceeds from settlement of derivatives relating to business combination' of the condensed consolidated cash flow statement.
On 12 August 2021, the Group entered into an additional sale and purchase agreement to acquire approximately 42% of CCBCE, from a wholly-owned affiliate of TCCC ('TCCC acquisition') for a consideration of US Dollar 122.7 million (€108.9 million). The TCCC acquisition was completed on 25 January 2022, it was treated as separate to the MBL acquisition and was accordingly accounted for as an equity transaction.
Details of the above transactions were disclosed in Note 24 of the Group's 2022 Integrated Annual Report. Following the completion of both transactions, the Group held a 94.7% interest in CCBCE as at 31 December 2022.
During 2023, the Group acquired approximately 3.1% additional interest in CCBCE for a consideration of €12.6 million, which was presented in line 'Purchases of shares held by non-controlling interests' of the condensed consolidated cash flow statement. Following this, the Group held a 97.8% interest in CCBCE as at 31 December 2023.
6Effective 18 June 2023, Coca-Cola Bottling Company of Egypt S.A.E. was renamed to Coca-Cola HBC Egypt.
15. Related party transactions
a) The Coca-Cola Company
As at 31 December 2023, TCCC indirectly owned 21.0% (31 December 2022: 21.0%) of the issued share capital of
|
|
Six months ended 31 December |
Year ended 31 December |
||
|
|
2023 |
2022 |
2023 |
2022 |
|
|
€ million |
€ million |
€ million |
€ million |
|
Purchases of concentrate, finished products |
|
|
|
|
|
and other items |
882.9 |
845.5 |
1,861.4 |
1,808.7 |
|
Net contributions received for marketing and |
|
|
|
|
|
promotional incentives |
67.8 |
56.0 |
125.1 |
108.6 |
|
Sales of finished goods and raw materials |
2.1 |
2.2 |
4.7 |
4.2 |
|
Other income |
2.2 |
6.6 |
4.1 |
8.6 |
|
Other expenses |
1.8 |
2.5 |
3.6 |
4.7 |
|
|
|
|
|
|
As at 31 December 2023, the Group was owed €42.8 million (€45.3 million as at 31 December 2022) by TCCC and owed €273.4 million (€226.9 million as at 31 December 2022) to TCCC.
Refer to Note 24 of the Group's 2022 Integrated Annual Report for payments to TCCC during 2022 regarding purchase of convertible loan and acquisition of non-controlling interests in the context of the acquisition of Coca-Cola Bottling Company of Egypt S.A.E.
b) Frigoglass S.A. ('Frigoglass'),
As at 31 December 2022,
|
|
|
|
|
|
Four months ended |
Year ended 31 December 2022 |
|
|
€ million |
€ million |
|
Purchases of coolers and other equipment, raw and other materials |
24.4 |
112.3 |
|
Maintenance, rent and other expenses |
10.0 |
33.1 |
|
|
|
|
7 Transactions and balances with
During 2022, the Group received dividends of €1.2 million from
Transactions and balances with AG Leventis (
|
|
Six months ended 31 December |
Year ended 31 December |
||
|
|
2023 |
2022 |
2023 |
2022 |
|
|
€ million |
€ million |
€ million |
€ million |
|
Purchases of finished goods and other items |
― |
1.7 |
― |
3.6 |
|
Other expenses |
3.9 |
0.1 |
11.0 |
0.1 |
As at 31 December 2023, the Group owed €1.1 million (2022: €2.7 million) and had a lease liability of €1.2 million (2022: €4.2 million) to AG Leventis (
c) Other related parties
During the six months and full year ended 31 December 2023, the Group incurred other expenses of €5.6 million and €15.5 million (€7.9 million and €15.5 million in the respective prior-year periods) mainly related to maintenance services for cold drink equipment and installations of coolers, fountains, vending and merchandising equipment as well as subsequent expenditure for fixed assets of €1.7 million and €3.2 million (€1.8 million and €3.0 million in the respective prior-year periods) from other related parties. In addition, during the six months and year ended 31 December 2023, the Group purchased coolers and other equipment, as well as inventory of €18.7 million and €44.1 million (€4.2 million and €5.5 million in the respective prior year periods) from other related parties.
We disclosed in our 2022 Integrated Annual Report that
During the six months and the year ended 31 December 2023, the Group received dividends of €nil and €7.0 million from other related parties (€nil and €0.6 million in the respective prior-year periods), which are included in line `Receipts from non-integral equity method investments' of the condensed consolidated cash flow statement and paid €nil in the six months and year ended 31 December 2023 in connection with capital increase of other related parties (€nil and €5.7 million in the respective prior-year periods, which was included in line 'Payments for non-integral equity method investments' of the condensed consolidated cash flow statement). Furthermore, during the six months and the year ended 31 December 2023, €nil regarding loans receivable from other related parties was converted to equity (€nil and €1.3 million in the respective prior-year periods).
As at 31 December 2023, the Group owed €9.1 million (€3.7 million as at 31 December 2022) to and was owed €6.7 million including loans receivable of €4.3 million (€1.5 million dividends receivable as at 31 December 2022) from other related parties.
Capital commitments to other related parties amounted to €3.8 million as at 31 December 2023 (€4.5 million as at 31 December 2022).
d) Joint ventures
The below table summarises transactions with joint ventures:
|
|
Six months ended 31 December |
Year ended 31 December |
||
|
|
2023 |
2022 |
2023 |
2022 |
|
|
€ million |
€ million |
€ million |
€ million |
|
Purchases of inventory |
14.4 |
19.5 |
26.0 |
26.0 |
|
Sales of finished goods and raw materials |
4.0 |
3.0 |
7.8 |
9.2 |
|
Other income |
4.8 |
8.3 |
10.4 |
15.8 |
|
Other expenses |
4.0 |
5.4 |
8.3 |
15.7 |
As at 31 December 2023, the Group owed €8.6 million including loans payable of €2.7 million (€4.4 million as at 31 December 2022 including loans payable of €nil) to and was owed €12.3 million including dividends and loans receivable of €2.6 million and €4.3 million respectively (€9.6 million as at 31 December 2022 including dividends and loans receivable of €nil and €4.3 million respectively) from joint ventures. During the six months and year ended 31 December 2023, the Group received dividends of €5.2 million and €6.7 million from integral joint ventures (€7.7 million and €9.7 million in the respective prior-year periods), which were included in line `Receipts from integral equity method investments' of the condensed consolidated cash flow statement. Furthermore, during the six months and year ended 31 December 2023, the Group paid €nil in connection with capital increase of joint ventures (€4.0 million in the respective prior-year periods, which was included in line 'Payments for integral equity method investments' of the condensed consolidated cash flow statement).
e) Directors
Evguenia Stoichkova and George Leventis have been elected to the Board of
16. Contingencies
In relation to the Greek Competition Authority's decision of 25 January 2002, one of
With respect to the investigation of the Greek Competition Commission initiated on 6 September 2016, regarding
In 1992, our subsidiary
The tax filings of the Group and its subsidiaries are routinely subjected to audit by tax authorities in most of the jurisdictions in which the Group conducts business. These audits may result in assessments of additional taxes. The Group provides for additional tax in relation to the outcome of such tax assessments, to the extent that a liability is probable and estimable.
The Group is also involved in various other legal proceedings. Management believes that any liability to the Group that may arise as a result of these pending legal proceedings will not have a material adverse effect on the results of operations, cash flows, or the financial position of the Group taken as a whole.
Considering the above, there have been no significant adverse changes in contingencies since 31 December 2022 (as described in our 2022 Integrated Annual Report available on the
17. Commitments
As at 31 December 2023 the Group had capital commitments including commitments for leases and the share of its joint ventures' capital commitments amounting to €203.4 million (31 December 2022: €210.5 million), which mainly relate to plant and machinery equipment.
18. Number of employees
The average number of full-time equivalent employees in 2023 was 32,747 (2022: 33,043).
19. Subsequent events
In late January 2024, the Nigerian Naira depreciated against the US Dollar by approximately 33% compared to the December 2023 respective rate. The Group has assessed the impact to 2024 operating profit of the devaluation resulting from its operations in Nigeria and considering mitigation actions available, does not expect that this will be material. This is captured within the 2024 outlook. We are continuously monitoring the situation to ensure that timely actions are undertaken as planned to minimise the adverse impact from the currency devaluation to the Group's business in Nigeria.
|
Volume by market for 2023 and 2022 |
|
|
|||
|
|
|
|
% Change |
||
|
Unit cases (million)8 |
2023 |
2022 |
2023 vs 2022 |
||
|
|
|
|
|
||
|
Established Markets |
|
|
|
||
|
Austria |
83.2 |
86.4 |
-4% |
||
|
Cyprus |
16.6 |
15.9 |
4% |
||
|
Greece |
120.7 |
112.8 |
7% |
||
|
Italy |
253.5 |
277.4 |
-9% |
||
|
Republic of Ireland and Northern Ireland |
85.1 |
83.0 |
3% |
||
|
Switzerland |
69.5 |
68.4 |
2% |
||
|
Global exports* |
0.1 |
- |
NM |
||
|
Total |
628.7 |
643.9 |
-2% |
||
|
|
|
|
|
||
|
Developing Markets |
|
|
|
||
|
Baltics |
38.1 |
37.0 |
3% |
||
|
Croatia |
32.7 |
31.9 |
3% |
||
|
Czech Republic |
52.6 |
60.2 |
-13% |
||
|
Hungary |
97.3 |
102.7 |
-5% |
||
|
Poland |
216.6 |
213.4 |
1% |
||
|
Slovakia |
24.5 |
24.5 |
- |
||
|
Slovenia |
9.2 |
9.1 |
1% |
||
|
Total |
471.0 |
478.8 |
-2% |
||
|
|
|
|
|
||
|
Emerging Markets |
|
|
|
||
|
Armenia |
15.5 |
15.5 |
- |
||
|
Belarus |
50.7 |
43.7 |
16% |
||
|
Bosnia and Herzegovina |
24.5 |
23.6 |
4% |
||
|
Bulgaria |
72.5 |
68.5 |
6% |
||
|
Moldova |
8.8 |
9.0 |
-2% |
||
|
Nigeria |
415.5 |
408.3 |
2% |
||
|
Romania |
186.8 |
203.7 |
-8% |
||
|
Russian Federation |
368.7 |
266.1 |
39% |
||
|
Serbia (including the Republic of Kosovo) |
165.7 |
162.1 |
2% |
||
|
Ukraine |
119.3 |
101.2 |
18% |
||
|
Egypt |
307.8 |
287.4 |
7% |
||
|
Total |
1,735.8 |
1,589.1 |
9% |
||
|
|
|
|
|
||
|
Total Coca-Cola HBC |
2,835.5 |
2,711.8 |
5% |
||
8One unit case corresponds to approximately 5.678 litres or 24 servings, being a typically used measure of volume. For Premium Spirits volume, one unit case also corresponds to 5.678 litres. For biscuits volume, one unit case corresponds to 1 kilogram. For coffee, one unit case corresponds to 0.5 kilograms or 5.678 litres. Volume data is derived from unaudited operational data.
*Global exports market refers to the export business for Finlandia Vodka and Three Cents for the period November-December 2023.
- Our joint venture with Heineken in North Macedonia generated volume of 27.7 million unit cases in 2023 (2022: 26.5 million unit cases), increased by 5% compared to the prior year.
- Multon, our Russian juice business, generated volume of 36.7 million unit cases in 2022, prior to the change in control effected 11 August 2022 (Note 14), which is not included in the performance of the Russian Federation for 2022.
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