Coca-Cola Phils posts 28% profit hike in H1

Coca-Cola Bottlers Philippines Inc. (CCBPI), a subsidary of food and beverage giant San Miguel Corp., reported a 28-percent growth in its net income for the first half this year to P942 million, a company statement said yesterday.

Revenues reached P14.2 billion while operating income amounted to P1.12 billion, slightly above the previous year’s level, mainly due to fixed-cost savings and favorable sales mix, as well as pricing gains.

Fixed costs have been reduced by more than P400 million, CCBPI said.

CCBPI is implementing a going-to-market (GTM) program wherein it is rapidly reconfiguring selling territories and putting new dealers in place.

Sales growth and margin improvement across all its territories are likewise expected from new and customized measures to address local competition and consumer preferences.

In 2003, CCBPI’s sales volume was four percent below the 2002 level while sales revenue of P29.1 billion was three percent lower than 2002. Operating income declined 36 percent to P1.38 billion because of higher discounts offered to dealers in support the GTM strategy.

CCBPI provided supplemental discounts to assist new dealers in acquiring larger warehouse space to accommodate bigger volume requirements.

The Coca-Cola Beverage Group registered net revenues of P41.3 billion, up by 17 percent from the previous level. However, operating income was slightly below previous year at P2.52 billion as the group continues to build on and put in place the GTM program.

Meanwhile, Cosmos Bottling Corp. continues to be regarded as the Philippines’ most preferred low-priced cola manufacturer as sales revenue increased 10 percent to P9.91 billion with sales volume rising seven percent.

Cosmos expects to post double-digit volume growth in 2004 as the company widens its geographic scope while leveraging on CBCPI’s manufacturing strength and distribution reach.

While CCBPI introduced several new products in 2003 to excite the market – among them Vanilla Coke, Cherry Coke and other flavors of the Royal softdrinks brand – more product innovations such as energy drinks and sparkling juices are expected in 2004.