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Coca-Cola Enterprises Posts 2Q Loss |
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Thursday, 17 July 2008 |
ATLANTA: Coca-Cola Enterprises said Thursday that it lost $3.17 billion in the second quarter and that after Labor Day, it will raise prices in the U.S., where soda sales have declined.
The Atlanta-based Coke bottler says it lost $6.52 per share, compared with profit of $270 million, or 56 cents per share, in the year-ago quarter.
The company says the loss included a $5.3 billion charge to lower the value of a franchise license in North America due to an expected decline in operating income, higher commodity prices and its falling share price. Excluding the one-time charge, which lowered per-share profit by $7.06, the company said earnings per share were 56 cents in the quarter.
Analysts polled by Thomson Financial expected profit of 53 cents per share on revenue of about $6 billion, on average.
Coca-Cola Enterprises Inc.'s revenue rose 5 percent to $5.94 billion from $5.67 billion a year earlier.
The company's results were helped by favorable tax and currency exchange rates as well as modest growth in Europe, but U.S. sales and operating income both fell.
Chief Executive John Brock said in a statement that to deal with higher commodity costs and declining U.S. soda sales, the company will raise U.S. prices after Labor Day.
Brock also said it would review its supply chain, operations and price strategy as well as "put into motion the essential changes required" to improve its performance in the U.S.
"This work requires continued cooperation with The Coca-Cola Co. as we work together to improve the long-term outlook for our North American business over the coming months," he said in the statement.
Analysts have said that if its bottler raises prices, Coca-Cola Co. may want to raise its own prices.
Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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