What’s Behind Coca-Cola Amatil’s 2018 Surge?
This year has seen a big improvement in Coca-Cola Amatil Ltd’s [ASX:CCL] soft drink and water business ratio.
Their net profit jumped by 81% to $445.2 million since 31 December last year.
Coca-Cola’s share price sits at $8.725 during time of writing.
Coca-Cola’s dividend increased to 26 cents a share.
The company’s market cap stands at $6.295 billion, and has an enterprise value of $7.92 billion.
Coca-Cola distribute a wide range of products, from Mount Franklin to Fiji Water and, of course, their most well-known product, Coke.
Is CCL’s growth stable?
Coca-Cola’s Fiji and New Zealand segment grew in revenue. And in Papua New Guinea and Indonesia as well, as the coffee and alcohol segments increased also.
Management also reported Coca-Cola had lowered net financial costs despite the accelerated debt.
CCL shares, which have fallen over the last year, have recently risen despite the consistent fall across 2017.
Coca-Cola lifting profits
CCL will be heavily promoting its Coke and Mount Franklin brands, while building awareness for its smaller brands in order to reduce prices throughout 2018.
On Wednesday, they spoke of a planned $40 million in additional investments across the marketing and technology sector to drive growth.
The company has taken precautions since its slight decline in 2017.
CCL managing director Alison Watkins said:
‘Since then, our team has done a really good job of making sure our water is right as far as price goes…and we’ve made some price adjustments to Mount Franklin and in the sparkling [soft drinks] area.’
Watkins believes the $40 million investment would help CCL recover from last year’s minor decline and prosper over the course of the year.
She believes they must build awareness across their strongest brand — Coca-Cola.
Watkins stated the new investments will help boost other successful brands, such as Monster and Mother.
CCL are confident their new investment strategy will have a positive effect on this year’s earnings.
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