First-quarter diluted earnings per common share totaled 35 cents on
a reported basis, or 36 cents on a comparable basis.
Revenue was $1.87 billion, up 1˝ percent on a reported basis and 5
percent on a currency neutral basis, including a 2˝ percent impact
from the French excise tax increase.
Operating income was $171 million on a reported basis, and $175
million on a comparable basis. Comparable operating income was up 1
percent, or 6 percent on a currency neutral basis.
Volume declined ˝ percent reflecting the French excise tax
implementation and prior year growth hurdles, partially offset by
favorable late quarter conditions.
CCE affirms full-year guida
Regulatory News:
Coca-Cola Enterprises, Inc. (NYSE/Euronext Paris: CCE) today reported
first-quarter 2012 operating income of $171 million, or $175 million on
a comparable basis. First-quarter 2012 diluted earnings per common share
were 35 cents on a reported basis, or 36 cents on a comparable basis.
Currency translation had a negative impact of 2 cents per share compared
to prior year results. Items affecting comparability are detailed on
pages 10 through 12 of this release.
For the quarter, revenue totaled $1.87 billion, an increase of 1˝
percent from 2011 results, up 5 percent on a currency neutral basis, and
up 2˝ percent on a currency neutral basis excluding the impact of the
French excise tax increase. Comparable operating income totaled $175
million, up 6 percent on a comparable and currency neutral basis.
"Our results demonstrate our ability to deliver even as we worked
through a challenging first quarter," said John F. Brock, chairman and
chief executive officer. "We have outstanding sales initiatives and
operating plans in place that will enhance our marketplace presence,
enable us to closely control expenses, and ultimately, deliver solid
growth for the full year."
OPERATING REVIEW
First-quarter 2012 volume declined ˝ percent. This includes the impact
of the excise tax increase in France earlier this year and the
comparison to strong results in the same quarter a year ago, partially
offset by favorable operating conditions late in the quarter, including
weather and timing of the Easter holiday. For the quarter, Coca-Cola
trademark brands were up 1 percent led by growth in Coca-Cola Zero.
Sparkling flavors declined in a low single-digit range, compared to
prior year growth of 6˝ percent. Energy brands, driven by Monster and
Powerade Energy in Great Britain, continued to have significant growth.
Still beverages declined in a mid-single-digit range, compared to prior
year increase of 14˝ percent. Volume in Great Britain declined
approximately 1 percent, compared to prior year growth of 6˝ percent.
Volume in continental Europe (including Norway and Sweden) was flat.
First quarter net pricing per case was up 5 percent and cost of sales
per case grew 6˝ percent in the quarter, both including the impact of
the French excise tax increase. Excluding impact of the French excise
tax increase, net pricing per case increased 2˝ percent, and cost of
sales per case also increased 2˝ percent. Operating expenses were up
modestly, reflecting timing, continued expense control, and volume
declines. These figures are comparable and currency neutral.
"As we enter the important summer selling season, we are confident in
our ability to maximize the benefit of operating plans for the London
Olympic and Paralympic Games and the Euro 2012 soccer championship,"
said Hubert Patricot, executive vice president and president, European
Group. "In addition, our people continue with outstanding day-to-day
execution in the marketplace, and we are managing each aspect of the
business to deliver positive results in an effective, efficient, and
sustainable way."
SHARE REPURCHASE
As previously announced, CCE began a new $1 billion share repurchase
program in January, and we remain on track to complete repurchases of at
least $500 million of our shares by the end of 2012. CCE purchased $150
million of its shares during the first quarter. These plans may be
adjusted depending on economic, operating, or other factors, including
acquisition opportunities.
FULL-YEAR 2012 OUTLOOK
For 2012, CCE continues to expect earnings per diluted common share
growth of approximately 10 percent. Revenue is expected to grow in a
high single-digit range, with operating income growth in a
mid-single-digit range. Our outlook for EPS growth, revenue, and
operating income includes the impact of the French excise tax increase,
and is comparable and currency neutral. Although it is still early to
predict the full-year 2012 currency impact, currency translation would
decrease full-year earnings per share by approximately 6 percent, based
on recent rates.
The company continues to expect 2012 free cash flow in a range of $500
million to $525 million, with capital expenditures in a range of $400
million to $425 million. Weighted average cost of debt is expected to be
approximately 3 percent, and the effective tax rate for 2012 is expected
to be in a range of 26 percent to 28 percent.
CONFERENCE CALL
CCE will host a conference call with investors and analysts today at 10
a.m. ET. The call can be accessed through our website at www.cokecce.com.
Coca-Cola Enterprises, Inc. is the leading Western European marketer,
distributor, and producer of bottle and can liquid nonalcoholic
refreshment and one of the world's largest Coca-Cola bottlers. CCE is
the sole licensed bottler for products of The Coca-Cola Company in
Belgium, continental France, Great Britain, Luxembourg, Monaco, the
Netherlands, Norway, and Sweden. For more information about our company,
please visit our website at www.cokecce.com.
FORWARD-LOOKING STATEMENTS
Included in this news release are forward-looking management comments
and other statements that reflect management's current outlook for
future periods. As always, these expectations are based on currently
available competitive, financial, and economic data along with our
current operating plans and are subject to risks and uncertainties that
could cause actual results to differ materially from the results
contemplated by the forward-looking statements. The forward-looking
statements in this news release should be read in conjunction with the
risks and uncertainties discussed in our filings with the Securities and
Exchange Commission("SEC"), including our Form 10-K for the year
ended December 31, 2011, and other SEC filings.
COCA-COLA ENTERPRISES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited; In Millions, Except Per Share Data)
First Quarter
2012
2011
Net Operating Revenues
$
1,868
$
1,844
Cost of Sales
1,212
1,183
Gross Profit
656
661
Selling, Delivery, and Administrative Expenses
485
497
Operating Income
171
164
Interest Expense, Net
23
19
Other Nonoperating Income (Expense), Net
1
(1
)
Income Before Income Taxes
149
144
Income Tax Expense
40
38
Net Income
$
109
$
106
Basic Earnings Per Common Share
$
0.36
$
0.32
Diluted Earnings Per Common Share
$
0.35
$
0.31
Dividends Declared Per Common Share
$
0.16
$
0.12
Basic Weighted Average Common Shares Outstanding
302
329
Diluted Weighted Average Common Shares Outstanding
310
338
COCA-COLA ENTERPRISES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited; In Millions)
First Quarter
2012
2011
Net Income
$
109
$
106
Components of Other Comprehensive Income:
Currency Translations
122
175
Net Investment Hedges, Net of Tax
(5
)
(2
)
Cash Flow Hedges, Net of Tax
(1
)
17
Pension Plan Liability Adjustments, Net of Tax
3
1
Other Comprehensive Income
119
191
Comprehensive Income
$
228
$
297
COCA-COLA ENTERPRISES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited; In Millions)
March 30,
December 31,
2012
2011
ASSETS
Current:
Cash and cash equivalents
$
296
$
684
Trade accounts receivable, net
1,589
1,387
Amounts receivable from The Coca-Cola Company
62
64
Inventories
441
403
Other current assets
177
148
Total Current Assets
2,565
2,686
Property, plant, and equipment, net
2,250
2,230
Franchise license intangible assets, net
3,890
3,771
Goodwill
130
124
Other noncurrent assets, net
329
283
Total Assets
$
9,164
$
9,094
LIABILITIES
Current:
Accounts payable and accrued expenses
$
1,702
$
1,716
Amounts payable to The Coca-Cola Company
86
116
Current portion of debt
244
16
Total Current Liabilities
2,032
1,848
Debt, less current portion
2,788
2,996
Other noncurrent liabilities
183
160
Noncurrent deferred income tax liabilities
1,219
1,191
Total Liabilities
6,222
6,195
SHAREOWNERS' EQUITY
Common stock
3
3
Additional paid-in capital
3,758
3,745
Reinvested earnings
699
638
Accumulated other comprehensive loss
(354
)
(473
)
Common stock in treasury, at cost
(1,164
)
(1,014
)
Total Shareowners' Equity
2,942
2,899
Total Liabilities and Shareowners' Equity
$
9,164
$
9,094
COCA-COLA ENTERPRISES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited; In Millions)
First Quarter
2012
2011
Cash Flows From Operating Activities:
Net income
$
109
$
106
Adjustments to reconcile net income to net cash (used in) derived
from operating activities:
Depreciation and amortization
86
78
Deferred income tax benefit
(35
)
(43
)
Pension expense less than contributions
(48
)
(4
)
Net change in assets and liabilities
(241
)
(129
)
Net cash (used in) derived from operating activities
(129
)
8
Cash Flows From Investing Activities:
Capital asset investments
(72
)
(83
)
Net cash used in investing activities
(72
)
(83
)
Cash Flows From Financing Activities:
Change in commercial paper, net
-
(145
)
Issuances of debt
-
400
Payments on debt
(4
)
(4
)
Share repurchases
(150
)
(200
)
Dividend payments on common stock
(48
)
(39
)
Exercise of employee share options
6
2
Net cash received from The Coca-Cola Company for
transaction-related items
-
48
Net cash (used in) derived from financing activities
(196
)
62
Net effect of currency exchange rate changes on cash and cash
equivalents
9
13
Net Change In Cash and Cash Equivalents
(388
)
-
Cash and Cash Equivalents at Beginning of Year
684
321
Cash and Cash Equivalents at End of Year
$
296
$
321
COCA-COLA ENTERPRISES, INC.
RECONCILIATION OF GAAP TO NON-GAAP
(Unaudited; In Millions, Except Per Share Data which is
calculated prior to rounding)
Reconciliation of Income(a)
First-Quarter 2012
Items Impacting Comparability
Reported (GAAP)(b)
Net Mark-to-Market Commodity Hedges(c)
Restructuring Charges(d)
Comparable (non-GAAP)
Net Operating Revenues
$
1,868
$
-
$
-
$
1,868
Cost of Sales
1,212
2
-
1,214
Gross Profit
656
(2
)
-
654
Selling, Delivery, and Administrative Expenses
485
2
(8
)
479
Operating Income
171
(4
)
8
175
Interest Expense, Net
23
-
-
23
Other Nonoperating Income, Net
1
-
-
1
Income Before Income Taxes
149
(4
)
8
153
Income Tax Expense
40
(1
)
2
41
Net Income
$
109
$
(3
)
$
6
$
112
Diluted Earnings Per Common Share
$
0.35
$
(0.01
)
$
0.02
$
0.36
Reconciliation of Income (a)
First-Quarter 2011
Items Impacting Comparability
Reported (GAAP) (b)
Net Mark-to-Market Commodity Hedges(c)
Restructuring Charges (d)
Comparable (non-GAAP)
Net Operating Revenues
$
1,844
$
-
$
-
$
1,844
Cost of Sales
1,183
-
-
1,183
Gross Profit
661
-
-
661
Selling, Delivery, and Administrative Expenses
497
5
(14
)
488
Operating Income
164
(5
)
14
173
Interest Expense, Net
19
-
-
19
Other Nonoperating Income, Net
(1
)
-
-
(1
)
Income Before Income Taxes
144
(5
)
14
153
Income Tax Expense
38
(1
)
4
41
Net Income
$
106
$
(4
)
$
10
$
112
Diluted Earnings Per Common Share
$
0.31
$
(0.01
)
$
0.03
$
0.33
(a) These non-GAAP measures are provided to allow
investors to more clearly evaluate our operating performance and
business trends. Management uses this information to review results
excluding items that are not necessarily indicative of ongoing
results. The adjusting items are based on established defined terms
and thresholds and represent all material items management
considered for year-over-year comparability.
(b) As reflected in CCE's U.S. GAAP Condensed
Consolidated Financial Statements.
(c) Amounts represent the net out of period
mark-to-market impact of non-designated commodity hedges.
(a) These non-GAAP measures are provided to allow
investors to more clearly evaluate our operating performance and
business trends. Management uses this information to review results
excluding items that are not necessarily indicative of ongoing
results. The adjusting items are based on established defined terms
and thresholds and represent all material items management
considered for year-over-year comparability.
(b) As reflected in CCE's U.S. GAAP Condensed
Consolidated Financial Statements.
(c) Amounts represent the net out of period
mark-to-market impact of non-designated commodity hedges.
First-Quarter 2012 Change Versus First-Quarter
2011
Net Revenues Per Case
Change in Net Revenues per Case
2.0%
Impact of Post Mix, Non-Trade, and Other
(0.5)%
Impact of Currency Exchange Rate Changes
3.5%
Bottle and Can Net Pricing Per Case
Including French Excise Tax Increase
5.0%
Impact of French Excise Tax Increase
(2.5)%
Comparable Currency-Neutral Bottle and Can
Net Pricing Per Case(a)
2.5%
Cost of Sales Per Case
Change in Cost of Sales per Case
3.0%
Impact of Post Mix, Non-Trade, and Other
0.0%
Impact of Currency Exchange Rate Changes
3.5%
Bottle and Can Cost of Sales Per Case
Including French Excise Tax Increase
6.5%
Impact of French Excise Tax Increase
(4.0)%
Comparable Currency-Neutral Bottle and Can
Cost of Sales Per Case(a)
2.5%
Physical Case Bottle and Can Volume
Comparable Bottle and Can Volume(b)
(0.5)%
First Quarter
Reconciliation of Free Cash Flow (c)
2012
2011
Net Cash Derived From Operating Activities
$
(129
)
$
8
Less: Capital Asset Investments
(72
)
(83
)
Free Cash Flow
$
(201
)
$
(75
)
March 30,
December 31,
Reconciliation of Net Debt (d)
2012
2011
Current Portion of Third Party Debt
$
244
$
16
Debt, Less Current Portion
2,788
2,996
Less: Cash and Cash Equivalents
(296
)
(684
)
Net Debt
$
2,736
$
2,328
(a)
The non-GAAP financial measures "Comparable Currency-Neutral
Bottle and Can Net Pricing Per Case" and "Comparable
Currency-Neutral Bottle and Can Cost of Sales per Case" are used
to more clearly evaluate bottle and can pricing and cost trends in
the marketplace. These measures exclude: (1) items not directly
related to bottle and can pricing or cost; (2) currency exchange
rate changes; and (3) the impact of the French excise tax increase
effective January 1, 2012.
(b)
The non-GAAP measure "Comparable Bottle and Can Volume" is used to
analyze the performance of our business on a constant period
basis. There were the same number of selling days in the first
quarter of 2012 and 2011.
(c)
The non-GAAP measure "Free Cash Flow" is provided to focus
management and investors on the cash available for debt reduction,
dividend distributions, share repurchase, and acquisition
opportunities.
(d)
The non-GAAP measure "Net Debt" is used to more clearly evaluate our
capital structure and leverage.
Coca-Cola Enterprises, Inc. Investor Relations Thor
Erickson, +1 (678) 260-3110 or Media Relations Fred
Roselli, +1 (678) 260-3421 or European Media
Relations Lauren Sayeski, +44 (0) 7976 113 674
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