Advancing ASEAN: Philippines sales lead growth for Coca-Cola Europacific in Asia Pacific region for first half of 2024
CCEP recently announced its H1FY2024 financial results, reporting a growth of 3.5% year-on-year in revenue to EUR10.1bn (US$) and a 9% year-on-year growth in operating profits to EUR1.3bn (US$).
A large part of this positive performance was attributed to the firm’s business in its Australia, Pacific and South East Asia (APS) business unit, particularly significant growth in its newest acquisition in the Philippines.
“The great performance of our APS business unit has helped offset softer volumes in Europe, driven by strategic de-listings and some adverse weather,” CCEP CEO Damian Gammell told the floor during the firm’s financial results analyst call meeting.
“About a third of our volumes are now delivered by our APS business unit [with] double-digit growth in South East Asia, driven by the Philippines [where] Coca-Cola Original Taste and Sprite both performed well.
“Underlying market demand remains strong, growing high single-digit, with a large, young and growing population. [We are] now at 74% share of the sparkling market and 47% share of the NARTD (non-alcoholic ready-to-drink) market.”
Moving forward, the firm hopes to further build on this momentum to capitalise on a variety of beverage category opportunities in the Philippines.
“We see lots of opportunities, both long and short-term, which naturally will be led by Coke Trademark,” he said.
“But we also see opportunities in low and no sugar as well as in the energy category where we have recently launched the more affordable Predator offering.
“We are also expanding our presence in ARTD (alcoholic ready-to-drink) with the launch of Peach Lemon-Dou and Jack Daniels & Coca-Cola Zero.”
Indonesia issues
In addition to the Philippines, CCEP has also been undertaking a massive portfolio transformation in Indonesia to better meet local consumer demands, but has seen setbacks to progress in the past six months which the firm has attributed to geopolitical factors.
“In Indonesia, we had an encouraging first quarter [but following this] have seen more mixed demand reflecting the geopolitical situation,” CCEP CFO Ed Walker told the floor.
“We do however remain confident in our transformation plan and the long-term opportunity in the market.”
Gammell added that Indonesia is still considered one of the company’s major expanding markets, and that the geopolitical impacts – more precisely referring to a general negative perception of many western brands due to the situation in Israel – are not affecting sales uniformly in the entire market.
“Like many other western brands in Indonesia, our first half was impacted by the geopolitical situation in the Middle East - however this is not across all regions in the country,” he said.
“In fact, unaffected areas are delivering encouraging volume and transaction growth. It is important therefore to focus on what we can control and influence in this market, being our long-term transformation journey.
“We continue to build sparkling relevance and build on our RTD tea offering, with flavour extensions like Fanta Grape and Frestea Lemongrass [and] are accelerating our zero products mix, which is seeing strong growth especially in the modern trade.
“And we have a strong targeted activation programme underway, focused on connecting with the young and growing consumer base extending to 500 universities this year [as part of] taking the right decisions to re-engineer both our cost base and accelerate our route to market transformation to be fit for the longer term here.”
