Business Services Industry
Coca-Cola Enterprises Inc. Reports Third-Quarter 2001 Results
Business Wire, Oct 17, 2001
Business Editors
ATLANTA--(BUSINESS WIRE)--Oct. 17, 2001--Coca-Cola Enterprises
(NYSE:CCE):
-- Third-quarter 2001 constant territory volume increased
3 percent in North America and 12 1/2 percent in Europe.
-- Net income per diluted common share was 10 cents, excluding
previously announced charges and a nonrecurring Canadian tax
benefit.
Coca-Cola Enterprises today reported that third-quarter 2001
reported net income applicable to common shareowners was $25 million,
or 6 cents per diluted common share. Reported third-quarter results
include the Herb Coca-Cola acquisition completed in July 2001,
restructuring and other nonrecurring charges of $41 million or 6 cents
per diluted common share, and a $6 million nonrecurring reduction in
income tax expense.
Reported cash operating profit(a) totaled $581 million for third
quarter 2001, and approximately $1.58 billion for the first nine
months of 2001. Comparable cash operating profit, which excludes
nonrecurring charges and includes the Herb acquisition in the third
quarter, was $622 million for the third quarter and $1.62 billion for
the first nine months. These results compare to third-quarter 2000
cash operating profit of $723 million and $1.89 billion for the first
nine months.
(a) Cash operating profit is defined as earnings before deducting
interest, taxes, depreciation, amortization, and other
nonoperating items.
"Our third quarter results reflect the operating dynamics we
communicated in July, with North American price realization below the
level required to cover our cost and operating expense increases,"
Mr. Kline said. "While these results are within the range of
previously established guidance, we continue to seek additional
pricing as market opportunities permit."
The Company earlier this year announced a restructuring designed
to improve the Company's North American operating cost structure.
Management currently anticipates total charges associated with the
restructuring to approximate $80 million. Approximately $41 million of
these charges were recorded in the third quarter and the balance will
occur in the fourth quarter.
"The restructuring of our North American group is proceeding
smoothly and it is clear that we are taking the appropriate steps for
our business," Mr. Kline said. "Our efforts to date have confirmed
that we will achieve significant efficiencies and cost savings. As a
result, we remain very confident that we will reach our annual savings
goal of $80 to $100 million, beginning next year."
Operating Results
Physical case bottle and can volume increased 5 percent on a
comparable basis for the quarter. North America grew more than
3 percent as Dasani and Minute Maid Lemonade led the growth of the
Company's new brands. In Europe, favorable July weather helped
generate remarkable volume growth of more than 30 percent for that
month. European volume advanced by 12 1/2 percent for the quarter with
strong performance from our major carbonated brands as well as new
product introductions. Year-to-date comparable volume growth totaled
3 1/2 percent with growth in North America of 2 percent and Europe
growth of 8 1/2 percent.
"We are working diligently to improve our financial performance,
and we are encouraged by our strongest quarterly volume performance of
the year," said John R. Alm, president and chief operating officer.
"Our North American growth came as a result of successful marketplace
activation of new brands that are receiving excellent consumer
acceptance.
"We are very pleased with our new product growth and the continued
growth opportunities we see for Dasani," Mr. Alm continued. "We also
look forward to the national rollout of diet Coke with Lemon and
believe it will bring new consumers into our core brand franchise.
"At the same time, we believe we can grow our core brands
independent of line extensions," Mr. Alm said. "We are developing
advertising, marketing and packaging strategies for these brands with
The Coca-Cola Company that make us confident we will accomplish this
task."
Consolidated and North American bottle and can net pricing per
case increased 1 percent in the third quarter, while consolidated
bottle and can cost of goods per case increased 3 1/2 percent. All per
case comparisons are presented on a comparable basis excluding the
effects of currency translations.
For the first nine months, bottle and can net pricing per case
increased 1 percent for the total company. Bottle and can cost of
goods sold per case increased 3 percent for the first nine months.
Full-Year 2001 Expectations
"With additional new brands in the pipeline, such as diet Coke
with Lemon and Mad River, a powerful promotional campaign for brand
Coca-Cola in conjunction with Harry Potter, and our traditional
holiday strength, we are well-positioned to deliver North American
volume growth of 2 percent for the full year," Mr. Alm said.
Management expects full-year 2001 volume growth in Europe to total
more than 6 percent.
The Company currently expects cash operating profit to be within
the previously announced range of $2.05 to $2.1 billion, excluding the
partial-year results of the Herb Coca-Cola acquisition. Herb Coca-Cola
is expected to add approximately $65 to $70 million to these results.
Full-year 2001 earnings per diluted common share will range from
1 to 5 cents. These figures reflect existing foreign currency
translation rates and exclude nonrecurring items.
The Company will webcast its third quarter conference call with
analysts and investors live over the Internet today at 9 a.m. EDT. The
call can be accessed through the Company's website at www.cokecce.com.
Coca-Cola Enterprises Inc. (NYSE: CCE) is the world's largest
marketer, distributor, and producer of bottle and can liquid
nonalcoholic refreshment. Coca-Cola Enterprises sells approximately
80 percent of The Coca-Cola Company's bottle and can volume in North
America and is the sole licensed bottler for products of The Coca-Cola
Company in Belgium, continental France, Great Britain, Luxembourg,
Monaco, and the Netherlands.
Forward-Looking Statements
Included in this news release are several forward-looking
management comments and other statements that reflect management's
current outlook for future periods. As always, these expectations are
based on the currently available competitive, financial, and economic
data along with the Company's operating plans and are subject to
future events and uncertainties. The forward-looking statements in
this news release should be read in conjunction with the detailed
cautionary statements found on page 48 of the Company's 2000 Annual
Report, and on page 21 of the Company's Second-Quarter 2001 Form 10-Q.
COCA-COLA ENTERPRISES INC.
KEY OPERATING INFORMATION
Comparable
Currency
Third-Quarter 2001 Change Neutral
------------------ ------ ----------
Cash Operating Profit (18)% (13)%
Net Pricing Per Case (Bottle and Can) (a) (1/2)% 1 %
Cost of Sales Per Case (Bottle and Can) 1 1/2 % 3 1/2 %
Physical Case Bottle and Can Volume (b)
Consolidated 5 %
North America 3 %
Europe 12 1/2 %
Fountain Gallon Volume 1 %
Comparable
Currency
Nine-Months 2001 Change Neutral
---------------- ------ ----------
Cash Operating Profit (16)% (13)%
Net Pricing Per Case (Bottle and Can) (a) (1)% 1 %
Cost of Sales Per Case (Bottle and Can) 1/2 % 3 %
Physical Case Bottle and Can Volume (b)
Consolidated 3 1/2 %
North America 2 %
Europe 8 1/2 %
Fountain Gallon Volume 1/2 %
(a) Net pricing per case is calculated as invoice pricing less
allowances.
(b) Volume results have been adjusted to include acquisitions
completed in 2000 and 2001.
COCA-COLA ENTERPRISES INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited; In Millions Except Per Share Data)
Third Quarter
---------------------------------
2001(a) 2000(b) Change
------- ------- ------
Net Operating Revenues $ 4,276 $ 3,868 11 %
Cost of Sales 2,660 2,368 12 %
------- -------
Gross Profit 1,616 1,500 8 %
Selling, Delivery, and
Administrative Expenses 1,376 1,105 25 %
------- -------
Operating Income 240 395 (39)%
Interest Expense, Net 189 197
Other Nonoperating Income, Net 1 -
------- -------
Income Before Income Taxes 52 198
Income Tax Expense 32 67
Income Tax Rate Change
(Benefit) (c) (6) -
------- -------
Net Income 26 131
Preferred Stock Dividends 1 1
------- -------
Net Income Applicable to
Common Shareowners $ 25 $ 130
======= =======
Basic Average Common Shares
Outstanding 442 418
======= =======
Basic Net Income Per Share
Applicable to Common
Shareowners (d) $ 0.06 $ 0.31
======= =======
Diluted Average Common Shares
Outstanding 449 427
======= =======
Diluted Net Income Per Share
Applicable to Common
Shareowners (d) $ 0.06 $ 0.30
======= =======
Cash Operating Profit Data:
Operating Income $ 240 $ 395 (39)%
Depreciation 228 203 12 %
Amortization 113 113 -
------- -------
Cash Operating Profit $ 581 $ 711 (18)%
======= =======
(a) 2001 includes $41 million in restructuring and other
nonrecurring items.
(b) 2000 results include insurance proceeds of $20 million related
to the 1999 product recall.
(c) Represents a nonrecurring reduction in deferred taxes.
(d) Per share data calculated prior to rounding to millions.
COCA-COLA ENTERPRISES INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited; In Millions Except Per Share Data)
Nine Months
---------------------------------
2001(a) 2000(b) Change
------- ------- ------
Net Operating Revenues $11,732 $11,189 5 %
Cost of Sales 7,273 6,863 6 %
------- -------
Gross Profit 4,459 4,326 3 %
Selling, Delivery, and
Administrative Expenses 3,883 3,399 14 %
------- -------
Operating Income 576 927 (38)%
Interest Expense, Net 568 593
Other Nonoperating Income, Net - -
------- -------
Income Before Income Taxes 8 334
Income Tax Expense 4 113
Income Tax Rate Change (Benefit) (c) (52) -
------- -------
Net Income 56 221
Preferred Stock Dividends 3 3
------- -------
Net Income Applicable to
Common Shareowners $ 53 $ 218
======= =======
Basic Average Common Shares
Outstanding 427 419
======= =======
Basic Net Income Per Share
Applicable to Common
Shareowners (d) $ 0.13 $ 0.52
======= =======
Diluted Average Common Shares
Outstanding 435 429
======= =======
Diluted Net Income Per Share
Applicable to Common
Shareowners (d) $ 0.12 $ 0.51
======= =======
Cash Operating Profit Data:
Operating Income $ 576 $ 927 (38)%
Depreciation 665 603 10 %
Amortization 338 340 (1)%
------- -------
Cash Operating Profit $ 1,579 $ 1,870 (16)%
======= =======
(a) 2001 includes $41 million in restructuring and other
nonrecurring items.
(b) 2000 results include a nonrecurring charge of $12 million
related to Great Britain, and $20 million in insurance
proceeds.
(c) Represents a nonrecurring reduction in deferred taxes.
(d) Per share data calculated prior to rounding to millions.
COCA-COLA ENTERPRISES INC.
PRELIMINARY CONDENSED CONSOLIDATED BALANCE SHEETS
(In Millions)
September 28, December 31,
2001 2000
------------- ------------
(Unaudited)
ASSETS
Current
Cash and cash investments $ 180 $ 294
Trade accounts receivable,
net 1,554 1,297
Inventories 752 602
Prepaid expenses and other
current assets 389 438
---------- ----------
Total Current Assets 2,875 2,631
Net Property, Plant, and Equipment 6,089 5,783
Franchises and Other Noncurrent
Assets, Net 14,757 13,748
---------- ----------
$ 23,721 $ 22,162
========== ==========
LIABILITIES AND SHAREOWNERS' EQUITY
Current
Accounts payable and accrued
expenses $ 2,497 $ 2,321
Current portion of long-term debt 980 773
---------- ----------
Total Current Liabilities 3,477 3,094
Long-Term Debt, Less Current Maturities 11,193 10,348
Retirement and Insurance Programs
And Other Long-Term Obligations 1,043 1,112
Long-Term Deferred Income Tax
Liabilities 4,711 4,774
Shareowners' Equity 3,297 2,834
---------- ----------
$ 23,721 $ 22,162
========== ==========
COCA-COLA ENTERPRISES INC.
CONSOLIDATED STATEMENTS OF INCOME EXCLUDING NONRECURRING ITEMS
(Unaudited; In Millions Except Per Share Data)
COMPARABLE (a)
THIRD QUARTER
---------------------------------
2001(b) 2000(c) Change
------- ------- ------
Net Operating Revenues $ 4,276 $ 4,096 4 %
Cost of Sales 2,660 2,508 6 %
------- -------
Gross Profit 1,616 1,588 2 %
Selling, Delivery, and
Administrative Expenses 1,335 1,193 12 %
------- -------
Operating Income 281 395 (29)%
Interest Expense, Net 189 212
Other Nonoperating Expense
(Income), Net (1) 1
------- -------
Income Before Income Taxes 93 182
Income Tax Expense 48 62
------- -------
Net Income 45 120
Preferred Stock Dividends 1 1
------- -------
Net Income Applicable to
Common Shareowners $ 44 $ 119
======= =======
Basic Average Common Shares
Outstanding 442 443
======= =======
Basic Net Income Per Share
Applicable to Common
Shareowners $ 0.10 $ 0.27
======= =======
Diluted Average Common Shares
Outstanding 449 452
======= =======
Diluted Net Income Per Share
Applicable to Common
Shareowners $ 0.10 $ 0.26
======= =======
Cash Operating Profit Data:
Operating Income $ 281 $ 395 (29)%
Depreciation 228 215 6 %
Amortization 113 113 -
------- -------
Cash Operating Profit $ 622 $ 723 (14)%
======= =======
Note: This comparable information is provided solely for the
purposes of additional analysis of the acquisition of Herb
Coca-Cola and is not intended to be a presentation in
conformity with the rules governing the preparation of pro
forma financial information.
(a) Comparable results exclude all nonrecurring items and include
the Herb acquisition for the third quarter of 2000 and 2001.
(b) 2001 excludes $41 million in restructuring and other
nonrecurring items and $6 million in nonrecurring deferred
income tax reductions.
(c) 2000 excludes $20 million in insurance proceeds and $2 million
of occupancy expense related to Herb Coca-Cola.
COCA-COLA ENTERPRISES INC.
CONSOLIDATED STATEMENTS OF INCOME EXCLUDING NONRECURRING ITEMS
(Unaudited; In Millions Except Per Share Data)
COMPARABLE (a)
NINE MONTHS
---------------------------------
2001(b) 2000(c) Change
------- ------- ------
Net Operating Revenues $11,732 $11,416 3 %
Cost of Sales 7,273 7,003 4 %
------- -------
Gross Profit 4,459 4,413 1 %
Selling, Delivery, and
Administrative Expenses 3,842 3,474 11 %
------- -------
Operating Income 617 939 (34)%
Interest Expense, Net 568 608
Other Nonoperating Expense, Net - 1
------- -------
Income Before Income Taxes 49 330
Income Tax Expense 20 112
Income Tax Rate Change (Benefit) - -
------- -------
Net Income 29 218
Preferred Stock Dividends 3 2
------- -------
Net Income Applicable to
Common Shareowners $ 26 $ 216
======= =======
Basic Average Common Shares
Outstanding 427 428
======= =======
Basic Net Income Per Share
Applicable to Common
Shareowners $ 0.06 $ 0.50
======= =======
Diluted Average Common Shares
Outstanding 435 438
======= =======
Diluted Net Income Per Share
Applicable to Common
Shareowners $ 0.06 $ 0.49
======= =======
Cash Operating Profit Data:
Operating Income $ 617 $ 939 (34)%
Depreciation 665 615 8 %
Amortization 338 339 -
------- -------
Cash Operating Profit $ 1,620 $ 1,893 (14)%
======= =======
Note: This comparable information is provided solely for the
purposes of additional analysis of the acquisition of Herb
Coca-Cola and is not intended to be a presentation in
conformity with the rules governing the preparation of pro
forma financial information.
(a) Comparable results exclude all nonrecurring items and include
the Herb acquisition for the third quarter of 2000 and 2001.
(b) 2001 excludes $41 million in restructuring and other
nonrecurring items and $52 million in nonrecurring deferred
income tax reductions.
(c) 2000 excludes $20 million in insurance proceeds, a
nonrecurring charge of $12 million related to Great Britain
and $2 million of occupancy expense related to Herb Coca-Cola.
--30--lk/at*
CONTACT: Coca-Cola Enterprises
Investor Relations
Scott Anthony, 770/989-3105
or
Media Relations
Laura Asman, 770/989-3023
or
Shareowner Relations
Helene Krupp, 770/989-3620
KEYWORD: GEORGIA
INDUSTRY KEYWORD: FOODS/BEVERAGES RETAIL EARNINGS
SOURCE: Coca-Cola Enterprises Inc.
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COPYRIGHT 2001 Gale Group
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