Earnings Release • Aug 19, 2024
Earnings Release
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• Sales volume +0.7%
16:00 Istanbul
14:00 London
09:00 New York
Our second quarter performance was another testament to the resilience of our operating model and the strength of our people. Despite the external challenges, our focus on quality growth and operational excellence have enabled us to navigate this volatile environment effectively.
We are happy to report a consolidated revenue of TL 36.6 billion in 2Q24. Our focus on revenue growth management combined with cost control has paid off, leading to a 487 bps year-over-year improvement (y/y) in our gross margin. EBIT margin improved by 104 bps y/y to 18.8%, while Earnings per Share (EPS) was \$0.66 in the quarter.
We managed to deliver \$2.58 Net Sales Revenue/uc before TAS 29 – the highest among the second quarters of the last decade, implying a growth of 3.6% y/y in \$ terms. Again, without TAS 29, our EBIT margin reached 20.4% - the highest second quarter margin of the last decade. This improvement reflects our ability to adapt to rapidly evolving market conditions, and drive efficiencies across the organization, while effectively locking in favorable hedges for commodities.
In 2Q24, Türkiye recorded 1.8% y/y volume growth, reaching 169 million uc. While Ramadan's pull-forward to 1Q capped y/y growth, effective trade promotions and active consumer marketing with UEFA Euro Cup activations have resulted in successful volume generation vs prior year and prior quarter. In international operations, we have recorded 0.1% y/y improvement after realizing 7.2% y/y decline in 1Q24.
Our purpose is to create value for all stakeholders. Hence, we are proud to share that our circular economy practices have been accredited by the International Finance Corporation (IFC). The IFC issued an umbrella loan of \$250 million to CCI in Türkiye, Uzbekistan, Tajikistan, and Iraq, to reduce energy and water usage and to address the gender gap in our workplace, in line with our 2030 pledge.
Our disciplined approach to preserving balance sheet strength while maintaining flexibility, combined with our sustainable value generation has resulted in the reiteration of our BBB rating by Fitch despite the on-going economic and social volatility our markets are facing. This once again confirms our status as the highestrated entity in Türkiye.
Looking ahead to 2024, we remain cautiously optimistic but are revising our full-year guidance to better reflect current consumer sensitivities and on-going macroeconomic challenges. We now expect flat to low single digit volume growth on an organic basis and low 30% levels of FX neutral revenue growth. We will put relentless effort to deliver in line with our previous EBIT margin guidance of "flat vs previous year". We do, however, see risk of a slight decline in EBIT margin vs previous year, if the operating environment deteriorates further. Incorporating this, we amend our EBIT margin guidance as "slight decline to flat vs last year".
Thanks to our talented team dedicated to creating sustainable value, we are mindful of ongoing macroeconomic challenges. Yet, we are confident in our strategic direction, the favorable fundamentals of our operating countries, and our ability to adapt to changing market dynamics to ensure CCI's continued profitable growth in the mid to long term.
| Consolidated (million TL) | 2Q24 | 2Q23 | Change % | 1H24 | 1H23 | Change % |
|---|---|---|---|---|---|---|
| Volume (million UC) | 451 | 448 | 0.7% | 793 | 801 | -1.0% |
| Net Sales | 36,600 | 39,315 | -6.9% | 66,119 | 67,988 | -2.7% |
| Gross Profit | 13,956 | 13,075 | 6.7% | 23,766 | 21,896 | 8.5% |
| EBIT | 6,896 | 7,000 | -1.5% | 10,378 | 10,419 | -0.4% |
| EBIT (Exc. other) | 6,783 | 6,619 | 2.5% | 10,210 | 9,999 | 2.1% |
| EBITDA | 8,319 | 7,955 | 4.6% | 13,158 | 12,724 | 3.4% |
| EBITDA (Exc. other) | 8,101 | 7,979 | 1.5% | 12,976 | 12,725 | 2.0% |
| Profit Before Tax | 6,773 | 7,147 | -5.2% | 11,743 | 12,218 | -3.9% |
| Net Income/(Loss) | 5,408 | 4,501 | 20.2% | 8,352 | 7,948 | 5.1% |
| Gross Profit Margin | 38.1% | 33.3% | 35.9% | 32.2% | ||
| EBIT Margin | 18.8% | 17.8% | 15.7% | 15.3% | ||
| EBIT Margin (Exc. other) | 18.5% | 16.8% | 15.4% | 14.7% | ||
| EBITDA Margin | 22.7% | 20.2% | 19.9% | 18.7% | ||
| EBITDA Margin (Exc. other) | 22.1% | 20.3% | 19.6% | 18.7% | ||
| Net Income Margin | 14.8% | 11.4% | 12.6% | 11.7% | ||
| Türkiye (million TL) | 2Q24 | 2Q23 | Change % | 1H24 | 1H23 | Change % |
| Volume (million UC) | 169 | 166 | 1.8% | 287 | 278 | 3.2% |
| Net Sales | 15,721 | 16,799 | -6.4% | 27,305 | 27,381 | -0.3% |
| Gross Profit | 6,592 | 4,992 | 32.0% | 10,438 | 7,614 | 37.1% |
| EBIT | 3,382 | 5,868 | -42.4% | 6,035 | 285 | 2020.9% |
| EBIT (Exc. other) | 2,309 | 1,264 | 82.6% | 2,311 | 925 | 149.8% |
| EBITDA | 4,008 | 6,369 | -37.1% | 7,236 | 1,429 | 406.3% |
| EBITDA (Exc. other) | 2,907 | 1,895 | 53.4% | 3,557 | 2,189 | 62.5% |
| Net Income/(Loss) | 3,032 | -1,448 | n.m. | 4,840 | -6,067 | n.m. |
| Gross Profit Margin | 41.9% | 29.7% | 38.2% | 27.8% | ||
| EBIT Margin | 21.5% | 34.9% | 22.1% | 1.0% | ||
| EBIT Margin (Exc. other) | 14.7% | 7.5% | 8.5% | 3.4% | ||
| EBITDA Margin | 25.5% | 37.9% | 26.5% | 5.2% | ||
| EBITDA Margin (Exc. other) | 18.5% | 11.3% | 13.0% | 8.0% | ||
| Net Income Margin | 19.3% | n.m. | 17.7% | n.m. | ||
| International (million TL) | 2Q24 | 2Q23 | Change % | 1H24 | 1H23 | Change % |
| Volume (million UC) | 282 | 282 | 0.1% | 506 | 522 | -3.2% |
| Net Sales | 20,925 | 22,517 | -7.1% | 38,913 | 40,641 | -4.3% |
| Gross Profit | 7,402 | 8,090 | -8.5% | 13,403 | 14,314 | -6.4% |
| EBIT | 4,169 | 5,107 | -18.4% | 7,163 | 16,027 | -55.3% |
| EBIT (Exc. other) | 4,188 | 5,096 | -17.8% | 7,272 | 8,563 | -15.1% |
| EBITDA | 5,046 | 5,698 | -11.5% | 8,888 | 17,344 | -48.8% |
| EBITDA (Exc. other) | 4,908 | 5,825 | -15.7% | 8,792 | 10,025 | -12.3% |
| Net Income/(Loss) | 2,788 | 3,785 | -26.3% | 4,765 | 13,456 | -64.6% |
| Gross Profit Margin | 35.4% | 35.9% | 34.4% | 35.2% | ||
| EBIT Margin | 19.9% | 22.7% | 18.4% | 39.4% | ||
| EBIT Margin (Exc. other) | 20.0% | 22.6% | 18.7% | 21.1% | ||
| EBITDA Margin | 24.1% | 25.3% | 22.8% | 42.7% | ||
| EBITDA Margin (Exc. other) | 23.5% | 25.9% | 22.6% | 24.7% | ||
| Net Income Margin | 13.3% | 16.8% | 12.2% | 33.1% |
Acquisition of 100% in Coca-Cola Bangladesh Beverages Limited ("CCBB") was completed on February 20th, 2024, and accordingly CCBB financial results are consolidated in our financials as of 1 March 2024. Therefore, all operational performance metrics presented in this release are on a reported basis (including CCBB), except indicated otherwise. Unit case data is not within the scope of independent audit.
Following the 3.2% y/y volume decline recorded in 1Q24, CCI's consolidated volume in 2Q24 increased by 0.7% y/y, reaching 451 million unit cases ("uc"). Robust performance of Iraq and Azerbaijan; continued growth in Türkiye; and improved performance of Pakistan have paved the way for a better volume performance in the second quarter of the year. On an organic basis, excluding the impact of Bangladesh, CCI's volume would have been slightly down by 1.7%. Organic volume decline in 1Q24 was 4.1% y/y.
Category-wise, CCI continued to diversify its positioning between sparkling and the stills in line with our strategic direction. Accordingly, while sparkling volume slowed down by 1.6% y/y in 2Q24; stills volume continued its remarkable performance with 11.6% y/y improvement. This was also partly impacted by the fact that the international operations, where sparkling share is higher, had softer volumes. Consequently, the share of stills category – which includes iced teas, energy drinks and fruit juices – has further improved by 82bps y/y to 8.5% in 2Q24.
Quality mix focus continued in 2Q24 too with ongoing improvement in immediate consumption ("IC") package share and channel share. Accordingly, the share of IC packs increased by 289bps y/y in 2Q24, reaching 29.1%, on top of 133 bps improvement recorded in 2Q23. From a channel perspective, share of our volume in On-Premise increased by 53bps y/y, on top of 107bps surge realized in 2Q23.
| Change (YoY) | Breakdown | Change (YoY) | Breakdown | |||
|---|---|---|---|---|---|---|
| 2Q24 | 2Q23 | 2Q24 | 2Q23 | 1H24 | 1H24 | |
| Sparkling | -1.6% | -9.0% | 82.1% | 84.0% | -3.1% | 81.4% |
| Stills | 11.6% | -0.2% | 8.5% | 7.6% | 11.3% | 8.8% |
| Water | 14.3% | -15.2% | 9.5% | 8.3% | 8.0% | 9.8% |
| Total | 0.7% | -8.9% | 100% | 100% | -1.0% | 100% |
Totals may not add up due to rounding differences.
In 2Q24, Türkiye recorded 1.8% y/y volume growth, reaching 169 million uc. While Ramadan's pull-forward to 1Q capped y/y growth, effective trade promotions and active consumer marketing with UEFA Euro Cup activations have resulted in successful volume generation vs prior year and prior quarter. Continued focus on quality mix has yielded robust results fostering our strategic targets. Accordingly, in Türkiye, CCI recorded 5.7% y/y growth in Adult Sparkling Premium category including Schweppes; 27.2% y/y surge in Fuse Tea; 208bps y/y rise in the share of Traditional Trade and 155bps y/y improvement of IC package share – reaching 33.0%. Share of low/no sugar products in sparkling category has also advanced by 333bps y/y.
CCI recorded 0.1% y/y growth in International operations following 7.2% y/y decline in 1Q24. On an organic basis, second quarter volume was down by 3.7% y/y. Pakistan operations started to post better volume performance compared to previous four quarters. On a y/y basis, sales volume is only down by 5.1%, showing signs of normalization, considering 22.8% volume decline realized in 1Q24 y/y. Iraq and Azerbaijan continued to deliver strong results with 15.1% and 11.5% y/y growth, respectively.
In addition, our mix improvement strategies continued to deliver positive results in international operations too. Energy drinks category almost quadrupled with 3.6x y/y growth and Adult Sparkling Premium category including Schweppes posted 28.4% y/y improvement. IC share in international operations also surged by 365 bps y/y on top of 191 bps y/y expansion realized in 2Q23. In addition, the share of on-premise channel further advanced by 46 bps y/y.
In 2Q24, Uzbekistan sales volume was impacted by the introduction of excise tax as of 1st of April and high base of the same period last year. Accordingly, our volume declined by 6.6% y/y, cycling a robust 25.3% growth realized a year ago. Improved execution in the field continued to deliver strong results with cooler coverage reaching 77.3% vs 66.8% a year ago In addition, share of on-premise channel increased by 784bps y/y to 19%, the highest figure ever.
Kazakhstan, in line with our expectations, continued to be modest considering the lower consumer sentiment, move-back of foreign consumers to their countries, high base of last year and limited summer stocking - a practice that we undertake to keep up with summer demand, due to opening of our new plant. As such, we have recorded 10.2% y/y volume decline in 2Q24. The new plant in Kazakhstan will not only help with inventory management and capacity, but also create savings thanks to reduced distribution expenditures, faster delivery and better execution in the market, while generating higher production efficiencies. Despite softer volume performance, our volume market share in sparkling category has increased by 40 bps y/y as of June-end on a 12 month trailing basis vs last year.
Following the 22.8% volume reduction realized in 1Q24, Pakistan now recorded only 5.1% slow-down in 2Q24 vs same period last year – a result of both better macroeconomic environment and our commercial choices. Macroeconomic challenges continue to impact consumers' daily disposable income and affordability concerns impacting shopper preferences, yet the new economy management's actions started to show signs of improvement in inflation and consumer confidence. Accordingly, inflation in Pakistan has reduced to 12.6% as of June 2024 vs 29.4% a year ago and consumer confidence index improved by 4pp ytd. In addition, Pakistan and the IMF reached a three-year, \$7 billion aid package deal, which fosters cautious optimism for the rest of the year. In this context, we have posted 288bps y/y improvement in IC share, demonstrating our strength in daily execution.
Based on the CMB's decision dated 28 December 2023 and numbered 81/1820 and the "Implementation Guide on Financial Reporting in High Inflation Economies" published by the POA with the announcement made on 23 November 2023, issuers and capital market institutions subject to financial reporting regulations applying Turkish Accounting/Financial Reporting Standards will apply inflation accounting by applying the provisions of TAS 29, starting from their annual financial reports for the accounting periods ending as of December 31, 2023.
As of June 30, 2024, an adjustment has been made in accordance with the requirements of TAS 29 ("Financial Reporting in High Inflation Economies") regarding the changes in the general purchasing power of the Turkish Lira. TAS 29 requirements require that financial statements prepared in the currency in circulation in the economy with high inflation be presented at the purchasing power of this currency at the balance sheet date and that the amounts in previous periods are rearranged in the same way. The indexing process was carried out using the coefficient obtained from the Consumer Price Index in Turkey published by the Turkish Statistical Institute ("TUIK").
The relevant figures for the previous reporting period are rearranged by applying the general price index so that comparative financial statements are presented in the unit of measurement valid at the end of the reporting period. Information disclosed for previous periods is also presented in the measurement unit valid at the end of the reporting period.
However, certain items from our financials are also presented without inflation adjustment for information purposes in order to give an idea of our performance relative to our 2024 forecasts, which we announced at the beginning of the year and which we stated were based on the financials without inflation adjustment. These unaudited figures are clearly labelled where relevant. All financial figures without such disclosure are reported in accordance with TAS29.
| Net Sales Revenue (TL mln) | NSR per U.C. (TL) | ||||
|---|---|---|---|---|---|
| 2Q24 | YoY Change | 2Q24 | YoY Change | ||
| Türkiye | 15,721 | -6.4% | 92.9 | -8.0% | |
| International | 20,925 | -7.1% | 74.2 | -7.2% | |
| Consolidated | 36,600 | -6.9% | 81.1 | -7.6% |
| Financial Income / (Expense) (TL million) | 2Q24 | 2Q23 | 1H24 | 1H23 |
|---|---|---|---|---|
| Interest income | 333 | 274 | 681 | 495 |
| Interest expense (-) | -2,120 | -1,483 | -4,129 | -2,448 |
| FX gain / (loss) – Borrowings | -316 | -2,368 | -829 | -3,043 |
| Other | -473 | 1,884 | 460 | 2,470 |
| Financial Income / (Expense) Net | -2,576 | -1,693 | -3,817 | -2,526 |
The free cash flow was (2.4) billion TL in 1H24 vs (3.2) billion TL of 1H23. Increased financial interest payments and higher investments in financial assets amid Bangladesh acquisition, we have still improved free cash flow y/y thanks to improvement in Net Working Capital ("NWC") management. Accordingly, NWC/NSR improved from 18.0% of June'23 to 4.3% as of June'24 thanks to extended payment terms and reduced days inventory outstanding, also cycling an unusually high base due to earthquake in Türkiye last year.
Capex was 5.6 billion TL as of June 2024. 19% of the total capital expenditure was related to the Türkiye operation, while 81% was related to international operations. Capex/Sales was realized at 8.5% in the first half.
| Financial Leverage Ratios | 1H24 | 2023 |
|---|---|---|
| Net Debt / EBITDA | 0.92 | 0.82 |
| Debt Ratio (Total Fin. Debt / Total Assets) | 32% | 34% |
| Fin. Debt-to-Equity Ratio | 85% | 82% |
| Maturity Date | 2024 | 2025 | 2026 | 2027 | 2028-30 |
|---|---|---|---|---|---|
| % of total debt | 36% | 17% | 4% | 3% | 40% |
CCI is fully compliant with the regulation to implement TAS 29 (Financial Reporting in Hyperinflationary Economies) in accordance with Capital Markets Board Bulletin dated 28.12.2023 and numbered 2023/81 and therefore has presented its financials starting from the annual financial reports for the accounting periods ending on and after 31.12.2023 in line with the regulatory framework as above. The following section is presented without the impact of TAS 29 in order to allow an assessment of the material expectations/assumptions/guidance shared previously and is unaudited.
| Consolidated (million TL) | 2Q24 | 2Q23 | Change % | 1H24 | 1H23 | Change % |
|---|---|---|---|---|---|---|
| Volume (million UC) | 451 | 448 | 0.7% | 793 | 801 | -1.0% |
| Net Sales | 37,606 | 23,273 | 61.6% | 64,520 | 38,828 | 66.2% |
| Gross Profit | 14,615 | 8,134 | 79.7% | 24,496 | 13,294 | 84.3% |
| EBIT | 7,663 | 4,660 | 64.4% | 11,988 | 7,003 | 71.2% |
| EBITDA | 8,780 | 5,064 | 73.4% | 14,012 | 7,971 | 75.8% |
| Net Income/(Loss) | 3,902 | 2,388 | 63.4% | 5,486 | 3,423 | 60.3% |
| Gross Profit Margin | 38.9% | 34.9% | 38.0% | 34.2% | ||
| EBIT Margin | 20.4% | 20.0% | 18.6% | 18.0% | ||
| EBITDA Margin | 23.3% | 21.8% | 21.7% | 20.5% | ||
| Net Income Margin | 10.4% | 10.3% | 8.5% | 8.8% | ||
| Türkiye (million TL) | 2Q24 | 2Q23 | Change % | 1H24 | 1H23 | Change % |
| Volume (million UC) | 169 | 166 | 1.8% | 287 | 278 | 3.2% |
| Net Sales | 15,331 | 9,511 | 61.2% | 25,699 | 15,162 | 69.5% |
| Gross Profit | 6,784 | 3,203 | 111.8% | 11,161 | 4,968 | 124.6% |
| EBIT (Exc. other) | 2,798 | 1,185 | 136.2% | 3,928 | 1,470 | 167.3% |
| EBITDA (Exc. other) | 3,029 | 1,376 | 120.2% | 4,406 | 1,833 | 140.4% |
| Net Income/(Loss) | 1,358 | -1,200 | n.m. | 1,940 | -4,579 | n.m. |
| Gross Profit Margin | 44.2% | 33.7% | 43.4% | 32.8% | ||
| EBIT Margin (Exc. other) | 18.3% | 12.5% | 15.3% | 9.7% | ||
| EBITDA Margin (Exc. other) | 19.8% | 14.5% | 17.1% | 12.1% | ||
| Net Income Margin | 8.9% | n.m. | 7.5% | n.m. | ||
| International operations (million TL) | 2Q24 | 2Q23 | Change % | 1H24 | 1H23 | Change % |
| Volume (million UC) | 282 | 282 | 0.1% | 506 | 522 | -3.2% |
| Net Sales | 22,319 | 13,762 | 62.2% | 38,913 | 23,684 | 64.3% |
| Gross Profit | 7,867 | 4,934 | 59.5% | 13,403 | 8,339 | 60.7% |
| EBIT (Exc. other) | 4,427 | 3,092 | 43.2% | 7,272 | 4,988 | 45.8% |
| EBITDA (Exc. other) | 5,209 | 3,542 | 47.0% | 8,792 | 5,840 | 50.5% |
| Net Income/(Loss) | 2,942 | 2,547 | 15.5% | 4,765 | 7,845 | -39.3% |
| Gross Profit Margin | 35.2% | 35.9% | 34.4% | 35.2% | ||
| EBIT Margin (Exc. other) | 19.8% | 22.5% | 18.7% | 21.1% | ||
| EBITDA Margin (Exc. other) | 23.3% | 25.7% | 22.6% | 24.7% | ||
| Net Income Margin | 13.2% | 18.5% | 12.2% | 33.1% | ||
The forward looking guidance below is given on an organic basis and without any potential impact from the implementation of TAS 29 (Financial Reporting in Hyperinflationary Economies) and may change as per TAS 29. In order to provide a comparison with our previously shared guidance on Jan 8th 2024, we again release the below guidance based on historical figures (i.e. without TAS 29).
We revise our full year guidance on volume from "mid-single-digit growth" to "flat-to-lowsingle-digit growth" on the back of lower purchasing power expectation and cautious consumer sentiment both reflecting the combination of lingering economic challenges with sensitivities resulting from the on-going conflict in the Middle East.
We are committed to creating quality value through investing ahead of demand in our geographies, executing effectively in the store, implementing Revenue Growth Management (RGM) actions and robust marketing plans. Our focus remains intact: "over time growing per capita NARTD consumption and creating value through our Quality Growth Algorithm (EBITDA growth > Revenue Growth > Transaction growth > Volume growth)." Accordingly, in order to find the optimal balance between volume and value growth, we are cautious in taking price increases in this macroeconomically challenging environment and we rely more heavily on other RGM actions to deliver top line growth. Nevertheless, with revised volume guidance and slower than initially planned price increases, we also revise our FX-neutral Net Sales Revenue growth guidance to "low 30% growth" from "low 40s% growth".
Timely hedges resulting in tight COGS control combined with relentless focus on strict opex management enable us to deliver value in this challenging environment. Despite lower volume and our cautious stance on price increases, we will put relentless effort to deliver in line with our previous EBIT margin guidance of "flat vs previous year". We do, however, see risk of a slight decline in EBIT margin vs previous year, if the operating environment deteriorates further. Incorporating this potential risk to our guidance, we amend our EBIT margin guidance as "slight decline to flat vs last year".
Our company's expectations for 2024 are as follows (on an organic basis and without any potential impact from the implementation of inflation accounting):
Flat-to-Low-single-digit volume growth on a consolidated basis;
Low 30s percentage FX-neutral NSR growth
Slight-decline-to-Flat vs previous year
The consolidated financial statements and disclosures have been prepared in accordance with the communiqué numbered II-14,1 "Communiqué on the Principles of Financial Reporting in Capital Markets. In accordance with article 5 of the CMB Accounting Standards, companies should apply Turkish Accounting Standards / Turkish Financial Reporting Standards ("TAS" / "TFRS") and interpretations regarding these standards as adopted by the Public Oversight Accounting and Auditing Standards Authority ("POA").
As of June 30, 2024, the list of CCI's subsidiaries and joint ventures is as follows:
| Subsidiaries and Joint Ventures | Country | Consolidation Method |
|---|---|---|
| Coca-Cola Satış ve Dağıtım A.Ş. | Türkiye | Full Consolidation |
| JV Coca-Cola Almaty Bottlers LLP | Kazakhstan | Full Consolidation |
| Azerbaijan Coca-Cola Bottlers LLC | Azerbaijan | Full Consolidation |
| Coca-Cola Bishkek Bottlers Closed J. S. Co. | Kyrgyzstan | Full Consolidation |
| CCI International Holland BV. | Holland | Full Consolidation |
| The Coca-Cola Bottling Company of Jordan Ltd | Jordan | Full Consolidation |
| Turkmenistan Coca-Cola Bottlers | Turkmenistan | Full Consolidation |
| Sardkar for Beverage Industry Ltd |
Iraq | Full Consolidation |
| Waha Beverages BV. | Holland | Full Consolidation |
| Coca-Cola Beverages Tajikistan LLC | Tajikistan | Full Consolidation |
| Al Waha LLC | Iraq | Full Consolidation |
| Coca-Cola Beverages Pakistan Ltd | Pakistan | Full Consolidation |
| Coca-Cola Bottlers Uzbekistan Ltd | Uzbekistan | Full Consolidation |
| CCI Samarkand Ltd LLC | Uzbekistan | Full Consolidation |
| CCI Namangan Ltd LLC | Uzbekistan | Full Consolidation |
| Anadolu Etap Penkon Gıda ve İçecek Ürünleri A. Ş | Türkiye | Full Consolidation |
| Syrian Soft Drink Sales and Distribution LLC | Syria | Equity Method |
| Coca-Cola Bangladesh Beverages Ltd. | Bangladesh | Full Consolidation |
The Company's "Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)" definition and calculation is defined as; "Profit/(loss) from operations" plus relevant non-cash expenses including depreciation and amortization, provision for employee benefits like retirement and vacation pay (provision for management bonus not included) and other noncash expenses like negative goodwill and value increase due to change in scope of consolidation. As of June 30, 2024, and June 30, 2023, the reconciliation of EBITDA to profit / (loss) from operations is explained in the following table:
| EBITDA (TL million) | ||||
|---|---|---|---|---|
| TAS 29 (Financial Reporting in Hyperinflationary Economies) implemented | 2Q24 | 2Q23 | 1H24 | 1H23 |
| Profit / (loss) from operations | 6,896 | 7,000 | 10,378 | 10,419 |
| Depreciation and amortization | 1,193 | 1,183 | 2,454 | 2,385 |
| Provision for employee benefits | 77 | 111 | 209 | 212 |
| Foreign exchange gain / (loss) under other operating income / (expense) | 105 | -405 | 14 | -421 |
| Right of use asset amortization | 48 | 65 | 104 | 129 |
| EBITDA | 8,318 | 7,955 | 13,157 | 12,724 |
Totals may not foot due to rounding differences.
Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. All differences are recorded in the consolidated income statement of the relevant period, as foreign currency loss or gain. Foreign currency translation rates announced by the Central Bank of the Republic of Turkey used by the Group's subsidiaries in Turkey. USD amounts presented in the asset accounts are translated into TL with the official TL exchange rate of USD buying on June 30, 2024, USD 1,00 (full) = TL 32,8262 (December 31, 2023; USD 1,00 (full) = TL 29,4382) whereas USD amounts in the liability accounts are translated into TL with the official TL exchange rate of USD selling on June 30, 2024, USD 1,00 (full) = TL 32,8853 (December 31, 2023; USD 1,00 (full) = TL 29,4913). Furthermore, USD amounts in the income statement are translated into TL, at the average TL exchange rate for USD buying for the period is USD 1,00 (full) = TL 31,6040 (January 1 - June 30, 2023; USD 1,00 (full) = TL 19,8612).
| 1H24 | 1H23 |
|---|---|
| 31,6040 | 19,8612 |
| 32,8262 | 25,8231 |
| 32,8853 | 25,8696 |
The assets and liabilities of subsidiaries and joint ventures operating in foreign countries are translated at the rate of exchange ruling at the balance sheet date and the income statements of foreign subsidiaries and joint ventures are translated at average exchange rates. Differences that occur in the usage of closing and average exchange rates are followed under currency translation differences classified under equity.
| Reviewed | ||||||
|---|---|---|---|---|---|---|
| January 1 - June 30 | April 1 - June 30 | |||||
| (TL million) | 2024 | 2023 | Change (%) | 2024 | 2023 | Change (%) |
| Sales Volume (UC millions) | 793 | 801 | -1.0% | 451 | 448 | 0.7% |
| Revenue | 66,119 | 67,988 | -2.7% | 36,600 | 39,315 | -6.9% |
| Cost of Sales | -42,353 | -46,092 | -8.1% | -22,645 | -26,239 | -13.7% |
| Gross Profit from Operations | 23,766 | 21,896 | 8.5% | 13,956 | 13,075 | 6.7% |
| Distribution, Selling and Marketing Expenses |
-10,239 | -9,309 | 10.0% | -5,481 | -5,056 | 8.4% |
| General and Administrative Expenses | -3,317 | -2,588 | 28.2% | -1,692 | -1,401 | 20.8% |
| Other Operating Income | 1,587 | 2,055 | -22.7% | 868 | 1,532 | -43.3% |
| Other Operating Expense | -1,419 | -1,634 | -13.2% | -755 | -1,150 | -34.4% |
| Profit/(Loss) from Operations | 10,378 | 10,419 | -0.4% | 6,896 | 7,000 | -1.5% |
| Gain/(Loss) From Investing Activities | -26 | -80 | 67.2% | -8 | -107 | 92.1% |
| Gain/(Loss) from Associates | -3 | -19 | 81.8% | -1 | -2 | 37.0% |
| Profit/(Loss) Before Financial Income/(Expense) |
10,348 | 10,321 | 0.3% | 6,886 | 6,891 | -0.1% |
| Financial Income | 1,878 | 5,233 | -64.1% | 505 | 3,169 | -84.1% |
| Financial Expenses | -5,695 | -7,759 | -26.6% | -3,081 | -4,862 | -36.6% |
| Monetary Gain /(Loss) | 5,213 | 4,424 | 17.8% | 2,462 | 1,949 | 26.3% |
| Profit/(Loss) Before Tax | 11,743 | 12,218 | -3.9% | 6,773 | 7,147 | -5.2% |
| Deferred Tax Income/(Expense) | 270 | -1,095 | n.m. | 429 | -1,114 | n.m. |
| Current Period Tax Expense | -3,616 | -2,825 | 28.0% | -1,741 | -1,254 | 38.9% |
| Net Income/(Loss) Before Minority | 8,398 | 8,298 | 1.2% | 5,460 | 4,779 | 14.3% |
| Minority Interest | -45 | -350 | -87.0% | -52 | -278 | -81.3% |
| Net Income | 8,352 | 7,948 | 5.1% | 5,408 | 4,501 | 20.2% |
| EBITDA | 13,158 | 12,724 | 3.4% | 8,318 | 7,955 | 4.6% |
| January 1 - June 30 | April 1 - June 30 | |||||
|---|---|---|---|---|---|---|
| (TL million) | 2024 | 2023 | Change (%) | 2024 | 2023 | Change (%) |
| Sales Volume (UC millions) | 287 | 278 | 3.2% | 169 | 166 | 1.8% |
| Revenue | 27,305 | 27,381 | -0.3% | 15,721 | 16,799 | -6.4% |
| Cost of Sales | -16,867 | -19,767 | -14.7% | -9,128 | -11,806 | -22.7% |
| Gross Profit from Operations | 10,438 | 7,614 | 37.1% | 6,592 | 4,992 | 32.0% |
| Distribution, Selling and Marketing Expenses |
-5,936 | -4,959 | 19.7% | -3,141 | -2,782 | 12.9% |
| General and Administrative Expenses | -2,190 | -1,730 | 26.6% | -1,143 | -947 | 20.7% |
| Other Operating Income | 4,484 | 7,739 | -42.1% | 1,518 | 5,491 | -72.3% |
| Other Operating Expense | -761 | -8,379 | -90.9% | -445 | -887 | -49.8% |
| Profit/(Loss) from Operations | 6,035 | 285 | 2020.9% | 3,382 | 5,868 | -42.4% |
| Gain/(Loss) From Investing Activities | -25 | -124 | -79.4% | -7 | -151 | -95.5% |
| Gain/(Loss) from Associates | 0 | 0 | n.m. | 0 | 0 | n.m. |
| Profit/(Loss) Before Financial Income/(Expense) |
6,010 | 161 | 3632.3% | 3,375 | 5,717 | -41.0% |
| Financial Income | 1,461 | 2,713 | -46.1% | 310 | 2,278 | -86.4% |
| Financial Expenses | -6,848 | -13,362 | -48.8% | -2,666 | -11,744 | -77.3% |
| Monetary Gain /(Loss) | 5,213 | 4,424 | 17.8% | 2,462 | 1,949 | 26.3% |
| Profit/(Loss) Before Tax | 5,836 | -6,065 | n.m. | 3,481 | -1,800 | n.m. |
| Deferred Tax Income/(Expense) | 762 | 757 | 0.7% | 472 | 594 | -20.5% |
| Current Period Tax Expense | -1,752 | -719 | 143.7% | -904 | -202 | 346.7% |
| Net Income/(Loss) Before Minority | 4,846 | -6,027 | n.m. | 3,049 | -1,408 | n.m. |
| Minority Interest | -6 | -40 | -84.1% | -18 | -40 | -55.5% |
| Net Income | 4,840 | -6,067 | n.m. | 3,032 | -1,448 | n.m. |
| EBITDA | 7,236 | 1,429 | 406.3% | 4,008 | 6,369 | -37.1% |
| Reviewed | ||||||
|---|---|---|---|---|---|---|
| January 1 - June 30 | April 1 - June 30 | |||||
| (TL million) | 2024 | 2023 | Change (%) | 2024 | 2023 | Change (%) |
| Sales Volume (UC millions) | 506 | 522 | -3.2% | 282 | 282 | 0.1% |
| Revenue | 38,913 | 40,641 | -4.3% | 20,925 | 22,517 | -7.1% |
| Cost of Sales | -25,510 | -26,327 | -3.1% | -13,523 | -14,428 | -6.3% |
| Gross Profit from Operations | 13,403 | 14,314 | -6.4% | 7,402 | 8,090 | -8.5% |
| Distribution, Selling and Marketing Expenses |
-4,303 | -4,351 | -1.1% | -2,340 | -2,274 | 2.9% |
| General and Administrative Expenses | -1,829 | -1,400 | 30.7% | -874 | -720 | 21.5% |
| Other Operating Income | 549 | 8,065 | -93.2% | 289 | 274 | 5.6% |
| Other Operating Expense | -658 | -601 | 9.4% | -309 | -263 | 17.3% |
| Profit/(Loss) from Operations | 7,163 | 16,027 | -55.3% | 4,169 | 5,107 | -18.4% |
| Gain/(Loss) From Investing Activities | -1 | 44 | n.m. | -2 | 44 | n.m. |
| Gain/(Loss) from Associates | -3 | -19 | 81.8% | -1 | -2 | 37.0% |
| Profit/(Loss) Before Financial Income/(Expense) |
7,159 | 16,052 | -55.4% | 4,166 | 5,149 | -19.1% |
| Financial Income | 469 | 2,561 | -81.7% | 220 | 911 | -75.8% |
| Financial Expenses | -1,327 | -2,930 | -54.7% | -791 | -981 | -19.4% |
| Profit/(Loss) Before Tax | 6,300 | 15,682 | -59.8% | 3,596 | 5,078 | -29.2% |
| Deferred Tax Income/(Expense) | 58 | -162 | n.m. | 12 | -159 | n.m. |
| Current Period Tax Expense | -1,554 | -1,754 | -11.4% | -785 | -897 | -12.5% |
| Net Income/(Loss) Before Minority | 4,804 | 13,767 | -65.1% | 2,823 | 4,023 | -29.8% |
| Minority Interest | -39 | -310 | -87.4% | -34 | -238 | -85.7% |
| Net Income | 4,765 | 13,456 | -64.6% | 2,788 | 3,785 | -26.3% |
| EBITDA | 8,888 | 17,344 | -48.8% | 5,046 | 5,698 | -11.5% |
| (TL million) | Reviewed | Audited |
|---|---|---|
| June 30 2024 | December 31 2023 | |
| Current Assets | 69,632 | 60,190 |
| Cash and Cash Equivalents | 22,752 | 27,136 |
| Investments in Securities | 2,770 | 469 |
| Trade Receivables | 22,452 | 10,995 |
| Other Receivables | 287 | 150 |
| Derivative Financial Instruments | 184 | 176 |
| Inventories | 16,180 | 16,194 |
| Prepaid Expenses | 3,008 | 2,328 |
| Tax Related Current Assets | 465 | 792 |
| Other Current Assets | 1,532 | 1,950 |
| Non-Current Assets | 78,372 | 77,215 |
| Other Receivables | 159 | 168 |
| Property, Plant and Equipment | 47,117 | 43,950 |
| Goodwill | 5,485 | 5,794 |
| Intangible Assets | 22,165 | 24,074 |
| Right of Use Asset | 532 | 676 |
| Prepaid Expenses | 1,354 | 1,518 |
| Deferred Tax Asset | 1,522 | 724 |
| Derivative Financial Instruments | 38 | 42 |
| Other Non-Current Assets | 0 | 269 |
| Total Assets | 148,004 | 137,406 |
| Current Liabilities | 62,296 | 51,775 |
| Short-term Borrowings | 9,238 | 10,644 |
| Current Portion of Long-term Borrowings | 11,799 | 11,887 |
| Bank borrowings | 11,600 | 11,643 |
| Finance lease payables | 199 | 244 |
| Trade Payables | 31,093 | 23,196 |
| Due to related parties | 12,095 | 9,593 |
| Other trade payables to third parties | 18,998 | 13,603 |
| Payables Related to Employee Benefits | 513 | 451 |
| Other Payables | 5,854 | 3,111 |
| Due to related parties | 258 | 288 |
| Other payables to third parties | 5,596 | 2,822 |
| Derivative Financial Instruments | 369 | 347 |
| Deferred Income | 289 | 256 |
| Provision for Corporate Tax | 1,827 | 510 |
| Current Provisions | 1,187 | 1,205 |
| Other Current Liabilities | 128 | 167 |
| Non-Current Liabilities | 30,915 | 29,556 |
| Long-term Borrowings | 25,200 | 23,091 |
| Financial lease payables | 455 | 579 |
| Trade Payables | 3 | 6 |
| Provision for Employee Benefits | 846 | 913 |
| Deferred Tax Liability | 4,385 | 4,908 |
| Derivative Financial Instruments Deferred Income |
0 25 |
4 55 |
| Equity of the Parent | 47,487 | 49,004 |
| Minority Interest | 7,306 | 7,070 |
| Total Liabilities | 148,004 | 137,406 |
| Reviewed | ||
|---|---|---|
| (TL million) | Period End | |
| June 30 2024 | June 30 2023 | |
| Cash Flow from Operating Activities | ||
| IBT Adjusted for Non-cash items | 10,596 | 11,848 |
| Change in Tax Assets and Liabilities | -2,057 | -1,407 |
| Employee Term. Benefits, Vacation Pay, Management Bonus Payment |
-213 | -208 |
| Change in other current and non-current assets and liabilities | -2,129 | -6,698 |
| Change in Operating Assets & Liabilities | -67 | -913 |
| Net Cash Provided by Operating Activities | 6,130 | 2,624 |
| Purchase of Property, Plant & Equipment | -5,319 | -4,236 |
| Other Net Cash Provided by/ (Used in) Investing Activities | -2,547 | -1,348 |
| Cash inflow/outflow from acquisition of subsidiary | -814 | -3,746 |
| Net Cash Used in Investing Activities | -8,680 | -9,330 |
| Interest Paid | -3,673 | -1,850 |
| Interest Received | 673 | 495 |
| Change in ST & LT Loans | 4,010 | 4,822 |
| Dividends paid (including non-controlling interest) | -2,104 | -1,340 |
| Cash flow hedge reserve | -244 | 10 |
| Change in finance lease payables | -172 | -240 |
| Net Cash Provided by / (Used in) Financing Activities | -1,510 | 1,898 |
| Currency Translation Differences | 420 | 5,478 |
| Monetary gain / loss on cash and cash equivalents | -744 | -266 |
| Net Change in Cash & Cash Equivalents | -4,384 | 404 |
| Cash & Cash Equivalents at the beginning of the period | 27,136 | 28,792 |
| Cash & Cash Equivalents at the end of the period | 22,752 | 29,196 |
| Free Cash Flow | -2,360 | -3,207 |
Totals may not foot due to rounding differences.
| Investor Contacts: | Media Contacts: | |
|---|---|---|
| Çiçek Uşaklıgil Özgüneş | Burçun İmir | |
| Investor Relations and Treasury Director | Chief Corporate Affairs and Sustainability Officer | |
| Tel: +90 216 528 4002 | Tel: +90 216 528 4209 | |
| E-mail: [email protected] | E-mail: [email protected] | |
| Melda Öztoprak | ||
| Investor Relations Senior Manager | ||
| Tel: +90 216 528 4367 | ||
| E-mail: [email protected] | ||
| Tuğçe Tarhan | Selim Çiriş | |
| Investor Relations Executive | Investor Relations Analyst | |
| Tel: +90 216 528 4119 | Tel: +90 216 528 4324 | |
| E-mail: [email protected] | [email protected] |
CCI is a multinational beverage company which operates in Türkiye, Pakistan, Kazakhstan, Iraq, Uzbekistan, Bangladesh, Azerbaijan, Kyrgyzstan, Jordan, Tajikistan, Turkmenistan, and Syria. CCI produces, distributes and sells sparkling and still beverages of The Coca-Cola Company and Monster Energy Beverage Corporation along with the production of fruit juice concentrate via its affiliate Anadolu Etap İçecek (Anadolu Etap Penkon Gıda ve İçecek Ürünleri Sanayi ve Ticaret Anonim Şirket).
CCI employs more than 10,000 people, has a total of 33 bottling plants, and 3 fruit processing plants in 12 countries, offering a wide range of beverages to a population base of 600 million people. In addition to sparkling beverages, the product portfolio includes juices, waters, sports and energy drinks, iced teas and coffee.
CCI's shares are traded on the Borsa Istanbul Stock Exchange (BIST) under the symbol "CCOLA.IS".
Reuters: CCOLA.IS Bloomberg: CCOLA.TI
17 This document contains forward-looking statements including, but not limited to, statements regarding Coca-Cola İçecek's (CCI) plans, objectives, expectations and intentions and other statements that are not historical facts. Forward-looking statements can generally be identified by the use of words such as "may," "will," "expect," "intend," "estimate," "anticipate," "plan," "target," "believe" or other words of similar meaning. These forward-looking statements reflect the current views and assumptions of management and are inherently subject to significant business, economic and other risks and uncertainties. Although management believes the expectations reflected in the forward-looking statements are reasonable, at this time, you should not place undue reliance on such forward-looking statements. Important factors that could cause actual results to differ materially from CCI's expectations include, without limitation: changes in CCI's relationship with The Coca-Cola Company and its exercise of its rights under our bottler's agreements; CCI's ability to maintain and improve its competitive position in its markets; CCI's ability to obtain raw materials and packaging materials at reasonable prices; changes in CCI's relationship with its significant shareholders; the level of demand for its products in its markets; fluctuations in the value of the Turkish Lira and currencies in CCI's other markets; the level of inflation in Türkiye and CCI's other markets; other changes in the political or economic environment in Türkiye or CCI's other markets; adverse weather conditions during the summer months; changes in the level of tourism in Türkiye; CCI's ability to successfully implement its strategy; and other factors. Should any of these risks and uncertainties materialize or should any of management's underlying assumptions prove to be incorrect, CCI's actual results from operations or financial conditions could differ materially from those described herein as anticipated, believed, estimated, or expected. Forward-looking statements speak only as of the date of this press release and CCI has no obligation to update those statements to reflect changes that may occur after that date.
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