Coca-Cola Enterprises Inc (NYSE:CCE) shares were down after the bottling firm lowered their second quarter outlook. Management warned that the continuing financial crisis in Europe, bad weather, a hike in the excise tax in France and intensifying competition in Britain are responsible for a dampened outlook.
In the morning trade on the New York Stock Exchange stocks of the European bottling firm were down 3 percent to $36.06. On Monday, shares closed at $37.16 and were inactive in the pre-market trading. Year to date, the stocks are up 17 percent.
Details to Come
Chief Executive John Brock replied that some of the challenging factors may fade away as the company moves forward through the year. The full year's impact of factors will be clear only after analyzing responses in the “prime summer selling season.”
According to Brock, some of the factors are “unexpectedly persistent” and may block the company’s progress in the upcoming quarter. These issues will be discussed in detail by the management at Deutsche Bank Global Consumer Conference in Paris later Tuesday.
“Despite these current challenges, we will continue to manage each lever of our business, drive strong free cash flow, and remain focused on our ultimate objective – driving value for our shareowners” Mr. Brock said.
Coca-Cola Enterprises Q1 Earnings
Coca-Cola Enterprises Inc (NYSE:CCE) was carved out of Coca-Cola Co. in 1986 to focus on independent bottling. The bottler has been pursuing restructuring efforts to save on costs. The company has also increased its focus on finance back-office function and a go-to-market model.
For the first quarter, the company reported a 44 percent fall in earnings owing to a depressed macro environment. Profits came in at $61 million, or 21 cents a share, down from $109 million, or 35 cents a share, a year earlier. Excluding one-time items, earnings rose to 39 cents from 36 cents. Analyst estimated earnings of 38 cents a share on revenue of $1.9 billion. Gross margins were down marginally to 34.3 percent from 35.2 percent. Volume in continental Europe was down 3 percent while, in Great Britain, it was up 1 percent.
In April, the bottling firm forecasted full year earnings to grow by 11-12 percent and sales to grow in low- to mid-single digit range. The company informed that an update on the remaining of the year will be provided during the second quarter earnings call on July 25.