Coca-Cola Amatil shares were on the nose yesterday in the upbeat trading conditions, despite the drinks giant reporting a 16.4% improvement in profit for the year to last December.
As well the group boosted final dividend for a 11.50% rise in payout for the year.
Despite the good news, the shares closed off 2.5%, or 27c at $10.57 as investors took profits in a robust day of trading.
It seems that once again investors and analysts had gotten ahead of themselves and expected a better result from the company and a more bullish outlook.
The company again signalled that it is expecting earnings growth in the first half of calendar 2010 "in the high single digits", which has been its forecast for the past couple of years for the start of the new year.
Coca Cola Amatil said the net profit of $449 million for 2009 was a record.
It compares with the $385.6 million in the previous year.
Before significant items, net profit was up 11.1% to $449 million, on trading revenue growth for the year of 7.6% to $4.40 billion.
Earnings before interest and tax (EBIT) rose 0.3% to $787.3 million.
The company declared a final dividend of 25 cents, fully franked, up from 22 cents in the prior year.
That took total payout for the year to 43.5c a year, up from 39c a share in 2008.
Coca-Cola Amatil said it "delivered a record result for the 2009 full year," in its statement to the ASX.
It expects "high single-digit earnings growth for the first half of 2010… assuming a continuation of current trading conditions".
CC Amatil managing director Terry Davis said in the statement that the result reflected a "strong performance in what were challenging trading conditions".
"The significant investments made by the company over the last three years in capacity, operational capability and cold drink coolers, as well as successful new product and package innovation, continues to distinguish the performance of CCA from its food and beverage peer group," Mr Davis said.
He said year highlights included strong performances by the Indonesia and PNG and Australian Beverage businesses, a recovery in the second half by the New Zealand business and earnings growth of more than 20% by the company’s Food & Services Division (which includes the Ardmona fruit group and Grinders Coffee).
Mr Davis said the Australian beverage result had been driven by successful new product and package innovation, increased cold drink availability and higher levels of customer service.
"Whilst we experienced some trading down in the first half in high-end restaurants and cafes, this was offset by improved product mix and increased demand in quick service restaurants and supermarkets for at-home consumption," Mr Davis said.
"Demand for single-serve beverages has remained strong throughout the year due to the success of CCA’s cold drink cooler renewal program."
Mr Davis said the company had identified a strong pipeline of revenue generating and cost saving capital projects over the next three years, including the self manufacture of PET bottles in Australia and Indonesia, a material increase in beverage production capacity and the accelerated placement of cold drink coolers across the Group, and commissioning a brewery for boutique brewer, Bluetongue.
"All of these projects will drive short and medium term earnings growth," Mr Davis said in the statement.
"The decision to maintain our up-weighted capital investment program through the global financial crisis in order to reduce operating costs and materially improve customer service levels has again provided the platform for increased business, leading to higher returns for our shareholders."
“The decision to maintain our up-weighted capital investment program through the global financial crisis in order to reduce operating costs and materially improve customer service levels has again provided the platform for increased business, leading to higher returns for our shareholders,” Mr. Davis said.
"In Indonesia, CCA will materially increase its investments in one-way pack production capacity and cold drink coolers in order to drive strong volume and revenue growth in 2010."
The company said "the impact of the higher Australian dollar on the translation of CCA’s overseas earnings reduced CCA’s 2009 reported earnings growth (EBIT and NPAT) by approximately 1.4%."
The company says it will deliver a trading and profit update for the first half of 2010 at its annual general meeting on Friday, May 14 2010.
Pizza goes with fizzy drinks of the sort sold by Coca Cola Amatil, so it is probably not is much of a surprise that pizza chain Domino’s has reported a 39% increase in first half net profit after strong sales growth and upgraded its guidance for the full year.
Domino’s posted net profit of $8.745 million for the six months to January 3, 2010, up from $6.283 million in the prior corresponding period.
Total Network Sales of $353.5 million, increased 7.6% from the first half of 2009.
Operating revenue increased 5.3% to $119.405 million, while same store sales across the group rose by 2.9%, indicating a sharp improvement in margins.
The company declared an interim dividend of six cents per share, up from 4.4 cents per share in the prior corresponding period.
The shares rose 5c to $5.15 yesterday, a bit less than the 2% rise in the wider marke
