Coca Cola Amalti Case Analysis

Financial Summary

The table below shows the Financial Results of Coca Cola Amalti, the last past 5 years: 2010

$M 2011

$M 2012

$M 2013

$M 2014

$M

Trading revenue $4,490.3 $4,801.2 $5,097.4 $5036.4 $4942.8

EBIT $844.9 $870.50 $761.0 $367.9 $507.1

Net Profit $497.3 $591.8 $460.1 $80.6 $272.8

Operating cash flow $585.4 641.8 $741.9 $733.1 $590.2

In the past 3 years the earnings of CCA business dropped, its happened because of the restructuring in they activities, and the competitive market position and the difficult in the conditions of trading.

The strategic review identified numbers of priorities for the business, to be focused around commencing the rebalancing of pricing across channels, increasing the level of marketing spend to support

That’s a long way from the lofty highs of nearly $16 reached in 2012 and means that anyone who bought shares over the last five years will be sitting on a capital loss. (“Fool, fool.com.au”. 2014)

The Coca-Cola company is expecting that the earnings was going to be around 25% lower than the year before, that means that the company is currently trading on a forward price to earnings ratio of 17 and dividend yield of 4.9%.The CCA expect the earnings and the dividends per share must arise.

The Australian food and beverage, the giant Coca-Cola Amatil (CCA), announced dropped in trading revenue of 1.9 per cent to $4.9 billion, and a decrease in earnings before interest and tax (EBIT) of 21.8 per cent to $651.5 million for the year ended 31 December 2014. (“CCL, COCA COLA”. 2014).

CCA’s Group Managing Director Alison Watkin, joined the company in 2013, believes that the Company’s earnings had come under because the significant pressure in recent years, driven by structural changes in the marketplace. In according with the director, 2014 was a year of transition with solid progress, developing and implementing, to range of initiatives and stabilize earnings and return the business to

It’s a new strategic of review. The review was conducted in response to deteriorating market conditions across the Group with the objective of restoring CCA to sustainable earnings growth. The results in August 2014 were a profit of $182.3 million for the first half of 2014, a drop of 19 per cent compared to the previous year before significant items. CCA had developed plan that’s reflects the following strategic themes:

• Strengthening the company category leadership for each of the market;

• Making a step change in the productivity and in-market execution; and

• Building better align with the Coca-Cola Company.

CCA announced a heads of agreement with its parent company Coca-Cola to accelerate growth Indonesia’s strategy. That agreement will cost an investment of US$500 million into the Indonesian business. The Indonesian is subsidiary of CCA, in return for an ordinary equity ownership interest of 29.4 per cent”. (“COCA-COLA AMATIL”.2015)

“The results, in 2014, shows that the Australian beverage business earnings declined 21.3% with the business commencing, the activities target of strengthening to achieve the competitive position against the trading