Coca-Cola Amatil Share Price Up on Higher Volumes (ASX:CCL)

The Coca-Cola Amatil Ltd [ASX:CCL] share price was up slightly today after the ASX 200 company released a market update.

CCL is one of the largest bottling companies in the Asia-Pacific region. It is also one of the largest bottlers of Coca-Cola products.

In Australia, CCL saw better volumes during the Christmas period

For the fourth quarter of 2020, the company saw 0.4% volume growth in Australia — an improvement on the three previous quarters of the year in which volume change had been negative. However, even with the last quarter’s growth, volumes in Australia resulted in an overall 4.2% contraction for the year.

Most of the large declines in volume were in Fiji and Indonesia. The company has been struggling with the pandemic in Indonesia in particular.

As group managing director Alison Watkins said:

Whilst we are encouraged by recent trading in Australia and particularly in New Zealand, month to month volatility remains. This is particularly the case in Australia, where On-the-Go (OTG) trading can vary considerably by state depending on the prevailing COVID-19 restrictions and related sentiment at any given point in time.

Our Indonesian business continues to face challenging trading conditions, with COVID-19 infection rates remaining high and tough macro-economic conditions prevailing.

For the full 2020 fiscal year the group saw an 8.4% decrease in volume compared to the previous year. The company also suffered a 6.1% drop in revenue, with total revenue for the year at $4.76 billion.

What could happen next for CCL?

The company expects that earnings for FY20 will be $550.7 million, a 13.9% decrease from the previous year, and net profit to be $340.3 million.

Markets have taken the news well. At time of writing, the share price was up 0.70% and trading at $13. The share price collapsed in March but has slowly recovered since.

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Selva Freigedo,

For The Rum Rebellion

Selva Freigedo is a research analyst for The Rum Rebellion.

Born in Argentina, her passion for economic analysis started at a young age. Her father was an economist for the Argentinean governments and the family used to discuss politics and economics at the dinner table.

Argentina is a country with an unusual economic history. Growing up there gave Selva first-hand experience on different economic phenomena such as hyperinflation, devaluation and debt default.

Selva has also lived in Brazil, Spain and the USA.

Back in 2000 she was living in the US as the dot com bubble popped…
And in 2008 she was in Spain as the property market exploded and then collapsed…

She has seen first-hand what happens when bubbles burst.

Selva joined Fat Tail Investment Research’s team in 2016, as an analyst. She now writes from her vantage point in Australia, where she settled in 2015.

The Rum Rebellion