- CCE achieved full-year earnings per
diluted share of $2.63 on a reported basis, up 8 percent, or $2.85
on a comparable basis, up 13½ percent and up 11 percent on a
comparable and currency-neutral basis.
- Full-year net sales totaled $8.3
billion, an increase of ½ percent on a reported basis, or down ½
percent on a currency-neutral basis; volume was flat and net
pricing per case declined ½ percent.
- Full-year operating income was $1.0
billion on a reported basis, up 11½ percent, or $1.1 billion on a
comparable basis, up 5 percent and up 3 percent on a comparable and
currency-neutral basis.
- Fourth-quarter earnings per diluted
share totaled 46 cents on a reported basis, or 58 cents on a
comparable basis.
- CCE affirms its expectation for 2015
comparable and currency-neutral earnings per diluted share growth
in a range of 6 percent to 8 percent; at recent rates, currency
translation would reduce earnings per diluted share by
approximately 16 percent.
Regulatory News:
Coca-Cola Enterprises, Inc. (NYSE: CCE)(Euronext Paris:
CCE) today reported full-year 2014 earnings per diluted share of
$2.63, or $2.85 on a comparable basis. Currency translation had a
positive impact of approximately 6 cents on full-year comparable
earnings per diluted share.
Reported operating income for the year totaled $1.0 billion;
comparable operating income totaled $1.1 billion, up 5 percent and
up 3 percent on a comparable and currency-neutral basis versus a
year ago. Items affecting comparability are detailed on pages 11
through 14 of this release.
Reported earnings per diluted share for the fourth quarter were
46 cents, or 58 cents on a comparable basis. Currency translation
had a negative impact of approximately 5 cents on fourth-quarter
comparable earnings per diluted share.
“Throughout 2014, persistent macroeconomic and marketplace
headwinds continued to affect our business and our top-line
growth,” said John F. Brock, chairman and chief executive officer.
“While this impacted our ability to achieve our full-year net sales
and operating income objectives, we adjusted our plans, focused on
generating strong free cash flow, and achieved our earnings per
share growth objective.
“As we go forward into 2015, we will continue to adapt to these
operating conditions, with a solid emphasis on innovation in every
aspect of our business,” Mr. Brock said. “We will remain flexible
in our approach and continue to manage each element of our business
to deliver on our most important objective, creating value for our
shareowners.”
OPERATING REVIEW
For the full year, total volume was flat. Sparkling drinks
declined ½ percent, including flat volume for our total Coca-Cola
trademark brands. Coca-Cola Zero contributed substantial growth of
11 percent for the year. Sparkling flavors declined 2 percent, with
growth of 6½ percent for our energy portfolio. Still beverages grew
1½ percent, with juices down ½ percent and water up 5½ percent, led
by Chaudfontaine and the introduction of smartwater in Great
Britain. Total volume in Great Britain declined ½ percent and
volume in continental Europe (including Norway and Sweden)
increased ½ percent for the full year.
Full-year net sales totaled $8.3 billion, up ½ percent on a
reported basis, or down ½ percent on a currency-neutral basis. Net
pricing per case for the full year declined ½ percent, and cost of
sales per case declined 1 percent. Operating expenses increased
approximately 1 percent. These figures are presented on a
comparable and currency-neutral basis. Free cash flow for 2014
totaled $677 million.
For the fourth quarter, volume grew 2 percent, driven primarily
by growth in Coca-Cola trademark brands, including 9 percent growth
for Coca-Cola Zero and introductory volume for Coca-Cola Life.
Sparkling flavors grew 1 percent, with growth of 11 percent for our
energy portfolio. Still beverages grew 7½ percent, with juices up 4
percent and water up 12½ percent in the quarter. Fourth-quarter
volume in Great Britain grew 6 percent, and continental European
volume declined 1 percent.
Fourth-quarter net sales totaled $1.9 billion, down 5½ percent
on a reported basis, or up 1½ percent on a currency-neutral basis.
Reported operating income totaled $195 million, a decline of 10
percent. On a comparable basis, operating income totaled $227
million, a decline of 2 percent, or an increase of 5 percent on a
comparable and currency-neutral basis. Fourth-quarter net pricing
per case declined 2 percent, and cost of sales per case declined 2½
percent, both on a comparable and currency-neutral basis.
“Despite the continued challenges in our markets, we believe our
commitment to customer service and innovation, as well as continued
focus on improving efficiency and effectiveness, will allow us to
realize available growth opportunities,” said Hubert Patricot,
executive vice president and president, European Group.
“Our business plan for 2015 includes solid brand, package, and
marketplace initiatives, including expanding the distribution of
new products such as Coca-Cola Life and Finley. We also will
continue to increase our penetration in the convenience channel,
grow our digital sales presence, and optimize the high levels of
service we provide our customers,” Mr. Patricot said.
SHARE REPURCHASE
CCE repurchased approximately $925 million of its shares in
2014, reflecting our commitment to generate cash from operations,
optimize our capital structure, and to return excess cash to
shareowners. In 2015, the company expects to repurchase
approximately $600 million of its shares. These plans may be
adjusted depending on economic, operating, or other factors,
including acquisition opportunities.
FULL-YEAR 2015 OUTLOOK
CCE expects 2015 earnings per diluted share to grow in a range
of 6 percent to 8 percent on a comparable and currency-neutral
basis. Although it is too early to predict the impact, based on
recent exchange rates, currency translation would negatively impact
full-year earnings per diluted share by approximately 16
percent.
Net sales and operating income are expected to be slightly
positive on a comparable and currency-neutral basis. The company
also expects 2015 free cash flow in a range of $600 million to $650
million, including the expected negative impact of currency
translation based on recent rates. Capital expenditures are
expected to be approximately $325 million. Weighted-average cost of
debt is expected to be approximately 3 percent. The comparable
effective tax rate for 2015 is expected to be in a range of 27
percent to 28 percent.
CONFERENCE CALL
CCE will host a conference call with investors and analysts
today at 10 a.m. ET. The call can be accessed through the company’s
website at www.cokecce.com.
ABOUT CCE
Coca-Cola Enterprises, Inc. (CCE) is the leading Western
European marketer, producer, and distributor of non-alcoholic
ready-to-drink beverages and one of the world’s largest independent
Coca-Cola bottlers. CCE is the sole licensed bottler for products
of The Coca-Cola Company in Belgium, continental France, Great
Britain, Luxembourg, Monaco, the Netherlands, Norway, and Sweden.
We operate with a local focus and have 17 manufacturing sites
across Europe, where we manufacture nearly 90 percent of our
products in the markets in which they are consumed. Corporate
responsibility and sustainability is core to our business, and we
have been recognized by leading organizations in North America and
Europe for our progress in water use reduction, carbon footprint
reduction, and recycling initiatives. For more information about
our company, please visit our website at www.cokecce.com and follow
us on Twitter at @cokecce.
FORWARD-LOOKING STATEMENTS
Included in this news release are forward-looking management
comments and other statements that reflect management’s current
outlook for future periods. As always, these expectations are based
on currently available competitive, financial, and economic data
along with our current operating plans and are subject to risks and
uncertainties that could cause actual results to differ materially
from the results contemplated by the forward-looking statements.
The forward-looking statements in this news release should be read
in conjunction with the risks and uncertainties discussed in our
filings with the Securities and Exchange Commission (“SEC”),
including our most recent Form 10-K and other SEC filings.
COCA-COLA ENTERPRISES, INC. CONSOLIDATED STATEMENTS OF
INCOME (In millions, except per share data)
Fourth Quarter (a) Full Year 2014
2013 2014
2013 Net sales $ 1,925 $
2,032 $ 8,264 $ 8,212 Cost of sales 1,256 1,344 5,291
5,350 Gross profit 669 688 2,973 2,862 Selling,
delivery, and administrative expenses 474 471 1,954
1,948 Operating income 195 217 1,019 914 Interest
expense, net 30 28 119 103 Other nonoperating expense (7 ) (3 ) (7
) (6 ) Income before income taxes 158 186 893 805 Income tax
expense 46 51 230 138 Net income $ 112
$ 135 $ 663 $ 667 Basic earnings per
share $ 0.46 $ 0.52 $ 2.68 $ 2.49
Diluted earnings per share $ 0.46 $ 0.51 $ 2.63
$ 2.44 Dividends declared per share $ 0.25 $
0.20 $ 1.00 $ 0.80 Basic weighted average
shares outstanding 242 258 247 268
Diluted weighted average shares outstanding 246 264
252 273
___________________________
(a) Amounts presented for the fourth quarters of 2014 and 2013
have not been audited.
COCA-COLA ENTERPRISES, INC. CONSOLIDATED STATEMENTS OF
COMPREHENSIVE INCOME (In millions) Year
Ended December 31, 2014 2013
Net income $ 663 $ 667
Components of other comprehensive (loss)
income: Currency translations Pretax activity, net (482 ) 82
Tax effect — — Currency translations, net of tax (482
) 82 Net investment hedges Pretax activity, net 256 (61 ) Tax
effect (90 ) 21 Net investment hedges, net of tax 166 (40 )
Cash flow hedges Pretax activity, net (15 ) 21 Tax effect 4
(6 ) Cash flow hedges, net of tax (11 ) 15 Pension plan adjustments
Pretax activity, net (79 ) 57 Tax effect 23 (15 ) Pension
plan adjustments, net of tax (56 ) 42 Other comprehensive
(loss) income, net of tax (383 ) 99 Comprehensive income $
280 $ 766
COCA-COLA ENTERPRISES, INC.
CONSOLIDATED BALANCE SHEETS (In millions)
December 31, 2014
2013 ASSETS Current: Cash and cash
equivalents $ 223 $ 343 Trade accounts receivable 1,514 1,515
Amounts receivable from The Coca-Cola Company 67 89 Inventories 388
452 Other current assets 268 169 Total current assets
2,460 2,568 Property, plant, and equipment, net 2,101 2,353
Franchise license intangible assets, net 3,641 4,004 Goodwill 101
124 Other noncurrent assets 240 476 Total assets $
8,543 $ 9,525
LIABILITIES Current:
Accounts payable and accrued expenses $ 1,872 $ 1,939 Amounts
payable to The Coca-Cola Company 104 145 Current portion of debt
632 111 Total current liabilities 2,608 2,195 Debt,
less current portion 3,320 3,726 Other noncurrent liabilities 207
221 Noncurrent deferred income tax liabilities 977 1,103
Total liabilities 7,112 7,245
SHAREOWNERS’ EQUITY
Common stock 3 3 Additional paid-in capital 3,958 3,899 Reinvested
earnings 1,991 1,577 Accumulated other comprehensive loss (714 )
(331 ) Common stock in treasury, at cost (3,807 ) (2,868 ) Total
shareowners’ equity 1,431 2,280 Total liabilities and
shareowners’ equity $ 8,543 $ 9,525
COCA-COLA ENTERPRISES, INC. CONSOLIDATED STATEMENTS OF
CASH FLOWS (In millions) Year Ended December
31, 2014 2013 Cash Flows
from Operating Activities: Net income $ 663 $ 667 Adjustments
to reconcile net income to net cash derived from operating
activities: Depreciation and amortization 309 308 Share-based
compensation expense 28 33 Deferred income tax expense (benefit) 65
(77 ) Pension expense less than contributions (3 ) (19 ) Changes in
assets and liabilities: Trade accounts receivables (151 ) (45 )
Inventories 15 (57 ) Prepaid expenses and other current assets (110
) (21 ) Accounts payable and accrued expenses 94 100 Other changes,
net 72 (56 ) Net cash derived from operating activities 982
833
Cash Flows from Investing Activities:
Capital asset investments (332 ) (313 ) Capital asset disposals 27
4 Settlement of net investment hedges 21 (21 ) Net cash used
in investing activities (284 ) (330 )
Cash Flows from Financing
Activities: Net change in commercial paper 146 — Issuances of
debt 347 931 Payments on debt (114 ) (623 ) Share repurchases under
share repurchase programs (912 ) (1,006 ) Dividend payments on
common stock (246 ) (213 ) Other financing activities, net (10 ) 15
Net cash used in financing activities (789 ) (896 ) Net
effect of currency exchange rate changes on cash and cash
equivalents (29 ) 15
Net Change in Cash and Cash
Equivalents (120 ) (378 )
Cash and Cash Equivalents at
Beginning of Year 343 721
Cash and Cash
Equivalents at End of Year $ 223 $ 343
COCA-COLA ENTERPRISES, INC. RECONCILIATION OF GAAP TO
NON-GAAP (a) (Unaudited; in millions, except per share data
which is calculated prior to rounding) Fourth-Quarter
2014
Cost ofSales
Selling,Delivery,
andAdministrativeExpenses
OperatingIncome
OtherNonoperating(Expense)Income
Income TaxExpense
Net Income
DilutedEarnings PerShare
Reported (GAAP) $ 1,256 474
195 (7 ) 46
$ 112 $ 0.46 Items Impacting
Comparability: Mark-to-Market Effects (b) (1 ) (11 ) 12 — 3 9 0.04
Restructuring Charges (c) — (18 ) 18 — 5 13 0.05 Other Items (d) (2
) — 2 8 2
8 0.03
Comparable (non-GAAP) $
1,253 445 227
1 56
$ 142 $ 0.58 Diluted
Weighted Average Shares Outstanding 246
Fourth-Quarter 2013
Cost ofSales
Selling,Delivery,
andAdministrativeExpenses
OperatingIncome
OtherNonoperating(Expense)Income
Income TaxExpense
Net Income
DilutedEarnings PerShare
Reported (GAAP) $ 1,344 471 217
(3 ) 51 $ 135 $
0.51 Items Impacting Comparability: Mark-to-Market Effects
(b) 1 — (1 ) — — (1 ) — Restructuring Charges (c) (1 ) (10 ) 11 — 6
5 0.02 Tax Indemnification Changes (e) — (5 )
5 — 2 3
0.01
Comparable (non-GAAP) $ 1,344
456 232 (3
) 59 $ 142
$ 0.54 Diluted Weighted Average Shares
Outstanding 264
___________________________
(a) These non-GAAP measures are provided to allow investors to
more clearly evaluate our operating performance and business
trends. Management uses this information to review results
excluding items that are not necessarily indicative of ongoing
results. The adjusting items are based on established defined terms
and thresholds and represent all material items management
considered for year-over-year comparability.
(b) Amounts represent the net out of period mark-to-market
impact of non-designated commodity hedges.
(c) Amounts represent nonrecurring restructuring charges.
(d) Amounts represent charges related to the impairment of our
investment in our recycling joint venture in Great Britain.
(e) Amounts represent post-Merger changes to certain underlying
tax matters covered by our indemnification to TCCC for periods
prior to the Merger.
COCA-COLA ENTERPRISES, INC. RECONCILIATION OF GAAP TO
NON-GAAP (a) (Unaudited; in millions, except per share data
which is calculated prior to rounding)
Full-Year 2014
Cost ofSales
Selling,Delivery,
andAdministrativeExpenses
OperatingIncome
OtherNonoperating(Expense)Income
Income TaxExpense
Net Income
DilutedEarnings PerShare
Reported (GAAP) (b) $ 5,291
1,954 1,019 (7 )
230 $ 663 $ 2.63
Items Impacting Comparability: Mark-to-Market Effects (c) 13 (11 )
(2 ) — (1 ) (1 ) — Restructuring Charges (d) — (81 ) 81 — 26 55
0.22 Other Items (e) (2 ) — 2 8 2 8
0.03
Net Tax Items (g) — — — —
6 (6 )
(0.03
)
Comparable (non-GAAP) $ 5,302
1,862 1,100 1
263 $ 719
$ 2.85 Diluted Weighted Average
Shares Outstanding 252 Full-Year
2013
Cost ofSales
Selling,Delivery,
andAdministrativeExpenses
OperatingIncome
OtherNonoperating(Expense)Income
Income TaxExpense
Net Income
DilutedEarnings PerShare
Reported (GAAP) (b) $ 5,350 1,948
914 (6 ) 138 $ 667
$ 2.44 Items Impacting Comparability: Mark-to-Market
Effects (c) (7 ) — 7 — 2 5 0.02 Restructuring Charges (d) (5 ) (115
) 120 — 37 83
0.30
Tax Indemnification Changes (f) — (5 ) 5 — 2 3 0.01 Net Tax Items
(g) — — — —
71 (71 ) (0.26 )
Comparable (non-GAAP)
$ 5,338 1,828
1,046 (6 ) 250
$ 687 $
2.51 Diluted Weighted Average Shares
Outstanding 273
___________________________
(a) These non-GAAP measures are provided to allow investors to
more clearly evaluate our operating performance and business
trends. Management uses this information to review results
excluding items that are not necessarily indicative of ongoing
results. The adjusting items are based on established defined terms
and thresholds and represent all material items management
considered for year-over-year comparability.
(b) As reflected in CCE's U.S. GAAP Consolidated Financial
Statements.
(c) Amounts represent the net out of period mark-to-market
impact of non-designated commodity hedges.
(d) Amounts represent nonrecurring restructuring charges.
(e) Amounts represent charges related to the impairment of our
investment in our recycling joint venture in Great Britain.
(f) Amounts represent post-Merger changes to certain underlying
tax matters covered by our indemnification to TCCC for periods
prior to the Merger.
(g) Amounts represent the tax impact of both cumulative
nonrecurring items and changes in income tax rates on the year.
COCA-COLA ENTERPRISES, INC. RECONCILIATION OF GAAP TO
NON-GAAP SEGMENT INCOME (a) (Unaudited; in millions)
Full-Year 2014 Europe
Corporate Operating Income Reported (GAAP)
(b) $ 1,151 $ (132 )
$ 1,019 Items Impacting Comparability: Mark-to-Market
Effects (c) — (2 ) (2 ) Restructuring Charges (d) 81 — 81 Other
Items (e) 2 — 2
Comparable (non-GAAP) $ 1,234
$ (134 ) $
1,100 Full-Year 2013 Europe
Corporate Operating Income Reported (GAAP) (b)
$ 1,063 $ (149 ) $
914 Items Impacting Comparability: Mark-to-Market Effects
(c) — 7 7 Restructuring Charges (d) 120 — 120 Tax Indemnification
Changes (f) — 5 5
Comparable (non-GAAP) $
1,183 $ (137 )
$ 1,046 Fourth-Quarter 2014
Europe Corporate Operating Income Reported
(GAAP) $ 240 $ (45 )
$ 195 Items Impacting Comparability: Mark-to-Market
Effects (c) — 12 12 Restructuring Charges (d) 18 — 18 Other Items
(e) 2 — 2
Comparable (non-GAAP) $ 260
$ (33 ) $ 227
Fourth-Quarter 2013 Europe
Corporate Operating Income Reported (GAAP)
$ 259 $ (42 ) $
217 Items Impacting Comparability: Mark-to-Market Effects
(c) — (1 ) (1 ) Restructuring Charges (d) 11 — 11 Tax
Indemnification Changes (f) — 5 5
Comparable (non-GAAP)
$ 270 $ (38 )
$ 232
___________________________
(a) Amounts represent post-Merger changes to certain underlying
tax matters covered by our indemnification to The Coca-Cola Company
for periods prior to the Merger.
(b) As reflected in CCE's U.S. GAAP Consolidated Financial
Statements.
(c) Amounts represent the net out of period mark-to-market
impact of non-designated commodity hedges.
(d) Amounts represent nonrecurring restructuring charges.
(e) Amounts represent charges related to the impairment of our
investment in our recycling joint venture in Great Britain.
(f) Amounts represent post-Merger changes to certain underlying
tax matters covered by our indemnification to The Coca-Cola Company
for periods prior to the Merger.
COCA-COLA ENTERPRISES, INC. RECONCILIATION OF NON-GAAP
MEASURES (Unaudited; in millions, except percentages)
Fourth-Quarter 2014Change
VersusFourth-Quarter 2013
Full-Year 2014Change
VersusFull-Year 2013
Net Sales Per
Case
Change in Net Sales per Case (8.5)% 0.5% Impact of Excluding Post
Mix, Non-Trade, and Other (0.5) —
Bottle and Can Net
Pricing Per Case (9.0) 0.5 Impact of Currency Exchange Rate
Changes 7.0 (1.0)
Currency-Neutral Bottle and Can
Net Pricing Per Case (a) (2.0)% (0.5)%
Cost of Sales Per
Case
Change in Cost of Sales per Case (9.5)% (1.0)% Impact of Excluding
Post Mix, Non-Trade, and Other
—
1.0
Bottle and Can Cost of Sales Per Case (9.5) —
Impact of Currency Exchange Rate Changes 7.0 (1.0)
Currency-Neutral Bottle and Can Cost of Sales Per Case
(a) (2.5)% (1.0)%
Physical Case
Bottle and Can Volume
Change in Volume 3.5% —% Impact of Selling Day Shift (1.5)
N/A
Comparable Bottle and Can Volume (b) 2.0%
—% Full Year
Reconciliation of
Free Cash Flow (c)
2014 2013 Net Cash
Derived From Operating Activities $ 982 $ 833 Less: Capital Asset
Investments (332 ) (313 ) Add: Capital Asset Disposals 27
4
Free Cash Flow $ 677
$ 524
Reconciliation of
Net Debt (d)
December 31, 2014 December 31, 2013
Current Portion of Debt $ 632 $ 111 Debt, Less Current Portion
3,320 3,726 Less: Cash and Cash Equivalents (223 )
(343 )
Net Debt $ 3,729
$ 3,494
___________________________
(a) The non-GAAP financial measures "Currency-Neutral Bottle and
Can Net Pricing Per Case" and "Currency-Neutral Bottle and Can Cost
of Sales per Case" are used to more clearly evaluate bottle and can
pricing and cost trends in the marketplace. These measures exclude
items not directly related to bottle and can pricing or cost and
currency exchange rate changes.
(b) The non-GAAP measure "Comparable Bottle and Can Volume" is
used to analyze the performance of our business on a constant
period basis. There was one additional selling day in the
fourth-quarter of 2014 versus the fourth-quarter of 2013. There
were the same number of selling days in the full year 2014 versus
the full year 2013.
(c) The non-GAAP measure "Free Cash Flow" is provided to focus
management and investors on the cash available for debt reduction,
dividend distributions, share repurchase, and acquisition
opportunities.
(d) The non-GAAP measure "Net Debt" is used to more clearly
evaluate our capital structure and leverage.
Coca-Cola Enterprises, Inc.Thor Erickson, +1 (678)
260-3110Investor RelationsorFred Roselli, +1
(678) 260-3421Media Relations
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