2021 Full Year Results

STRONG EXECUTION DRIVES GROWTH MOMENTUM

Coca-Cola HBC AG, a growth-focused Consumer Packaged Goods business and strategic bottling partner of The Coca-Cola Company, reports its financial results for the full year ended December 2021.

Full-year highlights

• Effective execution in a volatile environment drove strong recovery
  • FX-neutral revenue growth +20.6% like-for-like¹. Reported revenues +16.9%
  • Business gained momentum in Q4, with FX-neutral revenue closing 10% above 2019² levels for the year like-for-like
  • Value share gains continued to increase, +80bps in NARTD
    
    
• Volume growth of 14.0% like-for-like, or 13% on a reported basis, led by the Emerging and Established segments as well as the strategic priorities in our portfolio
  • Sparkling volume +13.8%, Low/no sugar +47.3%; Adult sparkling +31.8%
  • Energy volume + 45.3%, driven by the performance of Monster, Burn and Predator
    
    
• Strength of brand portfolio demonstrated as pricing and other revenue growth management actions drove FX-neutral revenue per case +5.8%, or +3.9% excluding Poland
  
  
• Consistent investment behind strategic priorities building growth momentum
  • Costa Coffee now available in 17 markets; Caffè Vergnano launched in Q4, now live in 5 markets
  • Geographical expansion into Egypt adds exciting growth opportunity, integration on track
  • Net Zero commitment backed by €250 million investment by 2025
    
    
• Expanded EBIT margin while increasing marketing investment
  • Comparable EBIT grew by 23.6% with margins +60bps to 11.6%, including c. 30bps benefit from Cyprus property sale. Reported EBIT grew by 21.0%
  • Opex as a percent of revenue improved by 2.2pp, driven by operating leverage, cost savings higher than plan; 30 bps benefit from Cyprus property sale
  • Marketing expenditure +63%, full year spend almost back to pre-pandemic levels
    
    
• Strong earnings growth, record high free cash flow and increased dividend pay-out target range
  • Comparable EPS up 33.7% to €1.58 on lower tax rate; free cash flow increased by €104.3 million to €601.3 million
  • Increased dividend pay-out ratio target to 40-50%, previously 35-45%
  • Board of Directors to propose ordinary dividend of €0.71 per share, up +10.9% year-on-year

Segment highlights

Emerging segment strong momentum and ongoing Established and Developing segments recovery

• Established: FX-neutral revenue increased by 13.9% with volumes up 9.9% as in-market execution capitalised on reopening. Comparable EBIT expanded 43.9%, or 33% excluding the Cyprus property sale.
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• Developing: FX-neutral revenue up 18.0%, with volumes up 0.8% and comparable EBIT up 4.3%, despite impact from Polish sugar tax.
  
  
• Emerging: FX-neutral revenue up 27.1% like-for-like driven by strong momentum in Nigeria, Russia, and Ukraine and recovery through the rest of the segment. Comparable EBIT grew by 17.3%.

Zoran Bogdanovic, Chief Executive Officer of Coca-Cola HBC AG, commented:

“The business has delivered a very strong recovery in 2021, with all key metrics above pre-pandemic levels, the result of consistent and disciplined focus on our strategic priorities over the last few years. We finished the year with strong revenue growth, our highest ever EBIT margin and free cash flow while continuing to gain share. This performance demonstrates the strength of our 24/7 brand portfolio, revenue growth management capabilities and execution excellence in our markets. It is driven by the strong drive and passion of our people, who continue to show great creativity and adaptability in navigating the volatile operating environment while nurturing our culture which embraces change, challenge and care. Our results and strong future plans are also a reflection of our stronger than ever partnership with The Coca-Cola Company.

2021 also marked 70 years since our early beginnings in Nigeria and I am more excited than ever by the growth potential of our business, further strengthened with the addition of Egypt to our country portfolio.

Revenue growth management actions focused behind both premium and affordable offers, as well as pricing and ongoing productivity improvements have enabled us to continue investing behind our strategic priorities, including in capabilities development, whilst achieving EBIT margin expansion.

We are encouraged by the momentum we see in the business. We expect 2022 to be a year of strong sales supported by ongoing volume momentum, pricing actions and beneficial category mix. While mindful of inflationary headwinds and other risks, our track record and continuous focus on efficiencies give me confidence in delivering another year of EBIT growth. Given the positive long-term outlook for the business we are increasing our targeted dividend pay-out range to 40-50%.”

¹Performance, unless stated otherwise, is negatively impacted by the change in classification of our Russian Juice business, Multon, from a joint operation to a joint venture, following its re-organisation in May 2020. Performance is also positively impacted by the acquisition of Bambi in June 2019, when compared to 2019. Unless stated otherwise, performance compared to 2019 is presented on a like-for-like basis. For the Group’s growth including the respective performance of Multon as a joint operation in the current year, refer to the relevant table in the ‘Supporting information‘ section.

²Comparison to 2019 is made to present growth versus pre-pandemic levels of performance.

³For details on APMs refer to ‘Alternative Performance Measures’ and ‘Definitions and reconciliations of APMs’ sections.

⁴Refer to the condensed consolidated income statement.

⁵Net Profit and comparable net profit refer to net profit and comparable net profit respectively after tax attributable to owners of the parent.