Coca-Cola Amatil posts 16 per cent slump in first half profit to $182.3 million, blames weak post-budget consumer sentiment

COCA-COLA Amatil has warned that post-budget weak consumer sentiment is set to mean tough trading conditions for the rest of the year.

The bottling company described it as a “difficult year” for employees and shareholders.

COCA-COLA Amatil has warned that post-budget weak consumer sentiment is set to mean tough trading conditions for the rest of the year after a 16 per cent slump in first half profit.

The beverage company’s net profit of $182.3 million was down from $216 million in 2013.

It announced 20 cents a share dividend, 75 per cent franked, down from 24 cents.

Full year earnings for 2014 were expected to be materially lower than 2013, CCA said.

Group capital expenditure was expected to reduce to around $320 million in 2014 with about 50 per cent of that to be invested in Indonesia and PNG to increase production capacity and cold drink cooler penetration.

The company’s managing director Alison Watkins said CCA had been slow to adapt to changes in market conditions and consumer trends. The beverage landscape in Australia and New Zealand had evolved over the past five years with increased competition making growth more difficult to achieve.

She announced an update of CCA’s strategic review, including a greater investment in marketing and a savings target of $100 million over the next five years.

“This is a difficult year for our employees and shareholders,” Ms Watkins said.

“We are making some hard decisions and implementing a range of positive changes that will provide a foundation for sustainable growth in the years to come.”