Coca-Cola Enterprises Inc. Provides 2005 Guidance and 2004 Update.ATLANTA Atlanta (ətlăn`tə, ăt–), city (1990 pop. 394,017), state capital and seat of Fulton co., NW Ga., on the Chattahoochee R. and Peachtree Creek, near the Appalachian foothills; inc. 1847. -- Coca-Cola Enterprises Coca-Cola Enterprises NYSE: CCE is the largest bottler by volume in the Coca-Cola System. It is the anchor bottler for North America and parts of Europe. The company is the bottler of Coca-Cola and its other soft drink products, and in some areas a few other soft drink Inc. (NYSE NYSE See: New York Stock Exchange : CCE CCE Cornell Cooperative Extension CCE Corporate and Continuing Education CCE Coca-Cola Enterprises Inc. CCE Commission de Coopération Environnementale CCE Centre for Continuing Education CCE College of Continuing Education CCE Certified Computer Examiner ) --CCE targets balanced volume and pricing growth in 2005 with operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. up 4 percent to 5 percent. --2005 earnings per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. common share are expected in low to mid- mid- pref. Middle: midbrain. $1.30s range. --Cash flow from operations less capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. is expected to total approximately $700 million in 2005. Coca-Cola Enterprises ("CCE") today will host a conference call with analysts and investors to provide its outlook for 2005. Chairman of the Board Lowry Low·ry , (Clarence) Malcolm 1909-1957. British writer. His novel Under the Volcano (1947) is recognized as a masterpiece of modern fiction. Noun 1. Lowry - English painter (1887-1976) L. S. F. Kline, President and Chief Executive Officer John R. Alm See application lifecycle management and AppWare. ALM - Assembly Language for Multics , and other members of CCE's senior management team will conduct the call today at 10 a.m. ET. The call will be webcast via our Web site, www.cokecce.com, and a replay will be available through the site's Investor Relations Investor relations The process by which the corporation communicates with its investors. section. "2004 has been a difficult year as we have worked to overcome the substantial impact of health and wellness trends on regular soft drinks, a slowing retail environment and cool, rainy rain·y adj. rain·i·er, rain·i·est Characterized by, full of, or bringing rain. rain  i·ness n.Adj. weather in many of our territories," said Lowry F. Kline. "While we did not generate expected levels of performance this year, we took steps to preserve our strong free cash flow, strengthen our revenue management capabilities and solidify so·lid·i·fy v. so·lid·i·fied, so·lid·i·fy·ing, so·lid·i·fies v.tr. 1. To make solid, compact, or hard. 2. To make strong or united. v.intr. an improved planning process with The Coca-Cola Company to bolster This article is about the pillow called a bolster. For other meanings of the word "bolster", see bolster (disambiguation). A bolster (etymology: Middle English, derived from Old English, and before that the Germanic word bulgstraz the opportunity for future success." Management expects reported 2004 earnings per diluted share in a range of $1.21 to $1.23, with comparable EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. in a range of $1.26 to $1.28. 2004 comparable earnings per diluted share exclude the 5 cent impact of transitioning to new concentrate pricing in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. . We expect full-year 2004 case sales to decline approximately 1 percent in North America and 4 percent to 5 percent in Europe. All case sales comparisons are presented on a comparable basis for shipping days and acquisitions. 2005 Outlook "In 2005, we expect to achieve an improved balance of volume and pricing growth in both North America and Europe as we benefit from our system's renewed efforts on innovation and marketing," said John R. Alm, president and chief executive officer. "We will achieve this improvement through brand, package, channel, and operational initiatives that support our four primary strategic objectives." In today's conference call, Mr. Alm and other members of senior management will provide commentary on our four strategic objectives. --Strengthen our brand portfolio - Our system will provide a full calendar of product and package innovation in 2005. In the first quarter, we will introduce a new energy drink, Full Throttle Full Throttle can refer to:
--Optimize revenue growth - Through our strengthened revenue management capabilities, we targeted our 2005 pricing by region to reflect local consumer, competitive, customer, and economic conditions. Our strong presence in the immediate consumption channels provides us the opportunity to manage the pricing of our brand and package portfolio to minimize volume pressure in the future consumption channels. --Excel at customer management - In 2005, we will continue to expand our business in emerging channels and with nontraditional customers. We will also further enhance our category management capabilities as we work to reinforce the strategic role that soft drinks play in the overall profitability of our customers. --Increase effectiveness and efficiency - We have projects underway to drive improved efficiency across our business. Because the majority of our operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. relate to labor, we are testing a number of initiatives in 2005 to improve labor productivity and efficiency as we work to minimize our operating expense Operating Expense The essential things that a company must purchase in order to maintain business. Notes: For example, the payment of employees wages are an operating expense. Also known as OPEX. growth. "We recognize there are challenges ahead in 2005 as we continue to deal with health and wellness trends, a soft retail environment and higher commodity costs," Mr. Alm said. "Yet we are confident our improved innovation pipeline, effective pricing plans, strong customer relationships and a dedication to continuous improvement in our operations will enable us to achieve our 2005 goals." 2005 earnings per diluted common share is expected in the low to mid-$1.30s range. Management expects another year of strong free cash flow with cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses less capital spending of approximately $700 million. The majority of our available cash will be used for debt repayment in 2005. We also expect our improved financial performance and capital management initiatives to yield improvement in our return on invested capital of 30 to 40 basis points. While we expect solid improvement in our full-year 2005 financial results, quarterly comparisons to prior year will be impacted by shipping days comparisons, sales volatility experienced during 2004, and the timing of our 2005 product innovation calendar. Accordingly, we expect to achieve the following quarterly operating income growth in 2005: --First quarter - Mid-teens decline --Second and third quarters - Mid to high-single digit A single character in a numbering system. In decimal, digits are 0 through 9. In binary, digits are 0 and 1. digit - An employee of Digital Equipment Corporation. See also VAX, VMS, PDP-10, TOPS-10, DEChead, double DECkers, field circus. growth --Fourth quarter - Mid-teens growth We will provide more specific guidance on our quarterly operating income and earnings per share expectations when we report full-year 2004 earnings in mid-February. Coca-Cola Enterprises Inc. (NYSE: CCE) is the world's largest marketer, distributor, and producer of bottle and can liquid nonalcoholic non·al·co·hol·ic adj. A beverage usually containing less than 0.5 percent alcohol by volume. refreshment. Coca-Cola Enterprises sells approximately 80 percent of The Coca-Cola Company's bottle and can volume in North America and is the sole licensed bottler for products of The Coca-Cola Company in Belgium, continental France, Great Britain Great Britain, officially United Kingdom of Great Britain and Northern Ireland, constitutional monarchy (2005 est. pop. 60,441,000), 94,226 sq mi (244,044 sq km), on the British Isles, off W Europe. The country is often referred to simply as Britain. , Luxembourg, Monaco, and the Netherlands. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. 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 the currently available competitive, financial, and economic data along with our operating plans and are subject to future events and uncertainties. The forward-looking statements in this news release should be read in conjunction with the detailed cautionary statements found on pages 82 and 83 of our 2003 Annual Report and on pages 38 and 39 of the Company's Third-Quarter 2004 Form 10-Q Form 10-Q See 10-Q. .
Coca-Cola Enterprises Inc.
Reconciliation of Non-GAAP Measures
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Projected 2004 Earnings per Diluted Common Share $1.21 to $1.23
Impact of Concentrate Price Transition 0.05
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Projected 2004 Earnings per Diluted Common Share,
Excluding Nonrecurring Items (a) $1.26 to $1.28
==============
(a) Comparable financial information is provided to allow investors to
more clearly evaluate our operating performance and business
trends.
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($ in thousands)
Projected 2005 Cash Flow from Operations (approximate) $1,750
Projected 2005 Capital Spending 1,050
(midpoint of $1 billion to $1.1 billion guidance) ------
Projected 2005 Cash Flow from Operations, Excluding
Capital Spending (b) $ 700
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(b) Cash flow from operations, excluding capital spending is provided
to allow investors to more clearly evaluate our liquidity and cash
flow available for debt service, acquisitions, dividends, and
share repurchases.
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Physical Case Bottle and Can Volume
North
Total America Europe
----- ------- ------
Projected 2004 Case Sales Change (2)% (1)% (3.5)% to (4.5)%
Impact of Acquisitions (0)% (0)% (0.5)%
Impact of One Additional Selling Day (0)% (0)% (0)%
Projected 2004 Comparable Case Sales
Change (2)% (1)% (4)% to (5)%
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Coca-Cola Enterprises Inc.
2005 Guidance
(All Financial Guidance is Currency Neutral)
Projection
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Volume Growth 1% to 2%
North America Approx. 1%
Europe Approx. 4%
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Pricing Per Case Growth Approx. 4%
(including mix benefit)
North America Approx. 4%
Europe Approx. 3%
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Cost of Goods Per Case Growth 4% to 5%
(including mix impact)
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Operating Expense $ Growth 4% to 5%
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Operating Income Growth 4% to 5%
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Capital Expenditures $1.0 to $1.1 billion
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Interest Expense $625 to $635 million
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Effective Tax Rate 31%
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2005 Diluted EPS Low to Mid-$1.30s
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Diluted Common Shares Approx. 474 million
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Note: All cost of goods and operating income growth guidance exclude the 2004 impact of the concentrate price transition. Volume growth guidance is based on comparable selling days. 2005 will include two less selling days in the first quarter and full year. |
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