Coca-Cola Europacific Partners (CCEP) has announced an investment in Pipeline Organics, a climate tech startup hoping to revolutionise the generation of clean and renewable energy.
Pipeline Organics’ technology uses advanced chemistry and manufacturing processes to convert sugar-rich wastewater into a continuous supply of renewable electricity.
This breakthrough technology has the potential to power essential processes across CCEP’s sites, from lighting to powering production lines.
CCEP aims to scale this innovative technology by providing Pipeline Organics with access to its sites where the technology can be trialled, using the sugar-rich wastewater that is created as a by-product of drinks manufacturing.
CCEP has been steadily progressing towards its renewable electricity goals, with renewable electricity already used in 78% of its operations in 2023. By investing in breakthrough solutions like Pipeline Organics, CCEP aims to accelerate the adoption of clean energy technologies and drive positive change in the industry.
The Board of Directors of The Coca-Cola Company announced the election of Manuel “Manolo” Arroyo as an executive vice president of the company, effective since Jan. 1, 2024. There are no changes to Arroyo’s duties as global chief marketing officer, a role he has held since January 2020.
Arroyo is responsible for global category teams; Integrated Marketing Experience, including media, digital marketing, design, marketing assets, human insights and marketing performance; marketing operations and capabilities; and the marketing transformation office.
Coca-Cola Europacific Partners plc (CCEP) announces it has, together with Aboitiz Equity Ventures Inc. (AEV), entered into a definitive agreement to jointly acquire Coca-Cola Beverages Philippines, Inc. (CCBPI) from The Coca-Cola Company (KO).
The acquisition will build on CCEP’s successful expansion into Australia, Pacific & Indonesia (API) in 2021, further strengthening the partnership with its significant shareholder KO, and positioning CCEP as the world’s largest Coca-Cola bottler by both revenue and volume while supporting its long-term growth strategy and focus on driving shareholder value.
CCEP’s acquisition of CCBPI, with AEV, one of the leading conglomerates in the local market, offers a great opportunity to co-own an established, well-run business with attractive profitability and growth prospects.
The transaction is a further step for CCEP to create a more diverse footprint within its existing API business segment. It will also provide the opportunity to leverage best practice and talent, including supporting Indonesia’s transformation journey. It is therefore aligned with CCEP’s aim of driving sustainable and stronger growth through diversification and scale, and underpins the company’s mid-term strategic objectives.
Coca-Cola has launched a new limited-edition Coca-Cola 3000 Zero Sugar within the Coca-Cola Creations platform, with the help of artificial intelligence (AI). The AI, in cooperation with humans, helped create both the taste and the design of the can, as Coca-Cola tries to identify what the year 3000 would look like for beverages. It is not just Coca-Cola using AI in the soft drinks category. Unilever, owner of PepsiCo, has developed AI tools to optimise various aspects of its business operations. Against this backdrop, the usage of AI in the soft drinks industry is set to grow for the discovery of new flavours and to enhance the efficiency of business operations, says GlobalData, a leading data and analytics company.
Coca-Cola started with a core question to its customers: What would the year 3000 look like? Consumers were asked how they saw Coca-Cola in the year 3000 via the Coca-Cola Creations platforms. The company then used AI to analyse all the responses to create the framework for the futuristic product based on how people see the future through emotions, ambitions, colours and flavours.
Dragos Dumitrachi, Analyst at GlobalData, comments: “Based on these inputs from consumers and its knowledge of beverage trends, the AI created a unique packaging and flavour profile for a carbonate in the year 3000. The packaging format is colourful, with a mix of spherical shapes blended in purple, pink, and blue colours with a pixelated logo, and the AI primarily perceived the future as being sugar-free. This is to be expected as low-calorie carbonates recorded a 39 % growth between 2015 and 2023 globally, with this growth set to continue over the next five years, as consumers increasingly focus on their health and wellness. According to the latest global survey* by Global Data, 81 % of respondents consider that it is nice to have or essential for a product to be good for physical fitness/health.”
Global Data expects the AI market to grow from USD 81 billion in 2022 to USD 90 billion by 2030, with a 35 % compound annual growth rate (CAGR) during 2022-2030. Recent progress in machine learning (ML) on the back of improved algorithms (e.g., Google’s AlphaGo, OpenAI’s GPT-3/ChatGPT, Tesla’s AutoPilot) and increasing computing power have enabled AI to become more widely used in the soft drinks industry.
The AI-driven applications developed by Unilever leverage neural networks and the GPT API is aimed at enhancing the company’s ability to respond to the evolving needs of its consumer base and broader market dynamics. On top of that, Unilever is using AI to identify alternative ingredients that can reinforce the resilience of their supply chains, making their products more sustainable and cost-efficient, and streamlining the number of ingredients without impacting the effectiveness or quality of the products.
Dragos concludes: “The AI market in the soft drinks industry is still in its infancy; the rules and laws that will govern it are still under debate. Global Data is forecasting that the use of AI for supply chain, administrative issues, and the discovery of new flavours and packaging formats in the soft drinks industry will only grow.”
*GlobalData 2023 Q2 Consumer Survey – Global, with 21,595 respondents, published November 2022
The Coca-Cola Company and Pernod Ricard announced a global relationship to debut Absolut Vodka & Sprite as a ready-to-drink pre-mixed cocktail in 2024.
Absolut & Sprite will be made with Absolut, the international premium vodka, and Sprite, the world’s most popular lemon-lime sparkling soft drink. The pre-mixed cocktail will be available in versions with Sprite and Sprite Zero Sugar, with the initial launch planned for select European countries in early 2024, including the United Kingdom, the Netherlands, Spain and Germany.
“We keep consumers at the center of everything we do as we continue to develop our portfolio as a total beverage company,” said James Quincey, Chairman and CEO of The Coca-Cola Company. “We are expanding in the alcohol ready-to-drink space, including products that use select brands from our core portfolio. We are excited about our new relationship with Pernod Ricard and look forward to the introduction of Absolut & Sprite.”
“This very promising and pioneering project brings together two leading companies who are committed to offering their consumers new experiences around premium products,” said Alexandre Ricard, CEO of Pernod Ricard, a worldwide leader in the spirits and wine industry.
Vodka is one of the most popular bases for alcohol ready-to-drink products, and lemon-lime soft drinks are one of the most popular mixers in pre-mixed cocktails.
“Sprite is a wonderful pairing for Absolut, and I’m convinced that our joining forces will bring the whole alcohol RTD category to the next level,” Ricard said.
Absolut & Sprite ready-to-drink packaging will feature two of the world’s most recognisable global trademarks. Absolut was established in 1879 in Sweden. Since then, it has become a world-renowned premium vodka brand, crafted using the finest Swedish winter wheat. Sprite was established in 1959 in Germany and has grown to be one of the biggest brands in The Coca-Cola Company’s global portfolio.
Cans will include clear responsibility symbols stating that the drink is to be enjoyed only by consumers of legal drinking age. Absolut & Sprite ready-to-drink will adhere to responsible marketing practices.
The global benchmark for alcohol beverage volume (ABV) is 5 % but will vary depending on the market.
Taking a major step to support a circular economy, Coca-Cola® launched in rPET in pack sizes of 250 ml and 750 ml across several markets in India.
After being the first company in India to launch a one-litre bottle made from 100 % recycled PET (rPET) for its packaged drinking water brand Kinley, Coca-Cola India is taking another meaningful step towards creating a circular economy and has announced the launch of Coca-Cola® in rPET in pack sizes of 250 ml and 750 ml. These rPET bottles are being manufactured by Coca-Cola bottling partners – Moon Beverages Ltd., and SLMG Beverages Ltd.
The rPET bottles expansion showcases Coca-Cola India’s transformative journey towards building a sustainable and greener future for all. The bottles made from 100 % food-grade rPET (excluding caps and labels) have an on-pack call to action “Recycle Me Again” message and will also drive consumer awareness with “100 % recycled PET bottle” displayed on the pack.
These rPET bottles are crafted from food-grade recycled polyethylene terephthalate (PET). The plastic is recycled as per the technologies approved by the US FDA and European Food Safety Authority (EFSA) for food-grade recycled material and repurposed into new PET bottles, reducing the need for virgin plastic for producing PET Bottles.
The Coca–Cola Company now offers 100 % rPET bottles in over 40 markets, bringing it closer to its World Without Waste goal of making bottles with 50 % recycled content by 2030. Announced in 2018, the sustainable packaging platform also includes a goal to collect and recycle the equivalent of a bottle or can for every one the company sells globally by 2030, and to make 100 % of its packaging recyclable by 2025.
The Food Safety Authority of India (FSSAI) has approved the use of recycled PET in food packaging. Similarly, the Government of India’s, Ministry of Environment, Forest and Climate Change, and the Bureau of Indian Standards has enabled befitting regulations and standards to facilitate the use of recycled plastics in food and beverage packaging.
Coca-Cola is making it convenient for consumers to return their empty PET bottles by recycling them at conveniently placed drop-off points or Reverse Vending Machines (RVM’s). Earlier this year, Coca-Cola India launched a ‘Return and Recycle’ initiative with Zepto that focuses on gathering PET bottles directly from consumers. This also helps in establishing an organised process of collecting PET bottles with 100 % traceability. Specifically for India, Coca-Cola introduced ASSP (Affordable Small Sparkling Pack) for the 250 ml PET bottle. ASSP, a proprietary Coca-Cola innovative technology is used to reduce plastic usage in the production of PET bottles for sparkling products by up to 40 percent.
Created with gamers for gamers, the new Coca-Cola® Ultimate Zero Sugar represents a bold, kinetic expression of Experience Points (+XP), the universal unit of rewards players earn as they progress through a game. The latest limited-edition Coca-Cola Creations drop was crafted in collaboration with League of Legends developer Riot Games.
Coca‑Cola® Ultimate Zero Sugar’s striking packaging design fuses elements of both iconic brands, taking visual cues from League of Legends lore – including a bespoke “Ultimate” crest with a blue Hextech backlit glow, a Spencerian Script inspired by Nexus crystals in “Runeterra” and a bold, gold-and-back manifestation of the Coca-Cola Creations logo.
“Coca-Cola Creations is all about creating unique and authentic experiences anchored in youth passions, and gaming is one of the largest and fastest-growing communities in the world,” said Oana Vlad, Senior Director, Global Strategy, The Coca-Cola Company. “We dipped our toes into this space last year with Coca-Cola Zero Sugar Byte and the artist Marshmello’s limited-edition Coca-Cola, but this is the first time we have partnered with a gaming company to develop a Coca-Cola flavour.”
Coca-Cola Ultimate Zero Sugar will be sold for a limited time in the United States, Canada, China, South Korea, Latin America and Africa. A full-sugar version is available in the United States, Canada and Mexico.
“We’re excited for players to taste the new +XP flavour, a unique and bespoke collaboration with Coca-Cola, a globally recognised brand loved by millions,” said David Mulhall, Head of Business Development and Partnerships at Riot Games. “They share many of the player-focused values we have at Riot, and we are honoured to be the first gaming collaboration for Coca-Cola Creations.”
The holistic product experience celebrates every player’s gaming journey. Like the six preceding Coca-Cola Creation drops, Coca-Cola Ultimate Zero Sugar will bridge the virtual and real worlds with a series of disruptive digital and IRL activations. League of Legends players can put their skills to the test via a series of in-game missions that unlock a sequence of limited-edition Ultimate Emotes through July 18.
Fans also can scan an on-pack QR code to access the Coca-Cola® Creations Hub, where they can access a League of Legends-inspired Ultimate Emote Generator Instagram filter, pre-order a custom Coca-Cola Ultimate Zero Sugar mini fridge by Cooluli, and upload a selfie to see themselves in their Ultimate form on a cinematic gaming journey.
“The super-personalised experience lets anyone – not just League of Legends enthusiasts – become the hero of their own Ultimate journey,” said Natalia Suarez, Brand Director, Coca‑ColaTM, North America. “It pays off the idea that Coca-Cola is for everyone.”
Coca-Cola and Riot Games will bring the “Ultimate” experience to life with communities of passionate gamers around the world through League of Legends Nexus Crystals drop events in Los Angeles, Shanghai and Mexico City.
Coca-Cola Ultimate Zero Sugar builds on a longstanding collaboration between Coca-Cola and Riot Games celebrating the power of gaming to unite people around the world in competition and fandom. In 2022, the brands announced a multi-year global partnership to co-create unique fan experiences for League of Legends: Wild Rift and Wild Rift Esports. From 2014-2016, Coca-Cola teamed with League of Legends for its World Championship and created custom viewing experiences with highly coveted collectible merchandise in multiple countries through cinema partnerships.
With hundreds of millions of players globally, League of Legends continues to be one of the most-played competitive games in the world. A unique game that blends speed, strategy and high intensity, it has grown to become a global phenomenon over its decade-long history by hyper-serving its loyal communities.
“The idea that fueled Coca-Cola Ultimate was a celebration of the player’s journey,” said Chase Abraham, Director, Global Content & Creative, Coca-ColaTM. “Riot Games aspires to be the world’s most player-forward gaming company, and we see a lot of harmony between our values. A shared passion to get it right with players first and foremost drove the strategy and nature of what we wanted to deliver.”
Coca-Cola® Creations lends the iconic Coca-Cola brand to new expressions fueled by collaboration, creativity and connection. Each sequential, surprise-and-delight drop includes a limited-edition flavour– complemented by designs and experiences – inspired by music, gaming, sports and other consumer passion points. The Coca-Cola Ultimate Zero Sugar launch follows the six fantasy-flavoured Coca-Cola® Creations drops: Coca-Cola® Starlight, Coca-Cola® Zero Sugar Byte, the artist Marshmello’s Limited Edition Coca-Cola®, Coca-Cola® Dreamworld, Coca-Cola® Soul Blast and Coca-Cola® Move.
Volvo Trucks North America announced Coca-Cola Canada Bottling Limited is acquiring six Volvo VNR Electric trucks, as part of a pilot program to service their iconic ‘Red Fleet’ customer delivery routes throughout the Greater Montreal Area. The six trucks are the first Class 8 battery-electric trucks in the beverage distributor’s fleet of 650 heavy-duty vehicles to service customers throughout the region. Coke Canada Bottling is the first Canadian food and beverage manufacturer to use zero-tailpipe emission trucks and all six Volvo VNR Electric trucks will be delivered throughout 2023.
As part of Coke Canada Bottling’s Toward a Better Future Together environmental sustainability action plan, the 6×4 Volvo VNR Electric trucks will contribute to the company’s goal of reducing carbon emissions from direct sources and supplied energy by 46.2 % by 2030. Coke Canada Bottling is taking action on fuel efficiencies in their fleet through electrification and the usage of alternative fuel sources. It currently has several light-duty electric service vehicles in the Greater Montreal Area and uses B20 biofuels on all trucks newer than 2012. To date, these initiatives have led to a savings of more than 1500 tonnes of C02.
Volvo Trucks hosted a Demo Day on April 13 at Coke Canada Bottling’s Montreal distribution center for delivery drivers to test drive the new battery-electric trucks. Participants learned ways to optimise the Volvo VNR Electric’s range, such as leveraging regenerative braking benefits to add power back to the battery.
The battery-electric fleet features a six-battery configuration that can cover up to 440 km (275 miles) on a single charge, as the trucks make several daily round trips of 150 km (93 miles) from the company’s distribution center in Montreal to customer locations.
To support charging its battery-electric fleet, Coke Canada Bottling is also installing three 150 kW DC chargers with nine dispensers at its Montreal distribution center. The charging infrastructure is anticipated to be complete in June 2023.
Coke Canada Bottling utilised federal and provincial incentives (Écocamionnage and the iMHZEV programs) for Heavy-Duty Zero-Emission Vehicles funding to offset the cost of the six Volvo VNR Electric trucks.
Coca-Cola HBC Finance B.V. has successfully issued its first green bond driven by strong investor demand, raising EUR 500m in support of its ambitious sustainability projects.
The net proceeds of the Green Bond will be allocated toward projects that meet the eligibility criteria outlined in the Group’s Green Finance Framework. They will accelerate progress of the company’s NetZeroby40 and Mission 2025 commitments, including: circularity, energy efficiency, water stewardship, biodiversity and community programmes, innovation in sustainable packaging, and support of sustainable agriculture and procurement.
This latest step is further evidence of Coca-Cola HBC’s determination to remain a leader in sustainability.
Commenting on the bond issue, Chief Financial Officer of Coca-Cola HBC, Ben Almanzar, said:“This milestone demonstrates that Sustainability is embedded in every aspect of our business, including our financing strategy. The issue of the Green Bond reinforces our position as Europe’s most sustainable beverage company. Most of all, it was made possible by the unmatched commitment of our teams to achieve net zero across our entire value chain by 2040.
The Coca-Cola Company announced that Jennifer Mann will become president of the company’s North America operating unit effective Jan. 1, 2023. Mann succeeds Alfredo Rivera, who will step down Dec. 31. Rivera, who has led a successful restructuring of the North America operating unit, will remain with the company as a senior advisor through March 2023.
Mann, 49, currently serves as corporate senior vice president and president of Global Ventures. Her team is responsible for globally scaling acquisitions and brands, including Costa Coffee and Coca-Cola’s investment in Monster Beverage Corp. A new leader for Global Ventures will be named at a later date.
Rivera, 61, has led the North America operating unit since August 2020.
About Jennifer Mann
Mann joined Coca-Cola in 1997 and went on to hold a number of roles of increasing responsibility. She became president of Global Ventures in 2019.
Prior to her role with Global Ventures, Mann served as chief people officer for the company and as chief of staff for Quincey. From 2012 to 2015, she was vice president and general manager of Coca-Cola Freestyle, where she accelerated the global expansion of Freestyle and led its development across the Coca-Cola system.
Mann’s first role with the company was as a manager in the National Customer Support division of North America. She went on to hold various customer and operational roles, including director, McDonald’s Customer & Consumer Operations; director, Good Answer; and vice president, Foodservice & On-Premise Strategy and Marketing for Coca-Cola Refreshments.
Mann is a member of the board of directors of Coca-Cola Consolidated. Mann holds a degree in accounting from Georgia State University.
Brown-Forman Corporation and The Coca-Cola Company announced a global relationship to debut the iconic Jack & Coke cocktail as a branded, ready-to-drink (RTD) pre-mixed cocktail option.
Jack Daniel’s & Coca-Cola RTD, inspired by the classic bar cocktail, will be made with Jack Daniel’s Tennessee Whiskey and Coca-Cola. The beverage will be available in markets around the world, with initial launch planned for Mexico in late 2022.
The can and packaging, which will feature two of the world’s most recognizable and valuable trademarks in Coca-Cola and Jack Daniel’s, will include clear responsibility symbols stating that it is to be enjoyed only by consumers of legal drinking age. Jack Daniel’s & Coca-Cola RTDs will adhere to responsible marketing practices held by Brown-Forman and The Coca-Cola Company.
The global benchmark for alcohol beverage volume (ABV) is 5 % but will vary depending on the market. A zero sugar version of the beverage will also be available.
HONEST Kids to remain in company’s portfolio, with HONEST teas product line to be phased out
The Coca-Cola Company is challenging itself to think differently about how its brands help accelerate business transformation, reflect consumer choice and promote growth as a company. This means rationalising its lineup of drinks and prioritising fewer, bigger brands with the greatest potential for scale and profitable growth.
While the HONEST Kids portfolio is quickly growing and will remain a successful part of the business, the HONEST teas product line will be phased out of The Coca-Cola Company’s beverage portfolio at the end of 2022.
Gold Peak, a national brand, and the regional Peace Tea offering will now anchor the company’s ready-to-drink tea (RTD) strategy in North America.
“Shifting from a three-brand tea portfolio to a prioritised two-brand tea lineup will free up investment resources and supply chain capacity to better meet consumer needs and capture share in the category,” said Sabrina Tandon, group director, RTD Tea, Coca-Cola North America Operating Unit. “We believe Gold Peak and Peace Tea are best positioned to meet consumer preferences for high-quality brewed teas with different levels of sweetness and flavour.”
The Coca-Cola system will continue to produce and distribute the HONEST Kids line of organic juice drinks and explore licensing ventures and innovation opportunities for the HONEST brand in other categories. “We are phasing out the HONEST teas product line, but are not selling the HONEST brand,” Tandon clarified.
Gold Peak launched in 2006 and became a billion-dollar brand in 2015. The brand transitioned to a real-brewed formula in 2018, appealing to “tea truists” who value tea-forward taste profiles and high-quality ingredients.
Peace Tea has built a loyal, Gen Z following in the Midwest, Northeast and Southeast with fruit-forward flavours offered in colourful, 23-oz. cans and a fun, free-spirited personality.
Mainstream brands like Gold Peak and Peace Tea are driving growth of the RTD tea category. Sales of both Gold Peak and Peace Tea have increased during the COVID-19 pandemic as shoppers gravitate both to beverages with immune-boosting properties and multi-serve packaging options for at-home consumption. HONEST teas, which are primarily offered in single-serve bottles with a strong concentration in the Northeast and along the West Coast, have been negatively impacted by a drop in immediate consumption sales and limited glass supplies.
“Ongoing supply chain challenges mean we are having to prioritise production and distribution of certain product SKUs, and that we’ve been unable to meet consumer demand for Gold Peak,” Tandon added. “This, among other factors, helped drive this very difficult decision.”
Tandon also cited some overlap among Gold Peak and HONEST tea consumers, adding, “We see endless runway with Gold Peak and are excited to expand the trademark with new product and packaging innovations that will appeal to the HONEST Tea consumer.”
The HONEST brand was founded in 1998 by Seth Goldman and Barry Nalebuff. In 2008, The Coca-Cola Company took a 40 % investment stake in HONEST before fully acquiring the brand in 2011.
Tandon credits HONEST tea with helping the company create a new route to market into the natural foods channel, where brands like Simply, Topo Chico, vitaminwater and smartwater remain.
Simply Spiked Lemonade, Molson Coors Beverage Company’s latest collab with The Coca-Cola Company, is set to hit shelves in the U.S. this June.
The flavoured malt beverage segment is growing, up 11 % in dollar sales between 2020 and 2021, according to IRI. Moreover, the lemonade-flavour subsegment is exploding, up 49 % since 2018, with more than USD 254 million in dollar sales, according to IRI.
Known for its real, high-quality juices and variety of flavours, Simply Lemonade is the nation’s best-selling refrigerated lemonade. It is found in half of American households and already is routinely used by consumers to make cocktails. Simply Spiked Lemonade products check in at 5 % alcohol by volume and are made with real fruit juice.
It will launch in variety packs of 12-ounce slim cans featuring four flavours: Signature Lemonade, Strawberry Lemonade, Watermelon Lemonade and Blueberry Lemonade. Select flavours also will be available in stand-alone 24-ounce cans.
Simply Spiked Lemonade is the latest collaboration between Molson Coors and The Coca-Cola Company, which also combined to turn Topo Chico Hard Seltzer into a top-4 hard seltzer in the U.S. market. Topo Chico Hard Seltzer went national earlier this year, and the brand recently launched Topo Chico Ranch Water Hard Seltzer and Topo Chico Margarita Hard Seltzer.
Coca-Cola Europacific Partners France (CCEP France) has announced an investment of EUR 30 million in its Dunkirk site, to fund a new production line that will increase the site’s capacity. The site already employs 400 people and bottles 10 different beverage brands. The investment will create at least 10 new jobs.
The Dunkirk site is the newest and largest CCEP site in France with lines producing all types of packs and sizes, and aseptic production which is used to manufacture still drinks – such as juices, teas and sports drinks. The site produces more than 600 million litres of beverages each year.
Since 2018, CCEP France has invested more than EUR 100 million to transform the Dunkirk site.
The Dunkirk site is committed to responsible growth and is taking measures to improve its carbon footprint, in line with CCEP’s net zero 2040 ambition and GHG emissions reduction target. For example, the site has set up an innovative device to replace plastic packaging on batches of cans with cardboard packaging, and 100 % of the waste created at the site is recycled or recovered.
The site also runs the Coca-Cola ‘Passport to Employment’ programme which benefits 400 young people from the Hauts-de-France region each year, and over 25,000 in France since its inception in 2003.
CCEP has been operating in France for more than 100 years, producing 90 % of the beverages in its portfolio locally and has invested EUR 350 million from 2009 to 2019 to strengthen its manufacturing capacity in the country.
Following its announcement on 12 August 2021, Coca-Cola HBC AG (“Coca-Cola HBC”) announced the completion of the acquisition by its wholly-owned subsidiary, Coca-Cola HBC Holdings BV (“CCH Holdings”), of approximately 52.7 % of Coca-Cola Bottling Company of Egypt S.A.E. (“CCBCE”) from MAC Beverages Limited (“MBL”) and certain of its affiliated parties for cash consideration of US$304 million, subject to certain balance sheet adjustments. An additional earnout amount may be payable based on CCBCE’s financial performance in 2021. Mr. Abdul Galil Besher, the current executive chairman of CCBCE, will remain as non-executive chairman of CCBCE. The transaction with MBL also involves the potential acquisition by CCH Holdings, at the same price per share to be paid to MBL, of another approximately 2.8 % stake from certain other minority shareholders pursuant to agreements to be entered into in due course.
In addition, a convertible loan issued to a wholly-owned affiliate of The Coca-Cola Company (the “TCCC Seller”) by CCBCE, convertible into new CCBCE shares, has been transferred to CCH Holdings for a cash consideration of approximately US$22 million (which is equal to its outstanding principal amount and unpaid interest).
Completion of the acquisition by CCH Holdings of approximately 42 % of CCBCE from the TCCC Seller, also announced on 12 August 2021, is expected to occur later this month, bringing CCH Holdings’ total ownership in CCBCE to 94.7 %.
The acquisition gives Coca-Cola HBC access to the second-largest non-alcoholic ready-to-drink (“NARTD”) market in Africa by volume, building on existing scale in Africa and increasing Coca-Cola HBC’s exposure to high growth geographies. There is a significant opportunity to leverage Coca-Cola HBC’s proven route-to-market capabilities and 70 years of experience operating in emerging markets to increase penetration of The Coca-Cola Company’s brand portfolio and drive category leadership.
The Coca‑Cola Company’s sustainable packaging journey crosses a major milestone this week with the unveiling of its first-ever beverage bottle made from 100 % plant-based plastic, excluding the cap and label, that has been made using technologies that are ready for commercial scale. The prototype bottle comes more than a decade after the company’s PlantBottle™ debuted as the world’s first recyclable PET plastic bottle made with up to 30 % plant-based material. A limited run of approximately 900 of the prototype bottles have been produced.
“We have been working with technology partners for many years to develop the right technologies to create a bottle with 100 % plant-based content—aiming for the lowest possible carbon footprint—and it’s exciting that we have reached a point where these technologies exist and can be scaled by participants in the value chain,” said Nancy Quan, Chief Technical and Innovation Officer, The Coca‑Cola Company.
PET, the world’s most recycled plastic, comprises two molecules: approximately 30 % monoethylene glycol (MEG) and 70 % terephthalic acid (PTA). The original PlantBottle™, introduced in 2009, includes MEG from sugarcane, but the PTA has been from oil-based sources until now. PlantBottle™ packaging looks, functions and recycles like traditional PET but has a lighter footprint on the planet and its resources.
Coca-Cola’s new prototype plant-based bottle is made from plant-based paraxylene (bPX) – using a new process by Virent – which has been converted to plant-based terephthalic acid (bPTA). As the first beverage packaging material resulting from bPX produced at demonstration scale, this new technology signals a step-change in the commercial viability of the biomaterial. The bPX for this bottle was produced using sugar from corn, though the process lends itself to flexibility in feedstock.
The second breakthrough technology, which The Coca-Cola Company co-owns with Changchun Meihe Science & Technology, streamlines the bMEG production process and also allows for flexibility in feedstock, meaning more types of renewable materials can be used. Typically, bMEG is produced by converting sugarcane or corn into bioethanol as an intermediate, which is subsequently converted to bioethylene glycol. Now, sugar sources can directly produce MEG, resulting in a simpler process. UPM, the technology’s first licensee, is currently building a full-scale commercial facility in Germany to convert certified, sustainably sourced hardwood feedstock taken from sawmill and other wood industry side-streams to bMEG. This marks a significant milestone toward the commercialization of the technology.
“The inherent challenge with going through bioethanol is that you are competing with fuel,” said Dana Breed, Global R&D Director, Packaging and Sustainability, The Coca-Cola Company. “We needed a next-generation MEG solution that addressed this challenge, but also one that could use second generation feedstock like forestry waste or agricultural byproducts. Our goal for plant-based PET is to use surplus agricultural products to minimize carbon footprint, so the combination of technologies brought by the partners for commercialization is an ideal fit with this strategy.”
In 2015, Coca-Cola unveiled its first prototype for a 100 % bio-based PlantBottle™ at the Milan Expo using lab-scale production methods to produce bPX. This next-generation 100 % plant-based bottle, however, has been made using new technologies to produce both biochemicals that make the bottle and are ready for commercial scaling.
Since introducing PlantBottle™, Coca-Cola has allowed non-competitive companies to use the technology and brand in their products—from Heinz Ketchup to the fabric interior in Ford Fusion hybrid cars. In 2018, the company opened up the PlantBottle™ IP more broadly to competitors in the beverage industry to scale up demand and drive down pricing.
As part of its World Without Waste vision, Coca-Cola is working to make all its packaging more sustainable, including maximizing use of recycled and renewable content while minimizing use of virgin, fossil material. The company has pledged to collect back the equivalent of every bottle it sells by 2030, so none of its packaging ends up as waste and old bottles are recycled into new ones; to make 100 % of its packaging recyclable; and to ensure 50% of its packaging comes from recycled material.
This innovation supports the World Without Waste vision, specifically the recently announced target to use 3 million tons less of virgin plastic from oil-based sources by 2025. The Coca‑Cola Company will pursue this 20 % reduction by investing in new recycling technologies like enhanced recycling, packaging improvements such as light-weighting, alternative business models such as refillable, dispensed and fountain systems, as well as the development of new renewable materials.
In Europe and Japan, Coca-Cola, with its bottling partners, aims to eliminate the use of oil-based virgin PET from plastic bottles altogether by 2030, using only recycled or renewable materials. While the majority of plastic packaging material will come from mechanically recycled content, some “virgin” material will still be needed to maintain quality standards. That’s why Coca-Cola is investing in and driving innovation to boost the supply of feedstock from renewable technologies as well as from enhanced recycling technologies. Enhanced recycling “upcycles” previously used PET plastics of any quality to high quality, food grade PET.
“We are taking significant steps to reduce use of ‘virgin’, oil-based plastic, as we work toward a circular economy and in support of a shared ambition of net-zero carbon emissions by 2050,” Quan said. “We see plant-based plastics as playing a critical role in our overall PET mix in the future, supporting our objectives to reduce our carbon footprint, reduce our reliance on ‘virgin’ fossil fuels and boost collection of PET in support of a circular economy.”
Refresco, the world’s largest independent bottler for retailers and A-brands in Europe and North America, announces it has entered into an agreement with The Coca-Cola Company to acquire three of its production locations in the United States. This transaction is subject to regulatory approval.
Hans Roelofs, CEO Refresco, comments: “The ongoing trend of A-brands outsourcing their production capabilities continues to provide opportunities for us as an independent beverage solutions provider. With manufacturing and supply chain being at the heart of our business, the acquisition of three Coca-Cola facilities in the US is another step forward in our growth strategy.”
Brad Goist, COO Refresco North America, adds: “Adding three hotfill production sites to our footprint is a great opportunity to further enhance our offering. I am convinced that our Retail and A-brand customers across North America will be able to benefit from our extended capabilities and broadened geographical footprint.”
The prospective transaction includes three production facilities in Truesdale (Missouri), Waco (Texas) and Paw Paw (Michigan), and involves long-term agreements for contract manufacturing activities. Refresco will become one of Coca-Cola’s strategic third-party contract manufacturers in the United States.
Strategic rationale
This acquisition is well aligned with Refresco’s buy-and-build strategy, focused on further expanding and strengthening its manufacturing footprint across Europe and North America to service both retailers and A-brands.
All three hotfill production locations are highly complementary to Refresco North America’s current manufacturing footprint. Through the acquisition, Refresco further improves its proximity to its existing customer base and expands its technological capabilities.
Transaction highlights
- The transaction is subject to regulatory approval.
- Refresco will finance the transaction from its existing cash position.
- The financial terms of the transaction are not disclosed.
Following today’s (16 June 2021) news that Ronaldo’s dismissal of Coca-Cola at a press conference temporarily cost the brand $4bn off its market value;
Khalid Peerbaccus, Senior Consumer Researcher at GlobalData, a leading data and analytics company, offers his view:
“While the power of product placement cannot be denied, Ronaldo’s rejection of Coca-Cola in favour of a bottle of water – and the temporary impact this had on the market value of Coca-Cola – could also be due to the ambiguity that some consumers may have toward carbonated drinks.
“Ronaldo’s decision to shine the spotlight on water rather than Coca-Cola is one that may resonate with *57 % of consumers globally who say that, in the current situation, a product’s health and wellbeing claims has the greatest influence on their purchase choice – as well as a further **28 % who admit that this somewhat affects their decisions. That Ronaldo is a prominent sports figure further adds weight to his promotion of water over the soft drink, as many view and trust him as a symbol of health that is necessary for his athletic accomplishments.
“The temporary drop and subsequent recovery of Coca-Cola’s market value is an important reminder of the power of celebrity endorsement, or lack thereof: particularly when a product has, in recent years, received ‘bad press’ as with high-sugar fizzy drinks.
“The move has already spurred a similar instance where Paul Pogba removed a bottle of Heineken beer from display at a press conference. While these acts may temporarily impact the market value of brands due to impressionable fans of the players, the long-term impact on these well-established brands is yet to be seen. What it does highlight is that the placement of such products at sporting events is at odds with the perception of health that the athletes embody.”
*GlobalData survey asked how the product/service impacts my health and wellbeing. Combined responses: ‘Always’ or ‘Often’ in the current situation
**GlobalData’s 2021 Q1 Global Consumer Survey – Global
Although energy drinks have witnessed steady year-on-year (YOY) growth in the US recently, Coca-Cola has decided to discontinue its Coca-Cola Energy brand after 17 months in the market, in a bid to sharpen its product portfolio – a move that highlights the gap in the market for hybrid innovations, writes GlobalData, a leading data and analytics company.
Holly Inglis, Beverages Analyst at GlobalData comments: “Coca-Cola Energy’s launch in the US was long awaited; despite the US market size, it was one of the latter markets to begin sales after many regions in Europe. At a time where the energy drinks market is flourishing, it is interesting that Coca-Cola has chosen to pause sales of a potential future cash cow.”
According to GlobalData, the US energy drinks market grew by 10 % in 2020* and was buoyed by a flurry of innovations such as Monster Mule ginger flavoured drink or Moonlight Wingman Smart Energy. Despite COVID-19 lockdown restrictions throughout the year, the category remained a key purchase choice for many consumers across the country.
In GlobalData’s latest survey, 73 %** of US consumers stated that energy boosting ingredients are nice to have, or essential to purchasing decisions. Interestingly, this comes at a time where health and wellness trends are prevailing and where energy drinks have, in the past, come under scrutiny for high sugar and unfavourable additive content. Manufacturers have worked to offset this by adding functional claims or unique flavour innovations to their beverages.
Inglis continues: “GlobalData’s survey found that 82 % of US consumers stated that immunity boosting ingredients have a positive influence on their purchasing decisions***, reinforcing that there is opportunity for beverage manufacturers to innovate energy drinks products that combine health and wellness claims with energy-boosting ingredients. The US energy drink market is highly competitive, so it is important that producers stay ahead of the curve in terms of beverage trends. It is plausible that Coca-Cola’s energy drink line risked falling behind in the long-term, due to a lack of flavour dynamics and health-halo claims.”
Despite COVID-19 restrictions across much of 2020, the US energy drinks market grew by a sizeable share and is expected to maintain a similar fate in 2021. Consumption from home is the new norm, and producers will continue to innovate retail offerings that promote this trend. Continued drive towards digestive health will persist, reflecting high potential for hybrid innovations that combine natural energy boosting ingredients with added vitamins and gut health claims.
*Data taken from GlobalData’s Annual Soft Market Analyser – US
**GlobalData’s Q1-21 Consumer Survey Results – North America
***GlobalData’s Q1-21 Consumer Survey Results – North America – Combined responses: “Essential / Key driver of purchase” and “It is nice to have”
Following the news that the Coca-Cola Company is trialling its first paper bottle; Alice Popple, Consumer Analyst at GlobalData, a leading data and analytics company, offers her view:
“Coca-Cola trialling a new paper bottle comes as no surprise as there has been an increase in sustainability initiatives from brands attempting to revamp strategy and ensure longevity post COVID-19. Brand’s sustainability initiatives will be vital in the future as GlobalData’s research reveals that nearly half (48 %)1 of global shoppers view ‘plastic-free packaging’ claims to be more important to them now, than before the COVID-19 pandemic, with 13 %1 claiming that it is a top priority.
“Last year saw a decline in revenue for Coca-Cola as a result of the COVID-19 pandemic2, therefore a strategy switch up is necessary to boost sales and interest in the brand. One in three (31 %)3 of global consumers say that they have stopped or are buying less carbonated soft drinks than before the pandemic – a main reason for this may be the excess of single-use plastic in the sector, aligning to the high degree of importance that plastic free packaging is currently experiencing.
“Joining the zero-waste initiative is vital for consumer satisfaction in 2021, with over a third (36 %)1 of global shoppers being specifically interested in a brand’s new sustainability initiatives following the pandemic. Coca-Cola’s trial of its first paper bottle will stem other market leaders to follow suit.”
1GlobalData’s Coronavirus (COVID-19) Recovery Consumer Survey Results: Week 11 – Global (Published 9th December 2020) – Combined responses: “It is now my top priority”, “It is significantly more important to me”, and “It is slightly more important to me”
2GlobalData’s Coronavirus (COVID-19) Company Impact: Coca-Cola H2 Update
3GlobalData’s Coronavirus (COVID-19) Recovery Consumer Survey Results: Week 11 – Global (Published 9th December 2020) – Combined responses: “I have stopped buying this”, “I am buying significantly lower quantities than before”, and “I am buying slightly lower quantities than before”
Coca-Cola in Europe will trial its first ever paper bottle prototype. The move marks a further step in fulfilling The Coca-Cola Company’s global vision of achieving a “World Without Waste”, in which the Company has pledged to ensure all of its packaging is collected, recycled or re-used by 2030.
The new paper bottle prototype has been developed through a partnership between scientists at the Coca-Cola Research and Development Laboratories in Brussels and The Paper Bottle Company (Paboco).The technology developed by Paboco is designed to create 100 % recyclable bottles made of sustainably sourced wood with a bio-based material barrier capable of resisting liquids, CO2 and oxygen, and suitable for liquid goods such as carbonated and still drinks, beauty products and more. The current prototype consists of a paper shell with a recyclable* plastic lining and cap. The ultimate goal is a bottle that can be recycled as paper.
“The trial we are announcing today is a milestone for us in our quest to develop a paper bottle”, said Daniela Zahariea, Director of Technical Supply Chain & Innovation for Coca-Cola Europe. “People expect Coca-Cola to develop and bring to market new, innovative and sustainable types of packaging. That’s why we are partnering with experts like Paboco, experimenting openly and conducting this first in-market trial. It’s part of delivering on our World Without Waste commitments.”
The trial is scheduled to take place in the second quarter of this year and will involve the Company’s plant-based AdeZ drink being offered to 2,000 consumers in Hungary, through a partnership with Kifli.hu – one of Hungary’s fastest growing online grocery retailers.
The launch is an important step in seeing how the paper bottle prototype performs and how consumers react, according to Coca-Cola Europe’s Stijn Franssen, R&D Packaging Innovation Manager. The paper bottle prototype is 100 % recyclable* and currently consists of a paper shell, with a recyclable plastic lining and cap. Mr Franssen said the Company’s partnership with Paboco is focused on developing a paper bottle than can be fully recycled as paper.
“This trial will provide us with invaluable insight and feedback”, said Mr Franssen. “We will get to see how the paper bottle prototype performs as packaging and what consumers think and feel about it. This is an exciting step forward for us, as it means we’re out of the lab and into the real world. So for the first time, consumers will actually be drinking one of our products from a potentially new type of paper packaging”, he added.
*where technology is available
Investing in new technology that lets consumers make and pour their drink at the push of a button.
Coca-Cola European Partners (CCEP), the world’s largest independent Coca-Cola bottler, has completed an investment in Lavit, a leading maker of multi-beverage, counter-top dispensing machines.
Using globally patented technology, the Lavit system lets consumers make and pour their drink in seconds, by dispensing a range of cold beverage options “on-demand” at the tap of a button and offering customisation of beverages based on carbonation and flavour. Since commercialisation, Lavit has a growing network of customers in the US and Canada.
The partnership with Lavit will further CCEP’s intent to explore and test new dispensed delivery solutions as a key strategic route towards eliminating packaging waste and reducing its carbon footprint, while providing consumers with the convenience, choice and experience they expect from drinking Coca-Cola beverages.
The funding and partnership with CCEP will help Lavit test and develop new product capabilities and explore growth opportunities by gaining further insight into customer and consumer demand for dispensed delivery solutions. It follows CCEP Ventures’ recent acquisition of a 25 % stake in Innovative Tap Solutions (ITS), investing in the company’s self-pour, self-pay drink dispensing technology.
The investment in Lavit was led by CCEP Ventures – the innovation engine and investment arm of Coca-Cola European Partners. It builds on previous investments in disruptive, technologically advanced companies and start-ups that enable CCEP to explore new ways to bring innovation into its delivery model and consumer experience.
Coca-Cola European Partners (CCEP) is set to accelerate the decarbonisation of its business by reducing absolute greenhouse gas (GHG) emissions across its entire value chain – including scope 1, 2 and 3 emissions – by 30 % by 2030 (vs 2019)* and setting a path to become a Net Zero business by 2040, in alignment with a 1.5˚C pathway and the Paris Climate Agreement.
CCEP will reduce GHG emissions across all five areas of its value chain – ingredients, packaging, operations, transportation and refrigeration. Crucially, there is a significant focus on reducing scope 3 emissions via a commitment to support strategic suppliers to set their own science-based carbon reduction targets and use 100 % renewable electricity.
CCEP’s immediate action plan is supported by a three-year €250m investment which will provide targeted financial support to decarbonise its business. This includes sustainable packaging initiatives, such as the progression of its 100 % rPET roadmap and investing in the scaling of depolymerisation technology, which will help accelerate the delivery of its longer-term net-zero objectives.
The ambition is underpinned by the inclusion of a GHG emissions reduction target in CCEP’s long term management incentive plan (LTIP) – 15 % of the LTIP awarded in 2020 will be based on the extent to which CCEP reduces GHG emissions over the next three years.
It builds on work undertaken over the last decade to reduce GHG emissions across CCEP’s entire value chain by 30.5 % (vs 2010) as part of This is Forward, its joint sustainability plan with Coca-Cola in Western Europe. CCEP’s 2030 GHG reduction commitment has been approved by the Science-Based Targets initiative (SBTi) as being in line with a 1.5˚C reduction pathway as recommended by the Intergovernmental Panel on Climate Change (IPCC).
As part of its journey to Net Zero, CCEP will invest in projects which remove carbon from the atmosphere or verified carbon offset projects. However it will focus on reducing emissions as far as possible and will only offset where essential and where it can’t reduce emissions any further.
*This includes a commitment to reduce Scope 1 and 2 GHG emissions by 47 % and Scope 3 emissions 29 % by 2030 from a 2019 base year.
On 3 November 2020, Coca-Cola European Partners announced it has entered into binding agreements to acquire Coca-Cola Amatil Limited (CCL), one of the largest bottlers and distributors of ready-to-drink non alcoholic and alcoholic beverages and coffee in the Asia Pacific region.
“This is a fantastic opportunity to bring together two of the world’s best bottlers to drive faster and more sustainable growth. Since the creation of CCEP four years ago, we have proven our ability to create value through expansion and integration. Now is the right time to move forward by taking on these great franchises and markets.
“The strategic rationale behind this transaction is compelling, solidifying our position as the largest Coca-Cola bottler by revenue. I am eager to apply our proven formula in Western Europe to Coca-Cola Amatil’s markets, including leadership in areas such as revenue growth management, in-market execution, digital and sustainability. However, I am equally excited and genuinely convinced that there will be many more opportunities as we move forward together with speed, scale, excellent people and a richer, more diverse culture.
“This larger platform will unlock enhanced value for our shareholders, all underpinned by an even stronger and more aligned strategic partnership with The Coca-Cola Company and our other brand partners. We look forward to executing on the ambitious growth plans ahead of us, as we build on the best of who we are and create a very exciting future together.”
Damian Gammell
CEO, Coca-Cola European Partners
Coca-Cola European Partners announced the introduction of CanCollar®, an innovative paperboard packaging solution, for multipack cans in Spain. The move supports its work, in partnership with Coca-Cola, to remove all unnecessary or hard to recycle plastic from its portfolio, avoiding the use of more than 11,000 tonnes of virgin plastic a year across Western Europe.
Initially, Coca-Cola European Partners will launch the new, PEFC certified1 recyclable and sustainably sourced paperboard CanCollar® in the Balearic Islands in November 2020, a first in Europe.
Innovative packaging design is a core principle of Coca-Cola’s World Without Waste strategy and through collaboration with WestRock, a global company that provides its customers with sustainable differentiated packaging solutions, Coca-Cola European Partners will start to use the CanCollar® paperboard can ring technology in the Balearic Islands, replacing the current Hi-cone solution and saving more than 18 tonnes of plastic annually.
Coca-Cola European Partners has invested 2.6 million euros in its Barcelona plant to support this initiative. The installation of WestRock’s CanCollar® Fortuna™ manufacturing equipment will enable multipack cans to be grouped in a sustainable and environmentally friendly way, with a process that does not require the use of glue or adhesives.
1PEFC, the Programme for the Endorsement of Forest Certification, is a leading global alliance of national forest certification systems. As an international non-profit, non-governmental organization, PEFC is dedicated to promoting sustainable forest management through independent third-party certification.
Coca-Cola European Partners funds dispensed delivery innovation with investment in self-pour, self-pay drink dispense technology leaders Innovative Tap Solutions
CCEP Ventures, the investment arm of Coca-Cola European Partners, has acquired a 25 % stake in Innovative Tap Solutions (ITS) – the creators of technology that enables consumers to pour their own beverages and increase efficiencies for the hospitality industry. Branded Strategic Hospitality, an investment & solutions platform headquartered in New York City, also participated in the investment in ITS alongside CCEP.
The investment will see CCEP work with ITS to introduce self-pour dispense technology to CCEP’s customers in Western Europe, beginning with a trial in Spain. ITS’s technology allows consumers to pour and pay for drinks themselves – cutting down queues, reducing the need for unnecessary contact and wait times and freeing up serving staff.
The partnership also represents a further step forward for CCEP’s Action on Packaging strategy, launched in 2017. CCEP is committed to investing and innovating in refillable and dispensed delivery models to eliminate packaging waste and lower its carbon footprint. CCEP is looking at developing suitable dispensed solution for different environments, and the partnership with ITS is a key part of this.
This agreement forms part of the wider CCEP Ventures programme – which aims to find, fund and nurture new technology and innovation.
Nik Jhangiani, Chief Financial Officer at CCEP, said: “We are committed to supporting package-free technology and finding new ways to help our customers increase value and provide a better experience to consumers. ITS is an exciting and ambitious business. We are confident we can help them expand successfully into the soft drinks category and grow their presence in Western Europe.”
Josh Goodman, Founder & CEO of ITS, commented on the partnership: “We’re excited to take this Self Pour Revolution to the next level with CCEP. Less than 5 years ago, our company was just me and one other person and our focus was just self-pour taprooms dispensing beer, wine and cocktails through our technology.
The market has spoken, customers and business owners love the concept, the efficiency and experience. We’re a liquid-agnostic company that wants to grow in the non-alcoholic space. Our partnership with CCEP ensures that we can continue investing in our technology to scale with the increasing demand.”
Company to establish new operating units and global beverage category leads, supported by new platform services organization
Workforce to be aligned to focus on growth; reductions expected through voluntary and involuntary separation program
The Coca-Cola Company announced strategic steps to reorganize and better enable the Coca-Cola system to pursue its Beverages for Life strategy, with a portfolio of drinks that are positioned to capture growth in a fast-changing marketplace.
The company is building a networked global organization, combining the power of scale with the deep knowledge required to win locally. The company will create new operating units focused on regional and local execution that will work closely with five marketing category leadership teams that span the globe to rapidly scale ideas.
This structure will be supported by the company’s newly created Platform Services organization, which will provide global services and enhanced expertise across a range of critical capabilities.
“We have been on a multi-year journey to transform our organization,” said Chairman and CEO James Quincey. “The changes in our operating model will shift our marketing to drive more growth and put execution closer to customers and consumers while prioritizing a portfolio of strong brands and a disciplined innovation framework. As we implement these changes, we’re continuing to evolve our organization, which will include significant changes in the structure of our workforce.”
Operating units
The company’s nine new operating units will help streamline the organization by replacing current business units and groups. The operating units will be highly interconnected, with more consistency in structure and a focus on eliminating duplication of resources and scaling new products more quickly.
The company’s current model includes 17 business units that sit under four geographical segments, plus Global Ventures and Bottling Investments. Moving forward, the operational side of the business will consist of nine operating units that will sit under four geographical segments, along with Global Ventures and Bottling Investments.
The company’s operating leaders will report to President and Chief Operating Officer Brian Smith.
Global category leads
Innovation, marketing efficiency and effectiveness are top priorities for the company. The Coca-Cola Company is conducting a portfolio rationalization process that will lead to a tailored collection of global, regional and local brands with the potential for greater growth. To drive these initiatives and support the operating units, the company is reinforcing and deepening its leadership in five global categories with the strongest consumer opportunities:
- Coca-Cola
- Sparkling Flavors
- Hydration, Sports, Coffee and Tea
- Nutrition, Juice, Milk and Plant
- Emerging Categories
The leaders of these categories will work across the networked organization to build the company’s brand portfolio and win in the marketplace. Global category leads will report to Chief Marketing Officer Manolo Arroyo.
Platform Services
The company announced the creation of Platform Services, an organization that will work in service of operating units, categories and functions to create efficiencies and deliver capabilities at scale across the globe. This will include data management, consumer analytics, digital commerce and social/digital hubs.
Platform Services is designed to improve and scale functional expertise and provide consistent service, including for governance and transactional work. This will eliminate duplication of efforts across the company and is built to work in partnership with bottlers.
Platform Services will be led by Senior Vice President and Chief Information and Integrated Services Officer Barry Simpson.
Aligning the company’s workforce to new priorities
The company’s structural changes will result in the reallocation of some people and resources, which will include voluntary and involuntary reductions in employees. The company is working on this next stage of design and will share more information in the future.
In order to minimize the impact from these structural changes, the company today announced a voluntary separation program that will give employees the option of taking a separation package, if eligible.
The program will provide enhanced benefits and will first be offered to approximately 4,000 employees in the United States, Canada and Puerto Rico who have a most-recent hire date on or before Sept. 1, 2017. A similar program will be offered in many countries internationally. The voluntary program is expected to reduce the number of involuntary separations.
The company’s overall global severance programs are expected to incur expenses ranging from approximately $350 million to $550 million.
Coca-Cola European Partners (CCEP), the world’s largest independent Coca-Cola bottler, has taken an important step on its journey towards 100 % rPET for its plastic bottles by funding CuRe Technology – a recycling start-up which seeks to provide a new lease of life for difficult to recycle plastic polyester waste.
The funding from CCEP, through its innovation investment fund, CCEP Ventures, will enable CuRe to accelerate its ‘polyester rejuvenation’ technology from pilot plant to commercial readiness. Once the technology is commercialised, CCEP will receive the majority of the output from a CuRe-licensed, new-build plant.
Once operational, CuRe has the potential to support CCEP’s ambition, in partnership with The Coca-Cola Company in Western Europe, to eliminate virgin oil-based PET from its PET bottles within the next decade. This will contribute to removing of a total of over 200,000* tonnes of virgin oil-based PET from CCEP’s packaging portfolio a year and support the transition to a circular economy for PET packaging.
CuRe Technology – a start-up, created and led by a consortium of world-leading recycling innovators and experts led by the Morssinkhof Group and the Cumapol/DuFor Group, with strategic partners DSM-Niaga and NHL Stenden University of Applied Science – will initially apply its end-to-end partial depolymerisation recycling process to transform opaque and difficult to recycle (ODR) food grade PET to high quality recycled PET (rPET) that can be used again for food and drink packaging in one continuous process on the same site.
Towards a Circular Economy
The CuRe funding from CCEP Ventures builds on existing strategic investments by The Coca-Cola Company to explore and support the scaling of ‘enhanced’ full depolymerisation recycling technologies in order to make a circular economy for PET a reality.
Depolymerisation recycling technologies complement existing mechanical polymer recycling processes. They have the potential to upcycle lower grade PET that cannot currently be recycled via mechanical recycling means and is instead currently downcycled, incinerated or sent to landfill. These depolymerisation technologies could play a role in significantly increasing the supply of rPET whilst also accelerating the transition to a circular economy for PET bottles by reducing the reliance on virgin oil-based PET.
The Coca-Cola system in Western Europe is working towards a future source vision for its PET material which will help remove the need for virgin oil-based PET (figurative future sources of PET in Western Europe: 70 % derived from mechanical recycling with 25 % from depolyemrisation recycling and 5 % PET from plant-based renewable sources, all while remaining 100 % recyclable*).
About CuRe Technology
CuRe Technology uses a partial depolymerisation process – shortening the polymer chains just enough to allow the removal of many impurities and to rejuvenate food grade PET to high quality rPET – and can be less energy intensive than full depolymerisation offering lower associated C02 emissions. It’s like pressing a ‘reset’ button to partially break down plastic PET into its component building blocks to produce a high quality rPET. Due to the modularity of the process, the longer term ambition for this technology is to upcycle all polyester waste streams including product to product rejuvenation of carpets and textiles.
Joe Franses, Vice President, Sustainability at Coca-Cola European Partners said: “CuRe is an exciting technology start-up with transformational potential developed by an experienced consortium, making it an ideal investment for CCEP Ventures. Our investment in CuRe underlines our commitment to supporting innovations that have the potential to drive growth in our business and our sustainable packaging goals. It also offers us the potential to access vital rPET volume that will help to accelerate delivery of our 100% rPET ambition for our PET bottles.”
As part of their joint Sustainability Action Plan, This is Forward, Coca-Cola European Partners and Coca-Cola in Western Europe have pledged that by 2025, Coca-Cola will: collect a can or bottle for every one it sells and ensure that all its packaging is 100 % recyclable and by 2023 will: ensure that at least 50 % of the content of its PET bottles will come from recycled content, accelerating towards its ambition to use zero oil-based PET in its PET bottles in the future, using instead 100 % recycled or renewable content.
Josse Kunst, Chief Commercial Officer at CuRe Technology said: “Polyester is one of the world’s most reversible plastics and should not go to waste. In the pilot plant phase of the CuRe process, we were supported with a subsidy from the European Union and the three northern provinces of the Netherlands. Now our ambition to create an energy-efficient solution for product to product polyester transformation will be accelerated because of this funding.
The support of CCEP Ventures will enable us to start with opaque and difficult to recycle food grade PET and take the first step towards our ultimate vision of recycling all polyester, again and again.”
*By 2019, CCEP was already using 60,000 tonnes of rPET in its bottle and has committed to using 50% rPET by 2023.
Following the news that PepsiCo is set to buy Rockstar Energy Beverages; Andy Morton, Drinks Deputy Editor at GlobalData, a leading data and analytics company, offers his view:
“This agreement will fill a gaping hole in PepsiCo’s beverage portfolio just as The Coca-Cola Co looked to have the drop over its historic rival in global energy drinks.
“In recent years, Coca-Cola has taken a minority stake in Monster Energy owner Monster Beverage Corp and launched its own energy drink under the Coca-Cola brand. The moves targeted fast growth in energy that has stolen share from carbonated sodas such as Coke and Pepsi and threatened the traditional business strategies of the larger beverage multinationals.
“As Coca-Cola cosied up to Monster, PepsiCo’s lack of action in energy became more apparent. Energy offerings from PepsiCo so far have largely been from its Mountain Dew soft drinks brand, with niche consumers such as gamers served with the likes of Amp Game Fuel and athletes with a caffeinated version of Gatorade called Bolt24.
“The Rockstar acquisition hands PepsiCo an off-the-peg solution to its lack of a bespoke energy brand while offering new angles for those already in its portfolio. According to GlobalData, Rockstar accounts for just 4 % of the global energy drinks market by value, but the company offers a platform to bigger things.
“The purchase also sounds the starting gun for a new frontier in PepsiCo and Coca-Cola’s beverage war as the world’s biggest soda companies finally get serious in energy.
“For years, the global energy drinks market was dominated by the upstart Red Bull. Recently, however, Monster – buoyed by a sea of cash from domination in the US – has closed the gap by stretching its tentacles beyond the country, with exports boosted by a distribution agreement with Coca-Cola. With Rockstar now set to join PepsiCo, it too could become a global player and expand beyond its current few dozen export markets.
“There’s much to play for – according to GlobalData, the global energy drinks market grew by 8.9 % in 2018, making it the fastest-growing category in non-alcoholic beverages. That growth was driven by Asia (+18.7 %), Eastern Europe (+16.9 %) and Africa (+14.0 %). China, meanwhile, became the world’s biggest energy drinks market after overtaking the US, signalling that the real action in the category lies beyond PepsiCo and Coca-Cola’s developed markets.
“Prepare to be buzzed – the energy drinks showdown is going global.”
A team of technical experts is helping Coca-Cola North America launch breakthrough beverages in emerging categories – from kombuchas, to cultured ciders, to keto-friendly smoothies, to cold-brew coffees – in record time.
The Transformational Innovation Team partners with brands and business units to take new drinks in unfamiliar spaces to commercialization in a handful of months. A rotating group of specialists from Research and Development (R&D), Quality, Safety & Environmental Sustainability, Technical Commercialization and Scientific and Regulatory Affairs (SRA) is helping the company navigate uncharted territory by challenging existing approaches to innovation – from sourcing and seeking approval on new ingredients, to producing beverages in emerging categories, to bringing new brands to market – through an agile, test- and-learn launch model.
“We combine the best of what entrepreneurs do and the best of what Coca-Cola does,” explains team lead Susan Zaripheh. “Entrepreneurs dream of having the power of our brands and scale of our distribution network, and large global companies like Coke want to be able to innovate quickly, iteratively and stay
competitive in emerging spaces.”
Inspiring a mindset shift
This means challenging organizational processes and breaking down boundaries. “Capability isn’t an issue at Coca-Cola,” Zaripheh says. “Our talent and people are top notch. What we’re trying to do is inspire a mindset shift and push the company into new or emerging segments consumers want us to explore.”
The Transformational Innovation Team has partnered with Minute Maid to develop several breakthrough products in 2019, including Cidewinder, which boasts similar digestive health benefits as kombucha but with less sugar. The cultured juice brand, which leveraged a novel ingredient and process from a third-party company, is being tested in grocery and convenience store outlets in Texas and California.
“Cidewinder is an example of how we’re moving quickly, but deliberately, by running small market tests before investing significant time or resources,” Zaripheh said. “Some of the brands we’re helping to launch will not reach scale, but that’s the point of what we’re doing. We’re pushing the company to move faster than ever and to use real-time market data to make informed decisions and gain important learnings for the future.”
Following the consumer
Odwalla, meanwhile, tapped Zaripheh’s team to help develop a zero-sugar, keto-friendly smoothie using trending ingredients like MCT oil and coconut cream – bringing the first-of-its-kind offering in the Coca-Cola portfolio to life in less than six months.
“Our partnership with the Transformational Innovation Team has added tremendous value to our decision making,” said John Hackett, president, Minute Maid Business Unit. “With their support, we’ve been able to test emerging spaces quickly and gain real-world learnings. Direct guidance from the market enables us to focus our investments on ideas and innovations that strongly resonate with consumers.”
The team also partnered with Honest to launch two category-crossing innovations – Honest Kombucha and Honest Cold Brew Co”ee. Honest is building a master brand beyond its core tea business and, as part of that strategy, decided in 2019 to enter the fast-growing – and complex – kombucha segment. “Part of the Honest brand’s strategy is to ‘own the fridge’ of the
Millennial family by offering lower- sugar, organic beverages for all occasions,” said Rafael Acevedo, vice president, Tea Portfolio, Coca-Cola North America. “Given the rising popularity of kombucha, it made sense for a brand known for making tea to enter this space.”
The Transformational Innovation Team helped Honest enter this space by end of the year in a limited, 20-store test, then quickly aligned on a brand proposition and execution strategy. Results are expected in early 2020.
‘Being nimble doesn’t mean cutting corners’
The teams also partnered to secure all required approvals in time to produce and ship samples of Honest Cold Brew Coffee to the Natural Products Expo East tradeshow in only 10 weeks. The brand received great feedback from attendees.
“That project was not a product development challenge – it was a regulatory and food safety challenge,” explained Zaripheh, a food scientist with a PhD in nutrition. “Low-acid beverages like coffee have significant food safety and regulatory hurdles which can take a ton of time, but we were able to do even more due diligence by taking a different approach.”
Acevedo called the collaboration “a great example of how the company is approaching innovation differently and prioritizing agility to achieve effcient results.”
However, Zaripheh insists, the team takes steps to move quickly without compromising safety or quality, or taking due-diligence shortcuts. “Being nimble doesn’t mean cutting corners… it means approaching challenges from different angles and finding ways to parallel-path and operate with flexibility,” she added. “We hear a lot about speed to market these days. But speed by itself isn’t a competitive advantage – anyone can go fast. The key is identifying potential big bets, starting small and learning before making significant investments and launching at scale. That’s what we do.”
Creating a ripple effect
This group of “intrapraneurs” is on a mission to create a ripple effect by sharing learnings with Coca-Cola North America teams leading innovation projects across the system.
“Power is not having one team dedicated to transformational innovation, but seamlessly implementing learnings and frameworks across the organization and fueling new capability to drive growth,” said Simon Yeung, SVP, Innovation and Stewardship, Coca-Cola North America, noting that the team consulted and shared learnings with the sparkling water team spearheading the AHA brand launch. “Our goal is to get the system to move faster and deliver more disruptive innovation… to take on meatier projects and platform-able ideas and bring them to life.”
The Coca-Cola Company has been present in France for the last 100 years, serving as a key contributor to the food and beverage industry. The Coca-Cola system has always been an integral part of the French economic ecosystem, especially through the production and distribution activities of bottling companies in the country.
The Coca-Cola Company and Coca-Cola European Partners (CCEP), the primary bottling partner in the country, together plan to invest as much as one billion euros behind the introduction of new products in the French market; the expansion of bottling capacity and modernization at CCEP’s manufacturing plants; innovations; and ongoing support of company brands. Both companies will support the hosting of the Paris 2024 Olympic Games, following the extension of a partnership between Coca-Cola and the IOC, which was announced in July 2019.
CCEP has earmarked €500 million to further strengthen its production and distribution network.
After investing €350 million since 2013, CCEP continues to invest to adapt its manufacturing network to changes in consumer preferences and to accelerate its transition to a circular economy, including packaging transformation.
For example, after adding a bottling line dedicated to glass bottles in 2019, CCEP will invest in the plant in Socx (Dunkerque) to equip the site with a state-of-the-art aseptic bottling line in mid-2020, which will enable CCEP to meet the increasing consumer demand for Fuze Tea, the ready-to-drink tea brand launched in 2018, and for Tropico, the juice drink company acquired by The Coca-Cola Company in September 2018. Additional investments across all five CCEP plants in France will enable the introduction of a higher quantity of recycled material in bottles and cans and the replacement of plastic by cardboard for secondary packaging.
The €500 million in investments will be progressively committed over the next five years in production and commercialization and will include a provision for CCEP to invest in new cooling equipment for its customers and in accelerating the company’s digitalization journey.
In parallel, The Coca-Cola Company will invest €500 million to support the development of its current brands and introduce new products in the French market.
Coca-Cola is evolving as a total beverage company that focuses on better satisfying consumer needs. Following the successful launch of Fuze Tea and the acquisition of Tropico in 2018, the company today confirmed its intent to strengthen its existing positions and accelerate its entry into new categories.
Coca-Cola will invest as much as €500 million in France over the next five years. These investments will be a combination of media, brand experiences or strategic partnerships, such as the support of the Paris 2024 Olympic Games.
Coca-Cola has rolled out a new energy drink – Coca-Cola Energy – in Vietnam as part of the company’s larger focus to evolve into a complete beverage company and offer the Vietnamese consumers a wide range of drinks to cater the different lifestyles and occasions, says GlobalData, a leading data and analytics company.
According to GlobalData’s 2018 Q4 Consumer Survey, around 41 % of Asia-Pacific (APAC) consumers prefer to experiment with new kind of soft drinks and around 40 % of them are willing to pay more for better quality soft drinks.
Shagun Sachdeva, Consumer Insights Analyst at GlobalData, says: “Soft drinks brands have been coming across increased competition amidst intensifying scrutiny of sugar-sweetened beverages and corresponding consumer efforts to make healthier choices. Against this backdrop, they are mapping out the wellness considerations for the products they are offering to attract a niche market of specialists such as sports enthusiast and athletes, whilst also appealing to the mainstream of active lifestylers.”
An analysis of GlobalData’s Market Analyzer reveals that APAC energy drinks market is expected to grow at a compound annual growth rate (CAGR) of 7.9 % from US$24.7bn in 2018 to US$36.2m in 2023. The Vietnamese energy drinks market is expected to reach US$1.46bn by 2023 from US$1.34bn in 2019.
Sachdeva adds: “Energy drinks have become a key thrust for Coca-Cola to rejuvenate growth in the APAC soft drinks market. The company is quick to understand that soft drinks category needs an image makeover. As a result, it is breaking the long-standing lead in Carbonated Soft Drinks (CSDs) by expanding its range of drinks portfolio to tap the correct set of active and time-scarce consumers and embracing innovation to sustain a highly competitive marketing profile.”
The other factors contributing to the emerging growth of the Vietnam energy drinks’ market are improving economic climate, socio-political stability and likelihood of stringent regulations as the Ministry of Finance has proposed a new sugar tax of 10% on sugary drinks from 2019.
Sachdeva concludes: “The launch comes at a time when most of the beverage companies are going beyond soda and there is growing competition in the carbonated market following the influx of countless other carbonated brands. Even though, Coca-Cola is already offering energy drinks under the brand name Monster, the company’s decision to launch energy drinks under its trademark will reinforce local identity, foster reassurance, create emotional resonance among the consumers and further deepen brand’s equity in Vietnam.”
The Coca-Cola Company reported a solid start to 2019, with continued momentum that included gaining global value share. Reported net revenues grew 5 % in the first quarter, and organic revenues (non-GAAP) grew 6 %, with positive performance across all operating groups, in addition to a benefit from timing.
“We’re encouraged by our first quarter results as our disciplined growth strategies continue to deliver strong underlying performance,” said James Quincey, CEO of The Coca-Cola Company. “We remain confident in our full year guidance as we continue to make progress on our transformation as a consumer-centric total beverage company.”
Highlights
Quarterly Performance
- Revenues: Net revenues grew 5% to $8.0 billion. Organic revenues (non-GAAP) grew 6 %. An estimated 2 points of revenue growth was attributable to timing, primarily related to bottler inventory build in order to manage uncertainty related to Brexit. Additionally, the quarter included one less day, which resulted in an approximate 1-point headwind to revenue growth.
- Margin: Operating margin for the quarter, which included items impacting comparability, was 29.1 % versus 23.7 % in the prior year. Comparable operating margin (non-GAAP) was 30.5 % versus 30.7 % in the prior year. Strong underlying margin (non-GAAP) expansion was offset by an approximate 260 basis point negative impact from currency headwinds and net acquisitions.
- Earnings per share: EPS from continuing operations grew 24 % to $0.38. Comparable EPS from continuing operations (non-GAAP) grew 2 % to $0.48, despite an 11-point currency headwind. EPS included an estimated 2 cent benefit from timing, primarily from the bottler inventory build related to Brexit.
- Market share: The company continued to gain value share in total nonalcoholic ready-to-drink (NARTD) beverages.
- Cash flow: Cash from operations was $699 million, up 14 %. Free cash flow (non-GAAP) was $335 million, down 1 % as strong underlying cash generation was offset by currency headwinds along with an increase in capital expenditures and cash tax payments.
- Share repurchases: Purchases of stock for treasury were $397 million. Net share repurchases (non-GAAP) totaled $243 million.
Company Updates
- Chairman transition and an evolving growth culture: Following the company’s annual meeting on April 24, James Quincey will become the 14th chairman of The Coca-Cola Company, contingent upon his reelection as a director. Quincey succeeds Muhtar Kent, who is retiring after a Coca-Cola system career that started in 1978. Kent served as chairman and CEO from 2009 until 2017 and then as chairman after Quincey became CEO. Quincey intends to build on the strong foundation Kent has established within the system, including a focus on fostering a growth-oriented culture.
- Pursuing the company’s World Without Waste goals: Supporting its commitment to the World Without Waste initiative and improved transparency, the company issued its annual progress report, which cited continued progress globally on design, collect and partner efforts. For example, the company, along with its bottling partners, now has 100 % recycled PET bottles in multiple markets and will have them in more than a dozen markets by the end of 2019, driving successful circular solutions for packaging. Much of the system’s Latin America business is engaged in a multi-country project to significantly increase the use of refillable packaging, and markets globally are assessing ways to move toward more diverse business models for product delivery.
- Broadening a consumer-centric portfolio: During the quarter, the company completed its acquisition of Costa Ltd., which gives Coca-Cola a significant entry point into hot beverages and a global platform in coffee. In the second quarter, the company will begin to leverage Costa’s scalable platform across formats and channels with the introduction of Costa ready-to-drink products. Coca-Cola also closed its acquisition of CHI Ltd., an innovative, fast-growing leader in expanding beverage categories in West Africa, including juices, value-added dairy and iced tea.
- Driving profitable growth under the Leader, Challenger, Explorer framework: Strong innovation within Leader brands included double-digit growth for Coca-Cola Zero Sugar globally for the sixth consecutive quarter. Within the U.S., the company showed strong performance for Orange Vanilla Coke and Orange Vanilla Coke Zero Sugar, which helped drive 6 % retail value growth for brand Coca-Cola. The company also launched Simply smoothies in the U.S., while innocent, the company’s leading juice brand in Europe, expanded into plant-based beverages. As a Challenger brand, smartwater continues to innovate through the successful rollout of smartwater antioxidant and smartwater alkaline in the U.S. Within Explorer brands, the company continued to capitalize on brands with edge, including Aquarius GlucoCharge, which has shown early signs of success in the fast-growing enhanced hydration category in India.
- Aligned and engaged system investing for growth: The company has established a sustained platform for performance that is focused on disciplined portfolio growth through an aligned and engaged system. Across the bottling system, the company is seeing the right strategic investments in supply chain, cold-drink equipment and sales force capabilities to drive accelerated results. These investments are creating a winning strategy in the marketplace, centered around improved execution that is committed to increasing the availability of core products, in addition to expanding the total portfolio.
Download the full earnings release (PDF)
Following the recent news that The Coca-Cola Company plans to relaunch its sports drink Powerade in India within the next two months as part of its strategy to compete with PepsiCo’s Gatorade, Shagun Sachdeva, Consumer Insights Analyst at GlobalData, a leading data and analytics company, offers her view:
“The news comes as no surprise as the demand for functional sports drinks is growing exponentially in India and resonates well with millennials. Coca-Cola, being one of the country’s leading beverage companies, is now looking to tap into this category and increase its non-aerated drinks portfolio.
“Coca-Cola has collaborated with ICC World Cup as official sponsor with an aim to compete with Gatorade-owner PepsiCo in India. The calculative strategy is a part of company’s larger focus to evolve into a total beverage company by investing around $5bn by 2020 and make India as its third largest market. This is the second time Coca-Cola is trying to launch Powerade in the country.
“Powerade, which registered billion dollar plus sales globally, is currently available in India through imports. GlobalData forecasts the Indian sports drink market to grow from US$2.81bn in 2017 to US$5.87bn by 2023, propped up by healthy and better-for-you functional beverage options.
“Coca-Cola has collaborated with ICC World Cup as an official sponsor with an aim to compete with Gatorade-owner PepsiCo in India. The calculative strategy is a part of the company’s larger focus to evolve into a total beverage company by investing around $5bn by 2020 and making India its third largest market. This is the second time Coca-Cola is trying to launch Powerade in the country.
The first energy drink under the Coca-Cola brand will launch in Europe in April, the company announced.
Coca-Cola Energy, which will debut in Spain and Hungary, features caffeine from naturally-derived sources, guarana extracts, B vitamins and no taurine – all with a great Coca-Cola taste and feeling that people know and love. A no-sugar, no-calorie option also will be available. Both will be offered in 250-ml cans.
As a total beverage company, Coca-Cola continues to evolve its portfolio to bring people more of the drinks they want – from organic teas, to juices, to enhanced waters, to ready-to-drink coffees, to new variants of Coca-Cola. The launch of Coca-Cola Energy is the latest articulation of this strategy.
A visual identity and marketing campaign will support the launch of Coca-Cola Energy, which is designed primarily for young adults, age 18 to 35. The new brand will be promoted in line with The Coca-Cola Company’s responsible marketing guidelines. These include, in line with UNESDA (European Soft Drink Association) guidelines, no sampling in proximity to primary and secondary schools and never promoting mixing with alcohol.
Coca-Cola European Partners (CCEP) will invest over EUR 500 million in 2019, as part of an ongoing multi-year EUR 1.5 billion investment programme.
The announcement was made at CAGNY Conference for investors in Miami. The programme focuses on delivering more for our customers by investing in new technology, supply chain capabilities and coolers.
Damian Gammell, Chief Executive Officer at Coca-Cola European Partners, said: “We’re investing in key areas of the business to make it easier for customers to do business with us, and to offer consumers a wider range of great products. Last year our targeted investment programme helped to create EUR 8.7 billion in value for customers – nearly EUR 600 million more than 2017.”
Next generation digital solutions
Making it easier for customers to do business with us by developing and investing in new digital solutions. Highlights include:
- Mobile sales tools which not only improve the customer experience but also increase productivity and optimise sell time
- New business analytics capabilities to improve promotions and forecasting with customers
- Expanding digital services for customers, such as Kollex, a recently established digital joint venture for the beverage wholesale trade and the away-from-home market in Germany
Boosting capabilities across our supply chain
Increasing capacity and capabilities to service our customers quickly and easily, and support our growing portfolio of drinks sustainably. Highlights include:
- New manufacturing lines in Halle, Mannheim, Barcelona, Seville, Ghent and Wakefield to provide consumers with a greater choice of products and packs
- Increasing the amount of recycled plastic in our products, such as the ongoing work with Ioniqa to transform hard to recycle plastic waste into high quality, food-grade PET
- Increasing capacity for refillable glass bottles and trialling new routes to market, such as our new partnership with Loop and Carrefour in France for returnable and refillable glass
Increasing product availability
Expand cold drink equipment, making it easier for consumers to find our drinks on the go. Highlights include:
- Placing 69,000 more coolers in customers’ outlets in 2019
- Better outlet targeting and segmentation through an expanded range of cooler sizes and types
CCEP Ventures
At CAGNY Conference, CCEP also announced the creation of an innovation investment programme.
The programme – CCEP Ventures – will focus solutions across customer experience and support, logistics and distribution, future packaging design and technology, prediction and pricing analytics
On the launch of CCEP Ventures, Mr Gammell said: “Our business faces future disruptive trends that need innovative solutions and we need to adapt and learn quickly. CCEP Ventures will help us bring the best minds and ideas from the outside world into our business. It will help us find, fund and foster new solutions and scale with speed.”
The Coca-Cola Company reported another quarter of solid operating performance, capping off strong financial results for the year. While reported net revenues declined due to refranchising and currency headwinds, the company delivered organic revenue (non-GAAP) growth within its long-term target for the sixth consecutive quarter, while also gaining value share globally.
“I am pleased with our strong organic revenue and earnings growth in 2018. Our results demonstrate progress in our transformation as a consumer-centric, total beverage company and the power of a more strategically aligned system,” said James Quincey, CEO of The Coca-Cola Company. “Coca-Cola has established a strong foundation to capitalize on long-term growth opportunities and drive sustained shareowner value.” …
Download the full earnings release (PDF)
Variety-seeking Coca-Cola fans will soon have a new fun-yet-familiar flavor to reach for.
Orange Vanilla Coke and Orange Vanilla Coke Zero Sugar – the first Coca-Cola trademark flavor innovations in over a decade – hit stores in the USA on Feb. 25 in a range of packaging options.
Kate Carpenter, brand director, Coca-Cola, said the 2016 launch of the One Brand strategy – which combined all Coca-Cola variants under a common visual identity and creative campaign – showcases the breadth of the brand. Following the successful relaunch of Coca-Cola Zero Sugar in 2017, the trademark team began to explore additional growth opportunities.
“What we realized is that we had a diamond in the rough when we looked at our flavors portfolio,” Carpenter said. “The growth of Cherry Coke and Vanilla Coke – and their zero-calorie variants – has been really strong in recent years even with very limited marketing support.”
Despite this growth, only 12 percent of Coca-Cola drinkers were reaching for flavors. “This showed us our fans want choice but are getting it outside the Coke Trademark,” Carpenter said. …
Source: www.coca-colacompany.com
Loop Industries, Inc., a leading technology innovator in sustainable plastic announced that they have entered into a multi-year supply framework with the Coca-Cola system’s Cross Enterprise Procurement Group (“CEPG”) to supply 100 % recycled and sustainable LoopT PET plastic (“LoopT PET”) from Loop’s joint venture facility with Indorama Ventures Limited in the United States to authorized Coca-Cola bottlers who enter into supply agreements with Loop. Indorama Ventures is a world-class chemicals company and a global integrated leader in PET and fibers serving major customers in diversified end-use markets.
“We are very proud to become a supplier of LoopT branded PET resin to the members of the Coca-Cola system’s Cross Enterprise Procurement Group,” said Daniel Solomita, Founder and CEO of Loop Industries. “We are especially pleased to be able to assist Coca-Cola’s authorized bottlers as they work to meet their recycled content ambitions.”
“Like all responsible companies, we need to be selective in choosing our packaging materials so that we continue to eliminate waste and work to reduce the environmental impact,” said Ron Lewis, Chief Supply Chain Officer, Coca-Cola European Partners, a bottler member of CEPG. “Investments like this one with Loop Industries support our goal to ensure that at least 50% of the material we use for our PET bottles comes from recycled plastic, and will help us divert more materials from landfills and build a stronger circular plastic economy.”
This arrangement continues the rapid and exciting progress ?being made by Loop as it commercializes its breakthrough depolymerization technology which will help reduce global plastic waste and enable major global brands to meet their sustainability goals. As the demand for sustainable packaging solutions continues to grow, Loop Industries has emerged with transformational technology that allows no and low value plastics to be diverted, recovered and recycled endlessly into new, virgin-quality LoopT PET plastic.
The Coca-Cola Company reported continued momentum in its business for 2018, with strong financial results for the third quarter. While reported net revenues for the quarter declined due to refranchising, the company delivered broad-based organic revenue (non-GAAP) and volume growth across all operating groups, while gaining value share globally.
Strong organic revenue (non-GAAP) growth in the quarter was driven by continued innovation and revenue growth management initiatives within sparkling soft drinks, as evidenced by double-digit volume growth of Coca-Cola Zero Sugar across all groups. In addition to sparkling soft drinks, the company saw strong performance for brands like Fuze Tea and smartwater. Coca-Cola also announced several strategic actions, including a number of acquisitions and investments, and continued to lift, shift and scale brands around the world. The company’s disciplined growth strategies and an ongoing focus on productivity led to double-digit profit growth for the quarter.
“We continue to be encouraged by our performance year-to-date as we accelerate our evolution as an even more consumer-centric, total beverage company,” said James Quincey, President and CEO of The Coca-Cola Company. “The recent leadership appointments are intended to help accelerate the transformation of our company.”
Highlights
Quarterly Performance
- Revenues: Net revenues declined 9 % to $8.2 billion, impacted by a 13-point headwind from the refranchising of company-owned bottling operations. Organic revenues (non-GAAP) grew 6 %, driven by concentrate sales growth of 4 %, which benefited from the timing of shipments, and price/mix growth of 2 %.
- Volume: Unit case volume grew 2 %, led by Trademark Coca-Cola.
- Margin: Operating margin, which included items impacting comparability, expanded approximately 600 basis points. Comparable operating margin (non-GAAP) improved 575 basis points, driven by divestitures of lower-margin bottling operations and the company’s ongoing productivity efforts. These drivers were partially offset by an approximate 130 basis point headwind from the adoption of the new revenue recognition accounting standard and the impact of currency.
- Market share: The company continued to gain value share in total nonalcoholic ready-to-drink (NARTD) beverages.
- Cash flow: Year-to-date cash from operations was $5.5 billion, down 7 %. The decline was largely due to the impact of refranchising North American bottling territories and increased tax payments, partially offset by solid cash generation in the underlying business. Year-to-date free cash flow (non-GAAP) was $4.6 billion, down 2 %.
- Share repurchases: Year-to-date purchases of stock for treasury were $1.6 billion. Year-to-date net share repurchases (non-GAAP) totaled $707 million.
Download the full earnings release (PDF)
100 % of Coca-Cola Amatil packaging to be recyclable by 2025, including bottles, cans, plastic wrap, glass and cardboard
Australian beverages manufacturer Coca-Cola Amatil announced a commitment for 100 per cent of its Australian packaging to be recyclable by 2025, including all bottles, cans, plastic wrap, glass and cardboard. The company will also work towards phasing out unnecessary single-use packaging through improved design, innovation or the use of recycled alternatives.
Group Managing Director Alison Watkins said the commitments were part of the National Packaging Targets announced by Federal Environment Minister, the Hon Melissa Price MP.
“As a beverages manufacturer, we’re serious about playing our part in addressing recycling,” Ms Watkins said.
“We’ve heard the community message loud and clear – that unnecessary packaging is unacceptable and we all need to work together to reduce the amount entering litter streams, the environment and the oceans.
“The National Packaging Targets aim to make a substantive improvement in packaging waste reduction, which is why we’re proud to be a founding supporter and to champion their implementation by industry.”
Australia’s 2025 National Packaging Targets are:
- 100 % of all Australia’s packaging will be reusable, recyclable or compostable by 2025 or earlier
- 70 % of Australia’s plastic packaging will be recycled or composted by 2025
- 30 % average recycled content will be included across all packaging by 2025
- Problematic and unnecessary single-use plastic packaging will be phased out through design, innovation or introduction of alternatives
Earlier this year the Mount Franklin 600 ml bottle was launched using 100 % recycled content, with trials under way on reaching an average 50 per cent recycled content across the Australian portfolio by 2020.
Ms Watkins said the Targets were in addition to existing commitments on plastics and packaging reduction, including the aspiration of “World Without Waste” – a Coca-Cola Company goal to collect and recycle one bottle or can for every one produced, worldwide, by 2030.
Amatil and brand partner and shareholder The Coca-Cola Company is also developing sustainable packaging goals to increase the recycled content in plastic bottles and support recycling collection in Australia. Recognising the threat of marine plastic litter, The Coca-Cola Company this week joined governments and industry leaders to sign onto the Ocean Plastics Charter. Originally adopted at the 2018 G7 Summit, the Ocean Plastics Charter calls on governments, industry and the public to rethink their relationship with plastics.
The Coca-Cola Company announced that it has reached a definitive agreement to acquire Costa Limited, which was founded in London in 1971 and has grown to become a major coffee brand across the world.
The acquisition of Costa from parent company Whitbread PLC is valued at $5.1 billion and will give Coca-Cola a strong coffee platform across parts of Europe, Asia Pacific, the Middle East and Africa, with the opportunity for additional expansion. Costa operations include a leading brand, nearly 4,000 retail outlets with highly trained baristas, a coffee vending operation, for-home coffee formats and Costa’s state-of-the-art roastery.
For Coca-Cola, the expected acquisition adds a scalable coffee platform with critical know-how and expertise in a fast-growing, on-trend category. Costa ranks as the leading coffee company in the United Kingdom and has a growing footprint in China, among other markets. Costa has a solid presence with Costa Express, which offers barista-quality coffee in a variety of on-the-go locations, including gas stations, movie theaters and travel hubs. Costa, in various formats, has the potential for further expansion with customers across the Coca-Cola system.
The acquisition will expand the existing Coca-Cola coffee lineup by adding another leading brand and platform. The portfolio already includes the market-leading Georgia brand in Japan, plus coffee products in many other countries.
Costa also provides Coca-Cola with strong expertise across the coffee supply chain, including sourcing, vending and distribution. This will be a complement to existing capabilities within the Coca-Cola system.
Coffee is a significant and growing segment of the global beverage business. Worldwide, coffee remains a largely fragmented market, and no single company operates across all formats on a global basis.
Combines the ‘Power of 3’ in a tasty snack for small hunger pangs
Taking another step towards its commitment to provide an array of healthy and nutritious beverage choices to consumers, Coca-Cola India expanded its portfolio of Minute Maid by launching Minute Maid Smoothie, a delicious snack that combines the ‘Power of 3’ ingredients – Fruits, Milk and Nutrients. The launch is a continuation of Coca-Cola India’s efforts to expand its portfolio including, ‘Health and Wellness’. This is a significant addition in Minute Maid fraternity and underlines company’s commitment towards the Fruit Circular Economy initiative.
Made from locally sourced fruits, the product has been designed to suit the Indian palate and cater to the increasing needs of mothers looking for a combination of nutritious goodness and taste. Minute Maid Smoothie is available in Mango & Banana variants, priced at INR 30 for 250 ml.
In the first phase of the launch, the product will be available in Tamil Nadu, Karnataka, Telangana and Andhra Pradesh, followed by other states. In the coming months, Coca-Cola India will also expand the Smoothie range by introducing other popular flavours.
Following Tuesday’s (21 August 2018) launch by Coca-Cola of a £5m campaign to promote a new unified packaging redesign for its original and Zero Sugar variants,
Jonathan Davison, Beverage Analyst at GlobalData, a leading data and analytics company, offers his view on this latest development:
“Coca-Cola’s Zero Sugar variant has achieved substantial gains across the UK in recent years, most notably a 29 % increase in 2017, so this move to unify its packaging design with the main brand will only strengthen the brand’s sales still further.
“A core brand packaging revamp like this will have been long in the planning, but the timing of Coca-Cola’s announcement provides the most compelling evidence yet that it is keeping a close watch on the progress of closest challenger PepsiCo.
“The unveiling of the new-look designs could well have been brought forward to counter the news of PepsiCo’s SodaStream acquisition, barely 24 hours after the latter featured heavily in mainstream global media. This, in turn, came days after Coca-Cola revealed plans to invest in sports drinks brand BodyArmor.
‘‘With virtually each passing day this decades-old rivalry between the two beverage giants intensifies further, and it is showing no signs of letting up any time soon.’’
Coca-Cola European Partners plc (CCEP) announced its interim results for the six months ended 29 June 2018 and maintains full-year 2018 outlook.
Highlights
- First-half diluted earnings per share were € 0.85 on a reported basis or € 1.00 on a comparable basis, including a negligible impact from currency translation.
- First-half reported revenue totalled € 5.4 billion, flat versus prior year, or up 1.0 percent on a comparable and fxneutral basis. Volume decreased 3.5 percent on a comparable basis, partly reflecting the impact of recent strategic portfolio and pricing decisions.
- First-half reported operating profit was € 605 million; comparable operating profit was € 699 million, up 4.5 percent on a comparable basis, or up 5.0 percent on a comparable and fx-neutral basis.
- Second-quarter diluted earnings per share were € 0.60 on a reported basis or € 0.67 on a comparable basis, including a negligible impact from currency translation.
- CCEP affirms full-year guidance for 2018 for comparable and fx-neutral diluted earnings per share growth of between 6 percent and 7 percent when compared to 2017 comparable results.
- CCEP raises full-year guidance for 2018 free cash flow to a range of € 900 million to € 950 million.
- CCEP declares quarterly dividend of € 0.26 per share.
“We are pleased with our execution and performance in the first half as we continued to make bold portfolio and pricing decisions. We are confident that these are the right strategic initiatives for our business in the long-term, while acknowledging the near-term negative impact on volume,” said Damian Gammell, Chief Executive Officer.
“This strategy is reflected in another quarter of solid growth, including strong revenue per unit case gains as we focus on improving our pack and pricing architecture. Overall, we are encouraged by our first-half performance given business disruption in France owing to customer negotiations; unfavourable weather in Iberia; and new industry taxes, notably in Great Britain.
“Given our solid progress in the first half, we have affirmed our 2018 profit outlook. We are committed to implementing our Beverages For Life strategy; investing in our business; better serving our customers; and improving our in-market execution,”
Mr. Gammell said. “Importantly, we are confident that we have the right strategy and the right team in place to deliver strong cash generation and ultimately generate long-term value for our shareholders.”
Please download the full report under: https://bit.ly/2MheRqO
It’s no secret Coca-Cola loves to experiment with exciting new flavors to create something delicious, so in true Coke style we are welcoming winter with a citrusy twist. Say hello to Coca-Cola Australia’s newest limited-edition flavour Coca-Cola Orange No Sugar.
“We’ve seen how much Australians have enjoyed our other limited edition flavours. Introducing a hint of orange flavour was perfect for Australia’s cooler months. We think Coke fans are going to love it,” said Lucie Austin, Coca-Cola Australia marketing director.
“This limited edition flavour has been crafted for Australians and the spirited way we do the winter season – fun and sociable. We’re not afraid to get the woolies on, grab our friends or family and get out and about when it’s chilly. So we’ve created a refreshing and unique drink to match,” Lucie said.
Aside from being refreshing and providing a great citrus alternative to a lemon or lime in your Coke, Coca-Cola Orange is completely sugar free, following the Company’s pledge to reduce sugar in their beverages.
“As we work to innovate with delicious combinations to match the diverse tastes of our customers, Australians will see more exclusive and limited edition flavours in the coming years,” she said.
Don’t waste any time in getting your hands on Coca-Cola Orange No Sugar, as it’s only making a guest appearance for our winter months.
“Coca-Cola Orange No Sugar is here for a good time, not a long time, so get in quick,” Lucie said.
Coke Orange No Sugar is available nationally as a limited-edition flavour from July 23, 2018.
The Coca-Cola Company announced that it is fundamentally reshaping its approach to packaging, with a global goal to help collect and recycle the equivalent of 100 % of its packaging by 2030.
This goal is the centerpiece of the Company’s new packaging vision for a World Without Waste, which the Coca-Cola system intends to back with a multi-year investment that includes ongoing work to make packaging 100 % recyclable. This begins with the understanding that food and beverage containers are an important part of people’s modern lives but that there is much more to be done to reduce packaging waste globally.
“The world has a packaging problem – and, like all companies, we have a responsibility to help solve it,” said James Quincey, President and CEO of The Coca-Cola Company. “Through our World Without Waste vision, we are investing in our planet and our packaging to help make this problem a thing of the past.”
The Company and its bottling partners are pursuing several key goals:
- Investing in the planet: By 2030, for every bottle or can the Coca-Cola system sells globally, we aim to help take one back so it has more than one life. The Company is investing its marketing dollars and skills behind this 100 % collection goal to help people understand what, how and where to recycle. We will support collection of packaging across the industry, including bottles and cans from other companies. The Coca-Cola system will work with local communities, industry partners, our customers, and consumers to help address issues like packaging litter and marine debris.
- Investing in packaging: To achieve its collection goal, The Coca-Cola Company is continuing to work toward making all of its packaging 100 % recyclable globally. The Company is building better bottles, whether through more recycled content, by developing plant-based resins, or by reducing the amount of plastic in each container. By 2030, the Coca-Cola system also aims to make bottles with an average of 50 % recycled content. The goal is to set a new global standard for beverage packaging. Currently, the majority of the Company’s packaging is recyclable.
World Without Waste is the next step in the Company’s ongoing sustainability efforts, building off success in replenishing an estimated 100 % of the water it uses in its final beverages. The Company achieved and exceeded its water replenishment goal in 2015, five years ahead of expectations. These efforts are part of the Company’s larger strategy to grow with conscience, by becoming a total beverage company that grows the right way.
“Bottles and cans shouldn’t harm our planet, and a litter-free world is possible,” Quincey said. “Companies like ours must be leaders. Consumers around the world care about our planet, and they want and expect companies to take action. That’s exactly what we’re going to do, and we invite others to join us on this critical journey.”
After 35 years, America’s No. 1-selling zero-calorie beverage brand is entering a new era.
With an updated look, sleek new packaging, the debut of four bold, new flavors and a new campaign, The Coca-Cola Company is re-energizing and modernizing Diet Coke for a new generation of drinkers – and offering its millions of current fans a new look and more flavors.
The two-year innovation process was fueled by consumer research pointing to younger Americans’ affinity for big, yet refreshing and great-tasting, flavors in their favorite foods and beverages – from hoppy craft beers to spicy sauces.
The company spoke to more than 10,000 people from across the country to get their ideas and inputs on potential flavor extensions, packaging updates and more. From these insights, Coca-Cola’s R&D team developed and tested more than 30 Diet Coke flavor combinations, featuring tropical, citrus and even botanical notes. Ultimately, Diet Coke landed on four flavors that received the most positive consumer responses.
Ginger Lime, Feisty Cherry, Zesty Blood Orange and Twisted Mango bring more variety to the trademark by complementing the unique, crisp taste of Diet Coke with unexpected-yet-delicious tastes. They aim to satisfy adventurous fans’ thirst for bolder tastes and more dynamic and uplifting experiences.
Diet Coke and the new flavors will be packaged in sleek 12-oz. cans and sold as on-the-go singles and in eight-packs. Diet Coke also will continue to be offered in all existing package sizes, such as standard 12-oz. cans, mini cans, glass bottles and more. All new packaging and flavors hit store shelves this month.
New Packaging, New Look
The sleek cans will give Diet Coke a more contemporary feel. A refreshed visual identity, meanwhile, lives up to Diet Coke’s new flavors and packaging.
Anchored by the brand’s iconic silver color, the new look-and-feel has a simplified color palette focused on silver and red with accents of bold color to represent the new flavors. A slightly refined typography simultaneously preserves Diet Coke’s heritage, yet presents it in a more progressive manner.
A Personality Evolution and a Brand Rejuvenation
Together, the new packaging designs and visual identity represent a personality evolution – a brand rejuvenation – for Diet Coke. A robust integrated marketing campaign launching later this month will celebrate the delicious, uplifting taste of Diet Coke and express an unapologetic, emboldened point of view for the brand.
Coca-Cola Great Britain has created its first ever ad made entirely out of its 100 % recyclable packaging. Love Story, created by Ogilvy and Mather Berlin, tells the story of two bottles who fall in love as they meet over and over again after being disposed of properly and recycled into new bottles. The ad aims to encourage more people to recycle and highlights how plastic bottles can be reused to produce more plastic bottles.
The ad has recycling at its heart as the entire set was made entirely out of recyclable material – mainly Coca-Cola packaging. It was created Berlin-based duo Cris Wiegandt & Lacy Barry (Cosmopola) who used more than 1,500 Coca-Cola, Fanta, Sprite, Smartwater and Honest bottles and cans during production.
The ad premieres was on Channel 4 on 28 July and will continue on cinema, digital and social media throughout the summer. The campaign will communicate its message about recycling to 35 million Britons by the end of this year.
The new ad is part of Coca-Cola Great Britain’s new sustainable packaging strategy, which sees the company aim to recover all its packaging, as well as setting the ambition to increase recycled PET in bottles from 25 per cent to 50 per cent by 2020. It’s the company’s biggest ever, recycling-focused consumer communications campaign and will include experiential activities at music festivals and events, at which Coca-Cola will promote recycling messaging to another six million people.
