Coca-Cola Amatil, the maker of Coke in Australia, today released its half year results showing a 7.8% increase in profit to $198.2 million
But earnings from Australia, representing about two-thirds of the business, fell almost 2% to $218 million. Coca-Cola Amatil also operates in New Zealand, Fiji, Indonesia, Papua New Guinea and Samoa.
The reason is evolving tastes. In Australia, there’s less demand for fizz — carbonated drinks — and more for still, including water, energy shots and dairy.
Volumes in still beverages increased by 9.3% over the six months.
Coca-Cola Amatil says this was the result of investment which started in 2015, including the introduction of FUZE Tea and Monster Energy and a new Mount Franklin water marketing campaign.
Managing director Alison Watkins says the improved performance in these areas helped to offset the decline in Australian sparkling beverages.
In early trade, Coca-Cola Amatil shares were down 2.8% to $9.32.
This chart shows the change in mix from fizzy to still:
“Consumer tastes and trends in Australia are continuing to evolve and our focus over the last two years has been on rebalancing our full portfolio,” Watkins says.
“We are moving to meet consumer demands with a greater focus on portion size and product reformulations in sparkling and increased investment in stills.”
Total revenue for the six months was up 3% to $2.57 billion.
The company declared an interim dividend of 21 cents, franked to 75%, an increase of 5%.