CCEP

Business Context and Reporting Period

Company: Coca-Cola Europacific Partners Plc (CCEP)
Filing Type: Form 6-K (Trading Update)
Reporting Period: First Quarter ended 28 March 2025
Key Event: Q1 performance update and declaration of an interim dividend. The company reaffirmed its full-year 2025 guidance, citing resilient market positions across 31 markets despite a volatile global macroeconomic environment.

Key Financial Metrics

*Underlying volume excludes the impact of strategic de-listings (e.g., Capri Sun).

Geographic Performance (Adjusted Comparable Revenue)

• Europe: €3,253 million (-1.6% FX-neutral). Volume declined -2.1% due to Easter timing and Capri Sun de-listing, offset by revenue per unit case growth of +4.1%.
• Asia Pacific (APS): €1,436 million (+1.0% FX-neutral). Volume grew +2.1% driven by the Philippines, offset by declines in Australia (cyclone impact) and Indonesia. Revenue per unit case grew +2.1%.

Material Changes vs. Prior Period

• Volume Dynamics: Reported volume increased 7.8% primarily due to the acquisition of Coca-Cola Beverages Philippines, Inc. (CCBPI). On an adjusted comparable basis (normalizing for the acquisition and two fewer selling days in Q1 2025), volume declined 0.6%.
• Pricing Power: Revenue per unit case grew 3.1% on an adjusted comparable basis, driven by headline price increases in France, Iberia, Great Britain, Germany, and Australia, alongside promotional optimization.
• Portfolio Shifts: Strategic de-listing of Capri Sun in Europe impacted volume. Conversely, the Energy category (led by Monster) grew 11.9%, and Coca-Cola Zero Sugar grew 4.0%.
• Index Inclusion: CCEP entered the FTSE UK Index Series in March 2025 following a listing category transfer.

Guidance, Outlook, and Management Commentary

CEO Commentary: Damian Gammell stated Q1 performance was "broadly as expected," with volume phasing due to Easter timing resulting in a stronger April. Management highlighted share gains ahead of the market and solid revenue per unit case growth.

Reaffirmed FY25 Guidance (Adjusted Comparable & FX-Neutral)

• Revenue Growth: Approximately 4% (balanced between volume and revenue per unit case).
• Cost of Sales per UC: Comparable growth of approximately 2% (commodity inflation expected to be broadly flat; ~90% hedged).
• Operating Profit: Growth of approximately 7%.
• Comparable Effective Tax Rate: Approximately 26%.
• CAPEX: Approximately 5% of revenue (including leases).
• Comparable Free Cash Flow: At least €1.7 billion.
• Dividend Payout Ratio: Approximately 50% of comparable EPS.
• Share Buyback: €1 billion over 12 months commencing February 2025.

Risks and Contingencies

• Macroeconomic Volatility: Global economic conditions and geopolitical situations (e.g., Middle East) impacting markets like Indonesia.
• Weather Events: Adverse weather (e.g., cyclones in Australia, cold snaps in Iberia) affecting short-term trading.
• Regulatory & Tax: Sugar taxes (France) and potential tariff adjustments.
• Supply Chain: Raw material costs and availability.

Investor Verification Checklist

• Adjusted Comparable Basis: Verify the reconciliation between reported and adjusted comparable figures, specifically the pro-forma inclusion of the Philippines acquisition (CCBPI) and the adjustment for two fewer selling days in Q1 2025.
• Volume vs. Price Mix: Confirm the sustainability of the 3.1% revenue per unit case growth given the -0.6% adjusted volume decline.
• Capri Sun De-listing: Assess the long-term impact of the strategic de-listing of Capri Sun on Europe volume, which is expected to be fully annualized from Q2 2025.
• Dividend Sustainability: Review the cash flow generation required to support the ~50% payout ratio and the €1 billion share buyback program.
• FX Exposure: Monitor the impact of foreign exchange rates, as the guidance is provided on an FX-neutral basis while reported results include FX impacts.