Coca-Cola HBC, the parent company of The Coca-Cola Company in Nigeria said its business in Africa’s largest economy witnessed decline for the full year 2018.
The soft drink maker made this disclosure in its 2018 full year result released penultimate week, but stated that its Group volume increased by 4.2 per cent in emerging markets, the volume also increased by 4.3 per cent with growth in all countries except Nigeria.
The company said in its full-year financial report that emerging segment price/mix growth, up by 2.4%, was a moderation from prior years due to the cycling of 2016/17 price increases in Nigeria and lower Premium Spirits sales in Russia. However, overall volume growth accelerated to 4.2%, with growth in all segments, driven by Sparkling beverages.
Zoran Bogdanovic, Chief Executive Officer of Coca-Cola HBC AG, said
“In 2018 we delivered another very good performance with revenue growth above our target range and another step up in margins. Strong volume growth in all our segments was helped by a record number of new product launches, whilst price/mix improved for the eighth consecutive year. This growth supported margin progress, which we delivered while increasing our investment in marketing.
“Our sharp focus on cost efficiencies continues while we invest in the business for growth. The shape of the business, capabilities and commitment of our people and our overall commercial proposition give us confidence in our ability to continue to grow revenues and margins.”
It is however shocking, seeing as in 2018, the company ventured into the manufacturing of alcoholic beverages and energy drink to boost their revenue, their report of the third quarter of last year showed that the consumption rate of coca-cola products in Nigeria increased, so the reduction from that time to the fourth quarter is puzzling.
Reasons for the decline
Operating via its wholly-owned subsidiary, Nigerian Bottling Company, NBC, with brands such Coke, Fanta and Sprite, the company said Nigerian volumes declined for the year as a result of competitive pressures.
According to the results, it recorded lower volume in Nigeria due to intense competition in Sparkling segment which comprises the trademark Coca-Cola and the Coca-Cola Zero variants, Water, while juice and Energy delivered positive results.