Coca-Cola Europacific Partners (CCEP) Q2 FY25 earnings call: guidance and Q&A

Why does the guide imply top-line acceleration in H2 but essentially stable bottom-line growth, and what is the price/mix vs volume mix expected in H2?

Damian confirmed acceleration into H2 on returning volume growth and strong price/mix; Ed said H2 growth skews more to volume and less to revenue per case, geographic mix is less of a benefit, and OpEx phasing between halves keeps profit delivery at a similar ~7%.

“For H2, although the volume is greater, we see more of that coming from volume itself and a bit less from revenue per case. And as Damian mentioned, the geographical mix will not be as much of a benefit in the second half.”

asked by Bonnie Herzog · answered by Ed Walker

Does Indonesia's weakness change the mid-term growth algo, and are you assuming Indonesia accelerates or that other levers offset it?

Ed said the 4% top-line is not dependent on a significant Indonesia turnaround; high-single-digit remains the right longer-term Indonesia plan, but it is a relatively small part of the business. Damian noted slight improvement into July/August.

“we're not assuming that there's a significant turnaround in the medium term that drives our 4% on the top line.”

asked by Nadine Sarwat · answered by Ed Walker

Where are you on hedging for 2025 and into 2026, and what are the major COGS moving parts for next year?

Ed said commodities have been broadly flat for 2025 and are expected to roll into 2026; CCEP is over 90% hedged for 2025 and ~60% for 2026, having secured some favorable forward prices amid volatility, leaving room to capture further favorable moves.

“in all the main commodity types, we're over 90% hedged. We're around 60% at this stage for 2026, which is roughly where we would like to be at this stage of the year.”

asked by Matt Ford · answered by Ed Walker

Where are you in the Australia margin turnaround since the Amatil deal, and can margins return to the previous high-teens/low-20s level?

No market-specific margin target given, but Ed disclosed Australia revenue grew at an 8% CAGR from 2021 to 2024 with better-than-that bottom-line growth and operating margin accretion, driven by capacity investment, R&MGM/promo capabilities, portfolio rationalization, and shared services (Bulgaria/Manila). Beam Suntory exit is the last big structural realignment.

“our revenue from '21 has grown at a CAGR, if you look until the end of '24 by 8% per year, so a fantastic revenue performance. And we've done better than that on the bottom line.”

asked by Charlie Higgs · answered by Ed Walker

How do you feel about the 4%+ ambition beyond FY25, and is FY26 likely at or above 4%?

Damian said there is no change in conviction on the 4% top-line objective; 2025 drags (Spain tea transition, Beam Suntory exit, Indonesia) are largely 2025 events, so 2026 and beyond should stick with 4% revenue guidance, with ambition to go higher over time.

“a 4% guidance is a pretty good number, particularly with a 7% bottom line and that free cash flow.”

asked by Mitch Collett · answered by Damian Gammell

What are you seeing regionally in Q3 (Europe weather, Away-from-Home) and how large is the Philippines flooding impact on H2?

Damian said Philippines flooding and tougher weather comps are reflected in guidance; Indonesia has stabilized in July/August; Australia/NZ/Pacific were very strong. In Europe, good weather from late June boosted July, broad across markets with GB a standout.

“I'm also pleased that we've seen a stabilization in Indonesia particularly in July and through August.”

asked by Simon Hales · answered by Damian Gammell

Putting weather aside, does the year-to-date performance give confidence in the ability to grow European volumes over the medium term?

Damian affirmed confidence in mid-term European volume growth and Away-from-Home growth, supported by campaigns (Star Wars, EPL, Diet Coke 'This Is My Taste'), Fanta/Sprite innovation, Coke Classic innovation (0.5L can), and ARTD (more revenue than volume), while price/mix has overdelivered.

“all of that together gives us confidence in midterm volume growth. That starts in Q2. It's got to continue in Q3 and into Q4.”

asked by Edward Mundy · answered by Damian Gammell

Is there anything beneath the pointed commentary on competitiveness and the multiyear view — any market/category flare-ups different from recent months?

Damian said intensity is not materially different from prior years; some markets saw a bit less promo intensity where commercial agreements were not yet landed, and there was aggressive promo pricing from competitors, particularly in GB, which CCEP manages through its profitable Away-from-Home lens.

“We have seen some aggressive promo pricing from some of our competitors, particularly in GB.”

asked by Lauren Lieberman · answered by Damian Gammell

Is the year-on-year decline in comparable FCF working-capital related, and is there risk to the FY guidance if Indonesia stays weak?

Ed said H1 comparable FCF is slightly below last year purely on working-capital phasing (the half ended earlier, ~27 June), with H2 seasonally much stronger given the European summer; Indonesia is small and not a heavy cash drain, so the at-least EUR 1.7B guidance is reaffirmed.

“it's purely a phasing item. If you look at previous years, we always do more free cash flow in the second half of the year than the first half of the year given the big summer selling period in Europe.”

asked by Usama Tariq · answered by Ed Walker