Drinks giant Coca-Cola unveiled a range of savings measures including recruitment freezes and reduced marketing expenditure, and said it would also 'temporarily' withdraw its dividend payout ratio guidance DarrenGrayRural
Drinks giant Coca-Cola Amatil has unveiled plans for $140 million of savings this year, and will reduce capital expenditure by $100 million in response to the economic shock from the coronavirus pandemic.
Coca-Cola unveiled the plans shortly before the Australian market opened on Friday, saying it would also "temporarily" withdraw its dividend payout ratio guidance. Coca-Cola Amatil boss Alison Watkins says the company's first quarter of 2020 has been marred by the Australian bushfires and the coronavirus pandemic.The $140 million plus of savings will come from a range of measures including recruitment freezes, reduced marketing expenditure, reduced discretionary spending and a significant reduction in incentives.
"Non-critical projects have been deferred reducing Capital Expenditure for FY2020 from $300 million to $200 million," the company said.The company revealed that its March quarter EBIT had recorded a "mid teen percentage decline" on the March quarter of 2019. But overall sales volumes recorded low single digit percentage growth.
Narrowing in on the period when sales were most heavily affected by COVID-19, the month of March, Coca-Cola said sales volumes were up by a mid-single digit percentage rise on the prior corresponding period as consumers engaged in stockpiling.
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