Q2 2025 Coca-Cola European Partners PLC Earnings Call

Operator: Hello, and thank you for standing by, and welcome to today's COCA-COLA EUROPACIFIC PARTNERS half-year 2025 results conference call. At this time, all participants are in a listen-only mode. After the speaker's remarks, there will be a question and answer session. To ask a question during the session, you will need to press star one and one on your telephone. I must advise you that this conference call is being recorded today. I would now like to hand the conference over to Vice President of Investor Relations and Corporate Strategy, Sarah Willett. Please go ahead, Sarah.

Hello, and thank you for standing by and welcome to today's Coca-Cola. Europacific Partners half-year 2025 results conference call.

At this time, all participants are in a listen-only mode.

With it, please go ahead. Sarah.

Sarah Willett: Thank you all for joining us today. I am here with Damian Gammell, our CEO, and our CFO, Ed Walker. Before I hand over to Damian, a reminder of our cautionary statements. This call contains forward-looking management comments and other statements reflecting our outlook. These comments should be considered in conjunction with the cautionary language contained in today's release, as well as the detailed cautionary statements found in reports filed with the U.K., U.S., Dutch, and Spanish authorities. A copy of this information is available on our website at www.cocacolaep.com. Prepared remarks will be made by Damian. We will then turn the call over to your questions. As I have stated, metrics presented today will be on a comparable and effects-neutral basis throughout.

Thank you all for joining us today. I'm here with Damian gaml, our CEO and our CFO at Walker. So I hand over to Damian. A reminder of our cautionary statements, this call will contain forward-looking management comments and other statements reflecting our Outlook.

These comments should be considered in conjunction with the cautionary language contained in today's release, as well as the detailed cautionary statements found in reports further. The UK, US, Dutch, and Spanish authorities...

This information is available on our website at www.cok.com.

Prepared remarks as made by Damian. We will then turn the call over to your questions.

Sarah Willett: This will also be presented on an adjusted comparable basis, thus reflecting the results of CCP and our Australia Pacific and Southeast Asia business unit, APS, as if the Coca-Cola Philippines transaction had occurred at the beginning of last year rather than in February when the acquisition completed. Following the call, a full transcript will be made available as soon as possible on our website. I will now turn the call over to our CEO, Damian.

Um, unless otherwise stated, metrics presented today will be on a comparable neutral basis throughout. This will also be presented on a Majestic comparable basis, reflecting the results of CCP and our Australia Pacific and Southeast Asia business unit (APS) as if the Coca-Cola Philippines transaction had occurred at the beginning of last year.

rather than in February, when the acquisition completed,

Damian Gammell: Thank you, Sarah, and many thanks to everyone for joining us today. I'm really pleased that we continue to execute on our growth strategy. I'd like to start today by thanking all of my great colleagues for their energy, hard work, and continued dedication to our customers and to our business. As always, this is supported by our strong aligned relationships with The Coca-Cola Company, Monster, and our other brand partners. In short, our value creation is clearly evidenced by our impressive TSR of around 235% since 2016. We continue to deliver solid top and bottom line growth. Our cash returns are accelerating, having now completed around €460 million of share buybacks this year, alongside paying a dividend in line with an annualized payout policy of around 50%, both within our disciplined capital allocation framework.

Following the call aboard, the transcript will be made available as soon as possible on our website. I will now turn the call over to our CEO, Damian Gammell.

Thank you, Sarah, and many thanks to everyone for joining us today.

I'm really pleased that we continue to execute on our growth strategy. And I'd like to start today by thanking all of my great colleagues for their energy, hard work, and continued dedication to our customers, and, to our business.

As always, this is supported by our strong, aligned relationships with the Coca-Cola Company, Monster, and other brand partners.

In short, our value creation is clearly evidenced by our impressive TSR of around 235% since 2016.

We can continue to deliver solid top- and bottom-line growth.

Our cash returns are accelerating, having now completed around €460 million of share buybacks this year, alongside paying a dividend in line with our annualized pay policy of around 50%.

Damian Gammell: Beyond today's results, we will also circle back to a few of the areas we covered in detail at our recent investor event in Manila to provide an update on the progress made since then, with a little bit more detail on what is coming around the corner. At that investor event, we talked in detail about our resilient categories. So, a brief reminder of one of the key slides we shared. Simply put, we are in the right categories, including ARTD and hot coffee, that are structurally growing, are profitable, and diverse. We've got relevant share in our core NARTD category, which grew by more than 5% in the last 12 months. We have a matchable scale and localness in our supply chain and in our frontline sales force, and we're investing more than ever before in our key capabilities while accelerating productivity through technology and digital.

Both within our disciplined capital allocation framework.

Beyond today's results, we will also circle back to a few of the areas we covered in detail at a recent investor event in Manila, to provide an update on progress made since then.

With a little bit more detail on what is coming around the corner,

At that investor event. We talked in detail about our resilient categories. So, a brief reminder of 1 of the key slides we shared

Simply put, we are in the right categories, including artd and hot coffee that are structurally, growing are profitable and diverse.

We've got relevant share in our core NA RTD category, which grew by more than 5% in the last 12 months. We have a matchable scale and local supply chain, as well as a strong Frontline sales force. We're investing more than ever before in our key capabilities.

Damian Gammell: We are well positioned from both a portfolio and a geographical perspective, with a material presence now across our 31 markets. In short, the fundamentals of our business remain strong, and we operate in a resilient and innovative consumer category, which are healthy and growing. I'd now like to turn to our performance. We're pleased to have delivered a solid first half. We continue to grow share ahead of the market and create value for our customers. Given our year-to-date performance, strong commercial plans for the balance of the year, full-year 25 pricing in place, continued focus on productivity, and a good start to the second half, we are pleased to be reaffirming our full-year profit and cash guidance. We have updated by providing a range on full-year revenue growth of 3% to 4% rather than approximately 4%.

While accelerating productivity through technology and digital.

We are well positioned from both a portfolio and a geographical perspective with the material presence. Now, across our 31 markets in short, the fundamentals of our business remains strong, and we operate in a resilient and Innovative consumer categories, which are healthy and growing.

I'd now like to turn to our performance.

We're pleased to have delivered a solid first half. We continue to grow share ahead of the market and create value for our customers. Given our year-to-date performance, we have strong commercial plans for the balance of the year.

Full year, 25 pricedale.

Damian Gammell: This is driven by a slower than expected trajectory in Indonesia, which in Q2 alone impacted group volumes by around 1%. Of course, we will update as the year progresses. Our first half interim dividend and ongoing share buybacks demonstrate the strength of our business and our ability to deliver continued shareholder value. We are winning today, but we are also focused on creating tomorrow. Strong cash generation is supporting record investment in future growth with multi-year plans in place, and we are really starting to lock more value from tech and AI, where we have been investing for many years. We are confident we have the right strategy, all done sustainably to deliver on our mid-term growth objectives. I would now like to turn to some key performance highlights. Our solid top-line performance reflects underlying volume growth, best-in-class execution, and solid gains in revenue per unit case.

We have updated our full-year revenue growth guidance to a range of 3% to 4%, rather than approximately 4%. This adjustment is driven by a slower-than-expected trajectory in Indonesia, which impacted group volumes by around 1% in Q2 alone.

Of course, we will update as the year progresses.

Our first table, interim dividend, and ongoing share buybacks demonstrate the strength of our business.

And our ability to deliver continued, shareholder value.

So we are winning today, but we're also focused on creating tomorrow.

Strong cash generation is supporting record investment in future growth, with multi-year plans in place.

And we are really starting to look more value from tech and AI, where we have been investing for many years.

So, we're confident we have the right strategy, and we're committed to delivering sustainably on our mid-term growth objectives.

I'd now like to turn to some key performance highlights.

Our solid topline performance reflects underlying volume growth.

Damian Gammell: This was driven by sustainable revenue and margin growth management, including our continued focus on price and promotional strategies. In Europe, Easter timing and better weather supported return to volume growth in Q2, crucially with a better performance in our away-from-home business. Total first-half volumes were, however, impacted by a weaker consumer backdrop in Indonesia, though we continue to remain excited about the long-term opportunity and continue to focus on our transformation journey. We will touch on that a bit more later. Our other APS markets performed really well, including the Philippines, despite cycling strong comparables of nearly 20% last year. We grew our overall value share by 10 basis points year to date in a category which grew in volume and value, both in Europe and APS. The market remains as competitive as ever.

Management, including our continued focus on price and promotional strategies.

In Europe, Easter timing and better weather supported a return to volume growth in Q2.

Crucially with a better performance in our away from home business.

Total first-half volumes were, however, impacted by a weaker consumer backdrop in Indonesia.

Though we continue to remain excited about the long-term opportunity and continue to focus on our transformation journey.

We will touch on that a bit more later. Our other APS markets perform really well, including the Philippines. Despite cycling strong comparables of nearly 20% last year, we grew our overall value share by 10 basis points year-to-date in a category that grew in volume and value both in Europe and APS.

Damian Gammell: As we said before, we continue to take a multi-year view on our promotional and pricing strategies. We remain focused on driving profitable revenue growth and creating value for the category, whilst recognizing that remaining affordable and relevant is important for our consumers. Our strong top-line performance, together with the delivery of our efficiency programs, drove solid operating profit growth of 7.2%, with operating margin expansion both in Europe and in APS. We generated solid comparable free cash flow after investing in capacity, more coolers, technology, digital, and we delivered cash returns to shareholders of over €800 million. Ed will go into more detail on our financials shortly. As ever, our business performance reflects our great people, great brands, great execution, all done sustainably. A few brief highlights on our first half, starting with people. We continue to build the capabilities of our teams.

The market remains as competitive as ever, as we’ve said, before we continue to take a multi-year view on our promotional and pricing strategies.

We remain focused on driving profitable revenue growth and creating value for the category.

While recognizing that remaining affordable and relevant is important for our consumers.

Our strong topline performance, together with the delivery of our efficiency programs, drives solid operating profit growth of 7.2%, with operating margin expansion, both in Europe.

and in APS,

We generated solid comparable free cash flow after investing in capacity.

More coolers technology and digital, and we delivered cash returns to shareholders of over €800 million.

Ed will go into more detail on our financial shortly.

As ever, our business performance reflects our great people, great brands, and great execution, all done sustainably.

A few brief highlights on our first half, starting with people.

Damian Gammell: For example, our partnership with the London Business School has upskilled over 500 of our top leaders and has now been extended to another 3,500 colleagues. We continue to be recognized internally and externally. In 2025, the Top Employers Institute recognized Coca-Cola Europacific Partners across all of our major markets. We are really excited to welcome around 60 new colleagues into our new integrated shared service center in Manila, which Ed will also touch on a bit later. Onto our brands. We are extremely privileged to make, move, and sell the world's most loved brands, in which we continue to invest and drive appeal to even more consumers. Category highlights were included in today's release. The return of the global iconic Share a Coke campaign was well executed and well received by customers and consumers.

We continue to build the capabilities of our teams. For example, our partnership with the London Business School has upskilled over 500 of our top leaders and has now been extended to another 3 and a half thousand colleagues.

We continue to be recognized internally and externally in 2025. The Top Employers Institute recognized CCP across all of our major markets.

And we're really excited to welcome around 60 new colleagues into our new integrated shared service center in Manila, which Ed will also touch on a bit later.

Uh, on to Our Brands, we're extremely privileged to make move and sell the world's most loved brands, in which we continue to invest.

And drive appeal to even more consumers.

Category highlights are included in today's release.

Damian Gammell: The launch of This Is My Taste campaign for Diet Coke is gaining traction by providing a fresh look and identity. Overall, it is fantastic that in Europe, for example, Coca-Cola trademark remains the biggest FMCG brand. Monster had a phenomenal first half, with volumes up nearly 15%, fueled by great innovation. This is especially the case with Ultra and Zero variants, where volumes were up over 20%, alongside ongoing distribution gains. We grew retail value share in energy by around 140 bps during the period. In flavors, as we highlighted at our investor event, we are increasingly focusing on winning with flavor extensions and zeros across Fanta, including Raspberry and Apple, and of course, in Sprite. Excluding Indonesia, these brands are a bigger part of the mix. Fanta Zero volumes grew by around 7%, and Sprite Zero by around 13%.

The return of the global iconic share of Co campaign was, well executed and well received by customers and consumers.

And the launch of, this is my taste campaign for Diet Coke is gaining traction by providing a fresh look and identity overall, it is fantastic. That in Europe, for example, Coca-Cola, trademark Remains the biggest fmcg brand,

Monster had a phenomenal first half, with volumes of nearly 15%.

Fuel by grade innovation.

This is especially the case with ultra and zero variants, where volumes were up over 20%.

Alongside ongoing distribution gains.

We grew retail value, share and energy by around 14040 basis points during the period.

In flavors, as we highlighted at our investor event, we are increasingly focusing on winning with flavor extensions and zeros across Fanta, including raspberry and apple, and of course in Sprite.

Damian Gammell: The transition from Neste to Fuze Tea is ahead of plan. We continue to expand in the exciting ARTD category, with total volumes up around 9%, supported by new flavor variants for Absolut & Sprite, alongside the launch of Bacardi & Coke. The sports category continues to perform well, supported by the new red peach Aquarius variant in Spain, as well as larger pack sizes, including one-liter parallel alongside our cans. As you can see, we delivered innovation across the board through packaging, flavor extensions, special collaborations, and more. A bit later, I will share with you some of the brand plans in place for this year and beyond. We have said this before, but at Coca-Cola Europacific Partners, we are fanatical about delivering best-in-class execution and activation, whether that is in-store, online, or in outlet, all done locally to drive distribution and visibility every day.

Excluding Indonesia. These brands are a bigger part of the mix Fanta. Zero volumes grew by around 7% and Sprite Zero by around 13%.

The transition from Nesty to Fuse. Niber is ahead of plan, and we continue to expand in the exciting ARTD category, with total volumes up around 9%.

Supported by the new flavor variants for Absolute Sprite, alongside the launch of the Cardi and Coke.

And finally, the sports category continues to perform well, supported by the new red Peach Aquarius F in Spain, as well as larger pack sizes, including 1-liter Powerade, alongside our cans.

So as you can see, we delivered Innovation across the board through packaging flavor, extensions, special collaborations and more.

A bit later, I will share with you some of the brand plans in place for this year and Beyond.

We have said this before, but at CCP, we're fanatical about delivering best-in-class execution and activation.

Whether that's in store online.

Damian Gammell: We continue to create leading value for our category, adding nearly €450 million of value to our retail customers. Here I am anchoring back to what we shared with you at our investor event and our four more strategies. We love creating engaging displays, especially around key holiday events, with the cornerstone in half one being a Share a Coke campaign I referred to earlier. This is all driven by the largest sales force in FMCG, over 12,000 total, powered by technology. When our customers are buying more often, what we want is more volume. When you get more volume, we leverage our revenue management capability to drive more value sustainably. These examples show how we are bringing this to life. We have launched an 850 mL PET for smaller households in Germany, one of our biggest markets.

All done locally to drive distribution and visibility every day.

We continue to create leading value for our category, adding nearly €450 million of value to our retail customers.

And here, I'm anchoring back to what we shared with you at our investor event.

And there are four more strategies.

We love creating engaging displays, especially around key holiday events with the Cornerstone and Half 1, being a share Co campaign. I refer to earlier.

This is all driven by the largest sales force in FMCG, over 12,000 total.

Powered by technology and when our customers are buying more often, what we want, is more volume. And when you get more volume, we leverage our Revenue management.

Capability to drive more value sustainably.

These examples show how we're bringing this to life.

Damian Gammell: In markets like GB, Spain, and others, extra-free and extra-filled is a great way to manage affordability, given ongoing cost of living challenges. We continue to focus on premiumization, whether it be with more multi-pack mini cans in France, multi-pack mini PET in Australia, or more returnable glass. We are increasing our share of cold drink space by investing in more coolers across Coke trademark and Monster. We have new customer wins, including Kinnopolis in Spain and Costco wholesale in Australia, all helping our brands reach more households. We continue to accelerate our digital capabilities to reach more people, like working even more with The Coca-Cola Company on social media campaigns and by adding even better functionality to our B2B portal, myccp.com. Having delivered a record €2.3 billion in revenue in Europe last year, we have grown again by almost 10% in half one.

We've launched an 850 ml PET bottle for smaller households in Germany, one of our biggest markets.

In markets like GB, Spain, and others, extra free and extra fill is a great way to manage affordability, given ongoing costs of living.

Challenges.

We continue to focus on premiumization, whether it be with more multi-pack mini cans in France, multi-pack mini PET in Australia, or more returnable glass.

for increasing our share of cold drink Space by investing in more coolers across Coke trademark

And Monster.

We have new customer wins, including Kinopolis in Spain and Costco Wholesale in Australia.

All helping Our Brands reach more households.

And we continue to accelerate our digital capabilities to reach more people.

Like working even more with the Coca-Cola Company on social media campaigns and by adding even better functionality to our B2B portal, myccp.com.

Having delivered a record $2.3 billion in revenue year in Europe, last year we've grown again by almost 10% in H1.

Damian Gammell: Now on to our sustainability highlights before handing over to Ed. We continue to be recognized externally, including retaining our inclusion on CDP's A-list for climate, now for the ninth year. Ongoing progress in the area of packaging collection remains a core focus, including new recycling partnerships in our Pacific region. We continue to invest sustainably in sustainability-focused technology through our venture rounds across ingredients, manufacturing, and packaging to support our decarbonization journey. For example, we've invested in a climate tech company that converts wastewater into a source of renewable electricity. We're currently trialing this technology at one of our sites in GB. Just one example of how we're making Coca-Cola Europacific Partners a more sustainable and a better business. I'd now like to hand over to Ed Walker to talk about the financials in more detail. Ed?

And now, on to our sustainability highlights before handing over to Ed.

We continue to be recognized externally, including retaining our inclusion on CDP's Alias for Climate Now for the ninth year.

Ongoing progress in the area of packaging collection remains a core Focus.

Including new recycling partnerships in our Pacific region.

And we continue to invest in stability and sustainability-focused technology through our venture arms across ingredients, manufacturing, and packaging to support our decarbonization journey.

For example, we've invested in a climate tech company that converts wastewater into a source of renewable electricity. We're currently trading this technology at one of our sites in GB.

Just one example of how we're making CCEP a more sustainable and better business.

Ed Walker: Thanks, Damian, and thank you all for joining us today. For H1, we delivered revenue of €10.3 billion, which is up 2.5%. Comparable volumes, selling days adjusted, were marginally ahead, up 0.3%, despite the challenging backdrop in Indonesia. Excluding Indonesia, volumes were up around 1%, supported by Europe returning to volume growth in Q2. Our Q2 revenue was up 5.4% in total. We delivered strong revenue per unit case growth of 3.8%, reflecting positive headline pricing and promotional optimization, with a continued focus on consumer price relevance, all built on data and insights. We benefited from slightly earlier headline pricing in GB, and we had favorable pack mix, supported by the growth of Monster, favorable pack mix driven by the growth of smaller formats, such as mini cans, and favorable geographic mix as a result of the volume decline in Indonesia, which is at a lower revenue per case.

I'd now like to hand over to Ed to talk about the financials in more detail. Ed.

Thanks, Damen, and thank you all for joining us today.

So for H1, we delivered revenue of €10.3 billion, which is at 2.5% comparable volumes selling data adjusted. We are marginally ahead at 3% despite the challenging backdrop in Indonesia.

Excluding Indonesia, volumes are up around 1%, supported by Europe presenting strong volume growth in Q2.

Our Q2 revenue was up 5.4% in total.

We delivered strong revenue per unit case growth of 3.8%, reflecting positive headline pricing and promotional optimization with a continued focus on consumer price relevance, all built on data and insights.

Ed Walker: Cost of sales per unit case increased by 3.6%. This reflects our increased revenue per unit case, driving higher concentrate costs to the incident pricing model and the increase in soft drinks taxes. While a little higher than our guidance for the full year, this is mostly phasing related, given our exit from the Beam-Santoro relationship in Australia, which will generate a mixed benefit during H2. OpEx as a percentage of revenue was 21.8%, an improvement of 50 basis points, and I will touch more on that later in the coming slides. These elements combined to drive operating profit of €1.4 billion, up 7.2%, and an operating margin of 13.5%, an expansion of around 60 basis points, including a modest basis point improvement in our gross margin percentage.

We benefited from slightly earlier headline pricing in GB, and we had favorable pack mix supported by the growth of Monster. Favorable pack mix was driven by the growth of smaller formats such as mini cans and a favorable geographic mix as a result of the volume decline in Indonesia, which is at the lower revenue per case.

Cost of sales per unit case increased by 3.6%.

This reflects our increased revenue for unit case, driving higher concentrate costs to the incident pricing model and the increase in soft drink taxes.

While a little higher than our guidance, for the full year, this is mostly phasing related. Given our exit from the Beam Santoro relationship in Australia, which will generate a mixed benefit during H2.

Opex as a percentage of revenue was 21.8%, with improvements of 50 basis points. I will touch more on that later and in the coming slides.

A modest basis point improvement in our gross margin percentage.

Ed Walker: We delivered comparable diluted earnings per share of €2.02, up 3.1% on an FX neutral basis, lower than the 7.2% growth in operating profit driven by our previously guided increase in our effective tax rate to 26%. This impact is most significant for H1 than it will be for the full year due to the phasing of last year's tax expense. Comparable free cash flow generation continues to be a core priority for Coca-Cola Europacific Partners, and we delivered €425 million in H1. This was after investing in key projects, such as the addition of new aseptic lines in France and Australia, expanded ARTD capacity for Jack Daniel's and Coca-Cola, and of course, more coolers, which Damian referenced earlier. We remain on track to deliver comparable free cash flow of at least €1.7 billion for the year.

We delivered comparable, diluted earnings per share of €2.02, up 3.1% on an FX neutral basis. This growth was lower than the 7.2% increase in operating profit, driven by our previously guided increase in our effective tax rate to 26%.

This impact is most significant for H1; then it will be for the full year due to the phasing of last year's tax expense.

Comparable free cash flow generation continues to be a core priority for CCP, and we delivered €425 million in H1.

This was after investing in key projects, such as the addition of new aseptic lines in France and Australia.

Expanded ARTD capacity for Jack Daniel's and Coke, and, of course, more coolers, which Damian referenced earlier.

Ed Walker: On shareholder returns, our first half dividend was €0.79 per share, with around €460 million of our €1 billion share buyback now completed. On to efficiency and productivity, where, as you know, we have a proven track record of delivery. Our current program aims to deliver between €350 million and €400 million of savings by 2028 and is firmly on track, delivering slightly earlier than our original plan. We continue to optimize our network in market to strengthen our local operating model, such as the rationalization of distribution sites in Germany, the consolidation of production into fewer, bigger, more efficient plants, like at Grigny in Paris, which will end up serving nearly half of the French market. In Indonesia, we recently announced the closure of three single-line production sites.

We remain on track to deliver comparable free cash flow of at least €1.7 billion for the year.

And finally, on shareholder returns. Our first half dividend was $0.79 per share, with around €460 million of our €1 billion share buyback now completed.

Now, on to efficiency and productivity. We have a proven track record of delivery.

Our current program aims to deliver between €350 million and €400 million of savings by 2028 and is firmly on track, delivering slightly earlier than our original plan.

We continue to optimize our network in market to strengthen our local operating model, such as the rationalization of distribution sites in Germany. The consolidation of production into fewer, bigger, more efficient plants, like a greeny in Paris, will end up serving nearly half of the French market.

And in Indonesia, we recently announced the closure of three single-line production sites.

Ed Walker: In May, I spoke in detail about the development of our leading shared service capabilities, which until now have focused on Bulgaria. In July, as Damian Gammell mentioned earlier, I attended the opening of our new integrated shared service center in Manila, which will continue to ramp up as the year progresses. I know, having also visited Bulgaria only last week, that the growing capabilities of our shared services will continue to be a significant source of value creation and competitive advantage, all enabled by technology. Before I hand back to Damian, let me update you on our full year 2025 guidance, which reflects our current view of market conditions. Our profit and cash flow guidance remains unchanged.

In May, I spoke in detail about the development of our leading shared service capabilities, which until now have focused on Bulgaria. In July, as Damian mentioned earlier, I attended the opening of our new Integrated Shared Service Center in Manila, which will continue to ramp up as the year progresses. I know, having also visited Bulgaria only last week, that the growing capabilities of our shared services will continue to be a significant source of value creation and competitive advantage, all enabled by technology.

Before I hand back to Damian, let me update you on our full year, 25 guidelines market conditions.

Ed Walker: From a revenue perspective, we are pleased to have delivered a solid first-half performance driven by consistent revenue per unit case growth and supported by a return to volume growth in Europe in Q2. We have had a strong start to the second half and are encouraged to have seen European volume growth continue, more than offsetting a slowdown in Indonesia and the recent impacts of flooding in the Philippines. With five months of the year still to go, including the key European summer, we are now indicating a range on revenue for the full year of 3% to 4%, with the upper end remaining in line with our previous guidance, supported by our very strong commercial plans. We expect to see volume growth for the full year, with growth in Europe and in APS, despite the weakness in Indonesia.

Our profit and cash flow guidance remain unchanged from a revenue perspective. We're pleased to have delivered a solid first half performance, driven by consistent revenue growth for unit cases and supported by a return to volume growth in Europe in Q2.

We've had a strong start to the second half and are encouraged to have seen European volume growth continue to more than offset the slowdown in Indonesia and the recent impacts of flooding in the Philippines.

With five months of the year still to go, including the key European summer, we're now indicating a range on revenue for the full year of 3% to 4%, with the upper end remaining in line with our previous guidance, supported by our very strong commercial plans.

We expect to see volume growth for the full year, with growth in Europe and in APS, despite the weakness in Indonesia.

Ed Walker: On cost of sales per case, as I mentioned earlier, we still expect this to grow by around 2% for the year, with the second half benefiting from the exit of the Beam-Santoro relationship in Australia. While our guidance for full year operating profit remains at around 7% on an FX neutral basis, we are impacted by a higher effective tax rate at 26% versus 25% last year, growth in non-controlling interest given the positive outlook in the Philippines, and a slightly higher finance cost. Finally, on FX, although our guidance is provided on an FX neutral basis, based on current spot rates, we do anticipate a full year FX headwind of around 150 bps to revenue and almost 200 bps to operating profit. Thank you, and now back to Damian.

On the cost of sales per case.

As I mentioned earlier, we still expect this to grow by around 2% for the year, with the second half benefiting from the exit of the Beans and Tori relationship in Australia.

While our guidance for fully operating profit remains at around 7% on an FX neutral basis, we are impacted by a higher effective tax rate at 26% versus 25% last year.

Growth in non-controlling interest, given the positive outlook in the Philippines and a slightly higher finance cost.

And then finally on FX Although our guidance is provided on an fx. Neutral basis. Based on current spot rates, we do anticipate a fully FX headwind of around 150 basis points to revenue and almost 200 basis points to operating profit.

Thank you. And now back to Damian.

Damian Gammell: Thanks, Ed. Just a reminder now of our mid-term objectives, which we reaffirmed in May. This was a slide that we also talked to in May, covering our focus areas that you can expect us to keep revisiting as we look to our next phase of growth. I would like to touch on a few of these now. I have already mentioned the fantastic execution we have seen both the Share a Coke campaign and on This Is My Taste, our campaign to reinvigorate Diet Coke, which has supported an improved performance in both GB and Australia during the half.

Thanks Ed.

Just a reminder now of our midterm objectives, which we reaffirmed in May.

This was a slide that we also discussed with May, covering our focus areas that you can expect us to keep revisiting as we look to our next phase of growth. So, I'd like to touch on a few of these now.

Damian Gammell: There is much more to come across original tastes and lights, starting with the terrific Star Wars collaboration, a favorite of mine, on limited edition cans, a new Time for Coke campaign, and another favorite of mine, the exciting new tie-up with the English Premier League, which will see packs in your team's colors during the upcoming season. I also referenced earlier the phenomenal performance and energy during the half, with strong share gains and volume growth. There remains plenty of headroom for growth in this category, given lower per caps relative to the U.S., as we highlighted in May. Our step-up in cooler placements is supporting wider distribution away from home, helping to close the gap relative to Coke, and it is working, with Monster growth in away from home of 20% during half one. Early days in our exciting journey in the fast-growing alcohol ready-to-drink category.

Campaign. And this is my taste: our campaign to reinvigorate Diet Coke, which is supported and improved performance in both GB and Australia during the half.

But there's much more to come across, with regional tastes and lights starting with the terrific Star Wars collaboration. A favorite of mine is the Unlimited Edition cans.

A new time for a Coke campaign and another favorite of mine: the exciting new tie-up with the English Premier League, which will see packs in your team's colors during the upcoming week's season.

I also referenced earlier the phenomenal performance and energy during the half, with strong share gains and volume growth.

The remains plenty of headroom for growth in this category.

Given our lower per capita, relative to the U.S., as we highlighted in May, our step-up and cooler placement are supporting wider distribution away from home.

Helping to close the gap relative to the Coke, and it's working with monster growth and away-from-home of 20% during H1.

Damian Gammell: In Australia, however, we are already a solid number two, with around a 20% share in a category that is over 15% of total alcohol. Now is the time to further leverage that expertise we have built up over nearly 20 years in the market by aligning our portfolio with The Coca-Cola Company. With that in mind, and as previously discussed, the relationship with Beam-Santoro came to an end at the end of June. While this creates a near-term headwind reflecting its higher revenue per unit case, as you will see detailed on the slide, this is the right decision for the long term. We are now able to build an even stronger brand platform, starting with Bilson's and the launch of Bacardi and Coca-Cola, which comes to the Australian market in the next few months.

Early days in our exciting journey in the fast-growing alcohol ready-to-drink category.

In Australia. However, we're already a solid number 2.

With around a 20%, share in a category that's over, 15% of total alcohol.

Now is the time to further leverage that expertise. We built up over nearly 20 years in the market by aligning our portfolio with the Coca-Cola Company.

With that in mind, and as previously discussed, the relationship with being Suntory came to an end at the end of June. While this creates a near-term headwind, it is a reflective case.

As you will see, detailed on the slide, this is the right decision for the long term.

Damian Gammell: Another area of alignment has been in Spain in ready-to-drink tea, where we are transitioning away from Neste to the stronger Fuze Tea platform. Brilliant execution and marketing are delivering both distribution and performance ahead of plan, demonstrated by our number one year-to-date category value share with Fuze Tea. We have also recently reformulated and relaunched our ready-to-drink tea in Indonesia, Fresh Tea. This will be rolling out in a variety of new flavors, including passion fruit and apple with lemongrass, and with a new look over the coming months. Touching now on Indonesia, as highlighted at our investor event, the macroeconomic slowdown is impacting household consumption, which has affected local, regional, and international brands alike. As Ed Walker said earlier, excluding Indonesia, volumes were up around 1% in the first half.

We are now able to build an even stronger. Brand platform starting with bilton's and the launch of the cardi and Coca-Cola, which comes to the Australian Market in the next few months.

Another area of alignment has been in Spain in ready-to-drink tea.

We are transitioning away from this tea to the stronger Fuse T platform.

Brilliant execution and marketing are delivering both distribution and performance ahead of plan.

Demonstrated by our number one year to today, category value share with Fuse T.

We've also recently reformulated and relaunched our ready-to-drink tea in Indonesia.

Press t.

This will be rolling out in a variety of new flavors, including passion fruit and apple with lemongrass.

I'm with a new look over the coming months.

Damian Gammell: Putting aside the near-term headwinds, we remain excited about the long term and significant opportunity in a market of close to 300 million people, half of whom are under 30, very few of whom drink alcohol. We are pushing on at pace, particularly with the transformation of our network and route to market, Ed Walker mentioned earlier, and the closure of three single-line plans to make us even more efficient. We have also taken a further step toward completing our move away from direct delivery to a partner distributor model, with Bali now underway and Java set to complete during half two. This will give us the ability to effectively grow distribution and availability as we continue to develop the sparkling category and the reach of our brands, supported by The Coca-Cola Company, to what we see as a very exciting consumer landscape of the future.

Touching now on Indonesia, as highlighted at our investor event. The macroeconomic slowdown is impacting household consumption, which has affected local, regional, and international brands. Alike, as Ed said earlier, excluding Indonesia, volumes were up around 1% in the first half.

Putting aside the near-term headwinds, we remain excited about the long-term and significant opportunity in a market close to 300 million people.

Half of whom are under 30.

Very few of whom drink alcohol. So we are pushing on at PACE, particularly with the transformation of our network and route to market, as Ed mentioned earlier.

And the closure of three single-line plans to make us even more efficient.

We've also taken further steps toward completing our move away from the Direct Delivery to a partner, distributor model, with Bali now on their way and Java set to complete during H2.

This will give us the ability to effectively grow distribution and availability as we continue to develop the sparkling category and the reach of our brands, supported by the Coca-Cola Company. What we see is a very exciting consumer landscape for the future.

Damian Gammell: The last area I wanted to touch on ahead of taking your questions, and it will be one of the most important, is around digital and technology. We have talked before about operating from multiple platforms, our legacy as a business of mergers. The alignment of those systems as we move to our new technology platform, S/4HANA, is progressing to plan, with our first market, Germany, starting to go live in H2. Whilst nobody could ever describe SAP transitions as exciting, the unification of our data under one platform and the simplification of processes is enabling us to start to unlock more value through our multi-year investments in tech and AI, leveraging solutions and insights to drive top-line growth and productivity, and that is exciting.

The last area I wanted to touch on ahead of taking your questions, and I'll be one of the most important, is around digital and technology.

We've talked before about operating, from multiple platforms, our legacy as a business of mergers.

The alignment of those systems, as we move to our new technology platform, S4 HANA, is progressing. The plan with our first market, Germany, is to start going live in H2.

Whilst nobody could ever describe SAP transitions as exciting, the unique location of our data on one platform and the simplification of processes are enabling us to start to unlock more value through our multi-year investments in tech and AI.

Damian Gammell: We continue to evolve and improve Red One, our proprietary data-driven field sales tool, which gives every rep all of the information and analytics they need to help optimize routes, prioritize visits, review performance, and tailor our actions to each specific customer. We recently introduced an AI-based tool, which, through image recognition, enables them to dynamically track and record keystore measurements like share of visible inventory. CAM360 is now used by our 850 key account managers to effectively partner with their customers, enabling the creation of joint plans and effective trade investments. It supports areas such as pack price and promo simulations, price elasticity modeling, all of which are a critical part of leading revenue and margin growth management capabilities.

Leveraging solution and insight to drive topline growth and productivity, and that is exciting.

We continue to involve and improve Read 1, our proprietary data-driven field sales tool, which gives every rep all of the information and analytics they need to help optimize routes, prioritize visits, and review performance.

And tailor our actions to each specific customer.

Tool, which, through image recognition, enables them to dynamically track and record keystone measurements, like share of visible imagery.

Country 60 is now used by our 850 key account managers.

To effectively partner with their customers, enabling the creation of joint plans and effective trade investments.

It supports areas such as pack price and promo simulations.

Damian Gammell: We have recently begun piloting a new eB2B platform in Spain, Up We Go, which greatly simplifies the ordering process and strengthens our relationship with partner distributors in what remains a fragmented market. A lot more to come in this space. Back to where I started. We are pleased to have delivered a solid first-half performance. Given our year-to-date performance, strong commercial plans for the balance of the year, full year 2025 pricing in place, continued focus on productivity, and a good start to the second half, we are pleased to be reaffirming our full-year profit and cash guidance. It is an honor to lead a great business with strong fundamentals in place and operating in categories that remain healthy and growing.

Price elasticity modeling, all of which are critical parts of leading revenue and margin growth management capabilities.

And we've recently begun piloting, a new EB platform in Spain. Up we go, which greatly simplifies, the ordering process and threatens, our relationship with partner distributors in what remains a fragmented Market.

A lot more to come in this space.

So back.

To where I, I started.

We're pleased to have delivered a solid first-half performance.

Given our year to date performance, strong commercial plans for the balance of the year.

Full year 2025 pricing in place. Continued focus on productivity and a good start to the second half.

We are pleased to be reaffirming a full year profit and cash guidance.

Damian Gammell: Finally, to a quick reminder of our investment story on a page as we shared in May. We are confident we use the right strategy, done sustainably, to deliver on our mid-term growth objectives. We are winning today, but we are also focusing on creating tomorrow. Thank you all for joining us, and I will now hand back to the operator to facilitate your questions. Operator?

It's a joy to lead a great business with strong fundamentals in place and operating in categories that remain healthy and growing.

So finally, to a quick reminder of our investment story on a page, as we shared in May.

We're confident we have the right strategy done sustainably to deliver on our mid-term growth objectives.

We are willing today, but we're also focusing on creating tomorrow.

Operator: Thank you. We will now begin the question and answer session. As a reminder, we kindly request only one question per analyst. If you would like to ask a question, please press star one and one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star one and one again. Please stand by while we compile the Q&A queue. This will only take a few moments. Our first question comes from the line of Bonnie Herzog from Goldman Sachs. Please go ahead. Your line is open.

Thank you all for joining us, and I'll now hand back to the operator to facilitate your questions. Operator.

Thank you. We will now begin the question-and-answer session. As a reminder, we kindly request only one question per analyst.

If you would like to ask a question, please press *1 and 1 on your telephone and wait for your name to be announced.

If you wish to cancel your request, please press *1 and then 1 again.

Please. Stand by while we compile the Q&A queue. This will only take a few moments.

Bonnie Herzog: All right. Thank you. Hi, everyone. I just had a question on your guidance. You touched on this. You did lower the top lines slightly, but it does still imply an acceleration of growth on the top line in the back half, but essentially stable growth on the bottom line in 2H versus 1H, I guess suggesting higher expected OpEx. So, hoping to get a little bit more color on the drivers of this and maybe a sense of the drivers in terms of contribution. You are expecting some price mix versus volume growth in the second half. Thank you.

Our first question comes from the line of Bonnie. Herzog, from Goldman Sachs, please go ahead. Your line is open

Damian Gammell: Hi, Bonnie. I will take the first part and then hand it to Ed. We have seen our business accelerate coming out of Q1. We had a very strong Q2, both in Europe and APS, and we see that continuing. You are absolutely correct. Even with the slight change on the revenue top line, we do see acceleration we have had through the second half of the year, and then obviously our focus will turn into 2026. As I mentioned in the comments, a big part of that has obviously been volume growth coming back in our business in Q2. We see that continuing. It is also a reflection of the price mix. Our price mix per case, I think, was excellent in the first half of the year. Again, that reflects pricing being in place right the way through to the end of the year.

All right. Thank you. Hi, everyone. I just I had a question on your guidance. I mean you touched on this, you know, you did lower the Top Line slightly, um, but it, it does still imply an acceleration of growth on the top line in the back half but essentially stable growth on the bottom line in 2H versus 1 age. I guess suggesting higher expected Opex. So hoping, you know, to get a little bit more color on the drivers of this and, you know, maybe a sense of of the drivers. In terms of contribution, You're Expecting from Price mix versus volume growth in the second half. Thank you.

Hi, Bonnie. Um, I'll take the first part and then, um, hand it to Ted. So, we have seen our business accelerate coming out of Q1. You know, we had a very strong Q2 both in Europe and APS.

Um, and and we see that continuing, so, yeah, you're absolutely correct. Uh, even even with the slight change on the revenue Top Line, uh, we do see acceleration because through the second half of the year and then obviously our Focus will turn into into 2026.

As maintenance in the Commons, a big part of that is obviously mean volume growth coming back in our business in Q2.

Damian Gammell: That gives us confidence in our top line number. Then I will pass on to Ed just to kind of talk to the bottom line changes between half one and half two.

Ed Walker: Yes, thanks, Damian, and thanks, Bonnie. We are very pleased with H1, 2.5% revenue, very well leveraged to a 7.2% profit. For H2, although the volume is greater, we see more of that coming from volume itself and a bit less from revenue per case. As Damian mentioned, the geographical mix will not be as much of a benefit in the second half. We expect more from volume. We also have some OpEx phasing between the halves, so that is why we are assuming a similar 7% profit delivery for the second half.

Uh, we see that continuing, um, it's also a reflection of the price mix, you know, our our price mix per case. I think was excellent in the first half of the year, um, and again that reflects pricing being in place, you know, right the way through to the end of the year. So that gives us confidence in in our Top Line number. Um, and then, I'll, I'll pass on to Ed just to kind of talk to the bottom line changes between half 1 and half 2. Yes, thanks Damian and thanks Connie. Um, so yeah. I mean, we're very pleased with H1. You know, 2 and a half percent Revenue. Very well leveraged to a 7.2%, uh, profit, um, for H2. Um, although the volume is greater we see more of that coming from, um, uh, uh, volume itself and a bit less from, um, Revenue per case. And as Damian mentioned, you know, the geographical mix, um, will not be as much of a, a benefit in the second half. Um, and we, as I said, we expect more from volume. We also have some Opex phasing, um,

between the half. So that's why we're assuming a similar 7% profit delivery for the second half.

Bonnie Herzog: Okay, thanks. I'll pass it on.

Okay, thanks; I'll pass it on.

Operator: Thank you. Our next question comes from the line of Simon Hales from Citi. Please go ahead.

Thank you.

Our next question comes from Simon, who hails from City. Please go ahead.

Edward Mundy: Oh, hi, Damian, Ed, Sarah. Damian, I wonder if you could just sort of touch a little bit more on your comments around the stronger Q3 trading or the good Q3 trading you have seen to date. What have you been seeing a little bit more regionally, particularly perhaps in Europe, as the better weather through July and hopefully into early August been helping? Maybe a little bit of color as to the continuation perhaps you are seeing of away from home growth in Europe and the drivers around that, how broadly spread is that across different markets? Then associated with that, the APS performance into Q3, given the flooding you called out in the Philippines. How should we think about the scale of the impact that may have on the Philippines business for the rest of the second half?

Damian Gammell: Yeah, thanks, Simon. So, maybe I'll touch on the second part and then come back to the more European summer question. Obviously, we've reflected in our guidance some of the tougher weather comms in the Philippines. That's obviously reflected in what we shared today. I'm also pleased that we've seen a stabilization in Indonesia, particularly in July and through August. I think that's great for our teams to start seeing some reward for a lot of effort. That's certainly something we're looking to continue into the second half and more importantly into 2026. All of that's reflected in the outlook for APS. Just to call it out, again, our businesses in Australia, New Zealand, and the Pacific Islands also had a really, really strong performance as well year to date. In Europe, you're quite right.

Oh, hi. Damian, it's Sarah. Um, so Damon, I wonder if you could just sort of touch a little bit more on, um, your comments around the, the stronger Q3 trading, or the good Q3 trading, you've seen to date. You know what, what have you been seeing a little bit more regionally, particularly perhaps in Europe, you know, as the as the better whether through July and hopefully into early August been helping maybe a little bit of color as to the continuation. Perhaps you're seeing of a away from home growth, uh, in Europe and the drivers around that. How broadly spread is that, you know, across different markets, uh, and then associated with that, you know, the aps performance into Q3 given, you know, the flooding you called out in the Philippines, how how should we think about, you know, the scale of the impact that may have, uh, on the Philippines business to the right? So the second half. Yeah.

Thanks Simon. Um, so so maybe I'll touch you on the second part and then come back to to the more, uh, European summer questions. So obviously, we've we've reflected in our guidance. Um,

Damian Gammell: As we sit in London today, I'm happy looking out the window to see the sun shining. We have had some really good weather across Europe. That really came in end of June, definitely had a big impact on our July business, which was great. Clearly, we're looking forward to seeing that continue through August. It's pretty broad across all of our markets. I'd say if you look at the first half numbers, GB is a standout. Again, obviously, that reflected the strong performance to June. We've also seen the benefit of that warmer weather in July in GB as well. Yeah, long may it continue. It's great for the category, and it's something that we're definitely enjoying, and it's definitely helping.

You know, some of the tougher, uh, weather comes in the Philippines. Um, so that's, that's obviously reflected in what we share today. I'm also pleased that, you know, we've seen a stabilization in Indonesia, particularly in July, and through August. So, I think that's, that's great for a team to start seeing some reward for a lot of efforts. So that's certainly something we're looking to continue into the second half and more importantly into 2026. So all of, that's reflected in the outlook for APS and, you know, just to call it out again, our businesses in Australia, New Zealand, and the Pacific Islands. Also had a really really strong performance as well here today in Europe, you're you're quite right as we sit in London. Today, I'm happy. Looking at the window to see the sun shining, you know, we have had, you know, some some really good weather across Europe.

That really came in end of June. Definitely had a big impact on our July business, which was great. Um, and clearly, you know, we're looking forward to seeing that continue through August, it's pretty broad, uh, across all of our markets. Um, I'd say if you look at the first half numbers, GB is a standout, um, and again, obviously that that reflected the strong performance to June but then also we've seen the benefit of that warmer weather in July in GB as well, so, yeah. Long, may it continue, um, it's great for the category, um, uh, and it's something that, you know, we're definitely enjoying and it's definitely helping

Edward Mundy: Brilliant. Thank you.

Brilliant, thank you.

Operator: Thank you. Our next question comes from the line of Edward Mundy from Jefferies. Please go ahead.

Thank you.

Our next question comes from the Lion of Edward. Mandy from Jeffrey's. Please go ahead.

Edward Mundy: Afternoon, Damian and Ed Walker. Just coming back to Europe and the volume section that you have seen, I think it was pretty important to get volume growth back into Europe this year after the difficult year last year. If I do take a step back on what you have seen year to date within Europe, I think the revenue per case has probably been quite a bit stronger than what we have been modeling medium term as part of that model. Does this give you confidence putting weather to one side and the ability of the business to grow volumes within Europe over the medium term in terms of what you are seeing there?

Damian Gammell: Yeah, absolutely, Ed. I mean, I think volume growth is a key focus for us in Europe and across all of our markets. But as you rightly pointed out, particularly in Europe, we have seen that in Q2. We will see that in the second half of the year as well. Clearly, our priority is to try and get that volume accelerated. I think some of the campaigns that we have coming, whether it is Star Wars, whether it is EPL in the U.K., whether it is some of the innovation around Fanta and Sprite, and a lot of this will roll into 2026, certainly provides us with the consumer excitement to drive volume. We have seen volume growth in Q2. As I said, we would like to see that accelerate as we go through the year.

Um, afternoon, um, team and Ed. So just come back to Europe and the volume of infection that you've seen. I think it was, you know, pretty important to get volume growth back into Europe this year, um, after the difficult year, um, you know, last year. And if I did take a step back on what you've seen year-to-date, you know, within Europe, I think it's fair to say the revenue per capita has probably been quite a bit stronger than what would be modeled medium-term as part of that model. But does this give you confidence, you know, putting weather to one side, um, and the ability of the business to grow volumes, you know, within Europe, you know, over the medium term in terms of what you're seeing there.

Yeah, absolutely. I mean, I think volume growth is a key focus for us in Europe, well, across all of our markets, but as you rightly pointed out, particularly in Europe. You know, we've seen that in Q2, and we'll see that in the second half of the year as well. You know, clearly, our priority is to try and get that volume accelerated. I think some of the...

Campaigns that we have coming, whether it's Star Wars, whether it's EPL in the UK, whether it's some of the Innovation around fandom Sprite and a lot of this will roll into 2026, you know, certainly provides us with the consumer excitement to drive volume. Um, we you know we have seen volume growth in Q2. Uh, as I said, we'd like to see that accelerate as we go through the year.

Damian Gammell: Our price mix has overdelivered, and we have made some, I think, sensible choices around price promo in some of our markets, and that is reflected in certainly a higher price mix in the P&L. So, as I look mid-term to kind of come back to your question, I see volume growth in Europe. I see away from home growing again. That is a different narrative than we have had for quite a while. That is exciting. We are committed to driving away from home. We are taking a very active role in that through cooler placements. Share a Coke was a great example of trying to excite consumers in away from home.

Here, um, a price mix, you know, has over-delivered?

And we've made some, I think, sensible choices around price promotion and some of our markets.

Um and that's reflected in certainly a higher price price mix uh in the p&l. So

As I look midterm to to kind of come back to your your question, you know, I see volume growth in Europe.

Um, I see a way from home growing again. You know, that that's a different narrative than we've had for quite a while. That's exciting. You know, we're committed to driving away from home, you know, we're taking a very active role in that through cooler placements.

Damian Gammell: Also, Monster and away from home is becoming a bigger part of our narrative as we place coolers, but also secure listings of our energy portfolio in probably not your typical energy outlets like QSR and FSR, but obviously that works. Then if I move beyond that, you kind of get into some probably more medium-term initiatives around ARTD, which certainly on the revenue side contribute obviously a bit less on volume. But putting all that together, I think, to me, gives us a lot of confidence in mid-term volume growth. A couple of passion points that I think are worth calling out. Certainly, Coke Classic. We are launching a half-liter can in some of our markets. We are bringing more innovation around Coke Classic.

Away from home.

You know, also mothers turning away from home is becoming a bigger part of our narrative as we place coolers but also secure listings of our energy portfolio. You know, probably not your typical energy outlets like QSO or an FSO. But, obviously, that works.

And then if I, you know, move beyond that, you kind of get into some probably more medium-term initiatives around ARTD, which certainly on the revenue side contribute a bit less on volume.

but putting all that together, I think, um,

To me gives us a lot of confidence in mid-term, volume growth uh couple of passion points that I think are worth calling out.

Certainly Co classic.

Damian Gammell: Then for all of us who live in the U.K., I think it is fantastic to see Diet Coke back as a focus for the system with This Is My Taste campaign. That is starting to work. Clearly, again, that is another initiative that would support volume growth in what is the most competitive segment of soft drinks, but also the fastest growing. So all of that together gives us confidence in mid-term volume growth. That starts in Q2. It has got to continue in Q3 and into Q4, and that gives us confidence for the full year.

You know, we're launching a half-liter can, and in some of our markets, we're bringing more innovation around Coca-Cola Classic.

And then for all of us who live in the UK, I think it's fantastic to see Diet Coke.

Back as a focus for the system, which, you know, with this is my taste campaign, you know, that's starting to work. Um, and clearly again, that's another initiative that would support volume growth. In, what is the most competitive segments of soft drinks? But also, the fastest growing

Yeah, so all of that together, you know gives us confidence in mid-term volume growth.

That starts in Q2, it's got a continuing Q3 and into Q4. Um, and that gives us confidence for the full year.

Edward Mundy: Thank you.

Operator: Thank you. Our next question comes from the line of Lauren Lieberman from Barclays. Please go ahead.

Thank you.

Bonnie Herzog: Great, thanks. Good morning. First, I have a comment on the Q&A slide in the deck. Very, very cute, guys. I like it. If anyone hasn't noticed, you got to check it out. Question is, Damian, I felt like you had some pretty pointed commentary on the competitiveness in the market and emphasizing that you take a quote multi-year view on the approach. Just kind of wondering what's beneath that. Are you seeing particular flare-ups in given markets, given categories that feel a bit different than maybe what we would have been talking about a couple of months back? Thanks.

Our next question comes from the line of Lauren Lieberman from Barclays. Please go ahead.

Great. Thanks. Good morning. Um, first I have to comment on the um Q&A slide in the deck. Very, very cute, guys. I like it. Um, if anyone hasn't noticed, you got to check it out.

Um,

Question is Damian. I felt like you had some pretty pointed commentary on the competitiveness in the market and emphasizing that you take a quote multi-year view on the approach. So just kind of wondering what's beneath that um are you seeing you know particular flare ups in given markets given categories. Um that that feels a bit different than maybe what we would have been talking about a couple months back. Thanks.

Damian Gammell: Thanks, Lauren. Not significantly different, I would say, to what has been really part of our story in Europe. It is a very exciting, high-growth, profitable category. So, it always remains competitive whether you look at soft drinks or energy. I do not see a massive change in that space. I do see in some of our markets, we have had maybe a little bit less promo intensity as we have not quite landed some of our commercial agreements with some of our bigger customers. It has not got to the point of a lot of delistings, as you may have seen in other industries, but clearly, that is something that we continue to manage. That comes back to Ed Walker's point in terms of really managing the category for sustainable value creation.

Thanks, Lauren. Not significantly different, I would say, to what's been really part of our story in Europe. I mean, it's very exciting.

High growth profitable category. So, it's always remains competitive, whether you look at solving or energy. I, I don't see a massive change in that space.

Um, I do see in some of our markets, you know, we have had...

Maybe a little bit less promo intensity. As we haven't quite landed, some of our commercial agreements with some of our bigger customers.

You know, it hasn't gotten to the point of a lot of delistings, as you may have seen in other industries. But clearly, you know, that's something that we continue to manage. And that comes back to Edge Point in terms of...

Damian Gammell: So, we will continue to make decisions beyond the calendar year to make sure that we maintain solid, profitable growth for us and our customers, and we continue to do that. It is not, I would say, more challenging than other years. It just remains part of the ongoing doing business in Europe. We have seen some aggressive promo pricing from some of our competitors, particularly in GB. That is not a new dynamic, and it is something that we are responding to. We have got a very profitable business in away from home. As we have talked about before, we look at our pricing and promo decisions through that lens to make sure we continue to protect and grow that away from home business. So, it is a good competition, I would say, particularly in energy. I would not say it is much different to previous years, Lauren.

Really managing the category for sustainable value creation. So, you know, we will continue to make decisions.

You know, beyond a calendar year, uh, to make sure that we maintain, you know, solid profitable growth for us and our customers, and we continue to do that. So it's not, I would say, more challenging than other years. It just remains, you know, part of the ongoing, uh, doing business in Europe. Um, we have seen some aggressive promotional pricing from some of our competitors, particularly in GB.

Again, you know, that's not a new Dynamic, um, and it's something that we're we're, we're we're, we're responding to, but again, we've got a very profitable business in a way from home.

And as we've talked about before, you know, we look at our pricing and promo decisions.

Through that lens, to make sure we continue to protect.

And grow that away from home business. So yeah, it's it's good, it's a good competition. Um, I'd say particularly in energy, um, yeah, but I wouldn't say it's much different to previous years, Lauren.

Operator: Okay, great. Thanks. Thank you. Our next question comes from the line of Richard Whitigan from Kepler Shivra. Please go ahead.

Okay, great. Thanks.

Thank you.

Our next question comes from the line of Richard with again, from Kepler chevre. Please go ahead.

Edward Mundy: Yeah, hi, Damian, Ed, and Sarah. One question on the Share a Coke campaign. It has been launched earlier this year, and Damian, you mentioned, it has been well received. So, what are some of the metrics that you track to analyze the success of the Share a Coke campaign, and what are the pros and cons of a global campaign compared to a more local-oriented campaign?

Long story this year, and Damen, you mentioned this has been well received. So what are some of the metrics that you track to analyze the success of the Share Code campaign? And what are the pros and cons of a global campaign compared to a more locally oriented campaign?

Damian Gammell: Thanks, Richard. I think with our brand portfolio and with a full calendar, we will continue to have global and local, and both of them, I think, play a great role in our growth story. I think Share a Coke was particularly impactful because it is a great example, I think, of going above the line, whether that is on social media, all the way through to packaging in store. It is obviously something that excites consumers. We have seen that on our customers. When we think about metrics that we would look at, we clearly look at our way to display share a shelf distribution, and obviously, campaigns like that allow us to drive more of that. We would look at weekly and monthly drinking consumption, and we see that improving.

Thanks, Richard. Well, I mean, I think...

With our brand portfolio and a full calendar.

We'll continue to have global and local, and both of them, I think, play a great role in our growth story. I think 'Share a Coke' was particularly.

Impactful.

Social media, all the way through the packaging in store, is obviously something that excites consumers. So, we've seen that with our customers. When we think about the metrics that we would look at...

You know, we clearly look at our way to display, share a shelf.

Distribution and, obviously, campaigns like that allow us to drive more of that.

Damian Gammell: Then obviously, over time, it will reflect in brand health metrics that we look at with The Coca-Cola Company. It is clearly innovative across our cola portfolio. A lot of focus on single serve, and that really helps our price mix, as you have seen in our results. We were particularly happy, and it kind of goes back to what I talked about in terms of getting behind that away from home growth. We talked about it in Q1 that Share a Coke would be more skewed towards single serve, and that would definitely help support growth in away from home, and we are seeing that. Still early days in some of the metrics, but overall really positive, and very well received. I think it was eight years since we last did it.

Uh, we'd look at weekly and monthly drinking consumption. Um, you know, and we see that improving. Um, and then obviously over time, it'll be reflecting brand health metrics that we look at with the company, but it's clearly innovative.

You know, across our cola portfolio, there is a lot of focus on single serve.

Um, you know, that really helps our price mix that you've seen in our results.

Um, so we were particularly happy, and it kind of goes back to what I talked about in terms of getting behind that away-from-home growth. We talked about it in Q1 that Share a Coke would be more skewed towards single serve.

Damian Gammell: A lot of people were really happy to see it come back, and certainly, we are happy to see it coming through in our volume and price mix numbers.

And that would definitely help support growth away from home. We're seeing that; it's still early days for some of the metrics, but overall, it's really positive. Yeah, it's been very well received. I think it was eight years since we last did it, so a lot of people were really happy to see it come back. And certainly, we're happy to see it coming through in our volume and price mix numbers.

Edward Mundy: Thanks, Damian.

Thanks Amy.

Operator: Thank you. Our next question comes from the line of Eric Serotta from Morgan Stanley. Please go ahead.

Thank you.

Our next question comes from the line of Eric Sata from Morgan Stanley. Please go ahead.

Edward Mundy: Great. Good morning, good afternoon, guys. Can you talk a bit about the acceleration that you have seen in away from home this year and any read into the state of the consumer from that? Then, Damian Gammell, you talked in Manila about the, I think your language was, sparkling growth in Europe represents one of the biggest mid-term opportunities for Coca-Cola Europacific Partners, just when you look at the scale of that business. So, maybe you could revisit or talk about some recent initiatives to reinvigorate that sparkling growth in Europe.

Damian Gammell: Yeah, thanks, Eric. Sparkling has been growing in Europe pretty consistently in revenue. I think where we've been more focused on is driving, as we mentioned earlier, more volume within that revenue price mix. We're definitely seeing that in Q2. As a category in Europe, it's very healthy. It's quite dynamic. There's a lot of innovation, both from us, from others. That's really been a consistent theme in revenue growth. I think what we've recognized is that as volume becomes part of that, it's a more sustainable outlook, and that's really what we're focused on. We've seen that in Q2. Obviously, we benefited from Easter, so that definitely helped our Q2 number. We expect to see it in Q3 and Q4. Overall, it's really maintaining that revenue growth, but bringing volume as a bigger part of the mix, and that's our priority for the rest of this year.

Great. Um, can you oh good? Good morning. Good afternoon, guys. Um, can you talk a bit about the acceleration that you've seen in away from home this year and any read into the state of the consumer from that? And then, uh, Damian, you talked in Manila about the I think you're, you're you're language was uh, sparkling growth in Europe represents, you know, 1, uh, 1 of the, uh, biggest midterm opportunities for CCP, you know, just when you look at the scale of that business. So, um, maybe you could revisit or revisit or, uh, talk about some, uh, recent initiatives to, you know, reinvigorate that sparkling growth in Europe.

Yeah, thanks. Thanks, Eric. I mean, sparking has been growing in Europe, um,

Pretty consistently in revenue. I think where we've been.

More focused on driving, you know, as we mentioned earlier, more volume within that revenue price mix.

Damian Gammell: It's our priority for 2026, and I think into 2027. We certainly see that opportunity. For Coca-Cola Europacific Partners particularly, we see that in the light colas on the back of particularly a stronger Zero platform and Diet Coke. As we talk to Manila, we under-index in our flavor share. I think we see the opportunity to grow volume in flavors to support that revenue growth. Coming back to away from home, we do see more people out and about. Obviously, weather helps. Clearly, terraces are full. People are out enjoying what has been a good period of weather in Europe. We are seeing more people returning to the office. That has been a drag, particularly in our large cities. I think companies and employees are back in the office more than they ever were. That certainly helps our away from home business.

Um, we're definitely seeing that in Q2. Um, so as a category in Europe, it's very healthy. It, it's quite Dynamic. There's a lot of innovation, both from us from others. And that's, that's really been a consistent theme and revenue growth. I think what we've recognized is that, as volume becomes part of that, it's a more sustainable Outlook and that's really what we're focused on. So, you know, we've seen that in Q, Q2, obviously, we've benefited from Easter. So, you know that definitely helped our Q2 number, um, but we expect to see it in Q3 and Q4 so, you know, overall it's really maintaining that Revenue growth but bringing volume uh, as a bigger part of the mix. And, and that's our priority for the rest of this year. It's a priority for 26, and I think into 27. So we certainly see that opportunity and then for CCP particularly, you know, we see that in like colas

On the back of, um, particularly strong performance, as zero platform and Diet Coke. And as we talked to him, Manila, you know, we under-index in our flavor share.

Um, I think we see the opportunity to grow volume and flavors to support that revenue growth, just coming back to away from home. Um,

Damian Gammell: I think ourselves and a number of others have been supporting that part of the market over a number of quarters, whether that's cooler placements, consumer innovation, investment in signage, menus. Ultimately, it takes a bit of time, but that starts to feed through into footfall and incidents. We're definitely seeing that. Also some of our bigger customers, like McDonald's, are also pivoting their menu offerings, and that seems to also be driving a bit more traffic. It's great to see it returning to growth. It's obviously something we want to see on a multi-year basis. As I talked about in Manila, we've got to be a key contributor and driver of that. I come back to those elements that we can control.

Um, their menu offerings. That seems to also be driving a bit more traffic. So, yeah, it's great to see a return to growth. It's obviously something we want to see on a multi-year basis.

As I talked about in Manila.

Damian Gammell: So, better consumer engagement like Share a Coke, better cold drink availability and presence in store with more coolers, better execution on menus and incidents through better price mix, but also combo meals and activation. So, again, that will continue through the summer and then into next year. But all of that gives us confidence that the consumer is in a slightly better position in away from home in Europe than we've seen previously. Having said that, we're very interested in retail, you know, maintaining that affordability offering at the lower end is going to be a key part of our offering. And as we've talked to before, I think it's important that that also goes hand in hand with that premiumization that we've done a good job on over a number of years.

We've got to be a key contributor and driver of that. So I come back to, you know, those elements that we can control. So better consumer engagement, like 'Share a Coke.'

Better cold drink availability and presence in store with more coolers.

You know, better execution on menus and incidents through better price mix, but also combo meals and activation. So again, that will continue through the summer and then into next year. But all of that gives us confidence that the consumer, you know, is in a slightly better position in a way from home in Europe than we've seen previously.

Damian Gammell: So, whether it's mini cans, glass, small PET, because all consumers are not equal, and we see an opportunity to drive an offering across all of those price points, and that's what we're doing.

Having said that, we're very interested that in retail, you know, maintaining that affordability offering at the lower end is going to be a key part of our offering. And as we've talked about before, I think it's important that that also goes hand in hand with that premiumization that we've done a good job on over a number of years. So whether it's mini cans, glass,

Small PT, um, because all consumers are not equal and and we see an opportunity to drive an offering across all of those price points, and that's what we're doing.

Edward Mundy: Great. Thanks so much. I'll pass it on.

Great. Thanks so much. I'll pass it on.

Operator: Thank you. Our next question comes from the line of Nadine Sarwat from Bernstein. Please go ahead.

Thank you.

Our next question comes from the line of Nadine Sawat from Bernstein. Please go ahead.

Edward Mundy: Hi, thank you. Good afternoon, guys. One question from me coming back to the medium-term guidance. I hear you loud and clear on Indonesia being a headwind that was large enough to at least make you have the full year guidance. Now, it's a range versus a previous more specific number. If we turn our attention to the medium-term growth algo, does Indonesia impact your view? I get that you've reiterated that algo, but are you assuming that Indonesia then subsequently accelerates, or do you feel like you have enough levers elsewhere to offset the weakness? Thank you.

Hi, thank you. Good afternoon, guys. Um, one question for me. Uh, coming back to the medium-term guidance, so, um, I hear you loud and clear on Indonesia being a headwind that was, you know, large enough to at least make you have the full-year guidance now as a range versus a previous more specific number. But if we turn our attention to the medium-term growth algo, does Indonesia impact your view? I get that you've reiterated that algo, but are you assuming that Indonesia then subsequently accelerates? Or do you feel like you have enough levers elsewhere to offset the weakness? Thank you.

Ed Walker: I think, Nadine Sarwat, when we look at Indonesia, we are not assuming that there is a significant turnaround in the medium term that drives our 4% on the top line. We have talked before about high single digit, which I still think is the right, longer-term plan for Indonesia. While it is disappointing that the changes that have been made have not had more of an impact, and the macro effect is clearly playing on the numbers, we should keep in mind as well, though, it is a relatively small part of our business. So, it is a big opportunity going forward, but it does not have a very material effect on our numbers year in, year out. So, the long-term opportunity still remains, but no, we are not dependent on a very significant turnaround to deliver our mid-term objectives.

I think Nadine when we look at Indonesia so um we're not assuming uh that there's a sub. Um a significant turnaround, you know, in the medium term uh that drives our 4% uh on the top line we've talked before about high single digit which we I still think is the right. You'd no longer term.

You know, plan for Indonesia. Um,

Damian Gammell: Yeah, just to build on what Ed said, Nadine, and to give some credit to our team in Indonesia, we have seen a slight improvement in our performance coming out of July and into August. Again, we believe in the long-term opportunity of that market. But to Ed's point, it has more of an impact on revenue and cases, but less on the bottom line, which is really reflected in our guidance today.

You know, whilst it's a it's disappointing that the changes that have been made uh haven't had a more, an impact and the macro uh effects is clearly playing on the numbers. Um, we should keep in mind as well though. It's a relatively small part of our business. So it's a big opportunity going forward, but it doesn't have a a very material, uh, effect on our numbers, um, year in year out. Um, uh, so, you know, the long-term opportunities Still Remains. Um, but no. We're not dependent on a, a very significant turnaround to deliver our mid-term objectives.

Yeah, just to build on what Ed said, Nadine, and to give...

Some credit to our team in Indonesia. We have seen a slide improvement in our performance coming out of July and into August.

Um, and again, you know, we believe in the long-term opportunity of that market. But the Ed's Point has more of an impact on revenue and cases, but less on the bottom line, which is really reflected in our guidance today.

Edward Mundy: Very clear. Thank you.

Very clear. Thank you.

Operator: Thank you. Our next question comes from the line of Matthew Ford from BNP. Please go ahead.

Thank you.

Our next question comes from the line of Matt Ford from BNP. Please go ahead.

Edward Mundy: Thank you. Good afternoon, Damian, Ed. Just a question on Coke, actually. If you could update us on the situation for 2025, where are you in terms of hedging? Then, I suppose, more interestingly, into 2026, if you can comment at all on any of the major moving parts that you are expecting for 2026, without perhaps committing to a number, but an update on where you are hedging-wise for that year as well. Thank you.

Ed Walker: Yeah, thanks, Matt. We continue to be very pleased with the cost evolution and Cokes in general. We've been enjoying basically flat commodities for this year, and we anticipate that will roll into 2026. As you'd expect, at this point, we're very well hedged now for this year. On 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, leaving some room still to take advantage of any favorable movements in the market. Actually, some of the volatility that we've seen on the forward rates during 2025 has actually worked to our advantage. We've actually secured some nice forward prices on a number of our commodities.

Thank you afternoon, Damian Eadie, um, just a question on on cogs actually. Just, um, if you could update this on on the situation for for 25, where are you in terms of, um, hedging and then I suppose more interestingly, in, in the 26. Um, if you can comment at all on on any of the, uh, the major moving parts that you're expecting for 26 uh, without perhaps committing to a number. But um, and an update on where you are hedging wise, uh, for that year as well. Thank you.

Ed Walker: The outlook is still good with relatively flat commodities in 2026, which certainly makes life a bit easier in some parts of the P&L as we look forward.

Um, we're around 60% at this stage for, for 2026, which is roughly where we would like to be at this stage of the year. So, leaving some room still to take advantage of any favorable, um, movements in the market. Um, and actually, some of the volatility that we've seen on the forward rates during 2025 has actually worked to our advantage. So, we've actually secured some nice, uh, forward prices on a number of our Commodities. So, the, the Outlook is, is still good with, um, relatively flat Commodities and 26, which, you know, certainly, um, makes, uh, life a bit easier in some parts of the p&l as we look forward.

Edward Mundy: Great. Thank you.

Right. Thank you.

Operator: Thank you. Our next question comes from the line of Charlie Higgs from Redburn. Please go ahead.

Thank you.

Our next question comes from the line of Charlie Hicks from Rothschild & Co Redburn. Please go ahead.

Edward Mundy: Yeah, hi, Damian, Ed. Hope you are both well. My question is on Australia, where Q2 marked the four-year anniversary of the Absolut & Sprite deal. If you go back in time, that Australia business earned a very healthy margin, but perhaps was not being run quite as effectively as it could have been. You then came in and trimmed the promotions, trimmed bulk water, realigned curves, etc. As Ed was saying, we still got the Manila shared service center potentially in the background. Can you just provide a bit of an update on where we are on the Australian margin turnaround story and whether you think it could perhaps get back to the very high teens, low 20s level that it previously earned? Thank you.

Yeah. Hi. Damian Eadie. Hope you're both well. Um my question is on Australia where Q2 marked the 4 year anniversary of the amateur deal and if you go back in time that Australia business earned a very healthy margin but perhaps wasn't being run quite as effectively as it could could have been you then came in and you know trimmed the promotions, trimmed bulk water realigned Curt Etc. Um and as Ed was saying, we still got the Manila shed service center potentially in the background. So Community just provide a bit of an update on where we are on the Australian.

Radio margin, turnaround story, and whether you think it could perhaps get back to the very high teens, low 20s level that it previously earned. Thank you.

Damian Gammell: Thanks, Charlie. Yeah, obviously, we're really pleased with our Australian business and the changes that have been made over a number of years. It's far from over in terms of the opportunity from our perspective. We're going through quite a big change and probably from a structural portfolio realignment, the last big one, which is the Beam-Santori change. That's going to allow us to become a bit more efficient, but also align our brand portfolio more to our global footprint. I think that's a positive. In some ways, that was a bit of the unlocker with The Coca-Cola Company deal as well, was to just line up with The Coca-Cola Company. We've seen the benefits of that. We will see that also on alcohol. It'll probably take a bit more time, but we're excited about that change. That will allow us also to look at our cost base.

Thanks Charlie. Um,

Yeah, obviously, we're really pleased with our Australian business and the changes that have been made over a number of years.

It it's far from over in terms of the opportunity, from our perspective. You know, we're going through quite a big change and and probably from a structural performance of the last big 1, which is the beam from Tori change. That's going to allow us to become a bit more efficient. Um, but also align our brand portfolio more to our Global footprint. And I think that's a positive and and in some ways that was a bit of the unlocker with the Kirk deal as well, was to just line up with the Coca-Cola company. And we've seen the benefits of that and and we will see that also on alcohol. It will probably take a bit more time.

Um, but you know, we're excited about that change.

Damian Gammell: We've invested some good capital into Australia to become more efficient. So, all of that will support margin expansion. We're not guiding to a target on a market-specific number. If I look at the macros in Australia, whether it's GDP, population growth, some of the great commercial work that we're leading down there, obviously, margin expansion due to the top line is definitely something we're excited about. Maybe I'll pass to Ed Walker, who'll talk a little bit more about the shared services opportunity as well that we see coming to play.

Also, to look at our call space, we've invested some good capital into Australia to become more efficient. So, all of that will support margin expansion.

We're not guiding to a target on a market-specific number. Um, but if I look at the macros in Australia, whether it's GDP or population growth,

Some of the great commercial work that we're leading down there, obviously margin expansion due to the top line is definitely something we're excited about. And maybe I'll pass to Ed, who will talk a little bit more about it.

Ed Walker: Yeah, thanks, Damian. Yes, Charlie, we are very pleased with the progress. We do not give the specific Australia profit numbers, but what I can tell you is that our revenue from 2021 has grown at a CAGR, if you look until the end of 2024, by 8% per year. So, a fantastic revenue performance. We have done better than that on the bottom line. So, we have had operating profit margin accretion over that time period.

You know, the shared services opportunity that we see coming into play.

Yeah, thanks, Damian. Um, yes, Charlie. I mean, we're very pleased with the progress. I mean, we don't give the specific Australia profit numbers. But, you know, what I can tell you is that our revenue from 2021 has grown at a CAGR, if you look until the end of 2024, by 8% per year. So, a fantastic revenue performance, and we've done better than that on the bottom line. So, we have had, you know, operating profits.

Ed Walker: As you called out, I think it is due to the investments we made in capacity, which have helped reduce the cost to serve, promo R&M and GM capabilities that we have leveraged in the market, and then some portfolio rationalization, both in terms of focusing on the core parts of the portfolio that add value, but also the work with The Coca-Cola Company in terms of aligning the roles of the different brands within the portfolio. Last but certainly not least, we have taken advantage of our shared services capabilities. Some activities out of Australia have already moved to Bulgaria, and we are looking forward to moving more stuff to Manila with the opening of our new center. Great progress, really pleased, and more to come there.

um, margin accretion over that time period. And as you called out, you know, I think it's due to the Investments we've made in capacity, uh, which have helped reduce the cost to serve, um, uh, promo, RN MGM, uh, capabilities that we've leveraged in the market and then some portfolio rationalization, both in terms of, um, focusing on the core part of the property that add value. Uh, but also for the work with Co company, in terms of aligning, the role of the different brands within the portfolio. And last, but certainly not least, we've taken advantage of our shared service capabilities. Uh, some activities out of Australia. Um, already moved to Bulgaria and we're looking forward to moving more stuff to Manila with the opening of our new, uh, new center. So great progress, really pleased and um, more succumbing

Damian Gammell: Thank you very much.

Thank you very much.

Operator: Thank you. Our next question comes from the line of Bonnie Herzog from Evercore ISI. Please go ahead.

Thank you.

Speaker 7: Great, thank you very much. Damian, it has been about two years, I think, since you rolled out Jack Daniel's and Coca-Cola in Europe. I was just wondering if you could maybe stand back and give an assessment of how that and other ARTD initiatives have gone. Any surprises, disappointments? What have you had to change and how you see that developing over time? Thank you.

Our next question comes from the line of Robert Ottone from Evercore ISI. Please go ahead.

To change and how you see that developing over time. Thank you.

Damian Gammell: Thanks, Robert. Overall, really pleased with where we are, particularly in a big market like GB. I think some of the learnings that we've taken on board from our experience in Australia is it's got to be a portfolio play. So, I talked about Bacardi & Coke. I talked about Sprite and Absolut. So, we certainly see a stronger performance across all of those brands, including Jack and Coke, when we go to the market with a category play. That takes a bit of time, but clearly, we're seeing the benefits of that quarter by quarter and year on year. So, along with energy in terms of absolute volume growth versus prior year, it's up there. In revenue growth, it's even higher, just given that it's all single serve. It's something that we're looking to expand across all of our markets in Europe.

Thanks, Robert. Um, I mean, overall, I'm really pleased with where we are, particularly in a big market like GB. Um, I think some of the learnings that we've taken on board from our experience in Australia is that it's got to be a portfolio play.

You know, so I talked about the Cardi and Coke, I talked about Sprite and Absolut, so we certainly see a stronger performance across all of those brands, including Jack and Coke, when we go to the market with a category play. Um, and that takes a bit of time.

Um but but clearly you know we're seeing the benefits of that you know quarter by quarter um and year on year. So you know along with energy in terms of absolute volume growth versus prior year it's it's it's up there in Revenue growth. That's even higher. Just given given, it's all single serve.

Um, and it's something that we're looking to expand.

Damian Gammell: So, it's been a quick two years, but I think the capability and the brand offering that we have now sets us up for many more years of exciting growth. Obviously, when you talk about Europe, the changes that are referenced in Australia are also very exciting because acquiring a brand like Bilson's, I think, demonstrates that we will be opportunistic with The Coca-Cola Company in a category like this, where maybe having local brands from time to time plays a bigger role. But the bulk of the growth will come from those global brand partnerships. So, overall, really good, Robert, and more to come.

You know, across all of our markets in Europe. So, yeah, it's been a quick two years. Um, but I think the capability and the brand offering that we have now sets us up for many more years of exciting growth.

And obviously, you know, when you talk about Europe, the changes that are referenced in Australia are also very exciting because, you know, acquiring a brand like Bilson's, I think demonstrates that we will be opportunistic with the company.

In a category like this, where having local brands from time to time plays a bigger role?

Ed Walker: I think what's particularly pleasing as well is we're really gaining momentum. These things don't happen overnight. It takes a while to get to know the category for the retailers, to better understand the category, but we've certainly seen an acceleration in the last six months to a year in ARTD, particularly in Europe.

But the bulk of the growth will come from those global brand partnerships. So, yeah, overall, really good, Robert, and yeah, more to come.

I think what 50 please as well is, you know, we are really gaining momentum. So, you know, these things don't happen overnight. It takes a while to get to know the category for the retailers, to better understand the category. But we have certainly seen an acceleration in the last 6 months to a year in ARTD, particularly in Europe.

Operator: Thank you. Our next question comes from the line of Mitch Collett from Deutsche Bank. Please go ahead.

Thank you.

Our next question comes from the line of Mitch Collet from Deutsche Bank. Please go ahead.

Edward Mundy: Hi, Damian. Hi, Ed. Hi, Sarah. I've seen the tagline from the CMD was "4 and more." Clearly, fiscal 2025 has been impacted by a few factors outside of your control, but how do you feel about that ambition for "4 and more" beyond fiscal 2025? Do you think fiscal 2026 is going to be at that range or above 4? I appreciate you are probably not that likely to guide now, but can you talk about how you think about fiscal 2026 and the steps that are going to take you there? Perhaps it is what you put on slide 15, but I would be interested to know what you are expecting to do to be able to accelerate to "4 and more." Thank you.

Hi Damian. Hi Ed. Hi Sarah. Um, I I, I think the tagline from the, um, CMD was was 4 and more. Um, clearly, fiscal 25 has been impacted by a few factors outside of your control, but how do you feel about that ambition for 4 or more Beyond fiscal 25? You you think fiscal 26 is going to be at that range or, you know, above 4, appreciate your probably, not that likely to guide now,

Damian Gammell: Yeah, thanks, Mitch. There's no change in our conviction around top line growth at Coca-Cola Europacific Partners. I think Q2 was a solid quarter, demonstrated that. If you look at what we've guided for the full year, you'll see that growth continuing in Q3 and Q4. We have had a couple of drags on revenue, certainly in the first half of this year. Some of that may continue into the second half, which is why we've updated today as we have. We've had the tea transition in Spain. Obviously, we've got Suntory out of Australia. We've had Indonesia, although, as I said, that is starting to show signs of improvement. Some of those are 2025 events. So, 2026 and beyond, I think you'll expect us to stick with our 4% revenue guidance.

But can you talk about how you think about fiscal 26 and and the steps that are are going to take you there? Perhaps, it's, it's what you put on, slide 15, but I'd be interested to to know what, your, what you're expecting to do to be able to accelerate to, to 4 or more. Thank you. Yeah, thanks, Mitch. I mean, there's no no change in our conviction around, Topline growth at CCP. I think you do, you know, was a solid quarter, demonstrated that. And I think if you look at what we've got here, for the full year, you'll see that growth continuing in Q3 and Q4, um, you know, we we have had, you know, a couple of

Uh, revenue drags on, certainly in the first half of this year, so I'm going to make a continuing transition to the second half, which is why, you know, we've updated today as we have. We've had the transition in Spain. Obviously, we've got some Tori out of Australia. Uh, we've had Indonesia, although, as I said, that is...

You know, we're starting to show signs of improvement. So, some of those are, you know, 2025 events. Um, for 2026 and beyond, I think you'll expect us to stick with our 4%.

Damian Gammell: As we continue to build out our portfolio and get smarter at some of the things that we're doing, our ambition for growth, in my view, is only going to get higher. I think a 4% guidance is a pretty good number, particularly with a 7% bottom line and that free cash flow. So, yeah, to answer your question, no change from Manila. It doesn't feel that long ago. Certainly, a good Q2 and a good start to Q3 continues to support that mid-term outlook and growth.

Revenue guidance. Um, and as we continue to build out our portfolio,

Hey, Ellen. Get smarter at some of the things that we're doing, you know, our ambition for growth was only, you know, in my view, is only going to get higher.

But I think a 4% guidance is a pretty good number, particularly with a 7% bottom line and that free cash flow. So, to answer your question, no change from Manila; doesn't feel that long ago. Um, and certainly a good Q2 and a good start to Q3.

You know, it continues to support that midterm outlook and growth.

Ed Walker: Understood. Thank you.

Understood, thank you.

Operator: Thank you. Our next question comes from the line of Sanjeet Aujla from UBS. Please go ahead.

Thank you.

Our next question comes from the line of Sanjit Allah from UBS. Please go ahead.

Edward Mundy: Hey, Damian, Ed, Sarah. Most of mine have been asked already, but just a point of clarification on some of the commercial agreements you missed out on in Europe. Is that something that is impacting through the course of the rest of the year, or some of that being resolved, and which markets impact?

Operator: were impacted, please. Thanks.

Sarah Willett: Yeah, no, so I mean, these are quite typical Sanjeet Aujla's emails. We try and, you know, land pricing and commercial terms for a year. We don't always land them in the timeframe that we'd like to. But again, nothing out of the ordinary. They're resolved. It was mainly in Q2, mainly a little bit in Germany and a little bit in Sweden were the two markets that I think were most impacted. But now in a good place for certainly the rest of this year. So yeah, no lingering effects from those as we go into the second half of the year.

Calls for the rest of the year or some of that been resolved and and which markets in particular were impacted, please. Thanks.

Ya know. So I mean these are

Quite typical Sanji as, you know, as we we try and, you know, land pricing and Commercial terms for a year, we don't always land them in the time frame that we'd like to. But again, nothing out of the ordinary, they're they're resolved was mainly in Q2 um, mainly a little bit in Germany and a little bit in Sweden where the 2 Market, I think were most impacted. Um but now in in in a good place for certainly the rest of this year. So yeah, no no lingering effects from those as we go into uh, the second half of the year

Operator: Got it. Just a quick follow-up on Indonesia, Damian, you are talking about some sequential improvement and stabilization. I am assuming that means stabilization in the rate of decline as opposed to getting back to growth.

Sarah Willett: Depends on what period you pick to compare to. I would say, genuinely on our sparkling portfolio, we start to see stabilization, which is really encouraging. I think on tea, we are probably a bit off that. We are launching a new tea format and a new tea pack and that is only going to come in in Q3. So I would say on sparkling, yes, tea, we have a bit of a way to go, but on a combined level, it certainly feels better than it has been feeling, which is great. On a consolidated level, it is important for us, but it is really important for the team locally to start to see some early wins and also for our customers as well because it is still a very valuable category for them in Indonesia.

Got it. Uh, and, and just a quick follow up on, on Indonesia, Damian, you're talking about some, uh, sequential Improvement, uh, Amit and stabilization now, I'm assuming that means stabilization in the rate of decline as opposed to getting back to growth, depends on what period you picked to compare to, uh,

Yeah, I'd say, you know, genuinely on our sparkling portfolio. You know, we started to see stabilization, um, which is really encouraging. Um, I think on T, we're probably a bit off that, you know, we're launching a new t format.

I'm a new t uh, pack and and VIs.

That's only going to come in in Q3 so I'd say I'm sparkling. Yes. T, we have a bit of a way to go, but on a combined level, it's certainly, you know, feels better than it than it has has been feeling, which is great, you know, on a Consolidated level it's important for us, but it's really important for the team locally to start to see some early wins.

Sarah Willett: So, more to come on that as we go through the second half of the year. Sparkling, leading it, tea still to come, Sanjeet Aujla, would be the way I would think about it.

Operator: Very helpful. Thank you.

Um, and also for our customers as well because it it it's still a very valuable category for them in Indonesia. So yeah. More to come on that as we go through the second half of the year but yeah, sparkling leading it. T still to come Sanji would be the way I think about it.

Very helpful. Thank you.

Damian Gammell: Thank you. Our last question for today comes from the line of Carlos Lavoie from HSBC. Please go ahead.

Thank you.

Our last question for today, comes from the line of Carlos from HSBC, please go ahead.

Ed Walker: Yes, hello. Thank you. Hi, Damian. Can you expand on your, give us a view on your trade management outlook in Europe, given where you are on your digital capabilities and the implementation of your digital capabilities? There is usually, you know, a good amount of low-hanging fruit there. Have you captured most of that already, you think, or is there a little bit more to go there?

Yes. Hello, thank you. Um, hi. Dan can you?

stand on your

well, give us a view on your trade management.

Outlook in, in, in Europe, given where you are on your digital capabilities.

Sarah Willett: Thanks, Carlos. It's certainly an area that we're very passionate and excited about, and we've invested quite a bit in terms of our tech capabilities. I kind of look at it through two lenses. In the more organized segment, particularly in Europe, Australia, and New Zealand, our MyCCEP.com platform is managing and capturing a lot of value in terms of information, revenue, and also driving good customer engagement. That's where we're on our way to a $3 billion revenue through that platform. I think on a consolidated trade level, there is always more to do, but it is a great foundation. I think where we've been making the most progress is in fragmented. As you know, a lot of our markets in Europe, a lot of the away from home is fragmented and goes through wholesale. It goes through a more diverse route to market, let's put it that way.

Um, and and the implementation of your digital capabilities. It it. There's usually, you know, a good amount of low-hanging fruit there. Have you captured most of that already you think, or, or is there a little bit more to go there?

Thanks Carlos. Uh, it's certainly an area that we're very passionate and excited about and we've invested quite a bit in terms of our

Tech capabilities. I kind of look at it through 2 lenses. Um so in, in the more organized uh segment of of particularly in Europe, Australia, um and New Zealand, you know, are my ccp.com platform

Is managing and capturing a, a lot of value in terms of information revenue and also driving. Good customer engagement. So I talked to we're on our way to a 3 billion.

Revenue to that platform. So, I think on a Consolidated trade level, you know, always more to do but a great Foundation, I think where we've been making the most progress is in fragmented. So,

As you know, a lot of our markets in Europe.

Sarah Willett: Currently, we're at 70% plus of the revenue in that part of the trade that we get visibility on at an outlet level. That's a big improvement from a few years ago. Then we're overlaying that with our broader B2B play in Spain, which mirrors some of the work you would have seen in Latin America and from Hellenic around a broader category platform for our distributors, which will allow them to digitize their route to market, allow us to get access to information. As you know, typically, the size of our partners in that part of the market, they don't have the balance sheet capability to build these platforms. I think we're bringing a tool that they need. It gives us transparency, and it'll allow us, I think, to accelerate some of that market development capability in the fragmented trade, particularly in Europe.

Um, a lot of the away-from-home is fragmented. Um, it goes through wholesale; it goes through a more, um, diverse route to market. Let's put it that way.

So currently we're at 70% plus of the revenue in that part of the trade that we get visibility on at an outlet level. So that's a big improvement from a few years ago.

And then we're overlaying that with our you know broader EB to be play in Spain.

You know which mirrors some of the work you would have seen in Latin America and from Hellenic around you know a broader category platform for our Distributors which will allow them digitize their route to Market allow us to get you know, access to information. Um and as you know typically the size of our partners in that part of the market they don't have the balance sheet capability to build these platforms. So I think we're bringing

Sarah Willett: Clearly, it could have a bigger role in the Philippines and Indonesia. That's certainly where we're going next. We'll continue the journey in Europe. We're already rolling out our MyCCEP.com platform, and then the next one will be that more fragmented trade tool. A lot has happened, but it's a super exciting part of the business. We'll continue to invest in it, and we'll continue to learn from other bottlers. I think one of the benefits of where we are now as part of the Coke system is there's a lot of sharing going on, particularly in this space. We're definitely moving a bit faster thanks to kind of lifting and shifting some capabilities from elsewhere.

A tool that they need it, it gives us transparency. Um, and it'll allow us. I think to accelerate some of that market development capability in the fragmented trade, particularly in Europe.

Clearly, it could have a bigger role in Philippines and Indonesia.

And that's certainly where we're going next. So we'll continue the journey in Europe.

And then the next 1 will be that more fragmented Freight Tool. But yeah, yeah. So so a lot has happened but it's a super exciting part of the business. Um, we'll continue to invest in it, um and we'll continue to learn from what our bottlers. I think 1 of the benefits of

Operator: Thank you.

Of where we are now as part of the KO system is there's a lot of sharing going on particularly in this space. Um so we're definitely you know, moving a bit faster. Thanks to kind of lifting and shifting, some capabilities from elsewhere.

Thank you.

Damian Gammell: Thank you. Our last question comes from the line of Usama Tariq from ABN Amro Auto BHF. Please go ahead.

Thank you.

Operator: Hi, good afternoon, team. Thank you for the opportunity. I just have a quick question with regards to the comparable free cash flows. Correct me if I am wrong, they are down year on year. Am I correct in assuming that this is more working capital related? Going into H2, I do understand that H2 is way stronger on a comparable basis. Do you see some risk there with regards to your comparable free cash flow guidance, especially if Indonesia remains weak? Thank you.

Our last question comes from the line of Usama. Tariq from ABN, Amro oddo bhf, please go ahead.

Hi, good afternoon team, thank you for the opportunity. Um I just have a quick question with regards to the comparable, free cash flows. So correct me if I'm wrong. Uh they're down year on year. Um,

Am I correct in to assume that this is more working capital related?

And then going into H2. Um, I do understand that H2 is uh, very stronger on a comparable basis.

Um, but do you see some risk there with regard to your comparable free cash flow guidance, especially if Indonesia remains weak?

Thank you.

Bonnie Herzog: Hi, thank you for the question. Yes, I mean, our comparable free cash flow at the first half, it is slightly below last year, but that is really working capital related and is purely phasing. Actually, when you look at the calendar, the half ended a little bit earlier than last year, ended on the 27th of June, I believe. It is 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. As we sit here today, we are confident to reaffirm the guidance for the year. Indonesia is, as I said earlier, a small part of our business and not a heavy drain from a free cash flow perspective.

Bonnie Herzog: We are confident in delivering at least the $1.7 billion for 2025.

Thank you for the question. So yes. I mean, our comparable free cash flow at the first half is slightly below, uh, last year. But that is really working capital, um, related and is purely phasing. So, actually, when you look at the calendar, um, the half ended a little bit earlier than last year ended on the 27th of June, I believe. Um, so it's purely a phasing item. If you look at previous years, we always do more free cash flow in the second half years in the first half year. Given, you know, the big summer, um, selling period in Europe. Um, and as we sit here today, know, we're confident to reaffirm the guidance, uh, for the year. Indonesia is as I said earlier, a a small pass for our business and not a heavy drain from a free cash flow perspective. Um, so we're confident in delivering at least 1.7 billion, uh, for 2025, yeah.

Operator: All right. Thank you.

All right. Thank you.

Damian Gammell: Thank you. I would now like to hand the conference back over to Damian Gammell for his closing remarks. Damian, please go ahead.

Edward Mundy: Thank you, operator. Again, a big thank you to everybody for joining us today. We are really happy we continue to execute on our growth strategy and are excited about the midterm outlook for Coca-Cola Europacific Partners. Very solid first half. I am pleased that we reaffirmed a full year profit and free cash flow guidance today. Europe's return to growth in Q2, and we see a better performance in away from home. Indonesia is a bit slower. However, we continue to be excited and make the changes necessary to unlock what we believe is a great longer-term opportunity for the group. Full year, we expect volume growth in Europe and in APS, despite Indonesia.

Thank you. I would now like to hand the conference back over to Damian gaml for his closing remarks Damian, please go ahead.

Thank you, operator. And, and again, a big thank you to everybody for uh, joining us today.

So we're really happy, we continue to execute on our growth strategy and our excited about the midterm outlook for CCP.

Very solid, first half and pleased. That we reaffirmed our full year profit and free cash flow guidance. Today, Europe's return to growth in Q2 and we see a better performance in away from home. You know, Indonesia is a bit slower. However, we continue to be excited and make the changes necessary to unlock. What we believe is a great longer term opportunity for the group.

Edward Mundy: Fundamentally, we continue to generate a lot of value for our customers on the back of being a great business with very strong brands, solid route to market, and a very exciting commercial calendar between now and the end of the year. Again, thank you for joining us. We look forward to updating you on our Q3 in November. Thank you.

Full year, we expect volume growth in Europe and an APS despite Indonesia.

And fundamentally, you know, we continue to generate a lot of value for our customers. On the back of being, you know, a great business with very strong Brands solid route to Market. Um, and a very exciting commercial calendar between now and the end of the year. So again, thank you for joining us. And we look forward to updating you um on our Q3 um, uh in November. Thank you.

Damian Gammell: That concludes our conference for today. Thank you for participating. You may all

That concludes our conference for today. Thank you for participating. You may all disconnect

Mhm.

Mhm.