UPDATE 2-Russia, cuts lift Coke bottler CCH, offset austerity

* Q3 comparable net profit rose to 216 million euros

* Strong volume in Russia, cost savings help

* Shares down 0.8 pct

(Adds CEO’s comments, details)

By Angeliki Koutantou

ATHENS, Oct 27 (BestGrowthStock) – Greek Coke bottler Coca-Cola
Hellenic (CCH) (HLBr.AT: ) eked out a modest rise in quarterly
profit, driven by a sharp rebound in Russia and cost cuts that
offset the impact of austerity measures in several countries.

CCH, the world’s second-largest bottler of Coca-Cola (KO.N: ),
has been cutting costs since late 2008 to deal with the impact
of the credit crisis and shaky economies, which have crimped
product demand.

The cuts appeared to be bearing fruit on Wednesday as the
bottler posted a 3-percent increase in comparable net profit to
216 million euros ($301.4 million) from 210.2 million in the
same period last year.

The profit was slightly below an average forecast of 219.6
million euros in a Reuters poll but within the estimate range.

“As long as sales volume remain on positive ground and
conditions in its markets do not worsen, cost savings will
increasingly boost the bottom line,” said Investment Bank of
Greece analyst Natalia Svyriadi.

CCH reiterated the cuts would boost this year’s operating
profit by 36 million euros and yield additional annual benefits
of 20-25 million euros in the coming years, but declined to
provide any profit guidance.

“Looking forward, we remain cautious with regards to
macroeconomic developments across our geographies and expect the
timing and degree of recovery to vary across our markets,” CCH
Managing Director Doros Constantinou told Reuters.

A 30-percent sales volume rise in Russia thanks to an
exceptionally hot summer and an economic recovery there more
than offset tough conditions in austerity-hit countries such as
Greece, Hungary, Bulgaria and Romania, the company said.

Sales volume rose 5 percent year-on-year to 611 million unit
cases, more than expected, after four straight quarters of
decline. Foreign exchange gains also supported profit and the
company said it expected a total benefit of 65 million euros for
the full year.

At 0838 GMT, shares in the bottler, which bottles and
distributes Coke, Sprite and Fanta in 27 countries in Europe and
in Nigeria, were down 0.8 percent at 19.20 euros,
underperforming the Athens bourse general index (.ATG: ), which
lost 0.6 percent.

CCH trades at 15.8 times its estimated 2010 earnings versus
a multiple of 13.7 for Coca-Cola Enterprises (CCE.N: ), the
world’s largest Coke bottler, according to data from Thomson
Reuters I/B/E/S.

The firm will wait for the Greek government to complete a
review of corporate taxation by the end of November before
deciding if it will pay out a dividend, Constantinou said. CCH
has continuously paid out dividends over the past nine years.

Greece is implementing a multi-billion-euro plan to slash
its debt and budget deficit, including a windfall tax on large
companies’ profits and a 40-percent tax on dividends.
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UPDATE 2-Russia, cuts lift Coke bottler CCH, offset austerity