Coca-Cola Içecek Anonim Sirketi (CCOLA) Q1 2025 earnings summary

Executive summary

• Achieved 13.4% year-on-year consolidated sales volume growth in Q1 2025, reaching 387 million unit cases, with all major markets contributing positively, led by Türkiye (+8.4%), Pakistan (+17.2%), and Kazakhstan (+11.7%).

• Sparkling beverages grew 16.9% year-over-year, with stills up 8.7%; affordability, trade promotions, and consumer marketing, especially ahead of Ramadan, drove performance despite macroeconomic and regional challenges.

• Net sales revenue declined 3.8% year-on-year to TL 36.2 billion under inflation accounting (TAS 29); without TAS 29, revenue rose 33.2%.

• Net profit was TL 1.3 billion, a 66% year-on-year decrease, mainly due to higher interest expenses and lower monetary gain.

• Completed acquisition of Coca-Cola Bangladesh Beverages Limited, consolidated from March 2024.

Financial highlights

• Gross profit margin declined by 282 bps to 30.4%; EBITDA margin fell by 346 bps to 12.9%.

• EBIT dropped 35.2% year-on-year to TL 2.87 billion (TAS 29); EBIT margin fell to 7.9% (-385 bps).

• Net sales revenue per unit case dropped 15.2% year-on-year; without inflation accounting, it increased 17.4%.

• Free cash flow was negative TL 8.0 billion, reflecting continued investment ahead of demand.

• Cash and cash equivalents at period end were TL 21.85 billion, down from TL 25.59 billion at year-end 2024.

Outlook and guidance

• Management remains confident in full-year guidance, expecting margin and revenue normalization as the year progresses, with higher beverage demand expected in summer.

• Price increases were implemented in Türkiye in April and selectively in other markets; further improvements in net sales revenue per unit case and margins are anticipated.

• Cost base is largely hedged or contracted, providing visibility and stability for the remainder of 2025.

• Management expects the impact of cycling a low-cost base to phase out over the rest of the year.

• No adverse regulatory or legal changes are expected to impact business operations.