Business Description:
Coca-Cola Amatil Limited (CCL) is involved in manufacturing, selling and distributing a diversified product portfolio including carbonated soft drinks, water, sports and energy drinks, fruit juice, flavoured milk, coffee and packaged ready-to-eat fruit and vegetable products. CCL is the Australasian regional anchor bottler of The Coca Cola Company. The company also sells and distributes the premium spirits portfolio of Beam Global Spirits & Wines.

Strategy Analysis:
CCL's key strategy is to grow the Australian beverages market by finding new outlets and to improve returns in the core business. At the same time it is investing heavily to increase fridges in Indonesia where strong GDP growth coupled with a large population and low penetration suggest good long-term growth potential. The alcoholic beverages business is another attractive growth avenue with CCL able to leverage its sales and distribution infrastructure to maximum effect. The Project Zero cost reduction program is a key contributor to profit growth in mature core markets. Value adding projects have been identified through to 2015. Acquisitions have played a part in diversifying to become a broader based beverage company. Neverfail was acquired for $225m in April 2003 and SPC Ardmona was acquired for $524m, diversifying into packaged fruit, in early 2005. The Pacific Beverages distribution joint venture with SABMiller was formed in 2006 to distribute alcoholic beverages and sold late 2011. The Korean business was sold in 2007. Coca-Cola Amatil reported NPAT down 27.8% to $153.6m for the half-year ended 1 July 2011. Revenues from ordinary activities were $2.26bn, up 2.4% from the same period last year. Basic and Diluted EPS was 20.3 cents compared to 28.3 cents last year. Net operating cash flow was $287.2m compared to $219.5m last year. The interim dividend declared was 22.0 cents compared with 20.5 cents last year. Looking ahead, the company will continue to focus on executing its organic growth strategy. The business continues to deliver efficiency and customer service improvements ahead of internal targets from the strong pipeline of capital projects, with returns generated on invested capital increasing to a record level of 17.6% for the half.