Coca-Cola HBC (LON:CCH) reported “another strong year” in 2025, delivering organic revenue growth of 8.1% and volume growth of 2.8% while continuing to invest in its portfolio, commercial capabilities, people, and sustainability initiatives, executives said on the company’s full-year earnings call.
Chief Executive Officer Zoran Bogdanovic said 2025 marked the company’s fifth year of consistent growth and share gains, including an additional 80 basis points of value share gains in non-alcohol ready-to-drink (NARTD). He highlighted volume momentum led by two strategic priority categories—sparkling and energy—despite a “mixed-market environment.”
2025 financial performance and cash generation
Stamoulis said organic revenue per case increased 5.1%, calling it a “normalization versus previous years,” with pricing the largest driver. He added that category and package mix also contributed, including continued improvement in single-serve mix, which expanded by 130 basis points in 2025 and was up 310 basis points over three years.
On costs and investment, he said gross profit margin improved by 70 basis points, while operating costs rose 10 basis points overall. Operating expenses excluding direct marketing improved by 30 basis points as a percent of revenue, while direct marketing increased by 40 basis points as the company invested in activations including Share a Coke, the Winter Olympics, and a new Finlandia marketing campaign.
Free cash flow totaled €700 million, even as capital expenditures rose €148 million to €828 million. CAPEX represented 7.1% of revenue, within the company’s 6.5%–7.5% target range. The year-end net debt to comparable EBITDA ratio was 0.7x, which management said would rise with the planned acquisition of Coca-Cola Beverages Africa (CCBA), but is expected to remain within its medium-term target range of 1.5x–2.0x post-completion.
The company recommended a dividend per share of €1.20, an increase of 17% from 2024, consistent with its progressive dividend policy and 40%–50% payout ratio target.
Segment and market commentary
In established markets, organic revenue grew 2.3% and volume was flat year over year, reflecting mixed trends. Stamoulis said sparkling volumes were slightly ahead, with high single-digit growth in Coke Zero and mid-single-digit growth in Sprite, while energy rose in the “high teens.” Still beverages declined low single digits, though sports drinks grew mid-single digits. Comparable EBIT in the established segment declined 2.8%, driven primarily by increased investment.
In developing markets, revenue increased 6.1% organically and volume rose 0.8%. The Czech Republic was cited as a standout with mid-single-digit volume growth. Comparable EBIT grew 5.6% with margin in line with the prior year.
Emerging markets delivered the strongest growth: organic revenue increased 13.2% and volume rose 4.4%. Stamoulis highlighted strong performance in Nigeria and Egypt, with volumes up mid-single digits and low teens, respectively, despite external challenges. Comparable EBIT in emerging markets rose 23.2%, helped by organic growth and lapping the prior-year impact of foreign currency remeasurement in Egypt.
On Egypt specifically, Bogdanovic attributed the company’s strong 2025 and fourth-quarter performance to several years of sustained investment in portfolio, capabilities, and route-to-market execution. He cited improvements including enhanced revenue growth management using data insights, changes in wholesaler commercial policies, upskilling sales teams, added capacity including can lines and an additional line in Alexandria, and locally relevant marketing programs focused on music, football, and meals. He also noted energy introductions with Monster and Fury, and called Schweppes in Egypt a particularly significant business for the group.
On established-market volumes, Bogdanovic said the 2025 result provides a “good base” and management expects improvement in 2026. He pointed to Italy ending 2025 with moderately positive volume performance, Ireland’s low single-digit growth, improved second-half performance in Switzerland after retail negotiations were resolved, and Austria remaining softer amid lower consumer sentiment, though the company said it has been gaining share there.
Acquisition of Coca-Cola Beverages Africa and timeline
Bogdanovic reiterated the strategic rationale for acquiring CCBA, describing it as a growth-driven move that materially increases exposure to higher-growth African markets and brings together two leading bottlers. He said the combined group would represent about two-thirds of Africa’s total Coca-Cola system volume and further diversify Coca-Cola HBC’s geographic footprint.
Management said the acquisition is expected to be low single-digit EPS accretive in the first full year after completion. Bogdanovic said shareholder approval was received on January 19, and the company is progressing regulatory filings, antitrust approvals, and preparations for a secondary listing on the Johannesburg Stock Exchange. He said the company remains on track to complete the acquisition by the end of 2026, and that integration planning is underway with CCBA teams, though execution will begin only after approvals.
Asked about medium-term targets, the company said it would provide updated guidance after transaction completion and approvals. Stamoulis added that once the process is completed and the margin base is rebased, the group expects to deliver within its 20–40 basis points margin expansion guidance.
Portfolio priorities: sparkling, energy, coffee, spirits, and snacks
Bogdanovic said sparkling remains the core driver, representing about two-thirds of group revenue, with 2025 organic volume growth of 2.5%. He highlighted low double-digit growth in Coke Zero and high-teen growth in Coca-Cola Zero Zero, mid-single-digit Sprite growth supported by the “spicy meals” occasion, and mid-single-digit adult sparkling growth including Schweppes’ performance in African markets. He said the company plans further rollouts in 2026, including “Flavor of the Quarter” activations and continued expansion of Three Cents.
Energy delivered 28% volume growth in 2025, its 10th consecutive year of double-digit growth, and surpassed €1 billion in revenue for the first time, representing 9% of group revenue. Bogdanovic cited Monster-led growth in established and developing segments and said affordable brands Predator and Fury in Africa grew over 40%, supported by football partnerships and marketing. He said management expects energy to reach a double-digit percentage of revenues “very soon” and plans to add more dedicated coolers.
In coffee, Bogdanovic said the company and Costa Coffee prioritized the out-of-home channel, with out-of-home volumes up 26.5% driven by Costa and Caffè Vergnano. In stills, volumes declined 1% as growth in water and sports drinks was offset by declines in juices and ready-to-drink tea; sports drinks volumes grew low double digits, supported by Powerade innovations and activations, including the launch of Powerade in Romania.
Premium spirits volumes increased 12.2% with double-digit growth across all three segments, led by Finlandia vodka. Bogdanovic attributed momentum to the strategic role of spirits in “mixability” with the non-alcoholic portfolio, increased outlet penetration and distribution, expanded Bacardi coverage from two to 11 countries, and a Finlandia campaign launched in April 2025 that was “positively received,” supporting awareness and share gains.
In snacks, Bogdanovic said 2025 marked the return to full operations at the Bambi plant after a 2024 fire, and noted the October launch of Bambi Snacks in Nigeria, the company’s first entry into Africa for that category.
2026 outlook, investments, and key sensitivities
Stamoulis said the company expects the macroeconomic and geopolitical backdrop to remain challenging with a mixed consumer environment in 2026, but reiterated confidence in the “24/7 portfolio” and capabilities. Guidance calls for organic revenue growth of 6%–7% and organic EBIT growth of 7%–10%.
Discussing what could shift results within the EBIT range, Stamoulis cited potential downside from a worsening geopolitical environment, weaker consumer sentiment, FX pressures, or commodity inflation, while stronger momentum across markets could support the upper end.
The company said it expects a more normalized finance cost environment in 2026, guiding to €25 million–€45 million. Stamoulis attributed 2025’s unusually low finance costs to greater currency stability (including the Nigerian naira) and higher finance income. He said 2026 guidance includes low single-digit million euros of bridge financing costs, but does not include new debt related to the CCBA acquisition, with further guidance to be provided depending on transaction timing.
On pricing and revenue growth management (RGM), Bogdanovic said management expects a more balanced contribution between volume and price/mix in 2026, varying by country. He added that RGM remains central to managing affordability and premiumization across markets, and noted private label shares are relatively small in sparkling and energy, with private label share in sparkling described as declining.
On cost inflation and hedging, Stamoulis said the company expects low single-digit inflation in cost of goods sold, with ongoing pressure in commodities such as aluminum and PET and moderating sugar trends. He said hedging coverage on key commodities was above 55%, with higher coverage in sugar and aluminum.
Management also flagged calendar effects, noting that 2026 includes four additional days in the first quarter (January) and fewer days in the fourth quarter, which could influence the phasing of results.
On sustainability, Bogdanovic said Coca-Cola HBC continued progress in packaging, climate, and water initiatives, including the launch of a collection hub in Nigeria and the expansion of deposit return systems to Austria and Poland. He said recently launched systems in Romania, Hungary, and Austria achieved average return rates of over 80% in 2025. He also noted the Coca-Cola HBC Foundation committed €2.3 million in disaster relief related to wildfires and floods in Europe, and the group announced an additional €5 million for the foundation starting in 2026. The company said more details will be included in its 2025 integrated annual report in March.
About Coca-Cola HBC (LON:CCH)
Coca-Cola HBC is a growth-focused consumer packaged goods business and strategic bottling partner of The Coca-Cola Company. We open up moments that refresh us all, by creating value for our stakeholders and supporting the socio-economic development of the communities in which we operate. With a vision to be the leading 24/7 beverage partner, we offer drinks for all occasions around the clock and work together with our customers to serve 750 million consumers across a broad geographic footprint of 29 countries.
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