Alcohol sales back on Coca-Cola agenda

Coca-Cola Amatil is to move back into beer production and distribution in Australia after outlining strategic deals with global brewers across the Pacific.

The beverage maker says it plans to sell Fiji Bitter as well as Bounty Rum in Australia from December 2013. Under the terms of the sale of its previous beer business to SABMiller, CCA is restrained from selling, distributing or manufacturing beer in Australia until the end of next year.

Six months after CCA sold Pacific Beverages to SABMiller as part of the Foster’s takeover deal, the company’s chief executive Terry Davis told shareholders of deals with Grupo Modelo (distributor of Corona, Carlsberg and Molson Coors) to distribute its products across Pacific nations.

Davis told CCA’s annual general meeting that it would use its distribution network to distribute the companies’ premium beers in Papua New Guinea, Fiji and the Pacific Islands.

“With the impending acquisition of the Fiji beer and spirits business, together with the establishment of beer distribution businesses in the South Pacific, we remain confident about developing the many opportunities we have for our alcoholic beverages business,” Davis said.

It comes after CCA generated a AUD$170 million profit from selling Pacific Beverages late last year, in return for an undertaking to stay out of the Australian beer market for two years.

CCA expects Indonesia and Papua New Guinea to help it generate net profit growth of 4% to 5% for the first half of 2012, despite the difficult operating environment internationally.

The domestic Australian business is expected to grow 1%-2%, with a challenging operating economy and noticeably weaker demand for CCA soft drink and alcohol products in holiday towns on the east coast.

New Zealand’s market is softening but investment in the Indonesian market is expected to grow from $100 million to $120 million through 2012.