Market Recap The brief market pullback in April was quickly forgotten in May, the SPDR S&P 500 ETF Trust (SPY) posted a strong gain of 5.06%, fully erasing its 4.03% loss from the prior month. Vanguard's High Dividend Yield Index Fund ETF (VYM) also posted a good return of 3.03%, not quite enough to cover April's loss of 3.74%, but a solid month nonetheless. My watchlist faired a little better than both ETFs, with a gain of 5.92%. Year-to-date through May, the watchlist is ahead of both SPY and VYM, with a ...

Alongside Australia, as I mentioned just now, volumes in Europe also reflect our strategic portfolio choices, including our transition out of the Capri-Sun brand, which started in March this year. These are the right decisions, as we continue to be more choiceful on where we want to play for the long-term to ensure we continue to grow our business both profitably and sustainably. Excluding the impact of these exits, underlying volume for Europe was up on a 2-year basis of around 4.1% versus 2022. living pre ...

Lemon_tmQuality Stocks The SPDR S&P 500 Trust ETF (SPY) posted a 3.27% return in March, finishing Quarter 1 with a double digit gain. Vanguard's Dividend Appreciation Index Fund ETF Shares (VIG) locked in a lower gain of 2.37% last month. My watchlist underperformed both, posting a very weak return of 0.50%. Frankly it's been struggling to get off the ground this year. After two strong months of outperformance to cap off 2023 the watchlist is experiencing a pullback in 2024. As we all know, some months ...

Financial Reporting - CCEP filed its 2023 Integrated Report and Form 20-F with the SEC on 15 March 2024, including audited results for the year ended 31 December 2023[1] - The unaudited fourth-quarter and full-year results for the period ended 31 December 2023 were released on 23 February 2024[1] - The Integrated Report and Form 20-F will be available online and printed copies will be sent to shareholders who requested them around 10 April 2024[5] Company Operations - CCEP serves 600 million consumers and supports over 2 million customers across 31 countries[6] - CCEP is listed on multiple exchanges, including Euronext Amsterdam, NASDAQ, London Stock Exchange, and Spanish Stock Exchanges[6]

Strategic Report [Who We Are](index=6&type=section&id=Who%20we%20are) Coca-Cola Europacific Partners (CCEP) is a leading global consumer goods company whose success is built on great brands, people, and sustainable execution - CCEP is one of the world's leading consumer goods companies, making, moving, and selling some of the world's most loved drinks[12](index=12&type=chunk) - The company's success is built on three pillars: **great brands, great people, and great execution**, done sustainably[10](index=10&type=chunk) [Performance Indicators](index=7&type=section&id=Performance%20indicators) CCEP achieved strong 2023 financial performance with reported revenue up 5.5% and operating profit up 12.0%, alongside progress on sustainability targets Financial Performance Highlights (2023 vs 2022) | Metric | 2023 | 2022 | Change (Reported) | Change (Comparable & FX Neutral) | |:---|:---|:---|:---|:---| | Reported Revenue (€m) | 14,553 | 13,529 | +5.5% | +8.0% | | Reported Operating Profit (€m) | 1,842 (Eur) / 497 (API) | 1,529 (Eur) / 500 (API) | +12.0% | +13.5% | | Volume (Comparable) | -0.5% | N/A | N/A | N/A | | Revenue per Unit Case (Comparable & FX Neutral) | +8.5% | N/A | N/A | N/A | - Volume remained resilient despite macroeconomic impacts on consumer spend and strategic SKU rationalisation, with **strong underlying volume performance**[13](index=13&type=chunk) Sustainability Target Progress (2023) | Sustainability Target | 2023 Progress | Target | |:---|:---|:---| | Group GHG Emissions Reduction (vs. 2019) | 16.7% | 30% by 2030 | | Europe Sugar Reduction (vs. 2019) | 4.9% | 10% by 2025 | | Australia Sugar Reduction (vs. 2015) | 14.9% | 25% by 2025 | | New Zealand Sugar Reduction (vs. 2015) | 15.9% | 20% by 2025 | | Indonesia Sugar Reduction (vs. 2015) | 36.2% | 35% by 2025 | [Our Portfolio](index=9&type=section&id=Our%20portfolio) CCEP offers a diverse beverage portfolio, expanding into alcohol and coffee, and reinforced its global position through the acquisition of CCBPI Brand Category Volume Share (2023) | Brand Category | 2023 Volume Share | |:---|:---| | Coca-Cola | 59.0% | | Flavours, mixers and energy | 26.0% | | RTD tea, coffee, juices and other | 7.5% | | Hydration | 7.5% | - In 2023, CCEP launched new products including **Coca-Cola Y3000 Zero Sugar** (co-created with AI) and various Monster Energy flavors like Monster Zero Sugar, Monster Juiced Aussie Lemonade, Monster Ultra Rosa, and Monster Ultra Peachy Keen[26](index=26&type=chunk)[31](index=31&type=chunk) - The acquisition of Coca-Cola Beverages Philippines, Inc (CCBPI) in a joint venture with Aboitiz Equity Ventures Inc (AEV) positions CCEP as the **world's largest Coca-Cola bottler by revenue**, enhancing profitability and growth prospects[34](index=34&type=chunk) [Our Operations](index=12&type=section&id=Our%20operations) CCEP leverages local market knowledge across its European and API operations to deliver brands and execute sustainably, with key revenue from Iberia, Great Britain, and Germany - Remaining close to customers, communities, and stakeholders provides unique market knowledge, enabling delivery of great brands and execution sustainably[35](index=35&type=chunk) Operations Overview by Region | Region | Revenue by Geography (%) | Total Employees | Production Facilities | |:---|:---|:---|:---| | Iberia | 18.5% | 3,964 | 11 | | Germany | 16.5% | 6,473 | 16 | | Great Britain | 17.5% | 3,487 | 5 | | France and Monaco | 12.5% | 2,623 | 5 | | Belgium and Luxembourg | 6.0% | 2,165 | 3 | | Netherlands | 4.0% | 803 | 1 | | Norway | 2.0% | 568 | 1 | | Sweden | 2.0% | 725 | 1 | | Iceland | 0.5% | 166 | 2 | | Bulgaria | N/A | 1,196 | N/A | [Our Business Model](index=13&type=section&id=Our%20business%20model) CCEP's business model involves manufacturing and distributing beverages under franchise agreements, emphasizing sustainable practices to create stakeholder value - CCEP partners with TCCC and other franchisors, purchasing concentrates and syrups to make, sell, and distribute packaged beverages[43](index=43&type=chunk) - The business model focuses on creating value and driving sustainable returns for customers, people, shareholders, suppliers, franchisors, communities, and consumers[42](index=42&type=chunk) - A key aspect is leading towards a circular economy for packaging, encouraging collection, recycling, and reuse of materials, with **99.1% of bottles and cans being recyclable**[43](index=43&type=chunk) [Chairman and CEO In Conversation](index=14&type=section&id=Chairman%20and%20CEO%20In%20conversation) The Chairman and CEO highlighted 2023's strong momentum, driven by top-line growth, strategic acquisitions, and a core focus on sustainability - 2023 saw **strong top-line growth**, led by price and mix, with resilient volumes despite inflationary pressures, driving solid gains in revenue per unit case[49](index=49&type=chunk) - Key strategic progress included portfolio expansion with new products like **Jack Daniel's & Coca-Cola** and **Monster Zero Sugar**, and geographical diversification through the acquisition of CCBPI[51](index=51&type=chunk) - CCEP delivered a **record dividend, up almost 10% year-on-year**, and achieved impressive total shareholder return (TSR), entering the Nasdaq-100[52](index=52&type=chunk) - Sustainability commitments are progressing, with short- and long-term emissions reduction targets and increased recycled content in packaging, validated by SBTi[54](index=54&type=chunk) [Our Market Drivers](index=18&type=section&id=Our%20market%20drivers) CCEP's business is shaped by consumer trends, macroeconomic factors, and a growing focus on sustainability, which it addresses through strategic adaptation - Consumer trends show increasing demand for choice, healthier alternatives (low/no calorie), value, convenience, and online shopping[63](index=63&type=chunk) - Macroeconomic factors like geopolitical volatility and high inflation impacted business in 2023, leading to dynamic pricing strategies and a focus on productivity[64](index=64&type=chunk) - Sustainability is a growing focus, with increasing government and consumer pressure on climate change and environmental regulations, driving CCEP to create new sustainability initiatives and partnerships[67](index=67&type=chunk) [Our Strategy](index=19&type=section&id=Our%20strategy) CCEP's strategy aims to outperform the market through great brands, people, and execution, with the 'This is Forward' sustainability plan at its core - CCEP's core strategy is '**great brands, great people, great execution, done sustainably**,' aiming to outperform the market and create value[70](index=70&type=chunk) - The 'This is Forward' sustainability action plan is integral, with targets including reducing **GHG emissions by 30% by 2030 (Net Zero by 2040)**, achieving 100% recyclable primary packaging by 2025, and replenishing 100% of water used in beverages[70](index=70&type=chunk)[73](index=73&type=chunk)[75](index=75&type=chunk) - The strategy involves expanding the portfolio into categories like coffee and alcohol, reducing sugar in drinks, fostering an inclusive workplace, and ensuring sustainable sourcing[71](index=71&type=chunk)[72](index=72&type=chunk)[75](index=75&type=chunk) [This is Forward - Our Sustainability Action Plan](index=20&type=section&id=This%20is%20Forward%20-%20our%20sustainability%20action%20plan) The 'This is Forward' plan outlines CCEP's headline commitments across six key pillars to drive sustainable progress and address social and environmental challenges 'This is Forward' Headline Commitments | Pillar | Commitment | Target | |:---|:---|:---| | Drinks | Sugar reduction | 10% reduction by 2025 (Europe), 20-35% reduction by 2025 (API) | | Drinks | Low or no calorie | Over 50% of sales from low/no calorie drinks by 2025 | | Society | Gender diversity management | 45% of management positions to be held by women by 2030 | | Society | Disabilities | 10% of workforce represented by people with disabilities by 2030 | | Climate | GHG emissions reduction | Reduce absolute GHG emissions (Scope 1, 2, 3) by 30% by 2030 | | Climate | Net Zero | Net Zero GHG emissions (Scope 1, 2, 3) by 2040 | | Packaging | Design | 100% of primary packaging to be recyclable by 2025 | | Packaging | Recycled plastic | 50% recycled plastic in PET bottles by 2023 (Europe) / 2025 (API) | | Water | Water efficiency | 10% water use ratio reduction by 2030 | | Water | Replenish | Replenish 100% of water used in beverages | [Great Brands](index=21&type=section&id=Great%20brands) CCEP focuses on its diverse brand portfolio by reducing sugar, promoting transparency, and expanding into new categories like alcohol-ready-to-drink (ARTD) - CCEP is committed to reducing sugar across its portfolio by reformulating recipes and introducing new low and no-calorie options, aligning with WHO recommendations[79](index=79&type=chunk) Volume Share by Category | Category | 2023 % of total volume | 2022 % of total volume | |:---|:---|:---| | Sparkling | 85.0% | 84.5% | | Coca-Cola | 59.0% | 58.5% | | Flavours, mixers and energy | 26.0% | 26.0% | | Stills | 15.0% | 15.5% | | RTD tea, coffee, juices and others | 7.5% | 7.5% | | Hydration | 7.5% | 8.0% | | Total | 100.0% | 100.0% | - In 2023, CCEP successfully launched **Jack Daniel's & Coca-Cola ARTD** in Great Britain, the Netherlands, and Spain, meeting consumer demand in the growing ARTD category[95](index=95&type=chunk) - Progress on sugar reduction targets: **Europe (4.9% reduction vs 2019)**, **Australia (14.9% vs 2015)**, **New Zealand (15.9% vs 2015)**, and **Indonesia (36.2% vs 2015)**[85](index=85&type=chunk) [Great People](index=25&type=section&id=Great%20people) CCEP fosters an inclusive, diverse, and safe work environment through initiatives focused on wellbeing, gender diversity, human rights, and community support - CCEP's ambition is to create an open, inclusive, and respectful workplace where people are safe, can grow, and make a difference, supporting economic mobility and building resilience in communities[98](index=98&type=chunk)[99](index=99&type=chunk)[100](index=100&type=chunk) People & Community Performance Metrics | Metric | 2023 | 2022 | Target | |:---|:---|:---|:---| | Women in Management Positions | 38.4% | 37.2% | 45% by 2030 | | Women in Total Workforce | 25.1% | 23.8% | A third by 2030 | | Workforce with Disabilities | 12.6% | N/A | 10% by 2030 | | Total Incident Rate (TIR) | 0.84 | 0.87 | <1 by 2025 | | Total Volunteering Hours | 32,500 | 28,500 | N/A | - In 2023, **over 1,250 Wellbeing First Aiders were trained**, and a new Wellbeing Hub was launched in Europe to support mental health[114](index=114&type=chunk)[115](index=115&type=chunk) - Human rights risk assessments were conducted in Germany and Norway, identifying low risk within operations but remaining risk in the supplier base[133](index=133&type=chunk) [Great Execution](index=33&type=section&id=Great%20execution) CCEP delivers great execution through strong commercial strategies and sustainable procurement, aiming for 100% sustainable sourcing and supplier compliance - CCEP aims to be a market leader and value creator for customers, known for agility, flexibility, and world-class execution, supported by digital tools and data analytics[150](index=150&type=chunk) Sustainable Sourcing Metrics | Metric | 2023 | 2022 | Target | |:---|:---|:---|:---| | Supplier Spend Covered by SGPs | 97.9% | 97.5% | 100% | | Sugar Sourced in Compliance with PSA | 99.4% | 97.6% | 100% | | Pulp and Paper Sourced in Compliance with PSA | 99.8% | 99.2% | 100% | - In 2023, CCEP spent **~€7 billion with over 16,000 suppliers**, with 84% of this spend with suppliers in its countries of operation[155](index=155&type=chunk) - **31% of carbon strategic suppliers** (Europe 50%, API 16%) had SBTi validated targets in 2023, with a further 48% committed to setting them, as suppliers are responsible for over 80% of Scope 3 GHG emissions[184](index=184&type=chunk)[185](index=185&type=chunk) [Done Sustainably](index=41&type=section&id=Done%20sustainably) CCEP is committed to decarbonization, reducing packaging impact, and water stewardship, with significant investments planned to achieve its sustainability targets - CCEP's climate targets, validated by SBTi, include reducing absolute GHG emissions (Scope 1, 2, and 3) by **30% by 2030** and achieving **Net Zero by 2040**[197](index=197&type=chunk) Sustainability Performance Highlights (2023) | Metric | 2023 Progress | Target | |:---|:---|:---| | Absolute GHG Emissions Reduction (vs. 2019) | 16.7% | 30% by 2030 | | Renewable Electricity Consumption | 78.0% | 100% by 2030 | | Primary Packaging Recyclability | 99.1% | 100% by 2025 | | Recycled Plastic (rPET) in PET bottles | 54.6% | 50% by 2025 | | Packaging Collected for Recycling | 73.2% | 100% by 2030 | | Water Use Ratio Reduction (vs. 2019) | 4.9% | 10% by 2030 | | Water Replenished (as % of total sales volumes) | 98.7% | 100% by 2030 | - CCEP plans to invest approximately **€450 million between 2023 and 2025** in energy, logistics, and carbon reduction technologies to support its decarbonisation plan[205](index=205&type=chunk) - In 2023, **14 production facilities were certified as carbon neutral** under PAS 2060, and 98.9% of electricity purchased in Europe came from renewable sources[212](index=212&type=chunk)[215](index=215&type=chunk) [Task Force on Climate-related Financial Disclosures (TCFD)](index=53&type=section&id=Task%20Force%20on%20Climate-related%20Financial%20Disclosures%20%28TCFD%29) CCEP transparently discloses climate-related risks and opportunities through the TCFD framework, integrating climate considerations into its governance and strategy - CCEP's climate disclosures align with TCFD's four pillars and 11 recommendations, integrating science-based climate scenario modeling with internal and insurance data[267](index=267&type=chunk)[268](index=268&type=chunk)[281](index=281&type=chunk) - The Board, supported by the ESG and Audit Committees, oversees climate-related risks and opportunities, with climate issues considered in Board decision-making and executive remuneration[270](index=270&type=chunk)[272](index=272&type=chunk) - Scenario analysis identified physical risks (e.g, extreme weather, water scarcity, agricultural disruption) and transition risks (e.g, carbon pricing, consumer shifts, technology changes, reputation)[305](index=305&type=chunk)[311](index=311&type=chunk) - CCEP has allocated over €300 million (2020-2022) and plans **€450 million (2023-2025)** for emissions reduction initiatives, including rPET investment, to mitigate risks and capitalize on opportunities[289](index=289&type=chunk)[290](index=290&type=chunk) Key Climate Targets | Climate Target | Status/Progress | |:---|:---| | Net Zero GHG emissions (Scope 1, 2, 3) | By 2040 (SBTi validated) | | Reduce absolute GHG emissions (Scope 1, 2, 3) | 30% by 2030 (vs. 2019, SBTi validated) | | Use 100% renewable electricity | Across all markets by 2030 | | Carbon strategic suppliers to set SBTs | 100% by 2023 (Europe) / 2025 (API) | | Carbon strategic suppliers to use 100% renewable electricity | 100% by 2025 (Europe) / 2030 (API) | [Our Stakeholders](index=66&type=section&id=Our%20stakeholders) CCEP engages with its diverse stakeholders through various channels to understand their needs, create mutual value, and inform its corporate strategy - CCEP's key stakeholders include its people, shareholders, franchisors, consumers, customers, suppliers, and communities, all integral to its business model and success[333](index=333&type=chunk) - Engagement methods include annual surveys, Townhalls, Speak Up channels for employees; AGMs, roadshows for shareholders; regular contact and top-to-top meetings with franchisors; consumer insights and social media interaction; and daily sales team visits for customers[325](index=325&type=chunk)[328](index=328&type=chunk)[330](index=330&type=chunk) - Value creation involves providing employment, improving local environments, investing in community causes, driving sales for franchisors, offering diverse and high-quality products to consumers, and fostering long-term partnerships with suppliers[328](index=328&type=chunk)[330](index=330&type=chunk)[331](index=331&type=chunk) [Section 172(1) Statement from the Directors](index=70&type=section&id=Section%20172%281%29%20statement%20from%20the%20Directors) The Directors confirm acting in good faith to promote CCEP's long-term success by considering stakeholder interests in key 2023 decisions - Directors considered the long-term consequences of decisions, the interests of people and key stakeholders, and the impact of operations on communities and the environment[332](index=332&type=chunk)[333](index=333&type=chunk)[334](index=334&type=chunk) - The acquisition of CCBPI (completed Feb 2024) was a principal decision, expected to be **EPS accretive**, diversify the workforce, and leverage best practices, reinforcing CCEP's position as the world's largest Coca-Cola bottler by revenue[337](index=337&type=chunk)[339](index=339&type=chunk)[341](index=341&type=chunk) - Strategic portfolio choices, like the launch of **Jack Daniel's & Coca-Cola ARTD**, were approved to expand CCEP's presence in emerging categories and create incremental value for shareholders and franchisors[346](index=346&type=chunk) [Principal Risks](index=73&type=section&id=Principal%20risks) CCEP manages principal risks including business disruption, packaging waste, regulatory changes, and climate change through its Enterprise Risk Management framework - CCEP's ERM framework identifies and manages principal risks, with oversight from the Board and Audit Committee, and risk owners at the ELT level[348](index=348&type=chunk)[350](index=350&type=chunk) Principal Risk Overview | Principal Risk | Description | Causal Factors (Themes) | Consequence (Potential Impact) | |:---|:---|:---|:---| | Business disruption | Prolonged, large-scale natural/man-made disruptive events | Cyber attack, IT/operational technology system failure, pandemics, extreme weather, civil unrest | Disruption to supply chains/operations, safety of people, brand/reputation damage, financial impact | | Packaging | Packaging waste and plastic pollution, single-use plastic | Stakeholder concern, environmental impacts, litter | Brand/reputation damage, financial impact from taxes, regulatory/compliance impacts, increased activism/litigation | | Legal, regulatory and tax | New or changing legal, regulatory or tax environment | Increased regulation, use of regulated ingredients, packaging regulation, marketing restrictions, new technology regulation | Financial impact from taxes, stricter controls, punitive action, increased compliance costs, brand/reputation damage | | Cyber and IT resilience | Protection of information systems and data | External attackers, dependency on third parties, internal misuse, security/maintenance of IT infrastructure | Financial impact from disruption/fines, safety of employees/customers, brand/reputation damage | | Economic and political conditions | Volatile and challenging macroeconomic and geopolitical conditions | Low economic growth/recession, high currency/commodity price volatility, high inflation, political instability | Financial impact from reduced demand/increased costs, supply chain disruption | | Market | Maintaining relationships with customers/consumers | New distribution channels, changing habits, competitive landscape, legislative/regulatory changes | Financial impact from reduced demand, decreasing margins/market share, inability to meet objectives, brand/reputation damage | | Climate change and water | Risks/opportunities associated with climate change and water scarcity | GHG emissions, production facilities, CDE, transportation, packaging, ingredients, water scarcity, regulatory initiatives, changing preferences | Brand/reputation damage, financial impacts from carbon taxes/transition costs, regulatory/compliance impacts, water supply disruption | | Changes in customer and consumer buying trends and category perception | Adapting to changes in customer/consumer preferences and behavior | Legislative changes, external marketing campaigns, guidelines on sugar/additives, media scrutiny, viability of alternatives | Financial impacts from sales decline, increased regulatory scrutiny, marketing/labelling restrictions, brand/reputation damage | | Business transformation, integration and digital capability | Execution of strategic and continuous improvement initiatives | Digital transformation, supply chain improvements, relationships with partners/franchisors, ineffective coordination, change management failure | Damage to brand/reputation, financial impacts from not realizing value creation, industrial action | | People and wellbeing | Identification, attraction, development, retention of talent; wellbeing of people | Job design/working conditions, reward/recognition, misconduct by third parties (human rights) | Damage to brand/reputation, financial impacts from decline in engagement/productivity, industrial action, punitive action/litigation | | Relationships with TCCC and other franchisors | Misaligned incentives or strategy with TCCC/other franchisors | Lack of effective engagement/communication/discussion | Damage to brand/reputation, financial impacts from adverse actions by franchisors | | Product quality | Ensuring products are safe for consumption and meet quality requirements | Failure in food safety/quality/defence/fraud processes | Consumer health/safety concerns, reputation damage, regulatory/legal consequences, financial losses | [Viability Statement](index=84&type=section&id=Viability%20statement) The Directors assessed CCEP's viability over a three-year cycle, concluding the company is well-positioned to manage risks and remain viable - The Directors assessed CCEP's prospects over a three-year planning cycle (2023-2025), considering key financial metrics and principal risks[382](index=382&type=chunk)[383](index=383&type=chunk) - Stress testing incorporated potential downside impacts from legal/regulatory intervention (e.g, plastic packaging), cyber attacks, economic/political uncertainty, and climate change/water scarcity[384](index=384&type=chunk)[385](index=385&type=chunk) - **Conclusion**: CCEP is well-positioned to manage risks and maintain solvency and liquidity, supported by its strong financial position, stable cash generation, and access to liquidity[384](index=384&type=chunk) [Non-Financial and Sustainability Information Statement](index=85&type=section&id=Non-financial%20and%20sustainability%20information%20statement) This statement confirms the Integrated Report fulfills statutory non-financial reporting requirements and directs readers to relevant sections for detailed information - The Integrated Report combines financial and non-financial reporting, fulfilling sections 414CA and 414CB of the Companies Act 2006[386](index=386&type=chunk) Index of Non-Financial Information | Information Category | Page(s) | |:---|:---| | Environmental matters | Forward on climate, packaging, water, drinks, TCFD | | Employee matters | Forward on people, Our stakeholders | | Social matters | Forward on society | | Human rights | Forward on society | | Anti-corruption and anti-bribery matters | Forward on society | | Our business model | Our business model | | Risk and principal risks | Principal risks, Risk factors | | Non-financial performance indicators | Sustainability reporting methodology | | Climate-related financial information | Key performance data summary, Sustainability reporting methodology, TCFD, Principal risks | [Business and Financial Review](index=86&type=section&id=Business%20and%20financial%20review) CCEP delivered strong 2023 financial results with reported revenue up 5.5% to €18.3 billion, driven by effective pricing and resilient volumes - CCEP is a leading consumer goods group in Western Europe and Asia Pacific, serving nearly 600 million consumers and over two million customers across 31 countries[389](index=389&type=chunk) Key Financial Metrics (2023 vs 2022) | Metric | 2023 (Reported) | 2023 (Comparable & FX Neutral) | 2022 (Reported) | 2022 (Comparable & FX Neutral) | YoY Change (Reported) | YoY Change (Comparable & FX Neutral) | |:---|:---|:---|:---|:---|:---|:---| | Revenue (€m) | 18,302 | 18,302 | 17,320 | 17,320 | +5.5% | +8.0% | | Cost of Sales (€m) | 11,582 | 11,825 | 11,096 | 11,088 | +4.5% | +6.5% | | Operating Expenses (€m) | 4,488 | 4,353 | 4,234 | 4,087 | +6.0% | +8.5% | | Operating Profit (€m) | 2,339 | 2,373 | 2,086 | 2,138 | +12.0% | +13.5% | | Profit After Taxes (€m) | 1,669 | 1,701 | 1,521 | 1,561 | +9.5% | +11.5% | | Diluted EPS (€) | 3.63 | 3.71 | 3.29 | 3.39 | +10.5% | +12.0% | - **Revenue per unit case increased by 8.5%** (comparable and FX neutral), while volume declined by 0.5% (comparable), showing strong pricing and mix management[400](index=400&type=chunk) Cash Flow and Debt Metrics (2023 vs 2022) | Metric | 2023 | 2022 | YoY Change | |:---|:---|:---|:---| | Comparable Free Cash Flow (€m) | 1,734 | 1,805 | -3.9% | | Net Debt to Comparable EBITDA | 3.0 | 3.5 | -0.5 | | Dividends Paid (€m) | 841 | 763 | +10.2% | - The reported effective tax rate increased to **24% in 2023** (from 22% in 2022), largely due to the increase in the UK statutory tax rate[418](index=418&type=chunk) [Revenue](index=88&type=section&id=Revenue) Total revenue reached €18.3 billion in 2023, an 8.0% increase on a comparable and FX neutral basis, driven by an 8.5% rise in revenue per unit case Revenue by Region (2023) | Region | 2023 Revenue (€m) | Reported % Change | FX Neutral % Change | |:---|:---|:---|:---| | Europe | 14,553 | 7.5% | 8.5% | | API | 3,749 | (1.0%) | 5.5% | | Total CCEP | 18,302 | 5.5% | 8.0% | - **Revenue per unit case increased by 8.5%** on a comparable and FX neutral basis, driven by positive headline price and promotional optimisation[400](index=400&type=chunk) - Europe's volume grew by 0.5% due to strong in-market execution and consumer demand, while API's volume decreased by 5.0% due to softer consumer spending in Indonesia and SKU rationalisation[402](index=402&type=chunk) [Cost of Sales](index=90&type=section&id=Cost%20of%20sales) Cost of sales rose 6.5% on a comparable and FX neutral basis, driven by inflationary pressures on raw materials like sugar and aluminum Cost of Sales Analysis (2023 vs 2022) | Metric | 2023 (€m) | 2022 (€m) | Reported % Change | Comparable & FX Neutral % Change | |:---|:---|:---|:---|:---| | Reported Cost of Sales | 11,582 | 11,096 | 4.5% | N/A | | Comparable & FX Neutral Cost of Sales | 11,825 | 11,088 | N/A | 6.5% | | Cost of Sales per Unit Case (€) | 3.61 | 3.36 | N/A | 7.5% | - Increased cost of sales was driven by **inflationary pressures on raw materials** (sugar, aluminum) and concentrate costs, despite increased use of recycled PET[413](index=413&type=chunk) [Operating Expenses](index=90&type=section&id=Operating%20expenses) Operating expenses increased 8.5% on a comparable and FX neutral basis due to inflation, increased marketing investment, and higher volumes Operating Expenses Analysis (2023 vs 2022) | Metric | 2023 (€m) | 2022 (€m) | Reported % Change | Comparable & FX Neutral % Change | |:---|:---|:---|:---|:---| | Reported Operating Expenses | 4,488 | 4,234 | 6.0% | N/A | | Comparable & FX Neutral Operating Expenses | 4,353 | 4,087 | N/A | 8.5% | - Operating expenses increased due to **inflationary pressures on labor and haulage**, and optimized investment in trade marketing expenses[414](index=414&type=chunk)[415](index=415&type=chunk) - **Restructuring charges of €94 million** were recognized in 2023, primarily for severance costs related to transformation initiatives[416](index=416&type=chunk) [Effective Tax Rate](index=91&type=section&id=Effective%20tax%20rate) The reported effective tax rate increased to 24% in 2023, primarily due to the rise in the UK statutory tax rate Effective Tax Rate (2023 vs 2022) | Metric | 2023 | 2022 | |:---|:---|:---| | Reported Effective Tax Rate | 24% | 22% | | Comparable Effective Tax Rate | 24% | 22% | - The increase in the reported effective tax rate was largely due to the **increase in the UK statutory tax rate** to a weighted average of 23.5% and the review of uncertain tax positions[418](index=418&type=chunk) [Return on Invested Capital (ROIC)](index=91&type=section&id=Return%20on%20invested%20capital%20%28ROIC%29) ROIC improved in 2023, reflecting strong operating profit growth and a continued focus on capital efficiency ROIC Performance (2023 vs 2022) | Metric | 2023 | 2022 | |:---|:---|:---| | Reported ROIC | 9.5% | 8.4% | | Comparable ROIC | 10.3% | 9.1% | - The increase in ROIC reflects **strong operating profit growth** and continued focus on capital efficiency[419](index=419&type=chunk) [Liquidity and Capital Resources](index=92&type=section&id=Liquidity%20and%20capital%20resources) CCEP maintains strong liquidity through operating cash flow and an undrawn €1.80 billion credit facility, while effectively managing its debt profile - CCEP has a **€1.80 billion multi-currency credit facility**, undrawn as of December 31, 2023, ensuring strong liquidity[900](index=900&type=chunk) Key Liquidity Metrics (2023 vs 2022) | Metric | 2023 (€m) | 2022 (€m) | |:---|:---|:---| | Net Cash Flows from Operating Activities | 2,806 | 2,932 | | Comparable Free Cash Flow | 1,734 | 1,805 | | Total Borrowings (Decrease) | (511) | N/A | | Net Debt to Comparable EBITDA | 3.0 | 3.5 | - In 2023, CCEP repaid **US$850 million 0.5% Notes**, US$50 million 4.34% Notes, and **€350 million 2.625% Notes**, while issuing **€700 million 3.875% Notes** for the CCBPI acquisition[424](index=424&type=chunk) [Supplementary Financial Information - Items Impacting Comparability](index=95&type=section&id=Supplementary%20financial%20information%20-%20Items%20impacting%20comparability%20-%20Reported%20to%20comparable) This section reconciles reported to comparable financial results, detailing adjustments for items like restructuring charges and acquisition costs Reconciliation of Reported to Comparable Results (2023) | Item Impacting Comparability (2023) | Operating Profit (€m) | Profit After Taxes (€m) | Diluted EPS (€) | |:---|:---|:---|:---| | As reported | 2,339 | 1,669 | 3.63 | | Restructuring charges | 94 | 79 | 0.18 | | Acquisition and integration related costs | 17 | 14 | 0.03 | | European flooding | (9) | (7) | (0.02) | | Coal royalties | (18) | (12) | (0.03) | | Property sale | (54) | (38) | (0.08) | | Litigation | 17 | 12 | 0.03 | | Accelerated amortisation | 27 | 19 | 0.04 | | Sale of sub-strata and associated mineral rights | (35) | (35) | (0.07) | | Comparable | 2,373 | 1,701 | 3.71 | Operating Profit by Segment (Comparable & FX Neutral) | Operating Profit by Segment (Comparable & FX Neutral) | 2023 (€m) | 2022 (€m) | % Change | |:---|:---|:---|:---| | Europe | 1,907 | 1,670 | 14.0% | | API | 466 | 468 | (0.5%) | Governance and Directors' Report [Chairman's Introduction](index=97&type=section&id=Chairman's%20introduction) The Chairman highlights the Board's 2023 activities, focusing on strategic oversight, ESG commitments, and the successful acquisition of CCBPI - The Board provided strategic oversight and guidance to mitigate impacts from commodity prices and inflationary pressures in a challenging macroeconomic environment[442](index=442&type=chunk) - A key priority was the safety and wellbeing of people, with **over 1,250 Wellbeing First Aiders trained**[444](index=444&type=chunk) - The acquisition of CCBPI solidified CCEP's position as the **world's largest Coca-Cola bottler by revenue**[441](index=441&type=chunk) - The Board continued to monitor and progress ESG commitments, including approving a new Group water use ratio reduction target[445](index=445&type=chunk) [Board of Directors](index=98&type=section&id=Board%20of%20Directors) CCEP's diverse and experienced Board of Directors comprises 17 members with expertise across strategy, marketing, sustainability, and digital transformation - The Board of Directors consists of 17 members, bringing diverse experience and knowledge for long-term success[447](index=447&type=chunk) Board Gender Diversity | Gender | Number of Directors | Percentage | |:---|:---|:---| | Women | 6 | 35.3% | | Men | 11 | 64.7% | - Directors possess expertise in areas such as strategy, marketing, customer relations, people, sustainability, bottling, and digital transformation[448](index=448&type=chunk) [Directors' Biographies](index=100&type=section&id=Directors'%20biographies) The Board comprises a Chairman, CEO, and 15 Non-executive Directors with extensive experience in FMCG, finance, and international markets - The Board comprises a Chairman, CEO, and 15 Non-executive Directors, with diverse backgrounds and extensive experience in FMCG, international business, finance, and sustainability[450](index=450&type=chunk) - **Sol Daurella (Chairman)** has over 70 years of experience in the Coca-Cola system, and **Damian Gammell (CEO)** has over 25 years in the NARTD industry, focusing on strategy, people development, and sustainability[452](index=452&type=chunk)[453](index=453&type=chunk) - New appointments like **Guillaume Bacuvier (Jan 2024)** bring expertise in consumer behaviors, strategy, and marketing effectiveness across Europe and APAC[477](index=477&type=chunk)[479](index=479&type=chunk) [Senior Management](index=105&type=section&id=Senior%20management) CCEP's Executive Leadership Team, led by the CEO, comprises experienced functional and regional leaders responsible for driving business strategy and operational excellence - The Executive Leadership Team (ELT) includes the CEO and senior direct reports, responsible for driving business strategy and operational excellence[481](index=481&type=chunk) - Key ELT members include **Nik Jhangiani (CFO)** with 30+ years in finance, **Clare Wardle (General Counsel)** leading legal, risk, and compliance, and **José Antonio Echeverria (Chief Customer Service & Supply Chain Officer)** focused on customer value and supply chain[482](index=482&type=chunk)[483](index=483&type=chunk)[484](index=484&type=chunk) - **Véronique Vuillod (Chief People and Culture Officer)** advocates for human-centered workplaces and promotes inclusion and diversity[486](index=486&type=chunk) [Corporate Governance Report](index=108&type=section&id=Corporate%20governance%20report) CCEP's governance framework aligns with the UK Corporate Governance Code, with the Board providing leadership and oversight through its five committees - CCEP's governance framework is based on its Articles of Association and Shareholders' Agreement, complying with the 2018 UK Corporate Governance Code on a 'comply or explain' basis[492](index=492&type=chunk)[493](index=493&type=chunk) - The Board oversees strategy, risk, internal controls, and governance, with delegated authority to five committees: **Audit, ESG, Nomination, Remuneration, and Affiliated Transaction**[491](index=491&type=chunk)[504](index=504&type=chunk) - Key Board discussions in 2023 covered market uncertainty, people strategy, sustainability initiatives, commercial expansion (e.g, CCBPI acquisition, ARTD category), and financial performance[510](index=510&type=chunk) - An internal Board evaluation in 2023 confirmed **overall effectiveness**, with high ratings for culture and relationship with senior management, but identified a need for further focus on disruptive technologies[531](index=531&type=chunk)[532](index=532&type=chunk) [Nomination Committee](index=118&type=section&id=Nomination%20Committee) The Nomination Committee oversees Board composition, diversity, and succession planning, focusing on inclusivity and aligning with regulatory requirements - The Nomination Committee oversees CCEP's culture, people, Board appointments, re-elections, and succession planning[550](index=550&type=chunk) - In 2023, the Committee monitored progress on inclusivity, noting CCEP's aim for **45% women in management roles by 2030** and achieving 10% of the workforce with self-declared disabilities[540](index=540&type=chunk)[541](index=541&type=chunk) - The Board Diversity policy was updated to emphasize diversity across age, gender, ethnicity, sexual orientation, disability, and professional background[547](index=547&type=chunk) Board Diversity Metrics (as of 31 Dec 2023) | Board Diversity Metric (as of 31 Dec 2023) | Number | Percentage | |:---|:---|:---| | Total Directors | 17 | N/A | | Female Directors | 6 | 35.3% | | Male Directors | 11 | 64.7% | | White British or other White | 16 | 94% | | Other ethnic group | 0 | 0% | | Not specified/prefer not to say | 1 | 6% | [Audit Committee](index=122&type=section&id=Audit%20Committee) The Audit Committee oversees financial reporting integrity, internal controls, and risk management, with key 2023 activities including the CCBPI acquisition and auditor re-tender - The Audit Committee oversees financial reporting integrity, internal controls, risk management, and the external auditor relationship, comprising only Independent Non-executive Directors[570](index=570&type=chunk)[571](index=571&type=chunk)[572](index=572&type=chunk)[573](index=573&type=chunk)[574](index=574&type=chunk) - In 2023, the Committee reviewed the financing and hedging strategy for the **CCBPI acquisition** and addressed SEC correspondence regarding the accounting for TCCC bottling rights as indefinite-lived intangible assets[562](index=562&type=chunk)[563](index=563&type=chunk)[579](index=579&type=chunk) - The Committee initiated the **mandatory 2025 external auditor re-tender process** and supported the transition to EY as the assurance provider for FY23 sustainability metrics[564](index=564&type=chunk)[565](index=565&type=chunk)[587](index=587&type=chunk) - Key financial reporting matters considered included TCCC bottling rights (**intangible assets of €11.8 billion**), deductions from revenue (€5.4 billion in customer marketing costs), tax accounting (€534 million expense), and asset impairment analysis[584](index=584&type=chunk) [ESG Committee](index=130&type=section&id=ESG%20Committee) The ESG Committee oversaw the 'This is Forward' sustainability plan in 2023, focusing on carbon reduction, packaging, water stewardship, and regulatory developments - The ESG Committee's main focus in 2023 was overseeing CCEP's **'This is Forward' sustainability action plan** across all six action areas[602](index=602&type=chunk) - The Committee reviewed CCEP's carbon reduction roadmap, including a deep dive into **Scope 3 GHG emissions**, following SBTi validation of 2030 and Net Zero 2040 targets[604](index=604&type=chunk) - Discussions included customer sustainability expectations, regulatory developments like the **Corporate Sustainability Reporting Directive (CSRD)**, and assessments of water-related risks[605](index=605&type=chunk)[606](index=606&type=chunk) - The Committee endorsed an updated Group water use efficiency target and a new approach to evaluating health and safety performance[606](index=606&type=chunk) [Directors' Remuneration Report](index=132&type=section&id=Directors'%20remuneration%20report) The 2023 remuneration outcomes reflect strong business performance, with the CEO's annual bonus at 79% of maximum and the 2021 LTIP vesting at 185% of target - Remuneration outcomes for 2023 reflected strong overall business performance, with the **CEO's annual bonus at 79% of maximum** due to above-target financial metrics and exceptional individual leadership[619](index=619&type=chunk) 2023 Annual Bonus Performance | Metric (2023 Annual Bonus) | Weighting | Actual Outcome | Multiplier Achieved | |:---|:---|:---|:---| | Operating Profit | 50% | €2,423m | 1.91x | | Revenue | 30% | €18,655m | 1.03x | | Operating Free Cash Flow | 20% | €2,481m | 1.95x | | Total Business Performance Factor (BPF) | 100% | N/A | 1.65x | | CEO Individual Performance Factor (IPF) | N/A | N/A | 1.15x | 2021 LTIP Vesting Performance | Metric (2021 LTIP Vesting) | Weighting | Actual Performance Outcome | Final Vesting Level | |:---|:---|:---|:---| | EPS | 42.5% | €3.78 | 2.00x | | ROIC | 42.5% | 10.4% | 2.00x | | CO2e reduction per litre | 15% | 17.4% | 2.00x | | Total Formulaic Vesting Level | N/A | N/A | 2.00x | | Total Vesting after Discretion | N/A | N/A | 1.85x | - For 2024, the CEO will receive a **2.0% salary increase**, and LTIP awards will be made in Q2 to incorporate the CCBPI acquisition, with targets set at stretching levels[624](index=624&type=chunk)[625](index=625&type=chunk)[626](index=626&type=chunk)[683](index=683&type=chunk) Employee Expenditure vs Dividends | Remuneration Component | 2023 (€m) | 2022 (€m) | % Change | |:---|:---|:---|:---| | Total Employee Expenditure | 2,433 | 2,318 | 5.0% | | Dividends | 841 | 763 | 10.2% | Financial Statements [Report of Independent Registered Public Accounting Firm](index=154&type=section&id=Report%20of%20independent%20registered%20public%20accounting%20firm) Ernst & Young LLP issued unqualified opinions on CCEP's 2023 financial statements and internal controls, highlighting key audit matters in marketing costs and tax positions - Ernst & Young LLP issued an **unqualified opinion** on CCEP's consolidated financial statements for the period ended December 31, 2023, confirming fair presentation in conformity with IFRS[725](index=725&type=chunk) - An **unqualified opinion** was also expressed on the effectiveness of CCEP's internal control over financial reporting as of December 31, 2023[726](index=726&type=chunk)[732](index=732&type=chunk) - Critical audit matters included the completeness and measurement of **accrued customer marketing costs (€1.3 billion as of Dec 31, 2023)** due to estimation uncertainty in promotional programs, and the accounting for **uncertain tax positions (€175 million in current tax liabilities)** due to inherent uncertainties in tax exposures across numerous jurisdictions[730](index=730&type=chunk)[731](index=731&type=chunk) [Consolidated Income Statement](index=157&type=section&id=Consolidated%20income%20statement) CCEP's 2023 income statement shows strong profitability, with revenue growing to €18,302 million and profit after taxes reaching €1,669 million Consolidated Income Statement | Metric | 2023 (€ million) | 2022 (€ million) | 2021 (€ million) | |:---|:---|:---|:---| | Revenue | 18,302 | 17,320 | 13,763 | | Cost of sales | (11,582) | (11,096) | (8,677) | | Gross profit | 6,720 | 6,224 | 5,086 | | Selling and distribution expenses | (3,178) | (2,984) | (2,496) | | Administrative expenses | (1,310) | (1,250) | (1,074) | | Other income | 107 | 96 | — | | Operating profit | 2,339 | 2,086 | 1,516 | | Finance income | 65 | 67 | 43 | | Finance costs | (185) | (181) | (172) | | Total finance costs, net | (120) | (114) | (129) | | Profit before taxes | 2,203 | 1,957 | 1,382 | | Taxes | (534) | (436) | (394) | | Profit after taxes | 1,669 | 1,521 | 988 | | Basic earnings per share (€) | 3.64 | 3.30 | 2.15 | | Diluted earnings per share (€) | 3.63 | 3.29 | 2.15 | [Consolidated Statement of Comprehensive Income](index=158&type=section&id=Consolidated%20statement%20of%20comprehensive%20income) CCEP's total comprehensive income for 2023 was €1,363 million, reflecting profit after taxes of €1,669 million offset by other comprehensive losses Consolidated Statement of Comprehensive Income | Metric | 2023 (€ million) | 2022 (€ million) | 2021 (€ million) | |:---|:---|:---|:---| | Profit after taxes | 1,669 | 1,521 | 988 | | Foreign currency translation, net of tax | (246) | (205) | 260 | | Cash flow hedges, net of tax | 10 | (47) | 214 | | Other reserves, net of tax | 3 | (6) | 6 | | Pension plan remeasurements, net of tax | (73) | (34) | 238 | | Other comprehensive (loss)/income for the period, net of tax | (306) | (292) | 718 | | Comprehensive income for the period | 1,363 | 1,229 | 1,706 | [Consolidated Statement of Financial Position](index=159&type=section&id=Consolidated%20statement%20of%20financial%20position) As of December 31, 2023, CCEP's total assets were €29,254 million, while total equity increased to €7,976 million Consolidated Statement of Financial Position | Asset/Liability/Equity | 2023 (€ million) | 2022 (€ million) | |:---|:---|:---| | **ASSETS** | | | | Total non-current assets | 22,649 | 22,770 | | Total current assets | 6,605 | 6,543 | | **Total assets** | **29,254** | **29,313** | | **LIABILITIES** | | | | Total non-current liabilities | 14,000 | 14,553 | | Total current liabilities | 7,278 | 7,313 | | **Total liabilities** | **21,278** | **21,866** | | **EQUITY** | | | | Equity attributable to shareholders | 7,976 | 7,447 | | **Total equity** | **7,976** | **7,447** | [Consolidated Statement of Cash Flows](index=160&type=section&id=Consolidated%20statement%20of%20cash%20flows) CCEP's 2023 net cash from operating activities was €2,806 million, with significant cash used for investing and financing activities Consolidated Statement of Cash Flows | Cash Flow Category | 2023 (€ million) | 2022 (€ million) | 2021 (€ million) | |:---|:---|:---|:---| | Net cash flows from operating activities | 2,806 | 2,932 | 2,117 | | Net cash flows used in investing activities | (937) | (645) | (5,605) | | Net cash flows (used in)/from financing activities | (1,822) | (2,276) | 3,289 | | Net change in cash and cash equivalents | 47 | 11 | (199) | | Cash and cash equivalents at end of period | 1,419 | 1,387 | 1,407 | - Primary uses of cash in investing activities included **€672 million for property, plant and equipment**, and €140 million for capitalised software[746](index=746&type=chunk) - Financing activities included **€1,159 million in repayments on third-party borrowings** and **€841 million in dividends paid**, partially offset by €694 million in proceeds from new borrowings[746](index=746&type=chunk) [Consolidated Statement of Changes in Equity](index=161&type=section&id=Consolidated%20statement%20of%20changes%20in%20equity) Total equity increased to €7,976 million in 2023, driven by profit after taxes, partially offset by dividends and other comprehensive losses Consolidated Statement of Changes in Equity | Equity Component | As at 1 Jan 2021 (€m) | As at 31 Dec 2021 (€m) | As at 31 Dec 2022 (€m) | As at 31 Dec 2023 (€m) | |:---|:---|:---|:---|:---| | Share capital | 5 | 5 | 5 | 5 | | Share premium | 192 | 220 | 234 | 276 | | Merger reserves | 287 | 287 | 287 | 287 | | Other reserves | (537) | (156) | (507) | (823) | | Retained earnings | 6,078 | 6,677 | 7,428 | 8,231 | | Equity attributable to shareholders | 6,025 | 7,033 | 7,447 | 7,976 | | Non-controlling interest | — | 177 | — | — | | Total equity | 6,025 | 7,210 | 7,447 | 7,976 | - **Profit after taxes contributed €1,669 million** to equity in 2023, while **dividends paid amounted to €844 million**[748](index=748&type=chunk) - **Other comprehensive loss of €306 million** in 2023 was primarily due to foreign currency translation adjustments and pension plan remeasurements[748](index=748&type=chunk) [Notes to the Consolidated Financial Statements](index=162&type=section&id=Notes%20to%20the%20consolidated%20financial%20statements) The notes provide detailed accounting policies and disclosures, covering key areas such as significant judgments, segment information, and related party transactions - CCEP's consolidated financial statements are prepared in accordance with UK adopted IFRS, IFRS as adopted by the EU, and IFRS as issued by the IASB, on a going concern basis[753](index=753&type=chunk)[755](index=755&type=chunk) - Climate change risks were considered for asset and liability valuations, with **no material impact identified for 2023**, but ongoing monitoring is planned[752](index=752&type=chunk) - Significant judgments include assigning indefinite lives to TCCC bottling agreements and brands, while key estimates involve impairment of indefinite-lived intangible assets and goodwill, deductions from revenue, income tax, and defined benefit plans[788](index=788&type=chunk) Key Financial Statement Items (2023) | Financial Statement Item | 2023 (€ million) | 2022 (€ million) | |:---|:---|:---| | Intangible assets (net book value) | 12,395 | 12,505 | | Goodwill (net book value) | 4,514 | 4,600 | | Property, plant and equipment (net book value) | 5,344 | 5,201 | | Total Borrowings (carrying value) | 11,396 | 11,907 | | Trade and other payables | 5,234 | 5,052 | | Total Employee Costs | 2,433 | 2,318 | | Income Tax Charge | 534 | 436 | - Related party transactions with TCCC included **€3,964 million in cost of sales** (purchases of concentrate, marketing funding) and **€140 million affecting revenue** (fountain syrup, packaged product sales)[979](index=979&type=chunk) [Note 1: General Information and Basis of Preparation](index=162&type=section&id=Note%201%20General%20information%20and%20basis%20of%20preparation) This note outlines CCEP's identity, basis of preparation under IFRS, and confirmation that climate change impact was deemed immaterial for 2023 - CCEP is a leading consumer goods group in Western Europe and Asia Pacific, making, selling, and distributing non-alcoholic ready-to-drink beverages[749](index=749&type=chunk) - The financial statements are prepared in accordance with UK adopted IFRS, IFRS as adopted by the EU, and IFRS as issued by the IASB, on a historical cost and going concern basis[753](index=753&type=chunk)[754](index=754&type=chunk)[755](index=755&type=chunk) - Consideration of climate change risks had **no material impact** on financial reporting judgments and estimates for 2023, but the Group will continue to monitor implications[752](index=752&type=chunk) [Note 3: Significant Judgments and Estimates](index=165&type=section&id=Note%203%20Significant%20judgements%20and%20estimates) This note details significant judgments, such as assigning indefinite lives to TCCC bottling agreements, and key estimates involving impairment, revenue deductions, and taxes - Significant judgments include assigning **indefinite lives to TCCC bottling agreements**, based on the interdependent relationship with TCCC and history of renewals[788](index=788&type=chunk) - Key estimates involve **impairment of indefinite-lived intangible assets and goodwill**, requiring management's estimation of future cash flows and appropriate discount rates, including climate-related risks[788](index=788&type=chunk) - Estimates for **deductions from revenue and sales incentives** are made on an ongoing basis, assessing variable consideration based on historical customer experience and expected sales volumes[790](index=790&type=chunk) - **Income tax estimates** involve assessing tax exposures in numerous jurisdictions, recognizing provisions for uncertain tax positions, and evaluating deferred tax asset recoverability[791](index=791&type=chunk) [Note 6: Intangible Assets and Goodwill](index=168&type=section&id=Note%206%20Intangible%20assets%20and%20goodwill) CCEP's intangible assets are primarily TCCC franchise agreements (€11,758 million) and goodwill (€4,514 million), with no impairment charges recorded in 2023 - TCCC franchise intangible assets (**€11,758 million**) and brands (€32 million) are assigned indefinite lives and are not amortized, but tested annually for impairment[805](index=805&type=chunk)[807](index=807&type=chunk)[808](index=808&type=chunk)[816](index=816&type=chunk) - Goodwill totaled **€4,514 million** as of December 31, 2023, allocated to CGUs and tested annually for impairment[810](index=810&type=chunk)[816](index=816&type=chunk) - An **accelerated amortization charge of €27 million** was recognized in 2023 for non-TCCC franchise intangibles due to the discontinuation of the Beam Suntory relationship[814](index=814&type=chunk) - **No impairment charges were recorded in 2023 or 2022**, with the Pacific CGU having approximately 11% headroom in its 2023 impairment analysis, sensitive to a 0.9% reduction in terminal growth rate or a 0.7% increase in discount rate[825](index=825&type=chunk) [Note 13: Borrowings and Leases](index=181&type=section&id=Note%2013%20Borrowings%20and%20leases) CCEP's total borrowings decreased in 2023, supported by an undrawn €1.80 billion credit facility and new note issuances for the CCBPI acquisition Borrowings Overview (2023 vs 2022) | Borrowing Category | 2023 (€ million) | 2022 (€ million) | |:---|:---|:---| | Total Non-current Borrowings | 10,096 | 10,571 | | Total Current Borrowings | 1,300 | 1,336 | | Total Borrowings (carrying value) | 11,396 | 11,907 | | Multi-currency Credit Facility | 1,800 (available) | 1,950 (available) | | Drawn on Credit Facility | 0 | 0 | - In 2023, CCEP repaid **US$850 million 0.5% Notes**, US$50 million 4.34% Notes, and **€350 million 2.625% Notes**[898](index=898&type=chunk) - New **€700 million 3.875% Notes due 2030** were issued in December 2023 for the proposed acquisition of CCBPI[897](index=897&type=chunk) - Total cash outflows for leases were **€165 million** in 2023[906](index=906&type=chunk) [Note 19: Related Party Transactions](index=196&type=section&id=Note%2019%20Related%20party%20transactions) This note details transactions with related parties, primarily TCCC and Cobega, including concentrate purchases and the acquisition of PT Coca-Cola Bottling Indonesia - TCCC, holding **19.20% of CCEP's shares**, is a key related party; transactions in 2023 included **€3,964 million affecting cost of sales** (concentrate, marketing funding) and **€140 million affecting revenue** (fountain syrup, packaged product sales)[974](index=974&type=chunk)[979](index=979&type=chunk) - The acquisition of the remaining **29.4% ownership interest in PT Coca-Cola Bottling Indonesia from TCCC** was completed in February 2023 for €282 million[980](index=980&type=chunk) - Cobega, with **20.80% indirect ownership**, had transactions totaling **€86 million** affecting the consolidated income statement in 2023, primarily for packaging materials and maintenance services[984](index=984&type=chunk)[985](index=985&type=chunk) - CCEP also engages in transactions with associates and joint ventures, with net amounts affecting the consolidated income statement totaling **€181 million** in 2023, mainly related to container deposit scheme charges[989](index=989&type=chunk) Further Sustainability Information [Key Performance Data Summary](index=219&type=section&id=Key%20performance%20data%20summary) CCEP's 2023 sustainability data shows progress in GHG emissions reduction, rPET usage, water replenishment, sustainable sourcing, and gender diversity Key Sustainability Performance Data | Metric | Target | 2023 Group Performance | 2022 Group Performance | |:---|:---|:---|:---| | Scope 1, 2 and 3 GHG emissions – Full value chain (tonnes of CO2e) | 30% reduction by 2030 (vs. 2019) | 5,263,122 | 5,586,151 | | Absolute reduction in total value chain GHG emissions (Scope 1, 2 and 3) since 2019 (%) | -30% by 2030 | 16.7 | 11.6 | | Percentage of electricity consumed that comes from renewable sources (%) | 100% by 2030 | 78.0 | 73.1 | | Percentage of all primary packaging that is recyclable (%) | 100% by 2025 | 99.1 | N/A | | Percentage of PET used which is rPET (%) | 50% by 2025 | 54.6 | 48.5 | | Primary packaging collected for recycling as a percentage of total primary packaging (%) | 100% by 2030 | 73.2 | 72.0 | | Total volume of water replenished (1,000m3) | 100% by 2030 | 18,339 | 19,732 | | Water replenished as percentage of total sales volumes (%) | 100% by 2030 | 98.7 | 105.5 | | Manufacturing water use ratio reduction since 2019 (%) | 10% vs. 2019 | 4.9 | 1.3 | | Percentage of sugar sourced through suppliers in compliance with PSA (%) | 100% | 99.4 | 97.6 | | Percentage of women in management positions (%) | 45% by 2030 | 38.4 | 37.2 | | Safety – Total incident rate (TIR) | <1 by 2025 | 0.84 | 0.87 | - CCEP achieved a **16.7% absolute reduction** in total value chain GHG emissions since 2019, with **78.0% of electricity consumed from renewable sources** in 2023[1114](index=1114&type=chunk) - In packaging, **99.1% of primary packaging is recyclable**, and **54.6% of PET used is rPET**, exceeding the 50% target for 2025[1118](index=1118&type=chunk) - Water replenishment reached **98.7% of total sales volumes**, and the manufacturing water use ratio saw a **4.9% reduction since 2019**[1118](index=1118&type=chunk) [Approach to Sustainability Reporting and Methodologies](index=222&type=section&id=Approach%20to%20sustainability%20reporting%20and%20methodologies) CCEP calculates its carbon footprint using the GHG Protocol Corporate Standard, covering the full value chain and restating data for accuracy and acquisitions - CCEP calculates its carbon footprint in accordance with the **WRI/WBCSD GHG Protocol Corporate Standard**, using an operational control approach[1126](index=1126&type=chunk) - GHG emissions are reported across **Scope 1, 2, and 3**, covering the full value chain, including production, distribution, ingredients, packaging, and cold drink equipment[1127](index=1127&type=chunk)[1145](index=1145&type=chunk) - The 2019 baseline and subsequent year data are restated for significant acquisitions, new emissions factors, and more accurate data, with a significance threshold of 5%[1130](index=1130&type=chunk)[1131](index=1131&type=chunk) - Scope 2 emissions are reported using a **market-based approach**, incorporating renewable electricity certificates and Power Purchase Agreements[1133](index=1133&type=chunk)[1138](index=1138&type=chunk) Other Information [Risk Factors](index=227&type=section&id=Risk%20factors) CCEP faces material risks from catastrophic events, packaging regulations, tax changes, cyber threats, economic volatility, and shifts in consumer trends - Global or regional catastrophic events (natural disasters, wars, cyber attacks) could negatively impact CCEP's business and financial results by disrupting operations and supply chains[1158](index=1158&type=chunk)[1159](index=1159&type=chunk) - **Packaging waste and pollution**, along with stringent regulations (e.g, mandatory reuse targets, recycled content, plastic taxes), could increase costs, damage reputation, and reduce consumer acceptance[1160](index=1160&type=chunk)[1161](index=1161&type=chunk)[1162](index=1162&type=chunk)[1163](index=1163&type=chunk)[1164](index=1164&type=chunk) - Future changes to tax laws (e.g, **Pillar Two, sugar/plastic taxes**) and increased regulation on operations, products, and marketing could adversely affect financial results and increase compliance costs[1168](index=1168&type=chunk)[1170](index=1170&type=chunk)[1171](index=1171&type=chunk)[1177](index=1177&type=chunk)[1178](index=1178&type=chunk) - **Cyber attacks and IT system failures** pose risks to data confidentiality, integrity, and availability, potentially disrupting operations and damaging brand reputation[1192](index=1192&type=chunk)[1193](index=1193&type=chunk)[1195](index=1195&type=chunk) - **Economic and political volatility** (e.g, inflation, commodity prices, geopolitical conflicts) can decrease demand, increase costs, and disrupt supply chains, particularly in regions like Papua New Guinea[1200](index=1200&type=chunk)[1201](index=1201&type=chunk)[1203](index=1203&type=chunk)[1204](index=1204&type=chunk)[1205](index=1205&type=chunk) - **Water scarcity, climate change impacts** (extreme weather, agricultural disruption), and health concerns regarding product contents (sugar, sweeteners) could reduce demand and increase costs[1221](index=1221&type=chunk)[1224](index=1224&type=chunk)[1225](index=1225&type=chunk)[1228](index=1228&type=chunk)[1229](index=1229&type=chunk)[1230](index=1230&type=chunk) [Other Group Information](index=236&type=section&id=Other%20Group%20information) This section provides details on CCEP's incorporation, shareholder information, marketing strategies, competitive landscape, and property portfolio - CCEP was incorporated in England and Wales, with its shares traded on Nasdaq, LSE, Euronext Amsterdam, and Spanish Stock Exchanges[1254](index=1254&type=chunk)[1255](index=1255&type=chunk)[1266](index=1266&type=chunk) - Executive Directors' service contracts provide for a **12-month notice period**, with no additional payments for termination, and benefits paid according to redundancy guidelines[1258](index=1258&type=chunk) Outstanding Share-Based Payment Awards (as of 29 Feb 2024) | Share-based Payment Awards (as of 29 Feb 2024) | Number of Shares Subject to Outstanding Options | |:---|:---| | 2010 Plan Options | 733,872 | | CCEP LTIP PSUs | 851,058 | | CCEP LTIP RSUs | 83,690 | - CCEP relies extensively on advertising and sales promotions, benefiting from TCCC's global programs, and engages in various marketing programs with customers[1284](index=1284&type=chunk)[1285](index=1285&type=chunk)[1286](index=1286&type=chunk) - The Group's principal properties include **45 production facilities (41 owned)**, 31 distribution/logistics facilities, and 9 corporate offices, covering approximately 5.6 million square meters[1373](index=1373&type=chunk)[1378](index=1378&type=chunk) - Management assessed the effectiveness of internal control over financial reporting as **effective as of December 31, 2023**, with no material changes during the year[1384](index=1384&type=chunk)[1385](index=1385&type=chunk) [Shareholder Information](index=236&type=section&id=Shareholder%20information) CCEP is a public company with its 2024 AGM scheduled for May 22, and as of February 29, 2024, 99.97% of issued shares were held by US record holders - CCEP is a public company incorporated in England and Wales, with its **2024 AGM scheduled for May 22, 2024**[1254](index=1254&type=chunk)[1256](index=1256&type=chunk) - Executive Directors have service contracts with a **12-month notice period**, and Non-executive Directors have letters of appointment without compensation on leaving[1258](index=1258&type=chunk)[1260](index=1260&type=chunk) - As of February 29, 2024, **99.97% of CCEP's issued shares** were held by 405 record holders with US addresses[1277](index=1277&type=chunk) [Nature of Trading Market](index=237&type=section&id=Nature%20of%20trading%20market) CCEP's ordinary shares trade on multiple exchanges, with 459,200,818 shares issued and fully paid as of December 31, 2023 - CCEP's ordinary shares are traded on the **Nasdaq Stock Market, London Stock Exchange, Euronext Amsterdam, and the Spanish Stock Exchanges**[1266](index=1266&type=chunk) - As of December 31, 2023, CCEP had **459,200,818 shares issued and fully paid**, with no upper limit on authorized share capital[1268](index=1268&type=chunk) - Shareholder resolutions authorize the Board to allot new shares, up to a nominal amount of €1,527,551.12 (152,755,112 shares) for general purposes and €3,055,102.25 (305,510,225 shares) for rights issues[1270](index=1270&type=chunk)[1271](index=1271&type=chunk) [Share Buyback Programme](index=238&type=section&id=Share%20buyback%20programme) CCEP's €1 billion share buyback program remains suspended, with no shares purchased under the 2023 authority - CCEP's share buyback program of up to **€1 billion**, announced in February 2020, was suspended in March 2020 due to macroeconomic uncertainty[1274](index=1274&type=chunk) - **No shares were purchased** under the 2023 shareholder authority, which allowed for the purchase of up to 45,826,533 shares (10% of issued shares)[1276](index=1276&type=chunk) - The company intends to seek shareholder approval to renew the authority to buy back shares at the 2024 AGM[1276](index=1276&type=chunk) [Marketing](index=240&type=section&id=Marketing) CCEP relies heavily on advertising and sales promotions, benefiting from TCCC's global programs while also running its own customer-focused initiatives - CCEP relies extensively on advertising and sales promotions, benefiting from TCCC's global, regional, and local advertising programs[1284](index=1284&type=chunk) - Marketing support funding from TCCC is principally based on product sales or completion of stated requirements, offsetting a portion of CCEP's marketing program costs[1285](index=1285&type=chunk) - CCEP engages in various programs with customers, offering allowances for achieving agreed sales levels or participating in specific marketing initiatives[1286](index=1286&type=chunk) [Competition](index=240&type=section&id=Competition) CCEP operates in a highly c

Coca-Cola Europacific Partners PLC (NASDAQ:CCEP) Q4 2023 Earnings Conference Call February 23, 2024 7:30 AM ET Company Participants Sarah Willett - Vice President of Investor Relations & Corporate Strategy Damian Gammell - Chief Executive Officer Nik Jhangiani - Chief Financial Officer Conference Call Participants Edward Mundy - Jefferies Matthew Ford - BNP Paribas Lauren Lieberman - Barclays Sanjeet Aujla - UBS Eric Serotta - Morgan Stanley Charlie Higgs - Redburn Atlantic Simon Hales - Citi Bonnie Herzog ...

Investors interested in Consumer Staples stocks should always be looking to find the best-performing companies in the group. Is Coca-Cola European (CCEP) one of those stocks right now? By taking a look at the stock's year-to-date performance in comparison to its Consumer Staples peers, we might be able to answer that question.Coca-Cola European is one of 193 individual stocks in the Consumer Staples sector. Collectively, these companies sit at #13 in the Zacks Sector Rank. The Zacks Sector Rank considers 16 ...

Investors interested in Beverages - Soft drinks stocks are likely familiar with Coca-Cola European (CCEP) and Coca-Cola (KO) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphasis on earnings estimates and estim ...

Investors with an interest in Beverages - Soft drinks stocks have likely encountered both Coca-Cola European (CCEP) and Coca-Cola (KO) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, and ...

Operator Simon Hales Damian Gammell Simon Hales Damian Gammell And that was critical because as we've talked previously, we were trying to do too many things across too many categories. That led to SKU rationalization. So that 70% of our volume reduction in Indonesia has been on the back of that. So the remainder puts us on what you've called out, which is a bit of a weaker macro environment for the consumer. And that's really challenged the affordability. And that's really on the back of fuel rise, just ge ...