Docoh
Loading...

CCEP Coca-Cola European Partners


United States
Securities and Exchange Commission
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934

For the period ending 27 March 2020
Commission File Number 001-37791

COCA-COLA EUROPEAN PARTNERS PLC

Pemberton House, Bakers Road
Uxbridge, UB8 1EZ, United Kingdom
(Address of principal executive office)
(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)
(Check One) Form 20-F ý Form 40-F D ¨
(Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1))
(Check One) Yes ¨ No ý
(Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7))
(Check One) Yes ¨ No ý


THIS REPORT ON FORM 6-K IS HEREBY INCORPORATED BY REFERENCE INTO THE REGISTRANT’S
REGISTRATION STATEMENT ON FORM F-3 OF COCA-COLA EUROPEAN PARTNERS PLC (REGISTRATION NO. 333-219945);
POST-EFFECTIVE AMENDMENT NO.1 ON FORM S-8 TO THE FORM F-4 REGISTRATION STATEMENT OF COCA-COLA EUROPEAN PARTNERS PLC (REGISTRATION NO. 333-208556);
REGISTRATION STATEMENT ON FORM S-8 OF COCA-COLA EUROPEAN PARTNERS PLC (REGISTRATION NO. 333-211764);     
REGISTRATION STATEMENT ON FORM S-8 OF COCA-COLA EUROPEAN PARTNERS PLC (REGISTRATION NO. 333-233695); AND
REGISTRATION STATEMENT ON FORM S-8 OF COCA-COLA EUROPEAN PARTNERS PLC (REGISTRATION NO. 333-233697).
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, AND SHALL BE A PART THEREOF FROM THE DATE ON WHICH THIS REPORT IS FILED, TO THE EXTENT NOT SUPERSEDED BY DOCUMENTS OR REPORTS SUBSEQUENTLY FILED OR FURNISHED.
THIS REPORT ON FORM 6-K INCLUDES SUBSTANTIALLY THE SAME INFORMATION AS THAT REPORTED IN THE REGISTRANT’S REPORT ON FORM 6-K PREVIOUSLY FURNISHED TO THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 28, 2020, AND IS BEING FILED SOLELY FOR THE PURPOSE OF INCORPORATING BY REFERENCE INFORMATION INTO THE ABOVE-REFERENCED REGISTRATION STATEMENTS AND ANY FUTURE REGISTRATION STATEMENTS IN WHICH THE REGISTRANT IDENTIFIES THIS REPORT ON FORM 6-K AS BEING INCORPORATED BY REFERENCE.



cceplogoc62.jpg
P a g e | 1
  

LONDON, 28th April 2020

COCA-COLA EUROPEAN PARTNERS

First-Quarter ended 27 March 2020 & COVID-19 Update



Note Regarding the Presentation of Alternative Performance Measures
We use certain alternative performance measures (non-GAAP performance measures) to make financial, operating and planning decisions and to evaluate and report performance. We believe these measures provide useful information to investors and as such, where clearly identified, we have included certain alternative performance measures in this document to allow investors to better analyse our business performance and allow for greater comparability. To do so, we have excluded items affecting the comparability of period over period financial performance as described below. The alternative performance measures included herein should be read in conjunction with and do not replace the directly reconcilable GAAP measure. For further information, please refer to pages 26-33 of the 2019 Integrated Report / Annual Report on Form 20-F.

For purposes of this document, the following terms are defined:

‘‘As reported’’ are results extracted from our consolidated financial statements.

‘‘Comparable’’ is defined as results excluding items impacting comparability, such as restructuring charges, out of period mark-to-market impact of hedges and net tax items relating to rate and law changes. Comparable volume is also adjusted for selling days.

‘‘Fx-neutral’’ is defined as comparable results excluding the impact of foreign exchange rate changes. Foreign exchange impact is calculated by recasting current year results at prior year exchange rates.

‘‘Capex’’ or “Capital expenditures’’ is defined as purchases of property, plant and equipment and capitalised software, plus payments of principal on lease obligations, less proceeds from disposals of property, plant and equipment. Capex is used as a measure to ensure that cash spending on capital investment is in line with the Group’s overall strategy for the use of cash.

‘‘Free cash flow’’ is defined as net cash flows from operating activities less capital expenditures (as defined above) and interest paid. Free cash flow is used as a measure of the Group’s cash generation from operating activities, taking into account investments in property, plant and equipment and non-discretionary lease and interest payments. Free cash flow is not intended to represent residual cash flow available for discretionary expenditures.

‘‘Adjusted EBITDA’’ is calculated as Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA), after adding back items impacting the comparability of year over year financial performance. Adjusted EBITDA does not reflect cash expenditures, or future requirements for capital expenditures or contractual commitments. Further, adjusted EBITDA does not reflect changes in, or cash requirements for, working capital needs, and although depreciation and amortisation are non-cash charges, the assets being depreciated and amortised are likely to be replaced in the future and adjusted EBITDA does not reflect cash requirements for such replacements.

‘‘Net debt’’ is defined as the net of cash and cash equivalents less currency adjusted borrowing. We believe that reporting net debt is useful as it reflects a metric used by the Group to assess cash management and leverage. In addition, the ratio of net debt to adjusted EBITDA is used by investors, analysts and credit rating agencies to analyse our operating performance in the context of targeted financial leverage.

‘‘ROIC’’ is defined as comparable operating profit after tax divided by the average of opening and closing invested capital for the year. Invested capital is calculated as the addition of borrowings and equity less cash and cash equivalents. ROIC is used as a measure of capital efficiency and reflects how well the Group generates comparable operating profit relative to the capital invested in the business.

‘‘Dividend Payout Ratio’’ is defined as dividends as a proportion of comparable profit after tax.

Additionally, within this report, we provide certain forward-looking non-GAAP financial Information, which management uses for planning and measuring performance. We are not able to reconcile forward-looking non-GAAP measures to reported measures without unreasonable efforts because it is not possible to predict with a reasonable degree of certainty the actual impact or exact timing of items that may impact comparability throughout the year.

Unless otherwise stated, percent amounts are rounded to the nearest 0.5%.





cceplogoc62.jpg
P a g e | 2
  

      CHANGE VS Q1 2019
REVENUE 
VOLUME
(UNIT CASES
1)
 
REVENUE PER UNIT CASE2
 
COMPARABLE VOLUME3,4
 
REVENUE PER UNIT CASE2
 
FX-NEUTRAL REVENUE3
 REVENUE
€2,478m 521m €4.77 (4.0)% 1.5% (4.0)% (4.0)%


1.A unit case equals approximately 5.678 litres or 24 8-ounce servings
2.Fx-neutral
3.Refer to “Note Regarding the Presentation of Alternative Performance Measures” for further details
4.Adjusted for selling day shift. Reported volume (5.0)%



cceplogoc62.jpg
P a g e | 3
  

Q1 HIGHLIGHTS & COVID-19 UPDATE1 

Q1 Revenue (-4.0% (versus Q1 2019))

Comparable volume2 -4.0% (versus Q1 2019) reflecting challenging comparables, some customer disruption as a result of our planned pricing strategy & the initial impact of the COVID-19 pandemic across our markets, partially offset by innovation; Transactions3 outpaced volume
Revenue per unit case4 +1.5% (versus Q1 2019) benefiting from favourable price & promotions offset by negative channel & pack mix, particularly in March, given emerging AFH5 closures
Value share gains across measured channels6 driven by our Stills portfolio

COVID-19

Total volume declines for the COVID-19 impacted weeks to date (5 weeks ending 17 April 2020) in a range of c.-20% to -40% (AFH: range of -45% to -85%; Home: range of +5% to -10%) across our markets
  

Other

Dividend:
FY19 dividend of €1.24 per share fully paid during 2019
The Board continues to recognise the importance of cash returns to shareholders. However, given the significant uncertainty of the effect of the ongoing pandemic, the Board has determined to defer consideration of its 2020 H1 dividend until visibility has improved, thus preserving flexibility until a better, informed decision as to appropriate quantum can be made
Share buyback: repurchased c.€130m (3m shares) of the €1bn programme announced Feb 2020 (suspended until further notice as previously announced)
Successfully issued €600m senior unsecured note due 2026
Sweden became first 100% recycled PET market, eliminating the use of 3,500 tons of virgin plastic per year. Launched 2020 long-term incentive plan incorporating inaugural GHG7 reduction target






















1.Refer to “Note Regarding the Presentation of Alternative Performance Measures” for further details
2.Adjusted for selling day shift; Reported volume (5.0)%
3.Adjusted for selling day shift; Defined as the serving container that is ultimately used directly by the consumer. It can be a standalone container or one part of a multipack
4.Fx-neutral
5.Away from home
6.Source: Nielsen YTD to w/e GB 28.03.20; DE Monthly SSD 29.03.20 & NCB 23.02.20; ES PT FR BE NL SE NO 29.03.20
7.GHG = greenhouse gas;15% of the 2020 long-term incentive award will be based on the extent to which CCEP reduces its greenhouse gas emissions over the next three years



cceplogoc62.jpg
P a g e | 4
  

COVID-19 IMPACT

Trading impacts:

Ongoing volatility in both channels (AFH & Home) given uncertainty
Sharp declines in AFH volumes with c.75% of the channel impacted by lockdown measures (which vary by market)
Some initial stockpiling in Home has since subsided
Immediate consumption & small priority packs significantly impacted (affects both AFH & Home channels); Future consumption packs performing better, though varies by market
Total volume decline for the COVID-19 impacted weeks to date (5 weeks ending 17 April 2020) in a range of c.-20% to -40% (AFH: range of -45% to -85%; Home: range of +5% to -10%) across our markets
  

CCEP response to crisis: Respond, Recover, Sustain

Our rapid response has prioritised our people, customers & communities whilst protecting our business for the long term. Measures taken are as follows:
People
Implemented comprehensive measures in line with official guidance from governments & health authorities to keep our people safe including:
Large scale home working supported by up-weighted digital support
Additional safety measures to support those in the field or at manufacturing sites
Emotional & mental well-being support of our people through this stressful & uncertain time
Motivating & providing workplace security for our people
Regular internal communications across the business

Customers
Working closely with our suppliers, partners & KO1 to ensure we do everything we can to best serve our customers including:
Continued build of finished goods & raw material inventory
Shifting production resource to higher demand channels by prioritising core SKUs2, reflecting the shift in brand & pack mix (e.g. more multipack cans & large PET)
Developing comprehensive contingency plans to ensure our products continue to be available despite any logistical challenges

Communities
Working closely with KO1 to provide substantial financial aid through the Red Cross & other local NGOs
Donated over 400k unit cases of product so far to foodbanks, medical & key workers & giving access to our logistics resources for relief work
Volunteering policy to encourage in-community support where it is safe to do so







1.Stock market ticker for The Coca-Cola Company
2.Stock keeping unit




cceplogoc62.jpg
P a g e | 5
  

COVID-19 IMPACT (Continued)

Business
Governance
Increased cadence of reviews with country leadership teams teams, Board of Directors & KO1 
Incorporating learnings from across the Coca-Cola system
Modelling multiple scenarios & risk analyses to regularly stress test our financials

Costs
Reducing discretionary spend in areas such as trade marketing, promotions, merchandising, incentives, seasonal labour, travel & meetings - amounting to a potential FY20 reduction of c.€200-250m
Delaying c.€200m of discretionary capital expenditure, resulting in FY20 total capex of c.€350m2 

Finance
Withdrawal of FY20 guidance given significant uncertainty as previously announced

To keep CCEP well positioned given its current financial position & strong balance sheet & to preserve maximum flexibility during this period:
Suspension of share buyback programme until further notice as previously announced (to date repurchased
c.€130m of €1bn programme announced Feb 2020)
FY19 dividend fully paid in 2019; Deferral of 2020 HY1 dividend until visibility has improved
Issued 6 year €600m bond at 1.75% coupon to add to an already balanced mix of long-term maturities (with no covenants on debt or facilities)
Received confirmation of eligibility to access UK Government COVID Corporate Financing Facility (CCFF)

CCEP has strong cash generation & solid position on liquidity given the following:
€0.9bn cash & cash equivalents3; €1.5bn sustainability linked committed undrawn RCF4; €1.5bn multi-currency commercial paper programme (€0.6bn issued5); unutilised CCFF6 



















1.Stock market ticker for The Coca-Cola Company
2.Excluding payments of principal on lease obligations
3.As at 27 March 2020
4.RCF = Revolving Credit Facility; Undrawn as at 24 April 2020; €0.2bn drawn as at 27 March 2020
5.As at 24 April 2020; €0.5bn issued as at 27 March 2020
6.As at 24 April 2020



cceplogoc62.jpg
P a g e | 6
  

FIRST-QUARTER REVENUE PERFORMANCE BY GEOGRAPHY
Unaudited, changes versus Q1 2019
 REVENUE REVENUE % CHANGE FX-NEUTRAL REVENUE % CHANGE
Great Britain€495m (6.5)% (7.5)%
France (France & Monaco)
€413m (6.5)% (6.5)%
Germany€517m (2.0)% (2.0)%
Iberia (Spain, Portugal & Andorra)
€529m (1.5)% (1.5)%
Northern Europe1
€524m (4.0)% (2.5)%
Total€2,478m (4.0)% (4.0)%
1. Belgium, Luxembourg, Netherlands, Norway, Sweden & Iceland

Great Britain

Volumes impacted by strong comparables (pre-Brexit build in Q1 2019); the proactive delisting
of Kia Ora; the impact of COVID-19 on the AFH channel in March. Coca-Cola Zero Sugar, Schweppes sparkling, Oasis & Monster all outperformed
Revenue/UC1 supported by category mix (primarily the growth in Monster & the delisting of Kia Ora) but negatively impacted by the outperformance of the Home channel, particularly in March (e.g. cans +9.5% in March)

France

Volumes impacted by some initial customer disruption in the Home channel & the impact of COVID-19 on the AFH channel in March. Coca-Cola Zero Sugar, Fuze Tea, Monster & Tropico all outperformed
Revenue/UC1 negatively impacted by channel mix in March, partially offset by the outperformance of priority small packs2 (e.g. small cans +17.0% YTD driven by Coca-Cola light taste 250ml)

Germany

Volumes impacted by some initial customer disruption in the Home channel & the impact of COVID-19 on the AFH channel in March, partially offset by the additional border trade business. Strong growth in Fuze Tea helped by the launch of a 1.25L discounter pack. Coca-Cola Zero Sugar, Coca-Cola Energy & Powerade also outperformed
Revenue/UC1 growth supported by positive price, pack & channel mix (e.g. outperformance of AFH, launch of 1L glass bottle & additional border trade)

Iberia

Solid volume growth in January & February more than offset by a decline in March given the impact of COVID-19 on the AFH channel. Coca-ColaTM, Monster, Aquarius & Appletiser outperformed
Revenue/UC1 negatively impacted by channel mix (e.g. the COVID-19 closure of HoReCa3 outlets) & pack mix (e.g. the outperformance of large PET)

Northern Europe

Outperformance of Belux (-1.0%) & Sweden4 (-1.5%)
Volumes supported by growth in the Home channel but more than offset by a decline in March given the impact of COVID-19 on the AFH channel. Coca-Cola Zero Sugar, Monster, Fuze Tea & Tropico outperformed
Revenue/UC1 growth negatively impacted by channel & pack mix (e.g. large PET +1.0%)

1.Revenue per unit case
2.PET & Glass < 1litre; Cans <33cl
3.HoReCa = Hotels, Restaurants & Cafes
4.Fx-neutral revenue change vs PY
Note: changes versus Q1 2019; comparable volumes




cceplogoc62.jpg
P a g e | 7
  

FIRST-QUARTER VOLUME PERFORMANCE BY CATEGORY
Comparable volumes, changes versus Q1 2019

  VOLUME % CHANGE
Sparkling (3.0)%
Coca-ColaTM
 (2.5)%
Flavours, Mixers & Energy (4.0)%
Stills (9.0)%
Hydration (12.0)%
RTD Tea, RTD Coffee, Juices & Other1
 (4.5)%
Total (4.0)%


Coca-ColaTM 

Transactions2 -2.0%, ahead of volume
Classic -3.5%; Lights -1.0% with solid growth in Zero Sugar +5.5% offset by a decline in Diet Coke/Coca-Cola light taste
Launched new lights flavours e.g. Diet Coke Sublime Lime & Coca-Cola light taste Goji Berry

Flavours, Mixers & Energy

Fanta -6.0% driven by softness in France & Germany in particular
Energy +12.0% with strong performance of Monster Mango Loco & Pacific Punch ranges. New Coca-Cola Energy variants now available in all markets
Appletiser +2.0% driven by recent launch in Iberia
Schweppes +0.5% in GB & Royal Bliss +9.0% driven by distribution gains in Spain pre COVID-19. Coca-Cola Signature Mixers also performed well

Hydration

Reflecting fewer low value promotions & the impact of COVID-19 on the AFH channel significantly impacting water sales
Encouraging initial customer reaction to Aquarius Enhanced Water
Isotonic drinks +1.0% led by growth of Aquarius in Iberia & Powerade in Germany

RTD Tea, RTD Coffee, Juices & Other1 

Solid share gains in the RTD tea category driven by Fuze Tea +12.0%, including launch of 1.25L discounter pack in Germany
Decline in juices due to the proactive delisting of our squash brand, Kia Ora in GB
Tropico continued to grow strongly in France & Belux
Costa Coffee RTD growing distribution in GB. Monster Espresso also performed well







1.RTD refers to Ready To Drink
2.Adjusted for selling day shift; Defined as the serving container that is ultimately used directly by the consumer. It can be a standalone container or one part of a multipack



cceplogoc62.jpg
P a g e | 8
  



About CCEP

Coca-Cola European Partners plc is a leading consumer goods company in Western Europe, making, selling & distributing an extensive range of non-alcoholic ready to drink beverages & is the world's largest Coca-Cola bottler based on revenue. Coca-Cola European Partners serves a consumer population of over 300 million across Western Europe, including Andorra, Belgium, continental France, Germany, Great Britain, Iceland, Luxembourg, Monaco, the Netherlands, Norway, Portugal, Spain & Sweden. The Company is listed on Euronext Amsterdam, the New York Stock Exchange, London Stock Exchange & on the Spanish Stock Exchanges, trading under the symbol CCEP.

For more information about CCEP, please visit www.cocacolaep.com & follow CCEP on Twitter at @CocaColaEP.






cceplogoc62.jpg
P a g e | 9
  

Forward-looking statements

This document contains statements, estimates or projections that constitute “forward-looking statements” concerning the financial condition, performance, results, strategy and objectives of Coca-Cola European Partners plc and its subsidiaries (together “CCEP” or the “Group”). Generally, the words “believe,” “expect,” “intend,” “estimate,” “anticipate,” “project,” “plan,” “seek,” “may,” “could,” “would,” “should,” “might,” “will,” “forecast,” “outlook,” “guidance,” “possible,” “potential,” “predict,” “objective” and similar expressions identify forward-looking statements, which generally are not historical in nature.

Forward-looking statements are subject to certain risks that could cause actual results to differ materially from CCEP’s historical experience and present expectations or projections. As a result, undue reliance should not be placed on forward-looking statements, which speak only as of the date on which they are made. These risks include but are not limited to those set forth in the “Risk Factors” section of the 2019 Integrated Report / Annual Report on Form 20-F, including the statements under the following headings: Packaging (such as marine litter); Perceived health impacts of our beverages and ingredients, and changing consumer preferences (such as sugar alternatives); Legal, regulatory and tax change (such as the development of regulations regarding packaging, taxes and deposit return schemes); Market (such as disruption due to customer negotiations, customer consolidation and route to market); Cyber and social engineering attacks; Competitiveness and transformation; Climate change and water (such as net zero emission legislation and regulation, and resource scarcity); Economic and political conditions (such as continuing developments in relation to the UK’s exit from the EU); The relationship with TCCC and other franchisors; Product quality; and Other risks, such as widespread outbreaks of infectious disease including the adverse impact that the COVID-19 pandemic and related social distancing measures implemented in many of our markets may have on our financial results, operations, workforce and demand for our products. In particular, the extent to which the ongoing COVID-19 pandemic and measures taken in response impact our business, operations and financial results will depend on future developments, which are highly uncertain and cannot be predicted.

Due to these risks, CCEP’s actual future results, dividend payments, and capital and leverage ratios may differ materially from the plans, goals, expectations and guidance set out in CCEP’s forward-looking statements. Additional risks that may impact CCEP’s future financial condition and performance are identified in filings with the SEC which are available on the SEC’s website at www.sec.gov. CCEP does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required under applicable rules, laws and regulations. CCEP assumes no responsibility for the accuracy and completeness of any forward-looking statements. Any or all of the forward-looking statements contained in this filing and in any other of CCEP’s respective public statements may prove to be incorrect.








SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorised.



 COCA-COLA EUROPEAN PARTNERS PLC
  (Registrant)
Date: April 28, 2020By:/s/ Manik Jhangiani
 Name:Manik Jhangiani
 Title:Chief Financial Officer