Kofola Sees Positive Net Profit In Q2 Amid COVID-19 Pandemic
Non-alcoholic beverage producer Kofola Group retained its strong position in Central and Eastern Europe despite facing one of the most difficult quarters in its history.
Revenue dropped by 16% year-on-year to CZK1.46 billion (€54.1 million) during the quarter, while EBITDA fell 25% to CZK230 million (€8.5 million). EBITDA margin dropped by 1.9% to 15.7%.
Although net profit dipped 93%, it remained positive at CZK5 million (€185,560).
Kofola's performance in the second quarter was impacted by the COVID-19 pandemic and related measures, but its financial performance exceeded expectations, it said.
According to the company, the positive performance was driven by its long-term strategy focused on traditional and local brands, flexibility in decision-making and extraordinary employee engagement.
Kofola's Czecho-Slovak division accounted for CZK1.08 billion in revenue (-10.09%), followed by the Adriatic arm with CZK278 million (-23.3%) and Fresh & Herbs with CZK102 million.
Fresh & Herbs saw a 37.2% decline in EBITDA as Ugo fresh and salad bars were closed due to the pandemic.
In this period, Ugo explored new avenues with the launch of the Ugo delivery service, in collaboration with partner delivery services.
In terms of sales, water and syrups were the least affected divisions.
The company completed the acquisition of Ondrášovka and Korunní mineral waters on 15 April 2020, which had a positive impact on Q2 retail sales.
Expansion And Innovation
In this period, Kofola introduced a new range of herb-flavoured waters under the Rajec Rosehip brand, as well as Kofola in half-litre cans, which exceeded sales forecasts.
Other new products include Korunní in returnable glass bottles, and Leros Cold Brew, an original mix of herbs for the preparation of ice tea.
In June, Kofola completed the certification of Rajecká Dolina as a BIO habitat for free herb harvesting.
At selected Ugo salad bars it launched 'water without packaging', i.e., Rajec spring water on draught.
For the rest of the year, Kofola will focus on developing Ondrášovka and Korunní's potential and consolidating its tea and coffee business.
© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Branislav Pekic. Click subscribe to sign up to ESM: The European Supermarket Magazine.