Coca-Cola Enterprises Inc. Reports First-Quarter 2008 Results

Atlanta, Apr. 24 - Coca-Cola Enterprises today reported first-quarter 2008 net income of $8 million, or 2 cents per diluted share. After adjusting for items affecting comparability, including restructuring charges, net income totaled $38 million, or 8 cents per diluted share.

The following table reconciles reported and comparable earnings per share:

Key operating factors in the first quarter include softer than expected volume in North American single-serve packages, particularly in sparkling beverages and Dasani, continued European operating improvement, and the benefits of restructuring programs and operating expense initiatives.

As a result of these factors, total revenues grew 7 percent as consolidated comparable volume was up 1½ percent with currency-neutral pricing growth of 4 percent. Consolidated comparable operating income decreased 10½ percent, while on a segment basis, comparable North American operating income declined approximately 32 percent and comparable European operating income rose 31 percent. Comparable EPS results reflect a benefit from currency translation of approximately 1 cent. Pages 8 through 10 of this release provide a reconciliation of reported and comparable operating results.

“While weakness in North America’s economic environment tempered our first quarter results, we remain focused on executing against our three strategic objectives, ensuring the continued success of our restructuring programs, and controlling our operating expenses,” said John F. Brock, chairman and chief executive officer. “We continue to believe that our operating and brand initiatives, coupled with the outstanding marketplace execution generated by our skilled, dedicated work force, will create increasing levels of growth.”

In the first quarter, North American physical case bottle and can volume was flat while net pricing per case was up 4½ percent, and cost of sales per case grew 9 percent. These results reflect the mix impact of the expanded still beverage portfolio. Pricing and cost of sales growth statistics are comparable and exclude the effects of currency translation.

Europe achieved strong volume growth of 7 percent, including 11 percent in Great Britain and 4 percent on the continent, reflecting sales growth in sparkling and still beverages. Net pricing per case grew 1 percent.

“We believe positive topline trends in Europe, coupled with the improvement generated by North American operating and brand initiatives, will enable us to achieve solid earnings growth,” Mr. Brock said. “As we work to achieve this target, it is important that we respond to the marketplace challenges created by the current North American economic environment. We are working quickly and aggressively with The Coca-Cola Company on specific strategies that will strengthen our ability to deliver against our objectives.”

FULL-YEAR 2008 OUTLOOK

For the full year, CCE expects EPS performance in a range of $1.50 to $1.55. The company also expects return on invested capital to improve in line with the long-term goal of 30 basis points or more of annual improvement, strong free cash flow (cash flow from operations less capital spending, net of asset disposal) of more than $700 million, and capital expenditures of approximately $1 billion. The effective tax rate for 2008 is expected to be approximately 28 percent. Guidance excludes items affecting comparability and includes expected currency translation impact.