Coca-Cola Amatil struggling in Indonesia


Coca-Cola Amatil (OTCPK:CCLAY) is facing a serious profit squeeze in Indonesia with currency swings and higher costs significant factors.

The company is also spending heavily in the nation in an effort to boost the Coke brand.

YTD earnings from Amatil's Indonesia and Papua New Guinea division are off 80% YTD.

Coca-Cola (NYSE:KO) has a 29% stake in the Australian soft drinks concern.

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Comments (1)
  • dectra
    , contributor
    Comments (649) | Send Message
     
    Tough environment to deal with currency swings; emerging markets currencies are cyclical and when they move, it's usually quick.

     

    Companies can try to hedge if they find it impossible to adapt their pricing as quickly as the currency moves, but many find it expensive and impractical as they try to quickly protect against fluctuations in volatile and relatively illiquid emerging markets currencies.
    21 Aug 2014, 07:49 AM Reply Like
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