This week Down Under

Turbulence at the top sees Coca-Cola Amatil shed Australian drinks MD

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The head of Coca-Cola Amatil’s Australian beverages division has become one of five boardroom casualties as the group reacts to a near-40% drop in profit.

Managing director Barry O’Connell will leave after 20 years at various global Coca-Cola businesses, and four years leading its drinks operation in Australia.

In its 2016 financial year report last month, O’Connell’s division reported a drop in earnings of 1.8% to A$455.3m. Moreover, CCA’s total group profits plunged by 37.4% to A$246.1m. Its chairman and three directors also announced they would retire in May. 

The erstwhile managing director will be replaced by an interim executive, Peter McLoughlin, until a replacement is appointed. The decision for O’Connell to leave was mutual, according to a CCA spokesperson.

The Australian bottler, one of the Coca-Cola’s five biggest, has been hit hard by recent consumer trends away from sweetened drinks, though its chief claims that through O’Connell’s efforts to diversify, the slump is only temporary.

"Over the last three years, Barry has built a strong foundation for our Australian Beverages business through his leadership of our transformation program and focus on rebalancing our portfolio to deliver a sustainable business for tomorrow," Coca-Cola Amatil group managing director Alison Watkins said in a statement.

Besides its slump in soft drink sales, CCA is also looking to stave off the threat of stagnating beer sales in Australia by backing a new team of beer and cider experts. These specialists, its hopes, will “build the foundations of our long-term beer and cider growth strategy,” the company said in a statement.

The Beer and Cider Exchange, which opened last week, consists of 14 specialist beer and cider merchants, each of whom will provide support to the trade and CCA’s state sales teams.

Following the addition of the Miller brands to its premium beer portfolio late last year, Amatil has leveraged its relationship with Molson Coors International to develop a bespoke premium beer and cider strategy for the Australian market. This has been modelled on the successful Tenth and Blake Beer Company, the craft and import division of the US-based MillerCoors.

Amatil’s director of beer and cider, Judd Michel, set up the team. He said: “Premium beer consumers expect good-quality beer, with top-class service. We need to work with the right venues, the right beers, perfectly served and expertly activated.

"From our research of MillerCoors this specialisation strategy works. We've got some great beer and cider brands in our portfolio and we believe this approach is the right way to build brands and drive long- term success in the Australian market," he added.

The team will work closely with the Molson Coors brands Miller Genuine Draft, Miller Chill, Coors and Blue Moon, as well as Amatil’s other brand partners, including Angry Orchard, Rekorderlig and Pressman’s cider, and Yenda and Sam Adams craft beers.

 

More stories from Down Under…

Canberra plans four new research centres

The Australian government will build four new centres dedicated to research into food, farming, honey and logistics.

These co-operative research centres (CRCs) will each receive between A$7m and A$55m in funding over 10 years.

The farming centre, which will focus on high-performance soils, will use A$40m of funding to bridge the gap between soil science and farm management. The A$7m honey bee CRC, meanwhile, will help find links between unique floral hive sites to product quality control processes. 

The food agility CRC will be dedicated to the “digital transformation of the Australian food industry”, and will receive A$50m in funding from the government, while the “iMove” logistics CRC will receive the most funding to explore digital and evolving vehicle technologies to help traffic flow.

I’m delighted that the new CRCs will involve interdisciplinary researchers working with industry to explore new processes, including digital technologies, to deliver improvements in strategic industry sectors,” said Arthur Sinodinos, ,minister for industry, innovation and science. 

Sinodinos said that the ongoing cooperative research centres programme was a “competitive, merit-based grant programme that supports industry-led and outcome-focused collaborative research partnerships between industry, researchers and the community”.

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