Coca-Cola bottom-line still safe

The closure of two production lines at the Coca-Cola Namibia Bottling Company (CCNBC), in response to the mandatory 30% water savings in June, will not impact the bottom-line of the company at this stage.This week, CCNBC Managing Director Frik Oosthuizen said while the production cuts could lead to a 30% decline in production, “we do not plan to lower our full-year financial bottom-line and forecast at this stage”.Nevertheless, he added that “efficiencies” of the remaining production lines will be affected, as fixed costs will remain unchanged. In addition, he confirmed that 40 to 60 jobs are on the line as a result of the production cutbacks, but emphasised that “there will be no involuntary retrenchments”.The agreed reduction in water usage, according to fixed targets, has been slated for 1 June, Oosthuizen explained, following meetings with City of Windhoek officials, although the company has with immediate effect, closed two production lines as reported previously.He said the water usage targets set for the company are based on average water usage over the past three years, and as a result of the fact that CCNBC works in line with global standards of efficient water use during production, the mandatory water targets means the company can “theoretically… only produce 30% less than before”.He said that in anticipation of the water restrictions, the CCNBC has ensured that “ample stock” is on hand.He cautioned, however, that once the water restriction date arrives in June, “the picture may change”. According to Oosthuizen, thousands of small to large businesses, including individuals, could be affected by supply disruptions to different degrees. In particular, he pointed out that “many households depend, from a small to a very large degree, on the selling of our products”.Nevertheless, the company is committed to explore alternative water supply sources and to “minimise” the impact on customers and businesses, he said. CCNBC is starting borehole drilling shortly, Oosthuizen said, but cautioned that this “will only partly solve the problem”.The company is also investigating other possible fixes, but Oosthuizen could not elaborate at this stage. He added that there is currently no comprehensive quick-fix to address the 30% cut in water supply, apart from sufficient rainfall. Moreover, he highlighted the critical role that the relevant authorities can play by ensuring infrastructure upgrades, in order to ensure improved water supply and to enable growth. Apart from focusing on short-term solutions, Oosthuizen said the CCNBC has “embarked on a major project in evaluating alternative areas for future expansion”.He added that the worst case scenario is “possible total relocation of the business to elsewhere in Namibia, due to increased water requirements for growth in the future.”JANA-MARI SMITH

Coca-Cola bottom-line still safe

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Namibian Sun 2025-05-05

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Coca-Cola bottom-line still safe

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Namibian Sun 2025-05-05

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