Shareholders hope things go better for Coke The reason for Coke's recent financial deterioration is an escalating cola war with perennial underdog Pepsi. IT appears even dividends go better with Coke, with the local bottler adding a 2.5c a share unfranked special dividend to its 75 per cent franked, 24c a share interim dividend. The bizarre thing is that the extra shareholder returns are coming at a time when Coca-Cola Amatil is actually struggling to make headway in most of its markets, leading to a lower profit, revenue and just about every other measure you care to mention. Indeed the total dividend of 26.5c a share is perilously close to its 28.3c earnings per share after significant items, which will keep the pressure on to turn the business around just to hold shareholder payments steady. The reason for Coke's recent financial deterioration is an escalating cola war with perennial underdog Pepsi, which launched its Pepsi Next in a blitz of publicity and discounted prices. That made Coke suddenly look very expensive and led to many supermarkets slowing down their Coke orders as sales fell, particularly when compared to the previous year's government stimulus program which apparently prompted a secondary wave of stimulus through a higher caffeine intake. There wasn't a lot of joy elsewhere in the Coke result with spending but no revenue yet from the new beer and cider launches later this year and continued restructuring for SPC Ardmona as the fruit and vegetable business struggled against cheap imports sucked in by the high dollar. The only real bright spot in Coke's result is Indonesia, where they seem to be slurping down the fizz as fast as they can bottle it with sales and profits jumping 15 per cent. Not surprisingly Coke are rolling out a further 60,000 drink coolers there this year, so Indonesia looks like growing for some time to come. It may seem counter-intuitive but I think the only way the Coke board would have given the nod to a special dividend is that they are supremely confident of a strong comeback on the Australian supermarket shelves in the lead up to summer and a more generalised recovery as well. A speculative buy. If you are looking for a company that is pulling itself up by its own bootstraps, it is hard to go past Ansell. The protective clothing and condom maker has been highly successful at globalising itself and the runs are really starting to stack up as this year's four acquisitions are seamlessly integrated into its very lean manufacturing culture. That has allowed Ansell to make its own luck even in largely flat world markets for its products, with sales up 10 per cent to $1.3 billion and net profit firming 5 per cent to $136.8 million. It is now heavily exposed to emerging markets such as Russia, China, India, South East Asia, the Middle East, Africa, Latin America and Eastern Europe with sales in most of those growing at double digits. Australia has shrunk to represent just 6 per cent of sales and offshore institutions are now common on the Ansell share register, which is why the company is moving to US dollar accounting. Ansell's aim is to have the number one or two product wherever it is sold and it has really ramped up the number of new product launches. Another clever innovation is to diversify its raw materials away from natural latex which has cut costs and problems with latex sensitivity. Its sexual wellness division - condoms, for the uninitiated - is also innovating with the successful international launch of the skyns range continuing. In most of Ansell's markets it faces headwinds in the form of poor economies, lower defence and medical spending and adverse currency movements but this is one stock that will always look expensive but is still a buy based on its ability to innovate itself out of trouble and keep growing.