Coca-Cola hit by fizzing demand Coca-Cola Amatil is the latest discretionary business to fall foul of weaker than expected consumer demand following the federal election and has said this morning it expects its full-year pre-tax earnings to slide by between 5 to 7 per cent calendar 2013. Shares dropped 3.7 per cent to $12.41 in early trade. "The non-grocery business has continued to grow volumes in the second half, however, consumer demand has been more subdued than expected," managing director Terry Davis said in a statement to the Australian Securities Exchange on the company's November trading update. While we have seen some improved momentum in the Australian grocery channel, with carbonated beverages returning to growth and an improvement in market share, the aggressive competitor pricing activity has continued which has limited price realisation in the half to date. But it was consumer demand post the election that was disappointing and lower than expected, he said. A number of retailers have come out in the last few weeks to comment that hopes of a significant and sustained jump in consumer confidence and spending since last month's federal election had been dashed, with any spike in retail sales short lived. This month Richard Goyder, the boss of Wesfarmers which owns Coles, Bunnings, Target and other retail banner groups, said consumer spending had bounced a bit but returned to pre-election lows. Woolworths boss Grant O'Brien said last week he hadn't witnessed any gain in consumer spending yet. Coca-Cola Amatil said in the wake of the continued lull in consumer spending the company was forecasting a 5-7 per cent decline in full-year EBIT for its 2013 year with the lower earnings also driven by more aggressive competitor activity as well as an estimated impact of almost 1 per cent to group earnings due to the weaker Indonesian Rupiah and PNG Kina. Coca-Cola Amatil, which has a large soft drinks operation in Indonesia, also said this morning that third quarter demand had slowed during the third quarter in the Asian country as the economy adjusted to higher levels of inflation which has impacted consumer spending. The fundamentals drivers of increased consumption per capita of commercial beverages remain strong and for 2013 we would expect the Indonesian business to deliver low double-digit volume growth and earnings growth. In calendar 2012 Coca-Cola Amatil's Indonesian and PNG business recorded volume growth of 10.3 per cent and EBIT growth of 16.8 per cent. Coca-Cola Amatil said its alcohol, food and services division, which covers its local spirits operation, SPC Ardmona, coffee and water beverages, was trading in line with expectations. As part of its re-entry into the Australian beer market after a two year exclusion, Coca-Cola Amatil said it had signed a long-term exclusive deal to distribute US craft beer, Samuel Adams, in Australia from mid-December. "With just over a month left until CCA re-enters the beer and cider market in Australia, we are ready to hit the ground running with a great portfolio of beer and cider brands," Mr Davis said. Our line-up will include the Molson Coors premium beers including Blue Moon and Coors and a full range of Rekorderlig ciders in both bottled and draught from January 2014. The company said it was still searching for a successor to Mr Davis who plans to step down from the CEO role at the end of August next year.