Thank you for standing by, ladies and gentlemen, and welcome to Coca-Cola HBC's conference call for the 2023 1st quarter trading update. We have with us Mr. Zoran Bogdanovic, Chief Executive Officer, Mr. Ben Almanzar, Chief Financial Officer, and Mr. John Dawson, Head of Investor Relations. At this time, all participants are in listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, please press star one on your telephone keypad at any time and wait until your name is announced. I must also advise that this conference is being recorded today, Wednesday, the 3rd of May, 2023. I now pass the floor to one of your speakers, Mr. John Dawson. Please go ahead.
Thank you, operator, and good morning, everyone. We'll start with some opening remarks from Zoran and then open the floor to your questions. Please keep to one question and a follow-up. We have about an hour for the call today, and that should leave plenty of time for questions and answers. If you need to ask a further question, please re-register with the operator. Finally, I must remind you that this conference call contains various forward-looking statements. These should be considered in conjunction with the cautionary statements in our trading update press release, which we published this morning. With that, I'll turn you over to Zoran.
Thank you, John. Good morning, everyone. Thanks for joining the call. As you will have seen from our trading update today, we have had a good start to 2023. This strong Q1 performance underpins my key messages today. First, our 2025 growth strategy is working, delivering great commercial execution, securing necessary price increases, while also increasing market share and nurturing our deep customer relationships. Second, our portfolio has been instrumental to our success. Our categories with our most widespread focus, sparkling, energy, and coffee, have all performed strongly. Still, driven by water has been impacted in some of our emerging markets by the macroeconomic environment. Third, the good start gives us increased confidence that we are on track for another year of strong performance in 2023. As a result, we are updating our guidance in a positive way, and I'll discuss that at the end of my remarks.
With that, let me get into the detail. We are very pleased with our performance in Q1. A key measure of success has been the effective use of price and mix levers to recover the inflation effects we are seeing in the cost of goods sold. Volumes have remained solid, particularly in established and developing, and we've improved our market share in non-alcoholic ready to drink and sparkling overall. Our exceptional teams, our strong and close partnerships with our customers, and the effectiveness of our combined commercial initiatives with The Coca-Cola Company and other partners have been critical enablers to our success. First quarter organic revenues were up 22.2%, excluding Russia and Ukraine. Including them, group organic revenue growth was 16.2%, again, very strong.
This growth was fueled by an increase of 21% in organic revenue per case, an acceleration from the 16% delivered in 2022 as a whole. This continues to reflect our responsible approach to pricing and mix decisions enhanced by data and insights. It is essential that we always try to provide value to shoppers and customers, balancing premiumization and affordability and ensuring relevant propositions are available for all consumer segments. We are encouraged to see continued market share gains, particularly given the price increases taken over the last 12-18 months. In the first quarter, we've gained 70 basis points of value share in non-alcoholic ready to drink and a further 10 basis points in sparkling on top of the 120 and 170 basis points achieved respectively in 2022.
This reflects the strength of our brand portfolio, effective marketing and the strong commercial offer and execution we bring to our customers. Looking at the performance by category, we can differentiate some of the trends. Please note the following volumes are organic, excluding Russia and Ukraine. Sparkling volumes were up nearly 3%. Within the category, trademark Coke volume grew mid-single digits. This quarter, we prepared for the exciting launch of Jack Daniel's and Coca-Cola in Poland, Ireland and Hungary in Q2 and the relaunch of the adult sparkling Kinley brand in several markets. Energy performance continues to be strong, up nearly 24%, with sustained volume growth across all three regional segments. Within this, Predator is doing very well in Poland and Nigeria, with other markets like Czech, Ireland, Italy and Romania all making strong contributions to the overall energy growth.
We are also making good progress building out the energy category in Egypt. Coffee volumes were up 25%, reflecting good growth across all segments. Costa Coffee continues to make good progress, particularly in the out-of-home channel, as does Caffè Vergnano. Indeed, we are preparing for further rollouts of Caffè Vergnano in Czech and Slovakia in second quarter. Stills volumes fell 11.2%, largely reflecting weakness in water in emerging markets. This masks some strong performances and good activations, particularly in sports drinks with Powerade up 33%, and with premium waters, which performed particularly well in Ireland, Greece and Italy. Turning to some highlights in our segmental performance. Established segment organic sales grew by 20.6% with both good volumes and revenue per case contribution. Volume growth momentum was maintained in all markets, but it was especially strong in Greece, Ireland and Switzerland.
I am particularly pleased with the high single-digit sparkling volume growth and within that mid-teens volume growth of adult sparkling. Strong double-digit growth of all single serve packages reflects well our focus behind driving single serve as an important lever to drive positive mix impact. In the developing segment, organic sales grew by 26%. This was driven by improved revenue per case, also up 26%. Within this positive channel and package mix made a meaningful contribution alongside the cumulative benefit of pricing initiatives taken over the last 12 months. Overall volumes were flat, although sparkling and energy grew well, offset by volume declines in stills. In the emerging segment, we achieved a good overall revenue performance, protected market shares in sparkling and energy, and only saw material volume reductions in stills, particularly water.
We met consumers' needs on affordability and thoughtful pricing and mix, resulting in emerging market organic revenues growing by 9.5% and up nearly 22% excluding Russia and Ukraine. In Nigeria, the team have done a great job of navigating the shortage of banknotes, delivering strong execution that supported value share gains. Energy was particularly strong with strong double-digit volume growth. Integration in Egypt continues to progress well, helping the organization manage the challenging macro environment. We remain very confident that the business will achieve our vision of healthy share gains and improve profitability over the medium term. As you know, our position as the leader in sustainability is an important part of our license to operate.
I'm delighted that for the seventh year running, we've been A-rated by CDP as a supplier engagement leader on climate change for working with our suppliers to cascade the environmental action across our supply chain. We have also been recognized as one of Europe's Climate Leaders in the Financial Times Statista list for the third consecutive year. We continue to invest in projects that drive organic growth and support our journey to net zero. A good example of this is our new returnable glass bottle line in Austria, which will come online in the second quarter. This investment also taps into the funds created by our first green bond issue in 2022. Let me conclude my remarks by commenting on our guidance for 2023 before we open up to questions.
As I said at the beginning of this call, the good start gives us strength and confidence that we are on track for another year of strong performance in 2023. As a result, we continue to believe we will deliver revenue growth above our 5%-6% medium-term guidance range. On EBIT, we are now confident that we will deliver positive organic EBIT growth in 2023 at the top end of our -3% to +3% guidance range. That said, there is no room for complacency and we are mindful of uncertainties ahead and are ready to adapt with well-prepared actions to ensure we deliver our plans if needed. Our Q1 performance demonstrates the good progress we are making towards our vision of being the leading 24/7 beverage partner. Against our five strategic growth pillars, this is of critical importance.
I won't provide a detailed update on strategy now as we look forward to sharing more at our Capital Markets Day in Rome in three weeks time. This will be a highly interactive event for those who can attend, and we look forward to seeing you there. Before I close, I really want to emphasize that this strong performance is down to the continued hard work and dedication of all of our people, to whom I'm very grateful. In addition, I thank all our customers, The Coca-Cola Company, and other partners for their support. Ben and I are now happy to take your questions. Back to you, the operator.
This is the conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one to their touch tone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time.
The first question is from Edward Mundy from Jefferies. Please go ahead.
Morning, Zoran. Morning, Ben. I've got one question, one follow-up. The first is on Russia. Volumes are down 30%, which represents sequential improvement versus the second half of last year, despite the quite tough comp in the first quarter. Are you able to provide a bit more color around sort of numerical distribution of your new local brands within Sparkling and also their respective price points, you know, versus the old Coke brands? The follow-up's really around the guidance. You know, you've got off to a very strong start. You know, pricing is sticking. Portfolio's in good shape. The Coke's environment arguably a little bit more benign. I appreciate the first quarter is a small quarter.
What are the key uncertainties, as you see it, that are holding you back from becoming more optimistic on EBIT growth at this stage?
Morning, Ed. Good morning, Ed. Thank you. Let me start with just a brief note on Russia, where you know very well that from August of last year, we are not producing or selling any of The Coca-Cola Company brands. The team locally has done few extensions within the existing brands, which are performing in line with expectations. I can only say that any distribution level and the overall business is lower where we used to be with the Coca-Cola portfolio. I remind that market there is extremely dynamic with so many new entrants and things that are happening in the market. You know, unpredictability and visibility of how the whole market develops is really not easy.
I think on your question on pricing, it is slightly lower than where the previous portfolio was. On the guidance thing, look, we are very pleased with the Q1 performance, which did come even better than we expected. We are very mindful of the fact that as you said, Ed, yes, it is the smallest quarter, we all know that. We genuinely think it's early in the year.
Given the continued macroeconomic environment, which is really not easy, we do see that in the markets that we already recognized in Q4 of last year, where we do see some signs of consumer pressure, and we called out those markets that, you know, we really need to be mindful how the consumer will react with rollover of the last year pricing and the pricing execution that we are doing in Q1 and the beginning of Q2. It's still so much ahead of us. We are only entering into the pre-season and season, so we are just very mindful that, you know, there is so much still to digest.
Therefore, we really think that, at this point, what we are guiding for is, you know, very real and prudent. Thank you.
Thank you.
The next question is from Sanjeet Aujla from Credit Suisse. Please go ahead. Sanjeet Aujla from Credit Suisse, your microphone is now open.
Oh, hi. Can you hear me now? Hello?
Yeah, yeah, Sanjit, we hear you. We hear you.
Hey. Hey, Zoran, Ben. Hi. A couple from me.
Hey, good morning.
Can you talk a little bit about the competitive landscape on pricing across your major markets? You know, there's a lot of pricing coming in. I appreciate there's a big mix component as well, but would love to get your thoughts on how competitors are responding to that. Secondly, just on some of your emerging markets, in particular Nigeria, Egypt, where there was a lot of caution, I think, going into 2023. Just love to get your assessment of how volumes have evolved there relative to your expectations, you know, particularly given some external shocks there, particularly in Nigeria recently. Thank you.
Thank you, Sanjeet. On the competitive part, I would say that the whole pricing competitive landscape is broadly rational. There are a number of markets where it's good to see that we are all aligned in the way pricing happens. There are a few markets where we are somewhat ahead of the competition, but also there are a couple of markets where we've seen that competitors have been doing faster and moves over bigger magnitude. That all fits very well into our continuous reading, who does what, and how the landscape evolves.
Based on that, I'm very pleased that the team has this very agile approach of adjusting the plans based on the consumer elasticities, but very much also back to your question, what competition does, always making sure that we are not significantly over the range, but also that we are not under the range, you know, not leaving money on the table. On the emerging, on Nigeria and Egypt, first of all, I would highlight that knowing that both countries are having quite challenging macro environment and the whole setup, but both markets have performed in line with the expectations. That means that we have factored in that volume will be under the pressure both in Q1, and we are foreseeing that also for the next quarter or two.
We have confidence how in Egypt the team has been handling and really, very fast, doing so many things last year when, you know, the whole devaluation as well as inflation has happened. The market started this year quite well. Also in Nigeria, in spite of the fact that the whole country has dealt with the flavor of the elections, this time banknotes, the team has done very strong job leveraging on the so well-built capabilities there to sail through the Q1. We do see that from end of March into the April, while there is still negative volume, but we do see some positive trends happening there.
On volume front, to conclude, yes, we know that this is going to be under the pressure, but in both countries, we are very mindful that this is the time where price mix is the leading priority in the way we generate revenue.
Great. If I could just sneak another one in quickly, just on the phasing of the profit growth between H1 and H2, you know, I guess given the strong start in Q1 and the level of pricing landing, is there anything you'd be able to call out on how we should think about H1, H2 phasing on profit growth?
Let me take that one. We've said that our COGS headwinds expectations for this year are likely to be weighted to half one with the potential for some easing in the second half. Also, if we think about comparatives, half one is tougher given how we deliver last year. Therefore, you know, all of that taken in, it's sensible to think that organic growth should be weighted a bit more to the second half.
Great. Thanks, Ben.
The next question is from Mitch Collett from Deutsche Bank. Please go ahead.
Morning, Zoran. Morning, Ben. I'd like to go back to those markets where you're seeing some impact of a tough consumer. I think having through the statement, it sounds like markets you're seeing that are Hungary, Nigeria, and Egypt. Could you comment on what's driving the headwinds within those markets? Are there countries that I've missed, and is it getting better or worse? Then my follow-up would be, can you perhaps comment on what you'd expect for COGS in 2024 based on current spot? I appreciate it's early, but really interested to hear what you have to say. Thank you.
Good morning, Mitch. I'll start with the first one, and then Ben will take the second one. In my answer to Sanjit, I highlighted that Egypt and Nigeria for very evident, quite strong macro challenges that current countries are at the moment going through. Knowing that consumer is not as resilient as European one, that's why this is what drives that dynamic in those two markets. In Europe, we called out before Hungary and Romania. Apart from the inflation that puts pressure on the consumer, those two markets also have one another thing.
In July, Hungary introduced a taxation on a wide range of CPG products, which then triggered additional wave of pricing, not only by us, by everyone in the market. That has put additional burden on the consumer, and it's logical that this would have the effect on the consumer. We have factored that into our plans for 2023. In Romania, a reminder that from January 1, VAT went up by 10 percentage points, so that increased again, the consumer prices, putting additional pressure there. Overall, we expected that there is going to be some continued softness that we do see in the market.
I would call out here another market where we do see also some signs of a consumer slowdown, which is Czech and Slovakia. I'm very pleased that the team has been very flexible in adjusting our course of action based on the variety of plans that we have available. Actually, the whole new price-pack architecture has been launched as we speak, which gives me huge confidence in how the country will how our team will manage through this in the next quarter. Those are the markets that I think are worthwhile highlighting.
All right. Mitch, from the visibility we have today, I would say that the picture is mixed for 2024. Just like this year, we have started to see some relief on key commodities, for example, aluminum and PET.
Actually further inflation in sugar and sweeteners. When we look ahead also at 2024, that picture doesn't look very unchanged from where we can stand right now. That's sort of why, for us, it's absolutely vital that we remain very focused on improving price mix, on hedging strategy and long-term supply contracts, and continuous focus on productivity as we keep on navigating this volatile environment.
Just to clarify, unchanged means sort of flattish rather than the same level of inflation again?
Sorry, I didn't catch that. Can you repeat?
Yeah. I guess given what you said about relief on aluminum and PET, but inflation on sugar and sweeteners, does that equate to unchanged meaning flattish, or does it mean a similar level of inflation year-on-year?
Yeah. Look, we're not providing guidance in 2024 because it's a little bit early. All in all, we would hope that commodities keep on easing.
Okay. Great. Thank you.
The next question is from Andrea Pistacchi from Bank of America. Please go ahead.
Yes. Morning, Zoran and Ben. Two please. First, if I could just follow up please on the cost situation and in particular on sugar. If you're able to share, explain a bit how your contracts are for sugar, how long-term they are, and how hedged you are for 2023 and 2024, and how you're really thinking about covering further, with obviously sugar at high levels at the moment. The second question is, Zoran, on the market share development, 70 basis points value share you're continuing to gain at sort of across your footprint. Are you able to share how trends are or market share trends are developing countries maybe where you're seeing the softer consumer environment?
I think you're gaining in Nigeria, but also in your developing markets and Egypt, how market shares are there? Thank you.
All right. Thanks, Andrea. Let me give you a bit more color on how our hedging picture is. For 2023, we are hedged over 70% on key commodities associated with input costs, and that is more skewed to half one and half two. When you think about your question on contracts, they vary by commodity and by supplier, depending on a number of factors. Generally, it is safe to say that most of our contracts tend to be long term. As we look ahead to 2024, our hedging position now is comparable to where we were last year, and will continue to make inroads in there as the year progresses.
Okay.
Hi, Andrea. On market share, just to say that, on... Well, it's a little bit of a mixed bag and in several of the markets we are gaining share, and in some of them, I want to highlight in line with the expectation. We are slightly losing share like in, I can tell you in Hungary, for example, and in Czech in Sparkling. We anticipated that given that we've done planned price increases in Czech in Q1, we did not have yet new pack price architecture that has been rolled out now.
Also we've seen that there is kind of a pattern that at the beginning of the year, some of the competitive pressures, especially on the depth and intensity of the promotions happen, which we don't follow one-to-one. I reiterate that the fact that in a short term, there is potentially some market share loss that doesn't concern us as we stay the course to do the right things. We look also on the share performance not only on a quarterly basis, but on a full year as well as even on a two-year basis. It's a dynamic play where we juggle, you know, all the elements of value share as well as the volume share, revenue per case volume.
Everything so far, quite frankly is in line with expectations and there has been nothing that came as a surprise.
Thank you.
The next question is from Simon Hales from Citi. Please go ahead.
Thank you. Morning, Zoran. Morning, Ben. Morning, John. A couple from me then. Zoran, I wonder if you could just talk a little bit more about the performance in Russia of the Multon business in the period. Obviously, you're fully consolidating it, but I wonder what you're seeing in terms of underlying trends within that business. A bit more color there would be useful. Secondly, you provided new updated translational FX guidance for this year. How should we think about transactional FX headwinds for 2023 now, please?
Good morning, Simon. Let me start, and then Ben. To build on what I said on Ed's question, business there is performing in line with expectations. Just to say that consumer sentiment also is impacted by everything that's going on. Just to say that business is rewiring in the new model, where this unit is not about pushing performance. This is about really protecting and safeguarding the business for the sake of all people there and assets. In that context, I can say that, you know, the progress has been in line with expectations, of course, on a lower scale than before. That's where we are.
Regarding FX for 2023, we now expect a translational FX impact of 50 million-60 million. That change is reflecting the further evaluation we've seen in currencies like the Ruble, the Naira, and the EGP, as our FX translational guidance is based on spot rates. You rightly remarked, Simon, we also expect some transactional headwinds as a consequence, and they're already captured within our organic EBITDA growth expectations. Given the volatility that we're seeing in our emerging market currencies, these are under constant review, and we're proactively taking the actions, pricing other initiatives in order to protect the P&L.
Got it. Thank you very much.
The next question is from Alicia Forry from Investec. Please go ahead.
Hi. Good morning, Zoran and Ben. Thank you for the question. I wanted to get an update on coffee, which you touched on briefly in your prepared remarks. If you could give us a bit more color on what markets that's in now and the benefits that you are starting to see in your business now that that is maturing a bit. Secondly, my follow-up is on the returnable glass bottle line in Austria. Great to see that coming through. Are there other non-RGB markets where this format might be introduced? Presumably this will be a positive for your margins longer term once the upfront costs are absorbed. If you could comment on that would be great. Thank you.
Thank you, Alicia. I could talk long on coffee given the passion I have for this. To say that... Look, this is a long-term play where we are building our capabilities. We have teams on a group level, on each country where we have launched both Costa and Caffè Vergnano. Meaning that with Costa, we are in some 16-17 markets, and with Vergnano on 13-14, now with Czech and Slovakia. There are a number of elements that through which we are building our right to win. First of all, this blend of portfolio to have it for the mass premium, as we call it, as well as the super premium with Vergnano.
Now with the dual focus of out of home and at home, where out of home is even of a bigger importance. We see a continuous improvement development on share, on our penetration to customers, continuous increase in the HORECA out of home channel, constant increase of number of customers. As a reminder, we are doing this across all channels, all market channels. The impact is that we are not only driving volume, but even more importantly, revenue.
As we are increasing with the scale, on a midterm level, this is of expectation that this is going to be a decent revenue pool, which is also going to start bringing bottom line, absolute as well as the margin over the next several years. We see coffee as an important part, to conclude my remark, one of the three pan-category categories that we have for all the markets, because it is a super relevant, very big sizable, revenue, profitable pool. We believe by a very persistent way of building our capability that we are building a important revenue stream for Hellenic, for the future.
On the RGB Austria, let me just first say that in many of our markets, we already have returnable glass bottles, and that's the key pack for our out of home, out of home channel. With this, what we are doing in Austria, we are actually just further expanding our returnable glass bottle footprint. This really shows a nice example that we started with the pilot importing from Italy, seeing that pilot was positive, then investing in Austria in glass, so that as it is a very relevant tech for this market. Yes, we could see in the future that the whole revival of refillables, we see that as a very positive thing.
Yes, I could see that in the future we will be having more of these kind of investments. I'm very thrilled to conclude to say that this is such a good example of showing investments that support our capacity increase and organic growth, which at the same time fully supports our roadmap to net zero by 40 commitment. Great example of business project which fully embeds inside the sustainability element. Thank you.
The next question is from Jared Dinges, from JP Morgan. Please go ahead.
Hi guys. Can we talk about volumes a bit, you know, maybe in established especially, nothing we've touched on as much yet, but clearly very, very good quarter. Was there any benefits from easy comps there in the on trade or maybe could you give us an idea of underlying growth excluding any of those benefits? Maybe to follow up, how are you guys thinking about volumes at the group level for the year? I think correct me if I'm wrong, I think you said you previously expect volumes to be down organically this year. Is that still the case? Thanks.
Good morning, Jared. Yes. In established, I'm really pleased with how this segment has performed. Some of the markets did not have easy comps like Ireland and Greece, even Italy. Actually at a backdrop of quite solid comps, the markets have performed well. However, there is also element that in this quarter, we had out of home really operating fully as in some markets like Switzerland, Austria last year, we still had some impact of not yet full reopening because of the COVID. There is an element of that in there as well.
But to conclude, I'm quite encouraged with the performance of all countries in this segment. I do continue to expect that they will perform well this year. Now coming to the overall group volume expectation, we do still expect from today's visibility that our volumes would be down slightly for 23 overall, for the reasons I mentioned in the previous answers. Because of the primary focus on price mix, we do expect that volumes will still be slightly down for the year.
Perfect. Thank you.
The next question is from Yubo Mao from Morgan Stanley. Please go ahead.
Morning Zoran, Ben. thanks for taking my question. I just have one on price mix. Obviously, Q1 was remarkably strong across the board. you did 21% at group level. Could you just help us understand the breakdown between price and mix as you helpfully did for the last year? As a follow-up, in some of the pricing, are you now in a position to mostly protect your profitability against the cost inflation regarding to this year, or would you need more rounds of pricing later in the year? Thank you very much.
Thanks, Yubo. Let me start with your first question around, you know, pricing versus mix. As you rightly said, you know, 21% in the quarter, pricing was really the largest contributor there, accounting for about 3/4 of the growth in NSR per case for Q1. As Zoran mentioned earlier, we benefited from pricing actions that we've taken from prior year and also the pricing that we've continued to do now in 2023. When mix, I want to highlight as well because it was a very important driver and all the mix levers, category, package, channel, geography, were accretive in the quarter, Russia and Ukraine excluded. We're very, very pleased with that performance.
Yubo to build on Ben's point, referring to your second part. With the pricing that we are doing in Q1 and Q2, and it is skewed toward the first half. From today's visibility, we believe that we are on a level where we should be. In the context of the profitability, just to remind that there are a number of other things that we are doing. We are quite focused on the mix. That's an important part of the whole RGM play, but also our always agile way of how we are managing costs.
That's very important part. Every year we are having initiatives that are constantly searching for efficiency improvements, productivity improvements, I think it goes without saying that this year is no exception. When we blend that all together, you know, that leaves us with a plan that we have, as I mentioned at the beginning, which should really get us towards the guidance that I mentioned earlier.
Thank you very much.
The next question is from Charlie Higgs from Redburn. Please go ahead.
Yes. Good morning, Zoran, Ben. Hope you're both well. My first one is just on your sparkling volume performance in the quarter. Just wondering if you could give a bit more color there. I mean, the +2.9%. Pretty solid given the comp and the pricing and the sugar taxes. You said trademark Coca-Cola was up mid-single digits. Do you have the volume performance of Coke Zero to hand? Could you maybe just talk a little bit more about adult sparkling and what you're seeing there? It looks like Italy was very strong in the quarter. My follow-up is just on Jack and Coke, where it looks like you launched in a few markets in April. Can you maybe just talk about how you're feeling about that brand this year, particularly given you've had a long-lasting relationship with Brown-Forman ?
Thanks.
Hi, Charlie. Good morning. Sparkling on a group level, and I want to say without Russia and Ukraine so that we talk something that makes sense. Very good performance of Sparkling, on mid-single digits, on Coca-Cola brand and continuous good performance of zero sugar variants. That's excellent. As well as the adult Sparkling. I'm very pleased to see that we continue driving also good growth with Fanta and Sprite. Great work with The Coca-Cola Company team. I have huge confidence about Sparkling category, its potentiality, the pipeline of marketing that is coming to us from the company team, and this whole customer plans and execution.
Sparkling continues to be the bedrock of our business, and gives us huge confidence of performance not only for this year, but many years to come. That's on Sparkling. I think the second one was on Italy.
Jack and Coke.
Jack and Coke. Jack and Coke, look, we are super pleased that we have two such amazing brands coming together in a great tasting product as we have launched now. We have launched in Poland, Hungary and Ireland. First reactions are very positive excitement of the teams or customers, consumer reaction, and I really expect that we will have the rollouts in more markets as we go forward. Italy on adults, this is now focused through Kinley as well as our local brand there, Lurisia, which is in the premium sparkling segment with local flavors.
This is performance of the adults over there in Sparkling is a result of the conscious plans to boost and activate this brand over, you know, multi years. With the relaunch of Kinley that is now coming on stream, this is additional booster. Also with our focus on mixability in the country, this really gives me a good confidence that this is a segment of the market where we have quite a bit of profitable revenue to go after, and I'm sure we will. Does that cover it, Charlie?
Yeah, that's great.
Thank you.
The next question is from Matthew Ford, from BNP Paribas Exane. Please go ahead.
Morning, Zoran. Morning, Ben. Just two quick ones from me, please. Firstly, just on any early Easter impact, several companies across the space have commented here and there this season about an early Easter benefit. I know it's something you've spoken about historically, just wondering if there's any kind of benefit to the quarter there and which markets you saw that in if you did. Just on the follow-up, just on the away from home channel, if you could quantify where you are kind of across the business now versus pre-pandemic levels and if there are any markets where you are kind of materially still behind pre-pandemic levels, where there's potential catch-up in the course to come. Thank you.
Thank you, Matthew. Look, Easter didn't have any significant impact that we would specifically call out. There may have been some of the earlier buy in March because Easter was beginning of April. But nothing really that we would have to call out and that it would be so tangible. On the away from home, yes. Now across all our markets, we are about the pre-pandemic levels. Excluding Russia and Ukraine, our out-of-home grew 9% organically. Particularly I love to call out the established segment where we grew 19%.
That connects with my previous answer that still in Q1 last year we did have some parts where it was not yet fully operating. This year, we are pretty much, where we should be. Yes, we are above the pre-pandemic level.
Great. Thank you.
The next question is from Fintan Ryan, from Goodbody. Please go ahead.
Good morning, Zoran. Good morning, Ben. Just one question from me, please. Actually, I think following on from the Sparkling question you had earlier. With regards to your stills portfolio and particularly waters, you mentioned weakness across all markets. Particularly within some of the emerging markets, what are you putting this down to? Would it be deliberate portfolio actions that you're taking in terms of prioritizing sparkling internally? Or is it a category where you're seeing greater consumer price elasticity or sort of at risk of down trading? Should we expect to see some of these effects continue for the balance of the year within the stills and waters category? Thank you.
Thank you, Fintan. In short, this is about deliberate choice. First of all, we constantly call out that our top priorities are sparkling, energy and coffee. Within stills, together with The Coca-Cola Company, we do this joint prioritization of which categories in which countries we are focusing on, given the relevance, given the relevant profitable pools, et cetera. Coming specifically to water, it is our choice that we do together that we focus on the more premium part of this category. We are not going to, you know, big chunk of the category where it's all about competing on volume, where profitability is very low. Consciously, we focus on the upper segment of that category, therefore we see enhanced water options.
Let me also mention example that where we just launched in Switzerland vitaminwater, which is at a very premium level. Very pleased that we are doing that here in Switzerland. Also example that I mentioned in my remarks, that premium water Lurisia being now introduced in Romania, in Greece, demonstrates exactly that choice that we focus on the more premium segment of this category. If that has as a consequence that in the short term it has some overall volume impact, you know, that's in line with expectations.
Mr. Bogdanovic, there are no more questions registered at this time.
Thank you, operator. Let me just recap the key points from our presentation call today. We've had a good start to 2023 with a strong Q1 performance. Our 2025 growth story is working. Our excellent portfolio, our strong capabilities, and passionate people are key to our success. The good start gives us strength and confidence in our performance. We look forward to seeing many of you in Rome later this month. Thank you all for your attention and all your questions. With that, I close the call and I wish you all a very good day. Thank you.
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