ANDLAUER HEALTHCARE GROUP PROVIDES UPDATE ON APPROVALS FOR SALE TO UPS
The Company expects the Arrangement to be completed in the second half of this year, subject to receipt of approval under the Competition Act (Canada), which process remains ongoing, and the satisfaction or waiver of the other customary closing conditions. All other regulatory clearances and approvals required to consummate the Arrangement have been obtained.
In addition, the Qualifying Holdco Election Date (as defined the Company's management information circular dated May 20, 2025 (the " Circular")) for shareholders wishing to exercise the Qualifying Holdco Alternative (as defined in the Circular) is July 17, 2025. Please refer to the Circular for more details regarding the Qualifying Holdco Alternative.
Further details regarding the Arrangement, including with respect to the applicable regulatory clearances and approvals, are set out in the Circular and the news release of the Company dated April 24, 2025, each of which are available under AHG's SEDAR+ profile at www.sedarplus.ca.
About AHG
AHG is a leading and growing supply chain management company offering a robust platform of customized third-party logistics (" 3PL") and specialized transportation solutions for the healthcare sector. The Company's 3PL services include customized logistics, distribution and packaging solutions for healthcare manufacturers across Canada. AHG's specialized transportation services in Canada, including air freight forwarding, ground transportation, dedicated delivery and last mile services, provide a one-stop shop for clients' healthcare transportation needs. Through its complementary service offerings, available across a coast-to-coast distribution network, AHG strives to accommodate the full range of its clients' specialized supply chain needs on an integrated and efficient basis. The Company also provides specialized ground transportation services, primarily to the healthcare sector, across the 48 contiguous U.S. states. For more information on AHG, please visit: www.andlauerhealthcare.com.
Forward-Looking Information
This press release contains "forward-looking information" and "forward-looking statements" (collectively, " forward-looking information") within the meaning of applicable securities laws. In some cases, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "targets", "expects", "is expected", "an opportunity exists", "budget", "scheduled", "estimates", "outlook", "forecasts", "projects", "projection", "prospects", "strategy", "intends", "anticipates", "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or, "will", "occur" or "be achieved", and similar words or the negative of these terms and similar terminology. In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking information.
Specifically, statements regarding the proposed timing and completion of the Arrangement, the proposed receipt of regulatory approvals, and other statements that are not statements of historical facts are all considered to be forward-looking information.
Statements containing forward-looking information are not historical facts but instead represent management's expectations, estimates and projections regarding future events or circumstances. This forward-looking information is based on our opinions, estimates and assumptions that, while considered by the Company to be appropriate and reasonable as of the date of this press release, are subject to known and unknown risks, uncertainties, and other factors that may cause the actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to: the risk that the Arrangement will not be completed on the terms and conditions, or on the timing, currently contemplated; that the Arrangement may not be completed at all, due to a failure to obtain or satisfy, in a timely manner or otherwise, required regulatory approvals or clearances and other conditions to the closing of the Arrangement or for other reasons; the possibility of litigation relating to the Arrangement; credit, market, currency, operational, liquidity and funding risks generally and relating specifically to the Arrangement, including changes in economic conditions, interest rates or tax rates; and those other risks discussed in greater detail under the "Risk Factors" section of our Annual Information Form which is available under our profile on SEDAR+ at www.sedarplus.ca. If any of these risks or uncertainties materialize, or if the opinions, estimates or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking information. Although we have attempted to identify important risk factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other risk factors not presently known to us or that we presently believe are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking information.
There can be no assurance that forward-looking statements will prove to be accurate as actual outcomes and results may differ materially from those expressed in forward-looking statements included herein. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, any forward-looking statements included herein are made as of the date of this news release and, except as expressly required by applicable law, AHG assumes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
All of the forward-looking information contained in this press release is expressly qualified by the foregoing cautionary statements.
SOURCE Andlauer Healthcare Group Inc.
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Through the Eurobond issuance at the beginning of the year, we secured the financing required for the 5G auction in advance and on favorable terms. On the other hand, we distributed the first installment of dividends to our shareholders on June 20, 2025. Excluding FX swap transactions, 65% of our cash is in US$, 22% in EUR, 3% in CNY, and 9% in TRY. Consolidated debt as of June 30, 2025, increased to TRY172,858 million from TRY121,738 million as of December 31, 2024. Note that TRY14,320 million of our consolidated debt comprises lease obligations. Additionally, 57% of our consolidated debt is in US$, 26% in EUR, 4% in CNY, and 12% in TRY. Net debt 1, as of June 30, 2025, increased to TRY25,371 million from TRY12,497 million as of December 31, 2024, with a net debt to EBITDA ratio of 0.29x. Turkcell Group had a short net FX position of US$102 million at the end of this quarter (this figure takes hedging portfolio, advance payments and precious metal investments into account). The short FX position of US$102 million is in line with our FX neutral definition, which ranges from -US$200 million to +US$200 million. Capital expenditures: Capital expenditures (CAPEX) amounted to TRY40,560 million in the first half of the year, with TRY24,231 million recorded in the second quarter. Operational capital expenditures (excluding license fees) accounted for 16.9% and 18.5% of total revenues in Q225 and H125, respectively. Capital expenditures (million TRY) Half Year H124 H125 Operational Capex 19,447.5 19,217.8 License and Related Costs 18.6 219.5 Non-operational Capex (Including IFRS15 & IFRS16) 8,440.2 21,123.1 IFRS15 4,972.4 4,826.8 IFRS16 3,358.8 12,957.7 Other 109.1 3,338.6 Total Capex 27,906.3 40,560.4 (1) Our net debt calculation includes financial assets at fair value, whether through other comprehensive income or through profit and loss, reported under current and non-current assets, as well as financial assets at amortized cost. Required reserves held in CBRT balances are not included in total cash and net debt calculation, and this change has been reflected in previous quarters' figures Operational Review of Turkcell Türkiye Summary of Operational Data Quarters Q224 Q125 Q225 y/y % q/q % Number of subscribers 1 (million) 43.2 43.1 43.5 0.7% 0.9% Mobile Postpaid (million) 28.1 29.3 30.1 7.1% 2.7% Mobile M2M (million) 4.7 5.3 5.4 14.9% 1.9% Mobile Prepaid (million) 10.4 9.0 8.7 (16.3%) (3.3%) Turkcell Fiber 2 (thousand) 2,375.6 2,484.4 2,488.2 4.7% 0.2% Resell Fixed Broadband 2 (thousand) 810.6 774.2 763.3 (5.8%) (1.4%) ADSL (thousand) 767.8 721.8 695.9 (9.4%) (3.6%) Cable (thousand) 38.1 33.1 31.3 (17.8%) (5.4%) Fiber (thousand) 4.7 19.3 36.0 666.0% 86.5% Superbox 3 (thousand) 746.4 660.0 654.9 (12.3%) (0.8%) IPTV (thousand) 1,484.4 1,456.3 1,430.0 (3.7%) (1.8%) Churn (%) 4 Mobile Churn (%) 1.5% 1.7% 2.2% 0.7pp 0.5pp Fixed Churn (%) 1.2% 1.4% 1.7% 0.5pp 0.3pp Average mobile data usage per user (GB/user) 18.6 17.9 19.2 3.2% 7.3% (1) Includes mobile, fixed broadband, IPTV, and wholesale (MVNO&FVNO) subscribers (2) As of the fourth quarter of 2024, our fixed broadband subscriber reporting has been revised. Turkcell Fiber refers to customers served entirely through our own fiber infrastructure, while Turkcell Resell includes DSL, Cable, and Fiber sales provided through the infrastructures of other ISPs. Accordingly, historical subscriber figures have been revised to ensure comparability. (3) Superbox subscribers are included in mobile subscribers. (4) Churn figures represent average monthly churn for the respective periods. ARPU (Average Monthly Revenue per User) (TRY, IAS29 Adjusted) Quarters Q224 Q125 Q225 y/y % q/q % Mobile ARPU, blended 283.6 301.0 306.4 8.0% 1.8% Mobile ARPU, blended (excluding M2M) 320.9 344.6 352.5 9.8% 2.3% Postpaid 326.1 346.7 350.5 7.5% 1.1% Postpaid (excluding M2M) 388.8 416.5 423.0 8.8% 1.6% Prepaid 170.2 155.5 158.1 (7.1%) 1.7% Fixed Residential ARPU, blended 350.8 394.1 414.7 18.2% 5.2% Residential Fiber ARPU 355.8 399.7 418.2 17.5% 4.6% As the market leader in the mobile segment, our primary objective is to sustain our strong market position. To this end, we adopt a dynamic and tailored approach to subscriber portfolio management by diversifying our value-added tariffs in line with evolving customer needs. This strategic focus drives robust net additions, reinforcing our industry leadership and contributes ARPU growth as well. As a consequence of this strategy, we managed to add 816 thousand postpaid subscribers, marking our strongest performance in over five years. The share of postpaid subscribers in the total mobile subscriber base has thus reached 78%, representing an annual increase of five percentage points. As expected, the prepaid subscriber base declined to 8.7 million, primarily due to the rise of alternative data solutions and a customer shift toward postpaid plans in response to inflationary pressures. Our mobile churn rate increased to 2.2% this quarter due to high volatility in the mobile number portability market, which reached a record-high volume of 5.0 million transactions. Mobile ARPU (excluding M2M) recorded a 9.8% year-over-year increase, driven by price adjustments, successful upselling initiatives, and the notable expansion of our postpaid base, which grew by 2.0 million over the past 12 months. On the fixed side, our resell fiber base grew by 17 thousand during the quarter, largely driven by the launch of fiber services over the incumbent operator's infrastructure earlier this year. Turkcell Fiber recorded a net addition of 4 thousand subscribers. However, a decline of 26 thousand ADSL subscribers, resulting from our profitability-driven approach in the resell segment, offset the total fiber net additions. Consequently, our fixed subscriber base remained broadly stable at 3.3 million as of the end of Q2 2025. Residential fiber ARPU rose by 17.5% year-over-year, fueled by the growing share of high-speed packages, a higher proportion of 12-month contracted subscribers, and price adjustments. The share of high-speed packages (100 Mbps and above) increased by 16 percentage points year-over-year this quarter. As part of our ongoing efforts to expand our fiber footprint, we added 67 thousand new homepasses this quarter, bringing the total number of pure fiber homepasses to 6.1 million. TECHFIN Paycell sustained its role as the primary growth engine of the Techfin segment this quarter, delivering 35.8% year-on-year revenue growth, driven primarily by the POS business. POS services recorded 149% revenue growth fueled by rising transaction volumes and the onboarding of new merchants. Notably, 74% of Paycell's revenues were generated from non-group clients, underscoring its growing success beyond the group ecosystem. Regarding profitability, the increasing share of POS within the revenue mix led to a decline in the EBITDA margin — a trend that was anticipated given the nature of the business model. Unlike many other payment companies, Paycell remains profitable and continues to record a solid EBITDA margin by industry standards. The total transaction volume reached TRY39 billion in the second quarter of 2025, increasing by 75% year-on-year. POS volumes grew by 121%, driving the overall volume increase. Financell sustained its positive revenue growth performance of 4.7%, despite tight monetary conditions and TRY20,000 limit on 12-month installment plans for smart phones. Key contributors to this growth were a higher average interest rate across the loan portfolio compared to the previous year and the implementation of tailored pricing offers. The EBITDA margin increased by 1.4pp to 15.5% in this quarter due mainly to lower funding costs on a yearly basis. Financell's loan portfolio reached TRY7.3 billion in Q225. By the end of the second quarter, the company had 0.7 million active customers. Financell is the market leader in the consumer financing sector, holding a 52% market share 1 by number of loans. (1) Source: Association of Financial Instuitions, as of Q125 TURKCELL GROUP SUBSCRIBERS As of June 30, 2025, the Turkcell Group had approximately 45.6 million registered subscribers. This figure is calculated by taking the number of subscribers of Turkcell Türkiye and of each of our subsidiaries. It includes the total number of mobile, fiber, ADSL, cable and IPTV subscribers of Turkcell Türkiye, as well as the mobile subscribers of BeST and Kuzey Kıbrıs Turkcell. (1) Subscribers to more than one service are counted separately for each service. This includes mobile, fixed broadband, IPTV, and wholesale (MVNO&FVNO) subscribers. The foreign exchange rates used in our financial reporting, along with certain macroeconomic indicators, are presented below. RECONCILIATION OF NON-GAAP FINANCIAL MEASUREMENTS: We believe that Adjusted EBITDA, among other key metrics, facilitates performance comparisons from period to period and aids management decision making. It also enables performance comparisons between companies. As a performance measure, Adjusted EBITDA eliminates potential differences caused by variations in capital structures (affecting interest expense), tax positions (such as the impact of changes in effective tax rates on periods or companies) and the age and book depreciation of tangible and intangible assets (affecting relative depreciation and amortization expenses). We also present Adjusted EBITDA because we believe it is frequently used by securities analysts, investors and other interested parties in evaluating the performance of other mobile operators in the telecommunications industry in Europe, many of which present Adjusted EBITDA when reporting their results. Our Adjusted EBITDA definition includes Revenue, Cost of Revenue excluding depreciation and amortization, Selling and Marketing expenses, Administrative expenses and Net impairment losses on financial and contract assets, but excludes finance income and expense, other operating income and expense, investment activity income and expense, share of profit of equity accounted investees and minority interest. Nevertheless, Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation from, or as a substitute for, analysis of our results of operations, as reported under IFRS. The following table provides a reconciliation of Adjusted EBITDA, as calculated using financial data prepared in accordance with IFRS to net profit, which we believe is the most directly comparable financial measure calculated and presented in accordance with IFRS. Turkcell Group (million TRY) Quarter Half Year Q224 Q225 y/y% H124 H125 y/y% Consolidated profit before minority interest 3,920.5 4,200.5 7.1% 7,769.5 7,467.8 (3.9%) Profit /(loss) from discontinued operations 713.2 (187.4) (126.3%) 1,504.7 (187.4) (112.5%) Income tax expense 209.4 (1,690.1) (907.1%) (1,723.7) (5,357.6) 210.8% Consolidated profit before income tax & minority interest 2,997.9 6,078.1 102.7% 7,988.5 13,012.8 62.9% Share of loss of equity accounted investees (1,028.9) (1,204.2) 17.0% (1,110.8) (2,120.1) 90.9% Finance income 2,122.2 2,891.5 36.3% 5,522.4 7,085.3 28.3% Finance costs (5,759.9) (5,058.9) (12.2%) (12,800.8) (10,648.7) (16.8%) Monetary gain / (loss) 1,626.2 826.1 (49.2%) 5,502.3 1,842.6 (66.5%) Other income / (expenses) (283.6) (194.5) (31.4%) (603.3) (671.2) 11.3% EBIT 6,321.9 8,817.9 39.5% 11,478.7 17,524.8 52.7% Depreciation and amortization (13,782.6) (14,267.8) 3.5% (27,298.0) (27,779.0) 1.8% Adjusted EBITDA 20,104.6 23,085.8 14.8% 38,776.7 45,303.9 16.8% RECONCILIATION OF ARPU: ARPU is an operational metric and the methodology for calculating performance measures such as ARPU varies substantially among operators. It is not standardized across the telecommunications industry; thus, reported performance measures vary from those that may result from using a single methodology. Management believes this metric is helpful in assessing the development of our services over time. The following table shows the reconciliation of Turkcell Türkiye revenues to such revenues included in the ARPU calculations for Q224 and Q225. Reconciliation of ARPU Q224 Q225 Turkcell Türkiye Revenue (million TRY) 43,143.2 48,219.8 Telecommunication services revenue 39,554.1 43,553.7 Equipment revenue 2,961.9 4,153.9 Other 627.2 512.2 Revenues not attributed to ARPU calculation 1 (6,838.6) (8,640.4) Turkcell Türkiye revenues included in ARPU calculation 2 35,677.4 39,067.1 Mobile blended ARPU (TRY) 283.6 306.4 Average number of mobile subscribers during the year (million) 38.4 38.4 Fixed residential ARPU (TRY) 350.8 414.7 Average number of fixed residential subscribers during the year (million) 2.9 3.0 (1) Revenue from fixed corporate and wholesale business; digital business sales, tower business, and other non-subscriber-based revenues (2) Revenues from Turkcell Türkiye included in ARPU calculation comprise telecommunication services revenue, equipment revenue, and revenues not attributed to ARPU calculation. ABOUT TURKCELL: Turkcell, headquartered in Türkiye, is a leading technology and telecommunications company offering a diverse portfolio of voice, data, and IPTV services across its mobile and fixed networks, alongside digital consumer, enterprise, and techfin solutions. The Turkcell Group operates in three countries: Türkiye, Belarus, and Northern Cyprus. In Q225, Turkcell Group reported revenue of TRY53.0 billion, with total assets of TRY457.4 billion as of June 30, 2025. Listed on both the NYSE and BIST since July 2000, Turkcell remains the only dual-listed company on these exchanges. Read more at Appendix A – Tables Table: Net Foreign Exchange Gain and Loss Details Table: Income Tax Expense Details Million TRY Quarter Half Year Q224 Q225 y/y% H124 H125 y/y% Current tax expense (151.2) (3,667.4) 2,325.5% (216.7) (4,327.6) 1,897.0% Deferred tax income / (expense) 360.6 1,977.2 448.3% (1,507.0) (1,030.1) (31.6%) Income tax expense 209.4 (1,690.1) (907.1%) (1,723.7) (5,357.6) 210.8% TURKCELL İLETİŞİM HİZMETLERİ A.Ş IFRS SELECTED FINANCIALS (TRY Million) Half Ended Half Ended Quarter Ended Quarter Ended June 30 June 30 June 30 June 30 2025 2024 2025 2024 Consolidated Statement of Operations Data Turkcell Turkey 94,357.5 84,469.3 48,219.8 43,143.2 Fintech 5,827.8 4,584.2 2,916.3 2,369.4 Other 3,680.2 3,220.4 1,885.9 1,637.5 Total revenue 103,865.5 92,273.9 53,021.9 47,150.2 Total cost of revenue (74,981.6) (71,223.1) (38,579.1) (35,823.7) Total gross profit 28,884.0 21,050.8 14,442.8 11,326.5 Administrative expenses (4,095.9) (3,317.0) (1,975.4) (1,617.2) Selling & marketing expenses (6,749.5) (5,621.4) (3,341.5) (3,047.8) Other Income / (Expense) (671.2) (603.3) (194.5) (283.6) Net impairment loses on financial and contract assets (513.7) (633.7) (308.0) (339.5) Operating profit 16,853.7 10,875.4 8,623.4 6,038.3 Finance costs (10,648.7) (12,800.8) (5,058.9) (5,759.9) Finance income 7,085.3 5,522.4 2,891.5 2,122.2 Monetary gain (loss) 1,842.6 5,502.3 826.1 1,626.2 Share of loss of equity accounted investees (2,120.1) (1,110.8) (1,204.2) (1,028.9) Profit before income tax from continuing operations 13,012.8 7,988.5 6,078.1 2,997.9 Income tax income/ (expense) (5,357.6) (1,723.7) (1,690.1) 209.4 Profit for the year from continuing operations 7,655.2 6,264.8 4,387.9 3,207.3 Profit /(loss) from discontinued operations (187.4) 1,504.7 (187.4) 713.2 Profit for the year 7,467.8 7,769.5 4,200.5 3,920.5 Non-controlling interests - (9.7) - (1.8) Owners of the Company 7,467.8 7,779.2 4,200.5 3,922.3 Basic and diluted earnings per share for profit attributable to owners of the Company (in full TL) 3.43 3.57 1.93 1.80 Basic and diluted earnings per share for profit from continuing operations attributable to owners of the Company (in full TL) 3.51 2.88 2.01 1.47 Other Financial Data Gross margin 27.8% 22.8% 27.2% 24.0% EBITDA(*) 45,303.9 38,776.7 23,085.8 20,104.6 Total Capex 40,560.4 27,906.3 24,231.4 14,777.8 Operational capex 19,217.8 19,447.5 8,949.2 11,254.7 Licence and related costs 219.5 18.6 213.6 8.6 Non-operational Capex 21,123.1 8,440.2 15,068.5 3,514.5 Consolidated Balance Sheet Data (at period end) 6/30/2025 12/31/2024 Cash and cash equivalents 116,601.1 80,428.4 Total assets 457,381.7 401,679.9 Long term debt 113,421.1 61,178.2 Total debt 172,858.1 121,737.9 Total liabilities 237,675.3 183,538.7 Total shareholders' equity 219,706.4 218,141.2 (*) Please refer to the notes on reconciliation of Non-GAAP Financial measures on page 14 For further details, please refer to our consolidated financial statements and notes as at June 30, 2025, on our website TURKCELL İLETİŞİM HİZMETLERİ A.Ş TURKISH ACCOUNTING STANDARDS SELECTED FINANCIALS (TRY Million) Half Ended Half Ended Quarter Ended Quarter Ended June 30 June 30 June 30 June 30 2025 2024 2025 2024 Consolidated Statement of Operations Data Turkcell Turkey 94,357.5 84,469.3 48,219.8 43,143.2 Fintech 5,827.8 4,584.2 2,916.3 2,369.4 Other 3,680.2 3,220.4 1,885.9 1,637.5 Total revenues 103,865.5 92,273.9 53,021.9 47,150.2 Direct cost of revenues (74,981.6) (71,223.1) (38,579.1) (35,823.7) Gross profit 28,884.0 21,050.8 14,442.8 11,326.5 Administrative expenses (4,095.9) (3,317.0) (1,975.4) (1,617.2) Selling & marketing expenses (6,749.5) (5,621.4) (3,341.5) (3,047.8) Other operating income 20,601.9 8,224.1 11,198.5 2,932.7 Other operating expense (1,226.0) (1,234.9) (483.8) (518.4) Operating profit 37,414.4 19,101.6 19,840.7 9,075.7 Impairment losses determined in accordance with TFRS 9 (513.7) (633.7) (308.0) (339.5) Income from investing activities 5,091.1 2,289.4 2,444.8 643.9 Expense from investing activities (125.6) (118.6) (66.0) (63.0) Share on profit of investments valued by equity method (2,120.1) (1,110.8) (1,204.2) (1,028.9) Income before financing costs 39,746.1 19,527.9 20,707.3 8,288.2 Finance income 87.6 485.4 (379.1) (345.7) Finance expense (28,663.5) (17,527.1) (15,076.3) (6,570.9) Monetary gain (loss) 1,842.6 5,502.3 826.1 1,626.2 Income from continuing operations before tax and non-controlling interest 13,012.8 7,988.5 6,078.1 2,997.9 Tax income (expense) from continuing operations (5,357.6) (1,723.7) (1,690.1) 209.4 Profit from continuing operations 7,655.2 6,264.8 4,387.9 3,207.3 Profit /(loss) from discontinued operations (187.4) 1,504.7 (187.4) 713.2 Profit for the period 7,467.8 7,769.5 4,200.5 3,920.5 Non-controlling interest - (9.7) - (1.8) Owners of the Parent 7,467.8 7,779.2 4,200.5 3,922.3 Earnings per share 3.43 3.57 1.93 1.80 Earnings per share from discontinued operations 3.51 2.88 2.01 1.47 Earnings per share from continuing operation -0.09 0.69 -0.09 0.33 Other Financial Data Gross margin 27.8% 22.8% 27.2% 24.0% EBITDA(*) 45,303.9 38,776.7 23,085.8 20,104.6 Total Capex 40,560.4 27,906.3 24,231.4 14,777.8 Operational capex 19,217.8 19,447.5 8,949.2 11,254.7 Licence and related costs 219.5 18.6 213.6 8.6 Non-operational Capex 21,123.1 8,440.2 15,068.5 3,514.5 Consolidated Balance Sheet Data (at period end) 6/30/2025 12/31/2024 Cash and cash equivalents 116,601.1 80,428.4 Total assets 457,381.7 401,679.9 Long term debt 113,421.1 61,178.2 Total debt 172,858.1 121,737.9 Total liabilities 237,675.3 183,538.7 Total equity 219,706.4 218,141.2 (*) Please refer to the notes on reconciliation of Non-GAAP Financial measures on page 14 For further details, please refer to our consolidated financial statements and notes as at June 30, 2025, on our website
Globe and Mail
26 minutes ago
- Globe and Mail
Coca-Cola Surpasses 50-Day Moving Average: Is This a Buy Opportunity?
The Coca-Cola Company KO has witnessed significant year-to-date growth, pushing the stock above industry thresholds and portraying bullishness from a technical standpoint. Coca-Cola's stock is benefiting from a blend of resilient demand, strategic pricing and investor recognition of its defensive strengths. Backed by the momentum, the KO stock recently surpassed its 50-day simple moving average (SMA). On Aug. 8, 2025, the stock closed at $70.34, crossing the 50-day SMA of $70.08. Since then, the KO stock has been on an uptrend. Coca-Cola's move above its 50-day moving average signals a shift in short-term momentum, suggesting that buying interest is strengthening after a period of consolidation or weakness. Technically, this level often acts as a key trend indicator, and breaking above it can attract additional investor attention, particularly from traders who view it as a bullish signal. It may also indicate improving sentiment toward KO's fundamentals and market outlook. The 50-day SMA is a key indicator for traders and analysts to identify support and resistance levels. It is considered particularly important as it is the first marker of an uptrend or a downtrend. SMA is an essential tool in technical analysis that helps investors evaluate price trends by smoothing out short-term fluctuations. KO Stock Moves Above 50-Day SMA Coca-Cola's momentum in the year-to-date period is evident from its 13.6% rally, which led it to outpace the Zacks Beverages – Soft Drinks industry and the broader Consumer Staples sector's advances of 6.2% and 4.9%, respectively. The stock also marked an outperformance relative to the S&P 500's growth of 8.3% in the same period. KO's performance is notably stronger than that of its key competitor, PepsiCo Inc. PEP, which declined 3.4% year to date. The stock also outpaced Keurig Dr Pepper Inc. 's KDP growth of 8.4% and Monster Beverage Corporation 's MNST growth of 21.8% in the same period. At its closing price of $70.71 yesterday, the KO stock trades 4.9% below its 52-week high mark of $74.38 and 16.6% above its 52-week low of $60.62. Coca-Cola's YTD Price Performance What's Driving KO's Momentum? Are There Risks Attached? Coca-Cola's recent momentum is rooted in strong business fundamentals, resilient demand and strategic execution. In second-quarter 2025, the company delivered solid organic revenue growth, driven by pricing initiatives, product innovation and balanced volume performance across key markets. Premium offerings and category expansion in areas like ready-to-drink beverages and protein-based shakes have helped broaden its portfolio appeal, while targeted marketing has reinforced brand strength globally. The asset-light franchise model continues to enhance operational efficiency and protect margins, even amid cost pressures. A key driver has been Coca-Cola's pricing power, enabling it to offset inflationary impacts without significantly eroding demand. Growth in emerging markets, coupled with stable performance in developed regions, reflects the company's ability to adapt to local consumer trends while maintaining consistent brand positioning. Additionally, digital initiatives and partnerships with bottling partners have improved supply-chain agility, supporting on-time delivery and inventory management. However, risks remain. Currency volatility, shifting consumer preferences, and increased competition in both traditional soda and non-carbonated categories may pressure growth. Macroeconomic uncertainty and potential regulatory actions on sugar-sweetened beverages also present ongoing challenges. Moreover, while pricing has been a key growth lever, over-reliance could strain volumes if economic conditions weaken. Overall, Coca-Cola's momentum reflects a blend of global brand equity, diversified offerings and disciplined execution. While the growth story remains intact, investors should watch for how the company balances pricing, innovation and market expansion against a backdrop of evolving consumer behaviors and economic headwinds. Estimate Revision Trend for KO The Zacks Consensus Estimate for Coca-Cola's 2025 EPS was unchanged in the last 30 days. Meanwhile, the consensus estimate for 2026 EPS has moved up by a penny in the past 30 days. For 2025, the Zacks Consensus Estimate for KO's revenues and EPS implies 3.2% and 3.1% year-over-year growth, respectively. The consensus mark for 2026 revenues and earnings suggests 5.6% and 8.4% year-over-year growth, respectively. Is Coca-Cola's Valuation Premium Justified? KO's current forward 12-month price-to-earnings (P/E) multiple of 22.6X raises concerns about whether the stock's valuation is justified. This multiple is significantly higher than the Zacks Beverages – Soft Drinks industry average of 18.05X, making the stock appear relatively expensive. At 22.6X P/E, Coca-Cola trades at a significant premium to most of its industry peers. The company's peers, such as PepsiCo and Keurig Dr Pepper, are delivering solid growth and trade at more reasonable multiples, while Monster Beverage trades at a premium multiple. PepsiCo and Keurig Dr Pepper have forward 12-month P/E ratios of 17.76X and 16.35X, significantly lower than KO. However, Monster Beverage trades at a P/E multiple of 32.04X. The KO stock's premium valuation suggests that investors have strong expectations for its growth. However, the stock currently seems somewhat overvalued. Coca-Cola's ability to meet or exceed these lofty expectations is crucial in justifying its premium pricing. Does Near-Term Bullishness Suggest a Buy for KO? Coca-Cola's move above its 50-day SMA reinforces the stock's strong technical momentum, reflecting sustained investor confidence supported by steady demand, pricing power and a globally recognized brand. Positive estimate revisions for 2026 earnings further highlight market optimism about the company's ability to deliver growth. This combination of technical strength and encouraging forecasts positions KO as a resilient player in the consumer staples space. However, the premium valuation leaves little margin for error, and ongoing challenges, including currency volatility, shifting consumer preferences and regulatory risks, may affect future gains. While the bullish momentum is notable, Coca-Cola must maintain consistent execution to justify investor expectations and sustain its upward trajectory. Existing shareholders may consider holding their positions, while new investors may wait for more attractive entry points before initiating exposure in this Zacks Rank #3 (Hold) company. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. See our %%CTA_TEXT%% report – free today! 7 Best Stocks for the Next 30 Days Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. CocaCola Company (The) (KO): Free Stock Analysis Report PepsiCo, Inc. (PEP): Free Stock Analysis Report Keurig Dr Pepper, Inc (KDP): Free Stock Analysis Report
