The Coca-Cola Amatil Ltd (ASX: CCL) share price and latest profit result have one thing in common. They both lack fizz.
The CCL share price slumped 1.7% to a five-week low of $8.22 this morning and the weakness in the broader market isn't helping with the S&P/ASX 200 (Index:^AXJO) (ASX:XJO) index shedding 0.2% of its value.
But the beverage group has given little for investors to look forward to when it announced a 37.3% crash in net profit to $279 million as it wrote down the value of its canned fruit business SPC to zero.
A bitter drink
It's sad to imagine how a long-established brand like SPC is now worth nothing and it doesn't speak well of Coca-Cola Amatil's effort to sell the struggling business.
The group will probably get something for it as it has fielded offers from a range of potential suitors but the decision to write down the value of SPC is a sign that Coca-Cola Amatil is unlikely to get an offer at book value, which was pegged at $146.9 million before today's write down.
If you were hoping for some silver lining in other parts of Coca-Cola Amatil's results, you will probably be disappointed.
The group's underlying net profit from operations dipped 6.5% to $388.5 million, and while that's ahead of consensus forecast by nearly $10 million, that isn't enough to win support from the market as Coca-Cola Amatil is on a long road to redemption.
More pain till recovery
Coca-Cola Amatil's managing director Alison Watkins said 2018 is a transition year for the group but so is 2019.
Investors will have to wait till 2020 for the group to return to growth and there's frankly no rush to buy the stock.
It's Australian, Indonesian and Papua New Guinea operations are still struggling although its alcohol and coffee, Fiji and New Zealand businesses delivered growth.
At some stage this year, the Coca-Cola Amatil share price could look like a decent value buy. Right now though, there aren't any near-enough catalyst for the stock to tempt the bargain hunter in me –not when there are better value stocks to look at.
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