Russian Coca-Cola continue to make money

Stunning success of the "exited" Coca-Cola in Russia

According to the company, Coca-Cola HBC Holdings B.V. Multon Partners LLC, the Russian arm of Coca-Cola Coca-Cola, had a profit of almost €111 million in 2023. The company's financial statements for 2022 show a profit of USD 111 billion, or more than four times the 2022 financial statements.

The jump in profits is significant even when measured against the company's earnings before the war in Ukraine. In 2023, the company boasted a 150% increase in profits.

Back in March 2022, almost immediately after Russia launched a full-scale invasion of Ukraine, Coca-Cola announced that it was suspending its operations in the country. The main competitor, PepsiCo, made a similar announcement. However, withdrawing from the Russian market was much easier in words than in deeds^[1].

"They said goodbye, but they did not leave. They announced their departure, but in reality, they did not go anywhere, and the products have been available on the market for more than six months and even produced in Russian factories", pointed out Natalia Sakhnina, CEO of the Russian drinks conglomerate Chernogolovka Group.

The word "Coca" has been successfully replaced by "Dobryj" in Russia

Coca-Cola has for some time traded on its inventory in Russia, but this has not happened, despite CEO James Quincy hinting that his company might one day face the prospect of its business disappearing in Russia.

When the Coca-Cola brands were discontinued in Russia, they were replaced by "Dobry Cola" (Good Cola). With the halt in investment and the end of concentrate availability for the production of traditional Coca-Cola HBC beverages, the company's Russian unit switched to buying raw materials on the domestic market.

By the end of 2023, Dobry Cola will become one of the ten most popular everyday brands among Russian consumers, according to an analysis by research company NTech. Dobry has also become the market leader in the sweet carbonated drinks category, ahead of Chernogolovka and Cool Cola.

In a commentary published by Reuters in August 2022, Coca-Cola HBC stated that Dobry Cola has no link to the original Coca-Cola or to Coca-Cola Co. itself.

In fact, the company itself, formerly Coca-Cola HBC (Coca-Cola HBC Eurasia LLC), has changed its name to Multon Partners, but it remains the Dutch Coca-Cola HBC Holdings B.V. remains a division of. The latter, in turn, is part of the global Coca-Cola Hellenic Bottling Company.

Coca-Cola owns 23,2 % of Coca-Cola HBC AG.

EU sanctions Russia for human rights violations

Since 2014, the EU has imposed heavy individual and economic sanctions on Russia over Ukraine. The EU has also imposed sanctions for human rights violations, in particular, the death of Aleksey Navalny.

Sanctioned persons and entities:

• -prison facilities where Navalny was held from June 2022 until his death,
• -members of the judiciary involved in the death of Navalny and the Vladimir Kara-Murza case,
• -high-level officials of the prison system and the Ministry of Justice,
• -Russia's quasi-governmental Safe Internet League.

Sanctions are adopted under the global sanctions regime for human rights violations.

Death of Alexei Navalny: EU sanctions 33 individuals and two entities under the global sanctions regime for human rights violations (Press release, 22 March 2024)

General sanctions regime for human rights violations: the Council added four more persons and one entity to the EU sanctions list (press release, 29 January 2024).