June 13 (Bloomberg) -- Coca-Cola Hellenic Bottling Co., the world's second-biggest bottler of Coke beverages, fell the most in at least 16 years in Athens trading after cutting annual forecasts for sales and profit.

Coca-Cola Hellenic dropped 21 percent, the steepest decline since Bloomberg records began in 1992. Per-share profit this year will rise between 5 percent and 8 percent, the Athens-based company said today in a statement, below its prior prediction for a gain of 12 percent to 15 percent.

Surging food and fuel prices curbed consumer spending, most severely in Italy, Ukraine and Romania, the bottler said. Record oil prices have also led to increased packaging and distribution costs, the company added. Confidence among European executives and consumers stayed at the lowest in almost three years in May, the European Commission in Brussels said last month.

``Current economic conditions are very demanding,'' said Andreas Balaskas, an analyst at Marfin Securities, who has a ``hold'' rating on Coca-Cola Hellenic. ``There have been signs of this from the beginning of the year. I don't know what management can really do to alleviate some of these issues.''

Coca-Cola Hellenic fell 5.60 euros to 21.30 euros in Athens, reducing the company's market value to 7.8 billion euros. Today's drop means the stock has slid 28 percent this year, the steepest decline in the 11-company Bloomberg Europe Beverages Index. Atlanta-based Coca-Cola Co. owns a 24 percent stake.

Sales Growth Falters

The new forecast equates to earnings per share of between 1.37 euros ($2.11) and 1.40 euros this year, Coca-Cola HBC said.

Sales growth in May, the start of the company's peak selling season, was in ``low single digits'' in percentage terms by volume, ``well below initial plans,'' the bottler said.

``While we are adjusting our near-term outlook, longer-term we continue to believe that the structural characteristics of our geographic portfolio and strong marketplace capabilities will help to create value for shareholders,'' the company said.

The quantity of beverages sold this year will climb 6 percent, below a prior forecast of 7 percent, the statement shows. Earnings before interest and tax will increase between 5 percent and 7 percent, less than the 11 percent to 13 percent gain the bottler had predicted, according to the release.

Weather that was more severe in central Europe and Russia than a year earlier also dented sales volumes. In Coca-Cola HBC's domestic market, a 12-day strike by truckers caused delays of as much as four weeks in supplying vendors.

Developing Markets

The Greek company bottles sodas, waters, juices and other non-alcoholic beverages in 27 European countries and Nigeria. Coca-Cola HBC generates more than half its revenue in developing markets, where economic growth that's stronger than in western Europe has fueled incomes and spending.

The slowdown at the company ``creates risk'' for Coca-Cola and Pepsi Bottling Group Inc., indicating that international sales may not offset softer U.S. sales, William Pecoriello, an analyst at Morgan Stanley, said in a note. Hellenic accounts for 8 percent of Coca-Cola's global volume. Pecoriello maintained his ratings and price estimates for both companies.

Coca-Cola HBC was created in 2000, when Hellenic Bottling Co. SA, which bottled Coke in Greece, Russia and the Balkans, acquired U.K.-based Coca-Cola Beverages Plc, which operated in 13 central and Eastern European countries.

Coca-Cola Enterprises Inc., based in Atlanta, is the largest bottler of Coke beverages by sales. The company said last month that meeting its forecast for 2008 earnings would be challenging.

To contact the reporter on this story: Maria Petrakis in Athens at mpetrakis@bloomberg.net.

Last Updated: June 13, 2008 10:55 EDT