Analysis - Coca-Cola Co more dependent on North America
Coca-Cola released its Q3 results yesterday
The Coca-Cola Co's North American unit now accounts for nearly half of the company's overall sales despite growth in emerging markets, an analyst has said.
In third-quarter results, released yesterday, North America represented 48% of Coca-Cola's sales, CLSA's Caroline Levy said today (16 October). The figure was up from 44% in 2011, the first full year after Coca-Cola brought its US bottling operations in-house.
Levy said most of the share increases came from Europe and investments in bottling operations. The analyst expects Coca-Cola's full-year sales to be 46% North America.
The high sales percentage was boosted in the third quarter by a strong North America performance for Coca-Cola, with volumes growing by 2% in the period. Meanwhile, China grew volumes by 9% and India by 6%.
Levy also said that a shake-up of Coca-Cola bottler franchising agreements in the US could lead to the company offering distribution rights to a beer distributor. The plan, first announced in April, will allow Coca-Cola to “retain all manufacturing assets and simply offer distribution rights - plus assets like trucks and warehouses - to a franchisee who could be an existing system bottler or a new partner, possibly a beer distributor”, said Levy.
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