US: Coke earnings fall, but result ahead of expectations
The Coca-Cola Company has reported a fall in second quarter earnings, as the company took a hit on a non-cash impairment charge at bottler Coca-Cola Enterprises. Despite the fall, the result was still ahead of many analysts expectations.
Second quarter earnings per share reached US$0.61, a decrease of 24% versus the prior year on a reported basis. After items impacting comparability, however, EPS reached US$1.01, an increase of 19%.
Earnings per share for the quarter included a net charge of US$0.40 per share primarily related to a non-cash impairment charge at Coca-Cola Enterprises, an equity investee.
"Our results in the quarter underscore our ability to continue delivering volume growth and double-digit comparable earnings per share growth, despite the combined impacts of several one-off events and a more challenging economic environment," said Neville Isdell, chairman of the board, The Coca-Cola Company. "We continue to manage the business for the long term by investing in brand building and innovation with an unrelenting focus on improving our effectiveness and efficiency. We have made significant progress since the turnaround began in 2004 and I am confident going forward under Muhtar's leadership that the business will continue to be managed by investing for long-term sustainable growth and value."
President and CEO Muhtar Kent said: "Our second quarter performance demonstrates our ability to leverage the strengths of our system to achieve balanced growth."
Kent pointed out that the results were once again led by the company's international operations, which delivered 5% unit case volume growth. Coke said it maintained volume in North America despite "significant challenges".
There were also solid performance in many of its emerging markets including China, Turkey, India, Eastern Europe, Southern Eurasia, North and West Africa and the Middle East.
"We have accelerated our global volume and value share gains as consumers connect with our brands and our system executes in the marketplace," said Kent.
"We are clearly operating in a more challenging macroeconomic environment. A strength of our system is the ability to work with our bottling partners and customers to understand the local factors impacting consumer behavior, adjust our plans where appropriate, while continuing to invest and build share for the long term. Both the fundamentals of our business and the strength of our brands remain solid. Through our focus on superior execution and driving productivity, I remain confident we are building a stronger Coca-Cola system for the future."
Second quarter net operating revenues increased 17%, reflecting a 3% increase in concentrate sales, a 2% increase from structural changes primarily resulting from acquisitions of certain bottlers, a 3% benefit from pricing and mix and a 9% positive currency impact.
Operating income in the quarter increased 18% on a reported basis and 20% after considering items impacting comparability. I
Unit case volume increased 3% in the second quarter and 4% year-to-date. Acquisitions contributed 1 point of unit case volume growth for both the quarter and year-to-date.
Meanwhile, the company said it continued to achieve growth in sparkling beverages, which increased unit case volume 1% in the quarter. Trademark Coca-Cola unit case volume was slightly positive in the quarter and trademarks Fanta and Sprite increased unit case volume 1% and 3%, respectively.
By comparison, still beverage unit case volume increased 13% in the quarter, led by strong growth across the company's still brand portfolio, including juice and juice drink brands, tea brands and water brands.
While the past 12 months have been difficult for many soft drinks companies, notably in North America, the last year has seen continued development in better-for-you categories, notably enhanced water...
The Coca-Cola Co has replied to a complaint by the US Food and Drug Administration over its Diet Coke Plus drink....
The top ten stories published on just-drinks this week:...
Lawyers and a consumer advocacy group are suing The Coca-Cola Co for deceptive marketing of its VitaminWater drink, a claim derided as "ludicrous" by the soft drinks giant....
A senior executive at Coca-Cola Enterprises (CCE) has announced her retirement from the company....
Lawyers and a consumer advocacy group are suing Coca-Cola, accusing the soft drinks giant of deceptive marketing on its VitaminWater drink....
Coca-Cola UK has confirmed that Welsh singer Duffy will star in its new Diet Coke European advertising campaign....
The Coca-Cola Co has defended its Diet Coke Plus drink against an allegation by the US Food and Drug Administration that the product breaches the law....
- Coca-Cola pressure builds as bid rumours swirl
- Gin: Plymouth's from Plymouth, London's from...?
- Fireball Recall: Putting Out Fire with Anti-Freeze
- Comment - IPO Launch a Tonic for Fever-Tree
- Why Chinese beverages won't conquer the world
- NPD - Moët Hennessy’s Glenmorangie Dornoch
- Anheuser-Busch InBev cuts jobs in US shake-up
- Diageo targets Millenial women with Baileys push
- Pernod blames rule changes for Plymouth GI drop
- William Grant unveils bespoke Glenfiddich website
- Early Signals: future scenarios that will drive consumption and product innovation over the next five years
- Global Scotch whisky insights - market forecasts, product innovation and consumer trends research
- Global Beer Opportunities: Beyond Standard Lager
- The IWSR Global Trends Report 2014
- Global Cognac insights - market forecasts, product innovation and consumer trends research