The Coca-Cola Company is lowering its long-term earning and sales targets. In a statement today (11 November), the company added that continued weak performance in certain key markets was expected in 2005 as operational issues are addressed.

The company's revised annual volume target is between 3% and 4% over time. Coke said it was targeting annual operating income growth of between 6% and 8% and earnings per share growth in the high single digits.

The company's previous long-term targets were between 11% and 12% EPS growth and between 5% and 6% volume growth.

"As we have assessed our future growth opportunities, we believe we have outlined realistic and achievable financial growth targets over time," said CEO Neville Isdell. "We believe that once we take the necessary steps to get back on our path to growth, our company will be well positioned to reach these targets."

Coke added, however, that it does not regard its long-term growth rate targets as being applicable in 2005, and said that guidance for 2004 earnings per share provided on 21 October this year had not changed.

"The company expects continuing weak results in certain key markets to persist into 2005 as it begins to address operational issues," a statement said. "These markets include North America, Germany and the Philippines."

Coke added that there would be a permanent step up in annual marketing and innovation investments of between US$350m and $400m beginning next year.

Isdell added: "When I returned to The Coca-Cola Company, I did so determined to help lead the greatest company I know to ever higher levels of profitable growth, and fully utilise all of our core assets - including our world-leading brands, our unparalleled distribution system and our strong cash flow. At the outset, I recognised that meeting this objective would require a relentless focus on execution as well as the patience to get the basics right. Following our strategic and tactical review, we are now prepared to commit to key targets and launch our initial corrective steps to assure that we realise our potential."

Coke also said that currencies are expected to have a slightly positive impact on results in 2005. The company will decide during 2005, however, whether to reinvest any positive currency benefits once those benefits have been realised.