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The Coca-Cola Co expects emerging markets to continue to fire growth over the next year, but it warned analysts not to discount North America.

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Coca-Cola executives today (7 February) declared themselves to be "bullish" on the both the year ahead and on North America specifically. Following a 5% rise in global group volume sales for calendar 2011, driven by emerging markets but reflecting growth in every geographic region, the group believes that it is entering 2012 "from a position of strength".

Speaking on the firm's full-year results call with analysts, Coca-Cola's CEO, Muhtar Kent, said that the company's growth is broad-based. "We see a healthy trend continuing in Latin America, Eurasia, Africa and most of the Pacific area, and we see healthy trends right here in North America," he said.

Kent argued that there is "no other market in the developed world" as dynamic as the US, especially due to the country's favourable demographics. "We have every reason to remain excited about the long-term outlook of our flagship market," he said. 

Still, he conceded that much of southern Europe is more challenging and that Coca-Cola will come under pressure there in the first half of 2012, in particular. But, Kent added: "We are confident we have the right structures in place in Europe over the longer-term."

Coca-Cola's net profits fell by 27% for the 12 months to the end of December, to US$8.6bn, but the fall largely reflects gains registered in 2010 following its acquisition of Coca-Cola Enterprises' bottling operations in North America. Operating profits, meanwhile, rose by 20% to $10.1bn for 2011, or by 12% if currency gains are stripped out, which is ahead of the firm's long-term growth target. Net sales jumped by a third on 2010, to $46.5bn, inflated by the addition of CCE North America operations. 

Despite the assertion that Coca-Cola is growing in both mature and developing markets, there will be a strong focus on cost savings in the former. The group said today that it intends to carve out up to a further $250m in costs at Coca-Cola Refreshments in North America within the next four years. This in on top of the original plan to save $350m at the division following the CCE deal.

The fresh savings form part of a global cost savings initiative that is expected to save up to $650m annually by the end of 2015, Coca-Cola said. Its share price rose by 1% on the New York stock exchange following its results release.


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