Coca Cola Co. (NYSE: KO) earnings were released on Wednesday and was driven by the company’s outlook and plans to launch more health and sugar free alternative soft drinks.
The company reported in their earnings that net revenue declined by 16% due to bottling divestitures and currency exchange and organic revenues grew by 3%, driven by price/mix of 3%.
The soft drink based company beat the expectations of Thomson Reuters analysts’ consensus. The consensus had expectations of EPS 57 cents adjusted, but the company posted 59 cents. It was also predicted in the consensus of a revenue of $9.652 billion, but Coca-Cola posted $9.702 billion.
The company is speeding up their process to expand globally with their low to no sugar sparkling soft drinks.
"Our second quarter results demonstrate continued progress against the strategic priorities we have laid out to accelerate the transformation of our business into a total beverage company with balanced growth across a consumer-centric portfolio. Not only did we see strong performance during the quarter in rapidly expanding areas of our Company, such as our innocent juice and smoothie business in Europe, our organic revenue growth in sparkling soft drinks was led by innovation in and marketing support for our low- and no-sugar options like Coca-Cola Zero Sugar, which continues to roll out around the world." stated James Quincey, President and Chief Executive Officer of Coca-Cola in the earnings release.
This is Quincey’s first earnings reports as President, as former CEO, Muhtar Kent stepped down back in May.
The company stated in the earnings that it made very good progress against their strategic priorities, which includes its efforts to change up their beverage portfolio.
The notable change and progress that it highlighted was: Low- and no-calorie sparkling soft drinks increased unit case volume mid single digits during the quarter as it sped up the introduction and expansion of reduced-sugar offerings around the world. Coca-Cola Zero Sugar continued to grow double digits in Europe, Middle East & Africa and Latin America, according to the report.
The company says that this shows its efforts to provide consumers with a great tasting as it also expanded its products to consumers in different regions across the world.
In Great Britain, the company launched new flavors of sparkling smartwater as well as new low-sugar Oasis drinks. In other parts of Europe, the company expanded its Honest Tea brand into France, Netherlands, and Belgium. The company also stated other expansions that happened, which can be seen in its earnings.
For the full year forecast, Coca-Cola expects earnings per share to be either steady or drop 2 percent, which is better than its previous expectations of declines of 1 to 3 percent. The company still projects organic revenue to grow roughly 3 percent, according to CNBC.
“Our performance gives us confidence that we will achieve our full year financial objectives even in the face of challenging conditions, and also demonstrates further success in evolving our portfolio to meet changing consumer tastes and preferences. While we are in a period of substantial transformation and change that is never easy, I am encouraged by the spirit of our people and partners as we reinvent the Company for the future.” Quincey said in the earnings report.