Coca-Cola Co.’s earnings per share ticked at $0.45, beating the Zacks consensus forecast of $0.44 by 2.3 percent. However, revenues missed the same. Reported net revenue dipped 4 percent to $10.28 billion due to currency headwinds and one less selling day in the quarter. Organic revenue grew 2 percent, and its outlook is expected at 4-5 percent.
Sales fell for the fourth straight quarter as demand for soda faded in Europe and a strong dollar ate into revenue from other markets outside the U.S. Net income fell 4.5 percent to $1.48 billion, or 34 cents per share.
The company’s global volume climbed 2 percent, while the global price was a rather positive 1 percent—the solid underlying pricing was partially offset by segment mix.
The comparable currency neutral operating margin also expanded 9 percent, while the annual comparable currency neutral earnings outlook remains unchanged at 6-8 percent.
The world’s largest beverage company also reported a strong performance in North America, having transferred or signed agreements on nearly 2/3 of the U.S. territories originally acquired from Coca-Cola enterprises.
Coca-Cola also made new investments in Mexico which include sparkling fruit drink Del Valle & Nada, and Ciel mineral and flavored waters, contributing to unit case volume increase of 5 percent, with growth across all major categories.
It also invested in Nigeria’s leading juice and value-added dairy company, Chi.
Coca-Cola also made efforts to surge premium offerings in China, with increased availability of Schweppes +C in high-value channels. With the closing of the Culiangwang acquisition in March, the company expanded into plant-based protein drinks.
In Japan, products such as I Lohas Peach contributed 4 percent unit case volume. It has also leveraged innovation from China to launch Fanta Lemon +C, which has seen strong early results.
Non-alcoholic beverages contributed to the mentioned global value share—aside from soda, Coca-Cola Co. also makes Dasani water and Minute Maid orange juice.
The average American drinks 650 eight-ounce servings of soda a year in 2015, significantly lower than 2010’s result of 730. With soda sales have its ongoing decline in America, Coca-Cola Co. has developed other strategies to cope up with the situation. One of these strategies was to diversify its products and offer non-soda drinks such as Powerade, Glacéau Vitaminwater and Fuze Tea to the market.
Another way was to leaping into emerging markets like that of India’s. Sprite is one of the best-selling sodas in India, and Coke is swiftly catching up on the trend. India also became the sixth largest market for Coca-Cola in 2014. The country’s still portfolio profited from the beverage maker’s newest value-added dairy product, Vio. By year 2020, the company has planned to invest more than $3 billion in the said country and subsidize a growing market for non-alcoholic drinks.
During the quarter, the beverage maker also revealed their new global ‘one brand’ marketing strategy, ‘Taste the Feeling’ campaign for Trademark Coca-Cola, which is now live in 195 markets.
Coca-Cola Enterprises is also due to merge with Coca-Cola Iberian Partners and Coca-Cola Erfrischungsgetränke AG to form a Western European bottler— Coca-Cola European Partners. The deal is estimated to close by the end of second quarter 2016.