Coca-Cola reported adjusted earnings of 58 cents per share on net income of $1.8 billion for the third quarter, up from $1.45 billion of net income for the same period last year.

Analysts had forecast earnings per share of 55 cents per share and revenue of $8.17 billion. Reported revenue was $8.25 billion, down 9% year-over-year.

The company said it saw double-digit sales growth for its Coca-Cola Zero Sugar product, while sales of sparkling soft drinks grew 2%. It increased prices in North America in response to higher import costs and higher transportation costs.

“We had a solid quarter we’re on track to close out the year for our guidance,” Chief Executive Officer James Quincey said on the earnings conference call.

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Sales of water and of sports drinks grew 5%, mostly due to China and Mexico. Sales of juice, dairy, and plant-based beverages fell 3%. A strong U.S. dollar hurt overseas sales, the company said.

“Overall, we are impressed with [Coke’s] ability to deliver a strong and balanced topline, suggesting that its refranchising and portfolio transformation are paying off,” Wells Fargo analyst Bonnie Herzog wrote in a note to clients.

During the quarter, Coca-Cola agreed to buy the U.K. coffee shop company Costa for $5.1 billion, one of its largest acquisitions ever, saying the deal will give it “the capabilities to build a global coffee platform.” The deal is expected to close in the first half of 2019.

The company also affirmed its guidance for 2018 of adjusted earnings per share of 8% to 10% and reiterated organic revenue growth (stripped of foreign currency rates) of 4% for the full year.

“We continue to be encouraged by our performance year-to-date as we accelerate our evolution as an even more consumer-centric, total beverage company,” Quincey said. “The recent leadership appointments are intended to help accelerate the transformation of our company.”

Quincey downplayed reports the company was exploring cannabis-infused drinks, saying it did not have plans at this stage to enter the market.

Photo: Getty Images

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