Coca-Cola shares jump 3% after earnings beat, as shift from sugary drinks boosts sales - CNBC

Coca-Cola beat estimates for quarterly earnings and revenue Tuesday after consumers bought more of its water, sports drinks and its namesake Zero Sugar beverages.

Shares of the company jumped 3% in premarket trading.

"We're encouraged by our first quarter results as our disciplined growth strategies continue to deliver strong underlying performance," Coca-Cola CEO James Quincey said in a statement.

Here's what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

• Earnings per share: 48 cents, adjusted, vs. 46 cents expected
• Revenue: $8.02 billion vs. $7.88 billion expected

The beverage giant reported fiscal first-quarter net income of $1.68 billion, or 39 cents per share, up from $1.33 billion, or 32 cents per share, a year earlier.

From continuing operations, the Atlanta-based company earned 48 cents per share, topping the 46 cents per share expected by analysts surveyed by Refinitiv.

Net sales rose 5% to $8.02 billion, beating expectations of $7.88 billion. The company attributed 2% of the sales growth to timing related to building up bottler inventory to hedge Brexit uncertainty.

Unit case volume grew 2%, helped by key markets in Asia and Europe. Argentina once again was a sore spot, with volume declining by double digits as the country's recession continues into 2019. North American unit case volume declined by 1%, while net sales for the region rose by 1%. The company blamed the impact of price hikes and packaging initiatives, as well as the timing of Easter, which landed late this year.

Sparkling soft drinks volume grew by 1%. The Coca-Cola brand continues to perform well globally, thanks to Coca-Cola Zero Sugar's double-digit growth for its sixth consecutive quarter. In February, the brand launched its first new flavor in more than a decade: Orange Vanilla.

The company's water, enhanced water and sports drink business saw unit case volume grow by 6%, driven by consumers' eagerness for smaller, immediate consumption packages.

The company also completed its $5.1 billion acquisition of British coffee chain Costa during the three months ended March 29. Coca-Cola plans to introduce Costa ready-to-drink products in its second quarter.

After the company told investors last quarter that its 2019 earnings could decline by as much as 1%, its stock had its worst day in more than a decade. Quincey attributed the gloomy outlook to currency fluctuations, Fed rate hikes and changing tax rates. The company reiterated its full-year outlook, forecasting that earnings per share could fall or rise by 1% and organic revenue growth of 4%.

Following Coke's annual meeting Wednesday, Quincey will become chairman of the company as long as he is reelected as a director. Quincey is taking over from Muhtar Kent, who served as CEO until 2017.

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https://www.cnbc.com/2019/04/23/coca-cola-q1-2019-earnings.html

2019-04-23 11:03:27Z
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