Coca-Cola, the world’s largest beverage company, reported fourth-quarter profits that beat analysts’ estimates, helped by cost-cutting efforts and a shift towards higher-priced drinks.
Excluding some items, profit was 44 cents a share in the period, Coca-Cola recently said in a statement.
Analysts estimated 42 cents on average, according to data compiled by Bloomberg. While revenue dropped 1.5 per cent to $10.9 billion, that also exceeded projections. Analysts had predicted sales of $10.8 billion.
Coca-Cola chief executive officer Muhtar Kent, coping with currency challenges and sluggish growth worldwide, is trimming expenses and selling more premium-priced beverages. He aims to pare $3 billion from Coca-Cola’s annual costs. He’s also confronting mounting concerns over obesity and artificial sweeteners.
Coca-Cola “has been relatively diligent in its pricing strategy, which we believe has and will continue to drive top-line growth in domestic markets,” Bonnie Herzog, a New York-based analyst for Wells Fargo & Co., said in a note last week.
Coca-Cola shares rose as much as 4.5 per cent to $43.08 in pre-market trading after the results were released. The shares had dropped 2.3 per cent this year, compared with a 0.6-per-cent decline for the Standard & Poor’s 500 Index.
Global volume grew 1 per cent last quarter. Excluding the effects of currency, revenue would have grown about 4 per cent in the period, the company said.
Like many US businesses with a global footprint, Coca-Cola has seen the strong dollar erode the value of its overseas sales.
Bloomberg News, edited by ESM
