Coca-Cola has lifted its annual profit guidance as the US drinks behemoth side-stepped challenges facing rivals such as PepsiCo.
Demand for the group’s soft drinks held up in the third quarter, with a 5% rise in volumes leading to a 7% increase in organic revenues to $13.4bn. That growth was well ahead of analyst expectations for the quarter.
A 16% jump in sales in Latin America led the way in Q3, with Europe, Middle East and Africa up 7% and Asia Pacific up 6%, with the domestic North American market lagging with 3% growth.
Coke said India, China, Mexico and Brazil were the chief drivers of the higher unit case volumes in the period.
Management raised full-year guidance to organic sales growth of at least 5% and a jump in comparable earnings per share of 11% and upwards.
“Our results this quarter demonstrate our system’s sustained momentum, giving us confidence in our updated full-year guidance,” said CEO Henrique Braun.
“By staying close to consumers and executing with agility across our global system, we are delivering quality growth while continuing to invest in the capabilities, brands and people that will fuel our future.”
In the Europe, Middle East and Africa region, volumes increased 5% in Q3, driven by growth in trademark Coke, water, sports drinks, coffee and tea, and sparkling flavours. However, the company flagged it lost value share in non-alcoholic ready-to-drink beverages in the UK and France.
“Coca-Cola is in a better position than most,” said Nik Modi of RBC Capital Markets. “The company has proven savvy at navigating exogenous shocks better than most CPG companies. It is clear the stock is heavily favoured by the investor community. We are aligned with this view.”
No comments yet