On Tuesday, Coca-Cola revised its yearly organic sales projection following the positive results achieved on the first-quarter of 2024. The company exceeded revenue and profit expectations; this success comes as customers worldwide continue to spend more on its premium sodas and juices.
The company also witnessed a surge in demand in the U.S., particularly in the out-of-home sector. Both Coca-Cola and PepsiCo are also experiencing robust demand in international markets such as Europe and Latin America, benefiting from the relaunches of Georgia Coffee and Sprite formulations. Coca-Cola’s organic revenue in Europe, the Middle East, and Africa saw a 15% rise in the first quarter, while North America witnessed a 7% increase.
The company’s overall average selling price climbed by 13%, despite unit case volumes rising by only 1%. Coca-Cola has been actively promoting its existing products and introducing new ones to stimulate demand, particularly among lower-income consumers. While water, sports drinks, coffee, and tea saw declines in unit case volume for the quarter, Coca-Cola reported a continuous increase in prices due to rising input costs.
Coca-Cola anticipates organic sales growth of 8% to 9% for fiscal 2024, up from its earlier projection of 6% to 7%.
In the first quarter of 2024, Coca-Cola’s net revenue increased by 2.5% to $11.23 billion, surpassing LSEG estimates of $11.01 billion. On an adjusted basis, the company earned 72 cents per share, compared with expectations of 70 cents. Coca-Cola maintained its annual comparable earnings per share forecast of 4% to 5% growth.
Coca-Cola’s shares experienced a 0.5% decline in premarket trading.
Key Highlights from the First Quarter of 2024:
- Revenues: Net revenues grew 3% to $11.3 billion, with organic revenues increasing by 11%. This growth included a 13% increase in price/mix and a 2% decline in concentrate sales.
- Operating margin: Operating margin was 18.9%, while comparable operating margin was 32.4%, driven by refranchising bottling operations and strong topline growth.
- Earnings per share: EPS grew 3% to $0.74, while comparable EPS grew 7% to $0.72.
- Market share: The company gained value share in total nonalcoholic ready-to-drink (NARTD) beverages.
- Cash flow: Cash flow from operations increased by $368 million versus the prior year, reaching $528 million. Free cash flow (non-GAAP) was $158 million, up by $274 million compared to the previous year.
Click here to view the official Coca-Cola First Quarter Report
