The Coca-Cola Company Reports First Quarter 2017 Results
On Track to Deliver Full Year Targets
· Net Revenues Declined 11%, Reflecting Unfavorable Impacts from Structural Changes of 10% and Foreign Currency of 1%
· Organic Revenues (Non-GAAP) Were Even, Which Included the Impact of Two Fewer Days in the Reporting Calendar and the Shift of the Easter Holiday
· Price/Mix Grew 3% with Balanced Contribution Across the Operating Segments
· Operating Margin and Comparable Currency Neutral Operating Margin (Non-GAAP) Expanded More than 90 Basis Points and More than 220 Basis Points, Respectively
· EPS of $0.27 and Comparable EPS (Non-GAAP) of $0.43
· On Track to Deliver Full Year Organic Revenue (Non-GAAP) and Comparable EPS (Non-GAAP) Targets
· Expanding Our Existing $3 Billion Productivity and Reinvestment Program to Capture an Incremental $800 Million in Annualized Savings by 2019
ATLANTA, April 25, 2017 – The Coca-Cola Company today reported first quarter 2017 operating results. Muhtar Kent, Chairman and Chief Executive Officer of The Coca-Cola Company, said, “The first quarter performance was in line with our plan, and we remain on track to deliver our underlying revenue and profit targets for the full year. As anticipated, revenues in the quarter were adversely impacted by two fewer days and the shift of the Easter holiday. Most importantly, we continue to execute against the long-term strategic transformation plan for the Company – a plan that I am confident will deliver even greater shareowner and stakeholder value in the years to come.”
“Next week I will proudly hand over the CEO reins to James Quincey with full confidence that he will complete the Company’s transformation and lead our aggressive growth agenda. His vision of accelerating The Coca-Cola Company’s evolution into a total beverage business with a focus on driving sustainable growth across a broad portfolio is exciting for all stakeholders, and he has my full support,” Kent continued.
President and Chief Operating Officer James Quincey said, “We are rapidly evolving our growth model to make changes that will result in an even more consumer-centric portfolio that meets people’s changing tastes and preferences. Importantly, these portfolio changes will help our consumers moderate the amount of added sugar they consume. In addition, as we approach the end of our refranchising and implement our new, more agile operating model, we are expanding our productivity program. Our revamped portfolio, a stronger global bottling system, and a leaner enterprise structure will allow us to capture an increasing share of the vibrant value growth available in the beverage industry and to deliver value for our shareowners. It will be an honor and a privilege to lead the organization as CEO, and I look forward to working with our people around the world to accelerate our growth.”
· All references to growth rate percentages and share compare the results of the period to those of the prior year comparable period.
· All references to volume and volume percentage changes indicate unit case volume, unless otherwise noted. All volume percentage changes are computed based on average daily sales, unless otherwise noted. “Unit case” means a unit of measurement equal to 24 eight-ounce servings of finished beverage. “Unit case volume” means the number of unit cases (or unit case equivalents) of Company beverages directly or indirectly sold by the Company and its bottling partners to customers.
· “Core business” represents the combined performance from the Europe, Middle East & Africa; Latin America; North America; Asia Pacific; and Corporate operating segments offset by intersegment eliminations.
· “Concentrate sales” represents the amount of concentrates, syrups, beverage bases, and powders sold by, or used in finished beverages sold by, the Company to its bottling partners or other customers. In the reconciliation of reported net revenues, “concentrate sales” represents the percent change in net revenues attributable to the increase (decrease) in concentrate sales volume for our geographic operating segments (expressed in equivalent unit cases) after considering the impact of structural changes. For our Bottling Investments operating segment, this represents the percent change in net revenues attributable to the increase (decrease) in unit case volume after considering the impact of structural changes. Our Bottling Investments operating segment reflects unit case volume growth for consolidated bottlers only.
· “Price/mix” represents the change in revenues caused by factors such as price changes, the mix of products and packages sold, and the mix of channels and geographic territories where the sales occurred.
· First quarter 2017 financial results were impacted by two fewer days and fourth quarter 2017 financial results will be impacted by one additional day as compared to the same periods in 2016. Unit case volume results are not impacted by variances in days due to the average daily sales computation referenced above.