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ATLANTA -- Coca-Cola Co. reported that its earnings dropped 71 percent in its fourth quarter, but its worldwide sales and volume, powered by expansion in emerging markets like China and India, grew.
According to a Dow Jones report, the company also said it planned to cut up to $650 million in annual costs by the end of 2015. The cost cuts come as the company's rival, PepsiCo Inc. was expected to announce about $500 million in cost cuts Thursday, according to the report.
Coca-Cola's net earnings for the fourth quarter fell from a year ago on a large gain last year from the purchase of some bottling operations. But, both earnings excluding items and revenues came in ahead of analysts' expectations.
Global volume grew 3 percent in the quarter, its weakest showing in 2011, although it still came within the company's long-term target for 3 percent to 4 percent growth. Volume grew 20 percent in India and 10 percent in China, boosted by the earlier Lunar New Year. Europe, which is being rattled by economic uncertainty, saw volume rise 1 percent, Dow Jones reported.
In North America, Coca-Cola's volume rose 1 percent. Sales got a 2-percent boost from a combination of higher prices and the mix of products sold, offering a cushion to help offset continuing pressure from rising commodity costs. Soda saw an even higher benefit as pricing and mix combined to raise retail prices 4 percent.
Coca-Cola, PepsiCo and Dr Pepper Snapple Inc. have all been trying to push through higher prices in recent years to grow sales at a time when soda sales overall are under pressure as consumers shift their preference to water, iced tea and other drinks. In addition to raising prices, Coca-Cola has also been trying to introduce new drink sizes like 1.25 liters for 99 cents or 12.5-ounce single-serve bottles for 89 cents.