Coca-Cola reports single-digit global volume growth in 2014
2015 to be transition year, company notes
Atlanta-based The Coca-Cola Co. released its fourth quarter and full-year 2014 results. It reported that global sparkling beverage volume grew 1 percent in both the quarter and full year driven by growth from the Coca-Cola, Sprite and Fanta brands. Coca-Cola brand volume was up 1 percent in the quarter and grew slightly for the full year, rounding to even.
Global still beverage volume grew 2 percent in the quarter and 4 percent for the full year driven by growth in ready-to-drink tea, sports drinks and packaged water. Volume growth in these beverage categories was partially offset by a decline in juice and juice drinks, due in part to price increases to cover higher input costs, the company reports.
Full-year cash from operations was $10.6 billion, up 1 percent, primarily because of the efficient management of working capital and cycling incremental pension contributions last year, partially offset by an unfavorable impact from foreign currency exchange rate fluctuations and the deconsolidation of the company’s Brazilian bottling operations in July 2013, the company reports.
However, the company also reported that reported net revenues were down 2 percent for the quarter as well as for the full year; excluding the impact of structural items, comparable currency neutral net revenues increased 4 percent for the quarter and 3 percent for the year, it adds.
“We are making solid progress on the implementation of the strategic initiatives we announced in October as evidenced by some early positive signs in the quarter,” said Muhtar Kent, chairman and chief executive officer of The Coca-Cola Co., in a statement. “We remain resolutely focused on accelerating growth and taking advantage of opportunities to solidify our position in key markets and categories. However, we continue to see 2015 as a transition year as the benefits from the announced initiatives will take time to materialize amidst an uncertain and volatile macroeconomic environment. We remain confident that we have the right strategies in place, and our associates and bottling partners are embracing these initiatives and are enthusiastic about the opportunity ahead. We will continue to strengthen our brand portfolio and leverage our unparalleled global distribution system to create sustainable long-term shareowner value.”
For the full year, reported good accepted accounting principles (GAAP) net operating revenues were just shy of $46 billion, which is below 2013 reported GAAP net operating revenues of $46.8 billion.
In North America, structurally adjusted comparable currency neutral net revenues increased 5 percent in the quarter primarily because of a 4 percent increase in price/mix and the benefit of an additional selling day, the company states.
Comparable currency neutral operating income was up 7 percent for the quarter, reflecting structurally adjusted comparable currency neutral net-revenue growth and a favorable impact from commodities, partially offset by increased brand investments and the impact of structural items. For the year, structurally adjusted comparable currency neutral net revenue was up 1 percent.
Growth in concentrate sales lagged growth in unit case sales in the quarter primarily due to timing of shipments, partially offset by the impact of an additional selling day, the company states. Concentrate sales and unit case sales were mostly in line for the full year, it added.
The company also reported a continued rational approach to pricing, incremental media investments and disciplined price and pack strategies drove value share gains in total non-alcoholic ready-to-drink beverages, making this the 19th consecutive quarter of value share gains. The company also gained volume and value share in sparkling and still beverages as well as in the juice and juice drinks and ready-to-drink tea categories. The Coca-Cola brand also grew slightly in the United States in both the quarter and full year.
Going forward, The Coca-Cola Co. says it will continue to take steps to strengthen its brand portfolio in fast-growing categories and key markets as evidenced by Gold Peak Tea, Fuze Tea and I Lohas mineral water joining its portfolio of billion-dollar brands in 2014, bringing the total number of billion-dollar brands to 20.