ATLANTA — The Coca-Cola Co. said net income rose 1% in 2005 as the beverage company gained worldwide share in sports drinks, juice and juice drinks, and packaged water. Net income of $4,872 million, or $2.04 per share, for the year ended Dec. 31, 2005, compared with $4,847 million, or $2 per share, for the year ended Dec. 31, 2004. Net sales of $23,104 million for fiscal year 2005 marked a 6% increase from $21,742 million in 2004.
For the fourth quarter ended Dec. 31, 2005, net income was $864 million, or 36c per share, a 28% decline from $1,201 million, or 50c per share, in the previous year’s fourth quarter. Increases in cost of goods sold and marketing and innovation expenses offset an increase in net sales in the fourth quarter. Net sales of $5,551 million were 7% higher than $5,204 million in the previous year’s fourth quarter.
"This quarter we made further progress toward achieving consistent top-line growth in our business," said Neville Isdell, chairman and chief executive officer. "It completes a transition year in which the company delivered solid unit case volume growth that was well balanced between carbonated soft drinks and noncarbonated beverages."
Coca-Cola maintained share in the nonalcoholic ready-to-drink category. The company lost share in teas and coffees, areas where it intends to focus on in 2006.
In the fourth quarter of 2005, Coca-Cola reported unit case volume growth for carbonated soft drinks (2%), noncarbonated beverages excluding water (12%) and water (17%). Trademarks Powerade, Dasani and Minute Maid all grew unit case volume by double-digit percentages for both the fourth quarter and the full year.
In North America, operating income decreased 3% for the year because of a planned double-digit percentage increase in marketing expense and higher input costs such as freight and packaging costs. Operating income dropped 4% in the fourth quarter.
Carbonated beverages in North America rose 1% in unit case volume thanks to the success of Coca-Cola Zero, which has a 0.9 share in the category, and Diet Coke Sweetened with Splenda. New Fresca flavors and the Full Throttle energy drink contributed to unit case volume and share growth in carbonated beverages.
Noncarbonated beverages grew 10% in North America in the fourth quarter. Trademarks Powerade and Dasani continued double-digit growth.
In the European Union, operating income increased 24% for the year primarily as a result of cycling a charge related to the impairment of intangible assets in Germany in the prior year. For the fourth quarter, E.U. operating income dipped 4% because of continued weakness in northwest Europe.
In North Asia, Eurasia and the Middle East, operating income increased 5% for the full year and 18% for the fourth quarter. In Latin America, operating income increased 13% for the year and 11% for the quarter.
In East, South Asia and the Pacific Rim, operating income decreased 42% for the year and 22% for the quarter. Unit case volume declines in India and the Philippines impacted results negatively. A planned increase in marketing expense and the non-cash charge for asset write-downs in the Philippines in the third quarter further reduced operating income for the year.
In Africa, operating income rose 22% for the year and 32% for the quarter.