|Double-digit growth in the mini cans and 16-oz immediate consumption packages drove over 60% of the volume growth in brand Coca-Cola in the second quarter.|
ATLANTA – Executives of the Coca-Cola Co. could speak about volume growth in the company’s flagship brand even though net income dropped 3% in the second quarter ended June 27. Global volume growth of 3% included a 2% increase in sparkling beverages, said Muhtar Kent, chairman and chief executive officer, in a July 22 earnings conference call.
The Coca-Cola brand beverages grew 1% in volume, both globally and in North America. The flavored sparking portfolio also performed well in North America with Fanta up 4% and Sprite up 2%.
“The growth of brand Coca-Cola in North America in the second quarter gives us confidence that our focus on driving incidents, delivering best-in-class marketing and evolving our price pack architecture is setting the foundation for well-balanced growth in our flagship market,” Mr. Kent said. “Through these efforts, we are reviving the romance of brand Coca-Cola, driving household penetration and increasing consumption frequency, all of which contributed to growth in the second quarter.”
Double-digit growth in the mini cans and 16-oz immediate consumption packages drove over 60% of the volume growth in brand Coca-Cola in the second quarter, he said.
Softness in Diet Coke tempered the growth in the core sparkling brands.
“Diet Coke and Coca-Cola Light declined mid-single digits,” Mr. Kent said. “While this was a sequential improvement from the first quarter, we also recognize that we have more work to do here.”
Sports drinks, tea, energy, coffee and water all contributed to global volume growth of 5% in Coca-Cola’s still beverage portfolio. Tea volume grew 6% in North America, driven by double-digit growth for Gold Peak and Honest Tea.
Coca-Cola had second-quarter net income of $2,605 million, or 58c per diluted share, which was down 3% from $2,694 million, or 59c per diluted share, in the second quarter of the previous year. Net operating revenues of $12,574 million were down 1% from $12,749 million.
Operating income decreased 2% in the second quarter to $3,170 million from $3,243 million. Excluding the impact of structural changes, comparable currency neutral operating income increased 5%. Structural changes were a 3% headwind and currency was a 4% headwind on comparable operating income.
In North America, operating income of $827 million in the second quarter was up 13% from $731 million. Second-quarter net operating revenues of $5,717 million were up slightly from $5,713 million.Coca-Cola companywide through the six-month period ended June 27 had net income of $4,231 million, or 95c per diluted share, which was down 5% from $4,463 million, or 98c per diluted share, in the same time period of the previous year. Six-month net operative revenues of $23,150 million were down 3% from $23,784 million.