The Coca-Cola Co (NYSE: KO) has posted better than expected results in the fourth quarter of FY 17 as the company sold more teas, coffees and vitamin water. In the fourth quarter of FY 17, KO has reported a net loss of $2.75 billion, mainly due to a $3.6 billion charge related to the new tax law. A year earlier the company had posted a profit of $550 million. The revenues plunged as the company sold off its bottling operations. The Industry analysts have anticipated both as the company reshapes its operations, and as a result, KO shares rose up 2.4 percent.
KO in the fourth quarter of FY 17 has reported the adjusted earnings per share of 39 cents, beating the analysts’ estimates for the adjusted earnings per share of 38 cents. The company had reported the adjusted revenue fell to $7.51 billion in the fourth quarter of FY 17 from from $9.41 billion a year earlier, beating the analysts’ estimates for revenue of $7.36 billion.
Moreover, Organic sales, that exclude the impact of the company’s ongoing efforts to refranchise its bottling operations, grew 6 percent, on the back of demand for products such as Georgia Coffee and Glaceau vitamin water. However, the global volume growth has remained unchanged even as North America volumes expanded 1 percent. Further, KO’s margins have improved by 3.15 percentage points, mainly due to divestitures of lower-margin bottling businesses. The company is also successful in raising prices while maintaining consumers’ attention with new products.
Meanwhile, KO through its investment arm, has acquired or invested in Honest Tea, Fairlife dairy and Suja Life LLC, that makes high-pressure processed juices, kombucha and drinking vinegars. The company is expanding its venture model beyond the U.S. and has already started looking for investment candidates in Central and Eastern Europe.
In addition to adding new products, KO has planned to revive one of its biggest sellers, the Diet Coke. The company has relaunched the zero-calorie cola with four additional flavors in taller, skinnier cans, which is the biggest-ever makeover for the product. The company had previously revamped its Coke Zero with a new formula, that helped to boost results in the third quarter.