Coca-Cola Co (NYSE: KO) stock fell 0.18% on Feb 11th, 2021 after-hours session (Source: Google finance) after the company posted mixed results for the fourth quarter of FY 20. KO has reported fourth-quarter net income of $1.46 billion, down from $2.04 billion, a year earlier. In response to the pandemic, the company has accelerated its workforce restructuring and slimmed down its portfolio. The company has recorded a $15 million charge related to these efforts and a $4 million benefit from discontinuing its Odwalla brand. About 11% of Coke’s global jobs have been cut, excluding its bottling investments and global ventures segments. Coke projects to spend $350 million to $550 million on severance.
KO in the fourth quarter of FY 20 has reported the adjusted earnings per share of 47 cents, beating the analysts’ estimates for the adjusted earnings per share of 42 cents, according a survey of analysts by Refinitiv. The company had reported 5 percent fall in the adjusted revenue to $8.6 billion in the fourth quarter of FY 20, whereas the analysts had estimated the revenue to be of $8.63 billion. Organic revenue, fell 3% in the quarter. Unit case volume declined by 3% during the period. All four of its beverage segments reported volume declines, and Latin America was the only geographic region to report volume growth. The company said the resurgence of the virus around the world in December and January has put pressure on demand. So far in February, global volume has fallen by mid-single digits.
Moreover, in the fourth quarter, sparkling soft drinks saw volume fell by 1%. Its namesake soda reported volume growth of 1% in the period, and Coke Zero Sugar’s volume rose 3%. The company’s juice, dairy and plant-based beverage segment saw volume decline by 2%. While Coke’s Simply juice and Fairlife milk performed well, they were not enough to offset a decline in the Minute Maid fountain business. Volume of its water, enhanced water and sports drinks declined by 9%. But its tea and coffee business reported the biggest contraction in volume. Demand fell 15%, mainly due to the pressure on its Costa cafes and Dogadan tea brand in Turkey.
Coke is projecting organic revenue growth in 2021 in the high single digits and adjusted earnings growth in a range of high single digits to low double digits. The analysts were projecting that full-year 2021 earnings would grow 10.5% to $2.10.