Coca-Cola profit drops 32% as coronavirus closures push restaurant sales down
Coca-Cola Co.’s profit plunged 32% amid a sharp decline in restaurant and bar sales during closings aimed at slowing the spread of COVID-19.
The Atlanta-based beverage maker earned $ 1.78 billion, or adjusted 42 cents per share, as revenue fell 28% from a year ago to $ 7.15 billion. Wall Street analysts polled by Refinitiv expected adjusted earnings of 40 cents a share on revenues of $ 7.18 billion.
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“We believe the second quarter will be the toughest of the year,” Coca-Cola CEO James Quincy said in a statement.
The sales volume of so-called concentrates, cases of syrup carbonated and dispensed into non-alcoholic beverage fountains, fell 16% year-on-year, sales to bars and restaurants, which account for about the half of the income, were particularly affected. .
However, the company has seen an improvement since its first quarter results, with the decline falling from around 25% in April to just 10% in June as restrictions eased and businesses began to reopen.
Sales of brand-name Coca-Cola fell 7 percent in the quarter, while sales of Coca-Cola Zero were down 4 percent.
Meanwhile, sales of juices, dairy products and herbal beverages fell 20% due to weakness outside the United States, while sales of water, water improved and sports drinks fell 24%.
Lockdowns in Western Europe resulted in a 31% drop in tea and coffee sales for the company’s Costa brand.
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Going forward, Coca-Cola declined to give a forecast due to the uncertainty caused by COVID-19, but said it expects a 3-4% headwind for its revenue. net in full year.
Coca-Cola shares are down 17% year-to-date through Monday, trailing the S&P 500’s 0.65% gain.