Coca-Cola misses on Japan earthquake disruptions
Even though profit is up 18%, shares are down as the company comes in just below what analysts hoped to see. With video.
The company missed analyst expectations for profit and revenue as a result, and the stock dropped 2.5% in morning trading to $66.06. "The high exposure to Japan remains a major uncertainty," one Credit Suisse analyst wrote in a note this week, according to Bloomberg.
But even though Coca-Cola fell short of the mark, the company's first-quarter profit still grew 18%, largely because of its acquisition of the North American bottling operations from Coca-Cola Enterprises (CCE). Profit was $1.9 billion, or 82 cents a share, up sharply from $1.61 billion, or 69 cents a share, in the year-ago period.
Post continues after this analyst interview about Coca-Cola's earnings:
Excluding certain costs like restructuring charges, profit was 86 cents -- just a penny shy of what analysts were expecting. Revenue took a 40% leap to $10.52 billion, again a bit less than the $10.57 billion analysts wanted to see.
Coke's operating profit rose by 3% in the quarter, helped along by the weaker dollar, while gross margin fell to 62.5% from 66.2%.
The company's operations in Japan represent more than 10% of operating profit, Bloomberg reported. Coke's chief executive, Muhtar Kent, has offered more than $30 million in aid after the March 11 earthquake and tsunami.
Coca-Cola is recovering nicely this year, boosting sales volumes in North America for four straight quarters, Bloomberg reported. Worldwide volume grew 6% in the first quarter. But the increase in commodity and oil prices, along with soaring costs for raw ingredients, are taking a toll for both Coke and rival PepsiCo (PEP), and Coke has raised prices in North America. Pepsi reports earnings on Thursday.
Coca-Cola relied on emerging markets for much of its volume growth. The Eurasia and Africa region saw 8% growth, followed by 7% in Latin America, 5% in the Pacific and 1% in Europe. In North America, growth was 2% excluding cross-licensed brands primarily under the Dr Pepper Snapple Group (DPS).
The "still beverage" category, which includes juice, sports drink, tea and bottled water, was a star in the quarter. Worldwide volume rose 11% in the quarter, with 12% growth coming from overseas and 8% growth in North America. Minute Maid Pulpy, which originated in China, saw 25% growth.
Coca-Cola will celebrate its 125th birthday on May 8.
Copyright © 2013 Microsoft. All rights reserved.
Quotes are real-time for NASDAQ, NYSE and AMEX. See delay times for other exchanges.
Fundamental company data and historical chart data provided by Thomson Reuters (click for restrictions). Real-time quotes provided by BATS Exchange. Real-time index quotes and delayed quotes supplied by Interactive Data Real-Time Services. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by SIX Financial Information.
[BRIEFING.COM] The S&P 500 ended this week with a bang, roaring to a new all-time high on the back of stronger-than-expected economic data, influential leadership, and an ongoing appreciation for the Fed's monetary policy support.
The bullish bias was evident in premarket action as the S&P futures pointed to a higher start without the benefit of any definitive news catalyst. Stocks indeed benefited from a blast of buying interest at the opening bell on this ... More
More Market News
|There’s a problem getting this information right now. Please try again later.|
LATEST MARKET DISPATCHES
- No more Dispatches; here's where to find market news
The Market Dispatches column has been discontinued. Here's where to find the latest stock and business news on MSN Money, and the latest from market writer Charley Blaine.
- Dow falls 59 as late-day gloom kills a rally
- Stocks held back by fiscal-cliff worries
- Stocks suffer worst weekly loss in 5 months
- Dow off 121 as post-election swoon continues
- Dow slumps 313 after Obama's re-election
- Dow jumps 133 as Americans head to the polls
All hail the bull market, which ended the week with a big rally. But it also is starting to look a little like 1987, which suffered an epic blow-out.