In the past quarter, Coca-Cola has scored a hit with sugar-free, coffee and the Netflix hit Stranger Things. The soft drink group exceeds expectations with a 6% turnover growth.
Less sugar, more revenue
After releasing its great figures for the second quarter, The Coca-Cola Company was rewarded on the stock market with a record share price. In the past three months, turnover climbed up to 10 billion dollars (9 billion euros), which means 6.1% growth, just above the expectations of the analysts. Comparable turnover – without acquisitions and currency effects – increased by 6%. As such, turnover ended at 63 dollarcents per share, also more than Reuters analysts had foreseen.
The basis of growth is innovation, according to CEO James Quincey. A quarter of all turnover today comes from new or renewed products, which is 15% more than two years ago. “Our performance was largely driven by consumer demand for no sugar versions of some of our best-known sparkling soft drink brands as well as for the smaller packages for less sugar,” said the CEO, who also successfully released smaller packages in order to meet the demand for less sugar.
Coca-Cola has been recording double-digit growth for the past three years, aided by smaller packages and new tastes. Flagship product Coca-Cola generated six times more turnover volume within the second quarter. In terms of marketing, the group was able to ride the coattails of the huge success of Netflix series Stranger Things, since the soft drink manufacturer secured an advertising deal with the launch of the latest season.
New: coffee and cola in one
The acquisition of coffee chain Costa for 5 billion dollars (4.5 billion euros) last year, has turned out to be a fruitful investment. From now on, The Coca-Cola Company will also be selling coffee vending machines and coffee beans for catering, as well as three ready-made ice coffees by Costa Coffee for retail. In some markets, they’ll even have Coke coffee: a blend of coffee and cola.
For the full financial year, the company will be adjusting its expectations upwards: from 4% turnover growth to 5%. The soft drink manufacturer also believes operational profit will end up higher than expected as well.