Published - Apr 26, 2022 @ 11:51 AM (EET)
As rising inflation, the Russian-Ukraine war, and economic turmoil persists, investors seem to have found comfort in a bubbling favorite.
Despite an uncertain operating environment, The Coca-Cola Company (NYSE:KO) has reported better-than-expected first-quarter results for 2022, benefiting from strategic transformation.
So far, shares of the company are up 10.2% this year, rising further by about 1% on Monday morning after the earnings beat.
Coke's organic revenue, which strips out currency swings, acquisitions, and divestitures, rose 18% to $10.5 billion in the quarter and benefited from higher prices and the mix of products sold.
Global unit case volume rose 8%, and concentrate sales were 11% higher. Though the beverage giant's cash flow from operations and free cash flow were both down about $1 billion from year-ago numbers, Coca-Cola expects to maintain its long-term growth. Full-year revenue rose 7% to 8%, and adjusted earnings rose 8% to 10% on a currency-neutral basis.
While financial results were better than analysts had projected, Coca-Cola stuck to its full-year earnings guidance, including predictions of higher commodity prices than the year earlier.
Chief Executive James Quincey told analysts on a conference call Monday, "We continue to believe the recovery in 2022 will be asynchronous," adding that this year's operating environment proves to be more challenging than expected.
RETURN TO REFILLABLE GLASS BOTTLES
With rampant inflation showing no signs of cooling, Coca-Cola warned Monday that consumer demand could slow and said it would focus more on affordable and refillable glass bottles in markets facing the biggest pinch from price increases.
The returnable glass bottles will initially be available in Hong Kong, South America, and Africa, with the possibility of expansion in the Southwestern U.S., according to Reuters.
In addition, the bottles which use 60% recycled glass materials make the move environmentally friendly, allowing consumers to return the bottles for reuse.
In the last year, Coca-Cola stock has increased in value by 25% and around 13% so far this year.
