ATLANTA--(BUSINESS WIRE)--The Coca-Cola Company today reported fourth quarter and full year 2024 results. "Our all-weather strategy is working, and we continue to demonstrate our ability to lead through dynamic external environments," said James Quincey, Chairman and CEO of The Coca-Cola Company. "Our global scale, coupled with local-market expertise and the unwavering dedication of our people and our system, uniquely position us to capture the vast opportunities ahead."
Highlights |
Quarterly/Full Year Performance |
- Revenues: For the quarter, net revenues increased 6% to $11.5 billion, and organic revenues (non-GAAP) grew 14%, driven by 9% growth in price/mix and a 5% increase in concentrate sales. Concentrate sales were 3 points ahead of unit case volume, primarily driven by two additional days and the timing of concentrate shipments. For the full year, net revenues grew 3% to $47.1 billion, and organic revenues (non-GAAP) grew 12%, driven by 11% growth in price/mix and 2% growth in concentrate sales. Concentrate sales were 1 point ahead of unit case volume, primarily due to the timing of concentrate shipments.
- Operating margin: For the quarter, operating margin was 23.5% versus 21.0% in the prior year, while comparable operating margin (non-GAAP) was 24.0% versus 23.1% in the prior year. For the full year, operating margin was 21.2% versus 24.7% in the prior year, while comparable operating margin (non-GAAP) was 30.0% versus 29.1% in the prior year. For both the quarter and the full year, operating margin performance included items impacting comparability, as well as currency headwinds. Full year operating margin included a charge of $3.1 billion related to the remeasurement of the contingent consideration liability to fair value in conjunction with the acquisition of fairlife, LLC ("fairlife") in 2020. For both the quarter and the full year, comparable operating margin (non-GAAP) expansion was primarily driven by strong organic revenue (non-GAAP) growth and the impact of refranchising bottling operations, partially offset by higher input costs, higher operating expenses and currency headwinds.
- Earnings per share: For the quarter, EPS grew 12% to $0.51, while comparable EPS (non-GAAP) grew 12% to $0.55. EPS performance included the impact of a 1-point currency headwind, while comparable EPS (non-GAAP) performance included the impact of an 11-point currency headwind. For the full year, EPS declined slightly to $2.46, while comparable EPS (non-GAAP) grew 7% to $2.88. EPS and comparable EPS (non-GAAP) performance both included the impact of a 9-point currency headwind.
- Market share: For both the quarter and the full year, the company gained value share in total nonalcoholic ready-to-drink ("NARTD") beverages.
- Cash flow: For the full year, cash flow from operations and free cash flow (non-GAAP) were $6.8 billion and $4.7 billion, respectively. Both decreased versus the prior year, primarily due to a $6.0 billion deposit made to the U.S. Internal Revenue Service ("IRS") related to ongoing tax litigation ("IRS tax litigation deposit"). Free cash flow excluding the IRS tax litigation deposit (non-GAAP) was $10.8 billion, an increase of $1.0 billion versus the prior year, largely due to strong business performance and working capital benefits, partially offset by higher other tax payments and higher capital expenditures.
Company Updates |
- Offering a brand portfolio across compelling package offerings: The company, in close alignment with its bottling partners, continues to exemplify leadership in revenue growth management ("RGM") by offering relevant global and local brands in a variety of packages at the right price points to meet consumer needs. Returnable glass bottles offer a unique competitive advantage, having an expansive footprint for the company across more than 110 countries and, in 2024, added 1.6 billion unit cases to total company volume performance, with a growth rate that outpaced total company volume growth. Returnable glass bottles are important to the company's RGM capabilities, serving as both an affordable and premium package that can be tailored to local market needs. In developed markets across Western Europe, the bottle is a key premium package in away-from-home channels. In certain developing and emerging markets, returnable glass bottles are an affordable offering that enables the company to recruit consumers and develop the commercial beverage industry. In 2018, the company launched a universal returnable glass bottle in Latin America, aimed at further reducing input costs, increasing collectability and expanding beverage offerings. The universal bottle has quickly expanded to markets around the world, including Germany, South Africa and Vietnam, with more opportunities ahead.
- Stepping up key execution levers to drive recruitment: The company's global franchise system is increasing outlet coverage and accelerating the placement of cold-drink equipment across local markets to drive consumer recruitment and long-term balanced revenue growth. In 2024, the Coca-Cola system increased availability by adding more than 250,000 net new outlets and nearly 600,000 new coolers. Increasing cold-drink equipment is critical to drive transactions and expand the consumer base, as coolers are one of the strongest enablers for transaction growth, especially in traditional trade channels where approximately 90% of NARTD beverages are served cold. These actions contributed to the company growing volume and gaining value share for both the quarter and the full year.
Operating Review - Three Months Ended December 31, 2024 |
Revenues and Volume
Percent Change | Concentrate
| Price/Mix | Currency
| Acquisitions,
| Reported Net
| Organic
| Unit Case
| ||
Consolidated | 5 | 9 | (3) | (5) | 6 | 14 | 2 | ||
Europe, Middle East & Africa | 6 | 11 | (11) | 0 | 6 | 17 | 0 | ||
Latin America | 3 | 23 | (15) | 0 | 10 | 25 | 2 | ||
North America | 4 | 12 | 0 | 0 | 16 | 15 | 1 | ||
Asia Pacific | 6 | (5) | 8 | 0 | 9 | 1 | 6 | ||
Global Ventures4 | 10 | (7) | 2 | 0 | 5 | 3 | 3 | ||
Bottling Investments | 4 | 2 | 0 | (30) | (23) | 7 | (26) |
Operating Income and EPS
Percent Change | Reported
| Items Impacting
| Currency Impact | Comparable
|
Consolidated | 19 | 11 | (14) | 22 |
Europe, Middle East & Africa | 2 | 7 | (20) | 14 |
Latin America | 24 | 1 | (24) | 46 |
North America | 29 | 3 | 0 | 26 |
Asia Pacific | 24 | 35 | (5) | (6) |
Global Ventures | 14 | 4 | 1 | 9 |
Bottling Investments | 8 | 7 | 4 | (3) |
Percent Change | Reported EPS | Items Impacting
| Currency Impact | Comparable
|
Consolidated | 12 | (1) | (11) | 23 |
Note: Certain rows may not add due to rounding. |
1 For Bottling Investments, this represents the percent change in net revenues attributable to the increase (decrease) in unit case volume computed based on total sales (rather than average daily sales) in each of the corresponding periods after considering the impact of structural changes, if any. |
2 Organic revenues, comparable currency neutral operating income and comparable currency neutral EPS are non-GAAP financial measures. Refer to the Reconciliation of GAAP and Non-GAAP Financial Measures section. |
3 Unit case volume is computed based on average daily sales. |
4 Due to the combination of multiple business models in the Global Ventures operating segment, the composition of concentrate sales and price/mix may fluctuate materially from period to period. Therefore, the company places greater focus on revenue growth as the best indicator of underlying performance of the Global Ventures operating segment. |
Operating Review - Year Ended December 31, 2024 |
Revenues and Volume
Percent Change | Concentrate
| Price/Mix | Currency
| Acquisitions,
| Reported Net
| Organic
| Unit Case
| ||
Consolidated | 2 | 11 | (5) | (4) | 3 | 12 | 1 | ||
Europe, Middle East & Africa | (1) | 17 | (16) | 0 | 1 | 16 | 0 | ||
Latin America | 3 | 21 | (14) | 0 | 11 | 25 | 3 | ||
North America | 1 | 10 | 0 | 0 | 11 | 11 | 0 | ||
Asia Pacific | 2 | 2 | (3) | 0 | 2 | 4 | 1 | ||
Global Ventures3 | 4 | (3) | 2 | 0 | 2 | 1 | 2 | ||
Bottling Investments | 5 | 5 | (2) | (28) | (21) | 9 | (23) |
Operating Income and EPS
Percent Change | Reported
| Items Impacting
| Currency Impact | Comparable
|
Consolidated | (12) | (17) | (11) | 16 |
Europe, Middle East & Africa | (2) | 1 | (16) | 14 |
Latin America | 10 | (2) | (18) | 31 |
North America | (2) | (16) | 0 | 14 |
Asia Pacific | 5 | 6 | (6) | 5 |
Global Ventures | 9 | 1 | 1 | 8 |
Bottling Investments | (14) | 1 | (1) | (15) |
Percent Change | Reported EPS | Items Impacting
| Currency Impact | Comparable
|
Consolidated | 0 | (8) | (9) | 17 |
Note: Certain rows may not add due to rounding. |
1 For Bottling Investments, this represents the percent change in net revenues attributable to the increase (decrease) in unit case volume after considering the impact of structural changes, if any. |
2 Organic revenues, comparable currency neutral operating income and comparable currency neutral EPS are non-GAAP financial measures. Refer to the Reconciliation of GAAP and Non-GAAP Financial Measures section. |
3 Due to the combination of multiple business models in the Global Ventures operating segment, the composition of concentrate sales and price/mix may fluctuate materially from period to period. Therefore, the company places greater focus on revenue growth as the best indicator of underlying performance of the Global Ventures operating segment |
In addition to the data in the preceding tables, operating results included the following:
Consolidated |
- Unit case volume grew 2% for the quarter, led by China, Brazil and the United States. For the full year, unit case volume grew 1%, led by Brazil, India and Mexico.
Unit case volume performance included the following:
- Sparkling soft drinks grew 2% for both the quarter and the full year. For the quarter, performance was driven by growth across all geographic operating segments and, for the full year, growth was driven by Latin America, Asia Pacific and North America. Trademark Coca-Cola grew 2% for both the quarter and the full year, driven by growth in Latin America, Asia Pacific and North America. Coca-Cola Zero Sugar grew 13% for the quarter and 9% for the full year, both driven by growth across all geographic operating segments. Sparkling flavors grew 2% for the quarter and 1% for the full year, both primarily driven by growth in Asia Pacific and North America.
- Juice, value-added dairy and plant-based beverages declined 1% for the quarter and were even for the full year, as growth in North America was offset by declines in Europe, Middle East and Africa.
- Water, sports, coffee and tea grew 2% for the quarter and declined 1% for the full year. Water grew 2% for the quarter and declined 2% for the full year. For the quarter, water performance was primarily driven by growth in Europe, Middle East and Africa, Latin America and Asia Pacific and, for the full year, growth in Latin America and Europe, Middle East and Africa was more than offset by a decline in Asia Pacific. Sports drinks declined 2% for the quarter and 1% for the full year as growth in Europe, Middle East and Africa was more than offset by declines in North America and Asia Pacific. Coffee declined 1% for the quarter and 3% for the full year, primarily due to the performance of Costa® coffee in the United Kingdom. Tea grew 5% for the quarter and 4% for the full year. For the quarter, growth was driven by all geographic operating segments and, for the full year, growth was driven primarily by Asia Pacific and Europe, Middle East and Africa.
- Price/mix grew 9% for the quarter and 11% for the full year. For the quarter, approximately 4 points were driven by pricing from markets experiencing intense inflation, with the remainder driven by pricing actions in the marketplace and favorable mix. Concentrate sales were 3 points ahead of unit case volume, primarily due to two additional days and the timing of concentrate shipments. For the full year, approximately 5 points were driven by pricing from markets experiencing intense inflation, with the remainder driven by pricing actions in the marketplace and favorable mix. Concentrate sales were 1 point ahead of unit case volume, primarily due to the timing of concentrate shipments.
- Operating income grew 19% for the quarter and declined 12% for the full year, which included items impacting comparability and currency headwinds. Comparable currency neutral operating income (non-GAAP) grew 22% for the quarter and 16% for the full year. For the quarter, comparable currency neutral operating income (non-GAAP) performance was driven by organic revenue (non-GAAP) growth across all operating segments, partially offset by higher input costs and operating expenses. For the full year, performance was driven by organic revenue (non-GAAP) growth across all operating segments, partially offset by an increase in marketing investments, higher input costs and higher operating expenses.
Europe, Middle East & Africa |
- Unit case volume was even for the quarter as growth in water, sports, coffee and tea and sparkling flavors was offset by a decline in juice, value-added dairy and plant-based beverages.
- Price/mix grew 11% for the quarter, primarily driven by pricing from markets experiencing intense inflation as well as pricing actions across operating units, partially offset by unfavorable mix. For the quarter, concentrate sales were 6 points ahead of unit case volume, primarily due to the timing of concentrate shipments and two additional days.
- Operating income grew 2% for the quarter, which included items impacting comparability and a 13-point currency headwind. Comparable currency neutral operating income (non-GAAP) grew 14% for the quarter, primarily driven by strong organic revenue (non-GAAP) growth, partially offset by higher input costs and marketing investments.
- For the full year, the company gained value share in total NARTD beverages, led by share gains in Nigeria, Romania and France.
Latin America |
- Unit case volume grew 2% for the quarter, primarily driven by growth in Trademark Coca-Cola.
- Price/mix grew 23% for the quarter. More than half of the growth was driven by the impact of inflationary pricing in Argentina, with the remainder driven by favorable mix and pricing actions in the marketplace. For the quarter, concentrate sales were 1 point ahead of unit case volume, primarily due to two additional days, partially offset by the timing of concentrate shipments.
- Operating income increased 24% for the quarter, which included items impacting comparability and an 18-point currency headwind. Comparable currency neutral operating income (non-GAAP) grew 46% for the quarter, primarily driven by strong organic revenue (non-GAAP) growth and marketing efficiencies, partially offset by higher operating expenses.
- For the full year, the company gained value share in total NARTD beverages, led by share gains in Colombia, Brazil and Mexico.
North America |
- Unit case volume grew 1% for the quarter, primarily driven by growth in sparkling flavors, juice, value-added dairy and plant-based beverages, and Trademark Coca-Cola.
- Price/mix grew 12% for the quarter, driven by pricing actions in the marketplace and favorable mix. For the quarter, concentrate sales were 3 points ahead of unit case volume, primarily due to two additional days and the timing of concentrate shipments.
- Operating income grew 29% for the quarter, which included items impacting comparability and a 2-point currency tailwind. Comparable currency neutral operating income (non-GAAP) grew 26% for the quarter, primarily driven by strong organic revenue (non-GAAP) growth, partially offset by higher input costs and marketing investments.
- For the full year, the company gained value share in total NARTD beverages, driven by share gains in Trademark Coca-Cola and juice, value-added dairy and plant-based beverages.
Asia Pacific |
- Unit case volume grew 6% for the quarter, primarily driven by growth in Trademark Coca-Cola and sparkling flavors.
- Price/mix declined 5% for the quarter, driven by unfavorable mix, partially offset by pricing actions in the marketplace. For the quarter, concentrate sales were in line with unit case volume.
- Operating income grew 24% for the quarter, which included items impacting comparability and a 31-point currency tailwind. Comparable currency neutral operating income (non-GAAP) declined 6% for the quarter, as organic revenue (non-GAAP) growth was more than offset by higher input costs and an increase in marketing investments.
- For the full year, total NARTD beverages value share for the company was even, as growth in the Philippines, South Korea and Japan was offset by declines in Indonesia and Bangladesh.
Global Ventures |
- Net revenues grew 5% and organic revenues (non-GAAP) grew 3% for the quarter, primarily driven by product mix.
- Operating income grew 14% for the quarter, which included items impacting comparability and a 1-point currency tailwind. Comparable currency neutral operating income (non-GAAP) grew 9% for the quarter, driven by product mix.
Bottling Investments |
- Unit case volume declined 26% for the quarter, largely due to the impact of refranchising bottling operations.
- Price/mix grew 2% for the quarter, driven by pricing actions across markets.
- Operating income grew 8% for the quarter, which included items impacting comparability, a 5-point currency tailwind and the impact of refranchising bottling operations. Comparable currency neutral operating income (non-GAAP) declined 3% for the quarter.
Capital Allocation Update |
- Reinvesting in the business: The company continued to invest in its various lines of business and spent $2.1 billion on capital expenditures in 2024, an increase of 11% versus the prior year.
- Continuing to grow the dividend: The company paid dividends totaling $8.4 billion during 2024. The company has increased its dividend in each of the last 62 years.
- M&A initiatives: In 2024, the company did not make any significant acquisitions. The company continues to evaluate inorganic growth opportunities through brands and capabilities. In 2024, with respect to divestitures, the company made progress towards refranchising company-owned bottling operations.
- Share repurchases: In 2024, the company issued $0.7 billion of shares in connection with the exercise of stock options by employees and purchased $1.8 billion of shares. Consequently, net share repurchases (non-GAAP) were $1.1 billion. The company's remaining share repurchase authorization is approximately $4.9 billion.
Outlook |
The 2025 outlook information provided below includes forward-looking non-GAAP financial measures, which management uses in measuring performance. The company is not able to reconcile full year 2025 projected organic revenues (non-GAAP) to full year 2025 projected reported net revenues, full year 2025 projected comparable net revenues (non-GAAP) to full year 2025 projected reported net revenues, full year 2025 projected underlying effective tax rate (non-GAAP) to full year 2025 projected reported effective tax rate, full year 2025 projected comparable currency neutral EPS (non-GAAP) to full year 2025 projected reported EPS, or full year 2025 projected comparable EPS (non-GAAP) to full year 2025 projected reported EPS without unreasonable efforts because it is not possible to predict with a reasonable degree of certainty the exact timing and exact impact of acquisitions, divestitures and structural changes throughout 2025; the exact timing and exact amount of items impacting comparability throughout 2025; and the exact impact of fluctuations in foreign currency exchange rates throughout 2025. The unavailable information could have a significant impact on the company's full year 2025 reported financial results.
Full Year 2025
The company expects to deliver organic revenue (non-GAAP) growth of 5% to 6%.
For comparable net revenues (non-GAAP), the company expects a 3% to 4% currency headwind based on the current rates and including the impact of hedged positions, in addition to a slight headwind from acquisitions, divestitures and structural changes.
The company's underlying effective tax rate (non-GAAP) is estimated to be 20.8% versus 18.6% in 2024. This includes the impact of several countries enacting the global minimum tax regulations and does not include the impact of ongoing tax litigation with the IRS, if the company were not to prevail.
The company expects to deliver comparable currency neutral EPS (non-GAAP) growth of 8% to 10%.
The company expects comparable EPS (non-GAAP) growth of 2% to 3%, versus $2.88 in 2024.
Comparable EPS (non-GAAP) percentage growth is expected to include a 6% to 7% currency headwind based on the current rates and including the impact of hedged positions, in addition to a slight headwind from acquisitions, divestitures and structural changes.
The company expects to generate free cash flow excluding the fairlife contingent consideration payment (non-GAAP) of approximately $9.5 billion. This consists of cash flow from operations excluding the fairlife contingent consideration payment (non-GAAP) of approximately $11.7 billion, less capital expenditures of approximately $2.2 billion.
First Quarter 2025 Considerations
Comparable net revenues (non-GAAP) are expected to include a 3% to 4% currency headwind based on the current rates and including the impact of hedged positions, in addition to a 2% to 3% headwind from acquisitions, divestitures and structural changes.
Comparable EPS (non-GAAP) percentage growth is expected to include a 5% to 6% currency headwind based on the current rates and including the impact of hedged positions, in addition to a 2% to 3% headwind from acquisitions, divestitures and structural changes.
The first quarter has two fewer days compared to first quarter 2024.
Notes |
- All references to growth rate percentages and share compare the results of the period to those of the prior year comparable period, unless otherwise noted.
- All references to volume and volume percentage changes indicate unit case volume, unless otherwise noted. All volume percentage changes are computed based on average daily sales in the fourth quarter, unless otherwise noted, and are computed on a reported basis for the full year. "Unit case" means a unit of measurement equal to 192 U.S. fluid ounces of finished beverage (24 eight-ounce servings), with the exception of unit case equivalents for Costa non-ready-to-drink beverage products which are primarily measured in number of transactions. "Unit case volume" means the number of unit cases (or unit case equivalents) of company beverages directly or indirectly sold by the company and its bottling partners to customers or consumers.
- "Concentrate sales" represents the amount of concentrates, syrups, beverage bases, source waters and powders/minerals (in all instances expressed in unit case equivalents) sold by, or used in finished beverages sold by, the company to its bottling partners or other customers. For Costa non-ready-to-drink beverage products, "concentrate sales" represents the amount of beverages, primarily measured in number of transactions (in all instances expressed in unit case equivalents) sold by the company to customers or consumers. In the reconciliation of reported net revenues, "concentrate sales" represents the percent change in net revenues attributable to the increase (decrease) in concentrate sales volume for the geographic operating segments and the Global Ventures operating segment after considering the impact of structural changes, if any. For the Bottling Investments operating segment for the fourth quarter, this represents the percent change in net revenues attributable to the increase (decrease) in unit case volume computed based on total sales (rather than average daily sales) in each of the corresponding periods after considering the impact of structural changes, if any. For the Bottling Investments operating segment for the full year, this represents the percent change in net revenues attributable to the increase (decrease) in unit case volume after considering the impact of structural changes, if any. The Bottling Investments operating segment reflects unit case volume growth for consolidated bottlers only.
- "Price/mix" represents the change in net operating revenues caused by factors such as price changes, the mix of products and packages sold, and the mix of channels and geographic territories where the sales occurred.
- First quarter 2024 financial results were impacted by one less day as compared to first quarter 2023, and fourth quarter 2024 financial results were impacted by two additional days as compared to fourth quarter 2023. Unit case volume results for the quarters are not impacted by the variances in days due to the average daily sales computation referenced above.
Conference Call |
The company is hosting a conference call with investors and analysts to discuss fourth quarter and full year 2024 operating results today, Feb. 11, 2025, at 8:30 a.m. ET. The company invites participants to listen to a live webcast of the conference call on the company's website, http://www.coca-colacompany.com, in the "Investors" section. An audio replay in downloadable digital format and a transcript of the call will be available on the website within 24 hours following the call. Further, the "Investors" section of the website includes certain supplemental information and a reconciliation of non-GAAP financial measures to the company's results as reported under GAAP, which may be used during the call when discussing financial results.
Contacts
Investors and Analysts: Robin Halpern, koinvestorrelations@coca-cola.com
Media: Scott Leith, sleith@coca-cola.com
View source version on businesswire.com: https://www.businesswire.com/news/home/20250211158506/en/
