Coca-Cola's Q4 US Demand Takes Hit, Still Expects FY24 Organic Revenue Growth

Coca-Cola Company KO reported fourth-quarter 2023 sales of $10.8 billion, up 7% Y/Y, beating the consensus of $10.67 billion.

Organic revenues grew 12%, driven by 9% growth in price/mix and 3% in concentrate sales.

The adjusted EPS of $0.49 came in line with the consensus estimate.

Global unit case volume grew 2% for the quarter and 2% for the full year.

Sparkling soft drinks grew 2% for the quarter and the full year, primarily driven by Latin America and Asia Pacific growth. 

Related: Coca-Cola Likely To Report Higher Q4 Earnings; Here Are The Recent Forecast Changes From Wall Street’s Most Accurate Analysts.

Developed markets were even as declines in the U.S. and Chile offset growth in Mexico and Germany. Developing and emerging markets grew by 4%, driven by growth in Brazil and India.

Juice, value-added dairy, and plant-based beverages grew 6%. Water, sports, coffee, and tea were even for the quarter. Water grew 1% for the quarter, primarily driven by growth in Latin America. Sports drinks declined 1% for the quarter.

Operating income grew 10% for the quarter, with comparable adjusted operating income up 20%.

For the quarter, the operating margin was 21.0% versus 20.5% in the prior year, while the comparable operating margin (non-GAAP) was 23.1% versus 22.7% in the prior year.

Outlook: For fiscal year 2024, Coke forecasts organic revenue growth of 6%-7% and an increase in comparable EPS of 4%-5%. 

For the first quarter of 2024, Coke anticipates a 4% headwind from currency exchange rates on its comparable revenue. 

The company expects foreign exchange to slow its EPS growth and anticipates an 8% hit from currency changes.

Price Action: KO shares are up 0.72% at $60.13 during the premarket session on the last check Tuesday.

Photo by Mahbod Akhzami on Unsplash