Coca-Cola Earnings Meet Expectations (KO)

Coca-Cola KO reported earnings today. The company missed analysts' EPS estimates by only $0.01 and reported in-line revenues for the first quarter.

Coca-Cola attributes the $0.01 miss to the tragedies of Japan and the understandably reduced demand in the country as they repaired from the earthquake and nuclear disaster.

Worldwide volume grew a strong 6% in the quarter, with growth in all five geographic operating groups. Excluding new cross-licensed brands, primarily Dr Pepper brands, worldwide volume growth was 5% in the quarter. International volume growth was 6%.

North America volume growth was 6% in the quarter. Excluding new cross-licensed brands, North America volume growth was 2% in the quarter, marking the fourth consecutive quarter of organic growth for our flagship market.

The CEO commented, “This year on May 8 we celebrate the 125th anniversary of one of the world's greatest consumer product innovations—Coca-Cola. As we mark this milestone, we see a company and a system shaped by its youth and not its age.

“And as we look forward, the opportunities before us are clearly abundant. We see one unified system, guided by 700,000 of the world's greatest people and aligned behind one compelling and achievable 2020 Vision. Collectively, we own, inspire and drive our 2020 Vision each and every day. Our strong alignment has not only helped us weather recent storms, it has put us in a position of real strength. That is why, as we look ahead to 2020 and beyond, I am confident that our system has only just begun to achieve its potential in ushering in a new era of winning for all of our shareowners.”

Worldwide volume growth was led by brand Coca-Cola, up 3% in the quarter. Global volume and value share gains continued in total nonalcoholic ready-to-drink (NARTD) beverages and across both sparkling and still beverages.

First quarter reported EPS was $0.82, up 19%, with comparable EPS at $0.86, up 7% and in line with our long-term target. Comparable EPS includes a $0.01 dilutive effect, which will reverse primarily in the fourth quarter, due to the timing of marketing expenses as we conform the newly acquired North American bottling business to our accounting policies. We also estimate the events in Japan had a $0.01 dilutive effect on first quarter comparable EPS as a result of lost revenues.

First quarter reported net revenue was $10.5 billion, up 40%, with comparable net revenue also up 40%, reflecting solid growth in concentrate sales, a 2% currency benefit, positive price/mix and the acquisition of Coca-Cola Enterprises' (CCE) North American operations.

First quarter reported operating income was $2.3 billion, up 4%, with comparable operating income up 10%, reflecting strong top-line performance, a 3% currency benefit and the acquisition of CCE's North American operations.

REMINDER: Coca-Cola is posting a conference call with investors and analysts to discuss our first quarter 2011 results today at 9:30 a.m. EDT.