Coca-Cola Q4 Profit Matches Estimates; Sees 2020 Profit Below View

(RTTNews) - Coca-Cola Co.(KO) Thursday reported a surge in fourth-quarter net profit from last year. Quarterly net revenues grew 16 percent, driven by concentrate sales growth and price/mix growth. Organic revenues grew 7 percent for the quarter.

For fiscal year 2020, the company projects comparable earnings per share to be about $2.25 compared $2.11 in 2019. Analysts expect annual earnings of $2.26 per share.

For full year 2020, the company expects to deliver about 5% growth in organic revenues and approximately 8% growth in comparable currency neutral operating income.

For annual comparable net revenues, the company expects a slight tailwind from acquisitions, divestitures and structural items and a 0% to 1% currency headwind based on the current rates and including the impact of hedged positions.

Looking ahead for the first-quarter 2020, the company expects comparable operating income to include a 5% currency headwind based on the current rates and including the impact of hedged positions.

Comparable net revenues for the first-quarter are expected to include a 0% to 1% tailwind from acquisitions, divestitures and structural items in addition to a 2% currency headwind based on the current rates and including the impact of hedged positions.

Coca-Cola reported that its net income attributable to shareowners of the company for the fourth-quarter surged to $2.04 billion or $0.47 per share from $870 million or $0.20 per share in the previous year.

The company recorded other-than-temporary impairment charges of $334 million in the prior year quarter, related to certain equity method investees in the Middle East. The impairment charges were primarily driven by revised projections of future operating results largely due to instability in the region, which include sanctions imposed locally. Comparable net income for the fourth-quarter was $1.91 billion or $0.44 per share compared to $1.88 billion or $0.44 per share last year. Analysts polled by Thomson Reuters expected the company to report earnings of $0.44 per share for the fourth-quarter. Analysts' estimates typically exclude special items.

Operating income grew 19 percent in the latest-quarter, which included items impacting comparability and a benefit from acquisitions, partially offset by currency headwinds.

Comparable currency neutral operating income grew 23 percent in the quarter, driven by solid organic revenue growth, a benefit from productivity initiatives and a benefit from acquisitions.

Net revenues for the fourth-quarter grew 16 percent to $9.07 billion from $7.81 billion in the prior year. Organic revenues grew 7 percent for the quarter. Analysts expected revenues of $8.89 billion for the fourth-quarter.

Revenue growth for the quarter was driven by concentrate sales growth of 2 percent and price/mix growth of 5%. The quarter included one additional day, which resulted in an approximate 1-point benefit to revenue growth.

Unit case volume grew 3 percent for the quarter, led by broad-based growth in developing and emerging markets, along with positive performance in developed markets.

In the pre-market trade, KO is trading at $57.70 up $0.66 or 1.16 percent.