KO
Coca Cola CO
NYSE
8-K: Coca-Cola Posts Strong Q4 and Full-Year 2023 Results, Driven by Global Growth and Strategic Initiatives
Sentiment:
Quarterly and Annual Earnings Release
13 February 2024 6:57 AM
Coca-Cola reported robust financial results for Q4 and full-year 2023, marked by global unit case volume growth, increased net revenues, and strong cash flow performance.
Better than expected
Organic revenue growth exceeded expectations, demonstrating strong underlying business performance.
Global unit case volume growth indicates continued demand for Coca-Cola products despite market challenges.
Summary
- Coca-Cola reported its fourth quarter and full-year 2023 financial results on February 13, 2024.
- Global unit case volume grew 2% for both the quarter and the full year.
- Net revenues increased 7% for the quarter and 6% for the full year.
- Organic revenues (non-GAAP) saw a 12% increase for both periods.
- Operating income grew 10% in Q4 and 4% for the full year.
- Comparable currency neutral operating income (non-GAAP) rose 20% for the quarter and 16% for the year.
- EPS declined 2% to $0.46 for Q4, while comparable EPS (non-GAAP) grew 10% to $0.49.
- Full-year EPS grew 13% to $2.47, and comparable EPS (non-GAAP) increased 8% to $2.69.
- Cash flow from operations reached $11.6 billion for the full year, up 5%.
- Free cash flow (non-GAAP) was $9.7 billion, a 2% year-over-year increase.
- The company gained value share in total nonalcoholic ready-to-drink beverages for both the quarter and the full year.
- Coca-Cola provided a 2024 financial outlook, expecting organic revenue growth of 6% to 7%.
Sentiment
Score: 8
Explanation: The overall sentiment is positive, reflecting strong financial performance and a confident outlook for 2024. While some challenges exist, the company's strategic initiatives and market position suggest a positive trajectory.
Positives
- Strong organic revenue growth of 12% for both the quarter and full year demonstrates robust underlying business performance.
- Global unit case volume growth of 2% indicates continued demand for Coca-Cola products.
- Gaining value share in the total nonalcoholic ready-to-drink beverage market signifies a strengthening competitive position.
- Increased cash flow from operations and free cash flow reflect efficient operations and financial management.
- Successful refranchising of bottling operations in several markets allows the company to focus on brand building and growth.
- Positive employee engagement and recognition as #1 on the 2023 American Opportunity Index highlight a strong company culture.
Negatives
- Reported EPS declined 2% in Q4, although comparable EPS (non-GAAP) showed growth.
- Operating margin decreased for the full year, although comparable operating margin (non-GAAP) expanded slightly.
- Unit case volume declined 1% in North America during Q4.
- Coffee sales declined 7% in Q4, despite full-year growth.
- Tea sales declined 1% for the full year.
Risks
- Unfavorable economic and geopolitical conditions could negatively impact future results.
- Increased competition in the beverage industry could pressure market share and profitability.
- Supply chain disruptions and rising input costs pose a risk to margins.
- The ongoing tax dispute with the IRS could result in significant financial liabilities.
- Changing consumer preferences and health concerns could impact demand for certain products.
- Currency fluctuations and interest rate increases could affect financial performance.
Future Outlook
Coca-Cola expects 6% to 7% organic revenue (non-GAAP) growth in 2024, with comparable EPS (non-GAAP) growth of 4% to 5%. Free cash flow (non-GAAP) is projected to be approximately $9.2 billion.
Management Comments
- During the year, our people and partners rose to meet new challenges, allowing us to excel globally and deliver in a dynamic world,' said James Quincey, Chairman and CEO of The Coca-Cola Company.
- As we begin a new year, we’re confident that our all-weather strategy, powerful portfolio and harmonized system will continue to create value for our stakeholders in 2024 and for the long term.'
Industry Context
The results suggest Coca-Cola is navigating a dynamic global beverage market effectively through strategic pricing, portfolio diversification, and a focus on local consumer engagement. The company's refranchising efforts indicate a continued shift towards an asset-light model.
Legal Proceedings
- The company has an ongoing tax dispute with the IRS.
Key Dates
- February 13, 2024: Date of 8-K filing and press release announcing Q4 and full-year 2023 results.
- December 31, 2023: End of fiscal year 2023.
Keywords
Coca-Cola, Earnings, Q4 2023 Results, Financial Performance, Beverage Industry, Non-GAAP, Organic Revenue, Unit Case Volume, Cash Flow, Refranchising, Market Share
KO
Coca Cola CO
NYSE
Sector: TBD
Filings with Classifications
Worse than expected
26 June 2025 11:33 AM
Current Report
- Operating income decreased by 12% in 2024, indicating a decline in core profitability.
- Net cash provided by operating activities significantly decreased by 41% due to the large IRS tax litigation payment, impacting liquidity.
- The company recorded substantial 'Other Operating Charges' including a $760 million impairment for the BodyArmor trademark and a $3,109 million remeasurement of the fairlife contingent consideration liability, indicating significant one-time or non-recurring negative impacts on profitability.
Delay expected
26 June 2025 11:33 AM
Current Report
- Certain initiatives included in the company's productivity and reinvestment program, primarily designed to further simplify and standardize the organization, have been delayed and will now be completed during 2025.
Worse than expected
1 May 2025 3:38 PM
Quarterly Report
- Net operating revenues decreased by 2% due to foreign currency fluctuations and strategic divestitures.
Delay expected
1 May 2025 3:38 PM
Quarterly Report
- Certain initiatives included in the productivity and reinvestment program, which are primarily designed to further simplify and standardize our organization, have been delayed and will be completed during 2025.
Worse than expected
29 April 2025 6:58 AM
Quarterly Report
- Net revenues declined 2% due to currency headwinds and refranchising, indicating worse performance than expected.
- Free cash flow was negative $5.5 billion due to a large contingent consideration payment, indicating worse performance than expected.
Worse than expected
20 February 2025 3:17 PM
Annual Results
- Operating income decreased by 12% due to higher commodity costs, selling, general and administrative expenses, other operating charges, the impact of refranchising, and unfavorable foreign currency exchange rate impact.
Worse than expected
24 October 2024 11:55 AM
Quarterly Report
- The company's operating income decreased by 23% in Q3 2024 compared to Q3 2023.
- The company's net operating revenues decreased by 1% in Q3 2024 compared to Q3 2023.
- The company recorded a $760 million impairment charge related to the BodyArmor trademark.
Worse than expected
23 October 2024 7:00 AM
Quarterly Report
- The company's net revenue declined by 1%, and operating income decreased by 23%, indicating worse than expected results.
- EPS declined by 7%, which is worse than expected.
- The company's cash flow from operations and free cash flow decreased due to a $6.0 billion payment to the IRS, which is worse than expected.
Capital raise
15 August 2024 4:10 PM
Debt Offering Announcement
- The Coca-Cola Company completed a public offering of 1 billion euros in aggregate principal amount of euro-denominated notes.
- The offering includes 500 million euros of 3.375% notes due in 2037 and 500 million euros of 3.750% notes due in 2053.
Capital raise
14 August 2024 4:14 PM
Debt Offering Announcement
- The Coca-Cola Company completed a public offering of $3 billion in senior notes.
- The offering included $750 million of 4.650% notes due in 2034, $1.5 billion of 5.200% notes due in 2055, and $750 million of 5.400% notes due in 2064.
- The company intends to use the net proceeds for general corporate purposes.
Capital raise
9 August 2024 4:24 PM
Debt Offering Announcement
- Coca-Cola is raising $3 billion through a debt offering.
- The offering is split into a US dollar-denominated offering and a euro-denominated offering.
- The US dollar offering includes $750 million of 4.650% notes due 2034, $1.5 billion of 5.200% notes due 2055, and $750 million of 5.400% notes due 2064.
- The euro offering includes 500 million of 3.375% notes due 2037 and 500 million of 3.750% notes due 2053.
Worse than expected
29 July 2024 3:54 PM
Quarterly Report
- Operating income decreased by 17% for the first six months of 2024, indicating a worse performance compared to the same period last year.
- The company recorded significant other operating charges of $2.943 billion for the first six months of 2024, negatively impacting profitability.
- The potential tax liability of $16 billion due to the ongoing dispute with the IRS is a significant financial risk.
Better than expected
23 July 2024 6:58 AM
Quarterly Report
- The company's organic revenue growth of 15% exceeded expectations.
- The company raised its full-year guidance for organic revenue growth to 9-10% and comparable EPS growth to 5-6%.
Capital raise
14 May 2024 4:08 PM
Debt Offering Announcement
- The Coca-Cola Company completed a public offering of €1 billion in Euro-denominated notes.
- The offering was split into two tranches: €500 million of 3.125% notes due in 2032 and €500 million of 3.500% notes due in 2044.
Capital raise
13 May 2024 4:13 PM
Debt Offering Announcement
- Coca-Cola completed a public offering of $3 billion in aggregate principal amount of U.S. dollar-denominated notes.
- The offering included three tranches with different maturities and interest rates.
- The proceeds will be used for general corporate purposes and potentially for tax litigation payments.
Capital raise
8 May 2024 5:07 PM
Debt Offering Announcement
- The company is raising $3 billion through the issuance of US dollar-denominated notes.
- The company is raising 1 billion through the issuance of Euro-denominated notes.
Worse than expected
2 May 2024 1:52 PM
Quarterly Report
- The company's operating income decreased by 36% due to a $760 million impairment charge related to the BodyArmor trademark and a $765 million charge related to the remeasurement of a contingent consideration liability for fairlife.
Worse than expected
30 April 2024 6:58 AM
Quarterly Report
- The company's reported operating income declined by 36%, significantly worse than expected due to substantial charges related to the fairlife acquisition and the BODYARMOR trademark impairment.
Better than expected
13 February 2024 6:57 AM
Quarterly and Annual Earnings Release
- Organic revenue growth exceeded expectations, demonstrating strong underlying business performance.
- Global unit case volume growth indicates continued demand for Coca-Cola products despite market challenges.
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