Coca-Cola Co`s profit, in its first quarter under new Chief Executive James Quincey, beat analysts` estimates on higher demand for its healthier non-carbonated beverages as well as low and no-sugar versions of its sodas.
Coca-Cola, like rival PepsiCo Inc, has been building its non-carbonated drinks portfolio and stepping up efforts to reduce sugar in its beverages as consumers look for healthier options.
"Organic revenue growth in sparkling soft drinks was led by innovation in and marketing support for our low- and no-sugar options like Coca-Cola Zero Sugar," Quincey said in a statement.
Global volume sales of low and no-calorie soda drinks rose in the mid-single digits in the second quarter ended June 30, the company said on Wednesday.
The world`s largest beverages maker said it plans to introduce Coke Zero Sugar in the United States in August.
Coca-Cola said demand rose for its non-aerated drinks such as innocent juice and smoothies in Europe.
The company is delivering on its strategic priorities - growing soda sales by reducing sugar content, broadening beverage portfolio and using higher prices as a driver of profit, Susquehanna analyst Pablo Zuanic wrote in a note.
The change in strategy is paying off for PepsiCo as well. Growing demand for higher-margin healthier foods such as baked chips and smaller soda servings helped its profit beat analysts` estimate this month.
Net income attributable to Coca-Cola`s shareholders fell to $1.37 billion, or 32 cents per share, in the second quarter ended June 30, from $3.45 billion, or 79 cents per share, a year earlier.
Coca-Cola incurred a charge of $653 million related to refranchising its North America bottling operations, as the company continues to sell most of its low-margin bottling business to cut costs.
Excluding items, Coca-Cola earned 59 cents per share, beating the average analysts` estimate of 57 cents, according to Thomson Reuters I/B/E/S.
Revenue fell 16 percent to $9.70 billion, hurt by the refranchising of bottling territories and a strong dollar.
However, revenue beat the average analysts` estimate of $9.65 billion.
The company also forecast adjusted 2017 profit to be flat or down 2 percent, compared with its previous forecast of a 1-3 percent decline, citing lower impact from currency exchange rates.
Coca-Cola`s shares were marginally up in premarket trading on Monday.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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