Coca-Cola global net revenues up 16% to $10.5 bn in Q1 2022

“We are pleased with our first quarter results as our company continues to execute effectively in a highly dynamic and uncertain operating environment,” said James Quincey, Chairman and CEO of The Coca-Cola Company, as the beverage giant announced its Q1 2022 results, showing continued momentum in its marketplace performance. He further said, “We are confident in our full-year guidance, and we are well-equipped to win in all types of environments as we fuel strong topline momentum and create value for our stakeholders.”

Overall Highlights Quarterly Performance:

Revenues: Net revenues grew 16% to $10.5 billion, and organic revenues (non-GAAP) grew 18%. Revenue performance included 7% growth in price/mix and 11% growth in concentrate sales. Concentrate sales were 3 points ahead of unit case volume, largely due to the timing of concentrate shipments in the current quarter, partially offset by the impact of one less day in the quarter.
Margin: Operating margin, which included items impacting comparability, was 32.5% versus 30.2% in the prior year, while comparable operating margin (non-GAAP) was 31.4% versus 31.0% in the prior year. Operating margin expansion was primarily driven by strong topline growth, partially offset by an increase in marketing investments versus the prior year, the impact of the BODYARMOR acquisition and currency headwinds.
Earnings per share: EPS grew 23% to $0.64, and comparable EPS (non-GAAP) grew 16% to $0.64. Comparable EPS (non-GAAP) performance included the impact of an 8-point currency headwind.
Market share: The company gained value share in total non-alcoholic ready-to-drink (NARTD) beverages, which included share gains in both at-home and away-from-home channels.
Cash flow: Cash flow from operations was approximately $620 million, a decline of $1.0 billion versus the prior year, as strong business performance was more than offset by the impact of cycling the timing of working capital benefits in the prior year and higher 2021 annual incentives in the current year. Free cash flow (non-GAAP) was approximately $400 million, a decline of $1.0 billion versus the prior year.

India Specific Pointers:

Building a competitive edge through excellence in revenue growth management (RGM):

The company, in close alignment with its bottling partners, continues to raise the bar in integrated execution to deliver value to its customers and consumers in an inflationary environment. Accelerated cost pressures and ongoing supply challenges continue across markets, and the company is leveraging RGM to provide compelling customer and consumer solutions by segmenting markets based on occasion, brand, price, package and channel. For example, in India, the company is increasing its consumer base by expanding affordable offerings at key transaction-driving price points through the use of single-serve packages. In the first quarter, this strategy yielded strong results with more than 500 million incremental transactions added in India, up nearly 20% versus the prior year. Approximately 70% of these incremental transactions were driven by small packages such as returnable glass bottles and affordable, single-serve PET packages.

Partnering to make a difference and create shared value:

The company continues to focus on issues that have a measurable, positive impact on communities as well as create opportunities for business growth. Actions such as these help drive packaging circularity and support the company’s World Without Waste initiatives, including recyclability, virgin plastic reduction, reusable packaging and the company’s goal to collect and recycle a bottle or can for everyone it sells by 2030.

Bottling Investments:

Unit case volume grew 8%, driven by strong growth in the key markets of India and the Philippines.

Nutrition, juice, dairy and plant-based beverages grew 12%, led by Fairlife in the United States, Minute Maid Pulpy in China and Maaza in India.

Unit case volume grew 4%, driven by India and the Philippines, partially offset by pressure in China due to reduced consumer mobility resulting from resurgence in COVID-19 cases. Growth was led by Trademark Coca-Cola and sparkling flavours.