Coca-Cola ($KO) has recently elevated its full-year financial outlook after reporting fiscal second-quarter earnings that significantly surpassed expectations. The beverage behemoth attributes this positive outcome to both volume growth and effective pricing strategies. The company's revised forecast now anticipates an adjusted earnings per share (EPS) increase of 5% to 6% for the fiscal year 2024, revising its prior estimate of 4% to 5% growth.
When accounted for currency fluctuations, the projected comparable EPS growth is now set at 13% to 15%, an increase from earlier projections that estimated an 11% to 13% rise. Analysts surveyed by Capital IQ have a consensus expectation for normalized EPS of $2.84 this fiscal year. Coca-Cola also expects organic revenue to grow between 9% and 10% for fiscal 2024, a notable rise from its previous guidance of 8% to 9%.
Market analysts anticipate that revenue will hit $45.73 billion. Chief Executive James Quincey expressed optimism about the company’s second-quarter results, emphasizing the solid top-line and operating income growth amidst a continuously evolving market landscape. Quincey stated, "We are encouraged with our second-quarter results, which delivered solid topline and operating income growth in an ever-changing landscape.
We continue to execute our highly effective all-weather strategy, and we are confident in our ability to deliver on our raised 2024 guidance and longer-term objectives." During the last quarter, Coca-Cola reported adjusted earnings of $0.84 per share, which is an improvement from $0.78 in the previous year, and it also exceeded the market’s forecast of $0.81.
Non-GAAP revenue for the quarter rose to $12.31 billion, surpassing last year's $11.97 billion and analysts’ expectations of $11.75 billion. The company indicated that it experienced a 9% increase in consolidated pricing and product mix, with approximately five percentage points attributable to pricing adjustments in markets facing "intense inflation." Additionally, concentrate sales, which include the overall quantity of concentrates, syrups, beverage bases, source waters, and powders sold by the company, grew by 6%. Coca-Cola's consolidated unit case volume saw a 2% increase in the quarter, primarily supported by growth in developing and emerging markets.
Notably, volumes in North America declined by 1%, while growth in Europe, the Middle East, and Africa remained flat. Conversely, Asia Pacific volumes surged by 3%, and Latin America experienced a growth of 5%. The company reported flat volumes in its water, sports, coffee, and tea division, but recorded positive gains in its sparkling soft drinks and juice segments, as well as value-added dairy and plant-based beverages. Looking ahead to the current three-month period, Coca-Cola anticipates facing currency headwinds of approximately 8% for comparable EPS and 4% for revenue, respectively.
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