Coca-Cola Q4 Revenue Beats Expectations, Helped by Higher Prices
Coca-Cola (NYSE:KO), one of the most widely recognized consumer staples companies in the world, reported its fourth-quarter results for fiscal year 2023 on Tuesday, February 13, 2024. The company posted quarterly earnings that met expectations and sales that topped estimates, as higher prices helped the beverage maker overcome a volume decline in North America. Here are some of the key highlights from the earnings report.
Revenue: $10.85 billion vs analyst estimates of $10.65 billion (1.9% beat)
Coca-Cola's revenue grew 6.4% year on year to $10.85 billion, beating analyst estimates of $10.65 billion by 1.9%. The revenue growth was driven by higher prices, as well as increased sales volumes in some regions. The company's organic revenue, which excludes the impact of currency fluctuations and acquisitions, was up 12% year on year.
The company reported strong growth in its Europe, Middle East and Africa segment, where revenue increased 25% year on year to $2.5 billion. Latin America also saw a 23% increase in revenue to $1.1 billion, while Asia Pacific grew 13% to $1.7 billion. North America, however, experienced a slight decline in revenue of 1% to $5.3 billion, as lower sales volumes offset the benefit of higher prices.
EPS (non-GAAP): $0.49 vs analyst estimates of $0.49 (small beat)
Coca-Cola's earnings per share (EPS) came in at $0.49 on a non-GAAP basis, matching analyst estimates of $0.49. The EPS was up 8.9% from the same quarter last year, when it was $0.45. The EPS growth was mainly due to higher operating income and lower interest expense, partially offset by higher taxes and lower equity income.
The company's GAAP EPS was $0.46, down 2.1% from the same quarter last year, when it was $0.47. The GAAP EPS included a net charge of $0.03 per share related to restructuring costs and other items.
Guidance for 2024: In line with expectations
Coca-Cola provided its outlook for fiscal year 2024, which was in line with analyst expectations. The company expects to grow its organic revenue by 6%-7% and its adjusted EPS by 4%-5%. The company also expects to generate free cash flow of about $9 billion and return about $8 billion to shareholders through dividends and share repurchases.
The company noted that it faces some headwinds in the first quarter of 2024, such as unfavorable currency impact of about 4%, higher commodity costs and supply chain challenges.
Conclusion
Coca-Cola delivered a solid performance in the fourth quarter of fiscal year 2023, beating revenue estimates and meeting earnings expectations. The company demonstrated its pricing power and resilience in a challenging environment, while also investing in innovation and growth initiatives. The company's guidance for fiscal year 2024 was also encouraging, indicating confidence in its long-term strategy and outlook.