Home ›› 27 Jul 2022 ›› World Biz
Coca-Cola Co (KO.N) lifted its full-year revenue forecast on Tuesday, as demand for sugary sodas held up strong despite price increases to blunt the impact of higher costs for key inputs such as corn syrup and aluminum cans.
The blue-chip stock, which has gained 5per cent this year, rose about 1per cent in premarket trading.
Packaged food makers have so far felt little impact of decades-high inflation, especially in the United States, as people prioritize spending on eating at home rather than at restaurants.
Rival PepsiCo Inc (PEP.O) said last week it had not seen any slowdown in demand and added that there was room for prices to go further up.
Coca-Cola said global sales volumes rose 8per cent in the second quarter, powered by growth in both developed and emerging markets, while average selling prices rose about 12per cent.
Net revenue rose 12per cent to $11.3 billion in the quarter ended July 1. Analysts on average had expected revenue of $10.55 billion, according to Refinitiv IBES data.
However, Coca-Cola's comparable operating margin fell to 30.7per cent from 31.7per cent, squeezed by surging commodity and transportation costs.
The company forecast organic revenue to rise 12per cent to 13per cent in 2022, compared to prior expectation of 7per cent to 8per cent increase.
It expects full-year adjusted earnings per share, excluding the impact of a stronger dollar, to rise 14per cent to 15per cent, compared to prior estimates of 8per cent to 10per cent growth.
The company now sees a stronger dollar to be a 6per cent headwind to its revenue, compared to previous forecast of 2per cent
