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Coca-Cola the world’s largest soft drink company reported a fourth quarter profits that was better than Wall Street estimates helped from the company’s efforts to cut costs and its move toward drinks that had higher prices.
Excluding special items, Coca-Cola’s profit reached 44 cents per share during the three months from October through the end of December. Wall Street analysts were expecting the soft-drink behemoth to have earnings of 42 cent per share.
While overall revenue dropped by 1.5% to $10.92 billion, it exceeded analyst estimates on Wall Street that averaged $10.81 billion.
The soft drink maker’s CEO Muhtar Kent has had to cope with multiple challenges including sluggish growth globally and currency fluctuations. The company is cutting its expenses as well as selling more beverages that are higher priced.
The Coca-Cola CEO wants to cut $3 million in costs annually and is confronting growing concerns over the use of artificial sweeteners as well as problems of obesity.
The soft drinks company has been remained steadfast with its pricing strategy. That in turn helped to drive growth at its top line in its domestic market, said an analyst with California based Wells Fargo.
Coca-Cola stock was up in trading on Tuesday following the soft drink maker’s release of the quarterly financials. Shares thus far in 2017 had dropped 2.2% prior to Tuesday.
Volume globally was up just 1% during the last quarter of 2014. Excluding the effect on currency fluctuations, revenue would have risen by 4% during the fourth quarter of 2014.
Like a number of businesses based in the U.S. that have a global footprint, The Coke maker saw a strong U.S. dollar eat away at overseas sales.
It is expected that currency will squeeze revenue as much as 5 percentage points as well as profit by up to 8 percentage points.
Latin America was Coca-Cola’s biggest growth area without taking into consideration the currency impact. That region had a 14% increase for the quarter. North America along with Africa-Eurasia increased 5% and Asia-Pacific declined by 1%.
