Still, “our work isn’t done,” Chairman and Chief Executive Officer James Quincey told analysts after the company reported 2020 financial results.
He said he expects further revenue and earnings per share improvements as vaccine distribution becomes widespread this year — crucial for a company that sells much of its namesake soda and other globe-circling drink brands in restaurants and at big public gatherings like movie theaters, concerts and sporting events.
Global case volume of drinks sold — a crucial measure for Coke’s portfolio of soft drinks, bottled water, juices and sports drinks — was down 6% last year and 3% in the final quarter. It marked only the second annual volume decline for the company in at least three decades. And it was the steepest since 1946, when there was a 12% fall off.
Trademark Coke brands were down 1% for the year, even with growth in Coca-Cola Zero Sugar.
About half of the company’s overall sales now are tied to public venues.
Net revenue in 2020 was $33 billion, down 11% from the year earlier. Annual net income skidded to $7.7 billion, a 13% fall. In the final three months of last year, revenues were down 5% and net income sank 29%.
Last year, Coke announced it was cutting 2,200 employees around the globe, including 500 in metro Atlanta, or nearly 10% of its local workforce. Some of the reductions were tied to employees who took voluntary separation packages.
In October, Coke announced it was dropping half its drink brands, most of them sold outside the United States. They accounted for only about 1% of the company’s profits. Among those being ditched: Tab, the company’s original diet soft drink.
What it means:
Coca-Cola’s steepest annual decline in drink volume in more than half a century highlights how the pandemic has rearranged the financial prospects of many Georgia companies. Some local employers, such as Delta Air Lines, have been battered as travel plummeted. Others, including delivery giant UPS, saw profits soar with the rise of e-commerce.