By Giwa SHILE
Coca-Cola Co forecast full-year profit well below Wall Street expectations on Thursday as it reported a quarterly decline in volumes in North America, sending its shares down three per cent.
Food packaging companies are facing the brunt of rising freight and commodity costs and a dearth of truck drivers leading to squeezed margins and higher costs.
To counter these costs, Coke raised prices of its beverages, but that came at the expense of falling demand.
Volumes, a key indicator of demand, fell by one per cent in North America.
The company forecast full-year profit to be between 2.06 dollars and 2.10 dollars per share far below the average expectation of 2.23 dollars, blaming a stronger dollar.
Net income attributable to the company’s shareholders was 870 million dollars or 20 cents per share in the fourth quarter ended Dec. 31, compared a loss of 2.75 billion dollars or 65 cents per share, a year earlier, when the company took a tax-related charge.
Revenue fell six per cent to 7.1 billion dollars in the fourth quarter, hurt by the refranchising of its low-margin bottling operations.
Analysts had estimated sales of 7.03 billion dollars, according to IBES data from Refinitiv—–Reuters
