By Jennifer Maloney
Coca-Cola Co. said it expects to see growth this year in China, even as its global sales continue to decline because of the closures of restaurants, bars, movie theaters and sports stadiums elsewhere around the world.
In China, where the coronavirus originated, consumers are "more or less back to where they were" before the pandemic started, though away-from-home sales aren't quite back to where they were, Coke's finance chief, John Murphy, said in an interview.
China, South Korea, Hong Kong, Singapore, Australia and New Zealand "are all in a bucket that have demonstrated that taking a very disciplined set of measures and applying them consistently has allowed them to emerge faster." In the U.S., which has the highest number of confirmed coronavirus infections and deaths in the world, people are "pushing the boundaries a bit more in terms of trying to live a more normal life," Mr. Murphy said.
The company reported improved sales at U.S. convenience stores and quick-service restaurants in the third quarter. "The consumer, I think, has been trying to adapt to a new normal," Mr. Murphy said.
Coca-Cola reported revenue of $8.65 billion in the quarter, a decline of 9% from a year earlier but an improvement over the second quarter, when its revenue fell by 28%.
The company has said it thinks the biggest challenges of the pandemic are behind it. About half of Coca-Cola's business comes from away-from-home venues that were largely closed around the world during the second quarter.
"It's important to remember the world is in a fragile state," Coke Chief Executive James Quincey said on a call with analysts Thursday, noting the new restrictions recently announced in several countries. More lockdowns could come as winter approaches in the Northern Hemisphere, he said. "We are prepared for setbacks."
Coca-Cola said Thursday that it plans to cut its 430 "master brands" by about half, to 200, accelerating a culling effort in response to the coronavirus pandemic. Among the brands on the chopping block are Tab cola and Zico coconut water, The Wall Street Journal has reported. The plan is part of a restructuring that includes layoffs and a revamped marketing strategy.
The company's global sales volume declined 4% in the third quarter. They also fell 4% in Asia, primarily because of coronavirus-related restrictions in India and Japan. That was partially offset by growth in carbonated soft drinks in China, the company said.
The beverage company said profit for the third quarter was $1.74 billion, or 40 cents a share. A year earlier, net income was $2.59 billion, or 61 cents a share. The company logged adjusted earnings of 55 cents a share in the latest quarter.
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(END) Dow Jones Newswires