Summary
The Coca-Cola Company's (KO) Q2 2011 filing shows a significant increase in net operating revenues, driven by the consolidation of Coca-Cola Enterprises Inc.'s (CCE) North American business and favorable foreign currency movements. While revenue growth was strong, the gross profit margin experienced a decline due to the acquisition of CCE and increased commodity costs. The company also reported substantial charges related to integration and restructuring initiatives, as well as the impact of the natural disasters in Japan. Despite these pressures, KO demonstrated resilience with solid volume growth across most operating segments, particularly in emerging markets. The company's liquidity remains strong, supported by robust operating cash flows and an extensive credit facility. Management highlighted strategic initiatives aimed at long-term growth and operational efficiency, including ongoing productivity programs and the integration of acquired businesses.
Financial Highlights
55 data points| Revenue | $12.25B |
| Cost of Revenue | $4.88B |
| Gross Profit | $7.37B |
| SG&A Expenses | $4.52B |
| Operating Income | $2.75B |
| Interest Expense | $116.00M |
| Net Income | $2.22B |
| EPS (Basic) | $0.49 |
| EPS (Diluted) | $0.48 |
| Shares Outstanding (Basic) | 4.57B |
| Shares Outstanding (Diluted) | 4.65B |
Key Highlights
- 1Net operating revenues increased by 47% to $12.7 billion for the three months ended July 1, 2011, compared to the prior year, largely due to the acquisition of CCE's North American business.
- 2Consolidated net income attributable to shareowners rose to $2.797 billion ($1.20 per diluted share) for the three months ended July 1, 2011, from $2.369 billion ($1.02 per diluted share) in the prior year.
- 3Gross profit margin decreased to 60.8% from 65.9% for the three months ended July 1, 2011, compared to the prior year, primarily due to the impact of the CCE acquisition and rising commodity costs.
- 4The company incurred significant "other operating charges" of $152 million for the three months ended July 1, 2011, primarily related to productivity, integration, and restructuring initiatives, and $52 million related to the earthquake and tsunami in Japan.
- 5Unit case volume increased by 6% globally for the three months ended July 1, 2011, with strong performance in Eurasia & Africa (7%) and the Pacific region (7%).
- 6Cash and cash equivalents increased by $1.6 billion to $10.2 billion as of July 1, 2011, compared to December 31, 2010, indicating a strong liquidity position.
- 7Long-term debt decreased by $2.7 billion to $11.4 billion as of July 1, 2011, from $14.0 billion as of December 31, 2010, partly due to debt repurchases.