The Coca-Cola Company today reported strong third quarter 2022 results as the
company continued to build on the momentum from the first half of the year. “Our strong capabilities
and consumer insights continue to help us win in the marketplace,” said James Quincey, Chairman and
CEO of The Coca-Cola Company. “Our business is resilient amidst a dynamic operating and
macroeconomic environment. We are investing in our strong portfolio of brands, which is a cornerstone
of our ability to deliver long-term value for our stakeholders.”
Overall Highlights Quarterly Performance:
Revenues – Net revenues grew 10% to $11.1 billion, and organic revenues (non-GAAP) grew
16%. Organic revenue (non-GAAP) performance was strong across operating segments and
included 12% growth in price/mix and 4% growth in concentrate sales.
Margin – Operating margin, which included items impacting comparability, was 27.9% versus
28.9% in the prior year, while comparable operating margin (non-GAAP) was 29.5% versus
30.0% in the prior year. Comparable operating margin (non-GAAP) compressed as strong topline
growth was more than offset by the impact of the BODYARMOR acquisition, higher operating
costs, an increase in marketing investments versus the prior year, and currency headwinds.
Earnings per share – EPS grew 14% to $0.65, and comparable EPS (non-GAAP) grew 7% to $0.69.
Comparable EPS (non-GAAP) performance included the impact of an 11-point currency
headwind.
Market share – The company gained value share in total nonalcoholic ready-to-drink (NARTD)
beverages.
Cash flow – Cash flow from operations was $8.1 billion year-to-date, a decline of $1.2 billion
versus the prior year, as strong business performance was more than offset by the impact of
cycling the timing of working capital benefits in the prior year and higher 2021 annual incentives
in the current year. Free cash flow (non-GAAP) was $7.3 billion, a decline of $1.2 billion versus
the prior year.
India Specific Pointers:
We drove 2.5 billion transactions in India at affordable price points through the expansion of
returnable glass bottles and single-serve PET packages.
Sprite has grown to become a billion-dollar brand in the market, driven by the success of
locally adapted, occasion-based global marketing campaigns and screentime.
Category-led performance:
o In India, we continue to strengthen the first half of the year as we gain share in
sparklings offerings. Trademark Coke delivered strong growth through effective
execution and occasion-based marketing.
o Sparkling soft drinks grew 3%, driven by growth across all geographic operating
segments, primarily led by India, Mexico and China. Trademark Coca-Cola grew 3%,
driven by growth across all geographic operating segments. Coca-Cola® Zero Sugar grew
11%, driven by low double-digit growth across developed markets and high single-digit
growth across developing and emerging markets. Sparkling flavors grew 3%, led by Asia
Pacific and Latin America.
o Nutrition, juice, dairy and plant-based beverages were even, as growth led by Minute
Maid Pulpy in China, Maaza® in India and fairlife® in the United States was offset by
declines primarily in local brands in Eastern Europe.
Asia Pacific: Unit case volume grew 9%, driven by strong growth in India and China. Growth was
led by sparkling soft drinks and hydration.
Company Updates:
Leveraging strong revenue growth management capabilities to meet consumer needs – In an
environment where consumer preferences are rapidly evolving, the company is focused on
expanding its offerings to fit all consumers’ budgets. The Coca-Cola Value Bundle, which was
launched in North America during the third quarter, is an example of how the company is
offering more choices to cost-conscious consumers. The bundle features an assortment of core
sparkling brands at relevant and competitive price points. By utilizing end-to-end messaging
across platforms, these offerings are retaining and recruiting more consumers while creating
value for our customers. Additionally, the company is balancing the mix between affordability
and premiumization, while driving pricing actions in the marketplace in response to ongoing cost
inflation.
Turning insights into global brand experiences – The company continues to engage and attract
consumers through globally scaled marketing campaigns driven by consumer insights. The
“What the Fanta” marketing and innovation platform is an example of how the company is
executing with its global networked marketing partner to identify and scale what resonates with
consumers, from taste to brand experiences. Now launched in over 30 markets globally, the
experience-driven platform is designed to spark adventure and intrigue through bold innovative
flavors complemented by social media campaigns and multi-channel activations.
Strategically expanding in emerging categories – Since entering into the ready-to-drink (RTD)
alcohol beverages category in 2018 with Lemon-Dou in Japan, the company has continued its
test-and-learn approach with disciplined experiments around alcohol occasions globally. The
company is leveraging brands with strong credentials, such as Topo Chico®, while adding to the
existing portfolio of Schweppes® premium adult cocktail mixers and tonics. This year, Simply
Spiked LemonadeTM and FrescaTM Mixed were introduced in the United States through brand
authorization agreements with Molson Coors Beverage Company and Constellation Brands, Inc.,
respectively, and both offerings are seeing encouraging early results.
Increasing water security through collaboration and collective action – The company continues
to focus on collaborating with businesses and nongovernmental organizations to create a more
sustainable and better-shared future. During the quarter, at World Water Week 2022, the
company focused on how corporate water stewardship can drive collective action to help
address water challenges. Over the past two years, the company has stepped up investments in
nature-based water solutions as an important part of its 2030 Water Security Strategy.
