Coca-Cola, collateral victim of the quarantines

22-07-2020 by Mirai

With many restaurants, bars and cinemas closed, Coca-Cola has seen its sales collapse at the height of containment measures imposed in the face of the pandemic, but the US soft drink giant is cautiously optimistic for the rest of the year.

Sales of the Fanta, Sprite, Minute-Maid and Powerade distributor fell 28% to $ 7.15 billion in the second quarter, according to a statement released Tuesday.

However, the situation gradually improved during the spring for the company, whose out-of-home sales account for about half of turnover. The number of bottles and cans distributed decreased 25% in April compared to the previous month, but only 10% in June and around 5% in July.

"The improvement in the trend of sales outside the home", that is, in catering establishments, service stations, vending machines in offices and public places or at sporting events, "is closely related to the relaxation of quarantine measures Coca-Cola observes. "This correlation should continue in the second half of the year," says the group.

But "given the current uncertainties surrounding the coronavirus pandemic and the intensity of containment, its consequences for all of 2020 remain unknown," adds the company, which has stopped publishing forecasts.

In volume in the second quarter, soft drink sales fell 12%, the flagship Coca-Cola managed to limit the damage (-7%). Sales of juices, dairy products, and plant-based beverages fell 20%, while sales of water and sports drinks fell 24%. Sales of tea and coffee, meanwhile, fell 31%, mainly due to the temporary closure of Costa stores in Western Europe.

Meanwhile, the company's net profit fell 32% to $ 1.78 billion. Reported per share and excluding exceptional items, the benchmark on Wall Street, earnings stood at 42 cents, which is slightly higher than the 40 cents analysts expected.