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Coca-Cola results hit by halt to pro sports, live events
[NEW YORK] Coca-Cola reported a steep drop in second-quarter profits Tuesday due to a big decline in away-from-home consumption, especially at the height of the coronavirus lockdowns.
The results underscored the soda maker's reliance for sales on sporting events, movie theatres and entertainment - economic segments that have been battered by social distancing protocols instituted to address Covid-19.
Net income came in at US$1.8 billion, down 32 per cent, behind a 28 per cent decline in sales to US$7.2 billion.
Coca-Cola expects the second quarter to be "the most severely impacted" period of 2020, "the ultimate impact on full year 2020 results is unknown," the company said.
Like many other large companies, Coca-Cola withdrew its annual forecast this spring amid the upheaval of the Covid-19 shutdowns.
The company did not restore a projection in its second-quarter earnings statement, a sign of continued uncertainty as large markets including the United States continue to battle outbreaks.
Volumes bottomed out in April with a decline of 25 per cent, but improved gradually to a drop of 10 per cent in June as lockdowns eased, the company said.
"Performance has been driven by improving trends in away-from-home channels, along with sustained, elevated sales in at-home channels," Coca-Cola said.