- Sunday, February 18, 2018 3:19 PM
Atlanta, 18 February 2018 (MIA) - US President Donald Trump's tax overhaul dealt a temporary blow to Coca-Cola, but the beverage giant will benefit from the changes in the long run, local media reported.
Meanwhile, Coca-Cola reported solid revenue growth of 6% for its core products. That included increases in sales of water, tea and coffee drinks.
Soda sales were flat for the quarter, which ended right before the company introduced new packaging and flavor types of Diet Coke in a bid to boost interest in the flagging brand.
Sales of juice, dairy and plant beverages suffered a 2% decline for the period, compared with a year earlier, as the Hi-C brand declined sharply.
Customers have been moving away from sugary beverages and artificial sweeteners in favor of products perceived as more natural or healthy.
New products such as Smartwater, ZICO coconut water and Appletiser gave the company a lift. Water, enhanced water and sports drinks increased 2%, while tea and coffee rose 2%.
In North America, tea and coffee performed especially well, rising 8%.
Overall, Coca-Cola swung from net income of $550 million in 2016's fourth quarter to a net loss of $2.75 billion in 2017's fourth quarter.
That was mostly attributable to a one-time charge of $3.6 billion blamed on the new federal tax law, which forced the company to pay taxes on certain past offshore earnings.
But the company will win in the long run — and indeed said it supported the changes — as its effective tax rate is expected to decline to 21% in 2018. The company had previously estimated it would be 26% for the year.
"I am pleased with our accomplishments and results in 2017," Coca-Cola CEO James Quincey said in a statement. "We achieved or exceeded our full-year guidance while driving significant change as we continued to transform into a total beverage company. While there is still much work to do, I am encouraged by our momentum as we head into 2018."
Coca-Cola stock rose 2% in pre-market trading to $45.69. lk/15:18
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