Coca-Cola profit beats estimates; North American soda sales up
By Anjali Athavaley and Devika Krishna Kumar
(Reuters) - Coca-Cola Co (KO.N: Quote) reported a slightly higher-than-expected profit on Tuesday as sales in North America, its biggest market, rose for the first time in four quarters, offsetting the impact of a stronger dollar on its overseas business.
Shares of the world's largest beverage maker rose 3.2 percent to $42.56 in premarket trading.
Coke's sales in North America have declined or remained flat for the last three quarters as U.S. consumers opt for healthier beverages and shift away from diet sodas due to concerns about artificial sweeteners.
North American sales rose 2 percent to $5.37 billion in the fourth quarter, accounting for about half of total sales.
Analysts say U.S. consumers are still drinking less soda but are paying more for it. Coke's prices in North America rose 4 percent overall in the quarter.
Low gasoline prices and a brighter job market have encouraged many consumers to dig a little deeper into their pockets. U.S. consumer confidence is at its highest in more than seven years, according to a report released in January.
In a research note, Stifel Nicolaus analyst Mark Swartzberg called the fourth quarter a "silver lining quarter," saying efforts to improve growth should eventually bear fruit.
Coke said in October that it was targeting $3 billion in cost savings by 2019. It also announced a timeline for selling its lower-margin bottling operations. Continued...