Coca-Cola's profit up even as sales disappoint

Associated Press Modified: October 16, 2012 at 4:45 pm •  Published: October 16, 2012

NEW YORK (AP) — The Coca-Cola Co. has a formula for growth in the volatile economic climate: sell more of its drinks in emerging markets and evolve its stable of products at home, where concerns over sugary drinks are intensifying.

The world's biggest beverage maker, which makes Sprite, Fanta, Minute Maid and Dasani water, said the strategy helped lift its global sales volume by 4 percent in the third quarter. But the Atlanta-based company was hit by unfavorable currency exchange rates, as well as pressures to keep prices in check in economically hard-hit regions in Asia and Europe.

Total revenue rose just 1 percent as a result, which was shy of Wall Street expectations.

In its flagship North American market, Coca-Cola has been relying on a shifting mix of products amid changing consumer tastes and criticism over the role sugary drinks play in fueling obesity rates.

The 2 percent bump in sales volume for the region was driven by what Coca-Cola refers to as its "still beverages," such as Powerade sports drinks and Fuze teas. Coke Zero, which was introduced in 2005 as a better-tasting alternative to traditional diet sodas, saw growth of 9 percent. But overall sales volume of its sodas in the region was flat from a year ago.

In an interview with the Associated Press, CEO Muhtar Kent said the U.S. market remains a growth area for the company. He noted that product innovation — such as mini-cans tailored to those watching their portions — has helped the company stay relevant and build market share.

Kent also cited the company's tests of natural, zero-calorie sweeteners for Fanta and Sprite as examples of ongoing renewal.

Taken together, Kent said that the results for the quarter show Coca-Cola has been able to "crack the calculus for growth" even in the tough economy.

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