Coca-Cola profit climbs 19 pct in 1st-qtr as sales soar

ATLANTA — The Coca-Cola Co.'s first-quarter profit rose 19 percent due to acquisitions and overseas growth, offsetting unimpressive results in its home North America unit that were affected by fewer people going out to eat because of fuel prices and the slowing U.S. economy.

The results beat Wall Street expectations, and its shares edged up in morning trading.

The world's biggest beverage company said its profit was $1.50 billion, or 64 cents a share, in the three-month period ending March 28. That compared to a profit of $1.26 billion, or 54 cents a share, a year earlier.

Excluding a one-time charge of 3 cents a share related to restructuring charges and asset write-downs, Atlanta-based Coca-Cola said it earned $1.58 billion, or 67 cents a share, in the quarter.

Analysts polled by Thomson Financial were expecting earnings of 63 cents a share in the quarter. Analysts generally exclude one-time items from their estimates.

Revenue rose to $7.38 billion from $6.10 billion a year earlier.

Its shares rose 29 cents to $61.23 in morning trading.

Coca-Cola said its revenue growth was helped by an increase in concentrate sales, structural changes primarily related to bottler acquisitions, currency benefits and better pricing and mix.

"Once again, our international growth drove our results," Chief Executive Neville Isdell, who will be succeeded July 1 by the company's No. 2 executive, Muhtar Kent, told analysts in a conference call.

He added, "The growth continues to be sourced from developed and emerging markets."

Worldwide unit case volume was up 6 percent for the first quarter, helped by acquisitions, and international unit case volume was up 7 percent.

The company saw strong unit case volume growth in China, India, Brazil, Turkey, Russia, Eastern Europe and the Philippines. However, in its key North America unit volume was even, due in part to the challenges in the U.S. economy, Coca-Cola said.

Coca-Cola has had problems executing its strategy in its home market in the past, and for several years it has seen weaker results in North America as compared to several other countries.

Analysts asked on the conference call whether those problems continue. Coca-Cola executives responded that they believe they have the right strategy for the unit, and they suggested the main impact on the unit in the first quarter was the slowing U.S. economy. They noted that the foodservice segment was hard hit.

"People are staying home," Chief Financial Officer Gary Fayard said, citing higher fuel prices in the U.S.

The company said key brands drove its overall results, including Coca-Cola, Fanta and Sprite.

The results were reported ahead of Coca-Cola's annual meeting later Wednesday in Wilmington, Del.

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