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Coca-Cola sees Q2 hit from public venue closures

Agence France-Presse
Coca-Cola sees Q2 hit from public venue closures
Coca-Cola's 1st quarter sales get a boost from consumers stocking up during lockdowns, but it expects 2nd quarter results to suffer as public venues are not operating

NEW YORK, USA – Coca-Cola warned on Tuesday, April 21, that physical distancing measures to combat the coronavirus are weighing on sales in the current period as the company reported a jump in 1st quarter profits.

Net income rose 65% to $2.8 billion, boosted in part by the one-time accounting of its acquisition of the Fairlife dairy company.

Revenues dipped 1% to $8.6 billion, with Asia Pacific suffering the biggest decline following China’s coronavirus outbreak.

The cola giant said 1st quarter sales got a lift from pantry loading as consumers boosted purchases of soda and other items as governments enacted lockdown measures

But Coca-Cola said 2nd quarter results would suffer because of the significant drop in “away-from-home” channels with the suspension of major sporting events and the closing of restaurants, movie theaters, and other public venues.

“The ultimate impact on the 2nd quarter and full-year 2020 is unknown at this time, as it will depend heavily on the duration of social distancing and shelter-in-place mandates, as well as the substance and pace of macroeconomic recovery,” the company said. “However, the impact to the 2nd quarter will be material.”

Coca-Cola joined the large group of companies that withdrew full-year forecasts due to uncertainty.

Shares dipped 0.3% to $46.40 in pre-market trading. –

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