Coca-Cola Earnings Boosted by New Diet Flavors

By Cara Lombardo 

Coca-Cola Co.'s Diet Coke returned to volume growth in North America for the first time since 2010 after the drinks company added four new flavors in skinny, colorful cans.

Analysts have been skeptical that adding flavors like Zesty Blood Orange and Twisted Mango, which are still artificially sweetened, will bring back soda drinkers who have moved on to more natural-seeming options like sparkling water and tea. The last time Diet Coke's quarterly volumes increased in North America, its largest region by sales, was the fourth quarter of 2010, a company spokesman said. Diet Coke's sales volume in the U.S. has declined every year since 2006, according to industry-publication Beverage Digest.

The launch appeared to be "bold enough and interesting enough" to not just engage lapsed Diet Coke drinkers but also millennials and fans of sparkling water, Chief Executive James Quincey told analysts on an earnings call.

The new drinks hit shelves in January, so the results reflect only the first several weeks of sales. Mr. Quincey warned sales could soften.

Across its portfolio, Coca-Cola's drink volume grew 3% in its first quarter, including a 4% rise in soda volume and a 5% rise in coffee and tea volumes.

The drinks company's first-quarter organic revenue, which excludes currency swings, acquisitions and divestitures, increased 5% from a year ago. Overall, revenue fell 16% to $7.6 billion, due to the divestiture of bottling operations. Analysts polled by Thomson Reuters had expected $7.34 billion in revenue.

The Atlanta-based company reported a profit of $1.37 billion, compared with $1.2 billion a year ago. On an adjusted basis, the company earned 47 cents a share, just above the 46 cents analysts expected.

Write to Cara Lombardo at [e-mail]

(END) Dow Jones Newswires

April 24, 2018 09:50 ET (13:50 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.