Post Earnings Coverage as Coca-Cola's Q4 Organic Revenue Rose 6% Y-o-Y
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Upcoming AWS Coverage on SodaStream Post-Earnings Results
LONDON, UK / ACCESSWIRE / March 1, 2017 / Active Wall St. announces its post-earnings coverage on The Coca-Cola Co. (NYSE: KO). The Company disclosed its financial results for the fourth quarter fiscal 2016 (Q4 FY16) and full year fiscal 2016 (FY16) on February 09, 2017. The Atlanta, Georgia-based Company's quarterly net revenues and non-GAAP diluted EPS fell on a year-over-year basis; however both results beat market consensus estimates. Register with us now for your free membership at:
One of Coca-Cola's competitors within the Beverages - Soft Drinks space, SodaStream International Ltd. (NASDAQ: SODA), reported on February 15, 2017, its results for the three months and year ended December 31, 2016. AWS will be initiating a research report on SodaStream in the coming days.
Today, AWS is promoting its earnings coverage on KO; touching on SODA. Get our free coverage by signing up to:
During the quarter ended on December 31, 2016, Coca-Cola reported net operating revenues of $9.41 billion which came in 6% below the $10.00 billion recorded at the end of Q4 FY15. However, net operating revenues numbers for the reported quarter outperformed market expectations of $9.10 billion. The Company faced a 2% foreign currency exchange translation headwind along with 10% headwind from acquisitions, divestitures, and structural items. Organic revenues recorded a 6% y-o-y growth during the reported period, while non-GAAP core business organic revenues grew 7% y-o-y in Q4 FY16.
The beverage Company reported Q4 FY16 net income attributable to Coca-Cola's shareowners of $550 million, or $0.13 per diluted share, compared to $1.24 billion, or $0.28 per diluted share, in Q4 FY15. The Company's non-GAAP net income attributable to Coca-Cola's shareowners for Q4 FY16 came in at $1.59 billion, or $0.37 per diluted share, compared to $1.68 billion, or $0.38 per diluted share, in the year ago same quarter. Wall Street had expected the Company to report non-GAAP net income of $0.36 per diluted share.
For full year FY16, Coca-Cola's net operating revenues were $41.86 billion, down 5% from $44.29 billion reported in FY15. The Company's net income attributable to shareowners of Coca-Cola fell during FY16 to $6.53 billion, or $1.49 per diluted share, from $7.35 billion, or $1.67 per diluted share, in FY15. Furthermore, non-GAAP net income attributable to shareowners of Coca-Cola for FY16 stood at $8.35 billion, or $1.91 per diluted share, compared to $8.80 billion, or $2.00 per diluted share, in FY15.
Operating Metrics
In Q4 FY16, the Company's GAAP gross profit fell to $5.62 billion from $5.95 billion in the prior year's comparable quarter. However, GAAP gross margin improved to 59.7% of net operating revenues in Q4 FY16 from 59.5% of net operating revenues in last year's corresponding quarter. Coca-Cola's Q4 FY16 GAAP operating income was down to $1.36 billion, or 14.4% of net operating revenues, from $1.52 billion, or $15.2% of net operating revenues, in Q4 FY15.
Segment Performance
During Q4 FY16, EMEA segment's revenue came in at $1.65 billion compared to $1.71 billion in the year ago same period. The segment reported Q4 FY16 operating income of $779 million compared to $839 million in Q4 FY15.
Coca-Cola's Latin America business revenues were $982 million in Q4 FY16, which was 4% less than last year's recorded revenues numbers of $1.02 billion. The segment's Q4 FY16 operating income was $481 million versus $528 million in Q4 FY15.
North America segment reported revenues of $2.47 billion in Q4 FY16, up 8% from $2.29 billion recorded in Q4 FY15. The segment had an operating income of $600 million in Q4 FY16 compared to $492 million in the last year's same quarter.
The Company's Asia/Pacific segment's revenues for Q4 FY16 were also up 8% y-o-y to $1.04 billion. Furthermore, the segment's operating income improved to $332 million in Q4 FY16 from $313 million in the year ago same quarter.
In Q4 FY16, Bottling Investments segment's revenue declined 20% y-o-y to $4.14 billion. Meanwhile, the segment's operating loss widened to $359 million in Q4 FY16 from $115 million in Q4 FY15.
Cash Flow & Balance Sheet
For the year ended December 31, 2016, Coca-Cola reported net cash flow from operations of $8.80 billion compared to $10.53 billion in last year's comparable period. The Company had cash and cash equivalents balance of $8.56 billion as on December 31, 2016, compared to $7.31 billion at the close of books on December 31, 2015. Furthermore, the Company ended the year with total long-term debt of $29.68 billion compared to $28.31 billion as on December 31, 2015.
Dividend
In a separate press release on February 16, 2017, Coca-Cola's Board of Directors hiked quarterly cash dividend by 6% to $0.37 per common share. The dividend is payable on April 03, 2017, to all shareowners of record as of March 15, 2017. This dividend marked the Company's 55th consecutive annual dividend increase.
Outlook
In its guidance for full FY17, Coca-Cola expects organic revenues growth to be approximately 3% with 18% to 19% headwind from acquisitions, divestitures, and structural items, and a 1% to 2% currency headwind based on the current spot rates and including the impact of hedged positions. The Company's management further anticipates a 1% to 4% y-o-y decline in comparable non-GAAP EPS in FY17.
Stock Performance
At the closing bell, on Tuesday, February 28, 2017, Coca-Cola's stock rose by 0.70% from its previous day's closing of $41.67, ending the trading session at $41.96. A total volume of 15.94 million shares were traded at the end of the day, which was higher than the 3-month average volume of 14.41 million shares. In the last month and previous three months, shares of the Company have advanced 1.23% and 1.89%, respectively. The stock is trading at a PE ratio of 28.12 and has a dividend yield of 3.53%.
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