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Coca-Cola reports Q4 net loss of $2.75bn

DBR Staff Writer Published 19 February 2018

The Coca-Cola Company has reported a net loss of $2.75bn, or $0.65 per diluted share, for the fourth quarter of 2017 after being hit with a $3.6bn tax charge, compared to a net profit of $550m, or $0.13 per diluted share, for the same period of 2016.

With the introduction of the Tax Reform Act last year, the company will now have to pay a tax of historical offshore earnings that were not repatriated to the US.

Coca-Cola reported that its net revenues declined 20% to $7.5bn for the quarter and declined 15% to $35.4bn for the year, impacted by headwinds of 26% and 17%, respectively, from the ongoing refranchising of bottling territories.

Cash from operations for the full year was $7bn, down 20%, while the full year free cash flow (non-GAAP) was $5.3bn, down 19%.

The company stated that the declines were primarily driven by comparability items related to the refranchising of North America bottling territories, including the establishment of third-party receivables and cash restructuring charges.

In January 2018, Coca Cola had re-launched low-calorie, Diet Coke in four new flavours including ginger-lime, feisty cherry, blood orange and twisted mango, earlier this year and has also focused on non-fizzy beverages such as Georgia coffee and Glaceau vitamin water.

“The U.S. Coca-Cola system is now fully refranchised after the closing of two important territories during the quarter. Liberty Coca-Cola Beverages, a newly formed bottler, began operations in the former Tri-State Metro Operating Unit, and Reyes Coca-Cola Bottling took on new bottling territories in the former West Operating Unit,” the company said in a statement.

The Coca-Cola Company president and CEO James Quincey said: "I am pleased with our accomplishments and results in 2017. We achieved or exceeded our full year guidance while driving significant change as we continued to transform into a total beverage company. While there is still much work to do, I am encouraged by our momentum as we head into 2018."

Image: Coca-Cola’s results for 2017 shrink. Photo: Courtesy of The Coca-Cola Company.