Coca-Cola Reports Fourth Quarter and Full-Year 2021 Results

• Global Unit Case Volume Grew 9% for the Quarter and 8% for the Full Year
• Net Revenues Grew 10% for the Quarter and 17% for the Full Year;
• Organic Revenues (Non-GAAP) Grew 9% for the Quarter and 16% for the Full Year
• Operating Income Declined 28% for the Quarter and Grew 15% for the Full Year;
• Comparable Currency Neutral Operating Income (Non-GAAP) Declined 12% for the Quarter and Grew 12% for the Full Year
• Fourth Quarter EPS Grew 65% to $0.56, and Comparable EPS (Non-GAAP) Declined 5% to $0.45;
• Full-Year EPS Grew 26% to $2.25, and Comparable EPS (Non-GAAP) Grew 19% to $2.32
• Cash Flow from Operations Was $12.6 Billion for the Full Year, Up 28%;
• Full-Year Free Cash Flow (Non-GAAP) Was $11.3 Billion, Up 30%

The Coca-Cola Company today reported fourth quarter and full-year 2021 results, including another quarter of sequential improvement in volume trends compared to 2019. “In 2021, our system demonstrated resilience and flexibility by successfully navigating through another year of uncertainty,” said James Quincey, Chairman and CEO of The Coca-Cola Company. 

“We focused on our key strategies and emerged stronger. We are confident that progress on our strategic transformation has made us a nimbler total beverage company. While the environment remains dynamic, we will build on the momentum from 2021 to drive topline growth and maximize returns.”

Quarterly / Full-Year Performance

• Business environment: Compared to 2019, global unit case volume sequentially improved each quarter in 2021, resulting in full-year unit case volume being ahead of 2019. This performance was driven by ongoing, asynchronous recovery in many markets and the company’s ability to better adapt to successive waves of the pandemic. The fourth quarter marked the first quarter in which away-from-home volume was ahead of 2019, while strength in at-home channels also continued. Although reopenings continue to vary across the world, the company is combining the power of scale with the deep knowledge required to win locally and is continuing to invest ahead of the recovery in a targeted way.

• Strengthening a consumer-centric portfolio through strategic acquisitions: During the fourth quarter, the company acquired the remaining 85% ownership interest in BODYARMOR, a line of sports performance and hydration beverages that has significant potential for long-term growth. Since gaining access to the company’s bottling system three years ago, BODYARMOR has driven continuous innovation in hydration products. For full-year 2021, BODYARMOR was the #2 sports drink in the category in measured retail channels in the United States, with retail value growth of approximately 50%. BODYARMOR will continue to be distributed by the company’s U.S. bottling system and will be managed as a separate business within the company’s North America operating unit.

• Transforming and modernizing marketing through one global marketing network partner: After an extensive review in 2021, the company named WPP as its global marketing network partner. WPP will play a key role in executing a new marketing model to drive long-term growth for the company’s global portfolio of brands. The new, integrated agency model is consumer-centric and leverages the power of big, bold ideas and creativity within experiences. The company intends to create end-to-end experiences that are grounded in data-rich consumer insights, optimized in real-time and implemented at scale. WPP, supported by a common data and technology platform that connects marketing teams throughout the company, will work with a strategic roster of approved agencies to provide access to the best creative minds and ideas.

• Further embedding sustainability into the business, including a new packaging target: The company’s environmental, social and governance (ESG) goals are embedded in operations and serve as key drivers of growth. To complement and support its World Without Waste goals, the company announced a new, global goal to reach 25% reusable packaging by 2030. Reusable packaging, including refillable containers for dispensed/fountain along with refillable or returnable glass and plastic bottles, supports the company’s collection goals and contributes to reducing the company’s carbon footprint, while aligning with consumer preferences for sustainable packaging options. Increasing reusable packaging and dispensed options responds to both consumer affordability and sustainability preferences, making it one of several important commercial levers to help achieve the company’s World Without Waste goals and contribute to the circular economy.

Operating Review – Three Months Ended December 31, 2021

Revenues and Volume
Percent Change	Concentrate Sales 1	Price/Mix	Currency Impact	Acquisitions, Divestitures and Structural Changes, Net	Reported Net Revenues		Organic Revenues 2		Unit Case Volume 3
Consolidated	(1)	10	(1)	1	10		9		9
Europe, Middle East & Africa	4	13	(2)	0	15		17		11
Latin America	(10)	11	1	0	2		2		5
North America	4	9	0	3	17		14		8
Asia Pacific	4	(8)	(3)	0	(6)		(3)		11
Global Ventures 4	10	15	2	0	27		25		19
Bottling Investments	6	(3)	(1)	0	2		3		13

Operating Income and EPS
Percent Change	Reported Operating Income	Items Impacting Comparability	Currency Impact	Comparable Currency Neutral 2
Consolidated	(28)	(17)	1	(12)
Europe, Middle East & Africa	1	(7)	0	8
Latin America	0	(1)	4	(3)
North America	(17)	(16)	0	(1)
Asia Pacific	(31)	0	(3)	(29)
Global Ventures	— 5	—	—	—
Bottling Investments	(11)	(4)	5	(12)
Percent Change	Reported EPS	Items Impacting Comparability	Currency Impact	Comparable Currency Neutral 2
Consolidated EPS	65	70	2	(6)

Note: Certain rows may not add due to rounding.
1	For Bottling Investments, this represents the percent change in net revenues attributable to the increase (decrease) in unit case volume computed based on total sales (rather than average daily sales) in each of the corresponding periods after considering the impact of structural changes, if any.
2	Organic revenues, comparable currency neutral operating income and comparable currency neutral EPS are non-GAAP financial measures. Refer to the Reconciliation of GAAP and Non-GAAP Financial Measures section.
3	Unit case volume is computed based on average daily sales.
4	Due to the combination of multiple business models in the Global Ventures operating segment, the composition of concentrate sales and price/mix may fluctuate materially on a periodic basis. Therefore, the company places greater focus on revenue growth as the best indicator of underlying performance of the Global Ventures operating segment.
5	Reported operating income for Global Ventures for the three months ended December 31, 2021 was $78 million. Reported operating loss for Global Ventures for the three months ended December 31, 2020 was $9 million. Therefore, the percent change is not meaningful.

Revenues and Volume
Percent Change	Concentrate Sales 1	Price/Mix	Currency Impact	Acquisitions, Divestitures and Structural Changes, Net	Reported Net Revenues		Organic Revenues 2		Unit Case Volume
Consolidated	9	6	1	0	17		16		8
Europe, Middle East & Africa	12	6	1	0	19		18		9
Latin America	6	12	0	0	18		19		6
North America	7	7	0	0	15		14		5
Asia Pacific	11	(2)	3	0	12		9		10
Global Ventures 3	20	13	7	0	41		34		17
Bottling Investments	11	2	2	0	15		13		11

Operating Income and EPS
Percent Change	Reported Operating Income	Items Impacting Comparability	Currency Impact	Comparable Currency Neutral 2
Consolidated	15	1	2	12
Europe, Middle East & Africa	13	(2)	1	13
Latin America	20	1	1	18
North America	35	16	0	19
Asia Pacific	9	1	4	4
Global Ventures	— 4	—	—	—
Bottling Investments	53	11	(2)	43
Percent Change	Reported EPS	Items Impacting Comparability	Currency Impact	Comparable Currency Neutral 2
Consolidated EPS	26	7	2	17

In addition to the data in the preceding tables, operating results included the following:

Consolidated

• Unit case volume grew 9% for the quarter and 8% for the year, resulting in volume ahead of 2019. Volume growth was strong across most markets. The volume performance was driven by investments in the marketplace, ongoing recovery in markets where coronavirus-related uncertainty was abating, and the benefit from cycling the impact of the pandemic in the prior year. For both the quarter and the year, growth in developing and emerging markets was led by China, India and Russia, while growth in developed markets was led by the United States, Mexico and the United Kingdom.

Category performance was as follows:

• Sparkling soft drinks grew 8% for the quarter and 7% for the year, resulting in volume ahead of 2019, driven by strong performance across all geographic operating segments. Trademark Coca-Cola grew 7% for both the quarter and the year, resulting in volume ahead of 2019, led by Europe, Middle East & Africa and Asia Pacific. Coca-Cola® Zero Sugar grew double digits for both the quarter and the year. Sparkling flavors grew 9% for both the quarter and the year, led by Europe, Middle East & Africa and Asia Pacific.

• Nutrition, juice, dairy and plant-based beverages grew 11% for the quarter and 12% for the year, resulting in volume ahead of 2019. For both the quarter and the year, there was strong growth across all geographic operating segments.

• Hydration, sports, coffee and tea grew 12% for the quarter and 7% for the year. Hydration grew 11% for the quarter and 5% for the year, with growth across all geographic operating segments. Sports drinks grew 18% for the quarter and 13% for the year, resulting in volume ahead of 2019, primarily driven by strong growth of BODYARMOR in the United States. Tea grew 10% for the quarter and 6% for the year, led by growth in Japan and the United States. Coffee grew 17% for the quarter and 15% for the year, primarily driven by the ongoing reopening of Costa® retail stores in the United Kingdom.

• Price/mix grew 10% for the quarter and 6% for the year, driven by pricing actions in the marketplace along with favorable channel and package mix due to cycling the impact of the pandemic in the prior year. Price/mix for the quarter was further benefited by positive segment mix. For the quarter, concentrate sales were 10 points behind unit case volume. This was primarily attributable to six fewer days in the quarter, which resulted in an approximate 6-point impact on concentrate sales, along with the timing of concentrate shipments. For the full year, concentrate sales were 1 point ahead of unit case volume, primarily due to bottler inventory build to manage near-term supply disruption.

• Operating income declined 28% for the quarter and grew 15% for the year, which included items impacting comparability and currency tailwinds. Comparable currency neutral operating income (non-GAAP) declined 12% for the quarter, driven by a significant increase in marketing investments versus the prior year. Additionally, fourth quarter operating income was impacted by topline pressure from six fewer days in the quarter. Comparable currency neutral operating income (non-GAAP) grew 12% for the full year, driven by strong organic revenue (non-GAAP) growth across all operating segments, partially offset by a significant increase in marketing investments versus the prior year.

Europe, Middle East & Africa

• Unit case volume grew 11% for the quarter, a low single-digit increase versus 2019, driven by ongoing recovery in markets where coronavirus-related uncertainty was abating, along with the benefit from cycling the impact of the pandemic in the prior year. Growth was led by Russia and Spain in Europe, Nigeria in Africa, and Turkey in Eurasia and Middle East.

• Price/mix grew 13% for the quarter, driven by favorable channel and package mix due to cycling the impact of the pandemic in the prior year, along with positive geographic mix. For the quarter, concentrate sales were 7 points behind unit case volume, primarily due to six fewer days in the quarter.

• Operating income grew 1% for the quarter, which included items impacting comparability. Comparable currency neutral operating income (non-GAAP) grew 8% for the quarter, primarily driven by solid organic revenue (non-GAAP) growth across all operating units, partially offset by a significant increase in marketing investments versus the prior year.

• For the year, the company gained value share in total NARTD beverages, which included share gains across most categories.

Latin America

• Unit case volume grew 5% for the quarter, a mid single-digit increase versus 2019. Growth was led by Mexico, Argentina and Chile, driven by growth in most categories.

• Price/mix grew 11% for the quarter, driven by pricing actions in the marketplace, favorable channel and package mix, along with the timing of deductions. For the quarter, concentrate sales were 15 points behind unit case volume, primarily due to six fewer days in the quarter and the timing of concentrate shipments.

• Operating income was even for the quarter, which included items impacting comparability and a 3-point currency tailwind. Comparable currency neutral operating income (non-GAAP) declined 3% for the quarter, driven by an increase in marketing investments versus the prior year.

• For the year, the company gained value share in total NARTD beverages, led by share gains in Mexico, Argentina, Brazil and Colombia.

North America

• Unit case volume grew 8% for the quarter, resulting in even performance versus 2019. Growth was driven by recovery in the fountain business as coronavirus-related uncertainty abated. Sparkling soft drinks and sports drinks led the growth during the quarter.

• Price/mix grew 9% for the quarter, primarily driven by pricing actions in the marketplace, recovery in the fountain business and away-from-home channels, and strong growth in premium offerings. For the quarter, concentrate sales were 4 points behind unit case volume, primarily due to six fewer days in the quarter.

• Operating income declined 17% for the quarter, which included items impacting comparability. Comparable currency neutral operating income (non-GAAP) declined 1% for the quarter, driven by a significant increase in marketing investments versus the prior year.

• The company gained value share in total NARTD beverages for the year, driven by recovery in away-from-home channels along with strong performance in at-home channels for sparkling flavors, sports drinks and dairy.

Asia Pacific

• Unit case volume grew 11% for the quarter, resulting in a low single-digit increase versus 2019. Growth was driven by China, India and the Philippines, partially offset by pressure in Australia due to the impact of the pandemic. Growth was led by Trademark Coca-Cola and sparkling flavors.

• Price/mix declined 8% for the quarter due to negative channel mix in key markets along with 4 points of negative geographic mix due to growth in emerging and developing markets outpacing developed markets. For the quarter, concentrate sales were 7 points behind unit case volume, primarily due to six fewer days in the quarter.

• Operating income declined 31% for the quarter, which included a 2-point currency headwind. Comparable currency neutral operating income (non-GAAP) declined 29% for the quarter, driven by topline pressure along with a significant increase in marketing investments versus the prior year.

• The company’s value share in total NARTD beverages was even for the year, as strong underlying share gains in most markets were offset by the impact of negative geographic mix in the operating segment.

Global Ventures

• Net revenues grew 27% for the quarter, which included a 2-point currency tailwind. Organic revenues (non-GAAP) grew 25%. Revenue growth was primarily driven by the ongoing reopening of Costa retail stores in the United Kingdom.

• Operating income growth and comparable currency neutral operating income (non-GAAP) growth for the quarter were driven by strong organic revenue (non-GAAP) growth.

Bottling Investments

• Unit case volume grew 13% for the quarter, driven by strong growth in the key markets of India and the Philippines.

• Price/mix declined 3% for the quarter, primarily due to weather-related disruption and negative package mix in South Africa.

• Operating income declined 11% for the quarter, including items impacting comparability and a 5-point tailwind from currency. Comparable currency neutral operating income (non-GAAP) declined 12% for the quarter, driven by an increase in operating expenses versus the prior year.

Capital Allocation Update

• Reinvesting in the business: The company continued to invest in its various lines of business and spent $1.4 billion in capital expenditures in 2021, an increase of 16% versus the prior year.

• Continuing to grow the dividend: The company paid dividends totaling $7.3 billion during 2021. The company has increased its dividend in each of the last 59 years.

• Consumer-centric M&A: The company acquired the remaining 85% ownership interest in BODYARMOR, a line of sports performance and hydration beverages, in November 2021 for $5.6 billion.

• Share repurchases: In 2021, the company did not repurchase any shares under the existing share repurchase authorization. The company’s remaining share repurchase authorization is approximately $10 billion.

February 10, 2022