Coca-Cola aims to get back sales fizz after Covid-19 slump                           

Coca-Cola sales are inching back toward normal, even as it warns a resurgent virus could continue to muddle near-term results.

Global unit case volume was down 4% in the third quarter as the restaurants and entertainment venues that make up about half of revenues aren’t yet back to normal. Still, that’s far better than the second quarter when volume fell 16%. Some increase in at-home consumption has helped offset the problems in public spaces.

“Our brand portfolio is working hard to return to pre-Covid levels of growth and we have made progress,” chief executive James Quincey said on an earnings call.

“However, it’s important to remember the world is in a fragile state, and we’ve seen reopening trends begin to moderate,” he added. “We don’t expect to return to the peak levels of global lockdown, but we are prepared for setbacks due to the local spikes in cases and targeted restrictions and closures.” 

The company will continue to cut down the number of products it sells, with a goal of offering about 200 master brands

Coke executives said in July that the drinks giant had made it through the worst of the downturn. Still, Mr Quincey warned this summer that the global economy could take two to three years to recover. The sequential improvement is slow: The percentage decline in global unit case volume for October month-to-date remained in the low single digits. 

There were some bright spots in the quarter. Trademark Coca-Cola grew 1%, it said, while Coca-Cola Zero Sugar grew 7% in the quarter. At the same time, tea and coffee declined 15%, primarily driven by virus-related challenges at Costa retail stores. 

The company will continue to cut down the number of products it sells, with a goal of offering about 200 master brands, a 50% reduction from the current level. 

“We’re trying to end up with a blueprint that we think is right for the future,” chief financial officer John Murphy said in an interview. “We’re going to have to make some tough decisions.” 

Competitor PepsiCo offered a full-year outlook when it reported results earlier this month. Coke, however, said it couldn’t give a forecast given the virus uncertainty. Still, executives said they’re confident it will return to the high end of its long-term growth model.

“I think there is some caution because when you actually drill in and look at the world, there’s a lot of different dynamics at play and therefore very difficult to predict what the near term looks like,” Mr Murphy said. “We still think the actions that we are cementing and putting in place set us up very well for when things actually turn and are back to a more normal environment.” 

— Bloomberg