Coca-Cola volumes have dropped by a quarter so far this month, showing how coronavirus lockdown is even hurting businesses that Wall Street generally considers less vulnerable to recessions.
The $ 200 billion group said that even though customers were storing drinks at home, sales had been affected by the closure of bars, restaurants and stadiums. These “out-of-home channels” represent around half of its revenues.
Net sales for the three months ending March decreased 1% from a year ago to $ 8.6 billion, while operating profits fell 2% to $ 2.38 billion. However, as a sign that the impact will be greater in the current quarter, Coke said that since the beginning of April, volumes had dropped by around 25%. Almost all of the drop concerned out-of-home channels.
Although he was unable to quantify the result compared to the annual results, Coke said the effects of the closure would be “significant” in the second quarter.
James Quincey, President and CEO, said in a statement: “We have already gone through difficult times as a business, and we believe we are well positioned to manage and emerge stronger.”
Coke’s portfolio includes Schweppes, Fanta and Appletiser as well as its namesake brands. He bought the British chain Costa Coffee for £ 3.9 billion as part of a deal in 2018.