Running Head: THE COCA-COLA COMPANY
The Coca-Cola Company
ACC 499 Accounting Capstone
The Coca-Cola Company
The Coca-Cola Company is one of the largest beverage company's in the world. It has more than 500 brands of carbonated and non-carbonated beverages. Coca-Cola Company also has the world's largest beverage distribution system. More than 200 countries consume the company's beverages at a rate of 1.7 billion servings per day. Coca-Cola's North American market group had an organic volume increase of 2% for the first quarter 2011. Coca-Cola's cross-licensed brands volume also increased, it was mainly the Dr Pepper brands volume that grew 6% in the first quarter of 2011. Coca-Cola ...view middle of the document...
There are other factors that can influence a company's profitability such as the current economic climate, the political climate and even natural disasters. The first quarter of 2011 saw many natural disasters including the earthquake and tsunami in Japan, tornadoes and flooding all over the United States. When disasters strike the cost of production goes up, gas prices rise as well as the price of the natural resources used to produce the products sold. Strategic advertising such as the marketing campaigns that centered around NCAA March Madness basketball tournament, and the Super Bowl helps to boost product sales and offset rising costs. Marketing strategies are a key component of sales, if no one knows your product is out there how can anyone expect them to want to buy it. With the acquisition of Coca-Cola's North American operations and the expansion of cross-licensed brands such as vitaminwater zero can help operating income to increase. Product diversity also helps to drive profitability, Coca-Cola offers not only its name brand product but also a variety of concentrate product syrups, beverage bases and powders, sparkling beverages, non-carbonated or still beverages, coffees, teas, but also cross-license brands such as Sprite, Dr Pepper, smartwater, vitaminwater, Fanta, and many others. By having such a diverse and wide range in its products Coca-Cola can increase revenue by effectively penetrating many other niches such as waters, juices, energy drinks not just sodas.
Coca-Cola Company had an expected earnings per share increase of about 8.7% for the first quarter 2011. Earnings Per Share in the first quarter were reported at $0.82 which showed an increase of 19%, with comparable earnings per share at $0.86. First quarter reported earnings per share in 2011 included the integration costs of Coca-Cola Enterprises and the $102 million dollar gain on the sale of stake in a bottling partner in Chile. First quarter 2011 earnings per share were a little lower than expected but they were keeping in line with the 2010 annual earnings per share of $3.49....