Coca-Cola sales rebound to pre-pandemic levels after last year’s plunge

ORIGINAL CAPTION: November 28, 2014 Atlanta - Picture shows Coca-Cola Company Headquarters in Atlanta on Friday, November 28, 2014. Coca-Cola reported $233 million in tax breaks in 2011-2013 - almost 15% of its federal tax bill - related to giving its management stock options and restricted stock. HYOSUB SHIN / HSHIN@AJC.COM
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Atlanta-based Coca-Cola Co. has enjoyed a sharp rebound in business recently as more consumers go out. It's a stark difference from tough financial results earlier in the pandemic last year. HYOSUB SHIN / HSHIN@AJC.COM

Credit: Hyosub Shin / Hyosub.Shin@ajc.com

Credit: Hyosub Shin / Hyosub.Shin@ajc.com

Here’s another sign a thirsty world is rebounding from the pandemic: Coca-Cola Co. has regained the financial footing it lost last year when people hunkered down at home.

The Atlanta-based beverage giant on Wednesday reported second-quarter revenue and profit soared above its 2020 results and even topped 2019, well before COVID-19 struck.

One of Georgia’s biggest companies, Coke grew in all four of its big regions globally. Beverage volumes rose 18% in the three months ended July 2, compared with the same period a year earlier. In the U.S., the company saw large rebounds in sales to people who are out and about, particularly in restaurants.

“We’ve always believed that humans are social creatures,” Coke CEO James Quincey told analysts.

Last year, traffic plunged at restaurants and bars, convenience stores, movie theaters, concert halls and sports arenas — the sorts of places that normally account for half the company’s sales. The volume of drinks sold shrank 6%, Coke’s steepest annual drop since just after World War II and only the second decline in nearly seven decades.

Despite the recovery, economic ripple effects from the pandemic remain, including in the U.S.

“It’s not over and we can see that in the numbers,” Quincey said.

For example, while its beverage business at bars and to people who are traveling have grown sharply compared with last year, they have yet to reach 2019 levels.

The recovery globally isn’t smooth. Vaccination rates have lagged, allowing the delta variant to take hold and create spikes in hospitalizations among the unvaccinated. Some areas, including parts of the U.S., have reinstated restrictions, affecting results for one of the world’s best-known brands.

Still, “our results in the second quarter show how our business is rebounding faster than the overall economic recovery,” Quincey said in a press release. That has led Coke to boost its financial forecast for 2021.

In the second quarter, the company’s operating revenue jumped 42% to $10.13 billion and net income increased 48% to $2.64 billion from a year earlier.

The company is also leaner than a year ago, when the troubles led Coke to speed up plans for a global reorganization. That included both voluntary separations and layoffs that resulted in 2,200 fewer jobs. About 500 of the jobs were in metro Atlanta, amounting to nearly 10% of the company’s local workforce.

Some big Georgia-based companies saw big gains during the pandemic, including Home Depot and UPS, which benefited from a surge in home improvements and door-to-door deliveries of packages as many consumers stayed put.

But many other big companies faced turmoil that has been tough to overcome. While Delta Air Lines has seen more leisure travelers recently, business and international travel remains depressed, and the company’s return to profitability so far has hinged on financial help from the federal government.

Coke said its North American beverage sales volume grew 17% in the second quarter from a year earlier. Overseas markets such as China, Brazil and Nigeria also rebounded sharply but other countries, including India, continued to struggle.

The company’s namesake cola brand grew 12%, also pushing it above 2019 volumes, boosted by consumers in Europe, the Middle East, Africa and Latin America.

But other beverages bounced back even more dramatically. Coke’s nutrition, juice, dairy and plant-based brands grew 25%, helped in part by Minute Maid and Fairlife in North America. Hydration, sports, coffee and tea brands also grew 25% globally.

Coca-Cola’s financial performance

Second-quarter revenue:

2021 -- $10.13 billion

2020 -- $7.15 billion

2019 -- $10.00 billion

Second-quarter net income:

2021 -- $2.64 billion

2020 -- $1.78 billion

2019 -- $2.61 billion