It is tough day for the market as traders express their concerns over a possible recession, surging crude oil prices and persistent weakness for the U.S. dollar. The tumbling dollar hit new lows against the euro and surging gold prices that reached $1000 an ounce made investors set off a major selloff. Coca-Cola Co. (NYSE: KO) is joining the general market anxiety, despite optimistic comments from its CEO.In a statement to India's Economic Times newspaper, Neville Isdell, the company's Chief Executive, declared he believes that both the tumbling dollar and an expansion in emerging markets will help the company achieve global growth during this year. As key elements, Isdell cited Coca-Cola's plans to spend more money on marketing, offer new products on the market and make some strategic acquisitions.
Isdell's optimistic statement came despite Wednesday's report from industry publication Beverage Digest showing that United States soft drink sales volume slipped 2.3% to 9.92 billion cases last year. The report also unveiled that the weak sales numbers came as a result of consumers' preferences for other drinks such as bottled water and teas.
Beverage Digest cited beverage companies like Coca-Cola and PepsiCo Inc. (NYSE: PEP) as being unable to gain consumers' interest in their products. In addition, the companies increased prices for their drinks by about 5% in the past year, which wasn't exactly a great move in the eyes of consumers.
However, Isdell believes that Coca Cola, the world's largest soft drink maker, will be able to "achieve good global growth," helped by improved emerging markets like India and Latin America. The company announced last month it aims to increase annual sales volume by 3% to 4% and for revenue set a target rise of 5% to 6%.
Eliza Popescu is a financial writer for the online investment advisory service Investor's Observer.
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Reader Comments (Page 1 of 1)
3-13-2008 @ 2:22PM
Michael Schneider said...
Coca-Cola's move into non-carbonated drinks appears to be helping. Fuze is fairly good & many are low calorie-- a little more expensive than soda pop but healthier. They have had a concern in the US as sales have been hurt by people eating at home more. Of course, Coca-Cola will be helped by the weak dollar as so much of their sales come from abroad. I believe they are way ahead of Pepsi in China but I haven't seen recent numbers.