Coca-Cola's Q4 sales volumes drop on global COVID-19 shutdowns

Houston — Coca-Cola expects its sales volume to rebound in 2021 as COVID-19 vaccinations grow, following fourth-quarter 2020 drops in all regions except Latin America, executives said Feb. 10.

"There is no doubt the near-term trajectory of our recovery will still be impacted by the presence of the virus in most markets," CEO James Quincey said during the company's Q4 2020 earnings call.

Coca-Cola, a top buyer of virgin and recycled polyethylene terephthalate, a resin used to make plastic bottles, saw volumes decline when the coronavirus pandemic hit in 2020, prompting shutdowns of major gatherings where bottled drinks sell heavily, such as sports events, concerts.

The company's quarterly volumes in China showed gains, while Japan showed soft traffic in vending machine sales and India showed signs of recovery in sales outside of homes, Quincey said.

Europe, Middle East and Africa regions showed resilience despite varied levels of lockdowns in Q4, and North America's away-from-home volumes saw impacts in multiple states with restrictions on indoor dining and at bars, Quincey said.

The company's net revenues fell 5% in the quarter to $8.6 billion. The company reported Q4 net income of $1.456 billion, down 28.7% from $2 billion in the year-ago period. For the year, Coca-Cola reported profits of $7.747 billion, down 13% from $8.92 billion in 2019.

Recovery seen in H2 2021

CFO John Murphy said the company expects to be dealing with COVID-19 for the better part of 2021, with the first half more challenging than the second.

He said sales volumes so far in 2021 were down to mid-single digits, and "to the degree the top line is driven by away-from-home recovery, we'd expect the channel and package pressures experienced last year to abate."

US virgin PET prices were last assessed Feb. 3 at $1,069/mt DDP US West Coast, a 12-month high in formula-based pricing stemming from upstream feedstock costs, S&P Global Platts data showed. Recycled PET clear flakes were last assessed Feb. 9 at 45 cents/lb ($992.08/mt) FOB Los Angeles, Platts data showed.

Coca-Cola on Feb. 9 announced the launch of its first-ever 13.2oz bottle in the US made from 100% recycled PET. The company will start distributing Coke products in those bottles in February in the US Northeast, Florida and California. Larger 20oz rPET Coke bottles also will be available in February in California and New York, followed by Texas in spring 2021.