NEW YORK, United States (AFP) — Coca-Cola plans to cut 1,200 jobs as it deepens its cost-cutting initiatives in response to sluggish soda gross sales, the corporate stated Tuesday.
The maker of Sprite and Fanta introduced the job cuts as it reported decrease second-quarter earnings due to restructuring prices and flat gross sales amid efforts to tout new low-sugar drinks in response to flagging demand for soda.
The job cuts account for about one p.c of the soda big’s 100,300 staff. Coca-Cola stated it is also increasing its cost-cutting program to attain $800 million yearly by 2019.
While the job cuts “will clearly be difficult for those impacted, these changes are critical for us to create an environment where we can accelerate growth and become the consumer-centric, total beverage company we need to be in a fast-changing world,” incoming chief government James Quincey stated in an announcement.
Net earnings within the first quarter plunged to $1.2 billion, down 20.three p.c from the year-ago interval.
Revenues fell 11.three p.c to $9.1 billion, reflecting decrease gross sales from bottlers that have been offered to franchisees as a part of a company reorganization.
One-time prices related to the bottling refranchising additionally dented earnings.
Volumes have been flat globally, together with in North America, the largest area by income, and fell three p.c in Latin America due to weak point in Brazil and Venezuela.
Coca-Cola goals to ship a “more consumer-centric portfolio that meets people’s changing tastes and preferences,” stated Quincey, who will develop into chief government subsequent month.
New product choices embody “Honest Sport,” a sports activities drink that’s an offshoot of the low-sugar Honest Tea. The firm is also launching Coca-Cola Plus in Japan, a no-sugar drink with dietary fiber geared toward Japan’s giant growing older inhabitants.
“Importantly, these portfolio changes will help our consumers moderate the amount of added sugar they consume.”
Coca-Cola shares dipped zero.2 p.c to $43.19 in afternoon buying and selling.
© Agence France-Presse