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Coca-Cola Sales Rise, Promised by Higher Soda Demand



Coca-Cola Co.'s carbonated soda is making a comeback.

The drinking giant in recent years has expanded into coffee, tea, dairy and water as consumers move away from sugary soft drinks. But in the last quarter, CEO

James Quincey

Said, the company's sales increased largely thanks to variations in name brown cola – including some containing less sugar.

A diet version called Coke Zero Sugar has grown 14 percent by volume globally so far this year, Mr. Quincey said. And the unit sales of the company's 7.5 oz mini-boxes have increased by 15% this year in the United States. Meanwhile, the company is rolling out a coffee-flavored variant called Coca-Cola Plus Coffee and a new energy drink called Coca-Cola Energy, available in more than 25 countries and expected to launch in the United States in January.

"It is a reflection of how we have adapted our strategy to what needs to be done to help people moderate the sugar," Quincey said Friday in an interview.

The energy and coffee drink are also available in diet versions.

Coke cleared a legal hurdle earlier this year with

Monster Beverage Corp

To launch its new energy drink in the US monster, which counts Coca-Cola as its distribution partner and major shareholder, had sought to block the sale of Coke's energy drink, citing a non-compete deal.

Mr. Quincey said he hopes Coca-Cola Energy will appeal to people who are not currently buying energy drinks: “people who might not come into the category because of the taste profile that tends to be quite strong…. There is an easier way into the category. "

After launching the drink in Europe, the company fine-tuned the recipe for the American launch to make it taste more like the original Coke," he said.

In January, Coke spent $ 5.1

billion. to buy the British coffee chain Costa Coffee. Sales in the UK have been hurt by a fall in consumer confidence amid Brexit concerns, Mr. Quincey said. Coke is now talking to food service customers in the United States about bringing Costa's coffee machines here, he said.

Coke also looks at the competitive seltzer market. The Atlanta-based company in 2017 purchased a sparkling mineral water from Mexico called Topo Chico, which has a cult following in Texas. rival

PepsiCo Inc.

then launched a flavored seltzer called Bubly that has taken the share of market leader LaCroix.

"I think we have to see what we do next," Mr. Quincey said.

Coca-Cola reported higher quarterly earnings and sales on Friday, expanding recently with growth after several years of sluggish demand for sugary drinks.

Organic revenue, a measure of sales that excludes currency fluctuations, acquisitions and sales, increased by 5% from the same time a year ago. With this measure, the company now forecasts at least 5% growth for the whole year.

PepsiCo, which also has a large snack business, reported an organic revenue growth of 4.3% for the last period as it increased advertising for its largest brands.

Coke reported a profit of $ 2.59 billion, up from $ 1.89 billion a year ago. Net revenues increased by about 8% to $ 9.5 billion.

The volume of unit cases grew by 2% during the quarter. In North America, the volume of unit cases increased by 1%, driven by a 3% increase in Coca-Cola and double-digit growth in Coke Zero Sugar.

Sales of water, expanded water and sports drinks increased by 2% during the quarter. Tea and coffee volumes increased by 4%.

Write to Jennifer Maloney at jennifer.maloney@wsj.com

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