Coca-Cola Consolidated(COKE) - 2025 Q1 - Quarterly Results

Q1 2025 Performance Overview Key Financial Highlights Coca-Cola Consolidated's Q1 2025 saw declines in net sales, gross profit, and operating income, largely due to fewer selling days Q1 2025 vs. Q1 2024 Key Results | (in millions) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Volume | 76.7 | 82.1 | (6.6)% | | Net sales | $1,580.0 | $1,591.6 | (0.7)% | | Gross profit | $627.1 | $640.6 | (2.1)% | | Income from operations | $189.8 | $215.4 | (11.9)% | - The first quarter of 2025 had two fewer selling days compared to the first quarter of 2024, which negatively impacted results[4] Q1 2025 Beverage Sales Breakdown | (in millions) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Sparkling bottle/can | $933.8 | $952.0 | (1.9)% | | Still bottle/can | $509.2 | $511.6 | (0.5)% | Detailed Operational Review Q1 2025 performance was significantly affected by calendar effects and a Dasani distribution change, impacting volume and net sales - Volume declined 6.6% in Q1 2025. Two fewer selling days accounted for 2.1% of the decline, and a change in Dasani water distribution to a non-DSD method accounted for another 1.3%[6] - Net sales were negatively impacted by approximately $40 million (2.5% of net sales change) due to two fewer selling days, which was partially offset by 2025 pricing actions[6] - Excluding Dasani, net sales in the Still category grew 1.8%, driven by sports drinks, protein, and enhanced water products. The company also began distributing Topo Chico mineral water in the quarter[7][9] - Selling, delivery and administrative (SD&A) expenses rose 2.9%, primarily due to increased labor costs from annual wage adjustments and general inflation[9] - Net income was $103.6 million (GAAP) and $136.3 million (Adjusted). The GAAP figure was adversely impacted by a non-cash fair value adjustment to an acquisition-related contingent consideration liability[11] - Cash flow from operations was $198.2 million. The company invested $98 million in capital expenditures and expects total 2025 capex to be approximately $300 million[12] Financial Statements Condensed Consolidated Statements of Operations For Q1 2025, the company reported decreased net sales, gross profit, and income from operations, with a notable decline in net income and diluted earnings per share Q1 2025 Statement of Operations Summary (in thousands) | | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net sales | $1,579,977 | $1,591,626 | | Gross profit | $627,104 | $640,559 | | Income from operations | $189,820 | $215,406 | | Net income | $103,611 | $165,741 | | Diluted net income per share (Common) | $11.87 | $17.66 | Condensed Consolidated Balance Sheets As of March 28, 2025, total assets slightly increased, cash and cash equivalents rose, total liabilities remained stable, and stockholders' equity grew from year-end 2024 Balance Sheet Summary (in thousands) | | March 28, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $1,151,805 | $1,135,824 | | Total current assets | $2,613,434 | $2,547,302 | | Total assets | $5,403,738 | $5,313,139 | | Total current liabilities | $1,290,191 | $1,313,169 | | Total liabilities | $3,904,324 | $3,895,528 | | Stockholders' equity | $1,499,414 | $1,417,611 | Condensed Consolidated Statements of Cash Flows In Q1 2025, the company generated strong net cash from operating activities, while utilizing cash for investing and financing activities, resulting in a net increase in cash for the period Q1 Cash Flow Summary (in thousands) | | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $198,171 | $194,273 | | Net cash used in investing activities | $(139,695) | $(263,262) | | Net cash used in financing activities | $(42,495) | $(165,020) | | Net increase (decrease) in cash | $15,981 | $(234,009) | | Cash at end of period | $1,151,805 | $401,260 | Non-GAAP Financial Measures Reconciliation of GAAP to Non-GAAP Results The company provides adjusted non-GAAP results to offer a clearer view of ongoing performance by excluding fair value adjustments and other items - On a comparable basis, which adjusts for the two fewer selling days in Q1 2025, volume declined 4.5% year-over-year[24] Q1 2025 GAAP to Non-GAAP Reconciliation (in thousands) | | Net income | Basic net income per share | | :--- | :--- | :--- | | Reported results (GAAP) | $103,611 | $11.88 | | Fair value adjustment of acquisition related contingent consideration | $32,174 | $3.69 | | Fair value adjustments for commodity derivative instruments | $477 | $0.05 | | Adjusted results (non-GAAP) | $136,262 | $15.62 | Other Information About Coca-Cola Consolidated, Inc. Coca-Cola Consolidated, Inc. is the largest Coca-Cola bottler in the United States, serving approximately 60 million consumers across 14 states and D.C. - Coca-Cola Consolidated is the largest Coca-Cola bottler in the United States[14] - The company serves approximately 60 million consumers across 14 states and the District of Columbia[14] Cautionary Note Regarding Forward-Looking Statements This news release contains forward-looking statements subject to risks and uncertainties, including inflation, supply chain issues, and changes in consumer preferences - The report contains forward-looking statements that are not guarantees of future performance and are subject to risks and uncertainties[16] - Identified risk factors include inflation, supply chain shortages, changes in consumer perception, government regulation, cybersecurity attacks, and economic downturns[16]