• Third quarter of 2024 net sales increased 3% versus the third quarter of 2023.
  
  
• Gross profit in the third quarter of 2024 was $698 million, an increase of 5.5% versus the third quarter of 2023. Gross margin in the third quarter of 2024 improved by 90 basis points^(a) to 39.5%.
  
  
• Income from operations for the third quarter of 2024 was $227 million, an increase of $11 million, or 5%, versus the third quarter of 2023. Operating margin for the third quarter of 2024 was 12.9% as compared to 12.6% for the third quarter of 2023, an increase of 30 basis points.
  

Key Results

Third Quarter and First Nine Months 2024 Review

CHARLOTTE, N.C., Oct. 30, 2024 (GLOBE NEWSWIRE) -- Coca‑Cola Consolidated, Inc. (NASDAQ: COKE) today reported operating results for the third quarter ended September 27, 2024 and the first nine months of fiscal 2024.

“Our third quarter results reflect our steady focus on the operating fundamentals of our business. Strong commercial execution against our world class beverage portfolio, disciplined expense management and building on our purpose-driven culture are at the core of what we do every day,” said J. Frank Harrison, III, Chairman and Chief Executive Officer. “Our continued solid growth is a testament to the dedication of our teammates and our commitment to reinvest in our business to build long-term value.”

“While we are pleased with our operating results, our teammates and the communities we serve in Western North Carolina and Eastern Tennessee have suffered incredible loss as a result of Hurricane Helene,” Mr. Harrison continued. “Supporting our local communities is foundational to our culture and our Company. We are actively supporting the impacted areas as we partner with relief organizations to help our teammates, customers and communities recover from the destruction.”

Net sales increased 3.1% to $1.8 billion in the third quarter of 2024 and increased 2.6% to $5.2 billion in the first nine months of 2024. Sparkling and Still net sales increased 5.8% and 1.7%, respectively, compared to the third quarter of 2023. The net sales improvement was driven by Sparkling volume growth and pricing actions taken during the first quarter of 2024.

Standard physical case volume was down 2.1% in the third quarter of 2024 and down 1.3% in the first nine months of the year. For the first nine months of 2024, comparable^(b) standard physical case volume decreased 0.9% compared to the first nine months of 2023, which included one additional selling day. Sparkling category volume increased 0.8% during the third quarter with continued strong performance of multi-serve can packages sold in larger retail stores. Still category physical case volume declined 9.7% during the third quarter of 2024.

As noted in our second quarter 2024 results, we have shifted the distribution of casepack Dasani water sold in Walmart stores to a non-direct store delivery (DSD) method of distribution. As a result, these cases are not included in our 2024 reported case sales. The 2024 impact of this distribution change reduced our reported case sales by 1.8% during the third quarter and 0.9% during the first nine months.

“Our third quarter results reflect the power of Sparkling volume growth, margin improvement and continued strong commercial execution,” said Dave Katz, President and Chief Operating Officer. “Our Sparkling revenue grew nearly 6% this quarter reflecting the strength of our brands and the success of our price and package strategy. While we have opportunities to improve the performance of our Dasani and BodyArmor brands, we’re excited about upcoming Still category offerings designed to strengthen this segment of our business.”

Gross profit in the third quarter of 2024 was $698.0 million, an increase of $36.5 million or 5.5%. Gross margin improved 90 basis points to 39.5%. Pricing actions taken during the first quarter of 2024 along with stable commodity prices contributed to the overall improvement in gross margin. Additionally, our product mix shifted towards Sparkling beverages, which typically carry higher gross margins, during the third quarter of 2024. Gross profit in the first nine months of 2024 was $2.1 billion, an increase of $98.1 million or 5.0%.

“Our strong, consistent cash flow has allowed us to continue to reinvest in the business, strengthening our supply chain and supporting the Company’s overall growth,” Mr. Katz continued. “During the quarter, we completed the purchase of our leased production facility in Nashville, Tennessee for $56 million. We now own all of our production facilities, which we believe to be strategic assets in our operations.”

Selling, delivery and administrative (“SD&A”) expenses in the third quarter of 2024 increased $25.7 million, or 5.8%. SD&A expenses as a percentage of net sales increased 70 basis points to 26.7% in the third quarter of 2024. The increase in SD&A expenses as compared to the third quarter of 2023 was primarily driven by an increase in labor costs, mostly related to annual wage adjustments and increased incentive compensation accruals reflecting the strong operating performance in 2024. SD&A expenses in the first nine months of 2024 increased $52.5 million or 4.0%. SD&A expenses as a percentage of net sales in the first nine months of 2024 increased 40 basis points to 26.3% as compared to the first nine months of 2023.

Income from operations in the third quarter of 2024 was $227.1 million, compared to $216.3 million in the third quarter of 2023, an increase of 5.0%. For the first nine months of 2024, income from operations increased $45.6 million to $701.6 million, an increase of 7.0%. Operating margin for the first nine months of 2024 was 13.6% as compared to 13.1% for the first nine months of 2023, an increase of 50 basis points.

Net income in the third quarter of 2024 was $115.6 million, compared to $92.1 million in the third quarter of 2023, an improvement of $23.5 million. Net income for the third quarter of 2024 and the third quarter of 2023 was adversely impacted by routine, non-cash fair value adjustments to our acquisition related contingent consideration liability, driven by increases in the future cash flow projections and changes to the discount rate used to compute the fair value of the liability.

Net income in the first nine months of 2024 was $454.2 million, compared to $332.5 million in the first nine months of 2023, an increase of $121.6 million. On an adjusted^(b) basis, net income in the first nine months of 2024 was $521.9 million, compared to $488.3 million in the first nine months of 2023, an increase of $33.6 million. Net income for the first nine months of 2023 was adversely impacted by the settlement of our primary pension plan benefit liabilities during the prior year, which resulted in a non-cash charge of $117.1 million. Income tax expense for the first nine months of 2024 was $156.4 million, compared to $112.4 million for the first nine months of 2023, resulting in an effective income tax rate of 25.6% and 25.3% for the first nine months of 2024 and 2023, respectively.

Cash flows provided by operations for the first nine months of 2024 were $707.9 million, compared to $644.5 million for the first nine months of 2023. Cash flows from operations reflected our strong operating performance during the first nine months of 2024. In the first nine months of 2024, we invested $287 million in capital expenditures as we continue to enhance our supply chain and invest for future growth. During the quarter, we purchased our leased Nashville, Tennessee production facility for approximately $56.0 million. For the full year of 2024, we expect capital expenditures to total approximately $350 million.

^(a) All comparisons are to the corresponding period in the prior year unless specified otherwise.
^(b) The discussion of the operating results for the third quarter ended September 27, 2024 and the first nine months of fiscal 2024 includes selected non-GAAP financial information, such as “comparable” and “adjusted” results. The schedules in this news release reconcile such non-GAAP financial measures to the most directly comparable GAAP financial measures.

A PDF accompanying this release is available at: http://ml.globenewswire.com/Resource/Download/45b47614-4499-4af7-9d22-6ad5e5781d95

About Coca-Cola Consolidated, Inc.

Headquartered in Charlotte, N.C., Coca‑Cola Consolidated (NASDAQ: COKE) is the largest Coca‑Cola bottler in the United States. We make, sell and distribute beverages of The Coca‑Cola Company and other partner companies in more than 300 brands and flavors across 14 states and the District of Columbia, to approximately 60 million consumers. For over 122 years, we have been deeply committed to the consumers, customers and communities we serve and passionate about the broad portfolio of beverages and services we offer. Our Purpose is to honor God in all we do, to serve others, to pursue excellence and to grow profitably.

More information about the Company is available at www.cokeconsolidated.com. Follow Coca‑Cola Consolidated on Facebook, X, Instagram and LinkedIn.

Cautionary Note Regarding Forward-Looking Statements

Certain statements contained in this news release are “forward-looking statements” that involve risks and uncertainties which we expect will or may occur in the future and may impact our business, financial condition and results of operations. The words “anticipate,” “believe,” “expect,” “intend,” “project,” “may,” “will,” “should,” “could” and similar expressions are intended to identify those forward-looking statements. These forward-looking statements reflect the Company’s best judgment based on current information, and, although we base these statements on circumstances that we believe to be reasonable when made, there can be no assurance that future events will not affect the accuracy of such forward-looking information. As such, the forward-looking statements are not guarantees of future performance, and actual results may vary materially from the projected results and expectations discussed in this news release. Factors that might cause the Company’s actual results to differ materially from those anticipated in forward-looking statements include, but are not limited to: increased costs (including due to inflation), disruption of supply or unavailability or shortages of raw materials, fuel and other supplies; the reliance on purchased finished products from external sources; changes in public and consumer perception and preferences, including concerns related to product safety and sustainability, artificial ingredients, brand reputation and obesity; changes in government regulations related to nonalcoholic beverages, including regulations related to obesity, public health, artificial ingredients and product safety and sustainability; decreases from historic levels of marketing funding support provided to us by The Coca‑Cola Company and other beverage companies; material changes in the performance requirements for marketing funding support or our inability to meet such requirements; decreases from historic levels of advertising, marketing and product innovation spending by The Coca‑Cola Company and other beverage companies, or advertising campaigns that are negatively perceived by the public; any failure of the several Coca‑Cola system governance entities of which we are a participant to function efficiently or on our best behalf and any failure or delay of ours to receive anticipated benefits from these governance entities; provisions in our beverage distribution and manufacturing agreements with The Coca‑Cola Company that could delay or prevent a change in control of us or a sale of our Coca‑Cola distribution or manufacturing businesses; the concentration of our capital stock ownership; our inability to meet requirements under our beverage distribution and manufacturing agreements; changes in the inputs used to calculate our acquisition related contingent consideration liability; technology failures or cyberattacks on our information technology systems or our effective response to technology failures or cyberattacks on our customers’, suppliers’ or other third parties’ information technology systems; unfavorable changes in the general economy; the concentration risks among our customers and suppliers; lower than expected net pricing of our products resulting from continued and increased customer and competitor consolidations and marketplace competition; the effect of changes in our level of debt, borrowing costs and credit ratings on our access to capital and credit markets, operating flexibility and ability to obtain additional financing to fund future needs; the failure to attract, train and retain qualified employees while controlling labor costs, and other labor issues; the failure to maintain productive relationships with our employees covered by collective bargaining agreements, including failing to renegotiate collective bargaining agreements; changes in accounting standards; our use of estimates and assumptions; changes in tax laws, disagreements with tax authorities or additional tax liabilities; changes in legal contingencies; natural disasters, changing weather patterns and unfavorable weather; climate change or legislative or regulatory responses to such change; and the impact of any pandemic or public health situation. These and other factors are discussed in the Company’s regulatory filings with the United States Securities and Exchange Commission, including those in “Item 1A. Risk Factors” of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023. The forward-looking statements contained in this news release speak only as of this date, and the Company does not assume any obligation to update them, except as may be required by applicable law.

Results for the first nine months of 2023 include one additional selling day compared to the first nine months of 2024.  For comparison purposes, the estimated impact of the additional selling day in the first nine months of 2023 has been excluded from our comparable^(b) volume results.

Source: Coca-Cola Consolidated, Inc.