Coca-Cola expects the company to return to growth in its core revenue this year after a harsh year 2020, and believes that the application of the vaccine around the world will encourage consumers to return to the cinemas and sporting events that represent the bulk of its sales.
The company relies on sales lines to non-retailers to generate more than a third of its sales, but the pandemic crisis has restricted the restaurant business and forced the cancellation of many events and kept a large percentage of consumers at home, resulting in a 9% decline in the company’s core sales last year.
The company expects to grow its adjusted earnings in 2021 from a high single to a low double (approximately 7-14%), while its core revenue will rise by a percentage of a high singleton.
But Coca-Cola has also warned that it expects to be liable for potential $12 billion in expenses in its dispute with the US Internal Revenue Service over the amount of fees it charges its foreign affiliates for the rights to produce and sell Coca-Cola products abroad.
The company described that the US tax court “misunderstood and applied” the regulatory measures in its conclusions in November and will “appeal and vigorously defend its position“.
Coca-Cola reported just $438 million in tax reserves last year, and according to the trading market, Coca-Cola shares rose 1% after beating expectations by five cents to 47 cents per share in the fourth quarter.