Cost-cutting measures create healthy Coca-Cola profit

Despite lower turnover, drink manufacturer Coca-Cola managed to generate a higher profit in 2015, compared to the year before, partially because of its cost-cutting program designed by CEO Muhtar Kent. 

Cost-cutting measures will continue

Coca-Cola’s 2015 turnover dropped 4 % to 44.3 billion dollars (39.5 billion euro), partly because of the stronger dollar, which meant that foreign sales generated less. 

Price hikes and a cost-cutting program did result in a higher profit for Coca-Cola, namely 7.4 billion dollars (6.6 billion euro), up 3.6 % compared to last year. 

Its fourth quarter turnover also dropped, but less than before. Analysts had predicted a 9.9 billion dollar (8.8 billion euro) turnover, but it ended up being 10 billion dollars (8.9 billion euro), while fourth quarter profit grew from 770 million dollars (684 million euro) to 1.24 billion dollars (1.1 billion euro).

Despite the positive advances, CEO Muhtar Kent is not planning to halt his cost-cutting measures. He aims to cut 3 billion dollars in costs every year, while all North American bottling plants should be sold to franchise holders by 2017. For 2016, Coca-Cola expects a 4 to 6 % turnover and profit growth.