Coke Profits up 10%; Protests Held Outside Hotel
Activists Accuse Company of Labor Abuse Practices
ATLANTA - The Coca-Cola Co.'s nearly two-year restructuring to put
legal problems in the past, improve employee morale and stabilize
the world's largest beverage maker around a common vision is complete,
Chief Executive Neville Isdell told shareholders Wednesday as the
company reported a 10 percent increase in first-quarter profit on
"We're well on our way to becoming the company you expect us to be,"
Isdell said during the company's annual meeting at a hotel in Wilmington,
While he was speaking, about 50 demonstrators, including college students,
Teamsters and activists, protested outside.
Activist critics have accused the Atlanta-based company of labor abuses
in Colombia and environmental abuses in India, despite the company's
aggressive public relations campaign to counter the claims.
Isdell said he welcomed the discussion, but urged those who disagree
with the company's practices to be civil.
"Not everyone in this room is going to agree with everyone's views,"
But he said almost everyone wants the same thing.
"We want our economies to grow. We want living standards to increase.
We want The Coca-Cola Co. to be the best employer everywhere in the
world that it operates," he said.
He added, "We want healthy, active consumers. We want to protect our
planet and preserve our resources. In the end, we truly want The Coca-Cola
Co. to be regarded as a great business and recognized as a great corporate
The company's earnings narrowly beat Wall Street expectations.
Coke said it earned $1.11 billion, or 47 cents a share, for the three
months ending March 31, compared to a profit of $1 billion, or 42
cents a share, for the same period a year ago.
Excluding one-time items, Coke said it earned $1.16 billion, or 49
cents a share, in the three-month period. That was ahead of the 48
cents a share analysts surveyed by Thomson Financial were expecting
it to earn in the quarter.
Revenue in the January-March period was $5.23 billion versus $5.21
billion a year ago.
Coke said unit case volume increased 5 percent companywide in the
quarter, led by strong growth in China, Russia and Turkey. The company
said it also had a solid quarter in North America and Latin America.
Offsetting these results were unit case volume declines in the Philippines,
India and Africa.
The company said it saw growth in its carbonated beverage, water,
sports drink and juice brands.
Outside the annual meeting in Delaware, one of the protesters, Michael
Gould-Wartofsky, a 21-year-old Harvard student from New York City,
said Coke needs to be more accountable to its consumers and investors.
Holding a pair of drumsticks and beating on a plastic barrel on a
sling across his shoulder, he said he also wants the company to be
more accountable to the schools where it does business.
Others used bullhorns to make noise.
Teamster member Peter Rovetto, 52, of Jonas, Pa., who said he worked
as a merchandiser for Coke in New Jersey, said the company needs to
treat its employees better.
"Workers are underpaid and overworked and often pressured into working
overtime," he said.
Activists were offering a tapwater challenge to passers-by to demonstrate
that Coke's Dasani bottled water product tastes no better than municipal
tap water but is much more expensive.
At the meeting, which was broadcast on the Web, shareholders voted
to re-elect all of the board members to another one-year term, except
for billionaire investor Warren Buffett, who decided not to seek re-election
after 17 years as a Coke director.
Also Wednesday, Coke reiterated that it has made changes to its operating
structure to create a new, separate internal organization for its
unconsolidated bottling investments.
Coca-Cola shares rose 39 cents to close at $41.69 on the New York
Stock Exchange. They have traded in a 52-week range of $39.36 to $45.26.
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