Coca-Cola gets fizz back as sales decline slows

Coca-Cola reassured investors it is getting its fizz back on Tuesday, as the company steadied its decline and beat analysts’ forecasts with its first quarter results.

Profits at the drinks giant fell 8pc to $1.62bn, whilst revenues slipped 4pc to $10.58bn. However, the slowdown was not as bad as feared, after a surge in sales in China and Russia.

The company does not break out revenues for those countries, but said that the volume of drinks sold in China rose by 12pc, helped by heavy advertising around Chinese New Year. A marketing blitz around the Sochi Winter Olympics also helped fuel a 9pc increase in volume sales in Russia.

Its performance in developing markets helped to offset a 4pc drop in Europe, where customers are losing their appetite for high-sugar, fizzy drinks. Sales in America, which have been in decline for the last few quarters, started to plateau.

"We're beginning to get our momentum back here the beginning of 2014," Muhtar Kent, chairman and chief executive of the company told investors. “All of us at The Coca-Cola Company remain confident in our ability to deliver on our strategies while further strengthening our foundation for profitable and sustainable long-term growth.”

Coca-Cola and other drinks manufacturers have suffered in developed markets, as more consumers swap carbonated drinks for healthier options. The drinks industry has spent the past decade trying to offset that trend by introducing more low and zero-calorie versions of its beverages, but many consumers are now trying to cut back on those as well.

However, Coca-Cola said falling US sales had steadied, as the company took more market shares from competitors. "Our North America Group delivered even volume versus the prior year quarter while gaining value share and maintaining volume share,” it said.

Shares in the company rose 3pc in morning trading in New York, as investors digested the brighter outlook.