miércoles, 22 de febrero de 2017

Sodastream recalls 'exploding' bottles

Sodastream recalls 'exploding' bottles

Soft drinks company Sodastream has recalled thousands of its bottles over concerns they could explode when used.

The company said it had discovered a manufacturing defect with one type of bottle that meant it could burst when pressurised.

About 59,000 bottles sold in the US and Canada were affected by the recall.

Sodastream said it had not received any reports of injuries related to the defective bottles, but had urged customers to return them for a refund.

The company sells devices that use pressurised carbon dioxide canisters and reusable plastic bottles to turn still water in to sparkling water.

The recall affected blue-tinted one-litre bottles marked dishwasher safe, with a blue plastic cap and bottom, with an expiry date of "04/2020".

ImageThe recall affects one type of reusable bottle

The bottles were sold in shops and online between February 2016 and January 2017.

Sodastream told the BBC that the affected bottles had never been sold in the UK and it had recalled the products voluntarily.

"SodaStream is producing millions of carbonation bottles every year and is committed to providing its consumers all around the world with an outstanding record for safety and quality," it said.

Coca-Cola in recycling U-turn as firm backs Scottish drinks bottle return scheme

The fizzy drink manufacturer previously strongly opposed the idea, arguing that it could negatively impact its business

The Independent Online

Coca-Cola said it remains fully committed to finding new ways to minimise the materials it uses and reduce wasteJustin Sullivan/Getty Images

Coca-Cola has thrown its supports behind a deposit return scheme for drinks bottles inScotland, in an effort to reduce littering and boost recycling that represents a major policy shift for the company.

The deposit return scheme (DRS) is designed to encourage consumers to return their drinks bottles by adding a small refundable charge at sale. The DRS system has already been shown to raise collection rates in Germany, Sweden and Denmark, according to environment campaigners, and is being considered by other countries including Scotland.

The fizzy drink manufacturer previously strongly opposed the idea, arguing that it could negatively impact its business.

However, in a major u-turn for the company, Coca-Cola UK announced it is now supporting the DRS scheme in Scotland.

In a statement sent to the Independent, Coca-Cola UK said : “We have embarked on a major review of our sustainable packaging strategy to understand what role we can play in unlocking the full potential of a circular economy in Great Britain.

“Our sustainable packaging review is ongoing, but it’s already clear from our conversations with experts that the time is right to trial new interventions such as a well-designed deposit return scheme for drinks containers, starting in Scotland where conversations are underway,” the company added.

Coca-Cola said it remains fully committed to finding new ways to minimise the materials it uses, reduce waste and work with other stakeholders to improve recycling rates across Britain.

Louise Edge, senior oceans campaigner at Greenpeace UK, said: “Deposit schemes, which have growing support amongst the public, politicians and industry, can play a key role in reducing the amount of plastic which ends up in our oceans and in landfill.

“Companies like Coca-Cola must have ambitious plans for 100 per cent recycled content and move away from the era of single-use, disposable, plastic. Only by these companies taking responsibility for the end life of the bottles they sell, will we close the loop on the 16 million plastic bottles which are dumped every day in the UK, and go on to pollute our beaches, land and sea.”

Up to 12 million tonnes of plastic ends up in the sea every year, according to Greenpeace.

According to Recycle Now, the national recycling campaign for England, which is funded by the Government, UK households use an average of 480 plastic bottles a year, but recycle just 270 of them.

This means that of the 35 million plastic bottles being used every day, around 16 million are not recycled, and the use of plastic bottles is still growing.

Earlier this month, the Government said it was considering bringing in additional charges for buying plastic bottles in a bid to tackle the quantity of waste taking up space in landfill sites and polluting the sea.

martes, 21 de febrero de 2017

Revenue Compression At Coca Cola - Jump In For Income?

A dividend aristocrat with a high yield is undergoing a massive business transformation.

Persisting currency and structural headwinds limit the company's ability to grow.

What's in store for dividend investors jumping in now?

Stock of The Coca-Cola Company (NYSE:KO) hasn't had a great year so far with its almost flat performance lacking behind that of the broad S&P 500 (SPY; ~+4%). The company is currently undergoing a massive business transformation in terms of refranchising its bottling operations and concentrating on the company's core strengths. Accompanying its latest Q4/2016 earnings release the company, a dividend aristocrat, has raised its dividend by 5.7% and thus extended its 54-years long dividend growth streak. The stock is now yielding about 3.5% and thus generates plenty of income for dividend investors. Shall investors jump in now?

What is going on at Coca Cola?

Source: Coca Cole Website

Coca Cola's financial metrics in terms of revenue, net income and EPS were in line with expectations (revenue actually beat by a fraction). The company reported Q4 adjusted EPS of $0.37 and revenue of $9.41B which is down 5.9% Y/Y. While revenue only showed a 6% decline the company's net income plummeted by more than 50%. Two main drivers, unfavorable currency developments and headwinds from structural changes were negatively weighing on KO's profitability.

Combined these two drivers had a negative impact on revenue of -12% and thus, despite a strong 6% organic growth for Q4, revenues were clearly down compared to Q4/2015. What's more, in Coca Cola's flagship North America market net revenue grew by 8% and by the same amount in Asia Pacific whereas it fell by 4% in Latin America and EMEA.

The sharp drop in income (-56%; -$687M) is primarily driven by incurred losses of $799M related to derecognizing intangible assets within Coca Cola's refranchising activities.

However, for various reasons the fourth quarter is not comparable to Q4/2015 (e.g. the company recorded a big negative in Asia Pacific in 2015 which disappeared in 2016 and thus led to a big positive) and thus not suitable to gauge how we should think about KO's success.

Instead, let's take a look at full-year 2016 to assess how KO is moving on with its transformation and how its future business could look like.

To benefit from global fitness and health trends and also combat the effects of partially imposed and proposed sugary drinks taxes in the US and UK (more countries may follow), the Coca Cola Company is investing a lot of resources to help consumers in reducing consumption of added sugars. At the center of this activity is Coca Cola Zero Sugar which recorded very strong unit sales growth, particularly in Q4, as it expanded into France, Belgium, Netherlands and Ireland with more countries planned to be included in 2017. With this product pushing into more and more markets growth is expected to accelerate in the coming years and thus help limit the impact of soda taxes.

Investors should be eying the performance and progress of Coca Cola Zero Sugar very closely as it gives important clues as to how such products may counter the negative effects of above-mentioned soda taxes. So far the product is very well received and shows consistent and rising double-digit growth rates.

How is Coca Cola transforming its business?

In their recent Q4 earnings presentation, the company included a slide which best summarizes their strategic refranchising efforts.

Put in a nutshell, KO wants to concentrate on what it does best, which is marketing and exploring new products (keyword: driving the consumer-centric portfolio) and not spend resources on bottling operations. This should allow for higher gross and operating margins and more efficient cash flows resulting from a leaner business.

This is a massive business transformation for the company as it means that around 50% of the company's business is in motion. Against that backdrop a clean 4% organic core growth realized in 2016 is already very promising, particularly as the company cannot fully concentrate on its new core business as long as that transformation process has not been completed.

In terms of progress the company expects this business transformation to be completed somewhere in 2018. Already in 2016 KO reached agreement with its bottlers in China and completed the setup of Coca-Cola European partners. In its flagship North America market the company expects finishing the refranchising by the end of this year.

What's in store for dividend investors?

Despite the company's illustrious dividend track record which has earned itself the status of a dividend aristocrat (55 increases in 54 consecutive years) its dividend growth has slowed down markedly over the last years:

  •  2013: +9.8%

  •  2014: +8.9%

  •  2015: +8.2%

  •  2016: +6.1%

  •  2017: +5.7%

So, while the latest dividend raise is significantly smaller than what the company recorded three years ago, it is still beating inflation by a wide margin. However, with declining revenues on the one hand and rising dividends on the other, Coca Cola's financial leeway for future increases has significantly contracted.

Both measured in terms of EPS and free cash flow the company's dividend payout ratio has almost reached full coverage (~92%). Thus, either way we look at it, future dividend growth potential at this stage seems to be limited, at least if the company wants to fund this with its operating business performance.

Still, dividend investors can count on KO to increase its dividend every year, although the magnitude of these increases will likely be limited to a maximum of only $0.01 per share (possibly even less). As the company's long-term prospects start materializing dividend growth for the new Coca Cola company will pick up.

Regarding long-term prospects KO's guidance for 2017 calls for another year of earnings repression as structural and currency headwinds will continue to weigh on the business (-8-10% impact on profit after tax). Another negative driver will be a higher underlying effective tax rate, 24% instead of 22.5%.

This picture is not expected to change in 2018 with the company's initial 2018 considerations showing that further unfavorable developments regarding its tax rate and foreign currency as well as headwinds on revenue from acquisitions, divestitures and structural items will persist.

Take Away

Over the last decades the company has shown its strong commitment to shareholders. In 2016 alone it returned $6B in dividends to shareholders. The company owns one of the world's most valuable brands (#3).

However, investors in Coca Cola need to be patient. Patient for its business transformation to complete. Patient for its revenues to return to growth. And patient for its dividend growth to accelerate again. In the meantime an attractive and reliable dividend income will compensate for the waiting time. Using the Dividend Calendar Tool (check out the link for more information) I can easily extract that KO goes ex-dividend on March 13, 2017. Boasting a current yield of 3.5% it is a great long-term income play.

The journey ahead is not without obstacles but investors believing in the company in the long run and its current business transformation makes the company a strong case for long-term dividend investors.

What do you think? Do you believe in KO's business transformation and its long-term growth prospects? Are you a buyer now?

Author's note: If you like this article and want to read more, please click the "Follow" button on top of the page.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

lunes, 20 de febrero de 2017

Cost of a sugar hit

Lisa Holley was so addicted to Coca-Cola that when she gave it up her liver and kidneys went into shock.

The 23-year-old had gone from downing more than a litre a day to having nothing, and afterwards she had trouble eating for months, losing up to 20 kilograms.

But the cravings soon returned, and she started drinking it once again, unable to shake her addiction. "I feel lacksey-daisy until I have my morning Coke, and then I can find my bouncing bubbly self," Lisa said.

"One time I came home from work and hadn't had any all day to find somebody had drunk my Coke and it sent me into a full mental breakdown. I was balling my eyes out and screaming, I needed my Coke fix."

Lisa's Coca-Cola addiction goes back to when she started working at a bar when she was 18. She said she has been hooked ever since, save for the six-month break in 2013, when she suffered severe weight loss.

Shunning coffee and tea, she has her first Coca-Cola at 10am and it sometimes affects her sleep as she never goes to bed before midnight.

But Lisa wants to overcome her addiction, and is grateful her parents are always on her back about it.

"I would absolutely love that," she said.

"I'm so worried about my teeth.

"I don't think I could just do it on my own. I live on Coca-Cola and soft drink, I really do."

MPs not sold on new tax scheme

But Farrer MP Sussan Ley has slammed a proposed sugar levy as a tax on the poor, arguing emphasis should be placed on education to combat the Border's obesity epidemic.

The former Health Minister, speaking in one of her first interviews since resigning amid a travel expenses scandal last month, said if a so-called sugar tax was slapped on soft drinks it would hit poorer families hardest, with research showing they are more likely to drink unhealthy products.

Farrer MP Sussan Ley.

Melbourne-based think tank the Grattan Institute had called on the government to introduce a tax of 40 cents per 100 grams of sugar on all non-alcoholic, water-based drinks in a report released in November.

In other words, the tax would raise the price of a can of soft drink by around 15 cents and a two-litre bottle by about 80 cents.

But Ms Ley said this would be an onerous burden on families with less money. "If they still buy the soft drink, that's less money for them to spend on something nutritious for their families ... it doesn't take too much to see this, in some ways, as a tax on the poor, and that's what I don't like about it," she said.

"It appears to be a simple answer to a complex problem but I'm not convinced it would work, and I think we have to be much more multi-thronged in our approach to tackle obesity."

Government money should be put towards education programs explaining to people how unhealthy soft drinks are - akin to anti-smoking campaigns of the last two decades, Ms Ley said.

The debate in Australia comes as Britain decided it would introduce a sugar tax from 2018 that will be limited to soft drinks.

Ms Ley stopped short of saying Australia should throw out the idea altogether, and said the government ought to watch what happens in Britain.

Indi MP Cathy McGowan agreed that a focus on education programs exposing the dangers of sugar should take precedence, and said the last thing Australia's tax system needed was another add on.

"At the end of the day, there's definitely a role for government in changing peoples attitudes, but given a choice between an education program and a tax, I'd choose an education program," she said.

Indi MP Cathy McGowan

"For example, the 'Life. Be In It' program was hugely successful in changing peoples attitudes towards exercise."

Ms McGowan, who is a former president of lobby group Australian Women in Agriculture, said the government needed to take into account any unintended consequences of a new tax on Australia's sugar industry, which is largely based in Queensland.

Ms McGowan said it was not an issue of class.

Extent of sugar addiction revealed

Benalla and Wangaratta residents rank among the worst in Victoria when it comes to soft drink consumption, the latest Victorian Population Health Survey has shown.

The report found a startling one in five residents in both cities down a drink of soft drink every day.

Soft drinks are often sold in 600ml bottles, which means people are consuming up to 16 teaspoons of sugar in each large sugary drink they swallow. 

In response, the Australian Guide to Healthy Eating has recommended people should limit intake of soft drinks to "only sometimes and in small amounts".

But these warnings have not been heeded by many in the North East.

It found around one in nine Victorian adults - the equivalent of about 650,000 people - drink sugary drinks every day, and one in two Victorian adults are overweight or obese.

Wodonga fared slightly better, with only one in 10 people drinking soft drinks every day.

However, this has not improved the belt lines of residents.

The report found 56.3 per cent of Wodonga residents are overweight, putting them at greater risk of diabetes, stroke and heart disease.

It's not much better north of the Border, with 59.4 residents registering as overweight or obese in the Murrumbidgee Local Health District, which takes in Albury and much of the Riverina.

The authority's health promotion co-ordinator, Brendan Pearson, said people did not realise how much sugar was in soft drinks.

"One can of soft drink a day can lead to six-and-a-half kilos of weight gain in a year," he said.

Real sugar and tropical flavors give Mexican sodas their refreshing powers

Real sugar and tropical flavors give Mexican sodas their refreshing powers · Gateways To Drinkery · The A.V. Club

Welcome to Gateways To Drinkery, where The A.V. Club offers an entry-level course on our favorite libations, and some suggestions on where to start drinking them.

Mexican sodas

The lowdown: The original soft drinks of Mexico were aguas frescas ("fresh waters"), popularized when Aztec farmers mashed fresh fruit into water to refresh themselves on long journeys. These non-alcoholic drinks - flavored with flowers, grains, fruits, and seeds native to Mexico - are every bit as popular today, sloshing in translucent containers at taquerias stands.

But Mexicans today have taken to a popular American tradition: carbonated sodas (a genre of beverages that has reverse migrated, in recent years, back into United States - just ask your friendly neighborhood hipster restaurant for a Mexican Coke). While usual suspects Coca-Cola and 7 Up are mainstays in Mexican beverage culture, sodas south of the border have their own unique quirks and singular traits, drawing tropical inspiration from traditional drinks served in Mexico for millennia.

The taste: Mexican culinary tradition places a greater emphasis on the use of unrefined sugar; cane syrup is boiled down and poured into molds shaped like cones and flat round cakes, then sold as panela, piloncillo, or panocha. Allowing molasses and trace elements to remain in the sugar gives a deeper, caramelized complexity to dishes like flan; try to spot these same flavors in Mexican soda, which often use real cane sugar rather than high fructose corn syrup.

Tropical fruits, by virtue of their abundance, play a greater role in Mexican soft drinks. Pineapple and mango are two favorites. Guava is particularly popular, used in the irresistibly bubblegum-colored Jarritos guava soda. Despite its shocking pink, guava is a subtle fruit with similarities to persimmon and a flavor more floral than acidic or sweet.

Possible gateway: Why not begin with Mexican versions of the classics? Check the label of imported glass bottles of Coca-Cola, Squirt, and Sprite to make sure you're getting the "hecho en Mexico" version with real cane sugar, which rounds off Coke's usual metallic sharp bite with caramel warmth.

From there, you can explore flavors that you won't find at your local burger joint's fountain. Jamaica soda, widely available in both glass and plastic bottles from Jarritos, is made from hibiscus flower; the deep red pigment comes from anthocyanin, a flavor molecule that contributes to the slightly astringent flavor and faint notes of over-steeped black tea. This flavor is notable for being one of the closest to a traditional agua de jamaica, which is tart, slightly syrupy, and sure to stain your white T-shirt if you dare to spill it. The carbonated version rounds off some of the mouth-puckering effect with effervescence and the magic of artificial flavoring.

Tamarind is a popular flavor globally, surfacing in Southeast Asian chutneys and Middle Eastern stews; the sticky brown fruit contained in its leathery pod is used to flavor Latin America candies as well as sodas, becoming less tart and more fruity when mixed with sugar. Jarritos tamarind soda is more complex and earthy than most American sodas, rich with notes of pomegranate molasses and dried fruit, and evocative of memories of diving under piñatas to snatch at tamarind pulp candies.

Next steps: The U.S. Hispanic population is rapidly growing, gaining buying power at a pace faster than the general population and outspending other households on trips to the grocery store. As a result, many supermarkets now carry a wide variety of Latin American products. But the limited shelf space is often reserved for major brands, and you're unlikely to find rare delights such as Champagne cola, a caramel-colored cream soda that found its way to Mexico via the Caribbean Islands. If your area hosts businesses that cater to Latino customers (such as a mercado), the chilled cases within will likely contain more exotic beverages.

Peñafiel makes a number of soft drinks; the most popular is the Limónada, a mineral water based limeade with a delightful effervescence and a strong artificial citrus flavor reminiscent of powdered lemon-flavored drinks like Country Time.

PepsiCo's Manzanita Sol line focuses on distinctly Mexican flavors, with a flagship soda that contributes to the fact that apple is the second most popular soft drink flavor in Mexico. Sidral Mundet is another popular apple soda brand; its Manzana Verde variety boasts a crisp, tart green apple flavor.

Mexican culture has a long history of fermented drinks. Pulque, a cloudy beer-like beverage, feeds lactobacillus yeast on sugars from a wide variety of fruits and plants. While a pulqueria in Mexico City might flavor its concoctions with passion fruit or watermelon, the most popular recipe is based on the same maguey plant that gives us mezcal and tequila.

Bottled pulque exists in both alcoholic and non-alcoholic versions, but the Mexican infatuation with fermented flavors doesn't stop there - even if they won't get you tipsy. Tepachito is a fruity and fizzy cider based on the traditional recipe for tepache, a pineapple-cinnamon drink brewed in barrels.

Also rich with the taste of brown sugar is Malta, a carbonated beverage brewed from barley and hops - just like beer, but without the booze. Malta Goya is the most ubiquitous umbrella brand. The large product line includes Clásica Malta Goya, which is made with real cane sugar; try it with a slug of condensed milk, cream, or non-dairy milk for a frothy sweet creamy drink that tastes similar to a stout float.

For those who prefer wine to beer, Sangria Señorial is a sparkling non-alcoholic sangria with an authentic whiff of heady wine in the nose. Try soaking cut fruit in Sangria Señorial and serving over ice to accommodate non-alcoholic-drinkers at a summer barbecue.

Talk like an expert: "Dame cuatro tacos de cabeza con cilantro y cebolla y un jarrito de tamarindo y otro de mandarín pa' tomar." ("Give me four cabeza tacos with cilantro and onion, and a tamarind jarrito and another mandarin one to drink.")

viernes, 17 de febrero de 2017

Coca-Cola Co. files patents for new bottle designs

Coca-Cola received a design patent on this bottle on Dec. 6, 2016.

There's no more iconic American product than Coca-Cola, and there's no more iconic product packaging than the Coca-Cola bottle.

But while the iconic Coke bottle is recognized around the world, The Coca-Cola Co. (NYSE: KO) is constantly creating new bottle designs. Check out the adjacent slideshow to see a dozen new bottle designs that Coca-Cola patented during 2016.

martes, 14 de febrero de 2017

Collectors club hosts Las Vegas swap meet celebrating all things Coca-Cola - PHOTOS

Fans of "The Real Thing" got a chance to peruse thousands of Coca-Cola-related collectibles during a Las Vegas swap meet sponsored by the Coca-Cola Collectors Club on Saturday.
The event, held at Palace Station, was part of the club's 39th annual Great Get Together convention. The swap meet also gave the public an opportunity to a chance to learn more about the history of the soda brand, now in its 131st year.

Members of the club, a nonprofit organization not sponsored by the soft drink company, came from nine states, as well as Canada, Mexico and Japan, to take part in the two-day convention that began Friday, organizers said.