Anti-war Boycott Costs Coca Cola Billions

national | miscellaneous | news report Thursday April 17, 2003 07:09 by el trensado

The anti-war boycott of Coca Cola corporation has resulted in disappointing sales results that cost the company billions of dollars of shareholder value today.

2003-04-16

The anti-war boycott of Coca Cola corporation has resulted in
disappointing sales results that cost the company billions of dollars
of shareholder value today.

In Coca Cola's first quarter report issued today, the corporation
--which symbolizes U.S. global economic dominance--reported
disappointing sales that did not meet the company's aggressive
growth targets. Especially noteworthy was the 10% drop in sales
reported for anti-war Germany where a popular boycott movement
has lead to the removal of Coca Cola from the menus of many
popular restaurants.

The sales report led to a flight of capital from Coca Cola stocks that
dropped the stock price by more than 6% resulting in a $6.5 billion
loss in company market capitalization.

The $6.5 billion dollars is small but significant loss compared to the
hundreds of billions in net profit that the U.S. will get from control
of Iraqi oil. But it is a first step in decreasing global economic
inequality and making the gas-guzzling U.S. economy pay for its
war of aggression.

The excessive consumption of the U.S. economy relative to the rest
of the world is supported by a net flow of capital to the U.S. that is
drawn by multinational corporate profits. Decreased profitability of
U.S. multinationals frees up investment funds to be invested in
developing other, more needy parts of the global economy.

By boycotting large U.S. multinationals around the world, anti-war
activists hope to both send a message, and to redress some of the
damage produced by the U.S. military oil grab.

Even though the main-stream media ignores the impact and
effectiveness of the international anti-war boycott movement,
investors are keeping an eye on how popular outrage regarding the
war may affect the bottom line of well-know U.S. multinationals.
In business-speak: investors have "concerns that anti-American
sentiment will depress international business."

REFERENCES

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Business - AP

Investors Dump Coca-Cola Co. Shares
Wed Apr 16, 4:32 PM ET

By HARRY R. WEBER, AP Business Writer

ATLANTA - Investors ignored Coca-Cola's solid first-quarter earnings
Wednesday, dumping shares amid concerns about weak sales at home and
prospects for the company's business abroad.

...

Analysts said investors are increasingly worried about the company's ability to
sustain sales in its largest market, North America, combined with concerns that
anti-American sentiment will depress its international business.

"International concerns weigh on management," said Todd Stender, an analyst
with Crowell, Weedon and Co. in Los Angeles. "Couple that with talk of boycotts
overseas really makes people anxious. These are still lingering issues."

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Business - Reuters

Coke Posts Profit; Weak Sales Hurt Shares
Wed Apr 16, 4:40 PM ET

By Paul Simao

ATLANTA (Reuters)

Soft drink giant Coca-Cola Co. (NYSE:KO - news) ...
reported weaker-than-expected sales in North America and many other markets,
sending its shares down by more than 6 percent.

...

German volumes dropped 10 percent in the quarter.

Morgan Stanley analyst William Pecoriello cited Coca-Cola's difficulties in
Germany as one factor in his decision to cut his forecast for underlying volume
growth in 2003 to 3.6 percent from 4.1 percent.

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South Asia - AFP
Coca Cola, Pepsi sales fall after anti-war boycott call in India
Tue Apr 8, 7:50 AM ET

A call for a boycott of American and
British goods by an anti-war forum has led to the sales of
Coca Cola and Pepsi plummeting in the southern Indian state
of Kerala, distributors have said.

...

"Our sales have been hit by more than 50 percent in the last one week. There has
been very little demand for fresh stocks," said another distributor, who said he
feared his Coca Cola license would be cancelled if he revealed his name.

He said shopkeepers feared a backlash from the activists if they sold
the colas.

"The boycott call seems to have frightened the retailers. They feel that if
Coca-Cola bottles are stocked in their shops after the deadline the left-wing
outfits in Kerala may storm the shops causing huge losses," the distributor
said.

Shop owners in the state capital Trivandrum said some customers were
demanding substitute soft drinks.
...
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