Coca-Cola reports lower profit, U.S. bottler deal

Coca-Cola Co reported a slightly higher-than-expected quarterly profit on Tuesday and announced a deal to unload some distribution territory to five independent U.S. bottlers, sending its shares up nearly 3 percent in premarket trading.

The transaction by the maker of Sprite, Fanta and Minute Maid is not a surprise, but comes earlier than expected.

Coke bought the North American operations of bottler Coca-Cola Enterprises Inc in October 2010, following a similar move by PepsiCo Inc aimed at cutting costs and streamlining innovation and decision-making.

Coke Chief Executive Muhtar Kent said at the time that he still believed in the so-called franchise model - where Coke sells syrup to independent bottlers who package and distribute the drinks - and that the company would eventually return to it. The company had laid out a timeline of three to five years.

As for performance, the world's largest soft-drink maker said first-quarter net income was $1.75 billion, or 39 cents per share, down from $2.05 billion, or 45 cents per share, a year earlier.

Excluding one-time items, earnings were 46 cents per share, topping analysts' average estimate of 45 cents, according to Thomson Reuters I/B/E/S.

Revenue slipped 1 percent to $11.04 billion.

The five bottlers involved in the deal are Coca-Cola Bottling Co Consolidated, Coca-Cola Bottling Co United Inc, Swire Coca-Cola USA, Coca-Cola Bottling Co High Country and Corinth Coca-Cola Bottling Works Inc.

Financial terms were not disclosed.

Coke's shares were up 2.9 percent at $41.25 in premarket New York Stock Exchange trading.