Coke Not Worried by School Sales Policy

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Coca-Cola Co. (KO) said Wednesday that it does not expect new industry restrictions on sales of soft drinks in U.S. schools to have a significant impact on its business.

Coca-Cola, PepsiCo Inc. (PEP) and other beverage makers announced this week a set of voluntary guidelines calling for the removal of all soft drinks from elementary schools and sugared soft drinks from middle schools during school hours.

The move followed pressure from nutritionists and parents who have linked the consumption of sugary sweet drinks to obesity in children and teenagers. Some critics have called for tobacco-style warning labels on sodas.

"Our volume in schools is small," said Dan Schafer, a spokesman for Coca-Coca. He added that the world's largest soft drink maker expects more of its healthier drinks, including bottled waters, to be sold in schools under the new policy.

"The fastest-growing products we have in school vending machines are Dasani bottled water and Powerade sports drinks," Schafer said.

The Coke system as well and those of its rivals, however, have not committed to a complete reversal of their school marketing programs.

Soft drinks will still be available in high schools throughout the day and in middle schools after the end of classes each day. There are no restrictions on sales of diet soft drinks, except in elementary schools.

In addition, it may take several years for the new soda restrictions — which were developed by the American Beverage Association (search), an industry group that includes Coca-Cola and PepsiCo — to be implemented across the board.

That is because the new policies do not generally apply to existing contracts between beverage companies and schools.

The industry's determination to continue selling soda under certain conditions in many schools drew fire from the Center for Science in the Public Interest (search), a harsh critic of soft drink companies.

"The industry surely hopes this voluntary half-step will forestall efforts to get soda out of all schools," said Margo Wootan, nutrition policy director of the Washington-based group.

"But we hope that Congress, states and school systems act to ensure that schools sell only healthful drinks and snacks to all children," Wootan said.

Shares of Coca-Cola were off 3 cents to $43.27 on the New York Stock Exchange. PepsiCo was up 1 cents to $54.80 on the NYSE.