Delaware (State or other jurisdiction of incorporation) | 001-02217 (Commission File Number) | 58-0628465 (IRS Employer Identification No.) |
One Coca-Cola Plaza Atlanta, Georgia (Address of principal executive offices) | 30313 (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Exhibit No. | Description |
Exhibit 99.1 | Press Release of The Coca-Cola Company, dated April 17, 2012, reporting The Coca-Cola Company's financial results for the first quarter 2012. |
THE COCA-COLA COMPANY (REGISTRANT) | ||
Date: April 17, 2012 | By: | /s/ Kathy N. Waller |
Kathy N. Waller Vice President and Controller |
Exhibit No. | Description |
Exhibit 99.1 | Press Release of The Coca-Cola Company, dated April 17, 2012, reporting The Coca-Cola Company's financial results for the first quarter 2012. |
Contacts: Investors and Analysts: Jackson Kelly T +01 404.676.7563 Media: Kent Landers T +01 404.676.2683 | The Coca-Cola Company Global Public Affairs & Communications Department P.O. Box 1734 Atlanta, GA 30301 |
• | Strong global volume growth of 5% in the quarter, with growth across every geographic operating group. North America volume grew 2% and international volume grew 6% in the quarter. |
• | First quarter reported net revenues grew 6% and comparable currency neutral net revenues grew 7%, driven by solid price/mix of 3%. |
• | First quarter reported operating income grew 10%. Comparable currency neutral operating income grew 5% in the quarter. After adjusting for the 3% impact due to cycling lower commodity costs in the prior year period, our comparable currency neutral operating income grew 8% in the first quarter. |
• | First quarter reported and comparable EPS of $0.89. |
• | First quarter cash from operations up 8%. Excluding incremental pension contributions, cash from operations increased 13%. |
• | Productivity and reinvestment program with incremental annualized savings of $550 to $650 million by the end of 2015 is on track. |
Three Months Ended March 30, 2012 | |||||
% Favorable / (Unfavorable) | |||||
Unit Case Volume | Net Revenues | Operating Income | Comparable Currency Neutral Operating Income | ||
Total Company | 5 | 6 | 10 | 5 | |
Eurasia & Africa | 9 | 4 | 12 | 19 | |
Europe | 1 | (2) | (3) | (2) | |
Latin America | 5 | 3 | 4 | 11 | |
North America | 2 | 5 | (3) | (9) | |
Pacific | 8 | 12 | 29 | 5 | |
Bottling Investments | 11 | 10 | 351 | — |
• | Our Eurasia and Africa Group's volume grew 9% in the quarter, cycling 8% growth in the prior year quarter, led by strong volume growth in India, up 20%, the Middle East and North Africa, up 14%, South Africa, up 10% and Russia, up 3%. Reported net revenues for the quarter increased 4%, reflecting an 11% increase in concentrate sales and positive price/mix of 1%, partially offset by an 8% currency impact. Concentrate sales in the quarter were slightly ahead of unit case volume as we cycled lower shipments in the prior year quarter. Reported operating income increased 12% in the quarter. Comparable currency neutral operating income increased 19% in the quarter, driven by the increase in net revenues and favorable operating expense leverage, despite the impact of higher cost of goods sold and increased investments in the business. |
• | In Eurasia and Africa, sparkling beverage volume grew 8% in the quarter, led by brand |
• | Our Europe Group's volume grew 1% in the quarter, cycling 1% growth in the prior year quarter, underscoring our system's ability to manage through mixed macroeconomic conditions across the region. Volume growth in the quarter was driven by 6% growth in Spain, 3% growth in Germany and 1% growth in Central and Southern Europe. Northwest Europe and Nordics volume declined 1% in the quarter, impacted by unseasonably cold weather and competitive activities in the quarter, but with improvement in the second half of the quarter. Reported net revenues declined 2% in the quarter, reflecting a 3% decline in concentrate sales and a 2% unfavorable currency impact, partially offset by positive price/mix of 3%. Comparable currency neutral net revenues were even in the quarter. Concentrate sales in the quarter lagged unit case sales due in part to the effect of one less selling day in the current year quarter. Reported operating income declined 3% in the quarter. Comparable currency neutral operating income declined 2% in the quarter, reflecting even net revenue growth as a result of positive pricing and product mix, offset by incremental investments related to this year's Olympic Games and Euro Cup competition. |
• | During the quarter, the Europe Group grew share in total NARTD and sparkling beverages as well as volume and value share in juices and juice drinks, energy drinks and ready-to-drink tea. Sparkling beverage volume for the group grew 1% in the quarter, driven by brand Coca-Cola, up 2%, and Coca-Cola Zero, up 13%. We leveraged integrated marketing campaigns centered on the upcoming 2012 Olympic Games and Torch Relay, brought to market innovations like Sprite sweetened with stevia in France and PlantBottle™ packaging for Coca-Cola, as well as continued our dual focus on recruitment and affordability with entry packs like the mini-can in Germany and the 375ml PET bottle in Great Britain. |
• | Our Latin America Group's volume grew 5% in the quarter, cycling 7% growth in the prior year quarter. Volume growth in the quarter was broad-based, with 9% growth in both the South Latin and Latin Center Regions (Latin Center up 7% excluding acquired brands), 4% growth in Brazil and 3% growth in Mexico, all driven by the continued dual focus on affordability with refillable packages, and recruitment through growth in immediate consumption and continued placement of new cold drink equipment. Reported net revenues for the quarter increased 3%, reflecting concentrate sales growth of 3% and positive price/mix of 6%, partially offset by a currency impact of 6%. Concentrate sales in the quarter |
• | Latin America sparkling beverage volume grew 4% in the quarter, driven by continued growth of brand Coca-Cola, up 4% in the quarter and led by 3% growth in Mexico and 11% growth in Argentina. Sprite volume was up 6% and Fanta volume was up 4% in the quarter. Still beverage volume grew 11% in the quarter, driven by packaged water, juices and juice drinks, sports drinks and ready-to-drink tea. Excluding acquired brands, still beverage volume grew 9% in the quarter. During the quarter, the Latin America Group gained volume share in total NARTD beverages, driven by volume and value share gains in still beverages and volume share gains in sparkling beverages. Sparkling beverage value share was even in the quarter. Mexico posted volume and value share growth in the quarter in both total NARTD and still beverages, while maintaining volume share and growing value share in sparkling beverages. Brazil's continued focus on balanced growth in both single-serve and returnable packaging resulted in volume and value share gains in total NARTD beverages as well as in sparkling and still beverages. |
• | Our North America Group's volume grew 2% in the quarter, with volume and value share gains in total NARTD beverages. Reported net revenues for the quarter increased 5%, reflecting “as reported” volume growth of 1%, which includes the effect of one less selling day in the current year quarter, as well as positive price/mix of 3% and a 1% benefit from structural change, primarily related to the acquisition of Great Plains Coca-Cola Bottling Company. First quarter reported operating income declined 3%. Comparable currency neutral operating income declined 9% in the quarter due to the cycling of lower commodity costs in the prior year period as well as the effect of one less selling day in the current year quarter, which also unfavorably impacted operating expense leverage in the quarter. These factors merely reflect timing versus the prior year and they were previously contemplated in the Company's internal planning process and were communicated externally throughout the quarter. |
• | Sparkling beverage volume grew 1% in the quarter, with brand Coca-Cola volume also positive, driven by strong brand programming around the Super Bowl and American Idol as |
• | North America still beverage volume grew 6% in the quarter, led by continued strong Powerade growth of 13% with the new “Power Through” campaign and NCAA March Madness activation. Still beverage volume in the quarter also benefited from double-digit growth in Dasani water in PlantBottle™ packaging, Gold Peak tea, vitaminwater zero and smartwater. During the quarter, we gained volume and value share in still beverages, with volume and value share gains across multiple still beverage categories, including juices and juice drinks, sports drinks, energy drinks and ready-to-drink tea. |
• | Our Pacific Group's volume growth of 8% was broad-based in the quarter, with 9% growth in China, 3% growth in Japan, 24% growth in Thailand and 6% growth in the Philippines. The group's volume growth was driven by 6% growth in sparkling beverages, led by 6% growth in brand Coca-Cola, and 11% growth in still beverages. Concentrate sales in the quarter lagged unit case sales as a result of one less selling day in the current year quarter as well as timing of shipments. Reported net revenues for the quarter grew 12%, reflecting 5% concentrate sales growth, a 4% currency benefit, positive price/mix of 1% and the impact of cycling prior year one-time items related to the natural disasters in Japan. Reported operating income increased 29% in the quarter as we cycled the prior year one-time items in Japan. In addition, reported operating income reflects a 6% currency benefit and improved mix as our business in Japan continues to recover from the disruptions in the prior year quarter. Comparable currency neutral operating income increased 5% in the quarter. |
• | China volume grew 9% in the quarter as we continued to be impacted by resizing to smaller packages. Importantly, these right-sizing efforts are generating strong incremental transactions, which increased 15% in the quarter. Sparkling beverage volume grew 4% in the quarter, with solid growth of 5% for brand Coca-Cola, 4% for Sprite and 15% for Fanta. Sparkling beverage transactions were up double digits in the quarter, driven by the expansion of our 300ml PET bottle. This led to the realization of both volume and value share gains in the sparkling beverage category. Still beverage volume grew 16% in the quarter, with share gains for juices and juice drinks even as the overall category slowed. |
• | During the quarter, the Japan Business Unit was recognized with the Company's highest honor, the 2011 Woodruff Cup, based on the business unit's achievement of key performance metrics as set forth in the Company's 2020 Vision. In the quarter, Japan's sparkling beverage volume grew 3%, with brand Coca-Cola up 2% and Fanta up 6% as we continued to leverage global brand campaigns and integrated promotions like “Coke and Meals”. Single-serve I LOHAS water volume grew 4% in the quarter, driving continued volume and value share gains in the packaged water category while cycling strong water volume sales in the aftermath of the natural disasters in March 2011. Georgia coffee volume grew 3% in the quarter, driving volume and value share gains in ready-to-drink coffee with good performance in the important convenience store and vending machine channels. Ayataka green tea continued its strong performance in the quarter, with positive volume momentum across all channels. |
• | Our Bottling Investments Group's volume grew 11% in the quarter on an average daily sales basis, reflecting growth in China, India, Germany and the Philippines. Reported net revenue for the quarter grew 10%. This reflects “as reported” volume growth of 8% and positive price/mix of 3%, primarily driven by positive pricing partially offset by geographic mix, and a 1% positive impact due to structural change. Currency had a 2% unfavorable impact on reported net revenues. Reported operating income in the quarter increased 351%, reflecting the cycling of prior year restructuring initiatives, partially offset by the impact of structural change and currency. Comparable currency neutral operating income was even in the quarter, reflecting the increase in revenues resulting from volume growth, positive pricing and product mix, offset by higher commodity costs and continued investments in our in-market capabilities as well as the impact of one less selling day in the current year quarter. |
• | All references to growth rate percentages, share and cycling of growth rates compare the results of the period to those of the prior year comparable period. |
• | “Concentrate sales” represents the amount of concentrates, syrups, beverage bases and powders sold by, or used in finished beverages sold by, the Company to its bottling partners or other customers. |
• | “Sparkling beverages” means NARTD beverages with carbonation, including energy drinks and carbonated waters and flavored waters. |
• | “Still beverages” means nonalcoholic beverages without carbonation, including noncarbonated waters, flavored waters and enhanced waters, juices and juice drinks, teas, coffees, sports drinks and noncarbonated energy drinks. |
• | All references to volume and volume percentage changes indicate unit case volume, except for the reference to “as reported” volume in North America and Bottling Investments Group. All volume percentage changes, unless otherwise noted, are computed based on average daily sales. “Unit case” means a unit of measurement equal to 24 eight-ounce servings of finished beverage. “Unit case volume” means the number of unit cases (or unit case equivalents) of Company beverages directly or indirectly sold by the Company and its bottling partners to customers. |
• | For both North America and Bottling Investments Group, net revenue growth attributable to volume reflects the increase in “as reported” volume, which is based on as reported sales rather than average daily sales. North America's “as reported” volume represents |
• | First quarter 2012 financial results were impacted by one less selling day, and fourth quarter 2012 financial results will be impacted by two additional selling days. Unit case volume results are not impacted by the variance in selling days due to the average daily sales computation referenced above. |
• | Due to the refocusing in 2012 of the Beverage Partners Worldwide (BPW) ready-to-drink tea joint venture with Nestlé S.A. (Nestlé), we have eliminated the BPW joint venture volume from our reported results for both 2011 and 2012 in those countries in which the joint venture is being phased out during 2012. In addition, we eliminated the Nestea licensed volume in the U.S. due to our current U.S. license agreement with Nestlé terminating at the end of 2012. These changes did not impact the Company's reported volume results for first quarter |
• | The Company reports its financial results in accordance with accounting principles generally accepted in the United States (GAAP). However, management believes that certain non-GAAP financial measures provide users with additional meaningful financial information that should be considered when assessing our ongoing performance. Management also uses these non-GAAP financial measures in making financial, operating and planning decisions and in evaluating the Company's performance. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company's reported results prepared in accordance with GAAP. Our non-GAAP financial information does not represent a comprehensive basis of accounting. |
THE COCA-COLA COMPANY AND SUBSIDIARIES | |||||||||
Condensed Consolidated Statements of Income | |||||||||
(UNAUDITED) | |||||||||
(In millions except per share data) | |||||||||
Three Months Ended | |||||||||
March 30, 2012 | April 1, 2011 | % Change | |||||||
As Adjusted1 | |||||||||
Net Operating Revenues | $ | 11,137 | $ | 10,517 | 6 | ||||
Cost of goods sold | 4,348 | 3,948 | 10 | ||||||
Gross Profit | 6,789 | 6,569 | 3 | ||||||
Selling, general and administrative expenses | 4,181 | 4,076 | 3 | ||||||
Other operating charges | 99 | 209 | — | ||||||
Operating Income | 2,509 | 2,284 | 10 | ||||||
Interest income | 115 | 94 | 22 | ||||||
Interest expense | 88 | 113 | (22) | ||||||
Equity income (loss) — net | 140 | 134 | 4 | ||||||
Other income (loss) — net | 49 | 117 | — | ||||||
Income Before Income Taxes | 2,725 | 2,516 | 8 | ||||||
Income taxes | 658 | 600 | 10 | ||||||
Consolidated Net Income | 2,067 | 1,916 | 8 | ||||||
Less: Net income attributable to noncontrolling interests | 13 | 13 | 0 | ||||||
Net Income Attributable to Shareowners of The Coca-Cola Company | $ | 2,054 | $ | 1,903 | 8 | ||||
Diluted Net Income Per Share2 | $ | 0.89 | $ | 0.82 | 9 | ||||
Average Shares Outstanding — Diluted2 | 2,301 | 2,331 |
1 | Effective January 1, 2012, the Company elected to change our accounting methodology for determining the market-related value of assets for our U.S. qualified defined benefit pension plans. The Company's change in accounting methodology has been applied retrospectively, and we have adjusted all prior period financial information presented herein as required. |
2 | For the three months ended March 30, 2012 and April 1, 2011, "Basic Net Income Per Share" was $0.91 for 2012 and $0.83 for 2011 based on "Average Shares Outstanding — Basic" of 2,263 for 2012 and 2,292 for 2011. Basic net income per share and diluted net income per share are calculated based on net income attributable to shareowners of The Coca-Cola Company. |
THE COCA-COLA COMPANY AND SUBSIDIARIES | |||||||
Condensed Consolidated Balance Sheets | |||||||
(UNAUDITED) | |||||||
(In millions except par value) | |||||||
March 30, 2012 | April 1, 2011 | ||||||
As Adjusted1 | |||||||
ASSETS | |||||||
Current Assets | |||||||
Cash and cash equivalents | $ | 10,664 | $ | 12,803 | |||
Short-term investments | 2,476 | 1,088 | |||||
Total Cash, Cash Equivalents and Short-Term Investments | 13,140 | 13,891 | |||||
Marketable securities | 2,639 | 144 | |||||
Trade accounts receivable, less allowances of $77 and $83, respectively | 4,814 | 4,920 | |||||
Inventories | 3,442 | 3,092 | |||||
Prepaid expenses and other assets | 3,988 | 3,450 | |||||
Total Current Assets | 28,023 | 25,497 | |||||
Equity Method Investments | 7,594 | 7,233 | |||||
Other Investments, Principally Bottling Companies | 1,317 | 1,141 | |||||
Other Assets | 3,770 | 3,495 | |||||
Property, Plant and Equipment — net | 15,300 | 14,939 | |||||
Trademarks With Indefinite Lives | 6,531 | 6,430 | |||||
Bottlers' Franchise Rights With Indefinite Lives | 7,796 | 7,770 | |||||
Goodwill | 12,344 | 12,219 | |||||
Other Intangible Assets | 1,222 | 1,250 | |||||
Total Assets | $ | 83,897 | $ | 79,974 | |||
LIABILITIES AND EQUITY | |||||||
Current Liabilities | |||||||
Accounts payable and accrued expenses | $ | 9,717 | $ | 9,009 | |||
Loans and notes payable | 13,375 | 12,871 | |||||
Current maturities of long-term debt | 1,389 | 2,041 | |||||
Accrued income taxes | 365 | 362 | |||||
Total Current Liabilities | 24,846 | 24,283 | |||||
Long-Term Debt | 16,351 | 13,656 | |||||
Other Liabilities | 4,663 | 5,420 | |||||
Deferred Income Taxes | 4,819 | 4,694 | |||||
The Coca-Cola Company Shareowners' Equity | |||||||
Common stock, $0.25 par value; Authorized — 5,600 shares; Issued — 3,520 and 3,520 shares, respectively | 880 | 880 | |||||
Capital surplus | 11,557 | 11,212 | |||||
Reinvested earnings | 54,520 | 53,621 | |||||
Accumulated other comprehensive income (loss) | (1,775 | ) | (2,774 | ) | |||
Treasury stock, at cost — 1,263 and 1,257 shares, respectively | (32,364 | ) | (31,304 | ) | |||
Equity Attributable to Shareowners of The Coca-Cola Company | 32,818 | 31,635 | |||||
Equity Attributable to Noncontrolling Interests | 400 | 286 | |||||
Total Equity | 33,218 | 31,921 | |||||
Total Liabilities and Equity | $ | 83,897 | $ | 79,974 |
1 | Effective January 1, 2012, the Company elected to change our accounting methodology for determining the market-related value of assets for our U.S. qualified defined benefit pension plans. The Company's change in accounting methodology has been applied retrospectively, and we have adjusted all prior period financial information presented herein as required. |
THE COCA-COLA COMPANY AND SUBSIDIARIES | |||||||
Condensed Consolidated Statements of Cash Flows | |||||||
(UNAUDITED) | |||||||
(In millions) | |||||||
Three Months Ended | |||||||
March 30, 2012 | April 1, 2011 | ||||||
As Adjusted1 | |||||||
Operating Activities | |||||||
Consolidated net income | $ | 2,067 | $ | 1,916 | |||
Depreciation and amortization | 447 | 486 | |||||
Stock-based compensation expense | 77 | 76 | |||||
Deferred income taxes | (103 | ) | (24 | ) | |||
Equity (income) loss — net of dividends | (133 | ) | (92 | ) | |||
Foreign currency adjustments | (66 | ) | 17 | ||||
Significant (gains) losses on sales of assets — net | (14 | ) | (110 | ) | |||
Other operating charges | 63 | 232 | |||||
Other items | 1 | 15 | |||||
Net change in operating assets and liabilities | (1,846 | ) | (2,058 | ) | |||
Net cash provided by operating activities | 493 | 458 | |||||
Investing Activities | |||||||
Purchases of short-term investments | (1,900 | ) | (1,398 | ) | |||
Proceeds from disposals of short-term investments | 518 | 1,050 | |||||
Acquisitions and investments | (121 | ) | (189 | ) | |||
Purchases of other investments | (2,763 | ) | (11 | ) | |||
Proceeds from disposals of bottling companies and other investments | 49 | 395 | |||||
Purchases of property, plant and equipment | (592 | ) | (589 | ) | |||
Proceeds from disposals of property, plant and equipment | 27 | 23 | |||||
Other investing activities | (101 | ) | (328 | ) | |||
Net cash provided by (used in) investing activities | (4,883 | ) | (1,047 | ) | |||
Financing Activities | |||||||
Issuances of debt | 11,358 | 7,316 | |||||
Payments of debt | (8,835 | ) | (4,598 | ) | |||
Issuances of stock | 436 | 440 | |||||
Purchases of stock for treasury | (1,079 | ) | (1,129 | ) | |||
Dividends | — | (1,065 | ) | ||||
Other financing activities | 42 | 22 | |||||
Net cash provided by (used in) financing activities | 1,922 | 986 | |||||
Effect of Exchange Rate Changes on Cash and Cash Equivalents | 329 | 161 | |||||
Cash and Cash Equivalents | |||||||
Net increase (decrease) during the period | (2,139 | ) | 558 | ||||
Balance at beginning of period | 12,803 | 8,517 | |||||
Balance at end of period | $ | 10,664 | $ | 9,075 |
1 | Effective January 1, 2012, the Company elected to change our accounting methodology for determining the market-related value of assets for our U.S. qualified defined benefit pension plans. The Company's change in accounting methodology has been applied retrospectively, and we have adjusted all prior period financial information presented herein as required. |
THE COCA-COLA COMPANY AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||
Operating Segments | |||||||||||||||||||||||||||||||||
(UNAUDITED) | |||||||||||||||||||||||||||||||||
(In millions) | |||||||||||||||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||||
Net Operating Revenues | Operating Income (Loss)1 | Income (Loss) Before Income Taxes1 | |||||||||||||||||||||||||||||||
March 30, 2012 | April 1, 2011 | % Fav. / (Unfav.) | March 30, 2012 | April 1, 2011 | % Fav. / (Unfav.) | March 30, 2012 | April 1, 2011 | % Fav. / (Unfav.) | |||||||||||||||||||||||||
Eurasia & Africa | $ | 684 | $ | 656 | 4 | $ | 295 | $ | 265 | 12 | $ | 296 | $ | 268 | 10 | ||||||||||||||||||
Europe | 1,204 | 1,224 | (2 | ) | 695 | 714 | (3 | ) | 708 | 720 | (2 | ) | |||||||||||||||||||||
Latin America | 1,186 | 1,154 | 3 | 744 | 716 | 4 | 743 | 728 | 2 | ||||||||||||||||||||||||
North America | 4,921 | 4,687 | 5 | 451 | 464 | (3 | ) | 467 | 464 | 1 | |||||||||||||||||||||||
Pacific | 1,379 | 1,229 | 12 | 573 | 443 | 29 | 571 | 444 | 29 | ||||||||||||||||||||||||
Bottling Investments | 2,103 | 1,907 | 10 | 35 | 8 | 351 | 169 | 129 | 31 | ||||||||||||||||||||||||
Corporate | 30 | 28 | 9 | (284 | ) | (326 | ) | 13 | (229 | ) | (237 | ) | 3 | ||||||||||||||||||||
Eliminations | (370 | ) | (368 | ) | — | — | — | — | — | — | — | ||||||||||||||||||||||
Consolidated | $ | 11,137 | $ | 10,517 | 6 | $ | 2,509 | $ | 2,284 | 10 | $ | 2,725 | $ | 2,516 | 8 |
1 | Effective January 1, 2012, the Company elected to change our accounting methodology for determining the market-related value of assets for our U.S. qualified defined benefit pension plans. The Company's change in accounting methodology has been applied retrospectively, and we have adjusted all prior period financial information presented herein as required. |
• | Intersegment revenues were $34 million for Eurasia and Africa, $150 million for Europe, $59 million for Latin America, $4 million for North America, $104 million for Pacific and $19 million for Bottling Investments. |
• | Operating income (loss) and income (loss) before income taxes were reduced by $61 million for North America, $15 million for Bottling Investments and $3 million for Corporate due to charges related to the Company's productivity and reinvestment program as well as other ongoing restructuring initiatives. Operating income (loss) and income (loss) before income taxes were increased by $1 million for Europe due to the reversal of an accrual related to the Company's 2008-2011 productivity initiatives. |
• | Operating income (loss) and income (loss) before income taxes were reduced by $20 million for North America due to changes in the Company's ready-to-drink tea strategy as a result of our current U.S. license agreement with Nestlé S.A. ("Nestlé") terminating at the end of 2012. |
• | Operating income (loss) and income (loss) before income taxes were reduced by $6 million for North America due to costs associated with the Company detecting residues of carbendazim, a fungicide that is not registered in the U.S. for use on citrus products, in orange juice imported from Brazil for distribution in the U.S. As a result, the Company began purchasing additional supplies of Florida orange juice at a higher cost than Brazilian orange juice. |
• | Income (loss) before income taxes was reduced by $3 million for Corporate due to changes in the structure of Beverage Partners Worldwide ("BPW"), our 50/50 joint venture with Nestlé in the ready-to-drink tea category. |
• | Income (loss) before income taxes was increased by a net $44 million for Bottling Investments. This net increase primarily represents the Company’s proportionate share of a transaction gain recorded by an equity method investee, partially offset by our proportionate share of restructuring charges recorded by our equity method investees. |
• | Intersegment revenues were $34 million for Eurasia and Africa, $152 million for Europe, $72 million for Latin America, $3 million for North America, $88 million for Pacific and $19 million for Bottling Investments. |
• | Operating income (loss) and income (loss) before income taxes were reduced by $1 million for Eurasia and Africa, $1 million for Europe, $111 million for North America, $1 million for Pacific, $21 million for Bottling Investments and $27 million for Corporate due to the Company’s productivity, integration and restructuring initiatives. |
• | Operating income (loss) and income (loss) before income taxes were reduced by $19 million for North America due to the amortization of favorable supply contracts acquired in connection with our acquisition of CCE's former North America business. |
• | Operating income (loss) and income (loss) before income taxes were reduced by $79 million for Pacific due to charges associated with the earthquake and tsunami that devastated northern and eastern Japan on March 11, 2011. These charges were primarily related to the Company’s charitable donations in support of relief and rebuilding efforts in Japan as well as funds provided to certain bottling partners in the affected regions. |
• | Income (loss) before income taxes was increased by $102 million for Corporate due to the gain on the sale of our investment in Coca-Cola Embonor S.A. (“Embonor”), a bottling partner with operations primarily in Chile. Prior to this transaction, the Company accounted for our investment in Embonor under the equity method of accounting. |
• | Income (loss) before income taxes was reduced by $4 million for Corporate related to the premiums paid to repurchase long-term debt. |
• | Income (loss) before income taxes was reduced by $4 million for Bottling Investments, primarily attributable to the Company’s proportionate share of restructuring charges recorded by an equity method investee. |
THE COCA-COLA COMPANY AND SUBSIDIARIES |
Reconciliation of GAAP and Non-GAAP Financial Measures |
(UNAUDITED) |
THE COCA-COLA COMPANY AND SUBSIDIARIES |
Reconciliation of GAAP and Non-GAAP Financial Measures |
(UNAUDITED) |
THE COCA-COLA COMPANY AND SUBSIDIARIES |
Reconciliation of GAAP and Non-GAAP Financial Measures |
(UNAUDITED) |
THE COCA-COLA COMPANY AND SUBSIDIARIES | ||||||||||||||||||||||||||||||||
Reconciliation of GAAP and Non-GAAP Financial Measures | ||||||||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||||||||
(In millions except per share data) | ||||||||||||||||||||||||||||||||
Three Months Ended March 30, 2012 | ||||||||||||||||||||||||||||||||
Net operating revenues | Cost of goods sold | Gross profit | Gross margin | Selling, general and administrative expenses | Other operating charges | Operating income | Operating margin | |||||||||||||||||||||||||
Reported (GAAP) | $ | 11,137 | $ | 4,348 | $ | 6,789 | 61.0 | % | $ | 4,181 | $ | 99 | $ | 2,509 | 22.5 | % | ||||||||||||||||
Items Impacting Comparability: | ||||||||||||||||||||||||||||||||
Asset Impairments/Restructuring | — | — | — | — | (15 | ) | 15 | |||||||||||||||||||||||||
Productivity & Reinvestment | — | — | — | — | (64 | ) | 64 | |||||||||||||||||||||||||
Productivity Initiatives | — | — | — | — | 1 | (1 | ) | |||||||||||||||||||||||||
Equity Investees | — | — | — | — | — | — | ||||||||||||||||||||||||||
CCE Transaction | — | — | — | — | — | — | ||||||||||||||||||||||||||
Transaction Gains | — | — | — | — | — | — | ||||||||||||||||||||||||||
Certain Tax Matters | — | — | — | — | — | — | ||||||||||||||||||||||||||
Other Items | 2 | 30 | (28 | ) | 16 | (21 | ) | (23 | ) | |||||||||||||||||||||||
After Considering Items (Non-GAAP) | $ | 11,139 | $ | 4,378 | $ | 6,761 | 60.7 | % | $ | 4,197 | $ | — | $ | 2,564 | 23.0 | % | ||||||||||||||||
Three Months Ended April 1, 2011 | ||||||||||||||||||||||||||||||||
Net operating revenues | Cost of goods sold | Gross profit | Gross margin | Selling, general and administrative expenses | Other operating charges | Operating income | Operating margin | |||||||||||||||||||||||||
Reported (GAAP) — As Adjusted | $ | 10,517 | $ | 3,948 | $ | 6,569 | 62.5 | % | $ | 4,076 | $ | 209 | $ | 2,284 | 21.7 | % | ||||||||||||||||
Items Impacting Comparability: | ||||||||||||||||||||||||||||||||
Asset Impairments/Restructuring | — | — | — | — | (34 | ) | 34 | |||||||||||||||||||||||||
Productivity & Reinvestment | — | — | — | — | — | — | ||||||||||||||||||||||||||
Productivity Initiatives | — | — | — | — | (28 | ) | 28 | |||||||||||||||||||||||||
Equity Investees | — | — | — | — | — | — | ||||||||||||||||||||||||||
CCE Transaction | — | (19 | ) | 19 | — | (100 | ) | 119 | ||||||||||||||||||||||||
Transaction Gains | — | — | — | — | — | — | ||||||||||||||||||||||||||
Certain Tax Matters | — | — | — | — | — | — | ||||||||||||||||||||||||||
Other Items | 28 | 26 | 2 | 6 | (47 | ) | 43 | |||||||||||||||||||||||||
After Considering Items (Non-GAAP) | $ | 10,545 | $ | 3,955 | $ | 6,590 | 62.5 | % | $ | 4,082 | $ | — | $ | 2,508 | 23.8 | % | ||||||||||||||||
Currency Neutral: | ||||||||||||||||||||||||||||||||
Net operating revenues | Cost of goods sold | Gross profit | Selling, general and administrative expenses | Other operating charges | Operating income | |||||||||||||||||||||||||||
% Change - Reported (GAAP) | 6 | 10 | 3 | 3 | — | 10 | ||||||||||||||||||||||||||
% Currency Impact | (1) | (1) | (2) | (1) | — | (3) | ||||||||||||||||||||||||||
% Change - Currency Neutral Reported | 7 | 11 | 5 | 4 | — | 12 | ||||||||||||||||||||||||||
% Change - After Considering Items (Non-GAAP) | 6 | 11 | 3 | 3 | — | 2 | ||||||||||||||||||||||||||
% Currency Impact After Considering Items (Non-GAAP) | (1) | (1) | (2) | (1) | — | (2) | ||||||||||||||||||||||||||
% Change - Currency Neutral After Considering Items (Non-GAAP) | 7 | 11 | 4 | 4 | — | 5 |
THE COCA-COLA COMPANY AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||||||
Reconciliation of GAAP and Non-GAAP Financial Measures | |||||||||||||||||||||||||||||||||||||
(UNAUDITED) | |||||||||||||||||||||||||||||||||||||
(In millions except per share data) | |||||||||||||||||||||||||||||||||||||
Three Months Ended March 30, 2012 | |||||||||||||||||||||||||||||||||||||
Interest expense | Equity income (loss) — net | Other income (loss) — net | Income before income taxes | Income taxes | Effective tax rate | Net income attributable to noncontrolling interests | Net income attributable to shareowners of The Coca-Cola Company | Diluted net income per share1 | |||||||||||||||||||||||||||||
Reported (GAAP) | $ | 88 | $ | 140 | $ | 49 | $ | 2,725 | $ | 658 | 24.1 | % | $ | 13 | $ | 2,054 | $ | 0.89 | |||||||||||||||||||
Items Impacting Comparability: | |||||||||||||||||||||||||||||||||||||
Asset Impairments/Restructuring | — | — | — | 15 | — | — | 15 | 0.01 | |||||||||||||||||||||||||||||
Productivity & Reinvestment | — | — | — | 64 | 24 | — | 40 | 0.02 | |||||||||||||||||||||||||||||
Productivity Initiatives | — | — | — | (1 | ) | — | — | (1 | ) | — | |||||||||||||||||||||||||||
Equity Investees | — | (44 | ) | — | (44 | ) | (4 | ) | — | (40 | ) | (0.02 | ) | ||||||||||||||||||||||||
CCE Transaction | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||
Transaction Gains | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||
Certain Tax Matters | — | — | — | — | 8 | — | (8 | ) | — | ||||||||||||||||||||||||||||
Other Items | — | 3 | — | (20 | ) | (7 | ) | (1 | ) | (12 | ) | (0.01 | ) | ||||||||||||||||||||||||
After Considering Items (Non-GAAP) | $ | 88 | $ | 99 | $ | 49 | $ | 2,739 | $ | 679 | 24.8 | % | $ | 12 | $ | 2,048 | $ | 0.89 | |||||||||||||||||||
Three Months Ended April 1, 2011 | |||||||||||||||||||||||||||||||||||||
Interest expense | Equity income (loss) — net | Other income (loss) — net | Income before income taxes | Income taxes | Effective tax rate | Net income attributable to noncontrolling interests | Net income attributable to shareowners of The Coca-Cola Company | Diluted net income per share2 | |||||||||||||||||||||||||||||
Reported (GAAP) — As Adjusted | $ | 113 | $ | 134 | $ | 117 | $ | 2,516 | $ | 600 | 23.8 | % | $ | 13 | $ | 1,903 | $ | 0.82 | |||||||||||||||||||
Items Impacting Comparability: | |||||||||||||||||||||||||||||||||||||
Asset Impairments/Restructuring | — | — | — | 34 | 5 | — | 29 | 0.01 | |||||||||||||||||||||||||||||
Productivity & Reinvestment | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||
Productivity Initiatives | — | — | — | 28 | 9 | — | 19 | 0.01 | |||||||||||||||||||||||||||||
Equity Investees | — | 4 | — | 4 | 1 | — | 3 | — | |||||||||||||||||||||||||||||
CCE Transaction | — | — | — | 119 | 45 | — | 74 | 0.03 | |||||||||||||||||||||||||||||
Transaction Gains | — | — | (102 | ) | (102 | ) | (36 | ) | — | (66 | ) | (0.03 | ) | ||||||||||||||||||||||||
Certain Tax Matters | — | — | — | — | (3 | ) | — | 3 | — | ||||||||||||||||||||||||||||
Other Items | (4 | ) | — | — | 47 | 15 | — | 32 | 0.01 | ||||||||||||||||||||||||||||
After Considering Items (Non-GAAP) | $ | 109 | $ | 138 | $ | 15 | $ | 2,646 | $ | 636 | 24.0 | % | $ | 13 | $ | 1,997 | $ | 0.86 | |||||||||||||||||||
Interest expense | Equity income (loss) — net | Other income (loss) — net | Income before income taxes | Income taxes | Net income attributable to noncontrolling interests | Net income attributable to shareowners of The Coca-Cola Company | Diluted net income per share | ||||||||||||||||||||||||||||||
% Change - Reported (GAAP) | (22) | 4 | — | 8 | 10 | — | 8 | 9 | |||||||||||||||||||||||||||||
% Change - After Considering Items (Non-GAAP) | (19) | (28) | — | 4 | 7 | (8) | 3 | 3 |
1 | 2,301 million average shares outstanding - diluted |
2 | 2,331 million average shares outstanding - diluted |
THE COCA-COLA COMPANY AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||
Reconciliation of GAAP and Non-GAAP Financial Measures | |||||||||||||||||||||||||||||||||
(UNAUDITED) | |||||||||||||||||||||||||||||||||
(In millions) | |||||||||||||||||||||||||||||||||
Operating Income (Loss) by Segment: | |||||||||||||||||||||||||||||||||
Three Months Ended March 30, 2012 | |||||||||||||||||||||||||||||||||
Eurasia & Africa | Europe | Latin America | North America | Pacific | Bottling Investments | Corporate | Consolidated | ||||||||||||||||||||||||||
Reported (GAAP) | $ | 295 | $ | 695 | $ | 744 | $ | 451 | $ | 573 | $ | 35 | $ | (284 | ) | $ | 2,509 | ||||||||||||||||
Items Impacting Comparability: | |||||||||||||||||||||||||||||||||
Asset Impairments/Restructuring | — | — | — | — | — | 15 | — | 15 | |||||||||||||||||||||||||
Productivity & Reinvestment | — | — | — | 61 | — | — | 3 | 64 | |||||||||||||||||||||||||
Productivity Initiatives | — | (1 | ) | — | — | — | — | — | (1 | ) | |||||||||||||||||||||||
CCE Transaction | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Transaction Gains | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Other Items | — | — | — | (5 | ) | — | (20 | ) | 2 | (23 | ) | ||||||||||||||||||||||
After Considering Items (Non-GAAP) | $ | 295 | $ | 694 | $ | 744 | $ | 507 | $ | 573 | $ | 30 | $ | (279 | ) | $ | 2,564 | ||||||||||||||||
Three Months Ended April 1, 2011 | |||||||||||||||||||||||||||||||||
Eurasia & Africa | Europe | Latin America | North America | Pacific | Bottling Investments | Corporate | Consolidated | ||||||||||||||||||||||||||
Reported (GAAP) — As Adjusted | $ | 265 | $ | 714 | $ | 716 | $ | 464 | $ | 443 | $ | 8 | $ | (326 | ) | $ | 2,284 | ||||||||||||||||
Items Impacting Comparability: | |||||||||||||||||||||||||||||||||
Asset Impairments/Restructuring | 1 | — | — | 11 | — | 21 | 1 | 34 | |||||||||||||||||||||||||
Productivity & Reinvestment | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Productivity Initiatives | — | 1 | — | — | 1 | — | 26 | 28 | |||||||||||||||||||||||||
CCE Transaction | — | — | — | 119 | — | — | — | 119 | |||||||||||||||||||||||||
Transaction Gains | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Other Items | — | — | — | (37 | ) | 79 | 3 | (2 | ) | 43 | |||||||||||||||||||||||
After Considering Items (Non-GAAP) | $ | 266 | $ | 715 | $ | 716 | $ | 557 | $ | 523 | $ | 32 | $ | (301 | ) | $ | 2,508 | ||||||||||||||||
Currency Neutral Operating Income (Loss) by Segment: | |||||||||||||||||||||||||||||||||
Eurasia & Africa | Europe | Latin America | North America | Pacific | Bottling Investments | Corporate | Consolidated | ||||||||||||||||||||||||||
% Change - Reported (GAAP) | 12 | (3) | 4 | (3) | 29 | 351 | 13 | 10 | |||||||||||||||||||||||||
% Currency Impact | (8) | (1) | (7) | — | 6 | (20) | (2) | (3) | |||||||||||||||||||||||||
% Change - Currency Neutral Reported | 20 | (2) | 11 | (3) | 23 | 372 | 15 | 12 | |||||||||||||||||||||||||
% Change - After Considering Items (Non-GAAP) | 11 | (3) | 4 | (9) | 10 | (7) | 7 | 2 | |||||||||||||||||||||||||
% Currency Impact After Considering Items (Non-GAAP) | (8) | (1) | (7) | — | 5 | (7) | (2) | (2) | |||||||||||||||||||||||||
% Change - Currency Neutral After Considering Items (Non-GAAP) | 19 | (2) | 11 | (9) | 5 | — | 9 | 5 |
Note: | Certain columns may not add due to rounding. Certain growth rates may not recalculate using the rounded dollar amounts provided. |
THE COCA-COLA COMPANY AND SUBSIDIARIES | |||||||||||||
Reconciliation of GAAP and Non-GAAP Financial Measures | |||||||||||||
(UNAUDITED) | |||||||||||||
(In millions) | |||||||||||||
Bottling Investments Segment Information: | |||||||||||||
Three Months Ended March 30, 2012 | |||||||||||||
Net operating revenues | Selling, general and administrative expenses | Operating income | |||||||||||
Reported (GAAP) | $ | 2,103 | $ | 677 | $ | 35 | |||||||
Items Impacting Comparability: | |||||||||||||
Asset Impairments/Restructuring | — | — | 15 | ||||||||||
Other Items | — | — | (20 | ) | |||||||||
After Considering Items (Non-GAAP) | $ | 2,103 | $ | 677 | $ | 30 | |||||||
Three Months Ended April 1, 2011 | |||||||||||||
Net operating revenues | Selling, general and administrative expenses | Operating income | |||||||||||
Reported (GAAP) — As Adjusted | $ | 1,907 | $ | 624 | $ | 8 | |||||||
Items Impacting Comparability: | |||||||||||||
Asset Impairments/Restructuring | — | — | 21 | ||||||||||
Other Items | — | — | 3 | ||||||||||
After Considering Items (Non-GAAP) | $ | 1,907 | $ | 624 | $ | 32 | |||||||
Currency Neutral and Structural for Bottling Investments: | |||||||||||||
Net operating revenues | Selling, general and administrative expenses | Operating income | |||||||||||
% Change - Reported (GAAP) | 10 | 8 | 351 | ||||||||||
% Currency Impact | (2) | (3) | (20) | ||||||||||
% Change - Currency Neutral Reported | 13 | 11 | 372 | ||||||||||
% Change - Structural Impact | 1 | 1 | (17) | ||||||||||
% Change - Currency Neutral Reported and Adjusted for Structural Items | 12 | 10 | 389 | ||||||||||
% Change - After Considering Items (Non-GAAP) | 10 | 8 | (7) | ||||||||||
% Currency Impact After Considering Items (Non-GAAP) | (2) | (3) | (7) | ||||||||||
% Change - Currency Neutral After Considering Items (Non-GAAP) | 13 | 11 | — | ||||||||||
% Structural Impact After Considering Items (Non-GAAP) | 1 | 1 | (4) | ||||||||||
% Change - Currency Neutral After Considering Items and Adjusted for Structural Items (Non-GAAP) | 12 | 10 | 4 |
Note: | Certain columns may not add due to rounding. Certain growth rates may not recalculate using the rounded dollar amounts provided. |
THE COCA-COLA COMPANY AND SUBSIDIARIES | ||||||||||
Reconciliation of GAAP and Non-GAAP Financial Measures | ||||||||||
(UNAUDITED) | ||||||||||
(In millions) | ||||||||||
Purchases and Issuances of Stock: | ||||||||||
Three Months Ended March 30, 2012 | Three Months Ended April 1, 2011 | |||||||||
Reported (GAAP): | ||||||||||
Issuances of Stock | $ | 436 | $ | 440 | ||||||
Purchases of Stock for Treasury | (1,079 | ) | (1,129 | ) | ||||||
Net Change in Stock Issuance Receivables1 | 122 | 56 | ||||||||
Net Change in Treasury Stock Payables2 | (324 | ) | 84 | |||||||
Net Treasury Share Repurchases (Non-GAAP) | $ | (845 | ) | $ | (549 | ) |
1 | Represents the net change in receivables related to employee stock options exercised but not settled prior to the end of the quarter. |
2 | Represents the net change in payables for treasury shares repurchased but not settled prior to the end of the quarter. |
Consolidated Cash from Operations: | ||||||||||
Three Months Ended March 30, 2012 | Three Months Ended April 1, 2011 | |||||||||
Net Cash Provided by Operating Activities | Net Cash Provided by Operating Activities | |||||||||
Reported (GAAP) | $ | 493 | $ | 458 | ||||||
Items Impacting Comparability: | ||||||||||
Cash Payments Related to Pension Plan Contributions | 900 | 769 | ||||||||
After Considering Items (Non-GAAP) | $ | 1,393 | $ | 1,227 | ||||||
Net Cash Provided by Operating Activities | ||||||||||
% Change - Reported (GAAP) | 8 | |||||||||
% Change - After Considering Items (Non-GAAP) | 13 |
THE COCA-COLA COMPANY AND SUBSIDIARIES | |||||
Reconciliation of GAAP and Non-GAAP Financial Measures | |||||
(UNAUDITED) | |||||
(In millions) | |||||
Consolidated Operating Income: | |||||
Three Months Ended March 30, 2012 | |||||
Reported (GAAP) | $ | 2,509 | |||
Items Impacting Comparability: | |||||
Asset Impairments/Restructuring | 15 | ||||
Productivity & Reinvestment | 64 | ||||
Productivity Initiatives | (1 | ) | |||
CCE Transaction | — | ||||
Other Items | (23 | ) | |||
After Considering Items (Non-GAAP) | $ | 2,564 | |||
Three Months Ended April 1, 2011 | |||||
Reported (GAAP) — As Adjusted | $ | 2,284 | |||
Items Impacting Comparability: | |||||
Asset Impairments/Restructuring | 34 | ||||
Productivity & Reinvestment | — | ||||
Productivity Initiatives | 28 | ||||
CCE Transaction | 119 | ||||
Other Items | 43 | ||||
After Considering Items (Non-GAAP) | $ | 2,508 | |||
Currency Neutral and Commodity Impact on Operating Income: | |||||
% Change - Reported (GAAP) | 10 | ||||
% Currency Impact | (3) | ||||
% Change - Currency Neutral Reported | 12 | ||||
% Change - Commodities Impact | (3) | ||||
% Change - Currency Neutral Reported and Adjusted for Commodities | 16 | ||||
% Change - After Considering Items (Non-GAAP) | 2 | ||||
% Currency Impact After Considering Items (Non-GAAP) | (2) | ||||
% Change - Currency Neutral After Considering Items (Non-GAAP) | 5 | ||||
% Commodities Impact After Considering Items (Non-GAAP) | (3) | ||||
% Change - Currency Neutral After Considering Items and Adjusted for Commodities (Non-GAAP) | 8 |
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