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Delaware
(State or other jurisdiction of
incorporation or organization)
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58-0628465
(I.R.S. Employer
Identification No.)
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One Coca-Cola Plaza
Atlanta, Georgia
(Address of principal executive offices)
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30313
(Zip Code)
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Large accelerated filer
ý
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Accelerated filer
o
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Non-accelerated filer
o
(Do not check if a smaller reporting company)
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Smaller reporting company
o
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Emerging growth company
o
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If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
o
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Class of Common Stock
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Outstanding as of July 24, 2017
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$0.25 Par Value
|
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4,265,304,181 Shares
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Page Number
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Item 1.
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||
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Condensed Consolidated Statements of Income
Three and six months ended June 30, 2017 and July 1, 2016 |
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Condensed Consolidated Statements of Comprehensive Income
Three and six months ended June 30, 2017 and July 1, 2016 |
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Condensed Consolidated Balance Sheets
June 30, 2017 and December 31, 2016 |
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Condensed Consolidated Statements of Cash Flows
Six months ended June 30, 2017 and July 1, 2016 |
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Item 2.
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Item 3.
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Item 4.
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Item 1.
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Item 1A.
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Item 2.
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Item 6.
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Three Months Ended
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Six Months Ended
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||||||||||
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June 30,
2017 |
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July 1,
2016 |
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June 30,
2017 |
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July 1,
2016 |
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||||
NET OPERATING REVENUES
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$
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9,702
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$
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11,539
|
|
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$
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18,820
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$
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21,821
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Cost of goods sold
|
3,659
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4,471
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7,172
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8,540
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||||
GROSS PROFIT
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6,043
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7,068
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11,648
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13,281
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||||
Selling, general and administrative expenses
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3,142
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3,912
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6,457
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7,673
|
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||||
Other operating charges
|
823
|
|
297
|
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1,131
|
|
608
|
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||||
OPERATING INCOME
|
2,078
|
|
2,859
|
|
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4,060
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5,000
|
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||||
Interest income
|
165
|
|
164
|
|
|
320
|
|
308
|
|
||||
Interest expense
|
231
|
|
162
|
|
|
423
|
|
303
|
|
||||
Equity income (loss) — net
|
409
|
|
305
|
|
|
525
|
|
397
|
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||||
Other income (loss) — net
|
203
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1,133
|
|
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(351
|
)
|
791
|
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||||
INCOME BEFORE INCOME TAXES
|
2,624
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4,299
|
|
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4,131
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6,193
|
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||||
Income taxes
|
1,252
|
|
839
|
|
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1,575
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|
1,240
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CONSOLIDATED NET INCOME
|
1,372
|
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3,460
|
|
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2,556
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4,953
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||||
Less: Net income (loss) attributable to noncontrolling interests
|
1
|
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12
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3
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22
|
|
||||
NET INCOME ATTRIBUTABLE TO SHAREOWNERS OF
THE COCA-COLA COMPANY
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$
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1,371
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$
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3,448
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$
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2,553
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$
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4,931
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BASIC NET INCOME PER SHARE
1
|
$
|
0.32
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$
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0.80
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$
|
0.60
|
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$
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1.14
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DILUTED NET INCOME PER SHARE
1
|
$
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0.32
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$
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0.79
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|
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$
|
0.59
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$
|
1.13
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DIVIDENDS PER SHARE
|
$
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0.37
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$
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0.35
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$
|
0.74
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$
|
0.70
|
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AVERAGE SHARES OUTSTANDING
|
4,273
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4,323
|
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4,280
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4,325
|
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||||
Effect of dilutive securities
|
54
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|
54
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50
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54
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||||
AVERAGE SHARES OUTSTANDING ASSUMING DILUTION
|
4,327
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4,377
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4,330
|
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4,379
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Three Months Ended
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Six Months Ended
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||||||||||
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June 30,
2017 |
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July 1,
2016 |
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June 30,
2017 |
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July 1,
2016 |
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||||
CONSOLIDATED NET INCOME
|
$
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1,372
|
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$
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3,460
|
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$
|
2,556
|
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$
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4,953
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Other comprehensive income:
|
|
|
|
|
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||||||||
Net foreign currency translation adjustment
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(103
|
)
|
606
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818
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|
329
|
|
||||
Net gain (loss) on derivatives
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(177
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)
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(138
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)
|
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(298
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)
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(565
|
)
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||||
Net unrealized gain (loss) on available-for-sale securities
|
5
|
|
109
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|
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164
|
|
161
|
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||||
Net change in pension and other benefit liabilities
|
(8
|
)
|
58
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|
|
33
|
|
89
|
|
||||
TOTAL COMPREHENSIVE INCOME (LOSS)
|
1,089
|
|
4,095
|
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3,273
|
|
4,967
|
|
||||
Less: Comprehensive income (loss) attributable to noncontrolling interests
|
1
|
|
11
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4
|
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15
|
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||||
TOTAL COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO SHAREOWNERS OF THE COCA-COLA COMPANY
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$
|
1,088
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$
|
4,084
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$
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3,269
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$
|
4,952
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June 30,
2017 |
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December 31,
2016 |
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ASSETS
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||||
CURRENT ASSETS
|
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||||
Cash and cash equivalents
|
$
|
11,718
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$
|
8,555
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Short-term investments
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11,016
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9,595
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TOTAL CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS
|
22,734
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18,150
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||
Marketable securities
|
4,490
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4,051
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||
Trade accounts receivable, less allowances of $473 and $466, respectively
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4,024
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3,856
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Inventories
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2,790
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2,675
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||
Prepaid expenses and other assets
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2,866
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2,481
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Assets held for sale
|
2,057
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2,797
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TOTAL CURRENT ASSETS
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38,961
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34,010
|
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EQUITY METHOD INVESTMENTS
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20,845
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16,260
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OTHER INVESTMENTS
|
1,158
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|
989
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||
OTHER ASSETS
|
4,318
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4,248
|
|
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PROPERTY, PLANT AND EQUIPMENT, less accumulated depreciation of
$10,441 and $10,621, respectively
|
8,672
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10,635
|
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TRADEMARKS WITH INDEFINITE LIVES
|
6,527
|
|
6,097
|
|
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BOTTLERS' FRANCHISE RIGHTS WITH INDEFINITE LIVES
|
772
|
|
3,676
|
|
||
GOODWILL
|
9,449
|
|
10,629
|
|
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OTHER INTANGIBLE ASSETS
|
444
|
|
726
|
|
||
TOTAL ASSETS
|
$
|
91,146
|
|
$
|
87,270
|
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LIABILITIES AND EQUITY
|
|
|
||||
CURRENT LIABILITIES
|
|
|
||||
Accounts payable and accrued expenses
|
$
|
10,363
|
|
$
|
9,490
|
|
Loans and notes payable
|
14,355
|
|
12,498
|
|
||
Current maturities of long-term debt
|
3,478
|
|
3,527
|
|
||
Accrued income taxes
|
351
|
|
307
|
|
||
Liabilities held for sale
|
283
|
|
710
|
|
||
TOTAL CURRENT LIABILITIES
|
28,830
|
|
26,532
|
|
||
LONG-TERM DEBT
|
31,805
|
|
29,684
|
|
||
OTHER LIABILITIES
|
4,092
|
|
4,081
|
|
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DEFERRED INCOME TAXES
|
4,330
|
|
3,753
|
|
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THE COCA-COLA COMPANY SHAREOWNERS' EQUITY
|
|
|
||||
Common stock, $0.25 par value; Authorized — 11,200 shares;
Issued — 7,040 and 7,040 shares, respectively
|
1,760
|
|
1,760
|
|
||
Capital surplus
|
15,473
|
|
14,993
|
|
||
Reinvested earnings
|
64,890
|
|
65,502
|
|
||
Accumulated other comprehensive income (loss)
|
(10,489
|
)
|
(11,205
|
)
|
||
Treasury stock, at cost — 2,772 and 2,752 shares, respectively
|
(49,633
|
)
|
(47,988
|
)
|
||
EQUITY ATTRIBUTABLE TO SHAREOWNERS OF THE COCA-COLA COMPANY
|
22,001
|
|
23,062
|
|
||
EQUITY ATTRIBUTABLE TO NONCONTROLLING INTERESTS
|
88
|
|
158
|
|
||
TOTAL EQUITY
|
22,089
|
|
23,220
|
|
||
TOTAL LIABILITIES AND EQUITY
|
$
|
91,146
|
|
$
|
87,270
|
|
|
Six Months Ended
|
|||||
|
June 30,
2017 |
|
July 1,
2016 |
|
||
OPERATING ACTIVITIES
|
|
|
||||
Consolidated net income
|
$
|
2,556
|
|
$
|
4,953
|
|
Depreciation and amortization
|
629
|
|
903
|
|
||
Stock-based compensation expense
|
114
|
|
119
|
|
||
Deferred income taxes
|
620
|
|
(178
|
)
|
||
Equity (income) loss — net of dividends
|
(303
|
)
|
(224
|
)
|
||
Foreign currency adjustments
|
33
|
|
118
|
|
||
Significant (gains) losses on sales of assets — net
|
259
|
|
(762
|
)
|
||
Other operating charges
|
970
|
|
210
|
|
||
Other items
|
(68
|
)
|
(125
|
)
|
||
Net change in operating assets and liabilities
|
(1,419
|
)
|
(1,194
|
)
|
||
Net cash provided by operating activities
|
3,391
|
|
3,820
|
|
||
INVESTING ACTIVITIES
|
|
|
||||
Purchases of investments
|
(10,047
|
)
|
(9,045
|
)
|
||
Proceeds from disposals of investments
|
8,337
|
|
9,518
|
|
||
Acquisitions of businesses, equity method investments and nonmarketable securities
|
(520
|
)
|
(723
|
)
|
||
Proceeds from disposals of businesses, equity method investments and nonmarketable securities
|
2,055
|
|
420
|
|
||
Purchases of property, plant and equipment
|
(832
|
)
|
(1,085
|
)
|
||
Proceeds from disposals of property, plant and equipment
|
42
|
|
41
|
|
||
Other investing activities
|
(259
|
)
|
(63
|
)
|
||
Net cash provided by (used in) investing activities
|
(1,224
|
)
|
(937
|
)
|
||
FINANCING ACTIVITIES
|
|
|
||||
Issuances of debt
|
18,586
|
|
15,947
|
|
||
Payments of debt
|
(14,910
|
)
|
(12,750
|
)
|
||
Issuances of stock
|
917
|
|
1,108
|
|
||
Purchases of stock for treasury
|
(2,197
|
)
|
(2,156
|
)
|
||
Dividends
|
(1,584
|
)
|
(3,017
|
)
|
||
Other financing activities
|
(15
|
)
|
85
|
|
||
Net cash provided by (used in) financing activities
|
797
|
|
(783
|
)
|
||
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS
|
199
|
|
238
|
|
||
CASH AND CASH EQUIVALENTS
|
|
|
||||
Net increase (decrease) during the period
|
3,163
|
|
2,338
|
|
||
Balance at beginning of period
|
8,555
|
|
7,309
|
|
||
Balance at end of period
|
$
|
11,718
|
|
$
|
9,647
|
|
|
June 30,
2017 |
|
|
December 31, 2016
|
|
|
||
Cash, cash equivalents and short-term investments
|
$
|
21
|
|
|
$
|
49
|
|
|
Trade accounts receivable, less allowances
|
289
|
|
|
43
|
|
|
||
Inventories
|
187
|
|
|
264
|
|
|
||
Prepaid expenses and other assets
|
32
|
|
|
114
|
|
|
||
Equity method investments
|
—
|
|
|
1
|
|
|
||
Other investments
|
42
|
|
|
42
|
|
|
||
Other assets
|
17
|
|
|
17
|
|
|
||
Property, plant and equipment — net
|
1,252
|
|
|
1,780
|
|
|
||
Bottlers' franchise rights with indefinite lives
|
1,127
|
|
|
1,388
|
|
|
||
Goodwill
|
353
|
|
|
390
|
|
|
||
Other intangible assets
|
47
|
|
|
51
|
|
|
||
Allowance for reduction of assets held for sale
|
(1,310
|
)
|
|
(1,342
|
)
|
|
||
Total assets
|
$
|
2,057
|
|
1
|
$
|
2,797
|
|
3
|
Accounts payable and accrued expenses
|
$
|
267
|
|
|
$
|
393
|
|
|
Accrued income taxes
|
8
|
|
|
13
|
|
|
||
Other liabilities
|
8
|
|
|
1
|
|
|
||
Deferred income taxes
|
—
|
|
|
303
|
|
|
||
Total liabilities
|
$
|
283
|
|
2
|
$
|
710
|
|
4
|
2
|
Consists of total liabilities relating to North America refranchising of
$189 million
and China bottling operations of
$94 million
, which are included in the Bottling Investments operating segment.
|
4
|
Consists of total liabilities relating to North America refranchising of
$224 million
, China bottling operations of
$483 million
and other liabilities held for sale of
$3 million
, which are included in the Bottling Investments operating segment and Corporate.
|
|
June 30,
2017 |
|
December 31, 2016
|
|
||
Marketable securities
|
$
|
309
|
|
$
|
282
|
|
Other assets
|
106
|
|
102
|
|
||
Total
|
$
|
415
|
|
$
|
384
|
|
|
|
Gross Unrealized
|
|
Estimated
|
|
||||||||
|
Cost
|
|
Gains
|
|
Losses
|
|
|
Fair Value
|
|
||||
Available-for-sale securities:
1
|
|
|
|
|
|
||||||||
Equity securities
|
$
|
1,268
|
|
$
|
634
|
|
$
|
(31
|
)
|
|
$
|
1,871
|
|
Debt securities
|
6,076
|
|
117
|
|
(22
|
)
|
|
6,171
|
|
||||
Total
|
$
|
7,344
|
|
$
|
751
|
|
$
|
(53
|
)
|
|
$
|
8,042
|
|
|
|
Gross Unrealized
|
|
Estimated
|
|
||||||||
|
Cost
|
|
Gains
|
|
Losses
|
|
|
Fair Value
|
|
||||
Available-for-sale securities:
1
|
|
|
|
|
|
||||||||
Equity securities
|
$
|
1,252
|
|
$
|
425
|
|
$
|
(22
|
)
|
|
$
|
1,655
|
|
Debt securities
|
4,700
|
|
89
|
|
(31
|
)
|
|
4,758
|
|
||||
Total
|
$
|
5,952
|
|
$
|
514
|
|
$
|
(53
|
)
|
|
$
|
6,413
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||
|
June 30,
2017 |
|
July 1,
2016 |
|
|
June 30,
2017 |
|
July 1,
2016 |
|
||||
Gross gains
|
$
|
14
|
|
$
|
10
|
|
|
$
|
40
|
|
$
|
110
|
|
Gross losses
|
(7
|
)
|
(6
|
)
|
|
(14
|
)
|
(36
|
)
|
||||
Proceeds
|
3,456
|
|
2,301
|
|
|
6,550
|
|
6,817
|
|
|
June 30,
2017 |
|
December 31,
2016 |
|
||
Cash and cash equivalents
|
$
|
1,795
|
|
$
|
682
|
|
Marketable securities
|
4,180
|
|
3,769
|
|
||
Other investments
|
1,014
|
|
849
|
|
||
Other assets
|
1,053
|
|
1,113
|
|
||
Total
|
$
|
8,042
|
|
$
|
6,413
|
|
|
Cost
|
|
Estimated Fair Value
|
|
||
Within 1 year
|
$
|
2,261
|
|
$
|
2,305
|
|
After 1 year through 5 years
|
3,358
|
|
3,385
|
|
||
After 5 years through 10 years
|
142
|
|
158
|
|
||
After 10 years
|
315
|
|
323
|
|
||
Equity securities
|
1,268
|
|
1,871
|
|
||
Total
|
$
|
7,344
|
|
$
|
8,042
|
|
|
June 30,
2017 |
|
December 31,
2016 |
|
||
Raw materials and packaging
|
$
|
1,709
|
|
$
|
1,565
|
|
Finished goods
|
828
|
|
844
|
|
||
Other
|
253
|
|
266
|
|
||
Total inventories
|
$
|
2,790
|
|
$
|
2,675
|
|
|
|
Fair Value
1,2
|
|||||
Derivatives Designated as Hedging Instruments
|
Balance Sheet Location
1
|
June 30,
2017 |
|
December 31, 2016
|
|
||
Assets:
|
|
|
|
||||
Foreign currency contracts
|
Prepaid expenses and other assets
|
$
|
229
|
|
$
|
400
|
|
Foreign currency contracts
|
Other assets
|
43
|
|
60
|
|
||
Interest rate contracts
|
Other assets
|
69
|
|
105
|
|
||
Total assets
|
|
$
|
341
|
|
$
|
565
|
|
Liabilities:
|
|
|
|
||||
Foreign currency contracts
|
Accounts payable and accrued expenses
|
$
|
72
|
|
$
|
40
|
|
Foreign currency contracts
|
Other liabilities
|
49
|
|
54
|
|
||
Commodity contracts
|
Accounts payable and accrued expenses
|
1
|
|
1
|
|
||
Interest rate contracts
|
Accounts payable and accrued expenses
|
31
|
|
36
|
|
||
Interest rate contracts
|
Other liabilities
|
51
|
|
47
|
|
||
Total liabilities
|
|
$
|
204
|
|
$
|
178
|
|
|
|
Fair Value
1,2
|
|||||
Derivatives Not Designated as Hedging Instruments
|
Balance Sheet Location
1
|
June 30,
2017 |
|
December 31, 2016
|
|
||
Assets:
|
|
|
|
||||
Foreign currency contracts
|
Prepaid expenses and other assets
|
$
|
46
|
|
$
|
284
|
|
Foreign currency contracts
|
Other assets
|
10
|
|
—
|
|
||
Commodity contracts
|
Prepaid expenses and other assets
|
14
|
|
27
|
|
||
Commodity contracts
|
Other assets
|
1
|
|
1
|
|
||
Other derivative instruments
|
Prepaid expenses and other assets
|
6
|
|
4
|
|
||
Other derivative instruments
|
Other assets
|
1
|
|
1
|
|
||
Total assets
|
|
$
|
78
|
|
$
|
317
|
|
Liabilities:
|
|
|
|
||||
Foreign currency contracts
|
Accounts payable and accrued expenses
|
$
|
43
|
|
$
|
60
|
|
Foreign currency contracts
|
Other liabilities
|
17
|
|
16
|
|
||
Commodity contracts
|
Accounts payable and accrued expenses
|
7
|
|
16
|
|
||
Commodity contracts
|
Other liabilities
|
2
|
|
1
|
|
||
Interest rate contracts
|
Accounts payable and accrued expenses
|
—
|
|
8
|
|
||
Interest rate contracts
|
Other liabilities
|
—
|
|
1
|
|
||
Other derivative instruments
|
Accounts payable and accrued expenses
|
4
|
|
2
|
|
||
Other derivative instruments
|
Other liabilities
|
1
|
|
5
|
|
||
Total liabilities
|
|
$
|
74
|
|
$
|
109
|
|
|
Gain (Loss) Recognized
in OCI
|
|
Location of Gain (Loss)
Recognized in Income
1
|
Gain (Loss)
Reclassified from
AOCI into Income
(Effective Portion)
|
|
Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
|
|
|
|||
Foreign currency contracts
|
$
|
(94
|
)
|
Net operating revenues
|
$
|
116
|
|
$
|
(1
|
)
|
|
Foreign currency contracts
|
(5
|
)
|
Cost of goods sold
|
2
|
|
—
|
|
2
|
|||
Foreign currency contracts
|
—
|
|
Interest expense
|
(3
|
)
|
—
|
|
|
|||
Foreign currency contracts
|
(2
|
)
|
Other income (loss) — net
|
25
|
|
8
|
|
|
|||
Interest rate contracts
|
(25
|
)
|
Interest expense
|
(9
|
)
|
2
|
|
|
|||
Commodity contracts
|
—
|
|
Cost of goods sold
|
—
|
|
—
|
|
|
|||
Total
|
$
|
(126
|
)
|
|
$
|
131
|
|
$
|
9
|
|
|
|
Gain (Loss) Recognized
in OCI
|
|
Location of Gain (Loss)
Recognized in Income
1
|
Gain (Loss)
Reclassified from
AOCI into Income
(Effective Portion)
|
|
Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
|
|
|
|||
Foreign currency contracts
|
$
|
(181
|
)
|
Net operating revenues
|
$
|
223
|
|
$
|
(1
|
)
|
|
Foreign currency contracts
|
(16
|
)
|
Cost of goods sold
|
5
|
|
—
|
|
2
|
|||
Foreign currency contracts
|
—
|
|
Interest expense
|
(5
|
)
|
—
|
|
|
|||
Foreign currency contracts
|
13
|
|
Other income (loss) — net
|
52
|
|
—
|
|
2
|
|||
Interest rate contracts
|
(24
|
)
|
Interest expense
|
(17
|
)
|
2
|
|
|
|||
Commodity contracts
|
(1
|
)
|
Cost of goods sold
|
1
|
|
—
|
|
|
|||
Total
|
$
|
(209
|
)
|
|
$
|
259
|
|
$
|
1
|
|
|
|
Gain (Loss)
Recognized
in OCI
|
|
Location of Gain (Loss)
Recognized in Income
1
|
Gain (Loss)
Reclassified from
AOCI into Income
(Effective Portion)
|
|
Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
|
|
|
|||
Foreign currency contracts
|
$
|
46
|
|
Net operating revenues
|
$
|
138
|
|
$
|
(1
|
)
|
|
Foreign currency contracts
|
(19
|
)
|
Cost of goods sold
|
13
|
|
(1
|
)
|
|
|||
Foreign currency contracts
|
—
|
|
Interest expense
|
(2
|
)
|
—
|
|
|
|||
Foreign currency contracts
|
(53
|
)
|
Other income (loss) — net
|
(45
|
)
|
—
|
|
|
|||
Interest rate contracts
|
(95
|
)
|
Interest expense
|
(2
|
)
|
—
|
|
|
|||
Commodity contracts
|
1
|
|
Cost of goods sold
|
—
|
|
—
|
|
|
|||
Total
|
$
|
(120
|
)
|
|
$
|
102
|
|
$
|
(2
|
)
|
|
|
Gain (Loss)
Recognized
in OCI
|
|
Location of Gain (Loss)
Recognized in Income
1
|
Gain (Loss)
Reclassified from
AOCI into Income
(Effective Portion)
|
|
Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
|
|
|
|||
Foreign currency contracts
|
$
|
(300
|
)
|
Net operating revenues
|
$
|
278
|
|
$
|
(1
|
)
|
|
Foreign currency contracts
|
(43
|
)
|
Cost of goods sold
|
33
|
|
(1
|
)
|
|
|||
Foreign currency contracts
|
—
|
|
Interest expense
|
(4
|
)
|
—
|
|
|
|||
Foreign currency contracts
|
(11
|
)
|
Other income (loss) — net
|
(2
|
)
|
—
|
|
|
|||
Interest rate contracts
|
(252
|
)
|
Interest expense
|
(4
|
)
|
—
|
|
|
|||
Commodity contracts
|
1
|
|
Cost of goods sold
|
—
|
|
—
|
|
|
|||
Total
|
$
|
(605
|
)
|
|
$
|
301
|
|
$
|
(2
|
)
|
|
Hedging Instruments and Hedged Items
|
Location of Gain (Loss)
Recognized in Income
|
Gain (Loss)
Recognized in Income
1
|
|||||
Three Months Ended
|
|||||||
June 30,
2017 |
|
July 1,
2016 |
|
||||
Interest rate contracts
|
Interest expense
|
$
|
(23
|
)
|
$
|
92
|
|
Fixed-rate debt
|
Interest expense
|
24
|
|
(86
|
)
|
||
Net impact to interest expense
|
|
$
|
1
|
|
$
|
6
|
|
Foreign currency contracts
|
Other income (loss) — net
|
$
|
(24
|
)
|
$
|
(21
|
)
|
Available-for-sale securities
|
Other income (loss) — net
|
24
|
|
26
|
|
||
Net impact to other income (loss) — net
|
|
$
|
—
|
|
$
|
5
|
|
Net impact of fair value hedging instruments
|
|
$
|
1
|
|
$
|
11
|
|
Hedging Instruments and Hedged Items
|
Location of Gain (Loss)
Recognized in Income
|
Gain (Loss)
Recognized in Income
1
|
|||||
Six Months Ended
|
|||||||
June 30,
2017 |
|
July 1,
2016 |
|
||||
Interest rate contracts
|
Interest expense
|
$
|
(65
|
)
|
$
|
398
|
|
Fixed-rate debt
|
Interest expense
|
57
|
|
(363
|
)
|
||
Net impact to interest expense
|
|
$
|
(8
|
)
|
$
|
35
|
|
Foreign currency contracts
|
Other income (loss) — net
|
$
|
(43
|
)
|
$
|
30
|
|
Available-for-sale securities
|
Other income (loss) — net
|
46
|
|
(32
|
)
|
||
Net impact to other income (loss) — net
|
|
$
|
3
|
|
$
|
(2
|
)
|
Net impact of fair value hedging instruments
|
|
$
|
(5
|
)
|
$
|
33
|
|
|
Notional Amount
|
|
Gain (Loss) Recognized in OCI
|
|
Gain (Loss) Recognized in OCI
|
|||||||||||||||
|
as of
|
|
Three Months Ended
|
|
Six Months Ended
|
|||||||||||||||
|
June 30,
2017 |
|
December 31, 2016
|
|
|
June 30,
2017 |
|
July 1,
2016 |
|
|
June 30,
2017 |
|
July 1,
2016 |
|
||||||
Foreign currency contracts
|
$
|
50
|
|
$
|
100
|
|
|
$
|
(2
|
)
|
$
|
(81
|
)
|
|
$
|
(15
|
)
|
$
|
(226
|
)
|
Foreign currency denominated debt
|
12,569
|
|
11,113
|
|
|
(928
|
)
|
265
|
|
|
(926
|
)
|
(256
|
)
|
||||||
Total
|
$
|
12,619
|
|
$
|
11,213
|
|
|
$
|
(930
|
)
|
$
|
184
|
|
|
$
|
(941
|
)
|
$
|
(482
|
)
|
|
|
Three Months Ended
|
|||||
Derivatives Not Designated
as Hedging Instruments |
Location of Gain (Loss)
Recognized in Income |
June 30,
2017 |
|
July 1,
2016 |
|
||
Foreign currency contracts
|
Net operating revenues
|
$
|
(8
|
)
|
$
|
(3
|
)
|
Foreign currency contracts
|
Cost of goods sold
|
—
|
|
7
|
|
||
Foreign currency contracts
|
Other income (loss) — net
|
66
|
|
(54
|
)
|
||
Commodity contracts
|
Net operating revenues
|
(2
|
)
|
4
|
|
||
Commodity contracts
|
Cost of goods sold
|
(3
|
)
|
54
|
|
||
Commodity contracts
|
Selling, general and administrative expenses
|
(2
|
)
|
6
|
|
||
Other derivative instruments
|
Selling, general and administrative expenses
|
13
|
|
—
|
|
||
Other derivative instruments
|
Other income (loss) — net
|
1
|
|
(4
|
)
|
||
Total
|
|
$
|
65
|
|
$
|
10
|
|
|
|
Six Months Ended
|
|||||
Derivatives Not Designated
as Hedging Instruments |
Location of Gain (Loss)
Recognized in Income |
June 30,
2017 |
|
July 1,
2016 |
|
||
Foreign currency contracts
|
Net operating revenues
|
$
|
(18
|
)
|
$
|
(28
|
)
|
Foreign currency contracts
|
Cost of goods sold
|
—
|
|
4
|
|
||
Foreign currency contracts
|
Other income (loss) — net
|
102
|
|
(116
|
)
|
||
Commodity contracts
|
Net operating revenues
|
(5
|
)
|
3
|
|
||
Commodity contracts
|
Cost of goods sold
|
28
|
|
77
|
|
||
Commodity contracts
|
Selling, general and administrative expenses
|
(3
|
)
|
4
|
|
||
Other derivative instruments
|
Selling, general and administrative expenses
|
25
|
|
8
|
|
||
Other derivative instruments
|
Other income (loss) — net
|
1
|
|
(14
|
)
|
||
Total
|
|
$
|
130
|
|
$
|
(62
|
)
|
•
|
$500 million
total principal amount of notes due May 25, 2022, at a fixed interest rate of
2.20 percent
;
|
•
|
$500 million
total principal amount of notes due May 25, 2027, at a fixed interest rate of
2.90 percent
;
|
•
|
€1,500 million
total principal amount of notes due March 8, 2019, at a variable interest rate equal to the three-month Euro Interbank Offered Rate ("EURIBOR") plus
0.25 percent
;
|
•
|
€500 million
total principal amount of notes due March 9, 2021, at a fixed interest rate of
0.00 percent
; and
|
•
|
€500 million
total principal amount of notes due March 8, 2024, at a fixed interest rate of
0.50 percent
.
|
•
|
$95.6 million
total principal amount o
f notes due August 15, 2019, at a fixed interest rate of
4.50 percent
;
|
•
|
$11.7 million
total principal amount of notes due September 15, 2022, at a fixed interest rate of
8.00 percent
;
|
•
|
$36.5 million
total principal amount of notes due September 15, 2023, at a fixed interest rate of
6.75 percent
;
|
•
|
$9.9 million
total principal amount of notes due October 1, 2026, at a fixed interest rate of
7.00 percent
;
|
•
|
$53.8 million
total principal amount of notes due November 15, 2026, at a fixed interest rate of
6.95 percent
;
|
•
|
$41.3 million
total principal amount of notes due September 15, 2028, at a fixed interest rate of
6.75 percent
;
|
•
|
$32.0 million
total principal amount of notes due October 15, 2036, at a fixed interest rate of
6.70 percent
;
|
•
|
$3.4 million
total principal amount of notes due March 18, 2037, at a fixed interest rate of
5.71 percent
;
|
•
|
$24.3 million
total principal amount of notes due January 15, 2038, at a fixed interest rate of
6.75 percent
; and
|
•
|
$4.7 million
total principal amount of notes due May 15, 2098, at a fixed interest rate of
7.00 percent
.
|
|
June 30,
2017 |
|
|
December 31, 2016
|
|
||
Foreign currency translation adjustments
|
$
|
(8,963
|
)
|
|
$
|
(9,780
|
)
|
Accumulated derivative net gains (losses)
|
16
|
|
|
314
|
|
||
Unrealized net gains (losses) on available-for-sale securities
|
469
|
|
|
305
|
|
||
Adjustments to pension and other benefit liabilities
|
(2,011
|
)
|
|
(2,044
|
)
|
||
Accumulated other comprehensive income (loss)
|
$
|
(10,489
|
)
|
|
$
|
(11,205
|
)
|
|
Six Months Ended June 30, 2017
|
||||||||
|
Shareowners of
The Coca-Cola Company
|
|
Noncontrolling
Interests
|
|
Total
|
|
|||
Consolidated net income
|
$
|
2,553
|
|
$
|
3
|
|
$
|
2,556
|
|
Other comprehensive income:
|
|
|
|
||||||
Net foreign currency translation adjustment
|
817
|
|
1
|
|
818
|
|
|||
Net gain (loss) on derivatives
1
|
(298
|
)
|
—
|
|
(298
|
)
|
|||
Net change in unrealized gain (loss) on available-for-sale securities
2
|
164
|
|
—
|
|
164
|
|
|||
Net change in pension and other benefit liabilities
3
|
33
|
|
—
|
|
33
|
|
|||
Total comprehensive income
|
$
|
3,269
|
|
$
|
4
|
|
$
|
3,273
|
|
3
|
Refer to
Note 12
for additional information related to the Company's pension and other postretirement benefit liabilities.
|
Three Months Ended June 30, 2017
|
Before-Tax Amount
|
|
|
Income Tax
|
|
|
After-Tax Amount
|
|
|||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||||
Translation adjustments arising during the period
|
$
|
(1,427
|
)
|
|
$
|
(15
|
)
|
|
$
|
(1,442
|
)
|
Reclassification adjustments recognized in net income
|
120
|
|
|
(6
|
)
|
|
114
|
|
|||
Gains (losses) on intra-entity transactions that are of a long-term-investment nature
|
1,799
|
|
|
—
|
|
|
1,799
|
|
|||
Gains (losses) on net investment hedges arising during the period
1
|
(930
|
)
|
|
356
|
|
|
(574
|
)
|
|||
Net foreign currency translation adjustments
|
(438
|
)
|
|
335
|
|
|
(103
|
)
|
|||
Derivatives:
|
|
|
|
|
|
||||||
Gains (losses) arising during the period
|
(135
|
)
|
|
43
|
|
|
(92
|
)
|
|||
Reclassification adjustments recognized in net income
|
(139
|
)
|
|
54
|
|
|
(85
|
)
|
|||
Net gains (losses) on derivatives
1
|
(274
|
)
|
|
97
|
|
|
(177
|
)
|
|||
Available-for-sale securities:
|
|
|
|
|
|
||||||
Unrealized gains (losses) arising during the period
|
87
|
|
|
(19
|
)
|
|
68
|
|
|||
Reclassification adjustments recognized in net income
|
(94
|
)
|
|
31
|
|
|
(63
|
)
|
|||
Net change in unrealized gain (loss) on available-for-sale securities
2
|
(7
|
)
|
|
12
|
|
|
5
|
|
|||
Pension and other benefit liabilities:
|
|
|
|
|
|
||||||
Net pension and other benefit liabilities arising during the period
|
(37
|
)
|
|
5
|
|
|
(32
|
)
|
|||
Reclassification adjustments recognized in net income
|
32
|
|
|
(8
|
)
|
|
24
|
|
|||
Net change in pension and other benefit liabilities
3
|
(5
|
)
|
|
(3
|
)
|
|
(8
|
)
|
|||
Other comprehensive income (loss) attributable to shareowners of The Coca-Cola Company
|
$
|
(724
|
)
|
|
$
|
441
|
|
|
$
|
(283
|
)
|
1
|
Refer to
Note 5
for additional information related to the net gain or loss on derivative instruments designated and qualifying as cash flow hedging instruments.
|
2
|
Includes reclassification adjustments related to divestitures of certain available-for-sale securities. Refer to
Note 3
and
Note 10
for additional information related to these divestitures.
|
3
|
Refer to
Note 12
for additional information related to the Company's pension and other postretirement benefit liabilities.
|
Six Months Ended June 30, 2017
|
Before-Tax Amount
|
|
|
Income Tax
|
|
|
After-Tax Amount
|
|
|||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||||
Translation adjustments arising during the period
|
$
|
(955
|
)
|
|
$
|
32
|
|
|
$
|
(923
|
)
|
Reclassification adjustments recognized in net income
|
120
|
|
|
(6
|
)
|
|
114
|
|
|||
Gains (losses) on intra-entity transactions that are of a long-term-investment nature
|
2,207
|
|
|
—
|
|
|
2,207
|
|
|||
Gains (losses) on net investment hedges arising during the period
1
|
(941
|
)
|
|
360
|
|
|
(581
|
)
|
|||
Net foreign currency translation adjustments
|
431
|
|
|
386
|
|
|
817
|
|
|||
Derivatives:
|
|
|
|
|
|
||||||
Gains (losses) arising during the period
|
(213
|
)
|
|
75
|
|
|
(138
|
)
|
|||
Reclassification adjustments recognized in net income
|
(259
|
)
|
|
99
|
|
|
(160
|
)
|
|||
Net gains (losses) on derivatives
1
|
(472
|
)
|
|
174
|
|
|
(298
|
)
|
|||
Available-for-sale securities:
|
|
|
|
|
|
||||||
Unrealized gains (losses) arising during the period
|
345
|
|
|
(106
|
)
|
|
239
|
|
|||
Reclassification adjustments recognized in net income
|
(113
|
)
|
|
38
|
|
|
(75
|
)
|
|||
Net change in unrealized gain (loss) on available-for-sale securities
2
|
232
|
|
|
(68
|
)
|
|
164
|
|
|||
Pension and other benefit liabilities:
|
|
|
|
|
|
||||||
Net pension and other benefit liabilities arising during the period
|
(41
|
)
|
|
24
|
|
|
(17
|
)
|
|||
Reclassification adjustments recognized in net income
|
73
|
|
|
(23
|
)
|
|
50
|
|
|||
Net change in pension and other benefit liabilities
3
|
32
|
|
|
1
|
|
|
33
|
|
|||
Other comprehensive income (loss) attributable to shareowners of The Coca-Cola Company
|
$
|
223
|
|
|
$
|
493
|
|
|
$
|
716
|
|
1
|
Refer to
Note 5
for additional information related to the net gain or loss on derivative instruments designated and qualifying as cash flow hedging instruments.
|
2
|
Includes reclassification adjustments related to divestitures of certain available-for-sale securities. Refer to
Note 3
and
Note 10
for additional information related to these divestitures.
|
3
|
Refer to
Note 12
for additional information related to the Company's pension and other postretirement benefit liabilities.
|
Three Months Ended July 1, 2016
|
Before-Tax Amount
|
|
|
Income Tax
|
|
|
After-Tax Amount
|
|
|||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||||
Translation adjustment arising during the period
|
$
|
428
|
|
|
$
|
(108
|
)
|
|
$
|
320
|
|
Reclassification adjustments recognized in income
|
126
|
|
|
—
|
|
|
126
|
|
|||
Gains (losses) on net investment hedges arising during the period
1
|
184
|
|
|
(70
|
)
|
|
114
|
|
|||
Reclassification adjustments for net investment hedges recognized in net income
1
|
77
|
|
|
(30
|
)
|
|
47
|
|
|||
Net foreign currency translation adjustments
|
815
|
|
|
(208
|
)
|
|
607
|
|
|||
Derivatives:
|
|
|
|
|
|
||||||
Gains (losses) arising during the period
|
(122
|
)
|
|
47
|
|
|
(75
|
)
|
|||
Reclassification adjustments recognized in net income
|
(100
|
)
|
|
37
|
|
|
(63
|
)
|
|||
Net gains (losses) on derivatives
1
|
(222
|
)
|
|
84
|
|
|
(138
|
)
|
|||
Available-for-sale securities:
|
|
|
|
|
|
||||||
Unrealized gains (losses) arising during the period
|
161
|
|
|
(49
|
)
|
|
112
|
|
|||
Reclassification adjustments recognized in net income
|
(4
|
)
|
|
1
|
|
|
(3
|
)
|
|||
Net change in unrealized gain (loss) on available-for-sale securities
2
|
157
|
|
|
(48
|
)
|
|
109
|
|
|||
Pension and other benefit liabilities:
|
|
|
|
|
|
||||||
Net pension and other benefit liabilities arising during the period
|
(18
|
)
|
|
4
|
|
|
(14
|
)
|
|||
Reclassification adjustments recognized in net income
|
106
|
|
|
(34
|
)
|
|
72
|
|
|||
Net change in pension and other benefit liabilities
3
|
88
|
|
|
(30
|
)
|
|
58
|
|
|||
Other comprehensive income (loss) attributable to shareowners of The Coca-Cola Company
|
$
|
838
|
|
|
$
|
(202
|
)
|
|
$
|
636
|
|
1
|
Refer to
Note 5
for additional information related to the net gain or loss on derivative instruments designated and qualifying as cash flow hedging instruments.
|
2
|
Includes reclassification adjustments related to divestitures of certain available-for-sale securities. Refer to
Note 3
for additional information related to these divestitures.
|
3
|
Refer to
Note 12
for additional information related to the Company's pension and other postretirement benefit liabilities.
|
Six Months Ended July 1, 2016
|
Before-Tax Amount
|
|
|
Income Tax
|
|
|
After-Tax Amount
|
|
|||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||||
Translation adjustment arising during the period
|
$
|
462
|
|
|
$
|
(2
|
)
|
|
$
|
460
|
|
Reclassification adjustments recognized in income
|
126
|
|
|
—
|
|
|
126
|
|
|||
Gains (losses) on net investment hedges arising during the period
1
|
(482
|
)
|
|
185
|
|
|
(297
|
)
|
|||
Reclassification adjustments for net investment hedges recognized in net income
1
|
77
|
|
|
(30
|
)
|
|
47
|
|
|||
Net foreign currency translation adjustments
|
183
|
|
|
153
|
|
|
336
|
|
|||
Derivatives:
|
|
|
|
|
|
||||||
Gains (losses) arising during the period
|
(607
|
)
|
|
229
|
|
|
(378
|
)
|
|||
Reclassification adjustments recognized in net income
|
(299
|
)
|
|
112
|
|
|
(187
|
)
|
|||
Net gains (losses) on derivatives
1
|
(906
|
)
|
|
341
|
|
|
(565
|
)
|
|||
Available-for-sale securities:
|
|
|
|
|
|
||||||
Unrealized gains (losses) arising during the period
|
294
|
|
|
(77
|
)
|
|
217
|
|
|||
Reclassification adjustments recognized in net income
|
(74
|
)
|
|
18
|
|
|
(56
|
)
|
|||
Net change in unrealized gain (loss) on available-for-sale securities
2
|
220
|
|
|
(59
|
)
|
|
161
|
|
|||
Pension and other benefit liabilities:
|
|
|
|
|
|
||||||
Net pension and other benefit liabilities arising during the period
|
(12
|
)
|
|
1
|
|
|
(11
|
)
|
|||
Reclassification adjustments recognized in net income
|
149
|
|
|
(49
|
)
|
|
100
|
|
|||
Net change in pension and other benefit liabilities
3
|
137
|
|
|
(48
|
)
|
|
89
|
|
|||
Other comprehensive income (loss) attributable to shareowners of The Coca-Cola Company
|
$
|
(366
|
)
|
|
$
|
387
|
|
|
$
|
21
|
|
1
|
Refer to
Note 5
for additional information related to the net gain or loss on derivative instruments designated and qualifying as cash flow hedging instruments.
|
2
|
Includes reclassification adjustments related to divestitures of certain available-for-sale securities. Refer to
Note 3
for additional information related to these divestitures.
|
3
|
Refer to
Note 12
for additional information related to the Company's pension and other postretirement benefit liabilities.
|
|
|
Amount Reclassified from
AOCI into Income
|
|
||||||
Description of AOCI Component
|
Financial Statement Line Item
|
Three Months Ended June 30, 2017
|
|
Six Months Ended June 30, 2017
|
|
||||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||
Divestitures, deconsolidations and other
1
|
Other income (loss) — net
|
$
|
120
|
|
|
$
|
120
|
|
|
|
Income before income taxes
|
120
|
|
|
120
|
|
|
||
|
Income taxes
|
(6
|
)
|
|
(6
|
)
|
|
||
|
Consolidated net income
|
$
|
114
|
|
|
$
|
114
|
|
|
Derivatives:
|
|
|
|
|
|
||||
Foreign currency contracts
|
Net operating revenues
|
$
|
(115
|
)
|
|
$
|
(222
|
)
|
|
Foreign currency and commodity contracts
|
Cost of goods sold
|
(2
|
)
|
|
(6
|
)
|
|
||
Foreign currency contracts
|
Other income (loss) — net
|
(33
|
)
|
|
(52
|
)
|
|
||
Divestitures, deconsolidations and other
1
|
Other income (loss) — net
|
1
|
|
|
1
|
|
|
||
Foreign currency and interest rate contracts
|
Interest expense
|
10
|
|
|
20
|
|
|
||
|
Income before income taxes
|
(139
|
)
|
|
(259
|
)
|
|
||
|
Income taxes
|
54
|
|
|
99
|
|
|
||
|
Consolidated net income
|
$
|
(85
|
)
|
|
$
|
(160
|
)
|
|
Available-for-sale securities:
|
|
|
|
|
|
||||
Divestitures, deconsolidations and other
1
|
Other income (loss) — net
|
$
|
(87
|
)
|
|
$
|
(87
|
)
|
|
Sale of securities
|
Other income (loss) — net
|
(7
|
)
|
|
(26
|
)
|
|
||
|
Income before income taxes
|
(94
|
)
|
|
(113
|
)
|
|
||
|
Income taxes
|
31
|
|
|
38
|
|
|
||
|
Consolidated net income
|
$
|
(63
|
)
|
|
$
|
(75
|
)
|
|
Pension and other benefit liabilities:
|
|
|
|
|
|
||||
Curtailment charge
|
Other operating charges
|
$
|
(18
|
)
|
|
$
|
(18
|
)
|
|
Divestitures, deconsolidations and other
1
|
Other income (loss) — net
|
7
|
|
|
7
|
|
|
||
Recognized net actuarial loss (gain)
|
*
|
47
|
|
|
93
|
|
|
||
Recognized prior service cost (credit)
|
*
|
(4
|
)
|
|
(9
|
)
|
|
||
|
Income before income taxes
|
32
|
|
|
73
|
|
|
||
|
Income taxes
|
(8
|
)
|
|
(23
|
)
|
|
||
|
Consolidated net income
|
$
|
24
|
|
|
$
|
50
|
|
|
|
|
|
Shareowners of The Coca-Cola Company
|
|
|
||||||||||||||||||
|
Common Shares Outstanding
|
|
Total
|
|
Reinvested
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Common
Stock
|
|
Capital
Surplus
|
|
Treasury
Stock
|
|
Non-
controlling
Interests
|
|
|||||||
December 31, 2016
|
4,288
|
|
$
|
23,220
|
|
$
|
65,502
|
|
$
|
(11,205
|
)
|
$
|
1,760
|
|
$
|
14,993
|
|
$
|
(47,988
|
)
|
$
|
158
|
|
Comprehensive income (loss)
|
—
|
|
3,273
|
|
2,553
|
|
716
|
|
—
|
|
—
|
|
—
|
|
4
|
|
|||||||
Dividends paid/payable to shareowners of The Coca-Cola Company
|
—
|
|
(3,165
|
)
|
(3,165
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Dividends paid to noncontrolling interests
|
—
|
|
(14
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(14
|
)
|
|||||||
Deconsolidation of certain entities
|
—
|
|
(95
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(95
|
)
|
|||||||
Purchases of treasury stock
|
(51
|
)
|
(2,189
|
)
|
—
|
|
—
|
|
—
|
|
|
|
(2,189
|
)
|
—
|
|
|||||||
Impact related to stock compensation plans
|
31
|
|
1,027
|
|
—
|
|
—
|
|
—
|
|
483
|
|
544
|
|
—
|
|
|||||||
Other activities
|
—
|
|
32
|
|
—
|
|
—
|
|
—
|
|
(3
|
)
|
—
|
|
35
|
|
|||||||
June 30, 2017
|
4,268
|
|
$
|
22,089
|
|
$
|
64,890
|
|
$
|
(10,489
|
)
|
$
|
1,760
|
|
$
|
15,473
|
|
$
|
(49,633
|
)
|
$
|
88
|
|
|
Accrued
Balance
March 31, 2017
|
|
Costs
Incurred
Three Months Ended
June 30, 2017
|
|
Payments
|
|
Noncash
and
Exchange
|
|
Accrued
Balance
June 30, 2017
|
|
|||||
Severance pay and benefits
|
$
|
177
|
|
$
|
10
|
|
$
|
(22
|
)
|
$
|
(3
|
)
|
$
|
162
|
|
Outside services
|
10
|
|
27
|
|
(25
|
)
|
(1
|
)
|
11
|
|
|||||
Other direct costs
|
18
|
|
50
|
|
(51
|
)
|
(1
|
)
|
16
|
|
|||||
Total
|
$
|
205
|
|
$
|
87
|
|
$
|
(98
|
)
|
$
|
(5
|
)
|
$
|
189
|
|
|
Accrued
Balance
December 31, 2016
|
|
Costs
Incurred
Six Months Ended
June 30, 2017
|
|
Payments
|
|
Noncash
and
Exchange
|
|
Accrued
Balance
June 30, 2017
|
|
|||||
Severance pay and benefits
|
$
|
123
|
|
$
|
100
|
|
$
|
(58
|
)
|
$
|
(3
|
)
|
$
|
162
|
|
Outside services
|
6
|
|
43
|
|
(38
|
)
|
—
|
|
11
|
|
|||||
Other direct costs
|
22
|
|
83
|
|
(85
|
)
|
(4
|
)
|
16
|
|
|||||
Total
|
$
|
151
|
|
$
|
226
|
|
$
|
(181
|
)
|
$
|
(7
|
)
|
$
|
189
|
|
|
Pension Benefits
|
|
Other Benefits
|
||||||||||
|
Three Months Ended
|
||||||||||||
|
June 30,
2017 |
|
July 1,
2016 |
|
|
June 30,
2017 |
|
July 1,
2016 |
|
||||
Service cost
|
$
|
50
|
|
$
|
60
|
|
|
$
|
4
|
|
$
|
6
|
|
Interest cost
|
78
|
|
80
|
|
|
7
|
|
7
|
|
||||
Expected return on plan assets
1
|
(163
|
)
|
(165
|
)
|
|
(3
|
)
|
(2
|
)
|
||||
Amortization of prior service cost (credit)
|
—
|
|
(1
|
)
|
|
(4
|
)
|
(4
|
)
|
||||
Amortization of net actuarial loss
|
45
|
|
46
|
|
|
2
|
|
1
|
|
||||
Net periodic benefit cost
|
10
|
|
20
|
|
|
6
|
|
8
|
|
||||
Curtailment charges (credits)
2
|
—
|
|
—
|
|
|
(42
|
)
|
—
|
|
||||
Special termination benefits
2
|
39
|
|
5
|
|
|
—
|
|
—
|
|
||||
Total cost recognized in condensed consolidated statements of income
|
$
|
49
|
|
$
|
25
|
|
|
$
|
(36
|
)
|
$
|
8
|
|
2
|
The curtailment credits and special termination benefits were primarily related to North America refranchising and the Company's productivity, restructuring and integration initiatives. Refer to Note 2 and
Note 11
.
|
|
Pension Benefits
|
|
Other Benefits
|
||||||||||
|
Six Months Ended
|
||||||||||||
|
June 30,
2017 |
|
July 1,
2016 |
|
|
June 30,
2017 |
|
July 1,
2016 |
|
||||
Service cost
|
$
|
100
|
|
$
|
119
|
|
|
$
|
9
|
|
$
|
11
|
|
Interest cost
|
156
|
|
160
|
|
|
15
|
|
15
|
|
||||
Expected return on plan assets
1
|
(324
|
)
|
(329
|
)
|
|
(6
|
)
|
(5
|
)
|
||||
Amortization of prior service cost (credit)
|
—
|
|
(1
|
)
|
|
(9
|
)
|
(9
|
)
|
||||
Amortization of net actuarial loss
|
89
|
|
92
|
|
|
4
|
|
3
|
|
||||
Net periodic benefit cost
|
21
|
|
41
|
|
|
13
|
|
15
|
|
||||
Curtailment charges (credits)
2
|
—
|
|
—
|
|
|
(42
|
)
|
—
|
|
||||
Special termination benefits
2
|
57
|
|
13
|
|
|
—
|
|
—
|
|
||||
Total cost recognized in condensed consolidated statements of income
|
$
|
78
|
|
$
|
54
|
|
|
$
|
(29
|
)
|
$
|
15
|
|
2
|
The curtailment credits and special termination benefits were primarily related to North America refranchising and the Company's productivity, restructuring and integration initiatives. Refer to Note 2 and
Note 11
.
|
|
Three Months Ended
|
|
Six Months Ended
|
|
||||||||||||
|
June 30,
2017 |
|
|
July 1,
2016 |
|
|
June 30,
2017 |
|
|
July 1,
2016 |
|
|
||||
Asset impairments
|
$
|
(164
|
)
|
1
|
$
|
—
|
|
|
$
|
(164
|
)
|
1
|
$
|
—
|
|
|
Productivity and reinvestment program
|
(31
|
)
|
2
|
(24
|
)
|
8
|
(83
|
)
|
2
|
(45
|
)
|
8
|
||||
Other productivity, integration and restructuring initiatives
|
—
|
|
|
—
|
|
9
|
—
|
|
|
—
|
|
9
|
||||
Transaction gains and losses
|
707
|
|
3
|
26
|
|
10
|
533
|
|
4
|
(117
|
)
|
11
|
||||
Certain tax matters
|
(40
|
)
|
5
|
83
|
|
12
|
(70
|
)
|
5
|
77
|
|
12
|
||||
Other — net
|
(12
|
)
|
6
|
(45
|
)
|
13
|
(29
|
)
|
7
|
(46
|
)
|
14
|
1
|
Related to charges of
$667 million
and
$771 million
during the
three and six months ended
June 30, 2017
, respectively, due to the impairment of certain assets. Refer to
Note 10
and
Note 14
.
|
2
|
Related to charges of
$87 million
and
$226 million
during the
three and six months ended
June 30, 2017
, respectively. These charges were due to the Company's productivity and reinvestment program. Refer to
Note 11
.
|
3
|
Related to a net gain of
$82 million
which primarily consisted of a
$445 million
gain related to the merger of CCW and CCEJ, a
$25 million
gain related to Coca-Cola FEMSA, an equity method investee, issuing additional shares of its stock and a
$9 million
gain related to refranchising a substantial portion of our China bottling operations. These gains were partially offset by a net charge of
$214 million
as a result of the refranchising of certain bottling territories in North America, charges of
$109 million
primarily related to payments made to convert the bottling agreements for certain North America bottling partners' territories to a single form of CBA with additional requirements, a charge of
$44 million
related to costs incurred to refranchise certain of our bottling operations and a charge of
$26 million
related to our former German bottling operations. Refer to
Note 2
and
Note 10
.
|
4
|
Related to charges of
$583 million
which primarily consisted of
$711 million
of net charges as a result of the refranchising of certain bottling territories in North America, charges of
$215 million
primarily related to payments made to convert the bottling agreements for certain North America bottling partners' territories to a single form of CBA with additional requirements,
$101 million
related to costs incurred to refranchise certain of our bottling operations and a charge of
$26 million
related to our former German bottling operations. These charges were partially offset by a
$445 million
gain related to the merger of CCW and CCEJ, a
$25 million
gain related to Coca-Cola FEMSA, an equity method investee
,
issuing additional shares of its stock and a
$9 million
gain related to refranchising a substantial portion of our China bottling operations. Refer to
Note 2
and
Note 10
.
|
5
|
Related to
$29 million
and
$82 million
of excess tax benefits associated with the Company's share-based compensation arrangements during the three and six months ended June 30, 2017, respectively, and the tax benefit associated with the reversal of valuation allowances in certain of the Company's foreign jurisdictions both of which were partially offset by changes to our uncertain tax positions, including interest and penalties. The components of the net change in uncertain tax positions were individually insignificant.
|
•
|
Level 1 — Quoted prices in active markets for identical assets or liabilities.
|
•
|
Level 2 — Observable inputs other than quoted prices included in Level 1. We value assets and liabilities included in this level using dealer and broker quotations, certain pricing models, bid prices, quoted prices for similar assets and liabilities in active markets, or other inputs that are observable or can be corroborated by observable market data.
|
•
|
Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.
|
June 30, 2017
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
|
Other
4
|
|
Netting
Adjustment
5
|
|
|
Fair Value
Measurements
|
|
|
||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trading securities
1
|
$
|
221
|
|
$
|
120
|
|
$
|
9
|
|
|
$
|
65
|
|
$
|
—
|
|
|
$
|
415
|
|
|
Available-for-sale securities
1
|
2,948
|
|
4,942
|
|
152
|
|
3
|
—
|
|
—
|
|
|
8,042
|
|
|
||||||
Derivatives
2
|
9
|
|
410
|
|
—
|
|
|
—
|
|
(333
|
)
|
6
|
86
|
|
8
|
||||||
Total assets
|
$
|
3,178
|
|
$
|
5,472
|
|
$
|
161
|
|
|
$
|
65
|
|
$
|
(333
|
)
|
|
$
|
8,543
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivatives
2
|
$
|
(1
|
)
|
$
|
(277
|
)
|
$
|
—
|
|
|
$
|
—
|
|
$
|
215
|
|
7
|
$
|
(63
|
)
|
8
|
Total liabilities
|
$
|
(1
|
)
|
$
|
(277
|
)
|
$
|
—
|
|
|
$
|
—
|
|
$
|
215
|
|
|
$
|
(63
|
)
|
|
1
|
Refer to
Note 3
for additional information related to the composition of our trading securities and available-for-sale securities.
|
4
|
Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy but are included to reconcile to the amounts presented in
Note 3
.
|
7
|
The Company has the right to reclaim
$22 million
in cash collateral it has netted against its derivative position.
|
8
|
The Company's derivative financial instruments are recorded at fair value in our condensed consolidated balance sheets as follows: $
86 million
in the line item other assets and $
63 million
in the line item other liabilities. Refer to
Note 5
for additional information related to the composition of our derivative portfolio.
|
December 31, 2016
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
|
Other
4
|
|
Netting
Adjustment
5
|
|
|
Fair Value
Measurements
|
|
|
||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trading securities
1
|
$
|
202
|
|
$
|
115
|
|
$
|
4
|
|
|
$
|
63
|
|
$
|
—
|
|
|
$
|
384
|
|
|
Available-for-sale securities
1
|
1,655
|
|
4,619
|
|
139
|
|
3
|
—
|
|
—
|
|
|
6,413
|
|
|
||||||
Derivatives
2
|
4
|
|
878
|
|
—
|
|
|
—
|
|
(369
|
)
|
6
|
513
|
|
8
|
||||||
Total assets
|
$
|
1,861
|
|
$
|
5,612
|
|
$
|
143
|
|
|
$
|
63
|
|
$
|
(369
|
)
|
|
$
|
7,310
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivatives
2
|
$
|
11
|
|
$
|
276
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
(192
|
)
|
7
|
$
|
95
|
|
8
|
Total liabilities
|
$
|
11
|
|
$
|
276
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
(192
|
)
|
|
$
|
95
|
|
|
1
|
Refer to
Note 3
for additional information related to the composition of our trading securities and available-for-sale securities.
|
4
|
Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy but are included to reconcile to the amounts presented in
Note 3
.
|
7
|
The Company has the right to reclaim
$17 million
in cash collateral it has netted against its derivative position.
|
8
|
The Company's derivative financial instruments are recorded at fair value in our condensed consolidated balance sheets as follows: $
347 million
in the line item prepaid expenses and other assets; $
166 million
in the line item other assets;
$42 million
in the line item accounts payable and accrued expenses; and $
53 million
in the line item other liabilities. Refer to
Note 5
for additional information related to the composition of our derivative portfolio.
|
|
Gains (Losses)
|
|||||||||||||
|
Three Months Ended
|
Six Months Ended
|
||||||||||||
|
June 30, 2017
|
|
|
July 1,
2016 |
|
June 30, 2017
|
|
|
July 1,
2016 |
|
||||
Assets held for sale
1
|
$
|
(1,145
|
)
|
|
$
|
(131
|
)
|
$
|
(1,512
|
)
|
|
$
|
(446
|
)
|
Intangible assets
|
(338
|
)
|
2
|
—
|
|
(442
|
)
|
2
|
—
|
|
||||
Other long-lived assets
|
(329
|
)
|
3
|
—
|
|
(329
|
)
|
3
|
—
|
|
||||
Valuation of shares in equity method investee
|
25
|
|
4
|
—
|
|
25
|
|
4
|
—
|
|
||||
Total
|
$
|
(1,787
|
)
|
|
$
|
(131
|
)
|
$
|
(2,258
|
)
|
|
$
|
(446
|
)
|
1
|
The Company is required to record assets and liabilities that are held for sale at the lower of carrying value or fair value less any costs to sell based on the agreed-upon sale price. These losses related to refranchising activities in North America, which were calculated based on Level 3 inputs. Refer to Note 2.
|
|
Europe, Middle East & Africa
|
|
Latin
America |
|
North
America |
|
Asia Pacific
|
|
Bottling
Investments |
|
Corporate
|
|
Eliminations
|
|
Consolidated
|
|
||||||||
As of and for the three months ended June 30, 2017
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net operating revenues:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Third party
|
$
|
2,037
|
|
$
|
935
|
|
$
|
2,286
|
|
$
|
1,384
|
|
$
|
3,015
|
|
$
|
45
|
|
$
|
—
|
|
$
|
9,702
|
|
Intersegment
|
—
|
|
15
|
|
585
|
|
123
|
|
23
|
|
—
|
|
(746
|
)
|
—
|
|
||||||||
Total net revenues
|
2,037
|
|
950
|
|
2,871
|
|
1,507
|
|
3,038
|
|
45
|
|
(746
|
)
|
9,702
|
|
||||||||
Operating income (loss)
|
1,081
|
|
557
|
|
752
|
|
713
|
|
(652
|
)
|
(373
|
)
|
—
|
|
2,078
|
|
||||||||
Income (loss) before income taxes
|
1,111
|
|
559
|
|
655
|
|
716
|
|
(515
|
)
|
98
|
|
—
|
|
2,624
|
|
||||||||
Identifiable operating assets
|
5,409
|
|
1,787
|
|
17,423
|
|
2,340
|
|
8,157
|
|
34,027
|
|
—
|
|
69,143
|
|
||||||||
Noncurrent investments
|
1,330
|
|
880
|
|
110
|
|
168
|
|
16,035
|
|
3,480
|
|
—
|
|
22,003
|
|
||||||||
As of and for the three months ended July 1, 2016
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net operating revenues:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Third party
|
$
|
1,908
|
|
$
|
921
|
|
$
|
1,677
|
|
$
|
1,401
|
|
$
|
5,571
|
|
$
|
61
|
|
$
|
—
|
|
$
|
11,539
|
|
Intersegment
|
123
|
|
16
|
|
1,032
|
|
159
|
|
44
|
|
2
|
|
(1,376
|
)
|
—
|
|
||||||||
Total net revenues
|
2,031
|
|
937
|
|
2,709
|
|
1,560
|
|
5,615
|
|
63
|
|
(1,376
|
)
|
11,539
|
|
||||||||
Operating income (loss)
|
1,056
|
|
512
|
|
735
|
|
758
|
|
216
|
|
(418
|
)
|
—
|
|
2,859
|
|
||||||||
Income (loss) before income taxes
|
1,078
|
|
520
|
|
745
|
|
760
|
|
269
|
|
927
|
|
—
|
|
4,299
|
|
||||||||
Identifiable operating assets
|
4,765
|
|
1,990
|
|
16,706
|
|
2,381
|
|
19,023
|
|
31,730
|
|
—
|
|
76,595
|
|
||||||||
Noncurrent investments
|
1,399
|
|
743
|
|
112
|
|
161
|
|
11,716
|
|
3,368
|
|
—
|
|
17,499
|
|
||||||||
As of December 31, 2016
|
|
|
|
|
|
|
|
|
||||||||||||||||
Identifiable operating assets
|
$
|
4,067
|
|
$
|
1,785
|
|
$
|
16,566
|
|
$
|
2,024
|
|
$
|
15,973
|
|
$
|
29,606
|
|
$
|
—
|
|
$
|
70,021
|
|
Noncurrent investments
|
1,302
|
|
804
|
|
109
|
|
164
|
|
11,456
|
|
3,414
|
|
—
|
|
17,249
|
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$1 million
for Latin America, $
49 million
for North America,
$2 million
for Asia Pacific, $
10 million
for Bottling Investments and $
31 million
for Corporate due to the Company's productivity and reinvestment program. Operating income (loss) and income (loss) before income taxes were increased by
$6 million
for Europe, Middle East and Africa due to the refinement of previously established accruals related to the Company's productivity and reinvestment program. Refer to
Note 11
.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$44 million
for Bottling Investments due to costs incurred to refranchise certain of our bottling operations. Refer to
Note 2
and
Note 10
.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$653 million
for Bottling Investments and
$14 million
for Corporate due to asset impairment charges. Refer to
Note 1
and
Note 10
.
|
•
|
Income (loss) before income taxes was increased by
$38 million
for Bottling Investments and decreased by
$1 million
for Corporate due to the Company's proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees. Refer to
Note 10
.
|
•
|
Income (loss) before income taxes was reduced by
$109 million
for North America primarily related to payments made to convert the bottling agreements for certain North America bottling partners' territories to a single form of CBA with additional requirements. Refer to
Note 2
.
|
•
|
Income (loss) before income taxes was reduced by
$214 million
for Bottling Investments due to the refranchising of certain bottling territories in North America. Refer to
Note 2
.
|
•
|
Income (loss) before income taxes was increased by
$445 million
for Corporate due to a gain recognized resulting from the merger of CCW and CCEJ. Refer to
Note 10
.
|
•
|
Income (loss) before income taxes was increased by
$9 million
for Corporate due to a gain recognized upon refranchising a substantial portion of our China bottling operations. Refer to
Note 2
.
|
•
|
Income (loss) before income taxes was increased by
$25 million
for Corporate due to Coca-Cola FEMSA, an equity method investee, issuing additional shares of its stock during the period at a per share amount greater than the carrying value of the Company's per share investment.
|
•
|
Income (loss) before income taxes was reduced by
$26 million
for Corporate due to charges related to our former German bottling operations.
|
•
|
Income (loss) before income taxes was reduced by
$38 million
for Corporate due to the early extinguishment of long-term debt. Refer to
Note 6
.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$1 million
for Europe, Middle East and Africa, $
27 million
for North America, $
58 million
for Bottling Investments and $
21 million
for Corporate due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Operating income (loss) and income (loss) before income taxes were increased by
$1 million
for Latin America due to the refinement of previously established accruals related to the Company's productivity and reinvestment program. Refer to
Note 10
and
Note 11
.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$52 million
for Bottling Investments due to costs incurred to refranchise our North America bottling territories. Refer to
Note 2
and
Note 10
.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$8 million
for Bottling Investments and
$24 million
for Corporate related to noncapitalizable transaction costs associated with pending and closed transactions. Refer to
Note 10
.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$100 million
for Corporate as a result of a cash contribution to The Coca-Cola Foundation. Refer to
Note 10
.
|
•
|
Income (loss) before income taxes was reduced by
$199 million
for Bottling Investments due to the refranchising of certain bottling territories in North America. Refer to
Note 2
and
Note 10
.
|
•
|
Income (loss) before income taxes was reduced by
$15 million
for Bottling Investments and
$3 million
for Corporate due to the Company's proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees. Refer to
Note 10
.
|
•
|
Income (loss) before income taxes was increased by
$1,323 million
for Corporate as a result of the deconsolidation of our German bottling operations. Refer to
Note 2
.
|
|
Europe, Middle East & Africa
|
|
Latin
America |
|
North
America |
|
Asia Pacific
|
|
Bottling
Investments |
|
Corporate
|
|
Eliminations
|
|
Consolidated
|
|
||||||||
Six Months Ended June 30, 2017
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net operating revenues:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Third party
|
$
|
3,669
|
|
$
|
1,848
|
|
$
|
3,908
|
|
$
|
2,462
|
|
$
|
6,859
|
|
$
|
74
|
|
$
|
—
|
|
$
|
18,820
|
|
Intersegment
|
—
|
|
28
|
|
1,357
|
|
253
|
|
46
|
|
—
|
|
(1,684
|
)
|
—
|
|
||||||||
Total net revenues
|
3,669
|
|
1,876
|
|
5,265
|
|
2,715
|
|
6,905
|
|
74
|
|
(1,684
|
)
|
18,820
|
|
||||||||
Operating income (loss)
|
1,948
|
|
1,062
|
|
1,321
|
|
1,258
|
|
(762
|
)
|
(767
|
)
|
—
|
|
4,060
|
|
||||||||
Income (loss) before income taxes
|
1,996
|
|
1,066
|
|
1,128
|
|
1,265
|
|
(1,057
|
)
|
(267
|
)
|
—
|
|
4,131
|
|
||||||||
Six Months Ended July 1, 2016
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net operating revenues:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Third party
|
$
|
3,517
|
|
$
|
1,838
|
|
$
|
3,098
|
|
$
|
2,503
|
|
$
|
10,822
|
|
$
|
43
|
|
$
|
—
|
|
$
|
21,821
|
|
Intersegment
|
264
|
|
34
|
|
1,975
|
|
292
|
|
85
|
|
5
|
|
(2,655
|
)
|
—
|
|
||||||||
Total net revenues
|
3,781
|
|
1,872
|
|
5,073
|
|
2,795
|
|
10,907
|
|
48
|
|
(2,655
|
)
|
21,821
|
|
||||||||
Operating income (loss)
|
1,983
|
|
1,035
|
|
1,316
|
|
1,309
|
|
98
|
|
(741
|
)
|
—
|
|
5,000
|
|
||||||||
Income (loss) before income taxes
|
2,028
|
|
1,038
|
|
1,325
|
|
1,314
|
|
(163
|
)
|
651
|
|
—
|
|
6,193
|
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$1 million
for Latin America,
$84 million
for North America,
$3 million
for Asia Pacific,
$24 million
for Bottling Investments and
$118 million
for Corporate due to the Company's productivity and reinvestment program. Operating income (loss) and income (loss) before income taxes were increased by
$4 million
for Europe, Middle East and Africa due to the refinement of previously established accruals related to the Company's productivity and reinvestment program. Refer to
Note 11
.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$101 million
for Bottling Investments due to costs incurred to refranchise certain of our bottling operations. Refer to
Note 2
and
Note 10
.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$737 million
for Bottling Investments and
$34 million
for Corporate due to asset impairment charges. Refer to
Note 1
and
Note 10
.
|
•
|
Income (loss) before income taxes was reduced by
$4 million
for Europe, Middle East and Africa,
$15 million
for Bottling Investments and
$2 million
for Corporate due to the Company's proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees. Refer to
Note 10
.
|
•
|
Income (loss) before income taxes was reduced by
$215 million
for North America primarily related to payments made to convert the bottling agreements for certain North America bottling partners' territories to a single form of CBA with additional requirements. Refer to
Note 2
.
|
•
|
Income (loss) before income taxes was reduced by
$711 million
for Bottling Investments due to the refranchising of certain bottling territories in North America. Refer to
Note 2
.
|
•
|
Income (loss) before income taxes was increased by
$445 million
for Corporate due to a gain recognized resulting from the merger of CCW and CCEJ. Refer to
Note 10
.
|
•
|
Income (loss) before income taxes was increased by
$9 million
for Corporate due to a gain recognized upon refranchising a substantial portion of our China bottling operations. Refer to
Note 2
.
|
•
|
Income (loss) before income taxes was increased by
$25 million
for Corporate due to Coca-Cola FEMSA, an equity method investee, issuing additional shares of its stock during the period at a per share amount greater than the carrying value of the Company's per share investment.
|
•
|
Income (loss) before income taxes was reduced by
$26 million
for Corporate due to charges related to our former German bottling operations.
|
•
|
Income (loss) before income taxes was reduced by
$38 million
for Corporate due to the early extinguishment of long-term debt. Refer to Note 6.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$4 million
for Europe, Middle East and Africa,
$58 million
for North America,
$1 million
for Asia Pacific,
$278 million
for Bottling Investments and
$28 million
for Corporate due to the Company's productivity and reinvestment program as well as other restructuring initiatives. Operating income (loss) and income (loss) before income taxes were increased by
$1 million
for Latin America due to the refinement of previously established accruals related to the Company's productivity and reinvestment program. Refer to
Note 10
and
Note 11
.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$97 million
for Bottling Investments due to costs incurred to refranchise our North America bottling territories. Refer to
Note 2
and
Note 10
.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$8 million
for Bottling Investments and
$25 million
for Corporate related to noncapitalizable transaction costs associated with pending and closed transactions. Refer to
Note 10
.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by
$100 million
for Corporate as a result of a cash contribution to The Coca-Cola Foundation. Refer to
Note 10
.
|
•
|
Income (loss) before income taxes was reduced by
$568 million
for Bottling Investments due to the refranchising of certain bottling territories in North America. Refer to Note 2 and
Note 10
.
|
•
|
Income (loss) before income taxes was reduced by
$18 million
for Bottling Investments and
$3 million
for Corporate due to the Company's proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees. Refer to
Note 10
.
|
•
|
Income (loss) before income taxes was increased by
$1,323 million
for Corporate as a result of the deconsolidation of our German bottling operations. Refer to
Note 2
.
|
•
|
Income (loss) before income taxes was increased by
$18 million
for Corporate as a result of the disposal of our investment in Keurig. Refer to
Note 2
.
|
June 30, 2017
|
Estimated Fair
Value
|
|
Carrying
Value
|
|
Difference
|
|
|||
Monster Beverage Corporation
|
$
|
5,073
|
|
$
|
3,316
|
|
$
|
1,757
|
|
Coca-Cola FEMSA, S.A.B. de C.V.
|
4,838
|
|
1,699
|
|
3,139
|
|
|||
Coca-Cola European Partners plc
|
3,577
|
|
3,483
|
|
94
|
|
|||
Coca-Cola HBC AG
|
2,474
|
|
1,190
|
|
1,284
|
|
|||
Coca-Cola Amatil Limited
|
1,534
|
|
702
|
|
832
|
|
|||
Coca-Cola Bottlers Japan Inc.
1
|
985
|
|
1,131
|
|
(146
|
)
|
|||
Coca-Cola İçecek A.Ş.
|
580
|
|
242
|
|
338
|
|
|||
Coca-Cola Bottling Co. Consolidated
|
568
|
|
119
|
|
449
|
|
|||
Embotelladora Andina S.A.
|
550
|
|
271
|
|
279
|
|
|||
Corporación Lindley S.A.
|
252
|
|
120
|
|
132
|
|
|||
Total
|
$
|
20,431
|
|
$
|
12,273
|
|
$
|
8,158
|
|
|
Percent Change 2017 versus 2016
|
|
||||||||
|
Three Months Ended June 30, 2017
|
|
Six Months Ended June 30, 2017
|
|
||||||
|
Unit Cases
1,2,3
|
|
Concentrate
Sales
4
|
|
|
Unit Cases
1,2,3
|
|
Concentrate
Sales
4
|
|
|
Worldwide
|
—
|
|
—
|
%
|
|
—
|
%
|
(1
|
)%
|
|
Europe, Middle East & Africa
|
3
|
%
|
5
|
%
|
5
|
3
|
%
|
2
|
%
|
8
|
Latin America
|
(2
|
)
|
(3
|
)
|
|
(3
|
)
|
(4
|
)
|
|
North America
|
—
|
|
3
|
|
6
|
—
|
|
1
|
|
9
|
Asia Pacific
|
1
|
|
4
|
|
7
|
1
|
|
2
|
|
10
|
Bottling Investments
|
(46
|
)
|
N/A
|
|
|
(37
|
)
|
N/A
|
|
|
5
|
After considering the impact of structural changes, concentrate sales volume for Europe, Middle East and Africa for the three months ended June 30, 2017 grew 3 percent.
|
6
|
After considering the impact of structural changes, concentrate sales volume for North America for the three months ended June 30, 2017 grew 1 percent.
|
7
|
After considering the impact of structural changes, concentrate sales volume for Asia Pacific for the three months ended June 30, 2017 was even.
|
8
|
After considering the impact of structural changes, concentrate sales volume for Europe, Middle East and Africa for the six months ended June 30, 2017 grew 1 percent.
|
|
Percent Change 2017 versus 2016
|
|||||||||
|
Volume
1
|
|
Acquisitions & Divestitures
|
|
Price, Product & Geographic Mix
|
|
Currency Fluctuations
|
|
Total
|
|
Consolidated
|
—%
|
|
(17
|
)%
|
3
|
%
|
(2
|
)%
|
(16)%
|
|
Europe, Middle East & Africa
|
3%
|
|
(1)%
|
|
3
|
%
|
(5
|
)%
|
—
|
|
Latin America
|
(3
|
)
|
(1
|
)
|
5
|
|
—
|
|
2
|
|
North America
|
1
|
|
2
|
|
4
|
|
—
|
|
6
|
|
Asia Pacific
|
—
|
|
—
|
|
(1
|
)
|
(3
|
)
|
(3
|
)
|
Bottling Investments
|
(2
|
)
|
(46
|
)
|
2
|
|
—
|
|
(46
|
)
|
•
|
Europe, Middle East and Africa — favorably impacted as a result of pricing initiatives, product and package mix, and geographic mix;
|
•
|
Latin America — favorable price mix in all four of the segment's business units and the impact of inflationary environments in certain markets, partially offset by unfavorable geographic mix;
|
•
|
North America — favorably impacted as a result of pricing initiatives and product and package mix;
|
•
|
Asia Pacific — unfavorably impacted by geographic mix; and
|
•
|
Bottling Investments — favorably impacted as a result of pricing initiatives and product and package mix in North America, partially offset by unfavorable price mix in India.
|
|
Percent Change 2017 versus 2016
|
|||||||||
|
Volume
1
|
|
Acquisitions & Divestitures
|
|
Price, Product & Geographic Mix
|
|
Currency Fluctuations
|
|
Total
|
|
Consolidated
|
(1)%
|
|
(14
|
)%
|
3
|
%
|
(1
|
)%
|
(14)%
|
|
Europe, Middle East & Africa
|
1%
|
|
(2)%
|
|
3
|
%
|
(5
|
)%
|
(3)%
|
|
Latin America
|
(4
|
)
|
(1
|
)
|
6
|
|
—
|
|
—
|
|
North America
|
(1
|
)
|
2
|
|
3
|
|
—
|
|
4
|
|
Asia Pacific
|
—
|
|
—
|
|
(1
|
)
|
(3
|
)
|
(3
|
)
|
Bottling Investments
|
(3
|
)
|
(35
|
)
|
2
|
|
—
|
|
(37
|
)
|
•
|
Europe, Middle East and Africa — favorably impacted as a result of pricing initiatives, product and package mix, and geographic mix;
|
•
|
Latin America — favorable price mix in all four of the segment's business units and the impact of inflationary environments in certain markets, partially offset by unfavorable geographic mix;
|
•
|
North America — favorably impacted as a result of pricing initiatives and product and package mix;
|
•
|
Asia Pacific — unfavorably impacted by geographic mix; and
|
•
|
Bottling Investments — favorably impacted as a result of pricing initiatives and product and package mix in North America, partially offset by unfavorable price mix in India.
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||
|
June 30,
2017 |
|
July 1,
2016 |
|
|
June 30,
2017 |
|
July 1,
2016 |
|
||||
Stock-based compensation expense
|
$
|
59
|
|
$
|
50
|
|
|
$
|
114
|
|
$
|
119
|
|
Advertising expenses
|
985
|
|
1,002
|
|
|
1,883
|
|
1,905
|
|
||||
Selling and distribution expenses
1
|
838
|
|
1,355
|
|
|
1,919
|
|
2,751
|
|
||||
Other operating expenses
|
1,260
|
|
1,505
|
|
|
2,541
|
|
2,898
|
|
||||
Total
|
$
|
3,142
|
|
$
|
3,912
|
|
|
$
|
6,457
|
|
$
|
7,673
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||
|
June 30,
2017 |
|
July 1,
2016 |
|
|
June 30,
2017 |
|
July 1,
2016 |
|
||||
Europe, Middle East & Africa
|
$
|
(6
|
)
|
$
|
1
|
|
|
$
|
(4
|
)
|
$
|
4
|
|
Latin America
|
1
|
|
(1
|
)
|
|
1
|
|
(1
|
)
|
||||
North America
|
49
|
|
27
|
|
|
84
|
|
58
|
|
||||
Asia Pacific
|
2
|
|
—
|
|
|
3
|
|
1
|
|
||||
Bottling Investments
|
708
|
|
119
|
|
|
863
|
|
384
|
|
||||
Corporate
|
69
|
|
151
|
|
|
184
|
|
162
|
|
||||
Total
|
$
|
823
|
|
$
|
297
|
|
|
$
|
1,131
|
|
$
|
608
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||
|
June 30,
2017 |
|
July 1,
2016 |
|
|
June 30,
2017 |
|
July 1,
2016 |
|
Europe, Middle East & Africa
|
52.0
|
%
|
37.0
|
%
|
|
48.0
|
%
|
39.7
|
%
|
Latin America
|
26.8
|
|
17.9
|
|
|
26.2
|
|
20.7
|
|
North America
|
36.2
|
|
25.7
|
|
|
32.5
|
|
26.3
|
|
Asia Pacific
|
34.3
|
|
26.5
|
|
|
31.0
|
|
26.2
|
|
Bottling Investments
|
(31.3
|
)
|
7.5
|
|
|
(18.8
|
)
|
1.9
|
|
Corporate
|
(18.0
|
)
|
(14.6
|
)
|
|
(18.9
|
)
|
(14.8
|
)
|
Total
|
100.0
|
%
|
100.0
|
%
|
|
100.0
|
%
|
100.0
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||
|
June 30,
2017 |
|
July 1,
2016 |
|
|
June 30,
2017 |
|
July 1,
2016 |
|
Consolidated
|
21.4
|
%
|
24.8
|
%
|
|
21.6
|
%
|
22.9
|
%
|
Europe, Middle East & Africa
|
53.1
|
%
|
55.3
|
%
|
|
53.1
|
%
|
56.4
|
%
|
Latin America
|
59.6
|
|
55.6
|
|
|
57.5
|
|
56.3
|
|
North America
|
32.9
|
|
43.8
|
|
|
33.8
|
|
42.5
|
|
Asia Pacific
|
51.5
|
|
54.1
|
|
|
51.1
|
|
52.3
|
|
Bottling Investments
|
(21.6
|
)
|
3.9
|
|
|
(11.1
|
)
|
0.9
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
||||||||||||
|
June 30,
2017 |
|
|
July 1,
2016 |
|
|
June 30,
2017 |
|
|
July 1,
2016 |
|
|
||||
Asset impairments
|
$
|
(164
|
)
|
1
|
$
|
—
|
|
|
$
|
(164
|
)
|
1
|
$
|
—
|
|
|
Productivity and reinvestment program
|
(31
|
)
|
2
|
(24
|
)
|
8
|
(83
|
)
|
2
|
(45
|
)
|
8
|
||||
Other productivity, integration and restructuring initiatives
|
—
|
|
|
—
|
|
9
|
—
|
|
|
—
|
|
9
|
||||
Transaction gains and losses
|
707
|
|
3
|
26
|
|
10
|
533
|
|
4
|
(117
|
)
|
11
|
||||
Certain tax matters
|
(40
|
)
|
5
|
83
|
|
12
|
(70
|
)
|
5
|
77
|
|
12
|
||||
Other — net
|
(12
|
)
|
6
|
(45
|
)
|
13
|
(29
|
)
|
7
|
(46
|
)
|
14
|
1
|
Related to charges of
$667 million
and
$771 million
during the
three and six months ended
June 30, 2017
, respectively, due to the impairment of certain assets. Refer to
Note 10
and
Note 14
of Notes to Condensed Consolidated Financial Statements.
|
2
|
Related to charges of
$87 million
and
$226 million
during the
three and six months ended
June 30, 2017
, respectively. These charges were due to the Company's productivity and reinvestment program. Refer to
Note 11
of Notes to Condensed Consolidated Financial Statements.
|
3
|
Related to a net gain of
$82 million
which primarily consisted of a
$445 million
gain related to the merger of CCW and CCEJ, a
$25 million
gain related to Coca-Cola FEMSA, an equity method investee, issuing additional shares of its stock and a
$9 million
gain related to refranchising a substantial portion of our China bottling operations. These gains were partially offset by a net charge of
$214 million
as a result of the refranchising of certain bottling territories in North America, charges of
$109 million
primarily related to payments made to convert the bottling agreements for certain North America bottling partners' territories to a single form of CBA with additional requirements, a charge of
$44 million
related to costs incurred to refranchise certain of our bottling operations and a charge of
$26 million
related to our former German bottling operations. Refer to
Note 2
and
Note 10
of Notes to Condensed Consolidated Financial Statements.
|
4
|
Related to charges of
$583 million
which primarily consisted of
$711 million
of net charges as a result of the refranchising of certain bottling territories in North America, charges of
$215 million
primarily related to payments made to convert the bottling agreements for certain North America bottling partners' territories to a single form of CBA with additional requirements,
$101 million
related to costs incurred to refranchise certain of our bottling operations and a charge of
$26 million
related to our former German bottling operations. These charges were partially offset by a
$445 million
gain related to the merger of CCW and CCEJ, a
$25 million
gain related to Coca-Cola FEMSA, an equity method investee
,
issuing additional shares of its stock and a
$9 million
gain related to refranchising a substantial portion of our China bottling operations. Refer to
Note 2
and
Note 10
of Notes to Condensed Consolidated Financial Statements.
|
5
|
Related to
$29 million
and
$82 million
of excess tax benefits associated with the Company's share-based compensation arrangements during the three and six months ended June 30, 2017, respectively, and the tax benefit associated with the reversal of valuation allowances in certain of the Company's foreign jurisdictions both of which were partially offset by changes to our uncertain tax positions, including interest and penalties. The components of the net change in uncertain tax positions were individually insignificant.
|
•
|
$500 million
total principal amount of notes due May 25, 2022, at a fixed interest rate of
2.20 percent
;
|
•
|
$500 million
total principal amount of notes due May 25, 2027, at a fixed interest rate of
2.90 percent
;
|
•
|
€1,500 million
total principal amount of notes due March 8, 2019, at a variable interest rate equal to the three-month Euro Interbank Offered Rate ("EURIBOR") plus
0.25 percent
;
|
•
|
€500 million
total principal amount of notes due March 9, 2021, at a fixed interest rate of
0.00 percent
; and
|
•
|
€500 million
total principal amount of notes due March 8, 2024, at a fixed interest rate of
0.50 percent
.
|
•
|
$95.6 million
total principal amount o
f notes due August 15, 2019, at a fixed interest rate of
4.50 percent
;
|
•
|
$11.7 million
total principal amount of notes due September 15, 2022, at a fixed interest rate of
8.00 percent
;
|
•
|
$36.5 million
total principal amount of notes due September 15, 2023, at a fixed interest rate of
6.75 percent
;
|
•
|
$9.9 million
total principal amount of notes due October 1, 2026, at a fixed interest rate of
7.00 percent
;
|
•
|
$53.8 million
total principal amount of notes due November 15, 2026, at a fixed interest rate of
6.95 percent
;
|
•
|
$41.3 million
total principal amount of notes due September 15, 2028, at a fixed interest rate of
6.75 percent
;
|
•
|
$32.0 million
total principal amount of notes due October 15, 2036, at a fixed interest rate of
6.70 percent
;
|
•
|
$3.4 million
total principal amount of notes due March 18, 2037, at a fixed interest rate of
5.71 percent
;
|
•
|
$24.3 million
total principal amount of notes due January 15, 2038, at a fixed interest rate of
6.75 percent
; and
|
•
|
$4.7 million
total principal amount of notes due May 15, 2098, at a fixed interest rate of
7.00 percent
.
|
|
June 30,
2017 |
|
December 31, 2016
|
|
Increase
(Decrease)
|
|
|
Percent
Change
|
|
|||
Cash and cash equivalents
|
$
|
11,718
|
|
$
|
8,555
|
|
$
|
3,163
|
|
|
37
|
%
|
Short-term investments
|
11,016
|
|
9,595
|
|
1,421
|
|
|
15
|
|
|||
Marketable securities
|
4,490
|
|
4,051
|
|
439
|
|
|
11
|
|
|||
Trade accounts receivable — net
|
4,024
|
|
3,856
|
|
168
|
|
|
4
|
|
|||
Inventories
|
2,790
|
|
2,675
|
|
115
|
|
|
4
|
|
|||
Prepaid expenses and other assets
|
2,866
|
|
2,481
|
|
385
|
|
|
16
|
|
|||
Assets held for sale
|
2,057
|
|
2,797
|
|
(740
|
)
|
|
(26
|
)
|
|||
Equity method investments
|
20,845
|
|
16,260
|
|
4,585
|
|
|
28
|
|
|||
Other investments
|
1,158
|
|
989
|
|
169
|
|
|
17
|
|
|||
Other assets
|
4,318
|
|
4,248
|
|
70
|
|
|
2
|
|
|||
Property, plant and equipment — net
|
8,672
|
|
10,635
|
|
(1,963
|
)
|
|
(18
|
)
|
|||
Trademarks with indefinite lives
|
6,527
|
|
6,097
|
|
430
|
|
|
7
|
|
|||
Bottlers' franchise rights with indefinite lives
|
772
|
|
3,676
|
|
(2,904
|
)
|
|
(79
|
)
|
|||
Goodwill
|
9,449
|
|
10,629
|
|
(1,180
|
)
|
|
(11
|
)
|
|||
Other intangible assets
|
444
|
|
726
|
|
(282
|
)
|
|
(39
|
)
|
|||
Total assets
|
$
|
91,146
|
|
$
|
87,270
|
|
$
|
3,876
|
|
|
4
|
%
|
Accounts payable and accrued expenses
|
$
|
10,363
|
|
$
|
9,490
|
|
$
|
873
|
|
|
9
|
%
|
Loans and notes payable
|
14,355
|
|
12,498
|
|
1,857
|
|
|
15
|
|
|||
Current maturities of long-term debt
|
3,478
|
|
3,527
|
|
(49
|
)
|
|
(1
|
)
|
|||
Accrued income taxes
|
351
|
|
307
|
|
44
|
|
|
14
|
|
|||
Liabilities held for sale
|
283
|
|
710
|
|
(427
|
)
|
|
(60
|
)
|
|||
Long-term debt
|
31,805
|
|
29,684
|
|
2,121
|
|
|
7
|
|
|||
Other liabilities
|
4,092
|
|
4,081
|
|
11
|
|
|
—
|
|
|||
Deferred income taxes
|
4,330
|
|
3,753
|
|
577
|
|
|
15
|
|
|||
Total liabilities
|
$
|
69,057
|
|
$
|
64,050
|
|
$
|
5,007
|
|
|
8
|
%
|
Net assets
|
$
|
22,089
|
|
$
|
23,220
|
|
$
|
(1,131
|
)
|
1
|
(5
|
)%
|
•
|
Assets held for sale and liabilities held for sale decreased primarily due to North America and China bottling refranchising activities. Refer to Note 2 of Notes to Condensed Consolidated Financial Statements for additional information.
|
•
|
Equity method investments increased primarily due to our new investments in AC Bebidas and CCBJI. Refer to Note 2 and Note 10 of Notes to Condensed Consolidated Financial Statements for additional information.
|
•
|
Property, plant and equipment, bottlers' franchise rights with indefinite lives and goodwill decreased primarily as a result of additional North America bottling territories being refranchised or reclassified as held for sale as well as impairment charges recorded. Refer to Note 2 and Note 14 of Notes to Condensed Consolidated Financial Statements for additional information.
|
•
|
Accounts payable and accrued expenses increased primarily due to the Company's second quarter 2017 dividend payment, which was payable to shareowners of record as of June 15, 2017. This payment was made during the first week of July 2017.
|
•
|
Loans and notes payable increased due to commercial paper activity.
|
•
|
Deferred income taxes increased primarily due to the adoption of Accounting Standards Update ("ASU") 2015-17,
Balance Sheet Classification of Deferred Taxes.
Refer to Note 1 of Notes to Condensed Consolidated Financial Statements for additional information.
|
Period
|
Total Number
of Shares
Purchased
1
|
|
Average
Price Paid
Per Share
|
|
Total Number
of Shares
Purchased as
Part of the
Publicly
Announced
Plan
2
|
|
Maximum
Number of
Shares That May
Yet Be
Purchased Under
the Publicly
Announced
Plan
|
|
|
April 1, 2017 through April 28, 2017
|
3,047,873
|
|
$
|
42.93
|
|
3,047,510
|
|
120,076,548
|
|
April 29, 2017 through May 26, 2017
|
6,072,201
|
|
$
|
43.95
|
|
6,067,620
|
|
114,008,928
|
|
May 27, 2017 through June 30, 2017
|
12,406,189
|
|
$
|
45.35
|
|
12,406,189
|
|
101,602,739
|
|
Total
|
21,526,263
|
|
$
|
44.61
|
|
21,521,319
|
|
|
|
•
|
should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate;
|
•
|
may have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement;
|
•
|
may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and
|
•
|
were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments.
|
Exhibit No.
|
|
(With regard to applicable cross-references in the list of exhibits below, the Company's Current, Quarterly and Annual Reports are filed with the Securities and Exchange Commission (the "SEC") under File No. 001-02217; and Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Current, Quarterly and Annual Reports are filed with the SEC under File No. 001-09300).
|
|
3.1
|
|
3.2
|
|
4.1
|
As permitted by the rules of the SEC, the Company has not filed certain instruments defining the rights of holders of long-term debt of the Company or consolidated subsidiaries under which the total amount of securities authorized does not exceed 10 percent of the total assets of the Company and its consolidated subsidiaries. The Company agrees to furnish to the SEC, upon request, a copy of any omitted instrument.
|
4.2
|
|
4.3
|
|
4.4
|
|
4.5
|
|
4.6
|
|
4.7
|
|
4.8
|
|
4.9
|
|
4.10
|
|
4.11
|
|
4.12
|
|
4.13
|
|
4.14
|
|
4.15
|
|
4.16
|
|
4.17
|
|
4.18
|
|
4.19
|
|
4.20
|
4.21
|
|
4.22
|
|
4.23
|
|
4.24
|
|
4.25
|
|
4.26
|
|
4.27
|
|
4.28
|
|
4.29
|
|
4.30
|
|
4.31
|
|
4.32
|
|
4.33
|
|
4.34
|
Indenture, dated as of July 30, 1991, between Coca-Cola Refreshments USA, Inc. and Deutsche Bank Trust Company Americas, as trustee — incorporated herein by reference to Exhibit 4.1 to Coca-Cola Refreshments USA, Inc.’s Current Report on Form 8-K dated July 30, 1991.
|
4.35
|
First Supplemental Indenture, dated as of January 29, 1992, to the Indenture, dated as of July 30, 1991, between the Coca-Cola Refreshments USA, Inc. and Deutsche Bank Trust Company Americas, as trustee — incorporated herein by reference to Exhibit 4.01 to Coca-Cola Refreshments USA, Inc.’s Current Report on Form 8-K dated January 29, 1992.
|
4.36
|
|
10.1
|
|
10.2
|
|
10.3
|
|
10.4
|
|
10.5
|
|
10.6
|
|
10.7
|
|
12.1
|
|
31.1
|
|
31.2
|
32.1
|
|
101
|
The following financial information from The Coca-Cola Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Statements of Income for the three and six months ended June 30, 2017 and July 1, 2016, (ii) Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2017 and July 1, 2016, (iii) Condensed Consolidated Balance Sheets as of June 30, 2017 and December 31, 2016, (iv) Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2017 and July 1, 2016, and (v) Notes to Condensed Consolidated Financial Statements.
|
|
|
THE COCA-COLA COMPANY
(REGISTRANT)
|
|
|
|
|
|
/s/ LARRY M. MARK
|
Date:
|
July 27, 2017
|
Larry M. Mark
Vice President and Controller
(On behalf of the Registrant)
|
|
|
|
|
|
/s/ MARK RANDAZZA
|
Date:
|
July 27, 2017
|
Mark Randazza
Vice President, Assistant Controller and Chief Accounting Officer
(As Principal Accounting Officer)
|
Exhibit No.
|
|
(With regard to applicable cross-references in the list of exhibits below, the Company's Current, Quarterly and Annual Reports are filed with the Securities and Exchange Commission (the "SEC") under File No. 001-02217; and Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Current, Quarterly and Annual Reports are filed with the SEC under File No. 001-09300).
|
|
3.1
|
|
3.2
|
|
4.1
|
As permitted by the rules of the SEC, the Company has not filed certain instruments defining the rights of holders of long-term debt of the Company or consolidated subsidiaries under which the total amount of securities authorized does not exceed 10 percent of the total assets of the Company and its consolidated subsidiaries. The Company agrees to furnish to the SEC, upon request, a copy of any omitted instrument.
|
4.2
|
|
4.3
|
|
4.4
|
|
4.5
|
|
4.6
|
|
4.7
|
|
4.8
|
|
4.9
|
|
4.10
|
|
4.11
|
|
4.12
|
|
4.13
|
|
4.14
|
|
4.15
|
|
4.16
|
|
4.17
|
|
4.18
|
|
4.19
|
4.20
|
|
4.21
|
|
4.22
|
|
4.23
|
|
4.24
|
|
4.25
|
|
4.26
|
|
4.27
|
|
4.28
|
|
4.29
|
|
4.30
|
|
4.31
|
|
4.32
|
|
4.33
|
|
4.34
|
Indenture, dated as of July 30, 1991, between Coca-Cola Refreshments USA, Inc. and Deutsche Bank Trust Company Americas, as trustee — incorporated herein by reference to Exhibit 4.1 to Coca-Cola Refreshments USA, Inc.’s Current Report on Form 8-K dated July 30, 1991.
|
4.35
|
First Supplemental Indenture, dated as of January 29, 1992, to the Indenture, dated as of July 30, 1991, between the Coca-Cola Refreshments USA, Inc. and Deutsche Bank Trust Company Americas, as trustee — incorporated herein by reference to Exhibit 4.01 to Coca-Cola Refreshments USA, Inc.’s Current Report on Form 8-K dated January 29, 1992.
|
4.36
|
|
10.1
|
|
10.2
|
|
10.3
|
|
10.4
|
|
10.5
|
|
10.6
|
|
10.7
|
|
12.1
|
|
31.1
|
31.2
|
|
32.1
|
|
101
|
The following financial information from The Coca-Cola Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Statements of Income for the three and six months ended June 30, 2017 and July 1, 2016, (ii) Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2017 and July 1, 2016, (iii) Condensed Consolidated Balance Sheets as of June 30, 2017 and December 31, 2016, (iv) Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2017 and July 1, 2016, and (v) Notes to Condensed Consolidated Financial Statements.
|
Last Name
|
Fist Name
|
Amount of Monthly Benefit
|
Type of Annuity
|
Atkins
|
E. Ward
|
$1,235.50
|
Single Life Annuity
|
Crowe
|
Bobby D.
|
$1,172.64
|
Joint & 50% Contingent Annuity
|
Last Name
|
First Name
|
Amount of Flight Duty Credits
|
100% Vested or Years of Vesting Service Earned
|
|
|
|
|
Brinson
|
Sheldon
|
3
|
100
|
Clemons Jr.
|
Harry L.
|
2
|
100
|
Goodwin
|
Michael
|
2
|
100
|
Jablonski
|
Jeffrey M.
|
2
|
100
|
Martens
|
Michael H.
|
2
|
100
|
Miller
|
Mark
|
2
|
100
|
Shelby
|
Cassandra Ann
|
2
|
100
|
Tatum
|
Martin K.
|
2
|
100
|
Woodsides
|
Kenneth T.
|
3
|
100
|
JAMES R. QUINCEY
|
|
ADDRESS REPLY TO:
|
PRESIDENT AND CHIEF OPERATING OFFICER
|
|
PO BOX 1734
|
THE COCA-COLA COMPANY
|
|
ATLANTA, GA 30301
|
|
|
____________
|
|
|
1+404 676-4082
|
|
|
FAX: +1-404 676-7121
|
1.
|
You will step down from your current position as Senior Vice President and Chief People Officer, on April 30, 2017.
|
2.
|
You will no longer be on the Executive Committee and will cease to be an Executive Officer effective May 1, 2017 and will not be re-elected as a corporate officer.
|
3.
|
As we have discussed, we would like you to continue with the Company as executive human resource advisor through February 28, 2018. In this role, you will continue to work your normal schedule and assist with the transition of your responsibilities and related work as necessary and would separate on February 28, 2018 (“Separation Date”). The information in this letter assumes that you will continue this work and will sign the enclosed release by April 26, 2017. Otherwise, your Separation Date will be April 30, 2017.
|
4.
|
If you sign the enclosed release, you will be eligible for a benefit under The Coca-Cola Company Severance Pay Plan equivalent to two years of base salary, based on your current annual salary. This amount will be paid in a lump sum shortly after your Separation Date. This amount is subject to all applicable tax and withholdings.
|
5.
|
If you remain employed through December 31, 2017, you will receive an annual incentive award for 2017. The actual payment amount is contingent upon actual Company performance and your performance. Any award will be paid on or about March 15, 2018. Your participation and any award made to you shall be determined by the Compensation Committee.
|
6.
|
If you remain employed through February 28, 2018, you will receive an annual incentive award for 2018, prorated for two months. The actual payment amount is contingent upon actual Company performance and your performance. Any award will be paid on or about March 15, 2019. Your participation and any award made to you shall be determined by the Compensation Committee.
|
7.
|
You will be eligible for retiree health and welfare coverage. Enrollment information will be mailed to you shortly after your Separation Date and will provide information about your coverage options and the costs.
|
8.
|
All performance share unit (PSU) awards which you previously have received will be treated according to the terms of The Coca-Cola Company’s applicable restricted stock plans and programs as well as your related PSU Agreements. You are eligible for special treatment under the PSU agreements as summarized in the attachment to the Release. You will be personally liable for paying any taxes owed upon receipt of any award.
|
9.
|
All options you previously have received will be exercisable according to the terms of the Company’s applicable stock option plans and programs as well as your related Stock Option Grant Agreements. You are eligible for the Special Equity Program and the treatment of your options under this program is summarized in the attachment to the Release. When you exercise your vested stock options, you will be personally liable for paying any taxes owed on such exercises.
|
10.
|
You will not receive any additional equity grants.
|
11.
|
Your retirement benefits will consist of those benefits you have accrued under the standard terms and conditions of the plans in which you participate and in which benefits are vested as of your Separation Date.
|
12.
|
You will continue to be reimbursed up to $10,000 per year in financial planning and related expenses incurred by you annually up through your Separation Date.
|
13.
|
The Company will provide at its expense outplacement services through a designated services provider.
|
14.
|
The terms and conditions in this letter are further conditioned upon your signing and adhering to the attached Full and Complete Release and Agreement on Competition, Trade Secrets and Confidentiality by April 26, 2017.
|
a.
|
this Agreement is in exchange for continued employment with TCCC through the Separation Date, the Severance Payment, the special rights under the LTI Programs, and other good and valuable consideration to which I would otherwise not be entitled;
|
b.
|
the Company’s obligation to pay and my right to receive the Severance Payment and the special rights under the LTI Programs is subject to and conditioned upon my compliance with the covenants set forth in Sections 2 through 9 of this Agreement. In the event I breach any such covenant, the Company’s obligation to pay and my right to receive the Severance Payment and special rights under the LTI Programs will automatically terminate and I shall remain liable for damages hereto.
|
c.
|
I am hereby advised to consult with an attorney before signing this Agreement;
|
d.
|
I have 21 days from my receipt of this Agreement within which to consider whether to sign it. I may choose to sign this Agreement before the expiration of the 21-day consideration period, and if I choose to do so, I understand that I do so voluntarily. I agree that changes to this Agreement, whether material or immaterial, will not start the consideration period;
|
e.
|
I have seven days following my signature of this Agreement to revoke the Agreement; and
|
f.
|
this Agreement shall not become effective or enforceable until the revocation period of seven days has expired.
|
10.
|
Definitions
.
For purposes of this Agreement
|
|
|
|
THE COCA-COLA COMPANY
|
|
|
|
|
|
|
/s/ Ceree Eberly
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By:
/s/ Bernhard Goepelt
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CEREE EBERLY
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Name:
Bernhard Goepelt
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Title:
Senior Vice President and General Counsel
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Date: April 20, 2017
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Date: April 20, 2017
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1.
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The following States of the United States.
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2.
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The following Territories of the United States.
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3.
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Canada and Mexico,
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4.
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South America, Asia, Africa, Europe, and Australia and Oceania.
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Treatment
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Vested Stock Options
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Eligible employees have 4 years from termination date, or up to the option’s original expiration date, (whichever is earlier) to exercise vested options except as otherwise required by applicable law.
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Unvested Stock Options
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Eligible employees’ unvested options (held at least 12 months) will continue to vest for 4 years after termination, with such vesting schedule as originally set forth in the terms of the grant and applicable agreement, except as otherwise required by applicable law.
-Once vested, options must be exercised before the earlier of (i) 4 years from termination date, or (ii) the option’s original expiration date, except as otherwise required by applicable law. -Options held less than 12 months are forfeited. |
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x
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Eligible employees’ PSUs held at least 12 months will be prorated based on the number of months of service from the start of the performance period until the termination date, except as otherwise required by applicable law. A prorated number of PSUs, based on months of service during performance period and certified performance, will be released after the original holding period ends. Employee shall receive credit for full month of service as long as employee worked at least one day during that month.
-PSUs held less than 12 months are forfeited |
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Performance Cash
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Eligible employees’ Performance Cash awards held at least 12 months will be prorated based on the number of months of service from the start of the performance period until the termination date, except as otherwise required by applicable law. A prorated award, based on months of service during performance period and certified performance, will be released after the original holding period ends. Employee shall receive credit for full month of service as long as employee worked at least one day during that month.
-Performance Cash awards held less than 12 months are forfeited |
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Restricted Stock Units (RSUs) and Restricted Stock
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RSUs and Restricted Stock will continue to vest for up to 4 years from date of termination, with such vesting schedule as originally set forth in the terms of the grant and the applicable agreement, except as otherwise required by applicable law.
-Restricted Stock awards with original terms and conditions that result in forfeiture if the employee terminates for any reason other than death, disability or voluntary retirement are exempt from the Special Equity Program and special treatment hereunder. These awards result in forfeiture if the employee terminates involuntarily for any reason, other than death or disability, regardless of age and service. |
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JAMES R. QUINCEY
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ADDRESS REPLY TO:
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PRESIDENT AND CHIEF OPERATING OFFICER
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PO BOX 1734
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THE COCA-COLA COMPANY
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ATLANTA, GA 30301
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____________
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404 676-4082
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FAX: +1-404 676-7121
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1.
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You will step down from your current position as Senior Vice President, Chief Public Affairs & Communications Officer, on April 30, 2017.
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2.
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You will no longer be on the Executive Committee and will cease to be an Executive Officer effective May 1, 2017 and will not be re-elected as a corporate officer.
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3.
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As we have discussed, we would like you to continue with the Company as executive communications advisor through February 28, 2018. In this role, you will continue to work your normal schedule and assist with the transition of your responsibilities and related work as necessary and would separate on February 28, 2018 (“Separation Date”). The information in this letter assumes that you will continue this work and will sign the enclosed release by April 26, 2017. Otherwise, your Separation Date will be April 30, 2017.
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4.
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If you sign the enclosed release, you will be eligible for a benefit under The Coca-Cola Company Severance Pay Plan equivalent to two years of base salary, based on your current annual salary. This amount will be paid in a lump sum shortly after your Separation Date. This amount is subject to all applicable tax and withholdings.
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5.
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If you remain employed through December 31, 2017, you will receive your full annual incentive award for 2017. The actual payment amount is contingent upon actual Company performance and your performance. Any award will be paid on or about March 15, 2018. Your participation and any award made to you shall be determined by the Compensation Committee.
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6.
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If you remain employed through February 28, 2018, you will receive an annual incentive award for 2018, prorated for two months. The actual payment amount is contingent upon actual Company performance and your performance. Any award will be paid on or about March 15, 2019. Your participation and any award made to you shall be determined by the Compensation Committee.
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7.
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You will be eligible for retiree health and welfare coverage. Enrollment information will be mailed to you shortly after your Separation Date and will provide information about your coverage options and the costs.
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8.
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All performance share unit (PSU) awards which you previously have received will be treated according to the terms of The Coca-Cola Company’s applicable restricted stock plans and programs as well as your related PSU Agreements. You are eligible for special treatment under the PSU agreements as summarized in the attachment to the Release. You will be personally liable for paying any taxes owed upon receipt of any award.
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9.
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All options you previously have received will be exercisable according to the terms of the Company’s applicable stock option plans and programs as well as your related Stock Option Grant Agreements. You are eligible for the Special Equity Program and the treatment of your options under this program is summarized in the attachment to the Release. When you exercise your vested stock options, you will be personally liable for paying any taxes owed on such exercises.
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10.
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You will not receive any additional equity grants.
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11.
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Your retirement benefits will consist of those benefits you have accrued under the standard terms and conditions of the plans in which you participate and in which benefits are vested as of your Separation Date.
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12.
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You will continue to be reimbursed up to $10,000 per year in financial planning and related expenses incurred by you annually up through your Separation Date.
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13.
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The Company will provide at its expense outplacement services through a designated services provider.
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14.
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The terms and conditions in this letter are further conditioned upon your signing and adhering to the attached Full and Complete Release and Agreement on Competition, Trade Secrets and Confidentiality by April 26, 2017.
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a.
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this Agreement is in exchange for the payment of benefits under the Severance Plan, special rights under the LTI Programs, and other good and valuable consideration to which I would otherwise not be entitled;
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b.
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the Company’s obligation to pay and my right to receive the severance payment and special rights under the LTI Programs is subject to and conditioned upon my compliance with the covenants set forth in Sections 2 through 7 of this Agreement. In the event I breach any such covenant, the Company’s obligation to pay and my right to receive the severance payment and special rights under the LTI Programs will automatically terminate and I shall remain liable to damages hereto.
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c.
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I am hereby advised to consult with an attorney before signing this Agreement;
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d.
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I have 21 days from my receipt of this Agreement
within which to consider whether to sign it. I may choose to sign this Agreement before the expiration of the 21-day consideration period, and if I choose to do so, I understand that I do so voluntarily. I agree that changes to this Agreement, whether material or immaterial, will not start the consideration period;
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e.
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I have seven days following my signature of this Agreement to revoke the Agreement; and
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f.
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this Agreement shall not become effective or enforceable until the revocation period of seven days has expired.
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JAMES R. QUINCEY
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ADDRESS REPLY TO:
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PRESIDENT AND CHIEF EXECUTIVE OFFICER
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PO BOX 1734
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THE COCA-COLA COMPANY
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ATLANTA, GA 30301
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____________
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+1-404 676-9980
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FAX: +1-404 676-9980
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Your principal place of assignment will be Atlanta, Georgia. Your employer in Atlanta will be The Coca-Cola Company.
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Your annual base salary for your new position will be $550,000.
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You will continue to be eligible to participate in the annual Performance Incentive Plan. The target annual incentive for a Job Grade 21 is 100% of annual base salary. The actual amount of an incentive award may vary and is based on individual performance and the financial performance of the Company. Awards are made at the discretion of the Compensation Committee of the Board of Directors based upon recommendations by Senior Management. The plan may be modified from time to time.
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You will continue to be eligible to participate in The Coca-Cola Company’s Long-Term Incentive program. Awards are made at the discretion of the Compensation Committee of the Board of Directors based upon recommendations by Senior Management. You will be eligible to receive long-term incentive awards within guidelines for the job grade assigned to your position and based upon your personal performance, Company performance, and leadership potential to add value to the Company in the future. As a discretionary program, the award timing, frequency, size and mix of award vehicles are variable.
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You are expected to continue to maintain share ownership pursuant to the Company’s share ownership guidelines at a level equal to two times your base salary. You will be asked to provide information in December each year on your progress toward your ownership goal, and that information will be reviewed with the Compensation Committee of the Board of Directors the following February.
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You will continue to be eligible for the Company’s Financial Planning program which provides reimbursement of certain financial planning services, up to $10,000 at Job Grade 21 annually, subject to taxes and withholding.
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You will continue to be eligible for the Emory Executive Health benefit which includes a comprehensive physical exam and one-on-one medical and lifestyle management consultation.
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In addition to the standard relocation allowances pursuant to the Company’s policy, the Company will provide housing expenses, utility expenses, a car and driver, bank fee reimbursement, an environmental allowance, assignee choice points and home leave costs in Mexico through July 31, 2017, to the extent that the value of these benefits does not exceed $55,000. Should any of these expenses be paid through reimbursement to you, the reimbursement amount will be grossed up for taxes.
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If you have not done so already, you are required to enter into the Agreement on Confidentiality, Non-Competition, and Non-Solicitation, as well as the Agreement Covering Inventions, Discoveries, Copyrightable Material, Trade Secrets, and Confidential Information (enclosed).
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This letter is provided as information and does not constitute an employment contract.
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Six Months Ended June 30, 2017
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Year Ended December 31,
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2016
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2015
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2014
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2013
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2012
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(In millions except ratio)
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EARNINGS:
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Income from continuing operations before income taxes
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$
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4,131
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$
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8,136
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$
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9,605
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$
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9,325
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$
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11,477
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$
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11,809
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Fixed charges
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459
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804
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931
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569
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553
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486
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Less:
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Capitalized interest, net
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(2
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)
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(3
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)
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(1
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)
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(1
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)
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(1
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)
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(1
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)
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Equity (income) loss — net of dividends
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(303
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)
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(449
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)
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(122
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)
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(371
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)
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(201
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)
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(426
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)
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Adjusted earnings
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$
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4,285
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$
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8,488
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$
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10,413
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$
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9,522
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$
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11,828
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$
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11,868
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FIXED CHARGES:
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Gross interest incurred
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$
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425
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$
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736
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$
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857
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$
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484
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$
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464
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$
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398
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Interest portion of rent expense
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34
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68
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74
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85
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89
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88
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Total fixed charges
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$
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459
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$
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804
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$
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931
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$
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569
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$
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553
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$
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486
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Ratio of earnings to fixed charges
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9.3
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10.6
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11.2
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16.7
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21.4
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24.4
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1.
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I have reviewed this quarterly report on Form 10-Q of The Coca-Cola Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
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The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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Date:
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July 27, 2017
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/
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/ JAMES QUINCEY
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James Quincey
President and Chief Executive Officer of The Coca-Cola Company
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1.
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I have reviewed this quarterly report on Form 10-Q of The Coca-Cola Company;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
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The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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Date:
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July 27, 2017
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/
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/ KATHY N. WALLER
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Kathy N. Waller
Executive Vice President, Chief Financial Officer and President of Enabling Services of The Coca-Cola Company
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(1)
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to my knowledge, the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/
s
/ JAMES QUINCEY
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James Quincey
President and Chief Executive Officer of The Coca-Cola Company
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July 27, 2017
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/
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/ KATHY N. WALLER
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Kathy N. Waller
Executive Vice President, Chief Financial Officer and President of Enabling Services of The Coca-Cola Company
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July 27, 2017
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