EXHIBIT 99.1
FOR IMMEDIATE RELEASE
CONTACT: Media: Ben Deutsch
(404) 676-2683
Investors: Larry M. Mark
(404) 676-8054
THE COCA-COLA COMPANY ANNOUNCES
THIRD QUARTER AND YEAR-TO-DATE 2003 RESULTS
* Reported earnings per share were $0.50 for the third quarter, as
compared with $0.44 in the prior year third quarter. Current quarter
results include a reduction of $0.01 per share related to the
previously announced streamlining initiatives and a $0.04 per share
non-cash charge related to the write down of assets in Latin America
by a bottling partner.
* Reported earnings per share were $1.39 for the first nine months, as
compared with $0.85 in the same period of the prior year.
* Worldwide unit case volume grew 4 percent in the third quarter and 4
percent on a year-to-date basis.
* Cash from operations for the first nine months increased 21 percent to
$4.1 billion and the Company expects strong cash flows to continue in
the future.
* The Company reaffirms its plan to repurchase approximately $1.5
billion of its stock in 2003.
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ATLANTA, Oct. 16, 2003 -- The Coca-Cola Company reported third quarter
earnings per share of $0.50, as compared with prior year third quarter earnings
of $0.44 per share. Current quarter results include a reduction of $0.01 per
share related to the previously announced streamlining initiatives and a $0.04
per share non-cash charge related to the write down of assets in Latin America
by an equity investee. Reported earnings per share for the first nine months
were $1.39, as compared with $0.85 in the same period of the prior year.
Worldwide unit case volume for the first nine months increased 4 percent, led by
5 percent growth in international operations and 2 percent growth in North
America.
The Company generated cash from operations of $4.1 billion during the first
nine months, compared to $3.4 billion in the prior year period. On a
year-to-date basis, the Company has repurchased $915 million of its common stock
and intends to repurchase approximately $1.5 billion of its stock for the full
year 2003. As strong cash flows are expected to continue into the future, the
Company anticipates accelerating its share repurchase levels over the next year.
The Company's results in the quarter benefited from 5 percent unit case
growth in international operations led by strong performance throughout Europe
and in many other countries including Mexico, China, Argentina and Thailand.
This strong performance was partially offset by weak beverage industry trends in
both Japan and India. In North America, unit case volume increased 1 percent in
the quarter, cycling very robust growth in the third quarter of the previous
year. Earnings in the quarter were favorably impacted by positive currency
trends and a lower effective tax rate, and were reduced by increased stock
option expense. In addition, earnings in the quarter were impacted by increased
costs associated with a recently resolved legal issue and key customer matter.
During the third quarter, unit case volumes were driven by 3 percent growth in
carbonated beverages and 9 percent growth in noncarbonated beverages.
Doug Daft, chairman and chief executive officer, said, "We continue to
improve our share position in many key markets around the world. Our priorities
for increasing profitable growth are clear: build our brands through excellent
marketing; improve the operational effectiveness of our entire system; and
relentless cost management."
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OPERATIONAL HIGHLIGHTS
- ----------------------
North America
- -------------
* Unit case sales in the third quarter increased 1 percent from the prior year,
cycling unit case growth of 9 percent during the third quarter of last year.
On a year-to-date basis, unit case growth increased 2 percent, cycling 6
percent growth in the prior year. Improved trends in the Foodservice and
Hospitality Division and consistent performance from the bottler-delivered
products were partially offset by industry-wide softness in the
warehouse-delivered juice category.
* The Coca-Cola system remains focused on maximizing value for the entire
category with a balanced price/volume approach. Throughout the quarter and
on a year-to-date basis, this strategy has resulted in the Company's bottling
partners recognizing consistent increases in retail price on carbonated soft
drinks.
* Year-to-date results in the Retail Division benefited from an increased cola
share position for Trademark Coca-Cola driven by contributions from Vanilla
Coke, diet Vanilla Coke, diet Coke, and the expansion of the Fridge Pack
availability. Further, Trademark Sprite has grown 7 percent year-to-date, led
by the introduction of Sprite Remix.
* The Company has captured increased value from the entire water category by
continuing to implement its three-tiered water strategy. Dasani grew by 16
percent in the quarter while continuing to maintain a strong price premium
within the water category. The Company remains focused on enhancing value in
the water category with a strategy to maintain rational pricing and to
continue differentiating through a variety of brand, package and channel
offerings.
* Powerade generated growth of 21 percent in the quarter and 17 percent on a
year-to-date basis led by solid marketing programs and the expansion of the
category. Although the overall juice industry trends remained soft in the
quarter, the Company benefited from the national roll-out of Simply Orange.
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Europe, Eurasia and Middle East
- -------------------------------
* Unit case volume increased 9 percent in the third quarter and increased 6
percent for the first nine months. Third quarter results were led by strong
growth in France, Spain, Great Britain and Italy. Germany delivered positive
growth of 4 percent in the quarter, demonstrating the successful management
of the package trends resulting from the mandatory deposit law change.
* During the quarter, the Company benefited from sound business fundamentals
and innovation, as well as strong marketing strategies coupled with the
benefit of favorable weather trends in key West European markets in July and
August.
* Unit case growth in the quarter was driven by core carbonated soft drinks
with Trademark Coca-Cola growing at 5 percent, Fanta at 4 percent, and 8
percent growth in Trademark Sprite. These brands benefited from innovations
such as Coke Light with Lemon, Vanilla Coke, Sprite Ice Cube, Sprite Zero,
and new proprietary packaging and flavors for Fanta. In addition,
noncarbonated beverages continue to grow strongly with expansion into new
categories and the profitable acceleration of growth in the Company's
existing business. In the quarter, Powerade increased 71 percent, juices and
juice drinks grew 21 percent and energy drinks increased 84 percent.
* In Great Britain, unit cases grew 8 percent in the quarter and 7 percent
year-to-date. Trademark Coca-Cola grew 9 percent during the quarter, driven
by the launch of Vanilla Coke. Noncarbonated beverages grew 9 percent in the
quarter led by Powerade, water and our juice brands.
* In Spain, unit case volume increased 11 percent in the third quarter, led by
the highly profitable immediate consumption packages. Trademark Coca-Cola
increased 6 percent in the quarter and strong growth also occurred in Fanta
and Sprite, leading to volume and retail dollar share gains.
* The Central Europe, Eurasia and Middle East Group generated strong growth in
the quarter throughout the region, specifically in the Italy and Alpine
Division, Russia and in Southeast Europe. The performance was driven by
carbonated soft drink growth of 5 percent and strong increases in immediate
consumption packages.
* In Germany, unit case volume in the third quarter increased 4 percent versus
the prior year third quarter. Although the change in deposit law has created
a difficult
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environment for the industry, the Coca-Cola system remains well
positioned to take advantage of the move by German consumers back to
returnable packaging.
Asia
- ----
* Unit case volume increased 1 percent for the quarter, cycling 9 percent
growth in the prior year third quarter. For the first nine months, unit case
volume increased 4 percent, cycling 11 percent growth during the prior year
period. Unit case volume trends in the third quarter were affected by weaker
industry trends in both Japan and India.
* Results during the first nine months were led by growth in China, Australia,
Thailand and India. Core carbonated soft drinks continue to perform well,
particularly in single-serve packages, and the Company's successful
noncarbonated beverages continue to strengthen as local brands such as Qoo
are rolled out throughout the region.
* In China, unit case volume increased 24 percent during the third quarter,
cycling 13 percent growth from the prior year. Carbonated soft drinks
performed particularly well, with a swift post SARS recovery driven by
vigorous execution of numerous sales and marketing programs across the entire
brand portfolio. In addition, an affordability strategy has driven returnable
glass bottle growth of approximately 30 percent in the towns and rural areas
where it has been launched.
* In Japan, unit case volume declined 6 percent in the third quarter with cool
and wet weather in July and August, followed by solid growth during the month
of September. Looking forward, the Company will continue to focus on
profitable growth in Japan with marketing, packaging and product initiatives
in all key beverage categories, as well as initiatives to continue enhancing
the cost structure of the bottling system. Effective October 1, 2003, the
Company and all of its bottling partners in Japan created a nationally
integrated supply chain management company to centralize procurement,
production, and logistics operations for the entire Coca-Cola system in
Japan.
* In India, the beverage industry was impacted by false accusations that soft
drinks contained high levels of pesticides. As a result, the Company's unit
case volume declined during the quarter, following several consecutive
quarters of strong double digit-growth. Following the accusations, the
Company reacted quickly and took
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steps to provide facts to the Indian government and to consumers to reassure
them of the safety of the Company's products. Looking forward, even though
unit case volume trends have stabilized over the past few weeks, the Company
continues to monitor the situation carefully.
Latin America
- -------------
* Unit case volume increased 5 percent in the third quarter and 5 percent for
the first nine months, led by strong growth in Mexico and Argentina,
partially offset by volume softness in Brazil relating to a system margin
improvement strategy.
* Mexico unit case volume grew 10 percent in the third quarter and 12 percent
during the first nine months. Performance in the third quarter benefited from
carbonated beverage growth of 4 percent, resulting from packaging
innovations, new flavor introductions and the effect of the Real marketing
platform. Double-digit growth in flavored carbonated soft drinks was led by
flavor extensions and package initiatives surrounding Fanta, Sprite, Lift and
Fresca. In the fast-growing water category, the Company is benefiting from
national marketing programs behind Ciel, the continued expansion of
single-serve water packages, and the availability of Ciel in former Risco
brand territories.
* In Argentina, unit case volume grew 12 percent in the third quarter and 12
percent year-to-date, reflecting the Company's long-term strategy of
investing in the country during last year's economic crisis. Trademark
Coca-Cola increased 15 percent in the third quarter through strong consumer
activities and an emphasis on refillable packaging, which also continues to
be expanded to Fanta and Sprite.
* In Brazil, unit case volume declined 4 percent in the quarter and 6 percent
year-to-date as a result of a greater focus on balancing volume growth with
margin expansion to create value for the Coca-Cola system. The Company is
working in a strong partnership with its bottlers to offer new packages, in
both refillable and one-way presentations, to provide greater choice to
consumers and allow our system to tailor customer options based on channel
strategies to drive revenue and profit growth.
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Africa
- ------
* Unit case volume increased 5 percent for the quarter. For the first nine
months, unit case volume increased 4 percent, cycling 7 percent growth during
the prior year period.
* Results in the North and West Africa Division benefited from strong growth in
the North African countries of Morocco and Algeria resulting from improved
bottler execution and marketing initiatives surrounding Trademark Coca-Cola
and Fanta. In Egypt, Trademark Coca-Cola increased 16 percent in the quarter.
In Nigeria, the second largest market in Africa, the Company has focused on
price realization in the marketplace to improve the overall profitability for
the Company and its bottling partners.
* Performance in the Southern and East Africa Division was impacted mainly by
the uncertain economic and political conditions in Zimbabwe. Within South
Africa, the Company's largest market in Africa, Trademark Coca-Cola grew 3
percent and Fanta grew 6 percent in the quarter. Results were driven by the
introduction of the Real campaign, a tie-in with the Pop Stars television
series, the successful launch of Vanilla Coke, the roll-out of 300 ml
returnable glass bottles, and solid local execution by our bottling partners.
* Throughout Africa, the Company continues to invest and focus on business
fundamentals to drive profitable volume for the system. These initiatives
include new cold outlet creation, improvements in market execution and
availability and affordable packaging.
FINANCIAL REVIEW
- ----------------
Third quarter reported earnings per share for the current and prior year
were $0.50 and $0.44, respectively. Year-to-date reported earnings per share for
the current and prior year were $1.39 and $0.85, respectively. The individual
impact of certain items on earnings per share is summarized as follows:
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- ----------------------------------------------------------------------------------------------
Income (Expense) Per Share
--------------------------
Nine Months Ended
Third Quarter September 30,
------------- -----------------
2003 2002 2003 2002
---- ---- ---- ----
ITEMS IMPACTING RESULTS:
- -----------------------
Streamlining Initiatives ($ 0.01) ($ 0.07)
Non-Cash Charge - Primarily Related to
Investments in Latin America ($ 0.04) ($ 0.01) ($ 0.04) ($ 0.07)
Gain on Litigation Settlement $ 0.01
Gain on Sale of Kaiser $ 0.01
Cumulative Effect of Adopting SFAS 142 -
Goodwill and Other Intangible Assets ($ 0.37)
-----------------------------------------------------
($ 0.05) ($ 0.01) ($ 0.10) ($ 0.43)
======== ======= ======== ========
- ------------------------------------------------------------------------------------------------
Operating Results
- -----------------
Revenues for the third quarter increased 6 percent, reflecting an increase
in gallon shipments of 4 percent, improving pricing of concentrate, and positive
currency trends. Revenues for the first nine months increased 7 percent. The
following reflects net operating revenues from the Company's operations:
- ------------------------------------------------------------------------------------------------
(in millions)
Nine Months Ended
Third Quarter September 30,
------------- -----------------
2003 2002 2003 2002
---- ---- ---- ----
Company Operations, Excluding Bottling $ 4,967 $ 4,684 $ 13,783 $ 12,921
Company-Owned Bottling Operations 695 638 2,068 1,848
----------------------------------------------
Consolidated Net Operating Revenues $ 5,662 $ 5,322 $ 15,851 $ 14,769
- ------------------------------------------------------------------------------------------------
Cost of goods sold on a year-to-date basis increased at a rate greater than
revenues, reflecting the consolidation of lower margin bottling operations and
the inclusion of the Evian and Danone water transactions, partially offset by
the gain related to a litigation settlement.
Selling, general and administrative expenses increased 12 percent in the
third quarter as a result of the timing of marketing expenses and increased
stock options expense. In addition, earnings in the quarter were reduced by
approximately $0.01 per
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share as a result of increased costs associated with a recently resolved legal
issue and key customer matter. For the first nine months, selling, general and
administrative expenses increased 7 percent, reflecting increases related to
structural changes and the Evian and Danone water transactions, partially offset
by the tight management of operating expenses. As a result of the Company's
policy to expense stock options, stock-based compensation expense increased by
$9 million during the quarter and $41 million during the first nine months.
Reported operating income was similar to the prior year third quarter,
reflecting the negative impact of the other operating charges ($55 million) and
increased stock-based compensation expense ($9 million increase). On a
year-to-date basis, operating income declined 1 percent, which included the
negative impact of the other operating charges ($284 million), increased
stock-based compensation expense ($41 million increase) and the positive effect
of a first quarter litigation settlement ($52 million).
Currencies positively impacted operating income in the quarter by
approximately 2 percent, as a result of the strength in the Euro, partially
offset by less attractive year-over-year hedge rates on the Japanese Yen and
weakness in Latin American currencies. For the first nine months, currencies
benefited operating income by approximately 2 percent.
Equity income for the third quarter declined from the prior year as a
result of a charge related to the write down of assets in Latin America by an
equity investee (described below). Underlying equity income trends continue to
demonstrate that current business strategies are leading to overall improving
health of the Coca-Cola bottling system around the world.
Effective Tax Rate
- ------------------
During the quarter, the Company's results benefited from a lower effective
tax rate than previously indicated. In July, the Company anticipated that its
underlying effective tax rate on operations would be approximately 24 percent
for the full year. The Company now anticipates that the underlying effective tax
rate for the full year 2003 will be approximately 22 percent primarily because
of the continued strong profit contributions from lower taxed locations where
currencies are having a favorable impact.
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The Company is required to record income tax expense for the first nine
months based on the estimated effective tax rate for the full year. To achieve
this result, the Company recorded income tax expense at an underlying effective
tax rate of approximately 18 percent in the third quarter. The decline in the
tax rate as compared to the rate previously communicated in the second quarter
resulted in a benefit of approximately $0.03 per share in the third quarter.
For the fourth quarter, the underlying effective tax rate is expected to be
approximately 22 percent. Looking into next year and for the foreseeable future,
based on current tax laws, the Company's effective tax rate on operations is
expected to be no more than 25.5 percent, which is consistent with previous
Company estimates.
The reported tax rates for the third quarter and first nine months were 18
percent and 22 percent, respectively, reflecting the underlying effective tax
rate on operations, the impact of higher tax rates related to the streamlining
initiatives, and the impact of the charge related to the write down of assets in
Latin America by an equity investee.
Charge Related to the Write Down of Assets in Latin America by an Equity
Investee
- ------------------------------------------------------------------------
Effective May 6, 2003, one of the Company's equity method investees,
Coca-Cola FEMSA, S.A. de C.V. (Coca-Cola FEMSA) consummated a merger with
another of the Company's equity method investees, Panamerican Beverages, Inc.
(Panamco). The Coca-Cola Company received new Coca-Cola FEMSA shares in exchange
for all Panamco shares previously held by the Company and, as a result, the
Company's ownership interest in Coca-Cola FEMSA increased from 30 percent to
39.6 percent. This exchange of shares was treated as a non-monetary exchange of
similar productive assets, and no gain was recorded by the Company as a result
of this merger.
In connection with the merger, Coca-Cola FEMSA management initiated steps
to streamline and integrate the operations. This process includes the closing of
various distribution centers and manufacturing plants. Furthermore, due to the
challenging economic conditions and uncertain political situation in Venezuela,
certain intangible assets were determined to be impaired and written down to
their fair market value. During the third quarter, the Company recorded a
non-cash charge of approximately $107 million pre-tax ($104 million after tax or
$0.04 per share), primarily reflected in equity income.
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Streamlining Initiatives
- ------------------------
During the first quarter of 2003, the Company initiated steps to streamline
and simplify its operations, primarily in North America and Germany. In North
America, the Company is integrating the operations of its three separate North
American business units -- Coca-Cola North America, Minute Maid, and Fountain.
In Germany, Coca-Cola Erfrischungsgetraenke AG (CCEAG) is taking steps to
improve its efficiency in sales, distribution and manufacturing. These
initiatives have resulted in a third quarter charge of $43 million pre-tax ($31
million after-tax or $0.01 per share) and a year-to-date charge of $272 million
pre-tax ($177 million after-tax or $0.07 per share).
The streamlining initiatives for the full-year 2003 are expected to result
in a charge to earnings of approximately $500 million on a pre-tax basis. The
Company continues to take steps to improve its overall efficiency and
effectiveness which has resulted in a higher than previously communicated charge
and associated benefits.
Creation of a Supply Chain Management Company in Japan
- ------------------------------------------------------
Effective October 1, 2003, the Company and all of its bottling partners in
Japan created a nationally integrated supply chain management company to
centralize procurement, production, and logistics operations for the entire
Coca-Cola system in Japan. The resources generated from this effort will be
invested in marketing activities and customer service programs to enhance the
long-term growth of the Coca-Cola system in Japan.
As a result of the creation of the supply chain management company in
Japan, a portion of The Coca-Cola Company's business has essentially been
converted from a finished product business model to a concentrate business
model. This will affect certain line items of the Company's income statement
over the next year, but will not impact the Company's underlying operating
income.
Beginning in the fourth quarter of 2003, the shift of certain products to a
concentrate business model will result in a reduction of revenues and cost of
goods sold for the same amount, thus having no impact on the Company's gross
profit or operating profit levels. Beginning October 1, 2003, Net Operating
Revenues and Cost of Goods Sold are both expected to decrease by approximately
$1.0 billion on an annualized basis.
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Conference Call
- ---------------
The Company will host a conference call with financial analysts to discuss
the third quarter and year-to-date 2003 results on October 16, 2003, at 8:30
a.m. (EDT). The Company invites investors to listen to the live audiocast of the
conference call at the Company's website, www.coca-cola.com in the "investors"
section. Further, the "investors" section of the Company's website includes a
disclosure and reconciliation of non-GAAP financial measures that may be used
periodically by management when discussing the Company's financial results with
investors and analysts.
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THE COCA-COLA COMPANY AND SUBSIDIARIES
--------------------------------------
Condensed Consolidated Statements of Income
-------------------------------------------
(UNAUDITED)
(In millions, except per share data)
Three Months Ended
September 30,
---------------------------------
2003 2002 % Change
---- ---- --------
NET OPERATING REVENUES $ 5,662 $ 5,322 6
Cost of goods sold 2,150 2,083 3
------- -------
GROSS PROFIT 3,512 3,239 8
Selling, general and administrative expenses
(includes $104 in 2003 and $95 in 2002
related to the impact of the adoption of
the fair value method of accounting for
stock-based compensation) 2,006 1,789 12
Other operating charges 55 -- --
------- -------
OPERATING INCOME 1,451 1,450 0
Interest income 37 46 (20)
Interest expense 42 52 (19)
Equity income 86 113 (24)
Other income (loss) - net (42) (62) --
Gains on issuances of stock by equity investees 8 -- --
------- -------
INCOME BEFORE INCOME TAXES 1,498 1,495 0
Income taxes 275 404 (32)
------- -------
NET INCOME $ 1,223 $ 1,091 12
======= =======
DILUTED NET INCOME PER SHARE* $ 0.50 $ 0.44 14
======= =======
AVERAGE SHARES OUTSTANDING - DILUTED* 2,458 2,483 (1)
======= =======
- -----------
* For the third quarter, "Basic Net Income Per Share" was $0.50 for 2003 and
$0.44 for 2002 based on "Average Shares Outstanding - Basic" of 2,455 and
2,478 for 2003 and 2002, respectively.
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THE COCA-COLA COMPANY AND SUBSIDIARIES
--------------------------------------
Condensed Consolidated Statements of Income
-------------------------------------------
(UNAUDITED)
(In millions, except per share data)
Nine Months Ended
September 30,
---------------------------------
2003 2002 % Change
---- ---- --------
NET OPERATING REVENUES $ 15,851 $ 14,769 7
Cost of goods sold 5,865 5,404 9
-------- --------
GROSS PROFIT 9,986 9,365 7
Selling, general and administrative expenses
(includes $323 in 2003 and $282 in 2002
related to the impact of the adoption of
the fair value method of accounting for
stock-based compensation) 5,573 5,197 7
Other operating charges 284 -- --
-------- --------
OPERATING INCOME 4,129 4,168 (1)
Interest income 138 156 (12)
Interest expense 130 156 (17)
Equity income 325 350 (7)
Other income (loss) - net (99) (292) --
Gains on issuances of stock by equity investees 8 -- --
-------- --------
INCOME BEFORE INCOME TAXES AND CUMULATIVE
EFFECT OF ACCOUNTING CHANGE 4,371 4,226 3
Income taxes 951 1,180 (19)
-------- --------
NET INCOME BEFORE CUMULATIVE EFFECT OF
ACCOUNTING CHANGE 3,420 3,046 12
-------- --------
Cumulative effect of accounting change,
net of income taxes
SFAS 142: Company Operations -- (367) --
Equity Investees -- (559) --
-------- --------
NET INCOME $ 3,420 $ 2,120 61
======== ========
DILUTED NET INCOME PER SHARE BEFORE
CUMULATIVE EFFECT $ 1.39 $ 1.23 13
======== ========
DILUTED NET INCOME PER SHARE* $ 1.39 $ 0.85 64
======== ========
AVERAGE SHARES OUTSTANDING - DILUTED* 2,465 2,485 (1)
======== ========
- ----------
* For the first nine months, "Basic Net Income Per Share" was $1.39 for 2003
and $0.85 for 2002 based on "Average Shares Outstanding - Basic" of 2,462
and 2,479 for 2003 and 2002, respectively.
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THE COCA-COLA COMPANY AND SUBSIDIARIES
--------------------------------------
Condensed Consolidated Balance Sheets
-------------------------------------
(UNAUDITED)
(In millions, except share data)
ASSETS
September 30, 2003 December 31, 2002
------------------ -----------------
CURRENT ASSETS
Cash and cash equivalents $ 3,656 $ 2,126
Marketable securities 191 219
-------- --------
3,847 2,345
Trade accounts receivable, less allowances
of $60 in 2003 and $55 in 2002 2,142 2,097
Inventories 1,293 1,294
Prepaid expenses and other assets 1,762 1,616
-------- --------
TOTAL CURRENT ASSETS 9,044 7,352
-------- --------
INVESTMENTS AND OTHER ASSETS
Equity method investments
Coca-Cola Enterprises Inc. 1,234 972
Coca-Cola Hellenic Bottling Company S.A. 1,010 872
Coca-Cola FEMSA, S.A. de C.V. 716 347
Coca-Cola Amatil Limited 572 492
Other, principally bottling companies 1,576 2,054
Cost method investments,
principally bottling companies 283 254
Other assets 2,953 2,694
-------- --------
8,344 7,685
-------- --------
PROPERTY, PLANT AND EQUIPMENT
Land 396 385
Building and improvements 2,495 2,332
Machinery and equipment 6,252 5,888
Containers 385 396
-------- --------
9,528 9,001
Less allowances for depreciation 3,464 3,090
-------- --------
6,064 5,911
-------- --------
TRADEMARKS WITH INDEFINITE LIVES 1,867 1,724
GOODWILL AND OTHER INTANGIBLE ASSETS 2,088 1,829
-------- --------
$ 27,407 $ 24,501
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THE COCA-COLA COMPANY AND SUBSIDIARIES
--------------------------------------
Condensed Consolidated Balance Sheets
-------------------------------------
(UNAUDITED)
(In millions, except share data)
LIABILITIES AND SHARE-OWNERS' EQUITY
September 30, 2003 December 31, 2002
------------------ -----------------
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 4,663 $ 3,692
Loans and notes payable 2,762 2,475
Current maturities of long-term debt 307 180
Accrued income taxes 859 994
-------- --------
TOTAL CURRENT LIABILITIES 8,591 7,341
-------- --------
LONG-TERM DEBT 2,479 2,701
-------- --------
OTHER LIABILITIES 2,415 2,260
-------- --------
DEFERRED INCOME TAXES 397 399
-------- --------
SHARE-OWNERS' EQUITY
Common Stock, $.25 par value
Authorized: 5,600,000,000 shares
Issued: 3,493,232,231 shares in 2003;
3,490,818,627 shares in 2002 873 873
Capital surplus 4,251 3,857
Reinvested earnings 26,300 24,506
Accumulated other comprehensive income (2,574) (3,047)
-------- --------
28,850 26,189
Less treasury stock, at cost
(1,041,846,089 shares in 2003;
1,019,839,490 shares in 2002) 15,325 14,389
-------- --------
13,525 11,800
-------- --------
$ 27,407 $ 24,501
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THE COCA-COLA COMPANY AND SUBSIDIARIES
--------------------------------------
Condensed Consolidated Statements of Cash Flows
-----------------------------------------------
(UNAUDITED)
(In millions)
Nine Months Ended
September 30,
------------------------------
2003 2002
---- ----
OPERATING ACTIVITIES
Net income $ 3,420 $ 2,120
Depreciation and amortization 622 599
Stock-based compensation expense 329 311
Deferred income taxes (69) (131)
Equity income or loss, net of dividends (246) (252)
Foreign currency adjustments (121) (12)
Gains on issuances of stock by equity investees (8) --
Gains on sales of assets (22) (8)
Cumulative effect of accounting changes -- 926
Other operating charges 164 --
Other items 281 244
Net change in operating assets and liabilities (229) (392)
-------- --------
Net cash provided by operating activities 4,121 3,405
-------- --------
INVESTING ACTIVITIES
Acquisitions and investments,
principally trademarks and bottling
companies (306) (415)
Purchases of investments and other assets (190) (115)
Proceeds from disposals of investments and
other assets 172 277
Purchases of property, plant and equipment (565) (582)
Proceeds from disposals of property, plant and
equipment 54 55
Other investing activities 29 49
-------- --------
Net cash used in investing activities (806) (731)
-------- --------
FINANCING ACTIVITIES
Issuances of debt 1,121 1,402
Payments of debt (1,007) (1,939)
Issuances of stock 48 97
Purchases of stock for treasury (938) (478)
Dividends (1,086) (994)
-------- --------
Net cash used in financing activities (1,862) (1,912)
-------- --------
EFFECT OF EXCHANGE RATE CHANGES ON
CASH AND CASH EQUIVALENTS 77 19
-------- --------
CASH AND CASH EQUIVALENTS
Net increase during the period 1,530 781
Balance at beginning of period 2,126 1,866
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Balance at end of period $ 3,656 $ 2,647
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Page 18
THE COCA-COLA COMPANY
THIRD QUARTER AND YEAR-TO-DATE 2003
Unit Case Volume Results
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Unit Case Volume
(% Change)
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2003 vs. 2002
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Third Quarter Year-To-Date
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WORLDWIDE 4 4
INTERNATIONAL OPERATIONS 5 5
Latin America 5 5
Europe, Eurasia and Middle East 9 6
Africa 5 4
Asia 1 4
NORTH AMERICA OPERATIONS 1 2
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Page 19
THE COCA-COLA COMPANY
The Coca-Cola Company is the world's largest beverage company. Along with
Coca-Cola, recognized as the world's best-known brand, The Coca-Cola Company
markets four of the world's top five soft drink brands, including diet Coke,
Fanta and Sprite, and a wide range of other beverages, including diet and light
soft drinks, waters, juices and juice drinks, teas, coffees and sports drinks.
Through the world's largest distribution system, consumers in more than 200
countries enjoy the Company's beverages at a rate exceeding 1 billion servings
each day. For more information about The Coca-Cola Company, please visit our
website at www.coca-cola.com.
Forward-Looking Statements
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This press release may contain statements, estimates or projections that
constitute "forward-looking statements" as defined under U.S. federal securities
laws. Generally, the words "believe," "expect," "intend," "estimate,"
"anticipate," "project," "will" and similar expressions identify forward-looking
statements, which generally are not historical in nature. Forward-looking
statements are subject to certain risks and uncertainties that could cause
actual results to differ materially from The Coca-Cola Company's historical
experience and our present expectations or projections. These risks include, but
are not limited to, changes in economic and political conditions; changes in the
nonalcoholic beverages business environment, including actions of competitors
and changes in consumer preferences; product boycotts; foreign currency and
interest rate fluctuations; adverse weather conditions; the effectiveness of our
advertising and marketing programs; fluctuations in the cost and availability of
raw materials; our ability to achieve earnings forecasts; regulatory and legal
changes; our ability to penetrate developing and emerging markets; litigation
uncertainties; and other risks discussed in our Company's filings with the
Securities and Exchange Commission (the "SEC"), including our Annual Report on
Form 10-K, which filings are available from the SEC. You should not place undue
reliance on forward-looking statements, which speak only as of the date they are
made. The Coca-Cola Company undertakes no obligation to publicly update or
revise any forward-looking statements.
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