By: Corey Leskanic, Mark Dowicz, Gabriella Grippa, DanielleTantillo

Letter to Shareholders Corey Leskanic (CEO)

Major Accomplishments 2012 Introduced 500-plus new products in 2012, including more than 100 low- and no-calorie choices Coca-Cola volume grew 3%-nearly 300 million unit cases (comparable to adding another Germany and two Russias) In 2012, we announced our new organizational structure of 3 operating businesses: Coca-Cola America, Coca-Cola International, and Bottle Investments Groups #1 Beverage company for environment, social, and governance performance by Goldman Sachs

2012 vs Revenue 2012 vs decreased $222 million Net income Growth 2012 vs Decreased $72 Million Stock Performance 2012 vs $25.78 Dec. 30, $31.73 Dec. 31, 2012 o increase 23%

2013 Growth Opportunities Emphasize core brands (Coca-Cola, Coca- Cola Light, Diet Coke, Coca-Cola Zero) o Coca-Cola Light 6.5% volume growth (growth in physical volume of sales) o Most popular, big potential growth Natural Sweeteners (new consumer preference)- stevia w/ Sprite & Vitamin Water Environment- Bottling

Business Review Mark Dowicz (COO)

Business Review New Products:  Ayataka (Green Tea)  I Lohas (Water)  Partnership with JBF INdustries Ltd.  Zico Coconut Water  Dasani Drops  Odwalla Smoothie Refreshers New Markets:

Business Review (continued) Competition Pepsico, Inc. Nestle S.A. Dr. Pepper Snapple Group Inc. Regulatory or Legal Issues Workers sue based on discrimination Discontinue Membership at American Legislative Exchange Council

Business Review (continued) Risks: Lack of popularity of many products Changing health consciousness attitude Health issues Commodity costs are rising

Income Statement Gabriella Grippa (CFO)

Something to keep in mind... sales of products are seasonal 2nd and 3rd quarters account for higher unit sales Earn more than 60% of operating income during 2nd and 3rd quarters

Revenue (in millions) Percent Decrease $8,284$8, %

Why did the company's revenue go down? Customer marketing programs o allowances o coupon programs Result: reduction in net sales ($1.0 billion in 2011 and 2012) Unfavorable currency exchange rate changes, impact of volume decline, bottle and can net pricing per case growth, challenging operating conditions, ongoing macroeconomic weakness

Cost of Revenue (in millions) Payments to licensors for marketing programs = reduction in cost of sales 2012 packaging costs per case grew due to increase cost of key raw materials like sugar Percent Decrease $5,254$5, %

Gross Margin Percentage & Expenses Percent Decrease 36.6%35.9%0.68% GDP % Operating Expenses

Operating Income (in millions) Percent Decrease $1,033$ %

Operating Income (continued)

Taxes (in millions) Increase French excise tax on beverages w/ added sweetener Tax rate reductions in UK and Sweden Tax law change in Belgium Decrease $196$160$36 21%19%2%

Net Income (in millions) Charges totaling $85 million related to restructuring activities Net mark-to-market losses totaling $4 million Tax benefit of $62 million from tax rate reductions in UK and Sweden, and tax law change in Belgium Percent Decrease $749$6779.6%

Earnings per Share (in millions) 2012 paid dividends of $187 million February 2012, increase dividend from $0.13 to $0.16 per share Percent Decrease $2.35$ %

Return on Investment (in millions) Became less efficient Decrease 10.4%8.8%1.6%

Balance Statement Danielle Tantillo (CFO)

Balance Sheet (continued)

Balance Sheet Up/ Down Current Assets2,7622,686Up Long Term Assets6,7486,408Up Current Liabilities2,5791,848Up Long Term Liabilities 4,2384,347Down Shareholders Equity2,6932,899Down Retained Earnings1,126638Up

Current Asset Cash increased (net income higher in 2011) Accounts Receivables (increased) Inventory- decreased ,7622,686

Long Term Assets Property, Plant, and Equipment ,7486,408

Long Term Assets (continued) Franchise License Intangible Assets and Goodwill ,7486,408

Current Liabilities Accounts Payable and Accrued Expenses ,5791,848

Current Liabilities Debt ,5791,848

Long Term Liabilities Long Term Debt ,2384,347

Shareholders Equity 339,064,025 shares of common stock Share Repurchases o 65 million shares (no more than $1.5 billion) o 2011: $1,014 million o 2012: $1,831 million ,6932,899

Retained Earnings Dividends $187 million Increased net income Bought back more common stock o 2012: 1,831 o 2011: 1, ,126638

Key Ratios better/ worse Current Ratio Worse Quick Ratio Worse Debt to Asset Ratio 36.5%33.12%Worse Time Covered Ratio Worse Inventory Turnover Worse Days Sales Outstanding Worse

Current Ratio current assets were barely larger than current liabilities o assets should be higher than liabilities o should be greater than one= IS NOT o the ratios show that at 1.07 in 2012 o Current debt increased $616 million dollars Ratio Interpretations

Quick Ratio Ability of current assets (without inventory) to cover the current liabilities. o Shows if coca-cola has the resources necessary to cover its current liabilities o Worse from > 1.24 to 0.92

Ratio Interpretations Debt to Asset Ratio Coca-cola's financial risk increased from 33.12% to 36.5% I o Increased debt over their assets o Debt increased by $616 million dollars. Times-Covered Ratio Decreased from to o Profits can still keep declining and they will still be able to meet interest charges

Ratio Interpretations Inventory Turnover Increased from to from 2011 to 2012 o cost of sales decrease from 2011 to 2012 o Inventory increased from 2011 to o Took longer to get rid of all the inventory Days Sales Outstanding Increased from in 2011 to in 2012 o Take longer to receive what customers owe