An American corporation and manufacturer founded in 1892, the Coca-Cola Company is the known as the largest beverage company in the world. The company’s primary product is the Coca-Cola, a sweetened carbonated beverage. Aside from the Coca-Cola, the company also produces and sells other soft drinks, citrus and energy drinks.This research paper provides essential information needed to assess the Coca-Cola Company. This paper studied the background of the company as well as its nature of the business and its objectives. The proponents used the MD ; A analysis method as basis in evaluating certain aspects and areas in the company. Also, the annual reports of the Coca-Cola Company play a vital role in the study conducted for it is the main source of most of the information.
By looking into the annual reports, the proponents could determine and analyze the company’s standing or status. Moreover, this study provides the company’s projection for the next year.The proponents hoped that this study would be useful and could be used as future reference.CHAPTER IIBACKGROUNDOut of Dr. John S.
Pemberton’s curiosity, it led him to formulate a carbonated drink that has its own unique taste. Then, he created a flavored syrup mixture with carbonated water. The name, “Coca-Cola” was created by his partner, Frank M. Robinson.Before passing away, Dr. Pemberton sold his business having the most of its portion sold to Asa G. Candler, an Atlanta Businessman.
It was Joseph Biedenharn’s desire to make the product more accessible and portable, he pioneered the beverage into its bottle content. Also, the demand of the beverage that time was massive. Five years later, three enterprising businessmen, namely Benjamin Thomas, Joseph Whitehead and John Lupton, secured exclusive rights to bottle and sell Coca-Cola. They are also the people behind the renowned worldwide bottle system of the company.The Company also suffered challenges such as the most common for bottlers, the imitations of the beverage by competitors.
They addressed this issue through an agreement stating that to differentiate one beverage to another, it should have a standard and distinctive bottle. In 1916, the new bottle of Coca-Cola was approved. It was so unique that it could be easily recognized which set it apart from the others. During 1977, the bottle of the beverage was been trademarked. Giving out of coupons for the drink was the first marketing tactics the company used. Followed by new prints advertisement and using its participating institutions as a distribution channel of promotional items.
The advertisements of the Coca-Cola caught the people’s attention. In 1970’s advertisements, its branding related to fun, friends and good times feeling. Also, the performance of Hilltop Singers singing “I’d Like to Buy the World a Coke” and the commercial “Have a Coke and a Smile”. During the 1980’s, they featured such memorable slogans as “Coke is It!”, “Catch the Wave” and “Can’t Beat the Feeling”. They also experiment with the use of computer animation, “Always Coca-Cola”.
This is a series of ad campaigns featuring animated polar bears which took 12 weeks to be able to produce from start to end. This campaign was a hit because of the bear’s embodiment of innocence, mischief and fun characteristics which struck the people.The 2009’s worldwide campaign, “Open Happiness”, was an invitation to all the people around the world. The campaign portrays a meaning message that people should have to take a break, quench the thirst with a Coca-Cola and continue to enjoy life’s satisfaction. After a successful 2009 campaign, it was the source of inspiration for the 2010’s Winter Olympics themed as “Open the Games. Open Happiness”.
The campaign was seen through different platforms such as stores, billboards, TV shows and print ads. Also, in 2016, they launched a social media campaign having the mission on finding what makes people happy. The “Expedition 2016” is composed of three happiness ambassadors who will travel around 206 countries within a year.Experts have long believed in the connection between happiness and wellness, and Coca Cola is proud to have played a part in happy occasions around the globe.
CHAPTER IIIMD&A ANALYSISThe Coca Cola Company, 2013The nature of business of the Coca Cola Company is that they own and market more than 500 beverages brands of nonalcoholic products including sparkling beverages and other variety of beverages such as waters, juices, energy drinks and many more. They are known as the world’s largest beverage company. Also, out of the world’s top 5 non-alcoholic soft drink, they own four namely – Coca-Cola, Diet Coke, Sprite and Fanta. The objective of the company is to use their formidable assets in achieving long-term growth. To achieve this objective, they have 5 strategic priorities which are as follows: 1). Accelerate sparkling growth, led by brand Coca-Cola, 2). Strategically expand our profitable still portfolio, 3) Increase media investments by maximizing productivity, 4).
Win at the point of sale by unlocking the power of the Coca-Cola system, 5). Invest in our next generation of leaders. Aside from these priorities, the company must enhance their core capabilities to be able to achieve their long-term growth objective and to become more competitive in the business.The company identified six categories of challenges and risks that could hinders the company’s growth and prosper the future, the following are as follows: 1).
Obesity, Poor Diets and Inactive Lifestyles, 2). Water Quality and Quantity, 3). Evolving Consumer Preferences, 4). Increased Competition and Capabilities, 5). Product Safety and Quality, 6). Food Security. Though they have identified these six issues, they believed that their company could addressed the issues properly and appropriately.The Coca Cola sold 28.
2 billion-unit cases in 2013 which is greater compare to the 27.7 billion-unit cases sold in 2012. In 2013, the company’s net operating revenue was $46,854 million which is lesser compare to the $48,017 million NOR in 2012. The adverse impact of the fluctuation of the foreign currency lessen the consolidated net operating revenues by 2 percent. The 2% decreased in the consolidated net operating profit was because of the adverse effect of the foreign currency fluctuation. In 2013, the selling, general and administrative expenses was $17,310 million compared to $17,738 million incurred in 2012 Due to the deconsolidation of the Philippines and Brazil bottling operations in 2013, the gross margin profit increased to 60.7% in 2013 from 60.
3% in 2012. In 2013, the cash flow from operating activities decreased $103 million. The pension expense is expected to decrease at least by $165 in 2014 compared to 2013.The company’s source of liquidity is their net cash from operations. They do not typically raise capital through the issuance of stock. They raise capital not through the issuance of stock but instead, they use alternative action which is through debt financing. The company’s primary cash requirements have historically been borrowing of fund domestically.
To back up their lines of credit which expires any time five years from now, they have a $6,410 million in lines of credit for the use in general corporate as of 2013. They provided a $10,542 million and $10,645 million, in 2013 and 2012, respectively. In 2013, the cash flow from operating activities decreased $103 million, or 1% compared to 2012. Due to increase in tax payments, result of the impact of foreign fluctuations and the deconsolidation of the Philippines and Brazil bottling operations.
The net cash used in investing activities were $11,404 million and $4,214 million for 2012 and 2013, respectively. Next year, the company expects to make significant value of cash flows.The Coca Cola Company, 2014The nature of business of the Coca Cola Company is that they own and market more than 500 beverages brands of nonalcoholic products including sparkling beverages and other variety of beverages such as waters, juices, energy drinks and many more. They are known as the world’s largest beverage company. Also, out of the world’s top 5 non-alcoholic soft drink, they own four namely – Coca-Cola, Diet Coke, Sprite and Fanta. The objective of the company is to use their formidable assets in achieving long-term growth. To achieve this objective, they have 5 strategic priorities which are as follows: 1). Accelerate sparkling growth, led by brand Coca-Cola, 2).
Strategically expand our profitable still portfolio, 3) Increase media investments by maximizing productivity, 4). Win at the point of sale by unlocking the power of the Coca-Cola system, 5). Invest in our next generation of leaders.
Aside from these priorities, the company must enhance their core capabilities to be able to achieve their long-term growth objective and to become more competitive in the business.The company identified six categories of challenges and risks that could hinders the company’s growth and prosper the future, the following are as follows: 1). Obesity, Poor Diets and Inactive Lifestyles, 2). Water Quality and Quantity, 3). Evolving Consumer Preferences, 4).
Increased Competition and Capabilities, 5). Product Safety and Quality, 6). Food Security. Though they have identified these six issues, they believed that their company could addressed the issues properly and appropriately.The Coca Cola sold 28.6 billion-unit cases in 2014 which is greater compare to the 28.2 billion-unit cases sold in 2013.
In 2014, the company’s net operating revenue was $45,998 million which is lesser compare to the $46,854 million NOR in 2013. It suffered a 2% decreased in its consolidated net operating profit because of the US dollar is stronger compared to other currencies. In 2014, the selling, general and administrative expenses was $17,218 million compared to $17,310 million incurred in 2013. The consolidated operating income of the company was 21.8% and 21.1%, in 2013 and 2014, respectively. This indicates that the company’s operating income is lesser than the previous year.
The company’s source of liquidity is their net cash from operations. They do not typically raise capital through the issuance of stock. They raise capital not through the issuance of stock but instead, they use alternative action which is through debt financing. The company’s primary cash requirements have historically been borrowing of fund domestically. To back up their lines of credit which expires any time five years from now, they have a $7,677 million in lines of credit for the use in general corporate as of 2014. The company provided a net cash of $10,542 million and $10,615 million, in 2013 and 2014, respectively. In 2014, the cash flow from operating activities increased $73 million, or 1% compared to 2012.
This was because of the pension contributions made during the first quarter or 2014 which led to the increase of the cash flow. The net cash used in investing activities were $4,214 million and $7,506 million for 2013 and 2014, respectively. Next year, the company expects to make significant value of cash flows.The Coca Cola Company, 2015The nature of business of the Coca Cola Company is that they own and market more than 500 beverages brands of nonalcoholic products including sparkling beverages and other variety of beverages such as waters, juices, energy drinks and many more. They are known as the world’s largest beverage company.
Also, out of the world’s top 5 non-alcoholic soft drink, they own four namely – Coca-Cola, Diet Coke, Sprite and Fanta. The objective of the company is to use their formidable assets in achieving long-term growth. To achieve this objective, they have 5 strategic priorities which are as follows: 1). Accelerate sparkling growth, led by brand Coca-Cola, 2). Strategically expand our profitable still portfolio, 3) Increase media investments by maximizing productivity, 4). Win at the point of sale by unlocking the power of the Coca-Cola system, 5).
Invest in our next generation of leaders. Aside from these priorities, the company must enhance their core capabilities to be able to achieve their long-term growth objective and to become more competitive in the business.The company identified six categories of challenges and risks that could hinders the company’s growth and prosper the future, the following are as follows: 1). Obesity, Poor Diets and Inactive Lifestyles, 2). Water Quality and Quantity, 3).
Evolving Consumer Preferences, 4). Increased Competition and Capabilities, 5). Product Safety and Quality, 6).
Food Security. Though they have identified these six issues, they believed that their company could addressed the issues properly and appropriately.The Coca Cola sold 29.2 billion-unit cases in 2015 which is greater compare to the 28.6 billion-unit cases sold in 2014. In 2015, the company’s net operating revenue was $44,294 million which is lesser compare to the $45,998 million NOR in 2014.
The company’s current gross profit margin is lesser compare to the previous year’s turnout which is 60.5% and 61.1%, respectively. In 2015, the selling, general and administrative expenses was $16,427 million compared to $17,218 million incurred in 2014. The consolidated operating income of the company was 21.1% and 19.
7%, in 2014 and 2015, respectively. This indicates that the company’s operating income is lesser than the previous year.The company’s source of liquidity is their net cash from operations.
They do not typically raise capital through the issuance of stock. They raise capital not through the issuance of stock but instead, they use alternative action which is through debt financing. The company’s primary cash requirements have historically been borrowing of fund domestically. To back up their lines of credit which expires any time four years from now, they have a $8,340 million in lines of credit for the use in general corporate as of 2015.
The company provided a net cash of $10,615 million and $10,528 million, in 2014 and 2015, respectively. In 2015, the cash flow from operating activities decreased $87 million, or 1% compared to 2014. This was because of the result of the fluctuation of the foreign currencies. The net cash used in investing activities were $7,506 million and $6,186 million for 2014 and 2015, respectively. Next year, the company expects to make significant value of cash flows.The Coca Cola Company, 2016The nature of business of the Coca Cola Company is that they own and market more than 500 beverages brands of nonalcoholic products including sparkling beverages and other variety of beverages such as waters, juices, energy drinks and many more. They are known as the world’s largest beverage company. Also, out of the world’s top 5 non-alcoholic soft drink, they own four namely – Coca-Cola, Diet Coke, Sprite and Fanta.
The objective of the company is to use their formidable assets in achieving long-term growth. To achieve this objective, they have 5 strategic priorities which are as follows: 1). Accelerate sparkling growth, led by brand Coca-Cola, 2). Strategically expand our profitable still portfolio, 3) Increase media investments by maximizing productivity, 4). Win at the point of sale by unlocking the power of the Coca-Cola system, 5). Invest in our next generation of leaders.
Aside from these priorities, the company must enhance their core capabilities to be able to achieve their long-term growth objective and to become more competitive in the business.The company identified six categories of challenges and risks that could hinders the company’s growth and prosper the future, the following are as follows: 1). Obesity, Poor Diets and Inactive Lifestyles, 2).
Water Quality and Quantity, 3). Evolving Consumer Preferences, 4). Increased Competition and Capabilities, 5). Product Safety and Quality, 6).
Food Security. Though they have identified these six issues, they believed that their company could addressed the issues properly and appropriately.The Coca Cola sold 29.3 billion-unit cases in 2016 which is greater compare to the 29.2 billion-unit cases sold in 2015. In 2016, the company’s net operating revenue was $41,863 million which is lesser compare to the $44,294 million NOR in 2015. The company’s current gross profit margin is lesser compare to the previous year’s turnout which is 60.
5% and 60.7%, respectively. In 2016, the selling, general and administrative expenses was $15,262 million compared to $16,427 million incurred in 2015.
The consolidated operating income of the company was 19.7% and 20.6%, in 2015 and 2016, respectively. Because of the North America refranchise, the increase in the consolidated operating income was possible.The company’s source of liquidity is their net cash from operations. They do not typically raise capital through the issuance of stock.
They raise capital not through the issuance of stock but instead, they use alternative action which is through debt financing. The company’s primary cash requirements have historically been borrowing of fund domestically. To back up their lines of credit which expires any time six years from now, they have a $8,170 million in lines of credit for the use in general corporate as of 2016. The company provided a net cash of $10,528 million and $8,796 million, in 2015 and 2016, respectively. In 2016, the cash flow from operating activities decreased $1,732 million, or 16% compared to 2015. This was because of the result of the exchange rates of the different currencies of each country. The net cash used in investing activities were $6,186 million and $999 million for 2015 and 2016, respectively.
Next year, the company expects to make significant value of cash flows.The Coca Cola Company, 2017 The nature of business of the Coca Cola Company is that they own and market more than 500 beverages brands of nonalcoholic products including sparkling beverages and other variety of beverages such as waters, juices, energy drinks and many more. They are known as the world’s largest beverage company. Also, out of the world’s top 5 non-alcoholic soft drink, they own four namely – Coca-Cola, Diet Coke, Sprite and Fanta. The objective of the company is to use their formidable assets in achieving long-term growth.
To achieve this objective, they have 5 strategic priorities which are as follows: 1). Accelerate sparkling growth, led by brand Coca-Cola, 2). Strategically expand our profitable still portfolio, 3) Increase media investments by maximizing productivity, 4).
Win at the point of sale by unlocking the power of the Coca-Cola system, 5). Invest in our next generation of leaders. Aside from these priorities, the company must enhance their core capabilities to be able to achieve their long-term growth objective and to become more competitive in the business.The company identified six categories of challenges and risks that could hinders the company’s growth and prosper the future, the following are as follows: 1). Obesity, Poor Diets and Inactive Lifestyles, 2). Water Quality and Quantity, 3). Evolving Consumer Preferences, 4). Increased Competition and Capabilities, 5).
Product Safety and Quality, 6). Food Security. Though they have identified these six issues, they believed that their company could addressed the issues properly and appropriately.The Coca Cola sold 29.
2 billion-unit cases in 2017 which is greater compare to the 29.3 billion-unit cases sold in 2016. In 2017, the company’s net operating revenue was $35,410 million which is lesser compare to the $41,863 million NOR in 2016. The company’s current gross profit margin is greater compare to the previous year’s turnout which is 62.6% and 60.7%, respectively. In 2017, the selling, general and administrative expenses was $12,496 million compared to $15,262 million incurred in 2016.
The consolidated operating income of the company was 20.6%, and 21.2 %, in 2016 and 2017, respectively. It was because of the foreign currencies fluctuations.
The company’s source of liquidity is their net cash from operations. They do not typically raise capital through the issuance of stock. They raise capital not through the issuance of stock but instead, they use alternative action which is through debt financing. The company’s primary cash requirements have historically been borrowing of fund domestically.
To back up their lines of credit which expires any time five years from now, they have a $7,295 million in lines of credit for the use in general corporate as of 2017. The company provided a net cash of $8,796 million and $6,995 million, in 2016 and 2017, respectively. In 2017, the cash flow from operating activities decreased $1,801 million, or 20% compared to 2016.
This was because of the refranchise in North America and other country. The net cash used in investing activities were $999 million and $2,385 million for 2016 and 2017, respectively. Next year, the company expects to make significant value of cash flows.
