Coca Cola 2006 Annual Report Download - page 120

THE COCA-COLA COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 18: SIGNIFICANT OPERATING AND NONOPERATING ITEMS (Continued)
The Company made a $100 million donation to The Coca-Cola Foundation in 2006, which resulted in a
charge to the consolidated statement of income line item selling, general and administrative expenses and
impacted the Corporate operating segment.
In 2006, the Company sold a portion of its Coca-Cola FEMSA shares to FEMSA and recorded a pretax
gain of approximately $175 million to the consolidated statement of income line item other income (loss)—net,
which impacted the Corporate operating segment. Refer to Note 3.
The Company sold a portion of our investment in Coca-Cola Icecek in an initial public offering in 2006. Our
Company received net cash proceeds of approximately $198 million and realized a pretax gain of approximately
$123 million, which was recorded as other income (loss)—net in the consolidated statement of income and
impacted the Corporate operating segment. Refer to Note 3.
In 2005, our Company received approximately $109 million related to the settlement of a class action
lawsuit concerning price-fixing in the sale of HFCS purchased by the Company during the years 1991 to 1995.
Subsequent to the receipt of this settlement amount, the Company distributed approximately $62 million to
certain bottlers in North America. From 1991 to 1995, the Company purchased HFCS on behalf of these
bottlers. Therefore, these bottlers were ultimately entitled to a portion of the proceeds of the settlement. Of the
approximately $62 million we distributed to certain bottlers in North America, approximately $49 million was
distributed to CCE. The Company’s remaining share of the settlement was approximately $47 million, which was
recorded as a reduction of cost of goods sold and impacted the Corporate operating segment.
During 2005, we recorded approximately $23 million of noncash pretax gains on the issuances of stock by
equity method investees. Refer to Note 4.
The Company recorded approximately $50 million of expense in 2005 as a result of a change in our
estimated service period for the acceleration of certain stock-based compensation awards. Refer to Note 15.
Equity income in 2005 was reduced by approximately $33 million for the Bottling Investments operating
segment, primarily related to our proportionate share of the tax liability recorded by CCE resulting from its
repatriation of previously unremitted foreign earnings under the Jobs Creation Act, as well as our proportionate
share of restructuring charges. Those amounts were partially offset by our proportionate share of CCE’s HFCS
lawsuit settlement proceeds and changes in certain of CCE’s state and provincial tax rates. Refer to Note 3.
Our Company recorded impairment charges during 2005 of approximately $84 million related to certain
trademarks for beverages sold in the Philippines and approximately $1 million related to impairment of other
assets. These impairment charges were recorded in the consolidated statement of income line item other
operating charges.
During 2004, our Company’s equity income benefited by approximately $37 million for our proportionate
share of a favorable tax settlement related to Coca-Cola FEMSA. Refer to Note 3.
In 2004, we recorded approximately $24 million of noncash pretax gains on the issuances of stock by CCE.
Refer to Note 4.
We recorded impairment charges during 2004 of approximately $374 million, primarily related to the
impairment of franchise rights at CCEAG and approximately $18 million related to other assets. These
impairment charges were recorded in the consolidated statement of income line item other operating charges.
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