Coca Cola 2008 Annual Report Download - page 135

THE COCA-COLA COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 19: SIGNIFICANT OPERATING AND NONOPERATING ITEMS (Continued)
termination costs were primarily related to penalties incurred by the Company to terminate existing supply and
co-packer agreements. Charges related to asset impairments were primarily due to the write-down of
manufacturing lines that produce product packaging materials. These charges impacted the Eurasia and Africa,
Latin America, North America, Bottling Investments and Corporate operating segments.
In 2008, the Company recorded charges of approximately $84 million to other income (loss)—net, which
primarily consisted of $81 million of other-than-temporary impairment charges. As of December 31, 2008, the
Company had several investments classified as available-for-sale securities in which our cost basis exceeded
the fair value of the investment, each of which initially occurred between the end of the second quarter and the
beginning of the third quarter of 2008. Management assessed each individual investment to determine if
the decline in fair value was other than temporary. Based on these assessments, management determined that
the decline in fair value of each investment was other than temporary. These impairment charges impacted the
North America, Bottling Investments and Corporate operating segments. Refer to Note 10.
During 2008, the Company recognized gains of approximately $119 million due to divestitures, primarily
related to the sale of Remil to Coca-Cola FEMSA and the sale of 49 percent of our interest in Coca-Cola
Pakistan to Coca-Cola Icecek. These gains impacted the Bottling Investments and Corporate operating
segments and are included in other income (loss)—net in our consolidated statement of income. Refer to
Note 3.
During 2007, our Company recorded restructuring charges of approximately $237 million and asset write-
downs totaling approximately $31 million related to certain assets and investments in bottling operations, none
of which was individually significant. Of this total, approximately $14 million was recorded in cost of goods sold,
and approximately $254 million was recorded in other operating charges in our consolidated statement of
income.
In 2007, the Company sold a portion of its interest in Coca-Cola Amatil for proceeds of approximately
$143 million. As a result of this transaction, we recognized a pretax gain of approximately $73 million, which
impacted the Corporate operating segment and was included in other income (loss)—net in our consolidated
statement of income. Refer to Note 3.
During 2007, the Company sold substantially all of its interest in Vonpar. Total proceeds from the sale were
approximately $238 million, and we recognized a pretax gain on this sale of approximately $70 million, which
impacted the Corporate operating segment and was included in other income (loss)—net in our consolidated
statement of income. Refer to Note 3.
In 2007, the Company recorded pretax gains of approximately $66 million and $18 million resulting from
the sales of real estate in Spain and the United States, respectively. The gains were included in other income
(loss)—net in the consolidated statement of income and impacted the Corporate operating segment. Total
proceeds amounted to approximately $106 million.
Equity income in 2007 was reduced by approximately $99 million in the Bottling Investments operating
segment related to our proportionate share of asset write-downs recorded by CCBPI. The asset write-downs
primarily related to excess and obsolete bottles and cases at CCBPI. Refer to Note 3.
In 2007, our equity income was also reduced by approximately $62 million in the Bottling Investments
operating segment related to our proportionate share of an impairment recorded by Coca-Cola Amatil as a
result of the sale of its bottling operations in South Korea. Refer to Note 3.
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