Coca Cola 2008 Annual Report Download - page 60

proportionate share of restructuring charges and asset impairments recorded by certain equity method investees.
Refer to Note 3 of Notes to Consolidated Financial Statements. The impact of these charges was partially offset
by our proportionate share of increased net income from certain of our equity method investees, which included
the favorable impact of foreign exchange fluctuations.
In 2007, equity income (loss)—net was an equity income of approximately $668 million compared to
$102 million in 2006, an increase of $566 million. This increase was primarily attributable to an impairment
charge recorded by CCE during 2006, of which our Company’s proportionate share was approximately
$602 million. Refer to heading ‘‘Critical Accounting Policies and Estimates—Goodwill, Trademarks and Other
Intangible Assets,’’ and Note 3 and Note 19 of Notes to Consolidated Financial Statements. Additionally, the
increase in 2007 also reflected our proportionate share of increased net income from certain of our equity
method investees as a result of the overall improving health of the Coca-Cola bottling system in most of the
world, our proportionate share of tax benefits recorded by CCE and the favorable impact of foreign currency
fluctuations. The favorable impact of these items was partially offset by our proportionate share of impairment
charges recorded by Coca-Cola Amatil, restructuring charges recorded by CCE, the write-off of excess bottles
and cases at CCBPI and the net impact of acquisitions and divestitures of equity method investments during
2007 and 2006. Refer to Note 3 and Note 20 of Notes to Consolidated Financial Statements.
Other Income (Loss)—Net
Other income (loss)—net includes, among other things, the impact of foreign exchange gains and losses,
dividend income, rental income, gains and losses related to the disposal of property, plant and equipment,
realized and unrealized gains and losses on trading securities, realized gains and losses on available-for-sale
securities, other-than-temporary impairments of available-for-sale securities, the accretion of expense related to
certain acquisitions and minority shareowners’ proportionate share of net income of certain consolidated
subsidiaries.
In 2008, other income (loss)—net was a loss of $28 million. The Company recognized other-than-temporary
impairment charges of approximately $81 million on available-for-sale securities. Refer to the heading ‘‘Critical
Accounting Policies and Estimates—Investments in Equity and Debt Securities’’ and Note 10 and Note 19 of
Notes to Consolidated Financial Statements. Other income (loss)—net also included approximately $46 million
of realized and unrealized losses on trading securities. These losses, along with other charges that were not
individually significant, were partially offset by gains on divestitures of approximately $119 million, primarily
related to the sale of Remil to Coca-Cola FEMSA and the sale of a portion of the Company’s investment in
Coca-Cola Pakistan to Coca-Cola Icecek A.S. (‘‘Coca-Cola Icecek’’). Refer to Note 3 and Note 19 of Notes to
Consolidated Financial Statements.
In 2007, other income (loss)—net was income of $173 million. The Company recognized a gain of
approximately $73 million due to the sale of a portion of the Company’s ownership interest in Coca-Cola
Amatil. As a result of this transaction, our ownership interest in Coca-Cola Amatil was reduced from
approximately 32 percent to 30 percent. In addition, we recognized a gain of approximately $70 million as a
result of the sale of our equity investment in Vonpar Refrescos S.A. (‘‘Vonpar’’) and gains of approximately
$84 million due to the sale of real estate in Spain and the United States. Refer to Note 3 and Note 19 of Notes to
Consolidated Financial Statements.
In 2006, other income (loss)—net was income of $195 million, primarily attributable to a gain of
approximately $175 million as a result of the sale of a portion of our Coca-Cola FEMSA shares to FEMSA and a
gain of approximately $123 million due to the sale of a portion of our investment in Coca-Cola Icecek shares in
an initial public offering. These gains were partially offset by the accretion of approximately $58 million of
expense related to the discounted value of our liability to purchase Coca-Cola Erfrischungsgetraenke AG
(‘‘CCEAG’’) shares and approximately $15 million in foreign currency exchange losses. Refer to Note 3 and
Note 19 of Notes to Consolidated Financial Statements.
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