Coca Cola 2014 Annual Report Download - page 48

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volume growth, and Japan reported a volume decline of 1 percent, reflecting 1 percent growth in sparkling beverages offset by a
1 percent decline in still beverages.
Unit case volume for Bottling Investments decreased 2 percent. This decrease primarily reflects the deconsolidation of our bottling
operations in Brazil during July 2013 as a result of their combination with an independent bottling partner. The unfavorable impact
of these transactions on the group’s unit case volume results was partially offset by growth in other key markets, including China and
India, where we own or otherwise consolidate bottling operations. The Company’s consolidated bottling operations accounted for
35 percent and 65 percent of the unit case volume in China and India, respectively.
Year Ended December 31, 2013 versus Year Ended December 31, 2012
In Eurasia and Africa unit case volume increased 7 percent, which consisted of 6 percent growth in sparkling and 13 percent growth in
still beverages. The group’s sparkling beverage growth was led by 6 percent growth in brand Coca-Cola, 5 percent growth in Trademark
Sprite and 3 percent growth in Trademark Fanta. This growth reflects a continued focus on driving exceptional capabilities in the
marketplace, integrated marketing campaigns and greater consumer choice in package and price options. Growth in still beverages
was led by packaged water, juices and juice drinks, and teas. Russia reported unit case growth of 3 percent, driven by growth of
11 percent in brand Coca-Cola. Still beverage growth in Russia included growth of 7 percent and 24 percent in our juice brands Dobriy
and Rich, respectively. Unit case growth in Russia was favorably impacted by the Company’s marketing activities related to the Sochi
2014 Winter Olympics and Olympic Torch Relay. Eurasia and Africa also benefited from unit case volume growth of 14 percent in the
Company’s Middle East & North Africa business unit, including a 5 percent benefit primarily related to our Aujan partnership, and
8 percent growth in the Company’s Central, East & West Africa business unit.
Unit case volume in Europe declined 1 percent, which consisted of a 1 percent decline in sparkling beverages and a 5 percent decline
in still beverages, primarily packaged water and teas. These declines reflect the impact of particularly poor weather across many
countries during the second quarter of 2013, including severe flooding in parts of Germany and Central Europe, competitive pricing,
and ongoing weakness in consumer confidence and spending across the region. In spite of these challenges, our Germany business
unit reported growth of 2 percent and our Northwest Europe & Nordics business unit reported growth of 1 percent. This growth was
driven by the Company’s strong commercial campaigns such as “Share a Coke,” “Coke with Meals,” and the Coca-Cola Christmas
Truck Tour. These increases were offset by a decline in unit case volume of 4 percent in the Central & Southern Europe business unit
and a volume decline of 3 percent in the Iberia business unit, both of which continue to manage through very tough macroeconomic
conditions.
In Latin America, unit case volume increased 1 percent, which primarily reflects 8 percent growth in still beverages while volume in
sparkling beverages was even. The group reported growth of 6 percent in the Latin Center business unit and growth of 4 percent in the
South Latin business unit, driven by strong activation of brand and category advertising as well as investments in cold-drink equipment
and continued segmentation across multiple price points and package sizes. The group’s still beverage growth reflects increases in
the tea, packaged water, and juice and juice drink categories of 16 percent, 6 percent and 5 percent, respectively. Argentina reported
unit case growth of 7 percent, led by strong growth in Trademark Bonaqua and 5 percent growth in brand Coca-Cola. The growth in
the Mexico business unit was even due to a slower economy and the significant disruption caused by hurricanes Manuel and Ingrid in
September 2013. Volume in Brazil declined 2 percent, which reflects some consumer uncertainty given the economic slowdown in the
country.
Unit case volume in North America was even reflecting overall category softness, unseasonably cold and wet weather during the
second quarter of 2013 and weak consumer confidence, which negatively impacted consumer spending. Sparkling beverages declined
2 percent, whereas still beverages grew 5 percent during the period. Still beverage growth in North America was led by strong
performance in teas, juices and juice drinks and packaged water. The group continued to implement a multi-brand strategy around
teas and reported 15 percent volume growth, primarily due to increases in Gold Peak, Honest Tea and Fuze. Volume growth in juices
and juice drinks was 4 percent, led by 7 percent growth in Trademark Simply, and packaged water volume benefited from strong
growth in Dasani and smartwater.
In Asia Pacific, unit case volume increased 3 percent, which consisted of 3 percent growth in sparkling beverages and 4 percent growth
in still beverages. Sparkling beverage growth was led by 5 percent growth in brand Coca-Cola and 4 percent growth in Trademark
Fanta. India reported 4 percent unit case volume growth, led by growth of 18 percent in brand Coca-Cola and 5 percent growth in
Trademark Sprite. India’s growth reflects the impact of strong integrated marketing campaigns and continued expansion of packaging
choices to consumers. Japan’s unit case growth was 1 percent during the period, including 2 percent growth in sparkling beverages.
China reported unit case volume growth of 3 percent, including volume growth of 4 percent in sparkling beverages and 3 percent
in still beverages. The group’s volume results also benefited from 25 percent growth in Vietnam and 9 percent growth in Thailand,
partially offset by declines of 3 percent in the Philippines and 4 percent in Australia.