Coca Cola 2015 Annual Report Download - page 57

In February 2014, the Company announced the expansion of our productivity and reinvestment program to drive an incremental $1 billion in productivity
by 2016 that will primarily be redirected into increased media investments. Our incremental productivity goal consists of two relatively equal components.
First, we will expand savings through global supply chain optimization, data and information technology system standardization, and resource and cost
reallocation. Second, we will increase the effectiveness of our marketing investments by transforming our marketing and commercial model to redeploy
resources into more consumer-facing marketing investments to accelerate growth.
In October 2014, the Company announced that we are further expanding our productivity and reinvestment program and extending it through 2019. The
expansion of the productivity initiatives will focus on four key areas: restructuring the Company's global supply chain, including manufacturing in North
America; implementing zero-based work, an evolution of zero-based budget principles, across the organization; streamlining and simplifying the Company's
operating model; and further driving increased discipline and efficiency in direct marketing investments. The Company expects that the expanded
productivity initiatives will generate an incremental $2 billion in annualized productivity. This productivity will enable the Company to fund marketing
initiatives and innovation required to deliver sustainable net revenue growth and will also support margin expansion and increased returns on invested
capital over time. We expect to achieve total annualized productivity of approximately $3.6 billion by 2019 from the initiatives implemented under this
program since it began in 2012.
We have incurred total pretax expenses of $2,056 million since the initiative commenced in 2012. Refer to Note 18 of Notes to Consolidated Financial
Statements for additional information.
Integration of Our German Bottling Operations
In 2008, the Company began the integration of our German bottling operations acquired in 2007. Since the integration commenced, the Company has
incurred total pretax expenses of $1,127 million primarily related to involuntary terminations. We are currently reviewing additional restructuring
opportunities within the German bottling operations, including integration costs related to information technology and other initiatives. If implemented,
these initiatives will result in additional charges in future periods. Our German bottling operations are now classified as held for sale. Refer to Note 18 of
Notes to Consolidated Financial Statements.
Operating Income and Operating Margin
Information about our operating income contribution by operating segment on a percentage basis is as follows:
Year Ended December 31, 
2014
2013
Eurasia & Africa 
11.2%
10.6%
Europe 
29.4
28.0
Latin America 
23.8
28.4
North America 
25.2
23.8
Asia Pacific 
25.2
24.2
Bottling Investments 
0.1
1.1
Corporate 
(14.9)
(16.1)
Total 
100.0%
100.0%
Information about our operating margin on a consolidated basis and by operating segment is as follows:
Year Ended December 31, 
2014
2013
Consolidated 
21.1%
21.8%
Eurasia & Africa 
39.7%
39.3%
Europe 
58.9
61.5
Latin America 
50.4
61.3
North America 
11.4
11.3
Asia Pacific 
46.6
46.1
Bottling Investments 
0.1
1.5
Corporate 
*
*
*Calculation is not meaningful.
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