FINANCE PROJECT
COKE
S
FIANCIAL STATEMENTS ANALYSIS
GROUP MEMBERS :
MURAD SAQIB
SUBMITTED TO:
SIR. Muddasir Mehboob
DATE OF SUBMISSION:
13 JUNE, 2012
ARMY PUBLIC COLLEGE OF MANAGEMENT AND SCIENCES
KHADIM HUSSAIN ROAD, LALKURTI, RAWALPINDI.
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ACKNOWLWDGEMENT
First and fore mostly we would like to thank Almighty Allah who blessed us
with knowledge, understanding and ability to do this project.
We have discovered that the work of some unknown persons makes our lives
easier every day. We believe it's appropriate to acknowledge all of these
unknown persons; but it is also necessary to acknowledge those people we
know have directly shaped our lives and our work.
First of all we would like to thank our teacher Mr. Muddasir Mehboob for his
guidance throughout the semester.
DEDICATION
This project is dedicated to our parents who have enabled us to stand on our
own feet and have guided us in all matters of life.
May Allah bless them!
Ameen
Executive Summary
I am the student of BBA of Army Public College of Management & Science
and we have established this finance project on Coke after critically examining
and thoroughly researching over it.
It consists of examining
About The Company
The Coke Cola was established in 1886 by John S. Pemberton in Columbia,
Georgia. In 1889 Coca Cola formula and brand was established by Asa Candler
who also incorporated The Coca-Cola Company in 1892. However the bottling
business began in 1899. The Coca-Cola Company is a multinational beverage
corporation and manufacturer and marketer of non-alcoholic beverage
concentrates and syrups which are then sold to various countries throughout the
world.
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Type
Manufacturer
Founder (s)
Country of Origin
Introduced
Area Served
Brands
Flavors
Employees
Servings per Day
Website
Soft Drink (Cola)
The Coca- Cola Company
John S. Pemberton
United States
1886
Over 200 countries
More then 500
Cola, Cola Green Tea, Cola Lemon,
Cola Lemon Lime, Cola Lime, Cola
Orange and Cola Raspberry.
92,400
1.6 Billion
www.coca-cola.com
COCA COLA PAKISTAN
The Coke Cola company started operating in Pakistan in 1953 which is owned
by (CCBP) Coca Cola Beverages Pakistan Limited. Its Plants are in Karachi,
Hyderabad, Sialkot, Gujranwala, Faisalabad, Rahimyar Khan, Multan and
Lahore. The remaining two plants, independently owned, are in Rawalpindi and
Peshawar. The Coca-Cola System in Pakistan serves 70,000 customers/retail
outlets. The Coca-Cola System in Pakistan employs 1,800 people.
Mission Statement
Following are the declarations of COKE overall mission and goals, and the
values that COKE is guided by as a company and as individuals.
 To refresh the world - in mind, body and spirit
 To inspire moments of optimism - through our brands and actions
 To create value and make a difference everywhere we engage
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Coca Cola Company Vision
To achieve COKE mission, they has developed a set of goals, which they will
work with their bottlers to deliver:
 Profit: Maximizing return to shareholders, while being mindful of our
overall responsibilities
 People: Being a great place to work, where people are inspired to be the
best they can be
 Portfolio: Bringing to the world a portfolio of beverage brands that
anticipate and satisfy people's desires and needs
 Partners: Nurturing a winning network of partners and building mutual
loyalty
 Planet: Being a responsible global citizen that makes a difference
 Productivity: Be a highly effective, lean and fast-moving organization
The Coca Cola Company Values
 Leadership
 Passion
 Integrity
 Accountability
 Collaboration
 Innovation
 Quality
The Coca Cola Company creates value by executing comprehensive business
strategy guided by six key beliefs:
 Consumer demand drives everything we do.
 Brand Coca Cola is the core of our business
 We will serve consumers a broad selection of the nonalcoholic ready-to–
drink beverages they want to drink throughout the day.
 We will be the best marketers in the world.
 We will think and act locally.
 We will lead as a model corporate citizen.
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MAJOR PRODUCTS OF COCA COLA INTERNATIONAL
Product Name
Coke
Sprite
Fanta
Diet Coke
Minute Maid
Minute Maid Juices
Kinley Drinking Water
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Image
INCOME STATEMENT
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Period Ended ($000) 12/31/2011 12/31/2010 12/31/2009 12/31/2008 12/31/2007
Net Sales
8,284.00
6,714.00
6,517.00
6,619.00
6,246.00
Cost of Revenue
5,254.00
4,234.00
4,113.00
4,269.00
3,987.00
Gross Profit
3,030.00
2,480.00
2,404.00
2,350.00
2,259.00
Selling / General /
1,778.00
1,487.00
1,413.00
1,598.00
1,545.00
Administrative
Expenses, Total
Depreciation
200
169
177 --Unusual Expense
19
14
9 --(Income)
Total Operating
7,251.00
5,904.00
5,712.00
5,867.00
5,532.00
Expense
Operating Income
1,033.00
810
805
752
714
Interest Income
-85
-63
-83
-119
-147
(Expense), Net NonOperating
Other Non-Operating
-3
-1
5
-4
1
Income (Expense)
Other, Net
-3
-1
5
-4
1
Net Income Before
945
746
727
629
568
Taxes
Net Income After
749
624
576
514
524
Taxes
Net Income
749
624
576
514
524
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BALANCE SHEET
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Period Ended
In millions of USD
(except for per share
items)
Cash and Short Term
Investments
Accounts Receivable Trade, Gross
Provision for Doubtful
Accounts
Accounts Receivable Trade, Net
Receivables - Other
Total Receivables, Net
Inventories - Finished
Goods
Inventories - Raw
Materials
Total Inventory
Prepaid Expenses
Other Current Assets,
Total
Total Current Assets
Buildings - Gross
Land / Improvements Gross
Machinery / Equipment
- Gross
Construction in
Progress - Gross
Property / Plant /
Equipment, Total Gross
Accumulated
Depreciation, Total
Property / Plant /
Equipment, Total - Net
Goodwill, Net
Intangibles, Net
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12/31/2011 12/31/2010
12/31/2009 12/31/2008 12/31/2007
684
321
404
722
223
1,403.00
1,345.00
1,322.00
2,206.00
2,264.00
-16
-16
-13
-52
-47
1,451.00
1,415.00
1,387.00
2,308.00
2,361.00
-1,451.00
225
0
1,415.00
230
153
1,540.00
193
-2,308.00
639
-2,361.00
610
178
137
95
262
314
403
148
--
367
127
--
288
124
--
901
408
244
924
318
206
2,686.00
880
154
2,230.00
887
157
2,356.00
773
125
4,583.00
2,552.00
478
4,032.00
2,608.00
512
3,369.00
3,224.00
3,074.00
11,279.00
11,670.00
214
124
99
208
239
4,617.00
4,392.00
4,071.00
14,517.00
15,029.00
-2,387.00
-2,172.00
-2,188.00
-8,274.00
-8,267.00
2,230.00
2,220.00
1,883.00
6,243.00
6,762.00
124
3,771.00
131
3,828.00
0
3,487.00
604
3,234.00
606
11,767.00
Other Long Term
Assets, Total
Total Assets
Accounts Payable
Accrued Expenses
Current Portion of Long
Term Debt / Capital
Leases
Customer Advances
Income Taxes Payable
Other Current liabilities,
Total
Total Current Liabilities
Long Term Debt
Total Debt
Deferred Income Tax
Long Term Liability
Minority Interest
Pension Benefits Underfunded
Other Long Term
Liabilities
Total Liabilities
Common Stock
Additional Paid-In
Capital
Retained Earnings
(Accumulated Deficit)
Treasury Stock Common
Translation Adjustment
Minimum Pension
Liability Adjustment
Other Comprehensive
Income
Total Equity
Total Liabilities &
Shareholders' Equity
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283
187
246
925
932
9,094.00
589
1,004.00
8,596.00
606
1,035.00
7,972.00
570
872
15,589.00
1,243.00
1,832.00
24,099.00
1,349.00
1,826.00
16
162
620
1,782.00
2,002.00
-239
239
-139
139
-130
130
46
171
217
48
171
219
1,848.00
2,996.00
3,012.00
1,191.00
1,942.00
2,124.00
2,286.00
1,238.00
2,192.00
235
855
1,172.00
5,074.00
7,247.00
9,029.00
1,086.00
5,396.00
7,391.00
9,393.00
4,190.00
---
---
---
22
2,115.00
-1,309.00
160
149
1,194.00
76
124
6,195.00
3
3,745.00
5,453.00
3
3,628.00
4,793.00
3,367.00
0
15,620.00
495
3,277.00
18,410.00
494
3,215.00
638
57
0
-3,029.00
1,527.00
-1,014.00
-200
0
-108
-104
-216
-258
-142
-198
36
-228
---
---
1
-5
4
-666
557
2,899.00
9,094.00
3,143.00
8,596.00
3,179.00
7,972.00
-31
15,589.00
5,689.00
24,099.00
RATIO ANALYSIS
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Profitability Ratios
Period Ended
Net profit
Margin
Gross Profit
Margin
ROI Ratio
ROE
Earning power
Current Ratio
Acid Test Ratio
LT Debt to
Equity Ratio
Total Debt to
Equity Ratio
Total Debt to
Total Assets
Total Assets
Turnover
Interest
Coverage Ratio
Inventory
Turnover Ratio
Accounts
Receivable
Turnover Ratio
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12/31/2011
12/31/2010
12/31/2009
12/31/2008
12/31/2007
90.41525833
92.94012511 88.38422587 77.65523493 83.89369196
36.57653308
8.236199692
36.16714697
2.174364081
36.93774203 36.88813871 35.50385255
7.259190321 7.22528851 3.297196741
25.83649534 19.85364302 18.11890532 1658.064516
8.236199692 7.259190321 7.22528851 3.297196741
Financial Strength Ratios
1.453463203 1.148300721 1.074817518 0.903232164
1.23538961 0.959320288 0.943430657 0.725660229
103.3459814 67.57874642 7.392261718 23377.41935
Activity Ratios
103.8978958 72.73305759 26.89525008 29125.80645
9.210757602
2.174364081
0.747220163
0.575982209
129.9173844
165.1081034
33.12073895
26.59376454 10.72503763 57.91904548 38.97672103
91.09302837
78.10609586 81.74862017 42.45942652 25.91808789
12.15294118
9.529411765 9.470588235 8.847058824
13.03722084
11.53678474
5.709166092
4.744876325 4.698630137 2.867850953 2.645489199
8.4
14.28125 4.738068812 4.314935065
Commenting :
 Coca cola‘s profitability position as revealed by the ratios is that there profit
is consistently increasing from 2008 to 2011 which is more then 90 % in
2011 which is due to there high sales in last year.
 There gross profit ratio is less then 40% in last five years which are due to
the increase in Cost of goods sold and due to steady increase in Gross profit
of five years.
 ROE is increasing steadily too which means there is need to increase the
company s finance level and in equity.
 There Earning Power ratio has only increased 1% in last few years.
 Coke’s quick ratio has improved from last few years which have improved
the Coke’s ability to pay its debts and loans on time.
 Coke’s all ratios have increased in last few years which show positive signs
for coke in future.
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Here is the other financial information of Coke:
Marketing Budget
TV Budget
Channel
Timing
No. of ads
Price/mint
PTV home
8am
5
PKR 100,000
9pm
4
PKR 132,226
AAG
8pm
4
PKR 50,000
Geo
10pm
5
PKR 70,000
ARY
9pm
5
PKR 400,000
23
PKR 752,225
Total
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Newspaper Budget
News Papers
Size
Day
Prices
Dawn
27x4
Sunday
PKR 430,920
The News
27x4
Sunday
PKR 1,682,000
Total
PKR 2,112,920
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Growth Rate in Market Share Geographically
Unit case Volume
2010 Vs 2011 Growth rate
2008
Vs 5 year Annual Net
Op. Op. Income
2009 Growth Growth
Revenues
Africa
10%
6%
16%
6%
Eurasia
16%
13%
24%
38%
European
Union
3%
2%
14%
16%
Latin
America
9%
6%
24%
22%
North
America
(1%)
1%
11%
1%
Pacific
7%
4%
7%
3%
Bottling
Investments
64%
N/A
53%
75%
Worldwide
6%
4%
20%
15%
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Sales Forecast
Sales and 2007
Income
Data
in
Millions
2008
2009
2010
2011
Net Sales $21,742
$23,104
$24,088
$28,857
$31,944
Net
Income
(Profits)
$4,872
$5,080
$5,981
$5,807
20.6
21.4
22.7
23.7
$4,847
Units sold 19.8
in Billions
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Recommendations
Following are the recommendations which we came up with fro Coca Cola after
completing our project:
 Currently in Pakistan there are only two flavor of Coke available,
company can extend their portfolio by introducing new flavors.
 According to the survey conducted by an international firm Pakistani
people like less sweet cola drink. So the Coca-Cola Company should
think about bringing innovations in their products for example new diet
flavors or maybe more juices so as to fulfill the need of local market.
 They should try to increase the availability of Coke in rural areas.
 Coca Cola Company should think about producing Coke Can locally.
Because currently coke Cans are only smuggled from abroad and sold at
high prices. The Coca Cola Company can capitalize on this factor.
 Coca Cola Company should try to emphasis more on providing their
infrastructure in the market to facilitate their customers.
 According to the survey, conducted by the international firm Pakistani
people like little bit sweeter cola drink. So for this coca cola company
should produce their product according to the local demand.
 Now young generation has a trend to drink coke 2 regular bottles at same
time, so providing more satisfaction to them company should introduce
new disposable bottles
 They should also introduce 3 litres family pack coke and other fruit juices
in the market. As this will boost up their sales and profitability.
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References





www.cocacola.com
www.thecocacolacompany.com
www.wikipedia.com
www.coca-cola.com
www.finance.mapsofworld.com
***Success without Effort Is Impossible***
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