University of Jordan

Faculty of Business

Strategic Management

“Coca-Cola Company”

Case StudySTRATEGIC MANAGEMENT

Prepared By

Fathi Salem Mohammed Abdullah

2009

History analysis In May, 1886, Coca Cola was invented by Doctor John Pemberton a

pharmacist from Atlanta, Georgia. John Pemberton concocted the Coca Cola formula in a three legged brass kettle in his backyard.

Being a bookkeeper, Frank Robinson also had excellent penmanship. It was he who first scripted "Coca Cola" into the flowing letters which has become the famous logo of today.

The soft drink was first sold to the public at the soda fountain in Jacob's Pharmacy in Atlanta on May 8, 1886.

Until 1905, the soft drink, marketed as a tonic, contained extracts of cocaine as well as the caffeine-rich kola nut.

Until the 1960s, both small town and big city dwellers enjoyed carbonated beverages at the local soda fountain or ice cream saloon. Often housed in the drug store, the soda fountain counter served as a meeting place for people of all ages. Often combined with lunch counters, the soda fountain declined in popularity as commercial ice cream, bottled soft drinks, and fast food restaurants became popular.

On April 23, 1985, the trade secret "New Coke" formula was released. Today, products of the Coca Cola Company are consumed at the rate of more than one billion drinks per day.

Vision Statement (actual)

To maintain our reputation as the leading cola company in the world.

Mission Statement (actual)

Everything we do is inspired by our enduring mission:

To Refresh the World... in body, mind, and spirit. To Inspire Moments of Optimism... through our brands and our actions. To Create Value and Make a Difference... everywhere we engage.

(proposed)

At Coca Cola we believe our main responsibility is providing customers (1) with refreshing beverages including soft drinks, water, energy drinks, juices, and tea (2) to fit any occasion in their day to day lives (6). Our signature product, Coke (7), is a favorite around the world and a wide variety of our products are sold in over 200 nations (3). We use the only the most sophisticated equipment (4) to process and make our products to

ensure each glass of Coke product is as good as the last (5). Our employees (9) are fairly compensated and we practice fair trade in all markets we compete. We value our responsibility to all communities we serve and support many educational and leadership programs (8).

1. Customer2. Products or services3. Markets4. Technology5. Concern for survival, profitability, growth6. Philosophy7. Self-concept8. Concern for public image 9. Concern for employees

The Five Forces Framework

Barriers to Entry: 

The several factors that make it very difficult for the competition to enter the soft drink market include:

Bottling Network: Both Coke and PepsiCo have franchisee agreements with their existing bottler’s who have rights in a certain geographic area in perpetuity. These agreements prohibit bottler’s from taking on new competing brands for similar products. Also with the recent consolidation among the bottler’s and the backward integration with both Coke and Pepsi buying significant percent of bottling companies, it is very difficult for a firm entering to find bottler’s willing to distribute their product.

 The other approach to try and build their bottling plants would be very capital-intensive effort with new efficient plant capital requirements in 1998 being $75 million. 

Advertising Spend: The advertising and marketing spend (Case Exhibit 5 & 6) in the industry is in 2000 was around $ 2.6 billion (0.40 per case * 6.6 billion cases) mainly by Coke, Pepsi and their bottler’s.  The average advertisement spending per point of market share in 2000 was 8.3 million (Exhibit 2). This makes it extremely difficult for an entrant to compete with the incumbents and gain any visibility.

Brand Image / Loyalty: Coke and Pepsi have a long history of heavy advertising and this has earned them huge amount of brand equity and loyal customer’s all over the world. This makes it virtually impossible for a new entrant to match this scale in this market place.

Retailer Shelf Space (Retail Distribution): Retailers enjoy significant margins of 15-20% on these soft drinks for the shelf space they offer. These margins are quite significant for their bottom-line.   This makes it tough for the new entrants to convince retailers to carry/substitute their new products for Coke and Pepsi.

Fear of Retaliation: To enter into a market with entrenched rival behemoths like Pepsi and Coke is not easy as it could lead to price wars which affect the new comer.

 Suppliers: 

Commodity Ingredients: Most of the raw materials needed to produce concentrate are basic commodities like Color, flavor, caffeine or additives, sugar, packaging. Essentially these are basic commodities. The producers of these products have no power over the pricing hence the suppliers in this industry are weak.

 Buyers:  

The major channels for the Soft Drink industry (Exhibit 6) are food stores, Fast food fountain, vending, convenience stores and others in the order of market share. The profitability in each of these segments clearly illustrate the buyer power and how different buyers pay different prices based on their power to negotiate.

Food Stores: These buyers in this segment are some what consolidated with several chain stores and few local supermarkets, since they offer premium shelf space they command lower prices, the net operating profit before tax (NOPBT) for concentrate producer’s in this segment is $0.23/case

Convenience Stores: This segment of buyer’s is extremely fragmented and hence have to pay higher prices, NOPBT here is  $0.69 /case.

Fountain:  This segment of buyer’s are the least profitable because of their large amount of purchases hey make, It allows them to have freedom to negotiate. Coke and Pepsi primarily consider this segment “Paid Sampling” with low margins. NOPBT in this segment is  $0.09 /case.

Vending: This channel serves the customer’s directly with absolutely no power with the buyer, hence NOPBT of $0.97/case.

 Substitutes: Large numbers of substitutes like water, beer, coffee, juices etc are available to the end consumers but this countered by concentrate providers by huge advertising, brand equity, and making their product easily available for consumers, which most substitutes cannot match. Also soft drink companies diversify business by offering substitutes themselves to shield themselves from competition. Rivalry: 

The Concentrate Producer industry can be classified as a Duopoly with Pepsi and Coke as the firms competing. The market share of the rest of the competition is too small to cause any upheaval of pricing or industry structure. Pepsi and Coke mainly over the years competed on differentiation and advertising rather than on pricing except for a period in the 1990’s. This prevented a huge dent in profits. Pricing wars are however a feature in their international expansion strategies.

PEST Analysis

The PEST Analysis is an analysis to examine the macro-environment of Coca-Cola’s operations (Johnson, Scholes and Whittington, 2008).

Political

Like most companies, Coca-Cola is monitoring the policies and regulations set by the government. There are no political issues in this instance.

Economic

There is low growth in the market for carbonated drinks, especially in Coca-Cola’s main market, North America. The market growth recorded at only 1% for North America in 2004.

Social

There are changes in consumers’ lifestyles. Consumers are more health conscious. This affects the Coca-Cola’s sales of the carbonated drinks as consumers prefer non-carbonated drinks such as tea, juices and bottled drinks. Demand for carbonated drinks decreases and this leads to a decrease in Coca-Cola’s revenues.

Technological

As the technology advances, new products are introduced into the market. The advance in technology has led to the creation of cherry coke in 1985 but consumers still prefers the traditional taste of the original coke.

External Audit

Opportunities Threats

1. Bottled water consumption has increased 11 percent.

2. According to the S&P Industry Survey, consumers are drawn to new smaller beverage brands that are not sold on a mass scale.

3. Word Economic Forum’s annual Davos, Switzerland gathering grants international voice.

4. Less developed countries are in desperate need to improve community water supplies.

5. Energy drink sales are expected to increase 7 to 8 percent in 2007.

6. Disposable income has increased 6.2 percent.

7. Consumers are striving to drink and eat their way to better health than pervious generations.

8. EPS is expected to rise 7 to 8 percent in 2007.

1. Consumption of American beverages is denounced by foreign officials in areas where conflicting interest exist.

2. Multiple lawsuits against the new Enviga beverage for calorie burning claims in advertising

3. Smaller, lesser known brands are turning to major beer distributors for bottling.

4. Overall carbonated drink sales have been flat due to links of sugar to obesity and high fructose corn syrup to heart disease.

5. Pepsi is more diversified offering beverage and food products.

6. High cost of commodities such as sugar, and metals used in production of cans.

7. Many smaller companies are fierce competitors around the world in their local markets.

CPM – Competitive Profile Matrix

Coca-Cola Pepsi Cadbury SchweppesCritical Success Factors

Weight Rating Weighted Score

Rating Weighted Score

Rating Weighted Score

Market Share 0.15 4 0.60 3 0.45 2 0.30

Price CompFinancial PositionProduct QualityProduct LinesCustomer LoyaltyEmployeesMarketingTotal

0.100.120.150.150.150.110.071.00

3 0.304 0.483 0.45 4 0.604 0.603 0.333 0.21 3.71

3 0.304 0.483 0.454 0.604 0.603 0.333 0.21 3.56

3 0.303 0.363 0.453 0.453 0.453 0.333 0.21 2.85

External Factor Evaluation (EFE) Matrix

Key External Factors Weight Rating Weighted ScoreOpportunities1. Bottled water consumption has increased 11

percent.0.06 4 0.24

2. According to the S&P Industry Survey, consumers are drawn to new smaller beverage brands that are not sold on a mass scale.

0.05 2 0.10

3. Word Economic Forum’s annual Davos, Switzerland gathering grants international voice.

0.02 2 0.04

4. Less developed countries are in desperate need to improve community water supplies.

0.02 2 0.04

5. Energy drink sales are expected to increase 7 to 8 percent in 2007.

0.06 3 0.18

6. Disposable income has increased 6.2 percent. 0.05 3 0.157. Consumers are striving to drink and eat their

way to better health than pervious generations.0.07 3 0.21

8. EPS is expected to rise 7 to 8 percent in 2007. 0.07 4 0.28Threats1. Consumption of American beverages is

denounced by foreign officials in areas where conflicting interest exist.

0.02 3 0.06

2. Multiple lawsuits against the new Enviga beverage for calorie burning claims in advertising

0.04 2 0.08

3. Smaller, lesser known brands are turning to major beer distributors for bottling.

0.06 2 0.12

4. Overall carbonated drink sales have been flat due to links of sugar to obesity and high fructose corn syrup to heart disease.

0.10 2 0.20

5. Pepsi is more diversified offering beverage and food products.

0.20 3 0.60

6. High cost of commodities such as sugar, and metals used in production of cans.

0.10 3 0.30

7. Many smaller companies are fierce competitors around the world in their local markets.

0.08 3 0.24

TOTAL 1.00 2.84

Internal Audit

Strength Weakness

1. Product line has over 400 brands.2. Strong global presence, located in

over 200 countries.3. Long history has built excellent

brand recognition.4. Partnership longevity with

established sporting events including the Olympics.

5. Industry leader in market capitalization with $112 billion.

6. Return on Equity yielded 30 percent in 2006.

7. Leader of dividend yields of 2.6 percent. The company has had 43 consecutive years of an annual dividend increase.

8. Joint venture between The Coca Cola Company and Nestle has resulted in the establishment of Beverage Partners Worldwide (BPW).

9. Coca-Cola has formed a strong partnership with McDonalds, with McDonalds becoming their largest customer.

1. Product line is limited to beverages.

2. A failed $16 billion acquisition of Quaker Oats hinders long-term growth.

3. Negative publicity in India because of water issues, has led to poor brand image and hindered growth there.

4. Lack of management willingness to place foreign products into American markets.

5. Marketing deficiencies due to turnover in leadership and a 16 percent decrease in advertising spending.

6. Coca Cola’s inventory turnover is only 5.4 compared to Pepsi Co.’s 8.0.

Financial Ratio Analysis (December 2007)

Growth Rates % Coca Cola Industry SP-500Sales (Qtr vs year ago qtr) 19.20 22.20 11.60Net Income (YTD vs YTD) 8.30 25.70 17.10

Net Income (Qtr vs year ago qtr) 13.30 30.00 9.30Sales (5-Year Annual Avg.) 6.54 8.45 13.09Net Income (5-Year Annual Avg.) 5.01 9.38 19.82Dividends (5-Year Annual Avg.) 11.49 12.61 10.00Price RatiosCurrent P/E Ratio 25.4 26.2 20.3P/E Ratio 5-Year High NA 49.9 26.8P/E Ratio 5-Year Low NA 20.7 6.8Price/Sales Ratio 5.00 3.96 2.37Price/Book Value 6.97 5.71 3.45Price/Cash Flow Ratio 21.10 19.60 10.70Profit MarginsGross Margin 64.2 52.7 34.5Pre-Tax Margin 26.0 17.5 17.8Net Profit Margin 19.8 14.2 12.65Yr Gross Margin (5-Year Avg.) 64.4 59.1 34.35Yr PreTax Margin (5-Year Avg.) 27.9 20.1 16.45Yr Net Profit Margin (5-Year Avg.) 21.1 14.9 11.4Financial ConditionDebt/Equity Ratio 0.49 0.69 1.06Current Ratio 0.8 1.0 1.1Quick Ratio 0.6 0.7 0.9Interest Coverage 55.1 41.0 31.8Leverage Ratio 2.1 2.5 3.7Book Value/Share 8.52 10.25 18.53Investment Returns %Return On Equity 28.9 22.0 24.9Return On Assets 14.9 11.2 7.6Return On Capital 22.6 16.9 10.2Return On Equity (5-Year Avg.) 32.0 25.4 18.5Return On Assets (5-Year Avg.) 16.7 12.6 6.4Return On Capital (5-Year Avg.) 24.6 18.2 8.6Management EfficiencyIncome/Employee 76,690 56,327 92,892Revenue/Employee 386,732 360,922 806,706Receivable Turnover 9.8 10.1 14.3Inventory Turnover 5.4 6.8 7.8Asset Turnover 0.8 0.8 0.8Adapted from www.moneycentral.msn.com

Date Avg. P/E Price/Sales Price/Book Net Profit Margin (%)12/06 20.30 4.71 6.61 21.112/05 21.00 4.18 5.84 21.112/04 23.30 4.65 6.29 22.312/03 25.00 5.99 8.79 20.8

12/02 31.10 5.56 9.18 20.3

Date Book Value/ Share Debt/Equity ROE (%) ROA (%) Interest Coverage12/06 $7.30 0.27 30.0 17.0 28.712/05 $6.90 0.35 29.8 16.6 25.412/04 $6.61 0.45 30.4 15.4 29.112/03 $5.77 0.38 30.9 15.9 29.312/02 $4.78 0.45 33.7 16.3 27.4

Adapted from www.moneycentral.msn.com

Net Worth Analysis (December 2007 in millions)

1. Stockholders’ Equity + Goodwill = 17,000 + 1,400 $ 18,4002. Net income x 5 = $5,000 x 5= $ 25,0003. Share price = $58.00/EPS 2.34 =$24.78 x Net Income $5,000= $ 123,9314. Number of Shares Outstanding x Share Price = 1,600 x $58.00 = $ 92,800Method Average $65,032

Internal Factor Evaluation (IFE) Matrix

Key Internal Factors Weight Rating WeightedScore

Strengths1. Product line has over 400 brands. 0.09 4 0.36

2. Strong global presence, located in over 200 countries. 0.10 4 0.403. Long history has built excellent brand recognition. 0.06 4 0.244. Partnership longevity with established sporting events

including the Olympics.0.05 4 0.20

5. Industry leader in market capitalization with $112 billion.

0.12 4 0.48

6. Return on Equity yielded 30 percent in 2006. 0.04 4 0.127. Leader of dividend yields of 2.6 percent. The company

has had 43 consecutive years of an annual dividend increase.

0.04 4 0.16

8. Joint venture between The Coca Cola Company and Nestle has resulted in the establishment of Beverage Partners Worldwide (BPW).

0.06 4 0.24

9. Coca-Cola has formed a strong partnership with McDonalds, with McDonalds becoming their largest customer.

0.10 4 0.40

Weaknesses1. Product line is limited to beverages. 0.09 1 0.092. A failed $16 billion acquisition of Quaker Oats hinders

long-term growth.0.10 1 0.10

3. Negative publicity in India because of water issues, has led to poor brand image and hindered growth there.

0.03 2 0.06

4. Lack of management willingness to place foreign products into American markets.

0.02 2 0.04

5. Marketing deficiencies due to turnover in leadership and a 16 percent decrease in advertising spending.

0.05 2 0.10

6. Coca Cola’s inventory turnover is only 5.4 compared to Pepsi Co.’s 8.0.

0.05 2 0.10

TOTAL 1.00 3.09

\

SWOT Strategies

Strengths (S) Weaknesses (W) Opportunities (O) SO Strategies WO Strategies

1. Improve environmental awareness with community involvement (S2, S4, O2, O3).

2. Market new diet drinks that have healthier sugar substitutes (S5, O7).

1. Market international beverages to American consumers (W4, O2, O6, O7).

2. Increase marketing efforts for bottled water (W5, W6, O1).

Threats (T) ST Strategies

1. Acquire Krispy Kreme (KKD) to help diversify the product line (S5, T5).

2. Acquire Golden Enterprises (GLDC) to help diversify the product line (S5, T5).

WT Strategies

1. Acquire Krispy Kreme (KKD) to help diversify the product line (W1, T5).

2. Acquire Golden Enterprises (GLDC) to help diversify the product line (W1, T5).

SPACE Matrix Coordinate: (3.6, 2.2)

Return on Assets (ROA) 6 Rate of Inflation -3Leverage 6 Technological Changes -2Net Income 6 Price Elasticity of Demand -2Income/Employee 6 Competitive Pressure -6Inventory Turnover 3 Barriers to Entry into Market -3

5.4 -3.2Environmental Stability (ES) Average Financial Strength (FS) Average

Environmental Stability (ES)Financial Strength (FS)

Market Share -1 Growth Potential 5Product Quality -1 Financial Stability 6Customer Loyalty -1 Ease of Entry into Market 4Technological know-how -2 Resource Utilization 5Control over Suppliers and Distributors -2 Profit Potential 5

-1.4 5.0Competitive Advantage (CA) Average Industry Strength (IS) Average

Competitive Advantage (CA) Industry Strength (IS)

x-axis: -1.4 + 5.0 = 3.6y-axis: 5.4 + -3.2 = 2.2Coordinate: (3.6, 2.2)

Grand Strategy Matrix

Conservative Aggressive

CompetitiveDefensive

FS

ISCA

ES

The Boston Consulting Group (BCG) Matrix

The Internal-External (IE) Matrix

The IFE Total Weighted Score

Quadrant II Quadrant I

Quadrant IVQuadrant III

Rapid Market Growth

Strong Competitive

Position

WeakCompetitive

Position

Slow Market Growth

Question Marks

Cash Cows Dogs

Relative Market Share Position

IndustrySales

GrowthRate

Stars Coke

Strong Average Weak3.0 to 4.0 2.0 to 2.99 1.0 to 1.99

High I II III

3.0 to 3.99

Medium IV V VI

The EFE Total Weighted Score

2.0 to 2.99

Coca Cola

Low VII VIII IX

1.0 to 1.99

Grow and Build

Divisions Percent Revenue 2006North America 29.1Bottling Investments 21.2North Asia, Eurasia & Middle East 16.5European Union 14.6Latin America 10.3Africa 4.6East, South Asia & Pacific Rim 3.3Corporate 0.4

QSPM

Strategic Alternatives

Key Internal Factors Weight

Acquire KKD and GLDC

Produce new diet drinks that have healthier sugar

substitutesStrengths AS TAS AS TAS1. Product line has over 400 brands. 0.09 2 0.18 4 0.362. Strong global presence, located in over 200

countries.0.10 --- --- --- ---

3. Long history has built excellent brand recognition. 0.06 2 0.12 4 0.244. Partnership longevity with established sporting

events including the Olympics.0.05 --- --- --- ---

5. Industry leader in market capitalization with $112 billion.

0.12 4 0.48 3 0.36

6. Return on Equity yielded 30 percent in 2006. 0.04 4 0.16 3 0.127. Leader of dividend yields of 2.6 percent. The

company has had 43 consecutive years of an annual dividend increase.

0.04 --- --- --- ---

8. Joint venture between The Coca Cola Company and Nestle has resulted in the establishment of Beverage Partners Worldwide (BPW).

0.06 --- --- --- ---

9. Coca-Cola has formed a strong partnership with McDonalds, with McDonalds becoming their largest customer.

0.10 --- --- --- ---

Weaknesses1. Product line is limited to beverages. 0.09 4 0.36 1 0.092. A failed $16 billion acquisition of Quaker Oats

hinders long-term growth.0.10 --- --- --- ---

3. Negative publicity in India because of water issues, has led to poor brand image and hindered growth there.

0.03 --- --- --- ---

4. Lack of management willingness to place foreign products into American markets.

0.02 --- --- --- ---

5. Marketing deficiencies due to turnover in leadership and a 16 percent decrease in advertising spending.

0.05 --- --- --- ---

6. Coca Cola’s inventory turnover is only 5.4 compared to Pepsi Co.’s 8.0.

0.05 4 0.20 1 0.05

SUBTOTAL 1.00 1.50 1.22

Key External Factors Weight Acquire KKD and

GLDCProduce new diet drinks that have healthier sugar

substitutesOpportunities AS TAS AS TAS1. Bottled water consumption has increased 11 percent. 0.06 --- --- --- ---2. According to the S&P Industry Survey, consumers

are drawn to new smaller beverage brands that are not sold on a mass scale.

0.05 1 0.05 3 0.15

3. Word Economic Forum’s annual Davos, Switzerland gathering grants international voice.

0.02 --- --- --- ---

4. Less developed countries are in desperate need to improve community water supplies.

0.02 --- --- --- ---

5. Energy drink sales are expected to increase 7 to 8 percent in 2007.

0.06 --- --- --- ---

6. Disposable income has increased 6.2 percent. 0.05 --- --- --- ---7. Consumers are striving to drink and eat their way to

better health than pervious generations.0.07 2 0.14 4 0.28

8. EPS is expected to rise 7 to 8 percent in 2007. 0.07 4 0.28 3 0.21Threats1. Consumption of American beverages is denounced

by foreign officials in areas where conflicting interest exist.

0.02 --- --- --- ---

2. Multiple lawsuits against the new Enviga beverage for calorie burning claims in advertising

0.04 --- --- --- ---

3. Smaller, lesser known brands are turning to major beer distributors for bottling.

0.06 --- --- --- ---

4. Overall carbonated drink sales have been flat due to links of sugar to obesity and high fructose corn syrup to heart disease.

0.10 2 0.20 4 0.40

5. Pepsi is more diversified offering beverage and food products.

0.20 4 0.80 2 0.40

6. High cost of commodities such as sugar, and metals used in production of cans.

0.10 --- --- --- ---

7. Many smaller companies are fierce competitors around the world in their local markets.

0.08 --- --- --- ---

SUB TOTAL 1.47 1.44SUM TOTAL ATTRACTIVENESS SCORE 2.97 2.66

Recommendations

The QSPM strategies assessed whether acquiring KKD and GLDC (a potato chip and snack food company) was a better option than producing a new diet soda line made form more healthy sugar alternatives. Both scores on the QSPM are relatively close and given the financial condition of KKD and GLDC, it is recommended Coca Cola undertake both strategic alternatives. The Net Worth of both companies is provided below. It is estimated it would cost $200 million to research, produce and market the new diet drinks.

Krispy Kreme (KKD) Net Worth January 2008 (in millions).

1. Stockholders’ Equity + Goodwill = 79 + 28 $ 1072. Net income x 5 = $-42 x 5= $ NA3. Share price = $2.73/EPS -0.94 = NAx Net Income $-42= $ NA4. Number of Shares Outstanding x Share Price = 65 x $2.73 = $ 177Method Average $142

Golden Enterprises (GLDC) Net Worth January 2008 (in millions).

1. Stockholders’ Equity + Goodwill = 19.4 + 0 $ 19.42. Net income x 5 = $1.2 x 5= $ 6.03. Share price = $2.95/EPS 0.19 =$15.52 x Net Income $1.2= $ 18.64. Number of Shares Outstanding x Share Price = 11.2 x $2.95 = $ 33.0Method Average $19.3

EPS/EBIT Analysis

$ Amount Needed: 360M

Stock Price: $58Tax Rate: 35%Interest Rate: 5%# Shares Outstanding: 1,600M

Recession Normal Boom Recession Normal Boom

EBIT 4,000,000,000 6,000,000,000 8,000,000,000 4,000,000,000 6,000,000,000 8,000,000,000Interest 0 0 0 18,000,000 18,000,000 18,000,000EBT 4,000,000,000 6,000,000,000 8,000,000,000 3,982,000,000 5,982,000,000 7,982,000,000Taxes 1,400,000,000 2,100,000,000 2,800,000,000 1,393,700,000 2,093,700,000 2,793,700,000EAT 2,600,000,000 3,900,000,000 5,200,000,000 2,588,300,000 3,888,300,000 5,188,300,000# Shares 1,606,206,897 1,606,206,897 1,606,206,897 1,600,000,000 1,600,000,000 1,600,000,000EPS 1.62 2.43 3.24 1.62 2.43 3.24

Common Stock Financing Debt Financing

70 Percent Stock - 30 Percent Debt 70 Percent Debt - 30 Percent StockRecession Normal Boom Recession Normal Boom

EBIT 4,000,000,000 6,000,000,000 8,000,000,000 4,000,000,000 6,000,000,000 8,000,000,000Interest 5,400,000 5,400,000 5,400,000 12,600,000 12,600,000 12,600,000EBT 3,994,600,000 5,994,600,000 7,994,600,000 3,987,400,000 5,987,400,000 7,987,400,000Taxes 1,398,110,000 2,098,110,000 2,798,110,000 1,395,590,000 2,095,590,000 2,795,590,000EAT 2,596,490,000 3,896,490,000 5,196,490,000 2,591,810,000 3,891,810,000 5,191,810,000# Shares 1,604,344,828 1,604,344,828 1,604,344,828 1,601,862,069 1,601,862,069 1,601,862,069EPS 1.62 2.43 3.24 1.62 2.43 3.24

References1. www.moneycentral.msn.com

2. www. coca - cola .com 3. Strategic Management concepts and cases by Fred David 12 edition4. Exploring Corporate Strategy text & cases 8th edition