coke-8k_20180508.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported):

May 8, 2018

 

COCA-COLA BOTTLING CO. CONSOLIDATED

(Exact name of registrant as specified in its charter)

 

 

Delaware

  

0-9286

  

56-0950585

(State or other jurisdiction

of incorporation)

  

(Commission

File Number)

  

(IRS Employer

Identification No.)

 

4100 Coca-Cola Plaza, Charlotte, North Carolina 28211

(Address of principal executive offices) (Zip Code)

(704) 557-4400

(Registrant's telephone number, including area code)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 



Item 2.02.Results of Operations and Financial Condition.

 

On May 8, 2018, Coca-Cola Bottling Co. Consolidated (the “Company”) issued a news release announcing its financial results for the first quarter ended April 1, 2018. A copy of the news release is furnished as Exhibit 99.1 hereto.

 

 

Item 9.01.Financial Statements and Exhibits.

 

(d)  Exhibits.

 

 

99.1

News release issued on May 8, 2018, reporting the Company’s financial results for the first quarter ended April 1, 2018.

 

 


Signature

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COCA-COLA BOTTLING CO. CONSOLIDATED

(REGISTRANT)

 

 

 

 

Date: May 8, 2018

 

 

 

By:

 

/s/ David M. Katz

 

 

 

 

 

 

 

 

David M. Katz

Executive Vice President and Chief Financial Officer

 

 

 

coke-ex991_6.htm

Exhibit 99.1

 

 

MEDIA CONTACT:

Kimberly Kuo

Senior Vice President

Public Affairs, Communications & Communities

Kimberly.Kuo@ccbcc.com

(704) 557-4584

 

INVESTOR CONTACT:

Dave Katz

Executive Vice President & Chief Financial Officer

 

 

Dave.Katz@ccbcc.com

(704) 557-4929

 

 

First Quarter 2018 Highlights

 

Q1 net sales growth of 23.8%, including organic(a) net sales growth of 2.4%.

 

 

“Our industry continues to face some challenges, including higher commodity and transportation costs. Despite these headwinds, we’re pleased we achieved solid volume and sales growth. As we continue to integrate our teams and transition our business platform, we are extremely appreciative of the commitment of our employees and remain sharply focused on investing strategically in order to position our business for long-term success.”

 

- Frank Harrison

Chairman & CEO

Coca‑Cola Consolidated

 

 

 

 

 

Q1 sales volume growth of 19.6%, including organic(a) volume growth of 2.2%.

 

 

 

 

 

 

 

Reported basic EPS of ($1.52) in Q1 2018, as compared to basic EPS of ($0.54) in Q1 2017.

 

 

 

 

 

 

 

Gross margin decline of 440 basis points from Q1 2017 driven by higher commodity and transportation costs, a higher mix of sales from lower-margin acquired territories, and shifting product mix.

 

 

 

 

 

 

 

Taking actions to address headwinds experienced in Q1 2018.

 

 

 

 

Key Results

 

 

 

First Quarter

 

 

 

 

 

 

 

 

 

(in millions, except per share data)

 

2018

 

 

2017

 

 

Change

 

 

% Change

 

Physical case volume

 

 

78.0

 

 

 

65.2

 

 

 

12.8

 

 

 

19.6

%

Net sales

 

$

1,072.1

 

 

$

865.7

 

 

$

206.4

 

 

 

23.8

%

Gross profit

 

$

364.9

 

 

$

332.0

 

 

$

32.9

 

 

 

9.9

%

Gross margin

 

 

34.0

%

 

 

38.4

%

 

 

 

 

 

 

 

 

Income (loss) from operations

 

$

(19.0

)

 

$

15.0

 

 

$

(34.0

)

 

N/M

 

Basic net loss per share

 

$

(1.52

)

 

$

(0.54

)

 

$

(0.98

)

 

N/M

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bottle/Can Sales

 

First Quarter

 

 

 

 

 

 

 

 

 

(in millions)

 

2018

 

 

2017

 

 

Change

 

 

% Change

 

Sparkling beverages

 

$

562.7

 

 

$

479.8

 

 

$

82.9

 

 

 

17.3

%

Still beverages

 

$

324.6

 

 

$

256.1

 

 

$

68.5

 

 

 

26.7

%

 

(a)  The discussion of the first quarter results includes selected non-GAAP financial information, such as “organic” results. Organic net sales and organic sales volume include results from our distribution territories not impacted by acquisition or divestiture activity during 2017. The schedules in this press release reconcile such non-GAAP measures to the most directly comparable GAAP financial measures.


 

First Quarter 2018 Review

 

CHARLOTTE, May 8, 2018 – Coca‑Cola Bottling Co. Consolidated (NASDAQ:COKE) today reported operating results for the first quarter ended April 1, 2018.

 

Our Company delivered strong volume and sales growth during the first quarter of 2018. Volume increased to 78.0 million physical cases in Q1 2018, from 65.2 million physical cases in Q1 2017, an increase of 19.6%. Most of this growth was driven by acquisition (net of divestitures) results, as well as organic volume growth of 2.2%. In addition, we achieved price and mix realization greater than volume growth, which drove net sales growth of 23.8% for our total business and 2.4% organic growth. These results were driven by growth in both the sparkling and still beverage categories, with sparkling bottle/can sales growing 17.3% and still bottle/can sales growing 26.7%. While these volume and net sales results were strong, we believe poor weather and product sourcing challenges associated with our evolving integrated business platform exerted significant pressure on our Q1 2018 results, as compared to Q1 2017. This pressure was partially offset by the shift of the Easter holiday.

 

While volume and top line growth were strong, we experienced margin compression compared to the same period last year. Gross margin declined to 34.0% in Q1 2018 from 38.4% in Q1 2017. The primary drivers of this margin compression were (i) recent commodity and transportation cost pressures, (ii) the acquisition of new territories that generally experience margins lower than our legacy territories, and (iii) the continued volume shift to lower-margin still products to meet changing consumer preferences. We expect these drivers to continue throughout 2018, and we are taking pricing actions in certain markets to help offset the cost pressures. In addition to the operating headwinds in our business, structural changes in our underlying financial results reduced reported gross margin, which included (i) the amortization of our legacy distribution rights that converted from franchise rights in Q2 2017, and (ii) the new profit margin structure on sales to other Coca‑Cola bottlers as part of a Coca‑Cola system governance agreement. Incremental amortization expense related to converted legacy distribution rights in Q1 2018 totaled $2.2 million. Total sales to other Coca‑Cola bottlers in Q1 2018 totaled $101.7 million, as compared to $64.7 million in Q1 2017, an increase of $37.0 million or 57.2%.

 

Selling, delivery and administrative expenses increased by $66.8 million, or 21.1%, in Q1 2018 as compared to Q1 2017, reflecting the increased volume delivered, incremental effort and costs associated with managing two ERP systems and our continued costs to integrate our acquired territory into our overall business. While we were successful in leveraging our selling, delivery and administrative expenses on increased sales volume, we believe there are additional opportunities to secure scale advantages and further leverage our cost structure against our expanded territories. Initiatives are underway to address these scale opportunities, including both operational and back office synergies.

 

Income (loss) from operations in Q1 2018 was lower than in Q1 2017. We experienced an operating loss of $19.0 million in Q1 2018, as compared to operating income of $15.0 million in Q1 2017.

 

While we completed our system transformation acquisitions and divestitures in October 2017, we continue integrating the acquired distribution territories, manufacturing facilities and related operations and investing resources to improve efficiencies, capabilities and market share. While doing so, we are focused on balancing these investments with our overall financial management strategy and debt reduction goals. We have revised our capital spending plans for the balance of 2018 in order to optimize our focus on strategic capital priorities and operational initiatives. We now estimate spending between $160 million and $180 million on capital expenditures in 2018, as compared to our previous estimated range of $200 million to $230 million.

 

We also continue to devote significant time and resources to our system transformation work, particularly converting all of our legacy information technology systems to the new CONA system which, when completed, will enable us to operate on one integrated information technology system going forward. We expect this conversion to be completed later this year. During Q1 2018, we incurred non-recurring expenses relating to our system transformation of approximately $12.5 million, the majority of which were IT-related costs. We anticipate incurring an additional $30 million to $35 million of related expenses in the remainder of 2018.



 

About Coca‑Cola Bottling Co. Consolidated

 

Coca‑Cola Consolidated is the largest Coca-Cola bottler in the United States. Our Purpose is to honor God, serve others, pursue excellence and grow profitably. For more than 115 years, we have been deeply committed to the consumers, customers, and communities we serve and passionate about the broad portfolio of beverages and services we offer. We make, sell, and deliver beverages of The Coca‑Cola Company and other partner companies in more than 300 brands and flavors to 65 million consumers in territories spanning 14 states and the District of Columbia.

 

Headquartered in Charlotte, N.C., Coca‑Cola Consolidated is traded on the NASDAQ under the symbol COKE. More information about the company is available at www.cokeconsolidated.com. Follow Coca‑Cola Consolidated on Facebook, Twitter, Instagram and LinkedIn.

 

Cautionary Information Regarding Forward-Looking Statements

 

Certain statements contained in this news release are “forward-looking statements” that involve risks and uncertainties. The words “believe,” “expect,” “project,” “will,” “should,” “could” and similar expressions are intended to identify those forward-looking statements. Factors that might cause Coca‑Cola Consolidated’s actual results to differ materially from those anticipated in forward-looking statements include, but are not limited to: our inability to integrate the operations and employees acquired in system transformation transactions; lower than expected selling pricing resulting from increased marketplace competition; changes in how significant customers market or promote our products; changes in our top customer relationships; changes in public and consumer preferences related to nonalcoholic beverages, including concerns related to obesity and health concerns; unfavorable changes in the general economy; miscalculation of our need for infrastructure investment; our inability to meet requirements under beverage agreements; material changes in the performance requirements for marketing funding support or our inability to meet such requirements; decreases from historic levels of marketing funding support; changes in The Coca‑Cola Company’s and other beverage companies’ levels of advertising, marketing and spending on brand innovation; the inability of our aluminum can or plastic bottle suppliers to meet our purchase requirements; our inability to offset higher raw material costs with higher selling prices, increased bottle/can sales volume or reduced expenses; consolidation of raw material suppliers; incremental risks resulting from increased purchases of finished goods; sustained increases in fuel costs or our inability to secure adequate supplies of fuel; sustained increases in the cost of labor and employment matters, product liability claims or product recalls; technology failures or cyberattacks; changes in interest rates; the impact of debt levels on operating flexibility and access to capital and credit markets; adverse changes in our credit rating (whether as a result of our operations or prospects or as a result of those of The Coca‑Cola Company or other bottlers in the Coca‑Cola system); changes in legal contingencies; legislative changes affecting our distribution and packaging; adoption of significant product labeling or warning requirements; additional taxes resulting from tax audits; natural disasters and unfavorable weather; global climate change or legal or regulatory responses to such change; issues surrounding labor relations with unionized employees; bottler system disputes; our use of estimates and assumptions; changes in accounting standards; the impact of volatility in the financial markets on access to the credit markets; the impact of acquisitions or dispositions of bottlers by their franchisors; changes in the inputs used to calculate our acquisition related contingent consideration liability; and the concentration of our capital stock ownership. These and other factors are discussed in the Company’s regulatory filings with the Securities and Exchange Commission, including those in the Company’s fiscal 2017 Annual Report on Form 10‑K, Item 1A. Risk Factors. The forward-looking statements contained in this news release speak only as of this date, and the Company does not assume any obligation to update them except as required by law.

 

###

 

 



 

 

 

 

 

FINANCIAL STATEMENTS

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

(UNAUDITED)

 

 

 

 

 

First Quarter

 

(in thousands, except per share data)

 

2018

 

 

2017

 

Net sales

 

$

1,072,064

 

 

$

865,702

 

Cost of sales

 

 

707,116

 

 

 

533,681

 

Gross profit

 

 

364,948

 

 

 

332,021

 

Selling, delivery and administrative expenses

 

 

383,945

 

 

 

317,071

 

Income (loss) from operations

 

 

(18,997

)

 

 

14,950

 

Interest expense, net

 

 

12,046

 

 

 

9,470

 

Other income (expense), net

 

 

4,510

 

 

 

(13,588

)

Loss before income taxes

 

 

(26,533

)

 

 

(8,108

)

Income tax benefit

 

 

(12,971

)

 

 

(3,691

)

Net loss

 

 

(13,562

)

 

 

(4,417

)

Less: Net income attributable to noncontrolling interest

 

 

623

 

 

 

634

 

Net loss attributable to Coca-Cola Bottling Co. Consolidated

 

$

(14,185

)

 

$

(5,051

)

 

 

 

 

 

 

 

 

 

Basic net loss per share based on net loss attributable to Coca-Cola Bottling Co. Consolidated:

 

 

 

 

 

 

 

 

Common Stock

 

$

(1.52

)

 

$

(0.54

)

Weighted average number of Common Stock shares outstanding

 

 

7,141

 

 

 

7,141

 

 

 

 

 

 

 

 

 

 

Class B Common Stock

 

$

(1.52

)

 

$

(0.54

)

Weighted average number of Class B Common Stock shares outstanding

 

 

2,199

 

 

 

2,178

 

 

 

 

 

 

 

 

 

 

Diluted net loss per share based on net loss attributable to Coca-Cola Bottling Co. Consolidated:

 

 

 

 

 

 

 

 

Common Stock

 

$

(1.52

)

 

$

(0.54

)

Weighted average number of Common Stock shares outstanding – assuming dilution

 

 

9,340

 

 

 

9,319

 

 

 

 

 

 

 

 

 

 

Class B Common Stock

 

$

(1.52

)

 

$

(0.54

)

Weighted average number of Class B Common Stock shares outstanding – assuming dilution

 

 

2,199

 

 

 

2,178

 

 



 

 

 

 

 

FINANCIAL STATEMENTS

CONSOLIDATED CONDENSED BALANCE SHEETS

(UNAUDITED)

 

 

 

(in thousands)

 

April 1, 2018

 

 

December 31, 2017

 

ASSETS

 

 

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

8,479

 

 

$

16,902

 

Trade accounts receivable, net

 

 

412,455

 

 

 

388,416

 

Accounts receivable, other

 

 

92,485

 

 

 

104,956

 

Inventories

 

 

207,163

 

 

 

183,618

 

Prepaid expenses and other current assets

 

 

108,319

 

 

 

100,646

 

Total current assets

 

 

828,901

 

 

 

794,538

 

Property, plant and equipment, net

 

 

1,022,325

 

 

 

1,031,388

 

Leased property under capital leases, net

 

 

28,175

 

 

 

29,837

 

Other assets

 

 

115,519

 

 

 

116,209

 

Goodwill

 

 

170,262

 

 

 

169,316

 

Other identifiable intangible assets, net

 

 

925,261

 

 

 

931,672

 

Total assets

 

$

3,090,443

 

 

$

3,072,960

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

 

 

Current portion of obligations under capital leases

 

$

8,265

 

 

$

8,221

 

Accounts payable and accrued expenses

 

 

566,691

 

 

 

631,231

 

Total current liabilities

 

 

574,956

 

 

 

639,452

 

Deferred income taxes

 

 

97,471

 

 

 

112,364

 

Pension and postretirement benefit obligations and other liabilities

 

 

726,174

 

 

 

738,971

 

Long-term debt and obligations under capital leases

 

 

1,244,260

 

 

 

1,123,266

 

Total liabilities

 

 

2,642,861

 

 

 

2,614,053

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

354,754

 

 

 

366,702

 

Noncontrolling interest

 

 

92,828

 

 

 

92,205

 

Total liabilities and equity

 

$

3,090,443

 

 

$

3,072,960

 

 

 

 

 



 

 

 

 

 

FINANCIAL STATEMENTS

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(UNAUDITED)

 

 

 

 

 

First Quarter

 

(in thousands)

 

2018

 

 

2017

 

Cash Flows from Operating Activities:

 

 

 

 

 

 

 

 

Net loss

 

$

(13,562

)

 

$

(4,417

)

Depreciation expense and amortization of intangible assets and deferred proceeds, net

 

 

47,220

 

 

 

34,981

 

Deferred income taxes

 

 

(15,394

)

 

 

(15,495

)

Proceeds from bottling agreements conversion

 

 

-

 

 

 

87,066

 

Stock compensation expense

 

 

752

 

 

 

2,060

 

Fair value adjustment of acquisition related contingent consideration

 

 

(5,186

)

 

 

12,246

 

Change in assets and liabilities (exclusive of acquisitions)

 

 

(96,817

)

 

 

(1,014

)

Other

 

 

2,241

 

 

 

1,091

 

Net cash provided by (used in) operating activities

 

 

(80,746

)

 

 

116,518

 

 

 

 

 

 

 

 

 

 

Cash Flows from Investing Activities:

 

 

 

 

 

 

 

 

Acquisition of distribution territories and regional manufacturing facilities related investing activities

 

 

-

 

 

 

(155,556

)

Additions to property, plant and equipment (exclusive of acquisitions)

 

 

(42,048

)

 

 

(41,580

)

Other

 

 

1,824

 

 

 

77

 

Net cash used in investing activities

 

 

(40,224

)

 

 

(197,059

)

 

 

 

 

 

 

 

 

 

Cash Flows from Financing Activities:

 

 

 

 

 

 

 

 

Borrowings under Revolving Credit Facility and Term Loan Facility and proceeds from issuance of Senior Notes

 

 

320,000

 

 

 

245,000

 

Payments on Revolving Credit Facility and Senior Notes

 

 

(197,000

)

 

 

(150,000

)

Cash dividends paid

 

 

(2,333

)

 

 

(2,328

)

Payment of acquisition related contingent consideration

 

 

(5,882

)

 

 

-

 

Principal payments on capital lease obligations

 

 

(2,053

)

 

 

(1,828

)

Debt issuance fees

 

 

(185

)

 

 

(213

)

Net cash provided by financing activities

 

 

112,547

 

 

 

90,631

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) in cash during period

 

 

(8,423

)

 

 

10,090

 

Cash at beginning of period

 

 

16,902

 

 

 

21,850

 

Cash at end of period

 

$

8,479

 

 

$

31,940

 

 



 

 

 

 

 

NON-GAAP FINANCIAL MEASURES(1)

The following tables reconcile reported GAAP results to organic/adjusted results (non-GAAP) for Q1 2018 and Q1 2017:

 

 

 

First Quarter

 

 

 

 

 

 

 

 

 

 

 

(in thousands)

 

2018

 

 

2017

 

 

 

 

 

 

 

 

 

 

 

Total bottle/can sales

 

$

887,233

 

 

$

735,818

 

 

 

 

 

 

 

 

 

 

 

Total other sales

 

 

184,831

 

 

 

129,884

 

 

 

 

 

 

 

 

 

 

 

Total net sales

 

$

1,072,064

 

 

$

865,702

 

 

 

 

First Quarter

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

2018

 

 

2017

 

Total bottle/can sales

 

$

887,233

 

 

$

735,818

 

 

Physical case volume

 

 

78.0

 

 

 

65.2

 

Less: Acquisition/divestiture related sales

 

 

260,843

 

 

 

123,935

 

 

Less: Acquisition/divestiture related physical case volume

 

 

22.5

 

 

 

10.9

 

Organic net sales (non-GAAP)

 

$

626,390

 

 

$

611,883

 

 

Organic physical case volume

 

 

55.5

 

 

 

54.3

 

increase in organic net sales

 

 

2.4

%

 

 

 

 

 

increase in organic physical case volume

 

 

2.2

%

 

 

 

 

 

 

 

First Quarter 2018

 

(in thousands, except per share data)

 

Net sales

 

 

Gross

profit

 

 

Loss from

operations

 

 

Loss before

income taxes

 

 

Net loss

 

 

Basic net loss

per share

 

Reported results (GAAP)

 

$

1,072,064

 

 

$

364,948

 

 

$

(18,997

)

 

$

(26,533

)

 

$

(14,185

)

 

$

(1.52

)

System transformation transactions expenses

 

 

-

 

 

 

199

 

 

 

12,450

 

 

 

12,450

 

 

 

9,362

 

 

 

1.00

 

Fair value adjustment of acquisition related contingent consideration

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(5,186

)

 

 

(3,900

)

 

 

(0.42

)

Amortization of converted distribution rights, net

 

 

-

 

 

 

2,231

 

 

 

2,231

 

 

 

2,231

 

 

 

1,678

 

 

 

0.18

 

Fair value adjustments for commodity hedges

 

 

-

 

 

 

2,765

 

 

 

2,967

 

 

 

2,967

 

 

 

2,231

 

 

 

0.24

 

Other tax adjustments

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(2,856

)

 

 

(0.30

)

Total reconciling items

 

 

-

 

 

 

5,195

 

 

 

17,648

 

 

 

12,462

 

 

 

6,515

 

 

 

0.70

 

Adjusted results (non-GAAP)

 

$

1,072,064

 

 

$

370,143

 

 

$

(1,349

)

 

$

(14,071

)

 

$

(7,670

)

 

$

(0.82

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

First Quarter 2017

 

(in thousands, except per share data)

 

Net sales

 

 

Gross

profit

 

 

Income from

operations

 

 

Income (loss) before

income taxes

 

 

Net income (loss)

 

 

Basic net income (loss) per share

 

Reported results (GAAP)

 

$

865,702

 

 

$

332,021

 

 

$

14,950

 

 

$

(8,108

)

 

$

(5,051

)

 

$

(0.54

)

System transformation transactions expenses

 

 

-

 

 

 

88

 

 

 

7,652

 

 

 

7,652

 

 

 

4,714

 

 

 

0.51

 

Fair value adjustment of acquisition related contingent consideration

 

 

-

 

 

 

-

 

 

 

-

 

 

 

12,246

 

 

 

7,544

 

 

 

0.81

 

Fair value adjustments for commodity hedges

 

 

-

 

 

 

(698

)

 

 

(327

)

 

 

(327

)

 

 

(201

)

 

 

(0.02

)

Other tax adjustments

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(747

)

 

 

(0.09

)

Total reconciling items

 

 

-

 

 

 

(610

)

 

 

7,325

 

 

 

19,571

 

 

 

11,310

 

 

 

1.21

 

Adjusted results (non-GAAP)

 

$

865,702

 

 

$

331,411

 

 

$

22,275

 

 

$

11,463

 

 

$

6,259

 

 

$

0.67

 

 

(1)

The Company reports its financial results in accordance with U.S. generally accepted accounting principles (“GAAP”). However, management believes that certain non-GAAP financial measures provide users with additional meaningful financial information that should be considered when assessing the Company’s ongoing performance. Further, given the transformation of the Company’s business through System Transformation transactions with The Coca‑Cola Company and the conversion of its information technology systems, the Company believes these non-GAAP financial measures allow users to better appreciate the impact of these transactions on the Company’s performance. Management also uses these non-GAAP financial measures in making financial, operating and planning decisions and in evaluating the Company’s performance. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company’s reported results prepared in accordance with GAAP. The Company’s non-GAAP financial information does not represent a comprehensive basis of accounting.