| Comprehensive Income |
OTHER COMPREHENSIVE INCOME
AOCI attributable to shareowners of The Coca-Cola Company is separately presented in our condensed consolidated balance sheets as a component of The Coca-Cola Company's shareowners' equity, which also includes our proportionate share of equity method investees' AOCI. OCI attributable to noncontrolling interests is allocated to, and included in, our condensed consolidated balance sheets as part of the line item equity attributable to noncontrolling interests.
AOCI attributable to shareowners of The Coca-Cola Company consisted of the following, net of tax (in millions):
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|
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|
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|
September 28,
2018 |
|
|
December 31, 2017 |
|
Foreign currency translation adjustments |
$ |
(10,616 |
) |
|
$ |
(8,957 |
) |
Accumulated derivative net gains (losses) |
(97 |
) |
|
(119 |
) |
Unrealized net gains (losses) on available-for-sale securities1
|
(7 |
) |
|
493 |
|
Adjustments to pension and other benefit liabilities |
(1,350 |
) |
|
(1,722 |
) |
Accumulated other comprehensive income (loss) |
$ |
(12,070 |
) |
|
$ |
(10,305 |
) |
1 The change in the balance from December 31, 2017 includes the $409 million reclassification to retained earnings upon the adoption of ASU
2016-01. Refer to Note 1 and Note 4.
The following table summarizes the allocation of total comprehensive income between shareowners of The Coca-Cola Company and noncontrolling interests (in millions):
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|
|
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|
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|
Nine Months Ended September 28, 2018 |
|
Shareowners of
The Coca-Cola Company
|
|
Noncontrolling
Interests
|
|
Total |
|
Consolidated net income |
$ |
5,564 |
|
$ |
(15 |
) |
$ |
5,549 |
|
Other comprehensive income: |
|
|
|
Net foreign currency translation adjustments |
(1,659 |
) |
24 |
|
(1,635 |
) |
Net gains (losses) on derivatives1
|
22 |
|
— |
|
22 |
|
|
Net change in unrealized gain (loss) on available-for-sale debt
securities2
|
(91 |
) |
— |
|
(91 |
) |
Net change in pension and other benefit liabilities3
|
372 |
|
— |
|
372 |
|
Total comprehensive income |
$ |
4,208 |
|
$ |
9 |
|
$ |
4,217 |
|
1 Refer to Note 6 for additional information related to the net gains or losses on derivative instruments designated and qualifying as cash flow hedging instruments.
2 Refer to Note 4 for additional information related to the net unrealized gains or losses on available-for-sale debt securities.
3 Refer to Note 13 for additional information related to the Company's pension and other postretirement benefit liabilities.
The following tables present OCI attributable to shareowners of The Coca-Cola Company, including our proportionate share of equity method investees' OCI (in millions):
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|
|
|
|
|
|
|
Three Months Ended September 28, 2018 |
Before-Tax Amount |
|
|
Income Tax |
|
|
After-Tax Amount |
|
Foreign currency translation adjustments: |
|
|
|
|
|
Translation adjustments arising during the period |
$ |
(446 |
) |
|
$ |
19 |
|
|
$ |
(427 |
) |
Reclassification adjustments recognized in net income |
170 |
|
|
— |
|
|
170 |
|
Gains (losses) on intra-entity transactions that are of a long-term investment nature |
(119 |
) |
|
— |
|
|
(119 |
) |
Gains (losses) on net investment hedges arising during the period1
|
59 |
|
|
(15 |
) |
|
44 |
|
Net foreign currency translation adjustments |
$ |
(336 |
) |
|
$ |
4 |
|
|
$ |
(332 |
) |
Derivatives: |
|
|
|
|
|
Gains (losses) arising during the period |
$ |
19 |
|
|
$ |
(7 |
) |
|
$ |
12 |
|
Reclassification adjustments recognized in net income |
(58 |
) |
|
16 |
|
|
(42 |
) |
Net gains (losses) on derivatives1
|
$ |
(39 |
) |
|
$ |
9 |
|
|
$ |
(30 |
) |
Available-for-sale debt securities: |
|
|
|
|
|
Unrealized gains (losses) arising during the period |
$ |
(13 |
) |
|
$ |
24 |
|
|
$ |
11 |
|
Reclassification adjustments recognized in net income |
(3 |
) |
|
2 |
|
|
(1 |
) |
Net change in unrealized gain (loss) on available-for-sale debt securities2
|
$ |
(16 |
) |
|
$ |
26 |
|
|
$ |
10 |
|
Pension and other benefit liabilities: |
|
|
|
|
|
Net pension and other benefit liabilities arising during the period |
$ |
7 |
|
|
$ |
— |
|
|
$ |
7 |
|
Reclassification adjustments recognized in net income |
65 |
|
|
(16 |
) |
|
49 |
|
Net change in pension and other benefit liabilities3
|
$ |
72 |
|
|
$ |
(16 |
) |
|
$ |
56 |
|
|
Other comprehensive income (loss) attributable to shareowners of The Coca-Cola
Company
|
$ |
(319 |
) |
|
$ |
23 |
|
|
$ |
(296 |
) |
|
|
1 |
Refer to Note 6 for additional information related to the net gains or losses on derivative instruments designated and qualifying as cash flow hedging instruments.
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2 |
Includes reclassification adjustments related to divestitures of certain available-for-sale debt securities. Refer to Note 4 for additional information related to these divestitures.
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3 |
Refer to Note 13 for additional information related to the Company's pension and other postretirement benefit liabilities.
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|
Nine Months Ended September 28, 2018 |
Before-Tax Amount |
|
|
Income Tax |
|
|
After-Tax Amount |
|
Foreign currency translation adjustments: |
|
|
|
|
|
Translation adjustments arising during the period |
$ |
(1,431 |
) |
|
$ |
(66 |
) |
|
$ |
(1,497 |
) |
Reclassification adjustments recognized in net income |
268 |
|
|
— |
|
|
268 |
|
Gains (losses) on intra-entity transactions that are of a long-term investment nature |
(695 |
) |
|
— |
|
|
(695 |
) |
Gains (losses) on net investment hedges arising during the period1
|
353 |
|
|
(88 |
) |
|
265 |
|
Net foreign currency translation adjustments |
$ |
(1,505 |
) |
|
$ |
(154 |
) |
|
$ |
(1,659 |
) |
Derivatives: |
|
|
|
|
|
Gains (losses) arising during the period |
$ |
84 |
|
|
$ |
(21 |
) |
|
$ |
63 |
|
Reclassification adjustments recognized in net income |
(56 |
) |
|
15 |
|
|
(41 |
) |
Net gains (losses) on derivatives1
|
$ |
28 |
|
|
$ |
(6 |
) |
|
$ |
22 |
|
Available-for-sale debt securities: |
|
|
|
|
|
Unrealized gains (losses) arising during the period |
$ |
(139 |
) |
|
$ |
45 |
|
|
$ |
(94 |
) |
Reclassification adjustments recognized in net income |
2 |
|
|
1 |
|
|
3 |
|
Net change in unrealized gain (loss) on available-for-sale debt securities2
|
$ |
(137 |
) |
|
$ |
46 |
|
|
$ |
(91 |
) |
Pension and other benefit liabilities: |
|
|
|
|
|
Net pension and other benefit liabilities arising during the period |
$ |
278 |
|
|
$ |
(62 |
) |
|
$ |
216 |
|
Reclassification adjustments recognized in net income |
209 |
|
|
(53 |
) |
|
156 |
|
Net change in pension and other benefit liabilities3
|
$ |
487 |
|
|
$ |
(115 |
) |
|
$ |
372 |
|
|
Other comprehensive income (loss) attributable to shareowners of The Coca-Cola
Company
|
$ |
(1,127 |
) |
|
$ |
(229 |
) |
|
$ |
(1,356 |
) |
|
|
1 |
Refer to Note 6 for additional information related to the net gains or losses on derivative instruments designated and qualifying as cash flow hedging instruments.
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|
2 |
Includes reclassification adjustments related to divestitures of certain available-for-sale debt securities. Refer to Note 4 for additional information related to these divestitures.
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|
3 |
Refer to Note 13 for additional information related to the Company's pension and other postretirement benefit liabilities.
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|
Three Months Ended September 29, 2017 |
Before-Tax Amount |
|
|
Income Tax |
|
|
After-Tax Amount |
|
Foreign currency translation adjustments: |
|
|
|
|
|
Translation adjustments arising during the period |
$ |
162 |
|
|
$ |
(174 |
) |
|
$ |
(12 |
) |
Reclassification adjustments recognized in net income |
(17 |
) |
|
— |
|
|
(17 |
) |
Gains (losses) on intra-entity transactions that are of a long-term investment nature
|
1,063 |
|
|
— |
|
|
1,063 |
|
Gains (losses) on net investment hedges arising during the period1
|
(553 |
) |
|
211 |
|
|
(342 |
) |
Net foreign currency translation adjustments |
$ |
655 |
|
|
$ |
37 |
|
|
$ |
692 |
|
Derivatives: |
|
|
|
|
|
Gains (losses) arising during the period |
$ |
54 |
|
|
$ |
(19 |
) |
|
$ |
35 |
|
Reclassification adjustments recognized in net income |
(207 |
) |
|
76 |
|
|
(131 |
) |
Net gains (losses) on derivatives1
|
$ |
(153 |
) |
|
$ |
57 |
|
|
$ |
(96 |
) |
Available-for-sale securities: |
|
|
|
|
|
Unrealized gains (losses) arising during the period |
$ |
20 |
|
|
$ |
(17 |
) |
|
$ |
3 |
|
Reclassification adjustments recognized in net income |
(4 |
) |
|
2 |
|
|
(2 |
) |
Net change in unrealized gain (loss) on available-for-sale securities2
|
$ |
16 |
|
|
$ |
(15 |
) |
|
$ |
1 |
|
Pension and other benefit liabilities: |
|
|
|
|
|
Net pension and other benefit liabilities arising during the period |
$ |
(120 |
) |
|
$ |
49 |
|
|
$ |
(71 |
) |
Reclassification adjustments recognized in net income |
193 |
|
|
(73 |
) |
|
120 |
|
Net change in pension and other benefit liabilities3
|
$ |
73 |
|
|
$ |
(24 |
) |
|
$ |
49 |
|
Other comprehensive income (loss) attributable to shareowners of The Coca-Cola
Company |
$ |
591 |
|
|
$ |
55 |
|
|
$ |
646 |
|
|
|
1 |
Refer to Note 6 for additional information related to the net gains or losses on derivative instruments designated and qualifying as cash flow hedging instruments.
|
|
|
2 |
Includes reclassification adjustments related to divestitures of certain available-for-sale securities. Refer to Note 4 and Note 11 for additional information related to these divestitures.
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|
3 |
Refer to Note 13 for additional information related to the Company's pension and other postretirement benefit liabilities.
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|
|
|
Nine Months Ended September 29, 2017 |
Before-Tax Amount |
|
|
Income Tax |
|
|
After-Tax Amount |
|
Foreign currency translation adjustments: |
|
|
|
|
|
Translation adjustments arising during the period |
$ |
(793 |
) |
|
$ |
(142 |
) |
|
$ |
(935 |
) |
Reclassification adjustments recognized in net income |
103 |
|
|
(6 |
) |
|
97 |
|
Gains (losses) on intra-entity transactions that are of a long-term investment nature
|
3,270 |
|
|
— |
|
|
3,270 |
|
Gains (losses) on net investment hedges arising during the period1
|
(1,494 |
) |
|
571 |
|
|
(923 |
) |
Net foreign currency translation adjustments |
$ |
1,086 |
|
|
$ |
423 |
|
|
$ |
1,509 |
|
Derivatives: |
|
|
|
|
|
Gains (losses) arising during the period |
$ |
(159 |
) |
|
$ |
56 |
|
|
$ |
(103 |
) |
Reclassification adjustments recognized in net income |
(466 |
) |
|
175 |
|
|
(291 |
) |
Net gains (losses) on derivatives1
|
$ |
(625 |
) |
|
$ |
231 |
|
|
$ |
(394 |
) |
Available-for-sale securities: |
|
|
|
|
|
Unrealized gains (losses) arising during the period |
$ |
365 |
|
|
$ |
(123 |
) |
|
$ |
242 |
|
Reclassification adjustments recognized in net income |
(117 |
) |
|
40 |
|
|
(77 |
) |
Net change in unrealized gain (loss) on available-for-sale securities2
|
$ |
248 |
|
|
$ |
(83 |
) |
|
$ |
165 |
|
Pension and other benefit liabilities: |
|
|
|
|
|
Net pension and other benefit liabilities arising during the period |
$ |
(161 |
) |
|
$ |
73 |
|
|
$ |
(88 |
) |
Reclassification adjustments recognized in net income |
266 |
|
|
(96 |
) |
|
170 |
|
Net change in pension and other benefit liabilities3
|
$ |
105 |
|
|
$ |
(23 |
) |
|
$ |
82 |
|
Other comprehensive income (loss) attributable to shareowners of The Coca-Cola
Company |
$ |
814 |
|
|
$ |
548 |
|
|
$ |
1,362 |
|
|
|
1 |
Refer to Note 6 for additional information related to the net gains or losses on derivative instruments designated and qualifying as cash flow hedging instruments.
|
|
|
2 |
Includes reclassification adjustments related to divestitures of certain available-for-sale securities. Refer to Note 4 and Note 11 for additional information related to these divestitures.
|
|
|
3 |
Refer to Note 13 for additional information related to the Company's pension and other postretirement benefit liabilities.
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The following table presents the amounts and line items in our condensed consolidated statements of income where adjustments reclassified from AOCI into income were recorded (in millions):
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|
Amount Reclassified from
AOCI into Income
|
|
Description of AOCI Component |
Financial Statement Line Item |
Three Months Ended September 28, 2018 |
|
Nine Months Ended September 28, 2018 |
|
|
Foreign currency translation
adjustments:
|
|
|
|
|
|
|
Divestitures, deconsolidations and
other1,2
|
Other income (loss) — net |
$ |
170 |
|
|
$ |
268 |
|
|
|
Income from continuing operations before
income taxes
|
170 |
|
|
268 |
|
|
|
Consolidated net income |
$ |
170 |
|
|
$ |
268 |
|
|
Derivatives: |
|
|
|
|
|
Foreign currency contracts |
Net operating revenues |
$ |
(43 |
) |
|
$ |
(98 |
) |
|
Foreign currency contracts |
Cost of goods sold |
(4 |
) |
|
(5 |
) |
|
Foreign currency contracts |
Other income (loss) — net |
(25 |
) |
|
(7 |
) |
|
|
Divestitures, deconsolidations and
other
|
Other income (loss) — net |
3 |
|
|
3 |
|
|
|
Foreign currency and commodity
contracts
|
Income from discontinued operations |
— |
|
|
8 |
|
|
|
Foreign currency and interest rate
contracts
|
Interest expense |
11 |
|
|
43 |
|
|
|
Income from continuing operations before
income taxes
|
(58 |
) |
|
(56 |
) |
|
|
Income taxes from continuing operations |
16 |
|
|
15 |
|
|
|
Consolidated net income |
$ |
(42 |
) |
|
$ |
(41 |
) |
|
Available-for-sale debt securities: |
|
|
|
|
|
Sale of debt securities |
Other income (loss) — net |
$ |
(3 |
) |
|
$ |
2 |
|
|
|
Income from continuing operations before
income taxes
|
(3 |
) |
|
2 |
|
|
|
Income taxes from continuing operations |
2 |
|
|
1 |
|
|
|
Consolidated net income |
$ |
(1 |
) |
|
$ |
3 |
|
|
Pension and other benefit liabilities: |
|
|
|
|
|
Curtailment charges |
Other income (loss) — net |
$ |
5 |
|
|
$ |
5 |
|
|
Settlement charges |
Other income (loss) — net |
35 |
|
|
121 |
|
|
Recognized net actuarial loss |
Other income (loss) — net |
30 |
|
|
95 |
|
|
|
Recognized prior service cost
(credit)
|
Other income (loss) — net |
(5 |
) |
|
(8 |
) |
|
|
Divestitures, deconsolidations and
other2
|
Other income (loss) — net |
— |
|
|
(4 |
) |
|
|
Income from continuing operations before
income taxes
|
65 |
|
|
209 |
|
|
|
Income taxes from continuing operations |
(16 |
) |
|
(53 |
) |
|
|
Consolidated net income |
$ |
49 |
|
|
$ |
156 |
|
|
|
|
1 |
Primarily related to the reversal of the cumulative translation adjustments resulting from the substantial liquidation of the Company's former Russian juice operations and the deconsolidation of our Canadian bottling operations. |
|
|
2 |
Primarily related to the refranchising of our Latin American bottling operations. |
|