Significant Operating and Nonoperating Items |
3 Months Ended |
|---|---|
Mar. 27, 2020 | |
| Significant Operating and Nonoperating Items | |
| Significant Operating and Nonoperating Items |
SIGNIFICANT OPERATING AND NONOPERATING ITEMS Other Operating Charges
During the three months ended March 27, 2020, the Company recorded other operating charges of $202 million. These charges primarily consisted of an impairment charge of $152 million related to a trademark in North America, which was primarily driven by revised projections of future operating results due to reduced availability at retail customer outlets and a change in brand focus in the Company's portfolio. In addition, other operating charges included $39 million related to the Company's productivity and reinvestment program and $11 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with our acquisition of the remaining interest in fairlife. Refer to Note 2 for additional information on the acquisition of the remaining interest in fairlife. Refer to Note 12 for additional information on the Company's productivity and reinvestment program. Refer to Note 15 for additional information on the impairment charge. Refer to Note 16 for the impact these charges had on our operating segments and Corporate.
During the three months ended March 29, 2019, the Company recorded other operating charges of $127 million. These charges primarily consisted of $68 million related to the Company's productivity and reinvestment program. In addition, other operating charges included $46 million of transaction costs associated with the purchase of Costa, which we acquired in January 2019, and $11 million for costs incurred to refranchise certain of our North America bottling operations. Costs related to refranchising include, among other items, internal and external costs for individuals directly working on the refranchising efforts, severance, and costs associated with the implementation of information technology systems to facilitate consistent data standards and availability throughout our North America bottling system. Other operating charges also included $2 million related to tax litigation expense. Refer to Note 2 for additional information on the acquisition of Costa. Refer to Note 8 for additional
information related to the tax litigation. Refer to Note 12 for additional information on the Company's productivity and reinvestment program. Refer to Note 16 for the impact these charges had on our operating segments and Corporate.
Other Nonoperating Items
Equity Income (Loss) — Net
During the three months ended March 27, 2020 and March 29, 2019, the Company recorded net charges of $38 million and $42 million, respectively. These amounts represent the Company's proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees. Refer to Note 16 for the impact these items had on our operating segments and Corporate.
Other Income (Loss) — Net
During the three months ended March 27, 2020, the Company recognized a gain of $902 million in conjunction with our acquisition of the remaining interest in fairlife, which resulted from the remeasurement of our previously held equity interest in fairlife to fair value, and a gain of $18 million related to the sale of a portion of our ownership interest in one of our equity method investments. These gains were partially offset by a net loss of $392 million related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities, and a loss of $57 million related to economic hedging activities. Refer to Note 2 for additional information on the acquisition of the remaining interest in fairlife. Refer to Note 4 for additional information on equity and debt securities. Refer to Note 6 for additional information on our economic hedging activities. Refer to Note 16 for the impact these items had on our operating segments and Corporate.
During the three months ended March 29, 2019, the Company recognized an other-than-temporary impairment charge of $286 million related to Coca-Cola Bottlers Japan Holdings Inc. ("CCBJHI"), an equity method investee. The Company also recognized a $121 million loss in conjunction with our acquisition of the remaining interest in CHI and a $57 million other-than-temporary impairment charge related to one of our equity method investees in North America. These charges were partially offset by a net gain of $149 million related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities, a gain of $39 million related to the sale of a portion of our equity ownership interest in Andina and a gain of $34 million related to economic hedging activities. Refer to Note 2 for additional information on the acquisition of the remaining interest in CHI and the sale of a portion of our equity ownership interest in Andina. Refer to Note 4 for additional information on equity and debt securities. Refer to Note 6 for additional information on our economic hedging activities. Refer to Note 15 for additional information related to the impairment charges and the loss recognized in conjunction with our acquisition of the remaining interest in CHI. Refer to Note 16 for the impact these items had on our operating segments and Corporate.
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