| OTHER COMPREHENSIVE INCOME |
OTHER COMPREHENSIVE INCOME
AOCI attributable to shareowners of The Coca-Cola Company is separately presented in our 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 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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December 31, |
2018 |
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2017 |
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Foreign currency translation adjustments |
$ |
(11,045 |
) |
|
$ |
(8,957 |
) |
Accumulated derivative net gains (losses) |
(126 |
) |
|
(119 |
) |
Unrealized net gains (losses) on available-for-sale securities1
|
50 |
|
|
493 |
|
Adjustments to pension and other benefit liabilities |
(1,693 |
) |
|
(1,722 |
) |
Accumulated other comprehensive income (loss) |
$ |
(12,814 |
) |
|
$ |
(10,305 |
) |
1 The change in the balance from December 31, 2017 includes the $409 million reclassification to reinvested 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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Year Ended December 31, 2018 |
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Shareowners of
The Coca-Cola Company
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|
Noncontrolling
Interests
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Total |
|
Consolidated net income |
$ |
6,434 |
|
$ |
42 |
|
$ |
6,476 |
|
Other comprehensive income: |
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|
Net foreign currency translation adjustments |
(2,088 |
) |
53 |
|
(2,035 |
) |
Net gains (losses) on derivatives1
|
(7 |
) |
— |
|
(7 |
) |
|
Net change in unrealized gains (losses) on available-for-sale debt
securities2
|
(34 |
) |
— |
|
(34 |
) |
Net change in pension and other benefit liabilities3
|
29 |
|
— |
|
29 |
|
Total comprehensive income |
$ |
4,334 |
|
$ |
95 |
|
$ |
4,429 |
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1
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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
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Refer to Note 4 for additional information related to the net unrealized gains or losses on available-for-sale debt securities.
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3 |
Refer to Note 14 for additional information related to the Company's pension and other postretirement benefit liabilities.
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OCI attributable to shareowners of The Coca-Cola Company, including our proportionate share of equity method investees' OCI, for the years ended December 31, 2018, 2017 and 2016 is as follows (in millions):
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Before-Tax Amount |
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Income Tax |
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After-Tax Amount |
|
2018 |
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|
|
|
Foreign currency translation adjustments: |
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|
|
|
Translation adjustments arising during the year |
$ |
(1,728 |
) |
|
$ |
59 |
|
|
$ |
(1,669 |
) |
Reclassification adjustments recognized in net income |
398 |
|
|
— |
|
|
398 |
|
Gains (losses) on intra-entity transactions that are of a long-term investment nature |
(1,296 |
) |
|
— |
|
|
(1,296 |
) |
Gains (losses) on net investment hedges arising during the year1
|
639 |
|
|
(160 |
) |
|
479 |
|
Net foreign currency translation adjustments |
$ |
(1,987 |
) |
|
$ |
(101 |
) |
|
$ |
(2,088 |
) |
Derivatives: |
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|
|
|
Gains (losses) arising during the year |
59 |
|
|
(16 |
) |
|
43 |
|
Reclassification adjustments recognized in net income |
(68 |
) |
|
18 |
|
|
(50 |
) |
Net gains (losses) on derivatives1
|
$ |
(9 |
) |
|
$ |
2 |
|
|
$ |
(7 |
) |
Available-for-sale debt securities: |
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|
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|
Unrealized gains (losses) arising during the year |
(50 |
) |
|
11 |
|
|
(39 |
) |
Reclassification adjustments recognized in net income |
5 |
|
|
— |
|
|
5 |
|
Net change in unrealized gains (losses) on available-for-sale debt securities2
|
$ |
(45 |
) |
|
$ |
11 |
|
|
$ |
(34 |
) |
Pension and other benefit liabilities: |
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|
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|
Net pension and other benefit liabilities arising during the year |
(299 |
) |
|
75 |
|
|
(224 |
) |
Reclassification adjustments recognized in net income |
341 |
|
|
(88 |
) |
|
253 |
|
Net change in pension and other benefit liabilities3
|
$ |
42 |
|
|
$ |
(13 |
) |
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$ |
29 |
|
|
Other comprehensive income (loss) attributable to shareowners of The Coca-Cola
Company
|
$ |
(1,999 |
) |
|
$ |
(101 |
) |
|
$ |
(2,100 |
) |
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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 |
Refer to Note 4 for additional information related to the net unrealized gains or losses on available-for-sale debt securities.
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3 |
Refer to Note 14 for additional information related to the Company's pension and other postretirement benefit liabilities.
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Before-Tax Amount |
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Income Tax |
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After-Tax Amount |
|
2017 |
|
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|
|
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Foreign currency translation adjustments: |
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Translation adjustments arising during the year |
$ |
(1,350 |
) |
|
$ |
(242 |
) |
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$ |
(1,592 |
) |
Reclassification adjustments recognized in net income |
23 |
|
|
(6 |
) |
|
17 |
|
Gains (losses) on intra-entity transactions that are of a long-term investment nature |
3,332 |
|
|
— |
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|
3,332 |
|
Gains (losses) on net investment hedges arising during the year1
|
(1,512 |
) |
|
578 |
|
|
(934 |
) |
Net foreign currency translation adjustments |
$ |
493 |
|
|
$ |
330 |
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$ |
823 |
|
Derivatives: |
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|
Gains (losses) arising during the year |
(184 |
) |
|
65 |
|
|
(119 |
) |
Reclassification adjustments recognized in net income |
(506 |
) |
|
192 |
|
|
(314 |
) |
Net gains (losses) on derivatives1
|
$ |
(690 |
) |
|
$ |
257 |
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|
$ |
(433 |
) |
Available-for-sale securities: |
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Unrealized gains (losses) arising during the year |
405 |
|
|
(136 |
) |
|
269 |
|
Reclassification adjustments recognized in net income |
(123 |
) |
|
42 |
|
|
(81 |
) |
Net change in unrealized gains (losses) on available-for-sale securities2
|
$ |
282 |
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|
$ |
(94 |
) |
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$ |
188 |
|
Pension and other benefit liabilities: |
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Net pension and other benefit liabilities arising during the year |
120 |
|
|
(7 |
) |
|
113 |
|
Reclassification adjustments recognized in net income |
325 |
|
|
(116 |
) |
|
209 |
|
Net change in pension and other benefit liabilities3
|
$ |
445 |
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|
$ |
(123 |
) |
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$ |
322 |
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Other comprehensive income (loss) attributable to shareowners of The Coca-Cola
Company
|
$ |
530 |
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$ |
370 |
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$ |
900 |
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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 |
Refer to Note 4 for additional information related to the net unrealized gains or losses on available-for-sale securities.
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3 |
Refer to Note 14 for additional information related to the Company's pension and other postretirement benefit liabilities.
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Before-Tax Amount |
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Income Tax |
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After-Tax Amount |
|
2016 |
|
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|
|
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Foreign currency translation adjustments: |
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Translation adjustments arising during the year |
$ |
(1,103 |
) |
|
$ |
51 |
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|
$ |
(1,052 |
) |
Reclassification adjustments recognized in net income |
368 |
|
|
(18 |
) |
|
350 |
|
Gains (losses) on net investment hedges arising during the year |
67 |
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|
(25 |
) |
|
42 |
|
Reclassification adjustments for net investment hedges recognized in net income |
77 |
|
|
(30 |
) |
|
47 |
|
Net foreign currency translation adjustments |
$ |
(591 |
) |
|
$ |
(22 |
) |
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$ |
(613 |
) |
Derivatives: |
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Gains (losses) arising during the year |
(43 |
) |
|
11 |
|
|
(32 |
) |
Reclassification adjustments recognized in net income |
(563 |
) |
|
213 |
|
|
(350 |
) |
Net gains (losses) on derivatives1
|
$ |
(606 |
) |
|
$ |
224 |
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$ |
(382 |
) |
Available-for-sale securities: |
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|
Unrealized gains (losses) arising during the year |
124 |
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|
(28 |
) |
|
96 |
|
Reclassification adjustments recognized in net income |
(105 |
) |
|
26 |
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|
(79 |
) |
Net change in unrealized gains (losses) on available-for-sale securities2
|
$ |
19 |
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|
$ |
(2 |
) |
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$ |
17 |
|
Pension and other benefit liabilities: |
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Net pension and other benefit liabilities arising during the year |
(374 |
) |
|
99 |
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|
(275 |
) |
Reclassification adjustments recognized in net income |
342 |
|
|
(120 |
) |
|
222 |
|
Net change in pension and other benefit liabilities3
|
$ |
(32 |
) |
|
$ |
(21 |
) |
|
$ |
(53 |
) |
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Other comprehensive income (loss) attributable to shareowners of The Coca-Cola
Company
|
$ |
(1,210 |
) |
|
$ |
179 |
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|
$ |
(1,031 |
) |
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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 |
Refer to Note 4 for additional information related to the net unrealized gains or losses on available-for-sale securities.
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3 |
Refer to Note 14 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 consolidated statement of income where adjustments reclassified from AOCI into income were recorded during the year ended December 31, 2018 (in millions):
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Description of AOCI Component |
Financial Statement Line Item |
Amount Reclassified from AOCI into Income |
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Foreign currency translation adjustments: |
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Divestitures, deconsolidations and other1,2
|
Other income (loss) — net |
$ |
398 |
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Income from continuing operations before income taxes |
$ |
398 |
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|
Income taxes from continuing operations |
— |
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|
Consolidated net income |
$ |
398 |
|
Derivatives: |
|
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Foreign currency contracts |
Net operating revenues |
$ |
(137 |
) |
Foreign currency contracts |
Cost of goods sold |
(8 |
) |
Foreign currency contracts |
Other income (loss) — net |
9 |
|
Divestitures, deconsolidations and other |
Other income (loss) — net |
3 |
|
Foreign currency and interest rate contracts |
Interest expense |
57 |
|
|
Income from continuing operations before income taxes |
$ |
(76 |
) |
|
Income taxes from continuing operations |
20 |
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|
Net income from continuing operations |
$ |
(56 |
) |
Foreign currency and commodity contracts |
Income from discontinued operations (net of income taxes) |
$ |
6 |
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|
Consolidated net income |
$ |
(50 |
) |
Available-for-sale securities: |
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Sale of securities |
Other income (loss) — net |
$ |
5 |
|
|
Income from continuing operations before income taxes |
$ |
5 |
|
|
Income taxes from continuing operations |
— |
|
|
Consolidated net income |
$ |
5 |
|
Pension and other benefit liabilities: |
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Settlement charges3
|
Other income (loss) — net |
$ |
240 |
|
Curtailment charges3
|
Other income (loss) — net |
1 |
|
Recognized net actuarial loss |
Other income (loss) — net |
131 |
|
Recognized prior service cost (credit) |
Other income (loss) — net |
(17 |
) |
Divestitures, deconsolidations and other2
|
Other income (loss) — net |
(14 |
) |
|
Income from continuing operations before income taxes |
$ |
341 |
|
|
Income taxes from continuing operations |
(88 |
) |
|
Consolidated net income |
$ |
253 |
|
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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. |
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2 |
Primarily related to our previously held equity method investment in the Philippine bottling operations and the refranchising of our Latin American bottling operations. |
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3 |
The settlement and curtailment charges were primarily related to productivity, restructuring and integration initiatives and the refranchising of our North America bottling operations. Refer to Note 14 and Note 19.
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