coca cola Reconciliation of Q1 2005 Non-GAAP Financial Measures
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The document discusses reconciling non-GAAP financial measures to GAAP measures for a company. It provides supplemental financial data for the company for the first quarter of 2005 and 2004, including items impacting comparability between periods. Management believes the non-GAAP measures provide additional meaningful comparisons by excluding items that do not represent the company's fundamental operations.
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coca cola Reconciliation of Q1 2005 Non-GAAP Financial Measures
- 1. The Company reports its financial results in accordance with generally accepted accounting principles (GAAP). However, management believes that certain non-GAAP performance measures and ratios used in managing the business may provide users of this financial information additional meaningful comparisons between current results and results in prior operating periods. Management believes that these non-GAAP measures can provide additional meaningful reflection of underlying trends of the business because they provide a comparison of historical information that excludes certain items that impact the overall comparability due to the fact that these items do not represent results from the fundamental operations of the Company. See the Table below for supplemental financial data and corresponding reconciliations to GAAP financial measures for the three months ended March 31, 2005 and March 31, 2004. 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 COCA-COLA COMPANY AND SUBSIDIARIES Reconciliation of GAAP to Non-GAAP Financial Measures First Quarter (UNAUDITED) (In Millions, except per share data and margins) Three Months Ended March 31, 2005 Three Months Ended March 31, 2004 Items Impacting Comparability % Change - After Items Impacting % Change - After After Considering Comparability Reported Reported Considering Reported Considering Items (GAAP) (GAAP) Items (GAAP) Items Accelerated (Non-GAAP) (Non-GAAP) (Non-GAAP) Issuances of Repatriation of Amortization of Stock by Equity Resolution of Foreign Stock-Based Investees Tax Matters Earnings Compensation Net Operating Revenues $5,266 $5,266 $5,078 $5,078 4 4 Cost of goods sold 1,809 1,809 1,753 1,753 3 3 Gross Profit 3,457 3,457 3,325 3,325 4 4 Selling, general and administrative expenses 2,098 ($50) 2,048 1,874 1,874 12 9 Operating Income 1,359 50 1,409 1,451 1,451 (6) (3) Interest income 60 60 35 35 71 71 Interest expense 68 68 44 44 55 55 Equity income 91 91 95 95 (4) (4) Other income (loss) - net (17) (17) (25) (25) Gain on issuances of stock by equity investees 23 ($23) - - - -- -- Income Before Income Taxes 1,448 (23) 50 1,475 1,512 1,512 (4) (2) Income taxes 446 (8) $56 ($152) 12 354 385 385 16 (8) Net Income $1,002 ($15) ($56) $152 $38 $ 1,121 $1,127 $1,127 (11) (1) Diluted Net Income Per Share $0.42 ($0.01) ($0.02) $0.06 $0.02 $0.47 $0.46 $0.46 (9) 2 Average Shares Outstanding - Diluted 2,410 2,410 2,410 2,410 2,410 2,410 2,444 2,444 (1) (1) Gross Margin 65.6% 65.6% 65.5% 65.5% Operating Margin 25.8% 26.8% 28.6% 28.6% Effective Tax Rate 30.8% 24.0% 25.5% 25.5% Note: Items to consider for comparability include primarily charges, gains, and accounting changes. Charges and accounting changes negatively impacting net income are reflected as increases to reported net income. Gains positively impacting net income are reflected as deductions to reported net income.
- 2. The Company reports its financial results in accordance with generally accepted accounting principles (GAAP). However, management believes that certain non-GAAP performance measures and ratios used in managing the business may provide users of this financial information additional meaningful comparisons between current results and results in prior operating periods. Management believes that these non-GAAP measures can provide additional meaningful reflection of underlying trends of the business because they provide a comparison of historical information that excludes certain items that impact the overall comparability due to the fact that these items do not represent results from the fundamental operations of the Company. See the Table below for supplemental financial data and corresponding reconciliations to GAAP financial measures for the three months ended March 31, 2005 and March 31, 2004. 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 COCA-COLA COMPANY AND SUBSIDIARIES Reconciliation of GAAP to Non-GAAP Financial Measures Operating Income, by Segment First Quarter (In Millions) % Change - Three Months Ended March 31, 2005 Three Months Ended March 31, 2004 % Change - After Reported Considering Items Impacting Items Impacting After After (GAAP) Items Comparability Comparability Reported Considering Reported Considering (Non-GAAP) (GAAP) Items (GAAP) Items Accelerated Amortization (Non-GAAP) (Non-GAAP) of Stock-Based Compensation OPERATING INCOME North America $313 $12 $325 $353 $353 -11% -8% Africa 88 3 91 82 82 7% 11% Asia 404 5 409 413 413 -2% -1% Europe, Eurasia and Middle East 526 4 530 564 564 -7% -6% Latin America 280 4 284 262 262 7% 8% Corporate (252) 22 (230) (223) (223) -13% -3% Consolidated $1,359 $50 $1,409 $1,451 $1,451 -6% -3% -more-