Third Quarter 2008
Results Presentation
October 31, 2008
Coca-Cola West Holdings(2579)

URL

Contact
TEL +81-92-283-5724
http://www.ccwh.co.jp/eng

Corporate Planning Group IR Team
FAX +81-92-283-5729
E-mail shigeki-okamoto@ccwh.co.jp

Contents
Ⅰ．3Q Results
Ⅱ．4Q Business plan
Ⅲ．CCW group reorganization plan1

Highlight【3Q(7-9) Results】
・Sales volume declined reflected unfavorable weather and short supply of products by CCNBC.
・August sales (vs. plan): -2,179,000C/S → 3Q sales (vs. plan): -2,157,000C/S

・Operating income was down 21.9% vs. plan, down 10.4% vs. last year on a comparable basis.

【4Q(10-12) Business plan】
・Sales volume target is changed from +4.8% to +0.3%.
・The company revises down the earnings forecast for 4Q and the fiscal year of 2008.
・Share buy back: 1.3 million shares (upper limit), 3,250 million yen (upper limit)【CCW group reorganization plan】
・Basic ideas： establish new structure that makes additional integration efficiency①reform and integration of marketing structure②reform of SCM structure③reform of cost structure④efficient of assets

・New SCM system： establish new system centered in CCW in order to attend to consumer needs
or upcoming changes in the beverage market2

Ⅰ. 3Q Results3

3Q results (7-9) － Sales volume(thousand cases)

3Q (7-9)Actualvs. plan *1change%55,894-2,157-3.7

vs. last yearchange
%
+480

+0.9

*1) The above plan is based on the performance forecast announced as of August 4, 2008.

＜Sales volume＞

(%)

20

vs.ly

August sales vs. plan: -2,179,000 C/S【Main factors】
・Short supply of products by CCNBC (-1,128,000 C/S)
vs.plan・Unfavorable weather (-722,000 C/S)

0

-20
July

Aug

Sep
4

3Q results (7-9) － August sales¾August sales: -2,179,000 C/S vs. plan (3Q sales: -2,157,000 C/S vs. plan)
Main factors: Short supply of products by CCNBC -1,128,000 C/S, weather -722,000 C/S
Daily sales vs. ly and average temperature (Kinki)sales

07 Ave. temperature

Vending channel sales
By package vs. plan

08 Ave. temperature+300

Volume per machine vs. ly (Kinki)

08/31

08/30

08/28
08/29

08/26
08/27

08/25

08/23
08/24

08/21
08/22

08/20

08/18
08/19

08/16
08/17

08/15

08/13
08/14

08/12

08/10
08/11

08/08
08/09

08/07

08/05
08/06

08/03
08/04

08/02

-300

08/01

+0

*exclude cup machines

20

（％）

35.0
30.0
25.0
20.0
15.0
10.0
5.0
0.0

Can

-243

Bottle can-84

500PET

-267

Other

-264

Chain store channel sales
By package vs. planCan
Small PET

0

(thousandcases)-10(thousandcases)-247

plan
actualLarge PET
Other

-69
-15

-20
July

AugustSeptember5

3Q results - Sales volume by brand
ReviewSales volume by brand(thousand cases)
3Q 2008 (7-9)
vs. planvs. last year

actualchange%change%Coca-Cola

6,197

-101

-1.6

+384

+6.6

Georgia

9,655

-929

-8.8

+39

+0.4

Soukenbicha

4,881

-591

-10.8

-507

-9.4

Aquarius

8,421

+12

+0.1

+146

+1.8

sub-total

29,154-1,609

-5.2

+61

+0.2

Priority

9,175

+184

+2.0

+908

+11.0

Other

17,564

-732

-4.0

-489

-2.7

55,894-2,157

-3.7

+480

+0.9

C
o
r
e

Total

■Coca-Cola
・Lost sales due to the short supply of
products by CCNBC
・Eighth consecutive quarter of growth■Georgia・Start on a recovery trend centered in coreflavors■Soukenbicha
・Decline due to the dull of seasonable flavors■Aquarius
・Lost sales due to the short supply of
products by CCNBC■Priority
・Fanta: up 5.4% vs. plan, up 25.4% vs. ly by
the continued success of FURU FURU shaker）*Priority brand ：Hajime/Ayataka, Fanta, Minute Maid,
Water(Minaqua, Morino-Mizudayori)6

3Q results - Sparking brands¾Growth mainly Coca-Cola TM and Fanta(+0.4% vs. plan, +9.5% vs. last year)＜Sparkling brands 3Q sales volume (2006～2008)＞

+

％
5
.
9

+934,000C/S(thousand cases)change+02006 3Q％
8.
92007 3Q

2008 3Q%

Coca-Cola TM

+384

+6.6

Fanta

+643

+25.4

Other

-93

-6.1

Sparkling total

+934

+9.5

7

3Q results -Georgia¾Start on a recovery trend centered in core flavors.
(Georgia sales volume: -8.8% vs. plan, +0.4% vs. last year)＜Sales volume by flavors＞
構成比（％）
European
Emerald Mountain Blend (Standard)〃(Café Au Lait)〃(Black)Other
Georgia total(thousand cases)

Sales
1,763
1,538
633
574
5,147
9,655

change
+32
+152
+633
+574
-1,352
+39

%
+1.8
+11.0
－
－
-20.8
+0.4

＜Georgia sales volume (vs. last year)＞
+0.6

(%)

+0.5
-0.2

+0.4

-3.7
-5
2007 3Q

4Q

2008 1Q

2Q

3Q

8

3Q results – Sales volume by Channel
ReviewSales volume by channel(thousand cases)

3Q 2008 (7-9)
actualvs. planchange■Vending
・VPM declined reflected unfavorable weather andshort supply of products by CCNBC＜Full service VPM vs. ly (%)＞ exclude cup machine
20

vs. last year%change%
CCWJ

Vending

16,547-1,321

-7.4

-188

-1.1

Chain store

14,816

+210

+1.4

+980

+7.1

CVS

5,467

-7

-0.1

+251

+4.8

Mikasa

0

Kinki

-20
July

Retail

7,252

-334

-4.4

-409

-5.3

Food service

5,356

-228

-4.1

+41

+0.8

Other

6,455

-479

-6.9

-195

-2.9

Aug

Sep

■Chain store
・Share down in August due to the productshortage, but recovered in September.
＜Market share vs. last year (%) ＞
4

Kinki

Total

55,894-2,157

-3.7

+480

+0.9

CCWJ

0

Mikasa
-4
July

Aug

Sep

9

3Q results - OTC Market Share (Exclude vending machine)
Source:Intage※The numbers outside thegraph are changes vs last year(%, Point)

100％

41.2%

42.6%

Other

44.3%

D

＋0.1

C

5.5%
5.8%

B

＋0.0

＋0.1

6.1%
6.2%

9.0%

＋0.3

-0.6

15.0%

＋0.2

21.8%

＋0.1

＋0.2

8.7%

＋0.3

-0.4

15.5%

-0.4

22.3%

＋0.0

＋0.2

8.0%

-0.2

A

14.5%

ＣＣＷＨ

21.9%

4Q

41.8%

6.1%
6.2%

5.3%
6.3%

2007 3Q

41.7%

2008 1Q

＋0.4

＋0.3

5.8%
6.5%

9.0%

＋0.4

8.4%

＋0.5

＋0.8

15.5%

＋0.7

15.1%

＋0.6

-0.2

21.5%

＋0.9

22.4%

＋0.5

2Q

＋0.6

3Q
10

3Q results - Consolidated P/L (7-9)(million yen)

2008
plan *1

vs. plan2007 *2

actualchange%actualvs. last yearchange2007%

actualvs. last yearchange%Sales volume

58,05155,894-2,157-3.7

55,413480

0.955,413480

0.9

Revenues

122,000

114,632-7,367-6.0

117,653-3,021-2.6

117,653-3,021-2.6

Gross profit

51,60047,517-4,082-7.9

49,541-2,024-4.1

49,541-2,024-4.1

Operatingincome

8,400

6,562

-1,837

-21.9

7,328

-765

-10.4

7,360

-798

-10.8

Recurringincome

8,900

6,804

-2,095

-23.5

7,725

-921

-11.9

7,758

-954

-12.3

Net income

4,500

3,022

-1,477

-32.8

4,583

-1,561

-34.1

4,602

-1,580-34.3*1)The above plan is based on performance projections announced as of August 4, 2008.
*2)The actual of 2007 is revised as below in order to compare with same accounting method. (We changed accounting method
in 2007)
Items
Review of the advanced payment depreciation method of Kinki : added 32 million yen as cost11

3Q results - Change factors vs. plan
plan

2008 3Q
actualchangeRevenues

122.0 114.6

-7.4

51.6

-4.1

Gross profit

47.5

OperatingincomeRecurringincomeNet income

8.4

6.5

-1.9

8.9

6.8

-2.1

4.5

3.0

-1.5

main factors for increase/decrease

Impact on products shortage by CCNBC
Decrease in sales volume
Decrease by sales mix
Increase in profit from toll fee
Other
Impact on products shortage by CCNBC
Decrease in sales volume
Decrease by sales mix
Increase in profit from toll fee
Other＜COGS＞
Decrease in sales commission
Decrease in advertising cost(used as a discount)
Decrease in service fee
Decrease in personnel cost
Other

Extraordinary losses
Income taxes(billion yen)change

-2.1
-2.0
-2.8
+ 0.3
-0.9
-0.9
-0.9
-2.1
+ 0.4
-0.6
+ 0.8
+ 0.7
（+0.3）
+ 0.3
+ 0.3
-0.1

-0.2
+ 0.8

12

3Q results - Sales volume/Revenues/Operating income
Sales volume
plan

actual(thousand cases, million yen)
Operating income

Revenueschangeplan

actualchangeplan

actualchangeJuly18,845

19,811

966

40,11540,920

804

2,312

2,494

182

August21,37419,194-2,17943,807

38,586-5,220

3,765

2,029

-1,735September

17,832

16,888-945

38,07835,126-2,952

2,323

2,039

-284

Total

58,05155,894-2,157122,000

114,632-7,368

8,400

6,562

-1,837

Sales volume(000 cases)

Revenues(million yen)

Operatingincome(million yen)

-1,128-2,098-474-722-1,343

-303

―

-900

-412

-1,850-4,341-1,189*Main factors for decrease in August
Main factors
Impact on products shortage by CCNBC
Impact on unfavorable weather
Change of sales mix
SubtotalComposite of products by channel (decrease of vending, increase of chain store)
Revenues： -346 million yen, OP： -200 million yen
Composite of products by package (decrease of small PET & can, increase of large PET)
Revenues： -554 million yen, OP： -212 million yen
13

3Q results - Operating income change factors vs. plan(billion yen)

Product
shortage-0.5＜Cost reduction＞
Sales promotion
Personnel cost
Repair cost
Other
Total

Sales volume
-0.2

8.4

0.5
0.3
0.1
0.2
1.1

Sales mix
-2.0
Cost
reduction+1.1
Discounts-0.3

3Q 2008 plan
Operating income

6.5

3Q 2008 actual
Operating income14

3Q results - Change factors vs. ly (after considering items)
2007
3Q

2008
3Q

changemain factors for increase/decrease

Revenues

Increase in sales volume
Increase in profit from toll fee(impact on increase in sugar/clude oil price)

Sale of consolidated company's stock

117.6

114.6

-3.0

Gross profit

Decrease by sales mix
Other
Increase in sales volume
Decrease by sales mix
Sale of consolidated company's stock

Decrease in profit from toll fee(impact on increase in sugar/clude oil price)

49.5

47.5

-2.0

OperatingincomeRecurringincomeNet income

Other＜COGS＞

6.5

-0.8

7.7

6.8

-0.9

4.5

3.0

-1.5

+0.9
+0.8
(-0.1)
-2.3
-2.1
-0.3
+0.4
-1.7
-0.5
-0.1
(-0.4)-0.2

Decrease in personnel cost
Decrease in advertising cost
Decrease in sales commission
Increase of fuel cost

+0.4
+0.4
+0.4
+0.1
-0.1

Extraordinary losses
Income taxes

-1.4
+0.8

Sale of consolidated company's stock

7.3(billion yen)change15

3Q results - Consolidated P/L (1-9)(million yen)2008

vs. planplan *1

actualSales volume144,792

142,635

Revenues

310,500

Gross profitchange2007 *2vs. last yearchange2007%

actualvs. last year%

actualchange%-2,157-1.5

141,950685

0.5

141,950685

0.5

303,202-7,297-2.4

310,520-7,317-2.4

310,520-7,317-2.4

131,000

126,916-4,083-3.1

132,325-5,409-4.1

132,325-5,409-4.1

Operatingincome11,6009,705-1,894-16.3

10,940-1,234-11.3

11,498-1,792-15.6

Recurringincome12,700

10,580-2,119-16.7

12,051-1,470-12.2

12,610-2,029-16.1

Net income

4,900

3,455

-1,444

-29.5

6,969

-3,513

-50.4

7,293

-3,837-52.6*1)The above plan is based on performance projections announced as of August 4, 2008.
*2)The actual of 2007 is revised as below in order to compare with same accounting method. (We changed accounting method
in 2007)
Items
Review of the advanced payment depreciation method of Kinki : added 558 million yen as cost16

Ⅱ. 4Q Business plan

17

4Q Sales volume plan
(thousand chases)

2008 4Q

2007
4Q

plan *1

actual
CCWH

44,28844,428vs. last yearchange

%

+141

+0.3

*1) The above plan is based on performance projections announced as of October 29, 2008.

Sales volume by channel
2007
4Q
actualplan

Sales plan by channel
2007
4Q
actual2008 4Q
vs. last yearchange%plan

2008 4Q
vs. last yearchange
%

3,773

3,806

+33

+0.9

Vending

14,251

14,428+176+1.2

11,632

11,727+95+0.8

Chain store

8,311

8,767

+456

+5.5

3,427

3,375

-52

-1.5

CVS

4,634

4,906

+271

+5.9

3,332

3,396

+65

+1.9

Retail

6,084

5,596

-487

-8.0

Priority

5,753

5,831

+78

+1.4

Food service

4,711

4,716

+5

+0.1

Other

6,296

6,015

-281

-4.5

Other

16,371

16,293-78-0.5

44,28844,428+141+0.3

44,28844,428+141+0.3

Coca-ColaCo GeorgiarSoukenbichaeAquarius

Total

Total

*Priority brand ：Hajime/Ayataka, Fanta, Minute Maid,
Water(Minaqua, Morino-Mizudayori)18

4Q Strategy - Point of initiatives

Strengthen Georgia during peak seasons

Strengthening
Strengthening sales
sales inin vending
vending channel
channel-- Increase
Increase thethe selection
selection (new(new ++ core
core products)
products)¾¾

Implementation
Implementation ofof thethe national
national promotion
promotion¾¾

Strengthening
Strengthening sales
sales inin OTCOTC channel
channel-- Increase
Increase coveragecoverage¾¾

19

Strengthen Georgia¾Increase the selection (new + core products)

New products (include renewal)

Core products¾Implementation of the national promotion

20

4Q Performance Projections(million yen)

2007
4Q
actual *1

plan *2

plan *3

2008 4Q
vs. planchange%vs. last yearchange%Revenues

99,001

101,800

97,900-3,900-3.8-1,201-1.2

Gross profit

42,88344,40041,100-3,300-7.4-1,783

-4.2

4,553

4,400

2,500

-1,900-43.2-2,053

-45.1

4,879

4,800

2,900

-1,900-39.6-1,979

-40.6

2,079

2,300

-2,300-4,600－-4,579－OperatingincomeRecurringincomeNet income*1) The actual of 2007 is revised as below in order to compare with same accounting method. (We changed accounting method
in 2007)
Items: Review of the advanced payment depreciation method of Kinki : added 6 million yen as cost*2) The plan is based on performance projections announced as of August 4, 2008.
*3) The plan is based on performance projections announced as of October 29, 2008.
21

4Q Operating income change factors - vs. last year
Sales volume(billion yen)

Impact on
CCNBC

+0.1

Increase of purchasing
price of products

-1.9

Sugar
・vehicular fuel
-0.2

4.5

2.5

4Q 2007 actual
Operating income

4Q 2008 plan
Operating income

22

2008 performance projections (1-12)(million yen)2007
actual*1plan *2

plan *3

2008
vs. planchange%vs. last yearchange%Revenues

409,521412,300

401,000-11,300-2.7-8,521-2.1

Gross profit

175,208

175,400

168,000-7,400-4.2-7,208-4.1

15,492

16,00012,200-3,800-23.8-3,292-21.3

16,92917,50013,500-4,000-22.9-3,429

-20.3

9,048

7,200

1,000

-6,200-86.1-8,048-88.9

OperatingincomeRecurringincomeNet income*1) The actual of 2007 is revised as below in order to compare with same accounting method. (We changed accounting method
in 2007)
Items: Review of the advanced payment depreciation method of Kinki : added 563 million yen as cost*2) The plan is based on performance projections announced as of August 4, 2008.
*3) The plan is based on performance projections announced as of October 29, 2008.
23

Revised factors of performance projections (1-12)

1．4Q risk factors
1)Decrease in sales volume (-2,000,000 C/S)
2)Cost reduction

Revenues

Profit-3.9 bn-1.5 bn+0.7 bn

2．Impact on CCNBC
1)increase of purchasing price of products
2)Liquidation of CCNBC (extraordinary losses)-1.1 bn-0.8 bn

3．Impact on decline in stock prices
1)Write-down of domestic investment securities as of 10/24 (extraordinary losses)-5.0 bn*Ref： Main extraordinary losses (10.4 billion yen)
1-9

10-12

1-12

• Integration cost
• Repair cost for sales equipment

0.6 bn1.1 bn0.4 bn0.7 bn1.0 bn
1.8 bn• Liquidation of CCNBC• Loss on disposals of fixed assets

0.6 bn0.8 bn-0.8 bn0.6 bn• Write-down of investment securities 0.4 bn• Sale of subsidiary company
0.5 bn5.0 bn-5.4 bn0.5 bn

Revenues-3.9 bn※株式評価損の税金費用について
・株式評価損は、回収の時期がスケジュール不能なものとして税金費用のマイナス（法人税等の減額）を計上できないが、過去の年金信託設定益（2001年）に対して繰延税金負債を計上しているため、それを取り崩すことで税金費用のマイナス（法人税等の減額）を計上している。

OP-1.9 bn
EBIT-7.7 bn
Net income-4.6 bn24

2008 Operating income change factors from initial plan
3Q actual vs. plan： -1.9

(billion yen)

4Q risk factors： -1.9

Products
Shortage
by CCNBC-0.5

Sales volume-0.2

Sales mix
-2.0

16.0

Discounts
-0.3

Cost
reduction Sales volume
+1.1
-1.5

Impact on
CCNBC
Raw materials
-１.１

Cost
reduction
+0.7

12.2

2008 initial plan
Operating income

2008 revised plan25
Operating income

Share buy back
Objectives：Improvement of capital efficiency to make flexibly capital policy
corresponding change of business environment possible
Acquisition shares ：1.3 million shares (upper limit) *Composition of shares 1.1%
Acquisition price ：3,250 million yen (upper limit)
Term：October 30 to December 31, 2008

＜Share buy back in 2008＞
Acquisition
shares (000)Acquisition price(million yen)

No.1 (Feb～Mar)

1,500

3,320

No.2 (Apr～Jun)

1,874

4,779

No.3 (Aug～Sep)

1,491

3,666

4,865
1,300
(upper limit)
6,165

11,766
3,250(upper limit)
15,016

Subtotal
No.4 (Oct～Dec) plan
Total (plan)* Number of company shares
End of September
End of December (plan)

Company shares Outstanding shares(thousand)(thousand)
9,846 (8.9%)
111,125
11,146 (10.0%)
26

Ⅲ.CCW group reorganization plan
1. CCW management structure from 2009
2. New SCM Structure from 200927

1. CCW management structure from 200928

Integration
2009

2008
Sales companies
Coca-Cola West Japan

Coca-Cola West

Functional companies
MIKASA CCBC

Functional Companies
Sales equipment

Integrate four
companies(CCWH, CCWJ,KINKI, MIKASA)

Coca-Cola West Equipment Service
Coca-Cola West Products
Coca-Cola DAISEN Products
Coca-Cola West Logistics

・・・

Coca-Cola West Holdings

KINKI CCBC

【Purpose of integration】

Logistics

1.Further strengthen ofmanagement base・・・

Production

2.Strengthen marketing andsales functions
3.Reduce indirect cost29

Management structure of CCW from 2009(as of Jan. 2009)*CO：Chief Officer

30Basic ideas for the fiscal year of 2009
Leading bottler in the world
Establish the structure that can create
integration effects as soon as possible
toward “Leading bottler in the world”

Grow significantly faster than our competitors
Establish a solid earnings base

Basic ideas for the fiscal year of 2009
■Reform and integrate
the marketing structureIncrease sales and market share by executing a
consumer-centric approach
Establish an efficient sales structure■Reform the SCM
structure

Closely coupled with sales activities andestablish supply structure that can respond
more quickly and flexibly to upcoming changes
Hold down procurement price and reduce cost

■Reform of cost
structureKeep cash free for our continuing growth
Carry out thorough cost control■Improve efficiency ofassetsEliminate ineffectual assets and utilize fixed
assets31

2. New SCM Structure from 200932

Current relationship between CCNBC and bottlers
What is CCNBC?
¾ Established as a joint investment between bottlers and TCCC in 2003.
¾ Centralized procurement, manufacturing and distribution operations

・Procurement： syrups and raw materials
・Manufacturing： relocation of facilities to bottlers or packers
・Distribution： inventory management and distribution until facilities¾ Bottlers purchase all finished products.

Suppliers

Logistics companies
Inventory management andDistribution until facilities

Supply-demand planning

Inventory
management

CCNBC

Optimization of
distribution

Purchase of syrups

Relocation of facilities

Coca-Cola Japan

Bottlers/packers (factories)•Sales of syrups•Production & Logistics

Purchase all finished products

Purchase of raw material

・Sales・Distribution fromfactories tobranches・Inventory
management

Customers & Consumers

Bottlers

33

New Supply Chain Structure from Jan. 2009
＜Changes＞¾ Manufacturing and logistics operations of CCNBC will be transferred to bottlers.
¾ Joint procurement will fundamentally continue leveraging scale advantage through a nationallyintegrated procurement organization for major packaging and raw materials.
On the other hand, operation related to the order will be transferred to bottlers.
⇒Realization of the supply chain structure by will of the company.

2003 to 2008
Distribution

Procurement

Product
development

Pricenegotiation

CCJC(Corporation with CCWH)

Production
Order

Factories Branch

Sales

CCNBC
(Joint investment)

Service

CCWH

From 2009
Product
development

CCJC(Corporate with CCW)

Distribution

Procurement
Price
negotiation

New
organization

Production
Order

Factories

BranchSales

ServiceCoca-Cola West34

Our concept〔Concept〕¾ Establish an independent SCM structure by ourselves in accordance with the new
SCM concept in the Coca-Cola system.
¾ Establish a SCM structure centered around Coca-Cola West.
〔Basic thought of new SCM in the Coca-Cola system〕
Structure that management in eachcompany can judge by themselves, and thatis integrated combination of risk and return
We have a policy of SCM done by eachbottler/multi bottlers, but we establish
cooperative alliance based on synergy〔What we need〕• A new SCM structure is closely
coupled with new commercialorganization established from nextyear
• Effective utilization of our facility andlogistics assets• Enlargement and strengthened
function of SCM

Establish an independent SCM structure by ourselves
Establish a SCM structure centered around CCW
35

Goal for new SCM structure¾ Strengthen market execution as well as enhancement the partnership between newmarketing structure and new SCM structure.

New Marketing Structure

New SCM Structure
・Strengthen SCM function

・Strengthen Trade-Marketing
function and execution inmarketLink-investment for new product-new SCM technology-high quality products

・Enhance quality of service-procurement, manufacturing, logistics

１．Enhancement the partnership between marketing and SCM functions.
・Participation in product & package development process of CCJC
・Speedier decision making of investment in SCM facilities
・Realize high-quality supply operation with faster supply of fresh, high -caliber products
２．Execute the operation more responsive and flexible in western Japan area.
・Realize a flexible production (inventory reduction)
・Realize a higher level of productivity and logistics cost reduction
36

New SCM structure in western Japan area
¾ Establish new SCM structure centered the company in western Japan area.

From
From JanJan 2009
2009
Optimal SCM
structure inwestern Japan37

［ Reference ］

38

Change in accounting method in 2007(1)¾¾Change
Changeofofsales
salesequipment
equipmentdepreciation
depreciationmethod(July,method(July,2007)
2007)≪Item≫≪Item≫◆The◆Thecompany
companychanged
changedthe
themethod
methodfrom
fromconstantconstantpercentage
percentagemethod
methodtotonew
newconstantconstant
dollardollarplan
planininorder
ordertotorationalize
rationalizethe
thecorrespondence
correspondencebetween
betweenrevenues
revenuesand
andcost.
cost.
–Adopt–Adoptnew
newconstantconstantdollar
dollarplan
plantotoall
allsalessalesequipments
equipmentsheld
heldatatthethebeginning
beginningofofthe
theperiod.
period.
–Depreciate–Depreciateininthree
threeyears
yearswithwithconstantconstantdollar
dollarplan
planininterms
termsofofsales
salesequipment
equipmentwhich
whichhas
hasalready
depreciated
to
95%
of
an
acquisition
price.
already depreciated to 95% of an acquisition price.

≪Impact≪Impacton
onthe
thechange≫change≫◆Assets◆Assetswhich
whichremaining
remainingdepreciable
depreciablelife
lifeisisshort(one-two
short(one-twoyears)atyears)atthe
thetime,time,increase
increase
depreciation
depreciationcost.
cost.
◆Assets◆Assetswhich
whichremaining
remainingdepreciable
depreciablelife
lifeisislong(four-fivelong(four-fiveyears)
years)decrease
decreasedepreciation
depreciation
cost.
cost.
¾¾Change
Changeofofadvanced
advancedpayment
paymentdepreciation
depreciationmethod(January,
method(January,2007)
2007)≪Item≫≪Item≫◆Kinki◆Kinkichanged
changedadvanced
advancedpayment
paymentdepreciation
depreciationmethod
methodfrom
fromoneonetimetimetototime
time
depreciation
method
in
order
to
unify
the
accounting
methodinthegroup.
depreciation method in order to unify the accounting method in the group.

≪Impact≪Impacton
onthe
thechange≫change≫◆Depreciation◆Depreciationcost
costatatthe
thefiscal
fiscalyear
yearofof2007
2007decreased
decreasedbecause
becausethe
theadvanced
advanced
payment
paymentcost
costwaswasdepreciateddepreciatedwith
withoneonetimetimemethod
methodinin2006.
2006.
39

Change in accounting method in 2007(2)＜Impact on changing accounting method which the company did in 2007＞(million yen)

1H
1Q

2H

2Q

subtotal

3Q

4Q

Total

subtotal

Sales equipment depreciation(constant percentage method
to new constand dollar plan)

711

-711

0

0

0

0

0

Advanced payment depreciation(one time to time depreciation)

333

192

525

32

6

38

563

Total

1,044

-519

525

32

6

38

563

40

Sales volume by package

3Q 2008 (7-9)
actualBottlevs. planchangevs. last year%change

%

596

+51

+9.4

+19

+3.4

～ 1,000ml

12,827-1,796-12.3-1,182-8.4

1,001ml ～

11,657

+708

+6.5

+858

+7.9

subtotal

24,484-1,088

-4.3

-323

-1.3

Can (including bottle can)17,412

-698

-3.9

+825

+5.0

Other

1,899

-84

-4.3

-41

-2.1

Syrup, powder, food

11,502

-339

-2.9

-0

-0.0

Total

55,894-2,157

-3.7

+480

+0.9

PET

41

3Q (7-9) By brand/By channel Volume/Revenues/GP
2008

2007

100％
Other
38％

39％

Brand

Soukenbicha
Aquarius

15％

6％
8％
12％

6％
9％

Hajime/Ayataka
Hajime/Ayataka

5％
9％

27％

27％

14％

4％
8％

30％

30％

5％
8％
14％

6％
7％
11％

31％

34％

15％
32％

35％
22％

Georgia22％

Coca-Cola

11％

12％

12％

12％

12％

12％

Sales volume

Revenues

Gross profit

Sales volume

Revenues

Gross profit

2007

100％

Channel

5％

Other

11％
8％

Food service

13％

10％

Retail

10％

CVS

25％

3％
14％

3％

4％
13％
7％
10％

17％

2008
10％
8％

5％

12％

11％

11％

3％
13％

4％
12％
7％
10％

18％

26％
63％

Chain store

2％

65％

50％

51％
32％

32％
Vending
Sales volume

Revenues

Gross profit

Sales volume

Revenues

Gross profit
42Performance Trend(million yen)

Net Revenue

OperatingincomeRecurringincomeNet income

98

99

00

01

02

03

04

05

06

07

08
plan

117,991

164,731207,827

226,111247,737

240,825

253,248245,874

327,821409,521401,000

12,533

15,16017,44916,634

16,704

19,63816,86011,83012,321

16,056

12,20012,51015,88918,516

16,021

17,00519,895

17,065

12,256

13,225

17,493

13,500

5,872

6,823

5,700

1,420

7,086

9,380

8,564

7,305

7,570

9,375

1,000

450,000
400,000
350,000
300,000

25,0001999/7/1:
Merged with
Sanyo CCBC

2001/4/5
Make Mikasa CCBC
subsidiary

2006/7/1
Integration with
Kinki CCBC

2007/4/3
Capital/Businessalliance with Minami
Kyushu CCBC

20,000Operating
Income15,000250,000
200,000

10,000Net Revenues

150,000
100,000

5,000

50,0000(Net Revenues:
million yen)

98

99

00

01

02

03

04

05

06

07

0 income:(Operating
million yen) 43

08

Financial Data
＜Operating Income/Operating Income Ratio＞
25,000

8.2

10 250,000

Operating income ratio

6.7

20,0008

Operating income

6
3.8

19,638

3.9

16,86010,00011,8305,000

12,321

03

04

05

06

83.2

Net Assets

83

82.1

200,000

80.6
250,463150,000

80.5

81254,025

173,608

4

100,000

2

50,000

77

0

0

75

07

（％）

165,454（MM JPY） 03＜ROA／ROE＞

167,036

79

04

05

06

07

（%）

＜EPS／PER＞
50

150

12

EPS

9.7
10

8.3

116.25

ROA
5.9
5.1

6
5.7

4

93.42

03

5.6
29.5

5.2

50

ROE
（％）

04

82.22

24.2

4.3
2

40

108.80

100

8

0

85

16,0560（MM JPY）

Equity Ratio

81.0

4.8

15,000＜Net Assets / Equity Ratio＞

05

3.6

3.7

06

07

33.5

PER

88.28

28.0

30
20

18.1
10
0
（JPY）

03

04

05

06

07

0
（times）

44

CCWG management system(Principal business)
CCWJ area group
Coca-cola West Japan）
Coca-Cola West Holdings （ Management of group companies

CCWJ Sales(Beverage sales)(Vending machine operation and freight operation, Coca-Cola products only)

NISHINIHON Beverage(Vending machine sales and operation including non-Coca-Cola products)(2)

KINKI area group
KINKI Coca-Cola Bottling (3)KANSAI Beverage Service
Nesco
Kadiac(Beverage sales)(Vending machine sales and operation including non-Coca-Cola products)(Vending machine operation in amusement industry)(Vending machine operation in the KANSAI International Airport)

MIKASA area group
MIKASA Coca-Cola Bottling (4)MIKASA Beverage Service(Beverage sales)(Vending machine sales and operation including non-Coca-Cola products)

Sales Equipment Service
CCW Equipment Service(Vending machine related business)

Production
CCW Products
CCW DAISEN Products(Beverage production)(Beverage(mineral water) production)

Distribution
CCW Logistics(Freight transport)

Other business
MINAMI KYUSHU Coca-Cola group45

Coca-Cola System in Japan
Investment(percentage of shares)（100％）

Coca-Cola
Tokyo Research& Development
Co., Ltd(CCTR&D) ④

The
Coca-Cola
Company(TCCC) ②（100％）

Coca-Cola(Japan)Co., Ltd③(CCJC)(as of Jan, 2008)

Coca-Cola
National Beverages (25.0％)
Co., Ltd(CCNBC)⑥

Coca-ColaIBS Co., Ltd(CCIBS)(15.0％)⑤
Coca-Cola West
Holdings Co., Ltd①(CCWH)(20.0％)
Minami Kyushu
Coca-Cola BottlingCo., Ltd⑦

Coca-Cola(22.1％)
CustomerMarketing Company(CCCMC)⑧

Coca-Cola Central
Japan Co., Ltd(21.7％)

Coca-Cola Bottling
8 Companies(CCBC)FV Corporation(FVC)(3.9％)⑨
Joint companies of
TCCC/CCJC and bottlers

Tokyo Coca-Cola
Bottling Co., Ltd

46

Coca-Cola Related Companies and Their Roles
1.

Coca-Cola West Holdings Co., Ltd. (CCWH)

In July, 2006, Coca-Cola West Japan Company, Limited andKinki Coca-Cola Bottling Company, Limited merged the
management of both companies by establishing a joint
holding company CCWH.
2.

The Coca-Cola Company (TCCC)

Established 1919 in Atlanta, Georgia. Carries the rights togrant a license to manufacture and sell Coca-Colaproducts to the bottlers. TCCC (or its subsidiary) makes
franchise agreements with the bottlers.
3.

Coca-Cola (Japan) Co., Ltd. (CCJC)

Established 1957 in Tokyo, as “Nihon Inryo Kogyo K.K.,” awholly-owned subsidiary of The Coca-Cola Company. The
company name was changed in 1958 to Coca-Cola(Japan) Company, Limited. CCJC is responsible formarketing planning as well as manufacturing and distributionof concentrate in Japan.
4. Coca-Cola Tokyo Research & Development Co., Ltd.
(CCTR&D)
Established in January 1993 as a wholly-owned subsidiaryof The Coca-Cola Company. Since January 1995, carries
out product development and technical support to respondto the needs of the Asian region.
5.

Coca-Cola bottlers (CCBCs)

There are 12 bottlers in Japan, which are responsible forselling Coca-Cola products in the respective territories.

6.

Coca-Cola National Beverages Co., Ltd. (CCNBC)

Jointly established in April 2003 by TCCC and CCBCs for the
purpose of creating an optimal nationwide supply chain. It
started operation in October 2003. CCNBC procures raw
materials, coordinates manufacturing and supply/demandplans on a nationwide basis, and supply products to thebottlers.
7.

Coca-Cola IBS Co., Ltd (CCIBS)

Established through joint investment by The Coca-Cola
Company and its bottling partners in Japan, and the company
began operations on January 1, 2007. It is charged with
providing business consulting services to the Coca-Colasystem in Japan, as well as developing and generally
maintaining the information systems to support such work.
8.

Coca-Cola Customer Marketing Company (CCCMC)

Established through joint investment by Coca-Cola (Japan)
Co., Ltd. and all of its bottling partners in Japan, and thecompany began operations on January 1, 2007. It is charged
with holding business negotiations with major retailer outlets,
such as nationwide convenience stores and supermarket
chains, as well as developing proposals for sales promotions
and storefront activities.
9.

FV Corporation (FVC)

Jointly established in May 2001 by CCBCs and CCJC. FVC
carries out sales negotiations with national chain vending
operators, and deals with non-KO products as well as KO
products.
47

Glossary (1)1. Channel (Business Unit)

2. Vending

Vending:

Regular vending machine:

Retail sale business to distribute products
through vending machines to consumers

A vending machine offered free of charge to acustomer who supervises its operation and uses it tosell products purchased from us.

Chain store:
Wholesale business for supermarket chains
Convenience Store:
Wholesale business for convenience store chains
Retail:Wholesale business for grocery stores, liquor
shops, and other over-the-counter outlets

Full service vending machine:
A vending machine installed and managed directly by us(product supply, collection of proceeds etc.).
Fees are paid to the location proprietors.
Out-market vending machine:
An outdoor machine whose users are relatively
unspecificIn-market vending machine:

Food Service:
Syrup sale business for fast food restaurants,
movie theaters, sports arenas, “family
restaurants,” and theme parks

An indoor machine whose users are relatively specific
VPM
Sales volume per vending machine

Distributor:
Middleman who work for Coca-Cola to handle our
products in remote areas and islands.

48

Glossary (2)3. Chain Store

4. OtherNational chain:

Sales mix

National chain supermarket that CCNSC are
responsible for negotiating

Composite of products by brand, channel,
package, etc. The difference between budget andactual sales or cost of sales might be affected bya change in product sales mix as well as achange in unit priceRegional chain:
Chain supermarket that owns its stores in the two
or more bottlers’ territories
Local chain:
Chain supermarket that owns its stores in the
single bottler’s territory
RGM:
RGM(Revenue Growth Management) involves
joining forces with customers to deliver stronger
earnings through sustained sales increases byoffering value to consumers

49

Forward-Looking Statement

The plans, performance forecasts, and strategies appearing
in this material are based on the judgment of the managementin view of data obtained as of the date this material was released.
Please note that these forecasts may differ materially from actual
performance due to risks and uncertain factors such as thoselisted below.
- Intensification of market price competition- Change in economic trends affecting business climate- Major fluctuations in capital markets- Uncertain factors other than those above

50