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Bringing joy to allof our consumers

Coca-Cola West is the largest bottler in Japanand one of the leading bottlers in the world.
Through our highly responsive organizational
structure that has taken root in the communities
where we operate in the western Japan region,
we are carrying out our mission of meeting
consumers’ diverse needs with refreshing
Coca-Cola products.

Contents

To Our Shareholders

02 To Our Shareholders

Special Feature:
Taking Up the Challenge ofTransformation

04 Mergers and Integration
06 Reorganization of Sales Operations
07 R
 eorganization of Supply Chain
Management

Overview of Sales Results

08 Japan’s Soft Drink Market
08 Coca-Cola West Sales Results
10 Coca-Cola West Brand Lineup
11 Spotlight on Selected Brands
12 Overview of Sales Structure

Corporate Social ­Responsibility Activities

14 A imed at Winning the Trust of All
Stakeholders
15 Initiatives to Ensure Product Quality
16 Harmony with Nature
17 Realizing a Recycling-Oriented Society
18 Water Resource Management
19 Together with Local Communities

Dividend Policy and­Shareholder Reward
Points System

20 D
 ividend Policy and Shareholder Reward
Points System (as of December 31, 2009)

Financial Information

21 C
 onsolidated Financial Data
22 Management’s Discussion and Analysis
24 Consolidated Balance Sheets
26 Consolidated Statements of Income
27 C
 onsolidated Statements of Changes inShareholders’ Equity
28 Consolidated Statements of Cash Flows

Other Information

29 Risk Information
30 Corporate Governance
33 Board of Directors
34 Stock Information
35 Corporate Data
36 Coca-Cola System in JapanFORWARD-LOOKING STATEMENTS
This annual review contains statements regarding the Company’s future plans, projected performance and outlook. These forward-looking statements are nothistorical facts, but represent management’s opinions and beliefs based on information available at the time of writing.
Readers are cautioned that any number of risks and factors beyond the Company’s control could cause actual results to differ materially from those projected bymanagement. These include, but are not limited to, economic trends, intensifying competition in the soft drink industry, market supply and demand, andchanges in taxation and other applicable laws and regulations.
Note:
In the event that it is necessary to revise items in this annual report, the online version of the report, in the “Investor Relations” section of the Company’s Web
site, will be revised accordingly.
Coca-Cola, GEORGIA, Aquarius, Sokenbicha and their Japanese-character counterparts are all trademarks of The Coca-Cola Company.

Annual Review 200901

To Our Shareholders

To Our Shareholders

Following my appointment as president of Coca-Cola
West Co., Ltd., on January 1, 2010, I would like to takethis opportunity to personally thank all shareholders andinvestors for their invaluable support and understanding.
The Company has through integration evolved over the
past decade into the largest Coca-Cola bottler in Japanand one of the top-ranked in the world. Through consolidation and reorganization of its subsidiary companies,
the Coca-Cola West Group has also refined its management structure and systems, and commenced 2010
under newly appointed management.
I am pleased to report on our operating results for fiscal
2009, the fiscal year ended December 31, 2009, and toprovide an overview of the Group’s management policies
and business strategies.

02

Fiscal 2009 Business Overview and Operating Results
Impacted by the global-scale financial and economic crisis triggered by the U.S. banking-sector meltdown in
2008, business conditions at the start of the fiscal year
under review were weak. Japan’s economy remained in a
prolonged slump despite signs of a partial recovery inexport and manufacturing activities on the back of aseries of government stimulus packages. This wasreflected in poor corporate-sector results, suffering under
the affects of deflation and a strong yen, deteriorationin employment and disposable income conditions, aswell as stagnant capital investment and personal­consumption.
In the Japanese soft drink industry, companies were confronted by an increasingly harsh operating environment
as market results declined year on year owing to anincreasingly cost-conscious mindset by consumers in
response to the weak economy, unfavorable weather
conditions throughout the summer season, and an ongoing downward trend in product prices.
Against this backdrop of challenging market conditions,and in order to establish an even more solid managementfoundation, Coca-Cola West Holdings Co., Ltd., mergedwith three sales subsidiary companies—Coca-Cola WestJapan Co., Ltd., Kinki Coca-Cola Bottling Co., Ltd., andMikasa Coca-Cola Bottling Co., Ltd.—to form Coca-Cola
West Co., Ltd. on January 1, 2009.
Turing to our initiatives in the fiscal year under review, we
worked to transform the Group’s previous sales strategy
based on sales areas to one based on sales channels. At
the same time, we extended marketing activities drawing
from research and analysis of consumer purchasing patterns. Through these means, the Coca-Cola West Group
promoted sales strategies based firmly on consumer
needs and distinguished by consistency and integrity. In
its vending machine business, the Company actively pursued advantages of scale through M&A and business alli-

Annual Review 2009

ances. In this manner, we worked diligently to increase
market share and earnings. In addition, we reorganized
three of the Group’s subsidiaries responsible for sales
and logistics to focus on individual functions, and commenced fiscal 2010 with the foundation of three newcompanies on January 1, 2010. This move was madewith the aim to bolster sales and marketing functions
while at the same time curtailing indirect costs.
The Company took control of production and logistics
operations for western Japan from January 2009, as
responsibilities for overseeing its integrated supply-chain
management (SCM) were transferred from Coca-Cola
National Beverage Company, a joint venture establishedby Coca-Cola (Japan) Co., Ltd. and all of its bottling partners in Japan. The Group also successfully reduced
costs through efforts to establish a new SCM system andframework and to ensure more precise and detailed­management with respect to sales and marketing­collaboration.
Complementing these measures in the face of the harsh
operating environment, we worked to boost operating
efficiency and reviewed personnel systems in an effort toenhance productivity. At the same time, we promoted theGroup-wide campaign slogan, “Running Coca-Cola Westat the lowest cost possible,” with a view to reducing indirect expenditures. Despite these endeavors, sharp fluctuations in business conditions exceeded all of the Company’s projections. As a result, in fiscal 2009 consolidated
net revenues decreased 6.5% year on year to ¥369,698
million. On the earnings front, operating income dropped
78.7% year on year to ¥2,242 million, while recurringincome fell 81.1% to ¥2,085 million. The Company
incurred a net loss of ¥7,594 million, a negative turnaround of ¥7,724 million, largely attributable to an impairment loss applicable to assets earmarked for sale anddisposal together with the payment of early retirement
bonuses.

2010 Coca-Cola West Group Management Policy

Coca-Cola West Group Corporate Mission

Achieve profit target through“three reforms”

Create future of beverage business

Build a solid Coca-Cola West Group

Fiscal 2010 Management Policies and Earning Projections
Looking ahead at the soft drink industry in fiscal 2010,
conditions are anticipated to remain harsh due to theslump in personal consumption and a continued decline
in product prices. Under these circumstances, the Groupwill implement management policies aimed at achieving
earnings targets while closely pursuing three fundamental reforms.
Firstly, the Company will reform its sales structure withthe aim to increase revenues and earnings. To this end,
we will endeavor to implement effective global-standard
marketing methods based on research and analysis ofconsumer purchasing behavior, while enforcing stringent
earnings management. At the same time, we will establish an effective and efficient organizational operating
structure and promote the realignment of sales and distribution bases.
Secondly, the Group will enhance its SCM system throughreforms in the western Japan region. In implementing acomprehensive SCM system from procurement throughsales to distribution, the Company will be better positioned to enhance efficiency and reduce costs. To
improve the Group’s competitive advantage, we will synchronize procurement, sales and logistics to accelerate
and enhance our capacity to respond to market trends
and consumer needs.
Turning to the third reform, we will change our approachwith regard to consumers and orientate business activities toward their needs, recognizing that these needs are
the basis of the Group’s corporate value.
We are confident that closely following these three fundamental reforms will lead to steady growth in revenues
and earnings as well as to strengthening the Coca-Cola
West Group overall, despite downward pressures
imposed by the difficult operating environment.

We• offer products and services welcomed by consumers• respect each employee’s motivation and personal life
• respond to shareholders’ expectations and trust by
sustainable growth• nurture the relationships with society and environment

Accounting for the aforementioned policies and factors,
our projections for fiscal 2010 include consolidated net
revenues of ¥369,300 million, a nominal decrease of
0.1% from the previous fiscal year. From a profit perspective, operating income is forecast to more than double to¥7,000 million, a year-on-year increase of 212.1%. Recurring income is anticipated to reach ¥6,600 million, an
improvement of 216.5%. After a net loss in fiscal 2009,
we are projecting net income in the fiscal year underreview of ¥3,600 million.

To Our Shareholders

1. Sales
2. Supply Chain Management
3. Action based on consumer

Dividends
In our Corporate Mission, we place the utmost emphasis
on “respond to shareholders’ expectations and trust by
sustainable growth.” Our basic stance is to continue providing stable dividends to our shareholders while ensuring an active return of profits.
Taking into consideration fiscal 2009 results, forecast
performance for fiscal 2010, the future operating environment and other factors, we have determined a fiscal 2009
year-end dividend of ¥21 per share. Including the interim
dividend paid, this results in a full fiscal year dividend of¥42 per share, which regretfully is ¥1 per share lower
than the previous fiscal year. Looking ahead to fiscal
2010 dividends, we project the interim dividend, fiscal
year-end dividend and annual dividend to amount to ¥20,
¥20 and ¥40 per share, respectively.
As we work toward attaining our established goals, we
humbly request the continued support and understanding of all shareholders and other investors.
March 2010

Tamio Yoshimatsu
President

Annual Review 200903

Special Feature:

Taking Up the Challenge of Transformation

Mergers and Integration

History of mergers and integration

Special Feature: Taking Up
the Challenge of Transformation

Aiming to become a world leading bottler, the Company has carried out mergers and worked at corporate
integration since 1999.
1960

Establishment of the Company under the name of Nichibei Inryo Co., Ltd., later renamed Kita Kyushu Coca-Cola Bottling Co., Ltd.

1999

Consolidation with Sanyo Coca-Cola Bottling Co., Ltd. and renamed Coca-Cola West Japan Co., Ltd.

2001

Mikasa Coca-Cola Bottling Co., Ltd. becomes a subsidiary

2006

Management integration with Kinki Coca-Cola Bottling Co., Ltd. to establish joint holding company Coca-Cola West Holdings
Co., Ltd.

2007

Capital business tie-up with Minami Kyushu Coca-Cola Bottling Co., Ltd. through 20% stock acquisition, making it an ­equity-method affiliate

2009

Coca-Cola West Co., Ltd. established through the merger of Coca-Cola West Holdings, Coca-Cola West Japan, Kinki
Coca-Cola Bottling, and Mikasa Coca-Cola Bottling

Up until 1999

Present

Kita Kyushu
Kita Kyushu
Coca-Cola
Coca-Cola
Bottling
Bottling
Co., Ltd.
Co., Ltd.

Coca-Cola
Coca-ColaWest Co.,WestLtd.
Co., Ltd.

SanyoSanyo
Coca-Cola
Coca-Cola
Bottling
Bottling
Co., Ltd.
Co., Ltd.

MinamiMinamiKyushuKyushuCoca-Cola
Coca-Cola
Bottling
Bottling
Co., Ltd.
Co., Ltd.
(an equity-method(an equity-method
affiliated)affiliated)

Kinki Coca-Cola
Kinki Coca-Cola
Bottling
Bottling
Co., Ltd.
Co., Ltd.
MikasaMikasaCoca-Cola
Coca-Cola
Bottling
Bottling
Co., Ltd.
Co., Ltd.
MinamiMinamiKyushuKyushuCoca-Cola
Coca-Cola
Bottling
Bottling
Co., Ltd.
Co., Ltd.

Japan’s sole Coca-Cola Strategic Leading Partner
With an operating area comprising 14 prefectures in western Japan, Coca-Cola West Co., Ltd. is the largest
bottler in Japan, and on a sales basis, the fifth largest publically traded bottling company in the world. Going
beyond the traditional scope of a bottler, Coca-Cola West engages in product development, test marketingand other activities in collaboration with The Coca-Cola Company and Coca-Cola (Japan) Co., Ltd., as thecountry’s sole Strategic Leading Partner. In this way, the Company is playing a leading role in transforming the
Coca-Cola System in Japan.
The Coca-Cola Company
Strategic
Leading Partner

Coca-Cola (Japan) Co., Ltd.

04

Annual Review 2009

Coca-Cola West Co., Ltd.

Realizing the benefits of mergers and integration
With an increasingly severe business environment surrounding the Group, the Company has been moving
forward with Group reorganization since the management integration of July 2006, working to build a stronger
management foundation, enhance sales and marketing operations, and reduce indirect costs.
At the beginning of fiscal 2009, the Company was newly established through the merger of the former holding
company and three of its subsidiaries responsible for sales operations. The reorganization of separate company functions was completed on January 2010, and established a new operational structure for the Group.

Sales function companies

Production and distribution companies

These companies provide high-quality services covering

Production companies produce Coca-Cola products under

vending machine operations and repairs, while conducting

strict quality controls to provide safe and high-quality goods

regular activities to attract more consumers and encourage

to consumers. Distribution companies deliver the goods

further purchases.

speedily and reliably to ensure that customers receive fresh

West Vending Co., Ltd.

and delicious Coca-Cola products.

Nishinihon Beverage Co., Ltd.

Coca-Cola West Logistics Co., Ltd.

Coca-Cola West Retail Service Co., Ltd.

Coca-Cola West Products Co., Ltd.

Nesco Co., Ltd.

Coca-Cola West Daisen Products Co., Ltd.

Special Feature: Taking Up
the Challenge of Transformation• Coca-Cola West Group

Kadiac Co., Ltd.
Wex Co., Ltd.
Coca-Cola West Equipment Service Co., Ltd.

Coca-Cola West
Co., Ltd.

Other Group companies
Coca-Cola West Service Co., Ltd.
	Leasing and sale of real estate, and insurance­intermediacy, administration and agency
Chugoku Piano Transport Co., Ltd.
Freight transport, warehousing and storage businessAkiyoshi Systems Co., Ltd.
Chain restaurant businessAnnual Review 200905

Special Feature: Taking Up the Challenge of Transformation

Reorganization of Sales

Reorganization of the sales structure and adoption of a new marketing approach
Aiming to develop a consistent and uniform sales strategy for point-of-sale purchases by consumers, thesales structure of the Group was reorganized from the previous area-based sales structure to one based on
independent sales channels, and a trade marketing* method based on consumer purchasing behavior was
adopted.
The Company is bringing Coca-Cola products to consumers through optimal sales methods—encompassing brands, types of containers, prices, and sales channels—that focus on the soft drink consumption patterns of consumers. As it raises the accuracy of this trade marketing method up to international standards,
the Company is aiming for growth in both sales and profits.

Up until 2008

Since 2009

Area-based sales structure

Adoption of trade marketing approachwith a sales structure based on independent sales channels

Consumers in
Kinki Coca-Cola
Bottling area

Consumers in
Mikasa Coca-Cola
Bottling area

Sales

Sales

Sales

Coca-Cola WestJapan Co., Ltd.

Kinki Coca-Cola
Bottling Co., Ltd.

Mikasa Coca-Cola
Bottling Co., Ltd.

Planning

Planning

Planning

Supermarkets andconvenience stores

Vending machines

Grocery stores,
liquor stores,
restaurants, etc.

Sales

Sales

Sales

Chain stores

Vending machines

Retail stores andfood service

Independent sales channels

Feedback of consumers
information

Planning

Trade Marketing Headquarters
Plans sales methods according tosoft drink consumption patterns

The Company
The Company
Formulation of brandstrategies for point of salepurchases

Coca-Cola (Japan) Co., Ltd.

Coca-Cola (Japan) Co., Ltd.

Increasing sales and profits
06

Annual Review 2009

Feedback of marketing
information

Marketing based on consumer purchasing behavior

Consumers in
Coca-Cola WestJapan area

Marketing based on consumer purchasing behavior

Consumers

Reorganization

Special Feature: Taking Up
the Challenge of Transformation* Trade marketing is a method for marketing brands at sales outlets. It draws on information relevant to consumers and sales outlet operators to formulate sales
outlet strategies for increasing product purchases by consumers and improving the value of purchases.

Reorganization of Supply Chain Management

In the beginning of fiscal 2009, Coca-Cola West was given greater responsibility for supply-chain management (SCM) in the western Japan region, a shift from the previous nationwide SCM framework centered on
Coca-Cola National Beverages Co., Ltd. Coca-Cola West is presently carrying out production
and distribution as well as some procurement, whereas in the previous framework, Coca-Cola National Beverages handled procurement and production and some distribution.
With an eye to creating an optimal SCM system in the
Coca-Cola West Co., Ltd.
western Japan region, in fiscal 2009 the Company
newly installed a production line at the Akashi Production Plant for small-sized PET bottles, for which
demand is expected to grow, and expanded warehouse space adjacent to the Daisen Production
Plant, in an effort to improve the efficiency of proShikoku Coca-Cola Bottling Co., Ltd.
duction and distribution. As of the end of fiscal
2009, Coca-Cola products in the region were
Minami Kyushu Coca-Cola Bottling Co., Ltd.
supplied by nine production plants, six of which
belonged to the Coca-Cola West Group.
Optimal SCM framework for
Looking forward, the Group aims to
the western Japan region
Okinawa Coca-Cola Bottling Co., Ltd.
provide quick, high-quality, communitybased services while further reducing
costs.
Reorganized SCM framework and expanded role of Coca-Cola WestOur role

Procurement
Price negotiations
and contracts

FY2003 –FY2008FY2009 andonwardOrders

Production

Logistics
Production plants and
Branches
distribution centers

Coca-Cola National Beverages Co., Ltd. (joint investment)
The Company

Special Feature: Taking Up
the Challenge of Transformation

New SCM framework

The Company

The Company

Coca-Cola Business Service Co., Ltd. (joint investment) he new production line at the Akashi ProductionTPlant he expanded warehouse adjacent to the DaisenT
Production Plant

Offering quick and high-quality services
and further reducing costs
Annual Review 200907

Overview of Sales Results
Japan’s Soft Drink Market

In 2009, production volume of soft drinks in Japan decreased year on year as a result of tightened spending byconsumers facing worsening economic conditions, as well as unseasonable weather during the summer season. By product category, production volume of carbonated beverages and mineral water increased, while coffee beverages, tea beverages, and sports and functional drinks declined.
Despite these year on year results, the market has been expanding over the long term, with production of new
beverage categories—particularly mineral water—rising 66% over the past 20 years since 1990, and 16% since
2000. This trend suggests that the overall market for cold beverages in Japan will continue to grow.
.
Production volume of soft drinks over the previous 20 years (1,000kl)

20,00017,961

15,00010,805

Overview of Sales Results

10,000

5,000

0

1990

Proportion by category in 200916%

Other beverages

9%12%Sports and functional drinks
Mineral water29%

Tea beverages

16%

Coffee beverages

18%

Carbonated beverages

2009

Source: 2009 Annual Statistical Report on Soft Drinks, published by the Japan Soft Drink Association

Coca-Cola West Sales Results

1. Sales volume
Sales volume decreased year on year due to the impact of continued sluggish consumer spending and falling product prices brought on
by deteriorating employment and earnings conditions, as well as unseasonal summer weather.

Sales by Quarter (Thousands of cases)
YoY change
Sales volume Breakdown
VolumeFirst quarter

21%(1,410)(3.6%)

Second quarter

46,78126%(455)(1.0%)

Third quarter

53,45430%(2,438)(4.4%)

Fourth quarter

41,46023%(2,395)(5.5%)

179,711100%(6,699)(3.6%)

Total

08

38,017

Percent

Annual Review 2009

Fourth quarter%

First quarter
%

23

21
Sales
volumeThird quarter%

30

Second quarter%26

2. Number and market share of vending machines
As of the end of fiscal 2009, Coca-Cola West had 252,061 vending machines in operation. This total was 879 less than the previous ­fiscal
year-end, owing to the Company’s strategy of giving priority to highly profitable vending machines and decommissioning machines withlow sales. Coca-Cola West’s market share of vending machines installed outdoors was 33.7% in fiscal 2009, continuing the Company’s
overwhelming lead over its competitors.

Number of vending machines
300,000

260,381

Share of vending machines installed outdoors (%)
40

258,444

253,353

252,940

252,061
30

36.3

36.3

36.0

35.1

33.7

18.3 Competitor A 18.1

18.2

18.0

18.5

9.1 Competitor B 9.1

9.0

9.2

9.3

6.4 Competitor C 6.5

6.8

8.5

8.9

2005

2007

2008

2009

Coca-Cola West200,000
20
100,000
10

0

2005

2006

2007

2008

0

2009

Note: Figures for 2009 are for Coca-Cola West Co., Ltd., while figures for2005 – 2008 are the combined total of its three predecessor
companies: Coca-Cola West Japan Co., Ltd., Kinki Coca-Cola
Bottling Co., Ltd., and Mikasa Coca-Cola Bottling Co., Ltd.

2006

Source: S urvey of Vending Machines (covering May to June 2009),
conducted by Intage Inc.

In 2009, Coca-Cola West’s market share for over-the-counter30

sales of cold beverage products was 22.5%, up 0.2 percentage
points year on year, as the Company continued to hold the top

20

share in the industry.
By sales outlet, Coca-Cola West’s share of this market was

10

23.2% for supermarkets, 19.4% for convenience stores, 25.9%
for general stores (such as grocery stores and liquor stores), and023.5% for drug stores—the No. 1 share in each of these ­categories.

(%)

Coca-Cola West
23.0
22.1

21.7

22.3

22.5

15.3 Competitor A 15.0

14.7

15.5

16.2

9.1 Competitor D 8.6

8.4

8.7

8.3

5.3 Competitor E 5.7

5.9

6.4

6.6

2005

2007

2008

2009

2006

Overview of Sales Results

3. Market share for over-the-counter sales

Source: Store Audit conducted by Intage Inc.

4. Market share for over-the-counter sales by product category
Coca-Cola West dominated the market share for over-the-counter sales of soft drink products in every product category with its brandsof Coca-Cola, Coca-Cola Zero, Fanta, Georgia, Sokenbicha, and Aquarius.

C arbonated beverages
share (%)
50

Canned coffee beverages share (%)

47.1

50

41.9

40

40

30

30

19.0

20

17.8

10
0

20.0

20

9.5

10

Coca-Cola West

Competitor B

Competitor A

0

Coca-Cola West

Competitor A

Blended tea beverages share (%)

Sports and functional drinks share (%)

75

50

68.8

60

40

45

30

30

20

44.0

23.3
16.1

18.0
15
0

4.3
Coca-Cola West

Competitor B

Source: MBI conducted by Intage Inc.

Competitor A

Competitor B

100

Coca-Cola West

Competitor F

Competitor A

Annual Review 200909

Coca-Cola West Brand Lineup

The Company concentrates investment in its “Big 6” brands, namely Coca-Cola, Coca-Cola Zero, Fanta,
Georgia, Sokenbicha, and Aquarius. In addition to these, I LOHAS and Ayataka were both positioned as priority brands beginning from 2010. Coca-Cola West is also promoting numerous other brands including Qoo,
Kocha-kaden, and Minute Maid.

Other brands

Plus
2

10

Coca-Cola Zero

Fanta

Georgia

Sokenbicha

Aquarius

I LOHAS

Ayataka

Priority brands

Overview of Sales ResultsBig
6

Coca-Cola

Annual Review 2009

Spotlight on Selected Brands

Coca-Cola and Coca-Cola Zero
Favored by consumers who prefer low-calorie drinks,

Sales volume of Coca-Cola and Coca-Cola Zero

Coca-Cola Zero has enjoyed steady sales growth since(Thousands of cases)

its release in June 2007. In fiscal 2009, sales volume

20,000jumped 34.1% year on year as the Company took every
opportunity to boost sales by releasing two-liter PET
bottles and conducting various promotions. Sales volume of Coca-Cola also increased year on year, and together with Coca-Cola Zero, the combined sales volume

15,00018,267

16,835

14,572Coca-Cola ZeroUp 34.1% over FY2008
Up 115.0% over FY2007%+8.5

10,000Coca-Cola
Up 0.5% over FY2008
Up 6.7% over FY2007

5,000

of both products rose 8.5% over the previous fiscal
0

year.

Coca-Cola

2008

2009

Overview of Sales Results

2007

Coca-Cola Zero

New product release—I LOHASIn May 2009, Coca-Cola West launched I LOHAS, a new
brand of mineral water that is both delicious and gentle
on the environment. Packaged in a 520-milliliter PET bot- oY increases in market share of mineral water productsYsold at convenience stores (Percentage points)
+25
+24.1

tle that weighs only 12 grams—40% lighter than previous
bottles made by the Company and the lightest in Japan*—I LOHAS has won over environmentally conscious con-

+22.2

+21.2

+20
+15.9
+15

+16.8

+20.7

+17.9

sumers and recorded considerable sales growth.
* Compared to PET bottles of up to 550 milliliters manufactured
in Japan, based on research by Coca-Cola (Japan) Co., Ltd.,in July 2009.

The empty bottle ismade more compact
with a light squeeze
and twist+10

Attains No. 1 market share
+5
+4.5

+0.9

+1.4

+1.2

+0.9

Jan.

Feb.

Mar.

Apr.

0

May

Jun.

Jul.

Aug.

Sep.

Oct.

Nov. Dec.

Launch of I LOHAS on
May 18, 2009

Sales of 100 million units
nationwide in August(97 days after release)
A few of the many awards presented to I LOHAS:

Sales of 200 million units
nationwide in December(183 days after release)• 2009 Reduce, Reuse and Recycle Promotion
Minister’s Prize from the Ministry of Agriculture,
Forestry and Fisheries• 2009 Container Packaging 3R Promotion Minister’sPrize from the Ministry of the Environment

Source: Store Audit by Intage Inc.

Annual Review 200911

Overview of Sales Structure

Coca-Cola West’s sales structure is organized according to specialized sales channels, and its sales representatives are all beverage experts able to provide consumers with value-added solutions.
Vending machines
For this sales channel, Coca-Cola West carries out business through the operationof vending machines, providing all related services including replenishing andmaintaining the machines. The Company supplies assorted products that are popular with customers, while actively introducing cashless vending machines that suitthe needs of today and energy-saving units that are easier on the environment.

Chain stores
The chain store sales channel is comprised of high-volume sales outlets including
supermarkets, convenience stores, and home centers. Since consumer needs arediverse, Coca-Cola West researches the reasons why consumers visit certain
stores and purchase particular items. From these findings, the Company selects
the most suitable assortment of products to match the character of each store andOverview of Sales Results

proposes plans for sales promotions.

Retail stores
Retail stores include over-the-counter shops such as liquor stores, grocery stores,
and roadside stores. Coca-Cola West offers proposals for optimum sales equipment especially suited for each store and provides advertising materials featuringseasonal or popular culture themes, to give full support to store operators so that
their facilities can satisfy consumers.

Food service
For this sales channel, Coca-Cola West supplies syrup and powdered products fordrink dispensers to fast food and family restaurants, movie theaters, and otherfood service facilities. Targeting diverse customer needs, the Company offers awide assortment of products beginning with Coca-Cola and Fanta soft drinks
along with coffee and soups.

Coca-Cola West Sales Channels
Sales volume by sales channel (Thousands of cases)

Sales volume breakdown by channel

2008*

2009

Vending machines

65,80860,324(8.3%)

Supermarkets**

45,24847,622

5.2%

Convenience stores

19,105

18,839

(1.4%)

Chain stores total

64,353

66,461

3.3%

Retail stores

14,915

13,464(9.7%)

Food service

18,636

17,890(4.0%)

22,69821,572(5.0%)

186,410

179,711(3.6%)

Other
Total

YoY change* Results for 2008 have been adjusted to reflect changes related to some products
in 2009.
** The supermarkets channel includes drugstores, discount stores, and home centers.

12

Annual Review 2009

100

80

60

12.2%

12.0%

10.0%

10.0%

8.0%

7.5%

10.2%

10.5%

24.3%

26.5%

35.3%

33.6%

40

20

0

2008

2009

Sales volume by brand(Thousands of cases)
2008*

2009

Coca-Cola

12,804

12,8630.5%

Coca-Cola Zero

4,031

5,404

34.1%

Fanta

9,257

9,055

(2.2%)

Georgia

42,20840,832(3.3%)

Sokenbicha

14,264

13,370(6.3%)

Aquarius

19,10018,022(5.6%)

Big 6 total

101,664

99,545(2.1%)

84,74680,166(5.4%)

186,410

179,711(3.6%)

Other brands
Total

100

YoY change
80

45.5%

44.6%

10.2%

10.0%

7.7%

7.4%

22.6%

22.7%

5.0%
2.2%
6.9%

5.0%
3.0%
7.2%

60

40

20

0

2008

2009

Overview of Sales Results* Results for 2008 have been adjusted to reflect changes related to some products
in 2009.

Sales volume by container type
(Thousands of cases)
2008*

2009

Glass bottles

2,071

2,024

(2.3%)

Small PET bottles (up to 1000 ml)

39,97539,014(2.4%)

Large PET bottles (over 1000 ml)

32,49433,703

3.7%

Total PET bottles

72,46972,7160.3%

Cans63,11658,783(6.9%)

Other containers

6,391

5,942

(7.0%)

Syrup, powder, and food products

42,36340,246(5.0%)

186,410

179,711(3.6%)Total

100

YoY change

60

280 ml PET
bottle470 ml PET
bottle1.0 l PET bottle

1.5 l PET bottle

25.7%

33.9%

32.7%

17.4%

18.8%

21.4%
1.1%

21.7%
1.1%

40

20

* Results for 2008 have been adjusted to reflect changes related to some products
in 2009.

190 ml glass
bottle26.2%80

2.0 l PET bottle

0

2008

190 g can2009

280 g can

350 g canSyrup and
powderAnnual Review 200913

Corporate Social Responsibility Activities
Aimed at Winning the Trust of All Stakeholders
The Coca-Cola West Group works steadfastly to continue meeting its
responsibilities as a corporate citizen, based on its management
philosophy of “Creating the future of the soft drink business.” The Group’s
main corporate social responsibility (CSR) activities undertaken throughits beverage business are described below.

Corporate Social
Responsibility Activities

Initiatives in business activities

Coca-Cola West provides vending machines designed to support local residents and communities, including“community contribution vending machines” and “disaster-response vending machines.” These machines
contribute to the development of local communities and the safety and security of local residents in their
daily lives.
Community contribution vending machines to support local communities
Under the concept of vending machines used as donation boxes, a portion of the sales from these vending machines is returned to thecommunities where they are operated to fund social contribution projects, events, and sporting activities. This allows customers to collaborate together with their communities. First introduced in the northern Kyushu region, this initiative has spread across Japan, and the Company is working toward expanding it further in the future.
Putting community contribution vending machines to use

Sales

Vending machine
operators

Portion of sales

Customers purchase from community
contribution vending machines

Donations to activity funds

Disaster-response vending machines to provide relief during emergencies
These vending machines can provide local residents with free beverages in the event that a major earthquake or disaster disrupts supply
lines. Controlled remotely from local government offices, disaster-response vending machines are fitted with digital displays that can provide real-time information on emergency evacuation sites and maps.
Putting disaster-response vending machines to use

Disaster occurs

14

Annual Review 2009

Local government officeFree beverages
provided

Disaster information
reports

Initiatives to Ensure Product Quality

Placing product quality as its highest priority, the Coca-Cola West Group carries out thoroughgoing quality
management in order to provide consumers with safe and dependable products that are always fresh.
Quality management initiatives
The Coca-Cola West Group has established a stringent quality assurance framework based on the global standard Coca-Cola Quality Management System, which was independently developed under the
Coca-Cola System. Furthermore, the Group’s production plants quickly acquired ISO 9001 certification,
the international standard for quality assurance, and have adopted the Hazard Analysis Critical Control
Point* (HACCP) management method. Through these and other means, the Group is ensuring quality sothat consumers can enjoy its products with peace of mind.
In addition, the Coca-Cola West Group Quality Assurance Regulations along with Quality Assurance Standards are observed in every aspect of operations right up to the time the product reaches the customer.
* This is a method designed to ensure the safety of food products. It was initially developed to produce the high degree ofsafety required for producing food for NASA astronauts. The method comprises the analysis of causal factors that canseriously harm human health, including biological, physiological, and chemical causes, to determine techniques forcontrolling these factors.

Production plants

Distribution (warehousemanagement andtransport)

Offices

Stores and vending
machines

Consumers“We create products thatbring joy to consumers.”“We deliver high-quality
beverages straight from theproduction plant.”“We select products to fit
every location and carefully follow the first in,
first out stocking method.”Toshikazu Watanabe
Tosu Plant,
Coca-Cola West Products Co., Ltd.

Noboru Yamashiro
Transportation Division,
Coca-Cola West Logistics Co., Ltd.

Chihiro Kiya
Retail Food Service,
Coca-Cola West Co., Ltd.

“On our production line, we constantly clean to maintain the sanitaryconditions of the nozzles in the area
where containers are filled. We aregoing ahead with initiatives for safe
production so that our consumers—
no matter how many—can enjoy the
drinks we make without any worries.”“For me, the first priority of transport is delivering products as they
were when they came from the production plant—with their high­quality intact. With that in mind, I
drive carefully to make sure that I
don’t damage goods from a sudden
start, turn, or stop.”“We suggest the most suitable­assortment of products at each place
where we deliver, and then regularly
review these assortments after they
are settled. Working together withstore and vending machine owners,
we restock products in order of firstin, first out, and make sure to checkbest-before dates so that consumers
don’t have to worry when they buy
our products.”

Annual Review 2009

Corporate Social
Responsibility Activities

ISO 9001 certification

15

Harmony with Nature

As a company that uses water, Coca-Cola West has a social responsibility to protect this vital and irreplaceable
natural resource. Accordingly, the Company is actively involved in the preservation of watershed protection forests, which function to regulate water supplied by rivers through their retention of rainfall and snowfall in soil.
Conservation activities at Sawayaka Shizen-no-Mori
Coca-Cola West has concluded forest management agreements for
six forested areas that surround its production plants, designatedas Sawayaka Shizen-no-Mori. Group employees and their families
along with members of local communities work together in forest
conservation activities such as pruning and thinning the trees.

Number of participants in conservation activities
600

559

500
400
300

363
245

200
100
0

2007

2008

2009

Locations of Sawayaka Shizen-no-Mori

Corporate Social
Responsibility Activities

Tottori Sawayaka Shizen-no-Mori
Houki-cho, Saihaku-gun, Tottori Prefecture
Area: 5 hectares

Shiga Sawayaka Shizen-no-Mori
Hiroshima Sawayaka Shizen-no-Mori
Hongo-cho, Mihara City, Hiroshima Prefecture
Area: 7 hectares

Kyoto Sawayaka Shizen-no-Mori
Ujitawara-cho, Tsuzuki-gun, Kyoto Prefecture
Area: 12 hectares

Tosu Sawayaka Shizen-no-Mori

Hyogo Sawayaka Shizen-no-Mori

Tateishi-machi, Tosu City, Saga Prefecture
Area: 17 hectares

Kibita-cho, Ono City, Hyogo Prefecture
Area: 10 hectares

Our role asa company
Masahiro Umezaki
Manager,
Public Relations andEnvironmental Group,
Coca-Cola West
Co., Ltd.

16

Aisho-cho, Echi-gun, Shiga Prefecture
Area: 11 hectares

Annual Review 2009

In recent times, the public has become very concerned about water resources,
as potable water becomes difficult to secure on a global scale due to climatechange brought about by global warming. Therefore, we feel an obligation to
go above and beyond our role as a beverage business, and protect the forestsand soil that cradle our water supply.
The Coca-Cola Group began employing the Corporate Forest System of theForestry Agency of Japan in April 2006, and initiated forest conservation­activities starting with Tosu City in Saga Prefecture. I hope to see positive­initiatives for forest conservation that build on the environmental know-how wehave gained and increase opportunities for employees, their family members,
and local residents to participate. Furthermore, in addition to preserving water
resources, we should also endeavor to protect biodiversity in our efforts to­contribute to the creation of a sustainable society.

Realizing a Recycling-Oriented Society

Coca-Cola West is active in recycling empty containers and works to achieve its zero emissions goal for waste
generated from its production processes.
Recycling of empty containers
Meeting its obligations as a soft drink maker, Coca-Cola Westcollects empty containers from vending machine disposal bins
and brings them to its offices and production plants for recycling,with the aim of making effective use of limited resources throughits business activities. In fiscal 2009, the Company recycled­approximately 28,000 tons of materials.
At the Company’s Kita Kyushu Eco Town, located in Kita Kyushu
City in the Kyushu region, an empty container recycling centerhas been in operation since November 2003. About 6,000 tons ofempty containers from the center were recycled in fiscal 2009,
after steel and aluminum cans, PET bottles, and glass bottles were separated at
the Group’s offices and production
plants. In recognition of these initiatives,
Coca-Cola West was given an award by
Kita Kyushu City in 2009 for its outstanding efforts in handling industrial waste.

Amount of recycled materials (tons)
Steel

29,43830,000

2,200
4,204

20,00010,0000

PET bottles

30,188
232

2,369
4,024

7,061

7,425

15,741

16,233

2007

2008

Glass

AluminumPaper

27,884

137

301

2,263
3,726
6,593

15,0022009

In April 2008, Coca-Cola West began operations of the Retired Vending Machine Recycling Center, a specialized facility for disposing
retired beverage vending machines collected around the Chugoku and Kita Kyushu regions. Constructed on the site of the Kita Kyushu
Eco Town in Kita Kyushu City, the Center disassembles the retired machines and retrieves their parts and materials, thereby effectively
reusing limited resources. The Company aims to recycle 16,000 machines every year as it works toward the realization of a recyclingoriented society.

 umber of retired vending machines and amount of recoveredN
chlorofluorocarbons (CFCs)

Total number of retired
machines
Number of the total recycled
at the Center
Total amount of CFCs
recovered (kg)Amount of the total recoveredat the Center (kg)

2007

2008

2009

30,91529,31319,021

—

8,033

9,868

6,426

6,197

4,686

—

2,238

2,711

Corporate Social
Responsibility Activities

Recycling of retired vending machines

Waste recycling at production plants
At all Coca-Cola West production plants, waste generated fromproduction processes is separated and recycled, and efforts aretaken to reduce the amount of waste that is finally sent to landfills. With a recycling rate of over 99% in fiscal 2009, the Group
once again achieved its zero
emissions goal, which it defines as recycling of morethan 99% of total waste.
The recycled waste was reused in a wide variety of applications.

Volume and recycling rate of waste from production plants
Volume of waste (tons)

Recycling rate (%)
100.00100,000
80,000

99.97

99.97

99.87

0

Volume generated

Recycling rate

Recycling usage

Coffee grounds /tea leaves

39,540t

100.00%Sludge4,426t99.38%

Metal

285t

99.74%

Recycled steel /Aluminum cans

Glass

297t

99.97%

Recycled glass

Plastic

832t

99.86%

Paper

944t

100.00%

Other

426t

92.87%

Recycled plastic /Fuel
Cardboard boxes /Recycled paper
Roadbed materials /Other uses

Total

46,750t99.87%

Organic fertilizer

99.40

40,00020,000Waste type

99.80
99.60

60,000Volume and recycling rate of waste from production plants

48,72350,43146,750

99.00

2007

2008

2009

Attainment of zero

99.20

Recycling rate:

99.87% emissions goal

Annual Review 200917

Water Resource Management

Water used at the Coca-Cola Group’s production plants is recycled wherever possible and discharged water issubject to stringent wastewater treatment controls.
Water usage and wastewater controls at production plants
The production plants of the Coca-Cola West Group use large
quantities of water for their production processes. Nevertheless,after water is used once, it is subject to purification treatment
and then used again as equipment cooling water or in other­applications. When wastewater is finally discharged in rivers or
sewage systems, the Group follows established in-house standards that are even stricter than laws and regulations. Thesestandards provide the basis for highly effective wastewater treatment that ensures safe water quality, resulting in less environmental impact.

Volume of water usage and wastewater (Liters)
Water usage


7,833

7,590

8,000

2,000
0

2007

Tosu

BOD

40.0

13.0

Kiyama

BOD

30.0

12.0

Daisen

COD
BOD

160.0
160.0

47.0
10.0

Corporate Social
Responsibility Activities

Hongo* Chemical oxygen demand (COD) and biochemical oxygen demand (BOD)** Regulated limits vary by region

Recovery

4.9
4.8
12.0
6.3
17.4
10.0

AkashiMaximum amountmeasured (mg/l)
Recycling

25.0
25.0
20.0
20.0
50.4
29.0

Coagulator andfilter facility

Address:
Telephone:

Saga Prefecture

Hongo Plant

Annual Review 2009

Kiyama Plant
Tosu Plant
Kyoto Plant

Hongo Plant
Hiroshima Prefecture

Address:
Telephone:

1-3-1 Shimokitagata, Mihara City,
Hiroshima Prefecture
81-848-86-3600

Reception times: Mon – Fri. 8:30 – 17:00

Closed tovisitors:

Sat. – Mon. and national holidays

Closed tovisitors:

Sat. – Mon. and national holidays

Length of tour:

About 60 minutes

Length of tour:

About 60 minutes

Up to 80

Number of tour
participants:

From 20 to 80

Address:
Telephone:

380-16 Oaza-nagano, Kiyamacho, Miyaki-gun, Saga Prefecture
81-942-92-5251

Kyoto Plant
Kyoto

Address:
Telephone:

128 Taishin-arami, Kumiyamacho, Kuse-gun, Kyoto
81-774-43-5522

Reception times: Mon. – Fri., 8:30 – 17:00

Reception times: 9:30 – 11:30, 12:30 – 17:00

Closed tovisitors:

Sat. – Mon. and national holidays

Closed tovisitors:

Mon. (excluding national holidays
falling on that day), and during New
Year holidays

Length of tour:

About 60 minutes

Length of tour:

About 90 minutes

Up to 80

Number of tour
participants:

Up to 50

Number of tour
participants:

18

To rivers or
sewage system

Reception times: Mon. – Fri., 8:30 – 17:00

Number of tour
participants:

Kiyama Plant

1670-2 Nihonmatsu, Todorokimachi, Tosu City, Saga Prefecture
81-942-82-5141

Raw water tank forcollecting hot
wastewater

Explanation of equipment
Raw water tank for collecting hot wastewater Water tank for collecting and storing heated water emitted
from pressurized high-temperature product sterilization
devices
Cooling tower equipment Uses a fan to cool the collected heated effluent to room temperature
Coagulation and filter facility Equipment that processes and treats the collected/cooled water to bring itto the same quality as drinking water
Fluidized carrier tank Water tank for aerobic processing, which works by causing a carrier attached tomicroorganisms to flow through the water
Coagulation sedimentation reservoir Equipment that causes a chemical reaction, in which clean water
separates from sludge through sedimentation.

The Coca-Cola West Group organizes production plant tours to create­opportunities for learning and enjoyment in the community, as well as for
direct exchanges between participants and employees. At the Kyoto Production Plant, for instance, tour participants are guided through the facility
and can have fun observing firsthand every process of production required
to create finished Coca-Cola products.

Tosu Plant

Cooling tower

Fluidized carrier
Coagulation
sedimentation reservoir
tankInformation on production plant tours

Saga Prefecture

Shipping

Washing

Wastewater
treatment

COD
BOD
COD
BOD
COD
BOD

Kyoto

2009

Manufacturing
process

Into softdrinksWater treatment

Regulated
limits** (mg/l)

2008

Water treatment flow at plants

Serving water

Regulated items*

5,854

4,000

 egulated limits for water discharged in rivers andRproduction plant results
Production
plant

6,177

5,840

6,000

Wastewater
7,499

Together with Local Communities

Ichimura Nature School in Kyushu

Sawayaka classical music concerts

Sawayaka family musicals

Coca-Cola West supports the Ichimura Nature
School in Kyushu. With the basic ideal of “learning
about living things from the earth,” the school promotes the healthy rearing and growth of children
through experiences with nature focused on farming activities, and communal living with other­students.

Coca-Cola West sponsors concerts to provide
opportunities for local residents to enjoy live performances of the finest classical music. In 2009,
concerts were held at three locations, featuring
masterful performances by the Wiener Ring
Ensemble and other groups.

Coca-Cola West sponsors musicals during thesummer holidays and invites children and theirparents. In 2009, the timeless classic, The Wizardof Oz, was staged at two locations, with gorgeoussets that transformed the stage into a world of fantasy.

Sawayaka Rugby Clinic

Donation of unicycles to elementary
schools

Donation of educational materials to
special-needs schools

Members of the Coca-Cola West Red Sparks rugby
club teach basic rugby skills to high school andcollege students. This activity fosters the health ofyoung people and promotes new friendships. In
2009, clinics were held in Saga and Fukuoka prefectures, with about 350 students participating.

Coca-Cola West donates unicycles to elementary
schools to promote good health for children. As
part of the curriculum guidelines set by the Ministry of Education, Culture, Sports, Science andTechnology, unicycles are used as an aid to develop
motor coordination. The Company donated 2,000
unicycles to 200 schools in 2009.

Coca-Cola West donates computers, peripherals
and other information technology equipment tospecial-needs schools to help their students gain
self-reliance. The Company donated equipment to
20 schools in 2009.

Tree planting activities

Biotope project for students

Local community cleanups

To promote the importance of nature and bringpeople closer to their environment, the Company
supports tree planting activities in which children
and members of the community plant oak tree
seedlings. These activities deepen their understanding of forest conservation and create opportunities for them to think about environmental
issues such as global warming. In 2009, 720
seedlings were planted at three locations.

To teach the wonder and importance of the naturalenvironment, Coca-Cola West supports this biotope
project for students. Coming from 63 elementary
schools in 14 prefectures, the students build small
ecological habitats, or biotopes, based on plansdesigned by themselves. The Company’s Web sitefeatures project activities and the biotope management manual used by the children.

Coca-Cola West actively participates in cleanup
activities in cooperation with local governments,
and carries out beautification projects to express
its gratitude to the community as a corporate partner. The Group carried out six cleanups at foursites in 2009, and with about 650 employees andtheir family members participating, it contributed
to raising environmental awareness.

Annual Review 2009

Corporate Social
Responsibility Activities

Coca-Cola West carries out CSR activities as a good corporate citizen together with local communities in the 14
prefectures where it conducts business. Some of these activities are detailed below.

19

Dividend Policy and Shareholder Reward Points System (as of December 31, 2009)
Dividend Policy
Coca-Cola West places the utmost priority on paying stable dividends to shareholders, and pays two dividends per year—an interim
dividend and year-end dividend—after giving full consideration to the Company’s operating performance and retained earnings.

Dividend per share (yen)
50

40

30

20

27.0

25.0
17.5

30.0

32.0

32.0

1999

2000

34.0

34.0

2001

2002

40.0

40.0

2004

2005

42.0

43.0

43.0

42.0

2006

2007

2008

2009

40.0

36.0

20.0

10

0

1994

1995

1996

1997

1998

2003

Dividend Policy and Shareholder
Reward Points System

Note: Forecast for fiscal 2010 is as of February 3, 2010.

Shareholder Reward Points system
Shareholders who possess 100 or more shares receive a number of Reward Points according to the number of shares they own. For sharesregistered as of June 30, Reward Points are awarded the following September, and for shares registered as of December 31, the Reward
Points are awarded in April of the following year. Shareholders can choose to exchange their Reward Points, with one point equal to ¥60, forassorted Coca-Cola products or to use them as donations to the Company’s social contribution activities by using the Reward Points Web siteor product catalog.

Awarding criteria
Effective date

Number ofshares owned

Options for Reward Points
Details

100 to499 shares

30 Coca-Cola
Reward Points

500 to999 shares

40 Coca-Cola
Reward Points

1,000 to4,999 shares

60 Coca-Cola
Reward Points

Above 5,000
shares120 Coca-Cola
Reward Points

100 to499 shares

30 Coca-Cola
Reward Points

500 to999 shares

40 Coca-Cola
Reward Points

1,000 to4,999 shares

60 Coca-Cola
Reward Points

Above 5,000
shares120 Coca-Cola
Reward Points

June 30

December 31

20

2010
(Forecast)

Annual Review 2009

Time of award

September ofthe same year

Coca-Cola products

April of thefollowing year
Bath towel with
Coca-Cola West logo

Donation to Ichimura
Nature School in Kyushu

Financial Information

2005

2006

2007

2008

2009

245,874

327,821409,521395,556

369,698

(2.9)

33.3

24.9

(3.4)

(6.5)

Operating income (Millions of yen)

11,83012,321

16,056

10,521

2,242

Operating income/Net revenues (%)

4.8

3.8

3.9

2.7

0.6

Recurring income (Millions of yen)

12,256

13,225

17,493

11,048

2,085

5.0

4.0

4.3

2.8

0.6

12,201

13,10814,254

2,402(10,446)

5.0

4.0

3.5

0.6

(2.8)

7,305

7,570

9,375

129

(7,594)

3.0

2.3

2.3

0.0

(2.1)

93.42

82.22

88.29

1.25

(75.96)Return on equity (ROE) (%)

4.3

3.6

3.7

0.1

(3.3)

Return on assets (ROA) (%)

5.9

5.1

5.6

3.7

0.7

Total assets (Millions of yen)

208,711

304,907

315,672

277,696326,818

Net assets (Millions of yen)

173,608

250,463

254,025

234,521

222,816

83.2

82.1

80.5

84.4

68.2

2,228.79

2,358.05

2,391.83

2,345.03

2,227.96

Price book-value ratio (PBR)* (times)

1.2

1.2

1.0

0.8

0.7

Price earnings ratio (PER)* (times)

29.5

33.5

28.0

1,549.5(21.6)Cash flows from operating activities (Millions of yen)

16,60721,80633,00016,18028,747

Cash flows from investing activities (Millions of yen)

(15,256)(14,956)(23,306)

2,153(23,447)

Net revenues (Millions of yen)
Growth in revenues (%)

Recurring income margin (%)
Income (loss) before income taxes, minority interests and otheradjustments (Millions of yen)
Operating income/Income before income taxes, minority interestsand other adjustments (%)
Net income (loss) (Millions of yen)
Return on sales (%)
Net income (loss) per share (yen)Equity ratio (%)*1
Net assets per share*2 (yen)34Cash flows from financing activities (Millions of yen)

(2,901)(9,244)

3,586(31,486)

43,297

Cash and cash equivalents at end of year (Millions of yen)

20,23822,28435,564

22,412

71,221

Payout ratio (consolidated) (%)

42.8

51.1

48.7

3,440.0−

Dividend per share (yen)

40.00

42.00

43.00

43.00

42.00

interim dividend amount in brackets (yen)[20.00][20.00][21.00][21.00][21.00]Interest coverage ratio (times)(operating cash flow / interest payments)

—

589.3

285.4

462.7

97.2

Depreciation and amortization (Millions of yen)

13,86019,571

22,533

21,741

21,900Capital expenditures (Millions of yen)

16,19922,02019,951

18,032

25,201

Capital expenditures used for vending machines (Millions of yen)
[Share of capital expenditures used for vending machines]

5,819
[36%]

12,187[55%]

10,012[50%]

10,359
[57%]

8,760
[35%]

Financial Information

Consolidated Financial Data

*1 Until fiscal 2005, Shareholders’ equity ratio=Shareholders’ equity ÷ Total assets; from fiscal 2006, Equity ratio = Total equity ÷ Total assets*2 Until fiscal 2005, Shareholders’ equity per share = Shareholders’ equity ÷ The number of shares outstanding at the end of the period; from fiscal 2006, Net
assets per share = Net assets ÷The number of shares outstanding at the end of the period*3 Until fiscal 2005, Price book-value ratio (PBR) = Market value at the end of the period ÷ Shareholders’ equity per share; from fiscal 2006, Price book-value ratio(PBR) = Market value at the end of the period ÷ Net assets per share*4 Price earnings ratio (PER) = Market value at the end of the period ÷ Net income per share

Annual Review 200921

Management’s Discussion and Analysis

Consolidated Operating Results

Operating Results by Segment

Net Revenues
In fiscal 2009, the year ended December 31, 2009, sales volume in
the Coca-Cola West sales region declined due to the impact ofvarious factors, including sluggish consumption and falling prices
brought on by deteriorating employment and income conditions,as well as unseasonable summer weather. In a reform of the supply
and demand management system, product purchasing has shiftedto in-house production. While this resulted in increased productsales to other Coca-Cola bottlers in the Western Japan region in
fiscal 2009, at the same time, it ended manufacturing and logistics
revenue formerly commissioned by Coca-Cola National BeverageCo., Ltd. This revenue totaled ¥27,822 million in the previous fiscal
year. Due to the impact of these and other factors, net revenues
totaled ¥369,698 million, a decrease of ¥25,857 million, or 6.5%,
compared to the previous fiscal year.

Manufacturing and Marketing of Beverages and Foods
In the fiscal year under review, Coca-Cola West worked continuously to carry out its brand strategy of strengthening core brands,
namely Coca-Cola, Coca-Cola Zero, Georgia, Sokenbicha, Aquarius, and Fanta. Sales of the Coca-Cola brand expanded considerably owing to the addition of Coca-Cola Zero to bolster the productlineup, and to the effectiveness of a promotional campaign with the
J.League. For the Georgia brand, new products were launched
including the re-released European Blend and the all-new Gohobi
Break, as the Company implemented aggressive measures toenhance the brand. Coca Cola West strove to broaden the market
share of the Aquarius brand with the re-launch of Vitamin Guardand the expansion of its yearly “loyalty promotion.” Sales of the
Fanta brand increased with the release of Zero Cider and othernew products.
In addition to these core brands, sales of I Lohas mineral water,which features a lightweight bottle designed to attract environmentally conscious consumers, were up significantly and market share
increased.
In the area of sales channel strategy, Coca-Cola West developed
finely tuned marketing activities for each of its sales channels. Forsupermarkets, aggressive promotions of large-sized PET bottles
contributed significantly to increased sales and market share. For
vending machines, the Company worked to expand sales permachine by actively introducing cashless and energy-saving vending machines, aggressively promoting Georgia products with larger
sized cans, and enhancing merchandising activities. For retailstores and food service, “Coke Town” projects were launched in
Osaka and Fukuoka to develop stores as consumer starting points,
with the aim of expanding the Company’s consumer base.
Coca-Cola West continued to hold senior management meetings
to conduct intensive deliberations for the purpose of ensuring thecontinuous growth of the Coca-Cola business, based on its strategic partnership with The Coca-Cola Company and Coca-Cola(Japan) Co., Ltd.
Despite the efforts above, revenues in this segment were down
6.1% compared to the previous fiscal year, totaling ¥367,126 million. ­Operating income dropped 48.2% year on year to ¥11,468­million.

Financial Information

Operating Income
Despite efforts to carry out sweeping cost cuts across the entire
Coca-Cola West Group, operating income fell ¥8,278 million, or
78.7%, year on year, to ¥2,242 million, primarily due to the impactof the decrease in net revenues.
Recurring Income
Compared to the previous fiscal year, recurring income dropped¥8,963 million, or 81.1%, to ¥2,085 million, owing to such factors
as the fall in operating income and non-operating income costs
incurred for the issue of debenture bonds.
Net Income
Net income decreased ¥7,724 million from the previous fiscal year,
resulting in a net loss of ¥7,594 million. This is attributable to several
factors, including the decrease in recurring income, and an impairment loss on fixed assets of ¥6,092 million, which was designatedfor future sales and logistics bases targeted by reorganization plans
and in line with merger and consolidation initiatives that are aimed
at further enhancing and improving the efficiency of business andsales operations. In addition, a total of ¥1,767 million in transfer
fees and early retirement bonuses was used to transfer Coca-Cola
West employees to Group companies and to implement a
Group-wide early retirement plan, with the objective of proactively­upgrading the personnel system and employment conditions.

Net Revenues

Operating Income(millions of yen)

500,000

20,000409,521400,000

395,556

369,698369,300

327,821

17,493

16,05615,00015,00012,321

13,225
11,048

10,521
10,00010,0007,000

200,000
5,000

100,000

6,600
5,000

2,242
2006

2007

2008

2009

2010
(Forecast)0

Note: Forecasts for fiscal 2010 are as of February 3, 2010.

22(millions of yen)

20,000300,000

0

Recurring Income(millions of yen)

Annual Review 2009

2006

2007

2008

2009

2,085
2010
(Forecast)

0

2006

2007

2008

2009

2010
(Forecast)Forecasts for Fiscal 2010
In fiscal 2010, net revenues are forecast to remain flat, dipping
slightly by 0.1% to ¥369,300 million; operating income is forecast
to reach ¥7,000 million, a jump of 212.1%; recurring income isexpected to rise to ¥6,600 million, up 216.5%; and net income is
projected to total ¥3,600 million.

Financial Position
As of the end of fiscal 2009, the equity ratio was 68.2%. During the
fiscal year under review, Coca-Cola West issued debenture bonds
amounting to ¥50,000 million. Despite this, the Company believes
that the soundness of its financial standing will continue. Major
items in the balance sheet and reasons for changes compared tothe previous fiscal year are discussed below.
AssetsTotal assets stood at ¥326,818 million as of the end of fiscal 2009,
an increase of ¥49,122 million, or 17.7%, compared to the end of
the previous fiscal year. This was mainly attributable to the issue ofdebenture bonds of ¥50,000 million, as well as the acceptance oflease assets, specifically product inventories and production equipment at manufacturing and logistics bases formerly managed by
Coca-Cola National Beverage Co., Ltd., whose business ceased
according to reforms of the supply and demand management­system.

Cash Flows
Results of cash flows for fiscal 2009 are presented below. In addition, Chugoku Piano Transport Co., Ltd., previously an unconsolidated subsidiary, was newly included in the scope of consolidationfrom the beginning of fiscal 2009, contributing its cash and cash
equivalents of ¥212 million in fiscal 2009.
Cash Flow from Operating Activities
Net cash provided by operating activities amounted to ¥28,747
million, a year-on-year increase of ¥12,566 million, or 77.7%. Main
items included an increase in inventories and an increase inaccounts payable resulting from the reform of the SCM system,
and a decrease in income taxes paid (including tax refunds).
Cash Flow from Investing Activities
Net cash used in investing activities was ¥23,447 million, a difference of ¥25,610 million compared to the ¥2,153 million provided in
the previous fiscal year. This result was impacted by proceeds fromsales of marketable and investment securities of ¥22,661 million
undertaken in fiscal 2008. In the fiscal year under review, largescale capital investment was expended for new production­equipment at the Akashi Plant and other items.
Cash Flow from Financing Activities
Net cash provided by financing activities totaled ¥43,297 million, adifference of ¥74,783 million compared to the ¥31,486 million usedin the previous fiscal year. The change was due to the repayment
of debt totaling ¥12,500 million in fiscal 2008, and in the fiscal year
under review, the issue of debenture bonds amounting to ¥50,000
million, which was undertaken to enable a flexible investment­strategy going forward.
Accounting for all of the above, cash and cash equivalents at theend of fiscal 2009 stood at ¥71,221 million, an increase of ¥48,809
million, or 217.8%, compared to the previous fiscal year-end.

Liabilities
As of the end of fiscal 2009, liabilities amounted to ¥104,002 million, up ¥60,827 million, or 140.9%, compared to the end of theprevious fiscal year. The main reasons for this were bonds payableof ¥50,000 million from the issue of debenture bonds, and in linewith the aforementioned acceptance of lease assets, an increase intrade notes and accounts payable from the expanded scale ofmanaged inventories, and an increase in lease obligations.

Financial Information

Other Businesses
This segment is comprised of a real estate business, insurance
agency, transport business (excluding beverage distribution),and restaurant business. Since the beginning of fiscal 2009, thetransport business has been operated by a newly consolidated
subsidiary, Chugoku Piano Transport Co., Ltd.
Revenues in this segment were ¥2,744 million, a decrease of
44.2% year on year. Operating income, however, rose 15.4% to¥482 million.

Net Assets
Net assets were ¥222,816 million as of the end of fiscal 2009,
down ¥11,704 million, or 5.0%, from the end of the previous fiscal
year. This was mainly attributable to payment of dividends and a
net loss in retained earnings.

Net Income (Loss)
9,375

10,000Total Assets(millions of yen)
350,000

7,570
300,000
5,000

3,600

326,818

315,672
277,696

300,000

250,000

250,000(millions of yen)

250,463

254,025

234,521

222,816200,000

200,0001290304,907

Net Assets(millions of yen)

150,000
150,000

2006

2007

2008

2009

50,00050,000(7,594)(10,000)

100,000

100,000(5,000)2010(Forecast)

0

2006

2007

2008

2009

0

2006

2007

2008

2009

Note: Forecasts for fiscal 2010 are as of February 3, 2010.

Annual Review 200923

Consolidated Balance Sheets (As of December 31, 2007, 2008 and 2009)(Millions of yen)(Thousands of
U.S. dollars)*

2007

2008

2009

2009

ASSETS
Current assets:		

Cash and deposits¥19,567¥18,592¥20,634$221,870

		

Trade notes and accounts receivable

23,064

21,527

21,630232,580		Marketable securities

19,407

4,559

51,335551,989		Inventories

11,721

12,638——		Merchandise and finished goods——

22,861

245,817		

Work in process

—

—

0

1

		

Raw materials and supplies

—

—

2,055

22,096

		

Deferred tax assets

2,143

2,664

3,288

35,354		

Other current assets

15,42022,20814,490155,806

		

Allowance for doubtful accounts

(103)

(116)

(131)

(1,408)91,22082,074

136,164

1,464,129

Total current assets

Financial Information

Fixed assets:
Property, plant and equipment:		

Buildings and structures

35,19233,271

34,907375,344		

Machinery, equipment and vehicles

20,181

17,55319,010204,408		

Sales equipment

27,28526,09923,905

257,043

		Land

56,70956,08253,006569,956

		Lease assets

—

—

4,605

49,516

		Construction in progress

672

1,097

385

4,139

		

Other property, plant and equipment

1,992

1,900

1,801

19,365

Total property, plant and equipment

142,033

136,005

137,622

1,479,806

Intangible assets
		Goodwill		

Other intangible assets

Total intangible assets

—

—

2,112

22,709

4,719

4,449

4,344

46,709

4,719

4,449

6,457

69,430Investments and other assets:		

Investment securities

55,79432,13627,658297,397

		

Deferred tax assets

3,596

3,465

728

7,827

		

Advanced payments for retirement expenses

12,732

13,307

11,606

124,795

		

Other assets

6,147

6,779

7,025

75,537

		Allowance for doubtful accounts

(572)

(522)

(445)

(4,784)

77,69855,166

46,573500,784

Total investments and other assets
Total fixed assets

224,452

195,622

190,653

2,050,032

Total assets¥315,672¥277,696¥326,818$3,514,172* U.S. dollar amounts are translated from yen, for convenience only, at the rate of ¥93.00=US$1.00 (figures less than one unit are rounded).

24

Annual Review 2009

2007

2008

(Millions of yen)(Thousands of
U.S. dollars)*

2009

2009

LIABILITIESCurrent liabilities:¥5,222¥3,765¥17,309$186,118

Lease obligations

—

—

2,645

28,440		

Short-term debt

10,500

—

—

—

		

Current portion of long-term debt

2,000

—

—

—

		

Accrued income taxes

3,270

2,769

783

8,419

		

Other accounts payable

13,638

13,977

13,925

149,731		

Notes payable related to equipment

87

88

−

−

		

Other current liabilities

7,380

5,164

6,440

69,24742,09925,767

41,105441,989——

50,000537,634		

Trade notes and accounts payable		Total current liabilities

		

Bonds payable		Lease obligations

—

—

2,050

22,043

7,446

1,536

16,516

		

Deferred tax liabilities

9,040

		

Allowance for employees’ retirement benefits

5,180

5,394

5,512

59,268				Liabilities for directors’ and corporate auditors’
retirement benefits

65

7

16

172

		

Negative goodwill

1,452

1,037

622

6,688

		

Other long-term liabilities

3,809

3,522

3,158

33,956

Total long-term liabilities

19,54817,40762,897676,311

Total liabilities

61,64743,174

104,002

1,118,301

Financial Information

Long-term liabilities:

NET ASSETS
Shareholders’ equity:		Common stock

15,231

15,231

15,231

163,774

		

Additional paid-in capital

109,074

109,073

109,072

1,172,817

		Retained earnings

140,432

136,067

124,174

1,335,204

		Treasury stock (at cost)(11,271)(25,756)(25,759)(276,978)253,467

234,616

222,718

2,394,817

488

(165)

23

247

4

—

—

—

Total valuation and translation adjustments

492

(165)

23

247

Minority interests

64

71

74

795

Total net assets

254,025

234,521

222,816

2,395,870

Total liabilities and net assets¥315,672¥277,696¥326,818$3,514,172

Total shareholders’ equity
Valuation and translation adjustments:		Net unrealized gains (loss) on other marketable securities

		

Gain on deferred hedges* U.S. dollar amounts are translated from yen, for convenience only, at the rate of ¥93.00=US$1.00 (figures less than one unit are rounded).

Annual Review 200925

Consolidated Statements of Income (from January 1 to December 31)(Thousands of
U.S. dollars)*

2007

2008

2009

2009

Net revenues¥409,521¥395,556¥369,698$3,975,247

Cost of goods sold234,313

231,624

206,240

2,217,634

Gross profit

175,208

163,931

163,457

1,757,602

Selling, general and administrative expenses

159,151

153,409161,214

1,733,483

Operating income

16,056

10,521

2,242

24,107

Non-operating income

2,433

1,531

1,074

11,548Interest income

427

207

97

1,043

Dividends

269

282

251

2,698
3,870

Amortization of negative goodwill

414

414

360

Equity in earnings of affiliates

602

—

—

—

Property rental income

149

122

—

—

569

504

364

3,913

Non-operating expenses

996

1,004

1,231

13,236
3,397

Other non-operating income

Financial Information(Millions of yen)Interest expenses

114

34

316

Equity in loss of affiliates

—

215

74

795

Loss on disposal of property, plant and equipment

586

408

298

3,204
2,795

Expense for issuance of bonds

—

—

260

Property rental costs

56

44

—

—

Other non-operating expenses

238

301

282

3,032

17,493

11,0482,085

22,419

671

732

197

2,118

Recurring income
Extraordinary income
Gain on sales of property, plant and equipment

277

241

—

—

Gain on sales of investment securities

57

262

12

129

Gain on sales of shares of subsidiaries

—

196

—

—

Gain on sales of shares of affiliates

—

1

—

—

Subsidy income

336

31

165

1,774

Gain on transfer of business

—

—

19

204

3,910

9,379

12,729136,870

Loss on sales of property, plant and equipment

—

237

—

—

Impairment loss

282

—

6,092

65,505Extraordinary losses

Loss from disaster

—

—

19

204

Loss on disposals of property, plant and equipment

—

703

740

7,956

Compensation for retirement of fixed assets

289

140

—

—

Loss on sales of investment securities

—

97

—

—

Loss on sales of shares of subsidiaries
Write-down of investment securities

—

335

—

—

2,252

4,509

51

548

Write-down of golf club memberships

57

—

21

225

1,385

904

9,720

Group restructuring expenses

279

Expense for earthquake precautions

555

—

—

—

Expense for provision for sales equipment installation

—

1,968

2,716

29,204

Head office relocation expenses

—

—

362

3,892

Early retirement bonuses

—

—

617

6,634

Employee transfer fees

—

—

1,150

12,365

Effect of applying lease accounting standards

—

—

52

559

193

—

—

—

14,254

2,402(10,446)(112,322)

Quality problem countermeasure losses
Income (loss) before income taxes,
minority interests and other adjustments
Income taxes
Income tax deferred

5,034

3,887

1,018

10,946(167)(1,627)(3,878)(41,698)

Minority interests

12

12

8

86

Net income (loss)¥9,375¥129¥(7,594)$(81,655)* U.S. dollar amounts are translated from yen, for convenience only, at the rate of ¥93.00=US$1.00 (figures less than one unit are rounded).

26

Annual Review 2009

Consolidated Statements of Changes in Shareholders’ Equity (from January 1 to December 31)(Millions of yen)
Valuation and translation
Shareholders’ equity
adjustments
Net unrealized Total valuation
Total
Retained
Treasury stock
gains (loss) on
and translation
Common stock Capital surplus
shareholders’
other marketableearnings(at cost)
adjustments
equitysecurities

Minority
interests

Total
net assets¥15,231¥109,073¥136,067¥(25,756)¥234,616¥(165)¥(165)¥71¥234,521

Distribution of dividends——(4,299)—(4,299)———(4,299)Net loss——(7,594)—(7,594)———(7,594)

Acquisition of treasury stock

—

—

—

(5)

(5)

—

—

—

(5)

Cancellation of treasury stock

—

(0)

—

3

2

—

—

—

2

Net changes in items other thanshareholders’ equity during
the fiscal year

—

—

—

—

—

188

188

3

192

Total changes during the fiscal year—(0)

(11,893)(2)(11,897)

188

188

3

(11,704)

Balance as of December 31, 2009¥15,231¥109,072¥124,174¥(25,759)¥222,718

¥23

¥23

¥74

¥222,816

Balance as of December 31, 2008
Changes during the consolidated
fiscal year

Valuation and translation
adjustments
Net unrealized Total valuation
Total
Treasury stock
gains (loss) on
and translation
shareholders’
other marketable(at cost)
adjustments
equitysecurities

Shareholders’ equity

Common stock Capital surplus

Balance as of December 31, 2008

Retainedearnings$163,774 $1,172,827 $1,463,086$(276,946) $2,522,752$(1,774)$(1,774)

Minority
interests

Total
net assets$763 $2,521,731

Changes during the consolidated
fiscal year
Distribution of dividends——(46,225)—(46,225)———(46,225)

Net loss——(81,655)—(81,655)———(81,655)

Acquisition of treasury stock

—

—

—

(53)

(53)

—

—

—

(53)

Cancellation of treasury stock

—

(10)

—

32

21

—

—

—

21

Net changes in items other thanshareholders’ equity during
the fiscal year

—

—

—

—

—

2,021

2,021

32

2,064

Total changes during the fiscal year

—

(10)

(127,881)(21)(127,924)

2,021

2,021

32

(125,849)$(276,978) $2,394,817

$247

$247

Balance as of December 31, 2009

$163,774 $1,172,817 $1,335,204

Financial Information(Thousands of U.S. dollars)*$795 $2,395,870* U.S. dollar amounts are translated from yen, for convenience only, at the rate of ¥93.00=US$1.00 (figures less than one unit are rounded).

Annual Review 200927

Financial Information

Consolidated Statements of Cash Flows (Years ended December 31, 2007, 2008 and 2009)

Cash flows from operating activities:
Income (loss) before income taxes, minority interests and other adjustments
Depreciation and amortization
Impairment gains
Amortization of negative goodwill
Increase (decrease) in liabilities for directors’ and corporate auditors’
retirement benefits
Increase in liabilities for retirement benefits
Decrease (increase) in advanced payments for retirement expenses
Interest and dividend income
Interest expense
Equity in earnings (losses) of affiliates
Loss (gain) on sales of marketable and investment securities
Loss on sales of shares of subsidiaries
Loss (gain) on sales of shares of affiliates
Write-down of marketable and investment securities
Loss (gain) on sales of fixed assets
Loss on disposals of fixed assets
Decrease (increase) in accounts receivable
Decrease (increase) in inventories
Decrease (increase) in other assets
Increase (decrease) in accounts payable
Increase (decrease) in other liabilities
Other, net
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Income tax refunds
Net cash provided by operating activities
Cash flows from investing activities:
Acquisition of marketable and investment securities
Proceeds from sales of marketable and investment securities
Acquisition of fixed assets
Proceeds from sales of fixed assets
Acquisition of shares of subsidiaries
Proceeds from recovery of investment
Expense for acquisition of subsidiary with change in scope of consolidation
Proceeds from sales of shares of subsidiaries with change in scope of
consolidation
Acquisition of shares of affiliates
Proceeds from sales of shares of affiliates
Long-term loans
Proceeds from collection of long-term loans
Increase in time deposits
Proceeds from refund of time deposits
Other, net
Net cash used in (provided by) investing activities
Cash flows from financing activities:
Increase (decrease) in short-term borrowings
Repayment of long-term debt
Proceeds from issuance of bonds
Expense for repayment of lease obligations
Payments for acquisition of treasury stock
Proceeds from sales of treasury stock
Dividends paid
Dividends paid to minority interests
Net cash used in (provided by) financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents, beginning of year
Increase in cash and cash equivalents due to change in scope of
consolidation
Cash and cash equivalents at end of year

(Millions of yen)(Thousands of
U.S. dollars)*

2007

2008

2009

2009

¥14,254
22,533282(414)¥2,402
21,741—(414)¥(10,446)
24,0696,092(360)$(112,322)
258,806
65,505(3,870)

(181)

(54)

9

96

410
(2,326)
(696)
114
(602)
(52)
—
—
2,252
(265)
564
(828)
56
1,196
1,407
(553)
145
37,297738(115)(4,920)—33,000

271
(575)
(489)
34
215
(175)
139
(1)
4,509
2
820
494
(1,543)(4,549)
(932)
390
286
22,572543(34)(6,900)—16,180

107
1,701
(348)
316
74
(12)
—
—
51
(4)
1,188
42
(12,159)
5,361
13,291(432)
216
28,759342(295)(3,287)3,228
28,747

1,150
18,290(3,741)
3,397
795
(129)
—
—
548
(43)
12,774451(130,741)
57,645
142,913(4,645)2,322
309,236
3,677(3,172)(35,344)
34,709309,107(53)
6,239(20,238)
1,947
—
—
—

(1,390)22,661(19,920)
1,435
(808)
—
—

(33)
1,895
(24,613)
579
—
2,042
(2,509)(354)
20,376(264,655)
6,225—
21,956(26,978)

—

872

—

—

(11,016)
—
(202)
17
(40)
38
2
(23,306)

—
2
(704)
12
(20)
40
(27)
2,153

—
—
(1,086)
372
(191)
97
—
(23,447)——(11,677)
4,000(2,053)
1,043—(252,118)

10,495(2,300)——(56)
16(4,566)(2)
3,586
13,28022,284(10,500)(2,000)——(14,510)24(4,494)(5)(31,486)(13,152)
35,564—(194)
50,000(2,200)(5)
2(4,299)(4)
43,297
48,596
22,412—(2,086)537,634(23,655)(53)
21(46,225)(43)
465,559
522,537
240,989

—

—

212

2,279

¥35,564¥22,412¥71,221$765,817* U.S. dollar amounts are translated from yen, for convenience only, at the rate of ¥93.00=US$1.00 (figures less than one unit are rounded).

28

Annual Review 2009

Other Information
Risk Information(1) B usiness agreements with The Coca-Cola Companyof the United States and Coca-Cola (Japan) Co., Ltd.
Coca-Cola West conducts business activities based on a bottler
agreement with The Coca-Cola Company and Coca-Cola (Japan)
Co., Ltd.

(4) Impact of economic conditions
1) Trends in personal consumption
Sales of soft drinks are closely linked to trends in personal consumption. Accordingly, a sudden decline in personal consumption
due to worsened economic conditions or price reductions of theCompany’s products resulting from prolonged deflation could
adversely affect the operating results of the Group.
2) Fluctuations in asset value
Fluctuations in the value of land, marketable securities, and otherassets owned by the Coca-Cola West Group, as well as in pension
assets held in its defined-benefit company pension fund, could
potentially impact its operating results and financial position. Marketable securities with a fair value, for example, are subject tochanges in fair market value in capital markets, since that is how
they are valued.

(2) Quality assurance(5) Public regulations
Beverages are the core product of the Coca-Cola West Group. The
Group makes every effort to raise employee awareness regarding
quality and implements programs aimed at preventing incidents
concerning quality in order to offer its consumers high-quality andreliable beverages.
Nevertheless, in the event of an incident related to product quality,
the Company’s brand image could be tarnished, irrespective ofwhether or not it was actually at fault. As such, an incident of thisnature could adversely affect the operating results of the Group.

The Group’s Manufacturing and Marketing of Beverages & Foods
segment is subject to a number of regulations in Japan, including
the Act Against Unjustifiable Premiums and Misleading Representations, and the Food Sanitation Law. The Group fully complies
with these and all other regulations in its commitment to providing
safe and reliable products.
Accordingly, tougher regulations, for example, might incur newcompliance costs, which could potentially affect the operating
results of the Coca-Cola West Group.

Other Information

Business results and other aspects of the Company’s operations
discussed in this annual review are subject to a variety of risks.
Those risks deemed most likely to have a significant impact on
potential investment decisions are presented below. The Coca-Cola
West Group is fully aware of the possibility of these risks and thus
works to avoid them or effectively deal with them should theyarise.
Statements herein regarding future events or assumptions reflect
the judgment of management as of March 26, 2010.

(3) The soft drink industry(6) Management of personal information
1) Impact of market fluctuations
Sales of soft drinks, the Group’s core products, are readily influenced by changes in consumers preference.
In a beverage market of this kind, the Group strives to continuously
offer appealing products and services. Nevertheless, failure to
amply forecast market changes could potentially affect its operating results.
2) Impact of weather-related factors
Weather conditions tend to have an effect on the sales of softdrinks. Cool summers or warm winters, for example, often have asignificant impact on consumers demand. Although the Groupmakes every effort to minimize the influence of weather-related factors on sales, it offers no guarantee that it can completely eliminate
the effect of such factors.

The Coca-Cola West Group holds large volumes of personal information. In handling this information, it works on a unified basis toformulate and adhere to related guidelines and implement ongoingtraining and educational activities.
However, an external leak of personal information could lead to a
deterioration of trust in the Coca-Cola West Group and potentially
impact its operating results.

(7) Impact of disasters
The Coca-Cola West Group has a system in place to minimize theeffects of power outages, as well as other problems that could
affect its business operations. Typhoons, earthquakes and othernatural disasters, however, could create conditions that overwhelm
this system. Conditions of this magnitude could potentially impact
the operating results and financial position of the Group.

Annual Review 200929

Corporate GovernanceCoca-Cola West’s fundamental stance on corporate governance is
to maximize “shareholders value” by improving management efficiency and transparency.

scribed by Article 454, Paragraph 5 of the Company Law. The
Board of Directors has been authorized to determine interim dividends so that profits can be returned to shareholders when considered appropriate.

(1) Corporate Governance System
1) Status of Related Internal Bodies

Other Informationa. C orporate Auditor System
Coca-Cola West adopted corporate auditor system in accordance withits decision to separate decision-making and management oversight from business execution through a restructuring of the Boardof Directors and the adoption of the corporate executive officer
system in March 1999. In April 2007, the corporate executive officer system was extended across the Group in the interest ofincreasing the efficiency of Group management and speeding up
decisionmaking.
Furthermore, in March 2006, in order to clarify the roles and responsibilities of directors in each fiscal year and to establish a management structure capable of rapid responses to changes in businessconditions, the Group shortened the term of office of directors fromtwo years to one year.
b. Number of Directors
The Company’s articles of incorporation stipulate that there shallbe a maximum of 15 directors.
c. Requirements for Electing Directors
The Company’s articles of incorporation stipulate that election of
directors shall be by a majority of votes, where shareholders holding at least one-third of the voting rights of shareholders that can
exercise voting rights are in attendance. Resolution for election of
directors shall not be made by cumulative voting.
d. Outside Directors and Corporate Auditors
At present, two of Coca-Cola West’s ten directors and three of its
five corporate auditors are from outside the Group.
The Company has concluded with one outside director and threeoutside corporate auditors agreements limiting liability in case ofneglect of duty, based on the provisions of Article 427, Paragraph
1 of the Company Law. Under these agreements, liability is limited
to the minimum amount permissible under the law.
e. Acquisition of Treasury Stocks
The Company’s articles of incorporation stipulate that the Company may, by a resolution of the Board of Directors and without
seeking shareholder approval, repurchase its own shares on themarket, pursuant to the provisions of Article 165, Paragraph 2 of theCompany Law. The Board of Directors has been authorized to repurchase Company shares with the aim of allowing them to execute a
flexible capital structure policy according to changes in the businessenvironment and in the interest of raising capital efficiency.
f. Determination of Interim Dividends
The Company’s articles of incorporation stipulate that the Company may, by a resolution of the Board of Directors and without
seeking shareholder approval, determine interim dividends, as pre-30

Annual Review 2009

g. Special Resolutions of the General Meeting of Shareholders
The Company’s articles of incorporation stipulate that special resolutions of a general meeting of shareholders, provided for in Article
309, Paragraph 2 of the Company Law, shall be adopted by anaffirmative vote of at least two-thirds of votes, where shareholders
holding not less than one-third of the voting rights of shareholders
that can exercise voting rights are in attendance.
This is to ensure the smooth running of general meetings of shareholders by enabling a quorum to pass special resolutions.
h. Overview of Committees
In July 2006, the Company established the Management Advisory
Committee as an internal body of the Board of Directors. This committee solicits the advice of experts with the goals of improving theefficiency and transparency of management and increasing shareholder value. The committee is responsible for advising on mattersconcerning important strategies for the general management of theGroup, as well as candidacy for director and corporate auditor
positions, and remuneration of officers.
i. Support for Outside Appointments
Outside directors are supported by the General Affairs Department,
while outside Corporate auditors are supported by the Audit
Office.
j. Business Execution and Management Oversight
Outside appointments comprise more than half the members of
the Board of Corporate Auditors. This enables the Company thecapacity to sufficiently monitor the performance of duties by directors and also allows it to draw on independent third-party advice
from external experts appointed as outside directors. Directors andcorporate auditors also fully monitor how corporate officers execute business operations. This includes participating in meetings ofthe executive committee, which is made up of corporate officers,
as well as other key management meetings. When questions arise
during the course of business execution, the Company consults
attorneys, CPAs and other specialists for advice on determining thebest way to proceed.
2) Progress of the Internal Control System
The Board of Directors resolved at a meeting held on July 1, 2006,
to strengthen internal control systems for the purpose of ensuringthat Coca-Cola West and its Group companies conduct businessappropriately. At a meeting held on February 7, 2008, the Board
reviewed certain aspects of these systems, the results of which are
explained below.
a. Systems for ensuring that the duties of officers and­employees comply with laws and Company rules
Internal rules concerning compliance systems and a code of conduct have been established to encourage officers and all ­employeesb. Storage of information related to performance of
directors’ duties
In accordance with established rules for documentation management, documents and electronic files containing information related
to the performance of directors’ duties are to be recorded andstored, thereby allowing directors and corporate auditors to examine such documents and files at any time.
c. Rules and other systems related to managing the risk of loss
The department responsible for CSR will examine risks acrossorganizations and companies within the Group, working with eachdivision responsible for handling risks related to compliance, theenvironment, disasters, product quality, information security, etc.,
to create rules and guidelines, conduct training, and produce anddistribute manuals. The department will also promptly appoint
employees to take charge of measures to deal with new risks thatarise.
d. System for ensuring that directors perform their duties
effectively
The Board of Directors will determine Group goals shared by corporate officers and employees as well as the allocation of authority.
Representative directors will set specific targets for each Group
company and department aimed at achieving these goals, as wellas the methods for effectively working toward the goals, which
encompass authority allocation based on Group rules for decision
making.
e. S
 ystem for ensuring proper business conduct as a corporategroup made up of the Company and its subsidiaries
A department responsible for internal controls for the entire Groupwill be established at Coca-Cola West. Along with this, a structure
will be set up comprising systems for effectively conducting deliberations related to internal controls at Coca-Cola West and every
Group company, as well as for facilitating information sharing andcommunicating instructions and requests.
f. Arrangements for employees whose assistance is requestedby the Board of Corporate Auditors, and independence ofsuch employees from directors

In matters necessary for auditing duties, corporate auditors may
direct members of divisions in charge of items related to internal
auditing. While employees may receive directives from corporate
auditors when required for auditing purposes, directors and otherexecutives are barred from issuing such directives to employees
involved in auditing duties.
Furthermore, if corporate auditors request that employees be designated to assist them, proper arrangements must be made forthose employees.
g. System for corporate officers and employees to report to theBoard of Corporate Auditors
Directors will set up a system for corporate officers and employees
at Coca-Cola West and its Group companies to promptly report to
the Board of Corporate Auditors on legal matters, as well as on
matters that have a significant impact on the Group, the performance of internal auditing, and the status and details of reports
from the internal whistleblower hotline. The method for reporting,including who is responsible for submitting and receiving reports aswell as the time frames for reporting, will be determined throughdeliberations between directors and the Board of Corporate­Auditors.
h. System for ensuring that other auditing by the Board of
Corporate Auditors is conducted effectively
Regular meetings will be organized for corporate auditors and representative directors to exchange views.
3) Risk Management System

Other Information

at Coca-Cola West and its Group companies to observe laws andordinances as well as Company rules, and to act in line withaccepted social norms. They were especially intended to establish
a systematically firm policy against any involvement whatsoever
with organized crime and other anti-social forces. Furthermore, toimplement thorough compliance systems, a department responsible for CSR will be established at Coca-Cola West to unify compliance efforts across the Group and conduct educational activities
for officers and employees.
The department responsible for internal audits shall examine thelevel of cooperation with the department responsible for CSR andthe status of compliance across the Group, and then report these
activities regularly to the Board of Directors and the Board of Corporate Auditors. In addition, an internal whistleblower hotline will be
set up as a means for officers or employees to directly provide
information on conduct that may violate laws and ordinances.

Coca-Cola West has established the Coca-Cola West Group Risk
Management Committee. The objective of this body is to minimize
damage in the event of a crisis by preventing confusion within theGroup and ensuring a rapid and appropriate response. The Group
recognizes that the only way to realize its management principles is
to comply with all laws and ordinances and observe the norms ofsociety, thereby gaining the trust of all of its stakeholders. This conviction is enshrined in its Code of Conduct, which is designed toencourage a compliance mindset among all Group corporate officers and employees.
4) Audit System
a. Participating Personnel and Organizations
Coca-Cola West aims to comply with corporate rules and regulations, carry out appropriate corporate activities and operational
management, and protect its assets. To help it achieve these goals,
the Company has established the Audit Office within the Internal
Audit Department. The office has 13 members and reports directly
to the president.
Corporate auditors attend meetings of the Board of Directors,
executive committee and other important management meetings.
They also meet a representative director on a regular basis andexamine the results of audits performed by the Audit Office. Using
these and other methods, corporate auditors monitor the executive actions of directors and executive officers in accordance with
relevant laws and regulations, the Company’s own articles of incorporation and internal auditing standards.
Annual Review 200931

Corporate Governance Framework
General Meeting of Shareholders
Election and dismissal
Independent
AuditorReportingManagement­Advisory Committee

Auditing

Election anddismissal

Election and dismissal
Audit reports

Board ofDirectors
AdviceBoard ofCorporate Auditors

Selection and supervision
Auditing
Representative
Directors

Group Company
Presidents’ Meeting

Exchange of views
Reporting

Coordination
Audit Office

Management
MeetingCoor­
dination

Reporting

Department­responsible for CSR

Supervisionof compliance
Risk management

Auditing
DivisionsGroup companies

Other Information

Group Risk Management Committee

The Audit Office carries out prior discussions with corporate auditors concerning its auditing policy and plans for each fiscal year.
Corporate auditors also receive reports about the results of auditsof the Audit Office as needed. In addition, at the start of the fiscal
year, the Company’s independent auditor provides the corporate
auditors with an explanation of its audit plans, and as needed, supplies information and reports to the auditors during and at the endof the audit process.
b. Independent Auditor and Related Personnel
Coca-Cola West has appointed KPMG AZSA & Co. as its independent auditor. The names of the firm’s certified public accountants(engagement and management partners) that audit the Company’s
financial statements are listed as follows.
Name

Auditing Experience

Tetsuzo Hamashima

5 years

Takaki Okano

1 yearJunichi Adachi

2 years

The auditing team has twenty-eight additional members including
eleven CPAs and one assistant CPA.
5) Director and Corporate Auditor Remuneration
Remuneration paid to directors and corporate auditors for the
fiscal year under review was as follows.

32

Annual Review 2009

Number ofmembers

Total­remuneration

Directors Notes 1 and 3(Outside directors)

11(2)¥281 million(¥14 million)

Corporate auditors Notes 2 and 3(External corporate auditors)

7(4)¥45 million(¥15 million)

Total members(Total outside appointments)

18(6)¥327 million(¥29 million)

Roles

Notes:
1. B
 y a resolution of the General Meeting of Shareholders held on March 24,
2009, the maximum remuneration for directors was set at ¥500 million
annually, and of that amount, the maximum remuneration for outside
directors was set at ¥50 million annually.
2. B y a resolution of the General Meeting of Shareholders held on March 24,
2009, the maximum remuneration for corporate auditors was set at ¥100
million annually.
3. T he amounts above include remuneration paid to one director and two
corporate auditors (one of which was an external corporate auditor) who
retired from office as of the conclusion of the General Meeting of
Shareholders held on March 24, 2009.

(2) Conflicts of Interest
One of the Company’s two outside directors is a representative
director at a business partner that the Company treats as anequity-method affiliate.
One of the Company’s three outside corporate auditors is a representative of a partner financial institution. The remaining ­outside
corporate auditors have no conflicts of interest with the ­Company.

Board of Directors (As of March 31, 2010)

Representative Director

Representative Director

Representative Director

Director

Director

Norio Sueyoshi

Tamio Yoshimatsu

Hijiri Morita

Nobuo Shibata

Shigeki Ota

ChairmanPresident

Executive Vice President
Planning

Executive Vice President
General Affairs &Human Resources

Executive Corporate Officer
Finance

Director

Director

Director

Director

Director

Hiroyoshi Miyaki

Jiro Wakasa

Masamitsu Sakurai

Bjarne Philip Tellmann

Norio Hyouda

Executive Corporate Officer
CSR

Executive Corporate Officer
SCM &Head of Tokyo Office

Ricoh Co., Ltd.
Representative Director &Chairman

The Coca-Cola Company
General Counsel Japan AssistantGeneral Counsel at Bottling
Investments

Minami Kyushu Coca-Cola
Bottling Co., Ltd.
Representative Director &President

Auditors
Executive
Tadatsugu Harada
Corporate Auditor

Other Information

Directors

Management Advisory Committee Members
Standing

Corporate Auditor Tadamasa Amitsuka Standing
Corporate Auditor Zenji Miura

Director & Executive Corporate
Officer, Ricoh Co., Ltd.

Corporate Auditor Katsumi Sasaki

Representative Director & Vice
President, The Nishi-Nippon
City Bank, Ltd.

Corporate Auditor Yukiko Kyokane

Attorney & Representative of
Kyokane Law Office

Chairman Masamitsu Sakurai

Representative Director & Chairman,
Ricoh Co., Ltd.
Director & Chairman,
Coca-Cola (Japan) Co., Ltd.

MemberMasahiko Uotani

MemberShingo Matsuo

MemberKazuhiko Enomoto

MemberToshiaki Hanawa

MemberSusumu Ishihara

Representative Director & Chairman,
Kyushu Railway Company

MemberTakashi Matsuzaki

Attorney, Tokunaga,
Matsuzaki & Saito Law OfficeMember

Eiji Muto

Director & Chairman,
NTT Data Institute of Management
Consulting, Inc.

MemberKunio Ito

Professor, Hitotsubashi University

Representative Director & Chairman,
Kyushu Electric Power Co., Inc.
Representative Director & Chairman,
Fukuoka Jisho Co., Ltd.
Director & Supreme Advisor,
Royal Holdings Co., Ltd.
Director & Chairman,
Mitsubishi Heavy Industries Food &Packaging Machinery Co., Ltd.

Annual Review 200933

Stock Information (As of December 31, 2009)

•
•
•
•
•
•

Major shareholders

Stock code:

2579

Authorized shares:

270,000,000

Outstanding shares:

111,125,714

Number ofshareholders:

24,265

Number of shares Shareholding ratio
held (Thousands)(%)

Shareholders

Ricoh Co., Ltd.

16,792

16.8

The New Technology Development Foundation

5,294

5.3

Nomura Securities Co., Ltd. (Proprietary account)

4,533

4.5

Coca-Cola Holdings West Japan, Inc.

4,074

4.1

Stock exchange listings:

Mitsubishi Heavy Industries Food & Packaging­Machinery Co., Ltd.

3,912

3.9

 umber of sharesNper trading unit:

100 shares

Tokyo Stock Exchange (First Section)

The Nishi-Nippon City Bank, Ltd.

3,703

3.7

Osaka Securities Exchange (First Section)

Nomura Securities Co., Ltd.

3,308

3.3

Fukuoka Stock Exchange

Japan Trustee Services Bank, Ltd. (Trust account)

3,128

3.1

Northern Trust Co., (AVFC) Sub A/C American Clients

2,459

2.5

Kirin Holdings Co., Ltd.

2,226

2.2

Note: T he Company owns 11,150 thousand shares of treasury stock. This shareholding is not shownin the table and has not been included in the calculation of shareholding raio.

Other Information

Number of shares held and percentageof shares held by shareholder category
Number of Number ofsharesshareholders (Thousands)
Government and public bodies

10

Financial institutions

72

18,102

Securities companies

34

8,067

Other domestic corporations

477

39,971

Foreign corporations

259

21,762

Individuals and others

23,421

12,0701

11,15024,265111,125

Stock price and trends in stock trading volume
Stock price (Yen)

Stock trading volume (Thousands of shares)

3,000

2,500

2,000

Treasury stock
TOTAL

1,500

15,0001,000

10,000Government andpublic bodies%

0.0Treasury stock%

10.0

Individuals andothers%10.9

Composition
ofshareholders
Foreigncorporations%

19.6

Financial institutions
%

5,000

16.3

Securities
companies
%

7.3

0

2007
Other domestic
corporations%

36.0

Stock price at year-end (Yen)

2008

2009

2005

2006

2007

2008

2009

2,755

2,755

2,475

1,945

1,639

Credit Rating Information

34

2005

2006

2007

2008

2009

Japan Credit Rating Agency, Ltd. Long-term credit rating

AA–

AA–

AA–

AA–

AA–

Rating and Investment Information, Inc. Long-term credit rating

A+

A+

A+

A+

A+

Annual Review 2009

Corporate Data (as of December 31, 2009)•

Company name:•Head office:•Date of establishment:•

Paid-in capital:•

Fiscal year-end:•Primary business activity:

Coca-Cola West Company, Limited

7 – 9 – 66 Hakozaki, Higashi-ku, Fukuoka 812-8650, Japan

December 20, 1960

¥15,231 million
Head office

December 31

Other Information

Manufacturing and sales of Coca-Cola and other soft drinks

Web site

Coca-Cola West

Searchhttp://www.ccwest.co.jp/english/

Investor Relations page
The Coca-Cola West Web site provides
shareholders and investors with a wealth ofinvestor relations information including financial ­results, schedules of IR events, andmaterials for investors.

IR News Mail (Japanese only)
Users who register with this service will­receive regular quarterly announcements,
news releases, and other materials by e-mailin a timely manner.

The Coca-Cola West Web site was rated first in the food and beverage category of the Fiscal
2009 Web Site Rankings compiled by Nikko Investor Relations Co., Ltd. The site was also
awarded the Outstanding Performance Award for Internet IR from Daiwa Investor ­Relations
Co., Ltd.
Moving forward, Coca-Cola West will strive to make its Web site even more attractive to view,
clearly presented, and user friendly.

Annual Review 200935

Coca-Cola System in Japan (as of December 31, 2009)

Japan’s Coca-Cola System consists of Coca-Cola (Japan) Co., Ltd., 12 bottling companies (Bottlers) that manufacture and sell
Coca-Cola products in the different regions of country and other companies.

• Role of Coca-Cola (Japan) Co., Ltd. and Bottlers
Coca-Cola (Japan) Co., Ltd.

Planning

Research &development

Productionof concentrates

Bottlers
Product
manufacturing

Product
distribution

Sales

Collection ofcontainers

Recycling ofcontainers

Other Information

Bottlers (12 bottling companies)

Coca-Cola West Co., Ltd.
Fukuoka/Osaka/Shiga/Nara/Wakayama/
Kyoto/Hyogo/Okayama/Tottori/
Hiroshima/Shimane/Yamaguchi/Saga/
NagasakiMinami Kyushu Coca-Cola Bottling Co., Ltd.
Shikoku Coca-Cola Bottling Co., Ltd.
Okinawa Coca-Cola Bottling Co., Ltd.
Coca-Cola Central Japan Co., Ltd.
Tokyo Coca-Cola Bottling Co., Ltd.
Mikuni Coca-Cola Bottling Co., Ltd.
Tone Coca-Cola Bottling Co., Ltd.
Hokuriku Coca-Cola Bottling Co., Ltd.
Sendai Coca-Cola Bottling Co., Ltd.
Michinoku Coca-Cola Bottling Co., Ltd.
Hokkaido Coca-Cola Bottling Co., Ltd.

36

Annual Review 2009

Investment
Note: Figures in brackets show the percentage of shares owned, corresponding to voting rights
Joint companies of The Coca-Cola
Company and Coca-Cola (Japan) Co.,
Ltd., as well as bottling companies

6[15.0%]

Minami Kyushu Coca-Cola
Bottling Co., Ltd.

Coca-Cola Customer Marketing
Co., Ltd.
72[100%][4.1%][20.0%]

Coca-Cola Tokyo ­Research &Development Co., Ltd.
4The Coca-Cola
Company

1

Coca-Cola West
Co., Ltd.

[21.5%]

Coca-Cola Central Japan
Co., Ltd.
Tokyo Coca-Cola BottlingCo., Ltd.

Coca-Cola (Japan) Co., Ltd.
3
[21.7%]

8

FV Corporation Co., Ltd.

Tone Coca-Cola BottlingCo., Ltd.
Coca-Cola bottling
7 companies

Other Information[100%]

Coca-Cola Business Service
Co., Ltd.

5

1. Coca-Cola West Co., Ltd.

5. Coca-Cola bottling companies

In 2006, Coca-Cola West Japan Co., Ltd. and Kinki Coca-Cola

There are 12 bottling companies in Japan responsible for selling

Bottling Co., Ltd. merged their managements to establish the

Coca-Cola products in their respective territories.

joint holding company, Coca-Cola West Holdings Co., Ltd. In
January 2009, these three companies and Mikasa Coca-Cola

6. Coca-Cola Business Service Co., Ltd.

Bottling Co., Ltd. merged to form Coca-Cola West Co., Ltd.

Established through joint investment by The Coca-Cola Company
and its bottling partners in Japan, Coca-Cola Business Service

2. The Coca-Cola Company

began operations on January 1, 2007. It is charged with providing

Established in 1919 in Atlanta, Georgia, The Coca-Cola Company

business consulting services to the Coca-Cola organization in Ja-

holds the rights to grant licenses to bottlers to manufacture andpan, as well as developing and maintaining information systems

sell Coca-Cola products. The Coca-Cola Company or its subsid-

to support such work. Coca-Cola Business Service has also pro-iaries also conclude franchise agreements with bottlers.

cured raw materials since January 2009.

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

7. Coca-Cola Customer Marketing Co., Ltd.

Established in 1957 in Tokyo as a wholly owned subsidiary of The

Established through joint investment by Coca-Cola (Japan) Co.,

Coca-Cola Company under the name of Nihon Inryo Kogyo K.K.,

Ltd. and all of its bottling partners in Japan, Coca-Cola Customer

the company changed its name in 1958 to Coca-Cola ­(Japan)

Marketing Company began operations on January 1, 2007. It isCo., Ltd. It is responsible for marketing as well as the manufactur-

charged with holding business negotiations with major retail out-

ing and distribution of concentrate in Japan.

lets, such as nationwide convenience stores and supermarket
chains, as well as developing proposals for sales promotions and4. Coca-Cola Tokyo Research & Development Co., Ltd.

storefront activities.

Established in January 1993 as a wholly owned subsidiary of The
Coca-Cola Company, Coca-Cola Tokyo Research & Development

8. FV Corporation Co., Ltd.

has been carrying out product development and technical support

Jointly established in May 2001 by Coca-Cola Bottling Companies

since January 1995 to respond to the needs of the Asian region.

and Coca-Cola (Japan) Co., Ltd., FV Corporation Co., Ltd. carries
out sales negotiations with major vending machine operators inJapan, and deals with Coca-Cola and other products.
Annual Review 200937

7–9–66 Hakozaki, Higashi-ku, Fukuoka 812-8650, Japan
Investor Relations Tel: +81-92-641-8590
http://www.ccwest.co.jp/english/

Printed in Japan