Integrated Annual Report 2022

OPEN UPMOMENTSTHATREFRESHUS ALLStrategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingContents

2022 highlights

Strategic Report

Corporate Governance

Swiss Statutory Reporting

1
7
9
12
14
16
19
21
23
24

94

223 Report of the statutory auditor
on Coca‑Cola HBC AG’s
consolidated financial
statements
228 Report of the statutory auditor
on Coca‑Cola HBC AG’s financial
statements
230 Coca‑Cola HBC AG’s financial
statements
240 Report of the statutory auditor
on the Remuneration Report
242 Statutory Remuneration Report

28
32
36
38
43
45
54
57
59
80
82
84
88
91

Our purpose
Chairman’s letter
Chief Executive Officer’s letter
Our business at a glance
Our business model
Stakeholder engagement
Market trends
Our purpose framework
Our strategy
Leverage our unique
24/7 portfolio
Win in the marketplace
Fuel growth throughcompetitiveness and investment
Feature: Egypt
Cultivate the potentialof our people
Feature: Ukraine
Earn our licence to operate
Key performance indicators
Mission 2025 Sustainability
commitments
Managing risk and materiality
TCFD recommendations
Viability statement
Financial review
Segment highlights
Non-financial reporting directive

Coca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Chairman’s introduction
to corporate governance
98 Board of Directors
101 Corporate Governance Report
128 Directors’ Remuneration Report
156 Statement of Directors’
responsibilities
Financial Statements
158 Independent auditor’s report
166 Financial statements
170 Notes to the consolidated
financial statements

Supplementary Information
245 Alternative performancemeasures
250 Assurance statement
253 Shareholder information
254 2022 SASB index
257 Glossary

Volume (m unit cases)

Net sales revenue (€m)

2021: 2,412.7

2021: 7,168.4

Comparable EBIT1 (€m)

Comparable EBIT1 margin (%)

2021: 831.0

2021: 11.6

2,711.8 9,198.4
929.7

10.1

Profit before tax (€m)

Net profit2 (€m)

2021: 734.9

2021: 547.2

623.6

415.4

Comparable EPS1 (€)

Basic EPS (€)

2021: 1.584

2021: 1.499

1.706

Primary packaging collected
for recycling (equivalent)

48%

1.134
Energy-efficient coolers

49%
2021: 42%2021: 46%

Integrated report online
Please click here to view our integrated
report online
https://www.coca-colahellenic.
com/en/investor-relations/2022integrated-annual-report

Front cover: This is a team from Coca‑Cola HBC
Egypt enjoying a sparkling beverage break.

1. For details on APMs, refer to ‘Alternative performance measures’ section.
2. Net profit refers to net profit after tax attributable to owners of the parent.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Our purpose

OUR WORKREQUIRES SEALINGREFRESHMENT IN...

Coca-Cola HBC Integrated Annual Report 2022

1

2

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Our purpose continued…BUT IT’S THE
MOMENTS WE
OPEN UP THAT
MATTER MOST

Delivering forour stakeholders
At Coca-Cola HBC we look to createand share value with all our stakeholders.
Read more on pages 16-18

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Our purpose continued

WE OPEN UPOPPORTUNITIESFOR OURCUSTOMERSAND PARTNERS
Our customers

Our suppliers

We put our customers first, creating sharedvalue and growing their, and our business.

We are working together to reduce
emissions across the value chain.
Partnership with our suppliers helps
us to avoid supply chain disruptions.

Read more on pages 28-31

The Coca-Cola
Company
Our longest standing and closest strategic
partner: we have worked together since 1951.
Read more on page 18

Read more on pages 32-35

3

4Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Our purpose continued

WE OPEN UP
EMPLOYEES TO
THEIR FULLPOTENTIAL

Our people
People are our most important asset.
We are investing behind our people, building
the best teams in the industry and creating
an inclusive growth culture.
Read more on pages 38-42

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Our purpose continued

WE OPEN UP LIFE
TO EXPERIENCES
THAT DELIGHT

Our consumers
Our 24/7 portfolio caters to a growing
range of tastes and offers choice acrossevery occasion, all in increasingly
sustainable packaging.
Read more on pages 24-27

56Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Our purpose continued

AND WE OPEN UP
THE CHANCE TO
MAKE A DIFFERENCE

Our communities
We are a part of our communities,
providing employment directly or
through the wider value chain. We makea difference through programmes like
#YouthEmpowered and through progresson our sustainability commitments.
Read more on pages 45-53

NetZeroby40
We are fully committed to our ambitious
net zero target, with management
incentives aligned. To achieve this goal
we need to collaborate with our existing
and future partners.
Read more on page 48

Coca-Cola HBC Integrated Annual Report 2022

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Chairman’s letter

LEADERSHIPFOR LONGTERM SUCCESS“We are proud to continue
opening up moments that
refresh us all, both now
and in the future, with thelong‑term needs of all our
stakeholders at the heartof our decision making.”
Anastassis G. David
Chairman of the Board

Dear Stakeholder,2022 was a challenging year for many businesses,
and Coca-Cola HBC was no exception. From thevery early days of the war in Ukraine, we havefocused on the health and safety of our people.
We are providing aid to both our colleagues andcommunities and will continue to do so.
The conflict between Russia and Ukraine has
affected our business in those countries andbeyond, as commodity prices increased andinflation rose.
While facing difficulties, our people constantly
give their best. We have seen this throughpandemic-related disruptions and now, withnew unimaginable challenges due to geopolitical
upheaval. Our Ukraine team in particular has
shown tremendous perseverance and care,requesting in May that we restart production
outside Kyiv so they could return to serving
customers. I would like to extend my thanks to allof our people across the Group for their dedication,commitment and sheer enthusiasm to deliver for
all our stakeholders.

Coca-Cola HBC Integrated Annual Report 2022

7

8Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Chairman’s letter continued
Seizing opportunities
Our acquisition of the Coca-Cola bottler in
Egypt was completed at the beginning of the year,
expanding our footprint in high-growth markets.
I had the pleasure of meeting the team in Egypt
during the year and saw first-hand how well they
are integrating within the Coca-Cola HBC family.
I was particularly impressed by their dedication totheir customers and their communities – importantvalues we share.
The Board has followed the integration of this newmarket closely. We remain convinced that sharing
the Group’s proven capabilities, experience andbest practices will unlock the growth potential of
Egypt, opening opportunities for our people
and the wider community there, as together
we positively impact livelihoods and improvesustainability practices at scale.

Purpose and strategy
Throughout the last year, despite, and indeed
because of turbulence and challenges, the Board
has remained focused on our medium-term
Growth Story 2025 strategy, creating value for ourcustomers and delighting consumers. By remaining
focused on our strategy, we have been able toprioritise the actions and investments that havepositioned the company for sustained success.
Our performance in 2022 was testament to this.
Coca-Cola HBC delivered strong financial
performance with record levels of comparable
EBIT, free cash flow and strong ROIC.

It was also another year where the company madeprogress towards our vision of being The Leading
24/7 Beverage Partner with investments behindthe 24/7 portfolio, our capabilities and sustainability.
I was particularly proud that the Company was
ranked this year as the number one beveragecompany globally by the Dow Jones
Sustainability Index1.

As part of our Mission 2025, we are committed
to enhancing biodiversity by reducing emissions
and water use, preserving and re-instatingwater priority areas, and by sourcing agriculturalingredients sustainably. Our aim is to leave nature
in a state better than the one we found it in.

Climate change is a critical priority for mankind
and there is much-needed pressure to tackle
this and other sustainability issues. We are wellequipped to face these challenges thanks to thestrength of our portfolio, proven capabilities andcommitted partnerships.

For more on this, and our ambitious Mission 2025
sustainability targets,see page 57.

As geopolitical turmoil and macroeconomic
uncertainty continue, it is more important thanever that we inspire and empower our people
to act with speed and agility, keeping customers
at the heart of what they do. To further refine
our focus, we as a Board have approved andchampioned a new purpose for our Company:
open up moments that refresh us all. This
captures the essence of what we bring to ourcustomers, consumers and communities,
spreading delight with our iconic and loved brands.

We had no new Board members in 2022, so it’s
been an opportunity to cement Board performance
as a team. The feedback from our annual Board
effectiveness study was extremely positive andwe will be implementing the follow-up actionsin the coming months.

Constant change in the global economy is the newnormal, and it is more important than ever that wehave taken the necessary steps to position the
Company to remain resilient and adaptable.

Leadership in action
I’m extremely proud of how the Board has
performed during another challenging year.
We have robust discussions, representing a varietyof viewpoints which allow rigorous evaluationand decision making that benefits all our
stakeholders in the long term.
We also continue to take bold decisions regarding
sustainability, approving new, long-term targets
for food waste and biodiversity during the year.

1. As per the DJSI results, 9 December 2022.

Dividend growth
For 2023 the Board is proposing a dividend of€0.78 per share. This is a 9.9% increase versus
the €0.71 dividend paid during 2022, maintaining
our commitment to a progressive dividend.
This proposed dividend will represent a 46%
pay-out ratio, within our targeted range of 40
to 50% of comparable EPS.
The consistent growth of our dividend is
testament to our confidence in the strong
fundamentals of our business, as well as ourcommitment to shareholders.

The financial performance of the business overthe last few years, despite the impact of COVID-19,
inflation and war, is testament to the way that
we have strengthened the business since the last
economic downturn. I am very proud of the work
the team has done to prioritise investment behind
our most critical drivers of future performance
while retaining a laser-sharp focus on costs.
This work will continue, alongside initiatives tofurther embed our values-based culture to deliveron our purpose.
Our people and culture are at the heart of our
success. We continue to open up momentsthat refresh us all and will continue to do so forgenerations to come.

Looking ahead
As I write, fighting and humanitarian sufferingcontinue in Ukraine and the macroeconomic
climate, while showing signs of improvement,
remains uncertain.

Anastassis G. David
Chairman of the Board

Section 172 statement
Section 172 of the UK Companies Act 2006 requires directors to promote the success of theircompany for the benefit of the members as a whole, having regard to the interests of stakeholders intheir decision making. Engaging with stakeholders is an indispensable part of how Coca-Cola HBC does
business. The Board considers the interests of the Group’s employees and other stakeholders in its
decision making as a matter of good governance, and understands the importance, and value, of taking

into account their views, as well as considering the impact of the Company’s activities on thecommunity, environment and the Group’s reputation. The Board also considers what is most likely
to promote the success of the Company for its shareholders in the long term. Although the Company
is Swiss-incorporated and as such the UK Companies Act 2006 has no legal effect, this approachis in accordance with the UK Corporate Governance Code 2018.

Read more about: How we manage risks and materiality on pages 59 to 81 and how we engage with key stakeholders on pages 16 to 18

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Chief Executive Officer’s letter

OPENING UPOPPORTUNITIES
Dear Stakeholder,“While our work requires
2022 was a year that will be remembered forsealing beverages in,
the immense challenges faced by so many, thethe real magic happens
tragic war in Ukraine and the difficult economic
conditions that followed across the globe.
when they are opened up.
The impact of war was acutely felt by our people
Our true purposein Ukraine, where we have operated for overcomes from opening up
30 years. Our focus and care remain with ourcolleagues and their families who are suffering.
possibilities with our
The Coca-Cola System was united in its response,
committing to contributions of more thancustomers, partners andmillion to support our colleagues and theemployees to create value US$20
humanitarian efforts across the region. We havealso announced an additional donation of €10
for all we serve. It’s thisby Coca-Cola HBC to help our colleagues
optimistic spirit that drives million
and their communities rebuild their lives.
us towards new markets,
In the early stages of the conflict and since,
our people did what they could to alleviate the
new relationships, newsuffering in the region – volunteering their time,development opportunities, providing transport and accommodation, andopening their homes to colleagues fleeing Ukraine.
and new ideas for a
It is this spirit of togetherness in these darkest
better future.”of times that gives us hope for a brighter future.
Zoran Bogdanovic
Chief Executive Officer

910Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Chief Executive Officer’s letter continued
Following the decision of The Coca-Cola
Company on 8 March to suspend its business in
Russia, we immediately stopped placing orders
for concentrate in the country and stopped all
investment from the Group. We depleted thebrands of The Coca-Cola Company in the market
and transitioned to a local, self-sufficient businessin Russia, which is managed by a local team andfocused on local brands. This decision was thebest way to protect our people and assets.

Egypt, an exciting acquisition
An exciting milestone in our Growth Story came inJanuary, with the acquisition of Coca-Cola BottlingCompany of Egypt.
Due to its size and demographics, we see
immense potential to unlock growth opportunities
in the Egyptian market. With our leading commercial
capabilities, together with the talent and energyof the Egyptian team, I am confident that we canincrease penetration of our portfolio, enhance
profitability and grow market share.
It is our vision to be the leading 24/7 beverage
partner in every market in which we operate andour ambitions for Egypt are no different.
In November, together with our Chairman,
Anastassis David, I returned to the Egyptian
market and visited the bottling plant in Sadat,
where we are expanding capacity. Following our€16 million investment, we saw the team preparing
for the installation of a new, high-speed can line,
to expand production in this prioritised
packaging type.
In just a few months the team has been improving
and we are already at an advanced stage of
integration with Coca-Cola HBC policies, systems
and structures. We have enhanced route-to-market
and revenue growth management capabilities, andstarted the important process of migration to our
Coca-Cola HBC SAP S/4HANA platform.

I’m also pleased to see that the integration is
opening up learning and development opportunities
for our colleagues in Egypt – a strong indicatorof future success.

Executing our Growth Story
Against a challenging backdrop, it is a testament
to the strength of our business, our culture
and our team spirit that we have continued toperform so well.
Our portfolio and capabilities ensure that we
continue to increase share in a growing industry.
Volumes grew across all our markets, excluding
Russia and Ukraine, while we also expanded
revenue per case. Moreover, despite historicallyhigh levels of inflation, we delivered record levelsof comparable EBIT and free cash flow1, excellent
returns on invested capital and maintained
a strong balance sheet.
Our robust performance confirms that ourinvestments across our prioritised capabilities
have been the right ones, particularly in thisinflationary environment. One of our priority
capabilities, Data, Insights & Analytics (DI&A),
is providing valuable sophistication in two others,
Revenue Growth Management (RGM) and
Route-to-Market (RTM). These complement theoverall strength of our other prioritised capabilities:
Key Account Management and Digital Commerce.
We are successfully managing the pricing of our
products to customers and value for them, while
promoting affordability for shoppers. We areparticularly pleased we remain the number one
contributor to revenue growth within the FMCG
industry across for our retail customers2.

1. For details on APMs refer to ‘Alternative Performance
Measures’ and ‘Definitions and reconciliations of APMs’ sections.
2. Nielsen

Accelerated investments behind digitalisation andtechnology continue to be a key enabler of our
growth and business transformation. Within our
ambitious agenda we are making significant
strides in digital commerce. This is generating
incremental revenues for our business, whileproviding invaluable customer and consumer dataand insights that continue to inform our strategy.
We recognise that our long-term successcannot be achieved alone, and our performanceand delivery of our Growth Story strategy isunderpinned by the strength of our partnerships.
We embrace our opportunities and challenges
together with our closest strategic partner,
The Coca-Cola Company, and all our other brandpartners. Equally we are committed to working
collaboratively with all our customers, suppliers
and other stakeholders, and are grateful for theirtrust and support – particularly in the current morechallenging operating environment.

Our 24/7 portfolio
We are proud to have developed one of thestrongest, broadest and most flexible portfolios
in the industry and we continue to invest for the
future. Three of our most important categories,
Sparkling, Energy and Coffee were key growth
drivers in 2022.
The sparkling category remains our biggest
focus and largest opportunity as the single mostimportant driver of growth and profit. We havecontinued to gain significant share in Sparklingin 2022, benefitting from strong activations
throughout the year, particularly around thesummer season and Christmas. Low- andno-sugar variants maintained good momentum,with volumes up double digits in the year, growing
ahead of regular offerings in all segments.

We launched Coca-Cola Zero Sugar Zero
Caffeine across a range of markets last year
and will continue to scale this innovation in 2023.
Adult Sparkling, including brands like Schweppes
and Kinley, remains a jewel in our portfolio, which
we have consistently invested behind given its
huge potential.
Energy continues to increase its share of ourbusiness and in the market. With volumes up by
32% on an organic1 basis excluding Russia andUkraine in 2022, this category now makes up
6% of our Group revenue. We continue to see
potential for growth through increased penetration
across our markets and the launch of Energy in
Egypt in 2023. Similarly, we have been investing
behind our Coffee portfolio with Costa coffee
now in 16 markets and Caffè Vergnano, thesuper-premium coffee brand, in 14 markets.
We are building dedicated teams and investing
behind coffee-specific capabilities. This investment
is creating the opportunities for further growth,and in 2022 we grew volumes 45%, on an organic
basis excluding Russia and Ukraine, and gained share.

Investing in our people
We are proud we remain among the top 10 most
attractive employers in the FMCG industry acrossall our markets3 and we continue to invest to
create an enjoyable and inclusive work environmentthat nurtures and develops all our people.
This includes reshaping how we work together.
In 2022, we launched Project Oxygen, a programmethat will simplify our business processes, reducing
bureaucracy and complexity. The aim is to free
up our people to focus on the work that mattersmost. To understand the levels of internal
collaboration across functions, we deployed
the same NPS methodology we use to measurecustomer satisfaction.

3. Universum 2022.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Chief Executive Officer’s letter continued
We have a dedicated plan in place for 2023 toaddress the pain points that will drive maximum
impact for our people and our business.
A culture of learning is key to our success, andwe are proud to report that our people undertook
almost one million hours of learning in 2022.
This included our third Learn Fest, a virtual eventthat saw almost 6,000 attendees. This builds onthe dedicated talent programmes and ‘Academies’
for our Business Developers, Supply Chain andother functions.
We remain committed to making tangible
progress towards achieving gender balance atmanagement level by 2025, and are accelerating
our efforts. In 2022, women held 39.6% ofmanagement roles, so while we are on the righttrack, there is more to do to reach our 2025 goal.
Our plan includes addressing issues of retention
and recruitment of female talent, and we have
deployed dedicated leadership and development
actions and targets across our markets.
Keeping our people safe remains our mostimportant priority. We have set clear standards
and targets for this throughout the business, andour culture of collaboration is helping to createa team that supports, trusts and cares for one
another. While we are making consistent progressover time, any accident is one too many. We must
and will do better.

Investing in a more sustainable future2022 saw us invest seriously behind our Mission
2025 sustainability commitments and our goalto achieve net zero emissions across our value
chain by 2040.
We made significant progress on our packaging
agenda, moving our entire locally produced
portfolio in Switzerland to 100% recycled PET(rPET). At the same time in Switzerland, Valser
water transitioned to a label-free bottle, reducing
plastic use and improving recyclability.

To help us reach our rPET goals, we have invested€45 million in in-house rPET facilities to date. This
includes our Gaglianico plant in Italy that willtransform up to 30,000 tonnes of PET per year
into new 100% recycled PET preforms, enough tomeet our annual beverage bottling needs in the
country. It also reduces the carbon footprint of
producing a preform by up to 70% compared with
virgin plastic. We have introduced rPET production
technology in Poland too, and Romania will follow
later this year.
We issued our first green bond for €500 million in
September, with proceeds to be allocated toeligible green projects that accelerate progress
towards our sustainability goals.
The year culminated with our twelfth consecutive
ranking in the top three beverage companies
globally by the Dow Jones Sustainability Index4,
and this year we were ranked world number one
for a sixth time. We are honoured that our score
positioned us top among 7,822 companies across
61 industries according to the recently issued S&P
Global Sustainability Yearbook 2023. We were also
recognised as an ‘Industry Mover’5 as, with aseven-point increase, we were the most improvedin the beverage industry since last year.
Still, as I reflect on the scale of the climate
challenge, I draw again on the importance ofpartnerships for progress. Working together withour customers, suppliers, industry and community
partners, we are identifying and scaling thesolutions that will make a difference. We havebeen investing time and resources to build abroader network and to explore the ideas andtechnologies of the future. It is also ourcommitment to listen and learn from all
stakeholders along the way.

4. As per DJSI results, 9 December 2022.
5. S&P Global Sustainability Yearbook 2023, as of 7 February 2023.

Outlook for 2023 and beyond
We are fortunate to operate in a growing industry
with very strong brands. While we are mindfulof the macroeconomic environment, to datethere have been only a handful of our markets
where we have seen changes in consumer
behaviour or signs of slowdown.
Whatever 2023 brings, we are confident in theresilience we have built in our business in recent
years, and have the trust that we can overcome
any obstacles that come our way. This confidence
comes from the winning spirit that I saw across
many of the markets I had the pleasure of visiting
in 2022. Thanks to the dedication and passionof our people, there are an abundance ofopportunities that are opened up daily. This growthmindset is supported by the strong customer
relationships we have forged, which will stand us
in good stead even in challenging times.
Together with the strength of our portfolio, thediversity of our markets and our capabilities, 2023
will be another year of acceleration towards our
vision of being The Leading 24/7 Beverage Partner.

This purpose is our guiding light for the future
as we seek to refresh generations to come. Our
success is down to how we come together as one
company. We can only make a difference when it
serves us all. Having a meaningful impact takes
each one of us, working side-by-side, with agenuine concern for our communities and theplanet. And always through the lens of sustainability.
My experience in over two decades with CocaCola HBC has shown me that our people make all
the difference. With that, I would like to thank all
my colleagues who continue to create the magic
every day that makes me so proud to work for thiscompany and this team.
I also extend my gratitude to all our customers,
The Coca-Cola Company and all our partners
and stakeholders. In this year of challenges, wehave had to adapt to win, and fundamentally it
is our togetherness that has contributed to ourrecord performance and our strong belief
in the future ahead.

Opening up moments that refresh us all
In 2022, we took time to reflect on our wider
purpose and culture as a business. We drew onmore than 70 years of history, our innate values
and our hopes for the next chapter of growth todefine our new purpose: open up moments that
refresh us all.
This recognises that while our work requires
sealing beverages in, the real magic happens when
they are opened up. Our true purpose comesfrom opening up possibilities with our customers,
partners and employees to create value for all
we serve. It’s this optimistic spirit that drives us
towards new markets, new relationships, newdevelopment opportunities and new ideas fora better future.

Zoran Bogdanovic
Chief Executive Officer

11Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Our business at a glance

The Leading 24/7
Beverage Partner
Coca-Cola HBC is a
growth‑focused consumer
packaged goods businessand strategic bottling partnerof The Coca-Cola Company.

Diverse, growing markets

Unrivalled product portfolio
Our portfolio is the strongest and broadestin the beverage industry. Our products caterto a growing range of tastes with a wider
choice of healthier options. We differentiate
ourselves with premium products andincreasingly sustainable packaging, enabling
us to open up moments that refresh ourconsumers 24 hours a day.

Our roots date back to 1951 when A.G. Leventis
founded the Nigerian Bottling Company in Lagos.
Since then the business has expanded, fromArmenia to Austria, from Egypt to Estonia andfrom Serbia to Switzerland. In 2022 we completed
the acquisition of the Coca-Cola Bottling Companyof Egypt, bringing the total number of countries
where we operate to 29.

Integrated approachto sustainability
We endeavour to create value for all our
stakeholders. We make a strong contribution
to developing the societies in which we operate
through employment and our wider supply
chain, as well as through supporting community
projects. We operate in a way that preserves ourenvironment, integrating sustainability into ourdecision making and actions.

29

countries

715 million
consumers

33,000employees

TH
E

ING
AD
E
L

Established markets

32%

10.3%

of Group revenue

Comparable EBIT
marginNE

R

Developing markets

RT

12

B E V E R AG

Explore our 24/7 brands:
www.cchbc.com

A
EP

19%

6.7%

of Group revenue

Comparable EBIT
marginEmerging markets

49%

11.3%

of Group revenue

Comparable EBIT
marginFor details on APMs refer to ‘Alternative Performance Measures’and ‘Definitions and reconciliations of APMs’ sections on
page 246-249.

Diverse markets
We produce and sell an unparalleled portfolioof beverage brands relevant to every customer,
consumer and occasion. Our route to market
includes a wide range of consumer channels –from supermarkets and convenience stores tohotels, cafés and restaurants – and encompasses
more customers than any competitor. Customer
service and focus are critical for our business and
we are devoted to helping our customers growtheir businesses, which in turn grows ours.

120 bpsvalue share gained in NARTD

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Our business at a glance continued

Our 24/7 portfolio

We have a drink for every occasion during the day, from sunrise to sunset.
Our strategic priorities are Sparkling, Energy and Coffee. Sparkling,including Adult Sparkling, is 72% of our business. Energy comprises 6%,
with a 32% growth rate in 2022, on an organic basis excluding Russia
and Ukraine. Coffee is smaller at less than 1% of revenue, but with a 45%
growth rate in 2022, on an organic basis excluding Russia and Ukraine.

Percentage of Coca-Cola HBC revenue
Organic growth excluding Russia and Ukraine

SPARKLING

Adult Sparkling1

72%

5%

+7.7%

Juice Tea

Plant-based

7%

<1%

2%

+9.5%

ENERGY
6%2+32%

Hydration
7%

COFFEE

Snacks

<1%

<2%

+45%

Premium Spirits
1. Adult Sparkling is a category within Sparkling
2. 7% excluding Egypt acquisition and Multon consolidation

3%

13

14

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Our business model

Delivering value forour stakeholders
Our capital resources

1
Working with suppliers

Human

We work with our suppliers to procure high-quality
ingredients, sustainably sourced raw materials, andequipment and services required to produce beverages.

Our success is dependent on the passion andcustomer focus of our talented people – our secret
ingredient. We empower them to pursue growth
opportunities, both for themselves and our Company.

What we do

Natural
To create our products, we use natural resources
including water, energy and PET. We sourcethese using sustainable practices and seek to usethem efficiently.

Social and relationships
Maintaining the trust of stakeholders is essential to
our business. Our most valuable human connections
and relationships are with The Coca‑Cola Company,
our people and the communities we operate in, andour customers, suppliers, governments and regulators.

Financial
Our business activities require financial capital, which
we allocate efficiently. This capital is provided by ourequity and debt holders, as well as cash flow earned
from our operations.

How we do it

We are a strategic bottling partner of
The Coca-Cola Company

4Serving
our consumers
and communities
Our 24/7 product portfolio
caters to a range of tastes
and preferences and wecontinually innovate to leadthe sector.

We have the exclusive right to manufacture and sell the
beverages of The Coca-Cola Company in our markets. We also
partner with other beverage businesses such as Monster
Energy, Brown-Forman, Campari and Edrington to sell theirproducts in our markets.

How our partnership works

The Coca-Cola Company owns and develops its brands while
Coca-Cola HBC is responsible for producing, distributing andselling these beverages, using concentrate we buy from The
Coca-Cola Company under an incidence-based pricing model.
We work together to ensure we have the right portfolio for ourcustomers and consumers in each market and to ensure
excellent, efficient execution. We also share marketing costs
and responsibilities, with The Coca-Cola Company marketing
to consumers, while we take responsibility for trade marketing
to our customers.

2
Producing beverages
efficiently andsustainably
Using concentrate fromThe Coca-Cola Company
along with other ingredients,
we prepare, package anddeliver products with an
optimised manufacturing
infrastructure andlogistics network.

Intellectual
Innovation is embedded in our culture. The intellectual
property from innovation includes new packaging
know-how, new products and improvements in
manufacturing, logistics and sales execution.

Manufacturing
Investing in our plant and logistics assets allows us toefficiently prepare, package and deliver our products
to meet the needs of customers and consumers.

3
Partnering with our customers
We grow by supporting our customers’ growth, leveraging
our 24/7 portfolio, focusing on areas of high-value
opportunity and executing with excellence.

Read more about how weleverage our unique 24/7
portfolio and win in themarketplace on pages
24 to 31.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Our business model continued

Value created
Our people• In 2022 we provided jobs directly to 33,043 employees
in 29 countries*• Median basic salary ratio women/men: 1.13

Our customers• We increased the frequency of our customer
engagement, providing customers with the best support• In the marketplace we achieved a total number of 49%
energy‑efficient coolers

Our communities• In 2022, we trained 246,108 young people through our#YouthEmpowered programme to boost employability• We invested €7.4 million in local community initiatives*

Our shareholders• We delivered strong financial performance in 2022, withorganic revenue up 14.2% and reported revenue up 28.3%• In recognition of our business strength and future
opportunities, the Board has proposed a dividend of€0.78 per share, a 9.9% increase compared with last year

Our wider stakeholders• Our business activities generate revenue for our suppliersand contractors and their extended value chain

Our consumers• We provide high-quality beverages and healthy options,
reducing calories per 100ml of sparkling soft drinks
by 17% in 2022 compared to our 2015 baseline

Socio-economic contribution>900,000

total employee costs

40%

1.7m

women in managerial
positionscustomers served

794,943

1 = 10job in the
Systemcumulative number of young people
trained in our communities between
2017-2022

jobs in ourcommunity

323,727

indirect jobs across the value
chain€10.8bcreated in added value
across our value chain

potential consumers
refreshed>16,800*
suppliers operating
across our value chainc.5*€bspent with local
suppliers* With the addition of Egypt.

Measuring and managing
these contributions throughthe sustainable growth of ourbusiness is an important partof our purpose. Since 2010
we have conducted socioeconomic impact studies in ourmarkets to better understandthe range and extent of the value
we create in our ecosystem.

CapEx spend

paid in taxes

715m*

We believe that the only way
to create long-term value forall our stakeholders is throughsustainable growth. We createsocio-economic value for thesocieties in which we operateby creating jobs, training people,
building physical infrastructure,procuring raw materials,
transferring technology, paying
taxes, expanding access to
products and services, andcreating growth opportunities
for our customers, distributors,
retailers and suppliers.

€589.5m€3.6b

Our suppliers• We spent circa €5* billion with local suppliersand contractors• We are working with our suppliers to support theirsustainable practices and emission reduction plans€1,204m*

training hours forour people

Our impact

To read the methodology
behind our socio-economic
impact numbers, please see
page 25815

16Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Stakeholder engagement

Building on over 70 years of stakeholder
engagement for mutual benefit
Our people
Material issues• Employee wellbeing
and engagement• Human rights, diversity
and inclusion
Growth pillars

Key challenges• Building the best teamsin the industry• Engagement as remote
working continues• Mental wellbeing
How we engage• Focused and continuous
conversations• Employee Assistance
Programme• Regular employee surveys
to understand and act
on needs and wellbeing• Offering personalised
experiences andopportunities for personal
and professional growth• Ongoing dialogue with
employee representative
bodiesOur customers
Outcomes of engagement• Maintaining high engagementlevels• Higher levels of satisfaction
with line manager support
were reported as we
addressed the needs ofpeople working under
different conditions
Relevant KPIs
• Employee engagement• Percentage of managers
that are women• Lost time accident rate
Principal risks• Health and safety• People retention• Geopolitical and security
environment

Read more on pages 38-42

Material issues• Economic impact• Nutrition• Packaging and waste
management• Food loss and waste
Growth pillars

Key challenges• Opportunities for growthand value creation• Offering a 24/7 beverage
portfolio that meets thechanging preferencesof consumers• Supply and delivery challenges
How we engage• Key account managers
engage with our customers
at a strategic level• Our business developers
continue to make regular
visits to outlets• Partnering to reduce foodloss and waste• Introducing new packaging
types in the assortment andsupporting packaging
collection

The strength of our stakeholder
ecosystem enabled us to ensure
the safety of our people, partners
and communities while maintaining
production throughout the year.
Our consumers

Outcomes of engagement• We increased direct
engagement via ourcustomer teams and via
customer surveys• Programmes to reduce foodloss and waste• Piloting of new packaging
solutions, such as
packagelessRelevant KPIs
• Volume and organic revenue
growth• Customer feedback
from surveys• High merchandising
standards• Cooler coverage of highpotential outlets
Principal risks• Changing retail environment• Product quality andfood safety• Competing in the digitalmarketplace

Read more on pages 28-31

Material issues• Economic impact• Nutrition• Product quality• Responsible marketing
Growth pillars

Key challenges• Ensuring product safety andsupply• Continuously evolving our
products to meet consumers’
needs for healthy hydration,
quality, taste, innovationand convenience
How we engage• Together with The Coca-Cola
Company, we understandconsumers’ needs andpreferences through ouraccess to consumer insights• Consumers also provide
feedback on social media andvia consumer hotlines

Outcomes of engagement• We continued to evolve ourportfolio to address changing
consumer moments andinvested further in digital ande-commerce to meet new
shopper needs
Relevant KPIs
• Percentage reduction ofcalories per 100ml SSD• Number of consumer
complaints
Principal risks• Product quality and foodsafety• Product relevance andacceptability

Read more on pages 24-27

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Stakeholder engagement continued

Governments
Material issues• Climate change• Nutrition• Packaging and waste
management• Water stewardship
Growth pillar

Key challenges• Industry and/or productspecific policies, such as taxes,
restrictions or regulations• Environmental policies
How we engage• Much of our engagement withgovernments is conducted
at an industry level throughtrade associations• We partner with local
governments to tackle waste
collection challenges andwater availability

Our communities
Outcomes of engagement• In response to regulations
and levies on certain typesof plastic packaging, wehave lightweighted packages
and used more sustainable
materials• To address health andnutrition concerns, we
continue to add low- or
no-sugar drink options inevery market and provide
transparent nutritional
information
Relevant KPIs
• Percentage of absoluteemissions reduction• Percentage reduction ofcalories per 100ml SSD• Percentage of primary
packaging collected• Number of water stewardshipprojects in water priority
locations
Principal risks• Product-related taxes
and regulatory changes• Ethics and compliance

Read more on pages 45-53

Material issues• Climate change• Corporate citizenship• Economic impact• Packaging and waste
management• Water stewardship
Growth pillars

Key challenges• Climate change• Waste from our packaging• Water conservation• Empowering youth
and women
How we engage• We engage with customers
and partners to understandwhat skills and training
young adults need in
specific markets• Via our #YouthEmpowered
sessions we increase theemployability of young people• We participate actively tosupport the set-up andimplementation of new
packaging collection schemes• Addressing water challenges
in water priority locations

NGOs

Outcomes of engagement• Our support of new collection
schemes is translating into
increased collection rates
for packaging waste inmany markets• We have committed to
NetZeroby40 across theentire value chain• Water stewardshipcommunity projects in waterpriority locations
Relevant KPIs
• Number of young people
trained in our communities
through #YouthEmpowered• Percentage of absoluteemissions reduction• Number of water stewardshipprojects in water priority
locations• Percentage of primary
packaging collected• Number of volunteering hours• Number of and investments
in community projects
Principal risks• Geopolitical and security
environment• Cost and availability ofsustainable packaging• Managing our carbon
footprint• Water availability and usage

Read more on pages 45-53

Material issues• Climate change• Corporate citizenship• Human rights, diversity
and inclusion• Packaging and waste
management• Water stewardship• Food loss and waste
Growth pillar

Key challenges• Climate adaptation, movetowards net zero emissions
and water and energy use• Packaging waste• Sustainable sourcing• Partnerships with
communities and grassroots
organisations• Diversity and human rights
How we engage• We include NGOs andcommunity partners in ourleadership development
programmes, offering online
training for managing virtual
teams and leading in timesof crisis• We partner with specificNGOs for targeted
environmental and social
projects• We engage through ourannual Group Stakeholder
Forum and our annualmateriality assessment,
as well as through ad hoc
meetings
Outcomes of engagement• Percentage of participantsfrom NGOs in our first-time
manager programmes• Increased number ofcommunity projects for waste
reduction, water stewardshipand carbon removal
Relevant KPIs
• Number of and investments
in community projects
Principal risks• Cost and availability ofsustainable packaging• Managing our carbon
footprint• Suppliers and sustainablesourcing• Water availability and usage• Ethics and compliance

Read more on pages 45-53

17

18

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Stakeholder engagement continued

The Coca-Cola Company
Material issues• Nutrition• Responsible marketing• Sustainable sourcing• Corporate citizenship
Growth pillars

Key challenges• Support for consumers,
customers and communities• Profitable growth
opportunities• Value share in our markets• Sustainable sourcing
How we engage• Day-to-day interaction
as business partners, joint
projects, joint businessplanning, functional groups
on strategic issues and‘top-to-top’ senior
management forums

Outcomes of engagement• Our partnership added to thestrength and depth of our
24/7 portfolio, especiallythanks to the continued
roll-out of Costa coffee• We increased implementationof sustainable, ethicalpractices in our supply chain
through System-wide
collaboration
Relevant KPIs
• Revenue• Value share
Principal risks• Suppliers and sustainablesourcing• Strategic stakeholder
relationships

Our investors
Material issues• Economic impact• Climate change• Packaging and waste
management• Corporate governance
Growth pillars

Key challenges• Increasing focus on ESG and
ESG incentives• Maintaining focus on
long-term potential of theGroup rather than shortterm volatility
How we engage• Communication during our
Annual General Meetings,
investor roadshows, press
releases and results briefingsand ongoing dialogue withanalysts and investors

Our suppliers
Relevant KPIs
• Management access andpositive investor perceptionsof strategy• Total shareholder returnPrincipal risks• Cost and availability ofsustainable packaging• Changing retail environment• Commodity costs• Product-related taxes andregulatory changes• Foreign exchange
fluctuations• Managing our carbon
footprint• Geopolitical and security
environment• Suppliers and sustainablesourcing

Growth pillars

Key challenges• Rising costs of ingredients,
labour, packaging materials,
energy and water• Minimising the environmental
impact of water and energy
resources, as well as emissions• Traceability in the wholevalue chain, including Tier 2
and 3 suppliers for humanrights risk, biodiversity
How we engage• Feedback received
through our annual Group
Stakeholder Forum• Regular, ongoing interaction
with the Coca-Cola System’sCentral Procurement Groupand our technology andcommodity suppliers

Outcomes of engagement• Stepped up consultation
efforts and strengthened
two-way dialogue between
the Company and investors,
ensuring both goodunderstanding of long-term
Company strategy in themarkets and that investor
concerns are considered
in decision making• Issuing of our first green bondRead more on page 14

Material issues• Climate change• Sustainable sourcing• Water stewardship• Economic impact• Biodiversity

Read more on page 111

Outcomes of engagement• Our long-term work withpartners to reduce our waterand energy use has alsobrought efficiencies. This isparticularly important given
our NetZeroby40
commitment• Activities related tosustainable sourcing andcertifications
Relevant KPIs
• Percentage of key agriculturalingredients sustainably
certified• Percentage of our suppliers
adopting our Supplier Guiding
Principles
Principal risks• Cost and availability ofsustainable packaging• Water availability and usage• Commodity costs• Ethics and compliance• Managing our carbon
footprint

Read more on pages 32-35

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Market trends

Trends in our broad and diverse markets
Dynamic retail environment
In 2022, we saw strong category value growth resulting
from price increases and faster growth in single-serve packs.
Category volume increases were lower than in 2021, yet still
positive across most of our markets. As pandemic restrictions
eased in 2022, hotels, restaurants and cafes reopened andout-of-home consumption recovered. Online retailers anddiscounters also experienced strong growth.

Consumer environment
Cost of living is an important theme, with high inflation inessentials such as food, housing and energy, putting consumers’
disposable income under pressure. Despite the inflationary
environment, we have not seen significant changes in shopping
behaviour in most markets. Affordability remains a key theme,
yet we still see premiumisation opportunities as shoppers seek
quality and small treats despite budget pressure.

Digital evolution
The global trend towards digitisation, which surged during
the pandemic, continued to grow significantly in 2022
evidenced by 5G adoption, for example. Consumers havebecome much more comfortable and familiar with
e-commerce. Technology has advanced, and both convenienceand ease-of-use of online shopping have improved. Companies
are also increasing the use of digital tools to improve efficiency
of operations, customer service and marketing spend.

How we are responding

Delivered throughThis year we put more focus on improving our single-servemix and continued driving the shift from multi-serve packs tosingle-serve packs across all markets and in both the at-homeand out-of-home channels.

+3.5pp

To better understand and serve customers, we createdtargeted teams for hotels, restaurants and cafes, with support
from The Coca-Cola Company. We subsequently gainedor maintained market share in the majority of our markets in
2022 in the non-alcoholic ready-to-drink (NARTD) category,with notable gains in Sparkling.
We are very mindful of the demand for affordability in a periodof high inflation. To support category growth, we have focusedon smaller multi-serve offerings. This allows us to compete
at attractive price points for the consumer and penetrate
smaller baskets in a more profitable way.
Our ability to address consumer demand for premiumisation
was boosted by the acquisition of Three Cents super-premium
adult sparkling beverage and mixer products in 2022.

Our business-to-business (B2B) platform, Customer Portal,
is now deployed in all our markets and growing at a highdouble-digit rate in terms of customer numbers, orders andrevenue creation.
Our e-commerce platforms remained a strategic channel withrevenues tripling between 2020 and 2022. We are continuing tobuild our partnerships with all leading digital platforms.

We improved singleserve mix by 3.5
percentage points in
2022, driving positive
package mix andimproved revenue
per case+1.7pp
We gained or maintained
share in the majorityof our markets in the
sparkling category
and gained 1.7pp
of value share+77%
Revenue in the digitalcommerce channel
grew by 77% in 2022
compared with 2021,
excluding Russia andUkraineGrowth pillar

19

20

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Market trends continued

How we are responding

Sustainability
In 2022, corporate commitments to net zero targets increased
across all industries. At the same time, we saw growing scrutiny
regarding companies’ plans to deliver their net zero ambition.
Concerns about climate change, climate justice and energy
security are growing. Also, the focus on the need to movetowards a net positive world is increasing, with rising awarenessof the positive impact of biodiversity.
Our stakeholders, including consumers, expect businesses togenerate wealth, foster inclusion and diversity, respect humanrights across their entire value chain, support their communities
and take concrete action on important societal andenvironmental issues.

Regulatory environment
Regulation and regulatory frameworks continue to evolve
across our territories.
Sustainability remained in the spotlight through theimplementation of the EU Single-Use Plastics Directive andthe recent EU Commission proposal regarding plastic packaging
and packaging waste regulation, which have notable implications
for the beverage industry.
The new Corporate Sustainability Reporting Directive in the
EU is expected to broaden the scope of information disclosed
by businesses.

Following the announcement of our NetZeroby40 goal in 2021,
we built out our net zero transition plan and developed long-termclimate scenarios. We made new commitments in 2022,
pledging to achieve a net positive impact on biodiversity in
critical areas by 2040 and eliminate deforestation in our supply
chain by 2030.
We joined the Science Based Targets Network (SBTN)
Corporate Engagement Programme and we will work
to implement their guidelines in 2023.

Delivered through-21%
Absolute carbon
emissions in operations
were lower by 21%
in 2022 comparedwith 2017

We also issued our first green bond to support and further
advance our investments towards sustainability targets.
We are working to expand our partnerships and looking for new
collaboration networks, since we believe that ambitious goals
and commitments can only be achieved through collective action.
We are continuing to engage with regulators and governments
on more sustainable ways of doing business, as well as addressing
budgetary requirements whilst allowing for business growthand investment.
We are supporting Deposit Return Schemes and proactively
taking steps towards a more sustainable packaging mix.
We are investing in in-house rPET facilities, adopting
packageless and refillable packaging options and removing
plastics in secondary packaging.
We are committed to our Mission 2025 goals and are wellpositioned to address the environment and circularity ambitionof the European Union. We support the EU Commission’s Farm
to Fork objectives and the Code of Conduct on Responsible
Food Business and Marketing Practices.

48%
In 2022, we recovered
48% of the primary
packaging we putin the marketplace

Growth pillar

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Our purpose framework

Open up
moments
that refreshus allA new purpose
A purpose is a powerful force. It defines why
we exist. 2022 saw us develop our new purpose,‘Open up moments that refresh us all’.
As a bottler, our work requires sealing
refreshment in, but we believe that it is themoments that we open up that matter most.
Though our purpose is new, the optimistic spiritthat drives our work remains steadfast, and our
vision and strategy remain consistent. Our new
purpose further drives us to build on our Growth
Story towards 2025.
Our focus will therefore be to open up
opportunities for our customers and partners
and ensure we open up employees to their fullpotential, whilst opening up life to experiencesthat refresh and delight, and never losing sightof the opportunities to make a difference
as one Hellenic.

Our new purpose

Our vision is...

...delivered through ourstrategy…

In 1951, we began as a family-owned company
in Nigeria and have grown into the essential
partner that puts beloved brands into the handsof so many. Whether in our facilities, out on theroad, or alongside our customers, we bringrefreshment to life, 24/7.

...to be the Leading 24/7
Beverage Partner...

1

And as we drive impact through our values,
we open up new markets that grow businesses,
empower our people to reach their full potential,
help communities ﬂourish and work toward
a world without waste for everyone.
With each twist of a cap or pull of a tab, we open
up opportunities that delight everyone.
As one Hellenic, we open up momentsthat refresh us all.

Read more on page 11

Read more on pages 12-13

Leverage our unique
24/7 portfolio
2 Win in the marketplace
Fuel growth throughcompetitiveness andinvestment
4 Cultivate the potentialof our people
5 Earn our licence to operate
3

Read more on pages 23-53

21

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Our purpose framework continued... and enabled by our four values, which
define how we behave every day.

Achieving our strategy isreflected in remuneration…

The Management Incentive Plan (MIP) is basedon three metrics which are an outcome ofsuccessful progress towards Growth Story 2025:
revenue, comparable EBIT and free cash flow.

IT

Our Longer Term Incentive Plan (LTIP) balances
shareholder value creation with environmental
impact being based on ROIC, EPS and CO2
emission reductions across scope 1, 2 and 3.

LE
MP
SI

CUS
TO
M

ER

MAK
E

ST
R
I
F

...and flows into oursocio-economic contribution.

Our strategy and targets link directly to
executive remuneration.

PROCESSES

794,943

cumulative number of young
people trained in ourcommunities between
2017-2022

1 = 10job in the
SystemINSIDEDRIVE
IMPACTD E LI V

jobs in ourcommunity

323,727

ER

RI

indirect jobs acrossthe value chain

SU

ST
AI

€10.8bVE

OUTSIDE

22

NA

BLY

WE

O

created in added value acrossour value chain€589.5m

CapEx spend in our markets

PEOPLE

Read more on pages 128-155

Read more on pages 14-15

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Our strategy

Our growth pillars

1 Leverage ourunique 24/7 portfolio

How we are growing• Offer the best 24/7 beverage portfolio on theplanet together with The Coca-Cola Company
and other partners

Read more on pages 24-27

2 Win in themarketplace• Build unrivalled teams of true partners for ourcustomers, executing with excellence in every
channel for prioritised drinking moments• Fast-forward critical capabilities for growth
Read more on pages 28-31

3 Fuel growth throughcompetitiveness andinvestment• Transform, innovate and digitise our businessto ensure that we are fit for the future

Read more on pages 32-35

4 Cultivate the potentialof our people• Invest in building the best teams in the industry• Develop an inclusive growth culture around ourempowered people

Growth Story 2025
targets

5-6%
organic revenue
growth per annum,
on average

20‑40bps
comparable EBIT
margin growth
per annum,
on average

Employeeengagementscore greaterthan the global
top-decile norm

Read more on pages 38-42

5 Earn our licenceto operate• Be an environmental leader, engage ourcommunities behind water and waste initiatives,and empower youth, together with our partners

Read more on pages 45-53

Accomplish
Mission 2025
sustainability
commitments

23

24

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Growth pillar: Highlights in 2022

Sparkling
performance
We gained share across all brands, including
Trademark Coke, Fanta and Sprite.

Adult
Sparkling
continues to grow as a percentageof overall Sparkling, boosting
revenue per case.

Coffeeboostedby Costa: now in 8,000
out‑of‑home outlets.

Stills bounced
back
after the pandemic.

Energy energised
Proliferation of flavours and double-digit
revenue growth.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Leverage our unique 24/7 portfolio continued

KPIs• Organic revenue growth• Organic revenue per case growth• Volume growth

Principal risks• Competing in the digital marketplace• Product relevance and acceptability• Strategic stakeholder relationships

Stakeholders

Our customers

Our consumers

The Coca-Cola Company

Shareholders

Broad, unique portfolio delivered
continued growth
As we emerged from the global pandemic, the war
in Ukraine cast a large shadow emotionally andoperationally over us all. We delivered strong
performance in 2022 for our people and ourbusiness, despite the challenges we faced given
Ukraine and Russia are both Coca-Cola HBC
markets.
We remained focused and disciplined on
executing our growth strategy, with our broad andunique 24/7 portfolio combined with solid pack/price architecture and strong execution. Ourstrong partnerships with customers supported
our growth momentum and we continued
investing behind our strategic priorities
throughout the year.

Sparkling growth driven by consistent
strategic focus
Our sparkling portfolio remained resilient and wasonce again one of the best performing categories
across our markets in 2022. We grew share acrossTrademark Coke, Fanta and Sprite, driven bytargeted campaigns and activations.
Adult Sparkling continued to be a key driver ofpremiumisation with strong growth momentum.
Low- and no-sugar variants performed particularly
well, with organic volume growth ex Russia andUkraine up 14.3% compared with 2021.
We continued building on the well-establishedassociation of ‘Coke and Meals’ that resonateswith consumers, adds value to our customers andis the primary profit driver for Trademark Coke.
Coke and Meals was supported with dedicatedactivation plans across our markets throughout
the year, leveraging our unrivalled in-market
execution capabilities.

In 2022 we took a more strategic and holistic
approach to the consumption occasion of ‘breaks’– moments that create a positive mindset. We
further increased teen recruitment and solidified
value share for Trademark Coke, focusing on the
breaks occasion with screen time and music, withdedicated activation peaks throughout the year.
Trademark Coke also led our Christmas
activations, propelled by the focus, passion andcreativity of our people across our markets. We
succeeded in emotionally connecting with
consumers, while increasing value creation andpartnership with customers.
Organic volume growth for Adult Sparkling was up
9.5% (ex Russia and Ukraine) in 2022 comparedwith 2021, with growth across Schweppes andKinley. We expanded our footprint into thesuper-premium adult sparkling segment byacquiring artisanal mixer company, Three Cents,
which was founded by bartenders andentrepreneurs. Three Cents premium mixers aretargeted to mixologists and high-end hotel,
restaurant and cafe outlets. Artisanal mixers are
an attractive addition to our 24/7 product portfolio
as consumption shifts back to out-of-homechannels after the pandemic.
As inflation increased across our markets, we
flexed our offering by downsizing multi-serve
packs to address affordability concerns. We alsobrought forward premiumisation efforts, asconsumers looked for affordable treats. For
example, we engaged consumers in fun
Schweppes and Kinley ‘mixability’ experiences with
our premium spirits partners. These highlighted
opportunities to blend our portfolio and add value
across beverage categories.

The reopening of hotels, restaurants and cafes
was fundamental to our success during the year.
We continued delighting our consumers, driving
revenue through single-serve consumption andgenerating increased value for our customers.

Strong growth in still products2022 marked a good year for our Still category
across all business units. We delivered doubledigit revenue growth thanks to good momentum
and impactful execution, leveraging newcommunication campaigns and consumer
promotions to drive transactions of ready-todrink (RTD) tea and sport drinks. As a result, we
gained value share in both areas.
In Water, we stayed focused on execution, costleadership and selective expansion into highly
profitable emerging segments to deliver profitable
growth. Sustainability continues to be a key focus
of our water business. We introduced the firstlabel-free branded water packaging in Switzerland,
launching three label-free variants of Valser. The
distinctive look differentiates our products while
improving the ease of package recycling.
In RTD Tea, we delivered double-digit revenue
growth, boosting revenues with exciting
advertising campaigns, the acceleration of
zero-sugar flavours and strong in-store execution.
In Juice, we expanded our footprint in active
markets with our Cappy and Next Lemonades andadded interest with the new elderflower flavour.
Sport Drinks reported an exceptional performancedue to growing consumer demand and targeted
investments in priority markets. We had particularsuccess with Powerade in Italy, achieving andretaining our market share leadership position
during the year.

25

26

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Leverage our unique 24/7 portfolio continued
Energy is energised
Energy is one of the fastest growing categories of
non-alcoholic ready-to-drink (NARTD) products.
We continue to increase our market share as aresult of our well-defined strategy – offering acomplete brand portfolio, using disruptive
marketing platforms and offering a range offlavours to give consumers choice and entice
newcomers into the category.
We continued building our Monster portfolio by
growing Monster Ultra, a zero-sugar variant, andMonster Juiced. In Nigeria and Poland, we
achieved growth while addressing affordability
with Predator. Post-pandemic, we reignited the
support behind Burn, with very good results
attained in Hungary and the Baltics.
We continued our journey into the performance
drinks segment with our targeted brand, Reign.
Its popularity increased in our target markets of
Ireland and Poland, where our strategy of appointing
high-profile sporting brand ambassadors paid off.

Coffee grows as we expand our portfolio
Coffee continues to grow, primarily driven by
doubling our away-from-home outlets as well as
growing sales of beans, ground coffee and capsules
for at-home occasions.
Costa coffee continues to thrive, with a strong
presence in 16 of our markets after exiting Russia.
We were the first Coca-Cola bottler to pilot andlaunch the Costa proprietary capsule system forout-of-home occasions in 2022, with very
encouraging initial results. Poland is our biggest
Costa market both in terms of volume as well as
revenue, also benefiting from the growth in
e-commerce there.
Our distribution agreement with Caffè Vergnano
expands our 24/7 portfolio with a super-premium
coffee product for high-end hotels, restaurants
and cafes. Combined with Costa, this gives
us a total coffee portfolio for all customers andoccasions. Caffè Vergnano is now available in
14 of our markets.

Growth of coffee capabilities across our teams
remains a key focus. In 2022 we invested in our
Coffee Experts and Coffee Training Centres
network and launched our Coffee Academy,building on the success of our Sales Academy
development programme for Business Developers.
We also expanded our use of digital-enableddecision making, with over 75% of our professionalcoffee machines connected with telemetry. In fact,
most of our markets use our Data, Insights andAnalytics bespoke software for coffee-specificcustomer segmentation.

Premium Spirits in prime position
Premium Spirits benefited from developments in
consumer preferences and out-of-home channel
trends during the year. Revenue growth was driven
by our strategy of premium positioning, which
remains attractive as consumers seek affordable
treats despite inflationary pressures.
Brown-Forman, Edrington, Campari and Nemiroff
continue to be strong regional partners. In 2022
we formed an exciting new partnership with
Bacardi in Czech Republic and Hungary with a very
promising start.

Developing specialised capabilities is an importantpart of our success in this segment. To further
improve, we launched a Premium Spirits Academy
to train our dedicated teams. The capabilities
of more than 6,000 Business Developers will be
upskilled through this initiative over the next
two years.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Leverage our unique 24/7 portfolio continued
Taking action to improve
consumers’ health & nutrition

enable portion control and promote low- andno- calorie beverage options.

Ensuring fresh, quality products
and reducing waste

Understanding what our consumers want andneed is fundamental to our long-term success as
a 24/7 beverage company. Increasingly
consumers are interested in healthier options,
including reducing their sugar intake, while stillconsuming products that taste great.

As part of our Mission 2025 targets, we havecommitted to reduce calories per 100ml of
sparkling soft drinks by 25% between 2015 and2025 across all our markets. By the end of 2022,
we had achieved a 17% reduction. Through these
efforts, we are contributing to the European Soft
Drinks Association’s (UNESDA’s) target to reduce
added sugar in beverages by 10% by 2025 from a2019 baseline.

The rate of consumer complaints improved by
11% compared to 2021, even though consumer
preferences continue to evolve. Our efforts toimprove and modernise manufacturing processes
and our focus on product quality, safety andintegrity helped us achieve this reduction. We also
voluntarily took back products from the market on
four occasions, in Greece and Cyprus, Poland andRomania, and had one product recall from themarket in Italy during the year.

At Coca-Cola HBC, we are taking meaningfulactions to help people make informed choices. We
support the EU’s Farm to Fork goals for a healthy,
sustainable food system and, as part of the
Coca-Cola System, we follow the EU Code of
Conduct for Responsible Business and Marketing
Practices. The latter calls upon industry andretailers to reformulate products, encourage
portion control and market responsibly.
Our actions are aligned with our Coca-Cola
System partners and fall in five key areas:• less sugar, more choices• new and different drinks• informed decisions• no marketing targeting children• promoting low- and no-sugar choices
We have embraced the recommendations that
individuals should not consume more than 10% of
their total daily calories from added sugar. In
support of this, we continue to offer products
where we have changed recipes to reduce addedsugar, sell more beverages in smaller packages to

We are also committed to providing clear andtransparent nutrient information about our drinks,
such as the Guideline Daily Amount (GDA) labels
on our packages. We adhere to the policies of the
Coca-Cola System for global responsible
marketing, including the Global School Beverage
Policy and the Global Responsible Alcohol
Marketing Policy. We also adhere to UNESDA’s
pledges on Responsible Marketing.
We commit to not market directly to children
under 13 and do not offer any soft drinks inprimary schools. For 2022, relevant employees
and both direct and indirect distributors were once
again made aware of The Coca-Cola Company’s
Responsible Marketing Policies.
Looking ahead to 2023, we expect further
developments regarding front-of-pack nutritionallabelling and sweeteners. As part of the CocaCola System, we remain highly engaged with key
stakeholders through our participation inindustry associations.

To maintain awareness amongst our employees
and build their capabilities in quality and logistics,
we introduced a Supply Chain Academy. We also
marked World Food Safety Day in June and World
Quality Week in November.
We strive to minimise food loss and food waste in
our operations as this helps us preserve water andother natural resources, avoid carbon emissions
and mitigate the social and economic impacts ofagriculture.
In 2022 we committed to food loss and waste
goals, following our adoption of a new food loss
policy in 2021. Our target is to reduce absolute
food losses in dry matter by 30% by 2025, and by
40% by 2030 compared to our 2019 baseline.
These are absolute targets irrespective of volume
growth in our business. Unused beverages aretreated at either our own plant or external
wastewater treatment facilities. Liquid isreinstated after treatment to levels necessary tosupport aquatic life. Any remaining material issludge, or dry food loss, which is then used foralternative purposes such as composting for
agricultural needs or incineration for energy
recovery and biogas/biofuel. Our absolute amountof food loss from finished beverages was reduced
by 1% in 2022 compared to 2021.

Priorities in 2023
• Continue to deliver strategic priorities
of Sparkling, Energy and Coffee• Relentless focus on execution, growing
at-home and out-of-home occasions• Focus on pack architecture and price/
mix to balance affordability andpremiumisation• Capitalise on Energy, Coffee andPremium Spirits by increasing ourcapabilities through training• Continue to focus on reducing sugar
content in our beverages to meet our
Mission 2025 sustainability target

UN Sustainable
Development Goals

We serve our consumers with a broad rangeof high-quality products. In doing so, we
create value by contributing to global goals
for good health and wellbeing, innovation,
responsible production and consumption
as well as partnerships.

27

28

Strategic
ReportCorporate
Governance

Financial
Statements

Growth pillar: Highlights in 2022

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Implemented
price increases
and mix
initiatives
expanding revenue per case and mitigating
inflation, while driving market share gains.

Introduced new
Academies
including the Coffee Academy and Premium
Spirits Academy, driving our salesforce’s
capability to deliver improved service,performance and execution.

Next generationof segmented
execution
developed, including capabilities
to micro‑segment our customers.

Cooler coverage
extended to 86%
of top customer outlets.

Achievinghigher market
share online
by strengthening our relationshipwith e-retailers and developing
partnerships with new channels.

Updated data
and analytics
tools
and targeted training programmes
further supported revenue growth
management capabilities.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Win in the marketplace continued

KPIs• Organic revenue growth• Organic revenue per case growth• Organic volume growth• Value share

Principal risks• Commodity costs• Competing in the digital marketplace• Foreign exchange fluctuations• Geopolitical and security environment• Marketplace economic conditions• Suppliers and sustainable sourcing

Stakeholders

Our customers

Our consumers

The Coca-Cola Company

Shareholders

Winning in the marketplace throughtargeted investment in capabilities
Our ability to win in the marketplace has beenenhanced over the last few years with targeted
ambitious investment behind our prioritised
capabilities, including revenue growth management,route to market and data, insights and analytics.
Our customers range from global supermarket
brands and independent convenience stores,
to restaurants and e-retailers. Understanding
the needs of these different customers, andtheir relationship with consumers, is critical to
our success.
We are winning with both customers and shoppers
through our value-led approach to revenue
growth management, which proved critical in ayear of significant cost inflation. Our dynamic
route to market is expanding our coverage acrossall customers, complemented by our digitalcommerce strategy. Our investment in data has
built a market leading capability, which creates a
flywheel to enhance revenue growth management
and route to market, allowing us to segment themarket as never before.
These capabilities are critical for us to better
understand the real and changing needs of ourcustomers and consumers, drive profitable revenue
growth and anticipate or react to new challenges.
The power of our portfolio and consistentinvestment in our capabilities allowed us tobalance pricing and mix enhancements, while alsoachieving another year of strong share gains.

Revenue growth management
In 2022, we further built our revenue growth
management capabilities to navigate a challenging
inflationary environment. We have proactively
driven revenue per case through pricing and mix
actions and have focused on helping our customers
meet consumer demand for affordability as wellas premiumisation.

We continued to invest in capabilities,
implementing training programmes across different
layers of our organisation, and we drove further
integration with route to market and data,
insights and analytics.
We implemented price increases across all ourmarkets in 2022. Using updated data and analytics
tools allowed for better understanding of priceelasticities per brand and pack type, improving ourapproach to pricing decisions.
We are very mindful of the demand for affordability
in a period of high inflation. To support category
growth, we have focused on smaller multi-serve
offerings. We launched a 900ml bottle in
Switzerland and 1 litre in Slovakia. This allows us tocompete at attractive price points for the
consumer and penetrate smaller baskets in amore profitable way. To recruit new consumers,
we offer smaller, more attractively priced single
serve offerings, such as a 300ml PET Sparklingsize launched in Bulgaria. We also provide ourcustomers with affordable options through our
promotion strategy, where we have been using
advanced analytics to maximise benefit for ourcustomers and return on investment.
Despite higher inflation, we do see demand forhigher-value, premium beverages. We saw growthin our Adult sparkling business, particularly in the
hotels, restaurants and café channel, while also
leveraging the growth of socialising at-homeoccasions in the at-home channel. We expanded
our pack offerings in Adult sparkling, with thelaunch of a 330ml can of Kinley in Austria, and a 1
litre PET of Schweppes in Romania. Another driverof premiumisation is the growth of glass packages,
and we expanded our 1 litre returnable glass
bottles in Austria to zero-sugar variants.
We drove greater sales across our markets in
2022 by focusing on multi-packs of single serves.
This helped us improve our single-serve mix in theat-home channel, with single-serve volumes
growing 10% in 2022, 25% above pre-pandemic
levels in 2019.

Partnering with customers to drive value
We know that our success is dependent on the
success of our customers. We achieved improvedalignment with our customers with joint businessplanning and strategic planning workshops andinvited our customers to share their perspectives
with our people. We have also worked withcustomers on our sustainability programmes,
such as the launch of the 100% rPET portfolio
in Switzerland.
As pandemic restrictions eased in 2022, we
worked closely with our out-of-home channel
customers and saw successful execution tocapture the full potential of reopening in ourmarkets, particularly ahead of and during thesummer season. We saw the hotel, restaurant andcafé channel grow organic revenues strongly inthe year (excluding Russia and Ukraine). In 2022,
we created targeted teams for this channel,
with support from The Coca-Cola Company, toaccelerate performance by better understanding
customer needs.
We complemented this with a continued focus onopportunities in the at-home channel, leveraging
the strength of our portfolio with strong marketing
campaigns and execution. Our work is paying
off and we are creating value for our customers.
According to data from Nielsen, once again, in 2022,
we were the number one contributor to revenue
growth in FMCG across our retail customers.
We are committed to improving our customer
experience. When a customer has an issue, wetarget a 48-hour response time, and empower oursalespeople to ‘close the loop’ and resolve issues
immediately. We now collect ongoing feedback
from over 40% our customers through Customer
Gauge as we value feedback from all customers,
and we want to make their experience with us
even better tomorrow. We now consider Net
Promoter Score® an important metric to measurecustomer satisfaction and we’re encouraged
by early progress. This is directly connected todriving revenue growth.

29

30

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Win in the marketplace continued
Our digitally enabled route to market

Accelerating digital commerceWith the reopening of markets through thefirst part of the year we benefited from a flexible
route to market, which allowed us to maximise
opportunities and drive joint value withour customers.

In 2022, we continued to invest in and develop oursuite of digital commerce platforms and solutions
to serve the growing numbers of consumers andcustomers choosing to shop online. We havestrengthened our online capabilities across thebusiness, as well as developed new tools that areallowing us to drive our online business in more
efficient and data-focused ways.

In 2022, we further improved our route to market
with enhanced digital tools and data capabilities.
These allow for a more granular segmentation of
our customer base and more targeted services.
As a result, we improved both our physical anddigital coverage of customers during the year,
and drove stronger execution.
We continued to drive our market leadership
through increased market execution in displays
and the placement of digitally connected coolers.
We also enhanced our execution capabilities by
the expansion of image recognition into 26
markets, up from eight in 2021.
We continued to invest in new coolers as they help
to drive single-serve mix and revenue growth. We
have focused on using data to increase our
profitable cooler coverage. We reached 86%
coverage of our top customer outlets, up 2.8pp
organically compared to 2021 (excluding Russia &Ukraine). We have a total of 1.33 million coolers on
customer premises, and, excluding Russia &Ukraine, 53% of these now have online
connections, up nearly 4 percentage points
organically year-on-year. This bolsters theefficiency of our assets and increases the
productivity of our sales teams.
In 2022 we also piloted a next generation
customer relationship management system,
another example of our ongoing digitaltransformation. Providing a digital tool forcommunication drives better service and allows
our salespeople to spend more time with ourcustomers. We plan to scale the platform acrossall markets in 2023.

Customer Portal is our business-to-business(B2B) platform, an omnichannel service tool forour customers that delivers incremental revenue
growth. The share of total customer orders placed
online was 4% in 2022, a reduction compared to2021, due to the negative impact from Russia.

Excluding Russia and Ukraine, we saw good growthin the number of customers, orders and revenue
delivered, with the number of customers andorders close to doubling year-on-year. If weconsider small individual non-chain stores only,
20% of all the orders from the channel camethrough our Customer Portal. We have seen astandout performance from Czech Republic andSlovakia, where we reached 34% of total orders
placed on Customer Portal in December 2022.

We are pleased to have seen a positive initial
response to the platform and are planning an
expanded roll out in 2023.

In Q3 2022 we launched SIRVIS in Italy, our B2B
marketplace for the out-of-home channel,
offering a 24/7 multi-category orderingexperience, as well as a range of services.

In e-retail, we increased our digital shelf space andvisibility. With food delivery platforms, we achieved
a beverage attachment rate of 25%, increasing
9pp year-on-year.

When it comes to route-to-consumer, we arepartnering with e-retailers and food delivery
platforms to create unique omnichannel
experiences for our shoppers and drive profitable
growth. Our revenue in the channel expanded
by 59% vs 2022, a third consecutive year of
growth acceleration.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Win in the marketplace continued
execution. It is now live in 10 markets as of the endof 2022, with further roll outs planned for 2023.
In 2022, we leveraged AI and advanced analytics
algorithms to accelerate the transformation of our
promotion management and demand forecasting.
By using advanced analytics algorithms, ourmarkets can evaluate promotion spend
effectiveness, improving allocation of investmentin promotions which drive higher-return
opportunities and increase joint value created withour customers. AI-enabled forecasting for shortand long-term demand also streamlines inventory
management, preventing out-of-stock incidents,
and improvement in demand planning.
Finally, as we accelerate our journey to become adata-driven organisation, we are building thecapabilities of our people. We launched the Data
and Analytics Academy during the year to support
capability building of our employees across allfunctions and further accelerate the culture ofdata driven decision making.

Quick commerce, where it takes a maximum of 30
minutes for home delivery, is another fast-growing
sub-channel in urban areas where we arepartnering with multiple players. In 2023, we willcontinue to invest to improve our ability to serve
online shoppers.
Within the direct-to-consumer (D2C) channel,
we are experimenting with different models in
different markets and implementing data-driven
commercial strategies. For example, in Switzerland,
we launched Qwell Express, a quick beverage andsnack delivery platform. In 2023, we will continue
growing our existing D2C businesses and learning
about new models.

Data, insights and analytics
We made further progress leveraging data,
insights and analytics capabilities to strengthen
our revenue growth management and route tomarket, continuing to scale the capabilities
required to drive a competitive advantage.
Segmented execution is where we use ourcapabilities to identify customer needs in different
locations and distinct types of outlets to bettertarget product assortment and personalisemarketing activities. We developed the next
generation of segmented execution, including
improved micro segmentation of our customers,
leveraging rich and granular external data. With
micro segmentation we can identify outlets foraccelerating certain packs and products. For thelaunch of the 300ml PET bottle in Bulgaria, weused micro segmentation to target outlets which
had higher-than-average traffic and a younger
demographic. The next generation of segmented
execution uses AI-enabled algorithms to help
predict the potential value of an outlet and eachproduct category, to drive targeted and focused

Driving stronger capabilities acrossour salesforce
To deliver our strategy, our people need the righttools to address customer needs. We now haveseven types of Sales Academies across different
sales roles, in all of our markets. These aim to build
unrivalled sales teams that constantly strive toimprove our service and drive value with and forour customers.
The academies offer a comprehensive end-toend developmental experience, and we areconstantly updating the programmes, keeping thecurriculum current with relevant market insights.
We had tremendous uptake in 2022, with 98% of
the Business Developers that took part achieving
certification through completion of the
programme. We also launched two newacademies during the year, designed to growcapabilities in Coffee and Premium Spirits.

Priorities in 2023
• Continue to execute our revenue
growth strategies to drive both priceand mix acceleration, while addressing
consumer needs for affordability as wellas premiumisation• We will further drive usage of insightsfrom segmented execution and increase
promotion spend effectiveness toaccelerate value delivery• Continue to invest to improve ourdigital commerce abilities and respondto rapid growth• Improve our coverage of dynamic
route-to-market solutions, supportedby the deployment of image recognition
in all markets and an acceleration in
the increase of coverage by
connected coolers

UN Sustainable
Development Goals

As we build our business by helping ourcustomers to grow and thrive, we makesubstantial contributions to the achievementof the Sustainable Development Goals related
to ending poverty, decent work, sustainablecommunities, responsible production, justiceand strong institutions, as well as partnerships.

31

32

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Growth pillar: Highlights in 2022

Industry 4.0 in
supply chain
by scaling ‘vision picking’ so that it covers
more than 45% of Company picking
volume, continuing to deploy automatedyard management in addition to real-timetransport visibility.

Deploying imagerecognition
technology
leading to improved market execution by
activating image recognition in 24 of ourmarkets, covering 265,000 outlets.

Supporting ourcustomers
with the implementation of the new customer
relationship management platform, which
delivered increased customer retention
and satisfaction.

Increasingcoolers in themarketby placing 99,000 new coolers in 2022.

Reducing
secondarypackaging
and CO2 emissions through our
packaging optimisation initiatives.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Fuel growth through competitiveness and investment continued

KPIs• Organic EBIT growth• Comparable EBIT
• Comparable EBIT margin• Capital Expenditure as % of NSR• ROICPrincipal risks• Competing in the digital marketplace• Cost and availability of sustainable
packaging• Cyber incidents• Managing our carbon footprint• Water availability and usage

Stakeholders

Our customers

Shareholders

Our suppliers

In a challenging year with significant inflationarypressures across our business and supply chain,
we continued to invest to support long-term
growth. In the face of macroeconomic uncertainty
and geopolitical turmoil, our business remained
resilient. We maintained supply and had no
disruption in our production, except for a brief
shut-down in Ukraine, when our plant outside Kyiv
was temporarily in occupied territory. We also
continued expanding our use of new technologicaltools to improve efficiencies and reduce costs.

Supporting profitable growth
We continue investing in new and upgradedproduction lines to support our revenue growth
management initiatives and the growth of key
categories in our product portfolio.
In Austria, we invested in a refillable glass bottleline to support the production of our 1 litre and
400 ml sparkling proposition. This investment
secures supply of refillable glass bottles andenables growth in sustainable packaging, helping
us respond to market trends.
Energy is one of the fastest growing categories in
non-alcoholic, ready-to-drink beverages. To meetdemand, we are investing in new, dedicated canlines and syrup capability for Monster products at
our plants. By increasing in-house production wecan better satisfy growing demand for Monster
products and also create a more efficient supply
chain in our countries. We currently produce
Monster products in five countries and six
production lines, with plans to expand further with
two additional lines in 2023.
The growth of our single-serve packages is a key
strategic focus of our revenue growth
management strategy. In this context we
continued our investment in coolers, with 99,000
new coolers in our markets, to provide further
support for single-serve growth.

Our newest coolers are connected online toprovide better service to our customers and abetter shopping experience for consumers,
boosting brand recognition and market
penetration. They are also energy-efficient,
reducing emissions in our value chain.
Following our acquisition of the Coca-Cola
Bottling Company of Egypt, with five production
plants and a new mineral water plant in Serbia, wehave now 62 production plants, compared with 56
at the end of 2021. To reduce our costs formaintenance and energy and limit production
downtime, we expanded our use of digitalproduction and predictive maintenance systems
to twelve additional markets by the end of 2022.

Leveraging digital and technology
In 2022, we continued investing in effective digital
tools and technology solutions, and expanded ourcapabilities focusing on customer and consumercentricity, employee experience as well as
operational productivity.
To improve market execution, we fully activatedour in-store image recognition technology in 24
countries, with 265,000 outlets covered. We areprocessing over 1.7 million product execution
images every month, continuing to free up
salespeople to spend more time with customers
and improving revenue per outlet.
We continued our efforts behind a technologyenabled route to market by further implementing
business analytics tools to support segmented
execution. Using extensive internal and external
data to generate outlet-specific suggested orders
and recommended activities, we have improved
the order-taking process and execution.
Further benefits have been achieved through thepilot of an online customer relationshipmanagement platform leading to faster and more
flexible customer interactions and greater
customer satisfaction.

During 2022, we upgraded our talent acquisition
digital capabilities by consolidating sourcing,
candidate relationship management, selection
and applicant tracking under the Avature Platform,
with an aim to access a wider set of candidates,
optimise the hiring process and improve speedof recruiting and candidate experience.
New digital tools are improving operational
productivity and helping us serve customers ina more cost-effective way with better monitoringof insights and data. We introduced a range ofsolutions for digital transformation across manydifferent business areas during the year, including
planning, manufacturing and supply chain using
Industry 4.0 principles. We developed a ‘digitaltwin’ of our Austrian physical manufacturing plantin the industrial metaverse. This pilot digital twin
project led to a 9% reduction of energy usage
and a reduction of CO2 emissions in the piloted
production line.
To identify opportunities for simplification, in
2022 we invested in process mining, using artificial
intelligence to map core processes. Combining
the analysis with process expertise, we have now
defined priority areas where technology will be
used to simplify and standardise for greater
efficiency. For more information on oursimplification drive, Project Oxygen, see page 39.
During the year we also continued to enhance andstrengthen reporting and analytics capabilities,
democratising data access using cloud technology
and enhancing data insights with cross-functional
management reporting. Business data combinedwith purchased data helps us leverage artificial
intelligence, improving segmented execution,
demand forecasting and product performance.
As our business continues to grow, we haveintegrated technology to a common standard setof solutions. This simplifies technology integrationas our Company expands, adding operations
in a new market, Egypt, and Three Cents adultsparkling in 2022. Technology integration is donein a phased manner, and is continuing into 2023.

33

34

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Fuel growth through competitiveness and investment continued
Embedding sustainability
Sustainability is at the core of all our sourcing
activities and our suppliers are critical partners in
improving our impact. We monitor the performanceof our critical suppliers through our internal supply
base assessments, audits of compliance and the
EcoVadis platform. EcoVadis helps us monitor arange of risks using 21 criteria from international
standard setters including the UN Global Compact,
ISO 26000, the Global Reporting Initiative (GRI)
and the International Labour Organization.
In 2021, we revised our procurement assessment
guidelines to implement stricter rules for supplier
practices in regard to human rights, ethics andcompliance practices. We also re-trained ourbuyers on the sustainability risk assessment tools
available for supplier selection and governance.
This training was repeated in 2022, and rolled out
in Egypt, our newest market.
In 2022, over 1,400 of our critical suppliers wereassessed using EcoVadis, an increase of 27%
versus 2021. Our plan is to expand the use of
these assessments for better, more objective
supplier monitoring and to leverage our EcoVadis
partnership across the Coca-Cola System toexchange intelligence. We are also investigating
how to further extend the assessment of the risks
in our supply base, leveraging new tools, artificial
intelligence and customised alerts.
We recognise supplier certifications as perinternational standards including ISO 9001, ISO
14001, ISO 50001, FSSC 22000 and ISO 45001.
For agricultural commodities, we are aligning withthe wider industry to recognise the Rainforest
Alliance, Fair Trade, Bonsucro and the Sustainable
Agriculture Initiative Platform (SAI- FSA) andGlobal GAP+GRASP. Through our workplaceaccountability audits, which have a three-year
audit cycle, all long-term contractors andcontracted services on-site are assessed inregard to human rights.

To achieve our NetZeroby40 commitment
to reduce our emissions, together with the
Coca‑Cola System, we are engaging with ourmost critical suppliers to tackle emissions in our
supply chain. This involves support for measuringgreenhouse gas emissions and prompting public
disclosure through CDP and development of
suppliers’ own commitments to science-basedtargets. We have teamed up with a reputablespecialist consultancy to develop a methodology
for capturing emissions data and calculating
Supplier-Specific Emissions Factors (SSEFs).
Through these efforts, we are helping our
suppliers build a strong foundation to start
reducing greenhouse gas emissions. In Greeceand Poland, we piloted workshops with key
suppliers, exchanging views on sustainability andexploring how we can work together to achieve
emissions reduction and net zero.

Packaging and transport
Improving the sustainability of our packaging is
one of our Mission 2025 sustainability objectives.
To deliver on this, we undertook a number oftargeted sustainability initiatives in 2022. These
helped us to secure supplies of rPET and reducepackaging size and weight. We also took further
steps in our Green Fleet initiative, reducing theimpact of our fleet vehicles.
We expanded our ability to produce rPET in-house,
with a €30 million investment for a dedicated facility
in Gaglianico, Italy. It has the capacity to transform
up to 30,000 tonnes of PET per year into new
100% rPET preforms, enough to meet ourbeverage bottling needs in the country.
You can read more about this in a casestudy on page 51.

“We expanded our ability to produce rPET
in-house, with a €30 million investment fora dedicated facility in Gaglianico, Italy.”Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Fuel growth through competitiveness and investment continued“Improving the sustainability of our
packaging is one of our Mission 2025
objectives which also contributes toemissions reduction. To deliver on this,we undertook a number of targetedsustainability initiatives in 2022.”

In Switzerland, we began using 100% rPET for all
locally produced products. Italy and Austria alsobegan transitioning their locally produced PET
portfolios* to 100% rPET in Q4 2022. These steps
reduce our annual use of virgin PET by approximately
20,000 tonnes. We will reduce our use of PET byanother 127 tonnes annually after lightweighting
the preforms used for products in Cyprus.
Our cans are among the lightest in the market and,within the Coca-Cola System, we have alreadygained benchmark status for can-weight
optimisations. BALL, a strategic partner that
supplies over 25% of our total can volume, began
using renewable electricity for all of cans supplied
to Coca-Cola HBC in Europe, reducing emissions
by more than 9,000 metric tonnes annually.
Also with BALL’s support, we further lightweighted
our 25cl aluminium cans, cutting another 370
metric tonnes of CO2 emissions per year.
We made progress in reducing secondary
packaging in a number of markets during the year.
In Poland, we piloted a new stretch film, reducing
the amount of plastic needed annually by 35
tonnes, with a subsequent 73-tonne reduction
in CO2 emissions. Coca-Cola HBC Polska wasrecognised for this implementation, receiving
the Golden Innovation Retail 2022 award. Further
roll-out of this innovation is planned in 2023.
We also took steps to optimise our shrink plastic
film for packaging in Austria, Czech Republic,
Ireland and Switzerland. Our efforts in thesemarkets reduced CO2 emissions by 238 tonnes,
reducing also the related use of plastic materials.
We are working diligently towards fulfilling therequirements of the EU’s Single-Use Plastics
Directive. In 2022, we began introducing tetheredclosures, which help capture the entire package
for recycling. In Greece, we introduced tetheredclosures for our aseptic fibre packages, along withplant-based packaging materials, reducing CO2
emissions by 1,028 tonnes annually.
* Excluding water in Italy.

In Italy, we introduced tethered closures foraseptic packaging, used for AdeZ products forexample, and sparkling products. In Bulgaria, wehave done the same for our local water brands. In
2023, we will implement tethered closures formore products, in more markets. In conjunction
with our customers, we are also evaluating
alternatives to replace plastic drink lids withsustainable materials such as paper in advance of
new requirements in the EU.
We also targeted reduction of plastic used in labels
by reducing label size. An initiative to optimiselabel height was rolled out at the end of 2022 forcore sparkling brands in four pilot markets: Cyprus,
Greece, Italy and Poland. This will be rolled out
across the Group in 2023. We aim to reduce
costs while also decreasing annually our plastic
use by 120 tonnes, and related CO2 emissions
by 300 tonnes.
We have also optimised our use of cardboard. As
an example, Czech Republic optimised the weightof corrugated cardboard trays by 32%, saving 112
tonnes of paper raw materials. Implementation of
our Keel Clip™, which replaces plastic film on can
multipacks with an innovative paperboard solution
was extended during the year. In Greece, Keel
Clip™ use was expanded to an additional
production line and in Hungary, Keel Clip™ wasintroduced in 2022.
We also continued rolling out our Green Fleet
programme to achieve progress against our 2030
CO2 emissions reduction roadmap. This
programme is centred on transitioning our fleet toelectric and more sustainable vehicles. In 2022 wereduced our carbon footprint compared to ourbaseline (2017) by 39%, which is a reduction of
about 40,000 tonnes of CO2 in comparison to thebaseline. In addition, we introduced 1,157 green
new vehicles in 2022, which now comprise 28% of
our total light fleet, compared to 16% in 2021.

Priorities in 2023
• Continue to invest in new modernised
production lines to support the growthof the business• Expand in-house production of Monster
products with additional productionlines in our plants• Scaling of our new customer
relationship management platform
across our countries to further support
customer interaction and satisfaction• Continue Egypt’s integration in oursystems and implementation of SAP’s
S/4HANA in the country• Further improving sustainability of our
packaging by even greater reduction ofplastic used and CO2 emissions

UN Sustainable
Development Goals

Our sustained efforts to reduce our costs andimprove our impact have generated significant
results for our business, our communities, society
and the environment. These results correspondto contributions to the Sustainable Development
Goals for clean water and sanitation, clean
energy, economic growth, industry innovation,
sustainable communities, responsible production,
climate action, life below water and life on land.

35

36

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Feature: Focus on Egypt

Introducing
our newest
marketEgypt joined our Group in January2022 after the acquisition of
the Coca-Cola Bottling Companyof Egypt (CCBCE), and we arevery excited to welcome our
new colleagues.
Egypt has a young population of over 100 million
and is one of the largest non-alcoholic readyto‑drink, (NARTD) markets by volume in Africa.
We are building on our existing scale in Africa
and increasing our exposure to high-growthgeographies. Egypt is one of the few countries
where Coca-Cola does not have leading market
share, and we see great potential for us to unlock
considerable opportunities in this territory.

Increasing brand portfolio
Our current portfolio in Egypt spans oursparkling range: Trademark Coke, Coke Zero,
Sprite, Fanta, Schweppes, Canada Dry andWater, including several variants of Dasani water.
We see significant opportunity to leverage ourproven route-to-market capabilities and over
70 years of experience in emerging markets toincrease penetration of The Coca-Cola Company’s
brand portfolio, driving category leadership.

Young and growing population

100m+

Opportunity to increase
per-capita consumption
Opportunity to becomemarket leader

Coca-Cola HBC Integrated Annual Report 2022

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Feature: Focus on Egypt continued

Collection and recycling“Our integration journey has started andI’m particularly proud of how we’ve already
improved our execution capabilities,
with better route-to-market and businessanalytics. At the same time, our expertisein operating in a high-growth market has been
welcomed in Coca-Cola HBC. My colleagues
and I are excited about 2023 and theopportunities we can develop as part of
Coca-Cola HBC.”
Ahmed Elafifi
General Manager

Sustainability
The team in Egypt has a forward-looking
attitude to sustainability, for example, installingin partnership with a supplier via a powerpurchase agreement (PPA), 4.5 megawatt
solar photovoltaic rooftop plants at four
manufacturing sites. We believe this is an
example of how our values are aligned.
The business is committed to contributing to theGroup’s Mission 2025 sustainability targets and
NetZeroby40 commitment and has started toalign initiatives accordingly. We plan to include
Egypt in our sustainability reporting from 2023.

Integration is progressing according
to plan
We are implementing our execution capabilities,
focusing on revenue growth management.
Back-office integration is on track, enabling costsynergies in central functions.

We are strengthening the cooler network andhave invested in the market by installing newenergy-efficient coolers this year in highpotential outlets and locations, thus expanding
the reach of our portfolio.
We also integrated HR processes, including
performance evaluations, selection tools andtalent development, while respecting local
cultural imperatives.

Market share improves in 2022
We are encouraged to see early signs ofsuccess from the investments we are making
to strengthen long-term opportunities in Egypt.
In 2022 Egypt arrested the market share loss
they had seen for several years. We’re proud ofthese achievements and excited for what the
future can bring.

Through our partnership with BariQ, thelargest “bottle-to-bottle” recycler andproducer of rPET pellets in the Middle East,
we support the collection and recycling of
PET bottles in Egypt. In 2022, more than
31,000 tonnes of PET bottles were collected
for recycling by BariQ, delivering a packaging
collection rate of 43% for Coca-Cola HBC
Egypt. Through this ongoing partnership,
we continue to support collection andhigh-quality recycling in the region.

Water stewardship
Egypt has a growing population and is almost
entirely dependent on the Nile River forwater, which is a scarce resource. We arecommitted to reducing our water usage ratio
and working with communities to help securewater availability in water risk areas.
In the two water priority locations in Egypt(Assiout and Kaliub), with the funds of
The Coca-Cola Foundation and partneringwith the UNDP and local NGOs, we
implemented several water stewardshipprojects that replenished 3.6 billion litresof water. The interventions include riverbank
filtration unit construction; improvementof soils, yields and irrigation demand throughcomposting and use of a greenhousecultivation model in marginal and submarginal lands with a hydroponic system.
One of the projects also provided water
access in 17 villages where more than 33,000
people were beneficiaries.

37

38

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Growth pillar: Highlights in 2022

Continued tolisten closely to
our people
and act on their feedback, simplifying
processes and investing in capabilities
necessary to achieve our Growth Story
2025 targets.

Continued ourefforts to build
an inclusive
workplaceand a diverse workforce that reflects ourcustomer base and communities.

Kept ourpeople safe
during turbulent geopolitical events.

Helped ourcustomers andour people
adapt to the changing external
environment with speed and agility
through new ways of working.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Cultivate the potential of our people continued
Strengthening our culture andsupporting our people

KPIs• Employee engagement• Percentage of managers that are
women• Lost time accident rate

Principal risks• Health and safety• People retention• Geopolitical and security environment

Stakeholders

Our people

From the first days of the war, we have worked toprotect our people. We provided advance salary
payments when necessary, and re-skilling andredeployment options. We ensured that medical
and life insurance programmes in Ukraine wereoperating and provided high levels of support
and offered targeted mental health assistance.
For an overview of our efforts to support ourpeople and critically vulnerable populations in
Ukraine, see page 43.
To simplify processes and make our people’s lives
easier, we have introduced a new, refined purpose,
which highlights the value we create for all of our
stakeholders: open up moments that refresh us
all. To support the roll-out of this refined purpose,a new culture manifesto is being introduced, alongwith a new leadership model. These will be rolled
out across the organisation throughout 2023.
These efforts align with ongoing efforts to simplify
and transform our business, Project Oxygen and
Project Dolphin.
A highlight of 2022 was welcoming Egypt into ourGroup. We integrated our HR processes, startingwith HR reporting, performance evaluation,
selection tools and talent development, while
respecting local cultural imperatives. In parallel,
we started an internal talent exchange programmethat gives our people the opportunity to pursue
developmental assignments across our markets.

Designing a future-ready organisation
To achieve our Growth Story 2025 strategy and to
future-proof our journey, we have taken a hardlook at how we are organised and how we work.
A Group-wide initiative launched in 2022, Project
Oxygen aims to reduce bureaucracy, simplify ourprocesses and allow more time for value-adding
tasks. We have identified the most critical pain
points for our employees, prioritised them andsecured investment behind the most impactful
ones. We have developed a clear and sequenced

plan to remove complexity, drive processsimplification and ensure a much better employee
experience in those key moments.
We implemented a Group-wide organisational
structure redesign, Project Dolphin, withconsistent but modular functional frameworks.
This ensures we have a consistent structure withsome local modification when needed to best
serve customers locally, while prioritising thecapabilities critical for future growth.
To fuel our agility and ensure success in criticalareas, we introduced a new, dynamic structure
called Dynamic Pods. These cross-functional
teams are completely dedicated to criticalbusiness missions to enhance speed, quality andfocus. In 2022, we deployed 10 Dynamic Pods
focused on business acceleration in the hotel,
restaurant and café channel and trade investment
optimisation. We plan to introduce more in 2023,
with some focused on specific markets.

Targeted improvements in engagement
As the fast pace of change continues, we madepulse surveys a permanent part of our internal
communications. This helps ensure thatmanagement and the Board really understandwhat our people need to succeed.
We conducted two all-employee surveys in 2022.
The Company’s Employee Engagement Indexscore, the outcome of our annual engagement
survey conducted in October 2022, remained
steady at 85% with 88% of the workforce
participating. We continue to benchmark our
employee engagement against other highperforming companies, partnering with Qualtrics.
Our 2022 results were three percentage points
below the Qualtrics Global Top Decile Norm, which
represents the top 10% of more than 15 million
people from more than 350 companies.

39

40

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Cultivate the potential of our people continued
Our 2022 employee engagement results highlightprogress in areas of focus since the 2021 survey.
Both willingness to help each other and managers
helping prioritise work increased by one
percentage point to 89% and 86%, respectively,
compared with 2021. We have invested in our
Business Developers, a key segment of ourworkforce, and survey results found a significant
increase in their perception of having theequipment and resources required. This metricincreased five percentage points to 86%
compared with the prior year. We have also
adapted their pay, a key driver of retention. In 2022,
62% of our Business Developers reported feelingfairly paid, an increase of three percentage points
compared with 2021.
Retention is also a key priority, supported byan ongoing exit survey, continued focus on
remuneration and plans to introduce stay
conversations. Overall turnover was 11.4% in
2022 compared with 13.1% in 2021, showing asignificant improvement due to our conscious
efforts. As retention rates for women were lower,
we conducted focus groups to better understandthe root causes, and subsequently introduced
relevant action plans. By year end, retention rates
amongst women had stabilised in key markets.

Health, safety and wellbeing
We have focused on reducing road accidents
for many years, and our 16.3% improvement inaccidents per million kilometres travelled in 2022
was our tenth consecutive year of improvement.
We established dedicated routines and corrective
actions for our markets with higher road traffic
incidents, Nigeria and Egypt, in 2022. We also
introduced our first virtual training simulator in
Nigeria to train employees and contracted
partners who operate forklifts and drive trucks.
These new initiatives build on our fleet safety
training, which blends classroom and on-the-roadelements, and our installation of collision
avoidance technology in fleet vehicles.

Regrettably, for the first time in five years, one of
our employees died in a work-related road accident
in 2022. In addition, seven contractors had fatal
incidents, mainly road accidents. This comparesto three contractor fatalities in 2021. All of thesereported fatalities were followed by investigation
and root-cause analysis. Appropriate corrective
action were defined and relevant lessons learnedin each case, which have also been sharedacross our markets.
Overall, our Lost Time Accident Rate increased to0.35 for 2022 compared with 0.25 in the prior year,
primarily due to falls/slips/trips, road accidents
and contact with machinery and tools. In order toreverse this trend and stay on track towards
our 2025 commitment, we are closely working
with the leadership teams of selected business
units with the highest Lost Time Accident Rate.
We are also putting strong focus on refreshing
their behaviour-based safety programmes andstrengthening the safety culture of our employees.
Aiming to create a proactive safety culture, ourrefreshed behaviour-based safety programme
has been implemented in all our business units
excluding Egypt. All of our manufacturing facilities,
and all of our commercial territories excluding
Nigeria, are covered by the programme.
In 2022, we expanded it to Group offices,achieving
52% coverage. We have eliminated 84.7% of thebarriers to safety identified and have trained 9,219
employees and 1,229 contractors as behaviourbased safety observers supporting the programme.
We plan to deploy this programme in Egypt in 2023.
To maintain engagement around health andsafety, we conducted three communication
campaigns across the Group in 2022. We also
expanded our quarterly assessment ofcompliance with The Coca-Cola Company’s
Life-Saving Rules from manufacturing to include
all non-manufacturing locations, achieving a final
assessment score in the fourth quarter of 2022
of 81.2% (excluding Russia), vs 62.5% reported
in 2021 (including Russia).

Accidents per million kilometres (APMK) trend
10
8.93
8
7.64
6
5.4

4.96

4

4.22

3.92

3.66
2.63

2

0

2012

2013

2014

2015

2016

2017

2018

2019

2.20

2.02

2020

2021

1.69
2022

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Cultivate the potential of our people continued
Trust and belonging as a foundationof our culture

We view mental health as an important part of
employee wellness and are equipping our people
with tools to recognise and address mental healthissues and early signs of burnout.
To attend to trauma due to geopolitical turmoil,
special group sessions led by trauma experts were
held in Ukraine, Poland and the Baltic countries.
Through these sessions, we also reminded ourpeople of the support services available to them.
Our global Employee Assistance Programme
provides 24/7 confidential support for our people
and their families. Specialised support is also
provided to our line managers to help them
support team members.
Our wellbeing framework also addresses
employees’ physical, financial and social needs.
To address employees’ concerns about energy
costs and inflation, we offered a financial wellbeing
session during our annual Learn Fest, providing
tips on budgeting.

How well we collaborate across functions makes a
big difference in our ability to have an impact on
the market – to act fast and exceed customer
expectations. Therefore, for the first time this year
we introduced a standardised measurement ofcross-functional collaboration, the Collaborating
for Impact survey. We applied the same approachthat we use for measuring our collaboration withour customers, a Net Promoter Score as a gold
standard for measuring customer experience. As
all employees had the opportunity to anonymously
share their opinion, we received almost 15,000
feedback points with ideas how to strengthen
collaboration and further simplify our ways or
working. Going forward, we are addressing thebiggest opportunities to create a tangible impact
with our frontliners and our customers.
In 2022, storytelling remained the main tool for
fostering a culture of belonging and trust. One ofour main storytelling tools remains Red Talks, aformat for sharing stories about one’s growtheither during meetings or through recordings
shared through internal channels. We also
continued to grow our informal Coffee Corner
events, inviting our storytellers to talk about topics
such as caring leadership and effective
collaboration. These events inspired a growinginterest in learning from each other’s stories
across the organisation.
To celebrate collaboration across the Group, we
invited colleagues to write thank-you notes totheir most important or most frequentcollaborators during the year, and these touchingmessages of gratitude were shared at festive
year-end events. The toolkit for this culture
activation was shared with all of our markets in the
Red Talks community.
In our third year of continuous performance
conversations with mutual accountability, morethan 70% of our people provided feedback to their
managers in 2022. Nearly all of our people, 93%,
completed quarterly snapshot discussions with
their managers.

Prioritising diversity and inclusion
As a part of our commitment to have at least 50%
of management positions held by women by 2025,
we have accelerated our diversity and inclusion
efforts. Our strategy starts from retention,building capabilities, complemented by external
hiring to create a gender-balanced organisation.
Every country has targets included in theirbusiness plan together with prioritised diversity
and inclusion actions. In 2022, 51% of our internal
appointments were women, and women held
39.6% of management roles, compared with39.2% in 2021. In addition, in 2022 female
representation among senior leaders grew to
39.5% from 36.5% in 2021. Our efforts to create amore diverse work environment were recognised
externally in 2022 with 11 diversity-related awards.
The entire Executive Leadership Team
volunteered to sponsor participants of our
Women in Leadership programmes, which involvesponsors to help participants work throughcommon career barriers. In 2022, 80 women in our
workforce participated. To increase opportunities
for networking, we added three women’s networks
in Poland, Nigeria and Austria to our existing baseof local networks, with participation of ourSenior Leadership.

We improved our external hiring gender ratio formanagement roles by 11 percentage points in
2022 compared with the prior year. With special
focus on Commercial roles, we increased the ratioof women amongst our externally hired managers
in the Sales and Marketing functions to 68%, anincrease of 25 percentage points from 2021.
We continue to be a proud supporter of WeQual,and our CEO continues to be a judge of the
WeQual awards for female leaders. The network
we launched with our Coca-Cola System partners
organised the largest diversity and inclusion eventfor the European FMCG and Retail industry in Parisin 2022, where we also participated. As membersof The Boardroom in Greece and Switzerland, we
support development of women for Board positions.
To ensure we adhere to all applicable laws andregulations and demonstrate best practice, we
regularly review our Human Rights Policy, ourCode of Business Conduct, and other internal
standards. These documents are online at https://www.coca-colahellenic.com/en/about-us/
corporate-governance/policies.

41

42

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Cultivate the potential of our people continued
Helping our people realise theirpotential and developing talent

Developing critical capabilities inour sales and supply chain teams

Our employees had over 900,000 hours oflearning in 2022, including 56,000 in personal skills.
About 80% of learning items completed –representing more than half of all learning hours– are self-paced and driven by our employees,
demonstrating our culture of continuous learning.

To provide the best solutions to our customers,
we have carried out a 360-degree review of ourmost important customer-facing role, theBusiness Developer. We successfully launched anew, fully-integrated selection tool and upgraded
our Sales Academy curriculum, upskilling Sales
Team Leaders to help Business Developers grow.

To enhance continuous learning, we organised our
virtual Learn Fest for the third consecutive year,
drawing over 6,000 attendees. Ensuring all
employees can also learn from each other, we
provide all employees with access to pools ofcoaches and mentors through technologyenabled solutions. In 2022, the number of active
mentors rose to 349. After a campaign toencourage internal coaching relationships, thenumber of active engagements rose to 71.

Over 1,000 new Business Developers received
their Licence to Start and Licence to Sell
certifications through the Sales Academy in 2022,
and over 8,500 existing sales force members werere-certified in Licence to Sell. To build on our
success, licences for the roles of Sales Team
Leader, Sales Manager and Sales Trainer have also
been added, with over 40 people managers and 25
sales trainers acquiring licences in 2022.

We also accelerated development through ourTalent Review Framework. Compared to 2021, we
increased identification of potential emerging
leaders within our workforce by 20% in 2022. Morethan 300 talents went through acceleration
programmes in 2022, while, every year, more thanhalf of the participants are getting promoted intheir first year after programme completion.

Inspired by the effect of the Sales Academy on ourpeople’s growth, we launched specialised versionsof the content to meet the needs of our dedicatedcoffee and premium spirit teams and introduced aSupply Chain Academy. Covering manufacturing,logistics, planning, quality and procurement, over
1,000 employees have already been certified
through our Supply Chain Academy.

To optimise the hiring process and improve
efficiency and collaboration within hiring teams,
we launched a new recruitment platform. We also
continued our internal gig project postings
through Opportunity Marketplace, increasing
visibility of opportunities, while piloting TalentMarketplace in Austria as an integrated, skill-based
talent management solution.

To increase the time Business Developers have tospend with customers, we created guidelines tostreamline meetings and introduced feedback
mechanisms to understand their pain points. We
have also committed to set fewer priorities andclarify links between targets and incentives. Sales
leadership teams in each market are implementing
these changes in 2023.
Onboarding has also remained an important focus
point. Following the launch of our digitised
onboarding experience for our Business
Developers in 2021, we simplified the experienceand onboarded 39 new Sales Team Leaders using
an improved, user-centric development
experience in 2022.

Staying relevant to our candidates
According to a bespoke talent market survey
conducted by Universum, we maintained Top 10
rankings amongst the most attractive employers
in the fast-moving consumer goods industry
in all of our markets in 2022. In 14 of our markets
we are ranked in the Top 5 FMCG desired
employers, and in 6 markets we are the number
1 FMCG employer.
More than 40% of our external social media
communication is diversity-focused, including ourvideo series ‘Women of Coca-Cola HBC’ whichhighlights the successes of women across theGroup, reaching over 15 million people so far.
Our practices have been externally recognised
across markets, with 60 awards and certifications
received in 2022, such as Top Employers,
Randstad or PWC Employers ranking. Out ofthese, 11 recognitions are in the area of inclusionand diversity, and we’re also listed 26th in the
Refinitiv Top 100 Global Diversity & Inclusion Index.
Employee-generated content is a key elementof our external presence and nearly a third of oursocial media content is ‘behind the scenes’, suchas #Togetherness moments posted by ourcolleagues. Our employees’ active posting onsocial media ranked us in the Top 50 mostactive food and beverage companies in Europe
in 2022 according to employee-influencer
platform DSMN8. Looking ahead, we will continue
to strengthen our candidate pipeline bycommunicating our internal strengths authentically.

Priorities in 2023
• Build unmatched sales teams bystrengthening our commercial talentpipeline• Stay resilient and closely connectedwith our teams through continuous
listening and simplifying their lives tothe maximum, so that they continue
focusing on helping our customers grow• Shape our culture of proactive
collaboration using the power of ourcross-functional teams througheveryday behaviours, to be ready forwhatever challenges the future may
bring• Continue to build a diverse and inclusive
workplace where we value and respect
the skills and differences of ouremployees, allowing all unique voices tobe heard

UN Sustainable
Development Goals

Efforts to foster an engaging workplace andan inclusive environment, nurture and develop
the capabilities of our people, increase genderbalance in our management ranks and reducestress and support employee wellbeing allcontribute toward global goals for development.
The specific Sustainable Development Goals
supported are those for: good health andwellbeing; gender equality; decent workand economic growth; reducing inequalities;
and peace, justice and strong institutions.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Feature: Ukraine

Taking care of our people
and communities in Ukraine
With a presence in Ukraine formore than 30 years, the safetyof our people has been ournumber one priority in 2022.
We have provided practical andfinancial support, together with
contributions totalling over
US$20 million in 2022 to support
our colleagues and humanitarianrelief efforts.
Addressing immediate needs
In the early days of the conflict, our focus wason supporting those in immediate need however
we could. This included cash grants to our people
through the Coca-Cola Disaster Relief andCoca-Cola HBC Employee Donation funds, on
top of salary advance payments where necessary.

Coca-Cola HBC Integrated Annual Report 2022

43

44

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Feature: Ukraine continued
Adapting to a new reality
Production restarted in the Coca-Cola HBC plantnear Kyiv in May 2022, following repairs toextensive damage and with consideration for all
safety and quality requirements. All employment
has been maintained since the start of the war.
Even when production was halted, our people
continued to serve customers with deliveries
from regional warehouses and also fromneighbouring countries.

We supported those fleeing the country acrossEurope through volunteering initiatives, financial
donations and the provision of our beverages. To
date, almost 2 million litres of beverages havebeen donated. Nearly all our markets wereinvolved in some way, but neighbouring areas in
Poland and the Baltics, Slovakia, Romania andHungary were at the forefront of relief efforts.
We established 12 Coca-Cola Care Centres atsome of our offices, particularly in central andwestern Ukraine. These became a safe place fortemporary stays, equipped with food, water andother supplies. More than 700 people – ouremployees and their families – were able to havesome rest and replenishment during theirevacuation to safer regions.
We also collaborated with our partners, providing
further help. Together with our customer SPARInternational, we delivered 62 trucks of water tothose who needed it most. This was achieved
through SPAR International’s Aid for Ukraine
scheme, which coordinates humanitarian aid via
a network of non-governmental organisations.

As our people relocated, we offered a uniqueredeployment programme, ‘Re-skill 2 Win’, with
opportunities to obtain new skills in sales, quality
and manufacturing. After obtaining new skills, 22of our commercial colleagues started crossfunctional assignments as plant operators andforklift drivers.
Our colleagues in neighbouring countries
provided help also to the family members of
employees who evacuated from Ukraine,providing accommodation, covering essentials
when needed and finding relevant job
assignments for them.
We provided further help through our Employee
Assistance Programme, including dedicatedwebinars on fostering resilience, supporting
relatives and children, providing first aid andmuch more. We offered targeted mental healthassistance and nurtured the emotional
connection with our people and their families
through different master classes, contests forchildren and informal meet-ups.
We know that the need for humanitarian aid isongoing. As part of the overall US$20 million
contribution, the Coca-Cola System has
contributed US$5 million in funding towards a
partnership with the Italian Red Cross to provide
food kits and beverages to 70,000 families in
Ukraine. One kit provides a month’s supply ofhighly nutritious, long-life products.

Continuing to support colleagues
and communities in need in 2023
While we hope for a speedy and peacefulresolution, we continue to provide support while
the conflict continues. For 2023, we havecommitted a further €10 million to address theneeds of our colleagues and Ukrainian
communities, helping them to rebuild their lives
and livelihoods.
Together with The Coca-Cola Company, we aresupporting efforts to rebuild the local
community near our Ukrainian bottling plant,
including rebuilding a kindergarten.
We strongly believe in a brighter tomorrow. In
the meantime, as one connected team, we willcontinue to care for and support each other.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Growth pillar: Highlights in 2022

Ranked as theworld’s mostsustainable
beveragecompany
according to Dow Jones Sustainability
Index*** and maintained leading scoresin several other top ESG benchmarks.

Donated over
US$20 million
to support our people and communities in
Ukraine in partnership with The Coca-Cola
Foundation and the global Coca-Cola System.

15% reductionin emissions
across scope 1, 2 and 3 compared with 2017baseline, and 6% reduction compared to 2021*.

100% rPET
transitionin Switzerland for locally produced portfolio.
Austria and Italy** are moving their portfolios
to 100% rPET.
*

Recalculation of all emissions made due toconversion factors change.
** Excluding water.
*** As of December 2022.

Continued
progress inreusable
packagingwith first “new generation” Compact
Freestyle dispensing machines going
live in four of our markets, and refillable
packaging offerings expanded in Austria.

Supported thelaunch of two
new Deposit
Return Schemesin Latvia and Slovakia and a new Packaging
Recovery Organisation in Moldova.

45

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Earn our licence to operate continued

Our consumers

Governments

Our communities

NGOs

The Coca-Cola Company

Our shareholders

Our focus on sustainability is in the following key
areas: communities, climate change, packaging,water stewardship, biodiversity, nutrition andsustainable sourcing. Underpinning all thesepriorities are partnerships with The Coca-Cola
Company, The Coca-Cola Foundation, andexternal organisations such as universities
and NGOs. Only by working together can wecontribute more effectively to a better world.

Our focus in 2023 will be to drive a stronger impact
for our broader value chain, connecting young
people with future employers and partners.
Cumulative number of young people trained
through #YouthEmpowered since 2017

Communities
Over the years, the Coca-Cola System has had ahuge impact on local communities and the lives ofvulnerable people. We are always there in time ofneed, and we remain committed to providing
humanitarian support to those in crisis. This year,
we have witnessed one of the worst crises in
Europe with millions of Ukrainian families
experiencing unimaginable suffering. We quickly
mobilised our support for our people and thosein need, and will carry on doing so.

2017* As of December 2022.

Our suppliers

All environmental and sustainability reporting excludes
Egypt for 2022.

2018

2019

1,000,000

Our people

We seek to train one million young people acrossall our markets by 2025, boosting their confidence
and employability in a dynamic job market, andtargeting those not in education, employment or
training. By the end of 2022, #YouthEmpowered
had reached over 790,000 young people since its
launch in 2017.

794,943

Stakeholders

Our flagship community programme aims toprevent and combat youth unemployment andaddresses educational inequalities by providing
participants with a future-fit skillset. It offers
in-person and online training as well as networking
and mentoring sessions alongside Coca-Cola HBCsenior managers.

548,835• Cost and availability of sustainable
packaging• Ethics and compliance• Managing our carbon footprint• Suppliers and sustainable sourcing• Water availability and usage

Throughout the year we remained focused ondelivering our Mission 2025 and NetZeroby40
goals. The year culminated with the businessranking, for a sixth time, as world number one
in the beverage industry by the Dow Jones
Sustainability Index*. We are honoured that ourscore positioned us top among 7,822 companies
across 61 industries, according to the recently
issued S&P Global Sustainability Yearbook 2023
We were also recognised as an ‘Industry Mover’ as,with a seven-point increase, we were the mostimproved in the beverage industry since last year.

#YouthEmpowered

338,413

Principal risks

At Coca-Cola HBC, we are proud of our strong
track record in sustainability, which is demonstrated
by our leading scores in eight out of the ten mostrecognised external ESG benchmarks. These
results show that we are committed to growing
the right way, for the long term.

203,865• Absolute greenhouse gas emissions
Scope 1, 2, 3
• Water usage in water-risk areas• # young people trained through#YouthEmpowered• % primary packaging collected

We continued to create value for all stakeholders
by making significant contributions to thedevelopment of the societies in which we operate,
while also finding ways to take care of ourenvironment by integrating sustainability into
our decision-making and actions.

85,812

KPIs

Continuing to deliver results
for all our stakeholders

21,401

46

2020

2021

2022

2025
goal

#YouthEmpowered in action
Greece#YouthEmpowered has become a holistic
platform offering targeted upskilling andreskilling to youth, women and hotel,
restaurant and café (HoReCa) workers in
Greece. With more than 30,000 participants
since inception, it has become a leading
employability programme of the private
sector. Seeking to bridge the gap between
the skills young people have and thoseneeded to get a job, or transition to a better
job, the programme uses a curriculum whichmaps the skillsets needed for 40 soughtafter careers, using the O*Net and ESCO
international classification systems. The
programme has grown thanks to over 30
partners, and with their contributions, theprogramme now offers:• live sessions and e-learning on the mostimportant skillsets• high-impact interventions including
scholarships, internship opportunities,
individual and group mentoring andcareer consultations• an app for on-the-go learning with morethan 8,500 registered users in GreeceStrategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Earn our licence to operate continued

Supporting our communities
Product donations

c.2m litres
focused on supporting Ukraineand Ukrainian refugees

c.3.7m litres
to food banks and disaster relief

Volunteeringc.2,800*
colleagues
focused on supporting vulnerable
communities, youth and the environment

Community investments*c.€7.4m• Long-term community initiatives• Disaster relief (Bulgaria, Czech Republic,
Nigeria, North Macedonia and Serbia)

Bridging social, environmental
and economic needs for the benefitof communities

Reducing food waste and tacklingclimate change
IrelandWe always seek to positively impact people’s
lives in the communities where we operate, andto support communities in need with productdonations, volunteering initiatives and disaster
relief activities. Also Coca-Cola HBC has over theyears expanded community investments from juststandalone philanthropic initiatives to long-term
programmes closely linked to our businesspriorities and material issues. We want to explore
how we can deliver positive social outcomesthrough the way we do business and partnerwith our value chain.
We seek opportunities to contribute to communities
by bridging social, environmental and economic
needs, driving positive societal change while
creating shared value.
The two programmes described here, one in
Nigeria, one in Ireland, are examples of driving
positive change with a holistic approach.

Three-year strategic partnerships withfood redistribution services FoodCloud and
FareShare have ensured that Coca-Cola
HBC products reaching end-of-life canbe efficiently redistributed to 870 frontline
charities across the island of Ireland.
Annually, this sees 750,000 of our beverages
redirected to those in need.

Investing in the birthplaceof Coca‑Cola HBC
Nigeria
To mark the 70th anniversary of thebusiness in Nigeria, the birthplace ofCoca-Cola HBC, we donated €1 million to
local communities. This funding, completed
in 2022, targets programmes dedicatedto increasing quality of life in the country
through improvements to water andsanitation, packaging waste recycling
and the empowerment of women andyoung people.
These initiatives demonstrate how ourenvironmental sustainability investments
can also support value creation in local
communities, improving lives andlivelihoods with cleaner environments
and job opportunities.

* Including Bambi and Egypt.

1. These figures have been provided by NGO partners and are not Verified Carbon Standard (VCS) – we will work with our NGO partners to explore VCS certification for approved carbon offset in the future.

Employees have also fundraised €20,000
towards the salary of one food redistribution
driver for the charity, which in turn enabled
the delivery of more than 1.1 million
meals. To increase engagement further,
we partnered with FoodCloud and Tesco
Ireland to support those in need with
their ‘Win a Meal, Give a Meal’ Christmas
campaign, and supported employees tovolunteer their time with the charity partners.
By 2025, the initiative will have achieved
2,571 tonnes of CO2 avoidance1,
contributing to UN Sustainability
Development Goal 12.3 and Ireland’s
Climate Action Plan to reduce food waste
by 50% by 2030.

47

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Earn our licence to operate continued

Climate and net zero

In 2016 we were oneof the first companies
to adopt the Science
Based Targets. We also
introduced an internalcarbon price for businessdecision‑making
5.9

CO2 reduction
plan endorsed by
SBTi on 1.5º
pathway in 2021

-27% CO22020 vs. 2010

6

Scope 1: directemissions in direct
operations

Scope 2: indirectemissions in direct
operations

Scope 3: indirectemissions up/
downstream

Fuels used in
manufacturing, by ourown transportation fleet
or in remote properties**

Purchased energy:
electricity, used heat,steam, Combined Heatand Power (CHP) output

Packaging, ingredients,
coolers, third-party
transportation fleet

5.4% 5.4% 89.2%#NetZeroby40 roadmap for Scopes 1, 2 and 32024-2026

49% of coolers
energy efficientin 2022

We will introduce
renewable fuels
for thermalenergyAccelerate
packagingdecarbonisation
as of 2025

-14% CO22030 vs. 2020

4.3*

3.7*

4
Million tonnes of CO2e48-56% CO2
2040 vs. 2030
1.6*

2

0

-2

2010

Baseline for our first
Science Based Targets (2010).
Those targets achieved two
years ahead of the target
year of 2020

2016

2017

2020

Baseline for Science
Based Targets as per
1.5 degree scenarios (2017)

2025

2030

From 2024 to 2039:
Beyond value chain mitigation**** Recalculation of all emissions made due to conversion factors change and according to the GHG Protocol Corporate Accounting and Reporting Standard.
** Remote properties – warehouses, distribution centres or offices where there are Coca-Cola HBC employees but there is no manufacturing site (plant).
*** As defined by SBTi.

2035

Neutralisationof residual emissions
from 2040

2040#NetZeroby40
goalStrategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Earn our licence to operate continued
Climate and net zero
In 2021, we committed to reduce
emissions across our entire value chain
to net zero by 2040. Over the past decade,we halved our direct emissions, and ourgreenhouse gas emissions reduction
plan to 2030 is already endorsed andapproved by the Science Based Targets
initiative (SBTi) in line with the 1.5˚Cpathway. As 89% of our emissions are in
Scope 3, we must therefore collaborate
with our suppliers and customers to
reduce them to an absolute minimum.
By 2030 we will reduce our value chain emissionsin scopes 1, 2 and 3 by 25% vs 2017. In 2022,
we continued our journey to reduce our emissions,
reducing absolute emissions from our direct
operations and production by 21% and total value
chain emissions by 15% against our 2017 baseline*.

Scope 1: Reducing direct emissions
in our own operations
Scope 1 includes activities that are under ouroperational control, primarily our on-site energy
production and fleet. In 2022 scope 1 emissions
reduced by 13% vs prior year. This reduction was
supported by total investments of €13.7 million inprojects aimed at improving the energy efficiencyof the installations in our plants.
Green Fleet
We have accelerated the transition of our light
fleet in 2022, introducing over a thousand green
vehicles. 28% of our light fleet now consists ofmore environmentally friendly vehicle models– a four-fold increase vs the start of our transition,
helping to deliver a reduction of 19,500 tonnes of
CO2 compared to our baseline, and approximately* All the numbers on this page refer to total CCHBC
excluding Egypt unless otherwise stated.
** Recalculation of the baseline emissions (2017) made due
to conversion factors change in 2022.

20,000 tonnes of emissions reduction over thesame period of time for our heavy fleet.

Scope 2: Reducing indirect emissions
in our own operations
Our scope 2 emissions come mainly frompurchased or acquired energy. In 2022, scope 2
emissions increased by 30% vs the prior year,
heavily influenced by the current geopoliticalsituation in Europe and its impact on the energy
supply market.
Renewable and clean energy
Our use of renewable and clean electricity in our
EU and Swiss manufacturing facilities increased to
99.2% in 2022.
However, the impact of the current geopoliticalsituation drove a decline in our sourcing of
renewable and clean electricity and energy from
53% in 2021 to 43% in 2022 in total, across thewhole of Coca-Cola HBC.
Despite this decline, we delivered several projects
that helped to progress reductions in scope 2
emissions of CO2:

Absolute Scope 1 and 2 CO2 eq emissions(‘000 tonnes)
600
563
500

538

-23% -24%
432

400

A key driver of this performance was our increased
share in energy efficient cold drink equipment
placed in our customers’ outlets (49% vs 42% in2021). Additionally, we made significant progressin defining supplier-specific emissions factors,
which are critical for future emissions reduction.

-1%

426

443
-55%
256

200

4,305 4,269

-21%
-5%
4,105

-11%

-8%

3,824 3,958

2030 vs. 2017
-15%
3,678

2017

2018

2019

2020

2021

2022

2030
goal

Together with our suppliers, we are exploringcooling solution innovations. In Greece and Italy,
for example, we are currently trialling prototypes
using static cooling technology, which does notuse fans or motors.
Improving the carbon footprint of ouringredients
Since 2015, our emphasis on low- and no-sugar
drinks has decreased calories in our sparkling
drinks by 17% per 100ml, contributing to a savingof approximately 75,000 tonnes of emissions.

3,000

120

100%
in 2025

100

-21%
3,410

80

87

89

2018

2019

97

99

99

100

2020

2021

2022

2025
goal

78

60
2,000
40
1,000

100

Reducing electricity consumption in our coolers
To achieve our net zero goal, we are accelerating
the replacement of existing coolers with new,energy-efficient ones. Our goal is that 50% of ourcoolers will be energy-efficient or eco-friendly by
2025. At the end of 2022, 49% of all coolers in ourmarkets were energy-efficient or eco-friendly.
This €90 million of investments delivered a total
reduction of approximately 120,000 tonnes ofgreenhouse gas emissions in 2022 vs 2017 baseline.

Renewable and clean* electricity in operationsin the European Union and Switzerland (%)

5,000

4,000

-21%

300

0

In 2022, we made significant progress in reducing
our scope 3 emissions**, with a 7% reduction vs
the prior year.

2030 vs. 2017

-14%
481

Scope 3: Reducing indirect emissions
across our value chain

Absolute Scope 3 CO2 eq emissions*(‘000 tonnes)
-55%

-4%

• Installation of additional rooftop solar panels in
Nigeria, bringing total solar electricity generated
across six production sites to 5.2 GWh in 2022
(2.7% of total consumed electricity in Nigerianplants), with an estimated emission reductionof 2,170 tonnes.
• Switching our grid electricity in Nigeria torenewable, reducing emissions by 5,600 tonnes.
• Increase in renewable energy supply in totalenergy mix in Romania, from 24% in 2021 to
31% in 2022, saving 1,950 tonnes of emissions.

0

20

2017

2018

2019

2020

2021

2022

2030
goal

* Recalculation of all emissions made due to conversion
factors change.

0

2017

* Clean source means CHP using natural gas.

49

50

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Earn our licence to operate continued
nable packaging
SustaiHow we do it

Progress towards
sustainable packaging
Circular-by-design packaging
We believe every package has value
and life beyond its initial use and that itshould be collected and recycled into a
new package or re-used. We also seek tominimise the overall amount of packaging
that we use. Together with our suppliers
and partners, we are working to design
more sustainable packaging and takeaction to ensure that our packaging
doesn’t end up as waste.

1 Design• Lightweighted• Less packaging• Recyclable• Innovations

Our Mission 2025 sustainable
packaging commitments• Recover 75% of our primary
packaging for recycling or reuseby 2025• Make 100% of our primary packaging
fully recyclable by 2025
• Increase the percentage of rPET
in our bottles to 35% by 2025. In our
EU countries and Switzerland, weplan to reach 50% rPET by 2025

Sustainable packaging is attractive
to consumers and widely accepted.

4 Collect• Deposit Return
Schemes• Packaging Recovery
Organisations• Refillables reverse
logistics

Consumer
attractiveness

Customer
acceptance

Carbonemissions

Waste

Sustainable packaging contributes toreducing carbon emissions and waste

2022 achievements

48%

100%

of our total primary packaging wascollected in 2022 for recycling or reuseof our primary packaging is recyclable
by design

rPET:

10.5%

22.3%

of the PET that we used across total
Coca-Cola HBC markets was rPETof the PET that we used in Coca-Cola
HBC EU and Switzerland markets
was rPET

3 Reuse or Recycle• Returnable glass bottle• rPET bottles• Dispensed solution with
bag-in-box or cartridge technologies• Reusable vessels

2 Sell• Energy-efficientcoolers• Delivered with
Green Fleet

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Earn our licence to operate continued

Investing in in-house rPET
production
Italy
In 2022 we converted an old factory in
Gaglianico into an innovative hub, whichtransforms up to 30,000 tonnes of PET peryear into new 100% recycled PET preforms,
enough to meet our beverage bottlingneeds in the country. The site is fully
powered by electricity from 100% renewablesources leading to a reduction in the CO2
emissions of producing a preform by
up to 70% compared with virgin plastic.
The site employs around 40 people anduses advanced recycling technologies.
It is able to produce nine types of preforms,
performing 4,700 quality checks per day
in order to ensure that our high quality
standards are met. This is enabling our
Italian operation to shift its entire portfolio*
to 100% rPET.

Designing in circularity
We use the concept of circular-by-design
packaging with objectives of reducing waste
and carbon footprint, while maximisingcommercial value.
• We introduced the first label-free branded
water packaging in Switzerland, launching threelabel-free variants of Valser. The distinctive lookdifferentiates our products while improving theease of package recycling.
• Our KeelClip™ innovation has allowed us toeliminate plastic packaging from our can
multipacks in 22 countries so far, helping us
to reduce our plastic packaging footprint.
• Tethered caps: In 2022, we moved to tetheredcaps in 3 countries (Hungary, Italy and Bulgaria),
across various portfolios, including sparklingsoft drinks, water and aseptic PET. In 2023,
we will continue with this roll-out to ensure fullcompliance in all EU countries by the Single-Use
Plastics Directive (SUPD) deadline.

Shifting to recycled PET
100% of our primary packaging is recyclable bydesign and we are committed to increasing theuse of rPET in our bottles across the Group. ​• By 2025 at least 35% of the PET we use to makeour bottles across our Group and 50% in EU
countries and Switzerland will be recycled plastic.
• In 2022, Switzerland moved all its locally
produced portfolio in plastic bottles
to 100% rPET.
• Italy and Austria also began transitioning theirlocally produced PET portfolios* to 100% rPET
in Q4 2022.

* Excluding water in Italy.

To help us reach our rPET goals, we are investing
in in-house rPET facilities. ​We have introduced in-house rPET production
technology at plants in Italy*, Poland and Romania.
Our total investment in these technologies will bealmost €50 million in 2023.​

Supporting reusable beverage systems
We support increasing reusable beverage systems
as part of a suite of measures to improve
circularity for packaging and to reduce total
emissions. We are implementing solutions such as
refillable bottles and packageless dispensers,
where reusable vessels may be used.
• 12% of total transactions (or packaging units)
sold across Coca-Cola HBC markets in 2022
were in refillable containers. Nigeria and North
Macedonia have the highest proportion ofrefillable packaging within their portfolios, bothat 35%, while Bulgaria and Croatia have 27% and
29% refillable containers, respectively. Austria is
one of the fastest growing refillable markets,from 12% in 2021 to 16% in 2022. We expect
this trend to continue in 2023, driven bycontinued investment and marketing support.
• We continue to innovate with bag-in-box andcartridge technologies. The first Compact
Freestyle machines are going live in four of ourbusiness units – Switzerland, Austria, the islandof Ireland and Italy.
• Moving forward we plan to introduce more
initiatives to implement reusable vessels forour packageless solutions, in partnership withour customers.

Improving collection schemes
Our goal is to recover 75% of our primary
packaging for recycling or reuse by 2025, and we
strive to collect a bottle or can for every one that
we sell by 2030. To achieve this, we are investingin circular systems that support high rates of
packaging collection, effective recycling and useof recycled materials.
• Deposit Return Schemes (DRS): In 2022, we
supported the launch of two new DRS in
Slovakia and Latvia, bringing the total number of
DRS in Coca-Cola HBC territories to five,including Croatia, Estonia and Lithuania.
• Packaging Recovery Organisations (PROs):
Following a successful pilot programme in
Moldova, we played an active role in the launchof a new PRO there in late 2022. We look forward
to increasing collection rates further in Moldova
as a result of this launch, and supporting asimilar PRO launch in Ukraine in 2023, subject
to developments.

51

52

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Earn our licence to operate continued

Water stewardship
Water is the main component of ourbeverage production and is essential to ourmanufacturing processes. We are committed
to protect this valuable resource and to reduce
the amount of water we use in all our activities.
To achieve our Mission 2025 objectives, we areworking to minimise water use by 20% in plantsthat are located in water risk zones. Together
with our stakeholders and local communities,
we also want to make sure that people in waterrisk zones where we operate have access tosafe, clean water.
All our plants, except the recently acquired
Lurisia plant in Italy, Teplice in Czech Republic,
Natura in Serbia and Egypt plants are certified
by Alliance for Water Stewardship (AWS) which
confirms that the plants meet the global
benchmark for responsible water stewardship.
This certification covers 95% of the plants and99.6% of the production volume (excluding
Egypt plants, Bambi and Tsakiris), and 87% of
the plants and 88.8% of the production volume(excluding Bambi and Tsakiris).
The water usage ratio of our priority locations
increased slightly in 2022 due to changes in
production patterns at several big volume
plants. Despite the overall increase, we
achieved significant reductions in water
consumption at a number of plants. Water use
ratio fell by 17% in Heraklion (Greece), 16% in
Yerevan (Armenia), 8% in Asejire (Nigeria), and
2% in Rionero (Italy).

Going forward, we continue to implement water
reduction plans at priority locations in water riskzones. In addition to upgrading our production
facilities with equipment and technologies
requiring less water consumption, we are seizing
opportunities to reuse water in production
facilities, designing full-plant water reuse systems.

Water stewardship program in Nicosia
In 2022 we started, in collaboration with Global
Water Partnership – Mediterranean (GWP-Med)and with the support of The Coca-Cola
Foundation, a new water stewardship projectin Nicosia, in Cyprus, which is one of our waterpriority locations. The project is designed for
Non-Conventional Water Resources (NCWR)
technical solutions in a smart-city context.
Its scope includes greywater reuse, rainwater
harvesting, information & communication
technologies for smart watering, water efficiency
applications and awareness building. The expected
benefit of the project will be around five million
litres of saved water annually.

‘Zero Drop’
In the community of Profitis Ilias in Heraklion(Greece) we launched ‘Zero Drop’ programmein partnership with the Global Water Partnership– Mediterranean (GWP-Med) and The Coca-Cola
Foundation. A new water piping network will
replace the old existing pipes and as a result thetreated wastewater will be used for irrigationof adjacent agricultural areas. The estimatedcurrent annual losses with the existing piping
network are around 10 million litres of treatedwastewater which will be saved within the‘Zero Drop’ programme.

Mission 2025 target

20%

reduction in water use in water risk zones

Help securewater availability for all our communities
in water risk areas

Water use ratio in water priority plants(litre/litre of produced beverage)
2.5

-20%

2025 vs. 2017
2.0

1.97

1.93

1.82

1.82

1.80

1.82

1.5

1.57

1.0

0.5

0.0

2017

2018

2019

2020

2021

2022

2025
goal

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Earn our licence to operate continued
We are already reducing our water consumption
and contributing to water security through water
replenishment activities, wetland restoration and
WASH (water, sanitation and hygiene) projects.
We also ensure that 100% of all wastewater fromour bottling plants is treated to the levels
supporting aquatic life before it is returned towatersheds and nature. These actions protect andreinstate watersheds that foster biodiversity.

Sustainable sourcing

Biodiversity
In 2022, we committed to achieve a net positive
impact on biodiversity in critical areas of ouroperations and supply chain by 2040. We also
want to eliminate deforestation in our supply
chain by 2030.
We will do this by reducing emissions and wateruse, preserving and reinstating water priority areasand sourcing agricultural ingredients sustainably.
In so doing, we will build adaptation and resilience
into our sourcing and operations.
We are working to establish baselines so we canpursue our goal through a science-based

Partnerships
Only by working together we can build a better,more sustainable and inclusive future. Our
success today is only possible due to our strong
and professional partners. Notable examplesof our partnerships are in the area ofsustainable packaging.
We were excited to embark on a newcollaboration in 2022 with the Centre for
Enzyme Innovation at the University ofPortsmouth in the UK to scale innovations
in PET recycling using enzymes.

approach. Our efforts will begin with a mappingand materiality assessment on biodiversity acrossour value chain to help us measure our progress.
We are also engaging with partners andcollaborating with The Coca-Cola Company
to determine priorities, target dates andimplementation plans, and will communicate
these over time.
In June 2022, we joined the Science Based
Targets Network (SBTN) Corporate Engagement
Programme. We will work to implement the SBTN’s
guidance, which provides a framework and tools
to focus efforts so both nature and businesscan thrive.

Professor Andy Pickford, Operations Director at
the Centre for Enzyme Innovation said: “There
are many benefits to using enzymes to recycle
PET, since the process has the potential todeliver infinitely recyclable rPET with virginlike properties, thus reducing theenvironmental impact of plastic waste. We are
eager to work with Coca-Cola HBC to explore
how the process could be translated from thelaboratory to commercial scale.”

We are committed to sourcing 100% of our key
ingredients in line with the Principles for Sustainable
Agriculture as set out by The Coca-Cola Company.
Of specific importance to achieving our biodiversity
goal are the principles on conservation of forests,
conservation of natural habitats, biodiversity
and ecosystems, soil management andagrochemical management.
Overall, the principles protect and support
biodiversity and ecosystems, uphold human andworkplace rights, ensure animal health and welfare
and help build thriving communities. They apply tofarm-level production and form the basis for ourcontinued engagement with Tier 1 suppliers toensure sustainable long-term supply with lower
environmental impact.

We are continuously seeking innovative
solutions to make our packaging moresustainable and we understand that science is
key to unlocking solutions. For this reason in
2022 we also invited start-up companies to bidfor €100k to develop their innovative solutions
contributing to circularity.
Our partnership plans for 2023 include
increasing the scope of existing partnerships inwater and waste reduction and entering newpartnerships in support of biodiversity andcarbon removal.

Priorities in 2023
• Continue reducing emissions in alignment
with our NetZeroby40 roadmap• Accelerate decarbonisation of our
packaging while connecting these changes
with revenue growth• Support further roll-out of Deposit Return
Schemes in CCHBC countries, with a focus
on our EU markets. Promote EPR policies
and the launch of new packaging collection
systems in priority markets, including
Ukraine, Egypt and Nigeria• Complete biodiversity impact study andstart designing our action plan
• Expand our partnerships in water andwaste reduction, while exploring newareas of partnerships: biodiversity andcarbon removal• Continue focus on #YouthEmpowered
as our flagship community programme• On-going support to communities in need

UN Sustainable
Development Goals

Our initiatives in communities help advance theglobal objectives of good health and wellbeing,and sustainable cities and communities.
Our initiatives to empower youth and womencontribute to the goals for quality education,
decent work and economic growth, sustainable
cities and communities, and partnerships.
Our initiatives regarding water stewardship,
CO2 emissions reduction and waste reduction
aid global progress towards the SDGs for cleanwater and sanitation, and climate action.

53

54

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Key performance indicators

Tracking ourprogress
We measure performance against our
strategic objectives using specific key
performance indicators (KPIs). These
KPIs allow us, and our stakeholders,to track our progress in deliveringon our targets.
These are also the financial andoperational milestones which we focus
on in implementing our Growth Story
2025 strategy.

1 Leverage our unique 24/7 portfolio
2 Win in the marketplace
How we measure our progress

Volume is measured in unit cases, where one unit caserepresents 5.678 litres. We grow volume as we expand
per-capita consumption of our products and expand into
new markets or categories. Since the start of 2022 wemeasure volume growth on an organic basis.

What happened in the year

Volume declined by 1.5% on an organic basis, adversely
impacted by declines in Russia and Ukraine. Excludingthese markets, organic volume growth was up 8.1%.

Link to remuneration

Organic1 volume growth (%)
15

9
6
3

Revenue growth is used to assess businessperformance for the purpose of annual Management
Incentive Plan (MIP) bonus awards, and volume is a key
component of revenue.

0

See p139 for a full description of the MIP.

-9

How we measure our progress

We measure revenues per case and revenues on anorganic basis to allow better focus on the underlying
performance of the business. We grow organic revenue
per case through pricing and improving mix.

What happened in the year

Organic revenue per case grew by 15.9% as pricing andrevenue growth management actions in all markets
drove improvements throughout the year. Organic
revenue grew by 14.2%, while excluding Russia andUkraine organic revenue grew by 22.7%.

Link to remuneration

Revenue growth is used to assess business performancefor the purpose of our MIP awards.
See p139 for a full description of the MIP.

14.0

12

2.6

2020

2019

-3

2021

2022
-1.5

-4.6

-6

Organic1 revenue per case growth (%)

Organic1 revenue growth (%)

20

25

15.9

15

20

20.6

15
10

5

0

14.2

10
5

5.8
1.1
2019

0

2020
2021

2022

1. For details on APMs refer to ‘Alternative Performance Measures’and ‘Definitions and reconciliations of APMs’ sections on
pages 245-249.

2020
2021

-5
-8.5

-4,1
-5

3.7
2019

-10

2022

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Key performance indicators continued

3 Fuel growth through competitiveness and investment
How we measure our progress

We measure this by comparable EBIT and comparable
EBIT margin progress. We generate positive operational
leverage as we grow revenues on our efficient cost base.
Using a comparable measure allows us to adjust for
one-off items which impact comparability of performanceyear on year.

What happened in the year

Comparable EBIT grew by 11.9% and by 1.3% on anorganic basis. Comparable EBIT margins declined by
150bps and by 130bps on an organic basis.

Link to remuneration

Comparable EBIT is used to assess businessperformance for the purpose of our MIP awards.
See p139 for a full description of the MIP.

How we measure our progress

We measure capital expenditure (capex) as a percentageof net sales revenue (NSR), and ROIC (return on invested
capital), to ensure prudent capital allocation and efficientworking capital management. Disciplined investment
supports our growth.

What happened in the year

Capex as a percentage of NSR reached 6.4%, just below
our targeted range for this metric following thesuspension of capex investment in Russia in 2022.

Comparable EBIT1 (€m)

Comparable EBIT 1 margin (%)

1000

12
11.6

929.7
800

831.0

10.8

758.7

10

672.3

600

10.1

400
8
200

0

2019

2020

2021

2022

6

Capex1 as percentage of NSR (%)

ROIC1 (%)

8

16
7.6

2019

ROIC is given a 42.5% weighting in the assessment of
performance conditions used to determine long-term
Performance Share Plan (PSP) awards.

2021

2022

14.8
14

6.9

14.2

14.1

6.4
6

12
11.1

5

4

See p139 for a full description of the PSP.

2020

7.5

7

We delivered another year of good ROIC performance.
ROIC excluding Egypt was 15.8%.

Link to remuneration

11.0

10

2019

2020

2021

2022

1. For details on APMs refer to ‘Alternative Performance Measures’and ‘Definitions and reconciliations of APMs’ sections on
pages 245-249.

8

2019

2020

2021

2022

55

56

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Key performance indicators continued

4 Cultivate the potential of our people
How we measure our progress

We conduct an engagement survey with an independent
third party and measure our results against the norm forcompanies which perform highly on this metric.

What happened in the year

Our employee engagement is below the global top
decile norm.

Link to remuneration

Maintaining our high engagement score is one of the
CEO’s individual performance metrics. These are usedalong with business performance measures to determine
the CEO’s annual MIP bonus award.
Read more on pages 38-42.

Employee engagement score (%)
10080

One of our Mission 2025 commitments is to have at least
50% of management positions held by women by 2025.

40

20

Global top
decile norm

Employeeengagement

Percentage of managers that are women (%)
50

What happened in the year

In 2022 women held 39.6% of management roles,
compared with 39.2% in 2021. Our efforts to create amore diverse work environment were recognised
externally in 2022 with 11 diversity-related awards.

85

60

0

How we measure our progress

88

50

40

39.6

30

Read more on pages 38-42.
20

10

0

2025 target

Women
managers

Coca-Cola HBC Integrated Annual Report 2022

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Key performance indicators continued

5 Earn our licenceto operate
How we measure our progress

Progress on Mission 2025 as well as progress towards
our NetZeroby40 ambition.

Mission 2025 – our sustainability commitments
Sustainability is integrated into every aspect ofour business. It is fundamental to our businessstrategy, which aims to create and share value
with all of our stakeholders.

What happened in the year

We made progress against most areas of ourcommitments; however, we need to accelerate our
improvement in packaging and focus more on water
reduction and health and safety.

Link to remuneration

Our efforts and ambitions are long term and cumulative,
therefore greenhouse gas reduction is used todetermine long-term PSP awards. Greenhouse gas
reductions have a 15% weighting in PSP determinations.
The benefit of this KPI is that it is quantifiable, and severalof our Mission 2025 commitments feed into its progress.
Read more on pages 45-53.

Our Mission 2025 approach is based on our
stakeholder materiality matrix and is fully alignedwith the United Nations Sustainable Development
Goals (SDGs) and their targets. Our six key focus
areas reflect our value chain: reducing emissions;water reduction and stewardship; packaging(World Without Waste); ingredient sourcing;nutrition; and our people and communities.

The table provides data on the progress of eachof the six sustainability pillars.

Sustainability targets
Sustainability areas
and material issues

UN’s Sustainable Development Goals(SDGs) and their targets

Climate andrenewable energy

7.2
7.3

9.4

• Climate change• Economic impact

12.2

13.1

11.6

2025 commitments1

2022
Statusperformance30%

reduction in carbon ratio
in direct operations

31%

50%

increase in energy-efficient
refrigerators to half of ourcoolers in the market

49%

50%

of our total energy fromrenewable
and clean2 sources

43%

electricity used in the
100% total
EU and Switzerland from

Impact from Russian
operations.

99%

renewable and clean2 sources

Water reduction
and stewardship• Water stewardship• Economic impact• Biodiversity

6.1
6.4
6.5
6.6

9.4

11.6

20%

12.1
12.2
12.4

15.1

17.17

secure water availability
100% help
42%
for all our communities

water reduction in plants
located in water-risk areas(water priority locations)in water-risk areas (waterpriority locations)

7.4%

Impact from Russian
operations. Further
implementation of
successful practices
and innovations
for those locations
is planned.
Eight projects outof 19 locations.

57

58

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Key performance indicators continued
Sustainability targets continued
Sustainability areas
and material issues

World Without
Waste• Packaging and waste
management• Economic impact

Key to performance status

UN’s Sustainable Development Goals(SDGs) and their targets
8.4

12.1
12.2
12.5

9.4

14.1

11.6

17.17

2025 commitments1

2022
Statusperformance

75%

48%

35%

help collect the equivalent of
75% of our primary packaging
of total PET used fromrecycled PET and/or PET
from renewable material

packaging to
100% ofbeconsumer
recyclable
our key agricultural
12.1
100% ofingredientssourced in line
12.2
3

Ingredient sourcing• Product quality• Human rights, diversity
and inclusion• Economic impact• Sustainable sourcing

Nutrition

8.3
8.8

9.4

25%

reduce calories per 100mlof sparkling soft drinks(all CCHBC countries)4

17%

5.5

10%

community participantsin first-time managers’
development programmes

9%

10.2
10.4

11.6

1M

train one million young people
through #YouthEmpowered

794,943

16.7

17.16
17.17

20

engage in 20 zero-waste
partnerships (city and/or coast)

145

3.4

12.8

3.4
3.6

4.3
4.4

8.5
8.6
8.8
12.2
12.4

• Product quality• Nutrition• Responsible marketing

Our people andcommunities• Human rights, diversity
and inclusion• Employee wellbeing
and engagement• Corporate citizenship• Packaging and waste
management• Economic impact

100%
78%

with sustainable agriculturalprinciples

12.4
12.6
12.7

13.1

10.5%

employees take part
10% ofin volunteering
10%
initiatives
zero fatalities among
ZER0 target
1
our workforce(lost time) accident
50% reduced
15%
rate per 100 FTE

50%

of managers are women

40%

Action plan in place todeliver roadmap targets,see page 50-51.
Annualised benefits fromtransition to 100% rPET in
Switzerland, Austria and
Italy will be reflected in
2023 results.

Each of the Mission 2025 commitments is broken down
into a series of annual targets that need to be met inorder to be fully on track with our 2025 goal. The colour
coding below reflects the current status in relation to thedesired position at this point in time on the trajectory
towards 2025 and our agreed action plans, i.e.:
We are fully ahead or on track to meetingthe target
We are not fully on track, but we do not believe
there is risk to meeting the target
We are not on track, and without corrective action
there is risk that we will miss the target

Impact of geopoliticalsituation in Russia andUkraine.

Cumulative number
2017-2022; 2022-only
number is 246,108.

The main causes: falls /slips / trips, road accidents
and contact withmachinery and tools.
Female retention,
capability building,balanced external hiring,country specific targets
and plans, see page 41.

Note: The 17 SDGs are an urgent call for action by all countries– developed and developing – in a global partnership. Each of the
17 goals has very specific targets, referenced by the numbers
shown above.
1. Baseline 2017. Egypt is excluded as the integration has notbeen finished.
2. Clean source means CHP using natural gas.
3. Technical recyclability by design.
4. Baseline 2015.
5. Supported by The Coca-Cola Foundation.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality

2022 materiality assessment
Our materiality assessment is carried out in fourphases: 1) identify potentially relevant material
issues; 2) assess their impact on, or importanceto, stakeholders and to the business, including
financial impact; 3) assess their impact on society
and environment; and 4) review and validate
findings. This process allows us to gauge therelevance of different topics for key stakeholder
groups and helps us identify and manage our
impacts as they change and as new ones arise.
We periodically adjust our approach as standards
and best practice evolve. For example, as part ofour materiality survey in 2022 we asked questions
in order to assess double materiality. Double
materiality requires the business to assess both
the risks and opportunities linked to ESG topics
that can influence enterprise value creation,or inward impacts, and the ESG impacts that acompany can have on the environment and society,or outward impacts. Dynamic materiality recognisesthat the financial materiality of sustainability
impact can evolve over time, and sometimes
quite rapidly. In other words, topics that might beconsidered financially immaterial today could
prove to be of critical importance tomorrow.

Using findings from our materiality survey andresearch, we derive the relative impact of eachissue and prioritise them accordingly. The Social
Responsibility Committee of the Board reviews
and subsequently endorses the prioritised listof issues, resulting in the materiality matrix.
For a third year in a row, climate change andpackaging and waste management are the mostsignificant material topics for Coca-Cola HBC.
Our 2022 assessment also confirmed the criticalimportance of sustainable sourcing, economic
impact and corporate governance.
In 2022, we added two new material topics to the
12 topics already identified as material. Basedon the outcome of our materiality assessment
process, biodiversity and food loss and waste are
now managed and disclosed as material issues.
We also made new commitments related to ourprogress in these two areas. For details about
our new targets for biodiversity and food loss andwaste, please see pages 53 and 27, respectively.

Very highEnvironmental dimension

Packaging and waste management

High

At the end of 2022, we approached approximately
1,570 internal and external stakeholders, including
consumers, customers, employees, suppliers,
community representatives, governments,
non-governmental organisations, investors, tradeassociations and academics. We asked
stakeholders to identify those topics with thegreatest impact on environment, people, society
and economy over time, and the greatest
importance to our stakeholders and our business.

Economic dimension
Social dimension

Importance to stakeholders

To understand which issues matter most to ourbusiness, our stakeholders, the communities
where we operate and for the wider world, we
regularly (at least annually) conduct a rigorous
materiality assessment. We take an integrated,
inclusive approach, designing the process incollaboration with colleagues across multiple
functions and partnering with The Coca-Cola
Company on our annual materiality survey.

2022 Materiality matrix

Human rights, diversity
and inclusion

Employee wellbeing
and engagement
Corporate
citizenship
Nutrition
Responsible
marketing

ClimatechangeEconomic impact

Corporate governance
Product quality

Moderate

Materiality
assessment

To assess inward impacts, we use our annualmateriality survey, but also investor-driven
frameworks such as the Sustainability AccountingStandards Board (SASB), insights from regularcalls with investors, our risk management process,including climate scenario analysis, and input fromour markets and business units. Our assessmentof material outward impacts is presented in thehorizontal axis of the materiality matrix, and in the2022 GRI Content Index.

Sustainable sourcing

Water stewardship
Biodiversity
Food loss and waste

ModerateHigh

Very highImpact of the issue on environment and society
In addition, in 2022, with a cross-functional internalteam, we assessed the qualitative impact of thematerial issues on planet, society and people,
as shown in the diagram on the next page.

Managing and disclosing material issues
Regular assessments of materiality inform ourapproach to sustainability, ensuring we focus on
the biggest impacts and tackle the issues thatmatter most. Material issues are integrated in our
Growth Story 2025 strategy, our short-, medium-,and long-term goals and are linked to our risks
and opportunities.
Our materiality process also informs ourdisclosure, including the content of this report.
Our Integrated Annual Report is aligned with theprinciples and elements of the International
Integrated Reporting Council’s (IIRC) framework,
the SASB, and prepared in accordance with the

Global Reporting Initiative (GRI) Universal
Standards (2021), amongst others.
The Executive Leadership Team has responsibility
for integrating our sustainability priorities into ourbusiness strategy and activities. Management of
the potential risks, opportunities and impacts ofour material issues takes place across theCompany and is disclosed throughout this report.
Additional information about our material issues
is included in our GRI Content Index.
We support the UN sustainability agenda and alignour efforts with the UN Sustainable Development
Goals. Annually, we report our UN Global Compact
Communication on Progress on the UN website.
Our Mission 2025 sustainability commitments,
our short-, medium-and long-term ESG goals,
including our NetZeroby40 goal, and our material
issues, are all linked with the UN Sustainable

59

60

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued
Development Goals and their underlying targets.
You can find more about how our material issues
and sustainability commitments link to the
Sustainable Development Goals on pages 57-58
of this report and on our website.

Recommendations from stakeholder
forums help us grow together
Every year we hold a Group Stakeholder Forum tosolicit input and recommendations from a groupof experts. Many of the sustainability initiatives
highlighted in this report initially came fromdiscussions at our annual stakeholder forums.
For example, the 2018 stakeholder forum focusedon packaging and our stakeholders recommended
reducing packaging design complexity, as wehave done with the label-free water packaging
we introduced in Switzerland. This improves
recyclability and reduces waste.
The theme of our 2021 stakeholder forum wasforming better, stronger ESG partnerships. We
subsequently developed our Sustainability
Partnership Model to guide joint value creation
with customers.
To minimise the carbon footprint of ourengagement, our 2022 stakeholder forum wasonce again held online. The focus of the 2022
forum was delivering value both for business andsociety (the exact Forum theme was: Bridging
the social and the economic: how can companies
invest to deliver value both for business andsociety?). We welcomed 81 stakeholders from
25 markets to discuss opportunities for creating
shared value and strengthening positive change insociety. As in prior years, participants included ourinvestors, customers, suppliers, NGOs, academia,
policymakers, and other stakeholders. Together,
we explored potential solutions to social challenges
and ways to reinforce the links between social andeconomic progress.

Our stakeholders identified scale as the mostimportant barrier in creating shared value andacknowledged that this can only be resolved
through collaboration across business and the
public sector. Forum participants emphasised thattackling social issues is an organisational task, nota functional one, as social, economic andenvironmental issues are increasingly intertwined.
Our stakeholders concluded that shared value
creation is a new way to achieve economic success.

To get inspired and learn from opinion leadersand experts we focused our event on thefollowing aspects:• the economic transitions needed for the
next decade;• aligning business growth opportunities withsocial needs;• driving economic progress through community
programmes;• enabling sustainable and inclusive growththrough our value chain; and• tools for measuring the social and business
impact of our investments.

Material issue impact in eachstep of our value chain: how
significantly each material topic
impacts society and environment,
based on the scale of the impact,
severity and likelihood

Additional suggestions from our stakeholders
included:• expanding the scale of Coca-Cola HBC’s
projects by including customers, suppliers andbroader stakeholder groups;
Upstream

Agriculture andingredients

Packaging• expanding impact by working with small andmedium-sized companies across the value
chain, and not only with large entities;• embedding circularity throughout projects; and• strengthening social impact through creation ofshared value, including profitability, which
incentivises programme expansion.
These outcomes and recommendations were
subsequently discussed with the Social
Responsibility Committee of the Board. They will
help us further evolve our programmes for thecommunities where we operate, as we seek toincrease impact and expand shared value creation.

Direct operations

Manufacturing*

Downstream

Distribution

Cold drink
equipment

Customers andcommunities

Biodiversity
Climate change
Corporate citizenship
Corporate governance
Economic impact
Employee wellbeing
and engagement
Food loss and waste
Human rights, diversity & inclusion
Nutrition
Packaging and waste management
Product quality
Responsible marketing
Sustainable sourcing
Water stewardship* Includes our direct operations, not only manufacturing plants.

Low

MediumHigh

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Managing risk
and resilience
As we navigate geopolitical uncertainty
and inflationary pressures whileremaining focused on our Growth
Story 2025 to support the long-termsustainable success of our business, theprocess of understanding and managing
our material issues and principal risks ismore important than ever. To support
success, we use a well-established,collaborative approach, which weperiodically refresh as best practice,international standards and our businessneeds evolve.

Our approach to risk and resilience

Our rigorous, ongoing risk management process
supports business resilience and is an input to ourannual assessment of material issues. See page
59 for our materiality process and material issues.
Due to their criticality, our material issues andprincipal risks are monitored closely by the
Executive Leadership Team and our Board.

In 2022, we continued the integration ofenterprise risk management (ERM), insurance,
security, business continuity and crisis
management to develop our holistic businessresilience programme. For us, business resilienceis focused on building and improving theCompany’s capability to prepare for and respondto changes in our environment to ensure we meet
our short (12-18 months), medium (2-5 years) andlong-term (5 years+) objectives. It recognises thatwhile our risks present potential negative impacts,
they also present opportunities. The earlier we
identify, assess and manage risk, the higher the
likelihood we can prevent or reduce negative
impact and take advantage of opportunities.
Business resilience starts with the review of ourconstantly changing operating environment andthe assessment of the current and emerging risks
and opportunities inherent in it. Our managers
develop and implement plans to manage thoserisks – including ensuring we can continue to serve
our customers if events lead to disruptions; ortake advantage of those opportunities. For those
events we cannot prevent, we have wellestablished processes to reduce the impact on
the business via our crisis management
programme (the Incident Management and Crisis
Resolution, or IMCR programme) and the financial
impact through our insurance programme.
This seamless, cross-functional approach breaks
down organisational silos and ensures alignment
on positive forward momentum.
The business resilience programme is led by our
Chief Risk Officer (CRO), who works in close
collaboration with the risk owners across ourbusiness units, Group functions and Executive
Leadership Team. The CRO is tasked withmaintaining a wide-angled view of all businessstreams and emerging risks and opportunities
and, through regular reporting, ensures thatvisibility and decision support is provided to the
Executive Leadership Team and our Board.

Risk and resilience in our business units
and markets
Risk sponsors and risk and insurance coordinatorsin every business unit facilitate the crossfunctional process of continuous identification
and assessment of operational and emerging risks
and opportunities on a country-by-country basis
as set out in our ERM framework.
This assessment is discussed at senior leadershipteam meetings every month and risk registers are
updated accordingly. All risk registers are visible to
the Group’s Business Resilience Team who review
operational and emerging risks, identify key trends
and provide benchmarking for the identification,assessment and management of risks andopportunities across the business. The BusinessResilience Team also reviews business continuity
plans across the Group to ensure they are up todate and have been tested.
Twice a year the Business Resilience Team, led by
the CRO, hosts a business resilience conference
where all risk sponsors and risk and insurance
coordinators are updated on key trends andemerging risks across the business. The CRO also
facilitates a discussion with the regional
management teams and General Managers twice
each year in key markets to discuss risk andresilience issues and trends, and to benchmark
risks across the business.

61

62

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued
At least once every other year, each business unit
participates in an incident management and crisis
resolution (IMCR) validation exercise. This includes
training and participation in a crisis simulation
based on a relevant business risk.
In 2022, we prepared the Egypt management
team for full incorporation into our resilience
programme, holding training and development
sessions with key managers and the seniorleadership team in risk management and IMCR. In
2023, we expect to fully incorporate the Egyptianbusiness including the adoption of the monthly
risk review routines and participation in an IMCR
training and validation exercise.

Group management
The CRO also facilitates a discussion twice a yearwith Group function heads and their teams toreview key operational, strategic and emerging
risks across the business and identify bestpractices for mitigation plans to improve our risk
and resilience programme.
One of the most significant risks to our Company’s
resilience over the longer term is climate change.
It also presents us with significant opportunities
if we proactively prepare our business withwell-thought-out adjustments to our businessstrategy and capital investments. As climatechange risk is fully integrated into our risk
management programme, the CRO also facilitates
more regular discussions with a cross-functionalteam that includes representatives from BusinessResilience; Finance; Quality, Safety and Environment;
and Corporate Affairs and Sustainability, applying
our risk management models to our assessmentof climate change risks. For more information,
see pages 72-74.

The outcome of these discussions with business
units, region teams and the Group function heads
are integrated into our Principal Risk Report thatis reviewed by the Group Risk and Compliance
Committee (GRCC), which meets quarterly and is
co-chaired by the CRO. The GRCC is made up of
the Group function heads that are the ‘risk owners’
for each of our risk categories; it ensures that our
principal risks are reviewed from a broader
cross-functional perspective. The results of the
GRCC’s discussion are integrated into the
Principal Risk Report that the CRO provides the
Executive Leadership Team and the Audit and Risk
Committee of the Board each quarter.

Risk governance and the roleof the Board
The Board retains overall accountability andresponsibility for the Group’s risk management
and internal control systems, has defined theGroup’s risk appetite, and, through the Audit andRisk Committee, reviews the effectiveness of thesesystems. During the year, the Board considered
the nature and extent of the principal and emerging
risks and opportunities, including those associatedwith climate change, that have the potential toimpact the Group’s strategic objectives.
Additionally, the Social Responsibility Committeeof the Board takes a particular interest in risks
associated with climate change as set out on
pages 126-127.
During the year, the Audit and Risk Committeeof the Board conducted a robust assessment of
the principal and emerging risks, considering thenature and extent of the principal risks that havethe potential to impact the ability of the Group toachieve its strategic objectives, as well as reviewing
the structure and implementation of the ERM
programme and internal control systems. This
enabled the Audit and Risk Committee to provide
assurance the Board that the company’s principal
and emerging risks were being managed effectively.

A key role of the Board is to establish the Group’s
risk appetite. In 2021, the Audit and Risk
Committee approved a revised Risk Appetite
Statement but also reviewed a series of
supporting statements for each risk categoryin our Risk Universe. In 2022 these supportingstatements were integrated into our risk
assessment process, providing additional
guidance to business units and Group functions
on risk appetite thresholds. In 2023, we will drive
practical application of our risk appetite further
into the business by establishing risk tolerance
levels for each risk as a key element of our risk
assessment process. The Board will review the
Risk Appetite Statement again in 2023.
Our internal audit department conducts an annual
independent review of the business resilience
programme and its implementation, assessing theCompany’s risk management, business continuity
and crisis management processes and theirapplication against business best practices andInternational Accounting Standards. The Corporate
Audit Director makes recommendations toimprove the overall business resilience programme,
where required, with the findings submitted to the
Audit and Risk Committee of the Board. Buildingon this review, the Board and its Committees also
conduct annual reviews of the effectiveness of
our internal controls. Further details of that review
are set out in the Audit and Risk Committee
Report on pages 118-123.

In the section below, we have grouped
our principal risks to highlight theconnectivity between risks.
Responding to upheavals
in the macroeconomic andgeopolitical environment
Leveraging our unique
24/7 portfolio – andresponding to change
Maintaining operational
excellence in volatile markets
Managing the risks andopportunities of climatechangePrincipal risks trend
Increasing
StableDecreasing

Risk included in viability assessment

Link to growth pillars

1

2

3

4

5

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Principal risks 2022
Responding to upheavals in the macroeconomic
and geopolitical environment
Principal risks trend

Risk included in
viability assessment

Increasing
StableLink to growth pillars

Decreasing

1

2

3

4

Principal risks:• Commodity costs• Foreign exchange fluctuations• Economic conditions• Geopolitical and security environment

In 2022, as general market conditions continued
to improve with hotels, restaurants and cafés
returning to normal business operations post
COVID-19, the general macroeconomic andgeopolitical environment exacerbated by the
Russia/Ukraine crisis affected many of ourprincipal risks.

5

Principal risk: Commodity costs
In 2022, we continued to see pricing fluctuations
in key raw materials such as resin, sugar andaluminium. Driven largely by the Russia/Ukraine
crisis, increased pressure on gas and oil
prices and market volatility led to an increasein utility costs.
In the medium-longer term we expect
commodity costs will be impacted by climatechange as suppliers are affected by changing
weather patterns and increasing cost of carbon
emissions as we transition to a low carbon
economy (see Emerging Risk: Cost andavailability of ingredients and raw materials,
page 78) which may be passed on in additionalcosts to us.
Risk included in viability assessment:

Link to material issues:
Economic impact, sustainable sourcing
Strategic Growth Pillar:

Key drivers• Global macroeconomic conditions andinflationary pressures,• Ongoing geopolitical tensions, including Russia/
Ukraine crisis• Continuing supply chain volatility,• Impact of climate change over the longer term.

Consequences• Increased input costs putting pressure
on margins

Mitigation
In 2022, we:Outlook
Energy prices are expected to remain high during2023, increasing direct operating expenses• managed pricing volatility for hedgeable raw
and flowing through to higher ingredient costs.
materials through hedging/fixing of forward prices;
We expect to see continuing volatility in the short• utilised established protocols under our Treasury
to medium term. Commodity market prices are& Procurement Policies;
expected to be mixed with continuing high prices• introduced a hedgeable energy component inof sugar but the price of PET reducing, together
commodities contracts;with reducing ocean freight costs.
• provided reporting and visibility;
Trajectory:• and sought advice from the Financial Risk
Management Committee and the Audit and Risk
Committee of the Board.
Metrics and targets
Focus for 2023
Percentage of contracts hedged/fixed, input costs Continue monitoring key indicators and manage
per unit casevolatility under our current policies andprogrammes.

63

64

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Principal risk: Foreign exchange fluctuations
In 2022, we continued to see foreign exchange
volatility and rate fluctuations, particularly in the
Russian rouble, Nigerian naira and Egyptian pound.
Risk included in viability assessment:

Key drivers• Macroeconomic conditions• National instability and government responses
to global and domestic economic conditions,particularly in Russia, Nigeria and Egypt• Possibility of global recession in 2023

Link to material issues:
Economic impact
Strategic Growth Pillar:
Consequences• Financial losses and increased cost base• Asset impairment• Limitations on cash repatriation

Mitigation
In 2022, we:• maintained our target of hedging 25% – 80%of rolling 12-month forecasted transactional
foreign currency exposures as per treasury
policy, endorsed by the Board;• used derivative financial instruments,
where available, to reduce net exposure;• provided reporting and visibility;• and sought advice from the Financial Risk
Management Committee and the Audit and Risk
Committee of the Board.
Metrics and targets
Percentage of hedged foreign currency exposures,
foreign exchange losses

Outlook
We expect continuing short- to medium-term
volatility in key markets, particularly Nigeria andEgypt. There is a possibility of a global recession in
2023 as result of high inflation, high interest rates
and insufficient capacity to maintain government
support in many countries.
Trajectory:

Focus for 2023
Continue monitoring key indicators and manage
volatility under our current policies and programmes.

Principal risk: Marketplace economic conditions
In 2022, we continued to see increases in inflationand interest rates across our markets. These
conditions may reduce consumer purchasing
power, which may impact the affordability of our
products. This is particularly relevant when input
costs are increasing and, to maintain profitability,
we need to increase prices.

Key drivers• Challenging economic conditions• Government and central bank responses
including taxation and interest rate increases• Unemployment and underemployment rates• Aggressive discounting and/or pricing pressure
from large retailers• Price elasticity

Risk included in viability assessment:

Link to material issues:
Economic impact
Strategic Growth Pillar:

Consequences• Volume and revenue decline• Reduced profitability

Mitigation
In 2022, we:• used pricing and targeted actions to drive mix
as critical tools to manage cost inflation;• carefully managed operational expense andcost controls;• managed cash out flows;• developed coordinated and targeted plans with
TCCC and other business partners on promotions
and marketing initiatives; and• continued monitoring of conditions andadjustment of action plans.
Metrics and targets
Organic revenue growth, operating expenses,
profitability

Outlook
We expect challenging economic conditions tocontinue in the short term as central banks
increase interest rates to manage inflation, theRussia/Ukraine crisis continues and China struggles
to manage COVID-19 outbreaks in early 2023.
There is a possibility of a global recession in 2023.
Trajectory:

Focus for 2023
Continue to monitor key economic indicators ineach market and adjust plans as required.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Principal risk: Geopolitical and security environment
In 2022, our concerns were clearly centred on
the Russia/Ukraine crisis. In Ukraine our focus
was and remains the safety of our people first,
and the resumption of our production anddistribution where it was safe to do so. In Russia,
the decision by The Coca-Cola Company tocease operations and economic and othersanctions imposed by many countries, had asignificant impact on our business. The security
environment in Nigeria remains volatile in the lead
up to national elections in early 2023. Tensions
remain in the Balkans and Armenia and these led
to incidents that had the potential to affect thesafety of our people and disrupt our operations.
Risk included in viability assessment:

Key drivers• Russia/Ukraine crisis and potential for expansion
into other countries• Continuing political unrest and social instability
in several countries including Nigeria, theBalkans, Armenia• Social discontent driven by continuing tougheconomic conditions

Mitigation
In 2022, we:• enhanced security risk assessments to better
inform management plans;• developed emergency and contingency plans for
all potentially affected markets;• continued IMCR development and training inbusiness units and at Group and ELT level.

Outlook
We expect continuing volatility over the short
to medium term. While the situation remains
unpredictable, we do not expect a resolution of theRussia/Ukraine crisis in the short term. Continuing
tough economic conditions in the short term
will increase the risk of social discontent andpolitical instability.
Trajectory:

Consequences• Safety of our people• Financial impact of economic and other sanctions• Potential for business disruptions• Supply chain instability

Metrics and targets
Reduced impact of security-related incidents,
reduction in residual risk levels, number of IMCR
validations successfully completed.

Link to material issues:
Employee wellbeing and engagement
Economic impact
Strategic Growth Pillar:

Risk management in action
Enhancing our risk-based approach tosecurity & emergency management
While this was part of our five-year businessresilience improvement plan that commenced
in 2020, the volatile geopolitical environment
served to drive greater urgency into theenhancement of our risk-based approachto security and emergency management
plans in 2022.

to develop their capabilities and enhance
processes for the development of assessmentsin the Geopolitical and security environment
risk category. At the Group level, the businessresilience team developed a template thatmirrored and informed our existing ERM process
as well as additional requirements for collection
and analysis of internal and external data to
support the accuracy of those assessments.

The Group business resilience team worked
closely with our Risk and Security Leaders andfunctional managers across our business units

Our risk and security leaders facilitated theprocess at country level, engaging with a broad
range of internal and external stakeholders indevelopment of the assessments that were
calibrated by the Group business resilienceteam. In markets assessed as higher risk, notably
those bordering Ukraine, our risk and security
leaders focused on building sensible management
and contingency plans for protecting our people
and the continuity of our business.
In 2023, we will continue to update theseassessments and use them to review and adjust
management plans consistently at the country
and plant level.

Focus for 2023
Continuing development of our cross-functional
business resilience programmes, particularly
in capability development.

65

66

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Leveraging our unique 24/7 portfolio –and responding to change
Principal risks trend

Risk included in
viability assessment

Increasing
StableLink to growth pillars

Decreasing

1

2

3

4

Principal risks:• Product relevance and acceptability• Strategic stakeholder relationships• Competing in the digital marketplace5

To maintain true business resilience, we need tocontinue to evolve our portfolio of products androutes to market. To do that, we need to maintainstrong relationships with our partners, constantly
monitor and respond to changing consumer
preferences, customer needs and the businessand regulatory environment. In 2022 we faced
significant challenges but adapted our businessto respond to those challenges while keeping ourlong-term objectives firmly in sight.

Principal risk: Product relevance and acceptability
Key drivers• Changing consumer sentiment,• Actions of public health advocates and NGOs
• Government responses to health issues andclimate change at EU and national levels

In 2022, debates around sugar and sweeteners,
as well as discussion on appropriate responses
to key environmental, social and governanceconcerns increased the potential for regulatorychange and imposition of additional taxes.
Despite these concerns, ensuring we have highly
relevant and high-quality products that continue
to delight consumers while balancing the ongoingand emerging health and environmental concerns
remains a significant opportunity for our business.
This risk is closely linked with climate change risks,particularly the Principal risk: The cost andavailability of sustainable packaging (see page
Consequences75) and the Emerging risk Impact of climate• Discriminatory taxeschange on our reputation (see page 79).
• Brand and reputation damage
Risk included in viability assessment:• Financial impact• Forced changes in product formulations
and portfolio mix
Link to material issues:
Corporate citizenship, responsible marketing,nutrition, economic impact, product quality,
food loss and waste
Strategic Growth Pillar:

Mitigation
In 2022, we:• continued product innovation and expansionof our 24/7 portfolio to respond to consumer
needs, including expansion of low- andno‑sugar beverages;• took a proactive approach in partnership withkey stakeholders to better understand andaddress concerns;• focused strategy on proactive advocacy withassets repository and BU support plans in place;• developed and implemented Group-wide
assessment tool.
Metrics and targets
ESG reputation scores, calorie reduction targets,
Mission 2025 targets

Outlook
Increasing risk of additional sugar/beverage taxes
in the short term. Heightening concerns particularlyaround sustainability and the impact of climatechange into the medium to longer term. The EU
regulatory environment will increasingly focus on
health and sustainability issues and new directives
and regulations are likely. There is significant
opportunity for growth in getting the balance right.
Trajectory:

Focus for 2023
Continuing proactive approach in partnership withkey stakeholders to better understand and addressconcerns. Key sustainability projects such as the
packaging mix of the future.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Principal risk: Strategic stakeholder relationships
It is critical that we remain aligned with our key strategic partners such as The CocaCola Company, Monster Energy, Costa coffee and premium spirits manufacturers.
In 2022, the Russia/Ukraine crisis resulted in The Coca-Cola Company making thedecision to stop sales of its brands in Russia, which had a significant impact on ourbusiness there. Despite this, our relationship with all our strategic partners, including
The Coca-Cola Company remains strong, reflected in the announcement of the
expected renewal, strong marketing support across our territory and close collaboration
and alignment on our sustainability initiatives. Our relationships with our key partners
is important for our sustainability agenda and our response to climate change,
particularly in new products and formulations and pack mix. This risk is closely linked
with climate change risks, particularly the cost and availability of sustainable packaging
and impact of climate change on our reputation (see pages 75-79).
Risk included in viability assessment:

Strategic Growth Pillar:

Link to material issues:
Economic impact, corporate governanceKey drivers• Potential for disagreements
between independent businesses
when strategic objectives are
not aligned• Different environments, including
regulatory environments, in which
our partners operate and broader
global priorities• The impact of climate change andneed for collaboration on new
formulations and pack mix
Consequences• Financial impact• Damage to Coca-Cola System andbrand reputation

Mitigation
In 2022, we:• maintained establishedprocesses, routines, andcommunication channels tomanage strategic relationships
at the most senior levels;• closely monitored agreed
business indicators defined
during business planning and toanalyse deviations so that
corrective actions could betaken when needed.
Metrics and targets
Organic revenue growth

OutlookGiven the importance of our key partner
relationships over the long term and thechanging global environment which may
impact our independent businesses differently,
we continue to focus on maintaining aligned
strategic objectives.
Trajectory:

Focus for 2023
We will maintain our close working relationshipwith our strategic partners to ensure weremain aligned. We will continue to collaborate
on our key sustainability initiatives particularly
our packaging mix of the future project.

Principal risk: Competing in the digital marketplace
In 2022, the digital marketplace continued to evolveand remained highly competitive with new and existing
companies seeking to take advantage of e-commerce
growth. In 2022, we saw 59% growth (year on year)
in e-retail and food delivery service sales.

Key drivers• Dominance of large e-commerce platforms• Proliferation of new and existing playerswith varying business models• Growing consumer preference for speed
and convenience of online purchases

Mitigation
In 2022, we:

Consequences• Significant opportunity to grow sales andmarket share through well-developed andexecuted e-commerce strategies• Potential to lose market share or fail totake full advantage of growing
e-commerce market• Potential for new business models andventures to fail

Metrics and targets% active e-customer coverage,
revenue and market share on leading
e-commerce platforms, number ofactive customers on customer
portal, revenue generated on B2B
platforms, share of B2B orders
generated digitally

Link to material issues:
Economic impact, responsible marketing
Strategic Growth Pillar:

Given the rapidly changing environment including
the proliferation of new and existing players andevolving business models, we expect the risks
and opportunities to remain significant for theforeseeable future. We consider Competing in
the digital marketplace as an emerging risk.

• continued to build and invest indigital commerce capabilities andsystems to enhance our B2B,
e-retail, food service aggregatorand direct to consumer pillars;• continued to evolve our model for
direct-to-consumer routes tomarket in selected countries.

Outlook
We expect the continued strong growth of B2B and B2C
e-commerce sales over the medium to long term.
Trajectory:

Focus for 2023
Drive active e-customer coverage and enhance regular data
sharing. Strengthen relationships with leading e-commerce
platforms. Enhance our collection and analysis of data to accelerate
our revenue and market share growth via data-based decisions.
Accelerate systematic efforts to raise digital capabilities in our corebusiness teams ensuring that digital transformation of our businessmodel is keeping pace with the evolution of our market andcompetitive landscape.

67

68

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Maintaining operational excellence in volatile markets
Principal risks trend

Risk included in
viability assessment

Increasing
StableLink to growth pillars

Decreasing

1

2

3

4

5

In 2022, the macroeconomic and geopoliticalenvironment combined with regional and national
issues created volatile operating conditions in ourmarkets. The Russia/Ukraine crisis created safety
risks for our people and disrupted establishedsupply chains across our territory. Our people
adapted quickly to these volatile conditions tomanage safety challenges, maintain business
operations to continue to serve our customers
and achieve excellent results.

Principal risks:• Health and safety• Suppliers and sustainable sourcing• Cyber incidents• People retention• Ethics and compliance

Principal risk: Health and safety of our people
In 2022, the risks associated with
COVID-19 reduced as less severe strains
became more dominant and governments
continued to roll out vaccination programs,
including booster shots. We saw spikes
during the winter season in countries
in the southern hemisphere of not only
COVID-19 but also influenza. Increased
hygiene measures adopted during the
COVID-19 period saw drastically reduced
influenza rates compared to previous
years and the 2022 winter season in
the southern hemisphere witnessed asignificant return. We will continue tomonitor COVID-19 and influenza rates
closely.
Link to material Issues:
Employee wellbeing and engagement
Strategic Growth Pillar:

Key drivers• New variants of COVID-19 being reported• Impact of winter on COVID-19 and influenza cases• Vaccination rates, including booster programsin our markets• Non-compliance with or breaches of Health and
Safety requirements

Consequences• Fatalities and/or serious injury of employees,
contractors, third parties, and membersof the public• Potential for business interruption with higher
than normal absentee rates in certain positions

Mitigation
In 2022, we:• refined a number of our pandemic protocols basedon learnings across the Group and remain ready to
re-impose those protocols should case rates
increase significantly,• Increased focus on mental well-being in our employee
assistance programme• Continued implementation of our Behaviour Based
Safety (BBS) program• Enhanced end to end contractor management process• Involved leaders on all levels in H&S observations andH&S conversations• Ensured compliance lifesaving rules incorporated
in cross country verification program.
• H&S management system certification.
Metrics and targets• Fatalities• Lost Time Accident (LTA) rates• Absentee rates• Case rates per 100 FTE vs country rates

Outlook
We remain optimistic that COVID-19 and influenza
cases will remain manageable over the short term
but remain vigilant and ready to reintroduce
protocols if required.
Trajectory:

Focus for 2023
• Closely monitor reported COVID-19 andinfluenza rates across our countries andcontinue to enhance our pandemic response
protocols based on lessons from previous years
and best practice sharing.
• Continue to enhance our business continuity
program which includes preparing for andresponding to pandemics.
• Work closely with leadership teams in business
units with highest LTA’s to refresh BBS
programme and strengthen the safety cultureof our employees and contractors.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Principal risk: Suppliers and sustainable sourcing
In 2022, the macroeconomic environment, theRussia/Ukraine crisis, China’s COVID zero policy
and supply-demand imbalances continued tocreate challenging conditions for securing supplyof key ingredients, packaging and services at areasonable cost. This risk is closely linked withclimate change risks, particularly cost andavailability of sustainable packaging, the impact ofclimate change on the cost and availability of key
ingredients and impact of climate change on our
reputation (see pages 78-79).

Key drivers• Global macroeconomic conditions and supply
chain disruptions• Increased financial speculation on global
commodities• Hard currency liquidity issues• Supply/demand imbalances and/or crop yields• Russia/Ukraine crisis and effects on European
gas and oil prices flowing through to increased
raw material costs• Impact of climate change over the longer term

Mitigation
In 2022, we:

Consequences• Production disruptions• Failure to meet contractual obligations• Increased input costs and margin pressure• Energy availability and cost

Metrics and targets• COGS per case
• % sustainably sourced agricultural ingredients

Risk included in viability assessment:

Link to material issues:
Sustainable sourcing, economic impact, climatechange, biodiversity, food loss and waste• contracted volumes of key ingredients& packaging materials;• contracted prices with focus on local currency
wherever feasible;• ensured hedgeable contracts and introduced
hedgeable energy component;• expanded our supplier base and introduced new/alternative suppliers;• secured raw materials for suppliers to provide
security of supply;• developed contingency plans with suppliers due
to energy risks and risk mapping with our
production areas; and• investigated alternative and sustainableenergy options for long-term availability andpricing stability.

Outlook
We expect continuing volatility in the short-tomedium term as a result of macroeconomic andgeopolitical conditions and continuing supplydemand imbalances. Over the longer term we
expect climate change and our suppliers’ response
to climate change to affect the cost of ingredientsas noted in Emerging risk: The cost andavailability of ingredients and raw materials(see page 78).
Trajectory:

Strategic Growth Pillar:

Given the increasing requirements for supply
chain transparency and consequent evolutionof the regulatory environment as well as
the potential impact of climate change,
Suppliers and sustainable sourcing is also
an emerging risk.

Focus for 2023
Collaborating with our key suppliers to manage
volatility and maintain continuity. Continuing
discussions to better understand challenges to key
ingredient supply as a result of climate change and
ESG performance. Enhancing our risk monitoringin areas that may affect commodity availability
and pricing.

69

70

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Principal risk: Cyber incidents
In 2022, we saw continuing cyber-attacks
against government operations and companies
in many of our markets. Many of these incidents
were linked to the Russia/Ukraine crisis, althoughseveral known actors continued to conduct highprofile ransomware attacks. Organisations suchas Europol and several US agencies continued toenhance their capabilities to investigate, preventand respond to cybercrime which also helps toreduce risk to companies such as ours.
Link to material Issues:
Economic impact, corporate governance,
corporate citizenship
Strategic Growth Pillar:

Key drivers• Increasing use of cloud-based
IT solutions and working fromhome increasing exposure• Increasing sophistication of
malware and ransomware actors• Adoption of Industry 4.0
technologies in plants• Russia/Ukraine crisis

Mitigation
In 2022, we:

Consequences• Operational disruptions andfinancial losses• Damage to corporate reputation• Potential for release of personaland customer data
• Non-compliance with dataprotection legislation

Metrics and targets
Cyber security maturity level, cyber-attacks
detected and prevented• Certified our Information Security Management
System against ISO27001• Enhanced our protection of cloud resources• Improved network security in our plants
through network segmentation and moresecure remote access• Enhanced our privileged access management
and identity protection controls

OutlookThe number and sophistication of cyber incidents is expected toincrease in the short-to-medium term. Stakeholder concerns aboutdata privacy and requirements to protect it will continue to increase.
Government agencies will continue to improve their capabilities toinvestigate and respond to cybercrime.
Trajectory:

Focus for 2023
• Engage recognised leader in cyber defence to help us further
identify cyber risks in critical infrastructure and implement strategy
to strengthen our defences• Continue implementing internationally recognized security
hardening standards to decrease our vulnerabilities to cyber attacks• Improve plant security by design in alignment with IEC 62443

Principal risk: People retention
In 2022, we saw vacancies in some specific areas although our overallturnover rates improved to 11.4% in 2022 from 13.1% in 2021. We continue
to see challenges in the attractiveness of consumer packaged goods
companies as an employer of choice. The COVID-19 period has led topeople reviewing their work situations and relationship with their employer
and like many companies we have seen some resignations as we returned
to a ‘new normal’, that included balanced home/office working
arrangements. Our people have appreciated this flexibility and maintained
their productivity and engagement. Our engagement score remained
stable at 85%. We noted higher turnover rates for female employees andsought to understand the causes and address them. By the end of 2022,
retention rates amongst women had stabilised in key markets.
Link to material issues:
Employee wellbeing & engagement; human rights, diversity & inclusion;
Corporate citizenship
Strategic Growth Pillar:

Key drivers• Changing expectations for flexible
working arrangements• Maintaining value proposition as an
employer of choice• Development of technology and online
tools to enhance team engagement

Consequences• Failure to attract and retain people
to meet our goals• High turnover in critical positions
resulting in knowledge andproductivity loss
• Potential imbalance between maleand female employees due to different
retention rates

Mitigation
In 2022, we:• continued to leverage continuous listening to measure
culture and engagement and address findings;• improved people management skills to enhance
engagement and energise employees sustainably,
including how to manage remote teams;• maintained our leadership development programme andcontinued to foster our coaching and mentoring culture;• implemented action plans to improve retention of
female employees.
Metrics and targets
Retention rate, engagement score

Outlook
Talent retention will be an
ongoing challenge over the
short-medium term as
adjustments are made to
new ways of working.
Trajectory:

Focus for 2023
As described on page 39,
we will roll out our new,refined purpose in 2023
including a new culture
manifesto and leadership,with the principle to simplify
processes and make ourpeople’s lives easier.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Principal risk: Ethics and compliance
In 2022, a raft of economic and other sanctions
imposed by many countries against Russia andBelarus increased the risk of inadvertent
non-compliance. In response, we enhanced ourscreening processes, particularly for suppliers
based in Russia, Belarus and Ukraine. The risk of
fraud against the Company, and non-compliancewith anti-bribery and corruption standards,
continued to be a focus area.

Key drivers• The Russia/Ukraine crisis and the international
response• Potential for broadening of sanctions• Continuing levels of real and perceived corruption
in some countries that we operate within,including our newly acquired business in Egypt• Tougher economic conditions that increase therisk of internal and external fraud

Link to material issues:
Corporate governance
Strategic Growth Pillar:

Consequences• Damage to our reputation• Significant financial penalties• Increased management time and effort toresolve incidents• Financial loss

Mitigation
In 2022, we:• enhanced our monitoring of economic and othersanctions imposed against Russia and Belarus;• enhanced our risk assessment and screening
processes, particularly for suppliers andcustomers in Russia, Belarus and Ukraine;• updated our Sanctions Policy and enhanced oursanctions training programme; and introduced
a Recusal Policy to provide additional guidance
to employees;• continued training our people and ran additionalawareness initiatives on our Code of BusinessConduct and Anti-Bribery and Corruption Policy;• continued monitoring our Speak Up! hotline andother avenues for reporting concerns involving
potential violations of all of our policies andensured all allegations were investigatedin accordance with our policies;• internal audit team continued to focus oncompliance and internal controls.
Metrics and targets
Percentage of employees trained, resolutionof Speak Up! reports, audit reports

Outlook
We expect the international sanctions environment
to remain complex in the short to medium term.
Given we operate in a number of countries where
the perception of corruption is high, we expect thisrisk to remain significant for the foreseeable future.
Trajectory:

Focus for 2023
Completing the Egypt compliance integration
plan implementation, including introductionof a cross-functional joint taskforce. Continued
strengthening of our Code of Business Conduct,
Anti-bribery and corruption and sanctions
compliance programmes, taking a riskbased approach.

71

72

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Managing the risks and opportunities of climate change
Principal risks trend

Risk included in
viability assessment

Increasing
StableLink to growth pillars

Decreasing

1

2

3

4

5

In 2022, we continued to assess risks to ourbusiness associated with climate change withthe addition of comprehensive quantitative
assessments on managing our carbon footprint,
and the potential impact of increasing extreme
weather events on our production and distribution.
We continued to invest in key sustainability
initiatives to reduce our carbon footprint, our use
of water and move to more sustainable packaging.

Principal risks:• (T1) The cost and availability ofsustainable packaging• (P4/T4) Water availability and usage• (T2) Managing our carbon footprint
The following risks associated with climate change
are emerging risks:• (P2/P3) Impact of extreme weather
on production and distribution• (P1) Impact of climate change on thecost and availability of ingredients• (T3) Impact of climate change on our
reputation
Climate change is having and will have a significant
impact our business in a number of ways. Given
the longer term nature of climate risks and thenumber of variables – many of which we have nocontrol over, we need to continually update ourassessment and management of risks associatedwith climate change as more accurate data
becomes available and organisations around theworld respond to its effects.
Many of the risks associated with climate change
are common across the global Coca-Cola system.
We therefore take a system approach to theassessment of climate risks and leverage the work
being done by The Coca-Cola Company andbottlers around the world, to manage those risks.
The Coca-Cola system has identified 8 risks– 4 physical risks and 4 transitional risks; that arecommon to the Coca-Cola system. As depictedon the pictogram on page 74, they are:Physical risks:• (P1) The effect of changes to weather patternson the cost and availability of key ingredientsand raw materials• (P2) The effect of extreme weather eventson our production• (P3) The effect of extreme weather eventson our distribution• (P4) The effect of increasing water scarcity
on our production
Transition risks:• (T1) The effect on the cost and availabilityof sustainable packaging materials as a resultof changing government regulations• (T2) The effect of increasing regulations on
GHG emissions on our costs of production
and distribution• (T3) The effect of consumer perceptionsof our environmental performance on our
corporate reputation• (T4) The effect of increasing government
regulation on the cost and availability of water
We have fully integrated the assessment andmitigation of these physical and transitional risks
associated with climate change into our ERM
programme, which underpins our robust approach
to all risks to our business. In the following pages,
we have provided more detail on the assessmentand management of those climate-related risks
identified as principal risks and those identified as
emerging risks.

We analyse our internal data and work withrecognised specialist agencies, our insurance
brokers and insurers to obtain regional analysisof the potential impact of climate change.
This helps us make informed decisions andimproves our understanding of the potential
climate vulnerabilities in our operations and thecommunities in which we operate. This data andresulting analysis is shared across our business
units, supporting climate resilience across ourplanning and operations.

Taskforce for Climate-related
Financial Disclosures (TCFD)
The Taskforce on Climate -related Financial
Disclosures (TCFD) is an important framework forreporting climate-related risks and opportunities.
We considered the 2021 TCFD “Implementing
Guidance” for All sectors and the Beverage sector
in our disclosures which can be found throughout
this report. The table on page 80-81, provides
a summary on where those disclosure scores canbe found and how the information is consistent
with the TCFD recommendations.

For additional information on our climate-related
disclosures, see our 2022 CDP submission online.

Governance
As noted from page 94 onwards, governanceof all risks including climate change risks, isthe responsibility of our Board and specificallythe Audit and Risk Committee and the Social
Responsibility Committee, following a clearly
defined structure and process from business
units, to Group, our ELT and the Board.

Strategy
Given the longer-term nature and the implicationsof climate change, our response to climatechange transcends all areas of our strategy andoperations. Our future packaging mix for example
has significant implications for our business given
the substantial capital investments in our plants
and routes to market needed to make significant
packaging changes. Changes needed to meet our
NetZeroby40 commitments and the impact ofclimate change on the availability and cost of key
ingredients have implications for our supplier baseand our distribution systems. Our response to
climate change has a significant impact on our
reputation with key stakeholders and ultimately

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Managing risk and materiality continued
our ability to attract and retain people, attract
capital, and the willingness of consumers to buy
our products.
While there are numerous costs associated withmanaging climate change risks, we also recognisethat there are significant opportunities for ourbusiness in continuing to meet the needs andexpectations of our stakeholders. As noted in“Impact of climate change on our reputation” (seepage 79), there is a strong correlation between
consumers perception of how we are responding
to climate change and their intent to purchase our
products. The longer-term structural changes
inherent in our sustainability strategy is embedded
in our business strategy, which is constantly
reviewed as our understanding of the potential
effects of climate change risks and opportunities
improves, to ensure our business remains resilientand focused on growth.

Risk assessment
As noted, we take a global system approach to theidentification, assessment, and management ofclimate-related risks. The Coca-Cola System– which consists of The Coca-Cola Company andits bottling partners of which CCHBC is one of thelargest, has identified eight potentially material
risks relating to the physical and transitional
impact of climate change on our business.
These are depicted in the diagram on page 74.
In 2021, we focused our attention on acomprehensive quantitative assessment of ourwater risk given the fundamental importance ofwater to our business. This was updated in 2022
(see Principal Risk: Water Availability and Usageon page 76). In 2022, we also enhanced ourunderstanding of climate-related risks byconducting comprehensive quantitative
assessments of a number of other potentiallymaterial risks including the impact of extreme
weather events on our production and distribution(see “Impact of extreme weather on production
and distribution” on page 78). In 2021 weannounced our commitment to NetZeroby40– the primary means by which we will manage thePrincipal risk: Manage our carbon footprint, to2040. In 2022, we conducted a comprehensive
quantitative assessment of this risk, the resultsof which are summarised on page 78.

Metrics and targets
We use clear metrics and targets in theassessment and management of all of our risks inorder to continually measure risk drivers, thepotential impact – including financial impact ofrisks and key performance indicators to ensure weare managing risks effectively. These are noted
under “Metrics and Targets” for each risk. Many of
our climate change metrics and targets are also
outlined in our Mission 2025 and NetZeroby40
commitments.
Given the longer term nature of managing
climate-related risks, our allocation of capex will be
important in meeting our sustainability targets. We
have been increasing our investment in initiatives
designed to mitigate the risks associated withclimate change. In 2022, we invested €206 million
in CAPEX initiatives aligned with our sustainability
strategy, which represents 35% of our total
CAPEX. We are planning to increase our allocationof our annual CAPEX to investments aligned with
our sustainability strategy, expecting to reach 40%
of CAPEX by 2025 and 50% of CAPEX by 2030.
This demonstrates our commitment to manage
climate-related risks using a gradual, well thought
out program of capital expenditure over the
medium to long term based on our assessmentof the risks to our business and stakeholders.

Coca-Cola HBC Integrated Annual Report 2022

73

74

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued
The impact of climate change risk

Cause

Agriculture andPackaging
Manufacturing
ingredients
Estimated share of carbon emissions

Risk

28%

34%

11%

Distribution

Cold drink
equipment

6%

21%

Business impacts: Physical risks of climate change (Risks P1-4)
Changes to weather P1: Cost andavailability
and precipitationof ingredients andpatterns
raw materials
ExtremeP2: Impact ofweather events
extreme weather
on production.
P3: Impact of
extreme weather
on distribution
Water scarcity

P4: Water
availability andusage

GHG regulation

T1: Cost andavailability ofsustainable
packaging
T2: Managing ourcarbon footprint

Stakeholder
perceptions of oursustainability
performance
Water regulation

T3: Impact on our
reputation

Business impacts: Risks of transition to a low-carbon economy (Risks T1-4)

For more details on these eight risks, please see
previous pages 75-79.

T4: Water
availability andusage

Customers andcommunities

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Principal risk: Cost and availability of sustainable packaging
Given the potential impact that significant changes to our
packaging mix could have to longer-term capital
investment in production and distribution, and theinfluence that packaging has on our ability to meet our
NetZeroby40 commitments – packaging represents 34%
of our emissions, the management of risks associatedwith the cost and availability of sustainable packaging isintertwined with our future business strategy. It is closely
linked with other Principal risks, particularly Managing ourcarbon footprint (see page 77). In 2022, we continued
to work on our plans for the packaging mix of the future.
The development of a profitable packaging strategy
that reduces our environmental impact and addresses
escalating stakeholder concerns relating to packaging
waste also represents a significant opportunity for ourbusiness. In November 2022, the EU released draft
regulations that provide minimum requirements forreusable and recycled packaging.
Link to material issues:
Packaging and waste management, sustainable sourcing,biodiversity
Strategic Growth Pillar:

Key drivers• Price increases of recycle-friendly raw materials
such as rPET and aluminium• Low collection rates in high plastic volume markets• Low access to quality feedstock to enable shift
to rPET at balanced prices• New EU regulations on Plastics & Packaging Waste• Impact of packaging on meeting our
NetZeroby40 commitments• Consumers’ concerns on waste and its influenceon perceptions of our environmental performance

Consequences• Impact on reputation and ultimately
consumer base
• Increased operating costs, taxes and Capexcosts associated with changing packaging mix• Very significant opportunity associated with
developing innovative, profitable solutions

Mitigation
In 2022, we:• focused on meeting Mission 2025
commitments including increasing our overall
Group packaging collection rate andincreasing the amount of recycled PET usedin our bottles;• partnered with governments and industry
peers to support the launch of two new
deposit return schemes in Latvia and Slovakia
and a establishing a new Packaging Recovery
Organisation in Moldova;• awarded our first €100K Coca-Cola HBC
Sustainability Challenge to a start-up with aninnovative solution for collecting andrecycling PET.
Metrics and Targets
Mission 2025 targets relating to collection of
packaging, use of recycled PET and percentageof packaging that is recyclable

Given the rapid changes in technology and theevolution of the regulatory environment, and thesignificant impact that major changes in our packaging
mix have for our NetZeroby40 commitment andour future business strategy, Cost and availabilityof sustainable packaging is also an emerging risk.

* Note: We had intended to conduct a quantitative assessment in 2022 however the release of the new EU Packaging legislation – which could
have a material impact on that assessment was only released at the end of November 2022 and is to be debated before being adopted in 2023.

Outlook
We will continue to see heightened stakeholder
concerns over the medium term and increased
regulation across EU markets. The price ofgood quality recycled material will continue torise over the medium term as industries focus
on increasing recycled content.
Trajectory:

Focus for 2023
Start ‘packaging mix of the future’ journey toaccelerate decarbonisation of our packaging
while connecting these changes withrevenue growth.
Include a quantitative assessment* of the risk
and opportunity of changing our pack mix underat least two different climate change scenarios.

75

76

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Principal risk: Water availability and usage
In 2021 we conducted a comprehensive
quantitative assessment of our future waterrequirements under current conditions and under
two different projected climate change scenarios
up to 2040. In 2022, we updated that assessment
based on revised data due to revised volume
estimates and updates to our True Cost of Water
metric. Egypt was not included in the assessment
for 2022 but will be included in the 2023
assessment. Availability and quality of clean wateris fundamental to our business and for the local
communities in which we operate.
Risk included in viability assessment:

Link to material issues:
Water stewardship, sustainable sourcing,biodiversity, climate change
Strategic Growth Pillar:

Key drivers• 7 countries and 19 plants (water priority
locations) that are likely to come under increased
water stress with climate change• Local community needs for clean water,
particularly in areas of water stress• Increased regulatory pressure, including
imposition of taxes and levies, designed toreduce water usage and/or fund additional
infrastructure

Consequences• Insufficient water to service our needs and theneeds of the local community• Increased annual baseline water costs by up to
48% by 2030 and 39% by 2040 and arequirement for an additional €95.6million incapital expenditure over the next 17 years tomeet our needs and to replenish watersheds for
local communities in water priority areas• Damage to our reputation

Mitigation
In 2022, we:• continued to implement water usage reductionplans across our operations;• implemented water stewardship programmes
in water priority locations to mitigate sharedwater risks;• updated source vulnerability assessments for all
plants and enhanced our plans, including
identification of additional capital expenditure
required for enhancing infrastructure.

Metrics and Targets
Reduce water usage by 20% by 2025, Number ofwater availability projects in water risk areas
implemented (target = 19)

Outlook
We expect that water stress in our water priority
locations will continue to increase over the medium
to long term . The extent of that increase will
depend both on our actions and on the global
response to climate change. We expect that
regulatory pressure will increase over the medium
term and that will flow through to additional
operating costs associated with water that we haveestimated in our assessment.
Trajectory:

Focus for 2023
In 2023 we will further implement innovations to
reduce our water usage, particularly in waterpriority locations. We will complete the inclusion ofwater usage data for our Egyptian plants in ourwater risk assessment. We will implement
additional community water projects to help securewater availability for local communities in an
additional four locations.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Managing risk and materiality continued

Risk in focus: Managing our carbon footprint
In 2021, we announced our commitment to NetZeroby40 –the primary means by which we will manage the principal risk:
Managing our carbon footprint, to 2040. In 2022, we conducted
a comprehensive quantitative assessment of the risks
associated with managing our carbon footprint.
Coca-Cola HBC, like most large manufacturing and distribution
businesses, has a significant carbon footprint. This is made up of:• scope 1 emissions, which are direct emissions of CO2 andother greenhouse gases (GHG) from our manufacturing
operations which represents around 5.4% of our total
emissions,• scope 2 emissions, which are indirect emissions resulting frompurchased electricity and thermal energy in our operations
which represents around 5.4% of our emissions,• scope 3 emissions, which are indirect emissions generated
either downstream in the use of our products such as use ofcoolers, third-party logistics to deliver products; or upstream
by our suppliers in ingredients and packaging, which
represents around 89.2% of our emissions.
In 2022, we took and will continue to take major steps forward
in reducing energy, switching to renewable energy and moving
to recycled packaging. For further information on our carbon
reduction efforts, please see ‘Climate and NetZero’ on page 48.
Our biggest opportunities for reducing our carbon footprint isworking with our suppliers and customers to reduce our scope 3
emissions, which represent 89% of our total emissions.
Risk included in viability assessment:

Link to material issues:
Climate change, sustainable sourcing, packaging and waste
management, biodiversity
Strategic Growth Pillar:

Key drivers• Impact of high emissions on global warming
and subsequent climate change• Increasing consumer focus on the carbon
footprint of company’s they purchase from• Government use of carbon taxes or carbon
markets to encourage emissions reduction
increasing costs related to our emissions• Increasingly ambitious reduction goals under
different climate scenarios• community perceptions of corporate“greenwashing”

Consequences• Annual operating costs of our projected scope 1
and 2 carbon emissions:– estimated to peak around €43 million annuallyby 2030, reducing to €6 million annually by
2040 under a Paris Ambition (RCP 1.9)
scenario,– estimated to peak around €21 million annuallyby 2030, reducing to €2 million by 2040 undera RCP 4.5 scenario• Significant opportunity in increased consumer“intent to purchase” and sales in meeting or
exceeding stakeholder expectations• Significant opportunity in enhanced “willingness
to invest” by investment community and“willingness to work for” in current and future
workforce• Capex costs of emissions reduction initiatives(see page 73 for estimated Capex investments
associated with sustainability initiatives)

Mitigation
In 2022, we:• Strategic sustainability approach –long‑term climate targets: 2030 carbon
targets validated and approved by
Science Based Target initiative (SBTi);
NetZeroby40 commitment andimplementation;• Environmental management system
certification.
• Sustainable packaging mix of the
future project,• Connect revenue growth management
initiatives with carbon footprint.
• Continuing enhancement of theintegration of climate related risks andopportunities into strategic planning.
• Contingency plans developed to support
transition to alternative fuel sources
Metrics and Targets
NetZeroby40 targets including annual
carbon emissions against target pathway,
Mission 2025 targets, cost of carbon (taxes,
trading schemes), renewable energy usage,
energy efficient coolers.

Outlook
We will continue to see heightened
stakeholder concerns andincreased regulation across EU
markets over the medium term.
We expect greater scrutiny of ourprogress against our NetZeroby40
commitments. We will gradually
increase our investment insustainability initiatives over the
short – medium term, investing
50% of our total Capex annuallyby 2030.
Trajectory:

Focus for 2023
In 2023 we will continue to drive ouremissions reductions initiatives andrefine our assessment of the risks
and opportunities associated withmanaging our carbon footprint,
including the integration of key risk
areas such as sustainable packaging
mix and cost and availability ofingredients and raw materials as
contributors to our meeting andexceeding our emissions targets.
We will continue to fully integrate
Egyptian operations to CCH climate
plans, understand their impact anddefine relevant action plans.

77

78

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Managing risk and materiality continued

Emerging risk: Impact of extreme weather on our production and distribution
Risk included in viability
assessment:

Link to material issues:
Economic impact,biodiversity, climatechangeStrategic Growth Pillar:

In 2022 we conducted a comprehensive assessment of thepotential impact of two different climate change scenarios(RCP4.5 and RCP8.5)1 relating to extreme weather on ourplants using credible insurance industry data. We
specifically assessed projected increases in flood risk,increase in likelihood of wildfires, increased precipitationand drought.
We assessed data relating to 62 locations and identified 19
plants that we considered high risk and requiring capex tomitigate risks associated with extreme weather. Of thosenineteen, fourteen facilities are considered high risk overthe short term, and subject to current mitigation planning.
Five were assessed as requiring additional capex as a resultof climate change over the medium to long term.

We have estimated that one-off capex requirements tomitigate the impact of extreme weather including theimpact of climate change between now and 2030, is €27
million. We expect increases in insurance premiums as aresult of insurance underwriters considering our facilities
higher risk of extreme weather. The SwissRe Institute has
estimated that insurance premiums may increase by 40%
for fire and 25% for flood and precipitation. Assuming
insurers apply those premium increases against facilities
considered to be at risk, and not across the board, we
have estimated potential annual increases in insurance
premiums as a result of climate change to be approximately€1.5million per annum by 2050 under an RCP4.5 climate
scenario or by 2030 under an RCP8.5 scenario.

During 2022 we started an assessment of the potential forincreases in cost of working as a result of businessinterruption across all plants for any reason, not justclimate change. Given the complexity of the exercise, we
expect to complete this assessment in 2023. Our initial
review of plants at risk through climate change has
estimated those costs are unlikely to be material.

Emerging risk: Impact of climate change on the cost and availability of ingredients and raw materials
Link to material issues:
Sustainable sourcing,food loss and waste,climate change
Strategic Growth Pillar:

In 2022, we started developing our model for assessing theimpact of climate change on the cost and availability ofingredients particularly corn and sugar as the baseingredients for our natural sweeteners, fruit as the base forour juice products, coffee and tea. We expect to work
closely with our key suppliers in 2023 to refine the modeland populate it with climate change data to conduct a
more comprehensive assessment.
Although we did not conduct a quantitative assessment in
2022, according to information from The Coca-Cola
Company’s qualitative assessment of its global suppliers,
climate change is likely to cause rising temperatures andheat stress, increased precipitation and drought insourcing regions over the medium to long term.

These environmental factors will impact productivity andcrop yields, and ultimately may increase the cost base of
these key ingredients. Although many sourcing regions, areat medium/high risk in a high carbon scenario (worst casescenario), drought is the only one that is projected to havea major impact, with tea, beet sugar and apple juice andcane sugar regions considered to have a high sensitivity to
climate change in a high-carbon scenario by 2050. Coffee
and lemon growing regions are considered medium to highrisk of heat stress. Corn is considered lower risk.

While we are concerned about the impact of climatechange on ingredients as all companies in the food andbeverage industries are, physical risks are more likely tohave an impact over a longer timeframe. We have more
opportunity to better understand the potential impact andfind ways of adapting to changing conditions and create
appropriate contingency plans. We also see the continuing
strong trend towards low- and no-sugar beverages, whichmeans that risks associated with sugar and corn for example
are significant, but we are confident that they are manageable.

The TCCC assessment noted that the majority of growers
are conducting their own assessments and developing
contingency plans that include identification of alternative
regions for supply.

Over the medium to long term, all parts of the supply chain
will be expected to reduce their carbon footprint which
increases their operating costs and need for investment incarbon reduction initiatives. This is likely to increase thecost of ingredients and raw materials, as suppliers look topass on at least some of those costs. This could lead to anincrease in our input costs.

1. As part of our assessment, we reviewed RCP1.9 (‘Paris Ambition’) and RCP2.6 (‘Paris Agreement’) and concluded that given a number of our facilities are already at risk under current conditions and the impact of RCP4.5 and RCP8.5 were assessed as moderate,
there is currently not enough data to conclude that either RCP1.9 or RCP2.6 will have a material impact of the risk on our facilities. We will revisit both RCP1.9 and 2.6 as part of our planned update of the assessment in 2023.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Managing risk and materiality continued

Emerging risk: Impact of climate change on our reputation
Link to material issues:
Climate change,sustainable sourcing,packaging and waste
management, corporate
citizenship, responsible
marketing
Strategic Growth Pillar:

In 2022, we developed and started populating a model for
estimating the impact on our reputation of meeting or not
meeting the expectations of key stakeholder groups on
progress on our environmental performance. Our materiality
assessment shows that our response to various aspects ofclimate change is already a key concern and this is likely togrow over the medium to longer term. We consider three
key stakeholder groups:• current and future employees and their willingness towork for us which could ultimately impact our ability to
attract and retain talented people• investors and their willingness to invest in us which could
impact our cost of capital• consumers and their willingness to purchase our
products
Of those three groups, we determined that employees andinvestors were generally aware of our environmental
performance through external ESG benchmarking
programmes such as DJSI where we were recently named
as the most sustainable beverage company in the world.

Our review of general consumer data across a selection of
our markets however indicated that consumers were notas convinced of our environmental performance and wechose to concentrate our assessment on this group.
Our assessment included a measure of the perceptions ofgeneral consumers in eight selected markets of ourenvironmental performance in comparison to our peers
and other companies in the consumer goods sectors, of
our Environmental reputation – or ‘E-score’. These studies
indicated that an increase in E-score led to an increase in
the likelihood of consumers to purchase creating an
opportunity for our business and conversely a decrease inE-score increased the likelihood that consumers do notintend to purchase our products. Intent to purchase scores
was used to determine the impact on our business of
meeting, exceeding or failing to meet expectations.

Our assessment indicates that, like many large companies
in the food and beverage sector, there is currently a highlikelihood that consumers perceive we are not meeting
expectations in environmental performance and that thoseperceptions are creating an opportunity cost for us. The
assessment also allows us to quantify the potential
opportunity of meeting and exceeding consumer
expectations.

79

80

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Managing risk and materiality continued

Location of disclosures consistent with TCFD recommendations
In disclosing information related to the risks and opportunities associated with climate change, we considered the 2021 TCFD Implementing Guidance for all sectors and the beverage sector.
Governance: Disclose the Company’s governance around climate-related risks and opportunities
Consistency statusa) Describe the Board’s
oversight of climate-relatedrisks and opportunitiesa) Fully consistent
The role of the Social Responsibility Committee of the Board for oversight of climate-related risks and opportunities is described in pages 126-127
The role of the Audit and Risk Committee of the Board for oversight of all principal and emerging risks, including climate-related risks is outlined in the section“Work and Activities” on pages 119-120 and “Risk Management” on pages 121-122.

b) Describe management’s
role in identifying, assessing
and managing climate-relatedrisks and opportunities

Our Materiality assessment, on page 58 in the section “Managing and disclosing material issues” describes the Executive Leadership Team’s role in managing
risks and opportunities and integrating sustainability initiatives into our business strategy.

b) Fully consistentManagement’s role in identifying, assessing and managing all risks, including climate-related is outlined “Managing Risk and Resilience on pages 61-62,
and further described specifically relating to climate-related risks in “Managing climate change risk”, pages 72-79

Strategy: Disclose the actual and potential impacts of climate-related risks and opportunities on the Company’s business, strategy and financial planningwhere materiala) Describe the climaterelated risks and opportunities
that the organisation has
identified over the short,medium and long termb) Describe the impact ofclimate-related risk andopportunity on the Company’sbusiness, strategy andfinancial planninga) Fully consistent
The section “D: Managing climate change risk” on pages 72-79 provides a detailed description of the Principal and Emerging risks and opportunities thatthe company has identified over the short, medium and long term associated with climate change, andSection C2.3 and C2.4, on pages 11-17 of our 2022 CDP Climate response, describes a number of risks and opportunities associated with climate changethat the Company has identified.
The section “D: Managing climate change risk” on pages 72-79 describes the impact of each of the Principal and Emerging risks and opportunities relatedwith climate change and the consequences and mitigation actions including impact on the Company’s business, strategy and financial planning
The impact of climate-related risks and opportunities on our business and strategy and the financial planning changes in managing those risks andopportunities is described in “Earn our licence to operate” particularly page 49 (carbon emissions), page 50 (sustainable packaging) and page 52(water stewardship).
Section C3.3 and C3.4 on page 21 of our 2022 CDP Climate response describes how our assessments of climate-related risks and opportunities haveinfluenced our strategy and financial planning.

c) Describe the resilience ofthe organisation’s strategy
considering different
climate‑related scenarios,
including a 2-degree or
lower scenario

The section “D: Managing climate change risk” on pages 72-79 describes our assessment of the impact of each of the Principal and Emerging risks
and opportunities associated with climate change and how the Company is mitigating those risks and opportunities.

b) Work in progress – qualitative impact has
been completed for the whole value chain,along with a quantitative assessment ofsome elements however, more work will bedone to get a better understanding of the
impact on business, strategy and financial
planning through more holistic scenario
planning exercises in 2023.
c) Work in progress – work has been
completed using multiple scenarios,
including “Paris Ambition” (1.5 degree)
related to physical and transitional risks
associated with the impact on water
availability and costs, the impact of extreme
weather events on our production, andmanaging our carbon footprint and how
these impact our strategy. More work will
be done in 2023 on the impact of otherelements of climate change, particularly thecost wand availability of key ingredients andraw materials and the cost and availabilityof sustainable packaging which have asignificant impact on our strategy.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Managing risk and materiality continued

Location of disclosures consistent with TCFD recommendations
Risk management: Disclose how the Company identifies, assesses and manages climate‑related risks and opportunitiesa) Describe the Company’s
process for identifying andassessing climate-relatedrisks and opportunitiesa) Fully consistent“Managing risk and resilience” on page 61-62 provides an overview of the Company’s process for identifying all risks and opportunities including those relating
to climate change, and“Managing climate change risk”, on pages 72-73 describes those processes specifically relating to the Principal and Emerging risks and opportunities related
to climate change.
Section 2.1a, 2.1b and 2.2a on page 8 and 10 of our 2022 CDP Climate response describes the process for identification of the climate-related risks andopportunitiesb) Describe the Company’s
process for managing
climate-related risks andopportunities“Managing climate change risk”, on pages 72-79 describes how the company is managing the risks and opportunities specifically relating to climate change,
particularly in the “Mitigation”: and “Focus for 2023” sections for each of the Principal and Emerging risks and opportunities.

c) Describe how theseprocesses are integrated into
the overall risk management
programme“Managing risk and resilience” on page 61-62 provides an overview of how the Company has embedded the assessment of the risks and opportunities
associated with climate change into its enterprise risk management programme.

b) Fully consistent

Key performance indicators on pages 57-58 relating to the “Earn our licence to operate” pillar describe how the Company is managing climate-related risks
and opportunities.
c) Fully consistent“Managing climate change risk”, on pages 71-72 further describes how the company has integrated each of the Principal and Emerging risks andopportunities related to climate change into its enterprise risk management program, and pages 73-77 provides an overview of the outcomes of thatprocess relating to each climate-related risk and opportunity.

Metrics and targets: Disclose the metrics and targets used to assess and manage climate-related risks and opportunitiesa) Disclose the metrics usedby the organisation to assessclimate-related risks andopportunities in line with
its strategy and risk
management processa) Fully consistent“Managing climate change risk”, on pages 73-77 provides metrics and targets relating to each of the Principal and Emerging risks and opportunities
associated with climate change in the “metrics and targets” section, andKey performance indicators on pages 57-58 relating to the “Earn our licence to operate” pillar (Mission 2025 commitments), and the sections relating to“NetZeroby40” on pages 48-49, Sustainable packaging on page 50 and water stewardship on page 52 describe the metrics and targets the Company is using
to assess climate-related risks and opportunities in line with our strategy and risk management process, andSection C4.1 and C4.2 on pages 22-28 of our 2022 CDP Climate response lists a number of metrics and targets used to assess climate-related risks andopportunities.

b) Disclose Scope 1, Scope 2,
and, if appropriate, Scope 3
greenhouse gas (GHG)
emissions, and therelated risks

NetZeroby40 target across the whole value chain charts on page 49 show our Scope 1, 2 and 3 GHG emissions, andb) Fully consistent

The Principal risk: Managing our carbon footprint” on page 77 describes how we are managing the risks and opportunities associated with our emissions,
Section C5.2 pages 32-36 and Section C6, pages 36-44 of our 2022 CDP Climate response provides further detail on Scope 1, 2 and 3 emissions and therisks associated with them.
In the 2022 GRI Content Index, in the environmental table on page 51 and as part of the disclosures 305-1 (page 26), 305‑2 (page 26), and 305-3 (page 27)
provides details of our GHG emissions.

c) Describe the targets usedby the organisation to manage
climate-related risks andopportunities andperformance against targets“Managing climate change risk”, on pages 73-77 describes targets relating to each of the Principal and Emerging risks and opportunities associated withclimate change in the “metrics and targets” section, andKey performance indicators on pages 57-58 relating to the “Earn our licence to operate” pillar (Mission 2025 commitment), and the sections relating to“NetZeroby40” on pages 48-49, Sustainable packaging on page 50 and water stewardship on page 52 describe the metrics and targets the Company is using
to assess climate-related risks and opportunities and our performance against those targets, andSection C4.1 and C4.2 on pages 22-28 of our 2022 CDP Climate response lists a number of metrics and targets used to assess climate-related risks andopportunities.

c) Fully consistent

81

82

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Viability statement

Viability statement
Business model and prospects
Our business model and strategy, outlined on
pages 14-23 of this report, documents the key
factors that underpin the evaluation of ourprospects. These factors include our:• attractive geographic diversity;• strong sales and execution capabilities;• ability to innovate;• market leadership;• global brands; and• diverse beverage portfolio.

The conflict between Russia and Ukraine had asignificant impact on the global supply chain,foreign exchange rates and input costs including
raw materials and energy. Economic sanctions
imposed on Russia by the US, UK and EU as well as
many other countries remain in place, while
counter sanctions were imposed by the Russian
government in retaliation. On 8 March 2022, The
Coca-Cola Company announced the suspensionof its business in Russia which had a significant
impact on our business. We have considered thepotential future implications of the conflict in our
financial forecasts to the extent possible.

The Board considers that our markets will facechanges over the medium to longer term but
continues to believe that our diverse geographic
footprint, including exposure to emerging markets
that have low per capita consumption andtherefore greater opportunity for growth, and aproven strategy in combination with our leading
market position, offer significant opportunities for
future growth.
Our Board has historically applied and continues toapply a prudent approach to the Group’s decisions
relating to major projects and investments. From2018 to 2022, we generated free cash flow of€511 million per year on average.

Key assumptions of the business planand related viability period
The Group maintains a well-established strategic
business planning process which has formed thebasis of the Board’s quantitative assessment of
the Group’s viability, with the plan reflecting ourcurrent strategy over a rolling five-year period.
The financial forecasts in the plan are based onassumptions for the following:• key macroeconomic data that could impact
our consumers’ disposable income andconsequently our sales volume and revenues;• various scenarios relating to the ability of
governments in key markets to manage theeconomic conditions in their countries;• key raw material and other input costs;• the impact of climate change under multiple
climate scenarios (see also page 78 for more
information on our quantitative assessmentsof the impact of climate change. In addition
to 2030 and 2040, we also included interim
calculations to 2027 for the purpose of our
viability assessment);• the impact of the Russia-Ukraine conflict,including loss of sales volume and revenues asa result of TCCC’s suspension of its operations
in Russia;• foreign exchange rates; including the economic
conditions affecting the Egyptian pound, theNigerian Naira and the impact of the RussiaUkraine conflict;• spending for production overhead andoperating expenses;• working capital levels; and• capital expenditure.
The Board has assessed that a viability period offive years remains the most appropriate. This isdue to its alignment with the Group’s strategic
business planning cycle, consistency with theevaluated potential impacts of our principal risks
as disclosed on pages 63-76 and our impairment
review process, where goodwill and indefinitelived intangible assets are tested based on our
five-year forecasts.

Assessment of viability
Qualitatively and quantitatively, we analysed theoutput of our robust enterprise risk management,internal business planning and liquidity management
processes, to ensure that the risks to theGroup’s viability are understood and are being
effectively managed.
The integration of the Coca-Cola Bottling Companyof Egypt (CCBCE) progressed significantly during2022. Considering the successful outcomes of
the integration process in the year, no risks to theGroup’s viability over the five-year period of thisassessment have been identified as a result of theacquisition and integration of this business.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Viability statement continued
The Board has concluded that the Group’s
well-established processes across multiple
streams continues to provide a comprehensive
framework that effectively supports theoperational and strategic objectives of the Group.
It also provides a robust basis for assessment andconfirmation of the Group’s ability to continue
operations and meet its obligations as they fall due
over the period of assessment.
Supporting the qualitative assessment was aquantitative analysis performed as part ofstrategic business planning. This assessment
included, but was not limited to, the Group’s ability
to generate cash.
We have continued to stress test the plan against
several severe but plausible downside scenarios
linked to certain principal risks as follows:
Scenario 1
The impact of changes to foreign exchange rates
was considered, particularly the depreciation offoreign currencies including the Egyptian pound,
Nigerian Naira and Russian Rouble, also
considering effects from the Russia-Ukraine
conflict. Principal risks: Foreign exchange
fluctuations, Commodity costs and Geopoliticaland security environment.
Scenario 2
Lower estimates for sales volumes for various
reasons including the continuing difficult
economic conditions in our markets and the abilityof governments to manage these, including theimpact of the continued Russia-Ukraine conflict.
Principal risks: Marketplace economic conditions,and Geopolitical and security environment.

Scenario 3
Continued stakeholder focus on issues relating tosugar and packaging resulting in the potential for
discriminatory taxation. Principal risks: Productrelevance and acceptability, and Cost andavailability of sustainable packaging.
Scenario 4
Higher input costs including raw material andenergy costs. Principal risks: Commodity costs,
Suppliers and sustainable sourcing, andMarketplace economic conditions
Scenario 5
Higher costs of water, carbon and extreme
weather as a result of the effects of climatechange under multiple climate scenarios, as well as
the increased capital expenditure required tomitigate risks associated with climate change.
Principal risks: Water availability and usage,
Managing our carbon footprint, Impact of extreme
weather on our production and distribution(Emerging risk).
The above scenarios were tested both in isolationand in combination. The stress testing showedthat due to the stable cash generation of ourbusiness, the Group would be able to withstandthe impact of these scenarios occurring over theperiod of the financial forecasts. This could be
conducted by making adjustments, if required, toour operating plans within the normal course ofbusiness, including but not limited to adjustments
to our operations and temporary reductions in
discretionary spending.

Following a thorough and robust assessment of
the Group’s risks that could threaten our businessmodel, future performance, solvency or liquidity,
the Board has concluded that the Group is well
positioned to effectively manage its financial,
operational and strategic risks.

Viability Statement
Based on our assessment of the Group’s
prospects, business model and viability as outlined
above, the Directors can confirm that they have areasonable expectation that the Group will be able
to continue operating and meet its liabilities as
they fall due over the five-year period ending 31
December 2027.

83

84

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Financial review

ANOTHER YEAROF STRONG
FINANCIALPERFORMANCE“Another year of strong
financial performance,
while navigating achallenging
macroeconomic andgeopolitical backdrop.”
Ben Almanzar
Chief Financial Officer

Dear Stakeholder,I’m very pleased with another year of strong
financial performance. Our resilience is testament
to the foundations we have put in place and thehard work of colleagues across the business.
We have well and truly stepped up our performancein the last two years with 2022 revenues 28%
ahead of 2019 levels on an organic1 basis.
Just like the broader industry, we have been
wrestling with sharp inflation across our COGS
lines and have used every tool at our disposal tosuccessfully manage these headwinds, leading torecord Comparable EBIT1 performance and free
cash flow. I’m also really proud of the team for
issuing our first-ever green bond for €500 million,
which was very well received by investors andsupports our ongoing commitment to being
leaders in sustainability.

1. For details on APMs refer to ‘Alternative Performance
Measures’ and ‘Definitions and reconciliations of APMs’sections on pages 245-249.

Coca-Cola HBC Integrated Annual Report 2022

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Financial review continued
Income statement
Consistently strong top-line performance
We closed the year with good top-line momentum
leading to net sales revenue growth of 28.3% in
2022, compared to the prior year, driven by pricing
initiatives and mix improvements, supported byfavourable foreign currency movements as well as
the consolidation of Egypt and Multon. Organic
revenue growth was 14.2%, including Russia andUkraine. Excluding these two markets organic
growth was 22.7%. Volume growth was 8.1%
excluding Russia and Ukraine on an organic basis,
with our priority categories as the best performing.
Pricing was the largest contributor to revenue percase, accounting for approximately two thirds ofthe improvement in the period. The remaining one
third came from mix levers, led by package andcategory mix.
Managing significant cost inflation in 2022
2022 was dominated by inflation and supply chain
challenges. Just like the broader industry, we havebeen wrestling with sharp inflation across our
COGS lines. Raw materials, packaging and finishedgoods were adversely impacted by inflation acrossall major commodities. These were amplified byembedded higher energy prices, resulting inincreased conversion costs. Our own production
and haulage costs were affected by labourand energy inflation across our markets. And
concentrate costs also increased as revenue
per case expanded.
Comparable cost of goods sold1 increased by
32.3% in 2022, driven by the consolidation of
Egypt and Multon, as well as energy and input cost
inflation. Comparable operating expenses1
increased by 25.7% in 2022 mainly driven by higher
selling, delivery and administrative expenses
and the consolidation of Egypt and Multon; while
operating expenses increased by 28.4% in 2022
compared to the prior year further impacted byacquisition and integration costs associated withthe business combinations of Egypt and Multon.

Marketing spend was up 11.5% year on year,(excluding Russia and Ukraine). We are fully fundingnewer categories such as Coffee, making big bets
in digital and data as well as investments to deliver
our sustainability agenda – all in service of ourvision of being The Leading 24/7 Beverage Partner.
Organic EBIT up 1.3% despite cost inflation
As a result of our focus on costs and discipline,
organic EBIT was up 1.3% despite cost inflation.
We are proud of that performance given thechallenging macroeconomic backdrop,compounded by the war in Ukraine.
Comparable operating profit grew by 11.9%
in 2022, reflecting the benefits from theconsolidation of Egypt and Multon and mix
improvements, which were only partially offset
by higher input costs and operating expenses.
Operating profit deteriorated by 11.9% in 2022,
compared to the prior year period, as thebenefits described were more than offset by
the impairment losses net of reversals related
to Russia, and acquisition and integration costs
associated with the business combinationsof Multon and Egypt.
Net finance costs increased by €15.1 million
during 2022 compared to the prior year, mainly
driven by higher interest expense due to theconsolidation of Egypt and increased hedging
cost of borrowings in Nigeria as well as higher net
foreign exchange losses, which were only partially
offset by higher interest income.
On a comparable basis, the effective tax rate
was 26.4% for 2022 and 24.5% for 2021. On areported basis, the effective tax rate was 33.4%
for 2022, mainly impacted by the impairment
losses relating to the Group’s operations in Russia,
and 25.5% for 2021.

€500 million green bond
In September 2022, we issued our first evergreen bond for €500 million in support ofour ambitious sustainability projects. Behind
every bond issuance is a highly committed
and passionate finance team. This team was
passionate about embedding sustainability
into financing the business, as outlined in theGroup’s Green Finance Framework.

The funds will accelerate progress of our
NetZeroby40 and Mission 2025 commitments,
including innovation in sustainable packaging,energy efficiency, water stewardship,
biodiversity and community programmes.
Investing in these projects means we continue
to make tangible progress on sustainability andsupports our goal of remaining a leader here.

The bond was oversubscribed and we secured
attractive rates, allowing us to turn short-term
funding into mid-term funding at a time ofrising interest rates.

Key financial information
Volume (million unit cases)
Net sales revenue (€ million)
Net sales revenue per unit case (€)
Operating profit (EBIT)2 (€ million)
Comparable EBIT1 (€ million)
EBIT margin (%)
Comparable EBIT margin1 (%)
Net profit (€ million)
Comparable net profit1,3 (€ million)
Comparable basic earnings per share1,3 (€)

2022

2021

% Reportedchange2,711.8
9,198.4
3.39
703.8
929.7
7.7
10.1
415.4
624.9
1.706

2,412.7
7,168.4
2.97
799.3
831.0
11.2
11.6
547.2
578.1
1.584

12.4
28.3
14.2
-11.9
11.9
-350bps-150bps
-24.1
8.1
7.7

Percentage changes are calculated on precise numbers.

1. For details on APMs refer to ‘Alternative Performance Measures’ and ‘Definitions and reconciliations of APMs’ sections.
2. Refer to the consolidated income statement.
3. Net profit and comparable net profit refer to net profit and comparable net profit respectively after tax attributable to owners of the parent.

85

86

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Financial review continued
Balance sheet
AssetsTotal non-current assets
Total current assets
Total assets
Liabilities
Total current liabilities
Total non-current liabilities
Total liabilities
EquityOwners of the parent
Non-controlling interests
Total equity
Total equity and liabilities

Organic revenue growth year on year2022
€ million

2021€ million

6,139.5
3,716.2
9,855.7

5,357.4
3,156.9
8,514.3

3,006.7
3,463.4
6,470.1

2,516.4
2,880.8
5,397.2

3,282.3
103.3
3,385.6
9,855.7

3,114.5
2.6
3,117.1
8,514.3

Comparable net profit grew by 8.1% versus theprior-year period, due to higher operating
profitability, while net profit contracted by 24.1%,
largely due to the net impairment losses after tax,
relating to the Group’s operations in Russia, andacquisition and integration costs associated withthe business combinations of Egypt and Multon.

Net current assets increased by €69.0 million
largely driven by the consolidation of Multon,
higher investments in financial assets and lower
current borrowings, partially offset by higher trade
payables. Total non-current liabilities increased by€582.6 million during 2022, mainly due to the new
green bond which was issued in September 2022.

Strong and flexible balance sheet

Another year of investment and record
free cash flow generation

Our balance sheet remains very strong. Prudent
financial management of our balance sheet is asource of strength and flexibility, providing ample
capacity for investments both organically andthrough M&A.
Total non-current assets increased by €782.1
million during 2022, mainly driven by the
consolidation of Egypt, Multon and Three Cents,
as well as continued investment in property, plantand equipment, which was only partially offset by
impairment losses for property, plant andequipment, goodwill and equity method
investments in connection with our operations in
Russia and foreign currency translation impact.

Capital expenditure (Capex)2 increased by €48.6
million in 2022 as we continue to deploy capital
into critical growth projects. In particular, we areinvesting behind upgrading our manufacturing
facilities in selected markets, expanding our baseof energy efficient coolers to drive single-serve
growth and delivering our sustainability goals.
Capex finished at 6.4% of revenue, slightly below
our guided range, following suspension of capex
investment in Russia in 2022. Free cash flow
increased by €43.8 million year on year to €645.1
million – a record high for our company.

14.2%
Comparable EBIT

€929.7m
Organic EBIT growth year on year

+1.3%

Borrowings
At the close of the year net debt to comparable
EBITDA was 1.2 times. The business is wellinsulated from interest rate exposure by having
most of our debt on fixed rates. Our next bondrepayment is not due until November 2024.

Dividend
The Board of Directors has proposed a dividendof €0.78 per share, a 9.9% increase from the€0.71 per share dividend paid in 2021, continuing
the Group’s progressive dividend policy, andreflecting the strength of its balance sheet andhealthy liquidity position, The pay-out ratio is 46%,
within the updated target pay-out ratio of 40
to 50%. The dividend payment will be subject
to shareholders’ approval at our Annual
General Meeting.

Cash flow
Cash flow from operating activities
Payments for purchases of property, plant and equipment1
Proceeds from sales of property, plant and equipment
Principal repayments of lease obligations
Free cash flow2022
€ million

2021€ million

1,234.6(531.8)7.5(65.2)
645.1

1,142.2(513.6)35.8(63.1)
601.3

1. Payments for purchases of property, plant and equipment for 2022 include €8.4 million (2021: €7.1 million) relating to repaymentof borrowings undertaken to finance the purchase of production equipment by the Group’s subsidiary in Nigeria, classified as‘Repayments of borrowings’ in the consolidated cash flow statement.
2. For details on APMs refer to ‘Alternative Performance Measures’ and ‘Definitions and reconciliations of APMs’ sections.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Financial review continued
Continued strong ROIC performance
Return on Invested Capital (ROIC) is one our mostimportant KPIs. To be The Leading 24/7 BeveragePartner we need to make thoughtful choices,
ensuring that we deploy capital efficiently andeffectively in the service of profitable growth. We
delivered another year of good ROIC performancedespite the challenging macroeconomic andgeopolitical environment.
Higher profits resulted in another strong
performance on ROIC of 14.1% (2021: 14.8%).
ROIC excluding Egypt was 15.8%.

Financial risk management
The Group’s activities expose it to a variety offinancial risks: market risk (including currency risk,interest rate risk and commodity price risk), credit
risk, liquidity risk and capital risk. There have been
no material changes in the risk management
policies since the previous year end.
The Group maintains its healthy liquidity position
and is able to meet its liabilities as they fall due.
As at 31 December 2022, the Group has net debtof €1.7 billion. In addition, as at 31 December
2022, the Group had cash and cash equivalents
and other financial assets of €1.7 billion, an
undrawn Revolving Credit Facility of €0.8 billion,
an uncommitted Money Market Loan agreementof €0.2 billion, as well as €0.8 billion available outof the €1.0 billion Commercial Paper Programme.
None of our debt facilities are subject to any
financial covenants that would impact the Group’s
liquidity or access to capital.
Effective financial risk management proved
successful in mitigating a material part of input
cost increases for 2022. In terms of foreignexchange risk, the Group is exposed to exchange
rate fluctuation of the Euro versus the US Dollar
and the local currency of each country of ouroperations. Our risk management strategy
involves hedging transactional exposures arisingfrom currency fluctuations, with available financial
instruments on a 12-month rolling basis.

As a matter of Group policy, translational
exposures are not hedged.

Looking ahead
While we remain attentive to macroeconomic andgeopolitical risks, we have high confidence thatour portfolio, capabilities, attractive markets andtalented people will allow us to continue to makeprogress on our strategy in 2023.
At our full year results presentation on 14 February
2023, we announced our full year guidance for theyear. We expect another year of organic revenue
growth above the 5 to 6% average mid-term
range guidance. While we have seen signs ofimprovement in some commodities, overall
inflation levels remain high and we expect COGS
per unit case to increase by low teens. Given thegood momentum, combined with our proactive
management of the P&L, we now expect organic
EBIT growth in the range of plus to minus 3%.
I am confident that our talented people, inpartnership with our customers, The Coca-Cola
Company, the Monster Energy team, and othervalued stakeholders, will continue to open up
moments to refresh us all in 2023 and deliver
another year of strong financial performance.

Taxes we contribute to ourcommunities
When considering tax, Coca-Cola HBC
gives due consideration to the importanceof earning community trust. More specifically,
we commit to continue paying taxes in the
countries where value is created and ensurethat we are fully compliant with the spirit aswell as the letter of tax laws and regulations
across all jurisdictions we operate in. In addition,
we commit to being open and transparent
with tax authorities about the Group’s tax
affairs and to disclose relevant information to
enable tax authorities to carry out their reviews.
We support the communities in the countries
where we operate directly, by creating
economic wealth, and also indirectly, by
paying taxes. These taxes include corporate
income tax calculated on each country’s
taxable profit, employer taxes and social
security contributions, net VAT cost andother taxes that are reflected as operating
expenses. Excise taxes and taxes borne byemployees are not included.

Total tax by category in 2022 (%)

Corporate income tax
Withholding tax
Payroll taxes
VAT (cost)
Environmental taxes
Other taxes

48.9%
2.2%
39.1%
3.2%
0.1%
6.5%

2022 Borrowing structure (€ m)€3,419.9 m

Ben Almanzar
Chief Financial Officer

Bonds issued
Commercial paper
LeasesOther

2,883.4m
167.5m206.0m163.0m87

88

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Financial review continued

Segment highlights
Established markets
In the Established segment, organic revenues
grew by 18.6%. Strong organic revenue per case
expansion of 8.6% was achieved throughimprovements in category and package mix, as
well as pricing actions throughout the year in all
markets. Volumes in the segment were robust,with volumes accelerating in H2 versus H1 on athree-year stack. All the main markets achieved
high single digit volume growth in 2022. We havebeen pleased with the strong performance on
package mix in the segment, with single serve mix
up 4.5 percentage points.

Organic volume growth

9.1%

Organic revenue per case growth

8.6%

Volume (million unit cases)
Net sales revenue (€ million)
Comparable EBIT (€ million)
Operating profit (EBIT) (€ million)
Total taxes1 (€ million)
Population2 (million)
GDP per capita (US$)
Bottling plants (number)
Employees (number)
Water footprint (billion litres)
Carbon emissions (tonnes)
Safety rate (lost time accidents >1 day
per 100 employees)

While Sparkling and Energy were the main growth
drivers in Established, we were also pleased by thestrong performance in some of the smaller Stills
categories. For example, Fuze Tea volumes grewover 20% in Italy.

Volume breakdown by country (%)

For the segment, comparable EBIT grew 1.3% on
an organic basis while operating profit increasedby 8.7%. As a reminder, in 2021 the Establishedsegment benefitted from a one-off property salein Cyprus, which we are lapping this year. Withoutit, comparable EBIT growth was up 9.5% on anorganic basis.

2022

2021

% change
reported% changeorganic

643.9
2,974.1
307.1
310.4
156.3
94
40,617
15
6,392
4.048
67,720589.9
2,479.0
300.8
285.6
130.7
94
39,487
15
6,251
3.751
65,568

9.2
20.0
2.1
8.7
19.6
–
2.9
–
2.2
7.9
3.3

9.1
18.6
1.3

0.69

0.44

56.8

1. Total taxes include corporate income tax, withholding tax and deferred tax, as well as social security costs and other taxes that arereflected as operating expenses; as per IFRS accounts.
2. Population source: International Monetary Fund, World Economic Outlook Database, October 2022.

Italy
GreeceAustria
Republic of Ireland and Northern Ireland
Switzerland
Cyprus

43%
18%
13%
13%
11%
2%

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Financial review continued

Developing markets
In the Developing segment, organic revenue grew
29.0%, benefitting from very good price/mix
expansion and sustained volume growth. All themain markets gained share and achieved
double-digit volume growth in the year led by
Sparkling and Energy.
We are also seeing success from our focus on
multi-packs of single serve, particularly in Poland
and Czech Republic.

Organic volume growth

15.2%

Organic revenue per case growth

11.9%

Volume (million unit cases)
Net sales revenue (€ million)
Comparable EBIT (€ million)
Operating profit (EBIT) (€ million)
Total taxes1 (€ million)
Population2 (million)
GDP per capita (US$)
Bottling plants (number)
Employees (number)
Water footprint (billion litres)
Carbon emissions (tonnes)
Safety rate (lost time accidents >1 day
per 100 employees)

Poland delivered excellent volume growth andwe continued to accelerate share gains, as thecategory recovered from the 2021 sugar tax.
Low/no sugar variants saw another year of robust
volume expansion.

Volume breakdown by country (%)

Developing segment comparable EBIT grew by
12.7% on an organic basis, while operating profit
grew by 8.0%.

2022

2021

% change
reported% changeorganic

478.8
1,719.7
115.1
113.1
66.0
76
17,824
9
4,157
3.557
47,779415.5
1,365.6
106.5
104.7
45.6
76
17,618
9
4,261
3.214
45,633

15.2
25.9
8.1
8.0
44.9
–
1.2
–
-2.4
10.7
4.7

15.2
29.0
12.7

0.46

0.47

-2.1

1. Total taxes include corporate income tax, withholding tax and deferred tax, as well as social security costs and other taxes that arereflected as operating expenses; as per IFRS accounts.
2. Population source: International Monetary Fund, World Economic Outlook Database, October 2022.

PolandHungary
Czech Republic
Baltics
Croatia
Slovakia
Slovenia

44%
21%
13%
8%
7%
5%
2%

89

90

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Financial review continued

Emerging markets
In the Emerging segment, organic revenue
finished up 5.5%. Top line growth was negatively
impacted by the war in Ukraine. Without Russia
and Ukraine, organic revenue grew by 23.5%– demonstrating the health of the non-affectedareas of the business.
Volume contracted 41% in Russia on an organic
basis, with most of that decline in the second half,
after the depletion of The Coca-Cola Company
brands in the market at the end of July. Whilevolumes were in steep decline, we saw a surprisingly
strong Rouble which generated transactional andOrganic volume growth-10.9%
Organic revenue per case growth

18.4%

Volume (million unit cases)
Net sales revenue (€ million)
Comparable EBIT (€ million)
Operating profit (EBIT) (€ million)
Total taxes1 (€ million)
Population2 (million)
GDP per capita (US$)
Bottling plants (number)
Employees (number)
Water footprint (billion litres)
Carbon emissions (tonnes)
Safety rate (lost time accidents >1 day per
100 employees)

translational currency benefits. FX, combinedwith the impact of consolidating Multon, meantthat Russia’s comparable EBIT was higher in 2022
than 2021.
In the Emerging segment as a whole, organic
volumes declined by 10.9%, but grew 4.3%, if we
exclude Russia and Ukraine. Segment revenue
per case expanded 18.4% on an organic basis as
we took decisive action on pricing and mix acrossall countries to manage inflation, and currency
weakness in selected markets. Segmental
comparable EBIT declined by 1.1% on an organic
basis, while operating profit declined by 31.5%.

2022

2021

% change
reported% changeorganic

1,589.1
4,504.6
507.5
280.3
185.0
543
5,735.7
38
22,4949.726
327,206

1,407.3
3,323.8
423.7
409.0
189.3
549
5,372.932
16,70010.721
314,582

12.9
35.5
19.8
-31.5
-2.2
-1.0
6.8
18.8
34.7
-9.3
4.0

-10.9
5.5
-1.1

0.21

0.14

50.0

1. Total taxes include corporate income tax, withholding tax and deferred tax, as well as social security costs and other taxes that arereflected as operating expenses; as per IFRS accounts.
2. Population source: International Monetary Fund, World Economic Outlook Database, October 2022. Population includes N. Macedonia.

Volume breakdown by country (%)

Nigeria
Egypt
Russian Federation
Romania
Serbia (including the Republic of Kosovo)
UkraineBulgaria
BelarusBosnia and Herzegovina
Armenia
Moldova

26%
18%
17%
13%
10%
6%
4%
3%
1%
1%
1%

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Non-financial reporting directive

Delivering 24/7 takes
an integrated approachThis spread constitutes our non-financial information statement.
The below information provides page references mapping out how ourreport complies with relevant regulation on non‑financial information.
This information is supplementary.

Our purpose

Policies and values

Effective oversightOpen up moments that refresh us all.
Serving as our north star ambition to guide
everything we do.

Underpinning our business and setting thedirection for how we achieve our goals.

Our Board and senior management ensure westay on course to achieve our vision.

Our purpose pages 1-6, 21-22

Values page 22• Customer first• Make it simple• We over I• Deliver sustainably

Policies (see our website)
Environmental matters• Environmental Policy• Climate Change Policy• Packaging waste management Policy• Principles for Sustainable Agriculture• Water Stewardship Policy• Biodiversity Statement

The purpose recognises thatwhile our work requires sealing
beverages in, the real magic
happens when they are opened up:
opening up new markets, newrelationships and new ideas fora better future.

Employees• Code of Business Conduct• Diversity and Inclusion Policy• Occupational Health and Safety Policy• Quality and Food Safety Policy

Human rights• Human Rights Policy• Supplier Guiding Principles• Slavery and Human Trafficking statement

The Executive Leadership Teampages 114-116

Social matters• Health and Wellness Policy• HIV/AIDS Policy• Code of Business Conduct• Supplier Guiding Principles• GMO position statement• Community Contributions Policy• Premium Spirits Responsible Marketing Policy• Public Policy Engagement Policy• Quality and Food Safety Policy
Anti-bribery and Corruption• Code of Business Conduct• Anti-bribery Policy and Compliance Handbook• Supplier Guiding Principles• Community Contributions Policy• Whistleblowing Policy
Principal risk
• Risk Policy

How our Board considers stakeholders
in decision making page 109
Social Responsibility Committee
pages 126-127

91

92

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Non-financial reporting directive continued
Positive influence

Executing our vision

Defining our successBeing conscious of stakeholders, risks, market
changes and material issues, while responding
through our business model in a positive way.

To fulfil our Growth Story 2025 we will executeon each of our five growth pillars, considering
all stakeholders at every step of the journey.

Operating in a sustainable way to ensure ourremuneration and sustainability commitments
are interlinked.

Business model pages 14-15

Growth pillars page 23

Remuneration report pages 128-155

Leverage our unique
24/7 portfolio
2 Win in the marketplace

The CEO’s individual performance is measured
in key strategic areas and taken into accountfor MIP. These strategic areas include theCompany’s performance in ESG benchmarks.
The Company received the highest scores in
8 of the 10 most recognised ESG benchmarks,
including DJSI, MSCI ESG, FTSE4Good, ISS
ESG, and V.E. The PSP contains metrics linked
to a reduction in CO2 emissions. The CO2
emissions target in the PSP implicitly captures
reduction in plastics, which was a key driverof its selection as a metric.
See pages 148-151

1

Fuel growth throughcompetitiveness andinvestment
4 Cultivate the potentialof our people
5 Earn our licence to operate3

CEO pay ratio
See page 152

Stakeholder engagement pages 16-18
Market trends pages 19-20• Regulatory environment• Sustainability

Principal risks pages 61-81
Material issues pages 59-60
GRI Content Index

Mission 2025 sustainability
commitments pages 57-58• Emissions reduction• Water reduction and stewardship• World Without Waste (Packaging)• Ingredient sourcing• Nutrition• Our people and communities

EU Taxonomy
We are committed to achieving net zero
emissions across our entire value chain by 2040
and we support the European Commission’s
action plan to redirect capital flows towards amore sustainable economy. The EU Taxonomy,
which is a key part of this action plan, introduces aclassification system for sustainable activities insupport of the EU’s Green Deal.
Under the EU Taxonomy, non-financial companies
are to disclose what percentage of their turnover,
CapEx, and OpEx meet its criteria. As a company
domiciled in Switzerland, Coca-Cola HBC is not
subject to the EU Non-Financial Reporting
Directive (NFRD) or required to report using the
EU Taxonomy. However, we have been voluntarily
complying with other requirements of the NFRD
since 2018.
In 2022, there were delays in the finalisation of the
EU Taxonomy delegation acts. At the time thisreport was written, the remaining four
environmental objectives of the EU Taxonomy– sustainable use and protection of water andmarine resources; transition to a circular
economy; pollution prevention and control; andprotection and restoration of biodiversity andecosystems – had not yet been published.
Thus, our disclosure regarding the EU Taxonomy
is consistent with our 2021 report. The primaryeconomic activity of the Group – manufacturingof beverages and food products – does not havethe potential to substantially contribute to climatechange adaptation and mitigation. In addition,no other taxonomy-eligible activities havebeen identified.
In 2023, we will remain alert to the evolving
EU legislation around corporate sustainability
disclosure requirements, and we will continue ourwork to maintain best-in-class ESG reporting.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

CORPORATEGOVERNANCE

Contents

Corporate Governance
94
98
101
128
156

Chairman’s introduction to corporate
governance
Board of Directors
Corporate Governance Report
Directors’ Remuneration ReportStatement of Directors’ Responsibilities

93

94

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Chairman’s introduction to corporate governance

Governing adaptationand change
Letter from the Chairman of the Board

Dear Shareholder
Our corporate governance reportfor 2022 details our robust governancearrangements throughout the Groupand the key activities and decisions
undertaken by the Board during theyear. Despite the impact of the conflict
between Russia and Ukraine, the Board
has remained focused on our Growth
Story 2025 to support the long-termsustainable success of our businessand our commitment to achieving net
zero emissions across the entire value
chain by 2040.
Conflict between Russia and Ukraine
The conflict between Russia and Ukraine continues
to affect our business in those countries with somecontinuing impact on our supply chain. We
prioritised the health and safety of our people in all
impacted countries and are providing practical andfinancial support, as well as donations forhumanitarian relief in the impacted region.
In March 2022, The Coca-Cola Company
announced the suspension of its business in
Russia, which has had, and will continue to have, animpact on our operations in Russia. Following thisdecision, we implemented a new operating modelin Russia, a self-sufficient business, selling local
brands. Economic sanctions imposed on Russia
have had a significant impact on foreign exchange
rates and the price of a number of commodities
such as oil, which affects PET prices, and aluminium.
Countersanctions imposed by Russia may have an
impact on our Russian operations as well as othercountries in our territory. We expect the geopoliticalenvironment to remain volatile for some time, but
we continue to position the Company to deal withthis continued volatility and most importantly toprotect our employees and their families throughpractical and financial support.

Coca-Cola Bottling Company of Egypt
In August 2021, we announced the acquisition of
the Coca-Cola Bottling Company of Egypt S.A.E.
(CCBCE), a leading producer of non-alcoholic
ready-to-drink beverages in Egypt. The
acquisition, which was completed on 13 January2022, provides access to one of the largest
non-alcoholic ready-to-drink markets by volume
in Africa. Since completion, our focus has been on
integrating the business financially, operationallyand from a governance perspective. The Board
has monitored the integration closely and hasreceived regular updates on progress.

Three Cents
In August 2022, we announced the acquisition of
ESM Effervescent Sodas Management Limited,the owner of the super-premium adult sparkling
beverage and mixer product line under the ThreeCents brand. This acquisition will strengthen our
premium brand offerings and was completed in
October 2022.

Green Bond
In September 2022, we successfully raised €500
million through the issue of our first green bond insupport of our ambitious sustainability projects.
The net proceeds of the green bond will beallocated to projects that meet the eligibility
criteria outlined in our Green Finance Framework.
They will accelerate progress of our NetZeroby40
and Mission 2025 commitments including:circularity, energy efficiency, water stewardship,
biodiversity and community programmes,
innovation in sustainable packaging and support ofsustainable agriculture and procurement. This
milestone initiative demonstrates how
sustainability is embedded in every aspect of ourbusiness, including our financing.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Chairman’s introduction to corporate governance continued“As always, we look to thelong-term potential of thebusiness to ensure that weare making the progressthat would make those who
passed its stewardshiponto us proud.”

Importance of good governance
As a Board, our aim is to always ensure the highest
standards of corporate governance, accountability
and risk management. Our internal policies andprocedures, which have been consistently
effective since the Group was formed, areproperly documented and communicated against
the framework applicable to companies with apremium listing in the UK.
The Board and its committees conducted anannual review of the effectiveness of our risk
management system and internal controls, further
details of which are set out in the Audit and Risk
Committee report on 118. The Board confirmsthat it has concluded that our risk management
and internal control systems are effective.
We are subject to the UK Corporate Governance
Code 2018. It sets out the principles of goodpractice in relation to: Board leadership andcompany purpose; division of responsibilities;
composition, success and evaluation; audit, risk
and internal controls; and remuneration. Further
information on how we have applied the principles
and complied with the provisions of the UK
Corporate Governance Code 2018 for the year
ended 31 December 2022 can be found in thisreport on 96.
Board meetings normally take place in Zug,
Switzerland, but also in selected markets acrossour territories.

Purpose culture and values
In early 2023, the Board endorsed the Company’s
revised purpose: opening up moments that
refresh us all. This revision provides greater clarity
and inspiration, and also supports our alignment
with the Coca-Cola system.
The long-term success of our business remains
connected to the success of our customers andpartners, and our ability to delight consumers withthe beverages and brands that they love. We areable to accomplish this due to our well-embedded,
values-based culture. The Board plays a criticalrole in shaping the culture of the Company bypromoting growth-focused and values-based
conduct and ensuring increased focus on continued
learning and the smart risk taking necessary
for the Company’s adaptation. The Board isoverseeing the development and implementationof a new culture manifesto and leadershipmodel, ensuring that the revised purpose iswell-embedded in the Company’s culture.
We monitor our progress in integrating our values
through various indicators, including our employee
engagement index, diversity indicators, and healthand safety indicators, and our Directors lead byexample as ambassadors of our values, cascading
good behaviour throughout the organisation.
As pandemic-related disruptions eased acrossour territory, but new challenges due to theconflict between Russia and Ukraine presented
themselves, we have maintained a level ofengagement with our people to ensure weunderstood their needs and challenges. One
all-employee pulse survey, one Engagement
survey and one Collaborating for Impact survey
were conducted in 2022. While Charlotte Boyleis our designated non-Executive Director
responsible for engaging with our people toprovide feedback to the Board, feedback fromour people through these surveys was brought tothe full Board’s attention in 2022 to facilitate
understanding of the concerns raised and ensure
a rapid response.

Board evaluation
In line with our commitment to adhere to best
corporate governance practices, an externallyfacilitated Board effectiveness evaluation was
conducted in the second half of 2022. We will dothis once again in 2023 to build upon the learningsof the 2022 evaluation. Key outcomes from theBoard effectiveness evaluation conducted in 2022
are included on page 112. Further details aredisclosed in the Nomination Committee reporton page 124.

Board composition and diversity
The composition and size of the Board continues
to be kept under review. We believe that our Board
is well-balanced and diverse, with the right mix ofinternational skills, experience, background,independence and knowledge in order todischarge its duties and responsibilities effectively.
We continue to attach great importance to all
aspects of diversity in our nomination processes
at Board and senior management levels, while
appointing candidates with the credentials thatare necessary for the continuing growth of ouroperations within our highly specialised industry.
We believe that having a diverse Board fosters
both innovation and resilience and are proud of
our track record of female representation. As ofthe date of this report, female Directors comprise
more than 30% of our Board.

Anastassis G. David
Chairman of the Board

95

96

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

UK Corporate Governance Code 2018

The UK Corporate
Governance Code 2018
As a Swiss corporation listed on the London Stock
Exchange (LSE) with a secondary listing on the
Athens Exchange, we aim to ensure that our
corporate governance systems remain in linewith international best practices. Our corporate
governance standards and procedures arecontinuously reviewed in light of current
developments and rulemaking processes in the
UK, Switzerland and also the EU. Further details
are available on our website.

In respect of the year ended 31 December 2022,
the Company was subject to the UK Corporate
Governance Code 2018 (a copy is available atwww.frc.org.uk).
Our Board confirms that the Company applied theprinciples and complied with the provisions of the
UK Corporate Governance Code throughout thefinancial year ended December 2022, except for
the following provisions: (1) The Chairman was notindependent on appointment (provision 9) and has

Section 1: Board leadership and company purpose

See pageA.

Effective and entrepreneurial Board to promote thelong-term sustainable success of the Company, generating
value for shareholders and contributing to wider society
B. Purpose, values and strategy with alignment to culture
C. Resources for the Company to meet its objectives andmeasure performance. Controls framework for
management and assessment of risks
D. Effective engagement with shareholders and stakeholders
E. Consistency of workforce policies and practices to support
long-term sustainable success•

Chairman’s letter

7

been a Board member for more than nine years(provision 19), and a full explanation for thisdeparture is provided on pages 97 and 102.
On appointment the Board unanimously
supported Anastassis David’s appointment as
Chairman. The Board regularly reviews Anastassis
David’s position and considers that he continues
to effectively lead the Board, his deep knowledgeof the Coca-Cola System is invaluable and as suchit remains appropriate for him to continue in hisrole as Chairman; and (2) Provision 38 requiresalignment of Executive Director pension
contributions with the wider workforce.
Our difficulties in compliance with this provision
due to existing contractual obligations were
outlined in the Annual Report published in 2021
and are explained on page 136 of the Directors’
Remuneration Report.

Section 2: Division of responsibilities

See page

F.
G.
H.
I.

Leadership of Board by chair
Board composition and responsibilities
Role of non-Executive Directors
Company secretary, policies, processes, information,
time and resources•

Board composition102•

Key roles and responsibilities

104•

General qualifications required of all Directors

101•

Information and training

112•

Strategic Report

12

•

•

Board engagement with key stakeholders

110

Section 3: Composition, succession and evaluation•

Shareholder engagement

111

J.

•

Audit and Risk Committee report

118

K.

•

Conflicts of interest

113

L.

Board appointments and succession planning112

See page

Board appointments and succession plans for board andsenior management and promotion of diversity
Skills, experience and knowledge of board and length ofservice of board as a whole
Annual evaluation of Board and Directors anddemonstration of whether each Director continues tocontribute effectively

On the appointment of any new Executive
Director, we intend that their pension
contributions will be aligned with the pension
scheme for the wider workforce.
Pursuant to our obligations under the Listing
Rules, we apply the principles and comply with theprovisions of the UK Corporate Governance Codeor explain any instances of non-compliance in
our Annual Report. The Company has applied theprinciples as far as possible and in accordance withand as permitted by Swiss law. Further information
on appointment of Directors and compliancewith the UK Corporate Governance Code can befound as follows:

Section 4: Audit, risk and internal controls

See page

M. Independence and effectiveness of internal and external
audit functions and integrity of financial and narrative
statements
N. Fair, balanced and understandable assessment of theCompany’s position and prospects
O. Risk management and internal control framework andprincipal risks Company is willing to take to achieve its
long-term objectives•

Audit and Risk Committee report

118•

Strategic Report

12•

Fair, balanced and understandable Annual Report

119, 123,
156•

Going concern basis of accounting

162•

Viability statement

82

Section 5: Remuneration

See page

P.

•

Board composition

102•

Diversity, tenure and experience

105•

Board, committee and Director performance evaluation

112•

Nomination Committee report

124

Remuneration policies and practices to support strategy
and promote long-term sustainable success with executive
remuneration aligned to Company purpose and values
Q. Procedure for Executive Director and senior management
remuneration
R. Authorisation of remuneration outcomes•

Remuneration Committee report128Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

UK Corporate Governance Code 2018 continued
Certain differences between
the Company’s corporate
governance practices and the
UK Corporate Governance CodeIn accordance with the established policy
of appointing all Directors for one year at a time,
the Board intends to continue to keep all positions
under regular review and subject to annual election
by shareholders at the Annual General Meeting.

The Swiss corporate rules regarding thecompensation in listed companies further limits
the authority of the Remuneration Committee
and the Board to determine compensation.
The effective limitations include requiring that theAnnual General Meeting approve the maximum
total compensation of each member of the Boardand the Executive Leadership Team, requiring thatcertain compensation elements be authorised in
the Articles of Association and prohibiting certain
forms of compensation, such as severance
payments and financial or monetary incentives
for the acquisition or disposal of firms. We are incompliance with the requirements of the Swiss
corporate rules regarding the compensation in
Listed Companies and have amended our Articles
of Association to that effect.

The Board is cognisant of the length of tenureof the Chairman and when he was first appointed
to the Board. However, the Board continues tobelieve that the proven leadership of our Chairman
in combination with his deep knowledge of the
Coca-Cola System position him as unique to steer
the Group at the current time.

Anastassis David was originally appointed as
non-Executive Director in 2006 at the request of
Kar-Tess Holding and was not, at the time of his
appointment as Chairman, in 2016, independent
as defined by the UK Corporate GovernanceCode. In view of Anastassis David’s strong
identification with the Company and its
shareholder interests, combined with his deep
knowledge and experience of the Coca-Cola
System, the Board deemed it to be in the bestinterests of the Group and its shareholders for
him to be appointed as Chairman, to continue topromote an effective and appropriately balanced
leadership of the Group.

Application of governance codes
Other corporate governance codes
There is no mandatory corporate governancecode under Swiss law applicable to the Company.
The main source of law for Swiss governance rules
is the company law contained in article 620 ff.
of the Swiss Code of Obligations, as well as the
Swiss corporate rules regarding the compensationin listed companies.
In addition, the UK’s City Code on Takeovers
and Mergers (the ‘City Code’) does not apply to
the Company, because The Company does nothave its registered office in the United Kingdom,
the Channel Islands or Isle of Man. The Articles
of Association include specific provisions designed
to prevent any person acquiring shares carrying
30% or more of the voting rights (taken together
with any interest in shares held or acquired by theacquirer or persons acting in concert with theacquirer) except if (subject to certain exceptions)such acquisition would not have been prohibitedby the City Code or if such acquisition is madethrough an offer conducted in accordance with
the City Code. For further details, please refer tothe Company’s Articles of Association, which areavailable on our website.

Amending the Articles of Association
The Articles of Association may only be amended
by a resolution of the shareholders passed by amajority of at least two-thirds of the voting rights
represented and an absolute majority of thenominal value of the shares represented.
Share capital structure
The Company has ordinary shares in issue with anominal value of CHF 6.70 each. Rights attachingto each share are identical and each share carries
one vote. The Company’s Articles of Association
also allow, subject to shareholder approval, for theconversion of registered shares into bearer sharesand bearer shares into registered shares. Detailsof the movement in ordinary share capital during
the year can be found on page 215. There are no
persons holding shares that carry special rights
with regard to the control of the Company.
Powers of Directors to issue and buy
back shares
Subject to the provisions of the relevant laws
and the Articles of Association, the Board acting
collectively has the ultimate responsibility forrunning the Company and the supervision andcontrol of its executive management. The
Directors may take decisions on all matters thatare not expressly reserved to the shareholders
by the Articles of Association. Pursuant to theprovisions of the Articles of Association, theDirectors require shareholder authority to issue
and repurchase shares.

At the Annual General Meeting on 21 June 2022,
the shareholders authorised the Directors torepurchase ordinary shares of CHF 6.70 eachin the capital of the Company up to a maximum
aggregate number of 10,000,000 representing
less than 10% of the Company’s issued sharecapital as of 10 May 2022. The authority will expire
at the conclusion of the 2023 Annual General
Meeting on 17 May 2023 or at midnight on 30
June 2023, whichever is earlier. Total shares heldin treasury are 5,386,717 of which 1,956,582 sharesare held by Coca-Cola HBC AG and 3,430,135
shares are held by its subsidiary, Coca-Cola HBC
Services MEPE.

97

98

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Board of Directors

The Boardof Directors

Anastassis G. David

Non-Executive Chairman
Appointed: January 2016. He joined theBoard of Coca-Cola HBC as a non-Executive
Director in 2006 and was appointed Vice
Chairman in 2014.
Skills, experience and contribution:
Anastassis brings to his role more than 20
years’ experience as an investor andnon-Executive Director in the beverageindustry. Anastassis is also a former
Chairman of Navios Corporation. He holds a
BA in History from Tufts University.
External appointments: Anastassis is activein the international community. He serves asVice Chairman of Aegean Airlines S.A., Vice
Chairman of the Cyprus Union of Shipowners
and Chairman of the Board of Sea Trade
Holdings Inc, a shipowning company of dry
cargo vessels. He is also a member of theBoard of Trustees of College Year in Athens.
Nationality: British

Board committees
Audit and Risk Committee 118
Nomination Committee 124
Social Responsibility Committee 126
Remuneration Committee 128
Committee Chair

Zoran Bogdanovic

Chief Executive Officer, Executive Director
Appointed: June 2018.
Skills, experience and contribution: Zoran
was previously the Company’s Region
Director responsible for operations in 12
countries and has been a member of the
Executive Leadership Team since 2013. He
joined the Company in 1996 and has held anumber of senior leadership positions,
including as General Manager of theCompany’s operations in Croatia,
Switzerland and Greece. Zoran has a trackrecord of delivering results across our
territories and demonstrating the values thatare the foundation of our Company culture.
External appointments: None
Nationality: CroatianCharlotte J. Boyle

Independent non-Executive Director
Appointed: June 2017.
Skills, experience and contribution: After
14 years with The Zygos Partnership, aninternational executive search and board
advisory firm, including nine years as apartner, she retired from her position in July
2017. Prior to that, Charlotte worked atGoldman Sachs International and at Egon
Zehnder International, an international
executive search and management
assessment firm. Charlotte obtained an MBAfrom the London Business School and an MAfrom Oxford University and was a Bahrain
British Foundation Scholar.
External appointments: Charlotte serves
as Chair of UK for UNHCR, an independent
non-executive director and chair of theEnvironment, Sustainability and Community
Committee of Shaftesbury Capital PLC, a
non-Executive Director of Thatchers Cider
Company Ltd, a non-executive adviser tothe Group Executive Board of Knight FrankLLP and as a Trustee and chair of the financecommittee of Alfanar, the venturephilanthropy organisation.
Nationality: British

Henrique Braun

Non-Executive Director
Appointed: June 2021.
Skills, experience and contribution:
Henrique has vast experience in corporate
functions as well as regional and business
unit operations in The Coca-Cola Company.
He joined The Coca-Cola Company in 1996
in Atlanta and progressed through increasing
responsibilities in North America, Europe andLatin America. His career responsibilities
have included supply chain, new businessdevelopment, marketing, innovation, generalmanagement and bottling operations. From2020 to 2022, Henrique served as Presidentof the Latin America operating unit, from2016 to 2020, he served as the President of
the Brazil business unit and from 2013 to2016, he was the President for Greater China
and Korea. His other roles in The Coca-Cola
Company in the past include Vice Presidentof Innovation and Operations in Brazil and
Director for Still Beverages (non-carbonatedbeverages) in Europe. He first joined The
Coca-Cola Company as a trainee in Global
Engineering in the US. Henrique holds abachelor’s degree in agricultural engineeringfrom the University Federal of Rio de Janeiro,
a master’s in industrial engineering from
Michigan State University and an MBA from
Georgia State University.
External appointments: Henrique currently
serves as President, International
Development for The Coca-Cola Company,
overseeing the company’s operating units
for Latin America, Japan and South Korea,
ASEAN and South Pacific, Greater China andMongolia, Africa, India and Southwest Asia
and Eurasia and Middle East.
Nationality: American and Brazilian

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Board of Directors continued

Olusola (Sola) David-Borha

Independent non-Executive Director
Appointed: June 2015.
Skills, experience and contribution: Sola
has more than 30 years’ experience infinancial services and held several senior
roles within the Stanbic Group, including theposition of Chief Executive of Stanbic IBTCBank from May 2011 to November 2012. She
also served as Deputy Chief Executive
Officer of Stanbic IBTC Bank and Head ofInvestment Banking Coverage Africa(excluding South Africa). Stanbic IBTC
Holdings is listed on the Nigerian Stock
Exchange and is a member of Standard Bank
Group. Between January 2017 and March
2021, Sola has been the Chief Executive of
the Africa Regions (excluding South Africa)
for Standard Bank Group, Africa’s largest
bank by assets with operations in 20
countries across the continent.
Sola holds a first degree in Economics andobtained an MBA degree from Manchester
Business School. Her executive education
experience includes the Advanced
Management Programme of the Harvard
Business School and the Global CEO
Programme of CEIBS, Wharton and IESE.
External appointments: Sola serves as
non-executive director on the boards of
Stanbic IBTC Holdings Plc and Stanbic
Uganda Holdings Limited, listed entities thatare members of the Standard Bank Group.
Finally, Sola was appointed Chairman of
Stanbic IBTC Bank Plc, a non-listed
subsidiary of Stanbic IBTC Holdings Plc in
October 2021.
Nationality: Nigerian

Anna Diamantopoulou

Independent non-Executive Director
Appointed: June 2020.
Skills, experience and contribution: Anna,
as a former European Commissioner, brings
to the Group a unique expertise on mattersof employment and equal opportunity
together with deep knowledge of theEuropean CSR agenda. Anna was an elected
Member of the Greek Parliament for over a
decade, during which time she served as
Deputy Minister for Industries, Minister of
Education, Lifelong Learning and Religious
Affairs and Minister of Development,
Competitiveness and Shipping of theHellenic Republic. From 1999 to 2004, Anna
served as a member of the European
Commission in charge of Employment,
Social Affairs and Equal Opportunities.
External appointments: Founder andPresident of DIKTIO-Network for Reform in
Greece and Europe, a leading Athens-based
independent, non-partisan policy institute. A
Council Member of the European Council on
Foreign Relations, an Advisory Board
Member of Delphi Economic Forum and amember of the Honorary Board of the
Bussola Institute, a foundation aiming tostrengthen cooperation between the EU andthe GCC. Finally, Anna is the Chair of theEuropean Commission’s High Level Groupon the future of social protection and thewelfare state in the EU.
Nationality: Greek

William W. (Bill) Douglas III

Independent non-Executive Director
Appointed: June 2016.
Skills, experience and contribution: Bill isa former Vice President of Coca-Cola
Enterprises, a position in which he served
from July 2004 until his retirement in June
2016. From 2000 until 2004, Bill served as
Chief Financial Officer of Coca‑Cola HBC. Billhas held various positions within the
Coca-Cola System since 1985, including
positions with responsibility for the IT
function. Before joining the Coca‑Cola
System, Bill was associated with Ernst &Whinney, an international accounting firm.
He received his undergraduate degree fromthe J.M. Tull School of Accounting at the
University of Georgia.
External appointments: Bill is the Lead
Director and Chairman of the Audit
Committee of SiteOne Landscape Supply,
Inc. He is also a member of the Board of
Directors and Chair of the Audit Committee
for The North Highland company. He also
serves on the Board and is a past Chair of the
University of Georgia Trustees.
Nationality: American

Reto Francioni

Senior Independent non-Executive Director
Appointed: June 2016.
Skills, experience and contribution: Reto
has been Professor of Applied CapitalMarkets Theory at the University of Baselsince 2006 and is the author of several highly
respected books on capital market issues.
From 2005 until 2015, Reto was Chief
Executive Officer of Deutsche Börse AG andfrom 2002 until 2005, he served as Chairmanof the Supervisory Board and President of
the SWX Group, which owns the Swiss Stock
Exchange and has holdings in otherexchanges. Between 2000 and 2002, Reto
was Co-Chief Executive Officer andSpokesman for the Board of Directors ofConsors AG. Between 1993 and 2000, heheld various management positions at
Deutsche Börse AG, including that of Deputy
Chief Executive Officer. He earned his
Doctorate of Law at the University of Zurich.
External appointments: Reto serves as
Chairman of the Supervisory Board of UBS
Europe SE and also as the Chairman of theSupervisory Board of Swiss International
Airlines. Reto is also a Vice Chairman at theBoard of Directors of Medtech Innovation
Partners AG, Basel.
Nationality: Swiss

Anastasios I. Leventis

Non-Executive Director
Appointed: June 2014.
Skills, experience and contribution:
Anastasios began his career as a banking
analyst at Credit Suisse and then American
Express Bank. He has previously served on
the boards of the Cyprus Development Bankand Papoutsanis SA. He holds a BA in
Classics from the University of Exeter and an
MBA from New York University’s Leonard
Stern School of Business.
External appointments: Anastasios is aboard member of A.G. Leventis (Nigeria) Ltd.
He is also a director of Alpheus
Administration, a private company thatadministers assets for private clients andcharitable foundations. In addition, he serves
as a trustee of the A.G. Leventis Foundation,a member of the Board of Overseers of the
Gennadius Library in Athens and a memberof the Campaign board of the University of
Exeter. He is a co-founder of the Cyclades
Preservation Fund.
Nationality: British

99

100

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Board of Directors continued

Christo Leventis

Non-Executive Director
Appointed: June 2014.
Skills, experience and contribution:
Christo worked as an Investment Analyst
with Credit Suisse Asset Management from1994 to 1999. In 2001, he joined J.P. Morgan
Securities as an Equity Research Analyst
focusing on European beverage companies.
From 2003 until March 2014, Christo was amember of the Board of Directors ofFrigoglass S.A.I.C., a leading global
manufacturer of commercial refrigeration
products for the beverage industry. Christo
holds a BA in Classics from University College
London and an MBA from the Kellogg Schoolof Management in Chicago.
External appointments: Christo is the
Chairman of Alpheus Capital, a single-family
private equity investment office.
Nationality: British

Alexandra Papalexopoulou

Independent non-Executive Director
Appointed: June 2015.
Skills, experience and contribution:
Alexandra worked previously for the OECDand the consultancy firm Booz, Allen &Hamilton, in Paris. From 2003 until February
2015, she served as a member of the boardof directors of Frigoglass S.A.I.C. From 2010
to 2015, she served as a member of theboard of directors of National Bank of
Greece and from 2007 to 2009, she served
as a member of the board of directors ofEmporiki Bank. Alexandra holds a BA in
Economics and Mathematics from
Swarthmore College in the US and an MBAfrom INSEAD in France.
External appointments: Alexandra is the
Deputy Chair of the Group Executive
Committee at Titan Cement Company S.A.,
with direct oversight of Group Strategy andBusiness Development, Trading, Legal and
the Group’s operations in the Eastern
Mediterranean, where she has been
employed since 1992 and has served as
Executive Director since 1995. Alexandra istreasurer and a member of the board of
directors of the Paul and Alexandra
Canellopoulos Foundation, a member of theboard of trustees of the INSEAD businessschool and, a member of the board oftrustees of the American College of Greece
and an independent non-executive directorof Aegean Airlines.
Nationality: Greek

Bruno Pietracci

Non-Executive Director
Appointed: June 2021.
Skills, experience and contribution:
Bruno has a more than 20-year track recordof transforming businesses, people andcommunities and brings experience andknowledge of the Coca-Cola System, having
held a number of roles at The Coca-Cola
Company since 2008. From 2018 to 2020,
he was President of The Coca-Cola
Company’s Southern and East Africa Business
Unit and from 2016 to 2018, he served as
the Vice-President of Operations in Europe,
Middle East and Africa. Prior to that, he was
the General Manager for Colombia,
Venezuela and Ecuador (from 2014 to 2016)
and General Manager of FU Center in Brazil(from 2012 to 2014). From 2010 to 2012,he was the General Manager of FU South inBrazil. Bruno joined The Coca-Cola Company
in 2008 as Vice-President of Strategy,
Insights and Innovation in Brazil. Prior to that
he worked at McKinsey & Company in Brazil
and Portugal from 1997 to 2008, working inmarketing and sales with consumer-packaged
goods and telecommunications clients.
He has served on the board of Coca-Cola
Beverages Africa since 2017 and has also
served on the boards of Toni Corp in Ecuador(2016) and Matte Leão in Brazil (2009).
In 2016, he was the Chairman of Corporación
Juego y Niñez in Colombia. Bruno holds abachelor’s degree in mechanical engineeringfrom the Universidade Estadual de Campinas
in Brazil and an MBA from INSEAD in France.
External appointments: Bruno currently
serves as President of the Africa Operating
Unit for The Cola-Cola Company, a role
which he has held since 2020.
Nationality: Brazilian and Italian

Ryan Rudolph

Non-Executive Director
Appointed: June 2016.
Skills, experience and contribution:
From 2006 until 2019, Ryan was an attorney
and partner at the law firm Oesch & Rudolph.
From 1993 until 2006, he worked as an
attorney at the business law firm Lenz &Staehelin in Zurich. Prior to that, he worked
as a public relations consultant at the public
relations agency Huber & Partner in Zurich,as marketing assistant and subsequently as
manager at Winterthur Life Insurance as wellas part-time with D&S, the Institute forMarketing and Communications Research in
Zurich. Ryan obtained an LLM from the
University of Zurich and is admitted to the
Zurich bar. Ryan also studied at the Facultédes Lettres of the University of Geneva, as
well as the Ecole Polytechnique in Lausanne.
External appointments: Ryan is an attorney
and partner at the Zurich-based law firm RCS
Trust & Legal AG. In addition, he serves as amember of the Foundation Board of the A.G.
Leventis Foundation and as a member of theboard of various privately-held companies
and charitable foundations.
Nationality: Swiss

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report
General qualifications requiredof all Directors
Coca-Cola HBC’s Board Nomination Policy
requires that each Director is recognised as aperson of the highest integrity and standing, both
personally and professionally. Each Director must
be ready to devote the time necessary to fulfil his
or her responsibilities to the Company according
to the terms and conditions of his or her letter of
appointment. Each Director should havedemonstrable experience, skills and knowledge
which enhance Board effectiveness and willcomplement those of the other members of theBoard to ensure an overall balance of experience,skills and knowledge on the Board. In addition,
each Director must demonstrate familiarity withand respect for good corporate governancepractices, sustainability and responsible
approaches to social issues.

Environmental, social andcorporate governance (ESG)skills and experienceAs evidenced by our commitment to achieve net
zero emissions by 2040, which was announced in
October 2021, the Company’s approach to
managing our environmental impact is ambitious.
In support of this ambition, which builds on ourlong history of sustainability management, theBoard approved a robust plan in 2021 that it
continues to implement, in order to achieve its
targets by 2040.
As part of this effort, the Social Responsibility
Committee proposed, and the Board approved,science-based targets for the Company to reduce
its value chain emissions in Scopes 1, 2 and 3 by
2040. Anna Diamantopoulou’s familiarity with thesocial protection and welfare state at the EU
Commission High-Level Group, in addition to theexpertise of a number of our Board members that
sit on the Boards of other multi-nationals that facesimilar challenges and have similar concerns on
the ESG agenda, helped us identify thecommitments that we want to make in the areaand set the relevant targets.

Business characteristics

Qualifications, skills and experience Directors

Our business is extensive and involves complex
financial transactions in the various jurisdictions
where we operate

Experience in finance, investments
and accounting

12

Our business is truly international with
operations in 29 countries, at different stagesof development, on three continents

Broad international exposure, andemerging and developing markets
experience13

Our business involves the preparation,
packaging, sale and distribution of the world’s
leading non-alcoholic beverage brands

Extensive knowledge of our businessand the fast-moving consumer goods
industry, as well as experience with
manufacturing, route-to-market andcustomer relationships

6

Our Board’s responsibilities include theunderstanding and oversight of the key risks weare facing, establishing our risk appetite andensuring that appropriate policies andprocedures are in place to effectively manage
and mitigate risks

Risk oversight and management
expertise

12

Building community trust through the
responsible and sustainable managementof our business is an indispensable partof our culture

Expertise in sustainable sourcing
and packaging, CO2 emissions andexperience in wider stakeholder
engagement

8

Our business involves compliance with manydifferent regulatory and corporate governancerequirements across a number of countries, aswell as relationships with national governments
and local authorities

Expertise in corporate governanceand/or government relations

7

Environmental, social and corporate
governance (ESG) are prominent in ourbusiness, in particular workforce matters,
environmental and climate change issues
and supply chain sustainability

Expertise in ESG matters andsustainable and responsible businesspractices

101

102

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued
Board composition
Membership of the Board
On 31 December 2022, our Board comprised 13
Directors: the Chairman, one Senior Independent
Director, 10 non-Executive Directors and one
Executive Director. The biographies of eachmember of the Board are set out on pages 98.
The non-Executive Directors, of whom six(representing half of the members of the Board,
excluding the Chairman) are determined by the
Board to be independent, are experienced
individuals from a range of backgrounds, countries
and industries. The composition of the Board
complies with the UK Corporate Governance Code’s
recommendation that at least half of the Board,
excluding the Chairman, comprise independent
Directors. There were no changes to the Boardor committee memberships during 2022.

Outside appointments
The Articles of Association of the Company(article 36) set limits on the maximum number ofexternal appointments that members of our Boardand executive management may hold. In addition,
if a Board member wishes to take up an external
appointment, he or she must obtain prior Board
approval. The Board will assess all requests on acase-by-case basis, including whether theappointment in question could negatively impact
the Company or the performance of the Director’s
duties to the Group.
The nature of the appointment and the expected
time commitment are also assessed to ensurethat the effectiveness of the Board would not
be compromised.
Details of the external appointments of ournon-Executive Directors are contained in theirrespective biographies set out on pages 114 to 116.

Our Chairman serves as Vice-Chairman of Aegean
Airlines S.A., Vice-Chairman of the Cyprus Unionof Ship-owners and Chairman of the Board of Sea
Trade Holdings Inc., a ship owning company of dry
cargo vessels. He is also a member of the Board ofTrustees of College Year in Athens. In this context,
the Board considers that fewer than four of thepositions held by the Chairman are considered tobe significant.

Independence

A number of our other Directors also have otherexternal roles, but having considered the scopeof the external appointments of all Directors,
including the Chairman, our Board is satisfied thatthey do not compromise the effectiveness of theBoard as each Director has sufficient time to
devote to his or her role on the Board as the Board
requires. According to the terms of appointment
the Directors are expected to devote such time asnecessary for the performance of their duties.
This will include attendance annually atapproximately 10 Board meetings, Annual General
Meetings and other meetings. As can be seen in
the table of attendance of Board and Board
Committee meetings on page 105, the Directors
were able to devote the time required of them totheir role on the Board. The Board has determinedthat each member of the Board commits
sufficient time and energy to the role andcontinues to make a valuable contribution to theBoard and its committees.

The other non-Executive Directors, Anastassis
David (Chairman), Henrique Braun, Anastasios I.
Leventis, Christo Leventis, Bruno Pietracci and
Ryan Rudolph, were appointed at the request ofshareholders of the Company: Kar-Tess Holding
and The Coca-Cola Company. They are therefore
not considered, by the Board, to be independent
as defined by the UK Corporate Governance Code.

Our Board has concluded that Charlotte J. Boyle,
Olusola (Sola) David-Borha, Anna Diamantopoulou,
William W. (Bill) Douglas III, Reto Francioni andAlexandra Papalexopoulou are deemed to be
independent in accordance with the criteria set
out in the UK Corporate Governance Code, withsuch individuals being independent in bothcharacter and judgement.

Anastassis David was appointed as Chairman on
27 January 2016. The Board firmly believes that
Anastassis David embodies the Company’s corevalues, heritage and culture and that these
attributes, together with his strong identification
with the Company and its shareholders’ interests,
and his deep knowledge and experience of the
Coca-Cola System, ensure an effective andappropriately balanced leadership of the Boardand the Company. Anastassis David was first
appointed as a member of the Board in 2006
before being appointed Chairman in 2016. Prior to
his appointment as Chairman, major shareholders
were consulted, and an external search
consultancy engaged to find suitable candidates.

The consensus and recommendation was that
Anastassis David was the appropriate candidate
to become Chairman and that he continues to beeffective in his leadership of the Board. Anastassis
David has the continuing support of the Boardand major shareholders to remain as Chairman.

Shareholders’ nominees
As described under the heading ‘Major
shareholders’ on page 253, since the main listingof the Company on the Official List of the London
Stock Exchange in 2013, Kar-Tess Holding, The
Coca-Cola Company and their respective affiliates
have no special rights in relation to the appointment
or re-election of nominee Directors, and those
Directors of the Company who were originallynominated at the request of The Coca-Cola
Company or Kar-Tess Holding will be required
to stand for re-election on an annual basis in thesame way as the other Directors. The Nomination
Committee is responsible for identifying andrecommending persons for subsequent
nomination by the Board for election as Directors
by the shareholders on an annual basis.
As our Board currently comprises 13 Directors,
neither Kar-Tess Holding nor The Coca-Cola
Company is in a position to control (positively or
negatively) decisions of the Board that are subject
to simple majority approval. However, decisions of
the Board that are subject to the special quorum
provisions and supermajority requirements
contained in the Articles of Association, in
practice, require the support of Directors
nominated at the request of at least one of either
The Coca-Cola Company or Kar-Tess Holding
in order to be approved.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Corporate governance report continued
In addition, based on their current shareholdings,
neither Kar-Tess Holding nor The Coca-Cola
Company is in a position to control a decision of
the shareholders (positively or negatively), except
to block a resolution to wind up or dissolve theCompany or to amend the supermajority voting
requirements. The latter requires the approval of
80% of shareholders where all shareholders are
represented and voting. Depending on theattendance levels at Annual General Meetings,
Kar-Tess Holding or The Coca-Cola Company
may also be in a position to control other mattersrequiring supermajority shareholder approval.
Anastassis G. David, Anastasios I. Leventis,
Christo Leventis and Ryan Rudolph were all
originally appointed at the request of Kar-Tess
Holding. Henrique Braun and Bruno Pietracci
have been appointed at the request of
The Coca‑Cola Company.

Separation of roles
There is a clear separation of the roles of the
Chairman and the Chief Executive Officer.
The Chairman is responsible for the operationof the Board and for ensuring that all Directors areproperly informed and consulted on all relevant
matters. The Chairman, in the context of theBoard meetings and as a matter of practice,also meets separately with the non-Executive
Directors without the presence of the Chief
Executive Officer and promotes a culture of
openness and debate within the Board sessions
as well as outside the formal sessions.
The Chairman is also actively involved in the workof the Nomination Committee concerning
succession planning and the selection of key
people. The Chief Executive Officer, Zoran
Bogdanovic, is responsible for the day-to-day
management and performance of the Company
and for the implementation of the strategy
approved by the Board.

103

104

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

Key roles and responsibilities
Board of Directors

Our Board has ultimate responsibility for our long-term success and for delivering sustainable shareholder value
as well as contributing to wider society. The Board is responsible for setting the Company’s purpose, values andstrategy and ensures the alignment with its culture; this includes ensuring that workforce policies and practices are
consistent with the Company’s values and support its long-term sustainable vision. Further details are set out on
pages 21 to 22. This is achieved by approving the corporate strategy, monitoring performance toward strategic
objectives, overseeing implementation of the strategy by the Executive Leadership Team and approving mattersreserved by the Articles of Association for decision by the Board. Specific tasks are delegated by the Board to its
committees for audit and risk, nomination, remuneration and social responsibility.

Chairman• leads the Board, sets the agenda
and promotes a culture of opennessand debate;• is responsible for overall effectivenessin leading the Company and setting
the culture;• ensures the highest standardsof corporate governance;• is the main point of contact between
the Board and management; and• ensures effective communication
with shareholders and stakeholders.

Chief Executive Officer• leads the business, implements
strategy and chairs the Executive
Leadership Team; and• communicates with the Board,shareholders, employees, government
authorities, other stakeholders
and the public.

Senior Independent Director• acts as a sounding board for the
Chairman and appraises his
performance;• leads the independent non-Executive
Directors on matters that benefit froman independent review; and• is available to shareholders if they haveconcerns that have not been resolved
through the normal channels ofcommunication.

Board committees

Our Board has delegated specific tasks to its committees as set out in the Organisational Regulations and reports
from these committees are set out in this corporate governance report. Biographies of the Chairs of the Board

Audit and Risk Committee
Responsibilities• Oversight of the accounting policies, financial
reporting and disclosure controls; the Group’s
approach to internal controls and risk management;
and the quality, adequacy and scope of internal andexternal audit functions.
• Oversight of the Company’s compliance with legal,
regulatory and financial reporting requirements, andthe work programme of the internal audit function.
• External auditor reports directly to the Committee.

Executive Leadership TeamThe governance process of the Board is set out in our Articles of Association and the Organisational Regulations.
These regulations define the role and responsibilities of the Board and its committees. These documents, together
with the responsibilities of the Chairman, Chief Executive Officer and Senior Independent Director, can be found athttps://www.coca-colahellenic.com/en/about-us/corporate-governance. In addition, the Swiss corporate rules
regarding the compensation in listed companies imposes certain obligations on the Board, including a requirement
to prepare and make available a Remuneration Report pursuant to Swiss law.

Remuneration Committee
Responsibilities• Establishment of the remuneration strategy for theGroup; determines and agrees with the Board the
remuneration of Group Executives and approves
remuneration for the Chairman and the Chief
Executive Officer.
• Makes recommendations to the Board regarding
remuneration matters to be approved at the Annual
General Meeting.
• Implementation or modification of any employee
benefit plan resulting in an increased annual costof €5 million or more.

The Executive Leadership Team, led by the Chief Executive Officer, meets monthly each year and provides theGroup with executive leadership. The Committee has responsibility for: the development of long-term strategies
and the implementation of strategies approved by the Board; providing adequate head‑office support for each

Non-Executive Directors• contribute to developing
Group strategy;• scrutinise and constructively challenge
the performance of management in theexecution of the Group’s strategy; and• oversee succession planning, including
the appointment of Executive Directors.

Company Secretary• ensures that correct Board proceduresare followed and ensures the Board
has full and timely access to all
relevant information;• facilitates induction and training
programmes, and assists with theBoard’s professional development
requirements; and• advises the Board on governancematters.

committees and the other members of the Board, the Audit and Risk Committee, the Nomination Committee,
the Remuneration Committee and the Social Responsibility Committee are set out on pages 118 to 127.

Nomination Committee
Responsibilities• Identification and nomination of new Board
members, including recommending Directors
to be members of each Board committee.
• Ensuring adequate Board training; supporting
the Board and each committee in conducting
a self-assessment.
• Oversight of the establishment of a talentdevelopment framework for the Group.
• Oversees effective succession planning for the
Chief Executive Officer, in consultation with the
Chairman, and for the Executive Leadership Team,in consultation with the Chief Executive Officer.

Social Responsibility Committee
Responsibilities• Supports the Board in its responsibilities tosafeguard the Group’s reputation for responsible
and sustainable operations.
• Oversight of the Group’s engagement withstakeholders to assess their expectations, and thepossible consequences of these expectations for
the Group.
• Establishes principles governing social andenvironmental management and oversees
development of performance management toachieve social and environmental goals.

of the Group’s countries; working closely with the country General Managers, as set out in our operating framework;and the setting of annual targets and approval of annual business plans which form the basis of the Group’s
performance management.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Informaation

Corporate governance report continued

Governance at a glance

Board composition dashboard

Highlights

Board gender diversity

929.7(€m)

85%

The Board has remained focused on our
medium-term Growth Story 2025 strategy
and has been able to prioritise the actions
and investments that have positioned
the company for sustained success.
Our performance in 2022 was testament tothis with record levels of comparable EBIT,
free cash flow and strong ROIC.

The engagement score remains stable
and turnover rates have reduced to 11.4%.
See page 109 for how the Board monitorsand engages with our people and page
131 for more insight into our enhanced
workforce remuneration arrangements
in light of the cost of living crisis.

Comparable EBIT

#1

employee engagement score

Ranked the world’s most sustainable
beverage company by the 2022 Dow
Jones Sustainability Index. This is the 12th
consecutive year that Coca-Cola HBC hasfeatured among the top three performers,
and the sixth time it has been named theindustry leader. See more on the work of thesocial responsibility committee on page 126.

Anastassis G. David1
Zoran Bogdanovic
Charlotte J. Boyle
Henrique Braun
Anna Diamantopoulou
Olusola (Sola) David-Borha
William W. (Bill) Douglas III
Reto Francioni
Anastasios I. Leventis
Christo Leventis
Alexandra Papalexopoulou
Bruno Pietracci2
Ryan Rudolph

Men
Women

9
4

Tenure (years)

Attendance table

Director

Shareholder structure (%)

Appointed

Board
Attended/
Total meetings

January 2016
June 2018
June 2017
June 2021
June 2020
June 2015
June 2016
June 2016
June 2014
June 2014
June 2015
June 2021
June 2016

7/7
7/7
7/7
7/7
7/7
7/7
7/7
7/7
7/7
7/7
7/7
7/7
7/7

Audit and Risk
Attended/
Total meetings

Remuneration
Attended/
Total meetings

Nomination
Attended/
Total meetings

3/3

3/3

3/3

3/3

3/3

3/3

SocialResponsibility
Attended/
Total meetings

4/4

1-2
2-3
4-5
5-6
6-7
7-8
8-9
15-16

The Coca-Cola Company
KAR-Tess Holding
Free ﬂoat

21
23
56

Age profile (years)
2
1
1
1
3
2
2
1

8/8
8/8

40 to 49
50 to 59
60 to 69
70+

1
7
5
0

Board Independence
Independent non-executive
directors
Non-independent directors
Executive directors

6
7
1

4/4
Nationalities

8/8

1. Anastassis David was appointed as Chairman in 2016 having been appointed to the Board in 2006.
2. Bruno attended the Board meeting in December 2022, but was not able to attend the Social Responsibility meeting due toother long-standing commitments.

3/4

AmericanAmerican/Brazilian
Brazilian/Italian
BritishCroatian
Greek
Nigerian
Swiss

Experience
1
1
1
4
1
2
1
2

Corporate governance
Finance, investments
and accounting
FMCG knowledge / experience
International exposure
Risk oversight andmanagement
Sustainability and community
engagement

7
12
6
13
12
8

105

106

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

AppliedGovernance

Performance

Risk management and internal control

Operational

Regions and functions

Principal and emerging risks

Cost optimisation and investment

Finance and IT

New acquisitions

Deep dive reviews of regions and key functions

Business performance

Key activities of the Board
in 2022The key activities of the Board during the year
are set out opposite.
The Board recognises the value of maintaining
close relationships with its stakeholders,
understanding their views and the importanceof these relationships in delivering our strategy.
The Group’s key stakeholders and theirdiffering perspectives are taken into accountas part of the Board’s discussions. You canread more in our s172 statement on page 8.
Board meeting discussions are structured
using a carefully tailored agenda that is agreed
in advance by the Chair in conjunction with the
CEO and the Company Secretary. A typical
Board meeting will comprise of thefollowing elements:• committee reports from the Chairs of our
Board Committees on the proceedings ofthose meetings, including the key discussion
points and particular matters to bring to theBoard’s attention;• performance reports including CEO
Overview, COO Overview, CFO Review andoperational performance reports;• deep-dive reports into areas of particular
strategic importance to evaluate progress,
provide insight and, where necessary, decide
on appropriate action; and• legal and governance updates including
proxy agencies scoring and annual Board
assessment.

Regular reviews of the business performance byreporting segments and monitoring of the performanceof the coffee and snack businesses

Performance measurement

Focusing on the performance of the Revenue GrowthManagement, Route-to-Market and big data andadvanced analytics programme in order to build thenecessary insight capabilities

Innovation for Growth

Following the Group’s Innovation for Growth plans

Continued review of principal and emerging risks
and mitigation programmes

Reviewing the liquidity, financing status and commodity
exposure of the Group and reviewing information
technology plans, including cyber security

Modern Trade and e-commerce

Reviewing the execution initiatives in modern trade,
e-commerce and growth results

New Sales Academy

Monitoring the progress of the new sales academy
for the Group’s business developers

Ongoing review of the Group’s cost optimisation andinvestment programmes

Consolidation and integration of Egypt, including review
and approval of the acquisition of the craft adult sparklingbusiness, Three Cents

Capital expenditure

Review of material capital expenditure projects

Russia/Ukraine

Reviewing the business model in Russia following
The Coca-Cola Company’s decision to suspend its
business there
Establishing a crisis management plan for Ukraine
focusing on protecting the Group’s people and assets

Digital Strategy

Review of the digital strategy and its key priorities aroundconsumer and customer centricity, employee experienceand operational productivity

Culture and values

Succession planning and diversity

Employee engagement surveys

Succession planning

Organisational design

Talent development

Discussing the employee engagement surveys andpeople plans

Reflecting on the implementation of the Group’s
organisational design

Engagement initiatives

Working with the designated non‑Executive Director
on issues that are identified through the employee
engagement process

Reviewing succession planning for Board and senior
management

Reviewing the Company’s talent development plans

Net Zero initiatives

Review of projects involving the in-house productionof PET from recycled PET (rPET) flakes and productionof CO2 collected from the air

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

Overseeing Strategic Delivery
Our growth pillars

1

Leverage ourunique 24/7 portfolio

2

Win in themarketplace

3

Fuel growth throughcompetitiveness andinvestment

4

Cultivate thepotentialof our people

5

Earn our licenceto operate

What did the Board consider?

What did the Board discussand approve?

What were the material
stakeholder considerations?

Reviewing the accelerators for the
future including initiatives in sparkling,energy and coffee

Continued acceleration of oursparkling, energy and coffee portfolios

Segmented portfolio can play criticalrole to accelerate revenue

Customer portals and digitalmarketing initiatives

Considering B2B models

Developing advanced reporting andanalytics tools for on-line commerce

Investments in returnable glass inAustrian operations, as well as,
investments in on-line platforms

The CapEx required and timelines forinvestments

Consumer needs and recycling

Collaborating for Impact survey

A new initiative discussed:“Collaborating for Impact” measuringcross-department collaboration
opportunities

Online, anonymous democratised
survey where every single employee
had the opportunity to provide
feedback

100% rPET launch in Switzerland and
Italy with other Group countries tofollow in 2023

All primary and secondary packaging
for products produced in Switzerland

Fully fledged 360 plan engaging
consumers, shoppers, customers andstakeholders

rPET conversion facilities in Italy,
Romania and Poland

107

108

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

Oversight of theCompany’s culture
How the Board measures andassesses culture
The Board is responsible for monitoring andassessing our culture. The Chairman ensures thatthe Board is operating appropriately and sets theBoard’s culture, which in turn forms the cultureof the Company. The Chief Executive Officer,
supported by members of the Executive
Leadership Team, is responsible for ensuring
culture is embedded throughout the businessand its operations and in all our dealings with
our stakeholders.
The Board measures the culture of the Group
using internal and external metrics which alsoenable it to identify further actions to ensure
culture remains appropriate. The Board also
monitors the Group’s performance against its
peer group within the same sector. The Board
considers the following:• Health and safety – an area of paramountimportance to our people, customers, partners,
and consumers of our products, especially given
the continuing impact of the conflict between
Russia and Ukraine. We continue to focus on
the health and safety of our people in all
countries. We closely monitored the situationand challenges in Ukraine to ensure we provided
the appropriate support.
• Employee retention – our employees are ourgreatest asset and it is important that we doeverything we can to retain them. We conduct
an annual employee engagement survey of theworkforce, and during 2022 an additional two
all-employee surveys were conducted toprovide feedback to senior management to
identify whether further actions were required.
The feedback was reviewed by the Executive
Leadership Team with the findings reported
to the Board.
• Customer retention – assessments ofcustomer satisfaction. In 2021 we adopted a
new approach and we continued to monitor
customer feedback in 2022 by use of Customer
Gauge across all our markets to receive
customer feedback on an ongoing basis. This
software-as-a-service tool gives us deeper,
more frequent insight than our annual customer
survey, leading to more actionable insights thatcan be addressed quickly. We continue to workwith our customers, consumers, suppliers, local
community representatives and other business
partners across the value chain every day.
Their input, cooperation and trust factors into
Board decision-making and the success of thebusiness. Examples of governance in action
are on page 107.

Culture in action
Doing the right thing
We continue to prioritise the safety of our people
and their families impacted by the war in Ukraine.
We are providing immediate financial support toour people in Ukraine and continue to workthrough The Coca-Cola Foundation and Red
Cross to provide humanitarian relief in theregion. This includes cash grants to our people
through the Coca-Cola Disaster Relief andCoca-Cola HBC Employee Donation Funds,
on top of salary advance payments andrefugee assistance centres across Ukraine.
We temporarily closed our plant in Ukraine
and stopped production for safety reasons,but progressively restarted manufacturing when
it was safe to do so. This demonstrated ourcommitment to our people and to the countries
in which we do business.
Throughout, our actions have been guided byour values. Below are some examples of culturein action during 2022:

Resilience, adaptability and agility• We stood by our people and focused on thehealth and safety of those who were impacted
by the conflict between Russia and Ukraine.
Following The Coca-Cola Company’ssuspension of business in Russia, we adapted
our Russian business to focus on the
production and sale of existing local brands.
The Group is continuously monitoring
performance of its Russian and Ukrainian
operations as well as the developments in theregion, to ensure timely actions and initiatives
are undertaken to minimise potential adverse
impact for the Group.

• We implemented a group-wide organisational
structure redesign, Project Dolphin, to ensurethat we have an efficient and adaptablestructure which serves local customers
and prioritises our most critical capabilities
for the future.
• We launched Project Oxygen, a Group-wide
initiative to reduce bureaucracy, simplify
our processes and allow more time forvalue-added tasks.

Sustainability• We accelerated our #YouthEmpowered
programme using both in-person and online
modules. The programme reached more than
246,000 people in 2022.
• To improve our supply of rPET we repurposed
an existing site, building a new plant that canconvert 30,000 tonnes of plastics per annum
into 100% rPET preform bottles.
• We continued to prioritise a circular approach
to packaging. For example, in Switzerland,
we successfully moved our entire, locally
produced portfolio to rPET and rolled outlabel-free bottles for our carbon-neutral waterbrand, Valser.
• We are committed to achieving a net positive
impact on biodiversity in critical areas by 2040
and eliminate deforestation in our supply chain
by 2030. In June 2022, we joined the Science
Based Targets Network corporate
engagement programme.
• In September 2022, we raised €500 million
through the issue of our first green bond.
The net proceeds will be allocated to projects
that meet the eligibility criteria outlined in ourGreen Finance Framework and will accelerate
progress of our NetZeroby40 and Mission
2025 commitments.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

Workforce engagement
Engagement with key stakeholder groups
strengthens our relationships and is an ongoingpart of the operational management of theGroup. This includes employee surveys, assessing
customer satisfaction and ongoing conversations
with regulators and non-governmentalorganisations. The Board receives regular updates
from senior management on insights and feedback
from stakeholders, which allows the Board tounderstand and consider the perspectives of key
stakeholders in decision making. This is a standing
agenda item for Board meetings.
Our workforce is core to our strategy and is
one of our most important stakeholder groups.
The Company’s success largely depends on thepassion of our people and our ability to attract,
retain and develop the best talent. The Board
therefore understands the importance ofengaging with its workforce. The safety of ourworkforce continued to be a focus throughout
2022, ensuring appropriate measures were inplace so that they could continue in their roles
and that we were supporting a healthy working
environment. Our workforce continued
extraordinary efforts to support and aid ourcustomers and consumers during uncertain times
caused by the conflict between Russia and Ukraine.

The Board closely monitors and reviews the resultsof the Company’s Employee Engagement surveys.
In addition, the Board reviews talent development
initiatives designed to support long-term success.
For further details please see below and the Growth
Pillar 4 section of the report on pages 38 to 42.
Charlotte Boyle, our designated non-Executive
Director for workforce engagement, attended
a number of meetings with our European Works
Council (EWC). Senior leadership present key
information on business and other changes atthese meetings and hear feedback directly from
employee representatives. All meetings areattended by selected members of the seniorleadership team, depending on subjects covered,including our CEO at our meeting in September.

Workforce engagement mechanism
Charlotte Boyle, our designated non-Executive
Director for workforce engagement, attended
the meetings during the year with our European
Works Council. During the course of thesemeetings Charlotte heard from elected
employee representatives from our businesses
in EU countries. These meetings allow employee
representatives to understand business updates
from senior leaders – including the CEO – aboutsignificant matters affecting our people, and to
ask questions and give feedback. Charlotte wasable to listen to employee representatives about
topics raised by employees and their experienceof the Company’s approach to the workforce,
particularly during the last couple of years,
and was able to bring these insights to theBoard’s discussions.
During 2022, the insights gained from theseengagement activities continued to be of great
importance, contributing to the Board’s
decisions in relation to ensuring the appropriate
support and resources for our people, not only
for their own safety but to aid them in their roles
in helping our customers and consumers.
Charlotte also frequently interacted with our
Head of Labor Relations Director, who is also
responsible for monitoring diversity, equity andinclusion, to better understand the steps that

the Company is taking to become more diverse
and inclusive (see page 41 for activities in thisarea). To embed these attributes within the
Company’s culture, multiple initiatives havebeen launched to increase awareness andunderstanding and improve policies and practices
to create a more equitable and inclusive workplace
for all. The Board takes the lead by recognising
good practices and driving accountability.
Charlotte reported back to the Board on her
observations and matters raised by employees,
ensuring Board deliberations and decision
making were fully informed.

109

110

Corporate
Governance

Strategic
ReportFinancial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

Engaging with
our stakeholders
Description
Our people

How the Board is kept informed
To understand what our people needed to work in continuallychanging circumstances, the Company conducted in total three
all-employee surveys in 2022. There is a designated non-Executive
Director for engagement with our people but the practice, whichbegan during the beginning of the COVID-19 pandemic, ofpresenting survey results to the full Board continued. The CEO
also held engagement sessions with employees during the year,
including several calls with Q&A sessions.

Listening to our stakeholders,and making a meaningful response,is crucial for continued success.
Read more
38

Russia and Ukraine conflict:Putting our people and customers first

Our customers Regular visits, dedicated account teams, joint business planning,28

Ourconsumers

Consumer hotlines, local websites, plant tours, research, surveys,
insights, focus groups.

24

Governments Trade Associations, recycling and recovery initiatives, EU Platform

45

Ourcommunities

Plant visits, community meetings, partnerships on common issues,
sponsorship activities, lectures at universities, training opportunities
and support to young people currently not in education, training or
employment.

45

Dialogue, policy work, partnerships on common issues, membershipof business and industry associations.

45

The Coca-Cola Day-to-day interaction as business partners, joint projects, joint
business planning, functional groups on strategic issues, ‘top-to-top’Company

18

joint value-creation initiatives, customer care centres, customer
satisfaction surveys.

for Action on Diet, Physical Activity and Health, foreign investment
advisory councils, chambers of commerce.

NGOs

Considering stakeholders
in principal decisions

senior management meetings.

Ourshareholders

Annual General Meetings, investor roadshows and results briefings,
webcasts, ongoing dialogue with analysts and investors.

16

Our suppliers

Engagement with our suppliers, consultants and counterparts inrelated industries.

32

The Russia-Ukraine conflict created a number
of issues for the Group and in particular for its
people. We continue to prioritise the safety of ourpeople, customers, partners and communities
who have been affected by the conflict between
Russia and Ukraine.
In February 2022, in Ukraine, we temporarilyclosed our plant and stopped production forsafety reasons. In May, we progressively restarted
manufacturing in Ukraine and are currently
distributing and selling beverages where it is safe
to do so. We are providing financial support to ourpeople in Ukraine and continue to work through
The Coca-Cola Foundation and Red Cross toprovide humanitarian relief in the region. We
continuously monitor the situation in Ukraine.
Following the decision of The Coca-Cola
Company on 8 March to suspend its business in
Russia, we immediately stopped placing orders
for concentrate in the country and stopped all
investment from the Group. We depleted thebrands of The Coca-Cola Company in the market
and transitioned to a 100%, self-sufficientbusiness in Russia, which is managed by a local
team and focused on local brands. This decision
was the best way to protect our people and assets.

Stakeholder considerations in thecontext of acquisitions
Stakeholder interests and matters were carefully
considered by the Board in the context of therecent acquisition and subsequent integration of
the Coca-Cola Bottling Company of Egypt S.A.E.

(CCBCE), a leading producer of non-alcoholic
ready-to-drink beverages in Egypt. The acquisition
completed on 13 January 2022. It has expanded
the Group’s existing footprint on the African
continent and further increased its exposure tohigh-growth markets, as it provided access to oneof the largest non-alcoholic ready-to-drink
markets by volume in Africa. In addition, sharingof the Group’s proven capabilities, experience andbest practices with CCBCE, is expected to unlock
growth opportunities, creating value for all
stakeholders. As part of the post-acquisition
integration of CCBCE, we have engaged, andare continuing to engage, with a wide range ofstakeholders notably, with the employees,
suppliers and customers of the business, withregulators and the Government in Egypt and withlocal communities, working closely with them as
we plan and implement the integration.
Engagement with stakeholders in Egypt including
our active participation in the 27th Annual United
Nations Climate Change Conference of theParties (COP27), which took place in Egypt inNovember 2022.
Similarly, broader stakeholder interests andcustomer expectations were also considered by
the Board in the context of the acquisition of ESM
Effervescent Sodas Management Limited, theowner of the super-premium adult sparkling
beverage and mixer product line under the ThreeCents brand. The acquisition of Three Cents will
strengthen our premium brand offerings and wascompleted in October 2022.

Future stakeholder engagement
The Board regularly reviews the stakeholder
engagement activities undertaken both by it and
the Group as whole and is satisfied that theactivities outlined above and on pages 16 to 18
remain effective for the mutual benefit of theCompany and its stakeholders. Going forward
focus on our people, customers and ourcommunities will remain high in Board’s agenda.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued
Shareholder engagement
The Chairman, the Senior Independent Director
and the Chair of the Audit and Risk Committee will
be available at the Annual General Meeting of theCompany to answer questions from shareholders.
The Board encourages shareholders to attend
as it provides an opportunity to engage with
the Board. However, the 2022 Annual General
Meeting was not held in the usual format as noshareholders were permitted to attend due topandemic-related considerations. The Chief
Executive Officer chaired the meeting with anumber of other Directors, including the
Chairman, as well as members of the Executive
Leadership Team and the statutory auditors
participating remotely.
At the 2022 Annual General Meeting, more than
20% of votes were cast against three resolutions
being the advisory votes on the UK remuneration
report (resolution 7), The Swiss remuneration
report (resolution 9), and the re-election ofCharlotte J. Boyle, Chair of the Remuneration
Committee (Resolution 4.3). In accordance with
Provision 4 of the 2018 UK Corporate Governance
Code, in December 2022 we published an
update on the key actions that have been takenby the Board of Directors and Remuneration
Committee in response to this. In addition to
the comprehensive shareholder consultation
subsequently undertaken, the Chair of theRemuneration Committee has further engaged
with shareholders to understand their feedback
regarding the votes. From this engagement, it isunderstood that the significant factor regarding
the votes was the adjustment, due to the impact
of COVID, of targets contained in the Company’s
incentive arrangements, in particular the original
targets relating to the 2019 Performance SharePlan awards. More information on the actions
taken in response to this vote is included in the
Remuneration Report on page 128.

Pursuant to Swiss law and the Articles of
Association, shareholders annually elect an
independent proxy and we have adopted anelectronic proxy voting system for our Annual
General Meetings.
The Company has a dedicated investor relations
function that reports to the Chief Financial Officer.
Through the investor relations team, theCompany and Board maintain a dialogue withinstitutional investors and financial analysts on
operational financial performance and strategic
direction items. We engaged with the investmentcommunity and our shareholders throughout theyear, as outlined in the diagram below. The
feedback from shareholders has been regularly
considered by the Board and, where necessary,
appropriate action to further engage withshareholders was taken.

Key investor relations activities in 2022

February

November• Europe & UK Management Roadshow• UK Roadshow• Jefferies Miami Consumer Conference• BofA Global Research Consumer & Retail
Conference in Paris• CFO analyst breakfast in London

May• US Management Roadshow

June• Annual General Meeting in Steinhausen• dbAccess Global Consumer Conference 2022

September• Barclays Global Consumer Staples
Conference• Fixed Income Investors Deal Roadshow

CFO analyst breakfast in London
On 10 November 2022, our CFO, Ben Almanzar
and the investor relations team hosted a
breakfast meeting for twenty of our financial
analysts in London. There were insightfulquestions from analysts and a good discussion
on Q3 results and longer-term strategic issues.
The analysts appreciated the opportunity tomeet Ben to hear from him first-hand about
the opportunities and challenges we face asa business. The analyst breakfast was an key
part of the investor relations engagement
programme with this important stakeholder
group. Following the meeting, Ben and theinvestor relations team continued to meetinvestors in London during the Q3 roadshow.

December• Morgan Stanley Global Consumer & Retail
Conference in NYC• Citi’s Global Consumer Conference 2022

111

112

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued
Board, committee and Director
performance evaluation
At least annually, on the basis of an assessment
conducted by the Nomination Committee, theBoard reviews its own performance as well as theperformance of each of the Board committees.
This review seeks to determine whether the Boardand its committees function effectively andefficiently. During the year, the Chairman meetswith the Directors to receive feedback on thefunctioning of the Board and its committees, theboardroom dynamics, and the Group’s strategy.
Particular focus is given to areas where a Director
believes the performance of the Board and its
committees could be improved. A report is
prepared for the Board on its effectiveness andthat of its committees.
For the past seven years, the evaluation of theBoard’s effectiveness has been facilitated by
Lintstock, and details of the 2022 Lintstock report
are set out on page 113. Lintstock has no otherconnection to the Company or individual directors.
A summary of the Board evaluation findings for
2021, the actions taken in response to improve
Board effectiveness in 2022, the Board evaluation
findings for 2022, and the resulting priorities for2023 is as follows:

The independent Directors meet separately at
every regular Board meeting to discuss a variety
of issues, including the effectiveness of the Board.
An evaluation of each Director, other than the
Chairman, is conducted by the Chairman and
the Senior Independent Director. The Senior
Independent Director leads the evaluation of the
Chairman in conjunction with the non-Executive
Directors, taking into account the views of the
Chief Executive Officer, and, as a matter of practice,meets with the other independent non-Executive
Directors when each Board meeting is held todiscuss issues together, without the Chief Executive
Officer or other non-Executive Directors present.
The Chairman also holds meetings with the
non-Executive Directors without the Chief
Executive Officer present.

Information and training
The practices and procedures adopted by our
Board ensure that the Directors are supplied ona timely basis with comprehensive informationon the business development and financial positionof the Company, the form and content of whichis expected to enable the Directors to discharge
their duties and carry out their responsibilities.
All Directors have access to our General Counsel,
as well as independent professional advice at theexpense of the Company.

2021 Board evaluation findings

2022 actions• Strengthening the technology expertiseon the Board• Undertaking site visits and meeting in person• Understanding of broader stakeholder views• Reviewing the acquisitions• Oversight of people and talent• Strategic discussions• Monitoring integration process of Egypt• Holding Board meetings in Italy in order to havemarket visits in the country and meet with local
team members

2022 Board evaluation findings

2023 priorities• Considering macro factors• Managing the conflict between Russia
and Ukraine• Prioritising digital agenda• People and talent• Oversight of risk especially around macro factors• Oversight of people and talent

All Directors have full access to the Chief
Executive Officer and senior management, as wellas the external auditor and internal audit team.
The Board has in place an induction programme
for new Directors. Generally, it involves meetingwith the Chairman, members of the Executive
Leadership Team and other senior executives, aswell as receiving orientation training in relation to
the Group and its corporate governance practices.
The induction programme also includes meetings
with representatives of our sales force, customers
and major shareholders, and visits to our
production plants.
All Directors are given the opportunity to attend
training to ensure that they are kept up to date on
relevant legal, accounting and corporate
governance developments. The Directors
individually attend seminars, forums, conferences
and working groups on relevant topics. The
Nomination Committee reviews our Director
training activities regularly. Finally, as part of thecontinuing development of the Directors, theCompany Secretary ensures that our Board is kept
up to date with key corporate governancedevelopments. The Board appoints the Company
Secretary, who acts as secretary to the Board.

Board appointments and succession
planning
Our Board has in place plans to ensure theprogressive renewal of the Board and appropriate
succession planning for senior management.
These cover the short, medium and long term andthese are regularly reviewed. Appointments andsuccession plans are based on merit and objective
criteria to ensure the Company is promoting
diversity (including gender), social and ethnic
backgrounds, cognitive and personal strengths.

Pursuant to our Articles of Association, the Board
consists of a minimum of seven and a maximumof 15 members, and the Directors are electedannually for a term of one year by the Company’s
shareholders, which is also in accordance with
the UK Corporate Governance Code. In case of
resignation or death of any member of the Board,
the Board may elect a permanent guest, whom
the Board will propose for election by theshareholders at the next Annual General Meeting.
In accordance with the Organisational Regulations,
the Board proposes for election at theshareholders’ meeting new Directors who havebeen recommended by the Nomination
Committee after consultation with the Chairman.
In making such recommendations, theNomination Committee and the Board must
consider objective criteria including the overallbalance of skills, experience, independence andknowledge of the Board member, as well as
diversity considerations including gender but alsosocial and ethnic backgrounds. Consideration is
also given to the overall length of service of theBoard as a whole when refreshing its membership.
See the Nomination Committee report on page
124 for further information on the role and workof the Nomination Committee, including the Board
Diversity Policy. Through this process, the Board
is satisfied that the Board and its committees havethe appropriate balance of experience and skills,
diversity, independence and knowledge of theCompany to enable them to discharge their duties
and responsibilities effectively, including sufficient
time commitment.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued
Conflicts of interest
In accordance with the Organisational Regulations,
Directors are required to arrange their personaland business affairs so as to avoid a conflict ofinterest with the Group.
Each Director must disclose to the Chairman thenature and extent of any conflict of interest arising
generally or in relation to any matter to be
discussed at a Board meeting, as soon as the
Director becomes aware of its existence. In theevent that the Chairman becomes aware of a
Director’s conflict of interest, the Chairman isrequired to contact that Director promptly anddiscuss with him or her the nature and extent ofsuch a conflict of interest. Subject to exceptional
circumstances in which the best interests of theCompany dictate otherwise, the Director affectedby a conflict of interest is not permitted toparticipate in discussions and decision-making
involving the interest at stake.

Lintstock report
In 2022, we once again engaged the advisory firm Lintstock to facilitate an evaluation of the performance of the Board. Lintstock specialises in Board
performance reviews and has no other connection with Coca-Cola HBC.

The first stage of the review involved Lintstock
engaging with the Company Secretary to set thecontext for the evaluation, and to tailor survey
content to the specific circumstances ofCoca-Cola HBC. The surveys were designed
to follow up on and further explore key themes
identified in last year’s evaluation, so thatyear-on-year progress can be tracked.
The 2022 surveys addressed core aspects of theBoard’s performance, and had a particular focus
on the following areas:• The Board’s oversight of progress with regard
to the Company’s growth pillars, and thepriorities for successfully delivering Growth
Story 2025

• The Board’s understanding of, andengagement with, key stakeholder groups,
including shareholders, customers, regulators,
and suppliers• The effectiveness with which the Board
monitors employee sentiment and the culture
throughout the business• The dynamics on the Board, and the extent
to which the Board provides effective support
and constructive challenge to management• The effectiveness of the Board’s meetings,
and the focus in meetings on key strategicareas such as sustainability and technology• The Board’s oversight of risk management,
including the Company’s response to thechallenges associated with the conflict
between Russia and Ukraine• The Board’s exposure to potential successors
for key positions from within the business, andthe effectiveness of the Company’s talentmanagement processes• The Board’s composition in the context of
the Company’s strategic ambitions, including
the skills represented and the diversity
among members
The performance of the committees of theBoard was also evaluated, as was theperformance of the Chairman. The anonymityof all responses was guaranteed throughout theprocess to promote open and honest feedback.

Lintstock subsequently analysed the results and delivered reports on the performance of the Board, the committees and the Chairman, which wereconsidered at a subsequent Board meeting.
The results of the review were positive overall, and the Board was felt tohave performed effectively and maintained a strong working dynamic,
including its response to the Russia-Ukraine conflict. Other priority
areas for 2023 were identified as continuing the Board’s focus on: macro

factors; the integration of recent acquisitions; people issues, including
succession planning and talent; strengthening technology expertise on
the Board; and risk management, including any lessons that can belearned from the conflict between Russia and Ukraine.

113

114

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

The Executive
Leadership
Team

Zoran Bogdanovic

Naya Kalogeraki

Ben Almanzar

Ivo Bjelis

Appointed: December 2017

Senior management tenure: Appointed
July 2016 (6 years), appointed Chief
Operating Officer September 2020

Senior management tenure: Appointed
April 2021 (1 year)

Senior management tenure: Appointed
January 2022 (1 year)

Previous Group roles: Chief Customer andCommercial Officer from 2016 to 2020.
From 1998, when Naya joined the Company,
she built her career assuming roles ofincreased scale and scope, including
Marketing Director, Trade Marketing
Director, Sales Director and Country
Commercial Director, Greece. She has beenheavily involved in Group strategic projects
and task forces addressing mission-criticalbusiness imperatives. In September 2013,
Naya was appointed to the role of General
Manager, Greece and Cyprus.

Previous Group roles: None
Previous relevant experience: Ben has aproven track record and broad experience
gained from senior financial positions in the
global fast-moving consumer goods
industry. This includes 10 years with Mars
Incorporated, where he was Regional CFO,
Europe & Southern Africa and most recently
Vice President for Financial Planning,
Analytics and Financial Strategy. Prior tojoining Mars, Ben spent 10 years with Nestlé
in a variety of finance roles in Europe,
including CFO of Nestlé Czech-Slovak, and
CFO for Nestlé Waters in the UK.

Previous Group roles: Ivo joined the Groupin 1996 as Plant Manager in Croatia, while in2002 he took over the position of Country
Supply Chain Manager. Since 2006 Ivo built
his career assuming roles of increased scaleand scope across the board, including
Strategic Initiative Leader for Customer
Centric Supply Chain, Group Supply Chain
Processes and Capabilities Director,
Regional Supply Chain Director, Group
Supply Chain Services Director and Group
Supply Chain Operations Director, leading
the development and the transformation of
the Supply Chain strategy over the years.

Chief Executive Officer, Executive Director
Zoran was previously the Company’s Region
Director responsible for operations in 12
countries and has been a member of the
Executive Leadership Team since 2013. He
joined the Company in 1996 and has held anumber of senior leadership positions,
including as General Manager of theCompany’s operations in Croatia,
Switzerland and Greece. Zoran has a trackrecord of delivering results across our
territories and demonstrating the values thatare the foundation of our Company culture.
Nationality: Croatian(53) Chief Operating Officer

Previous relevant experience: Naya joined
the Company in 1998 from The Coca-Cola
Company where she held a number ofmarketing positions up to Marketing
Manager.
Nationality: Greek(48) Chief Financial Officer

Nationality: Dominican Republic and British(55) Chief Supply Chain Officer

Nationality: Croatian

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

Sanda Parezanovic(58) Chief People and Culture Officer
Senior management tenure: Appointed
June 2015 (7 years)
Previous Group roles: Sanda’s previous
roles in the Group include: Public Affairs &Communications Manager, Serbia andMontenegro from 2003 to 2006; Country
Human Resources and Public Affairs &Communications Manager, Serbia andMontenegro from 2006 to 2010; and Region
Human Resources Director, Bosnia &Herzegovina, Bulgaria, Croatia, Cyprus,
Greece, Northern Ireland, the Republic of
Ireland, North Macedonia, Moldova,
Montenegro, Nigeria, Romania, Serbia andSlovenia from 2010 to 2015.
Previous relevant experience: Sanda
started in 1989 as Market Researcher andlater Strategic Planner working for various
local research and marketing agencies in SFR
Yugoslavia. She joined Saatchi & Saatchi
Balkans in 1994, holding various senior
management positions in several Balkancountries, including Managing Director of
two start-up agencies, first in North
Macedonia and later in Serbia. In 1999 she
relocated to London, where she worked for
Saatchi & Saatchi and Marketing Drive on anumber of pan‑European and businessdevelopment projects before she joined ourGroup in 2003.
Nationality: Serbian

Jan Gustavsson

Marcel Martin

Minas Agelidis

Senior management tenure: Appointed
August 2001 (21 years)

Senior management tenure: Appointed
Chief Supply Chain Officer January 2015,
appointed Chief Corporate Affairs &Sustainability Officer January 2022 (8 years)

Senior management tenure: Appointed
April 2019 (3 years)(57) General Counsel, Company Secretary
and Chief Corporate Development Officer

Previous Group roles: Jan served as Deputy
General Counsel for Coca‑Cola Beverages
plc from 1999 to 2001.
Previous relevant experience: Jan started
his career in 1993 with the law firm White &Case in Stockholm, Sweden. In 1995, hejoined The Coca‑Cola Company as AssistantDivision Counsel in the Nordic and NorthernEurasia Division. From 1997 to 1999, Jan was
Senior Associate in White & Case’s New York
office, practising securities law and M&A.
Nationality: Swedish(64) Chief Corporate Affairs andSustainability Officer

Previous Group roles: Marcel joined theGroup in 1993, holding positions withincreasing responsibility in the supply chain
and commercial functions. Since 1995, he
has held general management assignments
in several of our markets, including as
General Manager for Eastern Romania,
Regional Manager Russia, Country General
Manager Ukraine and General Manager
Nigeria. He became General Manager of our
Irish operations in 2010, Supply Chain
Director in 2015 and is now our Chief
Corporate Affairs and Sustainability Officer.
Nationality: Romanian(53) Region Director: Austria, Belarus, Czech
Republic, Estonia, Hungary, Island of Ireland,
Latvia, Lithuania, Poland, Slovakia,
Switzerland

Previous Group roles: Minas joined theGroup in 1999, holding positions withincreasing responsibility in the commercial
function in Greece (National AccountManager, Athens Region Sales Manager,
National Wholesale Manager, Country Sales
Director). Since 2008, Minas has held generalmanagement assignments in a number ofour markets, including those of Country
General Manager Cyprus, Country General
Manager Bulgaria and Country General
Manager Hungary.
Previous relevant experience: Prior tojoining the Group, Minas spent seven years
at Unilever Greece in managerial positions insales and marketing including those of Brand
Manager, Trade Marketing Manager andNational Account Manager.
Nationality: Greek

Nikos Kalaitzidakis(54) Region Director: Armenia, Bosnia &Herzegovina, Bulgaria, Croatia, Cyprus,
Greece, Moldova, Montenegro, Republic ofNorth Macedonia, Romania, Serbia, Slovenia,
UkraineSenior management tenure: Appointed
May 2018 (4 years)
Previous Group roles: Nikos joined theGroup in 2006 as Regional Manager for
Northwest Russia and then moved toGeneral Manager roles in Croatia (2008),
Bulgaria (2010), Hungary (2013) and Poland(2014).
Previous relevant experience: Prior tojoining the Group, Nikos spent five years intechnology and telecommunications andseven years with Phillip Morris International invarious roles and geographies across Europe
and Central Asia.
Nationality: Greek

115

116

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

Executive Leadership Teamgender diversity

Barbara Tönz

(52) Chief Customer and Commercial Officer
Senior management tenure: Appointed
May 2021 (1 year)
Previous Group roles: Barbara joined theGroup in 1998, building her career first in
Switzerland as Trade Marketing Director,
Sales Director and Commercial Director, andthen in Austria from 2012 as Commercial
Director and Interim General Manager.
Previous relevant experience: In 2016
Barbara enriched her experience within the
Cola-Cola System as Country Director
Sweden for The Coca-Cola Company, withresponsibility expanded to Norway and
Iceland in 2019 before she assumed the roleof Commercial Execution Director Europe.
Prior to joining the Group in 1998, she held
positions in brand and customer
development at Unilever.
Nationality: Swiss

Vitaliy Novikov(43) Digital Commerce Business
Development Director
Senior management tenure: Appointed
September 2020 (2 years)
Previous Group roles: Vitaliy joined theGroup in 2011 as General Manager of theBaltics business unit. Since then, he has held
General Manager roles in Poland and Italy.
Previous relevant experience: Prior tojoining the Group, Vitaliy spent four years at
Johnson & Johnson as Managing Director of
the Ukrainian operation and prior to this hespent seven years at Henkel in managerial
positions of growing responsibility in Austria
and Ukraine.
Nationality: Ukrainian

Mourad Ajarti

Spyros Mello

Senior management tenure: Appointed
October 2019 (3 years)

Senior management tenure: Appointed
November 2021 (1 year)

Previous Group roles: None.

Previous Group roles: Spyros served as
Deputy General Counsel and Chief
Compliance Officer from 2010 to 2021. He
was Deputy General Counsel from 2007 to2009 and Senior Corporate Counsel from2005 to 2007.

(46) Chief Digital and Technology Officer

Previous relevant experience: Mourad
holds an MSc in Computer Systems
Networking & Tele-communications from
L’École Mohammadia d’Ingénieurs. He has
20 years’ experience with two fast-moving
consumer goods industry leaders, Procter &Gamble and L’Oréal. Mourad started with
Procter & Gamble leading SAP
implementation in Morocco, Saudi Arabia
and Europe, and later was CIO for different
lines of business. From 2014 to 2019,
Mourad was CIO for the Asia and Pacificregion for L’Oréal, leading consumer andcustomer journey transformation andenabling the use of big data and advanced
analytics.
Nationality: British and Moroccan(48) Strategy and Transformation Director

Previous relevant experience: Spyros wasan associate with the law firm of Sullivan &Cromwell LLP practising securities law and
M&A first in New York from 1999 to 2001 andthen in London from 2001 to 2004.
Nationality: Greek

Men
Women

10
3

Executive Leadership Team tenure(years)
1-2
2-3
3-4
6-7
7-8
9-10
21-22

4
3
1
2
1
1
1

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

Key responsibilities of the Executive Leadership TeamKey activities and decisions in 2022

The key responsibilities and elements ofthe Executive Leadership Team role are:• the day-to-day executive managementof the Group and its businesses, including
all matters not reserved for the Boardor other bodies;• the development of Group strategies andimplementation of the strategies approvedby the Board;• providing adequate head-office support
for each of the Group’s countries;

Long-term direction setting• Supporting the redesign of the Company’s
new leadership model, purpose and values.
• Assessing, approving and reviewing key
initiatives related to processes and projects
optimization (project Oxygen).
• Evaluating and evolving our 24/7 portfolio
strategy together with our brand partners.
• Reviewing Coffee expansion across theGroup’s markets.
• Assessing our sustainability priorities
and initiatives on the way to deliver
2025 commitments.
• Setting long-term capability building
priorities and programmes.
• Approving and reviewing deploymentof major automation and digitalisation
initiatives.

• setting of annual targets and approval ofannual business plans which form the basisof the Group’s performance management,
including a comprehensive programmeof strategies and targets agreed between
the Country General Managers and theRegional Directors;• working closely with the Country General
Managers, as set out in the Group’s
operating framework, in order to capture
benefits of scale, ensuring appropriate
governance and compliance, and managing
performance of the Group; and• leading the Group’s talent and capability
development programmes.

Business planning• Aligning key priorities and investment
strategy with TCCC.
• Aligning key priorities with strategic partners– Monster Energy, Premium Spirit andCoffee partners.
• Reviewing progress of the aligned priorities,
investments and spending.
• Reviewing and approving annual businessplans for 2023 for all operations andcentral functions.
• Approving Group and country talent,
capabilities development andsuccession plans.

Risk, safety and business resilience• Evaluating the Group’s businessresilience strategies.
• Evaluating and strengthening Group’s
Incident Management and Crisis
Resolution capabilities.
• Evaluating the Group’s Risk Register of major
business risks as well as associated risk
response plans.
• Reviewing the Group’s health & safety
policies and material incidents.
• Reviewing the corporate audit plan for 2023.
Business case reviews and approvals• Reviewing and approving progress of
selected key initiatives – Data, Insights& Analytics (DIA), Digital Commerce, Digital& Technology, Sustainability, Diversity& Inclusion (D&I) and Culture.
• Overseeing the strategic evolution of Supply
Chain, Human Resources, Commercial,
Finance and BSS departments.
• Capital expenditure proposals review
and approval.
Priority projects• Oxygen Strategic Projects• Culture – redesign of new company
PURPOSE, Values and leadershipcompetencies• Customer Satisfaction (External and internalclient satisfaction via NPS)
• Sustainability initiatives• Engagement• Diversity & Inclusion• Cybersecurity• Business Resilience• Venturing• eCommerce tools

117

118

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

Monitoring liquidity
and emerging risks
Letter from the Chair of the Audit and Risk Committee
Highlights this year
• Risk management response to theRussia-Ukraine conflict.
• Integration of Egypt.
• Monitoring of Cyber Security Program.

Priorities for 2023
• monitoring the developments inaccounting and regulatory matters,
including potential changes to IFRS
accounting standards and respective
disclosures;• ongoing monitoring of risks as well as
impairment testing of goodwill andintangible assets;• ongoing monitoring of internal financial
controls, anti-fraud systems and Codeof Business Conduct compliance; and• ongoing monitoring of the Group’s
enterprise risk management and quality
assurance, and information systemsecurity processes• overview of the Egypt integration
process and related controls and risk
management.

Dear Stakeholder
The Audit and Risk Committee focused
its work during 2022 on enhancing andstrengthening the Group’s existing
financial controls, risk management andcompliance systems, which the Board
recognises as essential components ofeffective corporate governance. During2022, the Audit and Risk Committee
worked closely with the internal audit
and finance teams in overseeing theimplementation of the Group’s internal
control framework and addressing
issues related to the Russia andUkraine conflict.
Conflict between Russia and Ukraine
The conflict between Russia and Ukraine continues
to affect our business in those countries withsome continuing impact on our supply chain. In
March 2022, The Coca-Cola Company announced
that it was suspending its business in Russia which
has had, and will continue to have, a significant
impact on our business in Russia. The Group has
adjusted its Russian business to focus on local
brands. The conflict created a number of risks
for the Group, including, in particular, health andsafety risks for our people in Ukraine and increased
commodity prices and inflation for our operations
in Ukraine and beyond. We expect the geopoliticalenvironment to remain volatile for some time.
We have monitored and discussed our risk
management processes, including our risk profileand mitigation but also principal risks and risk
appetite. The Audit and Risk Committee reviewed
updates on new auditing standards, accounting
developments and regulatory developments,
including a public statement by the European
Securities Markets Authority (ESMA) promoting
transparency about the impact of the conflict
between Russia and Ukraine. As a result of theconflict, revisions to the 2022 audit plan were made.

Emerging risks identified by the Group werediscussed by the Audit and Risk Committee,
including Russia-Ukraine related risks and thedeteriorating macroeconomic environment.
Other areas of focus during 2022 are included in
the sections about the work and activities of the
Audit and Risk Committee and the areas of key
significance in the preparation of the Financial
Statements in this report.
The Audit and Risk Committee report describes
in more detail the work of the Audit and Risk
Committee during 2022. In performing its work,
the Committee balances independent oversightwith support and guidance to management. I am
confident to report that the Committee, supported
by senior management and the external auditor,
consistently carried out its duties to a highstandard during the reporting year.

William W. (Bill) Douglas III
Committee Chair

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued
Role and responsibilities
The Audit and Risk Committee monitors theeffectiveness of our financial reporting, internal
control and risk management systems, andprocesses. The role of the Audit and Risk
Committee is set out in the charter for thecommittees of the Board of Directors in Annex C
to the Company’s Organisational Regulations.
This is available at https://www.coca-colahellenic.
com/en/about-us/corporate-governance. The
key responsibilities and elements of the Audit andRisk Committee’s role are:• providing advice to the Board on whether the
Annual Report including the consolidated
Financial Statements, taken as a whole, is a fair,balanced and understandable assessment of
the Company’s position and prospects andprovides the information necessary forshareholders to assess the Group’s positionand performance, including whether there isconsistency throughout the report including thefinancial reporting, whether the report will forma good basis of information for theshareholders, and that important messages arehighlighted appropriately throughout the report;• monitoring the quality, fairness and integrity of
the consolidated Financial Statements of theGroup, and reviewing significant financial reporting
issues and judgements contained in them;• reviewing the Group’s internal financial control
and anti-fraud systems as well as the Group’s
broader enterprise risk management and legal
and ethical compliance programmes (including
computerised information system controls andsecurity) with the input of the external auditor
and the internal audit department;• reviewing and evaluating the Group’s major
areas of financial risk and the steps taken tomonitor and control such risk, as well as
guidelines and policies governing risk
assessment; and• monitoring and reviewing the external
auditor’s independence, quality, adequacyand effectiveness, taking into consideration therequirements of all applicable laws in Switzerland
and the UK, the listing requirements of the
London Stock Exchange and Athens Stock
Exchange, and applicable professional standards.
Members

Membership status

William W. (Bill)
Douglas‑III (Chair)
Olusola (Sola)
David‑Borha
Alexandra
Papalexopoulou

Member since 2016
Chair since 2016
Member since 2015
Member since 2020

The Audit and Risk Committee comprises three
independent non-Executive Directors: Bill Douglas(Chair), Olusola (Sola) David-Borha and Alexandra
Papalexopoulou, who were each re-elected for a
one-year term by the shareholders at the Annual
General Meeting (AGM) in June 2022.
The Board remains satisfied that Bill Douglas,
Sola David-Borha and Alexandra Papalexopoulou
possess recent and relevant financial and sector
experience in compliance with the UK Corporate
Governance Code. Bill Douglas was formerly
Executive Vice President and Chief Financial
Officer of Coca-Cola Enterprises, Sola DavidBorha has held a number of senior financial
positions and Alexandra Papalexopoulou has
served as a treasurer. The Board is also satisfied
that the members of the Committee as a whole
have competence in the sector in which theCompany operates in compliance with the UK
Corporate Governance Code and UK listing
regime requirements.
Further details on their experience are set out intheir respective biographies on pages 98 to 100.

The Group Chief Financial Officer, as well as theGeneral Counsel, external auditor, the Head ofCorporate Audit, and the Group Financial
Controller, normally attend all meetings of the
Audit and Risk Committee. Other officers andemployees are invited to attend meetings whenappropriate. Two non-Executive Directors,
Henrique Braun and Christo Leventis were invited
to attend all meetings during 2022. The Head ofCorporate Audit, and, separately, the external
auditor, meet regularly with the Audit and Risk
Committee without the presence of management
to discuss the adequacy of internal controls overfinancial reporting and any other matters deemed
relevant to the Audit and Risk Committee. The
Chair of the Audit and Risk Committee attended
our AGM in June 2022 and regularly interacts withrepresentatives of our shareholders.

Work and activities
The Audit and Risk Committee met eight times,
four of which were by video conference call, during2022 and discharged the responsibilities defined
under Annex C of the Organisational Regulations.
The work of the Audit and Risk Committee during
the accounting year included evaluation of andreview of the respective matters, as well as
assessment of management’s mitigating actions
and response plans, in the areas below:• the Integrated Annual Report including theconsolidated Financial Statements and thefull-year results announcement for the year
ended 31 December 2021 prior to theirsubmission to the Board for approval, andcompliance with Group policies;• the interim consolidated Financial Statements
and interim results announcement for thesix-month period ended 1 July 2022, prior totheir submission to the Board for approval;• the trading updates for the three-month period
ended 1 April 2022 and the nine-month period
ended 30 September 2022;• areas of significance in the preparation of theconsolidated Financial Statements;• the internal control environment, principal risks
and risk management systems (including thenature and extent of the principal risks resulting
from the conflict in Russia and Ukraine), and theGroup’s statement on the effectiveness of its
internal controls prior to endorsement by the
Board, concluding that management has carriedout a robust risk assessment process;• the Viability Statement scenarios and underlying
assumptions and recommendations to theBoard that the Viability Statement be approved,
including discussion of management’s
conclusions with respect to Going Concern
and the Viability Statement;• the external auditor’s report on the Group’s
IFRS earnings release for the financial year
ended 31 December 2021; including
assessment of the auditor’s enhanced audit
report and key audit matters and conclusionthat there was nothing that warranted theattention of the Board; and review of external
auditor’s report on the Group’s interim reportfor the six-month period ended 1 July 2022;• report on tax audits undertaken during 2022
in a number of territories;• quarterly reports on internal audit matters acrossthe Group’s business regions, concluding that nomaterial failings were identified;• consideration and discussion of the guidance
to FRC’s Practice Aid on audit quality;• direct procurement matters and initiatives for
2022, including the Group’s commodities risk
management initiatives for 2022;• regular reports on health and safety, GDPR
compliance, cybersecurity, business continuity,
security, quality assurance, environmental
protection, asset protection, treasury andfinancial risks, anti-bribery and fraud control,
insurance (including placing strategy),
enterprise risk management processes andinternal control framework (including any
adjustments to the 2022 schedule and updates
to the controls as a result of the conflict
between Russia and Ukraine);

119

120

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued• progress on internal control assessment andintegration of newly acquired CCBCE;• reports on litigation and regulatory
investigations;• matters arising under the Group’s Code ofBusiness Conduct and the actions taken toaddress any identified issues;• an external quality assessment of the internal
audit function, in accordance with the Instituteof Internal Auditors Attribute Standards 1312;• an assessment of the skills of the internal
auditors and the sufficiency of the internal audit
budget, confirming of the Internal Auditor’squality, experience and expertise for thebusiness. The Audit & Risk Committee issatisfied that internal audit has the appropriate
resources for the business;• updates on risk management and businessresilience, including the Group’s response to theconflict between Russia and Ukraine, theactivation and development of BusinessContinuity strategies and the streamlining of
the Group’s risk management processes.
Review of the Group’s Principal Risks and theGroup’s updated Strategic Risk Summary;• reports on the Group’s impairment assessment
processes in connection with the operations
affected by the conflict between Russia andUkraine for the interim financial report;• regular updates from the external auditor on
accounting and regulatory developments. Also,
an update on Swiss regulatory developments,• tax issues including:– developments with the OECD Pillar 2 project;– reviewing current challenges and risk areas for
the Group, including, the entering into forceof sweeping changes to Polish withholding
tax regulations, ongoing tax audits in Russia
and Poland and an arbitration under the EU
Arbitration Convention involving the Romanianand Dutch tax authorities;– a review of the tax disputes in Italy, Nigeria
and Romania;– an update on the tax integration of CCBCE; and– a summary of all open tax audits involving
the Group.
• approval of changes to chart of authority
and delegation for operational activities;• external audit plan and pre-approval of audit
fees for 2023;• consideration of the external auditor’s
independence, quality, adequacy andeffectiveness of its audit of the financial
statements; and• assessed the Company’s external reporting toensure it is fair, balanced and understandable
as a result of the Board’s obligation under the
Corporate Governance Code. The Audit andRisk Committee was responsible for the reviewof the 2022 Integrated Annual Report including
the Consolidated Financial Statements
and associated reports and information.
The Committee received assurances frommanagement and details on the processes
underlying the preparation of publishedfinancial information.
Following evaluation of all available information,
the Audit and Risk Committee concluded andadvised the Board that the 2022 Integrated
Annual Report including the Consolidated
Financial Statements is fair, balanced andunderstandable.
In November 2022 the Group received a request
for information from the Financial Reporting
Council (‘FRC’) following their review of the Group’s
annual report and accounts to 31 December 2021.
The FRC asked questions in the areas of impairment
testing, taxation and contributions from The
Coca-Cola Company, to which we have responded
by enhancing our relevant disclosures in the 2022
annual report and accounts. The FRC’s review wasconcluded in February 2023. The FRC’s review isintended to consider compliance with reporting
requirements and is conducted by staff who
have an understanding of the relevant legal andaccounting framework, however lacking detailed

knowledge of the Group’s business or understandingof the underlying transactions entered into. As such,
the FRC’s review provides no assurance that theGroup’s reports and accounts are correct in allmaterial respects and it should not be relied uponby the Group or any third party.
Finally, the Board receives and reviews a reportfrom the Audit and Risk Committee on its
activities and discussions at the Board meeting
following each Audit and Risk Committee meeting.

Areas of key significance in the
preparation of the Financial Statements
The Audit and Risk Committee considered anumber of areas of key significance in the
preparation of the Financial Statements in 2022,
including the following:• appropriateness of critical accounting
judgements and estimates that affect thereported amounts of assets, liabilities, revenues
and expenses, and the disclosure of contingent
assets and liabilities in the consolidated Financial
Statements (detailed in Notes 5,14,16,22 and
30 to the consolidated financial statements),
identified by management;• review of the trading environment and resilienceof the Group’s business in light of the conflict
between Russia and Ukraine and strategic
actions implemented to mitigate risks andrestructure business operations;• review of impairment testing performed bymanagement and reviewed by the external
auditor under IAS 36 as well as the relatedsensitivity analysis with confirmation thatmanagement had undertaken a robust
impairment testing process, relying on bothinternal information, and other publicly available
metrics to perform their assessment; review
key assumptions for specific countries,
challenging management drivers of relevant
deviations and performance to date, as well as
countries WACC rates development vs prior year;• review of the contingencies, legal proceedings,
competition law and regulatory procedures,
including cases involving the national
competition authorities of Greece and litigation
matters in Nigeria and Greece, and the impactof these on the consolidated Financial
Statements and accompanying notes;• assessment of management’s judgement on
relevant areas for additional disclosures, toaddress IAS 34 requirement for explanation ofsignificant events in light of the conflict between
Russia and Ukraine;• review of accounting standard IAS 34 that
required an explanation of significant events
implying that additional disclosure should bemade to reflect the financial impact of theconflict between Russia and Ukraine andmitigating measures;• review of guidance provided from the UK
Financial Conduct Authority and Financial
Reporting Council related to areas of focus
for the 2022/2023 reporting season, including
financial reporting, sustainability and climaterelated disclosures, TCFD disclosures, viability
and going concerns, corporate governancematters and The European Single Electronic
Format standard;• review of interim judgements performed bymanagement and in alignment with the external
auditor, regarding the impairment of indefinitelived intangibles in light of the conflict between
Russia and Ukraine;• assessed management’s work in conducting
a robust assessment of the risks that impact
the Viability and Going Concern Statements,
including review of scenarios andunderlying assumptions;• recommended to the Board to approve theViability Statement; and• deemed appropriate that the Group continues
to apply the going concern basis for the
preparation of the financial statements.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued
External auditor
PricewaterhouseCoopers AG, Birchstrasse 160,
CH 8050 Zurich, Switzerland (PwC AG) has been
elected by the shareholders as the statutory
auditor for the Group’s statutory consolidated andstandalone Financial Statements. The signing
partner, for the second year, for the statutory
Financial Statements on behalf of PwC AG is
Sandra Boehm Uglow, for the year ended 31
December 2022.
The Board, at the recommendation of the
Audit and Risk Committee, has retainedPricewaterhouseCoopers S.A., 268 Kifissias
Avenue – 15232 Halandri, Greece (‘PwC S.A.’),an affiliate of PwC AG, to act as the Group’s
independent registered public accounting firm
for the purposes of reporting under the UK rules
for the year ended 31 December 2022. For thesecond year, the signing partner, the Financial
Statements (for the year ended 31 December2022) on behalf of PwC S.A. is Fotis Smyrnis.
The appointment of PwC has been approved by
the shareholders until the next Annual General
Meeting by way of advisory vote. ‘PwC’ refers
to PwC AG or PwC S.A., as applicable, in thisAnnual Report.
During the accounting period, the members of the
Audit and Risk Committee met on a regular basiswith the appointed PwC signing partners, bothwith and without management being present. This
provided the Audit and Risk Committee with anopportunity for open dialogue, to question and besatisfied as to the quality of the audit work
performed by PwC and challenge PwC’s
professional skepticism.

During the meetings, the appointed PwC signing
partners demonstrated their understanding of thegroup’s business risks and the consequential
impact on the financial statement risks, especiallyaround areas of key significance in the preparationof the Financial Statements including but notlimited to the trading environment and resilienceof the Group’s business in light of the conflict
between Russia and Ukraine, the annual
impairment testing, contingencies and legal
proceedings including taxes. The Audit and Risk
Committee took an active role in reviewing thescope of the audit, the independence, objectivity
and effectiveness of PwC, and the negotiations
relating to audit fees. The Audit and Risk
Committee also met with the management team,which led the discussions with PwC, including
the Head of Corporate Audit, to review theperformance of PwC without PwC being present.
Following this review process, the Audit and Risk
Committee has recommended to the Board that a
proposal to reappoint PwC be put to a shareholders’vote at the next Annual General Meeting.
PwC has acted as the Group’s principal external
auditor since 2003. The Company ran acompetitive tender for the external auditor
services in 2015 which was overseen by the Audit
and Risk Committee. Following the evaluationof the proposals, the Audit and Risk Committee
concluded in 2015 that the best interests of theGroup and its shareholders would be served byretaining PwC as external auditor and made such
recommendation to the Board. PwC wasreappointed by the Board as the Group’s external
auditor with effect from 11 December 2015.
Currently, the Audit and Risk Committee
anticipates that the audit contract will be put out
to tender again in 2025. There are no contractualor other obligations restricting the Group’s choiceof external auditor.

Non-audit services provided by theexternal auditor
The Audit and Risk Committee considers theindependence, in both fact and appearance, of theexternal auditor as critical and has long had anauditor independence policy providing definitionsof the services that the external auditor may andmay not provide. In line with the relevant FRC
Guidance, the policy requires the Audit and Risk
Committee’s pre-approval of all audit andpermissible non-audit services provided by theexternal auditor, and only for matters that areclearly trivial to the Company. Such services
include audit, work directly related to audit, andcertain tax and other services as further explained
below. In practice, the Audit and Risk Committee
applies the policy restrictively, and approval forwork other than audit and audit-related services
is rarely granted.
Under the policy, pre-approval may be provided
for work associated with: statutory or otherfinancial audit work under IFRS or according tolocal statutory requirements; attestation services
not required by statute or regulation; accounting
and financial reporting consultation and research
work necessary to comply with generally accepted
accounting and auditing standards; internal control
reviews and assistance with internal control
reporting requirements; review of information
systems security and controls; tax complianceand related tax services, excluding any tax services
prohibited by regulatory or other oversightauthorities; expatriates’ and other individual tax
services; and assistance and consultation onquestions raised by regulatory agencies.
For each proposed service, the external auditor isrequired to provide detailed back-up documentation
at the time of approval to permit the Audit andRisk Committee to make a determination whether
the provision of such services would impair theexternal auditor’s independence.
PwC has complied with the policy for the financial
year ended on 31 December 2022.

Audit fees and all other fees
Audit fees
The total fees for audit services to PwC andaffiliates were approximately €6.2 million for theyear ended 31 December 2022, compared toapproximately €4.8 million for the year ended 31
December 2021. The total fees for 2022 include
fees associated with the annual audit and reviewof the Group’s half-year reports, prepared inaccordance with IFRS and local statutory audits.
Fees for audit services to firms other than PwC
and affiliates were €0.7 million for the year ended
31 December 2022 (2021: € nil).
Audit‑related fees
Fees for audit-related services to PwC andaffiliates for the year ended 31 December 2022
were €1.1 million, compared to €0.7 million for theyear ended 31 December 2021.
Tax‑related fees
There were no fees to PwC and affiliates for tax
services for the years ended 31 December 2022
and 2021.
All other fees
There were no fees were to PwC or affiliates
for non-audit services for the years ended
31 December 2022 and 2021.
Risk management
During 2022, the Company continued to revise
and strengthen its approach to risk management
as described in detail on pages 61-81. The primary
aim of this framework is to minimise our exposureand ensure that the nature and significance of allrisks we are facing are properly identified, reviewed,
managed and, where necessary, escalated. Risk
assessments are conducted and discussed atmonthly Senior Leadership Team meetings in all
our business units. These assessments are reviewed
by regional management teams and the Chief Risk
Officer twice a year. In addition, corporate functions
conduct broader risk assessments across thebusiness with the Chief Risk Officer biannually.

121

122

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued
The Company’s Group Risk and Compliance
Committee reviews the emerging as well as theidentified risks biannually and the emerging andmaterial risks as well as mitigating actions arepresented by the Chief Risk Officer to Executive
Leadership Team and the Audit and Risk Committee.
This process is both top-down and bottom-up
and is designed to ensure that risks arising frombusiness activities are appropriately managed.
The Audit and Risk Committee confirms that therisk management and internal control systems
have been in place for the year under review
and up to the approval of the annual report andaccounts. Finally, we have in place third-party
insurance to cover residual insurable risk exposuresuch as property damage, business interruption
and liability protection, including Directors’ andofficers’ insurance for our Directors and officers,
as well as for the officers and directors ofcertain subsidiaries.
Internal control
The Board has ultimate responsibility for ensuringthat the Company has adequate systems offinancial reporting control. Systems of financial
reporting control can provide only reasonable
and not absolute assurance against material
misstatements or loss. In certain of the countries
in which we operate, our businesses are exposed
to a heightened risk of loss due to fraud andcriminal activity. We review our systems of financial
control regularly in order to minimise such losses.
Internal audit
Our internal audit function reports directly to the
Audit and Risk Committee, which reviews andapproves the internal audit plan for each year. Theinternal audit function consists of approximately
40 full-time professional audit staff mainly basedin Athens, Sofia, Moscow and Lagos, covering a
range of disciplines and business expertise.

One of the responsibilities of the internal audit
function is to provide risk-based and objective
assurance to the Board as to whether the Group’s
framework of risk management, including internal
control framework, is operating effectively.
For this purpose, the Head of Corporate Audit
makes quarterly presentations to the Audit andRisk Committee and meets regularly with the
Audit and Risk Committee without the presenceof our management.

The Board has adopted a chart of authority,
defining financial and other authorisation limits
and setting procedures for approving capital andinvestment expenditure. The Board also approvesdetailed annual budgets. It subsequently reviews
quarterly performance against targets set forthin these plans and budgets. A key focus of thefinancial management strategy is the protectionof our earnings stream and managementof our cash flow.

In addition, the internal audit function reviews
the internal financial, operational and compliance
control systems across all the jurisdictions inwhich we operate and reports its findings tomanagement and the Audit and Risk Committee
on a regular basis.

We have conducted an annual review of theeffectiveness of our risk management system
and internal control systems in accordance with
the UK Corporate Governance Code. The review
included bi-annual reviews with the Chief Risk
Officer on the operation of the ERM program,
regular review of our financial operations andcompliance controls and consideration of theCompany’s principal risks. Part of this review
involves regular review of our financial, operationaland compliance controls, following which wereport back to the Board on our work and findings
as described above. This allowed us to provide
positive assurance to the Board to assist it in
making the statements that our risk management
and internal control systems are effective, as
required by the UK Corporate Governance Code.
Further information is set out on pages 96-97.

The internal audit function focuses its work on
the areas of greatest risk to us, as determinedby a risk-based approach to audit planning.
As part of our commitment to maintaining
and strengthening best practice in corporate
governance matters, we also consistently seek
to enhance our internal control environmentand risk management capability.
The internal audit function carries out work acrossthe Group, providing independent assurance,
advice and insight to help the organisationaccomplish its objectives by bringing a systematic,
disciplined approach to evaluating and improving
the effectiveness of risk management, control andgovernance processes. In December 2022, theAudit and Risk Committee agreed the FY23 audit
plan to be undertaken by the internal audit team.
The audit plan coverage is based on risk, strategic
priorities and consideration of the strength of thecontrol environment. The internal audit function
prepares audit reports and recommendations
following each audit, and appropriate measures
are then taken to ensure that all recommendations
are implemented. Significant issues, if any, areraised at once. There were no such issues in 2022.

The key features of the Group’s internal control
systems that ensure the accuracy and reliability offinancial reporting include: clearly defined lines ofaccountability and delegation of authority; policies
and procedures that cover financial planning andreporting; preparation of monthly management
accounts; and review of the disclosures within the
Annual Report from function heads to ensure thatthe disclosures made appropriately reflect thedevelopments within the Group in the year andmeet the requirement of being fair, balanced
and understandable.

The Audit and Risk Committee reviews the resultsof the internal audit reports during each meeting,focusing on the key observations of any reports
where processes and controls require
improvement. The Audit and Risk Committee wasalso provided with updates on the remediation
status of management actions of internal audit
findings and on the internal audit quality assurance
and improvement programme at each meeting.
A particular focus during 2022 was the robustnessof the internal control systems and processes
around risk management, in light of the conflict
between Russia and Ukraine. The Audit and Risk
Committee was kept informed of any changes oradaptations to ensure full functionality as theCompany continued to operate under thecircumstances and uncertainties of the conflict
between Russia and Ukraine.
The Group Chief Financial Officer, the Head ofFinance Operations, Country General Managers
and Country Chief Financial Officers have accessto the implementation status of therecommendations at all times.
Where internal or external circumstances give riseto an increased level of risk, the audit plan ismodified accordingly. Nevertheless, no significant
cases occurred this year. Any changes to theagreed audit plan are presented to and agreed by
the Audit and Risk Committee. As a result of theconflict between Russia and Ukraine, revisions
were made to the audit plan, including freezing
audit activities in Ukraine, Armenia and Moldova
and deferring the Russia risk-based audit.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued
Whistleblowing measures
Business ethics and anti‑corruption
We seek to grow our business by serving
customers and consumers, and conduct all
business activities with integrity and respect.
The Board is responsible for ensuring appropriate
procedures and processes are in place to enable
our workforce to raise any issues of concern andis satisfied that the processes in place areappropriate. The Board maintains zero-tolerance
regarding breaches of our Code of BusinessConduct and anti-bribery policies, as well as any
attempts to retaliate against our people whoreport potential violations.
We have mandatory training for all our people,
including our executive leadership team, so thateveryone understands our Code of BusinessConduct, and we hold additional targetedanti-bribery training for employees working inareas we assess as high risk. A Code of BusinessConduct and Anti-Bribery Policy course is available
on-line to all employees and includes a knowledge
test, acknowledgement and re-commitment tocompliance with the Code and its related policies.
At the end of last training wave in 2021, 26,319
employees passed the course, which was 97.7%
of total active population. Since then, we continued
to train every newly hired employee. In 2022 n.
9.937 more employees were trained, including
n. 5908 employees in the newly acquired Egypt
BU. As in the past, this training will be a regularrequirement for all employees. In 2022 ourcommunication plan on compliance included
several initiatives to continue raising awarenesson business ethics among our people, like ourannual Ethics and Compliance Week that wasrolled out across our business units. We have also
an established anti-bribery due diligence process
for third parties who have contact with publicauthorities on behalf of our Company.

For further information please see the AntiBribery Policy and Code of Business Conduct on
our website: https://www.coca-colahellenic.com/
en/about-us/corporate-governance/policies. We
have established grievance mechanisms, including
an independently operated whistleblower ‘Speak
Up! line’, available in all Coca-Cola HBC countries
in local languages to ensure any concerns can beraised. In 2022, we investigated 589 allegations(2021: 344) of which 324 (2021: 210) werereceived through the ‘Speak Up Hotline’. All
allegations involving potential Code of BusinessConduct violations were investigated inaccordance with the Group Code of BusinessConduct Handling Guidelines. Of thoseinvestigated, 219 (2021: 105) matters were
substantiated as code violations of which 20(2021: 15) involved an employee in a managerial
position or involved a loss greater than €10,000.
For details concerning the handling of allegations
received in 2022, see our website.
You can find more on allegations investigated andviolations uncovered in our GRI index: https://www.coca-colahellenic.com/content/dam/cch/
us/documents/oar-2022/2022-GRI-ContentIndex.pdf. Through the ‘Speak Up! line’ we receive,
retain, investigate and act on employee
complaints or concerns regarding accounting,internal control or ethical matters. This includes
any matters regarding the circumvention or
attempted circumvention of internal controls,
including matters that would constitute a violationof our Code of Business Conduct or matters
involving fraudulent behaviour by officers or
employees of the Group. All such allegations,complaints or concerns may be communicated ina variety of ways, in local languages and on an
anonymous basis, to our Head of Corporate Audit.

Communications received by the Head ofCorporate Audit, or directly through the ‘Speak
Up! line’, are kept confidential and, where
requested, anonymous. The Head of Corporate
Audit liaises regularly with the General Counseland communicates all significant allegations to the
Chair of the Audit and Risk Committee.
All matters received via the ‘Speak Up Hotline’ or
any other reporting mechanism are thoroughly
investigated. The Audit and Risk Committee
receives summary reports of escalated incidents
and instances of whistleblowing together with thestatus of investigations and, where appropriate,
management actions to remedy issues identified.
The Committee reports to the Board on suchmatters, which reviews and considers thosereports at least bi-annually as appropriate.
Disclosure Committee
A Disclosure Committee has been established,
and disclosure controls and procedures have been
adopted to ensure the accuracy andcompleteness of our public disclosures. The
Disclosure Committee is composed of the Group
Chief Financial Officer, the General Counsel, theDirector of Investor Relations and the Group
Financial Controller.

Performance reporting
Reports on our annual performance andprospects are presented in the Annual Reportfollowing recommendation by the Audit and Risk
Committee. In line with UK practice, we haveadopted half-year and full-year reports, and Q1and Q3 trading updates. Internally, our financial
results and key performance indicators arereviewed by the Executive Leadership Team on amonthly basis. This information includes
comparisons against business plans, forecasts
and prior-year performance. The Board of
Directors receives updates on performance ateach Board meeting, as well as a monthly reporton our business and financial performance.

123

124

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

Ensuring business
continuity and growth
Letter from the Chair of the Nomination Committee
Highlights this year
• Succession planning and talent review• Sales and Supply Chain capability-building
academy• Women and leadership

Priorities for 2023
• continuous work on succession plans for
Board and senior management positions;• close monitoring of the Group’s talentand development frameworks in order toensure the continued strength of thecurrent talent pipeline;• engagement surveys• externally facilitated Board andcommittee assessments; and• follow up actions on outcome of 2022
evaluation assessment.

Dear Stakeholder
The work of the Nomination Committee
has continued to focus on thecomposition of the Board and theimportant task of Board and senior
management succession planning.
In 2022, the Committee continued to review thebalance of skills, experience and diversity of theBoard and focused on the talent development,
employee engagement and gender diversity
initiatives necessary to ensure that the Group
has the people and skills to deliver on its strategy.
The Committee also considers the overall lengthof service of the Board as a whole as part of its
succession planning and keeps under review theneed to refresh Board membership. In addition,
the Committee oversaw an externally facilitatedself-assessment process.
A summary of the Group’s Nomination Policy forthe recruitment of Board members is available
online at: https://www.coca-colahellenic.com/
content/dam/cch/us/documents/about-us/
corporate-governance/summary-of-nominationpolicy-for-recruitment-of-board-members.pdf.
downloadasset.pdf. The Board Diversity Policy
is described on page 125.

Reto Francioni
Committee Chair

Role and responsibilities
The function of the Nomination Committee is toestablish and maintain a process for appointing
new Board members, to manage, in consultation
with the Chairman, the succession of the Chief
Executive Officer and to support the Board in
fulfilling its duty to conduct a Board selfassessment. The formal role of the Nomination
Committee is set out in the charter for thecommittees of the Board of Directors in Annex Cof the Company’s Organisational Regulations.
This is available online at https://www.cocacolahellenic.com/en/about-us/corporategovernance.
Key elements of the Nomination Committee’srole are:• reviewing the size and composition of the Board;• identifying candidates and nominating newmembers to the Board;• planning and managing, in consultation with the
Chairman, a Board membership succession plan;• ensuring, together with the Chairman, theoperation of a satisfactory induction
programme for new members of the Board anda satisfactory ongoing training and education
programme for existing members of the Boardand its committees as necessary to deliver on
our strategy;• setting the criteria for, and overseeing, theannual assessment of the performance andeffectiveness of each member of the Board andeach Board committee;• conducting an annual assessment of theperformance and effectiveness of the Board,and reporting conclusions andrecommendations based on the assessment
to the Board; and• overseeing the employee and management
talent development and succession plansof the Group.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

Members

Membership status

Reto Francioni(Chair)Charlotte J. Boyle
Anna
Diamantopoulou

Member since 2016
Chair since 2016
Member since 2017
Member since 2020

The members of the Nomination Committee
are Reto Francioni, Charlotte Boyle and Anna
Diamantopoulou. All members of the Nomination
Committee are independent non-Executive
Directors. At the Annual General Meeting in June
2022, Reto Francioni, Charlotte Boyle and Anna
Diamantopoulou were re-elected for a one-year
term by the shareholders.
The Chair of the Nomination Committee attended
our AGM in June 2022 and regularly interacts withrepresentatives of our shareholders.

Work and activities
The Nomination Committee met four times
during 2022 and discharged the responsibilities
defined under Annex C of the Company’s
Organisational Regulations. The Chief Executive
Officer and the Chief People and Culture Officer
regularly attend meetings of the Nomination
Committee. In addition, the Chairman is actively
involved in the work of the Nomination Committee
concerning succession planning and the selectionof key people. In 2022, the General Counsel
also met with the Nomination Committee on
several occasions. During 2022, the work of theNomination Committee included consideration of:• succession planning and development of plans
for the recruitment of new Board members
and senior management and certain membersof the Group’s Executive Leadership Team;• composition of the Board, including theappropriate balance of skills, knowledge,
experience and diversity;• review of the talent management framework;• the performance evaluation and annual
assessments of the committees and the Board;• follow up actions arising from Board andcommittee evaluations;• review of the Director induction process andtraining programmes; and• review of the Group’s D&I Policy.

Performance evaluation of the Board
The Nomination Committee led the annual
assessment of the performance of the Board andits committees during the year with the support of
Lintstock, an external advisory firm. The key areas
included in the assessment were Board structureand diversity, timeliness and quality of information,
Board discussions, and effective contributionsof each Director, the performance of the Board,committees, succession planning, risk appetite
and risk management, and remuneration andperformance. The scores were high overall, andthe results of the evaluation were presented at
the December 2022 Board meeting. Further details
on the internal Board evaluation are set out
on page 95.
As with all employees, the Group offers training
opportunities to the Board and senior management
in order to improve their skills, and encourages all
Board members and senior management to gain
relevant experience and knowledge to fulfil theirposition’s duties.

Diversity
The Group continues to have a firm commitment
to policies promoting diversity, equal opportunity
and talent development at every level throughout
the organisation, including at Board andmanagement level, and is constantly seeking to
attract and recruit highly qualified candidates for
all positions in its business. The Group’s D&I Policy
applies to all people who work for us. Further details
on the Group’s D&I Policy are set out on page 41
in the Strategic Report.

The Group believes that diversity at the Board levelacts as a key driver of Board effectiveness, helps
to ensure that the Group can achieve its overallbusiness goals especially in light of our geographicalfootprint, and is critical in promoting a diverse andinclusive culture across the whole Group. The Board
has adopted a formal Board Diversity Policy, which
guides the Nomination Committee and the Board
in relation to their approach to diversity in respectof succession planning and the selection process
for the appointment of new Board members.
The Nomination Committee is responsible for
implementing this policy and for monitoring
progress towards the achievement of its objectives.
The requirements and objectives of the Board
Diversity Policy, include that the Nomination
Committee is required to take into account all
aspects of diversity, including age, ethnicity,
gender, educational and professional backgroundand social background when considering
succession planning and new Board appointments;
seek a wide pool of candidates, with a broad rangeof previous experience, skills and knowledge; andgive preference to executive search firms that are
accredited under the Enhanced Code of Conduct
for Executive Search Firms. Board appointments
are evaluated on merit against objective criteriawith due regard for diversity to ensure thatcandidates contribute to the balance of skills,
experience, knowledge and diversity of the Board.
The Board also considers the overall length ofservice of the Board as a whole when considering
refreshment of the membership.
The Board understands the benefits of diversityof gender, ethnicity, knowledge and experience,and this is reflected in the Board Diversity Policy.
The objectives of the Board Diversity Policy
include ensuring female representation on the
Board and as such both the Board and Nomination
Committee are mindful of the target set for FTSE

350 companies by the FTSE Women Leaders
Review (minimum of 40% of women on the Board
and Leadership teams; and at least one woman
in the Chair or Senior Independent Director roleon the Board and/or one woman in the Chief
Executive or Finance Director role by 2025) as wellas the reporting requirements of the UK Listing
Rules. The Board currently has 30% female
representation and also meets the target set by
the Parker Review having had a person of colouron the Board since 2015. The Board will prioritise
improving the Board gender balance and theNomination Committee has, and will continue to,consider this in the context of its continuous
work on succession plans for the Board, as well as
senior management. The Executive Leadership
Team has 23% female representation while 39.5%
of our senior leaders are women. Figures showing
Board and senior management gender diversity
are shown on page 105. The Board is committed
to appointing the best people with the right skill set,
regardless of gender, ethnicity, religion or disability,
and as such does not think it is appropriate to set
specific targets for Board appointments.
The Board recognises the importance of diversity
in its business. It is the Board’s responsibility tooversee senior management succession planning
for a diverse pipeline of managers and talent
identified from the management talent development
programme. This links to our strategy to develop
our people and ensure we attract and retain adiverse talent pool, and is one of the five pillarsof our growth strategy. Further information on
pages 38-42. The Nomination Committee, in
conjunction with the Executive Leadership Team,will continue to monitor the proportion of womenat all levels of the Group and ensure that all
appointments are made with a view to having
a high level of diversity within the workplace andin leadership positions.

Committee at work
Succession
planning

Board
composition

Recruitment

Shortlisting

Interview

Balance of skills
assessment

Appointment

Induction

125

126

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued

Overseeing the journey to net zero
Letter from the Chair of the Social Responsibility Committee
Activity highlights 2022
• close oversight of the ‘Earn our licence tooperate, pillar as part of our Growth Story
2025 including progress of public Mission
2025 commitments• review of the actions, initiatives, andprogress versus the roadmap of
NetZeroby40, the Company’s commitment
to reaching net zero greenhouse gas
emissions by 2040, combined with sciencebased carbon reduction targets by 2030
• endorsement of the first Group biodiversity
commitment – to achieve a net positive
impact on biodiversity in critical areas in our
direct operations and supply chain by 2040
and eliminate deforestation in our supply
chain by 2030, and adoption of the updated
Biodiversity Statement• endorsement of the food loss and foodwaste internal goal
• deep review of sustainable packaging
progress, including status of in-house
recycled PET (rPET) production, move of
portfolio in three countries to 100% rPET,
approach to packageless and refillables, andpackaging collection models• endorsement of humanitarian support to
Ukraine and related volunteering activities• deep-dive analysis of Group results invarious environmental, social and corporate
governance (ESG) benchmarks• update of the Climate Change Policy andenvironmental policy• monitor innovation projects andpartnerships that support our ESG agenda• ongoing updates on plastic packaging levies
and product tax developments• active involvement in Annual Stakeholder
Forum

Priorities for 2023
• progress public Mission 2025 commitmentswith a focus on NetZeroby40, biodiversity andpackaging initiatives• outcomes from the implementation of thefirst two steps of the Science-Based Targets
for Network (SBTN) methodology, namely
biodiversity mapping of the value chain,
identification of the nature hotspots andquantifying their impacts• partnerships for innovation in the area of ESG,
both with customers and startups• implementation of 2023 roadmap related to2030 science-based carbon reduction targets• continue our social impact programmes withparticular focus on supporting employees andcommunities in Ukraine• plans for calorie reduction and added sugar
reduction across beverage categories• stakeholder outreach activities• reviewing and streamlining Company
disclosure and reporting standards based on
EU Taxonomy, Corporate Social Responsibility
Directive (CSRD), European Sustainability
Reporting Standards (ESRS) and standards
issued by the International Sustainability
Standards Board (ISSB)• ongoing activities related to ESG
benchmarking activities, plastic packaging
levies and product tax developments

Dear Stakeholder,
In light of the tragic events in Ukraine,
the company has focused its efforts on
supporting our employees and the wider
community. The Company has provided
humanitarian support to those affected,
in collaboration with the Coca-Cola
System and NGOs and through massive
efforts of employee volunteering.
The Social Responsibility Committee
has endorsed the team to take related
actions and has regularly monitored
the implementation of these actions.
In 2022, the Social Responsibility Committee
continued its focus on the implementation of theMission 2025 sustainability commitments and theoverall integration of sustainability in the businessstrategy, with a core focus on Net Zero performance
including a roadmap for in-house rPET production
and progress against the recently introduced
Global Reuse pledge of The Coca-Cola Company.
The Committee reviewed the progress acrosssustainable packaging areas – the proposedsolutions of returnable glass bottles andpackageless beverages, exploration of reusable
vessels for dispensed solutions, the pilots forFreestyle Compact® machines and reusablebottle returning services. Special attention has
been paid to the results of the first Sustainability
Challenge with startups, where potential future
partnerships will be considered for sustainable
packaging and collection.
The Committee has monitored regulatorychanges in the domain of sustainability, including
the EU Green Deal, the updated EU Packaging
and Packaging Waste Directive with its new reusetargets, and all other developments related tothe circular economy, deposit return systems,
evolved nutrition labelling, instruments to
reduce energy consumption and price caps,
and sustainability reporting.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Corporate governance report continued
We are very proud that during 2022 the Company
achieved its highest ever score of 94 (out of 100)at the S&P Global Corporate Sustainability
Assessment (a base for the DJSI membership), an
improvement of seven percentage points
compared to 2021. Coca-Cola HBC has beenamong the top-rated companies globally in the
S&P Corporate Sustainability Assessment (DJSI)
for over 12 years. The Company continues to haveleading scores in MSCI ESG rating, ISS ESG, V.E.,
FTSE4Good, and received an A- (Leadership) in its
CDP Climate and Water submissions.
During the year we reviewed the approach to stepup our customer partnerships in sustainability thatwill accelerate our sustainability agenda and drive
value at scale, and also we reviewed our integrated
capabilities plan, aimed to equip our frontliners andoverall organisation with sustainability knowledge
in a tailored, engaging and simple way.
Going forward in 2023, the Committee will ensurethat the business strategy is fully aligned with theCompany’s ESG agenda and that the Company
continues to create value for employees,
communities, society and the environment.
Biodiversity, the EU Taxonomy, the requirementsof the Corporate Sustainability Reporting Directive(CSRD), initiatives to support the Company’s
Packaging Mix of the Future journey, human rights,
our social agenda and impact, customer
partnerships in sustainability as well as the full ESG
integration of the Egyptian operations, will be
among the focus areas in 2023.

Anastasios I. Leventis
Committee Chair

Role and responsibilities
The Social Responsibility Committee is
responsible for the development and supervisionof procedures and systems to ensure the pursuitof the Company’s social and environmental goals,
as set out in the charter for the committees of theBoard of Directors Annex C to the Company’s
Organisational Regulations.
Key areas of responsibility are:• establishing the principles governing theGroup’s policies on social responsibility and theenvironment to guide management’s decisions
and actions;• overseeing the development and supervisionof procedures and systems to ensure theachievement of the Group’s social responsibility
and environmental goals;• establishing and operating a council responsiblefor developing and implementing policies andstrategies to achieve the Company’s social
responsibility and environmental goals (in all
ESG pillars, such as climate change, water
stewardship, packaging and waste, sustainablesourcing, health and nutrition, and our people
and communities), and ensuring Group-wide
capabilities to execute such policies andstrategies;• ensuring the necessary and appropriate
transparency and openness in the Group’sbusiness conduct in pursuit of its social
responsibility and environmental goals;• ensuring and overseeing the Group’s
interactions with stakeholders in relation to its
social responsibility and environmental policies,
goals and achievements, including the level ofcompliance with internationally accepted
standards; and• reviewing Group policies on environmental
issues, human rights, and other topics as they
relate to social responsibility.

Members

Membership status

Anastasios I.
Leventis (Chair)
Anna
Diamantopoulou
Bruno Pietracci

Member since 2016
Chair since 2016
Member since June 2020
Member since June 2021

Work and activities
The Social Responsibility Committee met four times
during 2022. Along with Committee members,
those meetings were attended by other membersof the Board, namely Charlotte J. Boyle and Ryan
Rudolph, the CEO, the Chief Corporate Affairs &Sustainability Officer, and additional senior leaders
subject to the discussion topics.
During 2022, the Social Responsibility Committee
reviewed and provided guidance and insights toadvance the Group’s sustainability approach in thefollowing areas:• progress and the action plans made against the
17 publicly communicated 2025 sustainability
commitments and their six focus areas;• biodiversity net positive goal-setting and joined
Corporate Engagement Programme of the
Science Based Target Network (SBTN);• sustainable packaging cross-functional teamagenda and progress towards more sustainable
packaging (rPET, packageless, refillables, andother), and packaging collection and recovery;• detailed plans and initiatives for delivery ofscience-based carbon reduction targets and
NetZeroby40 commitment;• innovative opportunities related to greenhydrogen, rPET in-house production, potential
enzymatic recycling of packaging etc.;• low-sugar and zero-sugar products andreformulations as part of the Group’scommitment to reduce calories, and addedsugar reduction and nutrition strategy;• supporting activities for our employees andcommunities in Ukraine;• volunteering activities across our BUs;

• diversity, equity, and inclusion topics;• employee assistance programme;• social impact community programmes suchas #YouthEmpowered programmes andcurriculum, Water Stewardship projects, andYouth Sport Games;• materiality assessment process and resultsof the annual materiality survey;• Egyptian operations sustainability plans andreporting;• review of stakeholder engagement plan and thefeedback from the Annual Stakeholder Forum;and• ESG reporting frameworks and benchmarks
such as GRI Universal Standards, UN SDGs,
Dow Jones Sustainability Indices, CDP Climate& Water, Task Force on Climate-related
Financial Disclosures (TCFD), and theSustainability Accounting Standards Board(SASB).

127

128

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report

Maintaining our performance focus
during a challenging year
Highlights this year

Our People• Higher merit increases than originally budgeted in order to mitigate inflation trends• Two pay increases across the board during the year with a special focus on frontline workers• One-off additional energy bonus to non‑managerial employees• Financial education and well-being support sessions• Enhanced flexible working

Our Company• Business performance surpassed expectations• Acquisitions to support future growth• Rated the world’s most sustainable beverage company in the Dow Jones Sustainability Index
for the 6th time
• In May 2022, received the top “AAA” rating from MSCI ESG for the eighth year in a row. MSCI ESG
rates companies across the world based on their exposure to industry-specific ESG risks and theirability to manage those risks relative to peers.

Our Community• Contributions and support provided to employees and to the humanitarian effort in Ukraine• Via our #YouthEmpowered sessions, we increased employability of young people• Invested approximately €7.4 million in local community initiatives• €100k Sustainability Challenge- a startup challenge designed to identify the most innovative
packaging and packaging recovery technologies in the consumer packaged goods space.

Our Shareholders• Dividends of €0.78 per share proposed, an increase of 9.9% versus previous year
• Proposed dividend will represent a pay-out ratio of 46%, within our target pay-out ratio of 40%
to 50% of comparable EPS• Delivered strong financial performance in 2022, with organic revenue up 14.2% and reported
revenue up 28.3%

Our Customers & Suppliers• Remained the number one contributor, to revenue growth within fast moving consumer goods
across our retail customers• Spent circa €5 billion with local suppliers and contractors• Increased the frequency of our customer engagement, providing customers with the best support

Our Environment• Investing behind our Mission 2025 sustainability commitments and our goal to achieve net zero
emissions across our value chain by 2040
• Invested €45 million to date in-house rPET facilities• Issued our first green bond for €500 million in 2022, to be allocated towards eligible green projects
that accelerate towards our sustainability goals

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued

Letter from the Chairof the Remuneration
Committee

Dear Shareholder,2022 was a year in which we continued
to make clear progress in our vision to
be The Leading 24/7 Beverage Partner.
We delivered excellent results reflecting
the strength of our business, our culture,and our team spirit despite the challengesof the war. Our Growth Story 2025
priorities continued to drive performancein 2022. The strength of our portfolio
and capabilities ensures we continue to
win in our markets. Our continued focus
on our customers at the heart of what
we do has led to us remaining the number
one contributor to revenue growthwithin fast moving consumer goods
across our retail customers in 2022.
We have navigated through record highinflation while delivering strong financial
performance: record levels of comparable
EBIT, excellent ROIC and a strong
balance sheet.

We have seized opportunities such as investments
in Egypt, in digital commerce and data capabilities
and accelerated the sustainability agenda with our
first green bond and the opening of another rPet
facility. Throughout 2022 our people have remained
our priority, especially as we faced the unimaginable
consequences of war.
The Remuneration Committee’s decisions during
the year were considered in the context of the
remuneration of all our employees and reflect theimportance of incentivising and rewarding thosemost critical employees on the front lines serving
our customers.
As the Chair of the Remuneration Committee,
I am pleased to present our Directors’ Remuneration
Report for the year ended 31 December 2022.
Our primary listing is on the London Stock Exchange,and our Company is domiciled in Switzerland.
We therefore ensure, that we comply with UK
regulations, except where these conflict with
Swiss law. The format of this year’s Remuneration
Report is consistent with the format of last year’s
as there were no significant changes in relevant
regulations. As always, I welcome your feedback
and suggestions regarding anything we can do
to improve the report.

Free cash flow (€m)

645.1
(2021: 601.3)

Comparable EBIT (€m)

929.7
(2021: 831.0)

NSR (Net sales revenue) (€m)

9,198.4(2021: 7,168.4)

Comparable EPS (€)

1.706(2021: 1.584)

ROIC

14.1%
(2021: 14.8%)

The Group’s remuneration philosophy andpolicies are designed to attract, motivate andretain the talented people we need to meet theCompany’s strategic objectives, and to give themdue recognition.
To this end, the Remuneration Committee has
worked to ensure that the remuneration policy
remains fair, transparent, and competitivein comparison with our peers, and that
remuneration helps drive our growth strategy
and sustainable performance.

Included in MIP

Included in PSP

129

130

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Remuneration in context
As shown in our full year results, successful
execution of our Growth Story 2025 strategy
delivered strong performance, with organic
revenue excluding Russia and Ukraine up 22.7%.
We implemented price increases and mix initiatives
across our markets, expanding revenue percase and mitigating inflation. These results wereachieved alongside continued market share gains,
and we remain the number one contributor torevenue growth within fast moving consumer
goods across our retail customers.
The overall business has remained resilient despite
the impact of COVID-19 and the Russia-Ukraine
war and this is testament to the leadership andcommitment of the management team and allof our talented people. We have made the rightdecisions with investments in our core strategic
capabilities, digital commerce, data insights andanalytics, route-to- market and revenue growth
management, with effective execution and focus
on categories and channels where we can drive
the best growth.
We continue to invest in opportunities that position
us well for the future, with the goal of delivering
sustainable growth and creating shareholder value.
This includes making progress on our environmental
goals, now furthered with the issuance of our firstever green bond in 2022.
Our key financial highlights include:• Organic revenue up 14.2% and reported
revenue up 28.3%. Excluding Russia andUkraine, organic revenue up 22.7%;• Organic volume growth was 8.1% excluding
Russia and Ukraine;• Organic revenue per case up 15.9%, benefitingfrom pricing and targeted actions to improve
mix throughout the year;• Comparable EBIT up 11.9% to €929.7 million
with organic EBIT up 1.3% as pricing, mix andcost discipline drove profits despite thechallenging inflationary backdrop;• Another year delivering record free cash flow
and an increased dividend with:– Comparable EPS up 7.7%,– Free cash flow increased by €43.8 million
to €645.1 million, due to improved profit
generation and effective working capitalmanagement– Proposed ordinary dividend of €0.78 pershare, up 9.9% year on year and representing
a 46% pay-out.
Our financial results reflect our success in creating
value for all of our stakeholders-from our customers
to the communities where we operate. Despite
logistical challenges posed by the pandemic andthe Russia-Ukraine war, we continued to provide
extraordinary service to our customers, as
demonstrated by our net promoter score which
increased 5 percentage points in 2022 comparedwith the prior year.
We also continued to deliver on our ambitious
environmental objectives, continuing to reduce
emissions from our direct operations and making
further progress on packaging:• Cumulatively, our absolute score 1 and 2
emissions have been reduced by 21% in 2022
vs. our baseline year of 2017.
• We made new commitments to achieve a net
positive impact on biodiversity in critical areasin our operations and supply chain by 2040
and eliminate deforestation in our supply
chain by 2030.
• As part of a pack/price architecture adjustment,
we launched our entire Swiss product portfolio
in recycled PET (rPET) packaging, and are
moving forward with additional rPET launches
in additional markets in 2023.

To navigate the limited supply of rPET, weinvested in a new rPET facility in Italy and areworking with stakeholders in a number of markets
to launch well-designed, industry-led, deposit
return or collection schemes.
To combat youth unemployment in our markets
and address inequalities in education, we continued
to develop and expand our #YouthEmpowered
programme. By the end of 2022, we had reached
790,000 young people since the programme’s
inception in 2017.
Participants benefit from in-person and online
training as well as networking and mentoring
sessions alongside Coca-Cola HBC senior
managers. While many aspects of the programme
moved online during the pandemic, thecommitment of our people remained steadfast.

Stakeholder experience
Our shareholders
The Committee acknowledges that although,at our 2022 Annual General Meeting (AGM) all
resolutions were successfully passed with therequisite majority, there were neverthelesssignificant minority votes against Resolutions
7 and 9, the advisory votes to approve the UK
Remuneration Report and the Swiss Remuneration
Report. Each was passed with the support of
67.2% of the votes cast.
Following the AGM, we extended our engagementwith shareholders and their proxy advisers on
remuneration issues. We reached out to the top
majority and minority shareholders as well as all
those who had contacted the Board to express
their views, particularly with regard to theadjustment of targets for the 2019 Performance
Share Plan awards. I was pleased to have theopportunity to meet shareholders and hear theirviews on actions the Committee might consider

to provide retention and incentivisation to theworkforce. I would like to thank them for taking thetime to meet with me and provide their feedback
both on the approach to Executive Director
remuneration as well as the important topic
of our approach to the wider workforce.
In terms of the shareholder experience, ourinvestors have benefited from recent andhistorical strong financial performance. We havereturned €4.5 billion to shareholders since 2001
with a progressive dividend policy complemented
by extraordinary returns through special dividends.
In 2022, we paid the 2021 dividend of €0.71 pershare, an 11% increase. This represented a payout
ratio of 45%, in line with our target of 40-50%, andwas proposed to ensure we rewarded
shareholders and maintained our commitment toa progressive dividend. While there is continued
geopolitical turmoil and macroeconomic
uncertainty, based on our business’s resilienceand future opportunities, the Board has proposeda dividend of €0.78 per share for 2022, a 9.9%
increase compared with last year. We havecommitted to continue to make progressive
dividend payments in the future.

Our employees and their remuneration
Our absolute focus during 2022 was to keep our
people safe during the turbulent geopoliticalevents that ensued during the year as well as
continuing initiatives to support the workforce,building on feedback from our regular employee
surveys. A clear indicator of our success is thatengagement levels continued to remain high at
85%. We listen closely to our people and act on
their feedback, simplifying processes andinvesting in the capabilities necessary to achieve
our Growth Story 2025 strategy. We continued
our efforts to build an inclusive workplace and adiverse workforce to reflect our customer baseand communities.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Our strategy starts from retention, complemented
by external hiring to create a gender-balanced
organisation and we’ve committed to have atleast 50% of manager positions held by womenby 2025. The entire Executive Leadership
Team volunteered to sponsor participants of our
Women in Leadership programmes, which involvesponsors helping participants navigate common
career barriers.
I continue to attend the majority of the Works
Council meetings and plenary during theyear, which covers approximately half of ouremployee population. I speak with the employee
representatives to discuss their thoughts on the
Company’s relationship with them. The discussions
and outcomes are shared in the Remuneration
Committee meetings as input for taking wider
decisions related to remuneration for the workforce
and executives. Much of the discussions in 2022
focused around the rising cost of living andemployee work-life balance. As a Committee, wewere alert to these concerns, and ensured we were
kept informed regarding the Company-driven
initiatives to address them.
Our remuneration structure was designed toapply to all our employees, not just the Executive
Director, which is a material factor in defining
and shaping the policy and implementation of thepolicy. With inflationary pressure high in 2022, ourintention was to protect our frontline workers who
were most impacted.
In reviewing our wider workforce remuneration
practices and to reward performance andrecognise the challenging circumstances facedby our employees, we provided salary increases
across the majority of our markets above
the original plan. We did this by providing
disproportionately higher increases to ourbusiness developers and line operators and byproviding a second pay increase during the year
in the majority of our markets to the frontline.

In addition to these increases, we paid a special
one-off bonus to assist our non-managerial
population (approximately 30,000 employees)
across the Group to manage the rising energy
costs, with an exceptional higher one-off payment
for our employees in Ukraine.
Full details of how we cultivated the potentialof our people in 2022 can be found on pages 38-42.

Incentive outcomes
The formulaic MIP (management incentive plan)
outcome for the CEO was 77.5% of the maximum
opportunity, with both the performance targets
and actual performance determined excluding
Russia and Ukraine given the ongoing war.
The Committee agreed it was appropriate toremove the impact of Russia and Ukraine both in
the targets and performance of the business given
the announcement by The Coca-Cola Company
to suspend its business operations in Russia.
The outcome reflects record levels of revenue,comparable EBIT and free cash flow, which the2022 MIP was based on, against a challenging
backdrop when set.
When determining performance, the Committee
took into account the strong results and business
context highlighted above, including; the handlingof the challenges posed by the Russia-Ukraine
war, including the humanitarian support provided to
Ukraine, overall exceptional business performance,
the successful acquisition of Egypt, engagementof our employees and overall progress towards
our sustainability goals.Taking this performancein the round, the Committee determined that thisoutcome is a fair reflection of wider performance,
50% of the MIP pay-out will be deferred into sharesfor three years, ensuring further shareholderalignment. Details of the targets, performanceagainst them and the plan outcomes are set out
on pages 148-149.

Performance against the stretching EPS and ROIC
targets over the period 2020 to 2022 resulted in aformulaic vesting level of 48% of the maximum PSP(performance share plan) award granted in 2020,
As noted earlier in my letter, the complex natureof the Group’s operations, and the impact ofexternal events, has meant that the Committee
felt it appropriate to exercise discretion in the past
to adjust the level of vesting under the
performance share plan to ensure the targets
remained relevant and appropriately stretching
and that the overall outcome was reflective of theunderlying performance of the Group.
The Committee considered whether an exercise
of positive discretion would be appropriate forawards made to the CEO in relation to theperformance period ending in 2022, and raised
this with shareholders before making any final
decisions. Whilst the Committee felt that such an
exercise of discretion might be appropriate toensure that the overall level of pay-out wasreflective of the business performance, reflecting
on feedback received from shareholders, theCommittee has decided not to exercise positive
discretion in relation to the PSP awards for the CEO.
The Committee also assessed whether there had
been any perceived ‘windfall gains’ for this award
as part of the wider performance in the roundassessment. As part of this, the Committee notedthat recent PSP awards have been made at varying
share prices and this has resulted in a level ofvariation in the number of shares granted (in somecases more shares are granted and other cases
fewer shares are granted). The Committee also
factored in share price performance and notedthat the share price has not followed a typical
V-shape or U-shape recovery that other companies
have experienced, with our share price performance
impacted by a series of external events over the
past three years, including but not limited to
COVID-19 and the Ukraine-Russia war.

In addition to share price performance between
grant and the end of the performance period(equivalent to CAGR of 9.5%), the Committee
reflected on the trend in long-term performancefrom the management team over the course of
the performance period, and given the consistentdelivery of exceptional business performance overthe performance period, including:• Organic revenue growth of 14.2%;• Comparable EPS growth of 7.7%;• Cumulative free cash flow of €645.1 million,
with 2022 representing another year of record
free cash flow;• All in the context of delivering on our ambitious
environment objectives, with absolute CO2
emissions down by 6%
the Committee did not consider the share priceincrease to be excessive, but commensurate with
underlying business performance. As such, theCommittee determined not to apply an adjustment
to the level of vesting.

Looking ahead
The Remuneration Committee will continue tokeep policies under review so as to ensure thatplans and programmes relating to remuneration
support the Company’s strategy and objectives
and are closely linked to shareholders’ interests.
We will continue to review the wider workforce
remuneration arrangements with a special focus
on our frontline and specifically our businessdevelopers’ salaries and incentives. We will lookto the remuneration strategy for our talents
and big bet capabilities and continue our journeyin diversity, equity, and inclusion (DEI) by ensuringbalance in our pay equity practices and flexible
work arrangements.
The Committee is mindful of the evolution incorporate governance requirements and willcontinue to review the application of these as
it relates to aspects of remuneration.

131

132

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Whilst the Remuneration Committee believes that
the Remuneration Policy approved by shareholders
at the AGM in June 2022 remains appropriate andcarefully balances alignment with the Company’sbusiness strategy and our response to evolving
corporate governance requirements, theCommittee intends to keep the Remuneration
Policy under review to ensure that it remains fit
for purpose both in driving business performance
being an appropriate motivation and retention tool
for the senior management team over the coming
year. We welcome feedback and are committed
to continuing engagement with shareholders on
this important topic during the year.
In light of the current macro-economic environment,
2023 salary increase levels for employees have
not yet been finalized. It is anticipated that theChief Executive Officer’s increase will not behigher than the increases provided for the wider
workforce. The increase will be effective 1 May
2023 and will be communicated in the following
Directors’ remuneration report.
As in 2022, for the purposes of the 2023 MIP
business performance will be measured based on
performance against three KPIs: revenue (40%weighting), comparable EBIT (40% weighting) andfree cash flow (20% weighting). There will be nochange to the maximum MIP opportunity for 2023.
To achieve our growth ambitions and to deliver
continued financial performance that creates thedesired returns, the Committee believes strongly
that we must continue to retain and incentivise
the management team in a fair manner.
In particular, we considered the performance of
the CEO over the last year, his performance since
his appointment as CEO in 2017 and his pivotal
role in leading the company to achieve our 2025
Growth Story Commitments. Key achievementsfor our CEO between 2017 and 2022 include:• Net Sales Revenue (NSR) growth of 28.3%(YoY), with NSR having grown by over 40% since
his appointment• Comparable EPS growth of 7.7% in 2022, withcomparable EPS having grown by c.40% since
his appointment• Record free cash flow in 2022 of €645.1m(+7.3% YoY), with free cash flow having grownby over 50% since his appointment• Dividend pay-out in 2022 of 46% (+9.9% YoY
on dividend per share), with an average of
c.46% dividend pay-out since his appointment(excluding the extraordinary dividend in 2019).
The total dividend paid to shareholders since
his appointment amounts to approx. €2.1bn.
To recognise the CEO’s exceptional efforts,
leadership, commitment and continued deliveryof strong business performance, in spite of thechallenging external environment, the Committee
felt it was appropriate to review the overall
remuneration opportunity for the CEO for 2023.
The Committee considered a number of options
available to it within the remuneration policy
agreed with shareholders. It concluded that anincrease in the PSP award in 2023 was the optimal
solution in part for its simplicity but importantly
as it creates direct shareholder alignment. The
awards will be delivered in shares and only wherestretch long-term performance against EPS,
ROIC and reduction in CO2 emissions targets aredelivered. These targets are aligned to the deliveryof our 2025 Growth Story Commitments. Meetingthese commitments will require, amongst otherthings, an acceleration in the Group’s businessperformance in our largest markets, a rebalancingof the business priorities of the Group following
the war between Russia and Ukraine, and anincreased focus on the successful integration of
Egypt within the Group as well as growing market
share opportunities in the region.

In line with our existing Remuneration Policy andin order to appropriately incentivise the CEO tocontinue the exceptional performance of thebusiness and address the challenges the businesswill need to address in the medium term, theRemuneration Committee is proposing a PSP
award of 450% of base salary for 2023 which will
be subject to stretching long-term performancetargets. The proposed award level is within therange allowable under the PSP in our Directors’
Remuneration Policy, as approved by shareholders.
Whilst market positioning is not a primary reference
point, even once the increased award level isfactored in, the overall remuneration opportunity
for the CEO will be positioned around median vs
the FTSE 100.
The targets for the 2023 award, have been set
at very stretching levels commensurate withthe award opportunity, taking into account ourlong-term business plan (guided by the 2025
Growth Story Commitments), market practicein listed peers, and external expectations of
performance (adjusted to remove the impact
of Russia and Ukraine, over the next three years,
which is in line with what we did with the 2022 award).
Comparable EPS (EUR)
ROIC
Reduction in CO2emissions (kilotonnes)

ThresholdMaximum

1.40
11.0%

1.63
12.9%

4,037

3,851

A maximum Comparable EPS (excluding Russia
and Ukraine) of 1.63EUR in 2025 represents
significant growth of c.39% on 2022 (adjusted to
exclude Russia and Ukraine so that the base year ison a comparable basis to year end measurement).
The ROIC targets have been set to reflect the drivein earnings growth whilst reflecting the planned
capital investments over the period, including theEgypt acquisition and its integration; and asubstantial reduction in CO2 emissions to 3,851
kilotonnes is required for a maximum pay-out.

The role of the Remuneration
Committee
The main responsibilities of the Remuneration
Committee are to establish the remuneration
strategy for the Group and to approve
compensation packages for Directors and senior
management. Further, the Committee reviews
wider workforce remuneration policies at
Coca-Cola HBC and the alignment of incentives
and rewards with strategy and culture, taking
these into account when setting the remuneration
policy. The Remuneration Committee operates
under the Charter for the Committees of theBoard of the Company set forth in Annex C to
the Organisational Regulations of the Company,
available on the Group’s website at:https://www.coca-colahellenic.com/en/about-us/
corporate-governance.
Members

Membership status

Charlotte J. Boyle(Chair)Reto Francioni
Anna
Diamantopoulou

Member since 2017
Chair since June 2020
Appointed June 2016
Appointed June 2020

In accordance with the UK Corporate Governance
Code, the Remuneration Committee consistsof three independent non- Executive Directors:
Charlotte J. Boyle (Chair), Reto Francioni andAnna Diamantopoulou, who were each lastelected by the shareholders for a one-year termon 22 June 2022.
The Remuneration Committee met four times in2022; in March, June, September and December.
Please refer to the Corporate Governance Reporton page 105 for details of the Remuneration
Committee meetings.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued

Q&A
Chair of the Remuneration
Committee

safeguards to ensure the revised targets led tooutcomes which were fair for all employees andconsidered the broader stakeholder environment.
We understand that some of our shareholders did
not support this adjustment as was evident in thevote at the Annual General Meeting. With thebusiness performing at levels exceeding those of
the pre-pandemic period, the Remuneration
Committee took this decision to ensure thetargets were still fair, meaningful and achievable.
The Committee applied the same treatment
to the 2019 PSP for all employees, with nopreference given to any population. As set out
in my letter, following the AGM, we met withshareholders and proxy advisers to discuss theirconcerns on the decisions made in relation to
2019. Reflecting on the feedback received, theCommittee agreed that whilst the underlying
performance of the Group in a challenging
environment may support an exercise of discretionin relation to the 2020 PSP, this would not beappropriate for the CEO.

Q: Did the Committee make any
adjustments to the CEO’s incentive
outcomes for 2022?
Q: What was the reason behind thesignificant minority vote against the
remuneration report last year andwhat has the Committee done toaddress any issues?
A: We adjusted the PSP targets that impacted
the vesting of the 2019-2021 plan as thesetargets were set prior to the onset of COVID.
In order to ensure the PSP continued to beeffective in its core purpose – to motivate andretain employees (including executives) overa long period – the Committee decided toadjust the targets to maintain relevancy.
In doing so, the Committee put in place

A: No, we have not made any adjustments to theCEO’s incentive outcomes in respect of 2022.
Further context is provided in the Remuneration
Committee Chair’s letter.

Q: How does the Committee engage
with the workforce?
A: In my role as designated director for theworkforce I attend the European Works Council(EWC) meetings which gives me the opportunity
to interact and discuss the issues raised by
employees. I also take the opportunity to meetwith employees during the year outside of theboard calendar. At the most recent EWC the
topics discussed concerned work-life balance
and inflation. The well-being of employees is a

key priority of the Company, evidenced by thewell-being framework for all employees, thesupport provided to employees and their families in
Ukraine and special sessions focusing on work-lifebalance, stress, burnout and financial well-being.
To support the employees with their inflationary
concerns, there was an additional pay increaseduring the year and a one-time energy bonus to
all non-managerial employees.

Q: Why did the Committee decide toaward an increased PSP grant in 2023
to the CEO?
A: This increased PSP grant takes into accountour growth ambitions over the next three-year
period and the performance of the Company
and CEO since appointment. Further detail on
the rationale and the targets is set out in the
Remuneration Committee Chair’s letter.

Q: Is the Committee satisfied withthe use of ESG metrics in its executive
incentives?
A: The Company has used ESG metrics for either
short-term or long-term incentives for a numberof years, reflecting our approach to responsible,
long-term management and the importance ofensuring our licence to operate. The CEO’s
individual performance is measured in key
strategic areas, including ESG benchmarks, andthese are taken into account for the MIP.
In 2022, the Company received the highest scoresin 8 of the 10 most recognised ESG benchmarks,
including DJSI, MSCI ESG, V.E., ISS ESG, and
FTSE4GOOD. The PSP contains metrics linked toa reduction in CO2 emissions.
The CO2 emissions target in the PSP implicitly
captures reduction in plastics, which was a key
driver of its selection as a metric.

These selected metrics directly align with andincentivise delivery of the Company’s ESG
objectives, particularly our ambitious goal toachieve net zero emissions across our entire
value chain by 2040.
The achievement of ESG metrics has an impact
on the overall MIP opportunity and account for
15% of the PSP opportunity. The Committee issatisfied that this is sufficient focus in order toachieve our ambitious sustainability targets,without diluting focus on financial andgrowth objectives.

Charlotte J. Boyle
Chair of the Remuneration Committee

133

134

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Remuneration throughout the organisation – a snapshot
Attracting

Retaining

Finding the people we want
and need

Continuing to attract the best talent

Recognising

Motivating

Adopting behaviours that produce
exceptional performance

Achieving business, financial
and non‑financial targets

Reward strategy and objective
The objective of the Group’s remuneration philosophy is to attract, retain and motivate employees whoare curious, agile and committed to high performance. Our reward strategy seeks to promote a growthmindset and reinforce desirable behaviours, ensuring that employees are fairly rewarded and that theirindividual contributions are linked to the success of the Company.
Variable pay is an important element of our reward philosophy. A significant proportion of total
remuneration for top managers (including the Chief Executive Officer and the members of the
Executive Leadership Team) is tied to the achievement of our business objectives. These objectives
are defined by key business metrics that are consistent with our growth strategy and will deliver
long-term shareholder value. The variable pay element increases or decreases based on the achieved
business performance.

Clarity
Remuneration arrangements
should be transparent andpromote effective
engagement withshareholders and workforce.

We believe that our policy provides transparency for Executives
and shareholders about what performance we are looking for across
our portfolio.

Simplicity
Remuneration structures
should avoid complexity andtheir rationale and operation
should be easy tounderstand.

Our remuneration arrangements for executive directors are
purposefully simple, comprising fixed pay (salary, benefits, pension),a short-term incentive plan (Management Incentive Plan) and along-term incentive plan (Performance Share Plan).

Risk
Remuneration arrangements
should ensure reputationaland other risks fromexcessive rewards, andbehavioural risks that canarise from target-based
incentive plans, are identified
and mitigated.

The Remuneration Policy includes a number of points to mitigate
potential risks:

Predictability
The range of possible valuesof rewards to individual
directors and any other limits
or discretions should be
identified and explained at
the time of approving policy.

We aim for our disclosure to be clear to allow shareholders tounderstand the range of potential values which may be earned under
the remuneration arrangements. Our Remuneration Policy clearly setsout relevant limits and potential for discretion.

Through equity-related long-term compensation, we seek to ensure that the financial interests of the
Chief Executive Officer, the members of the Executive Leadership Team and senior managers arealigned with those of shareholders.
All of our remuneration plans, both fixed and variable, are designed to be cost-effective, taking into
account market practice, business performance, and individual performance and experience where
relevant. We pay close attention to our shareholders’ views in reviewing our remuneration policy
and programmes.
In line with the UK Corporate Governance Code, the following factors, which align well with our
objectives, were also considered:

The Remuneration Committee has aimed to incorporate simplicity andtransparency into the design and delivery of our Remuneration Policy.
We aim for disclosure of the policy and how it is implemented to be ina clear and succinct format.

The remuneration structure is simple to understand for bothparticipants and shareholders and is aligned to the strategic prioritiesof the business.

• There are defined limits on the maximum opportunity levels underincentive plans.
• Performance targets are calibrated appropriately, ensuring they areadequately stretching but sustainable.
• The Remuneration Committee considers formulaic incentive
outcomes and determines whether to make any adjustments,
including to take into account the experience of wider stakeholders
such as employees and shareholders.
• Incentive plans include provisions to allow malus and clawback to be
applied, where appropriate. The use of deferral, holding periods,
in-employment and post-employment shareholding requirements
ensures that there is an alignment of interests between the
Chief Executive and shareholders and encourages sustainable
performance.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued

Proportionality
The link between individualawards, delivery of strategy
and long-term performanceof the company should beclear. Outcomes should not
reward poor performance.

We believe that the link between individual awards, the delivery ofstrategy and the long-term performance of the Company is clearly
explained in this report and that our approach ensures proportionate
pay outcomes that do not reward poor performance. A significant partof the CEO’s reward is linked to performance with a clear line of sight
between business performance and the delivery of shareholder value.
The Remuneration Committee may adjust formulaic outcomes of
incentive arrangements if they do not appropriately align withperformance achieved or the experience of wider stakeholders such as
employees and shareholders.

Alignment to culture
Incentive schemes should
drive behaviours consistent
with company purpose,values and strategy.

We want our Executives to make decisions that support the long-term
performance and health of the business. The incentive arrangements
and the performance measures used are strongly aligned to those thatthe Board considers when determining the success of theimplementation of the Company’s purpose, values and strategy.

How we implement our reward strategy
The chart below illustrates how we put our reward strategy into practice, with the different remuneration arrangements that apply to different employee groups.
We regularly review our reward strategy to ensure it remains relevant and effective in meeting the needs of our employees, especially our frontline workers. During 2022 we provided higher increases to ourbusiness developers and line operators in comparison to other employees. In addition, in the majority of our markets we provided increases twice during the year to our frontline workers.
Chief Executive Officer andExecutive Leadership Team

Chief Executive Officer,
Executive Leadership Team andselected senior management

Selected middle andsenior management

All management

All employees

Shareholding guidelines
Support the alignment withshareholder interests ensuring
sustainable performance: Chief
Executive Officer – required to holdshares in the Company equal in value
to 300% of annual base salary within afive-year period and a postemployment shareholding
requirement applying from this year.

Performance Share Plan
Performance share awards vest overthree years. PSP awards are cascaded
down to select senior managers,
promoting a focus on long-term
performance and aligning them toshareholders’ interests,

Long-Term Incentive Plan
Cash long-term incentive awards vest
over three years. LTIP awards arecascaded down to select middle andsenior management to reinforce
long-term performance and ensure
retention of our talents.

Management Incentive Plan
Management employees may be
eligible to receive an award under theannual bonus scheme that promotesa high-performance culture.
Performance conditions are bespoke
to each role and business unit.

Employee Share Purchase Plan
(dependent on country practice)
The Employee Share Purchase Planencourages share ownership andaligns the interests of our employeeswith those of shareholders.

Executive Leadership Team – required
to hold shares in the Company equal invalue to 100% of annual base salary
within a five-year period.
Note: Participants in the Performance Share Plan are not eligible to participate in the Long-Term Incentive Plan.

Fixed pay and benefits (base salary,
retirement and other benefits –dependent on country practice)Base salaries may reflect the market
value of each role as well as theindividual’s performance and potential.
Retirement and other benefits are
subject to local market practice.

135

136

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Remuneration arrangements for the Chief Executive Officer – at a glance
Retirement
benefits

Base salary

Other benefits

ESPP

MIP

Fixed pay

The table below summarises the remuneration arrangements in place for our Chief Executive Officer.
See page 148 for total compensation figures.
Pay element

DetailBase salary

The base salary of the Chief Executive Officer is €840,000.

MIP(Management
Incentive Plan)

ESPP(Employee Share
Purchase Plan)

Other benefits include (but are not limited to) medical insurance, housing
allowance, company car/allowance, cost of living adjustment, trip allowance,
partner allowance, exchange rate protection, tax equalisation and tax filingsupport and advice. Benefit levels vary each year depending on need.
The Chief Executive Officer may participate in the Company’s Employee
Share Purchase Plan.
As a scheme participant, the Chief Executive Officer has the opportunity
to invest a portion of his base salary and/or MIP payments in shares.
The Company matches employee contributions on a one-to-one basis
up to 3% of base salary and/or MIP payout.
Awards are subject to potential application of malus and clawback provisions.

The MIP consists of a maximum annual bonus opportunity of up to 140%of base salary.
Payout is based on business performance targets and individual
performance. The business performance element will result in an outcome
between 0% and 200% of the target MIP and the individual performanceelement will result in an outcome of up to 100%, with the overall payout as apercentage of salary being based on the multiplication of these two figures.
For 2023, business performance will be measured based on performanceagainst three KPIs: revenue (40% weighting), comparable EBIT (40%weighting) and free cash flow (20% weighting).

Retirement benefits The Chief Executive Officer participates in a defined benefit pension planunder Swiss law. Employer contributions are 15% of annual base salary.

Other benefits

Totalcompensation

Variable pay subject to performance

2023 salary increase levels for employees have not been finalized
at the date of this report. It is anticipated that the Chief Executive.
Officer’s increase will not be higher than the increases provided forthe wider workforce and will be effective from 1 May 2023.

Normal retirement age for the Chief Executive Officer’s plan is 65 years.
In case of early retirement, which is possible from the age of 58, the Chief
Executive Officer is entitled to receive the amount accrued under the plan
as a lump sum.

PSP

50% of any MIP payout will be deferred into shares for a further three-year
period. Payments are subject to potential application of malus andclawback provisions.
PSP(Performance
Share Plan)

The PSP is an annual share award which vests after three years. For theaward in 2023, vesting will be based on performance conditions measured
over a three-year period against:(i) comparable earnings per share (EPS) (42.5% weighting);(ii) return on invested capital (ROIC) (42.5% weighting);(iii) reduction of CO2 emissions (15% weighting).
An additional two-year holding period will apply following vesting.
Awards are subject to potential application of malus and clawback provisions.
As explained in the Chair letter, in 2023 it is intended to make a one-off
award (within shareholder-approved Policy limits) of 450% of salary.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Remuneration policy
Introduction
The following section (pages 137-140) sets out our Directors’ remuneration policy as approvedby shareholders at the Annual General Meeting in June 2022. No changes are being proposed to thepolicy this year and the 2022 policy will continue to apply.

Policy table – Chief Executive Officer
The Company currently has a single Executive Director, being the Chief Executive Officer.
Therefore, for simplicity, this section refers only to the Chief Executive Officer. This remuneration policy
would, however, apply for any new Executive Director role, in the event that one was created during theterm of this remuneration policy. In that case, references in this section to the Chief Executive Officer
should be read as being to each Executive Director.

As a Swiss-incorporated company, we are not required to put forward our remuneration policy fora shareholder vote, but we intend to do so voluntarily at least every three years (or when there arechanges). We continue to endeavour to make sure that our disclosure complies with UK regulations,
except where these conflict with Swiss law.

FixedBase salary

Retirement benefits

Purpose and link to strategy
To provide a fixed level of compensation appropriate to the requirements of the role of Chief Executive
Officer and to support the attraction and retention of the talent able to deliver the Group’s strategy.

Purpose and link to strategy
To provide competitive, cost-effective post-retirement benefits.

Operation
Salary is reviewed annually, with salary changes normally effective on 1 May each year.
The following parameters are considered when reviewing the base salary level:• the Chief Executive Officer’s performance, skills and responsibilities;• economic conditions and performance trends;• experience of the Chief Executive Officer;• pay increases for other employees; and• external comparisons based on factors such as: the industry of the business, revenue,
market capitalisation, headcount, geographical footprint, stock exchange listing (FTSE)
and other European companies.
Malus and clawback provisions do not apply to base salary.
Maximum opportunity
Whilst there is no maximum salary level, any increases awarded to the Chief Executive Officer
will normally be broadly aligned with the broader employee population.
The salary increase made to the Chief Executive Officer may exceed the average salary increase
under certain circumstances at the Remuneration Committee’s discretion. These circumstances
may include: business and individual performance; material changes to the business; internal
promotions; accrual of experience; changes to the role; or other material factors.
Performance metrics
Individual and business performance are key factors when determining any base salary changes.
The annual base salary for the Chief Executive Officer is set out on page 136.

Operation
The Chief Executive Officer participates in a defined benefit pension plan. However, we have adjusted
the pension scheme to be co-contributory, in line with the pension scheme for the wider Swiss
workforce, for new Executive Directors’ appointments from 2020 onwards.
Normal retirement age for the Chief Executive Officer’s plan is 65 years. In case of early retirement,
which is possible from the age of 58, the Chief Executive Officer is entitled to receive the amountaccrued under the plan as a lump sum.
Malus and clawback provisions do not apply to retirement benefits.
Maximum opportunity
The contributions to the pension plan are calculated as a percentage of annual base salary(excluding any incentive payments or other allowance/benefits provided) based on age brackets
as defined by Federal Swiss legislation.
This percentage is currently 15% of base salary and increases to 18% above age 55.
Performance metrics
None.

137

138

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued

Fixed continued
Other benefits

ESPP (Employee Share Purchase Plan)

Purpose and link to strategy
To provide benefits to the Chief Executive Officer which are consistent with market practice.

Purpose and link to strategy
The ESPP is an Employee Share Purchase Plan, encouraging broader share ownership, and is intended
to align the interests of employees including the Chief Executive Officer with those of the shareholders.

Operation
Benefit provisions are reviewed by the Remuneration Committee which has the discretion
to recommend the introduction of additional benefits where appropriate.
Typical provisions for the Chief Executive Officer include benefits related to relocation such as
housing allowance, company car/ allowance, cost of living adjustment, trip allowance, partner
allowance, exchange rate protection, tax equalisation and tax filing support and advice. For all benefits,
the Company will bear any income tax and social security contributions arising from such payments.
Malus and clawback provisions do not apply to benefits.

Operation
This is a voluntary share purchase scheme across many of the Group’s countries. The Chief Executive
Officer as a scheme participant has the opportunity to invest from 1% to 15% of his base salary and/or MIP payout to purchase the Company’s shares by contributing to the plan on a monthly basis.
The Company matches the Chief Executive Officer’s contributions on a one-to-one basis up to
3% of the employee’s base salary and/or MIP payout. Matching contributions are used to purchaseshares one year after the purchase of shares by employees. Matching shares are immediately vested.

Maximum opportunity
There is no defined maximum as the cost to the Company of providing such benefits will vary fromyear to year.

Dividends received in respect of shares held under the ESPP are used to purchase additional shares
and are immediately vested. The Chief Executive Officer is eligible to participate in the ESPP operated
by the Company on the same basis as other employees.

Performance metrics
None.

Malus and clawback provisions apply. Further details may be found in the Additional notes to the
Executive Director’s remuneration policy table section on page 141.
Maximum opportunity
Maximum investment is 15% of gross base salary and MIP payout. The Company matches
contributions up to 3% of gross base salary and MIP payout. Matching contributions are used topurchase shares one year after the matching. Matching shares are immediately vested.
Performance metrics
The value is directly linked to the share price performance.
It is therefore not affected by other performance criteria.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued

Variable pay
MIP (Management Incentive Plan)

PSP (Performance Share Plan)

Purpose and link to strategy
To support profitable growth and reward annually for contribution to business performance. The plan
aims to promote a high-performance culture with stretching business and individual targets linked to
our key strategies.

Purpose and link to strategy
To align the Chief Executive Officer’s interests with the interests of shareholders, and increase
the ability of the Group to attract and reward individuals with exceptional skills.

Operation
Annual cash bonus awarded under the MIP is subject to business and individual performance metrics
and is non-pensionable.

Operation
The Chief Executive Officer is granted conditional awards of shares which vest after three years,
subject to the achievement of performance metrics and continued service. Grants take place
annually, normally every March.

The Chief Executive Officer’s individual objectives are regularly reviewed to ensure relevance tobusiness strategy and are set and approved annually by the Chair of the Remuneration Committee
and Chairman of the Board of Directors.

Performance metrics and the associated targets are reviewed and determined around the beginningof each performance period to ensure that they support the long-term strategy and objectivesof the Group and are aligned with shareholders’ interests.

Stretching targets for business performance are set annually, based on the business plan of theGroup as approved by the Board of Directors. The Remuneration Committee will determine thebusiness performance metrics and weightings on an annual basis.

Dividends may be paid on vested shares where the performance metrics are achieved at the endof the three-year period.

Performance against these targets and bonus outcomes is assessed by the Remuneration
Committee, which may recommend an adjustment to the payout level where it considers the overall
performance of the Company or the individual’s contribution warrants a higher or lower outcome.
Malus and clawback provisions apply. Further details may be found in the Additional notes to the
Executive Director’s remuneration policy table section on page 141.
Maximum opportunity
The Chief Executive Officer’s maximum MIP opportunity is set at 140% of annual base salary.
The business performance element will result in an outcome between 0% and 200% of the target
MIP and the individual performance element will result in an outcome of up to 100%, with the overall
payout as a percentage of salary being based on the multiplication of these two figures.
Threshold, target and maximum achievement for the Business Performance element will result inan outcome as follows:• Threshold: 0% of base salary• Target: 70% of base salary• Maximum: 140% of base salary• The maximum opportunity level will therefore only pay out for both a stretch level of businessperformance and full achievement of the individual performance element.

Malus and clawback provisions apply. Further details may be found in the Additional notes
to the Executive Director’s remuneration policy table section on page 141.
Maximum opportunity
Awards (normally) have a face value up to 330% of base salary.
In exceptional circumstances only, the Remuneration Committee has the discretion to grant awards
up to 450% of base salary.

139

140

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued

Variable pay continued
MIP (Management Incentive Plan)

PSP (Performance Share Plan)

Performance metrics
The MIP awards are based on business metrics linked to our business strategy. These may include,
but are not limited to, measures of revenue, profit, profit margins and operating efficiencies.
The weighting of individual performance metrics shall be determined by the Remuneration
Committee around the beginning of the MIP performance period.

Performance metrics
Vesting of awards is subject to the three-year Group performance metrics. For each award, theRemuneration Committee will determine the applicable metrics, weightings and target calibration
making up the performance condition.

Details related to the key performance indicators can be found in the Annual Report on
Remuneration on page 148.
Deferral of MIP
50% of any MIP award is to be deferred into shares which will be made available after a three-year
deferral period which commences on the first day of the fiscal year in which the deferred shareaward is made.
Deferred shares may be subject to malus and clawback (for a period of two years following this incentive
award) to the extent deemed appropriate by the Remuneration Committee, in line with best practice.

Following the end of the three-year period, the Remuneration Committee will determine the extent
to which performance metrics have been met and, in turn, the level of vesting. Participants may
receive vested awards in the form of shares or a cash equivalent.
For each performance metric, achieving threshold performance results in vesting of 25% of theaward and maximum performance results in vesting of 100% of the award. There will be a straightline vesting between these performance levels.
Performance share awards will lapse if the Remuneration Committee determines that theperformance metrics have not been met. The Remuneration Committee will have discretion
to reduce or negate PSP award vesting, in the case of significant adverse environmental, social
or governance impacts regarding the Company’s activities.
Holding period
Any vested award (net of shares sold to cover tax liability) is subject to a further two-year holding
period following the end of the three-year performance period. During this two-year period, thesebeneficially owned shares are subject to a no-sale commitment. Any shares subject to the holding
period count towards the shareholding requirement.
Adjustments
In the event of an equity restructuring, the Remuneration Committee may make an equitableadjustment to the terms of the performance share award by adjusting the number and kind of shares
which have been granted or may be granted and/or making provision for payment of cash in respectof any outstanding performance share award.
Where exceptional circumstances exist such that the original targets no longer meet the intent at thetime of grant, the Committee will have the discretion to adjust targets in a manner that is considered
to be no less stretching than the original performance condition. Where any such adjustment ismade, the details will be fully disclosed in the following Remuneration Report.
Change of control
In the event of change of control, unvested performance share awards held by participants vest
immediately on a pro-rated basis if the Remuneration Committee determines that the performance
metrics have been satisfied or would have been likely to be satisfied at the end of the performance
period, unless the Remuneration Committee determines that substitute performance share awards
may be used in place of the previous awards. For vested shares subject to the additional holding period,
the holding period will lapse and the participants are no longer subject to the no-sale commitment.

Corporate
Governance

Strategic
ReportFinancial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Additional notes to the Executive Director’s remuneration policy table
Chief Executive Officer’s remuneration policy illustration
The graph below provides estimates of the potential reward opportunity for the Chief Executive
Officer and the split between the different elements of remuneration under three different
performance scenarios: ‘Minimum’, ‘Target’ and ‘Maximum’. In line with the reporting regulations,a scenario assuming 50% share price growth over the three-year PSP performance period is also
shown below. The assumptions used for these charts are set out in the table below (€ 000s).
Maximum
performance +50%
share price growth
Maximum2%
10% 6%
2%
13% 8%

14%

Target3%
19% 12% 14%

Minimum

9%58% 33% 1,452

Minimum performance

MIP

PSP

Fixed remuneration only, i.e. base salary, pension and other benefits(including ESPP participation).

Target performance

No payout under the MIP or PSP.
Fixed remuneration.
MIP payout of 70% of base salary.

Maximum performance

Component

Minimum (€ 000s)

Target (€ 000s)

Maximum
performance+ 50% share price
Maximum (€ 000s) growth (€ 000s)

Base salary1
PensionCash and non-cash benefits2
MIP
PSP
PSP – 50% share priceappreciation

€840
€126
€486
–
–

€840
€126
€503
€588
€2,268

€840
€126
€521
€1,176€3,780

€840
€126
€521
€1,176€3,780–€1,452–€4,325–€6,443€1,890€8,333

1. Represents the annual base salary as at the last review in May 2022.
2. ESPP employer contributions may vary depending on the MIP payout provided that the Chief Executive Officer decides to contributea portion of the MIP towards the ESPP. The figures provided have been calculated on the basis of the applicable MIP payout and theChief Executive Officer deciding to contribute 3% to the ESPP.

52% 4,325

PensionVariable

Total

59% 6,443

Base salary
Cash and non-cash beneﬁts
PSP – share price appreciation

Fixed

23% 8,333

45%

18%

Other than in the ‘Maximum performance + 50% share price growth’ scenario, no share price growthor dividend assumptions have been included in the charts above.

PSP vesting at 270% of base salary.
Fixed remuneration.
MIP payout of 140% of base salary.

PSP vesting at 450% of base salary.
Maximum performance Fixed remuneration.
+ 50% share price growth
MIP payout of 140% of base salary.
PSP vesting at 450% of base salary.
50% assumed share price growth over three-year PSP performance period.

141

142

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
ESOP (Employee Stock Option Plan)The ESOP was replaced by the PSP in 2015 and the last grant under the ESOP took place in December
2014. Although the Remuneration Committee does not intend to award under the ESOP going forward,
there are still outstanding stock option awards which may be exercised in future years. Awards vest
in one-third increments each year for three years and can be exercised for up to 10 years from thedate of the award.

Malus and clawback provision for variable pay plans
The MIP, PSP, ESOP and ESPP plans include malus provisions which give the Remuneration Committee
and/or the Board discretion to judge that an award should lapse wholly or partly in event of a material
misstatement of financial results and/or misconduct, significant reputational risk and corporate failure.
The Remuneration Committee and/or Board also has the discretion to determine that clawback should
be applied to awards under the MIP, PSP, ESOP and ESPP plans for the Chief Executive Officer andmembers of the Executive Leadership Team. Clawback can potentially be applied to payments or vested
awards for up to a two-year period following payment or vesting.

Shareholding guidelines
In order to strengthen the link with shareholders’ interests, the Chief Executive Officer is required tohold shares in the Company equal in value to 300% of annual base salary. Members of the Executive
Leadership Team are required to hold 100% of annual base salary. The Chief Executive Officer has five
years from appointment to accumulate shares equal to 300% of annual base salary (with shares acquired
from PSP awards and shares resulting from the deferral of the 50% of the MIP counting towards
fulfilment of the shareholding requirement). The Committee continues to review the potential need forstronger shareholding requirements in the long term and this is subject to further review in the future.
The Policy contains a post-employment shareholding requirement whereby the Chief Executive Officer
would, if leaving the Company, be required to hold shares equivalent to 200% of base salary (or actual
shareholding at termination date if lower than this) for a period of two years after leaving employment.

Remuneration arrangements across the GroupThe remuneration approach for the Chief Executive Officer, the members of the Executive Leadership
Team and senior management is similar. The Chief Executive Officer’s total remuneration has asignificantly higher proportion of variable pay in comparison with the rest of our employees. The Chief
Executive Officer’s remuneration will increase or decrease in line with business performance, aligning itwith shareholders’ interests.
The structure of the remuneration package for the wider employee population takes into account local
market practice and is intended to attract and retain the right talent, be competitive and remunerate
employees for promoting a growth mindset while contributing to the Group’s performance. As part of
the Performance for Growth framework introduced in 2019, we revised and updated the remuneration
framework with features such as each business unit having more flexibility on target positioning,
managers having the flexibility to retain key talent, and guidance provided for increased awards forhigh-potential and/or exceptional performance.

Policy table – non-Executive Directors
Base fees
Purpose and link to strategy
To provide a fixed level of compensation appropriate to the requirements of the role of non-Executive
Director and to attract and retain high-quality non-Executive Directors with the right talent, values andskills necessary to provide oversight and support to management to grow the business, support theCompany’s strategic framework and maximise shareholder value.
Operation
Non-Executive Directors’ fees are set at a level that will not call into question the objectivity of theBoard. When considering market levels, comparable companies typically include those in the FTSE index
with similar positioning as the Company, other Swiss companies with similar market capitalisation and/or revenues, and other relevant European listed companies.
Maximum opportunity
Fee levels for non-Executive Directors include an annual fixed fee plus additional fees for membershipof Board committees when applicable, as summarised below for the period from the AGM June 2022 to
AGM May 2023:• Base Chairman’s fee: €150,000• Base non-Executive Director’s fee: €82,000• Senior Independent Director’s fee: €18,000• Audit and Risk Committee Chair fee: €32,000• Audit and Risk Committee member fee: €16,000• Remuneration, Nomination and Social Responsibility Committee Chair fees: €13,000• Remuneration, Nomination and Social Responsibility Committee member fees: €6,500
Fee levels are subject to periodic review and approval by the Chairman of the Board and the Chief
Executive Officer.
Other benefits
Non-Executive Directors do not receive any benefits in cash or in kind. They are not entitled toseverance payments in the event of termination of their appointment. They are entitled toreimbursement of all reasonable expenses incurred in the interests of the Group.
Variable remuneration
Non-Executive Directors do not receive any form of variable compensation.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Legacy arrangements

Non‑Executive Directors

For the avoidance of doubt, it is noted that the Company will honour any commitments entered intothat have previously been disclosed to shareholders.

It is expected that non-Executive Directors appointed during the remuneration policy period will receive
the same basic fee and, as appropriate, committee fee or fees as existing non-Executive Directors
and will be entitled to reimbursement of all reasonable expenses incurred in the interests of the Group.

Policy on recruitment/appointment

It is expected that non-Executive Directors appointed during the remuneration policy period will be
appointed on a one-year term of appointment, in the same manner as existing non-Executive Directors.

Executive Directors
Annual base salary arrangements for the appointment of an Executive Director will be set considering
market relevance, skills, experience, internal comparisons and cost. The Remuneration Committee
may recommend an appropriate initial annual base salary below relevant market levels. In suchsituations, the Remuneration Committee may make a recommendation to realign the level of basesalary in the following years. As highlighted above, annual base salary ‘gaps’ may result in higher rates
of salary increase in the short term, subject to an individual’s performance. The discretion is retained
to offer an annual base salary necessary to meet the individual circumstances of the recruited Executive
Director and to enable the hiring of an individual with the necessary skills and expertise.
The maximum level of variable pay that may be offered will follow the rules of the MIP and is capped at140% of the relevant individual’s annual base salary. The maximum level of equity-related pay that may
be offered will follow the PSP rules and is capped at 450% of the relevant individual’s annual base salary.
The typical award is not expected to surpass 330% of base salary. Different performance measures
may be set initially for the annual bonus taking into consideration the point in the financial year that a
new Executive Director joins. The above limits do not include the value of any buyout arrangements.
Benefits will be provided in line with the Group’s policy for other employees. If an Executive Director
is required to relocate, benefits may be provided as per the Group’s international transfer policy which
may include transfer allowance, tax equalisation, tax advice and support, and housing, cost of living,
schooling, travel and relocation costs.
The Remuneration Committee may consider recommending the buying out of incentive awards thatan individual would forfeit by accepting the appointment up to an equivalent value in shares or in cash.
In the case of a share award, the Remuneration Committee may approve a grant of shares under
the PSP. When deciding on a potential incentive award buyout and in particular the level and value
thereof, the Remuneration Committee will be informed of the time and performance pro-rated levelof any forfeited award.
It is expected that Executive Directors appointed during the remuneration policy period will be
appointed on similar notice provisions to the Chief Executive Officer, allowing for termination of officeby either party on six months’ notice.

The Company does not compensate new non-Executive Directors for any forfeited share awards
in previous employment.

Termination payments
The Swiss corporate rules regarding the Compensations in Listed Companies limits the authority of
the Remuneration Committee and the Board to determine compensation. Limitations include theprohibition of certain types of severance compensation.
Our governance framework ensures that the Group uses the right channels to support reward
decisions. In the case of early termination, the non-Executive Directors would be entitled to their fees
accrued as of the date of termination, but are not entitled to any additional compensation. The Chief
Executive Officer’s employment contract does not contain any provisions for payments on termination.
Notice periods are set for up to six months and non-compete clauses are 12 months. The notice period
anticipates that up to six months’ paid garden leave may be provided. Similarly, up to 12 months of basesalary may be paid out in relation to the non-compete period.
In case of future terminations, payments will be made in accordance with the termination policy
on page 144.

143

144

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued

Pay element

Good leaver(retirement at 55 or later/at least 10 years’continued service)Good leaver(injury, disability)

Bad leaver(resignation, dismissal)

Death in service

Base salary and otherbenefits / non-Executive
Directors’ fees
ESPP

Payment in lieu of notice is not permissible. The Company could ask the Chief Executive Officer to be on paid garden leave for up to six months.

MIP

A pro-rated payout as of the date ofretirement will be applied.

Unvested cash allocations held in the ESPP will vest upon termination.

Deferred shares will continue to vest
as normal.
PSP/ESOP

All unvested options and performance
share awards continue to vest as normal
subject to time pro-rating and are subject
to the additional holding period.
For vested shares that are subject to theadditional holding period, they will continue
to be subject to the no-sale commitment
until the end of the relevant two-year period.
Under Swiss law, share awards are
considered annual compensation and assuch when time pro-rating is required, theyear of grant (12 months) and not thevesting period (36 months) for time
pro-rating calculations is considered.

Unvested cash allocations under the ESPP
are forfeited.
A pro-rated payout as of the date of leaving In the event of resignation or dismissal, as
will be applied.
per Swiss law the Chief Executive Officer
is entitled to a pro-rated MIP payout.
Deferred shares will continue to vest
as normal.
Any outstanding deferred shares will lapse.
All unvested options and performance
share awards immediately vest to theextent that the Remuneration Committee
determines that the performance
conditions have been met, or are likely to be
met at the end of the three-year
performance period, and are subject to theadditional holding period.

Deferred shares will continue to vest
as normal.
All unvested options and performance
All unvested options and performance
share awards immediately lapse without any share awards immediately vest subject totime and performance pro-rating.
compensation.
In the event of resignation, all vested
options must be exercised within six
months from the date of termination.

Upon dismissal, all vested options must
be exercised within 30 days from the date
Any options that vest are exercisable within of termination.
12 months from the date of termination.
For vested shares that are subject to the
For vested shares that are subject to theadditional holding period, they will continue
additional holding period, they will continue to be subject to the no-sale commitment
to be subject to the no-sale commitment
until the end of the relevant two-year period.
until the end of the relevant two-year period.

Corporate events
In the event of an equity restructuring, the Remuneration Committee may make an equitableadjustment to the terms of the performance share award by adjusting the number and kind of sharesthat have been granted or may be granted and/or making provision for payment of cash in respectof any outstanding performance share award.

Available ESPP shares will be transferredto heirs.
A pro-rated payout will be applied and will be
paid immediately to heirs, based on thelatest rolling estimate.

Any options that vest are exercisable within
12 months from the date of termination.
For vested shares that are subject to theadditional holding period, the no-salecommitment will cease immediately.
Under Swiss law, share awards are
considered annual compensation.
When time pro-rating is required, the yearof grant (12 months) and not the vesting
period (36 months) is considered for time
pro-rating calculations.

In the event of a change of control, unvested performance share awards held by participants vest
immediately on a pro-rated basis if the Remuneration Committee determines that the performance
conditions have been satisfied or would have been likely to be satisfied at the end of the performance
period, unless the Remuneration Committee determines that substitute performance share awards
may be used in place of the previous awards.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Service contracts

Consideration of employee views

Zoran Bogdanovic, the Chief Executive Officer, has a service contract with the Company with a sixmonth notice period. As noted in the Termination payments section on page 143, the Chief Executive
Officer’s employment contract does not include any termination benefits, other than as mandated by
Swiss law. The Swiss Code of Obligations requires employers to pay severance when an employment
relationship ends with an employee of at least 50 years of age after 20 years or more of service.

The remuneration structure has been designed to apply to all Group employees, not just the Executive
Directors, which is a material factor in defining and shaping the policy and implementation of the policy.
The Remuneration Committee does not currently consult specifically with employees on policy forthe remuneration of the Chief Executive Officer. Pay movement for the wider employment group is
considered when making pay decisions for the Chief Executive Officer. The Chair of the Remuneration
Committee is also the designated non-Executive Director for workforce engagement. As such, she
attends meetings of our European Works Council and meets with elected employee representatives
from our businesses in EU countries. She then reports back to the Board on her observations andmatters raised by employees, ensuring Board and Remuneration Committee deliberations anddecision-making are fully informed. Our engagement levels continue to remain high at 85%.

The Chief Executive Officer is also entitled to reimbursement of all reasonable expenses incurredin the interests of the Company.
In accordance with the Swiss Ordinance against Excessive Compensation in Listed Companies, there
are no sign-on policies/provisions for the appointment of the Chief Executive Officer.
The table below provides details of the current service contracts and terms of appointment for the
Chief Executive Officer and other Directors.

Name

Title

Anastassis G. David

Chairman andnon‑Executive Director
Chief Executive Officer

Zoran Bogdanovic

Charlotte J. Boyle
Henrique Braun
Olusola (Sola) David-Borha
Anna Diamantopoulou
William W. (Bill) Douglas III
Reto Francioni
Anastasios I. Leventis
Christo Leventis
Alexandra Papalexopoulou
Bruno Pietracci
Ryan Rudolph

Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Senior Independent
non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director

Unexpired termof service contract
or appointment
as non-Executive
Director

Date originallyappointed to
the Board of
the Company

Date appointed
to the Board of
the Company

27 July 2006

21 June 2022 One year

11 June 2018 21 June 2022 Indefinite,terminable
on six months’
notice20 June 2017 21 June 2022 One year
22 June 2021 21 June 2022 One year
24 June 2015 21 June 2022 One year
16 June 2020 21 June 2022 One year
21 June 2016 21 June 2022 One year
21 June 2016 21 June 2022 One year
25 June 2014
25 June 201424 June 2015
22 June 2021
21 June 2016

21 June 2022
21 June 2022
21 June 2022
21 June 2022
21 June 2022

One year
One year
One year
One year
One year

The Chief Executive Officer’s service contract and the terms and conditions of appointment of the
non-Executive Directors are available for inspection by the public at the registered office of the Group.

Consideration of shareholder views
Shareholder views and the achievement of the Group’s overall business strategies have been taken
into account in formulating the remuneration policy. Following shareholder feedback before and after
the Annual General Meeting, the Remuneration Committee and the Board consult with shareholders
and meet with institutional investors to gather feedback on the Company’s remuneration strategy
and corporate governance. The Company would be happy to engage with shareholders in the future
to discuss the outcomes of the remuneration policy.
In reviewing and determining remuneration, the Remuneration Committee takes into account the following:• the business strategies and needs of the Company;• the views of shareholders on Group policies and programmes of remuneration;• the alignment of remuneration policy with the principles of clarity, simplicity, risk, predictability,
proportionality and alignment with culture;• market comparisons and the positioning of the Group’s remuneration relative to othercomparable companies;• input from employees regarding our remuneration programmes;• the need for similar, performance-related principles for the determination of executive remunerationand the remuneration of other employees; and• the need for objectivity. Board members, the Chief Executive Officer and Executive Leadership
Team members play no part in determining their own remuneration. The Chair of the Remuneration
Committee and the Chief Executive Officer are not present when the Remuneration Committee
and the Board discuss matters that pertain to their remuneration.
This ensures that the same performance-setting principles are applied for Executive remunerationand for other employees in the organisation.

145

146

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Directors’ remuneration report continued
Annual Report on Remuneration
Introduction
This section of the report provides detail on how we have implemented our remuneration policy in2022 which, in accordance with the UK remuneration reporting regulations, will be subject to an advisory
shareholder vote at our 2023 Annual General Meeting.

Activities of the Remuneration Committee during 2022
During 2022, the key Remuneration Committee activities were to:• undertake extensive shareholder consultation to understand different views on our remuneration
approach and explain the Committee’s decisions;• review and sign off the 2021 Directors’ Remuneration Report;• review the 2022 base salary for the Chief Executive Officer;• review and approve the 2022 base salaries for the Executive Leadership Team members andgeneral managers;• review and approve the 2021 MIP payout for the Chief Executive Officer;• review and approve payout levels for the 2021 MIP in relation to Executive Leadership Team
members and general managers;• review and approve the performance achievement of the 2019 PSP award, number of shares vestingand dividend equivalents;• set and approve 2022 PSP targets;• review award levels for 2022 PSP awards;• review short- and long-term incentive arrangements for the wider workforce;• review the assets of the Company’s Irish defined benefit pension plans;• review pay evolution for the wider workforce including actions taken to deal with inflation; and• meet with our shareholders for remuneration related matters.

Advisers to the Remuneration Committee
The Chief People and Culture Officer, the Head of Rewards and the General Counsel regularly attend
meetings of the Remuneration Committee.
While the Remuneration Committee does not have external advisers, in 2022 it authorised
management to work with external consultancy firms Willis Towers Watson and Deloitte which provided
independent advice on ad hoc remuneration issues during the year. These services are considered
to have been independent, objective and relevant to the market. Other than employee engagement
benchmarking services, Willis Towers Watson does not provide any other services to the Company
or to any individual director, Deloitte provides tax advisory and payroll services to the Company.
The total cost in connection with Willis Towers Watson’s work was €41,540 and for Deloitte €9,355,
invoiced on a time spent basis. Willis Towers Watson and Deloitte are members of the Remuneration
Consultants Group and provide advice in line with its Code of Business Conduct. Considering this,and the level and nature of the service received, the Committee remains satisfied that the advice
is objective and independent.

Coca-Cola HBC Integrated Annual Report 2022

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Non-Executive Directors’ remuneration for the years ended 31 December 2022 and 2021

Anastassis G. DavidCharlotte J. Boyle
Henrique Braun3
Olusola (Sola) David-Borha
Anna Diamantopoulou
William W. (Bill) Douglas lll
Reto Francioni
Anastasios I. Leventis
Christo Leventis
Alexandra Papalexopoulou
Bruno Pietracci4
José Octavio Reyes5
Alfredo Rivera6
Ryan Rudolph

Financial year

Base fee (€)

Audit and Risk
Committee(€)

FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021150,000
73,50082,00073,50082,00036,75082,00073,50082,00073,50082,00073,50082,00073,50082,00073,50082,00073,50082,00073,50082,00036,750–36,750–36,75082,00073,500––––––16,00014,500––32,00028,900––––––16,00014,500
–
–
–
–
–
–
–
–

1

Remuneration
Committee(€)

Nomination Committee(€)

Social Responsibility
Committee(€)

Senior Independent
Director(€)

Social security
contributions2
(€)

Total
(€)

–
–
13,00011,600
–
–
–
–
6,500
5,800
–
–
6,500
5,800
–
–
–
–
–
–
–
–
–
–
–
–
–
–

–
–
6,500
5,800
–
–
–
–
6,500
5,800
–
–
13,00011,600
–
–
–
–
–
–
–
–
–
–
–
–
–
–

–
–
–
–
–
–
–
–
6,500
5,800
–
–
–
–
13,00011,600
–
–
–
–
6,500
2,900
–
2,900
–
–
–
–

–
–
–
–
–
–
–
–
–
–
–
–
18,00015,800
–
–
–
–
–
–
–
–
–
–
–
–
–
–

–
–
–
–
6,586
2,988
7,871
7,156
8,152
7,392
–
–
7,123
6,399
–
–
–
–
–
–
7,108
3,224
–
2,249
–
–
6,586
5,977

150,000
73,500101,500
90,90088,586
39,738105,871
95,156109,652
98,292
114,000
102,400
126,623
113,099
95,00085,10082,00073,50098,00088,00095,60842,874–
41,899–36,75088,586
79,477

1. Non-Executive Director fees for 2022 were in line with the fees that were revised in 2022.
2. Social security employer contributions as required by Swiss legislation.
3. Henrique Braun was appointed to the Board of Directors on 22 June 2021. The Group applied a half-year period base fee.
4. Bruno Pietracci was appointed to the Board of Directors on 22 June 2021. The Group applied a half-year period base fee.
5. José Octavio Reyes retired from the Board of Directors on 22 June 2021. The Group applied a half-year period base fee.
6. Alfredo Rivera retired from the Board of Directors on 22 June 2021. The Group applied a half-year period base fee.

Non-Executive Directors do not participate in any of the Group’s incentive plans, nor do they receive any retirement or other taxable benefits. Fee levels in the table above were last reviewed in 2022.

147

148

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Single figure table
Single total figure of remuneration for the Chief Executive Officer for the years ended 31 December 2022 and 2021.
Base pay1€ 000s2022
2021

Zoran Bogdanovic

832

807

Cash and non-cash
benefits2€ 000s
2022
2021

461

853

Annual bonus3€ 000s
2022
2021

911

1,038

Employee Share
Purchase Plan4€ 000s
2022
2021

41

30

Long-term incentives5€ 000s
2022
2021

1,684

1,342

Retirement benefits6€ 000s
2022
2021

144

133

Total fixed remuneration€ 000s
2022
2021

1,437

1,793

Total variable
remuneration€ 000s
2022
2021

2,636

2,410

Total single figure€ 000s
2022
2021

4,073

4,203

1. Base pay’ includes the monthly instalments linked to the base salary for 2022 and 2021.
2. ‘Cash and non-cash benefits’ includes the value of all benefits paid during 2022. These are outlined in the ‘Cash and non-cash benefits’ section below and include any gross-ups for the tax benefits.
3. Annual bonus fr 2022 includes the MIP payout, receivable early in 2023 for the 2022 performance year, including the amount deferred in shares. Refer to ‘MIP performance outcomes-2022’ for details.
4. ‘Employee Share Purchase Plan’ reflects the value of Company matching share contributions under the ESPP.
5. ‘Long-term incentives’ for 2022 reflects the 2020 awards made under the Performance Share Plan and the dividend equivalent shares paid on PSP shares that will vest in early 2023. The number of shares due to vest to the Chief Executive Officer for the 2020 award is 70,044.
The Chief Executive Officer will also get 5,733 shares representing the dividend equivalents for the awarded shares for 2020, 2021 and 2022. The value reflects the number of shares multiplied by the average market price over the last three months of the financial year.
The figure will be restated in next year’s report based on the share price at vesting (as has been done for the 2019 award in the 2021 figure above). €329,512 of the €1,683,647 total vested value of the 2020 award was due to increase in share price since date of grant.
6. ‘Retirement benefits’ includes the pension plan under Swiss law. Employer contributions are 15% of annual base salary. The disclosed figure also includes risk and administration costs of €18,911.
7. No malus and clawback was operated.

Fixed pay for 2022
Base salary
In 2022, Zoran Bogdanovic’s salary was increased to €840,000 representing an increase of 3.1%
effective May 2022. Following the freeze in 2021, the Committee believed that as the Company
emerged from the COVID-19 pandemic, an increase for the CEO in line with other employees wasappropriate. The average increase for our employees was 4.4%.

Retirement benefits

Cash and non‑cash benefits
Zoran Bogdanovic received additional benefits during 2022. These included cost of living and foreignexchange rate adjustment (€330,151), private medical insurance (€5,255), partner allowance (€1,000),
home trip allowance (€2,600), tax support (€10,772), company car (€21,425), housing allowance(€105,952), Company matching contribution related to the ESPP (€40,525 – reflecting the
maximum match of 3% under the plan), tax equalisation (€-146,188), and the value of social security
contributions (€129,567).

Zoran Bogdanovic receives an annual retirement benefit of 15% of base salary, aligning to theretirement benefit provided under Swiss law and based on the age brackets defined by federal Swiss
legislation. During the year, €143,661 of retirement benefit was received inclusive of €18,911 for risk
and administration costs.

Variable pay for 2022

Normal retirement age for the Chief Executive Officer’s plan is 65 years. In case of early retirement,
which is possible from the age of 58, the Chief Executive Officer is entitled to receive the amountaccrued under the plan as a lump sum.

• Net Sales Revenue, with an opportunity of 56% of salary for maximum performance (28% of salary
for target performance).
• Comparable EBIT, with an opportunity of 56% of salary for maximum performance (28% of salary
for target performance).
• Free cash flow, with an opportunity level of 28% of salary for maximum performance (14% of salary
for target performance).

MIP performance outcomes – 2022
The Business Performance element for the 2022 MIP was based on the following metrics:

The outcome of the business performance element is multiplied by the outcome for the individual
performance element.

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

The CEO’s individual performance metrics were measured versus the following priorities in 2022.

The Remuneration Committee considered the above formulaic outcome to ensure that it was both fair
and appropriate given the wider stakeholder experience described above and the wider performanceassessment as set out in the Remuneration Committee Chair’s letter earlier on in this report. The annual
bonus award in respect of the 2022 financial year for the Chief Executive Officer was therefore €911,400
and 108.5% of salary. The Committee judged that this outcome was appropriate and did not apply
a discretionary adjustment.

Corporate
Governance

Strategic
ReportFinancial
Statements

Swiss Statutory
ReportingDirectors’ remuneration report continued

Priorities

Achievement

Business
Performance

Increase volume
Volume increased 12.3% versus 2021
Increase organic revenue
Organic revenue growth 14.2% increase, excluding
growth by 6%
Russia and Ukraine it is 22.7%
Increase comparable EBIT
Comparable EBIT 11.9% increase and 1.3% organic
New
Acquisition of Egypt
Successful completion of the acquisition of Egypt
acquisitions
Acquisition of Three Cents
and Three Cents
Employee
Maintain or increase employee Employee engagement remained stable at 85%
Engagement
engagement versus prior year versus prior year
Sustainability Reduction in CO2 and increase Energy efficient coolers from 49% in 2022 versus
42% in 2021
Commitments energy efficient coolers
Progress towards World
48% primary packaging collected for recycling
without waste
versus 46% in 2021
Increase in number of women Overall women in management increased fromin management
39,2% to 39.6% and women in Senior leader
positions increased from 36.5% to 39.5%
Increase the number that have Over 790,000 young people from 2017 to 2022 haveaccess to #YouthEmpowered access versus 548,000 in 2021

The Remuneration Committee took into account the following additional achievements during 2022.
• Handling of the challenges posed by the Russia-Ukraine war and the humanitarian support to Ukraine
during the war.
• First ever green bond issued (500m EUR).
• Number one contributor to revenue growth for our retail customers.
• Recognised in the DJSI as leading Beverage company and top scores in S&P Global Sustainability Yearbook.
Due to the onset of the war in Ukraine, we have taken the decision to exclude Ukraine and Russia fromboth the targets as well as the actuals in calculating the payout. None of our business units havereceived government aid in 2022.
The CEO’s individual financial metrics were measured as follows:
MetricPerformance level (payout % of Target opportunity)
Threshold (0%)
Target (100%)
Maximum (200%)

Achievement

Payout (% ofbase salary)

Net Sales Revenue (€m)

6,348.5

6,900.5

7,452.6

7,857.3

56.0%

Comparable EBIT (€m)

643.9

699.9

755.9

692.4

24.5%

Free Cash Flow (€m)

411.5

447.2

492.0

503.7

28.0%

Total (business performance multiplied by individual performance)

108.5%In accordance with the terms of the MIP, 50% of the award will be paid out in March 2023 and theremaining 50% will be deferred into shares for a period of three years. MIP payouts are not driven byshare price appreciation.

Performance Share Plan (PSP) awards – 2022
The PSP is the Company’s primary long-term incentive vehicle. In March 2022, the Chief Executive
Officer was granted a performance share award over 140,502 shares under the PSP, representing
330% of base salary at date of grant.
The award is subject to a three-year performance period, aligned to the Company’s financial year, withperformance measured to the end of financial year 2024, and vesting anticipated in March 2025. These
vested shares will then be subject to a further two-year holding period, and the Chief Executive Officer
agrees to a no-sale commitment during this time.
The Committee was mindful of share price volatility at the time of grant and will retain the right toappropriately apply discretion to the share award outcome at the time of vesting, if the level ofvesting and value delivered is not considered to be appropriate taking into account an assessmentof performance.
The following table sets out the details of the performance share award made to the Chief Executive
Officer under the PSP for 2022.
Performance share award over 140,502 shares,
Type of award madereceivable for nil cost
Share price at date of grant€19.14 (£15.98)
Date of grant
16 March 2022
Performance period
1 January 2022 to 31 December 2024
€2,689,208
Face value of the award(The maximum number of shares that would vest if
all performance measures and targets are met,
multiplied by the share price at the date of grant)
Face value of the award as a % of annual base salary 330%
25% of maximum award
Percentage that would be distributed if thresholdperformance was achieved in both PSP key
performance indicators
10.625% (EPS or ROIC) / 3.75%
Percentage that would be distributed if threshold(reduction in CO2 emissions)performance was achieved only in one PSP key
performance indicatorof maximum award

149

150

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Similar to the award made in March 2021, the 2022 award was subject to comparable earnings per share(EPS) and return on invested capital (ROIC) and reduction in CO2 emissions targets as outlined below.
The financial measures are key measures of business performance. The reduction in greenhouse gas
emissions metric was selected to directly align with and incentivise delivery of the Company’s ESG
objectives, particularly our ambitious goal to achieve net zero emissions across our entire value chain by
2040. The CO2 emissions target in the PSP implicitly captures reduction in plastics, which was a key
driver of its selection as a metric.
In light of the heightened uncertainty as a result of the Russia-Ukraine war, the Committee temporarily
postponed target setting at the date of grant in March 2022 as the Group had significant operations inboth countries ROIC and EPS. The targets summarised below were disclosed via the London Stock
Exchange’s regulatory news service (RNS) in September 2022. These targets exclude Russia and Ukraine.

MeasureComparable EPS

Description

Calculated by dividing thecomparable net profit attributable
to the owners of the parent by
the weighted average numberof outstanding shares during
the period.
Return on invested ROIC is the percentage return that
capital (ROIC)
a company makes on its invested
capital. More specifically, wedefine ROIC as the percentage ofcomparable net profit excluding net
finance costs divided by the capital
employed. Capital employed is
calculated as the average of net
debt and shareholders’ equity
attributable to the owners of theparent through the year.
Reduction in CO2 This target supports theemissionsCompany’s ambitious goal toachieve net zero emissions acrossits entire value chain by 2040.
1.5 degree Celsius scenarios
approved by the Science Based
Targets initiative (SBTi) andcalculated as thousand tonnes of
CO2 emissions equivalent.

WeightingThreshold
Vesting
Target (% of max)

Maximum
Vesting (%Targetof max)

42.5%

1.38p

1.62p

25%

100%

Performance Share Plan (PSP) outcomes of the 2020-2022 award
The table below summarises performance against the applicable targets for PSP awards made in 2020,
which are due to vest in March 2023.

MeasureComparable EPS
ROIC

Weighting50%
50%

ThresholdTargetVesting

1.79p
13.9%

25%
25%

Maximum
TargetVesting

1.98p
15.9%

100%
100%

ActualAchievement
Vesting

1.70p
15.8%

0%
96%

Total
(% of max)48%

Based on performance against the targets, the formulaic outcome was a vesting level of 48%.
In light of the external challenges facing the business, the Committee believed that the financial outcomesachieved reflected strong performance and that the vesting outcome was appropriate. It therefore
determined not to make any adjustment to the formulaic outcome. The above results include Russia
and Ukraine but exclude Egypt as at the time that targets were set in March 2020, Egypt was not part of
the Group. Further detail and additional context is provided in the Remuneration Committee Chair’s letter.

Dilution limit
Usage of shares under all share plans and executive share plans adheres to the dilution limits set by
the Investment Association Principles of Remuneration (10% for all share plans and 5% for all executive
share plans, in any 10-year period).

42.5% 11.5%

15%

2,921

25%

13.4%

100%

25%

2,720

100%

The vesting schedule for PSP performance conditions is a straight line between the threshold andmaximum performance levels.

Implementation of policy in 2023
For 2023, we will continue to apply the remuneration policy approved by shareholders in 2022, as outlined
on pages 137 to 140.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Base salary and fees
2023 salary increase levels for employees have not been finalised at the date of this report. It is anticipatedthat the Chief Executive Officer’s increase will not be higher than the increases provided for thewider workforce.

It is intended that, as in past years, the three-year performance conditions applicable to the award willcontinue to be based on ROIC and EPS as well as the reduction of CO2 emissions metric which was first
introduced in 2021.

Revised Chairman and Board fees effective June 2022 were approved during the AGM 2022. The newfees were disclosed in the 2021 IAR. They are as follows:

The weightings will be 42.5% for ROIC, 42.5% for EPS and 15% for reduction of CO2 emissions.
These are unchanged from 2021 and 2022. Further detail on the rationale for the increased award andthe stretch of the targets is provided in the Remuneration Committee Chair’s letter.

Non-Executive Directors’ fees

Current fees

The targets for the 2023 PSP award are as follows:

Chairman fee
Basic fee
Senior Independent Director
Audit and Risk Committee Chair
Audit and Risk Committee member
Remuneration/Nomination/Social Responsibility Committee Chair
Remuneration/Nomination/Social Responsibility Committee member€150,000€82,000€18,000€32,000€16,000€13,000€6,500The increase of fees for the Chairman better reflects the time commitment required for the role andthe Committee notes that the new fees remain below market levels.

PSP 2023-2025

MeasureDescription

EPS

Calculated by dividing the comparable
net profit attributable to the ownersof the parent by the weighted average
number of outstanding shares during
the period.
ROIC is the percentage return that acompany makes on its invested capital.
More specifically, we define ROIC as thepercentage of comparable net profit
excluding net finance costs divided by
the capital employed. Capital employedis calculated as the average of net debt
and shareholders’ equity attributable
to the owners of the parent throughthe year.
This target supports the Company’s
ambitious goal to achieve net zero
emissions across its entire value chain
by 2040. Aligned with science and 1.5
degree Celsius scenarios and approvedby the Science Based Targets initiative(SBTi) and calculated as thousand
tonnes of CO2 emissions equivalent.

ROIC

Management Incentive Plan (MIP)The MIP operates on a multiplicative basis. The outcome will be determined by business performance
multiplied by individual performance, which means that unless the business performance targets areachieved no bonus will be payable.
Business performance is measured based on performance against three KPIs: revenue (40% weighting),
comparable EBIT (40% weighting) and free cash flow (20% weighting). Targets are considered to becommercially sensitive but will be disclosed on a retrospective basis in next year’s remuneration report.
For target performance against this element the outcome will be 70%, rising to 140% for maximum
performance. For the CEO, individual performance will be assessed based on the achievement of defined
strategic objectives. Based on the Remuneration Committee’s assessment of performance against
these strategic objectives, the outcome for the individual performance element may be up to 100%.
The maximum opportunity level (which would reflect both a stretch level of business performanceand full achievement of the individual strategic objectives) for the CEO will be 140% of base salary,which is unchanged from 2022.

Performance Share Plan (PSP)Taking account of our growth ambitions over the next three-year period, and the performance of theCompany and CEO since appointment, we are proposing to grant a one-off higher performance shareaward to the CEO in 2023, representing 450% of base salary.
The proposed award level is in line with the maximum opportunity allowable under the PSP in our
Directors’ Remuneration Policy, as approved by shareholders (where a maximum award of 450% of salaryis permitted in any financial year).

Reductionof CO2Emissions

WeightingThreshold
Vesting
Target (% of max)TargetVesting(% of max)

42.5%

1.40 25.00%

1.63

100%

42.5% 11.00% 25.00%

12.90%

100%

3,851

100%

15.0%

4,037 25.00%

StretchThe performance period for 2023 awards will be the three years to the end of December 2025 andvesting will occur in March 2026. These vested shares will then be subject to a further two-year holding
period, and the Chief Executive Officer agrees to a no-sale commitment during this time.

151

152

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Annual percentage change in remuneration of Directors and employees

CEO pay ratio

The following table sets out the percentage change in remuneration for each Director and average
percentage change of employees on an annual basis.

Coca-Cola HBC is domiciled in Switzerland. We are therefore not required to report a CEO pay
ratio under UK regulations; however, we are voluntarily disclosing ratios below. We have chosen to
make a comparison with employees in Switzerland as this is the market in which our CEO is based.
The international nature of our business means that we operate in countries with a significant range
in terms of market practice for levels of remuneration and cost of living.

All Employees

2021 to2022%

Salary/fees
2020 to
2021%

2019 to20202%

Taxable benefits
2021 to2020 to2019 to
2022
2021
2020
%
%
%

2021 to2022%

Annual bonus
2020 to
2021%

2019 to
2020
%

4.39

4.59

0.00

16.34

4.19

-18.57496.50-14.799.12

Switzerland, for example, has a substantially higher cost of living and employment remunerationcompared to other countries. For this reason, comparisons with our Swiss workforce are likely to be
more informative about the pay distribution of our workforce.

104.08
3.10
11.66
11.46

–
3.20
–
–

–
0.00
–
–

–
-36.533
–
–

–
24.25
–
–

–
–
–
34.63 155.21 -28.87
–
–
–
–
–
–

–
23.00
–
–

The table below compares the 2022 single figure of remuneration for the CEO with that of the employees
who are paid at the 25th percentile (lower quartile), 50th percentile (median) and 75th percentile (upper
quartile) of the Company’s workforce based in Switzerland, ranked based on total remuneration.

Director

Anastassis
G. David1
Zoran Bogdanovic
Charlotte J. Boyle
Henrique Braun
Olusola (Sola)
David-Borha
Anna
Diamantopoulou
William W. (Bill)
Douglas lll
Reto Francioni
Anastasios
I. Leventis
Christo Leventis
Alexandra
Papalexopoulou
Bruno Pietracci
Jose Octavio
Reyes5
Alfredo Rivera5
Ryan Rudolph

11.26

–

–

–

–

–

–

–

–

11.56

–

–

–

–

–

–

–

–

11.33
11.96

–
–

–
–

–
–

–
–

–
–

–
–

–
–

–
–

11.63
11.56

–
–

–
–

–
–

–
–

–
–

–
–

–
–

–
–

11.36
11.50

–
–

–
–

–
–

–
–

–
–

–
–

–
–

–
–

–
–
11.46

–
–
–

–
–
–

–
–
–

–
–
–

–
–
–

–
–
–

–
–
–

–
–
–

1. Change in Chairman’s fee has been disclosed in the 2021 Remuneration Report as part of the policy for 2022 and approved in theJune 2022 AGM. Last change to the Chairman’s fee took place in 2018. The fee is well below the FTSE 100 median.
2. There were no salary increases in 2020 due to the COVID pandemic.
3. The decrease in taxable benefits for the Chief Executive Officer was due to tax equalization.
4. The decrease in the employee benefits figure in 2020 was due to the impact of COVID and related to the provision of office-based
benefits which were not taken up due to the increase in remote working.
5. Jose Octavio Reyes and Alfredo Rivera retired from the Board of Directors on 22 June 2021.

Year

2022
2021
2020
2019

Method25th percentile
pay ratio (P1)Medianpay ratio (P2)75th percentile
pay ratio (P3)

Option A
Option A
Option A
Option A

46:1
65:1
39:1
33:1

37:1
52:1
33:1
29:1

31:1
42:1
26:1
23:1

Option A is based on a sample of full-time Swiss employees. Their pay and benefits is calculated, andevery Swiss employee is ranked to determine P25, P50 and P75. Several Swiss employees around eachpercentile were identified to ensure that they accurately represent the relevant percentile ranking.
The methodology used to identify the lower quartile, median and upper quartile employees was to rank
all employees of the Swiss workforce on total remuneration (for employees who were in employment
for the full calendar year). Two employees around each percentile were identified to ensure they accurately
represent the relevant percentile ranking. The total remuneration for each of these employees was thencalculated consistent with the methodology applied for deriving the CEO’s single figure remuneration.
The table below sets out the total pay and benefits for the lower quartile, median and upper quartile:

Annual base salary
Total remuneration

25th percentilein €Medianin €75th percentilein €76,22988,69476,854
110,524

87,478133,480

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Total remuneration of Swiss employees includes base salary, annual bonuses, other cash compensation(e.g. overtime), other cash and non-cash benefits (e.g. company car, tax support, relocation etc.),
pension employer contributions and employer social security contributions during 2022.

250

We are satisfied that the pay ratios reported this year are consistent with our wider pay, reward andprogression policies for employees.

210

As described on page 137, we have an overall remuneration philosophy that operates throughout theGroup, ensuring that employees are fairly rewarded and that their individual contributions are linked tothe success of the Company.

170

Variable pay is an important element of our reward philosophy and a significant proportion of total
remuneration for top managers (including the CEO) is tied to the achievement of our business objectives.
As employees advance through the Company there will be the opportunity to receive higher rewards
commensurate with increased accountability and market practice. The CEO’s total remuneration has
a significantly higher proportion of variable pay in comparison with the rest of our employees. The CEO’s
remuneration will therefore increase or decrease in line with business performance, aligning it withshareholders’ interests.

Chief Executive Officer pay and performance comparison

130

90

50

Dec 12

Dec 13Coca-Cola HBC

The graph below shows the Total Shareholder Return (TSR) of the Company compared with the FTSE
100 index over a 10-year period to 31 December 2022, based on an initial investment of £100. The
Remuneration Committee believes that the FTSE 100 Index is the most appropriate index to use forhistoric performance due to the size of the Company and our listing location.

Total remuneration– single figure (€ 000s)
MIP (% of maximum)
PSP (% of maximum)

Total Shareholder Return versus FTSE 100

Dec 14

Dec 15

Dec 16

Dec 17

Dec 18Dec 19Dec 20Dec 21

Dec 22

FTSE 100

2013
Dimitris Lois

2014
Dimitris Lois

2015
Dimitris Lois

2016
Dimitris Lois

Dimitris Lois

Zoran Bogdanovic

2018
Zoran Bogdanovic

2019
Zoran Bogdanovic

2020
Zoran Bogdanovic

2021
Zoran Bogdanovic

2022
Zoran Bogdanovic

1,928
49%
–

1,918
45%
–

3,012
75%
–

2,923
55%
–

15,378
53%
90%

410
5%
–

3,710
48%
100%

2,499
56%
75%

3,340
40%
50%

4,203
91%
75%

4,073
78%
48%

2017

Dimitris Lois sadly passed away on 2 October 2017. The 2017 total remuneration values above reflect
the period 1 January 2017 to 2 October 2017. The total remuneration value for Zoran Bogdanovic
reflects the period from his appointment as Chief Executive Officer to the end of the financial year,
7 December 2017 to 31 December 2017.

153

154

Corporate
Governance

Strategic
ReportFinancial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
In reaction to the 67% in favour vote, the Committee decided to conduct an extensive shareholder
consultation, reaching out to many shareholders and engaging with all shareholders who expressed
concerns. We value our ongoing dialogue with shareholders and welcome any views on this report.

Relative importance of spend on pay (€m)
The graphic below presents the year-on-year change in total expenditure for all employees
across the Group and distributions made to shareholders in the form of dividends, sharebuy-backs and/or capital returns.
1,203.9

2022

Payments to past Directors and payments for loss of office

262.6

There were no payments made to past Directors of the Group or loss of office payments made during
the year.

Payments to appointed Directors
1,051.2

2021
Total staﬀ costs

235.8

There were no payments made to appointed Directors during the year.

Outside appointments for the Chief Executive Officer
Zoran Bogdanovic does not hold any appointments outside the Company.

Distribution to shareholders (total shares)

Total Directors’ and Executive Leadership Team members’ remuneration
Compared with the prior year, the total staff costs have increased by 14.5%, while dividends distributed
to shareholders have increased by 11.4%.

The table below outlines the aggregated total remuneration figures for Directors and Executive
Leadership Team members in the year.

Shareholder voting outcomes
The table below sets out the result of the vote on the remuneration-related resolutions at the Annual
General Meeting held in June 2022.
Resolution

Advisory vote on the UK
Remuneration Report
Advisory vote on the Swiss
Remuneration Report
Advisory vote on the
remuneration policy
Approval of the maximum
aggregate amount of
remuneration for the Board
until the next Annual
General Meeting
Approval of the maximum
aggregate amount of
remuneration for the
Executive Leadership Teamfor the next financial year

Abstentions

Votes against

181,440,565
67.17%

88,630,436
32.82%

17,699 270,088,670
0.01%

73.71%

181,440,565
67.17%

88,630,436
32.82%

17,699 270,088,670
0.01%

73.71%

259,376,317
96.03%
269,821,962

10,695,685
3.96%
204,088

16,668 270,088,670
0.01%
62,620 270,088,670

73.71%

99.92%
267,013,278

0.08%
2,998,680

n.a76,712 270,088,670

98.89%

1.11%

n.a.

Total votes castVoting rights
represented

Votes forTotal remuneration paid to or accrued for Directors, the Executive
Leadership Team and the Chief Executive Officer
Salaries and other short-term benefits
Amount accrued for performance share awards
Pension and post-employment benefits for Directors, the Executive
Leadership Team and the Chief Executive Officer

2022€ million

2021€ million

28.3
19.3
8.0

23.6
16.3
6.4

1.0

0.9

Credits and loans granted to governing bodies

73.71%

73.71%In 2022, no credits or loans were granted to active or former members of the Company’s Board,
members of the Executive Leadership Team or any related persons.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Directors’ remuneration report continued
Share ownership
The table below summarises the total shareholding as at 17 March 2023, including any outstanding shares awarded through our incentive plans, for the Chief Executive Officer and other Directors.

Name

Zoran Bogdanovic2
Anastassis G. David3
Charlotte J. Boyle
Henrique Braun
Olusola (Sola) David-Borha
Anna Diamantopoulou
William W. (Bill) Douglas III
Reto Francioni
Anastasios I. Leventis4
Christo Leventis5
Alexandra Papalexopoulou
Bruno Pietracci
José Octavio Reyes
Alfredo Rivera
Ryan RudolphWith performance measures
PSP
Unvested andsubject toShare Performance shares
performanceinterests
granted in 2022
conditions

Yes
Yes

Yes
Yes

144,826
–
–
–
–
–
–
–
–
–
–
–
–
–
–

380,685
–
–
–
–
–
–
–
–
–
–
–
–
–
–

Without performance measures
ESOP

VestedNumber of stock
options outstanding

Fully vested

Vesting at the end of
2022

ESPP
Number ofoutstanding shares
held as at 31
December 2022

69,759
–
–
–
–
–
–
–
–
–
–
–
–
–
–

132,743
–
–
–
–
–
–
–
–
–
–
–
–
–
–

132,743
–
–
–
–
–
–
–
–
–
–
–
–
–
–

–
–
–
–
–
–
–
–
–
–
–
–
–
–
–

60,711
–
–
–
–
–
–
–
–
–
–
–
–
–
–

Current
shareholding as % ofbase
Beneficially ownedsalary1

299,614
–
1,017
–
–
–
10,000
7,000
–
–
–
–
–
–
–

797%
–
–
–
–
–
–
–
–
–
–
–
–
–
–

Shareholding
guideline met1

Yes
–
–
–
–
–
–
–
–
–
–
–
–
–
–

1. The shareholding requirement was introduced from the date of the 2015 PSP award, 10 December 2015 and was updated to 300% in 2020.
2. During 2022, Zoran Bogdanovic exercised 29,734 options under the ESOP due to upcoming expiration.
3. Anastassis G. David is a beneficiary of:(a) a private discretionary trust, for the primary benefit of present and future members of the family of the late Anastasios George Leventis, that has an indirect interest with respect to 85,355,019 shares held by Kar-Tess Holding and(b) a further private discretionary trust, for the primary benefit of present and future members of the family of the late Anastasios George Leventis, that has an indirect interest with respect to 832,268 shares held by Ari Holdings Limited.
4. Anastasios I. Leventis is a beneficiary of:(a) a private discretionary trust, for the primary benefit of present and future members of the family of the late Anastasios George Leventis, that has an indirect interest with respect to 85,355,019 shares held by Kar-Tess Holding and(b) a further private discretionary trust, for the primary benefit of present and future members of the family of the late Anastasios George Leventis, that has an indirect interest with respect to 286,880 shares held by its trustee, Selene Treuhand AG and(c) a further private discretionary trust, for the primary benefit of present and future members of the family of the late Avgie Leventis, that has an indirect interest with respect to 2,138,277 shares held by Carlcan Holding Limited.
5. Christo Leventis is a beneficiary of:(a) a private discretionary trust, for the primary benefit of present and future members of the family of the late Anastasios George Leventis, that has an indirect interest with respect to 85,355,019 shares held by Kar-Tess Holding and(b) a further private discretionary trust, for the primary benefit of present and future members of the family of the late Anastasios George Leventis, that has an indirect interest with respect to 482,228 shares held by its trustee, Selene Treuhand AG and(c) a further private discretionary trust, for the primary benefit of present and future members of the family of the late Avgie Leventis, that has an indirect interest with respect to 2,138,277 shares held by Carlcan Holding Limited.

Approval of the Directors’ Remuneration Report
The Directors’ Remuneration Report set out on pages 128 to 155 was approved by the Board of Directors on 17 March 2023 and signed on its behalf by Charlotte J. Boyle, Chair of the Remuneration Committee.

Charlotte J. Boyle
Chair of the Remuneration Committee
17 March 2023

155

156

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Statement of Directors’ responsibilities
The Directors are responsible for preparing the Annual Report, including the consolidated Financial
Statements, and the Corporate Governance Report including the Remuneration Report and theStrategic Report, in accordance with applicable law and regulations.
The Directors, whose names and functions are set out on pages 98-100, confirm to the best of theirknowledge that:(a) The Annual Report, taken as a whole, is fair, balanced and understandable, and provides theinformation necessary for shareholders to assess the Group’s position and performance, businessmodel and strategy.
(b) The consolidated Financial Statements, which have been prepared in accordance with International
Financial Reporting Standards, as issued by the IASB, give a true and fair view of the assets, liabilities,
financial position and profit or loss of the Company and the undertakings included in the consolidationof the Group taken as a whole.

The activities of the Group, together with the factors likely to affect its future development,
performance, financial position, cash flows, liquidity position and borrowing facilities are describedin the Strategic Report (pages 12-92). In addition, Notes 25 ‘Financial risk management and financial
instruments’, 36 ‘Net debt’, and 27 ‘Equity’ include: the Company’s objectives, policies and processes
for managing its capital; its financial risk management objectives; details of its financial instruments andhedging activities; and its exposures to credit risk and liquidity risk. The Group has considerable financial
resources, together with long-term contracts with a number of customers and suppliers acrossdifferent countries. The Directors have also assessed the principal risks and the other matters
discussed in connection with the Viability Statement on page 82.
The Directors considered it appropriate to adopt the going concern basis of accounting in preparing
the annual Financial Statements and have not identified any material uncertainties to the Group’s
ability to continue to do so over a period of at least 12 months from the date of approval of thesefinancial statements.

(c) The Annual Report includes a fair review of the development and performance of the business andthe position of the Company and the undertakings included in the consolidated Coca-Cola HBC Grouptaken as a whole, together with a description of the principal risks and uncertainties that they face.
By order of the Board
Anastassis G. David
Chairman of the Board
March 2023

Disclosure of information required under Listing Rule 9.8.4R
For the purposes of Listing Rule 9.8.4CR, the information required to be disclosed by premium listed companies in the United Kingdom is as follows:
Listing Rule

Information to be included

Reference in report

9.8.4(1)9.8.4(2)9.8.4(4)9.8.4(5)9.8.4(6)9.8.4(7)9.8.4(8)9.8.4(9)9.8.4(10)9.8.4(11)9.8.4(12)9.8.4(13)9.8.4(14)Interest capitalised by the Group and an indication of the amount and treatment of any associated tax relief
Details of any unaudited financial information required by LR 9.2.18
Details of any long-term incentive scheme described in LR 9.4.3
Details of any arrangement under which a Director has waived any emoluments
Details of any arrangement under which a Director has agreed to waive future emoluments
Details of any allotments of shares by the Company for cash not previously authorised by shareholders
Details of any allotments of shares for cash by a major subsidiary of the Company
Details of the participation by the Company in any placing made by its parent company
Details of any contracts of significance involving a Director
Details of any contract for the provision of services to the Company by a controlling shareholder
Details of any arrangement under which a shareholder has waived or agreed to waive any dividends
Details of any arrangement under which a shareholder has agreed to waive future dividends
Agreements with a controlling shareholder

Not applicableNot applicableNot applicableNot applicableNot applicableNot applicableNot applicableNot applicableNot applicableNot applicableNot applicableNot applicableNot applicableStrategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

FINANCIALSTATEMENTS

Contents

Independent auditor’s report toCoca‑Cola HBC AG
158 Independent auditor’s report
Consolidated financial statements
166
166
167
168
169

Consolidated income statement
Consolidated statement ofcomprehensive income
Consolidated balance sheet
Consolidated statement of changes
in equity
Consolidated cash flow statement

Notes to the consolidated financial
statements
Basis of reporting
170
170
171
171
171

1. Description of business2. Basis of preparation and consolidation
3. Foreign currency and translation
4. Accounting pronouncements
5. Critical accounting estimatesand judgements
172 6. Russia-Ukraine conflict impact
Results for the year
174
176
177
178
178
180
181

7. Segmental analysis
8. Net sales revenue
9. Operating expenses
10. Finance costs, net
11. Taxation
12. Earnings per share
13. Components of othercomprehensive income

Operating assets and liabilities
181
184
186
190
192
192
194
194
195
199

14. Intangible assets
15. Property, plant and equipment
16. Interests in other entities
17. Leases
18. Inventories
19. Trade, other receivables and assets
20. Assets classified as held for sale
21. Trade and other payables
22. Provisions and employee benefits
23. Offsetting financial assets
and liabilities
200 24. Business combinations
Risk management and capital structure
203

25. Financial risk management
and financial instruments
212 26. Net debt
215 27. Equity
Other financial information
217
219
220
221
221

28. Related party transactions
29. Share-based payments
30. Contingencies
31. Commitments
32. Post balance sheet events

157

158

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Independent auditor’s report to Coca-Cola HBC AG

Report on the audit of the consolidated
financial statements

Our audit approach
Overview
Audit scope

Our opinion
In our opinion:• Coca-Cola HBC AG’s (‘Coca-Cola HBC’ or the ‘Group’) consolidated financial statements(the ‘financial statements’) give a true and fair view of the state of the Group’s affairs as at
31 December 2022 and of its profit and cash flows for the year then ended; and• the financial statements have been properly prepared in accordance with International Financial
Reporting Standards (‘IFRSs’) as adopted by the European Union (‘EU’).
We have audited the financial statements, included within the 2022 Integrated Annual Report(the ‘Annual Report’), which comprise: the consolidated balance sheet as at 31 December 2022;
the consolidated income statement, the consolidated statement of comprehensive income, theconsolidated cash flow statement, and the consolidated statement of changes in equity for the year
then ended; and the notes to the financial statements, which include a description of the significant
accounting policies.

Key audit matters

Materiality• We performed full scope audit procedures on the financial informationof 17 subsidiary undertakings in 15 countries spread across all of the Group’sreportable segments.
• We also conducted procedures around specific account balances andtransactions and analytical review procedures for other subsidiary
undertakings and Group functions.
• Taken together, the undertakings which were in scope for the purpose of ouraudit accounted for 83% of consolidated net sales revenue, 87% of consolidated
profit before tax and 87% of consolidated total assets of the Group.
• Goodwill and indefinite-lived intangible assets impairment assessment.
• Geopolitical events in Russia and Ukraine.
• Uncertain tax positions.
• Overall materiality: €41.1 million based on 5% of adjusted profit before tax(2021: €36.7 million based on 5% of profit before tax).
• Performance materiality: €30.8 million (2021: €27.5 million)

Our opinion is consistent with our reporting to the Audit & Risk Committee.

Basis for opinion
We conducted our audit in accordance with International Standards on Auditing issued by the International
Auditing and Assurance Standards Board (‘ISAs’). Our responsibilities under ISAs are further describedin the Auditor’s responsibilities for the audit of the financial statements section of our report. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence
We remained independent of the Group in accordance with the ethical requirements that are relevant
to our audit of the financial statements, which include the International Code of Ethics for Professional
Accountants (including International Independence Standards) issued by the International Ethics
Standards Board for Accountants (‘IESBA Code’), and the FRC’s Ethical Standard, as applicable to listed
public interest entities, and we have fulfilled our other ethical responsibilities in accordance with theserequirements.
To the best of our knowledge and belief, we declare that non-audit services prohibited by the IESBA Code,the FRC’s Ethical Standard and other applicable laws and regulations were not provided to the Group.
Other than those disclosed in Note 9 ‘Operating expenses’ of the financial statements, we haveprovided no non-audit services to the Group in the period from 1 January 2022 to 31 December 2022.

The scope of our audit
As part of designing our audit, we determined materiality and assessed the risks of material
misstatement in the financial statements.

Key audit matters
We attended each of the eight Audit & Risk Committee meetings held during the year. Certain meetings
involved a private discussion without management being present. We also met with the Chair of the
Audit & Risk Committee on an ad-hoc basis. During these various conversations we discussed ourobservations on a variety of matters, for example the implications of the geopolitical events involving
Russia and Ukraine, business combinations and PwC Russia’s separation from the PwC Network. In
September and December 2022, the Audit & Risk Committee discussed and challenged the audit plan.
The plan included our key Audit Matters (as set out below) and other information on our audit approachsuch as our approach to specific balances and transactions and where the latest technology would be
used to obtain better quality audit evidence.
Key audit matters are those matters that, in the auditor’s professional judgement, were of mostsignificance in the audit of the financial statements of the current year and include the most significant
assessed risks of material misstatement (whether or not due to fraud) identified by the auditors,
including those which had the greatest effect on: the overall audit strategy; the allocation of resourcesin the audit; and directing the efforts of the engagement team. These matters, and any comments wemake on the results of our procedures thereon, were addressed in the context of our audit of thefinancial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters. This is not a complete list of all risks identified by our audit.
‘Geopolitical events in Russia and Ukraine’ is a new key audit matter this year. Otherwise, the key audit
matters below are consistent with last year.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Independent auditor’s report to Coca-Cola HBC AG continued
Key audit matter
Goodwill and indefinite-lived intangible assets
impairment assessment
Refer to Note 14 ‘Intangible assets’.
Goodwill and indefinite-lived intangible assets as
at 31 December 2022 amount to €1,926.0 millionand €612.4 million, respectively.
The above amounts have been allocated toindividual cash-generating units (‘CGUs’), whichin accordance with International AccountingStandard 36 ‘Impairment of Assets’ (‘IAS 36’)
require the performance of an impairment
assessment at least annually or whenever there
is an indication of impairment. The impairment
assessment involves the determination of therecoverable amount of the CGU, being the higherof the value-in-use and the fair value less costsof disposal.
This area was a key matter for our audit due tothe size of goodwill and indefinite-lived intangible
assets balances and because the determinationof whether elements of goodwill and of indefinitelived intangible assets are impaired involves
complex and subjective estimates made bymanagement about the future results of the
CGUs. These estimates include assumptions
surrounding revenue growth rates, costs, foreignexchange rates and discount rates.
Management has identified the Egypt CGU to besensitive to reasonably possible changes in theassumptions used, which could result in thecalculated recoverable amount being lower infuture periods than the carrying value of the CGU.
Additional sensitivity disclosure has been includedin the financial statements in respect of this CGU.

How our audit addressed the key audit matter
We evaluated the appropriateness of management’s
identification of the Group’s CGUs, related control
activities and the process by which management
prepared the CGUs’ value-in-use calculations.
We tested the mathematical accuracy of the
CGUs’ value-in-use calculations and compared
the cash flow projections included therein to thefinancial budgets, approved by the directors,
covering a one-year period, and management’s
projections for the subsequent four years.
In addition, we assessed management’s past
forecasting accuracy by comparing key elementsof the prior year projections with actual results.
We challenged management’s cash flow
projections in relation to the assumptions applied
to the value-in-use calculations, taking into
account the elevated inflationary environment.
With the support of our valuation specialists, we
assessed the appropriateness of the methodology
and valuation techniques used as well as certain
assumptions including discount, annual revenue
growth, perpetuity revenue growth and foreignexchange rates.
We also evaluated management’s assessmentof the potential effect of climate change risks, suchas the cost of water, carbon emissions andexposure to extreme weather events.
We performed our independent sensitivity
analyses on the key drivers of the value-in-use
calculations for the CGUs with significant balancesof goodwill and indefinite-lived intangible assets.

As a result of our work, we found that theconclusions reached by management in relation to
As a result of the above assessments,
the impairment testing of goodwill and indefinitemanagement did not identify any impairments for lived intangible assets were supported bygoodwill and indefinite-lived assets, other than the assumptions within reasonable ranges.
impairment charge €13.7 million recognised for
We evaluated the related disclosures provided in
the Russia based operations that is discussed in
the Key Audit Matter ‘Geopolitical events in Russia the financial statements in Note 14 ‘Intangible
assets’ and concluded that these are appropriate.
and Ukraine.

Key audit matter
Geopolitical events in Russia and Ukraine
Refer to Note 6 ‘Russia-Ukraine conflict impact’
and Note 24 ‘Business combinations’.

How our audit addressed the key audit matterIn relation to the Multon Partners and Ukraine
CGUs’ impairment assessment, we followed theprocedures described in the Key Audit Matter‘Goodwill and indefinite-lived intangible assets
impairment assessment’.

The geopolitical developments involving Russia
and Ukraine alongside The Coca-Cola Company’s(‘TCCC’) decision to suspend its business in Russia
For the tangible assets, we understood theare indications of potential impairment of theprocess that management followed for Multon
operations in both countries where the Group
Partners’ impairment exercises. We worked closely
operates in accordance with IAS 36.
with the component auditors in Russia to test the
The Russia based operations consisted of themathematical accuracy of the tangible assets
Group’s subsidiary undertaking ‘Multon Partners’
impairment assessment and challenge
and one joint venture ‘Multon AO group of
management on the assumptions used in light ofcompanies’ (‘Multon JV’) accounted for under the
TCCC’s suspension of the business and sanctions
equity method. In August 2022, TCCC unilaterally
imposed. Furthermore, we leveraged the work
waived certain of its governance rights inperformed for the discount, growth and foreign
connection with its 50% interest in Multon JV.
exchange rates as described in the Key audit
As a result, the Group gained control of Multon
matter ‘Goodwill and indefinite-lived intangible
JV in accordance with International Financial
assets impairment assessment’.
Reporting Framework 10 ‘Consolidated financial
With regards to the Multon JV, we assessed,
statements’ (‘IFRS 10’).
with the support of our valuation specialists,
The Group performed impairment exercises on
the appropriateness of the methodology, theits Russia and Ukraine based operations for both
valuation techniques and the assumptions usedinterim and year-end financial reporting purposes.
by management as well as the mathematical
As a result of the above, Multon Partners incurred accuracy of their impairment model.
impairment losses of €13.7 million for goodwill andBased on our work, we found that the conclusionsof €60.9 million for tangible assets. In addition, thereached by management in relation to their
Multon JV was impaired by €52.8 million.
impairment assessments were supported by
No impairment losses were identified for theassumptions within reasonable ranges. Moreover,Ukrainian CGU.
we verified the appropriateness of the Multon JV’schange of control accounting treatment and its
Given the significance of the events describedabove as well as the related financial impact on the financial impact.
Group’s financial statements, we concluded that
this area is a key audit matter.

We evaluated the related disclosures provided in
the financial statements in Note 6 ‘Russia-Ukraine
conflict impact’ and Note 24 ‘Business combinations’and concluded that these are appropriate.

159

160

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Independent auditor’s report to Coca-Cola HBC AG continued
Key audit matter
Uncertain tax positions
Refer to Note 11 ‘Taxation’ and Note 30‘Contingencies’.
The Group operates in numerous tax jurisdictions
and is subject to periodic tax inspections, in thenormal course of business, by local tax authorities
on a range of tax matters in relation to corporatetax, transfer pricing and indirect taxes. As at 31
December 2022, the Group has current tax
liabilities of €114.4 million, while provisions for
uncertain tax positions amount to €67.5 million.
The impact of changes in local tax regulations andongoing inspections by local tax authorities, could
materially impact the amounts recorded in thefinancial statements.
Where the amount of tax payable is uncertain, theGroup establishes provisions based on
management’s estimates with respect to thelikelihood of material tax exposures crystallisingand the probable amount of the resultant liability.
We consider this area as a key audit matter given
the level of judgement and uncertainty involvedin estimating tax provisions and the complexitiesof dealing with tax rules and regulations innumerous jurisdictions.

How our audit addressed the key audit matterIn order to understand and evaluate
management’s judgement, we considered thestatus of current tax authority inspections andenquiries, the outcome of previous tax authority
inspections, judgemental positions taken in tax
returns and current year estimates as well as
recent developments in the tax jurisdictions inwhich the Group operates.
We evaluated the group’s monitoring process ofthe current tax authority inspections andchallenged management’s estimates, particularly
in respect of cases where there had beensignificant developments with tax authorities.
Our component audit teams, through the use oftax specialists with local knowledge and relevant
expertise, assessed the tax positions taken by thesubsidiary undertakings in scope, in the context ofapplying local tax laws and evaluating the local tax
assessments. Additionally, with our groupengagement team tax specialists we further
evaluated management’s estimation of tax
exposures and contingencies in order to assess
the adequacy of the Group’s tax provisions.
We held meetings with Group and local
management to discuss the individual tax positionsof the in-scope subsidiary undertakings andassessed with the support of our group engagement
tax team the Group’s overall tax exposure.
From the evidence obtained we consider theprovisions in relation to uncertain tax positions as
at 31 December 2022 to be reasonable.
We also evaluated the related disclosures provided
in the financial statements in Note 11 ‘Taxation’and Note 30 ‘Contingencies’ and concluded thatthese are appropriate.

How we tailored the audit scope
We tailored the scope of our audit to ensure that we performed sufficient work to be able to provide
an opinion on the financial statements as a whole, taking into account the operating structure of
the Group, the accounting processes and controls, and the industry in which the Group operates.
The Group operates through its trading subsidiary undertakings in Nigeria, Egypt and 27 countries in
Europe, as set out in Note 1 ‘Description of business’ and Note 7 ‘Segmental analysis’ of the financial
statements. The processing of the accounting records for these subsidiary undertakings is largely
centralised in a shared services centre in Bulgaria, except for the subsidiary undertakings in Armenia,
Belarus, Egypt, Moldova, North Macedonia, Russia and Ukraine which process their accounting records
locally. The Group also operates centralised treasury functions in the Netherlands and in Greece anda centralised procurement function for key raw materials in the Netherlands.
Based on their significance to the financial statements and in light of the key audit matters as noted
above, we identified 17 subsidiary undertakings in 15 countries spread across all of the Group’sreportable segments (including the significant trading subsidiary undertakings in Russia, Italy, Nigeria,
Poland, Romania and Switzerland) which, based on our scoping analysis, required a full scope audit of
their financial information. In addition, audit procedures were performed with respect to the centralised
treasury functions by the group engagement team and with respect to the centralised procurement
function by the component audit team in the Netherlands. The group engagement team also
performed analytical review and other procedures on balances and transactions of subsidiary
undertakings not covered by the procedures described above.
The undertakings which were in scope for the purpose of our audit accounted for 83% of consolidated
net sales revenue, 87% of consolidated profit before tax and 87% of consolidated total assets of theGroup. This, together with the additional procedures performed at Group level, gave us appropriate
audit evidence for our opinion on the financial statements.
At the planning phase of the audit process, we held a one-day virtual audit planning workshop focusing
on planning and risk assessment activities, fraud assessment, auditor independence, accounting andauditing developments, climate change considerations, geopolitical events involving Russia and Ukraine
and centralised testing procedures. This audit planning workshop was attended by all audit teams,
including those responsible for the Group’s subsidiary undertakings that are subject only to a statutory
audit. The group engagement team was also responsible for planning, designing and overseeing theaudit procedures performed at the shared services centres in Bulgaria and Greece. In addition, we
performed work centrally on IT general controls and cybersecurity risks and shared audit comfort withthe component teams. The group engagement team performed audit procedures with respect to
the Group consolidation, financial statements disclosures and a number of other areas that involve
significant judgement and estimates, including goodwill and intangible assets and the Group’s overall
going concern assessment.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Independent auditor’s report to Coca-Cola HBC AG continued
We issued formal, written instructions to the component teams setting out the work to be performedby each of them. We were in active dialogue throughout the year with the teams that conducted thesecomponent audits. In addition to holding formal periodic meetings, the group engagement team had
ongoing informal interactions with the component audit teams to be continuously updated and tomonitor their progress and the results of their procedures. Furthermore, the group engagement teamreviewed component auditor working papers and undertook other forms of interaction as considerednecessary, depending on the significance of the component and the extent of accounting and audit
issues arising. We evaluated the sufficiency of the audit evidence obtained through discussions witheach team and a review of the audit working papers. When travel restrictions eased, senior teammembers performed site visits in Bulgaria, Egypt, Italy, Poland, Romania, Switzerland and theNetherlands. These visits gave us an opportunity to meet with the local audit teams and management
to discuss the business performance and outlook, regulations and taxation, and any specific accounting
and auditing matters identified, including fraud and internal controls. Where physical attendance was
not undertaken, senior team members participated in the final audit meetings for the trading subsidiary
undertakings in Russia and Nigeria via video conference.
As part of our audit, we also made enquiries of management to understand the process adopted toassess the extent of the potential impact of climate change risk on the financial statements and support
the disclosures made. In addition, we read the minutes of the governance processes in place to assessclimate risk and the additional reporting made by the entity on climate. Management considers thatclimate change does not give rise to a potential material financial statement impact. We used ourknowledge of the Group to evaluate management’s assessment. We particularly considered how
climate change risks would impact the assumptions made in the forecasts prepared by management
used in their impairment analyses and going concern assessment. Our procedures did not identify any
material impact on the financial statements for the year ended 31 December 2022. Where climate risk
relates to a key audit matter our audit response is given in the key audit matters section of our audit
report. We considered the consistency of the disclosures in relation to climate change made in theother information within the annual report with the financial statements and knowledge from our audit.
We discussed with management and the Audit & Risk Committee the ways in which climate change
disclosures should continue to evolve as greater understanding of the actual and potential impacts
on the Group’s business is obtained.

Materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative
thresholds for materiality. These, together with qualitative considerations, helped us to determine thescope of our audit and the nature, timing and extent of our audit procedures on the individual financial
statement line items and disclosures and to evaluate the effect of misstatements, both individually andin aggregate, on the financial statements as a whole.

Based on our professional judgement, we determined materiality for the financial statements
as a whole, as follows:
Overall group materiality
How we determined it
Rationale for benchmark
applied€41.1 million (2021: €36.7 million).
5% of adjusted profit before tax (2021: 5% of profit before tax)
Our approach has changed from the previous year, where we used thereported profit before tax as the benchmark for determining overallmateriality. We consider that the reported profit before tax still remains
the principal measure used by the shareholders in assessing theunderlying performance of the Group and is a generally accepted
benchmark. However, we have adjusted this benchmark by items which,in our view, are considered unusual and infrequently occurring in
nature driven by the geopolitical events involving Russia and Ukraine.
An approach to materiality based on 5% of the adjusted profit before tax
is within the range of acceptable quantitative materiality thresholds ingenerally accepted auditing practice.

For each component in the scope of our group audit, we allocated a materiality that is less than ouroverall group materiality. The range of materiality allocated across components was from €3.0 million
to €18.0 million.
When planning the audit, we considered if multiple misstatements may exist which, when aggregated,
could exceed our overall materiality level. In order to reduce the risk of multiple misstatements which
could aggregate to this amount we used a lower level of materiality, known as performance materiality
to identify the individual balances, classes of transactions and disclosures that were subject to audit.
Our performance materiality was 75% of overall materiality, amounting to €30.8 million (2021: €27.5 million).
In determining the performance materiality, we considered a number of factors – the history of
misstatements, risk assessment and aggregation risk and the effectiveness of controls – andconcluded that an amount at the upper end of our normal range was appropriate.
Where the audit identified any items that were not reflected appropriately in the financial information,
we considered these items carefully to assess if they were individually or in aggregate material.
We agreed with the Audit & Risk Committee that we would report to them misstatements identified
exceeding €2.0 million (2021: €1.5 million) as well as misstatements below that amount that, in our view,
warranted reporting for qualitative reasons.

161

162

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Independent auditor’s report to Coca-Cola HBC AG continued
Conclusions relating to going concern

Reporting on other information

Our evaluation of the directors’ assessment of the Group’s ability to continue to adopt the going
concern basis of accounting included:

The other information comprises all of the information in the Annual Report other than the financial
statements, our auditor’s report thereon and the Swiss statutory reporting, which we obtained prior
to the date of this auditor’s report. The directors are responsible for the other information. Our opinion
on the financial statements does not cover the other information and, accordingly, we do not express
an audit opinion or, except to the extent otherwise explicitly stated in this report, any form ofassurance thereon.

• Verification that the cash flow projections used in the goodwill impairment, going concern and viability
assessments were consistent;• Review of management’s assessment supporting the Group’s ability to continue to adopt the going
concern basis of accounting, ensuring that appropriate severe but plausible downside scenarios,
including the potential impact from the geopolitical events involving Russia and Ukraine, were considered;• Assessment of the reasonableness of management’s assumptions used in the cash flow projections.
• Testing of the mathematical integrity of the cash flow forecasts and reconciliation with the Board
approved budget and management’s projections for the subsequent periods;• Evaluation of the Group’s liquidity for the period under assessment by considering the Group’s
available cash resources, committed undrawn credit facilities and other debt instruments in place
as well as the maturity profile of the Group’s debt. We confirmed the outstanding amounts of thefinancing facilities and verified their nature, terms and conditions;• Consideration of whether climate change is expected to have any significant impact during the periodof the going concern assessment; and• Evaluation of the appropriateness of the related disclosures provided in the financial statements
in Note 2 ‘Basis of preparation and consolidation’.
Based on the work performed, we have not identified any material uncertainties relating to events orconditions that, individually or collectively, may cast significant doubt on the Group’s ability to continue
as a going concern for a period of at least twelve months from when the financial statements areauthorised for issue.
In auditing the financial statements, we have concluded that the directors’ use of the going concern
basis of accounting in the preparation of the financial statements is appropriate. However, because
not all future events or conditions can be predicted, this conclusion is not a guarantee as to the Group’s
ability to continue as a going concern.
In relation to the Group’s reporting on how they have applied the UK Corporate Governance Code, wehave nothing material to add or draw attention to in relation to the directors’ statement in the financial
statements about whether the directors considered it appropriate to adopt the going concern basisof accounting.
Our responsibilities and the responsibilities of the directors with respect to going concern are describedin the relevant sections of this report.

In connection with our audit of the financial statements, our responsibility is to read the otherinformation and, in doing so, consider whether the other information is materially inconsistent withthe financial statements or our knowledge obtained in the audit, or otherwise appears to be materially
misstated. If we identify an apparent material inconsistency or material misstatement, we are required
to perform procedures to conclude whether there is a material misstatement of the financial statements
or a material misstatement of the other information. If, based on the work we have performed, weconclude that there is a material misstatement of this other information, we are required to report thatfact. We have nothing to report based on these responsibilities.

Corporate governance statement
The Listing Rules require us to review the directors’ statements in relation to going concern, longer-term
viability and that part of the corporate governance statement relating to the Group’s compliance withthe provisions of the UK Corporate Governance Code, which the Listing Rules of the Financial Conduct
Authority specify for review by auditors of premium listed companies. Our additional responsibilities withrespect to the corporate governance statement as other information, are described in the Reportingon other information section of this report.
Based on the work undertaken as part of our audit, we have concluded that each of the following
elements of the corporate governance statement is materially consistent with the financial statements
and our knowledge obtained during the audit, and we have nothing material to add or draw attention
to in relation to:• The directors’ confirmation that they have carried out a robust assessment of the emerging andprincipal risks;• The disclosures in the Annual Report that describe those principal risks, what procedures are in place
to identify emerging risks and an explanation of how these are being managed or mitigated;• The directors’ statement in the financial statements about whether they considered it appropriate
to adopt the going concern basis of accounting in preparing them, and their identification of any
material uncertainties relating to the Group’s ability to continue to do so over a period of at least
twelve months from the date of approval of the financial statements;• The directors’ explanation as to their assessment of the Group’s prospects, the period thisassessment covers and why the period is appropriate; and• The directors’ statement as to whether they have a reasonable expectation that the Group will beable to continue in operation and meet its liabilities as they fall due over the period of its assessment,
including any related disclosures drawing attention to any necessary qualifications or assumptions.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Independent auditor’s report to Coca-Cola HBC AG continued
Our review of the directors’ statement regarding the longer-term viability of the Group was substantiallyless in scope than an audit and only consisted of making inquiries and considering the directors’ process
supporting their statement; checking that the statement is in alignment with the relevant provisions of
the UK Corporate Governance Code; and considering whether the statement is consistent with thefinancial statements and our knowledge and understanding of the Group and its environment obtainedin the course of the audit.
In addition, based on the work undertaken as part of our audit, we have concluded that each of thefollowing elements of the corporate governance statement is materially consistent with the financial
statements and our knowledge obtained during the audit:• The directors’ statement that they consider the Annual Report, taken as a whole, is fair, balanced andunderstandable, and provides the information necessary for the members to assess the Group’s
position, performance, business model and strategy;• The section of the Annual Report that describes the review of effectiveness of risk management andinternal control systems; and• The section of the Annual Report describing the work of the Audit & Risk Committee.
We have nothing to report in respect of our responsibility to report when the directors’ statement
relating to the Group’s compliance with the Code does not properly disclose a departure from a
relevant provision of the Code specified under the Listing Rules for review by the auditors.

Responsibilities for the financial statements and the audit
Responsibilities of the directors for the financial statements
As explained more fully in the Statement of Directors’ Responsibilities in the Annual Report, thedirectors are responsible for the preparation of the financial statements in accordance with theapplicable framework and for being satisfied that they give a true and fair view. The directors are also
responsible for such internal control as they determine is necessary to enable the preparation offinancial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the Group’s ability tocontinue as a going concern, disclosing as applicable matters related to going concern and using thegoing concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s reportthat includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basisof these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above, to detect material misstatements in respectof irregularities, including fraud. The extent to which our procedures are capable of detecting
irregularities, including fraud, is detailed below.
Based on our understanding of the Group and the industry in which it operates, we considered theextent to which non-compliance with applicable laws and regulations may have a material effect on thefinancial statements, including, but not limited to, the corporate regulations arising from its listings on
the London Stock Exchange and Athens Exchange, tax laws and regulations applicable to Coca-Cola
HBC and its subsidiaries and regulations relating to unethical and prohibited business practices. We
evaluated management’s incentives and opportunities for fraudulent manipulation of the financial
statements (including the risk of override of controls), and where management made subjective
judgements in respect of significant accounting estimates that involved making assumptions andconsidering future events that are inherently uncertain. The group engagement team shared this risk
assessment with the component auditors so that they could include appropriate audit procedures in
response to such risks in their work. Audit procedures performed by the group engagement team and/or component auditors included among others:• Discussions with management, internal audit, internal legal counsel, management’s experts andexternal legal advisors, where relevant, including consideration of known or suspected instances of
non-compliance with laws and regulation and fraud;• Reviewing correspondence with regulators;• Evaluation and testing of the operating effectiveness of management’s controls designed to preventand detect irregularities;• Assessment of matters reported on the Group’s whistleblowing helpline and the results ofmanagement’s investigation of such matters;• Reading the minutes of Board meetings to identify any inconsistencies with other information
provided by management;• Challenging assumptions and judgements made by management in significant accounting estimates,in particular in relation to the key audit matters;• inspecting correspondence with legal advisors and internal audit reports in so far as they related to
the financial statements;• Identifying and testing journal entries, in particular any entries posted with unusual accountcombinations, journal entries posted by senior management and consolidation entries.
There are inherent limitations in the audit procedures described above. We are less likely to becomeaware of instances of non-compliance with laws and regulations that are not closely related toevents and transactions reflected in the financial statements. Also, the risk of not detecting a material
misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud
may involve deliberate concealment by, for example, forgery or intentional misrepresentations,or through collusion.

163

164

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Independent auditor’s report to Coca-Cola HBC AG continued
Our audit testing might include testing complete populations of certain transactions and balances,possibly using data auditing techniques. However, it typically involves selecting a limited number of
items for testing, rather than testing complete populations. We will often seek to target particular items
for testing based on their size or risk characteristics. In other cases, we will use audit sampling to enable
us to draw a conclusion about the population from which the sample is selected.
As part of an audit in accordance with ISAs, we exercise professional judgement and maintainprofessional scepticism throughout the audit. We also:• Identify and assess the risks of material misstatement of the financial statements, whether due tofraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting
a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit proceduresthat are appropriate in the circumstances, but not for the purpose of expressing an opinion on theeffectiveness of the Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the Group’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’sreport to the related disclosures in the financial statements or, if such disclosures are inadequate,
to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of
our auditor’s report. However, future events or conditions may cause the Group to cease to continue
as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including thedisclosures, and whether the financial statements represent the underlying transactions and eventsin a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities
or business activities within the Group to express an opinion on the financial statements. We areresponsible for the direction, supervision and performance of the group audit. We remain solely
responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies ininternal control that we identify during our audit. Those charged with governance are responsible foroverseeing the Group’s financial reporting process.
We also provide those charged with governance with a statement that we have complied with relevant
ethical requirements regarding independence and communicate with them all relationships andother matters that may reasonably be thought to bear on our independence, and where applicable,
related safeguards.

From the matters communicated with those charged with governance, we determine those mattersthat were of most significance in the audit of the financial statements of the current year and are
therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulationprecludes public disclosure about the matter or when, in extremely rare circumstances, we determinethat a matter should not be communicated in our report because the adverse consequences of doing
so would reasonably be expected to outweigh the public interest benefits of such communication.

Use of this report
This report, including the opinions, has been prepared for and only for Coca-Cola HBC AG for the
purpose of compliance with the Disclosure Guidance and Transparency Rules sourcebook andthe Listing Rules of the FCA and for no other purpose. We do not, in giving these opinions, accept
or assume responsibility for any other purpose or to any other person to whom this report is shownor into whose hands it may come, save where expressly agreed by our prior consent in writing.

Other required reporting
Appointment
We have been the Group’s auditors since 2003 and following a tender process that the Group
conducted in 2015, at the recommendation of the Audit & Risk Committee, we were reappointed by
the directors on 11 December 2015 to audit the financial statements for the year ended 31 December
2016 and subsequent financial periods.

Assurance Report on the European Single Electronic Format pursuant to theAthens Exchange listing requirements
We have examined the digital files of Coca-Cola HBC, which were compiled in accordance with theEuropean Single Electronic Format (ESEF) defined by the Commission Delegated Regulation (EU)2019/815, as amended by Regulation (EU) 2020/1989 (hereinafter ‘ESEF Regulation’), and which
include the consolidated financial statements of the Group for the year ended 31 December 2022,
in XHTML format 549300EFP3TNG7JGVE49-2022-12-31-en.xhtml, as well as the provided XBRL file549300EFP3TNG7JGVE49-2022-12-31-en.zip with the appropriate marking up, on the aforementioned
consolidated financial statements, including the other explanatory information (notes to thefinancial statements).
Regulatory framework
The digital files of the European Single Electronic Format are compiled in accordance with ESEF
Regulation and 2020 / C 379/01 Interpretative Communication of the European Commissionof 10 November 2020, as provided by the Greek Law 3556/2007 and the relevant announcementsof the Hellenic Capital Market Commission and the Athens Exchange (‘ESEF Regulatory Framework’).

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Independent auditor’s report to Coca-Cola HBC AG continued
In summary, this Framework includes the following requirements:

Other matters• All annual financial reports should be prepared in XHTML format.
• For consolidated financial statements in accordance with International Financial Reporting Standards,
the financial information stated the consolidated balance sheet, the consolidated income statement,
the consolidated statement of comprehensive income, the consolidated cash flow statement andthe consolidated statement of changes in equity, as well as the financial information included in theother explanatory information, should be marked-up with XBRL ‘tags’ and ‘block tag’, according to
the ESEF Taxonomy, as in force. The technical specifications for ESEF, including the relevant
classification, are set out in the ESEF Regulatory Technical Standards.

Swiss statutory reporting requirements

The requirements set out in the current ESEF Regulatory Framework are suitable criteria for formulatinga reasonable assurance conclusion.
Responsibilities of the management and those charged with governanceManagement is responsible for the preparation and submission of the consolidated financial
statements of the Group, for the year ended 31 December 2022 in accordance with the requirements
set by the ESEF Regulatory Framework, as well as for those internal controls that management
determines as necessary, to enable the compilation of digital files free of material error due to either
fraud or error.
Auditor’s responsibilities
Our responsibility is to plan and carry out this assurance work, in accordance with no. 214/4 /11.02.2022 Decision of the Board of Directors of the Hellenic Accounting and Auditing Standards
Oversight Board (HAASOB) and the ‘Guidelines in relation to the work and the assurance report of theCertified Public Accountants on the European Single Electronic Format (ESEF) of issuers with securities
listed on a regulated market in Greece’ as issued by the Board of Certified Auditors on 14/02/2022(hereinafter ‘ESEF Guidelines’), providing reasonable assurance that the consolidated financial
statements of the Group prepared by management in accordance with ESEF comply in all material
respects with the applicable ESEF Regulatory Framework.

PwC Switzerland has reported separately on the Group and Company financial statements of Coca‑Cola
HBC AG for the year ended 31 December 2022 for Swiss statutory purposes. The reports are available
in pages 223 and 228.

ESEF Regulatory Technical Standard pursuant to the London Stock Exchange
listing requirements
As required by the Financial Conduct Authority Disclosure Guidance and Transparency Rule 4.1.14R,
these financial statements form part of the ESEF-prepared annual financial report filed on the National
Storage Mechanism of the Financial Conduct Authority in accordance with the ESEF Regulatory
Technical Standard (‘ESEF RTS’). This auditors’ report provides no assurance over whether the annual
financial report has been prepared using the single electronic format specified in the ESEF RTS which
may differ from the ESEF as defined in section ‘Other required reporting’ above.

Fotis Smyrnis
the Certified Auditor, Reg. No. 52861
for and on behalf of PricewaterhouseCoopers S.A.
Certified Auditors, Reg. No. 113
Athens, Greece
20 March 2023

Our work was carried out in accordance with the Code of Ethics for Professional Accountants of theInternational Ethics Standard Board for Accountants (IESBA Code).
The assurance work we conducted is limited to the procedures provided by the ESEF Guidelines
and was carried out in accordance with International Standard on Assurance Engagements 3000,‘Assurance Engagements other than Audits or Reviews of Historical Financial Information’. Reasonableassurance is a high level of assurance, but it is not a guarantee that this work will always detect a material
misstatement regarding non-compliance with the requirements of the ESEF Regulation.
Conclusion
Based on the procedures performed and the evidence obtained, we conclude that theconsolidated financial statements of the Group for the year ended 31 December 2022, in XHTML
file format 549300EFP3TNG7JGVE49-2022-12-31-en.xhtml, as well as the provided XBRL file549300EFP3TNG7JGVE49-2022-12-31-en.zip with the appropriate marking up, on the aforementioned
consolidated financial statements, including the other explanatory information, have been prepared,in all material respects, in accordance with the requirements of the ESEF Regulatory Framework.

Notes:
a. The maintenance and integrity of the Coca-Cola HBC AG website is the responsibility of the directors; the work carried out by theauditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that
may have occurred to the financial statements since they were initially presented on the website.
b. Legislation in the UK, Greece and Switzerland governing the preparation and dissemination of financial statements may differ fromlegislation in other jurisdictions.

165

166

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Consolidated financial statements

Consolidated income statement

Consolidated statement of comprehensive income

For the year ended 31 December

For the year ended 31 December
2022€ million

2021€ million

7,8

9,198.4(6,054.2)
3,144.2

7,168.4(4,570.2)
2,598.2

9
6
9
16
7

(2,354.6)(127.4)(2,482.0)
41.6
703.8

(1,833.3)–(1,833.3)
34.4
799.3

13.2
(95.9)(82.7)
2.5
623.6

5.3
(72.9)(67.6)
3.2
734.9(208.0)415.6(187.4)
547.5

415.4
0.2
415.6

547.2
0.3
547.5

1.13
1.13

1.50
1.49

Note

Net sales revenue
Cost of goods sold
Gross profit
Operating expenses (excluding exceptional items related to
Russia-Ukraine conflict)
Exceptional items related to Russia-Ukraine conflict
Operating expenses
Share of results of integral equity method investments
Operating profit
Finance income
Finance costs
Finance costs, net
Share of results of non-integral equity method investments
Profit before tax
Tax
Profit after tax

10
16

11

Attributable to:
Owners of the parent
Non-controlling interests

Basic earnings per share (€)
Diluted earnings per share (€)

1212

The accompanying notes form an integral part of these consolidated financial statements.

2022€ million

2021€ million

415.6

547.5

25
25
13

(3.5)
34.6
(252.6)

(2.7)
69.5
73.6

13, 16

34.2

14.6

24

145.2

–

13

(3.9)
(46.0)

(9.5)
145.5

(0.1)
26.0

–
16.1

1.8
27.7
(18.3)
397.3

(6.1)
10.0
155.5
703.0

406.1
(8.8)
397.3

702.7
0.3
703.0

Note

Profit after tax
Other comprehensive income:Items that may be subsequently reclassified
to income statement:
Cost of hedging
Net gain on cash flow hedges
Foreign currency translation (losses)/gains
Share of other comprehensive income of equity
method investments
Reclassification of share of other comprehensive income ofequity method investments to the income statement, arisingfrom business combination
Income tax relating to items that may be subsequently
reclassified to income statement
Items that will not be subsequently reclassified
to income statement:
Valuation loss on equity investments at fair value throughother comprehensive income
Actuarial gains
Income tax relating to items that will not be subsequently
reclassified to income statement
Other comprehensive (loss)/income for the year, net of tax
Total comprehensive income for the year
Total comprehensive income attributable to:
Owners of the parent
Non-controlling interests

1313

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Consolidated financial statements continued

Consolidated balance sheet
As at 31 December
2022€ million

2021€ million

14
15
16
25
11
19

2,542.5
3,266.3
205.6
9.4
37.5
78.2
6,139.5

2,043.3
2,830.9
365.8
16.6
31.0
69.8
5,357.4

18
19
25, 26770.0
1,147.9
1,063.8
14.5
719.9
3,716.1
0.1
3,716.2
9,855.7

519.8
948.6
878.9
26.7
782.8
3,156.8
0.1
3,156.9
8,514.3

Note

AssetsIntangible assets
Property, plant and equipment
Equity method investments
Other financial assets
Deferred tax assets
Other non-current assets
Total non-current assets
Inventories
Trade, other receivables and assets
Other financial assets
Current tax assets
Cash and cash equivalents
Assets classified as held for sale
Total current assets
Total assets

26
20

The accompanying notes form an integral part of these consolidated financial statements.

2022€ million

2021€ million

26
25
21
22

337.0
41.9
2,331.9
181.5
114.4
3,006.7381.7
11.6
1,885.8
157.2
80.1
2,516.4

26
25
11
22

3,082.9
3.7
264.6
106.9
5.3
3,463.4
6,470.1

2,555.7
3.0
197.7
118.8
5.6
2,880.8
5,397.2

27
27
27
27
27
27

2,024.3
2,837.4(6,472.1)(131.2)(1,218.2)
292.5
5,949.6
3,282.3
103.3
3,385.6
9,855.7

2,022.3
3,097.3(6,472.1)(146.6)(1,154.0)
310.2
5,457.4
3,114.5
2.6
3,117.1
8,514.3

Note

Liabilities
Borrowings
Other financial liabilities
Trade and other payables
Provisions and employee benefits
Current tax liabilities
Total current liabilities
Borrowings
Other financial liabilities
Deferred tax liabilities
Provisions and employee benefits
Other non-current liabilities
Total non-current liabilities
Total liabilities
EquityShare capital
Share premiumGroup reorganisation reserve
Treasury shares
Exchange equalisation reserve
Other reserves
Retained earnings
Equity attributable to owners of the parent
Non-controlling interests
Total equity
Total equity and liabilities

167

168

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Consolidated financial statements continued

Consolidated statement of changes in equity
Attributable to owners of the parent
Group
Exchange
Share reorganisation
Treasuryequalisation
premium
reservesharesreserve€ million€ million€ million€ million

Other
reserves€ million

Retainedearnings€ million

Total€ million

Noncontrollinginterests€ million

Total equity€ million

2,014.4
7.9

3,321.4
11.7(6,472.1)–(155.5)–(1,242.1)
–

266.7
–

4,897.9–

2,630.7
19.6

2.6
–

2,633.3
19.6

–
–
–
–
–
2,022.3–––
2,022.3
2.0–––(235.8)–3,097.3–––
3,097.3
2.7

–
–
–
–
–
(6,472.1)–––(6,472.1)
–

–
–
8.9
–
–
(146.6)–––(146.6)
–

–
–
–
–
–
(1,242.1)
–
88.1
88.1
(1,154.0)
–

15.1
(0.1)
(9.0)
–
(19.9)
252.8
–
57.4
57.4
310.2
–

–
–
0.1
2.2
–
4,900.2
547.2
10.0
557.2
5,457.4
–

15.1
(0.1)
–
(233.6)(19.9)
2,411.8
547.2
155.5
702.7
3,114.5
4.7

–
–
–
(0.3)
–
2.3
0.3
–
0.3
2.6
–

15.1
(0.1)
–
(233.9)(19.9)
2,414.1
547.5
155.5
703.0
3,117.1
4.7

–
–
–
–
–
–
–
2,024.3–––
2,024.3–––––(262.6)–
2,837.4–––
2,837.4

–
–
–
–
–
–
–
(6,472.1)–––(6,472.1)

–
–
15.4
–
–
–
–
(131.2)–––(131.2)

–
–
–
–
–
–
–
(1,154.0)–(64.2)(64.2)(1,218.2)

16.6
1.2(21.1)–––(41.5)
265.4
–
27.1
27.1
292.5

–
–
5.7
–
40.9
2.4
–
5,506.4
415.4
27.8
443.2
5,949.6

16.6
1.2
–
–
40.9
(260.2)(41.5)
2,876.2
415.4
(9.3)
406.1
3,282.3

–
–
–
259.6
(149.8)
(0.3)
–
112.1
0.2
(9.0)
(8.8)
103.3

16.6
1.2
–
259.6
(108.9)(260.5)(41.5)
2,988.3
415.6(18.3)
397.3
3,385.6

Share capital€ million

Balance as at 1 January 2021
Shares issued to employees exercising stock options
Share-based compensation:
Performance shares
Movement in shares held for equity compensation plan
Appropriation of reserves
Dividends
Transfer of cash flow hedge reserve, including cost of hedging to inventories, net of tax1
Profit for the year, net of tax
Other comprehensive income for the year, net of tax
Total comprehensive income for the year, net of tax2
Balance as at 31 December 2021
Shares issued to employees exercising stock options
Share-based compensation:
Performance shares
Movement in shares held for equity compensation plan
Appropriation of reserves
Non-controlling interests on business combinations
Purchase of shares held by non-controlling interests
Dividends
Transfer of cash flow hedge reserve, including cost of hedging to inventories, net of tax3
Profit for the year, net of tax
Other comprehensive loss for the year, net of tax
Total comprehensive income for the year, net of tax4
Balance as at 31 December 2022

1. The amount included in other reserves of €19.9 million gain for 2021 represents the cash flow hedge reserve, including cost of hedging, transferred to inventories of €24.0 million gain, and the deferred tax expense thereof amounting to €4.1 million.
2. The amount included in the exchange equalisation reserve of €88.1 million gain for 2021 represents the exchange gain attributable to owners of the parent, including €14.5 million gain relating to the share of other comprehensive income of equity method investments.
The amount of other comprehensive income, net of tax included in other reserves of €57.4 million gain for 2021 consists of cash flow hedges gain of €66.8 million, share of other comprehensive income of equity method investments of €0.1 million gain and the deferred tax
expense thereof amounting to €9.5 million.
The amount of €557.2 million gain attributable to owners of the parent comprises profit for the year, net of tax of €547.2 million, actuarial gains of €16.1 million and deferred tax expense thereof amounting to €6.1 million.
The amount of €0.3 million gain included in non-controlling interests for 2021 represents the share of non-controlling interests in profit for the year, net of tax.
3. The amount included in other reserves of €41.5 million gain for 2022 represents the cash flow hedge reserve, including cost of hedging, transferred to inventories of €51.4 million gain, and the deferred tax expense thereof amounting to €9.9 million.
4. The amount included in the exchange equalisation reserve of €64.2 million loss for 2022 represents the exchange loss attributable to owners of the parent, including €34.8 million gain relating to the share of other comprehensive income of equity method investmentsand €144.6 million relating to reclassification of share of other comprehensive loss of equity method investments to the income statement arising from business combination.
The amount of other comprehensive income, net of tax included in other reserves of €27.1 million gain for 2022 consists of cash flow hedges gain of €31.1 million, share of other comprehensive income of equity method investments of €0.6 million loss, valuation lossesof €0.1 million on equity investments at fair value through other comprehensive income, €0.6 million gain relating to reclassification of share of other comprehensive income of equity method investments to the income statement arising from business combination,and the deferred tax expense thereof amounting to €3.9 million.
The amount of €443.2 million gain attributable to owners of the parent comprises profit for the year, net of tax of €415.4 million, actuarial gains of €26.0 million and the deferred tax income thereof amounting to €1.8 million.
The amount of €8.8 million loss included in non-controlling interests for 2022 represents the exchange loss attributed to the non-controlling interests of €9.0 million, and the share of non-controlling interests in profit for the year, net of tax of €0.2 million.

For further details, refer to Note 13 ‘Components of other comprehensive income’, Note 25 ‘Financial risk management and financial instruments’, Note 27 ‘Equity’, Note 24 ‘Business combinations and Note 29‘Share-based payments’.
The accompanying notes form an integral part of these consolidated financial statements.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Consolidated financial statements continued

Consolidated cash flow statement
For the year ended 31 December

Operating activities
Profit after tax
Finance costs, net
Share of results of non-integral equity method investments
Tax charged to the income statement
Depreciation of property, plant and equipment including
right-of-use assets
Impairment of property, plant and equipment
Employee performance shares
Amortisation of intangible assets
Impairment of intangible assets
Impairment of equity method investments
Other non-cash items
Share of results of integral equity method investments
Loss/(Gain) on disposals of non-current assets
Increase in inventories
Increase in trade and other receivables
Increase in trade and other payables
Tax paid
Net cash inflow from operating activities

Note

2022
€ million

2021€ million

10
16
11

415.6
82.7
(2.5)
208.0

547.5
67.6
(3.2)
187.4

403.4
81.5
16.5
1.4
13.7
52.8
70.5
1,343.6(41.6)
1.5(241.1)(104.7)472.6(195.7)
1,234.6

330.3
6.0
14.9
1.0
–
–
–
1,151.5(34.4)(28.4)(114.5)(109.0)419.3(142.3)
1,142.2

15,17
15
14
14
6
24
16
9

The accompanying notes form an integral part of these consolidated financial statements

Investing activities
Payments for purchases of property, plant and equipment
Proceeds from sales of property, plant and equipment
Payment for business combinations, net of cash acquired
Proceeds from settlement of derivatives relating tobusiness combination
Payment for acquisition of joint operation
Payment for integral equity method investment
Receipts from integral equity method investments
Payments for non-integral equity method investments
Receipts from non-integral equity method investments
Net payments for investments in financial assets at
amortised cost
Net proceeds from/(payments for) investments in financial
assets at fair value through profit or loss
Loans to related parties
Repayments of loans by related parties
Interest received/(paid)
Net cash outflow from investing activities
Financing activities
Proceeds from shares issued to employees exercisingstock options
Purchase of shares from non-controlling interests
Proceeds from borrowings
Repayments of borrowings
Principal repayments of lease obligations
Dividends paid to owners of the parent
Dividends paid to non-controlling interests
Proceeds from settlement of derivatives regarding
financing activities
Interest paid
Net cash outflow from financing activities
Net decrease in cash and cash equivalents
Movement in cash and cash equivalents
Cash and cash equivalents at 1 January
Net decrease in cash and cash equivalents
Effect of changes in exchange rates
Cash and cash equivalents at 31 December

Note

2022
€ million

2021€ million

24(523.4)
7.5(399.2)(506.5)
35.8
(5.6)

13.0
–
(4.0)
9.7
(6.5)
1.8

–
(0.9)
–
47.8
(87.0)
1.9(333.4)(102.8)

142.6
(0.4)
2.0
7.2
(1,083.1)(640.6)
(0.9)
–
(0.3)
(1,259.1)

27
24
26
26
26
27

4.7
(108.9)650.0(358.6)(65.2)(260.2)
(0.2)

19.6
–
129.3
(133.8)(63.1)(233.6)
(0.2)

26
26

0.1
(60.4)(198.7)(47.2)

4.9(45.5)(322.4)(439.3)782.8(47.2)(15.7)
719.9

1,215.8(439.3)
6.3
782.8

24
16,28
28
16
28

26

169

170

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements

Notes to the consolidated financial statements
1. Description of businessCoca-Cola HBC AG and its subsidiaries (the ‘Group’ or ‘Coca-Cola HBC’ or ‘the Company’) are principally
engaged in the production, sales and distribution of primarily non-alcoholic ready-to-drink beverages,
under franchise from The Coca-Cola Company. The Company distributes its products in Nigeria, Egypt
and 27 countries in Europe. Information on the Company’s operations by segment is included in Note 7.
On 11 October 2012, Coca-Cola HBC, a Swiss stock corporation (Aktiengesellschaft / Société
Anonyme) incorporated by Kar-Tess Holding (a related party of the Group, refer to Note 28),
announced a voluntary share exchange offer to acquire all outstanding ordinary registered shares andall American depositary shares of Coca-Cola Hellenic Bottling Company S.A. As a result of thesuccessful completion of this offer, on 25 April 2013 Coca-Cola HBC acquired 96.85% of the issued
Coca-Cola Hellenic Bottling Company S.A. shares, including shares represented by American
depositary shares, and became the new parent company of the Group. On 17 June 2013, Coca-Cola
HBC completed its statutory buy-out of the remaining shares of Coca-Cola Hellenic Bottling Company
S.A. that it did not acquire upon completion of its voluntary share exchange offer. Consequently,
Coca-Cola HBC acquired 100% of Coca-Cola Hellenic Bottling Company S.A. which was eventuallydelisted from the Athens Exchange, from the London Stock Exchange where it had a secondary listing
and from the New York Stock Exchange where American depositary shares were listed.
The shares of Coca-Cola HBC started trading in the premium segment of the London Stock Exchange(Ticker symbol: CCH) and on the Athens Exchange (Ticker symbol: EEE) and regular way trading in
Coca-Cola HBC American depositary shares commenced on the New York Stock Exchange (Ticker
symbol: CCH) on 29 April 2013. On 24 July 2014 the Group proceeded to the delisting of its American
depository shares from the New York Stock Exchange and terminated its reporting obligations under
the US Securities Exchange Act of 1934. The deregistration of Coca-Cola HBC shares under the US
Securities Exchange Act of 1934 and the termination of its reporting obligations became effective on 3
November 2014.

2. Basis of preparation and consolidation
Basis of preparation
The consolidated financial statements of the Group have been prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by the European Union (EU) and incompliance with Swiss law.
These consolidated financial statements were approved for issue by the Board of Directors on 17
March 2023 and are expected to be verified at the Annual General Meeting to be held on 17 May 2023.

Going concern
The financial statements have been prepared on a going concern basis. In adopting the going concern
basis for the preparation of these consolidated financial statements, management has considered theGroup’s financial performance in the year, the expected extension of the bottlers’ agreements with The
Coca-Cola Company beyond 31 December 2023, as well as a quantitative viability exercise linked to theGroup’s principal risks, including those relating to climate change and the geopolitical events involving
Russia and Ukraine. Management has reviewed the financial forecasts and funding requirements withconsideration given to the potential impact of severe but plausible downside scenarios. Even underthese scenarios, the Group’s cash position is still expected to remain strong over the period of thefinancial forecasts, considering also that there are mitigating actions the Group could take, should they
be required, by making adjustments to its operating plans within the normal course of business.
After assessing the Group’s current strong balance sheet and liquidity position, the committed funding
facilities and the financial forecasts, management confirms the Group’s ability to generate cash for aperiod of 12 months from the date of approval of these consolidated financial statements and beyond.
Therefore, it is deemed appropriate that the Group continues to adopt the going concern basis for the
preparation of the consolidated financial statements under the historical cost convention, as modified
by the revaluation of financial assets at fair value through profit or loss, investments in equity instruments
classified at fair value through other comprehensive income and derivative financial instruments.

Basis of consolidation
Subsidiary undertakings are those companies over which the Group, directly or indirectly, has control.
The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those returns through power over the entity.
Subsidiary undertakings are consolidated from the date on which control is transferred to the Groupand cease to be consolidated from the date on which control is transferred out of the Group.
Transactions with non-controlling interests that do not result in loss of control are accounted for as
equity transactions – that is, as transactions with the owners in their capacity as owners. The difference
between fair value of any consideration paid and the relevant acquired share of the carrying value of net
assets of the subsidiary is recorded in equity.
Inter-company transactions and balances between Group companies are eliminated. The subsidiaries’
accounting policies are consistent with policies adopted by the Group.
When the Group ceases to have control, any retained interest in the entity is remeasured to its fair value
at the date when such control is lost, with the change in carrying amount recognised in the income
statement. The fair value is the initial carrying amount for the purposes of subsequently accounting forthe retained interest as an associate, joint venture or financial asset. In addition, any amounts previously
recognised in other comprehensive income in respect of that entity are accounted for as if the Group
had directly disposed of the related assets or liabilities. This means that amounts previously recognisedin other comprehensive income, if any, are reclassified to the income statement.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
3. Foreign currency and translation
The individual financial statements of each Group entity are presented in the currency of the primaryeconomic environment in which the entity operates (its functional currency). For the purposes of theconsolidated financial statements, the results and financial position of each entity are expressed inEuro, which is the presentation currency for the consolidated financial statements.
The assets and liabilities of foreign subsidiaries are translated into Euro at the exchange rate prevailingat the balance sheet date. The results of foreign subsidiaries are translated into Euro using the averagemonthly exchange rate (being a reasonable approximation of the rates prevailing on the transaction
dates). The exchange differences arising on translation are recognised in other comprehensive income.
On disposal of a foreign entity, accumulated exchange differences are recognised as a component of
the gain or loss on disposal.
Transactions in foreign currencies are recorded at the rate ruling at the date of transaction. Monetary
assets and liabilities denominated in foreign currencies are remeasured at the rate of exchange ruling at
the balance sheet date. All gains and losses arising on remeasurement are included in the income
statement, except for exchange differences arising on assets and liabilities classified as cash flow
hedges, which are deferred in equity until the occurrence of the hedged transaction, at which time they
are recognised in the income statement. Share capital denominated in a currency other than thefunctional currency is initially stated at the spot rate of the date of issue but is not retranslated.
The principal exchange rates used for translation purposes in respect of one Euro are:

US Dollar
UK Sterling
Polish Zloty
Nigerian Naira
Hungarian Forint
Swiss Franc
Russian Rouble
Romanian Leu
Ukrainian Hryvnia
Czech Koruna
Serbian Dinar
Egyptian Pound

Average
2022

Average
2021

Closing2022

Closing
2021

1.05
0.85
4.68
448.99390.36
1.01
74.01
4.93
33.92
24.56
117.47
20.09

1.18
0.86
4.56
484.31358.49
1.08
87.23
4.92
32.30
25.64
117.57
–

1.06
0.88
4.69
493.61401.54
0.99
79.23
4.94
38.94
24.21
117.30
26.35

1.13
0.84
4.60
481.32370.08
1.04
83.87
4.95
30.78
24.95
117.56–

4. Accounting pronouncementsa) Accounting pronouncements adopted in 2022
The Group has adopted the following amendments which were endorsed by the EU that are relevant
to its operations and effective for accounting periods beginning on 1 January 2022:• Property, Plant and Equipment: Proceeds before Intended Use – Amendments to IAS 16• Onerous Contracts – Cost of Fulfilling a Contract – Amendments to IAS 37• Reference to the Conceptual Framework – Amendments to IFRS 3• Annual Improvements to IFRS Standards 2018 – 2020; and• COVID-19-Related Rent Concessions beyond 30 June 2021 – Amendments to IFRS 16
The adoption of these amendments did not have a material impact on the consolidated financial
statements of the Group.

b) Accounting pronouncements not yet adopted
At the date of approval of these consolidated financial statements, the following amendments relevantto the Group’s operations were issued but not yet effective and not early-adopted:• Classification of Liabilities as Current or Non-current – Amendments to IAS 1 (not endorsed by the EU)• Disclosure of Accounting Policies – Amendments to IAS 1• Definition of Accounting Estimates – Amendments to IAS 8• Deferred Tax related to Assets and Liabilities arising from a Single Transaction – Amendments to IAS 12• Lease Liability in a Sale and Leaseback – Amendments to IFRS 16 (not endorsed by the EU); and• Non-current Liabilities with Covenants – Amendments to IAS 1 (not endorsed by the EU)
The above amendments are not expected to have a material impact on the consolidated financial
statements of the Group.

5. Critical accounting estimates and judgements
In conformity with IFRS, the preparation of the consolidated financial statements for Coca-Cola HBC
requires management to make estimates and judgements that affect the reported amounts of assets,
liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities in the
consolidated financial statements and accompanying notes. Although these estimates and judgements
are based on management’s knowledge of current events and actions that may be undertaken in the
future, actual results may ultimately differ from estimates.

Estimates
The key items concerning the future and other key sources of estimation uncertainty at the reporting
date, that have a significant risk of causing a material adjustment to the carrying amounts of assets andliabilities within the next financial year, are described below:• Impairment of goodwill and indefinite-lived intangible assets (refer to Note 14); and• Employee benefits – defined benefit pension plans (refer to Note 22)

Judgements
In the process of applying the Group’s accounting policies, management has made the following
judgements, apart from those involving estimations as described above, which have the mostsignificant effect on the amounts recognised in the consolidated financial statements:• Joint arrangements (refer to Note 16)

171

172

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
6. Russia-Ukraine conflict impact
6.1. Exceptional items related to Russia-Ukraine conflict
The conflict between Russia and Ukraine has affected the Group’s business in those countries resulting
in significant non-recurring costs. More specifically, the Group has incurred significant net impairment
losses for property, plant and equipment, intangible assets and equity method investments in Russia.
These items have been presented in a separate line ‘Exceptional items related to Russia-Ukraine
conflict’ in the consolidated income statement, to provide users with enhanced visibility over these
items, considering their materiality. The exceptional items related to the Russia-Ukraine conflict for2022 can be summarised as follows:

Recoverability of individual assets in Russia1
Recoverability of the Russian cash-generating unit:
Goodwill
Property, plant and equipment
Recoverability of equity method investments
Exceptional items related to Russia-Ukraine conflict

Impairment losses€ million

Reversals of
impairment losses€ million

Net impairment
losses€ million

102.1(42.8)

59.3

13.7
15.0
52.8
183.6

–
(13.4)–(56.2)

13.7
1.6
52.8
127.4

1. References to Russia, Russian operation or Russian cash-generating unit in this Note relate to Multon Partners LLC (formerly LLC
Coca-Cola HBC Eurasia), the Group’s bottler in Russia.

a) Operations in Russia
Recoverability of individual assets in Russia
The Coca-Cola Company announced in March 2022 the suspension of its business in Russia, following
the Russia-Ukraine conflict. In response to this decision, the Group implemented a restructuring planin connection with its Russian operation and transitioned to a self-sufficient business model focusing
on local brands. This resulted in pre-tax impairment losses related to buildings, production andcold drink equipment of €102.1 million during the first half of 2022, that were recorded based ona value‑in‑use exercise, reported in line ‘Exceptional items related to Russia-Ukraine conflict’ of
the condensed consolidated interim income statement and included under Emerging markets
for segmental reporting purposes.
Following June 2022, whilst uncertainty levels remain high in Russia, the Group experienced more stable
market conditions and demand than initially anticipated. As a result, an updated value-in-use exercise
was performed for the Russian operation’s property, plant and equipment, which resulted in a partial
reversal of pre-tax impairment losses recognised during the first half of 2022, amounting to €42.8
million, considering also foreign currency translation impact. Net impairment losses amounted to €59.3
million for 2022, relating to buildings, production and cold drink equipment, which were reported in line
‘Exceptional items related to Russia-Ukraine conflict’ of the consolidated income statement andincluded under Emerging markets for segmental reporting purposes.
Following this, property, plant and equipment of the Russian operation, represented approximately 8%of the Group’s total property, plant and equipment as at 31 December 2022.

Recoverability of the Russian cash-generating unit
During the first half of 2022, the Group experienced worsening macroeconomic factors in Russia, as
sanctions and other regulations had an adverse impact in the country’s economic environment,
resulting in a material deterioration of the discount rate used to determine the recoverable amount of
the Group’s Russian cash-generating unit. The Group performed an interim impairment test of theRussian cash-generating unit’s recoverable amount, including goodwill, in June 2022 as part of its
condensed consolidated interim financial statements. As part of that exercise, the recoverable amount
was determined based on value-in-use calculations consistent with those performed under the 2021
annual impairment test methodology, updated to consider management’s revised best estimates ofcash flow forecasts and a higher discount rate, reflective of the macroeconomic uncertainty in Russia.
This exercise resulted in pre-tax impairment losses for goodwill and property, plant and equipment of€13.7 million and €15.0 million respectively, which were recorded in line ‘Exceptional items related to
Russia-Ukraine conflict’ of the condensed consolidated interim income statement and included under
Emerging markets for segmental reporting purposes.
Considering the relevant uncertainty in connection with its new business model in Russia and volatility inthe market, the Group updated the impairment test of its Russian cash-generating unit’s recoverable
amount based on value-in-use calculations consistent with its 2022 annual impairment test
methodology (refer to Note 14), using management’s updated best estimates of cash flow forecasts
taking into account the actual performance of the new business in the year and relevant market
developments as described above. The recoverable amount of the Russian cash-generating unit
resulting from this exercise amounted to approximately €1.1 billion as at 31 December 2022. In thecontext of this exercise, it was identified that the recoverable amount exceeded the carrying amount of
the Russian cash-generating unit, resulting in the reversal of €13.4 million of pre-tax impairment losses
of property, plant and equipment recognised in June 2022, considering also foreign currency translation
impact. The reversal of the impairment charge was accordingly recorded in line ‘Exceptional items
related to Russia-Ukraine conflict’ in the consolidated income statement and included under Emerging
markets for segmental reporting purposes.
The following table sets out the key assumptions used in the impairment assessment of the Russian
cash-generating unit for 2022 and 2021, as well as 2022 interim results:
Growth rate in perpetuity
Post-tax discount rate

2022

2022 interim

2021

4.0%
14.9%

4.0%
26.5%

3.0%
6.5%

Growth rate in perpetuity is in line with management’s expectation regarding industry growthin the country.
The Group applied post-tax discount rates to post-tax cash flows, as the valuation calculated using thismethod closely approximates to applying pre-tax discount rates to pre-tax cash flows. Relevant pre-tax
discount rates are presented below:
Pre-tax discount rate

2022

2022 interim

2021

18.3%

29.2%

7.7%

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
6. Russia-Ukraine conflict impact continued
The increase in discount rate used in the 2022 interim results compared to 2021, was mainly driven byhigher bond yield spreads due to fears of potential default of Russia’s debt, on the back of the imposed
sanctions, which subsided in the second half of the year, thus resulting in a lower discount rate for 2022
compared to the first half of the year; however, still higher than 2021.
Recoverability of equity method investments
The impact of the Russia-Ukraine conflict on the macroeconomic environment of Russia as describedabove, was also considered an impairment indicator by the Group under IAS 36 ‘Impairment of assets’,in connection with its integral, joint venture investment in Multon A.O. group of companies (‘Multon’).
Multon is engaged in the production and distribution of juices in Russia and was jointly controlled by theGroup and The Coca-Cola Company. The Group performed an interim impairment test in connection
with its investment in Multon in June 2022 as part of its condensed consolidated interim financial
statements. The recoverable amount of the investment was determined based on a fair value exercise,considering management’s best estimates of cash flow forecasts for a discrete period of five years.
Cash flows beyond the five-year period were extrapolated using the following estimated growthand discount rates:
2022 interim

Growth rate in perpetuity
Post-tax rate

4.0%
28.6%

The recoverable amount of the Group’s investment in Multon resulting from this exercise, which wasclassified as a Level 3 fair value measurement, amounted to €174.2 million. This resulted in a pre-tax
impairment loss of €52.8 million, which was recorded in line ‘Exceptional items related to Russia-Ukraine
conflict’ in the consolidated income statement and included under Emerging markets for segmental
reporting purposes.
In August 2022, The Coca-Cola Company unilaterally waived certain of its governance rights in connection
with its 50% interest in Multon. Following this waiver and considering the criteria set out in IFRS 10‘Consolidated financial statements’, the Group has concluded that it controls Multon and has been
accordingly consolidating its financial performance effective from 11 August 2022 (refer to Note 24).

b) Operations in Ukraine
As a result of the Russia-Ukraine conflict, operations of the Group’s Ukrainian subsidiary were
temporarily suspended for the period March-April 2022. During May 2022, the Group resumed
production and distribution of products in Ukraine, where safe to do so. Non-current assets of Ukraine
represented approximately 1% of the Group’s total non-current assets as at 31 December 2022.
An impairment test of the Ukrainian cash-generating unit, based on a value-in-use exercise consistent
with the Group’s annual impairment testing methodology was performed both for the purposes of theGroup’s condensed consolidated interim financial statements and consolidated financial statementsfor 2022, as it was considered that, whilst operations have resumed, significant changes in therelevant market with an adverse effect on the cash-generating unit had taken place during the period.
No impairment was identified as a result of this impairment testing. The Group’s carrying amount of
goodwill and other indefinite-lived intangibles for its Ukrainian cash-generating unit was €nil as at 31
December 2022 and 2021.

An amount of €4.4 million losses directly attributable to the Russia-Ukraine conflict, primarily related
to inventory and property, plant and equipment write-offs, have been incurred by the Group’s Ukrainian
subsidiary during 2022, of which €3.3 million have been recorded in line ‘Operating expenses (excluding
exceptional items related to Russia-Ukraine conflict)’ and €1.1 million in line ‘Cost of goods sold’ of theconsolidated income statement.

6.2. Foreign-currency risk
The Group is exposed to the effect of foreign currency risk on future transactions, recognised
monetary assets and liabilities that are denominated in currencies other than the local entity’sfunctional currency, as well as net investments in foreign operations. The Group actively manages its
foreign currency risk as described in Note 25 ‘Financial risk management and financial instruments’.
The Russia-Ukraine conflict has, among other things, resulted in increased volatility in currency markets,
especially in connection with the Russian Rouble.
The following tables present details of the Group’s sensitivity to reasonably possible increases anddecreases in the Euro and US Dollar against the Russian Rouble and Ukrainian Hryvnia. In determining
reasonably possible changes, the historical volatility over a 12-month period of the respective foreign
currencies in relation to the Euro and US Dollar has been considered. The sensitivity analysis determines
the potential gains and losses in the income statement or equity arising from the Group’s foreignexchange positions as a result of the corresponding percentage increases and decreases in theGroup’s main foreign currencies relative to the Euro and the US Dollar. The sensitivity analysis includes
outstanding foreign-currency-denominated monetary items, external loans and loans between
operations within the Group where the denomination of the loan is in a currency other than thefunctional currency of the local entity.
2022 exchange risk sensitivity to reasonably possible changes in Euro against Russian Rouble
and Ukrainian Hryvnia% historicalvolatility over a
12-month period

Russian Rouble
Ukrainian Hryvnia

54.5%
12.5%

Euro strengthens
against local currency(Gain)/loss in(Gain)/loss
income statementin equity€ million€ million

(9.4)
2.9

(0.1)
–

Euro weakens against
local currency
Loss/(gain) in
Loss/(gain) in
income statement
equity€ million€ million

31.9
(3.8)

0.2
–

2022 exchange risk sensitivity to reasonably possible changes in US Dollar against Russian Rouble
and Ukrainian Hryvnia% historicalvolatility over a
12-month period

Russian Rouble
Ukrainian Hryvnia

53.0%
4.1%

US Dollar strengthens
against local currency(Gain)/loss in(Gain)/loss
income statementin equity€ million€ million(18.7)(0.1)––

US Dollar weakens against
local currency
Loss/(gain) in
Loss/(gain) in
income statement
equity€ million€ million

61.0
0.1

–
–

173

174

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
6. Russia-Ukraine conflict impact continued
6.3. Other topics
As a result of sanctions and other regulations implemented in 2022, there have been changes inrequired regulatory approvals, potentially impacting the transfer and usage of cash outside of Russia.
Cash and cash equivalents held by the Group’s operations in Russia (including Multon) amounted to€155.3 million equivalent in Russian Rouble, US Dollar and Euro as at 31 December 2022. The
aforementioned changes restrict the usage of cash held in Russia outside the country, however they
are not expected to have a material impact on the Group’s liquidity, as the cash and cash equivalents
held in Russia are expected to be used in the forthcoming financial periods primarily for working capital
purposes in the Russian operations.
The Group is continuously monitoring performance of its Russian and Ukrainian operations as well as
the developments in the region, to ensure timely actions and initiatives are undertaken to minimise
potential adverse impact for the Group.

7. Segmental analysis
The Group has essentially one business, being the production, sale and distribution of ready-to-drink,
primarily non-alcoholic, beverages. The Group operates in 29 countries, which are aggregated inreportable segments as follows:
Established markets
Austria, Cyprus, Greece, Italy,
Northern Ireland, the Republic of Irelandand Switzerland.
Developing markets
Croatia, Czech Republic, Estonia,
Hungary, Latvia, Lithuania, Poland,
Slovakia and Slovenia.
Emerging markets
Armenia, Belarus, Bosnia andHerzegovina, Bulgaria, Egypt, Moldova,
Montenegro, Nigeria, North Macedonia,
Romania, the Russian Federation,
Serbia (including the Republic of Kosovo)and Ukraine.

The Group’s operations in each of the three reportable segments have been aggregated on the basisof their similar economic characteristics, assessed by reference to their net sales revenue per unit caseas well as disposable income per capita, exposure to political and economic volatility, regulatoryenvironments, customers and distribution infrastructures. The accounting policies of the reportablesegments are the same as those adopted by the Group. The Group’s chief operating decision makeris its Executive Leadership Team, which evaluates performance and allocates resources based onvolume, net sales revenue and operating profit.

a) Volume and net sales revenue
The Group’s sales volume in million unit cases1 for the years ended 31 December was as follows:
Established
Developing
Emerging
Total volume

2022

2021

643.9
478.8
1,589.1
2,711.8

589.9
415.5
1,407.3
2,412.7

1. One unit case corresponds to approximately 5.678 litres or 24 servings, being a typically used measure of volume. For premium spirits
volume, one unit case also corresponds to 5.678 litres. For biscuits volume, one unit case corresponds to 1 kilogram. For coffee
volume, one unit case corresponds to 0.5 kilograms or 5.678 litres. Volume data is derived from unaudited operational data.

Net sales revenue per reportable segment for the years ended 31 December is presented in thegraphs below:
2022

2021

€9,198.4 million€7,168.4 million

Established
Developing
Emerging€2,974.1m€1,719.7m€4,504.6m

Established
Developing
Emerging€2,479.0m€1,365.6m€3,323.8m

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
7. Segmental analysis continuedb) Other income statement items

Sales or transfers between the Group’s segments are not material, nor are there any customers who
represent more than 10% of net sales revenue for the Group.

Year ended 31 December

In addition to non-alcoholic, ready-to-drink beverages and coffee (‘NARTD’), the Group sells anddistributes premium spirits. An analysis of volume and net sales revenue per product type for the years
ended 31 December is presented below:
Volume in million unit cases1:
NARTD
Premium spirits
Total volume

2022

2021

2,708.4
3.4
2,711.8

2,409.3
3.4
2,412.7

Net sales revenue in € million:
NARTD
Premium spirits
Total net sales revenue

8,956.0
242.4
9,198.4

6,944.5
223.9
7,168.4

1. One unit case corresponds to approximately 5.678 litres or 24 servings, being a typically used measure of volume. For premium
spirits volume, one unit case also corresponds to 5.678 litres. For biscuits volume, one unit case corresponds to 1 kilogram. For
coffee volume, one unit case corresponds to 0.5 kilograms or 5.678 litres. Volume data is derived from unaudited operational data.

Net sales revenue from external customers attributed to Switzerland (the Group’s country of domicile),
the Russian Federation, Italy and Nigeria was as follows for the years ended 31 December:

Switzerland
Russian Federation2
Italy
Nigeria
All countries other than Switzerland, the Russian Federation, Italy andNigeria
Total net sales revenue from external customers

2022€ million

2021€ million

426.7
1,103.2
1,096.1
989.4

354.3
953.3
901.6
702.0

5,583.0
9,198.4

4,257.2
7,168.4

2. Net sales revenue from external customers for 2022 includes Multon, the Group’s juice business in Russia, for the period from 11
August 2022 to 31 December 2022 (refer to Note 24).

2022
€ million

2021€ million

Operating profit:
Established
Developing
Emerging
Total operating profit

310.4
113.1
280.3
703.8

285.6
104.7
409.0
799.3

Finance costs:
Established
Developing
Emerging
Corporate³
Inter-segment finance cost
Total finance costs

10(15.6)(18.1)(55.0)(118.7)111.5(95.9)(17.7)(7.9)(15.0)(120.1)87.8(72.9)

10

2.4
1.0
19.0
102.3
(111.5)
13.2

1.2
0.5
9.7
81.7
(87.8)
5.3

11(75.7)(28.5)(80.5)(23.3)(208.0)(57.6)(10.6)(91.1)(28.1)(187.4)

2.5
415.6

3.2
547.5

Finance income:Established
Developing
Emerging
Corporate³
Inter-segment finance income
Total finance income
Income tax expense:
Established
Developing
Emerging
Corporate3
Total income tax expense
Reconciling items:
Share of results of non-integral equity method investments
Profit after tax

Note

16

3. Corporate refers to holding, finance and other non-operating subsidiaries of the Group.

175

176

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
7. Segmental analysis continued

8. Net sales revenue

Depreciation and impairment of property, plant and equipment and amortisation and impairmentof intangible assets included in the measure of operating profit are as follows:

Accounting policy

2022€ million

2021€ million(96.4)(57.8)(330.7)(92.1)(54.1)(190.1)15(484.9)(336.3)14(0.6)(14.5)(15.1)

(0.3)
(0.7)
(1.0)

Note

Depreciation and impairment of property, plant and equipment:
Established
Developing
Emerging
Total depreciation and impairment of property,
plant and equipment
Amortisation and impairment of intangible assets:
Developing
Emerging
Total amortisation and impairment of intangible assetsc) Other items
The balance of non-current assets1 attributed to Switzerland (the Group’s country of domicile), Egypt,
Italy and Nigeria was as follows for the years ended 31 December:

Switzerland
Egypt
Italy
Nigeria
All countries other than Switzerland, Egypt, Italy and Nigeria
Total non-current assets1

2022€ million

2021€ million

596.0
615.7
1,137.4
744.7
2,946.0
6,039.8

557.5–
1,082.3
642.1
2,984.8
5,266.7

1. Excluding other financial assets, deferred tax assets, pension plan assets and trade and loans receivable.

Expenditure on property, plant and equipment per reportable segment was as follows for the years
ended 31 December:

Established
Developing
Emerging2
Total expenditure on property, plant and equipment2022€ million

2021€ million

154.1
75.7
302.0
531.8

104.7
89.5
319.4
513.6

2. Expenditure on property, plant and equipment for 2022 includes €8.4 million (2021: €7.1 million) relating to repayment of borrowings
undertaken to finance the purchase of production equipment by the Group’s subsidiary in Nigeria, classified as ‘Repayment ofborrowings’ in the consolidated cash flow statement.

The Group essentially produces, sells and distributes ready-to-drink, primarily non-alcoholic,beverages. Under IFRS 15 ‘Revenue from contracts with customers’ the Group recognises revenue
when control of the products is transferred, being when the products are delivered to the customer.
Net sales revenue is measured at the fair value of the consideration received or receivable andis stated net of sales discounts and consideration paid to customers. These mainly take theform of promotional incentives and are amortised over the terms of the related contracts as adeduction in revenue.
The Group provides volume rebates to customers once the quantity of goods purchased during
the period exceeds a threshold specified in the contract. To estimate the variable consideration
for the expected future rebates the Group uses the most likely amount method and the amount isrecognised in net sales revenue only to the extent that it is highly probable that a significant reversal
in the amount of cumulative revenue recognised will not occur when the uncertainty associated withthe variable consideration is subsequently resolved.
A contract liability is recognised if a payment is received or a payment is due (whichever is earlier)from a customer before the Group transfers the related goods. Contract liabilities are recognised
as revenue when the Group performs under the contract (i.e., transfers control of the related goods
to the customer).
Net sales revenue includes excise and other duties where the Group acts as a principal but excludes
amounts collected by third parties such as value-added taxes as these are not included in thetransaction price. The Group assesses these taxes and duties on a jurisdiction-by-jurisdiction basis
to conclude on the appropriate accounting treatment.
Revenue recognised in 2022 that was included in the contract liability balance at the beginning of theyear amounted to €11.6 million (2021: €10.4 million). For contract liabilities as at 31 December 2022
and 2021, refer to Note 21.
For an analysis of net sales revenue per reportable segment, refer to Note 7.
For the contributions received from The Coca-Cola Company, which are offset against consideration
paid to customers, refer to Note 28.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
9. Operating expensesb) Employee costs
Employee costs for the years ended 31 December comprised:

Operating expenses for the year ended 31 December comprised:

Selling expenses
Delivery expenses
Administrative expenses
Restructuring expenses
Acquisition and integration costs (refer to Note 24)
Operating expenses (excluding exceptional items related to
Russia-Ukraine conflict)
Exceptional items related to Russia-Ukraine conflict (refer to Note 6)
Operating expenses

2022€ million

2021€ million

1,045.7
698.8
518.5
11.9
79.7

879.1
533.0
385.7
21.2
14.3

2,354.6
127.4
2,482.0

1,833.3–
1,833.3

Wages and salaries
Social security costs
Pension and other employee benefits
Termination benefits
Total employee costs

2021€ million

877.6
163.6
147.6
15.1
1,203.9

724.7
138.3
132.3
19.9
1,015.2

The average number of full-time equivalent employees in 2022 was 33,043 (2021: 26,787).
Employee costs for 2022 included in operating expenses and cost of goods sold amounted to €906.9
million and €297.0 million respectively (2021: €766.7 million and €248.5 million respectively).

c) Directors’ and senior management’s remuneration

In 2022, operating expenses included a net loss on disposals of non-current assets of €1.5 million(2021: €28.4 million net gain).

The total remuneration paid or accrued for Directors and the senior management team for the years
ended 31 December comprised:

For the contributions received from The Coca-Cola Company, which are offset against expenses forgeneral marketing programs, refer to Note 28.

a) Restructuring expenses
Accounting policy
Restructuring expenses are recorded in a separate line item within operating expenses and comprisecosts arising from significant changes in the way the Group conducts its business such as significant
supply chain infrastructure changes, outsourcing of activities and centralisation of processes.
Restructuring provisions are recognised only when the Group has a present constructive obligation,
which is when a detailed formal plan identifies the business or part of the business concerned, thelocation, function and number of employees affected, a detailed estimate of the associated costs,
and an appropriate timeline, as well as when the employees affected have been notified of the plan’s
main features.
As part of the effort to optimise its cost base and sustain competitiveness in the marketplace, theCompany undertakes restructuring initiatives. The restructuring expenses consist mainly of employees’
termination benefits. Restructuring expenses per reportable segment for the years ended 31
December are presented below:

Established
Developing
Emerging
Total restructuring expenses

2022€ million

2022€ million

2021€ million

(6.1)
(1.5)
19.5
11.9

14.7
3.4
3.1
21.2

Salaries and other short-term benefits
Performance share awards
Pension and post-employment benefits
Total remuneration

2022€ million

2021€ million

19.3
8.0
1.0
28.3

16.3
6.4
0.9
23.6

d) Auditor fees
Audit and other fees charged in the income statement concerning the auditor of the consolidated
financial statements, PricewaterhouseCoopers S.A. and affiliates, were as follows, for the years ended
31 December:

Audit fees
Audit-related fees
Total audit and audit-related fees2022
€ million

2021€ million

5.1
1.1
6.2

4.8
0.7
5.5

Fees for audit services to firms other than PricewaterhouseCoopers S.A. and affiliates were €0.7 million
for the year ended 31 December 2022 (2021: €nil).

177

178

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
10. Finance costs, net
Accounting policy
Interest income and interest expense are recognised using the effective interest rate method,
and are recorded in the income statement within ‘Finance income’ and ‘Finance cost’ respectively.
Interest expense includes finance charges with respect to leases, amortisation of the loss on theforward starting swaps and the net impact from swaptions recorded in other comprehensive income(refer to Note 25).
Finance costs, net for the years ended 31 December comprised:

Finance income
Interest expense
Other finance costs
Net foreign exchange remeasurement losses
Finance costs
Finance costs, net

2022€ million

2021€ million

13.2(77.8)(2.1)(16.0)(95.9)(82.7)

5.3(67.1)(1.7)(4.1)(72.9)(67.6)

Finance income for 2022 and 2021 relates to interest income. Other finance costs include commitment
fees on loan facilities (for the part not yet drawn down) and other similar fees.
For the interest expense incurred with respect to leases, refer to Note 17.

11. Taxation
Accounting policy
Tax is recognised in the income statement, except to the extent that it relates to items recognisedin other comprehensive income or in equity. In this case, the tax is recognised in othercomprehensive income or directly in equity.
The current income tax expense is calculated on the basis of the tax laws enacted or substantively
enacted at the balance sheet date in the countries where the Group operates and generates taxable
income. Management periodically evaluates positions taken in tax returns with respect to situations
in which applicable tax regulations are subject to interpretation and establishes provisions whereappropriate, on the basis of amounts expected to be paid to the tax authorities.

Deferred tax is provided using the liability method for all temporary differences arising between thetax bases of assets and liabilities and their carrying values for financial reporting purposes. However,the deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill.
Deferred tax is not accounted for if it arises from initial recognition of an asset or liability in atransaction other than a business combination that at the time of the transaction affects neither
accounting nor taxable profit or loss. Tax rates enacted or substantively enacted at the balance
sheet date are those that are expected to apply when the deferred tax asset is realised or deferred
tax liability is settled.
Deferred tax assets are recognised to the extent that it is probable that future taxable profit will beavailable against which the temporary differences can be utilised. Deferred tax assets are recognised
for tax losses carried forward to the extent that realisation of the related tax benefit through the
reduction of the future taxes is probable.
Deferred tax is provided on temporary differences arising on investments in subsidiaries, associates
and joint ventures, except where the timing of the reversal of the temporary difference can becontrolled by the Group, and it is probable that the temporary difference will not reverse in theforeseeable future. This includes taxation in respect of the retained earnings of overseas
subsidiaries only to the extent that, at the balance sheet date, dividends have been accrued asreceivable or a binding agreement to distribute past earnings in future periods has been entered intoby the subsidiary.
Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to offset
current tax assets against current income tax liabilities and the deferred taxes relate to the same
taxation authority on either the same taxable entity or different taxable entities where there is anintention to settle the balances on a net basis.
The income tax charge for the years ended 31 December was as follows:

Current tax expense
Deferred tax (income) / expense
Income tax expense2022€ million

2021€ million

235.6(27.6)
208.0

183.5
3.9
187.4

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
11. Taxation continued

The income tax provision per reportable segment for the years ended 31 December was as follows:

The tax on the Group’s profit before tax differs from the theoretical amount that would arise using theweighted average tax rate applicable to profits of the consolidated entities as follows:2022€ million

2021€ million

Profit before tax

623.6

734.9

Tax calculated at domestic tax rates applicable to profits in therespective countries
Additional local taxes in foreign jurisdictions
Tax holidays in foreign jurisdictions
Expenses non-deductible for tax purposes
Income not subject to tax
Changes in tax laws and rates
Movement of accumulated tax losses
Movement of deferred tax asset not recognised
Other
Income tax expense

162.1
18.8
(0.2)
28.6
(3.6)
0.4
2.9
0.1
(1.1)
208.0

155.7
13.0
(5.8)
17.5
(2.5)
3.1
3.2
(0.6)
3.8
187.4

Non-deductible expenses for tax purposes include marketing and advertising expenses, service fees,
loss allowances on trade receivables, entertainment expenses, certain employee benefits and otheritems that, partially or in full, are not deductible for tax purposes in certain of the Group’s jurisdictions.
The Group is subject to income taxes in numerous jurisdictions. There are many transactions andcalculations for which the ultimate tax determination cannot be assessed with certainty in the ordinary
course of business. The Group recognises a provision for potential cases that might arise in theforeseeable future based on assessment of the probabilities as to whether additional taxes will be due.
Where the final tax outcome on these matters is different from the amounts that were initially recorded,
such differences will impact the income tax provision in the period in which such determination is
made, however, based on past experience, management expects that any such differences in thenext financial year will be immaterial for the Group. The income tax provision amounted to €67.5
million as at 31 December 2022 (2021: €52.6 million), of which €67.2 million (2021: €52.6 million) areclassified in line ‘Current tax liabilities’ and €0.3 million (2021: €nil) in line ‘Current tax assets’ of theconsolidated balance sheet.

Established
Developing
Emerging
Corporate1
Total income tax provision

2022€ million

2021€ million

18.2
14.3
25.4
9.6
67.5

16.8
4.9
21.5
9.4
52.6

1. Corporate refers to holding, finance and other non-operating subsidiaries of the Group.

Deferred tax assets and liabilities presented in the consolidated balance sheet as at 31 December canbe further analysed as follows:
Deferred tax assets:
To be recovered after 12 months
To be recovered within 12 months
Gross deferred tax assets
Offset of deferred tax
Net deferred tax assets
Deferred tax liabilities:
To be recovered after 12 months
To be recovered within 12 months
Gross deferred tax liabilities
Offset of deferred tax
Net deferred tax liabilities

2022€ million

2021€ million

62.6
73.7
136.3
(98.8)
37.5

32.9
71.5
104.4
(73.4)
31.0(339.6)(23.8)(363.4)98.8(264.6)(255.0)(16.1)(271.1)
73.4(197.7)2022€ million

2021€ million(166.7)27.6(128.1)
(2.1)
9.9
32.3
(227.1)(147.4)(3.9)–(15.6)
4.1(3.9)(166.7)

A reconciliation of net deferred tax is presented below:

As at 1 January
Taken to the income statement
Arising from business combinations (refer to Note 24)
Taken to other comprehensive income
Taken directly to equity
Foreign currency translation
As at 31 December

179

180

Strategic
ReportFinancial
Statements

Corporate
Governance

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
11. Taxation continued
The movements in deferred tax assets and liabilities during the year, without taking into consideration
the offsetting of balances within the same tax jurisdiction where applicable, are as follows:

Deferred tax assets
As at 1 January 2021
Taken to the income
statement
Taken to othercomprehensive income
Transfers between
assets/liabilities
Foreign currency translation
As at 31 December 2021
Taken to the income
statement
Arising from businesscombinations (refer to Note 24)
Taken to othercomprehensive income
Transfers between
assets/liabilities
Foreign currency translation
As at 31 December 2022

Provisions€ million

Pensions
Book inand benefit
Tax losses excess of tax
plans carry-forward depreciation€ million€ million€ million

Leasing€ million

Other
deferred tax
assets€ million

Total€ million

28.4

16.1

1.9

5.7

26.5

23.6

102.2

4.4

(5.5)

(0.1)

(0.6)

(2.8)

7.4

2.8

–

0.6

–

–

–

(0.5)

0.1

–
0.7
33.5

–
0.1
11.3

–
–
1.8

(1.7)
–
3.4

–
0.1
23.8

–
0.1
30.6

(1.7)
1.0
104.4

7.8

1.5

10.0

2.5

6.6

6.8

35.2

0.1

–

–

–

0.5

10.6

11.2

–

(2.0)

–

–

–

0.7

(1.3)

–
(0.6)
40.8

0.1
(0.1)
10.8

–
(5.2)
6.6

–
(0.4)
5.5

–
(0.3)
30.6

(5.1)
(1.6)
42.0

(5.0)
(8.2)
136.3

Other
Derivative deferred tax
instruments
liabilities€ million€ million

Total€ million

Deferred tax liabilities
As at 1 January 2021
Taken to the income statement
Taken to other comprehensive income
Taken directly to equity
Transfers between assets/liabilities
Foreign currency translation
As at 31 December 2021
Taken to the income statement
Arising from business combinations (refer to Note 24)
Taken to other comprehensive income
Taken directly to equity
Transfers between assets/liabilities
Foreign currency translation
As at 31 December 2022

Tax in excess
of book
depreciation€ million(232.8)(14.5)
–
–
1.7
(3.8)
(249.4)19.8(137.7)–––34.5(332.8)

(1.4)
2.1
(9.0)
4.1
–
–
(4.2)
(3.3)
(0.7)
(4.6)
9.9
–
(0.1)
(3.0)

(15.4)
5.7
(6.7)
–
–
(1.1)
(17.5)(24.1)
(0.9)
3.8
–
5.0
6.1
(27.6)(249.6)(6.7)(15.7)
4.1
1.7
(4.9)
(271.1)(7.6)(139.3)
(0.8)
9.9
5.0
40.5
(363.4)

Deferred tax assets recognised for tax losses carry-forward in accordance with the relevant local rules
applying in the Group’s jurisdictions can be analysed as follows:

Attributable to tax losses that expire within five years
Attributable to tax losses that can be carried forward indefinitely
Recognised deferred tax assets attributable to tax losses

2022€ million

2021€ million

2.1
4.5
6.6

0.5
1.3
1.8

The Group has unrecognised deferred tax assets attributable to tax losses that are available to carryforward against future taxable income of €29.1 million (2021: €28.1 million). These are analysed as follows:

Attributable to tax losses that expire within five years
Attributable to tax losses that expire after five years
Unrecognised deferred tax assets attributable to tax losses

2022€ million

2021€ million

18.7
10.4
29.1

19.5
8.6
28.1

The aggregate amount of distributable reserves arising from the realised earnings of the Group’s
operations was €3,574.8 million in 2022 (2021: €3,111.0 million). No deferred tax liabilities have beenrecognised on such reserves given that their distribution is controlled by the Group or, in the event ofplans to remit overseas earnings of subsidiaries, such distribution would not give rise to a tax liability.

12. Earnings per share
Accounting policy
Basic earnings per share is calculated by dividing the net profit attributable to the owners of theparent by the weighted average number of ordinary shares outstanding during the year. The
weighted average number of ordinary shares outstanding during the year is the number of ordinary
shares outstanding at the beginning of the year, adjusted by the number of ordinary shares boughtback or issued during the year multiplied by a time-weighting factor. Diluted earnings per shareincorporates stock options for which the average share price for the year is in excess of the exercise
price of the stock option and which create a dilutive effect.
The calculation of the basic and diluted earnings per share attributable to the owners of the parent
entity is based on the following data:
Net profit attributable to the owners of the parent (€ million)
Weighted average number of ordinary shares for the purposesof basic earnings per share (million)
Effect of dilutive stock options on number of shares (million)
Weighted average number of ordinary shares for the purposesof diluted earnings per share (million)
Basic earnings per share (€)
Diluted earnings per share (€)

2022

2021

415.4

547.2

366.4
0.5

365.0
1.3

366.9
1.13
1.13

366.3
1.50
1.49

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
13. Components of other comprehensive income
The components of other comprehensive income for the years ended 31 December comprise:

Cost of hedging (refer to Note 25)
Cash flow hedges (refer to Note 25)
Foreign currency translation(losses)/gains
Valuation loss on equity investments
at fair value through othercomprehensive income
Actuarial gains
Share of other comprehensive incomeof equity method investments
Reclassification of share of othercomprehensive income of equity
method investments to the income
statement, arising from businesscombination (refer to Note 24)
Other comprehensive (loss) / income

Before tax€ million

2022
Income tax€ million

Net of tax€ million

Before tax€ million

2021
Income tax€ million

Net of tax€ million

(3.5)
34.6

–
(3.9)

(3.5)
30.7

(2.7)
69.5

–
(9.5)

(2.7)
60.0

(252.6)–(252.6)

73.6

–

73.6

(0.1)
26.0

–
1.8

(0.1)
27.8

–
16.1

–
(6.1)

–
10.0

34.2

–

34.2

14.6

–

14.6

145.2
(16.2)

–
(2.1)

145.2
(18.3)–
171.1–(15.6)–
155.5

The foreign currency translation losses for 2022 primarily related to the Egyptian Pound and the Russian
Rouble, while the gains from the foreign currency translation for 2021 primarily related to the Russian
Rouble and the Swiss Franc.

14. Intangible assets
Accounting policy
Intangible assets consist of goodwill, franchise agreements, trademarks and water rights. Goodwill
and other indefinite-lived intangible assets are carried at cost less accumulated impairment losses,
while intangible assets with finite lives are amortised over their useful economic lives. The useful
lives, both finite and indefinite, assigned to intangible assets are evaluated on an annual basis.
Intangible assets with indefinite lives (‘not subject to amortisation’)
Intangible assets not subject to amortisation consist of goodwill, franchise agreements and trademarks.
Goodwill is the excess of the consideration transferred over the fair value of the share of net assets
acquired. Goodwill and fair value adjustments arising on the acquisition of subsidiaries are treatedas the assets and liabilities of those subsidiaries. These balances are denominated in the functional
currency of the subsidiary and are translated to Euro on a basis consistent with the other assets
and liabilities of the subsidiary.

The useful life of franchise agreements is usually based on the term of the respective franchise
agreements. The Coca-Cola Company does not grant perpetual franchise rights outside the UnitedStates. However, given the Group’s strategic relationship with The Coca-Cola Company and consistent
with past experience, the Group believes that franchise agreements will continue to be renewedat each expiration date with no significant costs. The Group has concluded that the franchise
agreements are perpetual in nature and they have therefore been assigned indefinite useful lives.
The Group’s trademarks are assigned an indefinite useful life when they have an established sales
history in the applicable region, it is the intention of the Group to receive a benefit from them
indefinitely and there is no indication that this will not be the case.
Goodwill and other indefinite-lived intangible assets are tested for impairment annually andwhenever there is an indication of impairment.
For the purpose of impairment testing, goodwill is allocated to each of the Group’s cash-generating
units expected to benefit from the business combination in which the goodwill arose. Other
indefinite-lived intangible assets are also allocated to the Group’s cash-generating units expected
to benefit from those intangibles. The cash-generating units (‘unit’) to which goodwill and otherindefinite-lived intangible assets have been allocated are tested for impairment annually, or more
frequently when there is an indication that the unit may be impaired. If the recoverable amount(i.e. the higher of the value-in-use and fair value less costs to sell) of the cash-generating unit is lessthan the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying
amount of any goodwill allocated to the unit and then pro-rata to the other assets of the unit on thebasis of the carrying amount of each asset in the unit. Impairment losses recognised against goodwill
are not reversed in subsequent periods.
Intangible assets with finite lives
Intangible assets with finite lives mainly consist of water rights and certain brands, are amortisedover their useful economic lives and are carried at cost less accumulated amortisation andimpairment losses. Intangible assets with finite lives are reviewed for impairment whenever
events or changes in circumstances indicate that the carrying amount may not be recoverable.
Critical accounting estimates
Determining whether goodwill or indefinite-lived intangible assets are impaired requires anestimation of the value-in-use of the cash-generating units to which they have been allocatedin order to determine the recoverable amount of the cash-generating units. The value-in-use
calculation requires the Group to estimate the future cash flows expected to arise from the
cash-generating unit, discounted at an appropriate rate. Estimating the discounted future cash
flows involves a significant degree of uncertainty. The value-in-use estimation is sensitive to thediscount rate used as well as the perpetuity growth rate used for extrapolation purposes. The key
assumptions used to determine the recoverable amount for the different cash-generating units,
including a sensitivity analysis where possible changes to these key assumptions could eliminate theremaining headroom, are disclosed and further explained below under ‘Annual impairment test for
goodwill and other indefinite-lived intangible assets’ section.

181

182

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
14. Intangible assets continued

Intangible assets not subject to amortisation amounted to €2,529.7 million (2021: €2,028.9 million),and are presented in the charts below:

The movements in intangible assets by classes of assets during the year are as follows:

Cost
As at 1 January 2021
Additions (refer to Note 16)
Arising from business combinations
Foreign currency translation
As at 31 December 2021
Amortisation
As at 1 January 2021
Charge for the year
As at 31 December 2021
Net book value as at 1 January 2021
Net book value as at 31 December 2021
Cost
As at 1 January 2022
Arising from business combinations (refer
to Note 24)
Impairment (refer to Note 6)
Foreign currency translation
As at 31 December 2022
Amortisation
As at 1 January 2022
Charge for the year
As at 31 December 2022
Net book value as at 1 January 2022
Net book value as at 31 December 2022

Trademarks€ million

Other
intangible
assets€ million

Total€ million

144.8
–
–
–
144.8

137.3
–
–
–
137.3

14.8
–
3.1
–
17.9

2,183.5
16.4
4.1
37.7
2,241.7

182.4
–
182.4
1,704.2
1,759.3

–
–
–
144.8
144.8

7.2
0.4
7.6
130.1
129.7

7.8
0.6
8.4
7.0
9.5

197.4
1.0
198.4
1,986.1
2,043.3

1,941.7

144.8

137.3

17.9

2,241.7

220.1(13.7)(39.7)
2,108.4

367.7–(116.7)
395.8

83.4
–
(0.5)
220.2

–
–
–
17.9

671.2
(13.7)(156.9)2,742.3

182.4
–
182.4
1,759.3
1,926.0

–
–
–
144.8
395.8

7.6
0.5
8.1
129.7
212.1

8.4
0.9
9.3
9.5
8.6

198.4
1.4
199.8
2,043.3
2,542.5

Goodwill€ million

Franchiseagreements€ million

1,886.6
16.4
1.0
37.7
1,941.7

Additions of goodwill in 2021 were attributable to the demerger of the Group’s mineral water and adultsparkling beverages integral joint venture in Italy as well as the formation of a joint operation in Romania,
amounting to €15.6 million and €0.8 million respectively (refer to Note 16).
Goodwill and other intangible assets of €1.0 million and €3.1 million respectively, arising from businesscombinations in 2021, related to the acquisition by the Group of a self-serve coffee-vending businessin its developing markets segment (the ’Costa Express Business’), which was integrated into theGroup’s operations.
Impairment losses of €13.7 million relate to the impairment of goodwill of the Group’s Russian
cash‑generating unit recognised as part of 2022 interim results (refer to Note 6).

2022

2021

€2,529.7 million€2,028.9 million

Goodwill
Franchise agreements
Trademarks€1,926.0 million€395.8 million€207.9 million

Goodwill
Franchise agreements
Trademarks€1,759.3 million€144.8 million€124.8 million

The carrying value of intangible assets subject to amortisation amounted to €12.8 million (2021:€14.4 million) and comprised water rights of €6.0 million, trademarks of €4.2 million and other intangible
assets of €2.6 million (2021: €6.4 million water rights, €4.9 million trademarks and €3.1 million otherintangible assets).

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
14. Intangible assets continued
Annual impairment test for goodwill and other indefinite-lived intangible assets
The recoverable amount of each cash-generating unit was determined through a value-in-use
calculation. This calculation uses cash flow forecasts based on financial budgets approved by the Boardof Directors covering a one-year period and cash flow forecasts for four additional years. Cash flows foryears two to five are forecasted by management based on operation and market-specific assumptions
including growth rates, forecast selling prices, direct costs and operating expenses. Management
determined gross margins based on past performance, expectations for the development of themarket and expectations about raw material costs. Cash flows for the subsequent years after theforecast period are extrapolated using perpetuity growth rates which reflect management’s best
estimate of industry growth, considering long-term inflation and gross domestic product forecasts
specific to the countries of operation. The discount rates used by management represent the current
market assessment of the risks specific to each cash-generating unit, taking into consideration thetime value of money and are derived from the weighted average cost of capital. The Group applies
post-tax discount rates to post-tax cash flows as the valuation calculated using this method closely
approximates to applying pre-tax discount rates to pre-tax cash flows.
Management also considered the potential adverse impact to future cash flows arising from climatechange risk, under different scenarios. These scenarios included the increased capital expenditure
required to mitigate climate-related risks and focused on the impact from disruptions to production
and distribution due to extreme weather as well as the increased cost of water and carbon emissions.
The Group will continue to refine its approach on climate-related risks and opportunities in the impairment
assessment, as greater understanding of the potential impacts on the Group’s business is obtained.
No impairment of goodwill and other indefinite-lived assets was identified during the annual impairment
test of 2022, or that of 2021.

The following chart and accompanying table set forth the percentage and carrying value respectivelyof goodwill and other indefinite-lived intangible assets for those cash-generating units whose carrying
value is greater or equal to 9% of the total, as at 31 December 2022.
Intangible assets not subject toamortisation as at 31 December 2022
(%)

Italy
Switzerland
The Republic of Ireland
and Northern Ireland
Egypt
Koncern Bambi a.d. Požarevac
Other

Franchise
Goodwill agreements€ million€ million

Trademarks€ million

Total€ million

640.9
467.3

126.9
–

–
–

767.8
467.3

241.5
141.9

–
251.2

–
–

241.5
393.1

115.2

–

118.5

233.7

319.2
1,926.0

17.7
395.8

89.4
426.3
207.9 2,529.7

Growth rate in perpetuity Post-tax discount rate
(%)
(%)
2022
2021
2022
2021

Pre-tax discount rate
(%)
2022
2021

Italy
Switzerland
The Republicof Ireland andNorthern Ireland
Egypt
Koncern Bambi
a.d. Požarevac
All other cashgenerating units
Total

30%
18%
10%
16%
9%
17%

The key assumptions for these cash-generating units are presented below:

Egypt
Italy
Switzerland
The Republic of Ireland and Northern Ireland
Koncern Bambi a.d. Požarevac

5.0
2.0
0.8
4.0
4.5

–
1.5
0.9
4.0
4.5

15.2
8.6
6.7
6.6
10.9

–
6.5
5.7
5.6
6.6

17.8
11.4
8.0
7.1
11.9

–
8.7
6.7
6.0
6.9

For the cash-generating units of the Republic of Ireland and Northern Ireland and Koncern Bambi a.d.
Požarevac, the growth rate in perpetuity as estimated by management was higher than that expected
for the industry in general. This is attributable to the strength of the Group’s brand portfolio, which isamongst the strongest and broadest in the industry. The Group has historically achieved higher revenue
growth than the industry leveraging the strength of its portfolio, while it continually invests in brand-related
innovations to remain relevant, be able to cater to all consumption occasions and increase market share.

183

184

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
14. Intangible assets continued

15. Property, plant and equipment

Sensitivity analysis
In the cash-generating unit of Egypt, which as at 31 December 2022 held €141.9 million and €251.2
million of goodwill and franchise agreements respectively, reasonably possible changes in key
assumptions of the 2022 impairment test would remove the remaining headroom. As at 31 December
2022, the recoverable amount of the Egyptian cash-generating unit calculated based on value-in-use
exceeded its carrying value by €83.7 million; changes per key assumption that would eliminate
remaining headroom are summarised in the table below:

Egypt

Growth rate inperpetuity

Discount rate

170bps120bps

As at 31 December 2022, the recoverable amount of the Italian cash-generating unit calculated basedon value-in-use significantly exceeded its carrying value. As a result, the key assumptions of the Italian
cash-generating unit’s 2022 impairment test are not sensitive to possible changes that would eliminate
the remaining headroom.
The Group will continue to closely monitor these cash-generating units in order to ensure that timely
actions and initiatives are undertaken to minimise potential adverse impact on their expected performance.

Accounting policy
All property, plant and equipment is initially recorded at cost and subsequently measured at cost lessaccumulated depreciation and impairment losses. Subsequent expenditure is added to the carrying
value of the asset when it is probable that future economic benefits, in excess of the original assessed
standard of performance of the existing asset, will flow to the operation and the costs can bemeasured reliably. All other subsequent expenditure is expensed in the period in which it is incurred.
Assets under construction are recorded as part of property, plant and equipment and depreciationon these assets commences when the assets are made available for use.
Depreciation is calculated on a straight-line basis to allocate the depreciable amount over theestimated useful life of the assets as follows:
Freehold buildings and improvements
Leasehold buildings and improvements
Production equipment
VehiclesComputer hardware and software
Marketing equipment
Fixtures and fittings
Returnable containers

40 years
Over the lease term, up to 40 years
4 to 20 years
5 to 8 years
3 to 10 years
3 to 10 years
8 years
3 to 12 years

Freehold land is not depreciated as it is considered to have an indefinite life.
Deposits received for returnable containers by customers are accounted for as deposit liabilities(refer to Note 21).
Residual values and useful lives of assets are reviewed and adjusted if appropriate at each balance
sheet date.
Property, plant and equipment is reviewed for impairment whenever events or changes incircumstances indicate that the carrying amount may not be recoverable. An impairment loss
is recognised for the amount by which the carrying amount of the asset exceeds its recoverable
amount, which is the higher of the asset’s fair value less cost to sell and its value-in-use.
For the purposes of assessing impairment, assets are grouped at the lowest level of separately
identifiable cash flows.
For accounting policy regarding right-of-use assets, refer to Note 17 ‘Leases’.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
15. Property, plant and equipment continued
The movements of property, plant and equipment by class of assets are as follows:

Cost
As at 1 January 2021
Additions1
Arising from business combinations
Disposals
Reclassified to assets held for sale(refer to Note 20)
Reclassifications
Foreign currency translation
As at 31 December 2021
Depreciation and impairment
As at 1 January 2021
Charge for the year
Impairment
Disposals
Reclassified to assets held for sale(refer to Note 20)
Foreign currency translation
As at 31 December 2021
Net book value as at 31 December 2021
excluding right-of-use assets
Net book value of right-of-use assets
as at 31 December 2021
Net book value as at 31 December 2021

Land andbuildings€ million

Plant andequipment€ million

Returnablecontainers€ million

Assets underconstruction€ million

Total€ million

1,412.7
7.6
–
(9.2)

3,597.0
137.0
1.3(166.8)

420.7
40.9
–
(12.3)

199.8
297.1
–
(0.1)

5,630.2482.6
1.3(188.4)

–
90.8
28.1
1,530.0

(1.8)
247.7
76.2
3,890.6

–
–
1.6
450.9

–
(338.5)
0.8
159.1

(1.8)
–
106.7
6,030.6

498.6
42.9
1.0
(2.1)

2,440.8
206.5
4.0(165.4)

255.1
27.6
0.5
(9.7)

1.2
–
0.5
–

3,195.7277.0
6.0(177.2)

–
11.8
552.2

(1.7)
50.1
2,534.3

–
0.6
274.1

–
–
1.7

(1.7)
62.5
3,362.3

977.8

1,356.3

176.8

157.4

2,668.3

63.2
1,041.0

99.4
1,455.7

–
176.8

–
157.4

162.6
2,830.9

1. Additions line for 2021 includes €13.8 million on a net book value basis relating to the impact from the demerger of the Group’s
mineral water and adult sparkling beverages integral joint venture in Italy (refer to Note 16).

Cost
As at 1 January 2022
AdditionsArising from business combinations(refer to Note 24)
Disposals
Reclassified from right-of-use assets2
Reclassified to assets held for sale(refer to Note 20)
Reclassifications
Foreign currency translation
As at 31 December 2022
Depreciation and impairment
As at 1 January 2022
Charge for the year
Impairment
Disposals
Reclassified from right-of-use assets2
Reclassified to assets held for sale(refer to Note 20)
Foreign currency translation
As at 31 December 2022
Net book value as at 31 December 2022
excluding right-of-use assets
Net book value of right-of-use assets as
at 31 December 2022
Net book value as at 31 December 2022

Land andbuildings€ million

Plant andequipment€ million

Returnablecontainers€ million

Assets underconstruction€ million

Total€ million

1,530.0
4.1

3,890.6
143.6

450.9
59.8

159.1
373.2

6,030.6
580.7

198.5
(5.7)
4.2

125.9
(141.7)
12.1

4.5(10.8)
–

13.5
(1.2)
–

342.4
(159.4)
16.3

–
84.5
(63.3)
1,752.3

(0.6)
205.2
(66.7)
4,168.4

–
–
(7.4)
497.0

–
(289.7)
(5.8)
249.1

(0.6)
–
(143.2)
6,666.8

552.2
49.9
19.0
(4.5)
1.5

2,534.3
252.4
61.0(134.0)
2.3

274.1
38.9
0.7
(6.6)
–

1.7
–
0.8
(0.2)
–

3,362.3
341.2
81.5(145.3)
3.8

–
(5.2)
612.9

(0.5)
(30.2)
2,685.3

–
(3.2)
303.9

–
–
2.3

(0.5)
(38.6)
3,604.4

1,139.4

1,483.1

193.1

246.8

3,062.4

82.7
1,222.1

121.2
1,604.3

–
193.1

–
246.8

203.9
3,266.3

2. Line ‘Reclassified from right-of-use assets’ for 2022 relates to the reclassification from right-of-use assets to land and buildings
and plant and equipment of €12.5 million on a net book value basis, following the exercise of purchase options included in thelease contracts.

Assets under construction at 31 December 2022 include advances for equipment purchases of €63.2
million (2021: €41.8 million). The depreciation charge for the year, including that for right-of-use assets(refer to Note 17), recognised in operating expenses and cost of goods sold amounted to €209.6 million(2021: €181.4 million) and €193.8 million (2021: €148.9 million) respectively.

185

186

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
15. Property, plant and equipment continued

Country of registration

Impairment of property, plant and equipment
In 2021 the Group recorded impairment losses of €3.7 million, €0.9 million and €3.8 million and reversalsof impairment of €0.2 million, €0.3 million and €1.9 million relating to property, plant and equipment in
the Established, Developing and Emerging segments respectively. The impaired assets, being mainly
buildings and production equipment, were written down based mainly on value-in-use calculations.
In 2022 the Group recorded impairment losses of €1.6 million, €0.9 million and €81.4 million and reversalsof impairment of €0.6 million, €0.2 million and €1.6 million relating to property, plant and equipment in
the Established, Developing and Emerging segments respectively. Net impairment losses of €60.9 million,
relating to property, plant and equipment in the Emerging segment are included in the exceptional
items related to Russia-Ukraine conflict (refer to Note 6). The impaired assets, being mainly buildings,
production and cold-drink equipment, were written down based mainly on value-in-use calculations.

16. Interests in other entities
List of principal subsidiaries
The following are the principal subsidiaries of the Group as at 31 December:Country of registration

Adelink Ltd1AS Coca-Cola HBC Eesti
CCB Management Services GmbH
CCHBC Armenia CJSC
CCHBC Bulgaria AD
CCHBC IT Services Limited
CCHBC Reinsurance DesignatedActivity Company
CCH CirculaRPET S.r.l.
Coca-Cola HBC Austria GmbH
Coca-Cola Beverages Belorussiya
Coca-Cola Beverages Ukraine Ltd
Coca-Cola Imbuteliere Chisinau SRL
Coca-Cola HBC B-H d.o.o. Sarajevo
Coca-Cola HBC Česko a Slovensko, s.r.o.
Coca-Cola HBC Česká a Slovensko, s.r.o.
– organizačná zložka
CC Beverages Holdings II B.V.
Coca-Cola Bottling Companyof Egypt (S.A.E.)2
Coca-Cola HBC Cyprus Ltd
Coca-Cola HBC Finance B.V.

% of voting rights
2022
2021

% ownership
2022
2021

CyprusEstonia
Austria
Armenia
Bulgaria
Bulgaria

50.0%
100.0%
100.0%
100.0%
99.4%
100.0%

50.0% 50.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
99.4% 99.4%
100.0% 100.0%

50.0%
100.0%
100.0%
100.0%
99.4%
100.0%

Republic of Ireland
Italy
Austria
Belarus
UkraineMoldova
Bosnia andHerzegovina
Czech Republic

100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%

100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Slovakia
The Netherlands

100.0% 100.0% 100.0% 100.0%
100.0% 100.0% 100.0% 100.0%

Egypt
CyprusThe Netherlands

94.7%– 94.7%–100.0% 100.0% 100.0% 100.0%
100.0% 100.0% 100.0% 100.0%

100.0% 100.0% 100.0% 100.0%
100.0% 100.0% 100.0% 100.0%

Coca-Cola HBC Greece S.A.I.C.
Coca-Cola HBC Holdings B.V.
Coca-Cola HBC Hrvatska d.o.o.
Coca-Cola HBC Hungary Ltd
Coca-Cola HBC Ireland Limited
Coca-Cola HBC Italia S.r.l.
Coca-Cola HBC Kosovo L.L.C.
Coca-Cola HBC Northern Ireland Limited
Coca-Cola HBC Polska sp. z o.o.
Coca-Cola HBC Romania Ltd
Coca-Cola HBC Services MEPE
Coca-Cola HBC Slovenija d.o.o.
Coca-Cola HBC Sourcing B.V.
Coca-Cola HBC Switzerland Ltd
Coca-Cola HBC-Srbija d.o.o.
Coca-Cola Hellenic BottlingCompany‑Crna Gora d.o.o., Podgorica
Coca-Cola Hellenic Business Service
Organisation
Coca-Cola Hellenic Procurement GmbHESM Effervescent Sodas Management
Limited3
Koncern Bambi a.d. Požarevac
Multon AO1Multon Partners LLC4
Nigerian Bottling Company Ltd
SIA Coca-Cola HBC Latvia
Three Cents Hellas Single Member S.A.3
UAB Coca-Cola HBC Lietuva% of voting rights
2022
2021

% ownership
2022
2021

GreeceThe Netherlands
Croatia
Hungary
Republic of Ireland
Italy
KosovoNorthern Ireland
PolandRomania
GreeceSlovenia
The Netherlands
Switzerland
Serbia100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
99.9%
100.0%

100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%
99.9% 99.9%
100.0% 100.0%

Montenegro

100.0% 100.0% 100.0% 100.0%

Bulgaria
Austria100.0% 100.0% 100.0% 100.0%
100.0% 100.0% 100.0% 100.0%

CyprusSerbiaRussiaRussiaNigeria
LatviaGreeceLithuania

100.0%
100.0%
50.0%
100.0%
100.0%
100.0%
100.0%
100.0%– 100.0%
100.0% 100.0%
50.0% 50.0%
100.0% 100.0%
100.0% 100.0%
100.0% 100.0%– 100.0%
100.0% 100.0%

100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
99.9%
100.0%–
100.0%
50.0%
100.0%
100.0%
100.0%–
100.0%

1. Following unilateral waiver by The Coca-Cola Company of certain of its governance rights, Coca-Cola HBC acquired controlof Multon AO Group of companies effective 11 August 2022 (refer to Note 24).
2. Coca-Cola Bottling Company of Egypt (S.A.E.) was acquired on 13 January 2022 (refer to Note 24).
3. ESM Effervescent Sodas Management Limited and its subsidiary Three Cents Hellas Single Member S.A. were acquired on
21 October 2022 (refer to Note 24).
4. LLC Coca-Cola HBC Eurasia was renamed to Multon Partners LLC as of 29 July 2022.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
16. Interests in other entities continued
Equity method investments
Accounting policies
Equity method investments comprise investments in associates and joint arrangements and areclassified into integral and non-integral on the basis of whether they are considered part of theGroup’s core operations and strategy.
Investments in associates
Investments in associated undertakings are accounted for by the equity method of accounting.
Associated undertakings are all entities over which the Group has significant influence but notcontrol, generally accompanying a shareholding of between 20% to 50% of the voting rights.
The equity method of accounting involves recognising the Group’s share of the associates’
post-acquisition profit or loss and movements in other comprehensive income for the period in theincome statement and other comprehensive income respectively. Unrealised gains and losses
resulting from transactions between the Group and the associate are eliminated to the extent of theinterest in the associate.
The Group’s interest in each associate is carried in the balance sheet at an amount that reflects its
share of the net assets of the associate and includes goodwill on acquisition. When the Group’s
share of losses in an associate equals or exceeds its interest in the associate, the Group does notrecognise further losses, unless the Group has incurred obligations or made payments on behalf of
the associate.
Investments in joint arrangements
Joint arrangements are arrangements in which the Group has contractually agreed sharing ofcontrol, which exists only when decisions about the relevant activities require unanimous consent.
Joint arrangements are classified as joint ventures or joint operations depending upon the rights andobligations arising from the joint arrangement.
The Group classifies a joint arrangement as a joint venture when the Group has rights to the net
assets of the arrangement. The Group accounts for its interests in joint ventures using the equity
method of accounting as described in the section above.
The Group classifies a joint arrangement as a joint operation when the Group has the rights to theassets, and obligations for the liabilities, of the arrangement and accounts for each of its assets,
liabilities, revenues and expenses, including its share of those held or incurred jointly, in relation to
the joint operation.
If facts and circumstances change, the Group reassesses whether it still has joint control andwhether the type of joint arrangement in which it is involved has changed.

Critical accounting judgements
The Group participates in several joint arrangements. Judgement is required in order to determine
their classification as a joint venture where the Group has rights to the net assets of thearrangement, or a joint operation where the Group has rights to the assets and obligations for theliabilities of the arrangement. In making this judgement, consideration is given to the legal form of
the arrangement, and the contractual terms and conditions, as well as other facts andcircumstances (including the economic rationale of the arrangement and the impact of the legal
framework).
Changes in the carrying amounts of equity method investments for 2021 and 2022 are as follows:

As at 1 January 2021
Additions
Decrease
Share of results of equity method investments
Share of other comprehensive income of equity
method investments
Share of total comprehensive income
Return of capital
Dividends
As at 31 December 2021
Impairment (refer to Note 6)
Gain on remeasurement of previously held equity
interest arising from business combination
Deemed disposal arising from business combination(refer to Note 24)
Capital increase
Share of results of equity method investments
Share of other comprehensive income of equity
method investments
Share of total comprehensive income
Dividends
As at 31 December 2022

Joint ventures€ million

Associates€ million

Total€ million

284.1–(34.6)
34.4

29.6
88.0
–
3.2

313.7
88.0
(34.6)
37.6

14.6
49.0
(6.1)
(45.5)
246.9(52.8)

–
3.2
–
(1.9)
118.9
–

14.6
52.2
(6.1)
(47.4)
365.8(52.8)

70.8

–

70.8

(249.9)
4.0
42.1

–
7.0
2.0

(249.9)
11.0
44.1

34.6
76.7
(9.7)
86.0

(0.4)
1.6
(7.9)
119.6

34.2
78.3
(17.6)
205.6

187

188

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
16. Interests in other entities continued
The carrying amount of equity method investments as at 31 December 2022 comprises integral andnon-integral equity method investments as follows:Integral equity method investments
Non-integral equity method investments
Total equity method investments

Joint ventures€ million

Associates€ million

Total€ million

81.9
4.1
86.0

–
119.6
119.6

81.9
123.7
205.6

a) Investments in joint ventures
In January 2021, a demerger of Acque Minerali S.r.l., our mineral water and adult sparkling beverages
integral joint venture with The Coca-Cola Company in Italy, was completed. As part of the demerger,
certain operating activities were transferred to the Group, resulting in the recognition of €15.6 millionof goodwill and €14.0 million of property, plant and equipment, including right-of-use assets, as partof the Group’s Italian cash-generating unit (refer to Note 14 and Note 15 respectively) and the decreaseof equity method investments by €34.6 million, presented in line ‘Decrease’ of the table on page 187
regarding 2021 changes in the carrying amounts of equity method investments. There was no significant
impact to the Group’s net assets or income statement from this transaction. Also, there was no cash
flow impact for the Group as a result of the transaction.
The Group has a 50% interest in Multon AO Group of companies (‘Multon’), which is engaged in the
production and distribution of juices in Russia and was jointly controlled by the Group and The Coa-Cola
Company. The joint arrangement was classified as a joint venture, as its structure provided the Group
with rights to its net assets. In March 2022, in response to the Russia-Ukraine conflict, The Coca-Cola
Company announced that it was suspending its business in Russia. In August 2022, The Coca-Cola
Company unilaterally waived certain of its governance rights in connection with its 50% interestin Multon, which were accordingly assumed by the Group, while retaining consent rights in respectof certain limited board and shareholder reserved matters that are protective in nature. As a result,considering the criteria set out in IFRS 10 ‘Consolidated financial statements’, the Group has concluded
that, effective 11 August 2022, it controls Multon (refer to Note 24).
As a result of the change in control of Multon described above, on 11 August 2022 the Groupremeasured the previously held equity interest in Multon at its fair value (refer to Note 24), which
resulted in a gain of €70.8 million, which was presented in line ‘Gain on remeasurement of previously
held equity interest arising from business combination’ of the table on page 187, regarding 2022 changes
in the carrying amount of equity method investments. The Group then proceeded to derecognise theresulting carrying amount of Multon investment of approximately €250 million, against the fair value ofthe identifiable net assets recognised (refer to Note 24), which was presented in line ‘Deemed disposalarising from business combination’ of the table on page 187 regarding 2022 changes in the carrying
amount of equity method investments.
Apart from Multon, the Group has a significant joint venture with Heineken, through its 50% interestin AD Pivara Skopje which is engaged in the bottling and distribution of soft drinks and beer in North
Macedonia. The structure of the joint venture provides the Group with rights to its net assets.

Summarised financial information of the Group’s significant joint ventures is presented below.
This information reflects the amounts presented in the IFRS financial statements of the joint venture,amended to reflect adjustments made when using the equity method, including fair value adjustments
and not the Group’s share in these amounts.
2021€ million

Multon A.O. Group of companies
Summarised balance sheet1:
Non-current loans to related parties
Other non-current assets
Non-current assets
Cash and cash equivalents
Current loans to related parties
Other current assets
Total current assets
Other current liabilities (including trade payables)
Total current liabilities
Total non-current liabilities
Net assets

Summarised statement of comprehensive income1:
Revenue
Depreciation
Interest income
Interest expense
Profit before tax
Income tax expense
Profit after tax
Other comprehensive income
Total comprehensive income
Dividends received and capital returns

5.1
137.9
143.0
9.0
54.1
131.5
194.6
(76.0)(76.0)
(7.4)
254.2
2022
€ million

2021€ million

307.3
(3.4)
6.6
(1.1)
80.5
(15.9)
64.6
69.8
134.4
–

417.0
(5.4)
7.7
(1.5)
65.0
(12.6)
52.4
29.0
81.4
34.8
2021
€ million

Reconciliation of net assets to carrying amount:
Closing net assets
Interest in joint venture at 50%
Goodwill
Carrying value

254.2
127.1
37.6
164.7

1. Further to the Group obtaining control over Multon, the latter’s balance sheet as at 31 December 2022 has been consolidated.
The summarised statement of comprehensive income presented for 2022 reflects the period up to 11 August 2022, during which
Multon was classified as a joint venture.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
16. Interests in other entities continued
AD Pivara Skopje
Summarised balance sheet:
Non-current assets
Cash and cash equivalents
Other current assets
Total current assets
Borrowings
Other current liabilities (including trade payables)
Total current liabilities
Borrowings
Other non-current liabilities
Total non-current liabilities
Net assetsb) Investments in associates
2022€ million

2021€ million

66.1
0.5
14.4
14.9
(3.6)
(20.8)(24.4)
(7.0)
(0.3)
(7.3)
49.3

56.7
0.2
13.6
13.8
(2.2)
(18.5)(20.7)
(0.1)
(0.6)
(0.7)
49.1

Summarised statement of comprehensive income:Revenue
Depreciation
Profit before tax
Income tax expense
Profit after tax
Total comprehensive income
Dividends received

91.8
(5.7)
17.9
(2.1)
15.8
15.8
7.7

79.3
(5.3)
17.2
(2.0)
15.2
15.2
13.0

Reconciliation of net assets to carrying amount:
Closing net assets
Interest in joint venture at 50%
Goodwill
Non-controlling interest
Carrying value

49.3
24.7
16.9
(1.6)
40.0

49.1
24.6
16.9
(1.6)
39.9

Summarised financial information of the Group’s investment in other joint ventures is as follows:

Carrying amount
Share of profit
Share of other comprehensive income
Share of total comprehensive income2022€ million

2021€ million

46.0
1.9
(0.3)
1.6

42.3
0.6
0.1
(0.7)

On 7 October 2021, the Group acquired a 30% equity shareholding in Casa Del Caffè Vergnano S.p.A.
(‘Caffè Vergnano’), a premium Italian coffee company. The Group also entered into an exclusive
distribution agreement for Caffè Vergnano’s products in all its territories outside of Italy. The
corresponding investment was classified as an associate in accordance with the requirements of IAS
28 ‘Investments in Associates and Joint Ventures’ since the terms of the transaction gave the Groupsignificant influence over the investee. The investment is accounted for using the equity method andwas further classified as a non-integral equity method investment in the consolidated financial
statements of the Group, considering that the distribution agreement was separate to theshareholding. The total consideration paid in 2021 amounted to €87.0 million, including acquisition
costs of €0.1 million. Total acquisition costs incurred in 2021 amounted to €1.1 million, out of which€0.8 million were paid in 2022. Consideration including acquisition costs paid was presented in line
‘Payments for non-integral equity method investments’ of the consolidated cash flow statement, in
2021 and 2022 accordingly. Total consideration and acquisition costs were presented in line ‘Additions‘of the table on page 187 regarding 2021 changes in the carrying amount of equity method investments.
The information below reflects the amounts presented in the financial statements of Caffè Vergnano
under Italian law, amended to reflect adjustments made by the Group when using the equity method,
including fair value adjustments and not the Group’s share in these amounts.
Caffè Vergnano
Summarised balance sheet:
Non-current assets
Cash and cash equivalents
Other current assets
Total current assets
Borrowings
Other current liabilities (including trade payables)
Total current liabilities
Borrowings
Other non-current liabilities
Total non-current liabilities
Net assets

2022€ million

2021€ million

125.2
1.0
54.5
55.5
(19.6)(30.6)(50.2)(2.4)(27.5)(29.9)
100.6

122.6
5.2
52.7
57.9
(16.2)(33.0)(49.2)(1.8)(28.1)(29.9)
101.4

189

190

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
16. Interests in other entities continued
Summarised statement of comprehensive income1:
Revenue
Depreciation(Loss) / profit before tax
Income tax(Loss) / profit after tax
Total comprehensive income
Reconciliation of net assets to carrying amount:
Closing net assets
Interest in associate at 30%
Acquisition costs
Goodwill
Carrying valuec) Joint operations
2022€ million

2021€ million

105.1
(7.6)
(3.6)
0.3
(3.3)
(3.3)

22.3
(1.7)
0.3
(0.3)
–
–

100.6
30.2
1.1
56.5
87.8

101.3
30.4
1.1
56.5
88.0

Other joint operations of the Group with The Coca-Cola Company comprise mainly a 50% interestin each of the water businesses listed below, which are engaged in the production and distributionof water in the respective countries.
Country

Joint operation

Country

Joint operation

Austria
Italy
Romania
Baltics

Römerquelle
Fonti del Vulture
Dorna
Neptuno Vandenys

PolandSwitzerland
SerbiaMultivita
ValserVlasinka

In addition, in April 2021 the Group acquired a 50% interest in Stockday S.R.L., an online business-tobusiness platform and distributor in Romania, which was up until that point wholly owned by Heineken
Romania S.A. The transaction resulted in the two shareholders jointly controlling Stockday S.R.L.
The joint arrangement was classified as a joint operation in accordance with the requirements of IFRS
11 ‘Joint arrangements‘, as it provides the shareholders with rights to the assets and obligations forthe liabilities of the joint arrangement. As a result of the above transaction, goodwill of €0.8 million wasrecognised as part of the Group’s Emerging segment (refer to Note 14).

1. Summarised statement of comprehensive income for 2021 relates to the period following acquisition of the associate.

17. Leases

Summarised financial information of the Group’s investment in other associates is as follows:

Carrying amount
Share of profit
Share of other comprehensive income
Share of total comprehensive income2022€ million

2021€ million

31.8
3.0
(0.4)
2.6

30.9
3.2
–
3.2

Frigoglass Industries (Nigeria) Limited, a non-integral associate in which the Group holds an effective
interest of 23.9% (2021: 23.9%) through its subsidiary Nigerian Bottling Company Ltd, is guarantor
under the amended banking facilities and notes issued by the Frigoglass Group, as part of the debt
restructuring of the latter. The Group has no direct exposure arising from this guarantee arrangement,
but the Group’s investment in this associate, which stood at €21.1 million as at 31 December 2022 (31December 2021: €25.2 million), would be at potential risk if there was a default under the terms of theamended banking facilities or the notes and the Frigoglass Group (including the guarantor) was unable
to meet its obligations thereunder.

Accounting policy
Leases for which the Group is in a lessee position are recognised as a right-of-use asset and acorresponding lease liability at the date at which the lease asset is available for use by the Group.
Assets and liabilities arising from a lease are initially measured on a net-present-value basis and arerecognised as part of ‘Property, plant and equipment’, ‘Current borrowings’ and ‘Non-current
borrowings’ in the consolidated balance sheet, respectively.
Lease contracts may contain both lease and non-lease components. The Group allocates theconsideration in the contract to the lease and non-lease components as appropriate. Consideration
relevant to the non-lease component is recognised as an expense in the consolidated income
statement over the period of the lease.
Lease liabilities include the net present value of the following lease payments:a) fixed payments (including in-substance fixed payments) over the lease term, less any lease
incentives receivable;b) variable lease payments that are based on an index or a rate;c) amounts expected to be payable by the lessee under residual value guarantees;d) the exercise price of a purchase option if the Group is reasonably certain it will exercise that
option; ande) payments of penalties for terminating the lease, if the lease term reflects the Group exercisingthat option.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
17. Leases continued
Accounting policy continued
When adjustments to lease payments based on an index or rate take effect, the lease liability isreassessed and adjusted against the right-of-use asset.
Variable lease payments that do not depend on an index or a rate are recognised as an expense in
the period in which the event or condition that triggers the payment occurs.
The lease payments are discounted using the interest rate implicit in the lease (if that rate can be
determined), or the incremental borrowing rate of the lease, being the rate that the individual lessee
would have to pay to borrow the funds necessary to obtain an asset of similar value in a similar
economic environment with similar terms, security and conditions. In determining the incremental
borrowing rate to be used, the Group applies judgement to establish the suitable reference rate andcredit spread.
Each lease payment is allocated between the liability (principal) and finance cost. The interest
expense is charged to the consolidated income statement as part of ‘Finance costs’ over the lease
period so as to produce a constant periodic rate of interest on the remaining balance of the liability
for each period.

Lease payments are presented as follows in the consolidated cash flow statement:• short-term lease payments, payments for leases of low-value assets and variable lease paymentsthat are not included in the measurement of the lease liabilities are presented within cash flows
from operating activities;• payments for the interest element of recognised lease liabilities are included in ‘Interest paid’
within cash flows from financing activities; and• payments for the principal element of recognised lease liabilities are presented within cash flows
from financing activities.

Leasing activities
The leases which are recorded on the consolidated balance sheet are principally in respect of vehicles
and buildings. Lease terms are negotiated on an individual basis and contain a wide range of different
terms and conditions.

Right-of-use assets are measured at cost comprising the following:

Extension and termination options are included in a number of leases across the Group. These are used
to maximise operational flexibility in terms of managing the assets used in the Group’s operations.
Extension options considered reasonably certain to be exercised relate to both buildings and motor
vehicles and do not exceed three years. Most termination options have not been considered reasonably
certain to be exercised.

a) the amount of the initial measurement of lease liability;

The Group’s carrying amount of lease liability is presented below as at 31 December:b) any lease payments made at or before the commencement date less any lease incentives
received;c) any initial direct costs; andd) any restoration costs.
The right-of-use assets are depreciated over the shorter of the assets’ useful life and the lease termon a straight-line basis. If the Group is reasonably certain to exercise a purchase option, theright-of-use asset is depreciated over the underlying asset’s useful life.

Current lease liability
Non-current lease liability
Total lease liability (refer to Note 26)2) applying the recognition exemption to leases of underlying assets with a low value, which mainlycomprise IT equipment.
Payments associated with short-term leases and leases of low-value assets are recognised on astraight-line basis as an expense in the consolidated income statement.
In determining the lease term, management considers all facts and circumstances that create an
economic incentive to exercise an extension option, or not exercise a termination option. Extension
options (or periods after termination options) are only included in the lease term if the lease isreasonably certain to be extended (or not terminated). The assessment is revised if a significant
event or a significant change in circumstances occurs, which affects this assessment and which iswithin the control of the lessee.

2021€ million

53.9
152.1
206.0

50.9
109.4
160.3

For the carrying amount of right-of-use assets per class of underlying asset, refer to Note 15.
The Group’s additions to right-of-use assets for the years ended 31 December are as follows:

The Group utilises a number of practical expedients permitted by the standard, namely:
1) applying the recognition exemption to short-term leases (i.e. leases with a term of 12 months orless) that do not contain a purchase option; and2022€ million

Land and buildings
Plant and equipment
Total additions

2022€ million

2021€ million

32.0
59.2
91.2

10.4
31.6
42.0

Right-of-use assets arising on business combinations in 2022 amounted to €40.1 million (2021: €nil).
The consolidated income statement includes the following amounts relating to depreciationof right‑of-use assets:

Land and buildings
Plant and equipment
Total depreciation charge

2022€ million

2021€ million

21.4
40.8
62.2

19.5
33.8
53.3

191

192

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
19. Trade, other receivables and assets

17. Leases continued
The following expenses have been included in cost of goods sold and operating expenses:
2022€ million

2021€ million

22.7
2.5
10.8

15.1
1.4
7.4

Expense relating to short-term leases
Expense relating to leases of low-value assets
Expense relating to variable lease payments

Interest expense on leases in 2022 was €16.4 million (2021: €9.9 million) and is recorded within ‘Financecosts’ in the consolidated income statement (refer to Note 10).
The total cash outflow for leases in 2022 was €103.6 million (2021: €91.0 million).
Expenses relating to short-term leases in 2022 and 2021 comprise consideration for leases with a termof 12 months or less used to cover seasonal business needs.

18. Inventories
Accounting policy
Inventories are stated at the lower of cost and net realisable value.
Cost for raw materials and consumables is determined on a weighted average basis. Cost for work inprogress and finished goods comprises the cost of direct materials and labour plus attributable
overhead costs. Cost of inventories includes all costs incurred to bring the product to its present
location and condition.
Net realisable value is the estimated selling price in the ordinary course of business, less theestimated costs necessary to complete and sell the inventory.
Inventories consisted of the following as at 31 December:

Finished goods
Raw materials and work in progress
Consumables
Total inventories

2022€ million

2021€ million

331.1
329.3
109.6
770.0

244.0
208.0
67.8
519.8

The amount of inventories recognised as an expense during 2022 was €4,509.6 million (2021: €3,420.4
million). This includes €1.1 million of write-offs related to the Russia-Ukraine conflict (refer to Note 6).
During 2022 provision for obsolete inventories recognised as an expense amounted to €19.2 million(2021: €16.2 million), whereas provision reversed in the year amounted to €0.4 million (2021: €0.6 million).

Accounting policies
Trade receivables are amounts due from customers for goods sold or services performed in theordinary course of business. They are initially recognised at fair value and subsequently measured
at amortised cost using the effective interest rate method. The normal credit terms are between
7-90 days upon delivery.
The Group applies the IFRS 9 simplified approach for trade and other receivables and follows an
Expected Credit Losses (‘ECLs’) approach for measuring the allowance of its trade receivables.
The expected loss rate is assessed on the basis of historical credit losses of 24 months before theyear end and adjusted to reflect current and forward-looking information. ECLs are based on the
difference between the contractual cash flows due in accordance with the contract and all the cash
flows that the Group expects to receive. The carrying amount of the receivable is reduced by theloss allowance, which is recognised as part of operating expenses. If a trade receivable ultimately
becomes uncollectible, it is written off initially against any loss allowance made in respect of thatreceivable with any excess recognised as part of operating expenses. Subsequent recoveriesof amounts previously written off or loss allowance no longer required are credited against
operating expenses.
The Group has entered into a contract that provides insurance coverage against defaulted
trade receivables.
This contract meets the definition of a financial guarantee contract, which is in substance partof the contract terms (that is, integral to the trade receivables) and is not recognised separately.
Therefore, the expected cash flows from the credit insurance are included in the measurementof ECLs of trade receivables.
Loans are initially recognised at the fair value net of transaction costs incurred. After initial recognition,
all interest-bearing loans are subsequently measured at amortised cost. Amortised cost is calculatedusing the effective interest rate method whereby any discount, premium or transaction costs
associated with a loan are amortised to the income statement over the lending period.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
19. Trade, other receivables and assets continued

The ageing analysis of trade receivables classified as current assets is as follows:2022€ million

Trade, other receivables and assets consisted of the following as at 31 December:

Trade receivables
Receivables from related parties(refer to Note 28)
Loans receivable
Receivables from sale of property, plant andequipment
Loans and advances to employees
Other receivables
Total trade and other receivables
Prepayments
Pension plan assets (refer to Note 22)
Non-current income tax receivable
VAT and other taxes receivable
Total other assets
Total trade, other receivables and assets

Current assets
2022€ million

Non-current assets
2022
2021
€ million€ million

2021€ million

804.8

705.5

0.1

0.1

56.5
1.1

60.4
0.5

–
0.8

–
1.0

0.4
10.1
144.1
1,017.0
88.6
–
–
42.3
130.9
1,147.9

0.5
6.0
89.3
862.2
69.4
–
–
17.0
86.4
948.6

–
–
1.4
2.3
14.3
51.9
9.7
–
75.9
78.2

–
–
–
1.1
10.4
42.0
16.3
–
68.7
69.8

An amount of €50.0 million (2021: €43.9 million) included in ‘Other receivables’ relates to receivablesfrom brand partners in the sale and distribution of premium spirits and energy drinks.
Non-current trade receivables relate to renegotiated receivables, which are expected to be settled
within the new contractual due date.
For offsetting impact on trade receivables, refer to Note 23.

Trade receivables
Trade receivables classified as current assets consisted of the following as at 31 December:

Trade receivables
Less: Loss allowance
Total trade receivables

2022€ million

2021€ million

880.6(75.8)
804.8

781.6(76.1)
705.5

Within due date
Past due – Up to three months
Past due – Three to six months
Past due – Six to nine months
Past due – More than nine months
Total trade receivables

2021€ millionGrosscarrying
amountLossallowanceTradereceivables

Grosscarrying
amountLossallowanceTradereceivables

720.2
70.5
7.0
3.6
79.3
880.6

(1.1)
(0.5)
(1.2)
(1.3)
(71.7)(75.8)

719.1
70.0
5.8
2.3
7.6
804.8

636.7
54.2
6.9
3.3
80.5
781.6

(2.9)
(1.2)
(1.0)
(1.0)
(70.0)(76.1)

633.8
53.0
5.9
2.3
10.5
705.5

The movement in the loss allowance during the year is as follows:

As at 1 January
Amounts written off during the year
Amounts recovered during the year
Increase in allowance recognised in income statement
Foreign currency translation
As at 31 December

2022€ million

2021€ million(76.1)
1.7
7.3(13.6)
4.9(75.8)(87.8)
14.7
3.7
(6.1)
(0.6)
(76.1)

2022€ million

2021€ million

50.9
5.7
(0.1)
56.5

57.3
3.3
(0.2)
60.4

2022
€ million

2021€ million

50.8
1.8
3.6
0.3
56.5

57.2
2.6
0.4
0.2
60.4

Receivables from related parties
The related party receivables, net of the loss allowance, are as follows:

Within due date
Past dueLess: Loss allowance
Total related party receivables
The ageing analysis of these receivables is as follows:

Within due date
Past due – Up to three months
Past due – Three to six months
Past due – More than nine months
Total

193

194

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
21. Trade and other payables

19. Trade, other receivables and assets continued
Net impairment
Net impairment loss on trade and other receivables recognised in the income statement is analysed
as follows:

Trade receivables
Other receivables and assets
Net impairment loss

2022
€ million

2021€ million

6.2
2.8
9.0

3.7
1.4
5.1

20. Assets classified as held for sale
Accounting policy
Non-current assets and disposal groups are classified as held for sale if it is considered highly
probable that their carrying amount will be principally recovered through a sale transaction rather
than through continuing use. This condition is regarded as met only when the sale is highly probableand the asset (or disposal group) is available for immediate sale in its present condition. In order for asale to be considered highly probable, management must be committed to a plan to sell the asset,
an active programme to locate a buyer and complete the plan must have been initiated, and the saleshould be expected to be completed within one year from the date of classification.
In the event that the criteria for continued classification as held for sale are no longer met, the assets
are reclassified to property, plant and equipment and the depreciation charge is adjusted for the
depreciation that would have been recognised had the assets not been classified as held for sale.
Non-current assets and disposal groups classified as held for sale are measured at the lower of theindividual assets’ previous carrying amount and their fair value less costs to sell.
As at 31 December 2022, the Group’s assets classified as held for sale amounted to €0.1 million,
comprising the net book value of plant and equipment in the Group’s Established segment (2021: €0.1
million in our Emerging segment), that has been written down to fair value less costs to sell (refer toNote 15). The fair value of assets classified as held for sale was determined through the use of a sales
comparison approach and is a non-recurring fair value measurement within level 3 of the fair value
hierarchy. Assets classified as held for sale in 2021 were disposed of during 2022.

Accounting policy
Trade payables are recognised initially at fair value and subsequently measured at amortised costusing the effective interest rate method.
Trade and other payables consisted of the following at 31 December:

Trade payables
Accrued liabilities
Payables to related parties (refer to Note 28)
Deposit liabilities
Other tax and social security liabilities
Salaries and employee-related payables
Contract liabilities (refer to Note 8)
Other payables
Total trade and other payables

2022€ million

2021€ million

947.2
727.9
268.6
112.6
159.2
69.2
14.7
32.5
2,331.9

678.3
565.6
326.1
92.6
126.0
56.9
11.8
28.5
1,885.8

The Group facilitates a supply chain financing programme under which the supplier can elect on an
invoice-by-invoice basis to either receive a discounted early payment from the partner bank, or
continue to be paid in line with the agreed payment terms; in either case the value and due date of theliability payable by the Group remain unchanged and as such the liability remains classified as trade andother payables. At 31 December 2022 invoices included in the programme amounted to €175.3 million(2021: €139.9 million).
Accrued liabilities regarding volume, marketing and promotional incentives as well as listing fees andother incentives provided to customers as at 31 December 2022 amounted to €287.3 million (2021:€239.9 million).

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
22. Provisions and employee benefits

The movements in restructuring and other provisions comprise:

Provisions and employee benefits consisted of the following as at 31 December:2022€ million

2021€ million

Current:
Employee benefits
Restructuring provisions
Other provisions
Total current provisions and employee benefits

131.5
3.2
46.8
181.5

115.2
23.6
18.4
157.2

Non-current:
Employee benefits
Restructuring provisions
Other provisions
Total non-current provisions and employee benefits
Total provisions and employee benefits

103.8
1.1
2.0
106.9
288.4

115.5
1.2
2.1
118.8
276.0

2022
€million
Restructuringprovision

As at 1 January
Arising during the year
Utilised during the year
Unused amount reversed
Arising from business combinations
Foreign currency translation
As at 31 Decemberb) Employee benefits

Accounting policy

Accounting policies

Where the Group expects a provision to be reimbursed, for example under an insurance contract,
the reimbursement is recognised as a separate asset only when such reimbursement is virtually certain.
If the effect of the time value of money is material, provisions are determined by discounting the
expected future cash flows at a pre-tax rate that reflects current market assessments of the timevalue of money and the risks specific to the liability.
Termination benefits are payable whenever an employee’s employment is terminated before thenormal retirement date or whenever an employee accepts voluntary redundancy in exchange forthese benefits. The Group recognises termination benefits at the earlier of the following dates: a)when the Group can no longer withdraw the offer of those benefits and b) when the Group
recognises costs for a restructuring that is within the scope of IAS 37 ‘Provisions, contingent
liabilities and contingent assets’ and involves the payment of termination benefits (refer to Note 9).
In the case of an offer made to encourage voluntary redundancy, the termination benefits aremeasured based on the number of employees expected to accept the offer.

20.5
22.5
(1.4)
(3.1)
15.1
(4.8)
48.8

Other
provisions

26.0
21.7
(21.5)
(1.4)
–
–
24.8

9.9
13.5
(2.8)
(0.1)
–
–
20.5

During 2022 a restructuring provision of €3.9 million was recognised in connection with the new
business model in Russia, following the Russia-Ukraine conflict (refer to Note 6), which was utilised
during the year. Other provisions primarily comprise provisions in relation to employee litigation, legal
and other tax provisions.

a) Provisions
Provisions are recognised when: the Group has a present obligation (legal or constructive) as a resultof a past event; it is probable that an outflow of resources embodying economic benefits will be
required to settle the obligation; and a reliable estimate can be made of the amount of the obligation.

24.8
19.3
(32.1)
(7.8)
0.1
–
4.3

Other
provisions

2021€million
Restructuringprovision

The Group operates a number of defined benefit and defined contribution pension plansin its territories.
The defined benefit plans are made up of both funded and unfunded pension plans and employee
leaving indemnities. The assets of funded plans are generally held in separate trustee-administeredfunds and are financed by payments from employees and/or the relevant Group companies.
The liability recognised in the balance sheet in respect of defined benefit plans is the present valueof the defined benefit obligation at the balance sheet date less the fair value of the plan assets.
For defined benefit pension plans, pension costs are assessed using the projected unit credit
method. Actuarial gains and losses arising from experience adjustments and changes in actuarial
assumptions are charged or credited to equity in other comprehensive income in the period inwhich they arise. Such actuarial gains and losses are not reclassified to the income statement in
subsequent periods. The defined benefit obligations are measured at the present value of theestimated future cash outflows using interest rates of high-quality corporate bonds that are
denominated in the currency in which the benefits will be paid, and that have terms approximating to
the terms of the related obligation. In countries where there is no deep market in such bonds, themarket rates on government bonds are used. Past service cost is recognised immediately in theincome statement. A number of the Group’s operations have other long-service benefits in theform of jubilee plans. These plans are measured at the present value of the estimated future cash
outflows with immediate recognition of actuarial gains and losses in the income statement.
The Group’s contributions to the defined contribution pension plans are charged to the income
statement in the period to which the contributions relate.

195

196

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
22. Provisions and employee benefits continued

Coca-Cola HBC provides long-service benefits in the form of jubilee plans to its employees in Austria,
Croatia, Nigeria, Poland, Serbia, Slovenia and Switzerland.

b) Employee benefits continued

Defined benefit obligation by segment is as follows for the years ended 31 December:

Critical accounting estimates
The Group provides defined benefit pension plans as an employee benefit in certain territories.
Determining the value of these plans requires several actuarial assumptions and estimates that may
differ from actual developments in the future. These include the determination of the discountrates, rate of compensation increases, rate of pension increases and life expectancy of pensioners
at the age of 65. Due to the long-term nature of these plans, such estimates are subject tosignificant uncertainty. Details on the key assumptions used and a sensitivity analysis regarding theimpact of reasonably possible changes in key assumptions on the defined benefit obligation are
further presented below.
Employee benefits consisted of the following as at 31 December:Defined benefit plans:
Employee leaving indemnities
Pension plans
Long-service benefits (jubilee plans) and other benefits
Total defined benefit plans
Other employee benefits:
Annual leave
Other employee benefits
Total other employee benefits
Total employee benefits obligations

2022€ million

2021€ million

67.9
3.4
13.2
84.5

78.9
6.2
12.1
97.2

7.6
143.2
150.8
235.3

9.7
123.8
133.5
230.7

Other employee benefits are primarily comprised of employee bonuses which are linked to businessand individual performance metrics.
Employees of Coca-Cola HBC’s subsidiaries in Austria, Bulgaria, Croatia, Greece, Italy, Montenegro,
Nigeria, Poland, Romania, Serbia and Slovenia are entitled to employee leaving indemnities, generally
based on each employee’s length of service, employment category and remuneration. These areunfunded plans where the Company meets the payment obligation as it falls due.
Coca-Cola HBC’s subsidiaries in Austria, Northern Ireland, the Republic of Ireland and Switzerlandsponsor defined benefit pension plans. Of the three plans in the Republic of Ireland, two have plan assets,
as do the two plans in Northern Ireland, and one plan out of the three in Switzerland. The Austrian plans
do not have plan assets and the Company meets the payment obligation as it falls due. The defined
benefit plans in Austria, Republic of Ireland and Northern Ireland are closed to new members.

€1.7m€58.0m2022€24.8m Total €84.5m€2.1m€73.6m2021
Established

Developing€21.5m Total €97.2m

Emerging

The average duration of the defined benefit obligations is 14 years and the total employer contributions
expected to be paid in 2023 are €11.6 million.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
22. Provisions and employee benefits continued
The reconciliation of plan assets and plan liabilities for the years ended 31 December is as follows:

As at 1 January 2021
Current service cost
Past service cost
Administrative expenses
Curtailment/settlement
Interest income/(expense)
Actuarial gains
Total expense recognised in income statement
Gains from change in demographic assumptions
Gains from change in financial assumptions
Experience adjustments
Return on plan assets excluding interest income
Total remeasurements recognised in othercomprehensive income
Benefits paid
Employer’s contributions
Participants’ contributions
Net increase in defined benefit obligation from othermovements
Foreign currency translation
As at 31 December 2021

Plan assets€ million

Plan liabilities€ million

Net (deficit) /surplus€ million

481.3
–
–
(0.3)
(16.4)
2.3–(14.4)–––
34.6(538.1)(10.8)
(1.6)
–
14.2
(4.0)
0.6
(1.6)
1.4
16.0
(2.4)
–

(56.8)(10.8)
(1.6)
(0.3)
(2.2)
(1.7)
0.6
(16.0)
1.4
16.0
(2.4)
34.6

34.6
(23.1)
16.4
4.6

15.0
23.1
–
(4.6)

49.6
–
16.4
–

–
20.0
519.4

(0.7)
(19.4)(526.3)

(0.7)
0.6
(6.9)

As at 1 January 2022
Current service cost
Past service cost
Administrative expenses
Curtailment/settlement
Interest income/(expense)
Actuarial gains
Total income/(expense) recognised in income
statement
Loss from change in demographic assumptions
Gains from change in financial assumptions
Experience adjustments
Return on plan assets excluding interest income
Total remeasurements recognised in othercomprehensive income
Benefits paid
Employer’s contributions
Participants’ contributions
Net increase in defined benefit obligation from othermovements
Foreign currency translation
As at 31 December 2022

Plan assets€ million

Plan liabilities€ million

Net (deficit) /surplus€ million

519.4
–
–
(0.3)
(2.9)
4.4
–

(526.3)(11.8)
(3.0)
–
2.8
(6.1)
2.0

(6.9)
(11.8)
(3.0)
(0.3)
(0.1)
(1.7)
2.0

1.2
–
–
–
(91.9)(16.1)
(2.9)
145.2
(8.7)
–

(14.9)
(2.9)
145.2
(8.7)
(91.9)(91.9)(22.4)
13.1
4.8

133.6
22.4
–
(4.8)

41.7
–
13.1
–

–
7.7
431.9

(0.8)
(6.5)
(398.5)

(0.8)
1.2
33.4

197

198

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
22. Provisions and employee benefits continued
The effect of the asset ceiling on plan assets and net deficit for the years ended 31 December is as follows:

Fair value of plan assets at 31 December excluding asset ceiling
Opening unrecognised asset due to the asset ceiling
Change in asset ceiling recognised in other comprehensive income
Exchange rate gain
Interest income on unrecognised asset recognised in income
statement
Fair value of plan assets at 31 December including asset ceiling

Present value of funded obligations
Fair value of plan assets
Defined benefit obligations of funded plans
Present value of unfunded obligations
Unrecognised asset due to asset ceiling
Defined benefit obligations
Plus: Amounts recognised within non-current assets (refer to Note 19)
Total defined benefit obligations

2022€ million

2021€ million

431.9(48.3)(15.7)(1.8)

519.4(14.1)(33.5)
(0.7)

(0.2)
365.9

–
471.1

2022
€ million

2021€ million

316.6(431.9)(115.3)
81.9
66.0
32.6
51.9
84.5

434.1
(519.4)(85.3)
92.2
48.3
55.2
42.0
97.2

Funding levels are monitored in conjunction with the agreed contribution rate. The funding level of thefunded plans as at 31 December 2022 was 116% (2021: 109%).
Five of the plans have funded status surplus totalling €51.9 million as at 31 December 2022 (2021: fiveplans, totalling €42.0 million) that is recognised as an asset on the basis that the Group has an
unconditional right to future economic benefits either via a refund or a reduction in future contributions.
Defined benefit plan expense is included in employee costs and presented in cost of goods sold andoperating expenses.
The assumptions (weighted average for the Group) used in computing the defined benefit obligation
comprised the following for the years ended 31 December:

Discount rate
Rate of compensation increase
Rate of pension increase
Life expectancy for pensioners at the age of 65 in years:
Male
Female

2022
%

2021
%

3.6
2.8
0.9

1.2
2.5
1.0

22
24

22
24

Asset liability matching: Plan assets allocated to growth assets are monitored regularly to ensure theyremain appropriate and in line with the Group’s long-term strategy to manage the plans. As the plansmature, the level of investment risk will be reduced by investing more in assets such as bonds that
better match the liabilities.
Pension plan assets are invested in different asset classes in order to maintain a balance between risk
and return. Investments are well diversified to limit the financial effect of the failure of any individual
investment. Through its defined benefit plans the Group is exposed to a number of risks, as outlined
below:• Asset volatility: The liabilities are calculated using a discount rate set with reference to corporatebond yields; if assets underperform this yield, a deficit will be created. The Northern Ireland, theRepublic of Ireland and Swiss plans hold a significant proportion of growth assets (equities), which are
expected to outperform corporate bonds in the long term while being subject to volatility and risk inthe short term.
• Changes in bond yields: A decrease in corporate bond yields will increase the plan liabilities, although
this will be partially offset by an increase in the value of the plans’ bond holdings. Conversely an
increase in corporate bond yields will decrease the plan liabilities, although this will be partially offset
by a decrease in the value of the plans’ bond holdings.
• Inflation: The Northern Ireland, the Republic of Ireland and Swiss plans’ benefit obligations are linked
to inflation, which is used as a basis to determine the rate of compensation increases. As a result,higher inflation will lead to higher liabilities, although, in most cases, caps on the level of inflationary
increases are in place to protect against extreme inflation. The majority of the assets are either
unaffected by or only loosely correlated with inflation, meaning that an increase in inflation will also
increase the deficit.
• Life expectancy: The majority of the pension plans’ obligations are to provide benefits for the life of
the member, so increases in life expectancy will result in an increase in the liabilities.
The sensitivity analysis presented below is based on a change in a single assumption while all otherassumptions remain constant.
Change inassumption

Discount rate
Rate of compensation increase
Rate of pension increase
Life expectancy

0.50%
0.50%
0.50%
1 yearImpact on defined benefit obligation (%)
Increase in assumption
Decrease in assumption
2022
2021
2022
2021

(5.5%)
1.5%
3.8%
2.4%

(8.2%)
1.8%
5.2%
2.8%

7.1%
(1.4%)(3.8%)(2.4%)

9.4%(1.5%)(4.9%)(2.8%)

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
23. Offsetting financial assets and financial liabilities

22. Provisions and employee benefits continued
Plan assets are invested as follows:

Accounting policy

Assets category 2022 (%)

Equity securities – Eurozone
Equity securities – Non-Eurozone
Government bonds – Eurozone
Government bonds – Non-Eurozone
Corporate bonds – Eurozone
Corporate bonds – Non-Eurozone
Real estate
Cash
Other

The Group offsets financial assets and financial liabilities to the net amount reported in thebalance sheet when it currently has a legally enforceable right to offset the recognised amounts
and it intends to settle on a net basis or to realise the asset and settle the liability simultaneously.
The legally enforceable right must not be contingent on future events and must be enforceable in
the normal course of business and in the event of default, insolvency or bankruptcy of the Company
or the counterparty.

Assets category 2021 (%)

2%
19%
17%
12%
11%
12%
13%
2%
12%

Equity securities – Eurozone
Equity securities – Non-Eurozone
Government bonds – Eurozone
Corporate bonds – Eurozone
Corporate bonds – Non-Eurozone
Real estate
Cash
Other

3%
22%
30%
10%
10%
11%
1%
13%

The assets of funded plans are generally held in separately administered trusts, either as specific assets
or as a proportion of a general fund, or are insurance contracts. Plan assets held in trust are governed
by local regulations and practice in each country. The category ‘Other’ mainly includes investments
in funds holding a portfolio of assets. Plan assets relate predominantly to quoted financial instruments.

The Group enters into derivative transactions under International Swaps and Derivatives Association(ISDA) master netting agreements or other similar agreements. In general, under such agreements thecounterparties can elect to settle as one single net amount the aggregated amounts owed by eachcounterparty on a single day with respect to all outstanding transactions of the same currency and thesame type of derivative. In the event of default or early termination all outstanding transactions under
the agreement are terminated and subject to any set-off. These agreements do not meet all of the IAS
32 criteria for offsetting in the balance sheet as the Group does not have any current legally enforceable
right to offset amounts since the right can only be applied if elected by both counterparties.
The financial assets and financial liabilities presented below are subject to offsetting, enforceable
master netting or similar agreements. The column ‘Net amount’ shows the impact on the Group’sbalance sheet if all set-off rights were exercised.
Financial liabilities offset against trade receivables mainly relate to accrued customer rebates.

a) Financial assets
As at 31 December 2022
Relatedamounts not
set off in thebalance sheet

Equity securities were not invested in ordinary shares of the Company as at 31 December 2022
or 31 December 2021.

Defined contribution plans
The expense recognised in the income statement in 2022 for the defined contribution plans is €22.5
million (2021: €19.4 million). This is included in employee costs and recorded in cost of goods sold andoperating expenses.

Derivative financial assets
Trade receivables
Total

Gross
amounts ofrecognised
financialassets€ millionGrossamounts ofrecognised
financialliabilities set
off in thebalance sheet€ million

Net amountsof financial
assetspresented
in thebalance sheet€ million

Financial
instruments€ million

Net amount€ million

36.1
876.1
912.2

–
(71.3)(71.3)

36.1
804.8
840.9

(16.7)–(16.7)

19.4
804.8
824.2

199

200

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
24. Business combinations

23. Offsetting financial assets and financial liabilities continued
As at 31 December 2021

Accounting policy

Relatedamounts not
set off in thebalance sheet
Grossamounts of
Grossrecognised
amounts offinancialrecognised liabilities set off
financialin theassets balance sheet€ million€ million

Derivative financial assets
Trade receivables
Total

48.2
764.0
812.2

–
(58.5)(58.5)Net amountsof financial
assetspresented
in thebalance sheet€ million

Financial
instruments€ million

Net amount€ million

48.2
705.5
753.7

(8.1)
–
(8.1)

40.1
705.5
745.6

b) Financial liabilities
As at 31 December 2022
Relatedamounts not
set off in thebalance sheet

Derivative financial liabilities
Trade payables
Total

For each business combination, the Group elects to measure the non-controlling interest in theacquiree either at fair value or at the proportionate share of the acquiree’s identifiable net assets.

Grossamounts ofrecognised
financialliabilities€ millionGrossamounts ofrecognised
financialassets set off
in thebalance sheet€ million

Net amountsof financial
liabilities
presented in
the balancesheet€ million

Financial
instruments€ million

Net amount€ million

45.6
1,018.5
1,064.1–(71.3)(71.3)

45.6
947.2
992.8

(16.7)–(16.7)

28.9
947.2
976.1

As at 31 December 2021
Relatedamounts not
set off in thebalance sheet

Derivative financial liabilities
Trade payables
Total

The acquisition method of accounting is used to account for business combinations.
The consideration transferred is the fair value of any asset transferred, shares issued and liabilities
assumed. The consideration transferred includes the fair value of any asset or liability resulting froma contingent consideration arrangement. Identifiable assets acquired and liabilities and contingent
liabilities assumed are measured initially at their fair values at the acquisition date. The excess of theconsideration transferred and the fair value of non-controlling interest over the net assets acquired
and liabilities assumed is recorded as goodwill. In a business combination achieved without thetransfer of consideration, the acquisition-date fair value of the previously held interest in theacquiree is used in place of the acquisition-date fair value of the consideration transferred tomeasure goodwill or a gain on a bargain purchase. Acquisition costs comprise costs incurred toeffect a business combination such as finder’s, advisory, legal, accounting, valuation and otherprofessional or consulting fees. Integration costs comprise direct incremental costs necessary
for the acquiree to operate within the Group. All acquisition and integration-related costs are
expensed as incurred.

If the business combination is achieved in stages, the acquisition date carrying value of the previously
held equity interest in the acquiree is remeasured to fair value at the acquisition date. Any gains orlosses arising from such remeasurement are recognised in profit or loss, within operating expenses
in line ‘Acquisition and integration costs’. Any accumulated amounts regarding the Group’s share ofother comprehensive income of the previously held equity interest are reclassified to the income
statement, within operating expenses in line ‘Acquisition and integration costs’. The Group has also
elected to present gains on bargain purchase within operating expenses in line ‘Acquisition andintegration costs’.
Refer also to Note 2 for accounting policy regarding basis of consolidation.

Acquisition of Coca-Cola Bottling Company of Egypt S.A.E.
On 12 August 2021, the Group entered into a sale and purchase agreement to acquire approximately
52.7% of Coca-Cola Bottling Company of Egypt S.A.E. (‘CCBCE’), the bottling partner of The Coca-Cola
Company in Egypt, from MAC Beverages Limited and certain of its affiliated entities (’MBL acquisition’).
The MBL acquisition was completed on 13 January 2022 and resulted in the Group obtaining
control over CCBCE.

Grossamounts ofrecognised
financialliabilities€ millionGrossamounts ofrecognised
financialassets set off
in thebalance sheet€ million

Net amountsof financial
liabilities
presented in
the balancesheet€ million

Financial
instruments€ million

Net amount€ million

14.6
736.8
751.4

–
(58.5)(58.5)

14.6
678.3
692.9

(8.1)
–
(8.1)

6.5
678.3
684.8

The acquisition of CCBCE expands the Group’s existing footprint on the African continent and further
increases its exposure to high-growth markets, as it provides access to one of the largest non-alcoholic
ready-to-drink markets by volume in Africa. In addition, sharing of the Group’s proven capabilities,
experience and best practices with CCBCE is expected to unlock growth opportunities, creating value
for all stakeholders.
The operating results and assets and liabilities of CCBCE have been consolidated from 14 January 2022.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
24. Business combinations continued
The fair value of the consideration for the MBL acquisition consisted of US Dollar 303.7 million (€264.9
million), which was transferred on acquisition, and an additional payment of US Dollar 124.0 million(€119.1 million), based on CCBCE’s past performance, net financial position and working capital
movement, which was transferred in October 2022. Foreign exchange loss arising on settlement of theconsideration payable for the MBL acquisition amounted to €11.3 million and was presented in line
‘Payment for business combinations, net of cash acquired’ of the consolidated cash flow statement,
while proceeds from settlement of derivatives used to hedge the relevant foreign currency risk
amounted to €13.0 million and were presented in line ‘Proceeds from settlement of derivatives relating
to business combination’ of the consolidated cash flow statement.
As part of the MBL acquisition completion, a convertible loan which had been granted to CCBCE from awholly-owned affiliate of TCCC, one of its major shareholders, was also transferred to the Group for aconsideration of €19.1 million, which was presented in line ‘Repayments of borrowings’ in the
consolidated cash flow statement. The consideration was equal to the outstanding principal amount of
the convertible loan and any unpaid interest at the time of its transfer. The loan was convertible at its
original maturity in March 2022 into new CCBCE shares at fair market value and was eliminated upon
consolidation of CCBCE. The conversion option was not subsequently exercised.
Details of the MBL acquisition with regard to the determined fair values of the net assets acquired,
non-controlling interests and goodwill are presented in the below table.
Fair value€ million

Franchise agreements
Property, plant and equipment
Inventories
Trade, other receivables and assets
Cash and cash equivalents
Borrowings
Trade and other payables
Net deferred tax liabilities
Net identifiable assets acquired
Less: Non-controlling interests
Add: Goodwill arising on acquisition
Net assets acquired

367.7
318.7
59.3
64.5
15.9
(217.0)(129.6)(122.7)356.8(168.9)
196.1
384.0

No significant changes to net identifiable assets acquired have been identified compared to the relevant
amounts disclosed as part of the Group’s 2021 Integrated Annual Report.
The goodwill is attributable to CCBCE’s strong market position and growth potential. The line
‘Borrowings’ in the above table includes the convertible loan as well as third-party loans of €122.7
million, which have been repaid and replaced with intra-group borrowings. The Group has chosen torecognise the non-controlling interests at their proportional share of the fair value of CCBCE’s net
identifiable assets acquired.

The Group incurred acquisition and integration costs of €8.8 million in 2022 (2021: €13.9 million)
regarding the acquisition of CCBCE, which were included in operating expenses.
On 12 August 2021, the Group entered into an additional sale and purchase agreement to acquireapproximately 42% of CCBCE, from a wholly-owned affiliate of TCCC (’TCCC acquisition’). The TCCC
acquisition was completed on 25 January 2022.
The fair value of the consideration paid for the TCCC acquisition amounted to US Dollar 122.7 million(€108.9 million). The transaction was treated as separate to the MBL acquisition, considering that whilst
the transactions above were entered into at the same time and in contemplation of each other, they areseparate from a commercial and contractual perspective. The TCCC acquisition was accordingly
accounted for as an equity transaction.
Following the completion of both the transactions, the Group holds a 94.7% interest in CCBCE.
The acquired business contributed revenue of €483.5 million to the Group for the period from 14
January 2022 to 31 December 2022, while it recorded a total net loss of €17.0 million for the same
period. If the acquisition had occurred on 1 January 2022, consolidated revenue for 2022 would havebeen higher by €18.8 million, while net loss recorded would not have been significantly different.
The fair value of trade, other receivables and assets acquired includes trade receivables with a fair valueof €28.3 million. The gross contractual amount for trade receivables acquired was €42.0 million, of
which €13.7 million was considered to be uncollectible.

Multon A.O. group of companies (’Multon’)
The Group holds a 50% interest in Multon, which is engaged in the production and distribution of juices
in Russia and was jointly controlled by the Group and TCCC. On 8 March 2022, as a result of theRussia-Ukraine conflict, TCCC announced that it was suspending its business in Russia.
On 10 August 2022, TCCC unilaterally waived certain of its governance rights in connection with its 50%
interest in Multon, while retaining consent rights in respect of certain limited board and shareholder
reserved matters that are protective in nature (the ‘Waiver’). The waived rights include, among others,
TCCC’s appointment rights over Multon’s board and management, TCCC’s approval rights overMulton’s financial budgets and rights to receive any dividends or other distributions declared or paid by
Multon, which were accordingly assumed by the Group. The Waiver is irrevocable for a two-year period,
while there was no consideration transferred in connection with the Waiver. For the duration of theWaiver period, TCCC waives any rights to receive any dividends or other distributions declared or paidby Multon.
Given that TCCC waived the aforementioned rights, the Group has power over Multon, exposure tovariable returns and the ability to use its power to affect its returns from Multon. Moreover, the irrevocable
period of the Waiver is considered long enough so as not to prevent control by the Group. Hence,
considering the criteria set out in IFRS 10 ‘Consolidated financial statements’, the Group concluded
that, effective 11 August 2022, it controlled Multon. The change in control of Multon was accounted for
as a business combination achieved in stages in line with IFRS 3 ‘Business combinations’ requirements.

201

202

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
24. Business combinations continued
The fair value of the Group’s previously held equity interest in Multon, following TCCC unilaterally
waiving certain of its governance rights, amounted to approximately €250 million and was estimatedbased on discounted forecasted cash flows of the business, using a discount rate of 27.8%. As a resultof the change in control of Multon, a gain on remeasurement of the previously held equity interest to fairvalue amounting to €70.8 million and a loss regarding the reclassification to the income statement of
the Group’s share of Multon’s other comprehensive income amounting to €145.2 million wererecognised in 2022. The arising net loss of €74.4 million was recognised within ‘Operating expenses’ lineof the consolidated income statement, included under Emerging markets for segmental reporting
purposes and within ‘Other non-cash items’ line of the consolidated cash flow statement.The Group
incurred acquisition costs of €0.1 million in 2022 regarding the change in control of Multon, which were
included in operating expenses.
Information on the fair values of the net assets acquired, non-controlling interests and gain frombargain purchase arising on the business combination is presented in the below table.
Fair value€ million

Trademarks
Property, plant and equipment
Inventories
Trade, other receivables and assets
Cash and cash equivalents
Borrowings
Trade and other payables
Net deferred tax liability
Net identifiable assets acquired
Less: Non-controlling interests
Less: Gain from bargain purchase arising on business combination
Net assets acquired

60.8
63.6
37.5
212.4
24.2
(1.2)
(50.1)(2.7)
344.5(90.7)(3.9)
249.9

The cash and cash equivalents acquired amounting to €24.2 million was presented in line ‘Payment forbusiness combinations, net of cash acquired’ in the consolidated cash flow statement. Trade balances
between the Group and Multon were effectively settled on acquisition, with no gain or loss recognisedon the settlement, as the balances were effectively settled at the recorded amount.
The gain from bargain purchase arises mainly due to the deferred tax asset recognised on the economic
obsolescence attributed to Multon’s machinery and equipment and was presented in line ‘Operating
expenses’ in the consolidated income statement and line ‘Other non-cash items’ in the consolidated
cash flow statement. More specifically, the business enterprise value, which was estimated based on
discounted forecasted cash flows of the business, was lower than the estimated fair value of the net
identifiable assets acquired, using the cost of depreciated replacement to new methodology for themachinery and equipment of Multon. The Group considered that a market participant would not be
willing to buy the net assets of the business at the estimated fair value, as described above, if the utilityof the same, measured by the discounted forecasted cash flows of the business is smaller.

Therefore, a downward adjustment of €39.8 million was made on the fair value of the identifiable assets
as economic obsolescence in connection with Multon’s machinery and equipment, representing thedifference between the business enterprise value and the fair value of net identifiable assets. This inturn resulted in the recognition of a deferred tax asset, which is considered recoverable based on the
future economic performance of Multon and was included in the value of net identifiable assets acquired.
The Group has chosen to recognise the non-controlling interests in Multon (TCCC’s 50% share) attheir fair value. This was determined based on discounted forecasted cash flows of the business anda scenario-based approach altering the potential dates at which TCCC could potentially reinstate its
rights in Multon, based on the terms of the unilateral Waiver described above. The discount rate usedin discounting the forecasted cash flows was 27.8%.
More specifically, the Group has considered the following scenarios:• a Waiver ranging from two years to eight years with an exit (of the agreement) in each of the years;and• a perpetuity Waiver of rights.
In addition to the exit-year range for the revocability of the Waiver, the Group assigned a set ofprobabilities to each of the years within this range in which the Waiver could be revoked, including aprobability for the indefinite Waiver scenario. Both the range for the revocability of the Waiver and theassociated probabilities assigned were established based on management’s best estimate regarding
TCCC resuming its business in Russia, considering also the outcomes of historical cases of sanctions.
As described above, following the Waiver TCCC effectively has no entitlement over Multon’s profit orloss generated in the ordinary course of business as it has contractually waived its rights over dividendor other distributions made by Multon. As a result Multon’s net profit or loss will not be allocated to
non-controlling interests during the period of the Waiver.
Net sales revenue and profit after tax contributed by Multon to the Group for the period from 11 August2022 to 31 December 2022 amounted to €271.8 million and €77.7 million respectively. If the businesscombination had occurred on 1 January 2022, consolidated net sales revenue for the year ended
31 December 2022 would have been higher by €307.3 million, while net profit recorded would havebeen higher by €32.3 million.

Acquisition of Three Cents
On 21 October 2022, the Group acquired 100% of the issued shares of ESM Effervescent Sodas
Management Limited and its subsidiary Three Cents Hellas Single Member S.A. (together ‘ThreeCents’), the owner of the super-premium adult sparkling beverage and mixer product line under theThree Cents brand, for a consideration of €45.9 million. The acquisition complements and further
premiumises the Group’s existing adult sparkling beverage portfolio and will better position the Groupto address a wider range of consumer tastes and segments.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
24. Business combinations continued

25. Financial risk management and financial instruments

Details of the acquisition with regard to the provisionally determined fair values of the net assets
acquired and goodwill are presented in the table below:

Accounting policies

Fair value€ million

Trademarks
Property, plant and equipment
Trade, other receivables and assets
Cash and cash equivalents
Borrowings
Trade and other payables
Net deferred tax liabilities
Net identifiable assets acquired
Add: Goodwill arising on acquisition
Net assets acquired

22.6
0.2
1.9
1.9
(0.1)
(1.9)
(2.7)
21.9
24.0
45.9

The acquisition resulted in the Group recording €24.0 million of goodwill and €22.6 million of trademarks
in its Established segment. The goodwill arising is attributable to the brand’s growth potential across theGroup’s markets. Acquisition-related costs of €0.3 million were included in the 2022 operating
expenses, as a result of the above acquisition.
The fair value of trade, other receivables and assets acquired includes trade receivables with a fairvalue of €0.8 million, while there was no significant amount of trade receivables acquired considered
to be uncollectible.
Net sales revenue and loss after tax contributed by Three Cents to the Group for the period from 21
October 2022 to 31 December 2022, amounted to €0.9 million and €2.3 million respectively. If thebusiness combination had occurred on 1 January 2022, consolidated net sales revenue for the year
ended 31 December 2022 would have been higher by €9.2 million, while net profit recorded would havebeen higher by €0.8 million.

Financial assets
On initial recognition financial assets are recorded at fair value plus, in the case of financial assets not
at fair value through profit or loss (FVTPL), any directly attributable transaction costs. Transaction
costs of financial assets at FVTPL are expensed.
Financial assets are classified into three categories:a) Financial assets at amortised cost (debt instruments)
The classification of debt instruments at amortised cost depends on two criteria: a) the Group’sbusiness model for managing assets and b) whether the instruments’ contractual cash flows
represent solely payments for principal and interest on the principal amount outstanding (the ‘SPPI
criterion‘). If both criteria are met the financial assets of the Group are subsequently measured
at amortised cost whereby any interest income is recognised using the effective interest method.
This category includes trade receivables, treasury bills and time deposits. The accounting policy for
trade receivables is described in Note 19.
b) Financial assets through other comprehensive income (FVOCI)The Group also has investments in financial assets at FVOCI. These include equity investments thatare not of a trading nature and which are subsequently recorded at fair value. The Group intends tohold these equity instruments for the foreseeable future and has irrevocably elected to classify themas financial assets at FVOCI upon initial recognition. Upon derecognition of these financial assets,
there is no recycling of gains or losses to the income statement.
c) Financial assets through profit or loss (FVTPL)The Group also has investments in financial assets at FVTPL, which are subsequently measured
at fair value and where changes in fair value are recognised in the income statement. Financial assets
at FVTPL mainly comprise money market funds.
For those financial assets that are not subsequently held at fair value, the Group assesses whether
there is evidence of impairment at each balance sheet date.
Derivative financial instruments
The Group uses derivative financial instruments, including currency, commodity and interest rate
derivatives, to manage currency, commodity price and interest rate risk associated with the Group’s
underlying business activities. The Group does not enter into derivative financial instruments for
trading activity purposes.
All derivative financial instruments are initially recognised on the balance sheet at fair value and aresubsequently remeasured at their fair value. Changes in the fair value of derivative financial instruments
are recognised at each reporting date either in the income statement or in equity, depending onwhether the derivative financial instrument qualifies for hedge accounting as a cash flow hedge.

203

204

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
25. Financial risk management and financial instruments continued
Embedded derivatives in financial host contracts are recorded at fair value through profit or loss
together with the host contracts.
All derivative financial instruments that are not part of an effective hedging relationship(undesignated hedges) are classified as assets or liabilities at fair value through profit or loss.
At the inception of a hedge transaction the Group documents the relationship between the hedging
instrument and the hedged item, as well as its risk management objective and strategy for undertaking
the hedge transaction. This process includes linking the derivative financial instrument designatedas a hedging instrument to the specific asset, liability, firm commitment or forecast transaction.
The Group has established a hedge ratio of 1:1 for the hedging relationships as the underlying risksof the hedging instruments are identical to the hedged risks component. The economic relationshipbetween the hedged item and the hedging instrument is assessed on an ongoing basis.
Ineffectiveness may arise if the timing or the notional value of the forecast transaction changes, or if
the credit risk changes impacting the fair value movements of the hedging instruments.
Changes in the fair value of derivative financial instruments (both the intrinsic value and the aligned
time value) that are designated and effective as hedges of future cash flows are recognised directlyin other comprehensive income and the ineffective portion is recognised immediately in the income
statement. Amounts accumulated in equity are recycled to the income statement as the related
hedged asset acquired or liability assumed affects the income statement.
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated,
exercised, or no longer qualifies for hedge accounting. At that time, any cumulative gain or loss
on the hedging instrument recognised in equity is retained in equity until the forecast transaction
occurs. If a hedged transaction is no longer expected to occur, the net cumulative gain or loss
recognised in equity is transferred to the income statement.
Derivatives embedded in non-financial host contracts are accounted for as separate derivatives
and recorded at fair value if:• their economic characteristics and risks are not closely related to those of the host contracts;• the host contracts are not designated as at fair value through profit or loss; and• a separate instrument with the same terms as the embedded derivative meets the definitionof a derivative.
These embedded derivatives are measured at fair value with changes in fair value recognised in
profit or loss. Reassessment only occurs if there is either a change in the terms of the contract thatsignificantly modifies the cash flows that would otherwise be required or a reclassification of afinancial asset out of the fair value through profit or loss category.
Regular purchases and sales of investments are recognised on the trade date, which is the day
the Group commits to purchase or sell. The investments are recognised initially at fair value plustransaction costs, except in the case of FVTPL. For investments traded in active markets, fair value
is determined by reference to stock exchange quoted bid prices. For other investments, fair value
is estimated by reference to the current market value of similar instruments or by reference to thediscounted cash flows of the underlying net assets.

Financial risk factors
The Group’s activities expose it to a variety of financial risks: market risk (including foreign currency risk,
commodity price risk and interest rate risk), credit risk, liquidity risk and capital risk. The Group’s overallrisk management programme focuses on the volatility of financial markets and seeks to minimise
potential adverse effects on the Group’s cash flows. The Group uses derivative financial instruments
to hedge certain risk exposures. Risk management is carried out by Group Treasury in a controlledmanner, consistent with the Board of Directors’ approved policies. Group Treasury identifies,
evaluates and hedges financial risks in close co-operation with the Group’s subsidiaries. The Boardof Directors has approved the Treasury Policy which provides the control framework for all treasury
and treasury-related transactions.

Market riska) Foreign currency risk
The Group is exposed to the effect of foreign currency risk on future transactions, recognised
monetary assets and liabilities that are denominated in currencies other than the local entity’sfunctional currency, as well as net investments in foreign operations. Foreign currency forward, option
and futures contracts are used to hedge a portion of the Group’s foreign currency risk. The majorityof the foreign currency forward, option and futures contracts have maturities of less than one year after
the balance sheet date.
Management has set up a policy that requires Group companies to manage their foreign exchange
risk against their functional currency. To manage their foreign exchange risk arising from futuretransactions and recognised monetary assets and liabilities, entities in the Group use foreign
currency forward, option and futures contracts transacted by Group Treasury. Group Treasury’s risk
management policy is to hedge, on an average coverage ratio basis, between 25% and 80% of
anticipated cash flows for the next 12 months by using a layer strategy and 100% of balance sheet
remeasurement risk in each major foreign currency for which hedging is applicable. Each subsidiary
designates contracts with Group Treasury as fair value hedges or cash flow hedges, as appropriate.
External foreign exchange contracts are designated at Group level as hedges of foreign exchange risk
on specific monetary assets, monetary liabilities or future transactions on a gross basis.
The following tables present details of the Group’s sensitivity to reasonably possible increases anddecreases in the Euro and US Dollar against the relevant foreign currencies. In determining reasonably
possible changes, the historical volatility over a 12-month period of the respective foreign currencies
in relation to the Euro and the US Dollar has been considered. The sensitivity analysis determines thepotential gains and losses in the income statement or equity arising from the Group’s foreign exchange
positions as a result of the corresponding percentage increases and decreases in the Group’s main
foreign currencies relative to the Euro and the US Dollar. The sensitivity analysis includes outstanding
foreign-currency denominated monetary items, external loans and loans between operations within
the Group where the denomination of the loan is in a currency other than the functional currencyof the local entity.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
25. Financial risk management and financial instruments continued

2021 exchange risk sensitivity to reasonably possible changes in the US Dollar against relevant
other currencies

2022 exchange risk sensitivity to reasonably possible changes in the Euro against relevant
other currencies% historicalvolatility over a
12-month period

Egyptian Pound
Nigerian Naira
Russian Rouble
UK Sterling
Ukrainian Hryvnia
Other
Total

23.35%
15.54%
54.49%
7.74%
12.52%–

Euro strengthens against
local currency
Loss/(gain)
in incomeLoss/(gain)
statementin equity€ million€ million

4.0
12.9
(9.4)
(1.1)
2.9
2.3
11.6

15.7
–
(0.1)
(0.4)
–
(4.4)
10.8

Euro weakens against
local currency(Gain)/loss
in income(Gain)/loss
statementin equity€ million€ million(6.4)(17.6)
31.9
1.2
(3.8)
(3.1)
2.2

(25.3)
–
0.2
0.2
–
5.1
(19.8)

2022 exchange risk sensitivity to reasonably possible changes in the US Dollar against relevant
other currencies% historicalvolatility over a
12-month periodEuro
Egyptian Pound
Nigerian Naira
Russian Rouble
Ukrainian Hryvnia
Other
Total

10.06%
22.23%
5.94%
52.99%
4.15%–

US Dollar strengthens against
local currency(Gain)/loss
in income(Gain)/loss
statementin equity€ million€ million

(7.2)
9.9
11.0
(18.7)
(0.1)
(0.4)
(5.5)

–
–
–
–
–
–
–

US Dollar weakens against
local currency
Loss/(gain)
in incomeLoss/(gain)
statementin equity€ million€ million

8.8(15.6)(12.4)
61.0
0.1
0.3
42.2

–
–
–
–
–
–
–

2021 exchange risk sensitivity to reasonably possible changes in the Euro against relevant
other currencies% historicalvolatility over a
12-month period

Nigerian Naira
Russian Rouble
UK Sterling
Ukrainian Hryvnia
Other
Total

16.03%
9.90%
5.23%
6.80%
–

Euro strengthens against
local currency
Loss/(gain)
in income(Gain)/loss
statementin equity€ million€ million

6.2
(0.7)
0.9
0.3
(0.2)
6.5

–
(0.2)
–
–
(1.5)
(1.7)

Euro weakens against
local currency(Gain)/loss
in incomeLoss/(gain)
statementin equity€ million€ million

(8.5)
0.9
(1.0)
(0.2)
(0.2)
(9.0)

–
0.3
–
–
1.7
2.0

% historicalvolatility over a
12-month periodEuro
Nigerian Naira
Russian Rouble
Other
Total

5.72%
5.89%
9.86%
–

US Dollar strengthens against
local currency(Gain)/loss
in income(Gain)/loss
statementin equity€ million€ million

(1.8)
0.6
0.1
(0.4)
(1.5)

–
–
(3.2)
–
(3.2)

US Dollar weakens against
local currency
Loss/(gain)
in incomeLoss/(gain)
statementin equity€ million€ million

2.0
(0.5)
(0.1)
0.4
1.8

–
–
3.9
–
3.9

b) Commodity price risk
The Group is affected by the volatility of certain commodity prices (being mainly sugar, aluminium,
aluminium premium, plastic and gas oil) in relation to certain raw materials necessary for the productionof the Group’s products.
Due to the significantly increased volatility of commodity prices, the Group’s Board of Directors hasdeveloped and enacted a risk management strategy regarding commodity price risk and its mitigation.
Although the Group continues to contract prices with suppliers in advance, to reduce its exposure to
the effect of short-term changes in the price of sugar, aluminium, aluminium premium, gas oil andplastic the Group hedges the market price of these commodities using commodity swap contracts
based on a rolling forecast for a period up to 36 months. Group Treasury’s Risk management policy is tohedge a minimum of 25% and a maximum of 80% of commodity exposure for the next 12 months withthe exception of certain types of plastic for which lower compliance ratios apply.
The following table presents details of the Group’s income statement and equity sensitivity to increases
and decreases in sugar, aluminium, aluminium premium, plastic and gas oil prices. The table does notshow the sensitivity to the Group’s total underlying commodity exposure or the impact of changes involumes that may arise from increase or decrease in the respective commodity prices. The sensitivity
analysis determines the potential effect on profit or loss and equity arising from the Group’s commodity
swap contract positions as a result of the reasonably possible increases or decreases of the respective
commodity price.

205

206

Strategic
ReportFinancial
Statements

Corporate
Governance

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
25. Financial risk management and financial instruments continued
2022 commodity price risk sensitivity to reasonably possible changes in the commodity priceof relevant commodities
Commodity price increases withall other variables held constant% historicalvolatility over a
12-month period
per contract
maturity

Sugar
Aluminium
Aluminium premium
Gas oil
Plastic
Total

14.3%
32.3%
70.6%
72.5%
28.1%

Commodity price decreases withall other variables held constant(Gain)/loss
in incomestatement€ million(Gain)/loss
in equity€ million

Loss/(gain)
in incomestatement€ million

Loss/(gain)in equity€ million

(0.9)
(2.1)
(0.2)
–
(8.9)
(12.1)(19.8)(34.3)(5.7)(15.4)–(75.2)

0.9
2.1
0.2
–
8.9
12.1

19.8
34.3
5.7
15.4
–
75.2

2021 commodity price risk sensitivity to reasonably possible changes in the commodity priceof relevant commodities
Commodity price increases withall other variables held constant% historicalvolatility over a
12-month period
per contract
maturity

Sugar
Aluminium
Aluminium premium
Gas oil
Plastic
Total

20.8%
24.1%
46.1%
31.3%
27.0%

Commodity price decreases withall other variables held constant(Gain)/loss
in incomestatement€ million(Gain)/loss
in equity€ million

Loss/(gain)
in incomestatement€ million

Loss/(gain)in equity€ million

(0.4)
(0.8)
(0.2)
–
(25.7)(27.1)(22.6)(19.8)
(3.0)
(5.6)
–
(51.0)

0.4
0.8
0.2
–
25.7
27.1

22.6
19.8
3.0
5.6
–
51.0

c) Interest rate risk
The sensitivity analysis in the following table has been determined based on exposure to interest rates
of both derivative and non-derivative instruments existing at the balance sheet date and assuming
constant foreign exchange rates. For floating rate liabilities, the analysis is prepared assuming theamount of liability outstanding at the balance sheet date was outstanding for the whole year. A 50 basis
point increase or decrease for 2022 (2021: 50 basis point) represents management’s assessment of areasonably possible change in interest rates.
Interest rate risk sensitivity to reasonably possible changes in interest rates
Loss /(gain) in income statement
2022
2021
€ million€ million

Increase in basis points
Decrease in basis points

0.3
(0.3)

0.2
(0.2)

Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument
fails to meet its obligations under the contract or arrangement. The Group has limited concentration of
credit risk across trade and financial counterparties. Credit policies are in place and the exposure tocredit risk is monitored on an ongoing basis.
The Group’s maximum exposure to credit risk in the event that counterparties fail to meet their
obligations at 31 December 2022 in relation to each class of recognised financial asset is the carrying
amount of those assets as indicated on the balance sheet.
Under the credit policies, before accepting any new credit customers, the Group investigates thepotential customer’s credit quality, using either external agencies and in some cases bank references
and/or historic experience, and defines credit limits for each customer. Customers that fail to meet theGroup’s benchmark credit quality may transact with the Group only on a prepayment or cash basis.
Customers are reviewed on an ongoing basis and credit limits are adjusted accordingly. There is no
significant concentration of credit risk with regard to loans, trade and other receivables as the Group
has a large number of customers which are geographically dispersed.
The Group has policies that limit the amount of credit exposure to any single financial institution. The
Group only undertakes investment and derivative transactions with banks and financial institutions thathave a minimum credit rating of ‘BBB-’ from Standard & Poor’s and ‘Baa3’ from Moody’s, unless theinvestment is in countries where the Sovereign Credit Rating is below the ‘BBB-/Baa3’. The Group alsouses Credit Default Swaps of a counterparty in order to measure in a timelier way the creditworthinessof a counterparty and set up its counterparties in tiers in order to assign maximum exposure and tenor
per tier. If the Credit Default Swaps of a certain counterparty exceed 400 basis points the Group willstop trading derivatives with that counterparty and will try to cancel any deposits on a best-effort basis.
In addition, the Group regularly makes use of time deposits, treasury bills and money market funds toinvest excess cash balances and to diversify its counterparty risk. As at 31 December 2022, an amountof €529.5 million (2021: €423.9 million) is invested in time deposits, €nil in treasury bills (2021: €6.2
million) and €497.2 million (2021: €638.8 million) in money market funds.

Liquidity risk
The Group actively manages liquidity risk to ensure there are sufficient funds available for any shortterm and long-term commitments. Bank overdrafts and bank facilities, both committed anduncommitted, are used to manage this risk.
The Group manages liquidity risk by maintaining adequate cash reserves and committed banking
facilities, access to the debt and equity capital markets, and by continuously monitoring forecast andactual cash flows. In Note 26, the undrawn facilities that the Group has at its disposal to manage liquidity
risk are discussed under the headings ‘Commercial paper programme’, ‘Committed credit facilities’ and‘Uncommitted loan agreement’.
As at 31 December 2022, the Group has a net debt of €1.7 billion (refer to Note 26). There are no bondmaturities until November 2024. In addition, the Group has an undrawn revolving credit facility of €800
million available, €0.8 billion available out of the €1.0 billion commercial paper facility, as well as undrawn
uncommitted loan agreement of €200 million.
The following tables detail the Group’s remaining contractual maturities for its financial liabilities. The
tables include both interest and principal undiscounted cash flows, assuming that interest rates remain
constant from 31 December 2022.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
25. Financial risk management and financial instruments continued
Borrowings
Derivative liabilities
Trade and other payables (excluding othertax & social security and contract liabilities)
Leases
As at 31 December 2022

Borrowings
Derivative liabilities
Trade and other payables (excluding othertax & social security and contract liabilities)
Leases
As at 31 December 2021

Up to
one year€ million

One totwo years€ million

Two tofive years€ millionOverfive years€ million

Total€ million

314.4
41.9

657.9
3.5

1,310.1
0.2

1,145.3–

3,427.7
45.6

2,158.0
67.2
2,581.5

0.4
55.5
717.3

1.1
85.6
1,397.0

3.8
49.1
1,198.2

2,163.3
257.4
5,894.0

Up to
one year€ million

One totwo years€ million

Two tofive years€ millionOverfive years€ million

Total€ million

365.2
11.6

48.4
3.0

707.3
–

1,875.2–

2,996.1
14.6

1,748.058.9
2,183.7

0.4
43.2
95.0

1.1
62.9
771.3

4.1
29.6
1,908.9

1,753.6
194.6
4,958.9

Capital risk
The Group monitors its financial capacity and credit ratings by reference to a number of key financial
ratios including net debt to comparable adjusted EBITDA, which provides a framework within which
the Group’s capital base is managed. This ratio is calculated as net debt divided by comparable
adjusted EBITDA.
Adjusted EBITDA is calculated by adding back to operating profit the depreciation and impairment ofproperty, plant and equipment, the amortisation and impairment of intangible assets, the employee
performance share costs, the impairment of equity method investments and other non-cash items,
if any. Comparable adjusted EBITDA refers to adjusted EBITDA excluding restructuring expenses,
the Russia-Ukraine conflict impact, acquisition and integration costs and the unrealised gains orlosses resulting from the mark-to-market valuation of derivatives and embedded derivatives related
to commodity hedging.
Refer to Note 26 for definition of net debt.
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as agoing concern and to maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may increase or decrease debt, issue or
buy back shares, adjust the amount of dividends paid to shareholders, or return capital to shareholders.

The Group’s goal is to maintain a conservative financial profile. This is evidenced by the credit ratings
maintained with Standard and Poor’s and Moody’s, which were reaffirmed in 2022, with the exception ofStandard and Poor’s outlook, which was negative in 2022 compared to stable in 2021.
Rating agency

Publication dateLong-term debt

Outlook

Short-term debt

Standard and Poor’s
Moody’sMarch 2022
May 2022

BBB+
Baa1

Negative
StableA2
P2

The Group’s medium to long-term target is to maintain the net debt to comparable adjusted EBITDA
ratio within a 1.5 to 2.0 range.
The ratios as at 31 December were as follows:

Net debt (refer to Note 26)
Operating profit
Depreciation and impairment of property, plant and equipment,
including right-of-use assets
Amortisation and impairment of intangible assets
Employee performance shares
Impairment of equity method investments
Other non-cash items
Adjusted EBITDA
Other restructuring expenses (primarily redundancy costs)
Unrealised loss/(gain) on commodity derivatives
Russia-Ukraine conflict impact (refer to Note 6.1b)Acquisition and integration costs
Total comparable adjusted EBITDA
Net debt/comparable adjusted EBITDA ratio

2022€ million

2021€ million

1,673.3
703.8

1,319.7
799.3

484.9
15.1
16.5
52.8
70.5
1,343.6
11.8
2.5
4.4
9.2
1,371.5
1.22

336.3
1.0
14.9
–
–
1,151.5
21.0
(3.8)
–
14.3
1,183.0
1.12

Other non-cash items for 2022 relate to the net loss recognised in the income statement from theremeasurement to fair value of the Group’s previously held equity interest, the reclassification to theincome statement of the Group’s share of other comprehensive income and the gain from bargain
purchase in connection with the change in control of Multon Z.A.O. group of companies (refer to Note 24).
These non-cash items were classified as part of acquisition and integration costs within operating expenses.
The reconciliation of other restructuring expenses to total restructuring expenses for the years ended
31 December was as follows:

Total restructuring expenses included in operating expenses(refer to Note 9)
Less: Impairment of property, plant and equipment
Other restructuring expenses (primarily redundancy costs)

2022€ million

2021€ million

11.9
(0.1)
11.8

21.2
(0.2)
21.0

207

208

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
25. Financial risk management and financial instruments continued

The impact on the hedging reserve as a result of applying cash flow hedge accounting was:

Hedging activity
The carrying amounts of the derivative financial instruments are included in lines ‘Other financial assets’and ‘Other financial liabilities’ of the consolidated balance sheet.

a) Cash flow hedges
The impact of the hedging instruments on the consolidated balance sheet was:Notional amount€ million

Carrying amount€ million

Contracts with positive fair values
Non-current
Commodity swap contracts
Current
Foreign currency forward contracts
Commodity swap contracts

172.6
24.1
24.1
148.5
61.6
86.9

19.2
0.8
0.8
18.4
0.4
18.0

Contracts with negative fair values
Non-current
Commodity swap contracts
Current
Foreign currency forward contracts
Commodity swap contracts

221.3
54.7
54.7
166.6
66.6
100.0

(14.4)(3.6)(3.6)(10.8)(0.8)(10.0)

Notional amount€ million

Carrying amount€ million

Contracts with positive fair values
Non-current
Commodity swap contracts
Current
Foreign currency forward contracts
Commodity swap contracts

182.6
26.8
26.8
155.8
48.3
107.5

40.4
9.0
9.0
31.4
1.3
30.1

Contracts with negative fair values
Non-current
Commodity swap contracts
Current
Foreign currency forward contracts
Commodity swap contracts

59.3
2.5
2.5
56.8
37.9
18.9

(1.2)
(0.1)
(0.1)
(1.1)
(0.6)
(0.5)

As at 31 December 2022

As at 31 December 2021

Period ofmaturity date

Jan24 – Feb25
Jan23 – Sep23
Jan23 – Dec23

Jan24 – Nov25
Jan23 – Jun23
Jan23 – Dec23
Period ofmaturity date

Jan23 – Nov23
Jan22 – Aug22
Jan22 – Dec22

Jan23 – Nov23
Jan22 – Dec22
Jan22 – Nov22

Opening balance 1 January 2021
Net gain of cash flow hedges
Change in fair value of hedging
instruments recognised in OCI
Reclassified to income statement
Cost of hedging recognised in OCI
Reclassified to inventories cost
Closing balance 31 December 2021
Net gain of cash flow hedges
Change in fair value of hedging
instruments recognised in OCI
Reclassified to income statement
Cost of hedging recognised in OCI
Reclassified to inventories cost
Closing balance 31 December 2022

Spot
component offoreigncurrency
forwardcontracts€ million

Cost ofhedging
reserve of
currency
derivatives€ million

Commodity
swap
contracts€ million

Interest rate
swap
contracts€ million

Total€ million

(1.6)
1.0

0.7
–

6.5
60.8

(32.5)
7.7(26.9)
69.5

1.0
–
–
(0.8)
(1.4)
4.8

–
–
(2.7)
2.4
0.4
–

60.8
–
–
(25.6)
41.7
17.4

–
7.7
–
–
(24.8)
12.4

61.8
7.7
(2.7)
(24.0)
15.9
34.6

4.8
–
–
(5.1)
(1.7)

–
–
(1.8)
1.8
0.4

20.6
(3.2)
–
(48.1)
11.0

5.1
7.3
(1.7)
–
(14.1)

30.5
4.1
(3.5)
(51.4)(4.4)

The effect of the cash flow hedges in the consolidated income statement was:

Net amount reclassified from other comprehensive income
to cost of goods soldNet amount reclassified from other comprehensive income
to finance costs
Total

2022
(Gain)/Loss€ million

2021
Loss/(Gain)€ million

(3.2)

–

7.3
4.1

7.7
7.7

The ineffectiveness on the cash flow hedges for the year ended 31 December 2022 was €2.6 million
loss, recorded within cost of goods sold, while there was no significant ineffectiveness on the cash flow
hedges in 2021.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
25. Financial risk management and financial instruments continuedb) Undesignated hedges
The fair values of derivative financial instruments as at 31 December which economically hedge theGroup’s risks and for which hedge accounting has not been applied were:
Notional amount€ million

Carrying amount€ million

Contracts with positive fair values
Current
Foreign currency futures contracts
Foreign currency forward contracts
Commodity swap contracts

276.4
276.4
146.8
117.9
11.7

16.9
16.9
3.9
10.7
2.3

Contracts with negative fair values
Non-current
Commodity swap contracts
Current
Foreign currency futures contracts
Foreign currency forward contracts
Commodity swap contracts

552.8
3.6
3.6
549.2
84.1
433.8
31.3

(31.2)(0.1)(0.1)(31.1)(2.5)(21.9)(6.7)

Notional amount€ million

Carrying amount€ million

Period ofmaturity date

Contracts with positive fair values
Current
Embedded derivatives
Foreign currency forward contracts
Commodity swap contracts

203.2
203.2
4.9
165.3
33.0

7.8
7.8
0.1
1.1
6.6

Jan22-Aug22
Jan22-Nov22
Jan22-Dec22

Contracts with negative fair values
Non-current
Foreign currency futures contracts
Commodity swap contracts
Current
Foreign currency futures contracts
Foreign currency forward contracts
Commodity swap contracts

431.3
33.4
13.9
19.5
397.9
94.7
246.5
56.7

(13.4)
(2.9)
(0.6)
(2.3)
(10.5)
(3.3)
(2.6)
(4.6)

As at 31 December 2022

As at 31 December 2021

Categories of financial instruments as at 31 December were as follows (in € million):
2022
Analysis of total assets

Period ofmaturity date

Jan23 – Nov23
Jan23 – Dec23
Oct23 – Dec23

Jun24 – Sep 25

AssetsInvestments including loans
to related parties
Derivative financial
instruments
Trade and other receivables
Cash and cash equivalents
Total

Debt
financialassets at
amortised
cost

Derivatives
designated
Assets at as hedging
FVTPL instruments

Equityfinancial
Total
assets at current andFVOCI non-current

Current

Noncurrent

534.8

498.7

–

3.6

1,037.1

1,028.5

8.6–
1,019.3
719.9
2,274.0

16.9
–
–
515.6

19.2
–
–
19.2

–
–
–
3.6

36.1
1,019.3
719.9
2,812.4

35.3
1,017.0719.9
2,800.7

0.8
2.3
–
11.7

Analysis of total liabilities

Apr23 – Dec23
Jan23 – Dec23
Feb23 – Nov23

Jan23
Jan23-Nov23
Apr22-Oct22
Jan22-Nov22
Jan22-Nov22

The effect of the undesignated hedges in the consolidated income statement was:

Net amount recognised in cost of goods soldNet amount recognised in operating expenses
Total

Financial instruments’ categories

2022(Gain)/loss€ million

2021(Gain)/loss€ million(34.9)(26.0)(60.9)(14.1)(4.4)(18.5)

Liabilities
Trade and other payables (excluding
other tax & social security andcontract liabilities)
Borrowings
Derivative financial instruments
Total

Liabilities
Derivatives
held atdesignatedTotal
amortised Liabilities at as hedging current andcost
FVTPL instruments non-current

2,163.3
3,419.9–
5,583.2

–
–
31.2
31.2

–
–
14.4
14.4

2,163.3
3,419.9
45.6
5,628.8

Current

Noncurrent

2,158.0337.0
41.9
2,536.9

5.3
3,082.9
3.7
3,091.9209

210Strategic
ReportFinancial
Statements

Corporate
Governance

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
25. Financial risk management and financial instruments continued
2021
Analysis of total assets

AssetsInvestments including loans
to related parties
Derivative financial
instruments
Trade and other receivables
Cash and cash equivalents
Total

Debt
financialassets at
amortised
cost

Derivatives
designated
Assets at as hedging
FVTPL instruments

Equityfinancial
Total
assets at current andFVOCI non-current

Current

Noncurrent

204.9

638.8

–

3.6

847.3

839.7

7.6

–
863.3
782.8
1,851.0

7.8
–
–
646.6

40.4
–
–
40.4

–
–
–
3.6

48.2
863.3
782.8
2,541.6

39.2
862.2
782.8
2,523.9

9.0
1.1
–
17.7

Analysis of total liabilities

Liabilities
Trade and other payables (excluding
other tax & social security andcontract liabilities)
Borrowings
Derivative financial instruments
Total

Liabilities
Derivatives
held atdesignatedTotal
amortised Liabilities at as hedging current andcost
FVTPL instruments non-current

1,753.6
2,937.4–
4,691.0

–
–
13.4
13.4

–
–
1.2
1.2

1,753.6
2,937.4
14.6
4,705.6

The Group entered into swaption contracts of €180.0 million in 2022 to hedge the interest rate risk
related to its Euro-denominated forecast issuance of fixed rate debt in 2022 and formally designatedthem as cash flow hedges. In September 2022 the swaption contracts were settled and, at the sametime, the new notes were issued. The accumulated gain of €3.4 million recorded in other comprehensive
income is being amortised to the income statement over the relevant period.

Embedded derivatives
During 2015 the Group recognised embedded derivatives whose risks and economic characteristics
were not considered to be closely related to the commodity contract in which they were embedded.
The fair value of the embedded derivatives as at 31 December 2022 amounted to a financial assetof €nil (2021: €0.1 million).

Fair values of financial assets and liabilities
For financial instruments such as cash, deposits, debtors and creditors, investments, loans payable
to related parties, short-term borrowings (excluding the current portion of bonds and notes payable)
and other financial liabilities (other than bonds and notes payable), carrying values are a reasonableapproximation of their fair values. According to the fair value hierarchy, the financial instruments
measured at fair value are classified as follows:

Current

Noncurrent

Level 1
The fair value of FVOCI listed equity securities as well as FVTPL securities is based on quoted market
prices at the reported date. The fair value of bonds is based on quoted market prices at the reported date.

1,748.0
381.7
11.6
2,141.3

5.6
2,555.7
3.0
2,564.3

Level 2
The fair value of foreign currency forward, option and futures contracts, commodity swap contracts,
bonds and notes payable, interest rate option and swap contracts, cross-currency swap contracts andembedded foreign currency derivatives is determined by using valuation techniques. These valuation
techniques maximise the use of observable market data. The fair value of the foreign currency forward,
option and futures contracts, commodity swap contracts, embedded foreign currency derivatives andcross-currency swap contracts is calculated by reference to quoted forward exchange and deposit
rates and forward rate curves of the underlying commodity at the reported date for contracts withsimilar maturity dates. The fair value of interest rate option contracts is calculated by reference to theBlack-Scholes valuation model and implied volatilities. The fair value of interest rate swap contracts isdetermined as the difference in the present value of the future interest cash inflows and outflows basedon observable yield curves.

Interest rate swap contracts
The Group entered into forward starting swap contracts of €500.0 million in 2014 to hedge the interest
rate risk related to its Euro-denominated forecast issuance of fixed rate debt in March 2016. In August
2015 the Group entered into additional forward starting swap contracts of €100.0 million. In March 2016
the forward starting swap contracts were settled and at the same time the new note was issued. The
accumulated loss of €55.4 million recorded in other comprehensive income is being amortised to theincome statement over the term of the new note (refer to Note 26).
The Group entered into swaption contracts of €350.0 million in 2018 and €1,050.0 million in 2019 tohedge the interest rate risk related to its Euro-denominated forecast issuance of fixed rate debt in 2019and formally designated them as cash flow hedges. In May and November 2019 the swaption contracts
were settled and, at the same time, the new notes were issued. The accumulated loss of €9.6 million
recorded in other comprehensive income is being amortised to the income statement over the
relevant period.

Level 3
The fair value of FVOCI unlisted equity securities as well as convertible promissory note, certain
undesignated derivatives and foreign currency contracts is determined through the use of estimateddiscounted cash flows or other valuation techniques. These valuation techniques estimate the fair valueof undesignated derivatives using settlement and forward prices received from counterparty banks
and subscription-based publications and the fair value of foreign currency contracts by using adjusted
quoted prices.
Transfers between levels of the fair value hierarchy are deemed to have occurred at the date of theevent or change in circumstances that caused the transfer.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
25. Financial risk management and financial instruments continued
The following table provides the fair value hierarchy levels into which fair value measurements are
categorised for assets and liabilities measured at fair value as at 31 December 2022:

Financial assets at FVTPL
Foreign currency forward contracts
Foreign currency futures contracts
Commodity swap contracts
Money market funds
Convertible promissory note
Derivative financial assets used for hedging
Cash flow hedges
Foreign currency forward contracts
Commodity swap contracts
Assets at FVOCI
Equity securities
Total financial assets
Financial liabilities at FVTPL
Foreign currency forward contracts
Foreign currency futures contracts
Commodity swap contracts
Derivative financial liabilities used for hedging
Cash flow hedges
Foreign currency forward contracts
Commodity swap contracts
Total financial liabilities

Level 1€ million

Level 2€ million

Level 3€ million

Total€ million

–
–
–
497.2
–

10.7
–
0.2
–
–

–
3.9
2.1
–
1.5

10.7
3.9
2.3
497.2
1.5

–
–

0.4
18.8

–
–

0.4
18.8

0.7
497.9

–
30.1

2.9
10.4

3.6
538.4

–
–
–

(18.2)
–
(0.9)

(3.7)
(2.5)
(5.9)

(21.9)
(2.5)
(6.8)

–
–
–

(0.8)
(13.6)(33.5)––(12.1)(0.8)(13.6)(45.6)

There were no transfers between Level 1, Level 2 and Level 3 in the year.

The following table provides the fair value hierarchy levels into which fair value measurements are
categorised for assets and liabilities measured at fair value as at 31 December 2021:

Financial assets at FVTPL
Foreign currency forward contracts
Embedded derivatives
Commodity swap contracts
Money market funds
Derivative financial assets used for hedging
Cash flow hedges
Foreign currency forward contracts
Commodity swap contracts
Assets at FVOCI
Equity securities
Total financial assets
Financial liabilities at FVTPL
Foreign currency forward contracts
Foreign currency futures contracts
Commodity swap contracts
Derivative financial liabilities used for hedging
Cash flow hedges
Foreign currency forward contracts
Commodity swap contracts
Total financial liabilities

Level 1€ million

Level 2€ million

Level 3€ million

Total€ million

–
–
–
638.8

1.1
0.1
0.6
–

–
–
6.0
–

1.1
0.1
6.6
638.8

–
–

1.3
39.1

–
–

1.3
39.1

0.7
639.5

–
42.2

2.9
8.9

3.6
690.6

–
–
–

(2.6)
–
–

–
(3.9)
(6.9)

(2.6)
(3.9)
(6.9)

–
–
–

(0.6)
(0.6)
(3.8)

–
–
(10.8)(0.6)(0.6)(14.6)

There were no transfers between Level 1, Level 2 and Level 3 in 2021.
The following table presents the changes in Level 3 items for the years ended 31 December 2022 and
31 December 2021:

Balance as at 1 January 2021
Gains recognised in income statement
Proceeds from settlement of derivatives
Gains recognised in other comprehensive
incomeBalance as at 31 December 2021
Gains/(losses) recognised in income statement(Proceeds from)/payments for settlementof derivatives
Addition of financial assets at FVTPL
Balance as at 31 December 2022

Commodity
swap
contracts€ million

Foreigncurrency
contracts€ million

Equitysecurities€ million

Convertible
promissorynote€ million

Total€ million

(5.8)
13.6
(8.7)

4.9
0.4
(9.2)

2.8
–
–

­­–
–
–

1.9
14.0
(17.9)

–
(0.9)
19.1

–
(3.9)
(1.7)

0.1
2.9
–

­–
­
–

0.1
(1.9)
17.4

(22.0)
–
(3.8)

3.3
–
(2.3)

–
–
2.9

–
1.5
1.5

(18.7)
1.5
(1.7)

211

212

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
26. Net debta) Borrowings
The Group held the following borrowings as at 31 December:

Accounting policy
Borrowings are initially recognised at the fair value net of transaction costs incurred.
After initial recognition, all interest-bearing borrowings are subsequently measured at amortised
cost. Amortised cost is calculated using the effective interest rate method whereby any discount,premium or transaction costs associated with a borrowing are amortised to the income statement
over the borrowing period.
Refer also to Note 17 for accounting policy on leases.
Cash and cash equivalents comprise cash balances and short-term, highly liquid investments thatare readily convertible to known amounts of cash and which are subject to insignificant risk of change
in value. Bank overdrafts are classified as short-term borrowings in the balance sheet and for the
purpose of the cash flow statement. Time deposits and treasury bills which do not meet thedefinition of cash and cash equivalents are classified as short-term investments at amortised cost.
Money market funds are classified as short-term investments at fair value through profit or loss.
The Group has elected to report cash receipts and payments regarding investments at amortised
cost and fair value through profit or loss respectively, on a net basis in the consolidated cash flow
statement, considering that the relevant amounts are large, turnover is quick and maturities areshort. These investments are expected to be continually renewed, taking into account market
returns and cash generation by the Group.
Net debt is defined as current borrowings plus non-current borrowings less cash and cash
equivalents, and certain other financial assets.
Net debt for the year ended 31 December comprised:

Current borrowings
Non-current borrowings
Less: Cash and cash equivalents• Financial assets at amortised cost
• Financial assets at fair value through profit or loss
Less: Other financial assets
Net debt

2022€ million

2021€ million

337.0
3,082.9(719.9)(529.5)(497.2)(1,026.7)
1,673.3

381.7
2,555.7(782.8)(196.1)(638.8)(834.9)1,319.7

The financial assets at amortised cost include time deposits amounting to €529.5 million (31 December
2021: €189.9 million) as well as Nigerian treasury bills of €nil (31 December 2021: €6.2 million). The
financial assets at fair value through profit or loss in 2022 relate to money market funds. The line item
‘Other financial assets’ of the consolidated balance sheet includes derivative financial instrumentsof €35.3 million (31 December 2021: €39.2 million) and related party loans receivable of €1.8 million(31 December 2021: €4.8 million).

Commercial paper
Loans payable to related parties (refer to Note 28)
Other borrowings
Obligations under leases falling due within one year
Total borrowings falling due within one year
Borrowings falling due within one to two years
Bonds, bills and unsecured notes
Loans payable to related parties (refer to Note 28)
Borrowings falling due within two to five years
Bonds, bills and unsecured notes
Borrowings falling due in more than five years
Bonds, bills and unsecured notes
Other borrowings
Obligations under leases falling due in more than one year
Total borrowings falling due after one year
Total borrowings

2022€ million

2021€ million

167.5
–
115.6
283.1
53.9
337.0

235.0
58.1
37.7
330.8
50.9
381.7

599.0
–

–
5.1

1,192.5

598.5

1,091.947.4
2,930.8
152.1
3,082.9
3,419.9

1,787.2
55.5
2,446.3
109.4
2,555.7
2,937.4

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
26. Net debt continued

The ‘Other non-cash movements’ primarily include transfers from long-term to short-term liabilities
and interest incurred as well as the decrease to borrowings in 2022, resulting from the change in controlof Multon (refer to Note 16).

Reconciliation of liabilities to cash flows arising from financing activities:
Borrowings
Due within Due in more
one year than one year
€ million€ million

Balance as at 1 January 2021
Cash flows
Proceeds from borrowings
Repayments of borrowings
Principal repayments of leaseobligations
Interest paid
Proceeds from/(payments for)settlement of derivatives regarding
financing activities
Total cash flows
Leases increase
Effect of changes in exchange rates
Other non-cash movements
Balance as at 31 December 2021
Cash flows
Proceeds from borrowings
Repayments of borrowings
Principal repayments of leaseobligations
Interest paid
Proceeds from/settlementof derivatives regarding
financing activities
Total cash flows
Leases increase
Arising from businesscombinations
Effect of changes in exchange rates
Other non-cash movements
Balance as at 31 December 2022

LeasesDue within Due in more
one year than one year
€ million€ million

Derivative
assets/(liabilities)€ million

Total€ million

Commercial paper programme

260.4

2,480.9

54.8

129.4

–

2,925.5

77.0(102.6)52.3(31.2)

–
–

–
–

–
–

129.3
(133.8)–(36.2)––(63.1)
(9.3)

–
–

–
–

(63.1)(45.5)In October 2013 the Group established a €1.0 billion Euro-commercial paper programme (the ‘CP
programme’), which was updated in September 2014, in May 2017 and then in May 2020, to further
diversify its short-term funding sources. The Euro-commercial paper notes may be issued either as
non-interest-bearing notes sold at a discount or as interest-bearing notes at a fixed or floating rate.
All commercial paper issued under the CP programme must be repaid within 7 to 364 days. The CP
programme has been granted the Short Term Euro Paper label (STEP) and commercial paper is issued
through Coca-Cola HBC’s fully owned subsidiary Coca-Cola HBC Finance B.V. and is fully, unconditionallyand irrevocably guaranteed by Coca-Cola HBC AG. The outstanding amount under the CP programme
as at 31 December 2022 was €167.5 million (2021: €235.0 million).

Committed credit facilities–(61.8)
–
0.2
132.0
330.8

–
21.1
–
0.2
(55.9)
2,446.3–(72.4)
0.8
0.4
67.3
50.9

–
–
41.2
1.0
(62.2)
109.4

4.9
4.9
–
–
(2.6)
2.3

4.9
(108.2)
42.0
1.8
78.6
2,939.7

150.0(358.2)

500.0
(0.4)

–
–

–
–

–
–

650.0
(358.6)–(40.9)–(5.2)(65.2)(14.3)––––(65.2)(60.4)–(249.1)
–

–
494.4
–

–
(79.5)
0.9

–
–
90.3

0.1
0.1
–

0.1
165.9
91.2

179.3
(15.5)
37.6
283.1

–
(0.9)
(9.0)
2,930.8

5.0
(1.6)
78.2
53.9

34.0
(12.0)(69.6)
152.1

–
–
(5.7)
(3.3)

218.3
(30.0)
31.5
3,416.6

In April 2019, the Group updated its then-existing €500.0 million syndicated revolving credit facility,
which was set to expire in June 2021. The updated syndicated revolving credit facility has been
increased to €800.0 million and has been extended to April 2024 with the option to be extended up
to two more years until April 2026. In March 2020, the Company exercised its extension option and thefacility was extended to April 2025. In April 2021, the Company exercised its second option to further
extend the maturity of the syndicated loan facility to April 2026. This facility can be used for general
corporate purposes and carries a floating interest rate over EURIBOR. No amounts have been drawn
under the syndicated revolving credit facility since inception. The borrower in the syndicated revolving
credit facility is Coca-Cola HBC’s fully owned subsidiary Coca-Cola HBC Finance B.V. and any amounts
drawn under the facility are fully, unconditionally and irrevocably guaranteed by Coca-Cola HBC AG.
In December 2019 the Group established a loan facility of US Dollar 85.0 million to finance the purchaseof production equipment by the Group’s subsidiary in Nigeria. The facility has been drawn down by
Nigerian Bottling Company (NBC) over the course of 2020 and 2021 maturing in 2027. The obligations
under this facility are guaranteed by Coca-Cola HBC AG. As at 31 December 2022, the outstanding
liability amounted to €59.3 million (2021: €63.2 million).

Uncommitted loan agreement
In August 2022, the Group established an uncommitted money market loan agreementof €250.0 million which was subsequently reduced to €200.0 million from October 2022 onwards.
The loan agreement can be used for general corporate purposes. No amounts have been drawn underthe money market loan agreement since its inception. The borrower in the money market loan
agreement is Coca Cola HBC’s fully owned subsidiary Coca-Cola HBC Finance B.V.

213

214

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
26. Net debt continued

Total borrowings at 31 December were held in the following currencies:

Euro medium-term note programme
In June 2013, the Group established a new €3.0 billion Euro medium-term note programme (the ‘EMTN
programme’). The EMTN programme was updated in September 2014, September 2015, April 2019,
when it was increased to €5.0 billion, April 2020, September 2021 and then September 2022. Notes areissued under the EMTN programme through Coca-Cola HBC’s fully-owned subsidiary Coca-Cola HBC
Finance B.V. and are fully, unconditionally and irrevocably guaranteed by Coca-Cola HBC AG.
In March 2016, Coca-Cola HBC Finance B.V. completed the issue of a €600 million Euro-denominated
fixed rate bond maturing in November 2024. The coupon rate of the bond is 1.875%, which, including
the amortisation of the loss on the forward starting swap contracts over the term of the fixed rate bond,results in an effective interest rate of 2.99%. The net proceeds of the new issue were used to partially
repay €214.6 million of the 4.25%, €600 million seven-year fixed rate notes due in November 2016.
The remaining €385.4 million was repaid in November 2016 upon its maturity.
In May 2019, Coca-Cola HBC Finance B.V. completed the issue of a €700 million Euro-denominated
fixed rate bond maturing in May 2027 with a coupon rate of 1% and the issue of a €600 million Eurodenominated fixed rate bond maturing in May 2031 with a coupon rate of 1.625%. The net proceedsof the new issue were used to partially repay €236.6 million of the 2.375%, €800 million seven-year fixed
rate bond due in June 2020, while the remaining €563.4 million was repaid in June 2020 upon its maturity.
In November 2019, Coca-Cola HBC Finance B.V. completed the issue of a €500 million Euro-denominated
fixed rate bond maturing in November 2029 with a coupon rate of 0.625%.
In September 2022, Coca-Cola HBC Finance B.V. completed the issue of a €500 million Euro-denominated
fixed rate green bond maturing in September 2025 with a coupon rate of 2.75%.

Euro
US Dollar
Egyptian Pound
Nigerian Naira
Swiss Franc
Bulgarian Lev
Russian Rouble
UK Sterling
Czech Koruna
Polish Zloty
Romanian Leu
Hungarian Forint
Belarusian Rouble
Bosnian Mark
Croatian Kuna
Other
Total borrowings

Note(in million) Start date

€600
€700
€600
€500
€500
Total

Maturity date

10 March 2016
11 November 2024
14 May 201914 May 2027
14 May 201914 May 2031
21 November 2019 21 November 2029
23 September 2022 23 September 2025

Fixed
coupon1.875%
1.000%
1.625%
0.625%
2.750%

Book value
2022
2021
€ million€ million

599.0
697.1
596.5
495.4
495.4
2,883.4

598.5
696.5
596.0
494.7
–
2,385.7

Fair value
2022
2021
€ million€ million

582.0
626.6
497.1
403.9
486.0
2,595.6

631.8
717.8
640.7
496.2
–
2,486.5

The weighted average effective interest rate of the Euro-denominated fixed rate bonds is 1.89% andthe weighted average maturity is 4.9 years. The fair values are within Level 1 of the value hierarchy.
None of our debt facilities are subject to any financial covenants that would impact the Group’s liquidity
or access to capital.

2021€ million

237.6
34.3
39.3
9.6
4.5
2.6
2.2
1.7
1.3
1.2
1.4
0.5
0.1
0.3
0.1
0.3
337.0

289.5
13.7
–
7.5
4.6
2.2
57.6
2.1
1.5
0.8
0.9
0.6
–
0.4
0.1
0.2
381.7

Non-current
2022€ million

2,946.6
64.4
23.5
23.3
4.7
4.6
4.8
2.4
2.6
2.6
1.5
0.5
0.8
–
–
0.6
3,082.92021€ million

2,438.8
73.5
–
15.5
4.4
5.0
5.0
4.4
5.3
0.8
0.7
0.4
0.8
0.3
–
0.8
2,555.7

The carrying amounts of interest-bearing borrowings held at fixed and floating interest rates as at 31
December 2022 were as follows:

As at 31 December 2022, a total of €2.9 billion in notes issued under the EMTN programme
were outstanding.
Summary of notes outstanding as at 31 December

Current
2022€ millionEuro
US Dollar
Egyptian Pound
Nigerian Naira
Swiss Franc
Bulgarian Lev
Russian Rouble
UK Sterling
Czech Koruna
Polish Zloty
Romanian Leu
Hungarian Forint
Belarusian Rouble
Bosnian Mark
Croatian Kuna
Other
Total interest-bearing borrowings

Fixedinterest rate
€ million

Floating
interest rate
€ million

Total€ million

3,144.1
78.6
62.8
32.9
9.2
7.2
7.0
0.5
3.9
3.8
2.3
1.0
0.9
0.3
0.1
0.9
3,355.5

40.1
20.1
–
–
–
–
–
3.6
–
–
0.6
–
–
–
–
–
64.4

3,184.2
98.7
62.8
32.9
9.2
7.2
7.0
4.1
3.9
3.8
2.9
1.0
0.9
0.3
0.1
0.9
3,419.9

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
26. Net debt continuedb) Cash and cash equivalents
Cash and cash equivalents as at 31 December comprise the following:

Cash at bank, in transit and in hand
Short-term deposits
Total cash and cash equivalents

2022€ million

2021€ million

426.4
293.5
719.9

548.8
234.0
782.8

2022
€ million

2021€ million

348.9
120.9
96.4
51.9
16.6
14.6
9.2
8.8
8.3
7.0
6.6
6.1
4.4
4.1
2.6
2.3
0.6
10.6
719.9

518.4
161.4
9.5
8.4
7.3
28.1
6.0
6.5
5.8
5.8
7.2
–
0.7
3.3
2.2
0.8
6.5
4.9
782.8

Cash and cash equivalents are held in the following currencies:Euro
Nigerian Naira
Russian Rouble
US Dollar
Swiss Franc
Polish Zloty
Romanian Leu
Moldovan Leu
Belarusian Rouble
Serbian Dinar
Ukrainian Hryvnia
Egyptian Pound
Croatian Kuna
Bosnian MarkUK Sterling
Czech Koruna
Hungarian Forint
Other
Total cash and cash equivalents

As at 31 December 2022, time deposits of €529.5 million (2021: €189.9 million), which do not meet thedefinition of cash and cash equivalents, and investment in Nigerian Treasury Bills of €nil (2021: €6.2 million),
which relates to the outstanding balance held for the repayment of Nigerian Bottling Company former
minority shareholders following the 2011 acquisition of non-controlling interests, are recorded asother financial assets.
Cash and cash equivalents of €120.9 million (2021: €161.4 million) equivalent in Nigerian Naira include
an amount of €10.6 million (2021: €8.9 million), which relates to the outstanding balance held for the
repayment of Nigerian Bottling Company former minority shareholders, following the 2011 acquisitionof non-controlling interests.

The amount of dividends payable to the Company by its operating subsidiaries is subject to, among
other restrictions, general limitations imposed by the corporate laws and exchange control restrictionsof the respective jurisdictions where those subsidiaries are organised and operate. Also, there are fundtransfer restrictions in certain countries in which we operate, in particular Belarus, Nigeria, Serbia andUkraine, however these restrictions do not have a material impact on the Group’s liquidity, as the amountsof cash and cash equivalents held in such countries are generally retained for capital expenditure, working
capital and dividend distribution purposes. Intra-group dividends paid by certain of our subsidiaries arealso subject to withholding taxes.
As a result of sanctions and other regulations implemented in 2022, there have been changes inrequired regulatory approvals, potentially impacting the transfer and usage of cash outside of Russia.
Cash and cash equivalents held by the Group’s operations in Russia amounted to €155.3 million
equivalent in Russian Rouble, US Dollar and Euro as at 31 December 2022. The aforementioned
changes restrict the usage of cash held in Russia outside the country, however they are not expected tohave a material impact on the Group’s liquidity, as the cash and cash equivalents held in Russia are
expected to be used in the forthcoming financial periods primarily for working capital purposes by the
Russian operations.

27. Equity
Accounting policies
Share capital
Coca-Cola HBC has only one class of shares, ordinary shares. When new shares are issued, they
are recorded in share capital at their par value. The excess of the issue price over the par value isrecorded in the share premium reserve. Incremental external costs directly attributable to the issueof new shares or to the process of returning capital to shareholders are recorded in equity as adeduction, net of tax, in the share premium reserve.
Dividends
Dividends are recorded in the Group’s consolidated financial statements, against the relevant equity
component, in the period in which they are approved by the Group’s shareholders.

215

216

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
27. Equity continuedc) Treasury shares and reserves
The reserves of the Group at 31 December were as follows:a) Share capital, share premium and Group reorganisation reserve

Balance as at 1 January 2021
Shares issued to employees
exercising stock options(refer to Note 29)
Dividends
Balance as at 31 December 2021
Shares issued to employees
exercising stock options(refer to Note 29)
Dividends
Balance as at 31 December 2022

Number ofshares(authorised
and issued)

Sharecapital€ million

Sharepremium€ millionGroup
reorganisation
reserve€ million

370,512,597

2,014.4

3,321.4(6,472.1)

1,282,821–
371,795,418

7.9–
2,022.3

11.7(235.8)3,097.3––(6,472.1)

290,677–
372,086,095

2.0–
2,024.3

2.7(262.6)
2,837.4––(6,472.1)

The Group reorganisation reserve relates to the impact from adjusting share capital, share premiumand treasury shares to reflect the respective statutory amounts of Coca-Cola HBC on 25 April 2013,
together with the transaction costs incurred by the latter, relating primarily to the re-domiciliation of
the Group and its admission to listing in the premium segment of the London Stock Exchange, following
successful completion of the voluntary share exchange offer (refer also to Note 1). These transactions
were treated as a reorganisation of an existing entity that has not changed the substance of thereporting entity.
In 2022, the share capital of Coca-Cola HBC increased by the issue of 290,677 (2021: 1,282,821) new
ordinary shares following the exercise of stock options pursuant to the Coca-Cola HBC AG’s employees
stock option plan. Total proceeds from the issuance of the shares under the stock option planamounted to €4.7 million (2021: €19.6 million).
Following the above changes, on 31 December 2022 the share capital of the Group amounted to€2.024,3 million and comprised 372,086,095 shares with a nominal value of CHF 6.70 each.

b) Dividends
On 22 June 2021, the shareholders of Coca-Cola HBC AG at the Annual General Meeting approved
a dividend distribution of €0.64 per share. The total dividend amounted to €235.8 million and was paidon 3 August 2021. Of this an amount of €2.2 million related to shares held by the Group.
The shareholders of Coca-Cola HBC AG approved a dividend distribution of €0.71 per share at theAnnual General Meeting held on 21 June 2022. The total dividend amounted to €262.6 million andwas paid on 2 August 2022. Of this an amount of €2.4 million related to shares held by the Group.
The Board of Directors of Coca-Cola HBC AG has proposed a €0.78 dividend per share in respectof 2022. If approved by the shareholders of Coca-Cola HBC AG, this dividend will be paid in 2023.

Treasury shares
Exchange equalisation reserve
Other reserves
Hedging reserve, net
Tax-free reserve
Statutory reserves
Stock option, performance share and deferred management
incentive share reserve
Financial assets at fair value through other comprehensive
income reserve, net
Other
Total other reserves
Total reserves

2022€ million

2021€ million(131.2)(1,218.2)(146.6)(1,154.0)

(4.4)
163.8
22.6

9.9
163.8
28.3

87.5

86.3

0.5
22.5
292.5
(1,056.9)

0.6
21.3
310.2
(990.4)

Treasury shares
Treasury shares held by the Group represent shares acquired following approval of share buy-backprogrammes, forfeited shares under the equity compensation plan operated by the Group, as well asshares representing the initial ordinary shares of Coca-Cola HBC acquired from Kar-Tess Holding.
An amount of €15.4 million in 2022 (2021: €8.9 million) relates to treasury shares provided to employees
in connection with vested performance share awards under the Group’s employee incentive scheme,
which was reflected as an appropriation of reserves between ‘Treasury shares’ and ‘Other reserves’,
more specifically the ‘Stock option, performance share and deferred management incentive sharereserve’ in the consolidated statement of changes in equity.
As at 31 December 2022, 5,386,717 (2021: 5,894,583) treasury shares were held by the Group.

Exchange equalisation reserve
The exchange equalisation reserve comprises all foreign exchange differences arising from thetranslation of the financial statements of Group entities with functional currencies other than the Euro.

Other reserves
Hedging reserve
The hedging reserve reflects changes in the fair values of derivatives accounted for as cash flow
hedges, net of the deferred tax related to such balances.
Tax-free and statutory reserves
The tax-free reserve includes investment amounts exempt from tax according to incentive legislation,other tax-free income or income taxed at source. Statutory reserves are particular to the various
countries in which the Group operates. The amount of statutory reserves of the parent entity,
Coca-Cola HBC AG, is €nil. During 2022, a net amount of €5.7 million was reclassified from statutory
reserves to retained earnings relating to the net release of additional reserves by the Group’s subsidiaries.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
27. Equity continued
Stock option, performance share and deferred management incentive share reserve
The stock option, performance share and deferred management incentive share reserve represents
the cumulative charge to the income statement for employee stock option, performance shareand deferred management incentive share awards less the vested performance share and deferredmanagement incentive share awards.
Other
Other reserves are particular to the various countries in which the Group operates and include shares
held for the Group’s employee share purchase plan, which is an equity compensation plan in which
eligible employees may participate as well as the Group’s share of changes in other reserves of equity
method investments.

28. Related party transactionsa) The Coca-Cola Company
As at 31 December 2022, The Coca-Cola Company indirectly owned 21.0% (2021: 21.0%) of the issued
share capital of Coca-Cola HBC. The Coca-Cola Company considers Coca-Cola HBC to be a ‘keybottler’ and has entered into bottlers’ agreements with Coca-Cola HBC in respect of each of theGroup’s territories. All the bottlers’ agreements entered into by The Coca-Cola Company andCoca-Cola HBC are Standard International Bottlers’ (SIB) agreements. The terms of the bottlers’agreements grant Coca-Cola HBC the right to produce and the exclusive right to sell and distributethe beverages of The Coca-Cola Company in each of the countries in which the Group operates.
Consequently, Coca-Cola HBC is obliged to purchase all concentrate for The Coca-Cola Company’s
beverages from The Coca-Cola Company, or its designee, in the ordinary course of business. On 10
October 2012, The Coca-Cola Company agreed to extend the term of the bottlers’ agreements fora further ten years until 2023.
The Coca-Cola Company owns or has applied for the trademarks that identify its beverages in each of
the countries in which the Group operates. The Coca-Cola Company has authorised Coca-Cola HBC
and certain of its subsidiaries to use the trademark ‘Coca-Cola’ in their corporate names.

Accounting policy
Contributions from The Coca-Cola Company
The Coca-Cola Company participates at its discretion in shared marketing programmes with
the Group to promote the sale of The Coca-Cola Company products. Where such co-operative
arrangements are entered into, the Group receives contributions from The Coca-Cola Company tooffset the cost it has incurred for price support and marketing and promotional campaigns in respectof specific customers as well as general marketing programmes.
These contributions from The Coca-Cola Company are classified as other income and are accrued
and matched to the expenditure to which they relate, in line with the substance of the arrangementwith The Coca-Cola Company as described above. These contributions are presented as follows:• to the extent that they relate to compensation for costs incurred by the Group for price supportand marketing and promotional campaigns in respect of specific customers, which have beentreated as a deduction from revenue from contracts with customers, they are presented as anoffset against such deductions from revenue and accordingly, included within net sales revenue
in the consolidated income statement;• to the extent that they relate to compensation for expenditure incurred by the Group in connection
with general marketing programmes, they are presented as an offset against this expenditure andaccordingly, included within operating expenses in the consolidated income statement.
The below table summarises transactions with The Coca-Cola Company and its subsidiaries:

Purchases of concentrate, finished products and other items
Net contributions received for marketing and promotional incentives
Sales of finished goods and raw materials
Other income
Other expenses

2022€ million

2021€ million

1,808.7
108.6
4.2
8.6
4.7

1,598.8
83.1
4.5
2.8
4.2

Contributions received from The Coca-Cola Company for marketing and promotional incentives
during the year amounted to €108.6 million (2021: €83.1 million): contributions made by The Coca-Cola
Company to Coca-Cola HBC for price support and marketing and promotional campaigns in respect ofspecific customers in 2022 totalled €59.9 million (2021: €52.6 million) and were recognised as an offset
against the relevant incentives provided to those customers within net sales revenue (refer to Note 8),
while contributions made by The Coca-Cola Company to Coca-Cola HBC for general marketing
programmes in 2022 totalled €48.7 million (2021: €30.5 million) and were recognised against the relevant
cost incurred within operating expenses (refer to Note 9). The Coca-Cola Company has also customarily
made additional payments for marketing and advertising directly to suppliers as part of the sharedmarketing arrangements. The proportion of direct and indirect payments, made at The Coca-Cola
Company’s discretion, will not necessarily be the same from year to year.

217

218

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
28. Related party transactions continuedc) Other related parties

As at 31 December 2022, the Group had a total amount due from The Coca-Cola Company of €45.3
million (2021: €52.8 million), and a total amount due to The Coca-Cola Company of €226.9 million(2021: €223.1 million).
Also, refer to Note 24 regarding consideration paid to The Coca-Cola Company during 2022 for thepurchase of a convertible loan and shares held by non-controlling interests in connection with theacquisition of Coca-Cola Bottling Company of Egypt S.A.E. In 2021, the Group paid a total considerationof €5.6 million to The Coca-Cola Company for the acquisition of Costa Express business.

b) Frigoglass S.A. (‘Frigoglass’), Kar-Tess Holding and AG Leventis (Nigeria) Ltd
Truad Verwaltungs AG currently indirectly owns 48.4% of Frigoglass and 99.3% of AG Leventis (Nigeria)
Ltd (2021: 48.6% and 99.3% respectively) and also indirectly controls Kar-Tess Holding, which holds
approximately 23.0% (2021: 23.0%) of Coca-Cola HBC’s total issued share capital.
The below table summarises transactions with the above entities:
Frigoglass and subsidiaries
Purchases of coolers, cooler parts, glass bottles, crowns and raw andother materials
Maintenance and other expenses
AG Leventis (Nigeria) Ltd
Purchases of finished goods and other items
Other expenses

2022€ million

2021€ million

112.3
33.1

117.6
28.6

3.6
0.1

9.3
0.1

Frigoglass, a company listed on the Athens Exchange, is a manufacturer of coolers, cooler parts, glass
bottles, crowns and plastics.
Frigoglass has a controlling interest in Frigoglass Industries (Nigeria) Limited, a company in which theGroup has a 23.9% effective interest, through its investment in Nigerian Bottling Company Ltd.
The Group entered into a supply agreement with Frigoglass for the purchase of cooling equipment in
1999. The supply agreement was extended in 2004, 2008, 2013, 2018 and, most recently, in 2021,
on substantially similar terms. The current agreement expires on 31 December 2025.
As at 31 December 2022, Coca-Cola HBC owed €30.9 million (2021: €14.9 million) to and was owed
€4.4 million (2021: €0.8 million), including dividend receivable of €3.7 million (2021: €nil) by Frigoglass
and its subsidiaries. During 2022, the Group received dividends of €1.2 million (2021: €1.4 million) from
Frigoglass Industries (Nigeria) Limited, which are included in line ’Receipts from non-integral equity
method investments’ of the consolidated cash flow statement.
As at 31 December 2022, the Group owed €2.7 million (2021: €0.9 million) and had a lease liabilityof €4.2 million (2021: €6.0 million) to AG Leventis (Nigeria) Ltd.
Capital commitments to Frigoglass and its subsidiaries as at 31 December 2022 amounted to €25.5
million (€33.5 million as at 31 December 2021) including the Group’s share of its joint ventures‘ capitalcommitments to Frigoglass.

The below table summarises transactions with other related parties:

Purchases
Other expenses

2022€ million

2021€ million

8.5
15.5

1.5
15.1

During 2022, the Group incurred subsequent expenditure for fixed assets of €3.0 million (2021: €1.5
million) and purchased inventories of €5.5 million (2021: €nil) from other related parties. Furthermore,during 2022, the Group incurred expenses of €15.5 million (2021: €15.1 million) mainly related tomaintenance services for cold drink equipment and installations of coolers, fountains, vending andmerchandising equipment from other related parties.
As at 31 December 2022, the Group had a total amount due to other related parties of €3.7 million(2021: €0.6 million) and a total amount of dividend and loans receivable of €1.5 million and €nil
respectively (2021: €nil and €0.9 million respectively).
During 2022, the Group received dividends of €0.6 million from non-integral associates (2021: €0.5
million), which are included in line ‘Receipts from non-integral equity method investments’ of theconsolidated cash flow statement and paid €5.7 million (2021: €nil) in connection with capital increase of
non-integral associates, which are included in line ‘Payments for non-integral equity method
investments’ of the consolidated cash flows statement. Furthermore, during 2022, €1.3 million
regarding loans receivable from non-integral associates were converted to equity.

d) Joint ventures
During 2022, the Group purchased €26.0 million of finished goods (2021: €5.2 million) from joint
ventures. In addition, during 2022 the Group recorded sales of finished goods and raw materials of €9.2
million (2021: €4.8 million) to joint ventures. Furthermore, the Group recorded other income of €15.8
million (2021: €16.2 million) from joint ventures and other expenses of €15.7 million (2021: €13.4 million)
including €7.8 million (2021: €7.3 million) of interest charges from loans with joint ventures.
As at 31 December 2022, the Group owed €4.4 million including loans payable of €nil (2021: €149.8
million including loans payable of €63.2 million) to, and was owed €9.6 million including loans receivableof €4.3 million (2021: €13.9 million including loans receivable of €7.1 million) by, joint ventures. During2022, the Group received dividends of €9.7 million from integral joint ventures (2021: dividends andcapital returns of €47.8 million), which are included in line ‘Receipts from integral equity method
investments’ in the consolidated cash flow statement. Furthermore, during 2022, the Group paid €4.0
million (2021: €nil) in connection with capital increase of integral joint venture which is included in line
‘Payment for integral equity method investment’ in the consolidated cash flow statement.

e) Directors and senior management
There have been no transactions between Coca-Cola HBC and the Directors and senior management
except for remuneration (refer to Note 9).

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
29. Share-based payments

Terms and conditions

Accounting policies
Stock option, performance share award and deferred management incentive share plan
Coca-Cola HBC provides equity-settled share-based payments to its senior managers in the formof an employee stock option, performance share award and deferred management incentive shareplan (the ‘Plan’).
Stock options under the Plan are measured at fair value at the date of grant. Fair value reflects theparameters of the compensation plan, the risk-free interest rate, the expected volatility, thedividend yield and the early exercise experience under the Plan. Expected volatility is determined by
calculating the historical volatility of Coca-Cola HBC’s share price over previous years. The fair value
determined at the grant date is expensed on a straight-line basis over the vesting period.
The Plan offers a specified number of performance share awards and deferred management
incentive plan shares that vest three years after the grant. The fair value is determined at the grant
date and reflects the parameters of the compensation plan, the dividend yield and the closing shareprice on the date of grant. The fair value determined at the grant date is expensed on a straight-line
basis over the vesting period. At the end of each reporting period the Group revises its estimates of
the number of shares that are expected to vest based on non-market conditions, and recognises
the impact of the revision to original estimates, if any, in the income statement with a corresponding
adjustment to equity.
When the terms of an equity-settled award are modified, the minimum expense recognised is the
grant date fair value of the unmodified award, provided the original vesting terms of the award aremet. An additional expense, measured as at the date of modification, is recognised for any
modification that increases the total fair value of the share-based payment transaction, or isotherwise beneficial to the employee.
Employee Share Purchase Plan
The Group operates an employee share purchase plan (the ‘ESPP’), an equity compensation plan inwhich eligible employees can participate. The Group makes contributions to the plan for participating
employees and recognises expenses over the vesting period of the contributions.
The charge included in employee costs regarding share-based payments for the years ended 31
December is analysed as follows:

Performance share awards and deferred MIP shares
Employee Share Purchase Plan
Total share-based payments charge

2022€ million

2021€ million

15.5
6.1
21.6

14.6
5.5
20.1

Stock option, performance share award and deferred management incentive share plan
Based on Plan rules, senior managers are granted awards of stock options, based on performance,
potentiality and level of responsibility. Options are granted at an exercise price equal to the closing priceof the Company’s shares trading on the London Stock Exchange on the day of the grant. Options vest
in one-third increments each year for three years and can be exercised for up to 10 years from the dateof award. When the options are exercised, the proceeds received by the Group, net of any transaction
costs, are credited to share capital (at the nominal value) and share premium. The Group has not issued
any new stock options since 2014.
Since 2015 performance shares are the primary long-term award. Senior managers are granted
performance share awards, which have a three-year vesting period and are linked to Group-specific
key performance indicators. The closing price of the Company’s shares trading on the London Stock
Exchange on the day of the grant is used to determine the number of performance share awards
granted. In 2018 the Group modified the performance share plan, in order for eligible employees toreceive upon vesting, additionally to the specific number of shares, the value of dividends corresponding
to the years from grant till vest date, subject to the approval of the Remuneration Committee.
Furthermore, 50% of the Chief Executive Officer’s annual bonus awarded under the terms of the
management incentive plan is deferred into shares (the ’deferred MIP shares’) which vest over athree-year period, subject to service conditions. No dividend-equivalent shares corresponding to theyears from grant till vest date are provided, in connection with the deferred shares granted.
Employee Share Purchase PlanThe Employee Share Purchase Plan is administered by a Plan Administrator. Under the terms of thisplan, employees have the opportunity to invest 1% to 15% of their salary in ordinary Coca-Cola HBCshares by contributing to the plan through a payroll deduction. Employee deductions are used monthly
to purchase ordinary Coca-Cola HBC shares in the open market (London Stock Exchange).
Coca-Cola HBC will match employee contributions up to a maximum of 3% of the employee’s salary.
Employer matching cash contributions vest one year after the grant, at which time they are used topurchase matching shares on the open market that are immediately vested. Dividends received in
respect of shares held under this plan are used to purchase additional shares at the time of dividend
distribution. Shares are held under the Plan Administrator. For employees resident in Greece, CocaCola HBC matches the employee’s contribution with an annual employer contribution of up to 5% of
the employee’s salary that vests annually in December of each year.

219

220

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
29. Share-based payments continued

The weighted average fair value for the 2022 performance share and deferred MIP share plan was£15.95 per share (2021: £23.80, regarding performance shares). Relevant inputs into the valuation
were as follows:

Stock option activity
The outstanding stock options are fully vested and are exercisable until 2025.
A summary of stock option activity in 2022 under all grants is as follows:

Outstanding at 1 January
Exercised
ExpiredOutstanding at 31 December
Exercisable at 31 December

Numberof stock
options
2022

Weighted1
average
exercise price2022 (EUR)

Weighted
average
exercise price2022 (GBP)

2,338,855(290,677)(350,448)
1,697,730
1,697,730

18.08
16.05
24.01
16.02
16.02

15.21
14.17
21.20
14.15
14.15

Numberof stock
options
2021

Weighted1
average
exercise price2021 (EUR)

Weighted
average
exercise price2021 (GBP)

3,621,676(1,282,821)
2,338,855
2,338,855

15.97
15.66
18.08
18.08

14.49
13.17
15.21
15.21

A summary of stock option activity in 2021 under all grants is as follows:

Outstanding at 1 January
Exercised
Outstanding at 31 December
Exercisable at 31 December

1. For convenience purposes, the prices are translated at the closing exchange rate.

Total proceeds from the issuance of the shares under the stock option plan in 2022 amounted to€4.7 million (2021: €19.6 million).
The weighted average remaining contractual life of stock options outstanding at 31 December 2022
was 1.9 years (2021: 2.5 years).

Performance shares and deferred MIP shares activity
A summary of performance shares and deferred MIP shares activity is as follows:

Outstanding at 1 January
Granted2
VestedForfeited/cancelled
Outstanding at 31 December

Number ofshares2022

Number ofshares2021

2,475,367
1,301,669(516,156)(284,679)
2,976,201

2,294,478
835,477(294,832)(359,756)
2,475,367

2. Includes dividend-equivalent shares.

The weighted average remaining contractual life of performance shares and deferred MIP shares
outstanding at 31 December 2022 was 1.3 years (2021: 1.3 years, regarding performance shares).

Weighted average share price
Dividend yield3
Weighted average exercise period

2022

2021

£15.98nil
3 years£23.80nil
3 years

3. Dividend yield in connection with the valuation of the deferred MIP shares granted during 2022 was 3.2%.

30. Contingencies
In relation to the Greek Competition Authority’s decision of 25 January 2002, one of Coca-Cola Hellenic
Bottling Company S.A.’s competitors had filed a lawsuit against Coca-Cola Hellenic Bottling Company
S.A. claiming damages in an amount of €7.7 million. The court of first instance heard the case on
21 January 2009 and subsequently rejected the lawsuit. The plaintiff appealed the judgement and on
9 December 2013 the Athens Court of Appeals rejected the plaintiff’s appeal. On 19 April 2014, thesame plaintiff filed a new lawsuit against Coca-Cola Hellenic Bottling Company S.A. (following thespin-off, Coca-Cola HBC Greece S.A.I.C.) claiming payment of €7.5 million as compensation for losses
and moral damages for alleged anti-competitive commercial practices of Coca-Cola Hellenic BottlingCompany S.A. between 1994 and 2013. On 21 December 2018, the plaintiff served their withdrawal
from the lawsuit. However, on 20 June 2019, the same plaintiff filed a new lawsuit against Coca-Cola
HBC Greece S.A.I.C. claiming payment of €10.1 million as compensation for losses and moral damages
again for alleged anti-competitive commercial practices of Coca-Cola Hellenic Bottling Company S.A.
for the same period between 1994 and 2013. On 16 July 2021, the Athens Multimember Court of First
Instance issued its judgement number 1929/2021 (hereinafter the ‘Judgement’), which adjudicatesthat Coca-Cola HBC Greece S.A.I.C. is obliged to pay to the plaintiff an amount of circa €0.9 million plus
interest as of 31 December 2003. Both Coca-Cola HBC Greece S.A.I.C and the plaintiff have appealed
against this decision to the court of appeals. Both appeals were heard on 19 January 2023. The decision
is pending to be issued. Management believes that any liability to the Group that may arise as a result of
these pending legal proceedings will not have a material adverse effect on the results of operations,cash flows, or the financial position of the Group taken as a whole.
With respect to the investigation of the Greek Competition Commission initiated on 6 September 2016,
regarding Coca-Cola HBC Greece S.A.I.C.’s operations in certain commercial practices in the nonalcoholic beverages market, the Rapporteur of the Greek Competition Commission appointed for thiscase issued her Statement of Objections on 5 July 2021, alleging that Coca-Cola HBC Greece S.A.I.C.
undertook a series of anti-competitive practices in the market of instant consumption for cola andnon-cola carbonated soft drinks, thereby excluding competitors and limiting their growth potential.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Notes to the consolidated financial statements continued
30. Contingencies continued

31. Commitments

Coca-Cola HBC Greece S.A.I.C. has vigorously defended its commercial practices, in rebuttal of theallegations set out in the Statement of Objections. The hearing of the case, before the plenary sessionof the Greek Competition Commission, was concluded on 29 November 2021 and the supplementary
briefs of the parties were submitted on 16 December 2021. On 3 November 2022, the Hellenic
Competition Commission notified Coca-Cola HBC Greece S.A.I.C. of its ruling on the case, according towhich Coca-Cola HBC Greece S.A.I.C. allegedly abused its dominant position in the Greek immediate
consumption market segment for cola and non-cola carbonated soft drinks. The Hellenic Competition
Commission ruling imposed on Coca-Cola HBC Greece S.A.I.C. a fine of €10.3 million, as well as abehavioural remedy in relation to beverage coolers valid until end of 2024. Coca-Cola HBC Greece
S.A.I.C. has fully provided for the amount of the fine. Coca-Cola HBC Greece S.A.I.C. strongly disagrees
with this ruling and has challenged it before the competent Court of Appeal. The hearing date of thecase is not yet set.

Capital commitments

In 1992, our subsidiary NBC acquired a manufacturing facility in Nigeria from Vacunak, a Nigeriancompany. In 1994, Vacunak filed a lawsuit against NBC, alleging that a representative of NBC had orally
agreed to rescind the sale agreement and instead enter into a lease agreement with Vacunak. As partof its lawsuit, Vacunak sought compensation for rent and loss of business opportunities. NBC
discontinued all use of the facility in 1995. On 19 August 2013, NBC received the written judgementof the Nigerian court of first instance issued on 28 June 2012 providing for damages of approximately€16.7 million. The Appeal Court dismissed NBC’s appeal and Vacunak’s cross-appeal and affirmed thejudgement of the first instance court in 2023. NBC has filed an appeal against the judgement before theSupreme Court. Based on advice from NBC’s outside legal counsel, we believe that it is unlikely that NBC
will suffer material financial losses from this case. We have consequently not provided for any losses inrelation to this case.
In May 2021, the European Commission sent CCH a questionnaire, initiating a preliminary investigation
into a possible infringement by a CCH subsidiary, Coca-Cola European Partners and The Coca-Cola
Company of EU competition rules through the granting of conditional rebates to ‘off-trade’ customers
capable of foreclosing competition from other suppliers. On 28 February 2023, the European
Commission publicly announced that it has decided to end this preliminary investigation and as a result
this case has closed.
The tax filings of the Group and its subsidiaries are routinely subjected to audit by tax authorities in mostof the jurisdictions in which the Group conducts business. These audits may result in assessments ofadditional taxes. The Group provides for additional tax in relation to the outcome of such tax
assessments, to the extent that a liability is probable and estimable.
The Group is also involved in various other legal proceedings. Management believes that any liability to
the Group that may arise as a result of these pending legal proceedings will not have a material adverse
effect on the results of operations, cash flows, or the financial position of the Group taken as a whole.
Considering the above, there have been no significant adverse changes in contingencies since 31
December 2021 (as described in our 2021 Integrated Annual Report available on the Coca-Cola HBC’s
web site: www.coca-colahellenic.com).

As at 31 December 2022, the Group had capital commitments for property, plant and equipment
amounting to €210.5 million (2021: €166.1 million). Of this, €0.5 million are related to the Group’s shareof the commitments arising from joint ventures (2021: €9.0 million).
Capital commitments for 2022 include total future minimum lease payments under leases not yet
commenced to which the Group was committed at 31 December 2022 of €28.8 million (2021: €18.1 million).

32. Post balance sheet events
During 2023 the Egyptian Pound has depreciated against the Euro by approximately 24%. This has
resulted in a foreign exchange loss of approximately €6 million for the Group. We are continuously
monitoring the situation to ensure that timely actions are undertaken as needed to minimise any
adverse impact from the devaluation to the business in Egypt.
On 17 March 2023, the Remuneration Committee granted performance share and deferred MIP shareawards of €24.8 million equivalent, under the performance share award and deferred management
incentive share plan, which have a three-year vesting period. The number of shares granted is calculatedby dividing the value of the grant with the closing share price as of the date of the approval of the grant.

221

222

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

SWISS
STATUTORYREPORTING

Contents

Swiss Statutory Reporting
223

228
230
240
242

Report of the statutory auditor on
Coca‑Cola HBC AG’s consolidated
financial statements
Report of the statutory auditor on
Coca‑Cola HBC AG’s financial statements
Coca‑Cola HBC AG’s financial statements
Report of the statutory auditor on
the Statutory Remuneration Report
Statutory Remuneration ReportStrategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Report on the audit of the consolidated financial statements
Our audit approach
Overview

Report of the statutory auditor
to the General Meeting ofCoca-Cola HBC AG
Steinhausen (Zug)

Report on the audit of the consolidated
financial statements

Overall Group materiality:
Audit scope

Key audit matters• Goodwill and indefinite-lived intangible assets impairment assessment• Geopolitical events in Russia and Ukraine• Uncertain tax positions

OpinionWe have audited the consolidated financial statements of Coca-Cola HBC AG and its subsidiaries(the Group), which comprise the consolidated income statement and consolidated statement ofcomprehensive income for the year ended 31 December 2022, the consolidated balance sheet as at
31 December 2022 and the consolidated statement of changes in equity and consolidated cash flow
statement for the year then ended, including the notes to the consolidated financial statements anda summary of significant accounting policies.
In our opinion, the consolidated financial statements (pages 166 to 221) give a true and fair view of
the consolidated financial position of the Group as at 31 December 2022 and its consolidated financial
performance and its consolidated cash flows for the year then ended in accordance with International
Financial Reporting Standards (IFRS) as adopted by the European Union (EU) and comply with Swiss law.

Basis for opinion
We conducted our audit in accordance with Swiss law, International Standards on Auditing (ISAs) and
Swiss Standards on Auditing (SA-CH). Our responsibilities under those provisions and standards arefurther described in the ‘Auditor’s responsibilities for the audit of the consolidated financial statements’section of our report. We are independent of the Group in accordance with the provisions of Swiss law
and the requirements of the Swiss audit profession, as well as the International Code of Ethics forProfessional Accountants (including International Independence Standards) issued by the International
Ethics Standards Board for Accountants (IESBA Code), and we have fulfilled our other ethicalresponsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.

EUR 41’100’000
We conducted full scope audit procedures on the financial informationof 17 subsidiaries in 15 countries spread across all of the Group’sreportable segments. We also conducted procedures around specificaccount balances and transactions and analytical review procedures forother subsidiaries and Group functions. Our audit scope addressed 83%
of consolidated net sales revenue, 87% of consolidated profit before tax
and 87% of consolidated total assets of the Group.
As key audit matters the following areas of focus have been identified:Materiality
The scope of our audit was influenced by our application of materiality. Our audit opinion aims toprovide reasonable assurance that the consolidated financial statements are free from material
misstatement. Misstatements may arise due to fraud or error. They are considered material if,
individually or in aggregate, they could reasonably be expected to influence the economic decisionsof users taken on the basis of the consolidated financial statements.
Based on our professional judgement, we determined certain quantitative thresholds for materiality,
including the overall Group materiality for the consolidated financial statements as a whole as set out
in the table below. These, together with qualitative considerations, helped us to determine the scopeof our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of
misstatements, both individually and in aggregate, on the consolidated financial statements as a whole.
Overall Group materiality
Benchmark applied
Rationale for themateriality benchmark
appliedEUR 41’100’000
Adjusted profit before tax
Our approach has changed from the previous year, where we used thereported profit before tax as the benchmark for determining overallmateriality. We consider that the reported profit before tax still remains
the principal measure used by the shareholders in assessing theunderlying performance of the Group and is a generally accepted
benchmark. However, we have adjusted this benchmark by items which,in our view, are considered unusual and infrequently occurring in naturedriven by the geopolitical events involving Russia and Ukraine.

We agreed with the Audit and Risk Committee that we would report to them misstatements above EUR
2’000’000 identified during our audit as well as any misstatements below that amount which, in our view,
warranted reporting for qualitative reasons.

223

224

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Report on the audit of the consolidated financial statements continued
Audit scope
We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion
on the consolidated financial statements as a whole, taking into account the structure of the Group, theaccounting processes and controls, and the industry in which the Group operates.
The Group operates through its trading subsidiaries in Nigeria, Egypt and 27 countries in Europe, as set
out in Notes 1 and 7 to the consolidated financial statements. The processing of the accounting
records for these subsidiaries is largely centralised in a shared services centre in Bulgaria, except for thesubsidiaries in Armenia, Belarus, Egypt, Moldova, North Macedonia, Russia and Ukraine, which process
their accounting records locally. The Group also operates centralised treasury functions in the
Netherlands and in Greece and a centralised procurement function for key raw materials in the
Netherlands.
Based on their significance to the consolidated financial statements and in light of the key audit matters
as noted below, we identified 17 subsidiaries in 15 countries spread across all of the Group’s reportablesegments (including the trading subsidiaries in Russia, Italy, Nigeria, Poland, Romania, and Switzerland)
which, based on our scoping analysis, required a full scope audit of their financial information. In addition,
audit procedures were performed with respect to the centralised treasury functions by the groupengagement team in Greece and with respect to the centralised procurement function by thecomponent audit team in the Netherlands. The group engagement team also performed analyticalreview and other procedures on balances and transactions of subsidiaries not covered by theprocedures described above.
As the Swiss statutory auditor, we issued group audit instructions to PwC Greece, who has the
responsibility as the group engagement team for the Company’s reporting requirements for the
London and Athens Stock Exchange. These instructions covered the scope of our group audit to enable
us to fulfil our responsibilities under Swiss law. As the Swiss statutory auditor, we had ongoinginteractions with the group engagement team in Greece to be continuously updated and to monitor
their progress and the results of their procedures. We reviewed the instructions which PwC Greece
issued to component audit teams including centralised audit procedures performed at the sharedservices centres in Bulgaria and Greece and shared audit comfort with component teams as it relates to
IT general controls and cybersecurity risks. We reviewed working papers and undertook additional
interactions as considered necessary depending on the significance of the accounting and audit
matters. The Group consolidation, financial statement disclosures and a number of other areas thatinvolve significant judgement and estimates, including goodwill and intangible assets and the Group’s
overall going concern assessment, were audited by the Swiss statutory auditor and the groupengagement team of PwC Greece.

As the Swiss statutory auditor, we held frequent virtual meetings to oversee the work performed by thegroup engagement and component audit teams. We attended such meetings for Italy, Russia (including
Multon), Nigeria, Romania, Switzerland, Austria, Bulgaria, Greece, Hungary, Northern Ireland, Poland,
Serbia, the Netherlands, and Egypt. As the Swiss statutory auditor, we also held physical meetings anddiscussions with the management of the trading subsidiaries in Italy and Switzerland to discuss businessperformance and outlook, matters relating to regulation and taxation, as well as any specific accounting
and auditing matters identified, including fraud and internal controls.
Based on the above, the subsidiaries which were in the scope for the purposes of the group audit
accounted for 83% of consolidated net sales revenue, 87% of consolidated profit before tax and 87%
of consolidated total assets of the Group. This, together with the additional procedures performed at
Group level, provided us with sufficient appropriate evidence for our audit opinion on the consolidated
financial statements.

Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the consolidated financial statements of the current period. These matters were addressedin the context of our audit of the consolidated financial statements as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion on these matters.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Report on the audit of the consolidated financial statements continued
Goodwill and indefinite-lived intangible assets impairment assessment

Geopolitical events in Russia and Ukraine

Key audit matter
Refer to Note 14 ‘Intangible assets’.

Key audit matter
Refer to Note 6 ‘Russia-Ukraine conflict impact’
and Note 24 ‘Business combinations’.

How our audit addressed the key audit matter
We evaluated the appropriateness of management’s
identification of the Group’s CGUs, related control
Goodwill and indefinite-lived intangible assets as at
activities and the process by which management
31 December 2022 amount to EUR 1,926.0 million
prepared the CGUs’ value-in-use calculations.
and EUR 612.4 million, respectively.
We tested the mathematical accuracy of the CGUs’
The above amounts have been allocated tovalue-in-use calculations and compared the cash
individual cash-generating units (‘CGUs’), whichflow projections included therein to the financial
in accordance with International Accounting
budgets, approved by the Board of Directors,
Standard 36 ‘Impairment of Assets’ (‘IAS 36’)
covering a one-year period, and management’s
require the performance of an impairment
projections for the subsequent four years.
assessment at least annually or whenever there
In addition, we assessed management’s past
is an indication of impairment. The impairment
forecasting accuracy by comparing key elements
assessment involves the determination of theof the prior year projections with actual results.
recoverable amount of the CGU, being the higher
We challenged management’s cash flowof the value-in-use and the fair value less costs
projections in relation to the assumptions appliedof disposal.
to the value-in-use calculations, taking into
This area was a key matter for our audit due toaccount the elevated inflationary environment.
the size of goodwill and indefinite-lived intangible
With the support of our valuation specialists, we
assets balances and because the determinationof whether elements of goodwill and of indefinite- assessed the appropriateness of the methodology
and valuation techniques used as well as certain
lived intangible assets are impaired involves
assumptions including discount, annual revenue
complex and subjective estimates made by
growth, perpetuity revenue growth and foreign
management about the future results of theexchange rates.
CGUs. These estimates include assumptions
surrounding revenue growth rates, costs, foreign
We performed our independent sensitivity
exchange rates and discount rates.
analyses on the key drivers of the value-in-use
Management has identified the Egypt CGU to besensitive to reasonably possible changes in theassumptions used, which could result in thecalculated recoverable amount being lower infuture periods than the carrying value of the CGU.
Additional sensitivity disclosure has been includedin the financial statements in respect of this CGU.

calculations for the CGUs with significant balancesof goodwill and indefinite-lived intangible assets.
As a result of our work, we found that theconclusions reached by management in relation to
the impairment testing of goodwill and indefinitelived intangible assets were supported byassumptions within reasonable ranges.

As a result of the above assessments,
We evaluated the related disclosures provided inmanagement did not identify any impairments for the financial statements in Note 14 ‘Intangible
goodwill and indefinite-lived assets, other than the assets’ and concluded that these are appropriate.
impairment charge of EUR 13.7 million recognised
for the Russia based operations that is discussed in
the Key Audit Matter ‘Geopolitical events in Russia
and Ukraine’.

How our audit addressed the key audit matterIn relation to the Multon Partners and Ukraine
CGUs’ impairment assessment, we followed theprocedures described in the Key Audit Matter‘Goodwill and indefinite-lived intangible assets
impairment assessment’.

The geopolitical developments involving Russia
and Ukraine alongside The Coca-Cola Company’s(‘TCCC’) decision to suspend its business in Russia
For the tangible assets, we understood theare indications of potential impairment of theprocess that management followed for Multon
operations in both countries where the Group
Partners’ impairment exercises. We worked closely
operates in accordance with IAS 36.
with the component auditors in Russia to test
The Russia based operations consisted of thethe mathematical accuracy of the tangible assets
Group’s subsidiary ‘Multon Partners’ and one joint
impairment assessment and challenge management
venture ‘Multon AO group of companies’ (‘Multon
on the assumptions used in light of TCCC’s
JV’) accounted for under the equity method.
suspension of the business and sanctions imposed.
In August 2022, TCCC unilaterally waived certain
Furthermore, we leveraged the work performedof its governance rights in connection with its 50%
for the discount, growth and foreign exchangeinterest in Multon JV. As a result, the Group gained
rates as described in the Key audit matter ‘Goodwill
control of Multon JV in accordance withand indefinite-lived intangible assets impairment
International Financial Reporting Framework 10
assessment’.
‘Consolidated financial statements’ (‘IFRS 10’).
With regards to the Multon JV, we assessed,
The Group performed impairment exercises onwith the support of our valuation specialists, theits Russia and Ukraine based operations for both
appropriateness of the methodology, the valuationinterim and year-end financial reporting purposes.
techniques and the assumptions used by
As a result of the above, Multon Partners incurred management as well as the mathematical
impairment losses of EUR 13.7 million for goodwill accuracy of their impairment model.
and of EUR 60.9 million for tangible assets. In addition,
Based on our work, we found that the conclusions
the Multon JV was impaired by EUR 52.8 million.
reached by management in relation to their
No impairment losses were identified for the
impairment assessment were supported by
Ukrainian CGU.
assumptions within reasonable ranges. Moreover,
we verified the appropriateness of the Multon JV’s
Given the significance of the events describedabove as well as the related financial impact on the change of control accounting treatment and its
financial impact.
Group’s financial statements, we concluded that
this area is a key audit matter.

We evaluated the related disclosures provided in
the financial statements in Note 6 ‘Russia-Ukraine
conflict impact’ and Note 24 ‘Business combinations’and concluded that these are appropriate.

225

226

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Report on the audit of the consolidated financial statements continued
Uncertain tax positions

Other information

Key audit matter
Refer to Note 11 ‘Taxation’ and Note 30‘Contingencies’.

The Board of Directors is responsible for the other information. The other information comprises theinformation included in the annual report, but does not include the financial statements, theconsolidated financial statements, the statutory remuneration report and our auditor’s reports thereon.

How our audit addressed the key audit matterIn order to understand and evaluate
management’s judgement, we considered thestatus of current tax authority inspections andenquiries, the outcome of previous tax authority
inspections, judgemental positions taken in tax
returns and current year estimates as well as
recent developments in the tax jurisdictions inwhich the Group operates.

The Group operates in numerous tax jurisdictions
and is subject to periodic tax inspections, in thenormal course of business, by local tax authorities
on a range of tax matters in relation to corporatetax, transfer pricing and indirect taxes. As at 31
December 2022, the Group has current tax
We evaluated the Group’s monitoring process ofliabilities of EUR 114.4 million, while provisions for
uncertain tax positions amount to EUR 67.5 million. the current tax authority inspections andchallenged management’s estimates, particularly
The impact of changes in local tax regulations andin respect of cases where there had beenongoing inspections by local tax authorities, could
significant developments with tax authorities.
materially impact the amounts recorded in the
Our component audit teams, through the use offinancial statements.
tax specialists with local knowledge and relevant
Where the amount of tax payable is uncertain, theexpertise, assessed the tax positions taken by theGroup establishes provisions based on
subsidiary in scope, in the context of applying local
management’s estimates with respect to the
tax laws and evaluating the local tax assessments.
likelihood of material tax exposures crystallising
Additionally, with our group engagement team tax
and the probable amount of the resultant liability.
specialists we further evaluated management’s
We consider this area as a key audit matter given
estimation of tax exposures and contingencies
the level of judgement and uncertainty involved in in order to assess the adequacy of the Group’s
estimating tax provisions and the complexities oftax provisions.
dealing with tax rules and regulations in numerous
We held meetings with Group and local
jurisdictions.
management to discuss the individual tax positionsof the subsidiary in scope and assessed with thesupport of our group engagement tax team theGroup’s overall tax exposure.
From the evidence obtained we consider theprovisions in relation to uncertain tax positions as
at 31 December 2022 to be reasonable. We also
evaluated the related disclosures provided in thefinancial statements in Note 11 ‘Taxation’ andNote 30 ‘Contingencies’ and concluded that these
are appropriate.

Our opinion on the consolidated financial statements does not cover the other information and we do
not express any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read theother information and, in doing so, consider whether the other information is materially inconsistent
with the consolidated financial statements or our knowledge obtained in the audit, or otherwise appears
to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of thisother information, we are required to report that fact. We have nothing to report in this regard.

Board of Directors’ responsibilities for the consolidated financial
statements
The Board of Directors is responsible for the preparation of the consolidated financial statements,
which give a true and fair view in accordance with IFRS as adopted by the EU and the provisions of Swisslaw, and for such internal control as the Board of Directors determines is necessary to enable thepreparation of consolidated financial statements that are free from material misstatement, whether
due to fraud or error.
In preparing the consolidated financial statements, the Board of Directors is responsible for assessing
the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the Board of Directors either intends
to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Report on the audit of the consolidated financial statements continued
Auditor’s responsibilities for the audit of the consolidated
financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial
statements as a whole are free from material misstatement, whether due to fraud or error, and to issue
an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but
is not a guarantee that an audit conducted in accordance with Swiss law, ISAs and SA-CH will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and areconsidered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these consolidated financial statements.
A further description of our responsibilities for the audit of the consolidated financial statements
is located on EXPERTsuisse’s website: http://www.expertsuisse.ch/en/audit-report. This description
forms an integral part of our report.

Report on other legal and regulatory requirements
In accordance with article 728a paragraph 1 item 3 CO and PS-CH 890, we confirm that an internal
control system exists which has been designed for the preparation of the consolidated financial
statements according to the instructions of the Board of Directors.
We recommend that the consolidated financial statements submitted to you be approved.
PricewaterhouseCoopers AG

Sandra Boehm Uglow
Licensed audit expert
Auditor in charge
Zurich, 20 March 2023

Tobias Handschin
Licensed audit expert

Coca-Cola HBC Integrated Annual Report 2022

227

228

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Report on the audit of the financial statements
Our audit approach
Materiality

Report of the statutory auditor
to the General Meeting ofCoca-Cola HBC AG
Steinhausen (Zug)

Report on the audit of the financial statements
OpinionWe have audited the financial statements of Coca-Cola HBC AG (the Company), which comprisethe balance sheet as at 31 December 2022, and the statement of income, the cash flow statement
for the year then ended, and notes to the financial statements, including a summary of significant
accounting policies.
In our opinion, the financial statements (pages 230 to 238) comply with Swiss law and the company’s
articles of incorporation.

Basis for opinion
We conducted our audit in accordance with Swiss law and Swiss Standards on Auditing (SA-CH).
Our responsibilities under those provisions and standards are further described in the ‘Auditor’s
responsibilities for the audit of the financial statements’ section of our report. We are independentof the Company in accordance with the provisions of Swiss law and the requirements of the Swiss
audit profession, and we have fulfilled our other ethical responsibilities in accordance with theserequirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.

The scope of our audit was influenced by our application of materiality. Our audit opinion aims toprovide reasonable assurance that the financial statements are free from material misstatement.
Misstatements may arise due to fraud or error. They are considered material if, individually or inaggregate, they could reasonably be expected to influence the economic decisions of users takenon the basis of the financial statements.
Based on our professional judgement, we determined certain quantitative thresholds for materiality,
including the overall materiality for the financial statements as a whole as set out in the table below.
These, together with qualitative considerations, helped us to determine the scope of our audit and thenature, timing and extent of our audit procedures and to evaluate the effect of misstatements, bothindividually and in aggregate, on the financial statements as a whole.
Overall materiality
Benchmark applied
Rationale for the materiality
benchmark applied

CHF 29’577’000
Net assets
We chose net assets as the benchmark because, in our view, it is thebenchmark which reflects the actual substance of the entity. This is a
generally accepted benchmark for ultimate holding companies.

We agreed with the Audit and Risk Committee that we would report to them misstatements above CHF
1’478’850 identified during our audit as well as any misstatements below that amount which, in our view,
warranted reporting for qualitative reasons.

Audit scope
We designed our audit by determining materiality and assessing the risks of material misstatement in
the financial statements. In particular, we considered where subjective judgements were made; forexample, in respect of significant accounting estimates that involved making assumptions andconsidering future events that are inherently uncertain. As in all of our audits, we also addressed the riskof management override of internal controls, including among other matters consideration of whether
there was evidence of bias that represented a risk of material misstatement due to fraud.
We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion
on the financial statements as a whole, taking into account the structure of the Company, theaccounting processes and controls, and the industry in which the Company operates.

Key audit matters
We have determined that there are no key audit matters to communicate in our report.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Report on the audit of the financial statements continued
Other information

Report on other legal and regulatory requirements

The Board of Directors is responsible for the other information. The other information comprises
the information included in the annual report, but does not include the financial statements, theconsolidated financial statements, the statutory remuneration report and our auditor’s reports thereon.

In accordance with article 728a paragraph 1 item 3 CO and PS-CH 890, we confirm that an internal
control system exists which has been designed for the preparation of the financial statements
according to the instructions of the Board of Directors.

Our opinion on the financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.

We further confirm that the proposed repayment of reserves from capital contributions and carryforward of the accumulated losses complies with Swiss law and the company’s articles of incorporation.
We recommend that the financial statements submitted to you be approved.

In connection with our audit of the financial statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

PricewaterhouseCoopers AG

If, based on the work we have performed, we conclude that there is a material misstatement of thisother information, we are required to report that fact. We have nothing to report in this regard.

Board of Directors’ responsibilities for the financial statements
The Board of Directors is responsible for the preparation of the financial statements in accordance withthe provisions of Swiss law and the company’s articles of incorporation, and for such internal control as
the Board of Directors determines is necessary to enable the preparation of financial statements thatare free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors is responsible for assessing the Company’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern andusing the going concern basis of accounting unless the Board of Directors either intends to liquidate
the Company or to cease operations, or has no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that anaudit conducted in accordance with Swiss law and SA-CH will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if, individuallyor in the aggregate, they could reasonably be expected to influence the economic decisions of users
taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is locatedon EXPERT-suisse’s website: http://www.expertsuisse.ch/en/audit-report. This description forms
an integral part of our report.

Sandra Boehm Uglow
Licensed audit expert
Auditor in charge
Zurich, 20 March 2023

Tobias Handschin
Licensed audit expert

229

230

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Swiss statutory reporting

Coca-Cola HBC AG, Steinhausen (Zug)

Coca-Cola HBC AG, Steinhausen (Zug)

Balance sheet

Statement of income
As at 31 December
CHF thousands

ASSETSCash and cash equivalents
Short-term receivables from direct and indirect participations
Receivables from related parties
Short-term receivables from third parties
Total current assets
Investments in subsidiaries
Property, plant and equipment (incl. right-of-use assets)
Total non-current assets
Total assets
LIABILITIES AND SHAREHOLDERS’ EQUITYOther payables
Short-term liabilities to direct and indirect participations
Short-term lease liabilities
Accrued expenses
Total short-term liabilities
Long-term interest-bearing liabilities to indirect participations
Long-term lease liabilities
Provisions
Total long-term liabilities
Share capital
Legal capital reserves
Reserves from capital contributions
Reserves for treasury shares
Retained earnings
Results carried forward
Loss for the year
Treasury shares
Total shareholders’ equity
Total liabilities and shareholders’ equity

Year ended 31 December
CHF thousands
Note

2022

2021

2.10

265,445
36,106
301,551

256,081
38,320294,401

2.11
2.12
2.3

(37,837)(16,809)(265,445)(48,278)(16,585)(256,081)(875)(320,966)(743)(321,687)

Operating loss

(19,415)(27,286)

Finance costs(4,239)(6,403)

Loss before tax
Direct taxes(23,654)(195)(33,689)(163)

Loss for the year

(23,849)(33,852)

2022

2021

261
12,311
1,430
2,356
16,3586,444,931
6,699
6,451,630
6,467,988

2,026
12,047338
1,491
15,902
6,710,376
4,936
6,715,312
6,731,214

Dividend income
Other operating income
Total operating income

2.7

2,108
2,592
556
59,24264,498200,326
1,685
11,542
213,553
2,492,977

1,713
3,149
704
47,74353,309204,482
2,127
15,987
222,596
2,491,029

2.8

3,721,117
85,2983,982,078
85,298(15,592)(23,849)(70,014)6,189,937
6,467,988

18,260(33,852)(87,504)
6,455,309
6,731,214

Note

2.1
2.2

2.3

2.4
2.4
2.5
2.6

2.8
2.9

Employee costs
Other operating expenses
Write down of investments
Depreciation on property, plant and equipment(incl. right-of-use assets)
Total operating expenses

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Swiss statutory reporting continued

Coca-Cola HBC AG, Steinhausen (Zug)
Cash flow statement
Year ended 31 December
CHF thousands
2022

2021

(23,849)(33,852)875
4,239
265,445
19,041
265,751

743
6,403
256,081
22,376
251,751(2,221)(265,445)

2,972(256,081)

13
5,044
665
265,445(193)
269,059(631)
12,416160
256,081(181)
266,487

Payments for purchases of property, plant and equipment
Cash outflow from investing activities(2,505)(2,505)(1,471)(1,471)

Principal repayments of lease obligations
Proceeds from long-term financial liabilities
Repayments of long-term financial liabilities
Dividends paid to owners of the Company
Proceeds from shares issued to employees exercisingstock options
Interest paid
Net cash outflow from financing activities
Net (decrease) / increase in cash and cash equivalents(722)
11,140(15,297)(263,551)

(405)
5,708
(24,894)(260,250)

4,538(4,413)(268,305)(1,751)

21,303(6,244)(264,782)
234

2,026
(1,751)
(14)
261

1,880
234
(88)
2,026

Note

Loss for the year
Depreciation of property, plant and equipment, including
right-of‑use assets
Finance costs
Write down of investments
Net change related to employee performance share plan

Decrease/(increase) in receivables
Decrease in investments in subsidiaries
Increase/(decrease) in short-term liabilities (excl. financial
liabilities)
Increase in accrued expenses
Increase in provisions
Proceeds from dividends received from subsidiaries
Tax paid
Net cash inflow from operating activities

Movement in cash and cash equivalents
Cash and cash equivalents at 1 January
Net (decrease) / increase in cash and cash equivalents
Effect of changes in exchange rates
Cash and cash equivalents at 31 December

2.3

2.3

2.3

231

232

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Swiss statutory reporting continued

Notes to the financial statements of
Coca-Cola HBC AG, Steinhausen (Zug)Introduction
Coca-Cola HBC AG (‘the Company’) was incorporated on 19 September 2012 by Kar-Tess Holding.
On 11 October 2012, the Company announced a voluntary share exchange offer to acquire all
outstanding ordinary registered shares and all American depositary shares of Coca-Cola Hellenic
Bottling Company S.A., Maroussi (GR) (‘CCHBC SA’). As a result of the successful completion of thisoffer, on 25 April 2013 the Company acquired 96.85% of the issued CCHBC SA shares, including
shares represented by American depositary shares, and became the new parent company of the Group(the Company and its direct and indirect subsidiaries). On 17 June 2013, the Company completed its
statutory buy-out of the remaining shares of CCHBC SA that it did not acquire upon completionof its voluntary share exchange offer.

The principal exchange rates used are:Exchange rates

Balance sheet as at
31 December 2022 31 December 2021

EUR
USD
GBP

0.99
0.93
1.12

1.04
0.91
1.23

Income statement for the year ended
31 December 2022 31 December 2021

1.00
–
–

1.08
–
–

Leasing disclosureManagement has applied an economic-view approach to the disclosure of lease contracts considering
the underlying usage rights. Right-of-use assets are presented within property, plant and equipment
and depreciated over their useful life. The short- and long-term lease liabilities are adjusted for interestand lease payments.

Investments in subsidiaries
Investments in subsidiaries are valued at historical cost and evaluated for impairment if identified
triggering events occur.

1. Accounting principles

Property, plant and equipment

Accounting principles applied in the preparation of the financial statements

Right-of-use assets are included within property, plant and equipment.

These financial statements have been prepared in accordance with the provisions of commercial
accounting as set out in the Swiss Code of Obligations (Art. 957 to 963b CO). From 1 January 2021, theCompany has prepared its consolidated financial statements in accordance with International Financial
Reporting Standards (IFRS) as adopted by the European Union (EU) in accordance with Art. 963b CO
due to a requirement from the Athens Exchange, its primary listing in the EU. In accordance with Art.
961 para 2. CO, the Company is presenting a cash flow statement. Significant accounting and valuation
principles are described below:

Depreciation is calculated on the basis of the following useful lives and in accordance with thefollowing methods:

Dividend income

The Company provides management services to its principal subsidiaries and acts as guarantor to its
principal subsidiary, Coca-Cola HBC Finance B.V. The income from these services is recognised in theaccounting period in which the service is provided.

Right-of-use buildings and Company cars
Furniture and fixtures, office equipment and other tangible
fixed assets
Telephony infrastructure
Communication equipment, computers and PCs
Tablets

Exchange rates and translation

Treasury shares

Dividend income is recognised when the right to receive payment is established.

Other operating income

The accounting records of the Company are retained in Euro and translated to Swiss Franc (CHF)
for presentation purposes. Except for investments in subsidiaries, property, plant and equipment,
long-term liabilities and equity, which are translated at historical rates, all assets and liabilities
denominated in foreign currencies are translated into CHF using the closing exchange rate as at
31 December 2022. Income and expenses are translated into CHF at the average exchange rate of thereporting year except for dividend income and related write down of investments (see Note 2.3) which
are valued at the transaction date exchange rate. Net unrealised exchange losses are recorded in theincome statement, while net unrealised exchange gains are deferred within accrued expenses.

Property, plant and equipment

Leasehold improvement (building)Leasehold improvement (office infrastructure)
Building infrastructure

Useful life

Method20 years
10 years
12 years
Shorter of usefullife and lease term

5% linear
10% linear
8.33% linear
Linear

8 years
12.5% linear
7 years 14.29% linear
4 years
25% linear
3 years 33.33% linear

Treasury shares are recognised at acquisition cost and deducted from shareholders’ equity at the timeof acquisition. If treasury shares are sold, the gain or loss arising is recognised in the income statement
as finance income or finance cost as appropriate.

Strategic
ReportCorporate
Governance

Swiss Statutory
Reporting

Financial
Statements

Coca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Swiss statutory reporting continued
2. Information relating to the balance sheet and statement of income
2.1 Short-term receivables from direct and indirect participations
The short-term receivables from direct and indirect participations do not bear interest.
As at 31 December
CHF thousands
2022

Name of participation

CC Beverages Holdings II B.V., Amsterdam
CCB Management Services GmbH, Vienna
Coca-Cola HBC Finance B.V., Amsterdam
Coca-Cola HBC Holdings B.V., Amsterdam
Coca-Cola Hellenic Business Service Organisation, Sofia
Short-term receivables from direct and indirect participations–
11,518663–
130
12,3112021

14
11,221606
11
195
12,047

2.2 Receivables from related parties
Receivables from related parties consist of receivables from international assignees arising mainly fromadvances paid to tax authorities.

2.3 Investments in subsidiaries
Direct subsidiary

Coca-Cola HBC Holdings B.V.,
Amsterdam1
Write down of investment
Investments in subsidiaries

Share of capital

Share of votes

100%

100%

100%

100%

As at 31 December
CHF thousands
2022

6,710,376(265,445)
6,444,931

2021

6,966,457(256,081)
6,710,376

1. Coca-Cola HBC Holdings B.V., Amsterdam was incorporated on 26 June 2013.

In 2015 the Company adopted a practice of reducing the value of its investment in Coca-Cola HBC
Holdings B.V. by an amount equal to the dividend received from that subsidiary. The amount of thewrite down in 2022 is equal to the dividend received in 2022 from Coca-Cola HBC Holdings B.V. of CHF
265,445 thousand (2021: CHF 256,081 thousand).
The principal direct and indirect participations of the Company are disclosed in Note 16 to theconsolidated financial statements.

2.4 Short-term liabilities to direct and indirect participations and accrued
expenses
The short-term liabilities to the direct and indirect participations do not bear interest except for theliability to Coca-Cola HBC Finance B.V., which is interest-bearing.

Name of participation

As at 31 December
CHF thousands
2022

CCB Management Services GmbH, Vienna
Coca-Cola Hellenic Business Service Organisation, Sofia
Coca-Cola HBC Switzerland Ltd
Coca-Cola HBC Finance B.V., Amsterdam
Coca-Cola HBC Northern Ireland Limited, Lisburn
Coca-Cola HBC Services MEPE, Athens
Coca-Cola HBC Hrvatska d.o.o, Zagreb
Total short-term liabilities to direct and indirect participations

1,162
60
5
1,346
1
9
9
2,592

Accrued expenses

As at 31 December
CHF thousands2022

Direct taxes
Management incentive plan and Performance Share Plan forown employees
Employee-related costs (social security and insurance, payroll taxes)
Provision for acquiring treasury shares to satisfy subsidiaries’
Performance Share Plan rights
Other accrued expenses
Net unrealised gains from foreign currency translation
Total accrued expenses

2021

1,724
74
4
1,338
–
9
–
3,149

2021

195

188

16,5905,741

15,871
4,553

11,774
6,881
18,061
59,242

7,542
7,291
12,29847,743

Following the publication of circular letter 37a by the Swiss Federal Tax Administration in May 2018, theCompany recognised a provision of CHF 13,636 thousand (2021: CHF 13,563 thousand) that relates
to the Company’s employee Performance Share Plan, of which CHF 9,182 thousand (2021: CHF 6,975
thousand) is short-term and is disclosed in the line item ‘Management incentive plan and Performance
Share Plan for own employees’; while CHF 4,454 thousand (2021: CHF 6,588 thousand) is long-termand disclosed in Note 2.6 ‘Provisions’. The provision for acquiring treasury shares to satisfy subsidiaries’
Performance Share Plan rights amounts to CHF 17,533 thousand (2021: CHF 16,177 thousand) of which
CHF 11,774 thousand (2021: CHF 7,542 thousand) is short-term and disclosed in accrued expenses while
CHF 5,759 thousand (2021: CHF 8,575 thousand) is long-term and disclosed in Note 2.6 ‘Provisions’.

233

234

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Swiss statutory reporting continued
2. Information relating to the balance sheet and statement of income
continued
2.5 Long-term interest-bearing liabilities
As at 31 December
CHF thousands
2022

200,326
200,326

Coca-Cola HBC Finance B.V, AmsterdamLong-term interest-bearing liabilities

2021

Long-term interest-bearing liabilities comprise loans from Coca-Cola HBC Finance B.V. received in 2019,2020, 2021 and 2022 of CHF 169,007 thousand (2021: CHF 184,637 thousand) maturing on 8 November
2024; and CHF 31,319 thousand (2021: CHF 19,845 thousand) maturing on 21 November 2029.

2.6 Provisions
2021

547

330

5,759

8,575

4,902
334
11,542

6,588
494
15,987

Number of shares

Nominal value
CHF

Total
CHF thousands

370,512,597
1,282,821
371,795,418

6.70
6.70
6.70

2,482,434
8,595
2,491,029

Number of shares

Nominal value
CHF

Total
CHF thousands

371,795,418
290,677
372,086,095

6.70
6.70
6.70

2,491,029
1,948
2,492,977

Long-term Incentive Plan
Provision for acquiring treasury shares to satisfy subsidiaries’
Performance Share Plan rights (refer to Note 2.4)
Performance and Management incentive share plan – Coca-Cola HBC
AG employees (refer to Note 2.4)
Provision for social security costs of Performance Share Plan
Provisions

2.7 Share capital
Share capital as at 1 January 2021
Shares issued to employees exercising stock options
Share capital as at 31 December 2021

Share capital as at 1 January 2022
Shares issued to employees exercising stock options
Share capital as at 31 December 2022

The number of treasury shares held by Coca-Cola HBC AG and its subsidiaries qualifying under article
659b Swiss Code of Obligations and their movements are as follows:
Treasury shares (held by subsidiaries)

204,482
204,482

As at 31 December
CHF thousands
2022

2.8 Treasury shares

Total treasury shares as at 31 December 2021
Total treasury shares as at 31 December 2022
Treasury shares held by the Company

Treasury shares held by the Company as at
1 January 2021
Vested PSP shares1
Treasury shares held by the Company as
at 31 December 2021
Treasury shares held by the Company
as at 1 January 2022
Vested PSP and MIP shares2
Treasury shares held by the Company as
at 31 December 2022

Number of shares

Acquisition cost
per share
CHF

Total
CHF thousands

3,430,135
3,430,135

24.8673
24.8673

85,29885,298

Number of shares

Acquisition cost
per share
CHF

Total
CHF thousands

2,759,280(294,832)

35.4115
34.6160(97,710)
10,2062,464,448

35.5066(87,504)

2,464,448(507,866)

35.5066
34.4375(87,504)
17,4901,956,582

35.7836(70,014)

1. In April 2021, following the vesting of the 2018 PSP plan, 294,832 treasury shares were transferred to relevant participants.
2. In January 2022, following the vesting of the 2019 MIP plan, 7,717 treasury shares were transferred to the relevant participant. In
April 2022, following the vesting of the 2019 PSP plan, 500,149 treasury shares were transferred to relevant participants.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Swiss statutory reporting continued
2. Information relating to the balance sheet and statement of income
continued
2.9 Shareholders’ equity

Share capital

Balance as at
1 January 2021
Shares issued to
employees exercisingstock options
Dividends
Vested PSP shares
Loss for the year
Balance as at 31
December 2021
Balance as at
1 January 2022
Shares issued to
employees exercisingstock options
Dividends2
Vested PSP and MIP
sharesLoss for the year
Balance as at
31 December 2022

Retainedearnings /(accumulated
losses)Legal capital reserves
Reserves from
Reserves forcapitaltreasury
contributions
shares1
CHF thousands

2,482,434 4,229,620

Guarantee fee is the income the Company receives for the services provided as guarantor to Coca‑Cola
HBC Finance B.V. and Nigerian Bottling Company Ltd.
TreasurysharesTotal

2.11 Employee costs
2022
CHF thousands

85,29818,260(97,710) 6,717,902

12,708(260,250)
–
–

–
–
–
–

–
–
–
(33,852)––
10,206–2,491,029 3,982,078

85,298(15,592)(87,504) 6,455,309

2,491,029 3,982,078

85,298(15,592)(87,504) 6,455,309

8,595
–
–
–

Management fees relate to service income earned from services provided to the Company’s direct
and indirect participations, whereof CHF 2,729 thousand (2021: CHF 3,431 thousand) is true-up fromprior year.

21,303(260,250)
10,206(33,852)

Wages and salaries
Social security costs
Pensions and employee benefits
Total employee costs

17,287
2,705
17,84537,8372021

21,422
3,172
23,684
48,278Pension and employee benefits include Performance Share Plan expenses for CCHBC AG employees in
the amount of CHF 7,121 thousand (2021: CHF 18,999 thousand). Refer to Note 2.4 for more information.

2.12 Other operating expenses
Other operating expenses amounting to CHF 16,809 thousand for 2022 (2021: CHF 16,585 thousand)mainly include CHF 11,506 thousand (2021: CHF 14,352 thousand) for management fees to CCBManagement Services GmbH, whereof CHF 220 thousand (2021: 1,121 thousand) is true-up
from prior year.

3. Other information
3.1 Net release of hidden reserves

1,948
–

2,590
(263,551)

–
–

–
–

–
–

4,538
(263,551)

–
–

–
–

–
–

–
(23,849)

17,490–17,490(23,849)2,492,977 3,721,117

85,298(39,441)(70,014) 6,189,937

1. Represents the book value of treasury shares held by subsidiaries.
2. On 21 June 2022 the shareholders of the Company at the Annual General Meeting approved the distribution of a gross dividendof €0.71 (2021: €0.64) on each ordinary registered share. The dividend was paid on 2 August 2022 and amounted to CHF 263,551
thousand (2021: CHF 260,250 thousand, paid 3 August 2021).

2.10 Other operating income2022
CHF thousands

Management fees
Guarantee fee
Total other operating income

33,348
2,758
36,1062021

35,4882,832
38,320No hidden reserves were released for the years ended 31 December 2022 or 31 December 2021.

3.2 Number of employees
In 2022 and 2021 on an annual average basis, the number of full-time-equivalent employees
did not exceed 50.

3.3 Contingent liabilities
Euro medium-term note programme
In June 2013, the Group established a new €3.0 billion Euro medium-term note programme (the ‘EMTN
programme’). The EMTN programme was updated in September 2014, September 2015 and April
2019, when it was increased to €5.0 billion. The EMTN programme was further updated in April 2020,
September 2021 and September 2022. Notes are issued under the EMTN programme through theCompany’s wholly-owned subsidiary Coca-Cola HBC Finance B.V., a private limited liability company
established under the laws of the Netherlands, and are fully, unconditionally and irrevocably guaranteedby the Company.
In March 2016, Coca-Cola HBC Finance B.V. issued €600 million, 1.875% Euro-denominated notes due
in November 2024, which are guaranteed by the Company.

235

236

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Swiss statutory reporting continued
3. Other information continued
In May 2019, Coca-Cola HBC Finance B.V. issued €700 million, 1%, Euro-denominated notes due in May
2027 and also issued €600 million, 1.625%, Euro-denominated notes due in May 2031, which are
guaranteed by the Company.
In November 2019, Coca-Cola HBC Finance B.V. completed the issue of a €500 million, Eurodenominated fixed rate bond maturing in November 2029, with a coupon rate of 0.625%, which isguaranteed by the Company.
In September 2022, Coca-Cola HBC Finance B.V. issued €500 million, 2.75%, green Euro-denominatednotes due in September 2025, which are guaranteed by the Company.
As at 31 December 2022, a total of €2.9 billion (2021: €2.4 billion) in notes issued under the EMTN
programme were outstanding.
Committed credit facilities
In April 2019, the Group updated its then-existing €500.0 million syndicated revolving credit facility (the‘RCF’), which was set to expire in June 2021. The updated RCF was increased to €800.0 million andextended to April 2024 with the option to be further extended for up to two years until April 2026.
Coca-Cola HBC Finance B.V. exercised its extension option and the RCF has been extended to April
2026. The RCF can be used for general corporate purposes and carries floating interest rates. No
amounts have been drawn under the RCF since its inception. The borrower under the RCF is theCompany’s wholly-owned subsidiary Coca-Cola HBC Finance B.V. and any amounts drawn under the
RCF are fully, unconditionally and irrevocably guaranteed by the Company.
Commercial paper programme
In October 2013 the Group established a new €1.0 billion Euro commercial paper programme (the ‘ECP
Programme’). The ECP Programme was updated in September 2014, May 2017 and May 2020.
Notes are issued under the ECP Programme by Coca-Cola HBC Finance B.V. and guaranteed by
the Company. The outstanding amount under the ECP Programme was €168 million as at 31
December 2022 (2021: €235 million).
Nigerian Bottling Company Ltd
In December 2019 the Group established an amortising loan facility of US Dollar 85 million with maturity
in December 2027. The purpose of the facility is to finance the purchase of production equipment
by Nigerian Bottling Company Ltd., the Group’s subsidiary in Nigeria. Over the course of 2020 and 2021,
the facility has been drawn down for approximately US Dollar 78 million. The obligations under thisfacility are guaranteed by the Company. The outstanding amount under the loan facility was €59 million
as at 31 December 2022 (2021: €63 million).

Credit support provider
On 18 July 2013, the Company signed as credit support provider to J.P. Morgan Securities plc, Credit
Suisse International, Credit Suisse AG, ING Bank N.V., Societe Generale, Merrill Lynch International and
The Royal Bank of Scotland plc in favour of Coca–Cola HBC Finance B.V. for the obligations as definedin the ISDA Master Agreements.1
On 24 July 2013, the Company signed as credit support provider to the Governor and Company of
the Bank of Ireland, in favour of Coca-Cola HBC Finance B.V. for the obligations as defined in the ISDA
Master Agreement.1
On 8 August 2013, the Company signed as credit support provider to Citibank N.A. in favour of CCHBC
Bulgaria AD for the obligations as defined in the ISDA Master Agreement.1
On 8 August 2013, the Company signed as credit support provider to Citibank N.A. in favour ofCoca-Cola HBC Finance B.V. for the obligations as defined in the ISDA Master Agreement.1
On 24 June 2014, the Company signed as credit support provider to Intesa Sanpaolo S.pA. in favourof Coca-Cola HBC Finance B.V. for the obligations as defined in the ISDA Master Agreement.1
On 5 October 2015, the Company signed as credit support provider to Macquarie Bank International
Limited in favour of Coca-Cola HBC Finance B.V. for the obligations as defined in the ISDA
Master Agreement.1
On 22 June 2016, the Company signed as credit support provider to UniCredit Bank AG in favourof Coca-Cola HBC Finance B.V. for the obligations as defined in the ISDA Master Agreement.1
On 31 August 2016, the Company signed as credit support provider to BNP Paribas in favourof Coca‑Cola HBC Finance B.V. for the obligations as defined in the ISDA Master Agreement.1
On 1 November 2017, the Company signed as credit support provider to Goldman Sachs Global
International in favour of Coca-Cola HBC Finance B.V. for the obligations as defined in the ISDA
Master Agreement.1
On 22 December 2017, the Company signed as credit support provider to Citigroup Global
Markets Limited in favour of Coca-Cola HBC Finance B.V. for the obligations as defined in the ISDA
Master Agreement.1
On 14 February 2018, the Company signed as credit support provider to Morgan Stanley & Co.
International PLC in favour of Coca-Cola HBC Finance B.V. for the obligations as defined in the ISDA
Master Agreement.1
On 25 March 2019, the Company signed as credit support provider to Citigroup Global Markets
Europe AG in favour of Coca-Cola HBC Finance B.V. for the obligations as defined in the ISDA
Master Agreement.1
On 1 July 2019, the Company signed as credit support provider to Credit Suisse Securities, Sociedad
de Valores, S.A. in favour of Coca-Cola HBC Finance B.V. for the obligations as defined in the ISDA
Master Agreement.1
On 10 July 2019, the Company signed as credit support provider to Macquarie Bank Limited(London Branch) in favour of Coca-Cola HBC Finance B.V. for the obligations as defined in the ISDA
Master Agreement.1

Strategic
ReportCorporate
Governance

Swiss Statutory
Reporting

Financial
Statements

Coca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Swiss statutory reporting continued
3. Other information continued

3.5 Shareholdings, conversion and option rights

On 12 November 2019, the Company signed as credit support provider to UBS AG in favourof Coca‑Cola HBC Finance B.V. for the obligations as defined in the ISDA Master Agreement.1
On 2 November 2020, the Company signed as credit support provider to J.P. Morgan AG in favour ofCoca-Cola HBC Finance B.V. for the obligations as defined in the ISDA Master Agreement.1

The table below sets out a comparison of the interests in the Company’s total issued share capital thatthe members of the Board of Directors (‘Directors’) and Executive Leadership Team hold (all of which,unless otherwise stated, are beneficial interests or are interests of a person connected with a Director
or a member of the Executive Leadership Team) and the interests in the Company’s share capital.

On 13 November 2020, the Company signed as credit support provider to Goldman Sachs Bank Europe
SE in favour of Coca-Cola HBC Finance B.V. for the obligations as defined in the ISDA Master Agreement.1
On 5 May 2022 and then on 26 September 2022, the Company signed as credit support provider toCitibank Nigeria Limited in favour of Nigerian Bottling Company Ltd for the obligations as defined in the
Treasury Master Agreement.2
1. The ISDA (International Swap Dealers Association) Master Agreement is a standardised form issued by the International Swap
Dealers Association Inc. to be used for credit support transactions.
2. The Treasury Master Agreement is an agreement between Nigerian Bottling Company Ltd and Citibank Nigeria describing generalterms and conditions regulating their relationship in regard to foreign currency transactions.

3.4 Significant shareholders
As at 31 December 2022 and 2021, there were two shareholders exceeding the threshold of 5% voting
rights in the Company’s share capital.
Date Number of shares

Total Kar-Tess Holding
Total Kar-Tess Holding
Total shareholdings related to
The Coca‑Cola Company
Total shareholdings related to
The Coca‑Cola Company

Percentage ofissued sharecapital1

Percentage ofissued sharecapital231.12.2021
31.12.2022

85,355,019
85,355,019

23.0%
22.9%

23.3%
23.3%

31.12.2021

78,252,731

21.0%

21.4%

31.12.2022

78,252,731

21.0%

21.3%

1. Basis: total issued share capital including treasury shares. Share basis 372,086,095 as at 31 December 2022 (2021:371,795,418).
2. Basis: total issued share capital excluding treasury shares. Share basis 366,699,378 as at December 2022 (2021: 365,900,835).

Directors
Anastassis G. David3
Zoran Bogdanovic
Charlotte J. Boyle
Henrique Braun
Olusola (Sola)
David‑Borha
Anna Diamantopoulou
William W. (Bill) Douglas III
Reto Francioni
Anastasios I. Leventis4
Christo Leventis5
Alexandra
Papalexopoulou
Bruno Pietracci
Ryan Rudolph

Executive Leadership
Team
Minas Agelidis
Mourad Ajarti
Ben Almanzar
Ivo Bjelis6
Jan Gustavsson
Nikos Kalaitzidakis
Naya KalogerakiMartin Marcel
Spyros Mello
Vitaliy Novikov
Sean O’Neil7
Sanda Parezanovic
Barbara Tönz

Number ofshares31.12.2022
Percentage ofissued sharecapital1

Percentage ofoutstanding
share capital2–
299,614
1,017
–

–
0.08%
0.00%
–

–
–
10,000
7,000––

Number ofshares31.12.2021
Percentage ofissued sharecapital1

Percentage ofoutstanding
share capital2

–
0.08%
0.00%
–

–
193,729
1,017
–

–
0.05%
0.00%
–

–
0.05%
0.00%
–

–
–
0.00%
0.00%
–
–

–
–
0.00%
0.00%
–
–

–
–
10,000
7,000
–
–

–
–
0.00%
0.00%
–
–

–
–
0.00%
0.00%
–
–

–
–
–

–
–
–

–
–
–

–
–
–

–
–
–

–
–
–

Number ofsharesPercentage ofissued sharecapital1

Percentage ofoutstanding
share capital2

Number ofsharesPercentage ofissued sharecapital1

Percentage ofoutstanding
share capital2

66,836
16,858
11,48238,508
196,868
62,58769,301
128,434
47,63847,488–98,285
4,176

0.02%
0.00%
0.00%
0.01%
0.05%
0.02%
0.02%
0.03%
0.01%
0.01%
–
0.03%
0.00%

0.02%
0.00%
0.00%
0.01%
0.05%
0.02%
0.02%
0.04%
0.01%
0.01%
–
0.03%
0.00%

50,112
12,496636–
169,298
44,28649,127
102,403
37,05529,8183,132
80,442
3,020

0.01%
0.00%
0.00%
–
0.05%
0.01%
0.01%
0.03%
0.01%
0.01%
0.00%
0.02%
0.00%

0.01%
0.00%
0.00%
–
0.05%
0.01%
0.01%
0.03%
0.01%
0.01%
0.00%
0.02%
0.00%

Footnotes are presented at the end of Note 3.5.

237

238

Strategic
ReportCorporate
Governance

Swiss Statutory
Reporting

Financial
Statements

Coca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Swiss statutory reporting continued
3. Other information continued

3.6 Fees paid to the auditor

The following table sets out information regarding the stock options and performance shares held bymembers of the Executive Leadership Team as at 31 December 2022:
Stock options (‘ESOP’)

Number ofstock options Already vested

Zoran Bogdanovic8
Minas Agelidis
Mourad Ajarti
Ben Almanzar
Ivo Bjelis6
Jan Gustavsson
Nikos Kalaitzidakis
Naya KalogerakiMartin Marcel
Spyros Mello
Vitaliy Novikov
Sean O’Neil7
Sanda Parezanovic
Barbara Tönz

132,743––––
199,658
11,68037,166
7,103–
15,927–
10,618–132,743––––
199,658
11,68037,166
7,103–
15,927–
10,618–Vesting at theend of 2022

–
–
–
–
–
–
–
–
–
–
–
–
–
–

Performance shares (‘PSP’)
Unvested andsubject toGranted inperformance2022
conditions

144,826
28,80721,98836,72425,32737,35728,80757,25632,591
20,62428,158601
29,87823,769380,685
74,10858,317
71,81850,767
98,37275,676
128,638
85,25047,322
68,140–78,49023,769The audit and other fees paid to the auditor are disclosed in Note 9 to the consolidated
financial statements.

3.7 Conditional capital
Vested69,75913,808
–
7,612
7,472
18,63913,80815,782
16,098
8,076
10,652
9,721
14,795–

1. Basis: total issued share capital including treasury shares. Share basis 372,086,095 as at 31 December 2022 (2021: 371,795,418).
2. Basis: total issued share capital excluding treasury shares. Share basis 366,699,378 as at 31 December 2022 (2021: 365,900,835).
3. Anastassis G. David is a beneficiary of:(a) a private discretionary trust, for the primary benefit of present and future members of the family of the late Anastasios George
Leventis, that has an indirect interest with respect to 85,355,019 shares held by Kar-Tess Holding and(b) a further private discretionary trust, for the primary benefit of present and future members of the family of the late Anastasios
George Leventis, that has an indirect interest with respect to 832,268 shares held by Ari Holdings Limited.
4. Anastasios I. Leventis is a beneficiary of:(a) a private discretionary trust, for the primary benefit of present and future members of the family of the late Anastasios George
Leventis, that has an indirect interest with respect to 85,355,019 shares held by Kar-Tess Holding and(b) a further private discretionary trust, for the primary benefit of present and future members of the family of the late Anastasios
George Leventis, that has an indirect interest with respect to 286,880 shares held by its trustee, Selene Treuhand AG and(c) a further private discretionary trust, for the primary benefit of present and future members of the family of the late Avgie
Leventis, that has an indirect interest with respect to 2,138,277 shares held by Carlcan Holding Limited.
5. Christo Leventis is a beneficiary of:(a) a private discretionary trust, for the primary benefit of present and future members of the family of the late Anastasios George
Leventis, that has an indirect interest with respect to 85,355,019 shares held by Kar-Tess Holding and(b) a further private discretionary trust, for the primary benefit of present and future members of the family of the late Anastasios
George Leventis, that has an indirect interest with respect to 482,228 shares held by its trustee, Selene Treuhand AG and(c) a further private discretionary trust, for the primary benefit of present and future members of the family of the late Avgie
Leventis, that has an indirect interest with respect to 2,138,277 shares held by Carlcan Holding Limited.
6. Mr. Ivo Bjelis joined the Executive Leadership Team on 1 January 2022.
7. Mr. Sean O’Neil’ s employment ceased on 31 March 2022.
8. The Remuneration Committee determined at its meeting in 17 March 2023 that, in line with the terms of the PSP, PSP awards
granted to Zoran Bogdanovic in 2020 vested over in aggregate 75,777 shares (including the dividend equivalent shares paid on PSP
shares that vested in 2023).

On 25 April 2013, the shareholders’ meeting agreed to the creation of conditional capital in the
maximum amount of CHF 245,601 thousand, through issuance of a maximum of 36,657 thousand fully
paid-in registered shares with a par value of CHF 6.70 each upon exercise of options issued to membersof the Board of Directors, members of the management, employees or advisers of the Company, its
subsidiaries and other affiliated companies. The share capital of CHF 2,492,977 thousand as disclosed
in the balance sheet differs from the share capital in the commercial register of CHF 2,491,029
thousand as at 31 December 2022 due to the exercise of management options in the course offinancial year 2022.
Conditional capital

Agreed conditional capital as per shareholders’ meetingon 25 April 2013
Shares issued to employees exercising stock options until
31 December 2016
Shares issued to employees exercising stock options in 2017
Shares issued to employees exercising stock options in 2018
Shares issued to employees exercising stock options in 2019
Shares issued to employees exercising stock options in 2020
Shares issued to employees exercising stock options in 2021
Remaining conditional capital as at 31 December 2021
Shares issued to employees exercising stock options in 2022
Remaining conditional capital as at 31 December 2022

Numberof shares

Book value pershare CHF

Total CHF
thousand

36,656,843

6.70

245,601(3,149,493)(4,122,401)(1,064,190)(1,352,731)(582,440)(1,282,821)
25,102,767(290,677)
24,812,090

6.70
6.70
6.70
6.70
6.70
6.70
6.70
6.70
6.70

(21,102)(27,620)(7,130)(9,063)(3,902)(8,595)
168,189(1,948)166,241

4. Subsequent events
The subsequent events in relation to financial year ended 31 December 2022 are disclosed in Note 32
to the consolidated financial statements.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Swiss statutory reporting continued

Proposed appropriation of available earnings
and reserves/declaration of dividend
3. Proposed appropriation of reserves/declaration of dividend

1. Total available reserves
Available earnings and reserves

Balance brought forward from previous years
Net loss for the year
Total accumulated losses to be carried forward

CHF thousands(15,592)(23,849)(39,441)

Reserves from capital contributions before distribution

3,721,117

Total available reserves

3,681,676

2. Proposed declaration of dividend from reserves
The Board of Directors proposes to declare a gross dividend of €0.78 on each ordinary registeredshare with a par value of CHF 6.70 from the general capital contribution reserve. Own shares held
directly by the Company are not entitled to dividends. The total aggregate amount of the dividends
shall be capped at an amount of CHF 300,000 thousand (the ‘Cap’), and thus will reduce the general
capital contribution reserve of CHF 3,721,117 thousand, as shown in the financial statements as at
31 December 2022, by a maximum of CHF 300,000 thousand. To the extent that the dividend
calculated on €0.78 per share would exceed the Cap on the day of the Annual General Meeting, due tothe exchange rate determined by the Board of Directors in its reasonable opinion, the Euro per shareamount of the dividend shall be reduced on a pro-rata basis so that the aggregate amount of all
dividends paid does not exceed the Cap. Payment of the dividend shall be made at such time and withsuch record date as shall be determined by the Annual General Meeting and the Board of Directors.

Variant 1: Dividend of €0.78 at current exchange rate
As of 31 December 2022

CHF thousands

Reserves from capital contributions before distribution
Proposed dividend of €0.781
Reserves from capital contributions after distribution

3,721,117(288,701)
3,432,416

Variant 2: Dividend if Cap is triggered
As of 31 December 2022

CHF thousands

Reserves from capital contributions before distribution(Maximum) dividend if cap is triggered2(Minimum) Reserves from capital contributions after distribution

3,721,117(300,000)
3,421,117

1. Illustrative at an exchange rate of CHF 1.00 per EUR. Assumes that the shares entitled to a dividend amount to 370,129,513.
2. Dividend is capped at a total aggregate amount of CHF 300,000 thousand.

239

240

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Report on the audit of the remuneration report 2022
In connection with our audit of the remuneration report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the audited
financial information in the remuneration report or our knowledge obtained in the audit, or otherwise
appears to be materially misstated.
Report of the statutory auditor
to the General Meeting ofCoca-Cola HBC AG
Steinhausen (Zug)

Report on the audit of the remuneration report 2022
OpinionWe have audited the remuneration report of Coca-Cola HBC AG (the Company) for the year ended
31 December 2022. The audit was limited to the information on remuneration, loans and advances
pursuant to Art. 14 to 16 of the Ordinance against Excessive Remuneration in Listed Companies
Limited by Shares (Ordinance) on pages 242 to 244 of the remuneration report.
In our opinion, the information on remuneration, loans and advances in the remuneration reportcomplies with Swiss law and article 14 to 16 of the Ordinance.

Basis for opinion
We conducted our audit in accordance with Swiss law and Swiss Standards on Auditing (SA-CH).
Our responsibilities under those provisions and standards are further described in the ‘Auditor’s
responsibilities for the audit of the remuneration report’ section of our report. We are independent of
the Company in accordance with the provisions of Swiss law and the requirements of the Swiss audit
profession, and we have fulfilled our other ethical responsibilities in accordance with theserequirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.

Other information
The Board of Directors is responsible for the other information. The other information comprises
the information included in the annual report, but does not include the statutory remuneration report,
the consolidated financial statements, the financial statements and our auditor’s reports thereon.
Our opinion on the remuneration report does not cover the other information and we do not express
any form of assurance conclusion thereon.

If, based on the work we have performed, we conclude that there is a material misstatement of thisother information, we are required to report that fact. We have nothing to report in this regard.

Board of Directors’ responsibilities for the remuneration report
The Board of Directors is responsible for the preparation of a remuneration report in accordance withthe provisions of Swiss law and the company’s articles of incorporation, and for such internal control
as the Board of Directors determines is necessary to enable the preparation of a remuneration reportthat is free from material misstatement, whether due to fraud or error. The Board of Directors is also
responsible for designing the remuneration system and defining individual remuneration packages.

Auditor’s responsibilities for the audit of the remuneration report
Our objectives are to obtain reasonable assurance about whether the information on remuneration,loans and advances pursuant to article 14 to 16 of the Ordinance is free from material misstatement,
whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonableassurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
Swiss law and SA-CH will always detect a material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of this remuneration report.
As part of an audit in accordance with Swiss law and SA-CH, we exercise professional judgment andmaintain professional scepticism throughout the audit. We also:• Identify and assess the risks of material misstatement in the remuneration report, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting
a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit proceduresthat are appropriate in the circumstances, but not for the purpose of expressing an opinion on theeffectiveness of the Company’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Report on the audit of the remuneration report 2022 continued
We communicate with the Board of Directors or its relevant committee regarding, among othermatters, the planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.
We also provide the Board of Directors or its relevant committee with a statement that we havecomplied with relevant ethical requirements regarding independence, and communicate with them
all relationships and other matters that may reasonably be thought to bear on our independence,
and where applicable, actions taken to eliminate threats or safeguards applied.
PricewaterhouseCoopers AG

Sandra Boehm Uglow
Licensed audit expert
Auditor in charge
Zurich, 20 March 2023

Tobias Handschin
Licensed audit expert

Coca-Cola HBC Integrated Annual Report 2022

241

242

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Swiss statutory reporting continued

Statutory Remuneration Report

Remuneration of the Board of Directors
2022 CHF

Additional disclosures regarding the Statutory Remuneration Report
The section below is in line with the Ordinance against Excessive Compensation in Listed Stock
Companies, which requires disclosure of the elements of compensation paid to the Company’s Boardof Directors and the Executive Leadership Team (formerly known as the Operating Committee). The
amounts relate to the calendar years of 2022 and 2021. In the information presented below, theexchange rate used for conversion of 2022 remuneration data from Euro to CHF is 1/1.0081 and theexchange rate used for conversion of 2021 remuneration data from Euro to CHF is 1/1.0833.
As the Company is headquartered in Switzerland, it is required for statutory purposes to present
compensation data for two consecutive years, 2022 and 2021. The applicable methodology used to
calculate the value of stock option and performance shares follows Swiss Standards. In 2022 and 2021,
the fair value of performance shares from the 2022 and 2021 grants is calculated based on theperformance share awards that are expected to vest. Below is the relevant information for Swiss
statutory purposes.
The Statutory Remuneration Report should be read in conjunction with the Directors’ remuneration
report presented in the Integrated Annual Report as the qualitative aspects of remuneration policy aredescribed therein.

Remuneration for acting members of governing bodies
The Company’s Directors believe that the level of remuneration offered to Directors and the membersof the Executive Leadership Team should reflect their experience and responsibility as determined by,among other factors, a comparison with similar multinational companies and should be sufficient to
attract and retain high-calibre Directors who will lead the Group successfully. In line with the Group’scommitment to maximise shareholder value, its policy is to link a significant proportion of remuneration
for its Executive Leadership Team to the performance of the business through short- and long-term
incentives. Therefore, the Executive Leadership Team members’ financial interests are closely alignedwith those of the Company’s shareholders through the equity-related long-term compensation plan.
The total remuneration of the Directors and members of the Executive Leadership Team of theCompany, including performance share grants, during 2022 amounted to CHF 24.5 million (2021:
CHF 27.6 million). Out of this, the amount relating to the expected value of performance share awards
granted in relation to 2022 was CHF 5.4 million (2021: CHF 5.5 million). Pension and post-employment
benefits for Directors and the Executive Leadership Team of the Company during 2022 amounted to
CHF 1.0 million (2021: CHF 1.0 million).

Anastassis G. David
Zoran Bogdanovic2
Charlotte J. Boyle
Henrique Braun3
Olusola (Sola)
David‑Borha4
Anna Diamantopoulou5
William W. (Bill) Douglas III
Reto Francioni6
Anastasios I. Leventis
Christo Leventis
Alexandra
Papalexopoulou
Bruno Pietracci7
Ryan Rudolph8
Total Board of Directors

Fees

Cash andnon-cashbenefits1

Cashperformance
incentives

Pensionand postemployment
benefits

Total fairvalue of stock
options at thedate granted

Total
compensation

151,215–
102,32282,664

–
–
–
–

–
–
–
–

–
–
–
–

–
–
–
–

151,215–
102,32282,664

98,794102,322
114,923
120,468
95,77082,664

–
–
–
–
–
–

–
–
–
–
–
–

–
–
–
–
–
–

–
–
–
–
–
–

98,794102,322
114,923
120,468
95,77082,664

98,794
89,217
82,664
1,221,817

–
–
–
–

–
–
–
–

–
–
–
–

–
98,794–
89,217–
82,664– 1,221,817

1. Cash and non-cash benefits consist of cost-of-living allowance, housing support, Employee Stock Purchase Plan, Private Medical
Insurance, Relocation Expenses, Home Trip Allowance, lump sum expenses and similar allowances.
2. Zoran Bogdanovic’s compensation was based on his role as CEO, member of the Executive Leadership Team, and his employment
agreement. Zoran Bogdanovic was not entitled to and did not receive additional compensation as a Director.
3. For Henrique Braun, on top of his fees, the Group paid CHF 6,639 in social security contributions as required by Swiss legislation.
4. For Olusola (Sola) David-Borha, on top of her fees, the Group paid CHF 7,935 in social security contributions as requiredby Swiss legislation.
5. For Anna Diamantopoulou, on top of her fees, the Group paid CHF 8,218 in social security contributions as requiredby Swiss legislation.
6. For Reto Francioni, on top of his fees, the Group paid CHF 7,180 in social security contributions as required by Swiss legislation.
7. For Bruno Pietracci, on top of his fees, the Group paid CHF 7,166 in social security contributions as required by Swiss legislation.
8. For Ryan Rudolph, on top of his fees, the Group paid CHF 6,639 in social security contributions as required by Swiss legislation.

Non-Executive Directors do not participate in any of the Group’s incentive plans, nor do they receive
any retirement benefits.

Strategic
ReportCorporate
Governance

Swiss Statutory
Reporting

Financial
Statements

Coca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Swiss statutory reporting continued
Remuneration of the Executive Leadership Team

Remuneration of the Board of Directors

The total remuneration of the Executive Leadership Team for 2022 amounted to CHF 23.3 million.

2021 CHF

Anastassis G. David
Zoran Bogdanovic2
Charlotte J. Boyle
Henrique Braun3
Olusola (Sola)
David‑Borha4
Anna Diamantopoulou5
William W. (Bill) Douglas III
Reto Francioni6
Anastasios I. Leventis
Christo Leventis
Alexandra
Papalexopoulou
Bruno Pietracci7
José Octavio Reyes8
Alfredo Rivera9
Ryan Rudolph10
Total Board of Directors

Fees

Cash andnon-cashbenefits1

Cashperformance
incentives

Pensionand postemployment
benefits

79,623–
98,47239,811

–
–
–
–

–
–
–
–

–
–
–
–

–
–
–
–

79,623–
98,47239,811

95,33098,472110,930
115,588
92,18979,623

–
–
–
–
–
–

–
–
–
–
–
–

–
–
–
–
–
–

–
–
–
–
–
–

95,33098,472110,930
115,588
92,18979,623

95,33042,95342,95339,811
79,623
1,110,708

–
–
–
–
–
–

–
–
–
–
–
–

–
–
–
–
–
–

–
95,330–42,953–42,953–39,811–
79,623– 1,110,708

Total fairvalue of stock
options at thedate granted

Total
compensation

2022 CHF

1. Cash and non-cash benefits consist of cost-of-living allowance, housing support, Employee Stock Purchase Plan, Private Medical
Insurance, Relocation Expenses, Home Trip Allowance, lump sum expenses and similar allowances.
2. Zoran Bogdanovic’s compensation was based on his role as CEO, member of the Executive Leadership Team, and his employment
agreement. Zoran Bogdanovic was not entitled to and did not receive additional compensation as a Director.
3. Henrique Braun was appointed to the Board of Directors on 22 June 2021. The Group has applied a half-year period fee of
CHF 39,811. On top of his fees, the Group paid CHF 3,237 in social security contributions as required by Swiss legislation.
4. For Olusola (Sola) David-Borha, on top of her fees, the Group paid CHF 7,752 in social security contributions as requiredby Swiss legislation.
5. For Anna Diamantopoulou, on top of her fees, the Group paid CHF 8,008 in social security contributions as requiredby Swiss legislation.
6. For Reto Francioni, on top of his fees, the Group paid CHF 6,932 in social security contributions as required by Swiss legislation.
7. For Bruno Pietracci was appointed to the Board of Directors on 22 June 2021. The Group has applied a half-year period feeof CHF 42,953. On top of his fees, the Group paid CHF 3,493 in social security contributions as required by Swiss legislation.
8. José Octavio Reyes retired from the Board of Directors on 22 June 2021. The Group has applied a half-year period base feeof CHF 42,953. On top of his fees, the Group paid CHF 2,436 in social security contributions as required by Swiss legislation.
9. Alfredo Rivera retired from the Board of Directors on 22 June 2021. The Group has applied a half-year period base feeof CHF 39,811.
10. For Ryan Rudolph, on top of his fees, the Group paid CHF 6,475 in social security contributions as required by Swiss legislation.

Non-Executive Directors do not participate in any of the Group’s incentive plans, nor do they receive
any retirement benefits.

Base salary1

Zoran Bogdanovic,
Chief Executive Officer
Other current members6
Former members7
Total Executive
Leadership Team

Cash andnon-cashbenefits2 Annual bonus3

Pension Total fair value
and post- of performance
employment
shares at thebenefits4
date granted5

Total
remuneration

838,403505,119782,074
5,048,967 4,958,833 3,878,814
591,015
351,2250

151,642 1,491,207 3,768,445
798,359 3,860,787 18,545,760
17,319–959,559

6,478,385 5,815,177 4,660,888

967,320 5,351,994 23,273,764

1. Base salary includes non-compete payments in 2022 to former members of the Executive Leadership Team.
2. Cash and non-cash benefits consist of cost-of-living allowance, housing support, schooling, employee share purchase plan, private
medical insurance, relocation expenses, home trip allowance, employer social security contributions, lump sum expenses, all paid
and unpaid sign-on bonuses, equalisation amounts and similar allowances.
3. The annual bonus for 2022 includes the accrued Management Incentive Plan (MIP) payout, receivable early in 2023 for the 2022
business performance, including amounts deferred in shares, employer social security contributions and gross-up for the tax
benefit, of CHF 4,660,888. The monetary value that was paid in 2022 under the MIP reflecting the 2021 business performance isapprox. CHF 5,897,852.
4. Members of the Executive Leadership Team participate in the pension plan of their employing entity, as appropriate.
5. Values under long-term incentives represent the fair value of performance shares that are expected to vest for the 2022 grantin order to comply with Swiss reporting guidelines.
6. Ivo Bjelis was appointed to the role of Chief Supply Chain Officer on 1 January 2022.
7. Sean O’Neil’ s employment ceased on 31 March 2022.

243

244

Strategic
ReportCorporate
Governance

Swiss Statutory
Reporting

Financial
Statements

Supplementary
Information

Swiss statutory reporting continued
Remuneration of the Executive Leadership TeamThe total remuneration of the Executive Leadership Team for 2021 amounted to CHF 26.4 million.
2021 CHF

Zoran Bogdanovic,
Chief Executive Officer
Other current members6
Former members7
Total Executive
Leadership Team

Base salary1

Cash andnon-cashbenefits2

Annual bonus3

Pension Total fair value
and post- of performance
employment
shares at thebenefits4
date granted5

873,862
4,745,415
581,082

956,346
6,881,649
281,445992,326
4,324,931
263,227

150,796814,544
51,623Total
remuneration

1,553,290 4,526,620
3,973,231 20,739,770– 1,177,377

6,200,359 8,119,440 5,580,484 1,016,963 5,526,521 26,443,767

1. Base salary includes non-compete payments in 2021 to former members of the Executive Leadership Team.
2. Cash and non-cash benefits consist of cost-of-living allowance, housing support, schooling, employee share purchase plan, private
medical insurance, relocation expenses, home trip allowance, employer social security contributions, lump sum expenses, all paid
and unpaid sign-on bonuses, equalisation amounts and similar allowances.
3. The annual bonus for 2021 includes the accrued Management Incentive Plan (MIP) payout, receivable early in 2022 for the 2021
business performance, including amounts deferred in shares, employer social security contributions and gross-up for the tax
benefit, of CHF 5,580,484. The monetary value that was paid in 2021 under the MIP reflecting the 2020 business performance isapprox. CHF 2,139,756.
4. Members of the Executive Leadership Team participate in the pension plan of their employing entity, as appropriate.
5. Values under long-term incentives represent the fair value of performance shares that are expected to vest for the 2021 grant inorder to comply with Swiss reporting guidelines.
6. Ben Almanzar was appointed to the role of Chief Financial Officer on 1 February 2021. Barbara Tönz was appointed to the role ofChief Customer and Commercial Officer on 1 May 2021. Spyros Mello was appointed to the role of Strategy and Transformation
Director on 1 November 2021.
7. Michalis Imellos’ s employment ceased on 30 June 2021.

Credits and loans granted to governing bodies
In 2022, similar to 2021, there were no credits or loans granted to active or former members of theCompany’s Board of Directors, members of the Executive Leadership Team or to any related persons.
There are no outstanding credits or loans.

Coca-Cola HBC Integrated Annual Report 2022

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Alternative performance measures

Definitions and reconciliations of
Alternative Performance Measures (APMs)
1. Comparable APMs1
In discussing the performance of the Group, ‘comparable’ measures are used. In 2022, the Group
updated the definitions of items which are deducted from the directly reconcilable IFRS measures tocalculate comparable APMs so as to provide users more relevant information on its financial performance,
considering the impact of one-off events in the year as well as reporting by its peer group. More specifically,
comparable measures are calculated by deducting from the directly reconcilable IFRS measures theimpact of the Group’s restructuring costs, the mark-to-market valuation of the commodity hedging
activity, the acquisition, integration and divestment-related costs, the Russia-Ukraine conflict impact
and certain other tax items, which are collectively considered as items impacting comparability, due totheir nature. More specifically the following items are considered as items that impact comparability:

1. Restructuring costs
Restructuring costs comprise costs arising from significant changes in the way the Group conducts
business, such as significant supply chain infrastructure changes, outsourcing of activities andcentralisation of processes. These costs are included within the income statement line ‘Operating
expenses’; however, they are excluded from the comparable results so that the users can obtain abetter understanding of the Group’s operating and financial performance achieved from underlying
activity. Restructuring costs resulting from initiatives driven by the Russia-Ukraine conflict are presented
under the ‘Russia-Ukraine conflict impact’ item, to provide users complete information on the financial
implications of the conflict.

2. Commodity hedging
The Group has entered into certain commodity derivative transactions in order to hedge its exposure
to commodity price risk. Although these transactions are economic hedging activities that aim to manage
our exposure to sugar, aluminium, gas oil and plastics price volatility, hedge accounting has not been
applied in all cases. In addition, the Group recognises certain derivatives embedded within commodity
purchase contracts that have been accounted for as stand-alone derivatives and do not qualify forhedge accounting. The fair value gains or losses on the derivatives and embedded derivatives are
immediately recognised in the income statement in the cost of goods sold and operating expenses line
items. The Group’s comparable results exclude the gains or losses resulting from the mark-to-market
valuation of these derivatives to which hedge accounting has not been applied (primarily plastics) andembedded derivatives. These gains or losses are reflected in the comparable results in the period when
the underlying transactions occur, to match the profit or loss to that of the corresponding underlying
transactions. We believe this adjustment provides useful information related to the impact of oureconomic risk management activities.

3. Acquisition, integration and divestment-related costs or gains
Acquisition costs comprise costs incurred to effect a business combination such as finder’s fees,
advisory, legal, accounting, valuation and other professional or consulting fees as well as changes in
the fair value of contingent consideration recognised in the income statement. They also include any
gain from bargain purchase arising from business combinations, as well as any gain or loss recognisedin the income statement from the remeasurement to fair value of previously held interests and thereclassification to the income statement of items of other comprehensive income resulting fromstep acquisitions. Integration costs comprise direct incremental costs necessary for the acquiree tooperate within the Group. Divestment-related costs comprise transaction expenses, including advisory,
consulting, and other professional fees to effect the disposal of a subsidiary or equity method investment,
any impairment losses or write-downs to fair value less costs to sell recognised in the income statement
upon classification as held for sale and any relevant disposal gains or losses or reversals of impairment
recognised in the income statement upon disposal. These costs or gains are included within the income
statement line ‘Operating expenses’, however, to the extent that they relate to business combinations
or divestments that have been completed or are expected to be completed, they are excluded fromthe comparable results so that the users can obtain a better understanding of the Group’s operating
and financial performance achieved from underlying activity.

4. Russia-Ukraine conflict impact
As a result of the conflict between Russia and Ukraine, the Group recognised net impairment losses forproperty, plant and equipment, intangible assets and equity method investments as well as restructuringcosts, in connection with the new business model in Russia and adverse changes to the economic
environment. The Group also recognised incremental allowance for expected credit losses andwrite-offs of inventory and property, plant and equipment resulting from the Russia-Ukraine conflict.
The aforementioned net impairment losses are included within the income statement line ‘Exceptional
items related to Russia-Ukraine conflict’ so as to provide users with enhanced visibility over these
items considering their materiality, while remaining costs are included within ‘Operating expenses’ and‘Cost of goods sold’ lines of the income statement accordingly. Net impairment losses and other costs
directly attributable to the Russia-Ukraine conflict are excluded from the comparable results so thatthe users can obtain a better understanding of the Group’s operating and financial performance fromunderlying activity.

5. Other tax items
Other tax items represent the tax impact of (a) changes in income tax rates affecting the opening
balance of deferred tax arising during the year and (b) certain tax related matters selected based on
their nature. Both (a) and (b) are excluded from comparable after-tax results so that the users canobtain a better understanding of the Group’s underlying financial performance.

1. Comparable APMs refer to comparable cost of goods sold, comparable gross profit, comparable operating expenses, comparable EBIT, comparable EBIT margin, comparable Adjusted EBITDA, comparable profit before tax, comparable tax, comparable net profit
and comparable EPS.

245

246

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Alternative performance measures continued
1. Comparable APMs continued
The Group discloses comparable performance measures to enable users to focus on theunderlying performance of the business on a basis which is common to both periods for which thesemeasures are presented.
The reconciliation of comparable measures to the directly related measures calculated in accordancewith IFRS is as follows:

Reconciliation of comparable financial indicators (numbers in € million except
per share data)

As reported
Restructuring costs
Commodity hedging
Russia-Ukraine
conflict impact
Acquisition andintegration costs
Other tax items
Comparable

EBIT(6,054) 3,144 (2,355)
–
–
8
2
2
–

704
8
2

1,344
8
2

624
8
2

(208)
(2)
–

415
6
2

1.134
0.017
0.005

7

136

8

136

(14)

122

0.333

–
–
80
–
–
–
(6,051) 3,148 (2,260)

80
–
930

9
–
1,372

80
–
849

–
–
(224)

80 0.218– (0.001)
625 1.706

EBIT

2021
Adjusted
EBITDA

Profitbefore tax

Tax

Net
profit1

EPS (€)

799 1,152
21
21
(4)
(4)
14
14
–
–
831 1,183

735
21
(4)
14
–
767

(187)
(5)
1
–
3
(188)

547
17
(3)
14
3
578

1.499
0.045
(0.008)
0.039
0.009
1.584

Cost ofgoods soldAs reported
Restructuring costs
Commodity hedging
Acquisition costs
Other tax items
Comparable

1

Gross Operating
profit expenses(4,570) 2,598 (1,833)
–
–
21
(4)
(4)
–
–
–
14
–
–
–
(4,574) 2,594 (1,798)

Profitbefore tax

Tax

Net
profit1

EPS (€)

Figures are rounded.
1. Net profit and comparable net profit refer to net profit and comparable net profit respectively after tax attributable to owners of
the parent.

Reconciliation of comparable EBIT per reportable segment (numbers in € million)
Established

EBIT
Restructuring costs
Commodity hedging
Acquisition and integration costs
Russia-Ukraine conflict impact
Comparable EBIT

310
(6)
3
–
–
307

2022
Developing

113
(2)
4
–
–
115

286
15
(3)
3
301

105
3
(4)
3
107

Emerging

Consolidated

409
3
3
8
424

799
21
(4)
14
831

2. Organic APMs

Gross Operating
profit expenses

1

EBIT
Restructuring costs
Commodity hedging
Acquisition costs
Comparable EBIT

2021
Developing

Figures are rounded.

2022
Adjusted
EBITDA

Cost ofgoods sold

Established

Emerging

Consolidated

280
16
(3)
79
136
507

704
8
2
80
136
930

Organic growth
As of 1 January 2022 the Group moved its reporting to organic growth APMs. This was to enable a better
understanding of underlying business performance that is more consistent with how Coca-Cola HBC’s
peer group reports.
Organic growth enables users to focus on the operating performance of the business on a basis which
is not affected by changes in foreign currency exchange rates from year to year or changes in theGroup’s scope of consolidation (‘consolidation perimeter’) i.e. acquisitions, divestments and reorganisations
resulting in equity method accounting. Thus, organic growth is designed to assist users in better
understanding the Group’s underlying performance.
More specifically, the following items are adjusted from the Group‘s volume, net sales revenue andcomparable EBIT in order to derive organic growth metrics:(a) Foreign currency impact
Foreign currency impact in the organic growth calculation reflects the adjustment of prior-year net
sales revenue and comparable EBIT metrics for the impact of changes in exchange rates applicable tothe current year.
(b) Consolidation perimeter impact
Current year volume, net sales revenue and comparable EBIT metrics are each adjusted for the impact
of changes in the consolidation perimeter. More specifically adjustments are performed as follows:i. Acquisitions:
For current year acquisitions, the results generated in the current year by the acquired entities are notincluded in the organic growth calculation. For prior year acquisitions, the results generated in thecurrent year over the period during which the acquired entities were not consolidated in the prior year,
are not included in the organic growth calculation.
For current year step acquisitions where the Group obtains control of a) entities over which it previously
held either joint control or significant influence and which were accounted for under the equity method,or b) entities which were carried at fair value either through profit or loss or other comprehensive
income, the results generated in the current year by the relevant entities over the period during whichthese entities are consolidated, are not included in the organic growth calculation. For such step
acquisitions of entities previously accounted for under the equity method the share of results for therespective period described above, is included in the organic growth calculation of the current year.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Alternative performance measures continued
2. Organic APMs continued

Net sales revenue (€ m)

For such step acquisitions of entities previously accounted for at fair value through profit or loss any
fair value gains or losses for the respective period described above, are included in the organic growth
calculation. For such step acquisitions in the prior year, the results generated in the current year by therelevant entities over the period during which these entities were not consolidated in the prior year, are
not included in the organic growth calculation. However, the share of results or gains or losses from fairvalue changes of the respective entities, based on their accounting treatment prior to the step acquisition,
for the current-year period during which these entities were not consolidated in the prior year are
included in the organic growth calculation.

2021 reported
Foreign currency impact
2021 adjusted
Consolidation perimeter impact
Organic movement
2022 reported
Organic growth (%)

ii. Divestments:

Net sales revenue per unit case (€)1

For current year divestments, the results generated in the prior year by the divested entities over theperiod during which the divested entities are no longer consolidated in the current year, are included in
the current year’s results for the purpose of the organic growth calculation. For prior-year divestments,
the results generated in the prior year by the divested entities over the period during which the divested
entities were consolidated, are included in the current year’s results for the purpose of the organic
growth calculation.
iii. Reorganisations resulting in equity method accounting:
For current year reorganisations where the Group maintains either joint control or significant influence
over the relevant entities so that they are reclassified from subsidiaries or joint operations to joint ventures
or associates and accounted for under the equity method, the results generated in the current year by
the relevant entities over the period during which these entities are no longer consolidated, are includedin the current year’s results for the purpose of the organic growth calculation. For such reorganisationsin the prior year, the results generated in the current year by the relevant entities over the period during
which these entities were consolidated in the prior year, are included in the current year’s results for the
purpose of the organic growth calculation. In addition, the share of results in the current year of therelevant entities, for the respective period as described above, is excluded from the organic growth
calculation for such reorganisations.
The calculations of the organic growth and the reconciliation to the most directly related measurescalculated in accordance with IFRS are presented in the below tables. Organic growth (%) is calculatedby dividing the amount in the row titled ‘Organic movement’ by the amount in the associated row titled‘2021 reported’ or, where presented, ‘2021 adjusted’. Organic growth for comparable EBIT margin is theorganic movement expressed in basis points.

Reconciliation of organic measures
Volume (m unit cases)

2021 reported
Consolidation perimeter impact
Organic movement
2022 reported
Organic growth (%)

Established

590
–
54
644
9.1%

Full year 2022
Developing

416
–
63
479
15.2%

Emerging

Consolidated

1,407
335
(153)
1,589
(10.9)%

2,413
335
(36)
2,712
(1.5)%

2021 reported
Foreign currency impact
2021 adjusted
Consolidation perimeter impact
Organic movement
2022 reported
Organic growth (%)
Comparable EBIT (€ m)

2021 reported
Foreign currency impact
2021 adjusted
Consolidation perimeter impact
Organic movement
2022 reported
Organic growth (%)

Established

2,479
28
2,507
1
466
2,974
18.6%
Established

4.20
0.05
4.25
–
0.37
4.62
8.6%
Established

301
5
306
(3)
4
307
1.3%

Full year 2022
Developing

1,366
(32)
1,333
–
387
1,720
29.0%
Full year 2022
Developing

3.29(0.08)
3.21
–
0.38
3.59
11.9%
Full year 2022
Developing

107
(4)
102
–
13
115
12.7%

Emerging

Consolidated

3,324
230
3,553
755
196
4,505
5.5%

7,168
225
7,394
756
1,048
9,198
14.2%

Emerging

Consolidated

2.36
0.16
2.52
(0.15)
0.46
2.83
18.4%

2.97
0.09
3.06
(0.16)
0.49
3.39
15.9%

Emerging

Consolidated

424
38
461
52
(5)
508
(1.1)%

831
38
869
49
12
930
1.3%

Comparable EBIT margin (%)1

Established

Full year 2022
Developing

Emerging

Consolidated

2021 reported
Foreign currency impact
2021 adjusted
Consolidation perimeter impact
Organic movement
2022 reported
Organic growth (%)

12.1%
0.1%
12.2%
(0.1)%(1.8)%
10.3%-180bps

7.8%(0.1)%
7.7%–(1.0)%
6.7%-100bps

12.7%
0.2%
13.0%
(0.9)%(0.8)%
11.3%-80bps

11.6%
0.2%
11.8%
(0.3)%(1.3)%
10.1%-130bps

Figures are rounded.
1. Certain differences in calculations are due to rounding.

247

248

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Alternative performance measures continued
3. Other APMs
Adjusted EBITDA
Adjusted EBITDA is calculated by adding back to operating profit the depreciation and net impairmentof property, plant and equipment, the amortisation and impairment of intangible assets, the net
impairment of equity method investments, the employee share option and performance share costs
and items, if any, reported in line ‘Other non-cash items’ of the consolidated cash flow statement.
Adjusted EBITDA is intended to provide useful information to analyse the Group’s operating
performance excluding the impact of operating non-cash items as defined above. The Group also uses
comparable Adjusted EBITDA, which is calculated by deducting from Adjusted EBITDA the impact of:
the Group’s restructuring costs, the acquisition, integration and divestment-related costs or gains, themark-to-market valuation of the commodity hedging activity and the impact from the Russia-Ukraine
conflict. Comparable Adjusted EBITDA is intended to measure the level of financial leverage of theGroup by comparing comparable Adjusted EBITDA to Net debt.
Adjusted EBITDA and comparable Adjusted EBITDA are not measures of profitability and liquidity under
IFRS and have limitations, some of which are as follows: Adjusted EBITDA and comparable Adjusted
EBITDA do not reflect our cash expenditures, or future requirements for capital expenditures orcontractual commitments; Adjusted EBITDA and comparable Adjusted EBITDA do not reflect changes
in, or cash requirements for, our working capital needs; although depreciation and amortisation are noncash charges, the assets being depreciated and amortised will often have to be replaced in the future,
and Adjusted EBITDA and comparable Adjusted EBITDA do not reflect any cash requirements for such
replacements. Because of these limitations, Adjusted EBITDA and comparable Adjusted EBITDA should
not be considered as measures of discretionary cash available to us and should be used only as
supplementary APMs.

Free cash flow
Free cash flow is an APM used by the Group and defined as cash generated by operating activities after
payments for purchases of property, plant and equipment net of proceeds from sales of property, plantand equipment and including principal repayments of lease obligations. Free cash flow is intended tomeasure the cash generation from the Group’s business, based on operating activities, including theefficient use of working capital and taking into account its net payments for purchases of property, plantand equipment. The Group considers the purchase and disposal of property, plant and equipment asultimately non-discretionary since ongoing investment in plant, machinery, technology and marketing
equipment, including coolers, is required to support the day to day operations and the Group’s growthprospects. The Group presents free cash flow because it believes the measure assists users of thefinancial statements in understanding the Group’s cash generating performance as well as availability
for interest payment, dividend distribution and own retention. The free cash flow measure is used bymanagement for its own planning and reporting purposes since it provides information on operating
cash flows, working capital changes and net capital expenditure that local managers are most directly
able to influence.

Free cash flow is not a measure of cash generation under IFRS and has limitations, some of which are
as follows: free cash flow does not represent the Group’s residual cash flow available for discretionary
expenditures since the Group has debt payment obligations that are not deducted from the measure;
free cash flow does not deduct cash flows used by the Group in other investing and financing activities;
and free cash flow does not deduct certain items settled in cash. Other companies in the industry inwhich the Group operates may calculate free cash flow differently, limiting its usefulness as acomparative measure.

Capital expenditure
Capital expenditure is defined as payments for purchases of property, plant and equipment lessproceeds from sales of property, plant and equipment plus principal repayments of lease obligations.
The Group uses capital expenditure as an APM to ensure that the cash spending is in line with its overall
strategy for the use of cash.
The following table illustrates how Adjusted EBITDA, free cash flow and capital expenditure are calculated:2022€ million

2021€ million

Operating profit (EBIT)
Depreciation and impairment of property, plant and equipment,
including right-of-use assets
Amortisation and impairment of intangible assets
Employee performance shares
Impairment of equity method investments
Other non-cash items included in operating profit1
Adjusted EBITDA

704

799

485
15
17
53
71
1,344

336
1
15
–
–
1,152

Share of results of integral equity method investments
Loss / (Gain) on disposals of non-current assets
Cash generated from working capital movements
Tax paid
Net cash from operating activities

(42)
1
127
(196)
1,235

(34)
(28)
196
(142)
1,142

Payments for purchases of property, plant and equipment2
Principal repayments of lease obligations
Proceeds from sales of property, plant and equipment
Capital expenditure
Free cash flow

(532)
(65)
8
(589)
645

(514)
(63)
36
(541)
601

Figures are rounded.

1. Other non-cash items included in operating profit for 2022 relate to the net loss recognised in the income statement from the remeasurement to fair value of the previously held equity interest, the reclassification to the income statement of the Group’s share of othercomprehensive income and the gain from bargain purchase in connection with the change in control of Multon Z.A.O. group of companies (‘Multon’), For more details, refer to Note 24 of the consolidated financial statements for the year ended 31 December 2022.
2. Payments for purchases of property, plant and equipment for 2022 include €8.4 million (2021: €7.1 million) relating to repayment of borrowings undertaken to finance the purchase of production equipment by the Group’s subsidiary in Nigeria, classified as ‘Repaymentsof borrowings’ in the consolidated cash flow statement.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Alternative performance measures continued
3. Other APMs continued

1. Refer to ‘Comparable APMs’ section above.
2. Refer to the consolidated income statement.
3. Tax shield is calculated as comparable effective tax rate times finance costs, net, as illustrated below:

Net debt
Net debt is an APM used by management to evaluate the Group’s capital structure and leverage. Net
debt is defined as current borrowings plus non-current borrowings less cash and cash equivalents andfinancial assets (time deposits, treasury bills and money market funds), as illustrated below:

Current borrowings
Non‑current borrowings
Other financial assets
Cash and cash equivalents
Net debt

As at 31 December
2022€ million

2021€ million

337
3,083
(1,027)
(720)
1,673

382
2,556
(835)
(783)
1,320

Figures are rounded.

83
26%
22

Finance costs, net2
Comparable effective tax rate (%)4
Tax shield

68
25%
17

Figures are rounded.
4. Comparable effective tax rate is calculated as comparable tax divided by comparable profit before tax, as illustrated below:
Year ended
31 December 2022 31 December 2021
€ million€ million

224
849
26%

Comparable tax1
Comparable profit before tax1
Comparable effective tax rate (%)

188
767
25%

Figures are rounded.

Return on invested capital (‘ROIC’)
ROIC is an APM used by management to assess the return obtained from the Group’s asset base and isdefined as the percentage of comparable net profit excluding net finance costs divided by the fivequarter average capital invested in the business (‘capital employed’). Capital employed is defined as the
five-quarter average net debt and shareholders’ equity attributable to the owners of the parent, as
illustrated below. The Group presents ROIC because it believes the measure assists users of thefinancial statements in understanding the Group’s capital efficiency.
Year ended
31 December 2022 31 December 2021
€ million€ million

Comparable operating profit1
Plus: Share of results of non-integral equity method investments2
Less: Comparable tax1
Tax shield3
Comparable net profit excl. finance costs, net (a)

930
2
(224)
(22)
686

831
3
(188)
(17)
629

Average net debt5,7
Plus: Average equity attributable to owners of the parent6,7
Capital employed (b)

1,575
3,300
4,875

1,420
2,834
4,254

Return on invested capital (a/b)

14.1%

14.8%

Figures are rounded.

Year ended
31 December 2022 31 December 2021
€ million€ million

5. Refer to ‘Net debt’ section above for definition of net debt.
6. Equity attributable to owners of the parent is defined as total equity less non-controlling interests.
7. Five-quarter average net debt and equity attributable to owners of the parent are calculated as presented below:
2022
Net debt
Equity attributable to owners of the parent
2021
Net debt
Equity attributable to owners of the parent
Figures are rounded.

Q4 2021€ million

Q1 2022€ million

Q2 2022€ million

Q3 2022€ million

Q4 2022€ million

Average€ million

1,320
3,115

1,882
3,204

1,584
3,276

1,417
3,626

1,673
3,282

1,575
3,300

Q4 2020€ million

Q1 2021€ million

Q2 2021€ million

Q3 2021€ million

Q4 2021€ million

Average€ million

1,617
2,631

1,643
2,717

1,348
2,713

1,173
2,992

1,320
3,115

1,420
2,834

249

250

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Coca-Cola HBC Integrated Annual Report 2022

Assurance statement

Independent assurance statement for the 2022
Integrated Annual Report
To the management and stakeholders of Coca-Cola HBC AG:
denkstatt GmbH was commissioned by Coca-Cola HBC AG (hereinafter referred to as “the Company”)
to provide independent third-party assurance for the printed and downloadable pdf versions of theCompany’s 2022 Integrated Annual Report (hereinafter referred to as “the Report”) in accordance with
the AA1000 Assurance Standard as well as the Global Reporting Initiative (GRI) Universal Standards
2021. We have reviewed sustainability-related data and content in the Report and in the 2022 GRI
Content Index. Financial data were not reviewed as part of this engagement. The assurance engagement
covered the nature and extent of the Company’s application of the principles of inclusivity, materiality,
responsiveness, and impact, as described in the AA1000 Series of Standards (AA1000AP, 2018).
The application level “in accordance with” of the GRI Universal Standards 2021 was verified.
denkstatt is an independent professional services company. Our team of experts has extensive
professional experience in assurance engagements related to non-financial information and sustainability
management, meaning it is qualified to conduct this independent assurance engagement. denkstatthas implemented a certified quality and environmental management system which complies with therequirements of ISO 9001:2015 and ISO 14001:2015, and accordingly maintains a comprehensive
quality control system.

Management responsibilities
The Company’s management (Management) is responsible for preparing the Report, statements
within it, and related online content. Management is also responsible for identifying stakeholders andmaterial issues, defining commitments with respect to sustainability performance, and establishing andmaintaining appropriate performance management and internal control systems, from which reported
information is derived.
Additionally, Management is responsible for establishing data collection and internal control systems toensure reliable reporting, for specifying acceptable reporting criteria, and for selecting data to be collected
for the purposes of the Report. Management responsibilities also extend to preparing the Reportin accordance with the GRI Universal Standards (2021).

Assurance provider’s responsibilities
Our responsibilities are to:• express our conclusions and make recommendations regarding the nature and extent of the Company’s
adherence to the AA1000 Accountability Principles (2018), and• express our conclusions on the reliability of the information in the Report, and whether it is in accordancewith the criteria in the GRI Universal Standards (2021).
We did not perform any tasks or services for the Company or other clients in 2022 which would leadto a conflict of interest. We were not responsible for the preparation of any part of the Report.

Scope of assurance, standards, and criteria used
We have fulfilled our responsibilities to provide appropriate assurance that the information in the Report
is free from material misstatements. We planned and carried out our work based on the GRI Universal
Standards (2021) and the AA1000 Series of Standards. We used the criteria in AA1000AS (AA1000
Assurance Standard v3) to perform a Type 2 engagement and to provide a high level of assurance
regarding the nature and extent of the Company’s adherence to the principles of impact, inclusivity,
materiality, and responsiveness. The Company has chosen to report in accordance with the GRI Universal
Standards (2021) and the assurance verified this accordingly.

Methodology, approach, limitations and scope of work
We planned and carried out our work in order to obtain all evidence, information, and explanations that
we considered necessary to fulfil our responsibilities. We completed a wide range of activities in orderto gather necessary evidence, including:• Gathering information regarding the Company’s adherence to the principles of impact, due diligence,
inclusivity, materiality, sustainability context, completeness, and responsiveness as required by the
GRI and AA1000, and conducting interviews with members of the management, staff from the People
and Culture Department, the Legal Affairs Department (including the Risk team), the Internal Control
Department, the Commercial Department, the Supply Chain Department (including the Procurement
team, the Product Quality, Safety and Environment team, the Fleet team and the Cold Drink Equipmentteam), Investor Relations department and the Corporate Affairs and Sustainability Department aswell as managers from other Group functions. In particular, we verified the management commitment
to the above-mentioned principles, and whether they are embedded at market level, as well as whether
systems and procedures are in place to support compliance with these principles.
• Key topics in the interviews conducted at Group level related to the materiality analysis, i.e. healthand nutrition; responsible marketing; employee wellbeing and engagement; vehicle fleets; corporate
governance; business ethics; compliance and anti-corruption; sourcing; product quality and integrity,and food safety; energy, emissions and climate change; cold drink equipment (coolers); TCFD andclimate risk assessment; packaging; recycling and waste management; water stewardship; the World
Without Waste initiative; #YouthEmpowered and other community programmes (including community
investments); human rights and diversity; business risks and opportunities; and social impact.
• Conducting interviews at country headquarters in Austria, Hungary, Poland, Bulgaria, North
Macedonia, Nigeria, Serbia and Egypt in order to assure that the information required for theengagement was complete.
• Performing audits in eight manufacturing plants, the majority of which were located in emerging
markets: Edelstal (Austria), Dunaharaszti (Hungary), Radzymin (Poland), Bankya (Bulgaria), Skopje(North Macedonia), Challawa (Nigeria), Rosa (Serbia) and Sadat (Egypt).
• Making enquiries and conducting spot checks to assess the implementation of Company policies(at plant, market (BU) and Group level).
• Making enquiries and conducting spot checks regarding necessary documentation for assessing
the current data collection systems, and the procedures in place to ensure reliable and consistentreporting from the plants to Group level.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Assurance statement continued• Verifying all three inventory scopes (Scopes 1, 2 and 3) as defined by the GHG Protocol (Corporate
Standard), including progress against emission reduction targets, reported changes in emissions
compared with the baseline year (2010 and 2017) and the figures for absolute emissions and emissions
intensity in 2022.
• Verifying the materiality process and materiality assessment as defined by the GRI Universal
Standards (2021).
• Verifying the GRI Content Index, which was published in a separate section of the Company website,
to ensure consistency with the requirements for reporting in accordance with the GRI Universal
Standards (2021).
• Conducting additional interviews with four external stakeholders representing different stakeholder
groups (i.e., business partners, suppliers, investors, and non-governmental organisations) during theAnnual Stakeholder Forum event held in December 2022.
The scope of assurance covers all information relevant to sustainability in the Report and focuseson Company systems and activities during the reporting period. However, the following chapter were
not covered in the sustainability assurance process:• Financial Statements and Swiss Statutory Reporting.
In-person audits were conducted in the following countries: Austria, Bulgaria, Egypt, Hungary, North
Macedonia, Poland and Serbia. Due to political risks, the audit in Nigeria was conducted virtually, whereby
video conferencing technology was used to facilitate virtual tours of manufacturing plants.
The facilities and operations in Belarus, Russia and Ukraine were included in the assurance work,
although in-person audits at local level were not conducted for these countries.

Conclusions
On the basis of our work, we found nothing to suggest that the information in the 2022 Integrated Annual
Report and in the 2022 GRI Content Index is inaccurate or contains material misstatements. Any errors
or misstatements identified during the engagement were corrected prior to the Report being published.

Positive developments• Sustainability is deeply embedded in the Company culture. This is evident in well-structured, easily
accessible guidelines which ensure proper implementation of Company-wide standards, e.g. theCode of Business Conduct, the Inclusion and Diversity Policy, the Mission 2025 Guidebook, Healthand Safety Whitebook, and HR Whitebook. It is also reflected in the organisational structure andacross all functions, with a clear set of responsibilities for sustainability strategy, from factory-levelto senior management.
• During the reporting period the Company published its new biodiversity commitment, pledging toachieve a net positive impact on biodiversity in critical areas by 2040 and to eliminate deforestationin the supply chain by 2030. The commitment underlines the importance of the topic and the strong
implementation and integration of biodiversity in the Company’s strategy.

• The Company demonstrates a very strong commitment to its goals. Most operations have a strong
track record of collecting and documenting sustainability data. Data traceability has significantly
improved over recent years, due to well-structured monitoring and reporting processes at plant,
market, and Group level, as well as specialised software.
• The Company fully understands the links between business risks and sustainability issues. An advanced
risk management system has been developed in recent years. The detailed quantitative analysisof climate-related water risks (physical and transitional) performed by the Company in 2021, using
established tools, can be considered an example of best-practice. In 2022 the impact of extreme
weather events on the production sites was quantified. Also, reporting the connection between risk
management and sustainability topics has been improved and enhanced. Procedures for identifying
and mitigating risks comprehensively cover sustainability-related risks, e.g. by integrating the climate
risk management process in enterprise risk management in line with the TCFD recommendations.
Specific plans for further progress in aligning with the TCFD recommendations in the coming years,
such as further quantitative climate risk assessments, demonstrate clear commitment to the issue.
• The Company has put great effort into developing the #YouthEmpowered programme by increasing
numbers of participants as well as establishing a data monitoring and reporting system with a highlevel of maturity. #YouthEmpowered is the flagship social programme of the Company’s Mission
2025 sustainability commitments. It aims to support young people and increase their employability
by providing modular education opportunities in soft and/or business skills. The reboot of the training
programme in 2023 is focusing on skills closer to the business model including those connected withhotel, restaurant and café (HORECA) operations, as well as customer and sales training topics.
• The Company started a pilot project on supplier-specific emission factors as a joint initiative with
the Coca-Cola System to mirror efforts towards decarbonisation being made in the supply chain.
• In 2022, the Company issued its first green bond to support and enhance its efforts towards achieving
its sustainability targets. The Company is also working to expand partnerships and collaboration
networks, to collectively work on achieving its NetZeroby40 and Mission 2025 commitments.

Findings and conclusions regarding adherence to the AA1000
principles of inclusivity, materiality, responsiveness, impact,
and specific performance-related information:
Inclusivity• Group level: The Company has implemented a comprehensive and efficient stakeholder engagement
process at Group level. Its cornerstones are the annual internal and external materiality survey andthe Annual Stakeholder Forum (held online in December 2022).
• Market and plant level: Stakeholder engagement activities at market and plant level are in greater
evidence. The Company is well aware of stakeholder concerns, and it consistently integrates theviews of stakeholders at all levels.
• Overall, the whole stakeholder engagement process is professional and of high quality. A strong
commitment to the process was evident across the various country audits.

251

252

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Assurance statement continued
Materiality• Group level: A robust process for defining topics material for the Company is in place. The materiality
assessment process considers stakeholder expectations with regard to relevant topics. This year
the Company also conducted its own impact assessment, analysing how significantly each material
topic impacts society and the environment, based on the scale of the impact, severity, likelihood.
The results were used to confirm the impact assessment results from the stakeholder survey. By using
the categories impact, severity and likelihood, the Company is preparing itself for the upcoming
requirements of the Corporate Sustainability Reporting Directive (CSRD). The material topics identified
during the assessment in 2022 provided the basis for the sustainability strategy and reporting.
• Market and plant level: As various markets are publishing sustainability reports in combination withsocio-economic impact studies, formalised processes for carrying out the materiality assessment
have been more strongly implemented throughout the organisation.
• It is recommended to continue using the ‘double materiality’ concept (also used in the CSRD) as wellas to continue work to combine the two perspectives of¬ financial materiality, and environmental
and social materiality ¬with a risks and opportunities assessment from both the financial andnon-financial perspectives.
• The product portfolio is under development, with the integration and growth of new product andservice segments such as coffee drinks, snacks, and premium spirits. The majority of the social andenvironmental impacts of these new segments have already been included in the scope of ESG
assessment. We recommend further assessment and even greater integration of these new productsegments into the Company’s sustainability management approach including the development andadaptation of guidelines and policies.

Responsiveness• The Company demonstrated a fast and professional response to the Russia-Ukraine war in its
support for local employees and communities via product donations, financial contributions andvolunteering activities.
• Support for external stakeholders in regard to COVID-19 in form of product donations and financial
contribution continued in 2022.
• Operations in Russia transitioned to a local, self-sufficient business, which is managed by a local teamand focused on local brands.

Impact• Group level: The Company has robust processes in place for understanding, assessing, and managing
its impacts, including risk management and strategy development. This year the company placed astrong emphasis on linking together risk assessment, materiality assessment and sustainability topics.
• Market level: Sound socio-economic impact studies are conducted in individual markets on aregular basis, to measure the organisational impact on communities. Results from these studies are
summarised at Group level to disclose the organisation’s impact on stakeholders, the society andon the Company itself.

• As part of the Mission 2025 strategy, the Company has published a strong set of commitments witha long-term perspective, covering a wide range of environmental and social impact areas along thevalue chain. In particular, the Company’s commitment to NetZeroby40 demonstrates its ambitious
environmental roadmap.

Additional conclusions and recommendations• The Company grew its business by acquiring further companies such as bottling plants in Egypt, Lurisia
in Italy, and Teplice in the Czech Republic, as well as a preform producer. The Company has started
integrating them into their group strategy and reporting. Nevertheless, this integration process is notcomplete. Going forward, a strong emphasis should be placed on incorporating these new acquisitions
into the company vision, guidelines and policies, as well as data monitoring and reporting.
• The Company demonstrates excellent engagement and know-how in relation to packaging waste
management, reflecting its ambitious targets in this area. However, efforts need to be increased,since the Company’s 2025 targets for use of recycled PET and/or PET from renewables, as well as
packaging collection for recycling, do not currently appear to be within reach. Therefore, ourrecommendation is to develop a solid and clear strategy as well as long-term goals in regard to this
topic with a continued focus on refillable and package-less systems.
• Although the Company has heavily invested in achieving its safety ambitions, it has to continue
exploring ways of increasing awareness of behavioural-based safety and strengthen the safety
culture to reverse the trend of the rising lost time accident rate. Additionally, the Company should
further strengthen workplace accountability practices within its operations, especially in emerging
markets, with a focus on third-party contractors.
• The Company has set already commitments beyond 2025 (related to the Science-based carbon
reduction targets by 2030, NetZeroby40, food waste and loss, and biodiversity), and we recommend
the work on updating its sustainability strategy and targets to continue as the Mission 2025 goals will
be realised very soon.

Willibald Kaltenbrunner
Lead Auditor
denkstatt GmbH
Advisory for Sustainable Development
Vienna, 10 March 2023

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Shareholder information
We take great pride in being regarded as atransparent and accessible company in all ourcommunications with investment communities
around the world. We engage with key financial
audiences, including institutional investors,
sell-side analysts and financial journalists, as wellas our Company’s shareholders. The investor
relations department manages the interaction
with these audiences by attending ad hoc
meetings and investor conferences throughout
the year, in addition to the regular meetings andpresentations held at the time of our results
announcements.

ATHEX: EEE

Geographic concentration (%)

In € per share
Close
High
Low
Market capitalisation (€ million)

22.60
31.97
17.995
8,287

30.26
32.80
24.18
11,071

26.42
34.24
16.99
9,625

In 2022, the share capital of Coca-Cola HBC increased by the issue of 290,677 new ordinary sharesfollowing the exercise of stock options pursuant to the Group’s employee stock option plan. Total
proceeds from the issuance of the shares under the stock option plan amounted to €4.7 million.
27%
25%
34%
7%
8%

North America
Western Europe
UK
Nordic
Other

Athens Exchange
Ticker symbol: EEE
ISIN: CH019 825 1305
Reuters: EEEr.AT
Bloomberg: EEE GA

Following the above changes, and including 5,386,717 ordinary shares held as treasury shares,
on 31 December 2022 the share capital of the Group amounted to €2,024.3 million and comprised
372,086,095 shares with a nominal value of CHF 6.70 each.

Major shareholders
The principal shareholders of the Group are Kar-Tess Holding (a Luxembourg company), which holds
approximately 23%, and The Coca-Cola Company, which indirectly holds approximately 21% of theGroup’s issued share capital.

Dividends
For 2022, the Board of Directors has proposed a €0.78 dividend per share, up 9.9% year on year
representing a 46% pay-out ratio. Dividend pay-out ratio target is 40-50%,
This compares with a dividend payment of €0.71 per share in 2021. For more information on ourdividend policy and dividend history, please visit our website at www.coca-colahellenic.com

Financial calendar
3 May 2023
17 May 2023
9 August 2023
2 November 2023

Credit ratingStandard & Poor’s: L/T BBB+, S/T A2, negative outlook
Moody’s: L/T Baa1, S/T P2, stable outlook

First quarter trading update
Annual General Meeting
Half-year financial results
Third quarter trading update

Corporate website
www.coca-colahellenic.com

Share price performance
In £ per share
Close
High
Low
Market capitalisation (£ million)

2020

Share capital

Coca-Cola HBC AG (LSE: CCH) was admitted to the premium listing segment of the Official List of the
UK Listing Authority and to trading on the London Stock Exchange’s main market for listed securities
on 29 April 2013. With effect from 29 April 2013, Coca-Cola HBC AG’s shares are also admitted on the
Athens Exchange (ATHEX: EEE). Coca-Cola HBC AG has been included as a constituent of the FTSE
100 and FTSE All-Share Indices from 20 September 2013.

LSE: CCH

2021

Source: Bloomberg

Listings

London Stock Exchange
Ticker symbol: CCH
ISIN: CH019 825 1305
SEDOL: B9895B7
Reuters: CCH.L
Bloomberg: CCH LN

2022

Shareholder and analyst information
2022

2021

2020

19.73
26.87
14.605
7,235

25.55
27.84
21.60
9,348

23.77
28.83
14.94
8,660

Shareholders and financial analysts can obtain further information by contacting:
Investor Relations
Tel: +30 210 618 3100
Email: investor.relations@cchellenic.com
IR website: www.coca-colahellenic.com

253

254

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

2022 SASB Index

2022 SASB Index

The majority of the information required by the Sustainability AccountingStandards Board (SASB) framework is included in the 2022 Integrated
Annual Report (IAR) and 2022 GRI Content Index. Part of the informationrefers to our public website https://www.coca-colahellenic.com/
The Coca-Cola HBC AG 2022 IAR has been prepared in accordance with
the Global Reporting Initiative Standards (GRI Universal Standards 2021).
It has been independently assured by denkstatt GmbH. The independent
assurance statement is on pages 250-252 of the 2022 IAR.
All the numbers refer to total CCHBC markets excluding Egypt unlessotherwise stated.

Table 1. Sustainability disclosure topics & accounting metrics
Topic
Fleet fuel management

Accounting metric
Fleet fuel consumed
Percentage renewable

Category
Quantitative

Operational energy consumed

Energy management

Gigajoules (GJ)
Percentage (%)

CodeFB-NB-110a.1

Response
887
0%

Gigajoules (GJ)

6,478

Percentage (%)

FB-NB-130a.1 64%

Percentage renewable

Percentage (%)

20%

Total water withdrawn

Thousand cubic
metres (m³)

25,946Percentage grid electricity

Total water consumed

Water management

Unit of measure

Quantitative

Quantitativeand percentage of each in regions with High or Extremely HighBaseline Water Stress
Description of water management risks and discussion ofstrategies and practices to mitigate those risks

Thousand cubic
metres (m³)
Percentage (%)
n/aDiscussion
and analysis

FB-NB-140a.1

16,08036%
2022 IAR, Water stewardship (page 52), and Risk sections (pages 59-81).

FB-NB-140a.2 2022 GRI Content Index (GRI 303: Water and Effluents).
CCHBC website_Sustainability section_Water stewardship

Revenue from: zero- and low‑calorie beverages

EUR€1,526.1 million only from Sparkling soft drinks (SSD) portfolio,no added sugar beverages

EUR

Not reported; we report towards our Mission 2025 commitment for calorie
FB-NB-260a.1 reduction per 100ml sparkling soft drinks by 25% (2025 vs. 2015): in 2022 wereduced the calories in our sparkling soft drinks by 17% vs. 2015.

24.8% of total SSD revenue.

Health & nutrition

Quantitative
artificially sweetened beverages

EUR

CCHBC website_Sustainability section_Nutrition
Not reported.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

2022 SASB Index continued
Table 1. Sustainability disclosure topics & accounting metrics continued
Topic

Accounting metric

Category

Percentage of advertising impressions (1) made on childrenand (2) made on children promoting products that meet dietaryguidelines

Unit of measure

Code

Percentage (%)

Not reported. As a member of both the Coca-Cola System and UNESDA, weabide by their respective responsible marketing guidelines. In addition, we havea responsible marketing policy for alcoholic beverages, while our strategic
approach towards marketing to children is covered by our health and wellness
FB-NB-270a.1
policy.

Quantitative

Response

https://www.unesda.eu/advertising-marketing-practices/
Health and Wellness Policy

Product labelling &marketing

Revenue from products labelled as (1) containing geneticallymodified organisms (GMOs) and (2) non-GMO

Reporting currency(1) None – we don’t produce/sell GMO products.
FB-NB-270a.2 (2) non-GMO: €9,198.4 million (100% of the portfolio).

Quantitative

CCHBC website_GMO Policy
Number of incidents of non-compliance with industry or
regulatory labelling and/or marketing codes

NumberQuantitative

Three incidents of non-compliance with regulatory labelling (with zero fines)
and five with industry marketing codes in 2022, with mitigation plans in place for
FB-NB-270a.3 all of the above incidents.
Refer to the 2022 GRI Content Index (417-2 and 417-3).

Total amount of monetary losses as a result of legal
proceedings associated with marketing and/or labelling
practices

Packaging lifecycle
management

Reporting currency
Quantitative

Total amount of monetary losses: €0 in 2022.
FB-NB-270a.4 Refer to the 2022 GRI Content Index (417-2 and 417-3).

Total weight of packaging

Metric tonnes (t)786,889(2) percentage made from recycled and/or renewable materials

Percentage (%)

10.5% rPET (placed on the market); 33% recycled glass; 49% recycled
aluminium

Quantitative(3) percentage that is recyclable, reusable,
and/or compostable
Discussion of strategies to reduce the environmental impact of
packaging throughout its lifecycle

Percentage (%)
Discussion
and analysis

FB-NB-410a.2

Rate

Suppliers’ social and environmental responsibility audit:
non-conformance rate and associated corrective action rate
Environmental & socialfor (a) major and (b) minor non-conformances
impacts of ingredient supply
chain

n/a

FB-NB-410a.1

Quantitative

100% of primary packaging (recyclable by design)
CCHBC website_Sustainability section_World without waste
2022 GRI Content Index (2-6, 308-1,308-2, 407-1, 408-1, 409-1, 414-1)

FB-NB-430a.1

CCHBC website_Sustainable sourcing and Our suppliers sections
CCHBC website_Sustainability section_Sourcing
CCHBC website_Supplier Guiding Principles

Percentage of beverage ingredients sourced from regions withHigh or Extremely High Baseline Water Stress

Ingredient sourcing

List of priority beverage ingredients and description of sourcing
risks due to environmental and social considerations

Percentage (%) by cost
Quantitative

FB-NB-440a.1

n/aDiscussion
and analysis

0.8% of ingredients supplier spend is in high water risk areas as per ourassessment by using WWF Water Risk Filter (excluding Egypt).
3.7% of ingredients supplier locations are in high water risk areas as per ourassessment by using WWF Water Risk Filter (excluding Egypt).
CCHBC website_Sustainability section_Sourcing

FB-NB-440a.2 2022 GRI Content Index (2-6, 308-1, 308-2, 407-1, 408-1, 409-1, 414-1)
CCHBC website_Sustainable sourcing and Our suppliers sections

255

256

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

2022 SASB Index continued
Table 2. Activity metrics
Activity metric

Category

Unit of measure

Code

Response

Volume of products sold

Quantitative

Millions of hectolitres (Mhl)

FB-NB-000.A

14,434.28 (excluding Egypt, which was acquired in January 2022 and thetransition process is ongoing).

Number of production facilities

Quantitative

NumberFB-NB-000.B

14,981.38 (including Egypt).
55 production facilities for non-alcoholic beverages (excluding Egypt).
60 production facilities for non-alcoholic beverages (including Egypt).

Total fleet road miles travelled

Quantitative

Kilometres

FB-NB-000.C

321,223,574

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Glossary
AI
Artificial Intelligence.
B2B
Business-to-business.
Baltics; Baltic States
Estonia, Latvia and Lithuania.
Basis points (bps)One hundredth of one percentage point(used chiefly in expressing differences).
Bottlers
Business entities that sell, manufacture, anddistribute beverages of The Coca-Cola Company
under a franchise agreement.

CO2eq; CO2e
A carbon dioxide equivalent or CO2 equivalent,abbreviated as CO2 eq or CO2e is a metricmeasure used to compare the emissions fromvarious greenhouse gases (GHG) on the basis of
their global-warming potential (GWP), by converting
amounts of other gases to the equivalent amountof carbon dioxide with the same global warming.
Coca-Cola HBC; CCHBC; CCH
Coca‑Cola HBC AG, and, as the context may
require, its subsidiaries and joint ventures; also,
the Group, the Company.
Coca-Cola System
The Coca-Cola Company and its bottling partners.

Bottling plant
A beverage production facility, including
associated warehouses, workshops, and otheron-site buildings and installations.

Cold drink equipment (CDE)
A generic term encompassing point-of-saleequipment such as coolers (refrigerators), vending
machines and post‑mix machines.

CAGR
Compound annual growth rate.

Comparable adjusted EBITDA
We define comparable adjusted EBITDA
as operating profit before deductions fordepreciation and impairment of property, plantand equipment (included both in cost of goods
sold and in operating expenses), amortisation andimpairment of intangible assets, impairment ofequity method investments, employee shareoption and performance shares compensationand other non‑cash items, if any; further adjusted
for restructuring costs, acquisition and integration
costs, the impact from the Russia-Ukraine conflict
and the mark to market valuation of commodity
hedging activity. Refer also to ‘Alternative
performance measures’ section.

Capital expenditure; CapEx; Capex; CAPEX
Gross CapEx is defined as payments for purchasesof property, plant and equipment. Net CapEx isdefined as payments for purchases of property,
plant and equipment less proceeds from salesof property, plant and equipment plus principal
repayments of lease obligations. Refer also to‘Alternative performance measures’ section.
COGS
Cost of Goods Sold.
Combined Heat and Power (CHP) unit
Also called tri-generation units, these can produce
power, heat, cooling and CO2 in a combined
process that is up to 40 percent more efficientthan separate processes.
CO2
Carbon dioxide, a greenhouse gas.

Comparable net profit
Refers to net profit after tax attributable toowners of the parent adjusted for restructuringcosts, acquisition and integration costs, theimpact from Russia-Ukraine conflict, the mark tomarket valuation of commodity hedging activity
and certain other tax items. Refer also to‘Alternative performance measures’ section.

Comparable operating profit (EBIT)
Comparable operating profit (EBIT) refers to profit
before tax excluding finance income/ (costs) andshare of results of non-integral equity-method
investments, adjusted for restructuring costs,
acquisition and integration costs, the impact from
Russia-Ukrainian conflict and the mark to market
valuation of commodity hedging activity. Referalso to ‘Alternative performance measures’ section.
Comparable operating expenditure
Comparable operating expenditure refers tooperating expenditure adjusted for restructuringcosts, acquisition and integration costs, theimpact from Russia-Ukraine conflict and the markto market valuation of certain commodity hedging
activity. Refer also to ‘Alternative performancemeasures’ section.
Concentrate
Base of a beverage, to which water and otheringredients are added to produce beverages.
It may contain concentrated plant extracts,
fruit juices, colourings and other components.
Consumer
Person who drinks Coca-Cola HBC products.
Customer
Retail outlet, restaurant or other operation thatsells or serves Coca-Cola HBC products directly
to consumers.
Dividend policy
Our Board of Directors approved a dividend policy,
effective from 2022, aiming to increase dividend
payments progressively with a medium-term target
pay-out ratio of 40-50% on comparable net profits.
Energy use ratio
The KPI used by Coca‑Cola HBC to measureenergy consumption in the bottling plants,
expressed in megajoules of energy consumed
per litre of produced beverage (MJ/lpb).
ELT
Executive Leadership Team.

Emissions (Scope 1 and 2) or GHG emissions(Scope 1 and 2)
Emissions of CO2 and other greenhouse gases
from fuel combustion and energy use in
Coca‑Cola HBC’s own operations in bottling,storage, distribution and in offices.
Emissions (Scope 1, 2 and 3) or GHG emissions(Scope 1, 2 and 3)
Global emissions of CO2 and other greenhousegases from Coca‑Cola HBC’s wider value chain(raw materials, product cooling, etc.).
ESG
Environment, Social and Governance, referring to
the three key factors affecting the sustainability
and ethical impact of a business or company.
FMCG
Fast‑moving consumer goods.
FTE
Full time equivalent, referring to a unit to measureemployed people in a way that makes themcomparable, even though they may work different
hours each week.
GDP
Gross domestic product.
GHGs
Greenhouse gases. The major GHGs are carbon
dioxide (CO2), methane (CH4) and nitrous
oxide (N20).
GRI
Global Reporting Initiative, a global standard forsustainability reporting.
HoReCaDistribution channel encompassing hotels,
restaurants and cafés.
IASBInternational Accounting Standards Board.
IFRS
International Financial Reporting Standards, issued
by the International Accounting Standards Board.

257

258

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
ReportingCoca-Cola HBC Integrated Annual Report 2022

Supplementary
Information

Glossary continued
IIRC
The International Integrated Reporting Council,
a global coalition of regulators, investors,
companies, standard-setters, the accounting
profession and NGOs. The coalition is promoting
communication about value creation as the next
step in the evolution of corporate reporting.
IMCR
Incident Management and Crisis Resolution.
Ireland
The Republic of Ireland and Northern Ireland.
Italy
Territory in Italy served by Coca‑Cola HBC(excludes Sicily).
KeelClip™
Paper packaging for multipack cans with a central‘keel’, like on a boat, that secures the pack.
KPIs
Key Performance Indicators.
Litre of produced beverage (lpb)
Unit of reference to show environmental
performance relative to production volume.
MarketWhen used in reference to geographic areas, acountry in which Coca-Cola HBC does business.
Mission 2025
2025 sustainability commitments with 17 goals.
Developed in late 2018, the goals are based on our
stakeholder materiality matrix and aligned with theUnited Nations Sustainable Development Goals(SDGs) and their targets. The six key focus areas
reflect our value chain: reducing emissions; water
reduction and stewardship; packaging (World
Without Waste); ingredient sourcing; nutrition;and our people and communities.
MultonMulton refers to Multon Partners, our operationin Russia since 5 August 2022. More details on
the regulatory news release can be found oncompany’s website.

NetZeroby40
Long-term commitment to achieving net zero
emissions across our entire value chain (Scope 1,
2 and 3) by 2040. The commitment is endorsedby the “We Mean Business” coalition and was
published in October 2021. More details on our
Scope 1, 2 and 3 emissions are disclosed in the2022 GRI Content Index. Please see also our 2022
CDP Climate response: https://www.cocacolahellenic.com/content/dam/cch/us/
documents/a-more-sustainable-future/
mission-2025/CDP-RESPONSE-2022_
COCACOLA-HBC-AG_CLIMATE_CHANGE.pdf.
downloadasset.pdf.

ROIC
Return on invested capital. ROIC is the percentage
return that a company makes over its invested
capital. We define ROIC as the percentage ofcomparable net profit excluding net financecosts divided by the five-quarter capital employed.
Capital employed is calculated as the five-quarter
average net debt and shareholders’ equity
attributable to the owners of the parent. Refer also
to ‘Alternative performance measures’ section.

NetZeroby40 information from our website:

SAP
A powerful software platform that enables us tostandardise key business processes and systems.

https://www.coca-colahellenic.com/
en/a-more-sustainable-future/netzeroby40
NARTD
Non‑alcoholic ready‑to‑drink.
NGOs
Non‑governmental organisations.
PET
Polyethylene terephthalate, a form of polyester
used in the manufacturing of beverage bottles.
Per-capita consumption
Average number of servings consumed perperson per year in a specific market. Coca Cola
HBC’s per capita consumption is calculated bymultiplying our unit case volume by 24 and dividing
by the population.
Premium sparkling
Includes Trademark Coca-Cola, Fanta, Sprite,
Schweppes, Tuborg and Kinley sparkling
beverages.
Ready-to-drink (RTD)
Drinks that are pre‑mixed and packaged, readyto be consumed immediately with no further
preparation.

rPET
Recycled PET refers to any PET material thatcomes from a recycled source rather than theoriginal, unprocessed petrochemical feedstock.

SBTN
The Science Based Targets Network is acollaboration of leading global non-profits andmission-driven organisations working together
to equip companies as well as cities with theguidance to set science-based targets for allof Earth’s systems.
SDG
UN Sustainable Development Goals. On 25
September 2015, countries adopted a set of
17 goals to end poverty, protect the planet andensure prosperity for all as part of a new sustainable
development agenda. Each goal has specifictargets to be achieved by 2030.
Senior leaders; senior management
Our top 300 business leaders, which includes
country function heads, Group sub-function
heads and the Executive Leadership Team (ELT),
including the CEO.
Serving
237ml or 8oz of beverage, equivalent to 1/24
of a unit case.

Sparkling beverages
Non‑alcoholic carbonated beverages containing
flavourings and sweeteners, but excluding, among
others, waters and flavoured waters, juices and juice
drinks, sports and energy drinks, teas and coffee.
Still and water beverages
Non‑alcoholic beverages without carbonation
including, but not limited to, waters and flavoured
waters, juices and juice drinks, sports and energy
drinks, teas and coffee.
Socio-economic impact
In conducting socio-economic studies, we use
input-output modelling to generate estimatesof jobs supported and economic value added.
Data we use in this process includes our financial
information (revenues, expenses, taxes, sales
volume and profits) as well as some data fromThe Coca-Cola Company. While rigorous, theprocess involves statistical modelling, whichshould be considered when interpreting and using
the results from the studies. Modelling enables anassessment of three key dimensions of impact:• direct: immediate effect in terms of
employment, wages and output• indirect: subsequent effect in the supply chain• induced: effect caused by staff spend on goods
or services
We do not conduct socio-economic studies for allof our markets every year; studies are conducted
for each market on a rolling basis. In 2022, weupdated the studies for ten markets, adding thisinformation to the aggregate results from allsocio-economic impact studies for the period
2018-2022.
Notes to the socio-economic contributions
presented on page 15 of this report:• Numbers presented are aggregated based on
the local socio-economic studies from
Coca-Cola HBC markets published between
2018 and 2022, except for North Macedonia
where the report is from 2017.

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Glossary continued• All KPIs represent annual impact.
• Where applicable and relevant in local
socioeconomic studies, the impact of otherentities of the Coca-Cola System is included
SSD
Sparkling soft drinks.
TCCC
The Coca-Cola Company and, as the context may
require, its subsidiaries.
TCFD
Task Force on Climate-related Financial
Disclosures.
UNESDA
Union of European Soft Drinks Associations.
Unit case (u.c.)Approximately 5.678 litres or 24 servings, a typicalvolume measurement unit. For Bambi volume, one
unit case corresponds to 1 kilogram.
UN Global Compact (UNGC)
The world’s largest corporate citizenship initiative
which provides a framework for businesses toalign strategies with its 10 principles promoting
labour rights, human rights, environmental
protection and anti-corruption.
VolumeAmount of physical product produced and sold,measured in unit cases.
Value share
Percentage of total consumer spend withina defined category or industry.

Waste ratio
The KPI used by Coca‑Cola HBC to measurewaste generation in its bottling plants, expressedin grammes of waste generated per litre of
produced beverage (g/lpb).
Waste recycling
The KPI used by Coca‑Cola HBC to measure thepercentage of production waste at bottling plantsthat is recycled or recovered.
Water footprint
A measure of the impact of water use, in
operations or beyond, as defined by the Water
Footprint Network methodology.
Water use ratio
The KPI used by Coca‑Cola HBC to measurewater use in its bottling plants, expressed in litresof water used per litre of produced beverage (l/lpb).
Working capital
Operating current assets minus operating
current liabilities excluding financing andinvestment activities.
#YouthEmpowered (#YE)
Flagship programme from our Mission 2025
sustainability commitments, which aims to
support young people and increase theiremployability by providing modular educationof soft and/or business skills. It is delivered via
classroom sessions, virtual training, self e-learning
modules, mentoring sessions and other channels
handled locally by our markets.

Coca-Cola HBC Integrated Annual Report 2022

259

260

Strategic
ReportCorporate
Governance

Financial
Statements

Swiss Statutory
Reporting

Supplementary
Information

Special note regarding forward-looking statements
This document contains forward-looking statements that involve risks and uncertainties.
These statements may generally, but not always, be identified by the use of words such as ‘believe’,‘outlook’, ‘guidance’, ‘intend’, ‘expect’, ‘anticipate’, ‘plan’, ‘target’, ‘seek’, ‘estimates’, ’potential‘ and similar
expressions to identify forward-looking statements. All statements other than statements of historicalfact, including, among others, statements regarding the future financial position and results; Coca-Cola
HBC’s outlook for 2023 and future years; business strategy and the effects of the global economic
slowdown; the impact of the sovereign debt crisis, currency volatility, Coca-Cola HBC’s recent acquisitions,and restructuring initiatives on Coca-Cola HBC’s business and financial condition; Coca-Cola HBC’s
future dealings with The Coca-Cola Company; budgets; projected levels of consumption and production;
projected raw material and other costs; estimates of capital expenditure; free cash flow; and effective
tax rates and plans and objectives of management for future operations, are forward-looking statements.
You should not place undue reliance on such forward-looking statements. By their nature, forwardlooking statements involve risk and uncertainty because they reflect Coca-Cola HBC’s current
expectations and assumptions about future events and circumstances that may not prove accurate.
Forward-looking statements speak only as of the date they are made. Coca-Cola HBC’s actual results
and events could differ materially from those anticipated in the forward-looking statements for manyreasons, including the risks described in the Risk and materiality section. Although Coca-Cola HBC
believes that, as of the date of this document, the expectations reflected in the forward-looking
statements are reasonable, Coca-Cola HBC cannot assure that Coca-Cola HBC’s future results, levelof activity, performance or achievements will meet these expectations. Moreover, neither Coca-Cola
HBC, nor its Directors, employees, advisers nor any other person assumes responsibility for the accuracy
and completeness of any forward-looking statements. After the date of this Integrated Annual Report,
unless Coca-Cola HBC is required by law or the rules of the UK Financial Conduct Authority to updatethese forward-looking statements, Coca-Cola HBC makes no commitment to update any of theseforward- looking statements to conform them either to actual results or to changes in Coca-Cola
HBC’s expectations.

About our report
The 2022 Integrated Annual Report (the ‘Annual Report’) consolidates Coca-Cola HBC AG’s (also referred
to as ‘Coca-Cola HBC’ or the ‘Company’ or the ‘Group’) UK and Swiss disclosure requirements, while
meeting the disclosure requirements for its secondary listing on the Athens Exchange. In addition, theAnnual Report aims to deliver against the expectations of the Company’s stakeholders and sustainability
reporting standards, providing a transparent overview of the Group’s performance and progressin sustainable development for 2022.
Our strategy is designed to deliver, sustainable and profitable growth. This strategy is grounded in
our purpose to open up moments that refresh us all. Our purpose is directly linked to our strategy andthe five growth pillars that guide us as we pursue our objectives and targets. Those growth pillars are:
1. Leverage our unique 24/7 portfolio; 2. Win in the marketplace; 3. Fuel growth through competitivenessand investments; 4. Cultivate the potential of our people; 5 Earn our license to operate. The initiatives
we implemented within each of these pillars forms the basis of the narrative of the Integrated Annual
Report, which is structured around these five pillars.

Coca-Cola HBC Integrated Annual Report 2022

The Annual Report is for the year ended 31 December 2022, and its focus is on the primary corebusiness of non-alcoholic ready-to-drink beverages across the 29 countries in which we operate.
Our website and any other website referred to in the Annual Report are not incorporated by reference
and do not form part of the Annual Report.
The consolidated financial statements of the Group, included on pages 164-167, have been preparedin accordance with International Financial Reporting Standards (IFRS) as issued by the International
Accounting Standards Board (IASB). Coca-Cola HBC AG’s statutory financial statements, included on
pages 230-232, have been prepared in accordance with the Swiss Code of Obligations. Unless otherwise
indicated or required by context, all financial information contained in this document has been preparedin accordance with IFRS. For Swiss law purposes, the annual management report consists of the sections
entitled ‘Strategic Report’, ‘Corporate Governance’ (without the sub-section ‘Director’s Remuneration
Report’), ‘Supplementary Information’ and ‘Glossary’.
The Group uses certain Alternative performance measures (APMs) which provide additional insights
and understanding to the Group’s underlying operating and financial performance, financial conditionand cash flows. A full list of these APMs, their definition and reconciliation to the respective IFRS
measures can be found on pages 245-249.
This report has been prepared in accordance with the GRI Standards (2022). In addition, the sustainability
aspects of this Annual Report comply with the AA1000AS Assurance Standard, and the requirements
for communication on progress against the 10 Principles of the United Nations Global Compact (UNGC).
In addition, the report is aligned with the principles and elements of the International Integrated Reporting
Council’s (IIRC) framework. Greenhouse gas emissions are calculated using the GHG Protocol Corporate
Accounting and Reporting Standard methodology. Furthermore, Coca-Cola HBC supports the Task
Force on Climate-related Financial Disclosures (TCFD) and reports to the Sustainability AccountingStandards Board (SASB) framework. The sustainability aspects of the Integrated Annual Report havebeen verified by an independent professional assurance provider as dictated by the Company’s Executive
Leadership Team (ELT), and you can find the relevant assurance statement on pages 250-252. As withthe rest of the information provided, the sustainability aspects of this Annual Report are for the full year
ended 31 December 2022 and the related information presented is based on an annual reporting cycle.
Scope of the report 2022: environmental and social data includes North Macedonia joint venture,
Ukraine and Russia, unless otherwise stated. Snacks manufacturing operations are not included in theenvironmental and social reporting, unless otherwise stated (due to their very small impact, less than
the internal materiality threshold). Relevant impact areas from coffee and premium spirits categories
are included in the environmental and social data. As the recently acquired Egyptian operations are still
under transition, only a very few of their environmental and social data are part of our sustainability data,and it is clearly stated.
We remain committed to strong corporate governance and leadership as well as transparency in our
disclosures. We will continue to review our reporting approach and routines, to ensure they meet bestpractice reporting standards and the expectations of our stakeholders, and provide visibility on how
we create sustainable value for the communities we serve.

Visit us
www.coca-colahellenic.com

Write to us

The Group site features all the latest news
and stories from around our business andcommunities, as well as an interactive
online version of this report.

We have dedicated email addresses which
you can use to communicate with us:
investor.relations@cchellenic.com
sustainability@cchellenic.com

Coca‑Cola HBC AG
Turmstrasse 26, CH-6312 Steinhausen, Switzerlandwww.coca-colahellenic.com
investor.relations@cchellenic.com
sustainability@cchellenic.com

The paper used in this report is FSC® certified. The printer is ISO
14001 accredited. Under the framework of ISO 14001 a structured
approach is taken by the company to measure, improve and audit
their environmental status on an ongoing basis. FSC® ensures there
is an audited chain of custody from the tree in the well-managed
forest through to the finished document in the printing factory.
Designed and produced by Black Sun Plc