1. China – The Commercial Opportunity
of the 21st Century
Doug Jackson
President, China Business Unit
2. China Is Once Again Rising To Global
Prominence
The Future
China is expected to overtake
The Past
Japan as the second
GDP has been
largest global
the largest on economy in 2010
the planet for – Goldman Sachs
9 of last10 Astonishing Facts
• Largest internet user base of 350
• 710 MM cell phone users
MM
centuries
• 5.5 MM university graduates in 2008
• 300 cities with population > 1 MM
Source: quote from NBC during Olympics broadcast
3. China’s Socioeconomic Trends Offer
Tremendous Opportunity For Beverage Growth
More Consumers
Stronger Economy Further Urbanization With More Money
China GDP Per Capita China Urban Growth China Middle Class Growth
+$3,800 +250 MM +435 MM
70%
30%
USD $ Population Population
2008 2020 2008 2020 2008 2020
Leading To Enormous NARTD* Opportunity
10 Bn
unit cases 3X 30 Bn
unit cases
*Excluding bulk water & white milk
Note: Constant 2008 price and currency neutral
2008 - 2020
4. We Are Just Getting Started With Enormous
Opportunities That Lie Ahead
• In China, NARTD accounts for only • Coca-Cola captures 14% of NARTD, and this
24% of All Commercial Beverages* represents only 4% of All Commercial Beverages
China Personal Expenditure Rising
Bubble Size: Population Mexico
620
520
China potential:
420 11 Bn unit cases Chile
KO Per Capita
China potential:
320
4.7 Bn unit cases
South Africa
Argentina
220
Brazil
Philippines
120
Worldwide
Per Capita = 85 Thailand
20 China
-2,000 2,000 6,000 10,000
-80
PPP Personal Expenditure Per Capita ($US)
*All commercial beverages = NARTD, white milk and bulk water, NA NRTD, and total alcohol
5. We Are Building A Large Profitable Business
KO Total Volume
Billion 2002 - 2008 CAGR +19%
Unit Cases NARTD Leader
1.5
~29% 3rd Largest KO Market
1.2 Still CAGR +35%
0.9 New Products –
0.6 ~1/4 Volume Growth
~71%
Sparkling CAGR +15%
0.3 KO Global #1
0.0
2002 2003 2004 2005 2006 2007 2008
KO Global #2
25 Consecutive Quarters
Of Double-Digit Growth
6. We Are Winning…
2008 Volume Growth
19% 15% 30%
KO Total Sparkling Still
2008 Volume Share
14.5% 52.8% 4.9%
+0.7 +0.9 +0.7
Pts Pts Pts
NARTD* Sparkling Still*
…With Innovation, Investment, Relentless Execution
And Strong Management Team
*Excluding White Milk and Bulk Water
7. Established Clear Leadership Advantage
Against Our Nearest Global Competitor…
NARTD Volume Sparkling
2X 1.6X
KO Major Global KO Major Global
Competitor Competitor
Stills* Juice & Juice Drinks
8X 6X
KO Major Global KO Major Global
Competitor Competitor
…Which Allows Us To Continue To Scale Up And Accelerate Profitability
*Stills includes juice, tea, water, coffee and sports drinks
8. A Profitable System Investing Ahead Of Demand…
…To Create Immense Value For Our Company
8
9. 2020 Strategic Imperatives
Expand Portfolio To Capture Value
Invest In Our Distribution System To Win At The Point Of Sale
Invest Aggressively In Cold Drink Equipment
Drive One Seamless System
10. 1. Expanding Portfolio To Capture Value
Innovation & Portfolio Expansion
Sparkling
Juice & Juice Drinks Value-Added Dairy
Minute Maid
Pulpy
New
Categories
Tea Juice Dairy
Water Sparkling
11. 1. Minute Maid Pulpy Super Milky
A Winning Proposition
A FUSION OF SENSATIONAL GOODNESS
New Zealand Minute Maid Coconut
Milk Juice PULPY
(Equivalent protein of
2 glasses of milk)
NUTRITION NEVER TASTED SO GOOD
12. 1. Leading To SIX Billion Dollar Brands
Today 2020
* Defined using Retail Value
13. 2. We Will Continue To Invest In Expanding
Our Distribution Footprint…
Execution
Enhancement
Channel
…to WIN at the
Picture of
Success
Point-of-Sale
Vertical Growth
4.7 MM
Sales Distribution Managed
Outlets
Force Partners Outlets
Rural
Penetration
Horizontal Growth Western
Expansion
14. 3. And Invest In Cold Drink Equipment
To Drive Product Availability
6X
Modern Trade General Trade
(2/3 door) (1/2 door)
CVS Convenient Store On Premise
Capturing Strategic “Real Estate” In Retail Outlets
15. 4. Our Partners Are Committed To Our 2020 Vision
And Operating Seamlessly To Drive Efficiency
Global Innovation
Center
Still Customer
Beverages Management
National
Procurement Coca-Cola
Consortium University
COFCO Bottling Investments Group
One Seamless System
16. 4. Continue To Invest In Infrastructure
Expansion
Heilongjiang
Jilin
Xinjiang Liaoning
Inner Mongolia Beijing
Tianjin
Hebei
Ningxia
2X+
Shanxi
Qinghai Shandong
Gansu
Shaanxi Henan Jiangsu
Tibet
Anhui Shanghai
Sichuan Hubei
Chongqing
Zhejiang
Hunan Jiangxi
Guizhou
Fujian Bottling
Yunnan Guangxi Guangdong Plants
Bottling plant Zhuhai
China mainland only Hainan
17. 2020 Strategic Imperatives
Expand Portfolio To Capture Value
Invest In Our Distribution System To Win At The Point Of Sale
Invest Aggressively In Cold Drink Equipment
Drive One Seamless System
