Delivering Sustainable Growth Brazil Business Unit

Delivering Sustainable Growth

Brazil Business Unit

March 22, 2011

2

Key Messages

• We are delivering solid results leveraging on a rich heritage and a strong and balanced portfolio

• Brazilian NARTD market provides multiple opportunities for KO sustained growth over the next decade

• We have a disciplined strategy to continue winning in the future

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1.9 Bn Unit Cases

KO’s 4th Largest Market (7% of Global Volume)

KO Per Capita: 229 8oz. Servings

3.4 Times Larger than Nearest Competitor

Brazil: A Key Market For KO

• Large and developing country

– 8.5 million km²

– ~190 million inhabitants

– ~ US$ 2.0 trillion(1) in GDP

• Solid macroeconomic fundamentals

– GDP growth in 2010: ~7.5%(2) and expected 2011: ~4.4%(2)

– Low inflation expectations: ~5.9% (2)

– Real income gains (around 4% (3) higher than ‘09)

– Better income distribution (GINI index(4) decreasing since ‘98)

– Continued credit expansion

• Stable institutions

– Dilma Rousseff election is a bet for continuity with no major

changes in social/economic policies

– Senate and Congress favoring Dilma’s mandate

• Hosting mega global events – 2014 FIFA World Cup and 2016

Olympic Games

(1)Source: Tendências (2) Source: Boletim Focus (Brazil’s Central Bank’s weekly research) (3) Source: IBGE data Nov’10 (4) GINI index measures the income difference

Coca-Cola Brazil at FY 2010:

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We Hold The Best Position To Compete

Leading positions across NARTD beverage market: 54%(1) NARTD volume share (2010)

POS Presence

~1 MM Category Key Brands Position

Sparkling Soft Drinks

#1

RTD Juices / Juice Drinks

#1

Bottled Water #1

Tea / Mate #1

Flavored Water #2

Sports Drinks #2

Energy Drinks #2

~540K Installed

Coolers

44 Plants

System Investments:

• 2004-2009: US$ 3.6Bn • 2010-2014: US$ 6Bn

+67%

(1)Source: Canadean

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We’ve Been Winning In The Brazilian Market

KO Volume Growth (vs. PY)

2009

+16%

2007 2006

+9%

2005

+11% +4%

Coke TM

+8%

+33%

Juices / Juice Drinks(2)

KO Volume Growth by Category

5-Year CAGR (2005-2010)

(1) 4,17% Estimate (2) Including acquisitions (3)Source: Canadean

2008

+7%

+7%

SSDs Water(2)

+42% +1.7 p.p.(3) NARTD

volume share growth in

2010

KO growing 2.3x faster

than Brazil’s GDP(1)

(05-10 CAGR)

Still Bevs.(2)

+52%

2010

+11%

6 Classified – Highly Restricted

Very Positive 2010 Results Enhanced By Tail Wind

2005 2006 2007 2008 2009 2010

-0.2%

+3.2% +4.0% +5.7%

+7.5% +5.1%

J07

A0

7

J07

O0

7

J08

A0

8

J08

O0

8

J09

A0

9

J09

O0

9

J10

A1

0

J10

Favorable Scenario

IPCA Food & Beverages (%PY) IPCA General (%PY)

Favorable Weather

Temperatures

above average

Higher Consumption Potential • KO price increase = inflation • Salary mass growth > inflation

GDP 2010 Growth Record

IPCA Food & Beverages

Inflation Decreasing

+11% vs. PY driving NARTD volume share gain of 1.7 p.p. (1)

(1)Source: Canadean

KO NARTD Volume

2010 “Tail Wind”

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Strengthened system partnership

Winning In The Brazilian Market

CVD

WATER JVs

SSDs

Restructured strategies leveraging on

segmented approach and Revenue

Growth Management (RGM)

Built mega brands

Executed successful acquisitions

Strengthened our execution capabilities

Established customized business models

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We Have A Disciplined 5 Step Strategy To Continue

Winning In The Future

Grow Sparkling Leadership

Strengthen System

Capability

Grow Sparkling

Leadership

Rapidly Grow Still Beverages

Leverage Global Events

Innovation

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Affordability: Opportunity To Be Captured By

Accelerating Returnables

EMERGING MIDDLE CLASS COMPETITORS

SHOPPER CONSUMER

LOVE:

DAILY:

61%

24%

64%

19%

Low Socio-Economic Level (SEL) teens

have lower levels of consumption

Source: Internal Data (Coca-Cola) / Dec’10

Increase % of income

committed to basic goods

Access to new kinds of

goods

Lower money

availability

$

Greater coordination of B-brands through Afebras

Increasing distribution and household penetration

60% 56% 50%

26% 29% 34%

14% 15% 16%

2004 2007 2011

A/B (High SEL)

C (Mid SEL)

D/E (Low SEL)

Households per Socio-Economic Level (SEL - %)

Entrance of Ajegroup and Industria San Miguel

Source: IBGE ; (1) Estimated

Key for transactions

Grow Sparkling

Leadership

High SELs (AB)

Mid-Low SELs (CDE)

(1)

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BPPO

Shopper Experience

Shopper Promotions

Strategy

Phase 1 Know

Through Affordability

Habit Building Through Recruitment

CC RGB (1)

1.0L or 1.25L

Repurchase Promo

Meals

Phase 2 Accept

Increase Frequency

CC RGB CC RefPet

Through Meals & Recognition

Loyalty Promos linked w/ Meals

CC RGB &

Phase 3 Like

Reinforce & Sustain Frequency

RefPet Flavors

RGB/RP

RGB

Phase 4 Love

Establish “Returnable Attitude”

RefPet Flavors

1.0/1.25L 1.5/2.0L

A Phasing Approach For Returnables Development

1.0/1.25L 1.5/2.0L RGB/RP 1.0/ 1.25L

1.5/ 2.0L

Grow Sparkling

Leadership

(1) RGB = Returnable Glass Bottle

20% – 40% 40% – 60% 60% – 80% HH Penetration 0% – 20%

+ Occasions

Tie with sustainability platform Live Positively

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346 420 540

2008 2009 2010

Targeting Profitable Occasions Through

Single-Serves

Grow Sparkling

Leadership

R$ 0.75 1.00 1.25 1.50 3.00 2.00 2.50

Tailo

red

in

vita

tio

n t

o

dri

nk

Co

ld d

rin

k ex

pe

rie

nce

B

PP

O a

imin

g at

m

agic

pri

ce

Changing habits in high traffic areas

Tailored shopper experience for emerging channel

Adapted to new occasions & categories

Owning the meals occasion

High market investments (cumulative # coolers)

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Growing In Still Beverages

Key priorities 2011 - 2012

• Consolidate and expand Del Valle TM

• Build a national water brand

• Consolidate sport drinks portfolio

• Evolve to a day/night energy solution

• Fully integrate Leão into KO system

• Strengthen still beverages joint

venture growth model

Energy Sports

Tea / Mate Water

Rapidly Grow Still Beverages

Juices

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KO Juice Transition To Del Valle Trademark And

Global Visual Identity System

• New global visual identity system in 2011

• Del Valle & Minute Maid Mais as stand-alone brands

• Implementation of Trademark to leverage

conversion from NRTD juices

• Creation of juice solution for emerging

middle class through launch of Valle Frut

Rapidly Grow Still Beverages

Phase 1 Phase 2 Phase 3

Juices volume share gain in 2010 +6.8 p.p. vs. PY(1) (1)Source: Canadean Note: Juices includes nectars and fruit stills.

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Strengthen System Execution Capabilities

PEOPLE DEVELOPMENT

SYSTEMS, PROCESSES & ROUTINES

Execution Platforms

Strengthen System

Capability

TRACKING (RED)

OPPORTUNITY IDENTIFICATION

SEGMENTATION & LOS DESIGN

TRADE ENGAGEMENT

EXECUTION (RTM)

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Products

Equipment

Packaging

Cooler

Aquarius Fresh

PET 250ml

Consumer Engagement

Accelerate Innovation

Strengthen And Accelerate Innovation Pipeline

• Leveraging global pipeline

• Streamlining internal processes

• Developing new capabilities

Approach w/ Moms

Digital

Powerade

Rack

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Outstanding Event Execution Build Permanent Legacies

Use FIFA WC 2014 to sustainably step-change consumer connection, corporate reputation and business results for KO Brazil

Our Vision For FIFA World Cup 2014 Leverage Global Events

Active Healthy Living

Recycling

On-the-go

Teen recruitment (13-19 years old)

Socio-environmental leadership

Strong presence in high visibility areas

Broad client partnerships

Massive use of FIFA properties

Everyday Football presence

Seamless on-site execution Proactive stakeholder engagement Iconic Football IMC

“Coca-Cola recognized as recycling

leader in Brazil, promoting a

sustainable and massive virtuous

cycle”

“Recruit next teen generation,

stimulating brand love and daily

consumption “habit”

“Triple on-the-go per capita

consumption through a massive and

highly attractive invitation to drink”

“Coca-Cola recognized as a

company that promotes active,

healthy living from high

performance exercise to fun daily

activities”

football IMC

presence

Everyday football

Communities “Coca-Cola fully integrated into the

communities enabling a better

future for low income families”