SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported):
July 23, 2003
COCA-COLA BOTTLING CO. CONSOLIDATED
(Exact name of registrant as specified in its charter)
| Delaware |
0-9286 |
56-0950585 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
4100 Coca-Cola Plaza, Charlotte, North Carolina 28211
(Address of principal executive offices) (Zip Code)
(704) 557-4400
(Registrant’s telephone number, including area code)
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
| (a) | Financial Statements. Not applicable. |
| (b) | Pro Forma Financial Information. Not applicable. |
| (c) | Exhibits. The following exhibit is filed herewith: |
| 99.1 | Press release issued on July 23, 2003. |
Item 9. Regulation FD Disclosure.
The following information is being furnished pursuant to Item 12 – Results of Operations and Financial Condition.
The Registrant issued a press release on July 23, 2003 covering the results of the second quarter of 2003.
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized:
| COCA-COLA BOTTLING CO. CONSOLIDATED (REGISTRANT) | ||||||||
| Date: July 25, 2003 | BY: | /s/ David V. Singer | ||||||
| David V. Singer Principal Financial Officer of the Registrant and Executive Vice President and Chief Financial Officer | ||||||||
SECURITIES AND EXCHANGE COMMISSION
Washington, DC
EXHIBITS
CURRENT REPORT
ON
FORM 8-K
| Date of Event Reported: | Commission File No: | |
| July 23, 2003 | 0-9286 |
COCA-COLA BOTTLING CO. CONSOLIDATED
EXHIBIT INDEX
| Exhibit No. |
Exhibit Description | |
| 99.1 | Press release issued on July 23, 2003. | |
Exhibit 99.1
Coca-Cola Bottling Co. Consolidated, 4100 Coca-Cola Plaza, Charlotte, NC 28211
News Release
 |
Media Contact: | Lauren C. Steele VP Corporate Affairs 704-557-4551 | ||||
| Investor Contact: | David V. Singer Executive VP & CFO 704-557-4604
| |||||
| FOR IMMEDIATE RELEASE | Symbol: COKE | |
| July 23, 2003 | Quoted: The Nasdaq Stock Market (National Market) |
Coca-Cola Bottling Co. Consolidated Reports Second Quarter 2003 Results
CHARLOTTE, NC — Coca-Cola Bottling Co. Consolidated today announced earnings of $11.9 million or $1.32 per share for the second quarter of 2003. This compares to net income of $10.8 million or $1.23 per share for the second quarter of 2002. For the first six months of 2003, net income was $13.3 million or $1.47 per share as compared to $14.2 million or $1.61 per share for the first six months of 2002.
Net sales declined 3.4% in the second quarter of 2003 as compared to the second quarter of 2002. This decline reflects lower bottle/can volume, which was down 4.3% in the second quarter and 1.9% in the first half. The difference between the growth rate in net sales and the growth rate in volume primarily reflects higher average revenue per case. The decline in net sales reflects unseasonably cool and abnormally wet weather across the Company’s territories as well as less aggressive retail pricing by several of the Company’s large customers. As a result of soft net sales performance, income from operations was down $6.3 million or 19% for the second quarter. The reduction in income from operations was partially offset by declines in interest expense and minority interest. In addition, the Company’s second quarter income tax provision was favorably impacted by a $3.1 million benefit resulting from the completion of a tax audit.
J. Frank Harrison, III, Chairman and CEO, said that he was disappointed with operating income through June, but was pleased with the Company’s expense control and continued success in debt reduction. Mr. Harrison said, “Due to the fixed nature of many of the Company’s costs, weaker than anticipated net sales translate into lower operating income.” Mr. Harrison said, “Despite higher wage rates and a significant increase in the cost of pension and health care benefits, the Company’s operating expenses were up less than 3% for the first half of 2003. Furthermore, the Company reduced overall debt and capital lease liabilities by more than $11 million over the past 12 months, despite the $53.5 million acquisition of an additional 22.7% interest in Piedmont Coca-Cola Bottling Partnership. The reductions in debt and capital lease liabilities along with the acquisition of another portion of Piedmont provided for lower interest expense and minority interest, which helped offset some of the Company’s shortfall in operating income in the first half of 2003.”
William B. Elmore, President and COO, attributes some of the Company’s net sales performance through the first six months to industry wide softness in the Company’s markets. Mr. Elmore said, “Although our volume has been weak during the first half of 2003, our market share has remained stable. The unseasonably cool and wet weather we have experienced so far this year appears to have had a dampening effect on overall beverage sales in our territories, especially in the higher margin immediate consumption market.” Mr. Elmore went on to say, “The Company is focused on improving net sales performance in the second half of the year through a combination of higher pricing and innovations in packaging, which include a 390 ml PET bottle for the immediate consumption market and 12 ounce PET bottles in Fridge Packs™ for the take-home market.”
Forward-looking statements.
Included in this news release are several forward-looking management comments and other statements that reflect management’s current outlook for future periods. These expectations are based on currently available competitive, financial and economic data along with the Company’s operating plans, and are subject to future events and uncertainties. These statements may include, among others, statements relating to our expectations concerning improving net sales performance in the second half of 2003 and our introduction of a 390 ml PET bottle for the immediate consumption market and 12 ounce PET bottles in Fridge Packs™ for the take-home market. Among the events or uncertainties which could adversely affect future periods are lower-than-expected net pricing resulting from increased marketplace competition, an inability to meet requirements under bottling contracts, an inability to meet performance requirements for expected levels of marketing support payments from The Coca-Cola Company, material changes from expectations in the cost of raw materials, the inability of our aluminum can or PET bottle suppliers to meet our demand, higher than expected fuel prices, adverse weather conditions and unfavorable interest rate fluctuations. The forward-looking statements in this news release should be read in conjunction with the detailed cautionary statements found on pages 27 and 28 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 29, 2002.
-Enjoy Coca-Cola-
Coca-Cola Bottling Co. Consolidated
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
In Thousands (Except Per Share Data)
| Second Quarter |
First Half |
|||||||||||||||
| 2003 |
2002 |
2003 |
2002 |
|||||||||||||
| Net sales |
$ | 318,165 | $ | 329,512 | $ | 593,365 | $ | 601,130 | ||||||||
| Cost of sales |
164,505 | 170,068 | 304,811 | 307,212 | ||||||||||||
| Gross margin |
153,660 | 159,444 | 288,554 | 293,918 | ||||||||||||
| Selling, general and administrative expenses |
106,789 | 106,757 | 208,914 | 203,169 | ||||||||||||
| Depreciation expense |
19,282 | 18,857 | 38,297 | 36,842 | ||||||||||||
| Amortization of intangibles |
767 | 686 | 1,465 | 1,373 | ||||||||||||
| Income from operations |
26,822 | 33,144 | 39,878 | 52,534 | ||||||||||||
| Interest expense |
10,916 | 11,877 | 21,287 | 24,017 | ||||||||||||
| Other income (expense), net |
(246 | ) | (650 | ) | (445 | ) | (1,549 | ) | ||||||||
| Minority interest |
1,142 | 2,764 | 1,258 | 3,523 | ||||||||||||
| Income before income taxes |
14,518 | 17,853 | 16,888 | 23,445 | ||||||||||||
| Income taxes |
2,618 | 7,070 | 3,581 | 9,284 | ||||||||||||
| Net income |
$ | 11,900 | $ | 10,783 | $ | 13,307 | $ | 14,161 | ||||||||
| Basic net income per share |
$ | 1.32 | $ | 1.23 | $ | 1.47 | $ | 1.61 | ||||||||
| Diluted net income per share |
$ | 1.32 | $ | 1.21 | $ | 1.47 | $ | 1.60 | ||||||||
| Weighted average number of common shares outstanding |
9,043 | 8,784 | 9,043 | 8,779 | ||||||||||||
| Weighted average number of common shares outstanding—assuming dilution |
9,043 | 8,880 | 9,043 | 8,869 | ||||||||||||
Coca-Cola Bottling Co. Consolidated
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
In Thousands
| June 29, 2003 |
Dec. 29, 2002 |
June 30, 2002 | |||||||
| ASSETS |
|||||||||
| Current Assets: |
|||||||||
| Cash |
$ | 7,272 | $ | 18,193 | $ | 8,667 | |||
| Accounts receivable, trade, net |
84,858 | 79,548 | 93,548 | ||||||
| Accounts receivable from The Coca-Cola Company |
12,586 | 12,992 | 15,729 | ||||||
| Accounts receivable, other |
2,770 | 17,001 | 5,610 | ||||||
| Inventories |
40,114 | 38,648 | 42,020 | ||||||
| Prepaid expenses and other current assets |
8,565 | 4,588 | 7,404 | ||||||
| Total current assets |
156,165 | 170,970 | 172,978 | ||||||
| Property, plant and equipment, net |
461,707 | 466,840 | 472,790 | ||||||
| Leased property under capital leases, net |
44,342 | 44,623 | 48,532 | ||||||
| Other assets |
60,912 | 58,167 | 73,376 | ||||||
| Franchise rights and goodwill, net |
622,426 | 606,128 | 607,007 | ||||||
| Other identifiable intangible assets, net |
9,631 | 6,797 | 7,340 | ||||||
| Total |
$ | 1,355,183 | $ | 1,353,525 | $ | 1,382,023 | |||
Coca-Cola Bottling Co. Consolidated
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
In Thousands
| June 29, 2003 |
Dec. 29, 2002 |
June 30, 2002 |
||||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||||||
| Current Liabilities: |
||||||||||||
| Portion of long-term debt payable within one year |
$ | 39 | $ | 31 | $ | 215,631 | ||||||
| Current portion of obligations under capital leases |
4,091 | 3,960 | 4,777 | |||||||||
| Accounts payable, trade |
38,083 | 38,303 | 42,257 | |||||||||
| Accounts payable to The Coca-Cola Company |
8,229 | 9,823 | 6,646 | |||||||||
| Other accrued liabilities |
76,748 | 72,647 | 82,261 | |||||||||
| Accrued compensation |
12,904 | 20,462 | 11,570 | |||||||||
| Accrued interest payable |
11,962 | 10,649 | 11,140 | |||||||||
| Total current liabilities |
152,056 | 155,875 | 374,282 | |||||||||
| Deferred income taxes |
158,874 | 155,964 | 164,485 | |||||||||
| Pension and retiree benefit obligations |
39,286 | 37,227 | 30,893 | |||||||||
| Other liabilities |
60,248 | 58,261 | 61,133 | |||||||||
| Obligations under capital leases |
42,182 | 42,066 | 42,123 | |||||||||
| Long-term debt |
825,078 | 807,725 | 620,125 | |||||||||
| Total liabilities |
1,277,724 | 1,257,118 | 1,293,041 | |||||||||
| Minority interest |
32,832 | 63,540 | 59,356 | |||||||||
| Stockholders’ Equity: |
||||||||||||
| Common Stock |
9,704 | 9,704 | 9,498 | |||||||||
| Class B Common Stock |
3,029 | 3,009 | 3,009 | |||||||||
| Capital in excess of par value |
97,220 | 95,986 | 88,843 | |||||||||
| Retained earnings |
14,828 | 6,043 | 1,854 | |||||||||
| Accumulated other comprehensive loss |
(18,900 | ) | (20,621 | ) | (12,324 | ) | ||||||
| 105,881 | 94,121 | 90,880 | ||||||||||
| Less-Treasury stock, at cost: |
||||||||||||
| Common |
60,845 | 60,845 | 60,845 | |||||||||
| Class B Common |
409 | 409 | 409 | |||||||||
| Total stockholders’ equity |
44,627 | 32,867 | 29,626 | |||||||||
| Total |
$ | 1,355,183 | $ | 1,353,525 | $ | 1,382,023 | ||||||