Coca-Cola Enterprises Inc.

Company Profile
Publication Date: 2 Dec 2010

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Coca-Cola Enterprises Inc.

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TABLE OF CONTENTS

TABLE OF CONTENTS
Company Overview..............................................................................................4 Key Facts...............................................................................................................4 Business Description...........................................................................................5 History...................................................................................................................6 Key Employees.....................................................................................................8 Key Employee Biographies..................................................................................9 Major Products and Services............................................................................13 Revenue Analysis...............................................................................................14 SWOT Analysis...................................................................................................15 Top Competitors.................................................................................................20 Company View.....................................................................................................21 Locations and Subsidiaries...............................................................................24

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Company Overview

COMPANY OVERVIEW
Coca-Cola Enterprises (CCE or the company) produces, markets and distributes non-alcoholic beverages. The company primarily operates in Great Britain, France, The Netherlands, Belgium, Luxemburg, Norway and Sweden. It is headquartered in Atlanta, Georgia and employs about 70,000 people. The company recorded revenues of $21,645 million during the financial year ended December 2009 (FY2009), a decrease of 0.7% as compared to 2008. The decrease in the companys revenue was mainly caused due to lower sales of the higher-margin beverages and significantly low sales of its brand, Dasani. The operating profit of the company was $1,527 million in FY2009, as compared to an operating loss of $6,299 million in 2008. The net profit was $731 million in FY2009, as compared to a net loss of $4,394 million in 2008.

KEY FACTS
Head Office Coca-Cola Enterprises Inc. 2500 Windy Ridge Parkway Atlanta Georgia 30339 USA 1 770 989 3000 1 770 989 3788 http://www.cokecce.com/

Phone Fax Web Address

Revenue / turnover 21,645.0 (USD Mn) Financial Year End Employees New York Stock Exchange Ticker December 70,000 CCE

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Business Description

BUSINESS DESCRIPTION
Coca-Cola Enterprises (CCE or the company) is one of the leading Coca-Cola bottlers. It manufactures, markets, sells, and distributes non-alcoholic beverages. Its largest shareowner is The Coca-Cola Company (Coca-Cola). In FY2009, CCE served a market of approximately 421 million consumers throughout the US, Canada, the US Virgin Islands, Belgium, France, Great Britain, Luxembourg, Monaco, and the Netherlands. The company operates through its 18 manufacturing plants, 33 warehouses and 83 production lines in Europe. *The company reports it business under one segment within two geographies: North America and Europe. The company primarily produces, bottles, markets and distributes Coca-Cola trademark beverages such as Coke, Fanta and Sprite. It also distributes Dr Pepper and other beverage brands. Additionally, CCE's portfolio consists of a range of regular and zero calorie beverage categories including energy drinks, still and sparkling waters, juices, sports drinks, milk-based products, fruit drinks, coffee-based beverages and teas. CCE conducts its business primarily under agreements with Coca-Cola. These agreements give the company the exclusive right to market, produce, and distribute beverage products of Coca-Cola in authorized containers in specified territories. The company manufactures most of its finished products from syrups and concentrates that it buys from Coca-Cola and other licensors. The remainder of the products that the company sells is purchased in finished form. *In October 2010, the company sold its North American bottling operations to Coca-Cola. Simultaneously, it also acquired the Norway and Sweden bottling operations from Coca-Cola.

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History

HISTORY
Coca-Cola Enterprises (CCE or the company) was formed in 1986 when The Coca-Cola Company (Coca-Cola) bought its two largest bottlers, JTL Corp and BCI Holdings. In the same year, the company was listed on the New York Stock Exchange. Over the next two years, the company acquired six Coca-Cola bottling companies in the US, and eventually assumed responsibility for bottling operations in the UK, France, the Netherlands and Belgium. The company merged with Johnston Coca-Cola Bottling Group in 1991. CCE made its first international acquisition in 1993, with the purchase of Coca-Cola Beverages Nederland. In the same year, it also acquired Roddy Coca-Cola Bottling Company, (in Knoxville, Tennessee) and the Coca-Cola Bottling Company at Johnson City, Tennessee. Companys expansion continued over the next two years with the acquisitions of Wichita Coca-Cola Bottling Company, Beverages Sales Holding in Belgium, Coca-Cola Beverages and Coca-Cola Production in France, Coca-Cola Bottling Company West, and related company, Grand Forks Coca-Cola Bottling Company (Coke West). The acquisition of UK-based Coca-Cola and Schweppes Beverages was completed in 1997. Acquisitions of the Coke New York, Coke Southwest, and Canadian territories were completed in the following year. During 2000, the company merged with Schweppes Beverages. Growth continued in 2001, with the acquisition of Herb Coca-Cola, the third largest US bottler of products of The Coca-Cola Company. It also made two other bottling purchases that year: Southwest Dr Pepper Bottling Company, which operated in Missouri, and Tarpon Springs Coca-Cola Bottling Company, which operated in Florida. In 2005, the company signed a distribution agreement with Rockstar, maker of energy drink to distribute Rockstar branded products in all of its territories in the US and Canada except the Northwest and Northern California divisions. Simultaneously in the same year, CCE acquired options to purchase shares of common stock, convertible securities and warrants, entitling CCE to purchase common stock from 12 shareholders of Bravo! Foods International, a brand development and marketing company that manufactures, promotes and distributes vitamin fortified, flavored milk. During 2006, CCE completed the US distribution agreement with Hornell Brewing, maker of AriZona Iced Tea products. Beginning in 2007, CCE began distributing three flavors of a new 34 oz. package of AriZona Iced Tea to its retail customers in the US: Iced Tea with Lemon, Green Tea with Honey and Lemon, and Sweet Tea. In 2007, CCE began distribution of seven ArizZona flavors in a range of bottle and can package throughout its territories in Canada. Further in the same year, the company entered into an agreement with Coca-Cola to distribute glaceau brands smartwater, vitaminwater, and vitaminenergy. The company also launched Coca-Cola Recycling in 2007, which focuses on capturing beverage packaging materials in North America for recycling within the Coca-Cola system.

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History

CCE acquired the Cen-Tex Coca-Cola Bottling Company, a franchised Coca-Cola bottling company in Mexia, Texas in 2008. Also in the same year, the company sold $275 million of three-year floating-rate notes. The size of the deal was increased from the originally planned $250 million. Deutsche Bank Securities and JP Morgan were the joint book-running managers for the sale. Later in 2008, CCE was recognized for the second consecutive year as the recipient of the Golden Peacock Award for Corporate Social Responsibility Reporting by the World Council for Corporate Governance. Also in 2008, Hansen Natural Corporation, Coca-Cola and CCE completed agreements for distribution of the category-leading Monster Energy drinks line in six Western European countries, Canada and selected territories in the US. In January 2009, CCE announced its plan to deploy an incremental 185 hybrid electric trucks across the US and Canada in 2009, bringing their total number of hybrid electric delivery trucks to 327, the largest such fleet in North America. Also in early 2009, the company began the distribution of Monster beverages in all of its European territories under distribution agreements with Hansen. The company introduced its famous curvy contour bottle to the Florida market in July 2009. This new two liter form of Coca-Colas famous package was preferred over the straight wall two liter bottle by the consumer. In late 2009, CCE entered into agreements with Ocean Spray International for the distribution of Ocean Spray products in Great Britain and France starting January 2010. In February 2010, Coca-Cola announced to acquire CCE's North American Bottling business and in turn CCE agreed in principle to buy Coca-Colas bottling operations in Norway and Sweden, and to obtain the right to acquire the German bottler. The company completed its above mentioned transaction with Coca-Cola in October 2010.

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Key Employees

KEY EMPLOYEES
Name
John F. Brock Fernando Aguirre Jan Bennink Calvin Darden L. Phillip Humann Orrin H. Ingram Donna A. James Thomas H. Johnson Suzanne B. Labarge Veronique Morali Phoebe A. Wood Curtis R. Welling William W. Douglas Hubert Patricot Laura Brightwell Pamela O. Kimmet John R. Parker Esat Sezer Suzanne N. Forlidas Suzanne D. Patterson

Job Title
Chairman and Chief Executive Officer Director Director Director Director Director Director Director Director Director Director Director

Board
Executive Board Non Executive Board Non Executive Board Non Executive Board Non Executive Board Non Executive Board Non Executive Board Non Executive Board Non Executive Board Non Executive Board Non Executive Board Non Executive Board

Compensation
15551862 USD 198143 USD

206921 USD 210485 USD 206485 USD 227485 USD 195485 USD 203485 USD

221742 USD 3834748 USD 3539308 USD

Executive Vice President and Chief Senior Management Financial Officer Executive Vice President and President, European Group Senior Management

Senior Vice President, Public Affairs Senior Management and Communications Senior Vice President, Human Resources Senior Vice President, General Counsel and Strategic Initiatives Senior Vice President and Chief Information Officer Vice President and Assistant Secretary Senior Management Senior Management Senior Management Senior Management 3099913 USD

Vice President, Controller and Chief Senior Management Accounting Officer

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Key Employee Biographies

KEY EMPLOYEE BIOGRAPHIES

John F. Brock
Board: Executive Board Job Title: Chairman and Chief Executive Officer Since: 2008 Age: 61 Mr. Brock has been the Chairman and Chief Executive Officer at CCE since 2008. Prior to his current position, Mr. Brock served as the President at CCE from 2006 to 2008. From 2003 until 2005, he served as the Chief Executive Officer at InBev, a global brewer; and from 1999 to 2002, Mr. Brock was the Chief Operating Officer at Cadbury Schweppes, an international beverage and confectionery company.

Fernando Aguirre
Board: Non Executive Board Job Title: Director Since: 2005 Age: 52 Mr. Aguirre has been a Director at CCE since 2005. He has been the Chairman, Chief Executive Officer and President at Chiquita Brands International since 2004. From 2002 to 2004, Mr. Aguirre served as the President, Special Projects at the Procter and Gamble Company (P&G) and from 2000 to 2002, he served as the President at the Global Feminine Care business unit of P&G.

Jan Bennink
Board: Non Executive Board Job Title: Director Age: 54 Mr. Bennink currently serves as a Director at CCE.

Calvin Darden
Board: Non Executive Board Job Title: Director Since: 2004 Age: 60

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Key Employee Biographies

Mr. Darden has been a Director at CCE since 2004. He had been Senior Vice President of US Operations at United Parcel Service, from 2000 to 2005. Mr. Darden also serves as a Director at Target Corporation and Cardinal Health.

L. Phillip Humann
Board: Non Executive Board Job Title: Director Since: 1992 Age: 64 Mr. Humann has been a Director at CCE since 1992. He has also served as the Chairman of the Board at SunTrust Banks, a bank holding company, from 1998 t o2008. Mr. Humann has also served as Sun Trust Banks Chief Executive Officer from 1998 to 2006 and President from 1998 to 2004. He is also a Director at Equifax, a credit information provider, and Haverty Furniture Companies, a furniture retailer.

Orrin H. Ingram
Board: Non Executive Board Job Title: Director Since: 2008 Age: 49 Mr. Ingram has been a Director at CCE since 2008. He has been the President and Chief Executive Officer at Ingram Industries, a diversified products and services company, since 1999. Before that, Mr. Ingram held various positions at Ingram Materials Company and Ingram Barge Company, and was the Co-President at Ingram Industries from 1996 to 1999. He is a director at Ingram Micro, a global information technology distributor.

Donna A. James
Board: Non Executive Board Job Title: Director Since: 2005 Age: 52 Ms. James has been a Director at CCE since 2005. She is the President at Lardon and Associates, a consulting firm specializing in corporate governance and new business development. Ms. James had been the President of Nationwide Strategic Investments, a division of Nationwide Mutual Insurance Company from 2003 to 2006.

Thomas H. Johnson

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Key Employee Biographies

Board: Non Executive Board Job Title: Director Since: 2007 Age: 60 Mr. Johnson has been a Director at CCE since 2007. He has also been a Managing Partner at THJ Investments since 2005 and has also served as the Chief Executive Officer at Taffrail Group since 2008. Mr. Johnson has also served as the Chairman and Chief Executive Officer at Chesapeake Corporation. Previously, he served as the President and Chief Executive Officer at Riverwood International Corporation, and held a number of management and executive positions at Mead Corporation. Mr. Johnson serves on the Board of Directors at Mirant Corporation, ModusLink Global Solutions and Universal Corporation.

Suzanne B. Labarge
Board: Non Executive Board Job Title: Director Since: 2007 Age: 63 Ms. Labarge has been a Director at CCE since 2007. She served as the Vice Chairman and Chief Risk Officer at RBC Financial Group, from 1999 until her retirement in 2004. Ms. Labarge is also a member of the Supervisory Board at Deutsche Bank and from 2005 to 2007, she served as the Director at Novelis.

Curtis R. Welling
Board: Non Executive Board Job Title: Director Since: 2007 Age: 60 Mr. Welling has been a Director at CCE since 2007. He currently serves as the President and Chief Executive Officer at AmeriCares Foundation. Previously, Mr. Welling served as the Chief Executive Officer at Princeton eCom and SG Cowen Securities Corporation, and has held several executive and management positions at Bear, Stearns, and Company, Anthem Partners and CS First Boston.

William W. Douglas
Board: Senior Management Job Title: Executive Vice President and Chief Financial Officer Since: 2008 Age: 49

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Key Employee Biographies

Mr. Douglas has been the Executive Vice President and Chief Financial Officer at CEE since 2008. Prior to that, he served as the Senior Vice President and Chief Financial Officer at CEE from 2005 to 2008. Mr. Douglas has also served as the Vice President, Controller, and Principal Accounting Officer at CEE from 2004 to 2005.

Hubert Patricot
Board: Senior Management Job Title: Executive Vice President and President, European Group Since: 2008 Age: 50 Mr. Patricot has been the Executive Vice President and President, European Group at CCE since 2008. Prior to that, he served as the General Manager and Vice President at CCE Great Britain in 2008. Mr. Patricot had also served as the General Manager and Vice President at CCE France from 2003 to 2008.

John R. Parker
Board: Senior Management Job Title: Senior Vice President, General Counsel and Strategic Initiatives Since: 2008 Age: 58 Mr. Parker has been the Senior Vice President, General Counsel and Strategic Initiatives at CCE since 2008. Prior to that, he served as the Senior Vice President, Strategic Initiatives for North America from 2005 to 2008. Mr. Parker had also been the President and General Manager for the companys Southwest Business Unit from 2004 to 2005.

Suzanne D. Patterson
Board: Senior Management Job Title: Vice President, Controller and Chief Accounting Officer Since: 2009 Age: 48 Ms. Patterson has been the Vice President, Controller, and Chief Accounting Officer at CCE since 2009. From 2006 to 2009 she served as the Vice President of Internal Audit at CCE. Prior to that, Ms. Patterson served as the Vice President of Internal Audit at Sun Microsystems from 2004 to 2006.

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Major Products and Services

MAJOR PRODUCTS AND SERVICES

Coca-Cola Enterprises (CCE or the company) produces, markets and distributes non-alcoholic beverages. The company's key products include the following: Products: Non-alcoholic beverages Packaged water Fruit juices Ready-to-drink tea Brands: Coca-Cola Diet Coke/ Coke Light Dasani Fanta Sprite Schweppes POWERade Coca-Cola Zero Capri Sun Chaudfontaine MinuteMaid Dr. Pepper

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Revenue Analysis

REVENUE ANALYSIS
The company recorded revenues of $21,645 million during the financial year ended December 2009 (FY2009), a decrease of 0.7% as compared to 2008. For FY2009, North America, the company's largest geographic market, accounted for 69.9% of the total revenues. CCE generates revenues through one business divisions which accounted for 100% of the companys total revenue during fiscal year 2009. Revenue by Division In FY2009, the companys single business division recorded revenues of $21,645 million, a decrease of 0.7% as compare to 2008. Revenue by Geography* North America, CCEs largest geographical market, accounted for 69.9% of the total revenues in FY2009. Revenues from North America reached $15,128 million in 2009, a decrease of 0.4% as compared to 2008. Europe accounted for 30.1% of the total revenues in FY2009. Revenues from Europe reached $6,517 million in 2009, a decrease of 1.5% as compared to 2008. *Percentages are rounded off.. In October 2010, the company sold its North American bottling operations to Coca-Cola. Simultaneously, it also acquired the Norway and Sweden bottling operations from Coca-Cola.

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SWOT Analysis

SWOT ANALYSIS
Coca-Cola Enterprises (CCE or the company) produces, markets and distributes non-alcoholic beverages. The companys broad product portfolio encompassing various categories of non-alcoholic drinks ensures a wider customer base for the company. It also helps the company to enter new markets and customer segments. However, declining demand for carbonated soft drinks in Europe can render substantial financial losses to the company. Strengths Product offering spread over various categories of non-alcoholic beverages ensures wider customer base Robust distribution network ensures steady flow of business for the company Opportunities Strategic transaction with Coca-Cola would improve the companys operating scale and streamline its cost structure Expanding product portfolio and market share by forming strategic tie-up with top selling brands Growing market for functional drinks in Europe to boost CCEs top line growth Weaknesses Insignificant growth in profit margins reduces the companys financial flexibility

Threats Declining demand for carbonated soft drinks can render substantial financial losses to the company Increasing consumption of private label non-alcoholic beverages to further shrink the companys revenue Intense competition could significantly inflate the companys cost structure thereby decreasing its profit margins

Strengths

Product offering spread over various categories of non-alcoholic beverages ensures wider customer base Coca-Cola Enterprises (CCE) is one of the leading non-alcoholic bottler in the world, and its total volume represents 8% of The Coca-Cola Company's total global volume. In FY2009, CCE served a market of approximately 421 million consumers throughout the US, Canada, the US Virgin Islands, Belgium, continental France, Great Britain, Luxembourg, Monaco, and the Netherlands. CCEs product portfolio comprises a broad range of regular and zero calorie beverage categories including energy drinks, still and sparkling waters, juices, sports drinks, juice drinks, coffee-based beverages and teas. It also includes Coca-Cola, the flagship brand of The Coca-Cola Company.

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SWOT Analysis

In the past few years, the company has also taken up strategic initiatives to further enhance its product offerings with innovative brand extensions and new products. For instance, in FY2009, CCE expanded its energy portfolio through distribution of Monster brands, glaceau brands like smartwater, vitaminwater and vitamin energy. The company also distributes the Schweppes Abbey Well water brand in Great Britain. Therefore, a broad product portfolio encompassing various categories of non-alcoholic drinks ensures a wider customer base for the company. It also helps the company to enter new markets and customer segments. Robust distribution network ensures steady flow of business for the company The company has a strong production and distribution network spread over Europe. With the consolidation of Coca-Colas Norway and Sweden bottling operations to the companys European business, the company operates 18 manufacturing plants in Europe. CCE has 4,200 employees engaged in supply chain operations. In addition to this, the company operates and manages 33 warehouses and 83 production lines working in Europe. The companys customer warehouses distribute 55% of the companys products. The remaining 35% is delivered through wholesalers and 10% is delivered directly by the company. Robust distribution network makes the company a leading player in most of its market. With majority of the market share in Great Britain (31%), France (20%), Belgium (39%) and the Netherlands (19%), the company is a leading supplier of non-alcoholic ready to drink beverages. Thus, CCE is a preferred choice for the distribution of many beverage brands, as its strong distribution network ensures wide spread reach of the product. Hence, a robust distribution network ensures steady flow of business for the company. It also enhances the companys top line growth and profit margins.

Weaknesses

Insignificant growth in profit margins reduces the companys financial flexibility The companys revenue for the period spanning form FY2006 to 2009 has increased with a compound annual growth rate (CAGR) of merely 3%. The companys profit margins have also been gleam during the mentioned time span. During FY2006 to 2009, CCEs operating profit margins fluctuated between -28.8% to 7.5%. Similarly during the same period, the companys net profit margins remained in the range of -20.1% to 3.3%. Thus, weak performance reduces the companys financial flexibility. It also weakens shareholders confidence and the companys creditworthiness.

Opportunities

Strategic transaction with Coca-Cola would improve the companys operating scale and streamline its cost structure

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SWOT Analysis

In October 2010, the company completed the sales of its North American operations to Coca-Cola and simultaneously purchased the Norway and Swedens business operations from the it. Further, under the agreement CCE also has the right to acquire Coca-Colas German bottling operations within 18 to 36 month after the completion of the transaction. With the competition of this transaction, the company will become the third largest Coca-Cola bottler, handling 8% of Coca-Colas global volume. The company will enjoy higher bargaining power and economies of scale because in most of the European regions (Great Britain, France, Benelux, Norway and Sweden), where CCE commands a leading market share. The transaction will add new sources of revenue for the company. In FY2009, the volume sale from Norway and Sweden was 67 million cases. In the same period revenue generated from these two regions was $741 million. Therefore, strong inflow of revenue from the newly acquired business will further add to the companys financial strength. In addition to this, the combined business is expected to increase the companys volume sale to 600 million cases. Thus, the new business structure will create a stronger company in a highly competitive industry and simultaneously create value for its shareholders. It will also improve the companys operating scale and streamline its cost structure. Expanding product portfolio and market share by forming strategic tie-up with top selling brands In the FY2009, the company entered into strategic alliance with companies like Hansen and Ocean Spray International for the distribution of their brands of beverages in the European region. In early 2009, CCE began distributing Monster beverages in all of its European territories under distribution agreements with Hansen. The companys agreement with Hansen extends for 20 years, but can be terminated by either party under certain circumstances. Further in late 2009, CCE entered into agreements with Ocean Spray International for the distribution of Ocean Spray products in Great Britain and France starting January 2010. Following the agreements with Schweppes International Limited, the company would also be commencing the distribution of Schweppes, Dr Pepper and Oasis products in the Netherlands in 2010. Coca-Cola, Danone Group and Group Alma are the top three brand owners of non-alcoholic ready to drink beverages in terms of volume sales. Thus, by forming trade agreements with the top selling brands, CCE can significantly boost its revenue and profit margins. Moreover, a wider product portfolio will help the company to further expand its market share. Growing market for functional drinks in Europe to boost CCEs top line growth The demand for functional drinks (functional drinks market consists of the retail sale of energy drinks, sport drinks and nutraceutical drinks) in Europe has been growing steadily. According to Datamonitors report, the European functional drinks market generated total revenues of $9,100 million in 2009, representing a compound annual growth rate (CAGR) of 5.1% for the period spanning 2005-2009.

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SWOT Analysis

In addition to this, in 2014, the European functional drinks market is expected to have a value of $11,271.6 million, an increase of 24.4% since 2009. Energy drinks sales was most important segment in the European functional drinks market in 2009, generating total revenues of $4,900 million, equivalent to 54% of the market's overall value. The company product mix consists of 35% of sparkling drinks, 35% of functional drinks (comprising of juices, isotonics, teas and coffees) and 30% of water brands. Therefore, by leveraging its wide spread distribution network and product portfolio, CCE can cater to the increasing demand for functional drinks in Europe. By being a part of a rapidly growing market, the company can boost its revenue and enhance profit margins.

Threats

Declining demand for carbonated soft drinks can render substantial financial losses to the company According the Datamonitors report, the European carbonated soft drinks market (the carbonated soft drinks market consists of retail sales of diet cola, standard cola, fruit-flavored carbonates and mixers) decreased by 1.9% in 2009 to reach a value of $ 61,173.5 million. An increased shift of consumer preference towards other beverage options has been the primary cause for the decrease in the demand for carbonated soft drinks. This declining demand shows that the European consumers have started to look for greater variety in their drinks and are becoming increasingly health conscious. Health and wellness trends throughout the marketplace have resulted in a decreased demand for regular soft drinks and an increased desire for more low-calorie soft drinks, water, enhanced water, isotonics, energy drinks, coffee-flavored beverages, teas, and beverages with natural sweeteners. Thus, changing demand patterns can result in substantial financial loss for the company, as CCE is one of the leading companies in Europe offering carbonated soft drinks. The companys revenues can be adversely affected by the slowing European carbonated beverages market. Increasing consumption of private label non-alcoholic beverages to further shrink the companys revenue According to Datamonitors report, the total market value of non-alcoholic beverages across Europe was $185,000 million in 2007. Of this amount, private labels accounted for $38,000 million, following an overall CAGR of 4.2% from 2002 to 2007. The highest level of non-alcoholic beverage private label penetration was in the UK, exceeding $9,000 million in 2007. Further in 2012, the spending on the non-alcoholic beverages is expected to reach $214,028.3 million in Europe, an increase of 32.1% since 2007.

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SWOT Analysis

A major reason for the growing consumption of private label products has been the changing perception of consumers. Usually, consumers perceive private brands to have the same quality, guarantee of satisfaction, packaging, value and performance as national brands carry. Retailers also promote the sales of private labels as it ensures higher profit margins. The decrease in the companys revenue in FY2009, was mainly caused due to lower sales of its higher-margin beverages. The company could witness further decrease in its revenue as the consumption of private label non-alcoholic beverages continues to grow. Decrease in the demand for the companys products would adversely affect its top line growth and profit margins. Intense competition could significantly inflate the companys cost structure thereby decreasing its profit margins In the non-alcoholic beverages segment, CCE competes with many other companies operating in the commercial beverages industry. The company faces intense competition in various markets from regional as well as global players. Also, the company faces competition from various non-alcoholic sparkling beverages including juices and nectars, and fruit drinks. In many of the countries in which the company operates, PepsiCo is one of the company's primary competitors. Competitive factors impacting the company's business include pricing, advertising, sales promotion programs, product innovation, and brand and trademark development and protection. Intense competition on the basis of pricing and advertising can significantly inflate the companys cost structure. It can also restrict CCEs market share and revenue growth rates.

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Top Competitors

TOP COMPETITORS

The following companies are the major competitors of Coca-Cola Enterprises Inc.

Fomento Economico Mexicano, S.A.B. de C.V. The Pepsi Bottling Group, Inc. PepsiAmericas, Inc. PepsiCo, Inc.

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Company View

COMPANY VIEW
A statement by John F. Brock, Chairman and Chief Executive Officer of CCE is given below. The statement has been taken from the companys 2009 annual report. Financial Results Our net income in 2009 was $731 million or $1.48 per diluted common share, compared to a net loss of $4.4 billion or $9.05 per common share in 2008. The following items included in our reported results affected the comparability of our year-over-year financial results (the items listed below are based on defined terms and thresholds and represent all material items management considered for year-over-year comparability): 2009 Charges totaling $114 million ($73 million net of tax, or $0.15 per diluted common share) related to restructuring activities, to streamline and reduce the cost structure of our global back office functions and to support the integration and optimization of our supply chain; Net mark-to-market gains totaling $46 million ($30 million net of tax, or $0.06 per diluted common share) related to non-designated hedges associated with underlying transactions that will occur in a future period; A $9 million ($6 million net of tax, or $0.01 per diluted common share) loss related to the extinguishment of debt during the first quarter of 2009; and A net tax expense totaling $8 million ($0.02 per diluted common share) primarily due to a tax law change in France, offset partially by a net tax rate decrease in certain U.S. states. Financial Summary Our financial performance during 2009 was impacted by the following significant factors: Improved operating performance in North America highlighted by positive margin expansion driven primarily by price-package architecture initiatives and enhanced operating efficiency; A 5.0 percent volume decline in North America reflecting the impact of higher prices, persistent weakness in highermargin products and packages, and lower than expected performance for some highermargin emerging beverage categories;

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Company View

Increased input costs in North America due to package mix shifts associated with highercost still beverages purchased as finished goods and increased cost of sparkling beverage concentrate, offset partially by a moderating raw material cost environment; Solid operating results in Europe driven by balanced volume and pricing growth, strong marketplace execution, and a moderate cost of goods increase; Continued strong performance of Coca-Cola Zero throughout our territories, and the benefit of recent product additions including Monster Energy drinks in all of our territories, vitaminwater10 in our U.S. territories, and Schweppes Abbey Well mineral water in Great Britain; Increased general and administrative expenses primarily driven by performance-related compensation expense under our annual incentive plans and certain share-based payment awards and higher pension expense; The benefits of our OCM practices, which reduced operating expenses by approximately $85 million in North America and allowed us to reinvest into areas of the business that drive growth; and Unfavorable currency exchange rate changes that reduced earnings per diluted common share by approximately $0.15. Revenue In North America, we achieved bottle and can net price per case growth of 6.5 percent primarily through sparkling beverage rate increases implemented in the latter part of 2008 and early 2009 and a slight positive mix shift associated with higherpriced still beverages. Our North American sales volume declined 5.0 percent reflecting the impact of (1) higher sales prices for our multiserve sparkling beverages; (2) persistent weakness in highermargin packages and channels and lower than expected performance for some highermargin emerging beverage categories; and (3) significantly lower sales of Dasani. Despite the overall reduction in volume during 2009, we benefited from our pricepackage architecture initiatives including our 99cent singleserve packages and a variety of can and PET configurations, the continued strong performance of CocaCola Zero, gotomarket innovations such as Boost Zones, and recent product additions including Monster Energy drinks and vitaminwater10. During 2010, we must continue to make progress in North America to further develop our brand and package portfolio, strengthen our pricepackage architecture, and evolve our gotomarket model. We expect the operating environment to remain challenging, but anticipate improving volume trends as we cycle into a more moderate pricing environment. We will also have the opportunity to capture the benefits of several global events during 2010, particularly the 2010 World Cup in South Africa and 2010 Winter Olympic Games in Canada. We are working closely with TCCC to develop strong plans in support of marketing surrounding these

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Coca-Cola Enterprises Inc.

Company View

events. In addition, we will be expanding our Boost Zone program by more than doubling the number of Boost Zones in North America during 2010. Our operations in Europe delivered solid performance during 2009 driven by volume growth of 5.5 percent and pricing growth of 4.0 percent. Solid marketplace execution and the continued success of our Red, Black, and Silver CocaCola trademark brand initiative were the primary drivers of our 2009 volume performance. Our volume in Europe also benefited from the recent addition of several products, including Monster Energy drinks across all of our European territories and Schweppes Abbey Well mineral water in Great Britain. Our 2009 European revenues were significantly impacted by negative currency exchange rate changes. During 2010, we will continue to focus on strong execution and product development as we work through evolving marketplace conditions in Europe. We expect our volume growth next year to be similar to our 2009 growth, as we anticipate strong results for our Red, Black, and Silver CocaCola trademark brands and solid growth within our energy and water portfolios. We will also continue to improve our pricepackage architecture in Europe to ensure we are targeting specific customer and consumer needs. Similar to North America, we expect our volume results in Europe to benefit from marketing initiatives surrounding the 2010 World Cup in South Africa.

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Locations and Subsidiaries

LOCATIONS AND SUBSIDIARIES

Head Office
Coca-Cola Enterprises Inc. 2500 Windy Ridge Parkway Atlanta Georgia 30339 USA P:1 770 989 3000 F:1 770 989 3788 http://www.cokecce.com/

Other Locations and Subsidiaries

Coca-Cola Drycker Sverige AB Besoksaddress Dryckesvagen 2C 136 87 Haninge SWE Coca-Cola Enterprises Charter Place Uxbridge Middlesex UB8 1EZ England GBR Coca-Cola Enterprises Ltd Nobel Road Eley Trading Estate Edmonton N17 3DG GBR

Coca-Cola Enterprises Ltd Cold Drinks Centre 52 Milton Road College Milton East Kilbride Lanarkshire G74 5DJ GBR Coca-Cola Enterprises Ltd The Springs Colwall Malvern Worcestershire WR13 6QQ GBR Coca-Cola Enterprises Ltd. Cray Road Sidcup Kent DA14 5DF GBR

Coca-Cola Enterprises Ltd. 7 Northfield Drive Northfield Milton Keynes Bucks MK15 0DD GBR Coca-Cola Enterprises Ltd. Kenmore Road Wakefield Industrial Park Wakefield WF2 0XR GBR

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