COCA-COLA İÇECEK A.Ş. — Interim / Quarterly Report 2016

May 3, 2016

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Interim Condensed Consolidated Financial Statements as of March 31, 2016

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish) Coca-Cola İçecek Anonim Şirketi Interim Condensed Consolidated Financial Statements as of March 31, 2016 Condensed Consolidated Interim Balance Sheet Condensed Consolidated Interim Income Statement Condensed Consolidated Interim Comprehensive Income Statement Condensed Consolidated Interim Statement of Change in Shareholders’ Equity Condensed Consolidated Interim Statement of Cash Flow Condensed Notes to Consolidated Interim Financial Statements

Page 1 2 3 4 5 6-31

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Consolidated Interim Balance Sheet as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

		Unaudited	Audited
	Notes	March 31, 2016	December31,2015
ASSETS
Current Assets		2.715.167	2.658.277
Cash and Cash Equivalents	4	856.711	1.002.214
Investments in Securities	5	8.724	148
Derivative Financial Instruments	6	-	260
Trade Receivables
- Due from Related Parties	24	63.407	109.681
- Other trade receivables		610.698	448.217
Other Receivables	8	35.051	34.022
Inventories		671.889	620.807
Prepaid Expenses	9	175.888	140.577
Tax Related Current Assets		69.336	70.103
Other Current Assets	17	223.463	232.248
Non-Current Assets		6.193.931	6.287.541
Other Receivables		13.723	16.992
Property, Plant and Equipment	11	4.319.695	4.366.714
Intangible Assets
- Goodwill	13	591.141	606.621
- Other Intangible Assets	12	1.123.539	1.154.210
Prepaid Expenses	9	145.833	140.781
Deferred Tax Assets	22	-	2.223
Total Assets		8.909.098	8.945.818
LIABILITIES
Current Liabilities		1.658.611	1.521.963
Short-term Borrowings	7	180.967	252.757
Current Portion of Long-term Borrowings	7	342.681	310.240
Derivative Financial Instruments	6	5.749	11.279
Trade Payables
- Due to Related Parties	24	171.183	156.218
- Other trade payables		655.292	517.299
Payables Related to Employee Benefits		19.642	21.883
Other Payables	8	192.574	173.861
Provision for Corporate Tax		409	526
Provision for Employee Benefits		56.326	47.819
Other Current Liabilities	17	33.788	30.081
Non-Current Liabilities		3.204.558	3.282.284
Long-term Borrowings	7	2.737.943	2.810.946
Trade Payables
- Due to Related Parties	24	19.848	20.092
- Other Trade payables		1.213	1.213
Derivative Financial Instruments	6	-	98
Provision for Employee Benefits		53.974	52.433
Deferred Tax Liability	22	278.785	281.754
Other Non-Current Liabilities	17	112.795	115.748
EQUITY		4.045.929	4.141.571
Equity of the Parent		3.560.673	3.608.996
Share Capital	18	254.371	254.371
Share Capital Inflation Adjustment Differences		(8.559)	(8.559)
Share Premium		214.241	214.241
Value Increase Funds		9.782	9.782
Cash Flow Hedge Reserve	6	(8.382)	(8.894)
Non-Controlling Interest Put Option Liability Reserve		(6.702)	(6.453)
Actuarial Losses		(16.506)	(16.506)
Currency Translation Adjustment		1.191.359	1.269.372
Restricted Reserves Allocated from Net Profit	18	154.982	154.982
Accumulated Profit		1.746.660	1.629.501
Net Income		29.427	117.159
Non-Controlling Interest		485.256	532.575
Total Liabilities		8.909.098	8.945.818

The explanatory notes form an integral part of these condensed consolidated financial statements

(1)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Consolidated Statement of Income for three months period ended March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

		Unaudited	Unaudited
	Notes	March 31, 2016	March 31,2015
Net Revenue		1.301.322	1.203.038
Cost of Sales (-)		(883.840)	(792.383)
Gross Profit from Operations		417.482	410.655
Distribution, Selling and Marketing Expenses (-)		(293.316)	(257.703)
General and Administration Expenses (-)		(79.520)	(76.716)
Other Operating Income	19	28.946	35.312
Other Operating Expense (-)	19	(29.262)	(37.042)
Profit From Operations		44.330	74.506
Gain from Investing Activities	19	-	649
Loss from Investing Activities (-)	19	(517)	-
Gain / (Loss) from Associates	10	(303)	(338)
Profit Before Financial Income /(Expense)		43.510	74.817
Financial Income	20	94.222	125.328
Financial Expenses (-)	21	(114.414)	(312.019)
Profit Before Tax from Continuing Operations		23.318	(111.874)
Tax Expense of Continuing Operations
Deferred Tax Income / Expense (-)	22	(5.771)	7.931
Current Period Tax Expense (-)		(12.403)	(10.351)
Net Income		5.144	(114.294)
Attributable to:
Non-controlling interest		(24.283)	(23.637)
Equity holders of the parent	23	29.427	(90.657)
		5.144	(114.294)
Equity Holders Earnings Per Share from Continuing Operations (full TL)	23	0,0012	(0,0036)
Equity Holders Earnings Per Diluted Share from Continuing Operations (full TL)	23	0,0012	(0,0036)

The explanatory notes form an integral part of these condensed consolidated financial statements.

(2)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Consolidated Statement of Comprehensive Income For the three months period ended March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

	Unaudited	Unaudited
	March 31, 2016	March 31, 2015
Net Income /(Loss)	5.144	(114.294)
Cash flow hedge reserve	641	3.666
Deferred tax effect	(129)	(733)
Currency translation adjustment	(101.298)	380.347
Other comprehensive income items to be reclassified toprofit or loss subsequently	(100.786)	383.280
Total of Other Comprehensive Income After Tax	(95.642)	268.986
Attributable to:
Non-controlling interest	(47.568)	69.550
Equity holders of the parent	(48.074)	199.436

The explanatory notes form an integral part of these condensed consolidated financial statements.

(3)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Consolidated Statement of Change in Shareholders’ Equity for the three months period ended March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

	Other comprehensive income items	Other comprehensive income items	Other comprehensive income items
	Subsequently not to be reclassified to profit or loss	Subsequently to be reclassified to profit or loss
Consolidated Statement of Changes in Shareholders’ Equity Share Capital Share Capital Inflation Adjustment Differences Share Premium Value Increase Funds Actuarial Gains / (Losses) Cash Flow Hedge Reserve			Option Liability Reserve for Non- Controlling Interest Currency Translation Adjustment Restricted Reserves Accumulated Profit and Current Period Net Income / (Loss)		Total Equity of the Parent Non- Controlling Interest Total Equity
Balance at January 1, 2015 254.371 (8.559) 214.241 9.782 (13.354) 1.641			(442) 682.434 146.232 1.738.473		3.024.819 348.213 3.373.032
Other comprehensive gain / (loss) - - - - - 2.933 Netincome / (loss)forthe period - - - - - -			- 287.160 - - - - - (90.657)		290.093 93.187 383.280 (90.657) (23.637) (114.294)
TotalComprehensiveIncome / (loss) - - - - - 2.933			- 287.160 - (90.657)		199.436 69.550 268.986
Non-controlling interest share put option liability - - - - - -			(41) - - -		(41) 41 -
Balance at March 31, 2015 254.371 (8.559) 214.241 9.782 (13.354) 4.574			(483) 969.594 146.232 1.647.816		3.224.214 417.804 3.642.018
Balance at January 1, 2016 254.371 (8.559) 214.241 9.782 (16.506) (8.894)			(6.453) 1.269.372 154.982 1.746.660		3.608.996 532.575 4.141.571
Other comprehensive gain / (loss) - - - - - 512 Netincome / (loss)forthe period - - - - - -			- (78.013) - - - - - 29.427		(77.501) (23.285) (100.786) 29.427 (24.283) 5.144
TotalComprehensiveIncome / (loss) - - - - - 512			- (78.013) - 29.427		(48.074) (47.568) (95.642)
Non-controlling interest share put option liability - - - - - -			(249) - - -		(249) 249 -
Balance at March 31, 2016 254.371 (8.559) 214.241 9.782 (16.506) (8.382)			(6.702) 1.191.359 154.982 1.776.087		3.560.673 485.256 4.045.929

The explanatory notes form an integral part of these condensed consolidated financial statements.

(4)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Consolidated Statement of Cash Flows for the three months period ended March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

		Unaudited	Unaudited
	Notes	March31, 2016	March31, 2015
Cash flows from operating activities:
Profit / (loss) before tax		23.318	(111.874)
Adjustments to reconcile net profit to net cash provided by operating activities
Depreciation and amortization		102.636	79.684
Loss / (gain) on sale of property, plant and equipment	19	517	(649)
Impairment loss / (reversal) in property, plant and equipment, net	11,19	479	501
Provision for employee termination benefits, management bonus and other accruals		19.882	19.685
Provision / (reversal) for inventories, net		332	2.167
Provision for doubtful receivable, net		289	88
(Gain) / loss from associates	10	303	338
Interest expense	21	39.873	42.804
Interest income	20	(11.081)	(10.707)
Foreign exchange loss / (gain), net		(17.859)	154.586
Net income adjusted for non-cash items		158.689	176.623
Trade, other receivables and due from related parties		(116.495)	(210.344)
Inventories		(51.414)	(130.629)
Other current assets		(24.026)	(626)
Other non-current assets		(5.052)	15.506
Trade, other payables and due to related parties		152.714	114.042
Interest paid		(11.328)	(10.871)
Interest received	20	11.081	10.707
Employee termination benefits, vacation pay, management bonus payments		(17.765)	(24.658)
Taxes paid		(18.391)	(9.832)
Provision for employee benefits		5.690	4.909
Other liabilities		18.899	45.872
Net cash generated from operating activities		**102.602 **	(19.301)
Cash flows from investing activities:
Purchase of property, plant and equipment and intangibles	11,12	(139.733)	(226.781)
Proceeds from sale of property, plant and equipment		1.359	3.845
Investments in securities		(8.576)	2.971
Net cash generated / (used) in investing activities		(146.950)	(219.965)
Cash flows from financing activities:
Proceeds from borrowings		56.793	743
Repayments of borrowings		(133.957)	(15.583)
Cash flow hedge reserve		(4.727)	1.000
Net cash (used) / generated from financing activities		(81.891)	(13.840)
Effects of currency translation on cash and cash equivalents		(11.468)	32.176
Effects of currency translation intercompany borrowings		(14.249)	69.540
Currency translation adjustment		6.453	(1.359)
Net increase / (decrease) in cash and cash equivalents		(145.503)	(152.749)
Cash and cash equivalents at beginning of year	4	1.002.214	756.968
Cash and cash equivalents, period end		856.711	604.219

The explanatory notes form an integral part of these condensed consolidated financial statements.

(5)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

1. CORPORATE INFORMATION and NATURE OF ACTIVITIES

General

Coca-Cola İçecek Anonim Şirketi (“CCI” - “the Company”), is the bottler and distributor of alcohol-free beverages in Turkey, Pakistan, Central Asia and the Middle East. The operations of the Company consist of production, sales and distribution of sparkling and still beverages with The Coca-Cola Company (“TCCC”) trademarks. The Company has 9 (2015 - 9) production facilities in different regions of Turkey and operates 16 (2015 - 16) production facilities in countries other than Turkey. The registered office address of CCI is Esenkent Mah. Deniz Feneri Sok. No:4 Ümraniye İstanbul, Turkey. CCI is a listed company on the Borsa Istanbul A.Ş. (“BIST”), which is the new registered official title of Istanbul Stock Exchange (“ISE”), starting from April 2013. The American Depositary receipt issued under the Level I ADR program are traded over the counter in the United States, starting from July 2013. The sale of Capital Markets Board Tranche Issuance Certificated bonds to investors outside of Turkey has been completed as of October 1, 2013, and these bonds were admitted to Irish Stock Exchange.

The Group consists of the Company, its subsidiaries and joint ventures.

The consolidated financial statements of the Group were approved for issue by the Board of Directors on May 3, 2016, which were signed by the Audit Committee and Chief Financial Officer Nusret Orhun Köstem. The General Assembly and the regulatory bodies have the right to make amendments on the financial statements after their issuance.

Shareholders of the Company

Anadolu Efes Biracılık ve Malt Sanayi A.Ş. is the ultimate controlling party of the Company. As of March 31, 2016 and December 31, 2015 the composition of shareholders and their respective percentage of ownership can be summarized as follows:

	March	31, 2016	December	31,2015
	Nominal		Nominal
	Amount	Percentage	Amount	Percentage
Anadolu Efes Biracılık ve Malt Sanayi A.Ş. (“Anadolu Efes”)	102.047	40,12%	102.047	40,12%
The Coca-Cola Export Corporation (“TCCEC”)	51.114	20,09%	51.114	20,09%
Efes Pazarlama ve Dağıtım Ticaret A.Ş. (“Efpa”)	25.788	10,14%	25.788	10,14%
Özgörkey Holding A.Ş.	9.392	3,69%	9.392	3,69%
Publicly Traded	66.030	25,96%	66.030	25,96%
	254.371	100,00%	254.371	100,00%
Restatement Effect	(8.559)	-	(8.559)	-
	245.812		245.812

Özgörkey Holding A.Ş. shares with a nominal value of TL 3.033 has been listed to Central Registry Agency, with a sale purpose.

Nature of Activities of the Group

CCI and its subsidiary Coca-Cola Satış ve Dağıtım A.Ş. (“CCSD”) are among the leading bottlers and distributors of alcohol-free beverages, operating in Turkey. The sole operation area of the Company is production, sales and distribution of sparkling and still beverages.

The Company has exclusive rights to produce, sell and distribute TCCC branded beverages including Coca-Cola, Coca-Cola Zero, Coca-Cola Light, Fanta, Sprite, Cappy, Sen Sun, Powerade and Fuse Tea in TCCC authorized packages throughout Turkey provided with Bottler’s and Distribution Agreements signed between the Group with TCCEC and TCCC. Renewal periods of the signed Bottler’s and Distribution Agreements varies between 2016 and 2018.

The Company has the exclusive right to produce, sell and distribute Burn and Gladiator branded energy drinks in authorized packages throughout Turkey according to the Bottlers Agreement signed between the Company and Monster Energy Company (“MEC”) which has taken over TCCC’s global energy drink portfolio and is partially owned by TCCC as well.

According to Sales and Distribution Agreement signed with Doğadan Gıda Ürünleri Sanayi ve Pazarlama A.Ş. (“Doğadan”), a subsidiary of TCCC, it’s approved that sales and distribution of Doğadan products will be realized by CCSD throughout Turkey starting from September 2008.

(6)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

1. CORPORATE INFORMATION and NATURE OF ACTIVITIES (continued)

The Company’s international subsidiaries and joint ventures operating outside of Turkey are also engaged in the production, sales and distribution of sparkling and still beverages with TCCC trademarks.

Company’s subsidiary Mahmudiye Kaynak Suyu Limited Şirketi (“Mahmudiye”), which was acquired by CCI on March 16, 2006, is engaged in the production and filling of natural spring water Damla, a registered trademark of CCI, with TCCC approved packages, in Turkey.

Group has the exclusive bottling and distribution rights in Turkey for Schweppes branded beverages under Bottler’s and Distribution Agreement signed with Schweppes Holdings Limited. Special authorization for the Group operating countries, other than Turkey, may be granted from time to time.

Subsidiaries and Joint Ventures

As of March 31, 2016 and December 31, 2015 the list of CCI’s subsidiaries and joint ventures and its effective participation percentages are as follows:

Subsidiaries

				Effective Shareholding and	Effective Shareholding and
				Voting Rights %
		Place of	Principal	March 31,	December 31,
		**Incorporation **	Activities	2016	2015
1)	Coca-Cola Satış ve Dağıtım Anonim Şirketi (“CCSD”)	Turkey	Distribution and sales of Coca-Cola, Doğadan and Mahmudiye products	99,97%	99,97%
2)	Mahmudiye Kaynak Suyu Limited Şirketi (“Mahmudiye”)	Turkey	Filling of natural spring water	100,00%	100,00%
3)	J.V. Coca-Cola Almaty Bottlers Limited Liability Partnership (“Almaty CC”)	Kazakhstan	Production, distribution and sales of Coca-Cola products	100,00%	100,00%
4)	Azerbaijan Coca-Cola Bottlers Limited Liability Company (“Azerbaijan CC”)	Azerbaijan	Production, distribution and sales of Coca-Cola products	99,87%	99,87%
5)	Coca-Cola Bishkek Bottlers Closed Joint Stock Company (“Bishkek CC”)	Kyrgyzstan	Production, distribution and sales of Coca-Cola products	100,00%	100,00%
6)	CCI International Holland B.V. (“CCI Holland”)	Holland	Holding company	100,00%	100,00%
7)	Tonus Turkish-Kazakh Joint Venture Limited Liability Partnership (“Tonus”)	Kazakhstan	Holding company	100,00%	100,00%
8)	The Coca-Cola Bottling Company of Jordan Limited (“TCCBCJ”)	Jordan	Production, distribution and sales of Coca-Cola products	90,00%	90,00%
9)	Turkmenistan Coca-Cola Bottlers (“Turkmenistan CC”)	Turkmenistan	Production, distribution and sales of Coca-Cola products	59,50%	59,50%
10)	(CC) Company for Beverages Industry/Ltd. (“CCBIL”)	Iraq	Production, distribution and sales of Coca-Cola products	100,00%	100,00%
11)	Waha Beverages B.V. (“Waha B.V.”)	Holland	Holding Company	80,03%	80,03%
12)	Coca-Cola Beverages Tajikistan Limited Liability Company (“Tajikistan CC”)	Tajikistan	Production, distribution and sales of Coca-Cola products	100,00%	100,00%
13)	Al Waha for Soft Drinks, Juices, Mineral Water, Plastics, and Plastic Caps Production LLC (“Al Waha”)	Iraq	Production, distribution and sales of Coca-Cola products	80,03%	80,03%
14)	Coca-Cola Beverages Pakistan Limited (“CCBPL”)	Pakistan	Production, distribution and sales of Coca-Cola products	49,67%	49,67%

(7)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

1. CORPORATE INFORMATION and NATURE OF ACTIVITIES (continued)

Joint Venture

	Place of	Principal	Effective Shareholding and	Effective Shareholding and
	**Incorporation **	Activities	**Voting **	Rights %
			March 31,	December 31,
			2016	2015
Syrian Soft Drink Sales and Distribution L.L.C. (‘‘SSDSD’’)	Syria	Distribution and sales of Coca- Cola products	50,00%	50,00%

Economic Conditions and Risk Factors of Subsidiaries and Joint Ventures in Foreign Countries

The countries, in which certain subsidiaries and joint ventures operate, have undergone substantial political and economic changes in recent years. Uncertainties regarding the political, legal, tax and/or regulatory environment, including the potential for adverse changes in any of these factors, could significantly affect the subsidiaries’ and joint ventures ability to operate commercially. Group Management closely monitors uncertainties and adverse changes to minimize the probable effects of such changes.

In this context, Risk Detection Committee; which was established under the arrangements, terms and principles of Turkish Commercial Code, Capital Market Legislation and Capital Markets Board’s “Corporate Governance Principles” assess, manage and report Group risks. Some of the Group priority risks are defined as consumer shift to alternative beverages, security and safety of employees, volatile tax and regulatory environment, economic slowdown and exchange rate volatility and management of environmental effects and reputation. Group does not expect any adverse effect on the business related to any significant regulatory changes and/or legal arrangements by the authorities. All compliance efforts are in place and there is no legal dispute that may adversely affect the business.

Seasonality of Operations

Sparkling beverages consumption is seasonal, typically resulting in higher demand during the summer season and accordingly the seasonality effects are reflected in the figures. Therefore the results of operations for the three months period ended March 31, 2016 do not automatically constitute an indicator for the results to be expected for the overall fiscal year.

Average Number of Employees

Category-based average number of employees working during the period is as follows (joint ventures are considered with full numbers for March 31, 2016 and 2015).

	March 31, 2016	March31,2015
Blue-collar	4.171	4.964
White-collar	5.160	5.433
Average number of employees	9.331	10.397

(8)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

2. BASIS OF PRESENTATION

Basis of Preparation

CCI and its subsidiaries that are incorporated in Turkey maintain their books of account and prepare their statutory financial statements in Turkish Lira (“TL”) in accordance with the regulations on accounting and reporting framework and accounting standards promulgated by the Capital Markets Board of Turkey (“CMB”), Turkish Commercial Code (“TCC”) and Tax Legislation and the Uniform Chart of Accounts which is issued by the Ministry of Finance. The subsidiaries incorporated outside of Turkey maintain their books of account and prepare their statutory financial statements in accordance with the regulations of the countries in which they operate.

The condensed consolidated interim financial statements have been prepared from the statutory financial statements of Group’s subsidiaries’ and joint ventures and presented in TL in accordance with CMB Accounting Standards with certain adjustments and reclassifications for the purpose of fair presentation. Such adjustments are primarily related to application of consolidation accounting, accounting for business combinations, accounting for deferred taxes on temporary differences, accounting for employee termination benefits on an actuarial basis and accruals for various expenses. Except for the financial assets carried from their fair values and assets and liabilities included in Business Combination application, financial statements are prepared on a historical cost basis.

The condensed consolidated interim financial statements and disclosures have been prepared in accordance with the communiqué numbered II-14,1 “Communiqué on the Principles of Financial Reporting In Capital Markets” (“the Communiqué”) announced by the CMB (hereinafter will be referred to as “the CMB Accounting Standards”) on June 13, 2013 which is published on Official Gazette numbered 28676.

In accordance with article 5 of the CMB Accounting Standards, companies should apply Turkish Accounting Standards / Turkish Financial Reporting Standards (“TAS” / “TFRS”) and interpretations regarding these standards as adopted by the Public Oversight Accounting and Auditing Standards Authority (“POA”).

For the period ended March 31, 2016, the Group prepared its condensed consolidated interim financial statements in accordance with the Turkish Accounting Standard No.34 “Interim Financial Reporting”. Interim condensed consolidated financial statements of the Group do not include all the information and disclosures required in the annual financial statements, therefore should be read in conjunction with the Group’s annual consolidated financial statements as of December 31, 2015.

The condensed consolidated interim financial statements are based on the statutory records, with adjustments and reclassifications for the purpose of fair presentation in accordance with the Accounting Standards of the POA and are presented in TL.

Summary of Significant Accounting Policies

The interim condensed consolidated financial statements of the Group for the three months period ended March 31, 2016 have been prepared in accordance with the accounting policies used in the preparation of annual consolidated financial statements for the year ended December 31, 2015, except for the adoption of new and amended standards.

Interim condensed consolidated financial statements do not include the information and disclosures required in the annual financial statements. Accordingly, these condensed interim consolidated financial statements should be read in conjunction with the annual consolidated financial statements for the year ended December 31, 2015.

a) Standards, amendments and interpretations applicable as at 31 March 2016:

Amendment to IFRS 11, 'Joint arrangements' on acquisition of an interest in a joint operation, effective from annual periods beginning on or after 1 January 2016. This amendment adds new guidance on how to account for the acquisition of an interest in a joint operation that constitutes a business. The amendments specify the appropriate accounting treatment for such acquisitions. The Group does not expect that this amendment will have an impact on the financial position or performance of the Group.

(9)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

2. BASIS OF PRESENTATION (continued)

Amendments to IAS 16 ‘Property, plant and equipment’, and IAS 41, ‘Agriculture’ , regarding bearer plants, effective from annual periods beginning on or after 1 January 2016. These amendments change the financial reporting for bearer plants, such as grape vines, rubber trees and oil palms. It has been decided that bearer plants should be accounted for in the same way as property, plant and equipment because their operation is similar to that of manufacturing. Consequently, the amendments include them within the scope of IAS 16, instead of IAS 41. The produce growing on bearer plants will remain within the scope of IAS 41. The Group does not expect that this amendment will have an impact on the financial position or performance of the Group.

Amendment to IAS 16, 'Property, plant and equipment' and IAS 38, 'Intangible assets' , on depreciation and amortisation, effective from annual periods beginning on or after 1 January 2016. In this amendment it has clarified that the use of revenue based methods to calculate the depreciation of an asset is not appropriate because revenue generated by an activity that includes the use of an asset generally reflects factors other than the consumption of the economic benefits embodied in the asset. It is also clarified that revenue is generally presumed to be an inappropriate basis for measuring the consumption of the economic benefits embodied in an intangible asset. The Group does not expect that this amendment will have an impact on the financial position or performance of the Group.

IFRS 14 ‘Regulatory deferral accounts’ , effective from annual periods beginning on or after 1 January 2016. IFRS 14, ‘Regulatory deferral accounts’ permits first–time adopters to continue to recognise amounts related to rate regulation in accordance with their previous GAAP requirements when they adopt IFRS. However, to enhance comparability with entities that already apply IFRS and do not recognise such amounts, the standard requires that the effect of rate regulation must be presented separately from other items. The Group does not expect that this amendment will have an impact on the financial position or performance of the Group.

Amendments to IAS 27, ‘Separate financial statements’ on the equity method , effective from annual periods beginning on or after 1 January 2016. These amendments allow entities to use the equity method to account for investments in subsidiaries, joint ventures and associates in their separate financial statements. The Group does not expect that this amendment will have an impact on the financial position or performance of the Group.

Amendments to IFRS 10, ‘Consolidated financial statements’ and IAS 28, ‘Investments in associates and joint ventures’ , effective from annual periods beginning on or after 1 January 2016. These amendments address an inconsistency between the requirements in IFRS 10 and those in IAS 28 in dealing with the sale or contribution of assets between an investor and its associate or joint venture. The main consequence of the amendments is that a full gain or loss is recognised when a transaction involves a business (whether it is housed in a subsidiary or not). A partial gain or loss is recognised when a transaction involves assets that do not constitute a business, even if these assets are housed in a subsidiary. The Group does not expect that this amendment will have an impact on the financial position or performance of the Group.

Annual improvements 2014 , effective from annual periods beginning on or after 1 January 2016. These set of amendments impacts 4 standards:

• IFRS 5, ‘Non-current assets held for sale and discontinued operations’ regarding methods of disposal.

• IFRS 7, ‘Financial instruments: Disclosures’, (with consequential amendments to IFRS 1) regarding servicing contracts.

• IAS 19, ‘Employee benefits’ regarding discount rates.

• IAS 34, ‘Interim financial reporting’ regarding disclosure of information.

Amendment to IAS 1, ‘Presentation of financial statements’ on the disclosure initiative, effective from annual periods beginning on or after 1 January 2016, these amendments are as part of the IASB initiative to improve presentation and disclosure in financial reports. The Group does not expect that this amendment will have an impact on the financial position or performance of the Group.

(10)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

2. BASIS OF PRESENTATION (continued)

Amendment to IFRS 10 ‘Consolidated financial statements’ and IAS 28, ‘Investments in associates and joint ventures’ , effective from annual periods beginning on or after 1 January 2016.These amendments clarify the application of the consolidation exception for investment entities and their subsidiaries. The Group does not expect that this amendment will have an impact on the financial position or performance of the Group.

b) Standards, amendments and interpretations effective after 31 March 2016:

IAS 7 ‘effective from annual periods beginning on or after 1 January 2017. The improvements are part of the Board’s Disclosure Initiative. The amendments require companies to provide information about changes in their financing liabilities and come as a response to requests from investors for information that helps them better understand changes in a company’s debt. The amendments will help to evaluate changes in liabilities arising from financing activities, including changes from cash flows and non-cash changes (such as foreign exchange gains or losses). The Group is in the process of assessing the impact of the new standard on the financial position of the Group.

IAS 12 ‘Income Taxes’ effective from annual periods beginning on or after 1 January 2017. The amendments clarify the accounting for deferred tax where an asset is measured at fair value and that fair value is below the asset’s tax base. It also clarify certain other aspects of accounting for deferred tax assets. The Group does not expect that this amendment will have an impact on the financial position or performance of the Group.

IFRS 15 ‘Revenue from contracts with customers’ , effective from annual periods beginning on or after 1 January 2018. IFRS 15, ‘Revenue from contracts with customers’ is a converged standard from the IASB and FASB on revenue recognition. The standard will improve the financial reporting of revenue and improve comparability of the top line in financial statements globally. The Group is in the process of assessing the impact of the new standard on the financial position of the Group.

IFRS 9 ‘Financial instruments’, effective from annual periods beginning on or after 1 January 2018. This standard replaces the guidance in IAS 39. It includes requirements on the classification and measurement of financial assets and liabilities; it also includes an expected credit losses model that replaces the current incurred loss impairment model. The Group is in the process of assessing the impact of the new standard on the financial position of the Group.

IFRS 16 ‘leases’ effective from annual periods beginning on or after 1 January 2019, with earlier application permitted if IFRS 15, ‘Revenue from Contracts with Customers’, is also applied. New standard requires lessees to recognise a lease liability reflecting future lease payments and a ‘right-of-use asset’ for virtually all lease contracts. The IASB has included an optional exemption for certain short-term leases and leases of low-value assets; however, this exemption can only be applied by lessees. For lessors, the accounting stays almost the same. The Group is in the process of assessing the impact of the new standard on the financial position of the Group.

Estimation Uncertainty

For the interim consolidated financial statements as of March 31, 2016, Group management has to make key assumptions concerning the future and other key sources of estimation uncertainty on the balance sheet date that have significant risks of causing a material adjustment to the carrying amounts of assets and liabilities in the preparation of consolidated financial statements. Actual results can be different from estimations. These estimations are reviewed at each balance sheet date; required corrections are made and reflected in the results of operations of the related period. The key assumptions concerning the future and other key resources of estimation at the balance sheet date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year and the significant judgments (apart from those involving estimations) with the most significant effect on amounts recognized in the financial statements are consistent with the assumptions and estimations made for the year ended December 31, 2015, except for the necessary considerations made for income taxes.

(11)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

2. BASIS OF PRESENTATION (continued)

Functional and Presentation Currency

Functional and presentation currency of the Company is Turkish Lira (TL).

Functional Currencies of the Subsidiaries and Joint Ventures

	**March **	31, 2016	December	31, 2015
	Local Currency	Functional Currency	Local Currency	Functional Currency
CCSD	Turkish Lira	Turkish Lira	Turkish Lira	Turkish Lira
Mahmudiye	Turkish Lira	Turkish Lira	Turkish Lira	Turkish Lira
Almaty CC	Kazakh Tenge	U.S. Dollars	Kazakh Tenge	U.S. Dollars
Tonus	Kazakh Tenge	U.S. Dollars	Kazakh Tenge	U.S. Dollars
Azerbaijan CC	Manat	U.S. Dollars	Manat	U.S. Dollars
Turkmenistan CC	Turkmen Manat	U.S. Dollars	Turkmen Manat	U.S. Dollars
Bishkek CC	Som	U.S. Dollars	Som	U.S. Dollars
TCCBCJ	Jordanian Dinar	U.S. Dollars	Jordanian Dinar	U.S. Dollars
CCBIL	Iraq Dinar	U.S. Dollars	Iraq Dinar	U.S. Dollars
SSDSD	Syrian Pound	U.S. Dollars	Syrian Pound	U.S. Dollars
CCBPL	Pakistan Rupee	Pakistan Rupee	Pakistan Rupee	Pakistan Rupee
CCI Holland	Euro	U.S. Dollars	Euro	U.S. Dollars
Waha B.V.	Euro	U.S. Dollars	Euro	U.S. Dollars
Al Waha	Iraq Dinar	U.S. Dollars	Iraq Dinar	U.S. Dollars
Tajikistan CC	Somoni	U.S. Dollars	Somoni	U.S. Dollars

The multinational structure of foreign operations and realization of most of their operations in terms of U.S. Dollars (“USD”) resulted in determination of the foreign subsidiaries’ and joint ventures’ functional currency as USD except Pakistan. The majority of the consolidated foreign subsidiaries and joint ventures are regarded as foreign operations since they are financially, economically and organizationally autonomous.

Since the functional and presentation currency of foreign subsidiaries and joint ventures are determined as USD in the consolidated financial statements, USD amounts presented in the balance sheet are translated into Turkish Lira at the official TL exchange rate for purchases of USD announced by the Central Bank of the Republic of Turkey on March 31, 2016, USD 1,00 (full) = TL 2,8334 (December 31, 2015; USD 1,00 (full) = TL 2,9076). Furthermore, USD amounts in the income statement have been translated into TL, at the average TL exchange rate for purchases of U.S. Dollars for the three months period ended March 31, 2016 is USD 1,00 (full) = TL 2,9409 (January 1, - March 31, 2015; USD 1,00 (full) = TL 2,4571).

(12)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

3. SEGMENT REPORTING

The Company produces segment reports for the chief operating decision maker (Board of Directors and Executive Management) in accordance with basis of preparation as explained in Note 2. Reported information is used by management for observing performance at operation segments and for deciding resource allocation.

Transfer prices between related parties are on an arm's length basis in a manner similar to transactions with third parties.

Group’s subsidiaries and joint ventures presented under Note 1 and Group’s segment reporting is as follows:

		March 31, 2016	March 31, 2016
	Domestic	International	**Elimination **	Consolidated
Net Revenue	683.487	617.951	(116)	1.301.322
Cost ofsales (-)	(410.156)	(473.938)	254	(883.840)
Grossprofit	273.331	144.013	138	417.482
Operating expenses (-)	(218.869)	(162.855)	8.888	(372.836)
Other operating income / (expense), net	63.994	1.271	(65.581)	(316)
Profit /(loss) from operations	118.456	(17.571)	(56.555)	44.330
Gain from investing activities	495	-	(495)	-
Loss from investing activities (-)	(121)	(891)	495	(517)
Gain/ (loss)fromassociates	-	(303)	-	(303)
Profit before financial income/(expense)	118.830	(18.765)	(56.555)	43.510
Financial income	98.301	3.182	(7.261)	94.222
Financial expense (-)	(85.599)	(36.076)	7.261	(114.414)
**Profit / (loss) before tax **	131.532	(51.659)	(56.555)	23.318
Tax income / (expense)	(9.924)	(6.735)	(1.515)	(18.174)
Net income / (loss)	121.608	(58.394)	(58.070)	5.144
Non-controlling interest	-	(24.025)	(258)	(24.283)
Equity holders of the parent	121.608	(34.369)	(57.812)	29.427
Purchase of property, plant, equipment and intangible asset	78.460	61.273	-	139.733
Depreciation and amortization expenses	33.145	69.717	(226)	102.636
Other non-cash items	5.481	3.491	(45)	8.927
Earnings before interest and tax (EBITDA)	157.456	54.443	(56.826)	155.073
		March 31, 2016
	Domestic	International	Elimination	Consolidated
Total Assets	4.962.517	4.581.911	(635.330)	8.909.098
Total Liabilities	3.207.456	2.123.336	(467.623)	4.863.169

As of March 31, 2016, the portion of Almaty CC in the consolidated net revenue and total assets is 9% and 9% respectively.

As of March 31, 2016, the portion of CCBPL in the consolidated net revenue and total assets is 21% and 17% respectively.

As of March 31, 2015, the portion of Almaty CC in the consolidated net revenue and total assets is 13% and 9% respectively.

As of March 31, 2015, the portion of CCBPL in the consolidated net revenue and total assets is 17% and 18% respectively.

(13)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

3. SEGMENT REPORTING (continued)

		March 31, 2015	March 31, 2015
	Domestic	International	Elimination	Consolidated
Net Revenue	626.477	577.067	(506)	1.203.038
Cost ofsales (-)	(375.689)	(417.368)	674	(792.383)
Grossprofit	250.788	159.699	168	410.655
Operating expenses (-)	(193.008)	(146.623)	5.212	(334.419)
Otheroperatingincome / (expense),net	32.042	(1.474)	(32.298)	(1.730)
Profit / (loss) from operations	89.822	11.602	(26.918)	74.506
Gain from investing activities	666	403	(420)	649
Loss from investing activities (-)	(420)	-	420	-
Gain/ (loss)fromassociates	-	(338)	-	(338)
Profit before financial income/(expense)	90.068	11.667	(26.918)	74.817
Financial income	130.621	1.194	(6.487)	125.328
Financialexpense (-)	(287.023)	(31.483)	6.487	(312.019)
**Profit / (loss) before tax **	(66.334)	(18.622)	(26.918)	(111.874)
Tax income / (expense)	17.698	(20.079)	(39)	(2.420)
Net income /(loss)	(48.636)	(38.701)	(26.957)	(114.294)
Non-controlling interest	-	(23.598)	(39)	(23.637)
Equity holders of the parent	(48.636)	(15.103)	(26.918)	(90.657)
Purchase of property, plant, equipment and intangible asset	21.531	205.250	-	226.781
Depreciation and amortization expenses	29.952	49.928	(196)	79.684
Other non-cash items	2.278	4.685	244	7.207
Earnings before interest and tax (EBITDA)	122.298	66.280	(26.870)	161.708
		December 31, 2015
	Domestic	International	Elimination	Consolidated
Total Assets	4.759.657	4.718.881	(532.720)	8.945.818
Total Liabilities	3.126.108	2.068.606	(390.467)	4.804.247

Company’s “Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)” definition and calculation is defined as; “Profit before financial income/(expense)” plus relevant non-cash expenses including depreciation and amortization, impairment loss, provision for employee benefits like retirement and vacation pay (provision for management bonus not included), other non-cash expense, minus relevant non-cash income including negative goodwill, value increase due to change in scope of consolidation and reversal for the impairment of fixed assets.

Effect of the CMB classification differences according to new illustrative financial statements and reporting guide as which; the effect of “foreign exchange gain / (loss) classified to “other operating income and expense” and “Gain / (loss) from associates” were excluded from the EBITDA calculation, for the consistency of the comparison. As of March 31, 2016 and 2015, reconciliation of EBITDA to Profit before financial income/(expense) is explained in the following table:

	March 31, 2016	March31,2015
Profit before financial income/(expense)	43.510	74.817
Depreciation and amortization	102.636	79.684
Provision for employee benefits	5.467	4.361
Provision / (Reversal) for the impairment of fixed assets (Note 11, Note 19)	479	501
Foreign exchange gain / (loss) under other operating income / (expense) (Note 19)	2.678	1.965
Gain / (loss) from associates (Note 10)	303	338
Other	-	42
EBITDA	155.073	161.708

(14)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

4. CASH AND CASH EQUIVALENTS

	March 31, 2016 December 31,2015
Cash on hand Cash in banks -Time -Demand Cheques	3.008 2.724 713.344 905.612 133.185 90.549 7.174 3.329
	856.711 1.002.214

As of March 31, 2016 time deposits with maturities less than three months in foreign currencies equivalent to TL 580.891, existed for periods varying between 1 day to 74 days (December 31, 2015 – TL 524.309, 1 day to 78 days) and earned interest between 0,20 % - 15% (December 31, 2015 - 0,20% - 4,25%).

As of March 31, 2016 time deposits in local currency amounting to TL 132.453 existed for periods varying between 1 days to 77 days (December 31, 2015 - TL 381.303, 4 days to 78 days) and earned interest between 12,55% - 14,00% (December 31, 2015 - 11,60% - 13,85%).

As of March 31, 2016, there is TL 1.587 (December 31, 2015 - TL 2.811) of interest income accrual on time deposits with maturities less than 3 months. As of March 31, 2016 and December 31 2015, the fair values of cash and cash equivalents are equal to book value.

As of March 31, 2016, TL 178.467 (USD 63,0 million) on time deposits are reserved for the future raw materials purchases.

5. INVESTMENTS IN SECURITIES

			March 31, 2016	December31,2015
Time deposits with maturities more than	3	months	8.724	148
			8.724	148

As of March 31, 2016 time deposits with maturities over 3 months made for 115 days period are composed of USD and earned interest is 2,00% (December 31, 2015 - USD, 206 days, 2,00%).

As of March 31, 2016, there is TL 43 (December 31, 2015 – TL 3) of interest income accrual on time deposits with maturities over 3 months.

6. DERIVATIVE FINANCIAL INSTRUMENTS

As of March 31, 2016, the Company has 9 aluminum swap transactions with a total nominal amount of TL 42.006 for 8.408 tones. The total of these aluminum swap contracts are designated as hedging instruments as of January 13, 2015, May 29, 2015, June 25, 2015 and July 27, 2015 in cash flow hedges related to forecasted cash flow, for the high probability purchases of production material exposed to commodity price risk (Note 26).

FX forward transactions with a total nominal amount of TL 79.087 (December 31, 2015 - TL 101.766) for 3 forward purchase contracts amounting to USD 28 million as of March 31, 2016 (December 31, 2015 - USD 35 million), are undesignated as hedging instruments exposed to foreign currency risk as of the balance sheet date and recognized initially at fair value. As of March 31, 2016, related derivatives are measured at fair value and changes in the fair values are recognized in the statement of consolidated income as part of finance income and costs.

All the changes in the fair value of commodity swap and forward derivative financial instruments, that are accounted as hedge accounting, are effective and recognized in consolidated other comprehensive income.

	March	31, 2016	December31,2015	December31,2015
	Nominal	Fair Value Assets	Nominal	Fair Value Assets
	Value	/(Liabilities)	Value	/ (Liabilities)
Held for hedging:
Commodity swap contracts fair value assets/(liabilities)	42.006	(5.749)	54.283	(7.812)
Forward contracts assets /(liabilities)	-	-	101.766	(3.305)
	42.006	(5.749)	156.049	(11.117)

(15)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

7. BORROWINGS

. BORROWINGS
	March 31, 2016	December31,2015
Short-term borrowings	180.967	252.757
Current portion of long-term borrowings	342.681	310.240
Totalshort-termborrowings	523.648	562.997
Long-term borrowings	2.737.943	2.810.946
Total borrowings	3.261.591	3.373.943

As of March 31, 2016, there is interest expense accrual amounting to TL 48.355 on total amount of borrowings (December 31, 2015 - TL 20.092).

Short and long-term borrowings denominated in TL and foreign currencies as of March 31, 2016 and December 31, 2015 are as follows:

hort and long-term borrowings ecember 31, 2015 are as follows:	denominated in TL and foreign currencies	denominated in TL and foreign currencies	as of March 31, 2016 and	as of March 31, 2016 and
	March 31, 2016		December31,2015
	Short-term	Long-term	Short-term	Long-term
USD	108.630	2.387.885	150.183	2.449.214
EUR	293.411	325.281	218.077	336.036
TL	6.109		3.966	-
Pakistan Rupee	108.092		184.772	-
Kazakh Tenge	126	24.777	129	25.696
Jordanian Dinar	7.280		5.870	-
	523.648	2.737.943	562.997	2.810.946

Range for the minimum and maximum effective interest rates on the balance sheet date are as follows:

March 31, 2016 December 31, 2015 Short-term USD denominated borrowings - (3M Libor+2,00%) EURO denominated borrowings (6M Euribor + 1,00%) - Jordanian dinar denominated borrowings (7,25% - 8,8%) (8,8%) Pakistan Rupee denominated borrowings (1M Kibor+0,25%) - (1M Kibor+0,50%) (1M Kibor+0,40%) - (3M Kibor+0,50%) Long-term USD denominated borrowings (3M Libor+2,10%) - (4,75%) (3M Libor+2,10%) - (4,75%) EUR denominated borrowings (3M Euribor+1,25%) - (6M Euribor+1,75%) (3M Euribor+1,25%) - (6M Euribor+1,75%) KZT denominated borrowings (6,00%) (6,00%)

Repayment plans of long-term borrowings as of March 31, 2016 and December 31, 2015 are scheduled as follows (including current portion of long-term borrowings):

	March 31, 2016	December 31,2015
2016	328.926	310.240
2017	145.707	152.851
2018	1.865.433	1.887.374
2019	103.094	104.521
2020	297.456	318.051
2023	340.008	348.149
	3.080.624	3.121.186

(16)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

8. OTHER RECEIVABLES AND PAYABLES

Other Receivables

	March 31, 2016	December31,2015
Due from personnel	6.805	6.393
Deposits and guarantees given	3.434	3.850
Receivable from tax office and other official receivables	17.272	16.606
Other	7.540	7.173
	35.051	34.022
ther Payables
	March 31, 2016	December31,2015
Deposits and guarantees	142.836	136.957
Taxes and duties payable	46.828	32.562
Other	2.910	4.342
	192.574	173.861

Other Payables

9. PREPAID EXPENSES

a) Short term prepaid expenses

a) Short term prepaid expenses
	March 31, 2016	December31,2015
Prepaid marketing expenses	82.960	54.506
Prepaid insurance expenses	7.089	11.620
Prepaid rent expenses	6.802	7.083
Prepaid other expenses	15.226	7.214
Advances given	63.811	60.154
	175.888	140.577
b) Long term prepaid expenses
	March 31, 2016	December 31, 2015
Prepaid marketing expenses	101.842	97.158
Prepaid rent expenses	28.898	30.572
Prepaid other expenses	200	666
Advances given	14.893	12.385
	145.833	140.781

10. INVESTMENT IN ASSOCIATES

Investment in associates, consolidated under the equity method of accounting, is carried in the consolidated balance sheet at cost plus post-acquisition changes in the Group’s share of net assets of the associates, less any impairment in value. The consolidated income statement reflects the Group’s share of the results of operations of the associates.

As of March 31, 2016, shareholder loan payables of SSDSD in proportion to shareholdings with a total amount of USD 3 million has been converted as share capital in its statutory financials, to be set off from accumulated losses.

The carrying value of SSDSD at the consolidated balance sheet with an amount of TL 566 loss was netted off with trade receivables from SSDSD at the consolidated financial statements ( December 31, 2015 TL 983 loss). As of March 31, 2016 and 2015 total assets, total liabilities, net sales and current period loss of SSDSD is as follows:

**SSDSD **	March 31, 2016	December 31, 2015
Total Assets	1.949	2.358
Total Liabilities	5.140	13.756
Equity	(3.191)	(11.398)
SSDSD	March 31, 2016	March31,2015
Revenue	-	944
Net Loss	(606)	(676)
Group’s share in loss	(303)	(338)

(17)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

11. PROPERTY, PLANT AND EQUIPMENT

For the three months period ended March 31, 2016 and 2015, the additions and disposals on property, plant and equipment and net book values are as follows:

				Net book value
	Additions	Transfers	Disposals	at March 31,
				2016
Land and Buildings	12.203	1.348	-	1.153.772
Machinery and Equipment	19.659	12.437	(235)	1.988.637
Vehicles	3.331	115	(895)	69.398
Furniture and Fixtures	294	1.287	-	39.769
Other Tangible Assets	66.379	2.432	(588)	811.837
Leasehold Improvements	-	-	-	9.142
Construction in Progress	37.123	(17.619)	-	247.140
	138.989	-	(1.718)	4.319.695
				Net book value
	Additions	Transfers	Disposals	at March 31,
				2015
Land and Buildings	10.398	8.718	(44)	843.912
Machinery and Equipment	40.034	8.740	(607)	1.535.072
Vehicles	2.079	8	(636)	63.427
Furniture and Fixtures	810	144	(326)	34.371
Other Tangible Assets	33.433	15.893	(1.583)	731.393
Leasehold Improvements	-	-	-	10.646
Construction in Progress	139.246	(33.503)	-	561.261
	226.000	-	(3.196)	3.780.082

Impairment Loss

As of March 31, 2016 the Group had provided impairment losses amounting to TL 1.656 (March 31, 2015 - TL 501) for property, plant and equipment that had greater carrying value than its estimated recoverable amount. This impairment had been provided for “Out of Use” tangible assets. As of March 31, 2016, TL 1.177 impairment losses provided at prior years were reversed (March 31, 2015 - none) (Note 19).

In accordance with the annual impairment test realized for intangible assets with indefinite useful life and goodwill, with discounted free cash methodology, it has been concluded that there is no impairment on the non-financial assets.

For the three months period ended March 31, 2016, there is no capitalized borrowing costs on construction in progress (March 31, 2015 - 3.931).

Finance Leases

Property leased by the Group includes coolers, vehicles, buildings, machinery and equipment.

As of March 31, 2016 net book value of assets under finance leases included in property, plant and equipment is amounting to TL 1.445 (December 31, 2015 - TL 1.488).

12. INTANGIBLE ASSETS

For the three months period ended March 31, 2016 and 2015, the additions on intangible assets and net book values are as follows:

	Additions	Disposals	Net book value at March 31, 2016
Rights	744	(158)	6.061
Water sources usage right	-	-	29.555
Bottlers and distribution agreements	-	-	1.087.923
	744	(158)	1.123.539

(18)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

12. INTANGIBLE ASSETS (continued)

	Additions	Net book value at March 31, 2015
Rights	781	26.489
Water sources usage right	-	9.643
Bottlers and distribution agreements	-	1.000.476
	781	1.036.608

There is no water sources usage right acquired through government incentive.

13. GOODWILL

As of March 31, 2016 and December 31, 2015 movements of goodwill are as follows:

	January 1, 2016	Currency Translation Difference	March 31, 2016
Cost	620.484	(15.480)	605.004
Accumulated depreciation / Impairment reserve	(13.863)	-	(13.863)
Net book value	606.621	(15.480)	591.141
	January 1, 2015	Currency Translation Difference	December 31, 2015
Cost	497.662	122.822	620.484
Accumulated depreciation / Impairment reserve	(13.863)	-	(13.863)
Net book value	483.799	122.822	606.621

14. GOVERNMENT INCENTIVES

As of March 31, 2016, Group used incentives for Bursa mineral water, Elazığ, Köyceğiz, Çorlu, Ankara, Mersin and İzmir production line investments with an amount of TL 126.617 (December 31, 2015 - TL 107.922) by generating future tax advantage of TL 23.658 (December 31, 2015 - TL 21.004). TL 274 of this tax advantage was recognized in the financial statements (As of March 31, 2015 tax advantage has not been calculated since the Company was in statutory loss).

15. PROVISIONS, CONTINGENT ASSETS and LIABILITIES

CCI and its Subsidiaries in Turkey

Litigations against the Group

CCI and subsidiaries in Turkey are involved on an ongoing basis in litigation arising in the ordinary course of business as of March 31, 2016 with an amount of TL 7.440 (December 31, 2015 - TL 7.545). As of March 31, 2016, no court decision has been granted yet. Group management does not expect any adverse consequences related with these litigations that would materially affect Group’s operation results or financial status or liquidity.

Guarantee Letters

As of March 31, 2016, the aggregate amount of letter of guarantees given are TL 407.688 (December 31, 2015 - TL 325.660).

Subsidiaries and joint ventures operating in foreign countries

Litigations against the Group

As of March 31, 2016 CCBPL has tax litigations. If the claims are resulted against CCBPL, the tax liability would be USD 14,0 million (December 31, 2015 - USD 14,0 million).

Group management does not expect any adverse consequences related with these litigations that would materially affect Group’s operation results or financial status.

(19)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

15. PROVISIONS, CONTINGENT ASSETS and LIABILITIES (continued)

Mortgages

As of March 31, 2016, the mortgages on buildings and lands of TCCBCJ and CCBPL amounts to TL 9.977 (December 31, 2015 - TL 10.238) and TL 72.243 (December 31, 2015 - TL 74.135) respectively, for the credit lines obtained.

Letter of Credit

As of March 31, 2016, CCBPL obtained letter of credits amounting to USD 1,5 million and EUR 1,0 million (December 31, 2015 - CCBPL USD 1,0 million and EUR 2,2 million).

Guarantee Letters

As of March 31, 2016, amount of letters of guarantee obtained from banks and given to suppliers and government authorities is TL 14.268 (December 31, 2015 - TL 14.811).

As of March 31, 2016, and December 31, 2015 total guarantees and pledges given by the Group are as follows:

	March 31, 2016
Total TL Equivalent	Original TL Amount Original USD in Thousands Original EUR in Thousands Original PKR in Thousands Other Foreign Currency TL Equivalent
A. Total guarantees and pledges given by the Company for its own corporation 497.813 B. Total guarantees and pledges given by the Company for its subsidiaries consolidated for using the full consolidation method 453.611 C. Total guarantees and pledges given by the Company for other third parties for its ordinary commercial activities - D. Other guarantees and pledges given - i. Total guarantees and pledges given by the Company for its parent company - ii. Total guarantees and pledges given by the Company for other group companies which are not covered in B and C clauses - iii. Total guarantees and pledges given by the Company for otherthird partieswhicharenot coveredinthe C clause -	407.688 181 204 2.667.000 16.714 - 37.574 84.902 1.845.905 24.778 - - - - - - - - - - - - - - - - - - - - - - - - -
Total guarantees and pledges 951.424	407.688 37.755 85.106 4.512.905 **41.492 **
Other guarantees and pledges given / Total equity (%) -	- - - - -
	December 31, 2015
Total TL Equivalent	Original TL Amount Original USD in Thousands Original EUR in Thousands Original PKR in Thousands Other Foreign Currency TL Equivalent
A. Total guarantees and pledges given by the Company for its own corporation 410.038 B. Total guarantees and pledges given by the Company for its subsidiaries consolidated for using the full consolidation method 488.129 C. Total guarantees and pledges given by the Company for other third parties for its ordinary commercial activities - D. Other guarantees and pledges given i. Total guarantees and pledges given by the Company for its parent company - ii. Total guarantees and pledges given by the Company for other group companies which are not covered in B and C clauses - iii. Total guarantees and pledges given by the Company for otherthird partieswhicharenot coveredinthe C clause -	325.660 - - 2.667.000 10.238 - 50.000 75.280 2.800.285 25.696 - - - - - - - - - - - - - - - - - - - -
Total guarantees and pledges 898.167	325.660 50.000 75.280 5.467.285 35.934
Other guarantees and pledges given / Total equity (%) -	- - - - -

Contingent liability related to letter of credits, guarantee letters and borrowings utilized under asset pledges are totally covered by the pledge amount in the related countries, and not separately disclosed under total guarantee and pledge position table.

(20)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

15. PROVISIONS, CONTINGENT ASSETS and LIABILITIES (continued)

Tax and Legal Matters

Legislation and regulations regarding taxation and foreign currency transactions in most of the territories in which the Group operates out of Turkey continue to evolve. The various legislation and regulations are not always clearly written and the interpretation related with the implementation of these regulations is subject to the opinions of the local, regional and national tax authorities, the Central Bank and Ministry of Finance. Tax declarations, together with other legal compliance areas are subject to review and investigation by a number of authorities, who are enabled by law to impose significant fines, penalties and interest charges. These facts create tax risks in the territories in which the Group operates substantially more so than typically found in countries with more developed tax systems.

As per the change in governing law in Pakistan, “Capacity Tax” was started to be applied as of July 9, 2013, replacing “Sales and Excise Tax”. CCBPL fulfilled all the obligations as per the new law and change in regulations.

As of May 2014, “Capacity Tax” application was cancelled by the constitutional court and the law has been reverted to “Sales and Excise Tax”. After this withdrawal, CCBPL fulfilled all the obligations again according to “Sales and Excise Tax” system.

After the withdrawal, Federal tax office in Pakistan requested USD 33,5 million additional tax payment from CCBPL, by arguing that “Sales and Excise Tax” should be applied retrospectively by considering the period before the cancellation of “Capacity Tax” application. Company Management objected and litigated this request, since withdrawal decisions of constitutional court could not be applied retrospectively in principle. In the opinion of Management, the outcome of the litigation will be favorable.

16. COMMITMENTS

Murabaha

CCBPL has signed murabaha facility agreements with Standard Chartered Bank and Habib Bank Limited (“Banks”). Based on these agreements, the Banks and CCBPL agree that they shall enter into a series of sugar and resin purchase transactions from time to time on the dates and in the amounts to be agreed between them subject to the terms of this agreement. As of March 31, 2016 CCBPL has USD 20,8 million sugar and resin purchase commitment from the Banks until the end of December 2016 and USD 22,1 and sugar and resin purchase commitment from the Banks until the end of February 2017 and expense accrual of USD 0,5 million (TL 1,5 million) payable for the profit share of the Bank was reflected in the financial statements as of March 31, 2016.

Operating Leases

CCI and CCSD have signed various operating lease agreements for vehicles.

TL 5.165 of rent expense was reflected for the three months period ended March 31, 2016 (March 31, 2015 - TL 3.787) in the consolidated income statement due to the non-cancellable operating lease agreement for vehicles.

As of March 31, 2016 and December 31, 2015, future minimum lease payments under non-cancellable operating lease agreements are as follows:

		March 31, 2016	December31,2015
Less than 1 year		574	1.849
Next 1-5 years		19.449	21.477
17.	OTHER CURRENT / NON-CURRENT ASSETS AND LIABILITIES
a)	Other current assets
		March 31, 2016	December31,2015
VAT	receivables	220.814	228.197
Other		2.649	4.051
		223.463	232.248

(21)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

17. OTHER CURRENT / NON-CURRENT ASSETS AND LIABILITIES (continued)

b) Other current liabilities

b) Other current liabilities
	March 31, 2016 December31,2015
Advance received Buying option of share from non-controlling interest Other	10.470 12.660 6.687 6.862 16.631 10.559
	33.788 30.081

The obligation of TL 6.687 results from the buying option carried, for the purchase of 12,5% of Turkmenistan CC shares from Day Investment Ltd., with a consideration of USD 2.360 thousand. USD amount is converted with the official USD purchase rate announced by Central Bank of Republic of Turkey and resulting TL amount is reflected under other current liabilities. The Share Purchase Agreement was signed with Day Investment Ltd. in 2011 however, there has not yet been any share transfer carried out according to local Turkmenistan regulations and existing shareholder agreement requirements, and accordingly, no payment has been made for the of share purchase.

c) Other non-current liabilities

According to the put option signed with European Refreshments (“ER”), which became effective after the completion of Al Waha acquisition and exercisable between December 31, 2016 and 2021, ER has an option to sell (and CCI will have an obligation to buy) its remaining 19,97% participatory shares in Waha B.V. In accordance with TAS 27 “Consolidated and Separate Financial Statements”, this obligation is recorded as put option liability in the Group’s consolidated financial statements. Based on both the contract and the assumption that ER will exercise the option at the end of 2016, fair value of the put option liability is calculated using discounted cash flow method as TL 112.795 and the amount is recorded under “other non-current liabilities” account (December 31, 2015 - TL 115.748).

18. EQUITY

Share Capital

	March 31,	December 31,
	2016	2015
Common shares 1 Kr par value
Authorized and issued (units)	25.437.078.200	25.437.078.200

Reserves

As of March 31, 2016 and December 31, 2015 breakdown of the equity of the Company in its tax books is as follows.

		March 31, 2016			December31,2015
		Inflation			Inflation
	Historical	Restatement	Restated	Historical	Restatement	Restated
	Amount	Differences	Amount	Amount	Differences	Amount
Share Capital	254.371	(8.559)	245.812	254.371	(8.559)	245.812
Restricted reserves allocated from net profit	141.586	13.396	154.982	141.586	13.396	154.982
Extraordinary Reserves	527.518	9.551	537.069	527.518	9.551	537.069

Dividends

In the Ordinary General Assembly meeting dated April 13, 2016, it’s approved to distribute cash dividends starting from May 27, 2016 with a total amount of TL 30.016 gross dividends (TL 0,1003 (full) will be paid per 100 shares, representing TL 1 nominal value), of that TL 19.221 was remained after legal liabilities were deducted from 2015 net profit and the amount of TL 10.795 from extraordinary reserves for the year 2012. The remainder of 2015 net profit to be added to the extraordinary reserves. In year 2015 the Group paid dividend related with the fiscal year of 2014 to its shareholders with an amount of TL 100.222 (TL 0,394 (full) was paid per 100 shares, representing TL 1 nominal value).

There is not any privilege granted to shareholders related to dividend payments.

(22)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

19. OTHER INCOME / EXPENSE

a) Other operating income/expense

	March 31, 2016	March 31, 2015
Other income
Gain on sale of scrap materials	2.471	3.048
Impairment reversal in property, plant and equipment (Note 20)	1.177	-
Insurance compensation income	189	71
Foreign exchange gains	22.496	30.701
Other income	2.613	1.492
	28.946	35.312
Other expense
Provision for the impairment of fixed assets (Note 20)	(1.656)	(501)
Donations	(191)	(117)
Foreign exchange loss	(25.174)	(32.666)
Other expenses	(2.241)	(3.758)
	(29.262)	(37.042)

b) As of March 31, 2016 and 2015 gain from investing activities comprised of TL 517 loss on disposal of property, plant and equipment and 649 gain on disposal of property, plant and equipment respectively .

20. FINANCIAL INCOME

	March 31, 2016	March 31,2015
Interest income	11.081	10.707
Foreign exchange gain	82.721	114.619
Gain on derivative transactions	420	2
	94.222	125.328

21. FINANCIAL EXPENSES

	March 31, 2016	March31,2015
Interest expense	(39.873)	(42.804)
Foreign exchange loss	(64.862)	(269.205)
Loss on derivative transactions	(9.679)	(10)
	(114.414)	(312.019)

As of March 31, 2016 and 2015 foreign exchange gain / (loss) from foreign currency denominated borrowings are as follows:

	March 31, 2016	March 31,2015
Foreign exchange gain / (loss) from foreign currency denominated borrowings,net	43.576	(256.302)

(23)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

22. INCOME TAXES, DEFERRED TAX ASSETS AND LIABILITIES

General information

The Group is subject to taxation in accordance with the tax regulations and the legislation effective in the countries in which the Group companies operate. In Turkey, the tax legislation does not permit a parent company and its subsidiaries to file a consolidated tax return. Therefore, provision for taxes, as reflected in the consolidated financial statements, has been calculated on a separate-entity basis.

In Turkey, corporate tax rate is 20% (December 31, 2015 - 20%). Corporate tax returns are required to be filed by the twenty-fifth day of the fourth month following the balance sheet date and taxes must be paid in full by the end of the fourth month. The tax legislation provides for a provisional tax of 20% (2015 - 20%) to be calculated and paid based on earnings generated for each quarter. The amounts thus calculated and paid are offset against the final corporate tax liability for the year. Corporate tax losses can be carried forward for a maximum period of five years following the year in which the losses were incurred. The tax authorities can inspect tax returns and the related accounting records for a retrospective maximum period of five years.

Different corporate tax rates of foreign subsidiaries are as follows:

	March 31, 2016	December31,2015
Kazakhstan	%20	20%
Azerbaijan	%20	20%
Kyrgyzstan	%10	10%
Turkmenistan	%8	8%
Tajikistan	%15	15%
Jordan	%14	14%
Iraq	%15	15%
Pakistan	%33	33%

Because of the international nature of the Group’s activities and the fact that the Group transacts more of its business in U.S. Dollars than in any other currency, the functional currency of the Group’s foreign subsidiaries is U.S. Dollars. except Pakistan.

For the consolidated financial statements, subsidiaries financial statements have been translated from U.S. Dollars into TL and the “translation differences” arising from such translation have been recorded in equity, under Currency Translation Adjustment. Since it’s not planned to sell any subsidiary share, these translation differences will not be reversed in the foreseeable future and not subject to deferred tax calculation in accordance with TAS 12, Income Taxes.

The list of temporary differences and the resulting deferred tax liabilities, as of March 31, 2016 and December 31, 2015 using the prevailing effective statutory tax rate is as follows:

	March 31, 2016	March 31, 2016	December	31,2015
	Cumulative	Deferred	Cumulative	Deferred
	Temporary	Tax Assets/	Temporary	Tax Assets/
	Difference	(Liabilities)	Difference	(Liabilities)
Tangible and intangible assets	(1.773.715)	(448.643)	(1.809.344)	(458.427)
Borrowings	(13.037)	(2.607)	(22.081)	(4.416)
Employee termination, other employee benefits and other payable accruals	76.134	16.664	65.719	13.029
Unused investment incentive (Not 14)	126.617	23.658	107.922	21.004
Tax loss carried forward	372.249	109.904	382.892	118.603
Trade receivables, payables and other	51.251	10.160	86.542	17.068
Derivative financial instruments	641	129	10.683	2.137
Inventory	58.742	11.950	55.507	11.471
	(1.101.118)	(278.785)	(1.122.160)	(279.531)
Deferred tax asset		172.467		183.312
Deferred tax liability		(451.252)		(462.843)
Deferred tax liability,net		(278.785)		(279.531)

(24)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

22. INCOME TAXES, DEFERRED TAX ASSETS AND LIABILITIES (continued)

Carried forward tax losses of Pakistan which were formed by the depreciation expenses according to local tax regulations are subject to deferred tax. In accordance with the local tax regulations in Pakistan, these tax losses has an exception of normal time limit (6 years) and can be carried forward with an indefinite life.

As of March 31, 2016 and 2015, the movement of net deferred tax liability is as follows:

	March 31, 2016	March31,2015
Balance at January 1,	279.531	212.317
Deferred tax expense / (income)	5.771	(7.931)
Tax expense recognized in comprehensive income	129	733
Currency translation adjustment	(6.646)	23.026
	278.785	228.145

23. EARNINGS / (LOSSES) PER SHARE

Basic earnings / (losses) per share is calculated by dividing net income / (loss) for the period by the weighted average number of ordinary shares outstanding during the related period. The company has no diluted instruments. As of March 31, 2016 and 2015 earnings / (losses) per share is as follows:

	March 31, 2016	March 31, 2015
Net Income for the period	29.427	(90.657)
Weighted average number of ordinary shares	25.437.078.200	25.437.078.200
Earnings Per Share(Full TL)	0,0012	(0,0036)

(25)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

24. RELATED PARTY BALANCES AND TRANSACTIONS

The Group has various transactions with related parties in normal course of the business. The most significant transactions with related parties are as follows:

		March	31, 2016
	Sales to related parties and other revenues	Purchases from related parties and other expenses	Amounts owed by related parties	Amounts to related	owed parties
				Short	Long
				Term	Term
Related Parties and Shareholders
Anadolu Group Companies (1)	32.101	6.213	42.484	2.665	-
Beverage Partners Worldwide (2)	-	-	-	-	-
The Coca-Cola Company (1)	17.915	317.818	17.633	133.224	19.848
Özgörkey Holding Group Companies (1)	168	4.149	-	2.431	-
Efes Karaganda Brewery J.S.C.(1)	-	82	-	45	-
Syrian Soft Drink Sales and Distribution L.L.C.(4)	-	-	850	-	-
Doğadan (2)	3.549	35.803	-	29.888	-
Day Trade (2)	-	-	2440	2.930	-
National Beverage Co. (3)	394	2.359	-	-	-
Total	54.127	366.424	63.407	171.183	19.848

	March	31, 2015	December	31, 2015
	Sales to related parties and other revenues	Purchases from related parties and other expenses	Amounts owed by related parties	Amounts to related	owed parties
				Short	Long
				Term	Term
Related Parties and Shareholders
Anadolu Group Companies (1)	2.286	6.586	38.929	1.827	-
Beverage Partners Worldwide (2)	-	-	-	-	-
The Coca-Cola Company (1)	15.116	298.534	68.171	123.279	20.092
Özgörkey Holding Group Companies (1)	303	4.080	-	1.382	-
Efes Karaganda Brewery J.S.C.(1)	-	248	-	26	-
Syrian Soft Drink Sales and Distribution L.L.C.(4)	477	-	76	-	-
Doğadan (2)	1.528	26.670	-	29.401	-
Day Trade (2)	-	-	2.505	303	-
National Beverage Co. (3)	550	2.340	-	-	-
Total	20.260	338.458	109.681	156.218	20.092

(1) Shareholder of the Company, subsidiaries and joint ventures of the shareholder

(2) Related parties of the shareholder

(3) Other shareholders of the joint ventures and subsidiaries

(4) Investment in associate consolidated under equity method of accounting

As of March 31, 2016, Group has deposits in Alternatifbank A.Ş. (subsidiary of the shareholder) amounting to TL 211.807 (December 31, 2015 - TL 620).

As of March 31, 2016 and 2015, purchases from related parties and significant portion of other expenses consist of services obtained, fixed asset, raw material purchases and toll production.

As of March 31, 2016 and 2015, sales to related parties and other revenues consist of sale of finished goods and support charges of promotional expenses reflected to related parties.

As of March 31, 2016 and 2015, remuneration received by the executive members of the Board of Directors, Chief Executive Officer, Chief Operating Officers and Directors of the Company are as follows:

	March 31, 2016	March 31, 2016	March31,2015	March31,2015
	Board of	Executive	Board of	Executive
	Directors	Directors	Directors	Directors
Short-term employee benefits	85	3.749	80	3.350
Other long-term benefits	-	600	-	583
	85	4.349	80	3.933
Numberoftop executives	4	13	4	12

(26)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

25. NATURE AND LEVEL OF RISKS ARISING FROM FINANCIAL INSTRUMENTS

The Group’s principal financial instruments are comprised of bank borrowings, bond issues, cash and short-term deposits. The main purpose of these financial instruments is to raise financing for the Group’s operations. The Group has various other financial instruments such as trade debtors and trade creditors, which arise directly from its operations.

The main risks arising from the Group’s financial instruments are interest rate risk, liquidity risk, foreign currency risk, credit risk and commodity price risk. The Group management reviews and agrees policies for managing each of these risks which are summarized below. The Group also monitors the market price risk arising from all financial instruments.

(a) Capital Management

The primary objective of the Group’s capital management is to ensure that it maintains a strong credit rating and healthy capital ratio in order to support its business and maximize shareholder value.

The Group manages its capital structure and makes adjustments to it in light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders or return capital to shareholders and may decide on issue of new shares or sell assets to decrease net financial debt.

As of March 31, 2016 and December 31, 2015 debt to equity ratio, obtained by dividing the total net debt to share capital is as follows:

Net debt is the financial borrowings less cash and cash equivalents and short-term financial assets.

	March 31, 2016	December31,2015
Financial borrowings	3.261.591	3.373.943
Less: Cash and cash equivalents and short-term financial assets	(865.435)	(1.002.362)
Net debt	2.396.156	2.371.581
Total share capital	254.371	254.371
Net debt / Total equity ratio	9,42	9,32

(b) Interest Rate Risk

The Group is exposed to interest rate risk through the impact of rate changes on interest bearing assets and liabilities. The Group manages interest rate risk by balancing the interest rate of assets and liabilities or derivative financial instruments.

Certain parts of the interest rates related to borrowings are based on market interest rates; therefore the Group is exposed to interest rate fluctuations on domestic and international markets. The Group’s exposure to market risk for changes in interest rates relates primarily to the Group’s debt obligations.

As of March 31, 2016, if variable interest rate on the Group’s borrowings would have been 100 basis points higher / lower with all other variables held constant, then profit / (loss) before tax and non-controlling interest for June 30, 2016, which is the following reporting period would be:

		Effect on Profit / (Loss) Before Tax	Effect on Profit / (Loss) Before Tax
		andNon-ControllingInterest
		March 31, 2016	March31,2015
Increase / decrease of	1% interest in USD denominated borrowing interest rate	505	1.177
Increase / decrease of	1% interest in Euro denominated borrowing interest rate	1.293	-
Increase / decrease of	1% interest in PKR denominated borrowing interest rate	256	897
Total		2.054	2.074

(27)

(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

25. NATURE AND LEVEL OF RISKS ARISING FROM FINANCIAL INSTRUMENTS (continued)

As of March 31, 2016 and 2015, the analysis of financial assets of the Group exposed to interest risk as follows:

Interest Rate Risk	March 31, 2016	March 31, 2015
Fixed Interest Rate Financial Instruments
Financial assets at fair value through profit or loss	722.068	528.120
Financial Liabilities	2.343.291	2.151.235
Floating Interest Rate Financial Instruments
Financial Liabilities	918.300	831.106

(c) Foreign Currency Risk

The Group is exposed to exchange rate fluctuations due to the nature of its business. This risk occurs due to purchases, sales, demand / time deposits and bank borrowings of the Group, which are denominated in currencies other than the functional currency. The Group manages its foreign currency risk by balancing the amount of foreign currency denominated assets and liabilities.

urrency denominated assets and liabilities.
	March 31, 2016 March31,2015
Total export Total import	3.209 3.159 308.788 296.475

Foreign Currency Position

As of March 31, 2016 and December 31, 2015, the foreign currency position (except functional currency) of the Group and its subsidiaries is as follows:

nd its subsidiaries is as follows:
			**Foreign Currency Position **		Table
			March 31, 2016
						Other Foreign
	Total TL		TL		TL	Currency TL
	Equivalent	**USD **	Equivalent	Euro	Equivalent	Equivalent
1. Trade Receivables and Due from Related Parties	52.037	849	2.407	-	-	49.630
2a. Monetary Financial Assets (Cash and cash
equivalents included)	604.526	201.102	569.803	1.419	4.553	30.170
2b. Non - monetary Financial Assets	-	-	-	-	-	-
3. Other Current Assets and Receivables	64.239	167	472	169	537	63.230
4. Current Assets (1+2+3)	720.802	202.118	572.682	1.588	5.090	143.030
5. Trade Receivables and Due from Related Parties	-	-	-	-	-	-
6a. Monetary Financial Assets	-	-	-	-	-	-
6b. Non - monetary Financial Assets	-	-	-	-	-	-
7. Other	7.279	(328)	(932)	1.334	4.278	3.933
8. Non - Current Assets (5+6+7)	7.279	(328)	(932)	1.334	4.278	3.933
9. Total Assets (4+8)	728.081	201.790	571.750	2.922	9.368	146.963
10. Trade Payables and Due to Related Parties	103.806	12.999	36.829	6.314	20.253	46.724
11. Short - term Borrowings and Current Portion of Long -
term Borrowings	394.022	35.464	100.483	91.451	293.411	128
12a. Monetary Other Liabilities	45.572	2.422	6.862	27	88	38.622
12b. Non - monetary Other Liabilities	2.232	1	3	-	-	2.229
13. Current Liabilities (10+11+12)	545.632	50.886	144.177	97.792	313.752	87.703
14. Trade Payables and Due to Related Parties	-	-	-	-	-	-
15. Long - Term Borrowings	2.197.123	651.891	1.847.068	101.321	325.277	24.778
16 a. Monetary Other Liabilities	116.038	40.954	116.038	-	-	-
16 b. Non - monetary Other Liabilities	-	-	-	-	-	-
17. Non - Current Liabilities (14+15+16)	2.313.161	692.845	1.963.106	101.321	325.277	24.778
18. Total Liabilities (13+17)	2.858.793	743.731	2.107.283	199.113	639.029	112.481
19. Off Balance Sheet Derivative Items’ Net Asset /
(Liability) Position (19a-19b)	-	-	-	-	-	-
19a. Total Hedged Assets	-	-	-	-	-	-
19b. Total Hedged Liabilities	-	-	-	-	-	-
20. Net Foreign Currency Asset / (Liability) Position
(9-18+19)	(2.130.712)	(541.941)	(1.535.533)	(196.191)	(629.661)	34.482
21. Monetary Items Net Foreign Currency Asset /
(Liability) Position (TFRS 7.B23) (=1+2a+5+6a-10-11-
12a-14-15-16a)	(2.199.998)	(541.779)	(1.535.070)	(197.694)	(634.476)	(30.452)
22. Total Fair Value of Financial Instruments Used to
Manage the Foreign Currency Position	-	-	-	-	-	-

As of the reporting date, intercompany principal loan receivables in amount of USD 190,9 million is netted on foreign currency position and foreign currency position sensitivity analysis (as of December 31, 2015 and March 31, 2015, USD 181,9 million and USD 253,1 million respectively). These receivables are due from the subsidiaries of the Company, and were provided to finance their ongoing investment activities and working capital requirements.

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(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

25. NATURE AND LEVEL OF RISKS ARISING FROM FINANCIAL INSTRUMENTS (continued)

			ForeignCurrencyPosition Table	ForeignCurrencyPosition Table	ForeignCurrencyPosition Table
			December	31,2015
						Other Foreign
	Total TL		TL		TL	Currency TL
	Equivalent	**USD **	Equivalent	Euro	Equivalent	Equivalent
1. Trade Receivables and Due from Related Parties	45.835	850	2.471	-	-	43.364
2a. Monetary Financial Assets (Cash and cash
equivalents included)	554.925	179.860	522.962	1.862	5.917	26.046
2b. Non - monetary Financial Assets	-	-	-	-	-	-
3. Other Current Assets and Receivables	61.846	156	455	595	1.893	59.498
4. Current Assets (1+2+3)	662.606	180.866	525.888	2.457	7.810	128.908
5. Trade Receivables and Due from Related Parties	-	-	-	-	-	-
6a. Monetary Financial Assets	-	-	-	-	-	-
6b. Non - monetary Financial Assets	-	-	-	-	-	-
7. Other	1.391	24	68	318	1.012	311
8. Non - Current Assets (5+6+7)	1.391	24	68	318	1.012	311
9. Total Assets (4+8)	663.997	180.890	525.956	2.775	8.822	129.219
10. Trade Payables and Due to Related Parties	85.886	1.490	4.332	8.546	27.175	54.379
11. Short - term Borrowings and Current Portion of Long -
term Borrowings	351.685	45.906	133.476	68.628	218.078	131
12a. Monetary Other Liabilities	41.099	2.359	6.862	-	-	34.237
12b. Non - monetary Other Liabilities	-	-	-	-	-	-
13. Current Liabilities (10+11+12)	478.670	49.755	144.670	77.174	245.253	88.747
14. Trade Payables and Due to Related Parties	-	-	-	-	-	-
15. Long - Term Borrowings	2.282.341	660.548	1.920.610	105.656	336.037	25.694
16 a. Monetary Other Liabilities	116.038	39.909	116.038	-	-	-
16 b. Non - monetary Other Liabilities	-	-	-	-	-	-
17. Non - Current Liabilities (14+15+16)	2.398.379	700.457	2.036.648	105.656	336.037	25.694
18. Total Liabilities (13+17)	2.877.049	750.212	2.181.318	182.830	581.290	114.441
19. Off Balance Sheet Derivative Items’ Net Asset /
(Liability) Position (19a-19b)	101.766	35.000	101.766	-	-	-
19a. Total Hedged Assets	101.766	35.000	101.766	-	-	-
19b. Total Hedged Liabilities	-	-	-	-	-	-
20. Net Foreign Currency Asset / (Liability) Position
(9-18+19)	(2.111.286)	(534.322)	(1.553.596)	(180.055)	(572.468)	14.778
21. Monetary Items Net Foreign Currency Asset /
(Liability) Position (TFRS 7.B23) (=1+2a+5+6a-10-11-
12a-14-15-16a)	(2.276.289)	(569.502)	(1.655.885)	(180.968)	(575.373)	(45.031)
22. Total Fair Value of Financial Instruments Used to
Manage the Foreign Currency Position	(3.305)	(1.137)	(3.305)	-	-	-

The following table demonstrates the sensitivity of the Group’s profit before tax to a reasonably possible change in the USD, Euro and other foreign currency denominated exchange rates against TL by 10%, with all other variables held constant.

eld constant.
		Foreign Currency Position Sensitivity Analysis
	**March **		31, 2016	March 31, 2015
	Income /(Loss)		Income /(Loss)	Income / (Loss)	Income / (Loss)
	Increase of the		Decrease of the	Increase of the	Decrease of the
	foreign currency		foreign currency	foreign currency	foreign currency
Increase / decrease in the USD against TL by 10%:
1- USD denominated net asset / (liability)	(153.553)		153.553	(169.109)	169.109
2- USD denominated hedging instruments(-)	-		-	4.573	(4.573)
3- Net effect in USD (1+2)	(153.553)		153.553	(164.536)	164.536
Increase / decrease in the Euro against TL by 10%:
4- Euro denominated net asset / (liability)	(62.966)		62.966	(1.466)	1.466
5- Euro denominated hedging instruments(-)	-		-	-	-
6- Net effect in Euro (4+5)	(62.966)		62.966	(1.466)	1.466
Increase / decrease in the other foreign currencies
against TL by 10%:
7- Other foreign currency denominated
net asset / (liability)	3.448		(3.448)	3.669	(3.669)
8- Other foreign currency hedging instruments(-)	-		-	-	-
9- Net effect in other foreign currency (7+8)	3.448		(3.448)	3.669	(3.669)
TOTAL(3+6+9)	(213.071)		213.071	(162.333)	162.333

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(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi

Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

25. NATURE AND LEVEL OF RISKS ARISING FROM FINANCIAL INSTRUMENTS (continued)

(d) Credit Risk

Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. Financial instruments that potentially subject the Group to significant concentration of credit risk consist principally of cash and cash equivalents and trade receivables. Maximum credit risk on the Group is limited to the amounts disclosed on the financial statements.

The Group maintains cash and cash equivalents with various financial institutions. It is the Group’s policy to limit exposure to any one institution and revalue the credibility of the related financial institutions continuously.

The credit risk associated with trade receivables is partially limited due to a large customer base and due to management’s limitation on the extension of credit to customers. The Group generally requires collateral to extend credit to its customers excluding its distributors.

(e) Liquidity Risk

Liquidity risk is the risk that an entity will be unable to meet its net funding requirements. The risk is mitigated by matching the cash in and out flow volume supported by committed lending limits from qualified credit institutions, bond issues, cash and short term deposits.

The maturity breakdown of financial assets and liabilities has been indicated by considering the period from the balance sheet date to maturity date. Those financial assets and liabilities which have no maturities have been classified under “1 to 5 years”.

(f) Commodity Price Risk

The Company may be affected by the volatility of certain commodities such as sugar, aluminum and resin. As its operating activities require the ongoing purchase of these commodities, the Company’s management has a risk management strategy regarding commodity price risk and its mitigation.

Based on a 12-month anticipated purchase of can, the Company hedges the purchase price using commodity (aluminum) swap contracts. For the purchases of can exposed to foreign currency risk, the Company has forward transactions (Note 6).

26. FINANCIAL INSTRUMENTS

Fair Values

Fair value is the amount at which a financial instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation, and best evidenced by a quoted market price, if one exists.

Foreign currency-denominated financial assets and liabilities are revalued at the exchange rates prevailing at the balance sheet dates.

The following methods and assumptions were used in the estimation of the fair value of the Group’s financial instrument:

Financial Assets – The fair values of certain financial assets carried at cost, including cash and cash equivalents and held to maturity investments plus the respective accrued interest are considered to approximate their respective carrying values due to their short-term nature and negligible credit losses. The carrying values of trade receivables along with the related allowances for uncollectibility are estimated to be their fair values.

Financial Liabilities – The fair values of trade payables and other monetary liabilities are estimated to approximate carrying value due to their short-term nature. The fair values of bank borrowings are considered to approximate their respective carrying values, since the initial rates applied to bank borrowings are updated periodically by the lender to reflect active market price quotations. The carrying values of trade payable are estimated to be their fair values due to their short term nature.

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(Convenience Translation of Financial Statements and Footnotes Originally Issued in Turkish)

Coca-Cola İçecek Anonim Şirketi Notes to Condensed Consolidated Financial Statements as at March 31, 2016 (Currency - Thousands of Turkish Lira unless otherwise indicated (TL))

26. FINANCIAL INSTRUMENTS (continued)

Fair value hierarchy table

The Group classifies the fair value measurement of each class of financial instruments according to the source, using the three-level hierarchy, as follows:

Level 1: Market price valuation techniques for the determined financial instruments traded in markets Level 2: Other valuation techniques includes direct or indirect observable inputs Level 3: Valuation techniques does not contains observable market inputs

March 31, 2016	Level 1		Level 2	Level 3
a) Assets presented at fair value
Derivative financial instruments		-	-	-
Total assets		-	-	-
b) Liabilities presented at fair value
Derivative financial instruments		-	5.749	-
Buying option of share from non-controlling interest		-	-	112.795
Total liabilities		-	5.749	112.795
December 31, 2015	Level 1		Level 2	Level 3
a) Assets presented at fair value
Derivative financial instruments	-		260	-
Total assets	-		260	-
b) Liabilities presented at fair value
Derivative financial instruments	-		11.377	-
Buying option of share from non-controlling interest			-	115.748
	-
Total liabilities	-		11.377	115.748

Derivative Financial Instruments

As of March 31, 2016 the Company has 9 aluminum swap transactions with a total nominal amount of TL 42.006 for 8.408 tones. The total of these aluminum swap contracts are designated as hedging instruments as of January 13, 2015, May 29, 2015, June 25, 2015 and July 27, 2015 in cash flow hedges related to forecasted cash flow, for the high probability purchases of production material exposed to commodity price risk (Note 6) (December 31, 2015 - 8 aluminum swap transactions with a total nominal amount of TL 54.283 for 10.580 tones).

As of March 31, 2016 the Company has FX forward transactions with a total nominal amount of TL 79.087, for 3 forward purchase contracts amounting to USD 28 million, considering currency diversity of the cash portfolio to keep US American Dollar against Turkish Lira volatility impacts at minimum. These FX forward contracts are executed as of October 6, 2015, October 9, 2015 and November 12, 2015 (As of December 31, 2015, total nominal amount of TL 101.766, for 3 forward purchase contracts amounting to USD 35 million).

27. SUBSEQUENT EVENTS

None.

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