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COCA-COLA İÇECEK A.Ş.

Quarterly Report May 22, 2024

5900_rns_2024-05-22_5dded2df-1f88-42db-9d62-44cb51bc4ffc.pdf

Quarterly Report

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COCA-COLA İÇECEK ANONİM ŞİRKETİ AND ITS SUBSIDIARIES

CONVENIENCE TRANSLATION INTO ENGLISH OF CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND NOTES FOR THE INTERIM PERIOD 1 JANUARY - 31 MARCH 2024 (ORIGINALLY ISSUED IN TURKISH)

Coca-Cola İçecek Anonim Şirketi

Interim Condensed Consolidated Financial Statements as of March 31, 2024

Pages

Interim Condensed Consolidated Statement of Financial Position 1-2
Interim Condensed Consolidated Statement of Profit or Loss 3
Interim Condensed Consolidated Statement of Other Comprehensive Income 4
Interim Condensed Consolidated Statement of Change in Equity 5
Interim Condensed Consolidated Statement of Cash Flows 6
Notes to Interim Condensed Consolidated Financial Statements 7-42

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Interim Condensed Consolidated Statement of Financial Position as of March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

@ @ Unaudited Audited
ASSETS Notes March 31, 2024 December 31, 2023
@ @ @ @
Cash and Cash Equivalents 5 18.781.396 25.031.776
Financial Investments 6 484.077 432.377
Trade Receivables @ 17.382.850 10.142.314
- Trade receivables due from related parties 24 1.143.117 1.368.617
- Trade receivables due from third parties @ 16.239.733 8.773.697
Other Receivables 9 160.209 138.696
- Other receivables due from third parties @ 160.209 138.696
Derivative Financial Instruments 7-26 194.163 162.736
Inventories @ 14.270.621 14.938.203
Prepaid Expenses 10 2.815.497 2.147.665
Current Income Tax Assets @ 703.729 730.498
Other Current Assets 18 3.041.284 1.799.214
- Other current assets from third parties @ 3.041.284 1.799.214
@
Total Current Assets
@ @
57.833.826
@
55.523.479
@
Other Receivables
@
@
@
155.482
@
155.232
- Other receivables due from third parties @ 155.482 155.232
Property, Plant and Equipment 12 43.890.797 40.542.255
Intangible Assets @ 26.924.948 27.552.346
- Goodwill 14 5.417.437 5.344.745
- Other intangible assets 13 21.507.511 22.207.601
Right of Use Asset 12 555.082 623.847
Prepaid Expenses 10 1.145.933 1.400.584
Deferred Tax Assets 22 1.070.761 668.150
Derivative Financial Instruments 7-26 44.445 38.474
Other Non Current Assetsther @ 15.368 247.816
Total Non-Current Assets 73.802.816 71.228.704
@
Total Assets
@
@
131.636.642 126.752.183

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Interim Condensed Consolidated Statement of Financial Position as of March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

@ @ Unaudited Audited
LIABILITIES Notes March 31, 2024 December 31, 2023
@ @ @ @
Short-term Borrowings 8 9.569.226 9.818.619
- Bank borrowings @ 9.569.226 9.818.619
Current Portion of Long-term Borrowings 8 11.098.710 10.965.768
- Bank borrowings @ 10.878.265 10.740.315
- Lease liabilities @ 220.445 225.453
Trade Payables @ 24.016.504 21.397.584
- Trade payables due to related parties 24 10.938.672 8.849.526
- Trade payables due to third parties 13.077.832 12.548.058
Payables Related to Employee Benefits 641.018 415.688
Other Payables 6.289.495 2.869.375
- Other payables due to related parties 24 253.440 265.901
- Other payables due to third parties 6.036.055 2.603.474
Derivative Financial Instruments 7-26 222.767 320.326
Deferred Income 10 234.350 236.314
Provision for Corporate Tax @ 1.298.180 470.589
Current Provisions @ 1.387.215 1.111.979
- Current provisions for employee benefits 370.327 301.854
- Other short term provisions @ 1.016.888 810.125
Other Current Liabilities
@
18
@
151.081 154.421
Total Current Liabilities @ 54.908.546 47.760.663
@ @
Long-term Borrowings 8 20.398.238 21.834.839
- Bank borrowings @ 19.926.416 21.300.507
- Lease liabilities @ 471.822 534.332
Trade Payables @ 3.474 5.746
- Trade payables due to third parties @ 3.474 5.746
Non-Current Provisions @ 786.686 842.012
- Non-current provisions for employee benefits 786.686 842.012
Deferred Tax Liability 22 4.409.316 4.527.758
Derivative Financial Instruments 7-26 5.946 3.417
Non-Current Deferred Income 10 37.136 50.981
Total Non-Current Liabilities @ 25.640.796 27.264.753
@
Equity of the Parent
@
@
44.424.792 45.204.722
Share Capital 19 254.371 254.371
Share Capital Adjustment Differences 19 3.710.396 3.710.396
Share Premium @ 3.131.953 3.131.953
Other comprehensive income items not to be reclassified to @
profit or loss (439.579) (444.545)
- Actuarial gains / losses @ (439.579) (444.545)
Other comprehensive income items to be reclassified to
profit or loss
@ (12.655.816) (9.155.046)
- Currency translation adjustment @ 14.116.028 16.216.992
- Hedge reserve gain / (losses) @ (26.771.844) (25.372.038)
- Cash flow hedge reserve gain / (losses) @ (1.492.499) (1.529.333)
- Net investment hedge reserve gain / (losses) @ (25.279.345) (23.842.705)
Restricted Reserves Allocated from Net Profit 19 2.348.707 2.348.707
Accumulated Profit / Loss @ 45.358.886 21.678.923
Net Income / (Loss) for the period @ 2.715.874 23.679.963
Non-Controlling Interest 6.662.508 6.522.045
Non-
Total Equity
@
@
51.087.300 51.726.767
Total @
Total Liabilities @ 131.636.642 126.752.183

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Interim Condensed Consolidated Statement of Profit or Loss for the three months period ended March 31, 2024 (Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

@ @ Unaudited Unaudited
@ January 1 - January 1 -
Notes March 31, 2024 March 31, 2023
@ @ @ @
Net Revenue 27.229.898 26.450.424
Cost of Sales (-) (18.180.405) (18.313.474)
Gross Profit / (Loss) @
@
9.049.493 8.136.950
@ @
General and Administration Expenses (-) (1.499.281) (1.095.029)
Marketing, Selling and Distribution Expenses (-) (4.389.093) (3.924.053)
Other Operating Income 20 663.505 482.516
Other Operating Expense (-) 20 (612.931) (446.293)
@
Profit / (Loss) From Operations
@
@
3.211.693 3.154.091
@ @
Gain from Investing Activities 20 4.455 42.473
Loss from Investing Activities (-) 20 (20.856) (17.117)
Gain / (Loss) from Joint Ventures 11 (2.161) (15.899)
@
Profit / (Loss) Before Financial Income / (Expense)
@
@
3.193.131 3.163.548
@ @
Financial Income / (Expense) 21 (1.145.034) (767.884)
Financial Income 1.266.541 1.904.224
Financial Expenses (-) (2.411.575) (2.672.108)
Monetary Gain / (Loss) 2.536.936 2.282.556
@
Profit / (Loss) Before Tax from Continuing Operations
@
@
4.585.033 4.678.220
@ @
Tax Expense from Continuing Operations 22 (1.875.246) (1.431.395)
Deferred Tax Income / Expense (-) (146.078) 17.665
Current Period Tax Expense (-) @ (1.729.168) (1.449.060)
@
Net Profit / (Loss) from Continuing Operations
@
@
2.709.787 3.246.825
@ @
Attributable to: @
Non-controlling interest @ (6.087) 66.512
Equity holders of the parent 23 2.715.874 3.180.313
@
Net Profit / (Loss)
@
@
2.709.787 3.246.825
@ @
Equity Holders Earnings Per Share (full TL) 23 0,106768 0,125027

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Interim Condensed Consolidated Statement of Other Comprehensive Income for the three months period ended March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

@ Unaudited Unaudited
@ January 1 - January 1 -
Notes March 31, 2024 March 31, 2023
@ @ @
Profit / (loss) for the period 2.709.787 3.246.825
@
Actuarial Gain / (Losses) 6.622 -
Deferred Tax Effect 22 (1.656) -
@
Other comprehensive income items, not to be reclassified to profit
4.966 -
or loss
@
Hedge reserve gain / (losses) (1.878.129) (440.244)
-
Cash flow hedge reserve gain / (losses)
37.391 159.807
-
Net investment hedge reserve gain / (losses)
(1.915.520) (600.051)
Deferred tax effect 22 478.323 96.489
Currency translation adjustment (1.953.335) (6.415.472)
@
Other comprehensive income items to be reclassified to profit or
(3.353.141) (6.759.227)
loss, net
@
Total Comprehensive Income After Tax (638.388) (3.512.402)
@
Total Comprehensive Income Attributable to:
Non-controlling interest 141.542 (336.543)
Equity holders of the parent (779.930) (3.175.859)

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Interim Condensed Consolidated Statement of Change in Equity for the three months ended March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

@
Other comprehensive income and expense 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
Adjustment
Differences
Share
Premium
Actuarial
Gains / Losses
Hedge
Reserve
Currency
Translation
Adjustment
Restricted
Reserves
Allocated from
Net Profit
Accumulated
Profit / Loss
Net Profit /
Loss for the
Period
Total Equity
of the Parent
Non
Controlling
Interest
Total Equity
@
January 1, 2023
@
254.371
@ @
3.710.396 3.222.101
@
(364.013)
@
(17.665.616)
@
22.994.949
@
2.509.378
@
16.313.706
@
15.967.088
@
46.942.360
@
7.310.494
@
54.252.854
@
Other comprehensive income/(loss)
Net profit / (loss) for the period
@
@
-
-
@
-
-
@
-
-
@
-
-
@
(343.755)
-
@
(6.012.417)
-
@
-
-
@
15.967.088
-
@
(15.967.088)
3.180.313
@
(6.356.172)
3.180.313
@
(403.055)
66.512
@
(6.759.227)
3.246.825
Total Comprehensive Income / (loss) @
-
@
-
@
-
@
-
@
(343.755)
@
(6.012.417)
@
-
@
15.967.088
@
(12.786.775)
@
(3.175.859)
@
(336.543)
@
(3.512.402)
@
Dividends
Transfers
@
-
-
@
-
-
@
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
@
March 31, 2023
@
254.371
@ @
3.710.396 3.222.101
(364.013) (18.009.371) 16.982.532 2.509.378 32.280.794 3.180.313 43.766.501 6.973.951 50.740.452
@
January 1, 2024
@
254.371
@ @
3.710.396 3.131.953
@
(444.545)
@
(25.372.038)
@
16.216.992
@
2.348.707
@
21.678.923
@
23.679.963
@
45.204.722
@
6.522.045
@
51.726.767
@
Other comprehensive income/(loss)
Net profit / (loss) for the period
@
-
-
@
-
-
@
-
-
@
4.966
-
@
(1.399.806)
-
@
(2.100.964)
-
@
-
-
@
23.679.963
-
@
(23.679.963)
2.715.874
@
(3.495.804)
2.715.874
@
147.629
(6.087)
@
(3.348.175)
2.709.787
@
Total Comprehensive Income / (loss)
@
-
@
-
@
-
@
4.966
@
(1.399.806)
@
(2.100.964)
@
-
@
23.679.963
@
(20.964.089)
@
(779.930)
@
141.542
@
(638.388)
@
Dividends
Transfers
@
@
-
-
@
@
-
-
@
@
-
-
@
@
-
-
@
@
-
-
@
@
-
-
@
@
-
-
@
@
-
-
@
@
-
-
@
@
-
-
@
@
(1.079)
-
@
@
(1.079)
-
@
March 31, 2024 254.371 3.710.396 3.131.953 (439.579) (26.771.844) 14.116.028 2.348.707 45.358.886 2.715.874 44.424.792 6.662.508 51.087.300

(Convenience Translation into English of Interim Consolidated Financial Statements and Notes Originally Issued in Turkish) COCA-COLA İÇECEK ANONİM ŞİRKETİ

Interim Condensed Consolidated Statement of Cash Flow for the three months period ended of March 31, 2024 (Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

@ @ Unaudited Unaudited
@ Notes March 31, 2024 March 31, 2023
@
Net profit / (loss) from continuing operations for the period
@
@
@
@
2.709.787
@
3.246.825
Adjustments to reconcile net profit / (loss) @ 802.716 (227.136)
Adjustments for depreciation and amortization expense @ 1.214.681 1.167.968
Adjustments for impairment loss (reversal) @ 87.801 7.459
- Provision / (reversal) for expected credit loss @ 104.606 (3.109)
- Provision / (reversal) for inventories @ (17.832) (4.367)
- Impairment loss / (reversal) in property, plant and equipment 12, 20 1.027 14.935
Adjustments for provisions @ 202.743 177.739
- Provision / (reversal) for employee benefits @ 202.743 177.739
Adjustments for interest (income) expenses @ 1.510.830 658.962
- Interest income 21 (321.630) (203.862)
- Interest expense 21 1.832.460 862.824
Adjustments for fair value loss (gain) @ (86.557) (205.289)
- Adjustments for fair value of derivative instruments (gain) / loss @ (86.557) (205.289)
Adjustments for unrealized currency translation @ (299.850) 286.104
Gain / loss from joint ventures 11 2.161 15.899
Adjustments for tax (income) / expense @ 1.875.246 1.431.395
Adjustments for (gain) / loss on sale of property, plant and equipment 20 15.374 (40.291)
Interest expense from lease liabilities 8, 21 20.611 28.107
Adjustments for monetary gain loss (3.740.324) (3.755.189)
Changes in working capital @ (1.892.450) (2.803.241)
Adjustments for decrease (increase) in trade receivables @ (7.323.954) (6.594.793)
- Decrease / (increase) on trade receivables due from related parties @ 225.500 98.922
- Decrease / (increase) on trade receivables due from third parties @ (7.549.454) (6.693.715)
Adjustments for decrease / (increase) in inventories @ 1.657.944 (1.930.510)
Adjustments for increase (decrease) in trade payables @ 341.842 4.698.409
- Increase / (decrease) on trade payables due to related parties @ 1.484.895 4.106.769
- Increase / (decrease) on trade payables due to third parties @ (1.143.053) 591.640
Adjustments for increase (decrease) in other payables @ 3.431.718 1.023.653
Cash flows generated from operating activities 1.620.053 216.448
@ @
@
Payments made for employee benefits @ (150.848) (239.677)
Tax returns / (payments) @ (985.180) (736.421)
Other current and non-current assets and liabilities @ (1.114.287) (1.212.633)
(630.262) (1.972.283)
A. NET CASH GENERATED FROM OPERATING ACTIVITIES
@
@
@
Cash outflows arising from purchase of property, plant, equipment, and
intangible assets
@ (2.232.146) (2.158.640)
- Cash outflow from purchase of property, plant, and equipment 12 (2.131.704) (2.123.240)
- Cash outflow from purchase of intangibles 13 (100.442) (35.400)
Proceeds from sale of property, plant and equipment and intangibles @ 26.352 117.952
Other inflows / (outflows) of cash @ (99.191) (1.101.452)
Cash outflow from acquisition of subsidiary @ (814.412) -
B. NET CASH USED IN INVESTING ACTIVITIES @ (3.119.397) (3.142.140)
@ @
Cash outflow due to lease liabilities 8 (84.237) (108.900)
Proceeds from borrowings 8 4.881.570 5.437.610
Repayments of borrowings 8 (5.570.346) (2.638.357)
Cash inflow / outflow due to derivative instruments @ (45.424) 23.198
Interest paid 8 (2.329.452) (1.031.941)
Interest received @ 290.552 205.471
Dividend paid @ (1.079) -
C. NET CASH USED IN FINANCING ACTIVITIES @ (2.858.416) 1.887.081
@ @
D. MONETARY GAIN / LOSS ON CASH AND CASH EQUIVALENTS (454.435) (291.323)
Net increase / (decrease) in cash and cash equivalents before currency
translation effects (A+B+C+D)
@ (7.062.510) (3.518.665)
E. CURRENCY TRANSLATION ON CASH AND CASH EQUIVALENTS @ 812.130 (656.180)
@
Net increase / (decrease) in cash and cash equivalents (A+B+C+D+E) @ (6.250.380) (4.174.845)
F. CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 5 25.031.776 26.560.182
@ @
CASH AND CASH EQUIVALENTS AT PERIOD END (A+B+C+D+E+F) 5 18.781.396 22.385.337

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

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 Türkiye, 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 13 (2023 - 13) production facilities in different regions of Türkiye and operates 21 (2023 - 20) production facilities in countries other than Türkiye. The registered office address of CCI is OSB Mah. Deniz Feneri Sok. No:4 Ümraniye İstanbul, Türkiye.

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 22, 2024, which were signed by the Audit Committee and Chief Executive Officer Karim Yahi. The General Assembly and the regulatory bodies have the right to make amendments to the consolidated financial statements after their issuance.

Shareholders of the Company

The company is controlled by AG Anadolu Grubu Holding A.Ş., the parent company. AG Anadolu Grubu Holding A.Ş. is controlled by AG Sınai Yatırım ve Yönetim A.Ş. and AG Sınai Yatırım ve Yönetim A.Ş. is a management company, which is ultimately managed by the Özilhan Family and Süleyman Kamil Yazıcı Family in accordance with equal representation and equal management principle and manages AG Anadolu Grubu Holding A.Ş.'s companies.

As of March 31, 2024, and December 31, 2023, the composition of shareholders and their respective percentage of ownership can be summarized as follows:

March 31, 2024 December 31, 2023
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. 2.020 0,79% 2.020 0,79%
Publicly Traded 73.402 28,86% 73.402 28,86%
254.371 100,00% 254.371 100,00%
Inflation Restatement Effect 3.710.396 3.710.396
3.964.767 3.964.767

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 Türkiye. The sole operation area of the Company is the 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 Zero Sugar, Coca-Cola Light, Fanta, Sprite, Cappy, Sen Sun, Powerade and Fuse Tea in TCCC authorized packages throughout Türkiye provided by 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 2018 and 2028.

The Company has exclusive rights to produce, sell and distribute Burn and Gladiator branded energy drinks in authorized packages throughout Türkiye, according to the Bottlers Agreements signed between the Company and Monster Energy Company ("MEC") and has the right for selling and distribution of Monster branded products in accordance with the International Distribution Agreement signed with Monster Energy Limited ("MEL") which has taken over TCCC's global energy drink portfolio and is partially owned by TCCC as well.

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

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

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

1. CORPORATE INFORMATION AND NATURE OF ACTIVITIES (continued)

Subsidiaries and Joint Ventures

As of March 31, 2024, and December 31, 2023 the list of CCI's subsidiaries and joint ventures and its effective participation percentages are as follows:

Subsidiaries

Effective Shareholding and
Voting Rights
Place of
Incorporation
Principal Activities March 31, 2024 December 31,
2023
Coca-Cola Satış ve Dağıtım Anonim
Şirketi ("CCSD")
Türkiye Distribution and sales of Coca
Cola products
99,97% 99,97%
Anadolu Etap Penkon Gıda ve İçecek
Ürünleri San. Ve Tic. A.Ş. ("Etap")
Türkiye Production and sale of fruit,
vegetable juice and concentrate
80,00% 80,00%
J.V. Coca-Cola Almaty Bottlers Limited
Liability Partnership ("Almaty CC")
Kazakhstan Production, distribution, and sales
of Coca-Cola products
100,00% 100,00%
Azerbaijan Coca-Cola Bottlers Limited
Liability Company ("Azerbaijan CC")
Azerbaijan Production, distribution, and sales
of Coca-Cola products
99,87% 99,87%
Coca-Cola Bishkek Bottlers Closed Joint
Stock Company ("Bishkek CC")
Kyrgyzstan Production, distribution, and sales
of Coca-Cola products
100,00% 100,00%
CCI International Holland B.V. ("CCI
Holland")
Holland Holding company 100,00% 100,00%
The Coca-Cola Bottling Company of
Jordan Limited ("TCCBCJ")
Jordan Production, distribution, and sales
of Coca-Cola products
100,00% 100,00%
Turkmenistan Coca-Cola Bottlers
("Turkmenistan CC")
Turkmenistan Production, distribution, and sales
of Coca-Cola products
59,50% 59,50%
Sardkar for Beverage Industry/Ltd
("SBIL")
Iraq Production, distribution, and sales
of Coca-Cola products
100,00% 100,00%
Waha Beverages B.V. ("Waha B.V.") Holland Holding Company 100,00% 100,00%
Coca-Cola Beverages Tajikistan Limited
Liability Company ("Tajikistan CC")
Tajikistan Production, distribution, and sales
of Coca-Cola products
100,00% 100,00%
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
100,00% 100,00%
Coca-Cola Beverages Pakistan Limited
("CCBPL")
Pakistan Production, distribution, and sales
of Coca-Cola products
99,34% 99,34%
Coca-Cola Bangladesh Beverages Limited
("CCBB") (1)
Bangladesh Production, distribution, and sales
of Coca-Cola products
100,00% -
LLC Coca-Cola Bottlers Uzbekistan
("CCBU")
Uzbekistan Production, distribution, and sales
of Coca-Cola products
100,00% 100,00%
CCI Samarkand Limited LLC
("Samarkand")
Uzbekistan Production, distribution, and
sales of Coca-Cola products
100,00% 100,00%
CCI Namangan Limited LLC
("Samarkand")
Uzbekistan Production, distribution, and
sales of Coca-Cola products
100,00% 100,00%

(1) As of February 20, 2024, the purchase of shares representing all of the capital of CCBB company was completed for 130 million USD (Note 3).

Joint Venture

Place of
Incorporation
Principal
Activities
Effective Shareholding and
Voting Rights
March 31, 2024 December 31, 2023
Syrian Soft Drink Sales and
Distribution L.L.C. (''SSDSD'')
Syria Distribution and sales of
Coca-Cola products
50,00% 50,00%

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

1. CORPORATE INFORMATION and NATURE OF ACTIVITIES (continued)

Economic Conditions and Risk Factors of Subsidiaries and Joint Ventures

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 CMB's "Corporate Governance Principles" assess, manage and report Group risks. Some of the Group priority risks are defined as political instability and security, cyber security, exchange rate volatility, sustainable talent capability, corporate reputation, water, and environmental impact of packaging, changing consumer preferences, discriminatory tax and regulations, channel mix shift, economic slowdown, law and order and industrial relations. 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 ended March 31, 2024, 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, 2024, and 2023).

March 31, 2024 March 31, 2023
Blue-collar 4.328 4.325
White-collar 5.548 5.493
Average number of employees 9.876 9.818

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

2. BASIS OF CONSOLIDATED FINANCIAL STATEMENT PRESENTATION

Basis of Preparation of Financial Statements

Statement of Compliance with TFRS

The Group has prepared its condensed consolidated financial statements for the interim period ended March 31, in the scope of the CMB's "Communiqué on Financial Reporting in Capital Market" Numbered II-14.1 (Communiqué), published in the Official Gazette dated June 13, 2013 and numbered 28676, , and the announcements explaining this communiqué, TAS 34, "Interim Financial Reporting". The interim condensed consolidated financial statements and explanatory notes are presented using the compulsory standard formats as published by the Communiqué. The entities are allowed to prepare a complete or condensed set of interim financial statements in accordance with TAS 34. In this respect, the Group has preferred to prepare condensed consolidated financial statements in the interim periods.

In addition, the consolidated financial statements are presented in accordance with the specified format in "TFRS Taxonomy Announcement", issued on 15 October 2022 by the POA, and "the Financial Statements Examples and Guidelines for Use", which is published by the Capital Markets Board of Türkiye.

CCI and its subsidiaries, which operate in Türkiye, keep their accounting books and their statutory financial statements in Turkish Lira ("TL") in accordance with the regulations on accounting and reporting framework and accounting standards promulgated by the CMB, Turkish Commercial Code ("TCC") and Tax Legislation and the Uniform Chart of Accounts which is issued by the Ministry of Finance. The foreign subsidiaries keep their accounting books and statutory financial statements in their local currencies and in accordance with the rules and regulations of the countries in which they operate.

The interim condensed consolidated financial statements have been prepared from the statutory financial statements of Group's subsidiaries' and joint ventures and presented in TL in accordance with Turkish Financial Reporting Standards ("TFRS") as adopted by the Public Oversight Accounting and Auditing Standards ("POA") and CMB 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, consolidated financial statements are prepared on a historical cost basis.

Summary of Significant Accounting Policies and Changes

As of 31 March 2024, interim condensed consolidated financial statements have been prepared by applying the accounting policies that are consistent with the accounting policies applied during the preparation of the consolidated financial statements for the year ended 31 December 2023, except for the new standards and TFRYK interpretations summarized below.

Interim condensed consolidated financial statements do not contain all the explanations and footnotes that are required to be included in the year-end consolidated financial statements. Therefore, these interim condensed consolidated financial statements should be evaluated together with the consolidated financial statements for the year ended 31 December 2023.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

2. BASIS OF CONSOLIDATED FINANCIAL STATEMENT PRESENTATION (continued)

Financial Reporting in High-Inflation Economies

Based on the announcement made by the POA on 23 November 2023 and the "Implementation Guide on Financial Reporting in Economies with High Inflation", the Group prepared its condensed consolidated financial statements for the interim period dated 31 March 2024 and ending on the same date by applying TAS 29 "Financial Reporting in Economies with High Inflation". In accordance with the said standard, financial statements prepared based on the currency of a hyperinflationary economy are prepared in the purchasing power of this currency at the balance sheet date, and comparative information is expressed in terms of the current measurement unit at the end of the reporting period for the purpose of comparison of previous period financial statements. For this reason, the Group has presented its consolidated financial statements as of 31 December 2023 on the purchasing power basis as of 31 March 2024.

Based on the CMB's decision dated 28 December 2023 and numbered 81/1820, issuers and capital market institutions subject to financial reporting regulations applying Turkish Accounting/Financial Reporting Standards will apply inflation accounting by applying the provisions of TAS 29, starting from their annual financial reports for the accounting periods ending as of December 31, 2023.

The adjustments made in accordance with TAS 29 were made using the correction coefficient obtained from the Consumer Price Index in Türkiye ("CPI") published by the Turkish Statistical Institute ("TSI"). As of March 31, 2024, the indices and correction coefficients used in the correction of consolidated financial statements are as follows:

Date Index Coefficient Three Year Compound Interest Rate
31 March 2024 2.139,47 1,00000 211%
31 December 2023 1.859,38 1,15064 268%
31 March 2023 1.269,75 1,68495 152%
31 December 2022 1.128,45 1,89594 156%

The main elements of the Company's adjustment for financial reporting purposes in high-inflation economies are as follows:

  • Current period financial statements prepared in TL are expressed with the purchasing power of money valid at the balance sheet date, and the amounts from previous reporting periods are expressed by correcting the purchasing power of money at the last balance sheet date.

  • Monetary assets and liabilities are not adjusted as they are currently expressed with current purchasing power at the balance sheet date. In cases where the inflation-adjusted values of non-monetary items exceed the recoverable amount or net realizable value, the provisions of TAS 36 and TAS 2 were applied, respectively.

  • Non-monetary assets and liabilities and equity items that are not expressed in current purchasing power at the balance sheet date have been corrected using the relevant correction coefficients.

  • All items included in the income statements and other comprehensive income statements, except cost of sales, depreciation expense, profit/loss on asset sales, have been adjusted using the relevant monthly adjustment coefficients. Cost of sales, depreciation expense, asset sales profit/loss items have been recalculated on the basis of adjusted balance sheet items using correction coefficients.

  • All items in the statement of cash flows are expressed in the unit of measurement valid at the end of the reporting period

  • The effect of inflation on the Company's net monetary asset position in the current period is recorded in the net monetary position loss account in the income statement.

Comparative Figures:

  • The relevant figures for the previous reporting period are rearranged by applying the general price index so that comparative financial statements are presented in the unit of measurement valid at the end of the reporting period. Information disclosed for previous periods is also presented in the measurement unit valid at the end of the reporting period.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

2. BASIS OF CONSOLIDATED FINANCIAL STATEMENT PRESENTATION (continued)

New and Amended Turkish Financial Reporting Standards

a) Standards, amendments, and interpretations applicable as of 31 March 2024:

  • Amendment to TAS 1 – Non-current liabilities with covenants; effective from annual periods beginning on or after 1 January 2024. These amendments clarify how conditions with which an entity must comply within twelve months after the reporting period affect the classification of a liability. The amendments also aim to improve information an entity provides related to liabilities subject to these conditions.
  • Amendment to TFRS 16 – Leases on sale and leaseback; effective from annual periods beginning on or after 1 January 2024. These amendments include requirements for sale and leaseback transactions in TFRS 16 to explain how an entity accounts for a sale and leaseback after the date of the transaction. Sale and leaseback transactions where some or all the lease payments are variable lease payments that do not depend on an index or rate are most likely to be impacted.
  • Amendments to TAS 7 and TFRS 7 on Supplier finance arrangements; effective from annual periods beginning on or after 1 January 2024. These amendments require disclosures to enhance the transparency of supplier finance arrangements and their effects on a company's liabilities, cash flows and exposure to liquidity risk. The disclosure requirements are the IASB's response to investors' concerns that some companies' supplier finance arrangements are not sufficiently visible, hindering investors' analysis.
  • TFRS 1, 'General requirements for disclosure of sustainability-related financial information; effective from annual periods beginning on or after 1 January 2024. This standard includes the core framework for the disclosure of material information about sustainability-related risks and opportunities across an entity's value chain.
  • TFRS 2, 'Climate-related disclosures'; effective from annual periods beginning on or after 1 January 2024. This is the first thematic standard issued that sets out requirements for entities to disclose information about climate-related risks and opportunities.

b) Standards, amendments, and interpretations that are issued but not effective as of 31 March 2024: The Group has not yet implemented the following standards that have not yet entered into force and the following changes and interpretations to existing previous standards:

  • TFRS 17, 'Insurance Contracts'; effective from annual periods beginning on or after 1 January 2023. This standard replaces TFRS 4, which permitted a wide variety of practices in accounting for insurance contracts. TFRS 17 will fundamentally change the accounting by all entities that issue insurance contracts.
  • Amendments to TAS 21 - Lack of Exchangeability; effective from annual periods beginning on or after 1 January 2025. An entity is impacted by the amendments when it has a transaction or an operation in a foreign currency that is not exchangeable into another currency at a measurement date for a specified purpose. A currency is exchangeable when there is an ability to obtain the other currency (with a normal administrative delay), and the transaction would take place through a market or exchange mechanism that creates enforceable rights and obligations.

These changes are not expected to have a significant impact on the Group's financial position and performance.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

2. BASIS OF CONSOLIDATED FINANCIAL STATEMENT PRESENTATION (continued)

Functional and Presentation Currency

The majority of the consolidated foreign subsidiaries and joint venture are regarded as foreign operations since they are financially, economically and organizationally autonomous. The Group translates in accordance with "TAS 21 The Effects of Changes in Foreign Exchange Rates" The resulting translated amounts for non-monetary items are treated as their historical cost.

Functional and presentation currency of the Group is Turkish Lira (TL). Functional currencies of the subsidiaries and joint ventures are as follows:

March 31, 2024 December 31, 2023
Local Currency Functional Currency Local Currency Functional Currency
CCSD Turkish Lira Turkish Lira Turkish Lira Turkish Lira
ETAP Turkish Lira Turkish Lira Turkish Lira Turkish Lira
Almaty CC Kazakh Tenge Kazakh Tenge Kazakh Tenge Kazakh Tenge
Azerbaijan CC Manat Manat Manat Manat
Turkmenistan CC Turkmen Manat Turkmen Manat Turkmen Manat Turkmen Manat
Bishkek CC Som Som Som Som
TCCBCJ Jordanian Dinar Jordanian Dinar Jordanian Dinar Jordanian Dinar
SBIL Iraq Dinar Iraq Dinar Iraq Dinar Iraq Dinar
SSDSD Syrian Pound Syrian Pound Syrian Pound Syrian Pound
CCBPL Pakistan Rupee Pakistan Rupee Pakistan Rupee Pakistan Rupee
CCBB Bangladesh Taka Bangladesh Taka Bangladesh Taka Bangladesh Taka
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 Iraq Dinar Iraq Dinar Iraq Dinar
Tajikistan CC Somoni Somoni Somoni Somoni
CCBU Som Som Som Som
Namangan Som Som Som Som
Samarkand Som Som Som Som

Foreign Currency Translations

Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. All differences are recorded in the consolidated income statement of the relevant period, as foreign currency loss or gain. Foreign currency translation rates announced by the Central Bank of the Republic of Türkiye used by the Group's subsidiaries in Türkiye. USD amounts presented in the asset accounts are translated into TL with the official TL exchange rate of USD buying on March 31, 2024, USD 1,00 (full) = TL 32,2854 (December 31, 2023; USD 1,00 (full) = TL 29,4382) whereas USD amounts in the liability accounts are translated into TL with the official TL exchange rate of USD selling on March 31, 2024, USD 1,00 (full) = TL 32,3436 (December 31, 2023; USD 1,00 (full) = TL 29,4913). Furthermore, USD amounts in the income statement are translated into TL, at the average TL exchange rate for USD buying for the period is USD 1,00 (full) = TL 30,9035 (January 1 - March 31, 2023; USD 1,00 (full) = TL 18,8549).

The assets and liabilities of subsidiaries and joint ventures operating in foreign countries are translated at the rate of exchange ruling at the balance sheet date and the income statements of foreign subsidiaries and joint ventures are translated at average exchange rates. Differences that occur by the usage of closing and average exchange rates are followed under currency translation differences classified under equity.

Offsetting

Financial assets and liabilities are offset, and the net amount is reported in the balance sheet when there is a legally enforceable right to set off the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously.

Estimates, Assumptions and Judgements Used

For the condensed consolidated interim financial statements, as of March 31, 2024, 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 condensed 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

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

the assumptions and estimations made for the year ended December 31, 2023, except for the necessary considerations made for income taxes.

3. BUSINESS COMBINATIONS

As of February 20, 2024, the Group purchased 100% of the shares representing the capital of CCBB in return for the share value calculated by deducting the estimated net financial debt as of the closing date from the enterprise value of 130 million USD. Share Value is subject to a price adjustment mechanism and will be recalculated upon finalization of CCBB's net financial liability as of the closing date through a closing audit to be conducted after closing.

CCBB
Net Book
Value
Cash and cash equivalents 91.606
Trade receivables and other receivables 15.664
Inventories 956.550
Property plant and equipments 3.725.381
Right of use assets 21.580
Other current and non-current assets 222.360
Total assets 5.033.141
Deferred tax liability and tax provision 142.648
Borrowings 2.230.211
Trade payables 724.310
Other liabilities 399.469
Total liabilities 3.496.638
Net assets 1.536.503
Consideration(*) 1.821.463
Consolidated net assets 1.536.503
Provisional goodwill arising from acquisition 284.960

(*) 1,821,463 TL was calculated by deducting 2,187,581 TL of company debts from the purchase price which calculated as 4,009,044 TL.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

4. 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.

Adjusted earnings before interest and tax (Adjusted EBITDA) is not an accounting measure under TFRS accounting and does not have a standard calculation method however it has been considered as the optimum indicator for the evaluation of the performance of the operating segments by considering the comparability with the entities in the same business.

Group's domestic and international subsidiaries are presented under Note 1 and Group's segment reporting is as follows:

@ March 31, 2024
@ Domestic International Elimination Consolidated
@ @ @ @ @
Net Revenue 10.686.069 16.593.899 (50.070) 27.229.898
Cost of sales (-) (7.138.854) (11.057.885) 16.334 (18.180.405)
Gross profit 3.547.215 5.536.014 (33.736) 9.049.493
@
Operating expenses (-) (3.544.776) (2.691.710) 348.112 (5.888.374)
Other operating income / (expense), net 2.444.813 (82.198) (2.312.041) 50.574
Profit from operations 2.447.252 2.762.106 (1.997.665) 3.211.693
@
Gain from investing activities 2.590 4.447 (2.582) 4.455
Loss from investing activities (-)
Gain / (loss) from joint ventures
(19.779)
-
(3.659)
(2.161)
2.582
-
(20.856)
(2.161)
Profit before financial income / (expense) 2.430.063 2.760.733 (1.997.665) 3.193.131
@
Financial income
1.062.087 229.467 (25.013) 1.266.541
Financial expense (-) (3.857.067) (495.042) 1.940.534 (2.411.575)
Monetary Gain Loss 2.536.936 - - 2.536.936
Profit before tax from continuing operations 2.172.019 2.495.158 (82.144) 4.585.033
@
Tax income / (expense) from continuing operations (514.423) (667.550) (693.273) (1.875.246)
Net profit or (loss) from continuing operations 1.657.596 1.827.608 (775.417) 2.709.787
@
Non-controlling interest (10.580) 4.493 - (6.087)
Equity holders of the parent 1.668.176 1.823.115 (775.417) 2.715.874
@
Purchase of property, plant, equipment and
368.880 1.863.266 - 2.232.146
intangible asset
@
Amortization expense of right of use asset
26.108 25.143 - 51.251
Depreciation and amortization expenses 487.657 675.773 - 1.163.430
Other non-cash items 16.614 81.119 (60.279) 37.454
Adjusted EBITDA 2.977.631 3.544.141 (2.057.944) 4.463.828
@ March 31, 2024
@ Domestic International Elimination Consolidated
@
@
100.527.040 @
80.645.161
@
(49.535.559)
@
131.636.642
Total Assets
Total Liabilities
44.120.646 40.504.443 (4.075.747) 80.549.342

As of March 31, 2024, the portion of Almaty CC in the consolidated net revenue and total assets is 20% and 9% respectively. (March 31, 2023: 22% and 9%).

As of March 31, 2024, the portion of CCBPL in the consolidated net revenue and total assets is 12% and 11% respectively. (March 31, 2023: 16% and 10%).

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

4. SEGMENT REPORTING (continued)

@ March 31, 2023
@ Domestic International Elimination Consolidated
@ @ @ @ @
Net Revenue 9.761.832 16.718.124 (29.532) 26.450.424
Cost of sales (-) (7.343.809) (10.980.007) 10.342 (18.313.474)
Gross profit 2.418.023 5.738.117 (19.190) 8.136.950
@
Operating expenses (-) (2.730.792) (2.543.090) 254.800 (5.019.082)
Other operating income / (expense), net (4.837.881) 6.878.490 (2.004.386) 36.223
Profit / (loss) from operations (5.150.650) 10.073.517 (1.768.776) 3.154.091
@
Gain from investing activities 26.317 17.158 (1.002) 42.473
Loss from investing activities (-) (1.001) (17.119) 1.003 (17.117)
Gain / (loss) from joint ventures - (15.899) - (15.899)
Profit before financial income/(expense) (5.125.334) 10.057.657 (1.768.775) 3.163.548
@
Financial income 400.693 1.521.902 (18.371) 1.904.224
Financial expense (-) (1.492.242) (1.797.855) 617.989 (2.672.108)
Monetary Gain Loss 2.282.556 - - 2.282.556
Profit before tax from continuing operations (3.934.327) 9.781.704 (1.169.157) 4.678.220
@
Tax income / (expense) from continuing operations (326.333) (788.307) (316.755) (1.431.395)
Net profit or (loss) from continuing operations (4.260.660) 8.993.397 (1.485.912) 3.246.825
@
Non-controlling interest - 66.512 - 66.512
Equity holders of the parent (4.260.660) 8.926.885 (1.485.912) 3.180.313
@
Purchase of property, plant, equipment and 325.822 1.832.818 - 2.158.640
intangible asset
@
Amortization expense of right of use asset 35.989 23.138 - 59.127
Depreciation and amortization expenses 484.913 623.928 - 1.108.841
Other non-cash items 72.535 22.459 (17.999) 76.995
Adjusted EBITDA (4.557.213) 10.743.042 (1.786.775) 4.399.054
@ December 31, 2023
@ Domestic International Elimination Consolidated
@ @ @ @ @
Total Assets 100.524.138 73.498.243 (47.270.198) 126.752.183
Total Liabilities 46.283.880 38.873.238 (10.131.702) 75.025.416

In addition to the requirements of segment reporting, The Group's management presented this information for certain financial statements readers to utilize this data during their analyses.

Company's "Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA)" definition and calculation is defined as; "Profit / (Loss) From Operations" plus relevant non-cash expenses including depreciation and amortization, provision for employee benefits like retirement and vacation pay (provisions for management bonus and long term incentive plan not included) and other non-cash expenses like negative goodwill and value increase due to change in scope of consolidation.

As of March 31, 2024, and 2023, reconciliation of Adjusted EBITDA to profit / (loss) from operations is explained in the following table:

@ March 31, 2024 March 31, 2023
@ @ @
Profit / (loss) from operations 3.211.693 3.154.091
Depreciation and amortization 1.163.430 1.108.841
Provision for employee benefits 121.261 92.619
Foreign exchange gain / (loss) under other operating income /
(expense) (Note 20)
(83.807) (15.624)
Amortization expense of right of use asset 51.251 59.127
Adjusted EBITDA 4.463.828 4.399.054

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

5. CASH AND CASH EQUIVALENTS

@ March 31, 2024 December 31, 2023
@
@
Cash on hand
@
29.323
37.522
Cash in banks
-Time deposit
12.757.208 18.768.923
-Demand deposit 5.915.362 6.225.331
Cheques 79.503 -
18.781.396 25.031.776

As of March 31, 2024, time deposits with maturities less than 3 months in foreign currencies, existed for periods varying between 1 day to 73 days (December 31, 2023 - 1 day to 74 days) and earned interest between 0,50% - 20,5% (December 31, 2023 - 0,50% - 20,50%).

As of March 31, 2024, time deposits in local currency existed for periods varying between 1 days to 62 days (December 31, 2023 - TL, 2 days to 12 days) and earned interest between 43,50% - 50,00% (December 31, 2023 – 38,00% - 45,00%)

As of March 31, 2024, there is TL 35.334 (December 31, 2023 - TL 48.721) of interest income accrual on time deposits with maturities less than 3 months. As of March 31, 2024, and December 31, 2023, the fair values of cash and cash equivalents are equal to book value.

The credit risks of the banks where the Company has deposits are evaluated by taking into account independent data, and no significant credit risk is expected. The market values of cash and cash equivalents approximate their carrying values including the accrued interest income at the balance sheet date.

6. FINANCIAL INVESTMENTS

@ March 31, 2024 December 31, 2023
@ @ @
Time deposits with maturities more than 3 months 97 106
Foreign currency linked deposits 339.205 353.150
Restricted cash 144.775 79.121
@ 484.077 432.377

As of March 31, 2024, time deposits with maturities over 3 months are composed of USD with 88 days maturity and have interest rate 2,25% for USD.

As of December 31, 2023, time deposits with maturities over 3 months are composed of USD with 179 and have 2,25% interest rate.

Restricted bank balance is the blocked amount in the bank for collateral of letters of credit in Uzbekistan, Samarkand and Pakistan.

The interest rates for fx-protected deposit accounts are 35,00% (31 December 2023 –35,00)

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

7. DERIVATIVE FINANCIAL INSTRUMENTS

As of March 31, 2024, the Group has 14 aluminum swap transactions with a total nominal value of TL 1.794.881 for 23.427 tons, It has been designated as a hedging instrument that may arise from the cash flows of metal can purchases in years 2024-25 and has been subject to cash flow hedge accounting.

As of December 31, 2023, the Group has 10 aluminum swap transactions with a total nominal amount of TL 1.823.507 for 22.580 tons. It has been designated as a hedging instrument that may arise from the cash flows of metal can purchases in years 2023-25 and has been subject to cash flow hedge accounting.

As of March 31, 2024, the Group has 10 sugar swap transactions with a total nominal value of TL 1.389.300, worth 91.650 tons. The designation as a hedging instrument that may arise from the cash flows of sugar purchases in years 2024-2025 has been subject to cash flow hedge accounting.

As of December 31, 2023, the Group has 8 sugar swap transactions with a total nominal value of TL 1.415.139, worth 89.650 tons. The designation as a hedging instrument that may arise from the cash flows of sugar purchases in years 2024-2025 has been subject to cash flow hedge accounting.

As of March 31, 2024, the Group has a cross currency swap contract with a total amount of USD 150 million due on September 19, 2024, for the probability of arising exchange rate exposure in the long term. The Group has also purchased an option amounting to USD 150 million for hedging the foreign exchange exposure with those two derivative transactions (nominal amount of TL 4.482.810). In addition to the above transactions, the Group has a forward derivative financial instrument with a maturity of 19 September 2024 in the amount of 100 million USD in order to hedge against exchange rate risk.

As of December 31, 2023, the Group has a cross currency swap contract with a total amount of USD 150 million due on September 19, 2024, for the probability of arising exchange rate exposure in the long term. The Group has also purchased an option amounting to USD 150 million for hedging the foreign exchange exposure with those two derivative transactions (nominal amount of TL 5.080.916). In addition to the above transactions, the Group has a forward derivative financial instrument with a maturity of 19 September 2024 in the amount of 50 million USD in order to hedge against exchange rate risk.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

7. DERIVATIVE FINANCIAL INSTRUMENTS (continued)

Details of hedging instruments as of 31 March 2024 and 31 December 2023 are as follows:

31 March
2024
Nominal
Value
Outstanding
Amounts
Fair Value Asset /
(Liability)
Financial Position
Line Item
Maturity
Hedging Instruments:
Cash flow hedge reserves:
Commodity
swap contracts
-
Aluminum
1.794.881 23.427 tons (1.164) Derivative Instruments April 2024 -
December 2025
-
Sugar
1.389.300 91.650 tons 142.536 Derivative Instruments April 2024 -
December 2025
Fx forward 3.228.540 100 million USD 77.906 Derivative Instruments September 2024
Cross currency participation swap assets /
(liabilities)
4.842.810 150 million USD (209.383) Derivative Instruments September 2024
11.255.531 9.895
Net Investment Hedge:
Borrowings to hedge net investments in foreign
operations
- 650 million USD (21.023.340) Borrowings January 2029

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

7. DERIVATIVE FINANCIAL INSTRUMENTS (continued)

31 December 2023 Nominal
Value
Outstanding
Amounts
Fair Value Asset /
(Liability)
Financial Position
Line Item
Maturity
Hedging Instruments:
Cash flow hedge reserves::
Commodity swap contracts
-
Aluminum
-
Resin
Fx forward
Cross currency participation swap
assets /(liabilities)
1.823.507
1.415.139
1.693.639
5.080.916
22.580 tons
89.650 tons
50 million USD
150 million USD
31.676
131.974
14.754
(300.937)
Derivative Instruments
Derivative Instruments
Derivative Instruments
Derivative Instruments
January 2024 -
December 2025
January 2024 -
December 2025
September 2024
September 2024
Hedging Instruments: 10.013.201 (122.533)
Borrowings to hedge net investments in foreign
operations
- 650 million USD (22.057.015) Borrowings January 2029

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

8. BORROWINGS

@ March 31, 2024 December 31, 2023
@
@
@
Short-term borrowings 9.569.226 9.818.619
Current portion of long-term borrowings and bond issued 10.878.265 10.740.315
Total short-term borrowings 20.447.491 20.558.934
@
@
@
Long-term borrowings and bond issued 19.926.416 21.300.507
Total borrowings 40.373.907 41.859.441

As of March 31, 2024, there is interest expense accrual amounting to TL 982.535 on total amount of borrowings (December 31, 2023 – TL 1.353.239).

The Group has complied with the financial covenants of its borrowing facilities during the March 31, 2024 and December 31 2023 reporting periods. Short and long-term borrowings denominated in TL and foreign currencies as of March 31, 2024 and 31 December 2023, are as follows:

@ March 31, 2024 December 31, 2023
@ Short term Long term Short term Long term
@ @ @ @ @
TL 9.702.714 2.271.469 10.109.865 2.301.990
USD 5.271.780 16.178.624 5.531.186 16.963.914
EUR 1.715.079 1.078.688 2.964.332 1.619.236
BDT 1.436.631 -- - -
KZT 1.410.912 -- 1.514.074 -
PKR 820.930 -- 349.364 -
KGS 44.424 317.347 86.176 334.391
JOD 44.881 - 3.817 -
AZM 140 80.288 120 80.976
@ 20.447.491 19.926.416 20.558.934 21.300.507

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

March 31, 2024 December 31, 2023
Short-term
USD denominated borrowings (%3,00) - (%8,00) (%3,00) - (6M Libor + %2,50)
PKR denominated borrowings (1M Kibor - %0,10) - (6M Kibor + %1) (1M Kibor - %0,10) - (6M Kibor + %1)
TL denominated borrowings (%12,00 - %52,50) (%9,00 - %48,50)
KZT denominated borrowings (%15,80 - %16,85) (%16,55 - %16,85)
EUR denominated borrowings (%6,40 - (%10,70) (%7,25)
KGS denominated borrowings (%14,28) (%14,28)
BDT denominated borrowings (%7,45 - %10,38) -
JOD denominated borrowings (%9,50) (%9,50)
Long-term
USD denominated borrowings (%4,22) - (%7,04) (%4,22) - (%7,04)
EUR denominated borrowings (6M Euribor + %1,30) - (6M Euribor + %1,60) (6M Euribor + %1,30) - (6M Euribor + %2,75)
TL denominated borrowings (%27,64 - %47,00) (%27,64 - %47,00)
AZM denominated borrowings (%9,00) (%9,00)
KGS denominated borrowings (%14,28) (%14,28)

Repayment plans of long-term borrowings as of March 31, 2024, and 31 December 2023, are scheduled as follows (including current portion of long-term borrowings):

@ March 31, 2024 December 31, 2023
@ @ @
2024 9.688.963 10.740.315
2025 4.014.571 3.357.962
2026 and after 17.101.147 17.942.545
30.804.681 32.040.822

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

8. BORROWINGS (continued)

Movements of financial borrowings as of March 31, 2024 and 2023 are as follows:

@ March 31, 2024 March 31, 2023
@
Financial borrowing as of January 1st
@
@
@
41.859.441
38.599.146
Proceeds from borrowings 4.881.570 5.437.610
Repayments of borrowings (5.570.346) (2.638.357)
Addition through subsidiary acquired 2.208.631 -
Cash flows 1.519.855 2.799.253
@ @ @
Adjustments for interest expense 1.832.460 862.824
Interest paid (2.329.452) (1.031.941)
Changes in interest accruals (496.992) (169.117)
@
Foreign exchange loss / (gain) from foreign currency
denominated borrowings
@
2.386.000
@
1.223.255
Monetary gain / loss (4.146.546) (3.935.283)
Currency translation adjustment (747.851) (879.532)
Financial borrowing at the end of period end 40.373.907 37.637.722

Lease Liabilities

As of March 31, 2024, net present value of liabilities under lease liabilities are amounting to TL 692.267. Movement tables of lease liabilities as of March 31, 2024 and 2023 are as follows:

@ March 31, 2024 March 31, 2023
@ @ @
Balance as of January 1st 759.785 920.037
Increase in lease liabilities 15.098 189.134
Change in lease liabilities 1.114 3.698
Payments during the period (84.237) (108.900)
Interest expense of lease liabilities 20.611 28.107
Foreign exchange loss / (gain) 2.104 2.179
Addition through subsidiary acquired 21.580 -
Currency translates on differences (43.788) (171.231)
Balance at the end of the period end 692.267 863.024

9. OTHER RECEIVABLES AND PAYABLES

Other Receivables

@ March 31, 2024 December 31, 2023
@ @ @
Receivables due from personnel 41.700 40.038
Deposits and guarantees given 5.741 5.648
Other 112.768 93.010
@ 160.209 138.696

Other Payables

@ March 31, 2024 December 31, 2023
@ @ @
Deposits and guarantees 1.791.419 1.404.754
Taxes and duties payable 4.085.207 1.170.683
Other 159.429 28.037
@ 6.036.055 2.603.474

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

10. PREPAID EXPENSES

a) Short term prepaid expenses

@ March 31, 2024 December 31, 2023
@ @
@
Prepaid marketing expenses 772.662 642.826
Prepaid insurance expenses 174.840 209.140
Prepaid rent expenses 39.037 11.126
Prepaid other expenses 270.034 309.630
Advances given to suppliers 1.558.924 974.943
@ 2.815.497 2.147.665
b) Long term prepaid expenses
@ March 31, 2024 December 31, 2023
@
Prepaid marketing expenses
@
@
249.447
294.116
Prepaid other expenses 32.303 29.938
Advances given to suppliers
@
864.183
1.145.933
1.076.530
1.400.584
c) Short term deferred income
March 31, 2024 December 31, 2023
Advances received 155.291 170.544
Deferred income 79.059 65.770
234.350 236.314
d) Long term deferred income
March 31, 2024 December 31, 2023
Deferred income 37.136 50.981
37.136 50.981

11. INVESTMENT IN JOINT VENTURES

Investment in joint ventures, consolidated under the equity method of accounting, is carried in the consolidated financial position at cost plus post-acquisition changes in the Group's share of net assets of the joint ventures, less any impairment in value. The consolidated income statement reflects the Group's share of the results of operations of the joint ventures.

As of March 31, 2024, and December 31, 2023, total assets, total liabilities, net sales, and current period loss of SSDSD is as follows:

SSDSD March 31, 2024 December 31, 2023
Total assets 177 217
Total liabilities 60.406 61.585
Equity (60.229) (61.368)
SSDSD March 31, 2024 December 31, 2023
Net revenue - -
Net loss for the period (4.322) (31.799)
Group's share in loss (2.161) (15.899)

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

12. PROPERTY, PLANT AND EQUIPMENT

As of March 31, 2024 and 2023, property, plant and equipment movement tables are as follows:

(Impairment) Acquired
through
Currency
January 1, / Impairment business translation March 31,
Cost 2024 Additions Transfers Disposals reversal, net combination differences 2024
@ @ @ @ @ @ @ @
Land and buildings 21.132.289 8.607 126.014 - - 855.329 (544.776) 21.577.463
Machinery and equipment 41.007.196 230.707 965.115 (15.860) 2.034 1.293.567 (879.080) 42.603.679
Vehicles 956.326 332 1.901 (2.680) - 3.343 (45.289) 913.933
Furniture and fixtures 1.262.481 5.716 (475) (1.350) - 26.032 (16.766) 1.275.638
Other tangibles (*) 21.243.704 145.975 14.940 (177.043) 2.421 1.317.571 (402.512) 22.145.056
Leasehold improvements 201.628 - - - - 2.490 (3.275) 200.843
Construction in progress 3.375.902 1.740.367 (1.107.495) - (5.482) 1.441.213 (302.728) 5.141.777
@ 89.179.526 2.131.704 - (196.933) (1.027) 4.939.545 (2.194.426) 93.858.389
@ @ @ @ @ @ @ @
Accumulated depreciation
and impairment (-) @ @ @ @ @ @ @
Land improvements and (6.565.609) (110.408) - - - (137.347) 136.490 (6.676.874)
buildings
Machinery and equipment (26.568.608) (474.748) - 15.860 - (396.685) 495.663 (26.928.518)
Vehicles (572.033) (21.236) - 2.680 - (3.343) 26.500 (567.432)
Furniture and fixtures (1.002.091) (12.242) - 1.285 - (21.733) 11.761 (1.023.020)
Other tangibles (13.779.806) (475.560) - 135.382 - (654.283) 152.019 (14.622.248)
Leasehold improvements (149.124) (147) - - - (773) 544 (149.500)
@ (48.637.271) (1.094.341) - 155.207 - (1.214.164) 822.977 (49.967.592)
@ @ @ @ @ @ @ @
Net book value 40.542.255 1.037.363 - (41.726) (1.027) 3.725.381 (1.371.449) 43.890.797

(*) Coolers and returnable bottles are followed in other tangible assets.

As of March 31, 2024, pledge amounting to TL 97.766 on property, plant and equipment (31 March 2023: TL 97.725. This amount is also disclosed in GPM table (Note 16).

Impairment Loss

As of March 31, 2024, the Group had TL 1.027 provided impairment losses (March 31, 2023 – TL 14.935) 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 (Note 20).

As of March 31, 2024, reversal of impairment amounting to TL 4.455 (December 31, 2023 – TL 2.182) (Note 20).

(Impairment)/ Currency
Impairment translation March 31,
Cost January 1, 2023 Additions Transfers(**) Disposals reversal, net differences 2023
@ @ @ @ @ @ @ @
Land and buildings 20.563.468 42.242 94.308 (1.695) - (1.975.334) 18.722.989
Machinery and
equipment(***)
40.772.843 513.045 (754.719) (17.653) 280 (3.484.178) 37.029.618
Vehicles 941.761 55.024 - (5.092) - (87.348) 904.345
Furniture and fixtures 1.290.938 6.868 (14.061) (2.105) - (108.873) 1.172.767
Other tangibles(*) 20.851.147 347.024 225.264 (150.473) (15.215) (1.535.396) 19.722.351
Leasehold improvements 230.865 - (3.447) - - (29.306) 198.112
Construction in progress 1.763.384 1.159.037 (497.610) - - (299.874) 2.124.937
@ 86.414.406 2.123.240 (950.265) (177.018) (14.935) (7.520.309) 79.875.119
@ @ @ @ @ @ @ @
Accumulated depreciation
and impairment (-) @ @ @ @ @ @ @
Land improvements and (6.368.316) (108.305) 29.286 214 - 478.618 (5.968.503)
buildings
Machinery and equipment (25.892.360) (443.179) 123.776 6.632 - 1.900.890 (24.304.241)
Vehicles (649.946) (17.540) - 4.283 - 60.016 (603.187)
Furniture and fixtures (1.064.856) (10.892) 19.030 1.931 - 93.810 (960.977)
Other tangibles (13.514.109) (472.499) 3.837 86.297 - 802.835 (13.093.639)
Leasehold improvements (173.565) (147) 3.444 - - 24.156 (146.112)
@ (47.663.152) (1.052.562) 179.373 99.357 - 3.360.325 (45.076.659)
Net book value 38.751.254 1.070.678 (770.892) (77.661) (14.935) (4.159.984) 34.798.460

(*) Coolers and returnable bottles are followed in other tangible assets.

(**)As of March 31, 2023 intangible assets amounting to TL 1.279 transfered to tangible assets.

(***) Spare parts with a net book value of TL 772.171 as of 31 March 2023 have been transferred to inventories.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

12. PROPERTY, PLANT AND EQUIPMENT (continued)

Right of Use Asset

As of March 31, 2024 and 2023, right of use asset movement tables are as follows:

@ January 1,
2024
Additions Changes Disposals Acquired
through
business
combination
Currency
Translation
Difference
March 31, 2024
@ @ @ @ @ @ @
Cost @ @ @ @ @ @
Land and Buildings 607.536 3.846 1.114 - 21.580 (39.846) 594.230
Machinery and Equipment 59.497 - - - - (5.324) 54.173
Vehicles 426.156 11.252 - (11.525) - (39.804) 386.079
Furniture and Fixtures 3.435 - - - - (119) 3.316
@ 1.096.624 15.098 1.114 (11.525) 21.580 (85.093) 1.037.798
@ @ @ @ @ @ @
Amortization @ @ @ @ @ @
Land and Buildings (263.665) (14.742) - - - 12.491 (265.916)
Machinery and Equipment (27.818) (1.986) - - - 1.399 (28.405)
Vehicles (177.994) (34.438) - 11.350 - 15.999 (185.083)
Furniture and Fixtures (3.300) (85) - - - 73 (3.312)
@ (472.777) (51.251) - 11.350 - 29.962 (482.716)
@ @ @ @ @ @ @
Net book value 623.847 (36.153) 1.114 (175) 21.580 (55.131) 555.082
@ January 1,
2023
Additions Changes Currency
Disposals
Translation
Difference
March 31,
2023
@ @ @ @ @ @ @
Cost @ @ @ @ @ @
Land and Buildings 500.449 177.698 3.698 - (88.214) 593.631
Machinery and Equipment 69.644 - - - (13.095) 56.549
Vehicles 609.960 11.436 - (45.467) (65.305) 510.624
Furniture and Fixtures 2.691 - - (1.136) (275) 1.280
@ 1.182.744 189.134 3.698 (46.603) (166.889) 1.162.084
@
Amortization
Land and Buildings (222.317) (13.566) - - 26.011 (209.872)
Machinery and Equipment (30.226) (1.982) - - 4.275 (27.933)
Vehicles (174.891) (43.497) - 29.840 17.699 (170.849)
Furniture and Fixtures (2.890) (82) - 1.136 180 (1.656)
@ (430.324) (59.127) - 30.976 48.165 (410.310)
@
Net book value 752.420 130.007 3.698 (15.627) (118.724) 751.774

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

13. INTANGIBLE ASSETS

As of March 31, 2024 and 2023, intangible assets movement tables are as follows:

@ January 1,
2024
Additions/
(Amortization)
Disposals Acquired
through
business
combination
Transfers Currency
translation
adjustment
March 31,
2024
@ @ @ @ @ @ @ @
Cost
Water sources usage right 357.192 - - - -
-
357.192
Bottlers and distribution
agreements
20.240.074 - - - -
(799.478)
19.440.596
Foundation and organization 19.670 - - - -
-
19.670
Other Rights 2.734.749 21.472 - 86.316 56.712 (60.026) 2.839.223
Construction in progress 732.176 78.970 - (86.316) -
-
724.830
@ 24.083.861 100.442 - - 56.712 (859.504) 23.381.511
Less: Accumulated
amortization
@
@
@
@
@
@
@
@
@
@
@
@
@
@
Water sources usage right (357.192) - - - -
-
(357.192)
Foundation and organization (4.851) (1.953) - - -
-
(6.804)
Other Rights (1.514.217) (67.136) - - (56.712) 128.061 (1.510.004)
@ (1.876.260) (69.089) - - (56.712) 128.061 (1.874.000)
@ @ @ @ @ @ @ @
Net book value 22.207.601 31.353 - - -
(731.443)
21.507.511
@ Currency
January 1, Additions/ translation
2023 (Amortization) Disposals Transfers8*9 adjustment March 31, 2023
@ @ @ @ @ @ @
Cost @ @ @ @ @ @
Water sources usage right 357.191 - - - - 357.191
Bottlers and distribution 21.335.799 - - - (1.776.284) 19.559.515
agreements
Other Rights 2.415.765 21.331 - 8.420 (128.084) 2.317.432
Construction in progress 374.768 14.069 - (9.889) - 378.948
@ 24.483.523 35.400 - (1.469) (1.904.368) 22.613.086
@ @ @ @ @ @ @
Less: Accumulated
amortization @ @ @ @ @ @
Water sources usage right (357.191) - - - - (357.191)
Other Rights (1.107.155) (56.279) - 190 23.382 (1.139.862)
@ (1.464.346) (56.279) - 190 23.382 (1.497.053)
@ @ @ @ @ @ @
Net book value 23.019.177 (20.879) - (1.279) (1.880.986) 21.116.033

There is no water sources usage right purchased by government incentive.

(*) As of March 31, 2023, intangible assets with a net book value of 1.279 TL have been transferred to tangible assets.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

14. GOODWILL

As of March 31, 2024, and 2023 movements of goodwill are as follows:
@
Acquired
through
January 1,
2024
business
combination
Currency
Translation
Difference
March 31, 2024
@
Cost
@
5.922.288
284.960 @
(163.722)
@
6.043.526
Impairment reserve (577.543) - (48.546) (626.089)
Net book value
@
5.344.745 284.960 (212.268) 5.417.437
January 1, 2023 Currency
Translation Difference
March 31, 2023
@
Cost
@
6.609.821
@
(953.313)
@
5.656.508
Impairment reserve (524.919) 50.189 (474.730)
Net book value 6.084.902 5.181.778
@ Domestic International Consolidated
@ @ @ @
March 31, 2024 - 5.417.437 5.417.437
March 31, 2023 - 5.181.778 5.181.778

15. GOVERNMENT INCENTIVES

The Group's earnings from investments tied to an incentive certificate are subject to corporate tax at discounted rates, starting from the accounting period in which the investment is partially or fully operational, until the investment contribution amount is reached. In this context, tax advantage amounting to TL 855.579 (December 31, 2023: TL 947.436) that the Group's will benefit from in the foreseeable future as of March 31, 2024 is reflected in the consolidated financial statements as a deferred tax asset. As a result of the recognition of the said tax advantage as of 31 March 2024, deferred tax expense amounting to TL 91.857 has been realized in the consolidated profit or loss statement for the period from January 1 to March 31, 2024.

According to the tax incentive certificates summarized above, the current period corporate tax provision 1.832 TL (31 March 2023: None) discounted corporate tax advantage has been used and this amount has been deducted from the deferred tax asset.

Deferred tax assets are recognized when it is determined that taxable income is likely to occur in the coming years. In cases where taxable income is likely to occur, deferred tax assets are calculated over deductible temporary differences, tax losses and tax advantages vested in indefinite-lived investment incentives that allow reduced corporate tax payments. In this context, the Group's bases the reflection of deferred tax assets arising from investment incentives in the consolidated financial statements on long-term plans and evaluates the recoverability of deferred tax assets related to these investment incentives as of each balance sheet date, based on business models that include taxable profit estimations. It is foreseen that the deferred tax assets in question will be recovered within 5 years from the balance sheet date.

In the sensitivity analysis carried out as of March 31, 2024, when the inputs in the basic macroeconomic and sectoral assumptions that make up the business plans are increased/decreased by 10%, the recovery period of deferred tax assets regarding investment incentives, which is foreseen as 5 years, has not changed.

The Group capitalizes the R&D expenditures it has made within the scope of the law numbered 5746 in its tax books. The Group makes calculations over the R&D expenditures in accordance within the framework of the relevant legislation and take benefits from the R&D discount according to law's permission. As of March 31, 2024, the Group took advantage of R&D deduction amounting to TL 1.484 (31 March 2023: None)

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

16. PROVISIONS, CONTINGENT ASSETS and LIABILITIES

CCI and its Subsidiaries in Türkiye

Litigations against the Group

CCI and subsidiaries in Türkiye are involved on an ongoing basis in 231 litigations arising in the ordinary course of business as of March 31, 2024 with an amount of TL 31.853 (December 31, 2023 – 229 litigations, TL 22.171). As of March 31, 2024, 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.

Subsidiaries and joint ventures operating in foreign countries

Litigations against the Group

As of March 31, 2024, CCBPL has tax litigations. If the claims are resulted against CCBPL, the tax liability would be TL 92.839 (December 31, 2023 – 96.249).

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.

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.

Pakistani tax administration had previously requested additional taxes from CCBPL, citing the cancellation decision and requesting the "Sales and Excise Taxes" system to be applied retroactively before the cancellation. Company Management objected and litigated this request, since withdrawal decisions of constitutional court could not be applied retrospectively in principle also on the basis that the "Capacity Tax" implementation obligations in force in the relevant time period were fully fulfilled. As of March 31, 2024, the relevant matter has been closed between the Company and the Tax office.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

16. PROVISIONS, CONTINGENT ASSETS and LIABILITIES (continued)

As of March 31, 2024, and 31 December 2023 total guarantees and pledges given by the Group are as follows:

@ March 31, 2024
@ Original
Original
Original
Original
Other Foreign
Total TL TL USD in EUR in PKR in Currency TL
Equivalent Amount Thousands Thousands Thousands Equivalent
@ @ @ @ @ @ @
A. Total guarantees and pledges given by the Company
for its own corporation
2.286.230 1.699.687 7.660 5.975 162.152 112.457
B. Total guarantees and pledges given by the Company
for its subsidiaries consolidated for using the full
consolidation method
10.479.164 549.788 76.263 54.667 16.800.000 3.613.121
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 Group
for other group companies which are not covered in B
and C clauses - - - - - -
iii. Total guarantees and pledges given by the
Company for other third parties which are not
covered in the C clause - - - - - -
Total guarantees and pledges 12.765.394 2.249.475 83.923 60.642 16.962.152 3.725.578
Other guarantees and pledges given / Total equity
(%) - - - - - -
@ December 31, 2023
@ Original Original Original Other Foreign
Total TL TL USD in EUR in Original PKR Currency TL
Equivalent Amount Thousands Thousands in Thousands Equivalent
@ @ @ @ @ @ @
A. Total guarantees and pledges given by the Company
for its own corporation
2.269.640 1.662.846 8.468 4.863 162.152 118.202
B. Total guarantees and pledges given by the Company
for its subsidiaries consolidated for using the full
consolidation method
11.309.906 13.342 76.263 79.198 16.800.000 3.725.885
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 Group
for other group companies which are not covered in B
and C clauses - - - - - -
iii. Total guarantees and pledges given by the
Company for other third parties which are not
covered in the C clause - - - - - -
Total guarantees and pledges 13.579.546 1.676.188 84.731 84.061 16.962.152 3.844.087
Other guarantees and pledges given / Total equity

(%) - - - - - -

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 Türkiye 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.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

17. COMMITMENTS

Murabaha

CCBPL has signed Murabaha facility agreements with Habib Bank Limited and Standard Chartered Bank ("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, 2024, CCBPL has a commitment to purchase sugar and resin in the amount of 77.5 million USD from the Banks by the end of June 30, 2024, and sugar and resin in the amount of 42.9 million USD by the end of September 30, 2024.

CCBPL has signed Murabaha facility agreements with Habib Bank Limited and Standard Chartered Bank ("Banks"). Based on these agreements, the Banks and CCBPL agree that they shall enter into a series of sugar and resin purchase transactions. As of December 31, 2023, CCBPL has a commitment to purchase 74.1 million USD of sugar and resin from the Banks by the end of 31 March 2024, and 37.6 million USD of sugar and resin by the end of 30 June 2024.

18. OTHER ASSETS AND LIABILITIES

a) Other Current Assets

@ March 31, 2024 December 31, 2023
@
@
@
VAT receivables 2.666.305 1.432.561
Other 374.979 366.653
@ 3.041.284 1.799.214
b)
Other Current Liabilities
@ March 31, 2024 December 31, 2023
@
@
@
Put option of share from non-controlling interest 76.194 79.940
Other 74.887 74.481
@ 151.081 154.421

As of March 31, 2024, the obligation of TL 76.194 results from the put 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 Türkiye and booked under put option of share from non-controlling interest under other current liabilities (December 31, 2023-TL 79.940).

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

19. EQUITY

Share Capital

March 31, 2024 December 31, 2023
Common shares 1 Kr par value
Authorized and issued (units) 25.437.078.200 25.437.078.200

Legal reserves

The legal reserves consist of first and second legal reserves, appropriated in accordance with the Turkish Commercial Code. The first legal reserve is appropriated out of historical statutory profits at the rate of 5% per annum, until the total reserve reaches 20% of the historical paid-in share capital. The second legal reserve is appropriated after the first legal reserve and dividends, at the rate of 10% per annum of all cash dividend distributions.

Listed companies distribute dividend in accordance with the communique No. II-19.1 issued by the CMB which is effective from February 1, 2014.

Companies distribute dividends in accordance with their dividend payment policies settled and dividend payment decision taken in general assembly and also in conformity with relevant legislations. The communique does not constitute a minimum dividend rate. Companies distribute dividend in accordance with the method defined in their dividend policy or articles of incorporation. In addition, dividend can be distributed by fixed or variable instalments and advance can be paid in accordance with profit on financial statements of the Group.

Inflation adjustment to shareholders' equity can only be netted-off against prior years' losses and used as an internal source for capital increase where extraordinary reserves can be netted-off against prior years' loss and used in the distribution of bonus shares and dividends to shareholders. In case inflation adjustment to issued capital is used as dividend distribution in cash, it is subject to corporation tax.

As of March 31, 2024 breakdown of the equity in the financial statements of CCI prepared in accordance with the Tax Procedure Law are as follows.

31 March 2024
PPI Indexed Legal Records CPI Indexed Records Amounts followed in
Accumulated Profit /
Loss
Share Capital Adjustment Differences
Share Premium
Restricted Reserves Allocated from Net Profit
6.504.256
-
1.977.287
3.710.396
3.131.953
2.348.707
2.793.860
(3.131.953)
(371.420)

Dividends

According to our company's consolidated financial statements prepared in accordance with CMB accounting standards, the net profit for the 2023 fiscal year was 20,579,819 TL. After deducting legal obligations, our Board of Directors has submitted to the General Assembly that a total gross amount of 2,000,015 TL will be distributed to the partners as of May 27, 2024, to be covered entirely from the 2023 net period profit, and the remaining part of the 2023 net period profit will be left within our Company as an extraordinary reserve. The proposal was approved in General Assembly.

Entities which are Türkiye resident taxpayers or entitled such dividends through a permanent establishment or a permanent representative in Türkiye, will be paid a gross cash dividend of TL 7,8626 (net TL 7,8626) per 100 shares, representing TL 1 nominal value. While other shareholders will receive gross TL 7,8626 (net TL 7,07634) per 100 shares.

No privilege is granted to any share group regarding dividend distribution.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

20. OTHER INCOME/EXPENSE

a) Other operating income / expense March 31, 2024 March 31, 2023
@
@
@
Other operating income
@
@
Foreign exchange gain 347.118 297.582
Gain on sale of scrap materials 85.711 95.001
Insurance income 11.246 4.466
Reversals from provision 5.279 1.764
Reversals from inventory provision 25.814 3.092
Other income 188.337 80.611
@ 663.505 482.516
@
@
@
Other operating expense @ @
Foreign exchange loss (263.311) (281.958)
Loss on sale of scrap materials (87.441) (71.997)
Donations (14) (27.830)
Other expenses (262.165) (64.508)
(612.931) (446.293)
b) Gain / (Loss) from Investing Activities March 31, 2024 March 31, 2023
@
@
@
Gain from Investing Activities @ @
Impairment reversal of property, plant and equipment (Note 12) 4.455 2.182
Gain on disposal of property, plant and equipment, net - 40.291
@ 4.455 42.473
@
@
@
Loss from Investing Activities @ @
Loss on disposal of property, plant and equipment, net (15.374) -
Provision for impairment in property, (5.482) (17.117)
plant and equipment (Note 12)
@ (20.856) (17.117)

21. FINANCIAL INCOME / EXPENSE

@ March 31, 2024 March 31, 2023
@
@
@
Foreign exchange gain 856.438 1.484.279
Interest income 321.630 203.862
Derivative transaction gain 88.473 216.083
@ 1.266.541 1.904.224
@ March 31, 2024 March 31, 2023
@
@
@
Foreign exchange loss (556.588) (1.770.383)
Interest expense (1.832.460) (862.824)
Interest expense of lease liabilities (20.611) (28.107)
Derivative transaction loss (1.916) (10.794)
@ (2.411.575) (2.672.108)

As of March 31, 2024, and 2023 foreign exchange gain (loss) from foreign currency denominated borrowings are as follows:

@ March 31, 2024 March 31, 2023
Foreign exchange gain / (loss) from foreign (2.386.000) (1.223.255)
currency denominated borrowings, net

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

22. TAX RELATED 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 Türkiye, 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 Türkiye, the corporate tax rate is 25% as of March 31, 2024 (December 31, 2023: 25%). The corporate tax rate is applied to the profit after adding nondeductible expenses, exceptions and discounts accepted by the tax laws. Different corporate tax rates of foreign subsidiaries are as follows:

March 31, 2024 December 31, 2023
Kazakhstan 20% 20%
Azerbaijan 20% 20%
Kyrgyzstan 10% 10%
Turkmenistan 8% 8%
Tajikistan 18% 18%
Jordan 21% 20%
Iraq 15% 15%
Pakistan 39% 39%
Bangladesh 27,5% -
Uzbekistan 15% 15%

For the consolidated financial statements, subsidiaries financial statements have been translated 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, 2024, and 31 December, 2023 using the prevailing effective statutory tax rate is as follows:

@ March 31, 2024@ December 31, 2023
@ Cumulative Deferred Cumulative Deferred
Temporary Tax Assets / Temporary Tax Assets /
Difference (Liabilities) Difference (Liabilities)
@ @ @ @ @
Tangible and intangible assets (21.078.179) (5.203.750) (19.170.096) (5.191.216)
Right of use asset 24.608 6.151 (56.305) (14.546)
Borrowings (679.227) (169.807) (664.854) (166.213)
Employee termination, other employee benefits and other
payable accruals
157.291 36.790 93.817 23.455
Unused investment incentive 559.989 855.579 644.529 947.436
Carry forward tax loss 4.579.858 1.144.965 14.798.074 3.699.518
Trade receivables, payables and other 5.494.533 1.291.236 3.144.468 723.145
Derivative financial instruments (252.620) (82.632) (134.168) (37.231)
Inventory (366.853) (72.122) (68.889) (144.438)
@ (11.560.600) (2.193.590) (1.413.424) (160.090)
Minus: Provision for valuation of carry forward loss (4.579.858) (1.144.965) (14.798.074) (3.699.518)
@ (16.140.458) (3.338.555) (16.211.498) (3.859.608)
Deferred tax assets @ 1.070.761 668.150
Deferred tax liabilities @ (4.409.316) (4.527.758)
@ @
Deferred tax liability, net @ (3.338.555) (3.859.608)

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

22. TAX RELATED ASSETS AND LIABILITIES (continued)

The expiration dates of carryforward tax losses for which no deferred taxes are calculated as follows;

@ March 31, 2024 December 31, 2023
@ @ @
2024 46.464 53.463
2025 75.718 87.124
2026 1.958.417 2.630.735
2027 2.499.259 3.540.148
2028 - 8.486.604
@ 4.579.858 14.798.074

As of March 31, 2024, and 2023, the movement of net deferred tax liability is as follows:

@ March 31, 2024 March 31, 2023
@ @
@
Balance at January 1, 3.859.608 5.347.972
Deferred tax expense / (income) 146.078 (17.665)
Tax expense recognized in comprehensive income (478.323) (96.489)
Additions through subsidiary acquisition 162 -
Currency translation adjustment (188.970) (547.863)
3.338.555 4.685.955

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 year. The Company has no diluted instruments. As of March 31, 2024, and 2023 earnings / (losses) per share is as follows:

@ March 31, 2024 March 31, 2023
@ @ @
Equity holders net income/(loss) for the period 2.715.874 3.180.313
Weighted average number of ordinary shares 25.437.078.200 25.437.078.200
Equity Holders Earnings Per Share (Full Tl) 0,106768 0,125027

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, 2024@
@ Sales to related
parties and
other
revenues
Purchases from
related parties
and
other expenses
Receivables
from related
parties
Payables to
related parties
@ @ @ @ Short Term Long Term
Related Parties and Shareholders @ @ @ @ @
Anadolu Group Companies (1) 546.379 181.858 669.026 59.315 -
The Coca-Cola Company (1) 66.679 6.612.832 424.320 10.947.956 -
Özgörkey Holding Group Companies (1) 238 25.153 - 15.878 -
Syrian Soft Drink Sales and - - 49.771 -
Distribution L.L.C (4) -
Day Trade (2) - - - 168.963 -
National Beverage Co. (3) - 8.618 - - -
Other - 66.177 - - -
Total 613.296 6.894.638 1.143.117 11.192.112 -

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

24. RELATED PARTY BALANCES AND TRANSACTIONS (continued)

March 31, 2023 December 31, 2023
Purchases
Sales to related from related Receivables
parties and other parties and from related
revenues other expenses parties Payables to related parties
Related Parties and Shareholders Short Term Long Term
Anadolu Group Companies (1) 428.082 37.055 566.688 112.718 -
The Coca-Cola Company (1) 289.441 7.914.311 751.796 8.814.824 -
Özgörkey Holding Group Companies (1) 950 22.049 468 10.615 -
Syrian Soft Drink Sales and Distribution - - 49.665 -
L.L.C (4) -
Day Trade (2) - - - 177.270 -
National Beverage Co. (3) - 8.859 - - -
Other - 37.087 - - -
Total 718.473 8.019.361 1.368.617 9.115.427 -

(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, 2024, and 2023, purchases from related parties and significant portion of other expenses consist of services obtained, fixed asset and raw material purchases and toll production.

As of March 31, 2024, and 2023, 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, 2024, and 31 December 2023, 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, 2024 December 31, 2023@
@ Board of Executive Board of Executive
Directors Directors Directors Directors
@ @ @ @ @
Short-term employee benefits 567 41.252 2.362 94.479
Other long-term benefits - 9.244 - 2.864
@ 567 50.496 2.362 97.343
Number of top executives 4 9 4 10

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, and credit 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.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

25. NATURE AND LEVEL OF RISKS ARISING FROM 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 adjusts it considering 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, 2024, and December 31, 2023, debt to equity ratio, obtained by dividing the total net debt, the financial borrowings and loan debts minus cash and cash equivalents and short-term financial assets, to share capital is as follows:

@ March 31, 2024 December 31, 2023
@ @ @
Borrowings 41.066.174 42.619.226
@
Less: Cash and cash equivalents and short-term financial assets
@
(19.265.473) (25.464.153)
Net debt 21.800.701 17.155.073
@
Total share capital 254.371 254.371
@
Net debt / Total equity ratio (%) 85,70 67,44

(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, 2024, 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, 2024, which is the following reporting period would be:

@ March 31, 2024 March 31, 2023
@
Increase / decrease of 1% interest in U.S. Dollar denominated
borrowing interest rate
@
48
@
145
Increase / decrease of 1% interest in Euro denominated borrowing
interest rate
4.797 6.130
Increase / decrease of 1% interest in Pakistan Rupee denominated
borrowing interest rate
740 20
Total 5.585 6.295

As of March 31, 2024, and 2023, the analysis of financial assets of the Group exposed to interest risk as follows:

Interest Rate Risk March 31, 2024 March 31, 2023
@ @
@
Financial instruments with fixed interest rate
Time deposits 13.241.285 19.576.330
Financial liabilities (Note 8) 37.581.032 34.964.424
Financial instruments with floating interest rate @
Financial liabilities (Note 8) 2.792.875 2.673.298

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

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

(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 and by using derivate financial instruments (Note 7).

@ March 31, 2024 March 31, 2023
@ @
@
Total export 36.017 49.708
Total import 7.236.109 7.127.290

Foreign Currency Position

As of March 31, 2024, and December 31, 2023, the foreign currency position (except functional currency) of the Group and its subsidiaries is as follows:

Foreign Currency Position Table
March 31, 2024
@ Other Foreign
Currency TL
Total TL Equivalent USD Euro Equivalent
@
1. Trade Receivables and Due from Related
Parties
@
843.630
@
19.059
@
6.560
@
-
2a. Monetary Financial Assets (Cash and cash
equivalents included)
3.231.762 74.382 23.855 100
2b. Non-monetary Financial Assets 16.621 61 421 -
3. Other Current Assets and Receivables 24.735 761 3 62
4. Current Assets (1+2+3) 4.116.748 94.263 30.839 162
5. Trade Receivables and Due from Related
Parties
- - - -
6a. Monetary Financial Assets - - - -
6b. Non-monetary Financial Assets - - - -
7. Other 513.808 752 14.066 -
8. Non-Current Assets (5+6+7) 513.808 752 14.066 -
9. Total Assets (4+8) 4.630.556 95.015 44.905 162
10. Trade Payables and Due to Related Parties 4.873.169 132.173 16.032 39.262
11. Short-term Borrowings and Current Portion 6.986.859 162.993 49.192 -
of Long - term Borrowings
12a. Monetary Other Liabilities 247.733 7.446 198 -
12b. Non-monetary Other Liabilities - - - -
13. Current Liabilities (10+11+12) 12.107.761 302.612 65.422 39.262
14. Trade Payables and Due to Related Parties - - - -
15. a Long-Term Borrowings 17.257.312 500.211 30.939 -
15. b. Long-Term Lease Payables 120.976 2.574 1.082 -
16 a. Monetary Other Liabilities - - - -
16 b. Non-monetary Other Liabilities - - - -
17. Non-Current Liabilities (14+15+16) 17.378.288 502.785 32.021 -
18. Total Liabilities (13+17) 29.486.049 805.397 97.443 39.262
19. Off Balance Sheet Derivative Items' Net 21.320.366 659.200 - -
Asset / (Liability) Position (19a-19b)
19a. Total Hedged Assets (*) 21.320.366 659.200 - -
19b. Total Hedged Liabilities - - - -
20. Net Foreign Currency Asset / (Liability) (3.535.127) (51.182) (52.538) (39.100)
Position (9-18+19)
21. Monetary Items Net Foreign Currency (25.410.657) (711.956) (67.028) (39.162)
Asset / (Liability) Position (TFRS 7, B23)
(=1+2a+5+6a-10-11-12a-14-15-16a)
22. Total Fair Value of Financial Instruments
Used to Manage the Foreign Currency - - - -
Position

(*)In order to hedge the exchange rate risk arising from the conversion of net investments in subsidiaries operating in the Netherlands into Turkish Lira, bonds issued in USD have been designated as a net investment hedging instrument.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

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

Foreign Currency Position (continued)

Foreign Currency Position Table
December 31, 2023
@ Total TL Equivalent USD Euro Other Foreign
Currency TL
Equivalent
@ @
@
@ @
1. Trade Receivables and Due from Related
Parties
862.364 18.936 5.895 -
2a. Monetary Financial Assets (Cash and cash
equivalents included)
4.085.068 98.018 20.364 1.667
2b. Non-monetary Financial Assets - - - -
3. Other Current Assets and Receivables 275.337 7 7.335 178
4. Current Assets (1+2+3) 5.222.769 116.961 33.594 1.845
5. Trade Receivables and Due from Related
Parties
- - - -
6a. Monetary Financial Assets - - - -
6b. Non-monetary Financial Assets - - - -
7. Other 88.628 170 2.211 -
8. Non-Current Assets (5+6+7) 88.628 170 2.211 -
9. Total Assets (4+8) 5.311.397 117.131 35.805 1.845
10. Trade Payables and Due to Related Parties 5.679.510 140.602 23.128 39.921
11. Short-term Borrowings and Current Portion 8.495.518 162.999 78.947 -
of Long - term Borrowings
12a. Monetary Other Liabilities 84.867 2.491 9 -
12b. Non-monetary Other Liabilities - - - -
13. Current Liabilities (10+11+12) 14.259.895 306.092 102.084 39.921
14. Trade Payables and Due to Related Parties - - - -
15. a Long-Term Borrowings 18.583.150 499.911 43.124 -
15. b. Long-Term Lease Payables 133.863 2.804 1.031 -
16 a. Monetary Other Liabilities - - - -
16 b. Non-monetary Other Liabilities - - - -
17. Non-Current Liabilities (14+15+16) 18.717.013 502.715 44.155 -
18. Total Liabilities (13+17) 32.976.908 808.807 146.239 39.921
19. Off Balance Sheet Derivative Items' Net 22.368.644 659.200 - -
Asset / (Liability) Position (19a-19b)
19a. Total Hedged Assets (*) 22.368.644 659.200 - -
19b. Total Hedged Liabilities - - - -
20. Net Foreign Currency Asset / (Liability) (5.296.867) (32.476) (110.434) (38.076)
Position (9-18+19)
21. Monetary Items Net Foreign Currency (28.029.476) (691.853) (119.980) (38.254)
Asset / (Liability) Position (TFRS 7, B23)
(=1+2a+5+6a-10-11-12a-14-15-16a)
22. Total Fair Value of Financial Instruments
Used to Manage the Foreign Currency - - - -
Position

(*) In order to hedge the exchange rate risk arising from the conversion of net investments in subsidiaries operating in the Netherlands into Turkish Lira, bonds issued in USD have been designated as a net investment hedging instrument.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

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

Foreign Currency Position (continued)

The following table demonstrates the sensitivity of the Group's profit before tax to a reasonably possible change in the USD, EUR, and other foreign currency denominated exchange rates against TL by 20%, with all other variables held constant.

@Foreign Currency Position Sensitivity Analysis
@ March 31, 2024 March 31, 2023
@ Income / Income / Income / Income /
(Loss) (Loss) (Loss) (Loss)
@ Increase of Decrease of Increase of Decrease of
the foreign the foreign the foreign the
currency currency currency foreign
@ @ @ @ @
Changes in the USD against TL by 20%: @ @ @ @
1- USD denominated net asset / (liability) (4.596.368) 4.596.368 (5.492.292) 5.492.292
2- USD denominated hedging instruments (-) 4.264.073 (4.204.668) 5.296.453 (4.978.894)
3- Net effect in USD (1+2) (332.295) 391.700 (195.839) 513.398
@
Changes in the Euro against TL by 20%:
4- Euro denominated net asset / (liability) (366.918) 366.918 (427.777) 427.777
5- Euro denominated hedging instruments (-) - - - -
6- Net effect in Euro (4+5) (366.918) 366.918 (427.777) 427.777
@
Average changes in the other foreign currencies against TL
by 20%:
7- Other foreign currency denominated net asset / (liability) (7.820) 7.820 (10.988) 10.988
8- Other foreign currency hedging instruments (-) - - - -
9- Net effect in other foreign currency (7+8) (7.820) 7.820 (10.988) 10.988
TOTAL (3+6+9) (707.033) 766.438 (634.604) 952.163

(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.

As of 31 March 2024, the Group has fulfilled its financial commitments arising from its borrowings.

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

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

(d) Credit Risk (continued)

Credit risk exposure from financial instruments as of March 31, 2024, and December 31, 2023 are as follows:

Receivables @ @
Trade Receivables
and Due from Other Advances Bank
March 31, 2024@ Related Parties Receivables Given Deposits
@ @ @ @ @
Maximum credit risk exposure as of reporting date 17.382.850 315.691 2.423.107 19.156.647
(A+B+C+D+E)
- Maximum risk secured by guarantee 11.529.557 - 570.265 -
A. Net book value of financial assets neither overdue nor 15.479.374 315.691 2.423.107 19.156.647
impaired
B. Net book value of financial assets of which conditions - - - -
are negotiated, otherwise considered as impaired or
overdue
C. Net book value of assets overdue but not impaired 1.903.476 - - -
-Under guarantee 755.432 - - -
D. Net book value of impaired assets - - - -
- Overdue (gross book value) 364.335 - - -
- Impairment (-) (364.335) - - -
- Net value under guarantee - - - -
- Not overdue (gross book value) - - - -
- Impairment (-) - - - -
- Net value under guarantee - - - -
E. Off- balance sheet items having credit risk - - - -
Receivables
Trade Receivables
and Due from Other Advances Bank
December 31, 2023 Related Parties Receivables Given Deposits
Maximum credit risk exposure as of reporting date
(A+B+C+D+E)
10.142.314 293.928 2.051.473 25.426.631
- Maximum risk secured by guarantee 7.118.942 - 686.907 -
A. Net book value of financial assets neither overdue nor
impaired
8.966.801 293.928 2.051.473 25.426.631
B. Net book value of financial assets of which conditions
are negotiated, otherwise considered as impaired or
overdue
- - - -
C. Net book value of assets overdue but not impaired 1.175.513 - - -
-Under guarantee 336.669 - - -
D. Net book value of impaired assets - - - -
-
Overdue (gross book value)
273.255 - - -
-
Impairment (-)
(273.255) - - -
-
Net value under guarantee
- - - -
-
Not overdue (gross book value)
- - - -
-
Impairment (-)
- - - -
-
Net value under guarantee
- - - -
E. Off- balance sheet items having credit risk - - - -

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

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

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

Based on a 12-month anticipated purchase of can, the Group hedges using commodity (aluminum) swap contracts (Note 7).

Based on a 15-month anticipated purchase of pet, the Group hedges using commodity (resin) swap contracts (Note 7).

Based on a 24-month anticipated production, the Group hedges using commodity (sugar) swap contracts (Note 7).

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 bad debt are estimated to be at their fair values.

Financial Liabilities The fair values of trade payables and other monetary liabilities are estimated to approximate carrying values, 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.

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 contain observable market inputs

COCA-COLA İÇECEK ANONİM ŞİRKETİ

Notes to Interim Condensed Consolidated Financial Statements as at March 31, 2024

(Amounts expressed in thousands of TL based on the purchasing power of Turkish Lira ("TL") as of March 31, 2024, unless otherwise stated)

26. FINANCIAL INSTRUMENTS (continued)

March 31, 2024 Level 1 Level 2 Level 3
@ @ @ @
a) Assets presented at fair value @ @ @
Derivative financial instruments - 238.608 -
Total assets - 238.608 -
@ @ @ @
b) Liabilities presented at fair value @ @ @
Derivative financial instruments - 228.713 -
Put option of share from non-controlling interest - - 76.194
Total liabilities - 228.713 76.194
December 31, 2023 Level 1 Level 2 Level 3
a) Assets presented at fair value
Derivative financial instruments - 201.210 -
Total assets - 201.210 -
b) Liabilities presented at fair value
Derivative financial instruments - 323.743 -
Buying option of share from non-controlling interest - - 79.940
Total liabilities - 323.743 79.940

As of March 31, 2024, and March 31, 2023, the movement of share purchase option below level 3 is as follows;

@
March 31, 2024
March 31, 2023
@
@
@
Balance at January 1st 79.940 83.816
Currency translation difference (3.746) (7.653)
End of period 76.194 76.163

27. EVENTS AFTER BALANCE SHEET DATE

Collective Bargaining Agreement negotiations between our Company and Tek-Gıda İş Sendikası were concluded with an agreement and the agreement is currently at the signing stage. The Collective Bargaining Agreement will be effective for 2 years between 1 January 2024 - 31 December 2025.

According to our company's consolidated financial statements prepared in accordance with CMB accounting standards, the net profit for the 2023 fiscal year was 20,579,819 TL. After deducting legal obligations, our Board of Directors has submitted to the General Assembly that a total gross amount of 2,000,015 TL will be distributed to the partners as of May 27, 2024, to be covered entirely from the 2023 net period profit, and the remaining part of the 2023 net period profit will be left within our Company as an extraordinary reserve. The proposal was approved in General Assembly.

Entities which are Türkiye resident taxpayers or entitled such dividends through a permanent establishment or a permanent representative in Türkiye, will be paid a gross cash dividend of TL 7,8626 (net TL 7,8626) per 100 shares, representing TL 1 nominal value. While other shareholders will receive gross TL 7,8626 (net TL 7,07634) per 100 shares.

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