Central Missouri State University

Discussion Topics

• History of Coca-Cola • Development of Coca-Cola

Enterprises• Products of Coca-Cola• Benefit Administration Overview• Development of OneSource• Benefits Overview• 401(k) Plan Review

Did you know...• One of every three soft drinks consumed in the United States bears

the Coca-Cola trademark, and about half of all colas consumed carry the Coke name

• During 1886, sales of Coca-Cola averaged nine drinks per day (total, not per person). Most recently, sales of Coca-Cola products were more than 411 million drinks per day (total, not per person)

• If all of the Coca-Cola ever produced was in normal bottles placed end-to-end, they would wrap the earth 4,712 times.

• If the Coca-Cola vending machines in the US were stacked one on top of another, the pile would be over 450 miles high.

• The slogan "Good to the Last Drop" was first used by the Coca-Cola Company in 1908. It later became the slogan for Maxwell House coffee.

• Coca-Cola is available in more than 185 countries and asked for in more than 80 languages.

• CCE produces 3.2 billion cases of Coke products each year.

Important People

in

Coca-Cola’s History

John Pemberton

Frank Robinson

Benjamin Thomas & Joseph

Whitehead

Designers

Important Dates

• 1886- John Pemberton created Coca-Cola Syrup

• 1888- Coca-Cola Company purchased for $2,300 by Asa Candler

• 1901- First bottling franchise formed• 1915- Contour bottle developed• 1919- The Coca-Cola Company was sold for

$25MM• 1921- Over 1,000 bottling plants now in

existence• 1959- 12 ounce can introduced• 1960’s TAB, Fresca and Sprite introduced• 1970’s Bulk syrup tanks introduced

Important Dates

• 1982- Diet Coke introduced• 1983- New caffeine free versions introduced• 1985- Introduction of the new Coke- Months

later, Coca-Cola Classic was RE-introduced• Late 1980’s - Number of independent

Coca-Cola franchise ownerships in the U.S. down to 180

• Late 1980’s - Minute Maid Soda introduced • 1994 - Nationwide introduction of POWERADE• Late 1990’s - Fewer than 120 Coca-Cola

bottlers exist in the U.S.

The Development of

History of CCE

• 1970- Bottling franchise ownership began to consolidate

• 1986- Lupton franchises and BCI Holding Corporation’s bottling holdings merged to form Coca-Cola Enterprises

History of CCE• November 21, 1986- Coca-Cola

Enterprises offered stock to the public under the NYSE symbol “CCE”

History of CCE• 1991- CCE merged with Johnston

Coca-Cola

History of CCE• 1993- CCE Expanded into the Netherlands, and

smaller sales centers

• 1996- CCE made more acquisitions in the Southeast and Midwest U.S., Belgium, and France. CCE began acquisitions in England, Scotland, and Wales

History of CCE

• 1997- CCE acquired Coke New York, Coke Southwest, and Canadian territories

• 2001- CCE acquired the Herb Group Coca-Cola Bottling Company

History of CCE

Division

AtlantaCanadaCentral StatesDesert MountainEast TexasEastern Great LakesFloridaGulf StatesLakeshoreMid-AmericaMid-AtlanticMidwestNew EnglandNew YorkNorth TexasNorthern CaliforniaNorthwestSouthern CaliforniaSouthern StatesSouthwest TexasTri-State

CCE North American Divisions

CCE Facilities

Cross DockDouble BottomModified Cross DockPlantWet Warehouse

North American Facilities

Major Products of The Coca-Cola Company distributed by CCE in North America

Top Five BrandsCoca-Cola classicdiet Coke Spritecaffeine free diet CokeDasani

Barq's root beer and other flavorscaffeine free Coca-Cola classic Cherry Coke C2Dannon Waterdiet Cherry Coke diet Coke with lemondiet Coke with Limediet Vanilla CokeEvian FantaFrescaFruitopia

Products of Coca-Cola

A&W Canada DryDr Pepper

Dr Pepper - Red Fusiondiet Dr Pepper

EASMendotaNestea

Cool From Nestea diet Nestea

Odwalla Schweppes Seagrams

Simply Orange

Products of Other Companies

Distributed by CCE in North AmericaHi-C fruit drinks

KMXMad RiverManzana MiaMello YelloMinute Maid juices and juice drinksMinute Maid Lemonade and Fruit PunchMinute Maid and diet Minute Maid soft drinks Pibb X-traPOWERadeRed FlashSprite Remix TABVanilla CokeSprite Zero

The Coca-Cola The Coca-Cola CompanyCompany

•Manufacture concentrate•Develop advertising•Provide market support

• Combine concentrate with sweetener and carbonated water• Purchase packaging materials• Produce quality product in can/bottle• Establish wholesale pricing• Lend marketing support to retailer

• Distribute and merchandise the product

• Establish retail pricing - advertised specials• Partners in promotional programs• Develop and manage consumer focused marketing strategies

• Allocate retail shelf and display space

• Purchase and enjoy the product!

RetailerRetailer(Customer(Customer

))

ConsumerConsumer

Benefits Administration

Overview

Benefits Administration

• Benefits Overview– CCE spends in excess of $350M annually to

provide health and welfare and disability benefits to its employees.

• Prior to January 1, 2004– Decentralized administration, 20 plus divisions /

400 plus sales locations– Approximately 168 FTEs deliver decentralized

benefits services– No integration of disability leaves (WC, STD, LTD)

to manage cost– Non-bargaining employees benefits administered

electronically– Bargaining and Retiree benefits administered

manually (i.e. paper enrollments, no data feeds to carriers)

Benefits Administration

• Recommendation– Consolidate Benefits Administration, create

Service Center– Develop Benefits Administration System

for all employees– Outsource STD, LTD and FML

Administration – Create Knowledge Base of Benefit Plans– Project provides 10 year cash flow having

a net present value of $20 million and an Internal Rate of Return of 90%

OneSource Service Center

Overview

OneSource Service Center From the Beginning

• OneSource opened for business on January 2, 2004

• We opened with:– 1 Service Center Manager– 1 Supervisor– 1 Training & Communication Specialist – 1 Administrative Assistant– 8 Case Managers (Tier 2)– 19 Customer Service Representatives

(Tier 1)

OneSource Service Center Types of Requests

• New Hire/Newly Eligible Elections• Annual Enrollment/Contract Negotiations• Family Status Changes• Educational Assistance Requests and

Reimbursements• Adoption Assistance• Pension Requests• Medigap Reimbursements• Life Insurance Claims• Payroll Deduction Questions• Employee Web Assistance• Eligibility Issues• Plan Inquiries

OneSource Service Center January ~ August Metrics

• Total Calls Answered 84,334• % Answered w/in 30 Sec 71%• Average Call Time 390

seconds• % handled at First Point

85.10%• Total Employees who have

used the web at least once 23,100• Total Fulfillment Processed 24,000

Types of Employee Benefits

Overview

Benefits Overview• Core Benefits (Company Paid)

– Life Insurance

– Long-term Disability (LTD)

• Pre-Tax Benefits (Optional)– Medical, Vision and Prescription

Drug

– Dental

• After-Tax Benefits (Optional):– Supplemental Life Insurance

– Dependent Life Insurance

– Employee Assistance Program (EAP)– Manage Your Health (wellness program)

– Healthcare Reimbursement Account

– Dependent Care Reimbursement Account

– Supplemental LTD Insurance

– Supplemental AD&D Insurance

Health Programs

Online Resources

Health Publications

The Manage Your Health Components

NextSteps® Health

Coaching

NextSteps® Health

Coaching

CCEOneSource.comCCEOneSource.com

Specialty Health

Management

Specialty Health

Management

Health Assessment

Health Assessment

NurseLine/ Health Info

Library

NurseLine/ Health Info

LibraryTaking Care Newsletter

Taking Care Newsletter

MatriaCares.com/CCEMatriaCares.com/CCE

Live Nurse Chat

Live Nurse Chat

Coca-Cola Enterprises

ManageYour

Health

healthforums.comhealthforums.com

Taking CareReference

Book

Taking CareReference

Book

Other Employee Programs

• Defined Benefit Pension Plan • Defined Contribution Plan• Deferred Compensation Plan• Retiree Medical • Retiree Life• Educational Assistance• Adoption Assistance• Employee Stock Purchase Plan• Vacation• Paid Holidays• Personal Leaves• Sick Pay

401(k) Plan Overview

Matched Employee Savings

and Investment Plan (MESIP)

MESIP

• Company Matching Contributions

• Save automatically

• Pay less taxes now

• Tax-deferred advantage

• Portability

MESIP

• Saving on pre-tax basis, – Earnings grow tax-sheltered

• Contributions can be either pre-tax or after-tax– Up to 30% pre-taxed

• Pre-tax contributions are limited to a maximum of $14,000 in 2005.

– Up to 10% after-tax

What will it cost? IT ISN’T CHEAP

2003

Cup of coffee $1.25

Postage stamp $0.37

Gallon of gas $1.40

Movie ticket $8.50

Mid-priced car $25,800

Mid-priced home $171,667Sources: Specialty Coffee Association of America; U.S. Postal Service; WEXIndex®; National Association of Theatre Owners; National Automotive Dealers Association; American Housing Survey. Data reflect prices from these sources as of 2003.

Assumes a 3% rate of inflation.

1973

$0.10

$0.08

$0.40

$1.65

$10,346

$27,159

2033

$3.03

$0.90

$3.40

$20.63

$62,623

$416,681

DIFFERENCEINVEST 4%

BEFORE-TAXINVEST 3%

BEFORE-TAX

The result depends on your tax bracket and how much you save in your Plan account. In the example above, the example assumes the standard withholding for a single filer in the 25% tax bracket making $30,000 per year in 2004. Exemptions, itemized deductions, and state taxes are not reflected in this example.

It costs less than you might think

• Bottom line: You will be investing $6.00 more each week, but it will only cost you $4.00

Weekly gross income $577 $577 $0

Before-tax investment $17 $23 $6

Weekly take-home pay $438 $434 -$4

Annual retirement savings $900 $1,200 $300

* Before-tax savings assumes a hypothetical investment of $150 a month invested before-tax with annual returns of 8% compounded monthly with earnings reinvested. After-tax savings assumes a $150 investment taxed at a 25% federal rate for a hypothetical investment of $112.50 per month after-tax with annual returns of 8% compounded monthly with earnings reinvested. Capital gains, exemptions, deductions, and local taxes are not reflected. After-tax returns are subject to a capital gains tax, which was reduced in 2003 and would make the investment return for the taxable investment more favorable. Investors should consider the personal investment horizon and income tax brackets, both current and anticipated when making an investment decision, these may further impact the results of the comparison. The return is shown for illustrative purposes only and is not intended to predict the return of any investment in your plan, which will fluctuate. Regular investing does not ensure a profit or protect against loss in declining markets. Withdrawals are subject to income tax, and those made before age 59½ may be subject to an additional 10% tax.

Tax-deferred advantage

$18,436$51,980

$167,665

$392,738

$113,008

$224,043

$66,265

$20,581

10 years 20 years 30 years 40 years

After-tax saving

Before-tax saving

Fund styles*

* Styles are ranked according to market and credit risk. Market risk measures how sensitive a fund may be to economic and market changes. Market risk is generally higher for funds that invest heavily in stocks. Credit risk measures how susceptible a fund’s income holdings may be to the nonpayment of principal or interest by the issuer. Because blend funds have the flexibility to invest in both growth and value stocks in varying proportions, at any given time they may have a higher or lower risk/reward profile than value funds or growth funds.

Higher risk/higher potential

reward

Lower risk/lower potential

reward

GROWTHGROWTH

BLENDBLEND

INCOMEINCOME

CAPITAL PRESERVATIONCAPITAL PRESERVATION

VALUEVALUE

Your fund choices

Choose from three tiers of funds

Current prospectuses or offering statements for your new fund options were sent to you in a previous mailing. Review them carefully before making any investment decisions.

TIER 1 LifePath portfolios Single-fund

solutions to asset allocation

TIER 2 Core funds Your Plan’s

basic fund lineup

TIER 3 Sector funds Additional

specialized funds

LifePath portfolio lineup

LifePath portfolios are designed to be used as a single-fund solution to asset allocation

Higher risk/longer targeted investment period

Lower risk/shorter targeted investment period

Barclays LifePath 2040

Barclays LifePath 2030

Barclays LifePath 2020

Barclays LifePath 2010

Barclays LifePath Retirement Fund

Coca-Cola Enterprises Stock Fund (nondiversified fund)

50/50 Fund (nondiversified fund)

Putnam OTC & Emerging Growth Fund

MSIF Small Company Growth Portfolio

Putnam Capital Opportunities Fund

Putnam Vista Fund

INVESCO Energy Fund (sector fund)

Putnam International Capital Opportunities Fund

Putnam Mid Cap Value Fund

Putnam Research Fund

Janus Adviser Worldwide Fund

Putnam Investors Fund

MSIF Equity Growth Portfolio

American Century International Growth Fund

Tier 2 and Tier 3 fund lineupYour six sector funds typically concentrate their investments in one region or industry and involve more risk than funds that invest broadly

Higher risk/higher potential reward

(continued on following slide)

Putnam International Equity Fund

Putnam S&P 500 Index Fund

Putnam International Growth and Income Fund

Templeton Growth Fund, Inc.

Barclay’s Global Investors MSCI World Equity Index Fund ex-US

STI Classic Small Cap Value Equity Fund

The Putnam Fund for Growth and Income

Putnam Health Sciences Trust (sector fund)

Van Kampen Utility Fund (sector fund)

Oppenheimer Quest Global Value Fund, Inc.

MSIF U.S. Real Estate Portfolio (sector fund)

Putnam Asset Allocation: Balanced Portfolio

PIMCO High Yield Fund (sector fund)

Putnam Bond Index Fund

PRIMCO Stable Value Fund

Tier 2 and Tier 3 fund lineup

Lower risk/lower potential reward

(continued)

Questions