When used in this report, the terms "Company," "we," "us" or "our" mean The Coca-Cola Company and all entities included in our consolidated financial statements.

Recoverability of Noncurrent Assets

Our Company faces many uncertainties and risks related to various economic, political and regulatory environments in the countries in which we operate, particularly in developing and emerging markets. Refer to the heading "Item 1A. Risk Factors" in Part I and "Our Business - Challenges and Risks" in Part II of our Annual Report on Form 10-K for the year ended December 31, 2008. As a result, management must make numerous assumptions which involve a significant amount of judgment when completing recoverability and impairment tests of noncurrent assets in various regions around the world.

We perform recoverability and impairment tests of noncurrent assets in accordance with accounting principles generally accepted in the United States. For certain assets, recoverability and/or impairment tests are required only when conditions exist that indicate the carrying value may not be recoverable. For other assets, impairment tests are required at least annually, or more frequently, if events or circumstances indicate that an asset may be impaired.

Investments in Equity and Debt Securities

Investments classified as trading securities are not assessed for impairment, since they are carried at fair value with the change in fair value included in consolidated net income. We review our investments in equity and debt securities that are accounted for using the equity method or cost method or that are classified as available-for-sale or held-to-maturity each reporting period to determine whether a significant event or change in circumstances has occurred that may have an adverse effect on the fair value of each investment. When such events or changes occur, we evaluate the fair value compared to our cost basis in the investment. We also perform this evaluation every reporting period for each investment for which our cost basis has exceeded the fair value in the prior period. The fair values of most of our Company's investments in publicly traded companies are often readily available based on quoted market prices. For investments in nonpublicly traded companies, management's assessment of fair value is based on valuation methodologies including discounted cash flows, estimates of sales proceeds and appraisals, as appropriate. We consider the assumptions that we believe hypothetical marketplace participants would use in evaluating estimated future cash flows when employing the discounted cash flow or estimates of sales proceeds valuation methodologies. The ability to accurately predict future cash flows, especially in developing and emerging markets, may impact the determination of fair value.

In the event the fair value of an investment declines below our cost basis, management is required to determine if the decline in fair value is other than temporary. If management determines the decline is other than temporary, an impairment charge is recorded. Management's assessment as to the nature of a decline in fair value is based on, among other things, the length of time and the extent to which the market value has been less than our cost basis; the financial condition and near-term prospects of the issuer; and our intent and ability to retain the investment in the issuer for a period of time sufficient to allow for any anticipated recovery in market value.

                                                     Fair             Carrying
July 3, 2009                                        Value                Value             Difference

Coca-Cola Enterprises Inc.1                       $ 2,822               $    -                $ 2,822
Coca-Cola FEMSA, S.A.B. de C.V.                     2,480                  952                  1,528
Coca-Cola Hellenic Bottling                         1,749                1,491                    258
Company S.A.
Coca-Cola Amatil Limited                            1,567                  744                    823
Grupo Continental, S.A.B.                             283                  152                    131
Coca-Cola Icecek A.S.                                 297                  126                    171
Coca-Cola Embonor S.A.                                270                  193                     77
Coca-Cola Bottling Co. Consolidated                   136                   69                     67
Embotelladoras Coca-Cola Polar S.A.                    94                   72                     22

Total                                             $ 9,698              $ 3,799                $ 5,899

1 The carrying value of our investment in Coca-Cola Enterprises Inc. ("CCE") was reduced to zero as of December 31, 2008, primarily as a result of recording our proportionate share of impairment charges and items impacting accumulated other comprehensive income (loss) ("AOCI") recorded by CCE during 2008.

The carrying value of our investment in Coca-Cola Hellenic Bottling Company S.A. ("Coca-Cola Hellenic") exceeded its fair value in the last three months of 2008 and the first three months of 2009; however, the amount by which our cost basis exceeded its fair value decreased in each of those months. During the second quarter of 2009, Coca-Cola Hellenic's share price rose to a level where its fair value exceeded our cost basis. As of July 3, 2009, the fair value of our investment in Coca-Cola Hellenic exceeded our cost basis by approximately $258 million. We will continue to monitor our investment in future periods.

As of July 3, 2009, the Company had several investments classified as available-for-sale securities in which our cost basis has exceeded the fair value of the investment. As of July 3, 2009, unrealized gains and losses on available-for-sale securities were approximately $268 million and $10 million, respectively. Management assessed each individual investment with unrealized losses to determine if the decline in fair value was other than temporary. Based on these assessments, management determined that the decline in fair value of each of these investments was temporary in nature. We will continue to monitor these investments in future periods.

During the first quarter of 2009, the Company recorded a charge of approximately $27 million in other income (loss) - net as a result of an other-than-temporary decline in the fair value of a cost method investment. As of December 31, 2008, the estimated fair value of this investment approximated the Company's carrying value in the investment. However, during the first quarter of 2009, the Company was informed by the investee of its intent to reorganize its capital structure in 2009, which would result in the Company's shares in the investee being canceled. As a result, the Company determined that the decline in fair value of this cost method investment was other than temporary. This impairment charge impacted the Corporate operating segment. Refer to Note H and Note K of Notes to Condensed Consolidated Financial Statements.

Goodwill, Trademarks and Other Intangible Assets

SFAS No. 142, "Goodwill and Other Intangible Assets," classifies intangible assets into three categories: (1) intangible assets with definite lives subject to amortization; (2) intangible assets with indefinite lives not subject to amortization; and (3) goodwill. For intangible assets with definite lives, tests for impairment must be performed if conditions exist that indicate the carrying value may not be recoverable. For intangible assets with indefinite lives and goodwill, tests for impairment must be

performed at least annually or more frequently if events or circumstances indicate that assets might be impaired. Our equity method investees also perform such tests for impairment of intangible assets and/or goodwill. If an impairment charge was recorded by one of our equity method investees, the Company would record its proportionate share of such charge. However, the actual amount we record with respect to our proportionate share of such charges may be impacted by items such as basis differences, deferred taxes and deferred gains.

Intangible assets acquired in recent transactions are naturally more susceptible to impairment, primarily due to the fact that they are recorded at fair value based on recent operating plans and macroeconomic conditions present at the time of acquisition. Consequently, if operating results and/or macroeconomic conditions deteriorate shortly after an acquisition, it could result in the impairment of the acquired assets. A deterioration of macroeconomic conditions may not only negatively impact the estimated operating cash flows used in our cash flow models, but may also negatively impact other assumptions used in our analyses, including, but not limited to, the estimated cost of capital and/or discount rates. Additionally, in accordance with accounting principles generally accepted in the United States, we are required to ensure that assumptions used to determine fair value in our analyses are consistent with the assumptions a hypothetical marketplace participant would use. As a result, the cost of capital and/or discount rates used in our analyses may increase or decrease based on market conditions and trends, regardless of whether our Company's actual cost of capital has changed. Therefore, our Company may recognize an impairment of an intangible asset or assets in spite of realizing actual cash flows that are approximately equal to or greater than our previously forecasted amounts.

During the first quarter of 2009, the Company recorded an asset impairment charge of approximately $23 million. The impairment charge was the result of a change in the expected useful life of an intangible asset, which was previously determined to have an indefinite life. This charge was recorded in other operating charges and impacted the Bottling Investments operating segment. Refer to Note H and Note K of Notes to Condensed Consolidated Financial Statements.

Sales of our ready-to-drink nonalcoholic beverages are somewhat seasonal, with the second and third calendar quarters accounting for the highest sales volumes. The volume of sales in the beverage business may be affected by weather conditions.

Beverage Volume

We measure our sales volume in two ways: (1) unit cases of finished products and (2) concentrate sales. A "unit case" is a unit of measurement equal to 192 U.S. fluid ounces of finished beverage (24 eight-ounce servings). Unit case volume represents the number of unit cases of Company beverage products directly or indirectly sold by the Company and its bottling partners ("Coca-Cola system") to customers. Unit case volume primarily consists of beverage products bearing Company trademarks. Also included in unit case volume are certain products licensed to, or distributed by, our Company, and brands owned by Coca-Cola system bottlers for which our Company provides marketing support and from the sale of which we derive economic benefit. Such products licensed to, or distributed by, our Company or owned by Coca-Cola system bottlers account for a minimal portion of total unit case volume. In addition, unit case volume includes sales by joint ventures in which the Company has an equity interest. Unit case volume is derived based on estimates supplied by our bottling partners and distributors. Concentrate sales volume represents the amount of concentrates, syrups, beverage bases and powders (in all cases expressed in equivalent unit cases) sold by, or used in finished beverages sold by, the Company to its bottling partners or other customers. Most of our revenues are based on concentrate sales, a primarily wholesale activity. Unit case volume and concentrate sales growth rates are not necessarily equal during any given period. Factors such as seasonality, bottlers' inventory

practices, supply point changes, timing of price increases, new product introductions and changes in product mix can impact unit case volume and concentrate sales and can create differences between unit case volume and concentrate sales growth rates. In addition to the items mentioned above, the impact of unit case volume from certain joint ventures in which the Company has an equity interest, but to which the Company does not sell concentrates, syrups, beverage bases or powders, may give rise to differences between unit case volume and concentrate sales growth rates.

Information about our volume growth by operating segment for the three and six months ended July 3, 2009, is as follows:

                                                   Percentage Change
                                                  2009 versus 2008
                                    Second Quarter                  Year-to-Date
                                  Unit         Concentrate       Unit         Concentrate
                                 Cases 1,2,3         Sales 4    Cases 1,2,3         Sales 4

   Worldwide5                        4 %                 3 %        3 %                 5 %
      Eurasia & Africa               7                   2          5                   4
      Europe                         1                  (2 )       (1 )                (1 )
      Latin America                  6                   8          6                   9
      North America                 (1 )                (1 )       (2 )                 -
      Pacific                        6                   8          5                   9
   Bottling Investments             (3 )               N/A         (4 )               N/A

1 Bottling Investments operating segment data reflect unit case volume growth for consolidated bottlers only.
2 Geographic segment data reflect unit case volume growth for all bottlers in the applicable geographic areas, both consolidated and unconsolidated.
3 Unit case volume percentage change is based on average daily sales. Unit case volume growth based on average daily sales is computed by comparing the average daily sales in each of the corresponding periods. Average daily sales for each quarter and year-to-date period are the unit cases sold during the period divided by the number of days in the period.
4 Concentrate sales volume represents the actual amount of concentrates, syrups, beverage bases and powders sold by, or used in finished beverages sold by, the Company to its bottling partners or other customers and is not based on average daily sales. Each of our interim reporting periods, other than the fourth interim reporting period, ends on the Friday closest to the last day of the corresponding quarterly calendar period. The first quarter of 2009 had five additional days compared to the first quarter of 2008. However, the reporting period for the three months ended July 3, 2009, had the same number of days compared to the three months ended June 27, 2008. Consequently, the reporting period for the six months ended July 3, 2009, had five additional days compared to the six months ended June 27, 2008. Our fourth interim reporting period and our fiscal year end on December 31 regardless of the day of the week on which December 31 falls. The fourth quarter of 2009 will have six fewer days compared to the fourth quarter of 2008.
5 Acquisitions contributed 1 percentage point of worldwide unit case volume growth in the three and six months ended July 3, 2009, respectively, versus the comparable periods of the prior year.

Unit Case Volume

Although most of our Company's revenues are not based directly on unit case volume, we believe unit case volume is one of the measures of the underlying strength of the Coca-Cola system because it measures trends at the consumer level.

Unit case volume in Europe increased 1 percent in the second quarter of 2009 and decreased 1 percent in the six months ended July 3, 2009, versus the comparable periods of the prior year. The unit case volume growth in the second quarter consisted of growth in sparkling and still beverages of 1 percent and 4 percent, respectively. The group's second quarter growth was primarily attributable to 9 percent growth in France and 6 percent growth in Great Britain during the quarter. The volume growth in these markets was partially offset by the impact of difficult macroeconomic conditions throughout most of Europe, which impacted a number of key markets and contributed to low single-digit volume declines in Germany and Iberia in the second quarter and mid single-digit declines for the six months ended July 3, 2009.

In Latin America, unit case volume increased 6 percent in the second quarter of 2009 and six months ended July 3, 2009, versus the comparable periods of the prior year. The group's unit case volume growth in the second quarter consisted of 3 percent growth in sparkling beverages and 24 percent growth in still beverages. Latin America benefited from strong volume growth in key markets during the second quarter, including 6 percent in Mexico, 5 percent in Brazil and 6 percent in Argentina. Acquisitions contributed 1 percentage point of the group's total unit case volume growth in the quarter and six months ended July 3, 2009. Sparkling beverage unit case volume growth in the second quarter was primarily attributable to 4 percent volume growth in Coca-Cola. The successful integration of Jugos del Valle, S.A.B. de C.V. ("Jugos del Valle"), which we acquired jointly with Coca-Cola FEMSA, S.A.B. de C.V. ("Coca-Cola FEMSA") in 2007, drove still beverage volume growth. Excluding the impact of acquisitions, still beverage unit case volume grew 19 percent in the second quarter of 2009 and 21 percent for the six months ended July 3, 2009.

Unit case volume in North America decreased 1 percent in the second quarter of 2009 and 2 percent in the six months ended July 3, 2009, versus the comparable periods of the prior year. The group's unit case volume for the second quarter and for the six months ended July 3, 2009, reflected the impact of a continuing difficult U.S. economic environment. The effect of the economic environment on the second quarter was partially offset by the impact of holiday shifts into the second quarter of 2009 versus the second quarter of 2008 and strong customer and consumer programs. North America's unit case volume decline in the second quarter consisted of a 2 percent decline in sparkling beverages, partially offset by 1 percent growth in still beverages. The decline in sparkling beverages in the current quarter and the six months ended July 3, 2009, was partly attributable to the significant bottler price increase taken in the fourth quarter of 2008. The negative impact of current macroeconomic conditions and bottler price increases was partially offset by the continued strong performance of Coca-Cola Zero, which had a 24 percent unit case volume increase in the second quarter. Still beverage unit case volume growth in the quarter was primarily due to the strong performance of Fuze, Trademark Simply and tea. The unit case volume growth in still beverages also

included a double-digit volume decline in Trademark Dasani in the second quarter, primarily due to the slowing water category.

In Pacific, unit case volume increased 6 percent in the second quarter of 2009 and 5 percent in the six months ended July 3, 2009, versus the comparable periods of the prior year. Pacific's unit case volume growth in the second quarter of 2009 consisted of growth in sparkling and still beverages of 7 percent and 5 percent, respectively. Sparkling beverage growth in Pacific for the second quarter included 6 percent growth in Trademark Coca-Cola. The group's second quarter volume growth was led by 14 percent growth in China and 2 percent growth in Japan. China's second quarter volume growth reflected 14 percent growth in sparkling beverages and 15 percent growth in still beverages. China's sparkling beverage volume growth was led by double-digit growth in Trademark Sprite and high single-digit growth in Trademark Coca-Cola and Trademark Fanta. China's still beverage volume growth was led by double-digit growth in Minute Maid. Japan's 2 percent unit case volume growth in the second quarter of 2009 consisted of 6 percent growth in sparkling beverages and 1 percent growth in still beverages. Japan's growth in sparkling beverages in the quarter was led by 10 percent growth in Trademark Coca-Cola, primarily attributable to the continued success of Coca-Cola Zero. Still beverage growth in Japan during the quarter was primarily attributable to 9 percent growth in Sokenbicha, partially offset by a volume decline in Georgia Coffee. Due to the weak economy, Georgia Coffee was negatively impacted by shifts away from the at-work vending channel. The unit case volume growth in the aforementioned markets was partially offset by a 6 percent decline in the Philippines during the second quarter.

Unit case volume for Bottling Investments decreased 3 percent in the second quarter of 2009 and 4 percent in the six months ended July 3, 2009, versus the comparable periods of the prior year. The group's unit case volume decline in the quarter and in the six months ended July 3, 2009, was primarily due to the sale of certain bottling operations during 2008, including Refrigerantes Minas Gerais Ltda. ("Remil"), a bottler in Brazil, and the sale of a portion of our ownership interest in Coca-Cola Beverages Pakistan Ltd. ("Coca-Cola Pakistan"), which resulted in its deconsolidation. Unit case volume declines in Germany and the Philippines also contributed to the group's unit case volume decline in the second quarter of 2009 and the six months ended July 3, 2009. The Company's consolidated bottling operations account for 100 percent of the unit case volume in those countries.

Concentrate Sales Volume

For the second quarter of 2009, differences between unit case volume and concentrate sales volume growth rates for all operating segments were primarily due to timing of concentrate shipments and the impact of unit case volume from certain joint ventures in which the Company has an equity interest, but to which the Company does not sell concentrates, syrups, beverage bases or powders. As discussed above, unit case volume growth rates are based on average daily sales. Conversely, concentrate sales volume growth rates are based on the actual amount of concentrates, syrups, beverage bases and powders sold by, or used in finished beverages sold by, the Company to its bottling partners or other customers and are not calculated based on average daily sales.

For the six months ended July 3, 2009, differences between unit case volume and concentrate sales volume growth rates for all operating segments were primarily due to five additional selling days in the first quarter of 2009 versus the first quarter of 2008. In addition to the five extra selling days in the first quarter of 2009, the timing of concentrate shipments and the impact of unit case volume from certain joint ventures in which the Company has an equity interest, but to which the Company does not sell concentrates, syrups, beverage bases or powders, also contributed to the differences between unit case volume and concentrate sales volume growth rates.

Net Operating Revenues

    Net operating revenues decreased by $779 million, or 9 percent, for the
three months ended July 3, 2009, compared to the three months ended June 27,
2008. The following table illustrates, on a percentage basis, the estimated
impact of key factors which resulted in the decrease in net operating revenues:

                                                             Percentage Change
                                                              2009 versus 2008

  Increase in concentrate sales volume                                       3 %
  Structural changes                                                        (2 )
  Price and product/geographic mix                                          (1 )
  Impact of currency fluctuations versus the U.S. dollar                    (9 )

  Total percentage decrease                                                 (9 )%

Refer to the heading "Beverage Volume," above, for a discussion of concentrate sales volume. Also included in concentrate sales volume is the impact of acquired beverage companies and the acquisition of trademarks.

"Structural changes" refers to acquisitions or dispositions of bottling, distribution or canning operations and consolidation or deconsolidation of bottling or distribution entities for accounting purposes. Structural changes accounted for approximately 2 percent of the decrease in net operating revenues in the second quarter of 2009 versus the comparable period in the prior year. This decrease was primarily attributable to the sale of certain bottling operations during 2008, including Remil and a portion of our ownership interest in Coca-Cola Pakistan, which resulted in its deconsolidation.

Price and product/geographic mix decreased net operating revenues by approximately 1 percent in the second quarter of 2009 versus the comparable period in the prior year. This decrease reflected our current focus to drive greater affordability initiatives across many key markets to ensure we continue building brand relevance and equity with consumers. Additionally, our Japanese business was impacted by shifts away from the at-work vending channel.

The unfavorable impact of currency fluctuations decreased net operating revenues by approximately 9 percent in the second quarter of 2009 versus the comparable period in the prior year. The unfavorable impact of changes in foreign currency exchange rates was primarily due to a stronger U.S. dollar compared to most foreign currencies, including the euro, Brazilian real, Mexican peso, British pound, Australian dollar and South African rand, which had an unfavorable impact on the Eurasia and Africa, Europe, Latin America, Pacific and Bottling Investments operating segments. The unfavorable impact of a stronger . . .