Revision of Prior Period Financial Statements

During the second quarter of 2011, Coca-Cola Bottling Co. Consolidated ("the Company") identified an error in the treatment of accrued additions for property, plant and equipment in the Consolidated Statements of Cash Flows. The Company has revised prior period financial statements to correct this immaterial error. Refer to Note 1 Significant Accounting Policies - Revision of Prior Period Financial Statements for further details. This error affected the Consolidated Statements of Cash Flows and Supplemental Disclosures of Cash Flow Information presented for the first quarter of 2011 and resulted in an understatement of net cash provided by operating activities and net cash used in investing activities for this period. This revision did not affect the Company's Consolidated Statements of Operations or Consolidated Balance Sheets for any of these periods. The discussion and analysis included herein is based on the financial results (and revised Consolidated Statements of Cash Flows) for the first quarter ended April 3, 2011.

The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("M,D&A") of Coca-Cola Bottling Co. Consolidated (the "Company") should be read in conjunction with the Company's consolidated financial statements and the accompanying notes to the consolidated financial statements. M,D&A includes the following sections:

• Our Business and the Nonalcoholic Beverage Industry - a general description of the Company's business and the nonalcoholic beverage industry.

• Areas of Emphasis - a summary of the Company's key priorities.

• Overview of Operations and Financial Condition - a summary of key information and trends concerning the financial results for the first quarter of 2012 ("Q1 2012") and changes from the first quarter of 2011 ("Q1 2011").

• Discussion of Critical Accounting Policies, Estimates and New Accounting Pronouncements - a discussion of accounting policies that are most important to the portrayal of the Company's financial condition and results of operations and that require critical judgments and estimates and the expected impact of new accounting pronouncements.

• Results of Operations - an analysis of the Company's results of operations for Q1 2012 compared to Q1 2011.

• Financial Condition - an analysis of the Company's financial condition as of the end of Q1 2012 compared to year-end 2011 and the end of Q1 2011 as presented in the consolidated financial statements.

• Liquidity and Capital Resources - an analysis of capital resources, cash sources and uses, investing activities, financing activities, off-balance sheet arrangements, aggregate contractual obligations and hedging activities.

• Cautionary Information Regarding Forward-Looking Statements.

The consolidated financial statements include the consolidated operations of the Company and its majority-owned subsidiaries including Piedmont Coca-Cola Bottling Partnership ("Piedmont"). Noncontrolling interest primarily consists of The Coca-Cola Company's interest in Piedmont, which was 22.7% for all periods presented.

Our Business and the Nonalcoholic Beverage Industry

The Company produces, markets and distributes nonalcoholic beverages, primarily products of The Coca-Cola Company, which include some of the most recognized and popular beverage brands in the world. The Company is the largest independent bottler of products of The Coca-Cola Company in the United States, distributing these products in eleven states primarily in the Southeast. The Company also distributes several other beverage brands. These product offerings include both sparkling and still beverages. Sparkling beverages are carbonated beverages including energy products. Still beverages are noncarbonated beverages such as bottled water, tea, ready to drink coffee, enhanced water, juices and sports drinks. The Company had full year net sales of $1.6 billion in 2011.

The nonalcoholic beverage market is highly competitive. The Company's competitors include bottlers and distributors of nationally and regionally advertised and marketed products and private label products. In each region in which the Company operates, between 85% and 95% of sparkling beverage sales in bottles, cans and other containers are accounted for by the Company and its principal competitors, which in each region includes the local bottler of Pepsi-Cola and, in some regions, the local bottler of Dr Pepper, Royal Crown and/or 7-Up products. The sparkling beverage category (including energy products) represents 83% of the Company's Q1 2012 bottle/can net sales.

The principal methods of competition in the nonalcoholic beverage industry are point-of-sale merchandising, new product introductions, new vending and dispensing equipment, packaging changes, pricing, price promotions, product quality, retail space management, customer service, frequency of distribution and advertising. The Company believes it is competitive in its territories with respect to each of these methods.

Historically, operating results for the first quarter of the fiscal year have not been representative of results for the entire fiscal year. Business seasonality results primarily from higher unit sales of the Company's products in the second and third quarters versus the first and fourth quarters of the fiscal year. Fixed costs, such as depreciation expense, are not significantly impacted by business seasonality.

The Company performs its annual impairment test of franchise rights and goodwill as of the first day of the fourth quarter. During Q1 2012, the Company did not experience any triggering events or changes in circumstances that indicated the carrying amounts of the Company's franchise rights or goodwill exceeded fair values. As such, the Company has not recognized any impairments of franchise rights or goodwill.

Net sales by product category were as follows:

                                                             First Quarter
      In Thousands                                        2012          2011

      Bottle/can sales:
      Sparkling beverages (including energy products)   $ 256,717     $ 243,028
      Still beverages                                      50,904        48,273

      Total bottle/can sales                              307,621       291,301

      Other sales:
      Sales to other Coca-Cola bottlers                    33,465        36,100
      Post-mix and other                                   36,099        32,228

      Total other sales                                    69,564        68,328

Total net sales $ 377,185 $ 359,629

Areas of Emphasis

Key priorities for the Company include revenue management, product innovation and beverage portfolio expansion, distribution cost management and productivity.

Revenue Management

Revenue management requires a strategy which reflects consideration for pricing of brands and packages within product categories and channels, highly effective working relationships with customers and disciplined fact-based decision-making. Revenue management has been and continues to be a key performance driver which has significant impact on the Company's results of operations.

Product Innovation and Beverage Portfolio Expansion

Innovation of both new brands and packages has been and will continue to be critical to the Company's overall revenue. During 2008, the Company tested the 16-ounce bottle/24-ounce bottle package for many of the Company's sparkling beverages in select convenience stores and introduced it company wide in 2009. New packaging introductions included the 1.25-liter bottle in 2011, the 7.5-ounce sleek can in 2010 and the 2-liter contour bottle for Coca-Cola products during 2009.

The Company has invested in its own brand portfolio with products such as Tum-E Yummies, a vitamin C enhanced flavored drink, Country Breeze tea, Bean & Body coffee beverages and Fuel in a Bottle power shots. These brands enable the Company to participate in strong growth categories and capitalize on distribution channels that may include the Company's traditional Coca-Cola franchise territory as well as third party distributors outside the Company's traditional Coca-Cola franchise territory. While the growth prospects of Company-owned or exclusively licensed brands appear promising, the cost of developing, marketing and distributing these brands is anticipated to be significant as well.

Distribution Cost Management

Distribution costs represent the costs of transporting finished goods from Company locations to customer outlets. Total distribution costs amounted to $48.6 million and $45.9 million in Q1 2012 and Q1 2011, respectively. Over the past several years, the Company has focused on converting its distribution system from a conventional routing system to a predictive system. This conversion to a predictive system has allowed the Company to more efficiently handle increasing numbers of products. In addition, the Company has closed a number of smaller sales distribution centers over the past several years reducing its fixed warehouse-related costs.

The Company has three primary delivery systems for its current business:

• bulk delivery for large supermarkets, mass merchandisers and club stores;

• advanced sales delivery for convenience stores, drug stores, small supermarkets and certain on-premise accounts; and

• full service delivery for its full service vending customers.

Distribution cost management will continue to be a key area of emphasis for the Company.

Productivity

A key driver in the Company's selling, delivery and administrative ("S,D&A") expense management relates to ongoing improvements in labor productivity and asset productivity.

Overview of Operations and Financial Condition

The following items affect the comparability of the financial results presented below:

Q1 2012

• a $.7 million additional income tax expense to increase the valuation allowance for certain deferred tax assets of the Company.

Q1 2011

• a $.1 million pre-tax unfavorable mark-to-market adjustment to S,D&A expenses related to the Company's 2011 fuel hedging program; and

• a $.5 million pre-tax unfavorable mark-to-market adjustment to cost of sales related to the Company's 2011 aluminum hedging program.

The following overview provides a summary of key information concerning the Company's financial results for Q1 2012 compared to Q1 2011.

                                               First Quarter                            %
In Thousands (Except Per Share Data)       2012          2011           Change       Change
Net sales                                $ 377,185     $ 359,629       $ 17,556          4.9
Cost of sales                              221,591       210,468         11,123          5.3
Gross margin                               155,594       149,161          6,433          4.3
S,D&A expenses                             136,961       129,982          6,979          5.4
Income from operations                      18,633        19,179           (546 )       (2.8 )
Interest expense, net                        9,071         8,769            302          3.4
Income before taxes                          9,562        10,410           (848 )       (8.1 )
Income tax expense                           4,467         3,941            526         13.3
Net income                                   5,095         6,469         (1,374 )      (21.2 )
Net income attributable to the Company       4,565         5,913         (1,348 )      (22.8 )
Basic net income per share:
Common Stock                             $     .50     $     .64       $   (.14 )      (21.9 )
Class B Common Stock                     $     .50     $     .64       $   (.14 )      (21.9 )
Diluted net income per share:
Common Stock                             $     .49     $     .64       $   (.15 )      (23.4 )
Class B Common Stock                     $     .49     $     .64       $   (.15 )      (23.4 )

The Company's net sales increased 4.9% in Q1 2012 compared to Q1 2011. The increase in net sales was primarily due to a 4.8% increase in bottle/can sales volume in Q1 2012 compared to Q1 2011. The increase in bottle/can sales volume was primarily due to a volume increase in all beverage categories. Bottle/can sales price per unit increased .8% in Q1 2012 compared to Q1 2011.

Gross margin dollars increased 4.3% in Q1 2012 compared to Q1 2011. The Company's gross margin percentage decreased to 41.3% in Q1 2012 from 41.5% in Q1 2011. The decrease in gross margin percentage was primarily due to higher costs of raw materials partially offset by higher sales price per unit for bottle/can volume.

The following inputs represent a substantial portion of the Company's total cost of goods sold: (1) sweeteners, (2) packaging materials, including plastic bottles and aluminum cans, and (3) full goods purchased from other vendors. The Company anticipates that the costs of the underlying commodities related to these inputs will continue to face upward pressure and gross margins on all categories of products will be lower throughout the remainder of 2012 compared to 2011 unless rising commodity costs can be offset with price increases.

S,D&A expenses increased 5.4% in Q1 2012 from Q1 2011. The increase in S,D&A expenses in Q1 2012 from Q1 2011 was attributable to increased employee payroll costs including benefit costs, increased marketing expense, fuel costs and increased depreciation expense.

Net interest expense increased 3.4% in Q1 2012 compared to Q1 2011. The increase was primarily due to the Company entering into two new capital leases in Q1 2011. The Company's overall weighted average interest rate on its debt and capital lease obligations increased to 6.1% during Q1 2012 from 6.0% during Q1 2011.

Net debt and capital lease obligations were summarized as follows:

                                                    April 1,          Jan. 1,         April 3,
In Thousands                                          2012             2012             2011
Debt                                                $ 523,260        $ 523,219        $ 523,101
Capital lease obligations                              73,012           74,054           76,871
Total debt and capital lease obligations              596,272          597,273          599,972
Less: Cash and cash equivalents                        57,649           93,758           33,882
Total net debt and capital lease obligations (1)    $ 538,623        $ 503,515        $ 566,090

(1) The non-GAAP measure "Total net debt and capital lease obligations" is used to provide investors with additional information which management believes is helpful in the evaluation of the Company's capital structure and financial leverage. This non-GAAP financial information is not presented elsewhere in this report and may not be comparable to the similarly titled measures used by other companies. Additionally, this information should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.

Discussion of Critical Accounting Policies, Estimates and New Accounting Pronouncements

Critical Accounting Policies and Estimates

In the ordinary course of business, the Company has made a number of estimates and assumptions relating to the reporting of results of operations and financial position in the preparation of its consolidated financial statements in conformity with accounting principles generally accepted in the United States of America. Actual results could differ significantly from those estimates under different assumptions and conditions. The Company included in its Annual Report on Form 10-K for the year ended January 1, 2012 a discussion of the Company's most critical accounting policies, which are those most important to the portrayal of the Company's financial condition and results of operations and require management's most difficult, subjective and complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.

The Company did not make changes in any critical accounting policies during Q1 2012. Any changes in critical accounting policies and estimates are discussed with the Audit Committee of the Board of Directors of the Company during the quarter in which a change is made.

New Accounting Pronouncements

Recently Adopted Pronouncements

In June 2011, the Financial Accounting Standards Board ("FASB") amended its guidance on the presentation of comprehensive income in financial statements to improve the comparability, consistency and transparency of financial reporting and to increase the prominence of items that are recorded in other comprehensive income. The new guidance requires entities to report components of comprehensive income in either (1) a continuous statement of comprehensive income or (2) two separate but consecutive statements. The Company elected to report components of comprehensive income in two separate but consecutive statements. The new guidance was effective for the quarter ended April 1, 2012 and was applied retrospectively. The Company's adoption of the new guidance resulted in a change in the presentation of the Company's consolidated financial statements but did not have any impact on the Company's results of operations, financial position or liquidity.

In September 2011, the FASB issued new guidance relative to the test for goodwill impairment. The new guidance permits an entity to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. The new guidance is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. The Company does not expect the requirements of this new guidance to have a material impact on the Company's consolidated financial statements.

In December 2011, the FASB issued new guidance that is intended to enhance current disclosures on offsetting financial assets and liabilities. The new guidance requires an entity to disclose both gross and net information about financial instruments eligible for offset on the balance sheet and instruments and transactions subject to an agreement similar to a master netting arrangement. The provisions of the new guidance are effective for fiscal years, and interim periods within those years, beginning on or after January 1, 2013. The Company does not expect the requirements of this new guidance to have a material impact on the Company's consolidated financial statements.

Results of Operations

Q1 2012 Compared to Q1 2011

Net Sales

Net sales increased $17.5 million, or 4.9%, to $377.1 million in Q1 2012
compared to $359.6 million in Q1 2011.

The increase was principally attributable to the following:



     Q1 2012             Attributable to:
  (In Millions)
$            13.9        4.8% increase in bottle/can volume to retail customers
                         primarily due to volume increase in all beverage categories
             (4.0 )      11.0% decrease in sales volume to other Coca-Cola bottlers
                         primarily due to volume decreases in sparkling beverages
              2.4        .8% increase in bottle/can sales price per unit primarily due
                         to an increase in sales price per unit in sparkling beverages
                         except energy products
              1.3        4.1% increase in sale price per unit of sales to other
                         Coca-Cola bottlers primarily due to an increase in sales
                         price per unit in sparkling beverages
              0.9        Increase in sales of the Company's own brand portfolio
                         (primarily Tum-E Yummies)
              0.8        3.8% increase in post-mix sales price per unit
              0.7        Increase in freight revenue
              1.5        Other

$            17.5        Total increase in net sales

In Q1 2012, the Company's bottle/can sales to retail customers accounted for 81.6% of the Company's total net sales. Bottle/can net pricing is based on the invoice price charged to customers reduced by promotional allowances. Bottle/can net pricing per unit is impacted by the price charged per package, the volume generated in each package and the channels in which those packages are sold.

The increase in the Company's bottle/can net price per unit in Q1 2012 compared to Q1 2011 was primarily due to increases in sales price per unit in sparkling beverages except energy products.

Product category sales volume in Q1 2012 and Q1 2011 as a percentage of total bottle/can sales volume and the percentage change by product category was as follows:

                                              Bottle/Can Sales Volume           Bottle/Can Sales Volume
Product Category                             Q1 2012            Q1 2011               % Increase
Sparkling beverages (including energy
products)                                         84.7 %            85.0 %                4.4
Still beverages                                   15.3 %            15.0 %                7.0

Total bottle/can sales volume                    100.0 %           100.0 %                4.8

The Company's products are sold and distributed through various channels. They include selling directly to retail stores and other outlets such as food markets, institutional accounts and vending machine outlets. During both Q1 2012 and Q1 2011, approximately 68% of the Company's bottle/can volume was sold for future consumption, while the remaining bottle/can volume of approximately 32% was sold for immediate consumption. The Company's largest customer, Wal-Mart Stores, Inc., accounted for approximately 22% of

the Company's total bottle/can volume during Q1 2012. Wal-Mart Stores, Inc. accounted for approximately 20% of the Company's total bottle/can volume during Q1 2011. The Company's second largest customer, Food Lion, LLC, accounted for approximately 9% of the Company's total bottle/can volume during Q1 2012. Food Lion, LLC accounted for approximately 10% of the Company's total bottle/can volume during Q1 2011. All of the Company's beverage sales are to customers in the United States.

The Company recorded delivery fees in net sales of $1.7 million and $1.8 million in Q1 2012 and Q1 2011, respectively. These fees are used to offset a portion of the Company's delivery and handling costs.

Cost of Sales

Cost of sales includes the following: raw material costs, manufacturing labor, manufacturing overhead including depreciation expense, manufacturing warehousing costs and shipping and handling costs related to the movement of finished goods from manufacturing locations to sales distribution centers.

Cost of sales increased 5.3%, or $11.1 million, to $221.6 million in Q1 2012 compared to $210.5 million in Q1 2011.

The increase in cost of sales was principally attributable to the following:

     Q1 2012             Attributable to:
  (In Millions)
$             8.0        4.8% increase in bottle/can volume to retail customers
                         primarily due to a volume increase in all beverage categories
              5.7        Increase in raw material costs such as plastic bottles
             (3.9 )      11.0% decrease in sales volume to other Coca-Cola bottlers
                         primarily due to volume decreases in sparkling beverages
              0.6        Increase in freight cost of goods sold
              0.6        Increase in the sales of the Company's own brand portfolio
                         (primarily Tum-E Yummies)
              0.1        Other

$            11.1        Total increase in cost of sales

The following inputs represent a substantial portion of the Company's total cost of goods sold: (1) sweeteners, (2) packaging materials, including plastic bottles and aluminum cans, and (3) full goods purchased from other vendors. The Company anticipates that the costs of the underlying commodities related to these inputs will continue to face upward pressure and gross margins on all categories of products will be lower throughout the remainder of 2012 compared to 2011 unless rising commodity costs can be offset with price increases.

The Company entered into an agreement (the "Incidence Pricing Agreement") in 2008 with The Coca-Cola Company to test an incidence-based concentrate pricing model for 2008 for all Coca-Cola Trademark Beverages and Allied Beverages for which the Company purchases concentrate from The Coca-Cola Company. During the term of the Incidence Pricing Agreement, the pricing of the concentrates for the Coca-Cola Trademark Beverages and Allied Beverages is governed by the Incidence Pricing Agreement rather than the Cola and Allied Beverage Agreements. The concentrate price The Coca-Cola Company charges under the Incidence Pricing Agreement is impacted by a number of factors including the Company's pricing of finished products, the channels in which the finished products are sold and package mix. The Coca-Cola Company must give the Company at least 90 days written notice before changing the price the Company pays for the concentrate. The Incidence Pricing Agreement has been extended twice and will remain in effect for the purchase of concentrate through December 31, 2013.

The Company relies extensively on advertising and sales promotion in the marketing of its products. The Coca-Cola Company and other beverage companies that supply concentrates, syrups and finished products to the Company make substantial marketing and advertising expenditures to promote sales in the local territories served by the Company. The Company also benefits from national advertising programs conducted by The Coca-Cola Company and other beverage companies. Certain of the marketing expenditures by The Coca-Cola Company and other beverage companies are made pursuant to annual arrangements.

Total marketing funding support from The Coca-Cola Company and other beverage companies, which includes direct payments to the Company and payments to customers for marketing programs, was $12.4 million for Q1 2012 compared to $12.6 million for Q1 2011.

Gross Margin . . .