COCA COLA FEMSA SAB DE CV | CIK:0000910631 | 3

  • Filed: 4/18/2018
  • Entity registrant name: COCA COLA FEMSA SAB DE CV (CIK: 0000910631)
  • Generator: Donnelley Financial Solutions
  • SEC filing page: http://www.sec.gov/Archives/edgar/data/910631/000119312518121141/0001193125-18-121141-index.htm
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  • ifrs-full:DisclosureOfEntitysReportableSegmentsExplanatory

    Note 25. Information by segment

    The Company’s chief operating decision maker (“CODM”) is the Chief Executive Officer, who periodically reviews financial information at the country level. Thus, each of the seperate countries in wich the Company operates is considered and operating segments, with the exception of the countries in Central America which represent a single operating segment.

    The Company has aggregated operating segments into the following reporting segments for the purposes of its consolidated financial statements: (i) Mexico and Central America division (comprising the following countries: Mexico (including corporate operations), Guatemala, Nicaragua, Costa Rica and Panama), (ii) the South America division (comprising the following countries: Brazil, Argentina, Colombia and Venezuela); Venezuela operates in an economy with exchange control and hyper-inflation; and as a result, IAS 29, “Financial Reporting in Hyperinflationary Economies” does not allow its aggregation into the South America segment and (iii) the Asian division comprised of Philippines commencing on February 1, 2017, started to be consolidated in the Company’s financial statements. The Company’s results for 2017 reflect a reduction in the share of the profit of associates and joint ventures accounted for using the equity method, net of taxes, as a result of this consolidation (see note 4.1.2). As disclosed in Note 3.3 the Company deconsolidated their operations in Venezuela, consequently there will not be financial information for this segment in future financial statements.

    The Company is of the view that the quantitative and qualitative aspects of the aggregated operating segments are similar in nature for all periods presented. In evaluating the appropriateness of aggregating operating segments, the key indicators considered included but were not limited to:(i) similarities of customer base, products, production processes and distribution processes, (ii) similarities of governments, (iii) inflation trends, since hyper-inflationary economy has different characteristics that carry out to making decision on how to deal with the cost of the production and distribution, Venezuela has been separated as a separate segment, (iv) currency trends and (v) historical and projected financial and operating statistics, historically and according to our estimates the financial trends of the countries aggregated into an operating segment have behaved in similar ways and are expected to continue to do so.

    Segment disclosure for the Company’s consolidated operations is as follows:

     

    2017    Mexico and
    Central
    America(1)
        South
    America(2)
         Venezuela     Asia      Consolidated  

    Total revenues

       Ps. 92,643     Ps. 86,608      Ps. 4,005     Ps. 20,524      Ps. 203,780  

    Intercompany revenue

         4,661       18        —         —          4,679  

    Gross profit

         45,106       37,756        646       8,178        91,686  

    Income before income taxes and share of the profit or loss of associates and joint ventures accounted for using the equity method

         (15,431     8,792        (1,786     1,265        (7,160

    Depreciation and amortization

         4,801       3,442        807       1,814        10,864  

    Non cash items other than depreciation and amortization (3)

         1,011       213        1,021       262        2,507  

    Equity in earnings (loss) of associated companies and joint ventures

         (63     123        —         —          60  

    Total assets

         135,363       122,042        —         28,272        285,677  

    Investments in associate companies and joint ventures

         7,046       4,455        —         —          11,501  

    Total liabilities

         91,385       43,637        —         9,945        144,967  

    Capital expenditures, net (4)

         8,231       4,686        —         1,695        14,612  

     

    2016    Mexico and
    Central
    America(1)
         South
    America(2)
        Venezuela      Consolidated  

    Total revenues

       Ps. 87,557      Ps. 71,293     Ps. 18,868      Ps. 177,718  

    Intercompany revenue

         4,266        3       —          4,269  

    Gross profit

         43,569        29,263       6,830        79,662  

    Income before income taxes and share of the profit or loss of associates and joint ventures accounted for using the equity method

         8,642        4,784       882        14,308  

    Depreciation and amortization

         4,750        3,078       838        8,666  

    Non cash items other than depreciation and amortization (3)

         424        61       2,423        2,908  

    Equity in earnings (loss) of associated companies and joint ventures

         149        (2     —          147  

    Total assets

         136,252        130,019       12,985        279,256  

    Investments in associate companies and joint ventures

         18,088        4,269       —          22,357  

    Total liabilities

         95,342        48,391       6,290        150,023  

    Capital expenditures, net (4)

         6,597        4,240       1,554        12,391  
    2015    Mexico and
    Central
    America(1)
         South
    America(2)
        Venezuela      Consolidated  

    Total revenues

       Ps. 78,709      Ps. 64,752     Ps.  8,899      Ps.  152,360  

    Intercompany revenue

         3,791        3       —          3,794  

    Gross profit

         40,130        27,532       4,368        72,030  

    Income before income taxes and share of the profit or loss of associates and joint ventures accounted for using the equity method

         10,614        3,220       891        14,725  

    Depreciation and amortization

         4,404        2,489       251        7,144  

    Non-cash items other than depreciation and amortization (3)

         685        130       1,352        2,167  

    Equity in earnings of associated companies and joint ventures

         97        58       —          155  

    Total assets

         133,941        69,281       7,027        210,249  

    Investments in associate companies and joint ventures

         15,779        2,094       —          17,873  

    Total liabilities

         80,963        17,528       3,023        101,514  

    Capital expenditures, net (4)

         4,672        5,686       1,126        11,484  

     

    (1) Central America includes Guatemala, Nicaragua, Costa Rica and Panama. Domestic (Mexico only) revenues were Ps. 79,836, Ps. 74,413 and Ps. 67,772 during the years ended December 31, 2017, 2016 and 2015, respectively. Domestic (Mexico only) total assets were Ps. 133,315, Ps. 122,552 and Ps. 123,585 as of December 31, 2017, 2016 and 2015, respectively. Domestic (Mexico only) total liabilities were Ps. 88,283 Ps. 92,303 and Ps. 78,834 as of December 31, 2017, 2016 and 2015, respectively.
    (2)  South America includes Brazil, Argentina, Colombia and Venezuela, although Venezuela is shown separately above. South America revenues include Brazilian revenues of Ps. 58,518, Ps. 43,900 and Ps. 37,825 during the years ended December 31, 2017, 2016 and 2015, respectively. Brazilian total assets were Ps. 95,713, Ps. 104,092 and Ps. 49,448 as of December 31, 2017, 2016 and 2015, respectively. Brazilian total liabilities Ps. 31,580, Ps. 39,600 and Ps. 10,753 as of December 31, 2017, 2016 and 2015, respectively. South America revenues also include Colombian revenues of Ps. 14,222, Ps. 15,120 and Ps. 12,984 during the years ended December 31, 2017, 2016 and 2015, respectively. Colombian total assets were Ps. 14,180, Ps. 20,581 and Ps. 15,182 as of December 31, 2017, 2016 and 2015, respectively. Colombian total liabilities were Ps.7,993, Ps. 5,547 and Ps. 3,977 as of December 31, 2017, 2016 and 2015, respectively. South America revenues also include Argentine revenues of Ps. 13,869, Ps. 12,273 and Ps. 13,943 during the years ended December 31, 2017, 2016 and 2015, respectively. Argentine total assets were Ps. 5,301, Ps. 5,346 and Ps. 4,651 as of December 31, 2017, 2016 and 2015, respectively. Argentine total liabilities were Ps.3,660, Ps. 3,244 and Ps. 2,798 as of December 31, 2017, 2016 and 2015, respectively.
    (3)  Includes foreign exchange loss, net; gain on monetary position, net; and market value (gain) loss on financial instruments.
    (4)  Includes acquisitions and disposals of property, plant and equipment, intangible assets and other long-lived assets.
    (5)  The Asian division includes CCFPI (Philippines) which investment was acquired in 2013, and the Company started consolidating in February 1, 2017, see Note 9. The equity in earnings of the Asian division were , Ps. 93 and Ps. 86 in 2016 and 2015, repectively and are presented as part of the Company’s corporate operations in 2016 and 2015 and thus disclosed net in the table above as part of the “equity in earnings of associated companies” in the Mexico & Central America division, as is the equity method investment in CCFPI of Ps. 11,460 and 9,996, respectively. However, the Asian division represents a separate reporting segment under IFRS 8 and is represented by the following investee level amounts, prior to consolidation as of and for the years ended December 2016 and 2015, respectively: revenues Ps. 22,768 and Ps. 19,576, gross profit Ps. 7,678 and Ps. 5,325, income before income taxes Ps. 486 and Ps. 334, depreciation and amortization Ps. 2,163 and Ps. 2,369, total assets Ps. 28,066 and Ps. 22,002, total liabilities Ps. 9,634 and Ps. 6,493, capital expenditures Ps. 3,342 and Ps. 1,778.