COCA COLA BOTTLING CO CONSOLIDATED /DE/ - 10-K Annual Report

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the fiscal year ended December 31, 1995

Commission file number 0-9286

COCA-COLA BOTTLING CO. CONSOLIDATED

(Exact name of Registrant as specified in its charter)

DELAWARE 56-0950585
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)

1900 REXFORD ROAD,
CHARLOTTE, NORTH CAROLINA 28211
(Address of principal executive offices)
(Zip Code)

(704) 551-4400
(Registrant's telephone number, including area code)

Securities Registered Pursuant to Section 12(b) of the Act: None
Securities Registered Pursuant to Section 12(g) of the Act:

Common Stock, $l.00 par value

(Title of Class)

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements,
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.

State the aggregate market value of voting stock held by non-affiliates of the
Registrant.

MARKET VALUE AS OF MARCH 14, 1996
Common Stock, $1 par value $241,681,000
Class B Common Stock, $1 par value *

* No market exists for the shares of Class B Common Stock, which is neither
registered under Section 12 of the Act nor subject to Section 15(d) of the Act.
The Class B Common Stock is convertible into Common Stock on a share for share
basis at the option of the holder.

Indicate the number of shares outstanding of each of the Registrant's classes
of common stock, as of the latest practicable date.

CLASS OUTSTANDING AS OF MARCH 14, 1996
Common Stock, $1 Par Value 7,958,059
Class B Common Stock, $1 Par Value 1,336,362

DOCUMENTS INCORPORATED BY REFERENCE

Proxy Statement to be filed pursuant to Section 14 of the Exchange Act with respect
to the 1996 Annual Meeting of Shareholders.......................................................... Part III, Items 10-13

PART I

ITEM 1 -- BUSINESS

INTRODUCTION AND RECENT DEVELOPMENTS

Coca-Cola Bottling Co. Consolidated, a Delaware corporation (the
"Company"), is engaged in the production, marketing and distribution of
carbonated and noncarbonated beverages, primarily products of The Coca-Cola
Company, Atlanta, Georgia ("The Coca-Cola Company"). The Company has been in the
soft drink manufacturing business since 1902.

The Company has grown significantly since 1984. In 1984, net sales were
$130.2 million. In 1995, net sales were $761.9 million. The Company's franchise
territory was concentrated in North Carolina prior to 1984. A series of
acquisitions since 1984 have significantly expanded the Company's franchise
territory. The most significant acquisitions were as follows:

(Bullet) February 8, 1985 -- Acquisition of various subsidiaries of Wometco
Coca-Cola Bottling Company which included franchise territories in
parts of Alabama, Tennessee and Virginia. Other noncontiguous
territories acquired in this acquisition were subsequently sold.

(Bullet) January 27, 1989 -- Acquisition of all of the outstanding stock of
The Coca-Cola Bottling Company of West Virginia, Inc. which
included franchise territory covering most of the state of West
Virginia.

(Bullet) December 20, 1991 -- Acquisition of all of the outstanding capital
stock of Sunbelt Coca-Cola Bottling Company, Inc. ("Sunbelt")
which included franchise territory covering parts of North
Carolina and South Carolina.

(Bullet) July 2, 1993 -- Formation of Piedmont Coca-Cola Bottling
Partnership ("Piedmont"). Piedmont is a joint venture owned
equally by the Company and The Coca-Cola Company through their
respective subsidiaries. Piedmont distributes and markets soft
drink products, primarily in parts of North Carolina and South
Carolina. The Company sold and contributed certain franchise
territories to Piedmont upon formation. The Company currently
provides part of the finished product requirements for Piedmont
and receives a fee for managing the operations of Piedmont
pursuant to a Management Agreement.

These transactions, along with several smaller acquisitions of additional
franchise territory, have resulted in the Company becoming the second largest
Coca-Cola bottler in the United States.

The Coca-Cola Company currently owns an economic interest of approximately
30% and a voting interest of approximately 23% in the Company. The Company sold
1,355,033 shares of newly issued Common Stock and 269,158 shares of Class B
Common Stock to The Coca-Cola Company in June 1987. An additional 1.1 million
shares of the Company's Common Stock were issued to The Coca-Cola Company on
January 27, 1989 in exchange for outstanding stock of The Coca-Cola Bottling
Company of West Virginia, Inc., and The Coca-Cola Company purchased an
additional 33,464 shares of Common Stock on June 25, 1993 pursuant to the
exercise of its right to maintain its proportionate voting and equity interests
in the Company under the terms of a Stock Rights and Restrictions Agreement
dated January 27, 1989.

The Company considers acquisition opportunities for additional territories
on an ongoing basis. To achieve its goals, further purchases and sales of
franchise rights and entities possessing such rights and other related
transactions designed to facilitate such purchases and sales may occur.

GENERAL

In its soft drink operations, the Company holds franchises under which it
produces and markets, in certain regions, carbonated soft drink products of The
Coca-Cola Company, including Coca-Cola classic, caffeine free Coca-Cola classic,
diet Coke, caffeine free diet Coke, Cherry Coke, TAB, Sprite, diet Sprite, Mello
Yello, diet Mello Yello, Mr. PiBB, Barq's Root Beer, Fresca, Minute Maid orange
and diet Minute Maid orange sodas. The Company also distributes and markets
POWERaDE, ready-to-drink Nestea, Fruitopia and Minute Maid Juices To Go in
certain of its markets. The Company produces and markets Dr Pepper in most of
its regions. Various other products, including Welch's flavors, Seagrams'
products and Sundrop are produced and marketed in one or more of the Company's
regions under franchise agreements with the companies that manufacture the
concentrate for those beverages. In addition, the Company also produces soft
drinks for other Coca-Cola franchise bottlers.

The Company's principal soft drink is Coca-Cola classic. During the last
three fiscal years, sales of products under the trademark Coca-Cola have
accounted for more than half of the Company's soft drink sales. In total, the
products of The Coca-Cola Company accounted for approximately 90% of the
Company's soft drink sales during fiscal 1995.

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FRANCHISES

The Company's franchises from The Coca-Cola Company entitle the Company to
produce and market The Coca-Cola Company's soft drinks in bottles, cans and five
gallon, pressurized, pre-mix containers. The Company is one of many companies
holding such franchises. The Coca-Cola Company is the sole owner of the secret
formulas pursuant to which the primary components (either concentrates or
syrups) of Coca-Cola trademark beverages are manufactured. The concentrates,
when mixed with water and sweetener, produce syrup which, when mixed with
carbonated water, produce the soft drinks known as "Coca-Cola," "Coca-Cola
classic," "Coke" and other soft drinks of The Coca-Cola Company which are
manufactured and marketed by the Company. The Company also purchases natural
sweeteners from The Coca-Cola Company. No royalty or other compensation is paid
under the franchise agreements to The Coca-Cola Company for the Company's right
to use in its territories the franchised tradenames and trademarks, such as
"Coca-Cola," "Coca-Cola classic" and "Coke," and their associated patents,
copyrights, designs and labels, all of which are owned by The Coca-Cola Company.
The Company has similar arrangements with the Dr Pepper Company and other
franchisors.

BOTTLE CONTRACTS. The Company is party to standard bottle contracts with
The Coca-Cola Company for each of its bottling territories (the "Bottle
Contracts") which provide that the Company will purchase its entire requirement
of concentrates and syrups for Coca-Cola, Coca-Cola classic, caffeine free
Coca-Cola classic, Cherry Coke, diet Coke, caffeine free diet Coke and diet
Cherry Coke (together, the "Coca-Cola Trademark Beverages") from The Coca-Cola
Company. The Company has the exclusive right to distribute Coca-Cola Trademark
Beverages for sale in its territories in authorized containers of the nature
currently used by the Company, which include cans and returnable and
non-returnable bottles. The Coca-Cola Company may determine from time to time
what containers of this type to authorize for use by the Company.

The price The Coca-Cola Company may charge for syrup or concentrate under
the Bottle Contracts is set by The Coca-Cola Company from time to time. Except
as provided in the Supplementary Agreement described below, there are no
limitations on prices for concentrate or syrup. Consequently, the prices at
which the Company purchases concentrates and syrup under the Bottle Contracts
may vary materially from the prices it has paid during the periods covered by
the financial information included in this report.

Under the Bottle Contracts, the Company is obligated to maintain such
plant, equipment, staff and distribution facilities as are required for the
manufacture, packaging and distribution of the Coca-Cola Trademark Beverages in
authorized containers, and in sufficient quantities to satisfy fully the demand
for these beverages in its territories; to undertake adequate quality control
measures and maintain sanitation standards prescribed by The Coca-Cola Company;
to develop, to stimulate, and to satisfy fully the demand for Coca-Cola
Trademark Beverages and to use all approved means, and to spend such funds on
advertising and other forms of marketing, as may be reasonably required to meet
that objective; and to maintain such sound financial capacity as may be
reasonably necessary to assure performance by the Company and its affiliates of
their obligations to The Coca-Cola Company.

The Bottle Contracts require the Company to submit to The Coca-Cola Company
each year its plans for marketing, management and advertising with respect to
the Coca-Cola Trademark Beverages for the ensuing year. Such plans must
demonstrate that the Company has the financial capacity to perform its duties
and obligations to The Coca-Cola Company under the Bottle Contracts. The Company
must obtain The Coca-Cola Company's approval of those plans, which approval may
not be unreasonably withheld, and if the Company carries out its plan in all
material respects, it will have satisfied its contractual obligations. Failure
to carry out such plans in all material respects would constitute an event of
default that, if not cured within 120 days of notice of such failure, would give
The Coca-Cola Company the right to terminate the Bottle Contracts. If the
Company at any time fails to carry out a plan in all material respects with
respect to any geographic segment (as defined by The Coca-Cola Company) of its
territory, and if that failure is not cured within six months of notice of such
failure, The Coca-Cola Company may reduce the territory covered by the
applicable Bottle Contract by eliminating the portion of the territory with
respect to which the failure has occurred.

The Coca-Cola Company has no obligation under the Bottle Contracts to
participate with the Company in expenditures for advertising and marketing. As
it has in the past, The Coca-Cola Company may contribute to such expenditures
and undertake independent advertising and marketing activities, as well as
cooperative advertising and sales promotion programs which require mutual
cooperation and financial support of the Company. The future levels of marketing
support and promotional funds provided by The Coca-Cola Company may vary
materially from the levels provided during the periods covered by the financial
information included in this report.

The Coca-Cola Company has the right to reformulate any of the Coca-Cola
Trademark Beverages and to discontinue any of the Coca-Cola Trademark Beverages,
subject to certain limitations, so long as all Coca-Cola Trademark Beverages are

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not discontinued. The Coca-Cola Company may also introduce new beverages under
the trademarks "Coca-Cola" or "Coke" or any modification thereof, and in that
event the Company would be obligated to manufacture, package, distribute and
sell the new beverages with the same duties as exist under the Bottle Contracts
with respect to Coca-Cola Trademark Beverages.

If the Company acquires the right to manufacture and sell Coca-Cola
Trademark Beverages in any additional territory, the Company has agreed that
such new territory will be covered by a standard contract in the same form as
the Bottle Contracts and that any existing agreement with respect to the
acquired territory automatically shall be amended to conform to the terms of the
Bottle Contracts. In addition, if the Company acquires control, directly or
indirectly, of any bottler of Coca-Cola Trademark Beverages, or any party
controlling a bottler of Coca-Cola Trademark Beverages, the Company must cause
the acquired bottler to amend its franchises for the Coca-Cola Trademark
Beverages to conform to the terms of the Bottle Contracts.

The Bottle Contracts are perpetual, subject to termination by The Coca-Cola
Company in the event of default by the Company. Events of default by the Company
include (1) the Company's insolvency, bankruptcy, dissolution, receivership or
similar conditions; (2) the Company's disposition of any interest in the
securities of any bottling subsidiary without the consent of The Coca-Cola
Company; (3) termination of any agreement regarding the manufacture, packaging,
distribution or sale of Coca-Cola Trademark Beverages between The Coca-Cola
Company and any person that controls the Company; (4) any material breach of any
obligation occurring under the Bottle Contracts (including, without limitation,
failure to make timely payment for any syrup or concentrate or of any other debt
owing to The Coca-Cola Company, failure to meet sanitary or quality control
standards, failure to comply strictly with manufacturing standards and
instructions, failure to carry out an approved plan as described above, and
failure to cure a violation of the terms regarding imitation products), that
remains uncured for 120 days after notice by The Coca-Cola Company; or (5)
producing, manufacturing, selling or dealing in any "Cola Product," as defined,
or any concentrate or syrup which might be confused with those of The Coca-Cola
Company; or (6) selling any product under any trade dress, trademark, or
tradename or in any container in which The Coca-Cola Company has a proprietary
interest; or (7) owning any equity interest in or controlling any entity which
performs any of the activities described in (5) or (6) above. In addition, upon
termination of the Bottle Contracts for any reason, The Coca-Cola Company, at
its discretion, may also terminate any other agreements with the Company
regarding the manufacture, packaging, distribution, sale or promotion of soft
drinks, including the Allied Bottle Contracts described elsewhere herein.

The Company is prohibited from assigning, transferring or pledging its
Bottle Contracts, or any interest therein, whether voluntarily or by operation
of law, without the prior consent of The Coca-Cola Company. Moreover, the
Company may not enter into any contract or other arrangement to manage or
participate in the management of any other Coca-Cola bottler without the prior
consent of The Coca-Cola Company.

The Coca-Cola Company may automatically amend the Bottle Contracts if 80%
of the domestic bottlers who are parties to agreements with The Coca-Cola
Company containing substantially the same terms as the Bottle Contracts, which
bottlers purchased for their own account 80% of the syrup and equivalent gallons
of concentrate for Coca-Cola Trademark Beverages purchased for the account of
all such bottlers, agree that their bottle contracts shall be likewise amended.

SUPPLEMENTARY AGREEMENT. The Company and The Coca-Cola Company are also
parties to a Supplementary Agreement (the "Supplementary Agreement") that
modifies some of the provisions of the Bottle Contracts. The Supplementary
Agreement provides that The Coca-Cola Company will exercise good faith and fair
dealing in its relationship with the Company under the Bottle Contracts; offer
marketing support and exercise its rights under the Bottle Contracts in a manner
consistent with its dealings with comparable bottlers; offer to the Company any
written amendment to the Bottle Contracts (except amendments dealing with
transfer of ownership) which it offers to any other bottler in the United
States; and, subject to certain limited exceptions, sell syrups and concentrates
to the Company at prices no greater than those charged to other bottlers which
are parties to contracts substantially similar to the Bottle Contracts.

The Supplementary Agreement permits transfers of the Company's capital
stock that would otherwise be limited by the Bottle Contracts.

ALLIED BOTTLE CONTRACTS. Other contracts with The Coca-Cola Company (the
"Allied Bottle Contracts") grant similar exclusive rights to the Company with
respect to the distribution of Sprite, Mr. PiBB, Mello Yello, diet Mello Yello,
Fanta, TAB, diet Sprite, sugar free Mr. PiBB, Fresca, Minute Maid orange and
diet Minute Maid orange sodas (the "Allied Beverages") for sale in authorized
containers in its territories. These contracts contain provisions that are
similar to those of the Bottle Contracts with respect to pricing, authorized
containers, planning, quality control, trademark and transfer restrictions and
related matters. Each Allied Bottle Contract has a term of 10 years and is
renewable by the Company for an additional 10

3

years at the end of each 10 year period, but is subject to termination in the
event of (1) the Company's insolvency, bankruptcy, dissolution, receivership or
similar condition; (2) termination of the Company's Bottle Contract covering the
same territory by either party for any reason; and (3) any material breach of
any obligation of the Company under the Allied Bottle Contract that remains
uncured for 120 days after notice by The Coca-Cola Company. The Coca-Cola
Company recently purchased Barq's, Inc. from whom the Company has been granted
rights to manufacture and market Barq's Root Beer. The Bottler's Agreement
between the Company and Barq's, Inc. remains in effect and The Coca-Cola Company
has not informed the Company of any intention to replace it.

POST-MIX RIGHTS. The Company also has the non-exclusive right to sell
Coca-Cola classic and other fountain syrups ("post-mix syrup") of The Coca-Cola
Company.

OTHER BOTTLING AGREEMENTS. The bottling agreements from most other soft
drink franchisors are similar to those described above in that they are
renewable at the option of the Company and the franchisors at prices
unilaterally fixed by the franchisors. They also contain similar restrictions on
the use of trademarks, approved bottles, cans and labels and sale of imitations
or substitutes as well as termination for cause provisions. Sales of beverages
by the Company under these agreements represented approximately 10% of the
Company's sales for fiscal 1995.

The territories covered by the Allied Bottle Contracts and by bottling
agreements for products of franchisors other than The Coca-Cola Company in most
cases correspond with the territories covered by the Bottle Contracts. The
variations do not have a material effect on the business of the Company taken as
a whole.

MARKETS AND PRODUCTION AND DISTRIBUTION FACILITIES

As of March 14, 1996, the Company held franchises from The Coca-Cola
Company covering the majority of central, northern and western North Carolina,
and portions of Alabama, Mississippi, Tennessee, Kentucky, Virginia, West
Virginia, Ohio, Pennsylvania, Georgia and Florida. The total population within
the Company's franchise territory is approximately 12.1 million.

As of March 14, 1996, the Company operated in six principal geographical
regions. Certain information regarding each of these markets follows:

1. NORTH CAROLINA. This region includes the majority of central and western
North Carolina, including Raleigh, Greensboro, Winston-Salem, High Point,
Hickory, Asheville, Fayetteville and Charlotte and the surrounding areas. The
region has an estimated population of 5.2 million. Production/distribution
facilities are located in Charlotte and 15 other distribution facilities are
located in the region.

2. SOUTH ALABAMA. This region includes a portion of southwestern Alabama,
including the area surrounding Mobile, and a portion of southeastern
Mississippi. The region has an estimated population of 900,000. A
production/distribution facility is located in Mobile, and five other
distribution facilities are located in the region.

3. SOUTH GEORGIA. This region includes a small portion of eastern Alabama,
a portion of southwestern Georgia surrounding Columbus, Georgia, in which a
distribution facility is located, and a portion of the Florida Panhandle,
including Panama City and Quincy. Four other distribution facilities are located
in the region. This region has an estimated population of 1.0 million.

4. MIDDLE TENNESSEE. This region includes a portion of central Tennessee,
including areas surrounding Nashville, and a small portion of southern Kentucky.
The region has an estimated population of 1.6 million. A production/distribution
facility is located in Nashville and seven other distribution facilities are
located in the region.

5. WESTERN VIRGINIA. This region includes most of southwestern Virginia,
including areas surrounding Roanoke, a portion of the southern piedmont of
Virginia, a portion of northeastern Tennessee and a portion of southeastern West
Virginia. The region has an estimated population of 1.5 million. A
production/distribution facility is located in Roanoke and seven other
distribution facilities are located in the region.

6. WEST VIRGINIA. This region includes most of the state of West Virginia,
a portion of eastern Kentucky, a portion of eastern Ohio and a portion of
southwestern Pennsylvania. The region has an estimated population of 1.9
million. There are 11 distribution facilities located in the region.

The Company owns 100% of the operations in each of the regions listed.

4

The Company sold the majority of its South Carolina franchise territory to
Piedmont in July 1993. Pursuant to a Management Agreement, the Company produces
a portion of the soft drink products for Piedmont. The Company currently owns a
50% interest in Piedmont. Piedmont's franchise territory covers parts of eastern
North Carolina and most of South Carolina. This region has an estimated
population of 4.1 million.

On June 1, 1994, the Company executed a management agreement with South
Atlantic Canners, Inc. ("SAC"), a manufacturing cooperative located in
Bishopville, South Carolina. The Company is a member of the cooperative and
receives a fee for managing the day-to-day operations of SAC pursuant to a
10-year Management Agreement. SAC has significantly expanded its operations by
adding two PET bottling lines. The new bottling lines supply a portion of the
Company's and Piedmont's volume requirements for PET product. The Company
executed member purchase agreements with SAC that require minimum annual
purchases of canned product, 20 ounce PET product, 2 liter PET product and 3
liter PET product by the Company. Products purchased pursuant to these member
purchase agreements total approximately $40 million on an annual basis.

In addition to producing bottled and canned soft drinks for the Company's
franchise territories, each production facility also produces some products for
sale by other Coca-Cola bottlers. With the exception of the Company's production
of soft drink products for Piedmont, this contract production is currently not
material in the Company's production centers.

RAW MATERIALS

In addition to concentrates obtained by the Company from The Coca-Cola
Company and other concentrate companies for use in its soft drink manufacturing,
the Company also purchases sweeteners, carbon dioxide, glass and plastic
bottles, cans, closures, pre-mix containers and other packaging materials as
well as equipment for the production, distribution and marketing of soft drinks.
Except for sweetener, cans and plastic bottles, the Company purchases its raw
materials from multiple suppliers.

The cost of aluminum cans increased significantly at the beginning of 1995
as a result of increases in the price of aluminum ingot. The Company entered
into supply agreements in the fourth quarter of 1995 with its aluminum can
suppliers which require the Company to purchase the majority of its aluminum can
requirements for two of its four manufacturing facilities. These agreements,
which extend through the end of 2000, also reduce the variability of the cost of
cans for these two facilities.

The Company purchases substantially all of its plastic bottles (20 ounce, 1
liter, 2 liter and 3 liter sizes) from manufacturing plants which are owned and
operated by two cooperatives of Coca-Cola bottlers, including the Company. The
Company joined the southwest cooperative in February 1985 following its
acquisition of the bottling subsidiaries of Wometco Coca-Cola Bottling Company.
The Company joined the southeast cooperative in 1984.

None of the materials or supplies used by the Company is in short supply,
although the supply of specific materials could be adversely affected by
strikes, weather conditions, governmental controls or national emergency
conditions.

MARKETING

The Company's soft drink products are sold and distributed directly by its
employees to retail stores and other outlets, including food markets,
institutional accounts and vending machine outlets. During 1995, approximately
75% of the Company's total sales were made in the take-home channel through
supermarkets, convenience stores and other retail outlets. The remaining sales
were made in the cold drink channel, primarily through dispensing machines,
owned either by the Company, retail outlets or third party vending companies.

New product introductions, packaging changes and sales promotions have been
the major competitive techniques in the soft drink industry in recent years and
have required and are expected to continue to require substantial expenditures.
New product introductions in recent years include: caffeine free Coca-Cola
classic; caffeine free diet Coke; Cherry Coke; diet Mello Yello; Minute Maid
orange; diet Minute Maid orange; ready-to-drink Nestea; Fruitopia; POWERaDE; and
Minute Maid Juices To Go. New product introductions have entailed increased
operating costs for the Company resulting from special marketing efforts,
obsolescence of replaced items and, occasionally, higher raw materials costs.

After several new package introductions in recent years, the Company now
sells its soft drink products in a variety of returnable and non-returnable
bottles, both glass and plastic, and in cans, in varying proportions from market
to market. There may be as many as eight different packages for Coca-Cola
classic within a single geographical area. Physical unit sales of soft drinks
during fiscal year 1995 were approximately 48% cans, 49% non-returnable bottles,
2% pre-mix and 1% returnable bottles.

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Advertising in various media, primarily television and radio, is relied
upon extensively in the marketing of the Company's soft drinks. The Coca-Cola
Company and Dr Pepper Company have joined the Company in making substantial
expenditures in cooperative advertising in the Company's marketing areas. The
Company also benefits from national advertising programs conducted by The
Coca-Cola Company and Dr Pepper Company. In addition, the Company expends
substantial funds on its own behalf for extensive local sales promotions of the
Company's soft drink products. These expenses are partially offset by marketing
funds which the concentrate companies provide to the Company in support of a
variety of marketing programs, such as price promotions, merchandising programs
and point-of-sale displays.

The substantial outlays which the Company makes for advertising are
generally regarded as necessary to maintain or increase sales volume, and any
curtailment of the funding provided by The Coca-Cola Company for advertising or
marketing programs which benefit the Company could have a material effect on the
business of the Company.

SEASONALITY

Sales are somewhat seasonal, with the highest sales volume occurring in
May, June, July and August. The Company has adequate production capacity to meet
sales demands during these peak periods.

COMPETITION

The soft drink industry is highly competitive. The Company's competitors
include several large soft drink manufacturers engaged in the distribution of
nationally advertised products, as well as similar companies which market
lesser-known soft drinks in limited geographical areas and manufacturers of
private brand soft drinks. In each region in which the Company operates, between
75% and 95% of carbonated soft drink sales in bottles, cans and pre-mix
containers are accounted for by the Company and its principal competition, which
in each region includes the local bottler of Pepsi-Cola and, in some regions,
also includes the local bottler of Royal Crown products. The Company's
carbonated beverage products also compete with, among others, noncarbonated
beverages and citrus and noncitrus fruit drinks.

The principal methods of competition in the soft drink industry are
point-of-sale merchandising, new product introductions, packaging changes, price
promotions, quality of distribution and advertising.

GOVERNMENT REGULATION

The production and marketing of beverages are subject to the rules and
regulations of the United States Food and Drug Administration ("FDA") and other
federal, state and local health agencies. The FDA also regulates the labeling of
containers.

No reformulation of the Company's products is presently required by any
rule or regulation, but there can be no assurance that future government
regulations will not require reformulation of the Company's products.

From time to time, legislation has been proposed in Congress and by certain
state and local governments which would prohibit the sale of soft drink products
in non-returnable bottles and cans or require a mandatory deposit as a means of
encouraging the return of such containers in an attempt to reduce solid waste
and litter. The Company is currently not impacted by this type of proposed
legislation.

Soft drink and similar-type taxes have been in place in North Carolina,
South Carolina, West Virginia and Tennessee for several years. To the Company's
knowledge, legislation has not been proposed or enacted to increase the tax in
West Virginia or Tennessee. The North Carolina soft drink tax will be reduced by
25% beginning July 1, 1996. The South Carolina soft drink tax has been repealed
and will be phased out over a six-year period beginnning July 1, 1996.

ENVIRONMENTAL REMEDIATION

The Company does not currently have any material capital expenditure
commitments for environmental remediation for any of its properties.

EMPLOYEES

As of March 14, 1996, the Company had a total of approximately 4,800
full-time employees, of whom approximately 400 were union members. Management of
the Company believes that the Company's relations with its employees are
generally good.

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ITEM 2 -- PROPERTIES

The principal properties of the Company include its corporate headquarters,
its four production facilities and its 54 distribution centers, all of which are
owned by the Company except for its corporate headquarters, two
production/distribution facilities and nine distribution centers.

On November 30, 1992, the Company and the owner of the Company's Snyder
Production Center in Charlotte, North Carolina agreed to the early termination
of the Company's lease. Harrison Limited Partnership One purchased the property
contemporaneously with the termination of the lease, and the Company and
Harrison Limited Partnership One entered into an agreement under which the
Company leased the property for a 10-year term beginning on December 1, 1992.
JFH Management, Inc., a North Carolina corporation of which J. Frank Harrison,
Jr. is the sole shareholder, serves as sole general partner of the limited
partnership that purchased the production center property. The sole limited
partner of the limited partnership is a trust as to which J. Frank Harrison, III
and Reid M. Henson are co-trustees, share investment powers, and as to which
they share voting power for purposes of this partnership interest. The
beneficiaries of this trust are J. Frank Harrison, Jr. and his descendants. The
annual base rent the Company is obligated to pay under the lease agreement is
subject to adjustment for increases in the Consumer Price Index and for
increases or decreases in interest rates based on London Interbank Offered Rate
("LIBOR").

On June 1, 1993, Beacon Investment Corporation, a North Carolina
corporation of which J. Frank Harrison, III is sole shareholder, purchased the
office building located on Rexford Road in Charlotte, North Carolina, in which
the Company leases its executive offices. Contemporaneously, the Company entered
into a 10-year lease commencing June 1, 1993 with Beacon Investment Corporation
for office space within the building. The annual base rent the Company is
obligated to pay under the lease agreement is subject to adjustment for
increases in the Consumer Price Index and for increases or decreases in interest
rates based on LIBOR.

The Company also leases its 297,500 square-foot production/distribution
facility in Nashville, Tennessee. The lease requires monthly payments through
2002. The Company's other real estate leases are not material.

The Company owns and operates two soft drink production facilities apart
from the leased facilities described above. The current percentage utilization
of the Company's production centers as of March 14, 1996 is approximately as
indicated below:

PRODUCTION FACILITIES

PERCENTAGE
LOCATION UTILIZATION*

Charlotte, North Carolina................................................................ 84%
Mobile, Alabama.......................................................................... 81%
Nashville, Tennessee..................................................................... 63%
Roanoke, Virginia........................................................................ 74%

* Estimated 1996 production divided by capacity (based on 80 hours of operations
per week).

The Company currently has sufficient production capacity to meet its
operational requirements. In addition to the production facilities noted above,
the Company also has access to production capacity from South Atlantic Canners,
Inc.

Bottled and canned soft drinks are transported to distribution centers for
storage pending sale. The number of centers by market area as of March 14, 1996
is as follows:

DISTRIBUTION CENTERS

NUMBER OF
REGION CENTERS

North Carolina............................................................................ 16
South Alabama............................................................................. 6
South Georgia............................................................................. 5
Middle Tennessee.......................................................................... 8
Western Virginia.......................................................................... 8
West Virginia............................................................................. 11

7

The Company's distribution facilities are all in good condition and are
adequate for the Company's operations as presently conducted.

The Company also operates approximately 2,600 vehicles in the sale and
distribution of its soft drink products, of which approximately 1,400 are
delivery trucks. In addition, the Company owns or leases approximately 113,000
soft drink dispensing and vending machines.

ITEM 3 -- LEGAL PROCEEDINGS

On March 4, 1993, a Complaint was filed against the Company, the
predecessor bottling company for the Laurel, Mississippi territory and other
unnamed parties by the testatrix spouse of a deceased former employee of the
predecessor bottler. This suit alleges misrepresentation and fraud in connection
with the severance package offered to employees terminated by the predecessor
bottler in connection with the acquisition of the Laurel franchise subsidiary of
the Company. Plaintiff seeks damages in an amount up to $18 million in
compensatory and punitive damages. The Company believes that the Complaint is
without merit and its ultimate disposition will not have a material adverse
effect on the financial condition or results of operations of the Company.

ITEM 4 -- SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

There were no matters submitted to a vote of security holders during the
fourth quarter of the fiscal year ended December 31, 1995.

EXECUTIVE OFFICERS OF THE REGISTRANT

Pursuant to General Instruction G(3) of Form 10-K, the following list is
included as an unnumbered item in Part I of this Report in lieu of being
included in the Proxy Statement for the Annual Meeting of Shareholders to be
filed.

The following is a list of names and ages of all the executive officers of
the Registrant as of March 14, 1996, indicating all positions and offices with
the Registrant held by each such person. All officers have served in their
present capacities for the past five years except as otherwise stated.

J. FRANK HARRISON, JR., age 65, is Chairman of the Board of Directors of
the Company and has served the Company in that capacity since 1977. Mr.
Harrison, Jr. served as Chief Executive Officer of the Company from August 1980
until April 1983. He has previously served the Company as Vice Chairman of the
Board of Directors. He has been a Director of the Company since 1973. Mr.
Harrison, Jr. presently is a Director of Dixie Yarns, Inc. Mr. Harrison, Jr. is
Chairman of the Executive Committee and the Finance Committee and is a member of
the Compensation Committee.

J. FRANK HARRISON, III, age 41, is a Vice Chairman of the Board of
Directors and Chief Executive Officer of the Company. Mr. Harrison has served in
the capacity of Vice Chairman since his election in November 1987 and was
appointed as the Company's Chief Executive Officer in May 1994. He was first
employed by the Company in 1977, and has served as a Division Sales Manager and
as a Vice President of the Company. Mr. Harrison, III is a Director of Wachovia
Bank & Trust Co., N.A., Southern Region Board. He is Chairman of the
Compensation Committee and is a member of the Executive Committee, the Audit
Committee and the Finance Committee.

REID M. HENSON, age 56, has served as a Vice Chairman of the Board of
Directors of the Company since 1983. Prior to that time, Mr. Henson served as a
consultant for JTL Corporation, a management company, and later as President of
JTL Corporation. He has been a Director of the Company since 1979, is Chairman
of the Audit Committee and is a member of the Executive Committee, the
Retirement Benefits Committee and the Finance Committee.

JAMES L. MOORE, JR., age 53, is President and Chief Operating Officer of
the Company. Prior to his election as President in March 1987, he served as
President and Chief Executive Officer of Atlantic Soft Drink Co., a soft drink
bottling subsidiary of Grand Metropolitan USA. Mr. Moore has been a Director of
the Company since March 1987. He is a member of the Executive Committee and is
Chairman of the Retirement Benefits Committee.

DAVID V. SINGER, age 40, is Vice President and Chief Financial Officer. In
addition to his Finance duties, Mr. Singer has overall responsibility for the
Company's Purchasing/Materials Management function as well as the Manufacturing
function. He served as Vice President, Chief Financial Officer and Treasurer
from October 1987 through May 1992; prior to that he was Vice President and
Treasurer. Prior to joining the Company in March 1986, Mr. Singer was a Vice
President of Corporate Banking for Mellon Bank, N.A.

8

M. CRAIG AKINS, age 45, is Vice President, Cold Drink Market, a position he
has held since October 1993. He was Vice President, Division Manager of the
Tennessee Division from 1989-1993. From 1987 through 1988, he was General
Manager of the Nashville, TN sales center. From 1985 through 1986, he was Trade
Development Director of the Tennessee Division. Prior to joining the Company in
1985, he was a Regional Trade Development Manager for Coca-Cola USA.

STEVEN D. CALDWELL, age 46, joined the Company in April 1987 as Vice
President, Business Systems and Services. Prior to joining the Company, he was
Director of MIS at Atlantic Soft Drink Co., a soft drink bottling subsidiary of
Grand Metropolitan USA for four years.

WILLIAM B. ELMORE, age 40, is Vice President, Regional Manager for the
Virginia Division, West Virginia Division and Tennessee Division, a position he
has held since November 1991. He was Vice President, Division Manager of the
West Virginia Division from 1989-1991. He was Senior Director, Corporate
Marketing from 1988-1989. Preceding that, he held various positions in sales and
marketing in the Charlotte Division from 1985-1988. Before joining the Company
in 1985, he was employed by Coca-Cola USA for seven years where he held several
positions in their field sales organization.

NORMAN C. GEORGE, age 40, is Vice President, Regional Manager for the
Carolinas South Region, a position he has held since November 1991. He served as
Vice President, Division Manager of the Southern Division from 1988-1991. He
served as Vice President, Division Manager of the Alabama Division from
1986-1988. From 1982-1986, he served as Director of Sales and Operations in the
Northern Division. Prior to joining the Company in 1982, he was Sales Manager of
the Dallas-Fort Worth Dr Pepper Bottling Company in Irving, Texas.

BRENDA B. JACKSON, age 35, is Vice President and Treasurer, a position she
has held since January 1993. From February 1992 until her promotion, she served
as Assistant Treasurer. Mrs. Jackson joined the Company in March 1989 as
Director of Finance.

UMESH M. KASBEKAR, age 38, is Vice President, Planning and Administration,
a position he has held since December 1994. He was Vice President, Planning from
December 1988 until December 1994. He was first employed by the Company in 1983
and held various other positions with the Company from 1983 to 1988.

C. RAY MAYHALL, age 48, is Vice President, Regional Manager for the Georgia
Division, Alabama Division and the Carolinas North Region, a position he has
held since November 1991. He served as Vice President, Division Manager of the
Northern Division from 1989-1991. Before joining the Company in 1989, he was
Vice President, Sales and Marketing of Florida Coca-Cola Bottling Company, a
position he had held since 1987. Prior to 1987, he was Division Manager of the
Central Florida Division of Florida Coca-Cola Bottling Company for six years.

ROBERT D. PETTUS, JR., age 51, is Vice President, Human Resources, a
position he has held since September 1984. Prior to joining the Company, he was
Director, Employee Relations for the Texize Division of Morton-Thiokol for seven
years.

JAMES B. STUART, age 53, joined the Company in October 1990 as Vice
President, Marketing. Mr. Stuart had been Senior Vice President, Sales and
Marketing with JTL Corporation from 1980 until such company was acquired by The
Coca-Cola Company in 1986. From 1987 until joining the Company in 1990, Mr.
Stuart formed his own marketing company, serving a number of clients inside and
outside the soft drink industry. During this period, he worked almost
exclusively with the International Business Sector of The Coca-Cola Company.

STEVEN D. WESTPHAL, age 41, is Vice President and Controller of the
Company, a position he has held since November 1987. Prior to joining the
Company, he was Vice President-Finance for Joyce Beverages, an independent
bottler, beginning in January 1985. Prior to working for Joyce Beverages, he was
Director of Corporate Planning for Mid-Atlantic Coca-Cola Bottling Company, Inc.
from December 1981 to December 1984.

9

PART II

ITEM 5 -- MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The Company has two classes of common stock outstanding, Common Stock and
Class B Common Stock. The Common Stock is traded on the Nasdaq National Market
tier of the Nasdaq Stock MarketSM under the symbol COKE. The table below sets
forth for the periods indicated the high and low reported sales prices per share
of Common Stock. There is no established public trading market for the Class B
Common Stock. Shares of Class B Common Stock are convertible on a
share-for-share basis into shares of Common Stock.

FISCAL YEAR
1995
HIGH LOW

First quarter.............................................................................. $ 29 3/4 $ 26
Second quarter............................................................................. 32 3/4 29 1/4
Third quarter.............................................................................. 35 7/8 31
Fourth quarter............................................................................. 35 1/2 33 1/4

1994
HIGH LOW

First quarter.............................................................................. $ 37 1/4 $ 27
Second quarter............................................................................. 30 1/4 24
Third quarter.............................................................................. 31 26 3/4
Fourth quarter............................................................................. 29 3/4 24

On February 8, 1994, the Board of Directors declared an increase in the
first quarter 1994 dividends. Shareholders of record as of February 24, 1994
received $.25 per share on both their Common Stock and Class B Common Stock
shares, payable on March 10, 1994. This dividend rate was maintained throughout
1994 and 1995.

Pursuant to the Company's Certificate of Incorporation, no cash dividend or
dividend of property or stock other than stock of the Company may be declared
and paid, per share, on the Class B Common Stock unless a dividend of an amount
greater than or equal to such cash or property or stock has been declared and
paid on the Common Stock. Reference should be made to Article Fourth of the
Company's Certificate of Incorporation for additional provisions relating to the
relative dividend rights of holders of Common Stock and Class B Common Stock.

The amount and frequency of future dividends will be determined by the
Company's Board of Directors in light of the earnings and financial condition of
the Company at such time, and no assurance can be given that dividends will be
declared in the future.

The number of shareholders of record of the Common Stock and Class B Common
Stock, as of March 14, 1996, was 1,171 and 14, respectively.

ITEM 6 -- SELECTED FINANCIAL DATA

The following table sets forth certain selected financial data concerning
the Company for the five years ended December 31, 1995. The data for the five
years ended December 31, 1995 is unaudited but is derived from audited
statements of the Company. This information should be read in conjunction with
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" set forth in Item 7 hereof and is qualified in its entirety by
reference to the more detailed financial statements and notes contained in Item
8 hereof. This information should also be read in conjunction with the
"Introduction and Recent Developments" section in Item 1 hereof which details
the Company's significant acquisitions and divestitures since 1984.

10

SELECTED FINANCIAL DATA*

IN THOUSANDS (EXCEPT PER SHARE DATA)

FISCAL YEAR
SUMMARY OF OPERATIONS 1995 1994 1993 1992 1991

Net sales....................................................... $761,876 $723,896 $686,960 $ 655,778 $464,733
Cost of products sold........................................... 447,636 427,140 396,077 372,865 262,887
Selling expenses................................................ 158,831 149,992 144,411 151,382 107,266
General and administrative expenses............................. 54,720 54,559 51,125 47,154 37,995
Depreciation expense............................................ 26,746 24,188 23,284 22,217 18,785
Amortization of goodwill and intangibles........................ 12,230 12,309 14,784 18,326 10,884
Total costs and expenses........................................ 700,163 668,188 629,681 611,944 437,817
Income from operations.......................................... 61,713 55,708 57,279 43,834 26,916
Interest expense................................................ 33,091 31,385 30,994 36,862 21,556
Other income (expense), net..................................... (3,401) 63 (2,270) (2,121) (2,404)
Income before income taxes, extraordinary charge and effect of
accounting changes............................................ 25,221 24,386 24,015 4,851 2,956
Federal and state income taxes.................................. 9,685 10,239 9,182 2,768 20
Income before extraordinary charge and effect of accounting
changes....................................................... 15,536 14,147 14,833 2,083 2,936
Extraordinary charge............................................ (5,016)
Effect of accounting changes.................................... (2,211) (116,199)
Net income (loss)............................................... 10,520 11,936 14,833 (114,116) 2,936
Preferred stock dividends....................................... 4,195 728
Net income (loss) applicable to common shareholders............. $ 10,520 $ 11,936 $ 14,833 $(118,311) $ 2,208
Income (loss) per share:
Income (loss) before extraordinary charge and effect of
accounting changes......................................... $ 1.67 $ 1.52 $ 1.60 $ (.23) $ .24
Extraordinary charge.......................................... (.54)
Effect of accounting changes.................................. (.24) (12.66)
Net income (loss) applicable to common shareholders........... $ 1.13 $ 1.28 $ 1.60 $ (12.89) $ .24
Cash dividends per share:
Common........................................................ $ 1.00 $ 1.00 $ .88 $ .88 $ .88
Class B Common................................................ $ 1.00 $ 1.00 $ .52 $ .52 $ .52

YEAR-END FINANCIAL POSITION
Total assets.................................................... $676,571 $664,159 $648,449 $ 785,871 $785,196
Long-term debt.................................................. 419,896 432,971 434,358 555,126 479,414
Redeemable preferred stock...................................... 7,280
Shareholders' equity............................................ 38,972 33,981 29,629 25,806 205,426

OTHER INFORMATION
Weighted average number of Common and Class B Common shares
outstanding................................................... 9,294 9,294 9,258 9,181 9,181

* All years presented are 52-week years except for 1992 which is a 53-week
year. In December 1991, the Company acquired Sunbelt Coca-Cola Bottling Company,
Inc. See Note 2 to the consolidated financial statements for information
concerning the Company's investment in Piedmont Coca-Cola Bottling Partnership.
During 1992, the Company changed its method of accounting for income taxes and
for postretirement benefits other than pensions. In 1994, the Company changed
its method of accounting for postemployment benefits, as described in Note 12.
In 1995, the Company recorded an extraordinary charge related to the repurchase
at a premium of a portion of the Company's long-term debt, as described in Note
6.

11

ITEM 7 -- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

INTRODUCTION

Coca-Cola Bottling Co. Consolidated (the "Company") is engaged in the
production, marketing and distribution of soft drinks, primarily products of The
Coca-Cola Company. Since 1984, the Company has expanded its franchise territory
throughout the Southeast, primarily through acquisitions.

The current year provided significant challenges for the Company, with
substantial price increases for raw materials and a rise in short term interest
rates. The Company experienced increased packaging costs for both aluminum cans
and plastic bottles. The Company was able to offset these cost increases by
generating higher volume and increased net selling prices. The net selling price
increased by approximately 4%. Franchise sales volume increased by 5% over 1994.
The introduction of the 20 ounce contour bottle throughout the Company's
franchise territory contributed to the successful increases in both sales volume
and net selling prices. Interest expense increased by $1.7 million due to higher
short-term interest rates more than offsetting the interest savings resulting
from the $13 million reduction in long-term debt.

Capital expenditures of $37 million in 1995 and $49 million in 1994 were
made to maintain the Company's physical asset base as well as providing the
Company with the opportunity to take advantage of new packages and higher margin
channels.

On November 1, 1995, the Company issued $100 million of 6.85% debentures
under its $400 million shelf registration filed with the Securities and Exchange
Commission in 1994. The proceeds from the issuance of the debentures were used
for the early retirement of approximately $87 million of the Company's
Medium-Term Notes which matured between 1999 and 2002 and with varying rates of
interest from 7.99% to 10.00%. In conjunction with the early retirement of the
Medium-Term Notes, the Company recorded an after tax extraordinary charge of
$5.0 million or $.54 per share for 1995. This refinancing has allowed the
Company to take advantage of lower long-term interest rates.

On July 2, 1993, the Company and The Coca-Cola Company formed Piedmont
Coca-Cola Bottling Partnership ("Piedmont") to distribute and market soft drink
products of The Coca-Cola Company and other third party licensors, primarily in
certain portions of North Carolina and South Carolina. The Company provides a
portion of the soft drink products to Piedmont at cost and receives a fee for
managing the business of Piedmont pursuant to a management agreement. The
Company and The Coca-Cola Company, through their respective subsidiaries, each
beneficially own a 50% interest in Piedmont. The Company is accounting for its
investment in Piedmont using the equity method of accounting.

On June 1, 1994, the Company executed a management agreement with South
Atlantic Canners, Inc. ("SAC"), a manufacturing cooperative located in
Bishopville, South Carolina. The Company is a member of the cooperative and
receives a fee for managing the day-to-day operations of SAC pursuant to this
10-year management agreement. SAC has significantly expanded its operations by
adding two PET bottling lines. These new bottling lines will supply a portion of
the Company's and Piedmont's volume requirements for PET product.

RESULTS OF OPERATIONS

1995 COMPARED TO 1994

The Company reported net income of $10.5 million or $1.13 per share for
fiscal 1995 compared to $11.9 million or $1.28 per share for fiscal 1994. The
1995 results reflect an after tax extraordinary charge of $5.0 million or $.54
per share on the early retirement of some of the Company's Medium-Term Notes. A
one-time, after-tax noncash charge of $2.2 million or $.24 per share was
recorded in 1994 upon the adoption of Statement of Financial Accounting
Standards No. 112, "Employers' Accounting for Postemployment Benefits" ("SFAS
112").

Pretax earnings in 1995 were slightly higher than pretax earnings in 1994
despite increases in certain raw material costs and short-term interest rates.
Costs of goods sold related to net franchise sales increased due to higher
packaging costs; however, selling price increases more than offset the higher
cost of goods sold. The cost of aluminum cans increased significantly at the
beginning of 1995 as a result of increases in the price of aluminum ingot. The
Company entered into agreements in the fourth quarter of 1995 with its aluminum
can suppliers which require the Company to purchase the majority of its aluminum
can requirements for two of its four manufacturing facilities. These agreements,
which extend through the end of 2000, also reduce the variability of the cost of
cans for these two facilities. The cost of resin used to make plastic bottles
also increased significantly during 1995. The Company does not expect a similar
increase in the cost of plastic bottles in 1996.

12

Net franchise sales for 1995 increased 9%, reflecting a volume increase of
approximately 5% and higher average net selling prices. Sales to other bottlers
decreased by 13% during 1995 as compared to 1994 primarily due to South Atlantic
Canners providing a larger portion of Piedmont's finished products requirements.
Finished products are sold by the Company to Piedmont at cost. The Company's
share of Piedmont's net loss increased from $671,000 in 1994 to $2.1 million in
1995. The increased loss was due primarily to higher short-term interest rates
on Piedmont's variable rate debt.

Gross margin increased 6% in 1995. As a percentage of net franchise sales,
gross margin decreased slightly due to higher ingredient costs.

Selling expenses for 1995 increased at a slower rate than net sales.
Selling expenses decreased from 26.3% of net franchise sales in 1994 to 25.9% of
net franchise sales in 1995. Increased selling costs were due to the Company's
ongoing commitment to sales development programs which resulted in increased
market share in 1995. Employment costs rose over 1994 levels due to increases in
franchise volume and in certain sales and operational areas as the Company
strives to improve employee retention in key markets.

Depreciation expense increased 10.6% as a result of significant capital
spending in 1995 and 1994, primarily for manufacturing improvements related to
packaging changes and improvements to distribution facilities.

Interest expense increased by 5.4% in 1995 despite a reduction in long-term
debt of $13 million. This increase is attributable to an average borrowing cost
in 1995 of 7.3% versus 6.6% in 1994, due primarily to higher interest rates on
the Company's variable rate debt. The early retirement of approximately $87
million of Medium-Term Notes in the fourth quarter of 1995 is expected to reduce
interest expense in 1996 as a result of lower interest rates.

The $3.5 million change in "other income (expense), net" primarily reflects
a $1.2 million loss on disposal of assets in 1995 compared to a $1.4 million
gain on disposals in 1994. In addition, higher short-term interest rates
increased the cost of the Company's accounts receivable sale program by $.6
million.

The effective tax rate for federal and state income taxes was approximately
38.4% in 1995 versus approximately 42% in 1994. The difference between the
effective rate and the statutory rate was due primarily to amortization of
nondeductible goodwill, state income taxes, nondeductible premiums on officers'
life insurance and other nondeductible expenses. The 1995 rate was lower than
the 1994 rate due to the utilization of certain credits and the reduced impact
of nondeductible items.

1994 COMPARED TO 1993

The Company reported net income of $11.9 million or $1.28 per share for
fiscal 1994 compared to $14.8 million or $1.60 per share for fiscal 1993. A
one-time, after-tax noncash charge of $2.2 million or $.24 per share was
recorded in the first quarter of 1994 upon the adoption of Statement of
Financial Accounting Standards No. 112, "Employers' Accounting for
Postemployment Benefits" ("SFAS 112"). SFAS 112 requires the accrual, during the
years that employees render service, of the expected cost of providing
postemployment benefits if certain criteria are met.

Pretax earnings in 1994 were slightly higher than pretax earnings in 1993
despite higher short-term interest rates that increased interest expense by
approximately 10% in the second half of 1994 versus the second half of 1993.

Due to the formation of Piedmont on July 2, 1993, results of operations for
1994 are not directly comparable to the results of operations for 1993. On a
comparable franchise territory basis, net franchise sales for 1994 increased
5.2%, reflecting a volume increase of 4.6% and slightly higher average net
selling prices. The higher net selling prices maintained the increases in net
selling prices realized in 1993. Sales to other bottlers increased 57% during
1994 as compared to 1993 primarily due to the sale of soft drink products to
Piedmont. Finished products are sold to Piedmont at cost.

When adjusted for comparable territories, gross margin increased 4.8%. As a
percentage of net franchise sales, gross margin decreased slightly due to higher
ingredient costs.

For comparable franchise territories, selling expenses increased from
approximately 24.3% of net franchise sales in 1993 to approximately 26.3% of net
franchise sales in 1994. New sales development programs contributed to the
increase in selling expenses and resulted in improved market share. Higher
employment costs were incurred due to planned increases in certain sales and
operations functions to improve customer service and to reduce turnover.
Increased expenses associated with the cold drink effort resulted in a record
number of placements of vending equipment. For the comparable franchise
territories, general and administrative expenses as a percentage of net sales
increased slightly due to higher employment costs.

13

Amortization of goodwill and intangibles decreased 16.7% for fiscal 1994,
reflecting the 1993 sale and contribution of franchise territories to Piedmont.
Depreciation expense increased 3.9% as a result of increased capital spending,
primarily for manufacturing improvements related to packaging changes and other
line efficiency projects.

Interest expense increased 1.3% due to higher short-term interest rates.
The Company's overall weighted average borrowing rate on its long-term debt
increased from an average of 5.9% during 1993 to an average of 6.6% during 1994.

The change in "other income (expense), net" for 1994 was due primarily to a
third quarter 1994 gain on the sale of one of the Company's aircraft and a first
quarter 1994 gain on the sale of an idle production facility. This facility was
acquired in the 1991 Sunbelt acquisition and was closed in April 1992. Gains of
approximately $1.4 million on sales of property, plant and equipment were
included in "other income (expense), net" in 1994. Losses of approximately $1.1
million on sales of property, plant and equipment were included in "other income
(expense), net" in 1993.

The effective tax rate for federal and state income taxes was approximately
42% in 1994 versus approximately 38% in 1993. The difference between the
effective rate and the statutory rate was due primarily to amortization of
nondeductible goodwill, state income taxes, nondeductible premiums on officers'
life insurance and other nondeductible expenses. The 1993 rate was lower due to
the utilization of certain tax benefits from prior years. The formation of
Piedmont allowed the utilization of these benefits.

FINANCIAL CONDITION

Working capital increased by $4.0 million from a deficit of $14.3 million
on January 1, 1995 to a deficit of $10.3 million on December 31, 1995. The
working capital deficit is a result of the Company's sale of its trade accounts
receivable. The Company had sold trade accounts receivable of $35 million as of
December 31, 1995 and January 1, 1995. Proceeds from the sale of the Company's
trade accounts receivable were used to reduce its outstanding long-term debt.
The increase in working capital was primarily due to an increase in trade
accounts receivable and a decrease in accrued interest payable. Trade accounts
receivable increased principally due to increases in net sales. Accrued interest
declined due to the early retirement and refinancing of a portion of the
Company's long-term debt.

Other liabilities increased by $6.2 million primarily due to deferred
revenue received from certain franchisors under multi-year marketing programs
and liabilities accrued under certain deferred compensation programs.

In March 1995, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standard No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Of." This statement,
which is effective for fiscal years beginning after December 15, 1995, requires
that an entity evaluate long-lived assets and certain other identifiable
intangible assets for impairment whenever events or changes in circumstances
indicate that the carrying amount of the asset may not be recoverable. An
impairment loss meeting the recognition criteria is to be measured as the amount
by which the carrying amount for financial reporting purposes exceeds the fair
value of the asset. The Company plans to adopt this statement in 1996 and does
not expect adoption of the statement to have a material effect on the Company's
financial position or results of operations.

In October 1995, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standard No. 123, "Accounting for Stock-Based
Compensation," effective for fiscal years beginning after December 15, 1995.
This statement defines a fair value method of accounting for employee stock
options and encourages entities to adopt that method of accounting for its stock
compensation plans. Under the prescribed method, compensation cost would be
measured at the grant date based on the fair value of the award and would be
recognized over the related service period. An entity that does not adopt the
fair value method of accounting will be required to include in its financial
statements pro forma disclosures of net income and earnings per share as if the
fair value method of accounting had been applied. The Company plans to adopt
this statement in 1996 and does not expect adoption of the statement to have a
material effect on the Company's financial position or results of operations.

LIQUIDITY AND CAPITAL RESOURCES

On December 21, 1995, the Company amended and restated a revolving credit
agreement totaling $170 million and extended the maturity date to December 2000.
The agreement contains several covenants that establish ratio requirements
related to debt, interest expense and cash flow. A facility fee of 1/8% per year
on the banks' commitment is payable quarterly. There were no amounts outstanding
under this facility on December 31, 1995.

14

On November 20, 1995, the Company entered into a $170 million variable rate
loan agreement with $85 million maturing in November 2002 and $85 million
maturing in November 2003. This loan was used to repay two $60 million loans and
other debt. As of December 31, 1995, $170 million was outstanding under this
agreement.

On November 1, 1995, the Company issued $100 million of 6.85% debentures
due 2007 pursuant to a $400 million shelf registration filed in 1994 with the
Securities and Exchange Commission. The net proceeds from this issuance were
used to repurchase approximately $87 million of the Company's Medium-Term Notes
due between 1999 and 2002 and to repay other outstanding borrowings.

The Company borrows from time to time under informal lines of credit from
various banks. On December 31, 1995, the Company had $246 million available
under these lines, of which $22.6 million was outstanding. Loans under these
lines are made at the discretion of the banks at rates negotiated at the time of
borrowing.

A $100 million commercial paper program was established in January 1990 for
general corporate purposes. On December 31, 1995, there were no amounts
outstanding under this program.

It is the Company's intent to renew any borrowings under the revolving
credit facility and the lines of credit as they mature. To the extent that any
borrowings under the revolving credit facility, the informal lines of credit and
commercial paper program do not exceed the amount available under the Company's
$170 million revolving credit facility, they are classified as noncurrent
liabilities.

On June 26, 1992, the Company entered into a three-year arrangement under
which it has the right to sell an undivided interest in a designated pool of
trade accounts receivable for up to a maximum of $40 million. This arrangement
was amended in June 1995 to extend the arrangement to June 1998 on terms
substantially similar to those previously in place. On December 31, 1995, the
Company had sold $35 million of its trade accounts receivable and used the
proceeds to reduce its outstanding long-term debt.

On October 30, 1992, the Company entered into a three-year, $50 million
loan agreement. This agreement was amended November 30, 1992 to increase this
facility by $25 million to a total of $75 million. The proceeds from the loan
agreement were used primarily to redeem the Company's outstanding preferred
stock. On January 31, 1994, funds from informal lines of credit were used to
repay the $75 million loan agreement.

As of December 31, 1995, the Company was in compliance with the covenants
contained in its various borrowing agreements.

The Company uses interest rate hedging products to modify risk from
interest rate fluctuations in its underlying debt. The Company has historically
altered its fixed/floating rate mix based upon anticipated operating cash flows
of the Company relative to its debt level and the Company's ability to absorb
increases in interest rates. Sensitivity analyses are performed to review the
impact of various interest rate movements on the Company's financial position
and coverage ratios. The Company does not use derivative financial instruments
for trading purposes.

The weighted average interest rate of the debt portfolio as of December 31,
1995 is 7.2%. Approximately 48% of the Company's debt portfolio of $420 million
was subject to changes in short-term interest rates as of December 31, 1995.

Leasing is used to lower the Company's overall cost for certain capital
equipment additions. Total lease expense in 1995 was $23.3 million compared to
$20.9 million in 1994. The Company plans to lease the majority of its vending
and fleet requirements in 1996.

At the end of 1995, the Company had no material commitments for the
purchase of capital assets other than those related to normal replacement of
equipment.

Management believes that the Company, through the generation of cash flow
from operations and the utilization of unused borrowing capacity, has sufficient
financial resources available to maintain its current operations and provide for
its current capital expenditure requirements. The Company considers the
acquisition of additional franchise territories on an ongoing basis.

15

ITEM 8 -- FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

COCA-COLA BOTTLING CO. CONSOLIDATED

CONSOLIDATED BALANCE SHEETS

IN THOUSANDS (EXCEPT SHARE DATA)

DEC. 31, JAN. 1,
1995 1995

ASSETS
Current assets:
Cash............................................................................................ $ 2,434 $ 1,812
Accounts receivable, trade, less allowance for
doubtful accounts of $406 and $400............................................................ 12,098 7,756
Accounts receivable from The Coca-Cola Company.................................................. 6,725 4,514
Due from Piedmont Coca-Cola Bottling Partnership................................................ 4,584 1,383
Accounts receivable, other...................................................................... 9,492 7,232
Inventories..................................................................................... 27,989 31,871
Prepaid expenses and other current assets....................................................... 6,935 5,054
Total current assets 70,257 59,622
PROPERTY, PLANT AND EQUIPMENT, less accumulated depreciation of $153,602 and $141,419........... 191,800 185,633
INVESTMENT IN PIEDMONT COCA-COLA BOTTLING PARTNERSHIP........................................... 65,624 67,729
OTHER ASSETS.................................................................................... 33,268 23,394
IDENTIFIABLE INTANGIBLE ASSETS, less accumulated amortization of $85,535 and $75,667............ 247,983 257,851
EXCESS OF COST OVER FAIR VALUE OF NET ASSETS OF BUSINESSES ACQUIRED, less accumulated
amortization of $23,980 and $21,689........................................................... 67,639 69,930
Total......................................................................................... $676,571 $664,159

See Accompanying Notes to Consolidated Financial Statements.

16

DEC. 31, JAN. 1,
1995 1995

LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Portion of long-term debt payable within one year............................................... $ 120 $ 300
Accounts payable and accrued liabilities........................................................ 65,510 55,215
Accounts payable to The Coca-Cola Company....................................................... 3,636 2,930
Accrued compensation............................................................................ 5,049 4,246
Accrued interest payable........................................................................ 6,259 11,275
Total current liabilities..................................................................... 80,574 73,966
DEFERRED INCOME TAXES........................................................................... 97,252 89,531
OTHER LIABILITIES............................................................................... 39,877 33,710
LONG-TERM DEBT.................................................................................. 419,896 432,971
Total liabilities............................................................................. 637,599 630,178
SHAREHOLDERS' EQUITY:
Convertible Preferred Stock, $100 par value:
Authorized-50,000 shares; Issued-None
Nonconvertible Preferred Stock, $100 par value:
Authorized-50,000 shares; Issued-None
Preferred Stock, $.01 par value: Authorized-
20,000,000 shares; Issued-None
Common Stock, $1 par value: Authorized-
30,000,000 shares; Issued-10,090,859 shares................................................... 10,090 10,090
Class B Common Stock, $1 par value:
Authorized-10,000,000 shares; Issued-1,964,476 shares......................................... 1,965 1,965
Class C Common Stock, $1 par value:
Authorized-20,000,000 shares; Issued-None
Capital in excess of par value.................................................................. 120,733 130,028
Accumulated deficit............................................................................. (76,032) (86,552)
Minimum pension liability adjustment (138) (3,904)
56,618 51,627
Less-Treasury stock, at cost:
Common-2,132,800 shares....................................................................... 17,237 17,237
Class B Common-628,114 shares................................................................. 409 409
Total shareholders' equity.................................................................... 38,972 33,981
Total......................................................................................... $676,571 $664,159

See Accompanying Notes to Consolidated Financial Statements.

17

COCA-COLA BOTTLING CO. CONSOLIDATED

CONSOLIDATED STATEMENTS OF OPERATIONS

IN THOUSANDS (EXCEPT PER SHARE DATA)

FISCAL YEAR
1995 1994 1993

NET SALES (includes sales to Piedmont of $71,123, $85,272 and $42,183)................... $761,876 $723,896 $686,960
Cost of products sold, excluding depreciation shown below (includes $62,526, $75,879 and
$38,944 related to sales to Piedmont).................................................. 447,636 427,140 396,077
GROSS MARGIN............................................................................. 314,240 296,756 290,883
Selling expenses......................................................................... 158,831 149,992 144,411
General and administrative expenses...................................................... 54,720 54,559 51,125
Depreciation expense..................................................................... 26,746 24,188 23,284
Amortization of goodwill and intangibles................................................. 12,230 12,309 14,784
INCOME FROM OPERATIONS................................................................... 61,713 55,708 57,279
Interest expense......................................................................... 33,091 31,385 30,994
Other income (expense), net.............................................................. (3,401) 63 (2,270)
Income before income taxes, extraordinary charge and effect of accounting change......... 25,221 24,386 24,015
Federal and state income taxes:
Current................................................................................ 751 304 1,921
Deferred............................................................................... 8,934 9,935 7,261
Total federal and state income taxes..................................................... 9,685 10,239 9,182
Income before extraordinary charge and effect of accounting change....................... 15,536 14,147 14,833
Extraordinary charge, net of tax benefit of $3,127....................................... (5,016)
Effect of accounting change.............................................................. (2,211)
NET INCOME............................................................................... $ 10,520 $ 11,936 $ 14,833
Income per share:
Income before extraordinary charge and effect of accounting change..................... $ 1.67 $ 1.52 $ 1.60
Extraordinary charge................................................................... (.54)
Effect of accounting change............................................................ (.24)
NET INCOME............................................................................. $ 1.13 $ 1.28 $ 1.60
Cash dividends per share:
Common Stock........................................................................... $ 1.00 $ 1.00 $ .88
Class B Common Stock................................................................... 1.00 1.00 .52
Weighted average number of Common and Class B Common shares outstanding.................. 9,294 9,294 9,258

See Accompanying Notes to Consolidated Financial Statements.

18

COCA-COLA BOTTLING CO. CONSOLIDATED

CONSOLIDATED STATEMENTS OF CASH FLOWS

IN THOUSANDS

FISCAL YEAR
1995 1994 1993

CASH FLOWS FROM OPERATING ACTIVITIES
Net income............................................................................... $ 10,520 $ 11,936 $ 14,833
Adjustments to reconcile net income to net cash provided by operating activities:
Extraordinary charge................................................................ 5,016
Effect of accounting change......................................................... 2,211
Depreciation expense................................................................ 26,746 24,188 23,284
Amortization of goodwill and intangibles............................................ 12,230 12,309 14,784
Deferred income taxes............................................................... 8,934 9,935 7,261
(Gains) losses on sale of property, plant and equipment............................. 1,182 (1,361) 1,148
Amortization of debt costs.......................................................... 467 448 511
Undistributed loss of Piedmont Coca-Cola Bottling Partnership....................... 2,105 671 1,600
Increase in current assets less current liabilities................................. (3,174) (8,667) (403)
Increase in other noncurrent assets................................................. (9,588) (3,287) (4,414)
Increase in other noncurrent liabilities............................................ 10,891 7,779 1,191
Other............................................................................... 237 521 25
Total adjustments........................................................................ 55,046 44,747 44,987
Net cash provided by operating activities................................................ 65,566 56,683 59,820
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from the issuance of long-term debt............................................. 73,840
Payments on long-term debt............................................................... (1,387) (120,768)
Issuance of Common Stock................................................................. 2,269
Redemption of Medium-Term Notes.......................................................... (95,948)
Cash dividends paid...................................................................... (9,295) (9,294) (7,665)
Other.................................................................................... 791 (1,654) (1,376)
Net cash used in financing activities.................................................... (30,612) (12,335) (127,540)
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property, plant and equipment............................................... (37,284) (49,292) (28,786)
Proceeds from the sale of property, plant and equipment.................................. 2,952 5,494 1,908
Acquisitions of companies, net of cash acquired.......................................... (1,488)
Net proceeds from sale and contribution of assets to Piedmont Coca-Cola Bottling
Partnership............................................................................ 95,934
Net cash provided by (used in) investing activities...................................... (34,332) (43,798) 67,568
NET INCREASE (DECREASE) IN CASH.......................................................... 622 550 (152)
CASH AT BEGINNING OF YEAR................................................................ 1,812 1,262 1,414
CASH AT END OF YEAR...................................................................... $ 2,434 $ 1,812 $ 1,262

See Accompanying Notes to Consolidated Financial Statements.

19

COCA-COLA BOTTLING CO. CONSOLIDATED

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

IN THOUSANDS

CLASS MINIMUM
B CAPITAL IN PENSION
COMMON COMMON EXCESS OF ACCUMULATED LIABILITY TREASURY
STOCK STOCK PAR VALUE DEFICIT ADJUSTMENT STOCK

Balance on January 3, 1993............................ $ 9,977 $1,965 $ 144,831 $(113,321) $ 17,646
Net income............................................ 14,833
Cash dividends paid................................... (7,665)
Issuance of Common Stock.............................. 113 2,156
Minimum pension liability adjustment.................. $ (5,614)
Balance on January 2, 1994............................ 10,090 1,965 139,322 (98,488) (5,614) 17,646
Net income............................................ 11,936
Cash dividends paid................................... (9,294)
Minimum pension liability adjustment.................. 1,710
Balance on January 1, 1995............................ 10,090 1,965 130,028 (86,552) (3,904) 17,646
Net income............................................ 10,520
Cash dividends paid................................... (9,295)
Minimum pension liability adjustment.................. 3,766
BALANCE ON DECEMBER 31, 1995.......................... $10,090 $1,965 $ 120,733 $ (76,032) $ (138) $ 17,646

See Accompanying Notes to Consolidated Financial Statements.

20

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SIGNIFICANT ACCOUNTING POLICIES

Coca-Cola Bottling Co. Consolidated (the "Company") is engaged in the
production, marketing and distribution of carbonated and noncarbonated
beverages, primarily products of The Coca-Cola Company. The Company operates in
portions of 11 states, principally in the southeastern region of the United
States.

The consolidated financial statements include the accounts of the Company
and its majority owned subsidiaries. All significant intercompany accounts and
transactions have been eliminated.

The fiscal years presented are the 52-week periods ended December 31, 1995,
January 1, 1995 and January 2, 1994.

Certain prior year amounts have been reclassified to conform to current
year classifications.

The Company's more significant accounting policies are as follows:

CASH AND CASH EQUIVALENTS

Cash and cash equivalents include cash on hand, cash in banks and cash
equivalents, which are highly liquid debt instruments with maturities of less
than 90 days.

INVENTORIES

Inventories are stated at the lower of cost, primarily determined on the
last-in, first-out basis ("LIFO"), or market.

PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are recorded at cost and depreciated using
the straight-line method over the estimated useful lives of the assets.
Additions and major replacements or betterments are added to the assets at cost.
Maintenance and repair costs and minor replacements are charged to expense when
incurred. When assets are replaced or otherwise disposed of, the cost and
accumulated depreciation are removed from the accounts, and the gains or losses,
if any, are reflected in income.

INVESTMENT IN PIEDMONT COCA-COLA BOTTLING PARTNERSHIP

The Company beneficially owns a 50% interest in Piedmont Coca-Cola Bottling
Partnership ("Piedmont"). The Company accounts for its interest in Piedmont
using the equity method of accounting.

With respect to Piedmont, sales of soft drink products at cost, management
fee revenue and the Company's share of Piedmont's results from operations are
included in "Net sales." See Note 2 for additional information.

INCOME TAXES

The Company provides deferred income taxes for the tax effects of temporary
differences between the financial reporting and income tax bases of the
Company's assets and liabilities.

BENEFIT PLANS

The Company has a noncontributory pension plan covering substantially all
nonunion employees and one noncontributory pension plan covering certain union
employees. Costs of the plans are charged to current operations and consist of
several components of net periodic pension cost based on various actuarial
assumptions regarding future experience of the plans. In addition, certain other
union employees are covered by plans provided by their respective union
organizations. The Company expenses amounts as paid in accordance with union
agreements. The Company recognizes the cost of postretirement benefits, which
consist principally of medical benefits, during employees' periods of active
service.

Amounts recorded for benefit plans reflect estimates related to future
interest rates, investment returns, employee turnover, wage increases and health
care costs. The Company reviews all assumptions and estimates on an ongoing
basis.

21

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

INTANGIBLE ASSETS AND EXCESS OF COST OVER FAIR VALUE OF NET ASSETS OF BUSINESSES
ACQUIRED

Identifiable intangible assets resulting from the acquisition of Coca-Cola
bottling franchises are being amortized on a straight-line basis over periods
ranging from 17 to 40 years. The excess of cost over fair value of net assets of
businesses acquired is being amortized on a straight-line basis over 40 years.

The Company continually monitors conditions that may affect the carrying
value of its intangible assets. When conditions indicate potential impairment of
an intangible asset, the Company will undertake necessary market studies and
reevaluate projected future cash flows associated with the intangible asset.
When projected future cash flows, not discounted for the time value of money,
are less than the carrying value of the intangible asset, the impaired asset is
written down to its net realizable value.

PER SHARE AMOUNTS

Per share amounts are calculated based on the weighted average number of
Common and Class B Common shares outstanding.

POSTEMPLOYMENT BENEFITS

In November 1992, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 112, "Employers' Accounting for
Postemployment Benefits" ("SFAS 112"). SFAS 112 requires the accrual, during the
years that employees render service, of the expected cost of providing
postemployment benefits if certain criteria are met. Postemployment benefits
encompass various types of employer-provided benefits including, but not limited
to, workers' compensation, disability-related benefits and severance benefits.

The Company adopted the provisions of SFAS 112 in the first quarter of
1994, effective January 3, 1994.

DERIVATIVE FINANCIAL INSTRUMENTS

Premiums paid for interest rate cap agreements are amortized to interest
expense over the terms of the agreements. Unamortized premiums are included in
other liabilities. Amounts receivable under cap agreements are accrued as a
reduction of interest expense.

Unamortized deferred gains or losses on interest rate swap terminations are
amortized over the lives of the initial agreements as an adjustment to interest
expense. Amounts receivable or payable under interest rate swap agreements are
included in other assets or other liabilities.

Forward rate agreements are used to fix the interest rate reset periods on
a portion of debt that is floating. The differential to be paid or received
under these agreements is accrued as interest rates change and is recognized as
an adjustment to interest expense over the terms of the agreements. Amounts
receivable or payable under forward rate agreements are included in other assets
or other liabilities.

2. INVESTMENT IN PIEDMONT COCA-COLA BOTTLING PARTNERSHIP

On July 2, 1993, the Company and The Coca-Cola Company formed Piedmont
Coca-Cola Bottling Partnership ("Piedmont") to distribute and market soft drink
products primarily in certain portions of North Carolina and South Carolina. The
Company and The Coca-Cola Company, through their respective subsidiaries, each
beneficially own a 50% interest in Piedmont. The Company provides a portion of
the soft drink products for Piedmont at cost and receives a fee for managing the
operations of Piedmont pursuant to a management agreement.

Subsidiaries of the Company made an initial capital contribution to
Piedmont of $70 million in the aggregate. The capital contribution made by such
subsidiaries was composed of approximately $21.7 million in cash and of bottling
operations and certain assets used in connection with the Company's Wilson,
North Carolina and Greenville and Beaufort, South Carolina territories. The cash
contributed to Piedmont by the Company's subsidiaries was provided from the
Company's available credit facilities. The Company sold other territories to
Piedmont for an aggregate purchase price of approximately $118 million. Assets
were sold or contributed at their approximate carrying values. Proceeds from the
sale of territories to

22

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Piedmont, net of the Company's cash contribution, totaled approximately $96
million and were used to reduce the Company's long-term debt.

Summarized financial information for Piedmont is as follows:

DEC. 31, JAN. 1,
IN THOUSANDS 1995 1995

Current assets........................................................................................ $ 22,136 $ 18,907
Noncurrent assets..................................................................................... 351,450 358,371
Total assets.......................................................................................... $373,586 $377,278
Current liabilities................................................................................... $ 13,775 $ 7,035
Noncurrent liabilities................................................................................ 228,563 234,785
Total liabilities..................................................................................... 242,338 241,820
Partners' equity...................................................................................... 131,248 135,458
Total liabilities and partners' equity $373,586 $377,278
Company's equity investment........................................................................... $ 65,624 $ 67,729

FISCAL FISCAL FOR THE PERIOD
YEAR YEAR JULY 2, 1993 THROUGH
IN THOUSANDS 1995 1994 JANUARY 2, 1994

Net sales........................................................................ $212,665 $194,054 $ 91,259
Cost of products sold............................................................ 126,197 109,563 52,535
Gross margin..................................................................... 86,468 84,491 38,724
Income from operations........................................................... 5,618 6,705 1,209
Net loss......................................................................... $ (4,210) $ (1,342) $ (3,200)
Company's equity in loss......................................................... $ (2,105) $ (671) $ (1,600)

3. INVENTORIES

Inventories are summarized as follows:

DEC.
31, JAN. 1,
IN THOUSANDS 1995 1995

Finished products....................................................................................... $17,809 $17,621
Manufacturing materials................................................................................. 8,809 12,638
Used bottles and cases.................................................................................. 1,371 1,612
Total inventories....................................................................................... $27,989 $31,871

The amounts included above for inventories valued by the LIFO method were
greater than replacement or current cost by approximately $1.2 million and $2.1
million on December 31, 1995 and January 1, 1995, respectively, as a result of
inventory premiums associated with certain acquisitions.

23

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

4. PROPERTY, PLANT AND EQUIPMENT

The principal categories and estimated useful lives of property, plant and
equipment were as follows:

DEC. 31, JAN. 1, ESTIMATED
IN THOUSANDS 1995 1995 USEFUL LIVES

Land.................................................................... $ 9,500 $ 9,898
Buildings............................................................... 71,359 65,973 10-50 years
Machinery and equipment................................................. 80,909 76,296 5-20 years
Transportation equipment................................................ 48,267 42,439 4-10 years
Furniture and fixtures.................................................. 23,027 21,180 7-10 years
Vending equipment....................................................... 88,903 88,666 6-13 years
Leasehold and land improvements......................................... 20,048 18,049 5-20 years
Construction in progress................................................ 3,389 4,551
Total property, plant and equipment, at cost............................ 345,402 327,052
Less: Accumulated depreciation.......................................... 153,602 141,419
Property, plant and equipment, net...................................... $191,800 $185,633

5. IDENTIFIABLE INTANGIBLE ASSETS

The principal categories and estimated useful lives of identifiable
intangible assets, net of accumulated amortization, were as follows:

DEC. 31, JAN. 1, ESTIMATED
IN THOUSANDS 1995 1995 USEFUL LIVES

Franchise rights........................................................ $217,149 $223,679 40 years
Customer lists.......................................................... 25,400 28,129 17-23 years
Advertising savings..................................................... 4,764 5,278 17-23 years
Other................................................................... 670 765 17-18 years
Total identifiable intangible assets.................................... $247,983 $257,851

24

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

6. LONG-TERM DEBT

Long-term debt is summarized as follows:

FIXED(F) OR
INTEREST VARIABLE(V) INTEREST DEC. 31, JAN. 1,
IN THOUSANDS MATURITY RATE RATE PAID 1995 1995

Lines of Credit................................ 2000 6.00%- V Varies $ 22,590 $ 93,420
6.04%
Term Loan Agreement............................ 2002 6.44%- V Varies 85,000 60,000
6.46%
Term Loan Agreement............................ 2003 6.44%- V Varies 85,000 60,000
6.46%
Medium-Term Notes.............................. 1998 6.37% V Quarterly 10,000 10,000

Medium-Term Notes.............................. 1998 10.05% F Semi- 2,000 2,000
annually
Medium-Term Notes.............................. 1999 7.99% F Semi- 28,585 66,500
annually
Medium-Term Notes.............................. 2000 10.00% F Semi- 25,500 55,000
annually
Medium-Term Notes.............................. 2002 8.56% F Semi- 47,000 66,500
annually
Debentures..................................... 2007 6.85% F Semi- 100,000
annually
Notes acquired in Sunbelt acquisition.......... 2001 8.00% F Quarterly 217 5,327

Other notes payable............................ 1996- 6.85%- F Varies 14,124 14,524
2001 12.00%
420,016 433,271
Less: Portion of long-term debt payable within one year............................................... 120 300
Long-term debt........................................................................................ $419,896 $432,971

The principal maturities of long-term debt outstanding on December 31, 1995
were as follows:

IN THOUSANDS

1997.............................................................................................................. $ 125
1998.............................................................................................................. 12,050
1999.............................................................................................................. 28,635
2000.............................................................................................................. 50,762
Thereafter........................................................................................................ 328,324
Total long-term debt.............................................................................................. $419,896

On December 21, 1995, the Company amended and restated the revolving credit
agreement totaling $170 million and extended the revolving credit maturity date
to December 2000. The agreement contains several covenants which establish ratio
requirements related to debt, interest expense and cash flow. A facility fee of
1/8% per year on the banks' commitment is payable quarterly. There were no
amounts outstanding under this facility as of December 31, 1995.

A $100 million commercial paper program was established in January 1990 for
general corporate purposes. On December 31, 1995, there were no amounts
outstanding under this program.

The Company borrows from time to time under informal lines of credit from
various banks. On December 31, 1995, the Company had $246 million of credit
available under these lines, of which $22.6 million was outstanding. Loans under
these lines are made at the sole discretion of the banks at rates negotiated at
the time of borrowing. It is the Company's intent to

25

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

renew such borrowings as they mature. To the extent that these borrowings, the
borrowings under the revolving credit facility described above, and outstanding
commercial paper do not exceed the amount available under the Company's $170
million revolving credit facility, they are classified as noncurrent
liabilities.

On November 20, 1995, the Company entered into a $170 million loan
agreement with $85 million maturing in November 2002 and $85 million maturing in
November 2003. This loan was used to repay two $60 million loans previously
entered into by the Company and other bank debt.

On June 26, 1992, the Company entered into a three-year arrangement under
which it has the right to sell an undivided interest in a designated pool of
trade accounts receivable for up to a maximum of $40 million. As of December 31,
1995 and January 1, 1995, the Company had sold $35 million of its trade accounts
receivable and used the proceeds to reduce its outstanding long-term debt. This
arrangement was amended in June 1995 to extend the arrangement to June 1998 on
terms substantially similar to those previously in place. The discount on sales
of trade accounts receivable was $2.2 million, $1.6 million, $1.4 million in
1995, 1994 and 1993, respectively, and is included in "other income (expense),
net."

On October 12, 1994, a $400 million shelf registration for debt and equity
securities filed with the Securities and Exchange Commission became effective
and the securities thereunder became available for issuance. On November 1,
1995, the Company issued $100 million of 6.85% debentures due 2007 pursuant to
such registration. The net proceeds from this issuance were used principally for
refinancing existing indebtedness with the remainder used to repay other bank
debt. As of December 31, 1995, $37.9 million of Medium-Term Notes due 1999 with
a coupon rate of 7.99%, $29.5 million of Medium-Term Notes due 2000 with a
coupon rate of 10.00% and $19.5 million of Medium-Term Notes due 2002 with a
coupon rate of 8.56% had been repurchased. An after tax extraordinary charge of
$5.0 million related to the premium paid on these repurchases was recorded in
the fourth quarter of 1995.

As of December 31, 1995, the Company was in compliance with the covenants
covering all of its various borrowing agreements.

The Company has a weighted average interest rate of 7.2% for the debt
portfolio as of December 31, 1995 compared to 7.0% at January 1, 1995. The
Company's overall weighted average borrowing rate on its long-term debt
increased from an average of 6.6% during 1994 to an average of 7.3% during 1995.

As of December 31, 1995, after taking into account all of the interest rate
hedging activities, approximately $203 million or 48% of the total debt
portfolio was subject to changes in short-term interest rates.

A rate increase of 1% would increase annual interest expense by
approximately $2.0 million and net income for the year ended December 31, 1995
would have been reduced by approximately $1.2 million. Interest coverage as of
December 31, 1995 would have been 2.0 times (versus 2.1 times) if interest rates
increased by 1%.

7. DERIVATIVE FINANCIAL INSTRUMENTS

The Company uses interest rate hedging products to modify risk from
interest rate fluctuations in its underlying debt. The Company has historically
altered its fixed/floating rate mix based upon anticipated operating cash flows
of the Company relative to its debt level and the Company's ability to absorb
increases in interest rates. During 1995, and in conjunction with the Company's
early retirement of a portion of its Medium-Term Notes, all but two of the
derivative financial instruments held by the Company were extinguished.

All deferred gains and losses on interest rate hedging transactions
associated with the retired Medium-Term Notes have been recognized in 1995. The
notional amount of the extinguished interest rate swaps exceeds the amount of
debt retired due to the Company's practice of offsetting swaps. Offsetting swaps
rather than an original swap were used to help mitigate counterparty credit risk
as well as reduce administrative burden. The offsetting swaps along with
original swaps and the underlying debt were accounted for as a combined
instrument. The Company does not use derivative financial instruments for
trading or other speculative purposes nor does it use leveraged financial
instruments. All of the Company's outstanding interest rate swap agreements are
LIBOR-based. The Company's two remaining interest rate swaps are with the same
financial institution and effectively offset each other. Accordingly, risk of
counterparty nonperformance is considered minimal.

26

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Derivative financial instruments are summarized as follows:

December 31, 1995 January 1, 1995
Remaining Remaining
IN THOUSANDS Amount Term Amount Term

Interest rate swaps -- floating............................................ $60,000 8 years $221,600 6-9 years
Interest rate swaps -- fixed............................................... 60,000 8 years 215,000 1-9 years
Interest rate caps......................................................... -0- -- 110,000 .5 years

INTEREST RATE SWAP ACTIVITY

The table below summarizes interest rate swap activity for the period
ending December 31, 1995:

IN THOUSANDS

Total swaps, January 1, 1995..................................................................................... $ 436,600
New swaps........................................................................................................ 25,000
Terminated swaps................................................................................................. (341,600)
Expired swaps.................................................................................................... -0-
Total swaps, December 31, 1995................................................................................... $ 120,000

8. FAIR VALUES OF FINANCIAL INSTRUMENTS

The following methods and assumptions were used by the Company in
estimating the fair values of its financial instruments:

PUBLIC DEBT

The fair values of the Company's public debt are based on estimated market
prices.

NON-PUBLIC VARIABLE RATE LONG-TERM DEBT

The carrying amounts of the Company's variable rate borrowings approximate
their fair values.

NON-PUBLIC FIXED RATE LONG-TERM DEBT

The fair values of the Company's fixed rate long-term borrowings are
estimated using discounted cash flow analyses based on the Company's current
incremental borrowing rates for similar types of borrowing arrangements.

DERIVATIVE FINANCIAL INSTRUMENTS

Fair values for the Company's interest rate swaps are based on current
settlement values.

The carrying amounts and fair values of the Company's balance sheet and
off-balance-sheet instruments were as follows:

December 31, 1995 January 1, 1995
IN THOUSANDS Carrying Amount Fair Value Carrying Amount Fair Value

Balance Sheet Instruments
Public debt...................................................... $ 213,085 $ 228,103 $ 200,000 $ 201,119
Non-public variable rate long-term debt.......................... 192,590 192,590 213,420 213,420
Non-public fixed rate long-term debt............................. 14,341 16,189 19,851 19,030
Off-Balance-Sheet Instruments
Interest rate swaps.............................................. (4,725) (11,123)

The fair values of the interest rate swaps represent the estimated amounts
the Company would have had to pay to terminate these agreements.

27

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

9. COMMITMENTS AND GUARANTEES

Operating lease payments are charged to expense as incurred. Such rental
expenses included in the consolidated statements of operations were $23.3
million, $20.9 million and $17.3 million for 1995, 1994 and 1993, respectively.

The following is a summary of future minimum lease payments for all
operating leases as of December 31, 1995:

IN THOUSANDS

1996.............................................................................................................. $ 23,255
1997.............................................................................................................. 20,759
1998.............................................................................................................. 18,940
1999.............................................................................................................. 14,588
2000.............................................................................................................. 11,445
Thereafter........................................................................................................ 29,651
Total minimum lease payments...................................................................................... $118,638

The Company is a member of one cooperative from which it is obligated to
purchase a specified minimum number of plastic bottles on an annual basis
through December 1998. The annual purchase commitment under this agreement is
approximately $.5 million. The Company is a member of another cooperative from
which it is obligated to purchase a specified number of cases of finished
product on an annual basis. The current annual purchase commitment under this
agreement is approximately $40 million.

The Company guarantees a portion of the debt for one cooperative from which
the Company purchases plastic bottles. The Company also guarantees a portion of
debt for South Atlantic Canners, Inc., a manufacturing cooperative that is being
managed by the Company. See Note 13 to the consolidated financial statements for
additional information concerning these financial guarantees. The total amounts
guaranteed on December 31, 1995 and January 1, 1995 were $35.2 million and $31.0
million, respectively.

The Company has entered into purchase agreements for aluminum cans on an
annual basis through 2000. The annual purchase commitment under these agreements
is approximately $39 million.

10. INCOME TAXES

The provision for income taxes on income before extraordinary charge and
the effect of an accounting change consisted of the following:

FISCAL YEAR
IN THOUSANDS 1995 1994 1993

Current:
Federal................................................................................... $ 751 $ 304 $ 1,921
State.....................................................................................
751 304 1,921
Deferred:
Federal................................................................................... 9,382 8,957 (27,748)
State..................................................................................... 2,130 1,213 (3,662)
Benefit of acquired loss carryforwards used to reduce franchise value..................... 35,599
Benefit (expense) of minimum pension liability adjustment................................. (2,578) (359) 3,072
Other..................................................................................... 124
8,934 9,935 7,261
Income tax expense.......................................................................... $ 9,685 $10,239 $ 9,182

Income tax benefits of $1.7 million were recorded in 1994 in conjunction
with the adoption of SFAS 112. Income tax benefits of $3.1 million were recorded
in 1995 related to the extraordinary charge associated with the early retirement
of long-term debt at a premium.

28

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company made income tax payments for alternative minimum tax of
approximately $1.1 million and $.3 million during 1995 and 1994, respectively.

Deferred income taxes are recorded based upon differences between the
financial statement and tax bases of assets and liabilities and available tax
credit carryforwards. Temporary differences and carryforwards that comprised a
significant part of deferred income tax assets and liabilities were as follows:

DEC. 31, JAN. 1,
IN THOUSANDS 1995 1995

Intangible assets..................................................................................... $106,752 $107,886
Depreciation.......................................................................................... 23,166 22,249
Investment in Piedmont................................................................................ 19,417 18,715
Other................................................................................................. 10,309 16,920
Gross deferred income tax liabilities................................................................. 159,644 165,770

Net operating loss carryforwards...................................................................... (39,736) (56,497)
Other................................................................................................. (25,817) (18,278)
Gross deferred income tax assets...................................................................... (65,553) (74,775)
Tax benefit of minimum pension liability adjustment................................................... (48) (2,713)
Deferred income tax liability......................................................................... $ 94,043 $ 88,282

Net current deferred tax assets of $3.2 million and $1.2 million were
included in prepaid expenses and other current assets on December 31, 1995 and
January 1, 1995, respectively.

Reported income tax expense is reconciled to the amount computed on the
basis of income before income taxes, extraordinary charge and effect of
accounting change at the statutory rate as follows:

FISCAL YEAR
IN THOUSANDS 1995 1994 1993

Statutory expense.............................................................................. $8,827 $ 8,535 $ 8,405
Amortization of franchise and goodwill assets.................................................. 364 364 364
State income taxes, net of federal benefit..................................................... 758 1,244 1,185
Effect of change in statutory tax rates........................................................ 2,100
Adjustment of valuation allowance.............................................................. (3,216)
Other.......................................................................................... (264) 96 344
Income tax expense............................................................................. $9,685 $10,239 $ 9,182

The Company had $3.5 million of investment tax credits available to reduce
future income tax payments for federal income tax purposes on December 31, 1995.
These credits expire in varying amounts through 2001.

On December 31, 1995, the Company had $97 million and $132 million of
federal and state net operating losses, respectively, available to reduce future
income taxes. The net operating loss carryforwards expire in varying amounts
through 2007.

The Omnibus Budget Reconciliation Act of 1993 increased the maximum federal
income tax rate from 34% to 35% effective January 1, 1993. This increase
resulted in additional income tax expense of $2.1 million for the year ended
January 2, 1994.

11. CAPITAL TRANSACTIONS

On April 9, 1993, the Company acquired all of the outstanding stock of
Whirl-i-Bird, Inc. in exchange for 80,000 shares of the Company's Common Stock
valued at $1.6 million (based on the closing market price of $20 per share on
March 17, 1993). Whirl-i-Bird, Inc. had previously leased a helicopter to the
Company from time to time and was wholly owned by J. Frank Harrison, Jr., the
Chairman of the Board of Directors of the Company. On June 25, 1993, the Company
issued

29

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

33,464 shares of its Common Stock to The Coca-Cola Company at a price of $20 per
share. These shares were issued pursuant to a Stock Rights and Restrictions
Agreement dated January 27, 1989 that provided The Coca-Cola Company a
preemptive right to purchase a number of shares of the Company's equity
securities as necessary to allow it to maintain ownership of both 29.67% of the
outstanding shares of common stock of all classes and 22.59% of the total votes
of all outstanding shares of all classes. This preemptive right was triggered by
the issuance of shares pursuant to the Whirl-i-Bird transaction.

Shareholders with Class B Common Stock are entitled to 20 votes per share
compared to one vote per share on the Common Stock. Dividends on the Class B
Common Stock are permitted to equal, but not exceed, dividends on the Common
Stock. On February 8, 1994, the Board of Directors increased the dividend for
the first quarter of 1994 to $.25 per share on both the Common and Class B
Common shares outstanding. This dividend rate was maintained throughout 1994 and
1995.

On March 8, 1989, the Company granted J. Frank Harrison, Jr. an option for
the purchase of 100,000 shares of Common Stock exercisable at the closing market
price of the stock on the day of grant. The closing market price of the stock on
March 8, 1989 was $27.00 per share. The option is exercisable, in whole or in
part, at any time at the election of Mr. Harrison, Jr. over a period of 15 years
from the date of grant. This option has not been exercised with respect to any
such shares.

On August 9, 1989, the Company granted J. Frank Harrison, III an option for
the purchase of 150,000 shares of Common Stock exercisable at the closing market
price of the stock on the day of grant. The closing market price of the stock on
August 9, 1989 was $29.75 per share. The option may be exercised, in whole or in
part, during a period of 15 years beginning on the date of grant. The option is
currently exercisable with respect to 127,500 shares and is exercisable with
respect to an additional 7,500 shares annually. This option has not been
exercised with respect to any such shares.

12. BENEFIT PLANS

Pension plan expense related to the two Company-sponsored pension plans for
1995, 1994 and 1993 was $2.7 million, $2.6 million and $2.5 million,
respectively, including the pro rata share of past service costs, which are
being amortized over 30 years. In addition, certain employees are covered by
pension plans administered by unions.

Retirement benefits under the Company's principal pension plan are based on
the employee's length of service, average compensation over the five consecutive
years which gives the highest average compensation and the average of the Social
Security taxable wage base during the 35-year period before a participant
reaches Social Security retirement age. Contributions to the plan are based on
the projected unit credit actuarial funding method and are limited to the
amounts that are currently deductible for tax purposes.

The following table sets forth the status of the two Company-sponsored
plans:

DEC. 31, JAN. 1,
IN THOUSANDS 1995 1995

Actuarial present value of benefit obligations:
Accumulated benefit obligation, including vested benefits of $48,990 and $40,779..................... $ 50,236 $ 42,282
Projected benefit obligation for service rendered to date.............................................. (56,427) (47,355)
Plan assets at fair market value....................................................................... 51,988 41,107
Projected benefit obligation in excess of plan assets.................................................. (4,439) (6,248)
Unrecognized net loss.................................................................................. 11,752 12,158
Unrecognized prior service cost........................................................................ (1,207) 12
Unrecognized net asset being amortized over 7 years.................................................... (210) (280)
Additional minimum pension liability................................................................... (225) (6,816)
Pension asset (liability).............................................................................. $ 5,671 $ (1,174)

Under the requirements of Statement of Financial Accounting Standards No.
87, "Employers' Accounting for Pensions," an additional minimum pension
liability for certain plans, representing the excess of accumulated benefits
over plan assets,

30

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

was recognized as of January 2, 1994. The increase in liabilities was charged
directly to shareholders' equity. As of December 31, 1995 and January 1, 1995,
the minimum pension liability adjustment, net of income taxes, was $138,000 and
$3.9 million, respectively.

Net periodic pension cost for the Company-sponsored pension plans included
the following:

FISCAL YEAR
IN THOUSANDS 1995 1994 1993

Service cost-benefits earned.................................................................. $ 1,901 $ 1,916 $ 1,693
Interest cost on projected benefit obligation................................................. 4,015 3,556 3,310
Actual return on plan assets.................................................................. (6,993) 1,169 (3,965)
Net amortization and deferral................................................................. 3,732 (4,034) 1,446
Net periodic pension cost..................................................................... $ 2,655 $ 2,607 $ 2,484

The actuarial assumptions that were used for the Company's principal
pension plan calculations were as follows:

1995 1994

Weighted average discount rate used in determining the actuarial present value of the projected benefit
obligation............................................................................................... 7.75% 8.25%
Weighted average expected long-term rate of return on plan assets.......................................... 9.0% 9.0%
Weighted average rate of compensation increase............................................................. 4.50% 4.75%

The Company provides a 401(k) Savings Plan for substantially all of its
nonunion employees. Under provisions of the Savings Plan, an employee is vested
with respect to Company contributions upon the earlier of two consecutive years
of service while participating in the Savings Plan or after five years of
service with the Company. The total cost for this benefit in 1995, 1994 and 1993
was $1.6 million, $1.3 million and $1.5 million, respectively.

The Company recognizes the cost of postretirement benefits, which consist
principally of medical benefits, during employees' periods of active service.
The Company does not pre-fund these benefits and has the right to modify or
terminate certain of these plans in the future.

The components of postretirement benefit expense were as follows:

FISCAL YEAR
IN THOUSANDS 1995 1994 1993

Service cost -- benefits earned.................................................................. $ 338 $ 304 $ 238
Interest cost on projected benefit obligation.................................................... 1,275 989 1,223
Net amortization................................................................................. 11
Net postretirement benefit cost.................................................................. $1,624 $1,293 $1,461

The accrued postretirement benefit obligation was comprised of the
following:

DEC. 31, JAN. 1,
IN THOUSANDS 1995 1995

Accumulated postretirement benefit obligation:
Retirees.............................................................................................. $10,025 $ 9,163
Fully eligible active plan participants............................................................... 2,231 1,738
Other active plan participants........................................................................ 4,124 3,251
16,380 14,152
Unrecognized transition asset........................................................................... 394 418
Unrecognized net loss................................................................................... (2,443) (1,622)
Accrued postretirement benefit obligation............................................................... $14,331 $12,948

31

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The weighted average health care cost trend rate used in measuring the
postretirement benefit expense was 9% in 1995 gradually declining to 5.25% in
1999 and remaining at that level thereafter. A 1% increase in this annual trend
rate would have increased the accumulated postretirement benefit obligation on
December 31, 1995 by approximately $1.7 million and postretirement benefit
expense in 1995 would have increased by approximately $227,000. The weighted
average discount rates used to estimate the accumulated postretirement benefit
obligation were 7.75% and 8.25% as of December 31, 1995 and January 1, 1995,
respectively.

In November 1992, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 112, "Employers' Accounting for
Postemployment Benefits" ("SFAS 112"). SFAS 112 requires the accrual, during the
years that employees render service, of the expected cost of providing
postemployment benefits if certain criteria are met. The Company adopted the
provisions of SFAS 112 in the first quarter of 1994, effective January 3, 1994,
and recorded a one-time, after tax charge of $2.2 million. The annual
incremental cost of adoption of SFAS No. 112 is not material on an ongoing
basis.

13. RELATED PARTY TRANSACTIONS

The Company's business consists primarily of the production, marketing and
distribution of soft drink products of The Coca-Cola Company, which is the sole
owner of the secret formulas under which the primary components (either
concentrates or syrups) of its soft drink products are manufactured.
Accordingly, the Company purchases a substantial majority of its requirements
for concentrates and syrups from The Coca-Cola Company in the ordinary course of
its business. The Company paid The Coca-Cola Company approximately $186 million,
$187 million and $158 million in 1995, 1994 and 1993, respectively, for
sweetener, syrup, concentrate and other miscellaneous purchases. Additionally,
the Company engages in a variety of marketing programs, local media advertising
and similar arrangements to promote the sale of products of The Coca-Cola
Company in territories operated by the Company. Total direct marketing support
provided to the Company by The Coca-Cola Company was approximately $36 million,
$32 million and $28 million in 1995, 1994 and 1993, respectively. In addition,
the Company paid approximately $18 million, $15 million and $13 million in 1995,
1994 and 1993, respectively, for local media and marketing program expense
pursuant to cooperative advertising and cooperative marketing arrangements with
The Coca-Cola Company.

On July 2, 1993, the Company and The Coca-Cola Company formed Piedmont. The
Company and The Coca-Cola Company, through their respective subsidiaries, each
beneficially own a 50% interest in Piedmont. The Company provides a portion of
the soft drink products for Piedmont at cost and receives a fee for managing the
operations of Piedmont pursuant to a management agreement. The Company sold
product to Piedmont during 1995, 1994 and the six months ended January 2, 1994,
at cost, totaling $62.5 million, $75.9 million and $38.9 million, respectively.
The Company received $10.7 million, $10.1 million and $4.8 million for
management services pursuant to its management agreement with Piedmont for 1995,
1994 and 1993, respectively. Also, the Company subleased various fleet and
vending equipment to Piedmont at cost. These sublease rentals amounted to
approximately $784,000, $693,000 and $380,000 in 1995, 1994 and 1993,
respectively. In addition, Piedmont subleased various fleet and vending
equipment to the Company at cost. These sublease rentals amounted to
approximately $186,000, $56,000 and $2,000 in 1995, 1994 and 1993, respectively.

On November 30, 1992, the Company and the owner of the Company's Snyder
Production Center in Charlotte, North Carolina agreed to the early termination
of the Company's lease. Harrison Limited Partnership One purchased the property
contemporaneously with the termination of the lease, and the Company and
Harrison Limited Partnership One entered into an agreement pursuant to which the
Company leased the property for a 10-year term beginning on December 1, 1992. A
North Carolina corporation owned entirely by J. Frank Harrison, Jr. serves as
sole general partner of the limited partnership. The sole limited partner of
this limited partnership is a trust as to which J. Frank Harrison, III and Reid
M. Henson are co-trustees. The annual base rent the Company is obligated to pay
for its lease of the Snyder Production Center is subject to adjustment for
increases in the Consumer Price Index and for increases or decreases in interest
rates, using LIBOR as the measurement device. Rent expense under this lease
totaled $2,593,000, $2,007,000 and $1,947,000 in 1995, 1994 and 1993,
respectively.

On June 1, 1993, the Company entered into a 10-year lease agreement with
Beacon Investment Corporation related to the Company's headquarters office
building. Beacon Investment Corporation's sole shareholder is J. Frank Harrison,
III. The annual base rent the Company is obligated to pay under this lease is
subject to adjustment for increases in the Consumer Price

32

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Index and for increases or decreases in interest rates, using LIBOR as the
measurement device. Rent expense under this lease totaled $1,804,000, $1,560,000
and $738,000 in 1995, 1994 and 1993, respectively.

The Company is a shareholder in two entities from which it purchases
substantially all its requirements for plastic bottles. Net purchases from these
entities were approximately $52 million, $44 million and $47 million in 1995,
1994 and 1993, respectively. In connection with its participation in one of
these cooperatives, the Company has guaranteed a portion of the cooperative's
debt. On December 31, 1995, such guarantee amounted to approximately $20
million.

The Company has also guaranteed a portion of debt for South Atlantic
Canners, Inc., a manufacturing cooperative that is being managed by the Company.
On December 31, 1995, such guarantee was approximately $15.2 million.

The Company leases vending equipment from Coca-Cola Financial Corporation
("CCFC"), a subsidiary of The Coca-Cola Company. Future lease payments to CCFC
as of December 31, 1995 totaled $49.6 million. During 1995, the Company made
lease payments to CCFC totaling $4.4 million.

See Note 11 to the consolidated financial statements for information
concerning the Whirl-i-Bird transaction.

14. LITIGATION

On March 4, 1993, a Complaint was filed against the Company, the
predecessor bottling company for the Laurel, Mississippi territory and other
unnamed parties by the testatrix spouse of a deceased former employee of the
predecessor bottler. This suit alleges misrepresentation and fraud in connection
with the severance package offered to employees terminated by the predecessor
bottler in connection with the acquisition of the Laurel franchise subsidiary of
the Company. Plaintiff seeks damages in an amount up to $18 million in
compensatory and punitive damages. The Company believes that the Complaint is
without merit and its ultimate disposition will not have a material adverse
effect on the financial condition or results of operations of the Company.

15. RISKS AND UNCERTAINTIES

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Approximately 90% of the Company's sales are products of The Coca-Cola
Company, which is the sole supplier of the concentrate required to manufacture
these products. Additionally, the Company purchases virtually all of its
requirements for sweetener from The Coca-Cola Company.

The Company currently obtains all of its aluminum cans from two domestic
suppliers. The Company currently obtains all of its PET bottles from two
domestic cooperatives. The inability of either of these aluminum can or PET
bottle suppliers to meet the Company's requirement for containers could result
in short-term shortages until alternative sources of supply could be located.

Less than 10% of the Company's labor force is currently covered by
collective bargaining agreements. There are no material collective bargaining
contracts expiring during 1996.

33

COCA-COLA BOTTLING CO. CONSOLIDATED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

16. SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

Changes in current assets and current liabilities affecting cash, net of
effects from acquisitions and divestitures and the effect of an accounting
change, were as follows:

FISCAL YEAR
IN THOUSANDS 1995 1994 1993

Accounts receivable, trade, net............................................................... $(4,342) $(2,796) $(9,319)
Due from Piedmont............................................................................. (3,201) 1,071 (2,454)
Accounts receivable, other.................................................................... (4,471) 5,710 (3,524)
Inventories................................................................................... 3,882 (4,338) (2,939)
Prepaid expenses and other assets............................................................. (1,881) (1,729) (845)
Portion of long-term debt payable within one year............................................. (180) (411) (793)
Accounts payable and accrued liabilities...................................................... 11,232 (9,381) 20,656
Accrued compensation.......................................................................... 803 2,040 (251)
Accrued interest payable...................................................................... (5,016) 1,167 (934)
Increase in current assets less current liabilities........................................... $(3,174) $(8,667) $ (403)

Cash payments for interest and income taxes were as follows:

FISCAL YEAR
IN THOUSANDS 1995 1994 1993

Interest..................................................................................... $36,749 $30,218 $31,417
Income taxes................................................................................. 1,475 56 2,900

17. QUARTERLY FINANCIAL DATA (UNAUDITED)

Set forth below are unaudited quarterly financial data for the fiscal years
ended December 31, 1995 and January 1, 1995.

IN THOUSANDS (EXCEPT PER SHARE DATA) QUARTER
YEAR ENDED DECEMBER 31, 1995 1 2 3 4

Net sales.................................................................... $170,977 $207,876 $203,559 $179,464
Gross margin................................................................. 72,074 87,134 82,727 72,305
Income before extraordinary charge........................................... 1,957 8,054 4,639 886
Extraordinary charge......................................................... (5,016)
Net income (loss)............................................................ 1,957 8,054 4,639 (4,130)
Per share:
Income before extraordinary charge......................................... .21 .87 .50 .09
Extraordinary charge....................................................... (.54)
Net income (loss).......................................................... .21 .87 .50 (.45)
Weighted average number of common shares outstanding......................... 9,294 9,294 9,294 9,294

IN THOUSANDS (EXCEPT PER SHARE DATA) QUARTER
YEAR ENDED JANUARY 1, 1995 1 2 3 4

Net sales.................................................................... $163,817 $200,692 $188,418 $170,969
Gross margin................................................................. 66,333 81,751 75,864 72,808
Income before effect of accounting change.................................... 1,510 6,700 4,899 1,038
Effect of accounting change.................................................. (2,211)
Net income (loss)............................................................ (701) 6,700 4,899 1,038
Per share:
Income before effect of accounting change.................................. .16 .72 .53 .11
Effect of accounting change................................................ (.24)
Net income (loss).......................................................... (.08) .72 .53 .11
Weighted average number of common shares outstanding......................... 9,294 9,294 9,294 9,294

34

REPORT OF INDEPENDENT ACCOUNTANTS

TO THE BOARD OF DIRECTORS AND SHAREHOLDERS
OF COCA-COLA BOTTLING CO. CONSOLIDATED

In our opinion, the consolidated financial statements listed in the index
appearing under Item 14(a) (1) and (2) of this filing present fairly, in all
material respects, the financial position of Coca-Cola Bottling Co. Consolidated
and its subsidiaries at December 31, 1995 and January 1, 1995, and the results
of their operations and their cash flows for each of the three years in the
period ended December 31, 1995, in conformity with generally accepted accounting
principles. These financial statements are the responsibility of the Company's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these statements in
accordance with generally accepted auditing standards which require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for the opinion expressed
above.

During 1994, the Company changed its method of accounting for
postemployment benefits, as described in Note 12.

PRICE WATERHOUSE LLP

Charlotte, North Carolina
February 23, 1996

35

The financial statement schedule required by Regulation S-X is set forth in
response to Item 14 below.

The supplementary data required by Item 302 of Regulation S-K is set forth
in Note 17 to the financial statements.

ITEM 9 -- CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

Not applicable.

PART III

ITEM 10 -- DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

For information with respect to the executive officers of the Company, see
"Executive Officers of the Registrant" at the end of Part I of this Report. For
information with respect to the Directors of the Company, see the "Election of
Directors" and "Certain Transactions" sections of the Proxy Statement for the
1996 Annual Meeting of Shareholders to be filed with the Securities and Exchange
Commission, which is incorporated herein by reference. For information with
respect to Section 16 reports for directors and executive officers of the
Company, see the "Election of Directors -- Beneficial Ownership of Management"
section of the Proxy Statement for the 1996 Annual Meeting of Shareholders.

ITEM 11 -- EXECUTIVE COMPENSATION

For information with respect to executive compensation, see the "Executive
Compensation" section of the Proxy Statement for the 1996 Annual Meeting of
Shareholders to be filed with the Securities and Exchange Commission, which is
incorporated herein by reference (other than the subsections entitled "Report of
the Compensation Committee on Annual Compensation of Executive Officers" and
"Common Stock Performance," which are specifically excluded from such
incorporation).

ITEM 12 -- SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

For information with respect to security ownership of certain beneficial
owners and management, see the "Principal Shareholders" and "Election of
Directors -- Beneficial Ownership of Management" sections of the Proxy Statement
for the 1996 Annual Meeting of Shareholders to be filed with the Securities and
Exchange Commission, which is incorporated herein by reference.

ITEM 13 -- CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

For information with respect to certain relationships and related
transactions, see the "Certain Transactions" and "Compensation Committee
Interlocks and Insider Participation" sections of the Proxy Statement for the
1996 Annual Meeting of Shareholders to be filed with the Securities and Exchange
Commission, which are incorporated herein by reference.

PART IV

ITEM 14 -- EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

A. List of Documents filed as part of this report.

1. Financial Statements

Report of Independent Accountants
Consolidated Balance Sheets
Consolidated Statements of Operations
Consolidated Statements of Cash Flows
Consolidated Statements of Changes in Shareholders' Equity
Notes to Consolidated Financial Statements

2. Financial Statement Schedule

The following financial statement schedule is filed as part
of this report following this Item 14. The Report of Independent
Accountants with respect to the financial statement schedule is
included in Item 8 above.

Schedule II -- Valuation and Qualifying Accounts and Reserves

36

All other financial statements and schedules not listed have
been omitted because the required information is included in the
consolidated financial statements or the notes thereto, or is not
applicable or required.

3. Listing of Exhibits:

(i) Exhibits Incorporated by Reference:

EXHIBIT INDEX

Page Number or
Number Description Incorporation by Reference to

(1.1) Underwriting Agreement dated November 1, 1995 Exhibit 1.1 to the Company's
among the Company, Citicorp Securities, Inc. and Quarterly Report on Form 10-Q
Solomon Brothers, Inc. for the quarter ended October 1,
1995.

(3.1) Bylaws of the Company, as amended. Exhibit 3.2 to the Company's
Registration Statement
(No. 33-54657) on Form S-3.

(3.2) Restated Certificate of Incorporation of the Company. Exhibit 3.1 to the Company's
Registration Statement
(No. 33-54657) on Form S-3.

(4.1) Specimen of Common Stock Certificate. Exhibit 4.1 to the Company's
Registration Statement
(No. 2-97822) on Form S-1.

(4.2) Specimen Fixed Rate Note under the Company's Exhibit 4.1 to the Company's
Medium-Term Note Program, pursuant to which it Current Report on Form 8-K
may issue, from time to time, up to $200 million dated February 14, 1990.
aggregate principal amount of its Medium-Term
Notes, Series A.
.
(4.3) Specimen Floating Rate Note under the Company's Exhibit 4.2 to the Company's
Medium-Term Note Program, pursuant to which it Current Report on Form 8-K
may issue, from time to time, up to $200 million dated February 14, 1990.
aggregate principal amount of its Medium-Term
Notes, Series A.

(4.4) Indenture dated as of October 15, 1989 between the Exhibit 4. to the Company's
Company and Manufacturers Hanover Trust Company Registration Statement
of California, as Trustee, in connection with the Company's (No. 33-31784) on Form S-3
$200 million shelf registration of its Medium-Term as filed on February 14, 1990.
Notes, Series A, due from nine months to 30 years
from date of issue.

(4.5) Selling Agency Agreement, dated as of February 14, Exhibit 1.2 to the Company's
1990, between the Company and Salomon Brothers Registration Statement
and Goldman Sachs, as Agents, in connection with the (No. 33-31784) on Form S-3
Company's $200 million Medium-Term Notes, Series A, as filed on February 14, 1990.
due from nine months to 30 years from date of issue.

(4.6) Form of Debenture issued by the Company to two Exhibit 4.04 to the Company's
shareholders of Sunbelt Coca-Cola Bottling Company, Current Report on Form 8-K
Inc. dated as of December 19, 1991. dated December 19, 1991.

(4.7) Commercial Paper Dealer Agreement, dated as of Exhibit 4.14 to the Company's
February 11, 1993, between the Company and Annual Report on Form 10-K
Citicorp Securities Markets, Inc., as co-agent. for the fiscal year ended
January 3, 1993.

(4.8) Amended and restated commercial paper agreement, Exhibit 4.13 to the Company's
dated as of November 14, 1994, between the Company Annual Report on Form 10-K
and Goldman Sachs Money Markets, L.P. for the fiscal year ended
January 1, 1995.

(4.9) Supplemental Indenture, dated as of March 3, 1995, Exhibit 4.15 to the Company's
between the Company and NationsBank of Georgia, Annual Report, as amended, on
National Association, as Trustee. Form 10-K/A-2 for the fiscal
year ended January 1, 1995.

(4.10) First Omnibus Amendment to Purchase Agreements, Exhibit 4.1 to the Company's
dated as of June 26, 1995, by and among the Company, Quarterly Report on Form 10-Q
as Seller, Corporate Receivables Corporation, as the for the quarter ended July 2,
Investor, and Citicorp North America, Inc., individually 1995.
and as agent.

(4.11) Form of the Company's 6.85% Debentures due 2007. Exhibit 4.1 to the Company's
Quarterly Report on Form 10-Q
for the quarter ended October 1,
1995.

(4.12) The Registrant, by signing this report, agrees to furnish
the Securities and Exchange Commission, upon its request,
a copy of any instrument which defines the rights of
holders of long-term debt of the Registrant and its
subsidiaries for which consolidated financial statements
are required to be filed, and which authorizes a total amount
of securities not in excess of 10 percent of total assets of
the Registrant and its subsidiaries on a consolidated basis.

(4.13) Loan Agreement dated as of November 20, 1995 Exhibit included in this filing.
between the Company and LTCB Trust Company, as
Agent, and other banks named therein.

(4.14) Amended and Restated Credit Agreement dated as of Exhibit included in this filing.
December 21, 1995 between the Company and NationsBank,
N.A., Bank of America National Trust and Savings
Association and other banks named therein.

(10.1) Employment Agreement of James L. Moore, Jr. dated as Exhibit 10.2 to the Company's
of March 16, 1987. Annual Report on Form 10-K
for the fiscal year ended
December 31, 1986.

(10.2) Amendment, dated as of May 18, 1994, to Employment Exhibit 10.84 to the Company's
Agreement designated as Exhibit 10.1. Annual Report on Form 10-K
for the fiscal year ended
January 1, 1995.

(10.3) Stock Rights and Restrictions Agreement by and Exhibit 28.01 to the Company's
between Coca-Cola Bottling Co. Consolidated and Current Report on Form 8-K
The Coca-Cola Company dated January 27, 1989. dated January 27, 1989.

(10.4) Description and examples of bottling franchise agreements Exhibit 10.20 to the Company's
between the Company and The Coca-Cola Company. Annual Report on Form 10-K
for the fiscal year ended
December 31, 1988.

(10.5) Lease, dated as of December 11, 1974, by and between Exhibit 19.6 to the Company's
the Company and the Ragland Corporation, related to the Annual Report on Form 10-K
production/distribution facility in Nashville, Tennessee. for the fiscal year ended
December 31, 1988.

(10.6) Amendment to Lease Agreement designated as Exhibit 19.7 to the Company's
Exhibit 10.5. Annual Report on Form 10-K
for the fiscal year ended
December 31, 1988.

(10.7) Second Amendment to Lease Agreement designated as Exhibit 19.8 to the Company's
Exhibit 10.5. Annual Report on Form 10-K
for the fiscal year ended
December 31, 1988.

(10.8) Supplemental Savings Incentive Plan, dated as of April 1, Exhibit 10.36 to the Company's
1990 between certain Eligible Employees of the Company Annual Report on Form 10-K
and the Company. for the fiscal year ended
December 30, 1990.

(10.9) Description and example of Deferred Compensation Exhibit 19.1 to the Company's
Agreement, dated as of October 1, 1987, between Eligible Annual Report on Form 10-K
Employees of the Company and the Company under for the fiscal year ended
the Officer's Split-Dollar Life Insurance Plan. December 30, 1990.

(10.10) Consolidated/Sunbelt Acquisition Agreement, dated as of Exhibit 2.01 to the Company's
December 19, 1991, by and among the Company and the Current Report on Form 8-K
shareholders of Sunbelt Coca-Cola Bottling Company, Inc. dated December 19, 1991.

(10.11) Officer Retention Plan, dated as of January 1, 1991, Exhibit 10.47 to the Company's
between certain Eligible Officers of the Company and the Annual Report on Form 10-K
Company. for the fiscal year ended
December 29, 1991.

(10.12) Acquisition Agreement, by and among Sunbelt Coca-Cola Exhibit 10.50 to the Company's
Bottling Company, Inc., Sunbelt Carolina Acquisition Annual Report on Form 10-K
Company,Inc., certain of the common stockholders of for the fiscal year ended
Coca-Cola Bottling Co. Affiliated, Inc., and the stock- ended December 29, 1991.
holders of TRNH, Inc., dated as of November 7, 1989.

(10.13) Amendment Number One to the Sunbelt/Affiliated Exhibit 10.04 to the Company's
Acquisition Agreement, dated as of December 29, 1989, Quarterly Report on Form 10-Q
between Sunbelt Coca-Cola Bottling Company, Inc., for the quarter ended March 29,
Sunbelt Carolina Acquisition Company, Inc., certain 1992.
of the common stockholders of Coca-Cola Bottling Co.
Affiliated, Inc. and the stockholders of TRNH, Inc.

(10.14) Amendment Number Two to the Sunbelt/Affiliated Exhibit 10.05 to the Company's
Acquisition Agreement, dated as of December 29, 1989, Quarterly Report on Form 10-Q
between Sunbelt Coca-Cola Bottling Company, Inc., for the quarter ended March 29,
Sunbelt Carolina Acquisition Company, Inc., certain of 1992.
the common stockholders of Coca-Cola Bottling Co.
Affiliated, Inc. and the stockholders of TRNH, Inc.

(10.15) Amendment Number Three to the Sunbelt/Affiliated Exhibit 10.06 to the Company's
Acquisition Agreement, dated as of December 29, 1989, Quarterly Report on Form 10-Q
between Sunbelt Coca-Cola Bottling Company, Inc., for the quarter ended March 29,
Sunbelt Carolina Acquisition Company, Inc., certain of 1992.
the common stockholders of Coca-Cola Bottling Co.
Affiliated, Inc. and the stockholders of TRNH, Inc.

(10.16) Lease Agreement, dated as of November 30, 1992, between Exhibit 10.38 to the Company's
the Company and Harrison Limited Partnership One, Annual Report on Form 10-K
related to the Snyder Production Center in Charlotte, for the fiscal year ended
North Carolina. January 3, 1993.

(10.17) Termination and Release Agreement dated as of March 27, Exhibit 10.43 to the Company's
1992 by and among Sunbelt Coca-Cola Bottling Company, Annual Report on Form 10-K
Coca-Cola Bottling Co. Affiliated, Inc., the agent for for the fiscal year ended
holders of certain debentures of Sunbelt issued pursuant January 3, 1993.
to a certain Indenture dated as of January 11, 1990, as
amended, and Wilmington Trust Company which acted as
trustee under the Indenture.

(10.18) Reorganization Plan and Agreement by and among Exhibit 10.03 to the Company's
Coca-Cola Bottling Co. Consolidated, Chopper Acquisitions, Quarterly Report on Form 10-Q
Inc., Whirl-i-Bird, Inc. and J. Frank Harrison, Jr. for the quarter ended April 4,
1993.

(10.19) Partnership Agreement of Carolina Coca-Cola Bottling Exhibit 2.01 to the Company's
Partnership,* dated as of July 2, 1993, by and among Current Report on Form 8-K
Carolina Coca-Cola Bottling Investments, Inc., Coca-Cola dated July 2, 1993.
Ventures, Inc., Coca-Cola Bottling Co. Affiliated, Inc.,
Fayetteville Coca-Cola Bottling Company and Palmetto
Bottling Company.

(10.20) Asset Purchase Agreement, dated as of July 2, 1993, by Exhibit 2.02 to the Company's
and among Carolina Coca-Cola Bottling Partnership,* Current Report on Form 8-K
Coca-Cola Bottling Co. Affiliated, Inc. and Coca-Cola dated July 2, 1993.
Bottling Co. Consolidated.

(10.21) Asset Purchase Agreement, dated as of July 2, 1993, by Exhibit 2.03 to the Company's
and among Carolina Coca-Cola Bottling Partnership,* Current Report on Form 8-K
Fayetteville Coca-Cola Bottling Company and Coca-Cola dated July 2, 1993.
Bottling Co. Consolidated.

(10.22) Asset Purchase Agreement, dated as of July 2, 1993, by Exhibit 2.04 to the Company's
and among Carolina Coca-Cola Bottling Partnership,* Current Report on Form 8-K
Palmetto Bottling Company and Coca-Cola Bottling Co. dated July 2, 1993.
Consolidated.

(10.23) Definition and Adjustment Agreement, dated July 2, 1993, Exhibit 2.05 to the Company's
by and among Carolina Coca-Cola Bottling Partnership,* Current Report on Form 8-K
Coca-Cola Ventures, Inc., Coca-Cola Bottling Co. dated July 2, 1993.
Consolidated, CCBC of Wilmington, Inc., Carolina
Coca-Cola Bottling Investments, Inc., The Coca-Cola
Company, Carolina Coca-Cola Holding Company, The
Coastal Coca-Cola Bottling Company, Eastern Carolina
Coca-Cola Bottling Company, Inc., Coca-Cola Bottling Co.
Affiliated, Inc., Fayetteville Coca-Cola Bottling Company
and Palmetto Bottling Company.

(10.24) Management Agreement, dated as of July 2, 1993, by and Exhibit 10.01 to the Company's
among Coca-Cola Bottling Co. Consolidated, Carolina Current Report on Form 8-K
Coca-Cola Bottling Partnership,* CCBC of Wilmington, dated July 2, 1993.
Inc., Carolina Coca-Cola Bottling Investments, Inc.,
Coca-Cola Ventures, Inc. and Palmetto Bottling Company.

(10.25) Post-Retirement Medical and Life Insurance Benefit Exhibit 10.02 to the Company's
Reimbursement Agreement, dated July 2, 1993, by and Current Report on Form 8-K
between Carolina Coca-Cola Bottling Partnership* and dated July 2, 1993.
Coca-Cola Bottling Co. Consolidated.

(10.26) Aiken Asset Purchase Agreement, dated as of August 6, Exhibit 2.01 to the Company's
1993 by and among Carolina Coca-Cola Bottling Quarterly Report on Form 10-Q
Partnership,* Palmetto Bottling Company and Coca-Cola for the quarter ended July 4,
Bottling Co. Consolidated. 1993.

(10.27) Aiken Definition and Adjustment Agreement, dated as of Exhibit 2.02 to the Company's
August 6, 1993, by and among Carolina Coca-Cola Quarterly Report on Form 10-Q
Bottling Partnership*, Coca-Cola Ventures, Inc., Coca-Cola for the quarter ended July 4,
Bottling Co. Consolidated, Carolina Coca-Cola Bottling 1993.
Investments, Inc., The Coca-Cola Company and Palmetto
Bottling Company.

(10.28) Lease Agreement, dated as of June 1, 1993, between the Exhibit 10.01 to the Company's
Company and Beacon Investment Corporation, related Quarterly Report on Form 10-Q
to the Company's corporate headquarters in Charlotte, for the quarter ended July 4,
North Carolina. 1993.

(10.29) Amended and Restated Guaranty Agreement, dated as of Exhibit 10.06 to the Company's
July 15, 1993 re: Southeastern Container, Inc. Quarterly Report on Form 10-Q
for the quarter ended July 4,
1993.

(10.30) Agreement, dated as of December 23, 1993, between Exhibit 10.1 to the Company's
the Company and Western Container Corporation Quarterly Report on Form 10-Q
covering purchase of PET bottles. for the quarter ended
October 2, 1994.

(10.31) Management Agreement, dated as of June 1, 1994, by Exhibit 10.6 to the Company's
and among Coca-Cola Bottling Co. Consolidated and Quarterly Report on Form 10-Q
South Atlantic Canners, Inc. for the quarter ended July 3,
1994.

(10.32) Guaranty Agreement, dated as of July 22, 1994, between Exhibit 10.7 to the Company's
Coca-Cola Bottling Co. Consolidated and Wachovia Quarterly Report on Form 10-Q
Bank of North Carolina, N.A. for the quarter ended July 3, 1994.

(10.33) Selling Agency Agreement, dated as of March 3, 1995, Exhibit 10.83 to the Company's
between the Company, Salomon Brothers Inc. and Annual Report on Form 10-K
Citicorp Securities, Inc. for the fiscal year ended
January 1, 1995.

(10.34) Agreement, dated as of March 1, 1994, between the Exhibit 10.85 to the Company's
Company and South Atlantic Canners, Inc. Annual Report on Form 10-K
for the fiscal year ended
January 1, 1995.

(10.35) Stock Option Agreement, dated as of March 8, 1989, Exhibit 10.86 to the Company's
of J. Frank Harrison, Jr. Annual Report on Form 10-K
for the fiscal year ended
January 1, 1995.

(10.36) Stock Option Agreement, dated as of August 9, 1989, Exhibit 10.87 to the Company's
of J. Frank Harrison, III. Annual Report on Form 10-K for
the fiscal year ended January 1,
1995.

(10.37) First Amendment to Credit Agreement, Line of Credit Exhibit 10.8 to the Company's
Note and Mortgage, and Reaffirmation of Term Note, Quarterly Report on Form 10-Q
Security Agreement, Guaranty Agreement and Addendum for the quarter ended April 2,
to Guaranty Agreement, dated as of March 31, 1995, by 1995.
and among the Company, South Atlantic Canners, Inc.
and Wachovia Bank of North Carolina, N.A.

(10.38) Guaranty Agreement and Addendum, dated as of March 31, Exhibit 10.9 to the Company's
1995, between the Company and Wachovia Bank of North Quarterly Report on Form 10-Q
Carolina, N.A. for the quarter ended April 2,
1995.

(10.39) Can Supply Agreement, dated November 7, 1995, between Exhibit 10.16 to the Company's
the Company and American National Can Company. Quarterly Report on Form 10-Q
for the quarter ended October 1,
1995.

(10.40) Lease Agreement, dated as of July 17, 1988, between the Exhibit 19.4 to the Company's
Company and GE Capital Fleet Services covering Quarterly Report on Form 10-Q
various vehicles. for the quarter ended March 31,
1990.

(10.41) Master Motor Vehicle Lease Agreement, dated as of Exhibit 19.5 to the Company's
December 15, 1988, between the Company and Quarterly Report on Form 10-Q
Citicorp North America, Inc. covering various vehicles. for the quarter ended March 31,
1990.

(10.42) Master Lease Agreement, beginning on April 12, 1989, Exhibit 19.6 to the Company's
between the Company and Citicorp North America, Quarterly Report on Form 10-Q
Inc. covering various equipment. for the quarter ended March 31,
1990.

(10.43) Master Lease Agreement, dated as of January 7, 1992 Exhibit 10.01 to the Company's
between the Company and Signet Leasing and Financial Quarterly Report on Form 10-Q
Corporation covering various vehicles. for the quarter ended March 29,
1992.

(10.44) Master Equipment Lease, dated as of February 9, 1993, Exhibit 10.37 to the Company's
between the Company and Coca-Cola Financial Annual Report on Form 10-K
Corporation covering various vending machines. for the fiscal year ended
January 3, 1993.

(10.45) Motor Vehicle Lease Agreement No. 790855, dated as of Exhibit 10.39 to the Company's
December 31, 1992, between the Company and Citicorp Annual Report on Form 10-K
Leasing, Inc. covering various vehicles. for the fiscal year ended
January 3, 1993.

(10.46) Master Lease Agreement, dated as of February 18, 1992, Exhibit 10.69 to the Company's
between the Company and Citicorp Leasing, Inc. Annual Report on Form 10-K
covering various equipment. for the fiscal year ended
January 2, 1994.

(10.47) Lease Agreement dated as of December 15, 1994 between Exhibit 10.1 to the Company's
the Company and BA Leasing & Capital Corporation. Quarterly Report on Form 10-Q
for the quarter ended April 2,
1995.

(10.48) Beverage Can and End Agreement dated November 9, 1995 Exhibit included in this filing.
between the Company and Ball Metal Beverage Container
Group.

(10.49) Member Purchase Agreement, dated as of August 1, Exhibit included in this filing.
1994 between the Company and South Atlantic
Canners, Inc., regarding minimum annual purchase
requirements of canned product by the Company.

(10.50) Member Purchase Agreement, dated as of August 1, 1994 Exhibit included in this filing.
between the Company and South Atlantic Canners, Inc.,
regarding minimum annual purchase requirements of
20 ounce PET product by the Company.

(10.51) Member Purchase Agreement, dated as of August 1, 1994 Exhibit included in this filing.
between the Company and South Atlantic Canners, Inc.,
regarding minimum annual purchase requirements of 2 Liter
PET product by the Company.

(10.52) Member Purchase Agreement, dated as of August 1, 1994 Exhibit included in this filing.
between the Company and South Atlantic Canners, Inc.,
regarding minimum annual purchase requirements of 3 Liter
PET product by the Company.

(10.53) Description of the Company's 1996 Bonus Plan for officers. Exhibit included in this filing.

(21.1) List of subsidiaries. Exhibit included in this filing.

(23.1) Consent of Independent Accountants to Incorporation by Exhibit included in this filing.
Reference into Form S-3 (Registration No. 33-4325) and
Form S-3 (Registration No. 33-54657).

(27.1) Financial data schedule for period ended December 31, Exhibit included in this filing.
1995.

(99.1) Audited Financial Statements of Piedmont Coca-Cola Included as Item 14D of Part IV
Bottling Partnership for the 1994 and 1993 fiscal periods. to the Company's Annual Report
on Form 10-K for the fiscal year
ended January 1, 1995.

(99.2) Information, financial statements and exhibits required To be supplied by amendment.
by Form 11-K with respect to the Coca-Cola Bottling Co.
Consolidated Savings Plan.

* Carolina Coca-Cola Bottling Partnership's name was changed to Piedmont
Coca-Cola Bottling Partnership.

B. Reports on Form 8-K.

There were no Current Reports on Form 8-K filed by the Company during
the fourth quarter of 1995.

40

SCHEDULE II

COCA-COLA BOTTLING CO. CONSOLIDATED

VALUATION AND QUALIFYING ACCOUNTS AND RESERVES

(IN THOUSANDS)

ADDITIONS
BALANCE AT CHARGED TO
BEGINNING COSTS AND BALANCE AT
DESCRIPTION OF YEAR EXPENSES OTHER (1) DEDUCTIONS END OF YEAR

Allowance for doubtful accounts:
Fiscal year ended December 31, 1995.................... $ 400 $319 $ 313 $ 406
Fiscal year ended January 1, 1995...................... $ 425 $600 $ 625 $ 400
Fiscal year ended January 2, 1994...................... $ 400 $443 $ (20) $ 398 $ 425

Deferred tax assets valuation allowance:
Fiscal year ended January 2, 1994...................... $ 29,934 $ (26,718) $3,216 $ 0

(1) Arising from business combinations and divestitures.

41

SIGNATURES

Pursuant to the requirements of Section 13 or 15 (d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

COCA-COLA BOTTLING CO. CONSOLIDATED
(REGISTRANT)

Date: March 27, 1996

By: /s/ JAMES L. MOORE, JR.
JAMES L. MOORE, JR.
PRESIDENT AND CHIEF OPERATING OFFICER

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

By: /s/ J. FRANK HARRISON, JR. Chairman of the Board and Director March 27, 1996
J. FRANK HARRISON, JR.

By: /s/ J. FRANK HARRISON, III Vice Chairman of the Board, Chief Executive March 27, 1996
Officer and Director
J. FRANK HARRISON, III

By: /s/ JAMES L. MOORE, JR. President and Chief Operating Officer and March 27, 1996
Director
JAMES L. MOORE, JR.

By: /s/ REID M. HENSON Vice Chairman of the Board and Director March 27, 1996
REID M. HENSON

By: /s/ H. W. MCKAY BELK Director March 27, 1996
H. W. MCKAY BELK

By: /s/ JOHN M. BELK Director March 27, 1996
JOHN M. BELK

By: /s/ H. REID JONES Director March 27, 1996
H. REID JONES

By: /s/ DAVID L. KENNEDY, JR. Director March 27, 1996
DAVID L. KENNEDY, JR.

By: /s/ NED R. MCWHERTER Director March 27, 1996
NED R. MCWHERTER

By: /s/ JOHN W. MURREY, III Director March 27, 1996
JOHN W. MURREY, III

By: /s/ DAVID V. SINGER Vice President and Chief Financial Officer March 27, 1996
DAVID V. SINGER

By: /s/ STEVEN D. WESTPHAL Vice President and Chief Accounting Officer March 27, 1996
STEVEN D. WESTPHAL

42