Sapporo Holdings Limited · TSE:2501
Sapporo — FY2014 Earnings Presentation
41 slides from Sapporo's earnings presentation, Feb 13, 2015
Slide 1: Sapporo Group Business Results Presentation for 2014
Sapporo Group Business Results Presentation for 2014 February 13, 2015 Sapporo Holdings Ltd. URL http://www.sapporoholdings.jp/english Copyright, 2015 SAPPORO HOLDINGS LTD. All rights reserved. 1/41
Slide 2: Contents
Contents 1. Overview of 2014 - Group Overview - Topics by Business 2. Sapporo Group Management Plan 2015 - 2016 3. Overview of 2014 Results Reference material: Appendix “Supplementary Information to the Earnings Report” Reference 1. Supplementary Information to 2014 Results (Overview by Business Seg
Slide 3: 1. Overview of 2014
1. Overview of 2014 Copyright, 2015 SAPPORO HOLDINGS LTD. All rights reserved. 3/41
Slide 4: Overview of 2014 - Group Overview
Overview of 2014 - Group Overview - Responding to changes in the business environment Amid unexpected tough business environment such as inclement weather in Japan and North America, changes to external environment including rise in raw ingredient prices and temporary end of sales Goku Zero, the G
Slide 5: Overview of 2014 Topics by Business (1)
Overview of 2014 Topics by Business (1) Japanese Alcoholic Beverages Sales volume of beer and beer-type beverages (beer, happoshu and new genre) up 1% yoy (total demand down 2% yoy) Total Management resources focused on premium beer demand Sapporo “Yebisu,” standard beer “Black Label” and new genr
Slide 6: Overview of 2014 Topics by Business (2)
Overview of 2014 Topics by Business (2) International Business North Despite headwinds such as intensified competition, inclement weather and sharp rise in raw ingredient prices, America the business secured profits as the Group steadily implemented countermeasures SLEEMAN Net Sales (before elimin
Slide 7: Overview of 2014 Topics by Business (3)
Overview of 2014 Topics by Business (3) Food & Soft Drinks POKKA SAPPORO Food & Beverages Ltd. posted operating income (after goodwill amortization) in its second year in business Domestic Food & Soft Drinks: POKKA SAPPORO Food & Domestic soft drinks: Sales, affected by bad weather Beverages Ltd
Slide 8: Overview of 2014 Topics by Business (4)
Overview of 2014 Topics by Business (4) Restaurants 2014 sales at existing outlets were up 0.5% compared with the previous year (excluding the Ginza 5-chome and Shimbashi restaurants which were closed for building reconstruction) Restaurants business in Japan Sales for all outlets declined as op
Slide 9: Overview of 2014 Topics by Business (5)
Overview of 2014 Topics by Business (5) Real Estate Drove forward three projects to ensure future contributions to Group earnings given the strong real estate market in the Tokyo Metropolitan area Yebisu Garden Place Yebisu Garden Place Leasing to a new tenant after the end of the lease contract
Slide 10: 2. Sapporo Group Management Plan 2015-2016
2. Sapporo Group Management Plan 2015-2016 Copyright, 2015 SAPPORO HOLDINGS LTD. All rights reserved. 10/41
Slide 11: Outline of the Management Plan
Sapporo Group Management Plan 2015-2016 Outline of the Management Plan ◆ The SAPPORO Group has been investing in its Japanese alcoholic beverages and real estate businesses, which are pillar businesses that generate steady profits; the international business and the food & soft drinks business for f
Slide 12: Financial Targets
Financial Targets Management Indicator Targets of Management Plan 2015–2016 [Quantitative targets] ・ROE: 8% or higher in 2016 ・D/E ratio: around 1.0 in 2016 * By setting ROE as the highest priority indicator, the Company will enhance profitability and efficiency and realize a sound financial structu
Slide 13: 2015-2016 Targets Based on Current Businesses
2015-2016 Targets Based on Current Businesses 2016 New 2014 results 2015 targets 2016 targets Management Framework Management Plan Consolidated net sales ¥518.7bn ¥545.7bn ¥579.5bn ¥600.0 bn *incl. liquor tax Consolidated operating income (before goodwill amortization) ¥18.4bn ¥20.7bn ¥28.0bn ¥40.0
Slide 14: 2015-2016 Targets Based on Current Businesses by Segment
2015-2016 Targets Based on Current Businesses by Segment Management Plan 2014 results 2015 targets 2016 targets Japanese Alcoholic Beverages ¥281.8bn ¥290.2bn ¥305.0bn International ¥49.6bn ¥67.8bn ¥76.0bn Net sales Food & Soft Drinks ¥133.4bn ¥133.7bn ¥141.7bn Restaurants ¥26.3bn ¥27.2bn ¥27.5bn Re
Slide 15: 2015-2016 Japanese Alcoholic Beverages
2015-2016 Japanese Alcoholic Beverages “Seek No.1 by accumulating one-of-a-kind products” Strengthen cultivation of brand in each field Key points in Management Plan ■ Beer business ➤Concentrate investments on the core brands to further enhance brand value ➤Propose functionalities of new core brands
Slide 16: 2015-2016 International
2015-2016 International Promote further market penetration of the Sapporo brand around the world Key points in Management Plan ■Canada, U.S. ■Southeast Asia ➤Optimize brand portfolio and strengthen ➤In Vietnam, accelerate expansion of beer market penetration business, improve operating income (loss)
Slide 17: Country Pure Foods Inc. (CPF)
Country Pure Foods Inc. (CPF) CPF profile Strength in commercial-use sales to non-commercial organizations such as educational and medical institutions mainly in the U.S. and it is also engaged in production of private brand products for major retail chains and contract manufacturing for major bever
Slide 18: 2015-2016 Food & Soft Drinks
2015-2016 Food & Soft Drinks Move on to growth stage by cultivating brands and implementing structural reform Key points in Management Plan ■ Domestic food & soft drinks ■ Restaurants in Japan ➤ Establish and cultivate our core lemon- ➤ Open new formats of the development of based product and soup b
Slide 19: 2015-2016 Restaurants
2015-2016 Restaurants Expand the Beer Hall restaurant format in Japan and overseas to disseminate beer hall culture to the world Key points in Management Plan ■ Japan ➤Expand the Beer Hall restaurant format, to solidify our market position and improve earning capability ➤Aggressively renovate existi
Slide 20: 2015-2016 Real Estate
2015-2016 Real Estate Strengthen the Group’s earnings base by enhancing the value of our properties Key points in Management Plan ■ For sustainable growth of the business ➤Promote value of Yebisu Garden Place by strengthening the office, commercial and dining functions and to enhance the brand value
Slide 21: 2015-2016 R&D Strategies
2015-2016 R&D Strategies Promote offering of products and services of value through research and development that leverages the Group resources to the maximum extent ■Lactic acid bacteria ■Next generation energy ➤Propose high value added products with ➤Based on the fermentation the Group’s proprieta
Slide 22: Strengthen Corporate Governance
Strengthen Corporate Governance Strengthen corporate governance overseas as well as in Japan ◆ Of the 10 Sapporo Holdings directors, three are independent outside directors, who have been contributing to promoting an adequate governance structure by actively expressing their views, etc. ◆ Familiariz
Slide 23: Policy Regarding Return of Profits to Shareholders
Policy Regarding Return of Profits to Shareholders Providing fair returns to shareholders is a key management policy of the Company. Our basic policy is to pay stable dividends, taking our operating performance and financial condition into account. Concerning our internal reserves, we will appropria
Slide 24: 3. Overview of 2014 Results
3. Overview of 2014 Results *For information on the profitability of each business, please see the Supplementary Information to our Earnings Report. Copyright, 2015 SAPPORO HOLDINGS LTD. All rights reserved. 24/41
Slide 25: Overview of 2014 Results (1) Vs. 2013
Overview of 2014 Results (1) Vs. 2013 YoY changes (billions of yen) 2013 results 2014 results Net sales: up YoY (amount, %) ・ Japanese Alcoholic Beverages: sales increased, as Japanese Alcoholic sales volume of beer and beer-type beverages rose Beverages 274.9 281.8 6.9 2.5% compared with the same
Slide 26: Overview of 2014 Results (2) Vs. Initial Targets
Overview of 2014 Results (2) Vs. Initial Targets 2014 vs. target 2014 results (billions of yen) targets* (amount, %) Net sales: -3.5％ vs. target Japanese Alcoholic ・Japanese Alcoholic Beverages: Sales of beer and beer- Beverages 284.3 281.8 (2.4) (0.9)% type beverages fell short of the target. The
Slide 27: Overview of 2014 Results (3) Status of Capital Expenditure
Overview of 2014 Results (3) Status of Capital Expenditure Implementation Status of Strategic Investments (Including Ordinary Capex, on a cash basis) Credit Ratings ①<Capital expenditure and lease fees> <Credit rating by JCR> Consolidated total: Approx. ¥22.5 bn As of February 13, 2015: A- (stable
Slide 28: Reference 1: Supplementary Information to 2014 Results
Reference 1: Supplementary Information to 2014 Results (Overview by Business Segment) * For information on the profitability of each business, please see the Supplementary Information to our Earnings Report. Copyright, 2015 SAPPORO HOLDINGS LTD. All rights reserved. 28/41
Slide 29: Japanese Alcoholic Beverages
Japanese Alcoholic Beverages *Incl. liquor taxes (billions of yen) YoY change Results highlights Net sales increased year over year , as total sales volumes 2013 2014 Amount % for beer and beer-type beverages rose 1% and sales of wine, western spirits, Japanese liquor and RTD also grew. Net sales* 2
Slide 30: International
International (billions of yen) 単位：億円 YoY change Results highlights 2013 2014 Amount % Sales fell due to intensifying competition in Canada and Net Sales 48.2 49.6 1.4 3.0% the impact of the cold wave in the U.S. , while the business in Vietnam grew steadily. Net sales increased Operating partly due
Slide 31: Food & Soft Drinks
Food & Soft Drinks Results highlights (billions of yen) YoY change While sales of the domestic food and soft drinks business 2013 2014 Amount % declined slightly into the second year of the integration, those of the overseas soft drinks business increased. Partly due to foreign exchange fluctuation,
Slide 32: Restaurants
Restaurants Results highlights (billions of yen) YoY change Net sales declined, although comparable-store sales were 100.5% in 2014. This is mainly attributable to the inclement weather and 2013 2014 Amount % the fact that key restaurants in Ginza and Shimbashi suspended operations as the buildings
Slide 33: Real Estate
Real Estate (billions of yen) Results highlights YoY change Both sales and profits declined year over year due to a decline in rents resulting from reconstruction of Sapporo Ginza Building 2013 2014 Amount % *The property portfolio largely comprises the following properties in Tokyo (5 central wards
Slide 34: Reference 2: Sapporo Group's New Management Framework Announced in 2007
Reference 2: Sapporo Group’s New Management Framework Announced in 2007 Copyright, 2015 SAPPORO HOLDINGS LTD. All rights reserved. 34/41
Slide 35: Sapporo Group's New Management Framework Announced in 2007
Sapporo Group’s New Management Framework Announced in 2007 Basic approach for working steadily toward long-term goals while also boldly revising management resource allocation, executing strategic investments, and enhancing competitiveness through “aggressive management” New Management Framework (fo
Slide 36: Sapporo Group's Business Domains
Sapporo Group’s Business Domains Sapporo Group Creating value in food Creating comfortable surroundings International Restaurants Japanese Alcoholic Real Estate Food & Soft Drinks Beverages Stable profit contribution Stable profit contribution from the group’s core backed by businesses prime propert
Slide 37: Profit Growth and Profit Management
Profit Growth and Profit Management (Consolidated Operating Income) Impact of competitive sales promotions within Steady profit growth the industry in reaction to the earthquake after the financial crisis disaster Billions of yen Target achieved 20.0 20.0 18.8 18.0 Current Target achieved Target ach
Slide 38: Changes to Sapporo Group
Changes to Sapporo Group Promoting diversification of business portfolio through M&As and alliances 2013 2012 Started operations of Initiatives Acquired 15% 2008 stake in Yebisu POKKA SAPPORO thus far Sold 15% 2011 stake in Garden Place Food & Beverages Yebisu Garden Entered western Japan Place spir
Slide 39: What Sapporo Group aspires to be in 2026
Formulation of Next Long-term Management Framework What Sapporo Group aspires to be in 2026 (150th anniversary) The SAPPORO Group will be a group of companies that is essential for customers to enjoy rich lives throughout the world by continuing the creation and supply new products and services that
Slide 40: Guidelines for corporate behavior
Formulation of Next Long-term Management Framework Guidelines for corporate behavior 1. We seek continued innovation and provide customers with valuable No. 1 products and services to contribute to their attainment of a richer life 2. We endeavor to create products and services that will activate co
Slide 41: As an intrinsic part of people's lives, Sapporo will contribute to the evolution of
As an intrinsic part of people's lives, Sapporo will contribute to the evolution of creative, enriching and rewarding lifestyles. The earnings forecasts and forward-looking statements appearing in this document were prepared by the SAPPORO Group based on currently available information and its best