Kirin Holdings Co. Ltd. · TSE:2503

Kirin — Investor Presentation (April 2017)

21 slides from Kirin's investor presentation, Apr 12, 2017

  1. Slide 1: For Sustainable “Profitable Growth”

    For Sustainable “Profitable Growth” April 12, 2017 Kirin Beverage Company, Ltd.

  2. Slide 2: HORIGUCHI, Hideki (Mr.)

    Name: HORIGUCHI, Hideki (Mr.) Professional Experience: Mar 2016-Present President & CEO of Kirin Beverage Company, Ltd. Mar 2014-Mar 2016 Representative Director, President & CEO of Koiwai Dairy Products Company Limited Mar 2013-Mar 2014 Managing Director of Koiwai Dairy Products Company, Limited Ma

  3. Slide 3: Introduction: Background to 2016 MTBP

    Introduction: Background to 2016 MTBP In 2015, both sales and operating income increased year-on-year due to a significant increase in sales volume; however, operating income did not meet its target due to increased selling expenses and deterioration in the mix of products sold in terms of package s

  4. Slide 4: Structural reform for “Profitable Growth”

    Kirin Beverage Group 2016 MTBP structural reform for “Profitable Growth” Build robust brand Reform profit structure framework ［Measures to improve profitability］  Build robust brand framework • Focus on the ３ major categories (sugar-free tea, carbonated drinks, and coffee)  Reform profit structure

  5. Slide 5: 2016 Review

    2016 Review Sales volume increase: +8% (market: +2%) Operating income increase (year-on-year): +11.6 billion yen OPM: 4.9% Sales volume Sales Operating income 2018 Guidance OPM(%) (million cases) (bn yen) (bn yen) OPM: FY2015 (actual) 217.28 372.0 5.6 1.5% 3％+ FY2016 (actual) 234.96 *354.6 17.2 4.9％

  6. Slide 6: Structural reform for “Profitable Growth”: profit structure

    Kirin Beverage change 1 structural reform for “Profitable Growth” Build robust brand Reform profit structure framework From management based on the total number of cases (incl. large PET bottles) to target control focused on cans and small PET bottles Shift to profit-driven management Price zone cha

  7. Slide 7: Structural reform for “Profitable Growth”: focused brands

    Kirin Beverage change 2 structural reform for “Profitable Growth” Build robust brand Reform profit structure framework Shift to intensive marketing of selected products  Identification of focus brands and continuous investment  Strengthening of the unique brand Gogo-no-kocha (+9% YonY in volume） 

  8. Slide 8: Kirin Beverage change 2: Successful Nama-cha renewal

    Kirin Beverage change 2: Successful Nama-cha renewal Zero-based development Re-definition of “Nama” Company-wide efforts resulted in sales of 26 million cases (more than 1.5 times the beginning-of-year target) Product Manufa- Distribu- Sales Simple messages planning cturing tion & collaboration Tech

  9. Slide 9: Kirin Beverage change 3: Successful outcome = Strategy × Execution

    Kirin Beverage change 3 Successful outcome = Strategy × Execution Goals of organizational capabilities for better “Execution” ■Promote employeesʼ creativity • Highly transparent management (information sharing, various systems) • Alignment  Easy-to-understand policy  Frequent micro-level communica

  10. Slide 10: 2017 Plan

    2017 Plan © Kirin Beverage Company, Limited 9

  11. Slide 11: Market trends

    Market trends © Kirin Beverage Company, Limited 10

  12. Slide 12: 2017 Plan: Second stage of Profitable Growth

    2017 Plan Sales volume increase: +0% (market: -1〜0%) Operating income increase: +0.8 billion yen (year-on-year) OPM: 5.1% Sales volume Sales Operating income 2018 Guidance OPM(%) (million cases) (bn yen) (bn yen) OPM: FY2016 (actual) 234.96 354.6 17.2 4.9％ 3％+ FY2017 (forecast) *233.50 349.7 18.0 5.

  13. Slide 13: 2017 Strategy: Outline

    2017 Strategy: Outline Realize ”Profitable Growth” by carrying out ”Quality with Surprise” Vision Build robust brand Sift to profitable framework business structure Strategic pillars Execution Improved Organizational Capability Drivers of strategy © Kirin Beverage Company, Limited 12

  14. Slide 14: A possible sustainable brand portfolio

    A Possible sustainable brand portfolio structural reform for “Profitable Growth” Build robust brand framework Reform profit structure Current profit source Invest Invest/Maintain High Investment for future Water Health & Well-being Coffee （small-size） Green Tea Carbonated Drinks Black Tea Profitabil

  15. Slide 15: 2017 Initiatives: brand framework

    2017 Initiatives structural reform for “Profitable Growth” Build robust brand Reform profit structure framework ［Initiatives］  Strengthening of focused brands via × Kirinʼs unique selective, focused allocation of resources vending machine service Portfolio “Tappiness” Growth Strategic Health and ca

  16. Slide 16: 2017 Initiatives: reform profit structure

    2017 Initiatives structural reform for “Profitable Growth” Build robust brand Reform profit structure framework  Reform profit structure  Further strengthening management based on small-size products ・Sales volume increase in small-size products (+2% YonY)  Supply chain cost reduction ・Decrease i

  17. Slide 17: Sales trends: First quarter by brand

    Sales trends: First quarter by brand Number of Cases YonY （ʼ1000 cases） Total Sales Volume 47,180 103% Focused brands Gogo-no-kocha 12,670 107% Nama-cha 5,670 139% FIRE 6,080 96% Volvic 1,080 86% Water Alkali Ion Water 5,710 90% © Kirin Beverage Company, Limited 16

  18. Slide 18: Sales trends: First quarter by container

    Sales trends: First quarter by container Number of cases Proportion （ʼ1000 cases） YonY 2017 act 2016 act Can Total 9,040 100% 19.2% 19.8% Packaging (extracted) PET Total 34,310 105% 72.7% 71.8% Large PET Total 15,080 102% 32.0% 32.5% Small PET Total 19,230 107% 40.8% 39.2% © Kirin Beverage Company,

  19. Slide 19: For sustainable growth

    For sustainable growth Will have realized “profitable growth” by carrying out “Quality with Surprise” Provide truly innovative and tasty products beyond consumersʼ expectations at reasonable prices, contributing to a healthy and exciting daily life Sustainable Profitable Growth Alliances Organic gro

  20. Slide 20: KIRIN

    KIRIN TRAD) VHS HSCLT, (aNEDAB |) PHSRSLCULTWS.

  21. Slide 21: This material is intended for informational purposes only and is not a solicitation or

    This material is intended for informational purposes only and is not a solicitation or offer to buy or sell securities or related financial instruments. © Kirin Beverage Company, Limited 20

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