Sapporo Holdings Limited · TSE:2501
Sapporo — H1 2022 Earnings Presentation
40 slides from Sapporo's earnings presentation, Aug 12, 2022
Slide 1: Sapporo Group Business Results Presentation for the Six Months Ended June 30, 2022
Sapporo Group Business Results Presentation for the Six Months Ended June 30, 2022 *In this document, the following company name abbreviations are used: August 12th 2022 SH: Sapporo Holdings Limited SB: Sapporo Breweries Ltd. SLN: Sapporo Lion Limited. URL https://www.sapporoholdings.jp/en/ PS: Pokk
Slide 2: １． Summary ２． Business Results ３． Appendix
１． Summary ・・・P3~P8 ２． Business Results ・・・P9~P21 ３． Appendix ・・・P22~P40 Copyright, 2022 SAPPORO HOLDINGS LTD. All rights reserved. 2/40
Slide 3: Summary
Summary Copyright, 2022 SAPPORO HOLDINGS LTD. All rights reserved. 3/40
Slide 4: Financial Summary
Financial Summary Business Results for 2022 Q2 Revenue: 213.8 billion yen (up 14.1 billion yen YoY) In addition to the growth in overseas alcoholic beverages mainly in North America, demand in the restaurant market recovered on relaxation of restrictions and increase in RTD also contributed to the i
Slide 5: Progress of the Growth Strategy
Progress of the Growth Strategy Alcoholic Beverages Food & Soft Drinks Japan alcoholic beverages Japan Continue to increase canned beer sales Expansion of sales for all lemon-based products Beer sales increased by 11% in total (lemon beverages + lemon food) Canned beer decreased by 4% due to drop in
Slide 6: Progress of Structural Reforms
Progress of Structural Reforms Alcoholic Beverages Food & Soft Drinks Japan alcoholic beverages Institute in-house production of RTD Reorganization of vending machine operator subsidiaries at Sendai Brewery and increase productivity at breweries Planning liquidation by 2022 Preparation to start RTD
Slide 7: Acquisition of Stone Brewing Co., LLC. ～Growth strategy for North America～
Acquisition of Stone Brewing Co., LLC. ～Growth strategy for North America～ Sapporo U.S.A., Inc., a consolidated subsidiary of Sapporo Holdings Ltd., has acquired membership interest(Consolidation) in Stone Brewing Co., LLC. <Purpose of this Acquisition> (1) Acquire manufacturing base for the Sapporo
Slide 8: Review of Medium-Term Management Plan
Review of Medium-Term Management Plan We are proceeding with Group Management Plan 2024 (2020 - 2024) under the “Sapporo Group Long-Term Management Vision ‘SPEED150’” that outlines the goals for the years up to 2026, the 150th anniversary of the Group’s founding. Concentrate on core Accelerate globa
Slide 9: Business Results
Business Results Copyright, 2022 SAPPORO HOLDINGS LTD. All rights reserved. 9/40
Slide 10: Financial Highlights
Financial Highlights 2021 Q2 2022 Q2 YoY changes YoY changes （billions of yen） Result Result (amount) (%) Revenue 199.7 213.8 14.1 7.1% Revenue（Excluding liquor tax） 151.1 162.4 11.3 7.5% Overseas revenue 34.7 43.1 8.4 24.3% EBITDA 6.9 7.9 0.9 13.4% Core operating profit (3.5) (2.2) 1.3 ー Core opera
Slide 11: Reasons for changes in sales revenue
Reasons for changes in sales revenue In addition to the growing sales of alcoholic beverages in North America, we saw strong sales for RTD and recovery in restaurant business demand after the easing of restrictions which resulted in increased earnings by billion yen (billions of yen) Alcoholic Bever
Slide 12: Reasons for changes in core operating profit
Reasons for changes in core operating profit Despite experiencing a decrease by 3 billion from the rising raw material costs, etc., revenue increased and structural reforms for the restaurant, and food and soft drink businesses had an effect, resulting in increase of core operating profit by billion
Slide 13: Recovery from COVID-19
Recovery from COVID-19 Relaxation of restrictions has led to recovery in commercial-use product sales volume for alcoholic beverages in Japan and revenue in restaurant business Alcoholic beverages (Japan): change in commercial-use product sales Restaurant business: change in sales at current stores
Slide 14: Alcoholic beverages in Japan
Alcoholic beverages in Japan Increase in revenue and profit attributed to the recovery in demand for restaurant business and strong sales for RTD despite upfront brand investment and more variable costs due to soaring raw material prices and fixed costs from Sendai Brewery depreciation, etc. This ha
Slide 15: Alcoholic beverages in overseas
Alcoholic beverages in overseas The demand recovery for restaurant business and steady sales with the expansion of SPB* home-use products led to an increase in revenue. Due to rising raw material costs, cost for acquiring of Stone Brewing Co. LLC, core operating profit remained flat year-on-year *SP
Slide 16: Alcoholic beverages in restaurants
Alcoholic beverages in restaurants The demand recovery for restaurant business and decrease in fixed costs from structural reforms led to an increase in core operating profit. ＜Revenue＞（billions of yen） ＜Core operating profit＞（billions of yen） 8.0 1 2021 2022 2021 2022 0.1 6.0 0 (0.9) (1.0) (1.1) 4.
Slide 17: Food & Soft Drinks
Food & Soft Drinks Revenue was down due to sale of café business and reorganization of vending machine operator subsidiaries while revenue increased the overseas Core operating profit showed improvement thanks to the structural reforms implemented last year ＜Revenue＞（billions of yen） ＜Core operating
Slide 18: Real Estate business
Real Estate business The sales of Yebisu First Square last year and decrease of rent over the renovation for YGP commercial complex* led to decrease in revenue and profit. ＜Revenue＞（billions of yen） ＜Core operating profit＞（billions of yen） 12.0 4.0 2021 2022 2021 2022 10.0 3.0 8.0 6.0 2.0 11.1 10.1
Slide 19: Profit attributable to owners of parent
Profit attributable to owners of parent 2021 Q2 2022 Q2 （billions of yen） Details Details Result Result Core operating Profit (3.5) (2.2) Other operating income 24.5 Gain on sales of fixed assets, etc. 3.1 Gain on sales of fixed assets, etc. Other operating expenses 1.9 1.2 Operating Profit 19.1 (0.
Slide 20: Group topics: discovery of barley that combines flavor and tolerance for climate change
Group topics: discovery of barley that combines flavor and tolerance for climate change (global warming, increased precipitation) In line with the Sustainable Policy, “With the earth, in harmony with society, from the start, to bring smiles to people,” the Sapporo Group identified and established su
Slide 21: Decrease in core operating profit caused by surge in raw material costs (full-year forecast)
Decrease in core operating profit caused by surge in raw material costs (full-year forecast) Results for the first half: down by 3.0 billion (1.5 billion in Japan, 1.5 billion in overseas) ⇒ implemented cost control measures Forecast for the second half: down by 4.0 billion (2.7 billion in Japan, 1.
Slide 22: Appendix
Appendix Copyright, 2022 SAPPORO HOLDINGS LTD. All rights reserved. 22/40
Slide 23: Appendix: Quarterly results for FY2022
Appendix: Quarterly results for FY2022 2021 Q1 2022 Q1 YoY changes YoY changes 2021 Q2 2022 Q2 YoY changes YoY changes （billions of yen） Result Result (amount) (%) Result Result (amount) (%) Revenue by Segment 89.9 93.2 3.4 3.7% 109.8 120.5 10.7 9.8% Alcoholic Beverages 56.6 60.6 3.9 6.9% 73.9 85.6
Slide 24: Appendix: Changes in Balance Sheets
Appendix：Changes in Balance Sheets Total assets declined 3.1 billions yen from the previous year end Total liabilities declined 6.1 billions yen from the previous year end and total capital increased 3.1 billions yen from the previous year end Total assets End of 2021 2022Q2 change Total liabilities
Slide 25: Appendix: Financial Status
Appendix： Financial Status Investment on a cash basis was ¥ billion ＜Consolidated cash flow (CF) statement＞ ＜ Investment total (①＋②＋③)> ¥ billion 2021 Q2 2022 Q2 （billions of yen） Change Change (%) ➀ Capital expenditure (cash basis): ¥ billion Result Result CF from operating activities 12.8 5.5 (7.3
Slide 26: Appendix: Initiatives for Sustainability Management
Appendix： Initiatives for Sustainability Management Sustainability management strategy The Sapporo Group will address global environmental and social issues to make people happy. The earth, the source of nature's bounty, is our most important partner. We will strive to collaborate and prosper togeth
Slide 27: Sapporo Group Environmental Vision 2050
Appendix: Initiatives for Sustainability Management Sapporo Group Environmental Vision 2050 Toward a “carbon-free society, recycling-oriented society and society in harmony with nature” Specific initiatives Carbon-free society ・Reduce CO2 of our own business sites by 20% (by 2030 vs. 2013) SB PS -Re
Slide 28: Appendix (Group topics): launch of official mobile app Uchi-repi
Appendix (Group topics): launch of official mobile app “Uchi-repi” This unique app enriches communication with your family to help households and create joy and happiness in cooking. ➢ Jointly developed with Fuller, Inc., this app is compatible with iOS/Android and was officially released on July 4t
Slide 29: Appendix: Major sales volume & sale
Appendix： Major sales volume & sale (Beer and beer-type beverages and non-alcoholic beer calculations based on large bottles,RTDs are calculated by 250 ml × 24 bottles.) Sales Volume:Beer (Japan) ※1 (10,000 cases) Sales:Beer (Japan) *including liquor tax (billions of yen) Jan 1 - Jun 30 Jan 1 - Jun
Slide 30: Appendix: Alcoholic Beverages (Japan)
Appendix：Alcoholic Beverages (Japan) <Domestic beer and beer-type beverages: <YoY changes in sales volume of beer and beer-type YoY change in sales volume by genre> beverages by genre> (Jan – Jun) （％） (cumulative for each month) [Beer and beer-type beverages total] up % YoY 120 110 ✓ Beer: up ％ y-o-
Slide 31: Appendix: Alcoholic Beverages (Japan)
Appendix：Alcoholic Beverages (Japan) ＜Main brand Jan- Jun Sales volume change＞ ＜ Beer lineup sales volume(Jan- Jun break down) ＞ (10,000 cases) 900 24% 800 700 600 500 23% 400 300 53% 200 100 Black Lable Yebisu Others 0 2015 2016 2017 2018 2019 2020 2021 2022 Black Lable brand total Yebisu brand tot
Slide 32: Appendix: Alcoholic Beverages (Japan)
Appendix：Alcoholic Beverages (Japan) ＜ Jan- Jun sales revenue ＞ ＜ Jan- Jun sales breakdown by category ＞ (billions of yen) ※Incl. liquor tax 10% 1% 100 7% 53% 90 28.9 Beer 31.8 33.3 25.2 21.0 Happoshu & New genre 80 8% Wine & Spirits 26.6 23.7 Japanese Liquor 70 26.0 RTD 60 Non-alcoholic beer 50 21%
Slide 33: Appendix: Alcoholic Beverages (Japan)
Appendix：Alcoholic Beverages (Japan) ＜ Jan- Jun sales revenue ＞ (billions of yen) *From 2021, Hyosai Sour and 99.99 keg are reclassified from Spirits to RTD. 0.5 0.8 0.9 0.7 3.4 3.6 3.7 3.5 3.6 2.8 3.2 10.2 10.3 2.7 0.8 0.7 7.9 7.6 0.6 0.6 2.5 2.4 2.4 2.3 2.1 3.1 3.9 1.7 1.6 1.6 2.0 2.4 2015 2016 20
Slide 34: Appendix: Alcoholic Beverages (Japan)
Appendix：Alcoholic Beverages (Japan) ＜Changes in the amount of liquor tax per 350 ml＞ （yen） 77 70 63.35 Beer ✓ Beer and Beer 54.25 Happoshu type beverages 46.99 yen New genre RTD 37.8 35 ✓ RTD 28 yen 2020 2023 2026 （year） Copyright, 2022 SAPPORO HOLDINGS LTD. All rights reserved. 34/40
Slide 35: Appendix: Alcoholic Beverages (Overseas)
Appendix：Alcoholic Beverages (Overseas) ＜Overseas beer : YoY change in sales volume＞ ＜ Overseas sales volume by brand (Jan-Jun) ＞ (Jan – Jun) （10,000 cases） 【North America Total up ％ y-o-y 1,000 ✓ Overseas brand 800 319 209 257 323 down ％ y-o-y 600 400 645 649 635 623 ✓ Sapporo brand 200 0 up ％ y-o-
Slide 36: Appendix: Alcoholic Beverages (Restaurants)
Appendix：Alcoholic Beverages (Restaurants) ＜ Sales revenue and number of Sapporo Lion Outlets ＞ ＜Sapporo Lion outlets As of June 30, 2022 ＞ (Billions of yen) ※before rebate deduction （Jan- Jun） 25.0 200 20.0 174 173 174 170 180 11 159 155 8 Tokyo Metroporitan 15.0 160 Kanto (excl. Tokyo) 10.0 140 13
Slide 37: Appendix: Food & Soft Drinks
Appendix：Food & Soft Drinks ＜ Japanese soft drinks POKKA SAPPORO Food & Beverage ＞ Sales volume & Sales by genre(Jan- Jun) ＜ Japanese soft drinks POKKA SAPPORO Food & Beverage ＞ Changes in sales volume for lemon beverages and lemon Food 【Lemon based-drinks】 【Lemon-based food products】 (the total vol
Slide 38: Appendix: Food & Soft Drinks
Appendix：Food & Soft Drinks ＜ Japanese soft drinks ＜ Food & Soft Drinks segment POKKA SAPPORO Food & Beverage ＞ Revenue break down by geographic area ＞ Sales composition by sales channel (Jan- Jun) ※Except connection adjustment 35% 80% 17.35 million Vending machine cases Retailer 20% 65% Japan Overs
Slide 39: Appendix: Real Estate
Appendix：Real Estate ＜ Information about Investment property ＞ ＜ Major rental properties & occupancy rates：（Averages for 2022 2Q )> (billions of yen) Occupa 400.0 Site area Floor area ncy rate No. of floors （㎡） （㎡） （%） 300.0 40 floors above ground, 200.0 408.1 Yebisu Garden Place（1） 56,943 298,007 8
Slide 40: As an intrinsic part of people's lives, Sapporo will contribute to the evolution of creative lifestyles
As an intrinsic part of people's lives, Sapporo will contribute to the evolution of creative, enriching and rewarding lifestyles. This document was prepared for the purpose of providing information to serve as a reference for investors in making investment decisions and not for the solicitation of i