Asahi Group Holdings Ltd · TSE:2502
Asahi — FY2021 Earnings Presentation
46 slides from Asahi's earnings presentation, Feb 16, 2022
Slide 1: Update of Medium- to Long-Term Management Policy
Update of Medium- to Long- Term Management Policy Business Overview for 2021 and Business Strategy for 2022 February 16, 2022
Slide 2: Executive Summary
Executive Summary Update of Medium- to Long-Term Management Policy ➢ Our Medium- to Long-Term Management Policy was formulated by backcasting from megatrends ➢ The policy is aimed at building a business portfolio that can respond to people’s changing conceptions of well-being, and further bolster co
Slide 3: Update of Medium- to Long-Term Management Policy
Update of Medium- to Long-Term Management Policy
Slide 4: Megatrend Analysis
Megatrend Analysis After analyzing megatrends through to the year 2050, we predict that conceptions about human well- being will change in the intervening years. By backcasting from 2050 and engaging in broad-ranging discussions we have identified the challenges the Asahi Group will need to tackle i
Slide 5: Medium- to Long-Term Management Policy: Overview of Long-Term Strategies
Medium- to Long-Term Management Policy: Overview of Long-Term Strategies Basic Concept behind Long-Term Strategies Contribute to sustainable society and respond to changing conceptions of wellbeing through delivering great taste and fun ⚫ Ideal Business Portfolio: Sustainable growth of existing busi
Slide 6: Ideal Medium- to Long-Term Business Portfolio
Ideal Medium- to Long-Term Business Portfolio Growth of existing businesses centered on beer category while expanding into new areas ⚫ Growth driven by global brands and premiumization in existing operating regions; expansion into new markets ⚫ Growth in adjacent categories to capture demand from tr
Slide 7: Integrating Sustainability into Management
Integrating Sustainability into Management Positioning “Our Promise for the Future” as the Asahi Group’s sustainability story To live up to this promise, we will continue to work on integrating sustainability into management through four key actions. Cheer the Future To invigorate our precious futur
Slide 8: Priority Policies and Themes of Sustainability Strategy
Priority Policies and Themes of Sustainability Strategy Realizing sustainable living for customers across the value chain We will address these themes across our value chain to make an impact in our business and society with our products and services. Respond to climate change Respond to plastic iss
Slide 9: Value Creation in Our Sustainability Strategy
Value Creation in Our Sustainability Strategy Seek to mitigate risks and secure opportunities in an effort to generate both positive business impacts and positive social impacts Respond to Respond to Realize Sustainable Solution of Social Climate Change Plastic Issue Communities Issues 2030 • Invigo
Slide 10: Digital Transformation Strategy
Digital Transformation Strategy Achieve innovation in three key areas (processes, organization, and business models) by pursuing BX (business transformation) through DX (digital transformation) Developing new business models, responding to changing conceptions of well-being, and creating mechanisms
Slide 11: R&D Strategy
R&D Strategy Increase the value of existing products and create new products and markets through bolstering R&D Creating new value to cater to Delivering physical and mental changing consumer values health to consumers • Researching alternatives to alcohol and • Providing evidence-based and products
Slide 12: Enhancement of Human Capital
Enhancement of Human Capital Advance human resource for executing core strategies and building an ideal business portfolio ⚫ Advancing diversity, equity, and inclusion to foster an ideal corporate culture and boost engagement ⚫ Continued nurturing of managers through systematic development programs
Slide 13: Key Medium-Term Strategies for Each Regional Headquarters
Key Medium-Term Strategies for Each Regional Headquarters 1. Expand the potential of the businesses through synergies and optimizing product portfolio to anticipate change. Japan 2. Promote smart-drinking and other initiatives to meet diversifying needs; create high-value-added services. 3. Solve so
Slide 14: Expansion of Global Brands
Expansion of Global Brands Pursuing premium brand strategies and driving sustainable growth in line with market trends through expansion and development of the 5 global brands Global Super Premium Heroes Scale Global Premium Tactical International Brands Priority super premium brands Premium brand t
Slide 15: Medium-Term Guidelines for KPIs
Medium-Term Guidelines for KPIs 2021 R e s u l t s Guidelines from 2022 for Next 3 Years Core Operating Profit JPY 217.9 billion ・CAGR: High single digit*1 Earnings Per Share (Adjusted*2) JPY 305.2 ・CAGR: High single digit Free Cash Flow*3 JPY 319.1 billion ・Annual average of JPY 200 billion or high
Slide 16: Medium-Term Guidelines for Financial Policy
Medium-Term Guidelines for Financial Policy Guidelines from 2022 Onward • Prioritize allocation of free cash flow to the reduction of debt and work to enhance capacity for growth investments Investment for Growth / Debt Reduction • Aim for Net Debt/EBITDA of around 3 times or less in 2024 (after ded
Slide 17: Restructuring of SCM in Japan
Restructuring of SCM in Japan
Slide 18: Restructuring of Supply Chain Management in Japan
Restructuring of Supply Chain Management in Japan (Alcohol and Non-alcohol Beverages Businesses) Building an optimal supply chain management system with initiatives spanning the Alcohol and Non-alcohol Beverages Businesses Production System for Beer, Beer-type 2022 2023 2024 2025 2026～ Beverages, an
Slide 19: Overview of Shin-Kyushu Brewery (tentative name)
Overview of Shin-Kyushu Brewery (tentative name) Operations scheduled to come online in 2026. Will feature next-generation production systems and operate as a model brewery for the Asahi Group Bolstering Environmental Responsiveness • Greater production range (expanded to 30 products from 10) • Capa
Slide 20: Business Overview for 2021 and Business Strategy for 2022
Business Overview for 2021 and Business Strategy for 2022
Slide 21: Revenue / Core Operating Profit (2021 Results)
Revenue / Core Operating Profit (2021 Results) (Constant Currency Basis*) (Actual Currency Basis) 2021 2021 (JPY billion) Change YoY vs Forecast Change YoY vs Forecast Results Results Alcohol Beverages Business 722.1 - 24.8 - 3.3% - 2.4 722.1 - 24.8 - 3.3% - 2.4 <Constant Currency Basis> Non-alcohol
Slide 22: Revenue / Core Operating Profit (2022 Forecast)
Revenue / Core Operating Profit (2022 Forecast) (Constant Currency Basis*) (Actual Currency Basis) (JPY billion) 2022 Change YoY 2022 Change YoY <Constant Currency Basis> Forecast Forecast Japan 1,331.6 112.2 9.2% 1,331.6 112.2 9.2% ➢ Revenue is expected to increase by 10.5% YoY due to a certain rec
Slide 23: Operating Profit / Profit Attributable to Owners of Parent
Operating Profit / Profit Attributable to Owners of Parent 2021 2022 (JPY billion) Results Change YoY vs Forecast Forecast Change YoY <2021 Results> Revenue 2,236.1 208.3 10.3% - 9.9 2,450.0 213.9 9.6% ➢ Operating profit increased by 56.8% YoY due Core Operating Profit 217.9 50.1 29.9% 3.9 240.0 22.
Slide 24: Statement of Financial Position / Statement of Cash Flow
Statement of Financial Position / Statement of Cash Flow <2021 Results> 2021 2022 (JPY billion) Results Change YoY vs Forecast Forecast Change YoY ➢ B/S: Total assets increased by JPY 108.4 billion from the end of the previous year Total assets 4,547.7 108.4 2.4% 73.7 4,500.0 - 47.7 - 1.0% mainly du
Slide 25: Sales Trend by Region
Sales Trend by Region Alcohol Beverages (Japan) 2021 Revenue: -4% YoY ・The on-premise market was sluggish in the January through March period *Value basis (Beer-type Beverages total) 40% due to declaration of further states of emergency in some regions. 30% ・Sales improved in April partly due to imp
Slide 26: Japan: Overview and Direction
Japan: Overview and Direction 2021 2022 Change YoY vs Forecast Change YoY (JPY billion) Results Forecast Revenue 1,205.8 - 18.0 - 1.5% - 2.5 1,331.6 112.2 9.2% Core OP 115.3 - 6.4 - 5.3% 0.5 111.4 7.9 7.6% <Overview for 2021> Alcohol Beverages Business: Strong marketing investment in core brands and
Slide 27: Japan (Alcohol Beverages Business): Beer Initiatives
Japan (Alcohol Beverages Business): Beer Initiatives Asahi Super Dry ・First full renewal in 36 years since launch ・Asahi Super Dry Nama Jokki Can production ・Sharp increase in buyers of canned Asahi Super Dry capacity boosted fourfold YoY (million) Source: Asahi estimates Asahi Nama Beer “Maru F” Re
Slide 28: Japan (Alcohol Beverages Business): Smart Drinking Initiatives
Japan (Alcohol Beverages Business): Smart Drinking Initiatives ⚫ Bolstering initiatives aimed at further expanding the Reference: newly created minimal alcohol market Estimated market Value of non-alcohol beer-taste beverages and minimal alcohol ・Enhancing communication aimed at people who do not, o
Slide 29: Japan (Non-alcohol Beverages Business): Main Initiatives
Japan (Non-alcohol Beverages Business): Main Initiatives ⚫ Carbonated soft drinks initiatives Record-high sales volume for both YoY (market) YoY (Asahi) Launching new refreshing products to cater to changing Mitsuya and Wilkinson 109% demand 110% 107% 2022 Forecast 103% ＋5.5％ (volume basis) Mitsuya
Slide 30: Japan (Food Business): Main Initiatives
Japan (Food Business): Main Initiatives ⚫ Initiatives aimed at a Mintia sales recovery ・Enhancing the product’s intrinsic value of instant refreshment ・Broadening product range to cater to new consumption scenarios ⚫ Creating new value in core categories as people embrace the “new normal” Ippon Manz
Slide 31: Europe: Overview and Direction
Europe: Overview and Direction 2021 2022 Change YoY vs Forecast Change YoY （JPY billion） Results Forecast Revenue 445.1 34.0 8.3% - 15.9 565.2 90.8 19.1% Core OP 70.8 10.5 17.4% 1.3 79.7 4.2 5.6% *constant currency basis (based on previous year's FX rates) <Overview for 2021> ⚫ The On Trade recovery
Slide 32: Europe: Overview and Main Initiatives
Europe: Overview and Main Initiatives （Khl／million Euro） 2021 YoY*2 Against Target*3 2022（E） YoY*2 ＜Overview by Channel＞ 2021 Sales Volume 41,262 2% -3% 44,812 9% Off-premise On-premise Total Net Sales (exc liquor tax) 2,936 9% -3% 3,446 18% YoY（volume basis）- low single digit +10-15% ＋2% Core OP*1
Slide 33: Sales Trend in Major Countries (Europe)
Sales Trend in Major Countries (Europe) 2021：Sales Volume -1％ 2021：Sales Volume -2％ Czech FY2019 ：On-premise Ratio approx.40％ Poland FY2019 ：On-premise Ratio Mid-single Digit ＜Status of On-premise Reopening＞ ＜Status of On-premise Reopening＞ May 17：Outdoor open May 15：Outdoor open May 31：Indoor open（
Slide 34: Oceania: Overview and Direction
Oceania: Overview and Direction 2021 2022 Change YoY vs Forecast Change YoY （JPY billion） Results Forecast Revenue 446.6 107.5 31.7% 1.9 532.5 32.5 6.5% Core OP 74.2 41.2 125.1% 0.1 98.0 15.0 18.0% *constant currency basis (based on previous year's FX rates) <Overview for 2021> ⚫ Strengthen our comp
Slide 35: Oceania: Overview and Main Initiatives
Oceania: Overview and Main Initiatives 2021 2022 (million AUD) Results YoY *3 vs Forecast Forecast YoY <Australian Alcohol Beverages: Overview by Channel> Alcohol Beverages *1 2,966 41% 0% 3,185 7% 2021 Results (YoY) Off-premise On-premise Total Non-alcohol Beverages *1 1,185 7% 1% 1,248 5% Sales Vo
Slide 36: Southeast Asia: Overview and Direction
Southeast Asia: Overview and Direction 2021 2022 Change YoY vs Forecast Change YoY (JPY billion) Results Forecast Revenue 40.9 - 0.7 - 1.7% 0.8 50.4 7.7 18.0% Core OP 0.4 - 1.0 - 71.6% 0.2 1.6 1.2 288.5% *constant currency basis (based on previous year's FX rates) <Overview for 2021> ⚫ Product mix i
Slide 37: Sustainability: Initiatives in Key Areas of Focus
Sustainability: Initiatives in Key Areas of Focus Respond to climate change Europe (Czechia) Oceania ・ Conclusion of a long-term green heat ・ Installation of Australia’s biggest supply contract for the Pilsner Urquell brewery solar project at the Yatala brewery Brewery in the state of Queensland ・ T
Slide 38: Sustainability: Initiatives in Key Areas of Focus
Sustainability: Initiatives in Key Areas of Focus Realize sustainable communities through the creation of people-to-people connections Europe (Czechia) Southeast Asia ・ The “For Hops” project to support hop ・ Vending machines being leased for free farmers kicked off in collaboration with for 3-month
Slide 39: Reference
Reference
Slide 40: Japan
Japan ＜2021 Results: Core Operating Profit＞ ➢ Alcohol Beverages: Profit declined by 14.7% 2021 2022 YoY due to the impact of lower sales and (JPY billiion) Change YoY vs Forecast Change YoY Results Forecast increased advertising and sales promotion Asahi Breweries Revenue 720.5 - 24.8 - 3.3% - 2.4 -
Slide 41: Japan (Alcohol Beverages: Revenue / Sales Volume)
Japan (Alcohol Beverages: Revenue / Sales Volume) ＜2021 Results＞ ➢ Beer-type beverages: Revenue (JPY billion) 2021 2022 *Before rebate deduction Change YoY vs Forecast Change YoY decreased by 4.0% YoY due to a Results Forecast decrease in demand for the on-premise Beer-type beverages 538.7 - 22.6 -
Slide 42: Japan (Alcohol Beverages: Details of Changes in Profit)
Japan (Alcohol Beverages: Details of Changes in Profit) 2021 2022 (JPY billion) Change YoY vs Forecast Change YoY Results Forecast Change in sales, category and container mix - - 1.7 - 1.0 - 34.3 Cost reduction in manufacturing - 2.8 0.0 - 1.3 Cost increase in manufacturing - - 2.6 0.0 - - 9.4 Adver
Slide 43: Japan (Non-alcohol Beverages: Sales Volume)
Japan (Non-alcohol Beverages: Sales Volume) 2021 2022 (Millions of cases) Change YoY vs Forecast Change YoY Results Forecast ＜2021 Results＞ Carbonated drinks 80.32 2.11 2.7% - 0.78 84.51 4.19 5.2% Lactic acid drinks 42.18 - 1.61 - 3.7% - 0.57 43.11 0.93 2.2% ➢ The market has recovered from COVID- Co
Slide 44: Japan (Non-alcohol Beverages: Details of Changes in Profit)
Japan (Non-alcohol Beverages: Details of Changes in Profit) 2021 2022 (JPY billion) Change YoY vs Forecast Change YoY Results Forecast Change in sales, category and container mix - 5.2 - 0.5 - 8.1 Cost reduction in manufacturing - 3.2 0.2 - 1.5 Cost increase in manufacturing - - 0.7 0.1 - - 6.9 Adve
Slide 45: (Reference) FX Impact
(Reference) FX Impact <FX Impact on P/L (Results and Forecast)> <Impact of 1 yen change (full year)> 2021 2022 (JPY billion) Assumption Revenue Core OP (JPY billion) Currrency Results Forecast Euro 128.5 ±4.3 ±0.6 Europe Euro 29.3 - 11.2 AUD 81.0 ±6.5 ±1.2 Oceania AUD 53.4 - 9.7 Southeast Asia - 1.8
Slide 46: Information in this material is not intended to solicit sale or purchase of shares
Information in this material is not intended to solicit sale or purchase of shares in Asahi Group Holdings. The views, estimates and other information expressed in this document are based on the company's judgment at the time of publication, and no guarantees are provided regarding the accuracy of s