Sapporo Holdings Limited · TSE:2501
Sapporo — FY2020 Earnings Presentation
50 slides from Sapporo's earnings presentation, Feb 12, 2021
Slide 1: Sapporo Group Business Results for 2020 / Management Plan for 2021
Sapporo Group Business Results for 2020 Management Plan for 2021 *In this document, the following company name abbreviations are used: February 12th 2021 SH: Sapporo Holdings Limited SB: Sapporo Breweries Ltd. SLN: Sapporo Lion, Inc. URL https://www.sapporoholdings.jp/en/ PS: Pokka Sapporo Food & Be
Slide 2: 1. Management Plan for 2021 2. Business Results for 2020 3. Appendix
1. Management Plan for 2021 ・・・P3~P18 2. Business Results for 2020 ・・・P19~P36 3. Appendix ・・・P37~P50 Copyright, 2021 SAPPORO HOLDINGS LTD. All rights reserved. 2/50
Slide 3: 2021 Management Plan
2021 Management Plan Copyright, 2021 SAPPORO HOLDINGS LTD. All rights reserved. 3/50
Slide 4: Medium-Term Direction
Medium-Term Direction While the COVID-19 pandemic has changed the market environment significantly, there has been no change to Sapporo Group’s medium-term direction Meanwhile, to achieve targets it is important to achieve results early on We will accelerate our efforts more than ever ◆ Group Manage
Slide 5: 2020 in Review
2020 in Review In 2020, all businesses struggled due to the impact of COVID-19. In particular, Restaurants and Food & Soft Drinks suffered major declines in sales and profits Food & Soft Drinks posted impairment of property, plant and equipment as profitability fell ◆ Overview and topics Business Ov
Slide 6: 2021: Policy for Initiatives
2021: Policy for Initiatives In 2021, a gradual market recovery is expected, as COVID-19 vaccinations commence. Sapporo Group will focus especially on the initiatives below and aim for business growth and improvement in efficiency of invested capital ◆ Main growth strategies and initiatives for refo
Slide 7: 2021: Growth Strategy
2021: Growth Strategy [Japanese Alcoholic Beverages] Pursue both “premium value” and “reasonable value” Total demand ◆ Total beer demand outlook 2021 sales plan (cases) outlook SH estimate (10,000 cases) Plan YoY vs 2019 YoY vs 2019 <Beer and beer-type beverages> ・Though expecting recovery in Japane
Slide 8: 2021: Growth Strategy
2021: Growth Strategy [Japanese Alcoholic Beverages] Pursue both “premium value” and “reasonable value” ◆ “Premium value”: Premiumization of beer products ◆ “Reasonable value”: enhance drinking time at home on ordinary days <Black Label> Drinking at home Drinking outside <New genre> Sales volume Can
Slide 9: 2021: Growth Strategy
2021: Growth Strategy [Overseas Alcoholic Beverages] In Canada, strengthen RTDs in addition to beer. In the U.S., work on strengthening home-use products and revival of Anchor 2021 sales plan (cases) ◆ Canada <Beer> ＜RTD＞ (10,000 cases) Plan YoY vs 2019 International beer and beer-type beverages 1,9
Slide 10: 2021: Growth Strategy
2021: Growth Strategy [Restaurants] Focus on low-cost, low-operation [Food & Soft Drinks] business format Focus on plant-based ingredients *PS 2021 sales plan（value) alone 2021 sales plan（value) (billion yen) Plan YoY vs 2019 (billion yen) Plan YoY vs 2019 Restaurants 16.7 +48% (39%) Soft drinks 63.
Slide 11: 2021: Growth Strategy
2021: Growth Strategy [Real Estate] Expand the scale of business through strategic reshuffling of properties, re-investment ◆ Refurbishment of the commercial wing of ◆ Expand business in new business domains Yebisu Garden Place Museum of Yebisu Garden YEBISU BEER Place Tower Image ➡Spring 2022: adva
Slide 12: 2021: Reform of Corporate Structure
2021: Reform of Corporate Structure Improve profitability and balance sheet efficiency to enhance efficiency of invested capital Plan to carry out strategic reshuffling of properties in 2021 also ➡Realize unrealized capital gains and reinvest proceeds to strengthen Reshuffling of properties capital
Slide 13: 2021: Group Management Plan
2021: Group Management Plan 2020 2021 YoY changes YoY changes （billions of yen） Result Plan (amount) (%) Revenue 434.7 7.7% Revenue（Excluding liquor tax） 328.6 354.1 25.5 7.8% Overseas revenue 65.5 72.7 7.2 11.0% EBITDA 27.4 29.4 2.0 7.5% Core operating profit 4.3 111.2% Core operating profit margin
Slide 14: 2021: Revenue Plan by Segment
2021: Revenue Plan by Segment 2020 2021 YoY changes YoY changes （billions of yen） Result Plan (amount) (%) Revenue by Segment 434.7 7.7% Alcoholic Beverages 285.4 8.9% Japanese 227.9 245.3 17.4 7.6% Overseas 46.2 49.0 2.7 5.9% Restaurants 11.3 16.7 5.4 47.7% Food & Soft Drinks 125.9 6.3% Real Estate
Slide 15: 2021: Main Factors Contributing to Changes in Revenue
2021: Main Factors Contributing to Changes in Revenue Revenue to increase primarily as the beer and restaurant businesses recover and new genre and RTDs grow = Increase Alcoholic Beverages Food & Soft Drinks Real Estate = Decrease 2021 plan Japanese liquor Beer +5.3 +2.0 Wine, western Happoshu (1.2)
Slide 16: 2021: Core Operating Profit Plan by Segment
2021: Core Operating Profit Plan by Segment 2020 2021 YoY changes YoY changes （billions of yen） Result Plan (amount) (%) Core Operating Profit by Segment 4.3 111.2% Alcoholic Beverages 2.4 208.2% Japanese 6.7 7.2 0.5 7.8% Overseas 0.5 1.7 1.3 273.4% Restaurants (5.0) (1.6) 3.4 ー Food & Soft Drinks (
Slide 17: 2021: Main Factors Contributing to Changes in Core Operating Profit
2021: Main Factors Contributing to Changes in Core Operating Profit Core operating profit of Real Estate temporarily declined due to a fall in office occupancy rate but it was covered by increases in Alcohol Beverages and Food & Soft Drinks. = Increase Alcoholic Beverages Food & Soft Drinks Real Est
Slide 18: 2021: Profit attributable to owners of parent
2021: Profit attributable to owners of parent 2020 （Details） 2021 （billions of yen） （Details） Result Plan Core operating Profit 4.3 Impairment at PS (11.0) Other operating Loss from COVID-19 (3.5) Proceeds from sale of real income, expenses (20.2) Early retirement program 9.0 estate, etc. lump sum p
Slide 19: Business Result
Business Result Copyright, 2021 SAPPORO HOLDINGS LTD. All rights reserved. 19/50
Slide 20: 2020: Result
2020: Result Strengthening of the core beer brands continued; new genre grew with GOLD STAR becoming a hit Sleeman, with strengths in home-use products, exceeded the previous year’s level Lemon-based products and food were also strong Black Label brand canned YEBISU brand canned product product sale
Slide 21: 2020: Issues
2020: Issues Commercial-use beer, sales at restaurants, and vending machine sales declined significantly due to impact of COVID-19 RTDs faced uphill battle as 99.99 had sluggish growth despite significant growth for Otoko Ume Sour Beer (bottles・kegs） RTD Sapporo Lion sales volume Sales sales Down %
Slide 22: 2020: Highlights
2020: Highlights 2019 2020 YoY changes YoY changes （billions of yen） Result Result (amount) (%) Revenue 491.9 (11.6%) Revenue（Excluding liquor tax） 371.1 328.6 (42.5) (11.5%) Overseas revenue 71.2 65.5 (5.7) (8.0%) EBITDA 36.0 27.4 (8.6) (24.0%) Core operating profit 11.7 (63.7%) Core operating prof
Slide 23: 2020: Highlights
2020: Highlights While business performance is on a gradual recovery trend along with the recovery in the market, it continued to underperform 2019 levels Revenue Core operating profit Profit attributable to owners of parent (billions of yen) (billions of yen) (billions of yen) (1.4) (17.4) (11.5) 8
Slide 24: 2020: Highlights
2020: Highlights Profit declined overall, but core operating profit of businesses other than restaurant-related business at similar level to previous year ◆ Breakdown showing core operating profit for restaurants and other businesses (billions of yen) (0.1) 12 （-1%） <Consolidated: ➀＋② > <Excl. resta
Slide 25: 2020: Highlights
2020: Highlights Balance of net debt Equity Capital expenditure (cash basis) 2019 2019 2019 212.1 221.5 174.5 2020 29.9 2020 2020 149.6 16.1 （billions of yen） （billions of yen） （billions of yen） Transformation of the Group Group Topics management platform <October–December> <October–December> ➢ Regi
Slide 26: 2020: Revenue by Segment
2020: Revenue by Segment 2019 2020 YoY changes YoY changes （billions of yen） Result Result (amount) (%) Revenue by Segment 491.9 (11.6%) Alcoholic Beverages 330.2 (13.6%) Japan & Asia 254.7 228.4 (26.2) (10.3%) North America 48.3 45.7 (2.5) (5.3%) Restaurants 27.3 11.3 (16.0) (58.6%) Food & Soft Dri
Slide 27: 2020: Main Factors Contributing to Changes in Revenue
2020: Main Factors Contributing to Changes in Revenue Revenue declined significantly overall, despite sales increases in new genre and Japanese liquors and contribution from Yasuma consolidation Alcoholic Beverage Food & Soft Drinks 2019 YoY difference result Real Estate Total １Q ２Q 3Q 4Q Japanese l
Slide 28: 2020: Core Operating Profit by Segment
2020: Core Operating Profit by Segment 2019 2020 YoY changes YoY changes （billions of yen） Result Result (amount) (%) Core Operating Profit by Segment 11.7 (63.7%) Alcoholic Beverages 8.5 (72.2%) Japan & Asia 8.0 7.0 (1.0) (12.0%) North America 0.2 0.3 0.1 51.5% Restaurants 0.4 (5.0) (5.4) ー Food &
Slide 29: 2020: Main Factors Contributing to Changes in Core Operating Profit
2020: Main Factors Contributing to Changes in Core Operating Profit Both revenue and profits declined: cost control primarily of sales promotion costs offset the impact of declines in commercial-use beer and soft drinks, but it was not enough to cover the impact of the restaurant-related revenue dec
Slide 30: 2020: Profit attributable to owners of parent
2020: Profit attributable to owners of parent 2019 （Details） 2020 （billions of yen） （Details） Result Result Core operating Profit 11.7 Other operating Proceeds from sale of real Proceeds from sale of real income 3.5 estate +1.9 3.7 estate +1.5 Impairment at PS (11.0) Loss Other operating from COVID-
Slide 31: 2020: Alcoholic Beverages
2020: Alcoholic Beverages Commercial-use beer and restaurant business struggled due to the impact of COVID-19; home-use beer and new genre performed strongly <Revenue> (billions of yen) 100 (13.7) (8.8) Positive ➢ Beer (canned), new genre exceeded 2019 levels (19.3) （-15%） （-10%） （-22%） ➢ Otoko Ume
Slide 32: 2020: Food & Soft Drinks
2020: Food & Soft Drinks Cafés and vending machine soft drink sales struggled due to impact of COVID-19; lemon-related products and food products were strong due to stay-at-home demand <Revenue> (3.4) (2.2) Positive (billions of yen) 40 (7.2) （-9%） （-6%） +1.8 （-21%） ➢ Record shipments of Pokka Lemon
Slide 33: 2020: Real Estate
2020: Real Estate Commercial facilities struggled, but offices sustained high occupancy rates; business results trending solidly <Revenue> 8 Positive (billions of yen) (0.0) (0.3) (0.6) (0.6) （-5%） （-9%） ➢ Maintained high occupancy rates at offices and rental （-0%） （-9%） 6 apartment buildings 4 6.3
Slide 34: 2020: Changes in Balance Sheets
2020: Changes in Balance Sheets Total assets declined 22.4 billions yen YoY Total assets Total assets Cash and cash equivalents Trade receivables 15.2 19.7 Current assets 92.5 Change 84.5 +5.1 Inventories 36.5 36.0 11.5 20.6 Other current assets 155.9 ➢ Increase in income taxes receivable 135.7 Fixe
Slide 35: 2020: Changes in Balance Sheets
2020: Changes in Balance Sheets Total liabilities increased 2.6 billions yen YoY and total capital declined 25.0 billions yen YoY Total liabilities and Total liabilities and equity equity Trade payables Short-term financial liabilities 34.5 31.9 ➢ Increase in bond redemption amount for 2021 72.1 Cur
Slide 36: 2020: Financial Status
2020: Financial Status Investment on a cash basis was ¥ billion <Consolidated cash flow (CF) statement> <Investment total (①＋②＋③)> ¥ billion (billions of yen) 2019 2020 Change Change (%) CF from operating activities 36.1 16.5 (19.6) (54.3%) ➀ Capital expenditure (cash basis): ¥ billion (Property, pl
Slide 37: Appendix
Appendix Copyright, 2021 SAPPORO HOLDINGS LTD. All rights reserved. 37/50
Slide 38: Appendix: Sustainability Management Initiatives
Appendix: Sustainability Management Initiatives Main topics for 2020 ➢ Fukushima Prefecture, SH, and SB sign comprehensive partnership agreement https://www.sapporoholdings.jp/news/dit/?id=8564 ➢ Sapporo Group companies recognized under the 2020 Certified Health & Productivity Management Outstanding
Slide 39: Appendix: Major sales volume & sale
Appendix： Major sales volume & sale Sales:Beer (Japan) *including liquor tax (billions of yen) Sales Volume:Beer (Japan) ※1 (10,000 cases) YoY Fiscal 2019 Fiscal 2020 Change(%) YoY Fiscal 2019 Fiscal 2020 Beer 167.4 137.2 (18.0%) Change(%) Happoshu 8.1 6.8 (16.2%) Sapporo Draft Beer Black Label (tot
Slide 40: 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 – Dec) （％） (cumulative for each month) [Beer and beer-type beverages total] down % YoY 200 175 ✓ Beer: down ％
Slide 41: Appendix: Alcoholic Beverages (Japan)
Appendix：Alcoholic Beverages (Japan) ＜Main brand Jan- Dec Sales volume change＞ ＜ Beer lineup sales volume (Jan- Dec break down) ＞ (10,000 cases) 2,000 1,800 17% 1,600 1,400 1,200 29% 1,000 800 600 54% 400 200 Black Label YEBISU Others 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Black La
Slide 42: Appendix: Alcoholic Beverages (Japan)
Appendix：Alcoholic Beverages (Japan) ＜ Jan- Dec sales revenue ＞ ＜ Jan- Dec sales breakdown by category ＞ (billions of yen) ※Incl. liquor tax 250.0 6% 1% 6% 200.0 79.3 65.0 59.5 70.6 50.1 45.5 57% Beer 52.2 8% Happoshu & New genre 150.0 Wine & Spirits Japanese liquor 100.0 RTD 167.2 171.0 165.8 167.4
Slide 43: Appendix: Alcoholic Beverages (Japan)
Appendix：Alcoholic Beverages (Japan) ＜ Jan- Dec sales revenue ＞ (billions of yen) 4.3 8.3 8.2 8.5 8.5 8.2 6.8 15.2 13.7 11.8 8.4 5.6 5.3 5.0 5.1 4.7 7.0 3.6 4.5 4.3 5.1 2014 2015 2016 2017 2018 2019 2020 2014 2015 2016 2017 2018 2019 2020 Japanese Wine Imported Wine ＲＴＤ 10.0 9.1 15.8 16.4 8.7 14.7 1
Slide 44: 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, 2021 SAPPORO HOLDINGS LTD. All rights reserved. 44/50
Slide 45: Appendix: Alcoholic Beverages (Overseas)
Appendix：Alcoholic Beverages (Overseas) ＜Overseas beer : YoY change in sales volume＞ ＜ Overseas sales volume by brand(Jan-Dec) ＞ （10,000cases） 【North America Total down % y-o-y 1,800 (Jan – Dec) 596 464 ✓ Overseas brand 1,500 1,200 up ％ y-o-y 900 600 1,323 1,359 ✓ Sapporo brand 300 0 down ％ y-o-y 20
Slide 46: Appendix: Alcoholic Beverages (Restaurants)
Appendix：Alcoholic Beverages (Restaurants) ＜ Sales revenue and number of Sapporo Lion Outlets ＞ ＜Sapporo Lion outlets As of Dec 31, 2020 ＞ (Billions of yen) ※before rebate deduction （Jan- Dec） 200 24.0 185 170 175 170 169 180 11 20.0 161 9 Tokyo Metroporitan 16.0 160 Kanto (excl.Tokyo) 12.0 25.1 24.
Slide 47: Appendix: Food & Soft Drinks
Appendix：Food & Soft Drinks ＜ Japanese soft drinks ＜ Japanese soft drinks POKKA SAPPORO Food & Beverage ＞ POKKA SAPPORO Food & Beverage ＞ Sales volume & Sales by genre(Jan- Dec) Sales composition by sales channel (Jan- Dec) 【Lemon based-drinks】 【Lemon-based food products】 40% ✓ up ％ y-o-y ✓ up ％ y-o
Slide 48: Appendix: Food & Soft Drinks
Appendix：Food & Soft Drinks ＜ Food & Soft Drinks segment Revenue break down by geographic area ＞ 【 Pokka Create Co., Ltd .】 ※Except connection adjustment ✓ Jan- Dec Sales revenue billion down ％ y-o-y 86% ＜ Number of outlets as of Dec 31, 2020> 112 14% 58 East Japan 208 outlets Central Japan West Jap
Slide 49: Appendix: Real Estate
Appendix：Real Estate ＜ Information about ＜ Major rental properties & occupancy rates：（Averages for 2020 )> Investment property ＞ (billions of yen) ※ Fair value information is updated in 1Q 2021 Occupa 400.0 Site area Floor area ncy rate No. of floors （㎡） （㎡） （%） 300.0 40 floors above ground, Yebisu
Slide 50: As an intrinsic part of people's lives, Sapporo will contribute to evolution
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