Sapporo Holdings Limited · TSE:2501

Sapporo — H1 2020 Earnings Presentation

41 slides from Sapporo's earnings presentation, Aug 7, 2020

  1. Slide 1: Sapporo Group Business Results Presentation for the Six Months Ended June 30, 2020

    Sapporo Group Business Results Presentation for the Six Months Ended June 30, 2020 August 7th 2020 URL https://www.sapporoholdings.jp/en/ Copyright, 2020 SAPPORO HOLDINGS LTD. All rights reserved. 1/41

  2. Slide 2: Agenda

    １． Management plan ・・・P3~P6 ２． Revision of Consolidated Earnings Forecasts ・・・P7~P11 ３． Business Results ・・・P12~P28 ４． Appendix ・・・P29~P41 Copyright, 2020 SAPPORO HOLDINGS LTD. All rights reserved. 2/41

  3. Slide 3: Management Plan

    Management Plan Copyright, 2020 SAPPORO HOLDINGS LTD. All rights reserved. 3/41

  4. Slide 4: Full-Year Earnings Forecast 2020 and Response to the Novel Coronavirus Outbreak

    Full-Year Earnings Forecast 2020 and Response to the Novel Coronavirus Outbreak Revision of consolidated earnings forecast 2020（refer to page 7） 2020 ＜Earnings forecast＞ （billion of yen） Revised 2019 YoY changes 2020 Revised (amount) First Plan Amount Plan Revenue 444.5 491.9 (47.4) 504.4 (59.9) Cor

  5. Slide 5: Medium-term management plan 2024

    Medium-term management plan 2024 No change in Medium-term management plan 2024(Basic Policy, Financial goals, Financial policy) ・Basic Policy ・ Financial goals Achieve ¥30 billion core operating profit in 2024 <Key indicators> Focus on core business 2% or more Revenue growth rate and build resilienc

  6. Slide 6: Medium-term Management Plan: Group Management Plan 2024

    Medium-term Management Plan: Group Management Plan 2024 Clarify “initiatives for businesses whose earnings will significantly decline”, “initiatives for further accelerating growth”, and “direction for new initiatives”, and work on them with increased speed -Initiatives for businesses whose earnings

  7. Slide 7: Revision of Consolidated Earnings Forecasts

    Revision of Consolidated Earnings Forecasts Copyright, 2020 SAPPORO HOLDINGS LTD. All rights reserved. 7/41

  8. Slide 8: Revenue target

    Revenue target 2020 YoY changes （billions of yen） 2019 YoY changes (%) Revised Plan (amount) Revenue by Segment 491.9 444.5 (9.6%) Alcoholic Beverages 330.2 286.9 (13.1%) Japan & Asia 254.7 229.4 (25.3) (9.9%) North America 48.3 44.9 (3.4) (7.0%) Restaurants 27.3 12.7 (14.6) (53.4%) Food & Soft Drin

  9. Slide 9: Core Operating Profit target

    Core Operating Profit target 2020 YoY changes YoY changes （billions of yen） 2019 Revised Plan (amount) (%) Core Operating Profit by Segment 11.7 1.0 (91.5%) Alcoholic Beverages 8.5 (0.4) ｰ Japan & Asia 8.0 4.5 (3.5) (43.8%) North America 0.2 0.0 (0.2) (100.0%) Restaurants 0.4 (4.9) (5.3) ｰ Food & So

  10. Slide 10: Profit attributable to owners of parent target

    Profit attributable to owners of parent target 2020 （billions of yen） 2019 Details Details Revised Plan Core operating Profit 11.7 Other operating Proceeds from sale of income 3.5 Yebisu Square +1.9 3.0 Other operating Early Retirement Incentive Program expenses 3.0 11.9 Coronavirus losses 3.4 Opera

  11. Slide 11: Details of sales volume & Sales

    Details of sales volume & Sales Forecast of Sales Volume & Sales (Alcoholic Beverages, Restaurant , Food & Soft Drinks)Y-o-Y Sales have been recovering moderately, but negative effects will continue. Sales Volume & Sales（Y-o-Y） 2020 Details Jul-Sep Oct-Dec total Jun-Mar Apr-Jun Forecast Forecast For

  12. Slide 12: Business Results

    Business Results Copyright, 2020 SAPPORO HOLDINGS LTD. All rights reserved. 12/41

  13. Slide 13: Review for the Six Months Ended June 30, 2020 [Results]

    Review for the Six Months Ended June 30, 2020 [Results] Home consumption products capturing stay-at-home demand and performing strongly Lemon-based products also strong reflecting rising health consciousness Black Label brand canned Yebisu brand canned product sales volume New genre sales volume Jap

  14. Slide 14: Review for the Six Months Ended June 30, 2020 [Issues]

    Review for the Six Months Ended June 30, 2020 [Issues] The COVID-19 crisis has had a significant impact on the restaurant business, commercial-use product businesses, and the soft drink vending machine business While the RTD market has grown overall, our 99.99 products are growing slowly and struggl

  15. Slide 15: Results Highlight

    Results Highlight 2019 2020 YoY changes YoY changes （billions of yen） 2Q 2Q (amount) (%) Revenue 228.2 (12.4%) Revenue（Excluding liquor tax） 173.0 151.6 (21.4) (12.4%) Overseas revenue 35.2 30.7 (4.5) (12.9%) EBITDA 10.7 6.4 (4.3) (40.6%) Core operating profit (1.3) - Core operating profit margin (0

  16. Slide 16: Results Highlight

    Results Highlight The impact of the novel coronavirus outbreak became full blown in the second quarter; overall revenue and profit declined significantly Revenue YoY changes Core Operating YoY changes Profit attributable to YoY changes Profit owners of parent 228.2 (1.3) (5.1) (0.8) (6.4) 200.0 2019

  17. Slide 17: Results Highlight

    Results Highlight Balance of net debt Equity Capital expenditure (cash basis) End of 2019 2019Q2 End of 2019 212.1 225.8 2020Q2 174.5 156.6 2020Q2 20.0 2020Q2 10.6 （billions of yen） （billions of yen） （billions of yen） Transformation of the Group Group Topics management platform <April-June> <April-J

  18. Slide 18: Revenue by Segment

    Revenue by Segment YoY changes YoY changes （billions of yen） 2019 2Q 2020 2Q (amount) (%) Revenue by Segment 228.2 (12.4%) Alcoholic Beverages 152.6 (14.6%) Japan & Asia 116.4 103.4 (13.0) (11.2%) North America 23.3 21.5 (1.8) (7.9%) Restaurants 12.9 5.5 (7.4) (57.3%) Food & Soft Drinks 63.5 (8.5%)

  19. Slide 19: Main Factors Contributing to Changes in Revenue

    Main Factors Contributing to Changes in Revenue Revenue declined ¥ billion YoY as revenue from beer, restaurants, and soft drinks fell, = Increase despite growth of new genre sales and contribution from Yasuma consolidation = Decrease (billions of yen) 2019 Alcoholic Beverages Food & Soft Drinks Rea

  20. Slide 20: Core Operating Profit by Segment

    Core Operating Profit by Segment YoY changes YoY changes （billions of yen） 2019 2Q 2020 2Q (amount) (%) Core Operating Profit by Segment (1.3) - Alcoholic Beverages (0.6) - Japan & Asia 0.3 (0.8) (1.1) - North America (0.5) (0.6) (0.1) - Restaurants (0.4) (2.5) (2.1) - Food & Soft Drinks (1.6) - Rea

  21. Slide 21: Main Factors Contributing to Changes in Core Operating Profit

    Main Factors Contributing to Changes in Core Operating Profit Core operating profit declined ¥ billion YoY, as strong performance of Real Estate and = Increase efforts to reduce fixed costs at Alcoholic Beverages and Food & Soft Drinks were insufficient to offset the decline in revenue = Decrease (b

  22. Slide 22: Profit attributable to owners of parent

    Profit attributable to owners of parent （billions of yen） 2019 2Q （Details） 2020 2Q （Details） Core operating Profit (1.3) Other operating Proceeds from sale of income 2.9 Yebisu Square +1.9 0.6 Other operating 1.4 5.0 Coronavirus losses 3.4 expenses Operating Profit 0.1 (9.4) Profit before tax (0.3)

  23. Slide 23: Alcoholic Beverages

    Alcoholic Beverages Revenue and profit declined due to slump in commercial-use products and restaurant business, despite strength of products for home consumption thanks to stay-at-home demand <Revenue> 100 Positive ➢ Black Label brand canned products continued to (billions of yen) 1000 (19.3) (-22.

  24. Slide 24: Food & Soft Drinks

    Food & Soft Drinks Revenue and core operating profit declined reflecting sluggish vending machine soft drink sales and slump in restaurants, despite strong performance of lemon-based products and food products <Revenue> 400 40 (7.2) Positive (billions of yen) +1.8 (-20.7%) ➢ Lemon-based products wer

  25. Slide 25: Real Estate

    Real Estate While Sapporo Factory struggled, Yebisu Garden Place remained solid <Revenue> 8 80 Positive (billions of yen) (0.0) (-0.2%) (0.6) ➢ Offices and rental housing maintained high 6 60 (-9.3%) occupancy rates 4 40 6.1 6.1 6.0 6.3 6.4 5.4 20 2 ➢ Impact of COVID-19 crisis on some commercial 0 J

  26. Slide 26: Changes in Balance Sheets

    Changes in Balance Sheets Total assets decreased ¥22.0 billion year on year Total assets Total assets 現預金 Cash and cash equivalents (billions of yen) ➢ Increased cash reserves as novel coronavirus countermeasure 営業債権 Trade receivables 15.2 23.8 Current assets ➢ Seasonal factors 92.5 67.1 YoY change

  27. Slide 27: Changes in Balance Sheets

    Changes in Balance Sheets Total liabilities declined ¥4.1 billion from year end, total equity fell ¥17.9 billion Total liabilities and Total liabilities and 営業債務 Trade payables equity equity (billions of yen) 短期金融負債 Short-term financial liabilities 34.5 32.1 ➢ To procure cash reserves 72.1 流動負債その他 O

  28. Slide 28: Financial Status

    Financial Status Investment on a cash basis was ¥ billion <Consolidated cash flow (CF) statement> <Investment total (①+②+③)> ¥ 2019 2020 billion (billions of yen) Change Change (%) 2Q results 2Q results CF from operating ➀ Capital expenditure (cash basis) : ¥ billion activities 13.6 4.3 (9.3) (68.3)

  29. Slide 29: Appendix

    Appendix Copyright, 2020 SAPPORO HOLDINGS LTD. All rights reserved. 29/41

  30. Slide 30: Appendix: Major sales volume & sale

    Appendix： Major sales volume & sale Sales Volume:Beer (Japan) ※1 (10,000 cases) Year ending Jan. 1 - Jan. 1 - Change Change(%) December 31, Change Change(%) Jun.30, 2019 Jun.30, 2020 2020 (Forecast) Sapporo Draft Beer Black Label (total) 778 600 (178) (22.9%) 1,380 (287) (17.2%) YEBISU (total) 353 2

  31. Slide 31: 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) 200 [Beer and beer-type beverages total] down % YoY Beer 175 ✓ Beer: do

  32. Slide 32: Appendix: Alcoholic Beverages (Japan)

    Appendix：Alcoholic Beverages (Japan) ＜Main brand Jan- Jun Sales volume change＞ ＜ Beer lineup (Jan- Jun break down) ＞ (10,000 cases) 900 800 15% 700 600 27% 500 400 58% 300 200 100 Black label Yebisu Other 0 2014 2015 2016 2017 2018 2019 2020 Black label brand total Yebisu brand total Mugi to hop bra

  33. Slide 33: Appendix: Alcoholic Beverages (Japan)

    Appendix：Alcoholic Beverages (Japan) ＜ Jan- Jun sales revenue ＞ ＜ Jan- Jun sales breakdown by category ＞ (billions of yen) ※Incl. liquor tax 120.0 100.0 7% 6% 1% Beer 31.8 28.9 54% 38.4 33.3 21.0 Happoshu & New genre 25.2 80.0 26.6 8% Wine & Spirits 60.0 Japanese liquor RTD 40.0 76.3 72.1 71.5 74.4

  34. Slide 34: Appendix: Alcoholic Beverages (Japan)

    Appendix：Alcoholic Beverages (Japan) ＜ Jan- Jun sales revenue ＞ (billions of yen) 3.5 3.4 3.6 3.7 3.5 3.6 7.9 2.8 6.9 2.7 3.9 2.5 2.4 2.4 2.3 2.1 3.1 1.7 2.3 2.0 2.4 2014 2015 2016 2017 2018 2019 2020 2014 2015 2016 2017 2018 2019 2020 Japanese Wine Imported Wine ＲＴＤ 4.5 3.9 4.0 7.6 7.8 7.9 3.0 3.4

  35. Slide 35: 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, 2020 SAPPORO HOLDINGS LTD. All rights reserved. 35/41

  36. Slide 36: Appendix: Alcoholic Beverages (Overseas)

    Appendix：Alcoholic Beverages (Overseas) ＜Overseas beer : YoY change in sales volume＞ ＜ Overseas sales volume by brand(Jan-Jun) ＞ （10,000cases） 【North America Total down % y-o-y 1,200 (Jan – Jun) ✓ Overseas brand 900 319 209 up ％ y-o-y 600 300 645 649 ✓ Sapporo brand 0 down ％ y-o-y 2019 2020 Overseas

  37. Slide 37: Appendix: Alcoholic Beverages (Restaurants)

    Appendix：Alcoholic Beverages (Restaurants) ＜ Sales revenue and number of Sapporo Lion Outlets ＞ ＜Sapporo Lion outlets As of Jun 30, 2020 ＞ (Billions of yen) ※before rebate deduction （Jan- Jun） 12.0 200 183 10 11 180 9.0 174 173 174 Tokyo Metroporitan 170 14 159 155 160 Kanto (excl. Tokyo) 6.0 11.8 1

  38. Slide 38: 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- Jun) Sales composition by sales channel (Jan- Jun) 【Lemon based-drinks】 【Lemon-based food products】 40% ✓ up ％ y-o-y ✓ up ％ y-o

  39. Slide 39: Appendix: Food & Soft Drinks

    Appendix：Food & Soft Drinks ＜ Food & Soft Drinks segment Revenue break down by geographic area ＞ 【 Pokka Create Co., Ltd .】 ✓ Jan- Jun Sales revenue billion 86% down ％ y-o-y ＜ Number of outlets as of June 30, 2020> 114 14% 59 East Japan 210 outlets Central Japan Japan Overseas West Japan ＜Japanese s

  40. Slide 40: Appendix: Real Estate

    Appendix：Real Estate ＜ Information about ＜ Major rental properties & occupancy rates：（Averages for 2020 2Q )> Investment property ＞ (billions of yen) Occupa 400.0 Site area Floor area ncy rate No. of floors （㎡） （㎡） （%） 300.0 40 floors above ground, Yebisu Garden Place（1） 56,943 298,007 100 5 below 2

  41. Slide 41: As an intrinsic part of people's lives, Sapporo will contribute to the evolution of lifestyles

    As an intrinsic part of people's lives, Sapporo will contribute to the evolution of creative, enriching and rewarding lifestyles. Copyright, 2020 SAPPORO HOLDINGS LTD. All rights reserved. 41/41

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