This is an English translation of the original Annual Securities Report (“Kukushkin Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Annual Securities Report(Report Pursuant to Article 24, Paragraph 1 of the Financial
Instruments and Exchange Act)
Fiscal Year
From January 1, 2021
(64th Fiscal Term)to December 31, 2021

Coca-Cola Bottlers Japan Holdings Inc.
（Formerly Coca-Cola Bottlers Japan Inc.）(E00417）

This is an English translation of the original Annual Securities Report (“Kukushkin Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Table of Contents[Cover Page]
Part I. Corporate Information .................................................................................................................................................................... 2
I. Overview ............................................................................................................................................................................................ 2
1. Summary of business results ......................................................................................................................................................... 2
2. History ........................................................................................................................................................................................... 6
3. Description of business.................................................................................................................................................................. 7
4. Information on affiliates ................................................................................................................................................................ 9
5. Employees ................................................................................................................................................................................... 11
II. Business overview .......................................................................................................................................................................... 12
1. Management policy, management environment and issues to be addressed ................................................................................ 12
2. Risk factors .................................................................................................................................................................................. 14
3. Management's analysis of financial condition, results of operations and cash flows ................................................................... 19
4. Important agreements for business .............................................................................................................................................. 24
5. Research and development activities ........................................................................................................................................... 24
III. Information about facilities ........................................................................................................................................................... 25
1. Overview of capital expenditures ................................................................................................................................................ 25
2. Major facilities ............................................................................................................................................................................ 25
3. Planned additions, retirements of facilities .................................................................................................................................. 26
IV. Information about reportable segment ........................................................................................................................................... 27
1. Information about shares ............................................................................................................................................................. 27(1) Total number of shares ........................................................................................................................................................... 27(2) Share acquisition rights .......................................................................................................................................................... 27(3) Exercises of moving strike convertible bonds ........................................................................................................................ 28(4) Changes in number of issued shares, stated capital ................................................................................................................ 28(5) Shareholding by shareholder category ................................................................................................................................... 28(6) Major shareholders................................................................................................................................................................. 29(7) Voting rights ........................................................................................................................................................................... 30
2. Acquisition of treasury stock ....................................................................................................................................................... 30(1) Acquisitions by resolution of shareholders’ meeting .............................................................................................................. 30(2) Acquisitions by resolution of board of directors’ meeting...................................................................................................... 30(3) Acquisitions not based on resolution of shareholders’ meeting or the resolution of board of directors’ meeting ................... 31(4) Disposals and holding of acquired treasury stock .................................................................................................................. 31
3. Dividend policy ........................................................................................................................................................................... 32
4. Corporate governance .................................................................................................................................................................. 33(1) Explanation about corporate governance ............................................................................................................................... 33(2) Information about officers...................................................................................................................................................... 40(3) Audit Status ............................................................................................................................................................................ 46(4) Officer compensation, etc. ..................................................................................................................................................... 48
V. Accounting ininformation ............................................................................................................................................................... 60
1. Consolidated financial statements ............................................................................................................................................... 61(1) Consolidated financial statements .......................................................................................................................................... 61(2) Other information ................................................................................................................................................................ 125
2. Financial Statements (Non-consolidated) .................................................................................................................................. 126(1) Financial statements (Non-consolidated) ............................................................................................................................. 126

This is an English translation of the original Annual Securities Report (“Kukushkin Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(2) Components of major assets and liabilities .......................................................................................................................... 136(3) Other information ................................................................................................................................................................ 136
Ⅵ. Overview of operational procedures for shares ........................................................................................................................... 137
Ⅶ. Reference information about the Company ................................................................................................................................ 138
1. Information about parent company of reportable segment ........................................................................................................ 138
2. Other reference information ...................................................................................................................................................... 138
Part Ⅱ. Information about company which provides guarantee to reportable segment .......................................................................... 139

This is an English translation of the original Annual Securities Report (“Kukushkin Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

[Cover Page]

Securities Report[Underlying article]

Article 24, Paragraph 1 of the Financial Instruments and Exchange Act[Recipient]

Director-General of the Kanto Local Finance Bureau[Submission date]

March 25, 2022

[Fiscal year]

64th fiscal term (from January 1, 2021 to December 31, 2021)[Company name]Coca-Cola Bottlers Japan Holdings Inc.

[Name and position of representative]

Calin Dragan, Representative Director & President[Address of head office]9-7-1 Akasaka, Minato-ku, Tokyo[Telephone number](03)-6896-1707[Name of administrative contact]

Tatsuhiro Ishikawa, Head of Controllers Senior Group Division, Finance[Closest contact point]

9-7-1 Akasaka, Minato-ku, Tokyo[Telephone number](03)-6896-1707[Name of administrative contact]

Tatsuhiro Ishikawa, Head of Controllers Senior Group Division, Finance[Location provided for viewing]

Tokyo Stock Exchange, Inc.
（2-1 Nihonbashi Kabutocho, Chuo Ward, Tokyo）

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of
the Kanto Local Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments
and Exchange Act of Japan. In the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
The Independent Auditor`s report that is included in Yukashoken Hokokusho is not translated to English. Therefore, it is not included inthis English translation.
For the purpose of this Annual Securities Report, unless context indicates otherwise, the “Company”, “we”, and “CCBJH” refer to CocaCola Bottlers Japan Holdings Inc., and the “Group” refers to the Company and its subsidiaries.

1This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Part I. Corporate Information
I. Overview
1. Summary of business results(1) Business results of the GroupInternational Financial Reporting Standards
Fiscal term
Fiscal year-end

60th

61st

62nd

63rd

64th

December 2017

December 2018

December 2019

December 2020

December 2021

Revenue(Millions of yen)

837,069

927,307890,009791,956

785,837

Profit before income (loss) tax(Millions of yen)

37,914

14,767(58,922)(12,065)(21,683)(Millions of yen)

21,967

10,117(57,952)(4,715)(2,503)(Millions of yen)

30,1493,152(52,164)(2,214)780

Equity attributable to owners of theparent(Millions of yen)654,611

580,448505,999

501,643492,320

Total assets(Millions of yen)

929,304

877,472

952,444939,603

867,111(Yen)

3,204.90

3,163.63

2,821.27

2,797.03

2,745.12

Basic earnings per share(Yen)

125.5352.68(322.22)(26.29)(13.96)

Diluted earnings per share

(Yen)

－

－

－

－

－

Ratio of equity attributable to ownersof the parent to total assets

(%)

70.4

66.2

53.1

53.4

56.8

Ratio of return on equity

(%)

4.6

1.6

(10.7)

(0.9)

(0.5)

(Times)

32.8

62.4

(8.7)

(61.2)(94.6)Cash flows from operating activities(Millions of yen)

73,014

51,244

42,62943,71635,982

Cash flows from investing activities(Millions of yen)

(14,299)(48,628)(68,308)(52,076)

15,271

Cash flows from financing activities(Millions of yen)

(26,717)(55,835)

73,994

20,912(67,134)(Millions of yen)

118,742

65,510113,825

126,378

110,497

17,197

17,10016,95916,27415,083[4,403][3,957][3,578][4,008][3,777]

Net profit attributable to owners of theparentComprehensive income attributable toowners of the parent

Equity per share attributable toowners of the parent

Stock yield

Cash and cash equivalents at the endof the year
Number of the employees[Average number of temporary
workers](People)(NOTE) 1. Revenue does not include consumption tax.
2. Diluted net income per share through 63rd fiscal years are not shown in the above table, as there are no residual
shares. Diluted earnings per share is not presented, as the effects of dilutive stock on earnings per share are antidilutive in the 64th fiscal year.
3. The consolidated financial statements are disclosed in accordance with the International Financial ReportingStandards ("IFRS") as issued by the International Accounting Standards Board from the 61st fiscal year.
4. Figures are rounded to the nearest million yen.
5. In the fiscal year ended 31 December 2020, the businesses of Q’sai and its subsidiaries were classified as discontinued
operations as a result of the decision made in December 2020 to sell all shares in Q’sai Co. Ltd. held by the Company.
Accordingly, the Revenue and the Profit before income tax for the 63rd fiscal year have been reclassified to theamounts for continuing operations excluding discontinued operations. Refer to “V. Financial information, 1.
Consolidated financial statements, (1) Notes to consolidated financial statements, 9. Disposal groups classified asheld for sale and discontinued operations” for the reclassified amounts of the Revenue and Profit before income taxof the discontinued operations.
2This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Japanese GAAP

Fiscal term

60th

Fiscal year-end

61st

December 2017 December 2018

Sales revenue(Millions of yen)872,623

968,439

Ordinary income(Millions of yen)

39,86026,011

Net profit attributable to owners(Millions of yen)of the parent

25,244

10,948Comprehensive income(Millions of yen)

31,976440

Net assets(Millions of yen)

627,486

550,775

Total assets(Millions of yen)883,919

833,915

Net assets per share(Yen)

3,070.01

2,999.40

Net profit per share(Yen)

144.26

57.01

Diluted earnings per share

(Yen)

-

-

Ratio of equity to asset

(%)

70.9

66.0

Ratio of return on equity

(%)

5.7

1.9

(Times)

28.5

57.6

(Millions of yen)

72,45050,768Cash flows from investing
activities(Millions of yen)

(41,091)(48,621)

Cash flows from financing
activities(Millions of yen)

(26,160)(55,366)(Millions of yen)

118,742

65,51017,197

17,100[4,403][3,957]

Price-earnings ratio
Cash flows from operating
activities

Cash and cash equivalents are
the beginning of the year
Number of the employees[Average number of temporary(People)workers](NOTE)

1. Sales revenue do not include consumption tax.
2. Diluted earnings per share is not disclosed because there are no potential ordinary shares.
3. The figures for the 60th fiscal period and thereafter are represented as the figures after the transfer to a holding company
through a share exchange with Coca-Cola East Japan Co., Ltd. on April 1, 2017.
4. The figures for the 61st fiscal year under Japanese GAAP have not been subjected to an audit which is required inaccordance with the provisions of Article 193-2, Paragraph 1 of the Financial Instrument and Exchange Act.
5. The figures of less than one million yen have been rounded off to the nearest million yen.

3

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(2) Management indicators of the Company
Fiscal term
Fiscal year-end

61st

62nd

63rd

64th

December 2017 December 2018 December 2019 December 2020 December 2021

Sales revenue and(Millions ofoperating revenue

yen)Ordinary income

60th(Millions ofyen)

93,705

10,37526,517

19,202

5,797

6,087

5,224

20,273

14,345

1,201

Net income(Millions of
yen)

4,991

4,395

20,702

15,742

18,395

Capital stock(Millions ofyen)

15,232

15,232

15,232

15,232

15,232

Total number of(Thousands ofissued sharesshares)206,269

206,269

206,269

206,269

206,269

405,242

332,507

331,139

342,391

351,812(Millions ofyen)

475,220

478,484

549,683

587,306

543,410(Yen)

1,984.02

1,812.27

1,846.32

1,909.09

1,961.66

44.00

50.00

50.00

25.00

50.00

(22.00)(25.00)(25.00)

－

25.00

(Yen)

28.52

22.89

115.11

87.77

102.57

(Yen)

－

－

－

－

102.33

(%)

85.3

69.5

60.2

58.3

64.7

(%)

1.2

1.2

6.2

4.7

5.3

(Times)

144.3

143.5

24.2

18.3

12.9

(%)

154.3

218.4

43.4

28.5

48.7

729

－

－

－

－

[41]

[－]

[－]

[－]

[－]

(%)

120.7

98.1

85.2

51.6

44.7

TOPIX Net Total
Return Index](%)[122.2][102.7][121.3][130.3][146.9]Highest stock price

(Yen)

4,385

4,815

3,490

3,070

2,131

Lowest stock price

(Yen)

3,065

2,793

2,157

1,462

1,236

Net assets
Total assets
Net assets per share
Dividends paid per
share(Interim dividends(Millions of
yen)

(Yen)

paid per share)
Net profit per share
Diluted earnings per
share
Ratio of equity to
asset
Ratio of return on
equityStock yield
Dividend payout ratio
Number of theemployees[Average number of(People)temporary workers]
Total Shareholder
Return[Comparative index:(NOTE)
1.
2.
3.
4.
5.
6.

Sales revenue and operating revenue do not include consumption tax.
Diluted net income per share through 63rd fiscal years are not shown in the above table, as there are no residual shares.
The figures for the 60th fiscal period and thereafter are represented as the figures after the transfer to a holding company
through a share exchange with Coca-Cola East Japan Co., Ltd. and a company split with New CCW Establishment
Preparation Company Co., Ltd. on April 1, 2017.
The figures of less than one million yen have been rounded off to the nearest million yen.
Coca-Cola Bottlers Japan Inc. was renamed Coca-Cola Bottlers Japan Holdings Inc. to clarify its role as a holding company
on January 1, 2018. As a result, the number of employees has been omitted from the 61st fiscal year
The highest and lowest stock prices are from Tokyo Stock Exchange 1st section.
4

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

7.

Partial Amendments to “Accounting Standards for Tax Effect Accounting” (Accounting Standards Board of Japan Statement
No. 28, February 16, 2018) have been applied from the beginning of the 62nd fiscal year. The main management indicators
for the 61st to 62nd periods are the figures after retroactive application of the relevant accounting standards.

5This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

2. History
Month and Year
Dec. 1960
Jul. 1961

Summary
Nichibei Inryo Co., Ltd. established with 50 million yen in capital at 1-5 Nagahama-cho, Fukuoka City for manufacture and sale of softdrinksHeadquarters move to 92 Tenjin-cho, Fukuoka City

Jun. 1962

Agreement on the manufacture and sale of Coca-Cola and Fanta concluded with The Coca-Cola Company and the Coca-Cola (Japan)
Company, Limited. granting the right to manufacture and sell Coca-Cola and Fanta in Fukuoka, Saga, and Nagasaki Prefectures

Jul. 1962

Began sales

Mar. 1963

Corporate name changed to Nichibei Coca-Cola Bottling Co., Ltd.

Apr. 1963

Headquarters move to 4127-29 Aza Ashitsugaura, Ohaza Hakozaki, Fukuoka City (now 7-9-66, Hakozaki, Higashi-ku, Fukuoka City)

Sep. 1972

Amended the previous agreements with The Coca-Cola Company and the Coca-Cola (Japan) Company, Limited and newly concluded alicense agreement with the Coca-Cola (Japan) Co., Ltd.

Jul. 1973

Corporate name changed to Kitakyushu Coca-Cola Bottling Co., Ltd.

Jun. 1994

Listed on the Fukuoka Stock Exchange

Nov. 1996

Listed on the second section of Tokyo Stock Exchange

Jun. 1998

Listed on the first section of the Tokyo Stock ExchangeFeb. 1999

Kitakyushu Coca-Cola Sales Co., Ltd. establishedJun. 1999

Some business transferred to Kitakyushu Coca-Cola Sales Co., Ltd.

Jul. 1999

Consolidated with Sanyo Coca-Cola Bottling Co., Ltd. and corporate name changed to Coca-Cola West Japan Co., Ltd.
With the consolidation, Sanyo Coca-Cola Bottling’s subsidiary Sanyo Coca-Cola Sales Co., Ltd. became a subsidiary of the Company
Listed on the first section of Osaka Securities Exchange and Hiroshima Stock Exchange

Apr. 2001

Acquired Mikasa Coca-Cola Bottling Co., Ltd. stock, making it a subsidiary

Feb. 2002

West Japan Products Co., Ltd. (later Coca-Cola West Japan Products, Co., Ltd.) established.

Apr. 2002

Some business transferred to Coca-Cola West Japan Products Co., Ltd. (now Coca-Cola West Products, Co., Ltd.)
Merged with both Sanyo Coca-Cola Sales Co., Ltd. and Kitakyushu Coca-Cola Sales Co., Ltd.

Jul. 2002

Four subsidiaries running vending business integrated to establish Nishinihon Beverage Co., Ltd. (made defunct through merger dated
January 1, 2010)
Amended the previous agreement with Coca-Cola (Japan) Company, Limited, and newly concluded a bottler’s agreement with
The Coca-Cola Company and Coca-Cola (Japan) Company, Limited.

Oct. 2002
Jan. 2005

Amended the previous agreements with The Coca-Cola Company and Coca-Cola (Japan) Company, Limited, and newly concluded amanufacturing agreement and a distributorship agreement with The Coca-Cola Company and Coca-Cola (Japan) Company, Limited.

Jul. 2006

Corporate name changed to Coca-Cola West Holdings Co., Ltd. and performed a demerger in which rights related to the sales of beverages
and food products were succeeded by the newly established Coca-Cola West Japan Co., Ltd.
Implemented share exchange making Kinki Coca-Cola Bottling Co., Ltd. a wholly-owned subsidiary
With the share exchange, Kinki Coca-Cola Bottling’s subsidiary Kansai Beverage Service Co., Ltd. (later Nishinihon Beverage Co., Ltd.)
became a subsidiary of the Company

Apr. 2007

Invested in Minami Kyushu Coca-Cola Bottling Co., Ltd., and made it an equity-method affiliate

Jan. 2008
Apr. 2008
Jan. 2009

Oct. 2010
Apr. 2013

Integrated two subsidiaries running manufacturing business to establish Coca-Cola West Products Co., Ltd.
Integrated subsidiaries running sales equipment service business to establish Coca-Cola West Equipment Service Co., Ltd.
Merged with Coca-Cola West Japan Co., Ltd., Kinki Coca-Cola Bottling Co., Ltd. and Mikasa Coca-Cola Bottling Co., Ltd. and changed
the corporate name to Coca-Cola West Company, Limited
Amended the previous agreements with The Coca-Cola Company and Coca-Cola (Japan) Company, Limited, and newly concluded abottler’s agreement with The Coca-Cola Company and Coca-Cola (Japan) Company, Limited.
Reorganized three subsidiaries running sales to establish West Vending Co., Ltd. (later Coca-Cola West Vending Co., Ltd.), Nishinihon
Beverage Co., Ltd. and Coca-Cola West Retail Service Co., Ltd. (Bottlers Japan Business Services Inc.)
Acquired Q’SAI CO., LTD. stock, making it a wholly-owned subsidiary
Implemented share exchange making Minami Kyushu Coca-Cola Bottling Co., Ltd. a wholly-owned subsidiaryJan. 2014

Merged with Minami Kyushu Coca-Cola Bottling Co., Ltd.

Jan. 2010

May. 2015

Acquired Shikoku Coca-Cola Bottling Co., Ltd. stock, making it a subsidiary

Apr. 2017

Implemented share exchange making Coca-Cola East Japan Co., Ltd. a wholly-owned subsidiary
Company name changed to Coca-Cola Bottlers Japan Inc.
In order to transition to a holding company structure, an absorption-type split was conducted in which businesses other than the GroupManagement Business and the Asset Management Business were transferred to New CCW Establishment Preparation Co., Ltd..
Corporate name changed to Coca-Cola Bottlers Japan Holdings Inc.
Transferred all shares of Q’sai.CO., LTD.

Jan. 2018
Feb. 2021

6

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

3. Description of business
The Group’s corporate group consists of the Company, 7 subsidiaries, one affiliates with Beverage business as its primary
operations. In addition, The Coca-Cola Company is an affiliated company. The following diagram sets out the positioning and businessof each company in the Coca-Cola Bottlers Japan Holdings Group’s (the “Group”) principal business activities. Business categories
correspond to segment categories.
Please note that the Company is a specified listed company as defined in Article 49, Paragraph 2 of the Cabinet Office Order on
Restrictions on Securities Transactions. Thus, the criteria for assessing the material facts under the insider trading regulations are
determined based on consolidated figures
Beverage business(Manufacture and sale of Coca-Cola and beverages)
a. Sales of beverages
Coca-Cola Bottlers Japan Inc., Coca-Cola Bottlers Japan Vending Inc., FV Japan Co., Ltd., Coca-Cola Bottlers Japan
Business Services Inc., etc.
b. Manufacture of beverages
Production of beverages is engaged by Coca-Cola Bottlers Japan Inc.,(Business related to vending machines)
It is engaged by Coca-Cola Bottlers Japan Vending Inc., etc.
(Procurement of ingredients and materials)
It is engaged by Coca-Cola Bottlers Japan Inc.
(Development, maintenance and operations of information systems)
They are engaged by Coca-Cola Bottlers Japan Inc.
Note that The Coca-Cola Company engages in sales of beverages (including beverage base).

7

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(Business Flow Diagram)
The matters described above are shown in the business flow diagram below.

8This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

4. Information on affiliates(1) Consolidated Subsidiaries
Name

Address

Commonstock(millions ofyen)

Coca-Cola Bottlers Japan
Inc.
(Note) 2,3

Minato-ku,
Tokyo

100

Manufacture and saleof beverages and
foods

100.0

Interlocking directorate: yes
Leasing of facilities: yes

Coca-Cola Bottlers Japan
Vending Inc.
(Note) 1

Minato-ku,
Tokyo

80

Operation of vending
machines

100.0(100.0)――――FV Japan Co., Ltd.
(Note) 1,4

Toshima-ku,
Tokyo

100

Sale of beverages
and foods

100.0(100.0)――――Coca-Cola Bottlers Japan
Business Services Inc.
(Note) 1

Minato-ku,
Tokyo

80

On-siteadministration

100.0(100.0)――――Principal businesses% of voting
rights interests

Relation

Other 3 companies(Notes)1.
2.
3.

The figures in parentheses for the % of voting rights interests column indicates the % of indirect voting interests, which is apart of the total voting interest.
It applicable to significant subsidiaries.
As for Coca-Cola Bottlers Japan Inc., the proportion of net sales (excluding internal sales among consolidated companies) toconsolidated sales exceeds 10%.
Major income statement information.
(1) Net revenues
780,366 million yen(JGAAP)(2) Recurring income(19,517) million yen(3) Net income(11,395) million yen(4) Net assets
412,606 million yen(5) Total assets
692,586 million yen

4.

As for FV Japan Co., Ltd. the proportion of net sales (excluding internal sales among consolidated companies) toconsolidated sales exceeds 10%.
Major income statement information.
(1) Net revenues
77,673 million yen(JGAAP)(2) Recurring income
1,547 million yen(3) Net income
894 million yen(4) Net assets
26,145 million yen(5) Total assets
40,358 million yen

5.

As the transfer of all shares in Q’sai, which is responsible for this business, was completed on February 1 2021, the company
and its subsidiaries have been excluded from the Group.

9This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(2) Equity Method Affiliates
Name

Address

Commonstock(millions ofyen)

Resources Co., Ltd.
(Note)

Takamatsu-shi,
Kagawa40

Principal
businesses
Vending
machine-related
business% of voting rights
interests

Relation

44.0(44.0)――――(Note)
1. The figures in parentheses for the % of voting rights interests column indicates the % of indirect voting interests, which isa part of the total voting interest.
2. As the transfer of all shares of Apex Nishi-Nihon Corporation was completed, the company was excluded from the scopeof application of the equity method.
(3) Other Affiliated Companies
Name

Address

The Coca-Cola Company(Note) 1, 2AtlantaGeorgia
U.S.A% of voting rights
Common stock(millions of Principal businesses interests in the
Relationdollars
Company（％）
Sales ofbeverages
18.88
1,760 (includingInterlocking directorate: yes(18.88)concentrate/beverage base))(Note)
1. The figures in parentheses for the % of voting rights owned are indirect ownership percentage.
2.
“Yukashoken Todokedesho” (Securities Registration Statement) or “Yukashoken Hokokusho” (Annual Securities
Report) has been submitted.

10This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto
Local Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act ofJapan. In the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

5. Employees(1) Consolidated Basis
As of December 31, 2021
Segment

Number of employees

Beverage business
Total

15,083[3,777]15,083[3,777](Notes)1. The number of employees excludes employees seconded from the Group to outside the Group and includes employees who areseconded from outside the Group to the Group and the number of temporary employees is shown separately in parentheses as
the average number over one year.
2. Temporary employees include part timers and casual workers, but not workers dispatched by staffing companies.
(2) Parent-alone Basis
Descriptions are omitted because the Company is a holding company(3) Labor Unions
The Group has the Coca-Cola Bottlers Japan Group East Labor Union and the Coca-Cola Bottlers Japan Group West Labor
Union, in addition to labor unions formed in certain subsidiaries, and the total number of members of the labor unions was
13,157 as of December 31, 2021. The Labor Union-management relations have remained cordial.

11

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto
Local Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act ofJapan. In the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

II. Business overview
1. Management policy, management environment and issues to be addressed(1) Fundamental Management Policy of The Company
CCBJH Group has established its corporate philosophy “Mission”, “Vision” and “Values” summarized as “Paint it RED!”.
As our Mission states, we will “deliver happy moments to everyone while creating values" through our business.
As our Vision, we depict an ideal status that leads us to the Mission.
・ We are the preferred partner for our customers
・ We win in the market through sustainable growth・ We lead a learning culture with commitment to grow・ We are the best place to work with pride for Coca-Cola
In order to realize the Mission and Vision, we defined four Values that we must always keep in mind and respect in ourdaily activities
・Learning
・Agility
・Result-orientation
・Integrity
We aim to achieve sustainable growth through our day-to-day business based on Mission, Vision and Values.

(2) Main targets
The future of the domestic soft drink market and business environment is expected to remain uncertain due to the rapid
spread of Omicron strains and other factor, the situation is expected to remain uncertain, and accounting estimates havebeen made based on the assumption that the impact will continue for a certain period of time from the fiscal year ending
December 31, 2022. The consolidated earnings forecast for the fiscal year ending December 31, 2022 is currently
undecided, but we will disclose our guidance at the appropriate time assuming a certain level of COVID-19 impact subsiding.
In the meantime, we will focus on what we can control in these following areas:
・Value share growth in vending, balanced approach in OTC with sustainable pricing
・Transformation that delivers recurring cost savings
・Continue to control capex and monitor market environment for expanding investments
・Stable shareholder return with Full-year dividend of 50 yen per share is planned
・Increase use the rate of PET bottles with sustainable materials(3) Issues to be addressed by the Company
Regarding the outlook for the overall Japan NARTD beverage market, although it is expected that a certain amount ofconsumer traffic will recover from 2021 that was under state of emergency for an extended period of time, the infection
cases are increasing by the spread of Omicron variant. Due to such concerns, it is expected that the uncertain situation willcontinue. In addition to the continued impact of changes in consumer purchasing behavior, such as the shift from immediate
consumption to at home consumption and the shift in purchasing channels, and the continued intense competitiveenvironment due to a delayed recovery of the overall demand. The difficult environment is expected to continue from the12

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto
Local Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act ofJapan. In the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

perspective of profitability, as global raw materials and oil prices are expected to rise.
Under these circumstances, we will continue to take actions to mitigate the short-term impact of the COVID-19 andposition 2022 as a “year of building a foundation for sustainable growth”, we will strive to build a solid base that leads tosteady sustainable growth and to promote further transformation. As important measures, we will work to 1) focus on core
categories and high-quality innovations, 2) continue ROI focused, customer-oriented marketing investment and execute
appropriate pricing strategies to strengthen the earnings base, and 3) strengthen collaboration between commercial and the
supply chain for low-cost logistics, 4) continue transformation to establish a business model that can achieve sustainablegrowth, and 5) increase the rate of sustainable materials used in PET bottles.
In the commercial area, despite the difficult environment, we will strive to achieved steady sales recovery and establish
a profit structure to deliver sustainable growth for the future by strengthening measures focusing on core categories,
launching new products based on innovations that utilize new technologies and new knowledge to expand the productportfolio, entering into white space (new area), and executing strategic marketing investments with ROI consideration.
Regarding our important vending channel, while considering the current and medium-term business environment, we areworking to increase the number of vending machine placements focusing on profitability and ROI. We will work to increase
sales from vending machines that contribute significantly to profits through a digital strategy such as the smartphone app"Coke ON". In addition, in the transformation of the operation model of the vending channel implemented in 2021, we haveachieved a significant reduction in fixed costs by improving how we operate. In the future, we will strive for stable operation
while deepening collaboration with supply chain, and will continue to improve operations by further utilizing digitaltechnology. In the over the-counter channel, changes in consumer purchasing pattern and intensified competition are
expected to continue, and although there are signs of recovery in our value share, we still recognize it as an area ofimprovement. Regarding this, we will work to solve our issue by development of new products, expanding space to sell,
ROI-conscious customer-oriented marketing investment, and appropriate pricing strategies based on the profitability.
Furthermore, by expanding the area of collaboration with Coca-Cola Japan Co., Ltd., we will build a system in which the
Coca-Cola system in Japan that can leverage our strength.
In supply chain, as part of a "Shinsei project" aimed at building a supply chain network that realizes high quality, lowcost, and stable supply, we promote stable operation of "Saitama Mega DC" which started operation in 2021 smooth launchof "Akashi Mega DC" scheduled to start operation ahead of schedule before the 2022 peak demand season, and consolidationof sales centers and reduction and optimal distribution of product inventory by synchronizing with these mega DCs. In termsof manufacturing, we will strive to provide a stable supply of products, improve manufacturing efficiency, and reduce costs
by improving manufacturing capacity and building flexible manufacturing systems. Furthermore, it is expected that demand
will continue to fluctuate, but taking the learnings from FY 2021, we will strengthen the collaboration between thecommercial (planning / sales) and the supply chain to work timely and low-cost supply of products adjusting to the changes
in the environment. In 2022, procurement costs are expected to rise due to rising prices of raw materials and crude oil, whichis expected to have a significant impact on the entire business. In the supply chain, we will strive to mitigate the impact ofincreased costs in the entire value chain by implementing meticulous improvement activities centered on stable and lowcost operations.
As the foundation of the entire business, we aim to further accelerate the standardization of business processes and theefficiency improvement by DX (digital transformation), and to establish a robust cost structure that can adapt to the changing
environment with agility. Additionally, we will continue to promote activities to achieve ESG targets based on creating
shared value with society, such as implement people development initiatives in accordance with our company “Mission,
Vision and Values”, "2030 Packaging Vision" aiming for a world-without-waste, and greenhouse gas (GHG) reduction target
formulated and announced in 2021 as Coca-Cola system in Japan.

13This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

2. Risk factors
This section outlines the major risks identified by the management as having the potential to have significant negative impact on
the financial conditions, business performance and cash flow of the consolidated companies.
The future-outlook and assumptions described in this section are those determined by the CCBJH Group as of the date ofsubmission of the Securities Report.
(1) Risk management structure of the CCBJH GroupThe CCBJH Group continues to strengthen its enterprise risk management (ERM) program which is aligned with the COSO
ERM framework. In 2021 we continued to build the program and capabilities by commencing the roll out of our Smart Risk
program driving cultural change by encouraging all employees to take informed risk to leverage opportunities for growth. By
fully embedding risk discussions into existing business routines, our people will strengthen their ability to identify risks andmanage them in a timely manner.
The business resilience program, which encompasses our ERM, crisis response, business continuity and insurance
strategies is led by the Head of Risk Management (HRM).

The HRM is tasked with maintaining a wide-angled view of all

business streams and emergent risks and opportunities and, through regular reporting, ensures that risk visibility is provided
to the Executive and our Board. The team works in close collaboration with the risk owners across functions in assessing andmanaging business risks. The Board which retains overall accountability and responsibility for our risk management andinternal control systems, has defined the Group’s risk appetite, and, through the Audit and Supervisory Committee, hasreviewed the effectiveness of these systems. During the year, the Board was provided full visibility of and actively considered
our reportable risks, which are those that have the potential to impact the ability of the Group to achieve its strategic objectives.
During this fiscal year, the Group focused on increasing the involvement of the management in the ERM processes.
Functional risk review sessions were held with senior management across the business with risk interviews conducted withthe members of the leadership team. The team also collaborated with Coca-Cola system stakeholders to build a structure thatstrengthens the risk management process by also considering the major risks affecting the entire Coca-Cola system.
The ongoing efforts to identify the risks and opportunities from the executive leadership team ranging from theRepresentative Director and President to the heads of all the internal functions included the recognition of uncertainties that
could impede the realization of the Group’s corporate philosophy, or the implementation and achievement of its mediumterm business plan. The identified risks are assessed from the perspective of the level of impact and the likelihood of
occurrence.

The major risks and opportunities to the business were determined through discussion in the Risk Management

Committee which is chaired by the Representative Director and President. Under the leadership of the executive team, riskowners are assigned to the risks and the actions to be taken to address these risks are finalized.
The ERM program incorporates a variety of processes which include alignment to our business strategies, objectives andprinciples; integration in our Group statements on strategic direction, ethics and values;

integration into the businessplanning cycle; continual monitoring of our internal and external environment for factors that may change our risk profileand create opportunities; establishment of training to increase risk awareness across all functions to develop informed risktaking leaders across all management levels; and an annual evaluation of the type and amount of insurance purchased toensure adequate financial protection is in place.
Our ERM activities include monthly risk discussions by the executive team to identify risks to our operational plans witha formal process, to identify the broader risks and opportunities, being conducted annually. These regular discussions and theformal cyclic process provide CCBJH with the opportunity to grasp the latest risk trends and review the major risks. To realize
the Group's growth strategy, the actions to address the major risks are incorporated into the annual business plan of eachfunction.

The ERM process is subject to internal audit against global best practices with the Head of Audit making

improvement recommendations as required.

14

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

CCBJH Group’s ERM cycle

CCBJH Group’s ERM structure (2021)

15

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Our Company-wide risk management program that leverages COSO best practice(2) Major risks
The major risks that may have a material impact on the CCBJH Group’s financial condition, business performance and cash
flow are listed in the table below priority order. The risks listed in this table do not necessarily cover all the risks to thebusiness and we may be affected in the future by new unexpected risks or other risks that are currently considered lessimportant or of a lower operational priority.
*Priority Level:
Potential Impact

Risk category

Description

Cyber Security
and System
Availability

Risk of business activities being
suspended, and confidential
information leaking caused bysystem failures or cyber incidents

 Losing trust from consumers
and customers
 Deterioration of financial
conditions

People Talent(Attraction andRetention)

Risk of not being able to secure,retain and develop enough humanresources and build constructive
relationships with labor unions due
to poor business performance and acompetitive employment
environment

 Slowdown or suspension ofbusiness activities
 Slowdown or suspension of
supply chain operations
 Inability to achieve growthplans

Naturaldisasters

Risk of death and injury of
employees and damage tobusiness facilities for
production, logistics and sales
operations caused by severe
natural disasters, such as,
earthquakes and floods

 Slowdown or suspension ofbusiness activities
 Slowdown or suspension of
supply chain operations
 Reduced sales opportunities
 Additional costs required
for recovery

Manufacturing,
Logistics &Infrastructure

Risk of the stable supply of goods
being impeded due to issues in
production and logistics operations,or changes in weather and consumer
behaviors

 Drop in sales volume andrevenue Losing trust from customers

Sustainability

Risk of increased stakeholder
concerns caused by the consumers’
negative sentiment over the use ofplastics and the toughening ofgovernment regulations on plastics

 Acquisition or loss of
consumer base Winning or losing trust fromshareholders
 Increase of costs forresponding to environmental
and social issues
 Discriminatory Taxation

16

Defined according to the level of impact and likelihood of occurrencePrior
Key mitigations
ity*
High
 Prepare the response plans to mitigate the damages
caused by system failures (such as, by setting up
backup sites) Improving and strengthening system security byproactive threat identification and conducting
simulation tests of cyberattacks
 Complying with laws and regulations on information
management
 Establishing internal regulations related to
information security supported by related employee
training programs
 Develop and maintain a system workforce with theability to respond to cyber incidentsHigh Implement strategic people development plans anddevelop a new salary payment structure Recruit diverse talent and commitment to people
development（including overseas）
 Implement unmanned plant operations, onlinetransactions, and outsourcing of shipping operations
 Enhance the workplace environment to improve
employee satisfaction
 Strengthen communication between top management
and employeesHigh Strong Business Continuity Plan (BCP) andcrisis response capabilities enabling structured
and streamlined responses
 Regular crisis and disaster response training andsimulations
 Identified alternative shipping locations andsecure transportation capacity in preparation fora disaster that damages the logistics centers Secure earthquake coverage
 Redesign of DCHQ model to enable enhanced
regional response and speed of responseHigh Building a flexible supply system to respond tochanges in the market environment
 Investment in infrastructure (production lines, etc.)that will enable the group to respond to the increasein demand during the peak seasons more readily
 Systems enhancements to enable timely sharing of
inventory status Strengthen supplier management and supervisionHigh Achieving CSV goals contributing to thedevelopment of a sustainable society"World Without Waste" initiatives including,increasing the use rate of recycled PET resin,developing more light-weighted packages andcollecting used PET bottles more effectively
 Proactive response in line with ESG and TCFD
reporting requirements.

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.
Prior
ity*
High

Risk category

Description

Potential Impact

Changing
ConsumermindsetRisk of changes in consumer
preferences caused by COVID19,
growing concerns over sugar
consumption and increased
health awareness Acquisition or loss of
consumer base Winning or losing trust fromconsumer Discriminatory taxation

Evolving
Commercial andCompetitive
Landscape

Risk of changes in the retail market
environment led by a surge in online
ordering and a decrease in people
movement due to COVID19.

 Acquisition or loss of
consumer base Winning or losing trust fromconsumers
 Reduced sales profit
 Reduced portfolio availability

High

Business
Transformation

Risk of failing to take measures toimprove competitive advantage(such as, through businessintegration, capital investment,
product development, etc.)

 Deterioration of financial
conditions caused by loss due
to impairment
 Losing trust from shareholders

High

Financial Risks

Risk of deterioration in financial
conditions cause by an increase infunding costs and retirement benefit
obligations

 Increased cost base Loss of stakeholder trust

Medi
um

Macroeconomic(Pandemic)

Risk of volatile and challenging
macro-economic conditions caused
by global events including
pandemics (the outbreak of
COVID-19)

 Deterioration of financial
conditions
 Reduced consumption
spending
 Changes in consumer
spending patterns.

Medi
um

Commodity
Pricing

Risk of procurement costs
increasing due to, such as,
fluctuations in exchange rates, rawmaterial shortages, and commodity
prices Increased cost base Reduced product supply
 Limitations to product portfolio

Medi
um

Quality and Food
SafetyThe risk of product related quality
and food safety incidents

 Losing trust from consumers
 Decline in earnings due to
product recall or massdisposal of defective
products
 Loss of opportunities due tocustomer penalties

Medi
um

Regulatory
Compliance andEthicsRisk of violations of laws, internal
regulations, and our code of ethicalconducts

 Loss of customer andconsumer trust Damage to brand and corporate
reputation
 Regulatory penalties
 Economic loss through fraud

Medi
um

Climate Change

Risk of raw material shortages
including water and agricultural
products or operational impacts due
to climate change.

 Reduced commodity
availability and product supply Increase of production costs
 Limitations to productportfolio Discriminatory taxation

Medi
um

Franchiserelationships

Risk related to our high dependencyon, or changes to our relationshipwith TCCC and CCJC as trademark
owners in respect to contract /relationship terms and renewals,
concentrate pricing, support for
product promotions.

Medi
um

Health and Safety

The risk of serious work-related
health and safety incidents (i.e.
serious injury or death) includingtransportation accidents.

 Decrease in sales from any
suspension in the use of TM
rights and/or decline inproduct development
capabilities and brandpower.
 Increased COGS due toconcentrate price.
 Increased sales promotion
expenses in event of any
decrease in sales support.
 Death or serious Injury
 Reputation damage
 Prosecution and fines

Medi
um

 Key mitigations
 Focus on product innovation and portfolio
expansion
 Strengthen range of low and no calorie
beverages.
 Diversification in pack sizes Promote active lifestyles through consumer
engagement program Enhancing the product portfolio and accelerated
productivity further to deliver products that meet theneeds of the retailers
 Enhancing Right Execution Daily (RED) to drive
operational excellence Expanding the online channels to respond to thesurge in Internet mail orders
 Building a robust system that enables the group to
respond readily and flexibly to various circumstances Formulate business integration strategies that takemultiple scenarios into consideration
 Supervision by Board of Directors and Executive
Officers
 Promote growth of cash flow through sales activities
to maintain and improve creditworthiness Establish Pension Governance Committee tostrengthen the monitoring function of retirement
benefit obligations
 Enhanced strategic and operational risk identification
enabling the group to grasp the changes inmacroeconomic landscape more quickly and prepare
better for the future by improving the ability to
predict the future demand and trends more accurately
 Monitoring and responding to changes in status tocustomers’ business operations
 Strong crisis response practices that focus on
employee, customer and consumer safety Mitigate the impact of exchange rate and productprice fluctuations through the uses of derivativetransactions
 Procure raw materials at lower costs throughcollective multi system company purchases
 Supplier quality audits and quality certifications
 Employee awareness of quality control in allprocesses from manufacturing to sales
 Enhance the quality control and reporting system sothat consumer/customer complaints receive a timely
response Robust identification and response programs thatenable us to quickly and efficiently deal withquality/food safety issues
 Strong Tone from the Top and continued internal
communication on corporate behaviors
 Ethics & Compliance Committee meetings held
regularly
 Minimizing employee frau opportunities byrebuilding the business processes, organizational
structure and IT systems
 Focus on sustainable procurement.
 Engagement with stakeholders
 Sourcing alternative suppliers, and strengthening theselection of suppliers and their management by
utilizing the performance data
 Adjust the amount of raw materials that are difficult
to procure, and shift to other raw materials whennecessary Maintaining and improving cooperative relationships
with The Coca-Cola Company and Coca-Cola(Japan) Company

 Continue ISO45001 (Occupational Health and
Safety) Certification/Internal Audit (Occupational
Health and Safety) strategies.
 Continue implementing mental health survey.

As a result of the efforts to identify the risks from all the internal organizations and consolidated subsidiaries, all the risks listed in the table above that have been classified as
the Group’s major risks for this fiscal year have been determined to be those related to the beverage business.

17

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(3) Response to COVID-19 Pandemic
The ongoing COVID-19 pandemic has continued to create macroeconomic uncertainties and accelerated changes in
consumer preferences and the retail market environment. The almost constant state of emergency declarations resulted in
shortening of the operation hours of restaurants, restrictions on holding large events and other restrictive measures led to a
slowdown of the Group’s beverage business. The safety of our employees, customers and consumers remains a top priority.
To mitigate the detrimental impact of the negative factors, the Group implemented countermeasures aimed at driving cost
reduction efforts further and accelerating the speed of business transformation. At the same time the Group was committed tosupporting our customers and consumers through initiatives to continue delivering safe and secure products, such as, byattaching antivirus film over the product selection buttons of the vending machines, as well as to the local communities bycontributing with essential products to medical institutions and Food Banks. We continue to deploy COVID-19 countermeasures and will implement agile initiatives that enable us to respond rapidly to the fast-changing business environment andconditions.

18

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

3. Management's analysis of financial condition, results of operations and cash flows
Overview of financial results(1) Overview of Full-Year 2020 Results
Coca-Cola Bottlers Japan Holdings Inc. (“CCBJH” or the “Company”, or “we”) announced full-year results for the fiscal year
ending on December 31, 2021 (January 1, 2021 to December 31, 2021).
As the effect of the coronavirus (COVID-19) continues and the business environment remains to be challenging, the continued
supply of our goods and services are essential for our customers and consumers, and the safety and health of our employees andcommunities are our top priorities. In accordance with our mission to provide happy moments for all, we have been operating
our business to ensure safe and secure product supply while taking comprehensive measures.
In this fiscal year (January 1, 2021 to December 31, 2021), despite last year's COVID-19 impact, rebound from the initial
impact, and the lifting of the state of emergency, the multiple state of emergency declarations have limited people traffic withheavy rain fall in August. As a result, the total domestic nonalcoholic ready-to-drink (NARTD) beverage industry volume growth
performance was limited to about 1% versus the previous fiscal year.
Under these circumstances, we have been working on measures to minimize the impact to sales by introducing new products
by responding to changing consumer and channel trends. Under the guiding principle that “business as usual is not an option”,
announced as part of our mid-term strategic business plan in August 2019, we continue to drive fundamental business
transformation initiatives. We have been pushing forward our transformation efforts in the further evolution of the vending
channel operation model, the relocation of product inventories, the consolidation of distribution bases centered around theSaitama Mega DC to optimize the distribution network in the Kanto area, the streamlining of the supply chain system to realize
low-cost operations, improving operational efficiency through company-wide digital transformation (DX), and the promotionof new work styles. While the business environment continues to be challenging, we are focused on identifying the issues andimplementing short-term mitigation plans, as well as seeking new opportunities for growth and efficiency as we work to respondto changes in the business environment over the medium and long term.
We continue our activities to realize our ESG goals based on creation of shared value with society. As part of our efforts toachieve the 2030 Packaging Vision, we continue to increase the use of sustainable materials PET bottles. As part of strengthening
our efforts, the Coca-Cola system in Japan has formulated targets to reduce greenhouse gas (GHG) emissions across the entire
value chain in Japan by 2030. This has led to our selection as a constituent of the DJSI Asia Pacific, a leading ESG investment
index for four consecutive years, and an A- score in a survey on water security conducted by CDP, an international environmental
non-profit organization.
Details for the full-year are as follows.
Full-year 2021 Highlights
・ In the fourth quarter (Oct. 1 - Dec. 31), although there were signs of growth in sales volume with the lifting of the state of
emergency declaration, the business was affected by concerns about the resurgence of the infection caused by the Omicronstrain into the year-end. For the full-year, COVID-19 impact continued. Recovery of consumer traffic impacted by repeatedemergency declarations and record-breaking rainfall in August.
・ Full-year sales volume increased by +2% YoY. Multiple new products contributed to volume growth, but the challenging
business environment continued. Full-year revenue declined by -1% YoY with the changing consumer spending patterns
impacting channel and package mix and lower revenue per case. Value share continued to grow for vending, and on arecovery trend for supermarkets, drugstores and discounters.
・ Business income exceeded the earnings guidance by 1.2 billion yen, supported by the slightly higher than expected volume
and the effect of additional cost saving measures. Compared to the previous fiscal year, a decreased of 14.8 billion yen.
Impacted by challenging business environment, cycling of significant temporary cost reduction achieved in the previous
fiscal year, and rising raw material prices.
・ In a challenging operating environment, with the focus on what we can control, transformation initiatives are progressing asplanned, achieving approximately 9B yen of recurring cost savings for the full-year.
・ Due to the increased uncertainty in the market returning with the resurgence of infection cases caused by the Omicron strain,
we have not provided the earnings forecast for 2022 at this time.

19This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Summary of Consolidated Financial Results(In million JPY except sales volume)
Full-year (January to December)

Change
(%)

2020

2021

791,956

785,837

(0.8)

458

458

2

Gross Profit

362,916

350,505(3.4)

Selling, General & Administrative Expenses

359,645

363,750

1.1

Other income (Recurring)

772

887

15.0

Other expenses (Recurring)

3,628

2,142

(41.0)

Investment loss on equity method

(245)

(162)

－

Business Income (Loss)

169(14,662)－

Other income (Non-recurring)

7,714

9,251

19.9

Other expenses (Non-recurring)

19,606

15,560(20.6)

Operating Loss

(11,722)(20,971)－

Net Loss Attributable to Owners of Parent(4,715)(2,503)－Q4 (October to December)

2020

2021

193,409

196,306

1.5

114

117

2

Gross Profit

87,42389,682

2.6

Selling, General & Administrative Expenses

89,67389,882

0.2

Other income (Recurring)

209

237

13.6

Other expenses (Recurring)

2,190

635

(71.0)

65

(41)

－

Business Loss

(4,167)(639)－

Other income (Non-recurring)

5,932

3,667

(38.2)

Other expenses (Non-recurring)

4,534

4,021

(11.3)

Operating Loss

(2,769)

(993)

－

(71)

(968)

－

Continuing Operation (Beverage Business)
Revenue
Sales volume of beverage business (million cases)

Change(%)

Continuing Operation (Beverage Business)
Revenue
Sales volume of beverage business (million cases)

Investment gain (loss) on equity method

Net Loss Attributable to Owners of Parent* 1. “Business Income (loss)” is a measure of our underlying or recurring business performance. Business Income (loss) deducts cost of
goods and selling, general and administrative expenses from revenue, and includes other income and expenses which we believe arerecurring in nature.
2 Net Income (Loss) Attributable to Owners of Parent is a total of continuing operation and discontinued operation results.

Consolidated revenue was 785,837 million yen (Which 0.8% decrease of 6,119 million yen from the same period prior year).
New products and initiatives responding to trend changes in channels contributed to the volume growth, but the prolonged periodof state of emergency delayed the recovery of traffic, and the record rain in August lead to a volume growth of only 2% versus
the previous year. In addition, the business environment has seen an increase of at-home consumption demand with people
refraining from going out or working from home resulting in consumer behavior changes impacting channel and mix, andcontinued severe competitive environment leading to decrease in revenue per case, impacting revenue. Although the state of20

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

emergency declaration was lifted in October, there were hopes for a recovery in people traffic that would lead to an improvementin the consumption environment. However, the business environment remained uncertain and challenging as the Omicron strain
toward the end of the year raised concerns about the resurgence of infections.
Consolidated business loss was 14,662 million yen (decrease of 14,831 million yen from the same period of prior year). To
minimize the impact of the decrease in revenue on profits, cost saving efforts were made in all areas, including recurring cost
reductions through transformation. Factors including adverse channel and package mix, decline in revenue per case, rise incommodity prices and logistics costs, and our decision to invest at appropriate levels in marketing and human resources thatwould contribute to our future growth had an impact. However, with the volume slightly ahead of expansion, and additional costsaving measures being implemented, we exceed the full-year forecast announced in November 2021 by 1.2 billion yen.
Consolidated operating loss was 20,971 million yen (decrease of 9,248 million yen from the same period of prior year). In
addition to the decrease in Business Income from the prior year, there was an increase in cost due to the accounting timing of
the temporary leave expenses and the timing of when the government subsidies for employment adjustment were received. Other
income (non-recurring) of this fiscal year includes 6,447 million yen in government subsidies for employment adjustment tooffset temporary leave expenses. Other expenses (non-recurring) include 9,001 million yen in temporary leave expenses and1,600 million yen in business transformation-related expenses related to the implementation of transformation based on themedium-term plan, 2,437 million yen in special retirement allowances due to the voluntary employee retirement program andexpenses incurred to recover the system failures that occurred in the core system used by the Group of 1,322 million yen.
Net income attributable to owners of parent for the year a total of continuing operations and discontinued operation was a lossof 2,503 million yen (2,212 million increase from the same period prior year) as a gain of 12,841 million yen was recorded indiscontinued operations as gains from stock sales due to the transfer of shares in Q’sai.

Beverage volume performance
Full-year 2021 sales volume is hereinafter represented as the percentage change from the same period of the previous year.
Although there were contributions from the introduction of new products and responses to changing trends in all channels, theincrease was 2% compared to the same period of the previous year due to the delay in the recovery of people traffic driven byrepeated emergency declarations and impacted by heavy rains in August, a peak summer month.
In terms of channel performance, although vending saw a recovery when the state of emergency was lifted, the increase waslimited to 1% due to delayed recovery of people traffic and unfavorable weather in August. Although the market environment
continues to be challenging, the value share of vending continued to grow for 33 consecutive months, mainly due to new products
in non-sugar teas and water, contributions from new package in sport, and campaigns through the Coca-Cola official smartphone
app Coke ON, which has reached 33 million downloads. In addition, we are working to strengthen the installation of vending
machines in prime locations while assessing the market environment and cost-effectiveness, resulting in a net increase in thenumber of vending machines compared to the end of the previous fiscal year. Supermarkets, drugstores and discounters increased
5% and 8% respectively for the full-year. This is partially due to capturing demand for at home consumption and bulk purchases,
as well as responding to changes in customers' purchasing patterns, and promotional activities at the point of sales. Value sharethat has been an issue is now on a recovery trajectory. In the CVS channel, despite contributions from new products in non-sugarteas and strategically rolled out 950ml PET, volume recovery has been delayed due to increased competition in promotions,
resulting in a 2% decrease for the full-year. In retail food, sales for commercial use continued to decline due to factors such as
shortened restaurant opening hours and decreased by 10%. For periods following the state of emergency being lifted, there wereperiods of temporary recovery. Online sales continued to grow strongly in all categories and increased by 62% for the full-year
supported by the successful rollout of label-less products well received by consumers' changing purchasing behavior andenvironmental awareness during COVID-19.
In terms of beverage category performance, sparkling was flat for the full-year despite contributions from the premium-priced
Fanta Premier series and other products as well as growth in supermarkets and other channels, it was not able to off-set theadverse weather in summer and drop in 500ml PET. New products such as Yakan Barley Tea from Hajime and Ayataka Cafe
Matcha Latte respectively contributed to 10% increase in non-sugar tea sales for Q4 and increased 7% for the full-year. Coffee
sales decreased 3% for the full-year due to a decline in sales of canned coffee in CVS and vending, despite growth in PET bottle
coffee through the introduction of new products such as Costa Coffee and Georgia Shot & Break. In sports, despite the lifting ofsome restrictions on events, contribution of channel specific packaging products, and the improved sentiment with the Olympic
Games, the category growth was 3% for the full year, as the Olympics Games were held without any spectators and the recordbreaking heavy rains during the summer. Water volume increased 23% for the full year, growing in every channel, by capturing
the growth of large PET with the increased demand of at-home consumption, as well as contributions from new ICY SPARK and
21

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Ilohas small PET.
The ready-to-drink alcohol category, despite the contribution from promotions of Lemon-dou and new products such as Nomel’s
Hard lemonade, it was not able to offset the cycling effect of the new products launched in the same period of the prior year anddecreased by 2%. We were working to capture the growing non-alcohol category and created a new brand and launched “Yowanai
Lemon-dou” on February 21st, 2022.
(2) Cash Flow
The cash flow conditions for the full-year are as follows:<Cash Flows from Operations>
Net cash generated from operating activities was 35,982 million yen (43,716 million net cash generated from operations in theprevious year period). This results mainly from the 21,683 million yen net loss before tax from continuing operation, depreciation,
increase in trade and other payables and decrease in other assets etc., offset by gain on sale of property, plant and equipment,
increase in trade and other receivables and payment of income taxes, etc.
<Cash Flows from Investment Activities>
Net cash generated from investing activities was 15,271 million yen (52,076 million yen outflow from investing activities theprevious year period), as cash used for acquisition of fixed assets was controlled, accounting for the current operating
environment and sales of Q’sai share resulted in proceeds from sales of shares of subsidiaries.
<Cash Flows from Financing Activities>
Net cash used for financing activities was 67,134 million yen (20,912 million yen net cash generated from financing activities
in the previous year period), driven by decrease of short-term loans for operating capital, payment of dividends and repaymentsof lease liabilities.
As a result of these activities, cash and cash equivalents at the end of the year was 110,497 million yen, a decrease of 15,881
million yen from the end of the prior fiscal year-end.
Overview of production, orders received and sales(1) Production results
Production results by business segment for the current fiscal year are as follows:
Segment nameMillions of yen

Beverage business

433,159

Year-to-year comparison (%)
97.2(NOTE) 1. Amounts are primarily consisted of production costs.
2. Amounts above do not include consumption taxes.
(2) Procurement results
Procurement results by segment for the current fiscal year are as follows:
Segment nameMillions of yen

Beverage business

35,685Year-to-year comparison (%)
96.7(NOTE) 1. Amounts are based on purchase prices.
2. Amounts above do not include consumption taxes.
(3) Orders received
Order status is omitted as the Group mainly engages in prospective production.
(4) Sales results
Sales results by segment for the current fiscal year are as follows:
Segment nameMillions of Yen

Beverage business

785,837

Year-to-year comparison (%)
99.2(NOTE) 1. The above amounts do not include consumption taxes.
2. Information on sales by major customer is omitted, as there are no counterparties with whom the ratio to overall sales
exceeds 10%.
22

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Analysis of financial condition, results of operations and cash flows(1) Significant accounting policies and estimates
The consolidated financial statements of the Group are prepared in accordance with IFRS. In preparing these consolidated
financial statements, certain items, including provisions, are based on estimates made by the Group. These estimates are basedon the Group’s historical results and matters that are deemed reasonable considering the future plans. The accounting standards
are described in 1. Consolidated financial statements, (1) Notes to Consolidated financial statements, (Significant accounting
policies) and (Significant accounting judgments, estimates and assumptions) under 5. Financial information.
(2) Analysis of financial position at the end of the fiscal year
The ratio of the Group's equity attributable to owners of the parent to total assets at the end of the fiscal year was 56.8%, andwe believe that our financial position remains sound.
Major factors of changes from the end of the previous fiscal year for each major item in the consolidated statement of financial
position are as follows:(Assets)
As of December 31,2021, total assets were 867,111million yen, a decrease of 72,492 million yen to compared with the endof the prior fiscal year-end period. Primarily due to the sales of the Q’sai shares on February 1, 2021, resulting in a decreaseof the assets held for sale and decrease on Property, plant and equipment as a result of restrained investment in sales equipment
and selling idle assets.
(Liabilities)
Total liabilities at the end of the year were 374,660 million yen which decreased by 62,851 million yen from the end of theprior year period. This is mainly due to decrease in bonds and borrowings with the repayment of short-term loans, and thesales of the Q’sai shares which could decreasing the Liabilities directly associated with assets held for sale.
(Net assets)
Total shareholder’s equity at the end of the quarter were 492,451 million yen, a decrease of 9,642 million yen from the end of
the prior year period. This mainly reflects a decrease in Retained earnings as a result of dividend payments.
Cash and cash equivalents as of December 31, 2021 was 110,497 million yen, which decreased by 15,881 million yen, or
12.6%, from the previous fiscal year as of December 31, 2020. See the consolidated statements of cash flows in " Overview offinancial results, (2) Cash flows” for more details.
(3) Analysis of results of operation for the current fiscal year
An overview of results of operation for the fiscal year is as described in "Overview of financial results, (1) Results ofoperations." Major changes from the previous fiscal year for each major item in the consolidated statements of profit or loss are
as follows: Net loss for the current fiscal year and Net Income (Loss) Attributable to Owners of Parent is a total of continuing
operation and discontinued operation results.
(Revenue)
Revenue for the current fiscal year decreased 6,119 million yen, or 0.8%, from the previous fiscal year to 785,837 million
yen.
(Operating loss)
Operating loss for the current fiscal year decreased 9,248 million yen, from the previous fiscal year to 20,971 million yen(The previous year's operating loss was 11,722 million yen).
(Net loss for the current fiscal year)
Net loss for the current fiscal year for the fiscal year increased 2,205 million yen, or from the previous fiscal year to 2,525
million yen. (The previous fiscal year's net loss was 4,729 million yen)
(Net loss for the current fiscal year attributable to owners of the parent)
Net loss for the current year attributable to owners of the parent for the fiscal year increased 2,212 million yen, from theprevious fiscal year to 2,503 million yen. (The previous year's Net income for the year attributable to owners of the parent was
4,715 million yen.)(4) Factors affecting financial position and results of operations
Factors that have significant impact on the Group's financial position and results of operations are described in "2. Businessrisks."

23

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

4. Important agreements for business
The Bottler’s Agreement
We have concluded the Bottler’s Agreement with The Coca-Cola Company and Coca-Cola (Japan) Company Limited for the
manufacture and sale of Coca-Cola, Fanta, Sprite, Real Gold, Georgia, Aquarius, Qoo, Sokenbicha, Huang, and Kochakaden,etc. and for the use of trademarks in Tokyo, Osaka, Kyoto, and 35 prefectures, including the South Tohoku, Kanto, Koshinetsu,
Chubu, Kinki, Chugoku, Shikoku, and Kyushu regions. Under this agreement, we have entered into the Delegation of
Manufacturing and Distribution Rights under Bottler’s Agreement with The Coca-Cola Company and Coca-Cola (Japan)
Company Limited to entrust the bottling business to Coca-Cola Bottlers Japan Inc.

5. Research and development activities
There are no specific items to state here.

24This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

III. Information about facilities
1. Overview of capital expenditures
The Group implemented capital expenditures totaling 40,184 million yen, primarily in the Beverage business, which is the main
segment of the Group, during the current fiscal year. The main contents of this investment were the introduction of vending
machines and other products to the market to strengthen sales capabilities, improvement of manufacturing efficiency, acquisitionof facilities for new products, and investment in the "Saitama Mega DC" to optimize the logistics network in the Kanto area. Capital
expenditures include the amounts for property, plant and equipment, Right-of-use assets and intangible assets.

2. Major facilities
Major facilities in the Group are as follows: The carrying amount is presented in accordance with IFRS.
(1) Segment breakdown
As of December 31, 2021
Carrying amount
Name of reporting segment

Buildings andstructures(Millions of yen)

89,968Beverage business

Machinery andVending
vehiclesmachines(Millions of yen) (Millions of yen)

105,436

87,692Land(Millions of
yen)

Other
(Millions of
yen)

Total
(Millions of yen)

142,463

48,569474,127

Number of
employees(People)15,083[3,629](NOTE) Figures in [ ] of number of employees are the number of temporary workers.
(2) The reportable segments
As of December 31, 2021
Carrying amount
Name of office(Location)

Head-office and others(Minato-ku, Tokyo,)

Name ofreportingsegment

Details offacilities

Beveragebusiness

Overallmanagement,
production,
sales, logistics
bases, etc.

Buildings and Machinery
Vending
structuresand vehicles machines(Millions of (Millions of (Millions of
yen)
yen)
yen)

19,16913－

Land(Millions ofyen)(Squarefootage: inthousands of
m2)

48,517(1,465)

Number of
employees
Other
Total
(Millions of (Millions of (People)
yen)
yen)

4,344

72,043－(NOTE) We changed the trade name to Coca-Cola Bottlers Japan Holdings Inc. on January 1, 2018 in order to clarify its role as theholding company. As a result, the number of employees has been omitted.

25

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(3) Domestic subsidiaries
As of December 31, 2021
Carrying amount
Name ofreportingsegment

Name(Location)

Coca-Cola Bottlers

Beverage

Japan Inc.

business(Minato-ku, Tokyo)

Details offacilities

Buildings and Machinery
structuresand vehicles(Millions of (Millions of
yen)
yen)

Vending
machines(Millions of
yen)

Land
(Millions ofyen)[Squarefootage: inthousands ofm2]

Production,

72,568sales, logistics

70,647

104,742

75,915(2,184)bases, etc.

FV Japan Co., Ltd.

Beverage

Vending(Toshima-ku, Tokyo)

businessmachines, etc.

Number of
employees
Other
Total
(Millions of (Millions of (People)
yen)
yen)

44,997368,870

169

12,852

[139]
587
63

14

12,017

(14)
[5]

8,006
[1,360]248[183](NOTE) 1. "Other" in "Carrying amount" consists of "Construction in progress" and "Other" in property, plant and equipment and"Software" and "Software in progress" in intangible assets.
2. Figures do not include consume tax.
3. Figures in [ ] of land (Square footage: in thousands of m2) are the area of leased land (Square footage: in thousands ofm2) and are not included in each figure.
4. Figures in [ ] of number of employees are the number of temporary workers and are not included in each figure.

3. Planned additions, retirements of facilities
The Group's capital expenditures are planned based on our budget formulation policy.
In principle, each company formulates its own facility plans, however, the reportable segment makes adjustments.
The Group's significant plans for the construction, renovation, etc. of facilities as of the end of the current fiscal year are as follows:
We have no plans to sell or retire any significant assets.
Name ofcompany

Name of office(Location)

Name ofreportingsegment

Details of
Facilities

Total planned
expenditures(Millions ofyen)Amount paid
(Millions ofyen)－

Coca-Cola
Bottlers
Japan Inc.

Each branch(-)

Beveragebusiness

Vending
machines andcooler, etc.

16,115Coca-Cola
Bottlers
Japan Inc.

Akashi “megadistribution center”(Akashi-shi,
Hyogo Prefecture)

Beveragebusiness

Logistics
equipment

15,525Way offinancing

Own fundScheduledstart date

Scheduledcompletion
dateJan. 2022

Dec 2022

Mar. 2020

Jul. 2022

Own fund and8,976 Debt within
the group(NOTE) Figures do not include consume tax, etc.

26

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

IV. Information about reportable segment
1. Information about shares(1) Total number of shares① Total number of shares
Type

Total number of authorized shares (shares)

Common stock

500,000,000
Total

500,000,000② Issued shares

Class

Number of issued sharesat the end of the fiscal year
(shares)(As of December 31, 2021)

Number of issued sharesat the filing date(shares)(As of March 25, 2022)

206,268,593

206,268,593

206,268,593

206,268,593

Commonstock
Total(2) Share acquisition rights① Details of the stock option plan
Not applicable.
② Description of rights plan
Not applicable.
③ Other share acquisition rights
Not applicable.

27

Listed financial
instrument name ofexchange or registeredauthorized financial
instrument name ofassociation of trading
firmsContent

Tokyo Stock Exchange

Number of shares per(First Section)

share unit: 100 shares－－

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(3) Exercises of moving strike convertible bonds
Not applicable.
(4) Changes in number of issued shares, stated capital
Outstanding of
Change in number
total number ofof issued shares
Dateissued shares(Thousands of(Thousands ofshares)shares)April 1, 2017
(NOTE)

95,143

Change in the
Balance of stated Change in capital Balance ofamount of statedcapitalsurpluscapital surplus
capital(Millions of yen) (Millions of yen) (Millions of yen)
(Millions of yen)－

206,269－

15,232

108,167(NOTE) Share exchange with Coca-Cola East Japan Co., Ltd. (Exchange ratio: 0.75 shares of ordinary share per common stock of
Coca-Cola East Japan Co., Ltd.)(5) Shareholding by shareholder category
As of December 31, 2021
Status of shares (number of shares constituting one unit: 100 shares)
Category

National andlocal
governments

Financial
Other
service
corporations
providers

Financial
institutions

Number of shareholders(people)

－

49

42

Number of shares held
(units)－

340,641

Percentage of shareholdings
(%)

－

16.58

Foreigners

Individuals
and others

Total

Number ofshares lessthan one unit
(Shares)

Other than
individual

Individuals

726

272

158

61,55662,803－

51,209661,102431,150610

570,091 2,054,803

788,293

2.49

32.17

20.98

0.03

27.74

100.00－(NOTE) 1. "Individuals and Others" and "Shares less than one unit" column include 269,246 units and 31 shares of treasury stock
owned by the Company, respectively.
2. "Other corporations" and "Shares less than one unit" include 23 units and 60 shares in the name of Japan Securities
Depository Center, Inc., respectively.

28

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(6) Major shareholders
As of December 31, 2021

Name

Address

Number ofshares held
(thousands ofshares)Percentage of thenumber of shares
held to the total
number of issued
shares (excluding
treasury stock) (%)

Coca-Cola (Japan) Company, Limited

4-6-3, Shibuya, Shibuya-ku, Tokyo

27,956

15.59

The Master Trust Bank of Japan, Ltd. (Trust
Account)

2-11-3, Hamamatsucho, Minato-ku, Tokyo

17,617

9.82

Ichimura Foundation of New Technology

1-26-10, Kitamagome, Ota-ku, Tokyo

5,295

2.95

Custody Bank of Japan, Ltd. (Trust Account)

1-8-12, Harumi, Chuo-ku, Tokyo

4,925

2.75

Satsuma Shuzo Co., Ltd.

26 Kamimotocho, Makurazaki-shi,
Kagoshima

4,699

2.62

Senshusha Co., Ltd.

339 Noda, Noda-shi, Chiba

4,088

2.28

Coca-Cola Holdings West Japan Inc.
(Standing proxy: Coca-Cola (Japan) Company,

1013 Wilmington Center Road, U.S.A.
Delaware

4,075

2.27

Limited)(4-6-3 Shibuya, Shibuya-ku, Tokyo)

Mitsubishi Heavy Industries Machinery Systems,
Ltd.

1-1-1, Wadazakicho, Hyogo-ku, Kobe-shi,
Hyogo

3,912

2.18

MCA Holdings, Co., Ltd.

7-10-16, Ginza, Chuo-ku, Tokyo

3,408

1.90

P.O. BOX 351 BOSTONMASSACHUSETTS 02 101 U.S.A.

3,223

1.80

79,198

44.16

STATE STREET BANK AND TRUSTCOMPANY 505225(Standing proxy Settlement & Clearing &Services Division, Mizuho Bank, Ltd.)(2-15-1 Konan, Minato-ku Tokyo)

Total

-

(Notes) 26,925 thousand treasury shares are not included in the status of major shareholders above because they do not have voting
rights.

29

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(7) Voting rights① Issued shares
As of December 31, 2021
Category

Number of shares(Shares)Number of voting rights(Units)Description

－

－

－

－

－

－

－

－

－

－

－

Shares with no voting rights
Shares with restricted voting rights(treasury stock, etc.)
Shares with restricted voting rights (other)
Shares with full voting rights (treasury
stock, etc.)
Shares with full voting rights (other)

Commonstock

26,924,600

Common178,555,700

stock
Common1,785,557－

788,293－－

Number of issued and outstanding shares

206,268,593－－

Number of voting rights of all shareholders－

Shares less than one unit

stock

1,785,557－(NOTE) "Shares with voting rights (others)" includes 2,300 shares (23 voting rights) held in the name of Japan Securities Depository
Center, Inc.
② Treasury stock

Number ofshares held insomeone else’s
nameNumber ofshares held in
own names

As of December 31, 2021
Percentage of thenumber of shares
Total number
held to the totalof shares heldnumber of issued
shares (%)

Name of shareholder

Address ofshareholder

Coca-Cola Bottlers
Japan Holdings Inc.

9-7-1, Akasaka,
Minato-ku, Tokyo

26,924,600－

26,924,600

13.05

－

26,924,600－

26,924,600

13.05

Total

2. Acquisition of treasury stock
Classes of shares: Acquisitions of common stock falling under Article 155 Paragraph 7 of the Companies Act.
(1) Acquisitions by resolution of shareholders’ meeting
Not applicable.
(2) Acquisitions by resolution of board of directors’ meeting
Not applicable.

30

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(3) Acquisitions not based on resolution of shareholders’ meeting or the resolution of board of directors’ meeting
Acquisition of shares less than one unit pursuant to the provisions of Article 192, Paragraph 1 of the Companies Act
Category

Number of shares (Shares)

Acquired treasury stock during the fiscal year
Acquired treasury stock during the period (January 1, 2022 to
the filing date of this report)

Total amount (Yen)

4,506

7,614,029

179

253,514(NOTE) "Acquired treasury stock during the period" does not include shares acquired due to requests for purchase of shares less than
one unit from March 2nd, 2022 to the filing date.
(4) Disposals and holding of acquired treasury stock
The fiscal year
Category

Acquired treasury stock for which subscribers
have been solicited
Disposals of acquired treasury stock by
cancellation
Acquired treasury stock transferred due tomerger, share exchange, Share issue, orNumber of shares(Shares)

Total disposed
amount(Yen)

The period (January 1, 2021 to thefiling date of this report)
Total disposed
Number of sharesamount(Shares)
(Yen)

－

－

－

－

－

－

－

－

－

－

－

－

173

550,410－－

26,924,631－

26,924,810－

company split
Other(Sale by request for the purchase of odd-lot
shares)(Note 1)
Number of treasury stock held (Note 2)(NOTE) 1. "Other (Sale by request for the purchase of odd-lot shares)" column in "The period" does not include shares sold due torequest for sale of shares less than one unit from March 2nd, 2022 to the filing date.
2. "Number of treasury stock held" column in "The period" does not include shares sold in response to requests for thepurchase of odd-lot shares from March 2nd, 2022 to the filing date and requests for the sale of odd-lot shares.

31This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

3. Dividend policy
The Company periodically reviews its capital structure and dividend payout ratio to maximize shareholder returns while
maintaining flexibility to pursue growth opportunities. The Company seeks to use retained earnings to fund investment forsustainable growth for our business and further enhancement of corporate value.
CCBJH sets its basic policy regarding dividends, which includes active redistribution of profits while placing the highest priority
on paying dividends in a stable manner, by comprehensively reviewing the Company’s business performance and level of retained
earnings. In addition, the Company has set a payout ratio target of 30% or more for net profit attributable to owners of the parent.
Which the company pays interim and year-end dividends.
With regards to the dividends for the fiscal year ending December 2021, the Company plans to pay 25 yen per share as the yearend dividend, which as a result, will make the total amount of dividends in FY2021 reach 50 yen per share when combined with
25 yen per share already paid as the interim dividend. Despite of the slow recovery of consumer traffic due to the ongoing risks
of COVID-19 and the adverse impact of unseasonable weather in August on business activities during the peak season, theCompany has been able to maintain a robust financial foundation through various approaches including consistent cost reduction
efforts continuing from last year, carefully planned capital expenditures considering the uncertainties of the business environmentand selling of assets. While the tough business environment remains unchanged from the previous fiscal year (ending December2020), the Company intends to follow through its basic policy of paying dividends stably by putting the aforesaid dividend scheme
into action as a plan.
As per the forecast of the dividends for the fiscal year ending December 2022, the Company seeks to maintain its basic policyof stable dividend payment by setting the same amount as in FY 2021 (annual total of 50 yen per share consisting of 25 yen per
share paid as interim dividend and another 25 yen per share as year-end dividend).
On future shareholder returns, the Company stays committed to maximizing the value by comprehensively reviewing its businessperformance trends and financial conditions, and examining the best approaches that could be taken by including the share
repurchase program.
Dividends from retained earnings for the current fiscal year are as follows:
Amount of dividend
Total dividend
Date of resolution
per share(Millions of yen)
(Yen)
August 11,2021
Board of Directors

4,484

25

March 24, 2022
Resolution of the Ordinary
General Meeting of
Shareholders

4,484

25

32

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

4. Corporate governance(1) Explanation about corporate governance① Basic stance on corporate governanceOur basic stance on corporate governance is to seek improvement of management soundness, transparency and efficiency andincrease mid-to-long-term corporate value and shareholder value.
We have established the Audit and Supervisory Committee to further strengthen our governance system. The Audit andSupervisory Committee, which takes a lead role in audits, is composed entirely of outside directors (Audit and Supervisory
Committee members), including multiple independent outside directors. The Audit and Supervisory Committee members, who
are outside directors, have voting rights at the Board of Directors meetings and the rights to express opinions on directors'
nominations and compensation at the General Meeting of Shareholders. As a result, our management oversight functions havebeen further strengthened.
In addition, we have adopted the executive officer system to separate decision-making and management oversight functions
from business execution functions. Certain important business execution decisions are entrusted to directors, so that the Board of
Directors can deliberate on matters of particular importance. For other matters, we place emphasis on speed of management
decisions by the Executive Leadership Team.
② Corporate governance structure and the reason for adopting this structure
We have established the Audit and Supervisory Committee to further strengthen our governance system. The Audit andSupervisory Committee, which takes a lead role in audits, is composed entirely of outside directors (Audit and Supervisory
Committee members), including multiple independent outside directors. The Audit and Supervisory Committee members, who
are outside directors, have voting rights at the Board of Directors meetings and the rights to express opinions on directors'
nominations and compensation at the General Meeting of Shareholders. As a result, our management oversight functions havebeen further strengthened. In addition, we have adopted the executive officer system to separate decision-making and management
oversight functions from business execution functions. Certain important business execution decisions are entrusted to directors,
so that the Board of Directors can deliberate on matters of particular importance. For other matters, we place emphasis on speedof management decisions by the Executive Leadership Team.
We believe that the following corporate governance structure can improve management efficiency and transparency, andaccordingly, we have adopted this structure.
a. Board of Directors
The Board of Directors is composed of nine directors, including multiple independent outside directors. The Periodic Meetingof the Board of Directors shall be held once in three months in principle and may be held as needed. The Board of Directors shallresolve items prescribed by laws and the Articles of Incorporation and other items relating to important business matters such as
managerial basic policies and shall receive Directors’ report on their execution of the duties. Certain important business execution
decisions are entrusted to directors, so that the Board of Directors can deliberate on matters of particular importance. For othermatters, we place emphasis on speed of management decisions by the Executive Leadership Team.
b. Audit and Supervisory Committee
The Audit and Supervisory Committee is composed of four outside directors (Audit and Supervisory Committee members),
including multiple independent outside directors. Meetings of the Audit and Supervisory Committee shall be held once every threemonths in principle and may be held as necessary. The directors who are members of the Audit and Supervisory Committee
conduct audits aimed at checking the status of business execution by the directors, executive officers and employees in accordancewith related laws and regulations, the article of incorporation, and the audit standards and guidelines established for and by the
Audit and Supervisory Committee, by participating in the Board of Directors meeting and reviewing the results of the audits
conducted by the Internal Audit Office and Accounting Auditor.
A system to ensure sufficient oversight of business execution by executive officers is established, which include the regularexchange of opinions between the Representative Director and the members of the Audit and Supervisory Committee on the resultsof the aforesaid audit activities.

33

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(Main institutions)
Institution
Board ofDirectors

Purpose and authority(a) The Board of Directors shall

Chair person

MemberCalin Dragan

Calin Dragan, Bjorn Ivar Ulgenes,

resolve items prescribed by laws

Representative

Hiroshi Yoshioka (Outside Director,

and the Articles of Incorporation

Director

Independent Director),and other items relating to

Hiroko Wada (Outside Director, Independent

important business matters such

Director),

as managerial basic policies.

Hirokazu Yamura (Outside Director,(b) The Board of Directors shall

Independent Director),

receive Directors’ report on their

Irial Finan (Outside Director),

execution of the duties.

Celso Guiotoko (Outside Director,
Independent Director),
Nami Hamada (Outside Director, Independent
Director),
Vamsi Mohan Thati (Outside Director)

Audit and(a) Audit of the performance of theSupervisory

director’s duties and preparation

Committee

of audit reports;

Irial Finan

Irial Finan (Outside Director),

Outside Director

Celso Guiotoko (Outside Director,
Independent Director),(b) Determination of the contents ofNami Hamada (Outside Director, Independent

proposals regarding the election,

Director),dismissal or disapproval of

Vamsi Mohan Thati (Outside Director)

reappointment of accounting
auditors;(c) Determination of opinion of the
Audit and Supervisory
Committee regarding theelection, dismissal or resignationof directors and remuneration,etc. (excluding directors who are
Audit and Supervisory
Committee Members.);(d) Other duties provided for inapplicable laws and regulations
and the articles of incorporation,
etc.

34

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

35

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(The system to ensure business adequacy)
In order to establish the system to ensure that the jobs conducted by the Directors comply with the laws and regulations and the
Articles of Incorporation, and other systems to ensure appropriateness of operation (to be referred to as “internal control”
hereinafter), the Company has made a resolution on “the Internal Control System Basic Policy” at the Board of Directors
Meeting.
The Internal Control System Basic Policy is as shown below.
a. System to ensure that performance of duties by Directors and employees of the CCBJH Group conforms to laws and regulations
and the Articles of Incorporationa) The “Code of Conduct” shall be established in order to ensure that all the Directors, Executive Officers, and employeesof the Group comply with laws and regulations and the Articles of Incorporation to act in conformity with social norms. The
Risk Management Committee shall be convened periodically in order to reinforce the compliance system and to prevent noncompliance.
b) An internal whistle-blowing system against non-compliance, namely, a reporting and consultation contact separate from thereporting line to immediate managers, shall be set up.
c) The oversight function of the Board of Directors shall be reinforced by adopting the company system where Audit andSupervisory Committee is established in order to ensure auditing by the Audit and Supervisory Committee where all of theconstituent members are External Directors.
d) The department in charge of internal auditing shall be established in order to audit whether business activities are conducted
appropriately and effectively in conformity with laws and regulations, the Articles of Incorporation, Company Rules andRegulations, etc.
e) The Company clearly identifies a firm stance against anti-social forces and organizations that cause threats to the order andsafety of civil society and that the Company never associates with such entities. The Company shall never accede to any illegal
request and deal with any such request in cooperation with the police, lawyers, etc.
b. System to retain and manage information related to Directors’ performance of their dutiesa) The Company shall record information regarding minutes of General Shareholders meetings, minutes of Board of Directors
meetings, documents and other materials related to important decision-makings and Directors’s performance of their duties indocuments or electronic media and retain it in accordance with the Rules of Documentation Handling and Information Security
Policy in a manner similar to that for statutory documents.
b) The Company’s Directors may inspect such documents, etc. at any time.
c. Regulations and other systems concerning loss risk management of the Groupa) In accordance with the Group policy on responding to material business risks and from the viewpoint of management ofother risks, significant items shall be reported to the Risk Management Committee, and the Committee shall determine policies
to deal with risks as required.
b) The Company establishes rules, guidelines, etc. and maintains an organization to execute effective response to material risks,and ensure the matters to be passed down by implementing training for the entire Group, etc.
c) The department in charge of risk management in the Company or its subsidiaries is to monitor the condition of companywide risks and to take appropriate measures on a group-wide basis. The Company promptly designates who is in charge of the
response to new risks that arise.
d. System to ensure efficiency of performance of duties by the CCBJH Group Directorsa) The Company’s Board of Directors shall determine Group-wide management policy and goals shared by the Directors,
Executive Officers, employees and others of the Group, and determine the efficient method to achieve the goals including theallocation of authority based on the group’s decision-making rules.
b) In addition to Board of Directors Meetings, appropriate forums, such as the Management Meeting, shall be organized todeliberate significant matters affecting the entire Group, thereby ensuring that decisions are reached based on considerationsof multi-dimensional aspects.
e. System to ensure appropriateness of operations in a corporate group, which consists of the Company and its subsidiaries
The Company shall ensure management integration of the Group through establishment of a corporate philosophy,
management policy, the Code of Ethics and Conduct and Chart of Authority common throughout the Group and supervise andmanage the performance of the subsidiaries’ operations.
f. Matters concerning employees assisting the Audit and Supervisory Committee to execute the duties if the Audit and Supervisory
Committee request the assignment of such employees, matters concerning the independence of such employees from directors(excluding directors serving on the Audit and Supervisory Committee) and matters related to ensuring the effectiveness of
instructions given by the Audit and Supervisory Committee to such employees
The Company shall assign employees assisting the Audit and Supervisory Committee. Such employees shall execute the duties
under the instructions given by the Audit and Supervisory Committee in assisting executions of duties by the Audit andSupervisory Committee and shall not receive instructions from directors (excluding directors serving on the Audit and36

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Supervisory Committee).
g. System for reporting by Directors and employees of the CCBJH Group to the Audit and Supervisory Committee and systems toensure that reporting parties do not receive disadvantageous treatment as a result of such reportsa) Upon discovery of any incident that could cause the Group substantial damage, such as acts in violation of laws andregulations, the Directors (excluding Directors serving on the Audit and Supervisory Committee), Executive Officers,
employees and others of the Company shall immediately report the matter to the Audit and Supervisory Committee.
b) The Internal Audit Department and the Risk Management Committee shall regularly report internal audit results and thestatus of other activities in the Group to the Audit and Supervisory Committee.
c) The department in charge of compliance shall regularly report the status of whistle-blowing in the Group to the Audit andSupervisory Committee.
d) The Company shall prohibit unjust treatment of the reporter to the Audit and Supervisory Committee and ensure that thismatter would be informed to all the executives and employees of the group.
h. Matters concerning procedures for advance payment or reimbursement of expenses incurred in the course of performance of
duties by Directors serving on the Audit and Supervisory Committee and policies related to processing expenses or liabilities
arising from performance of duties by Directors serving on the Audit and Supervisory Committee
The Company establishes enough budget for Directors serving on the Audit and Supervisory Committee each year to fulfill theperformance of their duties.
i. Other systems to ensure that the Audit and Supervisory Committee’s audit is conducted effectivelya) The Representative Director and the Audit and Supervisory Committee shall hold a meeting on a regular basis to exchange
opinions in order to communicate with each other.
b) The Representative Director shall prepare an environment so that the Audit and Supervisory Committee is able to cooperatewith external experts, such as lawyers and certified public accountants, in the course of its duties whenever it deems it necessary.
c) The Audit and Supervisory Committee shall regularly provide opportunities for the exchange of opinions with the Internal
Audit Department and accounting auditors.
.
(Design of risk management system)
The Company has developed Group Rules for Risk Management and is proactively working on preventing the occurrence ofvarious risks that may arise for the Company together with ensuring that in the event of a risk occurrence, that response strategies
exist that allow us to respond in a prompt and adequate manner thereby minimizing the damage and business disruption.
Furthermore, in order to minimize damage and business impacts caused by natural disasters, etc., crisis training, disaster drills
and safety confirmation drills are being held regularly thereby testing our business continuity plans in response to a large-scaledisaster.”In addition, we have developed Code of Ethics to conduct for officers and employees of the Group, which shows the Group's
corporate stance of "complying with all laws and regulations, acting in good faith in society, and enhancing corporate value by
earning the trust of all stakeholders", and have been thoroughly communicating it to all officers and employees.
③ Company organizations
a. Number of directors
The Articles of Incorporation stipulate that the number of the directors who are not members of the Audit and Supervisory
Committee shall be ten or less, and the directors who are members of the Audit and Supervisory Committee shall be seven or
less.
b. Requirements for election of directors
The Articles of Incorporation stipulate that the directors who are not members of the Audit and Supervisory Committee andthe directors who are members of the Audit and Supervisory Committee shall be elected by a majority of the vote attended by
the shareholders holding at least one-third of the voting rights of the shareholders who are entitled to exercise their voting rights,
and that they shall not be elected by cumulative voting.
c. Decision-making body for acquisition of treasury stocks
The Articles of Incorporation stipulate that treasury stocks may be repurchased through market transactions, etc. by aresolution of the Board of Directors without a resolution of the General Meeting of Shareholders, in accordance with theprovisions of Article 165, Paragraph 2 of the Companies Act. The purpose of this is to improve capital efficiency and to
implement flexible capital policies in response to changes in the business environment through authorizing the Board of
Directors to make decision for acquisition of treasury stocks.
d. Decision-making body for interim dividends
The Articles of Incorporation stipulate that interim dividends defined in Article 454, Paragraph 5 of the Companies Act may
be paid by the resolution of the Board of Directors without a resolution of the General Meeting of Shareholders. The purposeof this is to flexibly return profits to shareholders through authorizing the Board of Directors to make decision for interim37This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

dividends.
e. Requirements for the special resolution at the General Meeting of Shareholders
The Articles of Incorporation stipulate that the special resolution at the General Meeting of Shareholders defined in Article
309, Paragraph 2 of the Companies Act shall be made by two-thirds of the vote attended by the shareholders holding at least
one-third of the voting rights of the shareholders who are entitled to exercise their voting rights. The purpose of this is tofacilitate the operation of the General Meeting of Shareholders through easing the quorum for the special resolution at theGeneral Meeting of Shareholders.
f. Business execution and management oversight
The Representative Director monitors and supervises the business activities executed by the executive officers andemployees of the operating companies by participating in major meetings and other meetings held in the operating companies.
The directors who are members of the Audit and Supervisory Committee conduct audits aimed at checking the status ofbusiness execution by the directors, executive officers and employees in accordance with related laws and regulations, thearticle of incorporation, and the audit standards and guidelines established for and by the Audit and Supervisory Committee,
by participating in the Board of Directors meeting and reviewing the results of the audits conducted by the Internal Audit
Office and Accounting Auditor.
A system to ensure sufficient oversight of business execution by executive officers is established, which include the regularexchange of opinions between the Representative Director and the members of the Audit and Supervisory Committee on the
results of the aforesaid audit activities.
④ Basic Policies on the Control of the Joint-stock Company
a. Details of Basic Policy
The Company believes that the persons and/or entities (hereinafter referred as “Persons”) who control decisions on the
Company’s financial and business policies need to understand the source of the Company’s corporate value and will make itpossible to continually and persistently ensure and enhance the Company’s corporate value and, in turn, the common interestsof its shareholders. The Company believes that a decision on any proposed acquisition that would involve a change of corporate
control of the Company should ultimately be made based on the intent of its shareholders as a whole. Also, the Company
would not reject a large-scale acquisition of the shares in the Company if it would contribute to the corporate value of theCompany and, in turn, the common interests of its shareholders.
However, there are some forms of large-scale acquisition of shares that benefit neither the corporate value of the target
company nor the common interests of its shareholders: those with a purpose that would obviously harm the corporate value ofthe target company and, in turn, the common interests of its shareholders; those with the potential to substantially coerce
shareholders into selling their shares; those that do not provide sufficient time or information for the target company’s boardof directors and shareholders to consider the terms of the large-scale acquisition of shares, or for the target company’s boardof directors to present a business plan or an alternative proposal; and those that require the target company to discuss ornegotiate with the acquirer in order to procure more favorable terms for shareholders than those presented by the acquirer.
The Company believes that the Persons who control decisions on the Company’s financial and business policies need to be
Persons who (A) fully understand the importance of (i) providing freshness and refreshment to people around the world andembedding the “Coca-Cola” brand, which is now a part of our life style, in local communities; (ii) striving aggressively to win
in the market as the customers’ preferred partner with a deep understanding of the Company’s corporate philosophy; (iii)appreciating employees who have a strong sense of responsibility to thoroughly pursue customer satisfaction, and proactively
working on building a workplace environment that can make each and every employee feel rewarded, motivated and proud of
being a member of the Coca-Cola family; and (iv) contributing to local communities and proactively dealing withenvironmental issues with a strong sense of responsibility as a corporate citizen that continues to strive to assist in therealization of an affluent society, (B) preserve relationships of mutual trust with customers, business partners, shareholders
and employees and perform to their expectations, and (C) make it possible to continually and persistently ensure and enhance
the Company’s corporate value and, in turn, the common interests of its shareholders from a mid- to long-term perspective.
Therefore, the Company believes that Persons who would make a large-scale acquisition of the shares in the Company in amanner that does not contribute to the corporate value of the Company and, in turn, the common interests of its shareholders
would be inappropriate to become Persons who would control decisions on the Company’s financial and business policies.
The Company believes that it is necessary to ensure and enhance the corporate value of the Company and, in turn, thecommon interests of its shareholders by taking the necessary and reasonable countermeasures against a large-scale acquisitionof the shares in the Company by such Persons.

38This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

b. Initiatives to realize the basic policies(a) Summary of special initiatives that contribute to realizing the basic policies
The Group not only assumes a leading role in transforming the Coca-Cola business in Japan by deploying various joint
initiatives such as product development and test marketing with The Coca-Cola Company and Coca-Cola (Japan) Company,
Limited (100% subsidiary of The Coca-Cola Company) as a strategic partner, but also strives to become a company trusted
by the stakeholders of consumers, customers, shareholders and employees.
Soft drink industry volume growth in Japan is expected to be muted, given the developed nature of the market as a whole,and the business environment surrounding the Company is projected to stay competitive as multiple players compete in themarket.
Under such circumstances, the Group aims at becoming the preferred partner of our customers and consumers in all
drinking occasions by establishing a robust and sustainable operating model, pursuing success in high-priority areas, anddrastically transforming the business to ensure growth.
The Company also made a transition to a company with an Audit and Supervisory Committee in order to further reinforce
the governance system. The Audit and Supervisory Committee serves as the auditing body of the Company that is comprised
exclusively of external directors, including multiple independent external directors. To strengthen the management oversightfunction, these external directors that serve as members of the Audit and Supervisory Committee have each been grantedwith a voting right in the Board of Directors meetings, in addition to the right to state their opinions in shareholders’ meetings
on matters pertaining to the designation of board members and their remuneration, among others. In order to separate thedecision-making, business management and business execution functions, the Company is implementing a corporate
executive officer system. In addition to the foregoing, for more fruitful deliberations of highly important matters in the
Board of Directors meetings, the Company is delegating the authority to make decisions on certain important matters that
require prompt business executions to specific directors as well as facilitating speedy decision making of other matters.
(b) Outline of measures to prevent inappropriate Persons from controlling the finance and business policy decisions of theCompany in light of the basic policy
Upon any substantial acquisition of the Company shares, the Company strives to proactively collect and timely disclose
information in order to ensure and improve the corporate value of the Company and the common interest of shareholders
as well as make appropriate measures as needed under the scope permitted by laws and regulations and the Articles ofIncorporation.
When Board Meeting determines it necessary to apply anti-takeover measures in order to ensure and improve thecorporate value of the Company and the common interest of shareholders, taking into consideration of the future trend of
the society, the Company consults with shareholders at the Meeting of Shareholders as stipulated in the Articles ofIncorporation for decision of the implementation.
c. Decisions of the Company’s Board of Directors regarding specific measures and reasons therefor
The measure described in the previous b. (a) was introduced as a specific measure to continuously and sustainably improvethe corporate value of the Company and the common interest of shareholders, and is consistent with the Company’s basic
policy.
In addition, the measure described in the previous b. (b) was introduced as a specific measure to ensure and improve thecorporate value of the Company and the common interest of shareholders as needed under the scope permitted by laws andregulations and the Articles of Incorporation focusing on the intention of shareholders, and it is not intended to undermine theshareholders’ common interests or preserve the positions of the Company officers.

39

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(2) Information about officers
Males: 7 people, Females: 2 people (Ratio of females to total directors: 22.2%)
Position

Name

Date of birth

Brief history

Term of office

Number ofshares held(Thousands ofshares)June 1993 Joined Coca-Cola Leventis
January 2000 Joined Coca-Cola Hellenic Bottling Company S.A
January 2005 General Manager and Administrator in charge ofRomania and Mordovian Republic, Coca-Cola
Hellenic Bottling Company S.A
July 2011
Executive Corporate Officer, Coca-Cola West Co.,Ltd.
March 2012 Representative Director, Coca-Cola West Co., Ltd.
Vice President, Coca-Cola West Co., Ltd.
July 2013
Representative
Calin Dragan
Director,
President

Representative
Director,
Vice
President,
Bjorn Ivar
Chief
Ulgenes
Financial
Officer (Headof FinanceMay 2017
October 24,
1966

Representative Director & President, Coca-Cola
East Japan Co., Ltd.
Regional Director, The Coca-Cola Company
Bottling Investments GroupRegional Director, Coca-Cola Far East Limited

January 2018 President, The Coca-Cola Company Bottling
Investments Group
March 2019 Executive Officer, Vice President, Coca-Cola
Bottlers Japan Holdings Inc.
Executive Officer, Vice President, Coca-Cola
Bottlers Japan Inc.
March 2019 Representative Director, President, Coca-Cola
Bottlers Japan Holdings Inc. (incumbent)
Representative Director, President, Coca-Cola
Bottlers Japan Inc. (incumbent)
January 2022 President
Representative Director, President and CEO,Coca-Cola Bottlers Japan Inc. (incumbent)
July, 1997 Joined The Coca-Cola Company
August 2005 Finance Director North & West Africa Business
Unit, The Coca-Cola Company
May 2008 Finance Director & Executive Assistant to theBusiness Unit President, North & West Africa
Business Unit, The Coca-Cola Company
June 2009 GM Innovation & EA, North & West Africa
Business Unit, The Coca-Cola Company
February
Senior Vice President Finance, The Coca-Cola
2010(Japan) Co., Ltd.
January 2013 Finance Director, Central, East & West Africa
Group, The Coca-Cola Company
April 2016 Deputy Finance Director, Europe, Middle East
&Africa (EMEA) Group, The Coca-Cola
Company
October 2018Senior Executive Officer, Head of Finance, CocaCola Bottlers Japan Holdings Inc.
Senior Executive Officer, Head of Finance, CocaCola Bottlers Japan Inc.
November Representative Director & President, Senior
2018
Executive Officer, Head of Finance, Coca-Cola
Bottlers Japan Sales Support Inc.
April 5, 1968
January 2019 Representative Director & President, Senior
Executive Officer, Head of Finance, Coca-Cola
Bottlers Japan Business Services Inc. (incumbent)
February
Executive Officer, Head of Finance, Coca-Cola
2019
Bottlers Japan Holdings Inc.
Executive Officer, Head of Finance, Coca-Cola
Bottlers Japan Inc.
March 2019 Representative Director, Coca-Cola Bottlers Japan
Holdings Inc. (incumbent)
Vice President, Chief Financial Officer (Head ofFinance, Coca-Cola Bottlers Japan Holdings Inc.
(incumbent)
Representative Director, Coca-Cola Bottlers Japan
Inc. (incumbent)
Vice President, Chief Financial Officer (Head ofFinance, Coca-Cola Bottlers Japan Inc.
December Chairman and Representative Director, Q’SAI
2019
CO., LTD
January 2022 Vice President and Chief Financial Officer (Headof Finance)
Representative Director, Vice President and CFO
of Coca-Cola Bottlers Japan Inc. (incumbent)

40

One yearfrom theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2022

One yearfrom theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2022

5

2

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.
Position

Director

Name

Hiroshi
Yoshioka

Date of birth

Brief history

Term of office

Number ofshares held(Thousands ofshares)

October 26,
1952

April 1975 Joined Japan Radio Co., Ltd.
January 1979 Joined Sony Corporation
October 2001Representative Director and President, Sony
Ericsson Mobile Communications Corporation
April 2003 CVP, Sony Ericsson Mobile Communications
Corporation AB
November Corporate Executive, SVP, Sony Corporation
2005
April 2008 Corporate Executive, EVP, Sony Corporation
April 2009 Executive Deputy President Officer, Sony
Corporation
July 2013
Outside Director, Coca-Cola East Japan Co., Ltd.
April 2017 Outside Director, Coca-Cola Bottlers Japan Inc.
Outside Director, Coca-Cola Bottlers Japan
January 2018 Holdings Inc. (incumbent)

One yearfrom theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2022

2

One yearfrom theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2022－

One yearfrom theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2022－

April 1977

Director

Director

Hiroko Wada

Hirokazu
YamuraJoined Procter & Gamble Sunhome Co., Ltd.

January 1998 Vice President, In charge of Corporate New
Ventures, Asia, The Procter & Gamble Company(U.S.)March 2001 Representative Director & President, Dyson Ltd.
April 2004 Representative Director, President & COO,
Toys”R”Us-Japan, Ltd.
November Representative, Office WaDa (incumbent)
May 4, 1952
2004
May, 2009 Outside Director, Aderans Holdings Co., Ltd.
June 2016 Outside Director, Shimadzu Corporation(incumbent)
March 2019 Outside Director, Coca-Cola Bottlers Japan
Holdings Inc. (incumbent)
March 2019 Outside Director (Audit & Supervisory
Committee member), Unicharm Corporation(incumbent)
October 2006Joined Michinoku Coca-Cola Bottling Co., Ltd

September
28, 1977

February
Director, Michinoku Coca-Cola Bottling Co., Ltd
2009
March 2012 Managing Director, Michinoku
Coca-Cola Bottling Co., Ltd.
March 2013 Senior Managing Director, Michinoku Coca-Cola
Bottling Co., Ltd
March 2014 Representative Director & President, Michinoku
Coca-Cola Bottling Co.,
Ltd. (incumbent)
March 2020 Outside Director, Coca-Cola Bottlers Japan
Holdings Inc. (incumbent)

41This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.
Position

Director(Audit &Supervisory
Committee
member)Name

Irial Finan

Date of birthJune 14,1957

Brief history
October 1984Finance Director, Coca-Cola Bottlers Ireland Ltd.
January 1991 Managing Director, Coca-Cola Bottlers Ulster
Ltd.
June 1995 Managing Director, Coca-Cola Molino Beverages
March 2001 CEO, Coca-Cola HBC SA
August 2004 EVP, The Coca-Cola Company (President,
Bottling Investments)
February
Director, Smurfit Kappa Group Plc (incumbent)
2012
March 2012 Outside Director, Coca-Cola Central Japan
Company, Limited.
July 2013
Outside Director, Coca-Cola East Japan Co., Ltd.
April 2016 Director, Coca-Cola European Partners Plc
Outside Director (Audit & Supervisory
April 2017 Committee member), Coca-Cola Bottlers JapanInc.
January 2018 Outside Director (Audit & Supervisory
Committee member), Coca-Cola Bottlers Japan
Holdings Inc. (incumbent)
February
Director, Fortune Brands Home & Security, Inc.
2019
(incumbent)
December Joined Banco Bradesco SA
1983
January 1985 Senior Manager, Arthur Andersen (Accenture)

Term of office

Number ofshares held(Thousands ofshares)Two years
from theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2021－

March 1996 System Director, Toshiba America Electronic
Components, Inc.
December Solution Service Vice President, i2 Technologies
1997
Japan, Inc.
Director(Audit &Supervisory
Committee
member)

Celso
Guiotoko

January 3,
1959

Two years
from theMay 2004 Vice President & CIO (Chief Information Officer),
Ordinary
Nissan Motor Co., Ltd.
GeneralApril 2006 Corporate Vice President & CIO, Nissan Motor
Meeting ofCo., Ltd.
Shareholders
April 2014 Senior Corporate Vice President & CIO, Nissan
held onMotor Co., Ltd.
March 2021
June 2017 Statutory Auditor, Nissan Motor Co., Ltd.
March 2019 Outside Director (Audit & Supervisory
Committee member), Coca-Cola Bottlers Japan
Holdings Inc. (incumbent)
Executive Officer, Global Chief Digital Officer,
Nishimoto Co., Ltd.
March 2020 Director, Global Chief Digital Officer, NishimotoCo., Ltd. (incumbent)

42－This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.
Position

Name

Date of birth

Brief history

Term of office

Number ofshares held(Thousands ofshares)Two years
from theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2021－

Two years
from theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2021－

July 1992
Joined Lehman Brothers Holdings Inc.
October 1996Vice President, Lehman Brothers Japan Inc.
June 1999
May 2004
Director(Audit &Supervisory
Committee
member)Director(Audit &Supervisory
Committee
member)Nami Hamada

Vamsi Mohan
Thati

August 3,
1964

April 28,
1971,

Senior Vice President, Lehman Brothers JapanInc.
Representative Director, HDH Advisors Japan
Limited.
Principal, HDH Capital Management Pte Ltd.

December
2006
March 2009 Founder, Managing Director, Mile High Capital
Inc. (incumbent)
August 2017 Director, Ecoplexus Japan K. K
February
Chief Operating Officer, Vesper Group Japan K.K.
2019
March 2019 Outside Director (Audit & Supervisory
Committee member), Coca-Cola Bottlers Japan
Holdings Inc. (incumbent)
May 2020 Outside Director (Audit Committee Member),
MetLife Insurance K.K. (incumbent)
June 1994 Joined ASIAN PAINTS (INDIA) LTD.
September Joined The Coca-Cola Company Bottling
1998
Investments Group
April 2009 General Manager, The Coca-Cola Company
Bottling Investments GroupMay 2012 Indochina CEO, The Coca-Cola Company
Bottling Investments Group
June 2016 Southeast Asia Region Director, The Coca-Cola
Company Bottling Investments GroupMay 2017 India and Southwest Asia Region Director, The
Coca-Cola Company Bottling Investments Group
January 2018 President, South Pacific Business Unit, The CocaCola Company
November President, Greater China and Mongolia Operating
2020
Unit, The Coca-Cola Company (incumbent)
March 2021 Outside Director (Audit & Supervisory
Committee member), Coca-Cola Bottlers Japan
Holdings Inc. (incumbent)
Total

9

(NOTE) 1. Hiroshi Yoshioka, Hiroko Wada, Hirokazu Yamura, Irial Finan, Celso Guiotoko, Nami Hamada and Vamsi Mohan Thati
are Outside Directors.
2. The Group has introduced a corporate executive officer system to accelerate the execution of business and clarify
responsibilities. The total number of executive officers is 12, including representative directors.

43

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Information of outside directors
Currently, three of the five directors (excluding directors who are members of the Audit and Supervisory Committee) and all
four directors who are members of the Audit and Supervisory Committee are outside directors.
a. Appointment of outside directors
Category

Name

Relationship with the Company

OutsideDirector

Hiroshi
Yoshioka

OutsideDirector

Hiroko Wada －－Status of appointment
The Company has appointed Hiroshi Yoshioka as a Director (Outside Director) in order for him toutilize, for the management of the Company, the considerable experiences and global knowledge hehas gained thus far at the Coca-Cola bottling company within Japan and Sony Corporation.
There is no relationship of special interest between him and the Company, and no risk that conflictsof interest with general shareholders. Therefore, the Company has designated him as an independent
director.
The Company has appointed Hiroko Wada as a Director (Outside Director) in order for her to utilize,
for the management of the Company, the considerable experiences and global knowledge she has
gained thus far as officer at The Procter & Gamble Company and as Representative Director at
Toys”R”Us Japan Ltd.
There is no relationship of special interest between her and the Company, and no risk that conflictsof interest with general shareholders. Therefore, the Company has designated her as an independent
director.

Hirokazu Yamura is theRepresentative Director and
The Company proposes to appoint Hirokazu Yamura as a Director (Outside Director) in order for
President of Michinoku Cocahim to utilize, for the management of the Company, the considerable experiences and knowledge
Cola Bottling Company, Co., Ltd.
he has gained thus far as the Representative Director and President of Michinoku CCBC.
(hereafter “Michinoku CCBC)”,The Company also has transactions with the group companies of Michinoku CCBC, but thewhich is a trading partner of thetransaction volume is very small. In addition, the trading prices and other terms and conditions
Group. The amount of sale ofOutsideHirokazu
applied to these transactions are fair and consistent with the trading prices and other terms andproducts, etc. to Michinoku
Director
Yamuraconditions applied to transactions with other trading partners. We therefore believe that these group
CCBC is equivalent to 0.5% ofcompanies of Michinoku CCBC pose no risk of obstruction of our free and fair business activities.
the Company’s consolidated net
The Company has designated Hirokazu Yamura as an independent director based on our judgment
revenue, and the amount ofthat the current transactional ties with Michinoku CCBC and its group companies do not have any
purchase of products, etc. fromsignificant impact on our business, and that there is no relationship of special interest between him
Michinoku CCBC is equivalentand the Company, and no risk of causing any conflict of interest with general shareholders.
to 0.2% of the consolidated
revenue of Michinoku CCBC.
Irial Finan has considerable experience and global expertise having acted as a corporate executive
engaged in Coca-Cola business over many years acting as an outside director of Coca-Cola bottlingcompany within Japan, management of The Coca-Cola Company and global bottlers and a
Outsiderepresentative of the Bottling Investments Group engaging in oversight of Coca-Cola bottlers
Director
worldwide, and possesses audit experiences as a Director serving on the Audit and Supervisory(Audit &－Irial Finan
Committee and the Chairperson of such Audit and Supervisory Committee at our Company. Based
Supervisoryon his extensive experience as a global corporate executive and his expertise in the field of Finance,
Committee
he is expected to provide advises as a Director serving on the Audit and Supervisory Committee on
member)all areas including decision making related to important managerial decisions, handling of expectedrisks and the internal control system, and the Company has appointed Finan as a Director servingon the Audit and Supervisory Committee (Outside Director).
Celso Guiotoko has considerable experiences and global expertise gained at Nissan Motor Co., Ltd.
(“Nissan”) as well as Nishimoto Co., Ltd. and possesses audit experience as Statutory Auditor at
OutsideNissan. Based on his extensive experience as a corporate executive and an auditor and his expertise
Directorin the field of information technology, he is expected to provide advice as a Director serving on the(Audit &Celso
Audit and Supervisory Committee on all areas including decision making related to important－
Supervisory Guiotoko
managerial decisions, handling of expected risks and the internal control system, and the Company
Committee
has appointed Guiotoko as a Director serving on the Audit and Supervisory Committee (Outside
member)Director). There is no relationship of special interest between him and the Company, and no riskthat conflicts of interest with general shareholders. Therefore, the Company has designated him as
an independent director.
Nami Hamada has considerable experiences on Finance and Accounting gained as a proprietor ofher own finance consulting company and considerable experiences and global expertise gained as a
Outsidecorporate executive at Lehman Brothers Japan Inc. Based on her extensive experience as a corporate
Director
executive and her expertise in the field of finance, she is expected to provide advice as a Director(Audit &Nami
serving on the Audit and Supervisory Committee on all areas including decision making related to－Supervisory Hamada
important managerial decisions, handling of expected risks and the internal control system, and theCommittee
Company has appointed Hamada as a Director serving on the Audit and Supervisory Committee
member)(Outside Director). There is no relationship of special interest between her and the Company, andno risk that conflicts of interest with general shareholders. Therefore, the Company has designatedher as an independent director.
Vamsi Mohan Thati is President Vamsi Mohan Thati is President of the Greater China and Mongolia Operating Unit at The Cocaof the Greater China andCola Company, who has demonstrated strong leadership in a variety of fields such as operations,
OutsideMongolia Operating Unit at The market execution, and general management at The Coca-Cola Company Bottling Investments
Director
Coca-Cola Company. The
Group and has considerable management experiences as a manager at business units in the Asia
(Audit& Vamsi Mohan Company has entered into
region. Based on his extensive experience as a global corporate executive, he is expected to provide
Supervisory Thati
contracts for manufacturing and advises as a Director serving on the Audit and Supervisory Committee on all areas including
Committee
sales of Coca-Cola and otherdecision making related to important managerial decisions, handling of expected risks and themember)products and use of trademarks, internal control system, and the Company has appointed Thati as a Director serving on the Audit
etc. with The Coca-Colaand Supervisory Committee (Outside Director).
Company.

44

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

b. Criteria or policies for independence when appointing an outside director
We consider our outside director (including candidates) sufficiently independent when all of following criteria are found tobe irrelevant to him/her as a result of our reasonably possible range of investigation:(a) Currently and in the past 10 years, the person works/worked in the Company or its subsidiary.
(b) Currently and in the past one year, the person is/was a major business partner (the Group accounts for 2% or more ofwhose consolidated net sales in the most recent fiscal year) or works/worked in the business partner.
(c) Currently and in the past one year, the person is/was a major business partner (which accounts for 2% or more of ourconsolidated net sales in the most recent fiscal year) or works/worked in the business partner.
(d) Currently and in the past one year, the person is/was a consultant, a certified public accountant, an attorney, or otherreceiving annual compensation of 10 million yen or more from the Company, in addition to officers' compensation.
(e) Currently and in the past one year, the person is/was a recipient of donations of 10 million yen or more per year from theCompany, or works/worked in the recipient entity; and(f) Relatives within the second degree of kinship of those falling under (a) to (e) above.
c. Functions and roles of outside directors in corporate governance
The Audit and Supervisory Committee is composed entirely of outside directors, so that the system to monitor the executionof duties by directors has been established. We receive appropriate advice from outside directors (excluding directors who aremembers of the Audit and Supervisory Committee) who are knowledgeable other than our Group, and outside director who aremembers of the Audit and Supervisory Committee in a third-party perspective.
d. Collaboration of outside directors' supervision or audit with internal audits and external accounting audits, as well as its
relationship with internal control department
Outside directors who are not members of the Audit and Supervisory Committee receive reports and express their opinion oninternal audit, external accounting audit and internal controls at the Board of Directors meetings. Also, outside directors who
are members of the Audit and Supervisory Committee receive reports and express their opinion on them at the meetings ofBoard of Directors and the Audit and Supervisory Committee.
e. Outline of Limited Liability Agreements
In its Articles of Incorporation, the Company has established provisions concerning limited liability agreements with Directors(excluding those who is not an Executive Director, etc.) in order to ensure that Directors (excluding those who is not an
Executive Director, etc.) can demonstrate the roles expected of them and the Company can invite and select competent persons
as Directors (including, not limited to, Outside Directors).
The Company has entered into limited liability agreements with seven Directors to limit their liability for damages in the eventthat he/she fails to perform his/her duties stipulated in Article 427, Paragraph 1 of the Companies Act. The limit of liability in
the Agreement shall be equal to the minimum liability limit stipulated by laws and ordinances.
f. Outline of the Directors’ and officers’ Liability Insurance Policy
In order to ensure that directors (including those who are members of the Audit and Supervisory Committee) and the Group’s
executive officers can demonstrate the roles expected of them and the Company can select competent persons to serve as
directors and executive officers, the Company has entered into a directors' and officers' liability insurance contract stipulated in
Article 430-3, Paragraph 1 of the Companies Act with an insurance company and the Company bears the entire premium.
The policy covers the nine members of the Board of Directors, namely Calin Dragan (Representative Director) Bjorn Ivar
Ulgenes, Hiroshi Yoshioka, Hiroko Wada, Hirokazu Yamura, Irial Finan, Celso Guiotoko, Nami Hamada and Vamsi Mohan
Thati and, as well as the executive officers of the Group, as insured, in the event of claims for damages by shareholders, theCompany, employees or other third parties arising from acts in the course of their duties as directors and officers of the Company
during the term of the policy.
g. Assignment of support staff for outside directors
Outside directors (excluding who are not members of the Audit and Supervisory Committee) are supported by staff from thecorporate governance department, and outside directors who are members of the Audit and Supervisory Committee members
are supported by secretariat of the Audit and Supervisory Committee (assistant employees).

45This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(3) Audit Status
a. Audit and Supervisory Committee Audit Status
The Audit and Supervisory Committee serves as the auditing body of the Company that is comprised exclusively of external
directors, including multiple independent external directors. To strengthen the management oversight function, these external
directors that serve as the member of the Audit and Supervisory Committee have been granted with a voting right in the Boardof Directors meetings, in addition to the right to state their opinions in shareholders’ meetings on matters pertaining to thedesignation of board members and their remuneration, among others.
The four directors who are members of the Audit and Supervisory Committee audit the execution of duties by directors andexecutive officers based on relevant laws and regulations, the Articles of Incorporation, and the audit standards for our Audit
and Supervisory Committee, through periodic meetings with representative directors and reports on the results of audits
conducted by the Audit Office. One of four directors who is a member of the Audit and Supervisory Committee runs a financeconsulting company herself and has extensive experience in finance and accounting, and therefore possesses considerable
knowledge of finance and accounting.
In the current fiscal year, we held the Audit and Supervisory Committee Meetings six times with the following attendance ofeach member.
Name

Number of times held

Number of attendances

Irial Finan

8
8

8
8

8
6

8
5

Celso Guiotoko
Nami Hamada
Vamsi Mohan Thati

Vamsi Mohan Thati was elected at the 63rd Ordinary General Meeting of Shareholders held on March 25, 2021 and attended all

5 out of 6 times of Audit and Supervisory Committee Meetings held after his election in the fiscal year ending 31 December
2021.
Main matters discussed by the Audit and Supervisory Committee include the development of audit policies, confirmationthat the internal control system is put in place and properly operated, preparation of audit reports, reappointment of accounting
auditors, approval regarding the remuneration of accounting auditors, formation of opinions concerning the election andremuneration of directors, etc.
The members of the Audit and Supervisory Committee use their broad knowledge and extensive experience to express
objective audit opinions from an independent and neutral standpoint and to present candid opinions at the Board of Directors
Meetings and Audit and Supervisory Committee Meetings.
b. Internal Audit Status
We have established the Audit Office (16 members) as an internal audit department to ensure compliance with laws andregulations, appropriate activities and operations, protection of assets, and reliability of financial reporting.
As for the annual audit policy and audit plan of the Audit Office, the prior consultation with the Audit and Supervisory
Committee shall be held, and the Audit and Supervisory Committee shall receive reports on the results of audits conducted by
the Audit Office from time to time.
In addition, the Audit and Supervisory Committee and the Audit Office receive explanations of the audit plan from theexternal accounting auditor at the beginning of the fiscal year, and request explanations and reports from time to time regarding
the status of the audit during the fiscal year and the results of year-end audit.
c. Accounting Audit Status(a) Name of audit firm
Ernst & Young ShinNihon LLC(b) Continuous audit period
4 years46

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(c) The certified public accountants who performed the accounting audit
Certified public accountant who performed the accounting audits
Designated Limited

Engagement

Liability Partner

Partner

Designated Limited

Engagement

Liability Partner

Partner

Designated Limited
Liability Partner

Engagement
Partner

Tokuya Takizawa
Miyuki Nakamura
Keita Tsujimoto(d) Composition of assistants involved in audit work
21 certified public accountants and 37 others were involved as audit assistants.
(e) Audit firm selection policy and reasons(Evaluation of the audit firm by Audit & Supervisory Committee)
The Audit and Supervisory Committee evaluates the accounting auditor’s quality control structure, global auditing
system, and appropriateness, independence, etc. of the audit comprehensively, confirms that the audit by Ernst & Young
ShinNihon LLC is appropriate and reasonable, and passes a resolution for its reappointment
In the case that it is determined that the accounting auditor falls under any of the dismissal events listed in the items of
Article 340, Paragraph 1 of the Companies Act, the Audit and Supervisory Committee will remove the accounting auditor
with the consent of all members. In this case, a Committee member selected by the Audit and Supervisory Committee will
disclose the removal and its reason at the Meeting of Shareholders convened for the first time after the removal.
Additionally, concerning dismissal or non-reappointment of the accounting auditor, the Audit and Supervisory
Committee shall decide contents of a proposed resolution they submit to the General Meeting of Shareholders, in the event
they determine that it is necessary to do so in cases such as where the accounting auditor is recognized to have difficulty
in properly fulfilling its auditing duties.
(f) Evaluation of the Accounting Auditor by the Audit and Supervisory Committee
The Audit and Supervisory Committee evaluates the accounting auditor’s quality control structure, global auditing
system, and appropriateness, independence, etc. of the audit comprehensively, confirms that the audit by Ernst & Young
ShinNihon LLC is appropriate and reasonable, and passes a resolution for its reappointment.
(g) Details of remuneration to independent auditors①Compensation for auditing certified public accountants
Previous fiscal year

Current fiscal year

Category

Remuneration for on
audit assurance services(Millions yen)

Remuneration for on
non-audit assurance
services (Millions yen)

Remuneration for on
audit assurance services(Millions yen)

Remuneration for on
non-audit assurance
services (Millions yen)

The Company

75

－

75

－

Consolidated
subsidiaries

125

－

147

－

Total

200

－

222

－

47

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

②Remuneration for organizations belonging to the same network as auditing certified public accountants (excluding ①.)
Not applicable.
Previous fiscal year

Current fiscal year

Category

Remuneration for on
audit assurance services(Millions yen)

Remuneration for on
non-audit assurance
services (Millions yen)

Remuneration for on
audit assurance services(Millions yen)

Remuneration for on
non-audit assurance
services (Millions yen)

The Company

－

－

－

－

－

－

－

2

－

－

－

2

Consolidated
subsidiaries
Total

Non-audit services provided by the same network of certified public accountants (EY Strategy and Consulting Co., Ltd.) as that of theCompany during the fiscal year under review included assistance to consolidated subsidiaries in developing policies and proceduresfor disclosing information on climate change risks.
③Other material remuneration to independent auditors
Previous fiscal year (January 1, 2020 to December 31, 2020) and current fiscal year (January 1, 2021 to December 31,
2021)
Not applicable.
④Details of non-audit services rendered by independent auditors
Previous fiscal year (January 1, 2020 to December 31, 2020)
The Company paid the Accounting Auditor remuneration, etc., for the preparation of comfort letters in connection with
the issuance of corporate bonds in services other than those described in Article 2, Paragraph 1 of the Certified Public
Accountants Act (non-audit services).
Current fiscal year (January 1, 2021 to December 31, 2021)
Not applicable.
⑤Reason for the Audit and Supervisory Committee to Have Agreed the Amount of Renumeration Payable to the Accounting
Auditor, etc.
The Audit and Supervisory Committee confirmed and reviewed the appropriateness and adequacy of the audit plans,
audit hours, implementation status and grounds for the estimate of the remuneration as submitted by the accounting
auditor before granting approval to the remuneration payable to the accounting auditor.
(4) Officer compensation, etc.
①Compensation policy and process for determining the policya. Basic policy on compensation for Executive Directors and Executive Officers(i) Compensation level and structure that enable hiring and retaining high-quality talents from the perspective of diverse
nationalities and experiences.
(ii) Compensation composition ratio emphasizing performance-linked compensation, resulting in providing sufficientincentives for profitable growth.
(iii) Introduce the system to further improve mid- to long-term corporate value, and reinforce alignment of interests with theshareholders.
b. Supervisory Officers (Directors serving on the Audit and Supervisory Committee and Outside Directors not serving on the
Audit and Supervisory Committee)
The compensation level and structure that is appropriate as roles in managerial supervision and audit
c. Process for determining the policy
The policy for determining compensation for Officers, etc. shall be determined upon deliberation by the Audit andSupervisory Committee and approval by the Board of Directors.
The current policy (policy for determining compensation for Directors, etc.) has been resolved by the Board of Directors on
March 25, 2021.

48

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

② Details and procedures on compensation for Executive Directors and Executive Officersa.
Compensation structure

Fixed compensation

Base salary
Retirement
paymentsAnnual bonus







Monthly payment of an amount determined based on responsibilities.
10% of annual base salary is retained, and the accumulated amount iscalculated and paid upon their retirement.
This payment may be reduced or withheld altogether if the recipient hascaused significant damage to the CCBJH Group or been subject todisciplinary action. It may also be specially increased where the recipient
has given particularly distinguished contribution. Any reduction,
withholding, or special increase will be decided at the Board of Directors
Meeting, based on deliberation by the Audit and Supervisory Committee.
Provided at a certain point in the year as an incentive for achieving
performance targets for each fiscal year.
The target amount is set in the range of 30% to 85% of base salary,depending on their responsibilities.
The amount of payment varies in the range of 0% to 150% of the target
amount depending on the achievement of performance targets in eachfiscal year (companywide performance and individual evaluations).
To provide motivation to achieve profitable growth, business income,sales volume, and net sales have been adopted as measures for evaluatingcompanywide performance, based on the Company’s policy regarding thedetermination of compensation, etc. for Directors, etc.

The portion of thecompensation
shown on the left
provided to
Directors will not
exceed thefollowing amount.

Variable compensation

Compensation limit
for Directors(excluding
Directors servingon the Audit andSupervisory
Committee): 850
million yen peryear (approved byresolution no. 5 of2019 Annual
General Meeting of
Shareholders) (fivein number at thetime of theresolution,
excluding Directors
serving on the
Audit andSupervisory
Committee)* In case where the
Audit andSupervisory
Committee hasdeliberated anddeemed itnecessary,
payments within
850 million yen
may be made forfringe benefits suchas housing
allowances, etc.

49

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Long-term incentives(1) PSU(Performance
Share Units)(2) RSU (Restricted
Stock Units)

Two types of stock-based compensation systems, (1) PSU and (2) RSU,
are adopted as long-term incentives.
The basic amount of all long-term incentives (1) PSU + (2) RSU is set in
the range of 15% to 100% of base salary based on the responsibilities.
50% of this basic amount is set as the basic PSU amount, and 50% is set
as the basic RSU amount.
With regard to (2) RSU, additional grants for the purpose of retention,etc. may be made in addition to the above-mentioned basic RSU amountand in case for Directors, up to the compensation limit detailed on theright if deemed necessary by the Audit and Supervisory Committee.
Granted as an incentive for achieving medium to long term performancetargets.
The number of shares to be issued shall be determined within the range
of 0% to 150% of the basic PSU amount depending on the achievementof performance targets (only considering companywide performance)over the three years after the share units have been granted (half of theshares to be issued shall be paid in cash for the purpose of allocating funds
for the payment of tax obligations).
To provide motivation to enhance corporate value over the mid to longterm, consolidated ROE and consolidated sales growth rate have been
adopted as measures for evaluating performance, based on the Company’s
policy regarding the determination of compensation for Directors, etc.
Granted for the purpose of aligning interests with shareholders, creating
incentives to increase corporate value, and strengthening retention oftalented people.
A predetermined number of shares are issued at retirement (half of theshares to be issued shall be paid in cash for the purpose of allocating funds
for the payment of tax obligations).

The portion of thecompensation
shown on the left
provided to
Directors will not
exceed thefollowing amount.
Compensation limit
for Directors(excluding
Directors servingon the Audit andSupervisory
Committee):
Maximum amountof 600,000 shares
per year multipliedby the market value
at the time of issue(approved byresolution no. 4 of2020 Annual
General Meeting of
Shareholders) (fivein number at thetime of theresolution,
excluding Directors
serving on the
Audit andSupervisory
Committee)* Regarding fringe benefits, to support the execution of assignments outside the home country, housing allowances, etc. are provided
in accordance with the internal regulations approved at the Board of Directors Meeting through deliberations by the Audit andSupervisory Committee.

b.

Process for determining compensation
Approval of compensation including the amount of performance-linked compensation for Executive Directors shall bedelegated to a Representative Director (Calin Dragan) upon resolution by the Board of Directors, and the amount shall be
determined by the Representative Director in accordance with the “Policy for Determining Compensation for Directors,etc.” approved by the Board of Directors within the total amount determined by the resolution of the General Meeting of
Shareholders after the terms of compensation are deliberated by the Audit and Supervisory Committee composed solely
of Outside Directors in order to enhance the transparency and objectivity of procedures for determining compensation.
The reason for the delegation is that the Representative Director is deemed appropriate to determine the performance
results of each Director while taking into account the overall performance of the Company. In order for the Representative
Director to exercise such authority appropriately, the decision on this has been made after deliberations by the Audit &Supervisory Committee. The compensation for Executive Officers shall also be determined through deliberations by the
Audit and Supervisory Committee. Therefore, the Board of Directors deems that the content of these compensations is inline with the above decision-making policy.
(a) Activities of the Board of Directors
The Board of Directors' activities concerning the determination of Officer compensation for FY2021 are as follows:(1) Number of meetings of the Board of Directors held over one year from January 2021 to December 2021: 8(2) Main subjects discussed by the Board of Directors concerning Officer compensation and Officer
compensation structure in FY2021:
50

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Payment of leadership award (for March 2021)
Payment of special RSU to Directors

Revision of Officer compensation structurePolicy for determining compensation for Officers, etc.

Report on the number of PSU and RSU units granted to Directors and Executive Officers in 2021
Payment of bonuses for 2019 and long-term incentives for 2018 to Directors and Executive Officers
Handling of taxes imposed on LTI (LTI tax allowance)
FY2021 variable bonus treatment(b) Activities of the Audit & Supervisory Committee
Activities of the Audit & Supervisory Committee concerning the determination of Officer compensation for FY2021
are as follows.
(1) Number of meetings of the Audit and Supervisory Committee held over one year from January 2021 to
December 2021: 8(2) Main subjects discussed by the Audit & Supervisory Committee concerning Officer compensation and Officer
compensation structure in FY2021:

Report on individual performance evaluation of Directors and Executive Officers for 2020
Payment of leadership award (For March 2021)
Payment of special RSU to Directors

Revision of Officer compensation structurePolicy for determining compensation for Directors, etc.
Compensation for Directors serving on the Audit and Supervisory Committee for 2021

Report on the number of PSU and RSU units granted to Directors and Executive Officers for 2021
Objectives setting of Officers for 2021
Validity of stock prices when stock-based compensation is grantedHandling of taxes imposed on LTI (LTI tax allowance)c.

Compensation level
Compensation is decided according to the responsibilities by utilizing data from compensation surveys performed byexternal research organizations and taking into account the level of compensation provided at companies such as
domestic and overseas companies of similar scale in similar industries with the intent to provide a level of compensationthat enables recruitment and retention of talented people who are highly diverse in terms of nationality, experience, etc.

Image of compensation structure (in case of Representative Director & President)③ Guidelines and procedures for determining compensation for Supervisory Officers
The compensation for Supervisory Officers (Directors who are Audit & Supervisory Committee Members and Outside
Directors who are not Audit & Supervisory Committee Members) is composed of basic compensation only in view of theirrole as supervisors and auditors of CCBJI business. Compensation levels are set according to the role of the Director by
utilizing data from compensation surveys performed by external research organizations and taking into account the level of51

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

compensation provided at domestic companies of similar scale.
The individual compensation for Directors serving on the Audit and Supervisory Committee is proposed to the Audit andSupervisory Committee and determined upon consultation with Directors serving on the Audit and Supervisory Committee
within the total amount determined by the resolution of the General Meeting of Shareholders. The compensation for Outside
Directors not serving on the Audit and Supervisory Committee shall be delegated to a Representative Director (Calin Dragan)
upon resolution by the Board of Directors, and the amount shall be determined by the Representative Director in accordancewith the “Policy for Determining Compensation for Directors, etc.” approved by the Board of Directors after the terms ofcompensation are deliberated by the Audit and Supervisory Committee. The reason for delegating these authorities to the
President and Representative Director is that the President and Representative Director is considered to be the most appropriate
person to evaluate the responsibilities of each Director. To ensure that such authority is appropriately exercised by the President
and Representative Director, decisions on the details of compensation for outside directors who are not members of the Audit
and Supervisory Committee are made after deliberation by the Audit and Supervisory Committee. Therefore, the Board of
Directors deems that the content of these remunerations is in line with the above decision-making policy.
④Details of compensation for Officers for FY2021
a.

Total amount of compensation, etc. by position, total amount of compensation, etc. by category and headcount of Officers
Total amount by category of compensation, etc. (million yen)
Total
Headcount of
BasicLong-term
Positioncompensation
Retirement Annual
Other
Officers(people)incentives(million yen) compensation payments
bonus
Note 6:Note 4:Note 5:
Directors (excluding
Directors serving on the
Audit and Supervisory
Committee)

866
(43)

418
(43)

21
(－)

120
(－)

234
(－)

74
(－)

5
(3)

72
(72)

72
(72)

－

－

－

－

(－)

(－)

(－)

(－)

5
(5)

(of which Outside Directors)
Directors (serving on the
Audit and Supervisory
Committee)(of which Outside Directors)

21
120
234
74
Total
937
489
10
(115)
(115)
(8)
(－)
(－)
(－)
(－)
(of which Outside Directors)
Note 1: In accordance with the resolution passed at the 62nd Annual General Meeting of Shareholders held on March 26, 2020, the upper
limit of compensation for Directors (five in number at the time of the resolution, excluding Directors serving on the Audit andSupervisory Committee) shall be 850 million yen per year (of which 50 million yen per year for Outside Directors (two in
number at the time of the resolution); in accordance with the resolution passed at the 58th Annual General Meeting of
Shareholders held on March 23, 2016, the upper limit of compensation for Directors serving on the Audit and Supervisory
Committee (five at the time of the resolution) shall be 100 million yen per year.
Note 2: Above table includes compensation, etc. paid to one Director (serving on the Audit and Supervisory Committee, of which one
Outside Director), who was resigned at the conclusion of the 63rd Annual General Meeting of Shareholders held on March 25,
2021.
Note 3: Separately, in accordance with the resolution taken at the 63rd Annual General Meeting of Shareholders held on March 25, 2021,
for Directors (excluding Directors serving on the Audit and Supervisory Committee), the upper limit of stock-based
compensation consisting of monetary compensation receivables and cash (“PSU” and “RSU”) to Executive Directors shall beannual amount not exceeding in total the value of 600,000 shares multiplied by the market value of the monetary compensation
receivables and cash at the time of issue”
Note 4: Basic compensation includes an amount equivalent to fringe benefits (housing allowances, etc.), etc.
Note 5: Long-term incentives include PSU, RSU and Special RSU.
Note 6: Other is special award (refer to e. Others (b)).

52This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

b.

Total amount of compensation, etc. for those whose total compensation, etc. amounts to 100 million yen or more
Total amount by category of compensation, etc. (million yen)
Total
Company
Positioncompensation
Basic
Long-termcategory
Retirement
AnnualOther(million yen)compensation
incentives
payments
bonus
Note:3
Note:1(Note 2)Name

Calin Dragan
Bjorn Ivar Ulgenes

Representative

FilingDirectorcompany

Representative

FilingDirectorcompany

217

14

83

170

52

536

158

7

37

63

22

287

Note 1: Basic compensation includes an amount equivalent to fringe benefits (housing allowances, etc.), etc.
Note 2: Long-term incentives include PSU, RSU and Special RSU.
Note 3: Other is special award (refer to e. Others (b)).
c.

d.

Significant employee salary received by the officer concurrently serving as an employee
Not applicable
Payment rate, etc. of incentive compensation(a) In alignment with the mid-term management plan and the goal of achieving it, business income, sales volume and net sales
are set as proper performance metrics of Annual Bonus to measure company performance of the Company in the previous years.
Performance is calculated based on predetermined targets and actual achievement, weighted average achievement for FY2021.
However, we were unable to set targets for each index for the current fiscal year, amid the unstable business environment causedby the effects of the COVID-19 pandemic. The individual performance evaluation-based payout rate for Executive Directors
was 70%. Based on the company performance and individual performance evaluation, the Audit and Supervisory Committee
discussed and reviewed the final payout rate (rate of actual annual incentive paid against target payout) for FY2021. As a result,it determined that 70% is reasonable.
(b) PSUs granted in 2019 are subject to a 3-year performance period at 2019-2021. Also assessed using the corporate
performance metrics of consolidated ROE and consolidated sales growth rate. Performance was assessed against predeterminedtargets and actual achievement at 2018-2020, weighted average achievement for 3-year period was -379%.
The payout rate of PSU granted against target value fluctuates between 0 - 150% depending on achievement levels of
performance targets. Based on the above-mentioned result, the payout rate of the PSU (rate of PSU’s granted against target) is0%.
For the 2020 PSU, the payment rate is expected to be 0%, as the challenging business environment is expected to continue in
2022, the final year of the evaluation period. The payout rate of PSU granted in 2021 is calculated based on ROE of the period
under evaluation and the average annual sales growth rate for the period under evaluation.

e.

Others(a) The company, with the aim to reward performance that drives business transformation and to ensure retention, paid a cashbased leadership award in March 2021 with the total amount of 81 million yen according to the amount of contribution.
The Audit and Supervisory Committee discussed and reviewed the appropriateness of the payment of leadership award and has
deemed to be reasonable. The amount of compensation for this leadership award is included in the total amount of compensation,etc. in the details of compensation for directors and corporate auditors in the Annual Securities Report for the previous fiscal
year.
(b) In order to maintain motivation to lead the transformation over the next few years, we will pay a total of 74 million yen in
cash in March 2022 as a special award based on the individual performance evaluation of FY2021.
The Audit and Supervisory Committee discussed and reviewed the appropriateness of the payment of special award, and has
deemed to be reasonable.

53

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(5) The Company's shareholding status① Standards and concept applied to the classification of investment shares
The Company holds shares of other companies (hereafter “investment shares”) either for the purpose of pure investment orother purpose that is strictly not for pure investment, and classifies them separately according to this difference. The sharesclassified as shares for pure investment are held for the purpose of gaining benefit when they are sold at the timing the stock
price fluctuates favorably or when the company that issued the shares pays the dividend to the shareholders. The Company
also holds shares of other companies that are not strictly for pursuing such returns from investment.
② Shareholding status of Coca-Cola Bottlers Japan Inc.
Among the Company and its consolidated subsidiaries, the company that records the largest amount of investment sharesin the balance sheet (the largest shareholding company) is Coca-Cola Bottlers Japan Inc. (hereafter “CCBJI”), and its
shareholding status is as follows:a. Investment shares that are not held for pure investment purpose(a) The policy of shareholding, method of verifying the rationality of holding the shares, and the result of the verificationby the Board of Directors, etc. on the validity of holding the shares of individual company brands
In principle, the Company has a policy of not owning the so-called crossholding shares.
However, there are cases in which the Company acquires and holds such shares to create business opportunities, andmaintain and strengthen its relationships with business partners and local communities. The Company shall evaluate andreport on the cost of holding major cross-shareholdings and the return on investment thereof in Board Meeting, and workon reducing the cross-shareholdings based on such evaluation.
(b) Number of companies and the amount recorded in the balance sheet
Number ofcompanies

Total amount recorded on thebalance sheet (in millions yen)

Unlisted shares stock

116

4,119

Shares other than unlisted
shares56

9,064(Brands that the Company increased the number of shares in this fiscal year)
Number ofcompanies

Total amount spent to increase
the number of shares held (inmillions yen)

Reason for increasing the number of shares

Unlisted shares

－

－

－

Shares other than unlisted
shares18

42

The Company increased the number ofshares of this company brand as it is amember of the shareholding association of
the counterparty company.

(Brands that the Company decreased the number of shares in this fiscal year)
Number ofcompanies

Total amount by selling anddecreasing the number ofshares (in millions yen)

Unlisted shares

2

26

Shares other than unlisted
shares

30

7,449

54

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(c) Information on specified investment shares, the number of shares of each brand of deemed holding shares, amountrecorded in the balance sheet, etc.
Specified investment shares

Brand

Nishi-Nippon
Railroad Co., Ltd.

Central Japan
Railway Company
East Japan Railway
Company

Seven & i Holdings
Co., Ltd.

Current fiscal year

Previous fiscal year

Number of shares

Number of shares

Whether the
Purpose and quantitative effect of holding the shares, andcounterparty
reason for increasing the number of sharescompany is holding
Amount recorded in the Amount recorded in the(Note 1)
the Company’sbalance sheet
balance sheet
shares or not(in million yen)(in million yen)
The Company is holding the shares of this company
400,000
400,000 brand for the purpose of creating new beverage business
opportunities with this company, as well as for the
Yes
1,044
1,218 purpose of building, maintaining or strengthening therelationship with the local economy.
54,10054,100 The Company is holding the shares of this company
brand for the purpose of creating new beverage business No
830
789 opportunities with this company.
115,000
115,000 The Company is holding the shares of this company
brand for the purpose of creating new beverage business No
813
792 opportunities with this company.
The Company is holding the shares of this company
148,010
143,856 brand for the purpose of creating new beverage business
opportunities with this company.
No
The Company increased the number of shares of this748
526 company brand as it is a member of the shareholding
association of the counterparty company.
231,320

231,320746

864

34,08533,968661

579

100,000

100,000

480

625

244,366

244,366477

478

14,084

14,084434

312

111,595

111,391302

377

247,000

247,000

IZUMI Co., Ltd.

Oriental Land Co.,
Ltd.

Japan Airport
Terminal Co., Ltd.
Fuji Co., Ltd.
McDonald's
Corporation

AEON CO., LTD.

Seibu Holdings Inc.
AEON KYUSHUCO., LTD.
Mitsubishi Heavy
Industries, Ltd.
West Japan Railway
Company266

250

116,800

116,800

259

224

90,00090,000239

284

42,00042,000202

227

58,37958,379197

293

Axial Retailing Inc.

The Company is holding the shares of this company
brand for the purpose of creating new beverage business No
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
No
The Company increased the number of shares of thiscompany brand as it is a member of the shareholding
association of the counterparty company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business No
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business Yes
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business No
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
No
The Company increased the number of shares of thiscompany brand as it is a member of the shareholding
association of the counterparty company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business No
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business No
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of building, maintaining orNostrengthening the relationship with the company brand(Note 2)
as an important business partner.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business No
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage businessNo
opportunities with this company.

55

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Brand

OKUWA
Ltd.

Current fiscal year

Previous fiscal year

Number of shares

Number of shares

Amount recorded in
the balance sheet(in million yen)Amount recorded in
the balance sheet(in million yen)

176,887

176,211

Co.,
168

229

KOBE BUSSAN
Co., Ltd.

32,00032,000

143

102

KANSAI FOOD
MARKET LTD.

113,200

113,200

121

136

84,32678,533H2O RETAILIG
Corporation

68

55

Valor Holdings
Co., Ltd.

31,20031,200

67

82

ROYAL
HOLDINGS Co.,Ltd.

31,640662,44060

1,219

17,47917,01860

61

48,10048,10047

47

18,19818,014LIFE
CORPORATIONDAISYOCORPORATION

Bronco Billy Co.,
Ltd.

43

41

21,94020,885

Misumi Co., Ltd.

KeikyuCorporation

Hankyu Hanshin
Holdings, Inc.
UnitedSuper
Market Holdings
Inc.
MINISTOP CO.,
LTD.

40

37

31,52830,5903654

10,80010,80035
32,78037
32,78035

37

23,57023,570

33

33

7,551

7,405

MatsukiyoCocoka
ra & Co.
32

33

Purpose and quantitative effect of holding the shares, andreason for increasing the number of shares(Note 1)

Whether thecounterparty
company is holding
the Company’s
shares or not

The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company increased the number of shares of thiscompany brand as it is a member of the shareholding
association of the counterparty company.

No

The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company increased the number of shares of thiscompany brand as it is a member of the shareholding
association of the counterparty company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company increased the number of shares of thiscompany brand as it is a member of the shareholding
association of the counterparty company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company increased the number of shares of thiscompany brand as it is a member of the shareholding
association of the counterparty company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company increased the number of shares of thiscompany brand as it is a member of the shareholding
association of the counterparty company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company increased the number of shares of thiscompany brand as it is a member of the shareholding
association of the counterparty company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.

No

No

No

No

No

No

No

No

No

No

No

No

The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.

No

The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company increased the number of shares of thiscompany brand as it is a member of the shareholding
association of the counterparty company.

No

56

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.
Current fiscal year

Previous fiscal year

Number of shares
Amount recorded in
the balance sheet(in million yen)

Number of shares
Amount recorded in
the balance sheet(in million yen)

Purpose and quantitative effect of holding the shares, andreason for increasing the number of shares(Note 1)

Daiichi
Kotsu
Sangyo Co., Ltd.

44,00044,000

31

26

YAOKO
LTD.

4,400

4,400

31

32

WDI
Corporation.

16,00016,000

29

23

FukuokaFinancial Group,Inc.

13,882

13,88227

25

GREENLANDRESORTCo.,
Ltd.

64,20064,200

26

28

4,400

4,400

25

27

14,238

14,23823

23

214,851

190,994

The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of building, maintaining or
strengthening the relationship with this company and the
local economy.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company increased the number of shares of thiscompany brand as it is a member of the shareholding
association of the counterparty company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company increased the number of shares of thiscompany brand as it is a member of the shareholding
association of the counterparty company.

Brand

CO.,

Belc CO., LTD.
COLOWIDE
Co., Ltd.

DYNAM JAPANHOLDINGS Co.,Ltd.

POPLAR.
LTD.

22

20

135,842

131,757

CO.,

Mr
Max
Holdings Ltd.

21

52

33,514

31,33320

24

HALOWS CO.,
LTD.

6,000

6,000

17

21

ROUND ONECorporation

12,00012,00016

1150,63050,630

15

15

YAMADAHOLDINGS
CO., LTD.

33,96633,966

13

19

TOKYU
CORPORATION

7,500

7,500

11

11

ATOM
CORPORATION

14,64014,640

11

13

KICHIRIHOLDINGS &Co., Ltd.
MAXVALUNISINIHONN
CO., LTD.

24,00024,000

10

15

3,896

3,896

8

7

Three F Co., Ltd.

The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company increased the number of shares of thiscompany brand as it is a member of the shareholding
association of the counterparty company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business
opportunities with this company.

57

Whether thecounterparty
company is holding
the Company’s
shares or not
Yes

No

No

No
(Note 2)

No

No

No

No

No

No

No

No

No

No

No

No

No

No

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.
Whether theCurrent fiscal year
Previous fiscal year
counterparty
Purpose and quantitative effect of holding the shares, andNumber of shares
Number of sharescompany is
Brandreason for increasing the number of shares
Amount recorded in the Amount recorded in theholding the(Note 1)balance sheet
balance sheet
Company’s(in million yen)(in million yen)shares or not
The Company is holding the shares of this company
2,000
2,000
KAWACHIbrand for the purpose of creating new beverage businessNo
LIMITED
4
6
opportunities with this company.
RETAILThe Company is holding the shares of this company
3,000
50,005PARTNERS
brand for the purpose of creating new beverage businessNo
473CO., LTD.
opportunities with this company.
KANThe Company is holding the shares of this company
8,000
8,000
NANMARU
brand for the purpose of creating new beverage business
No
4
6
CORPORATION
opportunities with this company.
The Company is holding the shares of this company
1,000
1,000
Maruyoshi
brand for the purpose of creating new beverage business
No
Center Inc.
3
3
opportunities with this company.
The Company is holding the shares of this company
715
715
Maxvalu Tokai
brand for the purpose of creating new beverage businessNoCo., Ltd.
22
opportunities with this company.
Shin-Keisei
The Company is holding the shares of this company
871
871
Electric Railway
brand for the purpose of creating new beverage businessNo22Co., Ltd.
opportunities with this company.
SUGI
The Company is holding the shares of this company
52
52
HOLDINGS Co.,brand for the purpose of creating new beverage business
No
0
0
LTD.
opportunities with this company.
Kyusyu Electric
The Company is holding the shares of this company
365
365
Power Company,
brand for the purpose of creating new beverage business
No
0
0
Inc
opportunities with this company.
The Company has been holding the shares of this
3,432,862
company brand for the purpose of building, maintaining
RICOH Co., Ltd.
and strengthening the relationship with the company
Nobrand as an important business partner, but sold all of
2,324
these shares in 2021.
The Company has been holding the shares of this716,420
Mitsubishi UFJ
company brand for the purpose of building, maintaining
Financial Group,and strengthening the relationship with the company
No
Inc.
brand
as
an
importantbusiness
partner,
but
sold
all
of
327
these shares in 2021.
KYUSHUThe Company has been holding the shares of this
500,000
LEASING
company brand for the purpose of building, maintainingNo
SERVICE CO.,or strengthening the relationship with the local economy,306
LTD.
but sold all of these shares in 2021.
The Company has been holding the shares of this118,261
PLENUS
Co.,
company brand for the purpose of creating new beverageNoLtd.
business opportunities with this company, but sold all of
206
these shares in 2021.
The Company has been holding the shares of this103,400
YONDOSHI
company brand for the purpose of building, maintaining
No
HOLDINGS
and strengthening the relationship with the company(Note 2)INC.
brand as an important business partner, but sold all of
206
these shares in 2021.
The Company has been holding the shares of this146,200
Fujio
Foodcompany brand for the purpose of creating new beverage
No
System Co., Ltd.
business opportunities with this company, but sold all of
184
these shares in 2021.
The Company has been holding the shares of this99,445
Nishikawa
company brand for the purpose of building, maintaining
No
Rubber Co., Ltd.
or strengthening the relationship with the local economy,154
but sold all of these shares in 2021.
The Company has been holding the shares of thisNishi-Nippon
company brand for the purpose of building, maintaining
220,800
No
Financialand strengthening the relationship with the company(Note 2)
Holdings, Inc.
brand as an important business partner, but sold all of
146
these shares in 2021.
The Company has been holding the shares of this
55,300ZENRIN CO.,company brand for the purpose of building, maintainingNoLTD.
or strengthening the relationship with the local economy,70
but sold all of these shares in 2021.

58

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.
Whether theCurrent fiscal year
Previous fiscal year
counterparty
Purpose and quantitative effect of holding the shares, andNumber of shares
Number of sharescompany is
Brandreason for increasing the number of shares
Amount recorded in
Amount recorded inholding the(Note 1)the balance sheet
the balance sheet
Company’s(in million yen)(in million yen)shares or not
The Company has been holding the shares of this
24,000
Amiyaki Tei Co.,
company brand for the purpose of creating new beverageNoLtd.
business opportunities with this company, but sold all of
69
these shares in 2021.
The Company has been holding the shares of this
37,972company brand for the purpose of building, maintaining
The Hyakujushi
and strengthening the relationship with the company
No
Bank, Limited
brand as an important business partner, but sold all of
56
these shares in 2021.
The Company has been holding the shares of this
60,000company brand for the purpose of building, maintaining
Rengo Co., Ltd.
and strengthening the relationship with the company
Yesbrand as an important business partner, but sold all of
52
these shares in 2021.
The Company has been holding the shares of this
26,768
Yoshinoyacompany brand for the purpose of creating new beverage
holdings
Co.,No
business opportunities with this company, but sold all ofLtd.
51
these shares in 2021.
The Company has been holding the shares of this
32,400Torikizoku co.,company brand for the purpose of creating new beverageNoltd.
business opportunities with this company, but sold all of
47
these shares in 2021.
The Company has been holding the shares of this
33,023
ASAHI KASEI
company brand for the purpose of creating new beverage
No
Corporation
business opportunities with this company, but sold all of
35
these shares in 2021.
The Company has been holding the shares of this
33,333company brand for the purpose of building, maintaining
Oji
Holdings
and strengthening the relationship with the company
Yes
Corporation
brand as an important business partner, but sold all of
20
these shares in 2021.
The Company has been holding the shares of this
11,440company brand for the purpose of building, maintaining
Nissha Co., Ltd
and strengthening the relationship with the company
Nobrand as an important business partner, but sold all of
17
these shares in 2021.

(Note) 1. The results of the assessment of the quantitative effect of holding the shares of individual company brands are omitted
from this document for the purpose of maintaining confidentiality. The Company, however, is regularly verifying theeffect of holding these shares from the standpoint of business interests and costs, etc.
2. The company that issued the shares held by the Company does not cross-hold the Company’s shares, but its subsidiarycompany is holding the Company’s shares.
3. “－” means that the Company does not hold any shares of the brand indicated by this mark.
Deemed holding shares
No shares fall under this category.
b. Investment shares held for the purpose of pure investment
No shares fall under this category.
c Investment shares initially held for the purpose of pure investment that the Company changed to investment shares held not
for the purpose of pure investment during this fiscal year
No shares fall under this category.
d Investment shares initially held not for the purpose of pure investment that the Company changed to investment shares held
for the purpose of pure investment during this fiscal year
No shares fall under this category.

59

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

V. Accounting ininformation
1. Preparation of consolidated financial statements and financial statements(1) The Group’s consolidated financial statements has been prepared in accordance with IFRS pursuant to the provisions of Article
93 of the "Ordinance on Terminology, Forms and Preparation Methods of Consolidated Financial Statements" (Ordinance of the
Ministry of Finance No. 28 of 1976; hereinafter referred to as the "Ordinance on Consolidated Financial Statements").
(2) The Company’s financial statements have been prepared in accordance with the "Regulations on Terminology, Forms andPreparation Methods of Financial Statements" (Ordinance of the Ministry of Finance No. 59 of 1963; hereinafter referred to as
the "Ordinance on Financial Statements").
The Company qualifies as a company submitting special financial statements and prepares the financial statements inaccordance with the provisions of Article 127 of the Ordinance on Financial Statements, etc.

2. Note on independent audit
The Company has been audited by Ernst & Young ShinNihon LLC for the consolidated financial statements and the financial
statements as of and for the year ended December 31, 2021 pursuant to the provisions of Article 193-2, Paragraph 1 of the Financial
Instruments and Exchange Act.

3. Remarkable efforts to ensure for presentation of consolidated financial statements, etc. and the establishment ofstructures to appropriately prepare consolidated financial statements, etc. in accordance with IFRSThe Company has been continuing special efforts to ensure the appropriateness of consolidated financial statements and theestablishment of a system to appropriately prepare consolidated financial statements based on IFRS. The details are as follows:(1) In order to properly understand the contents of accounting standards and to establish structures that can respond to changes inaccounting standards, the Company has become a member of the Financial Accounting Standards Foundation and actively
participated in training sessions held by the bodies that set accounting standards.
(2) With respect to the adoption of IFRS, the Company has obtained from time to time press releases and statements issued by theInternational Accounting Standards Board and ascertained the current standards.

60This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

1. Consolidated financial statements(1) Consolidated financial statements① Consolidated statement of financial position(Millions of yen)
Notes

Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

AssetsCurrent assets
Cash and cash equivalents

6,31

114,778

110,497

Trade and other receivables
Inventories

7,31
8

96,00968,180105,320
67,583

Other financial assets
Other current assets

31
13

702
17,195

1,320
16,275

296,865

300,995

48,138－296,865

300,995

10
10,17

460,50229,810434,994
25,144

11

66,193

66,219287

281

Subtotal
Assets of disposal groups classified as held
for sale
Total current assets
Non-current assets
Property, plant and equipment
Right-of-use assets
Intangible assets

9

Investments accounted for using the equity
methodOther financial assets

31

25,64019,511

Deferred tax assets

28

4,986

13,960

Other non-current assets

13

7,183

6,006

594,601

566,116

939,603

867,111

Total non-current assets
Total assets

61

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(Millions of yen)
Notes

Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

Liabilities and equity
Liabilities
Current liabilities:
Trade and other payables

14,31

102,480

103,260

Bonds and debts

16,31

51,07230,990

Lease liabilities

17,31

5,547

Other financial liabilities

31

408
3,238

4,050
－

15
19

9
15,923

916,085

178,676

155,535

7,193－

178,676

155,535

16,31
17,31

187,51425,85831
18605
14,876

156,622
22,462－

Income taxes payable
Provisions
Other current liabilities
Subtotal
Liabilities directly associated with assets
held for sale
Total current liabilities
Non-current liabilities:
Bonds and debts
Lease liabilities
Other non-current financial liabilities
Net defined benefit liabilities
Provisions

9

1,139

17,605

15

2,119

2,137

Deferred tax liabilities28

17,296

17,379Other non-current liabilities

19

Total non-current liabilities
Total liabilities

3,375

2,920

251,641

219,125

437,510374,660

EquityCapital stock
Capital surplus

20
20

15,232450,605

15,232450,832

Retained earnings
Treasury stock20
20

120,473(85,654)

109,273(85,661)

Accumulated other comprehensive income
Accumulated other comprehensive income

20

1,095

2,644

(107)

－

501,643492,320of disposal groups classified as held for sale
Equity attributable to owners of the parent
Non-controlling interests
Total equity
Total liabilities and equity

62

450

131

502,093492,451

939,603

867,111

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

②【Consolidated statements of profit or loss】(Millions of yen)
Notes

Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

Continuing operations
Revenue
Cost of sales

5,23

Gross profit

791,956
429,040

785,837
435,332

362,916

350,505

359,645

363,750

Other income

24
26

8,486

10,138Other expenses

26

23,23517,702

(245)

(162)

Operating loss
Financial revenue

27(11,722)767(20,971)
377

Finance costs

27

1,110

1,089

(12,065)(21,683)(4,918)(6,653)(7,148)(15,029)

2,418

12,505Net loss for the year

(4,729)(2,525)

Net income (loss) for the year attributable to
Owners of parent
Loss from continuing operations attributableto owners of parent(7,130)(15,008)

2,415

12,505

Non-controlling interests

(14)

(21)

Earnings (loss) per share (yen)Continuing operations(39.76)(83.68)Discontinued operations
Loss per share

13.47(26.29)69.72(13.96)

Selling and general administrative expenses

Investment loss on equity method

Loss for the year before income taxes
Income tax expense

28

Net loss for the year from continuing
operations
Discontinued operations
Net income for the year from discontinued
operations

9

Profit from discontinued operations
attributable to owners of parent

35

63This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

③ 【Consolidated statements of comprehensive income】(Millions of yen)
Notes

Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Net loss for the year

Current fiscal year
(From January 1, 2021
to December 31, 2021)(4,729)(2,525)

7,662

(395)

Share of other comprehensive income of equity
method investees

－

(12)

Net change in financial assets measured at fairvalue through other comprehensive income(3,003)854

Subtotal

4,659

448

(2,157)

2,836

Subtotal
Total other comprehensive income (loss) for theyear(2,157)

2,836

2,502

3,283

Total comprehensive income (loss) for the year

(2,228)759(2,214)

780

(14)

(21)

Other comprehensive income

29

Items that will not be reclassified subsequently toincome or loss:
Remeasurements of defined benefit plans

Items that may be reclassified subsequently toincome or loss:
Cash flow hedges

Comprehensive income (loss) attributable to:
Owners of parent
Non-controlling interests

64This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

④ 【Consolidation statements of changes in equity】
For the year ended December 31, 2020
(Millions of yen)

Note
Balance as of January 1, 2020
Comprehensive income forthe year
Net loss for the year
Other comprehensive
income (loss)
Total comprehensive income(loss) for the year
Transactions with owners,
etc.
Dividends of surplus
Purchase of treasury stock
Disposal of treasury stock
Transactions of sharebased payment

Capitalstock
15,232Equity attributable to owners of the parent company
Accumulated otherAccumulatedcomprehensive
otherincome of disposal
Share Retained Treasury comprehensive groups classified aspremium earnings Sharesincomeheld for sale
Total
450,526 121,372 (85,649)
4,517－ 505,999

Noncontrollinginterests
492

Total
506,491－－(4,715)－－－(4,715)(14)(4,729)

－

－

－

－

2,502

－

2,502

－

2,502

－

－

(4,715)

－

2,502

－

(2,214)(14)(2,228)

22
20
20

－
－
－

－
－
(1)

(4,484)
－
－

－
(8)
3

－
－
－

－
－
－

(4,484)
(8)
2

(28)
－
－

(4,512)
(8)
2

21

－

80

－

－

－

－

80

－

80

Reclassification fromaccumulated othercomprehensive income toretained earnings

20

－

－

8,300

－

(8,300)

－

－

－

－

Reclassification fromaccumulated othercomprehensive income tonon-financial assets

20

－

－

－

－

2,268

－

2,268

－

2,268

－

－

－

－

107

(107)

－

－

－

－

79

3,816

(5)

(5,924)(107)(2,142)(28)(2,170)15,232450,605

120,473(85,654)

1,095

(107)

501,643450

502,093

Transfer to accumulated
other comprehensive
income of disposal groups
classified as for sale
Total transactions withowners etc.
Balance as of December 31,
2020

65

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

For the year ended December 31, 2020
(Millions of yen)

Note
Balance as of January 1, 2021
(Before restatement)
Comprehensive income forthe year
Net income (loss) for theyear
Other comprehensive
income (loss)
Total comprehensive income(loss) for the year
Transactions with owners,
etc.
Dividends of surplus
22

Capitalstock

Equity attributable to owners of the parent company
Accumulated otherAccumulatedcomprehensive
otherincome of disposal
Share Retained Treasury comprehensive groups classified aspremium earnings sharesincomeheld for sale

15,232450,605

120,473(85,654)

1,095

－

－

(2,503)

－

－

－

－

－

－

－

－

(2,503)

Total

Noncontrollinginterests

Total(107) 501,643

450

502,093－(2,503)(21)(2,525)

3,283

－

3,283

－

3,283

－

3,283

－

780

(21)

759

－

－

(8,967)－－－(8,967)－(8,967)Purchase of treasury stock

20

－

－

－

(8)

－

－

(8)

－

(8)

Disposal of treasury stock

20

－

(0)

－

1

－

－

0

－

0

Transactions of sharebased payment

21

－

227

－

－

－

－

227

－

227

Reclassification fromaccumulated othercomprehensive income toretained earnings

20

－

－

378

－

(378)

－

－

－

－

Reclassification fromaccumulated othercomprehensive income tonon-financial assets

20

－

－

－

－

(1,356)－(1,356)－(1,356)

－

－

－

－

－

－

－

－

－

－

227

(8,697)(7)(1,734)

107(10,103)

15,232450,832

109,273(85,661)2,644Transfer to accumulated
other comprehensive
income of disposal groups
classified as for sale
Total transactions withowners, etc.
Balance as of December 31,
2021

66

－ 492,320(297) (10,400)
131

492,451

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

⑤ 【Consolidated statements of cash flows】
For the year ended
December 31, 2020

(Millions of yen)
For the year ended
December 31, 2021

Cash flows from operating activities
Loss for the year before income taxes from continuing
operations
Income for the year before income taxes from discontinued
operations
Adjustments for:
Depreciation and amortization
Impairment loss
Gain on sales of subsidiaries’ stock
Gain on sales of stocks of subsidiaries and affiliates
Change in allowance for doubtful accounts
Interest and dividends income
Interest expenses
Investment loss on equity method
Gain on sale of property, plant and equipment
Loss on disposal and sale of property, plant and equipment
and intangible assets
Decrease (increase) in trade and other receivables
Decrease (increase) in inventories
Decrease (increase) in other assets
Increase in trade and other payables
Increase (decrease) in net defined benefit liabilities
Increase (decrease) in other liabilities
Other operating activities
SubtotalInterest received
Dividends received
Interest paid
Income taxes paid
Income taxes refund

12
9
26

Net cash provided by operating activities
Cash flows from investing activities
Acquisitions of property, plant and equipment andintangible assets
Proceeds from sales of property, plant and equipment andintangible assets
Proceeds from collection of loans receivable resulting fromsales of stock in subsidiaries
Purchases of other financial assets
Proceeds from sale of other financial assets
Proceeds from sale of stock of subsidiaries
Other investing activities
Net cash used in investing activities

67

10

9

9

(12,065)(21,683)

3,545

12,841

59,583
1,057
－
－
88
(432)
1,095
245
(5,201)

57,160744(12,841)
(708)
235
(261)
928
162
(1,519)

3,728

1,604

1,043
3,909
(5,196)(9,277)2,038(1,904)318
42,5730431(945)(6,022)
7,678(9,320)
597
3,568
9,426
2,126
749
(74)
43,7351
259(844)(10,122)
2,953

43,71635,982(67,565)(39,263)

12,325

4,377

－

7,400

(55)
3,237
－
(17)

(53)
7,614
34,490705(52,076)

15,271This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(Millions of yen)
For the year ended
December 31, 2020
Cash flows from financing activities
Increase (decrease) in short-term loans payable
Repayments of long-term loans payable
Bond redemption
Dividends paid
Dividends paid to non-controlling interests
Proceeds from disposal of treasury stock
Purchases of treasury stock
Repayments of lease liabilities

30

50,000(1,274)(16,000)(4,484)(28)
2(8)(7,296)(50,000)(1,072)－(8,967)－0(8)(7,088)(67,134)(15,881)
126,378

6

20,912
12,553
113,825
126,378

30
30
30
22

Net cash (used in) provided by financing activities
Net (decrease) increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year68

For the year ended
December 31, 2021

110,497

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

【Notes to consolidated financial statements】
1. Introduction of reporting company
The Company is a holding company domiciled in Japan and is listed on the First Section of the Tokyo Stock Exchange.
Under the Coca-Cola brand, the Company and its subsidiaries (collectively, the "Group") engage in purchases, sales,bottling, packaging, distribution and marketing of carbonated beverages, coffee beverages, tea-based beverages, mineralwater and other soft drinks in Japan. The Group also develops, manufactures and sells a variety of healthcare products.
Between 1999 and 2017, we have integrated our operations with five Coca-Cola bottlers, and became a Coca-Cola bottler
with a business covering approximately 45 million people in 22 prefectures in the Kinki, Chugoku, Shikoku and Kyushu
regions. In April 2017, the Company entered into a share exchange contract whereby Coca-Cola West Co., Ltd. became
the sole parent company and Coca-Cola East Japan Co., Ltd. became a wholly-owned subsidiary. Coca-Cola West Co.,
Ltd. changed its trade name to Coca-Cola Bottlers Japan Inc., and its entire business, excluding the group operational
management business and assets management business, was inherited by its wholly-owned subsidiary “New CCW
Establishment Preparation Company Co., Ltd.” (whose trade name changed to Coca-Cola West Co., Ltd.), and Coca-Cola
West Co., Ltd. had its corporate form transferred to a holding company. In January 2018, Coca-Cola Bottlers Japan Inc.
was renamed Coca-Cola Bottlers Japan Holdings Inc. to clarify its role as a holding company.
The Group’s consolidated financial statements consists of the Company, subsidiaries and associates. The consolidated
financial statements were approved by our Representative Director & President, Calin Dragan and our Representative
Director Vice President and Chief Financial Officer (Treasurer), Bjorn Ivar Ulgenes on March 25, 2022 and are considering
the events after the reporting period to that date (see notes 37, "events after the reporting period").
2. Basis of preparation(1) Framework for application of financial reporting
The Group’s consolidated financial statements have been prepared in accordance with the IFRS established byInternational Accounting Standards Board. The Group meets all of the requirements of a designated international
accounting standard specified company as set forth in Article 1-2 of the consolidated financial statements Regulations,so the provisions of Article 93 of the said Regulations are applied.
(2) Measurement basis
Consolidated financial statements has been prepared on the basis of cost except for measurement at fair value such as
financial instruments described in notes 3, "Significant accounting policies."(3) Functional currency and presentation currency
Consolidated financial statements are stated in Japanese yen, the currency of the Company's principal economic
environment ("functional currency"). All consolidated financial information is rounded to the nearest million yen unlessotherwise stated.
3. Significant accounting policies
The significant accounting policies and the basis of measurement used by the Group for the preparation of theconsolidated financial statements is as follows: Unless otherwise indicated, these accounting policies are applied
continuously for all reporting periods presented.
(1) The basis of consolidation(a) Subsidiary
Consolidated financial statements consists of the financial statements of the Company and companies controlled by
the Company's groups ("subsidiary"). The Group controls an investee when the Group has power over the investee,
has exposure or rights to change returns arising from its involvement with the investee, and has the ability to affectthose returns through its power in the investee. If any of these events or changes in the environment occur, the Company
reassesses the control of the investee.
Subsidiary's financial statements are included within the scope of consolidation from the date the Company acquired
control of subsidiary and are excluded from the scope of consolidation on the date the Company loses control.
Non-controlling interest of subsidiary’s income and share are presented in "non-controlling interest" in the
consolidated statements of profit or loss and the consolidated statements of financial position.
Transactions with non-controlling interest that do not involve a loss of our control are accounted for as equity
transactions. The difference between the fair value of consideration paid and the amount equivalent to the acquisition
or loss equity in the carrying amount of subsidiary's net assets is recognized in equity. If the Group loses control of thesubsidiary, the remaining interest in the entity is remeasurement at the fair value of the date of loss of control, and allchanges in carrying amount are recognized in profit or loss.
69

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

All intercompany transactions, outstanding and unrealized gains have been eliminated in consolidation. Unrealized
losses are also eliminated unless there is evidence that the related asset has been impaired.
(b) Investment in associate accounted for using equity method
Associate is a company that is not controlled by parent but has a significant influence. Normally, an investee's interestof 20% to 50% of the voting rights (directly or indirectly) is considered to be influential.
In consolidated financial statements, investments in associate are accounted for using the equity method. Under
equity method, investments in associate are initially recognized at cost, and subsequently, the Group's share of profit
or loss after the associate share acquisition is recognized in profit or loss, while changes in the Group's share of
associate's other comprehensive income are recognized in other comprehensive income. Dividends income ordividends receivable from associate is deducted from carrying amount of its investments. To the extent that the Group’s
interest in associate is equal to or exceeds the initial investment including long-term receivables, companies do notrecognize any further losses unless a liability arises, or the Group pays on behalf of other companies.
Unrealized gains on transactions between the Group and associate are eliminated to the extent of the interest in
associate. Unrealized losses are also eliminated unless there is evidence that the related asset has been impaired.
The impairment loss related to investments in associate is measured by comparing the recoverable amount withcarrying amount-of investments. Impairment loss is recognized in profit or loss and reversed if there are changes in theassumptions used to determine the recoverable amount of investments.
(2) Business Combination
Business combination is accounted for using the acquisition method. Acquisition date is the date of acquisition ofcontrol of acquiree. The consideration paid for the acquisition was determined on acquisition date as the sum of the asset
transferred in exchange for control of acquiree, the liability assumed and the fair value of the acquisition date of equity
instrument issued by the Company. Other acquisition-related costs, such as brokerage commissions, legal fees, due
diligence and other professional compensation, do not constitute consideration of business combination and are expensed
in the consolidated statements of profit or loss as incurred.
For each business combination, the Group recognizes non-controlling interest of acquiree in either fair value or a
proportionate share of acquiree's identifiable net assets. If the sum of the consideration transferred, the non-controllinginterest of acquiree and the fair value in the acquisition date of the previously owned equity interest in acquiree exceeds
the fair value of identifiable net assets, the difference is recognized as goodwill in assets. If the sum of the considerationtransferred, the non-controlling interest of acquiree, and the fair value in the acquisition date of the previously held equity
interest in acquiree is less than the net assets of the acquired subsidiary, the difference is immediately recognized in the
consolidated statements of profit or loss as a gain on negative goodwill.
(3) Foreign currency translation
Foreign currency transaction is translated into the work functional currency of each group company at the exchange
rate of the transaction date.
Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency of eachcompanies at the exchange rate of the reporting date. Non-monetary assets and liabilities denominated in foreign
currencies for measurement in fair value are translated at the exchange rate on the date determined by fair value. Nonmonetary items denominated in foreign currencies and measured at cost are translated at the exchange rate of thetransaction date. Foreign currency translation gains and losses are recognized in profit or loss.
(4) Business segments infomation
Operating segment is reported in a manner consistent with the internal reporting presented to the chief operating
decision maker. The chief operating decision maker is responsible for allocating resources and evaluating the performanceof the operating segment. The Board of Directors is positioned as the chief operating decision maker in the Group.
(5) Cash and cash equivalents
Cash and cash equivalents consist of cash, demand deposits, and short-term investments with a maturity of threemonths or less from acquisition date, which are readily convertible into cash and bear insignificant risks of changes invalue.

70

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(6) Inventories
Inventories is measured at the lower of cost and net realizable value. Discounts, rebates, other similar items and interest
rates until the par value is reached are deducted from its cost. Manufacturing costs include direct materials, direct laborand manufacturing overhead. Net realizable value is calculated at estimated selling prices less estimated selling costs andestimated selling expenses.
The Group typically calculates the cost of inventories based on the weighted-average method. If the net realizablevalue of inventories is less than its cost, the difference is recognized as expense in the consolidated statements of profit
or loss.
(7) Assets held for sale and discontinued operations
Non-current assets or discontinued groups whose carrying amount will be recovered primarily through a saletransaction, rather than through continuous use, are classified as held for sale. To be classified as held for sale, a company
must be available for immediate sale in its current state and the probability of such a sale must be very high, provided
that the Group’s management is committed to implementing the sale plan and that the sale is generally expected to becompleted within one year. Once classified as held for sale, they are measured at the lower of carrying amount or fairvalue less costs to sell and are not depreciated or amortized
Discontinued operations include those components of an entity that have been disposed of or classified as held for sale,and are classified as such if they comprise one of the Group’s businesses or geographical areas and there are plans todispose of that one business or geographical area.
(8) Property, plant and equipment
After initial recognition, property, plant and equipment is measured at cost less accumulated depreciation andimpairment losses. Expenditures incurred to expand, improve, or improve asset productivity, allowances or efficiencies,
or to extend the useful life of an asset are included in cost of the related asset as capital expenditures, while repairs andadministrative expenses are recognized as expenses when incurred.
Depreciable amount is the cost of asset less estimated residual value. Depreciation is principally calculated using thestraight-line method over the estimated useful life for each item of property, plant and equipment as follows:
Estimated useful life (Years)
Buildings and structures

2 - 60Machinery and vehicles
Sales equipment

3 - 202-9Depreciation methods, estimated useful life, and estimated residual values are reviewed at the end of each fiscal year,
and any changes are applied prospectively as a change in accounting estimate. Land and construction in progress are notdepreciated.
Gains and losses from the sale or disposal of asset are measured as the difference between carrying amount and salevalue in "Other income" or "Other expense" in the consolidated statements of profit or loss.
(9) Goodwill
Goodwill generated by business combination is not amortized but is measured at cost less accumulated impairment
losses after initial recognition. Goodwill annually also tests for impairment whenever events or changes in circumstancesindicate a potential impairment may occur.
To test for impairment, the goodwill generated by the business combination is allocated to the respective cashgenerating unit or cash-generating unit group that are expected to benefit from business combination synergies. Cashgenerating unit is the smallest identifiable group of assets that generates cash inflows independently. The cash-generating
unit or cash-generating unit group to which goodwill is allocated are the smallest levels within the enterprise where thegoodwill is monitored for internal control purposes.
If the recoverable amount of a cash-generating unit or cash-generating unit group is less than it carrying amount as aresult of the impairment test, the difference is recognized as an impairment loss. Impairment loss first reduces the carrying
amount of the goodwill allocated to the cash-generating unit or cash-generating unit group, and then allocates and reduces
it to asset other than the goodwill on a pro rata basis based on the carrying amount of each asset within the cash-generating
unit or cash-generating unit group. Impairment loss for goodwill has not been reversed in recognized in reporting periods
after it is recognized.
71

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(10) Intangible assets
Intangible asset is an identifiable non-monetary asset that does not have any physical reality to provide economic
benefits in the future. Intangible asset is initially recognized at cost or manufacturing cost. Subsequent to initialrecognition, intangible asset is measured at cost less accumulated amortization and impairment losses. The Groupevaluates intangible asset's useful life to determine whether it is finite or indefinite and, if it is finite, evaluates useful life
based on the expected usable period.
Intangible asset acquired separately is initially measured at cost. If the intangible asset acquired from businesscombination meets the definition of intangible asset, is identifiable, and the fair value can measure reliably, it is identified
separately from the goodwill and measured at the fair value of the acquisition date. Expenditures incurred in acquiring
software are recognized as an intangible asset. Development cost of internally produced software is recognized as anintangible asset when it is technically feasible and is more likely than not that the software will benefit in the future.
The principal intangible asset with finite useful life is software, and amortization is calculated using the straight-line
method over the estimated useful life (5-10 years).
Amortization method, estimated useful life, and estimated residual value are reviewed at the end of each fiscal year
and applied prospectively as a change in accounting estimate in the event of any change.
Contract related intangible asset
In connection with the acquisition of the former Coca-Cola East Japan Co., Ltd., the Group's contract related intangible
asset is concluded with The Coca-Cola Company. This contract relates to the exclusive rights to manufacture, distribute,and sell the Coca-Cola brand products in certain areas.
The contract is for 10 years and will be renewed without consideration of renewals or extensions.
The Group accounts for contract related intangible asset attributable to bottling contract as an intangible asset withindefinite useful life. The Group believe that it is unlikely that we will not renew or extend the contract due to ourhistorical relationships with The Coca-Cola Company and the possible adverse impact on our franchisors from the nonrenewal of the contract. Therefore, it is difficult to predict the periods during which asset may generate net cash flows.
Contract related intangible asset is not amortized but is tested for impairment annually and whenever events or changes
in circumstances indicate a potential impairment may occur.
(11) Leases (as a lessee)
When concluding a contract, the Group determines whether the contract is, or contains, a lease. A contract is, or
contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange
for consideration.
The Group recognizes Right-of-use assets and lease liabilities at the commencement date of the lease. Right-of-use
assets are measured at cost on the commencement date. After the commencement date, the Right-of-use assets aremeasured at cost less any accumulated depreciation and any accumulated impairment losses using a cost model. The lease
period of the right-of-use asset is estimated as the non-cancellable lease period, together with both periods covered by anoption to extend the lease if the lessee is reasonably certain to exercise that option; and periods covered by an option toterminate the lease if the lessee is reasonably certain not to exercise that option. Right-of-use assets are depreciated byusing the straight line method, generally over 15 years from the commencement date.
Lease liabilities are measured on the commencement date at the present value of the lease payments that have not been
made as of that date. After the commencement date, the carrying amount of the lease liabilities are adjusted to reflect theinterest rate on the lease liabilities and the lease payments made. If the lease liabilities are revised or the terms of thelease are changed, the lease liabilities will be remeasured, and the right-of-use asset will be revised.
(12) Impairments of property, plant and equipment, intangible asset and Right-of-use asset
The Group performs impairment tests for intangible asset with indefinite useful life annually or when for events orchanges in circumstances that may indicate a potential impairment. Other non-monetary assets are tested for impairment
when there is an indication that the carrying amount of asset or cash-generating unit exceeds recoverable amount.
The recoverable amount of individual asset or cash-generating unit is the higher of fair value less costs of disposal orvalue in use. Value in use is determined as the present value of the future cash flows expected to be generated by the
related asset. If the recoverable amount of an individual asset cannot be estimated, the recoverable amount of the cashgenerating unit to which the asset belongs is estimated. The discount rate reflects the current market valuation of the timevalue of money and the risks inherent in the asset. In determining fair value less costs of disposal, the Group also considers
recent market transactions conditions. If such transactions are not identifiable, an appropriate valuation model is used todetermine the fair value less costs of disposal.
72

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

If the carrying amount of asset or cash-generating unit exceeds recoverable amount, the carrying amount is reduced to
its recoverable amount and the impairment loss is recognized in profit or loss. The impairment loss of cash-generating
unit is allocated based on the carrying amount of each relevant asset. Impairment loss is recognized as "Other expense."
At each reporting date, the Group assess whether there is any indication that the impairment loss recognized in prioryears will decrease or cease to exist. If there is an indication of reversal of impairment and the estimate used in calculating
recoverable amount changes, an impairment loss is reversed. Impairment loss is reversed up to the amount not exceeding
the carrying amount after deducting the required depreciation or amortization from the carrying amount in the event the
impairment loss is not recognized. Reversal of impairment loss is recognized as "Other income."(13) Financial instruments(a) Financial asset and financial liability - recognition and derecognition
The Group initially recognizes trade and other receivables on the date they are incurred. Other financial asset andfinancial liability are initially recognized on the transaction date in which they become contract parties.
The financial asset is derecognized if the contract rights to the cash flows arising from the financial asset expire, if
the financial asset is transferred and substantially all the risks and rewards of ownership of the financial asset aretransferred, or if control over the asset of transfer loses. Financial asset created or retained by the Group are
derecognized and recognized as a separate asset or liability.
Financial liability is derecognized from contract obligations upon discharge, cancellation or expiration. Financial
asset and financial liability are offset and presented on a net basis in the consolidated statements of financial position
only if they have a legally enforceable right to offset the recognized amounts and intend to settle on a net basis or tosimultaneously cash the asset and settle the liability.
(b) Classification and measurement of financial asset
At initial recognition, financial assets are classified as subsequently measured at amortized cost or fair value.
Financial asset measured at fair value through profit or loss is initially measured at fair value. Financial asset
measured at fair value through other comprehensive income and financial asset measured at amortized cost are initiallymeasured at fair value plus transaction costs directly attributable to the acquisition.
The Group's classification under IFRS 9 is based on facts and circumstances, and the Group designates equity
instrument as an equity instrument measured at fair value through other comprehensive income.
(i) Financial assets measured at amortized cost
Financial asset is classified as measured at amortized cost if both of the following conditions are met:
- if the objective of our business model is to hold financial asset in order to collect contractual cash flows; and- if, by contract terms, the condition that a cash flows that is solely payment of principal and interest on the principal
amount outstanding gives rise on a specified date.
(ii) Financial assets measured at fair value
If any of the above two conditions are not met, the financial asset is classified as measured at fair value. For
financial assets measured at fair value, the Group decided whether to make an irrevocable designation for eachfinancial instrument, except for the equity instrument held for trading purposes that must be measured at fair value
through the profit or loss, or at fair value through other comprehensive income.
For derivative, see "(e) Derivative and hedge accounting."
Financial asset is classified into the following categories for subsequent measurement.
(i) Financial asset measured at amortized cost
They are measured amortized cost based on effective interest method and if any, impairment loss is deducted.
Gains or losses arising from effective interest method or derecognition are recognized in profit or loss.
(ii) Financial asset measured at fair value
They are measured at fair value as of the reporting date. Changes in fair value are recognized in profit or loss orother comprehensive income, depending on the classification of the financial asset. Dividends income arising fromthe equity instrument designated as measured at fair value through other comprehensive income is recognized in
profit or loss. In addition, in the event the derecognition of equity instrument designated as measured at fair value
through other comprehensive income, the cumulative changes in fair value recorded in accumulated othercomprehensive income are reclassified to retained earnings.
73

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(c) Classification and measurement of financial liability
At initial recognition, financial liability is classified as financial liability that is subsequently measured at fair value
through profit or loss or at amortized cost. Financial liability measured at fair value through profit or loss is initiallymeasured at fair value, but financial liability measured at amortized cost is initially measured at the fair value less costs
directly attributable to the acquisition.
Financial liability is classified into the following categories for subsequent measurement.
(i) Financial liability measured at fair value through profit or loss
They are measured at fair value as of the reporting date. Changes in fair value are recognized in profit or loss.
Derivative liability is classified as the financial liability measured at fair value through profit or loss. At initialrecognition, no irrevocable designation is made as a financial liability measured at fair value through profit or loss.
For derivative, see "(e) Derivative and hedge accounting."(ii) Financial liabilities measured at amortized cost
They are measurement at amortized cost based on effective interest method. Gains or losses arising from effective
interest method or derecognition are recognized in profit or loss.
(d) Impairment
The Group makes expected credit loss estimates on the reporting date basis on the recoverability of financial asset
measured at amortized cost. For financial instruments whose credit risk has not increased significantly since initialrecognition, an expected credit loss of 12 months is recognized as allowance for credit loss. For financial instrument
whose credit risk has increased since initial recognition, lifetime expected credit loss is recognized as allowance for
credit loss. However, allowance for credit loss for trade receivables is always measured at an amount equal to thelifetime expected credit losses.
For financial assets whose credit risk has increased significantly, if there is evidence of credit impairment, interest
income is measured multiplied by effective interest rate by the net amount of carrying amount less allowance for credit
loss.
The indicators used by the Group in determining if objective evidence of impairment exists include the following:・ significant financial difficulty of the issuer or the borrower;
・ a breach of contract, such as a default or past due event;・ the lender(s) of the borrower, for economic or contractual reasons relating to the borrower’s financial difficulty,
having granted to the borrower a concession(s) that the lender(s) would not otherwise consider;・it is becoming probable that the borrower will enter bankruptcy or other financial reorganization; or・the disappearance of an active market for that financial asset because of financial difficulties.
If the Group does not have a reasonable expectation of collecting the entire or a portion of the financial asset, theamount is deducted directly from the carrying amount of the financial asset (write-off). If the credit risk is subsequently
reduced and clearly distinguishable from events that occurred after direct write-offs (e.g., improved credit ratings ofthe obligor), the reversal of write-offs is recognized in profit or loss.
(e) Derivative and hedge accounting
Derivative is initially recognized at the fair value of the date the derivative contract is concluded, and after initialrecognition, it is remeasured at fair value on the reporting date. Recognition of gains or losses resulting fromremeasurement depends on whether the derivative is designated as hedging instrument and, if specified as hedging
instrument, the nature of the hedged item. The Group designates certain derivative as hedging instrument for cash flow
hedges (certain risks related to asset or liability, or highly probable forecast transaction hedges).
At the inception of the hedging relationships, the Group documents the relationships between hedging instrument
and hedged item, as well as our risk management objectives and strategies for executing these hedging transactions.
The Group also documents the assessment, at the hedge's inception and on an ongoing basis, of whether the derivative
used in the hedge transaction is effective to offset changes in the cash flows of the hedged item.
The Group evaluates the hedge effectiveness on an ongoing basis and judges that it is effective when all of thefollowing conditions are met:
・ there is the economic relationship between hedged item and hedging instrument;・ the impact of credit risk is not materially superior to changes in value arising from economic relationships; and・ the hedge ratio of hedging relationships is the same as the ratio resulting from the volume of hedged item andhedging instrument actually being hedged.
The effective portions of changes in the fair value of derivative which is designated and qualifying as a hedging
74

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

instrument for cash flow hedge are recognized in other comprehensive income. Gains or losses on the ineffective
portion are recognized in profit or loss immediately.
Accumulated gains or losses recognized in other comprehensive income are reclassified to profit or loss in the period
in which the cash flows arising from the hedged item affects profit or loss. However, if the forecast transaction which
is a hedged item results in the recognition of a non-financial asset (e.g., inventories or property, plant and equipment),
the gain or loss previously recognized in other comprehensive income is reclassified into the measurement of the initialcost of the related asset. Such amounts are ultimately recognised as cost of sales in the case of inventories and as
depreciation in the case of property, plant and equipment.
Hedge accounting is discontinued prospectively if the hedge relationship no longer meets the qualifying criteria dueto the extinction or sale of hedging instrument. If the hedged cash flows are expected to be incurred in the future, theaccumulated gains or losses recognized in other comprehensive income will continue to be recognized as anaccumulated other comprehensive income. If a forecast transaction is no longer expected to occur, the cumulative gains
or losses recognized in other comprehensive income is reclassified to profit or loss.
(14) Provision and contingent liabilities
Provision is recognized when the Group has a present legal or constructive obligation as a result of historical events,
it is probable that an outflow of economic resources will occur to settle such obligation and a reliable estimate of theamount of such obligation can be made. Contingent liabilities are not recognized in consolidated financial statements,
but the Group notes them unless the possibility of an outflow of resources due to payments.
Provision is measured at the present value of the best estimate of the amount that would be required to pay or transfer
the obligation, taking into account probability that event occurs and its impact. The reversal of the discount by passageof time is recognized as financial expense.
(15) Employee benefits(a) Short-term employee benefits
Short-term employee benefit is recognized as expense when the related services are rendered. When the Group haspresent legal and constructive obligation to be paid as consideration for past service of employees and the amount canbe estimated reliably, the estimated amount of payment is recognized as a liability.
(b) Defined contribution plans
Contributions to the defined contribution plans are recognized as expenses in the period in which the employee
renders the services.
(c) Defined benefit plans
The Group’s net obligation related to defined benefit plans is calculated for each plan by estimating the amount of
future benefits earned by employees prior to the current period, discounting the amount to the present value, anddeducting the fair value of plan asset.
Defined benefit plans obligations are calculated annually by actuaries using the projected unit credit method.
Remeasurement of defined benefit obligations, consisting of the actuarial gains and losses, return on plan asset(excluding interest) and impact of asset ceiling, is recognized in other comprehensive income and immediately
reclassified from accumulated other comprehensive income to retained earnings. The Group calculates net interest
expense (income) for the fiscal year by multiplying the discount rate used to measurement the defined benefit plansobligation (asset) at the beginning of the fiscal year by the defined benefit plans obligation (asset) and the plan asset atthe beginning of the period.
Defined benefit plans obligations at the beginning of the fiscal year take into account all changes in defined benefit
plans obligations (asset) during the fiscal year due to contributions and benefit payments. Net interest expense andother expenses related to defined benefit plans are recognized in profit or loss.
In the event of a change or curtailment in defined benefit plans benefits, the portion of the change in benefits related
to prior service or the gain or loss on curtailment is recognized immediately in profit or loss. When a defined benefit
plans is liquidated, the gain or loss on the settlement is recognized in profit or loss.
(d) Other long-term employee benefits
Long-term employee benefits other than post-employment benefits are recognized as a liability when the Group has
a present legal and constructive obligation to be paid as consideration for employees’ service rendered in the prior year
and the current year, and the amount can be estimated reliably. The Group’s long-term employee benefits is calculated75This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

by discounting the estimated future benefit to its present value.
The discount rate is determined based on the market yield on AA-rated corporate bonds at the reporting date, whichapproximates the average remaining service period.
(16) Income taxes
Tax expenses consist of current tax and deferred tax. These are recognized in profit or loss except for items related tobusiness combination and items recognized directly in equity or other comprehensive income.
If income taxes relate to items that are directly recognized in equity or other comprehensive income, such taxes arealso recognized directly in equity or other comprehensive income.
(a) Current tax
Current tax is the estimated amount of income tax payable or refund receivable in respect to the current taxable
income or loss, adjusted for income taxes payable and refund receivable through the previous year. The amount of
current tax is due to our best estimate of the amount of taxes reflecting uncertainties related to income taxes. Current
tax also includes taxes arising from dividends.
(b) Deferred tax
Deferred tax is recognized for the temporary differences between the carrying amount of asset and liability inconsolidated financial statements and its tax basis. Deferred tax asset and liability are recognized for the temporary
differences between the carrying amount of asset and liability and their tax bases at the reporting date, the carryforward
of unused tax losses and the carryforward of unused tax credits. The amounts are calculated based on the tax rates
expected to apply to the period in which the asset is realized or the liability is settled.
Deferred tax is not recognized in the following cases:
・ temporary differences related to the initial recognition of asset or liability in a transaction other than businesscombination that does not affect either accounting or tax basis;・ temporary differences related to investments in subsidiary, the associate and the joint arrangement, which theGroup will be able to control the timing of the reversal of the temporary difference and which it is probable thatthe temporary differences will not reverse in the foreseeable future; or・ taxable temporary differences arising from initial recognition of goodwill.
Deferred taxes are recognized in the following cases:
・ temporary differences arising from investments in consolidated subsidiary and associate is recognized to theextent that it is probable that it will be reversed and taxable income will be available.
・ for transactions that recognize both asset and liability at the same amount from a single transaction, deferred tax
liability for temporary differences on the recognized asset and deferred tax asset for temporary differences on
the recognized liability are recorded.
Deferred tax asset is recognized unused tax losses, unused tax credits and deductible temporary difference to theextent future taxable income is available. Future taxable income is calculated based on business plans for individual
subsidiary in the Group. Deferred tax asset is reviewed at each reporting date and reduced for the portion that is nolonger probable that the tax benefit will be realized. Such reductions are reversed when the likelihood of earning
sufficient taxable income improves.
Unrecognized deferred tax asset is reviewed at each reporting date and recognized to the extent that they are probableto be available for future taxable income. Deferred taxes are measured using the tax rates expected to apply when thetemporary differences are reversed under laws enacted or substantively enacted at the reporting date.
Deferred tax asset and liability are offset if there is a legally enforceable right to offset current tax asset against
current tax liability and deferred tax assets and liability are related to income taxes levied by the same taxing businessby the same taxing authority.

76This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(17) Equity(a) Ordinary share
Ordinary share is classified as equity. The incremental costs directly attributable to the issuance of ordinary shareare deducted from equity, net of tax.
(b) Purchase and disposal of ordinary share (treasury stock)
When the Group acquires treasury stock, the consideration paid including direct transaction costs (net of tax) is
recognized as a deduction of shareholders' equity under the presentation of "Treasury stock". When the Group sells
treasury stock, the difference between the sales price and the carrying amount is recognized as “Capital surplus”.
(18) Dividends
Dividends to the Company’s owners is recognized as a liability of the period in which is approved by the Company’sowners.
(19) Revenue recognition
Revenue is recognized for the contract with customer under IFRS 15 excluding interest and dividends income by
applying the following five steps:
Step 1: Identifying contract with customer
Step 2: Identifying performance obligation in contract
Step 3: Determining the transaction price
Step 4: Allocating the transaction price to performance obligation in contract
Step 5: Recognizing revenue when (or as) performance obligation is met
The Group sells soft drinks such as carbonated beverages, coffee beverages, tea-based beverages and mineral water,and healthcare products. For sales of these products, revenue is recognized primarily at the time of delivery as customer
has obtained control over the products and believes that the performance obligation is satisfied. In addition, revenue ismeasured at consideration promised in the contract with customer, less discounts, rebates, returns and other items.
(20) Government grants
Government grants are measured at fair value when there is reasonable assurance that the conditions attached to them
are met and the grants will be received. Government grants relating to revenue are recognized in profit or loss over theperiod in which the related costs intended to be compensated by the grant are recognized as an expense, and are recorded
as other income. Government grants related to an asset are reduced directly when calculating the carrying amount for theasset.
Grants are recognized in profit or loss as a reduction of depreciation expense over the useful life of the applicabledepreciation asset.
(21) Stock-based compensation
The Company has introduced a performance-linked stock-based incentive compensation system for the Company’s
directors (excluding members of the Audit and Supervisory Committee and outside directors) as well as for the executive
officers of the Company and its subsidiaries, with the aim of sharing the merits and risks of stock price fluctuations withthe shareholders and further enhancing the motivation of Executive Directors to contribute to increases in the Company’s
stock price and corporate value in the mid to long term. The compensation calculated under the plan is recognized as an
expense and the corresponding increase in equity.

77This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

4. Critical accounting judgments, estimates and assumptions
In preparing the consolidated financial statements in accordance with IFRS, management is required to make judgments,
estimates and assumptions that affect the application of the Group’s accounting policies and the reported amounts of assets,
liabilities, revenue and expenses. Actual results may differ from these estimates. The estimates and the assumptions
underlying the estimates are continually reviewed and are based on historical experience and other factors, including future
events, which are believed to be reasonable under the environments. The future of the domestic soft drink market andbusiness environment is expected to remain uncertain due to the rapid spread of Omicron strains and other factor, thesituation is expected to remain uncertain, and accounting estimates have been made based on the assumption that the impact
will continue for a certain period of time from the fiscal year ending December 31, 2022. Accounting estimates are basedon the most appropriate information at the time the consolidated financial statements are filed, but if any estimates in further
into the future changes, the impact of the revises is recognized in the consolidated statements of profit or loss andconsolidated statements of comprehensive income subsequent to the reporting period in which they are revised.
Information regarding assumptions and estimates that have a significant impact on the amounts recognized in the
consolidated financial statements is as follows:(a) Useful lives of property, plant and equipment and intangible assets
Property, plant and equipment is depreciated over the estimated useful lives, which is the period over which the future
economic benefits of the asset are expected. If property, and equipment is obsolescent in the future or reused for otherpurposes, depreciation expense may increase, and the estimated useful life may be shorter. Details of useful life areprovided in notes 3(8)"Property, plant and equipment."
The right-of-use asset is estimated for the lease term with a non-cancellable period plus a reasonably certain period oftime to exercise the option to extend or not to cancel the lease. Details of the useful life are described in note 3(11) “Leases(as a lessee)”.
Intangible assets are evaluated whether the useful life is definite or indefinite, based on the analyzing of all relevant
factors and predictability of the period over which such intangible asset is expected to result in cash inflows. Intangible
assets with definite useful life are amortized using the estimated useful life, which is the period over which the future
economic benefits are expected. Amortization expense is subject to risks that may increase as a result of changes in theestimated useful life caused by external factors, such as changes in business conditions. Details of useful life are provided
in notes 3(10) "Intangible assets."(b) Impairment test of non-financial assets, including property, plant and equipment,goodwill and intangible asset
In performing impairment tests, the recoverable amount of a cash-generating unit is calculated based on its value in
use. The recoverable amount of a cash-generating unit is calculated based on its value in use. Value in use is mainly
estimated by discounting the estimated cash flows to its present value. Mid-term plans, which are the basis for future cash
flows, are based on sales and cost plans for the relevant period. While such assumptions are based on management's best
estimates and judgments, these assumptions may also be affected by changes in economic conditions that have asignificant impact on future consolidated financial statements. Details of cash-generating unit's and recoverable amount's
decisions are provided in notes 3 (9) “Goodwill” 3 (12) “Impairments of property, plant and equipment, intangible asset,
goodwill and lease asset” and notes 12 "Impairment of non-financial assets."(c) Provision
In the consolidated statements of financial position, the Group recognizes mainly provision on asset retirement
obligations and environmental measures provision. Provision is measured based on the best estimate of the expenditures
required to settle the obligation. Expenditures required to settle obligations are calculated by considering all factors
affecting future results but may be affected by unforeseeable events and changes in the environment assumed.
The accounting policies and reported amounts of provision are described in notes 3(14)"Provision and contingent
liabilities" and notes 15 "Provisions," respectively.
(d) Recoverability of deferred tax assets
At recognition of deferred tax assets, the Group estimates the timing and amount of future taxable income based on
the Group’s mid-term plans. Estimates of future taxable income are based on mid-term plans. The main assumptions are
the sales plan and cost plan for the period. In assessing the recoverability of deferred tax assets, the Company considers
the expected reversal of deferred tax liabilities, projected future taxable income and tax planning. While such assumptions
are based on management's best estimates and judgments, these assumptions may also be affected by changes in economic
conditions that have a significant impact on future consolidated financial statements Further information regarding the78This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

recoverability of deferred tax assets is provided in notes 3(16), "Income taxes" and notes 28, "Income taxes."(e) Measurement of defined benefit plans obligation
The Groups adopts a variety of retirement benefit plans, including defined benefit plans. The present value and service
cost of defined benefit obligations for all plans are based on actuarial projections. Actuarial projections require estimatesand judgments related to variable factors such as discount rates, rates of salary increase and inflation. The Group isadvised by external actuaries as to the adequacy of actuarial projections, including these variable factors. While actuarial
projections are determined based on management's best estimates and judgments, they may be affected by changes in
uncertain future economic conditions and the establishment and revise of related laws and regulations that could have amaterial effect on future consolidated financial statements.
Further information on the actuarial projections for the measurement of defined benefit obligations is provided in notes
18 “Post-employment benefits”.
(f) Measurement of financial instrument without quoted prices in active market
The Group applies valuation techniques that use unobservable inputs in the market to evaluate the fair value of financial
instrument without quoted prices in active market. Unobservable inputs may be impacted by uncertain future changes in
economic conditions that could have a material impact on future consolidated financial statements.
Details related to the assessment of financial asset are provided in notes 31, "Financial instruments (7) Fair value offinancial instruments."
5. Business segments Information(1) Reportable segments
Operating segments are defined as the components of the Group for which separate financial information is available
that is evaluated regularly by the chief operating decision maker in making resource allocation decisions and in assessing
performance.
From the current fiscal year, the Group has changed to a single segment of "Beverages". This is because the healthcare
and skincare business is classified as a discontinued operation following the conclusion of an agreement to transfer all
shares in Q'sai to Q-Partners Inc. on December 15, 2020. The transfer of all shares in Q’sai was completed on February
1, 2021. Refer to “9. Disposal groups classified as held for sale and discontinued operations” for the reclassified amountsof the Revenue and Profit before income tax of the discontinued operations.
No operating segments have been aggregated to form reportable segments.
Reportable segment

Principal Products and Services
Purchase, manufacture, sale, bottling, packaging, distribution and marketing of

Beverage businesscarbonated beverages such as Coca-Cola, coffee and black-tea beverages, mineralwater, alcohol, etc., vending machine-related business in JapanThe Board of Directors evaluates the performance of its segments in comparison to its peers based on operating
profit reported in accordance with generally accepted accounting standards (IFRS). The accounting methods used for
operating segment reported are the same as those described in notes 3 "Significant accounting policies."(2) Information for each product and service
This information is omitted because the same information is disclosed in "(1) Reportable Segments."(3) Information for each region
Sales revenue by geographic region is omitted because the revenue of domestic sales to external customer accounts forthe majority of sales revenue in the consolidated statements of income.
Since the carrying amount of non-current assets in Japan accounts for the majority of non-current assets in the
consolidated statement of financial position, the description of non-current assets by region is omitted.
(4) Major customer
There is no customer to which sales exceeds 10% of the Group’s total revenue.

79This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

6. Cash and cash equivalents
The breakdown of cash and cash equivalents is as follows:
Previous fiscal year
(As of December 31, 2020)(Millions of yen)
Current fiscal year
(As of December 31, 2021)

114,778

110,497

114,778

110,497

Cash and cash equivalents included in assets held for sale－0

Cash and cash equivalents in the consolidated statement ofcash flows

126,378

110,497

Previous fiscal year
(As of December 31, 2020)(Millions of yen)
Current fiscal year
(As of December 31, 2021)

Cash and demand deposits
Cash and cash equivalents in the consolidated statement offinancial position

7. Trade and other receivables
Trade and other receivables consisted of the following:

Accounts and notes receivable

72,63872,527

Accounts receivable - other
Allowance for credit losses

23,763(392)

33,194(401)

96,009105,320Total

8. Inventories
The breakdown of inventories is as follows:(Millions of yen)Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

Raw material
Merchandise and finished products

3,225
59,424

3,477
58,961

Supplies

5,531

5,145

68,18067,583Total

The amount of inventory recorded in "Cost of sales" for the previous fiscal year and the current fiscal year was 428,944
million yen and 435,319 million yen, respectively. Of this amount, the amount of write-down of inventory assets in theprevious fiscal year and the current fiscal year was 1,223 million yen and 1,946 million yen, respectively. As a result of the
spread of the COVID-19 infection during the year, Product valuation losses of products that were to be disposed of havebeen transferred from cost of sales to other expenses. The amounts transferred are shown in “26. Other income and otherexpense”

80This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

9. Disposal groups classified as held for sale and discontinued operations
On December 15, 2020, the Company’s Board of Directors resolved to sell all of the shares of the Company’s consolidated
subsidiary, Q’sai to Q-Partners Co., Ltd., a company formed for this purchase led by investment funds in which Advantage
Partners Inc. provides services, euglena Co., Ltd., and Tokyo Century Corporation, the transfer of all shares in Q’sai wascompleted on February 1 2021.
As a result of executing the share transfer agreement, Q’sai’s assets and liabilities are classified as a disposal groups
classified as held for sale, and the Healthcare and Skin Care business was classified as a discontinued operation beginningin the year ending December 31, 2020.
(1) Disposal groups classified as held for sale
The breakdown of disposal groups classified as held for sale is as follows:
As for the disposal group classified as held for sale, the transfer of all shares was completed during the current fiscal
year.
(Millions of yen)

As ofDecember 31, 2020
AssetsCurrent assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other financial assets
Other current assets
Total current assets

11,599
1,308
2,031
3
61
15,001

Non-current assets
Property, plant and equipment
Right-of-use assets
Goodwill
Intangible assets
Other financial assets
Deferred tax assets
Other non-current assets
Total non-current assets

2,931
1,197
27,021
778
322
880
6
33,137
48,138

Total assets
Liabilities
Current liabilities
Trade and other payables
Lease liabilities
Income taxes payable
Other current liabilities
Total current liabilities

2,940
155
610
1,886
5,591

Non-current liabilities
Lease liabilities
Net defined benefit liabilities
Other non-current liabilities

1,088
366
148
1,602

Total non-current liabilities
Total liabilities

7,193

81

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(2) Profit/loss from discontinued operations
The gain on the sale of all shares of Q’sai for the current fiscal year was 12,841 million yen, and the income tax expense
related to the sale was 337 million yen. Due to immateriality, no gain or loss other than from sale transactions related to
discontinued operations up to the date of loss of control was recognized in the current fiscal year.
The results of discontinued operations are as follows:(Millions of yen)
For the year ended
December 31, 2020
Discontinued operations
Revenue
Cost of sales

For the year ended
December 31, 2021

24,7735,030ʷ
ʷ

Gross profit

19,743ʷ

Selling and general administrative expenses
Other income
Other expenses

16,19132
29

ʷ
12,841ʷ

Operating income

3,555

12,841

Financial revenue
Finance costs

1
11

ʷ
ʷ

3,545
1,126

12,841337

2,418

12,505

Income for the year before income taxes
Income tax expense
Net income for the year from discontinued
operations(3) Cash flows from discontinued operations
The results of discontinued operations are as follows:(Millions of yen)
For the year ended
December 31, 2020
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities

For the year ended
December 31, 2021
4,452
(523)
(161)

ʷ
34,490ʷ(Note) Cash flows from investing activities in the current fiscal year was due to the proceeds from the sale of all sharesof Q’sai.

82

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

10. Property, Plant and Equipment and Right-of-use assets
Changes in the cost, accumulated depreciation and accumulated impairment losses and the carrying amount of property,
plant and equipment are as follows:
Acquisition cost
(Millions of yen)
Property, Plant and Equipment
Total

Right-ofuse assets

22,190777,330

55,65510

9,640

56,9505,960(12,080)(4,538)－(32,627)(12,906)

8,121

－

0

(13,338)－－(3,094)(2,624)－(1,013)－(6,731)(1,512)

－

－

－

－

(232)

(232)

(963)

168,390

223,862

237,187

146,991

18,260794,691

46,234

Acquisition

2,996

10,279

9,573

636

4,133

27,6189,195

Disposal and saleTransfer fromconstruction inprogress(3,042)(3,800)(9,578)(3,326)－(19,746)(13,887)

8,645

3,599

－

68

(12,311)

－

－

－

－

－

－

(646)

(646)

－

176,989

233,940

237,182

144,370

9,436

801,916

41,543

Buildings
andstructures

MachineryandvehiclesVending
machineLand

Constructionin progress

169,037

196,828

236,743

152,532

Acquisition

7,132

27,644

12,525

Disposal and sale

(9,901)(6,107)

5,217

Balance at January 1, 2020

Transfer fromconstruction inprogress
Transfer to disposalgroup held for sale
Other
Balance at December 31,
2020

Other
Balance at December 31,
2021

83

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Accumulated depreciation and impairment losses
Property, Plant and Equipment
Buildings
andstructures

MachineryandvehiclesVending
machineLand(82,387)(107,453)(117,736)(2,618)(7,607)

Balance at January 1, 2020
Depreciation.

Total

Right-ofuse assets－(310,194)(16,026)

Constructionin progress(15,637)(26,076)－－(49,320)(7,154)

Impairment losses
Disposal and sale

(240)

(247)

－

(64)

－

(551)

(524)

6,373

5,617

9,724

363

－

22,076

5,998

Transfer to disposalgroup held for sale

1,863

1,937

－

－

－

3,800

315

－

－

－

－

－

－

966

(81,998)(115,783)(134,089)(2,319)－(334,189)(16,425)

Other
Balance at December 31,
2020
Depreciation.

(7,364)(16,067)(24,023)－－(47,453)(6,580)

Impairment losses

(463)

(281)

－

－

－

(744)

－

Disposal and sale

2,784

3,544

8,622

412

－

15,362

6,691

19

82

－

－

－

102

(85)

(87,021)(128,504)(149,490)(1,907)－(366,922)(16,398)

Other
Balance at December 31,
2021

Carrying amount(Millions of yen)
Property, Plant and Equipment
Buildings
andstructures

MachineryandvehiclesVending
machineLand

December 31, 2020

86,392

108,079

103,098

144,672

December 31, 2021

89,968105,436

87,692

142,463

Total

Right-ofuse assets

18,260460,50229,8109,436

434,994

25,144

Constructionin progress

Depreciation of property and equipment is included in "Cost of sales" and "Selling, general and administrative
expenses" in the consolidated statements of profit or loss.

84

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

11. Goodwill and intangible asset
Changes in the cost, accumulated amortization and accumulated impairment losses and carrying amounts of goodwill
and intangible asset were as follows:
Acquisition cost
(Millions of yen)

Goodwill

Balance at January 1, 2020
Acquisition
Disposal and saleTransfer to disposal group held for
sale
Other
Balance at December 31, 2020
Acquisition
Disposal and sale
Other
Balance at December 31, 2021

Intangible
assets withindefinite
useful lives
Contract
relatedintangible
asset

Intangible assets with finite useful
lives
Intangible
asset totals
SoftwareOther

103,359－

52,050－21,542
3,247

753
7

74,345
3,254－－(1,629)(3)(1,632)(41,500)－(1,372)(4)(1,376)

－

－

1

(320)

(320)

61,859－52,050－21,790
3,371

432
－

74,272
3,371

－
－

－
－

(111)
(145)

(64)
－

(175)
(145)

61,85952,05024,905368

77,32385

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Accumulated amortization and impairment losses(Millions of yen)

Goodwill

Intangible
assets withindefinite
useful lives
Contract
relatedintangible
asset

Intangible assets with finite useful
lives
Intangible
asset totals
SoftwareOther(76,338)－－－(6,805)(417)(7,222)－－(3,037)18(72)－(3,109)18－
14,479

－
－

1,326
595

3
2

1,329
597

－

－

(13)

320

308

－

(7,916)(163)(8,079)Depreciation
Impairment losses(61,859)－－－－(3,058)－(68)－(3,126)－

Disposal and sale
Other

－
－

－
－

58
－

43
－

102
－

(61,859)－(10,916)(188)(11,104)

Balance at January 1, 2020
Depreciation
Impairment losses
Disposal and saleTransfer to disposal group held for
sale
Other
Balance at December 31, 2020

Balance at December 31, 2021
Carrying amount(Millions of yen)

Goodwill

Intangible
assets withindefinite
useful lives
Contract
relatedintangible
asset

Intangible assets with finite useful
lives
Intangible
asset totals
Software

Other

December 31, 2020－

52,05013,874269

66,193

December 31, 2021－

52,05013,989180

66,219Software at the end of the previous fiscal year and the end of the current fiscal year includes internally generated
intangible assets of 602 million yen and 516 million yen, respectively.
Amortization of intangible assets is included in "Cost of sales" and "Selling, general and administrative expenses" in the
consolidated statements of profit or loss.
Individually significant goodwill was mainly due to the business integration with Coca-Cola East Japan Co., Ltd. and theresulting consolidation of associates as consolidated subsidiaries in the previous fiscal year but an impairment loss wasrecognized in prior years.
Details of the contract related intangible assets are included in Note 3 (9) "Intangible assets".

86This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

12. Impairment of non-financial assets(1) Impairment losses
The impairment losses recognized by the Group were as follows:
The impairment losses are recorded in "Other expense" in the consolidated statements of profit or loss.
(Millions of yen)
For the year ended
December 31, 2020

For the year ended
December 31, 2021

Property, plant and equipment
Buildings and structures

240

463

Machinery and vehicles
Land

247
64

281
－

Subtotal

551

744

524

－

1,075

744

Right-of-use assets
Total

We group business assets in a unit of each business as defined under the management accounting system tocontinuously keep track of incomes and expenditures of such business assets. As to the lease assets and idle assets, we
determine their potential impairment by grouping individual asset as a minimum unit.
In the previous consolidated fiscal year and current consolidated fiscal year, we reduced the book value of buildings,
structures, and land of idle assets, whose prices are decreasing, to the recoverable amounts and recorded such decreaseas the impairment losses.
The recoverable amount of idle assets, including buildings and structures and land, is measured at fair value less costsof disposal. The recoverable amounts of the idle assets are calculated based on the real estate appraisals, etc. The fairvalue hierarchy is classified as Level 3. Among such idle assets, the recoverable amount of machinery, equipment andvehicles and Right-of-use assets is measured by value in use, and the value is set at zero.

87This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(2) Impairment testing of a cash-generating unit or cash-generating unit group, including goodwill and intangible assets
with indefinite useful lives
Goodwill acquired as part of the business combination and intangible asset (contract related intangible asset) withindefinite useful lives are allocated to cash-generating unit or cash-generating unit group for which synergies are
expected. Amounts of intangible asset with indefinite useful lives allocated to cash-generating unit or cash-generating
unit group are as follows:(Millions of yen)

Intangible assets withindefinite useful lives

Reportable segments

Cash-generating
unit or cashgenerating unit
group

Beverage business

Beverage(Contract related
intangible asset)

Total

Previous fiscal year
(As of December
31, 2020)

Current fiscal year
(As of December
31, 2021)

52,05052,05052,05052,050The cash-generating units or groups of cash-generating units to which goodwill or intangible assets are allocated shallbe tested for impairment annually, and in addition, if there are events or changes in circumstances that indicate a potential
impairment which no impairment losses were recognized in the previous or current fiscal years. The recoverable amountof cash-generating unit or cash-generating unit group to which goodwill and intangible assets with indefinite useful life
has been allocated in calculated based on its value in use. Value in use is calculated by discounting future cash flows topresent value. Value in use is calculated by applying the appropriate discount rate to those future cash flows to the present
value. Future cash flows are calculated using the medium-term plan, budget and, for periods after those indicated in theplan, the going value, which takes into the long-term average growth rate of the market. When assets are grouped forrecoverability assessments used to estimate recoverable amounts include future cash flows, discount rates, and long-term
average growth rates. However, the medium-term plan, which is the basis for future cash flows is based on sales and costplans for the relevant period which with regard to the estimation of future cash flows, the Company assumes that the
impact of the spread of the coronavirus infection will continue for a certain period of time after the fiscal year ending
December 31, 2022. The amount which based on these assumptions reflect management's assessment of future trends inthe relevant industries and are based on historical data from both external and internal information. The discount rate
before-tax and growth rates used to calculate the value in use of the cash-generating unit or group of cash-generating
units to which the goodwill and intangible assets were allocated at the end of the previous fiscal year and at the end of
the current fiscal year are as follows:
Cash-generating unit or cashgenerating unit group

Previous fiscal year
(As of December 31, 2020)
Discount rate

Growth rate

Current fiscal year
(As of December 31, 2021)
Discount rate

Growth rate

Beverage
5.0%
0.6%
5.5%
0.5%
(NOTE) 1. The discount rate was the pre-tax discount rate, which is adjusted for the risk premium reflecting the increased risk ofinvesting in equity and the market-related risk of the specific cash-generating unit, based on the rate of 10-year
government bonds issued by the Japanese government in the same currency-denominated market as the cash flows(Japanese yen).
2. The Group estimates the cash flows by using growth rates expected from the market and our businesses. The growth rate
was determined based on the long-term average growth rates of the markets consistent with the assumptions assumed
to be used by the market participants.

88This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(3) Sensitivity analysis
The following table shows the values where each of the key assumptions has been independently replaced to match therecoverable amount to the book value.
For Beverage, the recoverable amount exceeded the book value of 198,443 million yet in the current fiscal year. However,if the discount rate is greater than 7.1% or the growth rate is less than -1.4%, an impairment loss may occur.

Cash-generating unit or cashgenerating unit groups

Previous fiscal year
(As of December 31, 2020)
Discount rate

Beverage

Current fiscal year
(As of December 31, 2021)

Growth rate

7.4%

Discount rate(2.3)%

Growth rate

7.1%(1.4)%

13. Other current assets and other non-current assets
Other current assets and other non-current assets consisted of the following:(Millions of yen)Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

Prepaid expense
Income tax receivable

7,552
2,450

8,005
3,827

Consumption tax receivable
Other

7,154
39

4,156
287

Total

17,195

16,275Long-term prepaid expenses
Other

7,124
58

5,953
53

Total

7,183

6,006

Current

Non-current

89This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

14. Trade and other payables
Trade and other payables consisted of the following:(Millions of yen)Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

Trade payables

32,07634,814

Accounts payable - otherAccrued expenses

67,7552,648

65,337
3,110

102,480

103,260

Total
15. Provisions
Changes in provision were as follows:(Millions of yen)

Balance at December 31, 2020
Provision
Decrease during the fiscal year (intendeduse)
Increase due to passage of time and change
in discount rate
Balance at December 31, 2021
Current
Non-current
Total

Asset retirement
obligations

Environmental
measuresprovision

2,109
21

19
8

2,128
29

(9)

(2)

(11)

－

－

－

－

－

－

2,121

25

2,146

9
2,112

－
25

9
2,137

2,121

25

2,146

Total

Asset retirement obligations
Asset retirement obligations are recognized based primarily on the estimated future expenditures calculated by using
historical experience in cases where the Group has legal obligations in laws or contracts related to remove the fixed assets
for normal use, such as obligations of removal hazardous materials for construction facilities and offices used by the Groupor restoration of the original condition associated with the leased contract. These expenses are expected to be paid in the
future, but the amount paid may change due to future business plans and other factors.
Environmental measures provision
In order to prepare for expenditures related to the disposal of industrial wastes, the estimated amount of expenditure isrecognized as environmental measures provisions. These expenses are expected to be paid in the future, but the amount paid
may change due to future business plans and other factors.

90

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

16. Bonds and loans payable
Bonds and loans payable consisted of the following:(Millions of yen)Previous fiscal year
(As of December 31,
2020)

Current fiscal year
(As of December
31, 2021)

Averageinterest
rate
(%)

－

29,990

0.52

-

1,072

1,000

0.15

-

50,000－51,07230,990179,514

149,6220.20

2024 to 2029

8,000

7,000

0.15

2023 to 2026

Subtotal

187,514

156,622

Total

238,585

187,612Maturity

Current
Current portion of bonds
Current portion of long-termloans payable
Short-term loans payable
Subtotal
Non-current
Bond
Long-term loans payable

The average interest rate is the weighted average interest rate to the balance as of the current fiscal year, and maturity is
the maturity of the balance as of the current fiscal year. The principal terms of the issuance of the debentures were as
follows:(Millions of yen)
Carrying amount
Name

Name of bondDate of
issue

Issue
amountPrevious fiscal year
(As of December 31,
2020)

Current fiscal year
(As of December
31, 2021)

Interest rate
(%)

Colla
teral

The due datefor
redemption

Jun 17,2015

30,00029,971

29,990(29,990)

0.52

None

Jun 17, 2022

Sep 19,2019

40,00039,89239,921

0.10

None

Sep 19, 2024

Sep 19,2019

60,00059,82859,8580.20

None

Sep 18, 2026

50,00049,82349,843

0.27

None

Sep 19, 2029

179,514

179,612

Coca-Cola
The
Company

west 3rd
Unsecured

The

bonds
1st unsecured

Companybond

TheCompany

2nd unsecured
bond

The
Company

3rd unsecuredbond

Sep 19,
2019

Total

(NOTE) 1. Figures in parentheses represent the redemption schedule within one year.
2. All interest rates are fixed rates.

91This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

17．Leases
The Group mainly rents offices and other facilities in the beverage business, and leases buildings and structures related to it.
The contract term for the lease is mainly 15 years. There are no special restrictions on lease contracts (such as restrictions on
dividends, additional borrowings and additional leases).
The breakdown of profits and losses related to leases is as follows:(Millions of yen)Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

Depreciation of Right-of-use assets
Buildings and structures

7,154

6,580

－

－

7,154

6,580

Land
Total
Interest expense on lease liabilities

390

291

Total cash outflows related to leases(7,296)(7,088)The breakdown of the books of Right-of-use assets is as follows:(Millions of yen)Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

Right-of-use assets
Buildings and structures

29,084

Land
Total

725

674

29,81025,144The increase in Right-of-use assets for the end of the previous fiscal year and the end of the current fiscal year was 5,960
million yen and 9,195 million yen

92

24,470This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

18. Retirement benefits
Regarding retirement benefit plans for employees of the Group, some subsidiaries are to adopt defined contribution
pension plans and defined benefit pension plans, which calculate the amount of contributions and benefits based on theirposition, years of services and other factors. However, as of April 1, 2019, the beverage business was unified into a
defined contribution pension plan and a lump-sum retirement plan, and the conventional defined benefit plan was frozen.
The frozen defined benefit pension liability is calculated based on the retirement benefits determined at the time of thefreeze and is recognized as a defined benefit obligation until the employee is paid a pension or lump-sum payment upon
future retirement.
Past service cost significantly increased in prvious fiscal year due to this change(1) Defined benefit plans(a) Increase (decrease) in present value of a defined benefit obligation
Changes in present value of a defined benefit obligation are as follows:(Millions of yen)Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

131,154
4,005

118,958
3,490

910

1,312

Actuarial gains arising from changes indemographic assumptions

1,304

(184)

Actuarial gains arising from changes infinancial assumptions(5,479)2,526

106(12,675)
(366)

(337)
(7,757)－

118,958

118,007

Balance at the beginning of the year
Service expense
Interest expense
Remeasurement:

Experience adjustment
Benefit payments
Transfers to disposal groups held for sale
Balance at the end of the year

The weighted-average lives of defined benefit plans obligations at the end of the previous fiscal year and the end of
the current fiscal year were 10.9 years and 11.0 years, respectively.
(b) Changes in fair value of plan asset
Changes in the fair value of plan asset were as follows:(Millions of yen)Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

106,246

104,952

723

1,125

8,504
231

6,303
353

Balance at the beginning of the year
Interest revenue
Remeasurement:
Return on plan asset
Contributions by employer
Benefit payments(10,752)(6,550)

Balance at the end of the year

104,952

106,18393This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(c) Change in adjustment due to asset ceiling
Changes in adjustments due to asset ceiling were as follows:(Millions of yen)Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

－

869

869

4,902

－

10

869

5,781

Balance at the beginning of the year
Remeasurement:
Effect of limiting the amount of net plan
assets to the amount of asset ceilingInterest revenue
Balance at the end of the year

Adjustments due to asset ceiling are adjustments that made due to a partial limitation on the amount recorded as asset, although theamounts which the plan asset exceeds present value of a defined benefit obligation under "Employee Benefits" (IAS 19) are recognized
as “Defined benefit asset”.
(d) Adjustments of defined benefit plans Obligations and Plan asset
The relationships between defined benefit plans obligations and plan asset and net defined benefit liability and asset
recorded in the consolidated statements of financial position are as follows:(Millions of yen)Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

Defined benefit plans obligations (funded)

104,082

100,402

Plan assets

104,952

106,183

Net deficit of funded defined benefit plans(869)(5,781)

Adjustments due to asset ceiling

869

5,781

Subtotal
Defined benefit plans obligations (unfunded)－－

14,876

17,605

14,876

17,605

14,876－

17,605－

14,876

17,605Total
Net defined benefit liabilities
Net defined benefit assets
Net defined benefit liabilities recognized in the
consolidated statements of financial position

94This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(e) Major items of plan asset
The plan assets of the Group's retirement benefit plans include marketable equity securities and receivables and are
exposed to stock price and interest rate and foreign exchange risks. The investment of plan asset management aims tomaximize the value of the plan assets over the medium-to-long term in order to ensure that defined benefit plans
beneficiaries receive future benefits within acceptable risks. The plan asset diversifies its investments into a variety ofdomestic and international equities and bonds based on asset allocation targets to reduce risks. With regard to asset
allocation, the Group has set medium-to-long term allocation targets based on forecasts of returns, long-term risks, andpast performance. The asset allocation targets are reviewed as appropriate in the event of a significant change in theoperational environment of the plan asset.
The major categories of plan asset are as follows:(Millions of yen)Previous fiscal year
(As of December 31, 2020)
With quoted
prices inactivemarketWithout
quoted inactivemarketCurrent fiscal year
(As of December 31, 2021)
Total

With quoted
prices inactivemarketWithout
quoted inactivemarket

Total

Equity instrument
Domestic
securities

－

7,408

7,408

－

7,806

7,806

Foreignsecurities－

15,75315,753－

21,616

21,616

－

7,139

7,139

－

6,613

6,613

－

23,115

23,115－22,402

22,402

General account－27,067

27,067－27,51727,517

Alternative
Other

－

14,26010,103

14,260
10,208

－

106

2,153

17,932
145

17,932
2,298

Total

106

104,846

104,952

2,153

104,030

106,183

Debt instrument
Domesticbonds
Foreign bonds

The majority of plan assets are managed through commingled funds. Commingled funds are pool of assets that aregathered to benefit from professional management and economies of scale. Investors have interest in the funds andmeasure the fair value of its interests based on the net asset value of the investments provided by the fund administrators.
The plan assets managed by the funds are invested in marketable securities, such as domestic or foreign stocks anddebts in active markets. Alternatives include investments in funds of funds, etc.
There is no estimated amount of contribution to the plan assets in the next consolidated fiscal year because the plan
assets exceed the minimum required reserve amount.
(f) Significant actuarial assumptions
Significant actuarial assumptions were as follows:
Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

1.10%
2.00%

0.90%
2.00%

Discount rate
Rate of salary increase95

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(g) Sensitivity analysis
The following table presents the monetary impact of changes in significant actuarial assumptions on defined benefit
plans obligations.
(Millions of yen)Previous fiscal year
(As of December 31, 2020)
Increasing
Discount rate
0.25% decrease

Reduction

3,298－

0.25% increase
Rate of salary increase－

0.5% decrease
0.5% increase

Current fiscal year
(As of December 31, 2021)

139

Increasing

－

3,292
－

3,156

Reduction
－
3,150

－

129
－

197
－

184

The sensitivity analysis in the table above assumes that all actuarial assumptions other than the assumptions underwhich the analysis was performed remain constant. This sensitivity analysis represents the changes in the defined
benefit obligation as of the end of the previous fiscal year and the end of the current fiscal year and is the result ofchanges in actuarial assumptions that we believe are reasonable. This analysis is based on provisional calculations andactual results may differ from the analysis.
(2) Defined contribution plans
Expenses for the defined contribution plans of the Group for the previous fiscal year and current fiscal years were
10,373 million yen and 10,352 million yen, respectively.
19. Other current liabilities and other non-current liabilities
Other current liabilities and other non-current liabilities consisted of the following:(Millions of yen)Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

Current
Deposit received

4,373

3,941

Accrued paid leave
Consumption tax payable

5,212
2,754

5,170
1,718

Accrued bonuses
Other

2,894
689

4,520
736

15,92316,085

879
1,693

884
1,645
－

Total
Non-current
Long-term deposits received
Other long-term employee benefits obligations
Liabilities by using equity method
Other

389
415

Total

3,375

96

391
2,920

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

20. Equity(1) Capital stock
Changes in the number of shares authorized and outstanding are as follows:(Thousands of shares)
Previous fiscal year
(From January 1, 2020
to December 31, 2020

Current fiscal year
(From January 1, 2021
to December 31, 2021

Number of shares authorized
Ordinary share with no-par value
Number of issued shares (ordinary share)
Outstanding at the beginning of the fiscal year
Increase during the fiscal year
Decrease during the fiscal year
Outstanding at the end of the fiscal year

500,000

500,000

206,269－

206,269－－－

206,269

206,269(2) Capital surplus
Capital surplus represents surplus that is derived from capital transactions and includes capital legal reserve which is notdesignated as stated capital. Under the Companies Act of Japan (“the Companies Act”), at least one-half of the issue priceof shares is required to be accounted for as capital stock, and the remainder of the paid-in capital is accounted for as
capital surplus. The Companies Act also permits companies to transfer a portion of capital surplus to the capital stock byresolution of the shareholders’ meeting.
(3) Retained earnings
Retained earnings consist of legal reserve and other retained earnings. The Companies Act stipulates that one-tenth of theamount of surplus reduced by the dividends of surplus shall be set aside as capital legal reserve or earned legal reserve
until the sum of capital legal reserve and earned legal reserve equals one-fourth of the amount of stated capital. The
earned legal reserve may be used to reduce or eliminate a deficit by resolution of the shareholders meeting.
(4) Treasury stock
Changes in treasury stock were as follows:(Thousands of shares)
Previous fiscal year
(From January 1, 2020
to December 31, 2020
Number of treasury stock
Outstanding at the beginning of the fiscal year
Increase during the fiscal year
Decrease during the fiscal year
Outstanding at the end of the fiscal year

Current fiscal year
(From January 1, 2021
to December 31, 2021

26,917

26,920

4
(1)

5
(0)

26,92026,925The increase in the previous consolidated fiscal year and the current consolidated fiscal year are due to theacquisition of shares less than one unit, while the decrease is due to the additional purchase of shares less than one unit.

97This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(5) Accumulated other comprehensive income
Changes in accumulated other comprehensive income were as follows:(Millions of yen)

Remeasureme
nt of defined
benefit plans

Net changes infinancialassetsmeasured atfair value
through othercomprehensive
incomeCash flow
hedgesShare ofothercomprehensi
ve income ofequitymethodinvestees

－

4,963

(445)

－

4,517

7,662

(3,003)(2,157)－2,502(7,662)

(638)

－

－

(8,300)

－

－

2,268

－

2,268

Transfers to disposal groups held
for sale

－

107

－

－

107

Balance at December 31, 2020

－

1,430

(335)

－

1,095

Amount arising during the year

(395)

854

2,836

(12)

3,283

Reclassification from accumulated
other comprehensive income to

395

(784)

－

12

(378)

other comprehensive income tonon-financial asset－－(1,356)－(1,356)

Balance at December 31, 2021

－

1,499

1,145

－

2,644

Balance at January 1, 2020
(After Restatement)
Amount arising during the year
Changes in owners’ interest in
subsidiaries

Total

Reclassification from accumulated
other comprehensive income toretained earnings

retained earnings
Reclassification from accumulated

All amounts above are net of taxes.

98This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

21. Stock-based compensation
The Group has introduced a performance-linked stock-based incentive compensation system for the Company’s directors(excluding members of the Audit and Supervisory Committee and outside directors) and the executive officers of theCompany and its subsidiaries ("directors") since the current fiscal year.
1. Performance-linked stock-based incentive compensation system (“LTI”)(1) Outline of the LTI
The Company will provide directors with pay the Target Company's equity-settled share-based compensation to theTarget Company for three consecutive fiscal years (from January 1, 2020 to December 31, 2022). The performance
share units ("PSU") will be awarded for the evaluation periods of January 1, 2021 through December 31, 2023 andJanuary 1, 2021 through December 31, 2023). The Company's stock options and restricted stock units (hereinafterreferred to as "RSUs") are subject to the following. The purpose of the PSU is to further enhance the motivation of
Executive Directors to contribute to increases in the Company’s stock price and corporate value in the mid to longterm by sharing the merits and risks of stock price fluctuations with the shareholders.
(2) Vesting conditions(PSU)
・The number of shares to be issued shall be determined within the range of 0% to 150% of the basic PSU amount
depending on the achievement of performance targets (only considering companywide performance) over thethree years after the share units have been granted (half of the shares to be issued shall be paid in cash for the
purpose of allocating funds for the payment of tax obligations).
・To provide motivation to enhance corporate value over the mid to long term, consolidated ROE and consolidated
sales growth rate have been adopted as measures for evaluating performance, based on the Company’s policy
regarding the determination of compensation for Executive Directors and Executive Officers, etc.
(RSU)
・Provided for the purpose of aligning interests with shareholders, creating incentives to increase corporate value,and strengthening retention of talented people.
・A predetermined number of shares are issued at retirement (half of the shares to be issued shall be paid in cash
for the purpose of allocating funds for the payment of tax obligations).
(3) Fair value and fair value measurement methods
The fair value on the grant date of this plan for the previous consolidated fiscal year and the current consolidated
fiscal year were as follows:
Previous fiscal year
Current fiscal year
(As of December 31, 2020)(As of December 31, 2020)
PSU
RSU(Note) 1

2,117
2,117
1,887

(Note) 2

1,858
1,858
1,684

(Note) 1. Fair value related to special RSU.
2. Fair value for RSU covering employees.
2. Share compensation Expenses
For the current fiscal year, expenses of share-based payment included in "Selling, general and administrative expenses"
in the consolidated statements of profit or loss are 80 million yen and 227 million yen.

99

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

22. Dividends
Dividends payments were as follows:
For the year ended December 31, 2020
Resolution

Type of shares

Total amount ofdividends paid
(Millions ofyen)

Dividends per
share
(Yen)

Dividend record
date

Effective date

4,484

25

December 31,
2019

March 27, 2020

Total amount ofdividends paid
(Millions ofyen)

Dividends per
share
(Yen)

Dividend record
date

Effective date

4,484

25

4,484

25

March 26, 2020
Ordinary General
Meeting ofOrdinary
share

Shareholders
For the year ended December 31, 2021
Resolution

Type of shares

March 25, 2021
Ordinary General

Ordinary

Meeting of
Shareholders

share

August 11, 2021
Board of Directors

Ordinary
share

December 31,
2020

June 30, 2021

March 26, 2021

September 1,
2021

Among the dividends whose record date belongs to the current fiscal year, those whose effective date falls in thefollowing fiscal year are as follows:
Total amount
Dividends perType ofof dividends
Dividends
Dividend record
Resolution
share
Effective dateshares(Millions ofresources
date
(Yen)
yen)
March 24,
2022
Ordinary
GeneralMeeting ofOrdinary
share

4,484

Retainedearnings

Shareholders

100

25

December 31,
2021

March 25, 2022

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

23. Revenue(1) Revenue
The Group's organizational structure is based on the only one business Beverage segments. These two businesses arecomponents for which discrete financial information is available, and whose operating results are regularly reviewed by theentity’s chief operating decision maker to make decisions about resources to be allocated to the segment and assess its
performance. Therefore, the revenue in these two businesses is presented as “Revenue” in the consolidated financial
statement of profit or loss. In the Beverage business, the Group purchases, manufactures, and sells carbonated beverages
such as Coca-Cola, coffee beverages, black tea beverages, mineral water, alcohol and other beverages in Japan.
Revenue for sales of these products is recognized primarily at the time of delivery as customer has obtained control overthe products and the performance obligation is satisfied.
Payments relating to such performance obligation are received generally within two months of delivery. The contracts
with customer do not include any material financial elements.
The contract liabilities, refund liabilities, amount of assets recognized from the costs of obtaining a contract or to fulfil acontract and amount of revenue recognized from performance obligation satisfied in prior periods were immaterial. In
addition, information regarding the remaining performance obligation is omitted as there are no significant transactions inwhich the estimated individual contract periods exceed one year in the Group.

Previous fiscal year
(From January 1, 2020
to December 31, 2020)
Beverage

791,193

Other
Total

(Millions of yen)
Current fiscal year
(From January 1, 2021
to December 31, 2021)
785,455763

382

791,956

785,837(2) Contract balances
The Group’s contract balance consists primarily of receivables (Accounts and notes receivable) arising from contract
with customer and is presented in notes 7 "Trade and other receivables."24. Selling, general and administrative expenses
Selling, general and administrative expenses comprise the following(Millions of yen)Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

Depreciation

41,13638,557

Amortization
Sales commissions and promotional expenses

2,798
97,3393,085
104,965

Employee benefits expenses
Shipping and commissions

103,538
72,62895,373
77,964Maintenance fee
Other14,13528,072

14,321
29,486359,645

363,750

Total

101

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

25. Employee benefits expenses
Employee benefits expenses consisted of the following:(Millions of yen)Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

Cost of sales

Selling, generalandadministrative
expenses

Cost of sales

Selling, generalandadministrative
expenses

Salaries and wages

9,331

71,212

9,106

60,450Welfare and legal welfare expenses
Bonus

983
1,083

8,711
10,129

1,074
1,733

8,674
13,839Retirement benefit costs

1,401

13,485

1,507

12,411

Total

12,797

103,538

13,42095,373

26. Other income and other expense
Other income and other expense consisted of the following:(Millions of yen)Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

Other income
Gains on sales of property, plant and equipment
Rent income

5,201
344

1,519
310

Government subsidies (Note 1)
Gain on sales of stocks of subsidiaries and

2,520

6,447

－

708

421

1,154

8,486

10,138affiliates (Note 2)
Other
Total
Other expense
Impairment losses

1,075

744

Losses on sales and disposals of property, plant andequipment

4,631

2,102

Transformation-related expenses (Note 3)
Special retirement allowance (Note 4)

4,546
7,969

1,600
2,437

Temporary paid leave expenses (Note 5)
Product valuation losses (Note 6)

3,923
255

9,001
－

Costs of postponing the Olympics (Note 7)
System failure-related costs (Note 8)

125
－

－
1,322

Other

711

496

23,23517,702

Total(NOTE) 1. Government subsidies are grants to cover employee’s temporary leave cost due to the spread of COVID-19.
2. Gain on sales of stocks of subsidiaries and affiliates represents the gain on sales of all stocks of Apex Nishi-Nihon
Corporation, an equity-method affiliate of the Company.
3. Transformation related expenses are expenses related to measures aimed at building an efficient new system with the aimof creating more value and further improving productivity for the sustainable growth of the Group.
4. Special retirement allowances are allowances and outplacement support expenses incurred in the implementation of thevoluntary retirement program.
5. Temporary paid leave expenses are the allowance associated with employee’s temporary leave to respond to the impact toour business by the economic contraction and to secure the safety and health of our employee following the state of emergency
declaration due to the spread of COVID-19. The expenses are reclassified 432million yen and 656 million yen from cost of102

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

sales and 3,492 million yen and 8,345 million yen from selling and general administrative expenses to other expenses,
respectively.
6. Product valuation losses are a valuation loss of product inventory at the time of the emergency declaration of the government
to prevent COVID-19 outbreak. This is because the product inventory is planned to be disposed due to the effects of thesuspension of operation of restaurants. The losses are reclassified from cost of sales.
7. Costs of postponing the Olympics were incurred by the postponement of the Olympic and Paralympic Games due to COVID19. The expenses are mainly for hotels and warehouses cancellation fees and reclassified from selling and generaladministrative expenses.
8. System failure-related costs are expenses incurred to recover the system failures that occurred in the core system used by theGroup.
27. Financial income and financial expense
Financial income and finance expense consisted of the following:(Millions of yen)Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

Financial income
Interest income
Financial assets measured at amortized cost
Dividends income
Financial assets measured at fair value through othercomprehensive income
Foreign exchange gains
Other
Total

0

1

431

259

239

－

97

117

767

377

1,084
－

928

Finance expense
Interest expenses
Financial liabilities measured at amortized cost.
Foreign exchange losses
Other
Total

103

26

111
50

1,110

1,089

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

28. Income taxes(1) Deferred tax assets and deferred tax liabilities
The breakdown of major causes of deferred tax assets and deferred tax liabilities in the previous fiscal year and thecurrent fiscal year is as follows:(Millions of yen)
The consolidated statement of financial position

Consolidated statement of profit or loss

Previous fiscal year
(As of December 31,
2020)

Current fiscal year
(As of December 31,
2021)

Previous fiscal year
(From January 1,
2020
to December 31,
2020

Current fiscal year
(From January 1,
2021
to December 31,
2021

5,530

5,246

(330)

(283)

Lease

10,497

7,162(2,625)(3,335)

Financial assets

2,147

1,313

(27)

37

Employeebenefits

8,499

9,992

(524)

1,285

Inventories
Carryforwards

1,889

2,184

411

295

of unused tax
losses7,879

13,893

6,708

6,014

Other

4,060

3,642

1,818

(418)

40,50043,432

5,431

3,595

(35,841)(34,319)

637

1,522

(10,159)(4,071)(6,983)(3,619)

2,772
909

3,176
302

－

－

0

－

(2,739)(1,930)

(183)

809

(52,810)(46,851)

4,135

5,809

－

－

9,565

9,404

(12,309)(3,419)Deferred tax
assetsProperty, plantand equipment
and intangible
asset

Subtotal
Deferred tax
liabilities
Property, plantand equipment
and intangible
asset
Lease
Financial assets
Employeebenefits
Other
Subtotal
Total deferred tax
expenseTotal deferredtaxes

The Group evaluates the recoverability of deferred tax assets by considering the possibility that some or all ofdeductible temporary differences or carryforwards of unused tax losses will be available to future taxable income. Basedon historical trends in taxable income and projected future taxable income for the periods in which deferred tax assets arerecognized, the Group believes that it is more likely than not that the tax benefits of these deferred tax assets will be
realized at the end of the previous and current fiscal years.
In Company incurred special retiremethe previous and current fiscal years, thent benefits and the effects of the newcoronavirus infection. The Company has incurred a loss carried forward for tax purposes. The loss carried forward for104

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

tax purposes mainly resulted from a consolidated subsidiary, Coca-Cola Bottlers Japan Inc., which is a consolidated
subsidiary of the Company. Deferred tax assets of 13,861 million yen were recognized for the tax loss carryforwards.
Note 4 "Critical Accounting Judgments, Estimates, and as described in "Assumptions and Liabilities", in recognizing
deferred tax assets, the Group has recognized deferred tax assets based on the medium-term plan. The timing and amountof the accrual are estimated. Estimates of future taxable income are based on the medium-term plan, and the main
assumptions used are as follows the sales plan and cost plan for the relevant period are used as the basis for the calculation.
In assessing the recoverability of deferred tax assets, the projected the reversal of deferred tax liabilities, projected futuretaxable income, and tax planning are taken into consideration. In addition, the Company considers the possibility of new
The Company has assumed that the effects of the coronavirus infection will continue for a period of time beyond thefiscal year ending December 31, 2022.
The Group believes that changes in the economic environment surrounding the Group, market conditions and otherfactors will increase the uncertainty of our estimates of future taxable income.
Details of changes in deferred tax assets and deferred tax liabilities (net) in the previous fiscal year and the current
fiscal year are as follows:(Millions of yen)Previous fiscal year
(From January 1, 2020
to December 31, 2020
Balance at the beginning of the fiscal year (after
restatement) (liabilities)
Amounts recognized in deferred tax expense
Amounts recognized in deferred tax expense(Discontinued operations)
Amounts recognized in other comprehensive income

Current fiscal year
(From January 1, 2021
to December 31, 2021

(18,782)(12,309)

9,565

9,404

8

－

(2,220)Transfer to disposal group held for sale

(880)

(514)
－

Balance at the end of the year (liabilities)(12,309)(3,419)(2) Unrecognized deferred tax assets and deferred tax liabilities
As a result of our assessment of the recoverability of the deferred tax assets described above, the Group does notrecognize the deferred tax assets for a portion of deductible temporary differences. The amounts of deductible temporary
difference and carryforwards of unused tax losses for which no deferred tax assets has been recognized as of the end of
the previous fiscal year and the end of the current fiscal year are as follows:(Millions of yen)Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

15,856－

15,545－15,856

15,545

Deductible temporary differences
Carryforwards of unused tax losses
Total

105

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Taxable temporary differences regarding investments in subsidiaries and associates for which deferred tax liabilities
was not recognized at the end of the previous fiscal year and at the end of the current fiscal year is as follows:(Millions of yen)Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

52,84038,724

Investments in subsidiaries and associates(3) Income tax expenses
Income tax expenses for the previous fiscal year and the current fiscal year consisted of the following.
(Millions of yen)Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

4,648

3,005

Deferred tax expenses (profit)(9,565)(9,658)

Total(4,918)(6,653)Current tax expenses

The above deferred tax expenses were primarily due to the origination and reversal of temporary differences.
(4) Reconciliation of effective tax rate
A reconciliation of the statutory tax rate to the applicable tax rate in the consolidated statements of profit or loss forthe previous fiscal year and the current fiscal year is as follows:
Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

31.46%

31.46％

Items which are not taxable or deductible
Changes in unrecognized deferred tax assets (Note)(1.08)%
7.68%

22.54％
0.41％

Tax rate difference between the Company andsubsidiaries

3.14%

2.47％

－
(0.45)%(23.95)%(2.24)％

40.76%

30.68％

Statutory tax rate

Tax expense related to the sale of shares of a subsidiary
Other
Applicable tax rate

Note: 1. The change in unrecognized deferred tax assets in the previous fiscal year was mainly due to the effect of the change in the
tax effect related to unrecognized land write-downs as a result of the sale of the land.
2. See Note 9, "Disposal Groups Classified as Held for Sale and Discontinued Operations," for more information on the tax
expense related to the sale of shares in subsidiaries.

106

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

29. Other comprehensive income
The components of other comprehensive income and related tax effects (including non-controlling interest) are as follows:(Millions of yen)Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

Items that will not be reclassified to profit or loss
Remeasurement of defined benefit plans:
Amount arising during the year

11,704(603)

Tax effect(4,043)208

Net of tax

7,662

(395)

Amount arising during the year
Tax effect

－
－

(12)
－

Net of tax

－

(12)

(4,406)

1,396

Tax effect

1,403

(542)

Net of tax(3,003)

854

4,659

448

Share of other comprehensive income in equity method
investees:

Financial asset measured at fair value through othercomprehensive income:Amount arising during the year

Subtotal
Cash flow hedge:
Amount arising during the year

(3,298)

4,335

Tax effect

1,141(1,499)Net of tax(2,157)

2,836

Subtotal(2,157)

2,836

Total other comprehensive income

2,502

3,283

107

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

30. Reconciliation of changes in liabilities related to cash flows arising from financing activities
Changes in liabilities related to financing activities were as follows:(Millions of yen)

Balance as of January 1, 2020
Changes with cash flows
Changes without cash flows
Transfers to disposal groups
held for sale

Short-term loans
payableLong-term loans
payable (Note)－
50,000－－Bonds (Note)

Lease liabilities

10,346(1,274)－

195,402(16,000)

40,773(7,296)

111

(829)

－

－

(1,243)

Balance at December 31, 2020

50,000

9,072

179,514

31,405

Changes with cash flows(1,072)－－(7,088)Changes without cash flows(50,000)
－

99

2,196

Balance at December 31, 2021

－

8,000

179,61226,512(NOTE) These include amounts of long- term loan and bond due within one year.
31. Financial instruments(1) Financial risk management
The Groups are exposed to the following risks arising from financial instruments:
・Credit risk
・Liquidity risk
・Market risk
The Group faces a variety of financial risks (credit risk, liquidity risk and market risk (equity price risk, interest raterisk, currency risk and commodity price risk) in the course of conducting business and manages risks in accordance withcertain policies to avoid and mitigate these financial risks. The Group's risk management policies are formulated after
identifying and analyzing the risks faced by the Group with the aim of appropriately identifying risks and controls andmonitoring risks and complying with controls. Risk management policies and systems are reviewed periodically to reflectmarket conditions and the Group's business activities. The Group conducts training and develops manuals and procedures
to maintain a control environment in which all employees understand their roles and disciplines.
Based on our risk management policies, the group utilizes derivative transactions to hedge certain risk exposures. The
Group's policy is to utilize derivative transactions to hedge foreign currency exchange and commodity price risks and not
to engage in speculative transactions. Our finance division identifies, evaluates and hedges financial risk.
(2) Credit risk
Credit risk is the risk that one party to the financial instrument will be unable to perform its obligations and anotherparty will incur financial losses. In the course of our business, the Group is exposed to counterparty credit risk withrespect to trade and other receivables and other financial assets (including deposits, securities and other receivables). The
carrying amount after impairment for financial assets presented in the consolidated financial statements is the maximum
exposure of the Group of financial assets to credit risk, without taking into account of any collateral held. In addition, theGroup has no significant credit risk exposure to any particular counterparty and has no excessive concentration of credit
risk with specific managements.
In order to manage credit risk, the Group manages payment due dates and outstanding for each customer in accordancewith our internal customer control regulations and monitor the credit standing of our major customer on a regular basis.
In order to mitigate the credit risk of derivative transactions, in principle, transactions are limited to financial institutions
with high credit ratings.
In addition, the Group calculates allowance for credit loss by classifying receivables based on credit risk characteristics.
For trade and lease receivables, the Group always measurements allowance for credit loss at the same amount as lifetime
expected credit losses. Receivables other than trade and lease receivables, in principle, are measured the allowance for
credit loss at the same amount as the 12-month expected credit losses. However, if credit risk increases significantly fromthe initial recognition date, the Group recognizes the allowance for credit losses at the same amount as the lifetime
expected credit losses. The Group determines whether or not the credit risk has increased significantly based on
fluctuations in the risk of default, and consideration of the passage of time and deterioration in the financial condition of
the obligor. All receivables other than trade receivables for which the Group measures the allowance for credit loss at the108

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

same amount as the 12-month expected credit losses are measured on a collective basis.
The amount of expected credit losses related to trade receivables is calculated based on simplified approaches byclassifying receivables according to the credit risk characteristics of the counterparty and multiplying by the provision
rate reflected historical credit loss rate calculated for each category and forecasts of future economic conditions.
The amount of expected credit losses related to receivables other than trade receivables whose credit risk has notincreased significantly is calculated based on the principle approach by multiplying by provision rate reflected thehistorical rate of credit loss of the same type of asset by its carrying amount. The amount of expected credit losses related
to asset whose credit risk has been increased significantly and credit-impaired financial asset is calculated as thedifference between the present value of estimated future cash flows discounted by the asset's initial effective interest rateand carrying amount.
(a) Credit risk exposure
The Group's credit risk exposure is as follows:
Trade and other receivables
The Group evaluates the credit risk of trade and other receivables based on past due information.
As of December 31, 2020
(Millions of yen)
Financial asset
assessed by
12-month
expected
credit losses
Unexpired

23,663

Within 60 days of the due dateMore than 60 days from the due date
Total

66
－
23,729Financial asset
assessed by anamount equal
to lifetime
expected
credit losses
30－

Financial assetof applying
simplified
approaches

Total

68,55692,249

65

4,022
－

4,088
65

94

72,57896,401

Financial asset assessed by an amount equal to lifetime expected credit losses is primarily a creditimpairment financial asset.
As of December 31, 2021
(Millions of yen)
Financial asset
assessed by
12-month
expected
credit losses
Unexpired33,149Within 60 days of the due dateMore than 60 days from the due date
Total

17
－
33,166

Financial asset
assessed by anamount equal
to lifetime
expected
credit losses
98－

Financial assetof applying
simplified
approaches

Total

67,796

101,043

8

4,611
43

4,628
51

106

72,450105,721

Financial asset assessed by an amount equal to lifetime expected credit losses is primarily a creditimpairment financial asset.
Other financial assets
The Group evaluates the credit risk of other financial assets according to the credit risk rating grades of the otherparty. The credit risk rating grades of financial asset assessed by an amount equal to lifetime expected credit losses
is relatively low compared to the credit risk rating grades of financial asset's expected credit losses, which assessedby a 12-month expected credit losses, and the credit risk rating grades of financial assets in the same category is
generally the same.

109

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

None of the other financial assets past due have significant credit risk exposures.
As of December 31, 2020
(Millions of yen)
Financial asset
assessed by 12-month
expected credit losses
Other financial asset

Financial asset
assessed by anamount equal tolifetime expectedcredit losses

5,053

Total

1,194

6,247

Financial asset assessed by an amount equal to lifetime expected credit losses is primarily a credit-impairment
financial asset.
As of December 31, 2021
(Millions of yen)
Financial asset
assessed by 12-month
expected credit losses
Other financial asset

Financial asset
assessed by anamount equal tolifetime expectedcredit losses

4,714

Total

1,204

5,918

Financial asset assessed by an amount equal to lifetime expected credit losses is primarily a creditimpairment financial asset.
(b) Allowance for credit losses
Changes in allowance for credit losses were as follows:
Trade and other receivables
For the year ended December 31, 2020
(Millions of yen)
Financial asset
assessed by
12-month
expected
credit losses

Financial asset
assessed by anamount equal
to lifetime
expected
credit losses

Financial assetof applying
simplified
approaches

Balance at January 1, 2020
Provision

35
42

53
216

178
175

265
433

Reduction during the period (reversal)
Transfers to asset groups classified as held for

(35)

(53)

(178)

(265)

(0)

－

(41)

(41)

42

216

134

392

Financial asset
assessed by
12-month
expected
credit losses

Financial asset
assessed by anamount equal
to lifetime
expected
credit losses

Financial assetof applying
simplified
approaches

Balance at January 1, 2021

42

216

134

392

Provision
Reduction during the period (reversal)

51
(42)

51
(216)

298
(134)

401
(392)

Balance at December 31, 2021

51

51

298

401

sale
Balance at December 31, 2020

Total

For the year ended December 31, 2021
(Millions of yen)

Total

The Group does not anticipate that any cash flows will be collected in the future from trade receivables written
off in the past and not collect any cash flows.
110This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Other financial asset
For the year ended December 31, 2020
(Millions of yen)
Financial asset
assessed by 12-month
expected credit losses
Balance at January 1, 2020
Provision

0
0－

Financial asset
assessed by anamount equal tolifetime expectedcredit losses

Total

709
202

709
202

(0)

(74)
(207)

(74)
(208)

Transfers to asset groups classified as held
for sale

(0)

(40)

(40)

Balance at December 31, 2020

0

589

590

Decrease during the period (intended use)
Reduction during the period (reversal)

For the year ended December 31, 2021
(Millions of yen)
Financial asset
assessed by 12-month
expected credit losses
Balance at January 1, 2021
Provision

00－Decrease during the period (intended use)
Reduction during the period (reversal)
Balance at December 31, 2021

Financial asset
assessed by anamount equal tolifetime expectedcredit losses

Total

589
1,036

590
1,036

(0)

(68)
(742)

(68)
(742)

0

816

816

(c) Impact of significant changes in the gross carrying amount of financial instrument during the year
There were no significant changes in the gross carrying amount affecting changes in allowance in the previous fiscal
year or the current fiscal year.

111

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(3) Liquidity risk
Liquidity risk is the risk that the Group will be unable to pay its obligations on the due date for repayment in thefinancial liabilities when such obligations become due. The Group manages to secure sufficient funds to meet payment
due dates under any circumstances that do not affect the Group's conditions of loss or reputation. Our financial division
manages our liquidity risk by maintaining adequate levels of net income and cash balances within our line of credit withbanks and by comparing and analyzing actual cash flows and forecast cash flows.
The balances of financial liabilities (including derivative liabilities) by maturity were as follows:
As of December 31, 2020
(Millions of yen)
Later than 1
year and notlater than 5
years

Carrying
amountCash flows
on contract

Not later than
1 yearMore than 5
years

Trade and other payables
Bonds and loans payable

102,480
238,585

102,480
241,511

102,480
51,591－－75,255

114,665

Finance lease liabilities
Derivative financial liabilities

31,40533,121

5,991

11,041

16,090Forward exchange contracts
Commodity swap

886
127

886
127

513
127

373
－

－
－

373,483

378,125

160,701

86,669130,755

Later than 1
year and notlater than 5
years

More than 5
years

Non-derivative financial liabilities

Total
As of December 31, 2021

(Millions of yen)
Carrying
amountCash flows
on contract

Not later than
1 yearTrade and other payables
Bonds and loans payable

103,260
187,612103,260
189,920

103,260
31,385－－

108,130

50,405

Finance lease liabilities

26,51227,502

4,157

11,096

12,249317,385

320,683

138,803119,226

62,654Non-derivative financial liabilities

Total(4) Market risk
Market risk is the risk of fluctuations in interest rates, stock prices and other market prices that may affect the value of
the Group’s revenue and value of securities held by the Group. While optimizing profits, the Group manages market risk
exposures to acceptable levels.
(a) Interest rate risk
Loans payable and bonds are fixed interest rates. Accordingly, the impact of changes in interest rates on profit orloss is limited and the Group believes that our interest rate risk is insignificant and has not performed sensitivity
analyses such as basis point values.
(b) Stock price risk
The Group is exposed to the risk of fluctuations in stock prices because the Group hold a large number of securities
with quoted market prices. Securities with quoted market prices are held for purposes other than trading and aredesignated primarily as financial asset measured at fair value through the other comprehensive income.
Assuming that all other variables are constant, if the price of listed securities held by the Group as of the end of the
fiscal year increases or decreases by 10%, the impact on the other comprehensive income (before tax effects) is 1,534
million yen and 944 million yen, respectively, for the previous fiscal year and current fiscal years.

112This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(c) Currency risk
The Coca-Cola Bottlers Japan Co., Ltd., a consolidated subsidiary, purchases raw materials denominated in foreign
currencies and is therefore exposed to currency risk, mainly in U.S. dollars. Currency risk arises from forecast
transaction, such as future purchases, or from assets and liabilities that are already recognized. The Group utilizes
foreign currency forward contracts to hedge its currency risk. Hedge accounting is applied to transactions that meetthe criteria for hedge accounting. Receivables and payables denominated in foreign currencies are exposed to the riskof exchange rate fluctuations, but the impact of this risk is limited as it is offset by forward exchange contracts.
(d) Commodity price risk
The Coca-Cola Bottlers Japan Co., Ltd., a consolidated subsidiary, purchases raw materials that are subject tofluctuations in prices due to weather and natural disasters. As a result, the Group is exposed to the commodity pricerisk of raw materials. The Group enters into commodity swap contracts to hedge the risk of fluctuations in the pricesof these raw materials.
(5) Capital management
The Group’s fundamental capital management policy is to improve capital efficiency through long-term improvements
through business growth while maintaining a stable financial position.
The Group’s indicators for capital management are return on equity attributable to owners of the parent (“ROE”) andreturn on assets (“ROA”). ROE is the ratio of net profit to equity attributable to owners of the parent, and ROA is theratio of profit before tax to total assets.
Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

ROE(0.94)%(0.50)%

ROA(1.28)%(2.40)%The Group does not have any significant capital controls imposed by external parties.

113

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(6) Classification of financial instruments
Balances by financial assets and financial liabilities classification were as follows:
Financial assets
As of December 31, 2020
(Millions of yen)
Financial
instrument
measured atfair value
through profit
or loss

Financial
instrument
measured atfair value
through othercomprehensiv
e income

Financial
instrument
measured atamortized cost

Cash and cash equivalents－－

114,778

114,778

Trade and other receivables
Other financial asset (current)－－

96,00996,009

518

－

－

518

－

－

5

5

－

－

78

78

－

－

101

101

518

－

184

702

－

－
－

136
19,898Derivative assets
Term deposits which mature due within
three months
Current portion of long-term loans
receivable
Other
Subtotal
Other financial asset (non-current)

Total

Derivative assets
Securities

136－

Long-term loans receivable－

19,898
－

50

50

Other

－

133

5,424

5,557

Subtotal

136

20,031

5,473

25,640Total

654

20,031

216,445

237,130

114

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

As of December 31, 2021
(Millions of yen)
Financial
instrument
measured atfair value
through profit
or loss

Financial
instrument
measured atfair value
through othercomprehensiv
e income

Financial
instrument
measured atamortized cost

Cash and cash equivalents
Trade and other receivables

－
－

－
－

110,497
105,320

110,497
105,320

Other financial asset (current)
Derivative assets

1,303

－

－

1,303

Term deposits which mature due within
three months

－

－

5

5

Current portion of long-term loans
receivable

－

－

12

12

Other

－

－

－

－

1,303

－

17

1,320

Derivative assets
Securities

560
－

－

560
13,726Long-term loans receivable－

13,726
－

－
－
36

36

Other

－

140

5,049

5,189

Subtotal

560

13,866

5,085

19,511

Total

1,863

13,866

220,919

236,648

Subtotal
Other financial asset (non-current)

Total

Financial liabilities
As of December 31, 2020
(Millions of yen)
Financial instrument
measured at fair value
through profit or loss

Financial instrument
measured atamortized cost

Trade and other payables－

102,480

102,480

Bonds and loans payable
Lease liabilities－－

238,585
31,405

238,585
31,405

Other financial liabilities (current)
Derivative liabilities

408

－

408

408

－

408

605

－

605

Subtotal
Other financial liabilities (non-current)
Derivative liabilities

Total

Subtotal

605

－

605

Total

1,013

372,470

373,483115

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

As of December 31, 2021
(Millions of yen)
Financial instrument
measured at fair value
through profit or loss

Financial instrument
measured atamortized cost

Trade and other payables－

103,260

103,260

Bonds and loans payable
Lease liabilities－－

187,61226,512

187,61226,512

Total－

317,385

317,385

Total

Since the Group holds securities for strategic investment purposes, these securities are designated as equity
instrument measured at fair value through the other comprehensive income.
The following is a fair value of the major issues of equity instrument measured at fair value through othercomprehensive income.
(Millions of yen)
Issue

Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

Nishi-Nippon Railroad Co., Ltd.

1,218

1,044

Central Japan Railway Company
East Japan Railway Company

789
792

830
813

Seven & i Holdings Co., Ltd.
IZUMI Co., Ltd.

526
864

748
746

Oriental Land Co., Ltd.

579

661

Dividends income related to investments held at the reporting date was as follows:(Millions of yen)Previous fiscal year
(From January 1, 2020
to December 31, 2020)
Dividends income

Current fiscal year
(From January 1, 2021
to December 31, 2021)

422

189

The Group disposed a part of the equity instrument designated as measurement at fair value through othercomprehensive income during the fiscal year from the viewpoint of reviewing business relationships. The fair value,
the cumulative gains or losses (before tax effects) at the time of disposition and the dividends income were as follows:(Millions of yen)Previous fiscal year
(From January 1, 2020 to December 31, 2020)
Fair value
3,235

Cumulative gain
(Loss)
1,091

Current fiscal year
(From January 1, 2021 to December 31, 2021)

Dividends
incomeFair value
73

7,612

Cumulative gain
(Loss)

Dividends
income

1,577

Cumulative gains or losses recognized in accumulated other comprehensive income are reclassified fromaccumulated other comprehensive income to retained earnings at the time of disposition.
Reference: Note 20. Equity (5) Accumulated other comprehensive income

116

70

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(7) Fair value of financial instruments(a) Classification by level of the fair value Hierarchy
Financial instruments measured at fair value on a recurring basis after initial recognition are classified into threelevels of the fair value hierarchy, depending on the observability and significance of the inputs used in the measurement.
The fair value hierarchy is defined as follows:
Level 1: fair value (unadjusted) in the active market of the same asset or liability
Level 2: fair value based on inputs other than quoted prices included in Level 1, either directly observable inputs orindirectly, of observable inputs for asset or liability
Level 3: fair value based on unobservable inputs for asset or liability
When more than one inputs is used to measurement the fair value, the level of the fair value hierarchy is determinedbased on the lowest level of inputs that is significant to the fair value measurement as a whole. Transfers between
levels of the fair value hierarchy are recognized as having occurred at the beginning of each quarter.
There were no transfers between Level 1 and Level 2 during the previous fiscal year and current fiscal years.
(b) Fair value measurement
Securities are classified as Level 1 of the fair value hierarchy by the measurement of share prices, if any, in active
market for the same asset or liability. If there is no active market stock price for the same asset or liability, the Group
uses valuation techniques such as stock prices in non-active markets, quoted market prices of similar companies anddiscounted future cash flows models. If significant inputs, such as quoted market prices and discount rates used inmeasurement are observable, such financial instruments are classified as Level 2, but are classified as Level 3 if inputs
used its measurement include significant unobservable inputs.
Unlisted securities are classified into Level 3 of the fair value hierarchy using valuation techniques based on
discounted future cash flows, valuation techniques based on quoted market prices of similar companies, valuation
techniques based on net asset value, and other valuation techniques. In the fair value measurement of unlisted securities,
the Group uses unobservable inputs such as discount rates and valuation multiples and considers certain illiquidity
discounts and non-controlling interest discounts as needed. The measurement methods for such fair value aredetermined by the finance division in accordance with the Group’s accounting policies.
The valuation techniques and significant unobservable inputs used in Level 3 fair value measurement are as follows:
As of December 31, 2020
Type

ValuationtechniqueSignificant unobservable inputs

Interactions between significant
unobservable inputs and fair value
measurement

Comparison

EBIT Multiple: 6.7-46.7 times

Estimated fair value increases (decreases)of similar
companies

EBITDA Multiple: 12.6 times
PBR: 1.0-3.0 times

when equity indices of comparable listedcompanies of the target are high (low)ValuationtechniqueSignificant unobservable inputs

Interactions between significant
unobservable inputs and fair value
measurement

Comparison

EBIT Multiple: 5.2-51.0 times

Estimated fair value increases (decreases)of similar
companies

EBITDA Multiple: 5.9 times
PBR: 0.9-2.6 times

when equity indices of comparable listedcompanies of the target are high (low)Financial
instrument
measured at fairvalue through othercomprehensive
income (Securities)
As of December 31, 2021
Type
Financial
instrument
measured at fairvalue through othercomprehensive

income (Securities)
EBIT Multiple: Corporate Value/EBIT
EBITDA Multiple: Corporate Value/EBITDAPBR: Price Book Value Ratio

117

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(c) Financial instrument measured fair value on a recurring basis
The breakdown of financial instrument measured at fair value on a recurring basis is as follows:
As of December 31, 2020
(Millions of yen)
Level 1

Level 2

Level 3

Total

Financial assets
Financial instrument measured at fair value
through profit or loss:
－

654

－

654

－

654

－

654

15,337－－

4,561

19,898

－

133

133

Derivative assets
Subtotal
Financial instrument measured at fair value
through other comprehensive income:Securities
Other
Subtotal

15,337－

4,694

20,031

Total

15,337654

4,694

20,685

－

1,013

－

1,013

－

1,013

－

1,013

Financial liabilities
Financial instrument measured at fair value
through profit or loss:
Derivative liabilities
Total
As of December 31, 2021
(Millions of yen)
Level 1

Level 2

Level 3

Total

Financial assets
Financial instrument measured at fair value
through profit or loss:－

Derivative assets
Subtotal

1,863

－

1,863

－

1,863

－

1,863

9,443
－

－

4,283

13,726

－

140

140

Financial instrument measured at fair value
through other comprehensive income:Securities
Other
Subtotal

9,443

－

4,423

13,866

Total

9,443

1,863

4,423

15,729

－

－

－

－

－

－

－

－

Financial liabilities
Financial instrument measured at fair value
through profit or loss:
Derivative liabilities
Total

The main valuation techniques used to fair value measurement the financial instruments in the table above are as follows:a. Securities
Listed securities are measured based on quoted market prices and are classified into fair value hierarchy level 1.
b. Derivatives
The fair value of foreign currency forward contracts is calculated by discounting the value calculated using theforward exchange rate as of the end of the reporting period to the present value. As a result, foreign currency forward
contracts are classified into fair value hierarchy level 2.
118

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

A reconciliation of the beginning and ending balances of financial instrument classified as Level 3 is as follows:(Millions of yen)
Financial assets measured at fair value through othercomprehensive income
Balance at January 1, 2020
Purchase

5,392－

Disposals
Gains or losses recognized in other comprehensive income

(8)
(441)

Transfers to disposal groups held for sale(249)

Balance at December 31, 2020

4,694

Purchase
Disposals

2(27)

Gains or losses recognized in other comprehensive income(246)

Balance at December 31, 2021

4,423

Gains or losses recognized in other comprehensive income are recognized in "Net changes in financial asset
measured at fair value through other comprehensive income" in the consolidated statements of comprehensive income.
(d) Financial instrument measured at amortized cost
The components of carrying amount and fair value of financial instruments measured at amortized cost are as
follows:
As of December 31, 2020
(Millions of yen)
Carrying amountLong-term loans payable and bonds

188,585

Fair value

Difference

188,075

510

As of December 31, 2021
(Millions of yen)
Carrying amountLong-term loans payable and bonds

187,612Fair value
187,982

Difference(370)

Long-term loans payable and bonds include current portion. Cash and cash equivalents, trade and other receivables,
trade and other payables, and short-term loans payable are not included in the above table because their fair value
approximates its carrying amount because they are collected and settled in a short period of time.
The main valuation techniques used to fair value measurement the financial instruments in the table above are as
follows:
a. Loans payable
Loans payable with variable interest rates are calculated the carrying amount as its fair value because interest rates
are considered to reflect market interest rates in the short term. Loans payable with fixed interest rates is calculated
based on the present value of future cash flows discounted using interest rates adjusted for remaining term and credit
risk. Loans payable with variable interest rates and fixed interest rates are classified into level 2 of the fair value
hierarchy.
b. Bonds
For bonds with quoted market prices, the fair value is estimated based on quoted market prices. For bonds without
quoted market prices, the fair value is calculated based on the present value of future cash flows discounted using
interest rates adjusted for the remaining term and credit risk. Bonds with quoted market prices are classified intolevel 1 of the fair value hierarchy and bonds without quoted market prices are classified into level 2.

119This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(8) Derivatives and hedge accounting
The management of hedge accounting for the risk management of the Group is described in "(1) Financial risk
management". Derivative transactions are conducted by Coca-Cola Bottlers Japan Inc.
(a) Impacts on the consolidated statements of financial position
The impact of hedging instrument designated as hedges on the consolidated statements of financial position was asfollows: The carrying amount (fair value) of assets related to hedging instrument is included in "Other financial assets"
and the carrying amount (fair value) of liabilities related to hedging instrument is included in "Other financial
liabilities".
As of December 31, 2020
(Millions of yen)
Hedge typeHedging
instrument

Risk category

Carrying amount (fair value)
AssetsLiabilities

ForwardCurrency
Cash flow hedges

Notional
amountrisk

exchange
contracts

Price risk

Commodity
swap
Total

25,042

－

886

7,868

654

127

32,910654

1,013

The average exchange rate used for forward exchange contracts was 105.42 yen per U.S. dollar.
As of December 31, 2021
(Millions of yen)
Hedge typeHedging
instrument

Risk category

Forwardexchange

Currencyrisk

Cash flow hedges

Notional
amountcontracts
Commodity

Price risk

swap
Total

Carrying amount (fair value)
AssetsLiabilities

10,007

730

－

4,816

1,133

－

14,823

1,863－

The average exchange rate used for forward exchange contracts was 106.17 yen per U.S. dollar.
In hedging transactions conducted by the Group, the entire hedged item items are hedged, and there are notransactions to hedge certain risk elements.
The periods of hedge for cash flows movements of foreign currency forward contracts and commodity swaps arefrom February 2022 to January 2024 and from January 2022 to January 2023, respectively.
Accumulated other comprehensive income related to cash flow hedges was as follows: There were no accumulated
other comprehensive income related to cash flow hedges arising from hedge relationships that discontinued hedge
accounting.
(Millions of yen)Previous fiscal year
(As of December 31, 2020)
Forward exchange contracts
Commodity swap
Total

120

Current fiscal year
(As of December 31, 2021)
(634)
299

449
696

(335)

1,145

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(b) Impact on the consolidated statements of profit or loss and consolidated statements of comprehensive income
The impacts on profit or loss and other comprehensive income related to hedging instrument designated as cash
flow hedges were as follows:
For the year ended December 31, 2020
(Millions of yen)Amounts
reclassified fromaccumulated othercomprehensive
income to profit orloss asreclassification
adjustments

Amount of hedging
gains or losses
recognized in othercomprehensive
incomeHedge
ineffectivenessrecognized in profit
or loss

Changes in fairvalue of hedging
instrument used as
the basis forrecognizing thehedge ineffective

Currency risk
Price risk

(1,123)(2,175)

31
－

(886)
526

－
－

Total

(3,298)

31

(359)

－

Risk category

For the year ended December 31, 2021
(Millions of yen)Amounts
reclassified fromaccumulated othercomprehensive
income to profit orloss asreclassification
adjustments

Amount of hedging
gains or losses
recognized in othercomprehensive
incomeHedge
ineffectivenessrecognized in profit
or loss

Changes in fairvalue of hedging
instrument used as
the basis forrecognizing thehedge ineffective

Currency risk
Price risk

965
3,370

5
－

730
1,133

－
－

Total

4,335

5

1,863

－

Risk category

Changes in the value of the hedged item used as the basis for recognizing the hedge ineffectiveness approximatechanges in the fair value of hedging instrument.
There are no reclassification adjustments due to discontinuation of hedges, etc. If hedged item is a forecast
transaction, such as acquisition of inventories, accumulated gains or losses on hedges in "Accumulated othercomprehensive income" are reclassified to cost of inventories and other.
The hedge ineffective portion recognized in profit or loss and the amount reclassified to profit or loss as
reclassification adjustments are included in finance income and finance expenses.
Because the terms between hedged item and hedging instrument are not perfectly matched, the differences in terms
result in the hedge ineffective portion.

121

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

32. Significant subsidiaries
Significant subsidiaries of the Groups are as follows: Unless otherwise indicated, subsidiary's capital consists of ordinary
share directly owned by the Group and its percentage ownership is the same as the percentage of voting power owned by
the Group. The principal business locations are the same as those of the Company.
Percentage of voting rightOperatingsegment

Name ofsubsidiary
Coca-Cola

Beverage

Bottlers JapanInc.

business

Location of head
officeThe details of
the business

Minato-ku,

Manufactureand sales ofTokyo

FV Japan Co.,

Toshima-ku,

Ltd.

Tokyo

Coca-Cola
Bottlers Japan
Vending Inc.
Coca-Cola
Bottlers Japan
Business
Services Inc.

beverage andfoodSales ofbeverages andPrevious fiscal
year(As of December
31, 2020)

Current fiscal year
(As of December
31, 2021)

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%-

foods
Vending

Minato-ku,
Tokyomachineoperation

Minato-ku,
Tokyo

In-officebusiness(Note )
Manufacture
Healthcare &Skincarebusiness(Discontinued

Q’sai CO., LTD.

and sales ofhealth foods

Chuo-ku,
Fukuokaandcosmetics-

operations)relatedproducts(NOTE) 1. Percentage of voting rights includes indirect holdings through subsidiary.
2. Transfer of all shares in Q’sai CO., LTD., it was excluded from the scope of consolidation on February 1 2021.
For gain or loss on loss of control of a subsidiary, see Note 9, "Disposal groups classified as held for sale anddiscontinued operations."
33. Investments accounted for using the equity method
The primary associates of the Group are as follows: The principal business locations are the same as those of the Company.
There is no individually significant associate.
Percentage of voting rightOperatingsegment
Beveragebusiness

Name of associate

Location of head
officeThe details of
the business

Previous fiscal
year(As of December
31, 2020)

Current fiscal year
(As of December
31, 2021)

Apex Nishi-nihonCo., Ltd.

Fukushima-ku,
Osaka

Beverage sale

34.0%

-

44.0%

44.0%

Resources Inc.

Vending
machine-Takamatsushi, Kagawa

relatedbusiness(NOTE) 1. Percentage of voting rights includes indirect holdings through subsidiary.
2. As the transfer of all shares of Apex Nishi-Nihon Corporation was completed, the company was excluded from the scope of
application of the equity method.
122

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

34. Commitment
Purchase commitments
Commitments related to acquisition of property, plant and equipment and intangible asset after the reporting date areas follows:(Millions of yen)Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

Property, plant and equipment
Intangible assets

5,645
97

8,342
－

Total

5,742

8,342

Purchase commitments excluding the above amounts were 3,540 million yen and 5,600 million yen for the previous
fiscal year and the current fiscal year, respectively. Primarily due to the contract of outstanding obligations related to thegas purchasing contract.
35. Earnings per share
The computation of basic earnings (loss) per share attributable to owners of the parent is based on net profit for the year
attributable to owners of the parent and the weighted-average number of shares of ordinary share outstanding.
Basis for calculation of basic earnings (loss) per share is as follows:
Previous fiscal year
Current fiscal year
(From January 1, 2020
(From January 1, 2021
to December 31, 2020)
to December 31, 2021)
Loss from continuing operations attributable to owners ofparent (Millions of yen)
Loss from discontinued operations attributable to ownersof parent (Millions of yen)
Weighted-average shares of ordinary share outstanding (inthousands)
Basic earnings(loss) per share (Yen)Continued operations(7,130)(15,008)

2,415

12,505

179,350

179,346(39.76)(83.68)Discontinued operations
13.47
69.72
Basic loss per share (Yen)(26.29)(13.96)(NOTE) 1. Diluted earnings (loss) per share for the previous consolidated fiscal year is not shown since there are no residual shares. In
the cumulative the current consolidated fiscal year, 415 thousand shares of stock-based compensation were accounted for
antidilutive, "Diluted earnings per share" is not shown.
2. For more information on the Loss from discontinued operations attributable to owners of parent, see Note 9, " Disposalgroups classified as held for sale and discontinued operations.

123

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

36. Related party transactions
Transaction amounts and amounts outstanding with the related parties were as follows: Transactions with subsidiaries are
not disclosed as they have been eliminated in consolidated financial statements.
For the year ended December 31, 2020
(Millions of yen)
Relationship withaffiliated companies

Name

Transaction

The amount of thetransaction

Amount outstanding

Income from
Subsidiary of othersubsidiaries andCoca-Cola (Japan)
Company, Limited

associates
An officer of theparent company
holds a majority ofthe voting rights inanother company, etc.

MICHINOKU
COCA-COLABOTTLING CO.,LTD.

rebates of sales
promotion

132,021

16,351

306,759

10,273

Sale of soft drinks

2,480

260

Purchase of softdrinks

168

6

Purchase ofconcentrate

For the year ended December 31, 2021
(Millions of yen)
Relationship withaffiliated companies

Name

Transaction

The amount of thetransaction

Amount outstanding

Income from
Subsidiary of othersubsidiaries andCoca-Cola (Japan)
Company, Limited

associates

rebates of sales
promotion
Purchase ofconcentrate

130,653

25,374

313,590

11,280

An officer of theSale of soft drinks
3,109
278
MICHINOKU
parent company
COCA-COLA
holds a majority of
Purchase of soft
BOTTLING CO.,70
9the voting rights inLTD.
drinksanother company, etc.
Note 1. The transaction amount does not include consumption taxes, but the amount outstanding includes consumption taxes.
2. Transactions with The Coca-Cola Company's subsidiary, Coca-Cola (Japan) Company, Limited are conducted based on thecontract concluded with The Coca-Cola Company and Coca-Cola (Japan) Company, Limited concerning the manufacture, saleof the Coca-Cola etc. and use of the Coca-Cola trademark.
3. Transactions with Michinoku Coca-Cola Bottling Co., Ltd. are determined in the same way as transactions with other parties
with no association with our company and under the general trading terms and conditions that take into consideration the market
prices, etc.
Compensation for major key management personnel is as follows:
Previous fiscal year
(From January 1, 2020
to December 31, 2020

(Millions of yen)
Current fiscal year
(From January 1, 2021
to December 31, 2021

Remuneration

475

489

Stock-based compensation
Bonus
Compensation upon retirement

132
－

234
120

－

Other

81

21
74

688

937

Total
37. Events after the reporting period
Not applicable124This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(2) Other information
Quarterly Information etc. for the current consolidated fiscal year
1st quarter(Year-to-date)
Revenue

2nd quarter3rd quarter

Current fiscal year

(Yen)

168,399369,309589,531785,837(Yen)(15,414)(18,475)(20,395)(21,683)

Net loss in attributable to owners of theparent for the quarter or year

(Yen)

1,316

(354)

(1,535)(2,503)

Loss per share

(Yen)

7.30

(1.98)(8.56)(13.96)Net loss before income taxes andminority interests for the quarter or year

1st quarter(Quarter-to-date)
Earnings (loss) per share

(Yen)

7.34

2nd quarter(9.31)

3rd quarter(6.58)(Note): Net Income (Loss) Attributable to Owners of Parent is a total of continuing operation and discontinued operation results.

125

4th quarter(5.40)

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

2. Financial Statements (Non-consolidated)(1) Financial statements (Non-consolidated)① Balance sheet(Millions of yen)Previous fiscal year
(As of December 31, 2020)
AssetsCurrent assets
Cash and deposits
Prepaid expense
Short-term loans to affiliates
Account receivables - other
Other
Total current assets
Fixed assets
Property, plant and equipment
Buildings
Structures
Machinery, equipment and vehicles
Land
Total property, plant and equipment
Intangibles assets
Leasehold
SoftwareTotal intangibles asset
Investments and other asset
Investment securities of subsidiaries andassociates
Deferred tax assets
Other
Total investments and other assets
Total fixed assets
Total assets

126

Current fiscal year
(As of December 31, 2021)

7,603
45
132,194112
1,640
141,595

7,187
39
128,454
82
2,146
137,908

14,8871,080
18
50,141
66,126

13,031924
13
48,21662,185

27
2
29

27
1
28

378,471

342,561540
544
379,556445,710587,306

184
544
343,289405,502543,410

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(Millions of yen)Previous fiscal year
(As of December 31, 2020)
Liabilities
Current liabilities
Short-term loans payable
Current portion of bonds
Accounts payable
Accrued expenses
Deposits
Bonus provision
Provision of directors' bonuses
Other
Total current liabilities
Non-current liabilities
Bonds
Asset retirement obligations
Performance-linked compensation provision
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Legal capital reserve
Other capital surplus
Total capital surplus
Retained earnings
Legal reserve
Other retained earnings
Excess tax depreciation reserve
General reserve
Retained earnings brought forward
Total retained earnings
Treasury Stock
Total shareholders' equity
Total net assets
Total liabilities and net assets

127

Current fiscal year
(As of December 31, 2021)

50,000－434
512,660－－624
63,723－30,000
333
4
9,722
4
120
91
40,274

180,000
1,025
94
72
181,191
244,914150,000
1,039
197
87
151,324
191,598

15,232

15,232

108,167
158,783
266,950

108,167
158,783
266,950

3,317

3,317

677
110,388
31,482
145,864(85,654)342,391
342,391
587,306

676
110,388
40,911
155,292(85,661)
351,812351,812543,410

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

② Statements of profit or loss
(Millions of yen)Previous fiscal year
(From January 1, 2020
to December 31, 2020
Operating revenue
Operating expenses
Operating profit
Non-operating income
Interest and dividends income
Other
Total non-operating income
Non-operating expenses
Interest expense
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Gain on sales of stocks of subsidiaries and affiliates
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Impairment losses
Loss on disposal of fixed assets
Total extraordinary losses
Income before income tax
Income taxes
Income tax adjustments
Total income taxes
Net profit

128

Current fiscal year
(From January 1, 2021
to December 31, 2021

19,202
4,372
14,831

5,797
4,257
1,540

84
12
96

183
19
202

548
33
581
14,345

472
69
541
1,201

2,959
－
2,959

1,359
17,57918,938

507
58
237
802
16,502
1,055
(295)
760
15,742

33
298
3
333
19,805
1,054
356
1,410
18,395

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

③ Statements of changes in equity
Previous fiscal year (From January 1, 2020 to December 31, 2020)(Millions of yen)
Shareholders' equity
Capital surplus

Retained earnings

Capital stock
Legal capital reserve Other capital surplus Total capital surplus
Balance at January 1, 2020

Legal reserve

Other retained
earnings

15,232

108,167

158,784

266,951

3,317

131,289

Dividend of surplus

－

－

－

－

－

(4,484)

Net profit

－

－

－

－

－

15,742

Purchase of treasury stock

－

－

－

－

－

－

Disposal of treasury stock

－

－

(1)

(1)

－

－

Net changes in items otherthan shareholders' equity

－

－

－

－

－

－

Total changes during the year

－

－

(1)

(1)

－

11,258

Balance at December 31, 2020

15,232

108,167

158,783

266,950

3,317

142,547

Changes during the year

Shareholders' equity
Retained earnings
Total retained
earnings
Balance at January 1, 2020

Total shareholders’equityTreasury stock

Total net assets

134,606(85,649)

331,139

331,139

Dividend of surplus(4,484)－(4,484)(4,484)

Net profit

15,742－

15,742

15,742

Purchase of treasury stock

－

(8)

(8)

(8)

Disposal of treasury stock

－

3

2

2

Net changes in items otherthan shareholders' equity

－

－

－

－

Total changes during the year

11,258(5)

11,252

11,252

Balance at December 31, 2020

145,864(85,654)342,391

342,391

Changes during the year

129

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Current fiscal year (From January 1, 2021 to December 31, 2021)(Millions of yen)
Shareholders' equity
Capital surplus

Retained earnings

Capital stock
Legal capital reserve Other capital surplus Total capital surplus
Balance at January 1, 2021

Legal reserve

Other retained
earnings

15,232

108,167

158,783

266,950

3,317

142,547

Dividend of surplus

－

－

－

－

－

(8,967)

Net profit

－

－

－

－

－

18,395Purchase of treasury stock

－

－

－

－

－

－

Disposal of treasury stock

－

－

(0)

(0)

－

－

Net changes in items otherthan shareholders' equity

－

－

－

－

－

－

Total changes during the year

－

－

(0)

(0)

－

9,428

Balance at December 31, 2021

15,232

108,167

158,783

266,950

3,317

151,975

Changes during the year

Shareholders' equity
Retained earnings
Total retained
earnings
Balance at January 1, 2021

Total shareholders’equityTreasury Shares

Total net assets

145,864(85,654)342,391

342,391

Dividend of surplus(8,967)－(8,967)(8,967)

Net profit

18,395－

18,395

18,395Purchase of treasury stock

－

(8)

(8)

(8)

Disposal of treasury stock

－

1

0

0

Net changes in items otherthan shareholders' equity

－

－

－

－

Total changes during the year

9,428

(7)

9,421

9,421

Balance at December 31, 2021

155,292(85,661)

351,812351,812

Changes during the year130This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Supplemental notes of the statement of changes in equity(NOTE) Breakdown of other retained earnings
Previous fiscal year (From January 1, 2020 to December 31, 2020)
Other retained earnings
Advanced
Other voluntary
depreciation
reserve fundreserve fund(Millions of(Millions of
yen)
yen)
Balance at January 1

Deferred
retainedearnings(Millions ofyen)

Total otherearnings(Millions of
yen)

761

110,388

20,140131,289

Dividend of surplus－－(4,484)(4,484)

Net income－－

15,742

15,742

Reversal of reserve funds

(84)

－

84

－

Purchase of treasury stock

－

－

－

－

Disposal of treasury stock

－

－

－

－

Changes in items other thanshareholders' equity, net

－

－

－

－

Total changes during the year

(84)

－

11,343

11,258

Balance at December 31

677

110,388

31,482

142,547

Changes during the year

Current fiscal year (From January 1, 2021 to December 31, 2021)
Other retained earnings
Advanced
Other voluntary
depreciation
reserve fundreserve fund(Millions of(Millions of
yen)
yen)
Balance at January 1

Deferred
retainedearnings(Millions ofyen)

Total otherearnings(Millions of
yen)

677

110,388

31,482

142,547

Dividend of surplus－－(8,967)(8,967)

Net income－－

18,395

18,395

Disposal of treasury stock

(1)

－

1

－

Reversal of reserve funds

－

－

－

－

Purchase of treasury stock

－

－

－

－

Changes in items other thanshareholders' equity, net

－

－

－

－

Total changes during the year

(1)

－

9,429

9,428

676

110,388

40,911

151,975

Changes during the year

Balance at December 31

131This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

【Notes】(Significant accounting policies)
1. Accounting policy for measuring securities(1) Bonds held to maturity
These are measured at amortized cost (straight-line method).
(2) Investment securities of subsidiaries and associates
These are measured at cost determined mainly by the moving-average method(3) Other securities
With market value:
These are measured by market value method based on market prices as of the end of the fiscal year (valuationdifferences are all included in net assets, and the sold cost of securities is determined by the moving-average method).
Without market value:
These are measured at cost determined principally by the moving-average method.
2. Accounting policy for depreciation of assets(1) Property, plant and equipment
Depreciation is calculated by the straight-line method. The main useful life is as follows:
Buildings
2 – 50 years(2) Intangibles assets
Amortization is calculated by the straight-line method.
3. Accounting policy for provisions(1) Bonus provision
Bonus provision is recognized at the estimated amount to be paid as of the fiscal year, in order to prepare for thepayment of bonuses to employees.
(2) Provision of directors' bonuses
Provision of directors' bonuses is recognized the estimated amount to be paid as of the fiscal year, in order to prepare
for the payment of bonuses to directors and corporate auditors.
(3) Performance-linked compensation provision
Performance-linked compensation provision is recognized the estimate amount to be paid as of the fiscal year, in orderto prepare for the payment of shares and cash to executive directors and executive officers.
4. Other significant information for preparation of financial statements
Accounting policy for consumption taxes
Consumption taxes are subject to the net of tax method.

132

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(Notes to Balance Sheet)※1 Amounts related to subsidiaries and associates included in them are as follows:
Previous fiscal year
(As of December 31, 2020)
Short-term monetary receivables
Short-term monetary payables

112 million yen
12,766

Current fiscal year
(As of December 31, 2021)
82 million yen
9,757

2 Contract for overdraft
The Company has entered into the overdraft contracts with six banks to efficiently secure working capital. The unused
outstanding of the overdraft contracts as of the end of the previous fiscal year and the current fiscal year is as follows:
Previous fiscal year
(As of December 31, 2020)
Maximum overdraft amount

255,000 million yen

Used outstanding of loans
Net amountCurrent fiscal year
(As of December 31, 2021)

50,000255,000 million yen－

205,000

255,000(Notes to statement of profit or loss)※1 Transactions with affiliated companies
Previous fiscal year
(From January 1, 2020
to December 31, 2020)
Sales revenue and operating revenue

19,202 million yen

Transactions excluding operating transactions

86

Current fiscal year
(From January 1, 2021
to December 31, 2021)
5,797 million yen
182※2Major items and amounts of selling, general and administrative expenses and operating expenses are as follows:
Previous fiscal year
(From January 1, 2020
to December 31, 2020)
Depreciation.

1,701 million yen

Current fiscal year
(From January 1, 2021
to December 31, 2021)
1,578 million yen

Taxes and dues
Rents expenses

929
515

797
682

Consignment expenses of business activities
Directors’ remuneration

93
556
－

68
572

30

103

13

13

3
38

3
2

Provision for directors' bonus provision
Provision for performance-linked
compensation provision
Advertising expenses
Retirement benefit expenses
Bonuses and provision for bonuses provision120※3 The breakdown of gain on sales of non-current assets is as follows:
Previous fiscal year
(From January 1, 2020
to December 31, 2020)
Buildings

2,664 million yen

Current fiscal year
(From January 1, 2021
to December 31, 2021)
1,325 million yen

Structures

32

33

Land

263

1

133

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

※4 The breakdown of loss on sales of non-current assets is as follows:
Previous fiscal year
(From January 1, 2020
to December 31, 2020)

Current fiscal year
(From January 1, 2021
to December 31, 2021)

Buildings

40 million yen

26 million yen

Structures

5

7

461

0

Land

※5 Impairment losses
The Company decides the grouping of assets for business by business units on managerial accounting purpose whose
profit or loss is managed on an ongoing basis. In addition, for rental assets and idle assets, the Company identifies eachindividual property as the smallest unit for grouping and assesses the indication of impairment.
For the buildings, structures and land of the applicable base of the idle assets whose land value has declined, the carrying
amount has been reduced to its recoverable amount, and the amount of such reduction is recorded as impairment losses.
The recoverable amount of idle asset is calculated based on real estate appraisal value.
Previous fiscal year (From January 1, 2020 to December 31, 2020)
RegionUse

Number of sites

Kinki

Idle asset

2

KyushuIdle asset

Type
Buildings

4

Impairment losses
0 million yen

Land

1

Buildings
Land

17
41

Current fiscal year (From January 1, 2021 to December 31, 2021)
RegionUse

Number of sites

KyushuIdle asset

1

Type
Buildings
Structures

Impairment losses
262
36(Securities)
Investment securities of subsidiaries and associates (the amount of investment securities of subsidiaries in the balance sheet
for the previous fiscal year and the current fiscal year were 378,471 million yen and 342,561 million yen, respectively) are notnoted, as they do not have quoted market prices and it is deemed extremely difficult to determine their fair value.

134

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

(Tax effect accounting)
1. The breakdown of major causes of deferred tax assets and deferred tax liabilities
Previous fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

2,096 million yen
232

1,775 million yen
323－

Deferred tax assets
Excess of depreciation
Impairment losses
Securities of subsidiaries
Other

187
643

Subtotal deferred tax assets

3,157

2,827

Valuation allowance

(355)

(471)

Total deferred tax assets
Deferred tax liabilities

2,802

2,356

(926)
(1,260)(919)(1,182)

(76)

(70)

(2,261)(2,171)

540

184

Advanced depreciation reserve fundDifference on revaluation of land
Other
Total deferred tax liabilities
Deferred tax assets (liabilities), net

728

2. Differences between the statutory tax rate and the applicable tax rate after tax effectPrevious fiscal year
(As of December 31, 2020)

Current fiscal year
(As of December 31, 2021)

Statutory tax rate

30.6%

30.6%

Adjustments:
Dividends income(25.1)(24.6)

Permanent differences such as entertainment
expense0.4

0.5

Valuation allowance
Other

(1.3)
0.0

0.6
0.0

4.6

7.1

Applicable tax rate after tax effect(Significant events after the reporting period)
Not applicable.

135

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

④ Annexed detailed schedules
Annexed detailed schedule of property, plant and equipment(Millions of yen)
Balance at the
beginning of
the year

Increaseduring theyear

Buildings

69,242－

Structures

11,892－35－

50,141－

131,309－

Leasehold

27－

Software5
32

Classification

Property, plantand equipment

Type of asset

Machinery, equipment,
vehiclesLand
Total
Intangible
assets

Total

Decreaseduring the
year
2,051

Accumulated
Depreciation
depreciation,
andBalance at end amortizationamortizationof the year andduring theimpairment
year
losses

1,473

67,191

54,160115

11,626

10,701

－

5

35

22

1,924

－

48,216－

1,593

127,068

64,883

－

－

27

－

－

－

1

5

4

－

－

1

32

4

(262)
266
(36)

4,241
(298)

(NOTE) 1. Breakdown of main decrease is as follows:
Impact of sales kagoshima-chuo officeLand
Impact of sales minato office

1,062 million yen
312 million yen

Impact of sales nishi-nagasaki office

176 million yen

Impact of sales mihara office

119 million yen

2.The figures in the ( ) in “Decrease during the year” represent the amount of impairment loss recorded.
3. The balance at the beginning of the fiscal year and the balance at the end of the fiscal year are stated based on theacquisition price.

Annexed detailed schedule of provisions
Account title

Balance at the beginning
Increase during the yearof the year

Decrease during theyear(Millions of yen)
Balance at the end of theyear

Allowance for bonuses

－

4

－

4

Allowance for officers’ bonuses

－

120

－

120

Officer’s compensation

94

197

94

197

(2) Components of major assets and liabilities
This information is omitted because the consolidated financial statements are prepared.
(3) Other information
Not applicable.

136

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Ⅵ. Overview of operational procedures for shares
Accounting period

From January 1 to December 31

Ordinary General
Meeting of Shareholders

March

Record date

December 31

Record date of dividend

June 30
December 31

Number of sharesconstituting one unit

100 shares

Purchase and sales ofshares less than one unit
(Special Account)Handling place

Administrator of
Shareholders’ Register

Sumitomo Mitsui Trust Bank, Limited
Stock Transfer Agency business Planning Department
4-5-33 Kitahama, Chuo-ku, Osaka-shi(Special Account)
Sumitomo Mitsui Trust Bank, Limited
1-4-1 Marunouchi, Chiyoda-ku, Tokyo

Forward office――――――
Calculate the amount of fee per unit based on the following formula and make this amountproportional to the number of odd-lot shares purchased or purchased.

Purchase or purchaseincrease fee(Calculation formula) Amount of total purchased price or price per purchase multiplied by one unit
share number
Amount less than 1 million yen
1.150％
Amount in excess of 1 million yen and 5 million yen or less
0.900％
Amount of 5 million yen or more and 10 million yen or less
Amount more than 10 million yen and 30 million yen or less0.700％
0.575％

Amount more than 30 million yen and 50 million yen or less
0.375％（If fractional numbers less than the circle are generated, truncation）
However, if the calculated amount per unit is less than 2,500 yen, it shall be 2,500 yen.
New ticket delivery
fee

Free
Electronic public notice on the Company’s website (https://www.ccbj-holdings.com/).

Publication notice
publication method

However, if it is not possible to make public notices by electronic public notice due to an
accident or other unavoidable circumstances, public notices shall be listed in Nihon
Keizai Shimbun.

Benefits to shareholders

Not applicable(Note) Rights for shares of less than one unit
Pursuant to the Company’s articles of incorporation, shareholders holding shares of less than one unit of shares have no rights other thanthose listed below:- Rights listed in Article 189, Paragraph 2 of the Companies Act.
- The right to make demands pursuant to Article 166, Paragraph 1 of the Companies Act- The right to receive allotment of shares for subscription or stock acquisition rights for subscription according to the number of shares
held by the shareholder- The right to demand cash-out of shares of less than one unit of shares

137

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Ⅶ. Reference information about the Company
1. Information about parent company of reportable segment
The Company has no parent company, etc. stipulated in Article 24-7, Paragraph 1 of the Financial Instruments and Exchange Act.

2. Other reference information
The following documents have been submitted between the start date of this fiscal year and the date of submission of the securities
report.
(1) Securities report and its attached documents and confirmation
Business year (63rd term) (January 1, 2020 to December 31, 2020) Submitted to Kanto Finance Bureau March 26, 2021
(2) Internal control report
Submitted to Kanto Finance Bureau March 26, 2021
(3) Quarterly report and confirmation(First quarter of the 64th term) (January 1, 2021 to March 31, 2021) Submitted to Kanto Finance Bureau Chief May 14, 2021
(Second quarter of the 64th term) (April 1, 2021 to June 30, 2021) Submitted to Kanto Finance Bureau Chief August 12, 2021
(Third quarter of the 64th term) (July 1, 2021 to September 30, 2021) Submitted to Kanto Finance Bureau Chief November
12, 2021(4) Extraordinary report
Filed with the Director-General of the Kanto Local Finance Bureau on March 31, 2021
Extraordinary Report pursuant to Article 19, Paragraph 2, Item 9-2 (results of voting in the General Meeting of Shareholders)of the Cabinet Office Ordinance on Disclosure of Corporate Affairs, etc.
(5) Amended Shelf Registration Statement
Submitted to Kanto Finance Bureau Chief June 4, 2021

138

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-General of the Kanto Local
Finance Bureau via Electronic Disclosure for Investors` NETwork (“EDINET”) pursuant to the Financial Instruments and Exchange Act of Japan. In theevent of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken Hokokusyo shall prevail.

Part Ⅱ. Information about company which provides guarantee to reportable segment
Not applicable139