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.

Annual Securities Report(Report Pursuant to Article 24, Paragraph 1 of the Financial
Instruments and Exchange Act)
Fiscal Year
From January 1, 2019
(62nd Fiscal Term)to December 31, 2019

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

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.

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 .................................................................................................................................................................................. 15
3. Management's analysis of financial condition, results of operations and cash flows ................................................................... 18
4. Important agreements for business .............................................................................................................................................. 23
5. Research and development activities ........................................................................................................................................... 23
III. Information about facilities ........................................................................................................................................................... 24
1. Overview of capital expenditures ................................................................................................................................................ 24
2. Major facilities ............................................................................................................................................................................ 24
3. Planned additions, retirements of facilities .................................................................................................................................. 25
IV. Information about reportable segment ........................................................................................................................................... 26
1. Information about shares ............................................................................................................................................................. 26(1) Total number of shares ........................................................................................................................................................... 26(2) Share acquisition rights .......................................................................................................................................................... 26(3) Exercises of moving strike convertible bonds ........................................................................................................................ 27(4) Changes in number of issued shares, stated capital ................................................................................................................ 27(5) Shareholding by shareholder category ................................................................................................................................... 27(6) Major shareholders................................................................................................................................................................. 28(7) Voting rights ........................................................................................................................................................................... 29
2. Acquisition of treasury stock ....................................................................................................................................................... 29(1) Acquisitions by resolution of shareholders’ meeting .............................................................................................................. 29(2) Acquisitions by resolution of board of directors’ meeting...................................................................................................... 29(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...................................................................................................................................................... 39(3) Audit Status............................................................................................................................................................................ 45(4) Details and procedures on compensation of Directors and Executive Officers ...................................................................... 47(5) The Company's shareholding status ....................................................................................................................................... 52
V. Financial information ...................................................................................................................................................................... 59
1. Consolidated financial statements ............................................................................................................................................... 60(1) Consolidated financial statements .......................................................................................................................................... 60(2) Other information ................................................................................................................................................................ 127

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.
2. Financial Statements (Non-consolidated) .................................................................................................................................. 128(1) Financial statements (Non-consolidated) ............................................................................................................................. 128(2) Components of major assets and liabilities .......................................................................................................................... 139(3) Other information ................................................................................................................................................................ 139
Ⅵ. Overview of operational procedures for shares ........................................................................................................................... 140
Ⅶ. Reference information about the Company ................................................................................................................................ 142
1. Information about parent company of reportable segment ........................................................................................................ 142
2. Other reference information ...................................................................................................................................................... 142
Part Ⅱ. Information about company which provides guarantee to reportable segment .......................................................................... 143

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.

[Cover Page]

Securities Report[Underlying article]

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

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

March 27, 2020

[Fiscal year]

62nd fiscal term (from January 1, 2019 to December 31, 2019)[Company name]Coca-Cola Bottlers Japan Holdings Inc.

[Name and position of representative]

Calin Dragan, Representative Director & President

Exchange Act[Address of head office]9-7-1 Akasaka, Minato-ku, Tokyo(From March 26, 2020, the location of the head office has been changed to the abovefrom 9-66 Hakozaki, Higashi-ku, Fukuoka City.)[Telephone number](03)-6896-1707[Name of administrative contact]

Cordula Thomas, 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]

Cordula Thomas, Head of Controllers Senior Group Division, Finance[Location provided for viewing]

Tokyo Stock Exchange, Inc.
（2-1 Nihonbashi Kabutocho, Chuo Ward, Tokyo）
Fukuoka Stock Exchange（2-14-2 Tenjin, Chuo Ward, Fukuoka City）

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 the event 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

December 2017

December 2018

December 2019

Revenue(Millions ofyen)

837,069

927,307914,783

Profit before income tax(Millions ofyen)

37,914

14,767(55,419)

Net profit attributable to owners of the(Millions of

21,967

10,117(57,952)

30,1493,152(52,164)

parentyen)

Comprehensive income attributable toowners of the parent(Millions ofyen)

Equity attributable to owners of theparent(Millions ofyen)

654,611

580,448505,999

Total assets(Millions ofyen)

929,304

877,472

952,444(Yen)

3,204.90

3,163.63

2,821.27

Basic earnings per share(Yen)

125.5352.68(322.22)

Diluted earnings per share

(Yen)

-

-

－

Ratio of equity attributable to ownersof the parent to total assets

(%)

70.4

66.2

53.1

Ratio of return on equity

(%)

4.6

1.6

(10.7)(Times)

32.8

62.4

(8.7)

Cash flows from operating activities(Millions ofyen)

73,014

51,244

42,629Cash flows from investing activities(Millions ofyen)(14,299)(48,628)(68,308)(26,717)(55,835)

73,994

118,742

65,510113,825

17,197

17,10016,959[4,403][3,957][3,578]Equity per share attributable toowners of the parent

Price-earnings ratio

Cash flows from financing activities
Cash and cash equivalents at the endof the year

(Millions ofyen)(Millions ofyen)

Number of the employees[Average number of temporary(People)workers](NOTE) 1. Revenue does not include consumption tax.

2. Diluted earnings per share is not disclosed because there are no potential ordinary shares.
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.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
Japanese GAAP
Fiscal term
58th
59th
60th
61st
Fiscal year-end
Sales revenue

December 2015 December 2016 December 2017 December 2018
(Millions of

440,476

460,455

872,623

968,439

13,723

20,60239,86026,011

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

9,970

5,245

25,244

10,948(Millions ofyen)

11,217

5,022

31,976440

260,878

261,173

627,486

550,775

378,105

377,468

883,919

833,915

Ordinary income

Comprehensive income
Net assets
Total assets

yen)(Millions ofyen)(Millions ofyen)(Millions ofyen)

Net assets per share(Yen)

2,386.81

2,389.28

3,070.01

2,999.40

Net profit per share

(Yen)

91.35

48.05

144.26

57.01

Diluted earnings per share

(Yen)

-

-

-

-

Ratio of equity to asset

(%)

68.9

69.1

70.9

66.0

Ratio of return on equity

(%)

3.9

2.0

5.7

1.9

(Times)

26.9

71.7

28.5

57.6

40,422

34,38872,45050,768(24,994)(19,921)(41,091)(48,621)

Price-earnings ratio
Cash flows from operating
activities
Cash flows from investing
activities(Millions ofyen)(Millions ofyen)Cash flows from financing
activities(Millions ofyen)

22,416(7,546)(26,160)(55,366)

Cash and cash equivalents are
the beginning of the year

(Millions ofyen)

79,82886,727

118,742

65,510

8,837

8,616

17,197

17,100[2,613][2,499][4,403][3,957]

Number of the employees[Average number of temporary
workers](People)(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 since the 60th fiscal year.
Previously, the figures of less than one million yen had been rounded down 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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
(2) Management indicators of the Company
Fiscal term
58th
59th
60th
61st
62nd
Fiscal year-end

December 2015 December 2016 December 2017 December 2018 December 2019

Sales revenue and(Millions ofoperating revenue

yen)Ordinary income(Millions ofyen)

370,510385,889

93,705

10,37526,517

10,692

14,647

6,087

5,224

20,273

Net profit(Millions of
yen)

6,981

12,034

4,991

4,395

20,702

Capital stock(Millions ofyen)

15,231

15,231

15,232

15,232

15,232

Total number of(Thousands ofissued sharesshares)111,125

111,125

206,269

206,269

206,269

246,599

252,750

405,242

332,507

331,139(Millions ofyen)

357,778369,792475,220

478,484

549,683(Yen)

2,259.50

2,315.90

1,984.02

1,812.27

1,846.32

41.00

46.00

44.00

50.00

50.00

(20.00)(22.00)(22.00)(25.00)(25.00)

(Yen)

63.96

110.26

28.52

22.89

115.11

(Yen)

-

-

-

-

-

(%)

68.9

68.3

85.3

69.5

60.2

Ratio of return on
equity

(%)

2.8

4.8

1.2

1.2

6.2

Price-earnings ratio(Times)

38.4

31.2

144.3

143.5

24.2

Dividend payout ratio

(%)

64.1

41.7

154.3

218.4

43.4

1,620

1,635

729

-

-

[120]

[119]

[41]

[-]

[-]

150.4

212.6

255.6

208.7

181.9

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

Number of theemployees[Average number of(People)temporary workers]
Total Shareholder
Return[Comparative index:(%)

TOPIX Net Total
Return Index](%)[112.1][112.4][137.4][115.5][136.4]Highest stock price

(Yen)

2,647

3,485

4,385

4,815

3,490

Lowest stock price

(Yen)

1,603

2,177

3,065

2,793

2,157

(NOTE)
1.
2.
3.
4.

Sales revenue and operating revenue do not include consumption tax.
Diluted earnings per share is not disclosed because there are no potential ordinary shares.
The Company was transferred to a holding company through a company split with New CCW Establishment Preparation
Company Co., Ltd. on April 1, 2017. As a result, the account title has changed to “Sales revenue and operating revenue”
from “Net sales” since the 60th fiscal year.
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.
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
5. The figures of less than one million yen have been rounded off to the nearest million yen since the 60th fiscal year. Previously,
the figures of less than one million yen had been rounded down to the nearest million yen.
6. 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
7. The highest and lowest stock prices are from Tokyo Stock Exchange 1st section.
8. 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 fiscal year under review. 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 the event 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.

Jan. 2018

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 the event 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, 11 subsidiaries, two affiliates, and one non-equity method affiliate with
Beverage business as its primary operations. In addition, the Coca-Cola Company is an affiliated company. The following diagramsets out the positioning and business of each company in the Coca-Cola Bottlers Japan Holdings Group’s (the “Group”) principal
business activities. Business categories correspond to segment categories.
(1) Beverage business(Production 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., Kadiac Co., Ltd., Coca-Cola Customer Marketing Co., Ltd, and Apex Nishi-Nihon Corporation.
b. Production 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., and Resources Co., Ltd.
(Real estate and insurance agency)
It is engaged by Coca-Cola Bottlers Japan Benefit Inc.
(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.
(2) Healthcare & Skincare business(Production and sale of health foods such as Aojiru that uses “Kale” as its ingredient and cosmetic related products)
They are engaged by Q’SAI CO., LTD., Q’sai Farm Shimane Co., Ltd., and Q’sai Analysis and Research Center Co., Ltd.
(Investment business)
It is engaged by CQ Ventures Co., Ltd.
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 the event 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 the event 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) 2,5

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

Higashi-ku,
Fukuoka-shi

80

Operation of vending
machines

100.0(100.0)――――FV Japan Co., Ltd.
(Note) 1, 6

Toshima-ku,
Tokyo

100

Sale of beverages
and foods

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

Higashi-ku,
Fukuoka-shi

80

On-siteadministration

100.0(100.0)――――Kadiac Co., Ltd.
(Note) 1

Sennan-shi,
Osaka

80

Sale of beverages

52.0(52.0)――――

Higashi-ku,
Fukuoka-shi

100Real estate business,insurance agent
business

100.0(100.0)――――

Minato-ku,
Tokyo

301

Sale of beverages

100.0(100.0)――――Chuo-ku,
Fukuoka-shi

Manufacturing andsale of health food and
350 products related tocosmetics.

100.0Interlocking directorate: yes

Masuda-shi,
Shimane10

Manufacture and saleof health food49.5
(49.5)[26.2]――――

Chuo-ku,
Fukuoka-shi

10

Manufacture and saleof health food

51.5
(51.5)――――

Chuo-ku,
Fukuoka-shi

50

Investment business

100.0(100.0)――――Coca-Cola Bottlers Japan
Benefit Inc.
(Note) 1
Coca-Cola Customer
Marketing Co., Ltd.
(Note) 1

Q’SAI CO., LTD.

Q’SAI Farm Shimane
Co., Ltd.
(Notes) 1,3,4
Q’SAI Analysis andResearch Center Co., Ltd.
(Note) 1
CQ Ventures Co., Ltd(Notes)
1.
2.
3.
4.

Principal businesses% of voting
rights interests

Relation

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.
The figures in brackets for the % of voting rights interests column indicates the % of voting interests of interests of persons
with close relationships, which is separate from the total voting interest.
Although the voting rights interests are 50% or less, it has been made a subsidiary because effective control is deemed toexist.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
5.

6.

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
874,646 million yen(JGAAP)(2) Recurring income
14,283 million yen(3) Net profit
6,216 million yen(4) Net assets
447,969 million yen(5) Total assets
607,656 million yen
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
96,902 million yen(JGAAP)(2) Recurring income
3,002 million yen(3) Net profit
1,455 million yen(4) Net assets
26,751 million yen(5) Total assets
44,055 million yen(2) Equity Method Affiliates
Address

Commonstock(millions ofyen)Apex Nishi-Nihon
Corporation(Note)

Fukushima-ku,
Osakashi64

Resources Co., Ltd.
(Note)

Takamatsu-shi,
Kagawa40

Name

Principal
businesses% of voting rights
interests

Relation

Sale ofbeverages

34.0(34.0)――――

Vending
machine-related
business

44.0(44.0)――――(Note)
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.
(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
Relation
Company（％）
dollars
Sales ofbeverages
18.89
1,760 (includingInterlocking directorate: yes(18.89)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-Generalof 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.

5. Employees(1) Consolidated Basis
As of December 31, 2019
Segment

Number of employees

Beverage business

16,465 (3,414)

Healthcare and Skincare business

494 (164)

Total

16,959 (3,578)(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
14,206 as of December 31, 2019. The relationship between management and labor unions is good.

11

This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-Generalof 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.

II. Business overview
1. Management policy, management environment and issues to be addressed(1) Fundamental management policy of the Company
In November 2019, the Group announced its new corporate philosophy, “Mission, Vision and Values”, which we refer toas "Paint it RED! Let’s repaint our future." Our corporate color is red, which expresses our passion and our strong will to
realize value creation.
As our Mission, 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 Group’s main targets for the fiscal year ending December 31, 2020 are a 1% year-on-year increase in revenue and18.0 billion yen in business profit, which is an indicator of the Group's business performance. However, achievement of thetarget may be impacted by macro-economic uncertaity as a result of the coronavirus (COVID-19) situation and the decision
to postpone the Olympic Games until 2021. CCBJH has various mitigation plans in place to deal with the rapidly evolving
situation, which we continue to adapt as necessary.
(3) Issues to be addressed by the Company
Our 2020 outlook reflects the guiding principle of our mid-term business plan that “business as usual is not an option”.The
Company is executing a transformation of our cost structure, including in the important vending channel and back-officeroutines, and increasing front-facing investments for growth in such areas as production capacity, space-to-sell and people
development, and we will continue to drive fundamental business change to return to a sustainable growth trajectory.
In the beverage business segment, in order to grow together as one “Coca-Cola System” in Japan, we will work closely
12This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-Generalof 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.
with the Coca-Cola (Japan) Company, Ltd. with aligned investment plans and more focused innovation on “fewer, bigger
bets” to drive revenue growth. And we will continue to transform the Commercial organization to realize best-in-classcustomer management, starting with a new organizational structure in January 2020 in order to strengthen customer
relationships and sales execution. Regarding the vending channel, we aim to deliver sustainable growth by expanding theoperational process reengineering we started in the Kinki region in 2019. In addition, together with The Coca-Cola Company
as a world-wide partner, we have been leveraging the excitement of the Tokyo 2020 Olympic and Paralympic games to beheld in Japan, with comprehensive marketing campaigns to activate the market. However, we are reviewing our Olympics
activation plans as a result of the decision to postpone the Olympics into 2021. Finally, the national launch of the Lemondou alcohol brand is performing well, and we will continue to expand our presence in this new beverage category.
Regarding our manufacturing capacity and efforts to optimize our logistics and distribution network, which are key
elements of our growth plan, we will commission four new production lines in 2020, including the new Hiroshima plant,
and we continue to build out the Project Shinsei logistics and distribution infrastructure, including optimization of sales
centers and construction of automated warehouses and a new mega distribution center in Saitama Prefecture. We will also
expand the transformation of our back-office operations into what we call centers of excellence and centers of scale,including outsourcing of transactional processing where feasible. Our initiatives include people strategies aligned with our
new Mission, Vision and Values as well as initiatives for ESG goals for creating shared value including World Without
Waste, our 2030 Package Vision for the Coca-Cola system in Japan.
In the health food and cosmetic business, we expect continued market growth, but with intensified competition as more
players seek to participate in this growing market segment. Under these circumstances, we will activate the existing main
products and recent new launches with effective marketing and advertising, including expanding to internet sales andfocusing on action to expand our customer base. Also, we will continue to make efforts in product development andmarketing capabilities to ensure a pipeline of relevant products that meet consumers’ changing needs.
（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 reffred 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 makeit possible to continually and persistently ensure and enhance the Company’s corporate value and, in turn, the common
interests of its shareholders. The Company believes that a decision on any proposed acquisition that would involve a changeof corporate control of the Company should ultimately be made based on the intent of its shareholders as a whole. Also, theCompany would not reject a large-scale acquisition of the shares in the Company if it would contribute to the corporate
value of the Company 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 valueof the 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 worldand embedding 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, andproactively working on building a workplace environment that can make each and every employee feel rewarded, motivatedand proud of being a member of the Coca-Cola family; and (iv) contributing to local communities and proactively dealing
with environmental 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 ina manner 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 andbusiness policies.
13This is an English translation of the original Annual Securities Report (“Yukashoken Hokokusho”) filed with the Director-Generalof 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 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-scaleacquisition of the shares in the Company by such Persons.
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 acompany 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 awhole, and the business environment surrounding the Company is projected to stay competitive as multiple players
compete in the market.
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,and drastically 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 oversight function, these external directors that serve as members of the Audit and Supervisory
Committee have each been granted with a voting right in the Board of Directors meetings, in addition to the right tostate their opinions in shareholders’ meetings on matters pertaining to the designation of board members and theirremuneration, among others. In order to separate the decision-making, business management and business executionfunctions, 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 theauthority 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
the Company 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 ofshareholders as well as make appropriate measures as needed under the scope permitted by laws and regulations andthe Articles of Incorporation.
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 trendof 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
improve the corporate value of the Company and the common interest of shareholders, and is consistent with theCompany’s basic policy.
In addition, the measure described in the previous b. (b) was introduced as a specific measure to ensure and improvethe corporate value of the Company and the common interest of shareholders as needed under the scope permitted bylaws and regulations and the Articles of Incorporation focusing on the intention of shareholders, and it is not intended
to undermine the shareholders’ common interests or preserve the positions of the Company officers.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.

2. Risk factors
Of the risks associated with “2. Business overview” and “5. Financial information” described in the Securities Report, main items
that may have significant impact on the judgment of investors are described. Recognizing the possibility that these risks may occur,
the Group will continue efforts to prevent them, and implement the required response should they occur.
Items related to the future and assumptions described in this section are those determined by the Group as of the date of submissionof the Securities Report.
(1) Risks associated with changes in owned assets
In the event of a decline in the value of assets owned by the Group such as land and securities, the Group's financial situation
and business performance may be affected. The Consolidated Financial Statement reports goodwill and intangible assets withindefinite durable lives. The Group conducts impairment tests annually and whenever there are events or changes in theenvironment suggesting potential impairment. If results hoped for cannot be achieved due to changes in the businessenvironment, the Group's financial situation and business performance may be affected.
(2) Risks associated with retirement benefit liabilities
In the event of a divergence between assumptions and performance due to deterioration in the management performance of
the Group's plan assets, or if assumptions such as discount rate that serve as a premise for the calculation of retirement benefit
liabilities are changed, the Group’s financial situation and business performance may be affected due to the increase inretirement benefit expenses or retirement benefit liabilities, etc.
(3) Risks associated with an increase in cost such as raw material cost
In the event of increase in the costs of main raw materials used by the Group to manufacture products (liquid concentrate,
beverage base, sugar, fruit juice, tea leaf, coffee beans), package/packing materials (aluminum can, PET bottle, resin, plastic,corrugated cardboard), energy (crude oil, electricity, etc.) or transportation due to changes in relations between The Coca-Cola
Company and its 100% subsidiary Coca-Cola (Japan) Company, Ltd, market prices, economic conditions, fuel costs, weather,natural disasters, exchange rate, etc. or various factors such as shortage of manpower for transportation, etc., the Group’s
financial situation and business performance may be affected.
(4) Risks associated with competition and changes in the market
In the beverage market, which is the Group’s core business, intense competition continues such as product development/pricecompetition among manufacturers, development of private label products by major retailers, and introduction of self-service
coffee by major convenience store operators. If the Group is unable to maintain its competitive advantage by continuously
strengthening its marketing and innovation abilities to maintain market share, the Group’s financial situation and businessperformance may be affected.
(5) Risks associated with changes in consumers' preferences, and environment and health concerns
If the Group fails to respond to changes in consumers' preference caused by changes in lifestyle, etc. or concerns over health,obesity, and environment as indicated by their interests in raw materials, nutrients, production site, avoidance of PET bottle
products due to growing global interest in container resource recycling issues etc., the Group’s financial situation and businessperformance may be affected.
(6) Risks associated with economic conditions
Adverse changes in the general economic conditions and economic recession in Japan may affect the Group’s financial
situation and business performance as the demand declines due to consumers' purchasing behavior, such as refraining frompurchasing the Group’s products, switching to low-prices products, etc.
(7) Risks associated with investment in infrastructure
The Group is investing in IT, supply chain, transportation and sales infrastructure. However, given that investments ininfrastructure usually are long-term in nature, investments made today may not generate expected returns as a result of futurechanges in the market. At the same time, the Group’s financial situation and business performance may be affected if
infrastructure investment requirements are not appropriately predicted.
(8) Risks associated with supply chain
To deliver products to customers, the Group acquires information necessary for the production process and builds effective
supply and distribution systems. However, circumstances such as natural disasters, manufacturing problems, transportation
problems, manpower problems, failure to provide stable services by main suppliers or distribution companies with businessconnections with the Group, etc. will hinder the Group’s manufacturing or sales activities, thereby affecting the Group’s
financial situation and business performance.
(9) Risks associated with changes in the retail environment
Major retailers including convenience stores, the main customers of the Group, focus on low prices as indicated by theirdevelopment of private brands and increasing expenditure on sales promotion. In addition, maintaining favorable relations withmain retail customers including discount stores and drugstores is indispensable to the Group’s success. It is also important to15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.
respond to the rapid expansion of online shopping. On the other hand, sales volume of vending machines which have been acore sales channel is declining with changes in the retail environment. If the Group fails to build a good relationship with main
retailers and respond to the rapidly changing retail environment, the Group’s financial situation and business performance may
be affected.
(10) Risks associated with water resource
Given that the Group’s core business is beverages, water is the main raw material of almost all the products offered by theGroup and is indispensable in the production process. Water is also necessary for the production of agricultural raw materials
which the Group’s business depends on and is important for the prosperity of the local community the Group serves. If theGroup faces water shortage or deterioration in water quality caused by a sudden increase in water demand, environmental
accidents at water sources, restrictions on water intake, etc., cost increase and issues with production capability may occur,
thereby affecting the Group’s financial situation and business performance.
(11) Risks associated with dependence on The Coca-Cola Company and its trademark and brand credibility
Our business is closely related to contracts with The Coca-Cola Company and its 100% subsidiary, Coca-Cola (Japan)
Company, Ltd. We receive support for business activities ranging from raw material procurement, manufacturing to sales
promotion activities. Thus, changes in this relationship could affect the Group's business, financial situation, businessperformance, and outlook.
Trademarks of beverage products offered by the Group including "Coca-Cola" belong to The Coca-Cola Company in the
U.S., with which the Group concluded the Bottler’s Agreement. As the Group's sales mostly come from the sale of beverages
that use trademarks owned by The Coca-Cola Company (hereinafter "Coca-Cola trademarks"), infringement of Coca-Cola
trademarks and damages to the brand credibility may affect the Group’s financial situation and business performance.
Maintaining the Coca-Cola trademarks, intellectual property and its brand credibility serves as a driving force indispensable
and important for attracting retailers and consumers, and for achieving the Group’s success.
(12) Risks associated with related laws and regulations
In the beverage business that is the Group’s core business, compliance with various laws and regulations regarding quality,
labelling, environment/recycling, etc., such as Food Sanitation Act, Food Labeling Act, Product Liability Act, Waste
Management and Public Cleansing Act, Law for Promotion of Recycling and Related Activities for the Treatment of Cyclical
Food Resources, and Act on the Promotion of Sorted Collection and Recycling of Containers and Packaging, is required.
Reinforcement of these related laws and regulations in the future could increase costs and reduce demand for the Group’s
products, and this may affect the Group’s financial situation and business performance.
(13) Risks associated with alcoholic beverages
The alcoholic beverages sold by the Group are subject to control by the Liquor Tax Law that stipulates tax on alcoholic
beverages, etc. in Japan. The Group has obtained the liquor sales license (wholesale) in accordance with the Liquor Tax Law.
Future business development is subject to control by the Liquor Tax Law, and selling prices/trends may be affected by changes
in the liquor tax rate. In addition, while moderate alcohol consumption is generally considered to have various favorable effects,
chronic alcohol use has also been pointed out to cause harm in various ways. If the gravity of these alcohol-related issues
increases further in society, there is a risk that sales activity may be subject to some sort of impact/restrictions, which may affectthe future prospect of the alcohol business, and the Group’s financial situation and business performance.
(14) Risks associated with the revision of taxation system
Various revisions to the taxation system, particularly increase in the consumption tax or tax on alcohol beverages, may affect
the Group’s financial situation and business performance due to the decline in the sales volume of beverages/alcoholic
beverages caused by the increase in selling prices and changes in consumers’ purchasing behavior.
(15) Risks associated with product safety and quality
The Group is striving to establish a quality assurance system based on related laws and ordinances and to deliver safe products
and accurate information to customers. However, if quality issues related to products including those caused by unforeseeable
factors arise, the Group’s financial situation and business performance may be affected due to product recalls or mass disposalof defective products. Moreover, should quality issues, etc. affecting the entire beverage/alcohol beverage industry and theentire society occur on a scale that cannot be addressed by the activities of the Group alone, the Group’s financial situation andbusiness performance may be affected.
(16) Risks associated with business integration
The Group may implement business acquisitions or business tie-ups, in which case the Group will thoroughly investigate theeconomic value or companies subject to the concerned acquisition or tie-up before reaching a decision. However, given thatbusiness integration involves uncertain factors, in the event the expected effects are not achieved, the Group’s financial situation
and business performance may be affected.
(17) Risks associated with lawsuits
16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.
In carrying out our business, the Group observes various laws and ordinances/regulations, etc. and carries out management
based on the compliance. However, in carrying out the business activities, lawsuits may be filed regardless of whether theGroup and employee violated laws and ordinances, etc. If a lawsuit is filed against the Group or the Group receives anunfavorable verdict, the Group’s financial situation and business performance may be affected.
(18) Risks associated with the business of affiliated companies
As for health food products and cosmetics-related products developed/manufactured/sold by the Group, products that meetmarket needs in terms of quality/function need to be developed/provided in a timely manner. As such, if changes in market
needs are more drastic than expected or the Group fails to provide the products that meet market needs in a timely manner, theGroup’s business performance may be affected. Especially, some health food products use agricultural produce, and if
contingencies, such as failure to supply raw materials due to other factors including the weather, occur to the product supply
system, the Group’s financial situation and business performance may be affected.
(19) Risks associated with weather
In the Group’s business activities, fluctuations in the demand of products caused by weather-related factors (weather,temperature) may affect the sales of products offered by the Group. As such, if the unfavorable weather lasts for a prolonged
period of time, the Group’s financial situation and business performance may be affected due to a temporary decline in sales
caused by the impact of consumers' purchasing behavior.
(20) Risks associated with natural disasters and other incidents
Some of Group's plants, warehouses, etc. were damaged by the torrential rains that occurred in July 2018, and business wasseverely affected. In 2019, the Group was also hit by natural disasters such as Typhoon Faxai and Hagibis. While the Group is
striving to improve the capability to continue business operations, events resulting from natural disasters may affect the Group’s
financial situation and business performance again in future. In addition, should natural disasters such as powerful earthquakes,
tsunamis, typhoons, etc. or other contingencies such as accidents, war, terror attacks, infections, social or political confusion,etc. occur in Japan or abroad in future, the Group’s financial situation and business performance may be affected due to a
disruption in the supply chain, damages to sales channel, physical damages to facilities owned by the Group, damages to
employees, etc.
In addition, with large-scale natural disasters such as Nankai Trough megathrust earthquake and earthquakes occurring
directly beneath the Tokyo Metropolitan Area in mind, in 2019, the Group reviewed and improved its Business Continuity Plan
(BCP) as necessary safety measure and measures for continuing business and enabling quick recovery.
(21) Risks associated with information security
The Group possesses IT systems that handle production, distribution, sales, etc., and important information on the operationsof the Group and corporations/individuals including a large number of customers. For the management of the information, theGroup observes related laws and ordinances and develops internal regulations, etc. In addition, the Group makes sure that
employees are fully aware of the importance of information management through education/training for employees, implements
the maximum preventive measures by way of precaution against unexpected system failure such as trouble with the system andhas been working on the development of a robust information management system. However, if unforeseeable events, such asa large-scale natural disaster, flaw in the system, infection with a new type of computer virus, hacking, malicious illegal accessand other security issues, occur, the Group’s financial situation and business performance may be affected.
(22) Risks associated with securing and development of personnel
For the Group to continuously develop its business, it is important to secure capable human resources and develop themcontinuously. In addition, it is also essential to actively hire new personnel from outside, share experience, technology,
knowledge, etc., with them, and build a working environment where they can contribute to business development together withpresent staff.
However, in recent years, the employment environment has been changing rapidly due to the declining birthrate, aging
population, and declining working population. If the acquisition and securing of personnel do not proceed as planned, theGroup’s financial situation and business performance may be affected in the long term.

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 the event 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 2019 Results
The Company announced the results of the fiscal year ended December 31, 2019 (January 1, 2019 to December 31, 2019).
In the current year, total nonalcoholic ready-to-drink (NARTD) beverage industry volume performance is estimated to be slightly
negative versus prior year mainly due to cycling of strong demand driven by hot summer weather last year as well as rainy andcool weather in July. The health food and cosmetics industries continue to grow, driven by demand from health-conscious
consumers and inbound tourism, while the competitive environment has been marked by successive product launches by various
industry players.
For CCBJH, 2019 has been a transition year focused on recovery from the flooding damage and disruption to product supply
in 2018 and building a solid foundation for future growth. We have been making major investments to recover our supply networkand progressively expand production capacity and will continue to do so through second quarter 2020. We were the first in thebeverage industry to announce and implement a wholesale price increase for large PET products in April, the first time in 27
years, as an important initiative toward achieving more balanced volume and revenue growth.
We developed and announced a new five-year strategic business plan in August 2019 with targets for both Business Income
margin and ROE in 2024 of 5 to 6%. The new five-year strategic business plan includes focused investments to reignite sales
growth in close collaboration with Coca-Cola (Japan) Company, Ltd. as well as fundamental transformation to drive cost savings.
Over the course of the five-year plan, we expect net cost savings of approximately 35 billion yen, representing ongoing savings
initiatives and incremental programs focused on transforming our vending channel operations, evolving our frontline salesforce
capabilities and identifying opportunities across procurement and our supply chain.
Our full-year results were impacted by a decline of topline revenue due to lower beverage business sales volume, reflecting
supply constraints of higher-growth aseptic PET products and continued lower manufacturing efficiencies and elevated logistics
and distribution expenses as we recover our supply and distribution infrastructure after the flooding in 2018. Business income
for our core beverage business was ahead of the plan we announced in May 2019, offset by weaker performance in the Healthand Skincare segment. Consolidated year-to-date results also reflect impairment of goodwill recorded in the second quarter.
2019 Highlights
・ Full-year NARTD beverage volume declined 2%, reflecting unseasonably cool and rainy weather in July and the wholesale
price increase in April, recovering to 1% growth in the fourth quarter (October to December). Full-year beverage businessrevenue declined 1% and grew 1% in the fourth quarter.
・ Beverage business market share improved, with value share growth ahead of volume share in the fourth quarter led by coffee,
non-sugar tea and sports category performance. Premium-priced new products contributed to value share growth・ Business Income (BI) was substantially in-line with the full-year plan announced in May 2019 led by ahead-of-plan core
beverage performance despite underachievement of the Healthcare & Skincare business. Full-year Business Income
decreased 35% versus prior year as we continue to recover from the supply disruption of 2018.
・ Full-year operating loss of 55 billion yen reflects the goodwill impairment recorded in the second-quarter.
・ Continued investment for recovery of supply network, expanding production capacity and improving infrastructure. Capital
investments of close to 90 billion yen in 2019, with three new manufacturing lines and two new automated warehouses, aswell as completion of company-wide deployment of a new ERP system, “CokeOne”.
・ Major transformational initiatives ongoing. Announced new organizational structure aligned with the strategic business planand grounded in new corporate mission, vision and value statement. Executing transformation in vending business andinvesting in people capability development to achieve sustainable growth.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
Review of Results
Full-year (January to December)
In Million JPY, IFRS

2018

2019

YoY

Net Revenue

927,307914,783(1.4)%

Gross Profit

452,151

441,060(2.5)%

426,195

423,685(0.6)%

Other income (Recurring)

1,635

1,083

(33.8)%

Other expenses (Recurring)

4,310

3,459

(19.7)%

(5)

43

－

23,276

15,042(35.4)%

Impairment losses of goodwill－

61,859－Other income (Non-recurring)

481

3,045

533.2%

Other expenses (Non-recurring)

9,075

11,61728.0%

Operating Income (Loss)

14,682(55,389)－

Net Income (Loss) Attributable to Owners of Parent

10,117(57,952)－

Sales volume of beverage business (Million cases)

515

503

(2)%

Selling, General & Administrative Expenses

Investment gain (loss) on equity method
Business Income

Q4 (October to December)
In Million JPY, IFRS

2018

2019

Net Revenue

216,991

220,020

1.4%

Gross Profit

102,766

103,7961.0%

106,252

104,874(1.3)%

Other income (Recurring)

522

194

(62.9)%

Other expenses (Recurring)

2,458

1,309

(46.7)%

149

133(11.2)%(5,272)(2,061)－Other income (Non-recurring)

－

908

－

Other expenses (Non-recurring)

137

2,357

1,625.6%

Operating Income (Loss)(5,409)(3,510)－Net Income (Loss) Attributable to Owners of Parent(2,737)(2,258)－

Sales volume of beverage business (Million cases)

119

119

1%

Selling, General & Administrative Expenses

Investment gain on equity method
Business Income (Loss)

YoY* Sales volume of beverage business excludes alcoholic beverage volume, which was 1.9 million cases in 2019.
* We have introduced “Business Income” as a measure of our underlying or recurring business performance after the adoptionof IFRS in 2019. Business income deducts cost of goods and SG&A from revenue and includes other income and expenses
which we believe recurring in nature.
Full-year 2019 net revenue was 914.8 billion yen, a decrease of 12.5 billion yen, or 1.4% compared to the prior-year period.
Net revenue of the beverage business decreased 9.9 billion yen (1.1%) versus the prior-year period, to 890 billion yen, reflecting
a 2% volume decline offset by improved price/mix from the wholesale price increase of large PET packages in April and thenational launch of Lemon dou “chu-hi” alcohol beverage in the fourth quarter. Net revenue of the Healthcare & Skincare businessdeclined 2.7 billion yen (9.7%) year-on-year to 24.8 billion yen, reflecting continued weakness of mail/web order sales withsome recovery in the fourth quarter due to new product launches and marketing activities.
Full-year business income, an indicator of our recurring business performance, was 15.0 billion yen, a decrease of 8.2 billion,
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
or 35.4% year-on-year, and roughly in line with full-year expectations. Business income of the core beverage business was 11.4
billion yen (down 6.5 billion yen or 36.2% year-on-year), which was slightly above the revised plan target announced in May
driven by tight control of expenses. The beverage business performance reflects weaker topline revenue due to the sales volume
decline of 2% and continued lower manufacturing efficiencies and elevated logistics and distribution expenses this year as werecover and expand supply capacity after the disruption in the second half of 2018. Partly offsetting this pressure, we achievedlabor savings as a result of integrating retirement benefit programs in the first quarter and completing a voluntary employee
retirement program in the second quarter. Promotional expenses in the period were also lower, in line with volume performance.
Business income in the Healthcare & Skincare business was 3.6 billion yen, a decrease of 1.7 billion yen or 32.7% year-on-year,
reflecting lower revenues while we continue to focus on promotional expense control and other cost savings opportunities.
We reported a consolidated operating loss for the fiscal year of 55.4 billion yen (14.7 billion yen operating income in prior year
period), mainly driven by the impairment of goodwill recorded in the second quarter. As a reference, other expenses (nonrecurring) in the prior-year period include loss on disaster of 8.9 billion yen from the flooding damage in our Hongo Plant in
Mihara-city, Hiroshima Prefecture in July 2018. Other expenses (non-recurring) in 2019 include 9.2 billion yen of special
retirement allowance and 655 million yen of transformation-related expenses to drive fundamental transformation of our businessfor sustainable growth, further value creation and efficiency improvement following our newly developed strategic business planannounced in August 2019.
Net income attributable to owners of parent was a loss of 58.0 billion yen (10.1 billion yen in the prior-year period).
(2) Cash Flow
The cash flow conditions for the full-year are as follows.
<Cash Flows from Operations>
Net cash used for operations was 42.6 billion yen (51.2 billion net cash generated from operations in the previous year period).
This results mainly from the 55.4 billion yen net loss before tax, due to impairment of goodwill, depreciation expenses, increaseof notes and account payable-trade, partially offset by an increase of trade and other receivable, inventories, payment of taxes.
<Cash Flows from Investment Activities>
Net cash used for investment activities was 68.3 billion yen (48.6 billion yen in the previous year period), due to purchases of
fixed assets as we recover our supply network and progressively expand production capacity, etc.
<Cash Flows from Financing Activities>
Net cash generated from financing activities was 74.0 billion yen (55.8 billion yen net cash used for financing activities in theprevious year period), driven by issuance of 150 billion yen straight bond, etc., partially offset by cash spent for share buy-back,payment of year-end dividends, etc.
As a result of these activities, cash and cash equivalents at the end of the fiscal year was 113.8 billion yen, an increase of 48.3
billion yen versus the prior year period(3) Differences in major items regarding overview of operating results.
Differences between the main items in the consolidated financial statements prepared in accordance with IFRS and the items
corresponding to these items in the consolidated financial statements prepared in accordance with Japanese GAAP are as follows:① Property, plant and equipment
Under Japanese GAAP, the depreciation method for property, plant and equipment was changed from the declining-balancemethod to the straight-line method in the fiscal year ended December 31, 2017. In IFRS, it was the straight-line method fromthe beginning of the acquisition of property, plant and equipment. As a result, cost of sales and selling, general andadministrative expenses for the current fiscal year increased by 4.6 billion yen compared with Japanese GAAP.
② Goodwill
Under Japanese GAAP, goodwill was amortized on a regular basis over the periods for which the effects were reasonably
estimated to be realized. Under IFRS, goodwill is not amortized but instead tested for impairment at least annually. As a result,selling, general and administrative expenses for the current fiscal year decreased by 1.6 billion yen compared with Japanese
GAAP.

20

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.
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
Healthcare & Skincare business
Total

Year-to-year comparison (%)

488,046

97.7

2,544

85.6

490,590

97.6(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

Year-to-year comparison (%)

Beverage business

52,408

72.9

Healthcare & Skincare business

2,301

76.3

54,70973.0

Total(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

Year-to-year comparison (%)

Beverage business

890,009

98.9

Healthcare & Skincare business

24,774

90.3

914,783

98.6

Total

(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%.

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 the event 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 53.1%, 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)
Assets at the end of the current fiscal year were 952.4 billion yen, an increase of 75.0 billion yen from the end of the previous
fiscal year. This is mainly attributable to an increase of Cash and cash equivalents by bond issuance in the third quarter,
increase of fixed assets as a result of commissioning three new production lines in Kumamoto and Kyoto plants, and two new
automated warehouses in Hakushu and Kumamoto plants as well as non-current assets by newly including Right-of- use assets
as a result of the implementation of IFRS 16 (Leases) starting from this fiscal year, which are partially offset by decrease of
goodwill by goodwill impairment in the second quarter.
(Liabilities)
Liabilities at the end of the current fiscal year were 446.0 billion yen, an increase of 149.4 billion yen from the end of
previous fiscal year. This is mainly due to an increase of Bonds and debt in non-current liabilities due to issuance of the bond,and an increase of Lease liabilities in conjunction with including Right-of-use assets.
(Net assets)
Net assets at the end of the current fiscal year were 506.5 billion yen, a decrease of 74.4 billion yen. This is mainly due toa decrease of Retained Earnings as a result of the goodwill impairment and an increase of Treasury Shares due to thecompletion of the share buyback program in February 2019.
Also, cash and cash equivalents as of December 31, 2019 was 113.8 billion yen, which increased by 48.3 billion yen, or
73.8%, from the previous fiscal year as of December 31, 2018. See the consolidated statements of cash flows in " Overview
of financial 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 "1. 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.
(Revenue)
Revenue for the current fiscal year decreased 12,524 million yen, or 1.4%, from the previous fiscal year to 914,783 million
yen.
(Operating loss)
Operating loss for the current fiscal year decreased 70,071 million yen, from the previous fiscal year to 55,389 million yen(The previous year's operating income was 14,682 million yen).
(Net loss for the current fiscal year)
Net loss for the current fiscal year for the fiscal year decreased 68,057 million yen, or from the previous fiscal year to 57,895
million yen. (The previous fiscal year's net income was 10,162 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 decreased 68,069 million yen, from theprevious fiscal year to 57,952 million yen. (The previous year's Net income for the year attributable to owners of the parent
was 10,117 milion 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."
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.

4. Important agreements for businessWe 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, and35 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
Research and development activities in the Healthcare & Skincare business during the current fiscal year are small, and there areno specific items to state here.

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 the event 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 103,882 million yen, primarily in the Beverage business, which is the main
segment of the Group, during the current fiscal year. This was mainly due to the introduction of vending machines and others to themarket in order to strengthen sales capabilities, improvements in manufacturing efficiency, and the acquisition of facilities for
dealing with new products. Capital expenditures include the amounts for property, plant and equipment, right of use assets andintangible 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, 2019
Carrying amount
Name of reporting segment

Buildings andstructures(Millions of yen)

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

Land
(Millions of
yen)

Other
(Millions of
yen)

Total
(Millions of yen)

Number of
employees(People)Beverage business

85,38588,792

119,006

148,771

74,525

516,480

16,465[3,582]

Healthcare & Skincare business

1,264

582

－

1,144

2,032

5,022

494
[170]

Total

86,65089,375

119,006

149,915

76,557

521,502

16,959[3,752](NOTE) Figures in [ ] of number of employees are the number of temporary workers.
(2) The reportable segments
As of December 31, 2019
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)

26,90223-

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

51,620(1,514)

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

5,089

83,634-(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.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
(3) Domestic subsidiaries
As of December 31, 2019
Carrying amount
Name ofreportingsegment

Name(Location)

Coca-Cola Bottlers
Japan Inc.
(Minato-ku, Tokyo)
FV Japan Co., Ltd.
(Minato-ku, Tokyo)

Details offacilities(Chuo-ku, Fukuoka-shi)

Land(Millions ofyen)[Squarefootage: inthousands ofm2]

87,869104,568(2,213)bases, etc.

392,436

157

16,151

2,032

5,022

10,625[2,303]668

53

machines, etc.

& Skincare

69,173[139]

Vendingditto

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

73,16757,659sales, logistics

businessbusiness

Vending
machines(Millions ofyen)

Production,

Beverage

Healthcare

Q'SAI CO., LTD.

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

128

15,145

(15)
[5]

452
[310]

Production
facilities for

1,264

health food

582

1,144

－

(56)

396
[75]

products(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)

Way offinancing

Acquisition ofvending
machines andcooler, etc.

30,000-ditto

Production
facilities

25,874

ditto

Logistics
equipment

33,500Coca-Cola
Bottlers
Japan Inc.

Each branch(-)

Beveragebusiness

ditto

Hiroshimaplant(Mihara-shi,
Hiroshima
Prefecture)ditto

2 Warehouse(-)(NOTE) Figures do not include consume tax, etc.

25

Scheduledstart date

Scheduledcompletiondate

Own fundJan. 2020

Dec 2020

5,873

Own fund andDebt within
the group

Mar 2019

Jun 2020

4,707

Own fund andDebt within
the groupJan 2019

Dec 2021

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.

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, 2019)

Number of issued sharesat the filing date(shares)(As of March 27, 2020)

206,268,593

206,268,593

206,268,593

206,268,593

Commonstock
Total

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

Tokyo Stock Exchange(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.

26

Number of shares per(First Section)
share unit: 100 shares
Fukuoka Stock Exchange--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.
(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, 2019
Status of shares (number of shares constituting one unit: 100 shares)
Category

National andlocal
governments

Financial
institutions

Financial
Other
service
corporations
providersNumber of shareholders(people)

-

70

28

Number of shares held
(units)-

333,978

Percentage of shareholdings
(%)

-

16.26

Foreigners

Individuals
and others

Total

Number ofshares lessthan one unit
(Shares)

Other than
individual

Individuals

773

494

74

61,21962,658-12,006

674,522521,421297

512,032 2,054,256

842,993

0.58

32.84

25.38

0.01

24.93

100.00(NOTE) 1. "Individuals and Others" and "Shares less than one unit" column include 269,173 units and 20 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.

27-

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.
(6) Major shareholders
As of December 31, 2019

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

7,460

4.16

Ichimura Foundation of New Technology

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

5,295

2.95

STATE STREET BANK AND TRUSTCOMPANY 505225(Standing proxy Settlement & Clearing &Services Division, Mizuho Bank, Ltd.)

P.O. BOX 351 BOSTONMASSACHUSETTS 02 101 U.S.A.
(2-15-1 Konan, Minato-ku Tokyo)

4,725

2.63

4,699

2.62

Satsuma Shuzo Co., Ltd.

26 Kamimotocho, Makurazaki-shi,
Kagoshima

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,

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

Ltd.

Hyogo

3,912

2.18

Japan Trustee Service Bank, Ltd. (Trust Account)

1-8-11, Harumi, Chuo-ku, Tokyo

3,747

2.09

MCA Holdings, Co., Ltd.

2-6-15, Kyobashi, Chuo-ku, Tokyo

3,408

1.90

69,365

38.68

Total

-

(Notes) 1.While it was stated that Mondrian Investment Partners Limited owned 14,714 thousand shares of the Company in a Report fora Statement of Large-Volume Holdings (dated August 14 2019) that was made available for public inspection on August 19,
2019, this is not included in the status of major shareholders above because it was not possible for the Company to confirm
the actual number of shares as of the end of FY 2019.
Number of shares held
Percentage of shares held
Name
Address(thousand shere)(%)
10 Gresham St, London
Mondrian Investment
EC2V 7JD
14,714
7.13
Partners Limited
United Kingdom
2. 26,917 thousand treasury shares are not included in the status of major shareholders above because they do not have voting
rights.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
(7) Voting rights① Issued shares
As of December 31, 2019
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

26,917,300

Common178,508,300

stock
CommonShares less than one unit

1,785,083-

842,993--

Number of issued and outstanding shares

206,268,593--

Number of voting rights of all shareholders

-

stock

1,785,083-(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, 2019
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.

7-9-66, Hakozaki,
Higashi-ku,
Fukuoka

26,917,300－

26,917,300

13.05

-

26,917,300－

26,917,300

13.05

Total

2. Acquisition of treasury stock
Classes of shares: Acquisitions of common stock falling under Article 155, Paragraph 3 and 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
Category

Number of shares (Shares)

Total amount (Yen)

Resolutions of the Board of Directors (November 9, 2018)(Acquisition period: November 12, 2018 to May 31, 2019)

10,800,000

25,000,000,000

Acquired treasury stock prior to the fiscal year

3,696,400

12,011,492,389

Acquired treasury stock during the fiscal year

4,120,300

12,988,290,367

Total number and value of remaining resolution shares

2,983,300

217,244

27.6

0

-

-

Percentage of unexercised at the end of the fiscal year (%)
Acquired treasury stock during the period (January 1, 2020 to thefiling date of this report)
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
27.6

Percentage of unexercised at the filing date (%)

300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.
(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, 2020 tothe filing date of this report)

Total amount (Yen)

5,044

13,704,399

830

2.398.198(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 4th, 2020 to the filing date.
(4) Disposals and holding of acquired treasury stock
The period (January 1, 2020 to thefiling date of this report)
Total disposed
Number of sharesamount(Shares)(Yen)

The fiscal year
Category

Number of shares(Shares)Acquired treasury stock for which subscribers

Total disposed
amount
(Yen)

-

-

-

-

-

-

-

-

-

-

-

-

1,073

3,414,271

25

79,548have been solicited
Disposals of acquired treasury stock by
cancellation
Acquired treasury stock transferred due tomerger, share exchange, or company split
Other(Sale by request for the purchase of odd-lot
shares)(Note 1)
Number of treasury stock held (Note 2)

26,917,320-

26,918,125-(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 4th, 2020 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 4th, 2020 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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.

3. Dividend policy
We periodically review our capital structure and dividend payout ratio, while maintaining the financial flexibility for growth
opportunities in order to maximize shareholder returns. We may utilize retained earnings for investments for sustainable growth
to pursue business growth and further enhancement of corporate value.
With regard to dividends, our basic policy is to willingly distribute our profits to shareholders, though our first priority is put on
stable dividend payment. From the fiscal year ended December 31, 2019 (after adoption of IFRS), our stated policy is to pay
interim and year-end dividends (twice a year) at the level of 30% or more of net profit attributable to owners of the parent,
considering our results and retained earnings in a comprehensive way.
Dividend for the fiscal year ended December 31, 2019 was 50 yen per share (year-end dividend of 25 yen per share and interim
dividend of 25 yen per share).
Dividend for the fiscal year ended December 31, 2020 is expected to be 50 yen per share (year-end dividend of 25 yen per shareand interim dividend of 25 yen per share), the same amount as for the fiscal year ended December 31, 2019, based on the basic
policy described above and the earnings forecast for the fiscal year ending December 31, 2020, as well as on our priority of stabledividend payment.
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 7, 2019
Resolution of the Board of
4,484
25
Directors
March 26, 2020
Resolution of the Ordinary
4,484
25
General Meeting of
Shareholders

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 the event 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 efficiency and transparency and increase inshareholder 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 the event 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

Hiroko Wada (Outside Director),and other items relating to

Hirokazu Yamura (Outside Director),

important business matters such

Irial Finan (Outside Director),

as managerial basic policies.

Celso Guiotoko (Outside Director),(b) The Board of Directors shall

Nami Hamada (Outside Director),

receive Directors’ report on their

Enrique Rapetti (Outside Director)

execution of the duties.
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),
Nami Hamada (Outside Director),(b) Determination of the contents of

Enrique Rapetti (Outside Director)

proposals regarding the election,
dismissal or disapproval ofreappointment 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 the event 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 the event 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. Please note that a part of the Policy has been reviewed at the Board of Directors Meeting held on March 26, 2019.
The Basic Policy after being reviewed 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’ performance of their duties
in documents 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. Suchemployees shall execute the duties
under the instructions given by the Audit and Supervisory Committee in assisting executions of duties by 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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
Supervisory Committee and shall not receive instructions from directors (excluding directors serving on the Audit andSupervisory 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)
In order to prevent the occurrence of the Company's various risks and to ensure prompt and appropriate action to minimize
damage in the event of a risk, "Coca-Cola Bottlers Japan Group Risk Management System" has been established. In addition, we
have developed Code of Ethics and Conduct for officers and employees of the Group, which shows the Group's corporate stanceof "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.

37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.
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 interim
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.

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 the event 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)
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
April 5, 1968 2018
Executive Officer, Head of Finance, Coca-Cola
Bottlers Japan Sales Support Inc.
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.
(incumbent)
December Chairman and Representative Director, Q’SAI
2019
CO., LTD (incumbent)

39

One yearfrom theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2020

One yearfrom theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2020

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 of Japan. In the event 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 2020

1

One yearfrom theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2020-

One yearfrom theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2020-

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)

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 the event 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(incumbent)
April 2017 Outside Director (Audit & Supervisory
Committee member), Coca-Cola Bottlers JapanInc.
January 2018 Outside Director (Audit & Supervisory
Committee member), Coca-Cola Bottlers Japan
Holdings Inc. (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 2019-

March 1996 System Director, Toshiba America Electroinc
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 2019
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)

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 the event 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 2019-

Two years
from theOrdinary
GeneralMeeting of
Shareholders
held onMarch 2020-

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

Enrique
RapettiAugust 3,
1964

October 22,
1976,

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. (incumbent)
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)
December Joined Arthur Andersen
1998
May 2000 Joined The Coca-Cola Company Argentina.
January 2010 Controller, Mexico Latin America Group, The
Coca-Cola Company
August 2014 CFO, Costa Rica Latin Center Business Unit, The
Coca-Cola Company
September Director, Embotelladora Andina S.A. (incumbent)
2016
October 2016CFO, Latin America Group, The Coca-Cola
Company (incumbent)
April 2020

Outside Director (Audit & Supervisory
Committee member), Coca-Cola Bottlers Japan
Holdings Inc. (incumbent)
Total

2

(NOTE) 1. Hiroshi Yoshioka, Hiroko Wada, Hirokazu Yamura, Irial Finan, Jennifer Mann, Celso Guiotoko, Nami Hamada and
Enrique Rapetti are Outside Directors.
2. The Company has introduced a corporate executive officer system to accelerate the execution of business and clarify
responsibilities. The total number of executive officers is 21, including representative directors.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
Information of outside directors
Currently, two 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 -OutsideDirector

Hirokazu
YamuraOutsideDirector(Audit&Irial Finan
Supervisory
Committee
member)OutsideDirector(Audit& CelsoSupervisory Guiotoko
Committee
member)OutsideDirector(Audit& NamiSupervisory Hamada
Committee
member)OutsideDirector(Audit& Enrique
Supervisory Rapetti
Committee
member)-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 are 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 are 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 andPresident of Michinoku Coca- The Company proposes to appoint Hirokazu Yamura as a Director (Outside Director) in order for
Cola Bottling Company, Co., him to utilize, for the management of the Company, the considerable experiences and knowledge
Ltd. (hereafter “Michinoku he has gained thus far as the Representative Director and President of Michinoku CCBC.
CCBC)”, which is a trading The Company also has transactions with the group companies of Michinoku CCBC, but thepartner of the Company. The transaction volume is very small. In addition, the trading prices and other terms and conditions
amount of sale of products, etc. applied to these transactions are fair and consistent with the trading prices and other terms andto Michinoku CCBC is conditions applied to transactions with other trading partners. We therefore believe that these groupequivalent to 0.38% of the companies of Michinoku CCBC pose no risk of obstruction of our free and fair business activities.
Company’s consolidated net The Company has designated Hirokazu Yamura as an independent director based on our judgment
revenue, and the amount of that the current transactional ties with Michinoku CCBC and its group companies do not have any
purchase of products, etc. from significant impact on our business, and that there are no relationship of special interest between him
Michinoku CCBC is equivalent and the Company, and no risk of causing any conflict of interest with general shareholders.
to 1.76% of the consolidated
revenue of Michinoku CCBC.
The Company has appointed Irial Finan as a Director serving on Audit & Supervisory Committee(Outside Director) because he has considerable experiences and global expertise having acted as acorporate executive engaged in Coca-Cola business over many years acting as a representative of
the Bottling Investments Group engaging in oversight of The Coca-Cola Company management
and Coca-Cola bottlers worldwide, and possesses audit experiences as Directors serving Audit &supervisory Committee at our Company. As such, we deed him suitable of providing advice on allareas of decision making related to important managerial decisions and handling of expected risks.
The Company has appointed Celso Guiotoko as a Director serving on Audit & Supervisory
Committee (Outside Director) because he has considerable experiences and global expertise gainedat Nissan Motor Co., Ltd. (“Nissan”) and possesses audit experiences as Statutory Auditor at Nissan.
As such, we deed him suitable of providing advice on all areas of decision making related toimportant managerial decisions and handling of expected risks.
There are 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 Nami Hamada as a Director serving on Audit & Supervisory
Committee (Outside Director) because she has considerable experiences on Finance and Accounting
gained as a proprietor of her own finance consulting company and considerable experiences andglobal expertise gained as Director at Lehman Brothers Japan Inc. As such, we deed her suitable ofproviding advice on all areas of decision making related to important managerial decisions andhandling of expected risks.
There are 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.
Enrique Rapetti is the Chief Enrique Rapetti is the Chief Financial Officer of The Coca-Cola Company’s Latin America group.
Financial Officer of The Coca- The Company proposes to appoint Enrique Rapetti as a Director serving on the Audit andCola
Company’s
Latin Supervisory Committee (Outside Director), based on the view that his rich experience in executive
America group. The Company management in The Coca-Cola Company’s Latin America group and his rich knowledge on financehas agreements with The Cola- and accounting will be very beneficial for the management of the Company, when he serves the role
Cola Company on the of providing advices and recommendations as the member of the Audit and Supervisory Committee
manufacture and sale of Cola- on all matters in the Company including those related to important business management decisions
Cola, etc., and on the use of and actions to prevent the emergence of foreseeable risks.
trademarks, etc

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 the event 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. 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).

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 the event 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.
b. Internal Audit Status
We have established the Audit Office (18 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) 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
Liability Partner

Years of audit

Tokuya Takizawa

3 years

Engagement
Partner

Kazuhiko Yamazaki

7 years

Designated Limited
Liability Partner

Engagement
Partner

Takahiro Saga

2 years

Designated Limited

Engagement

Liability Partner

Partner

Miyuki Nakamura

5 years

The number of consecutive audit years include the number of years relating to the former Coca-Cola East Japan Co., Ltd(c) Composition of assistants involved in audit work
41 certified public accountants and 49 others were involved as audit assistants.
(d) 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.
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
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.
(e) 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.
(f) 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

64

-

71

3

Consolidated
subsidiaries

136

-

129

-

Total

200

-

200

3

②Remuneration for organizations belonging to the same network as auditing certified public accountants (excluding ①.)
Not applicable.
③Other material remuneration to independent auditors
Previous fiscal year (January 1, 2018 to December 31, 2018) and current fiscal year (January 1, 2019 to December 31,
2019)
Not applicable.
④Details of non-audit services rendered by independent auditors
Previous fiscal year (January 1, 2018 to December 31, 2018)
Not applicable.
Current fiscal year (January 1, 2019 to December 31, 2019)
The Company pays 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).
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.

46

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.
(4) Details and procedures on compensation of Directors and Executive Officers①. Compensation policy and process for determining the policya.
Basic policy on compensation for Executive Directors and Executive Officers(a). Compensation level and structure that enable hiring and retaining high-quality talents from the perspective of
diverse nationalities and experiences.
(b). Compensation composition ratio emphasizing performance-linked compensation, resulting in providing sufficientincentives for profitable growth.
(c). Introduce the system to further improve mid-to-long-term corporate value and reinforce alignment of interests withthe shareholders.
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 are appropriate as roles in managerial supervision and audit
c.
Process for determining the policy
The policy for determining compensation for Executive Directors and Executive Officers, etc. shall be determined
upon deliberation by the Audit and Supervisory Committee and approval through the Company’s Board of Directors
Meeting.
② Details and procedures on compensation of Executive Directors and Executive Officersa.
Compensation structure (FY2020 onwards)
Fixed
compensation

Base salaryMonthly payment of an amount determined based on responsibilities.

Retirement Payment(Annual deferral for
retirement
remiunications)
Annual bonus



10% of annual base salary is retained each year and the cumulative
amount is paid upon retirement. If the Director has caused significant
damage to the CCBJH Group or been subjected to disciplinary action, thispayment may be reduced or withheld altogether.
Provided as an incentive for achieving performance targets for each fiscal
year.
The target amount is set in the range of 35% to 75% of base salarydepending on their responsibilities.
The amount of payment varies in the range of 0% to 225% of the target
amount depending on the achievement of performance targets in eachfiscal year (companywide performance and individual evaluations).
Business income, sales volume, and net sales have been adopted asmeasures for evaluating companywide performance in accordance withthe policy for determining compensation for Executive Directors andExecutive Officers, etc.






Variable compensation

47

Compensation limit
for Directors:
Maximum 850
million yen peryear (approved byresolution no. 5 of
FY2019 Annual
General Meeting of
Shareholders).
(the number of
directors at the timeof the resolution
excluding directors
who were Audit
and Supervisory
Committee
members was 5).
* In case where the
Audit andSupervisory
Committee hasdeliberated anddeemed itnecessary, housing
allowances others
may be paid
within this 850
million yen.

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.
Long-term incentives 
Two types of stock-based compensation systems, (1) PSU and (2) RSU, Compensation limit
are adopted as long-term incentives.
for Directors:
The basic amount of all long-term incentives (1) PSU + (2) RSU is set in Maximum amountthe range of 40% to 100% of base salary based on the responsibilities. of 200,000 shares
80% of this basic amount is set as the basic PSU amount, and 20% is set approved byas the basic RSU amount.
resolution No. 5 ofWith regard to (2) RSU, additional grants for the purpose of retention may FY2019 Annual
be made in addition to the above-mentioned basic RSU amount up to the General Meeting ofcompensation limit detailed on the right if deemed necessary by the Audit Shareholders).
and Supervisory Committee.
(the number of(1) PSU
Provided as an incentive for achieving mid to long term performance directors at the time
(Performanceof the resolution
targets.
Share Units)The number of shares to be issued shall be determined within the range excluding directors
of 0% to 150% of the basic PSU amount depending on the achievement who were Auditof performance targets (only considering companywide performance) and Supervisory
over the three years after the share units have been granted (half of the Committee
shares to be issued shall be paid in cash for the purpose of allocating funds members was 5).
(2) RSU (Restricted
Stock Units)





b.

for the payment of tax obligations).
Consolidated ROE and growth rate of consolidated net sales are used asmeasures of performance in accordance with the policy for determining
compensation for Executive Directors and Executive Officers, etc.
Provided for the purpose of aligning interests with shareholders, creating
incentives to increase corporate value, and strengthening retention oftalented people.
Issued predetermined number of shares three years after shares 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).

Process for determining compensation
Compensation for Executive Directors shall be deliberated by an Audit and Supervisory Committee composed solely
Outside Directors to enhance the transparency and objectivity of procedures for determining compensation. Then, theCompany’s Board of directors meeting resolves and delegates the determination of the compensation including theamount of performance-linked compensation for each Executive Directors to a Representative Director in accordancewith the “Compensation Framework for Directors and Executive Officers” approved by the Company’s Board of Directors
Meeting as well as within the total amount of executive compensation resolved by the General Meeting of Shareholders.
The compensation for Executive Officers shall also be determined through deliberations by the Audit and Supervisory
Committee.
(a) Activities of the Company’s Board of Directors Meeting
The Company’s Board of Directors Meeting activities concerning the determination of Executive compensation for
FY2019 are as follows.
1.
Number of meetings of the Company’s Board of Directors Meeting over one year from January 2019 to
December 2019: 8
2.
Main subjects discussed by the Company’s Board of Directors Meeting concerning Executive compensation andExecutive compensation structure in FY2019:
Payment of Annual bonuses for 2018 and special incentives for 2017
The compensation for Directors (excluding Directors serving on the Audit and Supervisory Committee)
and Executive Officers for FY2019

Revision of performance indicators following changes to accounting standards with regard to performancelinked stock-based incentive compensation for 2018; performance indicators concerning performancelinked stock-based incentive compensation for 2019

Revision of performance indicators following changes to accounting standards in relation to Annual
bonuses for 2019 and special incentives for 2018

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
(b) Activities of the Audit and Supervisory Committee
Activities of the Audit and Supervisory Committee concerning the determination of Executive compensation for
FY2019 are as follows.
1.
Number of meetings of the Audit and Supervisory Committee over one year from January 2019 to December
2019: 82.
Main subjects discussed by the Audit and Supervisory Committee concerning Executive compensation andExecutive compensation structure in FY2019:
Individual amounts to be paid, etc. in relation to Annual bonuses for 2018 and special incentives for 2017
The compensation for Directors (excluding Directors serving on the Audit and Supervisory Committee)
and Executive Officers for FY2019
The compensation for Directors serving on the Audit and Supervisory Committee for FY2019

Revision of performance indicators following changes to accounting standards with regard to performancelinked stock-based incentive compensation for 2018; performance indicators concerning performancelinked stock-based incentive compensation for 2019

Revision of performance indicators following changes to accounting standards in relation to Annual
bonuses for 2019 and special incentives for 2018

Executives’ individual objective targets for FY2019 Annual bonusesIntroduction of long-term incentive system from FY2020 onwards

Revision of amounts of compensation for Directors (excluding Directors serving on the Audit andSupervisory Committee)
Introduction of stock-based compensation system (RSU)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 serving on the Audit and Supervisory Committee and Outside
Directors not serving on the Audit and Supervisory Committee) consists of only base salary, taking into account their roles inmanagerial supervision and audit. Compensation levels are set according to the role of the Director by utilizing data fromcompensation surveys performed by external research organizations and taking into account the level of compensation
provided at domestic companies of similar scale.
The compensation for Directors serving on the Audit and Supervisory Committee is proposed to the Audit and Supervisory
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
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
serving on the Audit and Supervisory Committee shall be delegated to a Representative Director upon resolution by theCompany’s Board of Directors Meeting, and the amount shall be determined by the Representative Director in accordancewith the “Compensation Framework for Directors and Executive Officers” approved by the Company’s Board of Directors
Meeting after the terms of compensation are deliberated by an Audit and Supervisory Committee.
④ Details of compensation for Directors for FY2019a.

Total amount of compensation, etc. by position, total amount of compensation by category and headcount of Directors
Total amount by category of compensation (millions yen)
Position

Directors (excluding
Directors serving on the
Audit and Supervisory
Committee)

Total
compensation(millions yen)

Basiccompensation
Note 3:

Annual bonus

Performancelinked stock-based
incentivecompensation

Headcount of
Directors(people)

582
(23)

436
(23)

96
(－)

50
(－)

8
(2)

71
(62)

71
(62)

－

－

(－)

(－)

7
(6)

(of which Outside Directors)
Directors (serving on the
Audit and Supervisory
Committee)(of which Outside Directors)
96
50
653
508
15
Total
(85)
(85)
(8)
(－)
(－)
(of which Outside Directors)
Note 1: In accordance with the resolution taken at the 59th Annual General Meeting of Shareholders held on March 22, 2017, theupper limit of compensation for Directors (five in number at the time of the resolution excluding Directors serving on the
Audit and Supervisory Committee) shall be 750 million yen per year (of which 50 million yen per year for Outside Directors(one in number at the time of the resolution); in accordance with the resolution taken 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 paid to three Directors (excluding Directors serving on the Audit and Supervisory
Committee) and three Directors (serving on the Audit and Supervisory Committee, of which two Outside Directors), who are
resigned at the conclusion of the 61st Annual General Meeting of Shareholders held on March 26, 2019.
Note 3: Basic compensation includes Retirement payments (Annual deferral for retirement remiunications), special incentives for
2018, and an amount equivalent to fringe benefits, (housing allowance).

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
b.

Total compensation of persons whose total compensation is 100 million yen or more
Total amount by category of compensation(millions yen)Company
PerformanceName
PositionBasic
category
linked stockcompensation
Annual bonus
based incentive
Note:compensation

Total
compensation(millions yen)

Calin Dragan

Representative
Director

Filingcompany

225

66

32

322

Bjorn Ivar Ulgenes

Representative
Director

Filingcompany

100

26

13

139

Note: Basic compensation includes Retirement payments and an amount equivalent to fringe benefits, (housing allowance).
c.

Significant employee salary received by the officer concurrently serving as an employee
Not applicabled.
Target, actual results and payment rates of incentive compensation(a) The company performance evaluation of Annual bonuses for FY2019 was measured by the achievement level of businessincome, sales volume, and net sales, which were selected as appropriate indicators to evaluate the Company performance basedon Mid-term strategic business plan to achieve Business Income margin of 2.0%. The result of the companywide performance
evaluation was 75.0% in FY2019 measured by the achievement level of such indicators. By adding the payment coefficient forindividual evaluation, 82.5% was the total payment rate (ratio of actual payment amount to target amount).
(b) Evaluation period of special incentive for 2018 was the two years from 2018 to 2019. The Company performance evaluationof special incentive for 2018 was measured by the achievement level of Business Income, synergy, and net sales for the
cumulative total of two years, which were selected as appropriate indicators to evaluate the Company performance aimed at
1.0% sales growth in the first year to improve company performance. The result of the Company performance evaluation was
80.0% measured by the achievement level of such indicators. The ratio of actual payment amount to target amount of special
incentive for 2018 varies in the range of 0% to 150% based on the achievement level. Based on the evaluation described above,
80.0% was the total payment rate (ratio of actual payment amount to target amount). In order to use special incentives for 2018as a driving force for improvements in performance along with an increase in sales from 2018 onwards, the special incentives
for 2018 shall be paid with FY2018-2019 as the target period; this was decided upon deliberation by the Audit and Supervisory
Committee. There is no plan in place for a payment of special incentives from FY2020 onwards.

51

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.
(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 inwhich the Company acquires and holds such shares to create business opportunities and maintain and strengthen its
relationships with business partners and local communities. The Company regularly assesses and reports the associatedholding costs and investment returns for its major cross-shareholdings, and work on the reduction of cross-shareholdings
based on the result of this assessment.
(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

123

4,797

Shares other than unlisted
shares99

22,012(Brands that the Company increased the number of shares in this fiscal year)
Number ofcompanies
Unlisted shares
Shares other than unlisted
sharesTotal amount spent to increase
the number of shares held (inmillions yen)-

Reason for increasing the number of shares-

The Company increased the number of shares ofthese companies by purchasing through47
suppliers’ share ownership association of thesecompanies

23(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

22

Shares other than unlisted
shares

7

2,242

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 the event 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
Whether thecounterparty
Purposeandquantitative
effectofholdingtheshares,andNumber of shares
Number of sharescompany isreason for increasing the number of shares
Amount recorded in the Amount recorded in theholding the(Note 1)balance sheet
balance sheet
Company’s(in millions yen)(in millions yen)shares or not
The Company is holding the shares of this company
3,432,862
3,432,862
brand for the purpose of building, maintaining orNostrengthening the relationship with the company brand as
4,092
3,697
an important business partner.
662,440
662,440 The Company is holding the shares of this company
brand for the purpose of creating new beverage business Yes
1,638
1,688 opportunities with this company.
The Company is holding the shares of this company
1,308,125
1,308,125brand for the purpose of building, maintaining orYes
strengthening the relationship with the company brand as
1,562
1,425
an important business partner.
54,10054,100 The Company is holding the shares of this company
brand for the purpose of creating new beverage business No
1,190
1,253 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
1,134
1,117 opportunities with this company.
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
1,008
1,106 purpose of building, maintaining or strengthening therelationship with the local economy.
Current fiscal year
Company name

RICOH Co., Ltd.
ROYALHOLDINGS Co.,Ltd.
SAN-AI OIL Co.,
Ltd.
Central Japan
Railway Company
East Japan Railway
Company

Nishi-Nippon
Railroad Co., Ltd.
KYUSHULEASINGSERVICE CO.,LTD.
IZUMI Co., Ltd.
Japan Airport
Terminal Co., Ltd.

Previous fiscal year

1,600,000

1,600,000

946

1,021

231,320

231,320

910

1,182

100,000

100,000

609

381

138,484

133,789

554

640

604,962

604,962518

580

33,802

33,618503

372

275,121275,121501

640

244,366

244,366

476

457

Seven & i Holdings
Co., Ltd.

Nishi-Nippon
Financial Holdings,
Inc.

Oriental Land Co.,Ltd.

ZENRIN CO., LTD.

Fuji Co., Ltd.

The Company is holding the shares of this company
brand for the purpose of building, maintaining or No
strengthening the relationship with the local economy.
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 creating new beverage business
opportunities with this company.
No
The Company increased the number of shares of thiscompany by purchasing through suppliers’ shareownership association of this company
The Company is holding the shares of this company
brand for the purpose of building, maintaining or No
strengthening the relationship with this company and the (Note 2)
local economy.
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 by purchasing through suppliers’ shareownership association of this company
The Company is holding the shares of this company
brand for the purpose of building, maintaining or No
strengthening the relationship with the local economy.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business Yes
opportunities with this company.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
247,000
247,000 The Company is holding the shares of this company brandSeibu Holdings Inc.

443

Mitsubishi UFJ
Financial Group,
Inc.

Previous fiscal year

113,600

113,600

410

212

42,00042,000397

326

90,00090,000382

356

McDonald's
Corporation

14,084

14,084301

274

YONDOSHIHOLDINGS INC.

103,400

103,400264

226

175,707

175,091257

196

116,800

116,800240

247

118,261

118,261

232

225

100,911

100,646

228

216

58,37958,379Fujio Food System
Co., Ltd.
West Japan Railway
Company
Mitsubishi Heavy
Industries, Ltd.

OKUWA Co., Ltd.

AEON KYUSHUCO., LTD.
PLENUS Co., Ltd.

AEON CO., LTD.

Axial Retailing Inc.

No

Whether thecounterparty
Purposeandquantitative
effectofholdingtheshares,andNumber of shares
Number of sharescompany isreason 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
716,420
716,420brand for the purpose of building, maintaining or No
strengthening the relationship with the company brand as (Note 2)425
385 an important business partner.
Current fiscal year

Brand

for the purpose of creating new beverage business473 opportunities with this company.

222

213

Nishikawa RubberCo., Ltd.

99,44599,445

187

189

Kansai Super
Market Ltd.

113,200

113,200

119

113

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 or No
strengthening the relationship with the company brand as (Note 2)
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
Nobrand for the purpose of building, maintaining or(Note 2)
strengthening the relationship with 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.
No
The Company increased the number of shares of thiscompany by purchasing through suppliers’ shareownership association of 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 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 by purchasing through suppliers’ shareownership association of 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 or Yes
strengthening the relationship with the local economy.
The Company is holding the shares of this company
brand for the purpose of creating new beverage business No
opportunities with this company.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
Whether thecounterparty
Purpose and quantitative effect of holding the shares, andNumber of shares
Number of sharescompany isCompany namereason 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 has been holding the shares of this
169,000
169,000 company brand for the purpose of building, maintaining
or strengthening the relationship with this company as an
The Iyo Bank, Ltd.
important business partner.
No
Since the Company sold all of these shares in 2020, there
105
98 were no shares held as of the date the securities report
was filed.
The Company has been holding the shares of this
23,44723,447 company brand for the purpose of building, maintaining
or strengthening the relationship with this company as an
Sumitomo MitsuiNoimportant business partner.
Trust Holdings, Inc.
(Note 2)Since the Company sold all of these shares in 2020, there
102
94 were no shares held as of the date the securities report
was filed.
The Company has been holding the shares of this
98,01598,015 company brand for the purpose of creating new beverage
Isetan Mitsukoshi
business opportunities with this company.
No
Holdings Ltd.
Since the Company sold all of these shares in 2020, there96
119 were no shares held as of the date the securities report
was filed.
24,00024,000 The Company is holding the shares of this company
Amiyaki Tei Co.,brand for the purpose of creating new beverage business No
Ltd.
90
89 opportunities with this company.
The Company is holding the shares of this company
71,406
67,112 brand for the purpose of creating new beverage business
H2O RETAILIG
opportunities with this company.
No
Corporation
The Company increased the number of shares of this88
105 company by purchasing through suppliers’ shareownership association of this company
The Company is holding the shares of this company
37,972
37,972
The Hyakujushibrand for the purpose of building, maintaining orNo
Bank, Limited
strengthening the relationship with the company brand as
82
99
an important business partner.
48,10048,100 The Company is holding the shares of this company
DAISYObrand for the purpose of creating new beverage business No
CORPORATION
81
74 opportunities with this company.
Current fiscal year

Previous fiscal year

32,40032,40078

59

26,15525,42576

46

129,780

127,973

69

68

Mammy Mart
Corporation

37,32037,32068

71

Valor Holdings Co.,Ltd.

31,20031,200

67

83

Torikizoku co., ltd.

Yoshinoya holdings
Co., Ltd.

POPLAR. CO.,LTD.

Company nameCurrent fiscal year

Previous fiscal year

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 by purchasing through suppliers’ shareownership association of 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 by purchasing through suppliers’ shareownership association of 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 No
opportunities with this company.

Purpose and quantitative effect of holding the shares, and Whether the55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.
Number of shares

Number of shares

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

29,854

29,1656352

16,000

8,000

60

26

10,80010,80051

39

60,00060,00050

52

17,831

17,64050

48

49,397

48,68444

54

16,58316,027

43

36

YAMAZAWA CO.,LTD.

24,10024,10041

42

Daiichi Kotsu
Sangyo Co., Ltd.

44,00044,00039

29

31,45230,15939

34

19,88618,98736

36

MINISTOP CO.,LTD.

23,57023,57035

49

GREENLANDRESORT Co., Ltd.

64,20064,2003430

COLOWIDE Co.,Ltd.

14,238

14,23832

33

Keikyu Corporation

KOBE BUSSAN
Co., Ltd.

Hankyu Hanshin
Holdings, Inc.

Rengo Co., Ltd.

Bronco Billy Co.,Ltd.

RETAILPARTNERS CO.,
LTD.

LIFE
CORPORATIONASAHI KASEICorporation

Misumi Co., Ltd.

reason for increasing the number of shares(Note 1)counterparty
company isholding theCompany’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.
No
The Company increased the number of shares of thiscompany by purchasing through suppliers’ shareownership association of 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 due to stock split.
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 orYes
strengthening the relationship with the company brand as
an important business partner.
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 by purchasing through suppliers’ shareownership association of 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 by purchasing through suppliers’ shareownership association of 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 by purchasing through suppliers’ shareownership association of 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 Yes
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 by purchasing through suppliers’ shareownership association of 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 by purchasing through suppliers’ shareownership association of 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 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.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
Whether thecounterparty
Purpose and quantitative effect of holding the shares, andNumber of shares
Number of sharescompany isreason 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
Current fiscal year
Company name

United Super
Market Holdings
Inc.

Previous fiscal year

32,78032,780

32

39

7,239

7,069

31

24

10,160

9,915

30

44

16,00016,00030

2713,882

13,88229

31

18,70018,70025

29-502,000

-

1,644

-

27,209-378-

97,460-246-

72,500-60

Matsumotokiyoshi
Holdings Co., Ltd.

GENKI SUSHI
CO., LTD.

WDI Corporation.

Fukuoka Financial
Group, Inc.

Nihon Yamamura
Glass Co., Ltd.

RICOH LEASING
Co., Ltd.

FamilyMart Co.,Ltd.

Toyo Seikan Group
Holdings, Ltd.

Mitsubishi
Chemical Holdings
Corporation

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 by purchasing through suppliers’ shareownership association of 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 by purchasing through suppliers’ shareownership association of 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 or No
strengthening the relationship with this company and the (Note 2)
local economy.
The Company is holding the shares of this company
brand for the purpose of building, maintaining orNostrengthening the relationship with the company brand as
an important business partner.
The Company has been holding the shares of thiscompany brand for the purpose of building, maintaining
and strengthening the relationship with the company Yes
brand as an important business partner, but sold all ofthese shares in 2019.
The Company has been holding the shares of thiscompany brand for the purpose of creating new beverageNobusiness opportunities with this company but sold all ofthese shares in 2019.
The Company has been holding the shares of thiscompany brand for the purpose of building, maintaining
and strengthening the relationship with the company Yes
brand as an important business partner, but sold all ofthese shares in 2019.
The Company has been holding the shares of thiscompany brand for the purpose of creating new beverageNobusiness opportunities with this company but sold all ofthese shares in 2019.

(Note) 1. The results of the assessment of the quantitative effect of holding the shares of individual company brands are omitted fromthis document for the purpose of maintaining confidentiality. The Company, however, is regularly verifying the effect ofholding 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 group company
is holding the Company’s shares.

57

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.
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 forthe 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 forthe purpose of pure investment during this fiscal year
No shares fall under this category.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.

V. Financial information
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, 2019 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.

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 the event 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, 2018)

Current fiscal year
(As of December 31, 2019)

AssetsCurrent assets
Cash and cash equivalents

8,32

65,510113,825

Trade and other receivables
Inventories

9,32
10

92,402
68,781

98,52874,120

Other financial assets
Other current assets

32
14

645
10,740752
17,587238,078

304,81211

435,305

467,136

11,18
12

88,88039,62927,021

12

66,53967,123

298

310

32
19

34,79638

33,499
－

29

6,264

6,093

14

7,274

6,820

639,394

647,632

877,472

952,444

Total current assets
Non-current assets
Property, plant and equipment
Right-of-use assets
Goodwill
Intangible assets
Investments accounted for using the equity
methodOther financial assets
Defined benefit asset
Deferred tax assets
Other non-current assets
Total non-current assets
Total assets

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 the event 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, 2018)

Current fiscal year
(As of December 31, 2019)

Liabilities and equity
Liabilities
Current liabilities:
Trade and other payables

15,32

105,701

122,364

Bonds and debts

17,32

45,512

17,261

Lease liabilities

18,32

-

6,634

Other financial liabilities

32

993
3,069

916
1,104

16
20

18
22,23020
19,886

177,524

168,186

17,32

56,401

188,487

18,32
32

749

34,138-Provisions

19
16

33,712
2,191

24,9082,104

Deferred tax liabilities

29

23,082

24,876

Other non-current liabilities

20

2,907

3,254

119,042

277,767

296,566445,953

Income taxes payable
Provisions
Other current liabilities
Total current liabilities
Non-current liabilities:
Bonds and debts
Lease liabilities
Other financial liabilities
Net defined benefit liabilities

Total non-current liabilities
Total liabilities
EquityCapital stock21

15,232

15,232

Capital surplus
Retained earnings

21
21

450,526
121,372

Treasury stock
Accumulated other comprehensive income

21
21

450,533
182,418(72,651)

Equity attributable to owners of the parent
Non-controlling interests
Total equity
Total liabilities and equity

61

4,915

(85,649)
4,517

580,448505,999458

492

580,906

506,491

877,472

952,444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.
②【Consolidated statements of profit or loss】(Millions of yen)
Notes
Net sales

Previous fiscal year
(From January 1, 2018
to December 31, 2018)

7,24

Current fiscal year
(From January 1, 2019
to December 31, 2019)927,307914,783

475,156

473,72325

452,151
426,195

441,060
423,685

Other income

13
27

2,116

61,859
4,127

Other expenses

27

13,385

15,076(5)

43

14,682(55,389)

Cost of sales
Gross profit
Selling and general administrative expenses
Impairment losses of goodwill

Share of income (loss) of entities accounted forusing equity method
Operating income (loss)
Financial revenue
Finance costs

28
28

830
745

1,145
1,175

Income (loss) for the year before income taxes
Income tax expense

29

14,767
4,605(55,419)
2,476

Net income (loss) for the year

10,162(57,895)

Net income (loss) for the year attributable to
Owners of parent

10,117(57,952)

45

56

52.68

(322.22)

Non-controlling interests

Earnings (loss) per share (yen)3662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.
③ 【Consolidated statements of comprehensive income】(Millions of yen)
Notes

Previous fiscal year
(From January 1, 2018
to December 31, 2018)

Net income (loss) for the year
Other comprehensive income.

Current fiscal year
(From January 1, 2019
to December 31, 2019)

10,162(57,895)(2,889)5,596

30

Items that will not be reclassified subsequently toincome or loss:
Remeasurements of defined benefit plans
Share of other comprehensive income of equity
method investees(4)

Net change in financial assets measured at fairvalue through other comprehensive income(3,344)

Subtotal(6,236)

6,221

Foreign currency translation adjustments offoreign operations

(12)

-

Cash flow hedges

(716)

(434)

(728)

(434)

4
621

Items that may be reclassified subsequently toincome or loss:

Subtotal
Total other comprehensive income (loss) for theyear(6,965)

Total comprehensive income (loss) for the year

3,197

(52,108)

3,152
45(52,164)
56

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

63

5,788

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.
④ 【Consolidation statements of changes in equity】
For the year ended December 31, 2018
(Millions of yen)
Equity attributable to owners of the parent company
Other
Comprehensive
NonShareRetained Treasury
incomecontrolling
Capital stock premium
earnings
Shares
Accumulated
Totalinterests
Total
Balance as of January 1, 201815,232450,498
184,317(4,693)
9,258
654,611427
655,038
Comprehensive income forthe year
Net income (loss) for the－－
10,117－－
10,11745
10,162
year
Other comprehensive
－
－
－
－
－
(6,965)(6,965)(6,965)income (loss)
Total comprehensive income－－
10,117－(6,965)
3,152
45
3,197
(loss) for the year
Transactions with owners,
etc.
－
－
－
－
Dividends of surplus
23(9,173)(9,173)(21)(9,194)Purchase of treasury stock 21－(25)－(67,961)－(67,987)－(67,987)
Disposal of treasury stock 21
－
1
－
4
－
4
－
4
Transactions of share22
－
67
－
－
－
67
－
67
based payment
Reclassification fromaccumulated othercomprehensive income toretained earnings
Reclassification fromaccumulated othercomprehensive income tonon-financial assets
Other changes
Total transactions withowners etc.
Balance as of December 31,
2018

21

－

－

(2,843)

－

2,843

－

－

－

21

－

－

－

－

(221)

(221)

－

(221)

－

(7)

－

－

－

(7)

7

－

－

36

(12,016)(67,958)

2,622(77,316)(14)(77,329)

15,232450,533

182,418(72,651)

4,915

580,448458

580,90664

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.
For the year ended December 31, 2019
(Millions of yen)
Equity attributable to owners of the parent company
Othercomprehensive
NonShareRetained
Treasury
incomecontrolling
Capital stock premium
earnings
sharesaccumulated
Totalinterests
Total
Balance as of January 1, 201915,232450,533
182,418
4,915
580,448458
580,906(72,651)(Before restatement)
Adjustments resulting from
－
－
(338)
－
－
(338)
－
(338)
the adoption of IFRS 16
Balance as of January 1, 201915,232450,533
182,080
4,915
580,110458
580,568(72,651)(After restatement)
Comprehensive income forthe year
Net income (loss) for the
56－－(57,952)－－(57,952)(57,895)
year
Other comprehensive
5,788
5,788
5,788
－
－
－
－
－
income (loss)
Total comprehensive income
5,788
56
－
－
(57,952)－(52,164)(52,108)(loss) for the year
Transactions with owners,
etc.
Dividends of surplus
23－－(9,071)－－(9,071)(22)(9,093)Purchase of treasury stock

21

－

(64)

－

(13,002)－(13,066)－(13,066)

Disposal of treasury stock
Transactions of sharebased payment

21

－

(1)

－

3

－

3

－

3

22

－

57

－

－

－

57

－

57

21

－

－

6,315

－

(6,315)

－

－

－

－

－

－

－

129

129

－

129

－

(7)

(2,756)(12,999)(6,186)(21,947)(22)(21,970)

15,232450,526

121,372(85,649)4,517

505,999492

506,491

Reclassification fromaccumulated othercomprehensive income toretained earnings

Reclassification fromaccumulated other21
comprehensive income tonon-financial assets
Total transactions withowners, etc.
Balance as of December 31,
2019

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
⑤ 【Consolidated statements of cash flows】(Millions of yen)
For the year ended
December 31, 2019

For the year ended
December 31, 2018
Cash flows from operating activities
Income (loss) for the year before income taxes
Adjustments for:
Depreciation and amortization
Impairment loss
Change in allowance for doubtful accounts
Interest and dividends income
Interest expenses
Share of loss (income) of entities accounted for using
equity method
Gain on sale of property, plant and equipment
Loss on disposal and sale of property, plant and equipment
Increase in trade and other receivables
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
Others, net
SubtotalInterest received
Dividends received
Interest paid
Income taxes paid
Income taxes refund
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
Purchases of other financial assets
Proceeds from sale of other financial assets
Proceeds from sales of shares of subsidiaries resulting inchange in scope of consolidation
Others, net
Net cash used in investing activities

66

13

11

14,767(55,419)

47,531
202
255
(516)
612

56,95162,870
(515)
(509)
1,175

5

(43)

(215)
9,399
(4,355)(6,869)
393
2,234
491
1,148
501
65,5793
487(548)(14,553)275
51,244(2,183)2,513(6,149)(5,339)
(266)
6,259
(213)
(3,543)(451)
55,1381508(1,018)(13,675)
1,675
42,629(49,752)(78,213)

658

7,621

(137)
273

(58)
2,255

406

－

(75)
(48,628)(68,308)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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
(Millions of yen)
For the year ended
December 31, 2018
Cash flows from financing activities
Increase (decrease) in short-term loans payable
Repayments of long-term loans payable
Proceeds from issuance of bonds
Bond redemption
Dividends paid
Dividends paid to non-controlling interests
Proceeds from disposal of treasury stock
Purchases of treasury stock
Repayments of lease liabilities
Others, net
Net cash (used in) provided by financing activities
Net foreign exchange differences on cash and cash
equivalents
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 year

31
31
31
31
23

32
31

8

67

For the year ended
December 31, 201924,000(1,817)－－(9,173)(21)
4(67,998)－(830)(55,835)(24,000)(1,686)
149,441(20,000)(9,071)(22)
3(13,095)(7,576)－73,994(12)－(53,231)
118,742
65,51048,31565,510113,825

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.
【Notes to consolidated financial statements】
1. Introduction
The Company is a holding company domiciled in Japan and is listed on the First Section of the Tokyo Stock Exchange
and the Fukuoka 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, mineral water and other soft drinks in Japan. The Group also develops, manufactures andsells a variety of healthcare products. Between 1999 and 2017, we have integrated our operations with five Coca-Colabottlers, 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 awholly-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 aholding 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 27, 2020 and areconsidering the events after the reporting period to that date (see notes 38, "events after the reporting period").

68

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.
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.
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 of69

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.
control 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 functional currency of each company at the exchange rate of thetransaction 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
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.
(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) 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

2 - 204-970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.
Depreciation 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.
(8) 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 its 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.
(9) 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.
(10) 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
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
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.
(11) Impairments of property, plant and equipment, intangible asset, goodwill and Right-of-use asset
The Group performs impairment tests for goodwill and intangible asset with indefinite useful life goodwill annually or
when for events or changes in circumstances that may indicate a potential impairment. Other non-monetary assets aretested 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.
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."(12) 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.
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
(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.
(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;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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
・ 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
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 is 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.
(13) 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.
(14) 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 can
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
be 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 calculatedby 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.
(15) 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 that75

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 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 is 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.
(16) 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”.
(17) Dividends
Dividends to the Company’s owners is recognized as a liability of the period in which is approved by the Company’sowners.
(18) 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.
(19) Government grants
Government grants is measured at fair value when there is reasonable assurance that the conditions attaching to them
are met and the grants will be received. Government grants related to income is recognized in profit or loss on a systematic
basis over the periods in which the related costs that are intended to be compensated by the grant are recognized as
expenses. Government grants related to asset is reduced directly when calculating the carrying amount for the asset.
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
Grants are recognized in profit or loss as a reduction of depreciation expense over the useful life of the applicabledepreciation asset.
(20) 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 the event 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. Accounting estimates are based on 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 and consolidated statements ofcomprehensive 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(7)"Property, plant and equipment."
The right-of-use asset is estimated for the lease term with a non-cancellable priod 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(10)“Lease”.
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(9) "Intangible assets."(b) Impairment test of non-financial assets, including property, plant and equipment, goodwill and intangible asset
Recoverable amounts are calculated based on assumptions using factors such as asset's useful life, future cash flows,
discount rates and long-term average growth rates. While such assumptions are based on management's best estimatesand judgments, these assumptions may also be affected by changes in economic conditions that have a significant impact
on future consolidated financial statements. Details of cash-generating unit's and recoverable amount's decisions areprovided in notes 3(8) "Goodwill", (11) "Impairments of property, plant and equipment, intangible asset, goodwill andlease asset" and notes 13 "Impairment of non-financial assets."(c) Provision and contingent liabilities
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(13)"Provision and contingent
liabilities" and notes 16 "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 business plans. Such estimates could be impacted by the Group's future operating results. Further information
regarding the recoverability of deferred tax assets is provided in notes 3(15), "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 in78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.
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
19 “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 32, "Financial instruments (7) Fair value offinancial instruments."(g) Business Combinations
The Group accounts for business combination using the acquisition method and measures the acquisition assets andunderwriting liabilities including the individually identifiable intangible assets, at the fair value of acquisition date. The
allocation of the acquisition price to the fair value of the acquisition assets and the underwriting liabilities will require
the valuation of future cash flows related to the individual asset and liability and the appropriate discount rate for theacquisition date. Depending on the circumstances, the Group consults with outside experts in making fair value decisions.
The value of unobservable markets is determined by fair value using generally accepted valuation techniques.
5. Changes in accounting policies
The Group has implemented the standards and interpretation that have been compulsorily applied since the current fiscal
year. These standards and interpretations are as follows:
Establishment or amendment of statements andSummary of requirementsinterpretations
New standard for leases, replacing IAS 17, requires all leases to be shown on
IFRS 16 Leases(published January 2016)

the statements of financial position as if they were financed purchases. The
new standard sets out the principles for the recognition, measurement,
presentation and disclosures of leases.

The impact of the application of IFRS 16 is as follows. There is no significant impact of this change in accounting policy
on earnings per share. The Group retrospectively applied IFRS 16 according to transitional measures, the cumulative effectof the commencement of application is recognized as an adjustment to the opening balance of retained earnings in thecurrent consolidated fiscal year. In the transition to IFRS 16, the practical expedient of IFRS 16.C3 was selected as towhether an arrangement contains a lease or not, it takes over the judgment of IAS 17 “Leases” and IFRIC 4 “Determining
whether an Arrangement contains a Lease”.
IFRS 16 requires that lessee's lease not be classified as finance lease or operating lease, but rather as a single accounting
model and, in principle, recognize the right-of-use asset representing the right to use the underlying asset and the leaseliability representing the obligation to pay the lease payments for all leases. However, for short-term leases or leases forwhich the underlying asset is of low value, the Group may elect not to apply the requirements of this standard. After
recognizing right-of-use asset and lease liability, right-of-use asset depreciation and interest expense related to lease liability
are recognized.
In the Group, the lease term of the right-of-use assets is estimated by adding a reasonably reliable period in which the option
to extend the lease is not exercised or the option to cancel the lease is not exercised. In addition, the discount rate applied
to the lease liabilities for the right-of-use assets uses the lessee's incremental borrowing rate, and the weighted average ismainly 1.0%. Right-of-use assets are depreciated using the straight-line method mainly over 15 years from the start date.
As of the end of the previous consolidated fiscal year, finance lease liabilities that were recognized by applying IAS 17 were
901 million yen.
Of 7,644 million yen (before discount) of the operating lease contracts disclosed by applying this standard, 549 million yen(before discount) is accounted for as a small-value asset lease, in addition, there is a 37,409 million yen increase in leaseliabilities over a period in which it is reasonably certain that the extension option will be exercised.
As a result, in the consolidated statement of financial position at the beginning of the current consolidated fiscal year underreview, right-of-use assets increased by 44,034 million yen, deferred tax assets increased by 15,200 million yen, lease79

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.
liabilities increased by 44,505 million yen, deferred tax liabilities increased by 15,028 million yen and long-term accounts
payable increased by 40 million yen, retained earnings decreased by 338 million yen. Deferred tax assets and Deferred tax
liabilities are offset on the consolidated balance sheets based on IAS 12 “Income taxes”.
In addition, cash flow from operating activities increased by 7,000 million yen and cash flows from financing activities
decreased by 7,000 million yen in condensed quarterly consolidated cash flows for the year.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
6. Business Combinations
For the year ended December 31, 2018
This information is omitted because it is immaterial.
For the year ended December 31, 2019
Not applicable.
7. Business segments(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. The Group has established an organizational management system for each product and service. Based on
the types and characteristics of products and sales markets, the Group identified the following operating segments. No
operating segments have been aggregated to form reportable segments.
The principal products and services belonging to the reportable segments are as follows, and the Healthcare andSkincare segment is operated by a wholly owned subsidiary, Q'SAI CO., LTD. and its subsidiaries.
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, etc., vending machine-related business in Japan
Manufacture and sell of kale juice (aojiru) and other products made from Kale, as

Healthcare & Skincare businesswell as the manufacture and sale of health foods, cosmetics and other related
products

The 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."
Reportable segment information is as follows:
For the year ended December 31, 2018
(Millions of yen)
Reportable segments
Beveragebusiness

Healthcare& Skincare
business

Total ofreportablesegments

Revenue to external customer
Revenue from inter-segment sales

899,863-

27,444-927,307－-927,307－

Total revenue
Segment profit

899,8638,864

27,444
5,818

927,307
14,682-

927,307
14,682Adjustments

Total

Adjustments:
Financial income

830

Finance expense

745

Profit before income tax

14,767

Other items:
Depreciation and amortization
Impairment losses

47,149202

381-

47,531
202-

47,531
202

Share of loss of equity method
investees

(5)

-

(5)

-

(5)

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
For the year ended December 31, 2019

Sales revenue to external customer
Intersegment sales revenue
Sales revenue
Segment income (loss)
Adjustments
Financial revenue
Finance costs
loss before tax
Other items
Depreciation and amortization
Impairment losses of goodwill
Impairment loss
Equity-method gains

Reportable segments
Healthcare &Beverage
SkincareBusiness
Business
890,009
24,774－－890,009
24,774
3,515(58,904)(Millions of yen)
Reportablesegments
Total
914,783－
914,783(55,389)

Adjustments
－
－
－
－

Total
914,783－
914,783(55,389)
1,145
1,175
(55,419)

56,40861,859
1,011
43

543
－
－
－

56,951
61,859
1,011
43

－
－
－
－

56,951
61,8591,01143(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.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
8. Cash and cash equivalents
The breakdown of cash and cash equivalents is as follows:
Previous fiscal year
(As of December 31, 2018)(Millions of yen)
Current fiscal year
(As of December 31, 2019)

65,510113,825

65,510113,825

Cash and demand deposits
Total

The balance of "cash and cash equivalents" in the consolidated statements of financial position for the previous fiscal year and thecurrent fiscal year coincides with the balance of "Cash and cash equivalents" in the consolidated statements of cash flows.
9. Trade and other receivables
Trade and other receivables consisted of the following:
Previous fiscal year
(As of December 31, 201)

(Millions of yen)
Current fiscal year
(As of December 31, 2019)

Accounts and notes receivable
Accounts receivable - other

69,93422,707

77,62021,174

Other receivables
Allowance for credit losses

3
(242)

(265)

92,402

98,528Total

10. Inventories
The breakdown of inventories is as follows:(Millions of yen)Previous fiscal year
(As of December 31, 2018)

Current fiscal year
(As of December 31, 2019)

Raw material
Work-in-progress

4,683
296

5,121
530

Merchandise and finished products
Supplies

59,894
3,908

63,866
4,604

68,781

74,120Total

The amount of inventory recorded in "Cost of sales" for the previous fiscal year and the current fiscal year was 475,024
million yen and 473,309 million yen, respectively. Of this amount, the amount of write-down of inventory assets in theprevious fiscal year and the current fiscal year was 720 million yen and 341 million yen, respectively.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
11. 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
Buildings
andstructures
Balance at January 1, 2018
Acquisition

Right-ofuse assets

Total

MachineryandvehiclesVending
machineLand

Constructionin progress

185,284
9,218(56)

202,948
25,230155,005
2,103

592
6,085

Sale of subsidiary

157,799
6,896
(37)

-

701,627
49,533
(93)

-

-

-

Disposal and sale

(5,676)(24,265)(8,299)

(354)

(1)

(38,596)-

Transfer fromconstruction inprogress

74

268

0

-

(343)

-

-

Other

(47)

33

20

-

(106)

(100)

-

159,010

170,482

219,899

156,753

6,228

712,371

-

-

-

-

-

-

-

56,544

159,010

170,482

219,899

156,753

6,228

712,371

56,544

Acquisition

9,569

25,691

25,846420

22,98884,513

14,656

Disposal and saleTransfer fromconstruction inprogress(2,560)(4,488)(8,997)(4,558)(73)(20,675)(8,277)

3,054

4,927

-

-

(7,981)

-

-

(36)

216

(5)

(83)

1,029

1,121

(7,269)169,037

196,828

236,743

152,532

22,190777,330

55,655

Balance at December 31,
2018
Adjustments resulting
from the adoption of
IFRS 16
Balance at January 1, 2019
(After restatement)

Other
Balance at December 31,
2019

The main acquisition for construction in progress during the current fiscal year was the construction of a new line andwarehouse at the Hiroshima Plant.

85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.
Accumulated depreciation and impairment losses
Property, Plant and Equipment
Buildings
andstructures
Balance at January 1, 2018
Depreciation.

Right-ofuse assets

Total

MachineryandvehiclesVending
machineLand(74,656)(102,223)(82,370)(3,320)-(262,569)-

Constructionin progress(6,320)(13,098)(24,402)--(43,821)-

Impairment losses

(0)

(197)

-

(4)

-

(202)

-

Sale of subsidiary
Disposal and sale

33

56

-

89

-

3,979

18,341

7,239

-

-

29,559

-

2

(121)

(5)

-

-

(124)

-

(76,962)(97,242)(99,538)(3,324)-(277,066)

-

-

-

-

-

-

-

(12,511)(76,962)(97,242)(99,538)(3,324)-(277,066)(12,511)(6,525)(13,730)(26,060)--(46,316)(7,156)

-

(407)

Other
Balance at December 31,
2018
Adjustments resulting
from the adoption of
IFRS 16
Balance at January 1, 2019
(After restatement)
Depreciation.

--

Impairment losses

(72)

(125)

Disposal and sale

1,099

3,898

7,824

173

-

12,993

1,650

74

(253)

37

941

-

799

1,991

(82,387)(107,453)(117,736)(2,618)-(310,194)(16,026)

Other
Balance at December 31,
2019

-

(605)

-

Carrying amount(Millions of yen)
Property, Plant and Equipment
Right-ofuse assets

Total

Buildings
andstructures

MachineryandvehiclesVending
machineLand

December 31, 201882,04773,240120,361

153,4296,228

435,305－

December 31, 201986,65089,375

119,006

149,915

22,190467,136

39,629Constructionin progress

The carrying amounts of property, plant and equipment presented above include following leased assets under thefinancing lease contract:(Millions of yen)
Property, Plant and Equipment

December 31, 2018

Total

Buildings
andstructures

MachineryandvehiclesVending
machine

55

790

55

Land
－

Constructionin progress－

900

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.
The amount of property, plant and equipment pledged as collateral for loans payable is set forth in Note 17, “Bonds andloans payable”.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
12. 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)
Intangible
assets withindefinite
useful lives
Contract
relatedintangible
asset

Goodwill

Balance at January 1, 2018
Acquisition

Intangible assets with finite useful
lives
Intangible
asset totals
SoftwareOther

103,359-

52,050-25,852
3,442

685
2

78,587
3,444

Increase due to internal development
Disposal and sale

-

-

159
(4,332)-

159(4,332)

Other

-

-

56

-

56

Balance at December 31, 2018

103,359

52,05025,176687

77,914

Acquisition
Disposal and sale

-

-

4,711
(8,175)

1
(5)

4,712
(8,180)

Other

-

-

(170)

69

(101)

103,359

52,05021,542753

74,345

Balance at December 31, 201987

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.
Accumulated amortization and impairment losses(Millions of yen)
Intangible
assets withindefinite
useful lives
Contract
relatedintangible
asset

Goodwill

Balance at January 1, 2018

Intangible assets with finite useful
lives
Intangible
asset totals
SoftwareOther(14,479)-(11,048)(154)(11,201)--(3,623)
3,546

(101)
-

(3,724)
3,546

Depreciation
Disposal and sale
Other

-

-

5

-

5

(14,479)-(11,120)(254)(11,374)

Depreciation
Impairment losses(61,859)-(3,381)
(406)

(98)
-

(3,480)(406)

Disposal and sale
Other

-

0

7,885
217

5
(69)

7,890
148

(76,338)-(6,805)(417)(7,222)

Balance at December 31, 2018

Balance at December 31, 2019
Carrying amount(Millions of yen)

Goodwill

December 31, 2018
December 31, 2019

Intangible
assets withindefinite
useful lives
Contract
relatedintangible
asset

88,88027,02152,05052,050Intangible assets with finite useful
lives
Intangible
asset totals
Software
14,056
14,737

Other
433
336

66,53967,123

Software at the end of the previous fiscal year and the end of the current fiscal year includes internally generated
intangible assets of 774 million yen and 688 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. The carrying amount of the
goodwill was 61,170 million yen at both ends of the years ended December 2018 and 2017. An impairment loss on goodwill
was recorded for the current consolidated fiscal year, as described in Note 13 “Impairment of non-financial assets”.
Details of the contract related intangible assets are included in Note 3 (9) "Intangible assets".

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
13. 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.
For the year ended December 31, 2018
(Millions of yen)
Reportable segments
Healthcare & Skincare
business

Beverage business

Total

Property, plant and equipment
Buildings and structures

0

-

0

Machinery and vehicles
Land

197
4

-

197
4

Subtotal

202

-

202

-

-

-

-

-

-

202

-

202

Goodwill
Intangible assets
Software
Total

Impairment losses of 202 million yen were recognized for property, plant and equipment, goodwill, and intangible
assets related to the Beverage Business mainly at sites subject to the elimination of the expected future use.
For the year ended December 31, 2019
(Millions of yen)
Reportable segments
Beverage business

Healthcare & Skincare
business

Property, plant and equipment
Buildings and structures

72

－

72

Machinery and vehicles
Land

125
407

－
－

125
407

Subtotal

605
61,859－－605
61,859

406

－

406

62,870－62,870Goodwill
Intangible assets
Software
Total

Total

Impairment losses on goodwill occurred in Beverage Business during the current consolidated fiscal year. The earnings
forecast based on the mid-term plan up to 2024 announced in August 2019 is expected to be lower than the businessplan expected at the time of acquisition of Coca-Cola Bottlers Japan Inc. (formerly Coca-Cola East Japan Co., Ltd.)As a result, based on the mid-term plan, we assessed the recoverable value of the cash-generating unit group to which
the brick belongs. As a result, the Company recorded an impairment loss of goodwill of 61,859 million yen in thecurrent consolidated second quarter.
The recoverable amount is calculated based on its value in use. Value in use is mainly estimated by discounting theestimated cash flows to its present value. The estimated cash flows in calculated using the mid-term plan, the estimatedcash flows after the period of the mid-term plan is calculated using cash flows by considering the long-term average
growth rate of the market.
Certain key assumptions used in the estimation of the recoverable amount are the discount rate and growth rate. The
amounts based on these assumptions reflect management’s assessment of future trends in the relevant industries and89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.
have been based on historical data from both external and internal sources. The discount rate before tax and growthrate used in the calculation of the value were 5.4% and 0.5%, respectively. For property, plant and equipment andintangible assets related to the beverage business, an impairment loss of 1,011 million has been recognized mainly on
the assets whose use is no longer expected.
(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 goodwill and intangible asset with indefinite useful lives allocated to cash-generating unit or
cash-generating unit group are as follows:(Millions of yen)Cash-generating
unit or cashgenerating unit
group

Reportable segments

Goodwill

Current fiscal year
(As of December
31, 2019)

Beverage business

Beverage

61,859-Healthcare & Skincare
business

Health food

27,021

27,021

88,88027,02152,05052,05052,05052,050

Total
Intangible assets withindefinite useful lives

Previous fiscal year
(As of December
31, 2018)

Beverage business(Contract related
intangible asset)

Beverage

Total

The recoverable amount of cash-generating unit or cash-generating unit group to which goodwill and intangible assets
with indefinite useful lives has been allocated is calculated based on its value in use. Value in use is mainly estimated bydiscounting the estimated cash flows to its present value. The estimated cash flows in calculated using the financial budget
within five years, based on internal budget which reflects past experience and external information. The estimated cash
flows after the period of the financial budget is calculated using cash flows by considering the long-term average growthrate of the market.
Certain key assumptions used in the estimation of the recoverable amount are the discount rate and growth rate. The
amounts based on these assumptions reflect management’s assessment of future trends in the relevant industries and havebeen based on historical data from both external and internal sources.
The pre-tax discount rates and growth rates used to calculate the value in use of the cash-generating unit or cashgenerating unit group to which goodwill and intangible assets with indefinite useful lives were allocated are as follows:
Cash-generating unit or cashgenerating unit group

Previous fiscal year
(As of December 31, 2018)
Discount rate

Growth rate

Current fiscal year
(As of December 31, 2019)
Discount rate

Growth rate

7.3％
0.5％
5.1％
0.5％
Beverage
12.2％
0.5％
9.8％
0.5％
Health food
(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
were determined based on the long-term average growth rates of the markets consistent with the assumptions assumed
to be used by the market participants.
(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.
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
For Beverage, the recoverable amount exceeded the book value of 70,726 million yet in the current fiscal year. However,if the discount rate is greater than 5.6% or the growth rate is less than (0.1%), an impairment loss may occur.
For Heath food, the recoverable value is sufficiently higher than the book value even if the discount rate or growth rateused to calculate the recoverable value fluctuates within a reasonable range, a significant loss is unlikely to occur.

Cash-generating unit or cashgenerating unit groups

Previous fiscal year
(As of December 31, 2018)
Discount rate

Current fiscal year
(As of December 31, 2019)

Growth rate

Discount rate

Beverage

8.0%(0.3%)

5.6%

Health food

23.6%

(15.9%)

14.0%

Growth rate
(0.1%)(5.7%)

14. 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, 2018)

Current fiscal year
(As of December 31, 2019)

8,897
1,063

8,363
7,640

Consumption tax receivable
Other

611
169

1,557
27

Total

10,74017,587Long-term prepaid expenses
Other

7,221
52

6,760
60

Total

7,274

6,820

Current
Prepaid expense
Income tax receivable

Non-current

15. Trade and other payables
Trade and other payables consisted of the following:(Millions of yen)Previous fiscal year
(As of December 31, 2018)

Current fiscal year
(As of December 31, 2019)

Trade payables
Accounts payable - other41,12560,36444,75973,337

Accrued expenses

4,212

4,268

105,701

122,364

Total

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
16. Provisions
Changes in provision were as follows:(Millions of yen)
Asset retirement
obligations

Environmental
measuresprovision

2,103

106

2,209

42

7

50

(77)

(64)

(141)

7

-

7

2,076

49

2,125

20
2,055

49

20
2,104

2,076

49

2,125

Balance at December 31, 2018
Provision
Decrease during the fiscal year (intendeduse)
Increase due to passage of time and change
in discount rate
Balance at December 31, 2019
Current
Non-current
Total

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.
17. Bonds and loans payable
Bonds and loans payable consisted of the following:(Millions of yen)

Current
Current portion of bonds

Previous fiscal year
(As of December 31,
2018)

Current fiscal year
(As of December
31, 2019)

Averageinterest
rate(%)

Maturity

19,974

15,9870.28-

Current portion of long-termloans payable

1,538

1,274

0.25

-

Short-term loans payable

24,000－－45,512

17,26145,907
10,494

179,415
9,072

Subtotal

56,401

188,487

Total

101,913205,748

Subtotal
Non-current
Bond
Long-term loans payable

0.25
0.15

2021 to 2029
2021 to 2026

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.

92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 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,
2018)

Current fiscal year
(As of December
31, 2018)

Interest rate
(%)

Colla
teral

The due
date forredemption

Dec 17,
2009

20,00019,974(19,974)

-

1.48

None

Dec
17,2019

Jun 17,2015

30,00029,93329,952

0.52

None

Jun
17, 2022

Dec 14,2015

16,00015,974

15,987(15,987)

0.28

None

Dec
14,2020

Coca-Cola
The
Company

west 2nd
Unsecuredbonds
Coca-Cola

The
Company

west 2nd
Unsecuredbonds
Coca-Cola

The
Company

East Japan
Co., Ltd.
2nd Unsecured
bonds

The
Company

1st unsecuredbond

Sep 19,2019

40,000-39,863

0.10

None

Sep
19,2024

The
Company

2nd unsecuredbond

Sep 19,2019

60,000-59,798

0.20

None

Sep
18,2026

The
Company

3rd unsecuredbond

Sep 19,2019

50,000-49,803

0.27

None

Sep
19,202965,881

195,402(15,987)

Total(19,974)(NOTE) 1. Figures in parentheses represent the redemption schedule within one year.
2. All interest rates are fixed rates.
The carrying amount of asset pledged as collateral for loans payable is as follows:(Millions of yen)Previous fiscal year
(As of December 31, 2018)

Current fiscal year
(As of December 31, 2019)

Property, plant and equipment
Buildings and structures

184-

Machinery and vehicles
Land

202

-

385

-

Total
The corresponding loans payable amounts are as follows:(Millions of yen)Previous fiscal year
(As of December 31, 2018)

Current fiscal year
(As of December 31, 2019)

Current portion of long-term loans payable18-

Long-term loans payable

148

-

166

-

Total

93

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.
18．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)
Current fiscal year
(As of December 31, 2019)
Depreciation of right-of-use assets
Buildings and structures

7,156

Land

－
Total

7,156

Interest expense on lease liabilities

453

Total cash outflows related to leases(7,576)The breakdown of the books of right-of-use assets is as follows.
(Millions of yen)
Current fiscal year
(As of December 31, 2019)
right-of-use assets
Buildings and structures

38,852

Land

777
Total

39,629The increase in right-of-use assets for the current consolidated fiscal year was 14,656 million yen.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
19. Retirement benefits
Regarding retirement benefit plans for employees of the Group, some subsidiaries are to adopt defined contribution
penion plans and defined beneift penion 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 busiess was unified into a defined
contriubition penion plan and a lump-sum retirment plan, and the conventional defined benefit plan was frozen.The frozen
defined benefit pension liability is calculated based on the retirement benfits determined at the time of the freeze and isrecognized as a defined benefit oblication until the employee is paid a penion or lump-sum payment upon future retirement..
Past service cost significantly increased in current 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, 2018
to December 31, 2018)
Balance at the beginning of the year
Service cost

Current fiscal year
(From January 1, 2019
to December 31, 2019)

146,359
3,600

142,599
4,103

867

772

Actuarial gains arising from changes indemographic assumptions

(688)

－

Actuarial gains arising from changes infinancial assumptions

(342)

(578)

921
(5)

971
(2,235)

Benefit payments
Other(8,100)(13)(14,115)(363)

Balance at the end of the year

142,599

131,154

Interest expense
Remeasurement:

Experience adjustment
Past service cost

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 11.6 years and 11.3 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, 2018
to December 31, 2018)
Balance at the beginning of the year

Current fiscal year
(From January 1, 2019
to December 31, 2019)

118,649

108,948

719

593

Return on plan asset
Contributions by employer(4,686)
1,501

8,919
390

Benefit payments
Other(7,208)(28)(12,138)(466)

Balance at the end of the year

108,948

106,246

Interest revenue
Remeasurement:95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.
(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, 2018
to December 31, 2018)
Balance at the beginning of the year

Current fiscal year
(From January 1, 2019
to December 31, 2019)

187

23

Remeasurement:
Effect of limiting the amount of net plan
assets to the amount of asset ceiling

(165)

Other
Balance at the end of the year

-

(23)

23

-

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, 2018)

Current fiscal year
(As of December 31, 2019)

Defined benefit plans obligations (funded)

129,401

117,343

Plan assets

108,948

106,246

Net deficit of funded defined benefit plans

20,453Adjustments due to asset ceiling
Subtotal
Defined benefit plans obligations (unfunded)
Total
Net defined benefit liabilities
Net defined benefit assets
Net defined benefit liabilities recognized in the
consolidated statements of financial position

96

23

11,097－

20,476
13,198

11,097
13,81033,67424,90833,712
38

24,908－33,67424,908

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.
(e) Major items of plan asset
The Group’s plan asset management aims to maximize the value of the plan assets over the medium-to-long term inorder to ensure that defined benefit plans beneficiaries receive future benefits within acceptable risks. The plan asset
diversifies its investments into a variety of domestic 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 basedon forecasts of returns, long-term risks, and past performance. The asset allocation targets are reviewed as appropriate
in the event of a significant change in the operational environment of the plan asset.
The major categories of plan asset are as follows:(Millions of yen)Previous fiscal year
(As of December 31, 2018)
With quoted
prices inactivemarketWithout
quoted inactivemarketCurrent fiscal year
(As of December 31, 2019)
Total

With quoted
prices inactivemarketWithout
quoted inactivemarket

Total

Equity instrument
Domestic
securities

-

9,417

9,417

-

9,767

9,767

Foreignsecurities-

21,414

21,414-24,48824,488

-

8,529

8,529

-

4,611

4,611

-

25,38425,384-23,30923,309-26,53826,538-26,716

26,716

Alternative
Other

245

17,224
197

17,224442

109

17,246－

17,246
109

Total

245

108,703108,948

109

106,137

106,246

Debt instrument
Domesticbonds
Foreign bonds
General account

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.
The estimated contribution to the plan asset for the following fiscal year is 231 million yen.
(f) Significant actuarial assumptions
Significant actuarial assumptions were as follows:
Previous fiscal year
(As of December 31, 2018)

Current fiscal year
(As of December 31, 2019)

0.63%
2.12%

0.69%
2.00%

Discount rate
Rate of salary increase

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 the event 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, 2018)
Increasing
Discount rate
0.25% decrease

Current fiscal year
(As of December 31, 2019)

Reduction

Increasing

Reduction

4,244

-

3,790

-

0.25% increase
Rate of salary increase

-

4,041

-

3,621

0.5% decrease
0.5% increase

227

214
-

75

70
-

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
11,176 million yen and 11,068 million yen, respectively.
20. 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, 2018)

Current fiscal year
(As of December 31, 2019)

5,936

5,353

Accrued paid leave
Consumption tax payable

5,939
2,620

5,413
1,289

Accrued bonuses
Other

5,521
2,215

5,436
2,395

22,23019,886

1,003
1,643

1,005
1,826

196
65

161
262

2,907

3,254

Current
Deposit received

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

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
21. 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, 2018
to December 31, 2018

Current fiscal year
(From January 1, 2019
to December 31, 2019

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

500,000

500,000

206,269-

206,269-

Decrease during the fiscal year
Outstanding at the end of the fiscal year--

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, 2018
to December 31, 2018
Number of treasury stock
Outstanding at the beginning of the fiscal year

Current fiscal year
(From January 1, 2019
to December 31, 2019

2,016

22,793

Increase during the fiscal year
Decrease during the fiscal year

20,779
(1)

4,125
(1)

Outstanding at the end of the fiscal year

22,793

26,917

The previous fiscal year and the current fiscal year, the increase was due to the acquisition of treasury stock through atender offer, the acquisition of treasury stock through market purchases and the purchase of shares less than one unit, andthe decrease was due to the purchase of shares less than one unit.

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 the event 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
income-Amount arising during the year
Changes in owners’ interest in
subsidiaries

Cash flow
hedgesForeigncurrencytranslationdifferencesof foreign
operations

Share ofothercomprehensi
ve income ofequitymethodinvestees

8,449

796

12

-

9,258

(2,889)(3,344)

(716)

(12)

(4)

(6,965)

2,889

(49)

-

-

4

2,843

-

-

(221)

-

-

(221)

Balance at December 31, 2018

-

5,056

(141)

-

-

4,915

Amount arising during the year

5,596

621

(434)

-

4

5,788

Reclassification from accumulated
other comprehensive income to(5,596)

(715)

-

-

(4)

(6,315)other comprehensive income tonon-financial asset

-

-

129

-

-

129

Balance at December 31, 2019

-

4,963

(445)

-

-

4,517

Balance at January 1, 2018
(After Restatement)

Reclassification from accumulated
other comprehensive income to

Total

retained earnings

retained earnings
Reclassification from accumulated

All amounts above are net of taxes.
22. 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 the Company’s ordinary shares (“the Company’s shares”) and cash pursuant
to the Performance Share Unit Plan (“PSU”) for the term of three consecutive fiscal years (from January 1, 2018 to
December 31, 2020, and from January 1, 2019 to December 31, 2021). 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 inthe mid to long term by sharing the merits and risks of stock price fluctuations with the shareholders.
The LTI offers the payment the Company's shares in a lump-sum based on the payment rate which is calculated within
the scope of 0% to 150% based on the method decided by the Company’s board of directors according to theachievement rates of ROE and sales growth during the three consecutive fiscal years.
(2) Number and fair value of shares granted during the year
The fair value on the grant date of this plan for the previous consolidated fiscal year and the current consolidated
fiscal year was 4,145yen and 2,726 yen. The fair value at the grant date is calculated by adjusting the market value of
the Company’s shares taking into account the expected dividends.
For the number of shares, as described in (1) above, the Company's shares will be provided in a lump-sum based on
100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 payment rate which is calculated within the scope of 0% to 150% based on the method decided by the Company’sboard of directors according to the achievement rates of ROE and sales growth during the three consecutive fiscal
years.
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 67 million yen and 57 miliom yen.
23. Dividends
Dividends payments were as follows:
For the year ended December 31, 2018
Resolution

Type of shares

Total amount ofdividends paid
(Millions ofyen)

Dividends per
share
(Yen)

Dividend record
date

Effective date

4,494

22

December 31,
2017

March 28, 2018

4,679

25

June 30, 2018

Total amount ofdividends paid
(Millions ofyen)

Dividends per
share
(Yen)

Dividend record
date

Effective date

4,587

25

December 31,
2018

March 27, 2019

4,484

25

June 30, 2019

March 27, 2018
Ordinary General
Meeting ofOrdinary
share

Shareholders
August 10, 2018

Ordinary

Board of Directors

share

September 3,
2018

For the year ended December 31, 2019
Resolution

Type of shares

March 26, 2019
Ordinary General
Meeting ofOrdinary
share

Shareholders
August 7, 2019

Ordinary

Board of Directors

share

September 2,
2019

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 26,
2020
Ordinary
GeneralOrdinary
share

4,484

Retainedearnings

Meeting of
Shareholders

101

25

December 31,
2019

March 27, 2020

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.
24. Revenue(1) Revenue
The Group's organizational structure is based on the two business segments of the Beverage business and Healthcare &Skincare business. These two businesses are components for which discrete financial information is available, and whose
operating results are regularly reviewed by the entity’s chief operating decision maker to make decisions about resources tobe 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 andother beverages in Japan. In the Healthcare & Skincare business, the Group manufactures and sells kale juice (aojiru) andother products made from Kale and manufactures and sells health foods and cosmetics and other related products.
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.
For the year ended December 31, 2018
(Millions of yen)
Reportable segments
Beverage business
Beverage
Health food
Other
Total

Healthcare &Skincare business

Total

899,070-899,070-

27,44427,444

793

-

793

899,863

27,444927,307

For the year ended December 31, 2019
(Millions of yen)
Reportable segments
Beverage business
Beverage
Health food
Other
Total

Healthcare &Skincare business
－

Total

889,065－

24,774

889,065
24,774

944

－

944

890,009

24,774

914,783(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 9 "Trade and other receivables."102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.
25. Selling, general and administrative expenses
Selling, general and administrative expenses comprise the following(Millions of yen)Previous fiscal year
(From January 1, 2018
to December 31, 2018)

Current fiscal year
(From January 1, 2019
to December 31, 2019)

Depreciation
Amortization

31,596
3,559

40,393
3,409

Sales commissions and promotional expenses
Employee benefits expenses

125,091
127,304

123,412
123,903

Shipping and commissions
Maintenance fee

85,897
17,14389,46016,950

Other
Total

35,60626,156426,195

423,685

26. Employee benefits expenses
Employee benefits expenses consisted of the following:(Millions of yen)Previous fiscal year
(From January 1, 2018
to December 31, 2018)

Current fiscal year
(From January 1, 2019
to December 31, 2019)

Cost of sales

Selling, generalandadministrative
expenses

Cost of sales

Selling, generalandadministrative
expenses

Salaries and wages

10,47384,056

10,596

82,841

Welfare and legal welfare expenses
Bonus

1,955
1,991

9,040
19,533

2,056
2,104

9,275
18,926Retirement benefit costs

460

14,674486

12,862

Total

14,880127,304

15,243

123,903103

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.
27. Other income and other expense
Other income and other expense consisted of the following:(Millions of yen)Previous fiscal year
(From January 1, 2018
to December 31, 2018)

Current fiscal year
(From January 1, 2019
to December 31, 2019)

Other income
Gains on sales of property, plant and equipment

215

2,183

Rent income
Gains on sale of investment in subsidiaries

398
481

378
-

1,022

1,567

2,116

4,127

Losses on disaster (Note1)
Impairment losses

8,874
202

1,011

Losses on sales and disposals of property, plant andequipment

3,771

3,954

-

655
9,184

539

272

13,385

15,076

Other
Total
Other expense

Transformation-related expenses (Note 2)
Special retirement allowance (Note 3)
Other
Total

(NOTE) 1. Losses on disaster was due to damage of flood to some equipment, finished goods inventories, vending machines and vehicles
caused by extraordinary rain in July 2018, including the Hongo manufacturing plant in Mihara City, Hiroshima Prefecture,in the Beverage business. The breakdown of losses on disaster was loss of fixed assets of 5,968 million yen, inventories of
1,471 million yen and others of 1,435 million yen.
2. Transformation-related expenses are expenses related to measures aimed at creating an efficient new system with the aim ofcreating more value and further improving productivity for the sustainable growth of the Group.
3. Special retirement allowance are Special retirement allowances and outplacement support expenses incurred in theimplementation of the voluntary retirement program for the current consolidated fiscal year.

104

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.
28. Financial income and financial expense
Financial income and finance expense consisted of the following:(Millions of yen)Previous fiscal year
(From January 1, 2018
to December 31, 2018)

Current fiscal year
(From January 1, 2019
to December 31, 2019)

Financial income
Interest income
Financial assets measured at amortized cost
Dividends income

29

1

487

508

312
2

538
98

Total

830

1,145

Financial liabilities measured at amortized cost.
Derivative expenses

612
130

1,175
-

3

-

745

1,175

Financial assets measured at fair value through othercomprehensive income
Foreign exchange gains
Other

Finance expense
Interest expenses

Other
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
29. 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
(From January 1,
2018
to December 31,
2018

Current fiscal year
(From January 1,
2019
to December 31,
2019

Previous fiscal year
(As of December 31,
2018)

Current fiscal year
(As of December 31,
2019)

7,094

6,013

(403)

(1,081)-

13,484-(1,717)

Financial assets

1,745

1,548

365

(488)

Employeebenefits

16,785

13,706

2,452

(127)

Inventories
Carryforwards

1,492

1,502

611

10

of unused tax
losses

432

1170

158

739

3,126

2,858

(1,070)263

30,67340,2802,113(2,926)(38,576)(36,563)

2,273

1,923

Lease
Financial assets(4,863)(13,290)(6,050)

(56)

1,738
(1,231)

Employeebenefits(1,495)

(389)

(23)

1,101

Deferred tax
assetsProperty, plantand equipment
and intangible
asset
Lease

Other
Subtotal
Deferred tax
liabilities
Property, plantand equipment
and intangible
asset

Other
Subtotal
Total deferred tax
expenseTotal deferredtaxes(2,559)(2,681)(93)

39(47,492)(59,063)

2,101

3,570

-

-

4,214

644

(16,819)(18,782)

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. In
assessing the recoverability of deferred tax assets, the Group considers the anticipated reversal of deferred tax liabilities,
projected future taxable income and tax planning strategies. Based on historical trends in taxable income and projected
future taxable income for the periods in which deferred tax assets is recognized, the Group believes that it is more likely
than not that tax benefits of these deferred tax assets will be realized at the end of the prior fiscal year and at the end of106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 current fiscal year. The Group believes that changes in the economic environment surrounding the Group, market
conditions and other factors 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, 2018
to December 31, 2018
Balance at the beginning of the year (prior to restatement)
Adjustments due to the adoption of IFRS 9, etc.
Balance at the beginning of the fiscal year (after
restatement)
Amounts recognized in deferred tax expense
Amounts recognized in other comprehensive income
Other
Balance at the end of the year

Current fiscal year
(From January 1, 2019
to December 31, 2019(24,778)(16,819)-172(24,778)(16,646)

4,214
3,726
19

644
(2,751)(29)(16,819)(18,782)(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 and carryforwards of unused tax losses.
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, 2018)

Current fiscal year
(As of December 31, 2019)

21,161

19,874

Deductible temporary differences
Carryforwards of unused tax losses
Total

146

203

21,307

20,077The expiry of carryforwards of unused tax losses for which deferred tax assets is not recognized at the end of theprevious fiscal year and at the end of the current fiscal year are as follows:(Millions of yen)Previous fiscal year
(As of December 31, 2018)

Current fiscal year
(As of December 31, 2019)

No later than 1 year
Later than 1 year and not later than 5 years-－－

Later than 5 years and not later than 10 years
More than 10 years

146
-

203
－

146

203

Total

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, 2018)

Current fiscal year
(As of December 31, 2019)

156,324

80,129Investments in subsidiaries and associates

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
(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, 2018
to December 31, 2018)
Current tax expenses
Deferred tax expenses
Total

Current fiscal year
(From January 1, 2019
to December 31, 2019)

8,819(4,214)

3,090
(614)

4,605

2,476

The above deferred tax expenses was 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, 2018
to December 31, 2018)

Current fiscal year
(From January 1, 2019
to December 31, 2019)31.69%
3.12%

31.46％(0.49％)

Impairment losses of goodwill
Changes in unrecognized deferred tax assets(4.86%)(35.12％)0.02％

Tax rate difference between the Company andsubsidiaries

2.82%

Other

(1.59%)

0.12％

31.18%(4.47％)

Statutory tax rate
Items which are not taxable or deductible

Applicable tax rate

108

(0.46％)

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.
30. 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, 2018
to December 31, 2018)

Current fiscal year
(From January 1, 2019
to December 31, 2019)

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

(4,411)

8,549

Tax effect1,522(2,953)

Net of tax(2,889)5,596

Amount arising during the year
Tax effect

(4)
-

4
-

Net of tax(4)

4

Share of other comprehensive income in equity method
investees:

Financial asset measured at fair value through othercomprehensive income:Amount arising during the year
Tax effect
Net of tax(5,048)

981

1,704

(360)

(3,344)621(6,236)

6,221

(12)

-

Tax effect--

Net of tax

(12)

-

(1,216)(663)

Subtotal
Items that may be reclassified to profit or loss
Foreign currency translation differences of foreign
operations:
Amount arising during the year

Cash flow hedge:
Amount arising during the year
Tax effect

500

229

Net of tax

(716)

(434)

Subtotal

(728)

(434)

Total other comprehensive income(6,965)

5,788

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
31. 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)
Short-term loans
payableLong-term loans
payable (Note)

Bonds (Note)

24,00013,849(1,817)65,822
-

1,713
(830)

-

Changes without cash flows

-

-

59

18

-

Balance at December 31, 2018

24,00012,032

65,881

901

-

-

-

-

(901)

45,406

Balance as of January 1, 201924,00012,032

65,881-45,406

Changes with cash flows
Changes without cash flows(24,000)-(1,686)-

129,441
81-(7,576)2,942

Balance at December 31, 2019-

10,346

195,402-40,773

Balance at January 1, 2018
Changes with cash flows

Adjustments resulting from theadoption of IFRS 16

Lease debt

Lease liabilities(NOTE) These include amounts of long term loan and bond due within one year.
32. 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 of110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 obligor. All receivables other than trade receivables for which the Group measures the allowance for credit loss at thesame 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
rate and 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, 2018
(Millions of yen)

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

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

21,463-67,41888,881

82
-

203

3,046
432

3,128
635

21,545203

70,897

92,644

Total

Financial asset assessed by an amount equal to lifetime expected credit losses is primarily a creditimpairment financial asset.
As of December 31, 2019
(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

Unexpired

20,102-75,527

95,629Within 60 days of the due dateMore than 60 days from the due date

1,026
-

110

1,987
42

3,013
151

21,129110

77,55598,793

Total

Total

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 theother party. 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, whichassessed by a 12-month expected credit losses, and the credit risk rating grades of financial assets in the same
category is generally the same.

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 the event 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, 2018
(Millions of yen)
Financial asset
assessed by 12-month
expected credit losses
Other financial asset

Financial asset
assessed by anamount equal tolifetime expectedcredit losses

5,803

Total

1,330

7,133

Financial asset assessed by an amount equal to lifetime expected credit losses is primarily a credit-impairment
financial asset.
As of December 31, 2019
(Millions of yen)
Financial asset
assessed by 12-month
expected credit losses
Other financial asset

Financial asset
assessed by anamount equal tolifetime expectedcredit losses

5,217

Total

1,297

6,514

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, 2018
(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

17
19

149
128

118
97

284
244

-

-

(7)

(7)

Reduction during the period (reversal)

(17)

(149)

(112)

(278)

Balance at December 31, 2018

19

128

95

242

Financial asset
assessed by
12-month
expected
credit losses

Financial asset
assessed by anamount equal
to lifetime
expected
credit losses

Balance at January 1, 2019

19

128

95

242

Provision
Reduction during the period (reversal)

35
(19)

53
(128)

178
(95)

265
(242)

Balance at December 31, 2019

35

53

178

265

Balance at January 1, 2018
Provision
Changes due to organizational restructuring(mergers, organizational splits, etc.)

Total

For the year ended December 31, 2019
(Millions of yen)
Financial assetof applying
simplified
approaches

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.
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
Other financial asset
For the year ended December 31, 2018
(Millions of yen)
Financial asset
assessed by 12-month
expected credit losses

Financial asset
assessed by anamount equal tolifetime expectedcredit losses

Total

Balance at January 1, 2018
Provision

6
0

955
507

960
507

Changes due to organizational restructuring(mergers, organizational splits, etc.)

-

(3)

(3)

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

(6)

(205)
(7)

(205)
(13)

Balance at December 31, 2018

0

1,246

1,247

For the year ended December 31, 2019
(Millions of yen)
Financial asset
assessed by 12-month
expected credit losses
Balance at January 1, 2019
Provision

0
0－

Financial asset
assessed by anamount equal tolifetime expectedcredit losses

Total

1,246
334

1,247
335

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

(0)

(486)
(386)

(486)
(386)

Balance at December 31, 2019

0

709

709

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

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 the event 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, 2018
(Millions of yen)
Carrying
amountCash flows
on contract

Not later than
1 yearLater than 1
year and notlater than 5
years

105,701
101,913

105,701
102,832

105,701
46,01250,742

6,077

901

911

495

411

4

More than 5
years

Non-derivative financial liabilities
Trade and other payables
Bonds and loans payable
Finance lease liabilities
Derivative financial liabilities
Commodity swap

503

503

503

-

-

Total

209,018

209,946

152,712

51,153

6,082

More than 5
years

As of December 31, 2019
(Millions of yen)Non-derivative financial liabilities
Trade and other payables
Bonds and loans payable
Finance lease liabilities
Derivative financial liabilities
Commodity swap
Total

Carrying
amountCash flows
on contract

Not later than
1 yearLater than 1
year and notlater than 5
years

122,364

122,364

122,364－－

205,748
40,773

208,645
43,187

17,773
7,321

75,345
18,114

115,527
17,753

916

916

916

－

－

369,801

375,112148,374

93,458133,280(4) Market risk
Market risk is the risk of fluctuations in interest rates, stock prices and other market prices that may affect the valueof 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
Most loans payable and bonds are fixed interest rates. Accordingly, the impact of changes in interest rates on profit
or loss 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 are designated 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 2,417
million yen and 2,248 million yen, respectively, for the previous fiscal year and current fiscal years.

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 the event 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, 2018
to December 31, 2018)

Current fiscal year
(From January 1, 2019
to December 31, 2019)

ROE

1.64%

(10.67%)

ROA

1.63%

(6.06%)The Group does not have any significant capital controls imposed by external parties.

115

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.
(6) Classification of financial instruments
Balances by financial assets and financial liabilities classification were as follows:
Financial assets
As of December 31, 2018
(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--

65,51065,510Trade and other receivables
Other financial asset (current)--

92,402

92,402

426

-

-

426

-

-

116

116

-

-

46

46

-

-

57

57

426

-

219

645

Derivative assets
Securities

41-

28,964-41
28,964Long-term loans receivable
Other

-

124

86
5,581

86
5,705

Subtotal

41

29,088

5,667

34,796

Total

467

29,088

163,799

193,353

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

-

116

Total

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.
As of December 31, 2019
(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

－
－

－
－

113,825
98,528113,825
98,528Other financial asset (current)
Derivative assets

Total

556

－

－

556

Term deposits which mature due within
three months

－

－

55

55

Current portion of long-term loans
receivable

－

－

19

19

－

－

121

121

556

－

195

752

－

－
－

23
27,728

Other
Subtotal
Other financial asset (non-current)
Derivative assets
Securities

23－

Long-term loans receivable－

27,728
－

68

68

Other

－

138

5,541

5,680

Subtotal

23

27,867

5,609

33,499

Total

579

27,867

218,158

246,604

Financial liabilities
As of December 31, 2018
(Millions of yen)
Financial instrument
measured at fair value
through profit or loss

Financial instrument
measured atamortized cost

Trade and other payables-

105,701

105,701

Bonds and loans payable
Other financial liabilities (current)-

101,913

101,913

503
-

491

503
491

503

491

993

-

411
338

411
338

Subtotal

-

749

749

Total

503

208,853

209,356

Derivative liabilities
Finance lease liabilities
Subtotal
Other financial liabilities (non-current)
Finance lease liabilities
Long-term accounts payable

-

117

Total

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.
As of December 31, 2019
(Millions of yen)
Financial instrument
measured at fair value
through profit or loss

Financial instrument
measured atamortized cost-

122,364
205,748

122,364
205,748

40,773

40,773-916

Trade and other payables
Bonds and loans payable
Lease liabilities
Other financial liabilities (current)
Derivative liabilities

916

Total

Subtotal

916

-

916

Total

916

368,885

369,801

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)Previous fiscal year
(As of December 31, 2018)

Current fiscal year
(As of December 31, 2019)

Ricoh Co., Ltd.

3,697

4,092

Royal Holdings Co., Ltd.
San-ai Oil Co., Ltd.

1,688
1,425

1,638
1,562

Central Japan Railway Company
East Japan Railway Company

1,253
1,117

1,190
1,134

Nishi-Nippon Railroad Co., Ltd.

1,106

1,008

Issue

Dividends income related to investments held at the reporting date was as follows:(Millions of yen)Previous fiscal year
(From January 1, 2018
to December 31, 2018)
Dividends income

Current fiscal year
(From January 1, 2019
to December 31, 2019)

487

481

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, 2018 to December 31, 2018)
Fair value
319

Cumulative gain
(Loss)

Current fiscal year
(From January 1, 2019 to December 31, 2019)

Dividends
incomeFair value
－

131

2,247

Cumulative gain
(Loss)

Dividends
income

1,097

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 21. Equity (5) Accumulated other comprehensive income

-

118

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 the event 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, 2018
Type

ValuationtechniqueSignificant unobservable inputs

Interactions between significant unobservable
inputs and fair value measurement

Comparisonof similar

EBIT Multiple: 6.1-44.6 times
EBITDA Multiple: 8.3 times

Estimated fair value increases (decreases)
when equity indices of comparable listedcompanies

PBR: 1.0-2.0 times

companies of the target are high (low)Significant unobservable inputs

Interactions between significant unobservable
inputs and fair value measurement

Comparison

EBIT Multiple: 9.2-46.5 times

Estimated fair value increases (decreases)of similar
companies

EBITDA Multiple: 8.6 times
PBR: 1.0-2.7 times

when equity indices of comparable listedcompanies of the target are high (low)Financial
instrument
measured atfair value
through othercomprehensi
ve income(Securities)
As of December 31, 2019
Type

Valuationtechnique

Financial
instrument
measured atfair value
through othercomprehensi

ve income(Securities)
EBIT Multiple: Corporate Value/EBIT
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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
EBITDA Multiple: Corporate Value/EBITDAPBR: Price Book Value Ratio(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, 2018
(Millions of yen)
Level 1

Level 2

Level 3

Total

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

-

467

-

467

-

467

-

467

24,173-

4,790

28,964

-

-

124

124

Subtotal

24,173-

4,914

29,088

Total

24,173467

4,914

29,555

-

503

-

503

-

503

-

503

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

Financial liabilities
Financial instrument measured at fair value
through profit or loss:
Derivative liabilities
Total
As of December 31, 2019
(Millions of yen)
Level 1

Level 2

Level 3

Total

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

579

－

579

－

579

－

579

22,475－－

5,253

27,728

－

138

138

Subtotal

22,475－

5,392

27,867

Total

22,475579

5,392

28,446

－

916

－

916

916

－

916

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

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.
120

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.
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.
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, 2018

6,317

Purchase
Disposals

75(75)

Gains or losses recognized in other comprehensive income(1,402)

Balance at December 31, 017
Purchase

4,914-

Disposals
Gains or losses recognized in other comprehensive income

(4)
481

Balance at December 31, 2018

5,392

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, 2018
(Millions of yen)
Carrying amountLong-term loans payable and bonds

77,913

Fair value

Difference

78,704(792)

As of December 31, 2019
(Millions of yen)
Carrying amountLong-term loans payable and bonds

205,748

Fair value
205,627

Difference
122

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.
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 the event 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, 2018
(Millions of yen)
Hedge typeHedging
instrument

Risk category

Carrying amount (fair value)
AssetsLiabilities

ForwardCurrencyrisk

Cash flow hedges

Notional
amountexchange
contracts
Commodity
swap

Price risk
Total

12,761

439

-

9,022

28

503

21,783

467

503

The average exchange rate used for forward exchange contracts was 105.33 yen per U.S. dollar.
As of December 31, 2019
(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

15,567404-

19,116

175

916

34,684579

916

The average exchange rate used for forward exchange contracts was 105.42 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 January 2020 to January 2021 and from January 2020 to December 2020, 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, 2018)

Current fiscal year
(As of December 31, 2019)

Forward exchange contracts

215

84

Commodity swap

(355)

(529)

(141)

(445)

Total

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 the event 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, 2018

Risk category

Currency risk
Price risk
Total

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

29(1,245)49(1,216)

Changes in fairvalue of hedging
instrument used as
the basis forrecognizing thehedge ineffective(Millions of yen)Amounts
reclassified fromaccumulated othercomprehensive
income to profit orloss asreclassification
adjustments
-

-

439
(475)

49

(35)

-

-

For the year ended December 31, 2019

Risk category

Amount of hedging
gains or losses
recognized in othercomprehensive
incomeChanges in fairvalue of hedging
instrument used as
the basis forrecognizing thehedge ineffective
404

－

(843)

157
－

(740)

－

(663)

157

(336)

－

Currency risk

180

Price risk
Total

Hedge
ineffectivenessrecognized in profit
or loss(Millions of yen)Amounts
reclassified fromaccumulated othercomprehensive
income to profit orloss asreclassification
adjustments

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.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
33. Significant subsidiaries
Significant subsidiaries of the Groups is 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

Beveragebusiness

Name ofsubsidiary
Coca-Cola
Bottlers JapanInc.

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, 2018)

Current fiscal year
(As of December
31, 2019)

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

foods
Vending

Higashi-ku,
Fukuokamachineoperation

Higashi-ku,
Fukuoka

In-officebusiness(Note )
Manufacture
Healthcare &Skincarebusiness

Q’SAI CO., LTD.

and sales ofhealth foods

Chuo-ku,
Fukuokaandcosmeticsrelated
products(NOTE) Percentage of voting rights includes indirect holdings through subsidiary.
34. Investments accounted for using the equity method
The primary associates of the Group is as follows: The principal business locations are the same as those of the Company.
There are no individually significant associate.
Percentage of voting rightOperatingsegment

Name of associate

Location of head
officeBeverage

Apex Nishi-nihon

Fukushima-ku,

businessCo., Ltd.

Osaka

Resources Inc.

Takamatsushi, Kagawa

The details of
the business

Previous fiscal
year(As of December
31, 2018)

Current fiscal year
(As of December
31, 2019)

Beverage sale

34.0%

34.0%

44.0%

44.0%

Vending
machinerelated

business(NOTE) Percentage of voting rights includes indirect holdings through subsidiary.

124

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.
35. Commitment(1) 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, 2018)

Current fiscal year
(As of December 31, 2019)

Property, plant and equipment
Intangible assets

906
252

34,680
31

Total

1,157

34,710Purchase commitments excluding the above amounts were 2,422 million yen and 4,575 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.
(2) Operating leases
Future minimum lease payments under non-cancelable operating lease are as follows:(Millions of yen)
Current fiscal year
(As of December 31, 2018)
No later than 1 year

1,837

Later than 1 year and not later than 5 years
More than 5 years

4,882
925

Total

7,644

The amount recognized as expenses in non-cancellable and non-cancellable operating leases in the previous fiscal year
was 11,573 millions of yen. These amounts are included in “Cost of sales” and “Selling, general and administrative
expenses” in the consolidated statements of income(3) Finance leases
Finance lease obligations consisted of the following:(Millions of yen)
Current fiscal year
(As of December 31, 2018)
Minimum Payment lease payments:
Not later than 1 year

495

Later than 1 year and not later than 5 years
More than 5 years

411
4

Total

911

Future financing costs:
Not later than 1 year

(5)

Later than 1 year and not later than 5 years
More than 5 years

(5)
(0)

Total

(9)

Present value of minimum lease payments:
Not later than 1 year

491

Later than 1 year and not later than 5 years
More than 5 years

407
4

Total

901
125

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.
36. Earnings per share
The computation of basic earnings 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 per share is as follows.
Previous fiscal year
Current fiscal year
(From January 1, 2018
(From January 1, 2019
to December 31, 2018)
to December 31, 2019)
Net profit for the year attributable to owners of the parent
10,117(Millions of yen)
Weighted-average shares of ordinary share outstanding (in192,051
thousands)
Basic earnings(loss) per share (Yen)
52.68(NOTE) Earnings per share after dilution is not disclosed because there are no dilutive shares.

(57,952)
179,852(322.22)

37. 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, 2018
(Millions of yen)Name

Relationship withaffiliated companies

Coca-Cola (Japan)

Subsidiary of othersubsidiaries andrebates of sales
promotion

associates

Purchase ofconcentrate

Transaction

The amount of thetransaction

Amount outstanding

Income from

Company, Limited

127,123

12,501

359,636

22,393For the year ended December 31, 2019
(Millions of yen)
Relationship withaffiliated companies

Name

Coca-Cola (Japan)
Company, Limited

Transaction

Subsidiary of other

Income from
rebates of sales

subsidiaries andassociates

promotion
Purchase of

The amount of thetransaction
128,200

Amount outstanding

12,388357,593
25,341concentrate
The transaction amount does not include consumption taxes, but the amount outstanding includes consumption taxes.
Transactions with Coca-Cola (Japan) Company, Limited are conducted based on the contract concluded with The CocaCola Company and Coca-Cola (Japan) Company, Limited concerning the manufacture, sale of the Coca-Cola etc. anduse of the Coca-Cola trademark.
Compensation for major key management personnel is as follows.
Previous fiscal year
(From January 1, 2018
to December 31, 2018

(Millions of yen)
Current fiscal year
(From January 1, 2019
to December 31, 2019

Remuneration

463

508

Stock-based compensation
Bonus

27
85

50
96

575

653

Total

38. Events after the reporting period
Not applicable126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.
(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)

198,733

433,710

694,763914,783(Yen)(12,715)(65,513)(51,848)(55,419)(Yen)(8,002)(64,565)(55,693)(57,952)(Yen)(44.22)(358.14)(309.40)(322.22)

Net income (loss) before income taxes
and minority interests for the quarter oryear
Net income (loss) in attributable toowners of the parent for the quarter or
year
Earnings (loss) per share

1st quarter(Quarter-to-date)
Earnings (loss) per share(Yen)(44.22)127

2nd quarter(315.37)

3rd quarter
49.47

4th quarter(12.59)

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 the event 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, 2018)
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
Long-term loans receivable from subsidiaries
and associates
Long-term prepaid expenses
Deferred tax assets
Other
Total investments and other assets
Total fixed assets
Total assets

128

Current fiscal year
(As of December 31, 2019)

20,43266
2,102※ 1 561,600
24,256

94,50447－※１ 315
3,895
98,76020,121
1,467
28
52,16873,784

18,4361,274
23
51,32971,061

27
4
31

27
3
30

379,080

379,043

485

－

6
294
547
380,413454,228
478,484－245
543
379,831450,922549,683

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.
(Millions of yen)Previous fiscal year
(As of December 31, 2018)
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

129

Current fiscal year
(As of December 31, 2019)24,00020,000※ 1 25612※ 1 54,337
36
85
21
98,747－
16,000※１ 44811※１ 20,522
8
96
247
37,33246,0001,013
24
194
47,230145,977

180,000
1,013
64
135
181,211
218,543

15,232

15,232

108,167
158,785
266,952

108,167
158,784
266,951

3,317

3,317

766
110,3888,503
122,974(72,651)
332,507332,507478,484761
110,388
20,140134,606(85,649)
331,139
331,139549,683

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.
② Statements of profit or loss
(Millions of yen)Previous fiscal year
(From January 1, 2018
to December 31, 2018
Operating revenue
Operating expenses
Operating profit
Non-operating income
Interest and dividends income
Other
Total non-operating income
Non-operating expenses
Interest expense
Bond issuance costs
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Impairment losses
Special retirement allowance
Loss from disaster
Total extraordinary losses
Income before income tax
Income taxes
Income tax adjustments
Total income taxes
Net profit※１

Current fiscal year
(From January 1, 2019
to December 31, 201910,375
4,640
5,734

※１,※２

4
164
168

※１
※１

509
－
※１ 170
678
5,224
※１

－
－
－
※４ 4
－
※５ 1,066
1,070
4,153
(59)
(183)
(242)
4,395

130

※１

26,517
4,787
21,730

※１,※２

5
26
31

※１
※１

602
559
※１ 328
1,489
20,273
※１

1,052
1,052
155
231
74
－
460
20,865114
49
163
20,702※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 the event 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, 2018 to December 31, 2018)(Millions of yen)
Shareholders' equity
Capital surplus

Retained earnings

Capital stock
Legal capital reserve Other capital surplus Total capital surplus
Balance at January 1, 2018

Other retained
earnings

Legal reserve

15,232

108,167

158,785-

266,951

3,317

124,435

Dividend of surplus

-

-

-

-

-

(9,173)

Net profit

-

-

-

-

-

4,395

Purchase of treasury stock

-

-

-

-

-

－

Disposal of treasury stock

-

-

1

1

-

－

Net changes in items otherthan shareholders' equity

-

-

-

-

-

－

Total changes during the year

-

-

1

1

-

(4,777)

Balance at December 31, 201815,232

108,167

158,785

266,952

3,317

119,657

Changes during the year

Shareholders' equity
Retained earnings
Total retained
earnings
Balance at January 1, 2018

Total net assets

Total shareholders’equityTreasury stock

127,752(4,693)405,242405,242Dividend of surplus(9,173)－(9,173)(9,173)

Net profit

4,395

－

4,395

4,395

Purchase of treasury stock－(67,961)(67,961)(67,961)

Disposal of treasury stock

－

4

4

4

Net changes in items otherthan shareholders' equity

－

－

－

－

Total changes during the year

(4,777)(67,958)(72,735)(72,735)

Balance at December 31, 2018

122,974(72,651)

332,507332,507

Changes during the year131

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.
Current fiscal year (From January 1, 2019 to December 31, 2019)(Millions of yen)
Shareholders' equity
Capital surplus

Retained earnings

Capital stock
Legal capital reserve Other capital surplus Total capital surplus
Balance at January 1, 2019

Other retained
earnings

Legal reserve

15,232

108,167

158,785

266,952

3,317

119,657

Dividend of surplus

-

-

-

-

-

(9,071)

Net profit

-

-

-

-

-

20,702

Purchase of treasury stock

-

-

-

-

-

-

Disposal of treasury stock

-

-

(1)

(1)

-

-

Net changes in items otherthan shareholders' equity

-

-

-

-

-

-

Total changes during the year

-

-

(1)

(1)

-

11,631

Balance at December 31, 201815,232

108,167

158,784

266,951

3,317

131,289

Changes during the year

Shareholders' equity
Retained earnings
Total retained
earnings
Balance at January 1, 2019

Total net assets

Total shareholders’equityTreasury Shares

122,974(72,651)

332,507332,507

Dividend of surplus(9,071)-(9,071)(9,071)

Net profit

20,702-

20,702

20,702

Purchase of treasury stock-(13,002)(13,002)(13,002)

Disposal of treasury stock

-

3

3

3

Net changes in items otherthan shareholders' equity

-

-

-

-

Total changes during the year

11,631(12,999)(1,368)(1,368)

Balance at December 31, 2018

134,606(85,649)

331,139

331,139

Changes during the year132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.
Supplemental notes of the statement of changes in equity(NOTE) Breakdown of other retained earnings
Previous fiscal year (From January 1, 2018 to December 31, 2018)
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)

790

110,388

13,257

124,435

Dividend of surplus--(9,173)(9,173)

Net income

-

-

4,395

4,395

Reversal of reserves

-

-

-

-

Reversal of reserve funds

(24)

-

24

-

Purchase of treasury stock

-

-

-

-

Disposal of treasury stock

-

-

-

-

Changes in items other thanshareholders' equity, net

-

-

-

-

Total changes during the year

(24)

-

(4,754)(4,777)

Balance at December 31

766

110,388

8,503

119,657

Changes during the year

Current fiscal year (From January 1, 2019 to December 31, 2019)
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)

766

110,388

8,503

119,657

Dividend of surplus--(9,071)(9,071)

Net income--

20,702

20,702

Reversal of reserves

-

-

-

-

Reversal of reserve funds

(5)

-

5

-

Purchase of treasury stock

-

-

-

-

Disposal of treasury stock

-

-

-

-

Changes in items other thanshareholders' equity, net

-

-

-

-

Total changes during the year(5)-

11,637

11,631

Balance at December 31

761

110,388

20,140131,289

Changes during the year133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.
【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.

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 the event of any discrepancy between Yukashoken Hokokusho and this English translation, Yukashoken
Hokokusyo shall prevail.
(Notes on changes to presentation method)
Changes with the application of the “Partial Amendment to Accounting Standards for Tax Effect Accounting”“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 fiscal year under review. Accordingly,
deferred tax assets are reported under “Investments and other assets”, and deferred tax liabilities are reported under “Longterm liabilities”.
The impact on the balance sheet as of December 31, 2018 is 404 million yen of deferred tax assets that were reclassified
from “Current assets” to “Investments and other assets”.

(Notes to Balance Sheet)※1 Amounts related to subsidiaries and associates included in them are as follows.
Previous fiscal year
(As of December 31, 2018)
Short-term monetary receivables

42 million yen

Short-term monetary payables

54,375Current fiscal year
(As of December 31, 2019)
305 million yen
20,6182 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, 2018)
Maximum overdraft amount

245,000 million yen

Used outstanding of loans
Net amount

135

Current fiscal year
(As of December 31, 2019)
255,000 million yen

24,000-221,000

255,000

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.
(Notes to statement of profit or loss)※1 Transactions with affiliated companies
Previous fiscal year
(From January 1, 2018
to December 31, 2018)
Sales revenue and operating revenue
Purchases and consignment processing costs

10,375 million yen
0Transactions excluding operating transactions

12

Current fiscal year
(From January 1, 2019
to December 31, 2019)
26,517 million yen
30※2Major items and amounts of selling, general and administrative expenses and operating expenses are as follows:
Previous fiscal year
(From January 1, 2018
to December 31, 2018)
Depreciation.
Taxes and dues

1,806 million yen
824

Current fiscal year
(From January 1, 2019
to December 31, 2019)
1,694 million yen
933

Rents expenses
Consignment expenses of business activities

513
112

500
201

Provision for directors' bonus provision
Provision for performance-linked

85

96

24

40

23

29

6
(4)

5
14

compensation provision
Advertising expenses
Retirement benefit expenses
Bonuses and provision for bonuses provision※3 The breakdown of gain on sales of non-current assets is as follows:
Previous fiscal year
(From January 1, 2018
to December 31, 2018)

Current fiscal year
(From January 1, 2019
to December 31, 2019)

Buildings- million yen

194 million yen

Land

-

858

※4 The breakdown of loss on sales of non-current assets is as follows:
Previous fiscal year
(From January 1, 2018
to December 31, 2018)Land- million yen

136

Current fiscal year
(From January 1, 2019
to December 31, 2019)
155 million yen

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.
※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, 2018 to December 31, 2018)
RegionUse

Number of sites

Kinki

Idle asset

1

Land

1 million yen

3

Buildings
Structures

0
0

Land

4

KyushuIdle asset

Type

Impairment losses

Current fiscal year (From January 1, 2019 to December 31, 2019)
RegionUse

Number of sites

Kinki

Idle asset

3

KyushuIdle asset

2

Type

Impairment losses

Buildings
Structures

11 million yen
1

Land

218

Land

1

※6 Loss from disaster
The loss on disaster was due to the damage of flood to fixed assets, such as certain manufacturing and sales facilities,
including the Hongo manufacturing plant in Mihara City, Hiroshima Prefecture, caused by extraordinary rain in July
2018.
(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 379,080 million yen and 379,043 million yen, respectively) are notnoted, as they do not have quoted market prices and it is deemed extremely difficult to determine their fair value.

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 the event 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, 2018)

Current fiscal year
(As of December 31, 2019)

1,903 million yen
409

1,865 million yen
294

Deferred tax assets
Excess of depreciation
Carryforwards of unused tax losses
Impairment losses
Loss on valuation of investment securities of

661

454

8

－

529

617

Subtotal deferred tax assets

3,510

3,231

Valuation allowance

(746)

(554)

Total deferred tax assets
Deferred tax liabilities

2,763

2,677

(979)
(1,380)(969)(1,380)

(110)

(83)

(2,469)(2,432)294

245

subsidiaries
Other

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

2. Differences between the statutory tax rate and the applicable tax rate after tax effectPrevious fiscal year
(As of December 31, 2018)

Current fiscal year
(As of December 31, 2019)

Statutory tax rate

30.9%

30.6%

Adjustments:
Dividends income(37.8)(29.7)

Permanent differences such as entertainment
expense2.5

0.7

Valuation allowance
Other

(0.5)
(0.9)

(0.9)
0.1

(5.8)

0.8

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

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 the event 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

76,588－Structures

12,535－35－

52,168－141,326－

Leasehold

27－

Software5
32

Classification

Property, plantand equipment

Type of asset

Machinery, equipment,
vehicles
Land

Total
Intangible
assets

Total

Decreaseduring the
year
879

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

1,517

75,70957,273180

12,446

11,172

5

35

12

－

51,329－1,702

139,519

68,458

－

－

27

－

－

－

1

5

2

－

－

1

32

2

(11)
89
(1)
－
840
(219)
1,808
(231)

(NOTE) 1. Breakdown of main decrease is as follows:Land

Impact of sales of Toko office

344 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

36

8

36

8

Allowance for officers’ bonuses

85

96

85

96

Officer’s compensation

24

40

－

64

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

139

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.

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.
Assorted Coca-Cola products will be presented to shareholders recorded on the register ofshareholders and registry of beneficial shareholders as of December 31, 2019, after late March

the following year according to the number of shares held and holding period.
(Holding period of less than 3 years)
Shareholder holding from 100 to less than 1,000 shares: Assorted Coca-Cola products equivalent to1,000 yen
Benefits to shareholders
Shareholder holding from 1,000 or more shares: Assorted Coca-Cola products equivalent to 1,500
yen(Holding period of 3 years or more)
Shareholder holding from 100 to less than 1,000 shares: Assorted Coca-Cola products equivalent to3,000 yen
Shareholder holding from 1,000 or more shares: Assorted Coca-Cola products equivalent to 4,500
yen(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:
140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.
- 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

141

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.

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 (61st term) (January 1, 2018 to December 31, 2018) Submitted to Kanto Finance Bureau March 27, 2019(2) Internal control report
Submitted to Kanto Finance Bureau March 2019(3) Quarterly report and confirmation(First half of the 62nd term) (January 1, 2019 to March 31, 2019) Submitted to Kanto Finance Bureau Chief May 2019
(Second quarter of the 61th term) (April 1, 2019 to June 30, 2019) Submitted to Kanto Finance Bureau Chief August 2019
(Third quarter of the 61th term) (July 1, 2019 to September 30, 2019) Submitted to Kanto Finance Bureau Chief November
2019(4) Extraordinary report

Filed with the Director-General of the Kanto Local Finance Bureau on March 2019
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.
Filed with the Director-General of the Kanto Local Finance Bureau on August 2019
Extraordinary Report pursuant to Article 19, Paragraph 2, Item 19 (Incurs impairment loss) of the Cabinet Office Ordinanceon Disclosure of Corporate Affairs, etc.
(5) Treasury stock repurchase status report
Reporting period (March 1, 2019 to March 31, 2019) Submitted to Kanto Finance Bureau Chief April 2019
Reporting period (April 1, 2019 to April 30, 2019) Submitted to Kanto Finance Bureau Chief May 2019
Reporting period (May 1, 2019 to May 31, 2019) Submitted to Kanto Finance Bureau Chief June 2019(6) Shelf Registration Statement (Stock certificates, corporate bonds) and Other documents
Submitted to Kanto Finance Bureau Chief April 2019(7) Shelf Registration Supplements (Stock certificates, corporate bonds) and Other documents
Submitted to Kanto Finance Bureau Chief September 2019(8) Amended Shelf Registration Statement
Submitted to Kanto Finance Bureau Chief August 2019142

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.

Part Ⅱ. Information about company which provides guarantee to reportable segment
Not applicable143