Asahi Group Holdings, Ltd.
Fiscal 2021 Financial Results Conference Call
Date & Time: Wednesday, February 16, 2022
15:30-17:00 Japan Standard Time
Speaker: Atsushi KATSUKI, President and CEO, Representative Director◆ Executive Summary (P1)
• The Asahi Group Philosophy came into effect in 2019, and we also updated our
Medium-Term Management Policy at that time. Based on these two guidelines, wehave continued to pursue value creation management on a global basis.
• Since 2020, the Group has faced an adverse business environment owing to theimpacts of the COVID-19 pandemic, but we have continued to advance our
premium strategy in off-trade channels and have established a robust global
platform through our acquisition of the Carlton & United Breweries business inAustralia.
• We have also created a clear path toward a stronger financial position mainly
through optimal financing plans and a management approach that placesemphasis on cash flow generation.
• We continue to pursue a style of management that can flexibly respond toenvironmental changes. Based, however, on the premise that the various impactsof the pandemic have suddenly propelled us a decade into the future, themanagement team felt that discussions on medium- to long-term strategies
needed to be based on issues identified through back-casting from themegatrends we expect to see not only a decade from now, but also three decades
into the future.
• Based on these discussions, we have also updated our Medium-Term Management
Policy to create a new Medium- to Long-term Management Policy, which
incorporates our long-term strategy.
• We will aim to achieve sustained growth and enhance corporate value by building
a business portfolio that can respond to changing conceptions of well-being andby further enhancing our core strategies including those relating to sustainability,
digital transformation, and R&D. I will explain this in more detail later.
• To sum up 2021, even though the impacts of COVID-19 continued to linger, wewere able to achieve record-high revenue and profit attributable to owners ofparent mainly by ramping up our premium strategy and new value propositions,and by further streamlining operations.
• Also, we endeavored to reduce our financial obligations by more than expected
chiefly by creating synergies from the integration with Australia’s CUB into the1Group and by implementing measures aimed at maximizing cash flow.
• Challenges still remain, such as resurgences in COVID-19 infections and raw
materials cost increases. Despite this, in 2022 we intend to chalk up steady sales
and profit growth in all businesses and vigorously go about building an ideal
business portfolio and promoting core strategy initiatives in line with our updated
Medium- to Long-term Management Policy. On this point too, I will go into moredetail in a few moments.
◆ Megatrend Analysis (P2）
• In terms of megatrends through to the year 2050, we anticipate issues of a global
scale, such as climate change and the depletion of natural resources, as well aschanges in demographics, shifts in economic power, and advancements intechnology that bring about new technological capabilities for humanity and also
provide people with more free time.
• As part of these broader trends, in addition to socioeconomic changes, we also
expect to see changes to people’s conceptions of well-being. We thinksustainability-related considerations and technology will drive further
diversification and personalization of individual’s ideas about well-being.
• I will refrain from giving a detailed explanation, but as you can see in the table, interms of megatrends some 10 years from now, we expect to see an increase inhealth consciousness, headwinds from alcohol-related issues, and a heightenedawareness of sustainability-related considerations.
• For a Group whose mainstay business is alcohol beverages, taking stock ofchanges in culture and people’s behavior over a medium-to-long time horizon isan absolutely crucial task. Reassessing conventional approaches and ways ofthinking and harnessing the enrichment and fun that alcohol can deliver togenerate new value propositions and business models will, in my opinion, becomea prerequisite for the Group’s survival.
◆ Overview of Medium- to Long-Term Management Policy （P3）
• In light of this megatrend analysis and the challenges the Asahi Group will need totackle, we decided that the concept behind our long-term strategies in theMedium- to Long-Term Management Policy should be: “Contribute to societal
sustainability and responding to changing conceptions of well-being throughdelivering great taste and fun.”• Responding to changing conceptions of well-being is highly complementary to our
Asahi Group Philosophy mission: “To deliver on our great taste promise and bringmore fun to life.” This concept also demonstrates how focused we are putting the
Asahi Group Philosophy into practice.
• Based on this concept, with an ideal business portfolio we will seek to respond torisks and opportunities as we cater to the diversification of people’s ideas about
well-being and in addition to pursuing sustained growth for our beer business and2other existing businesses, we will leverage this business foundation to expand into
adjacent markets and grow new businesses and services.
• We also intend to integrate sustainability considerations into management withthe objective of driving business growth by helping to address societal issues, andalso further bolster other core strategies covering areas such as digitaltransformation and R&D.
• Furthermore, we will continue to increase diversity, equity and inclusion, andunderpin the strategies I just mentioned by enhancing human capital and Group
governance. We will also strive to fulfill our social responsibilities, achievesustained growth, and increase corporate value.
◆ Ideal Medium- to Long-Term Business Portfolio （P4）
• Firstly, in terms of an ideal medium- to long-term business portfolio, in light ofheightening health consciousness and increasing recognition of alcohol-related
issues in society, which I touched upon just a moment ago, we will set our sights
on achieving growth in existing businesses centering on the beer category, but at
the same time, we will also expand into new areas.
• In our existing businesses, we will keep a close eye on growth in personalizationand ethical consumption trends and further accelerate the implementation ofstrategies we are already pursuing, including further promotion of our premium
strategy and using our global brands to expand into new regions.
• Meanwhile, the ability of our Alcohol Beverages and Non-alcohol Beverages
businesses to share the technologies and know-how they’ve each cultivated is oneof the Asahi Group’s unique strengths even from a global point of view. In new
business domains, we intend to leverage this strength to step up new added-value
propositions aimed at tapping into demand arising from the heightened healthconsciousness and diversifying preferences of consumers.
• More specifically, we aim to bolster R&D activities and increase our sales
weightings in the beverage categories adjacent to beer, which are referred to on
this page as “BACs”, short for “beer-adjacent categories”. Beer-adjacentcategories include ready-to-drink low-alcohol beverages, non-alcohol beverages,
and soft drinks for adults.
• As for generating synergies with other areas, including the Food Business, we
intend to create new products and services by harnessing the yeast and lactic acidbacteria technologies we have accumulated over the years. And we will also
leverage the Group’s technologies to build business models geared towards
helping to address societal issues.
• Our approach will be to build an optimal business portfolio taking megatrends into
account while drawing on the capabilities and business platform we havecultivated in the beer category, and expanding opportunities for growth in beeradjacent categories and in new product and service areas.
3◆ Integrating Sustainability into Management （P5）
• Our “Cheer the Future” concept expresses our resolve to “build value together
with nature, community, and society at large for making the one and only future
shine”.
• The pinwheel diagram on the right is a schematic representation of oursustainability strategy. The circle in the middle is the virtuous cycle createdthrough integrating sustainability-related considerations into management, while
the four blades on the outside show the actions the Asahi Group ought to take.
• In order to live up to “our promise for the future”, we intend to, as it were, keep
this pinwheel spinning, by accelerating our integration of sustainability-related
considerations into our management approach throughout the Asahi Group.
◆ Key Policies and Themes of Sustainability Strategy （P6）
• In order to “realize sustainable living for our customers across the value chain,”
we have identified four key themes from among our list of material issues that we
think are particularly important to communities and the Asahi Group.
• As part of our efforts to respond to climate change, we have raised our 2030 CO2emissions reduction target from 50% to 70%. We plan to invest at least 50 billion
yen in solar power generation facilities, and pursue greater energy efficiency andthe development of new fuel-related technologies.
• We have also set ourselves some concrete targets to respond to plastic issue. In
addition to fulfilling our responsibilities in this area, we will help makecommunities more sustainable as part of Asahi Group’s mission to “deliver on our
great taste promise and bring more fun to life.”• And as I mentioned when talking about megatrend analysis, as a group primarily
engaged in the production and sale of alcohol, we will contribute to reducing
inappropriate drinking and roll out non-alcohol and low-alcohol products to create
more drinking options for consumers.
◆ Value Creation in Our Sustainability Strategy （P7）
• With regard to the creation of value under our key sustainability themes, we havelisted specific business impacts, societal impacts, and KPIs.
• In terms of minimizing risks and securing opportunities, which we have focusedon thus far in our sustainability strategy, we will take stock of the risks andopportunities again across the entire value chain in an effort to generate positive
impacts through our products and services.
• Heightening consumer awareness of sustainability-related considerations is a
crucial megatrend to watch, and it is clear that new value propositions aimed atmeeting growing demand relating to ethical consumption and so on are set tobecome increasingly important up ahead. Our policy will be to continue building
4business models in which helping to address societal issues will also contribute tobusiness growth.
◆ Digital Transformation Strategy （P8）• The Asahi Group’s digital transformation, is not merely about digitalization, but amanagement reform initiative that is crucial for our survival. We consider digitaltransformation to mean business transformation. We intend to push ahead with
innovation in the three key areas of processes, organization, and business models.
• With regard to process innovation, we will be investing more than 30 billion yen
over the next three years and building a data platform to gather, store, and utilize
data from inside and outside the Group. Also, to avoid data degradation, we will
look to improve our data management processes in order to constantly maintainand improve data quality at a global level.
• With regard to organizational innovation, we will transform the Group into a“digital native” organization that is data-driven and agile, and also strengthen
incubation functions. Although we are already moving ahead with training our own
data analysts and other specialist personnel, we will also be coordinating morewith external organizations.
• As for business innovation, we will work on building new business models withmore emphasis on personalization so that we can respond to increasing wellbeing-related demand. Also, we will promote innovations that involve the buildingof mechanisms for the provision of information to enhance product value, as wellas the provision of product and experiential value tailored to people’s physical ormental conditions.
◆ R&D Strategy （P9）• In order to respond to changing conceptions of well-being and contribute tosocietal sustainability while also achieving business growth, it is vital that we not
only increase the value of our existing products, but that we also never cease intackling the creation of new products and markets.
• In line with our R&D strategy, we will work on creating new value and developing
products and technologies designed to mitigate risk in four areas: alcohol, health& wellness, sustainability, and new business.
• With focus on these four areas, we will actively invest in nurturing humanresources and attracting talent from outside the Group to further enhance ourcapabilities. At the same time, we will employ artificial intelligence and otheremerging technologies and also promote open innovation, including collaboration
with universities and startups.
• We also aim to develop products and technologies that harness our strengths inyeast and lactic acid bacteria, for example, and generate new value propositions
in beer adjacent categories and new business fields.

5◆ Enhancement of Human Capital （P10）• We will look to enhance the effectiveness of our medium- to long-term strategies
by synchronizing and advancing initiatives aimed at fostering an ideal corporate
culture through the continued nurturing of future management team members,
securing the new capabilities and personnel that the Asahi Group requires, andincreasing diversity, equity and inclusion in our workplaces.
• More specifically, following the establishment of our People Statement in March oflast year, we formulated a Global Diversity, Equity and Inclusion Statement as afurther step towards fostering an ideal corporate culture and boosting employee
engagement under the core message of “shine as you are.”• By enhancing human capital with a view to building an ideal business portfolio andexecuting core strategies, we hope to create a virtuous cycle that further drives
our practice of the Asahi Group Philosophy and the execution of our medium- tolong-term strategies.
◆ Key Medium-Term Strategies for Each Regional Headquarters （P11）• As the company overseeing the three businesses in Japan, Asahi Group Japan will
pursue the optimization of product portfolios in each business and the creation ofsynergies between all domestic businesses.
• In Europe, we will continue to reinforce the premium strategy centering on our
five global brands and market-leading local brands, while in Oceania the pillars of
our growth strategy are the promotion of a multi-beverage strategy hinging onstrengths in both alcohol and non-alcohol beverages and the generation of
integration synergies.
• Also, so that we can respond to consumer’s changing conceptions of well-being ineach region, we will push ahead with efforts to create added value in beeradjacent categories and other categories, proactively increase our use ofrenewable energy, deliver new value propositions with emphasis on sustainability,and pursue supply chain management reforms.
• Under the global framework of four regional headquarters that we haveestablished, our plan is to share best practices across the entire Group and build awell-balanced business portfolio.
◆ Expansion of Global Brands （P12）• Up ahead, by expanding our market presence, we are targeting an average total
annual growth rate of around 10% for the five global brands of Asahi Super Dry,
Peroni Nastro Azzurro, Kozel, Pilsner Urquell, and Grolsch.
• In particular, for Asahi Super Dry and Peroni Nastro Azzurro, which we havedesignated as top-priority super premium brands, we are targeting industryleading sales volume among global premium beer brands.
• We have already globally standardized the tone and manner of branding and we6are currently building a framework with which to communicate a unified world
view regardless of region.
• Along with the launch of new extension products, we have gained an ideal
opportunity to promote Asahi Super Dry to premium beer drinkers around theworld by becoming the first Asian corporation to be named as a worldwide partner
for the 2023 Rugby World Cup.
• We will continue to work on the expansion of our five global brands as a pillar of
our growth strategy in an effort to drive Group-wide growth.
◆Medium-Term Guidelines for KPIs （P13）• After temporarily withdrawing our KPI guidelines in response to the impact of the
COVID-19 pandemic, we now are aiming for average annual growth of Core Operating
Profit and earnings per share in the high single digits, with 2021 results as the basepoint.
• Although we face such risk factors as further prolongation of the pandemic and rising
raw materials costs, we will advance our growth strategy for each business based on
our new Medium- to Long-term Management Policy as we seek to securely lock in therecovery trend in 2022 and beyond.
• As for free cash flow, a newly adopted KPI, we will strive to generate annual flows ofat least 200 billion yen on average. When allocating these funds priority will be given
to debt reduction to expand our capacity for future growth investment.
◆Medium-Term Guidelines for Financial Policy (P14)• Our Medium-Term Financial Policy is unchanged. We aim to reduce the Net Debt-toEBITDA ratio to around three times or less by 2024 and provide shareholders withstable dividend increases aimed at achieving a dividend payout ratio of around 35%.
◆Restructuring of Supply Chain Management in Japan (Alcohol and Nonalcohol Beverages Businesses) （P15）• Based on our updated Medium- and Long-Term Policy and in consideration of themedium- to long-term market outlook and megatrends, we have decided torestructure the supply chain management system serving our Alcohol and Non-alcohol
Beverages Businesses.
• This restructuring has three main focuses. The first is to bolster our responsiveness toa changing business environment, including increasingly diversified needs. The second
is to increase our cost-competitiveness. The third is to accelerate the implementationof our sustainability strategy, through which we aim to become carbon negative assoon as possible.
• Specific measures include ceasing operations at Asahi Breweries’ Kanagawa Brewery
and Shikoku Brewery in January 2023. In 2024, the production facilities of Nikka
Whisky’s Nishinomiya Plant will be transferred to Asahi Breweries’ Suita Brewery, andthe adjacent Nishinomiya-Higashi Distribution Center will cease operations. In
addition, from 2026 we plan to shift operations at the Hakata Brewery to a new7

brewery with a next-generation production system that will serve as a model facility
for the Asahi Group’s other production facilities.
◆Overview of Shin-Kyushu Brewery (tentative name) （P16）• This new brewery will feature next-generation technologies and produce multiple
product types, including soft drinks, and multiple container types. In addition to the
optimized production and distribution system created through hybridization and theadoption of new technologies, the new brewery will be a state-of-the-art facility with
CO2 capture and carbon recycling technologies.
• We also will be further enhancing the operational efficiency of all Asahi Breweries’
facilities by establishing a central team to support production operations and theconsolidation of facilities, and promote the standardization of operations that have
until now been managed separately at each individual production facility.
• We expect these initiatives to generate an annual cost efficiency benefit totaling 3
billion yen by 2026 after adjusting for increases in logistics costs and certain otherexpenses. We also expect them to contribute to the creation of a model that will leadto further optimization of our supply chain management system.
◆Revenue/Core Operating Profit (2021 Results) （P17）• Looking at our 2021 results on a constant currency basis as shown on the left side ofthis table, revenue increased 6.1% year on year as revenue growth in the Overseas
Business supported by the impact of the consolidation of CUB and a recovery in onpremise sales offset a decrease primarily in on-premise revenue at our Alcohol
Beverages Business.
• Core Operating Profit increased 23.1% year on year, as the decline in profit from the
Alcohol Beverages Business was more than offset by the recovery of the Non-alcohol
Beverages Business and profit growth in the Overseas Business driven by the
consolidation of CUB and channel mix improvements.
◆Revenue/Core Operating Profit (2022 Forecast) （P18）• Our 2022 forecast, shown in this table, reflects a change in our reportable segments.
In conjunction with the establishment this January of Asahi Group Japan as theregional headquarters for our businesses in Japan, from this year we are disclosing
financial results for four regional headquarters.
• Starting with revenue, we are aiming for year-on-year growth of 10.5%. We think thisgrowth will be supported primarily by a certain degree of recovery in demand from theon-premise channel and accompanying improvements in our channel mix.
• As for Core Operating Profit, we are aiming for an 11.4% increase. In addition to theimpact from the rising cost of raw materials mentioned earlier, higher utilities andlogistics expenses are expected to push up Group-wide costs by about 40 billion yen.
Nonetheless, we think various mix improvements and stronger cost management will
enable us to increase profit.
◆Operating Profit/Profit Attributable to Owners of Parent （P19）• Next let’s look at operating profit. Despite posting business integration expenses and8

an impairment loss, operating profit was generally in line with targets, up 56.8% year
on year to 211.9 billion yen. Profit attributable to owners of parent was up 65.4% to153.5 billion yen.
• The right side of this table shows our 2022 forecasts. We expect that the increase inCore Operating Profit will more than cover expenses associated with supply chain
management restructuring in Japan and business integration costs. We therefore
forecast that operating profit will increase 2.6% year on year to 217.5 billion yen.
• We project a 4.6% decrease in profit attributable to owners of parent. However, after
excluding the loss related to supply chain management restructuring, adjusted profit
attributable to owners of parent comes to 156.5 billion yen, a year on year increase of
1.2%.
◆Statement of Financial Position/Statement of Cash Flow （P20）• Total assets at the end of 2021 were 4,547.7 billion yen, an increase of 108.4 billion
yen from the end of 2020, largely reflecting increases in goodwill and trademark
rights.
• We reduced outstanding interest-bearing debt much more than initially targeted. In
addition to the increase in Core Operating Profit, we were able to use cash generated
through a reduction of working capital and the sale of non-operating assets to bringdebt down. In 2022, we expect to generate free cash flow of 215.0 billion yen andwith prioritization of debt repayment we anticipate a Net Debt-to-EBITDA of around3.6 times.
• Also, in line with our policy of stably increasing the annual dividend and maintaining apayout ratio of at least 35%, we plan to increase the annual dividend for 2022 by 2
yen per share, which will bring it to 111 yen.
◆Sales Trend by Region （P21）• The spread of Omicron infections from November has made it difficult to predict the
pandemic’s impact on our business in 2022. However, we are seeing restrictions being
relaxed in many countries and expect the on-premise market to stage a recovery
during 2022.
• That said, considering the possibility of unforeseen continued negative impacts fromthe pandemic, we will flexibly revise our plan as needed and disclose any revisions ina timely manner.
◆Japan: Overview and Direction （P22）• Last year, the Alcohol Beverages Business had to deal with an unexpectedly severe
and prolonged contraction of the on-premise market but nonetheless managed to put
sales momentum back on a recovery track by prioritizing investment in its core
brands and categories while also launching sales of Asahi Super Dry Nama Jokki Can
and opening up the new minimal alcohol market.
• This year we are conducting a “full renewal” of Asahi Super Dry and will also further
strengthen investment in brands, such as Asahi Super Dry Nama Jokki Can and Asahi
Nama Beer “Maru F”, which have the potential to stimulate off-premise demand. I’ll
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provide some more details on this later.
• In addition, as I explained earlier, we aim to build a strong profit base throughfundamental structural reforms, such as the restructuring of our supply chain
management based on our analysis of medium- to long-term megatrends.
• Last year, in the Non-alcohol Beverages Business revenue fell short of targets owing
to the prolonged impact of the pandemic. However, product category mix
improvements focused on carbonated soft drinks and such efficiency improvements asraising capacity utilization rates enabled the business to return its Core Operating
Profit to pre-pandemic levels.
• This year, we expect to be challenged by considerable increases in raw materials
costs, but we will focus on expanding our product portfolio by developing productsthat meet evolving consumer needs, including environment-friendly products, while
also continuing to invest in our core brands.
• Turning to the Food Business, in 2021 we managed to achieve revenue and profit
growth above targets. While the recovery in sales of Mintia brand products came up a
bit short, we succeeded in expanding sales of core brands that are capturing new
demand: for example, Amano Foods, Ippon Manzoku Bar, and Dear-Natura.
• This year, in addition to strengthening Mintia sales through new value propositions
and expanding sales of other core brands, we will strive to further improve thebusiness’s profitability through optimizing inventory levels and other initiatives.
◆Beer Initiatives （P23）• As shown in the POS data graph on the lower right of this slide, off-premise market
beer sales have rebounded steadily since Japan’s liquor tax revision in October 2020.
With further liquor tax revisions scheduled for 2023 and 2026, we expect this trend tocontinue.
• In this environment, we achieved a 35% increase in Asahi Super Dry customers,
owing in part to the contribution from the launch of Asahi Super Dry Nama Jokki Can.
With contributions also coming from other products, including stronger than expectedsales of the newly launched Asahi Nama Beer “Maru F,” we were able to achieve acertain degree of progress toward a recovery in sales momentum.
• In 2022, we will conduct the first “full renewal” of Asahi Super Dry since its launch 35
years ago. While further enhancing the beer’s characteristic dryness, we will continue
refining the value of this one-of-a-kind beer brand in keeping with changing times.
• We have also boosted Asahi Super Dry Nama Jokki Can production capacity fourfold
and will make further improvements, such as increasing foaming speed, as we target
an increase in Asahi Super Dry Nama Jokki Can customers.
◆Smart Drinking Initiatives （P24）• Starting with the launch of Beery last March, we have been expanding our “smart
drinking” propositions, as we seek to provide people with a wider range of drinking
options suited to various situations and occasions.
10• As shown in the graph on the right side of this slide, Beery has contributed
significantly to the growth of the non-alcohol beer-taste beverages market without
cannibalizing sales of existing products.
• This January we established Smart Drinking Co., Ltd., as a joint venture with Dentsu
Digital, and will increase communication and marketing activities targeting people who
do not or cannot drink alcohol beverages.
• We plan to expand our product lineup and strengthen efforts to grow the minimal
alcohol category and seek further penetration of our “smart drinking” concept with theaim of encouraging people to respect each other’s choices about whether to drink or
not drink alcohol.
◆Europe （P27-29）• This slide provides a brief overview of results and activities in Europe in 2021. Tosummarize, investment in our core brands and continued strengthening of support forour business partners dealing with the lingering impact of the pandemic led to astrong recovery at the top line.
• As the next slide shows, improvement in the channel mix driven by a recovery in the
on-premise market combined with growth in sales of Asahi Super Dry, Peroni Nastro
Azzuro, and non-alcohol beer to the off-premise market led to a 7 percentage point
year-on-year improvement in the unit sales price.
• Meanwhile, we continue to face challenges, such as the creation of growth categories
in response to changing consumer needs and the reform of the European business’s
earnings structure in anticipation of rising costs.
• In 2022, we will respond to sharply rising costs by implementing flexible pricing
strategies and conducting optimal cost management, in addition to product mix
improvement associated with the recovery of the on-premise market. We will further
enhance revenue management and implement pricing strategies at appropriate times
in line with the situation in each country• Although Omicron infections have continued to increase in European countries in
2022, restrictions have not been tightened significantly, and we expect the businessenvironment to improve in the months ahead.
• Although the situation remains uncertain, we will continue to working to achieve ourtargets for 2022 by advancing our premium strategy and strengthening cost controls◆Oceania （P30-31）• To summarize last year’s results, we strengthened our competitive advantage by
creating integration synergies with CUB, and enhancing brand value particularly in ourcore brand categories.
• As the next slide shows, sales of our core Great Northern brand greatly exceeded
overall market growth by rising 12% year on year, as we expanded our share in theoff-premise market. Great Northern has become a key growth driver of the11contemporary beer category.
• In addition to cost synergies, top line growth was achieved by increasing the numberof stores selling Asahi Super Dry and Peroni Nastro Azzurro, which contributed to 6%
growth in the combined average sales volume of the two brands. Cross-selling of ouralcohol and non-alcohol beverages increased the number of on-premise outlets of
Alcohol Beverages handling non-alcohol beverages by 90% compared to the 2020
level.
• This year, we expect that the business environment in Oceania will remain challenging
owing to high raw materials prices and supply chain disruptions. We will endeavor tostrengthen our profit base by promoting our multi-beverage strategy, including
establishing revenue growth management in the Non-alcohol Beverage Business, andcreating integration synergies.
• In addition, we will strive to further strengthen our business foundation in Oceania by
optimizing supply chain, including expanding local production of some of our Asahi
Super Dry and Peroni Nastro Azzurro brand products.

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