English Translation of Original JapaneseThis is a translation of the original notice in Japanese. In the event of any discrepancy, the original
notice in Japanese shall prevail.

ASAHI GROUP HOLDINGS, LTD.
(Securities Code: 2502)
March 4, 2014
Dear Shareholders:

CONVOCATION NOTICE OF
THE 90th ANNUAL GENERAL MEETING OF SHAREHOLDERS
You are cordially invited to attend the Annual General Meeting of Shareholders of Asahi Group
Holdings, Ltd. (the “Company”), which will be held as described in the Particulars below.
If you can attend the meeting, please submit the enclosed voting form directly at the meeting.
If you are unable to attend the meeting in person, you may exercise your voting rights via
either postal mail or Internet. Please review the attached “REFERENCE MATERIALS FOR
ANNUAL GENERAL MEETING OF SHAREHOLDERS”, and exercise your voting rights
no later than 5:30 p.m., March 25 (Tuesday), 2014 (JST) by following the “Guide to
Exercising Voting Rights” on page 3.
Sincerely,
Naoki Izumiya,President and Representative Director
ASAHI GROUP HOLDINGS, LTD.
23-1, Azumabashi 1-chome, Sumida-ku, TokyoPARTICULARS
1. DATE AND TIME
March 26 (Wednesday), 2014, at 1:00 p.m. (JST)
2. PLACE
Banquet Room “Tsuru”, Main Banquet Floor of Hotel New Otani, 4-1, Kioi-cho, Chiyoda-ku, Tokyo(Please note that if Banquet Room “Tsuru” becomes full, you will be guided to another venue.)
3. PURPOSES
Items to Be Reported:
Business Report, Consolidated Financial Statements, Non-Consolidated Financial
Statements and reports of the audit results of the consolidated financial statements by
the Independent Accounting Auditor and the Board of Auditors for the 90th term, fromJanuary 1, 2013 to December 31, 2013.
Items to Be Resolved:
Item 1: Appropriation of surplus
Item 2: Election of nine (9) Directors
Item 3: Election of one (1) Corporate Auditor
1*Please see the additional notes on the following page.

On the day of the meeting, please submit the voting form at the reception desk. Please also bring this notice with you, to help us
preserve resources.
You are advised to arrive at the venue early, as the reception desk is expected to become extremely crowded immediately before
the commencement of the meeting. (The reception desk will open at 11:30 a.m.)
Please note that anyone other than a shareholder who is entitled to exercise voting rights (e.g., non-shareholding proxy, person
accompanying the shareholder) will not be allowed inside the venue.
Corrections to Reference Materials for Annual General Meeting of Shareholders, Business Report, Consolidated Financial
Statements, and Non-Consolidated Financial Statements, if any, will be posted on the Company’s website (*).
* http://www.asahigroup-holdings.com/

2

Guide to Exercising Voting Rights* The online voting site and Help Desk information are available only in Japanese.
Please exercise your voting right,
which is the right to participate in the Company’s management.
A voting right at the General Meeting of Shareholders is an important right that entitles
shareholders to participate in the Company’s management.
Please refer to the following and exercise your voting right by either method.
Attending the General Meeting of Shareholders in person
Please submit the voting form at the reception desk at the venue.
Not attending the General Meeting of Shareholders in person
Voting via Postal Mail
Please indicate your consent/dissent concerning the items shown on the voting form, and sendback the form so that it will arrive no later than 5:30 p.m., March 25 (Tuesday), 2014 (JST).
* If you submit a voting form without indicating your consent/dissent with respect to each item,
you will be deemed to have voted in favor of the Company’s proposal(s).
Voting via Internet
Online voting website: http://www.web54.net* If your smartphone or cellular phone is equipped with a barcode
reader, you may use the two-dimensional code at right in order toaccess the online voting website. For more detailed informationon that procedure, please refer to the user manual of yoursmartphone or cellular phone.
(1) Accessing the voting website
Online voting is available only by accessing the website noted above. This website may beaccessed from a computer, smartphone or cellular phone. (Please note that the connection feeswith the Internet service providers and communication fees, such as telephone bills, should beborne by the shareholders when using the online voting website.)(2) Entering your “voting code” and “password”
Enter the “voting code” and “password” indicated on the voting form. Then indicate yourconsent/dissent concerning each item by following the instructions displayed on the screen.
Please note that shareholders who received the Notice of the Annual General Meeting of
Shareholders for the fiscal year under review by e-mail will not find the “password” on theirvoting form. Such shareholders are asked to enter the “password” that they specified whenregistering their e-mail addresses.
Follow the instructions on the screen to cast your vote.
Shareholders who wish to receive the convocation notices of Annual General Meetings ofShareholders by e-mail beginning with the next meeting may so register on the e-mail address
registration website noted below. Please note that the site cannot be accessed via cellular phone.
E-mail address registration website: http://www.web5106.net

3

Deadline for Exercising Voting Rights via the Internet
No later than 5:30 p.m., March 25 (Tuesday), 2014 (JST)(Day before the Annual General Meeting of Shareholders)Q. What will happen if I exercise my voting right not only via postal mail but also via theInternet?
A. If you exercise your voting right in duplicate (i.e., voting online as well as voting by using
the voting form), only the online vote will be counted.
Q. I can exercise my voting right online more than once. Will all my voting attempts beconsidered valid?
A. If you exercise your voting right online more than once, only the most recent vote will becounted.

System Requirements for Online Voting
When voting online, please ensure that your system satisfies the relevant system requirements.
(1) Voting via PC or smartphone
Screen resolution of 800 (horizontal) x 600 (vertical) pixels (SVGA) or higher, Microsoft®
Internet Explorer Ver. 5.01 SP2 or newer as the browser software, and Adobe® Acrobat®
Reader® Ver. 4.0 or newer or Adobe® Reader® Ver. 6.0 or newer as the PDF file browser.
*If your browser's “pop-up Blocker” function, or a similar add-on, is enabled, please disable(or temporarily disable) this function.
(2) Voting via cellular phone
Internet connectivity via “i-mode”, “EZweb”, or “Yahoo!Keitai”, and compatibility with a
128-bit SSL (Secure Socket Layer) communication protocol (encrypted communication).
*While voting via cellular phones with full browser functionality is supported in principle,
we cannot guarantee compatibility with all available models.

Inquiries for Online Voting
Please contact the following Help Desk for inquiries about online voting.
Sumitomo Mitsui Trust Bank, Limited
Stock Transfer Web Support Phone No.
Toll-free (within Japan): 0120-652-031 (9:00 a.m. to 9:00 p.m.) (JST)* The online voting website and Help Desk information are available only in Japanese.

4

REFERENCE MATERIALSFOR ANNUAL GENERAL MEETING OF SHAREHOLDERS
Agenda Items and Reference Information
Item 1: Appropriation of surplus
The Company proposes the appropriation of surplus in the following manner:
1. Year-end dividends
As a holding company of the Group (the Company, its subsidiaries and its affiliates arecollectively referred as the “Group” or the “Asahi Group”), under the “Medium-Term
Management Plan 2015”, which began in the fiscal year under review, the Company is giving toppriority to utilizing free cash flows generated by the Company to fund investments in growth,
including expansion in our business networks worldwide. In terms of shareholder returns, given
the Company’s improved surplus investment funding position due to a stronger cash flow
generation capacity and an improved debt-equity ratio, the Company aims to steadily increase
dividends, targeting a dividend payout ratio of around 30% (25%-35%) by fiscal 2015. Efforts
will also be made to enhance total shareholder returns by targeting a total return ratio, including
share buybacks, of 50% or higher.
Based on the aforementioned policy and taking into consideration a variety of factors, including
the Company’s consolidated financial condition and achievement for the fiscal year under review,
the Company proposes a year-end dividend of ¥21.5 per share, as follows:(1) Type of dividend asset
Cash(2) Allocation of dividend assets to shareholders and total amount of allocation¥21.5 per share of common stock
Total amount of payout: ¥9,938,015,972
Since the Company previously paid out ¥21.5 per share as an interim-period dividend, the total
dividend for the fiscal year under review will amount to ¥43.0 per share, which is an increase of¥15.0 per share from the previous fiscal year.
(3) Effective date of dividend payment
March 27, 2014

5

Item 2: Election of nine (9) Directors
At the conclusion of this Annual General Meeting of Shareholders, the terms of office of all the
Directors will expire. The Company therefore asks the shareholders to elect nine (9) Directors.
The candidates for the position of Director are as follows. Among these, the candidates for
position for Outside Director meet the requirements for independent directors/auditors as
defined by the Tokyo Stock Exchange.
CandidatenumberName (Age)Naoki Izumiya (65)1Reappointment
Katsuyuki Kawatsura (63)2Reappointment

Position

President andRepresentative Director

Reappointment

Katsutoshi Takahashi (59)4Reappointment
Yoshihide Okuda (58)5Reappointment

Overall Group Management

10/10

Senior Managing
Director,
Senor Managing
Corporate Officer

Human Resources Section, Research &Development Section, Intellectual
Property Section, Group Food Business

10/10

Director,
Corporate Officer

Audit Section, Secretary Section,
Corporate Social Responsibility
Section, Lifestyle & Culture Section,
International Business Section, Group
Soft Drinks Business, GroupInternational Operations

10/10

Director,
Corporate Officer

Procurement Section, Production
Section, Logistics Section, Quality
Assurance Section

8/8

Director,
Corporate Officer

General & Legal Affairs Management
Section, Finance Section, Information
Technology Section

8/8

Director

Group Alcoholic Beverages Business

9/10

Shiro Ikeda (57)3

Responsibilities

Number of
Board ofDirectors
meetings
attended

Akiyoshi Koji (62)6Reappointment
Mariko Bando (67)7Reappointment

Outside Director

10/10Outside Director

10/10Outside Director

8/10

Candidate for Outside Director
Naoki Tanaka (68)8Reappointment
Candidate for Outside Director
Ichiro Ito (71)9Reappointment
Candidate for Outside Director
Notes:

1. The age, position and responsibility are as of this Annual General Meeting of Shareholders.
2. As candidates for Directors Katsutoshi Takahashi and Yoshihide Okuda were newly elected at the 89th Annual General
Meeting of Shareholders held on March 26, 2013, the number of Board of Directors meetings held since their
appointment is different from other candidates for Directors.

6

Candidate
numberName(Date of birth)
Age

Career summary and significant concurrent
positions held by the candidate

Number of

Number of shares
Notes toin the Company
owned by the Appointment
candidate

Board ofDirectors
meetings
attended

Apr. 1972 Entered the Company
Mar. 2000 Corporate Officer, Senior
General Manager of GroupManagement Strategy
Headquarters
Oct. 2000 Corporate Officer, Senior
General Manager of Strategy
Planning Headquarters
Sep. 2001 Corporate Officer, Deputy
General Manager of Shutoken
Regional Headquarters, General
Manager of Tokyo Branch
1

Naoki
Izumiya(August 9,1948)
65 years old

50,800Mar. 2003 Director
Mar. 2004 Managing Director
Mar. 2006 Managing Director, Managing
Corporate Officer, Senior
General Manager of Liquor Sales& Marketing Headquarters
Mar. 2009 Senior Managing Director,
Senior Managing Corporate
OfficerMar. 2010 President and Representative
Director(to the present)
Position: President and Representative Director
Responsibilities: Overall Group Management

7

Reappointment

10/10

Candidate
numberName(Date of birth)
Age

Career summary and significant concurrent
positions held by the candidate

Number of

Number of shares
Notes toin the Company
owned by the Appointment
candidate

Board ofDirectors
meetings
attended

Apr. 1975 Entered the Company
Mar. 2005 Corporate Officer, Senior
General Manager of Product &Technology Development
Headquarters
Oct. 2007 Corporate Officer, Senior
General Manager of Research &Development Headquarters for
Alcoholic Beverages
Jul. 2008 Corporate Officer, Senior
General Manager of Research &Development Headquarters
Mar. 2009 Managing Corporate Officer,
Senior General Manager ofResearch & Development
Headquarters

2

Katsuyuki
Kawatsura(October 1,
1950)
63 years oldMar. 2010 Managing Director, Managing
Corporate Officer, Senior
General Manager of Research &Development Headquarters

11,100

Reappointment

10/10

Mar. 2011 Managing Director, Managing
Corporate Officer, Senior
General Manager of Research &Development Headquarters,
Senior General Manager of
Production Headquarters
Jul. 2011 Managing Director, Managing
Corporate Officer
Mar. 2013 Senior Managing Director,
Senior Managing Corporate
Officer(to the present)<Significant concurrent positions>
Director of Asahi Food & Healthcare Co., Ltd.
Director of Wakodo Co., Ltd.
Director of Amano Jitsugyo Co., Ltd.
Director of Asahi Professional Management
Co., Ltd.
Position: Senior Managing Director, Senior Managing Corporate Officer
Responsibilities: Human Resources Section, Research & Development Section, Intellectual
Property Section, Group Food Business8

Candidate
numberName(Date of birth)
Age

Career summary and significant concurrent
positions held by the candidate

Number of

Number of shares
Notes toin the Company
owned by the Appointment
candidate

Board ofDirectors
meetings
attended

Apr. 1980 Entered the Company
Mar. 2009 Corporate Officer, Senior
General Manager of Marketing
Headquarters, General Manager
of Product Development
Department I
Sep. 2010 Corporate Officer, Senior
General Manager of Marketing
Headquarters

3

Shiro
Ikeda
(November
25, 1956)
57 years old

Jul. 2011 Director, Corporate Officer,
Senior General Manager ofMarketing Headquarters of Asahi
Breweries, Ltd.

5,100

Reappointment

Mar. 2012 Director, Corporate Officer of theCompany(to the present)<Significant concurrent positions>
Director of Asahi Soft Drinks Co., Ltd.
Director of Calpis Co., Ltd.
Position: Director, Corporate Officer
Responsibilities: Audit Section, Secretary Section, Corporate Social Responsibility
Section, Lifestyle & Culture Section, International Business Section,
Group Soft Drinks Business, Group International Operations

9

10/10

Candidate
numberName(Date of birth)
Age

Career summary and significant concurrent
positions held by the candidate

Number of

Number of shares
Notes toin the Company
owned by the Appointment
candidate

Board ofDirectors
meetings
attended

Apr. 1977 Entered Yoshida Kogyo K.K.
(current YKK Corporation)
May 1991 Entered the Company
Mar. 2008 Corporate Officer, Senior Deputy
General Manager of Production
Headquarters, General Manager
of Production Technology
Department
Jul. 2011 Corporate Officer, Senior Deputy
General Manager of Research &Development-Production
Headquarters, General Manager
of Production Strategy
Department of Asahi Breweries,
Ltd.
Mar. 2012 Corporate Officer, General
Manager of the Production
Section of the Company
4

Katsutoshi
Takahashi(September
24, 1954)
59 years old

Corporate Officer, Senior Deputy
General Manager of Research &Development-Production
Headquarters, General Manager
of Production Strategy
Department of Asahi Breweries,
Ltd.

6,000

Reappointment

Sep. 2012 Corporate Officer, General
Manager of the Production
Section of the Company
Corporate Officer, Senior Deputy
General Manager of Research &Development- Production
Headquarters of Asahi Breweries,
Ltd.
Mar. 2013 Director, Corporate Officer of theCompany(to the present)<Significant concurrent positions>
Director of LB Co., Ltd.
Position: Director, Corporate Officer
Responsibilities: Procurement Section, Production Section, Logistics Section,
Quality Assurance Section

10

8/8

Candidate
numberName(Date of birth)
Age

Career summary and significant concurrent
positions held by the candidate

Number of

Number of shares
Notes toin the Company
owned by the Appointment
candidate

Board ofDirectors
meetings
attended

Apr. 1978 Entered Konishiroku Photo
Industry Co., Ltd. (current Konica
Minolta, Inc.)
Sep. 1988 Entered the Company
Mar. 2010 Corporate Officer, General
Manager of Finance Department
Mar. 2011 Corporate Officer, General
Manager of Finance Departmentof the Company
Senior Managing Director of
Asahi Management Services Co.,
Ltd. (current Asahi Professional
Management Co., Ltd)

5

Jul. 2011 Corporate Officer, General
Manager of Finance Section of theCompany
Yoshihide
Okuda(January 3,
1956)
58 years old

Senior Managing Director of
Asahi Management Services Co.,
Ltd.

5,100

Reappointment

8/8

Sep. 2012 Corporate Officer in charge ofpromoting efficiency(administrative sections overall)of the Company
Senior Managing Director of
Asahi Professional Management
Co., Ltd.
Mar. 2013 Director, Corporate Officer of theCompany(to the present)<Significant concurrent positions>
President and Representative Director of
Asahi Professional Management Co., Ltd.
Position: Director, Corporate Officer
Responsibilities: General & Legal Affairs Management Section, Finance Section, Information
Technology Section

11

Candidate
numberName(Date of birth)
Age

Career summary and significant concurrent
positions held by the candidate

Number of

Number of shares
Notes toin the Company
owned by the Appointment
candidate

Board ofDirectors
meetings
attended

Apr. 1975 Entered the Company
Sep. 2001 Corporate Officer
Mar. 2003 Managing Director, Senior
General Manager of Planning
Division of Asahi Soft Drinks
Co., Ltd.

6

Akiyoshi
Koji(November 8,
1951)
62 years oldMar. 2006 Senior Managing Director,
Senior General Manager ofPlanning Division of Asahi Soft
Drinks Co., Ltd.
Mar. 2007 Managing Director, Managing
Corporate Officer of theCompany
Jul. 2011 Director(to the present)<Significant concurrent positions>
President and Representative Director of
Asahi Breweries, Ltd.
Position: Director
Responsibilities: Group Alcoholic Beverages Business

12

14,400

Reappointment

9/10

Candidate
numberName(Date of birth)
Age

Career summary and significant concurrent
positions held by the candidate

Number of

Number of shares
Notes toin the Company
owned by the Appointment
candidate

Board ofDirectors
meetings
attended

Jul. 1969 Joined staff of Prime Minister’s
OfficeOct. 1985 Councilor of Cabinet Secretariat
Jul. 1989 Director of Consumer Statistics
Division, Statistics Bureau,
Management and Coordination
AgencyApr. 1995 Vice-Governor of Saitama
Prefecture
Jun. 1998 Consul General of Brisbane,
Australia
Jan. 2001 Director General of Gender
Equity Bureau, Cabinet Office
Oct. 2003 Director of Showa Women’s
University(to the present)
7

MarikoBandoApr. 2007 President of Showa Women’s
University(August 17,
1946)

Mar. 2008 Director of the Company

67 years old―

Candidate for
OutsideDirector
Reappointment(to the present)(to the present)<Significant concurrent positions>
President of Showa Women’s University
Director of Showa Women’s University
Director of The Institute of Women’s Culture,
Showa Women’s University
Chairman of the Board of Rural Women
Empowerment and Life Improvement
Association
Number of years of service as Director:
6 years (at the conclusion of this Annual
General Meeting of Shareholders)
Position: Outside Director

Reasons for recommending Mariko Bando as a candidate for Outside Director
Mariko Bando has a wide range of knowledge as an educator in addition to her diverse experience inpublic administration. To provide the Company with the benefit of this experience and knowledge,
the Company thus recommends her election to the Board as an Outside Director.
Although Mariko Bando has not been involved in company management other than as an Outside
Director or an Outside Auditor, the Board has concluded that she will be able to perform her duties
properly as an Outside Director of the Company based on the reasons noted above.

13

10/10

Candidate
numberName(Date of birth)
Age

Career summary and significant concurrent
positions held by the candidate

Number of

Number of shares
Notes toin the Company
owned by the Appointment
candidate

Board ofDirectors
meetings
attendedJan. 1971 Senior Fellow of Kokumin Keizai
Research InstituteApr. 1997 President of the 21st Century Public
Policy InstituteApr. 2007 President of Center forInternational Public Policy Studies(to the present)
Mar. 2009 Director of the Company
8

Naoki
Tanaka(September 1,
1945)
68 years old(to the present)―

Candidate for
OutsideDirector
Reappointment<Significant concurrent positions>
President of Center for International Public
Policy Studies
Number of years of service as Director:
5 years (at the conclusion of this Annual
General Meeting of Shareholders)
Position: Outside Director

Reasons for recommending Naoki Tanaka as a candidate for Outside Director
Naoki Tanaka has a great deal of experience as a member of government councils and broad
knowledge as a specialist deeply versed in economic policy. The Company thus recommends hiselection to the Board as an Outside Director to provide the benefit of this experience and knowledge
to the management of the Company.

14

10/10

Candidate
numberName(Date of birth)
Age

Career summary and significant concurrent
positions held by the candidate

Number of

Number of shares
Notes toin the Company
owned by the Appointment
candidate

Board ofDirectors
meetings
attended

Apr. 1966 Entered Asahi Chemical Industry
Co., Ltd. (current Asahi Kasei
Corporation)
Jun. 2001 Director
Feb. 2003 Managing Director
Jun. 2003 Director, Primary Executive
Officer
Apr. 2006 Director, Vice President
Executive Officer
Apr. 2010 Chairman and Representative
Director
9

IchiroIto(July 6, 1942)
71 years old(to the present)

1,000

Candidate for
OutsideDirector
Reappointment

Mar. 2011 Director of the Company(to the present)<Significant concurrent positions>
Chairman and Representative Director of
Asahi Kasei Corporation
Number of years of service as Director:
3 years (at the conclusion of this Annual
General Meeting of Shareholders)
Position: Outside Director

Reasons for recommending Ichiro Ito as a candidate for Outside Director
Ichiro Ito would bring a wealth of company management experience and insight into a broad range ofissues to the management of the Company. The Company thus recommends his election to the Board
as an Outside Director.

Notes:
1. None of the candidates for Directors has any special interest in the Company.
2. Regarding agreements limiting the liability of Outside Directors
To enable him/her to contribute fully in his/her role as an Outside Director, the Company has enteredinto agreements with Mariko Bando, Naoki Tanaka and Ichiro Ito that limit his/her liability fordamages as prescribed in Paragraph 1, Article 423 of the Companies Act. Under the terms of these
agreements, their respective liabilities are limited to ¥20 million or to the minimum limited amountstipulated by applicable laws and regulations, whichever is higher. If this agenda item is approved assubmitted, the current agreements will be extended.

15

8/10

Item 3: Election of one (1) Corporate Auditor
Corporate Auditor Takahide Sakurai passed away on January 3, 2014. The Company therefore
asks the shareholders to elect one (1) Corporate Auditor.
The candidate for the position of Corporate Auditor is as follows. A candidate for Outside
Corporate Auditor Katsutoshi Saito meets the requirements for independent directors/auditors as
defined by the Tokyo Stock Exchange.
This proposal is submitted with the prior consent of the Board of Auditors.

Number of
Name(Date of birth)
Age

Career summary and significant concurrent positions heldby the candidate

shares in the
Company
owned by theNotes toAppointment

candidate

Apr. 1967 Entered The Dai-ichi Mutual Life
Insurance Company (current The Dai-ichi
Life Insurance Company, Limited)
Jul. 1994 Director
Apr. 1997 Managing Director
Apr. 2001 Senior Managing Director
Apr. 2003 Representative Senior Managing Director
Jul. 2004 President and Representative Director
Apr. 2010 Deputy Chairman and Representative
Director
Katsutoshi
Saito(Dec. 6, 1943)―

Jun. 2011 Chairman and Representative Director(to the present)

Candidate for
OutsideCorporate
AuditorNew candidate

70 years old<Significant concurrent positions>
Chairman and Representative Director of The Daiichi Life Insurance Company, Limited
Outside Director of Imperial Hotel, Ltd.
Outside Corporate Auditor of Tokyu CorporationReasons for recommending Katsutoshi Saito as a candidate for Outside Corporate Auditor
Katsutoshi Saito would bring a wealth of company management experience and insight into a broad
range of issues to the management of the Company. The Company thus recommends his election as
an Outside Corporate Auditor.

Notes:
1. The age is as of this Annual General Meeting of Shareholders.
2. The candidate for Corporate Auditor has no special interest in the Company.
3. Regarding agreements limiting the liability of Outside Corporate Auditor
If this agenda item is approved as submitted, the Company plans to newly enter into an agreement with
Katsutoshi Saito that limits his liability for damages as prescribed in Paragraph 1, Article 423 of theCompanies Act in order to enable him to contribute fully in his role as an Outside Corporate Auditor.
Under the terms of this agreement, such liability will be limited to ¥20 million or to the minimum
limited amount stipulated by applicable laws and regulations, whichever is higher.
16

(Reference) CSR Activities of the Asahi Group
Living in harmony with the global environment and passing on this heritage to thenext generation are important missions for the Asahi Group, which conducts businessactivities that make use of the gifts of nature, such as water and grain.:
The Company, as a whole, is proactively working on CSR activities.
■ Support for the Great East Japan Earthquake Reconstruction
The Asahi Group continues the supports to address the needs of the areas affectedby the earthquake in accordance with three specific themes; namely “support for theenvironment”, “support for community revitalization” and “support for economic
stimulation”.
<Description of major activities>- Activities in Higashi-Matsushima City, Miyagi Prefecture
Since 2012, the Asahi Group has participated in the “Project of Mori no Gakkou”(school in a forest) established by Higashi-Matsusima City and supported by the
C.W. Nicol Afan Woodland Trust to build “Mori no Gakkou” (school in a forest)
that capitalizes on the natural environment in the region as part of the reconstructionof schools damaged by the Great East Japan Earthquake. The “Tree House”,
symbolizing “forest development for reconstruction” and was underway in thevicinity of the site where “Mori no Gakkou” is due to be built, was completed inJune 2013. The Asahi Group is supporting the construction of schools for childrenthat bring happiness and inspire dreams.

17

- Event to Support Evacuees Displaced from Fukushima Prefecture
In order to liven up evacuees displaced from Fukushima Prefecture as a result of
the Great East Japan Earthquake who are living in uncertainty, a community event
named “Koccha Kitara Iibee (come and join us)” was held in collaboration with
non-profit organization “Medical Network Support Center” in June at the Head
Office of the Asahi Group. Evacuees displaced mainly from Fukushima Prefecture
to the Tokyo Metropolitan Area were invited to the event which provides
oppotunities such as to receive a hand massage and make alcohol-free cocktails
using Asahi Group’s products.

- Joint Initiatives with the Reconstruction Agency
In order to enhance the management capabilities of local companies affected by
the Great East Japan Earthquake and build communities that are the key to thesustained growth of regional economies, the Reconstruction Agency and financial
institutions create regional reconstruction matching opportunities, called “Yui noBa”. The events, “Yui no Ba: Corporate Marché” were held at the Head Office of
the Asahi Group jointly with Ishinomaki City, Iwate Prefecture in June, and with
Kesennuma City, Miyagi Prefecture in November, where local companies
showcased and sold their products. Also, since April, Asahi Breweries, Ltd. has
been cooperating in regional reconstruction by dispatching its employee via the
Reconstruction Agency to “Higashimatsushima Mirai Toshi Organization”, which
was established for the purpose of bringing together citizens, public administrationand local private companies.

18

■ Environmental Education at Asahi Breweries, Ltd.
On an annual basis, Asahi Breweries, Ltd. plans and holds the “Educational
Seminar for Wakamusha (Young Samurai) who protect Japanese environment”, anenvironmental education program targeted at high school students. This year, teamsof students from seven high schools in East Japan who passed the first round of
essay screening prepared activity plans to improve regional environmental issues
through on-site learning and implemented their respective plans after returning
home. Asahi Breweries assists in human resources development for the next
generation through this environmental education activity.

■ Delivering Lectures by Calpis Co., Ltd.
Calpis Co., Ltd. operates the “Children Lactobacillus Research Institution of
Calpis”, which involves delivering lectures to elementary school children tocommunicate the importance of food based on the theme “lactobacillus andfermentation” and explore the possibilities of creating new things from scratch aswell as dreams about the future through discussions with Calpis employees serving
as lecturers. This program was highly evaluated for its program content and lesson
format that emphasizes communication between Calpis employees and children,and then it won the grand prize in the category of “educational CSR activities
chosen by junior high school and high school students” at the “Educational CSR
Symposium 2013”.

19

■ Childcare Support by Wakodo Co., Ltd.
Since March, in collaboration with Aoba Ward, Yokohama City, Wakodo Co.,
Ltd. has started giving free classes aimed at supporting childcare in the Regional
Care Plaza directly connected to Tama-plaza Station of the Tokyu Den-en-toshiLine. While utilizing its expertise gained from holding nutrition consultation
sessions given by employees who are qualified nutritionists and operating achildcare support center called “Wako-chan Hiroba”, Wakodo held classes such as“Weaning Food Seminar” targeted at parents with babies under the age of one,which lectures on the progress of weaning food according to their age in months
and “Postnatal Preparation Classes for Mothers/Fathers-to-be”, where participants
experienced to prepare milk powder formula, etc., which were well received.

20

BUSINESS REPORT
From January 1, 2013 to December 31, 2013

1. Overview of Operations of the Asahi Group(1) Business Progress and Results
During the fiscal year under review, the global economy overall recovered at amodest rate as demand in the private sector remained robust on the back of the recoveryof the housing market and the increase in the number of employees in the U.S., eventhough factors such as the impact of the continuation of sovereign debt problems in
Europe and government expenditure cuts in the U.S. remain.
The Japanese economy was on a modest recovery trend, as reflected in the
expansion of personal consumption and the increase in exports and public investments,
etc. amid the continuation of the yen depreciation and high stock prices stemming fromexpectations of economic recovery due to the economic policies of the government andmonetary easing of the Bank of Japan among other factors.
Against this backdrop, the Asahi Group worked on enhancing its corporate value
by promoting “Value and Network Management” from the fiscal year under review,which is the first year of “Medium-Term Management Plan 2015”. In Value andNetwork Management, the Asahi Group promoted initiatives aimed at attaining longterm stable growth by further expanding its domestic and overseas networks, in addition
to focusing on the “strengths” that it developed and acquired over the years, such as its
brands, technologies and cost competitiveness, and leverage them for the creation of
new values and innovation. Giving utmost priority to growth of its sales and profit, theGroup has worked together for the continual increase in key performance indicators
ROE (return on equity) and EPS (earnings per share) by improving capital efficiency
through such means as increase of shareholder returns.
As a result, the Asahi Group posted net sales of ¥1,714,237 million, a year-on-yearincrease of 8.6%. Operating income increased by 8.3% year-on-year to ¥117,467
million, and recurring profit rose by 7.7% to ¥123,612 million. Net income totaled¥61,749 million, an increase of 8.0% compared with the previous year.
The following provides an overview of the Group’s operations by business segment
for the fiscal year under review.

21■ Business performance of the Asahi Group22

International Operations Segment
Asahi Holdings (Australia) Pty Ltd
Schweppes Australia Pty Limited
Independent Liquor (NZ) Limited
Asahi Premium Beverages Pty Ltd
The Better Drinks Co Limited
Mountain H2O Pty Ltd
Asahi Beer (China) Investment Co., Ltd.
Beijing Beer Asahi Co., Ltd.
Yantai Beer Tsingtao Asahi Co., Ltd.
Shandong Asahi Green Source Hi-Tech FarmCo., Ltd.
Shandong Asahi Green Source Milk Products
Co., Ltd.
Asahi Group Holdings Southeast Asia Pte.
Ltd.
Permanis Sdn. Bhd.
PT. Asahi Indofood Beverage Makmur
Asahi Beer U.S.A., Inc.
Buckinghamshire Golf Co., Ltd.
and others.

Company-wide (Common)
Asahi Group Holdings, Ltd.
Asahi Professional Management Co., Ltd.
and others.
Alcoholic Beverages Segment
Asahi Breweries, Ltd.
The Nikka Whisky Distilling Co., Ltd.
Asahi Draft Marketing, Ltd.
Asahi Food Create, Ltd.
Asahi Beer Malt, Ltd.
Asahi Beer Feed Co., Ltd. / Masuda Co., Ltd.
Sainte Neige Wine Co., Ltd.
Satsumatsukasa Shuzo Co., Ltd.
Hokkaido Nikka Service Co., Ltd.
Sendai Nikka Service Co., Ltd.
and others.
Soft Drinks Segment
Asahi Soft Drinks Co., Ltd.
Calpis Co., Ltd. / LB Co., Ltd.
Asahi Calpis Beverage Co., Ltd.
Asahi Orion Calpis Inryo Co., Ltd.
Calpis Foods Service Co., Ltd.
and others.

Other Businesses Segment
Asahi Logistics Co., Ltd.
East Japan AB Cargo Co., Ltd.
West Japan AB Cargo Co., Ltd.

Foods Segment
Asahi Food & Healthcare Co., Ltd.
Wakodo Co., Ltd.
Amano Jitsugyo Co., Ltd.
Nippon Freeze Drying Co., Ltd.
and others.

<Target companies as of December 31, 2013>23

Overview by Business Segment for 90th Term
■ Asahi Group Breakdown of Net Sales

Segment

Million yen, except percentagesth

90 term
2013

89th term
2012(under review)

Change inamountChange inpercentage

Alcoholic Beverages¥922,249¥925,878¥3,6280.4%

Soft Drinks

370,836

461,054

90,217

24.3

Foods

101,626

106,240

4,613

4.5

International Operations

157,932

192,034

34,102

21.6

Other Businesses

26,431

29,029

2,597

9.8

Total

1,579,076

1,714,237

135,160

8.6

Note: The above figures exclude intra-Group sales.

The alcoholic beverages business segment posted net sales of ¥925,878 million, up
0.4% from the previous year, due in part to the year-on-year increase in the sales
volume of beer-type beverages for the first time in twelve years as well as the year-onyear increase in the sales volume of whisky and other spirits. Operating income rose by
0.4% from the previous year to ¥113,743 million, as a result of efforts to reduce fixed
costs overall especially depreciation, despite the increase in raw materials costs
stemming from the impact of the yen depreciation and other such factors, on top of
aggressive investments in advertising and sales promotion expenses.
Premium - Gift” substantially exceededplanned sales, and stores that carry“Asahi Super Dry Extra Cold” increased
significantly due to the introduction ofcompact dispensers. Furthermore, as aresult of strong performance of “Clear
Asahi Prime Rich” in the new genre(malt-type) category released in March aswell as an increase from the previous
year in sales of “Asahi Style Free”, the-Asahi Breweries, Ltd.
Asahi Breweries, Ltd. worked on
developing products that accuratelyreflect potential customer needs andmarket trends with the aim of becoming acompany that is “selected” by customers.
In the beer-type beverages sector, in
its beer segment, the brand power of“Asahi Super Dry” was enhanced aslimited gift set sales of “Super Dry – Dry24

first carbohydrate-free happoshu, thesales volume of beer-type beverages as awhole increased from the previous year.
Consequently, share* in the market ofbeer-type beverages expanded, boasting
the largest market share for the fourthconsecutive year.

In the alcohol-taste beverages sector,
sales volume overall increased from theprevious year as a result of efforts tostrengthen and develop the brand of thebeer-taste beverage “Asahi Dry Zero”,
including conducting large-scale
sampling activities and renewal of theformula to realize “creamy foam”,“calorie-free” and “carbohydrate-free”
beverage.
In terms of earnings, Asahi
Breweries endeavored to reducepackaging materials costs, in addition to
reducing fixed costs overall, especiallydepreciation.

In the sector of alcohol beverages
other than the beer-type bevarages, sales
increased overall from the previous year
despite a decrease in sales of shochu andlow-alcohol beverages from the previous
year, thanks to the domestic sales ofwhisky and other spirits of BrownForman Corporation including “JackDaniel’s” and “Early Times” fromJanuary and solid performance ofimported wines.

beverages was calculated based on taxed* Share in the market of beer-type
shipment volume of the top five domestic beer
producers.

25

The soft drinks business segment posted net sales of ¥461,054 million, an increaseof 24.3% compared with the previous year, reflecting the performance of Calpis Co.,
Ltd., in addition to the increase in sales volume at Asahi Soft Drinks Co., Ltd. and LB
Co., Ltd. Operating income increased by 109.5% from the previous year to ¥15,457
million, primarily due to the collaborated synergies generated with Calpis Co., Ltd. andthe improved efficiency of fixed costs overall, especially advertising and sales
promotion expenses.
In order to raise the brand value of both “Asahi” and “Calpis”, the domestic softdrinks business of Calpis Co., Ltd. was shifted and integrated into Asahi Soft Drinks
Co., Ltd. in September, and a business platform was built for the growth strategies ofthe soft drinks segment as a whole and for pursuing higher profitability through efficient
marketing investments.

previous year and reached a record high.
In terms of earnings, Asahi Soft
Drinks enhanced efforts to reform its
earnings structure including streamlining
fixed costs overall, especially advertisingand sales promotion expenses, whilepursuing higher productivity.

-Asahi Soft Drinks Co., Ltd.
Asahi Soft Drinks Co., Ltd. hasendeavored to strengthen its businessplatform by enhancing the status ofexisting brands and proposing newvalues to accelerate growth, as well as byworking on a company-wide level toreform its earning structure.
In terms of product strategy that
forms the basis of its growth strategy,
Asahi Soft Drinks concentrated its
management resources on strengthening
and developing the brands “MITSUYA”,“WONDA”, “Asahi Juroku-Cha”, “Asahi
Oishii Mizu” and “Wilkinson”. Notably,
as a result of efforts to stimulate themarket such as the release of the first
Food for Specified Health Uses“MITSUYA CIDER PLUS” from“MITSUYA” in September, companywide sales volumes increased from the26

-Calpis Co., Ltd.
Calpis Co., Ltd. sought to further

materials and technologies and feedstuff
business which handles microbial

enhance the brand power of its flagshipbrand “Calpis” to firmly establish andproducts for livestock.
In terms of earnings, Calpis worked

solidify its status in the milk-based
beverages market.
Sales volume increased from theto improve its profitability throughcollaboration with the Group companies
and to streamline fixed costs overall,previous year due to efforts such as
renewal of mainstay products “Calpis
Water” and “Calpis Soda” in March, andespecially advertising and sales
promotion expenses.

release of the fruit-flavored “Calpis
Fruits Parlor” and saline-flavored “Calpis
Oasis” suitable for rehydration.
In addition to resuming sales of the“Calpis” brand in Thailand in theoverseas business, efforts were made to
direct marketing operations involving the
mail-order sales of functional foodproducts that utilize its proprietary-LB Co., Ltd.
LB Co., Ltd. strove to offer tocost reduction of raw materials, such as
sweeteners and packaging materials,
through consolidation of its suppliers andpromotion of group purchasing, and byimplementing a local production systemfor chilled soft drinks.

customers the added values of freshness
and enticing flavor characteristic ofchilled soft drinks through thedevelopment of products in its mainstay
categories of tea and soft drink.
Sales volume increased significantly
from the previous year, due in part to thestrong performance of “Ajiwai Calpis”
released in March, which is a tie-up
product with Calpis Co., Ltd., in addition
to bolstered efforts in the mainstay tea
category including releasing “Polyphenol
Oolong-cha”, the first Food for SpecifiedHealth Uses for one-liter carton tea
drinks.
In terms of earnings, LB streamlined
its production and logistics expenses by27

In the foods segment, Asahi Food & Healthcare Co., Ltd., Wakodo Co., Ltd. andAmano Jitsugyo Co., Ltd. steadily increased sales. Mainly as a result of the foregoing,
net sales rose by 4.5% from the previous year to ¥106,240 million. Operating income
increased by 34.1% from the previous year to ¥4,919 million, due primarily to the
reduction of production costs and streamlining of fixed costs such as advertising andsales promotion expenses.
-Asahi Food & Healthcare Co., Ltd.
Asahi Food & Healthcare Co., Ltd.
endeavored to realize growth andprofitability by generating uniquestrengths that its competitors cannot offer

Healthcare as a whole exceeded the level
recorded in the previous year, due to thesubstantial increase in overseas sales, etc.
In terms of earnings, Asahi Food &Healthcare also worked on the effective

and by working on “steady and soundgrowth”, “establishment of organizationand infrastructure capable of addressingchanges in customers” and “enhancementof corporate brand and reform ofcorporate culture”.
In the foods segment, breath mints“MINTIA” which utilized the “Calpis”
brand and confectionery series such as
candies performed well. In the healthcare

use of advertising and sales promotion
expenses and improving productivity by
reducing production costs, among others.

segment, sales increased due toaggressive advertising-linked sales
promotion activities for dietary
supplements “Dear-Natura” and skincare
product “Suhada Shizuku”. In the freeze
dry segment, sales of Asahi Food &28

-Wakodo Co., Ltd.
Wakodo Co., Ltd. sought to enhance the

In terms of earnings, Wakodo
worked to improve its profitability byprofitability of existing businesses anddevelop businesses that will serve as thepromoting the reduction of variable costs
such as production costs and distribution

next pillars in growth areas.
In its mainstay baby food segment,
Wakodo proposed new value such as

costs, as well as fixed costs overall,
despite the impact of the yen
depreciation.

releasing fruit puree “Kudamono
Tabeyo!” which emphasizes the textureof fruits. In the business for seniorcitizens, Wakodo endeavored to expand
the demand through expanding the
product line-up and measures to improve
product recognition on sales floors.
Consequently, overall sales of Wakodo
increased from the previous year.
-Amano Jitsugyo Co., Ltd.
Amano Jitsugyo Co., Ltd. worked toreinforce its business platform inaccordance with the basic policies of“increasing presence in the food market”,“reforming the earning structure”, and“creative company that enriches
customer life”.
In distribution sales operations,
Amano Jitsugyo’s mainstay freeze-driedproducts began to be carried incovenience stores, and there was anincrease in the number of mass retailers
that carry the Products, as well as in thenumber of newly adopted products.
Amano Jitsugyo has also been running

In terms of earnings, Amano
Jitsugyo streamlined production costs,
including reducing the time involved in
production processes and automatingprocesses partially, as well as reducing
materials costs.

antenna shop “Amano Freeze-Dried
Station” in Tokyo since March, andendeavored to raise awareness of the
Amano brand. As a result, overall salesof Amano Jitsugyo increased from theprevious year.
29

The international operations segment recorded net sales of ¥192,034 million, up
21.6% from the previous year, due to the solid performance of businesses in each region.
Although the Chinese business achieved profitability, operating loss increased by ¥692
million from the previous year to ¥4,565 million due to the increase in amortization of
goodwill, etc. as a result of the impact of exchange rates.
-Oceania Business Segment
In the Oceania business segment, theGroup sought growth as a comprehensive
beverage business encompassing both
soft drinks and alcoholic beverages
mainly through the generation of cost

In the soft drinks sector, aggressive
marketing activities were carried out forthe brands “Schweppes”, “Solo”, and“Pepsi” in the mainstay carbonateddrinks category, as well as in growthareas including strengthening the sales ofmineral water whose market is expanding,and releasing new tea product “Real Iced

synergy among the companies, inaddition to developing and nurturing thecore brands, such as those held by
Schweppes Australia Pty Limited, andconducting business in growth areas.

Tea Co.”. In the alcoholic beverages
sector, strengthening of brand power wassought by such means as renewal offlagship brands and release of new
products in the mainstay low-alcohol
beverage category. In the growth areas ofimported beer, cider (sparkling applewine) and craft beer, marketing activities
were carried out including strengthening
sales of “Asahi Super Dry”. As a result,overall sales of the Oceania businesssegment increased from the previous year.

30Furthermore, the Group endeavoredto generate synergies with groupmembers through promoting efficiency
improvements by consolidating anddecommissioning production anddistribution sites as well as joint
procurement of raw materials, etc., andconsolidated the sales organization forcommercial-use products targeted at
restaurants that handle alcoholic
beverages in the soft drinks business andalcoholic beverages business in Australia.
-China Business Segment

to improve profitability by increasing
productivity through the concentration of
production functions of the “Asahi”
brand in Beijing Beer Asahi Co., Ltd.

In the China business segment, theGroup sought to enhance its status in themarket by expanding sales of the “Asahi”
brand and aimed to improve quality andprofitability by further consolidatingproduction sites.
For the “Asahi” brand, sales volume
increased from the previous year,
especially in the market of commercialuse products, due to aggressively
engaging in sales activities on draft beerin kegs targeted at Japanese restaurants
and enhancing the sales structure in the
Shanghai area, which is a top priority
market, by transitioning to categorization
by business.
Furthermore, the Group endeavoredand reducing the costs of raw materials
such as aluminum cans at local
production sites.

31

-Southeast Asia Business Segment
In the Southeast Asia businessregions, in addition to releasing a new
product for its flagship carbonated drink

segment, efforts were made to expand thebusiness network in Southeast Asia bybrand “Mountain Dew”. It also released
canned coffee “WONDA” of the “Asahi”

building a business platform for the softdrinks business in Indonesia, in addition
to an increase in sales through thebrand in December. As a result, overallsales generated by Permanis Sdn. Bhd.
increased from the previous year.

strengthening of the main brands ofPermanis Sdn. Bhd.
Malaysian soft drinks company

Furthermore, efforts to improve
profitability were made by promoting
efficiency in the procurement of raw

Permanis Sdn. Bhd. engaged inaggressive marketing activities andmaterials such as sugar and aluminumcans.

enhanced its sales structure in urban

In the other businesses segment, net sales increased by 9.8% year-on-year to¥29,029 million, due to efforts to increase the contracts in logistics operations in general.
Operating income increased by 2.5% year-on-year to ¥622 million, due to theimprovement of efficiency of fixed costs associated with the transfer of the insurance
agency business.

32

(2) Financial and Profit/Loss Indicators

Net sales (million yen)

90th term
2013

87th term
2010

88th term
2011

89th term
2012(under review)

1,489,460

1,462,736

1,579,076

1,714,237

Operating income (million yen)

95,349107,190

108,437

117,467

Recurring profit (million yen)

101,142

110,909

114,821

123,612Net income (million yen)

53,08055,09357,18361,749

6.4

7.3

6.9

6.9

157,674

166,832

170,981

183,695

Earnings per share (yen)114.10118.36122.75135.73

Total assets (million yen)

1,405,358

1,529,907

1,732,187

1,791,555

Net assets (million yen)612,670643,798

726,879

827,4811,315.51

1,378.19

1,553.35

1,772.47

9.0

8.8

8.4

8.0

Operating margin (%)*1

EBITDA (million yen)*2

*2

Net assets per share (yen)ROE (Return On Equity) (%)*1*2

EBITDA is equal to the sum of operating income before amortization of goodwill, etc., anddepreciation.
Earnings per share is calculated based on the average total number of shares outstanding during theterm. Net assets per share is calculated based on the total number of shares outstanding at term-end.
The number of shares outstanding is exclusive of treasury stock.

(3) Capital Investment Activities
Consolidated capital expenditures in the year under review totaled ¥56,639 million,
the segment breakdown of which is as follows. A large portion of the capital
expenditures represented investments made to upgrade existing facilities and implement
energy conservation measures. In addition to these, Asahi Soft Drinks Co., Ltd. carriedout new construction and expansion work, etc. for the manufacturing facility for softdrinks at the Fujisan Plant in the amount of ¥4,098 million.
Amount of capital expenditure

Business segment(Million yen)

Alcoholic Beverages

15,283

Soft Drinks

22,540

Foods

2,914

International Operations

14,691Other Businesses

221

Company-wide (common)

987

Total

56,63933

(4) Financing Activities
The Company financed the capital investments detailed in item (3) above and othercapital requirements through loans from financial institutions and the issuance ofcommercial paper.
Funds required for companies’ businesses of the Asahi Group are primarilysourced by the Company.

(5) Status of Principal Lenders(As of December 31, 2013)

Outstanding balance

Lender(Million yen)

Sumitomo Mitsui Banking Corporation

44,447

Mizuho Bank, Ltd.

15,317

Sumitomo Mitsui Trust Bank, Limited

12,690

The Norinchukin Bank

12,500

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

8,700

Note: Mizuho Corporate Bank, Ltd., which was the Company’s principal lender, merged with Mizuho
Bank, Ltd. and changed its trade name to Mizuho Bank, Ltd. as of July 1, 2013.

34

(6) Management Perspectives

Long-Term Vision 2020
Striving to be a corporate group trusted around the world through the Kando offood (deliciousness, happiness and innovation)

Asahi Group Holdings, Ltd. has established “Long-Term Vision 2020” in orderto address the changes in the increasingly tough business environment and thediversification of stakeholder needs, together with the three-year “Medium-Term
Management Plan 2015” for the achievement of the Vision. Since fiscal 2013, theCompany has been seeking to enhance its corporate value by promoting “Value andNetwork Management”.
In “Value and Network Management”, the Company will focus on the“strengths” that it developed and acquired over the years, such as its brand,
technologies and cost competitiveness, and leverage them for the creation of newvalues and innovation. The Company will also seek to maintain long-term stable
growth by further expanding its domestic and overseas networks.
35

Giving utmost priority to growth of its sales and profit, the Group will work
together for the continual increase in key performance indicators ROE (return on
equity) and EPS (earnings per share) by improving capital efficiency through suchmeans as increase of shareholder returns.
Alcoholic Beverages Segment-Asahi Breweries, Ltd.
Asahi Breweries, Ltd. will seek to become a company that is “selected” bycustomers by developing brands and developing products that accurately reflectpotential customer needs and market trends, given that consumers’ purchasing behavior
is expected to dramatically change due to the consumption tax rate hike.
In the beer-type beverages sector, efforts will be made to strengthen mainstay
brands. Asahi Breweries will seek to further enhance the brand value of “Asahi Super
Dry” with further “evolution” of the flavor of “Asahi Super Dry” through theintroduction of sophisticated beer yeast management technologies, full-fledged
deployment changed from limited gift sets sales of “Asahi Super Dry – Dry Premium”
last year, and the renewal of “Asahi Super Dry – Dry Black –”. In the new genre (malttype) category, Asahi Breweries will seek to expand their sales volume through therenewal of “Clear Asahi” and “Clear Asahi Prime Rich”. Moreover, for the firstcarbohydrate-free happoshu (low-malt beer) “Asahi Style Free”, Asahi Breweries will
try to increase its presence in the market through conducting the sales promotion
activities by highlighting its product characteristics.
As for the non-beer sector, Asahi Breweries will work to foster and strengthen its
core brands in each category. Especially in regards to whisky and other spirits, Asahi
Breweries will aggressively transmit information on products such as “Taketsuru” and“Black Nikka Clear” of The Nikka Whisky Distilling Co., Ltd., which is celebrating its
80th anniversary, as well as “Jack Daniel’s” and “Early Times” of Brown-Forman
Corporation, and make an effort to raise brand awareness.
In the alcohol-taste beverages category, Asahi Breweries will continue to engage insampling activities focusing on sales floors and streets for beer-taste beverage “Asahi
Dry Zero” renewed last year and try to increase its presence in the market.
Further, Asahi Breweries will strive to reform its earning structure by reducing thecosts of can lids, cardboard and other packaging materials and utilizing the Group’s
distribution networks.

36Soft Drinks Segment-Asahi Soft Drinks Co., Ltd.

Asahi Soft Drinks Co., Ltd. will endeavor to further strengthen its businessplatform by working on “fostering strong brands” and “establishing a durable earning
structure”.
Asahi Soft Drinks will work to not only strengthen the brands “MITSUYA”,“WONDA”, “Asahi Juroku-cha”, “Asahi Oishii Mizu”, “Wilkinson” and “Calpis” tosolidify their positioning, but also foster new brands and deploy new products. In thevending machine business, Asahi Soft Drinks will work towards the achievement of
stable business performance by increasing per-unit sales based on improved efficiency.
Further, Asahi Soft Drinks will reform its earning structure by improving its
optimal production and logistics systems as well as the efficiency of advertising andsales promotion expenses, and by making efforts in the early creation of synergy effects
with the domestic soft drinks business that has been shifted from Calpis Co., Ltd. andintegrated into Asahi Soft Drinks.
-LB Co., Ltd.
Through the development of products in its mainstay categories of tea and softdrinks, LB Co., Ltd. will continue to offer to customers the added values of freshness
and enticing flavor characteristic of chilled soft drinks.
LB will seek to expand sales by strengthening initiatives at mass retailers, inaddition to continuing the aggressive deployment of products utilizing the Group’s
brands, focusing on “Bireley’s” and “Calpis”.
LB will also aim to reform its earning structure through making its demand-supply
adjustment capabilities more sophisticated and reduce production costs by further
promoting group purchasing.
Foods Segment-Asahi Food & Healthcare Co., Ltd.
Asahi Food & Healthcare Co., Ltd. will realize growth and profitability bygenerating unique strengths that its competitors cannot offer and by working on “steadyand sound growth”, “establishment of organization and infrastructure capable ofaddressing changes in customers” and “enhancement of corporate brand and reform ofcorporate culture”.
37

Asahi Food & Healthcare will release new products of breath mints “MINTIA” andenhance the lineup of dietary supplements “Dear-Natura” to accelerate last year’s
growth and expand sales. In the commercial-use food seasonings business, Asahi Food
& Healthcare will strengthen initiatives with clients in Japan and expand sales of major
products, while developing marketing and sales structure overseas.
Furthermore, Asahi Food & Healthcare will reinforce its research and development
structure to develop highly competitive products.
-Wakodo Co., Ltd.
Wakodo Co., Ltd. will increase the profitability of existing businesses and aim todevelop businesses that will serve as the next pillars in growth areas.
As regards to baby food for which Wakodo boasts the biggest share in the Japanesemarket, new products with added value which focuses on vegetables will be released in
the product line-up of the retort pouch “Goo-Goo Kitchen” and Wakodo will try tostimulate the market.
Wakodo will also strive to reduce fixed costs by optimizing its production systemand cutting raw materials costs by such means as group purchasing.
-Amano Jitsugyo Co., Ltd.
Amano Jitsugyo Co., Ltd. will manage business in accordance with the basic
policies of “increasing presence in the food market”, “reforming the earning structure”,
and “creative company that enriches customer life”.
In distribution sales operations, Amano Jitsugyo will enhance the lineup of its
mainstay freeze-dried miso soup, including deploying products in various price ranges.
In mail-order sales operations, efforts will be focused on selling products exclusively inthe mail-order sales channel, with the aim of acquiring new customers.
Moreover, Amano Jitsugyo will seek to improve productivity by executing
production processes partially in-house, and work to reduce costs from the productdevelopment stage.
International Operations Segment-Oceania Business Segment
In the Oceania business segment, Asahi Holdings (Australia) Pty Ltd—thesubsidiary overseeing the Oceania region—will play a leading role in seeking growth as
a comprehensive beverage business, which covers both soft drinks and alcoholic38

beverages, mainly through the generation of cost synergy among the businesscompanies in the region, in addition to developing and nurturing their core brands andconducting business in growth areas.
In the soft drinks business sector, the Group will strive to expand sales bystrengthening its presence in the soft drinks market as a whole by such means as
deploying new products in growth categories and reducing the sugar content of existing
carbonated drinks. In the alcoholic beverages business sector, the Group will proceed tofirmly establish the status of mainstay low-alcohol beverages and, at the same time,
establish a strong and sustainable business structure through proactive marketing
activities in growth areas including imported beers such as “Asahi Super Dry” and cider(sparkling apple wine).
Furthermore, the Group will realize a stable revenue base by pursuing the creationof synergies in the business as a whole, including the joint procurement of raw materials
and the optimization of functions of back office sections, in addition to continuing theestablishment of optimum production and logistics systems.
-China Business Segment
In the China business segment, the Group will aspire to improve quality andprofitability by enhancing the status of the “Asahi” brand in the market by increasing
sales, in addition to further promoting the consolidation of production sites.
The Group will continue to engage in highly specialized sales activities based on asales structure that distinguishes between different types of businesses organized lastyear focusing on the Shanghai area, which is a top priority market. In sales ofcommercial-use products, the Group will strive to increase the number of non-Japaneserestaurants that carry draft beer in kegs, in addition to making Japanese restaurants carrythem anew. In sales targeted at mass retailers, the Group will engage in management by
distinguishing each chain and store, and seek to enhance proposal-oriented sales
activities based on sales promotion plans.
Further, the Group will support the revenue base of the China business by working
to reduce production costs including cutting raw materials costs (e.g., malt) and energy
costs at local production sites.
-Southeast Asia Business Segment
In the Southeast Asia business segment, the Group will endeavor to expand thebusiness network in Southeast Asia by building a business platform for the soft drinks
business in Indonesia, in addition to increasing sales through the strengthening of themain brands of Permanis Sdn. Bhd.
39

In Malaysia, the economic environment is expected to become harsh due to theintroduction of the goods and services tax scheduled in 2015. With this in mind,
Permanis Sdn. Bhd. will pursue sales expansion by engaging in activities to boost the
product appeal of “WONDA” released last year based on joint development with theCompany, through TV commercials, sampling, etc., as well as by enhancing flagshipbrands including carbonated drink “Mountain Dew”. Efforts will also be made to reduce
distribution costs by optimizing delivery routes, in addition to cutting raw materials
costs through weight reduction of can lids and PET bottles.
In Indonesia, the joint venture with the Indonesian company PT. Indofood CBP
Sukses Makmur Tbk will increase its presence in the market by improving the productrecognition of “ICHI OCHA GREEN TEA” released last year and by releasing products
in new categories such as coffee. Cost competitiveness will be ensured by developing a
production system based on the operation of an in-house factory. Furthermore, sales of
the “Pepsi” brand will be enhanced and the platform of the “Club” brand mineral waterbusiness will be utilized to establish an efficient business operation structure inIndonesia.
The Asahi Group intends to enhance the corporate value of the entire Group by
improving the profitability of each business and increasing the capital efficiency
through “Medium Term Management Plan 2015”.
The Group cordially requests shareholders’ continuing encouragement and support.

40

(7) Principal Subsidiaries
Company name

CapitalShareholdings(Million yen)(%)

Main operations

Asahi Breweries, Ltd.

20,000100.0

Asahi Soft Drinks Co., Ltd.

11,081100.0

Calpis Co., Ltd.

13,056100.0

Production andmarketing of soft drinks

LB Co., Ltd.

487

100.0

Production andmarketing of soft drinks

Asahi Food & Healthcare Co., Ltd.

3,200

100.0

Wakodo Co., Ltd.

2,918

100.0

Production andmarketing of foods
Production andmarketing of foods

67

100.0

27,593100.0

Amano Jitsugyo Co., Ltd.
Schweppes Australia Pty Limited(A$372,231
thousand)Asahi Professional Management Co.,
Ltd.

50

100.0

Production andmarketing of alcoholic
beverages
Production andmarketing of soft drinks

Production andmarketing of foods
Production andmarketing of soft drinks
Contracting of clerical
work

Notes:
1. Shareholding percentages include shares held indirectly.

2. There were 85 consolidated subsidiaries of the Company as of the end of the fiscal year underreview, including those listed above. There were 113 affiliates accounted for by the equity
method, including Tsingtao Brewery Co., Ltd. and Tingyi-Asahi Beverages Holding Co., Ltd.

(8) Significant Developments such as Corporate Reorganization
Not applicable.

41(9) Principal Offices and Factories(As of December 31, 2013)

A. Asahi Group Holdings, Ltd.
(Registered head office)23-1, Azumabashi 1-chome, Sumida-ku, Tokyo(Laboratory)

Research & Development Center (Moriya City, Ibaraki Prefecture)

B. Subsidiaries
Businesssegment

Alcoholic
Beverages

Company name

Asahi Breweries,
Ltd.

Asahi Soft Drinks
Co., Ltd.

Soft Drinks

Calpis Co., Ltd.

LB Co., Ltd.

Major establishments
Registered head
office23-1, Azumabashi 1-chome, Sumida-ku, Tokyo

Regional sales
officesTokyo Metropolitan Headquarters (Chuo-ku,
Tokyo), etc.

Production
facilities

Ibaraki Brewery (Moriya City, Ibaraki
Prefecture), etc.

Laboratories

Development Laboratories for Alcoholic
Beverages (Moriya City, Ibaraki Prefecture), etc.

Registered head
office23-1, Azumabashi 1-chome, Sumida-ku, Tokyo

Regional sales
officesTokyo Metropolitan Branch (Chuo-ku, Tokyo),etc.

Production
facilities

Akashi Plant (Akashi City, Hyogo Prefecture),
etc.

Laboratories

Products Research & Development Laboratory(Moriya City, Ibaraki Prefecture), etc.

Registered head
office4-1, Ebisu-minami 2-chome, Shibuya-ku.
Tokyo

Regional sales
officesDairy Products Department (Shibuya-ku,
Tokyo), etc.

Production
facilities

Gunma Plant (Tatebayashi City, Gunma
Prefecture), etc.

Laboratories

Microbiology & Fermentation Laboratory(Sagamihara City, Kanagawa Prefecture), etc.

Registered head
office3469-1, Aza Sakuragaoka, Ooaza Kurohama,
Hasuda City, Saitama Prefecture

Regional sales
offices

CVS Marketing Department (Taito-ku, Tokyo),etc.

Production
facilities

Hasuda Plant (Hasuda City, Saitama
Prefecture), etc.

Laboratories

Marketing Department (Hasuda City, Saitama
Prefecture)42

Asahi Food &Healthcare Co.,Ltd.

Wakodo Co., Ltd.

Foods

Amano JitsugyoCo., Ltd.

International
operations

Schweppes
Australia Pty
LimitedRegistered head
office23-1, Azumabashi 1-chome, Sumida-ku, Tokyo

Regional sales
offices

Food Sales Section I for Chain Stores (Chuo -ku,
Tokyo), etc.

Production facilities

Osaka Plant (Suita City, Osaka Prefecture), etc.

Laboratories

Laboratory (Chuo-ku, Tokyo)

Registered head
office14-3, Kanda Tsukasa-cho 2-chome, Chiyoda-ku,
Tokyo

Regional sales
officesTokyo Branch (Shinjuku-ku, Tokyo), etc.

Production facilities

Tochigi Plant (Sakura City, Tochigi Prefecture)

Laboratories

Research Laboratory (Chofu City, Tokyo)

Registered head
office9-10, Dosan-cho, Fukuyama City, Hiroshima
Prefecture

Regional sales
offices

East Japan Branch (Chiyoda-ku, Tokyo), etc.

Production facilities

Satosho Factory (Asakuchi-gun, Okayama
Prefecture)

Laboratories

R&D Center (Asakuchi-gun, Okayama
Prefecture)

Registered head
officeVictoria, Australia

Business locations

New South Wales, Australia, etc.

(10) Employees(As of December 31, 2013)

Business segment
Alcoholic Beverages

Number of employees
4,510

Increase (decrease) fromthe end of the previous term
(126)

Soft Drinks

4,171

89

Foods

1,398

31

International Operations

5,649

540

Other Businesses

1,787

64

Company-wide (common)

486

(46)

Total

18,001552

43

2. Overview of the Company(1) Shares Outstanding (As of December 31, 2013)
A. Total number of authorized shares

972,305,309(common stock)

B. Total number of issued shares

483,585,862(including 21,352,561 shares in treasury stock)

C. Number of shareholders

109,543(Decreased by 10,708 from the end of the previous term)

44

D. Major shareholders
Number ofshares held

Percentage ofshares held(in hundreds)(%)

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

277,023

6.0

Asahi Kasei Corporation

187,853

4.1

Japan Trustee Services Bank, Ltd. (Trust Account)

177,843

3.8

The Dai-ichi Life Insurance Company, Limited

169,200

3.7

Fukoku Mutual Life Insurance Company

160,000

3.5

JPMorgan Chase Bank 380055

100,009

2.2

Sumitomo Mitsui Banking Corporation

90,280

2.0

Sumitomo Mitsui Trust Bank, Limited

81,2601.8State Street Bank and Trust Company

56,972

1.2

The Norinchukin Bank

55,6601.2

1,356,101

29.3

Name of shareholder

Total
Notes:

1. The Company holds treasury stock numbering 213,525 hundred shares. However, the Company is
excluded from the above list of major shareholders.
2. Shareholding percentages are calculated based on the total number of issued shares less the numberof shares in treasury stock.

E. Other significant matters related to shares
The Company acquired 13,217,100 shares of common stock of the Company pursuant to the resolution at
the meeting of the Board of Directors held on February 13, 2013.

45

(2) Status of Stock Acquisition Rights, etc. (as of December 31, 2013)
A. Stock acquisition rights held by Directors and Corporate Auditors of the Company

Date of issuance resolution
Number of stock acquisitionrightsClass and number of sharessubject to stock acquisitionrightsFee for exercise of stockacquisition rights
Exercisable period
Conditions for exercise ofstock acquisition rights

1) Second issue of stock acquisitionrightsMarch 30, 2004
130
Shares of common stock: 13,000¥1,205 per share
March 30, 2006 to March 29, 2014
 The options are exercisable evenafter the resignation of Directors or
Corporate Auditors, as the case maybe.
 The options may be passed on toheirs.
 The options shall be cancelled if aholder is dismissed for certain
specified reasons.
 Any assignment or pledging of theoptions is prohibited.

Situation concerning the holding of stock acquisition rights by Directors
and Corporate Auditors
Directors
 Number of stock acquisition rights:(except Outside Directors)
30
 Number of shares subject to stockacquisition rights: 3,000 Number of holders: 1
Outside Directors

 Number of stock acquisition rights:—
 Number of shares subject to stockacquisition rights: — Number of holders: —Corporate Auditors

 Number of stock acquisition rights:
100
 Number of shares subject to stockacquisition rights: 10,000
 Number of holders: 1

46

Date of issuance resolution
Number of stock acquisitionrightsClass and number of sharessubject to stock acquisitionrightsFee for exercise of stockacquisition rights
Exercisable period
Conditions for exercise ofstock acquisition rights

2) Third issue of stock acquisitionrightsMarch 30, 2005

3) Fourth issue of stock acquisitionrightsMarch 30, 2006

530

779

Shares of common stock: 53,000

Shares of common stock: 77,900¥1,374 per share¥1,688 per share

March 30, 2007 to March 29, 2015

March 30, 2008 to March 29, 2016 The options are exercisable evenafter the resignation of Directors or
Corporate Auditors, as the case maybe.
 The options may be passed on toheirs.
 Any assignment or transfer of thestock acquisition rights is subject toapproval of the Board of Directors.

 The options are exercisable evenafter the resignation of Directors or
Corporate Auditors, as the case maybe.
 The options may be passed on toheirs.
 Any assignment or transfer of thestock acquisition rights is subject toapproval of the Board of Directors.

Situation concerning the holding of stock acquisition rights by Directors and Corporate Auditors
Directors(except Outside Directors)

 Number of stock acquisition rights:
230
 Number of shares subject to stockacquisition rights: 23,000 Number of holders: 2

 Number of stock acquisition rights:479
 Number of shares subject to stockacquisition rights: 47,900
 Number of holders: 3

Outside Directors

 Number of stock acquisition rights:—
 Number of shares subject to stockacquisition rights: — Number of holders: — Number of stock acquisition rights:—
 Number of shares subject to stockacquisition rights: — Number of holders: —Corporate Auditors

 Number of stock acquisition rights:
300
 Number of shares subject to stockacquisition rights: 30,000
 Number of holders: 3

 Number of stock acquisition rights:
300
 Number of shares subject to stockacquisition rights: 30,000
 Number of holders: 3

47

B. Significant matters regarding other stock acquisition rights
Overview of Euroyen conditional convertible bonds with stock acquisition rights

Date of issuance resolution

1) Euroyen conditional convertible
bonds with stock acquisition rights
maturing in 2023
May 13, 2008

2) Euroyen conditional convertible
bonds with stock acquisition rights
maturing in 2028
May 13, 2008

Date of issue

May 29, 2008

May 29, 2008

Outstanding amount of bonds
with stock acquisition rights¥15,937 million¥35,000 million

Details concerning the stock acquisition rights
Number of stock acquisition
Total of 35,000 and the number
rightscalculated by dividing the total facevalue of the substitute bonds with stockacquisition rights by ¥1,000,000

Total of 35,000 and the number
calculated by dividing the total facevalue of the substitute bonds with stockacquisition rights by ¥1,000,000

Class and number of sharessubject to stock acquisitionrightsFee for exercise of stockacquisition rights
Exercisable period

Shares of common stock: 16,611,295

Shares of common stock: 17,073,170¥2,107 per share¥2,050 per share

June 12, 2008 to May 12, 2023

June 12, 2008 to May 12, 2028

Conditions for exercise ofstock acquisition rights

 Certain stock acquisition rights may
not be exercised.
 Prior to May 29, 2011, but only when
the closing price of the Company’scommon stock for 20 of the last 30
trading days (including the last
trading day) exceeds 125% of theconversion price (¥2,107) as of thelast trading date of each quarter. In
such cases, exercise is possible, in
principle, during the following
quarter.

 Certain stock acquisition rights may
not be exercised.
 Prior to May 29, 2014, but only when
the closing price of the Company’scommon stock for 20 of the last 30
trading days (including the last
trading day) exceeds 125% of theconversion price (¥2,050) as of thelast trading date of each quarter. In
such cases, exercise is possible, in
principle, during the following
quarter.

Conditions under which theCompany may acquire stockacquisition rights

 On or after May 29, 2011, theCompany may acquire all of thebonds after notifying thebondholders.
 The acquisition date shall be at least
60 but no more than 75 days from thenotification date.

 On or after May 29, 2014, theCompany may acquire all of thebonds after notifying thebondholders.
 The acquisition date shall be at least
60 but no more than 75 days from thenotification date.

48

(3) Directors and Corporate Auditors of the Company
A. Directors and Corporate Auditors(As of December 31, 2013)

Name
Hitoshi
Ogita

Areas of responsibility andsignificant concurrent positions

Position

Chairman and Representative Overall Group Management
Director
Outside Director of NEC Corporation
Outside Director of Imperial Hotel, Ltd.

Naoki
IzumiyaPresident andRepresentative Director

Overall Group Management

Katsuyuki
Kawatsura

Senior Managing Director

Human Resources Section, Research & Development Section,
Intellectual Property Section

Senior Managing Corporate
OfficerGroup Food BusinessDirector of Asahi Food & Healthcare Co., Ltd.
Director of Wakodo Co., Ltd.
Director of Amano Jitsugyo Co., Ltd.
Director of Asahi Professional Management Co., Ltd.

ToshioKodatoDirector

Public Relations Section, Agribusiness Development Section

Corporate Officer

Group China Business

Shiro

Director

Ikeda

Corporate Officer

Audit Section, Secretary Section, Corporate Social
Responsibility Section, Lifestyle & Culture Section,
International Business Section
Group Soft Drinks Business, Group International Operations
Director of Asahi Soft Drinks Co., Ltd.
Director of Calpis Co., Ltd.

Katsutoshi
Takahashi

Director

Yoshihide
Okuda

Director

Corporate Officer

Procurement Section, Production Section, Logistics Section,
Quality Assurance Section
Director of LB Co., Ltd.

Corporate Officer

General & Legal Affairs Management Section, Finance
Section, Information Technology Section
President and Representative Director of Asahi Professional
Management Co., Ltd.

Akiyoshi
Koji

Director

Group Alcoholic Beverages BusinessPresident and Representative Director of Asahi Breweries,
Ltd.

49

Name
MarikoBando

Areas of responsibility andsignificant concurrent positions

Position
Outside Director

President of Showa Women’s University
Director of Showa Women’s University
Director of The Institute of Women’s Culture, Showa
Women’s University
Chairman of the Board of Rural Women Empowerment andLife Improvement Association

Naoki
TanakaOutside Director

President of Center for International Public Policy Studies

IchiroIto

Outside Director

Chairman and Representative Director of Asahi Kasei
Corporation

Yoshihiro
TonozukaStanding Corporate Auditor

Yukio
KakegaiStanding Corporate Auditor

Corporate Auditor of Asahi Breweries, Ltd.
Corporate Auditor of Calpis Co., Ltd.
Corporate Auditor of Asahi Food & Healthcare Co., Ltd.
Corporate Auditor of Asahi Soft Drinks Co., Ltd.
Corporate Auditor of Wakodo Co., Ltd.
Corporate Auditor of Amano Jitsugyo Co., Ltd.

Takahide
Sakurai

Outside Corporate Auditor

Special Adviser to The Dai-ichi Life Insurance Company,
Limited

Naoto
Nakamura

Outside Corporate Auditor

Partner and Attorney at Law of Nakamura, Tsunoda &Matsumoto Law OfficeOutside Corporate Auditor of Mitsui & Co., Ltd.
Outside Corporate Auditor of Recruit Holdings Co., Ltd.

TadashiIshizakiOutside Corporate Auditor

Professor of Faculty of Management and Culture, Shoin
University
Professor Emeritus, Chuo University

Notes:
1. Directors Mariko Bando, Naoki Tanaka and Ichiro Ito are Outside Directors as defined in Item 15,
Article 2 of the Companies Act.
2. Corporate Auditors Takahide Sakurai, Naoto Nakamura and Tadashi Ishizaki are Outside Corporate
Auditors as defined in Item 16, Article 2 of the Companies Act.
3. The Company designated Outside Directors Mariko Bando, Naoki Tanaka and Ichiro Ito and Outside
Corporate Auditors Takahide Sakurai, Naoto Nakamura and Tadashi Ishizaki as Independent
Directors/Auditors as defined by the Tokyo Stock Exchange and reported to the said exchange.
4. Corporate Auditor Yukio Kakegai was formerly General Manager of Audit Department of theCompany and has considerable expertise in finance and accounting.
5. Corporate Auditor Naoto Nakamura who is an attorney at law is jurisprudent, among others, tocorporate legal affairs; he also has considerable expertise in finance and accounting.
6. Corporate Auditor Tadashi Ishizaki has carried out research on accounting for many years as auniversity professor; he has considerable expertise in finance and accounting.
7. Director Kazuo Motoyama retired upon the expiry of his term of office at the conclusion of the 89th
Annual General Meeting of Shareholders held on March 26, 2013. Also, Katsutoshi Takahashi and
Yoshihide Okuda were newly elected as Directors and assumed their respective offices at the same
meeting.

50

8. In addition to the above, the retirement from significant concurrent positions by Directors or Corporate
Auditors during the year under review are detailed below.

Name
Shiro Ikeda

Position
Director
Corporate Officer

Significant concurrent positions

Date ofupon retirement

retirement

Director of LB Co., Ltd.

March 21, 2013

Mariko Bando

Outside Director

Outside Director of Asahi MutualLife Insurance Company

July 2, 2013

Takahide Sakurai

Outside Corporate
AuditorOutside Director of Imperial Hotel,
Ltd.

June 26, 2013

9. Takahide Sakurai ceased to serve as Corporate Auditor as he passed away on January 3, 2014.

B. Remuneration paid to Directors and Corporate Auditors
Category
Directors[of which, Outside Directors]
Corporate Auditors[of which, Outside Corporate
Auditors]

Basic remuneration
Number of
Total amount of
persons
remuneration paid
remunerated(yen)
11
314,700,000[3][31,200,000]
5[3]

96,000,000[32,400,000]

Number of
persons
remunerated
11
[3]
—
—

Bonus
Total amount of
remuneration paid(yen)
112,000,000[12,300,000]——

Total amount(yen)
426,700,000[43,500,000]
96,000,000[32,400,000]

Notes:
1. The figures above include Director Kazuo Motoyama, who retired at the conclusion of the 89th
Annual General Meeting of Shareholders held on March 26, 2013.
2. A resolution authorizing payments associated with the termination of the retirement bonus system
to be paid at the time of retirement was passed at the 83rd Annual General Meeting of Shareholders
held on March 27, 2007. As of the end of the fiscal year under review, the anticipated total amountof future payments was as follows:
Total of ¥32,000,000 to two Directors
Total of ¥33,000,000 to three Outside Corporate Auditors
The anticipated total amount of future payment to one Outside Corporate Auditor who ceased toserve as Outside Corporate Auditor as he passed away on January 3, 2014 is ¥22,800,000, and theanticipated total amount of future payment to one Director retiring at the conclusion of the 90th
Annual General Meeting of Shareholders to be held on March 26, 2014, is ¥13,000,000.
3. The total amount of Directors’ remuneration, etc. is ¥760 million (including ¥50 million for
Outside Directors) per year according to the resolution passed at the 83rd Annual General Meetingof Shareholders held on March 27, 2007.
4. The total amount of Corporate Auditors’ remuneration, etc. is ¥120 million (including ¥40 million
for Outside Corporate Auditors) per year according to the resolution passed at the 83rd Annual
General Meeting of Shareholders held on March 27, 2007.

51

C. Policies concerning the setting of remuneration paid to Directors and Corporate
Auditors

Directors’ and Corporate Auditors’ remuneration amounts are set within the total
amount of remuneration resolved in advance at a General Meeting of Shareholders.
Furthermore, Directors’ remuneration is set in line with a resolution at a meeting of theBoard of Directors, and Corporate Auditors’ remuneration is set by discussion by the
Corporate Auditors thereof. When remuneration -related resolutions are being made by
the Board of Directors, the Compensation Committee, having Outside Directors making
up half of its membership, acts as an advisory body to the Board of Directors,
evaluating the content of said resolutions in the interests of greater transparency andobjectivity.
It should be noted that the retirement bonus system and stock option system wereboth discontinued in 2007.
In the interests of setting Directors’ remuneration in a reasonable manner given
roles and responsibilities, the system for doing so takes into consideration each
Director’s motivational abilities in terms of ongoing enhancement of corporation
performance and value in addition to the recruitment of talented persons.
In specific terms, remuneration comprises basic remuneration (a fixed monthly
amount) and bonuses (yearly performance-linked amounts), and each item is determinedusing survey data prepared by external specialist organizations and based on duties andstatus as Director or Outside Director. In addition, bonuses are raised or lowered basedon consolidated operating income as the main index.
In the interests of setting Corporate Auditors’ remuneration in a reasonable
manner given roles and responsibilities, the system for doing so takes the recruitment of
talented persons into consideration.
In specific terms, remuneration comprises only basic remuneration (a fixedmonthly amount), and it is determined by discussion by the Corporate Auditors using
survey data prepared by external specialist organizations and based on duties and status
as Corporate Auditor or Outside Corporate Auditor.

52

D. Outside Directors and Outside Corporate Auditors

1) Major activities of Outside Directors and Outside Corporate Auditors
Category
OutsideDirector

OutsideCorporate
Auditor

Name

Number of
Number of
Board of Directors Board of Auditors
meetings attended meetings attended

Form of participation

Mariko Bando

10/10

—

Ms. Bando participated in
discussions as necessary, primarily
from the perspective of her wealthof experience as an educator.

Naoki Tanaka

10/10

—

Mr. Tanaka participated in
discussions as necessary, primarily
from the perspective of his wealth ofexperience as an expert in economic
policy.

Ichiro Ito

8/10

—

Mr. Ito participated in discussions asnecessary, primarily from theperspective of his wealth ofexperience as a manager.

Takahide Sakurai

5/10

5/8

Mr. Sakurai participated in
discussions as necessary, primarily
from the perspective of his wealth ofexperience as a manager.

Naoto Nakamura

9/10

8/8

Mr. Nakamura participated in
discussions as necessary, primarily
from his expert perspective as an
attorney at law.

Tadashi Ishizaki

10/10

8/8

Dr. Ishizaki participated in
discussions as necessary, primarily
from his expert perspective as ascholar of accounting.

Note:
In addition to the aforementioned meeting of the Board of Directors held the fiscal year under review,“deemed resolution in writing” pursuant to Article 370 of the Companies Act were adopted on two
occasions.

2) Summary of agreements limiting liability
The Company has entered into an agreement with each of its Outside Directors andOutside Corporate Auditors limiting his/her liability for damages as prescribed in
Paragraph 1, Article 423 of the Companies Act, to either ¥20,000,000 or theminimum amount stipulated by applicable laws and regulations, whichever is higher.

53

(4) Independent Accounting Auditor
A. Name of the Independent Accounting Auditor

KPMG AZSA LLC
B.

Remuneration paid to the Independent Accounting Auditor for the fiscal year underreview
Category

Amount payable

Remuneration paid for the fiscal year under review¥137 million
Total of cash and other financial profits payable by the Company and¥437 million
its subsidiaries to the Independent Accounting Auditor
Note:
In its agreement with the Independent Accounting Auditor, the Company makes no distinction
between the remuneration that it pays for auditing services governed by the Companies Act and forauditing services governed by the Financial Instruments and Exchange Act. Consequently, theamount ¥137 million shown above is a sum of these two amounts.

C. Nature of non-audit professional services provided by the Independent Accounting
Auditor

The Company also assigns professional duties to the Independent Accounting
Auditor that are not statutory auditing duties as stipulated in Paragraph 1, Article 2 of
the Certified Public Accountants Law. These non-audit services include “guidance andadvisory services for conversion to International Financial Reporting Standards”.

D. Company Policy regarding dismissal of or decision not to reappoint the Independent
Accounting Auditor

Article 340 of the Companies Act stipulates that the Board of Auditors shall beentitled to dismiss the Independent Accounting Auditor for reasons stipulated therein. In
addition, when it is reasonably recognized that the Independent Accounting Auditor is
no longer able to execute its duties in an appropriate manner, the Company, with theprior consent of, or a request by, the Board of Auditors, shall offer to the General
Meeting of Shareholders a resolution to dismiss or not to reappoint the Independent
Accounting Auditor.

54

3. Systems to Ensure Appropriate Execution of Directors’ Duties in
Conformity With Laws and Regulations and the Articles ofIncorporation, and Other Systems to Ensure Appropriate Business
Operations
The Board of Directors passed the following resolution with respect to the abovementioned systems:
The Company has adopted the following corporate philosophy of the Asahi
Group: “The Asahi Group aims to satisfy its customers with the highest levels of quality
and integrity, while contributing to the promotion of healthy living and enrichment ofsociety worldwide”. To make these aims a reality, the Company shall:establish, in accordance with the Companies Act and the Enforcement Regulationsof the Companies Act, the following basic policies (the “Basic Policies”) to
improve systems designed to ensure appropriate business operations of theCompany and its subsidiaries (herein this section the “Group Companies”) (herein
this section the “Internal Control”);

recognize that it is the Representative Director(s) who shall assume the ultimate
responsibility for the improvement of the Internal Control in accordance with thisresolution and demand the Representative Director(s) to cause the Directors andCorporate Officers, through the respective departments and organizations they arein charge of, to develop and fully enforce individual internal regulations required
based on the Basic Policies; andtake steps to maintain and enhance the effectiveness of the Internal Control byreviewing the Basic Policies and relevant internal regulations in a timely andappropriate manner in accordance with changes in conditions and circumstances.

<System to ensure execution of duties by Directors and employees inconformity with laws and regulations and the Articles of Incorporation of theCompany>A.

In accordance with a statement of “Fair and Transparent Corporate Ethics” asstipulated in “Asahi Group’s Corporate Action Guidelines”, the Company shallestablish “Regulations on Corporate Ethics for the Asahi Group” and “Asahi Group
Corporate Ethics Guidelines” and procure its Directors, Corporate Auditors andemployees abide by these regulations.

B.

In accordance with internal regulations, the Company shall establish the “RiskManagement Committee”, which will oversee the compliance affairs and risk
management of the Asahi Group. One of the committee’s members shall be an55

outside attorney-at-law.
C.

An Officer of the Company in charge of compliance shall have authority overcompliance and risk management within the Asahi Group. The sections in chargeof general and legal affairs shall handle day-to-day compliance and risk
management tasks.

D.

The Company shall assign an appropriate number of persons as “CompliancePromotion Personnel” in each Group Company depending on its size. In
conjunction with the section in charge of legal affairs at the Company andrespective organizations in charge of general or legal affairs of the Group
Companies, all Compliance-Promotion Personnel shall endeavor to disseminate
legal knowledge and to heighten a general awareness of importance of compliancein their respective Group Companies.

E.

The Company shall establish a “Clean Line System” for employees of the Asahi
Group, enabling them to blow the whistle on illicit behavior of others.

F.

The Company shall establish “Asahi Group’s Basic Policy on Procurement”
addressing mutual cooperation for fair deals and social responsibilities between theeach Group Company and suppliers and system that enables suppliers to blow awhistle on breaches of the Policy as necessary. The Company shall inform andspell out these measures to its suppliers to enable the Company to develop Internal
Control in cooperation with its suppliers.

G.

To ensure antisocial forces do not exert any undue influence on the Group, allrelevant information shall be shared within the Asahi Group and the Company
shall establish an internal system on the measures. The Company shall also
cooperate closely with industry bodies, local communities, the police and otherexternal specialist organizations in this area.

H.

The operational details of the aforementioned agencies and systems shall bespelled out under a separately prepared set of internal regulations.

<System to ensure the preservation and management of information related to
execution of duties by Directors>
A.

Information related to execution of duties by Directors shall be properly preserved
and managed in accordance with “Document-Management Regulations” and otherrelated internal regulations.

B.

The aforementioned information shall be preserved and managed in a way
accessible by Directors and Corporate Auditors for inspection at any time.

C.

Control over the clerical tasks related to preservation and management of the56

aforementioned information shall be determined in accordance with internal
regulations.

<Regulations and other organizational structures to manage risk of loss>A.

The Company shall develop and adopt “Asahi Group Risk Management
Regulations” and shall affirm them as the highest standards governing risk
management within the Asahi Group. It shall also establish a manual on theRegulations and disseminate the same among all over the Group.

B.

In addition to having the appropriate sections manage risk in their respective areas,
the “Risk Management Committee” shall perform comprehensive risk management
across the entire Asahi Group. The “Risk Management Committee” shallperiodically analyze and evaluate risks in accordance with internal regulations
cited in the previous paragraph and, when necessary, carry out comprehensive
reviews of the risk management system. Utmost attention shall be paid to the riskof failing to maintain product quality. As a food and drink manufacturing group,
the Asahi Group strongly recognizes their social responsibility to consumers toensure the safety of their products.

C.

In the event of any major accident, disaster or scandal, the Company shall establish
a “Crisis-Response Meeting” chaired by a Representative Director.

<System to ensure efficient execution of duties by Directors>
A.

To ensure efficient performance of duties by Directors, the “Board of Directors”
shall divide duties in a reasonable way to be delegated to different Directors andshall appoint appropriate persons as Corporate Officers in charge of different
sections.

B.

The Company shall establish “Regulation of Authority” stipulating rules ofdelegation of power and for a mutual checks-and-balances mechanism among
different sections.

C.
D.

The Company shall ensure effective utilization of the system of the “Corporate
Strategy Board”.
To maximize operational efficiency, the Company shall utilize indices that provide
an objective and rational way of measuring its management and control ofoperations; and it shall employ a unified system of follow-up and evaluation.

57

<System to ensure appropriate operations of the corporate group consisting of
the Company and its parent (if any) and its subsidiaries>
A.

All systems required for the Internal Control, including those for compliance andrisk management, shall apply comprehensively across the entire Asahi Group. As
the holding company, the Company shall manage and operate the said systems of
the Group Companies in accordance with the conditions and circumstancesindividual companies are facing.

B.

The section in charge of internal auditing in the Company shall get a grasp of andevaluate the Internal Control and discipline in day-to-day tasks within the Asahi
Group by directly and indirectly auditing the Group Companies. In addition,
regarding the Internal Control related to financial reporting, the organization in
charge of evaluation established within the Asahi Group shall conduct theevaluation on the Internal Control of the Group Companies and submit the relevant
reports.

C.

Each of the Group Companies shall be required to provide reports on performanceof its operations including risk-related information, to the Corporate Auditors of
the Company.

D.

Decision-making authority related to business activities of the Group Companies
shall be subject to the document entitled “Asahi Group’s Regulation of Authority”.

<Securement of employees in the event that Corporate Auditors request staff toassist in their auditing duties>
The “Board of Auditors” shall appoint staff to serve the Board of Auditors, forassistance in the day-to-day activities of the Corporate Auditors.

<Independence of employees assigned to assist the Corporate Auditors from the
Directors>
A.

When a member of the staff who serves the Board of Auditors, as stipulated in theprevious paragraph, receives an order from a Corporate Auditor in relation toauditing duties, he/she shall not be subject to directives or orders from Directors orother employees regarding that order.

B.

Any issuance of orders to, personnel transfers of, merit evaluations of, or
reprimands of a member of the staff who serves the Board of Auditors shall require
the prior concurrence of Corporate Auditors.

58

<System for Directors’ and employees’ reporting to Corporate Auditors; system
relating to other reporting to Corporate Auditors>
A.

Directors and employees shall report regularly to Corporate Auditors on mattersrelated to the Internal Control, and shall report on an as-needed basis when asignificant event occurs. When necessary, the Corporate Auditors shall be entitled
to request reports from the Directors and employees (including from Directors andemployees of the Group Companies).

B.

Directors shall ensure that Corporate Auditors have every opportunity toparticipate in discussions of important bodies, etc. such as the “Board of Directors”
meetings, the “Corporate Strategy Board” meetings and the “Risk Management
Committee” meetings. Directors shall provide details of the agenda items of suchmeetings beforehand for Corporate Auditors.

C.

Corporate Auditors shall at all times have the right to review the minutes ofimportant meetings, documents of approval, etc.

<Other systems ensuring effective auditing by Corporate Auditors>
To ensure the effectiveness of auditing activities, Directors shall ensure
opportunities for Corporate Auditors to exchange information and opinions regularly
with members of the section in charge of internal auditing of the Company and with the
Independent Accounting Auditor.

59

The corporate governance system of the Company is shown in the chart below.

60

4. Basic Policy Concerning the Persons Who Control Decisions on the
Company’s Financial and Business Policy<Basic policy>
According to the Company’s view, the persons who control decisions on its
financial and business policy must properly grasp various matters concerning its
business, including the initiatives to “create appealing products”, to “care about quality
and craftsmanship” and to “convey the sense of joy to customers”, which form thesource of the corporate value of the Asahi Group, and other tangible and intangible
management resources thereof, potential effects of forward-looking measures and otheritems that constitute the corporate value, and must enable to maintain and enhance the
Asahi Group’s corporate value as well as the common interests of shareholders
continuously and sustainably.
Upon facing a proposal of large-scale share purchases, the Company is not always
in a position to automatically object to the purchases if it is a so-called hostile takeover,which is pursued without approval from the Board of Directors (hereinafter referred toas the “Board”) provided that such takeover is intended to contribute to theenhancement of the corporate value and the common interests of shareholders of theCompany. Also, the Company recognizes that the final decision as to whether to accept
a proposal for an acquisition of shares in the Company that would lead to a transfer ofcontrol of the Company should be made based on the will of the shareholders as awhole.
It shall be noted, however, that there are not a few cases of large-scale sharepurchases that would not contribute to the enhancement of the corporate value and thecommon interests of shareholders of a company, including ones that would, in light of
their purposes, cause obvious damage to the corporate value and the common interestsof shareholders or could effectively coerce shareholders to sell their shares, ones that thepurchaser does not provide information and/or time reasonably necessary for the target
company’s board of directors and shareholders to review and examine details of the
proposed purchase or for the target company’s board of directors to make an alternative
proposal, and ones where the target company’s board of directors would have to
conduct negotiation with the purchaser so as to seek more favorable terms than thoseinitially proposed by the purchaser.
The person who intends to conduct a large-scale purchase of shares in the Company
must have an understanding of the source of the Asahi Group’s corporate value andhave the capability to maintain and enhance it in the medium and long term; otherwise,
the Asahi Group’s corporate value and the common interests of shareholders would bedamaged.
The Company thus believes that it is necessary to protect the Asahi Group’s
61

corporate value, and in turn, the common interests of shareholders, from such largescale share purchases.

<Framework that contributes to realization of the basic policy>
A. Special Measures Contributing to Realization of the Basic Policy
In its “Long-Term Vision 2020”, the Company sets out its aim: “Striving to bea corporate group trusted around the world through the Kando of food(deliciousness, happiness and innovation)”. To fulfill this Vision, initiatives in its
three-year plan “Medium-Term Management Plan 2015” were launched on agroup-wide scale, aimed at enhancing corporate value through the promotion of“Value and Network Management”.
In the “Medium-Term Management Plan 2015”, the Company focuses on the“strengths” that it developed and acquired over the years, such as its brand,
technologies and cost competitiveness, and leverages them for the creation of newvalues and innovation. The Company will also seek to maintain long-term stable
growth by the above mentioned strategies and further expanding its domestic andoverseas networks. Giving utmost priority to growth of its sales and profit, theGroup will work together for the continual increase in key performance indicators
ROE (return on equity) and EPS (earnings per share) by improving capitalefficiency through such means as increase of shareholder returns.
The Company believes that by diligently implementing “Medium-Term
Management Plan 2015” with the Group acting as a whole in pursuit of the goals of“Long-Term Vision 2020”, it can significantly strengthen the relationship of trust
between the Asahi Group and its stakeholders, and in addition, can secure andenhance corporate value, and thus, the common interests of shareholders.
The Company is striving to further strengthen its corporate governance for the
aforementioned measures.
By introducing a corporate officer (Sikko-Yakuin) system on March 30, 2000,
the Company separated the management decision-making and execution functions
with a view to speeding up execution of business decisions and endeavored tostrengthen the supervisory function of the Board. In addition, the Company has
appointed three Outside Directors and three Outside Corporate Auditors* as
independent directors/auditors as defined by the Tokyo Stock Exchange andreported to the exchange to that effect.
* Takahide Sakurai passed away and ceased to serve as Outside Corporate Auditor on January 3,
2014; accordingly, there are two Outside Corporate Auditors reported as independent auditors atpresent.
62

Furthermore, the Company operates a system that facilitates checks by Outside
Directors/Corporate Auditors by establishing the “Nomination Committee” and the“Compensation Committee”, both of which act as an advisory body to the Board of
Directors and include Outside Directors as members.
In order to further clarify the accountability of the management to shareholders,the Company shortened the term of office of its Directors from two years to one
year at the 83rd Annual General Meeting of Shareholders held on March 27, 2007.
By transitioning to a pure holding company structure on July 1, 2011, theCompany strengthened its business platforms through the pursuit of specializationand the clarification of authorities and responsibilities of each business section, as
well as promoted the expansion of domestic and overseas business networks inorder to enhance its corporate value.
B. Efforts to prevent decisions on the Company’s financial and business policy
from being controlled by any person who is inappropriate according to thebasic policy
The Company will take appropriate measures against any person who attempts
to make a large-scale purchase to the extent permitted by the Financial Instruments
and Exchange Act, the Companies Act and other related laws and regulations suchas requesting provision of necessary and sufficient information for shareholders toproperly determine whether to approve or disapprove the large-scale purchase,
disclosing the opinions, etc. of the Board of Directors of the Company andendeavoring to secure enough time for shareholders to contemplate the large-scalepurchase.

<Judgment of the Company’s Board regarding the specific measures andreasons therefor>
The measures described above in A of <Framework that contributes to realizationof the basic policy> conform to the basic policy of the Company as described above, arefully compatible with the corporate value and the common interests of shareholders of
the Asahi Group including the Company, and are never implemented for the purpose ofmaintaining the status of Directors and Corporate Auditors of the Company.

63

CONSOLIDATED FINANCIAL STATEMENTSCONSOLIDATED BALANCE SHEETS
As of
December 31, 2013

Million yen
As ofDecember 31, 2012
(Reference)

ASSETS
Current assets:
Cash and deposits
Notes and accounts receivable
Merchandise and finished goods
Raw materials and supplies
Deferred tax assets
Other current assets
Allowance for doubtful accounts
Total current assets

42,200317,106
81,562
36,74015,50444,893(3,117)534,890

34,573
317,008
79,152
34,366
12,62256,379(4,914)
529,189

Fixed assets:
Tangible fixed assets:
Buildings and structures
Machinery, equipment and vehicles
Tools, furniture and fixtures
Land
Lease assets
Construction in progress
Other tangible fixed assets
Total tangible fixed assets

164,605
120,984
51,541
206,110
21,423
19,436
117584,219

170,347
127,276
50,374
205,553
21,944
7,828
73
583,398

Intangible fixed assets:
Goodwill
Other intangible fixed assets
Total intangible fixed assets

196,20393,822290,025

203,764
95,373299,137

331,427
6,962
9,079
9,120
31,476(5,647)
382,419
1,256,665
1,791,555

266,248
4,232
8,245
18,212
26,932(3,409)320,461
1,202,998
1,732,187

Investments and other assets:
Investment securities
Long-term loans receivable
Long-term prepaid expenses
Deferred tax assets
Other investments
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
Total assets

64

CONSOLIDATED BALANCE SHEETS

As of
December 31, 2013

Million yen
As ofDecember 31, 2012
(Reference)

118,650
134,334
67,00020,0008,532
110,371
10,34432,151
68,457
66,76518,0874,284
7,102
666,081

117,774
174,697
68,000—7,975
112,598
17,722
23,201
67,91060,376
21,2004,139
4,470
680,068

148,937
33,45014,713
22,581

188,121
25,415
15,62023,851

192
37,745429
39,942297,993964,074480
31,433471
39,846325,239
1,005,308

NET ASSETS
Shareholders’ equity:
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity

182,531
152,537
428,661(40,032)
723,698

182,531150,641
383,177(27,763)688,586

Accumulated other comprehensive income:
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Total accumulated other comprehensive income

20,981
223
74,39095,5953,259(5)31,97835,232

8,186
827,481
1,791,555

3,060
726,879
1,732,187

LIABILITIESCurrent liabilities:
Notes and trade accounts payable
Short-term borrowings
Commercial paper
Bonds due within one year
Lease obligations
Alcohol tax payable
Consumption taxes payable
Income taxes payable
Other accounts payable
Accrued expenses
Deposits received
Allowance for employees’ bonuses
Other current liabilities
Total current liabilities
Long-term liabilities:
Bonds
Long-term borrowings
Lease obligations
Allowance for employees’ severance and retirement benefits
Allowance for retirement benefits for directors and corporate
auditors
Deferred tax liabilities
Asset retirement obligations
Other long-term liabilities
Total long-term liabilities
Total liabilities

Minority interests
Total net assets
Total liabilities and net assets
65

CONSOLIDATED STATEMENTS OF INCOME

For the year ended
December 31, 2013

Million yen
For the year ended
December 31, 2012
(Reference)

1,714,237
1,032,853
681,383
563,916
117,467
13,101
387
1,602
747
421

1,579,076
974,702604,374
495,937
108,437
14,123
402
1,335
—
207

8,822
1,119
6,955
3,595
3,360
123,612
4,344
1,501
988
—
—
1,564
289
17,485
4,508
39
5
12
7,473
—
3,388
—
2,057
110,470

10,616
1,559
7,738
4,043
3,695
114,821
9,356
353
187
201
8,088
—
525
24,338
3,388
—
93
888
3,069
1,459
5,943
7,954
1,540
99,840

Income taxes－current

48,53733,854

Income taxes－deferred

89
61,84495
61,7498,453
57,532
349
57,183

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income:Interest income
Dividend income
Foreign exchange gains
Gain on valuation of derivatives
Equity in net income of non-consolidated subsidiaries andaffiliated companies
Other non-operating income
Non-operating expenses:
Interest expenses
Other non-operating expenses
Recurring profit
Extraordinary gains:
Gain on sales of fixed assets
Gain on sales of investment securities
Gain on sales of shares in affiliates
Gain on change in equity
Gain on transfer of business
Other extraordinary gains
Extraordinary losses:
Loss on sales and disposal of fixed assets
Loss on sales of shares of affiliates
Loss on sales of investment securities
Loss on devaluation of investment securities
Impairment loss on fixed assets
Loss on factory restructurings
Business integration expenses
Adjustment of goodwill
Other extraordinary losses
Income before income taxes and minority interests

Income before minority interests
Minority interests
Net income

66

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS
Million yen

For the year ended December 31, 2013
Shareholders’ equity

Balance as of Jan. 1, 2013

Capital stock

Capital surplus

Retained earnings

Treasury stock

Total
shareholders’equity182,531150,641

383,177(27,763)688,586

Changes during the term
Dividends(16,264)(16,264)

Net income (loss)

61,74961,749Acquisition of treasury stock
Disposal of treasury stock

1,896(30,029)(30,029)

17,76019,657

Other changes in nonshareholders’ equity items
during the term (net)Total changes during the term

—

1,896

45,484(12,268)

35,112

Balance as of Dec. 31, 2013

182,531

152,537

428,661(40,032)

723,698

Accumulated other comprehensive income

Balance as of Jan. 1, 2013

Valuationdifference on
available-forsale securities

Deferred gains orlosses on hedges

Foreign currencytranslation
adjustments

Total
accumulated
othercomprehensive
income3,259(5)31,97835,232

Minority
interests

Total
net assets

3,060

726,879

Changes during the term
Dividends(16,264)

Net income (loss)

61,749Acquisition of treasury stock(30,029)

Disposal of treasury stock

19,657

Other changes in nonshareholders’ equity items
during the term (net)

17,721229

42,41260,363

5,126

65,489Total changes during the term

17,721229

42,41260,363

5,126

100,601

Balance as of Dec. 31, 2013

20,981

223

74,39095,595

8,186

827,48167

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. Basis for Preparation of Consolidated Financial Statements(1) Items in the scope of the consolidation
A. Number of consolidated subsidiaries: 85
Principal consolidated subsidiaries
Please see Item 1 of the “Business Report” (“Overview of Operations of the Asahi
Group, section (7) ‘Principal Subsidiaries’”), for a summary of the current status ofprincipal consolidated subsidiaries.
Companies added to the scope of consolidation during the consolidated fiscal year underreview were PT Prima Cahaya Indobeverages and Fujisansensui Co., Ltd. due to theacquisition of their shares; and Calpis Osotspa Co., Ltd., Calpis (Shanghai) Commerce& Trade Co., Ltd., PT Tirta Sukses Perkasa, KangQuan (Hangzhou) Foods Co., Ltd. and
WAKODO (Shanghai) Trading Co., Ltd. due to their incorporation.
Companies removed from the scope of consolidation during the consolidated fiscal year
under review were ILNZ Group Holdings Pty Limited, Asahi Breweries Itochu(Holdings) Limited, Usukebo Co., Ltd. and Calpis U.S.A., Inc. due to liquidation; andAsahi Beer Communications, Ltd. and Nippon Shoni-iji Shuppansha Co., Ltd. due to thepartial sale of their shares.
B. Principal non-consolidated subsidiary
Demball Limited
Rationale for exclusion from the scope of consolidation:
The non-consolidated subsidiary including the one mentioned above is all small in termsof total assets, sales, net profit or loss, and retained earnings (amount corresponding toequity ownership); it has no material impact as a whole on the consolidated financial
statements and is thus excluded from the scope of consolidation.
(2) Items concerning application of the equity method
A. Number of companies subject to application of the equity method: 113
Non-consolidated subsidiaries subject to application of the equity method: 3
Asahi Group Engineering Co., Ltd., Yeastock, Ltd., The Mill Retail Holdings Limited
The Mill Retail Holdings Limited was subject to application of the equity method during
the consolidated fiscal year under review due to acquisition of its stake.
Affiliates subject to application of the equity method: 110
These include Asahi Business Solutions Corp., Shenzhen Tsingtao Beer Asahi Co., Ltd.,
Asahi & Mercuries Co., Ltd., Tsingtao Brewery Co., Ltd., China Foods Investment
68

Corp., Tingyi-Asahi Beverages Holding Co., Ltd. and ninety-eight (98) other affiliatedcompanies, one (1) affiliated company of Mountain H2O Pty Ltd., Shanghai Jiayou
Investment Management Co., LTD., PT. Indofood Asahi Sukses Beverage, Asahi Beer
Communications, Ltd., Nippon Shoni-iji Shuppansha Co., Ltd. and Lotte Asahi Co., Ltd.
Companies that became subject to application of the equity method during theconsolidated fiscal year under review are ten (10) affiliates of Tingyi-Asahi Beverages
Holding Co., Ltd. due to incorporation; Asahi Beer Communications, Ltd. and Nippon
Shoni-iji Shuppansha Co., Ltd. due to the partial sale of their shares; and Lotte Asahi
Co., Ltd. due to an increase in its materiality as a result of additional acquisition of its
shares.
A company no longer subject to application of the equity method in the consolidated
fiscal year under review is Jiangsu Saint Fruit Winery Co. Ltd. due to the transfer of
equity stake.
B. Principal non-consolidated subsidiaries and affiliates not subject to application of the equity
methodNon-consolidated subsidiaries:

Demball Limited

Affiliates:

Asahi Business Produce Co., Ltd.

Rationale for not applying the equity method to the non-consolidated subsidiaries andaffiliates:
The companies in question have extremely slight impact on net profit or loss andretained earnings (amount corresponding to the Company’s equity ownership); they haveno material impact as a whole on the consolidated financial statements and thus theequity method was not applied.
(3) Accounting period of the consolidated subsidiaries
The accounting period of Asahi Beer U.S.A., Inc., is October 1 to September 30 and isdifferent from that of the Company. Thus, a provisional fiscal year ending at December 31
was used for Asahi Beer U.S.A., Inc. for consolidation purposes. All other consolidated
subsidiaries have the same accounting period as the Company.
(4) Significant accounting policies
A. Basis and methods of valuation for significant assets
1) Valuation basis and method for securities
Held-to-maturity debt securities:
Stated at the amortized cost.
Other securities:
69

Securities with market value
Carried at the average market value for the month immediately preceding theconsolidated balance sheet date (related valuation differences are directly charged
or credited to net assets, and the cost of securities sold is computed by themoving-average method).
Securities without market value
Stated at cost based on the moving-average method.
2) Valuation basis and method for derivatives
Market price method
3) Valuation basis and method for inventories
Merchandise, finished goods and semi-finished goods
Stated at cost determined mainly by the weighted-average method (write-downs
to net selling value regarded as decreased profitability).
Raw materials and supplies
Stated at cost determined mainly by the moving-average method (write-downs to
net selling value regarded as decreased profitability).
B. Depreciation methods for major assets
Tangible fixed assets (excluding lease assets):
Tangible fixed assets are mainly depreciated using the straight-line method. However,some consolidated subsidiaries use the declining balance method.
The estimated useful lives of the assets are based mainly on the same standards as
those specified in the Corporation Tax Act.
Intangible fixed assets (excluding lease assets):
Intangible fixed assets are amortized using the straight-line method.
The estimated useful lives of the assets are based mainly on the same standards as
those specified in the Corporation Tax Act.
Software for internal use is amortized by the straight-line method over a useful life of
five (5) years. Trademark rights are mainly amortized over twenty (20) years using thestraight-line method.
Lease assets:
Finance leases that do not transfer ownership rights are amortized to a residual valueof zero using the straight-line method, with the lease period as the estimated usefullife.
Of the finance leases that do not transfer ownership rights, those that began before
December 31, 2008 are treated similarly as those applied to regular operating leases.
70

C. Accounting criteria for major allowances
Allowance for doubtful accounts:
The allowance for doubtful accounts consists of the individually estimateduncollectible amounts with respect to certain identified doubtful receivables and theamounts calculated using the rate of actual collection losses with respect to the otherreceivables.
Allowance for employees’ bonuses:
An allowance for employees’ bonuses is provided at the estimated amount applicableto the consolidated fiscal year under review.
Allowance for employees’ severance and retirement benefits:
The Company and its consolidated subsidiaries make provisions in the necessaryamount of allowance for employees’ severance and retirement benefits deemed tohave accrued during the term, based on each company’s projected benefit obligations
and the pension fund balance as of the end of the consolidated fiscal year underreview.
Actuarial gain or loss is amortized, beginning in the year following the year in which
the gain or loss is recognized, by the straight-line method for a given number of years(mainly ten (10) years) within the employees’ average remaining years of service.
Prior service costs are amortized by the straight-line method within the employees’
average remaining years of service (mainly ten (10) years) from the time they arise.
Allowance for retirement benefits for Directors and Corporate Auditors:
Some of the consolidated subsidiaries calculate the required amount as of the end of
the consolidated fiscal year under review, based on internal regulations, in
preparation for payment of retirement benefits to Directors and Corporate Auditors.
D. Other significant items associated with the preparation of consolidated financial statements
1) Significant hedge accounting method
a. Hedge accounting method
The Company defers gains or losses on its hedges.
For currency swaps, the Company allocates differences in the values of hedging
instruments when such hedges meet all requirements for such allocations. For interest
rate swaps, the Company applies exceptional treatment when the swap in question meetsthe conditions for application of such exceptional treatment.

71

b. Hedging instruments and hedged items
Hedging instruments:

Currency swaps, foreign exchange contracts, interest rate
swaps and commodity swaps

Hedged items:

Transactions in foreign currencies, interest on borrowings
and purchases of raw materialsc. Hedging policy
Derivative transactions are used to avoid risks associated with fluctuations in foreignexchange markets, interest rates and raw materials costs and to reduce the costs offinancing. It is the Company’s policy not to engage in speculative transactions thatdeviate from real demand or in highly leveraged transactions.
d. Method of evaluating the effectiveness of hedging
The Company assesses the effectiveness of its hedges by comparing changes in themarket values of the hedged items and of the hedging instruments over the entire periodof the hedge.
When the Company allocates differences in the values of hedging instruments or when it
accounts for the value of swaps under exceptional treatment, these determinations allow
it to forgo evaluation of the effectiveness of hedges in these cases.
2) Treatment of consumption taxes
Consumption taxes are mainly excluded from the statements of income, except in thecase of non-deductible consumption taxes related to fixed assets that are charged whenincurred.
(5) Method and period of amortization of goodwill
Goodwill is amortized by the straight-line method over a five (5) to twenty (20) years period.

72

2. Notes on Changes in Accounting Policies(Changes in Accounting Policies that are Difficult to Distinguish from Changes in Accounting
Estimates)
In conjunction with the revision of the Corporation Tax Act, the Company and its domestic
consolidated subsidiaries have changed, from the consolidated fiscal year under review, their
method of depreciating tangible fixed assets acquired on and after January 1, 2013 to thedepreciation method pursuant to the revised Corporation Tax Act.
The impact of this change on operating income, recurring profit and income before income
taxes and minority interests in the consolidated fiscal year under review is not material.

3. Notes to the Consolidated Balance Sheets(1) Pledged assets and secured liabilities
The following assets have been provided as collateral for short-term borrowings of¥139 million and long-term borrowings of ¥1,119 million:
Machinery, equipment and vehicles:¥1,825 million(2) Accumulated depreciation of tangible fixed assets:¥819,833 million(3) Contingent liabilities
Guarantees:¥712 million(4) Matured notes at term-end
The balance sheet date for the term fell on a bank holiday, and trade notes with maturity on
the balance sheet date were cleared on the clearing houses the next business day. Current
assets and current liabilities thus respectively include notes receivable and notes payable
with maturity on the balance sheet date as follows:
Notes receivable:¥249 million

Notes payable:¥147 million

4. Notes to the Consolidated Statements of Income
Non-operating expenses
Among non-operating expenses, “Other non-operating expenses” include goodwill
amortization costs of ¥424 million arising in relation to the holding company of affiliates
subject to application of the equity method.

73

5. Notes to the Consolidated Statements of Changes in Net Assets(1) Total number of the issued shares as of the end of the consolidated fiscal year underreview
Common stock

483,585,862 shares(2) Dividends from surplus distributed during the consolidated fiscal year under review
A. It was resolved at the 89th Annual General Meeting of Shareholders of March 26, 2013 as
follows:
Item related to dividends on common stock
Total amount of dividends:¥6,523 million
Dividend per share:¥14
Record date:
December 31, 2012
Effective date:
March 27, 2013
B. It was resolved at the Board of Directors Meeting of August 1, 2013 as follows:
Item related to interim dividends on common stock
Total amount of interim dividends:¥9,740 million
Interim dividend per share:¥21.50Record date:June 30, 2013
Effective date:August 30, 2013
(3) Dividends from surplus to be distributed after the final day of the consolidated fiscal
year under review
The following item has been placed on the agenda for approval at the 90th Annual General
Meeting of Shareholders scheduled for March 26, 2014.
Item related to dividends on common stock
Source of dividends:
Retained earnings
Total amount of dividends:¥9,938 million
Dividend per share:¥21.50Record date:
December 31, 2013
Effective date:
March 27, 201474

(4) Number of shares subject to stock acquisition rights upon exercise thereof at the end of
the consolidated fiscal year under review
The Second Issue of stock acquisition rights (issued March 30, 2004)
Number of stock acquisition rights:

847

Class and number of shares subject to the stock acquisition rights:
84,700 shares of common stock
Amount to be paid in per share upon exercise of the stock acquisition rights:
Exercise period:¥1,205

March 30, 2006 to March 29, 2014

The Third Issue of stock acquisition rights (issued March 30, 2005)
Number of stock acquisition rights:

3,863

Class and number of shares subject to the stock acquisition rights:
386,300 shares of common stock
Amount to be paid in per share upon exercise of the stock acquisition rights:
Exercise period:¥1,374

March 30, 2007 to March 29, 2015

The Fourth Issue of stock acquisition rights (issued March 30, 2006)
Number of stock acquisition rights:

5,543

Class and number of shares subject to the stock acquisition rights:
554,300 shares of common stock
Amount to be paid in per share upon exercise of the stock acquisition rights:
Exercise period:¥1,688March 30, 2008 to March 29, 2016

(5) Treasury stock
Type of stock

Number of shares asof Jan. 1, 2013

Increaseduringthe year

Decreaseduringthe year

Number of shares asof Dec. 31, 2013

Common stock

17,611,484

13,228,513

9,487,436

21,352,561(Reasons for change)
The increase in the number of shares was the result of the following:
Increase resulting from purchases of Less-than-One-Unit Shares from shareholders
upon request:

11,413 shares

Increase resulting from acquisition of treasury stock

13,217,100 shares

The decrease in the number of shares was the result of the following:
Decrease resulting from sales of Less-than-One-Unit Shares to shareholders uponrequest:
333 shares
Decrease resulting from exercise of stock options:
416,400 shares
Decrease resulting from exercise of rights (conversion) of convertible bonds with stockacquisition rights:
9,070,703 shares75

6. Notes on Financial Instruments(1) Financial instruments
A. Policy on handling of financial instruments
The Company and its principal consolidated subsidiaries procure necessary funds via loans
from financial institutions and by issuing commercial paper and bonds while taking into
account the changing business environment. In doing so, the Company and its principal
consolidated subsidiaries consider the balance between direct or indirect financing as well as
short and long-term debt based on fund procurement costs and risk diversification. Looking
to use funds efficiently, the Group introduced a cash management system among theCompany and its principal domestic consolidated subsidiaries to reduce consolidated
interest-bearing debt. If surplus funds are generated temporarily, as a result, the Company
invests it only in safe financial instruments.
The Company’s policy is to use derivatives trading only to hedge risks to be discussed later,and not for speculation.
B. Details of financial instruments and risks
Trade receivables of the Group companies, including notes and accounts receivable andlong-term loans receivable, are exposed to client credit risks. Additionally, foreign currencybased trade receivables are exposed to currency fluctuation risk as well.
Investment securities of the Company and the Group companies include stocks and bonds
regarding business partners and are thus exposed to risks of the stock or bond issuer (i.e., thebusiness partner) as well as market price fluctuation risk. Of these, foreign currency-based
investment securities are exposed to currency fluctuation risk as well.
Trade payables of the Group companies, including notes and trade accounts payable andother accounts payable, generally have a due date of one (1) year or less. Foreign currencybased trade payables are exposed to currency fluctuation risk as well.
Commercial paper, borrowings, and bonds are exposed to liquidity risk, the risk of being
unable to make payment on the due date due to deterioration in the funds procurement
environment. Some of the Company’s borrowings are based on variable interest rates, forwhich the Company hedges risks using interest rate swaps.
Foreign currency-based borrowings are exposed to currency fluctuation risk as well.
Derivatives trades include currency swap transactions and foreign exchange contracts tohedge against foreign exchange fluctuation risks related to foreign-currency based
receivables and payables, interest rate swap transactions to hedge against interest rate risks
on borrowings, and commodity swap transactions and currency option transactions to hedge
against price fluctuation risks when consolidated subsidiaries procure raw materials.
For hedging instruments, hedged items, hedging policy, and method of evaluating the76

effectiveness of the hedging for the hedge accounting, please see “Significant hedge
accounting method” within “Significant accounting policies” discussed earlier.
C. Risk management system relating to financial instruments
1) Credit risk management (managing risks related to business partners not fulfilling
contract obligations)
In accordance with accounting rules, guidelines on handling accounting operations, andaccounts receivable management rules, each business section or sales management sectionof the Group companies regularly monitors trade receivables and long-term loans to major
business partners. The above sections also routinely check the management status ofdeadlines and balances for each business partner. In collaboration with each of the sales
sections, the Group companies monitor non-performing assets and their collection status.
When executing derivatives transactions, the Company as a rule limits its transactions tofinancial institutions with high credit ratings to minimize credit risk.
2) Managing market risks (foreign exchange and interest rate fluctuation risks)
Looking to reduce foreign exchange fluctuation risks on future foreign currency-based
cash flows ascertained by each currency, the Company and its principal consolidated
subsidiaries mainly use foreign exchange contracts. The Company and its principal
consolidated subsidiaries also engage in interest rate swap transactions to avoid interest rate
fluctuation risks relating to borrowings, and in commodities swap transactions to avert risksof fluctuations in raw materials prices.
For investment securities, the Group companies regularly monitor their market values
and financial status of the issuers (the Group company’s business partners). This is to review
the Group company’s holdings on a consistent basis based on its relationship with business
partners.
The Company's Finance Section engages in derivatives transactions in accordance withthe derivatives transaction management rules which stipulate the transaction policy andtrading authority and reports the transactions to the executives in charge of finance pursuant
to the regulation of authority. Consolidated subsidiaries also manage their trading according
to the Company’s rules.
3) Managing liquidity risk related to funds procurement (risk of being unable to makepayment on the due date)Since the Company and its principal consolidated subsidiaries have introduced the cash
management system, the Company manages liquidity risks of those companies participatingin this system.
Based on reports from each section and each company, the Company’s Finance Section
77manages liquidity risk by creating and updating its cash management plan as necessary andby engaging in efficient fund procurement while reducing short-term liquidity.
(2) Market value of financial instruments
The amount recorded on the consolidated balance sheets at the end of the consolidated fiscal
year under review, the market value and the difference between the two are shown below foreach financial instrument. Financial instruments with respect to which the Company considers
deriving the market value to be extremely difficult are not included in the table (see Note 2).
Million yen

Amounts
recorded on the
consolidatedbalance sheets
42,200317,106(2,787)314,318

Market value

Difference(1) Cash and deposits
42,200—(2) Notes and accounts receivable
Allowance for doubtful accounts (*1)
Notes and accounts receivable (net)314,318—(3) Investment securities
A. Shares in affiliates
86,682
235,570
148,887
B. Other securities
104,765
104,765—(4) Long-term loans receivable (*2)
7,646Allowance for doubtful accounts (*3)
(3,778)Long-term loans receivable (net)
3,867
4,006
139
Total assets
551,835
700,862
149,027(1) Notes and trade accounts payable
118,650
118,650—(2) Short-term borrowings
128,971
128,971—(3) Commercial paper
67,00067,000—(4) Other accounts payable
68,45768,457—(5) Deposits received
18,08718,087—(6) Bonds (*4)
168,937
192,082
23,144(7) Long-term borrowings (*5)
38,81239,442629(8) Lease obligations (*6)
23,24524,019774
Total liabilities
632,163656,71124,548Derivatives (*7)
541
541
—
(*1) Allowances for doubtful accounts recorded under notes and accounts receivable are excluded.
(*2) Long-term loans receivable within one (1) year are included.
(*3) Allowances for doubtful accounts recorded individually under long-term loans receivable areexcluded.
(*4) Bonds due within one (1) year are included.
(*5) Long-term borrowings due within one (1) year are included.
(*6) Lease obligations (current liabilities) are included.
(*7) The net amount of receivables and payables accrued from derivatives transactions are indicated.

Note 1. Calculation methods for deriving market values of financial instruments, items
relating to securities and derivatives transactions
Assets(1) Cash and deposits, (2) Notes and accounts receivable
Book value is used because these items are settled in a short time, making their market
value about equivalent to their book value.
(3) Investment securities
Market value at financial instruments exchange is used for stock, whereas the value
indicated by the financial institution with which the Company does business is used
for debt securities and others.
78

(4) Long-term loans receivable
The market value of long-term loans receivable is calculated by discounting the
expected value of principal and interest receivable by the interest rate expected if asimilar new loan were to be issued.
Liabilities(1) Notes and trade accounts payable, (2) Short-term borrowings, (3) Commercial paper,(4) Other accounts payable, and (5) Deposits received
Book value is used because these items are settled in a short time, making their market
value about equivalent to their book value.
(6) Bonds
For bonds the Company issues, market price is used for those that have a market value
and the price indicated by financial institutions with which the Company does
business is used for those without market value.
(7) Long-term borrowings
The market value of long-term borrowings is calculated by taking the total amount ofprincipal and interest and discounting it by the interest rate expected if a new
borrowing were to be taken out, thereby deriving the present value. Long-termborrowings with variable interest rates are subject to exceptional treatment for interest
rate swaps. These are calculated by discounting the total amount of principal andinterest involved in the interest rate swap concerned by the interest rate deemed
appropriate if a similar borrowing were to be taken out.
(8) Lease obligations
The market value of lease obligations is calculated by taking the present value of theobligation concerned – discounting the total amount of principal and interest by theinterest rate expected if a similar, new lease obligation were to be incurred.
Derivatives transactions
The Company considers the price indicated by the financial institution, etc. with which itdoes business as the market value. However, since derivatives transactions subject to
exceptional treatment for interest rate swaps are processed as part of long-term borrowings
subject to hedging, the market value of these derivative transactions are recorded as part ofthe market value of the long-term borrowings concerned.
Note 2. Of securities of affiliates and other securities, those that are unlisted (¥139,979
million recorded on the consolidated balance sheets) do not have a market price andestimating future cash flow is not possible. The Company thus considers deriving
their market value as being extremely difficult and does not include these securities
under“(3) Investment securities”.
7. Notes to per share information(1) Net assets per share:¥1,772.47(2) Earnings per share (Net income per share):

8. Other notes
Figures in amounts of less than one million yen are omitted.
79¥135.73Reference: CONSOLIDATED STATEMENTS OF CASH FLOWS (Summary)

Cash flows from operating activities:
Income before income taxes and minority interests
Depreciation
Amortization of goodwill
Increase (decrease) in allowance for employees’ severance
and retirement benefits
Increase (decrease) in allowance for doubtful accounts
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Increase (decrease) in trade payables
Increase (decrease) in alcohol tax payable
Other cash flows from operating activities
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Net cash provided by operating activities

For the year ended
December 31, 2013

Million yen
For the year ended
December 31, 2012

110,470
62,581
12,46099,84059,365
10,552(2,480)417
3,235(3,089)(1,052)(2,276)
5,674
185,941
5,607(3,845)(30,450)
157,252

1,693
(509)
(8,797)(5,373)(3,399)1,208
2,480
157,062
5,020(4,275)(48,515)
109,292(48,961)(12,549)
3,976—(40,341)(4,741)
1,039
552

Cash flows from investing activities:
Purchase of fixed assets
Purchase of investment securities
Proceeds from sales of investment securities
Proceeds from sales of investments in subsidiaries
Purchase of investments in subsidiaries resulting in change inscope of consolidation
Proceeds from sales of investments in subsidiaries resulting inchange in scope of consolidation
Other cash flows from investing activities
Net cash used in investing activities(2,991)(88,270)(197)(4,981)(65,704)—(2,557)(134,319)

Cash flows from financing activities:
Increase (decrease) in financial liabilities
Purchase of treasury stock
Cash dividends paid
Other cash flows from financing activities
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

(35,017)(30,029)(16,264)(3,627)(84,938)
187
6,796
34,32041,11663,893(13)(12,808)(8,069)43,002
207
18,182
16,13734,32080

NON-CONSOLIDATED FINANCIAL STATEMENTS
NON-CONSOLIDATED BALANCE SHEETS
As of
December 31, 2013ASSETS
Current assets:
Cash and deposits
Short-term loans receivable
Prepaid expenses
Deferred tax assets
Income taxes receivable
Other current assets
Allowance for doubtful accounts
Total current assets
Fixed assets:
Tangible fixed assets:
Buildings
Structures
Machinery and equipment
VehiclesTools, furniture and fixtures
Land
Lease assets
Construction in progress
Total tangible fixed assets
Intangible fixed assets:
Rights to use of facilities
Trademark rights
SoftwareLease assets
Other intangible fixed assets
Total intangible fixed assets
Investments and other assets:
Investment securities
Shares in affiliates
Capital invested in affiliates
Long-term loans receivable from affiliates
Deferred tax assets
Other investments
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
Total assets

23,828334,345
1,479
314
3,705
5,786
(1,366)
368,094

13,772
307
237
1
541
15,037518
124
30,54240
14,752
10,603271
025,66847,287
468,6466,226
3,555
10,1761,314(367)
536,839
593,050
961,144

81

Million yen
As ofDecember 31, 2012
(Reference)

21,113372,836
1,044
198
11,633
13,964(1,040)419,751

14,143
327
163
1
665
15,037438
108
30,88640
15,7168,646
81
024,48436,358463,950
7,388
4,727
14,612
1,184(274)
527,946
583,317
1,003,068

NON-CONSOLIDATED BALANCE SHEETS

As of
December 31, 2013

LIABILITIESCurrent liabilities:
Short-term borrowings
Commercial paper
Bonds due within one year
Lease obligations
Other accounts payable
Accrued expenses
Deposits received
Allowance for employees’ bonuses
Allowance for directors’ and corporate auditors’ bonuses
Other current liabilities
Total current liabilities
Long-term liabilities:
Bonds
Long-term borrowings
Lease obligations
Other long-term liabilities
Total long-term liabilities
Total liabilities

113,650
67,00020,000
325
476
4,016
26,183104
106
250
232,113

148,937
28,200505
73
177,716
409,830

NET ASSETS
Shareholders’ equity:
Capital stock
Capital surplus
Capital reserve
Other capital surplus
Retained earnings
Other retained earnings
General reserve
Retained earnings carried forward
Treasury stock
Total shareholders’ equity

182,531
161,555
130,292
31,262
240,222240,222
195,000
45,222(40,032)
544,276

Valuation and translation adjustments:
Valuation difference on available-for-sale securities
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets
82

7,037
7,037
551,314
961,144

Million yen
As ofDecember 31, 2012
(Reference)

157,550
68,000
—
256
491
3,678
14,934117
112
149
245,290

188,121
21,200290
100
209,712455,002

182,531
159,658
130,292
29,366
233,105
233,105
195,000
38,105(27,763)547,532

533
533
548,065
1,003,068

NON-CONSOLIDATED STATEMENTS OF INCOME

Million yen
For the year ended
December 31, 2013

For the year ended
December 31, 2012
(Reference)

Operating revenue
Operating income of the Group
Rent income from real estate
Dividends from subsidiaries and affiliates
Operating expenses
Operating income
Non-operating income:Interest and dividend income
Foreign exchange gains
Reversal of allowance for doubtful accounts
Other non-operating income
Non-operating expenses:
Interest expenses
Provision of allowance for doubtful accounts
Other non-operating expenses
Recurring profit
Extraordinary gains:
Gain on sales of fixed assets
Gain on sales of investment securities
Gain on sales of shares in affiliates
Gain on liquidation of subsidiaries and affiliates
Extraordinary losses:
Loss on sales and disposal of fixed assets
Loss on devaluation of investment securities
Loss on sales of shares in affiliates
Loss on devaluation of shares in affiliates
Loss on devaluation of equity participation in affiliates
Loss on liquidation of subsidiaries and affiliates
Income before income taxes
Income taxes－current
Income taxes－deferred
Net income

83

50,004
26,117
1,565
22,321
23,701
26,302
2,860
2,186
380
—

293
2,767
1,720
652
394
26,396
357
0
357
—
—
1,348
178
—
129
—
785
254
25,405
1,259
764
23,381

70,16924,822
1,535
43,81022,64847,521
3,352
2,120
—
999
233
3,957
2,358
—
1,598
46,917
20,528—149
18,1372,241
25,684308
755
17,739
4,764
2,115
0
41,761
589
4,963
36,208

NON-CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETSFor the year ended December 31, 2013

Million yen
Shareholders’ equity
Capital surplus

Capital stock

Balance as of Jan. 1, 2013

182,531

Retained earnings
Other retained earnings

Capital reserve

Other capitalsurplus

Total capitalsurplusGeneral reserve

130,292

29,366

159,658

195,000

Total
Retained earnings
retained earnings
carried forward
38,105

233,105

Dividends(16,264)(16,264)

Net income (loss)

23,381

23,381

Changes during the term

Acquisition of treasury
stock
Disposal of treasury stock

1,896

1,896

Other changes in nonshareholders’ equity items
during the term (net)Total changes during the
term

—

—

1,896

1,896

—

7,116

7,116

Balance as of Dec. 31, 2013

182,531130,292

31,262

161,555

195,000

45,222

240,222

Valuation and translation
adjustments

Shareholders’ equity

Balance as of Jan. 1, 2013

Treasury stock

Total shareholders’ equity

Valuation difference on
available-for-sale securities(27,763)547,532

533

Total net assets

548,065

Changes during the term
Dividends(16,264)(16,264)

Net income (loss)

23,381

23,381

Acquisition of treasury
stock(30,029)(30,029)(30,029)

Disposal of treasury stock

17,76019,657

19,657

Other changes in nonshareholders’ equity items
during the term (net)Total changes during theterm(12,268)

Balance as of Dec. 31, 2013

(40,032)

6,504

6,504

(3,255)

6,504

3,248

544,276

7,037

551,31484

NOTES TO THE NON-CONSOLIDATED FINANCIAL STATEMENTS
1. Notes to Significant Accounting Policies(1) Valuation basis and method for securities
Shares in subsidiaries and affiliates:
Stated at cost based on the moving-average method.
Other securities
Securities with market value:
Carried at the average market value for the month immediately preceding the balance
sheet date (related valuation differences are directly charged or credited to net assets,
and the cost of securities sold is computed by the moving-average method).
Securities without market value:
Stated at cost based on the moving-average method.
(2) Valuation basis and method for derivatives
Market price method(3) Valuation basis and method for inventories
Stated at cost determined by the moving-average method (write-downs to net selling value
regarded as decreased profitability).
(4) Depreciation methods for fixed assets
Tangible fixed assets (excluding lease assets):
Tangible fixed assets are mainly depreciated using the straight-line method.
The estimated useful lives of the assets are based on the same standards as thosespecified in the Corporation Tax Act.
Intangible fixed assets (excluding lease assets):
Intangible fixed assets are amortized using the straight-line method.
The estimated useful lives of the assets are based on the same standards as thosespecified in the Corporation Tax Act.
Software for internal use is amortized by the straight-line method over a useful life of
five (5) years. Trademark rights are mainly amortized over twenty (20) years using thestraight-line method.

85

Lease assets:
Finance leases that do not transfer ownership rights are amortized to a residual value ofzero using the straight-line method, with the lease period as the estimated useful life.
Of the finance leases that do not transfer ownership rights, those that began before
December 31, 2008 are treated similarly as those applied to regular operating leases.
(5) Accounting criteria for allowances
Allowance for doubtful accounts:
The allowance for doubtful accounts consists of the individually estimated uncollectible
amounts with respect to certain identified doubtful receivables and the amounts
calculated using the rate of actual collection losses with respect to the other receivables.
Allowance for employees’ bonuses:
An allowance for employees’ bonuses is provided at the estimated amount applicable tothe fiscal year under review.
Allowance for directors’ and corporate auditors’ bonuses:
An allowance for directors’ and corporate auditors’ bonuses is provided at the estimatedamount applicable to the fiscal year under review.
(6) Hedging accounting method
A. Hedging accounting method
The Company defers gains or losses on its hedges.
For foreign exchange contracts, the Company allocates differences in the values of hedging
instruments when such hedges meet all requirements for such allocations. For interest rate
swaps, the Company applies exceptional treatment when the swap in question meets theconditions for application of such exceptional treatment.
B. Hedging instruments and hedged items
Hedging instruments: Foreign exchange contracts and interest rate swaps
Hedged items:

Loans receivable in foreign currencies and interest on borrowings

C. Hedging policy
Derivative transactions are used to avoid risks associated with fluctuations in foreignexchange markets and in interest rates and to reduce the costs of financing. It is theCompany’s policy not to engage in speculative transactions that deviate from real demand orin highly leveraged transactions.
D. Method of evaluating the effectiveness of hedging
The Company assesses the effectiveness of its hedges by comparing changes in the market
values of the hedged items and of the hedging instruments over the entire period of thehedge.
86When the Company allocates differences in the values of hedging instruments or when it
accounts for the value of swaps under exceptional treatment, these determinations allow it toforgo evaluation of the effectiveness of hedges in these cases.
(7) Treatment of consumption taxes
Consumption taxes are excluded from the statements of income, except in the case of nondeductible consumption taxes related to fixed assets that are charged when incurred.

2. Notes on Changes in Accounting Policies(Changes in Accounting Policies that are Difficult to Distinguish from Changes in Accounting
Estimates)
In conjunction with the revision of the Corporation Tax Act, the Company has changed its
method of depreciating tangible fixed assets acquired on and after January 1, 2013 to thedepreciation method pursuant to the revised Corporation Tax Act.
The impact of this change on operating income, recurring profit and income before income
taxes in the fiscal year under review is not material.

873. Notes to the Non-Consolidated Balance Sheets(1) Accumulated depreciation on tangible fixed assets¥29,836 million(2) Contingent liabilities
A. Guarantees, etc., against bank borrowings, etc.
Guarantees:¥23,279 million

B. Guarantees, etc., against derivatives
Guarantees:
Contract amount, etc.:¥4,112 million

Unrealized gains (losses):¥(258) million(3) Monetary claims and obligations with affiliates
Short-term monetary claims on affiliates:¥339,914 million

Long-term monetary claims on affiliates:¥3,555 million

Short-term monetary obligations to affiliates:¥26,085 million

4. Notes to the Non-Consolidated Statements of Income
Transactions with affiliates
Operating revenue:¥49,900 million

Operating expenses:¥1,310 million

Transactions other than operating transactions:¥1,586 million

5. Notes to the Non-Consolidated Statements of Changes in Net Assets
Treasury stock
Type of stock

Number of shares asof Jan. 1, 2013

Increaseduringthe year

Decreaseduringthe year

Number of shares asof Dec. 31, 2013

Common stock

17,611,484

13,228,513

9,487,436

21,352,561(Reasons for change)
The increase in the number of shares was the result of the following:
Increase resulting from purchases of Less-than-One-Unit Shares from shareholders
upon request:

11,413 shares

Increase resulting from acquisition of treasury stock:

13,217,100 shares

The decrease in the number of shares was the result of the following:
Decrease resulting from sales of Less-than-One-Unit Shares to shareholders uponrequest:
333 shares
Decrease resulting from exercise of stock options:
416,400 shares
Decrease resulting from exercise of rights (conversion) of convertible bonds with stockacquisition rights
9,070,703 shares88

6. Notes to tax effect accounting(1) Deferred tax assets and liabilities(Deferred tax assets)
Shares in affiliates due to restructuring:¥19,278 million
Allowance for doubtful accounts, in excess of tax-deductible amount:¥589 million
Allowance for employees’ bonuses, non-tax deductible:¥39 million
Loss on devaluation of investment in subsidiaries, non-tax deductible:¥8,955 million
Loss on devaluation of investment securities, non-tax deductible:¥815 million
Loss on devaluation of capital contributions for subsidiaries,
non-tax deductible:¥5,538 million
Deferred loss on transfer of business between consolidated corporations:¥1,965 million
Others:¥346 million
Subtotal deferred tax assets:¥37,527 million
Valuation allowance:¥(17,388) million
Total deferred tax assets¥20,139 million(Deferred tax liabilities)
Deferred gain on transfer of business between consolidated corporations: ¥(5,801) million
Valuation difference on available-for-sale securities:¥(3,846) million

Total deferred tax liabilities¥(9,648) million

Net deferred tax assets:¥10,491 million(2) Breakdown of main items which caused the difference between the statutory tax rate
and the effective tax rate after adoption of tax effect accounting
Statutory effective tax rates:

37.7%(Adjustments)
Permanent difference (non-deductible), including entertainment expenses:

0.5%

Valuation allowance:

2.0%

Permanent difference (non-taxable), including dividend income:(34.9)%

Gain (loss) on transfer of shares of subsidiaries between consolidated corporations:

4.1%

Tax credit:(0.7)%

Others:(0.7)%

Effective tax rates after application of tax effect accounting:

8.0%

89

7. Notes to related party transactions
Subsidiaries and affiliates
Million yen
TypeCompany

Subsidiary
Subsidiary
Subsidiary
Subsidiary

Subsidiary

Asahi
Breweries,
Ltd.
Asahi Soft
DrinksCo., Ltd.
CalpisCo., Ltd.
AI Beverage
Holdings
Co., Ltd.
Asahi
Holdings(Australia)
Pty Ltd

Percentage
of votingrights, etc.
held
100% directownership
100% directownership
100% directownership
100% directownership
100% directownership

Relationship withrelated party
Interlocking of
directors/corporate
auditors
Interlocking of
directors/corporate
auditors
Interlocking of
directors/corporate
auditors
Interlocking of
directors/corporate
auditors
Interlocking of
directors/corporate
auditors

Description of transaction

Transaction
amountOperating revenue (Note 1)

36,722

Loaning funds (Note 2)
Operating revenue (Note 1)(40,471)
5,433

Loaning funds (Note 2)

208

Balance as ofDec. 31, 2013

Account item—
Short-term loans
receivable—
Short-term loans
receivable

256,879—

10,56623,158Deposits received (Note 3)

7,064

Deposits
received

Loaning funds (Note 2)(1,295)

Short-term loans
receivable

Guarantees for liabilities(Note 4)

14,815——28,092—

Terms and conditions of transaction and policy, etc. on determination thereof
Note 1. Operating revenue is determined in accordance with certain reasonable standards inorder to provide supervision, guidance, etc., regarding business management.
Note 2. The interest rate for the loans receivable is reasonably determined, taking the market
interest rate into consideration.
For the transaction amount, the amount of net increase (decrease) in the fiscal year
under review is stated.
Note 3. The interest rate for the deposits received is reasonably determined, taking the market
interest rate into consideration.
For the transaction amount, the amount of net increase (decrease) in the fiscal year
under review is stated.
Note 4. The Company guaranteed bank loans in the amount of A$159 million.
8. Notes related to leased fixed assets
Separately from the fixed assets carried on the balance sheets, some software packages aretreated based on finance lease agreements that do not transfer ownership rights.
(1) As of the end of the fiscal year under review
Amount equivalent to acquisition costs:¥14 million(2) As of the end of the fiscal year under review
Amount equivalent to accumulated depreciation and amortization:¥12 million(3) As of the end of the fiscal year under review
Amount equivalent to prepaid lease rents:90¥2 million

9. Notes to per share information(1) Net assets per share:¥1,192.72(2) Earnings per share (Net income per share):

10. Other notes
Figures in amounts of less than one million yen are omitted.

91¥51.39

AUDIT REPORT
Independent accounting auditor’s report on consolidated financial statements
Independent Auditor’s ReportFebruary 6, 2014
The Board of Directors
ASAHI GROUP HOLDINGS, LTD.

KPMG AZSA LLC
Hiroyuki Sakai (Seal)
Designated Limited Liability Partner
Engagement Partner
Certified Public Accountant
Hirotaka Tanaka (Seal)
Designated Limited Liability Partner
Engagement Partner
Certified Public Accountant
Yukihiko Ishiguro (Seal)
Designated Limited Liability Partner
Engagement Partner
Certified Public Accountant
We have audited the consolidated financial statements, comprising the consolidated balance sheet, theconsolidated statement of income, the consolidated statement of changes in net assets and the related
notes of ASAHI GROUP HOLDINGS, LTD. as at December 31, 2013 and for the year from January 1,
2013 to December 31, 2013 in accordance with Article 444-4 of the Companies Act.
Management’s Responsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with accounting principles generally accepted in Japan, and for such internal
control as management determines is necessary to enable the preparation of consolidated financial
statements that are free from material misstatements, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on the consolidated financial statements based on our audit as
independent auditor. We conducted our audit in accordance with auditing standards generally acceptedin Japan. Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the consolidated financial statements. The procedures selected depend on our judgement, including theassessment of the risks of material misstatement of the consolidated financial statements, whether due tofraud or error. In making those risk assessments, we consider internal control relevant to the entity’s
preparation and fair presentation of the consolidated financial statements in order to design audit
procedures that are appropriate in the circumstances, while the objective of the financial statement audit is92

not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit
also includes evaluating the appropriateness of accounting policies used and the reasonableness ofaccounting estimates made by management, as well as evaluating the overall presentation of theconsolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion.
OpinionIn our opinion, the consolidated financial statements referred to above present fairly, in all material
respects, the financial position and the results of operations of ASAHI GROUP HOLDINGS, LTD. andits consolidated subsidiaries for the period, for which the consolidated financial statements were prepared,in accordance with accounting principles generally accepted in Japan.
Other Matter
Our firm and engagement partners have no interest in the Company which should be disclosed pursuant to
the provisions of the Certified Public Accountants Law of Japan.

Notes to the Reader of Independent Auditor’s Report:
The Independent Auditor’s Report herein is the English translation of the Independent Auditor’s Report
as required by the Companies Act.

93

Independent accounting auditor’s report on non-consolidated financial statements
Independent Auditor’s ReportFebruary 6, 2014
The Board of Directors
ASAHI GROUP HOLDINGS, LTD.

KPMG AZSA LLC
Hiroyuki Sakai (Seal)
Designated Limited Liability Partner
Engagement Partner
Certified Public Accountant
Hirotaka Tanaka (Seal)
Designated Limited Liability Partner
Engagement Partner
Certified Public Accountant
Yukihiko Ishiguro (Seal)
Designated Limited Liability Partner
Engagement Partner
Certified Public Accountant
We have audited the non-consolidated financial statements, comprising the non-consolidated balance
sheet, the non-consolidated statement of income, the non-consolidated statement of changes in net assets
and the related notes, and the supplementary schedules of ASAHI GROUP HOLDINGS, LTD. as at
December 31, 2013 and for the year from January 1, 2013 to December 31, 2013 in accordance with
Article 436-2-1 of the Companies Act.
Management’s Responsibility for the non-consolidated Financial Statements and Others
Management is responsible for the preparation and fair presentation of the non-consolidated financial
statements and the supplementary schedules in accordance with accounting principles generally acceptedin Japan, and for such internal control as management determines is necessary to enable the preparation of
non-consolidated financial statements and the supplementary schedules that are free from material
misstatements, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on the non-consolidated financial statements and the
supplementary schedules based on our audit as independent auditor. We conducted our audit inaccordance with auditing standards generally accepted in Japan. Those standards require that we planand perform the audit to obtain reasonable assurance about whether the non-consolidated financial
statements and the supplementary schedules are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the non-consolidated financial statements and the supplementary schedules. The procedures selected
depend on our judgement, including the assessment of the risks of material misstatement of the nonconsolidated financial statements and the supplementary schedules, whether due to fraud or error. In
making those risk assessments, we consider internal control relevant to the entity’s preparation and fairpresentation of the non-consolidated financial statements and the supplementary schedules in order to94design audit procedures that are appropriate in the circumstances, while the objective of the financial
statement audit is not for the purpose of expressing an opinion on the effectiveness of the entity’s internal
control. An audit also includes evaluating the appropriateness of accounting policies used and thereasonableness of accounting estimates made by management, as well as evaluating the overall
presentation of the non-consolidated financial statements and the supplementary schedules.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion.
OpinionIn our opinion, the non-consolidated financial statements and the supplementary schedules referred toabove present fairly, in all material respects, the non-consolidated financial position and the results ofoperations of ASAHI GROUP HOLDINGS, LTD. for the period, for which the non-consolidated
financial statements and the supplementary schedules were prepared, in accordance with accounting
principles generally accepted in Japan.
Other Matter
Our firm and engagement partners have no interest in the Company which should be disclosed pursuant to
the provisions of the Certified Public Accountants Law of Japan.

Notes to the Reader of Independent Auditor’s Report:
The Independent Auditor’s Report herein is the English translation of the Independent Auditor’s Report
as required by the Companies Act.

95

REPORT OF THE BOARD OF AUDITORSThe Board of Auditors has prepared the following report based on the audit reports prepared byindividual Corporate Auditors related to the Directors’ execution of their duties during the 90th fiscal year,
the period from January 1, 2013 to December 31, 2013, after due discussions and consultations among the
Corporate Auditors.

1. Methods used in audits by the individual Corporate Auditors and by the Board ofAuditors and content of audits(1) The Board of Auditors determined the audit policies and division of duties, and received reports fromeach Corporate Auditor regarding the status and results of the audits, as well as reports from the
Directors and Independent Accounting Auditor on the execution of their duties, and requested
explanations of those reports when necessary.
(2) Each Corporate Auditor sought to achieve mutual understanding with the Directors, sections incharge of internal audit and other employees, and strove to collect information and create an audit
environment in accordance with the audit policies and division of duties based on the audit standards
established by the Board of Auditors. The Corporate Auditors also attended meetings of the Board of
Directors and other important meetings, received reports from Directors and other employees
regarding the execution of their duties and requested explanations when necessary, reviewed
documents related to important decisions, and inspected the operations and property of the head
office and other locations. With respect to “systems to ensure appropriate execution of Directors’
duties in conformity with laws and regulations and the articles of incorporation, and other systems toensure appropriate business operations (internal control systems)” (Item 6, Paragraph 4, Article 362of the Companies Act and Paragraph 1 and 3, Article 100 of the Ordinance for Enforcement of theCompanies Act) that is included in the Business Report, the Board received reports regularly from
Directors and other employees regarding the status of the establishment and implementation of thesystems, sought additional explanations as necessary and expressed opinions thereon. As regards“basic policy concerning the persons who control decisions on the Company’s financial and business
policies” (Item 3, Article 118 of the Ordinance for Enforcement of the Companies Act) included in
the Business Report, based on discussions with the Board of Directors and other parties. With respect
to subsidiaries, the Corporate Auditors took steps to facilitate communications with the Directors andCorporate Auditors of subsidiaries and, when necessary, received reports from subsidiaries on thestatus of their businesses. Using the foregoing methods, the Corporate Auditors reviewed theBusiness Report and the supplementary schedules thereto for the fiscal year under review.
(3) The Board of Auditors oversaw and verified that the Independent Accounting Auditor maintained its
independence and carried out appropriate audits, moreover, and received reports from the
Independent Accounting Auditor regarding the execution of its duties and requested explanations
when necessary. The Board also received notifications from the Independent Accounting Auditor to
the effect that “a system for the maintenance of appropriate execution of duties” (included in Article
131 of the Corporate Calculation Regulations) in accordance with the “standards for quality control ofaudits” (Business Accounting Council; October 28, 2005), and requested explanations whennecessary. Based on the above activities, the Board of Auditors examined the non-consolidated
financial statements (non-consolidated balance sheets, non-consolidated statements of income, nonconsolidated statements of changes in net assets, and notes to the non-consolidated financial
96

statements), supplementary schedules, and the consolidated financial statements (consolidatedbalance sheets, consolidated statements of income, consolidated statements of changes in net assets,
and notes to the consolidated financial statements) for the business year under review.

2. Results of the Audit(1) Results of audit of the Business Report







In our opinion, the Business Report and the supplementary schedules thereto present thesituation of the Company fairly, in compliance with the provisions of applicable laws andregulations and the Articles of Incorporation.
In our opinion, there are no wrongful acts or material violations of applicable laws andregulations or the Articles of Incorporation in the execution of their duties by the Directors.
In our opinion, the content of the resolution by the Board of Directors regarding internal control
systems is appropriate, and, furthermore, content of the Business Report regarding the internal
control systems and the execution by the Directors have been appropriate.
In our opinion, the Company’s basic policy concerning the persons who control decisions on the
Company’s financial and business policies in the Business Report is appropriate. We
acknowledge that the measures implemented to achieve this basic policy are consistent with thebasic policy, will not harm the common interest of the Company’s shareholders, and serve thepurpose of maintaining the positions of the Company’s Directors and Corporate Auditors.

(2) Results of the audit of non-consolidated financial statements and the supplementary schedules thereto
In our opinion, the auditing methods used by KPMG AZSA LLC, the Independent Accounting
Auditor, and the results of its audit are appropriate.
(3) Results of the audit of consolidated financial statements
In our opinion, the auditing methods used by KPMG AZSA LLC, the Independent Accounting
Auditor, and the results of its audit are appropriate.

February 7, 2014
Board of Auditors
Asahi Group Holdings, Ltd.
Yoshihiro Tonozuka (Seal)
Standing Corporate Auditor
Yukio Kakegai (Seal)
Standing Corporate Auditor

Naoto Nakamura (Seal)
Outside Corporate Auditor
Tadashi Ishizaki (Seal)
Outside Corporate Auditor(Note) Takahide Sakurai ceased to serve as Outside Corporate Auditor as he passed away on January 3,
2014.

97