Asahi Group Holdings, Ltd.
Q1 2024 Financial Results Briefing: Summary of Conference Call (1)Date: Tuesday, May 14, 2024, 18:00-19:00
Presenter: Atsushi Katsuki, President and Group Chief Executive Officer,Representative Director◆Executive Summary (P1)
• In the three months from January to March 2024, the Asahi Group Holdings was ableto achieve 5.1% growth in revenue and an 8.4% increase in Core Operating Profit
despite a generally tough business environment burdened by continued global
inflationary pressures and high costs.
• We have been pursuing appropriate pricing strategies since 2022 to address significant
cost increases. That pricing strategy, in addition to our efforts to strengthen our global
brands and progress our premium strategy, helped generate an increase in revenue
that was in line with our plan.
• We achieved a higher-than-planned increase in Core Operating Profit in the first quarter of2024. While profit contracted in Oceania in the face of a greater deterioration in the market
environment than we had anticipated, our operations in Japan and Europe helped drive theoverall profit increase on the back of improved unit sales prices and greater efficiencies.
• Looking at overall progress in the first quarter, we noted some specific strengths andweaknesses in each region. However, we aim to achieve our overall plan by further
improving our competitive advantage and reforming our earnings structures while also
keeping a close eye on demand trends associated with inflationary outlooks.
• Furthermore, we will accelerate our quest to achieve true globalization under our new
Group governance structure launched in April and will work to further enhance corporate
value by ensuring financial soundness and optimal cash allocations.
◆Premium Strategy Progress (P2)• To illustrate the progress made on our premium strategy, here we have displayed firstquarter unit sales prices for our Beer-Type Beverages and Non-Alcohol Beer Categories
1and sales volumes for our global brands.
• In the first quarter, unit sales prices continued to increase steadily across all three regions,despite the decline in sales volume in Oceania.
• Unit sales prices were mainly boosted by the impact of price revisions from fiscal 2023. Ourefforts to expand premium categories and propose new value in each region also
contributed to the increase in unit prices.
• Looking specifically at our global brands, sales volume of Peroni Nastro Azzurro declined
by 7% YoY due to slugglish conditions in the U.K. and Australia. Meanwhile, sales volumeof Asahi Super Dry rose 34% YoY on the back of sponsorship activities, which are helping
to expand the label’s global presence as a flagship brand.
• While the market environment in Oceania deteriorated in the first quarter, overallprofitability in Japan and Europe increased as we maintained, and even improved, ourcompetitive advantage.
• We must consider the impact of inflation from the second quarter of 2024 and the risk of
not achieving our targets in Oceania. For that reason, we have decided not to change ourfull-year forecasts at this stage. Instead, we will keep a keen eye on sales trends in Japanand Europe, which are entering their peak demand period, and consider reviewing ourplans for each business following the announcement of our first half results.
• At this stage, we believe that the downturn in the Oceania market environment will prove
temporary and will not significantly impact our competitive advantage.
• To help achieve our plan for the Group as a whole, we will enhance efforts to use ourAGPRO procurement organization that went into full-scale operation in January tostrengthen our global procurement function, and accelerate specific initiatives designed toreform profit frameworks in each region.
• In addition to achieving our performance targets for each business year, we strive tomaximize corporate value by reaping the full benefits of investments in our premium andcore strategies and rewarding our shareholders, employees, and all other stakeholders
accordingly.
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