August 6, 2020
Asahi Group Holdings, Ltd.

Fiscal 2020 2Q Financial Results Conference Call
Date & Time: Thursday, 6th August, 2020
15:30-17:00 Japan Standard Time
Speakers: Akiyoshi Koji, President and Representative Director, CEO
Atsushi Katsuki, Senior Managing Director, CFO◆ H1 2020 Summary & 2020 Forecast1 2020
＜Executive Summary＞• In the first half of this year, group-wide revenue declined 11% year on year, while core
operating profit was down 41%. This was mainly due to a contraction in on-premise
consumption of beer and beer-type beverages both in Japan and overseas owing to theCOVID-19 pandemic.
• In Japan, bar and restaurant demand for Super Dry was lackluster, while Soft Drink
Business vending machine sales and sales of Mintia in the Food Business also struggled.
Overseas too, our company strengths continued to be hit mainly by the negative impact
of shrinking sales in the highly profitable commercial-use channel.
• Meanwhile, we were able to significantly expand our glocal growth platform by completingthe acquisition of Australia’s Carlton & United Breweries on June 1. We have already kicked
off in earnest a business integration project aimed at creating synergies.
• However, considering that this large-scale acquisition came during the time of a global
pandemic, securing cash flow and guaranteeing financial soundness under a suitablefinance plan will present challenges.
• Given this situation in the first six months, our full-year forecasts indicate a revenue
decline of 4% and a decrease in core operating profit of 31%. We factor in a more
moderate COVID-19 impact going forward, as well as benefits from the consolidation of
the CUB business from June onwards.
• In the second half, we will aim to meet our targets with a flexible marketing strategy thatcan respond to local changes; for example, we have already started strengthening the offtrade channel and reviewing core brands so that we can respond to low-price pressureand down-trading.
• Also, in addition to accelerating the pace of profit structure reforms mainly by streamlining
fixed costs and keeping a lid on capital expenditure, we plan to extend returns toshareholders with an optimal finance plan and stable dividend increases.
• Furthermore, in anticipation of structural changes in the so-called “new normal”, not onlywill we continue with our premium strategy and the building of our three-pillar global
platform, we also plan to carry out management reforms with an emphasis on resilience,
flexibility, robustness, and sustainability.
＜Impact of COVID-19 (beer by region)＞• Turning to page 2, I would like to discuss the impact of COVID-19 in each business.
• This slide shows sales of beer-type beverages in each region, including our forecasts forJuly.
• While the impact varied from region to region, as the pandemic started spreading fromMarch onwards, sales of mostly on-premise beer-type beverages declined mainly because
people refrained from going out or were under lockdown.
• Sales then bottomed out in April and we can see that there was a recovery from May
because governments eased restrictions, among other factors.
＜Impact of COVID-19 (Soft Drinks & Food)＞• Page 3 shows monthly sales trends for the Soft Drinks Business and Food Business. In
similar fashion, sales bottomed out in April and vending machine and Mintia sales are still
recovering, but in terms of year-on-year figures, the situation remains very challenging.
• The table at the bottom of the page shows the progress of recovery in each business andour sales projections for the second half taking into account ongoing social distancing. The
earnings forecasts we have just announced are based on these figures.
• That said, because we have not gone so far as to factor in additional rounds of full-fledged
societal restrictions in the event of a second or third wave, we will disclose our earnings
forecasts again if a change in circumstances means we have to revise them.
＜Response Policy for COVID-19＞• Looking at page 4, I would like to discuss how we are responding to the COVID-19 crisis.
• As I mentioned at the 1Q results briefing, we publicly announced Response Policy for
COVID-19 in April. We are working to fulfil our responsibilities to all of our stakeholders
by focusing our attention on countermeasures to respond to each of the three phases
displayed.
• We are currently shifting from the spread of infection phase to the recovery phase, but inthe new normal phase up ahead, I believe the resilience of our business overall will hingeon our ability to discern the structural changes in society at large and swiftly take action.
＜Direction of Reforms to Adapt to the “New Normal”＞• Page 5 summarizes the direction of our management reforms in addressing the structuralchanges that have already materialized and those that we expect will occur up ahead ineach group of stakeholders—namely, consumers, business partners, employees andsociety.
• I personally think that the COVID-19 crisis has propelled us 10 years into the future andas I mentioned a few moments ago, I believe our management reforms, which are focusedsquarely on the new normal for society, must emphasize the four aspects of resilience,flexibility, robustness, and sustainability.
• First, in terms of changes in consumer sentiment, we think a polarization in theconsumption structure will develop because we are currently seeing a down-trading trend
take place with people tightening their purse strings as they continue to choose not to goout and instead drink at home more often, while in Europe premiumization continues toprogress among households.
• Furthermore, we believe that COVID-19 will only further drive demand for highly
trustworthy and safe brands, as well as products that appeal to health-conscious
consumers.
• In responding to this structural change, we are reviewing how we can flexibly allocate
resources to respond to this down-trading trend in the market. For example, in Japan weare looking to strengthen our new genre brands, while in overseas markets, we will dothe same for brands in the mainstream segment.
• At the same time, with the goal of fully reaping the benefits of a recovery in premium
consumption, we will aim to enhance the sustainability of our premium strategy—which
we consider a pillar of earnings growth—mainly by investing in the core premium brandsof each country and bolstering our lineup of non-alcohol beer.
• From the perspective of our business partners, sales at bars, restaurants, and other onpremise channels continue to shrink and we think an increasing number of entities will
end up joining forces with each other based on the assumption that the market will neverfully recover.
• Also, as e-commerce and other online channels become increasingly mainstream, we need
to be prepared for the risk of our supply chains being severed.
• With the aim of driving a recovery in the on-premise channel, we will deploy various
measures to support the business continuity of our business partners and also promote
more efficient operations in response to decreased demand.

• And in addition to stepping up our response to digitalization, although businessreorganization is already underway in Europe and Australia, we will seek to establish more
efficient organizational structures by consolidating shared functions in each region, forexample.
• From the viewpoint of employees and society, we will prioritize the safety of our employees
and accordingly further establish teleworking. The work styles of employees engaged insales, production, and logistics are also diversifying.
• Furthermore, we anticipate that ESG initiatives aimed at supporting employees and society
will become more important than ever before in terms of how corporations are evaluated.
• We make active use of ERM in anticipation of all sorts of risks, but going forward we intend
to further reinforce our crisis management practices so that we can deal with these kindsof pandemics.
• We also plan to further deepen our initiatives on ESG issues and invest in the digitaltransformation of the company on the assumption of increased teleworking. For example,
on August 3 we announced the launch of a new remote working style for employees.
• By moving to steadily execute these management reforms in anticipation of the newnormal up ahead, I think we can make the recovery in Asahi’s robustness a powerful one.
＜Purpose and Outline of Acquisition of CUB Business＞• Turning to page 6, I would like to discuss the CUB business, the acquisition of which wascompleted on June 1.
• The acquisition of CUB is part of our medium-term strategy to expand our global
foundations for growth. Not only will profitability be boosted through the creation ofsynergies, but the establishment of a global platform with the three core pillars of Japan,
Europe, and Australia, will enable us to vigorously drive glocal growth strategies.
• As you can see at the bottom of the slide, CUB boasts a strong portfolio of brands acrossall categories as Australia’s number one beer company, and a level of profitability thatranks alongside other top global players.
＜Australian Market and Major Brands＞• Page 7 gives an overview of the Australian beer market. At 3%, the premium market,
which includes international premium beer, has the highest annual growth rate of all
market segments.
• And as you can see in the pie chart on the right, CUB holds the leading brand Corona in
its portfolio in the imported premium beer category, so together with our leading brands
Peroni and Super Dry, we are well placed to establish an overwhelming competitive
advantage in the market going forward.

• Also, in addition to Carlton, the leading brand in Australia, CUB boasts exceptional
marketing know-how and product development capabilities. For instance, they were able
to quickly nurture the Great Northern brand into the number one brand in the expanding
low-alcohol, easy-drinking beer category.
＜Medium-term Strategy and Overview of Oceania Business＞• Page 8 details our medium-term strategy for the Oceania business and provides an
overview of the business. With the addition of CUB, we will aim to further increase ourmarket presence in Oceania as a comprehensive alcohol and soft drinks company.
• Revenue in the existing Oceania business is roughly the same level as that for CUB. Undera regional hub framework and guided by a project called Alliance for Growth, we areworking to share our business philosophy and starting to give shape to initiatives geared
towards the creation of synergies over the short and medium term.
• We will also boost the sophistication of the Oceania business’s managerial resources as akey base in our global platform by not only integrating our brands and infrastructure, butalso by merging CUB’s talented human resources and know-how into the business.
＜Creating Synergies in Oceania Business＞• Page 9 shows specific initiatives for generating synergies. In terms of top-line synergies,
we aim to harness CUB’s far-ranging distribution network and achieve further growth in
the imported premium brands that I mentioned earlier, such as Super Dry and Peroni.
• We will also look to create new growth drivers by expanding distribution routes for RTD
beverages and soft drinks and also by uniting our respective marketing capabilities andproduct development know-how.
• As for cost synergies, we will aim to leverage economies of scale to generate 10 billion
yen or more in synergies over the next five years or so mainly by building optimal
production and distribution systems, strengthening procurement capabilities, andstreamlining IT and shared services.
• Quantifying all of the top-line synergies is not easy, but we plan to do so gradually, startingwith growth targets for imported premium brands and non-alcoholic beverages.
• Due to the impact of COVID-19, we anticipate lower earnings in the CUB business in thenear term, but over the longer term we see ample potential for sustained profit growth inAustralia where economic growth will likely be driven by stable population growth and theabundance of resources.
• Despite the extremely tough operating environment brought on by the COVID-19 crisis,
we will still aim to aggressively expand our global business together with our highly
motivated new colleagues and put into practice our “Glocal Value Creation Management”.