Asahi Group Holdings, Ltd.
Fiscal 2022 Q1 Financial Results Conference Call
Date & Time: Monday, May 16, 2022
16:00-17:00 Japan Standard Time
Speaker: Osamu Ishizaka,
Head of Corporate Communications, Executive Officer

Revenue and Core Operating Profit (P1)
• Total revenue in the first quarter rose 7.1% year on year to 496.9 billion
yen on the back of higher sales driven mainly by a COVID-19 recovery insales of beer primarily in Japan and Europe.
• We have not disclosed quarterly earnings forecasts, but sales overall are
currently tracking below plan. They are on target in Europe and Oceania,
but in Japan, the impact of tighter restrictions aimed at preventing thespread of the Omicron variant meant sales came in lower than expected.
• Core Operating Profit overall decreased 14.7% year on year to 24.7 billion
yen owing to profit declines in mainly Japan and Oceania chiefly as a resultof higher costs of raw materials and utilities in each business.
• Core Operating Profit is ahead of plan in all businesses, reflecting mainly
efforts to further reduce costs in each business.
• At the same time, the cost of raw materials and utilities is currently
skyrocketing due to the impact of the situation in Ukraine.
• If we were to assume that the current market prices continue as they are
now, the impact of such higher costs on full-year earnings would likely
amount to an additional 20.0 billion in Group-wide costs.
• With market conditions still volatile, making accurate forecasts at this point
in time is difficult, but as we continue to consider what extra measures to1

employ in each region going forward, if we see the need to revise our fullyear earnings forecasts, we will do so and disclose them at our second
quarter results briefing.
Operating Profit and Profit Attributable to Owners of Parent (P2)
• Operating profit declined 82.7% to 9.0 billion yen, mainly reflecting thedropout of the year-earlier gain on the sale of non-current assets and thebooking of an impairment loss incurred from the SCM reorganization in
Japan that we announced in February.
• Operating profit overall is tracking ahead of plan by virtue of mainly theovershoot in Core Operating Profit and efforts aimed at curbing businessintegration expenses.
• Profit attributable to owners of the parent company fell 86.9% to 4.3 billion
yen owing to the decrease in operating profit.
• After stripping out the loss recorded from the SCM reorganization, adjusted
profit attributable to owners of the parent comes to 13.3 billion yen, down
59.9% year on year.
Sales by Region (P3)
• In Japan, the on-premise market proved to be more challenging than we
expected because of the enforcement of a quasi-state of emergency inJanuary in response to the spread of the Omicron variant.
• However, total sales in the off-premise market were up year on year owing
to sharp sales growth for mainly Super Dry and Asahi Nama Beer Maru F.
• In Europe, sales were up year on year after rebounding from last year’s
strict lockdowns, even though they were partially impacted by restrictions
enforced again in November.
• Restrictions began to be lifted in multiple countries from March onwards, soup ahead we can expect to see a recovery in demand centering on the onpremise market.
2• In Australia, on-premise demand weakened in January as infections spread,
while March sales were negatively impacted by the later timing of the Easter
holiday period. Still, on-premise sales turned to a recovery from February
when infections peaked out.
• Looking ahead, a number of uncertainties still remain, such as the risk of aresurgence in infections in each region and impacts of the war in Ukraine,
but because restrictions are gradually being eased in each country, we
expect the recovery in on-premise markets to continue.
Japan (P4)
• Total revenue in Japan rose 5.8% year on year to 258.4 billion yen on theback of sales growth in the Alcohol Beverages Business owing to brisk salesof mainly canned beer, which was enough to offset lower sales in the NonAlcohol Beverages Business stemming from deterioration in the category
mix and channel mix.
• Total Core Operating Profit dipped 11.8% year on year to 11.9 billion yen.
The decrease owes mainly to lower profit in the Non-Alcohol Beverages
Business and the “ other ” segment as a result of sluggish restaurant
businesses, despite the Alcohol Beverages and Food businesses posting
profit growth and absorbing raw material cost increases with mainly higherrevenue growth.
• Operating profit overall is slightly ahead of plan. The Alcohol Beverages andNon-Alcohol Beverages businesses are on target, while the Food Businessis outpacing our forecast after streamlining fixed costs.
Alcohol Beverages Business (Revenue/Sales Volume of Beer-type
Beverages (P5)• As shown in the table at the bottom right of this slide, total sales volume
for beer-type beverages in the three months from January to March isestimated to have expanded by around 0% to 1% year on year on the backof beer market growth driven by canned beer, despite the happoshu andnew genre markets contracting.
3• In this environment, even though sales of new genre products were below
the market average, sales of mainly canned beer outpaced the market
average, driven by the effects of a full revamp of Super Dry plus solid resultsfor Asahi Super Dry Nama Jokki Can and Asahi Nama Beer Maru F. As aresult, total revenue for beer-type beverages increased 13.4% year on year.
• As for sales of non-beer-type alcohol beverages, non-alcohol beer/RTD grew
18.6% year on year, reflecting the brisk performance of Dry Zero andgrowth in minimal alcohol products.
Asahi Super Dry Initiatives (P6)
• I would now like to briefly mention the full makeover of Super Dry that wecarried out in March.
• With the canned beer market continuing to expand since the enactment ofliquor tax revisions in October 2020, we aggressively launched a slew of instore promotions and advertisements climaxing in the week of March 17 tomark the birth of Asahi Super Dry.
• As a result, sales of Super Dry cans rose a sharp 21% year on year in theJanuary–March quarter, whilst consumer surveys indicated a significantly
higher level of satisfaction and intent to purchase the product again
compared to before the relaunch. We are also seeing a steady increase in
the number of Super Dry consumers.
• Going forward, while we anticipate higher costs on multiple fronts in thedomestic Alcohol Beverages Business, our policy will be to continue making
brand-building investments in the beer market to keep up with risingdemand and maintain and expand on the currently strong momentum witha view to the liquor tax revisions slated for next October.
Alcohol Beverages Business (Core Operating Profit) (P7)• Core Operating Profit in the Alcohol Beverages Business increased 12.9%
year on year to 9.9 billion yen. The main contributing factors were a boost
to revenue from predominantly beer-type beverages and the streamlining4

of “other” expenses, which outweighed higher variable costs such as raw
materials and aluminum and more money spent on advertising and sales
promotions.
• Compared to our target, even though the change in sales, category, andcontainer mix came in below plan, Core Operating Profit overall is on track
mainly because we successfully streamlined general fixed costs, including
advertisement and sales promotion expenses for the on-premise market.
• As for the price hikes scheduled to take effect from October that weannounced last month, the effects will be limited because only three monthsof this year will be subject to higher prices and we anticipate a temporary
spike in demand at the end of September, but our policy up ahead will beto strengthen our measures, including how we respond to higher costs nextyear.
Non-Alcohol Beverages Business (Sales Volume) (P8)• The soft drinks market overall expanded approximately 2% in the January–
March quarter on the back of strong sales for relaunched or new tea andmineral water products from various companies, despite weaker sales ofcoffee and energy drinks.
• In this environment, total sales volume at Asahi Soft Drinks dipped 0.1%
year on year to 51.73 million cases. This mostly reflects a decrease in coffee
sales owing to the absence of the impact of last year’s new product launchesand revamps, even though sales of carbonated soft drinks and tea werehigher than the same period last year due to core brand makeovers andnew products hitting the stores.
• Despite sales of carbonated soft drinks and tea beating our forecasts, total
sales are tracking below plan because of the lackluster performance ofcoffee and lactic acid drinks, among other products.
• We will aim to stage a turnaround in sales volume in this business by not
only revamping our core brands, but also by launching new products in thesugarless drinks category—an area in which demand continues to grow5

stronger.
Non-Alcohol Beverages Business (Core Operating Profit) (P9)
• Total Core Operating Profit in the Non-Alcohol Beverages Businessdecreased 45.8% year on year to 2.4 billion yen. The main contributing
factors were weak sales in the coffee category following brisk results lastyear, as well as product mix deterioration, plus cost increases for sugar andother raw materials. These negative factors outweighed our best efforts totweak various fixed costs and bring down variable costs throughimprovements in capacity utilization.
• Still, compared to our target, despite the larger-than-expected decline inrevenue, Core Operating Profit overall is on track mainly by virtue ofadditional fixed cost streamlining.

We will aim to meet our target bycontinuing to strengthen existing brands primarily in the carbonated softdrinks category and expand into new domains.
Europe (Revenue and Core Operating Profit) (P10)• As you can see in the table in the middle of the slide, even though thespread of the Omicron variant had an impact, total sales volume grew 7.4%
year on year, driven by a recovery in the on-premise market compared tolast year when much of Europe was subject to lockdowns.
• Looking at the table at the top of the slide, you can see that revenue
increased 26.2% year on year, supported by the recovery in on-premisedemand and an improvement in unit prices, including price hikes
implemented throughout Europe.
• Core Operating Profit surged 349.9% year on year, buoyed by higher sales,including channel and brand mix improvements, which outweighed
increased brand-building investments and higher input costs triggered byskyrocketing market prices.
• Compared to our forecasts, the topline is more or less on target partly
because we factored in the impact of Omicron at the start of the year, while
Core Operating Profit is slightly ahead of plan at this stage chiefly because6we have endeavored to improve overall cost efficiency.
• The table at the bottom shows how sales are faring in each channel. Sales
volume in the off-premise channel declined by roughly mid-single digits year
on year as demand returned to the on-premise channel, even though westrengthened our offerings of core premium brands and non-alcohol beer.
• Overall sales volume in the on-premise channel increased by more than
twofold year on year as demand recovered sharply in all countries in theabsence of the year-earlier lockdowns.
• Going forward, we will need to keep a close eye on market prices for raw
materials and the like, as well as inflation-influenced trends in consumption,
but we still intend to target a sustained recovery in topline growth centeringon our premium brands and improve our channel mix.
• Page 11 shows sales volume trends for our key markets in Europe.
Oceania (Revenue and Core Operating Profit) (P12)• As you can see at the top of the table, total revenue for the Alcohol
Beverages and Non-Alcohol Beverages businesses came in 0.4% lower than
the same period last year.
• In breaking down this result, the middle of the table shows net sales
excluding liquor tax. Total net sales in the Alcohol Beverages Businessdropped 3.1% year on year owing to the impact of Omicron and lower salesin Australia and New Zealand mainly because the Easter holidays fell in midApril this year, as opposed to March last year.
• Net sales in the Non-Alcohol Beverages Business were up 6.1% year on year
due to growth in sales of sugar-free cola and other drinks, as well as theimpact of the consolidation of Allpress that was acquired at the end of Junelast year.
• Core Operating Profit declined 11.5% year on year, reflecting lower sales in
the Alcohol Beverages Business and higher costs for raw materials and7

distribution, despite our efforts to improve overall cost efficiency.
• Compared to our target, even though there were some negative impacts inthe on-premise channel, Core Operating Profit overall is ahead of plan as aresult of better-than-expected sales growth in the off-premise channel andthe streamlining of fixed costs and advertisement and sales promotionexpenses.
• The table at the bottom of the page shows sales trends in the Australian
Alcohol Beverages Business. Even though sales of mainly Great Northernwere solid, sales volume in the off-premise channel declined by low single
digits year on year primarily as a result of the later Easter holidays.
• Sales in the on-premise channel contracted by mid-single digits from thesame period last year mainly because the spread of the Omicron variant put
a damper on on-premise demand in January.
• Up ahead, we anticipate further cost increases in Oceania too, but as
demand in the on-premise channel continues to recover, we will look tomeet our targets by ramping up marketing investments centering on ourcore brands and carrying out appropriate Revenue Growth Management.
Closing• As I mentioned at the start of my presentation, since announcing our fullyear results in February, raw material costs and utility prices have continued
to surge higher, so if the current market environment persists up ahead, wecan expect to incur additional cost increases this year and maybe even more
next year.
• At this juncture, forecasting how our earnings will be impacted is no easy
feat. Nevertheless, we intend to take stronger measures to ensure sales andprofit growth in all regions and continue to sustain an earnings recovery.
Your cooperation will be much appreciated.

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