This document is a summary translation of the Japanese language original version. In the event of any discrepancy, errors
and/or omissions, the Japanese language version shall prevail.

Summary of Consolidated Financial Statements (Japanese Standards)
for the Second Quarter of the Year Ending December 31st, 2016 (Q2 2016YTD)
August 12th, 2016
Listed Company Name:

Coca-Cola East Japan Co., Ltd.

Stock Exchange:

Security Code:

2580

URL:

http://www.ccej.co.jp

Name:

Calin Dragan

Name:

Johan Rolf

Representative:

title

Contact:

title

Representative Director,
President
Senior Executive Officer
Finance Function

Scheduled date of submission of quarterlyTEL:
03 (5575) 3859

Schedule date of start ofAugust 12, 2016

report:Tokyo Stock Exchange

September 9, 2016

dividend payment:

Preparation of supplementary documents for quarter results:

Yes

Quarterly earnings results presentation/conference:

Yes(Amounts of less than one million yen are rounded down)

1．
(1)

Consolidated Financial Results for the Second Quarter Ending June 30th, 2016 (January 1st, 2016 – June 30, 2016)
Consolidated Results of Operations (YTD)(Percentages show year-on-year changes)
Net Income
Belonging to parent
Net Sales
Operating Income
Ordinary Income
Company
Shareholders
Million Yen%

Million Yen%

Q2 2016 YTD
275,528
5.1
5,852
334.8
Q2 2015 YTD
262,0495.5
1,345－(Note) Comprehensive income: Q2 2016 YTD 1,496 Million Yen (-74.5%)%

Million Yen

Yen

Yen

25.42
7.98

25.38
7.97

.

(2)

Consolidated Financial Position
Total Assets

Net Assets

Million Yen

Equity Ratio

Million Yen%

Q2 2016 YTD
380,887
228,478
59.9
FY2015
371,771
230,94562.0(Note) Shareholders’ equity: Q2 2016 : 227,998 million yen
FY2015 : 230,525 million yen
2．Dividends
End of Q1Yen

FY2015FY2016FY2016 (Forecast)－－

Dividend Per Share
End of Q2
End of Q3
Yen

Yen

16.00
16.00

(Note) Revisions to the dividend forecast disclosed most recently

1

%

5,651
308.5
3,224 226.2
1,383
－
988
－
Q2 2015 YTD 5,868 Million Yen (－%)

Net Income per Share(Fully Diluted)

Net Income per Share
Q2 2016 YTD
Q2 2015 YTDMillion Yen

Year-end

Annual

Yen

yen

－

16.00

32.00

－

16.00

32.00

No

3．The Consolidated Earnings Forecasts for the Fiscal Year Commencing January 1st and Ending December 31st ,2016(Percentages show year-on-year changes)

Operating
IncomeNet Sales

Full-Year

Ordinary Income

Net Income
Belonging toparent Company
Shareholders

Million Yen%

Million Yen%

Million Yen%

Million Yen%

Yen

571,300

1.4

14,00029.7

13,600

30.6

7,200

34.5

57.42

(Note) Revisions to the Earnings forecasts disclosed most recentlyNo

Notes:(1)
Changes of important subsidiaries during consolidated Q2 2016 YTD (Changes of specificsubsidiaries accompanied by changes in the consolidation scope)(2)

Application of particular accounting treatments to the preparation of quarterly consolidated
financial statements(3)

Net Income
per Share

None

None

Changes in accounting policies and changes or restatement of accounting estimates(i) Changes in accounting policies accompanied by revisions of accounting standards, etc.

Yes(ii) Changes in accounting policies other than (i)None(iii) Changes in accounting estimatesYes(iv) Restatement

None

(4)
Number of Issued Shares (Common Shares)(i) Number of the issued shares at the end of
Q2 2016
the period (including treasury stock)(ii) Number of the treasury stock at the end of
Q2 2016
the period(iii) Average number of the shares during theQ2 2016
period (accumulated total)

127,680,144 shares

FY 2015

127,680,144 shares

837,216 shares

FY 2015855,654 shares

126,833,542 shares

Q2 2015 YTD

123,950,109 shares*Statement regarding the status of the quarterly review
This summary of financial statements for the second quarter of the year ending December 31st, 2016 falls outside thequarterly audit review required by the Financial Instruments and Exchange Act. The quarterly audit review of quarterly
consolidated financial statements required by the Financial Instruments and Exchange Act had not been completed as of thetime when this summary was disclosed.
*Explanation regarding the appropriate use of earnings forecasts and other special notes
Although the statements in this summary are prepared based on various information available to the Company and certain
assumptions considered reasonable by the Company, actual results may differ significantly due to various factors. For detailsof assumptions for earnings forecasts and notes on the use of earnings forecasts, please see “Qualitative information on the
consolidated earnings forecasts,” page 5 of the attached material of the summary.

2

Contents of the Attached Materials

1. Qualitative information on results for the second quarter of the year ending December 31, 2016 .....................2(1) Qualitative information on the consolidated operating results .........................................................................2(2) Qualitative information on the consolidated financial positions .......................................................................4(3) Qualitative information on the consolidated earnings forecast ........................................................................5
2. Matters relating to summary information (notes) ...................................................................................................5(1) Change of important subsidiaries during the consolidated Q2 2016 YTD ......................................................5(2) Application of particular accounting treatments to preparation of quarterly consolidated financial
statements ...............................................................................................................................................................5(3) Changes in accounting policies, accounting estimate or restatement ............................................................5(4) Additional information ........................................................................................................................................6
3. Consolidated financial statements..........................................................................................................................7(1) Consolidated Balance Sheets ...........................................................................................................................7(2) Consolidated Profit and Loss Statement and Comprehensive Profit and Loss Statement............................9(Consolidated Profit and Loss Statement) .........................................................................................................9(Consolidated Comprehensive Profit and Loss Statement) ........................................................................... 10(3) Consolidated Statement of Cash Flow ........................................................................................................... 11(4) Notes relating to quarterly consolidated financial statements ...................................................................... 13(Notes relating to assumptions for the going concern) ................................................................................... 13(Notes in the event of significant changes in amount of shareholders’ equity) ............................................. 13(Segment information and others) ................................................................................................................... 13(Business combination, etc.) ............................................................................................................................ 13- 21 -

1. Qualitative information on results for the second quarter of the year ending December 31, 2016
(1) Qualitative information on the consolidated operating results
Coca-Cola East Japan Co., Ltd. (CCEJ) today announced its consolidated financial results for the second
quarter and year-to-date 2016 (January 1, 2016 to June 30, 2016).
For additional details and management discussion of results, please also see the earnings presentationmaterial posted on our Company website, which will be used for the earnings presentation and webcast on
Monday, August 15, 2016 at 2:30 p.m. (JST). The webcast is available both live and on demand at
http://investor.ccej.co.jp.
Key Messages
・Year-to-date volume grew 9% year-on-year. Excluding the impact of Sendai Coca-Cola Bottling Co.,
(Sendai) integration from April 1, 2015, volume grew 6%. Market share momentum continued, withboth volume and value share growth.

・Year-to-date revenue grew 5% year-on-year, driven by continued good performance of newly
launched products, volume growth, and the benefit of the integration of Sendai

・Significant year-to-date operating income growth -- over four times prior year period--, mainly driven
by continuous synergy capture from supply chain efficiency and volume growth.

Operating Review
Total nonalcoholic ready-to-drink (NARTD) beverage industry volumes were generally positive in the year-todate period. Year-to-date total BAPC (Bottler Actual Physical Cases) sales volume of CCEJ grew 9% year-onyear, led by continued good performance of newly launched products as well as the integration of Sendai.
Volume excluding the integration impact (assuming previous year term volume includes Sendai) was positive
6% year-to-date.
Year-to-date volume grew across all channels, driven by growth across core beverage categories such as
sparkling, non-sugar tea, coffee and waters. Volume grew in all sales channels as follows: Drug & Discounterchannel +24%, Convenience Store channel +12%, Supermarket channel +8%, Eating & Drinking channel +6%
and Vending channel +3%.
Sparkling beverage volume grew +5% year-to-date, led by growth of trademark Coca-Cola, Coca-Cola Zeroand Fanta. In the hydration category, non-sugar tea volume grew +9% and water grew +23%, led by continued
good performance of our portfolio of water brands, including new product launches of the more premium,smaller package size I LOHAS water and growth of 2L Mori-no-Mizu Dayori brand. However, sports drinks
volume was negative 4%, reflecting overall category performance. Coffee volume continued to grow, up 15%,
mainly driven by Georgia The Premium series and customer-exclusive branded products. Juice volume grew
+7%.
Year-to-date channel and category performance were also driven by the Sendai integration.
Second quarter (April to June, Q2), total BAPC sales volume of CCEJ grew 3% year-on-year.
Volume performance by channel was led by strong growth in the Drug & Discounter channel (+20%) driven by
the growth of non-sugar tea, sparkling beverages and water. Supermarket channel and Convenience Storechannel volume both grew 3%, respectively. Eating & Drinking channel volume was slightly negative (-1%) andVending channel volume declined 2%, as growth in water and coffee was offset by decrease of sparkling
beverages and non-sugar tea, primarily due to cycling of prior year activities.

2

In terms of Q2 beverage category volume performance, sparkling beverage volume was even due to cycling of
newly launched products in the previous year, and we grew market share. In the hydration category, non-sugar
tea volume grew +3% led by Ayataka green tea, and water grew +18% led by continued good performance ofpremium I LOHAS water and strategic activation of 2L Mori-no-Mizu Dayori brand, which we pulled back on in
the prior year. Sports drinks volume was negative 9% as the overall category has been weak. Coffee volumecontinued to grow, up 9%, and juice was slightly negative (-1%)
We have a solid marketing and innovation calendar planned for the third quarter onward together with ourpartners at Coca-Cola Japan (CCJC).
We will continue the global advertising campaign for Coca-Cola, “Taste the Feeling”, throughout the year. In
order to capture peak season demand, “Coca-Cola Summer Campaign 2016 – That’s Gold!” launched on June
20 with marketing activities focusing on the 2016 Rio Olympic Games.
Also, we have been continuously working to improve profitability with a segmented approach to grow volume
and revenue across channels. In the Vending channel, we have continued to deploy vending initiatives such as
vending-exclusive product launches and loyalty programs for consumers using the smartphone application“Coke ON”. In addition, we continue to focus on stabilizing profitability of this important channel by moving or
removing unprofitable machines, prioritizing indoor machine placements and identifying cost-saving
opportunities.
Financial Review
Reported Results
Year-To-Date 2016 (January to June)
In Million JPY

2015

2016

% Change

Net Sales

262,049

275,528

+5.1%

1,345

5,852

+334.8%

988

3,224

+226.2%

2015

2016

% Change

Volume** (BAPC, in thousand)

139,801

151,858+8.6%

Net Sales

262,049

275,528

+5.1%

2,640

6,581

+149.3%

2015

2016

% Change

Volume** (BAPC, in thousand)

80,791

83,509+3.4%

Net Sales

151,828

151,006

-0.5%

4,239

6,975

+64.6%

Operating Income
Net Income
Comparable* Results
Year-To-Date 2016 (January to June)
In Million JPY, except volume

Operating Income
Second Quarter 2016 (April to June)
In Million JPY, except volume

Operating Income* Comparable: Presentation of results after excluding exceptional items such as charges, gains, etc. which are viewed bymanagement as non-recurring items impacting only the current period or the comparable period, but not both. These
comparability adjustments should be viewed in addition to, and not as an alternative for, the Company's reported results
prepared in accordance with JGAAP.
** Previous year volume shown above may be slightly different from what we shared in the previous year, as part of the3

implementation and standardization for the new ERP system, CokeOne+.

Our quarterly operating results during the year will likely exhibit seasonal variation, as the demand fornonalcoholic ready-to-drink beverages tends to be concentrated in the summer months.
Year-to-date reported revenue was JPY 275,528 million (positive 5% compared to the prior year period), mainly
attributable to volume growth as well as the integration of Sendai as of April 1, 2015. Q2 comparable revenue
declined slightly due to decrease in sales of finished products to other Coca-Cola bottlers in Japan.
Year-to-date reported operating income grew significantly to JPY 5,852 million (positive 335% compared to theprior year period), driven by gross profit increase reflecting continuous synergy captures from supply chain
efficiency, volume growth, etc. Additionally, growth of advertisement & sales promotion expenses, salescommissions, etc. due to volume growth partially offset by lower labor expenses, etc. resulted in a moderateincrease of sales, general & administrative expenses. Q2 comparable operating income grew 65%.
We reported year-to-date net income of JPY 3,224 million (positive 226% compared to the prior year period),
due to the increase in operating income, decrease of extraordinary loss, etc. partly offset by higher nonoperating expenses.

(2) Qualitative information on the consolidated financial positions(i) The financial positions at the end of this quarter
Assets at the end of this quarter were JPY 380,887 million, an increase of JPY 9,116 million from the end of theprevious fiscal year. This is mainly attributable due to an increase of account receivable-trade reflecting growth
in revenue. In addition, merchandise and finished goods and raw material and supplies increased as a result of
seasonal inventory build-up for peak sales season.
Liabilities at the end of this quarter were JPY 152,409 million, an increase of JPY 11,583 million from the end of
previous fiscal year. This is mainly due to an increase of short-term loans payable, increase of account payabletrade, etc., partially offset by decrease of other current liabilities and non-current liabilities due to the decreaseof lease obligations, etc.
Net assets at the end of this quarter were JPY 228,478 million, a decrease of JPY 2,467 million. This is
primarily due to a decrease in retained earnings by paying dividends and decrease of total accumulated othercomprehensive income, etc.
(ii) The cash flow positions
Cash and Cash Equivalents at the end of this quarter was JPY 19,406 million, a decrease of JPY 2,167 million
compared with the end of last fiscal year. Cash flow by activities in this consolidated accounting period is asfollows.
(Cash Flow from Operating Activities)
Cash used for operating activities was JPY 1,996 million (the cash generated JPY 984 million in the same
period of last year). This results mainly from JPY 5,174 million for net income before income taxes, depreciation
expenses, amortization of long-term prepaid expenses, increase of notes and accounts payable-trade, etc.
4

offset by increase in long-term prepaid expenses, inventories, notes and accounts payable-trade, etc.
(Cash Flow from Investing Activities)
Cash used for investing activities was JPY 13,947 million (cash out decreased JPY 4,786 million year-on-year).
The outflow includes expenditure for new fixed assets such as machinery and equipment for plants, cold drink
equipment, intangible fixed assets due to new development of phase two of ERP system, etc.
(Cash Flow from Financing Activities)
Cash generated from financing activities was JPY 13,777 million (decreasing JPY 10,426 million year-on-year).
The inflow is attributable to net increase of short-term loans. The outflow includes payment of the dividends,
repayment of lease obligations, etc.
(3) Qualitative information on the consolidated earnings forecast
No change from the forecast for the fiscal year ending December 2016, issued on February 12, 2016.
Additionally, on April 26, 2016, CCEJ and Coca-Cola West Co., Ltd. agreed to proceed with discussions/review
of a business integration and have entered into a non-binding Memorandum of Understanding between the twoparties. For details, please refer to “Announcement of Memorandum of Understanding Regarding Business
Integration between Coca-Cola East Japan Co., Ltd. and Coca-Cola West Co., Ltd.” on April 26, 2016. If further
disclosure concerning this matter shall be required and/or any impact to the forecast of this fiscal year expected,
we will disclose accordingly.

2. Matters relating to summary information (notes)(1) Change of important subsidiaries during the consolidated Q2 2016 YTD
There is no matter applicable(2) Application of particular accounting treatments to preparation of quarterly consolidated financial statements
There is no matter applicable.
(3) Changes in accounting policies, accounting estimate or restatement
Changes in accounting policies(Application of accounting standards regarding business combinations)
The Policy has been modified to apply the “Accounting Standard for Business Combination” (Accounting Standards
Board of Japan Statement No.21, Sept. 13, 2013. Hereinafter referred to as “Accounting Standard for Business
Combination”), the “Accounting Standard for Consolidated Financial Statements” (Accounting Standards Board ofJapan Statement No.22, Sept. 13, 2013. Hereinafter referred to as “Accounting Standard for Consolidated Financial
Statements”), and the “Revised Accounting Standard for Business Divestures” (Accounting Standards Board of Japan
Statement No.7, Sept. 13, 2013. Hereinafter referred to as “Revised Accounting Standard for Business Divestures”),
etc. from the first quarter of the consolidated accounting period concerned, and to post the difference due to thiscompany’s change in equity of a subsidiary, when control of the subsidiary continues, as capital surplus and as
expense in the consolidated accounting year in which acquisition-related expenses were incurred. Furthermore, withregard to the business combination executed at the beginning of the first quarter of the concerned consolidated
accounting period or thereafter, revisions to the allotment of the acquisition cost as a result of finalized accounting
processes shall be reflected in the Quarterly Consolidated Financial Statements of the quarterly consolidated
accounting period in which the business combination date is referred. In order to reflect these changes, the Quarterly
Consolidated Financial Statements and the Consolidated Financial Statements for the previous second quarter of the
cumulative consolidated period and the previous consolidated accounting year have been reclassified.
In the consolidated statement of cash flows for the 2nd quarter, the cash flows related to the acquisition or sale of5subsidiary shares that have not been affected by the changes in the scope of consolidation are entered under “Cashflows in financial activities” and the costs related to the acquisition of subsidiary shares affected by the changes in thescope of consolidation or the costs related to the acquisition or sale of subsidiary shares that have not been affectedby the changes in the scope of consolidation are entered under “Cash flows in sales activities”.
The application of the Accounting Standard for Business Combination etc. follows the transitional process defined in
the Accounting Standard for Business Combination Statement No.58-2(A), Accounting Standard for Consolidated
Financial Statements Statement No.44 -5 (4) and Revised Accounting Standard for Business Divestures Statement 574 (4) and is effective as of the start of the first quarter of the concerned consolidated accounting period and shallpersist into the future.
As a result of this change, in the first half of the current fiscal year, there is no impact on the quarterly consolidated
financial statements

Changes in accounting estimates(Change of useful lives of fixed assets)
The useful lives of machinery and equipment used for production purposes had been previously defined as 10 years.
Prompted by events such as the creation of a systematic maintenance policy for the CCEJ group’s machinery andequipment and the progress of internalization of maintenance activities, as well as the commencement of a new
production structure for the entire CCEJ group in response to the legal entity integration of Sendai Coca-Cola BottlingCo., Ltd. effective January, 2016, we revisited the physical durability and lifecycle of production machinery, etc. As aresult, we have prospectively changed the useful lives to a range of 7 to 20 years, which more accurately reflects the
economical useful lives effective the first quarter of the concerned consolidated accounting period.
As a result of this change, gross profit, operating income, ordinary income and quarterly income before income taxes
increased by JPY857million, respectively.

(4) Additional information(Modification of the amount of deferred tax assets and deferred tax liabilities due to changes of corporate tax
rate)
The “Law Revising a Portion of the Income Tax Law” (2016, Law No. 15) and “Law Revising a Portion of Local Tax”
(2016, Law No. 13) were promulgated on March 31, 2016, which amends corporate tax rate, etc. from theconsolidated fiscal year starting on April 1, 2016 onwards. Consequently, the effective statutory tax rates to be used forthe calculation of deferred tax assets and deferred tax liabilities shall be as follows, according to the periods for thesettlement of temporary differences:
33.0% up to December 31, 2016
30.8% from January 1, 2017 to December 31, 2018
30.6% from January 1, 2019 onwards
As a result of these tax rate changes, deferred tax assets (the amount after subtracting deferred tax liabilities)
decreased by 136 million yen, Income Taxes-Deferred increased by 106 million yen, while Valuation Difference on
Available-for-Sale Securities increased by 34 million yen, respectively. Remeasurements of defined benefit plansdecreased by 63 million yen.

6

3. Consolidated financial statements(1) Consolidated Balance Sheets(MM yen)
FY2015

Q2 2016 YTD

AssetsCurrent assets
Cash and deposits

21,57819,411

Notes and accounts receivable-trade44,56549,163

Short-term investment securities

301－

Merchandise and finished goods

34,35936,515Work in process－161

Raw materials and supplies

3,377

7,062

Others23,227

27,872

Allowance for doubtful accounts

(67)

(81)

127,343

140,104

Buildings and structures, net

45,86144,734

Machinery, equipment and vehicles,net

37,652

43,538

Sale equipment, net

66,112

66,360Land

50,88350,908Current assets
Noncurrent assets
Property, plant and equipment

Other, net
Property, plant and equipment
Intangible assets

9,808

2,682

210,318

208,224

8,361

8,744

25,97324,029

(225)

(215)

Investments and other assets
Other
Allowance for doubtful accounts
Investments and other assets

25,74823,813

244,428

240,782371,771

380,887

Accounts payable-trade29,14931,424

Short-term loans payable

5,160

29,000Current portion of long-term loans payable

1,234

1,040

Income taxes payable

1,100

2,135

Provision for bonuses

Noncurrent assets
AssetsLiabilities
Current liabilities

1,364

55

Provision for directors' bonuses

37

48

Provision for environmental measures－

0

Provision for early contract termination

963

1,017

Asset retirement obligations

33

30

Other

43,62435,063Current liabilities

82,66899,817

Bonds payable

30,00030,000Long-term loans payableNoncurrent liabilities
2,520

2,028

Provision for environmental measures

335

320

Provision for early contract termination

1,392

982

Net defined benefit liability

17,597

17,483

Asset retirement obligations

776

769

5,533

1,007

Other
Noncurrent liabilities
Liabilities

7

58,15652,592140,825

152,409

Consolidated Balance Sheets(MM yen)
FY2015

Q2 2016 YTD

Net assets
Shareholders' equity
Capital stock

6,499

6,499

Capital surplus

157,313

157,323

Retained earnings

68,454

67,620Treasury stock(1,178)(1,153)

Shareholders' equity

231,089

230,290

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

2,151

1,454

Deferred gains or losses on hedges(463)(1,071)(2,251)(2,674)

Total accumulated other comprehensive income(564)(2,291)

Subscription rights to shares

420

480

Net assets

230,945

228,478

Liabilities and net assets

371,771

380,887

Remeasurements of defined benefit plans8(2) Consolidated Profit and Loss Statement and Comprehensive Profit and Loss Statement(Consolidated Profit and Loss Statement)(MM yen)Q2 2015 YTD

Q2 2016 YTD

Net sales

262,049

275,528

Cost of sales

140,051

145,418

Gross profit

121,997

130,109

Selling, general and administrative expenses

120,651

124,256

1,345

5,852

Interest income

51

34

Dividends income

95

82

Operating income
Non-operating income

Share of profit of entities accounted for using equity method

70

86

Rent income

157

192

Gain on sales of valueable wastes

137

210

Other

136

149

649

756

Non-operating income
Non-operating expenses
Interest expenses

210

76

Loss on sales and retirement of noncurrent assets

265

773

Rent Expenses

18

37

Other

118

70

Non-operating expenses

611

958

1,383

5,651

Gain on sales of investment securities－

75

Gain on bargain purchase

84－

Gain on sales of noncurrent assets

31

Ordinary lncome
Extraordinary income

Others357

0Extraordinary income

445

77

Extraordinary loss
Loss on sales and retirement of noncurrent assets

699

46

Lease contract cancellation penalty

174

341

Impairment loss

8

4

Restructuring cost

319

112

Others495

48

Extraordinary loss

1,697

553

Income before income taxes

131

5,174

Income taxes-current

428

2,331

Income taxes-deferred(1,285)(381)

Income taxes

(856)

1,950

Net income

988

3,224

Net income belonging to parent company shareholders

988

3,224

9

(Consolidated Comprehensive Profit and Loss Statement)(MM yen)Q2 2015 YTD

Q2 2016 YTD

988

3,224

Valuation difference on available-for-sale securities

1,016

(696)

Remeasurements of defined benefit plans

4,187

(423)

(323)

(607)

Other comprehensive income

4,880(1,727)

Quarterly comprehensive income

5,868

1,496

5,868

1,496

Net income
Other comprehensive income

Share of other comprehensive income of associates accounted for using
equity method

Quarterly comprehensive income attributable to owners of the parent company

10

(3) Consolidated Statement of Cash Flow
(MM yen)Q2 2015YTD

Q2 2016YTD

Cash Flows from Operating Activities:
Income (loss) before income taxes

131

5,174

Depreciation and amortization

10,92910,970

Amortization of long-term prepaid expenses

6,630

6,059

39

3

Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in net defined benefit liability

(919)

(650)

Increase (decrease) in provision for directors' bonuses

(0)

11

Increase (decrease) in provision for directors' retirement benefits(2)-Interest income and dividends income

(147)

(116)

Interest expenses paid

210

76

(Profit) loss of entities accounted for using equity method

(70)

(86)

-

(75)

Special retirement expenses paid

250

109

Loss (gain) on sales of noncurrent assets

32

28

Loss on retirement of noncurrent assets

921

787

Loss (gain) on sales of investment securities

Impairment loss

8

4

(Increase) decrease in notes and accounts receivable-trade(9,224)(4,597)(Increase) decrease in inventories(14,237)(6,001)(Increase) decrease in long-term prepaid expenses(6,936)(6,274)

Increase (decrease) in notes and accounts payable-trade

12,1352,274

Changes in other assets and liabilities, net(4,007)(7,976)

Other

124

107

Subtotal(4,132)(171)

Interest and dividends income received

148

120

Interest expenses paid

(210)

(75)

Special retirement expenses paid

(107)

(381)

Income taxes paid

(2,646)(2,230)

Income taxes returned

7,932

741

984

(1,996)

Net cash derived from operating activities

11Consolidated Statement of Cash Flow
Cash Flows from Investing Activities:
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of Intangible assets
Proceeds from sales and redemption of investment securities(23,783)(13,284)

146

82(2,417)(1,515)0479

Purchase of investment securities
Proceeds from acquisition of investments in subsidiaries resulting
in change in scope of consolidation
Net increase (decrease) in short-term loans receivable

(76)

(20)

3,138

-

(68)

6

Payments of loans receivable

(130)

(136)

446

461

Collection of loans receivable
Governmental subsidy
Other
Net cash used in investing activities

4,033

-

(22)

(19)

(18,734)(13,947)

Cash Flows from Financing Activities:
Net increase (decrease) in short-term loans payable

28,80023,840

Repayment of long-term loans payable

(253)

(686)

Proceeds from sales of treasury stock00

Purchase of treasury stock

(8)

(1)

Repayments of lease obligations(2,396)(7,345)

Cash dividends paid

(1,938)(2,029)

Other

0

0

24,204

13,777Net Increase (Decrease) in Cash and Cash Equivalents

6,454(2,167)

Cash and Cash Equivalents at Beginning of Period
Increase (decrease) in cash and cash equivalents resulting fromchange of scope of consolidation
Cash and Cash Equivalents at End of Period

24,971

21,573509-

31,935

19,406

Net cash derived from financing activities12(4) Notes relating to quarterly consolidated financial statements(Notes relating to assumptions for the going concern)
None(Notes in the event of significant changes in amount of shareholders’ equity)
None(Segment information and others)(Segment information)
YTD Q2 2015 (January 1 to June 30, 2015)
1. Information regarding the amounts of sales, profit or loss by reportable segment
The Group has sole segment of beverage business, thus the description by each reporting segment is omitted.
2. Information regarding impairment loss, goodwill, etc. of fixed assets by reportable segment(Material change to the amount of goodwill）
Segment information is omitted as we have a single segment. Our consolidated subsidiary, FV East Japan Co., Ltd,
(formally named Mikuni Foods Co., Ltd.), has merged, as of April 1, 2015, FV Central Co., Ltd., Urban Vend-x Network
Co., Ltd., Wex Tokyo Co., Ltd., and EX-Service Co., Ltd., all of which were consolidated subsidiaries in the previous
consolidated accounting year; Fresh Vendor Service Co., Ltd. who was a non-consolidated subsidiary accounted forby the equity method; and TX Campus Co., Ltd. and Nitto Pacific Vending Co., Ltd. who were non-consolidated
subsidiaries. The increased amount of goodwill caused by this event is 633 MM yen.
(Material gain on negative goodwill）
Segment information is omitted as we have a single segment. A summary is provided in the quarterly consolidated
financial statements of “Note to Quarterly Consolidated Financial Statements(business combination, etc.).
YTD Q2 2016 (January 1 to June 30, 2016)
The Group has sole segment of beverage business, thus the description by each reporting segment is omitted.

(Business combination, etc.)
Q2 2015 (April 1 to June 30, 2015)
Business combination by acquisition
1. Overview of business combination(1) Name of acquired company and description of business
Name of acquired company: Sendai Coca-Cola Bottling Co., Ltd. (hereafter “Sendai CCBC”)
Description of business: Manufacture and sales of soft drinks(2) Main reason for business combination
Integrated the business with the acquired company through share exchange to streamline the regional business
operations in Kanto and eastern Japan and promote further improvements in customer service.
(3) Date of business combination
April 1, 2015(4) Legal form of business combination
Share exchange(5) Name of company after business combination
Company name is the same with before.
(6) Acquired ratio of voting rights
100%(7) Main grounds for deciding on the acquiring company
CCEJ has been decided to be the acquiring company after taking account of multiple factors comprehensively,
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including the relative large ratio of voting rights held by shareholders considered in the aggregate and thedifference in relative corporate sizes, in addition to the fact that CCEJ will be the sole parent company throughthe share exchange.
2. Period of the acquired company’s operating results included in the quarterly consolidated profit-and-loss statement
for the second consolidated cumulative quarter
April 1, 2015 to June 30, 2015
3. Breakdown of each cost for acquisition and type of consideration for the acquisition of the acquired company
Consideration for the acquisition (market value of common shares

14,175 million yen

issued on the effective date of business combination)
Direct costs required for acquisition (advisory fee, etc.)
Total acquisition costs

89 million yen
14,265 million yen

4. Share exchange ratio by type of share, the method of calculating the share exchange ratio, and the number of issued
shares(1) Common share exchange ratio
1 common share of Sendai CCBC: 2.563 common shares of CCEJ
(2) Method of calculating the share exchange ratio
CCEJ requested Nomura Securities Co., Ltd., an independent calculation agent, to calculate the share exchange
ratio, and, after negotiating and consulting sincerely with Sendai CCBC, calculated the share exchange ratio byusing the result of this agent’s calculation as a reference and taking the financial conditions and performancetrends of CCEJ and Sendai CCBC, and the market trend, among others, into consideration.
(3) Number of issued shares
5,781,166 shares
5. Amount of gain on negative goodwill and the reason for negative goodwill to arise(1) Amount of gain on negative goodwill that arose
84 million yen(2) Reason for negative goodwill to arise
Since the total assets and liabilities that CCEJ took over exceeded the acquisition price of the shares, theamount of difference has been written off as the gain on negative goodwill.
Q2 2016 (April1 to June 30, 2016)
Not applicable14