Coca-Cola Bottlers Japan
Kick-off Presentation
June 6, 2017

Tamio Yoshimatsu, President
Vikas Tiku, CFO
Head of Transformation

Forward-looking statements
The plans, performance forecasts, and strategies appearing in this material are based on the assumptions and judgment of themanagement of Coca-Cola Bottlers Japan Inc. (CCBJI) in view of data obtained as of the date this material was released. Theseforecasts may differ materially from actual performance due to risks and uncertain factors such as those listed below.
Risks and uncertain factors are not limited to the items listed below. They are also included in our annual securities report, or “YukaShoken Houkokusho”.

••
•
••
•
•

Agreements with The Coca-Cola Company and Coca-Cola (Japan) Company Limited.
The quality and safety of products
Market competition
Natural environment, such as climate, disaster, water resources, etc.
Legal environment
Leakage or loss of information
Change of economic conditions, such as personal consumption, currency exchange rates, prices of raw materials, fair value ofassets, etc.

• Business integration, streamlining and optimization of business processes, etc.
• Uncertain factors other than those above
The information in this presentation is provided for informational purposes and should not be construed as a solicitation of an investment
in our securities.
CCBJI undertakes no duty to update any statement in light of new information or future events. You should rely on your own
independent examination of us before investing in any securities issued by our company.

2

Agenda
CCBJI: A model bottler...now and for the future

Our vision – Growth roadmap for 2020 & beyond
Financial framework for creating shareholder value
Key takeaways

Q&A3

CCBJI: A Model Bottler…
Now and for the Future

5The bigger we are, the better we can serve you
OUR AMBITION
We will lead the beverage industry in Japan tomore profitable and sustainable growth

WHAT WE DO
We have the front line advantage andscale to drive growth with our customers

WHO WE ARE
We are the leading Japanese beverage company
and the largest Coca-Cola bottler in Asia
6

A defining moment in Japan’s bottling consolidation(CCW)
Kitakyushu
Sanyo
MikasaKinki
Minamikyushu
Shikoku+(CCEJ)
TokyoTone
Mikuni
Fuji
ChukyoSendai7

A strong heritage & winning capabilities
The right combination at the right time

The leader in the NARTD market in
Japan with national scale
A growth mindset to build a strong
Coca-Cola system with a shared vision
Built on the strong momentum at

CCW and CCEJ
A model bottler...now and for the future
8

CCBJI at a glance
The world’s third largest
Coca-Cola bottler by revenue

Number of Employees

About

25,000

Sales Area

Tokyo, Osaka, Kyoto
andTotal Beverage Company,
offering 50+ brands, 600+SKUs*Including temp staff

35 prefectures
Annual Revenue

About

1 trillion yen740,000*As of end of 2016Number of Consumers

50 million households
112 million consumers
Annual Sales Volume*Aggregation of CCW and CCEJ 2016 results

Sales Centers

Represents ~90% of totalsales volume for theCoca-Cola system in Japan

Number of Vending Machines

351 centers*As of January 2017, including distribution centers

Manufacturng Plants

17 plants

More than500*Actual 2016

million cases

Customer Outlets

320,000 outlets*As of end of 2016

Number of Fleets

16,300 vehicles*As of end of July 2016

9We are a Total Beverage Company
Operating in a growth market

TeaWaterVolume growth of the JapanNARTD market

OtherSparkling

Water
EnergySports
Tea

Juice
Coffee+1.2%

CoffeeSports

2014-2016
CAGRSparkling
19802016

CCBJI internal estimate

Beverages for Life10Led by a diverse and experienced leadership team
Leveraging the best from Japan and the Coca-Cola system
Tamio Yoshimatsu

Vikas Tiku

Yasunori Koga

President

Transformation & CFO

Corporate Administration

Costin Mandrea

Kyoichi Takagi

Bruce Herbert

Commercial

Corporate Planning

Supply Chain

Shigeki Okamoto

Haruko Ozeki

Shunichi Nasu

Corporate Communications

LegalIntegration Management Office

Jawahar Solai

Toyoji Okada

Maki KadoFinance

Human ResourcesProcurement

Asako Aoyama

Raymond Shelton

Yoshiaki Murata

Transformation Projects

Investor Relations

Key Account Management

11Supported by a solid corporate governance structure
Board of Directors
Company with Audit andSupervisory Committee
Blend of experienced board
members with a diversified
and global mindset

Tamio Yoshimatsu
Representative Director &President

Outside, Independent Director
Audit & Supervisory Committee Member
Former president & CEO of Ricoh Co., Ltd.

Vikas Tiku
Representative Director & Vice
President, Chief Financial Officer,
Head of Transformation

Tadanori Taguchi

Yasunori Koga

Irial Finan

Director & Senior Executive
Officer, Head of Administration

The Coca-Cola Companyowns 16.35%* as largest
shareholder

Zenji Miura

Costin Mandrea
Director & Senior Executive
Officer, Head of Commercial

Hiroshi Yoshioka

Director
Audit & Supervisory Committee Member

Outside Director
Audit & Supervisory Committee Member
President of Bottling Investment Group,
The Coca-Cola Company

John Murphy
Outside Director
Audit & Supervisory Committee Member
President of Asia Pacific Group,
The Coca-Cola Company

Outside, Independent Director*Including indirect ownership through subsidiaries

12We are part of the global Coca-Cola system
An enduring and effective partnership

Coca-Cola (Japan) Company•••••BrandsInnovation
Global perspective
Consumer focus
Superior insight••••••Customer focus
Local expertise
Best-in-class execution
Finished goods production
Logistics and distribution
Cost optimization
13

Video Message fromJames Quincey, CEO
The Coca-Cola Company

Our Vision –Growth Roadmap for 2020& BeyondOur vision – Growth roadmap for 2020 & beyond
Financialframework

Focus ongrowthNew
operatingmodel

Integration
synergies
People &communities

16Key metrics and picture of success
Revenue Growth

Stabilize topline, RGM initiatives,
revenue-rich innovation

Value Share

Value share growth ahead ofvolume share growth

Transactions

Growth in smaller, immediate
consumption packs

EBITDA Margin

Deliver strong cash flow fromoperations

Return on Equity(ROE)

Optimize balance sheet tomaximize returns
17Focus on GrowthCommitted to a growth agenda
Strategic Growth Pillars

Renewed Focus on
Revenue Growth

Re-imagine
Vending Business

Enrich Innovation
Pipeline

Customer Engagement
Best-in-Class Execution

In-depth Local Knowledge
19Renewed focus on revenue growth
Continue to prioritize profitable investments

Everything starts from the consumer – activate
based on consumption and shopping occasions
Continue to grow value where CCBJI has
competitive advantage
Expand premium innovation initiatives acrossthe channels
Showcase Tokyo to the world in 2020;
superior, segmented market execution20

Re-imagine vending – for growth and profit
The most convenient channel for consumers– fast, reliable, at an arm’s reach

Focus where the growth is – indoor and high traffic
locations
Leverage technology innovation to improve
operational efficiency
Rapid expansion & continued evolution of Coke ONBe a better partner for communities & environment
21

Enrich and sustain our innovation pipeline
Value-added innovation for our consumers andcustomers
Package, product, equipment, occasion,
operations – innovation is everywhere
Stronger bottler voice to drive innovation

Sharing, implementing and execution of
successful examples of other global Coca-Colabottlers
22New Operating ModelGuiding principles for a new operating model- Customer focus, externally-driven- Simple and speedy decision making- Lean corporate center withempowered regions- We all "sell or help sell”- Prioritizing "biggest bang”
synergy projects- Common enterprise system- Standardized processes andworld-class governance- Optimized number of entities- Functionally focused
operations from Day One- Coke One+ ERP system
rollout planned

Systemmindset- Speak as a single bottler voice- Put decision rights at the appropriatelevel- Roadmap for integrating
system support companies(Customer, Procurement, IT)- Strong bottler voice w/ CCJC

Lead theindustry- Leverage world-class capabilities- Centralize what benefits most fromleveraging scale- Create centers of excellence- Cooperating with other global
Coca-Cola bottlers- Moving forward with integrated
business services organization

Organize forgrowth
Operate asone enterprise24

CCJC: Coca-Cola (Japan) Company

Organized to serve our customers even better
OPERATING MODEL DESIGNCOMMERCIAL: 6 REGIONS

Consumers & Customers
Sell

SUPPLY CHAIN: 3 REGIONS

Integrated Business Services

6 commercialregions

3 supply chain
territories, managed
nationally

Frontline(field)SupportfunctionsCenterHQ

25

Committed to a new partnership model with TCCC
Joint transformation initiatives

Simplify decision-making
Align incentives to capture marketopportunities
Enhance mutual accountability

Stronger bottler voice to drive
innovation
TCCC: The Coca-Cola Company26

Integration Schedule
Synergy Target

Integrating with speed
Ready for 2020

• HR & IT system integration• Host Bottler of the 2020
Tokyo Olympic Games2018
Apr2017

Establish CCBJI

2020

Delivering results• Organizational integration
complete, including system
support companies• Establish optimized operating
structure/organization• Investment for further growth• Operating functionally• Balanced leadership team• World-class governance model28

Driving synergies across our business
Led by Supply Chain
Total synergies
by 2020Areas

High Impact Initiatives• Network optimization
Supply ChainandProcurement• Site and route optimization• Manufacturing productivity improvement• Increasing insourcing capacity• Price negotiation with suppliers

25B• Standardized pricing, terms, conditions (PTC)
Commercial• Optimizing route-to-market (RTM)• Vending cost-to-serve• Sharing of best practice

Back Office• Establish integrated business support function• Integrate legacy systems into CokeOne+
PTC: Price, terms and conditions RTM: Route-to-market

29Supply chain optimization will generate synergies
up to and beyond 2020
Capex Plan

Synergy Targets+5

Strategic Investment

Baseline Investment
201720182019

2020

Accumulated strategic Capex plan of 80B by
2019 for supply chain optimization and ERPSpecific investments for longer-term benefit
beyond 202025
By 2020

BB

By 2023

ERP: Enterprise Resource Planning30

Consolidate, eliminate & integrate legacy systems
across CCBJI
DataStandards• Enable data accuracy and consistency by combining in one
repository, improving transparency and insight
MARKET-TO-ORDER

StandardProcesses

RECORD-TOREPORT

Channel andCategory
Management

MASTER DATAMANAGEMENTCall Center

Field Sales andMerchandising
Management

MANAGEMENTREPORTING

MTO Management
Reporting

Financial Accounting
Key AccountManagement

Business planning

Data Standardization

Promotion
ManagementControlling

ORDER-TO-CASH

Full ServiceVending
Management
OTC Management
ReportingCustomer AssetManagement

Strategic Salesand Distribution
Route Planning

Pricing
Management

Integrated OrderManagement

Sales andDistribution

Settlement andBilling

Integrated Empties/ Returnables
Management

Monthly planning Rolling estimate

Integrated Weekly
Demand andSupply Planning

Production
Execution

Product Quality
Management

Warehouse
Management

Asset
Management

Treasury

FORECAST-TO-DEPLOY

Data Enablement

FTD Planning

Period end closing
FTD Management
Reporting

Haulage
Corporate & Management
Reporting

PROCURE-TO-PAY
Capital Budget

Vendormanagement

Procurement
management

Receiving
management

Accounts payable

Recruitment

Personnel
Administration

Training andEvents
Management

PTP Management
ReportingMaster Data Maintenance
Investment management• Provide a single application with standardised, shared, enhanced
and controlled processes

HUMAN RESOURCES MANAGEMENT
Organizational
Management

HRM Management
Reporting

Human Resource
Planning

Project Systems

Personnel Cost
Planning

Objectives Setting
and Performance
Management

Compensation
Management

Time Management

Payroll

One ERPSystem• Streamline applications portfolio and infrastructure• Standardises activity between functions & with business partners

Flexible
Organization• Enable organisational flexibility, integrated business services andnational supply chain

ERP: Enterprise Resource Planning

31

CCBJI2017 – 2020 Operating
Income Growth Plan

Deliver synergy commitments & reinvestment to drive growth
Operating income growth plan 2017 – 2020
Unit: B JPY

OI margin
6%

3(5)

65

Health & Skin
Care Business

Goodwill, etc.

2020
Target27
OI margin
4%40• Organic revenue
growth +1.5% CAGR
• Integration synergiesand re-investment

2016
Pro forma

Coca-Colabusiness33

Year-one synergies building on solid 2016 momentum
Pro forma 2017 operating income growth plan
Unit: B JPY

446(4)+15 vs PY

4240

2016
CCBJI
Pro forma

2017
CCW + CCEJ
Base Plans

Goodwill
amortization(9 months),etc.

Net
integration
synergies
and benefits

2017
CCBJI
Pro forma
before goodwill

42

2017
CCBJI
Pro forma34

2017 Business plan (Reported)
Consolidated CCEJ from Q2. Prior year CCW only
Consolidated

2017 Plan

2016 Actual

YoY

Revenue

906,500

460,455+96.9%

Operating Income

40,10021,143+89.7%

Ordinary Income

38,10020,602+84.9%

Net Income

21,5005,245+309.9%

122.85 JPY

48.05 JPY

+74.80 JPY

EPSCoca-ColaBusiness2017
Plan2016
ActualRevenue

872,400

Operating Income

36,500

Health & Skin
Care Business

2017
Plan

2016
ActualYoY

428,394 +103.6%

Revenue

34,10032,061+6.4%

18,369Operating Income

3,600

2,774+29.7%

YoY+98.7%

Unit: Million JPY except EPS
Net Income: Net income attributable to owners of parent
2016 actual results are former Coca-Cola West and YoY calculated on former Coca-Cola West results.

35

Strong operating income in Q1 2017
Driven by pricing discipline and cost optimization
Q1 2017 Pro forma: Volume -0.9% / Revenue per Case +3 JPY / OI +70% vs PY
By Channel
Others0%

Retail&Foods
23%Vending
31%

By Categoryvs PY

Supermarket
20%
Drug &Discounter11%
Convenience
Store15%

VolumeRevenueper Case

Supermarket-1%+43

Drug &Discounter+2%+51

Convenience
Store-2%+10Vending-4%

Retail & Foods+3%vs PY
Juice
4%

Others13%

Sparkling25%

Coffee22%+16-17

Teas
21%

Water Sports
9%6%VolumeSparkling+7%

Teas+1%

Sports-8%

Water-13%

Coffee-5%

Juice+1%

Year-to-date Business Update• Strong improvement in operating income, driven by price discipline, phasing of expenditures, etc.
• Seeing revenue per case improvements with improved profitability• Expect continued volume pressure as we “stay the course” on pricing

36

Financial Framework

A clear framework for value creation① Grow earnings to generate free cash flow

② Invest to grow & deliver synergy commitments③ Leverage debt capacity to build efficient capital structure④ Drive shareholders’ return with focus on ROE

38

Grow earnings to generate steady cash flow
Strategic Approach2020 Vision
20162020

Beyond 2020Revenue-1.8%

2%+EBITDA
margin8%

11%

12-13%

OI
margin4%

6%

8%

Key Metrics
Deliver revenue growth throughmarket leadership andcomprehensive top-line management
Building strong and efficient
foundation to maximize company
profitability and cash flow generation

Steady free cash flow generation

39

Investing to grow & deliver synergy commitments
Capex Investment Principles
Baseline
Investment

Focus on investments withattractive returns to drive
growth & efficiency
Cash Flow Plan

~4% of revenue

2017~2020
Cumulative

Cash flow from operations

358

CAPEX

272

Free cash flow86Unit: Billion JPY

Strategic
investment

Ensure strong
foundation to keep
the business running~2% of revenue

Synergy investment todrive efficiency including
SCM areas

Other growth
opportunity

Capacity to fund additional
opportunities as they arise
40Build efficient capital structure and improve ROE
Optimize capital
structure tomaximize
shareholder
returns

1
23

Utilize debt capacity to operate up to 2.5X EBITDA

Focus on maintaining investment grade rating
Optimize WACC by periodically evaluating capital
structure

Target ROE

Today

2020

4%

6%

Beyond2020

8+%41Maintaining shareholder returns in 2017
Dividend forecast and shareholder benefits program

Annual Dividend

44

Prioritized stable dividend2017 CCBJI dividend forecast slightly increased from 2016 dividend pershare for former CCW/CCEJ shareholders*
Estimated dividend payout: 42%

JPY/ShareInterim

Year-end

Shareholder benefits program that encourages long-term holding

22

22

JPY/ShareJPY/ShareShareholders can exchange the shareholder benefit points for Coca-Colaproducts, CCBJI goods, donate them to charity, etc.

*Excluding CCW special commemorative dividend, average of CCW and CCEJ based on adjusted
share count after the share exchange42A holistic approach for value creation
Renewing topline growth, improving profit margins

Committed to investments, best-in-class execution and capabilities
Revenue Growth Management
Vending transformation
Innovation

Targeting 25B Yen in synergies by 2020, another 5B by 2023
Capital structure, dividend payout ratio to be reviewed periodically tomaximize total shareholder return while maintaining flexibility topursue expansion opportunities
43

People & Communities

Always connected to our employees and localcommunities
Inspiring ourpeople

Community
connections

Sustainability inall that we do45

Key Takeaways

Key metrics and picture of success
Revenue Growth

Stabilize topline, RGM
initiatives, revenuerich innovation

Value Share

Value share growthahead of volume
share growth

Transactions

Growth in smaller,
immediate
consumption packs

IC package growth

EBITDA Margin

Deliver strong cash
flow from operations>10% EBITDA margin

Return on Equity(ROE)

Optimize balance
sheet to maximize
returns>6%

Revenue +1.8% CAGR

Value ahead of volume
47

CCBJI: Growth roadmap for 2020 & beyond
Key takeaways

The heart of the decision to form CCBJI:
Bringing together a proven leadership team committed togrowth, partnering with our customers and communities, anddriving shareholder value
A compelling business combination at the right time with clear
opportunities and plans for profitable growth

Working with appropriate speed to make sure we realize our potential
We are making good early progress as we kick off toward 2020 andbeyond
48

Q&A

Appendix

Key Glossaries
DME

Abbreviation of Direct Marketing Expenses. Sales promotion-related expenses, including advertisement, rebates, sales, salescommissions, etc.

FC

Abbreviation of Future Consumption. Purchase or sell beverage for future consumption in home, etc. It also means the products/ SKUs for FC (for example, single packages 1L or more and multi-pack of IC packages) and channels that consumers
purchase the beverages for FC. (for example, supermarket, drug & discounter channels, etc.).

IC

Abbreviation of Immediate Consumption. Purchase or sell beverage for consuming it immediately. It also means the products /SKUs for IC (for example, single packages less than 1L as well as fountain) and channels that consumers purchase thebeverages for IC (for example, vending machines, convenience store channel, etc.).

OBPPC

Abbreviation of Occasion, Brand, Package, Price, Channel. A segmentation strategy tailored to consumption opportunities todrive revenue growth in five areas: occasion, brand, package, price and channel.

Pro forma

Assuming integration from January 2017 and estimate 2016 results same standard

PTC

Abbreviation of Price, Terms and Conditions, an internal guideline for setting appropriate transaction conditions with customers,frequently used in conjunction with RGM.

RGM

Abbreviation of Revenue Growth Management, an overall strategy and process to grow revenue and profit

RTM

Abbreviation of Route-to-Market. A framework, a process, a philosophy, a proven approach for driving profitable growth.

Channel Definitions

Vending

Retail sales to consumers through vending machineSupermarket

Wholesale to supermarket chains customers

Drugstore & Discounter

Wholesale to drugstore and discounter chains customers

Convenience Store

Wholesale to convenience store chains customers

Retail & Food

Wholesale to grocery store, liquor store, eating & drinking establishments,
online sales channels customers, etc.

OthersWholesale to customers other than above

51

Investor Relations
ir@ccbji.co.jp+81-3-5575-3797
https://en.ccbji.co.jp/ir/
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