Financial Results
for the three Months Ended March 31, 2017 — Consolidated(Based on Japanese GAAP)May 11, 2017

Company name

Sapporo Holdings Limited

Security code
Listings
URL

2501
Tokyo Stock Exchange (First Section); Sapporo Securities Exchange
http://www.sapporoholdings.jp/english/

Representative
Contact

Masaki Oga, President and Representative Director
Toshihiko Umezato, Director of the Corporate Communications Department

Telephone
Scheduled dates:+81-3-5423-7407

Filing of quarterly financial report

May 12, 2017

Commencement of dividend payments-

Supplementary information to the quarterly earnings results

Available

Quarterly earnings results briefing heldYes(mainly targeted at institutional
investors and analysts)

1. Consolidated Financial Results for the Three Months Ended March 31, 2017
(Amounts in million yen rounded down to the nearest million yen)(January 1 – March 31, 2017)<Note>On July 1, 2016, the Company carried out a share consolidation at a ratio of 1 share for 5 shares of theCompany’s common stock. Accordingly, values for the items noted below have been recalculated on theassumption that the share consolidation took place at the beginning of the previous fiscal year.
・Profit per share・Diluted profit per share
・Average number of outstanding shares during the period(1) Operating Results(Percentage figures represent year-over-year changes)
Profit attributable to
Net sales

Operating income

Ordinary income
owners of parent

Three months ended
March 31, 2017
Three months ended
March 31, 2016

million yen%

million yen%

117,788

5.7(1,453)-(1,946)-(2,307)-111,391

2.7(1,427)-(2,272)-(2,006)-

Note: Accumulated other comprehensive income
Three months ended March 31, 2017 (3,871) million yen
Three months ended March 31, 2016

(6,428) million yen

1million yen%

million yen%

Profit per share

Diluted profit per
share

Yen

Yen

(29.62)-(25.76)-

Three months ended
March 31, 2017
Three months ended
March 31, 2016

(2) Financial Position
Total assets

Net assets

Shareholders’equity ratio

million yen

million yen%

March 31, 2017

590,797

159,618

26.1

December 31, 2016

626,351

166,38025.7

Note: Shareholders’ equity
March 31, 2017: 154,074 million yen
December 31, 2016: 160,687 million yen

2. Dividends
Dividend per share
Record date or
periodEnd Q1End Q2End Q3Year-end

Full year

Yen

yen

yen

Yen

yen

Year ended
December 31, 2016—

Year ending
December 31, 2017—

Year ending
December 31, 2017
(forecast)

0.00

—

37.00

37.00

0.00

—

37.00

37.00

Note:No changes were made to dividend forecasts in the three months ended March 31, 2017.

3. Forecast of Consolidated Earnings for the Year Ending December 31, 2017
(January 1 – December 31, 2017)(Percentage figures represent year-over-year changes)
Net salesYear ending
December 31,
2017

Operating income

Profit attributable toProfitowners of parent

per share

Ordinary income

million yen%

million yen%

million yen%

million yen

563,800

4.1

21,3005.1

20,3005.7

10,700Note: Changes were made to earnings forecasts in the three months ended March 31, 2017: None

2

%

Yen

13.0

137.36

4. Other*For details, see "3. Notes on the quarterly financial statements" on page 13.
(1) Changes in significant subsidiaries during the three months ended March 31, 2017: None
(2) Simplified accounting: Yes*Use of simplified accounting methods and/or accounting methods specific to quarterly consolidated
financial statements(3) Changes in accounting policy, changes in accounting estimates, and retrospective
restatement
1) Changes in accordance with amendments to accounting standards etc.: None
2) Changes other than 1) above: None
3) Changes in accounting estimates: None
4) Retrospective restatement: None
(4) Number of shares issued and outstanding (common stock)1) Number of shares issued at end of period (treasury stock included):
March 31, 2017:
78,794,298 shares
December 31, 2016: 78,794,298 shares
2) Number of shares held in treasury at end of period:
899,692 shares
March 31, 2017:
December 31, 2016: 898,911 shares
3) Average number of outstanding shares during the period:
Three months ended March 31, 2017: 77,894,901 shares
Three months ended March 31, 2016: 77,903,363 shares*Quarterly review status
The quarterly financial results are not subject to quarterly reviews pursuant to the Financial
Instruments and Exchange Act. The quarterly review of the quarterly financial results herein
had not been completed as of the date of this document.
Appropriate Use of Earnings Forecasts and Other Important Information
This document contains projections and other forward-looking statements based on information
available to the Company as of the date of this document. Actual results may differ from thoseexpressed or implied by forward-looking statements due to various factors.

3

1. Analysis of Operating Results(1) Consolidated Financial Results for the Three Months ended March 31, 2017
In the first quarter of 2017 (January 1 – March 31, 2017), the Japanese economy remained in a moderate
recovery trend, but consumer spending continued to lack strength. Meanwhile, mounting geopolitical risk has
added to the uncertainties clouding the future outlook.
In this economic environment, the SAPPORO Group achieved growth in consolidated sales.
The Japanese Alcoholic Beverages business increased shipments of its beer and diversified alcoholic
beverage products. The International Business achieved volume growth in its sales of alcoholic beverages
and soft drinks in North America, while the Food & Soft Drinks business saw increases in sales volumes for
its food and soft drink products.
Despite year-on-year growth in sales volumes in all business segments, the Sapporo Group posted a firstquarter operating loss owing to rising logistics expenses and an increase in fixed costs as we aggressively
invested to further enhance brand strength. The operating loss was, however, similar to that posted in thefirst quarter of the previous year.
As a result of the above factors, in the first quarter of 2017 the SAPPORO Group posted consolidated
sales of ¥117.7 billion (up ¥6.3 billion or 6% year on year), an operating loss of ¥1.4 billion (compared with a¥1.4 billion loss a year earlier), an ordinary loss of ¥1.9 billion (compared with a ¥2.2 billion loss a year
earlier), and a net loss attributable to owners of parent of ¥2.3 billion (compared with a loss of ¥2.0 billion ayear earlier).
Seasonal Factors
The Group’s operating results exhibit substantial seasonal variation because demand for the products andservices offered by the Japanese Alcoholic Beverages, International Business, Food & Soft Drinks, andRestaurant businesses tends to be concentrated in the summer months. Sales and profits consequently tend
to be lower in the first quarter than in the other three quarters.
Segment information is outlined below.

Japanese Alcoholic Beverages
We estimate that total domestic demand for beer and beer-type beverages in the first quarter of 2017 wasslightly lower than in the first quarter of 2016.
Amid such market conditions, the Japanese Alcoholic Beverage business continued its efforts to realize
management’s vision of “Seek to be No.1 by accumulating one-of-a-kind products” and achieve further
growth by constantly providing customers with a unique value proposal and by investing aggressively in thebeer business during 2017, in line with the business policy of “Beer Revival Declaration."
Among beer products, Sapporo Draft Beer Black Label continued to enjoy strong demand, with sales of4the canned version particularly strong. Sales of the Yebisu brand also expanded, supported by customers’favorable response to the March launch of Yebisu Hana Miyabi. As a result, total domestic shipments ofbeers in the first quarter of 2017 increased 5% year on year. In the happoshu category, Goku Zero sales
declined year on year, but sales in the new-genre category were solid, with Mugi to Hop sales even with theprevious year’s level. Overall, first-quarter shipments of our beer and beer-type beverages products wereabout the same as a year earlier.
In the RTD*1 category, Ai no Skal White Sour, the latest addition to our high-value-added collaboration
products, was sold only in western Japan and favorably received by customers. Sales of other core RTD
products, including Otoko Ume Sour and Kireto Lemon Sour, also were solid, and the category achieved
year-on-year sales growth.
We also achieved year-on-year sales growth in the wine category, as we strengthened marketing of finewines*2, including an imported wine Penfolds, Taittinger champagne, and our domestic wine Grande Polaire.
Our spirits business achieved year-on-year sales growth, on strong sales of products from major overseas
brands, such as Bacardi and Dewars.
Our Japanese liquor business also performed well in the first quarter of 2017, with continued strong salesof Imo Shochu Kokuimo, Japan’s No. 1 selling*3 blended imo shochu, helping drive up sales over theprevious year’s level.
Overall, the Japanese Alcoholic Beverages business posted first-quarter sales of ¥54.4 billion, up ¥1.3
billion or 3% year on year. The first-quarter operating loss came to ¥1.9 billion, compared with the ¥1.8 billion
loss recorded a year earlier.
*1) RTD, or ready-to-drink, beverages are already-mixed, low-alcohol content cocktail-like beverages that can be consumed as
is immediately after opening.
*2) Fine wines are wines priced in the mid- to high-price range (¥1,500 and higher per bottle).
*3) Based on Intage SRI market research on combined blended imo shochu sales in the supermarket, convenience store, anddirect sales channels from January 2015 to December 2016.

International BusinessWe estimate that total demand in the North American beer market in the first quarter of 2017 was below
previous-year levels in both the United States and Canada. Meanwhile, Asian markets was solid but growth
momentum slowed in line with the widely divergent pace of growth in national and regional economies.
In this environment, our International Business continued its efforts to strengthen brand recognition in thepremium beer markets in North America and Southeast Asia. In addition, we expanded our sales channel in
the US fruit juice market.
Our Canadian subsidiary SLEEMAN BREWERIES continued to invest in the marketing of its core premium
brands. As a result, its overall beer sales volume (excluding Sapporo brand beer) increased about 3% year on
year in the first quarter of 2017. In the U.S. beer market, Sapporo USA’s efforts to expand its customer market

5among the general population as well as Asian Americans led to a 10% year-on-year increase in shipments of
Sapporo brand beers in the first three months of 2017. Our U.S. soft drinks business also achieved year-onyear sales growth, supported by solid sales of commercial-use soft drinks and fruit juice sorbet at Country Pure
Foods and Silver Springs Citrus.
In Southeast Asia, our Vietnam business saw its first-quarter beer shipments decline year on year owing toan increase in the country’s liquor tax in January and a negative calendar effect from a shorter traditional lunar
new year holiday. Our Singapore business, meanwhile, continued its efforts to expand its sales channels in thehousehold- and commercial-use markets.
Elsewhere in Asia, the Korean business’ efforts to expand the number of sales outlets carrying our Sapporo
Premium Beer led to an increase in beer shipments to both the household- and commercial-use markets. In
Oceania, continued efforts to strengthen sales via licensing agreements with local brewing partners produced
another year-on-year gain in beer sales volumes.
The efforts and results outlined above produced a strong 11% year-on-year increase in Sapporo brand beer
shipments by the International Business during the first quarter of 2017.
As a result, the International Business posted first-quarter sales of ¥16.6 billion, up ¥1.2 billion, or 8%. The
segment’s first-quarter operating loss came to ¥0.2 billion, compared with last year’s ¥0.3 billion loss.

Food & Soft Drinks
We estimate that overall demand for soft drinks in Japan increased 1% year on year during the first quarter of2017.
In this environment, our domestic soft drinks business continues to strengthen our shokkan-kei (texture),sozai-kei (ingredient) and Gabunomi series of brands and deliver value propositions unique to the Sapporo
Group.
The business enhanced its lineup of lemon-based drinks during the first quarter of 2017 by launching two
new products that meet customers’ diversifying preferences and further differentiate the Sapporo brand fromcompetitors. Pakuchi & Lemonade, a refreshing combination of the coriander herb and lemonade, was added
to our World Lemonade series, which combines intriguing ingredients from around the world. Lemon no
Shizuku is a new lemon-flavored drink with a strong emphasis on delivering a distinctly lemony taste. We also
supplemented our lineup of sugar-free tea drinks made from scarce domestic materials with the limited-timeoffering of Chiran Nippon Kōcha Mutō Kyō Zakura no Kaori, made from tea leaves from Chiran in Kagoshima
Prefecture and cherry blossom extract that delights the senses with the seasonal scent of Kyoto cherry
blossoms.
The first quarter of 2017 also saw the domestic food business launch Risorante, a new cup-based risottobrand made from original rice ingredients with a rich, springy texture that excites the palate. Lemon-based foodproduct sales increased 6% year on year in the first quarter, on strong sales of our core Pokka Lemon 100
brand products. We also enhanced our lineup of soymilk and soymilk-based yogurt products with the launch

6

of Plus Nyusankin Tonyu Inryo, a soymilk drink based on the Sapporo Group’s proprietary plant-based lactic
acid bacterium SBL88.
At the domestic restaurants business, Pokka Create, the POKKA SAPPORO subsidiary that operates the
Café de Crié coffee shop chain, is aggressively opening stores inside bookstores and hospitals while also
strengthening branding for its new-format Maison de VERRE coffee shops. These efforts contributed to sales
expansion at our directly-run shops and a year-on-year increase in sales at the Food & Soft Drinks segment’s
domestic restaurants business.
The overseas soft drinks business maintained its top share* in Singapore's tea drinks market, including its
dominant 70% share of the green tea market, while also expanding exports, including to other Southeast Asian
countries. Meanwhile, our joint venture in Indonesia, PT. POKKA DIMA INTERNATIONAL, made progress
preparing for the startup of commercial production at its local plant.
Overall, the Food & Soft Drinks segment recorded sales of ¥31.5 billion in the first quarter, up ¥1.3 billion or
4% year on year. The segment posted an operating loss of ¥0.6 billion, same as the loss recorded in the firstquarter of the previous year.
* Based on data from Nielsen Singapore MarketTrack March 2016 (Copyright 2016, The Nielsen Company)

Restaurants
Japan’s restaurant industry stayed on the recovery track in the first quarter of 2017, while grappling with asevere operating environment characterized by labor shortages and the resulting increase in labor costs aswell as the upward trend in food material procurement prices.
In this environment, the Restaurants business continued to pursue the fulfillment of its philosophy of“Enhancing the Joy of Living” through constant efforts to deliver safe and sound food and service to customers
while also striving to create restaurants that “deliver 100% satisfaction to customers.”
New store openings in Japan included the February opening of a Yebisu Bar outlet in Hiroshima, the chain's
first outlet in the Chugoku–Shikoku region, and the March opening of another outlet in Shin Yokohama. Also
during the quarter, we renovated the Beer Hall LION GINZA 7-Chome outlet, one of that chain’s flagship stores.
Meanwhile, we closed three unprofitable outlets. As a result, we had 199 outlets operated by our Restaurants
business in Japan as of end-March 2017.
Overseas, we continued to expand our operations in Singapore, where we are building a chain of restaurants
popular with local consumers. We fully renovated our Tonkichi Orchard Central outlet located in the center ofthe city-state and changed its format by rebranding it as Tonkichi Hokkaido. We also renovated three other
outlets in Singapore. Meanwhile, we closed one of our RIVE GAUCHE cake shops, reducing the total numberof Sapporo Group restaurant outlets operating in Singapore as of end-March 2017 to 13.
Overall, Restaurants business sales in the first quarter of 2017 totaled ¥6.4 billion, up ¥0.6 billion or 11%
year on year. The first-quarter operating loss was ¥0.2 billion, compared with a ¥0.1 billion loss in the firstquarter of 2016.

7

Real Estate
Japan’s real estate industry continued to enjoy solid demand in the Greater Tokyo office leasing market,

keeping vacancy rates low and supporting a continued moderate recovery in rent levels.
In this environment, our real estate leasing business was able to maintain high occupancy rates at its
properties in Tokyo Metropolitan area, including Yebisu Garden Place Tower, the business’ core source of
earnings. In addition, the high occupancy rates provided a solid platform for more assertive efforts to increase
rents of existing tenants.
We are constantly striving to bring new added-value to our core Yebisu Garden Place commercial complex
and enhance the property’s brand value. Thus far in 2017, those efforts have included the establishment of aconsortium-type childcare center that can be used by employees of the many companies with offices in thecomplex as well as Shibuya Ward residents. The new facility opened its doors in April. We also continued withthe renovation and renewal work on the Yebisu Garden Place Tower’s 39th floor restaurant row, which offers
diners fantastic panoramic views of the area.
GINZA PLACE, a new commercial complex we opened in September 2016, is expected to make a solid
contribution to earnings in its first full-year of operation. We will continue to strengthen the facility’s information
dissemination capability in line with its original concept as a “base for information dissemination and exchange.”
In addition to enhancing the property’s brand value, these efforts are increasing the property’s drawing powerand helping make the Ginza district an even more dynamic and bustling urban center. Meanwhile, our realestate development business is making steady progress on the redevelopment of our former Sapporo Factoryas part of the renovation of the area on the east side of the Sosei River, a focus of Sapporo City’s urban
redevelopment program. In addition to renovating a commercial complex Sapporo Factory, we areredeveloping the parking lot adjacent to the factory site into a commercial building.
As a result of the efforts outlined above, Real Estate business sales in the first quarter of 2017 totaled ¥5.9
billion, up ¥0.5 billion or 10% year on year. Operating income was ¥2.9 billion, up ¥0.3 billion or 12%.

(2) Consolidated Financial Condition
Consolidated assets as of March 31, 2017, totaled ¥590.7 billion, ¥35.5 billion less than at the end of theprevious fiscal year (December 31, 2016). The decline is mainly attributable to decreases in trade notes andaccounts receivable and in long-term loans receivable, which more than offset an increase in merchandise andfinished products.
Total liabilities totaled ¥431.1 billion, a ¥28.7 billion decrease from December 31, 2016, primarily owing
to decreases in trade notes and account payable, liquor taxes payable and long-term bonds, which
outweighed increases in commercial paper and accrued bonuses.
Consolidated net assets totaled ¥159.6 billion, down ¥6.7 billion from the end of the previous fiscal year. The
decrease primarily reflects lower foreign currency translation adjustments and the payment of year-end

8dividends.

(3) Consolidated Earnings Forecast
The consolidated earnings forecast for the full fiscal year ending December 31, 2017, is unchanged from theforecast announced by Sapporo Holdings on February 13, 2017.

9

2. Consolidated Financial Statements(1) Consolidated Balance Sheets(millions of yen)

AssetsI Current assets
1 Cash and cash equivalents
2 Notes and accounts receivable - trade
3 Merchandise and finished products
4 Raw materials and supplies
5 Other
6 Allowance for doubtful receivables
Total current assets
II Fixed assets
1 Property, plant and equipment(1) Buildings and structures
Accumulated depreciation
Buildings and structures, net(2) Machinery and vehicles
Accumulated depreciation
Machinery and vehicles, net(3) Land(4) Construction in progress(5) Other
Accumulated depreciation
Other, net
Total property, plant and equipment
2 Intangible assets(1) Goodwill(2) Other
Total intangible assets
3 Investments and other assets(1) Investment securities(2) Long-term loans receivable(3) Other(4) Allowance for doubtful receivables
Total investments and other assets
Total fixed assets
Total assets

10

December 31, 2016

March 31, 2017

AmountAmount10,58996,85024,657
13,31518,852(82)
164,183

9,428
68,48927,572
13,155
19,574(62)
138,159

393,022(220,233)
172,788
231,559(187,660)
43,898111,636
3,694
34,702(21,224)
13,477345,495

393,096(221,653)
171,442
231,090(188,214)
42,875
111,420
3,560
34,268(21,148)
13,119342,418

27,43910,511
37,95026,285
10,292
36,57759,29659,092

4,789

459

15,831(1,195)78,721
462,168
626,351

15,305(1,215)73,641
452,638
590,797

Liabilities
I Current liabilities
1 Notes and accounts payable - trade
2 Short-term bank loans
3 Commercial Paper
4 Current portion of bonds
5 Liquor taxes payable
6 Income taxes payable
7 Accrued bonuses
8 Deposits received
9 Other
Total current liabilities
II Long-term liabilities
1 Bonds
2 Long-term bank loans
3 Net defined benefit liability
4 Dealers' deposits for guarantees
5 Other
Total long-term liabilities
Total liabilities
Net Assets
I Shareholders' equity
1 Common stock
2 Capital surplus
3 Retained earnings
4 Treasury stock, at cost
Total shareholders' equity
II Accumulated other comprehensive income
1 Unrealized holding gain on securities
2 Deferred hedge gains
3 Foreign currency translation adjustments
4 Remeasurements of defined benefit plans
Total accumulated other comprehensive income
III Non-controlling Interests
Total net assets
Total liabilities and net assets

11

December 31, 2016

March 31, 2017

AmountAmount38,50330,33733,00010,08334,228
1,680
2,980
8,214
53,095
212,12335,802
27,99041,00010,071
18,157
1,090
4,825
8,872
49,978
197,789

50,128
114,593
8,995
33,24140,887
247,847
459,971

40,128114,157
8,655
30,90639,541
233,389
431,178

53,88646,08941,932(1,795)140,11253,88646,08936,737(1,797)
134,915

22,51741(1,943)(41)
20,574
5,693
166,380
626,351

22,12330(2,867)(128)
19,1595,544
159,618
590,797

(2) Consolidated Statements of Income

I Net sales
II Cost of sales
Gross profit
III Selling, general and administrative expenses
1 Sales incentives and commissions
2 Advertising and promotion expenses
3 Salaries
4 Provision for bonuses
5 Retirement benefit expenses
6 Other
Total selling, general and administrative expenses
Operating loss
IV Non-operating income
1 Interest income
2 Dividend income
3 Equity in income of affiliates
4 Other
Total non-operating income
V Non-operating expenses
1 Interest expense
2 Foreign exchange losses
3 Loss on valuation of derivatives
4 Other
Total non-operating expenses
Ordinary loss
VI Extraordinary gains
1 Gain on sales of property, plant and equipment
2 Gain on sales of investment securities
Total extraordinary gains
VII Extraordinary losses
1 Loss on disposal of property, plant and equipment
2 Loss on sales of property, plant and equipment
3 Loss on impairment of property, plant and equipment
4 Compensation expenses
Total extraordinary losses
Loss before income taxes
Income taxes
Loss
Profit (loss) attributable to non-controlling interests
Loss attributable to owners of parent
Loss
Other comprehensive income
Unrealized holding gain on securities
Deferred hedge gains (losses)
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

12

Three months ended
March 31, 2016
Amount111,391
73,94437,446(millions of yen)Three months ended
March 31, 2017
Amount117,788
77,261
40,526

8,074
4,742
6,956
1,431
206
17,461
38,874(1,427)

8,785
5,403
7,276
1,514
182
18,817
41,979(1,453)

67
117
5
294
484

53
133
4
225
416

532
323
271
200
1,329
(2,272)

493
182
0
233
910
(1,946)

5
5
10

5

161
2
29
224
418
(2,681)(586)(2,095)(88)(2,006)

163
3
85
174
426
(2,367)(87)(2,280)26(2,307)(2,095)(2,280)(3,664)
(14)
(605)
(49)
(4,333)(6,428)(394)
1(1,111)(86)(1,591)(3,871)(6,055)(373)(3,722)(148)

5

3. Notes on the quarterly financial statements(Notes on the Going-concern Assumption)
Not applicable(Notes on significant changes in the amount of shareholders’ equity)
Not applicable(Application of accounting methods specific to the preparation of quarterly consolidated financial statements)
Calculation of tax liabilities
The Company calculates tax liabilities by producing a reasonable estimate of the effective tax rate after applying
tax-effect accounting to income before taxes for the fiscal year, which encompasses the three months ended March
31, 2017, and then multiplying income (loss) before income taxes by this estimated effective tax rate.

(Changes in accounting policies, changes in accounting estimates, and retrospective restatements)
Not applicable(Additional information)
Implementation Guidance on Recoverability of Deferred Tax Assets
Sapporo Holdings has applied the revised Implementation Guidance on Recoverability of Deferred Tax Assets(Accounting Standards Board of Japan [ASBJ] Guidance No. 26 of March 28, 2016) to its consolidated accounts fromthe first quarter of the year ending December 31, 2017.

13

4. Segment Information
Ⅰ

Three months ended March 31, 2016 (January 1, 2016 – March 31, 2016)

1. Sales, income, and loss by reportable segment(millions of yen)
Reportable segments
Japanese
Alcoholic
Beverages

International Food&
Restaurants
Soft Drinks

Real
Estate

Total

Other *1

Total

Amounts
reported on
Adjustments thestatements
of income *2

Net sales(1) Operating revenues(2) Intra-group sales and transfers
Total
Segment income (loss)

53,15015,421

30,237

5,793

5,376

109,979

1,411

575

30

32

1

604

1,243

4,149

53,726

15,451

30,270

5,794

5,980

111,2235,560(1,804)

(390)

(643)

(139)

2,610

(367)

(99)

111,391
5,392
116,784(467)-

111,391(5,392)(5,392)

111,391(960)(1,427)-

Notes:(1) "Other" comprises businesses, such as logistics businesses, that are not included in reportable segments.
(2) Segment income and losses are adjusted based on operating income reported on the quarterly consolidated statements of income for the corresponding period.

2. Reconciliation and main components of differences between income and loss of reportable segments and figures on the statement of income (information ondifferences)(millions of yen)Segment income (loss)

AmountTotal for reportable segments(367)

Total other losses
Unallocated corporate costs

(99)
(951)
(9)

Intra-segment sales
Operating losses on the statement of income(1,427)

3. Impairment Loss on Fixed Assets or Goodwill by Reportable Segment(Significant impairment losses on fixed assets)
Not Applicable(Significant changes in the amount of goodwill)In the International Business segment, previous financial disclosures included a provisional estimate of goodwill related to the acquisition of COUNTRY PUREFOODS, INC., on February 24, 2015, because allocation of the actual acquisition cost had yet to be completed. In the first quarter of 2016, however, allocation of
the acquisition cost was completed and the amount of goodwill was adjusted. This adjustment increases goodwill posted on accounts for the first-quarter of 2016 by¥264 million.

(Material Gain on negative goodwill)
Not Applicable14

ⅡThree months ended March 31, 2017 (January 1, 2017 – March 31, 2017)

1. Sales, income, and loss by reportable segment(millions of yen)
Reportable segments
Japanese
Alcoholic
Beverages

International Food&
Restaurants
Soft Drinks

Real
Estate

Total

Other *1

Total

Amounts
reported on
Adjustments thestatements
of income *2

Net sales(1) Operating revenues(2) Intra-group sales and transfers
Total
Segment income (loss)

54,485

16,631

31,569

6,452

5,900

115,038

2,750

742

17

39

0

613

1,413

4,404

55,228

16,64831,608

6,452

6,514

116,452

7,154(1,984)

(238)

(647)

(281)

2,931

(221)

(96)

117,788
5,818
123,606(318)-

117,788(5,818)(5,818)

117,788(1,134)(1,453)-

Notes:(1) "Other" comprises businesses, such as logistics businesses, that are not included in reportable segments.
(2) Segment income and losses are adjusted based on operating income reported on the quarterly consolidated statements of income for the corresponding period.

2. Reconciliation and main components of differences between income and loss of reportable segments and figures on the statement of income (information ondifferences)(millions of yen)Segment income (loss)

Amount(221)

Total for reportable segments
Total other losses
Unallocated corporate costs
Intra-segment sales
Operating losses on the statement of income(96)(1,179)44(1,453)

3. Impairment Loss on Fixed Assets or Goodwill by Reportable Segment(Significant impairment losses on fixed assets)
Not Applicable(Significant changes in the amount of goodwill)
Not Applicable(Material Gain on negative goodwill)
Not Applicable(Subsequent Events)
None15