Financial Results
For the Nine Months Ended September 30, 2008—Consolidated
October 31, 2008

Company name

Sapporo Holdings Limited

Security code
Listings
URL
Representative
Contact

2501
Tokyo Stock Exchange (First Section); Sapporo Securities Exchange
http://www.sapporoholdings.jp/english/
Takao Murakami, President and Group CEO
Tsutomu Kamijo, Director and General Manager of the Corporate
Planning Department+81-3-5423-7407

Telephone

1. Consolidated Financial Results for the Nine Months Ended September 30, 2008
(January 1, 2008 – September 30, 2008)(1) Operating Results(amounts rounded down to the nearest million yen;percentage figures represent year-over-year changes)
Net sales
Nine months ended
September 30, 2008
Nine months ended
September 30, 2007
Year ended
December 31, 2007

Nine months ended
September 30, 2008
Nine months ended
September 30, 2007
Year ended
December 31, 2007

Operating income

Ordinary income

Net income

million yen%

million yen%

million yen%

million yen%

306,572

(7.6)

9,066

44.5

6,534

72.0

14,286−331,802

3.7

6,273

60.3

3,798

75.5

(1,191)−

449,011

12,362

8,118

Net income
per share

Diluted
net income
per share

yen

yen

36.44

34.93

(3.05)

−

14.10

13.76

1

5,508

(2) Financial Position
Total assets

Net assets

Shareholders’equity ratio

Net assets per
sharemillion yen

million yen%

yen

Nine months ended
September 30, 2008

512,959

129,30425.2

329.17

Nine months ended
September 30, 2007

562,806

121,61121.6

309.90Year ended
December 31, 2007

561,858

125,18922.3

319.07(3) Cash Flows
Cash flows from
Cash flows from
Cash flows fromoperating activities investing activities financing activities

Cash and cash
equivalents at
end of period

million yen

million yen

million yen

million yen

Nine months ended
September 30, 2008

25,20626,011(40,945)

15,914

Nine months ended
September 30, 2007

33,212(17,056)(19,194)

5,227

Year ended
December 31, 2007

30,690(13,495)(19,568)

5,881

2. Forecast of Consolidated Earnings for the Year Ending December 31, 2008
(January 1, 2008 – December 31, 2008)

Net sales

Full year

Operating income(percentage figures represent year-on-year changes)
Net income
Ordinary income
Net income
per share

million yen%

million yen%

million yen%

million yen%

yen

426,300(5.1)

13,500

9.2

9,200

13.3

12,800

132.4

32.65

No change has been made to the earnings forecast for the year ending December 31, 2008
released on August 5, 2008.
3. Other(1) Changes affecting the status of significant subsidiaries (scope of consolidation): None
(2) Adoption of simplified accounting methods: Yes(3) Change in accounting methods from the last fiscal year: Yes
Appropriate Use of Earnings Forecasts and Other Important Information
The earnings forecast stated herein are based on information currently available and certain
assumptions for factors which may affect business results. Actual results may differ from theforecasts due to a range of factors.

2

1. Operating Results
1. Analysis of Operating Resultsa) Results for the Nine Months Ended September 30, 2008
Net sales for the nine months ended September 30, 2008, were down ¥25.2 billion, or
8% year over year, to ¥306.5 billion. Operating income increased by ¥2.7 billion, or 45%
year over year, to ¥9.0 billion, while the Group recorded ordinary profit of ¥6.5 billion, a
year-over-year increase of ¥2.7 billion, or 72%. Although net sales were negatively
impacted by a decline in sales volume in the Japanese Alcoholic Beverages business andthe review of unprofitable sales accounts in the Soft Drinks business, advertising andsales promotion expenses decreased along with other costs as the Group continued topursue low-cost operations. Net income improved to ¥14.2 billion, an increase of ¥15.4
billion compared to the same period last year. This was mainly attributable to a gain on
the sale of a 15% co-ownership stake in Yebisu Garden Place during the period.
1) Segment Information

Alcoholic Beverages (Japan)
Net sales in the Japanese Alcoholic Beverages business were down ¥13.1 billion, or 6%
year over year, to ¥218.2 billion, while operating income amounted to ¥4.2 billion, an
improvement of ¥3.0 billion, or 245%, compared to the same period last year.
Total demand in the Japanese beer and beer-type beverages market during the first
three quarters of the year was down 2.5% compared to the same period last year, largely
due to the fact that consumers increasingly shifted into belt-tightening mode in
response to an overall increase in food prices as well as higher prices for many otherconsumer goods.
Against this backdrop, sales of our core brands of canned beer and commercial-use kegs,
such as Sapporo Black Label and Yebisu, were strong, and sales increased following
improvements to our product mix. In the new-genre category, Mugi to Hop waslaunched this June and sales have been firm, which has boosted new product sales.
However, this was not enough to offset the drop in demand in the happoshu market andthe decline in sales of existing new-genre products. As a result, total sales of beer and3

beer-type beverages during the period were down 7% year over year.
Wine sales were up 4% compared to the same period last year. While total demand forboth domestic and imported wines moved sideways year over year, domestic wine sales
volume was helped by strong sales of the Aroma Mutenka line and large-volume wines,
while price increases on imported wines also supported the increase in total wine sales.
Shochu sales also grew, up 12.5% year over year. The increase was attributable to thepenetration of Waramugi, Karariimo, and other singly distilled shochu into thecommercial-use market, as well as the launch of new product Triangle Smooth and solid
sales of large-volume products.
Cost-wise, rising prices of ingredients and materials, particularly imported malt, barley,
and aluminum cans, exerted upward pressure on cost of sales. In response, we raised
prices on beer and beer-type beverages from April, clamped down on advertising andsales promotion expenses, and cut general overhead expenses and other costs. As resultof such initiatives to improve its earnings structure, the Japanese Alcoholic Beverages
business achieved significantly higher operating income compared to the same period
last year.

Alcoholic Beverages (Overseas)
Despite solid sales volumes, net sales in the Overseas Alcoholic Beverages business fell
¥1.3 billion, or 6% year over year, to ¥19.6 billion, due to adverse exchange rate
movements and other factors. Operating income was ¥0.3 billion, a decline of ¥1.5
billion, or 81%, from the same period last year.
In the North American beer market, competition is intensifying against a backdrop ofmeager growth in estimated total demand, but demand is growing solidly in certain
premium categories, such as domestic craft beers. However, the U.S. economy is in the
midst of a slowdown triggered by subprime mortgage woes dating back to 2007, andthere is concern about the impact on consumer spending going forward. Meanwhile, themarket for beer appears to be generally growing in Asian countries and other markets
outside of North America.

4

Amid this environment, we engaged in aggressive sales activities in the premium
market, where Sapporo is particularly competitive. In 2008, we began test-marketing ofYebisu Beer in the U.S. to determine acceptance in the high-end beer market. As aresult of these efforts, sales volume during the period was up 5% year over year at
Canadian subsidiary Sleeman Breweries and 10% year over year at Sapporo USA.
Export sales volume was also up 29% compared to the same period last year.
The Overseas Alcoholic Beverages business faced cost pressures from rising prices ofingredients and materials, mainly malt and aluminum cans. It also ramped up
marketing investments relative to the same period last year.

Soft Drinks
Net sales in the Soft Drink business were down ¥11.1 billion, or 28% year over year, to¥28.6 billion, reflecting changes to accounting policies and other factors. As businessrestructuring was carried out ahead of schedule, operating income turned positive, andalthough remaining below the billion yen mark, still represented a ¥0.8 billion
improvement over the same period last year.
In the Japanese soft drink market, estimated total demand remained at around thesame level year over year, supported by robust sales of carbonated beverages anddomestic mineral water.
Against this background, the Group is developing and growing its own unique brands
while also rapidly restructuring the Soft Drink business through a select-and-focus
approach and pursuing strategies aimed at transitioning to a sustainable earnings
structure.
Specifically, this effort involves the development and growth of high value-added
products, organizational restructuring and the redeployment of personnel, reviews of
unprofitable sales accounts, the efficient use of sales promotion expenditures, and the
reduction of vending machine costs.

5

Sales volume was down 17% compared to the same period last year. However, we
strengthened both the Gerolsteiner naturally carbonated water product line, a key
brand that we aim to develop over the medium- to long-term, and the Ocean Spray
Cranberry functional fruit juice product line. This expanded customer contact points
and reinforced our presence in the market. We also enhanced the Kissui brand canned
coffee product line, which has been rolled out nationwide, and sales for this producthave been strong.

Restaurants
Net sales in the Restaurant business were up ¥0.7 billion, or 4% year over year, to¥22.4 billion. Operating income increased ¥92 million, or 28%, compared to the same
period last year to ¥0.4 billion.
The restaurant industry continues to face a difficult business environment. With themarket on a trend of decline as society ages, the rising cost of food inputs and a decline
in consumption due to weak economic conditions are having an adverse effect.
Amid this environment, the Restaurant business worked to achieve steady growth bydeveloping food menus based on a commitment to safety, peace of mind, andauthenticity, as well as by raising the quality of service.
Existing establishments achieved year-over-year sales growth, as the strong
performance of beer halls made up for sluggishness in restaurants, where pre-bookedgroup events account for a large proportion of business, an area that has been hurt byweak economic conditions.
We opened seven new establishments during the nine-month period ended September
30, 2008, including the Kamuroan food court in the Mitsui Outlet Park facility locatedat the Port of Sendai, which serves Yamagata soba and Inaniwa udon, two popular
traditional Japanese noodle dishes. We closed three restaurants during the first quarter,
however, so the total number of restaurants in operation at the end of September 2008
was 205.

6

The Restaurant business’s cost-of-sales ratio was held in check, partly because weraised prices in April in conjunction with the rising cost food inputs, and also because
we thereafter streamlined food sourcing and concentrated order volumes with a
Web-based ordering system. The personnel cost ratio rose slightly, reflecting a tightlabor market. The overhead expense ratio, however, improved due to a decrease in new
store opening costs compared to the same period last year.

Real Estate
Net revenue in the Real Estate business was down ¥0.4 billion, or 3% year over year, to¥17.5 billion, while operating income was up ¥0.3 billion, or 6%, to ¥5.7 billion.
In the real estate market, office vacancy rates in central Tokyo have been slowly
drifting upward since the start of the year, and office rents remain high, although they
are in the process of flattening out.
Amid this environment, we maintained high occupancy rates and increased rents,
particularly in central Tokyo properties, including Yebisu Garden Place. Development
properties completed last year have exhibited stable occupancy rates and have been
contributing to earnings. We are also engaged in real estate development projects,
primarily in the Tokyo area, such as the property in Tokyo’s Shinjuku Ward that we
acquired in February.
Although revenues decreased following the sale of a 15% co-ownership stake in Yebisu
Garden Place this April, operating income increased in conjunction with a decline indepreciation and other factors.

7

2. Consolidated Financial Condition

Total consolidated assets amounted to ¥512.9 billion as of September 30, 2008, a decrease of ¥49.8
billion compared to September 30, 2007. This primarily reflects a decline in unrealized gains on
investment securities and a decrease in property, plant and equipment due to the sale of a 15%
co-ownership stake in Yebisu Garden Place and other factors.

Liabilities totaled ¥383.6 billion, a decrease of ¥57.5 billion compared to September 30, 2007. This
primarily reflects a decrease in short-term bank loans and decreases in liquor taxes payable andaccounts payable due to the last day of the quarter under review falling on a bank trading day.

The balance of net assets was ¥129.3 billion, an increase ¥7.6 billion compared to September 30,
2007. This increase reflects an increase in retained earnings and is despite a decrease in both theunrealized holding gain on securities and foreign currency translation adjustments.

Cash flows for the nine months ended September 30, 2008, were as follows.

Net cash provided by operating activities was ¥25.2 billion. The net inflow was mainly due toincome before income taxes and minority interests of ¥24.4 billion and a decrease in accounts
receivable of ¥18.0 billion, which were offset by a ¥15.5 billion reduction in liquor taxes payable
and other factors.

Net cash provided by investing activities was ¥26.0 billion. This primarily reflects outflows of ¥15.9
billion for the acquisition of property, plant and equipment being offset by proceeds of ¥49.0 billion
from the sale of property, plant and equipment.

Net cash used in financing activities was ¥40.9 billion. This primarily reflects a ¥29.0 billion
decrease in short-term bank loans and ¥27.1 billion in repayments of long-term debt, which offset
proceeds from long-term debt of ¥17.2 billion.

Consolidated cash and cash equivalents as of September 30, 2008, totaled ¥15.9 billion.

8

Consolidated Balance Sheets
As of September 30, 2007 (A) As of September 30, 2008 (B)AmountAssetsI Current assets
1 Cash and cash equivalents
2 Notes and accounts receivable - trade
3 Inventories
4 Other current assets
5 Allowance for doubtful receivables
Total current assets
II Fixed assets
1 Property, plant and equipment
2 Intangible assets
3 Investments and other assets
Total fixed assets
Total assets
Liabilities
I Current liabilities
1 Notes and accounts payable
2 Short-term bank loans
3 Liquor taxes payable
4 Other
Total current liabilities
II Long-term liabilities
1 Bonds
2 Long-term bank loans
3 Employees' retirement benefits
4 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 Valuation and translation
adjustments
1 Unrealized holding gain on
securities
2 Foreign currency translation
adjustments
Total valuation and translation
adjustments
III Minority Interests
Total net assets
Total liabilities and net assets

5,864
60,02525,58518,000(172)
109,303% of total

Amount(in millions of yen, except percentages)
As of December 31, 2007
(B)-(A)% of total AmountAmount% of total

19.4

16,09051,02923,82014,069(163)
104,845

80.6
100.0

316,816
29,93561,362
408,114
512,959

40.1

24,323
26,736
22,461
98,830172,351

69,71068,123
15,31562,295215,445441,194

38.3
78.4

73,55371,828
7,378
58,543211,303
383,655

41.2
74.8

3,843
3,704
(7,937)(3,752)(4,141)(57,539)

53,88646,3097,592(793)
106,994

9.6
8.2
1.3
(0.1)
19.0

53,88646,31826,618(1,010)125,812

10.5
9.0
5.2
(0.2)
24.5

9
19,025(217)
18,81753,88646,31014,292(848)
113,641

9.6
8.2
2.5
(0.1)
20.2

13,186

2.3

4,692

0.9

(8,493)

9,640

1.7

1,377

0.3

(1,475)(0.3)(2,853)

1,853

0.4

14,563

2.6

3,216

0.6

(11,346)

11,493

2.1

52
121,611562,806

0.0
21.6
100.0

274
129,304
512,959

0.1
25.2
100.0

221
7,693
(49,846)53
125,189
561,858

0.0
22.3
100.0

345,192
34,00874,301
453,502562,806

29,692
64,83937,45893,758
225,749

9

20.4

10,226(8,996)(1,765)(3,930)8(4,458)6,511
69,68524,041
17,754(275)
117,717

21.0

79.6
100.0

(28,376)(4,072)(12,938)(45,388)(49,846)

338,504
33,36872,267444,141
561,858

79.0
100.0

33.6

(5,369)(38,103)(14,996)
5,071(53,397)

26,12164,41538,14094,824
223,501

39.8

69,71074,33915,13553,984
213,168
436,669

37.9
77.7

Consolidated Statements of Income(in millions of yen, except percentages)
Nine months ended September Nine months ended September 30,
30, 2007 (A)2008 (B)

331,802
224,504
107,298

100.0
67.7
32.3

306,572
213,034
93,538

% of
total
100.0
69.5
30.5

101,024

30.4

84,471

6,273

1.9

9,066

AmountI Net sales
II Cost of sales
Gross profit
III Selling, general and administrative
expenses
Operating income (loss)
IV Non-operating income
1 Interest and dividend income
2 Equity in income of affiliates
3 Other
V Non-operating expenses
1 Interest expense
2 Loss on disposal of inventories
3 Equity in loss of affiliates
4 OtherOrdinary income
VI Extraordinary gains
1 Gain on sales of property, plantand equipment
2 Gain on sales of investment securities
3 Reversal of provision for doubtfulreceivables
4 other
VII Extraordinary losses
1 Loss on disposal of property,
plant and equipment
2 Loss on impairment of property,
plant and equipment
3 Depreciation expenses resulting
from revision of residual value
4 Provision for gift voucher redemptions
5 Loss on revision of retirement benefit
plan
6 Early retirement benefits
7 Business reorganization costs
8 Amortization of goodwill
9 Devaluation of marketablesecurities and investments
Income before income taxes and minority interests
Current income taxes
Deferred income taxes
Minority interests
Net income

706
82
748
3,221
314
−
476

Amount% of total

1,537

4,012
3,798

737
34
619

0.4

2,846
823
−
253

1.2
1.1

1,391

3,923
6,534

(B)-(A)

Fiscal year ended
December 31, 2007

AmountAmount(25,230)(11,470)(13,760)

449,011305,078
143,933

% of
total
100.0
67.9
32.1

27.5

(16,552)

131,570

29.3

3.0

2,792

12,362

2.8

2,306

0.5

6,550
8,118

1.5
1.8

7,596

1.7

15,493

3.5

221

0.0

(5,285)
1
5,508

(1.2)
0.0
1.2

0.4

1.3
2.1

(145)

(89)
2,735

1,026
−
1,280
4,280
858
132
1,280

101

25,811

6,769

407

4

766

185
32

32
726

0.2

111

27
25,9608.5

25,233

32

780

3,068

1,300

570

1,325

6,939

7,235

−

6,583

−

746

−

−

1,178

−

−
−
−

247
1,441
−

−
−
276

64
1,960
(4,892)

8,650

2.5

(4,125)(1.2)(2,932)
1(1,191)

85
4,128
6,014

(0.8)
0.0
(0.4)

10

8,093

2.6

(557)

24,4008.0

28,525

10,14329
14,286

3.3
0.0
4.7

13,07527
15,477393
3,349(8,634)

Statement of Changes in Shareholders’ Capital
Nine months ended September 30, 2007

(January 1, 2007 – September 30, 2007)(millions of yen)
Shareholders' capital

Common stock Capital surplus
Balance as of December 31,
2006
Changes during period
Issuance of new shares
Increase in retained
earnings due to increase in
number of consolidated
subsidiaries
Cash dividends
Net loss
Purchase of treasury stock
Disposition of treasurystock
Net change in items otherthan shareholders’ capitalduring period
Total changes during period
Balance as of September 30,
2007

50,06642,484

3,820

3,820

Retainedearnings

Treasury stock

10,472

(571)

Total
shareholders'
capital102,451
7,640

202

202

(1,890)(1,191)(227)(1,890)(1,191)
(227)

5

10

4

3,820

3,824

(2,879)

(222)

4,543

53,88646,309

7,592

(793)

106,994

Valuation and translation adjustments
Net unrealized
gains (losses) onother securities
Balance as of December 31,
2006
Changes during period
Issuance of new shares
Increase in retained
earnings due to increase in
number of consolidated
subsidiaries
Cash dividends
Net loss
Purchase of treasury stock
Disposition of treasurystock
Net change in items otherthan shareholders’ capitalduring period
Total changes during period
Balance as of September 30,
2007

11,318Foreigncurrency
adjustments(276)

Total valuationand translation
adjustments
11,041

Minority
interests

Total net assets

2

113,495
7,640
202(1,890)(1,191)
(227)
10

1,867

1,654

3,522

50

3,572

1,867

1,654

3,522

50

8,115

13,186

1,377

14,563

52

121,611

11

Statement of Changes in Shareholders’ Capital
Nine months ended September 30, 2008

(January 1, 2008 – September 30, 2008)(millions of yen)
Shareholders' capital

Common stock Capital surplus
Balance as of December 31,
2007
Changes during period
Cash dividends
Net income
Purchase of treasury stock
Disposition of treasurystock
Net change in items otherthan shareholders’ capitalduring period
Total changes during period
Balance as of September 30,
2008

53,88646,310Retainedearnings
14,292

Treasury stock(848)

113,641(177)(1,960)14,286
(177)

15

23

(1,960)14,286
8

53,886

Total
shareholders'
capital8

12,325(162)

12,171

46,31826,618(1,010)125,812Valuation and translation adjustments
Net unrealized
gains (losses) onother securities
Balance as of December 31,
2007
Changes during period
Cash dividends
Net income
Purchase of treasury stock
Disposition of treasurystock
Net change in items otherthan shareholders’ capitalduring period
Total changes during period
Balance as of September 30,
2008

9,640

Foreigncurrency
adjustments
1,853

Total valuationand translation
adjustments
11,493

Minority
interests

Total net assets

53

125,189(1,960)14,286(177)
23(4,947)(3,329)(8,277)220(8,056)(4,947)(3,329)(8,277)220(8,056)

4,692(1,475)

3,216

274

129,304

12

Statement of Changes in Shareholders’ CapitalYear ended December 31, 2007

(January 1, 2007 – December 31, 2007)(millions of yen)
Shareholders' capital

Common stock Capital surplus
Balance as of December 31,
2006
Changes during period
Issuance of new shares
Cash dividends
Increase in retained
earnings due to increase in
number of consolidated
subsidiaries
Net income
Purchase of treasury stock
Disposition of treasurystock
Net change in items otherthan shareholders’ capitalduring period
Total changes during period
Balance as of December 31,
2007

50,06642,484

3,820

3,820

Retainedearnings

Treasury stock

10,472

(571)

Total
shareholders'
capital102,451(1,890)7,640(1,890)

202

202

5,508
(284)

5,508
(284)

7

12

5

3,820

3,825

3,820

(277)

11,18953,88646,31014,292(848)

113,641

Valuation and translation adjustments
Net unrealized
gains (losses) onother securities
Balance as of December 31,
2006
Changes during period
Issuance of new shares
Cash dividends
Increase in retained
earnings due to increase in
number of consolidated
subsidiaries
Net income
Purchase of treasury stock
Disposition of treasurystock
Net change in items otherthan shareholders’ capitalduring period
Total changes during period
Balance as of December 31,
2007

11,318Foreigncurrency
adjustments(276)

Total valuationand translation
adjustments
11,041

Minority
interests

Total net assets

2

113,495
7,640(1,890)
202
5,508
(284)
12

(1,677)

2,129

452

51

503

(1,677)

2,129

452

51

11,693

9,640

1,853

11,493

53

125,18913

Consolidated Statements of Cash Flows(amounts in millions of yen)
Nine months ended Nine months ended Fiscal year ended
September 30, 2007 September 30, 2008 December 31, 2007
AmountAmountAmountI Cash flows from operating activities
1 Income (loss) before income taxes and minority interests
2 Depreciation and amortization
3 Depreciation expenses resulting from revision of residual value
4 Loss on impairment of property, plant and equipment
5 Amortization of goodwill
6 Decrease in employees’ retirement benefits
7 Decrease in allowance for doubtful receivables
8 Interest and dividend income
9 Interest expense
10 Gain on sales of property, plant and equipment
11 Loss on sales and disposal of property, plant and equipment
12 Decrease in notes and accounts receivable - trade
13 (Increase) decrease in inventories
14 Increase (decrease) in notes and accounts payable
15 Decrease in liquor taxes payable
16 Increase in other current liabilities
17 Other
Sub total
18 Interest and dividends received
19 Interest paid
20 Income taxes paid
Net cash provided by (used in) operating activities
II Cash flows from investing activities
1 Purchases of investment securities
2 Proceeds from sales and redemption of investment securities
3 Purchases of property, plant and equipment
4 Proceeds from sales of property, plantand equipment
5 Purchases of intangibles
6 Increase in long-term loans receivable
7 Collection of long-term loans receivable
8 Other
Net cash provided by (used in) investing activities
III Cash flows from financing activities
1 Decrease in short-term bank loans
2 Proceeds from long-term debt
3 Repayment of long-term debt
4 Proceeds from issuance of bonds
5 Redemption of bonds
6 Net increase (decrease) in commercial paper
7 Cash dividends paid
8 Other
Net cash provided by (used in) financing activities
IV Effect of exchange rate changes on cash and cash equivalents
V Net increase (decrease) in cash and cash equivalents
VI Cash and cash equivalents at beginning of period
VII Cash and cash equivalents of additional consolidated
subsidiaries
VIII Cash and cash equivalents at end of period

14(4,125)
18,583
7,235
570
−
(985)
(351)
(706)
3,221
(101)
780
14,013
(799)
570
(883)
−
375
37,397758(2,987)(1,955)33,212

24,400
16,295−
1,325
651(7,756)
(431)
(737)
2,846
(25,811)
3,068
18,022(392)(1,480)(15,575)
9,636
7,973
32,035829(2,618)(5,039)25,206

221
24,526
6,583
6,939
869
(1,166)(295)(1,026)
4,280(6,769)
1,300
4,387
777
(3,015)(207)
327(1,445)36,288991(4,237)(2,350)30,690(93)
1,796(14,377)(1,164)104(15,904)

(250)
2,804
(17,815)134

49,0007,206(2,321)(74)
280(2,400)(17,056)(2,995)(520)
198(2,706)26,011(2,067)(74)
414(3,711)(13,495)(2,914)
9,001(43,102)19,925(10,000)
10,000(1,886)(217)(19,194)(32)(3,070)8,282(29,037)
17,274(27,161)
3,843−(4,000)(1,961)
96(40,945)(239)
10,032
5,881(4,999)24,001(50,335)
19,925(10,000)
4,000(1,888)(271)(19,568)(43)(2,416)
8,282

15

−

15

5,227

15,914

5,881

Segment Information
1. Segment Information by Business

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

I Net sales and operating expenses
Net sales(1) Operating revenues(2) Intra-group sales and transfers
Total
Operating expenses
Operating income (loss)(millions of yen)
Nine months ended September 30, 2007 (January 1, 2007 – September 30, 2007)
Corporate
Alcoholic
Soft
Real
Restaurants
Total
Consolidated
andBeverages
DrinksEstateeliminations

252,392
4,800
257,193
254,038
3,154

39,747
216
39,96340,724(760)

21,613−
21,613
21,277336

18,0492,000
20,04914,6495,400

331,8027,017
338,820
330,6898,130

331,802−331,802
325,529
6,273−(7,017)(7,017)(5,160)(1,856)(millions of yen)
Nine months ended September 30, 2008 (January 1, 2008 – September 30, 2008)
Corporate
Alcoholic
Soft
Real
Restaurants
Total
Consolidated
andBeverages
DrinksEstateeliminations

237,947
4,443
242,391
237,791
4,600

28,638221
28,86028,80357

22,407−22,407
21,978429

17,577
1,775
19,353
13,6295,723

306,5726,440
313,013302,202
10,810306,572−
306,572
297,506
9,066−(6,440)(6,440)(4,696)(1,744)(millions of yen)

I Net sales and operating income (loss)
Net sales(1) Operating revenues(2) Intra-group sales and transfers
Total
Operating expenses
Operating income (loss)
II Assets, Depreciation andAmortization, Impairment
and Capital Expenditures
Identifiable assets
Depreciation and amortization
Loss on impairment
Capital expenditures

Year ended December 31, 2007 (January 1, 2007 – December 31, 2007)
Corporate
Alcoholic
Soft
Real
Restaurants
Total
and
Beverages
DrinksEstateeliminations

Consolidated

343,670
6,323
349,993
342,139
7,854

52,239330
52,56953,408(839)

28,954−28,95428,298656

24,147
2,639
26,787
19,714
7,073

449,0119,293
458,305
443,560
14,744−(9,293)(9,293)(6,912)(2,381)

449,011−449,011436,648
12,362334,827
15,525204
13,988

9,618
425
570
394

14,542
799
214
1,706

187,815
7,776
5,950
3,458

546,804
24,526
6,939
19,54815,053−−−561,858
24,526
6,939
19,548Notes:(1) Segment classifications reflect the similarity of constituent businesses and take into account standard industry
classifications in Japan.
(2) Main products in each segment
Business Segment
Alcoholic beverages
Soft drinks
Restaurants
Real estate

Main Products
Beer, happoshu, wine, Western liquors, shochu, distribution, brewing
equipment, and agribusiness
Soft drinks and other non-alcoholic beverages
Operation of beer halls and restaurants
Real estate leasing, real estate sales, operation of commercial facilities,
utility supplies, and fitness clubs(3) Unallocated operating expenses included in "Corporate and eliminations" : 1,861 million yen at September 30, 2007,
1,779 million yen at September 30, 2008 and 2,477 million yen at December 31, 2007.
These are operating expenses incurred by Sapporo Holdings (as holdings company).

(4) Change in accounting methods

January 1, 2007 ‒ September 30, 2007
No applicable information

January 1, 2008 ‒ September 30, 2008
1) Accounting method for sales
Effective from the fiscal year ending December 31, 2008, the Company has adopted a new accounting method for the calculation of sales, and now deducts sales
incentives paid to clients from net sales. The value of sales incentives depends on the sales prices of soft drinks and other non-alcoholic beverages. Due to thischange, net sales and operating expenses in the Soft Drink segment for the nine months ended September 30, 2008, were each 5,062 million yen lower than theamounts that would have resulted with the previous method, but there was no effect on operating loss.
2) Accounting method for calculating revenue and expenses of foreign subsidiaries
Effective from the fiscal year ending December 31, 2008, the Company has adopted a new accounting method that uses the average exchange rate during theperiod when calculating the revenue and expenses of foreign subsidiaries. Due to this change, in the Alcoholic Beverages segment, operating revenue for the ninemonths ended September 30, 2008, was 834 million yen higher and the operating loss was 0 million yen lower than the amounts that would have resulted with theprevious method.

January 1, 2007 – December 31, 2007
No applicable information

15