2012
Sapporo Group Business Results Presentation
for the Nine Months ended September 30, 2012

November 7, 2012

Sapporo Holdings Ltd.
URL http://www.sapporoholdings.jp/english/

Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

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Contents

1. Progress of Implementation of 2012 Basic Strategies
2. Overview of Results for the First Nine Months of 2012
3. 2012 Full-Year Earnings Forecasts
Reference: Supplementary Information to Results for theFirst Nine Months of 2012

Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

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1. Progress of Implementation of2012 Basic Strategies

Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

3/25

Progress of Implementation of 2012 Basic Strategies
We promoted three basic strategies for achieving dramatic growth
Accept challenges leading to
growth in all businesses

Create new growth
opportunities

Steadfastly implement
growth measures

We will leverage the strengths of ourvarious businesses’ brands andmanagement resources to accept
new challenges to beatthe competition

We will continue to aggressively
pursue M&As and alliances
both in Japan and overseas

To realize the fruits of the various
initiatives undertaken in recent years,
we will continue to make forward
investments and take steps tostrengthen the business foundation

Accepting challenges leading to growth inall businesses¾ See the segment pages under Supplementary
Information to Results for the First Nine
Months of 2012

Create new growth opportunities¾ On January 31, we acquired a 15% stake in M’s
Beverage Co., Ltd., a wholly owned alcoholic
beverage distribution subsidiary of Maeil Dairies Co.,
Ltd. for approx. ¥51 mn to boost Sapporo’s brandvalue and strengthen our product distribution
network in South Korea. *A non-equity method
affiliate¾ On January 31, we acquired 51% of outstanding
shares in Silver Springs Citrus, the largest U.S.
maker of private-brand chilled drinks, from the
Toyota Tsusho Group for approx. ¥1.8 bn to make afull-scale entry into the U.S. beverage business.
*Started consolidating the profit/loss items from April

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Progress of Implementation of 2012 Basic Strategies
Steadfastly implement growth measures¾ Steps for boosting the value of Yebisu Garden Place•Increased the stake in Yebisu Garden Place to 100% in March 2012; started implementing measures to boost its value
towards its 20th anniversary in 2014.
• Taking into account the anticipated recovery in rent levels from 2013 onwards when excess supply in the real estate rental market
caused by the boom in new office building construction is eliminated, we have embarked on renovation of properties to boost their value
starting this year.
•In addition to improving the convenience of the offices, we will refurbish them with a focus on features including disaster prevention
measures, safety and security and a power supply structure to ensure business continuity during disasters.
•Refurbish commercial and restaurant facilities to boost the attractiveness of the entire
Ebisu region in addition to that of Yebisu Garden Place.

¾ Progress in integration towards start-up of
POKKA SAPPORO FOOD & BEVERAGE LTD. in January 2013
•Currently developing business plan for 2013 onwards including anticipatedsynergies from integration, to be announced in February next year.
•Announced the new structure and new organization on October 3 in addition to thelogo.
Logo of POKKA SAPPORO FOOD &BEVERAGE LTD.

Yebisu Garden Place(opened in 1994)¾ Strengthening of the alcoholic beverages and soft drinks business in Southeast Asia
• Alcoholic beverages business: Position Vietnam as the bridgehead and gradually expand into neighboring countries.
• Soft drinks business: With Pokka Singapore at the center, take measures to gradually boost the presence in surrounding
countries.
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Progress of Implementation of 2012 Basic Strategies
Steadfastly implement growth measures¾ Progress in the business in Vietnam, where we made a full-scale entry•We entered the Vietnamese market at the end of February 2012 and launched full-scale marketing from April. Sales volume
and exports to surrounding countries have been making good progress.
•In Vietnam, our products are being delivered to about 1,400 restaurants primarily in Ho Chi Minh as of the end of September and about
1,400 retail outlets such as CVS and major supermarkets.
•We started exporting to surrounding countries earlier this year. As of the end of September, we were exporting to Malaysia, Singapore,
Thailand, Australia, New Zealand and South Korea.
•We plan to start exporting to the Philippines, Indonesia, Cambodia and Myanmar.
• With the addition of the above four countries, the Sapporo brand will have a presence in eight out of the 10 ASEAN countries
June and September single month index when February single
month sales volume (excl. exports) is set as 100

Changes in beer consumption in Vietnam(unit: 10,000 kiloliters）
300

500

The 3rd largest market in Asia
after China and Japan

It is expected to reach the size of
the Japanese market by 2020

265

470
390

400

250

230

200

300

180

185

2007

2008

160
150

200
100
100

100

0

50

February

June

September

141

0
2005

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2006

2009

2010

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Progress of Implementation of 2012 Strategic Investments
Implementation Status of Strategic Investments(incl. ordinary capex)<Acquisition of stake in Silver Springs Citrus>¾ Acquired 51% of outstanding shares in Silver Springs Citrus andmade it a consolidated subsidiary¾ Started consolidating the balance sheet from the end of March andprofit/loss items from April¾ The cost of the share acquisition is approx. ¥1.8 bn¾ Net financial liabilities were approx. ¥0.7 bn

Total investment is approx. ¥2.5 bn<Acquisition of shares in M’s Beverage>¾ Acquired a 15% stake at the end of January (non-equity method
affiliate)

Total investment is approx. ¥50 mn<Acquisition of 15% of trust beneficiary rights in Yebisu
Garden Place>¾ Acquired from the joint holder on March 1 and started to reflect
profit/loss items from March

Total investment is approx. ¥40.5 bn<Capex (on a cash basis)/lease payments>
Consolidated total of approx. ¥10.4 bn¾ Breakdown: Japanese Alcoholic Beverages: ¥2.4 bn; International:¥0.9 bn; Soft Drinks: ¥0.1 bn; POKKA Group:¥4.0 bn;
Restaurants:¥0.5 bn; Real Estate:¥1.2 bn; General corporate: ¥1.3
bn, etc.

<Other investments> Consolidated total of approx. ¥2.9 bn¾ Breakdown: Japanese Alcoholic Beverages, POKKA Group, etc.
<Implementation status of strategic investment from Jan to Sep
2012 (incl. ordinary capex)>¾ Approx. ¥56.4 bn
Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

Credit Ratings<Announcement of the acquisition of 15% of trust beneficiaryrights for Yebisu Garden Place>¾ On December 26, 2011, issued a press release that we acquired
the rights from the joint holder for ¥40.5 bn<Credit rating by JCR>
¾ On February 16, 2012, JCR issued a press release saying that it
kept the A- (stable) rating on Sapporo Holdings unchanged.
<Credit rating by R&I>
¾ On March 15, 2012, R&I issued a press release saying that it kept
the BBB+ (stable) rating unchanged.
<Achievement of low-cost finance>¾ In March, issued five-year straight bonds worth ¥10 bn at a low
cost.
Direction of Long-term Strategic Investments¾ We will continue to actively carry out strategic investments
for growth.
¾ We expect to make ¥150 bn to ¥200 bn worth of strategic
investments from 2012 to 2016 (basically accumulation of
cash flows from operations).
– Including ordinary capex (worth about half of the strategic
investments)¾ Strategic investment for 2012 is planned to be approx. ¥64 bn(incl. ordinary capex)

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2. Overview of Results for the First Nine Months of 2012

Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

8/25

Overview of Results for the First Nine Months of 2012: Special Factors
Breakdown of special factors that do not allow meaningful comparisons between net sales and operating income for the firstnine months of 2012 and the same period a year earlier
See the Supplementary Information to our Earnings Report for factors behind changes resulting from other businessactivities

Net Sales<International>¾ We started consolidating the profit/loss items ofSilver Springs Citrus from April ⇒ approx. +¥4.6 bn<Food & Soft Drinks: POKKA Group>¾ We started adding the profit/loss items from April
2011 and this meant net increase for the Jan -Mar
period ⇒ approx. +¥22.3 bn<Real Estate>¾ Started reflecting the profit/loss items from Marchfor the acquisition of 15% of trust beneficiary rights
for Yebisu Garden Place from the joint holder in thecomplex ⇒ approx. +¥1.4 bn<Total>¾ Approx. +¥28.3 bn

Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

Operating Income<International>¾ We started consolidating the profit/loss items of Silver
Springs Citrus in April ⇒ approx. +¥0.1 bn<Food & Soft Drinks: Sapporo Beverage>¾ In April 2011 we started goodwill amortization for theacquisition of shares from Crescent Partners after it
converted CB holdings, and goodwill amortization was
a net increase in the Jan-Mar period of 2012 ⇒ approx.
-¥0.2 bn
<Food & Soft Drinks: POKKA Group>¾ Started reflecting the profit/loss items from April 2011,
resulting in an operating loss for the Jan-Mar period of2012 ⇒ approx. -¥0.5 bn¾ Started reflecting the profit/loss items from April 2011and goodwill amortization resulting from the integrationof the POKKA Group was a net increase in the Jan Mar period of 2012 ⇒ approx. -¥0.4 bn<Real Estate>¾ Acquired 15% of trust beneficiary rights for Yebisu
Garden Place from the joint holder in the complex andhave been reflecting the profit/loss items from March⇒ approx. +¥0.8 bn<Total>¾ Approx. -¥0.2 bn
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Overview of Results for the First Nine Months of 20122011 3Q results 2012 3Q results¾ Net sales: up YoY(billions of yen)Japanese Alcoholic
Beverages

191.5

195.5

4.0

2.1%

19.4
74.7

26.3
95.6

6.9
20.8

35.5%
27.9%

24.8
49.9

23.2
72.3

(1.5)
22.4

(6.4)%
44.9%

Restaurants

17.8

19.3

1.4

7.9%

Real Estate

16.6

17.3

0.7

4.4%

Other

0.5

0.6

0.0

4.1%

Consolidated net sales

320.7

354.7

33.9

10.6%

Operating income before GW
amortization

14.4

8.4

(5.9)

(41.4)%

Japanese Alcoholic
Beverages

5.0

0.8

(4.1)

(82.8)%

International

0.5

0.1

(0.4)

(74.9)%

1.2
(0.6)

1.4
(1.3)

0.2
(0.7)

19.2%
―

Food & Soft Drinks

2.8

(0.1)

(2.9)

―

Sapporo Beverage
POKKA Group
Before GW amortization

1.0
1.7
4.1

0.2
(0.4)
1.8

(0.7)
(2.1)
(2.2)

(74.4)%―(54.6)%

Other

(0.0)
6.4
(0.5)

0.2
7.1
(0.3)

0.3
0.7
0.2

―
11.6%
―

General corporate

(1.9)

(2.4)

(0.4)

―

Consolidated operating income

12.2

5.5

(6.6)

(54.4)%

Consolidated ordinary income

10.5

4.4

(6.1)

(58.1)%

Consolidated net income

0.5

0.5

0.0

4.1%

Sales increased on recovery of Japanese
Alcoholic Beverages and Restaurants,
which were directly affected by the 2011
earthquake, as well as the special factors
discussed in the previous slide.

International
Food & Soft Drinks
Sapporo Beverage
POKKA Group¾ Operating income: down YoY

Despite profit increase at Restaurants andReal Estate on increased sales, overall
operating income decreased by ¥6.6 bn
YoY due to increased marketing costs
compared with the previous year inJapanese Alcoholic Beverages and Food &Soft Drinks, reversion to the norm after thesurge in demand in Food & Soft Drinks
following the earthquake last year, andincreased investment by International
Business for development of the Vietnam
market in addition to the special factors
described in the previous slide.
(Operating income before GW amortization
decreased by ¥5.9 bn YoY)

North America
Vietnam¾ Net income: roughly unchanged

Net income remained roughly unchanged
from the previous year as extraordinary
losses declined ¥6.4 bn YoY (mainly a ¥1.0
bn loss due to asset retirement obligations
and a ¥4.7 bn loss stemming from thedisaster in the previous year.).
*The 2011 first quarter consolidated net sales figure lacks
continuity with the figure announced last year due toretrospective adjustment of past years from the first quarter offiscal 2012.
* POKKA Group’s profit/loss items have been consolidated
since the second quarter of fiscal 2011.

YoY changes(amount, %)Restaurants
Real Estate

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3. 2012 Full-year Forecast* 2012 full-year earnings forecasts announced on August 7 remainunchanged

Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

11/25

2012 Full-year Forecasts
2011 Results(billions of yen)2012 Targets

YoY change(amount,%)

Japanese Alcoholic Beverages

268.1

277.5

9.3

3.5%

Full-year forecast isunchanged

International

25.8

37.3

11.4

44.1%

108.0

128.1

20.0

18.5%

32.2
75.8

30.1
98.0

(2.1)
22.1

(6.6)%
29.2%

The Group is
implementing measures toachieve a consolidated
operating income of ¥16.0
bn (¥19.9 bn before GW
amortization).

Restaurants

24.0

24.9

0.8

3.4%

Real Estate

22.4

24.4

1.9

8.6%

Other

0.7

0.8

0.0

5.9%

Consolidated net sales

449.4

493.0

43.5

9.7%

Operating income before GW
amortization

21.9

19.9

(2.0)

(9.5)%

Japanese Alcoholic Beverages

9.3

9.0

(0.3)

(3.3)%

International

0.3

0.0

(0.3)

―

1.4
(1.0)

1.8
(1.8)

0.4
(0.8)

28.9%
―

Food & Soft Drinks
Sapporo Beverage
POKKA Group

North America
Vietnam*The 2011 first quarter consolidated net sales figure
lacks continuity with the figure announced last year
due to retrospective adjustment of past years fromthe first quarter of fiscal 2012.
* POKKA Group’s profit/loss items have been
consolidated since the second quarter of fiscal 2011.

Food & Soft Drinks

3.6

0.2

(3.4)

(94.6)%

Sapporo Beverage
POKKA Group
Before GW amortization

0.7
2.9
5.7

(0.2)
0.4
2.9

(0.9)
(2.5)
(2.8)

―
(86.4)%(49.5)%

Restaurants

0.2

0.6

0.3

173.8%

Real Estate

8.5

9.3

0.7

8.7%

Other

(0.6)

(0.4)

0.2

―

General corporate

(2.6)

(2.7)

(0.0)

―

Consolidated operating income

18.8

16.0

(2.8)

(15.3)%

Consolidated ordinary income

16.8

13.0

(3.8)

(22.7)%

Consolidated net income

3.1

3.6

0.4

13.8%

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12/25

Reference: Supplementary Information to Results for
the First Nine Months of 2012

*For information on each business’s profitability, please also see thesupplementary information to our earnings report

Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

13/25

Japanese Alcoholic Beverages (1)(billions of yen)

Year-over-year changes

Results highlights
2011 3Q

2012 3Q

AmountNet sales*

191.5

195.5

4.0

2.1%

Operatingincome

5.0

0.8

(4.1)

(82.8)%*Incl. liquor taxes

Net sales increased reflecting the July launch of Hokkaido PREMIUM
in the new-genre beer product categoryand the rebound from thedirect impact of the earthquakeas well as strong sales of the threecore brands. Operating income declined due to the cost incurredfrom aggressive marketing and increased burden of fixed cost during
the down period for the loss caused by the 2011 disaster.

Key points in business plan: implementation status%

YoY sales volume for Jan-Sep (beer, happoshu, new-genre beer products)

104 ％

103.0

Sapporo102.6

General demand

1. Bolster brand strengths of core products¾ Further bolster brand strength of the three core brands of Sapporo
Draft Beer Black Label, Yebisu Beer and Mugi to Hop and of Premium
Alcohol Free, a non-alcoholic beer-taste beverage.
¾ While the rebound from the direct impact of the earthquake also
contributed, we focused on the three core brands as Jan-Sep total
shipments of Sapporo beer,happoshu, and new-genre beer products
were 100.2% compared with the same period a year earlier, outperforming
the 99.3% for general demand, and increasing the market share.
¾ With the contribution from Premium Alcohol Free Black, theworld’s first
non-alcoholic canned dark beer introduced on May 23, sales of Premium
Alcohol Free increased 11.6% year over year in the Jan-Sep period.
However, the brand fell short of achieving the target partly due to new
products launched by competitors.

100.5

101

100.2

100.2

99.3
98.2
98
96.3
95
Jan- Mar

Apr- Jun

Jul- Sep

Jan- Sep

Launched
July 11¾ With the contribution from Mugi to Hop Black introduced on March 28, salesof Mugi to Hop rose 3.1% YoY in the Jan-Sep period, outperforming the
101% for general demand, and increasing the market share.
¾ We introduced new-genre beer product Hokkaido PREMIUMon July 11 as arefreshingly-flavored product to enhance the lineup.
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14/25

Japanese Alcoholic Beverages (2)Key points in business plan: implementation status

2. Laying the groundwork for growth in expanding areas

3. Expand sales of wine, western spirits and shochu

RTD-related actions <Sapporo’s first year of promoting ReadyWine
To Drink products: Triple the sales>¾ Sales of both imported and Japanese wines achieved year-over¾While sales for Jan-Sep period significantly exceeded the level foryear growth
the same period a year earlier by 56%, this did not meet our target ¾ Imported wine: Growth in Yellow Tail and Garcia Carrion
as competition intensified with the introduction of new products by¾ Japanese wine: Growth in Grande Polaire and additive-free wines
competitors.
¾Going forward, we will re-launch existing products and carry out
Western Spirits
line extension while expanding offering of trial drinks and ensuring¾ Signed sales agreement with No.1 Korean foods maker CJ (Cheil
market penetration in addition to developing products that can bring
Jedang) Group. Launched CJ Bonga Makgeolli in July 2011 in theabout collaborative synergies and arouse public interest.
industrial-use market. Sales are growing at a faster-than-expected¾As shown below, we actively introduced new products in Jul-Sep
pacejust as we did in the Jan-Jun period:¾ Entered into alliance with Bacardi Japan, supplier of world No. 1•
Jul 18: Launched Triangle Ginger Highball Lemonrum brand. Started sales of 90 items across 29 brands in October•
Jul 18: Launched CJ Oishii Makgoli Mango2011.
•
Sep 19: Launched TEA’S HI Earl Grey & Orange•Launched Bacardi Classic Cocktails Mojito, Japan’s first•Sep 19: Launched TEA’S HI Jasmine & Lychee
Mojito base that can be served with soda, on April 13 andachieved full-year target in three months. The target was¾We introduced following non-alcoholic RTD products:
revised to 60,000 cases, three times the initial figure.
•Jul 4: Sukkiri Kaju no ZERO Lemon¾ Various products under the above two brands contributed to sales•
Jul 4: Sukkiri Kaju no ZERO grapefruit
growth.
Non-alcoholic
RTD launched in
Jul-Sep

RTD introduced
in Jul-Sep

Shochu¾ Achieved year-over-year sales growth¾ Strong sales in singly-distilled Waramugi, Karariimo and Kokuimo¾ Kuroumesyu also contributed to rise in sales

Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

15/25

International Business (1)(billions of yen)

Results highlights
Year-over-year changes
While yen appreciation erased gains primarily in North
America, sales increased 35.5% YoY on the back of gains inlocal currency terms and the addition of Silver Springs
Citrus’s results. Operating income declined due to the impact
of expenses related to cultivating the Vietnamese market.

2011 3Q

2012 3Q

Net sales

19.4

55
46.7
42.9

45

Key points in business plan: implementation status

OperatingincomeNorth America, others

1. North American business growth

Vietnam

0.5
1.2
(0.6)

234.6

210

198.3

2007

¾ Sales expanded on increased
investment in marketing of premium
brands• Sales growth higher than that for
total demand in Canada

182.6
180

163.3

165.2

2007

2008

150
2009

2010

2011

2012

SLEEMAN(CAN$ millions ）Sapporo USA(U.S.)

Sales in local currency (Jan-Sep)
40

37.0

36.1
33.0

39.1

¾ Expanding from the JapaneseAmerican market into wider U.S.
and Asian-American markets

40.9

32.6

Silver Springs Citrus (U.S.)

30

¾

20
2007

2008

2009
2010
USA（US$ millions）

2011

2012

Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

26.3

46.9

6.9

35.5%

2008

0.1
1.4
(1.3)

2009
2010
USA ($ millions)

2011

(0.4)
0.2
(0.7)

(74.9)%
19.2%−(Jan-Sep)

SLEEMAN (Canada)

204.9

%

41.9

35

Sales in local currency (Jan-Sep)
240

Amount59.9

6th straight year of year-on-year
volume growth!
Unit sales (YoY) 20112012
SLEEMAN
brand

107%

107%

approx approx.
Canada total
. 98%
103%
demand(Jan-Sep) YoY growth exceeding U.S. generaldemand for imported beer!

Unit sales (YoY)

2011

2012

Sapporo USA

105%

103%

approx.

approx.

102%

98%

Acquired a 51% stake in Silver Springs Citrus, thelargest U.S. market of private-brand chilled drinks U.S. general• Full-fledged entry into beverages business in demand for
the North American market
imported beer
• Started consolidation of profit/loss items
from April

16/25

International Business (2)Developments in South Korea

Key points in business plan: implementation status

2. Expansion in Asian market (incl. Oceania)
Developments in Vietnam¾ Full-fledged entry of locally-produced beer in the market
from end of February 2012
¾ Started full-scale marketing in the country including throughbillboards and TV commercials from April 2012
¾ Position Vietnam as the bridgehead and gradually expand into
ASEAN countries¾ We strengthened Sapporo brand value and sales structure in
South Korea by acquiring 15% sake in M’s Beverage Co., Ltd., awholly owned liquor sales subsidiary of Maeil Dairies Co., Ltd.
(which has top share in cheese, low-fat milk, and chilled coffee
drinks market), signing the agreement on Jan 31. A non-equity method
affiliate¾ 2011 sales: 230,000 cases (1 case = 350ml ×24 bottles) *Initial target: 300,000
cases (Though sales were affected for about two and a half months due to thedisaster, we achieved about 2/3 of the target.)¾ Sales targets: 380,000 cases in 2012,1.5 million cases in 2015 (1 case = 350ml
×24 bottles)¾ Aim to become the No.1 imported brand

Development in Oceania¾ In October 2011, we entered the Australian/New Zealandpremium beer market via a licensing agreement with Coopers
Brewery Ltd. (No. 3 in Australia’s beer market, No. 2 in premiumbeer market with a 17.3% share)¾ Full-fledged entry from 2012: aim to be the top Japanese beer brand¾ Sales targets: 160,000 cases in 2012, 500,000 in 2016 (1 case = 355ml
×24 bottles)

Developments in Singapore<Local outlet>¾ Expanding imported beer sales channels in local household market incooperation with POKKA Corporation¾ 2011 sales: approx. 80,000 cases (1 case = 355ml ×24 bottles) YoY 121.4%¾ Sales target: 150,000 cases in 2014 (1 case = 355ml ×24 bottles) *100,000
cases (large bottles).
¾ Aim to be the top Japanese beer brand.
Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

17/25

Food & Soft Drinks – Sapporo Beverage
Results highlights(billions of yen)

Sales volume declined to 92% of the previous year against a generaldemand rise to103%, partly due to the reversal of the surge indemand for Japanese drinking water following the disaster last year.*After retroactive
The decline in sales volume was accompanied by a decline inadjustment
operating income
Operating income margin (before goodwill amortization) was 4.3%. Net sales
Key points in business plan: implementation status

Strengthening/cultivation of competitive brands

OperatingincomeBefore GW
amortization

Year-over-year changes
2011 3Q

2012 3Q

Amount

%

*24.8

23.2

(1.5)

(6.4)%

1.0
1.5

0.2
0.9

(0.7)
(0.5)

(74.4)%(36.0)%¾ Concentrating investment on important categories and brands•Ribbon: -11% YoY growth⇒Raised brand recognition by airing a short animation of Ribbon-chanon TV from April.

Collaboration with other companies to bolster core brands⇒New launch of Yubari Melon Soda under the Ribbon brand in ¾ In April, re-launched Chosyoku Fruits, a productin collaboration with Kyodo Milk Industry Co., Ltd.
June.
¾
In March, launched Ribbon Napolin Ice, a⇒ New launch of Junsui Saratto Shiro budo under the Ribbon
product in collaboration with Akagi Nyugyo Co.,brand in August.
Ltd., in Hokkaido•Gabunomi: -13% YoY growth⇒Re-launched the product and carried out a promotion campaign with ¾ Presented to mass retailers a collaboration
campaign of Gabunomi and other products withfree gifts and a tie-up with a popular cartoon film to broaden sales
Kyodo Milk’s Homerun Bar
channels and enhance market penetration•Gerolsteiner: +13% YoY growth⇒Further promoting trials and building repeat customers

Synergies with POKKA Corporation¾ Other brands•Oishii Tansansui: +74%
Growth on the back of higher demand for alcohol consumption
at home⇒Continued focus
Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

¾ Synergies led to cost saving of ¥257 mn in Jan-Sep•Synergies from joint procurement and consigned production

18/25

Food & Soft Drinks – POKKA Group (1)Year-over-year changes(billions of yen)

Results highlights
New consolidation from April 2011 makes YoY comparisons meaningless,but comparisons based on reference figures below show that despite growth inDomestic Restaurants, overall sales declined reflecting the significant impact oflower Domestic Bev/Foods sales.
Operating income for the overall group declined due to the cost associatedwith the switch to common Sapporo Group palettes and increased sales
promotion costs in addition to the decline in sales of Domestic Bev/Food.

Before inter-segment eliminations
2011 3Q*2
2012 operating
income:Income before
deduction of
goodwill
amortization of ¥0.9
bn following
integration

Jan-Sep
2012

49.9

72.3

22.4

44.9%

1.7
2.6

(0.4)
0.9

(2.1)
(1.7)

―
(65.7)%Net sales
OperatingincomeBefore GW
amortization

Ref: Jan-Sep segment sales and operating income andYoY comparisons*1 2012 inter-segment
eliminations:¥0.6bn

Apr-Sep
2011*%*Started consolidating POKKA’s profit/loss items from 2011 2Q.

(billions of yen)2012 3Q

Year-over-year change
Amount%Domestic Bev/Food

55.0

54.1

(0.8)

(1.4)%

Overseas Bev/Food

7.5

7.6

0.0

4.3%

Domestic Restaurants

4.2

4.6

0.3

8.7%

Overseas Restaurants

3.4

3.5

0.0

7.3%

Other businesses

6.9

6.9

(0.0)

3.2%

POKKA Corporate

(4.0)

(3.9)

0.1

−

Sales (total)

73.2

72.9

(0.2)

(0.0)%

Operating income

2.2

0.5

(1.6)

−

Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

Amount

※1

※2

19/25

Food & Soft Drinks – POKKA Group (2)Key points in business plan: implementation status■ Beverage & Food Business (Japan): POKKA Corp. and six group vending machine operators
1. Beverages Business¾ Concentrating investments in core brands
・Kireto Lemon ‥Re-launch of spring , summer products, airing of
new commercials
・Aromax ・・Re-launched all products under the brand・Yasuragi Kibun no Corn-cha ・・Taking on the challenge of
nurturing a new category in the tea beverages market; commercial
being aired
2. Food Business¾ Focused on core and growth brands
・Jikkuri Kotokoto Kongaripan ‥Series completely
revamped
・Pokka Lemon 100 ‥Added new Lemonja designs
・Kantanbimi ‥ Expanded product lineup by launching
Korean seasonings
3. Started Working on Maintenance Plan for
Nagoya Plant¾ Construct new building on the site to manufacture
Pokka Lemon
・Correspond to the growth strategy for the corebusiness of Pokka Lemon 100
・The plant is to start operation in mid 2013
Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

Synergies with Sapporo Beverage¾ Synergies led to savings of about ¥190 mn in the
Jan-Sep period•Synergies from joint procurement andcommissioned manufacture

20/25

Food & Soft Drinks – POKKA Group (3)Key points in business plan: implementation status■ Beverage & Food Business (Overseas): POKKA Singapore
1. Expand into Singapore’s neighboring countries¾ Planning and implementing measures to activate markets inIndonesia and Malaysia
2. Bolster sales in existing markets¾ Strengthening alliances with agencies in Middle East andEuropeGreen Tea boasting the top share(about 70%) in green tea-based
beverages market in Singapore

Exporting products to 60
countries
POKKA ACE (M)
SDN. BHD.
(Malaysia)

POKKA CORPORATION(SINGAPORE)PTE LTD(Singapore)・■ Restaurants Business (Domestic): POKKA CREATE Co., Ltd.
1. Expanded sales via growth at existing stores,
introduction of new seasonal products¾ Outlets: 159 (99 in Kanto, 33 in Tokai, 22 in
Kansai, 5 in Kyushu; as of October 31, 2012)¾ Effectively using re-modeling plan
to strengthen brand image
2. Profits up on successful efforts
to lift profit ratio¾ Improved COSG ratio¾ Closed unprofitable restaurants■ Restaurants Business (Overseas)* POKKA CORPORATION(Hong Kong) and POKKA Food (Singapore) Pte. Ltd.
¾ Outlets: 41 in total (as of September 30, 2012)
・Kong Kong 30, Singapore 10, Macao 1¾ New outlets opened in Jan-Sep 2012

■ Other businesses
・Ice cream business
Foremost Blueseal brand (Okinawa)

・Hong Kong: Pokka Café 1, Mikichi 1,
Kurotaki (soba noodle restaurant) 1
・Singapore: Rive Gauche 1¾ Opened first company-run outlet in Naha, Okinawa
Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

21/25

Restaurants
Results highlights(billions of yen)

Year-over-year increase in sales in the Restaurant Business,
which was directly affected by the Great East Japan
Earthquake last year.
Sales for the Jan-Sep period increased 4.0% YoY at existing
stores. In addition to this, operating income improved YoY, on
closure of unprofitable outlets, cost reductions andNet sales
contributions from new outlets.
Key points in business plan: implementation status

OperatingincomeYear-over-year changes
2011 3Q

2012 3Q

Amount

17.8

19.3

1.4

7.9%

(0.0)

0.2

0.3

−

1. Positioning for growth
New restaurant opening strategy¾ Synergy with the Japanese Alcoholic Beverage Business:
Opening Yebisu Bar outlets•

Opened new mid-sized Ginza Lion
Opened new outlet in the Ueno Saigo Hall

¾ New business format•••

Ginza 3-chome,
Oshamanbe
pub/restaurant

In addition to two new outlets in Akasaka and Tokyo Station’s
Kurobei Yokocho, the format of the Osaki and Ginza 2-chomeoutlets was changed, increasing the number of Yebisu Bar outlets
to 9 as of the end of September.

¾ Ginza Lion chain expansion••

Ginza YEBISU BAR%

Opened the Kitchen Ginza Lion, a new outlet which specializes inroast beef
Opened Suruga Maru, a seafood and tempura rice bowl shop in a
highway rest area
Opened Ooi Hokkaido Oshamanbe Japanese pub/restaurant
serving seafood from Hokkaido
Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

¾ Total of 12 outlets opened from January throughSeptember 2012
• All outlets are performing as planned

2. Earnings structure reform¾ Locations closed in the Jan-Sep period: 9¾ Locations operating as of the end of September: 194
22/25

Real Estate (1)(billions of yen)

Year-over-year changes

Results highlights
Despite decline in real estate revenues, sales and income
rose from March onwards as we acquired 15% trust
beneficiary rights in Yebisu Garden Place. Maintaining
stable revenues despite high vacancy rates in Tokyo officeleasing market.
Key points in business plan: implementation status2011 3Q

2012 3Q

Amount%Net sales

16.6

17.3

0.7

4.4%

Operatingincome

6.4

7.1

0.7

11.6%

Occupancy rates are averages for January–September 2012

Site areas are taken from the land registry. Floor areas are as per building certification.

Boosting value of existing properties
Yebisu Garden Place¾ Maintain and improve occupancy rate and achieve
appropriate rent levels••

As of June 30)

Major rental properties inTokyo’s 23 wards

Site area(m 2)

Floor area(m 2)

Occupancy rate(%)

Yebisu Garden Place(1)56,943

298,00796%

40 floors aboveground, 5 below

Seiwa Yebisu Building*

2,617

10,400*59%

6 floors aboveground, 1 below

No. of floors

In March, we acquired the 15% trust beneficiary rights from Yebisu Square
7 floors aboveground, 1 below
1,561
9,126
92%
the joint holder needed for 100% ownership
Shibuya Sakuragaoka
10 floors aboveground, 1 below
1,200
9,268
100%
SquareMaintained high occupancy rates and rent levels as of the
10 floors aboveground, 4 below
530
4,232
96%
end of September at Yebisu Garden Place and other major Sapporo Ginza Building
Tokyo properties (table at right) compared to the 91%
13 floors aboveground, 1 below
Strata Ginza (2)1,117
11,41199%
average for office buildings in Tokyo’s 5 central wards*1. Figures are for entire property. Number of floors for office wings/buildings only. Occupancy rates are for office areasnly.
oRedevelopment of Ginza and Ebisu Areas¾ Redevelopment of Seiwa Yebisu Building•*2: Figures are for entire property. Sapporo owns 922m2 of the site (sectional ownership) and 89.72% of the building (joint
management)

For more details about our Real Estate business’s properties, visit the following website:(http:/www.yebisgup.jp/business/index.html)

Redevelopment (including expansion of floor area) has
started and will be completed in the fall of 2014
• Average occupancy steadily decreasing in line with therebuilding plan(*Average occupancy rate down to 59% from 77% in the same
period a year earlier)Seiwa Yebisu
Building(completed 1975)

Sapporo Ginza
Building(Completed 1970)¾ Redevelopment of Sapporo Ginza Building•

We started planning and negotiations with involved parties forredevelopment of Ginza 5-chome.
Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

23/25

Real Estate (2)Overview of Real Estate Business¾ Majority of the business’s operating income is from real estate leasing– Property portfolio largely comprises properties in Tokyo 5 central wards; see the previous slide– Unrealized gains on properties for lease as of the end of December 2011 was ¥126.5 billion.

¾ In January, we changed the trade name of Yebisu Garden Place Co., Ltd. to Sapporo Real Estate Co., Ltd.
to raise the Sapporo brand value and strengthen Group synergies.
Operating Income

Real estate leasing
Tokyo’s 23
wards
Other areas
Real estate leasing
total
Sales
Other operations*
Total* “Other operations” includes back-office operations

Jan-Sep 2011

Jan-Sep 2012

5.5
0.6
6.2
0.4
(0.2)
6.4

6.4
0.8
7.2
−
(0.1)
7.1

EBITDA

Real estate leasing
Tokyo’s 23
wards
Other areas
Real estate leasing
total
Sales
Other operations*
Total

Change(value)
0.8
0.1
1.0
(0.4)
0.1
0.7

(billions of yen)

FY2011

7.6
0.8
8.5
0.4
(0.3)
8.5

FY2012 est.

8.7
0.8
9.6
−
(0.3)
9.3

Change(value)
1.1
0.0
1.1
(0.4)
0.0
0.7

EBITDA = operating income + depreciation and amortization

Jan-Sep 2011

Jan-Sep 2012

8.0
1.2
9.2
0.4
(0.0)
9.7

9.1
1.3
10.4
−
0.1
10.6

Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

Change(value)
1.0
0.1
1.1
(0.4)
0.1
0.9

FY2011

11.0
1.5
12.6
0.4
(0.0)
12.9

FY2012 est.

12.3
1.5
13.8
−
0
13.9

Change(value)
1.2
(0.0)
1.2
(0.4)
0.1
0.9

24/25

To make people’s lives richer
and more enjoyable

The earnings forecasts and forward-looking statements appearing in this document were prepared by the
SAPPORO Group based on currently available information and its best assessment of potential risks anduncertainties. Actual outcomes may differ materially from forecasts due to changes in various underlying
factors.

Copyright, 2012SAPPORO HOLDINGS LTD. All rights reserved.

25/25