Financial Results
for the Year Ended December 31, 2021 — Consolidated(Based on IFRS)
February 10, 2022
Company name

Sapporo Holdings Limited

Security code
2501
Listed on
Tokyo Stock Exchange (First Section); Sapporo Securities Exchange
URL
https://www.sapporoholdings.jp/en/
Representative
Masaki Oga, President and Representative Director
Contact
Tatsuya Komatsu, Director of the Corporate Planning Department
Telephone+81-3-5423-7407
Scheduled dates:
Annual general meeting of shareholders
March 30, 2022
Filing of annual financial report
March 31, 2022
Commencement of dividend payments
March 31, 2022
Supplementary information to the year-end earnings results
Available
Yes
Year-end earnings results briefing held
(mainly targeted at institutional
investors and analysts)

1. Consolidated Financial Results for the Year Ended December 31, 2021
(January 1 – December 31, 2021)(Amounts in million yen rounded to the nearest million yen)

(1) Operating Results(Percentage figures represent year-over-year changes)
RevenueCore operating profit

Operating profit

Profitmillion yen%

million yen%

million yen%

million yen

Year ended
December 31, 2021

437,159

0.6

8,142

91.1

22,029_12,275_

Year ended
December 31, 2020

434,723(11.6)

4,261(63.7)(15,938)_(16,605)_

Profit attributable toowners of parent
million yen

Year ended
December 31, 2021

12,331

Year ended
December 31, 2020

(16,071)%

Total comprehensive
incomemillion yen

_
_

%

%

17,127_(21,476)_

Basic earnings
per share

Diluted earnings
per share

Ratio of profit toequity attributableto owners of parent

Ratio of profit
before tax to total
assetsCore
operating profit
margin

%

%

%

yen

yen

Year ended
December 31, 2021

158.30155.82

7.9

3.5

1.9

Year ended
December 31, 2020

(206.31)(206.31)

(9.9)

(3.1)

1.0

- 1 -

Note: Equity method investment gains:
Year ended December 31, 2021: 47 million yen
Year ended December 31, 2020: 17 million yen
Profit (loss) before tax:
Year ended December 31, 2021: 21,185 million yen
Year ended December 31, 2020: (19,364) million yen
Operating profit margin:
Year ended December 31, 2021: 5.0%
Year ended December 31, 2020: (3.7)%
Note: Core Operating Profit is a proprietary profit indicator that measures the performance consistency of our business.
Core operating profit is calculated as Revenue – Cost of sales – SG&A expenses.
.

(2) Financial Position

Total assets

Total equity

Equityattributable toowners of parent

million yen

million yen

million yen

Ratio ofequity attributable toowners of parent tototal assets

Equity per share
attributable toowners of parent%

Yen

Year ended
December 31, 2021

594,551

163,327

162,57027.3

2,086.96

Year ended
December 31, 2020

616,349

149,551

149,78124.3

1,922.80(3) Cash Flows
Cash flows fromoperatingactivities

Cash flows frominvesting activities

Cash flows fromfinancing activities

Cash and cash
equivalents at endof period

million yen

million yen

million yen

million yen

Year ended
December 31, 2021

30,30820,729(53,080)

17,368Year ended
December 31, 2020

16,466(16,000)

4,138

19,734

2. Dividends

Dividend per share
Record date or period

End
Q1

End
Q2

End
Q3

Yearend

Full
year

Total dividends
paid(full year)

Payout ratio(consolidated)

Dividends to equity
attributable toowners of parent(consolidated)

million yen

%

%

yen

yen

yen

yen

yen

Year ended December
31, 2020

—

0.00

—

42.00

42.00

3,277

—

2.0

Year ended December
31, 2021

—

0.00

—

42.00

42.00

3,277

26.5

2.1

Year ending December
31, 2022 (forecast)

—

0.00

—

42.00

42.00

- 2 -

65.4

3. Forecast of Consolidated Earnings for the Year Ending December 31, 2022
(January 1 – December 31, 2022)(Percentage figures represent year-over-year changes)Core
operating profit

RevenueYear ending
December31, 2022

Operating profit

Profit attributable toowners of parent

Profitmillion yen%

million yen%

million yen%

million yen%

478,700

9.5

10,000

22.8

7,300

(66.9)

5,000(59.3)

million yen
5,000

Basic
earnings
per share%yen(59.5)

64.19

Note: Earnings forecasts for the six months ending June 30, 2022 are omitted because the company manages
performance targets on a yearly basis.

4. Other(1) Changes to scope of consolidation: None
(2) Changes in accounting policy, changes in accounting estimates, and retrospective restatement
1) Changes in accounting policies required by IFRS: None
2) Changes other than 1) above: None
3) Changes in accounting estimates: Yes (Refer to P.20 Consolidated Financial Statements)(3) Number of shares issued and outstanding (common stock)1) Number of shares issued at end of period (treasury stock included):
December 31, 2021: 78,794,298 shares
December 31, 2020: 78,794,298 shares
2) Number of shares held in treasury at end of period:
December 31, 2021: 896,510 shares
December 31, 2020: 896,951 shares
3) Average number of outstanding share during the period:
December 31, 2021:
77,898,067 shares
December 31, 2020:
77,897,530 shares
Audit Status
The year-end financial results are outside the scope of audit procedures based on the Financial Instruments
and Exchange Act.
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 those expressed or implied byforward-looking statements due to various factors. For the assumptions underlying the forecasts herein andother information on the use of earnings forecasts, refer to “Outlook for fiscal year ending December 31,2022” on page 9.

- 3 -1. Analysis of Operating Results and Financial Condition(1) Analysis of Operating Results(a) Review of the fiscal year ended December 31, 2021
Core operating
profitRevenueYear ended
December 31, 2021
Year ended
December 31, 2020

Millions of yen, except percentages
Profit attributable
Operating profit
to owners ofparent437,159

8,142

22,02912,331

434,723

4,261(15,938)(16,071)

0.6

91.1

－

－

Change (%)*Core operating profit is the Sapporo Group’s unique profit benchmark for measuring the performance of its regularbusiness and is calculated by deducting cost of sales, and selling, general and administrative expenses, from revenue.

In 2021, the Sapporo Group was impacted by Japan’s repeated issuances of state of emergency due
to the COVID-19 pandemic and restrictions on the service of alcoholic beverages due to semi-state of
emergency measures, which caused sales of commercial-use beer and sales to restaurants such as
beer halls to decline from the previous year, despite a partial recovery after the lifting of restrictions
since October. Meanwhile, the sales volume of home-use products, such as canned Sapporo Draft
Beer Black Label, Yebisu brand beers, and Sapporo Gold Star, have increased compared to theprevious year and remained strong.
In overseas, sales volume of commercial-use beer rose against the backdrop of economic recovery
due to the lifting of curfew restrictions in the US, and Sapporo brand beer in the US reached a record
high sales volume.
Also, demand for lemon-based products increased in association with recent changes to people’s
lifestyles and rising health consciousness, and sales volumes of both Pokka Lemon 100 and Kireto
Lemon reached new record highs for the third consecutive year.
This has resulted in a revenue increase compared to the previous year, and core operating profit
increased from the previous year due to a curtailment in expenses from cost structure reforms.
Additionally, operating profit and profit attributable to owners of parent were up year on year due to thesale of investment properties.
(b) Results by reportable segment
Millions of yen, except percentages
RevenueCore operating profit

Operating profit

Year
Year
Year
Year
ended
ended Change ended
ended ChangeDec. 31, Dec. 31,(%)
Dec. 31, Dec. 31,
(%)
2020
2021
2020
2021
Alcoholic
Beverages
Food &
Soft Drinks
Real Estate

Year
ended
Dec. 31,2020

Year
ended ChangeDec. 31,(%)
2021

285,427

289,678

1.5

2,368

5,441

129.7

(4,861)

2,146－

125,861

125,453(0.3)(2,621)

712－(16,921)(3,386)－23,262

21,863(6.0)

10,8538,226(24.2)

11,892

29,254

146.0

- 4 -

Alcoholic Beverages
Japan
The commercial-use market in the country has been significantly impacted by the COVID-19
pandemic. Total demand in Japan for beer and beer-type beverages is estimated to have only reachedaround 95% of the year-earlier level.
Under such circumstances, the Sapporo Group is continuously proposing ways to make beer more
appealing and diversified, and our canned beer products have steadily grown. Sales of canned Sapporo
Draft Beer Black Label and Yebisu brand beers remained strong, with sales volumes at 110% and 102%of the previous year’s level, respectively. Additionally, in the new genre category, Sapporo Gold Star,
with a sales volume that stood at 116% of the previous year’s level, won three awards both in Japanand abroad and was highly successful. As a result of the above, total sales of beer and beer-type
beverages stood at 96% of the previous year’s level due to a decrease in sales volume of commercialuse products although sales volume of canned products increased.
In the low alcohol beer taste category, we launched Sapporo The DRAFTY in September and areworking to cultivate new markets.
In the RTD*1 category, sales of Sapporo Koime no Lemon Sour, a new product launched in March
2021, were strong, while sales of core collaborative RTD product Otoko Ume Sour were also steady,driving category revenue significantly higher year on year.
In the domestic wine category, Grande Polaire performed well in the home-use market. In the imported
wine category, Parra Jiménez rode the wave of expanding demand for organic products and saw steady
growth. In addition, we signed a new sales contract in Japan with the world-renowned Frenchwinemaker M. Chapoutier, and expanded our lineup of fine wines that embody premium value.
In the imported spirits category, sales of Dewar’s Scotch whisky were strong thanks in part to the
expansion in the home-use market.
Our Japanese liquor business also posted a year-on-year increase in revenue with sustained solid
sales of Kokuimo brand, Japan’s best-selling*2 blended imo shochu, as well as Koime no Lemon Sourno Moto.
Overseas
In the North American beer and beer-type beverage category, due to the impact of the COVID-19
pandemic, demand in the commercial-use market has remained low year on year. It is estimated that
although demand fell in Canada compared to the previous year, it is recovering in the United Statesand increased year on year.
Despite the decrease in sales volume for overseas brand beers from the previous year due to strategic
product changes by Sleeman Breweries, sales volume increased over the same period in the RTD
category which we are focusing on. Sales of Sapporo brand beer in the United States reached record
highs thanks to the recovery of the commercial-use market with the removal of operating restrictions
placed on restaurants in the United States, in addition to the success of strengthening efforts in thehome-use market.
Restaurants
The entire restaurant industry, including pub restaurants and izakaya, has been suffering substantial
impacts from the COVID-19 pandemic since 2020. In the Sapporo Group’s restaurant business, many
restaurants were closed or had shortened operating hours during the period of restricted sales ofalcoholic beverages. We continued to operate our stores even after the lifting of various restrictions,
implementing measures to prevent the further spread of COVID-19.
Amidst these challenges, we worked to bolster menus along with take-out and delivery products, close
unprofitable restaurants, and shift to a low-cost, low-operation business format, among other initiatives,
which improved the core operating loss from the previous year, although revenue decreased. As of the- 5 -end of December 2021, our restaurant business had 162 outlets.
As a result of the above factors, revenue in the Alcoholic Beverages segment in the current fiscal
year came to ¥289.7 billion (up ¥4.3 billion, or 1% year on year), while the segment posted a core
operating profit of ¥5.4 billion (up ¥3.1 billion, or 130% year-on-year) and an operating profit of ¥ 2.1
billion (loss of ¥4.9 billion in the previous fiscal year).
*1: RTD, or ready-to-drink beverages, are pre-mixed, low-alcohol cocktail-like beverages that can be
consumed as is immediately after opening.
*2: Based on lntage SRI market research on combined blended imo shochu sales in the supermarket,
convenience store, and direct sales channels from February 2020 through November 2021.
Food & Soft Drinks
Total demand in Japan for soft drinks is estimated to be 101% of the previous year’s level. In thedomestic soft drink business, sales of Kireto Lemon W lemon and Kireto lemon Citric Acid 2700 also
enjoyed in addition to bottled products, driven by expectations for the fatigue-reducing effects of citricacid, thus kireto lemon sales reached new record highs. As a result, although sales of lemon-based
soft drinks were strong at 115% of the previous year’s level, the total sales volume of soft drinks
remained on par with the previous year due to a decrease in vending machine sales.
In processed foods, sales volume of cold canned soups grew significantly by 127% over the previous
year’s level, celebrating its 25th anniversary of the Jikkuri KotoKotto series, which we are focusing on.
Among lemon-based products, Pokka Lemon continued performing well due to expanding household
demand, with sales volume exceeding 107% of the previous year's level, and Kireto Lemon similarly
had record sales. We have started to provide food education support to Albirex Niigata in order tointroduce the value that lemons have, such as maintaining health. In addition, in order to promote
domestic lemon production, the lemons we have grown in Osakikamijima Town have been harvested
for the first time. We will revitalize the lemon market through these efforts.
Plant-based milk products also saw an increase in sales volume to 109% of the previous year’s level,with our soymilk yogurt products contributing to this increase thanks to rising health consciousness. We
also worked to increase the value and understanding of soymilk yogurt products by releasing research
results on the superiority of immunologically active ingredients contained in soymilk yogurt.
Pokka Create Co., Ltd., which operates the Café de Crié coffee shop chain, saw revenue increase
year on year despite the ongoing impacts the cafe industry has experienced under the COVID-19
pandemic, although it has not recovered to pre-COVID levels.
As a result of the above factors, revenue in the Food & Soft Drinks segment in the current fiscal year
came to ¥ 125.5 billion (down ¥0.4 billion, or 0% year on year), while the segment posted a core
operating profit of ¥0.7 billion (loss of ¥2.6 billion in the previous fiscal year) and an operating loss of¥ 3.4 billion (loss of ¥16.9 billion in the previous fiscal year).
Real Estate
The office leasing market in the Greater Tokyo area is experiencing a downtrend in occupancy rate
and average rents.
In this market climate, the Real Estate business saw a drop in occupancy rates due to the departureof some tenants at properties owned mainly in the Greater Tokyo Area, including the Yebisu Garden
Place Tower, the business’ core source of earnings. On the other hand, we enhance asset efficiency bystrategically reconfiguring our property portfolio, including the sale of Ebisu First Square and equity
investments funds that own commercial facilities, etc. While commercial facilities have been impacted
by COVID-19, we are continuing to renovate the Yebisu Garden Place commercial building in
preparation for its reopening in 2022.

- 6 -As a result of the above, revenue in the Real Estate segment in the current fiscal year totaled ¥21.9
billion (down ¥1.4 billion, or 6% year on year), while the segment posted a core operating profit of ¥8.2
billion (down ¥2.6 billion, or 24% year on year) and an operating profit of ¥29.3 billion (up ¥17.4 billion,or 146% year on year).
(2) Consolidated Financial Condition(Millions of yen)
2020

2021

Increase (decrease)current assets

160,829

167,806

6,977

Non-current assets

455,520426,745(28,775)

Total assets

616,349594,551(21,798)

Current Liabilities

216,243

210,535(5,707)

Non-current liabilities

250,555

220,688(29,867)

Total liabilities

466,798431,224(35,575)

Total equity

149,551

163,327

13,777

Total liabilities and616,349594,551(21,798)
equityConsolidated assets as of the end of the fiscal year were ¥594.6 billion, ¥21.8 billion less that at theend of the previous fiscal year, mainly due to decreases in other current assets, investment real estate,
and property, plant and equipment, despite increases in trade and other receivables and inventories.
Consolidated total liabilities came to ¥431.2 billion, which was a decrease of ¥35.6 billion as comparedto the end of the previous fiscal year, because of the decrease in bonds and borrowings (current), bonds
and borrowings (non-current), and lease liabilities (non-current), notwithstanding an increase in income
taxes payable and other current liabilities.
Consolidated total equity stood at ¥163.3 billion, up ¥13.8 billion compared to the end of the previous
fiscal year, due to the posting of a net profit attributable to owners of parent and an increase in othercomponents of equity, notwithstanding the payment of year-end dividends.

- 7 -(3) Consolidated Cash Flows
Cash and cash equivalents (collectively “cash”) totaled ¥17.4 billion as of December 31, 2021, ¥2.4
billion or 12% less than at the end of the previous fiscal year (December 31, 2020).
(Millions of yen)
Increase
2020
2021(decrease)
Cash flows from operating activities

16,46630,308

13,842

Cash flows from investing activities(16,000)

20,72936,729466

51,03750,571

4,138(53,080)(57,218)

(86)

777

863

Net increase (decrease) in cash and cash equivalents

4,519(1,266)(5,785)

Cash and cash equivalents at beginning of period

15,215

19,734

4,519

Cash and cash equivalents included in assets ofdisposal groups classified as holdings for sale－

(1,100)(1,100)19,734

17,368(2,366)

Free cash flow
Cash flows from financial activities
Effect of exchange rate change on cash and cash
equivalents

Cash and cash equivalents at end of period(Cash flows from operating activities)
Operating activities provided net cash amounting to ¥30.3 billion, an increase of ¥13.8 billion or 84%
from the previous fiscal year. This was mainly due to the increase in depreciation and amortization of¥22.7 billion, income before tax of ¥21.2 billion, and impairment loss of ¥7.5 billion, which offset the¥21.7 billion gain on sales and retirement of property, plant and equipment, and intangible assets.
(Cash flows from investing activities)
Investing activities provided net cash of ¥20.7 billion, compared to ¥16.0 billion used in the previous
fiscal year. The main outflows were purchase of property, plant and equipment of ¥12.0 billion, andpurchase of investment property of ¥8.1 billion, while there was an inflow of ¥40.4 billion in proceedsfrom the sale of investment properties.
(Cash flows from financing activities)
Financial activities used net cash totaling ¥53.1 billion, compared to ¥4.1 billion net cash provided in
the previous fiscal year. The main outflows were a redemption of bonds of ¥30.0 billion, repayments oflong-term borrowings of ¥19.3 billion, which outweighed inflow of ¥6.5 billion in proceeds from longterm borrowings.
Cash Flow Indicators
December 31,
2020
Ratio of equity attributable to owners of parent tototal assets (%)
Ratio of equity attributable to owners of parent tototal assets based on market capitalization (%)

2021
24.3

27.3

25.2

28.6

Cash flow to interest-bearing debt (years)

18.2

8.3

Interest coverage ratio (times)

9.9

20.1

Ratio of equity attributable to owners of parent to total assets: Equity attributable to owners of parent
to total assets / Total assets- 8 -Ratio of equity attributable to owners of parent to total assets based on market capitalization: Market
capitalization / Total assets
Cash flow to interest-bearing debt: Interest-bearing debt / Cash flow
Interest coverage ratio: Cash flow / Interest expense
Notes:
1. Market capitalization is calculated based on the number of shares issued and outstanding,excluding treasury stock.
2. “Cash flow” is operating cash flow.
3. Of the debt carried on the consolidated balance sheet, interest-bearing debt is total debt on whichinterest is currently payable.
(4) Outlook for fiscal year ending December 31, 2022(a) Overall outlook
Core operating
profitRevenue

Millions of yen, except percentages
Profit attributable toOperating profit
owners of parent

2022 forecast

478,700

10,000

7,300

5,000

2021 results

437,159

8,142

22,02912,3319.5

22.8(66.9)(59.5)

Projected change (%)

In 2022, uncertainty is expected to remain in the market environment due to the impact of the newvariant (Omicron) of COVID-19 both in Japan and overseas. In Japan, the economy may stagnate
due to restrictions on the operating hours and capacity of restaurants, such as semi-state of
emergency measures to prevent the spread of infections. However, we expect the market
environment is expected to start recovering, with growth in demand for home-use products to stabilize
and demand for the restaurant business and commercial-use products recovering moderately,
assuming that additional vaccinations and oral medications become more widely available. At thesame time, with working from home and telecommuting taking root, demand for office space is also
expected to remain severe.
Amidst these circumstances, the Sapporo Group will continue to focus on enhancing its mainstay
brands and will center on strengthening the beer category as well as the RTD category, such as
through plans to build a new RTD manufacturing facility at the Sendai Brewery for alcoholic
beverages in Japan. For overseas alcoholic beverages, we aim to achieve further growth, mainly inNorth America.
We expect raw material prices to rise in the Alcoholic Beverages and Food & Soft Drinks segments,
but we will continue structural reforms centered on cost reductions to achieve elimination of deficits in
the restaurant business and growth in the food and soft drinks business, and in the real estatebusiness, we will work to improve the profitability of the entire Group by strategically enhancing value,
including long-term repairs.
Through the above efforts, we are forecasting an increase in both revenue and core operating profit
versus 2021 levels.
We forecast the operating profit and profit attributable to owners of parent to decrease due to thedownturn in sales of investment properties that occurred during the current year.

- 9 -(b) Outlook by reportable segment
Millions of yen, except percentages
RevenueCore operating profit

Operating profit

Year
Year
Year
Year
Year
endingYear end ending
endingended
ChangeChange ended
ChangeDec. 31,
Dec. 31, Dec. 31,
Dec. 31,
Dec. 31,(%)(%)
Dec. 31,
(%)
2022
2021
2022
2022
2021
2021
(forecast)(forecast)(forecast)
Alcoholic
Beverages
Food & Soft
DrinksReal Estate

289,678

333,700

15.2

5,441

9,500

74.6

2,146

8,600

300.7

125,453

124,200

(1.0)

712

1,700

138.7

(3,386)1,300－

21,86320,700

(5.3)

8,226

6,300

(23.4)

29,2544,700(83.9)

Alcoholic Beverages
Japan
We will continue to show the appeal of beer and challenge new markets, and push ahead to create
enthusiastic fans. We will promote growth in beer through pursuing premium value by building contact
points and structures that reach diverse personalities and appeals. For the categories of new-genre
beer, which can be easily enjoyed at home, and RTD, we will accelerate growth by concentrating on
major brands and pursuing reasonable value. In addition, we will proactively take on the challenge ofcreating new markets through such products as the low-alcohol beer taste product Sapporo The
DRAFTY and the non-alcoholic food with functional claims Sapporo LEMON’S FREE. We will also
advance cost structure reforms to further improve profitability.
Overseas
We will work to ensure market penetration of Sapporo Premium Beer and our premium brands, andimplement strategies that take into account the special characteristics of each geographical area. In
the United States, we will accelerate the growth of the Sapporo and Anchor brands, and improve theprofit structure by launching new products. In Canada, we will improve profitability by strengthening thepremium brand beers and RTDs of Sleeman Breweries, and through cost structure reforms.

Restaurants
To respond to the changing needs of society, we will accelerate our research of new business areas
and the development and expansion of highly profitable business categories. In addition, we willcontinue to work on structural reforms to reduce costs and strengthen profitability, such as negotiating
reductions in outlet rents and controlling labor costs through more efficient work styles and staffing
assignments.
Food & Soft Drinks
With H (Health) + ESG management as a concept, we will implement strategies that utilize our strengths
in each business.
In the domestic soft drink business, the TOCHI and CRAFT series, which uses domestically produced
ingredients, will be clearly positioned as a “social good drinks” (*1) to further strengthen sales from theperspective of production promotion and community support.
In the lemon-based food and soft drink business, we will promote expanded measures and applications
responding to a broad range of occasions for Pokka Lemon, and the unique health value of lemons,such as the fatigue-reducing effects of citric acid, for Kireto Lemon, and will aim to achieve a record
number of shipments for both products.
- 10 -

We will strive to expand demand for our mainstay Jikkuri Kotokoto series in processed foods by adding
more health value in addition to conventional preference value.
In the plant-based milk business, we will continue to respond to the growing market centered on soymilk
yogurt.
*1 Products with a positive impact on society
Real Estate
In the real estate business, we will continue to strengthen our competitiveness in both hardware andsoftware, and work to maintain and improve occupancy rates and rent levels in the properties we own.
For Yebisu Garden Place and Sapporo Factory, our core facilities, we aim to maintain and improve
profitability and to enhance the brand value of the entire area by improving convenience and providing
new functions and added value in order to meet the needs of diverse lifestyles and work styles. In
addition, we will promote urban development in Ebisu and Sapporo by strategically reconfiguring ourproperty portfolio to increase the value of the real estate business as a whole, and will continue working
to generate income in new business areas, such as equity investments in private funds.
(NOTE) The outlook for 2022 presented above contains forward-looking statements that are based on
information available when the materials were prepared and are subject to risks and uncertainties.
Actual performance may differ materially from the future outlook described for various reasons.
(5) Dividend Policy and Dividends for 2021 and 2022
The Company considers the appropriate return of profits to its shareholders as a fundamental aspectof management policy and has adopted a basic policy to undertake stable dividend payments taking into
consideration the Company’s performance and financial condition.
With regard to the level of dividends going forward, the Company will take into account the dividend
payout ratio and DOE* while working to enhance its corporate value under the “Group Management
Plan 2024”, announced in February 2020.
However, if profit attributable to owners of parent changes significantly because of an extraordinary
profit or loss stemming from special factors, the impact may be taken into consideration when deciding
the dividend.
Given the above policy and taking into consideration the operating results for the current term and the
management environment etc. going forward, the Company plans to pay a dividend of ¥42 per sharefor 2021. The Company’s Articles of Incorporation stipulate that interim dividends may also be
distributed, but we currently are distributing an annual dividend once a year. Decisions regarding thepayment of dividends from surplus profits are, in the case of the year-end distribution, approved at thegeneral meeting of shareholders, while the interim dividend, if any, is determined at the sole discretionof the Board of Directors.
We plan to pay an annual per-share dividend of ¥42 in 2022
* DOE (dividend on equity) = Amount of dividends / Amount of equity (i.e., total equity attributable toowners of parent)

2. Basic Approach to Selecting Accounting Standards
The Sapporo Group has voluntarily applied the International Financial Reporting Standards (IFRS) to
its consolidated accounts from the first quarter of 2018. This change in accounting standard is aimed at
facilitating international comparisons of Group financial information in the capital markets.

- 11 -

3. Consolidated Financial Statements(1) Consolidated Statement of Financial Position(Millions of yen)
December 31, 2020
AssetsCurrent assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other financial assets
Other current assets
Subtotal
Assets held for sale
Total current assets
Non-current assets
Property, plant and equipment
Investment property
Goodwill
Intangible assets
Investments accounted for using equity method
Other financial assets
Other non-current assets
Deferred tax assets
Total non-current assets
Total assets- 12 -

December 31, 2021

19,73484,47536,001
5,459
14,883
160,551278
160,829

17,36891,53039,178
3,985
5,627
157,687
10,119167,806

126,650
218,574
17,9209,023
446
69,9696,108
6,831
455,520
616,349

120,624
203,224
19,176
7,893
1,345
65,6504,682
4,151
426,745594,551

(Millions of yen)

Liabilities and equity
Liabilities
Current liabilities
Trade and other payables
Bonds and borrowings
Lease liabilities
Income taxes payable
Other financial liabilities
Provisions
Other current liabilities
Subtotal
Liabilities directly associated with assets held for sale
Total current liabilities
Non-current liabilities
Bonds and borrowings
Lease liabilities
Other financial liabilities
Retirement benefit liability
Provisions
Other non-current liabilities
Deferred tax liabilities
Total non-current liabilities
Total liabilities
EquityShare capital
Capital surplus
Treasury shares
Retained earnings
Other components of equity
Total equity attributable to owners of parent
Non-controlling interests
Total equity
Total liabilities and equity- 13 -

December 31, 2020

December 31, 2021

31,927
83,177
5,836
727
38,1206,031
50,424
216,243－
216,243

33,22861,163
4,712
5,577
37,575
7,704
54,458204,418
6,118
210,535

158,091
21,04645,344
3,965
2,694
138
19,277
250,555
466,798

136,936
17,25744,376
318
2,078
139
19,585
220,688431,224

53,88740,853(1,787)33,45923,370149,781(231)
149,551
616,349

53,88740,596(1,785)44,791
25,080
162,570
757
163,327594,551

(2) Consolidated Statement of Profit or Loss and Comprehensive Income
Consolidated Statement of Profit or Loss
(Millions of yen)
Year ended
December 31, 2020

Year ended
December 31, 2021

Revenue
Cost of sales
Gross profit

434,723
302,593
132,130

437,159
303,380
133,779

Selling, general and administrative expenses
Other operating income
Other operating expenses
Operating profit (loss)

127,869
3,656
23,855(15,938)

125,637
28,45014,56422,029Finance income
Finance costs
Share of profit of investments accounted forusing equity method
Profit (loss) before tax

982
4,425

1,606
2,496

17

47

(19,364)

21,185

Income tax expense
Profit (loss)(2,759)(16,605)

8,910
12,275

Profit attributable to
Owners of parent
Non-controlling interests
Profit (loss)(16,071)(533)(16,605)

12,331(56)
12,275

Basic earnings (loss) per share
Diluted earnings (loss) per share(206.31)(206.31)158.30155.82- 14 -

(3) Consolidated Statement of Comprehensive Income(Millions of yen)

Profit (loss)

Year ended
December 31, 2020

Year ended
December 31, 2021

(16,605)

12,275(5,051)

(980)

1,124

2,164

(3,927)

1,185

(973)

3,643

29

24

Other comprehensive income
Items that will not be reclassified to profit or loss
Net change in fair value of equity instruments
designated as measured at fair value throughother comprehensive income
Remeasurements of defined benefit plans
Total of items that will not be reclassified to profit
or loss
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign
operations
Effective portion of cash flow hedges
Total of items that may be reclassified to profit orloss
Total other comprehensive income, net of tax
Comprehensive income

(944)

3,667

(4,872)(21,476)

4,852
17,127

Comprehensive income attributable to
Owners of parent
Non-controlling interests
Comprehensive income(20,913)(563)(21,476)

17,128(1)
17,127- 15 -

(4) Consolidated Statement of Changes in Equity(Millions of yen)
Other components of equity

Balance as of January 1, 2020

SharecapitalCapitalsurplusTreasurysharesRetainedearnings

53,88740,958(1,792)

51,521

Profit (loss)

Exchange differenceson translation offoreign operations
(863)

(68)

(943)

29

(943)

29

1,286

-

-

(16,071)

Other comprehensive income
Comprehensive income--

Purchase of treasury shares-(16,071)(5)

Disposal of treasury shares

010Dividends(3,277)

Changes in ownershipinterest in subsidiaries(92)

Share-based remunerationtransactions
Transfer from othercomponents of equity toretained earnings(12)

Total transactions with owners
Balance as of December 31,
2020

-

(104)

5

(1,991)--53,88740,853(1,787)33,459(1,806)(40)

Other components of equity
Financial assets
measured at fair value
through othercomprehensive income
Balance as of January 1, 2020

Effective portionof cash flow
hedgesTotal equity
attributableto ownersof parent

Noncontrollinginterests

Total equity

29,497174,071454

174,524-(16,071)(533)(16,605)

Remeasuremen
ts of defined
benefit plans

Total othercomponents ofequity-30,428

Profit (loss)
Other comprehensive
income(5,051)

1,124(4,842)(4,842)(30)(4,872)Comprehensive income(5,051)

1,124(4,842)(20,913)(563)(21,476)

Purchase of treasury shares

-

(5)

-

(5)

Disposal of treasury shares

-

10

-

10

Dividends-(3,277)(10)(3,287)

Changes in ownershipinterest in subsidiaries

-

(92)

(111)

(203)

Share-based remunerationtransactions

-

(12)

-

(12)

Transfer from othercomponents of equity toretained earnings(162)(1,124)(1,286)---

Total transactions with owners(162)(1,124)(1,286)(3,377)(121)(3,498)

Balance as of December 31,
2020

25,215-23,370149,781(231)

149,551- 16 -

(Millions of yen)
Other components of equity

Balance as of January 1, 2021

SharecapitalCapitalsurplusTreasurysharesRetainedearnings

53,88740,853(1,787)33,459Profit (loss)

Exchange differenceson translation offoreign operations

Effective portion of
cash flow hedges(1,806)

(40)

3,588

24

3,588

24

12,331Other comprehensive
incomeComprehensive income--

Purchase of treasury shares(5)

Disposal of treasury shares

08Dividends(3,277)

Changes in ownershipinterest in subsidiaries
Share-based remunerationtransactions
Transfer from othercomponents of equity toretained earnings

(50)
(24)
2,096
(182)

Other
Total transactions with owners
Balance as of December 31,
2021

12,331

182

-

(257)

3

(998)

-

-

53,88740,596(1,785)44,791

1,782

(15)

Other components of equity

Balance as of January 1, 2021

Total equity
attributableto ownersof parent

Noncontrollinginterests

Total equity

23,370149,781(231)

149,551-

12,331(56)

12,275

Financial assets measured
at fair value through othercomprehensive income

Remeasurementsof defined benefit
plans

Total othercomponentsof equity

25,215-

Profit (loss)
Other comprehensive
income

(980)

2,164

4,797

4,797

55

4,852

Comprehensive income

(980)

2,164

4,797

17,128(1)

17,217Purchase of treasury shares

-

(5)

-

(5)

Disposal of treasury shares

-

8

-

8

Dividends-(3,277)(1)(3,278)Changes in ownershipinterest in subsidiaries

-

(50)

-

(50)

Share-based remunerationtransactions

-

(24)

-

(24)

(3,086)

(990)

990

-

-

-

-

-

Transfer from othercomponents of equity toretained earnings(922)(2,164)

Other
Total transactions with owners(922)(2,164)(3,086)(4,339)989(3,350)

Balance as of December 31,
2021

23,313-25,080

162,570

757

163,327- 17 -

(5) Consolidated Statement of Cash Flows(Millions of yen)

Cash flows from operating activities
Profit (loss) before tax
Depreciation and amortization
Impairment losses
Interest and dividend income
Interest expenses
Share of loss (profit) of investments accounted forusing equity method
Loss (gain) on sale and retirement of property, plantand equipment, and intangible assets
Decrease (increase) in trade and other receivables
Decrease (increase) in inventories
Increase (decrease) in trade and other payables
Increase (decrease) in accrued alcohol tax
Other
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchase of investment property
Proceeds from sale of investment property
Purchase of intangible assets
Purchase of investment securities
Proceeds from sale of investment securities
Payments for acquisition of subsidiaries due tochange in scope of consolidation
Payments for investments in capital
Purchase of shares of subsidiaries and associates
Payments for loans receivableCollection of loans receivable
Other
Net cash provided by (used in) investing activities- 18 -

Year ended
December 31, 2020

Year ended
December 31, 2021

(19,364)
26,202
14,161(973)
1,792

21,18522,660
7,533
(844)
1,634

(17)

(47)

(896)

(21,732)

9,628
132(2,005)(3,353)(2,393)
22,914979(1,664)(5,763)
16,466(6,487)(1,835)
1,128
2,139
5,544
30,878840(1,508)98
30,308(10,199)412(3,639)1,648(2,318)(2,546)
1,517(11,982)
1,448(8,082)40,418(1,210)(2,358)3,330－(2,737)

(297)
－
(75)
77
(580)
(16,000)(1,300)
(900)
(59)
131
4,030
20,729(Millions of yen)

Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings
Proceeds from issuance of bonds
Redemption of bonds
Dividends paid
Repayments of lease liabilities
Purchase of treasury shares
Other
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents included in assets ofdisposal groups classified as holdings for sale
Cash and cash equivalents at end of period- 19 -

Year ended
December 31, 2020

Year ended
December 31, 2021

422
20,800(17,322)30,000(20,013)(3,287)(6,466)
(5)
10
4,138

(852)
6,500
(19,331)－(30,008)(3,276)(6,115)(5)
8(53,080)

(86)

777

4,519
15,215(1,266)
19,734-(1,100)19,734

17,368

(6) Notes on the Going-concern Assumption
Not applicable(7) Changes in presentation(Consolidated statement of financial position)
Income taxes receivable, which was stated separately under Current assets in the fiscal year ended
December 31, 2020, is included under Other current assets in the fiscal year ended December 31, 2021,
due to its reduced materiality. Reclassifications have been made to the consolidated financial statements
for the fiscal year ended December 31, 2020, to reflect this change in presentation.
As a result, the ¥8,755 million Income taxes receivable under Current assets in the fiscal year ended
December 31, 2020, is reclassified as Other current assets.
Provisions, which was included in Other current liabilities and Other non-current liabilities under Current
liabilities and Non-current liabilities, respectively, in the fiscal year ended December 31, 2020, is statedseparately in the fiscal year ended December 31, 2021, due to its increased materiality. Reclassifications
have been made to the consolidated financial statements for the fiscal year ended December 31, 2020, toreflect this change in presentation.
As a result, the ¥56,456 million Other current liabilities under Current liabilities in the fiscal year ended
December 31, 2020, is reclassified as the ¥6,031 million Provisions and the ¥50,424 million Other current
liabilities. In addition, the ¥2,832 million Other non-current liabilities under Non-current liabilities in thefiscal year ended December 31, 2020, is reclassified as the ¥2,694 million Provisions and the ¥138 million
Other non-current liabilities.
(Consolidated statement of cash flows)
Proceeds from sale of investment properties, which was included in Proceeds from sale of property, plantand equipment under Cash flows from investing activities in the fiscal year ended December 31, 2020, isstated separately in the fiscal year ended December 31, 2021, due to its increased materiality.
Reclassifications have been made to the consolidated statement of cash flows for the fiscal year ended
December 31, 2020, to reflect this change in presentation.
As a result, the ¥2,060 million Proceeds from sale of property, plant and equipment under Cash flows
from investing activities of Consolidated statement of cash flows in the fiscal year ended December 31,
2020, is reclassified as the ¥412 million Proceeds from sale of property, plant and equipment and the¥1,648 million Proceeds from sale of investment properties.
Payments for investments in capital, which was included in Other under Cash flows from investing
activities in the fiscal year ended December 31, 2020, is stated separately in the fiscal year ended
December 31, 2021, due to its increased materiality. Reclassifications have been made to the consolidated
statement of cash flows for the fiscal year ended December 31, 2020, to reflect this change in presentation.
As a result, the ¥(877) million Other under Cash flows from investing activities of Consolidated statementof cash flows in the fiscal year ended December 31, 2020, is reclassified as the ¥(297) million Payments
for investments in capital and the ¥(580) million Other.
(Significant accounting principles)
The significant accounting policies applied in the Sapporo Group’s consolidated financial statements are
the same as those applied in the previous consolidated fiscal year.
(Significant accounting estimates and judgments involving estimates)
In preparing consolidated financial statements in accordance with IFRS (International Financial ReportingStandards), management is required to make judgments, estimates, and assumptions that affect theapplication of accounting policies and the amounts of assets, liabilities, revenues, and expenses. Actual
results may differ materially from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Changes in accounting- 20 -

estimates are recognized in the accounting period in which the estimate is revised and in future accounting
periods thereafter.
Significant accounting estimates and judgments involving estimates in the consolidated financial
statements are the same as those in the consolidated financial statements for the previous fiscal year.
However, the Sapporo Group assumes that the spread of some new COVID-19 infections (Omicron
variant) will affect its business activities and financial performance, and thus makes accounting estimatessuch as impairment tests for non-financial assets and the collectibility of deferred tax assets. Specifically,
we believe that with the emergence of new mutant strains of COVID-19, the market environment will turnto recovery trend thanks to the roll-out vaccinations although the impact of infectious diseases on theeconomy and consumption is expected to continue until the end of the next consolidated fiscal year.
Furthermore, while demand for home-use products has calmed down, it is assumed that demand forrestaurant business and commercial-use product will recover, albeit gradually. Future trends of economicor personal consumption may not recover as expected, and other factors may have a significant impact
on the consolidated financial statements for the following fiscal year and beyond, depending on future
developments.
(Changes in accounting estimates)
Property, plant and equipment
With the resolution to remove some of the existing facilities at the Sendai Brewery of consolidated
subsidiary Sapporo Breweries Limited in the current fiscal year, the useful life of the facilities to be removed
has been shortened and changed in future years.
Accordingly, operating profit and profit before tax for the current consolidated fiscal year decreased by¥91 million each, and operating profit and profit before tax for the next consolidated fiscal year are
expected to decrease by ¥1,096 million each, compared with the conventional method.

- 21 -

(8) Segment Information(a) Overview of reportable segments
The Company’s reportable segments are components of the Sapporo Group about which separate
financial information is available. These segments are subject to periodic examinations to enable theCompany’s board of directors to decide how to allocate resources and assess performance.
Under the Company, which is a pure holding company, Group companies carry out business activities
and formulate strategies for the products and services they offer and for the sales markets they cover.
The Group’s businesses are segmented mainly based on the products, services and sales markets ofGroup companies and their affiliate companies. The Company’s three reportable segments are
Alcoholic Beverages, Food & Soft Drinks, and Real Estate.
The Alcoholic Beverages segment produces and sells alcoholic beverages and operates restaurants
of various styles.
The Food & Soft Drinks segment produces and sells foods and soft drinks.
The Real Estate segment’s activities include leasing and development of real estate.
(b) Revenue, profit (or loss)(Millions of yen)
Years ended December 31, 2020 (January 1, 2020 – December 31, 2020)

Alcoholic
Beverages

Food &
Soft Drinks

Real Estate

To outside customers

285,427

125,861

23,262

172

434,723

Inter-segment revenue

12,361

755

2,642

1

15,758－(15,758)

297,788

126,616

25,904173

450,481(15,758)434,723(4,861)(16,921)

11,892(0)

9,890(6,048)(15,938)

Other *1

Total

Adjustment

Consolidated
total

Revenue

Total
Operating profit (loss)

434,723－(Millions of yen)
Years ended December 31, 2021 (January 1, 2021 – December 31, 2021)

Alcoholic
Beverages

Food &
Soft Drinks

Real Estate

289,029

125,453

21,863

Other *1

Total

Adjustment

Consolidated
total

Revenue
To outside customers
Inter-segment revenue
Total
Operating profit (loss)

166

437,159

437,159

13,009

950

2,406

0

16,365－(16,365)

302,687

126,403

24,269166

453,525(16,365)

437,159

2,146(3,386)29,25434

28,048(6,020)22,029－"Other" comprises businesses, such as health food business, etc., that are not included in reportablesegments. Adjustment included General corporate and intercompany eliminations.
General corporation are general administrative expenses that do not belong to the reporting segment.
(Subsequent Events)
None- 22 -