Financial Results
for the Six Months Ended June 30, 2013 — Consolidated(Based on Japanese GAAP)
August 2, 2013

Company name

Sapporo Holdings Limited

Security code
Listings
URL

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

Representative
Contact

Tsutomu Kamijo, President, Representative Director and Group CEO
Tatsuya Komatsu, Director of the Corporate Communications Department

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

Filing of quarterly financial reportAugust 13, 2013

Commencement of dividend payments-

Supplementary information to the quarterly earnings results

AvailableYes(mainly targeted at institutional
investors and analysts)

Quarterly earnings results briefing held

1. Consolidated Financial Results for the Six Months Ended June 30, 2013
(January 1 – June 30, 2013)(Amounts in million yen rounded down to the nearest million yen)

(1) Operating Results(Percentage figures represent year-over-year changes)
Net sales

Operating income

Ordinary income

million yen

million yen%

million yen%

Six months ended
June 30, 2013

231,225

3.7

470

-

335

-

189

-

Six months ended
June 30, 2012

223,043

16.0(1,726)-(2,461)-(2,901)-

Note: Accumulated other comprehensive income
Six months ended June 30, 2013 9,264 million yen
Six months ended June 30, 2012 (558) million yen

Net income per
share

Diluted net income
per share

Yen

Yen

Six months ended
June 30, 2013

0.49

-

Six months ended
June 30, 2012(7.41)-

1%

Net income
million yen%

(2) Financial Position

Total assets

Net assets

Shareholders’equity ratio

Net assets per
sharemillion yen

million yen%

yenJune 30, 2013

601,112140,06222.8

350.34

December 31, 2012

597,636

134,94622.1

336.60Note: Shareholders’ equity
June 30, 2013:
136,759 million yen
December 31, 2012: 131,795 million yen

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

Full year

yen

yen

yen

yen

yen

Year ended
December 31, 2012

—

0.00

Year ending
December 31, 2013

—

0.00

—

Year ending
December 31, 2013
(forecast)

7.00

7.00

7.00

7.00

Note: No changes were made to dividend forecasts in thesix months ended June 30, 2013

3. Forecast of Consolidated Earnings for the Year Ending December 31, 2013
(January 1 – December 31, 2013)(Percentage figures represent year-over-year changes)
Net
Net sales

Operating income

Ordinary income

Net income

incomeper share

Year ending
December 31,
2013

million yen%

million yen%

million yen%

million yen%

yen

512,000

4.0

15,300

6.1

14,000

2.3

5,500

2.0

14.05

Note: No Changes have been made to earnings forecastssince the latest release.

4. Other*For details, see "2. Other" on page 11.
(1) Changes in significant subsidiaries during the six months ended June 30, 2013 : Yes*Changes affecting the status of significant subsidiaries (scope of consolidation)
Newly consolidated: -Newly excluded: Sapporo Beverage Co., Ltd.

2

(Note) Sapporo Beverage Co., Ltd. was absorbed by Pokka Sapporo Food & Beverage Ltd. via amerger conducted on January 1, 2013. Sapporo Beverage Co., Ltd. was dissolved and ceased to
be a subsidiary of the Company; while Pokka Sapporo Food & Beverage Ltd. became a subsidiary.
(2) Simplified accounting: Yes*Use of simplified accounting methods and/or accounting methods specific to quarterly consolidated
financial statements(3) Changes in accounting policy, changes in accounting estimates, and retrospective restatement
1) Changes in accordance with amendments to accounting standards etc.: None
2) Changes other than 1) above: None
3) Changes in accounting estimates: None
4) Retrospective restatement: None
Note: For details, see “2. Other” on page 11.
(4) Number of shares issued and outstanding (common stock)1) Number of shares issued at end of period (treasury stock included):June 30, 2013:
393,971,493 shares
December 31, 2012: 393,971,493 shares
2) Number of shares held in treasury at end of period:
June 30, 2013: 3,604,978 shares
December 31, 2012:
2,418,030 shares
3) Average number of outstanding shares during the period:
390,873,563 shares
391,564,686 shares

Six months ended June 30, 2013:
Six months ended June 30, 2012:*Quarterly review status
The quarterly financial results are not subject to quarterly reviews pursuant to the Financial
Instruments and Exchange Act. The quarterly review of the quarterly financial results hereinhad
not been completed as of the date of this document.
Appropriate Use of Earnings Forecasts and Other Important Information
This document contains projections and other forward-looking statements based on information
available to the Company as of the date of this document. Actual results may differ from thoseexpressed or implied by forward-looking statements due to various factors.

3

1. Analysis of Operating Results
Consolidated Financial Results for the Six Months ended June 30, 2013
In the first half of 2013 (January 1 – June 30), the Japanese economy continued to display
some positive signs of recovery, including a stock market rally fueled by growing
expectations for monetary easing. However, the consum er-spending environment remained
clouded in uncertaint y.
Amid this environment, the Sapporo Group saw a sharp increase in sales year over yearwith strong contributions from the International Business and Restaurants Business .
International Business results benefited from steady sales gains at Canadian subsidiary
SLEEMAN BREWERIES, Sapporo USA, and Sapporo Vietnam. The Restaurant businessposted sharply higher sales with a solid contribution from a year-over-year increase in sales
at existing outlets . Strong contributions also came from the inclusion of re sults from two
recently consolidated subsidiaries, with Pokka Ace (M) SDN. BHD. added in January 2013
to the Food & Soft Drinks Business, and Silver Springs Citrus, Inc., the largest US maker ofprivate-brand chilled drinks, consolidated as part of the International Business in April 2012.
Group operating income al so increased sharply year over year thanks to reductions inmarketing expense at the Japanese Alcoholic Beverage Business and the International
Business’ success in expanding sales in Canada, the United States and Vietnam.
As a result of the above factors , in the first half of 2013 the Sapporo Group posted
consolidated sales of ¥231.2 billion (up ¥8.1 billion or 4% year over year), operating incomeof ¥0.4 billion (compared with a ¥1.7 billion loss a year earli er), and ordinary income of ¥0. 3
billion (compared with a ¥2.4 billion loss a year earlier). The Group achieved a first -half net
income of ¥0.1 billion (compared with a ¥2. 9 billion loss a year earlier ).
The first quarter of 2013 marked the startup of operations at Pokka Sapporo Food &Beverage Ltd., the surviving entity following the merger of Pokka Corporation and Sapporo
Beverage Co., Ltd.

Segment information is outlined below. From the beginning of fiscal 2013, Sapporo
Logistics Systems Co., Ltd., which was previously included in the Japanese Alc oholic
Beverages segment, and Pokka Logistics Co., Ltd., which was previously included in the
Food & Soft Drinks segment, were reclassified to the Other segment. On July 1, 2013,
Pokka Logistics Co., Ltd., was dissolved following an absorption -type merger with Sapporo
Logistics Systems Co., Ltd.
In addition, Pokka Food (Singapore) Pte. Ltd. was moved from the Food & Soft Drinks
segment to the Restaurants segment , and on April 1, 2013, the company’s name waschanged to Sapporo Lion (Singapore) Pte. Ltd. To enable year-over-year comparisons in4this document, figures for the year -earlier period have been adjusted to reflect the new
segmentation.

Seasonal Factors
The Group’s operating results exhibit substantial seasonal variation because demand forthe products and services offered by the Japanese Alcoholic Beverages, International
Business, Food & Soft Drinks, and Restaurant businesses tends to be concentrated in thesummer months. Sales and profits consequently in the first quarter tend to be lower than in
the other three quarters.

Japanese Alcoholic Beverages
We estimate that total domestic demand for beer and beer -type beverages in the first halfof 2013 declined 1% year over year. Beer and happoshu sales volumes declined slightly,
while volume sales of new -genre beer slowed but continued to show year -over-year growth.
Under these market conditions, the Japanese Alcoholic Beverage business continued toinvest management resources in its core beer bra nds while striving to expand the Sapporo
fan base by energetically introducing new value proposals. The business also continued toestablish the foundations for growth of its nonalcoholic beer -taste beverages andready-to-drink (RTD)* cocktails and solidif ied its wine & western spirits business and its
Japanese shochu business. Through this diversification of our product offerings, we areendeavoring to raise the Sapporo brand value.
In the beer and beer-type beverages category, the business continued to promote theYebisu brand, launching the limited -volume version Kaori Hanayagu Yebisu in February andYebisu Premium Black in May. The new offerings contributed to a year -over-year increase insales of our Yebisu brand beers during the first half of the year. In the new -genre beer
category, we followed up the February launch of renewal versions of Mugi to Hop and Mugi
to Hop Black with the introduction of the limited -volume Mugi to Hop Red in April. These newofferings were favorably received by consumers. In June, we launched Goku Zero, theworld’s first beer-type beverage (New genre beer product ) with zero purine bodies toconsiderable acclaim , and sales of the product are ahead of targets. As a result, overall
demand for our beer in the first half of 2013 exceeded total market demand, while total sales
volume for beer-type beverages was in line with demand for the same period of the previous
fiscal year.
In the nonalcoholic beer category, we launched renewal versions of Sapporo Premium
Alcohol Free and Sapporo Premium Alcohol Free Black in February. A well -coordinated andsustained sales campaign, including TV commercials and in -store promotions, fueled sa les5

of the renewal versions and helped us increase sales volume in the nonalcoholic beer
category.
In the RTD category, we received favorable consumer response to several new offerings,
including the limited -volume Sapporo Otoko Ume Sour , a deliciously sa lty canned chuhai(shochu-based alcoholic beverage) developed in collaboration with Nobel Confectionary Co.,
Ltd., and introduced in April. Amid rising demand for our bottled RTDs, we released a bottled
version of Bacardi Mango Mojito in April as we contin ued to raise the Bacardi brandrecognition and build a larger fan base.
Among wine offerings, our core imported wine, Yellow Tail, came out with Yellow Tail Pink
Moscato in March, widening the brand’s appeal. Among domestic wines, our mainstay
domestic pr emium brand, Grand Polaire, continued to enjoy strong customer support.
Overall, first-half wine sales rose above the previous -year level.
Our western spirits business enjoyed rising sales volumes, thanks to strong contributions
from Bacardi products, inc luding the Bacardi Classic Cocktails Mojito.
The shochu business also posted strong year -over-year sales gains on continued brisk
sales of two blended shochus introduced in 2012 – Imo Shochu Kokuimo and Mugi Shochu
Koimugi.
Overall, the Japanese Alcoholic Beverage business posted sales of ¥120.5 billion, up¥0.1 billion or 0% year over year in the first half of 2013. The slight gain in sales combinedwith tighter cost controls, particularly with regard to marketing expenses, enabled thebusiness to post operating income of ¥0. 1 billion, as the business rebounded from an
operating loss of ¥2.6 billion a year ago.
* (RTD, or ready-to-drink, beverages are already-mixed, low-alcohol content cocktail-like beverages thatcan be consumed as is immediately after opening.

International Business
In North America, where the timing of a full -fledged economic recovery remains unclear,
we estimate that total demand in the beer market was largely unchanged year over year in
the first half of 2013. The Asian beer market, however, continues to grow steadily, supportedby the region’s fast -growing economies.
In this environment, our International Business segment continued marketing activities
targeting the premium beer market, where it has core strengths. Canadian subsidiary
SLEEMAN BREWERIES recorded a 3% year -over-year increase in unit sales (excluding
outsourced production of Sapporo brand products and sales of domestic brands), extending
its growth streak to a seventh year . Sapporo USA achieved a 5% year-over-year increase insales volumes of Sapporo brand beers. Silver Springs Citrus, added to the Sapporo Group6

via a 51% equity acquisition in January 2012, also steadily increased its sales volumes
during the first half of 2013.
The business in Vietnam continued the full-fledged marketing offensive began in April
2012 as part of its efforts to build market recognition for the Sapporo brand. These efforts
were rewarded with strong year -over-year sales gains in th e first half of 2013, with sales
particularly strong during the Tet (New Year’s holiday) sales campaign. In South Korea, ourlocal partner, Maeil Da iries’ subsidiary, in which we have a 15% equity stake, continued its
efforts to expand sales of Sapporo brand beers to the household and commercial markets inthat country. In Oceania, we continued to bolster sales via our brew ing and sales licensing
agreement with Australia’s Coopers Brewery, and in Singapore we worked with our local
subsidiary to expand sales channels in the local household market. Thanks to the efforts
outlined above, beer volume sales in Asia and other overseas markets outside North
America was 175% compared with the year -ago period.
As a result of the above activities, the International Business posted first -half sales of¥23.0 billion, up ¥7.0 billion, or 44%, year over year, supported by increased sales on
local-currency bases a t continuing operations and a full three-month contribution from Silver
Springs Citrus, which was consolidated in April 2012, and the positive impact of yen
depreciation. The segment posted operating income of ¥0.3 billion, reversing the ¥0.3 billion
loss posted in the first half of 2012.

Food & Soft Drinks
We estimate that domestic demand for soft drinks increased 3% year over year in the firsthalf of 2013, boosted by favorable weather conditions from April. Demand for lemon-based
products (flavorings) held steady with the previous -year level, while that for instant soup(including soups in a cup) declined an estimated 2%.
In this overall demand environment, the Sapporo Group’s Food & Soft Drinks businessbegan integrated operations in January as Pokka Sapporo Food & Beverage Ltd., and newinvestments were concentrated on core brands as the new subsidiary seeks to strengthen
and nurture its various brands.
In the domestic soft drinks business, we aggressively promoted sales of our canned
coffee brands with an emphasis on the vending machine sales channel, helping to increasedemand for our products. The business prepared for the peak demand seasons of springand summer by supplementing brand lineups with new offerings, such as Ribbon Yubari
Melon Soda. To raise awareness of the Gabunomi series among younger consumers andboost sales to that important de mographic, the business launched an integrated sales
promotion campaign utilizing advertising and in -store displays. In the lemon & natural foods

7

category, the business sought to penetrate the consumer market b y introducing a TVcommercial featuring its popular Kireto Lemon Sparkling beverage and releasing a renewed
version of its Oceanspray Cranberry juice beverage. With regard to overseas food & softdrink brands, the business steadily expanded sales of the Ge rolsteiner naturally carbonatedwater from Germany. In the soup & foods category, the business strengthened the productlineup for its Jikkuri Kotokoto series as part of our efforts to create new demand. In thecommercial-use products, we expanded o ur sales channels by introducing some products
for the universal design food market targeting elderly consumers and launching acommercial-use Pokka Lemon.

Despite the above efforts and a rebound in sales fromMarch, the segment’s domestic food & soft drinks ope rations saw its first -half sales decline
year over year as it was unable to offset the decline in sales in January and Februarycaused by merger preparations.
The segment’s Domestic Restaurants business fared better, as the Café de Crié coffee
shop chain, its core format, overcame an increasingly competitive operating environment,
including challenges from low -priced coffee served at major convenience store s and fast
food chains, by introducing new menu items on a regular basis and continuing to remodel
existing outlets and open new ones.
The overseas food & soft drinks business steadily lowered costs as it dealt with declining
exports caused by stiffening price competition in Singapore and the economic crisis in
Europe. Meanwhile, Pokka Ace (M) SDN. BHD. included in the Group’s consolidated resultsfrom January, contributed to Group earnings as it steadily expanded its business.
The segment’s overseas restaurant business saw its first-half results decline slightly, as it
continued to feel the effects of a market slowdown in Hong Kong caused by a decline invisits from mainland Chinese tourists.
Reflecting the results outlined above, in cluding the drop in sales at domestic food & softdrinks business caused by merger preparations, the Food & Soft Drinks segment recorded
first-half sales of ¥60.7 billion, up ¥1.2 billion or 2% year over year. However, businessintegration expenses weighed on the segment’s profits, resulting in a first -half operating lossof ¥2.4 billion (compared with a loss of ¥1.1 billion a year earlier).

8

Restaurants
Japan’s restaurant industry began to see some signs of improvement in consumer
sentiment amid growing expectations of a reviving economy in Japan in the first half of 2013.
However, in the absence of a full-fledged recovery, diversifying consumer values continue topresent restaurant operators with a difficult operating environment.
In this environment, t he Sapporo Group’s Restaurants business continued its efforts toprovide customers with pleasant and satisfying dining experiences by developing menu
offerings featuring regional specialties, thoroughly monitoring the quality of its draft beerofferings, and otherwise heightening service levels. Continued efforts to rejuvenate existingoutlets included renovating three outlets, including turning a dining bar on the second floorof the Ginza 7-chome outlet into a Beer & Wine Grill Ginza Lion establishment.
New outlet openings in the first half included YEBISU Bar outlets in Kyoto, the Sannomiya
district of Kobe and the Ochanomizu district of Tokyo. We also opened Ginza Lion outlets in
the Yebisu Garden Place complex, in Ochanomizu and inside the Tobu Utsunomiya
Department Store, where we also opened a rooftop beer garden.
In total, our Restaurants business opened nine new outlets during the first half of 2013
while closing 13 outlets, as part ongoing efforts to reform our profit structure, bringing
the total number of outlets operating at the end of the first half to 189.

In Singapore, Pokka Food (Singapore) Pte. Ltd. changed its name to Sapporo Lion(Singapore) Pte. Ltd on April 1, and the company is progressing with preparations to open
beer halls in the area.
Overall, the Sapporo Group’s Restaurants business recorded sales of ¥12.6 billion in thefirst half, up ¥0. 3 billion or 3% year over year, and an operating loss of ¥0.2 billion,
compared with a ¥0.3 billion loss a year earlier.

Real Estate
In Japan’s real estate industry, vacancy rates in the key Greater Tokyo office leasing
market are beginning to come down but rents remain at low levels.
Amid such market conditions, the Sappor o Group’s Real Estate business maintained highoccupancy rates at its properties in the Tokyo Metropolitan area, including its core property,
Yebisu Garden Place complex.
With Yebisu Garden Place set to mark 20 years of operation in 2014, a number of pro jects
got under way in 2012 that are designed to raise the property’s value and enhance its
branding and overall convenience . One of these projects, the installation of additional
emergency power-generating systems is proceeding on schedule for a completio n in spring9

2014. Efforts are being made to enhance the facility’s service and commercial functions forthe benefit of office workers and local residents. One related project completed in April was
the renovation of the cafeteria serving the district’s off ice workers.
The real estate development business began redevelopment in March of the Seiwa
Yebisu Building. Work on the building, expected to become a new base for the company in
the Ebisu district, is scheduled for completion in autumn 2014. We are also considering theredevelopment of the Sapporo Ginza Building located at the Ginza 4 -chome intersection
and have been engaged in consultations with the parties concerned.
As a result of the above, the Real Estate business’s first -half sales totaled ¥11.0 billion(¥0.2 billion, or 2%, less than a year earlier), while operating income amounted to ¥4.4
billion, essentially the same as a year earlier.

(2) Review of Consolidated Financial Condition
Consolidated financial condition
Consolidated assets as of the end of the first half of fiscal 2013 (June 30, 2013), totaled¥601.1 billion, a ¥3.4 billion increase from the end of the previous fiscal year (December 31,2012). The increase is att ributable to an increase in merchandise and finished products aswell as an increase in investment securities, which more than offset a decrease in notes andaccounts receivable -trade
Consolidated liabilities totaled ¥46 1.0 billion, a ¥1.6 billion decline from December 31, 2012,reflecting decreases in short-term bank loans and liquor taxes payable , which offset
increases in long -term bank loans.
Consolidated net assets totaled ¥1 40.0 billion, a ¥5.1 billion increase from December 31,
2012. The increase is largely attributable to increases in unrealized holding gains on
securities and in the foreign currency translation adjustment account , outweighing thedecline in retained earnings caused by the distribution of year -end dividends.

Consolidated Cash Fl ows
Consolidated cash flows for the six months ended June 30, 201 3, were as follows.
Operating activities provided net cash of ¥ 8.6 billion. Cash inflows from depreciation andamortization (¥12.5 billion) and a decrease in accounts receivable (¥8.5 billion) werepartially offset by outflows related to an increase in inventories (¥3.0 billion), a decrease inliquor taxes payable (¥1.9 billion), and income taxes paid (¥4.9 billion).
Investing activities used net cash of ¥ 4.6 billion. The major investment outflow during thesix-month period was for purchases of property, plant and equipment (¥ 5.8 billion).

10

Financing activities used net cash of ¥3.8 billion. The major financing inflow was proceedsfrom long-term bank loans (¥2 3.2 billion), which was exceeded by outflows stemming fromthe repayment of long -term bank loans (¥ 15.7 billion), a net decrease in short -term bankloans (¥7.2 billion) and cash dividends paid (¥2.7 billion).
As a result of the above cash flows, cash and cash equivalent s totaled ¥10.0 billion as ofJune 30, 201 3.

(3) Consolidated Earnings Forecast
The consolidated earnings forecast for the full fiscal year ending December 31, 2013, isunchanged from the forecast announced by the Company on February 8, 2013.

2. Other information(1) Changes in significant subsidiaries during the three months ended March 31, 2013
Sapporo Beverage Co., Ltd. was absorbed by Pokka Sapporo Food & Beverage Ltd. via amerger conducted on January 1, 2013. Sapporo Beverage Co., Ltd. was dissolv ed andceased to be a subsidiary of the Company; while Pokka Sapporo Food & Beverage Ltd.
became a subsidiary.

(2) Application of accounting methods specific to the preparation of quarterly
consolidated financial statements(Calculation of tax liabilities )The Company calculates tax liabilities by producing a reasonable estimate of the effective
tax rate after applying tax -effect accounting to income before taxes and minority interests forthe fiscal year, which encompasses the six months ended June 30, 2013, and thenmultiplying income (loss) before taxes and minority interests by this estimated effective tax
rate.

11

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

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

12

December 31, 2012

June 30, 2013

AmountAmount9,755
83,581
20,372
12,072
12,763(287)
138,258

10,06575,654
24,66812,386
13,066(227)
135,613384,995(205,155)
179,839
210,465(170,803)
39,661
115,413
4,425
39,242(25,520)
13,722353,061

387,094(208,501)
178,593
215,024(174,506)
40,518115,018
3,621
38,495(24,986)
13,509351,261

37,541
7,444
44,98536,2038,586
44,78935,6709,783
17,263(1,386)
61,330459,377
597,636

44,835
9,698
16,370(1,455)69,448465,499
601,112

Liabilities
I Current liabilities
1 Notes and accounts payable - trade
2 Short-term bank loans
3 Commercial Paper
4 Current portion of bonds
5 Liquor taxes payable
6 Income taxes payable
7 Accrued bonuses
8 Deposits received
9 Other
Total current liabilities
II Long-term liabilities
1 Bonds
2 Long-term bank loans
3 Employees' retirement benefits
4 Directors’ and audit & supervisory board members’
severance benefits
5 Dealers' deposits for guarantees
6 Other
Total long-term liabilities
Total liabilities
Net Assets
I Shareholders' equity
1 Common stock
2 Capital surplus
3 Retained earnings
4 Treasury stock, at cost
Total shareholders' equity
II Accumulated other comprehensive income
1 Unrealized holding gain on securities
2 Deferred hedge gains (losses)
3 Foreign currency translation adjustments
Total accumulated other comprehensive income
III Minority Interests
Total net assets
Total liabilities and net assets

13

December 31, 2012

June 30, 2013

AmountAmount32,98555,27047,00010,00033,3973,830
1,860
12,35846,443
243,146

33,186
46,11749,00031,5432,211
1,390
11,80745,156
220,41332,000113,376
7,385

42,000122,813
6,330

26

16

32,91433,840219,543
462,689

33,06936,405
240,636
461,050

53,88646,30831,393(1,199)130,389

53,88645,91028,077(1,226)
126,6485,122
9(3,725)
1,406
3,151
134,946597,636

11,134(4)(1,019)
10,1103,303
140,062
601,112(2) Consolidated Statements of Income(millions of yen)Six months ended June Six months ended June30, 2012
30, 2013
AmountAmount223,043
231,225
142,395
149,51580,64881,709I Net sales
II Cost of sales
Gross profit
III Selling, general and administrative expenses
1 Sales incentives and commissions
2 Advertising and promotion expenses
3 Salaries
4 Provision for bonuses
5 Retirement benefit expenses
6 Other
Total selling, general and administrative expenses
Operating income (loss)
IV Non-operating income
1 Interest income
2 Dividend income
3 Equity in income of affiliates
4 Foreign exchange gain
5 Gain on gift voucher redemptions
6 Other
Total non-operating income
V Non-operating expenses
1 Interest expense
2 Equity in loss of affiliates
3 Other
Total non-operating expenses
Ordinary income (loss)
VI Extraordinary gains
1 Gain on sales of property, plant and equipment
2 Gain on sales of investment securities
Total extraordinary gains
VII Extraordinary losses
1 Loss on disposal of property, plant and equipment
2 Impairment loss
3 Loss on devaluation of investment securities
4 Loss on sale of investment securities
5 Business structure improvement expenses
Total extraordinary losses
Income (loss) before income taxes and minority interests
Income taxes
Income (loss) before minority interests
Minority interests in losses
Net income (loss)

15,123
11,78615,173
1,078
1,759
37,45382,375(1,726)

15,24011,363
15,834773
1,690
36,337
81,239
470

132
368
58
94
246
520
1,419

129
523
470
685
1,810

1,733
420
2,154
(2,461)

1,426
3
514
1,944
335

6
16
23

42
3,491
3,533

272
34
1,180
1
1,489
(3,927)(880)(3,047)(145)(2,901)

248
288
11
3
185
737
3,132
2,982
149
(40)
189

(3,047)

149

2,009
(1)
462
18
2,489
(558)

6,011
(25)
3,128
9,115
9,264

(528)
(29)

8,893
371

-

Net income (loss) before minority interests
Other comprehensive income
Unrealized holding gain on securities
Deferred hedge gains (losses)
Foreign currency translation adjustments
Share of other comprehensive income of associates accounted for using equity method
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners of the parent
Comprehensive income attributable to minority interests14(3) Consolidated Statements of Cash Flows(millions of yen)(millions of yen)Six months ended June Six months ended June30, 2012
30, 2013
AmountAmountI Cash flows from operating activities
1 Income (loss) before income taxes and minority interests
2 Depreciation and amortization
3 Amortization of goodwill
4 Increase (decrease) in employees’ retirement benefits
5 Increase (decrease) in allowance for doubtful receivables
6 Interest and dividend income
7 Interest expense
8 (Gain) loss on sales and disposal of fixed assets
9 (Gain) loss on sales of investment securities
10 (Gain) loss on revaluation of investment securities
11 (Increase) decrease in notes and accounts receivable - trade
12 (Increase) decrease in inventories
13(Increase) decrease in other current assets
14 Increase (decrease) in notes and accounts payable - trade
15 Increase (decrease) in liquor taxes payable
16 Increase (decrease) in deposits received
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 property, plant and equipment
2 Proceeds from sales of property, plant and equipment
3 Purchases of intangibles
4 Purchases of investment securities
5 Proceeds from sales of Investment securities
6 Purchases of newly consolidated subsidiaries
7 Purchase of subsidiaries' shares
8 Purchase of affiliates securities
9 Other
Net cash provided by (used in) investing activities
III Cash flows from financing activities
1 Net increase (decrease) in short-term bank loans
2 Increase (decrease) in commercial paper
3 Issuance of bonds
4 Redemption of bonds
5 Proceeds from long-term bank loans
6 Repayment of long-term bank loans
7 Cash dividends paid
8 Cash devidends paid to minority shareholders
9 Repayment of finance lease obligations
10 OtherNet 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 Increase( decrease) in cash and cash equivalents from newly consolidated
subsidiaries
Ⅷ Cash and cash equivalents at end of period

15(3,927)
12,798
1,904
(49)
59
(501)
1,749
266
(15)
1,180
6,377
(5,404)442
2,773(2,279)(1,062)808
15,121655(1,763)(3,259)10,755

3,132
12,561
2,014
(979)
4
(653)
1,452
206
(3,488)11
8,538(3,066)(388)(58)(1,917)(663)(2,296)
14,408758(1,478)(4,997)
8,690(45,605)86(1,248)(109)
133(1,611)(0)(2,289)(50,643)(5,817)
94
(818)
(324)
4,339
(14)
(286)
(1,826)(4,653)

6,157
15,0009,960
20,999(8,859)(2,731)(1,974)(2)
38,54989(1,249)9,057(7,251)
2,000
9,960(10,000)
23,250(15,774)(2,729)(7)(2,371)(934)(3,859)
246
424
9,725

7,808

(116)
10,033

(4) Notes on the Going-concern Assumption
Not applicable(5)Segment Information
Ⅰ Six months ended June 30, 2012 (January 1, 2012 – June 30, 2012)
1. Sales, income, and loss by reportable segment(millions of yen)
Reportable segments
Japanese
Alcoholic
Beverages
Net sales(1) Operating revenues

Segment income (loss)

RealEstate

Total

Other *1

120,391

16,01059,51912,246

11,293

219,460

3,583

1,084

12

132

-

1,186

2,415

9,388

121,476

16,02259,652

12,246

12,479221,876

12,971(2,640)(350)(1,188)

(315)

4,440

(55)

(179)

(2) Intra-group sales and transfers
Total

International Food&
Restaurants
Soft Drinks

Total

223,043
11,803234,847(234)

Amounts
reported ontheAdjustments
statements
of income*2-

223,043(11,803)(11,803)

223,043(1,492)(1,726)-

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

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

AmountTotal for reportable segments(55)

Total other losses
Unallocated corporate costs(179)

Intra-segment sales
Operating income on the statement ofincome(1,505)13(1,726)

3. Impairment loss on fixed assets or goodwill by reportable segment(Significant impairment losses on fixed assets)
Not applicable(Significant change in the amount of goodwill)
Not applicable(Material Gain on negative goodwill)
Not applicable16

Ⅱ Six months ended June 30, 2013 (January 1, 2013 – June 30, 2013)
1. Sales, income, and loss by reportable segment(millions of yen)
Reportable segments
Japanese
Alcoholic
Beverages
Net sales(1) Operating revenues

Real
Estate

Total

Other *1

120,573

23,09060,751

12,603

11,014228,034

3,190

1,117

41

117

0

1,296

2,574

8,905

121,691

23,13260,86912,604

12,311

230,608

12,095199

337(2,451)

(225)

4,448

2,307

28

(2) Intra-group sales and transfers
Total

International Food&
Restaurants
Soft Drinks

Segment income (loss)

Total

231,225
11,479242,704
2,335

Amounts
reported ontheAdjustments
statements
of income*2-

231,225(11,479)(11,479)

231,225(1,865)470-

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

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

AmountTotal for reportable segments
Total other losses
Unallocated corporate costs
Intra-segment sales
Operating income on the statement ofincome2,307
28(1,726)(138)
470

3. Changes to reportable segments
The Sapporo Group conducted a reorganization of its logistics business on May 1, 2013. The Company’s consolidated subsidiaries Sapporo Logistics Systems
Co., Ltd. and Pokka Logistics Co., Ltd. were reorganized under Sapporo Group Logistics Co., Ltd., which is under the control of Sapporo Group Management
LTD.
In line with this, effective the three months ended March 31, 2013, Sapporo Logistics Systems Co., Ltd., which was previously included in the Japanese Alcoholic
Beverages segment, and Pokka Logistics Co., Ltd., which was previously included in the Food & Soft Drinks segment, were reclassified to the Other segment.
Additionally, effective the three months ended March 31, 2013, Pokka Food (Singapore) Pte. Ltd. which was previously included in the Food & Soft Drinks
segment was reclassified to the Restaurants segment in conjunction with changes in organizational structure through share transfers between consolidated
subsidiaries.
The segment information for the six months ended June 30, 2012 has been recast to reflect the change of segmentation.
(Note) On April 1, 2013, Pokka Food (Singapore) Pte. Ltd. changed its name to Sapporo Lion (Singapore) Pte. Ltd.
On July 1, 2013, Pokka Logistics Co., Ltd., will be dissolved following an absorption-type merger with Sapporo Logistics Systems Co., Ltd.

4. Impairment loss on fixed assets or goodwill by reportable segment(Significant impairment losses on fixed assets)
Not applicable(Significant changes in the amount of goodwill)
Not applicable(Material Gain on negative goodwill)
Not applicable(6)Notes on Significant Changes in the Amount of Shareholder's Equity
Not applicable(7)Subsequent Events
Not applicable17