Financial Results
for the Year Ended December 31, 2022 — Consolidated(Based on IFRS)
February 15, 2023
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
Satoshi Funakoshi, Director of the Corporate Planning Department
Telephone+81-3-5423-7407
Scheduled dates:
Annual general meeting of shareholders
March 30, 2023
Filing of annual financial report
March 31, 2023
Commencement of dividend payments
March 31, 2023
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, 2022
(January 1 – December 31, 2022)(Amounts in million yen rounded to the nearest million yen)

(1) Operating Results(Percentage figures represent year-over-year changes)
Revenuemillion yen

Core operating profit%

Operating profit

Profitmillion yen%

million yen%

million yen%

Year ended
December 31, 2022

478,422

9.4

9,312

14.4

10,106(54.1)

5,515(55.1)

Year ended
December 31, 2021

437,159

0.6

8,142

91.1

22,029_12,275_

Profit attributable toTotal comprehensive

owners of parent

incomemillion yen%

million yen%

Year ended
December 31, 2022

5,450

(55.8)

7,103(58.5)

Year ended
December 31, 2021

12,331

17,127__

Basic earnings

Diluted earnings

per shareper share

yen

yen

Ratio of profit to

Ratio of profitCoreequity attributable

before tax to total

operating profit

to owners of parent

assetsmargin%%%Year ended
December 31, 2022

69.96

69.95

3.3

1.8

1.9

Year ended
December 31, 2021

158.30155.82

7.9

3.5

1.9

- 1 -

Note: Equity method investment gains:
Year ended December 31, 2022: 108 million yen
Year ended December 31, 2021: 47 million yen
Profit (loss) before tax:
Year ended December 31, 2022: 11,367 million yen
Year ended December 31, 2021: 21,185 million yen
Operating profit margin:
Year ended December 31, 2022: 2.1%
Year ended December 31, 2021: 5.0%
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

million yen

Ratio of

Equityattributable toowners of parent

million yen

equity attributable toowners of parent tototal assets

million yen

Equity per share
attributable toowners of parent%

Yen

Year ended
December 31, 2022

639,118

167,201

166,31026.0

2,134.98

Year ended
December 31, 2021

594,551

163,327

162,57027.3

2,086.96

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(3) Cash Flows

Year ended
December 31, 2022

7,814

(46,137)

36,465

15,380Year ended
December 31, 2021

30,30820,729(53,080)

17,368

2. Dividends

Dividend per share
Record date or period

End

End

End Year-end Full year

Q1

Q2

Q3

yen

yen

yen

Year ended December
31, 2021—

0.00

Year ended December
31, 2022—

Year ending December
31, 2023 (forecast)

—

Total
dividends paid
(full year)

Payout ratio(consolidated)

Dividends to equity
attributable toowners of parent(consolidated)

million yen

%

%

yen

yen

—

42.00

42.00

3,277

26.5

2.1

0.00

—

42.00

42.00

3,277

60.0

2.0

0.00

—

45.00

45.00

- 2 -

63.7

3. Forecast of Consolidated Earnings for the Year Ending December 31, 2023
(January 1 – December 31, 2023)(Percentage figures represent year-over-year changes)
Core

Revenue

operating profit

Operating profit

Profit attributable toProfitowners of parent

million yen%

million yen%

million yen%

million yen%

490,000

2.4

13,500

45.0

9,500

(6.0)

5,570

1.0

million yen

Basicearnings
per share

%

yen

0.9

70.61

Year ending
December

5,500

31, 2023

Note: Earnings forecasts for the six months ending June 30, 2023 are omitted because the company manages
performance targets on a yearly basis.

4. Other(1) Changes to scope of consolidation: Yes
New: Stone Brewing Co.,LLC(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: None
(3) Number of shares issued and outstanding (common stock)1) Number of shares issued at end of period (treasury stock included):
December 31, 2022: 78,794,298 shares
December 31, 2021: 78,794,298 shares
2) Number of shares held in treasury at end of period:
December 31, 2022: 896,678 shares
December 31, 2021: 896,510 shares
3) Average number of outstanding share during the period:
December 31, 2022:
77,897,725 shares
December 31, 2021:
77,898,067 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,
2023” on page 10.

- 3 -1. Analysis of Operating Results and Financial Condition(1) Operating Results
Review of the fiscal year ended December 31, 2022
・The Sapporo Group had been affected by the spread of COVID-19 in Japan and overseas since
the beginning of the year 2022. However, the lifting of restrictions on behavior led to year-on-yearincreases in Group on-trade beer sales and the sales of beer halls and other dining-out
establishments. On the other hand, the outlook remains uncertain, with concerns over rising prices
due to factors such as the situation in Ukraine, the rapid depreciation of the yen, and surging prices ofraw materials will lead to consumers becoming more cautious with their spending.
・In this context, despite a decrease in revenue from the Food & Soft Drinks and Real Estatebusinesses, overall revenue increased year-on-year. This was thanks to an increased revenue fromthe Alcoholic Beverages business due to factors such as a recovery in restaurant demand and strong
sales volumes in the United States.
・Overall core operating profits increased year-on-year, despite decreased profits from the Real
Estate business. This was thanks to the contribution of the Restaurants business and the Food & Soft
Drinks business to profit structure improvements.
・Operating profit decreased in reaction to the gain on sale of investment properties in the previous
year, among other factors while core operating profit improved.

Summary in key figures
Core operating
profitRevenueYear ended
December 31, 2022
Year ended
December 31, 2021
Change (%)

Millions of yen, except percentages
Profit attributable
Operating profit
to owners ofparent478,422

9,312

10,1065,450

437,159

8,142

22,02912,331

9.4

14.4(54.1)(55.8)*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.

Results by segment are outlined below.
Alcoholic Beverages
・Revenue increased year-on-year thanks to factors such as the recovery of the on-trade market, pricerevisions, strong off-trade market sales in the United States, and the addition of Stone Brewing Co.,
LLC (hereinafter “Stone”), which became a consolidated subsidiary at the end of August through theacquisition of 100% of its equity, to the Group.
・Core operating profit and operating profit both increased year-on-year, despite increased variable
costs due to factors such as increased raw material prices. This was thanks to the effects of increased
revenue as well as the effects of profit structure improvements of the Restaurants business.
■Revenue: ¥334.6 billion (up ¥45.0 billion, or 15.5% year on year)■Core operating profit: ¥7.7 billion (up ¥2.3 billion, or 42.1% year on year)■Operating profit: ¥8.9 billion (up ¥6.8 billion, or 315.0% year on year)
Details of Alcoholic Beverages (Japan and Overseas) and Restaurants in the Alcoholic Beverages
business were as follows.
- 4 -Japan・During the fiscal year ended December 31, 2022, on-trade market demand had temporarily
declined due to the subsequent waves of COVID-19. However, the impact on establishments thatserve alcohol was milder than that of restrictions on the serving of alcohol during the previous year's
declarations of state of emergency, etc. In addition, due in part to limited impact of price revisions
on reducing demand, total domestic demand for beer and beer-type beverages was estimated tohave been about 103% year-on-year.
・In this context, the Group’s total domestic sales volumes of beer and beer-like beverages was
103% year-on-year thanks to an increase in sales volume of on-trade products. Sales of RTDs (*)
remained strong, at 103% of the previous year's level.
Overseas
・COVID countermeasures promoted economic resumption and on-trade market demand was inrecovery mode over the previous year, but in the North American beer and beer-type beveragecategory, overall demand both in the U.S. and Canada was estimated to decrease year-on-year.
・In this context, sales of overseas beer brands exceeded that of the previous year thanks to arecovery of the on-trade market in Canada. As for sales of Sapporo brand beer, sales volumes in
the United States was 110% year-on-year, continuing the record highs from the previous year, thanks
to the recovery of the on-trade market in the United States, the success of strengthening efforts inthe off-trade market, and other factors.
・Further, the Group acquired 100% of Stone's equity at the end of August, making it a consolidated
subsidiary. This was done for a number of purposes. One was to secure a manufacturing base forfurther growing the Sapporo brand beer, particularly in the United States. Another was to expand
our Beer business by acquiring new brands.
Restaurants
・Demand remains unstable in the pub, restaurant, and izakaya industry due to the impact of COVID19. However, our Restaurants business has shifted to a gradual recovery since the lifting of operating
restrictions in April, though additional waves of COVID-19 and other factors do lead to demand
fluctuations. The deficit narrowed significantly from the previous fiscal year due to the contributionof structural reforms, such as the reduction of unprofitable restaurants, that have been implemented
in the Corona disaster.
*: RTD, or ready-to-drink beverages, are pre-mixed, low-alcohol cocktail-like beverages that can be
consumed as is immediately after opening.
Food & Soft Drinks
・Revenue decreased year-on-year due to factors such as the sell-off of the Cafe business, theliquidation of one suburban vending machine operator subsidiary, and decreased sales due to the
reduction of vending machines.
・Core operating profit and operating profit both increased year-on-year, despite increased raw material
costs. This was thanks to the contribution of improved profits due to profit structure improvements suchas the sell-off of the Cafe business the implementation of price revisions.
■Revenue: ¥122.9 billion (down ¥2.5 billion, or 2.0% year on year)■Core operating profit: ¥1.8 billion (up ¥1.1 billion, or 148.2% year on year)■Operating profit: ¥2.3 billion (compared with a loss of ¥3.4 billion a year earlier)- 5 -・Although COVID continues to have an impact, the on-trade market and vending machine demand
recovered thanks to the relaxation of restrictions, with total domestic beverage demand estimated to
be around 102% that of the previous year.
・ In this context, domestic beverage sales volume in Japan decreased due to the reduction of
unprofitable vending machines, falling to 98% of the previous year while lemon beverages performed
well thanks to consumers’ heightened health consciousness, with record shipments of Kireto Lemonfor the seventh consecutive year, etc.
・As for overseas, domestic revenue in Singapore increased to 103% year-on-year due to the looseningof the country’s COVID-19 pandemic restrictions. And, exports out of Singapore have also remained
strong, and revenue grew to 115% year-on-year.
・Furthermore, in April, we transferred all shares of Pokka Create Co. Ltd., which operates the Cafe deCrie coffee shop chain, to focus management resources on growth areas, particularly the growing
lemon business. In November, we liquidated its suburban vending machine operator subsidiary, Public
Vending Service, Ltd.
Real Estate・Revenue decreased year-on-year due to a number of factors, such as the sale of Ebisu First Squarein June of the previous fiscal year , as well as the impact of lower occupancy rates resulting from thereplacement of office air-conditioning systems at Yebisu Garden Place, which began in the current fiscal
year.
・Core operating profit decreased year-on-year due to the decrease in revenue.
・Operating profit decreased year-on-year in reaction to the gain on sale of Ebisu First Square in theprevious fiscal year, among other factors.
■Revenue: ¥20.7 billion (down ¥1.1 billion, or 5.2% year on year)■Core operating profit: ¥6.5 billion (down ¥1.8 billion, or 21.5% year on year)■Operating profit: ¥5.4 billion (down ¥23.8 billion, or 81.4% year on year)
・The office leasing market in the Greater Tokyo area has yet to see a recovery in occupancy rates andaverage rent levels since the beginning of the year.
・In this context, the Group’s Real Estate business saw the office occupancy ratio of its large multipurpose complex, Yebisu Garden Place, decline due to deteriorating market conditions, long-term
repairs of its HVAC system, and other factors. On the other hand, visitors and sales have been steadysince the opening of Center Plaza in November of the current fiscal year.

- 6 -(2) Consolidated Financial Condition
As of the end of the fiscal year consolidated accounting period, the following were the change factors
in the condition of assets, liabilities and equity.
(Millions of yen)
2021

2022

Increase (decrease)current assets

167,806

179,431

11,625

Non-current assets

426,745459,687

32,942

Total assets

594,551

639,118

44,568Current Liabilities

210,535

219,515

8,979

Non-current liabilities

220,688

252,40231,714

Total liabilities

431,224

471,917

40,694

Total equity

163,327

167,201

3,874

Total liabilities and594,551
639,118
44,568equityConsolidated assets as of the end of the fiscal year were ¥639.1 billion, ¥44.6 billion more that at theend of the previous consolidated fiscal year, mainly due to increases in goodwill and property, plant andequipment from the acquisition of Stone, despite a decrease in assets held for sale with the sale of aconsolidated subsidiary.
Consolidated total liabilities came to ¥471.9 billion, which was a increase of ¥40.7 billion as comparedto the end of the previous fiscal year, mainly due to the increase in bonds and borrowings (current),
and bonds and borrowings (non-current) resulting from syndicated loan borrowings, despite a decrease
in income taxes payable and liabilities directly related to assets held for sale with the sale of aconsolidated subsidiary.
Consolidated total equity stood at ¥167.2 billion, up ¥3.9 billion compared to the end of the previous
fiscal year, due to an increase in other components of equity resulting from foreign exchange rate
fluctuations, notwithstanding a decrease in retained earnings from the payment of year-end dividends.

- 7 -(3) Consolidated Cash Flows
Cash and cash equivalents (collectively “cash”) totaled ¥15.4 billion as of December 31, 2022, ¥2.0
billion or 11% less than at the end of the previous fiscal year.
The status of each cash flow and their factors for the fiscal year were as follows.
(Millions of yen)
Increase
2021
2022(decrease)
Cash flows from operating activities

30,308

7,814(22,493)

Cash flows from investing activities

20,729(46,137)(66,867)

Free cash flow

51,037(38,323)(89,360)

Cash flows from financial activities(53,080)

36,46589,546

777

(131)

(908)

Net increase (decrease) in cash and cash equivalents(1,266)(1,988)(722)

Cash and cash equivalents at beginning of period

19,734

17,368(2,366)

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

(1,100)－1,100

Cash and cash equivalents at end of period

17,36815,380(1,988)

Effect of exchange rate change on cash and cash
equivalents(Cash flows from operating activities)
Operating activities provided net cash amounting to ¥7.8 billion (lower by ¥22.5 billion or 74% fromthe previous fiscal year). This was mainly due to an increase in depreciation and amortization of ¥21.2
billion and income before tax of ¥11.4 billion, which offset a corporate income tax payment of ¥10.0
billion, an increase in assets and liabilities related to retirement benefits of ¥5.7 billion, and an increase
in inventories of ¥5.0 billion.
(Cash flows from investing activities)
Cash used in investing activities was ¥46.1 billion (compared to ¥20.7 billion provided in the previous
fiscal year). Although there was an income of ¥1.9 billion on the sale of tangible fixed assets, this wasdue to outlays of ¥22.6 billion for the acquisition of subsidiary shares with the change in the scope of
consolidation due to the acquisition of Stone, ¥12.7 billion for the acquisition of investment real estate,and ¥8.0 billion for the acquisition of tangible fixed assets.
(Cash flows from financing activities)
Cash provided by financial activities was ¥36.5 billion (compared to ¥53.1 billion used in the previous
fiscal year). Although ¥16.6 billion was expended for the repayment of long term borrowings, proceedsfrom long-term borrowings of syndicated loans were ¥50.0 billion.
Cash Flow Indicators
December 31,
2021
Ratio of equity attributable to owners of parent tototal assets (%)
Ratio of equity attributable to owners of parent tototal assets based on market capitalization (%)

2022
27.3

26.0

28.6

40.0

Cash flow to interest-bearing debt (years)

8.3

37.9

Interest coverage ratio (times)

20.1

4.5

- 8 -

Ratio of equity attributable to owners of parent to total assets: Equity attributable to owners of parent
to total assets / Total assets
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.

- 9 -(4) Outlook for fiscal year ending December 31, 2023
・In 2023, under the theme of “Beyond150 - New Growth Through Business Structure
Transformation -,” we will decisively implement structural reforms, aiming to realize our growthstrategy in the first year of our "Medium-Term Management Plan (2023-2026)."
・The outlook is expected to remain uncertain, with concerns over rising prices due to factors such as
the situation in Ukraine and surging prices of raw materials will lead to consumers becoming morecautious with their spending. However, demand for the Restaurants business and on-trade products
tends to continue to recover moderately, as the COVID-19 influence may be limited amidst thegrowing prevalence of "Living with COVID-19" lifestyle both domestically and internationally.
・Under these circumstances, the Sapporo Group will strengthen its profitability by decisively
implementing structural reforms and accelerating growth. We expect further raw material prices to risein the Alcoholic Beverages and Food & Soft Drinks segments, but will secure profits through structuralreforms, including cost reductions and a drastic shakeup of unprofitable businesses, in addition to
price revisions. As for the Real Estate business, we will improve profitability and asset efficiency overa long-term time horizon by transforming from a business entity focused on rentals to one thatcomprehensively enhances asset value. In addition, the overseas business will expand sales ofalcoholic beverages in North America and beverages overseas, making them growth drivers for the
Sapporo Group. Through these efforts, we will strive to improve the profitability of the entire Group.
・Through the above efforts, we are forecasting an increase in both revenue and core operating profit
versus 2022 levels.
・Although we forecast an increase in profit attributable to owners of parent, the operating profit isforecasted to decrease due to increased expenses to promote speedy structural reforms.
Overall outlook
Core operating
profitRevenue

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

2023 forecast

490,000

13,500

9,500

5,500

2022 results

478,422

9,312

10,106

5,450

2.4

45.0

(6.0)

0.9

Projected change (%)

Results by segment are outlined below.
Alcoholic Beverages
・Revenue will be boosted by an effect of newly consolidated Stone, recovery of the on-trade market,
and price revisions.
・Core operating profit and operating profit both estimated to increase year-on-year due to the effectof increased revenue and an improved product mix, despite increased variable costs due to factors
such as increased raw material prices.
■Revenue: ¥347.0 billion (up ¥12.4 billion, or 3.7% year on year)■Core operating profit: ¥13.4 billion (up ¥5.7 billion, or 73.6% year on year)■Operating profit: ¥12.3 billion (up ¥3.5 billion, or 38.9% year on year)
Details of Alcoholic Beverages (Japan and Overseas) and Restaurants in the Alcoholic Beverages
business were as follows.
Japan
・In the next fiscal year, we will focus more on strengthening beer and RTD in anticipation of theliquor tax revision in October 2023. Along with sales growth, efforts for RTD will be made by- 10 -

improving productivity through the operation of RTD facilities at the Sendai Brewery. Continuingfrom the current fiscal year, soaring raw material prices will have a strong impact on our domestic
alcoholic beverage performance, but we expect to offset this negative effect through pricerevisions and efforts to improve an product mix.
Overseas
・As for overseas alcoholic beverages, we create synergies with Stone as early as possible in the
United States, which is a growth driver, and must strengthen our profitability by working toward
sales growth of Sapporo brand beer and the establishment of production and logistics system. In
Canada, we anticipate a significant impact from rising costs, but aim to recover profitability bystrengthening the premium brand beers of Sleeman Breweries, and through cost structurereforms.
Restaurants
・The demand in the pub restaurant and izakaya industry will likely continue to be uncertain due tothe COVID-19 pandemic, yet a moderate turnaround will continue. Given such circumstances,
Restaurants business will further endeavor to improve profitability by shifting resources to key
business categories such as YEBISU BAR and GINZA LION to build a robust management
structure for a post-COVID world.
Food & Soft Drinks
・We estimate lower revenues due to a significant strategic reduction in SKUs, while forecastingsales growth in the lemon business and overseas beverages as well as further price revisions.
・Core operating profit and operating profit both estimated to increase year-on-year because of thecontribution of structural reform effects such as price revisions and reductions in selling and disposal
costs, despite increased raw material costs.
■Revenue: ¥121.0 billion (down ¥1.9 billion, or 1.6% year on year)■Core operating profit: ¥2.4 billion (up ¥0.6 billion, or 34.0% year on year)■Operating profit: ¥2.3 billion (down ¥0.0 billion, or 0.2% year on year)
Details of domestic food & soft drinks and overseas beverages categorized in Food & Soft Drinks are
as follows.
Food & Soft Drinks (Japan)
・We will accelerate our initiatives to concentrate resources on the growing lemon business in
2023. We expect further raw material prices to rise, but will strengthen our profitability byimplementing structural reforms through cost reductions, productivity improvement due to asignificant reduction in SKUs, and unprofitable businesses liquidation, in addition to pricerevisions.
Overseas Beverage・Overseas beverages will be affected by soaring raw material prices, but we will address this byrevising prices and taking other measures. We will aim to turn our overseas businesses into a
growth driver for the Group by strengthening our sales and marketing structure in countries andregions with growth potential, such as Malaysia and the Middle East, starting from Singapore.
Real Estate・Revenues are expected to increase due to the renovation and opening of the Center Plaza at
Yebisu Garden Place in November of the current fiscal year as well as increased equity investments
funds and other factors.
- 11 -

・We project that core operating profit will be lower due to the expenses related to the replacement ofoffice air-conditioning systems at Yebisu Garden Place and repair costs incurred during therenovation of HOTEL CLUBBY operated in Sapporo.
・Operating profit will increase mainly due to the impact of the asset reclassification.
■Revenue: ¥22.0 billion (up ¥1.3 billion, or 6.2% year on year)■Core operating profit: ¥5.9 billion (down ¥0.6 billion, or 9.3% year on year)■Operating profit: ¥6.3 billion (up ¥0.8 billion, or 15.3% year on year)
・We will build an asset turnover business model in the next fiscal year by enhancing the coreproperty value in the Ebisu and Sapporo areas and building community, while strengthening
competitiveness. We will work to transform from the revenue base focused on rentals to one thatcomprehensively enhances asset value over a long-term time horizon.
(5) Dividend Policy and Dividends for 2022 and 2023
The Company considers the appropriate return of profits to its shareholders as a fundamental aspect ofmanagement 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 strive to raise the level of dividends
in line with the increase in corporate value, based on a consolidated dividend payout ratio of 30% or more,with the current level as the minimum under the “Medium-Term Management Plan (2023-2026),”
announced in November 2022. However, if profit attributable to owners of parent changes significantly due
to extraordinary non-recurring factors, etc., the amount of dividends will be determined taking into accountthe impact of such fluctuations. Retained earnings will be used for operational and capital investments
contributing to the future growth of the corporate value.
Given the above policy and taking into consideration the operating results and the financial condition forthe current term, the Company will pay a dividend of ¥42 per share for 2022. The Company’s Articles ofIncorporation stipulate that interim dividends may also be distributed, but we currently are distributing anannual dividend once a year. Decisions regarding the payment of dividends from surplus profits are, in thecase of the year-end distribution, approved at the general meeting of shareholders, while the interim
dividend, if any, is determined at the sole discretion of the Board of Directors.
We plan to pay an annual per-share dividend of ¥45 in 2023, an increase of ¥3 per share over thecurrent fiscal year to further return profits to our shareholders.

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.

- 12 -

3. Consolidated Financial Statements(1) Consolidated Statement of Financial Position(Millions of yen)
December 31, 2021
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
Retirement benefit Asset
Other non-current assets
Deferred tax assets
Total non-current assets
Total assets- 13 -

December 31, 2022

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

15,38096,59347,5258,454
11,479179,431－
179,431

120,624
203,224
19,176
7,893
1,345
65,650
－
4,682
4,151
426,745594,551

129,102
209,628
33,7839,328
1,370
68,616
1,353
3,938
2,569
459,687
639,118

(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- 14 -

December 31, 2021

December 31, 2022

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

35,73086,524
3,825
890
32,9997,485
52,060219,515－
219,515

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

155,369
17,47851,859
3,471
1,941
278
22,007
252,402471,91753,88740,596(1,785)44,791
25,080
162,570
757
163,327594,551

53,88740,645
1,785)
43,39230,171
166,310891
167,201
639,118

(2) Consolidated Statement of Profit or Loss and Comprehensive Income
Consolidated Statement of Profit or Loss
(Millions of yen)
Year ended
December 31, 2021

Year ended
December 31, 2022

Revenue
Cost of sales
Gross profit

437,159
303,380
133,779

478,422
339,180
139,243

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

125,637
28,45014,56422,029129,9313,992
3,198
10,106

Finance income
Finance costs
Share of profit of investments accounted forusing equity method
Profit (loss) before tax

1,606
2,496

3,044
1,891

47

108

21,185

11,367

Income tax expense
Profit (loss)

8,910
12,275

5,852
5,515

Profit attributable to
Owners of parent
Non-controlling interests
Profit (loss)

12,331(56)
12,275

5,450
65
5,515

Basic earnings (loss) per share
Diluted earnings (loss) per share

158.30155.82

69.96
69.95

- 15 -

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

Profit (loss)

Year ended
December 31, 2021

Year ended
December 31, 2022

12,275

5,515

(980)

2,539

2,164

(3,977)

1,185(1,439)

3,643

3,002

24

25

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

3,667

3,027

4,852
17,127

1,588
7,103

Comprehensive income attributable to
Owners of parent
Non-controlling interests
Comprehensive income

17,128(1)
17,127

6,969
135
7,103

- 16 -

(4) Consolidated Statement of Changes in Equity(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 -

(Millions of yen)
Other components of equity

Balance as of January 1, 2022

SharecapitalCapitalsurplusTreasurysharesRetainedearnings

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

Profit (loss)

Exchange differenceson translation offoreign operations

Effective portion of
cash flow hedges

1,782

(15)

2,932

25

2,932

25

5,450

Other comprehensive
incomeComprehensive income--

Purchase of treasury shares(4)0

Disposal of treasury shares

3

Dividends(3,277)

Share-based remunerationtransactions
Transfer from othercomponents of equity toretained earnings

49(3,572)

Total transactions with owners
Balance as of December 31,
2022

5,450

-

49

(0)

(6,849)--53,88740,645(1,785)43,392

4,714

10

Other components of equity

Balance as of January 1, 2022

Total equity
attributableto ownersof parent

Noncontrollinginterests

Total equity

Financial assets measured
at fair value through othercomprehensive income

Remeasurementsof defined benefit
plans

Total othercomponentsof equity

23,313-25,080

162,570

757

163,327

-

5,450

65

5,515

Profit (loss)
Other comprehensive
income2,539(3,977)

1,519

1,519

69

1,588

Comprehensive income

2,539(3,977)

1,519

6,969

135

7,103

Purchase of treasury shares

-

(4)

-

(4)

Disposal of treasury shares

-

3

-

3

Dividends-(3,277)(1)(3,278)

Share-based remunerationtransactions

-

49

-

49

Transfer from othercomponents of equity toretained earnings

(406)

3,977

3,572

-

-

-

Total transactions with owners

(406)

3,977

3,572

(3,228)(1)(3,229)Balance as of December 31,
2022

25,446-30,171

166,310891

167,201- 18 -

(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
Increase (decrease) in Retirement benefit Asset andliability
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- 19 -

Year ended
December 31, 2021

Year ended
December 31, 2022

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

11,367
21,234
1,326(1,056)
1,886

(47)

(108)

(21,732)(749)(6,487)(1,835)
1,128
2,139

(2,862)(5,013)295(2,434)(313)(5,736)

5,858
30,878840(1,508)98
30,308282
18,431
1,066(1,725)(9,958)
7,814(11,982)
1,448(8,082)40,418(1,210)(2,358)3,330(8,040)
1,928(12,706)－(1,580)(4,187)1,140(2,737)(22,558)(1,300)
(900)
(59)
131
4,030
20,729

－
－
(48)
130
(216)
(46,137)(Millions of yen)

Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Net increase (decrease) in commercial papers
Proceeds from long-term borrowings
Repayments of long-term borrowings
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- 20 -

Year ended
December 31, 2021

Year ended
December 31, 2022

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

9,625
10,00050,000(16,563)(10,026)(3,277)(4,685)(4)
1,395
36,465777(131)(1,266)
19,734(1,988)17,368(1,100)－17,36815,380(6) Notes to Consolidated Financial Statements(Notes on the Going-concern Assumption)
Not applicable(Reporting entity)
Sapporo Holdings Limited (the "Company") is a stock company located in Japan. Both its registeredhead office and principal business address are located in Shibuya-ku, Tokyo. The Company's
consolidated financial statements, with a year-end date of December 31, 2022, consist of the Company
and its subsidiaries (collectively the "Group"), as well as the Company's interest in its affiliates. The
Group's business and key activities are described in (Segment Information).
(Basis of Creation)(a) Compliance with IFRSThe Group's consolidated financial statements are prepared in accordance with IFRS (International
Financial Reporting Standards). The Company has applied the provisions of Article 93 of the Regulation
since meeting the requirements of "Specified Company Complying with Designated International
Accounting Standards" as stipulated in Article 1-2 of the Regulation on Consolidated Financial
Statements.
(b) Basis of measurement
The Group's consolidated financial statements are prepared on the basis of acquisition cost, except
for financial instruments measured at fair value.
(c) Presentation currency
The Group's consolidated financial statements are presented in Japanese yen, the functional
currency of the Company, rounded to the nearest million yen.
(d) Change in presentation method(Consolidated statement of cash flows)
Increase or decrease in retirement benefit asset or liability, which was included in Other under Cashflows from operating activities in the fiscal year ended December 31, 2021, is stated separately in thefiscal year ended December 31, 2022, due to its increased materiality. Reclassifications have been
made to the consolidated statement of cash flows for the fiscal year ended December 31, 2021, toreflect this change in presentation.
As a result, the ¥5,544 million Other under Cash flows from operating activities of Consolidated
statement of cash flows in the fiscal year ended December 31, 2021, is reclassified as the ¥(313) million
Increase or decrease in retirement benefit asset or liability and the ¥5,858 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, management is required tomake judgments, estimates, and assumptions that affect the application of accounting policies and theamounts of assets, liabilities, revenues, and expenses. Actual results may differ materially from theseestimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Changes in accounting
estimates are recognized in the accounting period in which the estimate is revised and in futureaccounting periods thereafter.
Significant accounting estimates and judgments involving estimates in the consolidated financial
statements are the same as those used in the consolidated financial statements for the previous fiscal- 21 -

year. However, with the spread of "Living with COVID-19" lifestyle both domestically and internationally,
we assume that the future impact of infections will be limited. Accounting estimates, including
impairment testing of non-financial assets and recoverability of deferred tax assets, are prepared toreflect the COVID-19 re-spreading impact on business activities and performance deemed reasonable
today. Specifically, we factor in that the market environment will begin to recover as "Living with COVID19" lifestyle becomes more prevalent, thus supposing a gradual recovery in demand for Restaurants
business and on-trade products. Another future epidemic, for example, could have a significant impact
on the consolidated financial statements in the following fiscal year or later(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, 2021 (January 1, 2021 – December 31, 2021)

Alcoholic
Beverages

Food &
Soft Drinks

Real Estate

Adjustment

Consolidated
total

To outside customers

289,678

125,453

21,863

166

Inter-segment revenue

13,009

950

2,406

0

437,159－

437,159

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)22,029Other *1

Total

Revenue

Total
Operating profit (loss)(Millions of yen)
Years ended December 31, 2022 (January 1, 2022 – December 31, 2022)

Alcoholic
Beverages

Food &
Soft Drinks

Real Estate

To outside customers

334,644

122,914

20,724140

478,422－478,422

Inter-segment revenue

12,571

912

2,332

－

15,815(15,815)－

347,215

123,826

23,057140494,237(15,815)

478,422

8,908

2,270

5,442

18

16,638(6,531)

10,106

Other *1

Total

Adjustment

Consolidated
total

Revenue

Total
Operating profit (loss)- 22 -

"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- 23 -