Financial Results
for the Six months ended June 30, 2023 — Consolidated(Based on IFRS)
August 10, 2023
Company name

Sapporo Holdings Limited

Security code
2501
Listed on
Tokyo Stock Exchange (Prime Market); Sapporo Securities Exchange
URL
https://www.sapporoholdings.jp/en/
Representative
Masaki Oga, President and Representative Director
Contact
Yosuke Nakamura, Director of the Corporate Planning Department
Telephone+81-3-5423-7407
Scheduled dates:
Filing of quarterly financial reportAugust 14, 2023
Commencement of dividend payments
Supplementary information to the quarterly earnings results
Available
Yes
Quarterly earnings results briefing held
(mainly targeted at institutional
investors and analysts)
1. Consolidated Financial Results for the six months ended June 30, 2023
(January 1 – June 30, 2023)(Amounts in million yen rounded to the nearest million yen)
(1) Operating Results(Percentage figures represent year-over-year changes)
Core Operating
Operating profit
ProfitprofitRevenuemillion yen%

Six months ended
June 30, 2023

million yen%

million yen

238,527

11.6

3,505

－

(2,810)－(5,105)－Six months ended
June 30, 2022

213,7887.1(2,155)

－

(241)

－

(375)

－

Profit attributable toowners of parent

Total comprehensive
incomemillion yen

million yen

%

%

%

million yen%

Basic earnings
per share

Diluted earnings
per share

Yen

Yen

Six months ended
June 30, 2023

(5,104)

－

7,663

20.9

(65.52)(65.52)Six months ended
June 30, 2022

(386)

－

6,339

(59.4)(4.96)(4.96)

Note: Profit before tax
Six months ended June 30, 2023
ሺ3,341) million yen
Six months ended June 30, 2022
758 million yen*Core operating profit is a proprietary profit indicator that measures the performance consistency of ourbusiness. Core operating profit is calculated as Revenue – Cost of sales – SG&A expenses.

－ 1 －(2) Financial Position

Total assets

Total equity

Equityattributable toowners of parent

million yen

million yen

million yen

Ratio ofequity attributableto owners of parent
to total assets%

Six months ended
June 30, 2023

644,540

171,572

170,671

26.5

Year ended
December 31, 2022

639,118

167,201

166,31026.0

2. Dividends
Dividend per share
Record date or period

End Q1End Q2End Q3Year-end

Full year

yen

yen

yen

yen

yen

Year ended December
31, 2022—

0.00

Year ending December
31, 2023—

0.00

Year ending December
31, 2023 (forecast)
Note: Changes to the latest dividend forecast announced: None

—

42.00

42.00

—

45.00

45.00

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

million yen%

million yen%

490,000

2.4

13,50045.0

Operating profit
million%yen

Profit attributable

Basic

to

earnings perowners of parent

share

Profitmillionyen%

million
yen

%

yen

Year
ending

9,500

(6.0)

5,570

DecemberNote: Changes to the latest consolidated results forecast announced: None

－

2 －

1.0

5,500

0.9

70.61

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: None
(3) Number of shares issued and outstanding (common stock)1) Number of shares issued at end of period (treasury stock included):June 30, 2023: 78,794,298 shares
December 31, 2022: 78,794,298 shares
2) Number of shares held in treasury at end of period:
June 30, 2023: 894,512 shares
December 31, 2022: 896,678 shares

3) Average number of outstanding shares during the period:
Six months ended June 30, 2023: 77,898,687 shares
Six months ended June 30, 2022: 77,897,619 shares
Audit Status
The quarterly 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 “1. Analysis of Operating Results and Financial
Condition (4) Consolidated Earnings Forecast” on page 8.
Seasonal factors
The Group’s operating results are affected by substantial seasonal variation in demand in the Alcoholic
Beverages and Food & Soft Drinks businesses. Revenues consequently tend to be lower in the first quarter
than in the other three quarters.

－ 3 －1. Analysis of Operating Results and Financial Condition(1) Operating Results
In this second quarter consolidated accounting period (January 1 - June 30, 2023), lifestyle patterns of living with
COVID-19 penetrated society and economic activity continued to normalize as the impact of COVID-19 lessened. On theother hand, the uncertain outlook continues, with concerns over rising prices due to factors such as the situation in
Ukraine, the depreciation of the yen, and inflation from surging prices of raw materials and energy will lead to consumers
becoming more cautious with their spending.
Under these circumstances, the Sapporo Group will decisively implement structural reforms, aiming to realize ourgrowth strategy in the first year of our “Medium-Term Management Plan (2023-2026).”
Consolidated revenue overall increased compared to the previous first half. This was because of the recovery of ontrade beer sales and dining out demand for beer halls in Alcoholic Beverages, along with the inclusion of STONEBREWING CO., LLC (Stone) as a consolidated subsidiary at the end of August 2022, which both counteracted decreased
revenue following the transfer of the cafe business in April 2022 and the liquidation of a vending machine operator
subsidiary in November 2022 intended to shift management resources of Food & Soft Drinks to growth areas.
Consolidated core operating profit increased year-on-year amid the effects of increased revenue in the Japan Alcoholic
Beverages business and structural reforms in the Restaurants business and Japan Food & Soft Drinks business.
Summary in key figures
RevenueCore operating profit

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

Six months ended
June 30, 2023

238,527

3,505(2,810)(5,104)Six months ended
June 30, 2022

213,788(2,155)

(241)

(386)

11.6

－

－

－

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.
Results by segment are outlined below.
Alcoholic Beverages
Revenue increased year-on-year thanks to a steady recovery in the commercial-use products market, price revisions,strong sales in North America, and the addition of Stone Brewing Co., LLC to the Group at the end of August 2022.
Core operating profit 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 from the recovery in the on-trade market as well as
the effects of structural reforms of the Restaurants business.
Despite the year-on-year increase in core operating profit, operating profit decreased year-on-year due to impairment
losses associated with the resolution to dissolve an overseas subsidiary, which had been under consideration as a partof our business portfolio review.
■Revenue: ¥172.5 billion (up ¥26.3 billion, or 18.0% year on year)■Core operating profit: ¥5.0 billion (compared with a loss of ¥0.5 billion a year earlier)■Operating profit: ¥(1.2) billion (compared with a profit of ¥1.2 billion a year earlier)
Details of Alcoholic Beverages (Japan and Overseas) and Restaurants in the Alcoholic Beverages business were as
follows.
Japan
While the on-trade products market is in a recovery trend as economic activity continues to normalize as a result oflessened impact from COVID-19, the off-trade products market remained weak. As a result, total domestic demandfor beer and beer-type beverages was estimated to have been about 99% year-on-year.
－

4 －In this fiscal year, we are focusing more on strengthening beer and RTD (*) in anticipation of the liquor tax revisionin October 2023.
In this context, the Group’s total domestic sales volumes of beer and beer-type beverages was 101% of theprevious year’s level thanks to an increase of on-trade products. On the other hand, while impacted by the recovery
in the on-trade products market, strong sales continued for household use products, with the sales quantity of Black
Label cans at 100% year-on-year, and sales quantity for RTD canned beverages at 104% year-on-year.
Overseas
In Canada, COVID-19 countermeasures have spurred an economic restart, and on-trade products market is in a
year-on-year recovery trend, with total demand Beer-type beverages up year-on-year. On the other hand, in the UnitedStates there was a year-on-year decrease due to the impact of inflation and other factors.
In this context, sales volume of overseas beer brands exceeded that of the previous year thanks to a recovery of
the on-trade market in Canada and after including the sales of Stone in the United States. Additionally, sales volumeof Sapporo brand beer in the focus market of North America was strong at 104% of the previous first half’s level.
Also, a resolution to liquidate ANCHOR BREWING COMPANY, LLC (“Anchor”) was made in July 2023. Anchor
was positioned as subject to liquidation in the Medium-Term Management Plan due to its continued sluggish businessperformance. In the United States, which will become a growth driver, we are shifting resources by enacting decisive
structural reforms, and aim to achieve further growth centered on Sapporo brand beer by creating synergies with
Stone.
Restaurants
The recovery trend for the restaurant market is continuing as economic activity continues to normalize as a resultof lessened impact from COVID-19.
Amid this, due to price revisions and a recovery in the number of customers, the Sapporo Group’s Restaurants
business recorded existing store sales at 103% of 2019 levels, recovering to roughly the same level as before theoutbreak of the COVID-19 pandemic.
*: RTD, or ready-to-drink beverages, are pre-mixed, low-alcohol cocktail-like beverages that can be consumed as isimmediately after opening.
Food & Soft Drinks
Revenue declined year-on-year due to the impacts of reduced units in operations following the liquidation of a vending
machine operator subsidiary and divestment of the cafe business in April 2022. This was despite price revisions.
Core operating profit and operating profit both increased compared to the same period of the previous fiscal year,
despite increased raw material costs. The effect of price revisions and structural reforms contributed to this year-on-year
improvement.
■Revenue: ¥55.4 billion (down ¥2.1 billion, or 3.6% year on year)■Core operating profit: ¥0.5 billion (compared with a loss of ¥0.8 billion a year earlier)■Operating profit: ¥0.4 billion (compared with a loss of ¥0.3 billion a year earlier)
Food & Soft Drinks (Japan)
Although demand in the on-trade market and vending machines has been impacted by the "life of coping with
COVID-19" becoming more prevalent, overall domestic beverage demand is estimated to be around 98% that of theprevious year because of the recovery following the easing of pandemic restrictions.
Meanwhile, while sales value for Kireto Lemon, the main brand in our priority Lemon business, was 108% year-onyear, and 102% year-on-year for no-sugar-added tea made with selected domestic ingredients, due in part to theimpact of price revisions, it was 93% year-on-year for soft drinks overall due to factors such as the reduction in
operating units after the liquidation of a vending machine operator subsidiary.
Overseas Beverage
Domestic sales value in Singapore was 104% year-on-year amid robust sales primarily in the off-trade channel.
－ 5 －In addition, sales value in Malaysia, a focus area, was 110% year-on-year because we made progress withstrengthening our sales structure. The value of export sales mainly to the Middle East was also brisk, at 113% yearon-year.
Real Estate
Revenues increased year-on-year thanks to the effects of the opening of the remodeled Center Plaza at Yebisu
Garden Place, a large multi-purpose complex, in November 2022.
Core operating profit and operating profit declined year-on-year, despite the effects of increased revenue. This was
because of a declining office occupancy rate of Yebisu Garden Place caused by a downturn in market conditions andwork to update the HVAC facilities of the office tower started in 2022.
■Revenue: ¥10.6 billion (up ¥0.5 billion, or 4.9% year on year)■Core operating profit: ¥1.9 billion (down ¥0.6 billion, or 25.2% year on year)■Operating profit: ¥1.8 billion (down ¥0.5 billion, or 21.3% year on year)
The office leasing market in the Greater Tokyo area has yet to see a recovery in occupancy rates and average rent
levels since the beginning of the year.
Amid this, the Group’s Real Estate business saw the office occupancy rate of Yebisu Garden Place decline. On theother hand, there was a steady increase in total sales of Sapporo Factory due to sales growth from the concentration of
outdoor brands and strong performance of events and cinemas.

－

6 －(2) Consolidated Financial Condition
As of the end of this Q2 consolidated accounting period, the following were the change factors in the condition of assets,
liabilities and equity.
(Millions of yen)
Category

As of December 31, 2022

As of June 30, 2023

ChangeCurrent assets

179,431

162,401(17,031)

Non-current assets

459,687

482,139

22,452

Total assets

639,118

644,540

5,421

Current Liabilities

219,515

183,206(36,309)

Non-current liabilities

252,402289,761

37,359Total liabilities

471,917472,967

1,050

Total equity

167,201

171,572

4,371

Total liabilities andequity639,118

644,540

5,421

In end-Q2, assets increased by ¥5.4 billion to ¥644.5 billion relative to the previous fiscal yearend, due to increases infinancial assets (non-current) due to fluctuations in fair value and tangible fixed assets, which offset the decline in tradeand other receivables resulting from seasonal factors.
Consolidated total liabilities came to ¥473.0 billion, which was a increase of ¥1.1 billion as compared to the end of theprevious fiscal year, because of the increase in corporate bonds and borrowings (non-current) resulting from a bondissuance, which offset the decline in corporate bonds and borrowings (current).
On the same comparative basis, capital increased by ¥4.4 billion to ¥171.6 billion. Although there was a decrease inretained earnings stemming from the posting of quarterly losses attributable to parent company owners and the payment
of end-period dividends, there were increases in foreign currency translation adjustments on foreign operating entities,
and other capital components measured in fair value through other comprehensive income.

－ 7 －(3) Consolidated Cash FlowsAt end-Q2, cash and cash equivalents (hereinafter “cash”) increased by ¥2.0 billion (13%) to ¥17.4 billion, relative tothe previous consolidated fiscal year-end.
The components of Q2’s cash flow categories were as follows.
(Millions of yen)
Category

As of June 30, 2022 As of June 30,2023

ChangeCash flows from operating activities

5,499

24,56819,068Cash flows from investing activities(10,501)(8,946)

1,555

Free cash flow

(5,001)

15,622

20,623

Cash flows from financing activities

3,462(15,663)(19,125)

Effect of exchange rate change on cash and cash
equivalents

2,393

2,047

(345)

854

2,006

1,153

Cash and cash equivalents at beginning of period

17,36815,380(1,988)Cash and cash equivalents at end of period

18,222

17,386(835)

Net increase (decrease) in cash and cash equivalents(Cash flows from operating activities)
Operating activities provided net cash amounting to ¥24.6 billion (higher by ¥19.1 billion or 347% from the previous
fiscal year). This was mainly attributable to a ¥7.9 billion decrease in accrued alcohol tax and a ¥3.3 billion decreasein loss before income taxes, which offset the decrease in trade and other receivables of ¥15.4 billion, depreciation andamortization of ¥10.2 billion, and impairment losses of ¥5.6 billion.
(Cash flows from investing activities)
Cash used in investing activities was ¥8.9 billion (lower by ¥1.6 billion year-on-year). Although there was income of¥5.7 billion from the redemption of investment securities, the decline was due to outlays of ¥6.0 billion for acquisitionof tangible fixed assets, outlays of ¥5.4 billion for the acquisition of investment securities, and of ¥3.5 billion for
acquisition of investment real estate.
(Cash flows from financing activities)
Cash used for financing activities was ¥15.7 billion (year-ago income of ¥3.5 billion). The main outflows were a ¥32.0
billion decrease of commercial papers, a ¥6.0 billion decrease in short-term borrowings, and ¥5.0 billion in repaymentof long-term borrowings, which outweighed income of ¥20.0 billion from bond issuance and ¥13.0 billion in proceedsfrom long-term borrowings.

(4) Consolidated Earnings Forecast
The consolidated earnings forecast for the full fiscal year to December 31, 2023, is unchanged from the forecast
announced by the Company on February 15, 2023.
Additionally, we established the Group Strategy Committee in September of this year, with the purpose of discussing
the formulation of Group strategy scenarios aimed at enhancing corporate value over the medium- to long-term. This
Committee is composed of outside experts in addition to inside company directors.

－

8 －2. Consolidated Financial Statements(1) Consolidated Statement of Financial Position(Millions of yen)
As of December 31, 2022
AssetsCurrent assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other financial assets
Other current assets
Total current assets
Non-current assets
Property, plant and equipment
Investment property
Goodwill
Intangible assets
Investments accounted for using equity
methodOther financial assets
Retirement benefit asset
Other non-current assets
Deferred tax assets
Total non-current assets
Total assets－ 9 －As of June 30, 2023

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

17,386
82,631
50,8393,630
7,914
162,401

129,102
209,628
33,783
9,328

138,273
210,952
35,547
7,257

1,370

1,372

68,616
1,353
3,938
2,569
459,687
639,118

78,042
4,587
3,727
2,383
482,139644,540

(Millions of yen)
As of December 31, 2022
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
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

－

10 －

As of June 31, 2023

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

35,74549,2244,039
1,181
41,358
7,961
43,699183,206

155,369
17,47851,859
3,471
1,941
278
22,007
252,402471,917

183,791
19,74855,421
3,408
1,883
283
25,226
289,761
472,967

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

53,887
40,639(1,779)37,69040,234
170,671901
171,572644,540

(2) Consolidated Statement of Profit or Loss
(Millions of yen)Six months ended
June 30, 2022

Six months ended
June 30, 2023

Revenue
Cost of sales
Gross profit

213,788
152,145
61,643

238,527
168,173
70,354

Selling, general and administrative expenses
Other operating income
Other operating expenses
Operating loss

63,798
3,113
1,200
(241)

66,849358
6,672(2,810)Finance income
Finance costs
Share of profit of investments accounted forusing equity method
Profit (loss) before tax

1,721
759
38

1,051
1,616
34

758

(3,341)

Income tax expense
Loss

1,133
(375)

1,764
(5,105)

Loss attributable to
Owners of parent
Non-controlling interests
Loss

(386)
11
(375)

(5,104)(1)(5,105)

Basic loss per share
Diluted loss per share(4.96)(4.96)(65.52)(65.52)－ 11 －

(3) Consolidated Statement of Comprehensive Income(Millions of yen)Six months ended
June 30, 2022
Loss
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
or loss
Total other comprehensive income, net of tax
Comprehensive income
Comprehensive income attributable to
Owners of parent
Non-controlling interests
Comprehensive income

－

12 －

Six months ended
June 30, 2023

(375)

(5,105)

1,569

4,983

(1,117)
452

2,318
7,301

6,229

5,435

33
6,262

32
5,467

6,714
6,339

12,768
7,663

6,232
107
6,339

7,639
24
7,663

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

Balance as of January 1,
2022

Share
capitalCapitalsurplusTreasurysharesRetainedearnings

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

Loss

Exchange differenceson translation offoreign operations

Effective portion of
cash flow hedges

1,782

(15)

6,133

33

6,133

33

(386)

Other comprehensive
incomeComprehensive income-

Purchase of treasury
shares
Disposal of treasury
shares

-

(2)

0

3

Dividends
Share-based paymenttransactions
Transfer to retained
earnings
Total transactions withownersBalance as of June 30,
2022

(386)

(3,277)
7
(843)
-

7

1

(4,120)--53,88740,603(1,783)40,285

7,915

18

Other components of equity

Balance as of January 1,
2022

Total equity
attributable toowners ofparentNoncontrollinginterests

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

-

(386)

11

(375)

Loss
Other comprehensive
income1,569(1,117)

6,618

6,618

96

6,714

Comprehensive income

1,569(1,117)

6,618

6,232

107

6,339

-

(2)

-

(2)

-

3

-

3

-

(3,277)(1)(3,278)

-

7

-

7

Purchase of treasury
shares
Disposal of treasury
sharesDividends
Share-based paymenttransactions
Transfer to retained
earnings
Total transactions withownersBalance as of June 30,
2022

(274)

1,117

843

-

-

-

(274)

1,117

843

(3,269)(1)(3,270)24,608-32,541

165,533

864

166,397－ 13 －

(Millions of yen)
Other components of equity

Balance as of January 1, 2023

SharecapitalCapitalsurplusTreasurysharesRetainedearnings

53,88740,645(1,785)43,392Loss

Exchange differenceson translation offoreign operations
4,714

10

5,410

32

5,410

32

(5,104)

Other comprehensive income
Comprehensive income

Effective portion of
cash flow hedges

-

-

-

Purchase of treasury shares(5,104)(2)

Disposal of treasury shares

08Dividends(3,277)

Share-based paymenttransactions(6)

Transfer to retained earnings

2,679

Total transactions with owners

-

(6)

6

(598)

-

-

Balance as of June 30, 2023

53,887

40,639(1,779)37,69010,12442

Total equity
attributable toowners of parent

Noncontrollinginterests

Total equity

30,171

166,310891

167,201-(5,104)(1)(5,105)

Other components of equity
Financial assets
measured at fair value
Remeasurements ofthrough otherdefined benefit planscomprehensive
incomeBalance as of January 1, 2023

25,446-

Loss

Total othercomponentsof equity

Other comprehensive income

4,983

2,318

12,742

12,742

26

12,768Comprehensive income

4,983

2,318

12,742

7,639

24

7,663

-

(2)

-

(2)

-

8

-

8

-

(3,277)(14)(3,292)

-

(6)

-

(6)

Purchase of treasury shares

Dividends

Transfer to retained earnings(361)(2,318)(2,679)---Total transactions with owners(361)(2,318)(2,679)(3,277)(14)(3,292)

Balance as of June 30, 2023

30,068-40,234

170,671901

171,572－14 －(5) Consolidated Statement of Cash Flows(Millions of yen)Six months ended
June 30, 2022
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 for using equity
methodLoss (gain) on sale and retirement of property, plant andequipment, 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 or decrease in retirement benefit asset or liability
Other
SubtotalInterest and dividends received
Interest paid
Income taxes refund (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
Purchase of intangible assets
Purchase of investment securities
Proceeds from sale of investment securities
Proceeds from redemption of investment securities
Payments for loans receivableCollection of loans receivable
Other
Net cash provided by (used in) investing activities－ 15 －

Six months ended
June 30, 2023

758
10,359
403
(600)
754
(38)

(3,341)
10,227
5,585
(581)
1,098
(34)

(1,232)564

16,542(3,653)
2,946(11,099)(5,265)3,251
13,126636(731)(7,531)
5,499

15,417(1,871)(522)(7,867)(596)
5,890
23,971640(1,051)
1,008
24,568(4,483)
2,738(6,591)(673)(2,819)
576
－
(36)
46
742
(10,501)(5,972)71(3,508)(1,031)(5,433)
940
5,725
(20)
11
270
(8,946)

(Millions of yen)Six months ended
June 30, 2022
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
Proceeds from issuance of bonds
Redemption of bonds
Dividends paid
Repayments of lease liabilities
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

－

16 －

4,247
18,0006,500(11,041)－(10,026)(3,272)(2,416)
1,470
3,462
2,393
854
17,36818,222Six months ended
June 30, 2023

(5,958)(32,000)
13,000(5,020)20,000－(3,272)(2,382)(31)(15,663)
2,047
2,006
15,38017,386

(6) Notes on the Going-concern Assumption
Not applicable(7) Subsequent event
ANCHOR BREWING COMPANY, LLC (hereinafter referred to as “Anchor”), a 100% consolidated subsidiary of
Sapporo Holdings Limited (hereinafter referred to as the “Company”), resolved on July 11, 2023, to commence theAssignment for the Benefit of Creditors process (hereinafter referred to as the “ABC”). We also have approved Anchor’scommencement of the ABC at the Board of Directors meeting held on the same day.
1.Reasons for the Commencement of the ABC
In 2017, we implemented the acquisition of Anchor in order to expand our beer business in the US market.
However, Anchor was significantly affected by the impact of the novel coronavirus, and such impact was particularly
prolonged in the San Francisco area. As a result, Anchor’s sales have significantly decreased. Over the past several
years, we implemented a variety of measures to improve the business, such as releasing new products, productrenewals, and making brand investments. However, Anchor’s business performance continued to be sluggish. Since itwould be difficult to improve profitability in the medium to long term, Anchor decided to commence the ABC.
We launched our four-year plan, “medium-term management plan (2023-26),” this year and are working to increase
the corporate value through the twin pillars of “structural reforms and business growth.”
We will promptly dispose of businesses that we have classified as a business to be disposed of and resolutely
implement structural reforms. Meanwhile, in the US, which serves as a growth driver, we will aim to achieve further
growth centering on SAPPORO PREMIUM BEER by generating synergies with STONE BREWING CO., LLC, which
we acquired as a subsidiary in August last year.
2.Outline of the Subsidiary which will commence the ABC(1)Name
ANCHOR BREWING COMPANY, LLC(2)
Location
1705 Mariposa Street‚ San Francisco‚ California‚ USA
Job
Title/Nameof(3)
President/CEO, Masashi Minami
Representative
Descriptionof(4)
Beer manufacturing and sales
Businesses(5)
Capital Amount$106 million US(6)
Date of Incorporation
March 23, 1896
Equity Holders and(7)
SAPPORO U.S.A., INC. 100%
Percentage of Holding
CapitalThe Company owns all of the membership interests inrelationship
Anchor through SAPPORO U.S.A., INC.
One of SAPPORO U.S.A.’s employees serves as the
Anchor’s Relationship Personnel(8)
President/CEO of Anchor and four of SAPPORO U.S.A.’s
relationshipwith the Company
employees also serve as other officers/directors of Anchor.
Business
Not applicable.
relationship3.Schedule of the Commencement of the ABC(1)
Date of resolution by Anchor(2)
Date of resolution for the commencement of theABC by the member of Anchor(3)
Date of resolution of the Board of Directors of theCompany(4)Filing of the Certificate of Cancellation of Anchor

July 11, 2023 (US time)
July 11, 2023 (US time)
July 12, 2023 (Japan time)
Scheduled for July 2024

4.Losses Arising from the Commencement of the ABC
The amount of the losses due to the commencement of the ABC is expected to be approximately JPY6 billion, andsuch amount is expected to be recorded as other operating expenses, etc. for the year ending in December 2023.
JPY5.3 billion of the loss was recorded as other operating expenses in this second quarter.
5.Impact of the commencement on Operating Activities, etc.
The commencement will have no impact on the Sapporo Group's business activities.

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