Financial Results Digest for Q1 2017

Transcription

1 This material includes the comments and the reference data based on FY2017 Q1 Financial Results. Financial Results Digest for Q May 2017

2 Financial Results Highlights for Q All Businesses achieved YoY growth in revenue and core operating profit (excluding one-off cost for the acquisition of Central and Eastern Europe business) and decent starts above the targets. Alcohol Beverages : Results following targets due to achieving the continuous favorable results of New Genre and RTD low-alcohol beverages and streamlining the entire costs. Soft Drinks : Results above targets driven by sales increases of core brands, sales channel and product mix improvements and efficient advertising and promotion cost uses. Food : Results above targets driven by continuous favorable sales of core brands and reduction of advertising and promotion costs and manufacturing costs. Overseas : Results following targets due to firm results of Western Europe and Oceania businesses, mitigating shortfall of Southeast Asia business. (excluding negative JPY 2.2 billion related to the acquisition cost of Central and Eastern Europe business) Aiming at exceeding the interim and year-end targets by achieving the results above targets in existing businesses and adding a Central and Eastern Europe business result, which was consolidated in the end of March. * Summary of Statement of Profit or Loss Alcohol Beverages Business % % Soft Drinks Business % % Food Business % % Overseas Business % % Other Business/Adjustment % % Revenue % % Alcohol Beverages Business % % Soft Drinks Business % % Food Business % % Overseas Business * % % Other Business/Adjustment Core operating profit % % Core operating profit in Overseas Business includes one-off costs of Western Europe business (JPY 0.4 billion) and acquisiton related costs of Central and Eastern Europe business (JPY 2.2 billion) 1

3 Alcohol Beverages Business (Sales Volume of Beer-type) <Sales Volume> (Millions of cases) <Market Total> Jan. - Mar. YoY Beer % % -1~2% Happoshu - - 0% % -0~1% New Genre - - 6% % +0~1% Beer-type beverages Total - - 0% % -0~1% <Sales Volume by Brand> (Millions of cases) <Container Type> Q1 (3month ended March 31) Jan. - Mar. Inc./Dec. YoY YoY Super Dry Total % Bottle - 6% Style Free Total % Can - 1% Clear Asahi Total % Keg - 2% Market Total YoY decline from 0 to 1% in total volume due to the structural factors of beer industry, despite reinforced marketing activities centered on core brands and extension products by each company. Sales Volume of Asahi Breweries The total volume unchanged from the previous year and results following target achieved due to strong performance from New Genre products, despite a year-on-year volume decrease for Beer. <Beer> -2% decline in total volume due to downturn in reaction to The Dream launched last year, despite YoY growth of Asahi Super Dry driven by marketing activities related to 30 th anniversary. <Happoshu> The total volume unchanged from the previous year due to favorable results of Style Free (+1.5% YoY growth). <New Genre> +6% growth in total volume driven by favorable results of Clear Asahi brand (+7.3% YoY growth) due to new launch of Zeitaku Zero and renewed Clear Asahi and Prime Rich. 2

4 Alcohol Beverages Business (Revenue) <Revenue> 2016 Inc./Dec. YoY 2016 Inc./Dec. YoY Beer % % Happoshu % % New Genre % % Beer-type beverages total % % Whiskey and spirits % % Wine % % RTD low-alcohol beverages % % Shochu % % Other % % Other alcohol beverages total % % Non-alcohol beverages % % Other, contracted manufacture, etc % % Asahi Breweries Revenue % % Other / elimination in segment % % Corporate adjustment (IFRS adjustment) Revenue total % % Revenue of Other Alcohol Beverages +5.8% YoY growth in total, with substantial increase in sales of RTD (favorable results of Mogitate) and robust results of whiskey due to enhancement of the sales of Black Nikka brand. +2.0% YoY growth in revenue of Non-alcohol beverages mainly driven by aggressive advertising of renewed Dry Zero. Total results above target achieved due to favorable results of RTD and whiskey, despite wine finished below target. 3

5 Alcohol Beverages Business (Core Operating Profit) <Core Operating Profit> Beer-type - Increase in sales volume Change in Beer-type Other than beer-type beverages - increase in sales volume Cost reduction in manufacturing Cost increase in manufacturing Increase in sales promotion expenses Increase in other expenses (Increase in personnel expenses) (Decrease in depreciation) (Increase in sales equipment expenses) (Others) Asahi Breweries % % Other / elimination in segment % % Core Operating Profit % % Factors Contributing to Growth / Decline +1.8% YoY growth in total due to revenue increase of other than beer-type beverages and cost reduction, mitigating increase in other expenses due to increase in personnel expenses. Total results following target with revenue increase of other than beer-type beverages and cost reduction, despite the sales volume of beer-type below the target < Break down of main factors > Beer-type increase in sales volume ±0 (Beer 0.8, Happoshu ±0, New Genre +0.8) Other than beer-type beverages increase in sales volume +0.9 Cost reduction in manufacturing +1.1 (Raw materials +0.6, Utilities +0.2, Mix improvement of other than beer-type +0.2, and others) Cost increase in manufacturing -0.2 (Raw materials -0.1, and others) Increase in sales promotion expenses -0.2 (Advertisement +0.1, Promotion expenses -0.3) (Beer-type +0.2, others -0.4) 4

6 Soft Drinks Business (Sales Volume) <Sales Volume> (Millions of cases) <Market Total> Jan. - Mar. YoY Carbonated drinks % % +0~1% Fruit juice % % +7~8% Coffee % % -0~1% Tea % % +2~3% Mineral water % % -1~2% Lactic acid drinks * % % +7~8% Other drinks * % % +9~10% Sales Volume Total % % +1~2% * Lactic acid drinks includes Calpis brand and other lactic acid products, which was previously in Other drinks. Other drinks compiles the previous Functional, Other drinks and Sales of other company's products <Sales Volume by major brands> (Millions of cases) Q1 (3month ended March 31) Inc./Dec. YoY Mitsuya % Wilkinson % WONDA % Jurokucha % Oishii Mizu % Calpis % <Container Type> <Channel Type> Jan. - Mar. YoY Jan. - Mar. YoY Glass Bottle 6.8% Vending machines 1.0% PET Bottle total 7.7% Over-the-counter total 5.9% PET large size - 4.5% Convenience Store 17.4% PET small size 18.0% Supermarket 1.5% Can - 1.1% Others 4.2% Others 8.1% Market Total YoY increase from 1 to 2% in total volume driven by aggressive marketing activities through new product launch and renewed core brands in each beverage company Asahi Soft Drinks Sales Volume +4.8% YoY growth in total driven by favorable results of core brands including Wilkinson, WONDA, Calpis. Total results above target achieved due to strong performance from lactic acid drinks, despite mineral water finished below target 5

7 Soft Drinks Business (Core Operating Profit) <Core Operating Profit> (JPY billion / Millions of cases) Sales Volume Total % % Revenue Total % % Increase in sales volume Change in production composition, etc Cost reduction Cost increase Decrease in sales promotion expenses Other expenses Asahi Soft Drinks % LB % % Other / elimination in segment % % Core Operating Profit % % Factors Contributing to Growth / Decline of Asahi Soft Drinks Substantial YoY increase by JPY 2.9 billion due to efficient operation of advertising and promotion expenses, in addition to sales volume increase and product mix improvement Results above target achieved due to sales volume increase and reduction of advertising and sales promotion expenses < Break down of main factors > Increase in sales volume +1.5, Change in production composition, etc. +0.5, Cost reduction +0.7 (Raw materials +0.3, Packages +0.2, Increase of rate of operation / in-house production +0.2) Cost increase -0.1 (Raw materials -0.0, Packages -0.0), Increase in sales promotion expenses +0.5 (Advertisement +0.1, Promotion expenses +0.4) LB -3.2% YoY decrease in revenue due to factors including the revenue decline in convenience stores. Results in core operating profit following target due to manufacturing cost reduction and product mix improvement. 6

8 Food Business (Revenue / Core Operating Profit) <Revenue> Asahi Group Foods % % Other / elimination Corporate adjustment (IFRS adjustment) Revenue Total % % <Core Operating Profit> Asahi Group Foods % % Other / elimination % Core Operating Profit % % Revenue +6.2% YoY growth driven by continuous favorable results of core brands including MINTIA and baby food. Results above targets achieved due to frim results of core brands in each business. Core Operating Profit +76.8% YoY growth due to volume growth and control of advertising and promotion expenses, in addition to manufacturing cost reduction. Results above target achieved due to the factors including part of costs shift to the next term. 7

9 Overseas Business (Revenue) <Revenue> Europe business Oceania business % % Southeast Asia business % % China business % % Other / elimination in segment % % Corporate adjustment (IFRS adjustment) Revenue % % <Revenue (excluding foreign exchange impacts associated with conversion of local currencies into JPY)> Europe business Oceania business % % Southeast Asia business % % China business % % Other / elimination in segment % % Corporate adjustment (IFRS adjustment) Revenue % % Revenue +44.1% YoY growth in total driven by new addition of Europe business and increase in Oceania business. (positive forex impact of JPY 0.4 billion) Revenue (excluding forex impacts associated with conversion of local currencies into JPY) Europe: Results slightly above target by achieving JPY 24.5 billion Oceania: +6.4% YoY growth driven by enhancing the sales of growing categories including mineral water and imported premium beer. (Non-alcohol beverages +8%, Alcohol beverages +5%) Southeast Asia: -6.6% YoY decrease due to decline of Malaysia and Myanmar, despite increase of Indonesia. China: -4.6% YoY decrease due to impact of review of manufacturing process for export, despite favorable sales results of Asahi Super Dry in China. Results following target due to excess achievement in Europe and Oceania, despite shortfall in Southeast Asia. 8

10 Overseas Business (Core Operating Profit) <Core Operating Profit> Europe business Oceania business % % Southeast Asia business % % China business % % Other / elimination in segment Core Operating Profit % % <Core Operating Profit (excluding foreign exchange impacts associated with conversion of local currencies into JPY)> Europe business Oceania business % % Southeast Asia business % % China business % % Other / elimination in segment Core Operating Proft % % <Breakdown of Europe> Q1 results Western Europe +1.4 Core OP +1.9 One-off cost -0.4 Central and Eastern Europe -2.2 FA fee -2.2 Interim Target Western Europe +5.5 Core OP +6.4 One-off cost -0.9 Core Operating Profit -20.8% YoY decrease in total due to factors including costs related to acquisition of Central and Eastern Europe business and decrease in Southeast Asia. (positive forex impact of JPY 0.1 billion) Core Operating Profit (excluding forex impacts associated with conversion of local currencies into JPY) Europe: Results above target due to addition by JPY 1.9 billion excluding one-off cost and acquisition related cost Oceania: +65.3% YoY growth driven by increase of Alcohol beverages and improvement of product mix, in addition to creation of integration synergies. Southeast Asia: -91.5% YoY decrease mainly due to deterioration in Malaysia where soft drinks market was stagnant. China: -48.0% YoY decrease due to manufacturing volume decline in Beijing Brewery and product mix deterioration in Yantai Beer. Results excluding the cost related to acquisition of Central and Eastern Europe business following target due to firm results in Western Europe and Oceania, mitigating shortfall in Southeast Asia. 9

11 Operating Profit Profit attributable to owners of parent Summary of Statement of Profit of Loss Revenue % % Core operating profit % % Adjustment item Gain (loss) on sales and retirement of non current assets Business integration expeses Others Operating profit % % Financing income or loss Share of profit (loss) of entities accounted for using equity method Others Profit before tax % % Income tax expense Profit Profit attributable to owners of parent % % Profit attributable to non-controlling interests Operating Profit +5.7% YoY growth through contraction of core OP increase mainly due to downturn in reaction to gain on sales of subsidiaries non-current assets last year and loss from restructuring. Profit attributable to owners of parent +29.8% YoY growth due to contraction of share of loss of entities accounted for using equity method associated with decrease of Tingyi-Asahi Beverages equity ratio. Results following target despite slightly shortfall of share of loss of entities accounted for using equity method. 10

12 Information in this material is not intended to solicit sale or purchase of shares in Asahi Group Holdings. The views, estimates and other information expressed in this document are based on the company's judgment at the time of publication, and no guarantees are provided regarding the accuracy of such information. This information is subject to change without notice. The company and its officers and representatives accept no responsibility or liability for any damage or inconvenience that may be caused by or in conjunction with any part of these materials.