sapporo group long-term management vision “speed150” · 1.review of the past 10 years and...
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Copyright, 2016 SAPPORO HOLDINGS LTD. All rights reserved.
Sapporo Group Long-Term Management Vision
“SPEED150” SAPPORO Eternal Expansion Design
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November 2, 2016
Sapporo Holdings LTD.
Copyright, 2016 SAPPORO HOLDINGS LTD. All rights reserved.
The Sapporo Group strives to maintain integrity in corporate conduct that reinforces stakeholder trust,
and aims to achieve continuous growth in corporate value.
Management Philosophy and Fundamental Management Policy
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As an intrinsic part of people’s lives, Sapporo will contribute to the evolution of creative,
enriching and rewarding lifestyles.
Management Philosophy
Fundamental Management Policy
Copyright, 2016 SAPPORO HOLDINGS LTD. All rights reserved.
Agenda
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Sapporo Group Long-Term Management Vision “ SPEED150” (2017-2026)
1.Review of the Past 10 Years and Awareness of Issues (1) New Management Framework (2) Results (3) Accomplishments and Issues
2.Long-Term Management Vision “ SPEED150” (1) Analysis of the Environment (2) Fundamental Policy (3) Management Platform (4) Roadmap (5) Relationships with Stakeholders
Copyright, 2016 SAPPORO HOLDINGS LTD. All rights reserved.
Creating high-value-added products and services
Form strategic alliance
Promote international expansion Expand synergies among Group companies
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・The Group has identified two businesses domains: “the creation of value in food” and “the creation of comfortable surroundings”. ・ The Group plans to expand its business in these areas through the utilization of the assets and strengths at its disposal.
【 Business Domains】
【 Group Strategy】
1.Review of the Past 10 Years and Awareness of Issues (1) 2007 New Management Framework Outline
Fundamental Strategy
Quantitative Targets
Consolidated net sales (including liquor) ¥600.0 billion Consolidated operating ¥ 40.0 billion
Copyright, 2016 SAPPORO HOLDINGS LTD. All rights reserved.
1.Review of the Past 10 Years and Awareness of Issues (2) Results
Qualitative Results for the Entire Group
Expanded business domains with a view to growing into a food manufacturer through strategic alliances and international expansion
Pushed ahead with enhancing the value of brand assets to guide the Group to future growth, by amassing experience in various challenging initiatives based on the themes of creating high-added-value and expanding synergies
【Main Initiatives Based on Group Strategies】
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Promote international expansion
Form strategic alliance Creating high-value-added
products and services
Expand synergies among Group companies
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Integrated business with POKKA CORPORATION
Acquired 51% of the shares of COUNTRY PURE FOODS, INC.
Entered the beer business in Vietnam
Opened GINZA LION BEER HALL in Singapore
Established a soft drinks joint venture in Indonesia
Formed a business alliance with BACARDI JAPAN LIMITED
Commenced operations in earnest at the Nasu Brewery
Implemented value-added renovation of
YEBISU Garden Place
Strengthened imported fine wines
Completed construction of GINZAPLACE
Established Sapporo Proassist
Established Sapporo Group Management Ltd.
Opened the Group online shopping site
Promoted Group-wide collaborative product
development (Kireto Lemon -Sour, GREENSHOWER,etc.)
Opened the YEBISU BAR Formed a capital and business
alliance with POKKA
Commenced operations in earnest at Sleeman Breweries Ltd. following the acquisition of shares (2006)
Developed SAPPORO+
Commenced the soy milk and chilled products business
Opened the GRANDE POLAIRE wine bar
Acquired 51% of the shares of Silver Springs Citrus Inc.
Developed Goku Zero and Otoko Ume Sour
The POKKA brand was ranked No.1 in the non-carbonated beverage category of a consumer trends survey in Singapore.
Copyright, 2016 SAPPORO HOLDINGS LTD. All rights reserved.
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
45.0
50.0
0.0
100.0
200.0
300.0
400.0
500.0
600.0
700.0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016見込 目標
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■ Established an earnings base that is able to generate steady operating income with low volatility. ■ Achieved steady sales growth through an expansion in business fields, with net sales recovering to the ¥500.0 billion level for the first time since 2002. Net sales have reached an all-time high since the shift to the holding company structure. ■ Profits did not grow in line with the sales growth trend, and results fell significantly short of target.
Billions of yen
2016 Forecast
1.Review of the Past 10 Years and Awareness of Issues (2)Results
Quantitative Results for the Entire Group
New Management Framework
●
Operating income (after goodwill) / right scale Operating income (before goodwill) / right scale
Net sales
Achievement of target ×
Profit growth ×
Sales growth 〇
Earnings base 〇
Target
From 2003 – Transition to holding company
Copyright, 2016 SAPPORO HOLDINGS LTD. All rights reserved.
-10.0
0.0
10.0
20.0
30.0
40.0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 目標
0.0
100.0
200.0
300.0
400.0
500.0
600.0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 目標
(10,000)
0
10,000
20,000
30,000
40,000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
見込
目標
国内酒類 国際 食品・飲料 外食 不動産 その他
未 位カエ 年号カエ 凡例カエ
【Operating income (before amortization of goodwill)】
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【Net sales】
Japanese Alcoholic Beverages and Real Estate helped to establish a steady earnings base for the entire Group. The expansion of fields in International and Food & Soft Drinks helped sales growth, but did not lead to growth in profits. The main reason for the shortfalls against target was the lack of growth in profits from the expanded fields.
Expanded fields lacking growth in profits = International business (Vietnam, North American soft drinks), Food & Soft Drinks business (POKKA SAPPORO)
Billions of yen
1.Review of the Past 10 Years and Awareness of Issues (2)Results
Quantitative Results by Segment
2016 Forecast
Target
Billions of yen Achievement
of target ×
Profit growth
Achievement of target ×
× Sales growth 〇
Earnings base 〇
Target
Japanese Alcoholic Beverages
Food & Soft Drinks
Real Estate
International
Restaurants
Others
Japanese Alcoholic Beverages
Food & Soft Drinks
Real Estate
International
Restaurants
Others
Corporate
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Accomplishments Issues
Man
agem
en
t
Steady growth in businesses acquired through M&As
• Solid track record in nurturing acquired businesses such as the shochu business and Sleeman Breweries
Strengthened group management structure
• Established governance structure, promoted streamlining of Head Office functions
Demonstrate the ability to deliver on commitments
• Leadership needed to guide the Group to achievement of Group plans
• M&A execution process reforms
Establish global management platform • Establish a Group management structure optimal for further
growth
Finan
cial
Achieved sales growth • Steadily increased sales through such means as M&As and
alliances
Established an earnings base • The Japanese Alcoholic Beverages and Real Estate segments
generated steady operating income
Expand profitability • Strengthen profitability leveraging the strengths of existing
businesses • Producing results in the investment as early as possible
Strengthen stability • Work to reduce interest-bearing liabilities
Bu
sine
ss
Reaffirmed and bolstered the strengths of each business
• Selectively concentrated on products and services where the Group has differentiable strengths
Expanded business fields • Expanded fields in the International and Food & Soft Drinks
segments
Achieve continuous growth in existing businesses
• Deliver steady growth based on brands • Drive growth and globalization in the Alcoholic Beverages, Food
and Soft Drinks fields
Capture growth opportunities • Create opportunities that drive new growth as early as possible
1.Review of the Past 10 Years and Awareness of Issues (3)Accomplishments and Issues
Accomplishments and Issues
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・ Further aging with fewer children and a declining population ・ Widespread adoption of diversity management ・ Increase in natural disasters ・ Instant dissemination of information due to advances in IT and diversified modes of transportation ・ Further diversification of needs and polarization of consumption patterns in line with changing lifestyles
・ Stagnation in the Chinese economy ・ Population growth, economic development, and the rise of a massive new middle income class in emerging countries in Africa, Asia and elsewhere ・ Geopolitical instability reflecting politics, religion and other factors ・ Supply of products and services on a global scale due to the expansion of the IT market ・ Corporate realignment on a global scale and further M&A activity by Japanese companies
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Japan
O
verseas
2.Long-Term Management Vision “SPEED150” (1)Analysis of the Environment
Market Environment
Aggregate demand has been decreasing due to Japan’s declining population along with diversifying consumer needs due to changing lifestyles. In this environment, it will be increasingly crucial to
carefully identify growth fields in the process of creating value. Meanwhile, companies will work harder to find growth opportunities overseas.
Copyright, 2016 SAPPORO HOLDINGS LTD. All rights reserved.
Various corporate business activities undertaken over 140 years
2.Long-Term Management Vision “SPEED150” (2)Fundamental Policy
Source of the Sapporo Group’s Growth
Human resources
Innovation Quality
SAPPORO, YEBISU, SLEEMAN , POKKA, GINZA LION BEER HALL, YEBISU GARDEN PLACE and others
Brand assets = Source of growth
Providing new value through innovation and scaling new heights by pursuit of quality are strengths that the Group has exerted since it was founded.
The Sapporo Group’s brand assets, which have been long cultivated by the Group with the support of customers, are our source of growth.
The Sapporo Group will achieve robust growth by reaffirming those assets and honing the individuality of its brands in tandem with expanding its contact points with customers.
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Copyright, 2016 SAPPORO HOLDINGS LTD. All rights reserved.
2.Long-Term Management Vision “SPEED150” (2)Fundamental Policy
The Group’s Core Businesses
“Alcoholic Beverages” “Food” “Soft Drinks”
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The Sapporo Group has positioned “Alcoholic Beverages”, “Food” and “Soft Drinks” as its three core business fields and will work to nurture and strengthen its brands.
Copyright, 2016 SAPPORO HOLDINGS LTD. All rights reserved.
2.Long-Term Management Vision “SPEED150” (2)Fundamental Policy
2026 Group Vision
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The Sapporo Group will be a company with highly unique brands in the fields of
"Alcoholic Beverages", "Food", and "Soft Drinks" around the world.
2026 Group Vision
1. Make customers lifestyle around world more fulfill by creating new value through the pursuit of innovation and quality.
2. Strive to provide products and services and to nurture brands that foster communication among customers.
3. Practice efficient management in tandem with addressing changes in the environment.
Action Guidelines
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①Establish Robust Profitability in the Japanese Alcoholic Beverages and Soft Drinks Businesses
②Accelerate growth in the “Food” field
③Promote Global Business Expansion
In the Japanese Alcoholic Beverages business, the Group will strengthen brands in the beer business and nurture the wine business. In the Soft Drinks business, the Group will strategically shift to a profitable structure and expand overseas business. Through these measures, robust profitability will be established to drive the growth of the entire Group.
Broadly increase the presence of the Sapporo Group in the “Food” field by strengthening existing businesses and entering new businesses through the provision of delicious taste, enjoyment and fulfillment to all dining settings.
Increase the Group’s presence globally by strengthening the global management platform as the Group’s growth driver and promoting the growth of existing businesses and new business development initiatives such as M&A activity.
2015年 2026年
2.Long-Term Management Vision “SPEED150” (2)Fundamental Policy
Growth Strategy Theme
Along with measures to achieve continuous growth in existing businesses, the company decide the three major strategic themes that will lead the Group’s growth.
Net sales
Operating income
2016 2026
North America
Europe (London Representative Office)
Southeast Asia
forecast
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【R&D】 Pursue innovative “food value creation”
【HR】 Develop “Go Beyond Boundaries” personnel
【Finance】 Enhance cash generation capabilities
Nurture human resources who “Go Beyond Boundaries” personnel —those who can deliver new value and inspiration while facing many different customers, thereby spurring the Group’s growth. To achieve this vision, build a Group-wide environment that enables personnel to improve themselves in a healthy, optimistic and positive manner.
Enhance cash generation capabilities by improving profitability and push ahead with proactive investment in growth fields to increase corporate value.
R&D, human resources, and finance, which form the Group’s management platform, will strive to lay a strong groundwork for the Group to promote its business strategies,
with a view to building stronger brands.
Enhance R&D competitiveness by promoting Group collaboration and groundbreaking open innovation through the establishment of a new Group research and development framework and strategic intensive investment. While strengthening the ability to promote commercialization, the Group will vigorously push ahead with the creation of new value in “Alcoholic Beverages”, “Food” and “Soft Drinks”, thereby guiding the Group to growth.
2.Long-Term Management Vision “SPEED150” (3)Management Platform
Management Platform
Copyright, 2016 SAPPORO HOLDINGS LTD. All rights reserved.
SPEED150
2.Long-Term Management Vision “SPEED150” (4)Roadmap
Long-term Vision Roadmap
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Transform with unprecedented speed
Proactively invest and produce results
Tackle the challenge of creating
First Medium-Term Management Plan
(2017-2020)
Second Medium-Term Management Plan
(2021-2023)
Third Medium-Term Management Plan
(2024-2026)
Strengthen brands
・Transformation of the Group management platform ・continuous growth in existing businesses ・Producing results in the investment ・Capturing growth opportunities
・Proactively invest in growth ・Achieve continuous growth ・Produce results to realize the vision
・Achieve the vision ・Proactive initiatives to reach the next stage
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Employees
Customers
Communities and society
Shareholders
Suppliers
Diversity, Health promotion Build a culture that encourages employees to tackle challenges
Provide valuable products and services that are trusted
Compliance with the Corporate Governance Code, appropriate
shareholder returns
Procurement in consideration of human rights and the environment
Nurturing and food education for the next generation, regional vitalization, environmental preservation
leveraging business characteristics
The Sapporo Group seeks to ensure transparency and fairness in management by enhancing corporate governance in conjunction with maintaining integrity in corporate conduct based on the Sapporo Group’s Basic CSR Policy . Through these measures, the Group will strive to disclose
information proactively and appropriately and foster interactive communication, thereby deepening its relationships of trust with all stakeholders.
2.Long-Term Management Vision “SPEED150” (5) Relationships with Stakeholders
Enhancing Corporate Communication
Copyright, 2016 SAPPORO HOLDINGS LTD. All rights reserved.
The earnings forecasts and forward-looking statements appearing in this document were prepared by the Sapporo Group based on currently available information and its best assessment of potential risks and uncertainties.
Actual outcomes may differ materially from forecasts due to changes in various underlying factors.