Financial Strategy

  In our Medium-Term Management Plan (2023-2026), we set forth a basic policy of “Beyond150 - New Growth Through Business Structure Transformation -.”Aiming to improve our cash ability to generate cash in line with growth and returns in excess of the cost of capital, we have set financial targets and indicators of a return on equity (ROE) ratio of 8%, an average annual EBITDA rate of approximately 10%, and an average annual overseas sales growth rate of approximately 10%. To achieve our goals, we will accelerate structural reforms through reorganization of our business portfolio, growth of our overseas businesses, and enhancement of profitability of core businesses.

  In Alcoholic Beverages (Japan), we will reorganize our product categories and reconfigure costs to shift the structure away from low profitability. Further, we will also achieve growth by making the Black Label and Yebisu brands more attractive, strengthening our RTDs such as Koime no Lemon Sours and Otoko Ume Sours, and by launching new market-creating products. In Alcoholic Beverages (Overseas), we will aim for further growth of the Sapporo brand in the United States, a growth driver, by creating synergy with Stone Brewing Co., LLC, which became a subsidiary in August 2022. In Beverages (Overseas), we will accelerate growth by expanding sales in countries and regions with growth potential, such as Malaysia and the Middle East, starting from Singapore. In Restaurants, we will further strengthen the revenue base and focus on synergy with the Alcoholic Beverage (Japan) business to realize stable profits and increase brand communication. In Food & Soft Drinks, we will decisively implement drastic structural reforms by 2024 to focus on the lemon business and break away from low profitability. In the Real Estate, we will improve profitability and asset efficiency over a long-term time horizon by transforming from a business entity focused on rentals to one that comprehensively enhances asset value. In addition, we will leverage our strengths as the owner of the historic brands and assets that bear the names of the cities of Sapporo and Yebisu to promote integrated community development through co-creation with local governments and partners to enhance value. To strengthen our business portfolio in the segment, we will manage capital efficiency through ROIC (return on invested capital) using the WACC (weighted average cost of capital) of each business as a benchmark. We will strive to improve ROE by reorganizing our business portfolio and increasing asset efficiency.

  Maintaining our current credit rating will be the basis of our financial soundness. Regarding investment, we will promote growth by prioritizing overseas investments balanced with operating cash flow, and we will also promote investments in sustainability. Further, we will respond flexibly to growth investment opportunities such as M&A to the extent that we can secure our current credit rating.

  Regarding shareholder returns, we have positioned the appropriate return of profits as an important management policy, and our basic policy is to pay stable dividends, taking into consideration our operating results, financial position, etc. Dividends will be based on a consolidated dividend payout ratio of 30% or more, with the current level as the lower limit. However, in the event that profit attributable to owners of parent fluctuates significantly due to special factors, we will take impact of such fluctuations into consideration when determining dividends. We also aim to increase dividend levels along with medium-to-long-term profit growth. In FY2021, we paid a dividend of ¥42 per share, taking into consideration our operating results, financial condition, and other factors.

Moving forward, the Sapporo Group will strive to increase its cash-generating capabilities and capital efficiency by implementing structural reforms through the reorganization of our business portfolio, growing our overseas business, and engaging in initiatives to enhance the profitability of our core businesses at an even faster pace. Moreover, we will meet the expectations of our stakeholders by realizing sustainable growth and by increasing corporate value over the medium-to-long term. In order to engage in meaningful dialogue with shareholders and investors, we will continue our efforts to deepen the substance of dialogue through the proactive disclosure and dissemination of information. We look forward to your continued honest feedback and your support.