Results briefing for the 2 nd quarter of Fiscal Y ear ending - PowerPoint PPT Presentation

Results briefing for the 2 nd quarter of Fiscal Y ear ending December 2013 July 29, 2013 Coca-Cola West Company, Limited (2579) [Contact] Planning Department (IR team) TEL 092-641-8774 FAX 092-641-9128 ［ URL ］ http:/ / www.ccwest.co.jp/ ［ E-mail ］ junko-kubo@ccwest.co.jp

Agenda st half I. Account settlement for the 1 st half I. Account settlement for the 1 nd half and Full II. Plans for the 2 nd half and Full- -year year II. Plans for the 2 [Reference] Account settlement for Q2 (April-June) Trend of OTC market share Mix by brand/ by channel Sales update on vending machines by channel Q2 Actual sales volume (by channel and by package) Sales volume by channel and by package 2H Volume plan Performance trend / managerial KPI trend Coca-Cola System in Japan / Affiliated companies 1

I. Account settlement for the 1st half I. Account settlement for the 1st half 2

Account settlement for 1H (Jan-June) - Volume ■ Our sales volume finished slightly behind target and PY with market share negative versus PY . ■ Volume, however, has been on the recovery trend since May. [Ref] Real comparison 1 2 Vs . PY Vs . Ta rge t* 2013 1H Vs . PY * a ctua l (Unit: K cases, %) Diff % Diff % Diff % - 5 1 9 - 0 . 5 Volume 94,672 -769 -0.8 +8,548 +9.9 85,520 CCW a re a *1 Target refers to the figures based on the performance M K yus hu a re a forecast published on May 1, 2013. 9,152 (Apr-June ) *2 PY actual figures include April-June performance of Minami Kyushu CCBC. * 2 ) Monthly volume trend (vs. PY (% ) Apr-June ＋ 0.7 3

Account settlement for 1H (Jan-June) – Sales volume by channel ■ Chain Store outperformed the target and PY . → Favorable results in Supermarket V. target and PY impacted by PoC captured through campaigns and bolstered sales of SS PET. → On the other hand, Convenient stores was unfavorable V. target and PY , struggled with Georgia. ■ Highly profitable Vending underperformed both the target and PY in volume. → Active Vending machines did not meet the plan and on the declining trend from PY . → VPM *1 dropped. [Ref] Real comparison 2 4 vs. PY vs. ta rget* vs. PY * 1H a ctua l (Unit: K c/ s, % ) Diff % Diff % Diff % 3 26,232 +547 +2.1 +3,852 +17.2 +1,057 +4.2 Superma rket * Convenience store 10,743 -425 -3.8 +591 +5.8 -382 -3.4 Cha in Store tota l 36,976 +122 +0.3 +4,444 +13.7 +675 +1.9 Vending 26,724 -560 -2.1 +1,889 +7.6 -946 -3.4 Reta il 6,474 -396 -5.8 +758 +13.3 -301 -4.4 Food Service 9,681 -145 -1.5 +550 +6.0 -174 -1.8 Other 14,818 +211 +1.4 +906 +6.5 +227 +1.6 Tota l 94,672 -769 -0.8 +8,548 +9.9 -519 -0.5 * 4 PY *1 Sales volume per unit of vending machine actual figures include April-June performance *2 Target refers to the figures based on the performance forecast published on May 1, 2013 of Minami Kyushu CCBC. 4 *3 Drug store/ Discounter/ Home center are included in supermarket

Account settlement for 1H (Jan-June) – Sales volume by package ■ Highly profitable SS PET was nearly on target and outperformed PY . → Bolstered sales of SS PET and Mini PET in Supermarket. → Vending proactively switched to SS PET from Cans. ■ On the other hand, high-yielding Canisters were remarkably behind target and PY . → Strategic switchover to PET (resealable products) → Stagnated sales of Georgia. [Ref] Real comparison 2 2 vs. PY vs. target* vs. PY * 1H actual (Unit: K c/ s, % ) Diff % Diff % Diff % SS (1,000ml or s ma lle r) 24,682 -71 -0.3 +4,821 +24.3 +2,201 +9.8 714 -109 -13.3 +202 +39.4 +152 +27.1 MS (s m a lle r tha n 1,500ml) PET 17,548 +291 +1.7 +1,759 +11.1 +118 +0.7 LS (1,500m l or la rge r) Total 42,944 +110 +0.3 +6,781 +18.8 +2,471 +6.1 Can (incl. bottle can) 25,839 -1,024 -3.8 +56 +0.2 -3,137 -10.8 Others 6,173 +141 +2.3 +544 +9.7 +350 +6.0 Syrup, powde r 19,715 +5 +0.0 +1,167 +6.3 -203 -1.0 Total 94,672 -769 -0.8 +8,548 +9.9 -519 -0.5 * 1 Target refers to the figures based on the performance forecast published on May 1, 2013 * 2 PY actual figures include April-June performance of Minami Kyushu CCBC. 5

Account settlement for 1H (Jan-June) – Sales volume by brand ■ Coca-Cola Zero turned positive both V. target and PY , as Zero limit campaign leveraging EXILE worked. ■ Sokenbicha recovered since Q2 through deployment of “National referendum campaign” and bolstered sales at the time of product renewal. ■ Georgia declined V. target and PY , especially in Vending and Convenient stores. [Ref] Real comparison *2 *3 vs. PY vs. target vs. PY 1H actual (Unit: K c/ s, % ) Diff % Diff % Diff % 6,621 -49 -0.7 +656 +11.0 -30 -0.4 Coca -Cola 3,289 +158 +5.1 +625 +23.4 +340 +11.5 Coca -Cola Zero 3,764 +72 +1.9 +478 +14.6 +99 +2.7 Fanta 20,523 -993 -4.6 +1,027 +5.3 -1,489 -6.8 Georgia Core 8 5,038 +87 +1.8 +426 +9.2 +90 +1.8 Sokenbicha 8,772 +441 +5.3 +1,569 +21.8 +666 +8.2 Aqua rius 5,772 +194 +3.5 +1,382 +31.5 +515 +9.8 Aya taka 4,244 -198 -4.5 +621 +17.2 +246 +6.1 I-L oha s 58,024 -289 -0.5 +6,784 +13.2 +436 +0.8 Subtota l 16,933 -485 -2.8 +597 +3.7 -751 -4.2 Other 2 Products 74,957 -773 -1.0 +7,380 +10.9 -315 -0.4 RTD* 19,715 +5 +0.0 +1,167 +6.3 -203 -1.0 Syrup, powder 94,672 -769 -0.8 +8,548 +9.9 -519 -0.5 Total * 1 Packaged products * 3 PY actual figures include April-June performance * 2 Target refers to the figures based on the performance forecast published on May 1, 2013 of Minami Kyushu CCBC. 6

Account settlement for 1H (Jan-June) (Unit: MM JPY , %) Vs. target Vs. PY 2013 1H 2012 1H Target* actual actual Diff % Diff % Revenue 196,225 199,300 -3,074 -1.5 184,300 +11,924 +6.5 Gross profit 98,227 99,900 -1,672 -1.7 90,720 +7,506 +8.3 on sales Operating 4,783 4,700 +83 +1.8 3,157 +1,625 +51.5 income Ordinary 5,672 5,200 +472 +9.1 3,086 +2,585 +83.8 profit Current net ー 11,056 2,700 +8,356 +309.5 1,003 +10,053 profit * Target refers to the figures based on the performance forecast published on May 1, 2013 [Ref] Real comparison (PY actual figures include April-June performance of Minami Kyushu CCBC) 2013 1H Vs. PY (Unit: MM JPY , %) actual Diff % Revenue 196,225 -3,119 -1.6 Operating 4,783 +1,238 +34.9 income 7

Impacts to 1H performance from Minami Kyushu CCBC being made a wholly-owned subsidiary ■ Booked Non-operating income (profit on equity-method investments) → 1,046 MM JPY ・ Increased our shares of Minami Kyushu CCBC in Q1 though acquisition of their treasury stocks (Mar.) ■ Recorded Extraordinary loss (from phased acquisition) → 5,567 MM JPY ・ Loss pertaining phased acquisition for the shares retained (32.71 %) prior to stock exchange (making a wholly-owned subsidiary) with the market value when the stocks were exchanged. ■ Registered Extraordinary profit (from negative goodwill) → 14,438 MM JPY ・ Gain on negative goodwill as the net value of accepted assets and assumed liabilities exceeded the value of acquired stocks. 8

Account settlement for 1H (Jan-June)– Causes of Difference (comparison with Target*) (Unit: 000 MM JPY ) Target* 2013 Q1 actual Diff Key causes Diff (val) ・ Coca-Cola business -31.7 1,993 1,962 -30 Revenue ・ Healthcare & Skincare business +1.0 ・ Coca-Cola business -17.4 Gross profit 999 982 -16 ・ Healthcare & Skincare business on sales +0.7 Increase/decrease of SG & A ・ Decrease of promo/advertisement cost +5.1 ・ Decrease of outsourcing cost +2.7 ・ Decrease of sales equipment +2.0 Gross profit ・ 47 47 +0 Decrease of depreciation costs +2.0 on sales ・ Decrease of sales commissions +1.4 ・ Decrease of labor cost +0.8 ・ Increase of transportation cost -4.6 ・ Healthcare & Skincare business -0.5 ・ Ordinary Decrease of Non-operating costs (loss on 52 56 +4 +2.8 disposal of fixed assets etc.) profit ・ Increase of extraordinary profit (on negative goodwill) +144.3 Current net ・ 27 110 +83 -65.6 Increase of extraordinary loss (pertaining to phased acquisition etc profit ・ Corporate tax etc. -0.1 * Target refers to the figures based on the performance forecast published on May 1, 2013 9

Account settlement for 1H (Jan-June)– Causes of Difference in operating income (Comparison with Target*) Despite marginal profit decline in Coca-Cola business due to dropped sales volume & WSP or worsened package mix, corporate-wide cost reductions delivered results of OI at 2.5 billion JPY as planned. Healthcare & Skincare business also finished with OI at 2.2 billion JPY according to plan. ( ＋０ Coca-Cola business ) (Unit: 000 MM JPY ) Other cost Decrease reductions ＋９ Decrease of of other cost Decrease of marginal ＋３ promotion profit activities Other WSP drop ＋４ -11 (SCM) SCM - ７ ＋１ impact 47 47 ＋１ ・ Review of sales equipment related ＋１ activities ・ ＋４ Decrease of repair/maintenance ・ ＋１ Decrease of fuel costs ・ - ６ Chain stores ・ - １ ・ Decrease of outsourcing to packers Vending 2013 Target* 1H Actual * Target refers to the figures based on the performance forecast 10 published on May 1, 2013