Suntory Beverage & Food : Summary of Consolidated Financial Results for Q2 2022

English Translation

August 9, 2022

	Summary of Consolidated Financial Results
	for the First Six Months of the Year Ending December 31, 2022
	(UNAUDITED)
Company name:	Suntory Beverage & Food Limited
Shares listed:	Tokyo Stock Exchange
Securities code:	2587
URL:	https://www.suntory.com/sbf/
Representative:	Kazuhiro Saito, Chief Executive Officer
Inquiries:	Kazushi Ishikawa, Chief Financial Officer, Corporate Strategy Division
	TEL: [phone] (from overseas)

Scheduled date to file quarterly securities report:	August 10, 2022
Scheduled date to commence dividend payments:	September 6, 2022
Preparation of supplementary material on quarterly financial results:	Yes
Holding of quarterly financial results presentation meeting (for institutional investors and analysts):	Yes

(Millions of yen with fractional amounts discarded, unless otherwise noted)

1. Consolidated financial results for the first six months of the year ending December 31, 2022 (from January 1, 2022 to June 30, 2022)

(1)	Consolidated operating results
							(Percentages indicate year-on-year changes)
			Revenue		Operating income	Profit before tax for the	Profit for the period
				period
	Six months ended	(Millions of yen)	(%)	(Millions of yen)	(%)	(Millions of yen)	(%)	(Millions of yen)	(%)
	June 30, 2022	679,009	12.4	80,370	33.1	80,206	35.2	58,108	43.4
	June 30, 2021	603,835	9.3	60,401	69.1	59,343	69.0	40,508	52.5
			Profit for the period	Comprehensive income	Basic earnings	Diluted earnings
			attributable to owners of
			for the period	per share		per share
			the Company
	Six months ended	(Millions of yen)	(%)	(Millions of yen)	(%)		(Yen)		(Yen)
	June 30, 2022	48,734	51.5	129,486	80.0		157.72		-
	June 30, 2021	32,159	53.7	71,927	-		104.07		-
(2)	Consolidated financial position
									Ratio of equity attributable
			Total assets		Total equity	Equity attributable to	to owners of
				owners of the Company	the Company
									to total assets
	As at	(Millions of yen)	(Millions of yen)	(Millions of yen)		(%)
	June 30, 2022	1,848,875		1,056,633		956,528		51.7
	December 31, 2021	1,676,926		943,952		860,593		51.3

(3) Consolidated cash flows

	Net cash inflow (outflow)	Net cash inflow (outflow)	Net cash inflow (outflow)	Cash and cash equivalents
	from operating activities	from investing activities	from financing activities	at the end of the period
Six months ended	(Millions of yen)	(Millions of yen)	(Millions of yen)	(Millions of yen)
June 30, 2022	80,562	(8,170)	(32,837)	224,426
June 30, 2021	88,976	(24,168)	(72,559)	162,280

2. Dividends

				Annual cash dividends
		First quarter-end	Second quarter-end	Third quarter-end	Fiscal year-end	Total
		(Yen)	(Yen)	(Yen)	(Yen)	(Yen)
Fiscal year ended	-	39.00	-	39.00	78.00
December 31, 2021
Fiscal year ending	-	39.00
December 31, 2022
Fiscal year ending
December 31, 2022			-	39.00	78.00
(Forecast)
Note:	Revisions to the forecast of dividends most recently announced: None

3. Consolidated earnings forecast for the fiscal year ending December 31, 2022 (from January 1, 2022 to December 31, 2022)

(Percentages indicate year-on-year changes)

Profit for the year

Revenue

Operating income

Profit before tax

Profit for the year

attributable to

Basic earnings

owners of

per share

the Company

(Millions of

(%)

(Millions of

(%)

(Millions of

(%)

(Millions of

(%)

(Millions of

(%)

(Yen)

yen)

yen)

yen)

yen)

yen)

Fiscal year ending

1,369,000

7.9

125,500

5.8

124,000

5.9

88,500

6.6

73,500

7.0

237.86

December 31, 2022

Note:

Revisions to the earnings forecast most recently announced: None

* Notes

1. Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in the change in scope of consolidation): None
2. Changes in accounting policies and changes in accounting estimates

a.	Changes in accounting policies required by IFRS:	None
b.	Changes in accounting policies due to other reasons:	None
c.	Changes in accounting estimates:	None

1. Number of issued shares (ordinary shares)
   a. Total number of issued shares at the end of the period (including treasury shares)

As at June 30, 2022	309,000,000 shares
As at December 31, 2021	309,000,000 shares

1. Number of treasury shares at the end of the period

As at June 30, 2022	57 shares
As at December 31, 2021	31 shares

1. Average number of outstanding shares during the period (cumulative from the beginning of the year)

Six months ended June 30, 2022	308,999,960 shares
Six months ended June 30, 2021	308,999,997 shares

• Quarterly financial results reports are exempt from quarterly review conducted by certified public accountants or an audit corporation.
• Proper use of earnings forecast, and other special matters

The earnings forecast contained in these materials are based on our judgment attributable to information available to the Company and the Group as of the date of announcement of these materials, and include certain risks and uncertainties. These statements are not intended as a promise by the Company to achieve such results. Actual business results may differ substantially due to various factors such as economic situation surrounding the Company and the Group, market trend, exchange rates and other factors.

Attached Materials

Index

1.	Qualitative Information Regarding Settlement of Accounts for the First Six Months.....................	2
(1)	Operating results ..............................................................................................................................	2
(2)	Financial position.............................................................................................................................	4
(3)	Analysis of cash flows .....................................................................................................................	4
(4)	Consolidated earnings forecast and other forward-looking statements ...........................................	4

2. Condensed Quarterly Consolidated Financial Statements and Significant Notes Thereto

	(Unaudited) ......................................................................................................................................	5
(1)	Condensed quarterly consolidated statement of financial position..................................................	5
(2)	Condensed quarterly consolidated statement of profit or loss .........................................................	7
(3)	Condensed quarterly consolidated statement of comprehensive income.........................................	8
(4)	Condensed quarterly consolidated statement of changes in equity..................................................	9
(5)	Condensed quarterly consolidated statement of cash flows...........................................................	10
(6)	Notes to condensed quarterly consolidated financial statements ...................................................	11
	(Going concern) .............................................................................................................................	11

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1. Qualitative Information Regarding Settlement of Accounts for the First Six Months

1. Operating results
   Suntory Beverage & Food Limited Group (the Group), based on the philosophy of always starting from consumers, pursuing to create new taste, well-being and joy, and aiming to be the most locally beloved company by proposing premium and unique products that match the tastes and needs of consumers, worked to put effort into brand reinforcement and new demand creation, and worked to improve the quality of products. In addition, the Group worked to strengthen profitability in each area.
   The Group continued strong growth, with the strong demand of the first quarter continuing in the second quarter in Europe and the Americas together with contribution from a relaxation of rules regarding COVID-19 in Japan and the Asia Pacific from the second quarter due to fewer infections. As a result of continuing initiatives that were started at the beginning of the year to concentrate efforts on core brands in all segments, the Group continued to expand market share in the major countries.
   The Group posted overall revenue that was above expectations.
   Operating income was also higher than expected, because although there was an increasing effect from soaring raw material prices and energy prices in the second quarter, the Group was able to continue cost cutting activities in all segments while benefiting from the growth in revenue.
   For the operating results of the first six months of the year ending December 31, 2022, the Group reported consolidated revenue of ¥679.0 billion, up 12.4% year on year. Consolidated operating income was ¥80.4 billion, up 33.1% year on year. Furthermore, profit for the period attributable to owners of the Company was ¥48.7 billion, up 51.5% year on year.
   Results by segment are described below.

< Japan business >

In the second quarter, the beverage market performed stronger year on year (based on the Company's own estimation), which was due to the beginning of the recovery in demand accompanying the lifting of priority preventative measures in addition to favorable weather conditions. The Company carried out initiatives to strengthen its core brands with a focus on the water, coffee, and sugar-free tea categories, and received contributions from sales of new products and marketing activities. This led the Company to significantly increase its sales volume year on year to the highest on record for the first six-month period and further increase market share. For the Suntory Tennensui brand, record- high sales volume was achieved for the first six-month period for the overall brand, with large year- on-year increases being seen for both the large bottles and the small bottles (500 ml PET, etc.). For the BOSS brand, the overall sales volume of the brand increased year on year. In the Craft BOSS series, growth of the coffee and tea series, which were renewed in February, continued. In the sugar- free tea category, a record-high sales volume for the overall Iyemon brand was achieved for the first six-month period. Sales volume grew for the Iyemon Kyoto Blend as well as the Iyemon Koi Aji, which was newly released in February as a food with functional claims. In addition, the sales trend for Tokucha, which was renewed in April, recovered greatly, achieving a year-on-year increase for the first six months.

With the contribution of considerably increased sales volumes, revenue for the first six months recovered to on par with expectations.

In terms of segment profit, although concerted efforts in cost management are continuing, including supply chain cost cutting, the greater-than-expected impact from exchange rates and the soaring price of raw materials hit especially hard from the second quarter.

The Japan business reported revenue of ¥305.9 billion, up 2.6% year on year, and segment profit of ¥14.1 billion, down 19.6% year on year.

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