Coca Cola Bottlers Japan : Consolidated Financial Summary for the First Quarter Ended March 31, 2021 (IFRS)

This flash report is unaudited and the translation of the Japanese language version.

Consolidated Financial Summary for

the First Quarter Ended March 31, 2021 (IFRS)

		May 13, 2021
Listed company name: Coca-Cola Bottlers Japan Holdings Inc.	Listed stock exchanges: Tokyo
Code number: 2579	URL: https://en.ccbj-holdings.com/
Delegate:	Title: Representative Director & President	Name: Calin Dragan
Contact:	Title: Head of Finance Operations and Controllers Division, Finance, Name: Satoshi Kon Phone: [phone]

Expected date of quarterly report submission: May 14, 2021

Schedule for dividends payment: -

Preparation of supplementary materials on quarterly financial results: Yes

Holding of quarterly financial results conference: Yes

(Fractions of one million yen are rounded)

1. Consolidated financial results for the first quarter 2021 (from January 1, 2021 to March 31, 2021)

1. Consolidated financial results

(Percentages indicate changes over the same period in the prior fiscal year)

Net Income (loss)

Revenue

Business income

Operating loss

Net Income (loss)

attributable to owners of Total comprehensive

the parent

Income (loss)

million yen

％

million yen

％

million yen

％

million yen

％

million yen

％

million yen

％

1st quarter, 2021

168,399

(12.8)

(11,596)

－

(15,142)

－

1,306

－

1,316

－

5,013

－

1st quarter, 2020

193,029

(2.9)

(7,081)

－

(8,428)

－

(5,689)

－

(5,690)

－

(10,807)

－

Earnings (Loss) per share

Diluted earnings per share

yen

yen

1st quarter, 2021

7.34

－

1st quarter, 2020

(31.73)

－

*1. "Business Income (loss)" is a measure of our recurring business performance that is calculated as costs of goods and selling, general and administrative expenses are deducted from revenue, and other income and expenses are added and subtracted accordingly.

2. In the fiscal year ending 31 December 2020, the Healthcare and Skincare business has been classified as a discontinued operation as a result of the decision to sell all shares in Q'sai held by the Company. As a result, revenue, business Income and operating loss for the previous financial period have been reclassified to the amounts for continuing operations excluding discontinued operations.

(2) Consolidated financial position

		Total assets	Total equity	Equity attributable to parent owners	Ratio of equity attributable to
					parent owners
		million yen	million yen	million yen	％
	Mar. 31, 2021	930,972	502,375	502,232	53.9
	Dec. 31, 2020	939,603	502,093	501,643	53.4

2. Dividends

			Dividends per share
	1Q	2Q	3Q	Year-end	Annual
	yen	yen	yen	yen	yen
FY ended December 2020	－	0.00	－	25.00	25.00

FY ending December 2021	－
FY ending December 2021		25.00			－	25.00		50.00
(forecast)
Note: Revisions to the cash dividends forecasts most recently announced: None

3. Forecast for consolidated financial results 2021 (from January 1, 2021 to December 31, 2021)

(Percentages indicate changes over the same period in the prior fiscal year)

Net loss for the year

Earnings per

Revenue

Business Income

Operating loss

Net loss

attributable to owners of the

parent

share

million yen

％

million

％

million yen

％

million yen

％

million yen

％

yen

yen

Full-year 2021

－

－

－

－

－

－

－

－

－

－

－

Note: Revisions to the forecasts of consolidated operating results most recently announced: None

The financial forecast for the fiscal year ending December 31, 2021 has not yet been determined because it is difficult to reasonably estimate at this time due to many uncertain factors such as the impact of the spread of the COVID-19 on our business activities. We will provide an update when we are able to estimate the impact to our outlook.

Notes
(1) Changes in significant subsidiaries during the current period:	None
(2) Changes in accounting policies and changes in accounting estimates:
1)	Changes in accounting policies as required by IFRS:	None
2)	Changes other than those in 1) above:		None
3)	Changes in accounting estimates:		None
(3) Number of outstanding shares (common shares)
1) The number of outstanding shares (including treasury shares):F
	1st Quarter, March 2021:	206,268,593 shares
	FY ended December 2020:	206,268,593 shares
2)	The number of treasury shares:
	1st Quarter, March 2021:	26,921,810 shares
	FY ended December 2020:	26,920,298 shares
3)	The number of average shares outstanding:
	1st Quarter, March 2021:	179,347,655 shares
	1st Quarter, March 2020:	179,350,772 shares

• The consolidated financial summary is not subject to quarterly review procedures conducted by certified public accountant or audit firm.
• Explanation regarding appropriate use of the forecast, other special instructions

Figures in the above forecast are based on information available at the time of issuance of this report, and the actual results may be changed due to a number of inherent uncertainties in the forecast. Actual results may differ materially from the forecast. Furthermore, please refer to "1. Qualitative Information on the Financial Summary for this Quarter (3) Information on the Future Outlook, such as Forecast of Consolidated Financial Results" on page 5 for matters relating to performance forecasts.

Table of Contents
1. Qualitative Information on the Financial Summary for this Quarter .....................................................................................................	2
(1)	Qualitative Information on Consolidated Financial Results.............................................................................................................	2
(2)	Qualitative Information on Consolidated Financial Position ...........................................................................................................	4
(3)	Qualitative Information on the Future Outlook, such as Forecast of Consolidated Financial Results .............................................	4
2. Condensed Consolidated Financial Statements and Notes ....................................................................................................................	5
(1)	Condensed Consolidated Statement of Financial Position...............................................................................................................	5
(2)	Condensed Consolidated Statements of Income and Comprehensive Income .................................................................................	7
(3)	Condensed Consolidated Statements of Changes in Equity.............................................................................................................	9
(4)	Notes to Condensed Consolidated Financial Statements ...............................................................................................................	11
(Notes Relating to Going Concern Assumption) .............................................................................................................................	11
(Changes in Accounting Policies)....................................................................................................................................................	11
(Segment Information) ....................................................................................................................................................................	11

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1. Qualitative Information on the Financial Summary for this Quarter

1. Qualitative Information on Consolidated Financial Results

Coca-Cola Bottlers Japan Holdings Inc. ("CCBJH" or the "Company", or "we") announced first-quarter results for the fiscal year ending on December 31, 2021 (January 1, 2021 to March 31, 2021)

During the continued outbreak of the novel coronavirus (COVID-19), the safety and health of our consumers, our customers and our employees- especially those working daily to produce and supply essential goods and services- is our number one priority. Our mission is to deliver happy moments to everyone, even in challenging times, and we have been working with comprehensive business continuity actions in place to ensure safe and secure product supply. In addition to implementing comprehensive infection prevention measures in our commercial activities, we also implemented more flexible work style initiatives, such as working from home and online meetings.

During this quarter (January 1, 2021 to March 31, 2021), the total domestic nonalcoholic ready-to-drink (NARTD) beverage industry volume performance is expected to have declined compared to the prior year, with a new state of emergency declaration from mid-January to late March. While the demand for at-home consumption increased as consumers stayed home during the pandemic, the overall decline in consumer traffic in retail stores, restaurants and at vending machines drove down demand and encouraged the trend of more budget-minded consumer behavior.

We continue to drive fundamental business transformation initiatives as part of our mid-term strategic business plan announced in August 2019, under the guiding principle that "business as usual is not an option". This has not changed, despite the near-term challenges of the COVID-19 pandemic. We are implementing initiatives to return the business to a sustainable growth trajectory, including transformation in the important vending channel and back-office routines to drive cost efficiencies. We are also finding opportunities during these turbulent times to accelerate the pace of ongoing transformation projects and to identify new opportunities. This helps to ensure that we protect the business during current challenges and are well-prepared for the evolution of the business environment in the longer term.

As disclosed in the December 15, 2020, "Notice of Selling of Shares of Q'sai Co., Ltd. and Gain on The Sale of Shares as well as Revision of Earnings Forecast", the share transfer of the Company's consolidated subsidiary, Q'sai Co., Ltd. (Head Office: Fukuoka City, Fukuoka Prefecture; "Q'sai") was completed on February 1, 2021. As a result of the share transfer, 12.8 billion yen of gains from stock transactions and 45 billion yen of cash inflow was recognized in the first quarter of 2021. Accordingly, we have revised our business segment reporting to reflect only the results of continuing operations, the beverage business, after the sale of the health and skincare segment and relevant sections of prior year financial statements and notes have been reclassified.

For the first quarter of the fiscal year, while sales volume decreased due to the ongoing impact of COVID-19, we continued our transformation and cost saving initiatives to offset the impact of the sales decrease. Q1 2021 is cycling relatively solid performance in January and February 2020, prior to the beginning of the COVID-19 impact being felt in Japan. Details are as follows.

In addition to the business update in this document, please also see our earnings presentation material posted on the Company IR website (https://en.ccbj-holdings.com/ir/library/presentation.php) to be used in our earnings conference call on Friday, May 14 at 8:30 am (JST). The earnings presentation and audio will be available live and on demand as an audio webcast in the IR section of the CCBJH website.

Q1 2021 Highlights

• First quarter 2021 reflects the ongoing impact of COVID-19 and a new State of Emergency declared in January, as we cycle a period of limited impact in Q1 2020 as initial restrictions were announced starting in March.
• Major transformation initiatives continue as we reset a solid foundation for recovery and future growth, while also navigating volatility in the current environment.
• Due to the continued impact of COVID-19, Q1 net revenue declined 24.6 billion yen (13%) and Business Income declined 4.5 billion yen versus prior year. Sales volume declines and mix deterioration due to COVID-19 impacted the business while we accelerated transformation efforts and cost reduction initiatives, and started investing again in marketing programs and new product innovation for growth in 2021 after pullback in 2020.
• Market share in terms of both volume and value in the important vending channel continued to grow, with 24 consecutive months of value share growth. In addition, retail channel value share continued to recover and was even versus prior year. The promotional environment is becoming more competitive in some areas, but we are responding to changes in consumer behavior as a business opportunity.
• The Saitama Mega Distribution Center (DC), a key base for logistics in the Tokyo metropolitan area, started operations in

2

February, showing good progress in establishing a flexible and resilient supply network.

• Although the business environment remains uncertain due to the declaration of a third COVID-19 state of emergency, we will continue to focus on areas that we can control and strive to secure profits while minimizing pressure on the top line and promote initiatives that will lead to medium to long-term business growth.
• Continued focus on ESG initiatives. Announced the use of 100% recycled PET resin for Brand Coca-Cola and other small PET bottles.

Summary of Consolidated Financial Results

		(Millions of yen)
Year-to-date Q1 (January to March)
In million JPY	1st Quarter 2020	1st Quarter 2021	Change
(January - March)	(January - March)
Continuing Operation (Beverage Business)
Revenue	193,029	168,399	(12.8％)
Sales volume of beverage business (million cases)	108	97	(10.2％)
Gross Profit	88,888	74,161	(16.6％)
Selling, General & Administrative Expenses	95,663	85,426	(10.7％)
Other income (Recurring)	221	199	(10.1％)
Other expenses (Recurring)	468	391	(16.4％)
Investment loss on equity method	(59)	(139)	－
Business Income	(7,081)	(11,596)	－
Other income (Non-recurring)	0	991	－
Other expenses (Non-recurring)	1,348	4,537	236.6％
Operating Loss	(8,428)	(15,142)	－
Net Income (Loss) Attributable to Owners of Parent	(5,690)	1,316	－

Note: 1. "Business Income (loss)" is a measure of our underlying or recurring business performance. Business Income (loss) deducts cost of goods and selling, general and administrative expenses from revenue, and includes other income and expenses which we believe are recurring in nature.

2. Net Income (Loss) Attributable to Owners of Parent is a total of continuing operation and discontinued operation results.

Net revenue for first quarter 2021 declined to 168,399 million yen (decrease of 24,629 million yen from prior-year period, down 12.8%) due to 10% year-on-year decrease in sales volume caused by the continued impact of COVID-19 and cycling limited impact in the same period last year, mainly from March onward. Although we implemented extensive cost reduction initiatives in all areas, including personnel expenses and other indirect costs, in order to offset the impact of the decline in sales revenue, the deterioration of the channel mix due to the decline in sales volume in the highly profitable vending and convenience store (CVS) channels had a negative impact, resulting in a consolidated business income loss of 11,596 million yen (7,081million yen loss in the same period previous year)

Consolidated operating loss was 15,142 million yen (8,428 million yen loss in the same period of previous year). Other income (non-recurring) includes 990 million yen in government subsidies for employment adjustment to offset temporary leave expense (hereinafter referred to as temporary leave expenses). Other expenses (non-recurring) include 3,736 million yen in temporary leave expenses and 257 million yen in business structure improvement expenses related to the implementation of transformation based on the medium-term plan.

Net income attributable to owners of parent for the quarter, a total of continuing operations and discontinued operation, was 1,316 million yen (5,690 million yen loss in the prior year period) as a gain of 12,841 million yen was recorded in discontinued operations as gains from stock transactions due to the transfer of shares in Q'sai.

3