Our Medium-Term Management Plan 2012 sets forth milestones to be achieved as we work toward our Long-Term Vision 2015. The top priority of the medium-term plan is to increase the profitability of our existing businesses.

 

First and foremost among our achievements in the first year of this plan was the steady progress made toward improving our earnings structure. As a result, we reached our profit targets for the year. In particular, the alcoholic beverage business exceeded its profit growth target thanks to more efficient use of production costs and fixed costs. For the first time since we launched Asahi Super Dry, we decided to consolidate our breweries and began efforts to raise their productivity.

 

Our second key achievement during 2010 was the expansion of the foundations for growth of our existing businesses. For example, the soft drinks business bolstered the growth foundation for its mineral water business by acquiring the Rokko no Oishii Mizu brand from House Foods. In December, we agreed to purchase Kagome's Rokujo Mugi-cha brand barley tea drink, and we expect to expand the product's lineup during 2011.

 

Our food business, meanwhile, continued to grow its existing brands while also building new growth platforms. For example, all group subsidiaries in this segment added production capacity in 2010, and we also continued to build our natural seasonings business.

 

The third noteworthy achievement of the past year was the strengthening of the earnings base of our overseas business. We further strengthened our tie-up with Tsingtao Brewery, in which we first took an equity stake in 2009, and we are now close to turning a profit in our China beer business. Meanwhile, we sold our stake in Haitai Beverage.

 

As part of our move from a loss-cutting phase to a more aggressive posture in our overseas business, we acquired Australia's P&N Beverages and took an equity position in China's Ting Hsin Group as part of our effort expand the overseas networks in each of our businesses.

 

On the other hand, while we achieved our targets, we feel that in a broad sense we still need to be more innovative in alcoholic beverage business. Last year, we achieved a measure of success in cultivating existing brands through such efforts as proposing new ways for consumers to enjoy Asahi Super Dry.

 

Nevertheless, we must carry out further reforms, not just in our marketing activities, where we seek to create new value and new demand, but across the entire spectrum of supply chain management, from product development to sales activities.

 

The second issue facing us is the need to further prepare and expand the Asahi Group's business foundations. Our domestic soft drinks business continues to grow faster than the industry average, but competition in the industry is excessive. We therefore urgently need to pursue alliances and realignment that will ensure reasonable profit levels.

 

Our food Business is developing business in many areas, and group companies are successfully cultivating their core brands. Going forward, however, while monitoring the group's overall scale, we will need to focus more resources on businesses that will be future growth engines.

 

Similarly, in our overseas business, we are ready to shift our focus from cutting losses to strengthening and expanding the businesses that will provide the foundation for future growth. I will explain our plans for addressing these issues in my comments on each individual business segment.