Main Q&As at FY2023 Q2 Financial Results briefing | Financial Results Briefing / Business Briefing | IR Events | Investors

A.Going forward, we will not pursue a strategy of basically lowering prices and increasing volume. For our highest priority brands, "Asahi Super Dry" and "Peroni Nastro Azzurro," we are pursuing a strategy that leverages global sponsorships and other opportunities. We will continue to invest aggressively in marketing, particularly in Europe and North America, to increase our presence in each market and further increase the synergistic effects of our investments. In addition, we will work to enhance our brand value through various approaches, such as expanding our product lineup to include non-alcohol beer and other extension products. In the area of BACs^*, where market expansion is expected, we plan to first focus on raising recognition and expanding our contribution to business performance.

BACs: Beer Adjacent Categories
Categories adjacent to beer, such as RTD low alcohol beverages, non-alcohol beer taste beverages, and adult soft drinks

A.In the countries in which we have major operations, we expect the scale of investment to increase further to improve our competitive advantage. In the Alcohol Beverages Business in Japan, we have continued to make high-quality investments over the past two years, which have produced positive results, and we will continue to invest to maintain and expand our strong position. In addition, we have been able to build a very strong business foundation in Australia and the Czech Republic in Europe, and we will continue our efforts to further strengthen our competitive advantage in other countries.

A.We are hedging on a multi-year basis and market prices for some items continue to rise. In addition, processing costs may soften in Europe going forward, while they may rise in Japan. Furthermore, the Australian Dollar and Japanese Yen remain weak against the US Dollar. Given these factors, even if prices fall in Europe next fiscal year, they may not fall significantly in Japan and Oceania, and the Group overall may not be able to make significant cost reductions.

A.We expect that the establishment of Asahi Global Procurement will generate an average financial benefit of more than US$100M per year over a five-year period starting in 2024. However, the number of benefits will be lower than average in the next fiscal year as it is the first year of its establishment. Part of these generated effects will be used to invest in marketing, DX, IT, sustainability, human resources, and other areas for future growth. Therefore, since the effects of boosting profits in the short term will be limited, we envision high single digit CAGR growth in Core Operating Profit for the next fiscal year.

A.Until now, product development and marketing efforts have been carried out locally on a regional basis. However, as the group has been able to share best practices internally, initiatives at the global level have been increasing, for example, new products utilizing the advanced dealcoholization technology developed in Japan are being rolled out in various countries. We will continue to develop a variety of attractive products, including BACs. In addition, while utilizing the investment management company established in the U.S., we aim to create further global-level synergies in the top line by combining various seeds and ideas.

A.Some companies are selling beer at lower prices, but the market has not fallen into excessive price competition. In addition, there was a risk of a demand shift from beer to new genres in last year's price revision, but the shift to beer, which has been ongoing since October 2020, has been steady. In the first half of the year, our canned beer sales fell short of our plan, but we have a good trend toward the peak summer season and will continue to strengthen "Asahi Super Dry" and "Asahi Nama Beer". We also plan to launch new products that will create new demand and new categories to establish a dominant position in the beer market after the liquor tax revision. There will be no change in our beer-centered strategy, but we will continue to make certain investments in happoshu and new genres with a narrowing of brands, while keeping an eye on the overall portfolio.

A.Over the past year and a half, we have suffered from rising costs. However, we are confident that we have been able to achieve results by closely sharing the status of raw material and energy price realizations between the regions and the global headquarters, and by implementing strategies based on marketing and Revenue Growth Management. In particular, we believe that the continued implementation of a strategy that focuses on brand value enhancement, without slackening marketing investment, has led to successful results in each region and will lead to growth in the medium to long term. We have been able to stimulate and enhance each other's efforts with management in Europe and Oceania, and we continue to have a very good relationship with them.

A.In Europe, price increases were implemented at levels never experienced before, but we do not believe that there will be a significant negative impact on consumption, given the relatively low unit price of beer in the Eastern European area. In some countries, consumption tends to decrease significantly when the economic environment worsens, but also recovers quickly, and we do not believe that the situation will be pessimistic if appropriate category strategies are chosen.
The unit price of beer is higher in Australia than in Japan, a market where prices have continuously risen in tandem with the CPI. In this market, we have been able to increase both price and brand value at the same time, creating a competitive advantage in terms of brand strength and other factors.
Although both regions are not markets where large volume growth can be expected in the future, we believe that we can continue to achieve sustainable top-line growth and profitability.

A.In the next fiscal year, if inflation is expected to settle down, the extent of price increases will become more moderate. In that case, we believe that demand, which has declined due to the current economic uncertainty, will return to a certain degree. Even if inflation subsides, we will continue to pursue our premium strategy without lowering prices. We hope to return to the profit level before the COVID over the next few years.

A.We were able to create integration synergies with CUB ahead of schedule. The next step is to implement the transformation of the entire business. We expect to achieve a certain scale of results by around 2025, and the profits generated will be reallocated to various investments to solidify the foundation for future growth. The profits generated will be reallocated to various investments to solidify the foundation for future growth.

A. The market decreased in the April-June period, but the analysis indicates that this was largely due to the timing of Easter being staggered between this year and last year. In addition, the weather was bad in April, causing inventory to stagnate. However, the market has been recovering since May. Although macroeconomic indicators in Australia are not good, beer consumption is stable at this point. We will need to continue to monitor the situation closely, but we believe that the impact of inflation on consumption will be limited.
We expect volume growth in the market to be flat to slightly higher than the previous year, and we will work to outperform the market. Based on our multi-beverage strategy, we believe that we can sustain the strong performance of "Asahi Super Dry" and "Peroni Nastro Azzurro" as well as craft beers, with "Great Northern" as the core.