News Release

Suntory Beer Limited Business Strategy for 2017

Suntory Beer Limited conducts business based on its company vision of "bringing excitement with outstanding taste." In 2016, Suntory endeavored to create new flavors and drinking situations with the launch of The Premium Malt's Kaoru Ale as an ale beer suitable for Japanese tastes, and the proposal of All-Free as a way of enjoying the taste of beer casually even during the daytime. In 2017, we will continue to pursue high-quality, good flavor with all earnestness, while also taking on the challenge of innovation including the generation of new contact points with consumers.

● Review of 2016
The total market for the beer category in Japan^*1 in 2016 was estimated to shrink about 2% from the previous year. Under these circumstances, Suntory Beer Limited had total sales of 71.65 million cases^*2 (down 3% year-on-year), as the sales volume was in line with the market size. Sales of the beer category, excluding non-alcoholic beer-type beverages, totaled 64.61 million cases (down 3% year-on-year).
For The Premium Malt's, Suntory strongly emphasized the focus on ingredients and quality, and stimulate demand for premium beer on Fridays and other days before work holidays under the key message of "Make Fridays great.” Launched as an ale beer suitable for Japanese tastes, The Premium Malt's Kaoru Ale proved popular with its fruity flavor as 2.3 million cases were sold. New demand was captured for The Premium Malt's brand among consumers like women and young people who had no contact with the brand before as they were offered the opportunity to enjoy the brand.
For the Kin-Mugi brand, record high sales levels were achieved for both Kin-Mugi that highlights the taste of barley and Kin-Mugi (75% Less Sugar^*3) that is delicious, yet low in carbohydrates. 36.66 million cases (on par with the previous year) were sold for the entire brand.
For the All-Free brand, 6.95 million cases (on par with the previous year) were sold as a result of proactive marketing activities including communication activities to stimulate drinking during the day and the renewal of the All-Free Collagen product.

*1 Includes happoshu, new-genre beer, and non-alcoholic beer-type beverages

*2 One case is equivalent to twenty large (633 mL) bottles

*3 Compared to Suntory's Kin-Mugi

●Strategy for 2017
The total market for the beer category in Japan and the beer market in Japan excluding the non-alcoholic beverages is forecast to shrink by about 2% from the previous year. Suntory Beer Limited will further bolster marketing activities related to the three core brands of The Premium Malt's, Kin-Mugi, and All-Free to stimulate new demand and provide added impetus to the beer market. Suntory Beer Limited's goal is to sell 72.7 million cases (up 1% year-on-year) with the aim of selling 65.5 million cases (up 1% year-on-year) in the beer category.

▼The Premium Malt's
Suntory Beer Limited will reform the contents and package of The Premium Malt's in an aim to sell 17.70 million cases (up 3% year-on-year). As a leading brand and driving force of the premium beer market, we will take a stronger initiative in stimulating new demand for premium beer.

▽The Premium Malt's
The Premium Malt's will be relaunched after a renewal on March 14, Tuesday. Its contents were refined to offer an even more overflowing flowery aroma and the enjoyment of a richer flavor, lasting from when the customer starts to drink until they are finished. A package design that stresses more of a sense of luxury was adopted by boldly placing the phrase "The PREMIUM" in large letters in the center of the can. The draft keg will be released in advance, using the product that is produced in early February. It will be possible to enjoy the renewed The Premium Malt's at Premium Friday events that will be held from the end of February at restaurants and bars.
In an aim to maximize demand for The Premium Malt's, promotions will be held based on the theme of enjoying overpowering deliciousness.

▽The Premium Malt's Kaoru Ale
The popular fruity flavor will be kept as is while renewing the aftertaste so that it tastes more refreshing and more favorable by revising the brewing process. In the package, a light and airy quality is expressed with the vivid sky blue colors. It will be newly launched nationwide in Japan from April 11 in an aim for the further penetration of ale beer in Japan's beer market.

▼Kin-Mugi
The target is to sell 37.50 million cases (up 2% year-on-year) for the Kin-Mugi brand.
Favorably received for its focus on the taste of barley, Kin-Mugi was renewed in December 2016 so that customers could better enjoy the characteristics of the contents. Furthermore, June will mark the tenth anniversary since the launch of Kin-Mugi. We will proactively pursue communication activities thanking customers that have supported this brand up until now by communicating the key message of "Thank you for the past, and thank you for the future. 10 years with Kin-Mugi."
For Kin-Mugi (75% Less Sugar), we aim to further increase demand through activities such as a campaign from January.

▼Non-alcoholic beer-type beverage All-Free
The target is to sell 7.2 million cases (up 4% year-on-year) for the All-Free brand. A renewal will be implemented for All-Free, with the features that achieved 0.00% alcohol, zero calories^*4, zero carbohydrates^*5 and zero purine^*6 left unchanged, while reinforcing the flavor to make it even more like beer. The product will be newly launched gradually nationwide using the product that is produced in mid-January.
The contents of All-Free Collagen were renewed in December 2016 to better emphasize the refreshing and fruity flavor.
We will introduce new television commercials and work to further expand drinking situations through means such as proposing enjoying the taste of beer even during the daytime.

*4 Based on the Nutrition Labeling Standards, less than 5 kcal of calories per 100 mL is considered zero calories.

*5 Based on the Nutrition Labeling Standards, less than 0.5 g of carbohydrates per 100 mL is considered zero carbohydrates.

*6 Less than 0.5 mg of purines per 100 mL is considered zero purine.