KEY POINTS ABOUT KIRIN

• Business Structure / Earnings Structure
• Kirin's History of Progress

Business Structure

The Kirin Group is centered on Kirin Holdings, a pure holding company. In markets around the world, the Group conducts business in the domains of "food and well-being." The Kirin Group has two business segments—the Integrated Beverages Business, which provides alcoholic beverages and non-alcoholic beverages, and the Pharmaceuticals and Bio-chemicals Business. The Integrated Beverages Business provides comparatively high stability, while the Pharmaceuticals and Bio-chemicals Business offers strong growth potential. With these two business segments, Kirin has established a well-balanced business portfolio that can effectively support sustained growth for the Group as a whole. Moving forward, the Group's growth driver will be the realization of social value creation through initiatives that address well-being and other social issues in these business fields. On that basis, the Kirin Group will strive to achieve sustained growth.

Earnings Structure

The composition of the Kirin Group's consolidated operating income by business segment is extremely well balanced. On the foundation provided by this earnings structure, the Group has determined the strategic direction for each operating company from the viewpoints of market growth potential and earnings potential. The alcoholic beverages businesses of Kirin Brewery and Lion, which have large operational scales and high profitability, support the earnings of the Kirin Group. Accordingly, in these businesses the Group will implement marketing investment to reinforce their earnings foundations. Kyowa Hakko Kirin, the operating company of the pharmaceuticals and bio-chemicals business, contributes 36% of consolidated operating income. In these businesses, Kyowa Hakko Kirin will implement aggressive investment in R&D to make a "leap" over the medium to long term. On the other hand, for Brasil Kirin, Kirin Beverage, and Lion dairy and drinks business, which have low profitability, the Group will limit capital expenditures and give priority to increasing profitability through the acceleration of structural reforms. Kirin Holdings will work together with the operating companies to implement strategies. In addition, by fostering a finely tuned allocation of management resources, Kirin Holdings will enhance the Group's earnings capacity, leading to sustainable growth.

Contribution to Consolidated Operating Income by Business Segment

Operational Scale and Profitability by Major Business