LIST OF CONTENTS AND TABLES

Transcription

1

2 LIST OF CONTENTS AND TABLES Soft Drinks in South Korea - Industry Overview... 1 Executive Summary... 1 Premiumisation Leads Healthy Growth... 1 Health and Wellness Continues To Attract Consumers... 1 Two Leading Companies Maintain Positions... 1 sparkling Becomes Popular... 1 Soft Drinks Will See Rapid Growth But Rapid Change... 2 Key Trends and Developments... 2 Premiumisation Continues To Drive Growth... 2 sparkling Well Received by South Korean Consumers... 3 Leading Players Remain in Strong Positions... 4 Specialist Coffee Shops the Entry Channel for Premium Soft Drinks... 5 Marketing Strategies Through Smartphones Become Active... 6 Market Data... 7 Table 1 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Channel: Volume Table 2 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Channel: % Volume Growth Table 3 Off-trade vs On-trade Sales of Soft Drinks by Channel: Value Table 4 Off-trade vs On-trade Sales of Soft Drinks by Channel: % Value Growth Table 5 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Category: Volume Table 6 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Category: % Volume Table 7 Off-trade vs On-trade Sales of Soft Drinks by Category: Value Table 8 Off-trade vs On-trade Sales of Soft Drinks by Category: % Value Table 9 Off-trade Sales of Soft Drinks (as sold) by Category: Volume Table 10 Off-trade Sales of Soft Drinks (as sold) by Category: % Volume Growth Table 11 Off-trade Sales of Soft Drinks by Category: Value Table 12 Off-trade Sales of Soft Drinks by Category: % Value Growth Table 13 Company Shares of Off-trade Soft Drinks (as sold) by Volume Table 14 Brand Shares of Off-trade Soft Drinks (as sold) by Volume Table 15 Company Shares of Off-trade Soft Drinks (RTD) by Volume Table 16 Brand Shares of Off-trade Soft Drinks (RTD) by Volume Table 17 Company Shares of Off-trade Soft Drinks by Value Table 18 Brand Shares of Off-trade Soft Drinks by Value Table 19 Off-trade Sales of Soft Drinks by Category and Distribution Format: % Analysis Table 20 Forecast Off-trade vs On-trade Sales of Soft Drinks (as sold) by Channel: Volume

3 Table 21 Forecast Off-trade vs On-trade Sales of Soft Drinks (as sold) by Channel: % Volume Growth Table 22 Forecast Off-trade vs On-trade Sales of Soft Drinks by Channel: Value Table 23 Forecast Off-trade vs On-trade Sales of Soft Drinks by Channel: % Value Growth Table 24 Forecast Off-trade Sales of Soft Drinks (as sold) by Category: Volume Table 25 Forecast Off-trade Sales of Soft Drinks (as sold) by Category: % Volume Growth Table 26 Forecast Off-trade Sales of Soft Drinks by Category: Value Table 27 Forecast Off-trade Sales of Soft Drinks by Category: % Value Growth Appendix Fountain Sales in South Korea Data Table 28 Off-trade vs On-trade Fountain Sales of Soft Drinks: Volume Table 29 Off-trade vs On-trade Fountain Sales of Soft Drinks: % Volume Growth Table 30 Off-trade vs On-trade Fountain Sales of Carbonates: Volume Table 31 Off-trade vs On-trade Fountain Sales of Carbonates: % Volume Growth Table 32 Forecast Off-trade vs On-trade Fountain Sales of Soft Drinks: Volume Table 33 Forecast Off-trade vs On-trade Fountain Sales of Soft Drinks: % Volume Growth Table 34 Forecast Off-trade vs On-trade Fountain Sales of Carbonates: Volume Table 35 Forecast Off-trade vs On-trade Fountain Sales of Carbonates: % Volume Growth Definitions Summary 1 Research Sources Soft Drinks in South Korea - Company Profiles Dong-a Otsuka Co Ltd in Soft Drinks (south Korea) Strategic Direction Key Facts Summary 2 Dong-A Otsuka Co Ltd: Key Facts Summary 3 Dong-A Otsuka Co Ltd: Operational Indicators Company Background Production Competitive Positioning Summary 4 Dong-A Otsuka Co Ltd: Competitive Position Haitai Beverage Co Ltd in Soft Drinks (south Korea) Strategic Direction Key Facts... 27

4 Summary 5 Haitai Beverage Co Ltd: Key Facts Summary 6 Haitai Beverage Co Ltd: Operational Indicators Company Background Production Summary 7 Haitai Beverage Co Ltd: Production Statistics Competitive Positioning Summary 8 Haitai Beverage Co Ltd: Competitive Position Lotte Chilsung Beverage Co Ltd in Soft Drinks (south Korea) Strategic Direction Key Facts Summary 9 Lotte Chilsung Beverage Co Ltd: Key Facts Summary 10 Lotte Chilsung Beverage Co Ltd: Operational Indicators Company Background Production Summary 11 Lotte Chilsung Beverage Co Ltd: Production Statistics Competitive Positioning Summary 12 Lotte Chilsung Beverage Co Ltd: Competitive Position Woongjin Food Co Ltd in Soft Drinks (south Korea) Strategic Direction Key Facts Summary 13 Woongjin Food Co Ltd: Key Facts Summary 14 Woongjin Food Co Ltd: Operational Indicators Company Background Production Summary 15 Woongjin Food Co Ltd: Production Statistics Competitive Positioning Summary 16 Woongjin Food Co Ltd: Competitive Position Bottled Water in South Korea - Category analysis Headlines Trends Competitive Landscape Prospects Category Data Institutional Bottled Water Sales Table 36 Sales of Bottled Water to Institutional Channel Table 37 Off-trade Sales of Bottled Water: Volume Table 38 Off-trade Sales of Bottled Water: Value Table 39 Off-trade Sales of Bottled Water: % Volume Growth Table 40 Off-trade Sales of Bottled Water: % Value Growth Table 41 Company Shares of Bottled Water by Off-trade Volume Table 42 Brand Shares of Bottled Water by Off-trade Volume Table 43 Company Shares of Bottled Water by Off-trade Value Table 44 Brand Shares of Bottled Water by Off-trade Value Table 45 Forecast Off-trade Sales of Bottled Water: Volume Table 46 Forecast Off-trade Sales of Bottled Water: Value

5 Table 47 Forecast Off-trade Sales of Bottled Water: % Volume Growth Table 48 Forecast Off-trade Sales of Bottled Water: % Value Growth Carbonates in South Korea - Category analysis Headlines Trends Competitive Landscape Prospects Category Data Table 49 Low Calorie Carbonates by Subsector Table 50 Off-trade Sales of Carbonates by Category: Volume Table 51 Off-trade Sales of Carbonates by Category: Value Table 52 Off-trade Sales of Carbonates by Category: % Volume Growth Table 53 Off-trade Sales of Carbonates by Category: % Value Growth Table 54 On-trade vs Off-trade Sales of Carbonates: Volume Table 55 On-trade vs Off-trade Sales of Carbonates: Value Table 56 On-trade vs Off-trade Sales of Carbonates: % Volume Growth Table 57 On-trade vs Off-trade Sales of Carbonates: % Value Growth Table 58 Off-trade Sales of Low Calorie Cola Carbonates by Category: % Volume Breakdown Table 59 Company Shares of Carbonates by Off-trade Volume Table 60 Brand Shares of Carbonates by Off-trade Volume Table 61 Company Shares of Carbonates by Off-trade Value Table 62 Brand Shares of Carbonates by Off-trade Value Table 63 Forecast Off-trade Sales of Carbonates by Category: Volume Table 64 Forecast Off-trade Sales of Carbonates by Category: Value Table 65 Forecast Off-trade Sales of Carbonates by Category: % Volume Growth Table 66 Forecast Off-trade Sales of Carbonates by Category: % Value Growth Concentrates in South Korea - Category analysis Headlines Trends Competitive Landscape Prospects Category Data Concentrates Conversions Table 67 Concentrates Conversion Factors for Ready-to-Drink (RTD) Format Table 68 Off-trade Sales of Concentrates (as sold) by Category: Volume Table 69 Off-trade Sales of Concentrates (as sold) by Category: % Volume Growth

6 Table 70 Off-trade Sales of Concentrates (RTD) by Category: Volume Table 71 Off-trade Sales of Concentrates (RTD) by Category: % Volume Growth Table 72 Off-trade Sales of Concentrates by Category: Value Table 73 Off-trade Sales of Concentrates by Category: % Value Growth Table 74 Company Shares of Powder Concentrates (as sold) by Off-trade Volume Table 75 Brand Shares of Powder Concentrates (as sold) by Off-trade Volume Table 76 Company Shares of Concentrates (RTD) by Off-trade Volume Table 77 Brand Shares of Concentrates (RTD) by Off-trade Volume Table 78 Company Shares of Concentrates by Off-trade Value Table 79 Brand Shares of Concentrates by Off-trade Value Table 80 Forecast Off-trade Sales of Concentrates (as sold) by Category: Volume Table 81 Forecast Off-trade Sales of Concentrates (as sold) by Category: % Volume Growth Table 82 Forecast Off-trade Sales of Concentrates (RTD) by Category: Volume Table 83 Forecast Off-trade Sales of Concentrates (RTD) by Category: % Volume Growth Table 84 Forecast Off-trade Sales of Concentrates by Category: Value Table 85 Forecast Off-trade Sales of Concentrates by Category: % Value Growth Fruit/vegetable Juice in South Korea - Category analysis Headlines Trends Competitive Landscape Prospects Category Data Table 86 Off-trade Sales of Fruit/Vegetable Juice by Category: Volume Table 87 Off-trade Sales of Fruit/Vegetable Juice by Category: Value Table 88 Off-trade Sales of Fruit/Vegetable Juice by Category: % Volume Growth Table 89 Off-trade Sales of Fruit/Vegetable Juice by Category: % Value Growth Table 90 Leading Flavours for 100% Juice: % Volume Breakdown Table 91 Leading Flavours for Nectars (25-99% Juice): % Volume Breakdown Table 92 Leading Flavours for Juice Drinks (up to 24% Juice): % Volume Breakdown Table 93 % Share of Smoothies in 100% Juice and Nectars (25-99% Juice): Off-trade Value Table 94 Chilled Vs Ambient Reconstituted 100% Juice: % Analysis

7 Table 95 Company Shares of Fruit/Vegetable Juice by Off-trade Volume Table 96 Brand Shares of Fruit/Vegetable Juice by Off-trade Volume Table 97 Company Shares of Fruit/Vegetable Juice by Off-trade Value Table 98 Brand Shares of Fruit/Vegetable Juice by Off-trade Value Table 99 Forecast Off-trade Sales of Fruit/Vegetable Juice by Category: Volume Table 100 Forecast Off-trade Sales of Fruit/Vegetable Juice by Category: Value Table 101 Forecast Off-trade Sales of Fruit/Vegetable Juice by Category: % Volume Growth Table 102 Forecast Off-trade Sales of Fruit/Vegetable Juice by Category: % Value Growth Rtd Coffee in South Korea - Category analysis Headlines Trends Competitive Landscape Prospects Category Data Table 103 Off-trade Sales of RTD Coffee: Volume Table 104 Off-trade Sales of RTD Coffee: Value Table 105 Off-trade Sales of RTD Coffee: % Volume Growth Table 106 Off-trade Sales of RTD Coffee: % Value Growth Table 107 Company Shares of RTD Coffee by Off-trade Volume Table 108 Brand Shares of RTD Coffee by Off-trade Volume Table 109 Company Shares of RTD Coffee by Off-trade Value Table 110 Brand Shares of RTD Coffee by Off-trade Value Table 111 Forecast Off-trade Sales of RTD Coffee: Volume Table 112 Forecast Off-trade Sales of RTD Coffee: Value Table 113 Forecast Off-trade Sales of RTD Coffee: % Volume Growth Table 114 Forecast Off-trade Sales of RTD Coffee: % Value Growth Rtd Tea in South Korea - Category analysis Headlines Trends Competitive Landscape Prospects Category Data Table 115 Off-trade Sales of RTD Tea by Category: Volume Table 116 Off-trade Sales of RTD Tea by Category: Value Table 117 Off-trade Sales of RTD Tea by Category: % Volume Growth Table 118 Off-trade Sales of RTD Tea by Category: % Value Growth Table 119 Leading Flavours for RTD Tea: % Volume Breakdown Table 120 Company Shares of RTD Tea by Off-trade Volume Table 121 Brand Shares of RTD Tea by Off-trade Volume Table 122 Company Shares of RTD Tea by Off-trade Value

8 Table 123 Brand Shares of RTD Tea by Off-trade Value Table 124 Forecast Off-trade Sales of RTD Tea by Category: Volume Table 125 Forecast Off-trade Sales of RTD Tea by Category: Value Table 126 Forecast Off-trade Sales of RTD Tea by Category: % Volume Growth Table 127 Forecast Off-trade Sales of RTD Tea by Category: % Value Growth Sports and Energy Drinks in South Korea - Category analysis Headlines Trends Competitive Landscape Prospects Category Data Table 128 Still vs Carbonated Sports and Energy Drinks % Off-trade Volume Table 129 Off-trade Sales of Sports and Energy Drinks by Category: Volume Table 130 Off-trade Sales of Sports and Energy Drinks by Category: Value Table 131 Off-trade Sales of Sports and Energy Drinks by Category: % Volume Growth Table 132 Off-trade Sales of Sports and Energy Drinks by Category: % Value Growth Table 133 Company Shares of Sports and Energy Drinks by Off-trade Volume Table 134 Brand Shares of Sports and Energy Drinks by Off-trade Volume Table 135 Company Shares of Sports and Energy Drinks by Off-trade Value Table 136 Brand Shares of Sports and Energy Drinks by Off-trade Value Table 137 Forecast Off-trade Sales of Sports and Energy Drinks by Category: Volume Table 138 Forecast Off-trade Sales of Sports and Energy Drinks by Category: Value Table 139 Forecast Off-trade Sales of Sports and Energy Drinks by Category: % Volume Growth Table 140 Forecast Off-trade Sales of Sports and Energy Drinks by Category: % Value Growth Asian Speciality Drinks in South Korea - Category analysis Headlines Trends Competitive Landscape Prospects Category Data Table 141 Off-trade Sales of Asian Speciality Drinks by Category: Volume

9 Table 142 Off-trade Sales of Asian Speciality Drinks by Category: Value Table 143 Off-trade Sales of Asian Speciality Drinks by Category: % Volume Growth Table 144 Off-trade Sales of Asian Speciality Drinks by Category: % Value Growth Table 145 Company Shares of Asian Speciality Drinks by Off-trade Volume Table 146 Brand Shares of Asian Speciality Drinks by Off-trade Volume Table 147 Company Shares of Asian Speciality Drinks by Off-trade Value Table 148 Brand Shares of Asian Speciality Drinks by Off-trade Value Table 149 Forecast Off-trade Sales of Asian Speciality Drinks by Category: Volume Table 150 Forecast Off-trade Sales of Asian Speciality Drinks by Category: Value Table 151 Forecast Off-trade Sales of Asian Speciality Drinks by Category: % Volume Growth Table 152 Forecast Off-trade Sales of Asian Speciality Drinks by Category: % Value Growth

10 SOFT DRINKS IN SOUTH KOREA - INDUSTRY OVERVIEW EXECUTIVE SUMMARY Premiumisation Leads Healthy Growth In 2010, soft drinks experienced healthy growth, registering a 6% increase in off-trade value sales and a 5% increase in off-trade volume sales, thanks to a premiumisation trend, especially within bottled water, fruit/vegetable juice, carbonates and RTD coffee. Imported and premium brands of bottled water, carbonated bottled water and fruit/vegetable juice recorded healthy growth rates. In the case of fruit/vegetable juice, the category continued to see declining volume sales but imported premium juice expanded its presence in South Korea. New flavours of carbonates and renewed brands without sugar and preservatives were also popular launches. However, RTD tea and Asian speciality drinks showed volume declines as they fell out of fashion. Health and Wellness Continues To Attract Consumers With the growing health and wellness trend, healthy concepts remained popular among South Korean consumers. In particular, various vitamins have been used to target different consumer groups and manufacturers have highlighted the varied functions of different vitamins in their products, targeting sophisticated South Korean consumers. Vitamin B has been marketed for its anti-ageing properties. Vitamin C and collagen remained among the favourite ingredients for skin health. At the same time, manufacturers tried to strengthen healthy brands through advertising, the shape of packaging and using brand names to appeal to a sophisticated South Korean consumer base. Two Leading Companies Maintain Positions Lotte Chilsung Beverage Co Ltd and Coca-Cola Korea Co maintained the two leading positions in 2010, accounting for a 48% combined share in off-trade value terms. Lotte Chilsung remained in the leading position with 33% of off-trade value sales in The company strengthened its product portfolio, launching premium fruit/vegetable juice and sports drinks and renewing its well-known carbonates and flavoured bottled water lines, recording a positive growth rate although a decline in share. Coca-Cola Korea also introduced a smaller version of its Coca-Cola brand, Mini Coke, which proved popular among younger consumers. sparkling Becomes Popular In 2010, sparkling was a popular concept within soft drinks. South Koreans generally perceive sparkling drinks to be less healthy, a traditional perception associated with carbonates. However, carbonates have seen continued positive growth since 2008, despite the health and wellness trend. Growing numbers of South Korean consumers looking for refreshing carbonated options in soft drinks have become apparent. New product developments, presented as sparkling versions of fruit/vegetable juice and RTD tea, were introduced during Carbonated bottled water experienced strong growth in Furthermore, manufacturers offered health-positioned drinks in a carbonated format to attract consumers who are sensitive to their health needs.

11 Soft Drinks Will See Rapid Growth But Rapid Change Content removed from sample KEY TRENDS AND DEVELOPMENTS Premiumisation Continues To Drive Growth Content removed from sample Current Impact Content removed from sample Outlook Content removed from sample

12 Content removed from sample Future Impact Content removed from sample sparkling Well Received by South Korean Consumers Content removed from sample Current Impact Content removed from sample Outlook Content removed from sample

13 Content removed from sample Future Impact Content removed from sample Leading Players Remain in Strong Positions Content removed from sample Current Impact Content removed from sample Outlook Content removed from sample

14 Content removed from sample Future Impact Content removed from sample Specialist Coffee Shops the Entry Channel for Premium Soft Drinks Content removed from sample Current Impact Content removed from sample Outlook Content removed from sample

15 Future Impact Content removed from sample Marketing Strategies Through Smartphones Become Active Content removed from sample Current Impact Content removed from sample Outlook Content removed from sample Future Impact Content removed from sample

16 MARKET DATA Table 1 million litres OFF-trade ON-trade Total Off-trade vs On-trade Sales of Soft Drinks (as sold) by Channel: Volume Note: Excludes powder concentrates Table 2 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Channel: % Volume Growth % volume growth OFF-trade ON-trade Total 2009/ CAGR 2005/10 TOTAL Note: Excludes powder concentrates Table 3 Off-trade vs On-trade Sales of Soft Drinks by Channel: Value Won billion OFF-trade ON-trade Total Table 4 Off-trade vs On-trade Sales of Soft Drinks by Channel: % Value Growth % current value growth OFF-trade ON-trade Total 2009/ CAGR 2005/10 TOTAL

17 Table 5 million litres Off-trade vs On-trade Sales of Soft Drinks (as sold) by Category: Volume 2010 Off-trade On-trade TOTAL Bottled Water Carbonates Concentrates Fruit/Vegetable Juice RTD Coffee RTD Tea Sports and Energy Drinks Asian Speciality Drinks Soft Drinks Note: Excludes powder concentrates Table 6 Off-trade vs On-trade Sales of Soft Drinks (as sold) by Category: % Volume 2010 % volume analysis Bottled Water Carbonates Concentrates Fruit/Vegetable Juice RTD Coffee RTD Tea Sports and Energy Drinks Asian Speciality Drinks Soft Drinks Off-trade On-trade Total Note: Excludes powder concentrates Table 7 Off-trade vs On-trade Sales of Soft Drinks by Category: Value 2010 Won billion Bottled Water Carbonates Concentrates Fruit/Vegetable Juice RTD Coffee RTD Tea Sports and Energy Drinks Asian Speciality Drinks Soft Drinks Off-trade On-trade TOTAL

18 Table 8 Off-trade vs On-trade Sales of Soft Drinks by Category: % Value 2010 % value analysis Bottled Water Carbonates Concentrates Fruit/Vegetable Juice RTD Coffee RTD Tea Sports and Energy Drinks Asian Speciality Drinks Soft Drinks Off-trade On-trade Total Table 9 Off-trade Sales of Soft Drinks (as sold) by Category: Volume million litres Bottled Water Carbonates Concentrates Fruit/Vegetable Juice RTD Coffee RTD Tea Sports and Energy Drinks Asian Speciality Drinks Soft Drinks Note: Excludes powder concentrates Table 10 Off-trade Sales of Soft Drinks (as sold) by Category: % Volume Growth % volume growth Bottled Water Carbonates Concentrates Fruit/Vegetable Juice RTD Coffee RTD Tea Sports and Energy Drinks Asian Speciality Drinks Soft Drinks 2009/ CAGR 2005/10 TOTAL Note: Excludes powder concentrates Table 11 Off-trade Sales of Soft Drinks by Category: Value

19 Won billion Bottled Water Carbonates Concentrates Fruit/Vegetable Juice RTD Coffee RTD Tea Sports and Energy Drinks Asian Speciality Drinks Soft Drinks Table 12 Off-trade Sales of Soft Drinks by Category: % Value Growth % current value growth Bottled Water Carbonates Concentrates Fruit/Vegetable Juice RTD Coffee RTD Tea Sports and Energy Drinks Asian Speciality Drinks Soft Drinks 2009/ CAGR 2005/10 TOTAL Table 13 Company Shares of Off-trade Soft Drinks (as sold) by Volume % off-trade volume Company

20 Total Note: Excludes powder concentrates Table 14 Brand Shares of Off-trade Soft Drinks (as sold) by Volume % off-trade volume Brand Company

21 Total Note: Excludes powder concentrates Table 15 Company Shares of Off-trade Soft Drinks (RTD) by Volume % off-trade volume Company Others Total

22 Table 16 Brand Shares of Off-trade Soft Drinks (RTD) by Volume % off-trade volume Brand Company

23 Total Table 17 Company Shares of Off-trade Soft Drinks by Value % off-trade value rsp Company Total Table 18 Brand Shares of Off-trade Soft Drinks by Value % off-trade value rsp Brand Company

24 Others Total Table 19 Off-trade Sales of Soft Drinks by Category and Distribution Format: % Analysis 2010

25 % off-trade BW C Con F/VJ RTD C RTD T Store-Based Retailing Grocery Retailers Supermarkets/Hypermarkets Discounters Small Grocery Retailers Convenience Stores Independent Small Grocers Forecourt Retailers Other Grocery Retailers Non-Grocery Retailers Non-Store Retailing Vending Homeshopping Internet Retailing Direct Selling Total SED ASD Store-Based Retailing Grocery Retailers Supermarkets/Hypermarkets Discounters Small Grocery Retailers Convenience Stores Independent Small Grocers Forecourt Retailers Other Grocery Retailers Non-Grocery Retailers Non-Store Retailing Vending Homeshopping Internet Retailing Direct Selling Total Key: Note: BW = bottled water; C = carbonates; Con = concentrates; F/VJ = fruit/vegetable juice; RTD C = RTD coffee; RTD T = RTD tea; SED = sports and energy drinks; ASD = Asian speciality drinks Excludes powder concentrates Table 20 Forecast Off-trade vs On-trade Sales of Soft Drinks (as sold) by Channel: Volume million litres OFF-trade ON-trade Total Note: Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Excludes powder concentrates

26 Table 21 Forecast Off-trade vs On-trade Sales of Soft Drinks (as sold) by Channel: % Volume Growth % volume growth OFF-trade ON-trade Total 2014/ CAGR 2010/15 TOTAL Note: Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Excludes powder concentrates Table 22 Forecast Off-trade vs On-trade Sales of Soft Drinks by Channel: Value Won billion OFF-trade ON-trade Total Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 23 Forecast Off-trade vs On-trade Sales of Soft Drinks by Channel: % Value Growth % current value growth OFF-trade ON-trade Total 2014/ CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 24 Forecast Off-trade Sales of Soft Drinks (as sold) by Category: Volume million litres Bottled Water Carbonates Concentrates Fruit/Vegetable Juice RTD Coffee RTD Tea Sports and Energy Drinks Asian Speciality Drinks Soft Drinks Note: Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Excludes powder concentrates

27 Table 25 % volume growth Forecast Off-trade Sales of Soft Drinks (as sold) by Category: % Volume Growth / CAGR 2010/15 TOTAL Bottled Water Carbonates Concentrates Fruit/Vegetable Juice RTD Coffee RTD Tea Sports and Energy Drinks Asian Speciality Drinks Soft Drinks Note: Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Excludes powder concentrates Table 26 Forecast Off-trade Sales of Soft Drinks by Category: Value Won billion Bottled Water Carbonates Concentrates Fruit/Vegetable Juice RTD Coffee RTD Tea Sports and Energy Drinks Asian Speciality Drinks Soft Drinks Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 27 Forecast Off-trade Sales of Soft Drinks by Category: % Value Growth % constant value growth Bottled Water Carbonates Concentrates Fruit/Vegetable Juice RTD Coffee RTD Tea Sports and Energy Drinks Asian Speciality Drinks Soft Drinks CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

28 APPENDIX Fountain Sales in South Korea Trends Fountain sales continued positive growth in on-trade volume terms while fountain on-trade volume sales through convenience stores declined during In South Korea, most fountain sales occurred in the foodservice channel, which accounted for a 97% share of total fountain volume sales in Fountain sales through convenience stores tend to be subject to seasonality, with demand being higher in summer. As such, few convenience stores offer fountain sales for soft drinks in South Korea. In addition, most convenience stores are limited in their selling space, making it increasingly difficult to site the fountains on the premises. Only a small number around school zones tend to offer fountain sales. Content removed from sample DATA Table 28 Off-trade vs On-trade Fountain Sales of Soft Drinks: Volume million litres OFF-trade ON-trade Fountain ON-trade volume through c-store Fountain ON-trade volume through food store Total fountain ON-trade volume Total

29 Note: Total fountain on-trade volume data included in on-trade Table 29 Off-trade vs On-trade Fountain Sales of Soft Drinks: % Volume Growth % fountain volume growth OFF-trade ON-trade Fountain ON-trade volume through c-store Fountain ON-trade volume through food store Total fountain ON-trade volume Total 2009/ CAGR 2005/10 TOTAL Note: Total fountain on-trade volume data included in on-trade Table 30 Off-trade vs On-trade Fountain Sales of Carbonates: Volume million litres OFF-trade ON-trade Fountain ON-trade volume through c-store Fountain ON-trade volume through food store Total fountain ON-trade volume Total Note: Total fountain on-trade volume data included in on-trade Table 31 Off-trade vs On-trade Fountain Sales of Carbonates: % Volume Growth % fountain volume growth OFF-trade ON-trade Fountain ON-trade volume through c-store Fountain ON-trade volume through food store Total fountain ON-trade volume Total 2009/ CAGR 2005/10 TOTAL Note: Total fountain on-trade volume data included in on-trade

30 Table 32 Forecast Off-trade vs On-trade Fountain Sales of Soft Drinks: Volume million litres OFF-trade ON-trade Fountain ON-trade volume through c-store Fountain ON-trade volume through food store Total fountain ON-trade volume Total,,,,,, Note: Total fountain on-trade volume data included in on-trade Table 33 Forecast Off-trade vs On-trade Fountain Sales of Soft Drinks: % Volume Growth % fountain volume growth OFF-trade ON-trade Fountain ON-trade volume through c-store Fountain ON-trade volume through food store Total fountain ON-trade volume Total 2014/ CAGR 2010/15 TOTAL Note: Total fountain on-trade volume data included in on-trade Table 34 Forecast Off-trade vs On-trade Fountain Sales of Carbonates: Volume million litres OFF-trade ON-trade Fountain ON-trade volume through c-store Fountain ON-trade volume through food store Total fountain ON-trade volume Total 2, , , , , ,612.6 Note: Total fountain on-trade volume data included in on-trade

31

32

33

34

35

36

37

38

39

40

41

42

43 BOTTLED WATER IN SOUTH KOREA - CATEGORY ANALYSIS HEADLINES In 2010, bottled water sees 9% total volume growth The health and wellness trend continues to drive premium bottled water growth in South Korea Carbonated bottled water records the strongest total volume growth at 26% in 2010 Average unit prices increase by 1% in 2010 Nong Shim Co Ltd continues to lead bottled water sales in value terms with a 17% off-trade value share Bottled water is expected to grow at a CAGR of 6% in total volume terms over the forecast period TRENDS In 2010, bottled water continued to register strong growth, rising by 9% in total volume terms, mainly thanks to the good performance of still bottled water and carbonated bottled water. While more South Korean consumers are becoming aware of the importance of water consumption, premium bottled water such as deep sea water and imported bottled water, from various countries, including Evian (Groupe Danone) and Fiji by Fiji Water LLC performed well. Still bottled water recorded 9% growth in total volume terms. Still bottled water is considered an important aspect of the non-alcoholic drinks industry. Historically, the major factor driving growth was consumers distrust of tap water. During 2009, more South Korean consumers switched to bottled water from RTD tea which is cheaper in terms of unit price. With the economic recovery in 2010, more South Korean consumers have started to look for premium bottled water with health claims, for example those that include the minerals of specific regions. In September 2010, the US premium water brand, Fiji by Fiji Water LLC was introduced in South Korea and it has shown very healthy growth in The average unit price of bottled water as a whole rose by 1% in 2010, although the unit price of still bottled water increased by 3%. This is because premiumisation strongly impacted this category; the Evian brand increased by 62% in off-trade sales value in 2010, and the premium bottled water Fiji was introduced in As increasing numbers of South Korean consumers have been to Europe and the US, the premium still bottled water category continued to grow, supported by those consumers. This trend contributed to the rise in unit price. Carbonated bottled water showed strong growth in Lotte Chilsung Beverage Co Ltd relaunched Trevi, which targets female consumers, with a special bottle design in As the leading company in soft drinks, Lotte Chilsung entered carbonated bottled water with a positive marketing campaign for its Trevi brand; this category is expected to increase rapidly. Total volume sales of carbonated bottled water increased at a CAGR of 38% over the review period and they are expected to increase at a CAGR of 14% during the forecast period. When compared to European countries and neighbouring Japan, the carbonated bottled water category in South Korea still very small, thus it has the potential to grow more.

44 Functional bottled water continued to see a decline, falling by 8% in total volume terms due to the discontinuation of water containing amino acids. As water containing vitamins replaced amino acids water, vitamin water showed strong growth. Coca-Cola Korea Co introduced Glacéau VitaminWater in 2009, which stimulated some interest in the category. This brand registered 90% growth in COMPETITIVE LANDSCAPE In off-trade value terms, Nong Shim Co Ltd s brand Cheju Samdasoo led the bottled water category with a share of 17% in Cheju Samdasoo is produced by the Jeju Provincial Development Corp in collaboration with Nong Shim and has maintained its leadership position as a result of its pure and clean positioning, using the clean image of Jeju Island during product promotion. In the context of the sweltering summer weather, the brand s sales soared. In August 2010, its orders exceeded 2,600 tonnes per day, even though the average production capability was 1.8 million litres. In addition, Jeju Samdasoo was designated the official still bottled water for the 2010 G20 Seoul Summit. Content removed from sample PROSPECTS The bottled water category is expected to see sales rise at a CAGR of 6% in total volume terms over the forecast period. Premium water that includes minerals or is sourced from special locations, carbonated bottled water, and vitamin water will gain popularity among highincome consumers and young consumers who are sensitive changing trends. Young consumers have usually experienced foreign brands through travel or study abroad. As a result, they are familiar with imported premium bottled water brands, and some of them seek out certain brands in South Korea. This consumer base will support the expansion of premium imported brands in the domestic environment.

45 Content removed from sample CATEGORY DATA Institutional Bottled Water Sales Institutional bottled water sales showed growth of 2% during The penetration of bottled water in institutions such as hospitals, universities and organisations has increased as growing numbers of consumers consider tap water to be unsafe in South Korea. Most institutional bottled water is ordered through contractors that offer cooling systems, which are supplied at the time of the water delivery. However, the growth of institutional bottled water sales is slowing as this segment has reached a level of maturity and the barrier to entry is high as the contractors are limited and they have strong distribution networks based on wellestablished relationships with institutions. Table 1 Sales of Bottled Water to Institutional Channel Million litres Sales % growth store checks, trade interviews Table 2 Off-trade Sales of Bottled Water: Volume million litres Carbonated Bottled Water Flavoured Bottled Water Functional Bottled Water Still Bottled Water Bottled Water

46 Table 3 Off-trade Sales of Bottled Water: Value Won billion Carbonated Bottled Water Flavoured Bottled Water Functional Bottled Water Still Bottled Water Bottled Water Table 4 Off-trade Sales of Bottled Water: % Volume Growth % volume growth Carbonated Bottled Water Flavoured Bottled Water Functional Bottled Water Still Bottled Water Bottled Water 2009/ CAGR 2005/10 TOTAL Table 5 Off-trade Sales of Bottled Water: % Value Growth % current value growth Carbonated Bottled Water Flavoured Bottled Water Functional Bottled Water Still Bottled Water Bottled Water 2009/ CAGR 2005/10 TOTAL Table 6 Company Shares of Bottled Water by Off-trade Volume % off-trade volume Company

47 Total Table 7 Brand Shares of Bottled Water by Off-trade Volume % off-trade volume Brand Company Total

48 Table 8 Company Shares of Bottled Water by Off-trade Value % off-trade value rsp Company Total Table 9 Brand Shares of Bottled Water by Off-trade Value % off-trade value rsp Brand Company

49 Total Table 10 Forecast Off-trade Sales of Bottled Water: Volume million litres Carbonated Bottled Water Flavoured Bottled Water Functional Bottled Water Still Bottled Water Bottled Water Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 11 Forecast Off-trade Sales of Bottled Water: Value Won billion Carbonated Bottled Water Flavoured Bottled Water Functional Bottled Water Still Bottled Water Bottled Water Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 12 Forecast Off-trade Sales of Bottled Water: % Volume Growth

50 % volume growth Carbonated Bottled Water Flavoured Bottled Water Functional Bottled Water Still Bottled Water Bottled Water 2014/ CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 13 Forecast Off-trade Sales of Bottled Water: % Value Growth % constant value growth Carbonated Bottled Water Flavoured Bottled Water Functional Bottled Water Still Bottled Water Bottled Water CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

51 CARBONATES IN SOUTH KOREA - CATEGORY ANALYSIS HEADLINES Sales increase by 2% in total volume terms and by 5% in total value terms in 2010 Manufacturers introduce new concept of carbonates including natural ingredients to capitalise on the well-being trend Non juice-based lemonade/lime category registers the fastest growth in 2010, by 6% in total current value terms and 4% in total volume terms The average unit price of carbonates increases by 2% in total current value terms in 2010 Lotte Chilsung Beverage Co Ltd leads in off-trade value terms with a 45% share in 2010 Carbonates sales are expected to increase at a CAGR of 1% total constant value terms and 2% in total volume terms TRENDS In 2010, products within the carbonates category were re-evaluated by consumers, thanks to the introduction of unique concepts. Manufacturers started to add health positioning to carbonates, a strategy which appealed to South Korean consumers during Dong-A Otsuka Co Ltd introduced a new version of its Oran-C brand in late 2009, and it was well accepted by consumers. New Oran-C included 100mg of vitamin C per 100ml and the company used natural fruit juice instead of artificial ingredients. With the increasing concern over health and wellness, more manufacturers have introduced carbonates with added fruit juice in a bid to sustain consumer interest and stem decline. Woongjin Food Co Ltd introduced two new juice-based carbonates in 2010, adding tomato and aloe juice extracts, under the new brand name of O clock. Health and weight management was still the hot issue in South Korea. Male and female celebrities with fit and attractive bodies have been under the spotlight and the trend has spread among South Korean consumers. Manufacturers introduced low calorie products, through reducing sugar, as a response to this trend. Dong-A Otsuka Co Ltd re-launched a non juice-based lemonade/lime brand, Narangde, in 2010 with zero calories and no artificial colouring, which gained popularity during the year. In 2010, on-trade fountain sales of carbonates continued to grow in volume terms, reflecting the increasing numbers of young consumers who frequently enjoy leisure and cultural activities. Full-service restaurants offering Western foods in South Korea, which recorded declining sales in 2009, returned to healthy growth in 2010 with special marketing strategies to attract young consumers. North American full-service restaurants and casual concept European full-service restaurants have seen positive growth in TGI Friday s showed a 10% growth rate and opened three more outlets in As most North American full-service restaurants are returning to healthy performances in 2010, fountain sales in the foodservice channel continued to expand. Average unit price of carbonates at the total level increased by 2% in This was largely due to the higher prices of carbonates with reduced calories and carbonates with no artificial ingredients.

52 COMPETITIVE LANDSCAPE Lotte Chilsung Beverage Co Ltd maintained its leading position in carbonates in 2010 with a 45% share of off-trade value sales. Since LG Household and Health Care Co Ltd acquired Coca-Cola Korea Bottling Co Ltd in 2008, the parent company has supported its brands with marketing efforts and a strong distribution network. Thanks to the support, Coca-Cola Korea Co continued to see healthy growth of 6% in off-trade value sales during in Its value share also saw a marginal increase to 39%. Content removed from sample PROSPECTS Carbonates sales are expected to increase at a CAGR of 1% in total constant value terms and 2% in total volume terms over the forecast period. Cola, non-cola, and other non-cola carbonates will continue to show positive growth, while mixers and orange carbonates will continue to decrease at a constant value CAGR 3% and 2% respectively over the forecast period. Given the new launch of various flavours including chocolate flavour by Haitai Beverage Co Ltd as the brand expansion of Sunny Ten and tomato and aloe flavour by Woongjin Food Co Ltd in 2010, carbonates category is expected to see more activity on this front over the forecast period. Content removed from sample

53 presence of private label products is expected to bring down average unit prices over the forecast period. CATEGORY DATA Table 1 % total volume Low Calorie Carbonates by Subsector Cola carbonates store checks, trade interviews Table 2 Off-trade Sales of Carbonates by Category: Volume million litres Cola Carbonates - Regular Cola Carbonates - Low Calorie Cola Carbonates Non-Cola Carbonates - Lemonade/Lime - Mixers - Orange Carbonates - Other Non-Cola Carbonates Carbonates Table 3 Off-trade Sales of Carbonates by Category: Value Won billion Cola Carbonates - Regular Cola Carbonates - Low Calorie Cola Carbonates Non-Cola Carbonates - Lemonade/Lime - Mixers - Orange Carbonates - Other Non-Cola Carbonates Carbonates Table 4 Off-trade Sales of Carbonates by Category: % Volume Growth

54 % volume growth Cola Carbonates - Regular Cola Carbonates - Low Calorie Cola Carbonates Non-Cola Carbonates - Lemonade/Lime - Mixers - Orange Carbonates - Other Non-Cola Carbonates Carbonates 2009/ CAGR 2005/10 TOTAL Table 5 Off-trade Sales of Carbonates by Category: % Value Growth % current value growth Cola Carbonates - Regular Cola Carbonates - Low Calorie Cola Carbonates Non-Cola Carbonates - Lemonade/Lime - Mixers - Orange Carbonates - Other Non-Cola Carbonates Carbonates 2009/ CAGR 2005/10 TOTAL Table 6 On-trade vs Off-trade Sales of Carbonates: Volume million litres OFF-trade ON-trade Total Table 7 On-trade vs Off-trade Sales of Carbonates: Value Won billion OFF-trade ON-trade Total

55 Table 8 On-trade vs Off-trade Sales of Carbonates: % Volume Growth % volume growth OFF-trade ON-trade Total 2009/ CAGR 2005/10 TOTAL Table 9 On-trade vs Off-trade Sales of Carbonates: % Value Growth % current value growth OFF-trade ON-trade Total 2009/ CAGR 2005/10 TOTAL Table 10 % volume Off-trade Sales of Low Calorie Cola Carbonates by Category: % Volume Breakdown Low Calorie Cola Carbonates -- Standard Low Calorie Cola -- Speciality Low Calorie Cola Table 11 Company Shares of Carbonates by Off-trade Volume % off-trade volume Company Total

56 Table 12 Brand Shares of Carbonates by Off-trade Volume % off-trade volume Brand Company Others Total Table 13 Company Shares of Carbonates by Off-trade Value % off-trade value rsp Company Total

57 Table 14 Brand Shares of Carbonates by Off-trade Value % off-trade value rsp Brand Company Total Table 15 Forecast Off-trade Sales of Carbonates by Category: Volume million litres Cola Carbonates - Regular Cola Carbonates - Low Calorie Cola Carbonates

58 Non-Cola Carbonates - Lemonade/Lime - Mixers - Orange Carbonates - Other Non-Cola Carbonates Carbonates Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 16 Forecast Off-trade Sales of Carbonates by Category: Value Won billion Cola Carbonates - Regular Cola Carbonates - Low Calorie Cola Carbonates Non-Cola Carbonates - Lemonade/Lime - Mixers - Orange Carbonates - Other Non-Cola Carbonates Carbonates Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 17 Forecast Off-trade Sales of Carbonates by Category: % Volume Growth % volume growth Cola Carbonates - Regular Cola Carbonates - Low Calorie Cola Carbonates Non-Cola Carbonates - Lemonade/Lime - Mixers - Orange Carbonates - Other Non-Cola Carbonates Carbonates 2014/ CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 18 Forecast Off-trade Sales of Carbonates by Category: % Value Growth % constant value growth Cola Carbonates - Regular Cola Carbonates CAGR 2010/15 TOTAL

59 - Low Calorie Cola Carbonates Non-Cola Carbonates - Lemonade/Lime - Mixers - Orange Carbonates - Other Non-Cola Carbonates Carbonates Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

60 CONCENTRATES IN SOUTH KOREA - CATEGORY ANALYSIS HEADLINES Concentrates sees off-trade value sales grow by 8% in 2010 to reach Won57 billion Powder concentrates with reduced sugar and low calorie content are popular under the health and wellness trend Liquid concentrates registers the fastest sales growth in 2010, rising by 8% in off-trade value terms, while off-trade value sales of powder concentrates increase by 4% The average unit price increases by 3% in 2010, mainly due to the launch of new premium products While Unilever Korea Co Ltd dominates powder concentrates with a 73% value share, the competitive landscape of the concentrates category as a whole is highly fragmented in 2010 Over the forecast period, the liquid concentrates category is expected to grow at a CAGR of 3% in constant off-trade value terms TRENDS Concentrates showed healthy growth in 2010 in both powder and liquid concentrates, with an overall rise of 8% in off-trade value sales. Liquid concentrates showed faster growth than powder concentrates. With increasing concerns about health, consumers enjoyed liquid concentrates as nutritional supplements. Grape, balloon flower roots and plum concentrates were perceived as nutritional supplements for health instead of drinks by consumers; most of these products are available in liquid format rather than powder in South Korea. These products are produced from diverse provinces, with some brands only distributed in certain regions. Therefore, players remained fragmented in liquid concentrates, with the category seeing a rise of 4% in RTD volume terms. Powder concentrates saw increased RTD volume sales despite the fact that most South Korean consumers were wary of drinking powder concentrates due to their high calorie and sugar content. However, manufacturers introduced new health-positioned powder concentrates with less sugar and without artificial colouring; these new products attracted consumers in For example, Dongsuh Foods Co Ltd launched a new powder concentrate ice tea brand called Tio, whose reduced sugar content was achieved by adding oligosaccharides and xilitol. The company also emphasised that it did not use artificial colouring in this brand. It aims to challenge the domination of Unilever Korea Co Ltd within the powder concentrates category with its wellness-concept brand. In the response, however, Unilever Korea Co Ltd launched an apple-flavoured powder concentrate. Following these new product developments, powder concentrates showed slightly better total volume growth in 2010 than in 2009, rising by 2%. With the continuing popularity of vinegar concentrates, known for their invigorating and antiageing effects among older people, liquid concentrates continued to register healthy 4% total RTD volume growth in Although manufacturers are not undertaking aggressive marketing promotions, more South Korean consumers became aware of the health benefits of vinegar drinks and liquid concentrates continued to register a good performance in 2010.

61 COMPETITIVE LANDSCAPE Within powder concentrates, Unilever Korea Co Ltd maintained its leading position with a 73% share of off-trade volume and value sales in 2010, followed by Nestlé Korea Ltd which held an off-trade volume and value share of 1%. Due to the introduction of new products by domestic companies, the dominant foreign brands lost value share, while the share of others within powder concentrates rose by two percentage points in Content removed from sample PROSPECTS Over the forecast period, total volume sales of liquid concentrates are expected to grow at a CAGR of 3%. As health-conscious consumption drives the liquid concentrates category, new products with healthy ingredients are likely to continue to be introduced during the forecast period. As major food companies are focusing their attention on liquid concentrates, this category is likely to see faster growth than powder concentrates. However, the growth rate is expected to slow down over the course of the forecast period as the category becomes more mature. Content removed from sample CATEGORY DATA Concentrates Conversions Powder concentrates are mostly consumed with a ratio of 1kg to 10 litres in South Korea. Most liquid concentrates are produced using fruits known to have health benefits. Plum is the most popular liquid concentrate flavour, perceived to be beneficial to those suffering with stomach ache; however vinegar liquid concentrate held the majority share of liquid concentrates sales, with the major food companies being active in this category. Vinegar concentrates are consumed in a ratio of 1:1, 1:2 or 1:3. Fruit-based liquid concentrates are mostly consumed in a 1:4 format in South Korea.

62 Table 1 Concentrates Conversion Factors for Ready-to-Drink (RTD) Format Powder concentrates Liquid concentrates Euromonitor International 1 kg = 10 litres 1 litre = 4 litres Table 2 Off-trade Sales of Concentrates (as sold) by Category: Volume Liquid Concentrates (million litres) Powder Concentrates (Tonnes) Concentrates (million litres) Note: Totals exclude powder concentrates Table 3 Off-trade Sales of Concentrates (as sold) by Category: % Volume Growth % volume growth Liquid Concentrates Powder Concentrates Concentrates Note: 2009/ CAGR 2005/10 TOTAL Totals exclude powder concentrates Table 4 Off-trade Sales of Concentrates (RTD) by Category: Volume million litres Liquid Concentrates Powder Concentrates Concentrates Table 5 Off-trade Sales of Concentrates (RTD) by Category: % Volume Growth % volume growth Liquid Concentrates Powder Concentrates Concentrates 2009/ CAGR 2005/10 TOTAL

63 Table 6 Off-trade Sales of Concentrates by Category: Value Won billion Liquid Concentrates Powder Concentrates Concentrates Table 7 Off-trade Sales of Concentrates by Category: % Value Growth % current value growth Liquid Concentrates Powder Concentrates Concentrates 2009/ CAGR 2005/10 TOTAL Table 8 Company Shares of Powder Concentrates (as sold) by Off-trade Volume % off-trade volume Company Total Table 9 Brand Shares of Powder Concentrates (as sold) by Off-trade Volume % off-trade volume Brand Company Total

64 Table 10 Company Shares of Concentrates (RTD) by Off-trade Volume % off-trade volume Company Total Table 11 Brand Shares of Concentrates (RTD) by Off-trade Volume % off-trade volume Brand Company Total Table 12 Company Shares of Concentrates by Off-trade Value % off-trade value rsp Company Total Table 13 Brand Shares of Concentrates by Off-trade Value % off-trade value rsp Brand Company Total Table 14 Forecast Off-trade Sales of Concentrates (as sold) by Category: Volume

65 Liquid Concentrates (million litres) Powder Concentrates (Tonnes) Concentrates (million litres) Note: Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Totals exclude powder concentrates Table 15 % volume growth Forecast Off-trade Sales of Concentrates (as sold) by Category: % Volume Growth / CAGR 2010/15 TOTAL Liquid Concentrates Powder Concentrates Concentrates Note: Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Totals exclude powder concentrates Table 16 Forecast Off-trade Sales of Concentrates (RTD) by Category: Volume million litres Liquid Concentrates Powder Concentrates Concentrates Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 17 % volume growth Forecast Off-trade Sales of Concentrates (RTD) by Category: % Volume Growth / CAGR 2010/15 TOTAL Liquid Concentrates Powder Concentrates Concentrates Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 18 Forecast Off-trade Sales of Concentrates by Category: Value Won billion Liquid Concentrates

66 Powder Concentrates Concentrates Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 19 Forecast Off-trade Sales of Concentrates by Category: % Value Growth % constant value growth Liquid Concentrates Powder Concentrates Concentrates CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

67 FRUIT/VEGETABLE JUICE IN SOUTH KOREA - CATEGORY ANALYSIS HEADLINES In 2010, sales increase by 1% in total current value terms and decrease by 2% in total volume terms Growth of chilled premium fruit/vegetable juice puts a brake on the overall decline in total fruit/vegetable juice sales Juice drinks excluding Asian posts the strongest performance, with sales rising by 5% in total value terms Average unit prices increase by 3% in 2010 in total value terms Lotte Chilsung Beverage Co Ltd maintains leading position with off-trade value share of 39% in 2010 Fruit/vegetable juice sales are expected to decline at a CAGR of 1% in total value and total volume terms over the forecast period TRENDS The premiumisation of fruit/vegetable juice accelerated in 2010 though fruit/vegetable juice market continued declining in Since 2004, the category has seen sales decline; however more fruit/vegetable juice manufacturers introduced chilled juices under reconstituted 100% juice in Chilled juices have been taking the place of existing fruit/vegetable juice, to account for an 11% share in terms of off-trade volume sales in Given the health and wellness trend, consumers preferred more natural fruit/vegetable juice and manufacturers also introduced various flavours of chilled fruit/vegetable juice to meet consumer demand. While general consumers preference for lighter and lower calorie drinks will bring continued market declining in fruit/vegetable juice in South Korea, chilled 100% fruit/vegetable juice will continue appealing to more health conscious South Korean consumers. With the popularity of chilled 100% juice in South Korea, the leading soft drinks manufacturer, Lotte Chilsung Beverage Co Ltd, renewed its Del Monte Cold brand, adding the flavour of Cheju Tangerine, which used to be sold as unfrozen nectar containing only 50% juice. The renewed Del Monte Cold is available through most grocery retailers, however the larger 950ml and 1.89-litre packs are mainly distributed through supermarkets/hypermarkets, while smaller 235ml packs tend to be distr buted through convenience stores. Every year since 2005, Asian juice drinks has seen a double-digit decline. The most popular flavours in Asian juice drinks in South Korea are plum juice and aloe juice. As more consumers become aware that these products contain high levels of sugar, diet-conscious consumers have shifted away from these products. With these trends, there have been no significant new product developments and the Asian juice drinks category is expected to continue its negative direction during the forecast period. Average unit prices increased by 3% in 2010 in total value terms, mainly due to a process of premiumisation. While most 100% juice is from reconstituted 100% juice, more South Korean

68 consumers look for better tasting juice and manufacturers have actively expanded chilled reconstituted 100% juice products during COMPETITIVE LANDSCAPE Lotte Chilsung Beverage Co Ltd maintained its leading position in fruit/vegetable juice in 2010 with a 39% off-trade value share. Reflecting the overall decline in the fruit/vegetable juice category, the company saw its volume and value sales decline in In addition, as competition in the chilled juice segment became intense, the company s value and volume share in fruit/vegetable juice was reduced by new manufacturers. In particular, the company showed a weak performance in juice drinks (up to 24% juice), with the continuing decline of Asian juice drinks in Due to the weak performance of Asian juice drinks, the company gradually discontinued their brands since Content removed from sample PROSPECTS Although there is increasing demand for premium fruit/vegetable juice in South Korea, the category overall is not likely to recover to show positive growth during forecast period, with an annual 1% decline in off-trade value and volume sales expected. While fruit/vegetable juice is considered to be a healthy drink, because of its sometimes high sugar content, diet-conscious South Korean consumers still try to avoid it. Unless there are new products in development which appeal to young female consumers in their 20s and 30s, the negative performance is expected to continue. Content removed from sample

69 Content removed from sample CATEGORY DATA Table 1 Off-trade Sales of Fruit/Vegetable Juice by Category: Volume million litres 100% Juice - Frozen 100% Juice - Not from Concentrate 100% Juice - Reconstituted 100% Juice Juice Drinks (up to 24% Juice) - Asian Juice Drinks - Frozen Juice Drinks - Juice Drinks Excluding Asian Fruit-Flavoured Drinks (No Juice Content) Nectars (25-99% Juice) - Frozen Nectars - Unfrozen Nectars Fruit/Vegetable Juice Table 2 Off-trade Sales of Fruit/Vegetable Juice by Category: Value Won billion 100% Juice - Frozen 100% Juice - Not from Concentrate 100% Juice - Reconstituted 100% Juice Juice Drinks (up to 24% Juice) - Asian Juice Drinks - Frozen Juice Drinks - Juice Drinks Excluding Asian Fruit-Flavoured Drinks (No Juice Content) Nectars (25-99% Juice)

70 - Frozen Nectars - Unfrozen Nectars Fruit/Vegetable Juice, Table 3 Off-trade Sales of Fruit/Vegetable Juice by Category: % Volume Growth % volume growth 100% Juice - Frozen 100% Juice - Not from Concentrate 100% Juice - Reconstituted 100% Juice Juice Drinks (up to 24% Juice) - Asian Juice Drinks - Frozen Juice Drinks - Juice Drinks Excluding Asian Fruit-Flavoured Drinks (No Juice Content) Nectars (25-99% Juice) - Frozen Nectars - Unfrozen Nectars Fruit/Vegetable Juice 2009/ CAGR 2005/10 TOTAL Table 4 Off-trade Sales of Fruit/Vegetable Juice by Category: % Value Growth % current value growth 100% Juice - Frozen 100% Juice - Not from Concentrate 100% Juice - Reconstituted 100% Juice Juice Drinks (up to 24% Juice) - Asian Juice Drinks - Frozen Juice Drinks - Juice Drinks Excluding Asian Fruit-Flavoured Drinks (No Juice Content) Nectars (25-99% Juice) - Frozen Nectars - Unfrozen Nectars Fruit/Vegetable Juice 2009/ CAGR 2005/10 TOTAL Table 5 Leading Flavours for 100% Juice: % Volume Breakdown % retail volume

71 Apple Carrot Grape Orange Tomato Vegetable Other flavours Total Table 6 Leading Flavours for Nectars (25-99% Juice): % Volume Breakdown % retail volume Grape Mango Orange Tangerine Tomato Other flavours Total Table 7 % retail volume Leading Flavours for Juice Drinks (up to 24% Juice): % Volume Breakdown Grape Guava Lemon Orange Plum Pomegranate Other flavours Total Table 8 % value analysis % Share of Smoothies in 100% Juice and Nectars (25-99% Juice): Off-trade Value 2010 Smoothies Others Total 100% Juice Nectars (25-99% Juice)

72 Table 9 Chilled Vs Ambient Reconstituted 100% Juice: % Analysis % retail volume Chilled Juices Ambient Juices Total Table 10 Company Shares of Fruit/Vegetable Juice by Off-trade Volume % off-trade volume Company Total Table 11 Brand Shares of Fruit/Vegetable Juice by Off-trade Volume % off-trade volume Brand Company

73 Total Table 12 Company Shares of Fruit/Vegetable Juice by Off-trade Value % off-trade value rsp Company Total Table 13 Brand Shares of Fruit/Vegetable Juice by Off-trade Value % off-trade value rsp Brand Company

74 Total Table 14 Forecast Off-trade Sales of Fruit/Vegetable Juice by Category: Volume million litres 100% Juice Juice Drinks (up to 24% Juice) Fruit-Flavoured Drinks (No Juice Content) Nectars (25-99% Juice) Fruit/Vegetable Juice

75 Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 15 Forecast Off-trade Sales of Fruit/Vegetable Juice by Category: Value Won billion 100% Juice Juice Drinks (up to 24% Juice) Fruit-Flavoured Drinks (No Juice Content) Nectars (25-99% Juice) Fruit/Vegetable Juice Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 16 % volume growth Forecast Off-trade Sales of Fruit/Vegetable Juice by Category: % Volume Growth / CAGR 2010/15 TOTAL 100% Juice Juice Drinks (up to 24% Juice) Fruit-Flavoured Drinks (No Juice Content) Nectars (25-99% Juice) Fruit/Vegetable Juice Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 17 Forecast Off-trade Sales of Fruit/Vegetable Juice by Category: % Value Growth % constant value growth 100% Juice Juice Drinks (up to 24% Juice) Fruit-Flavoured Drinks (No Juice Content) Nectars (25-99% Juice) Fruit/Vegetable Juice CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

76 RTD COFFEE IN SOUTH KOREA - CATEGORY ANALYSIS HEADLINES Sales of RTD coffee increase by 7% in total volume terms in 2010 Based on the popularity of specialist coffee shops brands in the retail channel, RTD coffee shows a strong performance Sales increase by 11% in off-trade value terms in 2010 Average unit prices increase by 4% in 2010, mainly as a result of the premiumisation trend within the category Lotte Chilsung Beverage Co Ltd continues to lead the category with a 40% value share in 2010 RTD coffee is expected to see both total volume and constant value sales grow at a CAGR of 6% over the forecast period TRENDS RTD coffee continued to register healthy growth, with total volume sales rising by 7% in While specialist coffee shops grew in popularity during 2010, RTD coffee has been premiumised and performed very well. As RTD coffee manufacturers actively introduced premium RTD coffee products, specialist coffee shop operators also expanded their presence in RTD coffee; this trend started with Starbucks in 2007 which expanded into local specialist coffee brands, while Angel-in-us Coffee by Lotteria Co Ltd and Café Bene by Café Bene Co Ltd also introduced their branded RTD coffees in 2010 and earned popularity among South Korean consumers. The unit price of RTD coffee increased by 4% in 2010, being impacted by the premiumisation through specialist coffee shop brands. Previously, the unit price of canned RTD coffee, such as Let s Be (Lotte Chilsung Beverage Co Ltd), was around Won650 per 175ml pack, while mid-premium RTD coffee was priced at around Won1,200 per 200ml pack, including French Café Cappuccino (offered in cup format) by Namyang Dairy Products Co Ltd and Caffé Latte Barista Smokey by Maeil Dairy Industry Co Ltd, which entered the category in the early 2000s in South Korea. In 2010, however, the unit price of some RTD coffee increased to more than Won1,500 for a 200ml pack, as was the case with Cantata Original Sweet Black by Lotte Chilsung and Starbucks Discoveries Espresso - Milano by Seoul Dairy Cooperative Co Ltd. These high prices are the result of the use of high quality coffee beans, which come with a premium price tag. Chained specialist coffee shop-branded RTD coffee, including Starbucks, Café Bene and Angel-in-us Coffee showed strong performance in Most of these specialist coffee shops are working with packaged food manufacturers, which produce the RTD coffee, having distribution agreements that place the brands in the retail environment. Starbucks has an agreement with Dongsuh Foods Co Ltd, Café Bene is working with Daesang Corp and Angelin-us Coffee with Lotte Chilsung. These specialist coffee shop RTD coffee brands have been well accepted by young female consumers in their 20s and 30s, as they appreciate being able

77 to enjoy the same coffee flavours at a lower price at home, with most of those RTD coffee brands available through convenience stores. COMPETITIVE LANDSCAPE Lotte Chilsung Beverage Co Ltd maintained its leadership of the RTD coffee category with a 44% share in off-trade volume terms. Its Let s Be brand leads the category with a high level of penetration and wide distribution across a range of grocery retailers. However, its value sales decreased by 1% in 2010 as a result of the introduction of other premium brands. Cantata, the company s other brand introduced in 2007, for example, showed a positive performance in value terms in 2010 as its value sales rose by 20%. This however was not sufficient to stop the company s share declining overall. Content removed from sample PROSPECTS RTD coffee will continue to show healthy growth over the forecast period, with a CAGR of 6% in both off-trade constant value and volume terms. Within the foodservice industry, it is anticipated that specialist coffee shops will grow over the forecast period, meaning that

78 consumers preference for premium coffee will also develop. This trend will affect the RTD coffee category, as manufacturers will try to launch new premium variants to appeal to South Korean consumers who are already familiar with better quality coffee. At the same time, operators of chained specialist coffee shop brands will try to introduce RTD coffee to expand their brands presence through retail channels. Content removed from sample CATEGORY DATA Table 1 Off-trade Sales of RTD Coffee: Volume million litres RTD Coffee Table 2 Off-trade Sales of RTD Coffee: Value Won billion RTD Coffee Table 3 Off-trade Sales of RTD Coffee: % Volume Growth % volume growth RTD Coffee 2009/ CAGR 2005/10 TOTAL Table 4 Off-trade Sales of RTD Coffee: % Value Growth % current value growth RTD Coffee 2009/ CAGR 2005/10 TOTAL

79 Table 5 Company Shares of RTD Coffee by Off-trade Volume % off-trade volume Company Total Table 6 Brand Shares of RTD Coffee by Off-trade Volume % off-trade volume Brand Company Total Table 7 Company Shares of RTD Coffee by Off-trade Value % off-trade value rsp Company

80 Total Table 8 Brand Shares of RTD Coffee by Off-trade Value % off-trade value rsp Brand Company Total Table 9 Forecast Off-trade Sales of RTD Coffee: Volume '000 litres RTD Coffee Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

81 Table 10 Forecast Off-trade Sales of RTD Coffee: Value Won mn RTD Coffee Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 11 Forecast Off-trade Sales of RTD Coffee: % Volume Growth % volume growth RTD Coffee 2014/ CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 12 Forecast Off-trade Sales of RTD Coffee: % Value Growth % constant value growth RTD Coffee CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

82 RTD TEA IN SOUTH KOREA - CATEGORY ANALYSIS HEADLINES In 2010, sales decrease by 4% in off-trade volume terms and by 2% in off-trade current value terms The growing interest in health-positioned bottled water continues to negatively impact RTD tea in 2010 Still RTD tea excluding Asian shows the strongest growth in 2010, with a rise of 2% in offtrade volume terms Average off-trade unit prices increase by 2% in 2010 Lotte Chilsung Beverage Co Ltd maintains its leadership with a 21% value share in 2010 Sales of RTD tea are expected to decline at a CAGR of 2% both in off-trade volume and constant value terms over the forecast period TRENDS RTD tea continued to register a negative performance, with total volume sales falling by 3% in The negative trend started in 2008 as the economy slowed down during the global financial crisis. During this period, more South Korean consumers shifted their consumption away from RTD tea and towards still bottled water, which is cheaper and known to contain zero calories. Even though the economy has seen some recovery in 2010, South Korean consumers are not returning to RTD tea, largely because the product offer has widened within bottled water, to include various new products such as functional bottled water and premium imported bottled water, which gained popularity during In 2010, green tea saw its popularity wane further (although it remained the largest category within RTD tea). Most of RTD tea manufacturers highlight the beauty and weight management functions of their RTD tea products through various advertisements using famous female actresses. Attractive female models show their slim bodies in such advertisements, which are targeted towards female consumers with aspirations of beauty. However, more South Korean consumers are coming to perceive these products as offering few health benefits and thus are reverting to seeing them as simply a product to quench thirst. This resulted in waning popularity for green RTD tea. During the summer season, basic RTD tea brands, Lipton Ice Tea (Unilever Korea Co Ltd) and Nestea (Coca-Cola Korea Co) were popular, due to the hotter and longer summer in 2010 than other years and because these are cheaper and easier to drink, despite these products higher calorie content in relation to bottled water. In 2010, mugwort RTD tea gained prominence as a health-positioned product. Mugwort is considered as having properties than support effective circulation in the body. In addition, mugwort is famous as a herbal medicine that has traditionally been used in the treatment of various female ailments. In this context, Lotte Chilsung Beverage Co Ltd launched Brown Rice Mugwort Tea under its Today s tea brand. New launches such as these helped maintain average unit price increases, despite an emerging shift in consumer preferences away from premium RTD teas.

83 Hyundai Pharm Co Ltd introduced a carbonated RTD tea, Pop Sparkling Tea, in 2010 for the first time in South Korea. Its novelty has meant that its share is still not significant in South Korea, even though it has generated some consumer interest. COMPETITIVE LANDSCAPE Lotte Chilsung Beverage Co Ltd continued to lead the RTD tea category with an off-trade value share of 21% in It was followed by Kwang Dong Pharm Co Ltd with 14%. In terms of brand share Kwang Dong Pharm s RTD tea brand Kwangdong Corn Leaf Tea led the category with an off-trade value share of 14%, followed by Lotte Chilsung s Lotte brand at 13%. Kwangdong Corn Leaf Tea has lost five percentage points in terms of value share since 2008 with the various new product developments by competing manufacturers. Meanwhile, Lotte Chilsung launched a specialist RTD tea brand, Tea Tree and expanded its product portfolio through the introduction of new green tea and mate tea in 2010 under Tea Tree brand. Competition between existing tea brands and newly launched variants was intense and the gap in company value share between Lotte Chilsung and Kwang Dong Pharm widened considerably in 2010, from three percentage points in 2009 to almost seven in Content removed from sample PROSPECTS The lack of interest in Asian still RTD tea as a means of weight management will continue, which in turn will negatively affect the RTD tea category as a whole over the forecast period. As consumers become more familiar with media techniques, they are increasingly choosing not to trust advertising messages. Thus if a product is not a dietary supplement, it will become increasingly difficult for operators to attract consumers with slimming concepts. Content removed from sample

84 Content removed from sample CATEGORY DATA Table 1 Off-trade Sales of RTD Tea by Category: Volume million litres Still RTD Tea - Asian Still RTD Tea - Still RTD Tea Excluding Asian Carbonated RTD Tea RTD Tea Table 2 Off-trade Sales of RTD Tea by Category: Value Won billion Still RTD Tea - Asian Still RTD Tea - Still RTD Tea Excluding Asian Carbonated RTD Tea RTD Tea Table 3 Off-trade Sales of RTD Tea by Category: % Volume Growth % volume growth Still RTD Tea 2009/ CAGR 2005/10 TOTAL

85 - Asian Still RTD Tea - Still RTD Tea Excluding Asian Carbonated RTD Tea RTD Tea Table 4 Off-trade Sales of RTD Tea by Category: % Value Growth % current value growth Still RTD Tea - Asian Still RTD Tea - Still RTD Tea Excluding Asian Carbonated RTD Tea RTD Tea 2009/ CAGR 2005/10 TOTAL Table 5 Leading Flavours for RTD Tea: % Volume Breakdown % retail volume Black Bean Tea Black Tea Corn Leaf Tea Green Tea Mixed Tea Other flavours Total Table 6 Company Shares of RTD Tea by Off-trade Volume % off-trade volume Company

86 Total Table 7 Brand Shares of RTD Tea by Off-trade Volume % off-trade volume Brand Company Others Total Table 8 Company Shares of RTD Tea by Off-trade Value % off-trade value rsp Company

87 Total Table 9 Brand Shares of RTD Tea by Off-trade Value % off-trade value rsp Brand Company Total Table 10 Forecast Off-trade Sales of RTD Tea by Category: Volume million litres Still RTD Tea - Asian Still RTD Tea - Still RTD Tea Excluding Asian Carbonated RTD Tea RTD Tea Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

88 Table 11 Forecast Off-trade Sales of RTD Tea by Category: Value Won billion Still RTD Tea - Asian Still RTD Tea - Still RTD Tea Excluding Asian Carbonated RTD Tea RTD Tea Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 12 Forecast Off-trade Sales of RTD Tea by Category: % Volume Growth % volume growth Still RTD Tea - Asian Still RTD Tea - Still RTD Tea Excluding Asian Carbonated RTD Tea RTD Tea 2014/ CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 13 Forecast Off-trade Sales of RTD Tea by Category: % Value Growth % constant value growth Still RTD Tea - Asian Still RTD Tea - Still RTD Tea Excluding Asian Carbonated RTD Tea RTD Tea CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

89

90 SPORTS AND ENERGY DRINKS IN SOUTH KOREA - CATEGORY ANALYSIS HEADLINES Sales of sports and energy drinks increase by 8% in off-trade value terms in 2010 Energy drinks are introduced for the first time, drawing considerable attention among South Korean customers Value sales of sports drinks show a slight increase in 2010 The introduction of energy drinks pushes up average unit price increase to 6% in 2010 Dong-A Otsuka Co Ltd continues to lead in off-trade value terms with a share of 48% in 2010 Over the forecast period, sports and energy drinks is expected to register marginal growth due to the decline of sports drinks in total volume terms TRENDS Sports and energy drinks recorded positive growth in off-trade value and volume terms in There have been various new products launched under the health and wellness trend; for example, reduced calories, using stevia. Stevia was first approved for using in food from 2010 and Lotte Chilsung Beverage Co Ltd introduced low calorie sports drinks using stevia instead of sugar, targeting diet conscious consumers in South Korea. However, despite manufacturers efforts, sports drinks continued to register a decline during Within the sports drinks category, not all brands registered a strong performance and in fact recorded a decline in off-trade volume terms in 2010, despite active new product development. Lotte Chilsung launched new sports drinks brand G2 whose packaging proved popular. G2 contains half the calories of other sports drinks, thus it was well received particularly by young female consumers in Excellade from Haitai Beverage Co Ltd was launched in late 2009 and it recorded value sales of Won6 billion within one year. As soft drinks as a whole has been diversified to include a range of functional products, for example with the inclusion of extra vitamins and premium bottled water, demand for sports drinks experienced a decline in Sports and energy drinks showed a 6% unit price rise, mainly due to the 2010 entry of energy drinks, whose unit price is higher than sports drinks. However, the rise in unit price for the sports and energy drinks category was slightly restrained by the large promotions at supermarkets/hypermarkets even though Dong-A Otsuka Co Ltd s Pocari Sweat rose in price by up to 6% in With the launch of new products, manufacturers opted to engage in positive marketing activity centred on supermarkets/hypermarkets, such as buy-one-get-onefree offers, which can boost value sales, but at the expense of margins. In South Korea, energy drinks sales remained negligible until The leading soft drinks manufacturer, Lotte Chilsung introduced energy drinks for the first time in March 2010, resulting in Won18 billion sales in less than one year. Within the constraints of the law governing packaged food in South Korea, artificial caffeine is not allowed to be used for packaged food and most energy drinks incorporate artificial caffeine were classified as quasi

91 drugs in South Korea. Lotte Chilsung introduced Hot 6 in 2010, which includes taurine, citric acid and guarana and red ginseng extract. Following the success of Hot 6, some of pharmaceutical companies and soft drinks manufacturers are expected to develop new energy drinks products. Leading to strong growth in the category over the forecast period. COMPETITIVE LANDSCAPE There are three main brands within the sports and energy drinks category in South Korea. The leading brand, Pocari Sweat by Dong-A Otsuka Co Ltd, held an off-trade value share of 48% in Lotte Chilsung s Gatorade brand ranked second with a 28% value share, followed by Coca-Cola Korea Co s Powerade with a 16% share. Gatorade has seen its share rising on the back of strong marketing activities featuring the very famous soccer player, Park Ji Sung, in the product s TV commercials since Content removed from sample PROSPECTS Over the forecast period, sales of sports and energy drinks are expected to rise at a CAGR of 1% in constant value terms, with only marginal growth in volume terms. As many other categories of soft drinks offer low-calorie or no-sugar variants with added vitamins or other nutritional ingredients, consumers have become less interested in the stated benefits of sports drinks. Many consumers of sports drinks are expected to shift to functional bottled water (such as those with added vitamins) or variants with fewer calories after exercising, rather than sports drinks. Sales of sports drinks are thus expected to decrease at a CAGR of 1% in both volume and value terms over the forecast period. Content removed from sample

92 Content removed from sample CATEGORY DATA Table 1 Still vs Carbonated Sports and Energy Drinks % Off-trade Volume % volume Still Carbonated TOTAL store checks, trade interviews Table 2 Off-trade Sales of Sports and Energy Drinks by Category: Volume million litres Energy Drinks Sports Drinks Sports and Energy Drinks Table 3 Off-trade Sales of Sports and Energy Drinks by Category: Value Won billion Energy Drinks Sports Drinks Sports and Energy Drinks Table 4 Off-trade Sales of Sports and Energy Drinks by Category: % Volume Growth % volume growth Energy Drinks Sports Drinks Sports and Energy Drinks 2009/ CAGR 2005/10 TOTAL

93 Table 5 Off-trade Sales of Sports and Energy Drinks by Category: % Value Growth % current value growth Energy Drinks Sports Drinks Sports and Energy Drinks 2009/ CAGR 2005/10 TOTAL Table 6 Company Shares of Sports and Energy Drinks by Off-trade Volume % off-trade volume Company Total Table 7 Brand Shares of Sports and Energy Drinks by Off-trade Volume % off-trade volume Brand Company Total Table 8 Company Shares of Sports and Energy Drinks by Off-trade Value % off-trade value rsp Company

94 Total Table 9 Brand Shares of Sports and Energy Drinks by Off-trade Value % off-trade value rsp Brand Company Others Total Table 10 million litres Forecast Off-trade Sales of Sports and Energy Drinks by Category: Volume Energy Drinks Sports Drinks Sports and Energy Drinks Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 11 Won billion Forecast Off-trade Sales of Sports and Energy Drinks by Category: Value Energy Drinks Sports Drinks Sports and Energy Drinks Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

95 Table 12 % volume growth Forecast Off-trade Sales of Sports and Energy Drinks by Category: % Volume Growth / CAGR 2010/15 TOTAL Energy Drinks Sports Drinks Sports and Energy Drinks Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 13 Forecast Off-trade Sales of Sports and Energy Drinks by Category: % Value Growth % constant value growth Energy Drinks Sports Drinks Sports and Energy Drinks CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources

96 ASIAN SPECIALITY DRINKS IN SOUTH KOREA - CATEGORY ANALYSIS HEADLINES Sales decrease by 2% in off-trade volume terms, while seeing a marginal rise in off-trade value terms in 2010 Asian speciality tea, positioned as offering a beauty function, continues to fall out of favour with consumers Cereal/pulse-based drinks registers 7% growth in off-trade value terms, while Asian juice drinks records a 10% decline in off-trade value terms The average unit price of Asian speciality drinks increases by 3% in 2010 Woongjin Food Co Ltd continues to lead the category with an off-trade value share of 19% in 2010 Sales of Asian speciality drinks are expected to decline at a CAGR of 1% in off-trade volume and constant value terms over the forecast period, mainly due to the decline of Asian juice drinks TRENDS Asian speciality drinks registered a 2% decline in off-trade volume terms in Asian still RTD tea and Asian juice drinks both recorded negative performances, which led to the entire category registering a decline, even though cereal/pulse-based drinks showed a strong performance with off-trade volume sales rising by 4% and off-trade value sales rising by 7%. The category of other Asian speciality drinks also recorded positive growth in The cereal/pulse-based drinks category showed the strongest performance in Cereal/pulse-based drinks, a traditional rice-based South Korean drink, registered the highest value sales within Asian speciality drinks in 2010 with variants being offered by a number of operators. Since 2010, the government has tried to boost the consumption of domestic rice in South Korea and it has recommended traditional drinks such as sikhye. As sikhye was originally made from steamed rice, the campaign in support of rice consumption impacted the sales of cereal/pulse-based drinks positively. Other Asian speciality drinks recorded 1% growth in volume terms and 5% growth in value terms in Drinks made from Korean ginseng and pine, famed for their energy-giving and refreshing properties, have shown positive growth since As well as the popularity of ginseng in the context of the health and wellness trend in 2010, within the soft drinks industry, the popularity of red-ginseng drinks continued. The boom of red-ginseng that followed the H1N1 virus in 2009 faded slowly over Within Asian still RTD tea, corn leaf tea and tea made with mixed grains saw their popularity weaken in Instead, mugwort tea has emerged as a popular ingredient for RTD tea in South Korea during Mugwort is considered as having properties that support efficient blood circulation. Lotte Chilsung Beverage Co Ltd launched Brown Rice Mugwort Tea under its Today s Tea brand.

97 The Asian speciality drinks category as a whole saw average unit prices rise by 3% in Due to the relative unpopularity of Asian still RTD tea and Asian juice drinks, retail channels did not engage in promotional activities for these products. In addition, the share of sales made through the convenience store channel increased during the summer season because in 2010 the summer season was hotter and longer than previous years. In turn, this helped to boost average unit prices. Products within Asian speciality drinks are targeted at adults in their 30s and 40s who are highly conscious of their health and prudent in their food choices. Therefore, many Asian speciality drinks are positioned as well established and trustworthy in order to gain consumer interest. In an effort to broaden their consumer base, manufacturers continued to work to renew their products and to introduce new flavours using healthy ingredients, such as black bean, ginseng and honey of different origins. There are no fountain sales of Asian speciality drinks in South Korea. Fountain sales are mostly available in fast food outlets and Western-style full-service restaurants and those outlets mostly carry carbonates and fruit/vegetable juice in fountain format. However, with increasing concern about health and wellness, it is possible that Asian speciality drinks may be available through fountain sales in the forecast period. COMPETITIVE LANDSCAPE Content removed from sample PROSPECTS Content removed from sample

98 Content removed from sample CATEGORY DATA Table 1 Off-trade Sales of Asian Speciality Drinks by Category: Volume million litres Asian Still RTD Tea Asian Juice Drinks Cereal/Pulse-based Drinks Other Asian Speciality Drinks Asian Speciality Drinks Table 2 Off-trade Sales of Asian Speciality Drinks by Category: Value Won billion Asian Still RTD Tea Asian Juice Drinks Cereal/Pulse-based Drinks Other Asian Speciality Drinks Asian Speciality Drinks Table 3 Off-trade Sales of Asian Speciality Drinks by Category: % Volume Growth % volume growth Asian Still RTD Tea 2009/ CAGR 2005/10 TOTAL

99 Asian Juice Drinks Cereal/Pulse-based Drinks Other Asian Speciality Drinks Asian Speciality Drinks Table 4 Off-trade Sales of Asian Speciality Drinks by Category: % Value Growth % current value growth Asian Still RTD Tea Asian Juice Drinks Cereal/Pulse-based Drinks Other Asian Speciality Drinks Asian Speciality Drinks 2009/ CAGR 2005/10 TOTAL Table 5 Company Shares of Asian Speciality Drinks by Off-trade Volume % off-trade volume Company Total Table 6 Brand Shares of Asian Speciality Drinks by Off-trade Volume % off-trade volume Brand Company

100 Total Trade Euromonitor International from official statistics, trade associations, trade press, company research, Table 7 Company Shares of Asian Speciality Drinks by Off-trade Value % off-trade value rsp Company

101 Total Table 8 Brand Shares of Asian Speciality Drinks by Off-trade Value % off-trade value rsp Brand Company

102 Others Total Table 9 Forecast Off-trade Sales of Asian Speciality Drinks by Category: Volume million litres Asian Still RTD Tea Asian Juice Drinks Cereal/Pulse-based Drinks Other Asian Speciality Drinks Asian Speciality Drinks Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 10 Forecast Off-trade Sales of Asian Speciality Drinks by Category: Value Won billion Asian Still RTD Tea Asian Juice Drinks Cereal/Pulse-based Drinks Other Asian Speciality Drinks Asian Speciality Drinks Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 11 % volume growth Forecast Off-trade Sales of Asian Speciality Drinks by Category: % Volume Growth / CAGR 2010/15 TOTAL Asian Still RTD Tea Asian Juice Drinks Cereal/Pulse-based Drinks

103 Other Asian Speciality Drinks Asian Speciality Drinks Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources Table 12 Forecast Off-trade Sales of Asian Speciality Drinks by Category: % Value Growth % constant value growth Asian Still RTD Tea Asian Juice Drinks Cereal/Pulse-based Drinks Other Asian Speciality Drinks Asian Speciality Drinks CAGR 2010/15 TOTAL Euromonitor International from trade associations, trade press, company research, trade interviews, trade sources