Convenience Retail Asia Limited 2017 Annual Results Announcement

7 March 2018

Agenda

Hong Kong Retail Market Key Highlight

2017 Financial Results Highlight

2018 Outlook

Question & Answer

2

HONG KONG RETAIL MARKET KEY HIGHLIGHT

3

Hong Kong Retail Market

4 Source: Census & Statistics Department HKSAR

-0.2 -3.7

-8.1

2.2

-0.2 -1.5

-7.1

1.9

-15

-10

-5

0

5

10 20

14

2015

2016

2017

Total Retail Sales Value & Volume

Value Voulme

4.6

1.3 0.8

-0.2

1.0

-0.7 -0.8 -2.0

-6

-3

0

3

6

9

2014

2015

2016

2017

Value Volume

Year

-on-

year

% c

hang

e

Year

-on-

year

% c

hang

e

Supermarkets Sales Value & Volume

Hong Kong Retail Market

5

South China Morning Post 2/3/2018

HK Economic Times 2/2/2018

HK Economic Times 20/2/2018 Sing Pao Daily News 27/12/2017

Sing Pao Daily News 31/12/2017

The 3 “Plus” Strategies

6

1. Focus on “Internet Plus” customers 2. Deliver “4P’s Plus” relevant customer experience 3. Transition to “B&M Plus” (O2O) business models

ASN Fun & Novelty “Internet+”

Customer

Copyright © Circle K Convenience Stores (HK) Limited

7

3 “Plus” Strategies Driving Growth

8

OK Stamp It – Customer Engagement Tools

1. For Value 2. For Fun 3. Social Sharing

4. e-Gift Coupon

5. Customer Experience

6. O2O Lucky Draw

Copyright © Circle K Convenience Stores (HK) Limited

O2O Shake Shake Lucky Star

9 Copyright © Circle K Convenience Stores (HK) Limited

11

OK Stamp It – KPIs

Monchhichi Promotion

Member Recruitment

Pokémon Promotion

Member Recruitment

Member Recruitment

Gudetama Promotion

Copyright © Circle K Convenience Stores (HK) Limited

0

200,000

400,000

600,000

800,000

1,000,000

23/0

6/20

16

06/0

7/20

16

19/0

7/20

16

01/0

8/20

16

14/0

8/20

16

27/0

8/20

16

09/0

9/20

16

22/0

9/20

16

05/1

0/20

16

18/1

0/20

16

31/1

0/20

16

13/1

1/20

16

26/1

1/20

16

09/1

2/20

16

22/1

2/20

16

04/0

1/20

17

17/0

1/20

17

30/0

1/20

17

12/0

2/20

17

25/0

2/20

17

10/0

3/20

17

23/0

3/20

17

05/0

4/20

17

18/0

4/20

17

01/0

5/20

17

14/0

5/20

17

27/0

5/20

17

09/0

6/20

17

22/0

6/20

17

05/0

7/20

17

18/0

7/20

17

31/0

7/20

17

13/0

8/20

17

26/0

8/20

17

08/0

9/20

17

21/0

9/20

17

04/1

0/20

17

17/1

0/20

17

30/1

0/20

17

12/1

1/20

17

25/1

1/20

17

08/1

2/20

17

21/1

2/20

17

03/0

1/20

18

16/0

1/20

18

29/0

1/20

18

11/0

2/20

18

>1 Million

OK Stamp It Won Multiple Awards

12

Marketing Magazine

- Mob-Ex Awards 2017 Best App – “Consumer Brand” &

“Most Responsive Mobile Campaign” - Marketing’s inaugural eCommAs Awards 2017

Best of Show - Brand Gold for Best Customer Retention Programme

Gold for Best Omni-Channel Process Gold for Best E-Commerce Campaign

Bronze for Best User Experience

Best (Top 1) 2017Q1 Ads Leaderboard

Circle K Pokémon Video for 「OK齊齊印」app

Best of 2016 Ads Leaderboard

DoReMi Monchhichi Golden Globe Tigers 2017 Awards

- For Excellence In Retail & Store Management - For Excellence & Leadership In Social Media

& Digital Marketing - For Excellence & Leadership in Branding & Marketing

Octopus Partner Awards 2016

- The Octopus Innovation Award

Re-inventing Strategy Lifting Customer Experience

13

>340,000 Members

Circle K Hong Kong Won 2017 Service and Courtesy Award By HKRMA

14

Fast Fashion Eyewear Chain from Japan Business Introduction

• Japan Quality • Always Fresh /

Fast Service • Value for Money

Japan Quality

16

Amazing Zoff SMART – Parts used in Hakuto’s lunar rover are made from Ultem, the same materials used in Zoff SMART.

Always Fresh New glasses, new mood, “Enjoy Your Glasses”

17

Fast Services (30 mins)

18

Value For Money

19

20

The First Store In Hong Kong City Plaza, Taikoo (opened 25th November 2017)

The First Store In Hong Kong City Plaza, Taikoo (opened 25th November 2017)

21

The Second Store In Hong Kong Telford Plaza, Kowloon Bay (opened 23rd February 2018)

22

23

The Second Store In Hong Kong Telford Plaza, Kowloon Bay (opened 23rd February 2018)

2017 FINANCIAL RESULTS HIGHLIGHT

24

Number of Stores End of 2016 Opened Closed End of

2017

Circle K Hong Kong 331 10 (9) 332

Circle K Guangzhou (franchised) 71 4 (11) 64

Circle K Macau (franchised) 30 2 (3) 29

Circle K Zhuhai (franchised) 16 4 (4) 16

Saint Honore HK & Macau 98 13 (9) 102

Saint Honore Southern China 41 8 (8) 41

Zoff Hong Kong - 1 - 1

CRA Group Total 587 42 (44) 585

25

Group Turnover

1,991 2,106

576 601

0

1,000

2,000

3,000

4,000

2016 2017

HK$

Mill

ion

2nd Half

Circle K Saint Honore

26

2,532*

+5.3%

∗ Less inter-group sales: HK$35M in 2H2016 & HK$40M in 2H2017

3,871 4,077

1,072 1,092

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2016 2017

HK$

Mill

ion

Full Year

Circle K Saint Honore

4,871* 5,094*

∗ Less inter-group sales: HK$72M in 2016 & HK$75M in 2017

+4.6%

2,667*

Gross Profit & Other Income

27

37.2 37.5

30

32

34

36

38

40

2016 2017

% o

f Tur

nove

r

2nd Half

36.6 36.9

30

32

34

36

38

40

2016 2017

% o

f Tur

nove

r

Full Year

Group Store Operating Expenses

26.1 26.4

20

22

24

26

28

30

2016 2017

% o

f Tur

nove

r

2nd Half

28

+0.3%

26.2 26.3

20

22

24

26

28

30

2016 2017

% o

f Tur

nove

r

Full Year

+0.1%

Group Net Profit

88 93

0

50

100

150

2016 2017

HK$

Mill

ion

2nd Half

29

+6.1%

140 150

0

50

100

150

200

2016 2017

HK$

Mill

ion

Full Year

+7.7%

Net Profit by Market

(HK$ Million) Full Year

Change 2016 2017

Hong Kong & Macau Markets 162 169 +4.2%

Southern China Market (2) (5) -1.x%

e-commerce Group (20) (14) +34.3%

CRA Group Net Profit 140 150 +7.7%

30

Group Net Profit as % of Turnover

31

2.9 3.0

0

1

2

3

4

5

2016 2017

% o

f Tur

nove

r

Full Year

3.5 3.5

0

1

2

3

4

5

6

2016 2017

% o

f Tur

nove

r

2nd Half

0% +0.1%

Basic Earnings Per Share

32

18.50 19.75

0 3 6 9

12 15 18 21 24 27

2016 2017

HK C

ents

Full Year

11.63 12.22

0

2

4

6

8

10

12

14

16

2016 2017

HK C

ents

2nd Half

+5.1% +6.8%

2017 Financial Results Highlight – 2nd Half

2H2016 2H2017 Change

Number of Stores 582 585 +3

Group Turnover (HK$M) 2,532 2,667 +5.3%

Group Net Profit (HK$M) 88 93 +6.1%

Net Profit as % of Turnover 3.5% 3.5% -

Basic Earnings Per Share (HK cents) 11.63 12.22 5.1%

33

2017 Financial Results Highlight – Full Year 2016FY 2017FY Change

Number of Stores 587 585 -2

Group Turnover (HK$M) 4,871 5,094 +4.6%

Group Net Profit (HK$M) 140 150 +7.7%

Net Profit as % of Turnover 2.9% 3.0% +0.1%

Basic Earnings Per Share (HK cents) 18.50 19.75 +6.8%

Dividends (HK cents) Interim Dividend Final Dividend Special Dividend

3.5 13 27

4

14 -

+14.3% +7.7%

N/A 34

2018 OUTLOOK

35

2018 Outlook

Stagnant demand for Hong Kong consumers

Drastic shortage of frontline labour

Aggressive landlords

O2O retailing is the future

The importance of EFS (Easy, Fast & Simple)

36

37

ASN Fun & Novelty “Internet+”

Customer

The Future Is Bright & Clear

Quality & Profitable Growth Copyright © Circle K Convenience Stores (HK) Limited

THANK YOU !

38