Convenience Retail Asia Limited · HKEX:831

Convenience Retail Asia — Q3 2007 Earnings Presentation

29 slides from Convenience Retail Asia's earnings presentation, Nov 1, 2007

  1. Slide 1: Convenience Retail Asia Ltd 3rd Quarter 2007 Result Announcement

    Convenience Retail Asia Ltd 3rd Quarter 2007 Result Announcement 1 November 2007

  2. Slide 2: Agenda

    3rd Quarter 2007 Results Presentation Agenda ƒ Overall Hong Kong and Guangzhou Retail Markets Update ƒ 3rd Quarter 2007 Financial Results Highlights ƒ 2007 Update and Outlook

  3. Slide 3: 2007 HK Retail Sales Value

    2007 HK Retail Sales Value Year-on-year % Change 35 28.6 2007 YTD: + 10.6% 30 25 Year-on-year % 20 14.3 14.3 15.0 15 10.8 10.2 10 6.8 7.3 4.9 5 3.2 -1.5 0 -5 Mar May 2004 2005 2006 Apr Jan 2007 Feb Aug Jun Jul Source: Census and Statistics Department, HKSAR

  4. Slide 4: HK Consumer Price Index

    2007 HK Consumer Price Index Year-on-year % Change 4 2007 YTD: + 1.7% 3 2.4 Year-on-year % 2.0 2.0 2 1.6 1.6 1.3 1.2 1.3 1.5 1.0 1 0.8 0 -0.4 -1 Mar May 2004 2005 2006 Apr Feb Aug Sep Jan 2007 Jun Jul Source: Census and Statistics Department, HKSAR

  5. Slide 5: Guangzhou Retail Sales Value

    2007 Guangzhou Retail Sales Value Year-on-year % Change 2007 YTD: + 17.5% 30 25 22.1 20.5 20.1 19.8 Year-on-year % 20 17.1 17.8 15.0 15 12.1 13.2 13.2 10.0 10 5 0 May Mar 2004 2005 2006 Apr Jan 2007 Feb Aug Jun Jul Source: Bureau of Statistics, Guangzhou

  6. Slide 6: Guangzhou City Consumer Price Index

    2007 Guangzhou City Consumer Price Index Year-on-year % Change 6 2007 YTD: + 2.7% 5 4.6 4.4 Year-on-year % 4 3 2.8 2.3 2.3 2.4 2.3 1.9 2 1.7 1.5 1.0 1 0 May Mar 2004 2005 2006 Apr Feb Jan 2007 Aug Jun Jul Source: Bureau of Statistics, Guangzhou

  7. Slide 7: 3rd Quarter 2007 Financial Results Highlights

    3rd Quarter 2007 Financial Results Highlights

  8. Slide 8: No. of Stores – Circle K Group

    2007 Financial Results Highlights No. of Stores – Circle K Group 3rd Qtr 2006 3rd Qtr 2007 ƒ Circle K Hong Kong 249 265 ƒ Circle K Guangzhou 47 60 ƒ Circle K Dongguan 7 9 ƒ Circle K Shenzhen 2 3 CRA Operated Circle K Stores 305 337 ƒ Zhuhai J.V. 6 10 ƒ Macau J.V. 15 15 Total Circle K Stores 326 362

  9. Slide 9: No. of Stores – Saint Honore Group

    2007 Financial Results Highlights No. of Stores – Saint Honore Group 3rd Qtr 2007 ƒ Saint Honore Hong Kong 76 y Cake Shop 62 y Bread Boutique 14 ƒ Saint Honore Macau 7 ƒ Saint Honore Guangzhou 9 Total Saint Honore Stores 92

  10. Slide 10: No. of Stores – CRA Group

    2007 Financial Results Highlights No. of Stores – CRA Group 3rd Qtr 2006 3rd Qtr 2007 ƒ Circle K Group 326 362 ƒ Saint Honore Group - 92 Total Number of Stores 326 454

  11. Slide 11: Group Turnover – 3rd Quarter

    2007 Financial Results Highlights Group Turnover – 3rd Quarter 2,500 2,231.2 1,995.2 2,000 37.5% HK$ Million 1,500 1,000 * 810.7 589.8 176.8 500 645.6 0 2005 2006 3rd Qtr 2006 3rd Qtr 2007 Circle K St Honore * After consolidation adjustment (less inter-group sales HK$11.7M)

  12. Slide 12: Group Turnover – Sep YTD

    2007 Financial Results Highlights Group Turnover – Sep YTD 3,000 28.2% 2,500 2,231.2 *2,134.3 1,995.2 356.1 HK$ Million 2,000 1,665.0 1,500 1,000 1,800.7 500 0 2005 2006 Sep YTD Sep YTD 2006 2007 Circle K St Honore * After consolidation adjustment (less inter-group sales HK$22.5M)

  13. Slide 13: Gross Margin / Other Income

    2007 Financial Results Highlights Gross Margin / Other Income 42 3.9% 40 37.0 % of Turnover 38 36 34 33.0 33.2 33.1 32 30 2005 2006 3rd Qtr 2006 3rd Qtr 2007 * Excluding interest income

  14. Slide 14: Store Operating Expenses

    2007 Financial Results Highlights Store Operating Expenses 35 2.3% 30 26.4 24.5 24.7 24.1 25 % of Turnover 20 15 10 5 0 2005 2006 3rd Qtr 2006 3rd Qtr 2007

  15. Slide 15: Circle K Group Store Operating Expenses

    2007 Financial Results Highlights Store Operating Expenses Circle K Group Store Operating Expenses 30 24.5 24.7 24.1 24.8 25 % of Turnover 7.2 6.7 7.0 7.0 20 15 8.2 7.9 8.1 8.3 10 5 9.4 9.8 9.0 9.5 0 2005 2006 3rd Qtr 2006 3rd Qtr 2007 Labour Cost Rental Cost Other Expenses

  16. Slide 16: Group Net Profit – 3rd Quarter

    2007 Financial Results Highlights Group Net Profit – 3rd Quarter 100 75.1 20.3% 80 73.6 HK$ Million 60 40 27.8 23.1 20 0 2005 2006 3rd Qtr 2006 3rd Qtr 2007

  17. Slide 17: Group Net Profit – Sep YTD

    2007 Financial Results Highlights Group Net Profit – Sep YTD 100 17.6% 73.6 75.1 80 65.3 55.6 HK$ Million 60 40 20 0 2005 2006 Sep YTD Sep YTD 2006 2007

  18. Slide 18: Net Profit By Market

    2007 Financial Results Highlights Net Profit By Market 3rd Qtr 2006 3rd Qtr 2007 Change (HK$M) (HK$M) (HK$M) Hong Kong Market 28.4 31.3 2.9 China Market (5.3) (3.5) 1.8 Total 23.1 27.8 4.7

  19. Slide 19: Net Profit as % of Turnover – 3rd Quarter

    2007 Financial Results Highlights Net Profit as % of Turnover – 3rd Quarter 5 0.5% 3.9 3.7 4 3.4 3.4 % of Turnover 3 2 1 0 2005 2006 3rd Qtr 2006 3rd Qtr 2007

  20. Slide 20: Net Profit as % of Turnover – Sep YTD

    2007 Financial Results Highlights Net Profit as % of Turnover – Sep YTD 5 0.2% 3.7 4 3.4 3.3 3.1 % of Turnover 3 2 1 0 2005 2006 Sep YTD 2006 Sep YTD 2007

  21. Slide 21: Basic Earnings Per Share – 3rd Quarter

    2007 Financial Results Highlights Basic Earnings Per Share – 3rd Quarter 15 10.94 11.10 12 11.7% HK Cents 9 6 3.42 3.82 3 0 2005 2006 3rd Qtr 2006 3rd Qtr 2007

  22. Slide 22: Basic Earnings Per Share – Sep YTD

    2007 Financial Results Highlights Basic Earnings Per Share – Sep YTD 15 10.9% 10.94 11.10 12 9.13 8.23 HK Cents 9 6 3 0 2005 2006 Sep YTD 2006 Sep YTD 2007

  23. Slide 23: 3rd Quarter Highlights

    2007 Financial Results Highlights 3rd Quarter 3rd Qtr 2006 3rd Qtr 2007 Change Number of Stores 326 454 +39.3% Group Turnover (HK$M) 589.8 810.7 +37.5% Group Net Profit (HK$M) 23.1 27.8 +20.3% Net Profit as % of Turnover 3.9% 3.4% -0.5% Basic Earnings Per Share 3.42 Cents 3.82 Cents +11.7%

  24. Slide 24: September YTD Highlights

    2007 Financial Results Highlights September YTD Sep YTD Sep YTD Change 2006 2007 Group Turnover (HK$M) 1,665.0 2,134.3 +28.2% Group Net Profit (HK$M) 55.6 65.3 +17.6% Net Profit as % of Turnover 3.3% 3.1% -0.2% Basic Earnings Per Share 8.23 Cents 9.13 Cents +10.9%

  25. Slide 25: 2007 Update and Outlook

    2007 Update and Outlook

  26. Slide 26: Hong Kong Market Outlook

    2007 Hong Kong Market Outlook 1. + Consumers willing to spend + inflation kicking in - smoking ban and warning graphics 2. Successful “Always Something New” Campaign, gaining momentum 3. Rental increase becoming the major issue 4. Labour market getting tighter 5. Head-to-head competition happening e

  27. Slide 27: Southern China Market Outlook

    2007 Southern China Market Outlook 1. Sales continues to be strong 2. Inflation at worrying level 3. Franchising ready to be rolled out 4. Cigarette licenses for new stores a major issue 5. Focus on increasing number of high DSPS and store contribution stores in Southern China 6. Will finish 2007 wi

  28. Slide 28: Market Outlook To Summarize

    2007 Market Outlook To Summarize ƒ Favourable consumer sentiments and strong performance ƒ Inflation and increase in operating expenses the major concerns ƒ Contribution from Saint Honore business in Q4 not as significant ƒ Total Circle K and Saint Honore stores to reach 470 by end of year ƒ Solid c

  29. Slide 29: Thank You!

    Thank You!

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