Convenience Retail Asia Limited · HKEX:831

Convenience Retail Asia — Q3 2005 Earnings Presentation

25 slides from Convenience Retail Asia's earnings presentation, Oct 26, 2005

  1. Slide 1: 3rd Quarter 2005 Results Presentation

    3 Quarter 2005 Results rd Presentation A member of the Li & Fung (Retailing) Group 26 October 2005

  2. Slide 2: Hong Kong Retail Sales Value

    Hong Kong Retail Sales Value Year-on-year % Change 25 Jan – Aug 2005 Total Retail : +7.6% Supermarket : +5.6% 20 15 % 10 5 0 01/04 02/04 03/04 04/04 05/04 06/04 07/04 08/04 09/04 10/04 11/04 12/04 01/05 02/05 03/05 04/05 05/05 06/05 07/05 08/05 Source: Census and Statistics Department, HKSAR

  3. Slide 3: Guangzhou Retail Sales Value

    Guangzhou Retail Sales Value Year-on-year % Change Jan – Aug 2005 25 Total Retail : +13.1% 20 15 % 10 5 0 01/04 02/04 03/04 04/04 05/04 06/04 07/04 08/04 09/04 10/04 11/04 12/04 01/05 02/05 03/05 04/05 05/05 06/05 07/05 08/05 Source: Bureau of Statistics, Guangzhou

  4. Slide 4: Hong Kong Market 3rd Quarter 2005 Update

    Hong Kong Market 3rd Quarter 2005 Update ƒ Free newspapers ƒ Irrational rental increases ƒ Cigarette price war ƒ Competition heating up

  5. Slide 5: Hong Kong Market 3rd Quarter 2005 Developments

    Hong Kong Market 3rd Quarter 2005 Developments ƒ Started renovation to 3G

  6. Slide 6: Southern China & Macau Markets 3rd Quarter 2005 Update

    Southern China & Macau Markets 3rd Quarter 2005 Update ƒ Pace of new store opening picking up ¾ Guangzhou 35 ¾ Zhuhai JV stores 4 ¾ Macau JV stores 9 ¾ Total 48 ƒ Delay in obtaining approval for Dongguan Sun-High acquisition

  7. Slide 7: Group Turnover – 3rd Quarter

    2005 Financial Results Highlights Group Turnover – 3rd Quarter 2,000 1,736.5 * 1,515.8* 1,500 + 7% HK$ Million 1,000 466.8 * 501.4 500 0 2003 2004 3rd Qtr 2004 3rd Qtr 2005 No. of store – HK 186 205 197 223 No. of store - China 7 20 15 35 * Restated

  8. Slide 8: Marketing & Promotions

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  9. Slide 9: Group Turnover – Sep YTD

    2005 Financial Results Highlights Group Turnover – Sep YTD 2,000 + 14% 1,736.5* * 1,515.8 1,471.0 1,500 1,293.6* HK$ Million 454.2 398.3 1,000 515.4 428.4 500 466.8 501.4 0 2003 2004 Sep YTD 2004 Sep YTD 2005 No. of store – HK 186 205 197 223 No. of store - China 7 20 15 35 * Restated

  10. Slide 10: Improvement in Gross Margin / Other Income

    Improvement in Gross Margin / Other Income Gross Margin/Other Income as % of Sales (Excluding Interest) 36% +2.6% 35% 34.5% 34% % of Sales 33% * 32.3% * 32.2% 31.9% * 32% 31% 30% 2003 2004 3rd Qtr 2004 3rd Qtr 2005 * Restated

  11. Slide 11: Higher Store Operating Expenses

    Higher Store Operating Expenses ƒ Higher Rental & Staff Cost in HK ƒ More new stores in China 30% 24.8% 22.7%* 23.2%* 22.5%* 25% 7.1% 20% 6.5% 6.6% % of Sales 6.5% 15% 7.3% 7.9% 7.0% 6.9% 10% 5% 9.2% 9.3% 9.1% 9.8% 0% 2003 2004 3rd Qtr 2004 3rd Qtr 2005 Labour Cost Rental Cost Other Expenses * Resta

  12. Slide 12: Group Net Profit – 3rd Quarter

    2005 Financial Results Highlights Group Net Profit – 3rd Quarter 80 66.3 * 70 60.5 * 60 + 13% HK$ Million 50 40 30 20.2 * 22.8 20 10 0 2003 2004 3rd Qtr 2004 3rd Qtr 2005 * Restated

  13. Slide 13: Group Net Profit – Sep YTD

    2005 Financial Results Highlights Group Net Profit – Sep YTD 80 * + 12% 66.3 70 60.5 * 60 52.6 46.9 * HK$ Million 50 8.9 8.5 40 20.9 30 18.2 20 10 20.2 22.8 0 2003 2004 Sep YTD 2004 Sep YTD 2005 * Restated

  14. Slide 14: Net Profit as % of Sales – 3rd Quarter

    2005 Financial Results Highlights Net Profit as % of Sales – 3rd Quarter 6% + 0.3% 4.6% 5% 4.3% * 4.0% * 3.8%* 4% % of Sales 3% 2% 1% 0% 2003 2004 3rd Qtr 2004 3rd Qtr 2005 * Restated

  15. Slide 15: Net Profit as % of Sales – Sep YTD

    2005 Financial Results Highlights Net Profit as % of Sales – Sep YTD 6% 5% 4.0% * 3.8% * 3.6% * 3.6% 4% % of Sales 3% 2% 1% 0% 2003 2004 Sep YTD 2004 Sep YTD 2005 * Restated

  16. Slide 16: Basic Earnings Per Share – 3rd Quarter

    2005 Financial Results Highlights Basic Earnings Per Share – 3rd Quarter 12 9.9 * 10 9.1 * 8 + 0.4 Cent HK Cents 6 4 3.0 * 3.4 2 0 2003 2004 3rd Qtr 2004 3rd Qtr 2005 * Restated

  17. Slide 17: Basic Earnings Per Share – Sep YTD

    2005 Financial Results Highlights Basic Earnings Per Share – Sep YTD 12 * 9.9 * + 0.8 Cent 10 9.1 7.8 8 7.0 * HK Cents 1.3 1.3 6 3.1 2.7 4 2 3.4 3.0 0 2003 2004 Sep YTD 2004 Sep YTD 2005 * Restated

  18. Slide 18: 3rd Quarter 2005 Financial Results Highlights

    3rd Quarter 2005 Financial Results Highlights 3rd Qtr 2004 3rd Qtr 2005 Change Group Turnover (HK$ Million) 466.8* 501.4 +7% Group Net Profit (HK$ Million) 20.2* 22.8 +13% Net Profit as % of Sales 4.3%* 4.6% +0.3% Basic Earnings Per Share 3.0 Cents* 3.4 Cents +0.4 Cent * Restated

  19. Slide 19: Sep YTD 2005 Financial Results Highlights

    Sep YTD 2005 Financial Results Highlights Sep YTD 04 Sep YTD 05 Change Group Turnover (HK$ Million) 1,293.6* 1,471.0 +14% Group Net Profit (HK$ Million) 46.9* 52.6 +12% Net Profit as % of Sales 3.6%* 3.6% - Basic Earnings Per Share 7.0 Cents* 7.8 Cents +0.8 Cent * Restated

  20. Slide 20: 2005 Update & Outlook

    2005 Update & Outlook

  21. Slide 21: Circle K Hong Kong Outlook

    2005 Circle K Hong Kong Outlook ƒ Arrival of PRC tourist peaked out ƒ Gradual increase in retail sales from local consumer spending ƒ Free newspaper issue ƒ Rental peaked but pressure on lease renewal ƒ Inflation pressure on people cost

  22. Slide 22: Circle K China Outlook

    2005 Circle China Outlook ƒ Circle K Dongguan commences operations ƒ Complete Circle K Shenzhen license and infra-structure set up ƒ Circle K Guangzhou to reach 45 – 50 stores

  23. Slide 23: Forecast Year-End Number of Stores

    2005 Update & Outlook Forecast Year-End Number of Stores Circle K ƒ Hong Kong 234 ƒ Macau 12 ƒ Guangzhou 50 ƒ Dongguan 10 ƒ Zhuhai 5 ƒ Shenzhen 0 Total 311

  24. Slide 24: To Summarize

    2005 Update & Outlook To Summarize ƒ Consumer spending in Hong Kong market improving but overall operating environment tougher ƒ Circle K Southern China enters multi-city store growth ƒ China store number to increase drastically

  25. Slide 25: 3rd Quarter 2005 Results Presentation

    3 Quarter 2005 Results rd Presentation A member of the Li & Fung (Retailing) Group 26 October 2005

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