3rd Quarter 2002 Results Presentation CRA Website: www.cr-asia.com 31 October 2002 A member of the Li & Fung (Retailing) Group
Hong Kong Retail Value Change Year-on-Year % Change * Source – HKSAR Census and Statistics Department
3rd Quarter 2002 Results Presentation Agenda 3rd Quarter 2002 Financial Results Highlights Update & 2002 Outlook Questions & Answers
3rd Quarter 2002 Financial Results Highlights Group Turnover 3rd Quarter 2002 + 5% No. of Store: 114 123 146 141 157
3rd Quarter 2002 Financial Results Highlights 121 Stores Comparable Sales - 5%
3rd Quarter 2002 Financial Results Highlights Group Turnover Sep YTD 2002 + 6% 1,032.8 978.8 No. of Store: 114 123 146 141 157
3rd Quarter 2002 Financial Results Highlights Group Net Profit – 3rd Quarter 2002 + 3%
3rd Quarter 2002 Financial Results Highlights Group Net Profit – Sep YTD 2002 + 6% 52.5 49.5
3rd Quarter 2002 Financial Results Highlights Net Profit as % of Sales – 3rd Quarter 2002 - 0.1%
3rd Quarter 2002 Financial Results Highlights Net Profit as % of Sales – Sep YTD 2002
3rd Quarter 2002 Financial Results Highlights Basic Earnings Per Share – 3rd Quarter 2002
3rd Quarter 2002 Financial Results Highlights Basic Earnings Per Share – Sep YTD 2002 + 3% 7.7 7.9
Why 3rd Quarter 2002 Favorable Results Why 3rd Quarter 2002 Favorable Results? Higher Gross Margin/Other Income + 0.8%
Why 3rd Quarter 2002 Favorable Results Why 3rd Quarter 2002 Favorable Results? Offset By Higher Expenses as % of Sales Expenses as % of Sales 2002 vs 2001 Store Operating Expenses (0.7%) Higher China Start-up Expenses (0.1%) Higher
3rd Quarter 2002 Financial Results Highlights 3rd Qtr 2001 3rd Qtr 2002 Group Turnover (HK$ Million) 350.4 366.8 + 5% Group Net Profit (HK$ Million) 20.2 20.8 + 3% Net profit as % of Sales 5.8% 5.7% - 0.1% Basic Earnings Per Store 3.1 Cents 3.1 Cents -
Sep YTD 2002 Financial Results Highlights Sep YTD 2001 Sep YTD 2002 Group Turnover (HK$ Million) 978.8 1,032.8 + 6% Group Net Profit (HK$ Million) 49.5 52.5 + 6% Net profit as % of Sales 5.1% 5.1% - Basic Earnings Per Store 7.7 Cents 7.9 Cents + 3%
Update & 2002 Outlook
Update & 2002 Outlook Circle K Hong Kong Rising Unemployment, Continuing Deflation, Declining Consumer Confidence No Signs of Recovery Tough 4th Quarter 2002 * Source – HKSAR Census and Statistics Department
Update & 2002 Outlook Circle K Hong Kong – Store Growth Beginning of Year : 146 Opened So Far : + 11 Construction in Progress/ : + 8 Committed Lease Target Store Number : 170 at End of the Year
Update & 2002 Outlook Circle K Hong Kong Tactics Focus on Managing Pricing, Gross Profit & Controlling Expenses Aggressive & Creative Promotions Develop Fast-growth Product Categories – Food Services, Phone Cards and Store Services
Update & 2002 Outlook Circle K China Obtained Business License 1st Store Ready, Official Opening – 17 November 2002 2nd Store Under Construction Grand Opening – 14 December 2002
Update & 2002 Outlook To Summarise Tough Hong Kong Market Slowing Profit Growth About to Commence Business in Southern China China Start-up Cost to Increase 4th Quarter Profit Growth Under Pressure Fast Store Growth Starting in 2003
Convenience Retail Asia Limited Just Won HKRMA 2002 Service & Courtesy Award Best Under A Billion 200 Companies for 2002 Superbrands Hong Kong 2002