22ndnd Quarter 2002 Results Quarter 2002 ResultsPresentationPresentation

A member of the Li & Fung (Retailing) GroupA member of the Li & Fung (Retailing) Group CRA Website: www.cr-asia.comCRA Website: www.cr-asia.com29 July 200229 July 2002

22

22ndnd Quarter 2002 Results Presentation Age Quarter 2002 Results Presentation Agendanda

22ndnd Quarter 2002 Financial Results Highlights Quarter 2002 Financial Results Highlights

2002 Update & Outlook2002 Update & Outlook

Questions & AnswersQuestions & Answers

33

22nd nd Quarter 2002 Financial Results HighlightsQuarter 2002 Financial Results HighlightsGroup Turnover – 2Group Turnover – 2ndnd Quarter 2002 Quarter 2002

972.91,140.7

1,305.1

326.5 343.4

0

500

1,000

1,500

HK$ Million

1999 Total 2000 Total 2001 Total 2nd Qtr2001

2nd Qtr2002

No. of Stores:No. of Stores: 114 114 123 123 146 146 132 132 151 151

+ 5%+ 5%

44

309.3 290.3

0

100

200

300

400

HK$ Million

2nd Qtr 2001 2nd Qtr 2002

22ndnd Quarter 2002 Financial Results Highlights Quarter 2002 Financial Results Highlights121 Stores Comparative Sales121 Stores Comparative Sales

- 6%- 6%

55

22nd nd Quarter 2002 Financial Results HighlightsQuarter 2002 Financial Results HighlightsGroup Turnover – June YTD 2002Group Turnover – June YTD 2002

972.9

1,140.7

1,305.1

301.9

326.5

322.6

343.4

0

500

1,000

1,500

HK$ Million

1999 Total 2000 Total 2001 Total June YTD2001

June YTD2002

No. of Stores:No. of Stores: 114 114 123 123 146 146 132 132 151 151

+ 6%+ 6%

628.4 666.0

66

22ndnd Quarter 2002 Financial Results Highlights Quarter 2002 Financial Results HighlightsGroup Net Profit – 2Group Net Profit – 2ndnd Quarter 2002 Quarter 2002

6.6

48.1

65.5

18.1 19.8

0

10

20

30

40

50

60

70

80

HK$ Million

1999 Total 2000 Total 2001 Total 2nd Qtr2001

2nd Qtr2002

+ 9%+ 9%

77

22ndnd Quarter 2002 Financial Results Highlights Quarter 2002 Financial Results HighlightsGroup Net Profit – June YTD 2002Group Net Profit – June YTD 2002

6.6

48.1

65.5

11.2

18.1

12.0

19.8

0

10

20

30

40

50

60

70

80

HK$ Million

1999 Total 2000 Total 2001 Total June YTD2001

June YTD2002

+ 8%+ 8%

29.3 31.8

88

22ndnd Quarter 2002 Financial Results Highlights Quarter 2002 Financial Results HighlightsNet Profit as % of Sales – 2Net Profit as % of Sales – 2ndnd Quarter 2002 Quarter 2002

0.7%

4.2%

5.0%5.5%

5.8%

0%

1%

2%

3%

4%

5%

6%

7%

8%

1999 Total 2000 Total 2001 Total 2nd Qtr2001

2nd Qtr2002

+ 0.3%+ 0.3%

99

22ndnd Quarter 2002 Financial Results Highlights Quarter 2002 Financial Results HighlightsNet Profit as % of Sales – June YTD 2002Net Profit as % of Sales – June YTD 2002

0.7%

4.2%

5.0%4.7% 4.8%

0%

1%

2%

3%

4%

5%

6%

7%

8%

1999 Total 2000 Total 2001 Total June YTD2001

June YTD2002

+ 0.1%+ 0.1%

1010

22ndnd Quarter 2002 Financial Results Highlights Quarter 2002 Financial Results HighlightsBasic Earnings Per Share – 2Basic Earnings Per Share – 2ndnd Quarter 2002 Quarter 2002

1.3

9.8 10.1

2.8 3.0

0

2

4

6

8

10

12

HK$ Cents

1999 Total 2000 Total 2001 Total 2nd Qtr2001

2nd Qtr2002

+ 7%+ 7%

1111

22ndnd Quarter 2002 Financial Results Highlights Quarter 2002 Financial Results HighlightsBasic Earnings Per Share – June YTD 2002Basic Earnings Per Share – June YTD 2002

1.3

9.8 10.1

1.8

2.8

1.8

3.0

0

2

4

6

8

10

12

HK$ Cents

1999 Total 2000 Total 2001 Total June YTD2001

June YTD2002

+ 4%+ 4%

4.84.6

1212

Why 2Why 2ndnd Quarter 2002 Favorable Results? Quarter 2002 Favorable Results? Higher at Gross Margin/Other IncomeHigher at Gross Margin/Other Income

30.4%31.0%

31.6%31.3%

33.2%

28%

30%

32%

34%

1999 Total 2000 Total 2001 Total 2nd Qtr2001

2nd Qtr2002

Gross Margin/Other Income as % of Sales

+ 1.9%+ 1.9%

1313

Why 2Why 2ndnd Quarter 2002 Favorable Results? Quarter 2002 Favorable Results? Offset By Higher Expenses as % of SalesOffset By Higher Expenses as % of Sales

Expenses as % of SalesExpenses as % of Sales 2002 vs 20012002 vs 2001

Store Operating ExpensesStore Operating Expenses (1.2%)(1.2%) HighHigh

erer

China Start-up ExpensesChina Start-up Expenses (0.1%)(0.1%) HighHigh

erer

1414

22ndnd Quarter 2002 Financial Results Highlights Quarter 2002 Financial Results Highlights

22ndnd Qtr 2001 Qtr 2001 22ndnd Qtr 2002 Qtr 2002

Group Turnover (HK$ Million)Group Turnover (HK$ Million) $326.5$326.5 $343.4$343.4 + 5%+ 5%

Group Net Profit (HK$ Million)Group Net Profit (HK$ Million) $18.1 $18.1 $19.8 $19.8 + 9%+ 9%

Net Profit as % of TurnoverNet Profit as % of Turnover 5.5%5.5% 5.8%5.8% + 0.3%+ 0.3%

Basic Earnings Per ShareBasic Earnings Per Share 2.8 Cents 2.8 Cents 3.0 Cents3.0 Cents + 7%+ 7%

1515

June YTD 2002 Financial Results HighlightsJune YTD 2002 Financial Results Highlights

June YTD 2001June YTD 2001 June YTD 2002June YTD 2002

Group Turnover (HK$ Million)Group Turnover (HK$ Million) $628.4$628.4 $666.0$666.0+ 6%+ 6%

Group Net Profit (HK$ Million)Group Net Profit (HK$ Million) $29.3 $29.3 $31.8 $31.8+ 8%+ 8%

Net Profit as % of TurnoverNet Profit as % of Turnover 4.7%4.7% 4.8%4.8%+ 0.1%+ 0.1%

Basic Earnings Per ShareBasic Earnings Per Share 4.6 Cents 4.6 Cents 4.8 Cents4.8 Cents+ 4%+ 4%

1616

2002 Update & Outlook2002 Update & Outlook

1717

2002 Update & Outlook2002 Update & OutlookCircle K Hong KongCircle K Hong Kong

Rising Unemployment, Continuing Rising Unemployment, Continuing

Deflation, Declining Consumer Deflation, Declining Consumer

ConfidenceConfidence

No Signs of RecoveryNo Signs of Recovery

Tough 2Tough 2ndnd Half 2002 Half 2002

1818

2002 Update & Outlook2002 Update & OutlookCircle K Hong Kong – Store GrowthCircle K Hong Kong – Store Growth

Beginning of YearBeginning of Year ::

146146

Opened So FarOpened So Far :: + 5 + 5

In ProgressIn Progress ::

+10+10

Target Store NumberTarget Store Number ::

170170

at End of the Yearat End of the Year

1919

2002 Update & Outlook2002 Update & OutlookCircle K Hong Kong TacticsCircle K Hong Kong Tactics

Focus on Managing Pricing, Focus on Managing Pricing,

Gross Profit & Controlling Gross Profit & Controlling

ExpensesExpenses

Aggressive Promotions Targeted Aggressive Promotions Targeted

at Youngstersat Youngsters

Develop Fast-growth Product Develop Fast-growth Product

Categories – Categories – Food Services, Food Services,

Phone Cards and Store ServicesPhone Cards and Store Services

2020

2002 Update & Outlook2002 Update & OutlookCircle K ChinaCircle K China

Notification of Approval from Beijing Notification of Approval from Beijing

SETC, MOFTEC & SAICSETC, MOFTEC & SAIC

Awaiting Written ApprovalAwaiting Written Approval

Taking Possession of Sites in AugustTaking Possession of Sites in August

Very Likely Store Openings in Very Likely Store Openings in

Sep/Oct 2002Sep/Oct 2002

2121

2002 Update & Outlook2002 Update & OutlookTo SummariseTo Summarise

Tough Hong Kong Market Slowing Tough Hong Kong Market Slowing

Profit GrowthProfit Growth

About to Commence Business in About to Commence Business in

Southern ChinaSouthern China

China Start-up Cost to IncreaseChina Start-up Cost to Increase

Volatility in Rate of Profit Growth in 2Volatility in Rate of Profit Growth in 2ndnd

Half 2002Half 2002

22ndnd Quarter 2002 Results Quarter 2002 ResultsPresentationPresentation

A member of the Li & Fung (Retailing) GroupA member of the Li & Fung (Retailing) Group CRA Website: www.cr-asia.comCRA Website: www.cr-asia.com29 July 200229 July 2002