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Modern Beauty Salon Holdings Limited (HKSE: 919) Corporate Introduction

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Disclaimer

This presentation contains forward-looking statements that involve risks and uncertainties. These statements are generally indicated by the use of forward-looking terminology such as “believe”, “expected”, “anticipate”, “estimate”, “aim”, “intend”, “plan”, “will”, “may”, “should” or other similar words are considered as forward-looking statements. Such forward-looking statements merely reflects the views of the management of the Company on the day of announcement. You should not place any reliance on any of these forward-looking statements. The Company also does not guarantee that the future results or happenings will be consistent with such forward-looking statements. Modern Beauty Salon Holdings Limited does not make any guarantee, representation or warranty as to the adequacy, accuracy, completeness, reliability or fairness of any such information and opinion contained in this material.

Content

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Introduction & Business Review 4

Future Plan 26

Appendix 31

Financial Review 13

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Introduction & Business Review

Beauty & Wellness services in HK, Singapore & Malaysia

Beauty & Wellness services in Mainland China

Institutional Investor Mutual Fund Populus

Nice Sound Investment Ltd.

(BVI)

Ms. Tsang Yue, Joyce (Founder & Chairperson)

Goldlite Development Limited

Milestone

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Expansion to SE Asia Market

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Enhance the Group’s market share in Asia and boost brand recognition

• Seize the opportunity in the beauty care market in Southeast Asia and established footholds in Singapore and Malaysia

• Acquisition of the beauty care service business of Zegna Management Limited and its subsidiaries, in Singapore and Malaysia, at a consideration of HK$ 250 million

• Acquisition completed on 10 Jan 2012

• 12 centres in total: 9 in Singapore; 3 in Malaysia

• Turnover contributed in Year 2011/12 amounted to HK$104 million

As at 31 March 2012 No. of shops

Total GFA* (sq. feet)

Avg. GFA* (sq. feet)

Hong Kong 29 257,000 8,900

Mainland China 10 48,799 5,100

SE Asia 13 31,782 2,800

Service centres 52 333,900 6,700

Retail outlets (Hong Kong) 16

Total 68

Service Centres & Retail Network

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Hong Kong

4 shops in Beijing

3 shops in Shanghai

3 shops in Guangzhou

Kuala Lumpur

Singapore

Seung Wan, Central, Admiralty, Causeway Bay, Happy Valley, Aberdeen,

North Point, Tai Koo Shing etc

Tsim Sha Tsui, Hung Hom, Kwun Tong, Mong Kok, Mei Fu, Lai Chi Kwok,

Sun Po Kong, To Gwa Wan etc

Tuen Mun, Yuen Long, Tai Po, Ma On Shan, Fo Tan, Tsuen Wan,

Kwai Fong, Tseung Kwan O, Sheung Shui, Kwai Chung, Fan Ling etc

29 Service Centres

10 be Beauty Shops

6 p.e.n Shops

New Territories

Kowloon

Hong Kong

*GFA: Gross Floor Area

Product Sales

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• Turnover amounted over HK$46.8 million, soared by 14.4%

• Continued to strengthen sales network

• Operating 16 points of sales currently

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Our Brands “p.e.n”、”be”、”Ferrecare”，

Overseas Production in Switzerland and Australia

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Other Brands with Distribution Rights “Advanced Natural”、“BeYu”and“Jean Klebert”

Upcoming New Brand under Distribution Right - Bioline

Service Upgrade

Real-time appointment system with electronic signature confirmation is developed for customers’ convenience

Customers can also make the appointments through mobile phones with SMS confirmation by automatic system

The system is tested and updated regularly to ensure the confidentiality of the customers’ information

Strengthened market promotions to increase market recognition during the year

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Financial Review

2011/12 Results Highlights

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Annual turnover increased by 5.3% to approximately HK$757 million

Turnover of beauty and wellness services increased by approximately 5% to about HK$710 million

Net profit attributable to shareholders for the year was approximately HK$82 million, reduced by approximately 8% comparing to year 2011

The Board of Directors recommended the distribution of final dividend of HK4.25cents, contributing to a full year dividend of HK7.63cents

Acquisition of the beauty care service business of Zegna Management Limited and its subsidiaries, in Singapore and Malaysia, at a consideration of HK$250 million during the year

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During the year, the Group acquired the beauty service business in Singapore & Malaysia; such geographical expansion led to an increase of the Group’s turnover and net profit to HK$757m and HK$82.14m respectively, from HK$587m and HK$43.98m last year (as announced 2010/11).

Thus, for investors’ reference, the Group announced a “Positive Profit Alert” after the end of the financial year. During the audit period, due to the acquisition of the business in Singapore and Malaysia, as suggested by the auditor, the Group restated the 2010/11 annual results according to Accounting Guideline 5 “ Merger Accounting For Common Control Combinations”, which to include pre-acquisition performance of the Singapore & Malaysia business in the restated result.

After audit, the turnover of net profit of 2010/11 are restated to HK$718m and HK$89.26m respectively. Hence, the annual increment in the net profit is affected and changed to decrement on the accounting book.

2011/12 Results Highlights (Cont’d)

HK$ ’000 For the Year ended 31 March

2012 2011

(2012 announced) Change

Turnover 756,605 718,230 +5.3%

Profit before tax 101,357 107,491 -5.7%

Profit for the year 82,137 89,263 -8.0%

Earnings per share 11.19 cents 12.33 cents -9.2%

Interim dividend per share 3.38 cents 1.40 cents +141.4%

Final dividend per share 4.25 cents 2.88 cents +47.6%

Full year dividend per share 7.63 cents 4.28 cents +78.3%

Financial Summary

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HK$ ’000 2012 2011 Change

Deferred Revenue 648,623 567,627 +14.3%

HK$ ’000 For the Year ended 31 March

2012 2011

(2011 announced) Change

Turnover 756,605 586,527 +29.0%

Profit before tax 101,357 51,810 +95.6%

Profit for the year 82,137 43,975 +86.8%

Earnings per share 11.19 cents 6.07 cents -84.3%

Interim dividend per share 3.38 cents 1.40 cents +141.4%

Final dividend per share 4.25 cents 2.88 cents +47.6%

Full year dividend per share 7.63 cents 4.28 cents +78.3%

Financial Summary

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HK$ ’000 2012 2011 Change

Deferred Revenue 648,623 587,834 +10.3%

69%

16%

10% 5%

Beauty & Skin Care Slimming Spa Product Sales

498

614

786

662

431

718 757

0

100

200

300

400

500

600

700

800

900

2006 2007 2008 2009 2010 2011 2012

Turnover

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Turnover By Business Segments

2011

Major sources of growth

• Remarkable growth in beauty & skin care and product sales • Optimistic growth in the turnover of Hong Kong business • Growth of 9.3% in sales of prepaid beauty package

to HK$790 million

74%

15%

5%

6%

2012

502

114 54 41

557

113 35 47 0

100

200

300

400

500

600

Beauty & Skin Care Slimming Spa Product Sales

2011

2012

HK$ million

94%

6%

Services Product Sales

77%

5% 17%

2%

Hong Kong Mainland China Singapore Malaysia

Turnover Analysis

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Geographical Segments Business Segments

2011

94%

6% 2012

-

2011

677

41

710

47 0

200

400

600

800

Services Product Sales

2011

2012

82%

5% 12%

2% 2012

553

33 120 13

616

36 92 12

0

100

200

300

400

500

600

700

HK Mainland China Singapore Malaysia

2011

2012

11.4%

9.1%

HK$ million

HK$ million

4.9%

14.6%

23.8 28.2

8.8 11 11

3.0%

4.3%

2.1%

1.5% 1.5%

0.0%

1.0%

2.0%

3.0%

4.0%

5

10

15

20

25

30

2008 2009 2010 2011 2012

Cost Analysis

20 20

Employee Expenses

Advertising Costs

274

333

254

343 367

35%

50%

59%

48% 48%

0%

10%

20%

30%

40%

50%

60%

150

200

250

300

350

400

2008 2009 2010 2011 2012

80

112 109 115 115

10%

17%

25%

16% 15%

0%

5%

10%

15%

20%

25%

50

60

70

80

90

100

110

120

130

140

2008 2009 2010 2011 2012

Occupancy Costs

HK$ million

HK$ million % of Turnover

% of Turnover

% of Turnover

% of Turnover % of Turnover

HK$ million % of Turnover

123

177

227

17

(41)

89 82

25%

29% 29%

2.6%

N/A

12.4%

10.9%

-5%

0%

5%

10%

15%

20%

25%

30%

-50

0

50

100

150

200

250HK$ million

2006 2007 2008 2009 2010 2011 2012

NP Ratio

NP Ratio

298 364

490

329

162

355 371

60% 59% 62%

48%

37%

49% 49%

0%

10%

20%

30%

40%

50%

60%

70%

0

100

200

300

400

500

600HK$ million

2006 2007 2008 2009 2010 2011 2012

GP Ratio

Profits and Profit Ratios

Gross Profit (GP) Net Profit (NP)

GP Ratio

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Capital Expenses

44

157

59

153

23 47

0

20

40

60

80

100

120

140

160

180

HK$ million

2007 2008 2009 2010 2011 2012

Capital Expenses are mainly for:

•Renovation for the leased properties

•Vehicle expenses

•Equipment and Machines

•The increase of the capital expenses for the year was mainly due to the expansion of service network in Hong Kong and SE Asia

The capital expenses excludes the acquisition of properties; Acquisition of properties in 2010 was HK$135 million, HK$18 million in actual; Acquisition of property in 2008 was HK$93 million, HK$64 million in actual

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Cash Position

• The Group keeps the cash for routine operating expenses, e.g. procurement of skin care and wellness products, materials and consumables for beauty and wellness service and others (including Employees’ salaries, rent etc.)

• The remaining amount is mainly kept in saving account or as time deposit

HK$ ’000 2012 2011 Change

Cash & bank balances 484,426 449,495 +7.8%

Pledged bank deposits 7,141 7,160 -0.3%

Receivables, deposits, prepayments etc

217,466 177,219 +22.7%

For the Year Ended 31 March

2012 2011 2010

Net Assets (HK$ 000’) 272,143 281,529 196,007

Number of Shares, with HK$0.1 face value each (000’)

Issued ordinary shares at 1 April 723,520 723,520 723,520

Effect of conversion of convertible note 10,690 - -

Weighted average no. of ordinary shares for the purpose of calculating basic earnings per share

734,210 723,520 723,520

Net Asset per Share (HK$) 0.37 0.39 0.27

Net Assets

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Financials– Peer Comparison

1On 4 July 2012；on the basis of annual result 2011/12

2On 4 July 2012；on the basis of annual result 2011

3On 4 July 2012；calculated on the basis of final dividend of 2011/12 (listed on 13 December 2011)

4F/Y 2011/12；net profit of beauty & wellness service business to the entire net profit of company

5F/Y 2011；net profit of beauty service business to the entire net profit of company

Modern Beauty（919） Water Oasis（1161） Perfect Shape（1830）

P/E 8.4¹ 10.1² 5.6¹

Dividend Yield 0.08¹ 0.10²

0.05³

Proportion of profits from Beauty Services business to overall profits

80.9%⁴

68.3%⁵ N/A

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Future Plans

Staff Training & Welfare

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In order to maintain leadership in delivering services, quality training programs are updated from time to time to focus on latest and most popular services.

Ms. Joyce Tsang, with dedication and passion in her profession, has contributed greatly in the betterment of the beauty service industry in Hong Kong and the Asia Region.

“Beauty Expert International College” was established in 2003. It is a beauty training college offering training to both internal and external beauty consultants recognized by the industry.

The college had trained numerous professional beauty consultants over 10 years. These qualified specialists have pursued a successful career either in Modern Beauty or in the beauty service industry and some have been promoted to management level.

Service programs and training are updated from time to time with the industry’s latest product knowledge.

Staff Management

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(Up to 31 March 2012)

No. of Centres

Total Staff

No. of Frontline Staff

No. of Supporting

Staff

Hong Kong 45 1,452 1,306 146

Mainland China 10 153 121 32

1,605 1,427 178

S.E. Asia 13 245 245 0

Total 68 1,850 1,672 178

New Service Centres

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For expansion purpose of Beauty Service business, the Group will open more service centres in the coming year:

Rooms Opening in

Hong Kong

Shop 30, G/F , Ma On Shan Plaza 5, Ma On Shan 7 Rooms July 2012

11/F World-Wide House, Central 23 VIP Rooms; 34 Rooms Aug 2012

1 & 2/F, Paradise Square, 3 Kwong Wa St., Mong Kok 14 VIP Rooms; 15 Rooms Year end of 2012

Arcadia Court, Chengdu, China 15 Rooms 2nd Half of 2012

Bedok, Singapore 9 Rooms Launched

Future Plans

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Product Sales

Year 2012/13： Expected to develop 50 retail outlets under the brand “p.e.n”:

• Hong Kong： To develop 15 retail outlets under the brand “p.e.n”; To reconstruct 10 retail outlets under “be” into “p.e.n” retail outlets

• Singapore/ Malaysia：To develop 15 “p.e.n” retail outlets

• Mainland China: To develop 10 “p.e.n” retail outlets

Beauty service

Year 2012/13：Strengthen the Market Coverage

• Re-positioning in the PRC’s market; Focus on expansion with acquisitions in Mainland China

• Maintain steady development in Hong Kong

Target to develop in the second/ third-tiered cities in Mainland China, both service centres and retail shops of beauty products

附錄

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Appendix

Three Years Financial Summary

Consolidated Results (HK$ ‘000) Up to 31st March of the Year

2012 2011 2010

Turnover 756,605 718,230 430,750

Profit/(loss)before tax 101,357 107,491 (54,392)

Income tax（expenses）/credit (19,220) (18,228) 13,147

Profit/(loss)for the year 82,137 89,263 (41,245)

Consolidated assets and liabilities (HK$’000)

Total non-current assets 288,824 276,813 265,507

Total current assets 729,920 653,128 512,922

Total assets 1,018,744 929,941 778,429

Total non-current liabilities (4,556) (37) (53)

Total current liabilities (742,041) (648,375) (582,369)

Total liabilities (746,597) (648,412) (582,422)

Net assets 272,147 281,529 196,007 32

Brands

Beauty and Facial care Services

Most Consumed Facial Programs

Light For Cyclone Radio Frequency Cyclotron frequency compact bipolar treatment uses clinically proven RF technology, with good shaping, firming and lifting effect. More effective in stimulating the secretion of collagen, atrophy of bone collagen to fill the gap, so that cells increase the amount of exercise and excess body toxins drain away. With the continued proliferation of bone collagen and rearranging, an increase of dermal thickness and density, can immediately feel the upward skin firming effect.

Treatment For Micro Tightening Facial Reshape the contours of fiber surface instrument has Roboderm patented technology, the use of different slots of the roller nest covered with the treatment head of the treatment site have MMAS (Multi-Micro Alveolar Stimulation) micro-cavity physical stimulation. At the same time head of Xichuo through roller treatment, the skin being one of 1,180 per square decimeter micro-cavity physical stimulation, without a point in the pumping force pull, also on the thickness of tissue irritation, and thus not to hurt the skin.

Treatment For Arizona Stone Facial Minerals using a special stone from Arizona coupled with the natural extract of aromatherapy massage oil, heating the mineral stone massage can stimulate blood circulation, accelerate metabolism and help rid the body of toxins. Through long-term ion exchange, softening water, health beauty, meditation diastolic pressure effect.

Treatment For Royal Jelly Honey White tightening treatment to help skin deep clean, efficient burning of fat and lean muscle; to help tighten pores and remove wrinkles, promote skin absorption of nutrients and water, moisture repair skin, the skin becomes smooth and delicate.

Light For Thermastar ThermaStar is a highly sophisticated TriPolar Radio Frequency (RF) device that minimizes the pain and maximizes the results. By targeting specific tissue layers direct, it uses less energy than any other RF technology and does not need to be cooled down after use. This unique function also means treatments are virtually pain-free with no skin cooling required. It is the ultimate non-invasive weapon in combating skin ageing, cellulite and subcutaneous fat deposits.

Slimming Services

Most Consumed Slimming Programs

Slimming For Lymph body by hand The lymphatic system is a critical part of the circulatory system. Massaging of the lymphatic vessels can stimulate circulation. This treatment covers over 700 lymph nodes in the body and is effective for detoxification and improve the immune system.

Slimming For Quantum Effect Slimming Treatment Vacuum and quantum effect can stimulate lymphatic system, reduce congestion, enhance blood circulation and cells metabolic rate. This is an effective treatment for detoxification and improve body shape.

Slimming For Cyclone Radio Frequency Treatment Cyclone Radio Frequency heats up the water containing tissues under control without letting them to go deeper tissues. This has the effect of dissolving of the fat tissue, increase of collagens and renovation of the connective tissue leading to slimming, loosing weight, disappearing of the cellulites, recovery, overcoming the loosening, disappearing of the wrinkles.

Slimming For Cavition Treatment CAVITATION – ULTRAPORAZIONER generates pulsating ultrasound waves across the skin surface to reduce localized fat tissue. Ultrasonic sound waves focus their energy in the subcutaneous fat, hitting the fat cells under the skin and causing them to vibrate and to break up the cell membranes. Once the fat cells are broken down, they are transported out of the body through the lymphatic system. The destroyed fat cells will be released from the body system naturally.

Slimming For Micro Slimming Treatment An exclusive Roboderm® technique, this treatment employs hand pieces with two rollers, each equipped with 132 micro alveoli that create the so-called MMAS: Multi Micro Alveolar Stimulation. The skin receives, in this way and at each passage, a total of 1180 micro stimulations per square decimeter! The micro alveoli in the rollers use fractal suction to stimulate the micro vacuoles in the tissue, which is thus treated homogenously and precisely. The benefits of this treatment are appreciable right from the first minutes of treatment, thanks to the profound feeling of pleasure and well-being it induces.

Spa Services

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Most Consumed Slimming Programs

Hot Stone Massage The heat of hot stone will transmit to the body with essential oils and unique massage to help balance the body energy, stimulate blood circulation, stimulate the body lymphatic system, so that more healthy body, in order to help to reduce fatigue.

Shoulder Ginger Bag Therapy Massage The health benefits of ginger are primarily due to ginger's exceptional antioxidant content. The primary job of antioxidants is to protect cells against the oxidative stress caused by free radicals, considered to be the primary cause of the aging process. This treatment can also help to relax the muscles strain to accelerate the foot blood circulation, improve water retention and relieve the periodic discomfort of women.

Deep Sea Shell Spa Facial This series of products derived from non-polluted pure pearl ingredients, to help replenish the collagen molecules as fine pearls, easy for the skin absorb, and accelerated skin regeneration, to maintain soft moisture skin.

Soy Milk Spa Facial Soybeans scrub can help to remove blackheads and clean pores which make the skin shiny, soft and elastic, also help to reduce fine lines and wrinkles around the eye area.

Organic Smoothing Spa Facial Organic rice contains natural water-soluble vitamins, protein, minerals and trace elements, which can promote detoxification, and increase the metabolism of skin cells, preventing cell aging, and improving the metabolism of skin cells. This treatment is especially good for oily skin, acne, wrinkles, freckles, sensitive, dry or dry skin.

Exclusive Premium Facial Products - by Be, P.E.N., Ferrecare, Jean Klebert, Advance Natural, BeYu

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Most Consumed Facial Products

Vit A Illuminating Serum by Jean Klebert Removal of dead skin cells and moistening of skin, leaving skin clear Rich in anti-oxidant, able to combat free radicals, leaving skin radiant and clean Effective for suppressing melanin, making skin fair and healthy

Vit A Eye Cream by Jean Klebert Drastically reduces the depth of subtle wrinkle lines and instantly moisturizes the delicate eye-contour area. Also imporoves skin texture and tone, soothes calms and reduces periocular sweelling

Collagen Regenerating Cleanser by be Deep Cleansing and moisturizes skin Amino acid forms little protein molecules to improve secretion Increases skin elasticity and prevents wrinkle formation

C.B. Formula Rich Moisturizing Serum by Ferrecare Booster of cells activity Skin protecting and keep it moisturizing

C.B. Formula Resilience Lifting Serum by Ferrecare Enriched with active plant ingredients, improve skin elasticity and firmness, reduce fine lines, skin cells and promote rehabilitation of antioxidant effectively

Thank you！

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