9M 2019 Results and Performance November 2019 Disclaimer These - PowerPoint PPT Presentation

Company Presentation 9M 2019 Results and Performance November 2019

Disclaimer These presentations and/or other documents have been written and presented by Puregold Price Club, Inc. (PGOLD). PGOLD is solely responsible for the accuracy and completeness of the contents of such presentations and/or other documents. Third parties, other than PGOLD, do not have any responsibility for or control over the contents of such presentations and/or other documents. No endorsement is intended or implied notwithstanding the distribution of this presentation and/or other documents during the analysts and investors calls and meetings of PUREGOLD. The materials and information in the presentations and other documents are for informational purposes only, and are not an offer or solicitation for the purchase or sale of any securities or financial instruments or to provide any investment service or investment advice. Head Office Address 2nd floor, Tabacalera Building, 900 Romualdez Street, Paco, Manila, 1007 Philippines 2

Investment Summary 1. Sustained economic growth of the Philippines 2. Exposure to growing & robust consumer sector 3. Visible growth pipeline in the next 5 years 4. Focused core target market per brand 5. Expansion of new store formats aimed at the broad-C market 6. Expansion to new geographic locations 7. Management focused on the sustainable and Long-Term growth of the company 3

Store roll-out through FY 2018 409 360 329 298 215 102 64 30 16 3 1 1998 2001 2006 2008 2010 2011 2013 2015 2016 2017 2018 First store Expansion Brand recognition Market leadership Rapid expansion via organic Continuing new stores roll-     The 2 nd largest Reader’s Digest new Puregold stores roll-out Opened in Launched loyalty out via organic geographic Asia’s “Most and acquisitions Mandaluyong program in 2001; hypermarket and expansion and acquisitions   Trusted Brands” City, Metro renamed as supermarket 2011 - Opened 38 new Acquired Company E with Manila Tindahan ni Aling retailer in the Puregold stores 15 stores in 2013  2012 – Opened 31 new  Puring in 2004 Philippines in terms NE Bodega 9 stores and  of net sales Between 2002 and Puregold stores; Acquired Budgetlane 8 stores 2006, launched an Parco supermarkets with 19 acquisitions in 2015 New format average of 3 new New format stores and S&R warehouse  B&W Supermarket introduction stores every year membership shopping club First format introduction - 2010 acquisition in 2017 - 2008 and expanded with 6 stores introduction operations in North and South Luzon Rapid store expansion from 1 to 409 stores in 20 years 4

Update on Puregold – 9M 2019 5

9M 2019 Results and Performance • Opened 17 new PGOLD stores; 1 S&R Warehouse in 9M 2019; closed 2 PGOLD store and 1 S&R QSR • Operating 423 stores in 9M 2019; with consolidated NSA of around 550,000 sqm • Consolidated net sales expanded by 10.3% in 9M 2019; Puregold stores sales accounted for about 77% of consolidated net sales • Gross profit grew by 7.6% in 9M 2019; with gross profit margin posted 16.6% • Operating income increased by 4.8% in 1H 2019; with operating margin at 6.7% • Consolidated Net income increased by 2.9% in 9M 2019; consolidated net profit margin at 4.1% PGOLD only net margin is at 3% while S&R net margin is 8.1%. • Core net income (excluding one-time gain in 2018) grew by 12.1% in 9M 2019. 6

Operating Performance – 9M 2019 Format Hypermarket, supermarket, extra Membership shopping S&R Puregold 23% Revenue contribution 77% 12,603 (14.8%) 5,618 (22.6%) Gross profit (PHP million) & Margin (%) 133 6.4 Total traffic (million) 637 4,065 Average net ticket (PHP) 9.0% 15.6% Net sales growth (%) 1.1% 8.6% Traffic growth (%) 7.8% 6.5% Average net ticket growth (%) 5.6% 8.4% Same Store net sales growth (%)* -3.3% 0.7% Same Store traffic growth (%)* 9.3% 7.6% Same Store average net ticket growth (%)* *Same Stores Growth for 2019 are based on stores opened as of end December 2017. 7

Operating Performance – 9M 2019 Breakdown of Stores (per format) Net Selling Area of Stores (in sqm) 800,000 486,722 518,862 537,965 550,843 Group 2016 2017 2018 9M 19 700,000 4,010 600,000 Hypermarket 147 171 208 222 4,126 3,509 2,715 87,470 500,000 83,048 72,904 Supermarket 100 103 104 103 62,037 400,000 Extra 30 35 42 44 300,000 459,363 442,449 450,791 421,970 S&R 12 14 16 17 200,000 100,000 S&R QSR 23 32 39 37 - NE & 2016 2017 2018 9M 19 Budgetlane 17 17 0 0 Puregold S&R only S&R QSR TOTAL 329 372 409 423 Traffic and Ave Ticket Size Traffic (in M) PGOLD S&R Puregold Only 2016 2017 2018 9M 19 2016 155 6.3 Metro Manila 110 114 125 128 2017 170 7.2 North Luzon 70 77 93 98 2018 178 8.2 South Luzon 80 90 101 104 9M 19 133 6.4 Visayas 9 20 25 28 Ave Ticket (in Php) PGOLD S&R Mindanao 8 8 10 11 2016 567 3,598 TOTAL 277 309 354 369 2017 577 3,679 2018 612 3,959 *NE Bodega and Budgetlane Stores are converted to Puregold Stores in 2018 9M 19 637 4,065 8

Store Portfolio – 9M 2019 Key statistics 9M 2019 Geographic coverage Total no. of  423 Caloocan BULACAN stores North Luzon  222 hypermarkets; Valenzuela (104 stores) 103 supermarkets; Quezon City No. of stores 44 extras Malabon Navotas per format Caloocan  17 S&Rs Marikina Metro Manila  37 S&R QSR (159 stores) San Juan Manila Mandaluyong RIZAL Consolidated  about 550,000 Pasig Visayas Manila Bay Makati net selling South Luzon Pateros square meters (113 stores) (34 stores) area Pasay Taguig Parañaque Mindanao (13 stores) Las Piñas Laguna de Bay Metro Manila 128 7 24 Muntinlupa CAVITE North Luzon 98 3 3 South Luzon 104 3 6 LAGUNA Visayas 28 2 4 Area with Puregold store coverage Mindanao 11 2 0 *NE Bodega and Budgetlane Stores are converted to Puregold Stores in 2018 369 17 37 9

Financial Performance – 9M 2019 Net sales (in Php billions) Gross profit & Margin (in PHP billions) 140.92 30 30.0% 23.84 124.49 28.0% 21.48 112.59 25 109.81 18.22 26.0% 19.38 99.57 16.94 20 24.0% 22.0% 15 20.0% 10 18.0% 17.0% 17.3% 16.0% 16.6% 17.2% 16.9% 5 14.0% 0 12.0% 2016 2017 2018 9M 18 9M 19 2016 2017 2018 9M 18 9M 19 Gross Profit GP Margin • Continuing strong revenue growth driven by the 354 Puregold stores and the 16 S&R stores in 2018 • Increasing costs of suppliers resulted to reduced marketing and promo support • Positive effect of Tax Reform law to Filipino consumers supported continuing growth in revenues 10

Financial Performance – 9M 2019 Other Operating Income (in PHP millions) Operating Expenses (in PHP millions) 4,000 20,000 40.0% 14.0% 17,840 3,500 13,707 15,516 35.0% 2,941 12.0% 2,307 2,692 3,000 11,929 12,929 15,000 30.0% 2,108 2,429 10.0% 2,500 25.0% 8.0% 2,000 10,000 20.0% 6.0% 1,500 15.0% 4.0% 2.2% 1,000 2.2% 2.1% 2.1% 5,000 12.5% 12.7% 2.1% 10.0% 12.2% 12.0% 11.8% 2.0% 500 5.0% - 0.0% - 0.0% 2016 2017 2018 9M 18 9M 19 2016 2017 2018 9M 18 9M 19 Other Income % of Sales OPEX % of Sales EBITDA & Margin (in Php millions) 15,000 40.0% 13,000 11,273 10,644 10,412 9,735 30.0% 9,919 11,000 9,000 20.0% 7,000 9.5% 9.8% 5,000 8.8% 8.5% 8.0% 10.0% 3,000 1,000 0.0% 2016 2017 2018 9M 18 9M 19 11 EBITDA EBITDA Margin

Financial Performance – 9M 2019 Operating Income/EBIT and Margins (in PHP millions) Net Income & Margins (in PHP millions) 7,500 25.0% 000 35.0% 8,941 8,652 6,520 000 8,097 7,600 6,500 5,840 30.0% 5,526 000 7,115 4,553 20.0% 4,422 5,500 25.0% 000 4,500 000 15.0% 20.0% 000 3,500 15.0% 000 10.0% 2,500 4.9% 7.0% 4.7% 000 4.6% 10.0% 7.2% 6.3% 7.1% 6.9% 4.4% 4.1% 000 1,500 5.0% 5.0% 000 500 - 0.0% (500) 0.0% 2016 2017 2018 9M 18 9M 19 2016 2017 2018 9M 18 9M 19 EBIT EBIT Margin Net Income NI Margin *Core Net Income (excluding one-off gain in 2018) grew by 12.1% in 9M 2019 12

Financial Performance – Puregold Only Revenues (in PHP Billions) Gross Profit & Margins (in PHP millions) 140 20,000 25.0% 109.47 16,898 15,681 120 98.62 14,451 12,604 23.0% 90.94 12,292 84.9 100 15,000 77.89 21.0% 80 10,000 19.0% 60 15.9% 17.0% 40 15.9% 15.8% 15.4% 5,000 14.8% 20 15.0% 0 - 13.0% 2016 2017 2018 9M 18 9M 19 2016 2017 2018 9M 18 9M 19 GP GP Margin EBITDA and Margin (in PHP millions) Net Profit & Margins (in PHP millions) 7,000 15.0% 9,500 25.0% 13.0% 6,000 4,522 6,932 6,868 11.0% 6,588 4,153 6,510 5,000 6,436 3,967 2,842 7,500 20.0% 2,525 9.0 4,000 5,500 15.0% 7.0 3,000 5.0 8.4% 3,500 10.0% 7.2% 7.6% 2,000 7.0% 4.4% 4.2% 6.3% 4.1% 3.0 3.6% 3.0% 1,000 1,500 5.0% 1.0 - -1.0% (500) 0.0% 2016 2017 2018 9M 18 9M 19 2016 2017 2018 9M 18 9M 19 NIAT NIAT Margin EBITDA EBITDA Margin 13 *Core Net Income (excluding one-off gain in 2018) increased by 1.8% in 9M 2019