FORWARD-LOOKING STATEMENTS This presentation and subsequent - - PowerPoint PPT Presentation

FORWARD-LOOKING STATEMENTS

This presentation and subsequent discussion contain certain forward- looking statements with respect to the financial condition, results of

• perations and business of Clear Media as well as our current

expectations, consumptions, estimates and projections about our

• industry. All statements other than statements of historical fact,

including the statements under the heading “Outlook”, are forward-looking statements. These forward-looking statements represent Clear Media’s current expectations or beliefs concerning future events and involve known and unknown risks and uncertainties which could cause actual results, performance

• r events to differ materially from those expressed or implied in

such statements. We do not intend to update or otherwise revise the forward-looking statements in this presentation, whether as a result of new information, future events or

• therwise. You should not place any undue reliance on

any forward-looking statements.

INTRODUCTION

Joseph Tcheng Chairman

INTRODUCTION

 Leader in bus shelter advertising industry in China  Operate 47,000 panels  Nationwide network in 24 cities  Market share of more than 70% in key cities  More than 400 sales personnel servicing both

customers and their advertising agencies

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FY16 RESULTS HIGHLIGHTS

 Reporting currency changed to RMB for more precise reporting  Turnover grew +8.2% in challenging operating environment  EBITDA margin expanded marginally to 43.6 % (2015: 43.3%)  EPS grew +6.2%  Final dividend of HK 17 cents (2015: HK 16 cents)

(RMB’M) FY15 FY16 YOY% Turnover 1,486 1,608 +8.2% EBITDA 644 701 +8.9% EBIT 354 376 +6.2% Net profit 228 243 +6.4% Basic EPS (RMB) 0.4223 0.4484 +6.2% Final DPS (HK cents) 16 17 +6.3%

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FINANCIAL REVIEW

Teo Hong Kiong Chief Financial Officer

FY16 CONSOLIDATED INCOME STATEMENT

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(RMB’M) FY15 FY16 YoY% Turnover 1,486 1,608 +8.2% Cost of sales, excluding amortization (554) (586) +5.9% Operating expenditure, excluding depreciation & amortization (289) (321) +10.9% EBITDA 644 701 +8.9% Depreciation & amortization (290) (325) 12.3% EBIT 354 376 +6.2% Net profit 228 243 +6.4% Basic EPS (RMB) 0.4223 0.4484 +6.2 % Final DPS (HK cents) 16 17 +6.3 %

*Reporting currency changed to RMB for more precise reporting

COSTS & EXPENSES

FY15 FY16 YoY% Rental 319 357 +11.8% Maintenance 122 120

• 1.8%

Electricity 59 55

• 5.3%

Sales & Cultural Tax 54 54 +0.2% Direct operating costs 554 586 +5.9% S, G & A & other expenses 289 321 +10.9% Total costs & expenses, excluding depreciation & amortization 843 907 +7.6%

(RMB’M)

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

Increase in rental due to increase in panels & less rental reversal



Decrease in electricity cost due to increased use of LED lighting



Decrease in maintenance cost due to cost control & adjustment of subsidy ratio



Increase in S, G & A expenses due to salary increase, increased office rental & higher bad debt provision

TRADE RECEIVABLES

(RMB’M) Dec 31, 2015 Jun 30, 2016 Dec 31, 2016 Current – 90 days 290 340 291 91 – 180 days 199 189 235 Over 181 - 360 days 94 106 89 Over 360 days 19 24 34 602 659 649 Less: provision for impairment (26) (30) (37) 3rd party receivables 576 629 612 Turnover days (time wt. avg.) 117 days 120 days 119 days Due from GWH/WHA/WSI (time wt. avg.) 81 days 98 days 77 days

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INCREASE IN CASH FLOWS

(RMB’M) FY15 FY16 YoY% Net cash flows from operating activities 449 496 +10.5% Net cash flows used in investing activities (414) (300)

• 27.5%

Net cash flows used in financing activities (303) (266)

• 12.0%

Net decrease in cash & cash equivalents (268) (70)

• 73.9%

Net cash & cash equivalents at the beginning of period 840 578 effect of foreign exchange rate changes, net 5 7 +28.2%

at the end of year 578 514

• 11.0%

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REVIEW OF STRATEGY & EXECUTION

Harrison Zhang Chief Operating Officer

FY16 HIGHLIGHTS

 Moderating economic growth  Operating environment remained challenging & volatile  Late order confirmation  Last minute order cancellation  Advertisers from traditional industries stayed cautious with

advertising spend

 Growth driven by increase in bus shelter panels

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REVENUE BY INDUSTRY

FY15 FY16 IT – (smartphone: 9% / 16%) 14% 26% – (mobile apps: 5% / 10%) E-commerce 16% 23% Entertainment 12% 10% Beverages 11% 7% Food 10% 7% Realty 9% 6% Business/Consumer services 8% 4% Fashion & ornaments 6% 4% Telecommunications 5% 3% Medical institutions/Devices 4% 2%

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KEY STRATEGIES

 Expand strategically and selectively  Focus on customer relations management  Maintain high product quality & develop innovative solutions  Adhere to strict financial discipline and improve efficiencies

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POWER OF OUR NETWORK

(For the year ended 31 December 2016)

Yield (in RMB) Avg Panel No. Sales Key cities +9.2% +9.7% +19.8% Mid-tier cities

• 10.3%

+5.2%

• 5.9%

TOTAL +1.2% +7.1% +8.2%

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OUTLOOK

 Operating environment expected to remain challenging  Mixed performance from customers across different industries  High level of activities from the e-commerce, smartphone & mobile

application

 Expect capital expenditure at similar scale to 2016 level  Optimistic in the long-run given growth in consumer spending &

continuing urbanization

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