imite d Po rts De sig n L 2006 Annua l Re sults 2006 Ove rvie w T - - PDF document

Po rts De sig n L imite d

2006 Annua l Re sults

Ports Design Limited (HK:0589) 2006 Annual Results 2

2006 Ove rvie w

T urno ve r inc re a se d 23.86% o ve r 2005 to RMB1.055 b illio n in 2006 Re ta il se g me nt c o ntinue d to g ro w in te rms o f its impo rta nc e to the Gro up, inc re a sing c o ntrib utio n to o ve ra ll Co mpa ny turno ve r fro m 75.56% in 2005 to 79.51% in 2006 Gro ss Pro fit inc re a se d 31.97% o ve r 2005 to RMB733.6 millio n in 2006, a nd g ro ss pro fit ma rg in inc re a se d fro m 65.27% in 2005 to 69.54% in 2006 Pro fit fro m o pe ra tio ns inc re a se d 50.57% o ve r 2005 to RMB280.0 millio n, a nd o pe ra ting ma rg in inc re a se d fro m 21.83% in 2005 to 26.54% in 2006, ma inly due to the inc re a se d o ve ra ll c o ntrib utio n fro m the hig h-ma rg in re ta il se g me nt a nd inc re a sing b e ne fits o f e c o no mie s o f sc a le Ne t Pro fit inc re a se d 53.88% o ve r 2005 to RMB254 millio n, a nd ne t pro fit ma rg in inc re a se d fro m 19.38% in 2005 to 24.08% in 2006 T he Co mpa ny c o ntinue s to e njo y a stro ng fina nc ia l po sitio n, with a ppro xima te ly RMB412.7 millio n in c a sh a nd c a sh e q uiva le nts a nd time de po sits (2005: RMB346.7 millio n,) a nd a g e a ring ra tio o f ze ro a s a t 31 De c e mb e r 2006 E a rning s pe r sha re inc re a se d fro m RMB0.30 in 2005 to RMB0.46 in 2006, a n inc re a se o f 53.33%

Ports Design Limited (HK:0589) 2006 Annual Results 3

T urno ve r

168.2 37.1 379.2 157.2 65.3 491.6 157 51.2 643.5 159.8 56.3 838.8

100 200 300 400 500 600 700 800 900 2003 2004 2005 2006

OE M Ot her R et ail

79.51% 75.56% 68.84% 64.87% Re ta il 15.15% 18.43% 22.02% 28.78% OE M 5.34% 6.01% 9.14% 6.35% Othe r

Segment tur nover

(R MB millions)

23.86% 19.27% 22.2% 24.47%

2006 2005 2004 2003 T ur nover gr

• wth

Ports Design Limited (HK:0589) 2006 Annual Results 4

Gro ss pro fit

336.7 435.4 555.9 733.6

100 200 300 400 500 600 700 800 2003 2004 2005 2006

Gr

• ss pr
• fit

80.89% 78.5% 76.9% 76.5% Re ta il

69.5% 65.3% 61.0% 57.6% Combined

18.01% 17.2% 16.3% 14.4% OE M 46.70% 46.71% 49.7% 60.0% Othe r

2006 2005 2004 2003 Gr

• ss pr
• fit mar

gin

(R MB millions) 27.68% 29.31% 31.97%

Ports Design Limited (HK:0589) 2006 Annual Results 5

Ne t pro fit

107.5 133.5 165.1 254.0

0.0 50.0 100.0 150.0 200.0 250.0 300.0 2003 2004 2005 2006

N et pr

• fit

24.08% 19.38% 18.70% 18.40% Ne t pro fit ma rg in RMB0.46 RMB0.30 RMB0.24 RMB0.97 E a rning s Pe r Sha re

2006 2005 2004 2003

(R MB millions) 27.50% 23.61% 53.88%

Ports Design Limited (HK:0589) 2006 Annual Results 6

Re ta il se g me nt

T he Co mpa ny’ s re ta il se g me nt, o pe ra ting PORT S a nd BMW L ife style sto re s in the PRC a nd Ho ng K

• ng , e xpe rie nc e d stro ng

turno ve r g ro wth in 2006 T

• ta l re ta il turno ve r inc re a se d 30.34% o ve r 2005 to RMB838.8

millio n in 2006 Sa me -sto re sa le s in 2006 e xpe rie nc e d re c o rd g ro wth, inc re a sing a ppro xima te ly 31% o ve r 2005 (2005: a ppro x. 25%), a nd inc luding a slo wdo wn in Oc to b e r a nd No ve mb e r a ttrib ute d to wa rme r winte r te mpe ra ture s whic h ne g a tive ly a ffe c te d F a ll/ Winte r c o lle c tio n sa le s ASP inc re a se d b y a ppro xima te ly 7% in 2006 fo r b o th PORT S a nd BMW L ife style , re fle c ting the stre ng th o f b o th b ra nds in the minds o f Chine se c o nsume rs T he hig h-ma rg in re ta il se g me nt c o ntinue s to inc re a se in te rms

• f impo rta nc e to the Gro up, c o ntrib uting 79.51% o f to ta l Gro up

turno ve r a nd 92.49% o f the Gro up’ s g ro ss pro fit T he g ro wing c o ntrib utio n o f the hig he r-ma rg in re ta il b usine ss, ma tc he d with the inc re a sing b e ne fits o f e c o no mie s o f sc a le is a c c e le ra ting the g ro wth o f the Co mpa ny’ s o pe ra ting a nd ne t pro fit ma rg ins, whic h a re 26.54% a nd 24.08%, re spe c tive ly in 2006

Ports Design Limited (HK:0589) 2006 Annual Results 7

OE M & Othe r se g me nts

BMW L I F E ST YL E a nd OE M e xpo rts suffe re d re sidua l ne g a tive e ffe c ts o f 2005 sa fe g ua rd q uo ta s impo se d b y the USA a nd E E C g o ve rnme nts, whic h e ffe c tive ly re duc e d the shipping se a so n fo r the e xpo rt o f BMW L I F E ST YL E pro duc ts to BMW AG a nd OE M e xpo rt o rde rs to the USA to 3 mo nths inste a d o f the usua l 6 mo nths

OE M

• OE

M T urno ve r inc re a se d slig htly b y 1.81% to RMB159.8 millio n

• OE

M Gro ss Pro fit ma rg in inc re a se d fro m 17.22% in 2005 to 18.01% in 2006

• OE

M Gro ss Pro fit inc re a se d b y 6.46% to RMB28.8 millio n

Other (“ODM”)

• ODM se g me nt turno ve r inc re a se d b y 5.34% to RMB56.3

millio n due to re sidua l e ffe c ts o f sa fe g ua rd q uo ta s

• ODM se g me nt g ro ss pro fit ma rg in re ma ine d re la tive ly sta b le

a t 46.71% in 2005 a nd 46.70% in 2006

• ODM se g me nt g ro ss pro fit inc re a se d b y 9.94% to RMB26.3

millio n

Ports Design Limited (HK:0589) 2006 Annual Results 8

I ndustry re c o g nitio n

I nde pe nde nt 3rd pa rty surve ys, unpa id c e le b rity e ndo rse me nt, a nd pub lishe d suppo rt fro m fa shio n inside rs a re the o nly wa ys to re lia b ly g a ug e suc c e ss o f a b ra nd I n the luxury a nd fa shio n industrie s, fina nc ia l stre ng th will fo llo w b ra nd stre ng th “China F a shio n I nde x” – a re po rt c o -pub lishe d b y Vo g ue China a nd the China Na tio na l Re se a rc h Asso c ia tio n in Aug ust 2006, re po rte d Po rts a s the 3rd mo st fa shio na b le b ra nd a c c o rding to Chine se wo me n – a he a d o f Dio r, Guc c i, Pra da , Arma ni a nd Do lc e & Ga b b a na . T he sa me re po rt na me d BMW a s China ’ s mo st de sira b le c a r b ra nd F

• rb e s Asia vo te d Po rts De sig n L

imite d a s o ne o f the 200 b e st ma na g e d a nd fa ste st-g ro wing midsize c o mpa nie s in it’ s “Be st unde r a Billio n” list, pub lishe d in Oc to b e r 2006

Heidi Klum (in Ports 1961)

• n The Tonight Show with

Jay Leno China Fashion Index Ports 1961 designer, Tia CIbani featured at Oscar.com

Ports Design Limited (HK:0589) 2006 Annual Results 9

I ndustry re c o g nitio n (c o nt’ d)

T he list o f Ho llywo o d c e le b ritie s se e n we a ring Po rts 1961 c o ntinue d to g ro w in 2006, inc luding a c tre sse s suc h a s He le n Mirre n (2006 Osc a r “b e st a c tre ss” winne r), Sa ndra Bullo c k, Po rtia de Ro ssi a nd c a st me mb e rs fro m hit T V sho ws “E nto ura g e ” a nd “CSI ,” a mo ng o the rs

Tia Cibani with Sienna Miller (in Ports 1961) Marg Helgenberger, “CSI” (in Ports 1961) Perrie Reeves (in Ports 1961), and cast of “Entourage” Tia Cibani with Wynona Rider Sandra Bullock (in Ports 1961) with Forest Whitaker Ports 1961 photo shoot with renowned photographer Steven Meisel and stylist Grace Coddington Oscar-winning best actress, Helen Mirren (in Ports 1961), Vanity Fair March 2007

Co nta c t

F

• r furthe r info rma tio n, ple a se c o nta c t;

Winnie Chin

I nve sto r Re la tio ns Po rts De sig n L imite d +852 2504-1961 winnie .c hin@ po rts1961.c o m

Adr ian Pic k

Co rpo ra te De ve lo pme nt & Co mmunic a tio n Po rts De sig n L imite d +86 (592) 606-9998 a dria n.pic k@ po rts1961.c o m