MC GROUP Public Company Limited (“MC”) 2Q 2013 - Investor Presentation 15 Aug 2013
Agenda Pages Overview 2 2Q 2013 Key Achievements 8 Financial Results 12 Going Forward 19 CONFIDENTIAL 1
Overview 2
Our Vision and Mission To be ... Our Vision a leading apparel & lifestyle business in Asia with various brands to serve different lifestyles. We are … Our committed to maximize stakeholder value and customer Mission delight via best fit quality products, affordable prices, accessible channels and passionate services. CONFIDENTIAL 3
Our History # 1 Market Share Over 100 Mc Shops and in Thailand Expanded to Int’l Market Appointed sales agents in � Myanmar in Apr 2012 and in Laos in Dec 2012 Launched Launched 2013 “McLady” BISON 2012 2008 2008 1 st Mc Shop 2005 New Brands / Business Opened first Shop � at Tesco Lotus Salaya Branch (Apr 2013) (Feb 2013) PKG 1994 Established (Jun 2013) (Jun 2013) Launched 1975 “Mc ” CONFIDENTIAL 4
Overall Industry Outlook Consistent growing apparel market in Thailand High growing jeans market in Thailand � Sizable Market with sustainable growth Total Jeans Market Size 11 ,416 MB in 2012 5.2% 303,009 MB Apparel Market Size Historical Growth in 2011 in 2011 76% Non Brand 24% Jeans � Apparel market grew in tandem with GDP Branded Jeans 2,750 MB 2,750 MB 8 ,666 MB 8 ,666 MB 4.5-5.5% Forecasted GDP Growth in 2013 by NESDB Growth Rate 15% Historical Growth Source : Thailand Management Association (TMA) CONFIDENTIAL 5
Number 1 Market Share for Jeans in Thailand Mc Jeans Leading jeans market share in Thailand 1 2 38.4% 27.5% 3 11.6% Others Others 4 12% 10.5% • 38-year presence in Thailand • 38.4% of total branded jeans market in Thailand • Overcome other international and local competitors with quality focus and unique design that fits local customers’ shapes and bodies. Source: MC GROUP Sales Intelligence Team – data as of 30 June 2013 6 CONFIDENTIAL
Results Highlights: Net Profit Increase 19% Sales Revenue Gross Profit 1,400 1,000 1,300 + 17% + 20% 1,200 800 1,100 1,315 1,000 600 766 1,129 639 900 800 400 1H 2012 1H 2012 1H 2013 1H 2013 1H 2012 1H 2012 1H 2013 1H 2013 Net Profit EBITDA 400 450 + 17% + 19% 400 350 350 300 428 344 369 300 250 288 250 200 1H 2012 1H 2013 1H 2012 1H 2013 7 CONFIDENTIAL
2Q 2013 Key Achievements 8
2Q 2013 Key Achievements Successfully opened additional 17 locations in 2Q 2013 to have a total of 547 locations nationwide at the end of the quarter. 547 Branches Nationwide + 7 POS in Southeast Asia Cover 73 Provinces in Thailand 3. Southeast 1. Free Standing Shops 2. Modern Trade Asia 140 Shops 7 POS 407 POS •6 POS in •Growing from expansion of modern •Growing from opening shops in Myanmar Myanmar trade trade existing and new modern trade. existing and new modern trade. •1 POS in Laos 108 32 Shops Shops Fairy Upcountry Bangkok Plaza 9 CONFIDENTIAL
2Q 2013 Key Achievements Launched 2 new brands - expanding our product assortments to better serve market demands of different target groups. Brand: Mc Mini Brand: Blue Brothers Launched: April 2013 Launched: June 2013 • Expand MC clientele • Tap into premium base to start from 6 base to start from 6 jeans market to jeans market to years old compete with international premium • Products are sold in Mc brands Jeans shops • Currently sold at a pop-up shop located in Siam Center 10 CONFIDENTIAL
2Q 2013 Key Achievements Expanded to online platform with the launched of www.WoWme.co.th – shopping online website with flash sales concept. The product offerings through the website will not be limited only to brands under MC GROUP but also other fast growing product categories from other brands. 11 CONFIDENTIAL
Financial Results 12
1H 2013 Sales Revenue Increases 17% Sales revenue continues to grow attributable to the company’s effort in distribution channels expansion, even though consumers’ purchasing power has soften in 2Q 2013. Free standing shop sales contribution continues to increase. +17% YoY THB millions THB millions 1,315 1,400 900 829 +10% YoY 1,129 1,200 800 1,000 673 643 700 598 585 800 600 544 600 600 500 400 400 200 300 - 200 1H 2012 1H 2013 100 Free standing shop Modern trade Other - 1Q 2012 2Q 2012 3Q 2012 4Q 2012 1Q 2013 2Q 2013 1H 2012 1H 2013 Free standing shop Modern trade Other 26% 36% 64% 71% CONFIDENTIAL 13
Average Sales Per Store With MC’s commitment to meet market demands of different lifestyles, the company continues to expand its product offerings by introducing new brands - one of the factors helps maintaining strong average sales per store despite slowdown in consumers spending. THB millions 8 6.14 6 5.15 3.92 4 2.94 2.89 2 - 2010 2011 2012 1H 2012 1H 2013 Note: Average sales per store for the period. Figures are calculated based on free standing shops and modern trade sales revenue, gross of GP. Excluded sales from international markets and other source (i.e., exhibition etc.) CONFIDENTIAL 14
Gross Profit Increased While Margins is Maintained Gross profit margin improved significantly in the last couple of years as a result of lean process management, economies of scale and changes in fashion trend and will be maintained at the current levels. 70% 2,000 58% 1,800 57% 59% 57% 58% 57% 55% 60% 56% 1,600 48% 1,400 50% 50% 1,200 41% +20% YoY 40% 1,000 +14% YoY 800 30% 600 870 400 766 20% 639 530 452 394 200 372 338 313 326 10% - FY2010 FY 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012 1Q 2013 2Q 2013 1H 2012 1H 2013 Gross Profit Gross Profit Margin (THB millions) CONFIDENTIAL 15
Maintain High EBITDA and Net Profit Margins Increase in gross profit margins mostly are able to flow through to EBITDA and net profit. 40% 1,200 33% 33% 33% 33% 33% 32% 29% 30% 1,000 30% 27% 800 +17% YoY +11% YoY 20% 600 16% 400 10% 481 428 200 369 208 181 188 180 243 219 209 0% - FY2010 FY2010 FY 2011 FY 2011 1Q 2012 1Q 2012 2Q 2012 2Q 2012 3Q 2012 3Q 2012 4Q 2012 4Q 2012 1Q 2013 1Q 2013 2Q 2013 2Q 2013 1H 2012 1H 2012 1H 2013 1H 2013 EBITDA EBITDA Margin (THB millions) 26% 30% 27% 26% 26% 25% 25% 24% 600 21% +19% YoY 20% 16% +10% YoY 400 8% 10% 200 344 299 288 180 174 163 149 105 139 145 0% - FY2010 FY 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012 1Q 2013 2Q 2013 1H 2012 1H 2013 Net Profit Net Profit Margin (THB millions) CONFIDENTIAL 16
Strong Key Performance Ratios Total assets and total shareholders equity grew significantly driven mainly by the IPO proceed in 2Q 2013. 107% 120% 6,000 95% 89% 100% 5,000 82% 78% 78% 80% 4,000 60% 3,000 31% 30% 40% 2,000 3,699 20% 3,699 1,000 693 841 642 816 536 841 0% - 1Q 2012 1Q 2012 2Q 2012 2Q 2012 3Q 2012 3Q 2012 4Q 2012 4Q 2012 1Q 2013 1Q 2013 2Q 2013 2Q 2013 1H 2012 1H 2012 1H 2013 1H 2013 (1) 60% 8,000 Shareholders Equity ROE 7,000 50% 6,000 37% 36% 36% 35% 35% 40% 32% 5,000 30% 4,000 20% 19% 3,000 20% 2,000 5,022 10% 5,022 1,940 2,013 1,911 1,722 1,722 1,000 1,678 0% - 1Q 2012 2Q 2012 3Q 2012 4Q 2012 1Q 2013 2Q 2013 1H 2012 1H 2013 (2) Total Assets ROA Note: (1) ROE shown are annualized and calculated using the period net income divided by average shareholders’ equity for the period. (2) Similarly, ROA shown are annualized and calculated using the period net income divided by total assets for the period. CONFIDENTIAL 17
Dividend Payment Earnings Per Share Dividend Per Share (1) (THB) (THB) 0.50 0.500 0.40 0.400 0.30 0.300 0.43 0.20 0.200 0.35 0.23 0.225 0.10 0.20 0.100 0.125 - - 1Q 2013 2Q 2013 YTD 1Q 2013 2Q 2013 YTD Payout Ratio Dividend Yield (2) 10.0% 100% 8.0% 75% 6.0% 50% 100% 4.0% 81% 7.0% 61% 5.4% 25% 2.0% 3.9% 0.0% 0% 1Q 2013 2Q 2013 YTD 1Q 2013 2Q 2013 YTD Note: (1) Calculated assuming total shares outstanding of 800 million at par value of THB 0.50 per share(2) Dividend yields shown are annualized and calculated based on closing price on13 Aug 2013 at THB 12.9 CONFIDENTIAL 18
Going Forward 19
In The Second Half of 2013 Penetrate overall jeans market and extend to larger pool of apparel market 1 Product Line Upcoming Extension line / brand Mobile unit - the new way to shop – provide customers convenience 2 Expand and allow MC to tap into new group of consumers Sales Sales Business Channels to 601 + Strategy adding mobile units 3 Capture high growing markets in Southeast Asia Expansion to ASEAN Current Markets New Markets Countries � Myanmar � Indonesia � Laos � Malaysia CONFIDENTIAL 20
Raise Distribution Channels Target For 2013 MC has increased its target to have a total of 601 locations nationwide by year-end from its original target of 584. Moreover, the company target to open another 100+ new locations for the next 3 years. 100+ 100+ 601 100+ 571 547 530 511 Modern Trade Shops 4Q 2012 1Q 2013 2Q 2013 3Q 2013 4Q 2013 2014 2015 2016 2Q 2013 4Q 2013 (# of free standing shops) 129 157 4 6 7 10 - 1 CONFIDENTIAL 21
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