Central Pattana Plc. Property Development and Investment Corporate Presentation: 2Q11 Performance Review CentralPlaza Lardprao after renovation
Disclaimer The information contained in this presentation is for information purposes only and does not constitute an offer or invitation to sell or the solicitation of an offer or invitation to purchase or subscribe for share in Central Pattana Public Company Limited ( CPN and shares in CPN, shares ) in any jurisdiction nor should it or any part of it form the basis of, or be relied upon in any connection with, any contract or commitment whatsoever. This presentation may include information which is forward-looking in nature. Forward-looking information involve known and unknown risks, uncertainties and other factors which may impact on the actual outcomes, including economic conditions in the markets in which CPN operates and general achievement of CPN business forecasts, which h will cause the actual results, performance or achievements of CPN to differ, perhaps materially, from the results, performance or achievements expressed or implied in this presentation. This presentation has been prepared by the CPN. The information in this presentation has not been independently verified. No representation, warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information and opinions in this presentation. None of the CPN or any of its agents or advisers, or any of their respective affiliates, advisers or representatives, shall have any liability (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with this presentation. This presentation is made, furnished and distributed for information purposes p only. No part of this presentation shall be relied upon directly or indirectly for any investment decision-making or for any other purposes. This presentation and all other information, materials or documents provided in connection therewith, shall not, either in whole or in part, be reproduced, redistributed or made available to any other person, save in strict compliance with all applicable laws. Note: All currency figures within this presentation are presented in Thai Baht unless otherwise stated. 2
Agenda Company Overview Operations Future Developments Financial Highlights Appendix
Company Overview
Business Overview Highlights Recent Achievements CPN is the leading retail property developer and investor Excellence CG Scoring honored the company s in Thailand with a 21% market share in Bangkok s mall corporate governance performance. leaseable area. ICSC Best of the Best Award - Design and CPN manages 16 shopping centers, 6 office towers, Development CentralWorld honored and 2 hotels, and 2 residential properties p in Thailand. recognized the most outstanding shopping center design and development of CentralWorld. CPN continuously achieves strong growth of shopping complex through green-field developments, acquisition & CNBC Best Mixed-Use Development Award redevelopments and asset enhancement projects. honored the unique and exceptional design and environment concerns of CentralWorld. CPN is a fully integrated retail developer with unparallel synergies with its major shareholders, Central Group and A+ Credit Rating was affirmed with stable outlook Thailand Equity Fund, and unmatched financing capability by TRIS Rating in August 2010. through its property fund. CPN is the largest retail property developer on Stock Exchange of Thailand (SET) with a market capitalization of approx. USD 2.07 bn (1). CPN is the property p manager and largest shareholder (28%) in Thailand s largest REIT - CPN Retail Growth Leasehold Property Fund (CPNRF) with a market capitalization of approx. USD 661 mil (1). Source: SetSmart as of 30 June 2011. 5
Strong Development & Acquisition Pipelines Green- -field Develo opment 1980 Established under CentralPlaza Co., Ltd. 2002 1982 Opened CentralPlaza Ladproa The first integrated shopping complex in Thailand 1995 Opened CentralPlaza Pinklao AND Central Center Pattaya 1993 Opened CentralPlaza Ramindra Opened CentralPlaza Rama 2 1997 Opened CentralPlaza Ratchada Rama 3 2008 Opened CentralPlaza Chaengwattana 2009 Opened CentralFestival Pattaya Beach, CentralPlaza Chonburi AND CentralPlaza Khon Kaen 2010 Opened Hilton Pattaya Beach Hotel 2011 (NEW) Opened CentralPlaza Chiangrai, Open CentralPlaza Phitsanulok, CentralPlaza Rama 9 2012 (NEW) Open CentralPlaza Suratthani 2013 (NEW) Open CentralFestival Chiangmai Acquisition & Redevelo opment CPN current portfolio: 16 Shopping Centers 6 Office Towers 1996 Acquired full equity stake in CentralPlaza Chiangmai Airport 2000 2002 Completed CentralPlaza Chiangmai Airport Phase 2A Acquired CentralWorld 2006 (Formerly World Completed CentralWorld 2001 Trade Center) Acquired full equity stake in 2004 Completed CentralPlaza Bangna The Offices at CentralWorld 2003 Acquired CentralPlaza Rattanathibet (Formerly Siam Jusco Rattanathibet) AND completed CentralPlaza Chiangmai Airport Phase 2B 2012 (Enhancement) Complete CentralPlaza Udonthani Phase 2 2009 Acquired CentralPlaza Udon Thani (formerly Charoensri Complex) 4 Projects Under Development 6
Leading Market Share of Mall Retail Space in BMA CPN is the leading retail property developer and investor in Thailand with approximately 21% market share in Bangkok Metropolitan Area s mall leaseable space. CPN 21% Other 46% The Mall Group 9% Fashion Island 3% Siam Future 6% Future Park Rangsit 4% Siam Paragon 4% Seacon Square 7% Source : Company estimate as of 30 June 2011. 7
Strategic Shareholders CPN is one of the flagship businesses of the Central Group (Chirathivat Family). As a strong and supportive shareholder, the Chirathivat family brings to CPN a wealth of retail related expertise through the family s long record and successful leadership in Thailand s dynamic and competitive landscape of shopping mall developments and department store / specialty stores operations. Local funds 27% Chirathivat Family 32% Central Group totaling 59% Others (Free float) 41% Foreign funds 61% Individuals 12% Central Group 27% Source : Company estimate as of 16 August 2011. 8
Strategic Shareholder: Central Group CPN s strong synergy with the Central Group helps CPN to attract dynamic tenants, increase people traffic and command higher rents. The Central Group and Chirathivat Family 59% 100% 67% 100% Central Pattana Central Retail Centara Hotel Central Marketing (CPN) Corporation (CRC) (CENTEL) Group (CMG) Owner and developer of Owner of retail chains Owner of Centara hotel, Owner of international retail Shopping Centers and Mix- Used Complex including Central Department Stores, Robinson Department resorts, and convention centers, and also franchisees of fast-food franchisees for; - Cosmetics : Clarins, Elizabeth Aden, Payot... Stores, ZEN Department retail chains including - Apparel : G2000, U2, Store, Power Buy, Super KFC, Mister Donut, TOPSHOP, Dorothy Perkins, Sports, B2S, Home-works, Tops Supermarket, Office Depot, etc. Auntie's Anne, Pepper Lunch, Beard papa, Cold Stone, Chabuton, Ootoya Enorgie, Hush Puppies, Wrangler, Lee, FCUK, Energy, Miss Sixty... - Others : Samsonite, Pentax, Guess watch, Casio... 9
Fully Integrated Business Platform CPN is the only retail developer in Southeast Asia with a fully integrated business platform that will allow it to expand on a sustainable basis and achieve operational enhancements and success with its synergies with the Central Group of companies. CPN will use this integrated t business platform to expand further throughout h t Thailand, maintaining i i market share in Bangkok while increasing market share in the Provincial area. CPN will also utilize this optimal business platform in its expansion into neighboring countries. Central Group Largest and most popular retail chains in Thailand Guarantee space take-up with successful brands and store concepts Increase people traffic Most successful and most experienced retail company in Thailand Attract tenants to locate in CPN shopping centers Allow CPN to achieve higher rental rates than others CPN Leading retail developer, property manager and investor in Thailand with market share of 22% of Bangkok s mall saleable area Integrated development, leasing and property management teams have ensured continuous success for over 30 years Strategic location Optimal tenant mix World class standard Branded malls to ensure innovative designs and functionality to suit customer needs CPNRF Property Fund Largest property fund in Thailand Provide optimal funding source: Unlock CPN s asset value Free up capital for business expansion Lower leverage and avoid dilution Create fee base income Improve CPN s financial position: Tax benefit Capital redeployment to projects with higher return 10
Key Success Factors Unrivalled Leading Player in the Retail Property Development Industry Recurring income from monthly rent with proven sustainable rental growth High Revenue Generating Capability at Sustainable Growth Rate Central s Group Synergy Business alliances and joint developers, building confidence among prospects and attracting shoppers Experienced & Hands-on Management 30-yeared experience in retail property development & management Site selection, merchandizing mix, and retail business know-how s Enhanced funding capability through REIT vehicle. Business growing at a low gearing Prudent Financial Management and Financial Flexibility Step-up rental structure. Well diversified portfolio in 16 high traffic growth areas Dynamically Innovative & Diversification Focus on Retail Property Development in Prime Locations with Solid Operating Performance High quality shopping centers: high occupancy & traffic flow and sustainable rental growth 11
Operational Performance
Property Locations Existing Projects: Shopping Centers: 16 World Format 1 (BMA) Plaza Format 13 (8 - BMA) (5 - Province) Center Format 1 (Province) Festival Format 1 (Province) Offices: 4 (BMA) Hotel: 2 (Province) Thailand Existing Projects Future Projects Pipeline Projects: Shopping Centers: BMA - Rama IX - Suan Lumpini (Pre-Cadet School) Provinces - Phitsanulok - Suratthani - Chiangmai Bangkok Metropolitan Area (BMA) 13
Leasable Area and Occupancy: Bangkok Retail CPN manages sixteen (16) premium shopping centers Nine (9) in Bangkok Metropolitan Area (BMA) and its vicinities and seven (7) in provincial areas. In 2Q11, occupancy of the BMA shopping centers stood at 93%. Retail Properties in BMA CPN Retail Develop- Land Properties ment Ownership Leaseable No.of area (1) Tenants Occupancy Rate (2) (sqm) 2Q11 (1) 2Q11 1Q11 2Q10 1. Lardprao Greenfield Leasehold n/a n/a n/a n/a 87% 2. Ramindra Greenfield Leasehold 17,160 79 100% 100% 100% Closure for major renovation from Feb - Aug 2011. 3. Pinklao (3) Greenfield Leasehold 35,705 144 99% 99% 100% 4. Rama 3 (3) Greenfield Freehold 18,394 69 99% 100% 100% 5. Bangna Acquisition Freehold 53,216 284 99% 99% 99% 6. Rama 2 (3) Greenfield Leasehold 5,937 34 100% 100% 100% 7. Rattanathibet Acquisition Freehold 77,309 206 97% 97% 98% 8. CentralWorld Acquisition Leasehold 187,028 478 87% 86% n/a 9.Chaengwattana Greenfield Freehold 65,550 391 95% 95% 91% Under major renovation. Full opening is expected in Dec 11. CPN Portfolio in BMA 460,317 (4) 1,685 93% 93% 95% Note 1: Excludes rental agreements < 1 year, such as kiosk, carts, ATMs and coin machines. Note 2: Percentage based on leaseable area. Note 3: Excludes areas transferred to CPNRF. Note 4: Includes Zen Department Store and under-renovating areas at CentralWorld. 14
Leasable Area and Occupancy: Provincial Retail Seven (7) shopping centers are strategically located in high traffic growth areas in provinces. Occupancy rate in 2Q11 averaged 95%. Retail Properties in Provincial Areas CPN Retail Develop- Land Properties ment Ownership Leaseable area (1) No.of Tenants Occupancy Rate (2) (sqm) 2Q11 (1) 2Q11 1Q11 2Q10 1. Pattaya Center Greenfield Leasehold 15,226 127 92% 97% 97% 2. Chiangmai Acquisition Freehold 75,918 520 99% 100% 99% 3. Pattaya Festival Greenfield Freehold 57,150 304 95% 93% 90% 4. Udonthani Acquisition Freehold 49,076 181 97% 97% 98% 5. Chonburi Greenfield Freehold 39,240 291 95% 96% 90% 6. Khonkaen Greenfield Freehold 50,123 353 89% 86% 91% 7. Chiangrai Greenfield Freehold 17,932 116 99% 90% n.a. Opened in Mar 11. CPN Portfolio in Provinces 304,665 1,892 95% 95% 94% Total CPN Portfolio for Retail Properties 764,982 (4) 3,577 94% 94% 95% Note 1: Excludes rental agreements < 1 year, such as kiosk, carts, ATMs and coin machines. Note 2: Percentage based on leaseable area. Note 3: Approximate figures. Note 4: Includes Zen Department Store and under-renovating areas at CentralWorld. 15
Leasable Area and Occupancy: Office Office property is considered as non-core business, complementing shopping center business and adding value to the overall project. As of 2Q11, CPN owned four office towers located in BMA with an average occupancy rate of 83%. Office Develop- ment Land Ownership Leaseable area (1) No.of Tenants Occupancy Rate (2) (sqm) 2Q11 (1) 2Q11 1Q11 2Q10 1. Lardprao Greenfield Leasehold 16,275 41 60% 55% 38% Completed its major renovation in 1Q11. 2. Bangna Acquisition Freehold 10,007 29 94% 98% 97% 3. CentralWorld Acquisition Leasehold 82,796 92 92% 91% 95% 4. Chaengwattana Greenfield Freehold 19,708 39 58% 57% 53% Opened in Mar 09. Total 128,786 201 83% 82% 81% Note 1: Excludes storage. Note 2: Percentage based on leaseable area. 16
Occupancy: Residential and Hotel Residential property and hotel are non-core businesses. These businesses complement that of the shopping center and add value to the project. Residential Residential Leaseable area (1) Occupancy Rate (2) (sqm) 2Q11 1Q11 2Q10 1. Bangna 1,907 42% 42% 58% Strata title. Asset for sales. 2. Langsuan 4,466 69% 70% 76% 50-unit furnished apartment. Total 6,373 61% 62% 71% Hotel No. of Occupancy Rate % Hotel Available Room 2Q11 1Q11 2Q10 Centara Udonthani n.a. n.a. 84% 64% Managed by Central Plaza Hotel Plc. Hilton Pattaya 302 62% 62% n/a Managed by Hilton Hotel Corporation Total 302 62% 72% 64% Note 1: Includes retail space. Excludes storage. Note 2: Percentage based on leaseable area. 17
Operation Performance: CPNRF In 2Q11, CPN Retail Growth Leasehold Property Fund ( CPNRF ) owns three shopping centers and two office towers. CPNRF is managed by SCB Asset Management, Fund Manager. Its properties are managed by CPN, Property Manager. CPNRF Retail Properties Development Land Ownership Leaseable area (1) (sqm) No.of Tenants 2Q11 (1) Occupancy Rate (2) 2Q11 1Q11 2Q10 1. Rama 2 Greenfield Leasehold 93,489 316 99% 99% 99% 2. Rama 3 Greenfield Freehold 40,071 229 96% 95% 94% 3. Pinklao Greenfield Leasehold 24,007 115 95% 95% 96% CPNRF Retail Properties 157,567 660 98% 98% 97% CPNRF Office Develop- Land Properties ment Ownership Leaseable No.of Occupancy Rate (2) area (1) (sqm) Tenants (1) 1Q11 2Q11 1Q11 2Q10 Pinklao Tower A & B Greenfield Leasehold 33,760 102 96% 94% 96% CPNRF Portfolio 191,327 762 97% 97% 97% Note 1: Includes rental agreements < 1 year such as kiosk, carts, ATMs and coin machines and CPN acts as the property manager. Note 2: Percentage based on leaseable area. 18
Effective Rental Rate (1) Declined effective rental rate from lower rental rates of newly opened malls in provinces (Bt./sqm/mth) Same Store Rental +6.7% YoY Rental Rate of matured malls (Bt/sm/mth) 1,300 1,212 1,200 1,114 1,100 1,000 1,400 900 1,200 1,000 1,040 1,164 1,220 1,274 1,254 1,225 1092 1,092 1,165 2Q10 2Q11 Excludes CentralWorld, CentralPlaza Lardprao, and new projects (2) (Bt/sm/mth) Rental Rate of new malls 1,200 800 1,100 1,065 1,108 600 1,000 2005 2006 2007 2008 2009 2010 2Q10 2Q11 All projects Excludes CentralWorld,CentralPlaza Lardprao, and CentralPlaza Chiangrai 900 2Q10 2Q11 The five new malls (opened during 2008 2009) (2) Note 1 : The figures are effective rental rates for retail tenants (occupied space < 1,000 sqm) and net of special rental discounts. Note 2 : Newly opened projects - CentralPlaza Chaengwattana, CentralFestival Pattaya Beach, CentralPlaza Udonthani, CentralPlaza Chonburi, and CentralPlaza Khonkaen. Source: Company estimate as of 30 June 2011. 19
Rental Contract Type Monthly basis collection (up to 3 years) Increase rental rate approx 5% p.a. Approx. 1/3 of rental contract expired every year Fixed rent 51% % of Sales 24% Monthly basis collection (up to 3 years) Tenants: food centers, cineplex and international brands such as McDonalds, KFC Range of percentage: 10% 30% of sales With minimum guarantees Long term lease 25% Note: On top of space rental fee, service & utility fees are collected on a monthly basis Up front collection (up to 20 years) Up front payment realize throughout lease contract period on straight line basis Note1: Percentage based on occupied area. Excludes leaseable area of CentralPlaza Lardprao. Source: Company estimate as of 3o June 2011. 20
Future Developments
Secured Future Locations CentralFestival Chiangmai NLA: 46,500 sqm Opening in 2013 CentralPlaza Phitsanulok NLA: 23,200 sqm Opening in Oct 2011 CentralPlaza Rama IX NLA: 89,600 sqm Opening in Dec 2011 CentralPlaza Suratthani NLA: 31,600 sqm Opening in June 2012 + 3 secured land plots As of 30 June 2011. 22
CentralPlaza Phitsanulok Project Highlights Investment Cost (1) Program 1,400 MB Shopping Center (N.L.A.) 23,200 sqm (2) Parking (G.A) 1,000 cars Joint- Developer Robinson Department Store (3) Location Construction Progress 104 rais, Phitsanulok Province Central of Thailand 48% of construction Opening (tentative) October 2011 Note1: Includes land and construction cost of shopping center and parking building. Excludes those of Robinson Department Store. Note2: Excludes CRC s area (Robinson Department Store). Note3: Area will be developed and owned by the joint developer. However the store will be magnet to draw traffic into CPN s plaza area. 23
CentralPlaza Rama IX Project Highlights Investment Cost (1) Program 5,100 MB Shopping Center (N.L.A.) 89,600 sqm (2) Office Building Parking (G.A) 16,400 sqm 2,500 cars Location Construction Progress 5 km from Bangkok CBD Area 54% of construction Opening (tentative) t ti December 2011 Note1: Includes land and construction cost of shopping center and parking building. Note2: Includes Robinson Department Store - an anchor tenant. 24
CentralPlaza Suratthani Project Highlights Investment Cost (1) 2,000 MB Program Shopping Center (N.L.A.) 31,600 sqm (2) Parking (G.A) 1,400 cars Location Opening (tentative) June 2012 52 rais, Suratthani Province South of Thailand Note1: Includes land and construction cost of shopping center and parking building. Excludes those of department store. Note2: Excludes department store area under CRC. Note3: Area will be developed and owned by the joint developer. However the store will be magnet to draw traffic into CPN s plaza area. 25
CentralFestival Chiangmai Project Highlights Investment Cost (1) Program 3,300 MB Shopping Center (N.L.A.) 46,500 sqm (2) Parking (G.A) 1,600 cars Joint- Developer Central Department Store (3) Location Opening (tentative) 2013 70 rais, Chiangmai Province North of Thailand Note1: Includes land and construction cost of shopping center and parking building. Excludes those of Central Department Store. Note2: Excludes CRC s area (Central Department Store). Note3: Area will be developed and owned by the joint developer. However the store will be magnet to draw traffic into CPN s plaza area. 26
Asset Enhancement Projects
CentralPlaza Lardprao Investment Cost (1) Program Shopping Center Office Tower 2,100 MB Total face life with new design & concept New tenants, including Uniqlo, XXI Forever, TOPSHOP, i-studio, etc Additional parking (over 300 parking spaces) Face lift with new interior design Location Bangkok k Construction Period Completion 1Q11 3Q11 Completed Impact Increased merchandize with more leading brands Increased traffic flow and rental income Post-renovation Before renovation After renovation As of 30 June 2011. Note 1: Includes those of shopping center and office. 28
CentralPlaza Udonthani and Centara Udonthani Investment Cost (1) Program Shopping Center 2,400 MB New retail space (NLA) of 17,700 sqm New anchors, including TOPS, PowerBuy, and SuperSport New parking building (5 floors with over 700 parking spaces) Hotel Face lift with new interior design Location Northeast t of Thailand Construction Period 2Q11 1Q12 Impact Increased leasable area with more leading brands Increased traffic flow and rental income New space After completion Post-renovation As of 30 June 2011. Note 1: Includes those of shopping center and hotel. 29
CentralPlaza Bangna Investment Cost (1) Program Shopping Center Location Construction Period 1,000 MB New retail space (NLA) of 10,500 sqm New parking building (3 floors with over 385 parking spaces) Improved façade and skylight Re-merchandizing mix Bangkok 2Q11 4Q12 Impact Increased leasable area with a wider range of merchandizing and more leading brands. Increased traffic flow and rental income Post-renovation After completion As of 30 June 2011. 30
Future Leaseable Area & Occupancy Rate (sqm) Retail NLA & Occupancy 1,800,000 000 1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 100% 80% 60% 40% Under study projects Under developing projects Exisitng projects % Occupancy (RHS) 2006 2007 2008 2009 2010 011F 2 012F 2 013F 2 014F 2 015F 2 Assets under management 2006 2007 2008 2009 2010 2011F 2012F 2013F 2014F 2015F No.of project 10 10 11 15 15 18 21 24 27 29 Retail space (NLA in sqm) 684,587 697,038 761,111 967,430 964,612 1,100,412 1,222,612 1,291,092 1,425,092 1,485,092 Office space (NLA in sqm) 145,700 144,791 144,791 164,253 163,991 162,823 178,620 178,620 178,620 178,620 Hotel (rooms) 255 557 557 557 557 557 557 Residential (units) 62 62 62 62 62 62 62 62 62 62 Source: Company estimate as at 30 June 2011. Includes leaseable area of CentralPlaza Rama 2, CentralPlaza Rama 3, and CentralPlaza Pinklao which were partially transferred to CPNRF, but still under CPN s management. 31
Capital Expenditure Major capital expenditure will be used to develop new projects. Financing plan for future expansion includes: cash flow from operation, bond issuance and/or project finance, and property fund vehicle. (Unit: MB) Under construction Projects 2010 2011 2012 2013 2014 2015 CentralPlaza Chaengwattana 110 160 CentralFestival Pattaya Beach 100 100 Hilton Pattaya Hotel 1,250 400 CentralPlaza Chonburi 180 110 CentralPlaza Khonkaen 460 450 CentralPlaza Chiangrai 710 710 280 CentralPlaza Pitsanulok 160 770 340 CentralPlaza Rama 9 780 1,400 1,260 CentralPlaza Suratthani 450 580 470 300 CentralFestival Chiangmai 0 500 1,000 900 300 Enhancement projects CentralWorld 820 1,980 CentralPlaza Lardprao 510 1030 1,030 500 CentralPlaza Pinklao 200 CentralPlaza Udonthani Phase 2 50 540 1,000 620 CentralPlaza Bangna Phase 2 0 500 500 Existing projects 500 500 500 1,000 1,000 1,000 Potential projects New Projects (1) 300 2,100 4,600 7,700 9,200 9,400 Total CAPEX 6,580 11,830 10,450 10,520 10,500 10,400 Source: Company estimate as of 30 June 2011. Note 1: Tentative development projects. 32
Financial Performance
Financial Summary (Bt.mil) 14,000 11,755 12,000 11,388 10,000 9,271 8,282 6-mth closure 8000 8,000 of CentralWorld Closure of CentralPlaza Lardprao 6,000 4,000 2,000 0 2,991 3,112 3,119 2,939 2,404 2,438 2,486 768 368 505 1,569 2,158 2,292 1,549 162 612 365 2007 2008 2009 2010 2Q10 1Q11 2Q11 /1 Total revenues Operating profit Net profit % YoY Growth 2007 2008 2009 2010 2Q11 QoQ 2Q11 YoY Total revenues /1 (12%) 12% 27% (3%) (6%) 18% Operating profit 8% 24% 4% (22%) (34%) 37% Net profit 7% 38% 6% (32%) (40%) 126% Same store revenue growth 14% 11% 5% 0% (2%) 8% Excludes non-recurring items Note1: Total Revenue includes rental & service, hotel operation, food & beverage, and other incomes. Excludes interest income and share of profit from investment.. 34
Revenues Breakdown (Bt.mil) 7,000 +18% YoY 6,057 6,000 5,614-6% QoQ 5,000 4,000 3,000 2,000 1,000 2,486 3,119 2,938 1H10 2H11 2Q10 1Q11 2Q11 /1 Other income Hotel F&B Office Retail 2Q11 Revenue breakdown Retail & office +15% YoY, despite the closure of CentralPlaza Lardprao. This was mainly from: The increases in rental rate at most of properties The opening of CentralPlaza Chiangrai in March 2011 The closure of CentralWorld in 2Q10, due to the difficulty of access during political demonstration Hotel revenues +212% YoY, due to the opening of Hilton Pattaya Hotel in November 2010. Retail 79% Office 6% F&B 5% Hotel 4% Other income /1 6% F&B Sales +15% YoY from Higher sales of most food centers The opening of new food center at the newly opened CentralPlaza Chiangrai Excludes non-recurring income. Note1: Includes revenues from residential projects and water & amusement park, and property management fees from CPNRF. 35
Costs Breakdown (Bt.mil) 5,000 4,000 3,436 3,729 +12% YoY Cost of retail & office +10% YoY from: The opening of CentralPlaza Chiangrai +3% QoQ Utilities of CentralWorld which was closed in 2Q10 3,000 2,000 1,000 1,689 1,837 1,892 1H10 2H11 2Q10 1Q11 2Q11 Other income Hotel F&B Office Retail 2Q11 Cost breakdown Office 7% Cost of hotel business +222% YoY, due to the opening of Hilton Pattaya Hotel. The increase in costs was in line with the growth of revenues F&B Costs +16% YoY from Higher F&B sales The opening of new food center at the newly opened CentralPlaza Chiangrai Retail 83% F&B 7% Hotel 3% Other income 0% Note1: Excludes non-recurring items. 36
SG&A Expenses Breakdown (Bt.mil) 1,200 1,074 +26% YoY 1,000 902 +6% QoQ 800 600 400 200 0 439 521 553 1H10 2H11 2Q10 1Q11 2Q11 Personnel expenses +15% YoY from: The openings of Hilton Pattaya Hotel and CentralPlaza Chiangraii Increased number of employee to support business expansion Advertising & promotion 2% YoY, due to the effective cost management to top line driven basis Others Depreciation Advertising & promotion Personnel Depreciations +311% YoY from 2Q11 SG&A breakdown The openings of Hilton Pattaya Hotel and CentralPlaza Chiangrai Personnel 45% Advertising & promotion 17% Depreciation 15% Others 23% Note1: Excludes non-recurring items. 37
Debt Analysis Outstanding Borrowings Bt 21,223 mil Fixed vs. Floating Interest Rate Mix Long term loan 32% Short term bond 24% Fixed 91% Long term bond 34% Short term loan 10% Floating 9% (Bt.mil) Financing Cost 1,400 1,200 1,000 800 600 56% 5.6% 5.5% 5.2% 621 581 543 4.7% 745 4.4% 4.3% 4.3% 688 7% 6% 5% 4% 3% 400 200 178 205 2% 1% 0 2006 2007 2008 2009 2010 1Q11 2Q11 /1 Interest expenses Weighted average cost of debt (RHS) 0% Note 1 : Weighted average interest rate was derived from interest expenses including interest capitalization for projects under development. 38
Capital Structure CPN s net D/E stood at one time, against its debt covenant of 1.75 times. (Bt.mil) 24,000 20,000 16,000 12,000 8,000 4,000 0 13,639 12,045 0.59 3,983 3,677 21,223 19,849 19,008 19,085 18,918 19,527 19,346 16,445 16,669 15,173 1.04 0.97 0.92 0.84 0.74 2,541 1,632 873 1,032 2007 2008 2009 2010 1Q11 2Q11 (Times) 1.40 1.20 1.00 0.80 0.60 0.40 0.20 Cash & current investment Interest bearing debts Equity Net D/E 39
Share Price Performance and Dividend (Bt/share) ('000 shares) 35.0 18,000 16,000 30.0 14,000 12,000 25.0 10,000 20.0 8,000 6,000 15.0 4,000 2,000 10.0 0 Jan 10 May 10 Oct 10 Feb 11 Jun 11 Volume (RHS) Close Share overview Dividend policy is 40% of normal net profit. Par Value (Bt) 1.00 2010 2009 2008 2007 2006 Stock Price (Bt) Consensus FY11 core EPS (Bt/share) P/E /1 (Times) P/BV /1 (Times) Market Capitalization (Bt mil) Share Capital (mil.shares) 29.25 1.10 26.6 3.3 63,730 2,179 Par Value (Bt) Dividend (Bt/share) Dividend Paid (Bt mil) Dividend Payout Ratio 1.00 0.25 545 48% 1.00 0.58 1,264 25% /1 1.00 0.33 719 33% 1.00 0.33 719 40% 1.00 0.31 675 40% Remarks: Dividend policy is paid annually not less than 40% of net profit (unless there is a compelling reason against this). Note 1: Dividend payout ratio of 25% in 2009 was derived from 40% of normal net profit and 14% of gain from transferring assets into CPNRF. Source: Factset as of 30 June 2011 Note 1: Based on analyst s consensus FY11 core EPS 40
Appendix
Details of Borrowings Borrowing Type Tenor Coupon / Repayment Maturity Outstanding (Bt mil) (years) Interest Rate (pa.) Type Date as at June 30, 2011 Short term Promissory Note up to 3 2.60% Bullet 0 Long term Term Loan 3.5 3.14% Bullet Jun 2014 1,500 Term Loan 3.8 3.19% Bullet Sep 2014 900 Term Loan 3.9 3.84% Bullet Jan 2015 500 Unsecured Bond 5.0 4.25% Bullet May 2012 3,000 Unsecured Bond 3.0 4.80% Bullet Aug 2011 1,500 Unsecured Bond 4.0 4.50% Bullet Apr 2013 2,000 Unsecured Bond 5.0 4.75% Bullet Apr 2014 1,000 Unsecured Bond 4.0 4.50% Bullet May 2013 1,200 Unsecured Bond 3.0 4.00% Bullet May 2012 1,000 Unsecured Bond 3 month fixed deposit 2.0 rate + 1.15% Bullet May 2012 500 Unsecured Bond 5.0 3.95% Bullet May 2015 500 Unsecured Bond 5.0 3.96% Bullet Feb 2016 500 Unsecured Bond 5.0 3.95% Bullet Apr 2016 1,000 Thai Business Fund 5 (Property Fund) 15.0 MLR 1.25% Amortising Feb 2018 530 Thai Business Fund 5 (Property Fund) 15.0 6.00% Amortising Feb 2018 125 Project Finance (grace period of 2 years) 7.0 MLR 2.00% Amortising Sep 2015 1,425 Project Finance (grace period of 2 years) 7.0 MLR 2.00% Amortising Jan 2016 868 Project Finance (grace period of 2 years) 7.0 4.25% Amortising Jan 2016 1,000 Project Finance (grace period of 2 years) 70 7.0 MLR 2.00% 200% Amortising i Mar 2016 1275 1,275 Project Finance (grace period of 2 years) 7.0 MLR 1.75% Amortising Nov 2016 900 Total Borrowings 21,223 Less Cash and Current Investments 1,032 Net Borrowings 20,191 Source: Company data as of 31 March 2011. 42
Balance Sheet Dec 2010 Financial position (MB) Jun 2011 % Change (Restated) Current assets Cash and current investments 1,632 1,032 (37%) Other current assets 2,133 2,216 4% Total current assets 3,765 3,248 (14%) Non current assets Investment properties 29,955 32,822 10% Leasehold rights 13,549 13,319 (2%) Property & equipment (PP&E) 2,354 2,238 (5%) Other non current assets 4,213 4,599 9% Total Non current assets 50,071 52,977 6% Total assets 53,836 56,225 4% Current liabilities 10,153153 13,213 30% Non current liabilites 24,765 23,666 (4%) Total liabilities 34,918 36,879 6% Total equities 18,918 19,346 2% 43
Income Statement Consolidated earnings (MB) 2Q10 1Q11 2Q11 % YoY % QoQ (Restated) Change Change Revenues from rental and service 2,165 2,623 2,497 15% (5%) Retail 2,024 2,431 2,308 14% (5%) Office 133 186 182 36% (2%) Other supportive businesses 8 5 7 (9%) 30% Hotel operations 34 131 107 212% (18%) Food & beverage sales 142 142 163 15% 15% Other income 145 223 171 18% (23%) Total revenues 2,486 3,119 2,939 18% (6%) Costs of rental and service 1,557 1,661 1,709 10% 3% Retail 1,424 1,532 1,572 10% 3% Office 126 124 130 3% 5% Othersupportive businesses 7 5 7 4% 48% Hotel operations 14 52 45 222% (13%) Food & beverage sales 119 123 138 16% 12% Total costs 1,690 1,837 1,893 12% 3% Operating profit (407) 768 505 224% (34%) Net profit (613) 612 365 160% (40%) Net profit excluding non recurring items 162 612 365 126% (40%) EPS (Bt) excluding non recurring items 0.07 0.28 0.17 126% (40%) 44
The fire incidents and the renovation of CentralWorld The fire incidents at CentralWorld Project on May 19, 2010 caused damages (1) to CentralWorld Project as follows: Most of Zen Department Store (a long term lessee) Parts of CentralWorld Shopping Complex CentralWorld Project is protected by Industrial All Risks, Business Interruption, and Terrorism insurances. Re construction and re opening schedule: CentralWorld Shopping Complex Now open Isetan Department Store Now open Zen Department Store Owned by CPN not damaged Developed & owned by Central Hotel (CENTEL) Hotel > 14 month reconstruction Owned by CPN partially damaged & Now open > Will resume operation in November 2011 (tentative) Owned by CPN & leased out to ZEN Department Store under re construction Source: Company preliminary investigation. Note 1: Insurers and relevant independent experts are investigating and assessing the actual damage. 46