COURTS ASIA LIMITED UNAUDITED RESULTS FOR THE SECOND QUARTER ENDED 30 SEPTEMBER 2016 FINANCIAL STATEMENTS AND DIVIDEND ANNOUNCEMENT

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1 1(a)(i) Statement of total comprehensive income (for the ) together with a comparative statement for the corresponding period of the immediately preceding financial year. Q2 Q2 % H1 H1 % FY16/17 FY15/16 Change FY16/17 FY15/16 Change S$'000 S$'000 S$'000 S$'000 Revenue 180, ,139 (3.0) 376, ,291 (1.9) Cost of sales (119,301) (120,427) 0.9 (244,754) (250,259) 2.2 Gross profit 61,246 65,712 (6.8) 132, ,032 (1.4) Other income and other gains/(losses) - net 1, ,470 1, Expenses - Distribution and marketing (12,794) (13,712) 6.7 (27,774) (30,266) Administrative (35,425) (36,936) 4.1 (74,229) (74,039) (0.3) - Finance (5,328) (7,162) 25.6 (11,094) (14,159) 21.6 Profit before income tax 8,719 8,813 (1.1) 21,497 17, Income tax expense (2,020) (2,795) 27.7 (5,382) (5,433) 0.9 Net profit 6,699 6, ,115 12, Q2 Q2 % H1 H1 % FY16/17 FY15/16 Change FY16/17 FY15/16 Change S$'000 S$'000 S$'000 S$'000 Net profit 6,699 6, ,115 12, Other comprehensive income: Items that may be reclassified subsequently to profit or loss: Currency translation differences (2,524) (17,302) 85.4 (7,648) (25,029) 69.4 Fair value (loss) / gain on hedging (69) 1, (163) 2, Total comprehensive income / (loss) 4,106 (9,423) ,304 (10,603)

2 1(a)(ii) Breakdown and explanatory notes to the statement of total comprehensive income:- Q2 Q2 H1 H1 FY16/17 FY15/16 FY16/17 FY15/16 S$'000 S$'000 S$'000 S$'000 Profit before income tax was arrived at after charging/ (crediting): Depreciation and amortisation of property, plant and equipment and intangible assets 3,180 3,453 6,542 6,730 Amortisation of deferred income (704) (733) (1,331) (1,323) Impairment allowance on trade receivables 5,437 4,601 11,187 10,794 Other income and other gains/(losses) - net - Interest income (650) (653) (1,499) (1,304) - Loss on disposal of property, plant and equipment (net) Rental income (495) (324) (888) (567) - Others (85) (82) (333) (273) (1,020) (911) (2,470) (1,927) Finance costs - Interest expense on borrowings 4,924 5,499 10,134 10,597 - Interest expense on finance lease liabilities Amortisation of borrowing costs Foreign exchange losses - net 49 1, ,701 5,328 7,162 11,094 14,159 Gross profit as a percentage of revenue 33.9% 35.3% 35.1% 34.9% Net profit as a percentage of revenue 3.7% 3.2% 4.3% 3.1% Net profit as a percentage of total equity 2.3% 2.2% 5.5% 4.4% at the end of financial period 2

3 1(b)(i) Statement of financial position (for the issuer and ), together with a comparative statement as at the end of the immediately preceding financial year. Company 30 Sep Mar Sep Mar 16 S$'000 S$'000 S$'000 S$'000 ASSETS Current assets Cash and bank balances 76, ,509 16,764 77,489 Trade and other receivables 268, ,178 7,796 75,963 Inventories 85,565 77, Current income tax recoverable , ,930 24, ,452 Non-current assets Derivative financial instruments Trade and other receivables 288, ,327 19,486 23,611 Investments in subsidiaries , ,840 Property, plant and equipment 23,147 24, Intangible assets 23,334 23,580 20,065 20,065 Deferred income tax assets 7,574 4, , , , ,517 Total assets 772, , , ,969 LIABILITIES Current liabilities Derivative financial instruments Trade and other payables 138, ,293 2,256 5,391 Current income tax liabilities 6,020 3,506 1,211 2,131 Borrowings 15, , ,444 Deferred income 2,406 2, , ,462 3, ,966 Non-current liabilities Derivative financial instruments Trade and other payables Borrowings 306, ,151 76,505 76,724 Deferred income 2,435 2, Deferred income tax liabilities 8,377 7,590 3,070 2, , ,096 79,575 79,644 Total liabilities 481, ,558 83, ,610 NET ASSETS 291, , , ,359 EQUITY Share capital 265, , , ,332 Treasury shares (18,381) (16,161) (18,381) (16,161) Other s (44,577) (36,822) (23,480) (23,536) Retained profit 88,959 79,515 27,979 29,724 Total equity 291, , , ,359 3

4 1(b)(ii) Aggregate amount of s borrowings and debt securities Amount repayable in one year or less, or on demand As at S$ 000 As at S$ 000 Secured Unsecured Secured Unsecured ,974 1, ,961 Amount repayable after one year As at S$ 000 As at S$ 000 Secured Unsecured Secured Unsecured 219,305 87, ,693 89,458 Details of any collateral The s borrowings of $322.6 million (31 March 2016: $371.2 million) consist of fixed rate notes and term loan in Courts Asia Ltd ( CAL ), the Asset Securitisation Programme 2016 in Singapore, Syndicated Senior Loan in Malaysia, and term loans in Indonesia. On 23 April 2013, a S$500 million Multicurrency Medium Term Note programme was established. A note issued on 2 May 2013 comprising of S$125 million 3-year unsecured fixed rate note was repaid in May A new note was issued on 15 March 2016 comprising of S$75 million 3-year unsecured fixed rate note due in March 2019 and is classified as non-current liability. The Asset Securitisation Programme 2016 (renewed in January 2016) is secured against the trade receivables of Courts (Singapore) Pte Ltd ( CSL ). CSL has also provided a guarantee and indemnity in favour of the Senior Beneficiaries, The Hong Kong and Shanghai Banking Corporation Limited ( HSBC ), DBS Bank Ltd ( DBS ) and Oversea-Chinese Banking Corporation, in respect of amounts payable under the Asset Securitisation Programme The Syndicated Senior Loan is secured by a fixed charge over the designated bank accounts of Courts (Malaysia) Sdn Bhd ( CMB ) and all credit balances in respect thereof, a debenture covering a fixed and floating charge over all the assets of CMB (both present and future), an assignment over existing and future trade receivables and corporate guarantee issued by CMB. The term loans in Indonesia comprise of a IDR185.2 billion (S$20 million) 2-year term loan repayable from January 2017 in 4 tranches quarterly secured in favour of DBS and a IDR78 billion (S$8 million) 3-year term loan repayable in May 2019 secured in favour of HSBC. Both term loans are secured by corporate guarantees from CAL. The term loan in CAL is a 7-year term loan from February 2015 with original amount of US$2.38 million (S$3.2 million) to finance the Key Man Insurance for certain key management personnel. The facility is secured by an assignment of the Jade Global Insurance Policies in favour of HSBC. 4

5 1(c) Consolidated statement of cash flows (for the ), together with a comparative statement for the corresponding period of the immediately preceding financial year. Q2 Q2 H1 H1 FY16/17 FY15/16 FY16/17 FY15/16 S$'000 S$'000 S$'000 S$'000 Cash flows from operating activities: Net profit 6,699 6,018 16,115 12,062 Adjustments for: Income tax expense 2,020 2,795 5,382 5,433 Depreciation and amortisation 3,180 3,453 6,542 6,730 Amortisation of deferred income (704) (733) (1,331) (1,323) Interest expense 4,930 5,519 10,147 10,633 Interest income (650) (653) (1,499) (1,304) Amortisation of borrowing costs Loss on disposal of property, plant and equipment (net) Share-based compensation Foreign currency translation differences 445 (5,078) 204 (6,839) Operating cash flow before working capital changes 16,598 12,129 36,882 26,717 Changes in working capital Inventories 1,133 4,495 (8,826) 697 Trade and other receivables (10,282) (16,124) (29,981) (39,794) Trade and other payables 11,034 16,162 1,675 21,503 Cash generated from / (used in) operations 18,483 16,662 (250) 9,123 Income tax paid (net) (2,076) (2,960) (3,863) (3,550) Net cash generated from / (used in) operating activities 16,407 13,702 (4,113) 5,573 Cash flows from investing activities Additions to property, plant and equipment (1,429) (2,941) (4,759) (5,869) Acquisition of intangible assets (332) (113) (551) (401) Proceeds from sale of property, plant and equipment Interest received ,476 1,284 Net cash used in investing activities (1,100) (2,400) (3,819) (4,985) Cash flows from financing activities Repayment of bond issued - - (125,120) - Repayment of finance lease liabilities (177) (402) (402) (810) (Repayment) / proceeds from term loan (366) 4,961 7,517 9,944 Repayment of term loan (67) (117) (161) (232) Proceeds from syndicated senior loan 3,155 16,795 5,384 18,447 Proceeds / (repayment) from loan received on asset securitisation 10,829 (26,955) 69,207 (11,151) Decrease / (Increase) in fixed deposits pledged as securities for banking facilities 165 (2,311) 959 (3,601) Purchase of treasury shares (1,152) (3,433) (2,384) (3,504) Interest paid (5,816) (4,022) (9,958) (8,161) Dividend paid (6,671) (6,932) (6,671) (6,932) Net cash used in financing activities (100) (22,416) (61,629) (6,000) Net increase / (decrease) in cash and cash equivalents 15,207 (11,114) (69,561) (5,412) Cash and cash equivalents as at beginning of financial period 56, , , ,383 Effects of currency translations on cash and bank balances (51) (3,807) (393) (5,828) Cash and cash equivalents as at end of financial period 71, ,143 71, ,143 For the purposes of the consolidated statement of cash flows, the cash and cash equivalents comprise the following: 30 Sep Sep 15 S$'000 S$'000 Cash and bank balances 52,726 71,030 Fixed deposits 23,870 35,550 76, ,580 Less: Fixed deposits pledged as securities for banking facilities (4,780) (5,437) Cash and cash equivalents per consolidated statement of cash flows 71, ,143 5

6 1(d)(i) A statement (for the issuer and group) showing either (i) all changes in equity or (ii) changes in equity other than those arising from capitalisation issues and distributions to shareholders, together with a comparative statement for the corresponding period of the immediately preceding financial year. Share capital Treasury Shares Attributable to equity holders of the Share option Currency translation Capital Hedging Retained profits Total equity $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 Balance at 1 April ,332 (16,161) 1,013 (42,788) 5,919 (966) 79, ,864 Purchase of treasury shares - (2,384) (2,384) Treasury shares reissued (140) - (24) - - Share-based compensation Total comprehensive income for the period (7,648) - (163) 16,115 8,304 Dividends (6,671) (6,671) Balance at 30 Sep ,332 (18,381) 1,093 (50,436) 5,895 (1,129) 88, ,333 Balance at 1 July ,332 (17,239) 984 (47,912) 5,895 (1,060) 88, ,931 Purchase of treasury shares - (1,152) (1,152) Treasury shares reissued - 10 (10) Share-based compensation Total comprehensive income for the period (2,524) - (69) 6,699 4,106 Dividends (6,671) (6,671) Balance at 30 Sep ,332 (18,381) 1,093 (50,436) 5,895 (1,129) 88, ,333 Share capital Treasury Shares Attributable to equity holders of the Share option Currency translation Capital Hedging Retained profits Total equity $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 Balance at 1 April ,332 (10,348) 881 (30,205) 5,962 (936) 66, ,855 Purchase of treasury shares - (3,504) (3,504) Treasury shares reissued 26 (22) (4) - Share-based compensation Total comprehensive income for the period (25,029) - 2,364 12,062 (10,603) Dividends (6,932) (6,932) Balance at 30 Sep ,332 (13,826) 1,143 (55,234) 5,958 1,428 71, ,100 Balance at 1 July ,332 (10,419) 968 (37,932) 5,962 (433) 72, ,691 Purchase of treasury shares - (3,433) (3,433) Treasury shares reissued - 26 (22) - (4) Share-based compensation Total comprehensive income for the period (17,302) - 1,861 6,018 (9,423) Dividends (6,932) (6,932) Balance at 30 Sep ,332 (13,826) 1,143 (55,234) 5,958 1,428 71, ,100 6

7 Share capital Company Attributable to equity holders of the Company Treasury Shares Share option Capital Retained profits Total equity $'000 $'000 $'000 $'000 $'000 $'000 Balance at 1 April ,332 (16,161) 1,013 (24,549) 29, ,359 Purchase of treasury shares - (2,384) (2,384) Treasury shares reissued 164 (140) (24) - Share-based compensation Total comprehensive income for the period ,926 4,926 Dividends (6,671) (6,671) Balance at 30 Sep ,332 (18,381) 1,093 (24,573) 27, ,450 Balance at 1 July ,332 (17,239) 984 (24,573) 32, ,922 Purchase of treasury shares - (1,152) (1,152) Treasury shares reissued - 10 (10) Share-based compensation Total comprehensive income for the period ,232 2,232 Dividends (6,671) (6,671) Balance at 30 Sep ,332 (18,381) 1,093 (24,573) 27, , Share capital Attributable to equity holders of the Company Treasury Shares Share option Capital Retained profits Total equity $'000 $'000 $'000 $'000 $'000 $'000 Balance at 1 April ,332 (10,348) 881 (24,506) 26, ,957 Purchase of treasury shares - (3,504) (3,504) Treasury shares reissued - 26 (22) (4) - - Share-based compensation Total comprehensive income for the period ,145 5,145 Dividends (6,932) (6,932) Balance at 30 Sep ,332 (13,826) 1,143 (24,510) 24, ,950 Balance at 1 July ,332 (10,419) 968 (24,506) 29, ,777 Purchase of treasury shares - (3,433) (3,433) Treasury shares reissued - 26 (22) (4) - - Share-based compensation Total comprehensive income for the period ,341 2,341 Dividends (6,932) (6,932) Balance at 30 Sep ,332 (13,826) 1,143 (24,510) 24, ,950 7

8 1(d)(ii) Details of any changes in the company's share capital arising from rights issue, bonus issue, share buy-backs, exercise of share options or warrants, conversion of other issues of equity securities, issue of shares for cash or as consideration for acquisition or for any other purpose since the end of the previous period reported on. State also the number of shares that may be issued on conversion of all the outstanding convertibles as well as the number of shares held as treasury shares, if any, against the total number of issued shares excluding treasury shares of the issuer, as at the end of the current financial period reported on and as at the end of the corresponding period of the immediately preceding financial year. There are no changes in the Company s share capital since 31 March Treasury shares During the period, the Company purchased 2,900,200 of its own shares for a total consideration of $1.2 million by way of market acquisition. In the same period, 24,788 treasury shares at fair value of $0.01 million were awarded pursuant to Performance Share Plan and for Director Fees. As at 30 September 2016, there are 43,349,346 shares (30 September 2015: 30,796,918) held as treasury shares. The total number of issued shares excluding treasury shares is 516,650,654 (30 September 2015: 529,203,082). 1(d)(iii) To show the total number of issued shares excluding treasury shares as at end of the current financial period and as at the end of the immediately preceding year. 30 Sept Mar 2016 Total number of issued shares excluding treasury shares 516,650, ,692,346 1(d)(iv) A statement showing all sales, transfers, disposal, cancellation and/or use of treasury shares as at the end of the current financial period reported on. Q2 FY16/17 Number of treasury shares reissued pursuant to Performance Share Plan and Director Fees 24, Whether the figures have been audited or reviewed and in accordance with which auditing standard or practice. The figures have not been audited or reviewed by the s auditors. 3. Where the figures have been audited or reviewed, the auditors report (including any qualifications or emphasis of a matter). Not applicable. 4. Whether the same accounting policies and methods of computation as in the issuer s most recently audited annual financial statements have been applied. The accounting policies adopted and methods of computation applied are consistent with those used in the recently audited financial statements of the for the financial year ended 31 March If there are any changes in the accounting policies and methods of computation, including any required by an accounting standard, what has changed, as well as the reasons for, and the effect of, the change. Not applicable. 8

9 6. Earnings per ordinary share of the group for the current financial period reported on and the corresponding period of the immediately preceding financial year, after deducting any provision for preference dividends. Q2 Q2 H1 H1 FY16/17 FY15/16 FY16/17 FY15/16 (a) Basic earnings per share (cents) (b) Fully diluted earnings per share (cents) Explanatory notes Basic earnings per share is calculated by dividing the 's profit after tax attributable to shareholders by the weighted average ordinary shares during the three months ended 30 September 2016 and the same period last year of 516,936,029 and 533,231,611 respectively. The weighted average ordinary shares for the six months ended 30 September 2016 and the same period last year were 519,161,474 and 535,709,075 respectively. In 2013, the Company granted certain key management personnel Courts Share Appreciation Rights ( SAR ) to motivate them to drive the long term success of the Company and to enhance shareholder returns. Under the SAR plan, each SAR represents the right to receive fully paid ordinary shares of the Company with zero exercise price. In the event that the market value of the share at the point of time of exercise is equal or less than the grant value, no shares will be awarded to the key management personnel. Estimated total number of outstanding shares under the SAR plan as at 30 September 2016 is zero. In November 2013, the Company granted Courts Asia FY13/14 Strategic Deferred Share Award ( FY13/14 DSA ) under Courts Asia Performance Share Plan to Selected Top Management. As at 30 September 2016, an award of 2,897,700 shares has been granted and each share represents a fully paid share. Out of the total award, 2,692,900 shares has been vested and awarded through reissuance of Treasury Shares. 204,800 shares have been forfeited to date and the total outstanding shares under DSA plan as at 30 September 2016 is zero (31 March 2016: 184,700). In September 2016, the Company granted Courts Asia FY15/16 Strategic Deferred Share Award ( FY15/16 DSA ) under Courts Asia Performance Share Plan to Selected Top Management. As at 30 September 2016, an award of 655,000 shares has been granted and each share represents a fully paid share. The awarded shares will vest based on 1/3 per annum, commencing a year from the grant date. No share has been vested as at 30 September In June 2015, the Company granted the Performance Share Award ( PSA ) to the Executive Directors and key management personnel pursuant to the Long Term Incentive Plans. Shares will vest to the participant after the end of each relevant vesting period provided certain performance conditions are achieved in accordance with the rules of the Plan. As at 30 September 2016, an award of 3,911,000 shares has been granted and each share represents a fully paid share. No share has been vested as at 30 September Diluted earnings per share is calculated by dividing the 's profit after tax attributable to shareholders by the weighted average ordinary shares during the three months ended 30 September 2016 and the same period last year of 521,502,029 and 533,724,011 respectively. The weighted average ordinary shares for the six month ended 30 September 2016 and the same period last year were 523,727,474 and 536,201,475 respectively. 9

10 7. Net asset value (for the issuer and group) per ordinary share based on the total number of issued shares excluding treasury shares of the issuer at the end of the:- (a) current financial period reported on; and (b) immediately preceding financial year. Company 30-Sep Mar Sep Mar-16 Net asset value per ordinary share (cents) A review of the performance of the group, to the extent necessary for a reasonable understanding of the group s business. It must include a discussion of the following:- (a) any significant factors that affected the turnover, costs, and earnings of the group for the current financial period reported on, including (where applicable) seasonal or cyclical factors; and (b) any material factors that affected the cash flow, working capital, assets or liabilities of the group during the current financial period reported on. Income Statement Period Ended 30 September 2016 Revenue The s revenue of $180.5 million for Q2 FY16/17 was 3.0% or $5.6 million lower than Q2 FY15/16. Singapore revenue which contributed to 65.5% of the s revenue in Q2 FY16/17 reported a marginal increase of 0.5% compared to Q2 FY15/16. Malaysia revenue, which contributed to 31.5% of the s revenue, reported 12.9% (in presentation currency) and 9.0% (in RM currency) decrease in Q2 FY16/17 as compared to Q2 FY15/16 mainly due to lower sales across all categories. Indonesia revenue, which contributed to 3.0% of the s revenue, registered a 70.2% (in presentation currency) and 35.8% (in Rupiah currency) increase in Q2 FY16/17 compared to Q2 FY15/16 mainly due to contributions from newly opened stores. Gross profit Gross profit for Q2 FY16/17 decreased by 6.8% or $4.5 million resulting from lower revenue and gross profit margin compared to Q2 FY15/16. Gross profit margin decreased from 35.3% in Q2 FY15/16 to 33.9% in Q2 FY16/17 mainly a result of lower earned service charge income in Malaysia, lower merchandise margin for the and due to the shifting of Hari Raya festival into Q1 FY16/17. The lower merchandise margin for the was mainly due to higher corporate sales and lower furniture sales mix. Distribution and marketing expenses Distribution and marketing expenses decreased by $0.9 million to $12.8 million in Q2 FY16/17 from $13.7 million in Q2 FY15/16. As a percentage of revenue, distribution and marketing expenses decreased to 7.1% in Q2 FY16/17 from 7.4% in Q2 FY15/16. This decrease was primarily attributable to lower advertising cost and the continuous efforts in improving the management of warehouse and distribution cost in Malaysia. Administrative expenses Administrative expenses decreased by $1.5 million to $35.4 million in Q2 FY16/17 from $36.9 million in Q2 FY15/16. The decrease was mainly due to a reversal of overpayment on GST for previous years, but offset by higher impairment allowance of trade receivables in Malaysia and higher occupancy costs for new stores in Indonesia, Malaysia and Singapore. 10

11 Finance expenses Finance expenses decreased by $1.9 million to $5.3 million in Q2 FY16/17 from $7.2 million in Q2 FY15/16 mainly due to lower exchange loss captured in Malaysia s books with the settlement of its Singapore dollar denominated inter-company loan and lower borrowings in Singapore, but offset by higher interest expenses in Indonesia due to increase in bank borrowings. Income tax expense Income tax expense of $2.0 million for Q2 FY16/17 was based on taxable profit from Singapore and Malaysia operations (Q2 FY15/16: $2.8 million). The decrease in tax expense of $0.8 million mainly as a result of income tax credits from Indonesia s loss and lower taxable profit from Malaysia, and it was partially offset by higher taxable profit from Singapore operations. The effective tax rate for Q2 FY16/17 was higher than the Singapore statutory tax rate of 17.0% mainly due to higher tax rate in Malaysia and non-tax deductible expenses. Total comprehensive income Total comprehensive income for Q2 FY16/17 was an income of $4.1 million as compared to loss of $9.4 million in Q2 FY15/16. The improvement was mainly due to higher profit and lower translation loss mainly arising from translating Malaysia s results and financial position into Singapore dollar (presentation currency) as at 30 September Balance Sheet As at 30 September 2016 Trade and other receivables The s trade and other receivables (current and non-current) increased by $16.7 million to $556.2 million as at 30 September 2016 from $539.5 million as at 31 March 2016 due to higher credit sales. Allowance for impairment of trade receivables as at 30 September 2016 was $25.2 million as compared to $24.2 million as at 31 March 2016 representing 4.1% of trade receivables at both period ends. Inventories The s inventories increased to $85.6 million as at 30 September 2016 from $77.8 million as at 31 March 2016 due to stocking up for upcoming tradeshows in Singapore. Current income tax recoverable Current income tax recoverable as at 30 September 2016 was zero balance as compared to $0.4 million as at 31 March The decrease was mainly due to tax credit relating to prior year tax assessments recovered from Malaysia. Derivative financial instruments Derivative financial instruments represent the carrying amount of interest rate and currency swaps that the has entered into to hedge its exposure to floating interest rate and exchange rate fluctuations on its bank borrowings. The has adopted hedge accounting in respect of the derivative financial instruments it has entered into in FY14/15. Derivative instrument is in a net liability position with the fair value loss in Q2 FY16/17 mainly attributed to the strengthening of Indonesia rupiah against Singapore dollar at the end of the financial reporting period. 11

12 Borrowings The total borrowings of $322.6million (31 March 2016: $371.2 million) consist of S$75 million 3-year unsecured fixed rate notes and term loan in Courts Asia Ltd ( CAL ), the Asset Securitisation Programme 2016 in Singapore, Syndicated Senior Loan in Malaysia, and term loans in Indonesia. The decrease was mainly due to the repayment of the S$125 million 3-year unsecured fixed rate notes in May 2016 and offset by additional drawdown in bank borrowings. Deferred income tax assets / liabilities - net The decrease in net deferred income tax liabilities as at 30 September 2016 was mainly due to increase in deferred tax assets arising from tax losses from Indonesia subsidiary. Cash and bank balances Cash and bank balances decreased by $70.9 million to $76.6 million as at 30 September 2016 from $147.5 million as at 31 March 2016 mainly as a result of repayment of the S$125 million 3-year unsecured fixed rate note in May 2016 and payment of dividends in August 2016, offset by additional drawdown in bank borrowings. 9. Where a forecast, or a prospect statement, has been previously disclosed to shareholders, any variance between it and the actual results. Statements / plans outlined previously (as per note 10 of Q1 FY16/17 announcement) have been completed or are on track as planned. 12

13 10. A commentary at the date of the announcement of the significant trends and competitive conditions of the industry in which the group operates and any known factors or events that may affect the group in the next reporting period and the next 12 months. According to advance estimates from the Ministry of Trade and Industry ( MTI ), the Singapore economy grew by 0.6% on a year-on-year basis in the third quarter of 2016, down from 1.8% in the same corresponding period 1. Singapore s Gross Domestic Product ( GDP ) growth is now expected to come in at the lower end of 1% to 2% this year 2. Retail sales excluding motor vehicles declined 6.5% in the month of August 2016, compared to a year ago 3. Similarly, retail sales for furniture and household equipment experienced a slowdown and fell 5.6% over the same period 3. Overall, consumer sentiment for the third quarter of 2016 remained low but stable. The Housing and Development Board ( HDB ) plans to launch approximately 5,090 BTO flats and 5,000 Sale of Balance Flats ( SBF ) in the upcoming exercise in November While the slowing economy is likely to dampen consumer sentiment in the short-term, the expects the increased supply of HDB flats to support the demand for furniture and other household appliances. In Malaysia, the World Bank has revised its 2016 forecast for the country s economic growth, trimming it down from 4.4% in April s forecast to 4.2% 5. However, World Bank is expecting Malaysia s GDP growth to improve to 4.3% in Leveraging the soft rental climate resulting from the macro environment, the intends to press ahead with store expansion plans to establish the Courts brand strongly in the market. As indicated in Q1 FY16/17 commentary, in line with Malaysia macro environment, the expects credit collections to remain challenging. Regional development bank Asian Development Bank has become slightly less optimistic about Indonesia s economic growth, cutting its forecast for Indonesia s economic growth from 5.2% to 5.0% 6. According to the Retail Sales Survey by Bank Indonesia, retail sales growth in August 2016 accelerated from 6.3% to 14.4% year-on-year. However, retailers were less upbeat on sales projection for the upcoming three and six months due to softer public demand and seasonal factors 7. Indonesia continues to be the s key growth market. Courts Asia remains on track to establish greater foothold in the Indonesian market. It recently opened two stores in Indonesia and expects to open two more stores during the financial year, bringing the total to nine. In summary, Courts Asia anticipates a challenging operating environment in its key markets in the nearterm, driven by a soft retail environment and macroeconomic pressures. However, the remains optimistic on the longer-term outlook, and is committed to delivering shareholder value through ongoing cost efficiency measures and productivity drives. 1 Singapore s GDP Grew by 0.6% in Third Quarter of 2016 ( Quarter-of-2016/AdvEst_3Q16.pdf) Ministry of Trade and Industry, October 14, Poor GDP figures point to long slowdown for Singapore ( The Straits Times, October 15, Retail Sales Index ( - Department of Statistics Singapore, October Release of 3rd Quarter 2016 Public Housing Data ( Housing & Development Board, October 28, World Bank cuts Malaysia growth amid weak global economy ( The Star Online, October 5, Asian Development Bank Cuts GDP Growth Forecast Indonesia ( Indonesia Investments, September 28, Retail Sales Survey August 2016 ( Bank Indonesia, October 18,

14 11. Dividend (a) Current Financial Period Reported On Any dividend declared for the current financial period reported on? None. (b) Corresponding Period of the Immediately Preceding Financial Year Any dividend declared for the corresponding period of the immediately preceding financial year? None. (c) Date payable Not applicable. (d) Books closure date Not applicable. 12. If no dividend has been declared/recommended, a statement to that effect. No dividend has been declared for the second quarter ended 30 September Interested Person Transactions There was no interested person transactions ( IPTs ) during the period ended 30 September The Company has not obtained a general mandate for IPTs from the shareholders. 14. Use of proceeds from the Company s initial public offering A total of $27.1 million has been invested from the date of incorporation of PT Courts Retail Indonesia ( PTCRI ) up to 30 September The balance of the proceeds has been placed in short term deposits with banks. The Board has decided that the balance of the proceeds will be re-allocated to use for future investments and expansions. 15. Disclosure of person occupying a managerial position in the issuer or any of its principal subsidiaries who is a relative of a director or chief executive officer or substantial shareholder of the issuer pursuant to Rule 704(11) in the format below. If there are no such persons, the issuer must make an appropriate negative statement. There was no person occupying a managerial position in the who is a relative of a director or chief executive officer or substantial shareholder of the. 16. Confirmation pursuant to Rule 705(5) of the Listing Manual On behalf of the Board of Directors, we, the undersigned, hereby confirm to the best of our knowledge that nothing has come to the attention of the Board of Directors which may render the financial statements for the period ended 30 September 2016 to be false or misleading. 17. Confirmation that the issuer has procured undertakings from all its directors and executives officers under Rule 720(1) The Company confirms that it has procured undertakings from all its Directors and executive officers in the format as set out in Appendix 7.7 under Rule 720(1) of the SGX-ST Listing Manual. 14

15 For and on behalf of the Board of Directors of Courts Asia Limited Terence Donald O Connor Chief Executive Officer 9 November 2016 Kee Kim Eng Chief Financial Officer 15