FORWARD-LOOKING STATEMENTS

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2 FORWARD-LOOKING STATEMENTS This presentation and subsequent discussion contain certain forwardlooking statements with respect to the financial condition, results of operations 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 or 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 otherwise. You should not place any undue reliance on any forward-looking statements.

3 INTRODUCTION Joseph Tcheng Chairman

4 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 4

5 FY16 RESULTS HIGHLIGHTS (RMB M) FY15 FY16 YOY% Turnover 1,486 1, % EBITDA % EBIT % Net profit % Basic EPS (RMB) Final DPS (HK cents) % % 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) 5

6 FINANCIAL REVIEW Teo Hong Kiong Chief Financial Officer

7 FY16 CONSOLIDATED INCOME STATEMENT (RMB M) FY15 FY16 YoY% Turnover 1,486 1, % Cost of sales, excluding amortization (554) (586) +5.9% Operating expenditure, excluding depreciation & amortization (289) (321) +10.9% EBITDA % Depreciation & amortization (290) (325) 12.3% EBIT % Net profit % Basic EPS (RMB) % Final DPS (HK cents) % *Reporting currency changed to RMB for more precise reporting 7

8 COSTS & EXPENSES (RMB M) FY15 FY16 YoY% Rental % Maintenance % Electricity % Sales & Cultural Tax % Direct operating costs % S, G & A & other expenses % Total costs & expenses, excluding depreciation & amortization % 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 8

9 TRADE RECEIVABLES (RMB M) Dec 31, 2015 Jun 30, 2016 Dec 31, 2016 Current 90 days days Over days Over 360 days Less: provision for impairment (26) (30) (37) 3rd party receivables 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 9

10 INCREASE IN CASH FLOWS (RMB M) FY15 FY16 YoY% % 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 flows from operating activities Net cash & cash equivalents at the beginning of period effect of foreign exchange rate changes, net at the end of year 10

11 REVIEW OF STRATEGY & EXECUTION Harrison Zhang Chief Operating Officer

12 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 12

13 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% 13

14 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 14

15 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% 15

16 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 16

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