March 21, 2006 2005 Final Results - Giordano 1

March 21, 2006 2005 Final Results - Giordano 2

Group Financial HighlightsGroup Financial HighlightsFor the Year Ended December 31, 2005

YOY change (%)2005 2004

Turnover (HK$M) 4,413 4,003 + 10.2

Gross profit (HK$M) 2,243 2,035 + 10.2

EBITDA (HK$M) 672 636 + 5.7

Operating profit (HK$M) 518 491 + 5.5

Profit attributable to shareholders (HK$M) 406 387 + 4.9

Earnings per share (HK cents) 27.5 26.7 + 3.0

Dividend per share - interim (HK cents)

- special interim (HK cents)

- final (HK cents)

- special final (HK cents)

- total for year (HK cents)

4.5

2.0

5.0

15.0

26.5

4.0

1.5

4.5

13.0

23.0 + 15.2

Dividend payout ratio (%) 96.4 86.1

March 21, 2006 2005 Final Results - Giordano 3

Selected Financial Highlights & RatiosSelected Financial Highlights & Ratios For the Year Ended December 31, 2005

2005 2004

Net cash & bank balances (HK$M) 827 689

Cash inflow from operating activities (HK$M)

489 327

Inventory turnover on sales (days) 31 30

Current ratio (x) 2.6 2.4

Gross margin (%) 50.8 50.8

Operating margin (%) 11.7 12.3

Net margin (%) 9.2 9.7

March 21, 2006 2005 Final Results - Giordano 4

Divisional HighlightsDivisional HighlightsFor the Year Ended December 31, 2005

Turnover Operating Profit

Division 2005

(In HK$M)

2004

(In HK$M)YOY % Change

2005

(In HK$M)

2004

(In HK$M)YOY % Change

Retail &

Distribution4,002 3,739 + 7.0 460 437 + 5.3

Garment Trading & Manufacturing

1,043 824 + 26.6 58 51 + 13.7

Intra-division Elimination

(632) (560) + 12.9 - 3 -

Total 4,413 4,003 + 10.2 518 491 + 5.5

March 21, 2006 2005 Final Results - Giordano 5

Retail & Distribution DivisionRetail & Distribution DivisionFor the Year Ended December 31, 2005

Retail & Distribution Turnover Composition by Market

Mainland China25% (25%)

Hong Kong22% (22%)

Taiwan 18% (19%)

Singapore10% (10%)

Others19% (19%)

Australia6% (5%)

Note:2004 figures in brackets

March 21, 2006 2005 Final Results - Giordano 6

Retail & Distribution DivisionRetail & Distribution DivisionFor the Year Ended December 31, 2005

Retail & Distribution Turnover Composition by Brand

Giordano Ladies5% (4%)

Bluestar Exchange 8% (8%)

Giordano core line + Junior87% (88%)

Note:2004 figures in brackets

March 21, 2006 2005 Final Results - Giordano 7

Retail & Retail & DistributionDistribution Division DivisionFor the Year Ended December 31, 2005

Total comparable store sales - 0.5%

Total comparable store gross profit + 0.9%

ASP increased for all three brands

Brand StatisticsBrand Statistics

Giordano Giordano core line + core line +

JuniorJuniorGiordano Giordano

LadiesLadiesBluestar Bluestar ExchangeExchange

Retail & Retail & DistributiDistribution Totalon Total

2005 Turnover

(HK$ M)3,487 185 330 4,002

Turnover Growth

(YOY % Change)+ 6.8 + 13.1 + 5.8 + 7.0

Gross Margin

(YOY Basis Point Change)

+ 110 + 100 + 190 + 120

March 21, 2006 2005 Final Results - Giordano 8

Retail & Distribution DivisionRetail & Distribution DivisionMarket RevieMarket Review – Mainland Chinaw – Mainland China

• Late winter hurt sales in 4Q05.

• Full year sales up 4%; sales per sq. ft. held constant. Overall ASP increased.

• All brands posted gross margin improvements.

• Added 35 outlets in 2005.

• Plans to add about 40 outlets in 2006 (30 Giordano and 10 Bluestar). * Includes all outlets

** Includes directly managed outlets only

Sales

(HK$M)

Sales per

Sq. ft. (HK$)Comp. Store Sales Chg.

Retail Floor area (ft2)

No. of Outlets

2005 987 * 2,400 ** + 6% ** 585,600 * 706 *

2004 952 * 2,400 ** + 7% ** 557,800 * 671 *

March 21, 2006 2005 Final Results - Giordano 9

• Sales up 7%; sales per sq. ft. grow 4%.• All three brands achieved ASP increases.• Overall gross margins stayed relatively unchanged.• Added nine outlets in 2005.• Planning to add image store in Mongkok and renovate Causeway Bay flagship. • Also planning first Giordano Ladies airport store.

Retail & Distribution DivisionRetail & Distribution DivisionMarket RevieMarket Review – Hong Kongw – Hong Kong

Sales

(HK$M)

Sales per

Sq. ft. (HK$)Comp. Store Sales Chg.

Retail Floor area (ft2)

No. of Outlets

2005 867 7,400 + 4% 119,500 101

2004 810 7,100 + 11% 113,700 92

March 21, 2006 2005 Final Results - Giordano 10

• Sales up 4%; sales per sq. ft. up 3%.• Deteriorating consumer confidence hurt sales. 2H05 sales down 6.8% YOY. • All brands showed gross margin and ASP improvements.• Net addition of one outlet in 2005.• Consumer sentiment remains weak due to negative household income growth and

consumer credit crunch.

Retail & Distribution DivisionRetail & Distribution DivisionMarket RevieMarket Review – Taiwanw – Taiwan

Sales

(HK$M)

Sales per

Sq. ft. (HK$)

Comp. Store Sales

Chg.

Retail Floor area(ft2)

No. of Outlets

2005 732 3,000 - 6% 243,900 237

2004 707 2,900 + 1% 245,800 236

March 21, 2006 2005 Final Results - Giordano 11

•Sales up 3%; sales per sq. ft. down 5% and comp store sales down 1%.•Gross Margins and ASP held steady.•Added one store in 2005. •Plans to open second Giordano Ladies store in 2006.

Retail & Distribution DivisionRetail & Distribution DivisionMarket RevieMarket Review – Singaporew – Singapore

Sales

(HK$M)

Sales per

Sq. ft. (HK$)

Comp. Store Sales

Chg.

Retail Floor area(ft2)

No. of Outlets

2005 403 8,300 - 1% 50,500 48

2004 391 8,700 + 13% 48,600 47

March 21, 2006 2005 Final Results - Giordano 12

•As a group, these markets achieved the 12% YOY sales growth, better than our

main markets.•Australia sales up 18% with 10 stores added, including first Bluestar store.•For Southeast Asia, sales growth mainly due to new store openings. Malaysia: 4;

Indonesia: 17; Thailand: 11.•Japan further narrowed its loss in 2005. Target to break even in 2006.

Retail & Distribution DivisionRetail & Distribution DivisionMarket RevieMarket Review – Other Group Marketsw – Other Group Markets

(in HK$M) Australia Malaysia Indonesia Thailand Japan Total

2005 222 126 139 91 63 641

2004 188 126 119 84 53 570

YOY Change

+ 18% - + 17% 8% + 19% + 12%

March 21, 2006 2005 Final Results - Giordano 13

•Sales up 11.2% year-on-year in South Korea. Sales down 0.9% in local currency

terms. 4 store closed in 2005.•Middle East sales up 15.3% year-on-year in 2005. 18 stores added in 2005.

Retail & Distribution DivisionRetail & Distribution DivisionMarket RevieMarket Review – Non-group Marketsw – Non-group Markets

Sales (HK$M)Comp. Store Sales

Chg.No. of Outlets

2005 2004 2005 2004 2005 2004

South Korea 995 895 - 4.0 - 13.4 168 172

Middle East 332 288 + 2.4 + 6.1 107 89

March 21, 2006 2005 Final Results - Giordano 14

Retail & Distribution DivisionRetail & Distribution DivisionNumber of Outlets, by Region and by BrandNumber of Outlets, by Region and by Brand

As at December 31, 2005As at

December 31, 2004

YOY ChangeGiordano

core lineGiordano

LadiesGiordano

JuniorBluestar

ExchangeTotal

Australia 51 - - 1 52 42 + 10

Hong Kong 55 8 - 38 101 92 + 9

Indonesia 55 - 7 - 62 45 + 17

Japan 21 - - - 21 24 -3

Korea 137 - 31 - 168 172 - 4

Mainland China 658 9 3 36 706 671 + 35

Malaysia 52 - 1 - 53 49 + 4

Middle East 107 - - - 107 89 + 18

Philippines 43 - - - 43 41 + 2

Singapore 40 1 7 - 48 47 + 1

Taiwan 162 8 7 60 237 236 + 1

Thailand 54 1 2 - 57 46 + 11

Others 34 - - 5 39 31 + 8

Total 1,469 27 58 140 1,694 1,585 + 109

March 21, 2006 2005 Final Results - Giordano 15

Garment Trading & Manufacturing DivisionGarment Trading & Manufacturing DivisionFor the Year Ended December 31, 2005

2005 2004YOY % change

Sales including internal sales (HK$M) 1,043 824 + 26.6

Sales to external customers (HK$M) 411 264 + 55.7

Percentage of Retail & Distribution’s total purchase

29.7% 28.0% NA

Operating Margin (%) 5.6% 6.2% NA

Contribution to the Group’s operating profit 11.2% 10.4% NA

• 60.6% of divisional sales to Group companies, down from 68.0% in 2004.• Operating margin declined by 0.6% because of increased competition.• Transitioning from an OEM to ODM model to cement customer relationships and grow sales and margins.

March 21, 2006 2005 Final Results - Giordano 16

OutlookOutlookGeneral• Continuing concerns about high oil prices, rising interest rates and

possible outbreak of avian flu.• Erratic weather negatively affected sales in Feb 2006.• Group turnover for the first two months of 2006 showed high single

digit YOY decline.• Situation improved in March, and inventory remains healthy.• We will focus on enhancing merchandising and customer care.

– Targeted merchandising to enhance comp store sales.– World Without Strangers global CRM program to enhance customer

loyalty.

March 21, 2006 2005 Final Results - Giordano 17

OutlookOutlookHong Kong• Strategic new store openings (HK Airport, Mongkok and Macau)

and refurbishment of Causeway Bay flagship to strengthen mark

et presence.• Sponsorship of 30th HKIFF to enhance brand image.• Focus on organic growth

Mainland China• Growth through new store openings (40) and comp store sales g

rowth• Grow wholesale turnover with better merchandising

March 21, 2006 2005 Final Results - Giordano 18

OutlookOutlook

Taiwan• Consumer confidence weakened by negative household

income growth and credit crunch• Increased cross-strait tensions• Focus on operations

Singapore• Second Giordano Ladies store planned for 2006

March 21, 2006 2005 Final Results - Giordano 19

OutlookOutlookSouth Korea• Slow and erratic recovery of retail sector.• Continued focus on gross margin enhancement and cost

controls in light of uncertain prospects.• Plans for 10 new stores in 2006.

India• Open first Giordano store in 2Q06• Measured store roll-out plan with 2-3 store openings in 2006

and a similar number in 2007• More aggressive roll-out after we have gained market

knowledge and experience