http://www.poya.com.tw/en/

Agenda

I. Introduction

II. Competitive Advantages

III. Future Development

IV. Financial Performance

2

Introduction

I. Company Intro

II. Milestones

III. Core Value

IV. Sale Allocation

V. Customers

VI. Branches

3

Company Intro

Chairman

Listing on Taipei Exchange

Capital

Mr. Chen, Jian-Zao

6th Sep, 2002

NTD 0.98 billion

Number of Staff 4,092 (Feb, 2018)

Number of Stores 181 (Now)

4

5

Milestones

2014 Operate the 100 store at the end of October

2009 Establish the headquarters in Taipei

1975 Originate from night market and traditional market in Tainan

1993 Establish first branch in Kaohsiung; GM Mr. Chen Zong-Cheng join the team

1994 Establish the chain system; set up 1st generation CIS

2002 Listed on the Taipei Exchange in Taiwan

2006 Card-debt crisis in Taiwan; reform the stores to 3rd generation

2012 Focus on management innovation; implement the program for 4th

generation stores; further increase customer value

1998 Operate 10 stores; upgrade the CIS to 2nd generation

2014 Win the “Chin-Kuei Prize-Employment Promotion” awarded by Taipei Exchange

2017 Be ranked in top 5% of the TPEx-listed companies in "2016 Corporate Governance

Evaluation" hold by TWSE (For Three Consecutive Years)

Position

Female Product Shop

More Choices

High-quality Products

Easy Purchases

6

7

Target Customers -Female, Aged between 15~49

Sale Allocation

8 Ps. Accessories & Textile: includes accessories, socks, leather goods and underwear.

0%

2%

4%

6%

8%

10%

12%

14%

16%

Accessories&Textile Skin Care Cosmetics Household Bath Food Other Beauty Hardware Groceries

15% 15% 15% 14%

10% 10% 9%

5% 4%

3%

Locations of 181 Stores in Taiwan

Southern Taiwan 68 stores

Central Taiwan 50 stores

Northern Taiwan 63 stores

9

Competitive Advantages

I. Largest Market Share

II. Explicit Market Distinction

10

Largest Market Share 78% in the Market

0

20

40

60

80

100

120

140

160

180

POYA MIRADA A+1 J-MART SEASONS

181

29

5 9 9

11

Explicit Market Distinction

Pharmacy:15,000sku POYA:53,000sku

40% 60%

1. Medicine & contact lenses & maintenance products

2. Nutritional supplement

3. Private brand

30%

POYA’s Products 23%

FMCG

12

Non-FMCG

Future Development

I. Keep Upgrading the Stores and Products

II. Keep Opening New Stores

III. Improve Logistic System

13

Keep Upgrading the Stores and Products

14

Brand Image Promotion

Product Mix Optimization

Easy

Purchase

Offering

15

Upgrade Stores & Products -Keep Creating Fashion Sense in Stores

Upgrade Stores & Products -Hotspots Enhance Product Impressions

17

Upgrade Stores & Products -Introduce New Products by Market Trend

18

Estimated Market Size 400 Stores - Keep Fast Store Expansion

Undeveloped Market: 167 Stores

42%

1. A store should be support by 40,000 people

2. With the population of 23 million, the maximum of stores=575

3. Estimated number of effective stores: 575*70%=400

4. Market size: 400 stores

Developed Market: 233 Stores

58%

0

100

200

300

400

74 87

109

98 stores

275(f)

125 stores

400(f)

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

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Enlarge Scope & Benefit by Increasing Store Number

131 157

177

Female Product in Taipei Main Station

20

Female Product in Taipei Hsimenting

21

Female Product in Taipei Shilin Night Market

22

Female Product in Taichung Fengjia Night Market

23

Female Product in Tainan Night Market

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Logistic System -Before

1 2 N 4 3

1 4 3 2 N

● ● ● ● ● ● ● ●

● ● ● ● ● ●

Goods Purchase → Goods Return →

25

Logistic System -After

● ● ● ● ● ● ● ● 1 2 N 4 3

1 4 3 2 N ● ● ● ● ● ● ●

Logistic System

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Goods Purchase → Goods Return →

Financial Performance

I. Trend of Revenue

II. Trend of Gross Profit Margin

III. Trend of Operating Profit Margin

IV. Trend of Net Income Margin

V. Dividend Policy

VI. 2017 Financial Report

27

Trend of Revenue

28

(TWDm)

IFRS ROC GAAP

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

3,156 3,437 4,097

4,881 5,597

6,118 6,278 6,700

7,249

9,168

10,688

12,424 13,262

2,329

Trend of Gross Profit Margin

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IFRS ROC GAAP

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

26.80% 28.70% 28.20% 28.20%

29.20% 28.70% 30.40%

32.60%

35.40%

39.66% 40.48% 40.96% 41.11%

42.82%

Trend of Operating Profit Margin

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0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

4.27%

5.50%

3.89% 4.21% 4.85%

4.01% 4.58%

5.70%

6.83%

8.23%

9.76% 10.56%

10.95%

12.98%

IFRS ROC GAAP

Trend of Net Income Margin

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IFRS ROC GAAP

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

3.44%

4.91%

3.57% 3.73% 4.18%

3.49%

4.67% 5.36%

6.47%

7.71% 8.43%

8.91% 9.41%

10.78%

Trend of Net Income

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IFRS ROC GAAP

-

200

400

600

800

1,000

1,200

1,400

1,600

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

105 155 123 153 204 195 286 336

433

563

772

772

1,169

1,429

(TWDm)

Dividend Policy -Mainly in Cash Dividend

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2.5 3.08 2.69 3.26

3.76

4.75

6.03

8.22

10

12.13

1.8 1.8 0.5

2.8 3.28

4.1 4.8

7.4

8.8

10.7

72% 58% 19% 86% 87% 86% 80% 90% 88% 88% 0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

EPS(after tax)

Cash Dividend

Cash Dividend

Payout Ratio

Income Statements Accounting Title 2017 2016

Operating revenue

Total operating revenue 13,262,071 12,423,746 Operating costs

Total operating costs 7,583,371 7,316,193 Gross profit (loss) from operations 5,678,700 5,107,553 Operating expenses

Selling expenses

Total selling expenses 3,350,051 3,107,195 Administrative expenses

Total administrative expenses 606,827 639,502 Total operating expenses 3,956,878 3,746,697 Net operating income (loss) 1,721,822 1,360,856 Non-operating income and expenses

Other income

Total other income 50,953 49,570 Other gains and losses

Other gains and losses, net -39,671 8,013 Finance costs

Finance costs, net 10,259 8,271 Total non-operating income and expenses 1,023 49,312 Profit (loss) from continuing operations before tax 1,722,845 1,410,168 Tax expense (income) Total tax expense (income) 293,788 240,684 Profit (loss) from continuing operations 1,429,057 1,169,484 Profit (loss)1 1,429,057 1,169,484 Total comprehensive income 1,429,057 1,169,484 Basic earnings per share

Basic earnings (loss) per share from continuing operations 14.63 8.99 Total basic earnings per share 14.63 8.99 Diluted earnings per share

Diluted earnings (loss) per share from continuing operations 14.58 11.97 Total diluted earnings per share 14.58 11.97

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Balance Sheet Accounting Title 2017 2016 Accounting Title 2017 2016

Assets Liabilities

Current assets Current liabilities

Cash and cash equivalents Notes payable

Total cash and cash equivalents 972,251 833,134 Total notes payable 58,027 614,262 Notes receivable, net Accounts payable

Notes receivable, net 8,307 10,419 Total accounts payable 1,644,272 969,035 Accounts receivable, net Other payables

Accounts receivable, net 678,875 655,900 Total other payables 644,116 569,960 Other receivables Current tax liabilities 173,229 150,265 Other receivables, net 7,595 3,482 Other current liabilities 568,917 442,346

Inventories Advance receipts

Total inventories 2,638,948 2,314,815 Total advance receipts Prepayments Long-term liabilities, current portion

Total prepayments 101,032 93,790 Total long-term liabilities, current portion 793,335 556,275 Other current assets Other current liabilities, others

Other current financial assets 23,151 30,612 Total other current liabilities

Total other current assets 25,915 41,050 Total current liabilities 3,088,561 2,745,868 Total current assets 4,430,659 3,942,152 Non-current liabilities

Non-current assets Long-term borrowings

Property, plant and equipment Total long-term borrowings 793,335 556,275 Total property, plant and equipment 2,621,317 2,127,895 Deferred tax liabilities

Deferred tax assets 32,698 28,330 Total deferred tax liabilities 3,431 3,160 Other non-current assets Other non-current liabilities

Guarantee deposits paid Net defined benefit liability, non-current

Other non-current financial assets Guarantee deposits received

Total other non-current financial assets Total other non-current liabilities 13,977 14,174 Long-term prepaid rents Total non-current liabilities 810,743 573,609 Other non-current assets, others Total liabilities 3,899,304 3,319,477 Total other non-current assets, others Equity Total other non-current assets 444,455 365,453 Share capital Total non-current assets 3,098,470 2,521,678 Ordinary share 976,850 964,760 Total assets 7,529,129 6,463,830 Stock dividend to be distributed

Total capital stock 976,850 964,760

Capital surplus

Total capital surplus, additional paid-in capital 640,419 552,861

Total capital surplus 640,419 552,861

Retained earnings

Legal reserve 569,643 452,695

Total unappropriated retained earnings (accumulated deficit) 1,442,913 1,174,037

Total retained earnings 2,012,556 1,626,732

Total equity 3,629,825 3,144,353

Total liabilities and equity 7,529,129 6,463,830

Equivalent issue shares of advance receipts for ordinary share 0 0

Number of shares in entity held by entity and by its subsidiaries 0 0 35

Statements of Cash Flows Accounting Title 2017 2016 Accounting Title 2017 2016

Cash flows from (used in) operating activities, indirect method Interest received 2,277 2,337

Profit (loss) from continuing operations before tax 1,722,845 1,410,168 Interest paid -10,259 -8,271

Profit (loss) before tax 1,722,845 1,410,168 Income taxes refund (paid) -274,656 -212,998

Adjustments Net cash flows from (used in) operating activities 1,815,737 1,418,109

Adjustments to reconcile profit (loss) Cash flows from (used in) investing activities

Depreciation expense 445,546 387,934 Acquisition of property, plant and equipment -937,682 -972,666

Interest expense 10,259 8,271 Proceeds from disposal of property, plant and equipment 763 258,102

Interest income -2,277 -2,337 Increase in refundable deposits -31,645 -45,903

Loss (gain) on disposal of property, plan and equipment 38,309 -9,089 Increase in other financial assets 0 -24,562

Total adjustments to reconcile profit (loss) 491,837 384,779 Decrease in other financial assets 7,461 0

Changes in operating assets and liabilities Increase in other non-current assets -1,298 -359

Changes in operating assets Decrease in other non-current assets

Decrease (increase) in notes receivable 2,112 -3,180 Other investing activities -49,311 -20,681

Decrease (increase) in accounts receivable -22,975 -89,174 Net cash flows from (used in) investing activities -1,011,712 -806,069

Decrease (increase) in other receivable -4,113 -1,126 Cash flows from (used in) financing activities

Decrease (increase) in inventories -324,133 -247,177 Proceeds from long-term debt 1,460,000 911,841

Decrease (increase) in prepayments -7,242 13,651 Repayments of long-term debt -1,091,954 -617,386

Total changes in operating assets -356,351 -327,006 Increase in guarantee deposits received 0 1,472

Changes in operating liabilities Decrease in guarantee deposits received -161 0

Increase (decrease) in notes payable -556,235 51,971 Cash dividends paid -1,032,293 -838,441

Increase (decrease) in accounts payable 675,237 -41,783 Other financing activities 0 0

Increase (decrease) in other payable 127,050 152,949 Net cash flows from (used in) financing activities -664,408 -542,514

Increase (decrease) in receipts in advance -7,040 3,737 Net increase (decrease) in cash and cash equivalents 139,617 69,526

Increase (decrease) in other current liabilities 2,625 3,961 Cash and cash equivalents at beginning of period 833,134 763,608

Increase (decrease) in net defined benefit liability

-1,593 -1,735 Cash and cash equivalents at end of period 972,751 833,134

Total changes in operating liabilities 240,044 169,100 Cash and cash equivalents reported in the statement of financial position

972,751 833,134

Total changes in operating assets and liabilities -116,307 -157,906

Total adjustments 375,530 226,873

Cash inflow (outflow) generated from operations 2,098,375 1,637,041

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www.poya.com.tw/en/