Vincom Retail Jsc · HOSE:VRE

Vincom Retail Jsc — Vincom Retail — Investor Presentation (September 2018)

28 slides from Vincom Retail Jsc's investor presentation, September 2018

1. Slide 1: Corporate Presentation

   Corporate Presentation September 2018

2. Slide 2: Disclaimer

   Disclaimer IMPORTANT: The information contained herein is preliminary and subject to change without notice, its accuracy is not guaranteed, has not been independently verified and may not contain all material information concerning Vincom Retail Joint Stock Company (the “Company”) and its subsidiari

3. Slide 3: Executive Summary

   Executive Summary Vincom Retail (“VCR”) is the largest and fastest growing retail developer, owner and operator in Vietnam Key investment highlights are as follows:    Vietnam at an Economic Modern Retail Set to Largest and Most and Consumption Take Off Dominant Retail Platform Inflection Point P

4. Slide 4: Vingroup & Vincom Retail: Market Leaders in Vietnam

   Vingroup & Vincom Retail: Market Leaders in Vietnam Largest Listed Company in Vietnam(1)  Vincom Retail  A Key Subsidiary of Largest Real Estate Developer in Vietnam Vingroup JSC c.174mm sqm of Landbank(2)  Hanoi 55(4) Ecosystem of Complementary Businesses Vincom Retail Operational Malls Largest

5. Slide 5: Emergence of Vincom Retail as a Clear Market Leader

   Emergence of Vincom Retail as a Clear Market Leader Establishing Platform Accelerating Growth With Early Years & Formation For Growth Dominant Market Share 2004 - 2013 2014 2015 2016 2017 1H2018  First Vincom  Vincom Mega  10 new Vincom  Listed on HOSE in  Launched 5 new Vincom  Royal City sho

6. Slide 6: Retail Consolidates Around the Dominant Local Landlord

   Retail Consolidates Around the Dominant Local Landlord  dominant local landlord Global examples clearly demonstrate retail consolidation around the Vincom Retail  Significant parallels seen between VCR and regional retail leaders Vietnam’s largest retail developer, owner and operator  Vietnam's G

7. Slide 7: Key Investment Highlights

   Key Investment Highlights

8. Slide 8: Key Investment Highlights

   Key Investment Highlights Vietnam at a Favourable Economic and Consumption Inflection 1 Point Huge Potential for Further Expansion in Vietnam’s Retail Space  Modern Retail Set to Take Off 2  Only Retail Platform With Nationwide Access  Metro Infrastructure Will Accelerate Retail Mall Footfall Mul

9. Slide 9: Vietnam at a Favourable Economic and Consumption Inflection Point

   1 Vietnam at a Favourable Economic and Consumption Inflection Point Fastest Growing Economy in Southeast Asia with Strongest Middle Highest Population Proportion Among Workforce Income Growth… Population with Age Range Between 25 – 44 as % of Total Population (2017) 2018E – 2020E real GDP growth (%)

10. Slide 10: Huge Potential for Further Expansion in Vietnam's Retail Space

    2 Huge Potential for Further Expansion in Vietnam’s Retail Space Low and fast growing disposable income per capita compared to neighboring countries, coupled with low mall GFA, presents an opportunity to enlarge Vietnam’s retail mall space to close the regional gap. …With the Growing Middle Class Se

11. Slide 11: Modern Retail Set to Take Off

    2 Modern Retail Set to Take Off Vietnam is Starved for Modern Retail Format E-Commerce More Catalyst Than Threat Significantly Underpenetrated Modern Non-Discretionary Retail Remains E-Commerce Penetration(1) 2017 modern grocery retail as part of total retail by value (%) (%) 27.8% 28.6% 2017A 2021F

12. Slide 12: Only Retail Platform With Nationwide Access

    2 Only Retail Platform With Nationwide Access Portfolio Leasing Creates Significant Bargaining Power… … and Ability to Attract Best-in-Class Tenant Portfolio, with about 1,000 Unique Tenants(4) Inditex Brands HANOI HAI PHONG • 55 malls across 30 DA NANG cities and Fashion & Beauty provinces(1) • 4 r

13. Slide 13: Metro Infrastructure Will Accelerate Retail Mall Footfall

    2 Metro Infrastructure Will Accelerate Retail Mall Footfall Most of VCR malls are covered by the upcoming metro lines in Ho Chi Minh City and Hanoi – significant boost in connectivity and footfall expected. Ho Chi Minh City Gò Vấp Thủ Đức Hanoi Trung Thôn VINCOM PLAZA Tân Bình SAIGON RES VINCOM CENT

14. Slide 14: Multi Format Model Covers a Larger Market Opportunity

    3 Multi Format Model Covers a Larger Market Opportunity Household Annual Income Holistic Segment Coverage Across Formats Competitors Distribution (% of Households Vincom Center Vincom Mega Mall Vincom Plaza Vincom+ in Vietnam)(1) Above Target Segment: Lotte US$20,000  City Center/ Target p.a CBD co

15. Slide 15: Accelerated Roll-out of Vincom Retail Malls Throughout Vietnam

    3 Accelerated Roll-out of Vincom Retail Malls Throughout Vietnam Vincom Malls and Related Vingroup Brands: A …Via Penetrative Multiple Product Formats Dominant Platform Set for Future Growth… Vincom Vincom Vincom Brand Vincom+ North Vietnam Center Mega Mall Plaza 9 Vincom Malls Key Cities 7 Vincom P

16. Slide 16: Ability to Leverage the Best-in-Country Vingroup Ecosystem

    4 Ability to Leverage the Best-in-Country Vingroup Ecosystem c.174mm Access to Landbank from 35 – 40% Market Leading Retail Brands Form sqm of Landbank Vietnam’s Biggest Developer Preleased area on Immediate Tenant Foundations Date of Opening Vingroup’s Landbank Breakdown  At least 15  mm sqm year

17. Slide 17: Operational Update

    3. Operational Update

18. Slide 18: Performance Overview – 1H2018

    Performance Overview – 1H2018 Revenue from Gross Profit(2) Leasing(1) VND2,642 billion VND1,554 billion 21.5% YoY 12.0% YoY Leasing NOI(3) EBITDA(4) VND1,860 billion VND2,239 billion 26.3% YoY 23.3% YoY Note: Based on VAS Reviewed Consolidated Interim Financial Statements for the six-month period en

19. Slide 19: Key Operational Metrics

    Key Operational Metrics Average Occupancy Retail GFA Change 1H2017 1H2018 Figure in sqm 1H2017 1H2018 Change (%) (bps) Vincom Center 90.9% 93.0% 210 Vincom Center 165,876 165,876 - Vincom Mega Mall 80.7% 88.2% 750 Vincom Mega Mall 395,148 395,148 - Vincom Plaza 92.2% 87.7% (450) Vincom Plaza 520,515

20. Slide 20: Sales and Marketing Activities

    Sales and Marketing Activities Tenant Update for 1H2018 Tenant Mix by NLA Key Tenants Joining in 2017 and 1H2018 As at June 2018 27.7% 19.3% 22.9% 16.9% 13.2% Fashion Food & Beverage Hypermarket / Supermarket Entertainment Others  Organized several tenant programs to promote collaborations and shar

21. Slide 21: Malls Opening from 2018E – 2019E

    Malls Opening from 2018E – 2019E 45 malls to be opened in 2018E – 2019E 15 malls To be opened in 2H2018 Malls Opening by Format Format 2H 2018E 2018E – 2019E Vincom Center 2 4 Vincom Mega Mall - - Vincom Plaza 10 28 Vincom+ 3 13 Total opening 15 45 Total operational malls as of end of period 66 91 2

22. Slide 22: Financials and Capital Management Update

    4. Financials and Capital Management Update

23. Slide 23: Financial Performance – 1H2018

    Financial Performance – 1H2018 Total Revenue Gross Profit(1) VNDbn VNDbn Gross Profit Margin (%) 33.7% 41.4% 50.8% 50.8% 49.6% 6,386 5,958 24 264 5,518 112 2,556 951 2,642 2,801 8 48 3,267 2,007 411 1,388 1,554 3,134 (2) 623 2,734 25 18 0 51 492 607 163 4,455 560 2,342 274 3,805 2,011 1,401 1,096 1,

24. Slide 24: Balance Sheet

    Balance Sheet Total Assets Inventory VNDbn VNDbn 2,294 38,133 35,961 36,087 34,299 1,817 14,276 16,652 13,739 1,483 16,251 683 21,685 21,481 22,348 18,048 31-Dec-15 31-Dec-16 31-Dec-17 30-Jun-18 31-Dec-15 31-Dec-16 31-Dec-17 30-Jun-18 (1) Investment Properties and Investment Properties Under Constru

25. Slide 25: Leverage and Coverage ratios

    Leverage and Coverage ratios Net Debt(1) / (Total Assets – cash & cash equivalents(2)) Net Debt(1) / Equity 5.5% 7.2% 3.6% 4.6% 31-Dec-17 30-Jun-18 31-Dec-17 30-Jun-18 Total Debt / Equity Interest Coverage Ratio(3) Times 22.9% 11.1 7.4 10.2% 31-Dec-17 30-Jun-18 1H2017 1H2018 Note: Based on VAS Audit

26. Slide 26: Appendix

    Appendix

27. Slide 27: Financial Performance in 1H2018 vs. 1H2017

    Financial Performance in 1H2018 vs. 1H2017 Change Figures in VND billion 1H2017 1H2018 Commentary (%) Leasing of Investment Mainly came from 13 malls opened from Q3 2017 to Q2 2018 Properties and Rendering 2,174 2,642 21.5 and increased occupancy from existing malls. of Related Services(1) 1H2018: d

28. Slide 28: Bridging VAS to IFRS

    Bridging VAS to IFRS VAS 1H2018 Adjustment IFRS 1H2018 Commentary on Adjustments Leasing revenue and other related services 2,618 39 2,657 Realized unearned revenue of deposit from customer in relation to Sale of residential inventory 492 492 amortization of deposit Other revenue 25 25 Total revenue

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