1 2007 Annual Results April 2008. 2 Disclaimer The presentation is prepared by “Guangdong Nan Yue...

1

2007 Annual Results

April 2008

2

Disclaimer

The presentation is prepared by “Guangdong Nan Yue Logistics Company Limited” (the “Company”) and is solely for the purpose of corporate communication and general reference only. The presentation is not intended as an offer to sell, or to solicit an offer to buy or to form any basis of investment decision for any class of securities of the Company in any jurisdiction. All such information should not be used or relied on without professional advice. The presentation is a brief summary in nature and do not purport to be a complete description of the Company, its business, its current or historical operating results or its future business prospects.

This presentation is provided without any warranty or representation of any kind, either expressed or implied. The Company specifically disclaim all responsibilities in respect of any use or reliance of any information, whether financial or otherwise, contained in this presentation.

Results Highlights

Financial Overview

Business Overview

Plans and Strategies

5

Results Highlights

• Steady growth in turnover and profit– Turnover increased by 22.3% to RMB6,890 Mil– Profit attributable to shareholders increased by 2.1% to RMB159

Mil

• Enhanced business network service coverage– Expanded logistics business in asphalt, coal, fuel, nickel ore and iron

ore powder– Fully Explored development potential of catering, convenience store

and advertising networks – Self-innovated various transportation intelligence products and built a

strong foothold outside Guangdong Province– Expanded cross border coaching service, by launching vehicle leasing s

ervice

• Strategic alliances enhanced brand equity– Sinopec– McDonald’s

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Turnover

EBIT

EPS – Basic (RMB yuan)

Financial Overview

2007

22.3

254.0

1.8

0.38

2.1

YOY (%)2006

159.0

277.2

6,889.7

Operating Profit

Profit Attributable to Shareholders

1.9

RMB Million

—

5,635.4

259.0

0.37

155.8

272.3

0.11DPS (RMB yuan) 0.11

For the year ended 31 December

Results Highlights

Financial Overview

Business Overview


8


3,000

3,500

4,000

4,500

5,000

5,500

6,000

6,500

7,000

2006 2007

Steady Turnover Growth

Turnover

RMB Million

Strong development of material logistics service business which turnover increased by 22.3%

+22.3%

5,635

6,890

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ExpresswayService Zones

6.57%

Cross-borderCoachingServices

4.65%

MaterialLogisticsServices75.51%

TransportationIntelligence

Services11.06%

Tai PingInterchange

Toll Collection1.85%

Others0.36%

ExpresswayService Zones

5.82%

Cross-borderCoachingServices

3.83%


TransportationIntelligence

Services7.65%

Tai PingInterchange

Toll Collection1.84%

Turnover Breakdown

Revenue breakdown for the year ended 31 December 2007

Revenue breakdown for the year ended 31 December 2006

Total: RMB 5,635.4 Mil



Total: RMB 6,889.7Mil

10

350

400

450

500

550

600

650

2006 2007

0%

5%

10%

15%

20%

Gross Profit Gross Profit Margin

RMB Million

Gross Profit

• GP increased due to:– The increase in turnover

• GP margin slightly decreased due to:

– Higher cost and lowerGP margin for logistics business during the early development stage

– Lower margin for expressway service zones and cross-border coaching services

+3.2%

Gross Profit

598

10.6%

9.0%

617


0

11

87.82109.9

84.15%86.41%

0

30

60

90

FY2006 FY2007

65.12 64.46

24.86% 24.42%

0

20

40

60

FY2006 FY2007

105.1598.92

19.95%15.87%

55

65

75

85

95

105

115

FY2006 FY2007

210.29 208.22

4.94%3.74%

100

150

200

250

FY2006 FY2007

129.2125.98

34.05%

50

70

90

110

130

FY2006 FY2007

Segment Gross ProfitRMB million

6.3%

RMB million

0.98％

RMB million

2.55%

RMB million

Material Logistics Services Transportation Intelligence Services

Expressway Service Zones Cross-border Coaching Services

Tai Ping Interchange

1.02%

RMB million

32.23%

25.14%

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Healthy Financial Ratios

Total Assets (RMB Million)

Net Cash Flow from OperatingActivities (RMB Million)

2007

21.8

41.3

5.1

YOY (%)2006

Cash and Cash Equivalent (RMB Million)

501.0

N.A.

Debt to Assets (%)

Current Ratio (x) 1.3x

435.4

68.5%

947.6

4,567.6

72.4

65.2%

670.6

3,750.9

1.3x

As at 31 December

Results Highlights

Financial Overview

Business Overview


14

Company Profile

A Leading of Logistics & Expressway Related Services

Conglomerate in Guangdong Province

Cross-border

Coaching Services


Transportation Intelligence

Services

Material Logistics Services

Expressway Service Zones

Nan YueLogistics

15

• The Group’s major revenue and profit contributor, accounted for:

– 81% of total revenue;– 34% of Group’s gross profi

t

Integrated Material Logistics Services

A leading material logistics service providers for

sizable infrastructure projects in Guangdong

• Segment revenue was increased due to:– Expansion in customer base

– Increase in types of materials served

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• Handled 23 material logistics projects

Integrated Material Logistics Services

Total materials supplied

Cement : 632,900 tonnesSteel :1,380,700 tonnes(steel bars and steel stands) Asphalt : 166,300 tonnesCoal : 120,200 tonnesNickel Ore : 55,600 tonnesIron ore powder : 383,700 tonnesFuel : 56,000 tonnes

Projects involved:

Expressway projects: Western Coastal, the Pearl River Delta Western Ring, Jingzhu, Shanjie, Guanghe, Taiao, Fokai, Yunwu, DongxinRailway projects: Guangzhou Metro Nos. 4, 5, 6, Wu-Guang, Between Guangzhou and Zhuhai, Between Guangzhou, Shenzhen and Hong Kong

17


• Accounted for :– 6% of total revenue;– 21% of Group’s gross profit

• Operates 5 major networks include:

In respect of professionalizing the expressway service zones chained operational business, the Group has attained breakthrough progress in 2007

Convenience stores

Catering operation

Car maintenance Petrol stations Advertising services

18


• Segmental revenue was increased due to:– The continuing improvement in expressway service zones network

as well as the sales and marketing– The increase in turnover of catering and convenience stores resulti

ng from increase in passages flow– The natural growth of traffic volume

Leveraged on scale advantage of chained operations through: – Standardizing the types of food a

nd beverages by cooperation with famous brand

– Focused the development of the light box advertisement and electronic information inquiry system

– Using sewage treatment and water recycling system to preserve the environment

– Established warehouses for enhancing efficiency of goods delivery

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Transportation Intelligence Services

• Segmental revenue slightly decreased due to:– Delays in the constructions of expressways in Guangdong Provin

ce– Revenue wll be realized at a later time for new projects outside

Guangdong Province

• Accounted for:– 8% of total revenue;– 17% of Group’s gross profit

20

Transportation Intelligence Services

• Services further enhanced by : – Portable and handheld toll collection devices

were sold in 10 provinces and cities– car-plate identification products and wireless

video recording products were well received by customers and on the pipeline for market promotion

– unattended automatic card machine entered into Hubei province market

– New software products such as web-cam household surveillance were developed, such as web-cam household surveillance and will be launched soon

– “materials trading platform” and “bridge safety surveillance” were being implemented

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• Segmental revenue remains stable

Cross-border Coaching Services


• Services further improved by– Enhanced carriage rate by adjusting coaching routes– Improved coaching service by adjusting stops and schedules

based on customer source changes– Installed GPS devices at all vehicles

Major HK’s cross-border coach operator in terms of fleet size, bus frequency and operated routes

22


• Segmental revenue increaseddue to :

– Rapid economic growth in Guangdong province which lead to a steady growth of vehicle flow

– Stable cost after the completion of upgrading the integrated toll collection systems


Results Highlights

Financial Overview

Business Overview


24

Prospects

• Establish logistics infrastructures and extend supply chain

• Develop business with good prospects in service zone network

• Alliances with renowned enterprises to betterenhance brand equity

• Enhance operation quality and strengthen marketing strategies for TIS

• Develop new business for cross-border coaching services

• Growth in the demand for new software in intelligent transportation

• Growth in demand for logistics services driven by economic prosperity

• Untapped potential for the different business networks in service zone

• Transportation system reform

• Unexplored market operations

To seize market opportunitiesMarket opportunities

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• Establish network of logistics service business– Expand types of material logistics business

– Develop the market outside Guangdong Province

– Strengthen communication with manufacturers

– Expedite construction pace of asphalt network to implement strategic development asphalt business • Enhance service quality and brand equity

of expressway service zones– Standardize and extend the operational

coverage of food and beverage to the entire service network

– Introduce special retailers with special local products into service zones

– Promote large-scale advertising operation

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• Promote development and application of advanced transportation technology– Increase our market share in Guangdong Province

– Develop the market outside Guangdong Province

– Enhance technical innovation capability of new products

– Enhance the promotions on our latest products

• Cross-border coaching services– Develop the new market on the MPV leasing

services

– Co-operate with other companies to expand our business

Financial Overview

Business Overview

Plans and Prospects

Investment Highlights

Q & A

1 2007 Annual Results April 2008. 2 Disclaimer The presentation is prepared by “Guangdong Nan Yue...

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