CATHAY RED — Investor Presentation 2016

Nov 29, 2016

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Cathay Real Estate Development Co., Ltd.

★ Quality Lifetime Homes ★

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Disclaimer Statement

• This presentation contains forward looking statements which are estimated based on the current status of Cathay Real Estate Development Co., Ltd. and general economic conditions. The forward looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward looking statements . Potential risks and uncertainties include such factors as general economic conditions, foreign exchange fluctuations, rising costs of raw materials, competitive products and pricing pressures and regulatory developments.

• Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved.

• C at h ay ea R l E state eve opment o., t D l C L d . express y l di sc a ms any o l i bli gat on to i review, update or correct these materials after the date thereof. Cathay Real Estate Development Co., Ltd. may update, amend, supplement or otherwise alter the information contained in any such materials by subsequent presentations, reports, filings, or other means without notice. This presentation may not be stored, copied, distributed, transmitted.

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Content

• Company Brief

• Financial Data

• Consolidated Income Statement

• Consolidated Balance Sheet

• Operating Results & Business Strategy

• � Ordinary Business: Current progress of the project execution

• Re-Investment: Current planning and future trend

• Real-estate Market Prospects

• Presale Market Overview

• The Factors Affect Housing Market

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Company Brief

Domest c i Domestic Re-investment Ordinary Business � Set up Cathay Real Estate Management in 2005 � Continuing project Established in 1964 � Set up Cathay Healthcare promotions in the with one hundred Management in 2011 northern, middle million in capital � Set up aC thay ospH itality and southern areas. Listed on TWSE Management in 2012 in 1967, stock code � Active participation Overseas investments 2501. in joint construction � Established Shangha i and urban renewal Jiaheng in 2011 with brand � Established Shanghai recognition. Lujing in 2012

Start from Home Healthcare , Develop the 3H (Home, , Hospitality)

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Consolidated Income Statement

		2013 2014 2015 2016Q3 EPS、Cash Dividend：NTD/Per Share	2013 2014 2015 2016Q3 EPS、Cash Dividend：NTD/Per Share	2013 2014 2015 2016Q3 EPS、Cash Dividend：NTD/Per Share	2013 2014 2015 2016Q3 EPS、Cash Dividend：NTD/Per Share	2013 2014 2015 2016Q3 EPS、Cash Dividend：NTD/Per Share	2013 2014 2015 2016Q3 EPS、Cash Dividend：NTD/Per Share	2013 2014 2015 2016Q3 EPS、Cash Dividend：NTD/Per Share	2013 2014 2015 2016Q3 EPS、Cash Dividend：NTD/Per Share	2013 2014 2015 2016Q3 EPS、Cash Dividend：NTD/Per Share
	It	2013		2014		2015		2016Q3
	em	NT$bn	% of Rev.	NT$bn	% of Rev.	NT$bn	% of Rev.	NT$bn	% of Rev.
	Revenue	8.14	100%	9.89	100%	9.85	100%	11.49	100%
	Gross Profit	2 59	32%	4 32	44%	3 48	36%	3 03	26%
		.		.		.		.
	Operating Profit	1.48	18%	3.00	31%	2.40	25%	2.25	19%
	Non-operating
	revenue and expenses	0.19	2%	0.15	1%	0.04	-	-	-
	Net Profit	1.58	19%	2.86	29%	2.19	22%	1.80	16%
	Parent Net Profit	1.69	20%	2.95	30%	2.33	23%	1.93	17%
	EPS	1.02		1.78		1.40		1.22**
	Cash Dividend*	1.0		1.0		1.0		-

*Based on the payout year.

EPS=1 . 66(Based on 1 . 16billion shares)**

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Consolidated Balance Sheet(1/2)

	Item	2013	2013	2014	2014	2015	2015	2016Q3	2016Q3
		NT$bn	%	NT$bn	%	NT$bn	%	NT$bn	%
	Lnd fr
	a o Construction	8.43	17%	11.92	21%	11.70	19%	8.41	14%
	Construction in Progress	16.28	33%	19.24	34%	22.25	36%	16.23	28%
	Buildings and Land Held for Sale	1.04	2%	1.45	3%	0.66	1%	8.78	15%
	Others	0.88	2%	0.52	-	0.20	-	0.06	-
	Total Inventories	26.63	54%	33.13	58%	34.81	56%	33.48	57%
	Cash and Cash	4 63	9%	3 00	5%	3 50	6%	1 35	2%
	Equivalents	.		.		.		.
	Investment Property	11.63	23%	11.98	21%	13.15	21%	13.85	24%
	L t ong- erm investment - Equity	0.03	-	0.04	-	0.03	-	0.02	-
	Total	50.36	100%	57.13	100%	61.93	100%	58.71	100%
	A t sse s

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Consolidated Balance Sheet(2/2)

		2013 2014 2015 2016Q3 Equity Per Share：NTD/Per Share	2013 2014 2015 2016Q3 Equity Per Share：NTD/Per Share	2013 2014 2015 2016Q3 Equity Per Share：NTD/Per Share	2013 2014 2015 2016Q3 Equity Per Share：NTD/Per Share	2013 2014 2015 2016Q3 Equity Per Share：NTD/Per Share	2013 2014 2015 2016Q3 Equity Per Share：NTD/Per Share	2013 2014 2015 2016Q3 Equity Per Share：NTD/Per Share	2013 2014 2015 2016Q3 Equity Per Share：NTD/Per Share	2013 2014 2015 2016Q3 Equity Per Share：NTD/Per Share
	It	2013		2014		2015		2016Q3
	em	NT$bn	%	NT$bn	%	NT$bn	%	NT$bn	%
	Total Borrowing	15.65	31%	20.89	37%	24.30	39%	21.72	37%
	Advances from Customers	8.12	17%	9.24	16%	8.48	14%	7.23	12%
	Total
	Liabilities	25 97 .	52%	31 40 .	54%	35 87 .	58%	36 48 .	62%
	Capital (per share	16.57	33%	16.57	29%	16.57	27%	11.60	20%
	NT$10)
	Parent Equity	23.46	46%	24.83	44%	25.26	41%	21.56	37%
	Total Equity	24 39 .	48%	25 73 .	46%	26 06 .	42%	22 23 .	38%
	Equity Per Share	14.16		14.97		15.25		18.59

* Based on Parent Equity.

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Business Strategy

• Business Model

• Utilize premium brand image to create added value to land.

• Market driven sales strategy.

• D e liv e r y pe r petua l se rvi ces.

• Land Bank

• Mainly the lands in downtown area , adjoining lands in suburbs with complete residential functions.

• Diversified land development model (including urban renewal, joint construction… etc.)

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Operating Results

• Positive Profitability Expected

• Six new projects completed this year are continually handed over to buyers

• � Outstanding sales of listed projects which will be completed during 2017 to 2019

• � Sufficient Planned Development in Reserve � Approximately 50 billion dollars reserved for planned development

• Approximately 75% of the planned development located outside the northern area (north of Hsinchu )

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- Home Sales Performance(1/2)

	Project	Area	Total Amount (NT$bn)	Sales rate(%)	Year of completion	Year of completion	Year of completion	Year of completion
					2016	2017	2018	2019
	國泰雙璽	Taipei	7.0	Approximately sold out
	TWIN
	PARK	Taipei	5.0	70%
	府會園道	Taichung	6.0	Approximately sold out
	國泰璞匯	Taichung	2.8	80%
	頤湖苑	Taichung	3.0	Sold out
	綠博苑	Taichung	1.9	Sold out
	文海硯	Tainan	2.2	92%
	國泰金城	Taipei	1.7	Approximately sold out
	國泰沐善	Taipei	1.7	80%

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Home-Sales Performance(2/2)

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Total Sales Year of completion
Project Area Amount
(NT$bn) rate(%) 2016 2017 2018 2019
文林硯 Tainan 3.2 Up to 60%
御博苑 Taichung 2.2 93%
國泰R13
Approximately
Kaohsiung 2.6
馥建築 sold out
國泰賦都 Taoyuan 3.2 Up to 7 0%
DoubleA
Kaohsiung 1.9 Up to 50%
馥建築
國泰層峰 Taichung 4 5. 50%
O2馥建築 Kaohsiung 4.0 Up to 50%
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Investment Subsidiaries

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Presale Market Overview

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基期：2010=100
Trading Volume Index Housing Price Index
2012Q4
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A common concept of profit-sharing among the developers promotes the longstaggered consumer confidence. The market of the second-half year has Price outperformed the first half . However, based on the observation on long-term & tendencies, the overall performance in the middle and southern areas will Volume remain stable, while the quantity and function in northern area continues to retreat. The regional price of each area in the post market has shown the tendency of modified consolidation.

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The Factors Affect Housing Market

1. The policy of ownership taxation (land value tax, house tax) has impacted the . home buyers willingness and confidence

Government 2. Relevant home market policies, such as whether there is an effective Policy implementation of health check for old houses, public housing , promoted transparency of transaction data, will easily affect the supply-demand con di t on o i f t h e ent re uture mar i f k et. Positive export growth has lasted for months and the industrial production also Domestic present a substantial increase . The economic prosperity signal has been in Economy green light for 3 consecutive months. It has shown that a recovery of the domestic economy back to stability is in progress.

The global stock and exchange market has returned to its stability and recovered from the fluctuations due to Brexit. Europe and Japan continue to stimulate their International economies by adapting quantitative easing and lowering the interest rates, Economy which lead to a market with ample monies. On the other hand , the recent U.S. election results have cast a change on the later development in Asia Pacific and an anticipation of rising interests rates and inflation , which represent further uncertainties.

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