FIRST HOTEL — Interim / Quarterly Report 2017

Nov 30, 2017

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Date: December 1, 2017 FIRST HOTEL 2017 FINANCIAL BRIEFING Time: 3:00 p.m.

DISCLAIMER

• This Presentation contains certain forward-looking statements which are based on current expectations.

• However, due to known and unknown risks as well as uncertainties, the actual results may differ materially from those expressed or implied.

• Except as required by law, this company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise.

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AGENDA

Company introduction Market analysis Competitor analysis Financial overview Conclusion

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COMPANY INTRODUCTION: PROFILE

 Company establishment: October, 1962

 Official registration: 27, September, 1968

 IPO date: 25, June, 1991

• Taiwan Stock Exchange Code: 2706

 Paid-in Capital: NTD 4,865,216,950

 Chairman: Mr. An-Shen Ku

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COMPANY INTRODUCTION: OUR HOTEL

• First Hotel is centrally located at the heart of the buzzling Taipei City, on Nanking East Road

 First Hotel provides our guests the convenience and comfort they need while traveling in Taipei with its great location, easy access to major attractions, and the various dining options available on site

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COMPANY INTRODUCTION: FOOD & BEVERAGES

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MARKET ANALYSIS (1 OF 4): FOREIGN VISITORS ~~Number of Foreign Visitors to Taiwan in past 10 years, by country (unit: # of people)~~

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Source: Taiwan Tourism Bureau, Republic of China (Taiwan)

MARKET ANALYSIS (2 OF 4): FOREIGN VISITORS

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Jan-Sep in 2017 Foreign Visitors, by Country Jan-Sep in 2016 Foreign Visitors, by Country
6% [3% 2% ]
6% [3% 2% ]
10% 26% 8%
36%
15%
16%
19%
18% 17% 13%
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Source: Taiwan Tourism Bureau, Republic of China (Taiwan)

MARKET ANALYSIS (3 OF 4): IN/OUTBOUND TRAVELERS

Jan-Sep in 2016 & 2017 in-bound & out-bound traveler analysis (unit: # of people)

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2016 2017 2016 2017
In-Bound Out—Bound
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Source: Taiwan Tourism Bureau, Republic of China (Taiwan)

MARKET ANALYSIS (4 OF 4): IN/OUTBOUND TRAVELERS

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2016 First Hotel, Origin of Clients 2015 First Hotel, Origin of Clients
3% 2%
3% 2%
38%
32%
57%
63%
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2015 First Hotel, Origin of Clients

South East Asia North East Asia North America Others

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Note: South East Asia includes China, Hong Kong, Macau, and Taiwan; North East Asia includes Japan and Korea North America includes USA and Canada

Source: First Hotel

COMPETITOR ANALYSIS (1 OF 2)

Unit: New Taiwan Dollars

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Taiwan Hotel Industry 2016 & 2015 Earnings per Share
Category Stock # Company Name 2016 2015 YoY Change
2702 Hotel Holiday Garden 0.62 0.58 0.04
2704 Ambassador Hotel 1.16 1.13 0.03
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	COMPETITOR ANALYSIS (1 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (1 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (1 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (1 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (1 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (1 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (1 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (1 OF 2) Unit: New Taiwan Dollars
	Taiwan Hotel Industry 2016 & 2015 Earnings per Share Category Stock # Company Name 2016 2015 YoY Change 2702 Hotel HolidayGarden 0.62 0.58 0.04 2704 Ambassador Hotel 1.16 1.13 0.03
		Taiwan Hotel Industry 2016 & 2015 Earnings per Share
		Category	Stock #	Company Name	2016	2015	YoY Change
			2702	Hotel HolidayGarden	0.62	0.58	0.04
			2704	Ambassador Hotel	1.16	1.13	0.03
		Main	2705	Leo Foo	(1.05)	0.35	(1.40)
			2706	First Hotel	1.11	1.02	0.09
		Board	2707	Regent	7.29	8.78	(1.49)
			2712	Far Glory	0.59	0.84	(0.25)
			2722	Chateau	1.37	1.59	(0.22)
			2739	MHH	2.63	3.00	(0.37)
			2748	Fleur de Chine	3.18	3.02	0.16
		OTC	2718	Pleasant Hotels	0.56	1.53	(0.97)
			2724	FX Hotels-KY	(15.76)	(3.91)	(11.85)
			2736	Hoya Resort	0.89	5.91	(5.02)
			5701	Janfusun	(1.37)	(1.27)	(0.10)
			5703	Landis Taipei	0.34	1.04	(0.70)
			5704	Hotel Royal	0.32	1.05	(0.73)
			8077	Green World Hotels	(2.07)	(0.23)	(1.84)

Source: Market Observation Post System

COMPETITOR ANALYSIS (2 OF 2)

Unit: New Taiwan Dollars

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COMPETITOR ANALYSIS (2 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (2 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (2 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (2 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (2 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (2 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (2 OF 2) Unit: New Taiwan Dollars	COMPETITOR ANALYSIS (2 OF 2) Unit: New Taiwan Dollars
Taiwan Hotel Industry 2017 Q1~Q3 & 2016 Q1~Q3 Earnings per Share Category Stock # Company Name 2017Q1~ Q3 2016 Q1~Q3 YoY Change Main Board 2702 Hotel HolidayGarden 0.21 0.52 (0.31) 2704 Ambassador Hotel 0.98 0.91 0.07 2705 Leo Foo (1.03) (0.87) (0.16) 2706 First Hotel 0.84 0.88 (0.04) 2707 Regent 5.61 4.99 0.62 2712 Far Glory 0.14 0.58 (0.44) 2722 Chateau 0.83 1.24 (0.41) 2739 MHH 0.32 1.58 (1.26) 2748 Fleur de Chine 2.20 2.30 (0.10) OTC 2718 Pleasant Hotels (0.05) 0.34 (0.39) 2724 FX Hotels-KY (2.49) (9.42) 6.93 2736 Hoya Resort (0.04) 1.04 (1.08) 5701 Janfusun (1.06) (1.12) (0.06) 5703 Landis Taipei (0.37) (0.25) (0.12) 5704 Hotel Royal 0.09 0.46 (0.37) 8077 Green World Hotels 0.17 (1.25) 1.42
		Taiwan Hotel Industry 2017 Q1~Q3 & 2016 Q1~Q3 Earnings per Share
	Category	Stock #	Company Name
				2017Q1~ Q3	2016 Q1~Q3	YoY Change
		2702	Hotel HolidayGarden	0.21	0.52	(0.31)
		2704	Ambassador Hotel	0.98	0.91	0.07
		2705	Leo Foo	(1.03)	(0.87)	(0.16)
		2706	First Hotel	084	088	(004)
	Main Board			.	.	.
		2707	Regent	5.61	4.99	0.62
		2712	Far Glory	0.14	0.58	(0.44)
		2722	Chateau	0.83	1.24	(0.41)
		2739	MHH	0.32	1.58	(1.26)
		2748	Fleur de Chine	2.20	2.30	(0.10)
	OTC	2718	Pleasant Hotels	(0.05)	0.34	(0.39)
		2724	FX Hotels-KY	(2.49)	(9.42)	6.93
		2736	Hoya Resort	(0.04)	1.04	(1.08)
		5701	Janfusun	(1.06)	(1.12)	(0.06)
		5703	Landis Taipei	(0.37)	(0.25)	(0.12)
		5704	Hotel Royal	0.09	0.46	(0.37)
		8077	Green World Hotels	0.17	(1.25)	1.42

Source: Market Observation Post System

FINANCIAL OVERVIEW：BALANCE SHEET

Unit: NTD thousand

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2017 (as of Sep. 30 [th] ) 2016 (as of Dec. 31 [st] ) 2016 (as of Sep. 30 [th] )
Item
Amount Percentage Amount Percentage Amount Percentage
Current Asset 2,523,233 27% 2,344,377 25% 2,365,111 26%
Non-Current Asset 6,985,505 73% 6,929,351 75% 6,812,739 74%
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	FINANCIAL OVERVIEW：BALANCE SHEET Unit: NTD thousand	FINANCIAL OVERVIEW：BALANCE SHEET Unit: NTD thousand	FINANCIAL OVERVIEW：BALANCE SHEET Unit: NTD thousand	FINANCIAL OVERVIEW：BALANCE SHEET Unit: NTD thousand	FINANCIAL OVERVIEW：BALANCE SHEET Unit: NTD thousand	FINANCIAL OVERVIEW：BALANCE SHEET Unit: NTD thousand	FINANCIAL OVERVIEW：BALANCE SHEET Unit: NTD thousand	FINANCIAL OVERVIEW：BALANCE SHEET Unit: NTD thousand	FINANCIAL OVERVIEW：BALANCE SHEET Unit: NTD thousand
	Item 2017 (as of Sep. 30th) 2016 (as of Dec. 31st) 2016 (as of Sep. 30th) Amount Percentage Amount Percentage Amount Percentage Current Asset 2,523,233 27% 2,344,377 25% 2,365,111 26% Non-Current Asset 6,985,505 73% 6,929,351 75% 6,812,739 74%
		Item	2017 (as of Sep. 30th)		2016 (as of Dec. 31st)		2016 (as of Sep. 30th)
			Amount	Percentage	Amount	Percentage	Amount	Percentage
		Current Asset	2,523,233	27%	2,344,377	25%	2,365,111	26%
		Non-Current Asset	6,985,505	73%	6,929,351	75%	6,812,739	74%
		Total Asset	9,508,738	100%	9,273,728	100%	9,177,850	100%
		Current Liability	174,130	2%	89,562	1%	154,637	2%
		Non-Current Liability	1,097,298	11%	1,085,948	12%	1,061,783	11%
		Total Liability	1,271,428	13%	1,175,510	13%	1,216,420	13%
		Paid-in Capital	4,865,217	51%	4,504,830	48%	4,504,830	49%
		Additional Paid-in Capital	76,031	1%	76,031	1%	76,031	1%
		Retained Earnings	2,630,965	28%	2,674,122	29%	2,603,366	28%
		Other Equities	665,097	7%	843,235	9%	777,203	9%
		Total Equities	8,237,310	87%	8,098,218	87%	7,961,430	87%
		Book Value per Share	16.93		17.98		17.67

Source: First Hotel

FINANCIAL OVERVIEW： INCOME STATEMENTS Unit: NTD thousand

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Item 2017 Q1 2017 Q2 2017 Q3 2017 Q1-Q3 2016 Q1-Q3
Revenue 83,247 81,764 81,698 246,709 250,767
Rental revenue 51,469 51,164 52,699 155,332 154,747
Hotel revenue 31,778 30,600 28,999 91,377 96,020
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	FINANCIAL OVERVIEW： INCOME STATEMENTS Unit: NTD thousand	FINANCIAL OVERVIEW： INCOME STATEMENTS Unit: NTD thousand	FINANCIAL OVERVIEW： INCOME STATEMENTS Unit: NTD thousand	FINANCIAL OVERVIEW： INCOME STATEMENTS Unit: NTD thousand	FINANCIAL OVERVIEW： INCOME STATEMENTS Unit: NTD thousand	FINANCIAL OVERVIEW： INCOME STATEMENTS Unit: NTD thousand	FINANCIAL OVERVIEW： INCOME STATEMENTS Unit: NTD thousand	FINANCIAL OVERVIEW： INCOME STATEMENTS Unit: NTD thousand
	Item 2017 Q1 2017 Q2 2017 Q3 2017 Q1-Q3 2016 Q1-Q3 Revenue 83,247 81,764 81,698 246,709 250,767 Rental revenue 51,469 51,164 52,699 155,332 154,747 Hotel revenue 31,778 30,600 28,999 91,377 96,020
		Item	2017 Q1	2017 Q2	2017 Q3	2017 Q1-Q3	2016 Q1-Q3
		Revenue	83,247	81,764	81,698	246,709	250,767
		Rental revenue	51,469	51,164	52,699	155,332	154,747
		Hotel revenue	31,778	30,600	28,999	91,377	96,020
		Operating cost	22,985	24,426	23,208	70,619	65,210
		Gross profit	60,262	57,338	58,490	176,090	185,557
		Operating expenses	7,347	7,347	7,559	22,253	23,072
		Operating income	52,915	49,991	50,931	153,837	162,485
		Non-operating income	71,017	127,673	129,375	328,065	352,090
		Pre-tax income	123,932	177,664	180,306	481,902	514,575
		Income tax expense	21,031	26,464	27,080	74,575	84,405
		Net income	102,901	151,200	153,226	407,327	430,170
		Other comprehensive income (OCI)	(141,881)	4,901	(41,158)	(178,138)	(158,231)
		Total comprehensive income	(38,980)	156,101	112,068	229,189	271,939

Source: First Hotel

CONCLUSION

• Continuous effort to maintain competitiveness in current market

• Proactively develop new clienteles, including both foreign and domestic travelers

• Look for diversified investment opportunities to enhance company yield

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Source: First Hotel