1 1

2016/17 Interim Results

22 Nov 2016

(Updated 13 Jan 2017)

Forward Looking Statement

This presentation and subsequent discussion may contain

certain forward-looking statements with respect to the

financial condition, results of operations and businesses of

Skyworth. These forward-looking statements represent

Skyworth’s expectations or beliefs concerning future

events and involve known and unknown risks and

uncertainties which could cause actual results,

performance or events to differ materially from those

expressed or implied in such statements.

2

Stable Gross Margin

Six months ended 30 Sep (HK$ million) 1H2016/17 1H2015/16 Change

Revenue 20,291 19,549 3.8%

Gross profit 4,170 4,023 3.7%

Gross margin 20.6% 20.6% 0.0pp

Operating profit (EBIT) 1,316 1,321 (0.4%)

Operating margin 6.5% 6.8% (0.3pp)

Profit for the period 948 985 (3.8%)

Net profit margin 4.7% 5.0% (0.3pp)

Attributable to non-controlling interests 112 116 (3.4%)

Attributable to owners of the Company 836 869 (3.8%)

(HK$ cents)

Basic EPS 28.83 30.66 (6.0%)

Diluted EPS 28.44 30.20 (5.8%)

Dividend per share 9.6 9.6 0.0%

Dividend payout (%) 34.4% 32.2% 2.2pp

3

Operating Expenses

S&D: Raise basic salary and benefits for frontline staff as incentives, input more A&P for OLED TV promotion, brand and market shares building. Revenue growth was weaker than the target.

G&A: R&D expenses (3.5% of sales) increased in investing in application software, smart TV users data collection and analysis, developing high-end, smart, energy-saving and health-caring products to sustain market leading position, cope with the consumption upgrade trend as well as to welcome smart home era.

Six months ended 30 Sep

(% to sales)

1H

2016/17

1H

2015/16 Change 2015/16

Selling and distribution 11.7% 11.4% 0.3pp 11.1%

General and administration 6.9% 5.3% 1.6pp 6.0%

Total expense rate 18.6% 16.7% 1.9pp 17.1%

4

Highly Liquid Position

(HK$ million) Sep 16 Sep 15 Change Mar 16 Change

Inventories

- Total

- Finished goods

6,075

3,676

4,623

2,944

31.4%

24.9%

5,494

3,509

10.6%

4.8%

Liquid bills receivable

- On hand - Endorsed to suppliers* - Discounted to banks#

4,552

-

463

4,624

4

387

(1.6%)

(100%)

19.6%

6,945

-

300

(34.5%)

0.0%

54.3%

(cash equivalent) 5,015 5,015 0.0% 7,245 (30.8%)

Pledged bank deposits 595 365 63.0% 493 20.7%

Cash and bank balances 4,418 4,163 6.1% 5,023 (12.0%)

Trade receivables 6,537 6,407 2.0% 5,290 23.6%

5

Net Cash

(HK$ million) Sep 16 Sep 15 Change Mar 16 Change

Bank Borrowings

1. Financial liabilities

- for bills discounted#

2. Other bank loans

- Current

- Non-current

463

6,484

4,229

2,718

387

5,959

3,877

2,469

19.6%

8.8%

9.1%

10.1%

300

7,805

4,950

3,155

54.3%

(16.9%)

(14.6%)

(13.9%)

Bank borrowings (1+2) 6,947 6,346 9.5% 8,105 (14.3%)

Trade payables - On hand - Under endorsed bills*

5,569

-

4,799

4

16.0%

(100%)

5,027

-

10.8%

0.0%

5,569 4,803 15.9% 5,027 10.8%

Bills payable 5,194 3,760 38.1% 5,195 0.0%

Total trade & bills payable 10,763 8,563 25.7% 10,222 5.3%

Net assets 16,991 15,446 10.0% 16,700 1.7% 6

Sep 16 Sep 15 Change Mar 16

Return on equity holders of the Company 10.9% 12.5% (1.6pp) 14.4%

Current ratio (times) 1.5 1.5 0.0% 1.5

AR turnover (days) - excluded bills receivables - with discounted bills - without discounted bills

53

109 105

55

112 109

(3.6%) -2.7% -3.7%

45

108 106

Inventory Turnover (days) - Total - Raw materials - Finished goods

67 26 41

53 18 34

26.4% 44.4% 20.6%

55 19 35

AP Turnover (included Bills Payables) (days) - with endorsed bills - without endorsed bills

121 121

104 104

16.3% 16.3%

106 106

Net Debt/Equity Ratio - Exclude discounted bills and foreign exchange hedging arrangements

Net Cash

Book value per share (HK dollars) 5.68 5.40 5.2% 5.68

7

China TV

46.2% (57.5%)

Overseas TV

22.2% (15.8%)

HK$20.3bn

3.8%

Digital Set-top box

14.5% (13.0%)

Group Revenue Breakdown by Products 1H2016/17 (1H2015/16)

* White Appliances are mainly refrigerators; washing machines and tablet PC

** Others included rental collection, property development, financial services, air conditioner, security systems, lighting products and other consumer electronic products

Others 11.8% (7.9%)**

White Appliances

5.3% (5.8%) *

8

Stable Gross Profit Margins

China TV: Stable margin by ramping up high-end mix to offset rising cost of

panel, more production automation and raise supply chain operational efficiency

Overseas TV: Growth driver, improving margin by mix and self-brands proportion

Digital STB (000810.SZ): Blended GPM 21.0%; No.1 profitability in China

White Appliances: Cost of raw materials trending up, expenses under control

with production base in Nanjing and leverage on TV distribution network

Group

1H2016/17 1H2015/16 Change 2015/16

20.6% 20.6% 0.0pp 21.9%

China Market Overall 24.2% 23.3% 0.9pp 23.9%

Overseas Market Overall 12.4% 10.9% 1.5pp 13.2%

TV (China) 24.5% 23.5% 1.0pp 24.8%

TV (Overseas) 9.8% 8.9% 0.9pp 10.1%

Set-top box (China) 17.6% 19.7% 2.1pp 20.1%

Set-top box (Overseas) 26.7% 20.8% 5.9pp 22.6%

White Appliances (refrigerator and washing machine)

22.6% 24.7% 2.1pp 27.6%

9

China TV

45.6% (65.3%)

Overseas TV

15.1% (6.0%)

HK$1,160m

11.7%

Digital Set-top box

22.8% (19.3%)

Others 6.2% (-2.1%)

White Appliances

1.3% (4.3%)

Segmental Profit Breakdown 1H2016/17 (1H2015/16) Diversification of Business to Sustain Growth

Property Holding

9.0%(7.2%)

10

Others

Property Holding

White Appliances

Digital STB

Overseas TV

China TV

Total

-29

95

56

254

79

858

1,313

73 (+351.7%)

104 (+9.5%)

15 (-73.2%)

264 (+3.9%)

175 (+121.5%)

529 (-38.3%)

1,160 (-11.7%)

(HK$m)

1H2016/17

1H2015/16

11

China TV: Higher operating expenses while ASP so revenue decline YoY

Overseas TV: Significant growth in scale

White Appliances: Included depreciation cost of $40m

Segmental Profit by Operating Segments

66%

25%9%

43%30% 27%

0%

20%

40%

60%

80%

100%

Smart TV (4K) Smart TV (Non 4K) Others

1H2016/17 1H2015/16

GP Margin 1H2016/17 1H2015/16 2015/16

Blended TV 24.5% 23.5% 24.8%

Smart TV (4K) 29.7% 32.5% 31.9%

Smart TV (Non 4K) 15.0% 19.7% 19.2%

Others 12.0% 13.2% 15.9%

% of China TV Sales

4K Smart TV 42% sales volume in 1H2016/17, 46% in Sep 2016 4K OLED HDR TV is the latest product

China TV Revenue Mix Upgrading to High-End Well Received Star Models Stablalising GP Margin

12

ASP 1H2016/17 1H2015/16 2015/16

Smart TV (4K) 3,324 4,433 4,197

Smart TV (Non 4K) 1,359 2,083 1,863

Others 1,012 1,730 1,499

1,712 1,961

2,712 2,979 3,121 3,114 3,051

2,577 2,404

2,123

0

1,000

2,000

3,000

4,000

07/08 08/09 09/10 10/11 11/12 12/13 13/14 14/15 15/16 1H16/17

ASP (HK$, net of tax and rebate)

China TV Blended ASP Lag Behind Panel Cost Fluctuations

Ramping Up New and Star Series Mix in 2H to Stabilize ASP

13

Other Electronic

Shops cover 3rd tier cities

to rural 34.6% (34.0%)

Large Scale Chain Stores

27.2% (30.0%)

Hypermarket 4.1% (3.7%)

Online 17.6%

(17.2%)

Others4.6% (3.1%)

Skyworth Community

Stores in major cities

10.1% (11.0%)

Commercial 1.8 (1.0%)

One layer from our 40 branches, 216 sales offices to 20,000+ retail customers

Other electronic shops and Skyworth community stores highest profitability

Large scale chain stores sustains market shares and brand building

China TV Revenue Breakdown 1H2016/17 (1H2015/16)

Nationwide Well Built Distribution Channels Strong in Rural

Ongoing Reforms to Enhance Customers Loyalty and Suit Diversified

Consumer Behaviors

14

15

O2O Community Stores Synergistic Partner with TMALL 3,060 located in Major Cities

Around 2,000 located in 3rd and 4th tier Cities

Strategic Retail Customers in 3rd 4th Tier Cities Flagship Stores 1,500 will be opened in the Rural

16

2016/17 TV Sales Volume

Targets: 4K Smart TV 44% Total Smart TV 79% of Mix

4K Smart TV reached 53% in January 2017

(’000 units)

2016/17 (Apr16 – Jan17)

2015/16 (Apr15 – Jan16)

Change%

2016/17

Target

Targeted YoY

Growth%

China TV comprises: 8,430 8,995 (6%) 11,000 9.6%

- Smart TV (4K) 3,851.0 2,474.1 56% 4,850 74%

- Smart TV (non-4K) 3,261.6 3,783.3 (14%) 3,850 (9%)

- Other Flat TV 1,317.6 2,737.7 (52%) 2,300 (23%)

Overseas TV 5,992 3,714 61% 6,000 36.1%

Total 14,422 12,709 13% 17,000 17.7%

Targeted volume achieved Apr 16-Jan 17: China TV 77% Overseas TV 100% Overall 85%

Target to maintain No.1 TV market share in China at 20% in 2016

17

2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 1H2015/16 1H2016/17

Total 3,696 3,270 3,906 4,162 5,019 6,685 2,535 2,934

China 2,676 1,953 1,898 2,297 2,876 3,990 1,716 1,851

Overseas 1,020 1,317 2,008 1,865 2,143 2,695 819 1,083

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

(Sales HK$ million)

Growth drivers in overseas markets, IPTV boxes in China, cable operators servicing streams, OTT box user data monetisation and VR gaming box

2015 sales volume : 69% cable operators digital boxes 25% retail OTT boxes

2015 No.1 market shares in both cable 15.7% and high definition cable boxes 16.7% in China (peers: 浪潮, 银河, 九联, 九洲, 海信)

2015 cable operators clients 406 in China, 85% were HD boxes

Overseas top 3 market share with Technicolor and Pace, sales in 95 countries and regions. Major overseas markets are Asia, Europe, India, Africa and South America

Source : Guideline Research 格蘭研究 (Mar 2016)

Digital Set Top Box 創維數字 (000810.SZ Spin-off Listed in Sep 2014)

No.1 China Cable Operators Market & Exporter, Top 3 in Global Market

Market Cap HK$20bn by Oct 2016, Skyworth holds 59.4%

18

24%

14%

44%

9% 9%

30%

6%

40%

4%

20%

0%

10%

20%

30%

40%

50%

60%

America Europe Asia Middle East Africa

% overseas sales 1H2016/17 1H2015/16

TV – Self-owned brands revenue 19.5%, ramping up to 50% by 2020

TV – Product mix is upgrading to 4K, smart and large size TV

Overseas Revenue Geographical Summary Skyworth Brand Entering Emerging and European Markets

TV Acquired Toshiba TV in ASEAN in early 2016

TV Acquired Sinoprima in Africa in 2014 & METZ in Germany in 2015

Set-top Box Acquired STRONG MEDIA in Europe in Sep 2015

19

20

Skyworth Metz OLED 4K HDR TV into European Market

Acquired Toshiba TV Plant in Indonesia to Expand in ASEAN Countries

Internationalization – Growth Driver

All TV (Volume) All TV (Revenue)

Rank Brand % Rank Brand %

1 Skyworth 17.7% 1 Skyworth 17.3%

2 Hisense 15.9% 2 Hisense 16.8%

3 TCL 13.6% 3 TCL 12.7%

4 Changhong 11.6% 4 Changhong 10.3%

5 Konka 11.3% 5 Samsung 9.9%

6 Haier 7.0% 6 Konka 9.0%

7 Philips 5.0% 7 Sharp 6.2%

8 Samsung 4.6% 8 Sony 4.4%

9 Sharp 3.4% 9 Haier 4.2%

10 PPTV 1.2% 10 Philips 3.4%

4K UHD TV (Volume) 4K UHD TV (Revenue)

1 Skyworth 20.9% 1 Skyworth 18.6%

2 Hisense 19.3% 2 Hisense 18.5%

3 TCL 15.5% 3 Samsung 12.9%

4 Changhong 12.3% 4 TCL 12.9%

5 Konka 10.3% 5 Changhong 10.2%

6 Samsung 7.3% 6 Konka 7.6%

7 Sharp 4.9% 7 Sharp 7.5%

8 Sony 2.9% 8 Sony 5.2%

Source: AVC Sep 2016 Offline Extrapolated sales data (1,505 cities; 6,700 retail terminals)

China TV Market Shares Oct 2015 – Sep 2016 (Domestic Brands 77%)

21

China TV sales volume Jan – Aug 2016 6.8% reached 30.5m units

National Day Holiday Oct 2016 average TV size 1.8” YoY reached 48.8”

50” 3% 55” 3.6% 65” 1.2% vs Labour Holiday May 2016

Mix 32”11% 39/40”12% 42/43”12% 48/49”12% 50”9% 55”31% 65” 6%

2016E 4K 47% Smart 84% 55”+ 31% HDR 7.9% S-Slim 3.6% Curved 4.7%

1H2016 market TV sales volume 6.9% revenue 4.0% YoY

1H2016 market shares: Traditional TV brands 75% Online brands 16% Foreign brands 9%

Consumers’ Considerations when buying a TV: 36% Trend 25% Brand 21% Design 19% Price 11% After-sales services

Source: AVC (July, Oct 2016)

TV Volume

(m units) 2012 2013 2014 2015 YoY 2016E YoY

Total 44.46 47.79 44.61 46.74 4.8% 50.56 7.1%

China Market TV Sales Volume Forecast

22

23

Skyworth & Internet Largest Smart TV Household Entrance with Self TV OS “coocaa”

Strategic Alliances with QIY, Tencent, Alibaba, iCNTV, Voole, JD

24

Internet TV installed since 2012 21.33m units Penetration 2016/17 85%

(Up to 31 Jan 2017) Conversion Rate

Smart TV Daily Active Users 7.86m 37%

Smart TV Weekly Active Users 9.91m 46%

Turn-on TV Ad Daily Exposure 18m times

Daily Duration spent on Content 192 min

Gaming Daily Active Users 640k 1m (1,000 games)

Skyworth Smart TV Users in China Additional 8m – 10m Smart TV Households Entrance in 2016

25

Advertising (RMB160bn market)

Gaming (RMB100bn market)

Education E-commerce:

Shopping/ Health Care/ Music/ KTV

Travel

Content

Apps Store

Monetisation of Smart TV Users on Opened Platform HK$50m in 2015/16 HK$100m in 2016/17

1H2016/17 Achieved Over HK$50m: 75% Content 22% Ad

Coocaa (non-profitable entity yet)

Invested by QIY in Sep 2016 Given RMB$3bn at Valuation

Best Hardware + Best Content + Smartest Memberships

Paid Users Numbers and Membership Renewal Rate

Increased Speedily in Sep and Oct 2016

TV Households Getting Used to Pay for Content

26

27

coocaa Total Users

Content Paid

Users

Total Content Revenue

2015 16m 600k RMB24m

2016E 24m 1.5m RMB60m

2017E 32m 3.5m RMB150m

(No. of episodes) Movie Drama Variety Shows

Cartoons Sports Document

ary MTV

Hollywood Movies

Cinema

QIY 10,000 3,000 1,500 2,500 90,000 45,000 60,000 3,000 2,000

Tencent 8,900 4,500 3,000 3,000 30,000 2,000 2,500 1,616 4,122

LeTV 1,393 875 1,102 812 1,013 338 1,047 735 200

Coocaa Alliances Top Tier Content Providers (QIY and Tencent) Offering the Best Experience to Skyworth Smart TV Users

28

Turn On TV Loading Ad

(Static ) 56%

Front Page Block Ad 12%

Others 8%

Turn On TV Content Ad

(Dynamic) 12%

Ad before or during Content

12%

Advertising on Big Panel Revenue Breakdown Coocaa Highest CPM in the Market

29

coocaa Online Education For different age segments

coocaa Travel Abundant demand in domestic

and global travel link up with content on TV

Top 5 Paid Education Apps

1. 果果乐园 2. 义方快乐学堂 3. 才智小天地 4. 百映生活学苑 5. 乐学名师课堂

30

coocaa Shopping coocaa Sports and Health

Gaming on Big Panel Alliances with Geek Box,

Ministation (Tencent)

Appendices

TV Technology Leader (32 - 33)

OLED 4K HDR TV in CES (34)

2015/16 TV Sales Volume (35)

Production Capacity and Chain Management (36)

Global OTT TV & Video Revenue Forecasts by Region (37)

LCD TV Replacement Demand in China (38)

New Digital STB Demand in China (39)

31

32

OLED + 4K HDR

AR TV – Gaming and Education Apps

TV Technology Leader

33

Globally First OLED 4K HDR TV from Skyworth

Partnering to Produce and Sponsor Singing Contest Program on Beijing TV

34

Skyworth OLED 4K HDR TV in CES Jan 2016

Global

Technology & Industrial Design Standards

2015/16 TV Sales Volume

4K Smart TV 28% Total Smart TV 70% of Mix

No.1 LCD TV market share in China 1.4pp at 21.4% in 2015

(‘000 units) 2015/16

2014/15

Change%

China TV comprises: 10,036 9,459 6%

- Smart TV (4K) 2,793.8 1,385.5 102%

- Smart TV (non-4K) 4,249.3 3,435.1 24%

- Other Flat TV 2,992.8 4,638.1 (35%)

Overseas TV 4,410 3,715 19%

Total 14,446 13,174 10%

35

Upstream supply chain management

Logistics investments in regional

logistic centers in Chengdu, Jiangxi and Nanjing

Strategic partnerships with LG Display, Innolux and BOE

Investments in panel (LGD 8.5G fab in Guangzhou), module production

Shiyan, Shenzhen 9m units

Guangzhou 4m units

Lishui, Nanjing 3m units

Inner Mongolia 1m units

TV Production Capacity 2016/17 (17m units )

Downstream inventory and logistics management

Vertical Integration and Chain Management

36

37 Source: Digital TV Research (Jul 2016)

Urbanisation

New Properties

Growth sustains, given 56% LCD TV penetration

rate (310m units installed) & increasing affordability

Urban CRT TV 77m remained

(1.6 TV /household)

TV Demand

• 75% Replacement • 15% More TV/ household • 10% New TV (properties • and new family) •

Source: AVC Ltd. TV (Jan 2016), Chinese Statistics Yearbook (State Statistics Bureau)

Rural CRT TV 126m remained

(1.2 TV /household)

Digitalisation

2015 - 20

Public Housing 5 - 7m units/ year built in 2012 - 14

LCD TV Replacement Demand in China >200m units CRT TV Remained at the end of 2015

LCD started in 2004 > 10 years old

38

39

59.21

68.35

75.2

83.01

92.16 92.03

40

60

80

100

2012 2013 2014 2015 2016E 2017E

(m Units)

2012-17 Digital STB Total Sales Volume in China

Source: Guideline Research 格蘭研究 (Mar 2016)

New Digital STB Demand

in China

Satellite STB

Potential households increase by 50m a year

Existing > 26.5m households penetration

Rural > 200m households to be covered

IPTV + OTT Box

Skyworth covered 26 provinces and 203 1st tier cities in 2015

Households grew 36% in 2015, reached 46m

Terrestrial STB

By 2015, digital terrestrial receiver has to built in all domestic TVs

ir@skyworth.com.hk http://investor.skyworth.com

Vision

To create a globally

prominent

brand of consumer

electronic products