Central Pattana : Annual Report 2023 (56-1 One Report)

Imagining

Better Futures

For All

Annual Report

2023

(56-1 One Report)

No.1 Real Estate Developer in Sustainability Globally.

Contents

4	Message from
	the Board of Directors
8	Report of the Audit and
Corporate Governance Committee
11	Report of the Nomination
and Remuneration Committee
13	Report of the Risk Policy
Committee
14	Financial Highlights
16	Board of Directors
18	Management Team

01

Business and Operating Performance

01	Business Structure and Operating Performance
1.1	Business Policy and Business Overview	20
1.2	Nature of Business	38
1.3	Investment Structure	60
1.4	Authorized Share Capital and Paid-up	74
	Share Capital
1.5	Other Securities (Debenture)	74
1.6	Dividend Policy	75
02	Risk Management
2.1	Risk Management Policy and Plan	76
2.2	Risk Factors Affecting Business Operations	78
03	Sustainable Development
3.1	Materiality Issue and Strategy	87
3.2	Sustainable Management for Stakeholder,	104
	Social and Environment
04	Management Discussion and Analysis
4.1	Analysis at Business and Financial Performance	181
4.2	Significant Factors that may Impact Future	187
	Business and Financial Performance
4.3	Financial Highlights	190
05	General Information and Other Information
5.1	General Information and Reference Persons	194
5.2	Other Information	195
5.3	Legal Dispute	197
5.4	Secondary Market	197
5.5	Financial Institution for Debenture	197

02

Corporate Governance

06 Corporate Governance Policy

6.1	General Policy and Corporate Governance	198
	Practice
6.2	Code of Business Ethics	199	Financial Report	Click
6.3	Key Development of Policy and Corporate	200	03
	Governance in the Year		Attachment
07 Corporate Governance Structure and		Attachment 1	Click
	Information of Board of Directors,		Profiles of Board, Management, Controlling Persons
	Sub-committee, Management,
		and Company Secretary
	Employees and Others
7.1	Corporate Governance Structure Chart	212	Attachment 2	Click
7.2	Board of Directors	214
List of Committee in Subsidiaries
7.3	Sub-committees	222
7.4	Management	226
7.5	Employees	229	Attachment 3	Click
7.6	Other Information	230	Profile of Head of Internal Audit
08	Corporate Governance Report		Attachment 4	Click
8.1	Summary of Board of Directors Performance	231
Assets under Central Pattana
8.2	Summary of Audit Committee Performance	246
8.3	Summary of Other Sub-committee	246	Attachment 5	Click
	Performance
		Code of Conduct and Corporate Governance
09 Internal Control and Connected Transaction	Principles Handbook and Charters
9.1	Internal Control	247	Attachment 6	Click
9.2	Connected Transaction	250
Report of the Audit and Corporate Governance
External Assurance Statement	256	Committee

4	Message from the Board of Directors

Message from the Board of Directors

Dear Shareholders

In 2023, Central Pattana delivered exceptional growth in financial performance across every business, mainly driven by the retail business which was in line with growing tenants' sales. Our tenants saw their sales fully recovered to pre-Covid level since late 2022, and the growth still persisted especially in the malls with higher foreign tourist footfall traffic. The continued recovery of foreign tourists also led to robust domestic consumption in Thailand during 2023.

Message from the Board of Directors	5

Although there were growing concerns regarding slowdown in Thai economy and household debt, the Company's retail business delivered strong performance thanks to the Retail-Led

Mixed-UseDevelopment strategy which created a complete ecosystem in each project.

Furthermore, Central Pattana's holistic partnership solution for tenants also resulted in growing tenants' sales which led to our growing retail rental revenues as well as collective effort on cost control without compromising on service quality. In addition, the transfer of condominiums from our residential business was also another important driver of the Company's performance in the second half of the year. All in all, Central Pattana reported all-time-high revenues of Baht 46,790 mn and net profit of Baht 15,062 mn, increased by 26% and 40% from the previous year, respectively, in 2023.

Apart from solid revenue growth, the Company's operating profit margin also improved thanks to enhanced operational efficiency, ongoing effective cost control measures, and most importantly improved energy efficiency and green energy consumption as part of the ESG strategy. Moreover, the Company's net interest-bearing debt to equity trended lower implying stronger financial position. This will lead to greater capability to develop new projects and expand existing projects to complete the ecosystem, which will reinforce our position as the top-of-mind destinations for tenants and shoppers.

Strengthened leadership position through Retail-LedMixed-Use Project

Central Pattana launched 5 new hotels and 5 new residential projects during 2023, which was the highest number of non-retail projects launch to complete the mixed-use project. The Retail-LedMixed-Use strategy has proven to be fruitful, as hotels and residential projects completed other elements to the retail and overall project. As a result,

the project can offer a completed lifestyle solution to customers (shop-eat-work-play-stay-live), leading to higher traffic and tenants' sales. Following the opening of hotels in Central Ubon and Central A y u t t h a y a , t h e C o m p a n y a d d e d 2 m o r e fully-integratedmixed-use in upcountry after the first one at Central Korat in the previous year.

6	Message from the Board of Directors

Successful opening of Central Westville, the new landmark in the West of Bangkok

In November 2023, the opening of Central Westville was well-received and the mall has become the popular destination in the West of Bangkok. This new project reflected the Company's vision to elevate the quality of neighborhood, community, people, and environment. Central Westville is the low carbon mall,

which is in line with Central Pattana's ESG strategy to reduce greenhouse gas with semi-outdoor concept and green space. The mall addressed the holistic needs of people, pets, and the planet and the Company's pathway to net zero Carbon, which led to high opening occupancy and rental rate.

"Imagining Success Together" growing sales through partnership with tenants. Top-of-mind location for global brands

The Company is committed to grow our business with tenants' and partners' and aims to provide end-to-end solution for tenants. The Partner Champion teams are working their best to offer insights for our partners, from existing partners to global brands that want to enter Thailand. The teams are also working closely with The 1, which is the largest loyalty program in Thailand with more than 20 million members, to create best-in-class CRM Program. Through

The 1 and The 1 Biz program, tenants will be able to personalize marketing message to customers and better customize to consumers' needs. Customers can also earn and redeem The 1 points with tenants in Central Pattana's malls who participating in the program. By leveraging on The 1 and our nationwide network of more than 40 malls, tenants can scale up easier with Central Pattana.

Ongoing asset enhancement and renovation programs leading to sustainable performance and asset value

The Company completed the redevelopment of Central Ramindra, which is Central Pattana's second shopping mall (operated since 1993), in the beginning of 2023. The redevelopment has transformed Central Ramindra into the new best landmark in the growing community as a result of the strategic ring extension from the linkage of the MRT Green Line and Pink Line, which brought additional crowd from Ladprao and Paholyothin to Ramindra. In addition, the completion

of Central Westgate renovation also added net leasable area of approximately 10,000 sq.m, parking space, and community space, offering more completed solution to customers' lifestyles. The Company have ongoing plan for asset enhancement and renovation in 2024 to adapt to changing lifestyle and becoming better lifestyle destinations, including the shopping malls under CPNREIT as well to deliver sustainable return to unitholders.

Message from the Board of Directors	7

World-class sustainable organization, ranking World's No. 1 in DJSI World among leading 299 property developers globally

Last but not least, the Company remained focus on the impact from our operation to environment as a pathway to Net Zero carbon by 2050. Our actions include reducing energy consumption, installation of solar rooftop, installation of EV charging stations, building green space, and improving waste management. This is not only good for environment, but also enhanced operating efficiency and profitability. The Company maintained its position in the DJSI Emerging Markets for the 10th consecutive year, and remained a member of the S&P Global Sustainability Yearbook for the 6th consecutive year. More importantly, we achieved the highest score and ranked 1 s t according to S&P Global's sustainability ranking, or Top 1% S&P Global CSA Score.

After the strong recovery from Covid-19, the successful opening of new projects and strong operating performance in 2023 reflected our commitment to create center of life for community and region. On behalf of the Board of Directors, we would like to thank all stakeholders - shareholders, customers, tenants, financial institutions, medias, relevant public and private sector, and employees for continuous trust and support for Central Pattana. Central Pattana will continue to conduct our business with good corporate governance along with social, communal and environmental responsibilities for the best benefit of all stakeholders. We hope for all stakeholders' continuing trust and support for future sustainable growth of stakeholders along with Central Pattana.

Mr. Sudhitham Chirathivat

Chairman

Ms. Wallaya Chirathivat

President and Chief Executive Officer

8	Report of the Audit and Corporate Governance Committee

Report of the Audit and

Corporate Governance Committee

Dear Shareholders,

The Audit and Corporate Governance Committee comprises three professional independent directors, all qualified according to the Company's criteria. Mr. Winid Silamongkol, who is knowledgeable and duly experienced in auditing financial statements, serves as the Chairman of the Audit and Corporate Governance Committee. Mrs. Jotika Savanananda and Ms. Parnsiree Amatayakul act as members of the Audit and Corporate Governance Committee.

In 2023, there were a total of nine meetings of the Audit and Corporate Governance Committee, where the committee members attended all meetings and consulted with the management, the internal and the external auditors on related matters, as well as obtaining data from the management on related items in the agendas, completely according to the duties and

responsibilities as specified in the Charter of the Audit and Corporate Governance Committee. The committee could freely provide opinions and suggestions as appropriate. The Audit and Corporate Governance Committee reported the operating performance to the meeting of the Board of Directors in seven meetings, with important details of the operating performance and opinions on various matters as follows:

Accuracy, Completeness,

and Credibility of Financial Reports

The Committee reviewed quarter and annual financial statements, as well as important accounting policies in compliance with financial reporting standards, in line with important audit issues specified in the reports of external auditors. The Committee also considered the scopes, audit methods, and issues in consultation with the management and the auditors. Two non-executive meetings were arranged with the auditors to discuss the matter of independence in the execution of duties. In 2023, the auditors found no significant matters of concerns. Moreover, the Committee also encouraged the Company to study the preparation of sustainability reports according to the international IFRS S1 and IFRS S2 standards before the enforcement in Thailand and as a matter of concern among foreign investors.

The Audit and Corporate Governance Committee had opinions that the Company's financial reports were prepared under the financial report standards specified by the Federation of Accounting Professions, with accurate, complete, reliable, as well as sensible and reasonable use of accounting policies.

Report of the Audit and Corporate Governance Committee

Adequacy of Internal Control System, Internal Audit, and Risk Management

The Audit and Corporate Governance Committee reviewed audit reports of the Internal Audit Office and the auditors on the assessment of internal control system to ensure that the Company had a comprehensive risk management and risk evaluation which covered all dimensions, including the plans and guidelines of risk management which affected the Company's operating performance. This especially comprised cyber risk management under good information technology governance.

The Audit and Corporate Governance Committee supported the role of the Internal Audit Office in helping the Company create a good internal control system other than working assurance. In addition, the Internal Audit Office performed consulting projects in the main departments and set up public relations media for personnel to understand and recognize the importance of adherence to the internal control system by collaborating with various units in preparing media through different channels, as well as regular reporting on complaint management to the Audit and Corporate Governance Committee.

The Audit and Corporate Governance Committee had opinions that the Company's internal control system was adequate and appropriate, with risk management in compliance with the COSO Framework of internal control.

The Audit and Corporate Governance Committee reviewed and approved the annual strategic and internal audit plans according to the risk-based criteria and data from the executives. The integrated audit (IT and non-IT) was applied to cover all aspects of risks and controls. The Audit and Corporate Governance Committee always held meetings with the executives of the Internal Audit Office, without the management team. Also, the Internal Audit Office was encouraged to develop more IT audit personnel, in line with the implementation of technological tools to assist in the work of internal audit toward the Company's growth in an era driven by technology.

9

Moreover, the Audit and Corporate Governance Committee evaluated the quality of the annual internal audit with the result of "good." In 2023, there was an assessment on the quality of internal audit work by external evaluators, which must be done every 5 years. The Internal Audit Office has applied overall suggestions to improve its working standards in compliance with international principles and good practices. Thus, the Audit and Corporate Governance Committee viewed that the Internal Audit Office has undertaken its duties in accordance with international standards.

Good Corporate Governance

The Audit and Corporate Governance Committee performed their duties and responsibilities in compliance with the Corporate Governance Code (CG Code). In 2023, there was a review on the Corporate Governance practices among the listed Thai companies by emphasizing the implementation of anti-corruption measures to cover the entire group of companies, in line with the recommendation on sustainable business operations according to DJSI and the environmental activities to achieve the Net Zero Plan as specified.

Compliance with Securities and Exchange Laws, the Stock Exchange of Thailand's Requirements, and Applicable Laws

The Audit and Corporate Governance Committee reviewed the compliance with securities and exchange laws, requirements of the Stock Exchange of Thailand (SET), and applicable laws related to the Company's business, and regularly monitored the improvement and remedial approaches of the management, while overseeing the revision of the Code of Conduct and the Corporate Governance Policy, including ethics and policies, in line with the new and international standards. The management was assigned to review the Company's performance to ensure its compliance with the CG Code. The Audit and Corporate Governance Committee had opinions that the Company has complied with securities and exchange laws, requirements of the SET, and applicable laws related to the Company's business, including Personal Data Protection Act B.E. 2562 (2019).

10	Report of the Audit and Corporate Governance Committee

List of Acquisition or Disposal of Assets with Significant Value, Related Party Transactions and Transactions with Potential Conflicts of Interest

The Audit and Corporate Governance Committee recognizes the importance of the list of acquisition or disposal of assets with significant value, related party transactions, and transactions with potential conflicts of interest according to the laws and regulations of the SET. Also, it emphasizes that all of the involved parties must comply with the stipulated policies. Meanwhile, the auditors must monitor and verify all of those transactions annually.

In 2023, the Company had no significant list of acquisition or disposal of assets with significant value, related party transactions, and transactions with potential conflicts of interest to be disclosed in compliance with the laws and regulations of the SET.

Suitability of Auditors - Review, Selection, and Nomination of Auditors

The Audit and Corporate Governance Committee reviewed the independence and operating performance of 2023. The overall performance was at the level of "good" with adequate independence according to the code of accounting professionals. The Audit and Corporate Governance Committee held two meetings with auditors without the management for comments from auditors on the audit performance and problems in working with the relevant management team.

For the appointment and nomination of auditors in 2024, the Audit and Corporate Governance Committee considered the operating performance, scope, and amount of work

compared with the proposed audit fees for the year 2024. It is approved to present to the Board of Directors for nomination of KPMG Phoomchai Audit Ltd. as the auditor to provide opinions on the Company and its subsidiaries' consolidated financial statements for the year 2024 and approve the audit fees not exceeding Baht 3,400,000 for the year 2024, and acknowledged the audit fees for its subsidiaries established and registered inside the country and overseas, which are audited by KPMG Thailand, KPMG overseas, and other auditors, not exceeding Baht 7,784,400.

Overall Opinions and Notes on the Performance According to the Charter of Audit and Corporate Governance Committee

The Audit and Corporate Governance Committee evaluated and summarized its overall performance for 2023 on January 18, 2024. The performance evaluation form was divided into three parts: Part 1 Overall performance, Part 2 Specific performance, and Part 3 Performance on good corporate governance.

The Audit and Corporate Governance Committee had the overall opinion that it has performed duties and responsibilities according to the Charter of Audit and Corporate Governance Committee approved by the Board of Directors with sufficiency, completeness, competence, caution, and independence for all stakeholders' equitable interests, while emphasizing the Company's sustainable development according to good corporate governance principles.

Mr. Winid Silamongkol

Chairman of the Audit and

Corporate Governance Committee