Central Pattana Public : MD&A Q2/2022 30 June 2022

Central Pattana PLC

Management's Discussion and Analysis (MD&A)

Quarterly Financial Results: 2Q22

EXECUTIVE SUMMARY

In 2Q22, Thailand's domestic economy including the retail and tourism industries has shown a gradual recovery from 1Q22, underpinned by many supporting factors such as "back to new normal" lifestyles, easing COVID-19 measures, extending tourism-boosting campaigns by Government, and opening borders to welcome tourists. The number of international tourists thrice increased from the previous quarter, jumping from almost 0.5m in 1Q22 to 1.5m in 2Q22. However, various negative factors in 2Q22 have significantly impeded economic growth. The prolonged conflict between Russia and Ukraine, and China's Zero COVID-19 policy have caused higher energy prices as well as product and service costs, which in turn, negatively affected consumer confidence and spending power. The tight monetary policy carried by World's major Central Banks amid efforts to slow inflation has put global economic recovery on a brake. However, the Bank of Thailand tipped at a 0.25% potential interest rate hike at an appropriate time.

Given the situation, Central Pattana PLC ("The Company") recovered continuously from the previous quarter. In 2Q22, the Company showed total revenue of 9,151MB, and a net profit of 2,753MB, growing 13% and 18%QOQ respectively. Excluding the non-recurringitems and the impact of financial reporting standards, the Company's core performance showed total revenue of 8,961MB, and a net profit of 2,313MB, which increased by 9%, and 7%QOQ respectively. Every core business showed steady improvement, especially hotel, food center service, and residential for sale businesses which showed significant improvement. The Company continues to implement effective cost-saving initiatives which also help enhance its margin.

Our partner in the Dusit Central Park project, Dusit Thani PLC, exercised its call option to buy a 10% stake in our joint-venture company which resulted in a 345MB one-off profit before tax for the Company in this quarter. The Company's share in a joint-venture company remained at 30%.

In 2Q22, the Company's net retail leasable area (NLA) increased by 2%QOQ, from the latest opening of Central Chanthaburi in May and the renovation of Central Rama 2 to approximately 2.3m sqm with an average occupancy rate of 90%. Currently, the Company manages 56 shopping malls, consisting of 39 shopping malls and 17 community malls.

With the mission to be the leading retail-ledmixed-use developer, the Company announced an enthusiastic 5-yrs expansion plan of 37 hotels 4,000 keys, and 50 residential projects across Thailand.

The EGM of Siam Futures Development PLC ("SF") No. 1/2022 approved the delisting of its shares from the Stock Exchange of Thailand. Subsequently, the SET Board of Governors approved and delisted SF on June 1. The Company holds a total share of 99.73% of SF.

Responding to increased demand in storage from businesses and customers, the Company invested 30% in JWD Store it! Co., Ltd for a total investment of 93.86MB. Currently, JWD Store it! operates 6 branches with an NLA of 13,000sqm. Conforming to the strategy of expanding into a related industry that supports core business, the Company has partnered with an experienced leader in the storage industry to expand into the self-storage business.

Central Pattana Public Company Limited	1
Management's Discussion and Analysis (MD&A)

The Company has incessantly developed its excellence in sustainable development. Recently, the Company has issued 1,000MB 3-yr. Green Bond to fulfill a long-term plan of Net Zero Company by 2050. It is the first Green Bond in Thailand's property and retail industries.

OVERVIEW

The Company has 4 business units under management:

1. Rental and services
2. Food center services
3. Hotels, and
4. Residential for sale

Including properties transferred to CPN Retail Growth Leasehold REIT ("CPNREIT"), CPN Commercial Growth property fund ("CPNCG") as well as properties under the management of Grand Canal Land PLC ("GLAND") which is the Company's subsidiary.

Number of projects and net leasable/salable area under CPN management as of 2Q 2022

Type of business	Total	CPN	CPNREIT	CPNCG
No.	sq.m.	No.	sq.m.	No.	sq.m.	No.	sq.m.
Retail properties
Shopping malls - BMA	16	998,201	16	845,642	3	152,559
Shopping malls - Provinces	21	866,110	21	768,106	4	98,004
Community malls	17	169,124	17	169,124
Retail space in buildings		2,884		2,884
Total domestic retail properties	54	2,036,319	54	1,785,756	7	250,563
Shopping malls - International	1	84,081	1	84,081
Total retail properties	55	2,120,400	55	1,869,837	7	250,563
Non-core businesses
Office buildings	7	169,560	4	53,425	2	34,096	1	82,039
Hotels	2	563 rooms	1	259 rooms	1	304 rooms
Residential (high rise)	14	5,889 units	14	5,889 units
Residential (low rise)	6	928 units	6	928 units
Assets under GLAND
Office buildings	3	145,233	1	67,604	2	77,629
Residential (high rise)	1	1,991 units	1	1,991 units
Residential (low rise)	1	262 units	1	262 units
Retail space in buildings		20,342		20,342
Assets under SF
Shopping malls under JV	1	168,597	1	168,597

The Company manages 56 retail projects, of which 39 are shopping malls (16 in the Bangkok Metropolitan area, 21 upcountry, 1 overseas, and 1 joint-venture) as well as 17 community malls with a total NLA of 2.3m sqm. In 2Q22, the Company opened a new shopping mall, Central Chanthaburi, adding another 18,041sqm in NLA. Due to a major renovation of Central Ramindra, the Company's occupancy rate dropped slightly to 90%.

The Company has 10 office buildings for rent with a total of 314,792sqm. The occupancy rate was stable and strong at 91%.

Central Pattana Public Company Limited	2
Management's Discussion and Analysis (MD&A)

2 hotels under the Company's portfolio have 563 keys with 60% occupied during 2Q22, up from 49% in 1Q22, resulting from an influx of international tourists along with the domestic tourism stimulus package.

For the residential for sale business, the Company has a total of 22 residential projects in its portfolio. 14 of which are available for sale and transfer, comprising 7 high-rise projects that are mainly adjacent to the shopping centers and 7 low-rise projects that feature single-detached homes, semi-detached homes, townhomes, and home offices.

FINANCIAL PERFORMANCE

2Q22 Profit & Loss Statement reconciliation between F/S and core performance

Unit: MB*	Per	Non-	Core	TFRS16	Performance
F/S	recurring	performance	Impact	(excl.
		items			TFRS16)
Revenue from rental & services	7,552		7,552	155	7,707
Revenue from other businesses	1,024		1,024		1,024
Other income	575	(345)	230		230
Total Income	9,151	(345)	8,806	155	8,961
Cost of rental & services	3,804		3,804		3,804
Cost of other businesses	604		604		604
Administrative expense	1,492		1,492		1,492
Operating profit (loss)	3,251	(345)	2,906	155	3,061
(+)Share of profit from invested co.	384		384		384
(+)Investment income	381		381	(360)	21
(-)Interest expense	523		523		523
(-)Income tax	713	(69)	644	(40)	604
(-)Minority interest	26		26		26
Net profit to parent co.	2,753	(275)	2,478	(165)	2,313
*Numbers are decimally rounded

Non-recurring items

In 2Q22, the Company posted a one-off profit before tax of 345MB from a sale of a 10% investment portion in a joint-venture company "Vimarnsuriya Co., Ltd" to Dusit Thani PLC. per a previous agreement. The Company's share in a joint-venture company remained at 30%.

The impact of the implementation of new financial reporting standards on the Company's financial statement

From 2020, the Company has adopted the Thai Financial Reporting Standard (TFRS16) - Leases which impacted the financial statement in terms of differences from actual performance. An impact on the statement of comprehensive profit and loss in 2Q22 was as followed:

Central Pattana Public Company Limited	3
Management's Discussion and Analysis (MD&A)

• • The impact of the COVID-19situation According to relief measure by providing rent discount to tenants as forecast, impacted directly to rental and services revenue, which will be regularly recognized on a straight-line amortization basis through contract remaining period amounted to 155MB and 31MB of income tax expense on the rental revenue recognition. The transaction does not affect the Company's cash flow. (See details in the Notes to Financial Statements No. 2 "Impact of COVID-19 outbreak")
• Value adjustment to financial lease The Company recognized lease receivable from financial lease with CPNREIT in 1Q20 which reflects the present value at transaction date and will recognize receivable from financial lease until 2025 which will reflect the Company's cash flow that time. In 2Q22, the Company recognized an interest income from the Central Rama 2 lease contract amounted to 360MB and recorded its deferred tax of 72MB.

The following management discussion excludes an impact of non-recurringitems and the new accounting

standard (TFRS16)as mentioned above to the Company's best ability to reflect the financial performance based on actual business events, which may differ from the financial statements reviewed and/or audited by the auditors authorized by the Securities and Exchange Commission of Thailand (SEC).

Total Income

In 2Q22, the Company has a total income of 8,731MB, which increased 54%YOY and 10%QOQ from a steady improvement in all core businesses especially hotel, food center service, and residential for sale.

1. Rental & Service businesshas a revenue (excluding non-recurring items and TFRS16 effect) of 7,707MB, up 52%YOY and 7%QOQ on account of a 2% increase QOQ in NLA from the latest shopping malls - Central Chanthaburi, and a complete renovation of Central Rama 2. Followed better traffic and thrived tenant sales, discount support to tenants decreased slightly by 1%QOQ whilst rental income from revenue sharing part grew 15%QOQ. Lastly, office for rent revenue also grew 15%YOY and 2%QOQ from a higher average rental rate.
2. Food center servicesshowed revenue of 156MB, up 117%YOY and 31%QOQ as more tourists and office workers were back. The Company also added more variety and popular names to the centers, provided delivery service as well as increased marketing activities to attract more customers.
3. Hotel businessrecorded revenue of 203MB which jumped 332%YOY and 60%QOQ. Thanks to both international and domestic tourism, the average occupancy rate was driven up to 60% in 2Q22 with a strengthened average daily room rate and REVPAR.
4. Residential for sale businessreported revenue of 665MB, grew 43%YOY and 53%QOQ, from speedy construction progress, catching up with delayed transfer in low-rise and higher sales in high-rise projects

Gross profit

The Company showed a 2Q22 gross profit of 4,323MB, up 107%YOY and 12%QOQ. The gross margin was 50%, up from 37% a year earlier and 49% a previous quarter, owing to an increase in income more than that in cost. The Company maintains its efficient cost control amid rising operating cost conditions.

Central Pattana Public Company Limited	4
Management's Discussion and Analysis (MD&A)

Operating profit

2Q22 operating profit of 3,062MB jumped 196%YOY due to a significant reduction in SG&A/total revenue from 22% in 2Q21 to 16.7% in 2Q22. Therefore, the operating profit margin improved from 17% in 2Q21 to 34% currently.

Operating profit rose 9%QOQ with a QOQ stable margin as SG&A/total revenue grew slightly from 16.4% in 1Q22 to 16.7% in 2Q22, along with a 21%QOQ drop in other income which was mainly from a change in FX rate.

Net profit

The Company presented a 268%YOY and 7%QOQ growth in 2Q22 net profit of 2,313MB with a net margin of 25%. The Company received higher investment income and share of profit from an investment as recovery progressed, and so did an income tax expense.

(The following table is per reported financial statement)

Profit & Loss Statement (MB)*	2Q	1Q	2Q	YOY	QOQ
2021	2022	2022	%	%
Revenue from rent and services	5,396	7,097	7,552	40%	6%
Retail	5,100	6,761	7,210	41%	7%
Office	296	336	342	15%	2%
Revenue from hotel operations	47	127	203	332%	60%
Revenue from food center services	72	120	156	117%	31%
Revenue from real estate sales	466	435	665	43%	53%
Other income	383	293	575	50%	96%
Total revenue	6,364	8,072	9,151	44%	13%
Total revenue (excl. non-recurring items and TFRS16)	5,933	8,208	8,961	51%	9%
Cost of rent and services	3,152	3,626	3,804	21%	5%
Retail	3,070	3,547	3,719	21%	5%
Office	82	80	85	4%	7%
Cost of hotel operations	26	40	58	123%	45%
Cost of food center services	68	83	92	35%	11%
Cost of real estate sales	328	307	453	38%	48%
Total cost	3,574	4,056	4,407	23%	9%
Total cost (excl. non-recurring items and TFRS16)	3,574	4,056	4,407	23%	9%
Selling, general and admin expense	1,326	1,347	1,492	13%	11%
Operating profit	1,464	2,668	3,251	122%	22%
Operating profit (excl. non-recurring items and TFRS16)	1,033	2,804	3,062	196%	9%
Net finance cost/income tax/others	195	340	497	155%	46%
Net profit	1,269	2,328	2,753	117%	18%
Net profit (excl. non-recurring items and TFRS16)	629	2,158	2,313	268%	7%
Earnings per share (THB)	0.28	0.52	0.62	117%	18%
Earnings per share (excl. non-recurring items and TFRS16)	0.14	0.48	0.52	268%	7%
*Numbers are decimally rounded

1H	1H	YOY
2021	2022	%
11,360	14,649	29%
10,740	13,971	30%
620	678	9%
114	330	189%
166	276	66%
851	1,100	29%
3,401	868	(74%)
15,892	17,222	8%
12,581	17,168	36%
6,327	7,431	17%
6,163	7,266	18%
164	165	0%
53	98	85%
139	174	25%
584	760	30%
7,104	8,463	19%
7,104	8,463	19%
2,590	2,840	10%
6,198	5,920	(4%)
2,887	5,867	103%
1,095	838	(23%)
5,103	5,082	(0%)
1,885	4,471	137%
1.14	1.14	0%
0.42	1.00	169%

Central Pattana Public Company Limited	5
Management's Discussion and Analysis (MD&A)