Techtronic Industries : ANNOUNCEMENT OF RESULTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017

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TECHTRONIC INDUSTRIES CO. LTD.

創 科 實 業 有 限 公 司

(Incorporated in Hong Kong with limited liability)

(Stock Code: 669) ANNOUNCEMENT OF RESULTS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2017 HIGHLIGHTS 2017 2016 US$' million

US$'

million

Changes % Revenue 2,882 2,686 +7.3 Gross profit margin 36.6% 36.1% +50 bps EBIT 233 201 +15.4 Profit attributable to Owners of the Company 204 177 +15.5 EPS (US cents) 11.17 9.69 +15.3 Interim dividend per share (approx. US cents) 3.57 2.57 +38.8

• Revenue increased 7.3% to a record US$2.9 billion
• Revenue adjusted for foreign currency grew 8.1%
• MILWAUKEE continues with strong momentum, growing 20.1% adjusted for currency
• RYOBI brand business delivered double-digit revenue growth
• Gross margin improved 50 basis points to 36.6%
• Net profit increased 15.5%, delivering double-digit growth for eight consecutive first half periods

The board of directors (the "Directors" or the "Board") of Techtronic Industries Company Limited ("TTI" or the "Company") is pleased to announce the unaudited consolidated results of the Company and its subsidiaries (together, the "Group") for the six-month period ended June 30, 2017 together with the comparative figures in 2016.

INTERIM DIVIDEND

The Directors have resolved to declare an interim dividend of HK27.75 cents (approximately US3.57 cents) (2016: HK20.00 cents (approximately US2.57 cents)) per share for the six-month period ended June 30, 2017. The interim dividend will be paid to shareholders listed on the register of members of the Company on September 8, 2017. It is expected that the interim dividend will be paid on or about September 22, 2017.

MANAGEMENT'S DISCUSSION AND ANALYSIS Record Performance

TTI delivered another set of record results in the first half of 2017 on strong revenue growth and excellent operational productivity. Revenue, gross profit and net income all reached record levels for the period. Revenues grew 7.3% to US$2.9 billion and 8.1% before currency adjustment. Net profit margins improved by 50 basis points to 7.1% of sales, compared to 6.6% in the first half of 2016. Before currency adjustments, all geographic regions reported revenue growth. TTI continues to drive growth by launching leadership cordless products and through highly successful geographic expansion initiatives.

The Power Equipment segment outpaced the power tool industry with double-digit sales growth of 11.9% and 12.5% before currency adjustment. The MILWAUKEE industrial business again produced outstanding sales growth of 20.1% before currency adjustment. The Consumer Power Tool and Outdoor Product businesses delivered robust growth driven by the industry leading RYOBI ONE+ cordless system. The Floor Care and Appliances segment had a sales decline of 13.8% or 12.1% before currency adjustment, but made progress in revitalizing the product range.

TTI reported its ninth consecutive period of gross margin improvement with a 50 basis point increase in gross margin to 36.6% for the period. The gains are being generated by positive margin contributions from the new product stream as well as lean manufacturing and automation, global purchasing programs, and ongoing initiatives to boost supply chain efficiency. SG&A for the first half of 2017 remained at the same 28.7% of sales as last year. TTI continued the strategic investments in new product development, targeted geographic expansion, and marketing. These initiatives generated increased earnings before interest and taxes by 15.4% to US$233 million, net profit attributable to shareholders of US$204 million, which is a 15.5% increase from the prior year, and basic earnings per share increase of 15.3% to 11.17 US cents.

BUSINESS REVIEW Power Equipment, Accessories and Hand Tools

The Power Equipment business, the largest segment accounting for 85.6% of total sales, delivered a strong first half with US$2.5 billion in global sales, representing an 11.9% increase compared with the same period in 2016. The growth was bolstered by the flow of new product introductions, strong account partnerships, geographic expansion, and focused end-user marketing. The EBIT increased 25.6% for the business in the first half of the year.

Industrial Tools

In the first half of 2017, the MILWAUKEE industrial business reported impressive results with world-wide sales growing by 20.1% in local currency. The effective execution of both distribution and end user conversion initiatives, introduction of innovative new products, and entry into large adjacent categories resulted in growth which outperformed the market.

Power Tools

The MILWAUKEE Power Tool business reported another period of double-digit sales growth with market share gains and category expansion. The M18 system is the fastest-growing cordless system for the professional end user, which will have over 135 compatible tool solutions on a single battery platform by year-end. MILWAUKEE is the leader in the global sub-compact cordless space, with the M12 cordless system offering over 80 compatible tools.

The MILWAUKEE FUEL technology leverages high-performance brushless motor technology, system electronics, and REDLITHIUM battery technology with sustained performance capable of replacing the need for cords. MILWAUKEE remains focused on developing new and innovative products integrating FUEL technology and currently offers over 55 M18 FUEL cordless power tools. The highly successful FUEL range was further expanded by the introduction of the M18 FUEL Outdoor Power Equipment range. The game changing performance of FUEL is converting users of traditional corded, pneumatic, and gas-powered tools and outdoor products to the MILWAUKEE M18 and M12 cordless systems.

The FORCELOGIC platform which replaces traditional corded, gas, and hydraulic tools continues to exceed end user expectations with the recent introduction of M18 FORCELOGIC 1590 ACSR Cable Cutter, M18 FORCELOGIC 12 Ton Crimper and the innovative M18 FORCE LOGIC 3" Underground Cable Cutter. The successful MILWAUKEE High Output LED Lighting family, powered by the M12 and M18 cordless systems, continues to grow with innovations which utilize the most-advanced LED technology and incorporating versatile product designs.

Accessories

The MILWAUKEE Power Tool Accessory business delivered strong growth in the first half. The SHOCKWAVE line of driver bits and drill bits continues to grow globally through product line expansion tailored to regional needs and from the growth of cordless impact drivers. A new high performance SAWZALL reciprocating blade line up, THE AX with Carbide Teeth offers extreme life and versatility for wood and multi-purpose demolition jobs. Growth will continue to accelerate with the launch of the TORCH with Carbide Teeth for the toughest metal cutting applications.

Hand Tools

The Hand Tool business expansion continues. The successful MILWAUKEE Tape Measure range was upgraded with user benefits including reduced overall size, higher blade durability, and optimized hook design. Additions to the layout category include chalk reels that feature STRIPGUARD clutch technology to protect the planetary gear system from damage. The 18" and 24" Jobsite Rolling Bags have been added to the MILWAUKEE storage solutions which features 6" all-terrain wheels and 1680D ballistic material. MILWAUKEE continues to expand into new categories, such as framing hammers with SHOCKSHIELD grips that provide best-in-class grip durability and vibration reduction.

The EMPIRE brand business maintained strong growth with new product introductions and retail conversions in targeted sales channels. EMPIRE launched a series of digital levels with the first-ever auto-calibrate feature making it simple and easy to use and includes the industry's largest LCD screen, an audio indication feature, and IP67 rating for working in the toughest construction environments. Building on the successful launch of ULTRAVIEW, EMPIRE introduced the em95.10 ULTRAVIEW LED Torpedo level for best vial viewing in any light condition. This addition to the line is driving the lighted level category to take significant market share.

Consumer and Professional Tools

In the first half, the Consumer and Professional Tools business continued the sales growth momentum with the exciting flow of innovative products focusing on the construction and home improvement segments of the market. Marketing campaigns tied with end user relationship programs such as RYOBI Nation in North America continued to strengthen loyalty bonds with consumers and professionals alike, invigorating Ryobi's market leading position.

Sales of the RYOBI ONE+ 18V cordless system grew double digit by expanding the product range with technology advancements in brushless tools and LED lighting. Along with the powerful next generation brushless drills, the RYOBI brand launched the first-to-market cordless brushless belt sander. The range additions of the brushless 7 ¼" circular saw, brushless 5" angle grinder, trim router and belt sander brought the RYOBI ONE+ system to over 100 integrated tools. The RYOBI brand is leading the home improvement industry in lithium ion battery technology.

Sales for the professional trade AEG brand power tools were up led by the AEG 18V system expansion and excellent growth in AEG accessories. The AEG impact-rated bits saw significant market acceptance establishing a platform for future growth. Partnerships with leading retailers are providing the distribution footprint as the business continues supporting new product development and investment in marketing initiatives aimed at the professional trade user.