27 MARCH 2019

HONG KONG TELEVISION NETWORK LIMITED

(SEHK: 1137)

Annual Results Presentation

for the year ended31 December 2018

Disclaimer This presentation and subsequent discussions may contain forward-looking statements and information that involve risks,uncertainties and assumptions. Forward-looking statements are all statements that concern plans, objectives, goals, strategies,future events or performance and underlying assumptions and other statements that are other than statements of historical fact,including, but not limited to, those that are identified by the use of words such as "anticipates,'' "believes,'' "estimates,'' "expects,''"intends,'' "plans,'' "predicts,'' "projects'‘, “target” and similar expressions.

The information included is solely for the use in this presentation and certain information has not been independently verified. Norepresentations or warranties, expressed or implied, are made as to, and no reliance should be placed on, the fairness, accuracy,completeness or correctness of the information or opinions presented or contained in this presentation. The performance and theresults of operations of the Group contained within this presentation are historical in nature, and past performance is no guaranteeof the future results of the Group. Any forward-looking statements and opinions contained within this presentation are based oncurrent plans, estimates and projections, and therefore involve risks and uncertainties. Actual results may differ materially fromexpectations discussed in such forward-looking statements and opinions.

Certain information in this presentation is extracted from Google Analytics and rounded to the nearest thousand. The computationmethod and basis of which have not been verified. The data could be overlapping (a) between different type of devices OnlineShopping Platform if the same user using more than one devices for browsing our Online Shopping Platform at the same time; (b)or the same user using HKTVmall app to browse the HKTVmall web-page; (c) if the same user using the same device to browsethe online shopping mall through different channels/medias on the same device. The information for the same period can bechanged at different point of time when capturing the data as Google Analytics performs the analysis on sampling basis. Accordingto Google Analytics, the definition of “User” is “Users that have had at least one session within the selected date range, whichincludes both new and returning users.” The above data are unaudited and are not indicative of the Company’s businessperformance, financial condition or growth prospect. Readers should not place reliance on these data.

For figures generated from internal systems and relevant platforms, which were rounded up to nearest integral percentage orthousand, are unaudited and for reference only.

We are not required to correct or update any such statement or information to either reflect events or circumstances that occurafter the date the statement or information is made or to account for unanticipated events or otherwise.

2

3

� Operational and Financial Review By Ms. Alice Wong, CFO

� Business Review and Outlook By Mr. Ricky Wong, Chairman

� Q & A

Agenda

� Operational and Financial Review By Ms. Alice Wong, CFO

Source: GMV and Average Daily Order (including all online and offline platforms) – Internal platform and system

Gross Merchandise Value (“GMV”) on order intake represents the total gross sales dollar value for merchandise sold through a particular marketplace over a certain timeframe, before deduction of any discounts offered by the marketplace, rebate used, cancellation and returns of merchandise sold.

Increasing Demand – Online + Offline @ average order value ~ HK$500

5

0

Sustainable Growth Momentum

Remark:

Gross Merchandise Value (“GMV”) on order intake represents the total gross sales dollar value for merchandise sold through a particular marketplace over a certain timeframe, before deduction of any discounts offered by the marketplace, rebate used, cancellation and returns of merchandise sold.

6

336.3 187.1

1,070.4

487.3

1,891.3

896.4

-

500

1,000

1,500

2,000

2,500

GMV on order intake Turnover

HK$mn 2016 2017 2018

77%

84%

Consolidated Income Statement

7

Year ended Year ended

31 December 2018 31 December 2017

HK$'000 HK$'000 HK$'000 %

GMV on Order Intake 1,891,256 1,070,359 820,897 77%

Turnover

- Ecommerce 883,247 485,229 398,018 82%

- Multimedia 13,127 2,028 11,099 547%

Total Turnover 896,374 487,257 409,117 84%

Cost of inventories (538,752) (295,178) (243,574) 83%Other operating expenses (737,567) (568,555) (169,012) 30%

Valutaion gain 43,550 80,500 (36,950) -46%

Gain on disposal of a subsidiary 161,645 -

Other income, net 46,913 94,230 (47,317) -50%

Finance costs (4,921) (2,011) (2,910) 145%

Income tax expense (337) (1,163) 825 -71%

Loss attributable to shareholders (133,095) (204,920) 71,825 -35%

Interest on bank loans 4,718 1,778 2,940 165%

Income tax expenses/(credit) 337 1,163 (825) -71%

Investment returns (41,988) (55,022) 13,034 -24%

Gain on disposal of a subsidiary (161,645) -

Depreciation 67,464 46,775 20,689 44%

Amortisation 24,016 15,060 8,956 59%

EBITDA loss (240,192) (195,166) (45,027) 23%

Marjory non-cash items (31,254) (70,396) 39,142 -56%

- Valuation gains on investment properties (43,550) (80,500) 36,950 -46%

- Exchange gain/(loss) 2,932 (18,701) 21,633 -116%

- Reversal of expected credit loss on debt securities measured at FVOCI (224) - (224) 0%

- Non-cash licensing income (10,174) - (10,174) 0%

- Equity-settled share-based transactions 7,188 28,805 (21,617) -75%

- Unrealised fair value loss on debt securities measured at FVPL 12,574 - 12,574 0%

Adjusted EBITDA loss (271,446) (265,562) (5,885) 2%

Variance

Key Highlight on Consolidated Income Statement

8

Adjusted EBITDA Loss of HK$271.4mn in 2018 vs. HK$265.6mn in 2017;Net Loss of HK$133.1mn in 2018 vs. HK$204.9mn in 2017.

Relative to 2017,

1. Turnover increased by HK$409.1mn to HK$896.4mn in 2018, a remarkable growth of 84% wasachieved;

2. Operating Expenses increased by HK$169.0mn to HK$737.6mn in 2018 to cope with business growth and order fulfillment. Increase mainly caused by logistic and warehouse operating costs, talent costs, advertising and marketing expenses and non-cash depreciation and amortisationcharges;

3. Valuation Gain on Investment Properties decreased by HK$36.9mn to HK$43.5mn in 2018;

4. Other Income, net decreased by HK$47.3mn to HK$46.9mn mainly caused by reducedinvestment income due to realization of investment for operating and capital expenditure,decreased exchange gain of HK$18.7mn in 2017 to loss of HK$2.9mn in 2018, and unrealisedfair value loss of HK$12.6mn due to the initial adoption of HKFRS 9;

On Completed Orders and Adjusted Basis2018

HK$’0002017

HK$’000

Direct merchandise salesGMV on completed orders1,2 715,093 381,126Cost of Inventories (538,752) (295,178)Gross profit 176,341 85,948Gross margin % 24.7% 22.6%

Income from concessionaire sales and other service income

GMV on completed orders1 1,118,970 649,766Merchant payments (net off by other service income) (918,582) (516,918)Income from concessionaire sales and other service income3 200,388 132,848Blended commission rate 17.9% 20.4%

Growing Revenue and Margin – Direct Merchandise Sales and Concessionaire Sales

Remark:

1. GMV on completed orders represents the total gross sales dollar value for merchandise sold through a particular marketplace and the customer has obtained control of the promised goods and services ordered over a certain time frame, after deduction of any discounts offered by the marketplace, cancellation and returns of merchandise, and is before the deduction of HKTVmall Dollars and promotional coupon which is considered as advertising and marketing expenses under management reporting purpose.

2. For Direct merchandise sales, the GMV on completed order is before the deduction of HKTVmall Dollars and use of promotional coupon of HK$29,204,000 (2017: HK$34,953,000).3. For Income from concessionaire sales and other service income, it is before the deduction of net HKTVmall Dollars of HK$3,030,000 (2017: addition of HK$6,208,000).

Lower blended commission rate in 2018 was mainly due to increase in GMV contribution from Electronics (by 172.7% versus 2017) which usually has lower commission rate relative to other product categories.

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Other Operating Expenses

• Though there was an increase of HK$102.3 million on Fulfillment costs, which only attributed to 18% of GMV on completed orders in 2018 vs 22% in 2017, benefited from the launch of first phase Robotic System, O2O shop pick-up altern ative plus Volume Gain .

• Marketing and promotional costs increased mainly for new customer acquisition, repeated purchases and O2O shop expansion from 15in December 2018 to 39 in December 2019, and related Talent Costs (but excluding HK$32.2mn deducted from Turnover (2017: HK$28.7mn)).

• During 2018, we have a unique customer base of 680,000 vs 477,000 in 2017 who made purchases with HKTVmall and/or HoKoBuyduring the respective year.

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As a % of GMV on 2018 As a % of GMV on 2017 VarianceFunctions completed orders HK$'mn completed orders HK$'mn HK$'mn

Fulfillment cost 18% 332.5 22% 230.2 102.3 Marketing and promotion including O2O shop 6% 119.1 6% 63.8 55.4 Ecommerce operation and supporting functions 10% 188.6 17% 178.9 9.7

Non-cash items:Amortisation expenses 1% 24.0 1% 15.1 9.0 Depreciation expenses 4% 67.5 5% 46.8 20.7 Equity settled share-based payment expenses 0% 7.2 3% 28.8 (21.6) Others 0% (1.3) 0% 5.0 (6.3)

40% 737.6 55% 568.6 169.0

Total GMV on completed orders 1,834.1 1,030.9

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Consolidated Statement of Financial Position

Solid balance sheet with strong liquidity - as at 31 December 2018, 1. Under Property, plant and equipment, include ~ 300,000 Sq. Ft. self-owned properties at TKO, investment and leasehold properties of about 100,500

Sq. Ft.. 2. Strong liquidity with investment in Other Financial Assets and cash balance, net of bank borrowings at HK$712.3 million.

Dec 2018 Dec 2017HK$'000 HK$'000 HK$'000 in %

Property, plant and equipment 1,115,347 1,152,387 (37,040) -3%Intangible assets 88,550 100,725 (12,175) -12%Other financial assets (Fixed income and Equity investment)

Non-current 656,634 675,161 (18,527) -3%Current 25,295 201,004 (175,709) -87%

Other receivable, deposits and prepayments 76,893 75,188 1,705 2%Inventories 54,322 26,912 27,410 102%Tax recoverable - 1,007 (1,007) NAPledged bank deposits 3,905 3,905 - NACash at bank, in hand and term deposits 105,901 100,199 5,702 6%

Total Assets 2,126,847 2,336,488

Accounts payable 146,493 92,951 53,542 58%Other payables and accrued charges 185,337 154,840 30,497 20%Deposits received 5,757 4,286 1,471 34%

Bank loans 79,392 219,623 (140,231) -64%Deferred tax liabilities 1,479 2,156 (677) -31%

Total Liabilities 418,458 473,856

NET ASSETS 1,708,389 1,862,632

Share capital 1,280,191 1,268,914 11,277 1%Reserve 428,198 593,718 (165,520) -28%

TOTAL EQUITY 1,708,389 1,862,632

Variance

Managed CAPEX for Sustainable Growth

384.6

182.1 154.8

372.5

189.5

140.1

2016 2017 2018

CAPEX (HK$ mn) Cash Outflow on CAPEX included Deposits Paid (HK$ mn)

Heavy construction CAPEX for new TKO headquarters was completed in 2016/2017. Upcoming CAPEX is scalable and for sustainable business growth –for the next 2 years, mainly including:

a) Phase II and III Robotic System and building plan remaining CAPEX estimated to be HK$112mn – Phase II launched in March 2019 and Phase III estimated to be delivered by end of 2020;

b) Expansion of logistics fleet for increase in order intake – Currently, we have 250 trucks in operation daily, including outsourced trucks; c) Renovation and equipment for new O2O shop opening – target to increase from 39 in December 2018 to ~ 120 by end of 2019.

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Business Review and OutlookBy Mr. Ricky Wong, Chairman

14

Strategies Developed in the Past 4 Years

INF

RA

ST

RU

CT

UR

E We built solid IT system and infrastructure for• Online Platform, • Warehouse and

Logistics• Customer Service• BIG DATA and Digital

Capacity

CO

NT

RO

L End-to-end ownership on the whole chain of process to • Deliver Quality of

Service• Drive for Continued

Growth Momentum

FO

CU

S We are “Focus”

• Visitors• Fulfillment and Last

Mile Delivery

Remarks:1. The sites in the top sites lists are ordered by their 3-month Alexa traffic rank.2. The sites in the top sites lists are ordered by their 3-month Alexa traffic rank. A site’s ranking is based on a combined measure of Unique Visitors and Pageviews. The site with the highest combination of unique visitors and page views is ranked #1. The site’s metrics are estimated and based on traffic patterns across the web as a whole and using data normalization to correct for any biases that may occur in the data.

Source : https://www.alexa.com/topsites/countries;0/HK

No. 1 Hong Kong Based Online Shopping Platform

Top Sites in Hong Kong - as at 15 March 2019

Ranking in Hong Kong Sites

1 www.google.com

2 www.youtube.com

3 www.facebook.com

4 www.google.com.hk

6 Yahoo.com

9 Taobao.com

15 www.amazon.com

17 www.price.com.hk

20 www.tmall.com

76 www.hktvmall.com374 www.fortress.com.hk

433 Zalora.com.hk

458 www.parknshop.com

517 www.ztore.com

993 https://www.broadwaylifestyle.com/

1154 www.watsons.com.hk

1355 www.wellcome.com.hk

1702 www.fingershopping.com

1900 www.sasa.com

2887 https//www.mannings.com.hk

5668 https://www.yata.hk

8310 marketplacebyjasons.com

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Methodology: YouGov BrandIndex first screened all of its 310 brands for positive Buzz, which asks respondents "Have you heard anything positive about the brand in the last two weeks, through advertising, news, or word of mouth?" Brands with low response volume were eliminated. From those brands, they were then ranked on Word of Mouth scores, which asks respondents "Which of the following brands have you talked about with friends and family in the past two weeks (whether in person, online, or through social media)?" All respondents for this research were adults 18 through 34 years old. Data was collected between September 1, 2016 and August 31, 2018

Top 8 “Most Positively Talked About” Brand in Hong Kong

Source: YouGov Brandindex

16

Commonly Used eCommerce Platform in Hong Kong

November 2018

17

Sources :1. Data on Unique Device is extracted from our

internal system and rounded to the nearestthousand. The data is collected based on thetracking cookies for web browser and thedevice advertising ID for app, which could beoverlapping if (a) same device is used tobrowse the online shopping web-pagethrough different browsers; (b) same deviceis used to open online shopping app and tobrowse online shopping web-page; and (c)the user amends the advertising ID of itsdevice. These data are unaudited and arenot indicative of the Company’s businessperformance, financial condition or growthprospect. Readers should not place relianceon these data.

2. Internal system3. Android Google Play Console and Apple

iTunes Connect

Dec 2018 Dec 2017

No. of Unique Devices landing on PDP or performing search

(source: 1)1,483,000 1,129,000

No. of Unique Registered Email Subscriptions

(source: 2)4,202,000 4,280,000

No. of Apps download (source: 3) 4,214,000 3,571,000

Facebook likes (source: Facebook) 921,000 896,000

The Largest Online / Digital Consumer Base

18

The Largest 24-hour Shopping Mall in Hong Kong

19Source: Google Analytics

10% of Hong Kong People (Age 18+) Had Purchased Fro m Us

20Source: Internal System

94,000

163,000

477,000680,000

2015

2016

2017

2018Combined Unique Customers(rounded to the nearest thousand)

GMV

Supermarket Products

34%

Other Categories31%

Electrical Appliances

18%

Personal Care & Skincare

17%

2018 GMV on Order Intake from Respective Product Cate gories

21

Are We Only an Online Supermarket?

Contact Lens2018: 240,000 vs 2017: 500

Lipsticks2018: 48,000 vs 2017: 9,000

Vacuum Cleaner2018: 28,000 vs 2017: 15,000

Mattress2018: 29,000 vs 2017: 12,800

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Full Service Marketplace HKTVmall and HoKoBuy

carrying 270,000 product items

280,000 Sq. Ft. Warehouses

Germany imported Robotic System with ~ 35,000 daily

orders capacity*

Largest HK Residential Distribution Network~250 Trucks in operation

~46 O2O Shops (as of today)

*In March 2019 : up to 20,000 daily orders capacity and by end of 2020 : increase to ~ 35,000 daily orders capacity23

3 CORE PILLARS for our NEW RETAILING MODEL

HKTVmall HoKoBuy 46 O2O Concept Stores (as of today)

Repeat Purchase Catalyst

Opening SoonDisney Products

Supermarket Personal Care and

Health

Fashion HousewaresMother & Baby

Sports and Travel

Dining and Lifestyle

Pets Electrical Appliances

Toys and Books

Skincare & Make up

Insurance

One-stop Shopping Experiences: Full range of product items from Own FMCG inventory to merchants offered varieties > 270,000 items

24

Motors

Full Services MarketplaceOnline & Offline, Product Variety, Total Solutions to Retailers

Record High – Double Promotional Effect

Keep breaking Single Day RECORD from “Flash Sale Tuesday ” and “VIP Day”

18 December 2018 8 January 2019

25

Traditional Retailing

Man to Goods

New Retailing

Goods to Man

Loss-making “Highly Manual Fulfilment Process” Stable & Profitable “Highly Automated Process”

Automated Warehouse Operation - Scalability, Cost Ef ficiency & Accuracy

26

Robotic Systems in HKTVmall Logistics Centre (Phase I & II)

27

Phase 3

Phase 2

Robotic System for ~ 35,000 Capacity

28

Investment

(HK$) Launch Date

Phase 1 29,000,000 ~ 10,000 Launhed in March 2018

Phase 2 92,000,000 ~ 20,000 Launhed in March 2019

Phase 3 52,000,000 ~ 35,000 Estimate by end of 2020

Estimated Daily Capacity

(No. of Orders)

Kwai Chung Frozen/Chilled Food Factory

25,000 sq. ft.

Tsing Yi eFulfillment Center

144,000 sq. ft.

Tseung Kwan O HQeFulfillment Center

111,000 sq. ft.

3 Fulfillment Centers in 280,000 Sq. Ft. for Differen t Types of Products

29

2017

June

2018

Now

2019

:15

:24

:46

:120+

Online Display > Offline Pick-Up Points

30

Gross Merchandise Value (HK$)

Date of OpeningOne month before shop

opened

One month after shop opened

Two months after shop

opened

Average Increment (x)

South Horizons 25-Jan-17 269,000 874,000 1,648,000 4.69

Tuen Mun Eldo Court

14-Sep-17 436,000 809,000 1,147,000 2.24

Lam Tin 2-Nov-17 550,000 1,462,000 1,383,000 2.59

Tai Wai 3-May-18 1,128,000 2,827,000 2,525,000 2.37

Tai Po 12-Jul-18 609,000 1,822,000 1,711,000 2.90

Proven O2O Shop Strategy

31Source: Internal data which is unaudited

Stage 1 : Order fulfilment (Primarily Variable costs)

Stage 2 : Online shopping mall operation (Primarily Fixed costs)

Stage 3 :Supporting functions including Admin, Finance, TM,

Technical operation (Primarily Fixed costs)

Stage 4 : Research and Development (Primarily Fixed costs)

Increasing number of orders

> lower distribution cost and higher Gross Profit Margin

HKTVmall P&L model

32

33

New Drivers in 2019

Senior Apps

Create Content beyond

“Shopping” by brand owners,

users, KOL, etc.

Social and Group

Purchasing Power

34

2019 Target to Achieve

GMV on Order Intake

2018: HK$1.89bn

2019: HK$3.2bn

O2O Shop Expansion

Dec 2018: 39

Dec 2019: 120

Thank You