#1A-Living Smart City Services Co., Ltd. (3319.HK) FY2020 Annual Results March 2021 M#2Disclaimer Alen This presentation may contain forward-looking statements. Any such forward-looking statements are based on a number of assumptions about the operations of the A-Living Smart City Services Co., Ltd. (the “Company”) and factors beyond the Company's control and are subject to significant risks and uncertainties, and accordingly, actual results may differ materially from these forward-looking statements. The Company undertakes no obligation to update these forward-looking statements for events or circumstances that occur subsequent to such dates. The information in this presentation should be considered in the context of the circumstances prevailing at the time of its presentation and has not been, and will not be, updated to reflect material developments which may occur after the date of this presentation. The slides forming part of this presentation have been prepared solely as a support for oral discussion about background information about the Company. This presentation also contains information and statistics relating to the China and property development industry. The Company has derived such information and data from unofficial sources, without independent verification. The Company cannot ensure that these sources have compiled such data and information on the same basis or with the same degree of accuracy or completeness as are found in other industries. You should not place undue reliance on statements in this presentation regarding the property development industry. No representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of any information or opinion contained herein. It should not be regarded by recipients as a substitute for the exercise of their own judgment. Information and opinion contained in this presentation may be based on or derived from the judgment and opinion of the management of the Company. Such information is not always capable of verification or validation. None of the Company or financial adviser of the Company, or any of their respective directors, officers, employees, agents or advisers shall be in any way responsible for the contents hereof, or shall be liable for any loss arising from use of the information contained in this presentation or otherwise arising in connection therewith. This presentation does not take into consideration the investment objectives, financial situation or particular needs of any particular investor. It shall not to be construed as a solicitation or an offer or invitation to buy or sell any securities or related financial instruments. No part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. 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No public offer of securities is to be made by the Company in the United States. 2#3Results Highlights 01#4Results Highlights Revenue Hit 10 Bn Record High A Revenue 10,026 mn A Gross profit 2,973 mn A Net profit 1,973 mn +95.5% +57.9% +52.7% ▲ Core profit attributable to shareholders 1,800 mn +43.5% Λ Basic earnings per share Annual dividend per share Ever-expanding scale coupled with a more balanced portfolio A Total contracted GFA reached 718 mn sq.m.; total GFA under management reached 569 mn sq.m.* Fruitful results in third-party expansion: newly obtained 46 mn sq.m. of contracted GFA from third-party expansion and increased the proportion of contracted GFA from third-party developers to 74.1%. * Developed a comprehensive business portfolio and established advantages in niche markets. Among GFA under management: residential properties - 40.4%; public buildings - 46.5%; commercial and office buildings: 13.1% Broke through boundaries to get city services off ground A Strategically upgraded into a full-scenario integrated service platform and officially renamed as "A-Living Smart City Services Co., Ltd." A Established City Services segment and rapidly complemented the nationwide business layout through market expansion and M&A The Group currently manages a total of 130 projects under city services segment, with a total contract value of RMB13 bn and a total annualized contract value of RMB2 bn# RMB1.32 RMB0.52 ^ Excluding the effect of the amortisation of intangible assets and depreciation of appraised appreciation of fixed assets due to the M&A *Incl. GFA of New CMIG PM, associates and consultant projects ^ Incl. associates, as at 22/3/2021 A Optimized revenue mix and innovative services Further optimized revenue mix with a significant rise in non-cyclical business. In terms of three business lines, property mgt services accounted for 64.7% of total revenue, property owners VAS 10.5%, and extended VAS 24.8% Developed innovative services and delivered standardized products that drove property owners VAS to grow by 116.9% YoY Efficiency improvement and platform empowerment Upgraded post-acquisition management platform, overhauled business segments and business lines and integrated branding and marketing resources to achieve collaborative development. Realized a shared business platform with deep integration through Group's lean management A Joined hands with Huawei and Sense Time to develop smart service platforms to enhance service level with technologies Put quality first and unveiled a brand upgrade initiative A leading player in the industry ranked 4th of "2020 Top 100 Property Management Companies in China", driving A-Living's brand value to nearly RMB10 bn. * Upholding the vision of “lifelong caring", the Group increased the overall satisfaction rate for the third consecutive year to 91.1% Included in the HSCI (mid-cap) and eligible stocks for Shanghai-Hong Kong Stock Connect and Shenzhen- Hong Kong Stock Connect Remark: for the year ended 31 December 2020 (Currency: RMB) Alen 4#5Results Summary 02#6Results Overview Revenue RMB10,026 mn +95.5% YoY Gross Profit RMB2,973 mn +57.9% YoY Net Profit RMB1,973 mn +52.7% YoY Profit Attributable to Shareholders RMB 1,754 mn +42.5% YoY 8,000 6,000 Revenue and Growth Rate (by Business Lines) 129.1% 6,482 37.5% 4,000 2,830 2,491 1,812 2,000 2019 ■2020 (RMB mn) Gross Profit and Gross Profit Margin (by Business Lines) 2019 GP 2020 GP 2019 GP Margin 2020 GP Margin (RMB mn) 1,500 1,414 116.9% 1,000 25.3% 49.8% 40.1% 903 999 715 21.8% 1,053 500 485 54.4% 53.2% 560 264 0 0 Property Mgt Services Extended VAS Property Owners VAS Property Mgt Services Extended VAS Property Owners VAS 6#7Financial Highlights % of % of RMB mn 2020 2019 Change revenue revenue Revenue 10,026 5,127 +95.5% Cost of sales (7,053) (70.3) (3,244) (63.3%) +117.4% Gross profit 2,973 1,883 +57.9% Gross profit margin 29.7% 36.7% (7.0 p.p.) Selling and marketing (77) (0.8%) (43) (0.8%) costs Administrative (548) (5.5%) (295) (5.8%) (0.3 p.p.) expenses Income tax rate 20.7% 23.8% (3.1 p.p.) Net profit 1,973 1,292 +52.7% Net profit margin 19.7% 25.2% (5.5 p.p.) Profit attributable to the shareholders of 1,754 1,231 +42.5% the Company 7#8Financial Highlights RMB mn 2020 2019 Change Total assets 13,975 9,388 +48.9% Total equity 8,657 6,506 +33.1% ROE 25.9% 21.2% +4.7 p.p. +43.5% EPS (RMB per share) 1.32 0.92 Annual dividend per share (RMB) 0.52 0.45 +15.6% Cash and cash equivalents 5,057 4,207 +20.2% Operating cash flow 2,621 1,600 +63.8% Operating cash flow / net profit 132.8% 123.8% +9.0 p.p. 8#9Business & Operation Review 03#10Property Management Services - High-quality growth in core business Revenue from property mgt services increased by 129.1%, accounting for 64.7% of total revenue, up 9.5 p.p. YoY 8,000 6,000 4,000 (RMB mn) 2,000 2,830 Revenue 129.1% 6,482 2019 2020 Higher revenue contribution from property mgt services with a solid organic growth Alen Gross profit Revenue mix improved significantly and proportion of property mgt services in revenue increased by 9.5 p.p. 2,000 (RMB mn) 1,500 1,000 500 715 97.8% 1,414 2019 2020 Revenue from property mgt services surged by 129.1% YoY • Steady growth in gross profit and increased proportion of non-residential businesses Gross profit of property mgt services totaled RMB1,414 mn, increased by 97.8% YoY Gross profit of non-residential business accounted for nearly 50% of total gross profit, representing a further increased proportion and a more balanced business portfolio structure 10#11Property Management Services - Ever-expanding scale and comprehensive business portfolio GFA Under Management (mn sq.m.) Over 569 mn^ Contracted GFA Aren 500 112.3% ■31/12/2019 31/12/2020 400 374.8 700 163.7% 600 300 301.1 500 74.9% 522.6* Over 718 mn^ (mn sq.m.) ■ 31/12/2019 ■31/12/2020 113.2% 176.6 200 11.1% 400 387.4 100 114.2 300 298.8 62.7% 53.8 59.8 200 181.7 6.5% 0 Total GFA under mgt (% of Total) # Incl. M&A * Excl. GFA of consultant projects Third-party# (64.7%) (80.3%) 8.6 13.9 100 32.5% Agile (30.5%) (16.0%) Greenland (4.8%) (3.7%) 0 Total Contracted GFA 77.1 82.1 53.1 40.1 ^ Incl. New CMIG PM, associates and consultant projects Breakdown of Projects Under Management By GFA Under Management (% of Total) (60.8%) Third-party# (74.1%) Agile (25.8%) (15.7%) Greenland (13.4%) (10.2%) Reserved GFA By Segment Revenue Reserved GFA as at 31/21/2020 148 127 21 (mn sq.m.) Contracted GFA/GFA under mgt 1.39x 1.63x 1.12x 523 13.1% ■Residential properties ■ Residential ■ Public buildings 40.4% 43.1% 56.9% ■ Non-residential ■Commercial buildings 46.5% and complex 328 375 ■Contracted GFA ■GFA under mgt 201 195 174 Total Residential and commercial properties Public buildings 11#12Property Management Services - All-out efforts in market expansion and completed nationwide coverage • Encouraging news on market expansion In terms of market expansion, newly obtained approx. 46 mn sq.m. of contracted GFA from third-party developers. Average management fee of newly obtained projects is approx. RMB2.5/sq.m./month Backed by shareholder, newly added contracted GFA from Greenland Group reached 13 mn sq.m., with an annualized contract value of over RMB500 mn. Average management fee of such projects is approx. RMB3.2/sq.m./month Achieved breakthroughs in business portfolio, strengthened the advantages in niche markets, and obtained approx. 30 projects each with an annualized contract value of over RMB10 mn Breakthroughs in business portfolios Leading positions in niche markets Regional penetration under a nationwide layout Newly entered into 74 cities, establishing presence in 167 cities and realizing a full coverage of all provincial-level administrative regions in China Largely concentrated in economically developed regions with 80% of projects under management distributed in first and second-tier cities City Services River Cleaning Featured Towns Wellness real estate Operation and maintenance of small public restrooms in Shenzhen - Market expansion of city services High-end commercial buildings Ecological restoration of Dingtang River - The Group's river cleaning project Railways Dayun Al Town - A featured town project with a contract value of over RMB 10 mn Customized services for enterprises Wellness property project at Qinghaihu in Xiangyun County, Dali City A large-scale multi-portfolio project Mega residential project 300m super high-rise Greenland Energy IFC (Xi'an) More than 10 railway projects in Shanghai, Nanjing, Xi'an and other cities - One of the super high-rise landmark projects - Advantages in niche markets of public buildings Agricultural Bank of China - R&D Center (Shanghai) - Offered further and customized services to existing clients Greenland Hangzhou Bay - One of the mega residential projects obtained during the year 15.1% 3.0% 3.6% Business Coverage by Region 8.1% 9.5% 25.0% 35.7% Yangtze River Delta Region ■Greater Bay Area ■ Chengdu-Chongqing city cluster Lanzhou-Xining city cluster ■Northern Bay city cluster Harbin-Changchun city cluster Business Coverage by City Tier System ■ Others 20.0% 29.9% - Tier 1 ■ New Tier 1 26.3% 23.8% - Tier 2 Tier 3 & 4 or below 12#13Property Owners VAS - Deeply explored property owners' needs to achieve rapid growth Property owners VAS recorded revenue of RMB1,053 mn, up 116.9% y-o-y, accounting for 10.5% of the total revenue, with a GP margin of 53.2%, decreased by 1.2 p.p. y-o-y $ Platforms Community resources . Revenue: RMB303.0 mn Parking lot operation Community advertisement / Clubhouse operation / Rental and leasing services Successfully launched community second-hand property brokerage, community nursery, community telecommunication service 乐乐。 通信 GP • Offered online and offline integrated marketing solutions and achieved significant growth in revenue 雅居乐租售服务中心 租售找物业。 100% Channels Customized Services +38.4% YoY Contribution to segment revenue: 28.8% Living and comprehensive services Revenue: RMB394.9 mn +130.8% YoY Contribution to segment revenue: 37.5% Home improvement "Xiaoya" series homecare services / "Lexianghui" series retail and group buying services Upgraded Lexianghui Mall, generating monthly GMV of up to RMB20 mn Established nationwide strategic cooperation with well-known brands, steering 119% YoY growth in community-based new retail Developed "Xiaoya" fast repair brand with professional services, driving revenue growth of more than RMB30 mn Revenue: RMB118.3 mn Cooperated with: • +24.3% YoY 五粮液 Vinda P&G M Contribution to segment revenue: 11.2% Turnkey furnishing / House appliances / House renovation / House rehabbing Covering house's full life cycle, bolstered by a supplier matrix formed strategically with well-known home improvement brands such as Suofeiya and Dynasty Home 真房源、无差价、更靠谱 3698 ARDE 乐享荟维达 陪你韧性过年 3年500万 产品责任险 牛起来 ERTY □第八代经典天粮液、 GOOD 302 小雅快收 社区快递收件便民服务 SPARE RAV Partnered with: JDL 京东物流 China C unicom中国联逸 Self-developed brands and IPs: Non-residential VAS Revenue: RMB236.5 mn Contribution to segment 乐享荟 乐洁 乐乐通信 乐乐健康 revenue: 22.5% Catering Commuting / Procurement / Customized services to enterprise/conference affairs Built a comprehensive VAS model covering multi-business portfolios through resource sharing and created specialized services for non- residential properties to meet the needs of corporate customers 乐洁家政 安心服务后顾无忧 雅居乐业主报装 纷享超多福利 联通宽带已覆盖本区域 100%纯光纤接入 「就地过年不寂寞: 缤纷好礼® 送关怀 乐乐陪你过大年 ☐ 13#14Extended VAS - Focused on core businesses while offering full-cycle services Extended VAS recorded revenue of RMB2,491 mn, up 37.5% y-o-y, accounting for 24.8% of the total revenue, decreased by 10.5 p.p. y-o-y; GP margin was 40.1% weren 2019 35.3% 41.2% Proportion of cyclical business to revenue dropped significantly 24.8% 35.1% (RMB mn) ■2019 1,500.4 2020 990.9 2020 701.8 1,110.5 Revenue from extended VAS / Total revenue Sales center mgt services Other extended VAS Ex I AGILE 庐隐竿A ARLY A CHIXING Full-cycle management Asset-light model Reception / Security / Venue maintenance / Equipment maintenance Marketing/Sales agency / Referral Marketing One-stop property developer VAS House inspection / Technology support / Other consulting services 14#15Co-Development and Deep Integration Brand Matrix Market Synergy Reshaped the non-residential business centered on public buildings and established a brand matrix to deliver standardized services under multiple brands Established sets of service standards and brand operation standards for each type of property in the niche market, including public venues, transits, parks, schools, hospitals and other public buildings . • Established a strategic market map backed by big data and enhanced market penetration in different cities according to economies of scale in regional level Empowered the acquired companies ranked among Top 100 through precise and differentiated positioning of brands by cities and portfolios • Information Empowerment Mechanism Empowerment • Improved management efficiency and quality by building an operation and management platform Empowered the acquired companies to address their needs and pain points in management, finance, operation and business informatization • Introduced the Amoeba mechanism to invigorate the market expansion capabilities of the acquired companies and continuously achieve incremental growth through business fission • Implemented an incentive mechanism to stabilize talents and share the long-term development benefits with them 2020- Year of platform building Overall net profit margin of the acquired companies increased by 1.5 p.p. Total annualized contract value increased by more than 17% YoY to RMB 6.8 bn* *Incl. New CIMG PM 30% of projects due for renewal achieved fee hike with management fee rising by an average of 7% 15#16Quality First and Brand Upgrade Г A guardian for property owners Upheld the vision of “lifelong caring for property owners" to create "heart-warming communities", with annual management fee collection rate hitting 94.1% Property owners' satisfaction rate increased for the third consecutive year to 91.1%, 7.8% higher than the average of TOP20 peers Unveiled a corporate IP - Xiaoya • A shield for communities Stood on the front-line of epidemic prevention to safeguard the lives and health of millions of property owners; upgraded protection standards and normalized epidemic prevention and control measures Participated in the formulation of industry • standards and took lead in compiling guidelines for epidemic prevention and specifications for public facilities and equipment E III III Alen • Officially changed the company name to "A-Living Smart City Services Co., Ltd." in a move to realize strategic upgrade Launched a brand upgrade plan to refine brand positioning and overhaul brand matrix strategy, aiming at creating differentiated advantages A-Living's ranking in terms of comprehensive strengths reached a record high with its advantages in the niche markets Ranks the 4th of the "Top 100 Property Management Companies in China", and its seven brands have also been listed in the Top 100, with a brand value reaching RMB9.796 bn Awarded as the "2020 Leading Specialized Property Management Company in China - A Leading Brand in the Provision of Comprehensive Public Building Services" Actively participated in the innovation and reform of capital market, becoming the first batch of listed companies to complete H share full circulation, which strengthened the foundation for long-term development Included in the HSCI (mid-cap) and eligible stocks for Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect Awarded as the "Most Honored Companies" by Institutional Investor 16#17City Services Layout 04#18Mapping Out a Nationwide Layout for City Services Waren Yahao A subsidiary of A-Living specialized in city services business Shaanxi Mingtang Acquired 60% equity interest One of Top 100 environmental sanitation service enterprises in China ZH Sanitation Acquired 30% equity interest Ranked 10th out of Top 100 environmental sanitation service enterprises in China* City Services Segment Collaborative development of seven regions to shape a nationwide layout Dalian Mingri Acquired 51% equity interest Ranked 16th out of Top 100 environmental sanitation service enterprises in China* Beijing Huifeng Acquired 51% equity interest Ranked 28th out of Top 100 environmental sanitation service enterprises in China^ Anhui Yurun Intended to acquire 51% equity interest One of Top 100 cleaning services brands in China Business layout of city services Strategy implementation: Mapped out a development strategy for city services to further extend industry value chain and enhance the anti-cyclicality and growth ability of business Brand upgrade: Acquired the Top 10, Top 100 or regional dominant brands through equity acquisition to form a strong alliance and enhance the market influence Leading scale: Currently manages over 130 projects with a total annualized contract value of over RMB10 bn #, lifting A- Living as a leading city services enterprise Nationwide layout: Seven regional offices will collaborate with the acquired companies to form a nationwide layout and establish a dominant position in each regional market Expansion capability: Extensive experience and qualifications together lay a solid foundation for further market expansion City services business is making some headway with more than 130 projects under management, covering 53 cities in 20 provinces, autonomous regions and municipalities, representing a total annualized contract value of over RMB2 bn and total contract value of over RMB 13 bn# • Following the strategy, A-Living recently acquired 5 leading city integrated services enterprises for a total of RMB1.18 bn at a roughly 10 times P/E ratio, and rapidly mapped out a city services layout by adding Top 10 and Top 16 environmental sanitation service companies to the Group Source: Huanjingsinan, 2020 Top 100 Enterprises *According to total contract value ^According to annualized contract value #Incl. associates as at 31 Dec 2020 18#19A Good Business with Stable Performance Large- scale Large-scale projects with long-term contracts Asset-light Diversified partnership with asset-light DNA • . The acquired companies are expected to hit a revenue of over RMB 2.5 bn as a whole in 2021, given their solid track records of profitability. Their average GP margin was 24.7% and average NP margin was 12.5%. The average contract duration of projects under management is 5.73 years and the renewal rate in 2020 was higher than 95%. • Government's bidding and procurement process is transparent, and the business model is asset-light. • PPP (public-private partnership) project only accounts for 7% of total projects, which has a manageable investment amount and can secure contracts with higher contract value and longer duration. Stability High collection rate and solid cash flow Resilience A non-cyclical and defensive business • . Low risk of default as city services is included in the government budget and enjoy a priority in payment with settlement cycle usually no longer than one quarter. The past fee collection rate of acquired companies has been remained stable above 95%. Their cash flow is in healthy condition with controllable investment. Unaudited figures for the year ended 31 December 2020. Incl. subsidiaries and associates . As a rigid demand, city services' development is less affected by macroeconomic factors without obvious cyclical fluctuations. With such a steadily growing business and a relatively flexible pricing mechanism, the annualized contract value of acquired companies grew at a CAGR of over 53% from 2017 to 2020. 19#20Outlook 05#21A New Vision Empowered by Intelligence, Eyeing Two "Hundred-Billion-Yuan" Platforms Alen Holding company platform A-LIVING 雅生活 A-Living Smart City Services Co., Ltd. 3319.HK Platform Development of industrial platform Incubation of innovation platform Residential sector Non-residential sector City services sector Innovative Industry Chain Underpinned by: Capital Talents Technology New Hundred-Billion-Yuan Platform 21 27#22Development of Industrial Platform Residential sector Non-residential sector City services sector Manage residential GFA of over 150 mn sq.m., over 1000 projects, serving 1.5 mn property owners Manage a diverse portfolio of high-end and large-scale residential projects, luxury mansions, cultural and tourism properties, whose owners with high spending power serving as valuable user base for VAS Quality-first service to property owners Explore upstream and downstream along the industry chain to enhance brand power and improve service quality Provide all-round services to improve the quality of life and create a better life for property owners GFA under mgmt of non-residential properties accounts for 59.6% of total GFA under mgmt, accounting for of 56.9% total revenue of property mgmt A nationwide layout backed by excellent market expansion capability A comprehensive portfolio with multiple brands in niche markets Industry-leading scale backed by strong brands Integrate brand strengths and deepen nationwide penetration Extend industry chain to build urban ecosystem and create differentiated non-residential service platform Hundred- Billion-Yuan Industrial Platform Collaboration among nationwide channels for resource sharing Join hands with high-quality enterprises to reach a total contract value of more than RMB 13 bn* Strive for a large-scale, high-value and nationwide layout Industry integration aim at city services Implement city services rapidly and upgrade city smart management Collaboration among sectors to generate economies of scale and form a full-scenario service platform *Incl. associates as at 31 Dec 2020 22 Alen#23Incubation of Innovative Platform Build an innovation platform through strategic business layout and diversified cooperation to incubate upstream and downstream businesses and build a full-scenario service platform for urban life Team up with leading companies in different fields to improve service in niche markets, enhance diversified development and provide differentiated comprehensive services to property owners Policy tailwinds Notice on Strengthening and Improving Residential Property Management The government encourages property management companies to explore the development of fields such as elderly care, childcare, housekeeping, culture, healthcare, leasing, express delivery, information technology, etc. Opinions of the General Office of the State Council on Promoting the Healthy Development of Elderly Care and Childcare Services [2020] (No.52) The government encourages property management companies to vigorously develop elderly care, child care, house rehabbing (incl. house rehabbing for the elderly and the young, urban re-development, etc.), group meal, leasing, medical treatment, healthcare and other businesses Innovation of Industry Layout and Discovery of Diversified Businesses • Industry chain of property mgt services Focus on property management's upstream and downstream industries and build a centralized cost management platform for key areas and businesses to bring economies of scale into play Improve the consistency in service delivery and break through the boundaries of service area Industry chain of VAS Focus on the upstream and downstream of supply chain to identify and fill the blanks of business and strive for flexible and innovative deployment for VAS business Focus on VAS strongly encouraged by the government and create a VAS service platform for "property services + living services" Industrial chain of urban ecology Focus on urban life scenarios and explore the possibility of developing cross-sector comprehensive services Broaden the market of comprehensive city services through extension of business and cross-sector cooperation 23#24Lifelong Caring for A Better You A-Living Smart City Services Co., Ltd.