The Group is principally engaged in the operations of the "Parkson" brand department stores. The businesses are located in China, Malaysia and Vietnam and the number of stores in each location are as follows:

(As at financial year-end) Number of Stores 2009 2008 Parkson China 42 40 Parkson Malaysia 33 32 Parkson Vietnam 5 4 80 76

Parkson China

Parkson China is not immuned from the global economic crisis but the impact is comparatively less severe. The Group had made necessary adjustments to its operating strategies to keep abreast with the challenging and fast changing operating environment. Aided by the following business plans and strategies, Parkson China has managed to record a respectable SSS growth in the current financial year: Organic Growth In line with the maturity of its existing stores profile, Parkson China reinvented and remodeled its stores to further enhance the stores image and performance. New Stores Opening Parkson continued to make solid progress in strengthening its operation and network. During the year under review, Parkson China opened one new store each in Shanghai and Guizhou to further consolidate its leadership position in the PRC retail market. Mergers and Acquisitions Parkson continued to execute its stated strategy to buy out the minority shareholders of the self-owned stores. The successful acquisitions of the remaining equity interests in Xi’an Shidai Parkson Store Co Ltd, Xi’an Lucky King Parkson Plaza Co Ltd and Nanning Brilliant Parkson Commercial Co Ltd have immediately enhanced the profitability of the Group and allowed greater flexibility in the implementation of our expansion plan. Plans are in the pipeline to expand the existing business by the opening of more greenfield stores in choice locations. Parkson China will also continue to explore opportunities for acquisition that meet its strategic initiatives and return on capital requirements.

Parkson Malaysia

Supported by its 22 years of operating track record in Malaysia, our local Parkson Division continued to deliver satisfactory performance despite weakening consumer sentiments and intensifying competition. Consistent space and product mix re-alignment, and increased sales and promotion activities have enabled Parkson Malaysia to capture encouraging market share. On-going refurbishment and upgrading of existing stores have also further enhanced the "Parkson" brand image and performance. In our endeavour to strengthen our operation and network, Parkson Malaysia took up anchor tenant status in Square One Mall, Batu Pahat in April 2009, followed by the opening of the Kota Bahru and Sabah stores in August 2009. These new stores have accordingly increased our domestic network coverage to 35 stores. Given the slower growth in the saturated local retail market, Parkson Malaysia will strive to strengthen its presence via enhancing brand awareness and loyalty, implementing timely store refurbishment and introducing more effective marketing and promotional programmes.

Parkson Vietnam

Parkson Vietnam, which opened its first department store in Ho Chi Minh City in 2005, is also not spared the drop in demand due to the weakening of consumer spending across regional economies. Being recognised as the pioneer in the operation of high end retail format in Vietnam, Parkson is expected to maintain its premier position as the economic downturn had resulted in a delay by foreign retailers entering the Vietnamese market. All our five (5) Parkson stores are located in the top three (3) cities in Vietnam, namely Ho Chi Minh City, Hanoi and Hai Phong. With the maturing of the existing stores together with the timely merchandise mix adjustments and aggressive marketing programmes, this Division continued to grow in the current financial year and contributed higher revenue and profit to the Group.