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08.2019 Group Briefing

FE SOGO 2019 Shareholders' Meeting

SOGO Department Store / Wu Minru
        The 2019 general shareholders’ meeting of Pacific SOGO Department Store (hereinafter referred to as "SOGO") was held on June 13. Last year's operational overview, performance and future prospects were announced. The anniversary performance of SOGO last year reached an all-time high, with annual revenue of 43.34 billion yuan and an increase of 1.3%, which was outstanding in the era of small profits in Department store industry. Looking forward to the future, SOGO will invest more resources to develop digital marketing in response to the new consumption era, while deepening VIP services to create high business gross profit and high business benefits. Operating revenue target for 2019 is 43.65 billion yuan, with an estimated growth of 1%.
Change and Innovation in the Age of Small Profits in Department Store industry are the Key to Winning
In 2018, the global economy was serious, the international financial market fluctuated sharply in the fourth quarter, and the market demand became conservative due to the sharp drop in oil price. Taiwan's economic growth rate was also affected, showing a slowing trend since the third quarter. In retail industry, the sales growth of department stores was only 2%, which was lower than that of other retail industries. In the fourth quarter, department stores grew negatively. It was obvious that the economy was affected by the changes of the environment. In addition, e-commerce, new business entities and competition in the same industry led to low growth.
In response to customer needs and services, SOGO actively adjusted the store environment, commodities and brands last year. A total of 426 cabinets, accounting for 16% of the total number of brands, were adjusted, together with topical marketing activities, so both passenger flow and business income increased. In 2018, the operating profit of SOGO was 2.28 billion yuan, growing by 8%; the net profit before tax was 830 million yuan, growing by 20%; the net profit after tax was 430 million yuan, growing by 8%; the revenue of anniversary reached 10.8 billion yuan, which set a new record in previous years.
Deep-ploughing Enterprises' Sustainability is affirmed at Home and Abroad
In 2018, SOGO continued to focus on CSR with Green Department stores, commodity safety and public welfare platforms being chosen as the key program, being ahead of the other department stores and wining the first prize in the best popular brand category of "National Brand Yushan Award", "Enterprise Environmental Protection Award of the Republic of China", "TCSA Taiwan Enterprise Sustainability Award" platinum award and so on, eighteen CSR awards at home and abroad altogether, and 6 affirmation of validation. In addition, the SOGO achieved the first "carbon reduction label" issued by the Environmental Protection Department of the Executive Yuan last year to set a good example for the department store retail service industry, with an exceptional performance of 25% carbon reduction in three years. The "So Good Children and Youth Model Selection" which has been held for several years calculated the SROI as 10.18, which means that every $1 invested can create 10.18 times the positive impact on society. At present, SROI is the highest project in Taiwan's public welfare activities of the same type.

In May this year, SOGO was awarded the Green Leadership Award of Asia Responsible Enterprise Awards by the Asian Chamber of Commerce and Industry, becoming the only department store retailer in Asia to win three major awards and seven Labor Safety Awards since the award was held.
In the future, SOGO will take innovation as its core, pursue performance and actively enter the society. It will carry out its sustainable mission with innovative management, high-quality commodity, moving service, happy workplace, caring platform and sustainable environment to create a digital integrated happiness and fashion.
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