INVESTORS’ BRIEFING SESSION

4th March 2020

REFRESH ● REINVENT ● RECALIBRATE

1

Postal ServicesReduced revenue due to double-digit mail volume decline

2

1,760 1,682

FYE Dec 2018 (9mth) FYE Dec 2019 (9mth)

Revenue(RM million)

-4.4%

OthersContribution from other subsidiaries e.g Pos Digicert, Datapos &Pos ArRahnu inclusive RM3.8 mil from Pos Logistics.

AviationLower cargo tonnage due to cessation of AirAsia business

CourierMainly due to:• Malware attack in October 2019• Intensified competition affecting pricing• General change in consumer walk-in behavior

RM61 million

RM20 million

RM8 million

RM11 million

Financial Highlights

FYE Dec 2019 Revenue PerformanceRevenue decline mainly contributed by Postal Services & Aviation

-242

3

Core Losses

Goodwill Impairment

Aircraft Redelivery

-118Tariff rebalancing to sustain USO & Courier business growth to drive profitability

New management to refocus Pos Logistics business model

Outsourcing of aircraft operations already in effect since December 2019

Core Losses

Goodwill Impairment

Aircraft Redelivery

Loss Before Tax(RM million)

Financial Highlights

FYE Dec 2019 PBT PerformanceContinued mail revenue decline contributed to bigger core losses

-94

-29

Rationalize BusinessPotential divestment in non-core businesses

4

-202

15

-2

32

446 619

232 204

Segmental

Profit/(Loss)

(RM ‘mil)

Revenue

(RM ‘mil)

Postal Services Courier Logistics Aviation

Financial Highlights

Segmental Profit/(Loss) for FYE Dec 2019Sustainable Postal Services will bode well for Group’s profitability

The Transformation Journey Continues…

6

Postal Services

Tariff Rebalancing Will Improve Postal Services’ Sustainability;Potential RM10-15mil Incremental Monthly Revenue

New Postal Rates

Standard Mail (Commercial)

RM0.60 → RM1.30

Standard Mail (Non-Commercial)

RM0.60

Registered Mail (Commercial)

RM2.20 → RM3.10

Registered Mail (Non-Commercial)

RM2.20 → RM2.40

Private Letter box

RM50 → RM200

7

2020 Plan

Rationalise Post Offices• Relocation, right-sizing or closure

• Transform to e-Commerce fulfilment centre

• Explore retail operator model

Focus on Financial Services• Insurance (>RM470m premium sold in 2019, RM500m

target in 2020)

• Microfinancing

• Explore new services

Operational Efficiency • Streamline systems, cashless payment for faster servicing

• Potential equity divestment in Pos Ar-Rahnu

Customer Experience• Adopt Net Promoter Score (NPS) to monitor service level

Whilst Retail Transformation Aims to Improve Monetisation of Post Offices & Elevate Customer Experience

Postal Services

8

Online Shipping Portal Allows Easier Access to Pos Laju Services for SMEs

>17,000 sign-ups

3,400 parcels/day

RM2.8m top-up

purchased

• International shipment• Select Parcel Locker for

delivery• Insurance add-on

• Additional payment integration

• Same-day delivery • Return parcel

2019 Achievement

Launched SendParcel in Aug ‘19

2020 Plan

Enhance SendParcel

Courier

• Pick-up service• E-consignment note

• Delivery Tracking Features

9

Improving Digital Presence & Efficiency to Improve Visibilityand Speed

2020 Plan

Mobile App Enhancement

• Prepaid Purchase, Bill Payment, SendParcelIntegration

Workflow Automation

• Automate business processes (e.g. payment reconciliation) via Robotic Process Automation

Cashless Payment

• Introduce eWallet payment option in Post Offices (debit card in Q2)

Analytics & Performance Dashboard

• Performance management, operations planning

New Core Track & Trace• Improved package movement visibility

Courier

101.2%

10

Automated Sorting Systems Will Increase Speed of Parcel Processing and Delivery

2019 Achievement

Distribution Centres with

Semi-Auto Sorting Machines

2020 Plan

Distribution Centres with

Semi-Auto Sorting Machines

Distribution Centres with

Fully-Auto Sorting Machines

Mini Integrated Parcel Centre

+20

parcels processed per hour

saved per day

+20

+6

+1

Before

Today

+60% 1-2

Courier

5

Hours

11

Entrepreneurship Program and Crowdsourcing to Lower Fixed Cost

2019 Achievements

Entrepreneurship Program – POC

19 Riders (Shah Alam & KL)

Crowdsourcing (Pos Rider) – POC

100 Riders (Wangsa Maju)

2020 Plan

Entrepreneurship + Crowdsourcing

1000 Riders

-28% cost/item delivered

+50% items delivered/day

+100% take-home pay vs.

normal employment

Courier

204

12

Expansion of Touchpoints Through Partners

2019 Achievements

Agent Outlets for PosLaju

• 360 Agent Outlets

Grow Parcel Locker Network

• Total 255 Locations; >15,000 Locker Capacity

• 145 New Locations Added

2020 Plan

Expand Agent Outlets

• >2000 Agent Outlets

Increase Parcel Locker Utilization

• 70% Utilization (from ~50%); Brand Awareness Campaigns

Courier

510

13

Restructuring of Pos Logistics Aims to Improve Cost Efficiency

Logistics

2020 Plan

Strengthen Freight Forwarding Business.

Leverage On Strong Automotive Sector.

Rationalize Non-performing Business.

Boost Customer Trust By Improving Processes And Systems.

Improve Asset Utilization & Operational Efficiency.

• Asset-lighter approach

Leverage On Group’s businesses (CSR, Bernas, etc.)

2019 Achievements

Venture Into High-yield Services

• Specialized Transport for Linde

• Specialized Transport for CSR

14

Forming Strategic Alliances to Boost Pos Aviation’s Competitiveness

2020 Plan

• Inter-terminal transfer & cargo terminal at logistics park (with Airport Authority)

• Flight Service Report application

• Ground Support Equipment simulator

• SIA Engineering Company

Aviation

2019 Achievements

• AMAL Inflight Catering

• Regional cargo hub logistics for ecommerce

• Baggage services report

• Key Account Management

• Outsourcing & potential divestment

Revenue Diversification

Enhanced Service Quality

Partnerships

15

REFRESH ● REINVENT ● RECALIBRATE

THANK YOU