1

June 10, 2016

DEBORAHWEINSWIG,MANAGINGDIRECTOR,FUNGGLOBALRETAIL&TECHNOLOGYDEBORAHWEINSWIG@FUNG1937.COMUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2016TheFungGroup.Allrightsreserved.

+5.4%CHARTOFTHEWEEK

STATOFTHEWEEK

STATOFTHEWEEK

D E B O R A H W E I N S W I G M A N A G I N G D I R E C T O R

F U N G G L O B A L R E T A I L & T E C H N O L O G Y d e b o r a h w e i n s w i g @ f u n g 1 9 3 7 . c o m

U S : 6 4 6 . 8 3 9 . 7 0 1 7 H K : 8 5 2 . 6 1 1 9 . 1 7 7 9

C H N : 8 6 . 1 8 6 . 1 4 2 0 . 3 0 1 6

JUNE 10, 2016 • Thisweek,weintroducedournewconceptregardingopportunities intheretailindustry:theFour-QuadrantDisruptorsFramework,whichidentifiesfourareasofopportunityforinnovativeretailersandstartups.Theframeworkwasformulatedas a response to the “retail destruction” seen in the US very recently,when anumberofmajorretailnamesreporteddisappointingresults.

• Astheathleisuremarketapproachessaturation,“streetnic”apparel—madewithengineered fabrics that apply the stretch and performance of athleticwear toeverydayclothing—maybethenextbigtrend.Consumershavecometoexpectthe comfort of athleisure, and now retailers areworking to create fashionableclothingthathasthefunctionalitiesofathleticapparel.

• Spanish retail chain El Corte Inglés has opened a store dedicated entirely towomen’sproducts inMadrid’sCalledeSerrano,thepreferredlocationforsomeof Europe’s best-known brands in the city. Thismove follows the successof itsSerrano 52 MAN store, which opened on the same street last year, cateringexclusivelytomen.

• AccordingtoeMarketer,195millionpeopleinChinawillbeusingtheirphoneasawalletby the endof2016.That represents38%ofall smartphone users in thecountry,and isdouble therateofsmartphonestorepayments intheUS.Thereare three mainmobilewallet options in China,WeChat, Alipay and newcomerApplePay.WhileWeChatandAlipaygenerateaQRcodeforscanning,ApplePaytiesupwithChina’sbiggestcardnetwork,UnionPay.

$14.3Bil.• SpendingforFather’sDay,whichfallsonJune19thisyear,isexpectedto

reacharecordhighof$14.3billion—thehighesttotalsincetheNationalRetailFederation(NRF)begansurveyingconsumersabouttheholiday13yearsago,butlowerthantheMother’sDay2016totalof$21.4billion.

• TheNRFprojectsanaverageFather’sDayspendperpersonof$125.92,upfrom$115.57lastyear.

• Topgiftchoicesthisyearincludeexperiences,clothingandgiftcards.

• TwoinfivemillennialsareplanningtogiveDadagiftofexperiencethisyear,apercentagethatissignificantlyhigherthanthatofoldergenerations.

Source:UPS/comScore

22%

20%

16%

42%

Researchonlineandinstore,buyinstore Searchandbuyinstore

Researchonlineandinstore,buyonline Searchandbuyonline

Source:NRF

Consumers’OnlineShoppingHabits

2

June 10, 2016

DEBORAHWEINSWIG,MANAGINGDIRECTOR,FUNGGLOBALRETAIL&TECHNOLOGYDEBORAHWEINSWIG@FUNG1937.COMUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2016TheFungGroup.Allrightsreserved.

FROMTHEDESKOFDEBORAHWEINSWIG

IntroducingtheFour-QuadrantDisruptorsFramework

This week, we introduced our new conceptregardingopportunitiesintheretailindustry:theFour-Quadrant Disruptors Framework. Thismodel identifies four areas of opportunity forinnovative retailers and startups that serve theretailindustry,andwasformulatedasaresponseto the “retail destruction” seen in the US veryrecently,when a number ofmajor retail namesreporteddisappointingresults. In thecontextofthisquickly shifting retail landscape,we identifyfourareasofopportunity:newretailmodels,all-channel, experiential retail and customerengagement.

We summarize thesequadrants of opportunity below, anddirect readers to our full report on fbicgroup.com forcompletedetailsoftheframework,includinggreatercontextandprofilesofcompaniesoperatingwithineachspace.

NewRetail

New retail models identify “white spaces” in how consumers shop in the evolving retail world, whether that isthroughanonlinebarter community suchas reKindness,or throughamarketplace suchas Ideally that lets themnametheirownpriceforgoods.Thisquadrantalsoincludessomemorecommonemergingretailmodels,includingmarketplaces suchasEtsy, sharingeconomybusinesses suchasRent theRunwayandcaringeconomybusinessessuchasTOMS.

All-Channel

The all-channel model offers significant opportunities for retailers and startups to merge shopping channels, soconsumerscanshopseamlesslywhenandwhere theywant to.Theall-channelstartupand innovationecosystemincludes e-commerce platform solutions, “click and arrive” reordering shopping buttons, next-generation storelocationsthatbroadcastin-storeinventoryonline,andin-storesmartdisplaysdesignedtoprovideconsumerswithinformationonproducts.

ExperientialRetail

Experiential retail encompasses retailers and technology startups thatwork to repurpose existing store space tomake the shopping experience frictionless and more fun; stores thus become a natural complement to thefunctionalityofferedbyonlineshopping.Thisquadrant is importantbecause,eventhoughtheonlinechannelhasbeendrivingsignificantsalesgrowth,over90%ofUSretailsalesstilltakeplacein-store.Technologiesthatfallunderthiscategoryincludevirtualfittingrooms,self-checkoutsolutionsandaugmentedrealityapplications.

CustomerEngagement

Startupsandinnovatorsthatfitintothecustomerengagementquadrantexplorewaysinwhichretailerscanconvertconsumers tocustomersandenhance interactionswith theircustomersondifferentplatforms.Thisarea includesgamification,recommendationenginespoweredbyartificial intelligence, influencermarketingandsocialshopping“evangelizeandthrive”apps.

In short, the Four-Quadrant Disruptors Framework emphasizes the fact that retailers need to provide totalconvenience, and that theymust develop deeper connections with their customers.We see those retailers thatadoptnewretailmodelsandprovidecross-channelconvenience,improvedexperiencesandgreaterengagementasbeingwellpositionedtogainshare—andthiswilllikelybeattheexpenseofthosegeneralistretailerswhosecatchallpropositionsappeartoberesonatinglessandlesswithshoppers.

• For a complete discussion of our Four-Quadrant Disruptors Framework concept, together with profiles ofselectedkeycompaniesineachquadrant,pleaseseeourfullreportonfbicgroup.com.

3

June 10, 2016

DEBORAHWEINSWIG,MANAGINGDIRECTOR,FUNGGLOBALRETAIL&TECHNOLOGYDEBORAHWEINSWIG@FUNG1937.COMUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2016TheFungGroup.Allrightsreserved.

USRETAILEARNINGS

Source:Companyreports

USRETAIL&TECHHEADLINESAthleisureIsPavingtheWayforTechnicalApparel(June8)Glossy

• Astheathleisuremarketapproachessaturation,LululemonAthleticafounderChipWilsonsaysthat“streetnic”apparel—madewithengineeredfabricsthatapplythestretchandperformanceofathleticweartoeverydayclothing—isthenextbigtrend.

• Consumershavecometoexpectthecomfortofathleisure.Now,retailersareworkingtocreatefashionableclothingthathasthefunctionalitiesofathleticapparel.Forexample,KitandAceinventedamachinewashable“technicalcashmere.”

CultivatingBrandLoyaltyinEventheToughestCustomer(June5)TheNewYorkTimes

• AccordingtoareportbyColloquy,loyaltyprogramshavegrownby26%since2013,andtotaled3.3billionmembershipsnationwidein2015.However,whiletheaveragehouseholdhasmembershipswith29loyaltyprograms,only12ofthemaretypicallyused,whichmeansthenumberofmembershipsusedhasactuallydecreasedby4.5%since2013.

• Loyaltyprogramsareeffectiveatattractingcustomers,buttheycannotjustofferadiscountorfreedessert.Companiesneedtoadjusttoeffectivelyusetheimportantdatatheyreceivefromcustomersinordertopersuadethemtobuymore.

MallLandlordsEmbraceHigh-TechtoEnticeShoppers(June7)RetailingToday

• Retailershavetypicallybeentheonesinvestingintechnologytoimprovethecustomerexperience.Butasstoreclosureshaveincreasedpressureonlandlords,they,too,arebeginningtopourmoneyintotechnology,investinginmappingfunctionstohelpshoppersfindparkingspaces,navigatemallcorridorsorfindaflashsaleatastoreonefloorabove.

• Landlordshopetobetterconnectwithshoppers,sparkingmoreactivityandpossiblygivingthemselvesanedgeinleasenegotiationswithretailers.

Company

Revenues($Mil.) ChangeYoY GrossMargin(%) Change

NetIncome($Mil.) ChangeYoY StoreFleetEOP

Period 2016 2015 (%) 2016 2015 (BP) 2016 2015 (%) 2016 2015

Hudson'sBay 1QEApr. 3,300 2,072 59.3 41.9 41.2 70 (97) (49) 98.0 470 327

Lululemon 1QEMay 496 424 17.0 48.3 48.6 (35) 45 48 (5.2) 373 316RestorationHardware 1QEApr. 455 422 7.8 28.0 34.0 (597) (13) 7 (288.2) 69 67

WEINSWIG’SWATCHING

Thisweek,theUSFungGlobalRetail&TechnologyteamattendedtheWomeninSTEMSummitinSanFrancisco,CA,whiletheUKteamattendedtheMakeUpinPariseventattheCarrouselduLouvre.

4

June 10, 2016

DEBORAHWEINSWIG,MANAGINGDIRECTOR,FUNGGLOBALRETAIL&TECHNOLOGYDEBORAHWEINSWIG@FUNG1937.COMUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2016TheFungGroup.Allrightsreserved.

WeakProductivity,RisingWagesPuttingPressureonUSCompanies(June6)MobileCommerceDaily

• Weakproductivitygrowth,risingwagesandsluggishdemandareputtingpressureonUScompaniesandincreasingthelikelihoodthattheywillslowhiring,cutspendingandfurtherweakentheeconomy.

• Laborproductivityfellata0.6%annualrateinthefirstquarter,accordingtotheUSDepartmentofLabor.Strongproductivityincreasescorporateprofits,givingmoremoneytoworkersinturn.Productivityhasgrownby2.2%onaverageannuallysinceWorldWarII,buthasgrownbyonly0.5%overthelastfiveyears.

EUROPERETAILEARNINGS

Company

Revenues(USDMil.)

ChangeinUSD(%)

ChangeinReportingCurrency

(%)Gross

Margin(%)Change(bps)

NetIncome(USDMil.)

YoY%Change

StoreFleetEOP

Period 2016 2015

2016 2015

2016 2015

2016 2015

Boohoo.com(BOO.L)

1QEMay31,2016 83.6 63 33.7 40.9 N/A N/A N/A N/A N/A N/A N/A N/A

EUROPERETAILHEADLINESUKRetailSalesRiseinMay(June7)Brc.org.uk

• IntheUK,retailsalesinthefourweeksfromMay1–28grewby1.4%yearoveryear,accordingtotheBritishRetailConsortium(BRC)-KPMGRetailSalesMonitor.BRCCEOHelenDickinsonnotedthatthoughthisgrowthis“notspectacular,itisinlinewiththe12-monthaverageof1.5%.”

• Duringthesameperiod,onlinesalesintheUKgrewby13.7%yearoveryear,astrackedbytheBRC-KPMGOnlineRetailSalesMonitor.

NewLookReportsSolidSalesIncreaseforFY16(June7)Companypressrelease

• BritishfashionretailerNewLookhasreportedrevenuegrowthof5.4%,to£1,490.6million(US$2,249.2million)fortheyearendedMarch26,2016.UKcompswereup3.4%andNewLookbrandcompswereup3.6%.Salesonthecompany’sownwebsitegrewby27.9%andsalesthroughthird-partye-commercesitesgrewby41.8%.

• Whileadjustedpretaxprofitroseby16.8%,to£59.1million(US$89.2million),NewLookreportedapretaxlossof£34.4million(US$51.9million)duetotheone-offcostsofitsMay2015acquisitionbySouthAfricaninvestmentgroupBrait.

NorwegianRaintoOpenFirstInternationalStore(June7)Theretailbulletin.com

• OuterwearbrandNorwegianRainissettoopenitsfirststoreoutsideNorway,inLondon.ThenewshopwillbelocatedonPiccadilly,incloseproximitytothetraditionalsartorialquartersofSavileRow,BondStreetandJermynStreet.

• ThenewstorewillsellNorwegianRain’sfullcollectionofclothing,suitsandshoes;leatheritemsfromtheT-Michaellabel;andScandinavianfurniture.

ElCorteInglésOpensStoreDedicatedtoWomen’sProducts(June6)Wgsn.com

• SpanishretailchainElCorteIngléshasopenedastorededicatedentirelytowomen’sproductsinMadrid’sCalledeSerrano,thepreferredlocationforsomeofEurope’sbest-

5

June 10, 2016

DEBORAHWEINSWIG,MANAGINGDIRECTOR,FUNGGLOBALRETAIL&TECHNOLOGYDEBORAHWEINSWIG@FUNG1937.COMUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2016TheFungGroup.Allrightsreserved.

knownbrandsinthecity.ThismovefollowsthesuccessofitsSerrano52MANstore,whichopenedonthesamestreetlastyear,cateringexclusivelytomen.

• Thenewstorehassixfloorsofwomenswearandaccessories,andincludesseveralbrandsthatarenewtotheretailer’soffering.

Matalan’sPerformanceinFY16DropsonWarehouseChallenges(June6)Companypressrelease

• BritishclothingretailerMatalanannouncedthatrevenuesfellby3%,to£1,061.4million(US$1,608.3million)fortheyearendedFebruary27,2016.EBITDAfellby44%,to£56.2million(US$85.2million).

• ManagingDirectorJasonHargreavescited“operationalchallengesencounteredwithlastyear’swarehousetransition”asthecauseoftheperformancedecline.Headdedthatthewarehouseisnowoperationallystableandthatthecompanyhasacautiousrecoveryplaninplaceforthecomingyear.

ASIATECHHEADLINESChineseConsumersLeadtheWorldinPayingwithTheirPhones(June7)TechinAsia

• AccordingtoeMarketer,195millionpeopleinChinawillbeusingtheirphoneasawalletbytheendof2016.Thatrepresents38%ofallsmartphonesusersinthecountry,andisdoubletherateofsmartphonestorepaymentsintheUS.

• TherearethreemainmobilewalletoptionsinChina,WeChat,AlipayandnewcomerApplePay.WhileWeChatandAlipaygenerateaQRcodeforscanning,ApplePaytiesupwithChina’sbiggestcardnetwork,UnionPay,whichmeansApplePayworksateverystorethathasUnionPay’sPIN-inputkeypad.

BelievetheHype?HowVirtualRealityCouldChangeYourLife(June6)TheStarOnline

• Virtualreality(VR)wasthebuzzindustryatAsia’slargesttechfair,Computex,heldinTaiwan’scapitalofTaipeilastweek.TheislandishopingtobecomeadevelopmenthubforVRtechnology.

• HTCisamongthemajortechfirms,includingFacebookandSamsung,thathavelatchedontotheimmersiveexperienceplatformofVR,andHTChasalreadybranchedoutintothemedicalsector.Lastyear,thecompanyinvestedinaUSstartupthatusesVRtohelpsurgeonsplancomplicatedbrainoperations.E-commerceisanotherindustrythatholdsmuchpotentialforVRutilization.

LINEAppLookstoBuildonAsianPopularitywithOneoftheYear’sBiggestTechIPOs(June6)AsianCorrespondent

• LINE,aJapanesesubsidiaryofSouthKoreanInternetsearchgiantNaverandoneofAsia’smostpopularmessagingservices,planstoopenitssharestothepublicinTokyoandNewYorkthisJuly.ThecompanyaimstoraiseUS$1–US$2billionatavaluationofUS$5–US$6billion.

• Thefirm’stotalreportedrevenuein2015wasmorethanUS$1billion(¥120billion),up40%fromthepreviousyear.Thefirmisgetting35%ofitsrevenuefromadvertisers,while“stickers,”whichcountascommunications-relatedproducts,arecontributing22%ofitsrevenue.

MalaysianFitnessStartupKFitAcquiresGrouponIndonesia(June6)TechinAsia

• MalaysianfitnessstartupKFitissuedastatementthatithassignedadealtoacquireGrouponIndonesiaforanundisclosedamount.GrouponIndonesiawillbecomeawhollyownedsubsidiaryofKFit,whileGrouponInc.willbecomeastrategicshareholderofKFit.

6

June 10, 2016

DEBORAHWEINSWIG,MANAGINGDIRECTOR,FUNGGLOBALRETAIL&TECHNOLOGYDEBORAHWEINSWIG@FUNG1937.COMUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2016TheFungGroup.Allrightsreserved.

• KFithasalreadymadeotherstrategicmovesin2016.InFebruary,itaddedmorecategories,suchasmassagesandbeautysalons,toitsoffering,anindicationthatitneededtoaddmorerevenuestreamstoitscoreproduct.InMarch,KFittweakeditsmodelbylimitingmembershipto10activitiespermonthforthesamerate.

China’sBitautoRaisesUS$300Million;Baidu,JD.comandTencentEachChipinUS$50Million(June6)TechCrunch

• Bitauto,whichoperatesagiantcarmarketplacethatisdescribedasCars.com,ConsumerReportsandAutotrader.comrolledintooneandalsoinvestsintransportationstartups,hasannouncedafundraisingroundof$300million.

• ThepubliclytradedcompanyisvaluedataroundUS$1.4billion,andisprofitable,withrevenuesfromadvertising,subscriptions,transactionsandmarketing.

LATAMRETAILHEADLINESNewMexicanTextile,ApparelImportRulesHitUSBrands(June7)WWD.com

• Mexicolaunchedanexpandedlistofreferencepricesfortextilesandgarments,causingconcernsamongUSapparelmanufacturers,whoclaimthenewschemehamperstrade.TherulescouldpromptAmericanproducerstosourceelsewhere.Thecurrentimportsystemisunderreview.

• Mexico’stextileandapparelindustryisexpectedtogrowby5%in2016,whiletheUS’smarketsharecontinuestodeclineasCentralAmericanandAsianrivalswinneworders.

InteractivePinterestPinsLetShoppersinBrazilBringOfflineItemsOnline(June4)DigitalTrends

• PinteresthaspartneredwithBraziliandesignerfurnitureretailerTok&StoktocreateasystemcalledPinlistthatallowsshopperstosavein-storeitemstotheirPinterestboards.ThePinlistappturnsthein-storebuyingexperienceintosomethingsocialbyintegratingthevirtualworld.

• Tok&Stokhasequippedhundredsofin-storeitemswithphysicalPinterest“Pins”thatcustomerscanpushinordertosendaBluetoothsignaltotheirphonesand“pin”theitemtotheirPinterestboards.

AppleBeginsHiringfor“Several”MexicanAppleStores(June7)AppleInsider

• ApplelistedaplethoraofjobopeningsforseveralstoresinMexico,despitehavingyettolaunchitsfirststoreinthecountry.Thecompanyissearchingtofillpositionsatmultipleundisclosedlocations.

• InJanuary,AppleconfirmedplansforastoreinMexicoCity’sCentroSantaFeMall,buthasnotcommentedonanyrumorsofadditionalstores.ItisrumoredthatAppleisplanningasecondMexicoCitylocationasastand-alonestoreinaluxuryshoppingdistrict,alongwithstoresinGuadalajaraandMonterrey.

FEMSAComercioEntersConvenienceStoreSpaceinChile(June6)Marketwired

• FEMSAComercioannouncedthatithasacquiredBigJohn,aleadingconveniencestoreoperatorbasedinSantiago,Chile.Therearecurrently49BigJohnretaillocations,mostlyintheSantiagometropolitanarea.

• FEMSAalreadyoperatesseveralsmall-formatretailchainsinMexico,ChileandColombia,includingOXXOconveniencestores;YZA,Farmacon,ModernaandCruzVerdedrugstores;andMaicaobeautystores.

7

June 10, 2016

DEBORAHWEINSWIG,MANAGINGDIRECTOR,FUNGGLOBALRETAIL&TECHNOLOGYDEBORAHWEINSWIG@FUNG1937.COMUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2016TheFungGroup.Allrightsreserved.

Brazil’sInflationAcceleratesMorethanForecastinMay(June8)Bloomberg

• Brazil’sconsumerinflationacceleratedmorethananalystshadforecastedinMay,asthemarketexpectsthecentralbanktokeepinterestratesatthesamelevelforaseventhconsecutivemeeting.

• TheConsumerPriceIndexclimbed0.78%aftera0.61%increaseinApril;theforecastedmedianwas0.75%.The12-monthcumulativeinflationratewas9.32%.

EARNINGSCALENDAR

E=estimated

Company

EarningsReleasePeriod Date

Sales(Mil.) EPS

CurrencyConsensusTY LYActual ConsensusTY LYActual

Prada(1913.HK) 1Q17 Jun13(E) 781 828 0.02 0.02 EUR

Inditex(ITX.MC) 1Q17 Jun15 4,878 4,374 0.18 0.17 EUR

Kroger(KR) 1Q17 Jun16 34,735 33,051 0.69 0.64 USD

PoundlandGroup(PLND.L) FY16 Jun16 1,314 1,117 0.09 0.15 GBP

RiteAid(RAD) 1Q17 Jun16 8,242 6,648 0.04 0.02 USD

H&M(HM-B.ST) 2Q16 Jun22 48,495 45,867 3.61 3.90 SEKFinishLine(FINL) 1Q17 Jun24(E) 451 443 0.23 0.30 USDNike(NKE) 4Q16 June28 8,296 7,779 0.48 0.49 USDWalgreensBootsAlliance(WBA) 3Q16 Jul6 29,717 28,795 1.13 1.29 USD

SimonPropertyGroup(SPG) 2Q16 Jul7 1,347 1,349 2.62 2.63 USD

FastRetailing(9983.JP) 3Q16 Jul8(E) 423 398 180 271 JPYAlimentationCouche-Tard(ATD-B.TO) 4Q16 Jul14(E) 8,297 7,286 0.39 0.26 USD

SuperGroup(SGP.L) FY16 Jul14 581 487 0.69 0.60 GBP

Apple(AAPL) 3Q16 Jul19(E) 42,140 49,605 1.40 1.85 USD

eBay(EBAY) 2Q16 Jul20(E) 2,172 4,379 0.42 0.59 USD

Alphabet(GOOGL) 2Q16 Jul21(E) 16,848 17,727 8.05 4.99 USD

Amazon(AMZN) 2Q16 Jul21(E) 29,573 23,185 2.47 0.19 USD

Macerich(MAC) 2Q16 Jul21(E) 255 323 0.98 0.89 USD

Skechers(SKX) 2Q16 Jul21(E) 894 801 0.53 0.52 USD

UnderArmour(UA) 2Q16 Jul21(E) 1,000 784 0.04 0.03 USD

Unilever(ULVR.L) 1H16 Jul21 26,671 26,991 0.94 0.91 EUR

VFCorp.(VFC) 2Q16 Jul22 2,528 2,514 0.34 0.40 USD

8

June 10, 2016

DEBORAHWEINSWIG,MANAGINGDIRECTOR,FUNGGLOBALRETAIL&TECHNOLOGYDEBORAHWEINSWIG@FUNG1937.COMUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2016TheFungGroup.Allrightsreserved.

EVENTCALENDAR

Event Location Date(s)

FungGlobalPresenting/Attending

NRFRetailLeadersDinner Philadelphia,PA Jun13 QConNewYork NewYork,NY Jun13–17 TechCrunchMeetup+Pitch-Off Austin,TX Jun14 WWDRetail20/20Forum NewYork,NY Jun14 Omni-ChannelRetailingConference HongKong Jun14–15 NRFProtect Philadelphia,PA Jun14–16 E32016 LosAngeles,CA Jun14–16 RetailAsiaExpo HongKong Jun14–16 √DisruptorsBreakfast NewYork,NY Jun15 √BRCAnnualRetailLecture London,UK Jun15 IdeasLosAngeles–TelAvivUniversityAmericanFriends LosAngeles,CA Jun15–16 SAPAutomotiveForum Stuttgart,Germany Jun15–16 ULIAsiaPacSummit Shanghai,China Jun15–17 ICSCQuebecConference Montreal,Canada Jun15–17 MGMAnalystandInvestorDay LasVegas,NV Jun16 PepcomDigitalExperience!SummerKickoff NewYork,NY Jun16 TechCrunchMeetup+Pitch-Off Seattle,WA Jun16 InnovationEnterpriseBigData&AnalyticsforRetailSummit Chicago,IL Jun16–17 InnovationEnterpriseCustomerAnalyticsInnovationSummit Chicago,IL Jun16–17 BrainXchange:EnterpriseWearableTechnologySummitEast Atlanta,GA Jun16–17 ArtBaselShow Basel,Switzerland Jun16–19 FutureStores Seattle,WA Jun20–23 FMIConnect Chicago,IL Jun20–23 Velocity SantaClara,CA Jun20–23 TechweekChicago Chicago,IL Jun20–26 LondonTechWeek London,UK Jun20–26 FutureLeaders@Connect Chicago,IL Jun21–23 HKIoTConference2016 HongKong Jun21 √InternationalGameTechnologyAnalystDay Rome,Italy Jun21–22 CEWeekNewYork NewYork,NY Jun21–23 eTailEurope London,UK Jun21–23 20thAnnualConsumerTechnologyCEOSummit TelAviv,Israel Jun21–24

9

June 10, 2016

DEBORAHWEINSWIG,MANAGINGDIRECTOR,FUNGGLOBALRETAIL&TECHNOLOGYDEBORAHWEINSWIG@FUNG1937.COMUS:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2016TheFungGroup.Allrightsreserved.

DeborahWeinswig,CPAFungBusinessIntelligenceCentreNewYork:917.655.6790HongKong:852.6119.1779China:86.186.1420.3016deborahweinswig@fung1937.comAmandaByrneMarketingAssociate

RachaelDimitResearchAssociate

JohnHarmon,CFASeniorAnalyst

AragornHoResearchAssociate

JohnMercerSeniorAnalyst

KirilPopovSeniorAnalyst

StevenWinnickResearchAssociate

HONGKONG:10thFloor,LiFungTower888CheungShaWanRoad,KowloonHongKongTel:85223002470NEWYORK:1359Broadway,9thFloorNewYork,NY10018Tel:6468397017LONDON:242–246MaryleboneRoadLondon,NW16JQUnitedKingdomTel:44(0)2076168988

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