About LUK HING ENT Company

We are a leading clubhouse and entertainment business operator in Macau, mainly operating Club Cubic in City of Dreams and organizing special events in Cotai, Macau. In 2013/12, Club Cubic was rated as one of the top three institutions in Macau by Travel.CNN.com. In 2014/7, Club Cubic ranked fourth in the “Top Ten Brands in the World” on Forbes Chinese.com. In January 2016, Club Cubic was named the Best Night Club in Hong Kong and Macau by HKClubbing.com in 2015. According to Euromonitor's report, on the last practical date, in terms of total construction area, Club Cubic is the second largest clubhouse-style entertainment venue in Macau. We are committed to building Club Cubic into a high-quality, upscale clubhouse and entertainment venue. According to Euromonitor's report, Club Cubic estimates that the average nightly expenditure per guest is generally higher than other clubhouse-style entertainment venues in Macau as determined by Euromonitor. For details, please refer to the “Industry Overview — Overview of the Operation of Macau Clubhouse Entertainment Venues” section of this document. During the recording period, through our main business, namely (i) our clubhouse business and (ii) our music-related events held at Club Cubic, we generated revenue mainly from drink sales to retail customers and sponsorship revenue received by Club Cubic from the company's customers and beverage suppliers (including Kai Quan and COD), including sponsorship fees charged to the company's customers for displaying the company's logos or products and rewards based on our purchases from beverage suppliers. Beverage sales are the Group's largest product sales segment, accounting for approximately 78.3%, 74.0% and 80.3% of our revenue for the years ended December 31, 2015 and the four months ended April 30, 2016, respectively. Based on our quality and high-end positioning, we mainly promote champagne as our main beverage product, which generally sells for over MOP 1,500 per bottle. According to Euromonitor's report, the market size of the retail sales value of Macau champagne for the year ended December 31, 2015 was 19.6 million US dollars (equivalent to HK$152.5 million). Based on this estimate, our champagne sales accounted for about 35.4% of the retail sales value of champagne consumed on-site in Macau for the year ending December 31, 2015. For the years ending December 31, 2015 and the four months ending April 30, 2016, champagne sales accounted for 55.8%, 58.2% and 62.3% of our beverage sales, as well as 43.6%, 43.0% and 50.0% of our total revenue for the same period. According to Euromonitor, Flower of Paris is a premium champagne brand and one of the three most popular champagne brands in Macau. This champagne is our main product, accounting for 92.3%, 94.5% and 96.9% of our champagne sales for the years ending 2014/12/31 and 2015/4/30 and the four months ending April 30, 2016, respectively. As confirmed by Kai Quan, the exclusive distributor of Flower of Paris Champagne Macau, since Club Cubic opened at its current location in 2011, we have been the largest customer and retail location of Paris Flower Champagne in Macau in terms of (i) number of bottles and (ii) sales volume. This ranking marks our success in turning Club Cubic into a premium high-end clubhouse and entertainment hotspot in Macau.