Matahari Returns to Profitability and Strengthens Board of Directors and Commissioners

PT Matahari Department Store Tbk (“Matahari” or “the Company”; stock code: “LPPF”) reported gross sales of Rp6.6 trillion for the period ended June 30, 2021, 67% above 2020 for the same period. Net income was Rp3.6 trillion, 58% above 2020.

(in billion Rupiah)

Matahari has returned to profitability, with a net profit of Rp533 billion for the first half of 2021. This result was achieved despite homecoming restrictions that affected Eid sales, declining purchasing power, the cancellation of joint leave and several steps taken to protect public health such as reducing operating hours.

Matahari has seen promising progress in the following key operational areas:

• more predictable margins by discontinuing underperforming brands and fashions

• ongoing modernization of merchandise, with a series of new initiatives that have yielded results

• reorganized operating areas for higher productivity

• store improvement work for a smoother shopping experience

• more selective use of capital expenditures for key customer service improvements

• The shift to an asset-light model with reduced warehouses, assets and low-performing assets is going well

The Company believes that its shares have underperformed, and therefore launched a share buyback program in August 2021, for a maximum of 15% of the Company's paid-up and issued capital with the earmarked fund of IDR 450 Billion.

The Company also held the Annual General Meeting of Shareholders (“AGMS”) on 27 August 2021 approved the changes to the Company's Board of Commissioners and Board of Directors structure. The changes were approved by the shareholders in order to support the Company's continuing transformation and growth strategy in 2021 and beyond.

Board of Commissioners:

Board of Directors :

*new

Terry O'Connor, Matahari CEO said, “We are pleased to have returned to profitability and this is a testament to the hard work and perseverance of our employees. We have repaid our debt and had a very healthy cash balance at the end of the period. Therefore, we believe Matahari can perform much better post-PPKM as the implementation of initiatives accelerates and the challenges related to COVID-19 are overcome and we intend to use last season as a key learning for the 2022 Lebaran season. With our people now fully vaccinated, and our strong safety protocols in place, we believe that we are well-positioned to take full advantage of the upcoming recovery in our stores and in achieving our omni-channel ambitions, especially now that all of our stores in Indonesia are 100% open while still following the health protocols and PPKM regulations that apply in their respective regions.”