Charles Vgele Group

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Charles Vögele Group
Welcome to the

• Analyst Presentation
• Half-Year Results 2004

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Members of Charles Vögele Management

• Daniel ReinhardChief Executive Officer
• Dr. Felix ThöniChief Financial Officer
• Renzo RadiceHead Corporate Communications
  Investor Relations

Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Programme

• Analyst presentation half-year results 2004
• 13.30 Presentation half-year results 2004
• 14.30 Questions and answers
• 15.00 Apéritif
• 15.45 End

Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
4
Agenda

• Goals and achievements first half-year 2004
• Financial results first half-year 2004
• Outlook and summary
• Question and answers

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Strategy implementation unchanged

• Events in the first half-year 2004
• Inventory of current and previous seasons reduced
  by over CHF 10 million as compared to 31st
  December 2003
• Gross profit margin again improved to 60
• Existing syndicated loan contract successfully
  renewed by a CHF 325 million three to five year
  financing scheme
• Positive net profit despite lower net sales in
  the first semester
• Correction of earnings forecast to CHF 100
  million CHF 130 million by the end of the year
  (according to press release of 30th June 2004)

Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
6
Earnings below expectations

• Goal as per End 2004
• Maintain earnings EBITDA at the previous years
  level of CHF 172 million despite slight decline
  in net sales
• Forecast has been revised on 30th June 2004 due
  to sales development in May and June and set to a
  target range of CHF 100 million CHF 130 million
  at the end of the year.

Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
7
Inventory reduced according to plan

• Goal as per end 2004
• Reduce inventory of current and previous seasons
  by CHF 30.0 million.
• Inventory as per

Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
8
Net debt reduced further

• Goal as per end 2004
• Reduce net debt to below CHF 200.0 million
• Due to the development of earnings in the first
  semester this goal will not be achieved.
  Nevertheless, net debt will be reduced below the
  previous years level of CHF 282.0 million (as of
  December 31st 2003)
• Net debt as per

Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Net debt since 2000
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
Net debt in CHF million
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Financing secured until 2009

• Former syndicated loan until August 2005
• Total credit lines CHF 577.5 million
• Total pay back 2003 CHF 177.5 million
• Total pay back 2004 CHF 25.0 million
• Credit lines until August 2004 CHF 375.0 million
• New syndicated loan August 2004 - August 2009 as
  early substitution of former loan agreement
• Total credit lines CHF 325.0 million
• Credit lines until August 2007 CHF 162.5 million
• Credit lines until August 2009 CHF 162.5 million

Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Different performances in different countries

• EBITDA

Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Switzerland battles shrinking market environment
Key figures Swiss sales organisation
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Market share increased in Switzerland
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
Market share outerware in
1st half-year 2003
1st half-year 2004
Charles Vögele
Competitor
Source Market report (value based) GfK-IHA 2004
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Germany faces fierce competition
Key figures German sales organisation
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Vögele with slight decline in Germany
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
Market share outerware in
1st half-year 2003
1st half-year 2004
Charles Vögele
Competitor
Source Market report (value based) GfK-IHA 2004
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Efforts to keep market share press on margin in
Austria
Key figures Austrian sales organisation
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Austrian market kept at high levels
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
Market share outerware in
1st half-year 2003
1st half-year 2004
Charles Vögele
Competitor
Source Market report (value based) GfK-IHA 2004
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Improvements in Belgium and The Netherlands
Key figures Belgian and Dutch sales organisations
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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The Netherlands with slight decline of market
share
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
Market share outerware in
1st half-year 2003
1st half-year 2004
Charles Vögele
Competitor
Source Market report (value based) GfK-IHA 2004
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Supply Chain Management on track

• All projects on track
• Full impact of the measures on the profit and
  loss account will be reached as of the business
  year 2005 as announced
• Expected savings amount to CHF 10 million per
  annum

Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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External brands concept introduced in pilot
stores

• Goals of the external brands concept
• Improve shopping experience for customers of
  large Vögele stores by presenting additional
  collections
• Clearly structured product presentation through
  high visibility of the individual brands
• Positive image transfer
• Increase of customer loyalty
• Implementation
• Shop-in-the-Shop concept
• Individual local advertising campaigns
• Test period 1-2 years

Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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External brand concept The partners
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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External brand concept The partners
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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External brand concept The partners
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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External brand concept The partners
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Agenda

• Goals and achievements first half-year 2004
• Financial results first half-year 2004
• Outlook and summary
• Question and answers

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Net sales
Group net sales in CHF million
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Margin increased further
Group gross profit in CHF million
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Develpoment gross profit /-margin
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
CHF million /
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Operating costs / nominal
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Operating costs / currency adjusted
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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EBITDA
Group EBITDA in CHF million
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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EBIT
Group EBIT in CHF million
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Development of financial expenses and tax rate
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Group net profit
CHF million
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Cash flow statement
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Cash flow statement / details
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Key figures balance sheet
Group balance sheet
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Development of inventory levels
Group inventory
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Release of inventory provisions
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Key figures balance sheet
Group balance sheet
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Early intake of new collection slightly
increases net debt

• Net debt

Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Equity considerably strenghtened
Financial key figures
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
Based on 12 month rolling
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Equity considerably strenghtened
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
Development of Group equity in
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Development of the Charles Vögele share
Share price development 1.1.2003 20.8.2004
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Information for Investors
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
Key Figures
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Agenda

• Goals and achievements first half-year 2004
• Financial results first half-year 2004
• Outlook and summary
• Question and answers

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No considerable improvement in consumer
confidence expected

• Environment 2004
• Restrained economic growth
• No increase of disposable income for private
  households
• No increase in consumer spending in the textile
  sector

Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers
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Consistently pursue strategy implementation
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers

• Priorities 2004
• Continue strategy implementation according to
  schedule
• Concentrate on implementation of Supply Chain
  Management project
• Further reduce inventory level
• Reduce inventory valuation adjustment due to the
  improved inventory structure
• Further reduce net debt
• Continuously increase profitability and manage
  costs in all subsidiaries

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Operational development 2004
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers

• Sales 2004
• Depending on individual markets, sales
  expectations below 2003
• Overall reduction in sales not as strong as in
  the first semester
• Loss of contribution margins partially
  compensated through improved processes
• Operating result (EBITDA) 2004
• The target range of CHF 100 million CHF 130
  million is confirmed
• Due to the volatility of the market conditions we
  do not communicate a more accurate guidance

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Time-table 2004 / 2005
Introduction Goals and achievements Financial
results HY 2004 Outlook Questions and answers

• 2004
• Media and analyst presentation half-year results
  2004 31st August, 2004
• 2005
• Media and analyst presentation full-year results
  2004 8th March, 2005
• General Shareholders Meeting 2004 13th April,
  2005
• Media and analyst presentation half-year results
  2005 30th August, 2005

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Agenda

• Goals and achievements first half-year 2004
• Financial results first half-year 2004
• Outlook and summary
• Question and answers

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Charles Vögele Group