PPR: A new Group built to outperform

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PPR A new Group built to outperform

• François-Henri Pinault
• Exane BNP Paribas European seminar
• June 8, 2005

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Disclaimer
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Contents

• PPR a new Group
• Robust Q1 2005 sales
• Our strategic priorities

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PPR a global leader in Luxury Goods and Retail

• Outstanding brand portfolio
• Present in 65 countries
• Focus on organic growth, cash flow and return on
  capital employed
• Solid financial structure

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Strong 2004 results in Luxury Goods and Retail

• Sales 17.2 billion (6.7)
• Operating income 1.1 billion (17.7)
• Free cash flow from operations gt 0.5 billion
  (46.8)
• Net financial debt/shareholders equity 58

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Delivering higher profitability and cash flow
(In EUR million)
6.3
6.5
6.0
Operating margin (operating income / sales)
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Robust Q1 2005 Sales
Change

• Luxury Goods 14.4
• Retail 3.6
• PPR 5.3

After adjustment for impact of transition to
IFRS, on a comparable basis (structure, currency
and number of days)
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Our 3 strategic priorities

• Achieve sustained organic growth
• Expand our international presence
• Generate considerable free cash flow

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Strong platform for growthand profitability

• Considerable international growth potential

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A global network
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398 stores in Luxury Goods 409 stores in
Retail 55 home shopping catalogues More than 60
e-commerce sites 272 CFAO facilities
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50
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Target 60 of sales outside of France by 2008
Number of stores or number of catalogues (Redcats)
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Strong platform for growth and profitability

• Two strong, complementary businesses
• Luxury Goods powerful brands with considerable
  global growth potential, generating high overall
  profitability
• Retail attractive retail brands focused on large
  profitable segments outpacing growth in consumer
  spending, providing significant European
  expansion opportunities
• Size and scale a major competitive advantage
• Purchasing
• HR management

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Strong platform for growthand profitability

• Gradual rebalancing

2004 sales
2004 EBIT
Faster growth and higher margins to raise Luxury
Goods contribution
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Luxury Goods diversity driving growth and
profitability profile

• A multi-brand Luxury Goods group built on a
  balanced portfolio
• High-growth brands
• Brands offering access to new territories
• Brands with exceptional long-term growth
  prospects
• Transfer of expertise across brands

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Retail focus on higher-margin, faster-growth
segments

• Two markets Apparel and Lifestyle / Home and
  Leisure
• Four retail formats Department stores,
  high-street stores, out-of-town discount centres,
  home shopping
• Strong synergies

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Retail built strong brands and leading
positions in past decade
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PPR a Group built to outperform

• To sustain a high level of organic growth
• To develop profitably our international
  businesses in Retail
• To improve our ROCE, in particular in Luxury
  Goods
• To deliver a steady, ongoing improvement in free
  cash flow

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PPR A new Group built to outperform

• François-Henri Pinault
• Exane BNP Paribas European seminar
• June 8, 2005