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  • 1. Arezzo&Co Investor Day Financial Presentation Thiago Borges CFO
  • 2. Notes: 1. Women’s footwear market in Brazil; Source: Euromonitor. Chart base 100= 2009 2. Based on Euromonitor research and IBOPE Inteligência (Pyxis). Estimate of Arezzo&Co market share for the women’s footwear market Growth: Arezzo&Co Sell-out Net Sales Vs. Market 2 Leader in the women shoe industry, growing 4x faster than the domestic market growth in the last 4 years 4% growth in Market Share over the last 5 years Financial Performance Solid growth history Arezzo&Co Market Share² Evolution 28,4% 33% Market CAGR Arezzo&Co CAGR 8% 44.2% 101.9% 144.6% 210.9% 13.9% 31.8% 29.8% 36.5% 2009 2010 2011 2012 4.3x Arezzo&Co (invoice sell-out) Market¹
  • 3. 8,4% Notes: 1. The adjustments to the EBITDA figures for 2012 and 1H2012 relate to the extraordinary expense of R$8 million incurred in changing a sourcing agent. This expense is shown in Income, net of tax effects. 3 Solid growth has been sustainably executed with maintenance of high margins Financial Performance Maintenance of high margins EBITDA (R$ MM) and EBITDA Margin (%) Evolution 48,5% 57,7% 23,3% 22,1% 20,6% Net Income (R$ MM) and Net Margin (%) Evolution 118,3% 32,4% 42,0% 11,5% 15,6% 41 61 95 118 144 57 69 11.1% 14.7% 16.7% 17.3% 16.7% 15.9% 15.8% EBITDA Margem EBITDA 48.5% 57.7% 23.3% 22.1% 22 49 65 92 102 42 48 6.1% 11.8% 11.3% 13.5% 11.9% 11.6% 11.0% Lucro Líquido Margem Líquida 15.6% EBITDA Margin Net Profit Net Margin
  • 4. Notes: 1. Includes Anacapri, Alexandre Birman, and the exports market 2. Includes the exports market and other revenues from the domestic market 4 Diversification of revenues by brand and by channel strengthens the business model Financial Performance Diversified Revenues Sales by Brand Breakdown Sales by Channel Breakdown Other Brands
  • 5. 21.4% 24.8% 28.2% 27.4% 23.3% 25.4% 78 90 103 100 81 97 9 8 23 37 21 7 2 6 6 18 10 12 2 1 2 2 11 16 30 57 32 20 Lojas (Expansão e Reformas) Corporativo Outros 5 Financial Performance 2011 – 2013: Period of investment Major investments in recent years to maintain Company growth, especially on the owned store model CAPEX (R$ MM) Working Capital (% of Revenues and Turnover in days) 1.9x 1.9x Days of working capital
  • 6. Changes in ROIC 2009 2010 2011 2012¹ CAGR (+) EBIT 59 93 114 136 32.3% (-) Income & Social Contribution Taxes -10 -25 -34 -39 Proforma NOPLAT 49 68 80 97 25.7% (+) Working Capital 88 142 192 236 38.7% (+) Permanent Assets 23 36 61 109 66.9% (+) Other Non-Current Assets 22 8 7 8 Capital Employed (End of Year) 134 186 260 353 Capital Employed (Average) 122 160 223 306 35.8% ROIC 39.9% 42.5% 35.8% 31.6% 6 Financial Performance Level of ROIC Level of ROIC reflects the Company’s significant investments in recent years Notes: 1. NOPLAT for 2012 has been adjusted for the impact of an extraordinary expense of R$8 million incurred in changing a sourcing agent, net of tax effects.  CAPEX for opening owned stores, strengthening the logistics structure, IT, etc., and the increase in working capital, affected the level of capital employed by the Company, temporarily reducing its profitability indicators (ROIC).  The solid structure resulting from these investments will reinforce the Company’s growth in the years ahead, and profitability indicators will rise again.
  • 7. Fonte: Arezzo&Co. Escala ilustrativa # Owned Stores # Franchises 365 3T13 2013 55 420 334 2012 56 390 31 29 394 55 449 58 2014 464 43 507 +8% +7% +13% 7 -1  Increase in 2013 guidance for net openings of 59 stores, particularly as a result of the Anacapri brand expansion project with 10 franchises in 2013  In 2014 the Company will maintain its pace of openings with a total of 58 planned stores  Considering Anacapri roll-out in the franchise channel and following the multichanel strategy, in 2014 the Company plans to convert12 owned stores into franchises 12 -12 # Conversion Expansion Plan Guidance update 2013 and 2014