Folli Follie S.A.

Annual Report • Sep 25, 2015

Company name: FOLLI-FOLLIE AE Registered Office: 23rd Km Athens - Lamia National Road - Ag. Stefanos

Supervisory Authority: MINISTRY OF DEVELOPMENT/General Secretariat of Commerce, Societes Anonymes of the Ministry of Development Board of Directors: Dimitrios Koutsolioutos - Georgios Koutsolioutsos Aikaterini Koutsolioutsou - Zaharias Mantzavinos Elias Kouloukountis - Haralambos Papadopoulos Closing Date of Current Year: 31 December 2005 Auditing Company: SOL S.A. Certified Public Accountants Auditors ASSOCIATED CERTIFIED PUBLIC ACCOUNTANTS Certified Public Accountant Auditor: Dimitrios I. Iakovidis Type of Auditors' Report: Unqualified

Date of Approval

of Annual Financial Statements (from which this data has been extracted): 15 March 2006

Internet address: www.follifollie.com

to equity holders of the Company (b) 156.127.921,18 91.298.238,92 109.329.437,59 0,00 101.349.048,11

Minority interest (c) 5.844.540,04 4.609.823,37

Total Equity (d) = (b)+(c) 161.972.461,22 95.908.062,29 109.329.437,59 101.349.048,11 TOTAL EQUITY AND LIABILITIES (e) = (a)+(d) 334.791.355,89 259.804.534,93 245.506.668,23 234.289.097,15

THE GROUP 1/1-31/12/2005 1/1-31/12/2004 Cash Flows related to Operating Activities Net Profit before taxes 70.054.581,57 66.201.485,91 Adjustments in respect of non-cash transactions: Depreciation and Amortisation 3.082.378,44 3.392.365,17 Provisions 1.188.610,09 516.389,20 Cash flows from investing activities -11.528.844,11 -13.060.830,09 Debit interest and similar expenses 4.724.103,21 5.175.940,72 Operating profit before adjustments of working capital 67.520.829,20 62.225.350,91 Decrease/(increase) of Inventories -21.232.011,83 -9.512.471,48 Decrease/(increase) of Receivables -28.318.885,55 -15.465.992,28 Increase/(decrease) of payable accounts (except Banks) 2.751.752,10 -4.598.435,14 Interest paid and similar expenses -5.148.235,89 -5.462.893,07 Income Tax paid -11.332.373,00 -10.028.849,01 Net cash inflows/(outflows) from Operating Activities 4.241.075,03 17.156.709,93 Cash Flows related to Investing Activities	THE COMPANY 1/1-31/12/2005 1/1-31/12/2004 18.788.999,81
				THE GROUP			THE COMPANY
				31/12/2005	31/12/2004	31/12/2005	31/12/2004
			ASSETS
		13.950.886,10	Tangible Assets	29.269.571,73	20.297.157,41	17.175.960,39	16.178.310,13
			Investments in PPE	15.380.000,00	13.833.101,12	15.380.000,00	13.833.101,12
	949.794,62	982.516,88	Intangible Assets	4.185.089,70	4.842.688,58	750.442,44	873.322,82
	854.320,94	215.416,00	Investments in associates	40.395.445,88	40.296.399,36	159.505.501,95	157.732.962,56
	-12.083.378,02	-8.132.250,54	Deferred income tax assets	2.660.750,50	2.708.904,28	703.225,42	889.063,28
	4.668.063,61	4.433.504,84	Other long term receivables	6.838.204,67	7.376.012,55	419.574,43	230.891,87
	13.177.800,96	11.450.073,28	Total non-current assets (a)	98.729.062,48	89.354.263,30	193.934.704,63	189.737.651,78
	-2.703.139,87	-1.168.287,20	Inventories	71.758.888,21	46.715.326,33	14.134.365,54	11.931.225,67
	-5.921.292,33	2.755.388,29	Trade Receivables	121.290.148,36	82.543.791,12	18.872.475,88	12.872.890,96
	1.573.232,40	-6.122.812,41	Other Receivables	6.199.578,58	4.702.838,51	2.395.951,33	2.473.060,31
	-4.950.020,20	-4.641.545,26	Other financial assets at fair value through profit or loss	2.921.508,63	2.764.756,74	2.921.508,63	2.764.756,74
	-1.950.571,40	-991.294,75	Cash and cash equivalents	33.892.169,63	33.723.558,93	13.247.662,22	14.509.511,69
	-773.990,44	1.281.521,95	Total current assets (b)	236.062.293,41	170.450.271,63	51.571.963,60	44.551.445,37
			TOTAL ASSETS (a) + (b)	334.791.355,89	259.804.534,93	245.506.668,23	234.289.097,15
Acquisition of subsidiaries, associates and other investments	-1.772.539,39	-1.555.512,00
Purchases of tangible and intangible assets -10.272.671,44 -12.238.235,89	-1.982.571,72	-11.845.985,40	LIABILITIES
Proceeds from sale of tangible and intangible assets 95.690,76 766.642,72	12.007,22	682.642,72	Non-current liabilities
Proceeds from sale of financial assets 643.044,41 13.696,72	643.044,41	13.696,72	Long-term borrowings	125.149.592,17	120.135.587,74	119.499.958,91	119.499.958,91
Dividends received 9.164.303,46 7.800.000,00	9.735.942,50	8.128.542,08	Retirement benefit obligations	3.356.944,74	3.068.805,44	540.126,00	482.542,29
Interest received 424.132,68 286.952,35	281.956,59	208.040,42	Deferred income tax liabilities	1.047.943,78	495.035,15	1.035.080,14	486.325,90
Decrease/(increase) of other long-term receivables 1.272.691,65 -2.911.833,46	-42.682,56	21.852,98	Provisions for other liabilities and charges	4.054.878,43	3.542.063,70	698.272,82	836.873,79
Net cash inflows/(outflows) from Investing Activities 1.327.191,52 -6.282.777,56	6.875.157,05	-4.346.722,48	Total non-current liabilities	133.609.359,12	127.241.492,03	121.773.437,87	121.305.700,89
Cash Flows related to Financing Activities			Current liabilities
Cash received from issue of share capital			Trade payables	15.829.100,60	13.252.975,46	3.487.817,55	2.203.405,10
Proceeds from borrowings 1.010.172,79 7.122.287,74		9.301.367,57	Short-term Borrowings	5.047.457,92	5.252.135,03	4.863.495,62	4.891.100,49
Repayment of borrowings	-27.604,87		Other current liabilities	18.332.977,03	18.149.870,12	6.052.479,60	4.539.842,56
Payments for leases -632.199,66 -852.913,60	-123.547,81	-118.039,99	Total current liabilities	39.209.535,55	36.654.980,61	14.403.792,77	11.634.348,15
Dividends paid -8.069.321,96 -4.304.785,55	-7.211.863,40	-4.304.785,55	Total Liabilities (a)	172.818.894,67	163.896.472,64	136.177.230,64	132.940.049,04
Net cash inflows/(outflows) from Financing Activities -7.691.348,83 1.964.588,59	-7.363.016,08	4.878.542,03	EQUITY
Net increase/(decrease) in cash and cash equivalents -2.123.082,28 12.838.520,96	-1.261.849,47	1.813.341,50	Share capital	9.884.062,50	9.884.062,50	9.884.062,50	9.884.062,50
Cash and cash equivalents at the beginning of the year 33.723.558,93 23.524.369,13	14.509.511,69	12.696.170,19	Share premium	62.531.731,47	62.531.731,47	62.531.731,47	62.531.731,47
Effect of exchange rate changes on cash and cash equivalents 2.291.692,98 -2.639.331,16			Other reserves	24.513.525,66	23.017.890,72	19.679.018,84	19.679.018,84
Cash and cash equivalents at the end of the year 33.892.169,63 33.723.558,93	13.247.662,22	14.509.511,69	Retained earnings	161.106.539,24	115.624.130,22	17.234.624,78	9.254.235,30
			Exchange differences	-12.980.009,96
ADDITIONAL DATA AND INFORMATION			Other capital and reserves attributable to equity holders of the Company	-88.927.927,73	-30.831.648,26 -88.927.927,73

1/1-31/12/2005 1/1-31/12/2004 1/1-31/12/2005 1/1-31/12/2004

Sales Revenue 222.796.934,45 194.626.963,86 36.980.835,86 35.775.815,91 Cost of goods sold -88.446.212,13 -77.641.874,54 -12.905.798,37 -11.882.386,88 Gross profit 134.350.722,32 116.985.089,32 24.075.037,49 23.893.429,03 Other operating income 6.066.792,76 4.200.812,41 4.643.121,97 1.735.242,46 Administrative expenses -11.586.965,70 -9.470.922,70 -4.793.128,43 -3.768.089,52 Selling and marketing costs -61.797.910,10 -50.773.264,46 -10.346.725,55 -9.486.425,95 Other expenses -2.556.704,96 -2.622.250,46 -792.398,81 -1.624.509,97 Operating profit 64.475.934,32 58.319.464,11 12.785.906,67 10.749.646,05

			RELATION		UN-AUDITED	Finance costs - profit	1.331.144,45	3.534.084,78	1.188.934,36	241.274,85
			REGISTERED % PARTICIPATION THAT COMMANDED CONSOLIDATION		TAX	Finance costs - expenses	-5.148.235,89	-5.462.893,07	-4.857.480,26	-5.169.416,88
COMPANY	OFFICE	PARENT	THE CONSOLIDATION	METHOD	YEARS	Share of profit of associates	9.395.738,69	9.810.830,09	9.671.639,04	8.129.382,08
						Profit before taxes (EBT)	70.054.581,57	66.201.485,91	18.788.999,81	13.950.886,10
FOLLI FOLLIE A.E.	ATHENS	-	-		2005	Income tax expense	-13.391.086,52	-12.004.215,98	-3.360.297,83	-2.220.029,99
FOLLI FOLLIE HONG KONG LTD	HONG KONG	99,99%	Direct	Full	1999-2005	Profit for the period (after taxes)	56.663.495,05	54.197.269,93	15.428.701,98	11.730.856,11
FOLLI FOLLIE UK LTD	LONDON	99,99%	Direct	Full	2004-2005	Attributable to:
FOLLI FOLLIE FRANCE SA	PARIS	99,94%	Direct	Full	2003-2005	Equity holders of the Company	55.428.778,38	52.503.238,03	15.428.701,98	11.730.856,11
FOLLI FOLLIE SPAIN SA	MADRID	100%	Direct	Full	2002-2005	Minority interest	1.234.716,67	1.694.031,90
FOLLI FOLLIE CZECH SRO	PRAGUE	100%	Direct	Full	2001-2005	Earnings (after taxes) per share - basic (expressed in €)	1,68	1,59	0,47 0,00	0,36
FOLLI FOLLIE POLAND SZOO	WARSAW	100%	Direct	Full	2001-2005	Amortisation - Depreciation	3.082.378,44	3.392.365,17	949.794,62	982.516,88
FOLLI FOLLIE SLOVAKIA SRO	BRATISLAVA	100%	Direct	Full	2001-2005	Earnings (profit) before taxes, financing and investing results
FOLLI FOLLIE GERMANY Gmbh	TRAOUNSTAIN	100%	Direct	Full	2005	and depreciation - amortisation (EBITDA)	67.558.312,76	61.711.829,28	13.735.701,29	11.732.162,93
MFK FASHION INV. Ltd.	LIMASSOL	100%	Direct	Full	2002-2005	Earnings (profit) before taxes, financing and investing results (EBIT)	64.475.934,32	58.319.464,11	12.785.906,67	10.749.646,05
FOLLI FOLLIE JAPAN LTD	TOKYO	40%	Direct	Full	2001-2005	Proposed dividend per share (expressed in €)			0,26	0,22
FOLLI FOLLIE ASIA LTD	HONG KONG	99,99%	Indirect	Full	2001-2005
FOLLI FOLLIE TAIWAN LTD	TAIPEI	99,99%	Indirect	Full	2004-2005	DATA FROM STATEMENT OF CHANGES IN EQUITY FOR THE YEAR
FOLLI FOLLIE KOREA LTD	SEOUL	99,99%	Indirect	Full	2003-2005	Amounts reported in Euro
FOLLI FOLLIE SINGAPORE LTD	SINGAPORE	99,99%	Indirect	Full	2004-2005
BLUEFOL GUAM LTD	GUAM	99,99%	Indirect	Full	1999-2005		THE GROUP		THE COMPANY
BLUEFOL HAWAII LTD	HAWAII	99,99%	Indirect	Full	2000-2005		31/12/2005	31/12/2004	31/12/2005	31/12/2004
BLUEFOL HONG KONG LTD	HONG KONG	99,99%	Indirect	Full	2001-2005	Net equity of period
FOLLI FOLLIE MALAYSIA LTD	KUALA LUMPUR	99,99%	Indirect	Full	2004-2005	Opening Balance (1/1/2005 and 1/1/2004 respectively)	95.908.062,29	61.358.862,48	101.349.048,11	95.548.629,50
BLUEFOL THAILAND LTD	BANGKOK	99,99%	Indirect	Full	2001-2005	Issue of share capital	0,00	0,00	0,00	0,00
HELLENIC DUTY FREE SHOPS	ATHENS	24,68%	Direct	Net Equity		Distribution of dividend based on resolution of G.M.	-8.125.853,46	-6.854.401,50	-7.248.312,50	-5.930.437,50

Directors' fees -326.541,80 0,00 -200.000,00 0,00

Change in participation percentage-Change in consolidation method 1.660,89

Net income recognised directly in equity 0,00 0,00 Profit for the period, after taxes 56.663.495,05 54.197.269,98 15.428.701,98 11.730.856,11 Adjustment in foreign currency translation differences 17.851.638,25 -12.793.668,67 0,00

Net equity of period Closing Balance

(31/12/2005 and 31/12/2004 respectively) 161.972.461,22 95.908.062,29 109.329.437,59 101.349.048,11

GEORGIOS D. KOUTSOLIOUTSOS GEORGIOS D. ALAVANOS H.E.C. Licence No. 0008211/A' Class

"FOLLI - FOLLIE" AE

Companies Register No. 18989/06/B/89/17

CONDENSED FINANCIAL DATA AND INFORMATION FOR THE YEAR FROM 1 JANUARY 2005 TO 31 DECEMBER 2005

(Published according to L. 2190, article 135 for enterprises that prepare annual financial statements, consolidated and unconsolidated, according to International Financial Reporting Standards - IFRS)

ID.No. Ξ 433750 ID.No. Ρ 520955 ID.No. Η 159150 ID.No. Κ 004406

THE VICE CHAIRMAN OF THE B. OF D. THE HEAD OF ACCOUNTS DEPT. THE FINANCE - TAX ADVISOR

DATA FROM INCOME STATEMENT FOR THE YEAR

Amounts reported in Euro

THE GROUP THE COMPANY

	Ag. Stefanos, 16/03/2006

THE CHAIRMAN OF THE BOARD OF DIRECTORS

DIMITRIOS G. KOUTSOLIOUTSOS

IOANNIS D. ZANNOS

The following data and information aim at providing a general knowledge for the financial position and the results of operations of "FOLLI - FOLLIE" A.E. Therefore, it is recommended, the reader who seeks to have an overview of the financial position and results of the company, before proceeding to any kind of investment decision or other transaction with the Company, must visit the Company's web site, at the internet address www.follifollie.com where are posted the Annual Financial Statements prepared according to the International Financial Reporting Standards accompanied with the Auditors' Report of the Certified Public Accountant

1. The same Accounting Policies have been followed as for the Balance Sheet at 31.12.2004. The Group applies the IFRS from 1 January 2005.

2. There are no real liens on non-current assets or property.

3. There are no disputed or under arbitration cases of national or administrative courts that may have a material effect on the financial position of the Company.

4. The personnel employed in the Group, as at 31.12.2005, amounted to 912 and in the Company to 276 persons.

5. The amounts of Purchases and Sales of the Company, to and from the related parties as these are defined in IAS 24, accumulatively from the opening balance of the period 1.1.2005 to 31.12.2005 amount to € 1.414.121,63 and € 12.959.253,70, respectively. The receivables and payables balances of the above Companies, as at

31.12.2005, amount to € 11.658.616,94 and € 7.773,76 respectively.

6. The year's consolidation amounted to: a) for the Group, € 9.198.514,84 and b) for the Company, € 84.064,93.

7. For the un-audited tax years of the parent company and its subsidiaries where the possibility exists for tax audit differences to arise it has been performed a relative provision.

8. The Company at 14.7.2005 acquired the remaining 60% of the company MFK FASHION INV. Ltd. Thus, its financial data has been incorporated as of 31.12.2005 by the full consolidation method for the after the above-mentioned time period. The effect of this change was insignificant.

9. In the consolidated financial statements are included the following companies: