ACCENT GROUP LIMITED — AGM Information 2009

Nov 22, 2009

ABN 85 108 096 251

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23 November 2009

Company Announcements Office Australian Stock Exchange Limited By Electronic Lodgement

Dear Sir,

MARKET UPDATE – ANNUAL GENERAL MEETING

Please find attached a document entitled “Market Update” to be presented at the Company’s Annual General Meeting tomorrow, the 24[th] of November 2009.

Yours faithfully

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Michael Hirschowitz Finance Director & Company

Unit 8, 29 Bridge Road, Stanmore NSW 2048 T +61 2 8594 9222 F +61 2 9550 3573 E info@rcgcorp.com.au All correspondence to: Private Bag 99, Camperdown NSW 1450 W www.rcgcorp.com.au

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Market Update Annual General Meeting 24 November 2009

Table of contents

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2009 Financial year highlights – RCG Group ......... 2
2009 Another year of record profit............................. 3
2009 Financial year highlights – TAF .......................... 4
2009 Another year of record sales............................. 5
Significant transactions since year end:
•
New The Athlete’s Foot licence...................... 6
•
........................ 7
Merrell distribution agreement
•
Shoe Superstore................................................ 8
’
The Athlete s Foot – update & outlook ......................... 9
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1

2009 financial ear hi hli hts y g g

RCG Group

• Group consolidated net profit before tax of $7 . 61m , an increase of 27.5% on the same period in the prior year

• As a result of carried forward tax losses , FY08 effective tax rate was only 18%, resulting in consolidated profit after tax increasing by 7.5%

• Declared a special dividend of 2.2c and an ordinary dividend of 1 . 5 c, o b th f u ll y ran f k e d . Th e paymen t o f th e or di nary di v id en d mar k s the board’s reinstatement a consistent dividend payment policy

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2

2009 – Another ear of record rofit y p

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8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
FY2006 FY2007 FY2008 FY2009
$000’s
Profit in
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3

2009 financial ear hi hli hts y g g

The Athlete’s Foot

• The Athlete’s Foot (TAF) achieved EBITDA of $8 . 33m , which represents an increase of 15.4% on the prior year

• TAF achieved total g rou p sales of $ 166.7m , an increase of 15.2% on the prior year growth

• TAF achieved like-for-like sales growth of 10.9%, on the back of secon d h a lf lik e- f or- lik e grow th o f 17%

• Opened 6 new TAF stores, taking the total number of stores to 136

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4

2009 – Another ear of record sales y

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Sales and stores
170 150
145
150
140
135
130
130
110 125
120
90
115
110
70
105
50 100
Total sales Total stores
5
sales ($m) r of stores
Group Numbe
5 6 7 8 9
FY200 FY200 FY200 FY200 FY200
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Si nificant transactions since ear end g y

New The Athlete’s Foot Licence

• Signed new long term licences for The Athlete’s Foot Australia and New Zealand, by paying an upfront amount of US$6.2m

• Term of new licences is 249 y ears

• Under new licences The Athlete’s Foot will no longer pay ongoing licence fees to the US licensor

• This will result in an increase in TAF’s EBIT in FY10 by approximately $1.2m ands in FY11 by approximately $1.3m

• In addition to the positive effect on EBIT , the new agreements remove a number of operating restrictions contained within the old agreements

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6

Si nificant transactions since ear end g y

Merrell Distribution Agreement

• RCG awarded distribution rights to the Merrell brand of outdoor, comfort, act ve esty e an i lif l d per f ormance ootwear an f d appare e l ff ect ve 1 January i 2010

• RCG has secured the entire Merrell mana ement and sales team and is g

• finalising the set up of the new wholesale /distribution business infrastructure. This is on track to commence operations on 1 January 2010.

• Expected turnover is in excess of $12 million in first year with multiple customers in the department store, speciality and outdoor retail sectors

• Based on profiles of similar businesses, we expect Merrell to deliver an EBIT margin in excess of 20% from FY2011

• Highly complementary with growth strategy in TAF and Shoe Superstore

• � RCG believes that there are si g nificant ex p ansion o pp ortunities that will g row the business substantially

• RCG intends to rollout a number of Merrell flagship stores in order to build the brand ’ s presence in Australia

7

Si nificant transactions since ear end g y

Shoe Superstore

• RCG acquired 100% of Shoe Superstore for approximately $1 million including working capital

• The vendors have si ned six- ear service a reements with a g y g

• potential earn out payment if substantial profit hurdles are met

• Shoe Superstore is a 3-store, non-mall based, chain of branded com f or t an d lif es t y e oo l f t wear s t ores w hi c h RCG i n t en d s o t remodel, improve and grow before commencing a gradual but sustained store rollout programme

• The business provides an excellent platform to capitalise on the emerging branded comfort footwear market and services a different demographic to The Athlete ’ s Foot

• � Shoe Superstore is unlikely to have a material impact on group profit for 2 -3 years

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8

The Athlete’s Foot – u date & outlook p

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9

The Athlete’s Foot – u date & outlook p

Sales update and outlook

• Sales growth for the 4 months to October 2009:

• Total sales growth: 13%

• � Like for like sales growth – all stores: 10%

• Like-for-like sales growth – large format stores: 30%

• Like-for-like sales rowth – traditional stores: 9% g

• Like-for-like growth for the first 2 weeks of November: 15%

• Due to inherently uncertain trading conditions for the remainder of the financial year, we have not revised our earlier indication of double digit sales growth and 5% - 7% like-for-like sales growth for the f u ll financial y ear

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The Athlete’s Foot – u date & outlook p

New stores and store conversions

• 6 new stores (all large format) opened since the beginning of the 2010 financial year, with 2 more stores expected to open in the second half of the financial year. This will take the total number of .

• stores in the group 141

• 5 existing stores have now been converted to large format, with 3 more conversions scheduled to take lace before Christmas and p

• another 5 in the second half of the financial year. This will take the total number of large format stores to 21

• TAF New Zealand

• TAF has sold its NZ assets for approximately NZ$650k to a newly appointed New Zealand master franchisee . We believe that the NZ market will benefit substantially from the dedicated focus of a master franchisee

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