Ovs — Investor Presentation 2016

Apr 14, 2016

FY15 FINANCIAL RESULTS

OVS April, 2016

Disclaimer

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This presentation might contain certain forward-looking statements that reflect the Company's management's current views with reevents and financial and operational performance of the Company and its subsidiaries. These forwardS.p.A.'s current expectations and projections about future events. Because these forwardactual future results or performance may differ materially from those expressed in or implied by these statements due to any factors, many of which are beyond the ability of OVS S.p.A. to control or estimate. You are cautioned not to place undue relilooking statements contained herein, which are made only as of the date of this presentation. looking respect to future forward-looking statements are based on OVS forward-looking statements are subject to risks and uncertainties, number of different reliance on the forward-

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OVS S.p.A. does not undertake any obligation to publicly release any updates or revisions to any forwardcircumstances after the date of this presentation.forward-looking statements to reflect events or

Any reference to past performance or trends or activities of the OVS S.p.A. shall not be taken as a representation or indicatperformance, trends or activities will continue in the future.indication that such

This presentation does not constitute an offer to sell or the solicitation of an offer to buy OVS's securities, nor shall theor be relied on in connection with any contract or investment decision relating thereto, or constitute a recommendation regarOVS. OVS's securities referred to in this document have not been and will not be registered under the U.S. Securities Act of offered or sold in the United States absent registration or an applicable exemption from registration requirements. document form the basis of regarding the securities of 1933 and may not be

Nicola Perin, the Manager in charge of preparing the corporate accounting documents, declares that, pursuant to art. 154Legislative Decree no. 58 of February 24, 1998, the accounting information contained herein correspond to document results, baccounting records.154-bis, paragraph 2, of the books and

This investor presentation contains measures that were not prepared in accordance with IAS/IFRS.

FY15 Highlights

Strong sales growth across all brands and categories, sustained by +1.8% (notwithstanding a very strong FY14 performance) and network expansion slightly ahead of plan LfL growth

Further market share increase to 7.0% as of December 2015 (+60bps vs. Dec 2014 and +30 bps vs. Jun 2015)

€179.6m EB ITDA, €22.5m higher than FY14 (+14.3%), with EBITDA margin increasing to 13.6% of sales (+80 bps) driven GM%, operating leverage, accretive contribution of franchise sales and cost control22.5m by higher sales at stable

€114.9m EBT, €69.1m higher than also from the improved capital structure as a result of the IPO FY14, benefitting

Net profit of €81.1m (€0.36 EPS), FY14, benefiting from (i) the operating result, (ii) a interests (iii) and a lower 0.36 up by €55.8m vs EBITDA Growth) a marked improvement in substantial reduction in tax rate

Proposed total dividends share, representing a pay€34.05m, or €0.15 per pay-out of 42.0%

+7.5%

Increase in Net Sales

Full format DOS

+154 other stores mainly Kids in franchising

Net Income (€0.36 EPS)

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Key Income Statement ItemsPositive performance in FY15

		F Y 1 5		F Y 1 4
K M i * t e e r c s y	€ l m n	% f N S l t o e a e s	€ l m n	% f N S l t o e a e s	G h t r o w
S N l t e a e s	1, 3 1 9 5		1, 2 2 4 7		7. 5 %
G M i r o s s a r g n	4 7 5 5	2 % 5 7.	0 8 7 5	% 5 7. 5	6. 9 %
E B I T D A	1 9 6 7	1 3. 6 %	1 1 5 7	1 2 8 %	1 4. 3 %
E B I T	1 3 0 0	9. 8 %	1 0 6 8	8. 7 %	2 1. 6 %
P B T	1 1 4 9	8. 7 %	4 5 8	3. 7 %	1 5 1. 0 %
N P f i t t e r o	8 1. 1	6. 1 %	2 5 3	2 1 %	2 2 0. 7 %

• • FY15 Net Sales increased by 7.5% driven by an expanded selling area and positive recorded in FY14; both brands and all the main product categories displayed positive growth ratesLfL performance, notwithstanding the strong LfL growth
• • Gross Margin was unchanged across the individual sales channels; the 30 contribution to the revenue mix (the impact of higher franchise sales however is accretive at bps dilution as a percentage of revenue was due to higher franchise EBITDA margin level)
• • EBITDA increased by 14.3% despite higher marketing costs. EBITDA margin increased by approx. 80bps to 13.6%
• • PBT increased by €69.1m thanks to operating leverage and lower financial expenses (March69.1m (-€46.0m), mainly as a result of the debt refinancing in
• • Net Income of €81.1m reflects the underlying business growth as well as the post tax rate (29.4%)s post-IPO capital structure interest savings, combined with a lower

(*) Excluding extraordinary costs mainly related to the IPO and the refinancing

Sales and EBITDA Performance in FY15

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Consolidated Net Working Capital

€ l m n	3 1 J '1 6 a n a r u y	3 1 J '1 5 a n a r u y	C h a n g e
A R i b l t c c o n s e c e a e u v	1 0 7	3 0 7	( ) 2 0
I t n v e n o r y	2 8 9 7	2 8 6 7	2 1
A P b l t c c o u n s a y a e	( ) 3 6 8 8	( ) 3 4 4 7	6 5
N W k i C i l t t e o r n g a p a	( ) 8 1	( ) 1 3 8	5 6

• • The working capital structure remained substantially stable vs. January last year:
• – Improved DSO resulted in lower account receivables notwithstanding the growth experienced by the franchise network (with new also requiring an initial investment in merchandise by the franchisees)openings
• – Inventory was substantially flat in value in spite of the store expansion and the strengthening of USD (c. valuation), thanks to careful purchasing and inventory management€9m upward impact on inventory which resulted in a better stock aging profile
• – Accounts payables decreased marginally mainly because data at 31 January 2015 also included certain payables related to the self financed capex for the LED project.

Capex

• • Capex (€68.3m in FY15) include:
• new openings (c. 47% of total capex)
• refurbishment and maintenance of the existing network (c. 17%)
• IT and special projects (c. 15%), mainly related to operational projects
• automated logistics equipment (c. 19%), mainly related to a planned project dedicated to support the replenishment activities (increasing speed, efficiency and capacity)
• Capex for the LED project - entirely managed through vendor financing - and other miscellaneous expenses (c. 2%)

Net Debt and Leverage

€ l m n	3 1 J '1 6 a n a r u y	3 1 J '1 5 a n a r u y
N D b t t e e	2 3 5 0	6 2 4 4
E B I T D A L T M	1 9 6 7	1 1 5 7
L E B I T D A e v e r a g e o n	1 3 x	4 0 x

• • During the year, EBITDA leverage declined by 2.7x vs. 31 January 2015 due to the proceeds from the IPO as well as operating cash flow generation
• • Residual net debt post IPO has been entirely refinanced at more favorable interest rates:
• •The average interest rate in FY15 was 3.4% vs. 5.42% in FY14
• • FY15 cost still does not reflect in full the benefit of the refinancing (only c.11 months experienced lower rates). 4Q15 was 3.04%The average interest rate in
• •Further improvements are expected at the current level of leverage

Consolidated Cash Flow Statement

• • Operating cash flow for the year reached €118.0m:
• Limited increase in operating working capital, while other changes in working capital primarily relate to the expansion of the network, which resulted in increased VAT, personnel and other payables
• Capex includes c. €12.6m one-off costs relating to the automation of the post-distribution process
• • Tax payments include a €10.6m IRAP disbursement for 2014 and payments on account for 2015, with the remaining €9.8m relating to IRES for 2014. As OVS SpA was incorporated in 2014, no payments in accounts had been made for that year.

€ l l m m n n	F Y 1 5
E B I T D A	1 9. 6 7
C C h i N W k i i l t t a n g e n e o r n g a p a	( ) 5. 6
C h i h ( l i b i l i i ) t t t a n g e n o e r a s s e s a e s	1 2. 4
C a p e x	( ) 6 8. 3
O i C h F l t p e r a n g a s o w	1 1 8. 0
F i i l E n a n c a x p e n s e s	( ) 2 0. 2
( ( ) T F R E E l l ' l i i d i t m m p p o o y y e e e e s s e a v n g n e m n y	( ) 2. 5
T a e s x	( ) 2 0. 5
O ( ) I P l. b k i i t c o s s e x c a n c o m m s s o n s	( ) 3. 6
I P O d ( f b k f ) t p r o c e e s n e o a n e e s	3 4 9. 1
O h t e r	( ) 6. 1
C ( f N h F l b M M d i i d t t t e a s o e o r e e r a e s a n w v v i d ) t t a m o r z e c o s s	4 1 4. 1
C h i M M d i i d i d t t t t a n g e n e r a e s a n a m o r e c o s v v z	( 2 4. ) 7
C C l d N h F l t t m a e e a s o u u w	3 8 9. 4

Outlook

• • Notwithstanding an adverse start of the year from a weather standpoint, the topline growth trend continues in FY16 at stable margins
• • The FY16 opening pipeline is highly visible, with many contracts already identified including a number of Coin December 23rd announcement:stores to be converted as per the
• – An additional 61 stores have opened since 31-Jan-2016, of which 9 were full 2016, format DOS
• – Following the inauguration of the new flagship OVS store in Milan in September, refurbished in Turin and Rome, based on a similar format in terms of both architectural quality and product range, recording excellent salesa large store was opened in Naples and two stores were
• • OVS remains focused on selective international expansion:
• –New manager hired to head the existing international business development team
• Partnership with Zalando finalized for online sales in 14 European countries
• • A number of CSR initiatives under implementation underscore the continued effort of the company in this area. Among them we hCreative Lab and the decision to relocate Milan Expo temporary store structure to the care for the benefit of OVS employees.highlight the Kids company headquarter, to be converted into a child day

Appendix

P&L Adjustments Bridge

€ l m n	3 1- J 1 6 a n- R d t e p o r e	/ o w n o n R i e c u r r n g	/ S k t o w o c O i t p o n s, i i D t e r v a v e s d P P A a n	3 1- J 1 6 a n- A d j d t u s e	3 1- J 1 5 a n- R d t e p o r e	/ o w n o n R i e c u r r n g	/ S k t o w o c O i t p o n s, i i D t e r v a v e s d P P A a n	3 1- J 1 5 a n- A d j d t u s e
N S l t e a e s	1, 3 1 9. 5			1, 3 1 9. 5	1, 2 2 4 7.			1, 2 2 4 7.
f c Pu ha b le rc s e s o o ns u m a s	5 6 5. 0			5 6 5. 0	5 3 0. 7	9. 1		5 2 1. 6
G M i r o s s a r g n	5 4. 5 7			5 4. 5 7	0. 7			0 5. 8 7
G M in % ro s s a rg	5 7. 2 %			5 7. 2 %	5 6. 8 %			5 7. 5 %
Pe l C t rs o nn e o s	2 6 1. 9	0. 3	1. 4	2 6 0. 2	2 4 4. 7	0. 8	0. 0	2 4 3. 9
S ic e rv e s	1 7 1. 6	2. 1		1 6 9. 5	1 6 3. 6	3. 8		1 5 9. 8
Re Ne f O he In t t t n s o r c o m e	1 2 4. 5	1. 0		1 2 3. 5	1 1 9 7.	0. 4		1 1 7. 5
W i d d Ac ls t r e- ow ns a n c ru a	1. 8			1. 8	4. 3	0. 1		4. 2
O he O ing C ha t t r p e ra rg e s	2 3. 4	3. 6		1 9. 8	2 4. 0	0. 8		2 3. 2
E B I T D A	1 7 1. 3	( ) 6. 9	( ) 1. 4	1 7 9. 6	1 4 2. 2	( ) 1 4. 9	0. 0	5 1 7. 1
E B I T D A %	1 3. 0 %			1 3. 6 %	1 1. 6 %			1 2. 8 %
De ia io & Am iza io t t t p re c n o r n	5 8. 2		8. 6	4 9. 6	5 8. 8		8. 6	5 0. 2
E B I T	1 1 3. 1	( ) 6. 9	( ) 1 0. 0	1 3 0. 0	8 3. 3	( ) 1 4. 9	( ) 8. 6	1 0 6. 8
E B I T %	8. 6 %			9. 8 %	6. 8 %			8. % 7
/ ( C ) Ne F ina ia l In ha t nc c o m e rg e s	1 4. 6	( ) 6. 8	7. 2	1 5. 0	7 8. 0	1 7. 0		6 1. 1
P B T	9 8. 5	( 1 3. 7 )	( 2. 8 )	1 1 4. 9	5. 3	( 3 1. 9 )	( 8. 6 )	4 5. 8
Ta xe s	1 1. 9	2 3. 5	( ) 1. 6	3 3. 8	0. 0	6. 0		2 0. 5
N I t e n c o m e	8 6. 6	9. 9	( ) 4. 3	8 1. 1	5. 3	( ) 2 5. 9	( ) 8. 6	2 5. 3

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Consolidated Balance Sheet Statement

€ l m n	3 1 J '1 6 a n a r u y	3 1 J '1 5 a n a r u y	C h a n g e
R i b l e c e a e s v	1 0 7	7 3 0	( ) 2 0
I t n e n o r v y	2 8 9 7	2 8 7 6	2 1
P b l a y a e s	( ) 3 6 8 8	( ) 3 4 4 7	5 6
i i C i N O W k l t t t e p e r a n g o r n g a p a	( ) 8 1	( ) 1 3 8	5 6
O S ( ) h h N f i i l R i b l P b l t t- t e r o r e r m o n n a n c a e c e a e s a a e s v y -	( ) 9 1 3	( ) 6 9 5	( ) 2 1 8
N W k i C i l t t e o r n g a p a	( ) 9 9 5	( 8 3 3 )	( ) 1 6 2
N A t t e s s e s	1 3 5 7 2 ,	1 3 4 3 9 ,	1 3 2
f N D d T t e e e r r e a x e s	( ) 1 4 2 7	( ) 1 6 8 5	2 8 5
O S ( ) h h N f i i l R i b l P b l t t- t e r o r e r m o n n a n c a e c e a e s a a e s v y -	( ) 6 1	( ) 9 5	( ) 0 2
S O I d i P i i d h P i i t t e e r a n c e n e m n r o s o n a n e r r o s o n s v y v v	( ) 4 8 7	( ) 5 3 8	1 5
N I d C i l t t t e n e s e a p a v	1 0 6 0 1 ,	1 0 3 2 4 ,	2 7 7
E i t q u y	8 2 5 1	4 0 8 0	4 1 7 1
N D b t t e e	2 3 0 5	6 2 4 4	( ) 3 8 9 4
S T l f F d i t o a o u r c e o u n n g	1 0 6 0 1 ,	1 0 3 2 4 ,	2 7 7