Van de Velde NV — Earnings Release 2010

Feb 18, 2011

PRESS RELEASE 18.02.2011

VAN DE VELDE: ANNUAL RESULTS 2010

ORGANIC RISE IN TURNOVER (EXCLUDING INTIMACY) OF 7.3%

REBITDA (EXCLUDING INTIMACY) ROSE 16.9%

GROUP PROFIT (EXCLUDING INTIMACY) ROSE 36.6%

PROPOSED INCREASED DIVIDEND OF €2.15 PER SHARE

1. CONSOLIDATED KEY FIGURES 2010

This financial report publishes the consolidated figures for the full year 2010 (in accordance with IFRS) including and excluding Intimacy.

Including Intimacy means that the holding in Intimacy is recognised in accordance with the full consolidation method at 85% (after the end of April 2010).

Excluding Intimacy means that the holding in Intimacy is presented as in the 2009 figures and recognised in accordance with the equity method. In practice, this means that the 85.0% holding is recognised as "Participations (equity method)" (49.9% until the end of April 2010 and 85.0% after the end of April 2010) and that 49.9% of Intimacy"s net result for the period January to April 2010 is recognised as "Share of profit of associates". The figures excluding Intimacy are not audited and are provided for information purposes only (pro forma figures) to enable comparison with 2009.

Consolidated key figures	31.12.2010		31.12.2009	% incl.	% excl.
	Including	Excluding		Intimacy	Intimacy
	Intimacy	Intimacy
INCOME STATEMENT (IN M€)
Turnover	166.3	150.4	140.1	18.7%	7.3%
Other operating income	4.2	4.2	3.5	19.1%	19.1%
Cost of materials	(38.9)	(33.2)	(34.7)	12.3%	(4.2%)
Other expenses	(44.4)	(39.5)	(35.1)	26.6%	12.6%
Personnel expenses	(34.8)	(30.1)	(32.5)	7.0%	(7.4%)
Operating profit before depreciation	52.3	51.7	41.3	26.5%	25.1%
and amortization ("EBITDA") (1)
Recurring operating profit before	52.3	51.7	44.2	18.2%	16.9%
depreciation and amortization
("REBITDA") (2)
Depreciation and amortization	(6.0)	(4.7)	(3.8)	56.8%	23.5%
EBIT or operating profit	46.3	47.0	37.5	23.5%	25.3%
Financial result	6.2	1.9	(0.1)	11.798%	3.660%
Share of profit of associates	0.1	0.1	(0.6)	108.2%	108.2%
Profit before taxes	52.6	48.9	36.8	42.8%	33.0%
Income taxes	(12.6)	(12.6)	(10.2)	23.6%	23.6%
Profit for the period attributable to	(0.1)	-	-	-	-
non-controlling interests
Profit for the period attributable to the owners of the company	40.0	36.3	26.6	50.4%	36.6%

(1) EBITDA equals operating profit increased with depreciation and amortization on fixed intangible and tangible assets.

(2) REBITDA equals EBITDA plus the one-off restructuring cost of €2.9 million for the closedown of the plant in Hungary and the restructuring at Eurocorset (only relevant for 2009).

Consolidated key figures	31.12.2010		31.12.2009	% incl.	% excl.
	Including	Excluding		Intimacy	Intimacy
	Intimacy	Intimacy
BALANCE SHEET (IN M€)
Fixed assets	89.0	75.6	65.6	35.6%	15.2%
Current assets	92.9	90.3	83.7	11.0%	7.9%
Total assets	181.9	165.9	149.3	21.8%	11.1%
Shareholders" equity	153.6	150.6	135.7	13.2%	11.0%
Non-controlling interest	8.1	-	-	-	-
Non-current liabilities	3.3	0.6	2.3	40.8%	(76.2%)
Current liabilities	16.9	14.7	11.3	50.2%	31.0%
Total equity and liabilities	181.9	165.9	149.3	21.8%	11.1%
KEY FIGURES IN € PER SHARE
Recurring EBITDA	3.96	3.91	3.31	19.7%	18.4%
Profit for the period attributable to	3.03	2.75	1.99	52.3%	38.2%
the owners of the company

2. REPORT OF THE STATUTORY AUDITOR ON THE ANNUAL INFORMATION AT 31 DECEMBER 2010

The statutory auditor has issued an unqualified opinion on the consolidated financial statements. The accounting figures in this release are consistent with the figures in the consolidated financial statements.

3. NOTES TO THE CONSOLIDATED KEY FIGURES

TURNOVER GROWTH IN 2010

Van de Velde group"s organic turnover excluding Intimacy"s retail turnover rose 7.3% to €150.4 million. This rise in turnover was primarily due to a rise in volumes in all countries. Higher exchange rates also had a positive impact.

If Intimacy retail turnover is included (from May 2010), Van de Velde"s consolidated turnover was €166.3 million, a rise of 18.7% compared to 2009.

For the full year 2010 Intimacy generated turnover of \$35.5 million, a rise of 27.5% compared to 2009. Four new stores opened in 2010.

HIGHER GROSS MARGIN

The rising gross margin is proof that Van de Velde is successfully pursuing its trading-up strategy (high quality, high service) even in tough economic conditions. The gross margin was also positively impacted by better exchange rates and the continued efforts in terms of production costs. The gross margin is at an historical high in 2010 and above group targets.

RECURRING EBITDA ROSE 16.9%

Cost savings generated in 2009 had a positive impact on recurring EBITDA. Excluding Intimacy, this rose more sharply than turnover to €51.7 million in 2010, up 16.9% compared to 2009.

Recurring EBITDA including Intimacy was €52.3 million. On an annual basis Intimacy"s EBITDA was \$1.4 million.

MINORITY STAKES AND FINANCIAL CHARGES

The financial result was significantly better than in 2009 when it was strongly impacted by the write-down on the CDO portfolio of €1.2 million.

The results accounted for using the equity method were slightly positive in 2010. This is primarily due to the contribution of Top Form (after adjustment for paid dividend) and Intimacy (first four months of 2010).

The financial result including Intimacy takes account of one-off income of €4.3 million recognised in the full consolidation of Intimacy. For more details about the IFRS recognition of Intimacy in the consolidation, see the half-year report ("Note to recognition of business combination with Intimacy").

PROFIT FOR THE PERIOD

Group profit excluding Intimacy rose from €26.6 million to €36.3 million (+36.6%) and profit per share rose from €1.99 to €2.75.

CASH POSITION

The cash position at the end of 2010 was €38.2 million.

4. DIVIDEND

For the financial year 2010 the Board of Directors will propose a higher dividend of €2.1500 per share (net dividend €1.6125 per share) to the General Meeting of Shareholders.

The remaining financial sources (including cash position) allow all necessary investments to be made that protect the competitiveness of the company.

5. PROSPECTS FOR 2011

• For Van de Velde (excluding Intimacy"s retail turnover):
• Growth is expected in the first six months of 2011 (spring collection).
• Sales of the 2011 autumn collection are more difficult due to slower in-store sales to consumers in autumn 2010. Sales are currently slightly down on last year. It is still too early (by a few months) to forecast turnover for the second half of 2011.

• Intimacy plans a further expansion of the number of stores in 2011: from 13 stores at the end of 2010 to 16 or 17 stores by the end of 2011.

• Apart from Intimacy, the retail activities will be developed further with the rollout of Oreia in Germany and LinCHérie in the Netherlands.

• Increased costs in a number of areas are factored in for 2011, primarily in production (China) and marketing (increased sales efforts). As a result, the gross margin will be slightly lower than in 2010.
• Strategy continues to focus on the fitting room ("shape the body and mind of women") and trading up (service culture and brands) in both key and growth markets.

6. FINANCIAL CALENDAR

Annual report 2010	No later than 13 April 2011
Q1 2011 interim statement	27 April 2011 after end of trading
2010 General Meeting	27 April 2011
Ex-coupon date	2 May 2011
Record date	4 May 2011
Payment dividend	5 May 2011
H1 2011 turnover figures	8 July 2011 before start of trading
2011 half-year results	26 August 2011 before start of trading
Q3 2011 interim statement	18 November 2011 before start of trading

7. CONTACTS

For more information, contact:

Van de Velde NV, Lageweg 4, 9260 Schellebelle – 09 365 21 00 www.vandevelde.eu

Ignace Van Doorselaere CEO

Stefaan Vandamme CFO

8. VAN DE VELDE

Van de Velde NV is a leading player in the luxury and fashionable women"s lingerie sector. Van de Velde is convinced of the merits of a long-term strategy based on developing and expanding brands around the Lingerie Styling concept (fit, style and fashion), especially in Europe and North America.