| Apresentao do Roadshow As of March 2014 April 2015 1 Disclaimer - - PowerPoint PPT Presentation

| Apresentação do Roadshow

As of March 2014

April 2015

Statements regarding the Company’s future business perspectives and projections of operational and financial results are merely estimates and projections, and as such they are subject to different risks and uncertainties, including, but not limited to, market conditions, domestic and foreign performance in general and in the Company’s line of business. These risks and uncertainties cannot be controlled or sufficiently predicted by the Company management and may significantly affect its perspectives, estimates, and projections. Statements on future perspectives, estimates, and projections do not represent and should not be construed as a guarantee of

• performance. The operational information contained herein, as well as information not directly derived from

the financial statements, have not been subject to a special review by the Company’s independent auditors and may involve premises and estimates adopted by the management.

Disclaimer

| Company overview

.1 Platform of brands of reference

Arezzo&Co is the leading Company in the footwear and accessories industry through its platform of Top of Mind brands

1

.2 Company overview

Arezzo&Co is the reference in the Brazilian retail sector and has a unique positioning combining growth with high cash generation

1

Leading company in the footwear and accessories industry with presence in all Brazilian states Controlling shareholders are reference in the sector Development of collections with efficient supply chain Asset light: high

• perational

efficiency Strong cash generation and high growth

10.8 million pairs of shoes (1) 852 thousand handbags (1) 2,727 points of sale 12% market share (2) More than 42 years of experience in the sector Wide recognition ~11,500 models created per year Lead time of 40 days 12 to 15 launches per year 91% outsourced production ROIC of 22.3% in 1Q15 2,192 employees Net revenues CAGR: 26.7% (2007- 1Q15¹) Net Profit CAGR: 29.5% (2007- 1Q151) Increased operating leverage

• Founded in 1972
• Focused on brand and

product

• Consolidation of industrial

business model located in Minas Gerais

• 1.5 mm pairs per year

and 2,000 employees

• Focus on retail
• R&D and production
• utsourcing on Vale dos Sinos
• RS
• Franchises expansion
• Specific brands for each

segment

• Expansion of distribution

channels

• Efficient supply chain

First store Fast Fashion concept Launch of the first design with national success

Schutz launch Launch of new brands

Commercial operations centralized in São Paulo

Industry Reference Foundation and structuring Industrial Era Corporate Era Retail Era 2012 – 2014

Opening of the first shoe factory Opening of the flagship store at Oscar Freire

.3 Successful track record of entrepreneurship

The right changes at the right time accelerated the Company's development

1

Consolidate leadership position

Initial Public Offering (February 2011)

Shareholder structure1

.4 Shareholder structure

52.2% 47.8%

Birman family Others

1

Management²

1.1%

Float

46.7%

.5 Culture & Management

1

01 That which is not transparent should not be done. 02 Always be true, so that at some point you are not false in your job. Always be authentic. 03 Clearly negotiate your goals and responsibilities, and consider compliance as a requirement for continuity. 04 Do not uncover problems only. Blaming others will never be the solution. Take risks, propose

• solutions. In case of doubt, act!

05 Formalize everything, even in an informal way. 06 Always be flexible. Always be willing and ready for changes. 07 Goals met are, at least, the basis for the next goal. 08 United we stand! Divergences are constructive, conflicts are destructive. 09 A humble stance: the key to our success. 10 Enjoy. Like. Get involved. And always be happy!

Principles of success at Arezzo&Co:

2154

.6 Strong platform of brands

Strong platform of brands, aimed at specific target markets, enables the Company to capture growth from different income segments

1

Trendy New Easy to wear Eclectic Fashion Up to date Bold Provocative 16 - 60 years old 18 - 40 years old

R$ 330.00/pair

Pop Flat shoes Affordable Colorful 12 - 60 years old

R$ 110.00/pair

Design Exclusivity Identity Seduction

R$ 960.00/pair

20 - 45 years old

Brands profile Women target market Sales Volume3 % Gross Revenues4 Retail price point Foundation

1972 1995 2008 2009

MB O O F MB

R$ 189.00/pair

O F MB Distribution channel1

EX EX EX 8 2 19 356 28 46 1,379 73% 11% 14% 15% 35% 38% 29 1% 77 12% 32 19% 3% 68% 4 53 77 42% 38% 19% 1% O F MB EX

R$ 777.0 million R$ 505.6 million R$ 78.1 million R$ 16.3 million 56.4 % 36.7% 5.7% 1.2%

.7 Multiple distribution channels

1

Flexible platform through different distribution channels with specific strategies, maximizing the Company's profitability

Gross Revenues per Channel 53 owned stores of which 11 flagship stores About 1,169 cities and 2,219 multi-brands 455 franchises in more than 160 cities in Brazil Broad distribution in every Brazilian state Gross Revenue Breakdown – (R$ mm)¹

Franchises Owned stores Multi-brands Exports² Total

49% 23% 22% 6% 100% 661 322 310 892 1,383

| Business model

Management BRANDS OF REFERENCE

Customer focus: we are at the forefront of Brazilian women fashion and design

Multi-channel Sourcing & Logistics Communication & Marketing

SEASONED MANAGEMENT TEAM WITH PERFORMANCE BASED INCENTIVES NATIONWIDE DISTRIBUTION STRATEGY EFFICIENT SUPPLY CHAIN SOLID MARKETING AND COMMUNICATION PROGRAM ABILITY TO INNOVATE

R&D

1 2 3 4 5

Unique business model in Brazil

2

.1 Ability to Innovate

We produce 12 to 15 collections per year

2

• I. Research

Creation: 11,500 SKUs / year

• II. Development
• III. Sourcing
• IV. Delivery

Arezzo&Co fulfills the various aspirations of women, delivering on average 5 new models at the stores per day, allowing for consistent desire-driven purchases

Available for selection: 63% of SKUs created / year

Stores: 52% of SKUs created / year

Creation Launch Orders Production Delivery Normal sale Discount sale

Activities JAN FEV MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

CRM – VIP sales In-store events – PA Stylists Fashion Advisors

.2 Broad media plan

2

Each brand has an integrated and expressive communication strategy, from the creation of campaigns to the point of sales

Strong presence in printed media

+71 inserts in printed media in 134 pages in 2014 (48 million readers) Over 1350 exhibition in fashion editorials in 2014

Digital communication Presence in electronic media and television

Demi Moore Seasonal showroom in Los Angeles near the Red Carpet Season

Celebrity Endorsement Marketing Events

+2.2 million accesses to site/month (+180k monthly access to Schutz’s Blog) Average navigation time: 8 minutes Gisele Bündchen Blake Lively +270 exhibition on Cable TV + 4 million impact

Over 6 million followers/ fans: Facebook, Instagram and Twitter (all 4 Brands) Arezzo is leader in interactions*

Stores constantly modified to incorporate the concept of each new collection, creating desire-driven purchases

.2 Communication & marketing program reflected in every aspect of the stores

2

All visual communication at stores is monitored and updated simultaneously throughout Brazil for each new collection

Flagship stores Store layout & visual merchandising POS materials (catalogs, packaging, and others)

.2 Atmosphere of stores: differentiated concepts for each brand

2

Visual merchandising:

• Updates at low cost investment
• Brings relevant information from

each collection to stores’ level

• 3 main updates per year

Chameleon project: constant modification to incorporate the new collection’s concept

• Jackets and accessories
• Campaigns and marketing actions
• Preeminence for products
• Differentiated products
• Display of a large variety of

products

• Inventory at the sales area: lower

necessity of space for storage

• Atmosphere of a jewelry store
• Private shop experience
• Focus on exclusivity, design and

highly selected materials

.3 Large distribution network and scale of store chain

2

Brand Average size (m2) Net Revenue/m2 (R$ 000s) Total Stores1

65 37 449 108 21 760 1,575 9 277 1,012 6 407 251 12 207

Mono-brand store chain with high distribution network, reaching more than 160 cities and well-positioned among the retail companies

Size and average sales per mono-brand stores - 2013

356 franchises + 19 owned stores(i) + 1.132 multi-brand clients

46 franchises + 28 owned stores(ii) + 1,379 multi-brand clients

Points of sale (1Q15)

TOTAL 53 franchises 4 owned stores 997 multi-brand clients 2 owned store + 8 multi-brand clients

455 franchises5 + 53 owned stores5 + 2,219 multi-brand clients =2,727 points of sales

GDP³: 18% A&C¹: 17% GDP³: 55% A&C¹: 57% GDP³: 17% A&C¹: 15% GDP³: 9% A&C¹: 7% GDP³: 5% A&C¹: 4%

57 sq m 85 sq m 80 sq m Points of sale – average size: new stores opened in 2011 and 2012 increased network average size

2010 2011 new stores 2012 new stores 2013 new stores

55 sq m

2014 new stores

52 sq m

Reception: 100,000 units/day Storage: 100,000 units/day Picking: 150,000 units/day Distribution: 200,000 units/day

.4 Flexible production process…

2

Production speed, flexibility and scalability to ensure Arezzo&Co’s expected growth based on asset light model

Arezzo’s scale and structure gives flexibility to source a large number

• f SKU’s from various factories on a short time frame at competitive

prices Owned factory with capacity to produce 1.1 million pairs annually and a strong relationship with Vale dos Sinos production cluster as the main outsourcing region

Sourcing Model Gains of scale Joint purchases Certification and auditing of suppliers

In-house certification and auditing ensure quality and punctuality (ISO 9001 certification in 2008) Coordination of material purchase jointly with shoe, handbag and accessories’ suppliers

New Distribution Center Sourcing model – 91% of production outsourced Consolidation and improvement of distribution in national scale

1 2 3 4

9% 91% Arezzo&Co

• wned

factory Others

88% 91% 81% 77% 80% 78% 79% 12% 9% 19% 23% 20% 22% 21% 1044 1369 2067 2967 4686 5897 6586 2007 2008 2009 2010 2011 2012 2013 Flagship Standard store

.4 ... sold through owned stores…

Capturing value from the network while developing retail know-how and brands’ visibility

2

Flagship Stores

Greater brand awareness coupled with operational efficiencies

• Clustering higher productivity stores in main areas (mainly SP and RJ) improving
• perational efficiency and profitability:
• Direct costumers interaction develops retail assets which are also reflected at

franchised stores

• Flagship stores ensure greater visibility and reinforce brand image

R$3.0 mln R$5.9 mln

Annual Average Sales per Store 2014

Total sales area and # of owned stores (m2)

# owned Stores

6 10 21 29 45 57 54

Structure applied to retail in order to achieve better sales and margin results as well as to integrate and connect all monobrand stores’ back office

2

.4 … based on a retail oriented structure...

Strong focus on franchise and owned store performance

• All sales team (4,000+) get connected through national internet broadcast for three sales conventions per year,

creating an aligned sales pitch and a great sense of motivation before each season

• Large service program to assist franchisees on sales and profitability goals
• Recurring training programs in products, fashion trends, sales techniques, store management, IT, among others
• Strong visual merchandising, trade marketing and ambiance investments and training

• Intense retail training
• Ongoing support: average of 6 stores/ consultant and average of

22 visits per store/ year

• Strong relationship with and ongoing support to franchisee
• IT integration with our franchises amounts to 100%
• As mono-brand stores, franchises reinforce branding in each city

they are located

2

4 or more franchises 1 franchise 2 franchises 3 franchises

42% 13% 30% 15%

.4 …with efficient management of the franchise network...

Model allows rapid expansion with low invested capital by Arezzo&Co and high profitability to franchisees

Successful Partnership: “Win – Win” Franchise Concentration per Operator

100% of on-time payments 96% satisfaction of franchisees1 Excellence in Franchising Award in the last 8 years (ABF) Best Franchise in Brazil (2005 and 2012) and in the industry for 7 years since 2004

(# of franchises by # of franchisees)

5-year contract and average payback of 40 months2

284 310 1Q14 1Q15

.4 ...and of the multi-brand stores

2

Multi-brand stores’ Gross Revenue¹ Improved distribution and brand visibility

• Greater brand distribution network
• Presence in over 1,169 cities
• Rapid expansion at low investment and risk
• Main focus: share of wallet
• Owner’s loyalty

 Schutz Club – Relationship program that offers advantages to the 50 Top Multi-brand stores, such as better products display, training and awards to the best sales teams.

• Important sales channel for smaller cities
• Sales team optimization: internal team and commissioned sales

representatives

Multi-brand stores widen the distribution network and the brands’ visibility, resulting in a strong retail footprint

Multi-brand stores

LTM Gross Revenue (R$ million) # Stores

2,355 2,219

9.2%

• 5.8%

Years at Arezzo Years of experience

.5 Seasoned and professional management team

2

Years at Arezzo Years of experience

Highly qualified management team

• Stock option plan for key executives
• Performance based compensation package for all employees
• Independent business units leveraged on a single shared service structure: Industrial, Logistics, Financial and HR

Marco Coelho Internal Auditing

Alexandre Birman

Independent business units Cassiano Lemos Collection Planning

José Bolonha (Coordinator) Juliana Rozenbaum (Coordinator)

.6 Corporate governance

2

Risk, Audit and Finance Committee

Committees

Strategy Committee People Committee

Members: Alexandre Birman (CEO), Guilherme A. Ferreira, Edward Ruiz, José M. Carvalho, Marco Antônio Coelho e Thiago Borges (CFO) Members: Alexandre Birman (CEO), Anderson Birman (Chairman) , Fabio Hering, Fernando Caligaris, Carolina Faria and Arthur N. Grynbaum¹ Members: Alexandre Birman (CEO), Claudia Soares and Ligia Martins.

The Board is comprised of 10 members, of which 4 are independent, and has a very large engagement on the strategic planning of Arezzo&Co

Name Experience Name Experience Title Title

Board of Directors

Anderson Birman

Carolina Faria

Fabio Hering

Rodrigo C. Galindo

Welerson Cavalieri

Juliana Rozenbaum

Claudia Soares

José Murilo Carvalho

Guilherme A. Ferreira

José Bolonha

Welerson Cavalieri (Coordinator)

| Value Drivers Update

.1 Solid growth fundamentals

3

The Company has ongoing initiatives to unlock value to shareholders

Net revenues CAGR 2007-1T15 LTM 26.7%

• Guidance of 62 stores openings in 2015
• Strong Schutz’s sales encourages launch of webcommerce channel

for other brands

• Multibrand strategy brings strong distribution network

DISTRIBUTION NETWORK AND SALES AREA EXPANSION

• GTM Arezzo project enhancing sell-out performance
• New store layout for Arezzo and Anacapri increased sales per m²
• Repositioning of handbags in Schutz presented very positive results
• Internal benchmarking allowing for constant identification of
• pportunities for improvement in store productivity

STORE PRODUCTIVITY

2

• Continuous focus on diluting operating expenses

PROFITABILITY

3

• Constant analysis towards improvements in logistics and distribution

PROCESS EFFICIENCY

4 1

.1 2014/2015 Expansion Plan

Since IPO for 3 consecutive years, stores opening guidance was achieved; 2015 expansion guidance at 62 new stores with 11% growth in sales area

3

• 58 stores opened in 2014
• In 2015, the Company will

increase its pace of openings with a total of 62 planned stores

• Due to multichannel strategy, in

2015 the Company plans to convert 5 owned stores into franchises

2014

403

2013

55 458 59 462 54 516 62

2015

529 49 578

+13%

+12%

• 1

5

• 5

.1 Web commerce: Entry into the channel

3

Client profile and fit to online media boosted Schutz entry into the online channel

Internet penetration is still very low in Brazil High fit of the product to the relevant global players evidenced by ecommerce operating shoes

SCHUTZ CUSTOMER SEGMENT

Ecommerce growth in Brazil, R$ billion

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

+

46% 78% 70% 66% 60% 59% 57% 41% Europe Asia

.1 Web commerce: Entry into the channel

3

Client profile and fit to online media boosted Schutz entry into the online channel

Benchmarks in mature markets

15%

• % revenue is on-line
• > 1.7 MM likes per month
• n each network and

30,000 comments

• 60-80 k new followers per

month +1.2M +1.6M

19% 5% 18%

On-line customer profile

50.1% Women Men 25

• 34

30% >35 18

• 24

20% A/B 54% C

MOST COMMENTED MOST LIKED

SCHUTZ CUSTOMER SEGMENT

+

Strength of Schutz in social media

.1 Web commerce: Channel evolution

3

Structuring of online channel and initial results confirm channel attractiveness and alignment

> 40 24 10 1 1 10 24 > 40

• R$ 1 million in 3 months of
• peration
• Beginning in Sep/2011 with

soft opening

• Medium size store in physical

network

• Proof of the thesis

2011

• Dedicated operational

management within Schutz

• Internal focus on quality of on-

line customer service

• Prioritization of structuring of

customer service and logistics

• Still low investment in on-line

marketing

• Great focus with "freshness" of

products available

2012

• Reaches R$24 million revenue
• Structuring of team and

investment in on-line marketing

• Leading brand in fashion

award on Instagram

• Seal RA1000 in customer

service

• Growth and profitability

inspired structuring of the Omni project

2013

• R$44 million in revenues
• Investment in new platform to

improve shopping experience

• Unified management of on-line

strategy

• Greater understanding of our

customer/BI/analytics

• Go-live of the new platform

hybris Sep/14

• Elected the seventh best e-

commerce in Brazil

• Start benchmarking with the

best in the industry

2014

.2 GTM Arezzo

3

Under GTM Arezzo the Company expects to increase the product accuracy at the stores with a new collection calendar and a shorter lead time

Life cycle

• More fashion content; largest collections

presented to the franchisees

Collection Continuables Classic

Showroom Fashion complement Fast fashion Continuables Classic Supply model

• Fashion complement using information

from the sell out

• Capturing quick trends, not only from

Arezzo’s stores, but also from market research

• Products automatically replaced in the

stores with some season colors

• Open size run replacement
• Products also automatically replaced in

the stores; only two colors. Full mark-up sell-through

.3 Store productivity increase

3

Arezzo’s new architectural design highlights our products even more

With new shelves and niches, we were able to increase in 50% the number of models exposed in the stores Window relate to the pattern used on our products’ soles, forming the brand’s “ZZ” symbol Suspended shelves around the entire store with lights that highlight the products Products highlighted in the center of stores Next to the cashier, a dedicated shelf for appliances allows us to add units to the sale A better distribution of the furniture offers more comfort for clients in the stores

.3 Evolution of architectural design and store model

3

New architectural design means proper showcasing of the products and a superior purchasing experience for a low outlay

Combo: at the back of the store, special offers in order to increase UPT and provide women with practical and quick service Tower: on one side, individual flat shoes are displayed; on the

• ther side, mirrors; and inside,

an inventory with a pair in each size Central Islands: to display the classical “must-have” Anacapri products Enchanted Island: at the front of the store with the leading new launches intended to attract customers

20 12 25 76 121 189 2009 2010 2011 2012 2013 2014

3

Changes in strategy for Schutz brand handbags resulted in a strong growth in the product segment

.4 Schutz Handbags

1 2 3

Executing product strategy Structuring supply chain Executing marketing and communication strategy

Handbags as a percentage of revenues¹

Key Results

Volume (in thousands of handbags)

0,0% 2,0% 4,0% 6,0% 8,0% 10,0% 12,0% 14,0% 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14

.4 Schutz Handbags

3

Difference between lines

Product technical standard Sourcing base Materials used Level of exposure of brand/logo V.M. in store and showroom Depth of purchases in the grids Training of commercial teams Marketing and communication actions

• Exploring luxury goods code
• Adjusting product mix to different
• ccasions of use
• Segmenting product mix by label

and price range (Premium, Mainstream, Pop&Fun)

• Building mix by distribution

channel

• Increasing quality and perceived

value of the products

O / F MB CHANNEL HANDBAGS

✔ ✔ ✔ ✔

Product strategy

Product line segmentation enables reaching different audiences in different channels, with the proper branding strategy and meeting clients’ desires

3

Focus on supply chain helped to increase perceived quality and desire for the product

.4 Schutz Handbags

1 2 3

Focus on minutious product development Product mix optimization with a reduction in the number of SKUs Local development of sourcing base

Supply chain strategy

3

Communication and marketing strategy consists in replicating the success reached in footwear based on the pillars product, desire and store

.4 Schutz Handbags

Impact

Bloggers and celebrity endorsement Strategy to create iconic models Exclusive windows Social media Press and spontaneous media

Communication and marketing strategy

Key takeaways

Undisputable category leader

1

Significant growth potential

2

Brands of reference

3

Scalable platform with operating leverage

5

Efficient and market oriented supply chain

4

High return on invested capital

6

3

| Market Overview and | Sourcing and Industry Characteristics

.1 Social upward mobility driving internal consumption

4

Income growth and job creation lead to rapid social upward mobility and increasing internal consumption

2003 70 (36%) 54 (27%) 96 (55%) +14 mi

+49 mi

2014E 2011

27 (14%) 22 (11%) 13 (8%)

(Consumption growth as a result of the upward mobility in social classes; indexed 100 = class D/E)

D/E

C

B

A

Apparel and Footwear

Footwear and apparel have the largest growth potential

Brazil experiences an accelerated process of social upward migration...

(Millions of people)

...Resulting in a significant rise of consumer goods consumption, including Footwear and Apparel

.2 Brazilian footwear market overview

4

Arezzo&Co has a significant stake of the women footwear market and has consistently increased its market share

Arezzo&Co’s market share1

Total footwear market (R$ bn)

CAGR (03-14E): +10% 30% 40% 15% 15%

Footwear consumption 2014

9% 39% 43% 8%

Social Class

Men Children Women Class A Classes D/E Class C Sports Class B

Women footwear Total footwear market

2014E

17.2 43.4

4% 7% 8% 9% 10% 11% 11% 12% 2007 2008 2009 2010 2011 2012 2013 2014E

.3 Brazilian handbags market overview

4

Arezzo&Co also has a relevant position within the fast growing handbag market in Brazil

Share of handbags and shoes

 Opportunity to consolidate handbag leading position

Total handbags market (R$ bn)

Women handbags Total handbags

2014E

CAGR (03-14E): +10.5%

4.4 5.6 Total addressable market (R$ bn)

80% 20% Footwear Handbags

21.6¹

20% 50-60% 17% 12% 14%

Pairs (millions) Production World share China 12,597 62.4% Índia 2,060 10.2% Brazil 900 4.4% Vietnam 760 3,8% Indonesia 658 3.3% Pakistan 292 1.4%

Brazil is the third largest footwear producer, with production mostly destined to supply the domestic market. Competitive costs, flexibility on minimum production and short lead time are the pillars to serve the fast fashion market

.4 Footwear Industry - Global Overview and competitive advantages

Pairs (millions) Consumption World share China 3,279 15.2% USA 2,285 13.4% India 2,260 11.7% Brazil 787 4,5% Japan 690 4.0% Indonesia 532 3.6%

4

Brazil is recognized by the quality and high specialization within different and complex categories of shoes. The industry has been qualitatively developed in order to add value to products and thus increase its competitive advantages over Asian suppliers

.5 Footwear Industry - Global footwear

• ffering

Global Footwear Offering: the higher and more centralized the country is

in the pyramid, the more focused it is in fashion, creation, design, luxury market , marketing and distribution management, with smaller production scale

Equipment assembly Manufacturing operation Manufacturer with

• wn design and mostly local brand

Manufacturer with

• wn design and global brand

Global Brands

Value added

+

• France

Italy Spain Taiwan Brazil Mexico China India Thailand Vietnam Other global suppliers Indonesia

B A C D E

Industry segmentation vs. value creation:

4

.6 Arezzo&Co sourcing: Brazilian competitive advantages

Vale dos Sinos region offer strong competitive advantages, a combination of production capacity, production flexibility, skilled labor and strong structure to support incentives for innovation and strengthening of industry’s competitiveness

Source: IEMI 2013 / ASSINTECAL / FAO / AICSUL.

 Brazil is the world’s third largest footwear producer  The world’s largest cattle: 13% of the market  RS: One third (R$ 1 billion) of Brazilian revenue in leather industry  Vale dos Sinos: one of the world’s largest footwear manufacturing hubs  1,700 companies and entities: components, footwear, machinery, tanneries, trade entities, research and teaching institutions  Abundant skilled and specialized labor  Production flexibility: volume X variety X speed

Production (million pairs) Jobs (thousands) 900 353 Production (million pairs) Jobs (thousands) 372 190 Production (million pairs) Jobs (thousands) 234 120

BRAZIL SOUTHERN REGION VALE DOS SINOS

Vale dos Sinos: 26% of Brazilian footwear production

4

Trends and style Design Technical Design Engineering Samples Showroom Logistics and distribution

Store

Raw material price negotiations Scheduling + Manufacturer negotiation

1 2 3 4 5 6 7

.8 Arezzo&Co Sourcing Process and supply chain management

Sourcing process and supply chain management focused on ensuring flexibility, speed and cost control in the creation of new products

Arezzo&Co sourcing process: Coordinated management of production chain associated with Investments in product engineering: specific know how Arezzo&Co

Raw materials Finished products Cost control Engineering folder

Cost management efficiency Quality standard guarantee Efficient lead time Flexibility

Chemicals and textile Components

4

SKU MODEL CONSTRUCTION 10% 35% 70%

Reuse from collection to collection:

| Financial Highlights

05

.1 Operational and financial highlights

5

In this quarter, monobrand stores (Franchises and Owned Stores) increased 3.2%, and the Multibrand channel presented a 18.8% growth. SSS Sell-out reached 2.2% growth in the quarter.

SSS Sell-out (owned stores + franchises) SSS Sell-in (franchises)

Gross Revenues by channel – Domestic Market (R$ million)

SSS Sell-out (owned stores + web + franchises) 3.3% 8.7% 0.6%

• 4.0%

3.8% 2.2%

6.5%

145,9 146,0 63,9 70,5 55,6 66,1 0,9 1,1

266,3 283,7

1Q14 1Q15 Franchise Owned Stores Multi-brand Others¹

10.3%

0.1%

18.1%

193.8 367.1 412.1 571.5 678.9 860.3 963.0 1.052,9 2007 2008 2009 2010 2011 2012 2013 2014

5

.2 Operational and financial highlights

Key highlights

In 1Q15 increased 9.8% growth in sales area over the last 12 months, excluding outlets. Sales area increased 11.2% in the LTM. In 1Q15, gross revenue was R$300.4 million, up by 8.9% against 1Q14.

Number of Stores (R$ mln) and Total Area (m2- ‘000)

CAGR 07-1Q15LTM: 26.7%

Net Revenues (R$ mln)

Area CAGR 07- 1Q15LTM: 16.6%

89.4% 12.3% 38.7% 18.8% 26.7% 11.9% 9.3%

+11

299 343 407 460 46 57 54 54 22,1 26,7 32,1 35,7 1Q12 1Q13 1Q14 1Q15 Franchises Owned Stores Area

• 3

+0

20.6% 11.2% 20.7%

17,4 18,1 1Q14 1Q15 92,1 95,9 1Q14 1Q15

EBITDA Margin

92,1 95,9 1Q14 1Q15

266,3 283,7 9,5 16,8

275,8 300,4

1Q14 1Q15 Domestic Market External Market

5

.3 Operational and financial highlights

Gross Profit (R$ million) EBITDA (R$ million) Net Income (R$ million)

EBITDA

3.0% 12.8% 11.9% Net Margin Net Income 4.1% 8.2% 7.7%

Gross profit Gross Margin

43.1% 40.6% 4.2% 6.5% 8.9% 75.8%

Gross revenues (R$ million)

5

.4 Operational and financial highlights

Cash Conversion Cycle (R$ thousand) Cash Flow From Operating Activities (R$ thousand) Capex (R$ thousand)

¹ Days of COGS ² Days of Net Revenues

Operational Indicators

• 85.3%

Summary of investments 1Q15 1Q14

• Var. (%)

• 13.4%

• 65.9%

• 28.6%

Operating Indicators 1Q14 1Q15 Growth or spread%

• Franchises

• 4.0%
• 12.7 p.p

• 2.7 p.p

• 1.6 p.p

#days (R$'000) #days (R$'000)

111 273.494 110 313.472 Inventory¹ 69 102.756 71 121.079 2 Accounts Receivable² 92 244.997 101 296.838 9 (-) Accounts Payable¹ 50 74.259 61 104.445 12

Cash Conversion Cycle 1Q14 1Q15 Change (in days)

5

.5 Operational and financial highlights

Indebtedness (R$ thousand)

Indebtedness totaled R$98.1 million in 1Q15 versus R$ 96.7 million in 1Q14 Long-term debt relevance stood at 33.0% in 1Q15 versus 38.3% in 1Q14 Indebtedness policy remained conservative, with low weighted-average cost of Company's total debt

1T14 4T14 1T15

Cash 207,553 200,385 210,149 Total debt 96,652 99,410 98,138 Short term 59,680 65,081 65,718 % total debt 61.7% 65.5% 67.0% Long-term 36,972 34,329 32,420 % total debt 38.3% 34.5% 33.0% Net debt (110,901) (100,975) (112,011)

• €
• €
• EBITDA LTM

158,113 161,299 162,122 Net debt/EBITDA LTM

• 0.7x
• 0.6x
• 0.7x

Cash position and Indebtedness

Appendix

.1 Key financial indicators

A

1Q14 1Q15 Growth or spread%

• 2.5 p.p.

• 0.8 p.p

• 11.2%

• 13.1%

• 0.9 p.p.

• 0.5 p.p.

• 0.7x
• 0.7x

Key financial indicators

.2 History – Franchises and Owned Stores

A

• 1. Includes areas in square meters of 9 international stores
• 2. Includes 7 outlet-type stores with a total area of 2,882 m2
• 3. Includes areas in square meters of stores expansion

1Q14 2Q14 3Q14 4Q14 1Q15

History of Stores

.4 Balance Sheet - IFRS

A

(R$ thousand)

• 2,120

.5 Income Statement - IFRS

A

Income statement - IFRS 1Q14 1Q15 Grow th % Net operating revenue 213,425 236,242 10.7% Cost of goods sold (121,364) (140,342) 15.6% Gross profit 92,061 95,900 4.2% Operating income (expenses): (67,981) (73,573) 8.2% Selling (47,721) (54,966) 15.2% Administrative and general expenses (19,324) (17,794)

• 7.9%

Other operating income net (936) (813)

• 13.1%

Income before financial result 24,080 22,327

• 7.3%

Financial income 2,917 8,023 175.0% Income before income taxes 26,997 30,350 12.4% Income tax and social contribution (9,564) (12,207) 27.6% Current (12,342) (14,237) 15.4% Deferred 2,778 2,030

• 26.9%

Net income for period 17,433 18,143 4.1%

.6 Cash Flow Statement - IFRS

A

Statement of cash flow 1Q14 1Q15

• (342)

IR Contacts

 Thiago Borges  Leonardo Pontes dos Reis, CFA

Phone: +55 11 2132-4300 ri@arezzoco.com.br www.arezzoco.com.br

CFO and IR Officer IR Manager

 Leandro M. V. Vieira

IR Analyst