1 1 Company Overview

2 Brands

3 Growth Drivers

4 Financial Highlights

2 1 Company Overview

2 Brands

3 Growth Drivers

4 Financial Highlights

3 Who we are

 The largest Brazilian and apparel company in Latin America

 Brands that lead markets with strong growth prospects

SANDALS SPORTING GOODS LUXURY APPAREL

 Global business: - operations in , , Europe and the USA - exports to 85 countries

 Flexible sourcing

 Multi-channel distribution model

 Consistent results and healthy capital structure

4 Business breakdown

Revenue by brand Revenue by region 2012: R$3.0 billion 2012: R$3.0 billion

Volume by product Volume by channel in Brazil 2012: 265,3 million pairs/units 2012: 226,6 million pairs/units

5 Attractive portfolio

6 Flexible sourcing

Installed Capacity

BRAZIL

 Sandals: • 2012: 255 million pairs/year • 2014: 355 million pairs/year

 Athletic footwear: • 13 million pairs/year

ARGENTINA

 Athletic footwear: • 11 million pairs/year

VIETNAM, CHINA AND INDONESIA

 Import of sporting apparel and footwear

7 Global distribution

Havaianas is sold in 85 countries Flagship stores (2012)

Number of Brazil Abroad Total stores Havaianas 281 101 382 Timberland 18 - 18 Topper - 12 12 Meggashop 19 - 19 Outlet -1717 Alpargatas Osklen 64 6 70 Total 382 136 518

Points of sale

BRAZIL ARGENTINA USA, EUROPE TOTAL AND EXPORTS

170,000 1,500 10,000 181,500

8 Lean management structure

CEO

Business Units Corporate Functions

Sandals Industrial

Sporting Goods Supply Chain

Luxury apparel Financial & IT

Argentina Human Resources

Legal

Strategic Planning

9 1 Company Overview

2 Brands

3 Growth Drivers

4 Financial Highlights

10 Brand Identity Products

 Most well known Brazilian consumer brand worldwide

 Among the 10 most valuable brands in the Brazilian retail market in 2013, according to Interbrand

 50 years in 2012, with more than 4 billion pairs sold

 International recognition:

55% of the Europeans know the brand 33% of the Americans 91% of the Australians

Media Coverage Distribution Channels

Vogue China San Francisco Macy’s Natalie Portman Flagship stores Brazil International 382

Own stores 2 12 14

Third-party operations (Franchises, concessions 279 89 368 Marie Claire and distributors) Vogue India Multi brand 150,000 10,000 (points of sale)

11 Stores in Brazil

Concept store in São Paulo Franchise store in São Paulo

Stores abroad

Barcelona Madrid London Milan

12 Franchises in Brazil (279) Franchises – general information

NORTH 4%  Average monthly sales: US$34,000 h  Average monthly volume: 3,000 units h NORTHEAST 12% h  Average ticket: US$21 h h h h h  Annual sales per sqm: US$20,000 h h h h h  Same stores sales (2012x2011): h h  volume: 4,5% h  sales: 8,1% h h h hh h h h Fast growth in the number of franchises h CAGR = 42% h h h 09-13 MIDWEST 9% h h h h h hh h hh h h h h h h hh hh h hh h h hh hhh SOUTHEAST 70% h hh

SOUTH 5%

13 Brand Identity Products

 Leading brand in running performance in Brazil

 Wave: state of the art cushioning technology

 Product categories: running, football, and judo

 Licensed brand since 1996

Media Coverage Distribution Channels

Flagship stores Brazil

Own stores -

Third-party operations (Franchises, concessions - and distributors)

Multi brand 5,000 (points of sale)

14 Brand Identity Products

 Most renowned football brand in Brazil

 Leading sporting goods brand in Argentina

 Product categories Brazil: football, casual, running and rugby

 Product categories Argentina: football, , casual, running, rugby, and fitness & training

Media Coverage Distribution Channels

Flagship stores Brazil Argentina 382

Own stores - 12 14

Third-party operations (Franchises, concessions - - 368 and distributors)

Multi brand 5,500 1,500 (points of sale)

15 Brand Identity Products

 Brazil’s pioneering sporting goods brand, with the first 100% Brazilian cushioning system

 Product categories: running and casual

Media Coverage Distribution Channels

Flagship stores Brazil

Own stores -

Third-party operations BR (Franchises, concessions - and distributors)

Multi brand 5,000 (points of sale)

16 Brand Identity Products

 Global premium outdoor brand

 Product categories: adventure and casual

 Licensed brand since 1996

Media Coverage Distribution Channels

Flagship stores Brazil

Own stores 11

Third-party operations (Franchises, concessions 7 and distributors)

Multi brand 1,500 (points of sale)

17 Brand Identity Products

 Most renowned Brazilian luxury apparel brand

 Product categories: , casual and collection

 Reference in sustainability

 Added to Alpargatas’ portfolio in March 2013

Media Coverage Distribution Channels

Flagship stores Brazil International 70

Own stores 38 6 44

Third-party operations (Franchises, concessions 26 - 26 Sting Madonna and distributors)

Multi brand 370 na (points of sale)

18 1 Company Overview

2 Brands

3 Growth Drivers

4 Financial Highlights

19 Sandals

How will we grow? Brazil’s sandals market (million of pairs)

 Consolidating Havaianas as a dominant brand in Brazil: CAGR 12-14 = 6% - Innovation - Communication - Distribution - Brand extension

Expanding international presence: - New markets - Brand expansion - Exclusive stores

 Increasing production capacity

Source: Kantar WorldPanel, GfK and Alpargatas’ estimates

20 New sandals plant

Location: Montes Claros, State of Minas Gerais Focus: higher value added sandals Inauguration: 2Q13 Capacity: 105 million pairs/year Cost saving: 10% to 15%

Technology Social and Environmental Projects

 Automatic feeding and dosing systems  Natural lightning and ventilation, capture and use  Continuous production system of rain water, solar energy, waste recycling  Automatic rubber cutting

 Initiatives of the Alpargatas Institute and Advantages: Standardization, agility and inauguration of the Alpargatas Museum reduction of losses

21 Athletic footwear

How will we grow? Brazil’s athletic footwear market (million pairs)  Consolidating leadership in Brazil: - Mizuno: running - Topper: football CAGR = 4.1% - Rainha: casual 12-14 - Timberland: adventure 131 125 CAGR12-14  Entering new categories: 121 - Topper: running and rugby - Mizuno: football and volley Running 7% - Rainha: volley

Football 27%  Creating strong regional sporting brands: Casual - Topper: 6% - Mizuno: Argentina

Other -11%  Expanding retail: new Mizuno Sports stores in Rio and Sao Paulo

Source: Kantar WorldPanel, GfK and Alpargatas’ estimates

22 Athletic footwear

23 1 Company Overview

2 Brands

3 Growth Drivers

4 Financial Highlights

24 Peer comparison

ALPARGATAS NIKE ASICS MIZUNO VF.Co Last balance sheet released 12/31/2012 5/31/2011 12/31/2012 3/31/2011 3/31/2011 12/31/2012

Net Revenue 1.5 24.1 19.6 3.1 2.0 10.9 (US$ billion)

Net Revenue CAGR 16% 6.7% 8.3% 2.3% (2.9%) 9.2% (last five years)

EBITDA 0.2 3.4 1.9 0.3 0.1 1.7 (US$ billion)

EBITDA CAGR 14% 5.8% 2.7% (0.7%) (7.1%) 11.3% (last five years)

EBITDA Margin 14% 14% 9.8% 10.2% 5.1% 15.3%

ROE 21.4% 22% 13.5% 10% 4.1% 22.5%

Source: Companies’ earnings releases

25 Net sales (R$ million)

CAGR 09-12= 16%

3,007

2,575 2,232 1,927

26 Sales volume (million units)

CAGR 09-12= 6.6%

265.3 249.6 244.0 218.9

27 Gross Profit (R$ million)

CAGR 09-12= 15%

1,273 1,154 1,018 831

Gross Margin

- Domestic 46% 48% 49% 45% - Havaianas International 56% 61% 50% 55% -Argentina 27% 28% 27% 25%

Consolidated 43% 46% 45% 42%

28 EBITDA (R$ million)

CAGR 09-12= 13%

414 401 405

290

EBITDA Margin

- Domestic 18% 21% 19% 16% - Havaianas International -6% 2% 0% 10% -Argentina 12% 13% 11% 6%

Consolidated 15% 18% 16% 14%

29 Cash net of debt (R$ million)

30 Shareholders’ compensation (R$ million)

Average in the Payout 24% 29% 26% 39% Brazilian consumer sector

Dividend Yield 0.6% 1.7% 1.5% 2.1% 1.4% (base March 31, 2013)

31 Stock performance

Average in the (March 31, 2013) Brazilian consumer sector P/E 18.5x 38.3x (base March 31, 2013)

32 Corporate structure

100% 100% 100% 18.7% 100% Alpargatas Alpargatas Alpargatas Tavex Cia. Brasileira Argentina USA Europe Corporation de Sandálias (Spain) (Brazil)

Common shares Preferred shares Market cap 199,676,488 189,124,980 388,801,468

Camargo Corrêa Silvio Tini Group Treasury Free Float 33 IR Team

 José Roberto Lettiere – CFO and IRO [email protected] 55 11 3847-7406

 José Sálvio Moraes – IR Manager [email protected] 55 11 3847-7397

 Mariane Weger – IR [email protected] 55 11 3847-7672

 Bruno Keinradl Monteiro – IR [email protected] 55 11 3847-7465

34 HISTORY OF GROWTH AND INNOVATION

Foundation GrowthGrowth andand LeadershipLeadership andand Global Footprint Foundation CreationCreation RecognitionRecognition Global Footprint

• Foundation in • With the launching • Alpargatas receives the Mauá • Havaianas, one of the 1907 of Conga and award, sponsored by the São most important Brazilian th • Begins production Bamba sneakers, Paulo Stock Exchange and brand of the 20 century, of Alpargatas Alpargatas initiates Jornal do Brasil, for its conquers store windows a new era in relationship with the capital Roda and worldwide footwear in Brazil market Encerados • Alpargatas expands its Locomotiva • Creation of • Elected the best in its sector retail business and ends brands in São Havaianas sandals by Exame Magazine 2010 with 212 stores in 4 Paulo • In 1970´s the • New factories are opened in countries • Driven by the Company launches Campina Grande, Santa Rita • Camargo Corrêa S.A. Brazilian Topper and acquires and João Pessoa, in Paraíba becomes the main economic growth, Rainha brand State, Northeast of Brazil shareholder of Alpargatas Alpargatas lists • Beginning of Havaianas • Several awards related to its shares the turnaround with the marketing and brand São Paulo Stock launching of Havaianas Top recognition Exchange in 1913 • Licenses of Mizuno and • Startup of its own Timberland brands to the operations in Europe and Brazilian market in the United States • Havaianas sales hit an all- • Acquisition of Alpargatas time record: one hundred Argentina million pairs are sold • Creation of Alpargatas’ Institute, the social arm of the Company 1900s1900s 1950s1950s 1960s1960s 1970s1970s 1980s1980s 1990s1990s 2000s2000s

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