[draft] investor meetings presentation “premium performance and timeless italian style…”

[DRAFT]

Investor Meetings Presentation

“Premium Performance and Timeless Italian Style…”

[DRAFT]

Management Presentation Team

Insert picture

Insert picture

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[DRAFT]

Company Overview

[DRAFT]

Ducati at a Glance

One of the world’s leading manufacturers and distributors of high-performance sport motorcycles since 1926 with products sold in 66 countries

Positioned as premium priced motorcycles within the “sport” sub-segment of the large-displacement motorcycle market

[5.7%] worldwide market share in the Sport segment of the >500cc Road Market(1)

Extensive racing pedigree with 13 Manufacturer’s titles since 1990 in the World Superbike Championship

38,417 motorbikes sold in 2003: net sales of €388.2m and EBITDA of €45.0m

Products through 140 Ducati stores and 732 independent multi-brand stores

One 125,000 sqm centralized production plant in Bologna (Italy)

1,149 employees at 30 September 2004

____________________(1) Source: Ducati; As of 30 Sep 2004

1

[DRAFT]

A History of Sustained Product Innovation

[Picture to come][Picture to come] [Picture to come] [Picture to come] [Picture to come]

[Picture to come][Picture to come] [Picture to come] [Picture to come] [Picture to come]

2

[DRAFT]

2004 Product Offering

Monster

• 620 Dark• 620• 1000• 1000s• S2R Dark• S2R• S4R

Multistrada

• 620 Dark• 620• 1000 DS• 1000s DS

Sport Touring

• ST3• ST4s• ST4s ABS

Superbike

• 749 Dark• 749• 749s• 749r• 999• 999s• 999r

Super Sport

• 1000 DS

[Insert Pictures]

3

$11,995-29,995 $6,595-13,495 $7,695-13,495 $11,995-15,995 $7,995-10,995

[DRAFT]

2003 Net Sales Breakdown by Country 2003 Net Sales Breakdown by Channel

Worldwide Presence

Italy29.1%

US/Canada13.1%

Japan9.9%

Rest of World14.4%

Rest of Europe33.5%

[Company to provide data]

2003 Net Sales Breakdown by Product

Motorcycles81%

Other1%

Spare Parts11%

Accessories & Apparel

7%

Superbike39%

Monster36%

Multistrada12%

Supersport6%

Sport Touring

7%

€388.2m

4

[Germany to be inserted]

[DRAFT]

Ownership Structure

Giorgio Seragnoli

7.5%

Treasury Shares2.0%

Free Float52.3% Harris

Associates LP5.0%

Texas Pacific Group33.2%

Listed on the Milan Stock Exchange in the “STAR” segment and New York Stock Exchange through ADSs since 1999

Companies traded on “STAR” meet strict requirements relating to transparency, liquidity and corporate governance

Texas Pacific Group (“TPG”) has been a controlling shareholder since 1996

Broad public shareholder base

(2)

____________________Source: Consob and Thomson as of November 2004(1) The segment of Equity with high standards(2) Vice Chairman of the Board of Directors of DMH since 1998

Columbia Wanger A.M. 1.80%

Cambiar Investors LLC 0.45%

Pioneer Investment Management Ltd. 0.32%

Leonardo SGR S.p.A. 0.20%

Arca SGR S.p.A. 0.15%

J.P. Morgan Fleming A.M. (UK) Limited 0.10%

Dimensional Fund Advisors, Inc. 0.08%

SanpaoloIMI W. M. Luxembourg S.A. 0.08%

Lemanik Asset Management 0.08%

Optima S.p.A SGR 0.07%

Pictet Asset Management UK Ltd. 0.06%

WestAM 0.04%

BIM Intermobiliare SGR S.p.A. 0.02%

Credit Suisse A. M. Funds S.p.A. 0.02%

SINOPIA Asset Management 0.01%

Gespastor S.A.,S.G.I.I.C. 0.01%

Sub Total 3.49%

Other 48.81%

Total 52.30%

Overview Shareholder Base

TPG Shareholder Interest

TPG acquired 100% of Ducati from Cagiva in 1996 in two steps for ca. [€260m]

Turnaround focused on operational efficiencies and strict costs control

TPG sold [x%] of its stake in the 1999 IPO

TPG fully support current top management without being heavily involved

Unclear commitment to Ducati if capital increase required

5

[DRAFT]

Key Highlights

FocusedMarket Niche

Technical and Design

Excellence

Performance Superiority

LoyalCustomer Base

Flexible Manufacturing

Operations

PowerfulBrand Equity

6

[DRAFT]

25%

23%

20%

14%

6%5%

3%2% 2%

0%0%

5%

10%

15%

20%

25%

30%

Brand Positioning Ducati Positioning in Relevant Market(1)

% of units [registered]

[Update]

Leading Market Position among Non-Japanese Players

____________________(1) As of 30 Sep 2004; Ducati Relevant Market is defined as Sport, Naked and Sport Touring above 398cc bikes.In 2004, the full year after the introduction of Multistrada, DRM has been widened to include Dual bikes

Function Lifestyle

Comfort

Performance

Superbike

Multistrada

Monster

Sport Touring

Sport Classic

[To be discussed]

7

[DRAFT]

Technical and Design Excellence

Traditionally Ducati has developed unique solutions for its motorbikes:

Desmodromic valves

90° L-Twin engine

Tubular trellis frame

Sound

Racing successes further boost excellence:

Possibility to test new technical innovations and design features leveraging up racing activities

Focus on cutting – edge solutions

Italian style with the most advanced technology

[Insert Pictures]

8

[DRAFT]

2004 Product Innovation

[ To Come]

9

[DRAFT]

Research & Development

Performance Superiority

Ducati Corse

Key competitive tool to maintain Ducati reputation for technical excellence and innovative design

Networked unit:

Ducati R&D strategically coordinates multiple external sources of technical and engineering skills

Strategic partnership with IDEA institute

Ducati Design Center:

Strict control of the design process

Reduced “time-to-market” and design costs

Possibility to test new technical innovations and design features leveraging up racing activities

2003 R&D expenditures at €21.4m (5.5% of sales) with 206 employees fully dedicated

Innovative projects partially financed by soft loans granted by the Government

MOTO GPRe-joined in 2003 after over 30 years

Ducati Desmosedici: Racing motorcycle powered by a 4 stroke “Double Twin” cylinder engine

2nd place in the 2003 Constructors’ Standing with Loris Capirossi and Troy Bayliss as official riders

SUPERBIKE13 times World Champion in the Superbike Championship since 1990

More single race victories than all other manufacturers combined

2 Teams: Ducati Fila and Ducati Breil

9.0

25.0

3.4

21.2

0

10

20

30

1998 2003

€m

Costs Sales

Racing Economics

10

[DRAFT]

Loyal Customer Base

Overall Loyalty Level(2)

Ducati brand loyalty is determined by satisfaction in the Ducati experience

Design, sound and image emerge as the distinctive requirements to satisfy Ducati customers

Repurchase intention is 84% among Ducati owners(1)

Weighted average actual loyalty of Ducati owners was 66% in 2002(2)

66.0%

51.0%

71.0%75.0%

0%10%

20%30%40%

50%60%

70%80%

Germany Italy USA WeightedAverage

____________________(1) Source: CSM customer research 2002 based on a sample of 300 Ducati owners(2) Source: CSM customer research 2002 and JDPowers database 2001

Italy 48

Germany 16

France 12

Benelux 8

Japan 14

UK 8

South Africa 4

USA 4

Other 26

Total 140

Ducati Monobrand Stores

Independent Multi Brand Stores

USA 158

Germany 83

Italy 81

Japan 64

France 61

Spain 32

Australia 30

UK 29

Switzerland 24

Benelux 19

Other 151

Total 732

11

[DRAFT]

Flexible Manufacturing Operations

125,000 sqm production facility located outside Bologna (Italy)

Focus on engines and motorcycles assembly and testing

Direct production of two strategic components:

Crank cases

Cylinder heads

Manufacturing outsourced to a network of sophisticated third-party suppliers

[ ] workers employed

[company to provide additional data]

[insert picture]

12

[DRAFT]

Powerful Brand Equity

Globally recognised brand [Company to provide data to support]

Marketing effort focused on:

Superior performance & technical excellence

Prestige and uniqueness

Italian style design

Racing successes to boost brand image

Ducati Stores to further improve visibility

Widespread media attention

World Ducati Weekend

[ ] employees fully dedicated to marketing efforts

[Insert Pictures]

13

[DRAFT]

Financial Information

[DRAFT]

[Financials]

12,289 10,577 12,6419,308

6,704

4,058 5,6763,812

2,818

1,020

19,659 20,125 19,600

17,991

12,958

3,081 3,638 3,481

2,275

2,1642394

6,025

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

2000A 2001A 2002A 2003A YTD

Superbike Super Sport Sport Naked Sport Touring MTS

39,087 40,016 39,534 38,417

Net Sales and EBITDA Margin

VolumesUnits Sold

Key Drivers

[ Commentary to come]

25,240

14

[DRAFT]

Untapped Potential to Grow

Strategic Pillars

Ver

tica

l E

xpan

sio

nH

ori

zon

tal

Ex

pan

sio

n

Opening two additional entry doors in the sport and dual segments to attract new bikers

Repositioning current and future product development

Enter fast growth off road and sportster segment

Developed a focused range of premium price products

Develop products targeted towards new bikers

Gain market share from competitors

Upgrade loyal customers

[Insert Pictures]

15

[DRAFT]

1996 – 2003: An Historical Perspective

TPGACQUISITION IPO

Phase 3INNOVATION

1996 1997 1998 1999 2000 2001 2002 2003 2004

Revamp brand image

Strict cost saving policy

Reduction of material wastes Lean production model

“Just in time” inventory

Total Quality Management

Lead time reduction

Reduction of new models development time

Concurrent Engineering

Design for Assembly

[Company to comment]

Phase 2EFFICIENCY

Phase 1RESUME GROWTH

1996

-200

3 CAG

R:

+20.

4%

1996

-200

3 CAG

R:

+21.

1%

Net Sales EBITDA Working Capital / Net Sales

16

[DRAFT]

1.6x 1.7x

2.1x

2.6x2.8x

0.0x

0.5x

1.0x

1.5x

2.0x

2.5x

3.0x

2000A 2001A 2002A 2003A LTM

Net Debt(1) / EBITDA EBITDA / Net Interest

Historical Capitalisation Ratio

Net Debt(1) / Net Capitalization FFO / Net Debt(1)

3.1x

5.5x 5.2x

6.6x

4.8x

0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

6.0x

7.0x

2000A 2001A 2002A 2003A LTM

0.4x0.36x

0.33x 0.31x

0.0x

0.1x

0.2x

0.3x

0.4x

0.5x

2000A 2001A 2002A 2003A LTM

40.5%

42.2%

41.3%

42.5%

42.99%

40.0%

41.0%

42.0%

43.0%

2000A 2001A 2002A 2003A 9 M 2004A

____________________(1) Excludes effect of securitisation

17

[DRAFT]

Debt Analysis

18

(1)

(2)

(3)

____________________(1) Junior notes related to the securitisation program(2) Includes €60.7m of outstanding Eurobonds, €5.8m of securitized receivables not yet transferred to the SPV and €3.3m of short term leasing(3) Soft loans granted by the Government

[DRAFT]

Asset Backed Securitisation

In December 2002 Ducati signed a five-year contract for the disposal of €60m eligible trade receivables under revolving securitisation arrangements

Business rationale:

Achieve savings of ca. €1m per year and strengthen the relationship with the dealers through the internalisation of the servicing activity

Support the distribution network through a financing tool with longer term nature than factoring contracts

Receivables are sold, without recourse, to a Law 130 SPV called Ducati Desmo Finance 1

Ducati Desmo Finance 1 finances itself through the issuance of two classes of notes

Class A Notes, underwritten by the US-based Romulus Finance conduit (which in terms issues A1/P1 rated commercial paper)

Class B Notes, for an amount of €10m and underwritten by Ducati itself

S&P and Moody’s certify that the eligibility criteria adopted for Ducati’s receivables are consistent with the A1/P1 rating of Romulus Finance

Interest on Class A notes is Euribor + 40 bps

The programme is drawn for €33m, and will be drawn by an additional €12m in 2005

19

[DRAFT]

Current Capitalisation

20

[DRAFT]

Conclusion

[DRAFT]

Appendix

[DRAFT]

Monster – The Original “Naked” Motorcycle

Introduced in 1993

11,500 units sold in the first two years of production

Essential style with fully exposed engine and bodywork

Evolution on a continuous basis:

Upgrading of the 750cc and 900cc engines to 800cc and 1000cc dual spark (2002)

Fuel injected Monster 620 ie (2004)

Successful S4R launch

Client Target:

Price Range: $6,595 – 13,495

Engine Range: 600 – 1000cc

Units sold in 2003 17,994

Units Sold Since Launch:

[company to provide data] 21

[DRAFT]

Multistrada – Rational Design, Unmistakable Style

Prototype launched in September 2001

Multipurpose sportbike offering superbike performance and a more upright position

70% of the units sold in 2003 immediately registered

Model year 2005 new launches:

Agile 620 entry-level model

High-performance 1000s DS

Client Target:

Price Range: $7,695 – 13,495


Units sold in 2003 [more than 6,000]



[DRAFT]

Sport Touring – The Ideal Gran Turismo Choice

Introduced in [ ]

Inspired by the classic European Gran Turismo tradition

Comfortable ergonomic configuration for longer rides

Complete family re-styling [company to provide timing]

Height adjustable exhaust system

Anti-block Brake System (ABS) added in 2003

Successful 3-valve ST3 Launch for model year 2004

Client Target:

Price Range: $11,995 – 15,995





[DRAFT]

Introduced in 1987

Closely derived from the motorcycles competing in the World Superbike Championship

Most advanced and highest performance motorcycles within the product mix

Constant and evolutionary development of engine and chassis technologies

Twin-cylinder Testastretta engine

Innovative aluminium alloy two-sided box-section rear swing-arm

5 “Motorcycle of the Year” awards from Motor Cycle News and Motorrad

Superbike – The Best Twin ever Produced

[company to provide data]

Client Target:

Price Range: $11,995 – 29,995




24

[DRAFT]

Launched in 1973

Entry point for the aspiring Superbike owner

Classic design, lightweight, superior handling and tight cornering ability

Signature Ducati trellis frame, advanced suspension and 992cc Dual Spark engine

[Company to provide strategy and improvements on Super Sport]

Super Sport – An Icon in Modern Motorcycling

[company to provide data]

Client Target:

Price Range: $ 7,995 – 10,995

Engine Range: 1000cc



25

[draft] investor meetings presentation “premium performance and timeless italian style…”

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