quarterly report on operations st 3 -...

QUARTERLY REPORT ON OPERATIONS AT MARCH 31st 2013

Group

TOD’S Group – Quarterly Report

March 31 s t 2013

Table of contents

TABLE OF CONTENTS

Company’s data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Corporate Governance bodies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

TOD’S Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Group’s organizational chart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Distribution network as of March 31s t

2013. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Key consolidated financial f igures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

REPORT ON OPERATIONS ................................................................ .......................... 8

Group’s activity .......................................................................................................... 9

Group’s brands ........................................................................................................... 9

Foreign currency markets .......................................................................................... 10

Main events and operations during the period .......................................................... 11

Group’s results in Q1 2013 ........................................................................................ 12

Significant events occurring after the end of the period ........................................... 18

Business outlook ........................................................................................................ 18

Guidelines for preparation of the Quarterly Report ................................................... 19

Accounting policies .................................................................................................... 19

Alternative indicators of performances ..................................................................... 20

Scope of consolidation ............................................................................................... 21

Declaration pursuant to Article 154bis (2) of the Consolidated Law on Financial

Intermediation ........................................................................................................... 21


March 31 s t 2013

1 Company’s data

Company’s data

Registered office

TOD’S S.p.A.

Via Fil ippo Della Valle, 1

63811 Sant'Elpidio a Mare (Fermo) - Italy

Tel. +39 0734 8661

Legal data Parent company

Share Capital resolved euro 61,218,802

Share Capital subscribed and paid euro 61,218,802

Fiscal Code and registration number on Compa ny Register of Court of Fermo: 01113570442

Registered with the Chamber of Commerce of Fermo under n. 114030 R.E.A.

Offices and Showrooms Dusseldorf – Kaistrasse, 2

Hong Kong – 35/F The Lee Gardens, 33 Hysan Avenue, Causeway Bay

London – Old Bond Street, 16

Milan - Corso Venezia, 30

Milan - Via Savona, 56

Milan - Via Serbelloni, 1-4

Milan - Via della Spiga, 22

New York - 450, West 15t h

Street

Paris – Rue Royale, 20

Seoul – 11/F, 609 Eonju-ro, Gangnam-Gu

Shanghai - 1717 Nanjing West Road, Wheelock Square 45/F

Tokyo – Omotesando Building, 5-1-5 Jingumae

Production facilities Comunanza (AP) - Via Merloni, 7

Comunanza (AP) - Via S.Maria, 2-4-6

Sant'Elpidio a Mare (FM) - Via Fil ippo Della Valle, 1

Bagno a Ripoli, Loc. Vallina (FI) - Via del Roseto, 60

Bagno a Ripoli, Loc. Vallina (FI) - Via del Roseto, 50

Tolentino (MC) - Via Sacharov, 41/43


March 31 s t 2013

2 Corporate Governance bodies

Corporate Governance bodies

Board of directors ( 1)

Diego Della Valle Chairman

Andrea Della Valle Vice - Chairman

Luigi Abete

Maurizio Boscarato

Luigi Cambri

Luca Cordero di Montezemolo

Emanuele Della Valle

Fabrizio Della Valle

Emilio Macellari

Pierfrancesco Saviotti

Stefano Sincini

Vito Varvaro

Executive Committee Diego Della Valle Chairman

Andrea Della Valle

Fabrizio Della Valle

Emilio Macellari

Stefano Sincini

Vito Varvaro

Compensation Luigi Abete Chairman

Committee Luigi Cambri


Control and Risk Luigi Cambri Chairman

Committee Maurizio Boscarato


Independent Directors Pierfrancesco Saviotti Chairman

Committee Luigi Abete

Luigi Cambri

Board of statutory ( 2 )

Giulia Pusterla Chairman

Auditors Enrico Colombo Acting stat. auditor

Fabrizio Redaelli Acting stat. auditor

Myriam Amato Substitute auditor

Gilfredo Gaetani Substitute auditor

Independent Auditors ( 3)

PricewaterhouseCoopers S.p.A.

Manager charged with preparing Rodolfo Ubaldi

a company’s financial report

( 1 ) Term of the off ice: 20 12-2014 (resolut ion of the Shareholders ’ meeting as of Apri l 19 t h , 2012)

( 2 ) Term of the off ice: 2013-2015 (resolut ion of the Shareholders ’ meeting as of Apri l 19 t h , 2013) ( 3 ) Term of the off ice: 2012 -2020 (resolut ion of the Shareholders ’ meeting as of Apri l 19 t h , 2012)


March 31 s t 2013

3 Tod’s Group

TOD’S Group

TOD’S S.p.A. Parent Company, owner of TOD’S, HOGAN and FAY brands and l icensee of ROGER VIVIER brand.

Del.Com. S.r.l. Subholding for operation of national subs idiar ies and DOS in I taly . TOD’S International B.V. Subholding for operation of international subs idiar ies and DOS in The Netherlands. An.Del. Usa Inc. Subholding for operation of subs idiar ies in the United States. Del.Pav S.r.l. Company that operates DOS in I taly . Filangieri 29 S.r.l. Company that operates DOS in I taly . Gen.del. SA Company that operates DOS in Switzer land. TOD’S Belgique S.p.r.l. Company that operates DOS in Belg ium. TOD’S Deutschland Gmbh Company that distr ibutes and promotes products in Germany and manages DOS in Germany. TOD’S Espana SL Company that distr ibutes and promotes products in Spain and manages DOS in Spain . TOD’S France Sas Company that distr ibutes and promotes products in France and manages DOS in France. TOD’S Luxembourg S.A. Company that operates DOS in Luxembourg. TOD’S Hong Kong Ltd Company that distr ibutes and promotes products in Far East and South Pacif ic and manages DOS in Hong Kong. TOD’S Japan KK Company that operates DOS in Japan. TOD’S Korea Inc. Company that promotes products in Korea. TOD’S Macao Ltd Company that

operates DOS in Macao. TOD’S Retail India Private Ltd Company that operates DOS in India. TOD’S (Shanghai) Trading Co. Ltd

Company that operates DOS in China.

TOD’S Singapore Pte Ltd Company that operates DOS in S ingapore. TOD’S UK Ltd Company that distr ibutes and promotes products in Great Br itain and manages DOS in Great Br itain. Webcover Ltd Company that operates DOS in Great Br itain. Cal.Del. Usa Inc. Company that operates DOS in Cal ifornia (USA). Deva Inc. Company that distr ibutes and promotes products in North America, and manages DOS in the State of NY (USA). Flor. Del. Usa Inc. Company that operates DOS in F lor ida (USA). Hono. Del. Inc. Company that operates DOS in Hawai (USA). I l. Del. Usa Inc. Company that operates DOS in I ll inois (USA). Neva. Del. Inc. Company that operates DOS in Nevada (USA). Or. Del. Usa Inc. Company that operates DOS in Cal ifornia (USA). TOD’S Tex. Del. Usa Inc. Company that operates DOS in Texas (USA). E-TOD’S Inc. E-commerce company for US market . Holpaf B.V. Real estate company. Alban.Del Sh.p.k. Production company. Sandel SA Not operating company. Un.Del. Kft Production company. Re.Se.Del. S.r.l. Company for services. TOD’S Brasil Ltda Company that operates DOS in Brazi l .


March 31 s t 2013

4 Tod’s Group

Group’s organizational chart

TOD’S S.p.A.

TOD’S International BVAmsterdam – The Netherlands

S.C. - Euro 2,600,200

An.Del. USA Inc.New York U.S.A.

S.C. - Usd 3,700,000

Del.Com S.r.l.

S.Elpidio a Mare - ItalyS.C. - Euro 31,200

TOD’S Hong Kong Ltd

Hong KongS.C. - Usd 16,550,000

TOD’S UK Ltd

London – Great BritainS.C. - Gbp 350,000

TOD’S Belgique S.p.r.l.

Bruxelles - BelgiumS.C. - Euro 300,000

TOD’S Espana SL

Madrid – SpainS.C. - Euro 468,539.77

TOD’S Japan KK

Tokio - JapanS.C. - Jpy 100,000,000

TOD’S Korea Inc

Seoul - KoreaS.C. Won 1,600,000,000

TOD’S Singapore LtdSingapore

S.C. - Sgd 300,000

Un.Del KftTata - Hungary

S.C. - Huf 42,900,000

TOD’S Luxembourg S.A.Luxembourg

S.C. Euro 31,000

TOD’S France SasParis - France

S.C. - Euro 780,000

TOD’S Deutschland GmbhDusseldorf - GermanyS.C. - Euro 153,387.56

Cal.Del. USA Inc.

Beverly Hills, Ca U.S.A.S.C. - Usd 10,000

TOD’S Tex. Del. Inc.

Dallas, Tx U.S.AS.C. - Usd 10,000

Deva Inc.Wilmington, De U.S.A.

S.C. - Usd 500,000

Flor.Del. USA Inc.Tallahassee, Fl U.S.A.

S.C. - Usd 10,000

Hono.Del. Inc.Honolulu, Hi U.S.A.

S.C. - Usd 10,000

Del.Pav. S.r.l.


Re.Se.Del. S.r.l.


Filangieri 29 S.r.l.S.Epidio a Mare - Italy

S.C. - Euro 100,000

TOD’S (Shanghai) Trading Co. LtdShanghai- China

S.C. Usd 16,000,000

TOD’S India Retail Private LtdMumbai – India

S.C. Inr 193,900,000

Webcover LtdLondon – Great Britain

S.C. - Gbp 2

Il.Del. USA Inc.Springfield, Il U.S.A.

S.C. - Usd 10,000

Neva.Del. Inc.

Carson City, Nv U.S.A.S.C. - Usd 10,000

Or.Del. USA Inc.

Sacramento, Ca U.S.A.S.C. - Usd 10,000

100%

100%

100%

99%

90%

100%

100%

100%

100%

50% 50%

Gen.Del. SAZurich – Switzerland

S.C. Chf 200,000

Sandel SASan Marino

S.C. - Euro 258,000

1%

E-TOD’S Inc.Wilmington, De U.S.A

S.C. - Usd 200100%

ALBAN.DEL Sh.p.kTirana – Albania

S.C. – Euro 720,000

100%

1% 99%

10%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

50%

50%

50%

100%

1%

100% 100%

Holpaf B.V.Amsterdam – The Netherlands

S.C. - Euro 5,000,000100%

TOD’S Macao Lda

MacaoS.C. Mop 20,000,000

TOD’S Brasil Ltda.

Sao Paulo - BrazilS.C. - Brl 8,500,000

90% 10%


March 31 s t 2013

5 Distr ibution network

Distribution network as of March 31s t

2013

Total

Greater China (**)

China

Hong Kong

Macau

Taiwan

Total

Rest of the World

Saudi Arabia

Bahrain

U.A.E.

Kuwait

Lebanon

(D)=DOS (F)=FRANCHISED STORES

Europe (D) (F)

Italy 44 4

Belgium 1

France 14 1

Germany 10

Great Britain 5

Greece 5

Luxembourg 1Netherlands 1

Portugal 1

Russia 3

Spain 2 1

Switzerland 3

Turkey 1

Total 81 16

Greater China (**) (D) (F)

China 45 1

Hong Kong 11 1Macau 1 1

Taiwan 19

Total 57 22

Americas (*) (D) (F)

U.S.A. 14 2Brazil 1

Total 15 2

Rest of the World (D) (F)

Saudi Arabia 2

Bahrain 2

U.A.E. 7

Kuwait 3

Lebanon 2

Qatar 1

Japan 28 1

Korea 14 6

Philippines 2India 1

Indonesia 4

Malaysia 3

Singapore 2 1

Thailand 3

Guam 1

Azerbaijan 1

Total 45 39

(*) Start ing with this quarter ly report on operations at March 31 s t , 2013 , the region “North America” has been replaced by “Americas”, inc luding the whole American continent (Northern and Southern America) . (**) Start ing with this quarter ly repo rt on operations at March 31 s t , 2013, we g ive separate disc losure of the region “Greater China”, which inc ludes: mainland China, Hong Kong, Macao and Taiwan.

DOS, 2013 new openings Greater China Chengdu (China) Ningbo (China) Shanghai (China)

Americas San Paolo (Brazi l) Europe Strasbourg (France) Paris (France )

Franchised stores, 2013 new openings

Rest of the World Bangkok (Thailand)

For a complete l ist of retail outlets operated by the DOS and franch ising network, reference should be made to the corporate web site: www.todsgroup.com

http://www.todsgroup.com/


March 31 s t 2013

6 Key consolidated financial f igures

Key consolidated financial figures

P&L Key figures (euro millions)

Q1 2013 Q1 2012 Q1 2011 Q1 2010

Revenues 253.5 263.2 243.7 208.1

EBITDA 63.6 25.1% 66.7 25.3% 65.1 26.7% 48.7 23.4%

EBIT 53.4 21.1% 57.3 21.8% 55.9 23.0% 41.1 19.7%

Main Balance Sheet indicators (euro millions)

3.31.13 12.31.12 3.31.12

Net Working Capital (*) 300.3 278.5 273.9

Net financial position 131.7 103.7 110.3

Capital expenditures 9.4 49.9 14.7

(*) Trade receivable + inventories - trade payable

Stock performance (euro)

The Group's employees

3.31.13 12.31.12 3.31.12 3.31.11

Year to date 3,968 3,878 3,643 3,549

Legenda:

Execut. = Executive

White Col. = White Collar

Blue Col. = Blue Collar

Q1 2013 Revenues - % by Brand

Q1 2013 Revenues - % by market

Q1 2013 Revenues - % by Product

Employees 2013: composition

TOD'S55,8%

HOGAN

27,9%

FAY5,9%

ROGER VIVIER10,3%

Other0,1%

Italy39,0%

Europe19,9%

Ameri cas

7,7%Greater China22,5%

Rest of the

World 10,9%

Shoes78,2%

Leather goods14,9%

Apparel6,8%

Other0,1%

DIR1%

IMP67%

OP32%

90,00

95,00

100,00

105,00

110,00

115,00

120,00

January - March 2013


March 31 s t 2013

7 Highlights of results

Highlights of results

Revenues: revenues totalled 253.5 mill ion euros,

decreased by 3.7% from Q1 2012. Excellent sales

performance by DOS network (+16.8%).

EBITDA: amounting to 63.6 mill ion euros in Q1

2013, EBITDA represents 25.1% on Group sales ( in

Q1 2012: 66.7 mill ion euros).

EBIT: amounting to 53.4 mill ion euros ( in Q1 2012:

57.3 mill ion euros), EBIT represents 21.1% on

Group sales.

Net financial position (NFP): Group liquid assets

amount to 191.2 mill ion euro at March 31s t

, 2013.

Net financial position was 131.7 mill ion euros at

the same date (110.3 mill ion euros at March 31s t

2012).

Capital expenditures: amounting to 9.4 mill ion

euros in Q1 2013 (14.7 mill ion euros in Q1 2012).

Distribution network: at March 31s t

, the single

brand distribution network comprised 1 98 DOS

(increased by 19 units compared to March 31s t

,

2012) and 79 franchised stores.

Revenue (Euro mln)

EBITDA (Euro mln)

EBIT (Euro mln)

Net financial position (Euro mn)

248.8 253.5 263.2243.7

208.1

Q1 2013 comp. ex. rate basis

Q1 2013 Q1 2012 Q1 2011 Q1 2010

58.263.6

66.7 65.1

48.7


Q1 2013 Q1 2012 Q1 2011 Q1 2010

47.953.4

57.3 55.9

41.1


Q1 2013 Q1 2012 Q1 2011 Q1 2010

131.7

110.3

88.8

180.2

3.31.13 3.31.12 31.03.11 31.03.10

REPORT ON OPERATIONS

Group


March 31 s t 2013

9 Report on operations

Group’s activity

TOD’S Group operates in the luxury sector under its proprietary brands (TOD’S, HOGAN, and FAY)

and licensed brands (ROGER VIVIER). It actively creates, produces and distributes shoes, leather

goods and accessories, and apparel. The Company’s mission is to offer global customers top-

quality products that satisfy their functional requirements and aspirations.

Group’s brands

The TOD’S brand is known for shoes and luxury leather goods, with styles that have became icons

of modern living; Tod’s is known in the luxury goods sector as a symbol of the perfect

combination of tradition, quality and modernity. Each product is hand-crafted with highly-skil led

techniques, intended, after laborious reworking, to become an exclusive, recognisable, modern

and practical object. Some styles, l ike the Driving Shoe and the D-bag, are cherished by

celebrities and ordinary people worldwide, and have become icons and forerunners of a new

concept of elegance, for both women and men .

Begun in the 80s with shoe collections for wo men, men and children, the HOGAN brand now also

crafts various leather goods items. The H OGAN brand is distinctive for high quality, functionality

and design. Every product stems from a highly skil led design technique and is created using

quality materials with a particular passion for details and a search for perfection. H OGAN

products are the highest expression of a “new luxury” lifestyle. H OGAN is meant for someone

who cherishes the type of luxury associated with product excellence, innovative original desi gn

and consummate practicality. The Traditional and the Interactive shoe styles endure as

continuing “best sellers” .


March 31 s t 2013


FAY is a brand created in the mid 80s with a product range of high quality casual wear. The brand

is known for its quality craftsmanship, for the excellence of its materials, a meticulous attention

to craft details and its high functionality without s acrif icing style and quality. FAY products are

wearable everywhere: from the stadium to the office, in urban areas and in the countryside. The

l ine, which has seasonal men’s, women’s and junior’s collections, focuses on classic evergreen

styles, continuously modified and refreshed with innovative and recognisably eye -catching

design.

The Fabergé of shoes, and creator of the first stiletto heel in the 1950's, Roger Vivier designed

extravagant and luxuriously decorated shoes that he described as being “scu lptures.” Today, the

artistic heritage and excellent traditional roots of the Vivier fashion house have been revived .

Under the management of Creative Director Bruno Frisoni, Vivier’s work and vision endure. New

chapters are added to this unique life story every year, which goes beyond the world of footwear

to include handbags, small leather goods, jewellery and sunglasses .

Foreign currency markets

Average exchange rates for the first quarter of 2013, compared to figures for the same period of the

previous year, show a steady trend against the main currencies with which the Group operates, with

the exception of Japanese yen, weakened of 17.3% against the European currency.


March 31 s t 2013


-1.7-2.0

-0.7

-17.3

3.3

0.6 1.4

-0.7

(20)

(15)

(10)

(5)

0

5

CHF GBP HKD JPY KRW RMB SGD USD

Average exchange rateQ1 2013 vs 2012(change %)

Main events and operations during the period

The figures for 1Q 2013 were heavily influenc ed by the impact on sales resulting from the

strategy to streamline independent distribution initiated during the previous year, and especially

in Italy, given the difficult situation prevailing there. The principal aim of this strategic choice,

which has affected all brands, but whose effects were particularly noticeable on the revenue

performance of the HOGAN and FAY brands, the most heavily exposed to the Italian market and

the independent retailer channel, has been to maintain the exclusivity and positi oning of the

brands, as well as protection of the excellent quality of the receivables portfolio.

The effect was especially pronounced in the first quarter of the year, which is historically

characterised by the prevalence of the wholesale component on s ales, and reduced consolidated

revenue by 3.7% from the same period of the previous year.

Notwithstanding these factors, marginal income was not particularly impacted by revenue

performance, in consequence of the excellent results achieved on international markets, where

aggregate revenue grew by +20.5%, being driven by the excellent performance of Greater China

(+55.4%) and the Americas (+31%), and the positive sales results on the directly operated store

network, which reported high growth even in the fir st three months of 2013 (+16.8% compared

with the same period of 2012), again being driven by the Asian markets, on which all distributed

brands have posted double-digit growth rates.

Business development is sustained by the continued evolution of the Grou p e-commerce channel,

through the extension of the United States market, in addition to the Italian market and principal

European countries, while always taking a prudent approach to preserve brand integrity.

Group commitment to social responsibility is a lso continuing without interruption. The

Shareholders’ Meeting of the parent company TOD’S S.p.A. held on April 19t h

2013 resolved to

allocate about 1.5 mill ion euros, or 1% of the net profit realised by the Group in FY 2012, to a

special reserve to be used for promoting territorial solidarity projects .


March 31 s t 2013


Group’s results in Q1 2013

In the first quarter of 2013 , TOD’S Group generated sales totalling 253.5 mill ion euros, decreased

by 9.7 mill ion euros or 3.7% over figures for the same period of the previous yea r. Exchange-rate

effect was positive: maintaining cross rates constant, sales revenues would have a mounted to

248.8 mill ion euros.

EBITDA and EBIT amounted respectively to 63.6 mill ion euros and 53.4 mill ion euros and they

represent respectively 25.1% and 21.1% of total consolidated sales revenues . Operating margins

are substantially in l ine with the same period of the previous year, when EBITDA and EBIT were

25.3% and 21.8% of consolidated sales revenue.

Euro 000's

FY 12 Main economic indicators Q1 2013 Q1 2012 Change %

963,132 Sales revenues 253,519 263,174 (9,655) (3.7)

250,167 EBITDA 63,635 66,704 (3,069) (4.6)

(41,330) Deprec., amort., write-downs and adances (10,269) (9,440) (828) 8.8

208,837 EBIT 53,366 57,264 (3,898) (6.8)

Foreign exchange impact on revenues (4,767)

Adjusted ricavi 248,751 263,174 (14,422) (5.5)

Foreign exchange impact on operating costs (678)

Adjusted EBITDA 58,190 66,704 (8,514) (12.8)

Foreign exchange impact on deprec.& amort. (45)

Adjusted EBIT 47,876 57,264 (9,388) (16.4)

EBITDA % 25.1 25.3

EBIT % 21.1 21.8

Adjusted EBITDA % 23.4 25.3

Adjusted EBIT % 19.2 21.8

(Euro/000)

Euro 000's

3.31.12 Main Balance Sheet indicators 3.31.13 12.31.12 Change

273,891 Net Working Capital (*) 300,339 278,498 21,841

110,313 Net financial position 131,746 103,741 28,005

14,735 Capital expenditures for tangible and intangible 9,430 49,895 (40,465)

(*) Trade receivable + Inventories - Trade payable

Revenues. Consolidated sales were 253.5 mill ion euros in the first quarter of 2013, down 3.7%

from Q1 2012. At constant exchange rates, meaning by using Q1 2012 average exchange rates,

sales would have been 248.8 mill ion euros, down 5.5% from Q1 2012.


March 31 s t 2013


The DOS network posted very good results; revenues through DOS globally amounted to 132.3

mill ion euros in Q1 2013, up 16.8% from Q1 2012 (+13.5% at constant exchange rates), driven by

the solid organic growth and by the widening of the DOS network.

The Same Store Sales Growth (SSSG) rate, calculated as the worldwide average of sales growth

rates at constant exchange rates registered by the DOS already existing as of January 1st, 2012,

was 5.1% for the first 19 weeks of 2013 (from January 1st to May 12th, 2013).

As of March 31st, 2013 the Group’s distribu tion network was composed by 198 DOS and 79

franchised stores, compared to 179 DOS and 68 franchised stores as of the end of March 2012 .

In the first quarter of 2013, TOD’S sales were 141.6 mill ion euros, up 3% from Q1 2012 (+0.6% at

constant exchange rates). The HOGAN brand total led 70.8 mill ion euros of sales in Q1 2013,

compared to 89.6 mill ion euros of the same period of 2012. As already reminded, the brand’s

performance in Italy is negative, mostly due to the already commented rationalization of the

wholesale distribution; in the same time, the brand is achieving positive results abroad, mainly in

the Asian markets, where its international expansion is currently focused .

In Q1 2013, revenues

to third parties

totalled 121.2 mill ion

euros; the 19.1%

difference compared

to the same period of

2012 is due to the

already commented

rationalization of the

independent

distribution mainly in

Italy.

(Euro mn) Q1 2013 % Q1 2012 % var. ass. var. %DOS 132.3 52.2 113.3 43.1 19.0 16.8Third Parties (WS) 121.2 47.8 149.9 56.9 (28.7) (19.1)Totale 253.5 100.0 263.2 100.0 (9.7) (3.7)

DOS52,2%

Third Parties (WS)

47,8%

DOS DOS

Third Parties (WS)

Third Parties (WS)

020406080

100120140160180200220240260

Q1 2013 Q1 2012


March 31 s t 2013


results achieved in the last quarters, confirming its growth as one of the most prestigious brands

of luxury shoes and accessories in the more exclusive segment of luxury goods in the world. In Q1

2013, its sales totalled 26 mill ion euros, more than doubled compared to the same period of 2012

(+91.7% at constant exchange rates) .

Sales of shoes tota lled 198.2 mill ion euros in Q1 2013, up 1.2% from Q1 2012 ( -0.8% at constant

exchange rates), thus confirming the undisputed Group’s leadership in the core business of

implemented on the wholesale channel; on the contrary, the performance of this product

category is positive in the DOS channel .

In Q1 2013, sales of apparel were 17.3 mill ion euros; the difference compared to the same period

of 2012 broadly reflects the already commented performance of the FAY brand.

In Q1 2013, sales of

the FAY brand, which

are mainly registered

in Italy and through

the wholesale channel,

were 14.9 mill ion

euros, compared to 23

mill ion euros of the

same period of 2012.

Finally, ROGER VIVIER

is repeating also this

year the excellent

(Euro mn) Q1 2013 % Q1 2012 % var. ass. var. %TOD'S 141.6 55.8 137.5 52.2 4.1 3.0HOGAN 70.8 27.9 89.6 34.1 (18.8) (21.0)FAY 14.9 5.9 23.0 8.7 (8.1) (35.2)RV 26.0 10.3 12.9 4.9 13.1 101.5Other 0.2 0.1 0.2 0.1 0.0 n.s.Totale 253.5 100.0 263.2 100.0 (9.7) (3.7)

TOD'S55,8%

HOGAN27,9%

FAY5,9%

RV10,3%

TOD'S TOD'S

HOGAN HOGAN

FAYFAY

RV RV

020406080

100120140160180200220240260

Q1 2013 Q1 2012

shoes. Sales of leather

goods and accessories

globally amounted to

37.7 mill ion euros in

Q1 2013. The 5.5%

difference compared

to the same period of

2012 (-7.6% at

constant exchange

rates) is mainly due to

the impact of the

rationalization


March 31 s t 2013


In the first quarter of 2013, domestic sales were 98.9 mill ion euros; the difference compared to

the same period of 2012 is mainly due to the already commented rationalization of the wholesale

2013, up 31% from Q1 2012 (+25.6% at constant exchange rates). Outs tanding results in both the

channels (DOS and wholesale), as a signal of the huge growth potential of this market for the

Group. Outstanding growth in Greater China during the first quarter of 2013: 55.4% or 44.2% at

constant exchange rates. T he Group’s sa les amounted to 57.2 mill ion euros in Q1 2013 and

represented 22.5% of consolidated sales as of March 31st, 2013. Finally, in the remaining area

“Rest of the World”, the Group’s sales tota l led 27.6 mill ion euros in Q1 2013, up 13.5% from Q1

2012 (+15% at constant exchange rates) .

O p e r a t i n g r e s u l t s . EBITDA was 63.6 million euros in Q1 2013, and represents 25.1 % of consolidated

revenues. The comparable figure for Q1 2012 was 66.7 million euros, or 25.3 % of sales. On a

comparable exchange rate basis, EBITDA would have been 58.2 million euros, or 23.4% of sales.

distribution. In the rest

of Europe, the Group’s

performance was slightly

negative; in this area

revenues totalled 50.4

mill ion euros in Q1 2013

(-3.8% compared to Q1

2012); The American

market confirmed its

solid double-digit

growth; sales total led

19.4 mill ion euros in Q1

(Euro mn) Q1 2013 % Q1 2012 % var. ass. var. %Italy 98.9 39.0 134.9 51.3 (36.0) (26.7)Europe 50.4 19.9 52.4 19.9 (2.0) (3.8)Americas 19.4 7.7 14.8 5.6 4.6 31.0Greater China 57.2 22.5 36.8 14.0 20.4 55.4Rest of the World 27.6 10.9 24.3 9.2 3.3 13.5Totale 253.5 100.0 263.2 100.0 (9.7) (3.7)

Italy39,0%

Europe19,9%

Americas

7,7%

Greater China22,5%

Rest of the

World10,9%

ItalyItaly

Europe

EuropeAmericas

AmericasGreater China

Greater China

Rest of the World

Rest of the World

020406080

100120140160180200220240260

Q1 2013 Q1 2012


March 31 s t 2013


Euro 000'sQ1 2013 Q1 2012 FY 12

Revenues

Sales Revenues 253,519 263,174 963,132

Other revenues and income 2,394 3,059 22,060

Total revenues and income 255,913 266,233 985,192

Operating Costs

Change in inventories of work in prog. and finis. goods 4,276 4,900 33,456

Cost of raw materials, supplies and materials for cons. (75,445) (77,292) (282,779)

Costs for services (53,466) (65,589) (226,049)

Costs for use of third party assets (23,538) (18,975) (85,747)

Costs of labour (37,320) (34,929) (143,004)

Other operating charges (6,785) (7,644) (30,902)Total Operating costs (192,278) (199,529) (735,025)

EBITDA 63,635 66,704 250,167

Amortisation, depreciation and write-downs

Amortisation of intangible assets (2,090) (2,229) (8,935)

Depreciation of tangible assets (7,462) (7,011) (29,154)

Other adjustment (246)

Total amortisation, depreciation and write-downs (9,552) (9,240) (38,335)

Provisions (717) (200) (2,995)

EBIT 53,366 57,264 208,837

After charging about 9.6 mill ion euros for depreciation and amortisa tion, EBIT in January-March

2013 was 53.4 mill ion euros and represents 21.1% of consolidated sales. In Q1 2012, EBIT was

57.3 mill ion euros, equal to 21.8% of consolidated sales. On a comparable exchange rate basis,

EBIT would have been 47.9 mill ion euros, or 19.2 % of sales.

In Q1 2013 Group operating profit benefits from the continuing increase of contribution margin,

caused by both the most favourable geographical composition of revenue and greater importanc e

of sales from DOS network in respect of last quarter, especially performed in geographical areas

with higher margins (Greater China and USA). Margins increase was absorbed by the evolution of

some type of costs related to the business develop ment. In particular, costs for the use of third

party assets (rents for locations and royalties for l icenses) increased from 19.0 mill ion euros,

registered during the first three months of 2012, to 23.5 mill ion euros of the current quarter,

achieving a percentage on revenue for the first three months of 2013 equal to 9.3% (last quarter

was 7.2%). This increase is mainly related to sales growth of direct distribution network in Asian

markets where the retail distribution model is mainly characterized by variable rents on sales.

Group headcount continued to grow, rising by 325 persons in respect to the previous period

(from 3,643 employees to 3,968 at March 31s t

, 2013). The total cost for personnel was 37.3

mill ion euros (34.9 mill ion euros in Q1 2012), growing by 6.8 %. The increase is mainly related to

headcount growth for the support of distribution network. Personnel costs as a percentage of

sales rose from 13.3% in Q1 2012 to 14.7% in Q1 2013 .


March 31 s t 2013


Capital expenditures. Capital expenditure totalled 9.4 mill ion euros in Q1 2013 (14.7 mill ion

euros in Q1 2012). Expenditures dedicated to the DOS network totalled about 4.6 mill ion euros,

and they relates to the sett ing up of new DOS. The

remaining capital expenditures made during the

period covered not only normal modernisation of

structures and industrial equipment (mainly forms,

lasts and moulds), but also acquisitions for

software development.

INVESTMENT BY ALLOCATION

DOS49%

Prod.20%

Other31%

The net financial position. At the end of the quarter under consideration, net f inancial position

totalled 131.7 mill ion euros, increased by 28,0 mill ion euros in respect of the beginning of the

year (103.7 mill ion euros at December 31s t

, 2012), and it is composed by cash for 191.2 mill ion

euros and financial l iabilities for 59.5 mill ion euros.

3.31.12 3.31.13 12.31.12 Change

Current financial assets

180,177 Cash and cash equivalents 191,202 168,329 22,873

180,177 Cash 191,202 168,329 22,873

Current financial liabilities

(28,069) Current account overdrafts (25,621) (27,025) 1,404

(5,261) Current share of medium-long term financing (5,132) (5,540) 408(33,330) Current financial liabilities (30,753) (32,565) 1,812

146,847 Current net financial position 160,449 135,764 24,685

Non-current financial liabilities

(36,534) Financing (28,703) (32,023) 3,320

(36,534) Non-current financial liabilities (28,703) (32,023) 3,320

110,313 Net financial position 131,746 103,741 28,005

Net financial position Euro 000's

Positive effects on cash have been generated by net working capital reduction especially

considering that the typical f inancial trend of the business for the first quarter is generally

characterized by an absorption of l iquid assets necessary for f inancing the temporary growth of

net working capital, mainly related to the exposure versus independent customers , directly

consequence of wholesale revenue component which generates cash during the second quarter.


March 31 s t 2013


This result has been achieved also thanks to the contribution of a careful supply chain process

management which produced efficiency along the entire production chain .

3.31.12 3.31.13 12.31.12 Change

242,328 Inventories 274,554 265,389 9,165

210,816 Trade receivables 174,701 152,345 22,356

(179,254) Trade payables (148,916) (139,236) (9,680)

273,890 Net working capital (300,339) 278,498 21,841

Net working capital Euro 000's

At the financial level, the FY 2012 dividend coupon is scheduled to be paid on May 20t h

, as

approved by the Shareholders’ Meeting of the parent company TOD’S S.p.A. o n April 19t h

, 2013.

The dividend, totalling 82.6 mill ion euros, at the rate of 2.70 (two/70) per each of the 30,609,401

shares comprising the share capital at the payment date, will be paid to all the shareholders

entered on the Register of Shareholders at the coupon payment date.

Significant events occurring after the end of the period

There have not been any significant operating events affecting the Group’s activities since March

31s t

, 2013.

Business outlook

As expected the first quarter results are the natural consequence of the strategy adopted by the

Group in response to the market situation. Extreme prudence and caution in Italy are

accompanied by rapid international expansion. Special attention has been dedicated to the

Chinese and American markets , where the brands are proving to have strong potential. The Group

is growing consistently with the DNA of its brands, without compromising their prestige and

integrity. Customer appreciation of the Group’s products continues to grow, in recognition of

their quality and exclusivity.

Considering the good results of the DOS network and the trend of the orders’ backlog, the Group

may register growth in revenue and profits again this year .


March 31 s t 2013


Guidelines for preparation of the Quarterly Report

TOD’S Group Quarterly Report on Operations at March 31s t

, 2013 was prepared pursuant to

Article 154 ter (5) of the Consolidated Law on Financial Intermediation (“TUF”) introduced by

Legislative Decree 195/2007, in implementation of Directive 2004/109/EC (the “Transpare ncy

Directive”).

Quarterly report were approved by the Board of Directors of TOD’S S.p.A. on May 1 4t h

, 2013, and

on the same date that body authorized its publication.

Accounting policies

The accounting policies applied to prepare the financial f igures re ported on the Quarterly Report

at March 31s t

, 2013 was prepared by applying IAS/IFRS, issued by IASB and approved by the

European Union at the reporting date. IAS/IFRS refers to the International Accounting Standards

( IAS), International Financial Reporting Standards ( IFRS), and all interpretative documents issued

by the IFRIC (previously called the Standing Interpretations Committee).

The same accounting standards used to prepare the consolidated financial statements at

December 31s t

, 2012 were used to prepare this Report.

Preparation of the financial f igures reported on the Quarterly Report at March 31s t

, 2013 entails

making estimates and assumptions based on the management’s best valuation. If these estimates

and assumptions should change in future fr om the actual circumstances, they will obviously be

modified for the period in which those circumstances changed.

Specifically in regard to determination of eventual impairment losses affecting fixed assets,

complete tests are performed only when the annua l report is prepared, when all information as

might be necessary is available, unless there are indications that require immediate valuation of

eventual impairment losses or the occurrence of events that required repetition of the

procedure.

The rates appl ied for translation of the financial statements of subsidiaries using a functional

currency other than the currency used for consolidation, are il lustrated in the following table and

compared with those used in the previous period :


March 31 s t 2013


Exch. rates at

period end

Average

exch. rate

Exch. rates at

period end

Average

exch. rate

U.S. dollar 1,281 1,320 1,336 1,311

UK pound sterling 0,846 0,851 0,834 0,834

Swiss franc 1,220 1,228 1,205 1,208

Hong Kong dollar 9,942 10,238 10,371 10,172

Japanese yen 120,870 121,810 109,560 103,810

Hungarian forint 304,420 296,490 294,920 296,490

Singapor dollar 1,590 1,634 1,678 1,657

Korean WON 1.425,03 1.433,15 1.512,98 1.482,65

Macao Pataca 10,240 10,545 10,676 10,472

Chinese Renminbi 7,960 8,217 8,409 8,269

Indian Rupia 69,566 71,511 68,042 65,864

Brazilian Real 2,570 2,633 n.a. n.a.

Jan. - Mar. 2013 Jan. - Mar. 2012

Alternative indicators of performances

In order to strip the effects of changes in exchange rate s in respect to the average values o f the

first three months of 2012 from the results for the three months of 2013, the typical economic

indicators (Revenues, EBITDA, EBIT) have been recalculated by applying the average exchange

rates for the three months of 2012, thereby rendering them fully comparable with those of the

previous period.

However, it should be pointed out that these principles for measuring corporate performance

represent a method of interpreting results that is not envisaged in IAS/IFRS, w hile they must not

be considered substitutes for the results calculated according to those principles.

TOD’S Group engages in a business that, despite the effects related to monthly differences in the

f lows of revenues and costs generated by its industria l activity over the course of the year, it

does not manifest significant seasonal or cyclical changes in overall annual sales .

For this reason, analysis of the interim operating results and financial indicators (revenues,

EBITDA, EBIT, f inancial position a nd working capital) cannot be considered fully representative,

and it would be incorrect to consider the period indicators referred to in this report as

proportionate to the whole year’s results .


March 31 s t 2013


Scope of consolidation

The scope of consolidation at March 31s t

, 2013 changed in respect to March 31s t

, 2012 due to the

deconsolidation of Formapura in connection with the merger by incorporation into TOD’S S.p.A.

occurred on August 1s t

, 2012 and the consolidation of TOD’S Brasil Comércio de Artigos de Couro

Ltda, created on May 4t h

, 2012. Compared with December 31s t

, 2012 there are no changes in the

scope of consolidation.

Sant’Elpidio a Mare , May 14t h

, 2013

The Chairman of the Board of Directors

Diego Della Valle

Declaration pursuant to Article 154bis (2) of Consolidated Law on Finance - TUF

The manager charged with preparing the company’s f inancial reports certif ies, pursuant to Article

154bis (2) of the Consolidated Law on Finance - TUF, that the accounting information presented

in this document corresponds to the accounting documents, books, and ledger entries.

The manager charged with preparing the company’s f inancial reports

Rodolfo Ubaldi

quarterly report on operations st 3 -...

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