Corporate Profile2005

Version 0.5a

Keeping Iceland Warm Since 1926

• 66°North was the brainchild of Hans Kristjánsson, who began producing protective clothing for the fishermen of Súgandafjörður a small fishing village.

• Quality was of paramount importance, as the livelyhood of Icelandic fishermen depended on their ability to battle the elements while attempting to secure boatloads of cod from the cold Atlantic.

• As the company expanded, lessons learned from the outfitting of fishermen were used to develop work wear for fish processors farmers, construction laborers, and other workers.

From Then to Now1926 Sjóklæðagerð Íslands hf. Founded in Súgandafjörður

and production starts in fishermans clothing.

1928 The company moves to Skerjafjörður in neigbourhood of Reykjavík employing over 100 people.

1941 The factory burns and the company moves to Reykjavík.

1966 New owners Sjóklæðagerð Íslands hf. merges with Max hf.

1977 The company takes up the brand 66°North.

From Then to Now

1999 Focus more on marketing and outdoorwear.

2001 New corporate headquarters in Garðabær.Export of outdoorwear to Europe.

2004 Export of outdoorwear to North-America started ahead of schedule because of demand.

Product Development

• Iceland is known as a country of contrasts,shifting in the blink of an eye from ice-cold to ultra-hot environs. Clothing born in this land is nothing, if not practical and adaptable.

• Clothing is perfected with rigorous testing by extreme athletes and renowned Icelandic rescue teams.

• In a country where glaciers, waterfalls, geysers and hotspring outnumber residents outerwear is taken extremely seriously.

New Corporate Image

The logo 66°North IcelandUsed for all production, PR material and handouts.

• The shopsCoordinated image for shops.

• The productsLabled to segments.

• The objectiveTo create a leading brand

New head quarters

• New corporate headquarters in useAugust 2001 - 3,200 sqm floor space

• Administration

• Warehouse for all products

• Design and product development

• ProductionSample making during development and testingScreen printing / Embroidery

New Shop Concept

The entrance The shoe testing area

Street view

66°NORTH Retail Stores

Lækjargata

Bankastræti

Kringlan

Faxafen

Miðhraun

Latvia

Netherlands

Two new shop to be opened in one month time.

Outdoor wear

Outdoor wear

Outdoor wear

Outdoor & workwear

Outdoor & workwear

2 outdoor stores

Franchise agreement

Overseas Development

• The focus is on overseas marketing already established has changed

• USA, Benelux, Norway, Sweden, UK, Ireland, Canada, Faroe Islands.

• Plans call for increased marketing activities

• Competitive price

• High quality Product – Technical development

• Exclusive test and development market

• Cooperation with distributors

• Investment in established companies possible

• The majority and control will remain

• Product development geared for overseas markets

The factory in Saldus Latvia

About Saldus• 14,000 inhabitants about • located 100 km west of Riga

About the factory• Rebuildt to ensure productivity• 150 emloyees• Production: Sea and rainwear,

Workwear, Fleece clothes• Own factory space

New factory in Aizpute - LatviaAbout Aizepute

• 5,600 inhabitants

• located 60 km west of Saldus

• High unemployment

• Few jobs available for ladies

About the factory

• House bought from the Municupality July 2004

• Three floor building ca. 1000 m2

• Reconstruction start Oct 2004

• Production started in January 2005

• Estim. to have 90 sewers in the end of the year 2005

• The factory will be runned from Saldus

Development in Iceland

• The Icelandic market competitive

• Imports from the Far East

• Produced by contractors – not own factories

• Companies come and go leaving burned ground

• Important to fight and be price competitive

• Hurtful to move the production knowledge overseas

• Decision not to use contractors – own production control

• Main issue to keep quality and product development

Product development

• Active product development in all areas

• Progress development in sea and rainwear

• New and better materials

• Product development with end-users

• Outdoor lines increasingly popular

• Important to maintain active product development

• Many styles produced

• Workwear – increased demand for new lines and functionality• Quality and comfort• Design - materials

• Important to maintain a strong design departement

Our Product Range

WorkwearSea & Rainwear Children Wear Outdoor Wear

Sea and Rainwear Collection

• 66°North is proud of its roots as a producer of sea, rain and safety clothing developed through the years with theseaman and rescue teams hand in hand.

• 66°North fisherman’s clothing has gained worldwide reputation as topquality sought after gear.

• 66°North is proud to continue its development and design of quality clothing for the seafarers.

Workwear Collection

• 66°North is the leading Icelandicproducer of work and winter wear withdevelopment done with the actual usersthemselves in the Icelandic conditions.

• 66°North fills in own gaps with imports of leading brands of work wear to fulfill its customers demand for quality clothing for all applications.

• 66°North is constantly adding new designs anddevelopment to its current work and winter lines.

The Outdoor Collection

High Performance The top-end expedition wear

Active wear Solid wear for alpinism and excursions

Travel & Leisure All-round sportswear

Next-to-skin layer The common base for the whole collection

Accessories A technical and comfortable line

Children Wear Collection

We have an immediate input from our group of “small experts” in developing and testing thanks to the frequent presence of perfect climatic test conditions.

Children wear is not a visual copy of adultsgarment with less expensive materials, but rather understand children needs and their use of the garment.

Before moving the production to Latvia

• Running 6 smalls factories, due to difficulties to get people.

• No profit

• Revenues decreased over 20%because of bad prices

• Hard competition from the Baltics states, our competitors working with contractors there.

Before moving to Latvia

• Six factories producing around in Icelanddue to difficulties to hire people onlow saleries

• Saleris cost increasing rapidly.

• Negative discussion about companies paying low saleries.

• Revuneus decreased over 20% for the last two years.

• Hard compitition from the Baltics contries throughfrom our competitors.

After moving the production to Latvia

• Production cost down.

• Productivity increase.

• Saleries from over 50% of directproduction cost to 20 – 30%.

• More attention on design.

• More price awareness on raw material.

• Positive discussion about the company.

The Baltics vs Far East

• Shorter distances / transport / design / management.

• More easy to control quality.

• Closer to the raw material suppliers.

• Closer to the main markets.

• With stronger dollor the Baltics will be more competive

• Higher production cost.

• More knowledge in Far East.

• Cost is also going up in China

Future

• There is a lot of pressure on the saleries to day.• We will have 6 – 8 good years in the baltics.

• People going to Ireland, looking for better paid jobs.

• Use the Baltics as a base for further steps into east.

• For us we will be with production both in the Balticas and in far East

Thank you