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Investment Thesis Investment Thesis

• Strong, solid business• Fantastic management• Great portfolio of brands• Short term catalysts & long term growth

opportunities

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AgendaAgenda

• Company Overview• Industry Overview• Risks• Analysis• Q & A

Revenue BreakdownRevenue Breakdown

• Wholesale • Jewelry stores• Department stores

• Retail • Outlets • Luxury retail

• 28 Movado boutiques

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Geographical BreakdownGeographical Breakdown

• Domestic

• International • Growth opportun ities

• China’s luxury market ~ 2bn

Geographical Breakdown IIGeographical Breakdown II

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Movado first incorporated

HistoryHistory

‘93 ‘97‘83’70s‘67

History IIHistory II

‘06 Future‘04‘01‘98

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Business OverviewBusiness Overview

Moderate$100-499

Fashion$55-99

Mass Market< $55

Premium$500-1,499

Luxury$1,500- 9,999

Exclusive$10,000

MovadoMovado

• Founded 1881, Switzerland• Design by Horwitt• Distinctive, minimalist design

• Launch of Series 800 • Increase sell-in at Federated Department Stores• Focus on U.S. and Chinese markets

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EbelEbel

• Founded 1911, Switzerland• Launch of Brasilia Line• Sales

• Doubled over last quarter• 29% over last year

ConcordConcord

• Founded 1908, Switzerland• Sales not as strong as

other brands• Set to undergo revamping

this coming year• Hired new management

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ESQESQ

• Unique positioning as affordable luxury watch

• Project double digit sales increase for ’07

Licensed BrandsLicensed Brands

• Increased 20% over last year

• Coach• One of the most powerful

brands in the market• Fall launch of new male sports

watch, Legacy Sport• Hilfiger

• Growth opportunities in international markets

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Licensed Brands IILicensed Brands II

• Hugo Boss • Launched Spring ’06 • Excellent results

• Juicy Couture• Will launch at the end

of this month• Lacoste

• Arriving January ’07

RetailRetail

• Comprised of:• 27 Boutiques

• 3 set to open this year

• 28 Outlets• Located in:

• Vacation spots• Metropolitan cities• Luxury malls

• Also feature Movado Jewelry and household items

• Same store sales growth of 4.5% last quarter

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PorterPorter’’s 5 Forcess 5 Forces

Threat of New

Entrants

Bargaining Power of

Customers

Threat of Substitutes

Bargaining Power of Suppliers Competitive Rivalry

Within the Industry

Industry OverviewIndustry Overview

• Value• EUR 13.2bn• 21% of overall luxury retail market

• Growth• 2007 ~ 7.9% • 2008 ~ 8.0%

• Trends• “Trading Up”• Sports Watches

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Industry OverviewIndustry Overview

Sport

Mass Market

Fashion

Prestige LuxuryTechnical Jewelry

Rolex

TAG Heuer

EBEL

ESQ

Movado

Concord

Baume &

Mercier

Coach

Swatch

Hugo Boss

Tommy Hilfiger

Omega

Patek Phillippe

Tissot

Tiffany

Cartier

Bulgari

Hermes

Fendi

Dior

Piaget

CK

Dunhill

Montblanc

Richemont

LVMH

Swatch

Movado

Other

RisksRisks

• Domestic exposure• Low consumer confidence• Seasonality• Competitive retail market

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AnalysisAnalysis

• Consumer confidence • Interest rate hikes have slowed• Luxury goods slightly more stable• Next Consumer Confidence Report Sep. 26th

– expected to be at 102 vs. 99• Consumer Spending

• Increased despite high oil prices

• Rising affluence• “Trading up” trend

Analysis IIAnalysis II

• Effect of recession /holiday season• Seasonality/retail

• 50% of revenues are in Q4• Tourist travel flows• Currency risk

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CatalystCatalyst

• Backlog of $43.5 mm • Launch:

• Series 800• Hugo Boss• Juicy at end of this month• Lacoste Jan ’07

• Revamping of Concord• Increased marketing

• Tom Brady• Derek Jeter• Giselle

Financial overviewFinancial overview

• Sales growth• Gross margin increased to 61%

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Q&AQ&A