Pheonix footwear

Phoenix Footwear Group, Inc.

January, 2007January, 2007

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Safe Harbor StatementSafe Harbor StatementThese forward-looking statements include, but are not limited to, These forward-looking statements include, but are not limited to, statements relating to our anticipated financial performance, statements relating to our anticipated financial performance, business prospects, new developments, new merchandising business prospects, new developments, new merchandising strategies and similar matters, and/or statements preceded by, strategies and similar matters, and/or statements preceded by, followed by or that include the words "believes,'' "could,'' "expects,'‘ followed by or that include the words "believes,'' "could,'' "expects,'‘ "anticipates,'' "estimates,'' "intends,'' "plans,'' "projects,'' "seeks,'' "anticipates,'' "estimates,'' "intends,'' "plans,'' "projects,'' "seeks,'' or similar expressions. We have based these forward-looking or similar expressions. We have based these forward-looking statements on our current expectations and projections about statements on our current expectations and projections about future events, based on the information currently available to us. future events, based on the information currently available to us. These forward-looking statements are subject to risks, These forward-looking statements are subject to risks, uncertainties and assumptions, including those described in the uncertainties and assumptions, including those described in the prospectus under the heading "Risk Factors,'' that may affect the prospectus under the heading "Risk Factors,'' that may affect the operations, performance, development and results of our business. operations, performance, development and results of our business. You are cautioned not to place undue reliance on these forward-You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated, or if no looking statements, which speak only as of the date stated, or if no date is stated, as of the date of this prospectus.date is stated, as of the date of this prospectus.

We undertake no obligation to publicly update or revise any We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new forward-looking statements, whether as a result of new information, future events or any other reason, except as we may information, future events or any other reason, except as we may be required to do under applicable law. In light of these risks, be required to do under applicable law. In light of these risks, uncertainties and assumptions, the forward-looking events uncertainties and assumptions, the forward-looking events discussed in this presentation may not occur.discussed in this presentation may not occur.

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Our BrandsOur Brands

Product FocusProduct Focus BrandsBrands

LifestyleLifestyle(apparel and footwear)(apparel and footwear)

Institutional footwearInstitutional footwear(military, public safety and (military, public safety and duty)duty)

Traditional comfort Traditional comfort footwearfootwear

AccessoriesAccessories(belts, hosiery and other)(belts, hosiery and other)

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Company ObjectivesCompany Objectives

• Develop a core of operations centered around Develop a core of operations centered around execution excellence rather than simply product execution excellence rather than simply product categories categories

• Invest in activities and brands in a way that will Invest in activities and brands in a way that will create long term sustained valuecreate long term sustained value

• Make acquisitions that maximize expected value Make acquisitions that maximize expected value even at the expense of lowering near term even at the expense of lowering near term earningsearnings

• Reward leadership for delivering Reward leadership for delivering superiorsuperior long long term resultsterm results

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Profitability and Growth Initiatives for Profitability and Growth Initiatives for 20072007

Growth DriversGrowth Drivers• Tommy Bahama RelaunchTommy Bahama Relaunch• American Red Cross FootwearAmerican Red Cross Footwear• Wal- Mart and K Mart accessories expansionWal- Mart and K Mart accessories expansion

Profitability DriversProfitability Drivers Inventory clearance completed by year endInventory clearance completed by year end China office now operational to support sourcing shiftChina office now operational to support sourcing shift Consolidation of 5 distribution facilities utilizing Third Party Consolidation of 5 distribution facilities utilizing Third Party

solutionssolutions

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Tommy Bahama RelaunchTommy Bahama Relaunch

Well known brand with a parent committed to Well known brand with a parent committed to apparel growth particularly in women'sapparel growth particularly in women's

10 year license negotiated in 8/05 with the 10 year license negotiated in 8/05 with the acquisition of Paradise Shoe for footwear and acquisition of Paradise Shoe for footwear and accessoriesaccessories

Distribution includes company stores (60), better Distribution includes company stores (60), better department doors (Nordstrom's) and specialty department doors (Nordstrom's) and specialty outlets (i.e., Gary’soutlets (i.e., Gary’s))

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ACCOMPLISHED TO DATEACCOMPLISHED TO DATE New organization built – Leadership/ Designers/ New organization built – Leadership/ Designers/

Sales forceSales force

New line designed and New line designed and in productionin production December first shipments / $2.5 mill in orders in first December first shipments / $2.5 mill in orders in first

monthmonth

Old inventory liquidated - third quarter chargeOld inventory liquidated - third quarter charge

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Old Tommy Bahama

Dated styling – Older demographic

Stiffer leathers

Italian manufacture

24 % Gross Margin

New Tommy Bahama

Contemporary relaxed styling

Younger appeal

Supple burnished leathers

Indian manufacture

45%+ Gross Margin

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License entered into in late 2005 is now operational

Product designed and developed for the healthcare market

Sales force is actively engaged in building distribution

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Tightly focused cause marketing

Healthcare market is large and fragmented

Utilizing our proprietary Softwalk footbed

10,000 orders on hand for February delivery

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Accessories sales growth 38% in Q3

Gaining market share at Wal-Mart, Kmart and TSC

Tommy Bahama accessories to add to ’07

Significant additional programs still pending with majors

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Financial Overview

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Trailing Twelve Month Net SalesTrailing Twelve Month Net Sales

0

20

40

60

80

100

120

140

Q3 05 Q4 05 Q1 06 Q2 06 Q3 06

$M 50% CAGR

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Trailing Twelve Months EBITDA and EATTrailing Twelve Months EBITDA and EAT

$5.5

$0.5

$7.9

$1.2

$11.1

$3.0

$13.5

$3.7

$12.7

$3.1

$0

$2

$4

$6

$8

$10

$12

$14

Q3 05 Q4 05 Q1 06 Q2 06 Q3 06

EAT

EBITDA

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Third Quarter EarningsThird Quarter Earnings

In excess of $1.2 mill loss In excess of $1.2 mill loss in Tommy Bahama for Q3in Tommy Bahama for Q3

Accelerated design and Accelerated design and development costsdevelopment costs

Inventory losses of $700k Inventory losses of $700k as old styles cleared to as old styles cleared to make way for new linemake way for new line

ThirdThird Quarter EPSQuarter EPS

Reported

Tommy

Bahama

Pro Forma

Q3 06Q3 05

$.04

$.09

$0.13 $0.12

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Third Quarter GrowthThird Quarter Growth

Organic growth totaled Organic growth totaled 8.8%8.8% for the quarter for the quarter Royal Robbins reported its 11Royal Robbins reported its 11thth consecutive consecutive

quarter of growth at quarter of growth at 28.6%28.6% Our accessories business grew at a rate of Our accessories business grew at a rate of 38.7% 38.7%

for the quarter as we began to deliver on the for the quarter as we began to deliver on the previously announced new business winspreviously announced new business wins

Trotters and Softwalk both grew at modest rates Trotters and Softwalk both grew at modest rates and show strong backlogs entering the spring ’07 and show strong backlogs entering the spring ’07 seasonseason

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Pending DevelopmentsPending Developments

A significant loss will generated in the 4A significant loss will generated in the 4thth quarter quarter as inventory cleanup in Tommy Bahama and Trask as inventory cleanup in Tommy Bahama and Trask is completedis completed

The search committee of the Board is actively The search committee of the Board is actively engaged with Korn Ferry and expects a CEO hire engaged with Korn Ferry and expects a CEO hire to be announced in the current quarterto be announced in the current quarter

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Credit Facility $58 mill Outstanding; $62 Credit Facility $58 mill Outstanding; $62 mill Capacity mill Capacity

Revolving facility Revolving facility $24 mill outstanding$24 mill outstanding $28 mill capacity$28 mill capacity

Term Note 5 year Term Note 5 year $24 million $24 million outstandingoutstanding

Term loan 15 months Term loan 15 months $10 mill outstanding $10 mill outstanding

LIBOR plus 3.5%LIBOR plus 3.5%



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Near Term Outlook 2007 – Near Term Outlook 2007 – 20092009

Earnings Improvements as Tommy and Red Cross Earnings Improvements as Tommy and Red Cross become positive contributorsbecome positive contributors

Underlying brands enjoying solid backlogs and Underlying brands enjoying solid backlogs and positive ’07 outlookspositive ’07 outlooks

Accessories expected to continue market share Accessories expected to continue market share gainsgains

Margin enhancements by way of sourcing and Margin enhancements by way of sourcing and logistics improvements to come online in 2008logistics improvements to come online in 2008

Altama contract renewal uncertain and a risk for ’07 Altama contract renewal uncertain and a risk for ’07 earningsearnings

SOX requirements will increase corporate costs SOX requirements will increase corporate costs considerably in ‘07considerably in ‘07

Pheonix footwear

Business

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