Sem YOOX 10 ENG 04cdn3.yoox.biz/cloud/yooxgroup/uploads/doc/2014/... · A growing number of fashion...

YOOX GROUP

YOOX GROUP

CONSOLIDATED INTERIM FINANCIAL STATEMENTS AT JUNE 30, 2010 | 1

CONSOLIDATED INTERIM FINANCIAL STATEMENTS AT JUNE 30, 2010

YOOX GROUP


YOOX GROUP


Management and control bodies ............................................................................................................................. 5 Director’s interim report ........................................................................................................................................... 7 Condensed consolidated interim financial statements at June 30, 2010 YOOX Group ....................................... 37 Certification of the condensed consolidated interim financial statements pursuant to article 81-ter of CONSOB Regulation no. 11971 of May 14, 1999, as amended........................................................................... 97 Auditors’ review report on the condensed consolidated interim financial statements at June 30, 2010 .............. 98

INDEX

YOOX GROUP


YOOX GROUP


Chairman and Chief Executive Officer Regular Auditors Federico Marchetti Filippo Tonolo – Chairman David Reali Luca Sifo Directors Alternate Auditors Raffaello Napoleone1 Nicola Bottecchia Mark Evans Edmondo Maria Granata Catherine Gérardin1 2 3 Massimo Giaconia1 2 3 Elserino Piol2 Stefano Valerio3

KPMG S.p.A. Rossella Sciolti – Chairwoman Gerardo Diamanti Pietro Tagliati

Francesco Guidotti Pietro Tagliati

1 Member of the Internal Control Committee 2 Member of the Remuneration Committee 3 Member of the Directors’ Appointments Committee

INTERNAL CONTROL MANAGER

DIRECTOR IN CHARGE OF PREPARING CORPORATE

ACCOUNTING DOCUMENTS

SUPERVISORY BODY L.D. 231/01

INDEPENDENT AUDITORS

BOARD OF STATUTORY AUDITORS

BOARD OF DIRECTORS

MANAGEMENT AND CONTROL BODIES

YOOX GROUP


YOOX GROUP


DIRECTOR’S INTERIM REPORT

YOOX GROUP


YOOX GROUP


REFERENCE MARKET....................................................................................................................................11 INTRODUCTION ..............................................................................................................................................11 Multi-brand business line ................................................................................................................................12 Mono-brand business line ...............................................................................................................................13

REVENUES AND PROFITABILITY ..................................................................................................................14 Methodology note............................................................................................................................................14 Accounting policies .........................................................................................................................................14 Reclassified consolidated income statement ..................................................................................................16 Analysis of net revenues and operating profit by business line.......................................................................18 Consolidated net revenues by geographical area ...........................................................................................19

BUSINESS MODEL..........................................................................................................................................20 Commercial planning and procurement ..........................................................................................................20 Marketing ........................................................................................................................................................20 Interface and user experience.........................................................................................................................22 Digital production ............................................................................................................................................22 Retail management .........................................................................................................................................22 Order processing and customer care..............................................................................................................23 Technology ......................................................................................................................................................23

INVESTMENTS ................................................................................................................................................24 FINANCIAL MANAGEMENT ............................................................................................................................25 Summary consolidated statement sheet and financial position.......................................................................25 Debt/Consolidated net financial position .........................................................................................................26

INFORMATION FOR INVESTORS...................................................................................................................26 Performance of YOOX stock in the first half of 2010.......................................................................................27 Performance of YOOX stock and FTSE Italy STAR index in the first half of 2010 ..........................................27 Stock analyst coverage ...................................................................................................................................28 Shareholder structure......................................................................................................................................28 Investor Relations activities.............................................................................................................................28

INFORMATION CONCERNING MEASURES TO PROTECT PRIVACY..........................................................29 PERSONAL DATA PROTECTION CODE.........................................................................................................29 TAX MATTERS .................................................................................................................................................29 LEGAL MATTERS ............................................................................................................................................29 HUMAN RESOURCES.....................................................................................................................................30 Assessment and development of human resources .......................................................................................31 Remuneration police .......................................................................................................................................31

THE ENVIRONMENT.......................................................................................................................................31 CORPORATE GOVERNANCE.........................................................................................................................32 Shareholders’ meeting ....................................................................................................................................32 Share capital and share ownership as of June 30, 2010 ................................................................................32 Board of Directors ...........................................................................................................................................32 Committees .....................................................................................................................................................33 Chairman and Chief Executive Officer ............................................................................................................33 Board of Statutory Auditors .............................................................................................................................33 Director in charge of preparing corporate accounting documents...................................................................34 Independent auditors ......................................................................................................................................34 Internal Audit ...................................................................................................................................................34 Internal Control Manager ................................................................................................................................34 Supervisory Body pursuant to Legislative Decree 231/01...............................................................................34

TRANSACTION AMONG GROUP COMPANIES AND WITH RELATED PARTIES .........................................35 SUBSEQUENT EVENTS..................................................................................................................................35 BUSINESS OUTLOOK.....................................................................................................................................36

INDEX

YOOX GROUP


YOOX GROUP


In 2009, the online retail market continued to appear anti-cyclical, recording strong rates of growth despite the impact of the credit crunch in financial markets on the global economy. Forrester Research estimates that the retail online market, excluding the travel, automobile and prescription medicine sectors, totalled sales of approximately Euro 684 billion in Western Europe in 2009, a 12% increase compared to 2008 and approximately USD 1555 billion in the United States, an increase of 11% over 2008. In 2010 Forrester estimated growth of 13% for the online retail market in Western Europe and of 11% for the United States, which is similar to growth realized in 2009 when compared to 2008. In the context of the retail online market, the YOOX Group operates in the apparel sector (defined as a consolidation of the clothing, footwear, jewellery and watches markets), which according to data from Forrester Research, represented approximately 18% of the online retail market in western Europe and 20% in the United States in 2009, recording rates of growth of 11% and 15% compared to 2008. Forrester forecasts a 2009-2013 CAGR of 12% in Western Europe and 11% in the United States. The reasons for the anti-cyclical behaviour of the retail online market and double-digit growth forecasts are the wider selection of products offered on the web, the search for lower prices and the growing perception of the web as a safe place to make purchases. The trend towards an increase in the number of Internet users and people completing orders online and higher average annual expenditure per user has been confirmed. A growing number of fashion houses, designers and luxury-goods firms have recently created an Internet presence, realizing that this is a viable strategy for expanding their visibility and global reach and for building a direct relationship with their clients. This has led to more companies investing in improvements to the shopping experience, online content and types of “social commerce”, thus sustaining the growth of online sales over the long term.

In the first half of 2010, the Group recorded a significant increase in sales, both for its Multi-brand and Mono-brand business lines. Growth of its Top Line, excluding the cost of Incentive Plans linked to stock options, has also resulted in a substantial increase of the Group’s profitability. In the first six months of the fiscal year its financial resources were partly used to pay for a number of items pertaining to the stock market listing operation and the exercising of stock options, and partly to cover the higher tax burden for 2009 and the advance for 2010. Excluding the impact of these two items, which were only partially presented in 2009, the Company continued to generate steady cash flows from operations and greater use of financial resources for investments in technology. In the first half of 2010 4 Online Stores were opened in the Mono-brand business line (coccinelle.com, giuseppezanotidesign.com, napapijri.com and albertaferretti.com), bringing the number of Online Stores to 20, and a new agreement was entered into between Giorgio Armani S.p.A. and YOOX S.p.A. which extended cooperation in Europe, the United States and Japan until January 31, 2015. The new agreement also provides for the Armani Jeans brand to join emporioarmani.com, and a proxy to YOOX S.p.A. to provide web marketing services to and on behalf of, Giorgio Armani S.p.A. in all the countries where the Online Store is present. The agreement also led to a central warehouse being set up in Italy for all the markets: supplies and deliveries for the North American market were previously managed directly from the United States warehouse. The Group plans to continue its present strategy of steady growth on a global scale with the objective of expanding internationally, both by strengthening the markets in which it operates and by seizing new opportunities to expand its geographical reach, especially in China. By strengthening its local presence in existing markets, it is achieving synergies that result in strong rates of sustained growth especially in North America which is growing quickly compared to early 2009. Furthermore, a

4 Processed data based on figures from Forrester Research – “Forrester Research Online Retail Forecast, 1/10 (Western Europe)” – Vikram Sehgal, February 10,

2010. Western Europe includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Norway, Netherlands, Portugal, United Kingdom, Spain, Sweden, Switzerland.

5 Processed data based on figures from Forrester Research – “Forrester Research Online Retail Forecast, 12/09 (US)” – Vikram Sehgal, February 4, 2010.

INTRODUCTION

REFERENCE MARKET

DIRECTORS’ REPORT

YOOX GROUP


strategic plan has been prepared for the targeted development of the Chinese market where the Group will begin operations by the first half of 2011. The Group focused, among other things, on consolidating and constantly up-dating its technological platforms during the early months of 2010, by defining a roadmap for long-term development, completing a substantial revision of its structure, and adopting a new outsourcing strategy. This continuous renewal produced several important technical solutions in the first half of 2010, including YOOX APIs (Application Programming Interfaces), which made it possible, for example, to develop a proprietary application (YOOX.COM for iPad) in parallel with the US launch of thw APPLE iPAD in April 2010, which confirms YOOX Group’s role as “first mover” in the use of “mobile commerce” techniques. Also thanks to the new set of APIs, a version of the yoox.com website for the “Keitai” platform, targeted at the Japanese market, was launched together with an innovative Facebook application which was released for the Group’s tenth anniversary. On June 23, 2010, for the first anniversary of the D&G brand online store dolcegabbana.com, a new version of the Online Store was released that optimizes all the functions involved in searches, including with iPads. A series of steps were also taken that concentrated on infrastructural and connectivity components in order to improve performance as perceived by users, and on operative management, with noticeable improvements to response times for pages on all the Group’s websites, prevalently in distant markets. With the goal of constantly improving user experience on the Group’s online stores a function called “fast checkout” was released that redesigns the purchase procedure completely by allowing the user to complete his/her order quickly and easily, by saving and then recalling delivery, invoicing and payment data. By introducing this function on its website yoox.com ensured, from the time it was first released, a significant improvement in costumers experience, and this function will be extended to the Group’s other online stores. Furthermore, with the aim of maximising the Group’s business potential, a series of Customer Relationship Management (CRM) and Campaign Management solutions were released to enable total exploitation of potential interaction with clients. One of these projects is MEA Campaign Management, a sophisticated system developed by the Company that integrates data from the Business Intelligence database, such as, for example, the orders history, behaviour on the site, etc. by sending a newsletter, in order to automatize direct-marketing procedures on the basis of client profiles. The new 9.0 release of yoox.com was launched at the beginning of August 2010, which incorporated CRM functions such as the Recommendation Engine (i.e. the possibility of suggesting personalised product selections based on the navigation behaviour of individual users) and the Behavioural Targeting system (i.e. the possibility of showing ad hoc communications according to navigators belonging to a specific cluster). A significant number of new e-commerce functions were also developed in order to improve the presentation of the product (such as, for example, the full screen zoom), the perception of performance through a functional and technical revision of the navigation and search system and, lastly, the integration of the video contents to give the user an experience where they feel more involved. It should also be noted that this collection of new functions will then be applied gradually and adapted for the other Group online stores. Multi-brand business line The Group’s Multi-brand business takes place in 2 Online Stores owned by the Company: (i) yoox.com, which currently constitutes the main portion of revenues from the Multi-brand business line; (ii) thecorner.com, which opened in the first half of 2008. The Group based its growth on yoox.com, and subsequently developed the Mono-brand business line and thecorner.com business lines using the technological, operational and business competencies acquired over the years. yoox.com has been an operational Online Store since June 2000 which, at June 30, 2010, sells and distributes a vast assortment of fashion and designer goods in 67 countries. Most of the products offered on yoox.com consist of well-known brands of clothing, footwear and accessories from the same season of the previous year at reduced prices. To complete its select offering, yoox.com also offers cachet collections (manufactured for yoox.com only) from important designers, as well as vintage collectibles, trendy special-edition designer garments, and an original range of designer objects. thecorner.com is an Online Store launched in February 2008 to sell the current season’s collections of well-established, niche and/or handcrafted brands which have limited distribution and many of which are offered online for the first time. Products sold on thecorner.com have prices comparable to the same garments and accessories being sold through traditional channels.

YOOX GROUP


At its start, thecorner.com offered men’s clothing only; in September 2009 it launched a women’s collection. thecorner.com appears as a virtual space with mini-stores selling each brand (so-called “shop-in-shops”), which aim to re-create the style, ambiance and feel of the brands themselves. In particular, clients can choose clothes, footwear and accessories thanks to exclusive multimedia content, pictures from advertising campaigns and fashion shows. In the first half of 2010, the Multi-brand business line recorded a monthly average of about 5.0 million unique visitors6. Mono-brand business line In 2006, the Group started the Mono-brand business line, offering planning, realization and management exclusively for mono-brand Online Stores of some major fashion brands at a global level, based on close cooperation. Products available in the online stores are sold and invoiced directly by YOOX to the end customer. The Group offers its services as the Strategic Partner of important companies in the field of fashion which have internationally-known brands. On the basis of its many years of experience in managing yoox.com, the Group is able to manage the entire e-commerce procedure for those companies. The sentence “Powered by YOOX Group” appears on all Online Stores and is recognized as a guarantee of the quality of the service provided by YOOX. In the first half of 2010, the Mono-brand business line recorded a monthly average of about 3.1 million unique visitors. At June 30, 2010 there were 20 operating Online Stores, 3 of them set up in 2006/2007, 7 of them in 2008, 6 of them in 2009 and 4 of them in the first six months of 2010. Specifically:

- marni.com, an Online Store of Marni brand which opened in September 2006 and now operates mainly in Europe, the United States, and Japan;

- emporioarmani.com, the Online Store of Emporio Armani brand, and with the amendment to the agreement in coming months, will include the Armani Jeans brand which has been selling in the United States since August 2007 and which extended its operations to the main European markets in June 2008 and to Japan in July 2009;

- diesel.com, the Online Store of Diesel and Diesel Black Gold brand, operational mainly in Europe and the United States since November 2007;

- cpcompany.com, the Online Store of brand CP Company, brand since February 2008 prevalently active in the main European markets, the United States and Japan;

- stoneisland.com, the Online Store of brand Stone Island, brand active since March 2008 prevalently in the main European markets, the United States and Japan;

- valentino.com, the Online Store of Valentino and the Red Valentino brands, operational since in April 2008 in the United States and as of March 2009 in the main European markets and Japan;

- misssixty.com, the Online Store of Miss Sixty brand, active since September 2008 mainly in Europe and the United States;

- costumenational.com, the Online Store of brand Costume National, brand since September 2008 mainly in Europe, the United States and Japan;

- energie.it, the Online Store of Energie brand, active since October 2008 mainly in Europe and the United States;

- emiliopucci.com, the Online Store of Emilio Pucci brand, active since November 2008 prevalently in the main European markets, the United States and Japan;

- moschino.com, the Online Store of Moschino, Love Moschino and MoschinoCheapAndChic brands, active since February 2009 mainly in Europe and the United States;

6 Unique monthly visitors is defined as a visitors who have opened at least one browser session to visit the online store during the month. The figure shown is the

average for the period concerned of monthly unique visitors.

YOOX GROUP


- bally.com, the Online Store of Bally brand, active since February 2009 mainly in Europe and the United States;

- dolcegabbana.com, the Online Store of D&G brand, active since June 2009 mainly in Europe, the United States and Japan;

- dsquared2.com, the Online Store of brand Dsquared2, brand active since September 2009 mainly in Europe, the United States and Japan;

- jilsander.com, the Online Store of Jil Sander brand, active since September 2009 mainly in Europe, the United States and Japan;

- robertocavalli.com, the Online Store of Roberto Cavalli brand, active since November 2009 mainly in Europe, the United States and Japan;

- coccinelle.com, the Online Store of Coccinelle brand, active since February 2010 mainly in Europe, the United States and Japan;

- giuseppezanottidesign.com, the Online Store of Giuseppe Zanotti brand, active since February 2010 mainly in Europe, the United States and Japan;

- napapijri.com, the Online Store of Napapijiri brand, active since March 2010 mainly in Europe and the United States;

- albertaferretti.com, the Online Store of Alberta Ferretti and Philosophy by Alberta Ferretti brand, active since March 2010 mainly in Europe, the United States and Japan.

Negotiations are also underway with other well-known fashion brands which plan to offer their collections on the internet, some of which will be finalized and operating by 2010. The Group also offers its Partners consultancy and services and management of web marketing investments, both during the launch of new Online Stores and for their on-going management.

Methodology note This section contains information about the consolidated revenues and profitability of the YOOX Group at June 30, 2010. Unless otherwise specified, all amounts are expressed in thousands of Euro. Comparisons in the rest of this report and in the condensed consolidated interim financial statements are in respect of the corresponding period of the previous fiscal year and/or data at December 31, 2009. For reasons of clarity, it should be pointed out that the percentage variances and the variations in the different postings shown have been calculated on precise values. It should also be stated that any differences retraceable in some of the tables are due to the rounding off of the amounts expressed in thousands of Euro. The parent company YOOX S.p.A. is referred to with its full name or simply as the Company; the Group reporting directly to it appears as YOOX Group or simply as the Group; when notes refer to subsidiaries, full company names are used. All YOOX S.p.A. subsidiaries operate in the Group’s sector of business or perform activities that are consistent with those of the Group. YOOX S.p.A. manages its subsidiaries (shown in the condensed consolidated interim financial statements at June 30, 2010) based on the location of their operations. Therefore, for more accurate information on geographical areas, please refer to the information by business sector and, in general, to information provided in the condensed consolidated interim financial statements for comments about the main events relating to subsidiaries. Accounting policies The accounting standards, the consolidation standards and valuation criteria used in preparing the condensed consolidated interim financial statements at June 30, 2010 for the YOOX Group are consistent with the standards

REVENUES AND PROFITABILITY

YOOX GROUP


used to draw up the consolidated financial statements at December 31, 2009; they are posted on the website www.yooxgroup.com under the heading “Investor Relations” section. The interim Financial Report at June 30, 2010, compiled in accordance with article 154-ter, paragraph 2, of the Consolidated Finance Law, is prepared in compliance with international accounting principles (International Financial Reporting Standards – IFRS) and, in particular, IAS 34 – Interim Financial Reporting and it includes this Interim director’s report, the condensed consolidated interim financial statements and the certificate laid down by article 154-bis, paragraph 5, of the Consolidated Finance Law. The profit and loss statements for the Group, presented in the following pages of the current Directors Interim Report for the half-year period, have been reclassified in a way deemed by management to be useful for reporting interim indicators of profitability such as gross profit, EBITDA before corporate costs, EBITDA, EBITDA without incentive plans and operating profit. Some of the aforementioned interim indicators of profitability are not recognized as an accounting measure under IFRS Accounting Standards endorsed by the European Union; their calculation may not be standard. Said indicators are used by Group management to monitor and assess the Group’s performance. Group management believes these indicators are an important parameter for measuring performance in that they are not affected by the various criteria used to calculate taxable amounts, the amount and characteristics of capital invested and the related amortization and depreciation methods. The criterion used by the Group to calculate these indicators might not be consistent with that adopted by other groups or companies and, accordingly, the resulting figures might not be comparable.

YOOX GROUP


Reclassified consolidated income statement Reclassified consolidated income statement for the second quarter 2010:

Thousands Euro Quarter II 2010 Quarter II 2009

Changes Consolidated net revenues 46,269 33,237 13,032 39.2%Cost of good sold (27,853) (20,257) (7,596) 37.5%Gross Profit7 18,416 12,980 5,436 41.9%

% of consolidated net revenues 39.8% 39.1% Fulfillment cost (5,045) (3,721) (1,324) 35.6%Sales and marketing costs (5,845) (3,932) (1,914) 48.7%EBITDA Pre Corporate Costs8 7,525 5,327 2,199 41.3%

% of consolidated net revenues 16.3% 16.0% General expenses (4,648) (2,833) (1,815) 64.0%Other income and expenses 50 (377) 427 -113.3%EBITDA9 2,928 2,117 811 38.3%

% of consolidated net revenues 6.3% 6.4% Depreciation and amortization (834) (458) (376) 82.6%Non-recurring expenses - - - -Operating profit 2,093 1,658 435 26.1%

% of consolidated net revenues 4.5% 5.0% Financial income 428 194 234 >100%Financial charges (321) (528) 207 -39.2%Profit before Tax 2,200 1,324 876 66.2%

% of consolidated net revenues 4.8% 4.0% Tax (839) (190) (649) >100%Consolidated profit for the period 1,362 1,135 227 20.0%

% of consolidated net revenues 2.9% 3.4%

EBITDA excluding Incentive Plans10 3,966 2,238 1,728 77.2%

% of consolidated net cost revenues 8.6% 6.7% The second quarter of 2010 closed with an increase in consolidated net revenues, net of sales returns and customer discounts, of 39.2% compared to the corresponding period of the previous year. Profitability, measured in terms of EBITDA (earnings before interest, taxes, depreciation and amortization) was Euro 2,928 thousand, recording growth of 38.3% compared to the second quarter in 2009. The increase in profitability was invalidated by a higher incidence of figurative expenses related to the incentive plans in 2010: excluding this effect, the EBITDA excluding the incentive plans was Euro 3,966 thousand, that is, profitability of 8.6% of consolidated net revenues compared to 6.7% in the second quarter of 2009, an increase of 77.2%. The consolidated profit in the second quarter of 2010 is Euro 1,362 thousand and subject to a different tax burden. For further details, please refer to the comments in the notes to the condensed consolidated interim financial statements at June 30, 2010.

7 Gross profit is profit before fulfillment costs, commercial expenses, general expenses, other operating income and expenses, depreciation and amortization,

non-recurring expenses, financial income and expenses and income taxes. Since gross profit is not recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union, its calculation might not be standard, and the measurement criterion adopted by the Group might not be consistent with that adopted by other groups, and accordingly, the resulting figures may not be comparable.

8 EBITDA Pre Corporate Costs is defined as profit before general expenses, other operating income and expenses, depreciation and amortization, non-recurring expenses, financial income and expenses and income taxes. Since EBITDA Pre Corporate Costs is not recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union, its calculation might not be standard, and the measurement criterion adopted by the Group might not be consistent with that used by other groups, and accordingly, the resulting figures may not be comparable. EBITDA Pre corporate costs corresponds to the sector operating result shown in the explanatory notes attached to the condensed interim financial statements.

9 EBITDA is profit before depreciation and amortization, non-recurring expenses, financial income and expenses and income taxes. Since EBITDA is not recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union, its calculation might not be standard. Group management uses EBITDA to monitor and measure the Group’s performance. Management believes that EBITDA is an important measure of operating performance in that it is not affected by the various criteria used to calculate taxes, the amount and characteristics of invested capital and the related amortization and depreciation methods. The criterion used by the Group to calculate EBITDA might not be consistent with that adopted by other groups, and accordingly, the resulting figure may not be comparable with those calculated by such groups.

10 The EBITDA, excluding the Incentive Plans costs is defined as the EBITDA net of the costs for the stock option plans as detailed in the condensed consolidated interim financial statements.

YOOX GROUP


Reclassified consolidated income statement for the first half 2010:

Thousand Euro Period at

June 30, 2010Period at

June 30, 2009

Change Consolidated net revenues 96,554 68,305 28,249 41.4%Cost of goods sold (59,445) (42,635) (16,811) 39.4%Gross Profit11 37,108 25,670 11,438 44.6%

% of consolidated net revenues 38.4% 37.6% Fulfillment costs (10,003) (7,404) (2,598) 35.1%Sales and marketing costs (11,409) (7,830) (3,579) 45.7%EBITDA Pre Corporate Costs12 15,696 10,436 5,260 50.4%

% of consolidated net revenues 16.3% 15.3% General expenses (8,623) (5,628) (2,994) 53.2%Other income and expenses (240) (624) 385 -61.6%EBITDA13 6,834 4,184 2,650 63.3%

% of consolidated net revenues 7.1% 6.1% Depreciation and amortization (1,526) (891) (635) 71.3%Non-recurring expenses - - - -Operating profit 5,308 3,293 2,015 61.2%

% of consolidated net revenues 5.5% 4.8% Financial income 843 337 506 >100%Financial expenses (539) (1,053) 515 -48.8%Profit before tax 5,612 2,577 3,035 >100%

% of consolidated net revenues 5.8% 3.8% Tax (2,273) (1,015) (1,258) >100%Consolidated profit for the period 3,339 1,562 1,777 >100%

% of consolidated net revenues 3.5% 2.3%

EBITDA excluding Incentive Plans14 8,153 4,456 3,698 83.0%

% of consolidated net sales revenues 8.4% 6.5% The first half of 2010 has closed with an increase in the consolidated net revenues, net of returns and customer discounts, of 41.4% compared to the same period of previus year. Sales were marginally affected by the impact of foreign exchange fluctuations with respect to sales in US dollars, Japanese yen and English pounds. In fact, if average exchange rates for the first half of 2009 were applied to consolidated net revenues for 2010, the Group’s revenues growth would be 40.6%. Given an increase in sales of 41.4%, there was an increase in profitability measured, in terms of the EBITDA, at 63.3%. The EBITDA in the first half of 2010 totalled Euro 6,834 thousand equal to a 7.1% profitability on the consolidated net revenues compared to 6.1% in the first half of 2009. The Group’s profitability depends on the increased incidence of figurative expenses related to the incentive plans. Net of this impact, the EBITDA excluding the incentive plans totalled Euro 8,153 thousand, equal to an 8.4% profitability on consolidated net revenues compared to 6.5% in the first half of 2009, with 83.0% growth. The increase in profitability was mainly due to the increased volumes, supported by a higher AOV (which also made it possible to better absorb fixed costs), efficiency policies aimed at optimising existing processes and the renegotiation of several supplier contracts that led to a reduction in unit costs despite the higher costs resulting from its status as a listed company. The consolidated profit is Euro 3,339 thousand with a 3.5% profitability on consolidated net revenues compared to 2.3% in the first half of 2009, despite the higher tax burden. It is worth mentioning the results generated by the

11 Gross profit is profit before fulfillment costs, commercial expenses, general expenses, other operating income and expenses, depreciation and amortization,

non-recurring expenses, financial income and expenses and income taxes. Since gross profit is not recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union, its calculation might not be standard, and the measurement criterion adopted by the Group might not be consistent with that adopted by other groups, and accordingly, the resulting figures may not be comparable.

12 EBITDA Pre Corporate Costs is defined as profit before general expenses, other operating income and expenses, depreciation and amortization, non-recurring expenses, financial income and expenses and income taxes. Since EBITDA Pre Corporate Costs is not recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union, its calculation might not be standard, and the measurement criterion adopted by the Group might not be consistent with that used by other groups, and accordingly, the resulting figures may not be comparable. EBITDA Pre corporate costs corresponds to the sector operating result shown in the explanatory notes attached to the condensed interim financial statements.

13 EBITDA is profit before depreciation and amortization, non-recurring expenses, financial income and expenses and income taxes. Since EBITDA is not recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union, its calculation might not be standard. Group management uses EBITDA to monitor and measure the Group’s performance. Management believes that EBITDA is an important measure of operating performance in that it is not affected by the various criteria used to calculate taxes, the amount and characteristics of invested capital and the related amortization and depreciation methods. The criterion used by the Group to calculate EBITDA might not be consistent with that adopted by other groups, and accordingly, the resulting figure may not be comparable with those calculated by such groups.

14 The EBITDA, excluding the Incentive Plans cost is defined as the EBITDA net of the costs for the stock option plans as detailed in the condensed consolidated interim financial statements.

YOOX GROUP


Group’s financial management, which positively impact the profit (loss) for the period thanks, primarily, to the impact of the foreign exchange trend in the first six months of the fiscal year. The table below provides several key indicators on the Group’s operations for the first half of 2009 and 2010.

June 30, 2010 June 30, 2009 Number of unique visitors per month 15 (millions) 8.1 6.0 Number of orders (’000) 717 536 AOV16 (Euro) 174 164 Number of Active Customers17 (‘000) 532 399 In the first half of 2010, the Group recorded an average of monthly unique visitors of 8.1 million, up 34.0% compared to the 6.0 million in the first half of 2009. In March 2009, new web marketing campaigns were launched on the multi-brand online store through affiliations that generated a significant and temporary increase in traffic; these campaigns were not repeated in the first few months of 2010. The number of orders went from 536 thousand in the first half of 2009 to 717 thousand in the same period of 2010, a 33.7% growth. There was significant growth in the average order value, which totaled Euro 174 (excluding VAT) compared to 164 for the same period in the previous fiscal year. The number of active customers totalled 532 thousand, rising by 33.2% compared to 399 thousand in the first half of 2009. Analysis of net revenues and operating profit by business line Below is key operating information by business line with a breakdown of the Group’s net revenues and operating profit by business line for the first half of 2009 and 2010. Since the management reporting system used by management to assess corporate performance does not allocate certain accounting aggregates to business lines (depreciation and amortization, non-monetary revenues and expenses, general expenses, other non-recurring income and expenses, financial income and expenses and taxes), these items remain the purview of the Corporate area since they are not related to the specific operating activities of the business lines. Thus, the business line’s operating profit coincides with EBITDA Pre Corporate Costs in terms of the entries included and previously reported in this total. For additional details on operating information by business line as of June 30, 2010 with a reconciliation of entries with the Group’s income statement, see the condensed consolidated interim financial statements at June 30, 2010. Operating information by business line as of June 30, 2010 is as follows: Multi-brand Mono-brand Group total Thousand Euro June 30, 2010 June 30, 2009 June 30, 2010 June 30, 2009 June 30, 2010 June 30, 2009

Consolidated net segment revenues 73,831 56,982 22,723 11,323 96,554 68,305 % of net Group revenues 76.5% 83.4% 23.5% 16.6% 100.0% 100.0%

% change 29.6% 100.7% 41.4% Operating profit for segment 11,857 9,264 3,839 1,172 15,696 10,436 % consolidate net segment revenues 16.1% 16.3% 16.9% 10.4% 16.3% 15.3%

% change 28.0% 227.4% 50.4% Multi-brand business line The Group’s multi-brand operations, which break down into two Online Stores owned by the Company yoox.com and thecorner.com, showed sales increases of 29.6% in the first half of 2010 compared to the same period in 2009. Multi-brand sales are still primarily generated by yoox.com but thecorner.com’s contribution continues to grow. In both Online Stores, sales in the first months of the year were primarily related to Autumn/Winter 2009-2010 when there were many sales campaigns. Instead, in the last part of the first quarter and the second quarter, Spring/Summer 2010 was the predominant season. The new Autumn/Winter 2010-2011 collection preview on 15 Source: HBX 01.01.09-19/03/09; SiteCatalyst from 19/03/09 for yoox.com and Google Analytics for thecorner.com and Online Store. 16 Average Order Value or AOV, excluding VAT indicates the average value of each purchase order. 17 Active Customer is defined as a customer who placed at least one order during the 12 preceding months.

YOOX GROUP


yoox.com had a significant impact on the last part of the second quarter. The preview was launched in May to a select group of customers and then extended to all customers in June 2010. The increased sales from the Multi-Brand business line is reflected in the increased operating profit for segment (28.0%) with the 16.1% margin essentially in line with the 2009 numbers (even the operating profit for segment, as shown by the EBITDA, depends on the increased impact of the figurative expenses related to the Incentive Plans in 2010). Mono-brand business line As of June 30, 2010, there were 20 an Online Stores for the Mono-brand business line compared to the 13 in the first half of 2009. The growing contribution of the active Online Stores and the increased importance of the new Online Stores opened led to the 100.7% growth of the Mono-brand business line. The performance of this business line was good due to the boost provided by promotions for Autumn/Winter 2009-2010 (end of the season sales) in the first few months of the year, following up, in part, on the strong sales for Spring/Summer 2010, thanks to a significant increase in traffic volume. Mono-brand operating profit also rose more than proportionally to sales, with the margin rising from 10.4% in the first half 2009 to 16.9% since higher volumes make it possible to better absorb the costs of the structure created, mainly in the previous year, to support the business line’s development, the various mix of Online Stores and revenues from the set up and maintenance of Online Stores and web marketing and web design services. Consolidated net revenues by geographical area Below is a breakdown of the Group’s consolidated net revenues by geographical area for the first half of 2010. Thousand Euro June 30, 2010 June 30, 2009 Change Italy 23,278 24.1% 18,851 27.6% 4,426 23.5%

Europe (excluding Italy) 46,471 48.1% 33,993 49.8% 12,478 36.7%North America 18,918 19.6% 10,180 14.9% 8,738 85.8%Japan 6,095 6.3% 4,035 5.9% 2,060 51.0%Other countries 658 0.7% 364 0.5% 294 80.7%Not country-related 1,134 1.2% 882 1.3% 252 28.6%

Total YOOX Group 96,554 100.0% 68,305 100.0% 28,248 41.4%

In the first six months of 2010, the Top line grew 41.4% compared to the first half of 2009: the balanced growth of sales in various markets was also confirmed in those 6 months, with international development gaining continued importance. The strengthening of local structures in existing markets is creating synergies that are reflected in the growth rates achieved, especially in the North American market. As mentioned previously, the increased sales were only partially impacted by the weakening of the Euro compared to other currencies: by applying the average exchange rates of the previous fiscal year, growth would be around 40.6%. The European market represents 72.2% of the Group’s sales in the first half of 2010 with Euro 69,749 thousand, a 32.0% increase compared to the first half of 2009. The top market for sales is the domestic market, Italy, with sales of Euro 23,278 thousand, up 23.5% compared to the previous year. The rest of Europe is up 36.7%. The main countries that contribute to the Group’s sales in Europe in the first half of 2010, besides Italy, are France, Germany and the UK, which are all up compared to the same period in 2009. Expansion within other European countries continues with excellent growth. North America posted strong figures compared to the first half of 2009, up 85.8% (by applying the average exchange rate for the previous year, growth would be at 85.0%). Today, this market, as shown at the end of 2009, is growing for both the Multi-Brand and Mono-Brand sectors. The Japanese market posted strong figures up 51.0% compared to the first half of 2009 with a favourable exchange rate (by applying the average exchange rate of the first half of 2009, growth would be at 44.0%). Growth in other countries continues, despite the fact that they were still not targeted by any specific marketing or commercial initiatives. However, initiatives are being evaluated by the Group.

YOOX GROUP


The item “Not country related” includes payments for setting up and maintaining the Online Stores, revenues generated from the sale of media partnership projects for the Multi-brand business line, and revenues from web marketing and web design services in the Mono-brand business line, which are offered by Yagency.

Below is a brief description of the main operations in the first half of 2010 broken down by phases of the business model (value chain).

Commercial planning and procurement In the first half of 2010, the focus of the procurements was the Autumn/Winter 2010-2011 campaign, with a preview on yoox.com starting in June 2010. The geographic expansion and growing independence of the American branch was confirmed with this purchasing campaign through the procurement of the retail channel for the European markets. As already shown in 2009, the assortment from the design area, which offers almost twice as many products as the same period from the last year, continued to grow during the first half of 2010. Due in part to the introduction of the women’s wear line, thecorner.com also enhanced its range with additional prestigious brands from September 2009. It further diversified procurement and reduced inventory risk through several supply arrangements that involved no risk for the Company (consignment agreements). In the second quarter, particularly in the month of June, purchasing campaigns began in Spring/Summer 2011, particularly women’s pre-collections and men’s collections. Again in this case, agreements were reached with prestigious international brands, particularly for the men’s collection. In the Mono-brand business line, the Company continued to support individual Strategic Partners with the aim of determining the optimal range by product and price categories; in the first few months, the Autumn/Winter 2010-2011 season was completed and the assortment is being selected for the Spring/Summer 2011 season. Further growth in the business line, through the performance of existing Online Stores and new ones launched in the first half of 2010, which was marked by the contracts in force, had positive repercussions on the management of working capital and for yoox.com represents a further preferential procurement channel for unsold products at the end of the season, since individual Strategic Partners have the option to offer their unsold products to YOOX for sale on yoox.com. Marketing In the first half of 2010, the marketing area was involved in Search Engine Marketing (SEM) activities (acquisition of sponsored links on the main search engines), the purchase of online advertising space, the negotiation and implementation of new marketing agreements (especially on fashion sites and online newspapers) and the development of new partnerships in general. These activities were carried out primarily for the Group’s Multi-brand stores (yoox.com and thecorner.com), but with an increasing commitment to the agency activities carried out by the Group for mono-brand stores. In the management of the web marketing investment on behalf of Strategic Partners of the Mono-brand business line, the Group is offering support and consulting services to Online Stores, especially in the management of search engine marketing (SEM), by leveraging skills developed

Human Resources - Press Office - Administration, Finance and Control - Legal Office - Internal Audit - General Services - Investor Relations

BUSINESS MODEL

Interface and user

experience

Digital

production

Retail

management

Order processing

and customer

care

Commercial planning and procurement

Marketing

Technology

YOOX GROUP


for the Multi-brand business line and existing structures but also in the field of affiliation marketing and Display Advertising campaigns. In 2010, the Group designed and promoted web campaigns that allowed the Multi-brand business line to reach about 40 thousand sites in 50 countries. The marketing team based at headquarters took on an operational and coordinating role for outside offices in Hoboken, which were moved to New York in March 2010 (for the US and Canadian markets), Tokyo (for Japan) and the local offices in Paris and Madrid, within which employees were assigned to marketing activities. At the same time, the structure increased the number of fee-based media partnership projects on yoox.com. These projects consist in creating customized product areas per fashion, design, beauty and lifestyle brand on yoox.com through YOOX Group communication channels (yoox.com, thenewyooxer.com, newsletter, magazine partner shopping sections and social channels). The Press Office followed the promotion of special projects on yoox.com and thecorner.com and also participated in the communication of the Online Store launched in 2010 in close collaboration with the Press Offices of the respective brands. With regard to yoox.com, the initiatives that attracted most press attention in the first half of 2010 were the following:

- “Ten years ten looks for yoox.com 2000 ten,” the limited edition collection designed exclusively for yoox.com by Spanish designer, David Delfin: an initiative focused on creating visibility in the Spanish market launched in February;

- in collaboration with “Rolling Stone” Italy, the online CLUBLAND vintage project from the end of March, a unique vintage piece selection inspired by the coolest clubs of the 70s, 80s and 90s and exclusive contents;

- exclusively for the YOOXYGEN eco-initiative, a new collection for the ever green series: the limited edition t-shirt collection for men and women designed by US model Summer Rayne Oakes and produced by EDUN LIVE;

- on April 3, along with the launch of the iPad in the US, yoox.com launched its “YOOX.COM for iPad” application, which enables customers to experience online shopping with one of the most innovative web browsing devices on the market;

- during the Milan Furniture Show, yoox.com announced its partnership with Established & Sons. A selection from its collection was presented through an interactive 3D performance created by yoox.com and made available directly online;

- on April 22, yoox.com presented several new YOOXYGEN initiatives including the YOOXYGEN by CIGNO Bike and SAVE THE SEA by KATHARINE HAMNETT BEACH for YOOXYGEN, a limited edition capsule collection called SAVE THE SEA, designed by Katharine Hamnett and available exclusively on yoox.com;

- among the initiatives tied to its 10th birthday, yoox.com has announced its partnership with Anna Dello Russo, who designed 10 T-SHIRTS for the occasion, which sold out in just a few hours.

As part of the marketing plan for the 10th birthday of yoox.com, in the month of June, the Group’s first Facebook application was issued, designed and managed internally. The YOOX TOP 10 application, during the 10-day game, allowed users on Facebook to create a personal style and have their friends vote for it. The application allows customers to select all the products on yoox.com, mixing and matching to express their own style and creativity. The products can be personalized by adding details, accessories, variants, backgrounds and colours and customers can share their style with other users. The 10 user styles that receive the most votes will be included in the i-D Magazine, which will pick one of the styles to create a look to be published in a 6-page editorial in i-D Magazine. The magazine will also interview the person who creates the top voted style, which will be published in the September issue of i-D Magazine. The press office continued its promotional activities for thecorner.com, with the launch of new collaborative efforts and special projects including:

- in January 2010, thecorner.com worked with PITTI IMMAGINE as a media partner, presenting exclusive online content related to the main events of the show, video and interviews;

- from February to March 2010, promotions focused on the opening of new corners: Antonio Marras, Giuliano Fujiwara, Kitsunè, Ohne Titel and, in the month of April 2010, Missoni and Phillip Lim;

- starting on March 10, 2010, Neil Barrett created a T-shirt for thecorner.com as a free gift for customers;

YOOX GROUP


- in May 2010, thecorner.com presented the “Styling Around the World” project online in partnership with the English magazine i-D Magazine, which held an exclusive shoot with a selection of garments from thecorner.com;

- in June 2010, thecorner.com worked with PITTI IMMAGINE as a web media partner, presenting exclusive online content related to the main events of the show, video and interviews.

The editorial cover for the YOOX Group at the end of June 2010 included important sector magazines like The Times (UK), ELLE (Italy), WWD (USA), Instyle (Spain) and Marie Claire (Italy). Interface and user experience The phase related to the interface and user experience, which is managed by Interactive Services, is responsible for developing and managing, for the Group’s Online Stores, the elements that have an impact on customers’ digital experience, meaning the design and optimisation of interfaces and the logical structure of Online Stores, their development and layout. During the first half of 2010, the main activities were issuing the 4 new mono-brand Online Stores and, for one of them, issuing a new corporate site and the release of platforms and new features planned for the second quarter for both the mono-brand and multi-brand. For example, in order to constantly improve the experience of users using the Group’s sites, a “fast checkout” function was added to completely redesign the purchase experience. This allows users to place their orders simply and rapidly by saving and recording their shipping, billing and payment information. All other conditions being the same, the conversion rate improved when this function was introduced on yoox.com and this function will be expanded to the other Group sites. In the first half of 2010, the international process of creative activities was accelerated through the creation of an Interactive Design team that handles the design and development of the Group’s graphic and video materials. Digital production The cataloguing of clothing for the 2010 Spring/Summer season was completed during the first six months of 2010 and work was started on the 2010-2011 Autumn/Winter season which, as far as the business model is concerned, concentrates supply in the first half of the year, especially for the Multi-brand business. Production capacity has been increased with the fitting out of a further 4 photographic studios at the Bologna Logistics Centre and the definition of technical specifications and creation of two new automatic photographic machines, one for 360° photographs and one for photographs on mannequins. Retail management Information on the user base was gathered and processed (by business line, type of Online Store, geographic market, etc.) in order to extract key information on customer preferences to determine what measures would improve the propensity to purchase. Retail management of the Multi-brand business line provided for the definition and management of the business plan, sales prices, visual merchandising and customer relationship management (CRM), by mailing approximately 59 million newsletters translated into seven different languages to subscribed users. The opening months of 2010 featured the 2009-2010 Autumn/Winter collection sales campaign, gradually moving towards the 2010 Spring/Summer campaign and, for yoox.com, the 2010-2011 Autumn/Winter preview launched to selected customers in May 2010 and extended to all customers in June. The collection was introduced to final customers following the season’s trends and new features that are regularly introduced into the business opportunity of yoox.com and thecorner.com, respectively. In close collaboration with Strategic Partners, Mono-brand retail management established the business plan at the beginning of the season for individual Online Stores by scheduling product promotions, and determining the timing for applying promotional policies and discounts by product and market. Also in collaboration with Strategic Partners, it determined the content of direct marketing campaigns and newsletters.

YOOX GROUP


Order processing and customer care In the first half of 2010, approximately 717 thousand customer orders were placed, an increase of about 33.7% over the same period of the previous year, and equal to one order processed every 22 seconds18. The statistics for all worldwide deliveries in the first six months of 2010 show that over 99% of orders were received in the specified delivery time, based on customers’ choices. The development of the basic process and the new interface for monitoring online fraud were completed, not limited simply to credit card transactions, but extended to other payment systems and potentially fraudulent behaviour. The tools currently available are definitely the most up-to-date for combating online fraud in the e-fashion industry. The development of algorithms for determining the degree of risk will be assessed in coming months plus the introduction of new tools that give increasingly precise information about orders made on our websites. The incidence of transport costs is constantly decreasing, although the increase in the cost of raw materials, especially oil, compared with the same period of fiscal year 2009, should be stressed. Customer service continues to pursue the aim of maximizing the efficiency of the processes that have an impact on final customers, through the automation and reduction of manual activities and interaction between customers and our information systems (self-service mode). A development plan has also been devised, that will start to be applied in the coming months, involving the communication channels between customers and customer service, aimed at improving effectiveness and the interaction between customers and the company, with anticipated benefits both in terms of improvement of the processes and in terms of containing costs. Technology Technology underwent a major restructuring in the opening months of 2010. This change was mainly aimed at improving the focus on products (meaning e-commerce solutions) and increasing the scalability of productivity, identifying a specific area of platform engineering and, lastly, improving efficiency through greater operating independence of the work teams. This reorganization is linked to a new-look outsourcing strategy designed to improve efficiency and productivity in support of growing business requests. The basis of this strategy is, on the one hand, to identify a group of partners based on skill and, on the other hand, to pay close internal attention to the standardization of software solutions, production engineering and aspects of integration. This new organizational structure has quickly demonstrated advantages both in terms of greater productivity and in terms of the considerable improvements recorded in the quality of solutions adopted from the very first months of it being formalised. A plan for developing the performance of the websites to improve the response times of the pages for Internet users was implemented during the first half of the year, starting with infrastructure components and connectivity. At the same time a strong drive to consolidate management tools enabled an improvement in in-house productivity. The services of Dynamic Site Acceleration were introduced, there was a move to a 64 bit architecture, SSL & Compression offload, a new online catalogue generation process was introduced as well as the introduction of a new banner management tool. A series of CRM and Campaign Management solutions were announced to allow the full potential of interaction with customers to be exploited. These included the MEA Campaign Management project, a sophisticated system developed in-house, which integrates information coming from the Business Intelligence data structure, such as, for example, order history, website behaviour, etc., with the newsletter mailing system, in order to automate direct marketing actions on the basis of the user profile context. A series of other tools have also been included as well as this system, making it possible to display different communications on the Group websites according to user specifications, automatically recommend specific products to users according to their specifications and their website navigation history and to interact in the most up to date and direct way with specific users, selected according to their purchasing history. These functions have been incorporated in the new release of the yoox.com website, launched at the beginning of August 2010, being gradually introduced later on into the other Group websites. A large number of new e-commerce functions have been developed for the new 9.0 release of yoox.com. Their aim is to improve the presentation of the product, facilitate integration with the functions connected to video contents and, at the same time, improve performance as perceived by the final user through a revision of the technical navigation system (Ajax).

18 Calculated by dividing the overall total relating to the first half of 2010 by the number of orders processed at Group level in the same period of time.

YOOX GROUP


The new release has been delivered in a/b testing mode, a test method through which a basic version of the site (the current version) is compared in real time with the new version which is made available to an increasing number of visitors in order to test the improvements of the new features included in the new release and in order to reduce the risks connected with an immediate, full release. The release in a/b testing mode began on August 1 and will be completed within a fortnight. A restyled version of the yoox.com purchasing process known as fast checkout was activated during the first quarter of 2010. This took place through the radical improvement of the existing checkout and the introduction of new functions that support and simplify the operations of paying and filling in shipping details on yoox.com. A development project, known as YOOX APIs (Application Programming Interface) was activated in order to make it possible to take better advantage of the basic e-commerce functions supplied by the Group platform. This project allows external software to carry out standard product search, selection and purchasing operations directly. The positive effects of this project, initially devised to speed up the extension of the e-commerce functions in the mobile channel, were immediately obvious and were a concrete help in outsourcing some of the development activities. During the second quarter, once the first set of APIs for yoox.com were available, projects were launched like the first native iPad App for buying on yoox.com, a very interesting social project for integration between yoox.com and Facebook through a dedicated Facebook application on the occasion of the tenth birthday of YOOX and, lastly, a complex launch project for yoox.com on the Japanese mobile platform “Keitai”. Staff areas (Human Resources, Press Office, Administration, Finance and Control, Legal Department, Internal Audit, General Services and Investor Relations) contributed to the Group’s growth by supporting the business with appropriate operating tools. Refer to the dedicated sections for further details of some Staff areas. As far as the Administration, Finance and Control Departments are concerned, it should be pointed out that on May 11, 2010 Paolo Fietta resigned from his position as Chief Financial Officer and Financial Reporting Manager with effect from June 30, 2010. On July 1, 2010 the Board of Directors appointed Francesco Guidotti as the new Chief Financial Officer and Financial Reporting Manager.

In the first half of 2010, the Group made investments totalling Euro 4,025 thousand, Euro 2,841 thousand in intangible assets and Euro 1,184 thousand in tangible assets. Increases in intangible assets were mainly for investments in multi-year development projects currently under way valued at Euro 2,184 thousand. These are costs incurred by YOOX S.p.A. for specific projects aimed at the on-going development of innovative solutions for the creation and management of Online Stores. The development projects have been classified according to the area in which the various initiatives are carried out: development of e-commerce functionality, development of tools to support productivity, security and performance. In line with the strategy defined at the end of 2009, over the course of the second half-year period, the number of development projects at outside suppliers increased very substantially. The majority of these activities were aimed at management systems and process workflows in order to achieve a considerable improvement in internal productivity and the introduction of new functions that improve the presence of the Group websites in search engines and new experimental projects in the field of social networks. Costs for research, carried out with a view to obtaining new knowledge or making scientific or technical discoveries, are recognised in the income statement at the time they are incurred. Other investments in intangible assets refer mainly to software, licences and other Group intangible activities. Investments in tangible assets are mainly linked to technological infrastructure investments, the renewal/completion of office refurbishment, investment in new photographic studios at the Logistics Centre and investments relating to the application of Decree 81/2008 also at the Logistics Centre. There is a strong increase in financial investments through financial leasing contract agreements.

INVESTMENTS

YOOX GROUP


Summary consolidated statement sheet and financial position The following tables provide figures taken from the Group’s consolidated statement of financial position as of June 30, 2010, prepared in accordance with the IFRS endorsed by the European Union, and the Group’s consolidated statement of cash flows for the same period. Restated consolidated statement of financial position for the period to June 30, 2010:

Thousand Euro June 30, 2010 December 31, 2009 % change

Net working capital19 20,903 9,768 >100%

Non-current assets 13,970 10,883 28.4%

Non-current liabilities (excluding financial liabilities) (582) (572) 1.8%Net invested capital20 34,290 20,079 70.8%Shareholder’ Equity 59,353 54,077 9.8%Net debt/(net financial position)21 (25,063) (33,997) -26.3%

Total sources of financing 34,290 20,079 70.8% Reclassified cash flow statement of financial position for the period to June 30, 2010:

Thousand Euro June 30, 2010 June 30, 2009 % change

Cash flow generated by (used in) operating activities (4,806) 5,465 >100%

Cash flow generated by (used in) investing activities (3,670) (580) >100%

Sub-total (8,476) 4,885 >100%Cash flow generated by (used in) financing activities (14,577) (1,266) >100%

Total cash flow for the period (23,052) 3,619 >100% The net working capital went from Euro 9,768 thousand at December 31, 2009 to Euro 20,903 thousand at June 30, 2010. This result can mainly be attributed to the physiological increase in stocks (equal to Euro 11,471 thousand) due to the seasonal nature of the supplies necessary to meet expected growth and the buying campaign for the 2010-2011 Autumn/Winter season which is concentrated in the last part of the half-year period. This increase is reflected on trade payable increased by Euro 7,273 thousand also through the effect of the extension of payment terms agreed with suppliers. The working capital was also affected by the reduction in the other debts and current liabilities (excluding financial liabilities) of Euro 6,780 thousand. The result for the period (Euro 3,339 thousand), the increase in the Stock Option reserve (Euro 1,319 thousand) and the Stock Option exercise in the period (Euro 92 thousand) are the main changes that have taken place in the consolidated equity items, which went from Euro 54,077 thousand at December 31, 2009 to Euro 59,353 thousand at June 30, 2010.

19 Working capital is current assets, net of current liabilities, with the exception of cash and cash equivalents, bank loans and borrowings and other financial

payables due within one year and financial assets and liabilities included under other current assets and liabilities. Working capital is not recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union. The measurement criterion adopted by the Company might not be consistent with that adopted by other groups, and accordingly, the balance obtained by the Company may not be comparable with those calculated by such groups.

20 Net invested capital is the sum of working capital, non-current assets and non-current liabilities, net of non-current financial liabilities. Net invested capital is not recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union. The measurement criterion adopted by the Company might not be consistent with that adopted by other groups, and accordingly, the balance obtained by the Company may not be comparable with those calculated by such groups.

21 Net debt (or net financial position) is the sum of cash and cash equivalents, other current financial assets, net of bank loans and borrowings and other financial payables falling due within one year, other current financial liabilities and non-current financial liabilities. Net debt (or net financial position) is not recognised as an accounting measure under Italian GAAP or the IFRS endorsed by the European Union. The measurement criterion adopted by the Company might not be consistent with that adopted by other groups, and accordingly, the balance obtained by the Company may not be comparable with those calculated by such groups. For details on the items that make up net debt (or net financial position), see the table below in the section “Debt/Net financial position.”

FINANCIAL MANAGEMENT

YOOX GROUP


The net financial position of the Group went from Euro 33,997 at December 31, 2009 to Euro 25,063 thousand at June 30, 2010. The cash flow absorbed by the operating activities was greatly affected in the half-year period by the payment of taxes relating to the 2009 fiscal year and to the advance for 2010 of Euro 4,837 thousand, with only a marginal impact in the first half of 2009. Also during the half-year period, mainly in the first months of 2010, the payment of business debts (Euro 3,531 thousand) and tax liabilities (Euro 3,645 thousand) took place relating to the quotation and exercising of the Stock Option at the close of the fiscal year at December 31, 2009. The operating performance, net of these payments, continues to generate cash. Investment activities, meanwhile, used up Euro 3,670 thousand in financial resources, principally for investments in technology. Debt/Consolidated net financial position The table below provides details on the YOOX Group’s net financial position at June 30, 2010. Thousand Euro June 30, 2010 December 31, 2009 % change

Cash and cash equivalents 11,955 35,007 -65.9%

Other current financial assets 14,604 16 >100%

Bank loans and other current financial liabilities (479) (313) 53.3%

Other current financial liabilities (115) (20) >100%

Short-term net financial position 25,964 34,690 -25.2%Financial liabilities (902) (693) 30.1%

Consolidated net financial position 25,063 33,997 -26.3% In accordance with the Group’s organizational structure, treasury operations are centralised at the Parent, YOOX S.p.A., which manages all lines of credit provided to the Group. The Group’s policy is to maintain an adequate margin of financial flexibility through available “committed” lines of credit, which, at present, are unused. Cash and cash equivalents totalled Euro 11,955 thousand at June 30, 2010 and are made up of cash, negotiable instruments and demand deposits or short-term deposits with banks, which are actually available and readily usable. Other current financial assets, equal to Euro 14,604 thousand, include Euro 14,588 thousand of investments in Repurchase Agreements with a low risk profile and short term (less than twelve months) agreed with major national Credit Institutions with a high credit rating. At June 30, 2010, financial liabilities to banks and other financial institutions amounted to Euro 1,381 thousand, an increase compared with December 31, 2009 following the signing of new financial leasing contracts agreed for financing investments in technology. Debts to the BNP Paribas Lease Group come to Euro 919 thousand, whilst the residual debt of the financing provided by Simest (Società Italiana per le Imprese all’Estero) is Euro 463 thousand.

The Global IPO for YOOX S.p.A shares (ISIN Code IT0003540470) was successfully concluded in December 2009. Starting from December 3, 2009, the Company’s shares have been listed on the STAR segment of Borsa Italiana. The price of the Public Offering was set at Euro 4.3 per share within a projected range of Euro 3.6 to Euro 4.5 corresponding to a stock exchange capitalisation of Euro 216.7 million. At June 30, 2010 the YOOX stocks recorded a closing price of Euro 5.7, with the stock exchange capitalisation equal to Euro 291.7million. Since entering the stock market on June 30, 2010 the YOOX share performance showed an increase of 32.8% compared with the share issue price, whilst in the first half-year period at June 30, 2010 the shares recorded a growth of 9.4% compared with the closing price at December 30, 2009 (last day of trading for 2009).

INFORMATION FOR INVESTORS

YOOX GROUP


Performance of YOOX stock in the first half of 2010

1/1/10

8/1/10

19/1/10

28/1/10

5/2/10

15/2/10

24/2/10

5/3/10

12/3/10

23/3/10

1/4/10

9/4/10

19/4/10

28/4/10

7/5/10

14/5/10

25/5/10

3/6/10

11/6/10

21/6/10

30/6/10

€4.80

€5.00

€5.20

€5.40

€5.60

€5.80

€6.00

€6.20

€6.40

€6.60

€6.80

€7.00

€7.20

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

2,200

2,400

2,600

2,800

3,000

Price YOOX S.p.A. Volume (Thousands) Source: Factset. The performance of the YOOX stock during the reference period was around 16.7% higher than the FTSE Italy Star index which recorded a loss of 7.3%. Performance of YOOX stock and FTSE Italy STAR index in the first half of 2010

01/01/10

08/01/10

19/01/10

28/01/10

05/02/10

15/02/10

24/02/10

05/03/10

12/03/10

23/03/10

01/04/10

09/04/10

19/04/10

28/04/10

07/05/10

14/05/10

25/05/10

03/06/10

11/06/10

21/06/10

30/06/10

80

90

100

110

120

130

140

-7.3%

9.4%

YOOX S.p.A. FTSE Italy STAR Source: Factset.

YOOX GROUP


The table below summarises key stock and stock exchange data for the first half of 2010. Stock and stock exchange data June 30, 2010

Closing price as of Jun 30, 2010 (Euro) 5.710

Maximum closing price in the first half of 2010 (Euro) – 04/26/2010 7.250

Minimum closing price in the first half of 2010 (Euro) – 02/12/2010 5.095

Market capitalisation as of Jun 30, 2010 (Euro million) 291.710

Source: Borsa Italiana Stock analyst coverage In addition to the global coordinators for the IPO, Goldman Sachs International and Mediobanca, the stock analyst coverage of the YOOX stock includes Equita, Intermonte, Gruppo24Ore, Berenberg and Bryan, Garnier & Co., a total of 7 financial analysts, with the last two having launched their coverage in July 2010. YOOX has been given favourable ratings by analysts with 5 Buy/Outperform ratings, 1 Marketperform rating, and 1 Neutral rating, with a target price of between Euro 5.33 and 9.00 per share. Shareholder structure As of June 30, 2010, share capital totalled Euro 510,875.56, corresponding to a total number of 51,087,556 shares with no nominal value pursuant to Article 2346 of the Civil Code. Based on the information in the possession of the Company, in June 2010, Nestor 2000 S.p.r.l., Kiwi I Ventura Serviços S.A. Em Liquidaçao and Kiwi II Ventura Serviços de Consultadoria S.A, venture capital funds and shareholders of the YOOX Group since 2000, transferred their entire share participation to the share capital of YOOX S.p.A.. As of June 30, 2010 shareholders owning more than 2% of ordinary shares, as specified by CONSOB regulations, were as follows: Shareholders June 30, 2010

Balderton Capital L.P. 11.491%

Red Circle S.r.l. 6.221%

Federated Equity Management Company of Pennsylvania 5.042%

Essegi S.r.l. 4.848%

JP Morgan Asset Management 4.830%

Federico Marchetti 4.721%

Invesco LTD 2.040%

Pictet Funds S.A. 2.035%

Source: Shareholder Register as of June 30, 2010. Investor Relations activities The Group takes a special interest in the development of relationships with analysts, its shareholders and institutional investors. In the first half of the year the Group’s activities were divided between participation in large conferences and the organization of numerous road shows in some of the main financial centres in Europe and the United States. Following the listing, communication activities continued in accordance with the rules dictated by Borsa Italiana on price-sensitive press releases, in keeping with the Group’s intention to provide timely and transparent information to promote relations with the financial community.

YOOX GROUP


In the first half of 2010, privacy-related activities focused on the following issues:

- updating front-end security systems through the following actions: o the introduction of an intrusion detection system at network level; o fine tuning of the software implemented in December 2009, in compliance with controlling system

administrator activities; o hardening of the front-end systems in order to provide correct support for recording credit card

numbers following the PCI directives for compliance with regard to the directives of the main circuits;

- Online Store privacy policy assessment and review, which is still not considered fully operational and is expected to be completed in the coming months;

- mailing system process review and support for third parties (business mailing for business partners), through the introduction of a process that reduces the risk of information of a personal nature relating to payments being circulated through the use of encrypted channels.

The requirements set out by the data protection document on security have been implemented, in accordance with Annex B of legislative decree 196/03 “Personal data protection code”, which establishes technical specifications regarding the processing of sensitive data by electronic means.

The Group incurred a greater tax burden in absolute terms than at June 30, 2009. Current taxes rose from Euro 2,101 thousand to Euro 2,748 thousand. IRAP taxes rose 42% for the Parent, from Euro 324 thousand as of June 30, 2009 to Euro 461 thousand as of June 30, 2010. IRES taxes for the Parent were Euro 848 thousand. With respect to the period ending June 30, 2009, the Group’s foreign companies had a tax burden of about Euro 1,439 thousand, due entirely to higher taxable profits resulting from growth in operations during the year ending June 30, 2010. The Group also allocated deferred tax assets totalling Euro 3,341 thousand and deferred tax liabilities of Euro 49 thousand. Deferred tax assets of Euro 2,844 thousand and deferred tax liabilities of Euro 26 thousand that were allocated in 2009 were also reversed. It should also be noted that the amount posted to the income statement does not include the Euro 403 thousand in deferred tax assets posted directly as a matching entry to the share premium reserve pursuant to IAS 32. In addition, Euro 537 thousand in deferred tax assets posted directly as a matching entry to the share premium reserve in 2009 were reversed.

In 2010 the Group signed, among other things:

- three important electronic commerce contracts for the creation and management of virtual shops for the sale of clothing and fashion accessories, became operational in February and March 2010;

- an extended contract for new markets as well for an Online Store which is already operating. As of June 30, 2010 there were no changes compared with December 31, 2009 in pending legal disputes as a plaintiff or defendant.

LEGAL MATTERS

TAX MATTERS

PERSONAL DATA PROTECTION CODE

INFORMATION CONCERNING MEASURES TO PROTECT PRIVACY

YOOX GROUP


At June 30, 2010 the Company was a defendant in pending legal disputes related to (i) two labour lawsuits brought against YOOX by a former manager (currently pending before the Court of Bologna); (ii) a lawsuit on the merits brought against YOOX by a Monaco company for alleged violations in the area of unfair competition (currently pending before the Court of Paris). Still with reference to the position of YOOX towards the above mentioned Monaco company, it should be pointed out that the appeal proceedings instigated by YOOX against the Court of Paris’ finding in favour of the Monaco company were concluded on June 30, 2010 through an urgency measure, introduced in time by the latter (concluded in 2009) and aimed at annulling the decree issued. At June 30, 2010 the Company was a plaintiff in the following pending matters: (i) a civil and criminal law suit brought by YOOX against the former tax representative for Greece (at the competent Greek court) aimed at recovering amounts illegally withheld by the above party; (ii) three actions to recover receivables brought by YOOX against counter-parties that failed to fulfil their payment obligations; (iii) a criminal suit brought by YOOX against one of the three defaulting counter-parties noted in (ii) above.

The Company confirms the essential importance of continuing to implement a sound human resources management policy. It is aware that meeting corporate growth and business development goals is dependent upon the enhancement of human resources, the development of the capabilities and skills of individual employees and the retention of key employees. As of June 30, 2010, the Group recorded a net increase of 82 staff which represented a rise of 33% compared with the same period of the previous year. The table below shows a breakdown of the headcount as of June 30, 2010 compared with that of June 30, 200922 No. June 30, 2010 June 30, 2009 ChangeManagers 16 13 3Junior managers 29 16 13Employees and Trainees 269 205 64Abroad 20 18 2Total headcount 334 252 82 As of December 31, 2009 the Group had a total staff of 287, showing a net increase of 47 resources i.e. 16%. With these levels of growth, research and selection continues to be of fundamental importance for the company, extensively involving the recruiting team whose goal is not only to find the ideal candidate but to integrate him/her into the company very quickly. The research and selection team continues to refine the research methodology and talent scouting through the establishment of new contacts with leading universities and business schools nationally and internationally and by organizing presentations and lectures led by company management. The personnel office is key to ensuring efficient and timely completion of all procedures relating to establishing new working relationships and managing existing labour relations. Particular attention has been paid to managing the process of seconding certain employees with an Italian contract to the company’s foreign sites. During the first half of 2010 the company created numerous training opportunities, organizing various courses including: “Italian for foreigners”; “Bargaining skills, business success”; “Communicating fashion and brand management” (organized with the Institute Polimoda in Florence); “Excel” (basic and intermediate); “PowerPoint”; “Web Marketing for the uninitiated”, as well as various computer and professional development courses. Also in the first half, the U.S. headquarters was relocated to new, more efficient and wide offices in New York. With effect from April 1, 2010, Francesca Gandolfi resigned from her post of Director of Human Resources and on May 11, 2010 the Board of Directors appointed Giuseppe Guillot as the new Director of Human Resources and Organization.

22 The headcount does not include the Chief Executive Officer of Yoox S.p.A., interns or consultants.

HUMAN RESOURCES

YOOX GROUP


The following are the key points on which the Human Resources department focused in the first half of 2010. Assessment and development of human resources To improve the company’s professionalism, a skills assessment system was created and developed, integrated with the economic incentive system. Each employee will be evaluated by his manager, based on corporate key skills and technical know-how specific to the role. Throughout the month of February, around 50 managers/evaluators were trained to provide conceptual and operational tools needed to correctly assess the skills of employees and with which to communicate all of the stages that characterize the process. A first pilot, on the assessment of skills relating to the year 2009, was conducted between February and March 2010. Remuneration policy A new appraisal and incentive system called “Performance Evaluation” was introduced in the first quarter of 2010. The inclusion of this new system confirms that YOOX is adopting a results-based approach and on motivating the individual in order to achieve individual and corporate goals. “Performance Evaluation” is an integrated system that analyses what added value is created by each individual employee against the company’s established and expected objectives. The system consists of a first part in which skills are assessed and a second part linked to an evaluation of the extent to which objectives are attained (MBO), providing objective input to determine how much variable compensation should be paid to employees who benefit from economic incentives.

The Group’s philosophy is based on the need to help protect the environment and combat climate change by improving the energy efficiency of its buildings, reducing the impact from transport, continuously monitoring energy consumption to optimise use and reduce waste, using low-consumption lighting and IT components, using renewable energy and reducing waste from its operations. The environment is a key asset that YOOX is committed to protecting by planning activities aimed at achieving a balance between business operations and inescapable environmental requirements, and in so doing, it has decided to adopt a true strategy of environmental responsibility: YOOXYGEN. The Group’s approach to environmental responsibility underpins the various initiatives implemented within the organisation that involve the whole Company and minimise its environmental impact. On the occasion of Earth Day on April 22, YOOXYGEN celebrated its first birthday, presenting many new items online: a wide selection of eco-friendly products, limited edition collections exclusive to YOOXYGEN created by different designers. With the creation of YOOXYGEN, the Group has chosen to support Green Cross International through various projects, particularly favouring development programmes relating to climate change. In 2010, the project that the Group has chosen to support is “Smart Water for Green Schools”, the new environmentalist non-governmental organization (NGO) that aims to institute systems for rainwater collection, ecological rehabilitation equipment and environmental awareness in schools located in crossborder water basins. The first schools started the pilot phase in Ghana in February 2010 with the goal of reaching 1,987 school children and 67 teachers in five communities. Over the next 24 months, it is planned to extend the project to 40 schools in four water basins. The path of environmental sustainability that the Group has chosen to go down will be strengthened and developed over time with the aim of transforming it into an ongoing company practice in the future. During the first half, YOOX continued to pursue its commitments to the environment, namely:

- to manage its activities in such a way as to minimise their environmental impact; - to consider the environmental risks in corporate decisions; - to improve internal eco-efficiency; - to raise employees’ awareness in order to strengthen the culture of sustainability; - to promote the development and dissemination of eco-friendly projects and products; - to raise customers’ awareness regarding the choice of eco-friendly products.

THE ENVIRONMENT

YOOX GROUP


The administration and control model used by the Parent YOOX S.p.A. is the traditional model (as prescribed by Italian law), based on the existence of a Shareholders’ meeting, a Board of Directors and a Board of Statutory Auditors. Corporate bodies are appointed by the Shareholders’ Meeting and remain in office for three years. Shareholders’ meeting The Shareholders’ meeting is convened and votes on items at ordinary and extraordinary sessions as required by law and the Company’s bylaws. On April 21, 2010 a meeting was held of the YOOX Shareholders which:

- approved the financial statements at December 31, 2009, resolving to carry forward the operating result; - modified the audit assignment conferred under Artt.155 et seq. of Legislative Decree 58/1998 to KPMG

S.p.A. by the Ordinary Shareholders’ meeting of the Company on September 8, 2009 with recalculation of their fees as a result for financial years 2009-2017;

- appointed as a member of the Board of Directors, the director Catherine Gérardin previously co-opted by way of an act dated October 29, 2009.

Share capital and share ownership as of June 30, 2010 As of June 30, 2010, share capital totalled Euro 510,875.56 corresponding to total shares of 51,087,556. It should be noted that this number of shares was the result of a decision dated September 3, 2009 made by the Shareholders’ meeting, which voted to split the number of ordinary shares, following elimination of the nominal value, with an implicit unit price of Euro 0.01. Out of total shares as of June 30, 2010, 41.2% are held by shareholders owning more than 2% of the share capital, as detailed in the section on Information for Investors, and the remaining 58.8% is free float/held by others. Compared with the situation on December 31, 2009, pursuant to decisions of the Board of Directors on January 18, 2010 and May 11, 2010, 683,800 new shares were subscribed with a nominal value of Euro 6,838.00 following the exercise of stock options by five beneficiaries. With the exception of the lock-up agreement signed by the Issuer and Red Circle S.r.l. Unipersonale on March 16, 2009, there are no existing agreements among shareholders in that the previous agreement lapsed with the resolution to seek authorization for listing. Over the years, several stock option plans have been implemented for the benefit of senior and middle management. These are described in detail in the condensed interim consolidated financial statements at June 30, 2010, to which reference should be made. It should be noted that, after June 30, 2010, on July 1, 2010, the Board of Directors of YOOX approved the allocation of 13,965 options corresponding to 726,180 ordinary shares of YOOX S.p.A. related to the 2009 – 2014 Stock Option Plan, approved on March 11, 2010. On the same date, the Board also approved the Regulations of the YOOX S.p.A. Company Incentive Plan for 2009 – 2014 and decided on the bonus grant of 124,436 YOOX S.p.A. ordinary shares to 25 employees. Board of Directors The Parent Company is managed by a Board of Directors consisting of seven directors elected by the shareholders’ meeting, not including Director Raffaello Napoleone, co-opted on July 1, 2010: - Federico Marchetti (Chairman and Chief Executive Officer); - Raffaello Napoleone (Director); - Mark Evans (Director); - Catherine Gérardin (Director); - Massimo Giaconia (Director); - Elserino Piol (Director); - Stefano Valerio (Director).

CORPORATE GOVERNANCE

YOOX GROUP


The Chairman of the Board of Directors and all Directors were appointed by resolution dated October 7, 2009, with the exception of Director Catherine Gérardin who was appointed by co-optation in a resolution dated October 29, 2009; they will remain in office until approval of the financial statements at December 31, 2011. On October 7, 2009, the Shareholders’ meeting revised the total maximum annual remuneration payable to the management body and, on the same date, the Board of Directors decided on how to allot this remuneration. The Ordinary Shareholders’ Meeting of April 21, 2010 appointed as a member of the Board of Directors the director Catherine Gérardin, previously co-opted by way of an act dated October 29, 2009. It is also pointed out that after June 30, 2010, on July 1, 2010, the Board of Directors accepted the resignation of director Fausto Boni, with effect from July 1, 2010, and co-opted the new Director, Raffaello Napoleone, also appointing him a member of the Internal Control Committee. Committees Committee members were appointed by the Board of Directors on October 7, 2009, with the exception of the member of the Internal Control Committee, Raffaello Napoleone, who was co-opted on July 1, 2010. The composition of each committee is illustrated below. Remuneration Committee: - Elserino Mario Piol (Chairman), Non-Executive Director; - Catherine Gérardin, Independent Non-Executive Director; - Massimo Giaconia, Independent Non-Executive Director. This Committee met on January 27, 2010 and March 11, 2010 and voted in favour of the following proposals: - Proposal for the award of variable compensation to the Managing Director for the financial year 2010; - Proposal to award Stock Options to the CEO; - Proposal to award Stock Options to some members of top management; - Proposal to award the variable component (MBO) of earnings for the year 2010 to the same persons as in the

previous proposal.

Internal Control Committee: - Massimo Giaconia (Chairman), Independent Non-Executive Director; - Raffaello Napoleone, Non-Executive Director (from July 1, 2010, appointed to replace Fausto Boni who

resigned); - Catherine Gérardin, Independent Non-Executive Director. This Committee met on February 22, 2010. Director Nominating Committee - Massimo Giaconia (Chairman), Independent Non-Executive Director; - Catherine Gérardin, Independent Non-Executive Director; - Stefano Valerio, Non-Executive Director. This committee did not meet during the first half of 2010. Chairman and Chief Executive Officer On October 7, 2009, the Board of Directors confirmed Federico Marchetti, the founding shareholder of the YOOX Group, as the Chairman and Chief Executive Officer until approval of the financial statements at December 31, 2011. He was granted broad powers for the administration of the Parent including, but not limited to, signature powers on behalf of the Company and to serve as its legal representative with respect to third parties and in legal matters, with the exception of decisions on matters that are the specific remit of the Board of Directors. Board of Statutory Auditors The Board of Statutory Auditors is made up of three standing auditors and two alternate auditors appointed by the Shareholders’ meeting. The current Board of Statutory Auditors was appointed by resolution dated October 7, 2009, and will remain in office until the approval of the financial statements at December 31, 2011. The Board’s members are as follows: - Filippo Tonolo (Chairman);

YOOX GROUP


- Luca Sifo (Regular Auditor); - David Reali (Regular Auditor); - Nicola Bottecchia (Alternate Auditor); - Edmondo Maria Granata (Alternate Auditor). Director in charge of preparing corporate accounting documents Pursuant to Article 154-bis of Legislative Decree No. 58 of February 24, 1998, the Director in charge of preparing corporate accounting documents is the same person as the Director of Administration, Finance and Control. The Board of Directors met on July 1, 2010 and appointed Francesco Guidotti to this position. The Director in charge of preparing corporate accounting documents is responsible for preparing appropriate administrative procedures for drawing up the separate and consolidated financial statements, certifying the actual application and adequacy of such procedures, and confirming that all communications concerning the Company’s financial statements captions are truthful. Francesco Guidotti was appointed as Director in charge of preparing corporate accounting documents by the Board of Directors on July 1, 2010, in place of Paolo Fietta who resigned with effect from June 30, 2010. Independent auditors On September 9, 2009, subject to the beginning of trading in anticipation of the positive outcome of the listing process, the Company’s ordinary Shareholders’ meeting voted to appoint KPMG S.p.A. to audit the separate and consolidated financial statements at and for the year ended December 31, 2009 and at and for the years ending December 31, 2010-2017 pursuant to Article 159 of the Consolidated Finance Law. On April 21, 2010, the ordinary Shareholders’ meeting decided to modify the above assignment to render it conforming to current regulations. Internal Audit The Internal Audit function, set up in YOOX S.p.A. in January 2009, carried out the audit activities set out in the plan approved by the Company for the year 2010. The Internal Audit supported the Director in charge of preparing corporate accounting documents with regulatory compliance pursuant to Law 262/05, performing the monitoring related-activities set out in the audit plan and concerning the half-year reporting for financial year 2010. The Internal Audit department also provided support to the Supervisory Body of YOOX S.p.A. with the implementation and development of the compliance activities required by Legislative Decree 231/2001 as well as those included in the audit plan on the basis of the provisions of the Organisational, Management and Control Model pursuant to Legislative Decree 231/2001. In addition, the Internal Audit function, in the person of its manager Pietro Tagliati, provided for development and oversight of all the activities forming part of the broader system of Internal Control. Internal Control Manager With the favourable opinion of the Internal Control Committee and with a resolution dated December 4, 2009, the Board of Directors appointed as Internal Control Manager, Pietro Tagliati, already head of Internal Audit, in accordance with art. 8, para. 7 of the Corporate Governance Code. The Internal Control Manager is responsible for ensuring that the internal control system is consistently suitable and fully operational, but is not responsible for any operating area. He/She has direct access to all information useful for the performance of his/her duties. The job description of the person in charge of Internal Control was set out in the audit plan approved on February 2, 2010 by the Director appointed to oversee operation of the internal control department and on February 22 by the Internal Control Committee. Supervisory Body pursuant to Legislative Decree 231/01 The Company adopted the Organisational, Management and Control Model specified by Legislative Decree 231/01 and the Code of Ethics by a resolution of the Board of Directors dated September 3, 2009.

YOOX GROUP


The Supervisory Body, which must satisfy the requirements of autonomy, independence and professionalism, and which has been granted inspection and control powers as well as the powers and duties specified by the Model set forth in Legislative Decree 231/01, was appointed by the Board of Directors in a resolution dated September 8, 2009. The body is composed of three members in the persons of Rossella Sciolti, an independent member, as Chairwoman, Gerardo Diamanti (appointed on July 1, 2010 in place of Francesco Guidotti), an independent member, and Pietro Tagliati, the Company’s Internal Audit Manager. With the support of the Internal Audit department, the Supervisory Body has initiated and is managing the development of the compliance measures specified in Legislative Decree 231/2001 and those set out in the audit plan defined on the basis of the provisions of the Organisational, Management and Control Model pursuant to Legislative Decree 231/01.

Relations among the Group companies or with the latter and related parties cannot be defined as either atypical or unusual, as they come under the normal course of the Group’s business. In general, there were no atypical or unusual transactions. For additional details, see the notes to the condensed consolidated interim financial statements at June 30, 2010. These transactions were carried out under normal market conditions, i.e., under the same conditions that would apply between two independent parties. All receivables, liabilities and related costs and revenues incurred among Group companies are reported in detail in the notes to the condensed consolidated financial statements at June 20, 2010. For trade transactions between Group companies and parties included among shareholders and/or directors, see the notes to condensed consolidated interim financial statements at June 30, 2010. For the financial statements impact of the Group transactions with related parties, see the notes to the condensed consolidated interim financial statements at June 30, 2010.

Newly appointed Chief Financial Officer and Director in charge of preparing corporate accounting documents On July 1, 2010 the Board of Directors appointed Francesco Guidotti as the new Chief Financial Officer and Director in charge of preparing corporate accounting documents, following the resignation of Paolo Fietta with effect from June 30, 2010. Co-opting of a director and appointment of a member of the Internal Control Committee On July 1, 2010 the Board of Directors co-opted as a member of the Board Raffaello Napoleone, in view of the resignation of the director Fausto Boni. Raffaello Napoleone was also appointed member of the Internal Control Committee, a position previously held by Fausto Boni. Appointment of the new Board of Directors of YOOX Corporation On July 1, 2010, the new Board of Directors was appointed of the subsidiary company YOOX Corporation. Appointment of a member of the Supervisory Body On July 1, 2010 the Board of Directors, following the resignation of Francesco Guidotti as member of the Supervisory Body, appointed Gerardo Diamanti as his replacement. Granting of the 2009-2014 Stock Option Plan and YOOX S.p.A. 2009-2014 Incentive Plan On July 1, 2010, the Company’s Board of Directors decided to grant 13,965 options related to 726,180 YOOX S.p.A. ordinary shares in relation to the 2009-2014 Stock Option Plan, approved on March 11, 2010. On the same date the Board also approved the Regulations of the YOOX S.p.A. Company Incentive Plan for 2009-2014 and decided on the free allocation of 124,436 YOOX S.p.A. ordinary shares to 25 employees. Start of own shares buyback programme On July 13, 2010 the Company announced that it has initiated a programme to purchase its own shares, pursuant to the resolutions passed by the shareholders on October 7, 2009 and the Board of Directors on July 1, 2010.

TRANSACTION AMONG GROUP COMPANIES AND WITH RELATED PARTIES

SUBSEQUENT EVENTS

YOOX GROUP


To date, YOOX S.p.A. has purchased, through Mediobanca Banca di Credito Finanziaria S.p.A., in the period from July 2, 2010-July 7, 2010, a total of 62,000 YOOX S.p.A. ordinary shares, representing 0.1214% of the share capital, at an average price of Euro 5.836485 per share before fees, for a total of Euro 361,862.06. New Release 9.0 yoox.com The new 9.0 release of yoox.com was launched at the beginning of August 2010, which incorporated CRM functions (Recommendation Engine and Behavioural Targeting). A significant number of new e-commerce functions were also developed in order to improve the presentation of the product (such as, for example, the full screen zoom), the perception of performance through a functional and technical revision of the navigation and search system and, lastly, the integration of the video contents to give the user an experience where they feel more involved. Exercise of Stock Options Following the decision of the Board of Directors on August 5, 2010, there was a subscription of 174,200 new shares for a nominal value of Euro 1,742.00 following the stock option exercise by a beneficiary.

In the second half of the fiscal year 2010, taking into account the Group results for the first half and the trend of business metrics in the online retail market, it is reasonable to assume that the Group will confirm a growth in net sales and profitability compared with the results achieved in the second half of 2009. It is also reasonable to expect a contribution to growth from both the Multi-Brand and the Single-brand business lines, so that more Online Stores will in all probability be launched by the end of 2010. Actions will continue to achieve further international development, as well as internal ones geared to improving efficiency and all those designed to help achieve prudent management and cost control so as to take advantage of the synergies generated by the operating leverage. It is also planned to continue with the policy of investment in innovation, aimed at consolidating and at constantly upgrading the proprietary technology platforms.

Zola Predosa (BO), August 5, 2010 For the Board of Directors

The Chairman of the Board of Directors Federico Marchetti

(signed on the original)

BUSINESS OUTLOOK

YOOX GROUP


CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS AT JUNE 30, 2010

YOOX GROUP

YOOX GROUP


YOOX GROUP


Consolidated financial statement at June 30, 2010 prepared in accordance with IFRS ....................................41 Consolidated income statement .......................................................................................................................41 Consolidated statement of comprehensive income ..........................................................................................42 Consolidated statement of financial position.....................................................................................................43 Statement of changes in consolidated equity at Jun 30, 2009 and Jun 30, 2010 .............................................44 Consolidated statement of cash flows ..............................................................................................................45 Notes to the Condensed consolidated interim financial statements at June 30, 2010......................................46

INDEX

YOOX GROUP


YOOX GROUP


Consolidated income statement Thousand euro Notes Jun 30, 2010 Jun 30, 2009

Net revenues 9.1 96,554 68,305 Cost of goods sold 9.2 (59,445) (42,635)Fulfillment costs 9.3 (10,220) (7,566)Sales and marketing costs 9.4 (11,425) (7,843)General expenses 9.5 (9,916) (6,344)Other income and expenses 9.6 (240) (624)Non-recurring expenses 9.7 - - Operating profit 9.8 5,308 3,293 Financial income 9.9 843 337 Financial expenses 9.10 (539) (1,053) Profit before tax 5,612 2,577 Tax 9.11 (2,273) (1,015) Consolidated profit for the period 3,339 1,562 of which: attributable to owners of the Parent 3,339 1,562 attributable to non-controlling interests - - Basic earnings per share* 9.12 0.07 0.04 Diluted earnings per share* 9.12 0.06 0.03 * Post split (see section 9.12 of the current condensed consolidated interim financial statements) ** The financial statements, which were prepared in accordance with CONSOB Resolution 15519 of July 27, 2006 and CONSOB

Communication No. DEM/6064293 of July 28, 2006, are annexed to the notes to the condensed consolidated interim financial statements at June 30, 2010.

CONSOLIDATED FINANCIAL STATEMENT AT JUNE 30, 2010 PREPARED IN ACCORDANCE WITH IFRS **

YOOX GROUP


Consolidated statement of comprehensive income Notes Jun 30, 2010 Jun 30, 2009Thousand euro Consolidated profit for the period 3,339 1,562 Other components of comprehensive income net of tax effects

Foreign currency translation differences for foreign operations 9.21 525 (91) Profit/(loss) from cash flow hedges 9.21 - 3 Total other comprehensive income 525 (88) Total consolidated comprehensive income for the period 3,864 1,474 of which: attributable to owners of the Parent 3,864 1,474 attributable to non-controlling interests - -

YOOX GROUP


Consolidated statement of financial position Notes Jun 30, 2010 Dec 31, 2009Thousand euro Non-current assets Property, plant and equipment 9.13 4,060 3,508Intangible assets with finite useful life 9.14 5,368 3,420Deferred tax assets 9.15 4,034 3,546Other non-current financial assets 9.16 508 409 Total non-current assets 13,970 10,883 Current assets Inventories 9.17 58,525 47,054Trade receivables 9.18 5,703 6,743Other current assets 9.19 4,409 3,213Cash and cash equivalents 9.20 11,955 35,007Financial current assets 9.20 14,588 - Total current assets 95,180 92,017 Total assets 109,150 102,900 Equity Share capital 511 504Reserves 60,867 58,937Losses carried forward (5,364) (9,462)Consolidated profit for the period/year 3,339 4,098 Equity attributable to equity holders of the Parent 9.21 - 9.22 59,353 54,077Equity attributable to non-controlling interests - - Total consolidated equity 59,353 54,077 Non-current liabilities Financial liabilities 9.23 902 693Employee benefits 9.24 207 219Provisions for risks and charges 9.26 310 310Deferred tax liabilities 9.25 64 43 Total non-current liabilities 1,484 1,265 Bank loans and other current financial liabilities 9.23 479 313Provisions for risks and charges 9.26 662 538Trade payables 9.27 34,528 27,254Tax liabilities 9.28 813 3,913Other payables 9.29 11,831 15,540 Total current liabilities 48,313 47,558 Total consolidated equity and liabilities 109,150 102,900

Stat

emen

t of c

hang

es in

con

solid

ated

equ

ity a

t Jun

30,

200

923

Thou

sand

eur

o S

hare

cap

ital

Sha

re p

rem

ium

re

serv

e an

d ot

her

equi

ty-r

elat

ed

rese

rves

Lega

l re

serv

eH

edgi

ngre

serv

eStoc

k op

tion

rese

rve

Tran

slat

ion

rese

rve

Ret

aine

d ea

rnin

gs

or lo

sses

car

ried

forw

ard

Con

solid

ated

pr

ofit

(loss

)fo

r the

per

iod

Equ

ity

attri

buta

ble

to

non-

cont

rolli

ng

inte

rest

s

Tota

l

Dec

embe

r 31,

200

8 40

122

,666

2313

2,57

848

(11,

696)

2,40

2-

16,4

35S

hare

cap

ital i

ncre

ases

22

5,40

5-

--

--

--

5,42

7In

crea

ses

in re

serv

es fo

r sha

re-b

ased

pay

men

ts

--

--

272

--

--

272

Tota

l con

solid

ated

com

preh

ensi

ve in

com

e -

--

3-

(91)

-1,

562

-1,

474

Oth

er c

hang

es

--

170

--

-2.

234

(2,4

02)

-2

June

30,

200

9 42

328

,071

193

162,

850

(43)

(9,4

62)

1,56

2-

23,6

10 St

atem

ent o

f cha

nges

in c

onso

lidat

ed e

quity

at J

un 3

0, 2

010

– Pa

ragr

aph

9.21

Thou

sand

eur

o S

hare

cap

ital

Sha

re p

rem

ium

re

serv

e an

d ot

her

equi

ty-r

elat

e d

rese

rves

24

Lega

l re

serv

eH

edgi

ngre

serv

eStoc

k op

tion

rese

rve

Tran

slat

ion

rese

rve

Ret

aine

d ea

rnin

gs

or lo

sses

car

ried

forw

ard

Con

solid

ated

pr

ofit

(loss

)fo

r the

per

iod

Equ

ity

attri

buta

ble

to

non-

cont

rolli

ng

inte

rest

s

Tota

l

Dec

embe

r 31,

200

9 50

454

,542

193

-4,

229

(27)

(9,4

62)

4,09

8-

54,0

77S

hare

cap

ital i

ncre

ases

7

85-

--

--

--

92In

crea

ses

in re

serv

es fo

r sha

re-b

ased

pay

men

ts

--

--

1,31

9-

--

-1,

319

Tota

l con

solid

ated

com

preh

ensi

ve in

com

e -

--

--

525

-3,

339

-3,

864

Oth

er c

hang

es

--

--

--

4,09

8(4

,098

)-

-Ju

ne 3

0, 2

010

511

54,6

2719

3-

5,54

949

8(5

,364

)3,

339

-59

,353

23 I

n re

latio

n to

the

stat

emen

t of c

hang

es in

con

solid

ated

equ

ity fo

r the

firs

t six

mon

ths

of 2

009,

ple

ase

refe

r tot

he c

onso

lidat

ed in

terim

Fin

anci

al S

tate

men

t for

the

six

mon

th p

erio

d en

ding

on

June

30,

200

9 fo

r inc

lusi

on in

the

Offe

ring

Circ

ular

dra

fted

for t

he li

stin

g of

ord

inar

y sh

ares

of Y

OO

X S

pA o

n th

e M

erca

to T

elem

atic

o (th

e Ita

lian

scre

en-b

ased

trad

ing

syst

em) o

rgan

ised

and

man

aged

by

Bor

sa It

alia

na S

.p.A

. 24

The

am

ount

of €

54,5

42 th

ousa

nd a

t Dec

embe

r 31,

200

9 al

so in

clud

es €

417

thou

sand

of r

eser

ve fo

r fut

ure

incr

ease

s in

sha

re c

apita

l. Th

e on

ly s

hare

pre

miu

m re

serv

e at

Dec

embe

r 31,

200

9 am

ount

ed to

€54

,127

.

YOOX GROUP


YOOX GROUP


Consolidated statement of cash flows Thousand euro Notes Jun 30, 2010 Jun 30, 2009 Consolidated profit for the period 9.30 3,339 1,562 Adjustments for: Taxes for the period 9.30 2,273 1,015 Financial expenses 9.31 538 1,053 Financial income 9.31 (843) (336) Depreciation, amortization and impairment losses 9.31 1,526 889 Fair value measurement of stock options 9.31 1,319 272 Unrealised effect of changes in foreign exchange rates 9.31 525 (91) (Gains)/losses on sale of non-current assets 9.31 - - Employee benefits 9.31 19 4 Provisions for risks and charges 9.31 369 420 Payment of employee benefits 9.31 (30) (53) Use of the provisions for risks and charges 9.31 (245) (168) Changes in inventories 9.32 (11,471) (4,806) Changes in trade receivables 9.32 1,040 1,101 Changes in trade payables 9.32 7,273 5,518 Changes in other current assets and liabilities 9.33 (4,905) 793 Cash flow from (used in) operating activities 727 7,173 Income tax paid 9.30 (5,838) (761) Interest and other financial expenses paid 9.31 (538) (1,283) Interest and other financial income received 9.31 843 336 NET CASH FLOW FROM (USED IN) OPERATING ACTIVITIES (4,806) 5,465 Investing activities Acquisition of property, plant and equipment 9.34 (730) (220) Acquisition of intangible assets 9.35 (2,841) (1,138) Acquisition of other non-current financial assets 9.36 (99) - Proceeds from sale of other non-current financial assets 9.36 - 774 Proceeds from sale of property, plant and equipment 9.34 - 4 NET CASH FLOW FROM (USED IN) INVESTING ACTIVITIES (3,670) (580) Financing activities New short-term financial liabilities

9.39 - - Repayment of short-term financial liabilities 9.39 (3) (3,932) New non-current financial liabilities 9.38 - - Repayment of non-current financial liabilities 9.38 (78) (2,762) Increase in share capital and share premium reserve 9.37 92 5,428 Investments in financial assets 9.40 (14,588) - NET CASH FLOW FROM (USED IN) FINANCING ACTIVITIES (14,577) (1,266) TOTAL CASH FLOW FOR THE PERIOD (23,052) 3,619 Cash and cash equivalents at the beginning of the period 9.20 35,007 8,962 Cash and cash equivalents at the end of the period 9.20 11,955 12,581 TOTAL CASH FLOW FOR THE PERIOD (23,052) 3,619

YOOX GROUP


1. General information The YOOX Group (hereinafter the Group or YOOX) began its activity with the opening, in the year 2000, of the Multi-brand yoox.com virtual boutique (initially operational in Italy and other countries of the European Union) for the sale of clothing, footwear and fashion accessories from collections of the corresponding season of the previous year at reduced prices, and other exclusive products (made exclusively for yoox.com) or that are otherwise difficult to find on the traditional and/or online market. In 2002, in order to grow its business by increasing its international presence, YOOX set up YOOX Corporation to manage sales on the US territory. In 2004, the YOOX Group expanded through the creation of YOOX Japan, to manage sales on the Japanese territory. Since 2006, based on the expertise it has developed and the success it has achieved with yoox.com, the YOOX Group has extended its operations through a new business line dedicated to the design and management of mono-brand Online Stores for some of the world’s leading fashion companies (the Mono-brand business line). On June 27, 2007, it established Y Services, a company wholly owned by YOOX S.p.A. (hereinafter the Company, the Parent Company), in order to ensure efficient management of the US sales made by the Online Stores of some of its Strategic Partners. In the first half of 2008, the YOOX Group also launched the multi-brand virtual space, “thecorner.com”, containing a selection of shops-in-shop, each dedicated to an individual brand with relatively limited distribution (thecorner.com and yoox.com together comprise the multi-brand business line). At the date of this consolidated interim financial statement, through multi-brand and mono-brand Online Stores, the YOOX Group sells a wide range of fashion and design products of established, niche and emerging brands in 67 countries, through three logistics centres in three different continents and six operational offices (located in Bologna, Milan, Paris, Madrid, New York and Tokyo), managing Online Stores in 7 languages and operating with 4 different currencies. Specifically, as of the date of this report, the YOOX Group has launched a total of 20 Online Stores, including 3 in 2006/2007, 7 in 2008, 6 in 2009 and 4 in early 2010. Group structure and activities The YOOX Group includes, as well as the Parent YOOX S.p.A., the companies YOOX Corporation and Y Services, which are subject to US law and manage sales activities in the US, and YOOX Japan, which is subject to Japanese law and manages sales activities in Japan. The YOOX Group is active in electronic commerce and offers commercial services relating to clothing and fashion accessories, and more generally to anything that accessorises the person or the home, during free time and when relaxing. 2. Statement of compliance with IAS/IFRS and general criteria used to prepare the condensed interim

financial statements These condensed consolidated interim financial statements, compiled in accordance with IAS 34 – Interim financial statements, were prepared using the same accounting standards as were used to prepare the consolidated financial statements at December 31, 2009, please refer to it for further details. Comparative data is reported in presenting the statement of financial position and the statement of cash flow in addition to the requirements of IAS 34 (December 31, 2009 for the statement of financial position and June 30, 2009 for the income statement, the statement of comprehensive income, the statement of changes in equity and the statement of cash flows). The figures for the first quarter of 2010 and the first half year of 2009 are reported in presenting the income statement, the Group having adopted the half year as the intermediate reference period. This condensed consolidated interim financial statement has been compiled in accordance with IASB (International Accounting Standards Board) IFRS (International Financial Reporting Standards) and are endorsed by the European Union. “IFRS” also refers to the International Accounting Standards (“IAS”) currently in force, in addition to all the interpretation documents issued by the International Financial Reporting Interpretations Committee (“IFRIC”) previously known as the Standing Interpretations Committee (“SIC”). These condensed interim financial statements, written in application of IAS 34 and in compliance with the provisions of Art. 54-ter of Decree Law 58 of February 24, 1998, (Consolidated Law on Finance) and as amended, do not contain all the information required for the annual financial statements and should be read in conjunction

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS AT JUNE 30, 2010

YOOX GROUP


with the consolidated financial statements at December 31, 2009. In particular, please note that the income statement, the statement of comprehensive income, the statement of financial position, the statement of changes in equity and the statement of cash flows were prepared in long form and were adopted for the consolidated financial statements at December 31, 2009. Conversely, the explanatory notes found below are in abridged form and therefore do not include all the information required for annual financial statements. In line with the requirements of IAS 34, in order to avoid duplicating information which has already been published, the notes refer only to those components of the income statement, the statement of comprehensive income, the statement of financial position, the statement of changes in equity and the statement of cash flows which, owing to their composition, amount, nature or infrequency, are essential for understanding the financial position, operations and assets of the Group. The condensed consolidated interim financial statements at June 30, 2010 consist of the income statement, statement of comprehensive income, statement of financial position, statement of changes in equity and statement of cash flows, in addition to these explanatory notes. In presenting these statements, comparative data has been presented as required by IAS 34 supplemented as noted above. 2.1 Consolidated financial statements In accordance with CONSOB Resolution 15519 of July 27, 2006 and Communication DEM6064293 of July 28, 2006 relating to financial statements, specific income statements, statements of financial position and statements of cash flows have been included showing significant relationships with related parties in order to improve readability. As indicated above, the consolidated financial statements at June 30, 2010 were drawn up in accordance with the IFRS endorsed by the European Union, and comprise the following: Income statement The income statement is classified by function, which is considered to provide more meaningful information than classification by nature since it is more consistent with the reporting system used by management when evaluating the performance of the business. Statement of comprehensive income The statement of comprehensive income presents, in a single statement, the components of profit (loss) for the period and income and expenses recognised directly in equity for transactions not involving owners of the Parent. Statement of financial position The statement of financial position presents current and non-current assets and current and non-current liabilities separately. For each item under assets and liabilities, a description is provided in the notes of the amounts expected to be settled or recovered within or after the 12-month period following the reporting date. Statement of changes in equity The statement of changes in equity reports the profit or loss for the year or the period, including each item of revenue or cost, income or expense which, as required by IAS/IFRS and their interpretations, is recognised directly in equity, and the total of these items; total comprehensive profit or loss for the year or period, with separate presentation of the portion pertaining to owners of the Parent and any portion pertaining to non-controlling interests; the effect on each item of equity of changes to accounting standards and corrections of errors as required by the accounting treatment set out in IAS 8; and the balance of profit or loss carried forward at the start of the period and at the date of the financial statements, together with the changes during the period. The notes to the condensed consolidated interim financial statements also present the amounts deriving from transactions with owners of the Parent and a reconciliation between the carrying amount of each share class, the share premium reserve and other reserves at the start and end of the year, showing each change separately. Statement of cash flows The statement of cash flows presents the cash flows from operating, investing and financing activities. Operating cash flows are presented using the indirect method, whereby profit or loss for the year or for the period is adjusted for non-monetary transactions, for all deferrals or provisions relating to previous or future operating receipts or payments and for revenue items relating to cash flows from investing or financing activities.

YOOX GROUP


3. Accounting standards and measurement criteria 3.1 Basis of preparation The condensed interim financial statements are presented in Euro and balances are expressed in thousands of Euro, unless specifically indicated otherwise. For reasons of clarity, it should be noted that variances in percentage terms and variations in the diverse items indicated have been calculated on precise values. It should also be noted that possible differences that may be found in some tables are due to rounding off amounts expressed in thousands of Euro. The consolidated interim financial statements were prepared on a historical cost basis, with the exception of derivative financial instruments and for financial instruments classified as available for sale (low risk and short term - less than twelve months - monetary instruments), such as Repurchase Agreements, which are measured at fair value and on the assumption that the business is a going concern. Despite the difficult macroeconomic environment in which it is operating, the Group believes that there are no significant uncertainties over business continuity (as defined under IAS 1.25), particularly given the strength of the Group’s financial situation. The accounting standards adopted in the consolidated financial statements and notes at June 30, 2010 were applied in the same way for all periods presented, for purposes of comparison. The accounting policies are applied in the same way across all Group companies. There are no held-to-maturity financial assets. Financial transactions are recognised according to the trade date. The accounting standards used to prepare the condensed consolidated financial statements, as well as the recognition and measurement criteria and the consolidation principles applied, comply with those adopted for the consolidated financial statements at December 31, 2009. 3.2 Use of estimates In order to prepare the consolidated interim financial statements, the management is required to use estimates and assumptions which affect the carrying amounts of assets and liabilities reported in the financial statements and the information regarding contingent assets and liabilities at the reporting date for the condensed consolidated interim financial statements. If, in the future, these estimates and assumptions, which are based on the management’s best evaluation, should differ, they will be altered appropriately during the period in which the circumstances change and the effects of any changes will be immediately recognised in the income statement. For a more detailed description of the most important evaluation methods used for the Group, refer to the chapter on the consolidated financial statement at December 31, 2009. It should also be pointed out that these evaluation processes, especially the more complex ones, such as determining any losses for non current assets, are usually only conducted in full during the compiling of the annual financial statement, when all the required information is available, except in cases where there are impairment indicators that require an immediate evaluation of any losses. 4. Approval of the interim financial statements at June 30, 2010 The consolidated interim financial statement at June 30, 2010 was approved by the Board of Directors on August 5, 2010. 5. Scope of consolidation The scope of consolidation at June 30, 2010 comprises the following subsidiaries of YOOX S.p.A.: • YOOX Corporation, formed in 2002 to manage sales activities in the US • YOOX Japan, formed in 2004 to manage sales activities in Japan; • Y Services, formed in 2007 to manage the US sales of the Online Stores for the following brands: Diesel, Miss

Sixty, Energie, Marni and D&G

YOOX GROUP


At June 30, 2010 the scope of consolidation included the following companies:

Company Registered offices Share capital at Jun 30, 2010

Percentage held at Jun 30, 2010

YOOX Via Nannetti,1– 40069 Zola Predosa – Bologna, Italy 511 -

YOOX Corporation 122 Hudson Street, New York 10013 NY, United States of America 248 100%

Y Services 125 Delawanna Avenue, Clifton NJ 07014, United States of America 124 100%

YOOX Japan Grande Maison Daikanyama No. 1001 150 0022 Shibuya-ku, Tokyo, Japan 75 100%

The scope of consolidation is unchanged from December 31, 2009 and June 30, 2009. The exchange rates used for converting the financial statements and account balances into currencies other than the Euro at June 30, 2010, December 31, 2009 and June 30, 2009 are the following ones (source www.uic.it): Exchange rate at Jun 30, 2010 Average exchange rate for the half-year under review

USD 1.2271 1.3268

JPY 108.79 121.32

GBP 0.8175 0.8700 Exchange rate at Dec 31, 2009 Average exchange rate for 2009

USD 1.4406 1.3948

JPY 133.16 130.34

GBP 0.8881 0.8909 Exchange rate at Jun 30, 2009 Average exchange rate for the half-year under review

USD 1.4134 1.3328

JPY 135.51 127.27

GBP 0.8521 0.8939 The amounts in foreign currency are reported against the euro. 6. Changes to accounting standards, new accounting standards, changes to estimates and

reclassifications Accounting standards, amendments and interpretations that came into effect from January 1, 2010 but that are not relevant for the Group The following amendments, improvements and interpretations, which came into effect from January 1, 2010, govern circumstances and cases that do not exist in the Group at the time of these condensed consolidated interim financial statements, but which might affect the accounting of future transactions or agreements:

• IFRS 3 (Revised in 2008) – Business combinations: specifically, the updated version of IFRS 3 introduced significant modifications which, in the main, involve: the conduct of purchases for subsidiary companies; the right to evaluate any shares in profit appertaining to third parties purchased during a partial acquisition at fair value, the allocation of all costs connected with the business combination in the profit and loss account and the determination of the purchase date of the liabilities for payments subject to condition;

YOOX GROUP


• IAS 27 (2008) – consolidated and separate financial statements: the modifications to IAS 27 mainly involve accounting management of transactions or events that alter profit-sharing amounts in subsidiary companies and the allocation of losses for the subsidiary to third party shares of profits;

• Improvement to IFRS 5 – Non-current assets held for sale and discontinued operations; • Amendments to IAS 28 – Participation in connected organisations and IAS 31 – Participation in joint

ventures, resulting from the modifications made to IAS 27; • Improvements to IAS/IFRS (2009); • IFRIC 17 – Distribution of non-cash assets to members; • IFRIC 18 – Transfers of assets from customers; • Amendment to IAS 39 – Financial Instruments: recognition and measurement - Elements that qualify for

Cover. Accounting standards, amendments and interpretations not yet applicable and not adopted in advance by the Group On October 8, 2009, the IASB issued an amendment to IAS 32 – Financial Instruments: presentation: classification of Rights Issues to govern accounting for rights issues (rights, options or warrants) denominated in currencies other than the functional currency of the issuer. These rights were previously accounted for as liabilities relating to derivative financial instruments. However the amendment stipulates that, in certain circumstances, these rights are to be classified under equity, regardless of the currency in which the exercise price is denominated. The amendment is applicable with retroactive effect from January 1, 2011. Adoption of this amendment is not expected to have any significant effect on the Group’s financial statements. At November 4, 2009, the IASB issued a revised version of IAS 24 – Related party disclosures in a financial statement that simplifies the type of information required in the case of transactions with correlated parties. The standard applies from January 1, 2011. At the date of these condensed consolidated interim financial statements, the competent European Union bodies have not yet completed the process of endorsement necessary for its application. On November 12, 2009, the IASB published IFRS 9 – Financial Instruments, on the classification and measurement of financial assets applicable from January 1, 2013. This publication represents the first stage in a process designed to replace IAS 39 completely. The new standard uses a unique approach based on the model for managing financial assets and the contractual cash flow characteristics of the financial asset to determine the recognition method by replacing the various rules envisaged in IAS 39. The new standard also proposes a single method of identifying impairment losses for financial assets. At the date of these condensed consolidated interim financial statements, the competent European Union bodies have not yet completed the necessary endorsement process for its application. On November 26, 2009, the IASB issued a minor amendment to IFRIC 14 – Prepayment of a Minimum Funding Requirement, allowing companies making prepayments of minimum funding contributions to recognise these as an asset. The amendment applies from January 1, 2011. At the date of these condensed consolidated interim financial statements, the competent European Union bodies have not yet completed the necessary endorsement process for its application. On November 26, 2009, IFRIC issued the interpretation IFRIC 19 – Extinguishing Financial Liabilities with Equity, which provides guidelines for recognition of the extinguishing of a financial liability by issuing equity. The interpretation stipulates that if a business renegotiates the terms to extinguish a financial liability and its creditor agrees to extinguish it via the issue of shares in the business, the shares issued by the business become part of the price paid for the extinction of the financial liability and must be measured at fair value. The difference between the carrying amount of the financial liability extinguished and the initial value of the equity issued must be recognised in the income statement for the period. The interpretation applies from January 1, 2011. At the date of these condensed consolidated interim financial statements, the competent European Union bodies have not yet completed the necessary endorsement process for its application. At May 6, 2010, the IASB issued a collection of modifications to the IFRS (improvements) that will apply from January 1, 2011; the main ones are listed below:

• IFRS 3 (2008) – Business combinations: the amendment clarifies that third party profit-sharing components who do not have the right towards owners to receive a share proportional to the net assets of the parent company should be evaluated at the fair value or in accordance with the applicable accounting principles. Therefore, for example, a stock option plan granted to employees should be evaluated, in the

YOOX GROUP


case of a business combination, in compliance with the rules of IFRS 2 and the equity share of a convertible bond should also be evaluated in compliance with IAS 32. In addition, the Board has taken a detailed look at the subject of share-based payment plans which have been replaced in a business combination context and have added a dedicated guide in order to clarify the accounting management.

• IAS 7 – Financial Instruments: Disclosures the modification stresses the interaction between additional

information of a qualitative nature and that of a quantitative nature required by the principle concerning the nature and extent of the inherent risks of the financial instruments. This should help those using the financial statements to tie up the information presented and create a general description surrounding the nature and extent of the risks stemming from these financial instruments. In addition, the request for information concerning financial assets that have expired but been renegotiated or devalued has been dispensed with plus that relating to the fair value of collateral.

• IAS 1 – Presentation of Financial Statements: the modification requires that the reconciliation of the

variations for each component of the equity be presented in the notes or in the balance sheets. • IAS 27 (2008) – The modifications to IAS 27 mainly involve the accounting management of transactions or

events that modify the profit-sharing rates in subsidiary companies and the allocation of the losses of the parent company to the attributable third party profit-shares.

• IAS 34 – Interim financial reporting: clarification surrounding the additional information that should be

presented in the Interim Financial Reporting has been provided by means of several examples. At the date of these condensed consolidated interim financial statements, the competent European Union bodies have not yet completed the necessary endorsement process for the application of the improvements that have just been described. 7. Segment reporting (business lines) The Group’s operating segments were determined on the basis of the reporting information used by senior management when making strategic decisions. This reporting information, which also reflects the Group’s current organisational structure, is based on the various products and services provided and was produced using the accounting standards described above (IFRS). The operating segments generate revenues from the specific production and sales activities described below: 1. Multi-brand, comprising the multi-brand online store activities of yoox.com and thecorner.com.

a) As an Online Store, yoox.com has been operational since June 2000, and at June 30, 2010 sells and distributes a vast array of fashion and designer products in 67 countries. The majority of products offered on yoox.com are clothing, footwear and fashion accessories drawn from the collections of well-known brands for the corresponding season of the previous year at reduced prices. To complete its select offerings, yoox.com offers collections made exclusively for sale through yoox.com from leading designers, as well as vintage items, special editions from on-trend designers and an original selection of design objects.

b) thecorner.com is an Online Store launched in February 2008 to market the current season’s collections of established brands and exclusive and/or handcrafted brands, characterised by relatively limited distribution, and most of which are being made available online for the first time. The products sold on thecorner.com have prices in line with those for the same clothing and accessories found in traditional retail outlets. Initially, thecorner.com only offered men’s collections. In September 2009, the women’s collection was also launched.

2. Mono-brand, comprising the design, creation and management, on an exclusive basis, of the Online Stores of

some of the leading global fashion brands. The Group is therefore the strategic partner for these brands in this specific sales channel. The goods available in the Online Stores are sold and invoiced directly to end customers by YOOX. At June 30, 2010 there were 20 Online Stores for the mono-brand business in operation.

The Group also has a Corporate and Central Services Area that directs and coordinates the Group’s activities. This Area also plays a key role in facilitating the operational integration of the various Areas and in supporting the activities directly associated with the operating segments. This Area includes Group management and the

YOOX GROUP


administrative, finance and control, legal, general services, human resources, press office, technology, investor relations and internal audit functions. The Group evaluates the performance of its operating segments according to their operating results, these being the results generated by ordinary operations. The segment revenues shown are those directly generated by or attributable to the segment and derive from its core activity. They include solely the revenue earned from transactions with third parties, since no revenue is generated from transactions with other segments. Segment costs comprise the direct costs charged by third parties in relation to the operating activities of the segment or directly attributable to the segment. The operational reporting system used by senior management to evaluate business performance does not envisage the allocation of amortization, depreciation and non-monetary income and expenses to the operating segments, and the information presented here is consistent with this reporting system. General expenses and other non-recurring income and expenses, financial income and expenses and taxes incurred in Group operations remain the responsibility of the Corporate Area since they are not related to the operations of the segments, and are posted under “Corporate”. All the income components presented are measured using the same accounting criteria as those adopted to prepare the Group’s consolidated financial statements. Income statement figures for each operating segment at June 30, 2010, with a reconciliation of entries with the Group’s income statement, is presented below: Description Multi-brand Mono-brand Corporate Group total June 2010 June 2009 June 2010 June 2009 June 2010 June 2009 June 2010 June 2009 Segment net revenues 73,831 56,982 22,723 11,323 96,554 68,305

Segment operating profit 11,857 9,264 3,839 1,172 15,696 10,436

Reconciliation with Group results: General expenses (9,916) (6,344) (9,916) (6,344) Other depreciation and amortization not attributable to operating segments (232) (175) (232) (175)

Other income and expenses (240) (624) (240) (624)

Non-recurring expenses - - - -

Other items

Group operating profit/(loss) 11,857 9,264 3,839 1,172 (10,388) (7,143) 5,308 3,293

Financial income 843 337 843 337

Financial expenses (539) (1.053) (539) (1,053)

Profit before tax 5,612 2,577

Tax (2,273) (1,015) (2,273) (1,015)

Profit for the year 3,339 1,562

YOOX GROUP


8. Information by geographical area Revenues generated by the Group from transactions with third-party customers breaks down as follows: Description June 30, 2010 June 30, 2009

Italy 23,278 18,851

Europe (excluding Italy) 46,471 33,993

North America 18,918 10,180

Japan 6,095 4,035

Other countries 658 364

Not country-related 1,134 882

Total 96,554 68,305 The item “Not country related” includes payments for setting up and maintaining the Online Stores, revenue generated from the sale of advertising projects for media partnership in the Multi-brand segment, revenue from web marketing and web design services in the Mono-brand segment, the services offered by Yagency and the revenues generated through alternative channels. The table showing revenues by geographical area is consistent with the Group control model, in which only sales to online customers are allocated by country. In the first half of 2010 and in 2009, revenue generated from transactions with the largest third-party customer did not exceed 10% of the Group’s total revenues. 9. Notes to the statement of financial position, income statement and statement of cash flows Income statement 9.1 Net revenues Total net revenues increased going from Euro 68,305 thousand in the first half of 2009 to Euro 96,554 thousand in the first half of 2010, an increase of 41.4%. Total net revenues from sales includes all revenues arising from the sale of goods, net of customer discounts and returns and revenues from the provision of services. The Group’s total net revenues at June 30, 2010 and at June 30, 2009 breaks down as follows: Description June 30, 2010 June 30, 2009 Change

Net revenues from sales 91,809 64,453 27,356Net revenues from the provision of services 4,745 3,852 893

Total 96,554 68,305 28,249 The marked rise in net revenues from sales in the first half of 2010 is mainly due to the upward trend in sales volumes. The growth in volumes is largely due to the rise in the number of orders and to the average order value (AOV). Net revenues from the sale of goods rose by 42.5% from Euro 64,453 thousand in the first half of 2009 to Euro 91,809 thousand in the first half of 2010. Revenues from the sale of goods is reported net of sales returns, amounting to Euro 33,251 thousand in the first half of 2010, or 26.6% of gross revenues for the first half of 2010 (revenues from the sale of goods before customer returns in the first half of 2010) and Euro 23,607 thousand in the first half of 2009, or 26.8% of gross revenues in the first half of 2009 (revenues from the sale of goods before customer returns in the first half of 2009). Returns are an inherent part of the Group’s business activities, as a result of the protection afforded to consumers under distance-selling – and specifically e-commerce – regulations in force in the countries where the Group operates. Net revenues from the provision of services rose by 23.2% from Euro 3,852 thousand in the first half of 2009 to Euro 4,745 thousand in the first half of 2010, mainly including: • the payment charged to the client for the transport service;

YOOX GROUP


• revenues from the set-up fees charged to create the Online Stores and fees charged to Strategic Partners in the Mono-brand business line for developing and maintaining the Online Stores;

• Revenue generated from the sale of media partnership projects in the multi-brand business line and the revenue from web marketing and web design services in Mono-brand.

For further details on the breakdown of revenues by geographical area and by operating segment, please see Note 7 Information by geographical area. 9.2 Cost of goods sold The cost of goods sold amounts to Euro 59,445 thousand (61.6% of net revenues) for the period ended June 30, 2010, compared with Euro 42,635 thousand (62.4% of net revenues) for the first half of 2009. The item includes costs deriving from the purchase of goods for sale, the cost of services and other costs. The following table shows a breakdown of the cost of goods sold by nature: Description June 30, 2010 June 30, 2009 Change

Change in inventories of goods 10,383 4,813 5,570Purchase of goods (61,190) (40,534) (20,656)Cost of services (8,091) (6,582) (1,509)Other costs (547) (332) (215)Total (59,445) (42,635) (16,810) The cost of goods purchased totalled Euro 40,534 thousand in the first half of 2009 compared with Euro 61,190 thousand in the first half of 2010. The cost of goods purchased includes costs for the procurement of goods for resale, the absolute value of which directly correlates to volumes sold. Service costs increased by 22.9%, from Euro 6,582 thousand in the first half of 2009 to Euro 8,091 thousand in the first half of 2010. This item includes transportation costs for sales and returns. A portion of the transportation costs is invoiced directly to the end customer and recognised as revenue from the provision of services. Other costs decreased by 64.8%, from Euro 332 thousand in the first half of 2009 to Euro 547 thousand in the first half of 2010. These costs mainly comprise transportation costs for purchases, and the internal personnel costs and external supplier costs incurred to set-up and maintain the websites of Mono-brand Strategic Partners. 9.3 Fulfillment costs Fulfillment costs came in at Euro 10,220 thousand (10.6% of net revenues) for the period ended June 30, 2010, compared with Euro 7,566 thousand (11.1% of net revenues) in the first six months of 2009, an increase of Euro 2,654 thousand. This cost comprises operational expenses incurred from digital production, cataloguing and quality control, from warehouse logistics, and from customer services, including call centre services and customer care. The following table shows the breakdown of fulfillment costs: Description June 30, 2010 June 30, 2009 Change

Cost of services (7,785) (5,441) (2,344)Personnel expenses (2,004) (1,824) (180)Depreciation and amortization (217) (162) (55)Other costs (214) (139) (75)

Total (10,220) (7,566) (2,654)

YOOX GROUP


Service costs increased by 43.1%, from Euro 5,441 thousand in the first half of 2009 to Euro 7,785 thousand in the first half of 2010. They mainly comprise service costs for handling and packaging goods and costs relating to outsourced production processes. Staffing costs have risen by 9.9% going from Euro 1,824 thousand in the first half of 2009 to Euro 2,004 thousand in the first half of 2010. This has been due both to the increase in the number of employees involved in this area, which has gone from 80 persons at June 30, 2009 to 92 persons at June 30, 2010, with 5 persons at June 30, 2009 based at offices abroad and 7 persons at June 30, 2010 and an increase in costs relating to Stock Option plans which went from Euro 27 thousand in the first half of 2009 to Euro 31 thousand in the first half of 2010. In addition to the cost of employees, personnel expenses also include the inherent costs of resources such as interns, contractors and consultants, since these are related to personnel expenses. 9.4 Sales and marketing costs The cost for business expenses came to Euro 11,425 thousand (11.8% of net revenues) for the half-year ending June 30, 2010 compared with Euro 7,843 thousand (11.5% of net revenues) for the half-year ending June 30, 2009, an increase of 45.7% These expenses relate to departments operating in sales. A portion of the costs are for personnel working in sales and marketing. The item also contains web marketing costs (including costs for online affiliation activities, i.e. sales commission paid to commercial intermediaries, and for consultancy services for the creation and development of advertising campaigns and procurement). Sales and marketing expenditure also includes costs for charges on credit card transactions and other methods of payment made to intermediaries for payment collection services, as well as expenses relating to customs duties levied on the import and export of goods sold. The following table shows the breakdown of sales and marketing costs: Description June 30, 2010 June 30, 2009 Change

Cost of services (6,965) (4,847) (2,118)Personnel expenses (3,550) (2,101) (1,449)Depreciation and amortization (15) (14) (1)Other costs (895) (881) (14)

Total (11,425) (7,843) (3,582) Service costs increased by 43.7%, from Euro 4,847 thousand in the first half of 2009 to Euro 6,965 thousand in the first half of 2010. The main components of service costs incurred in the first half of 2010 are mainly: • Web marketing costs of Euro 3,489 thousand (Euro 2,198 thousand in the first half of 2009). These costs

relate to the purchasing of online advertising, the negotiation and implementation of marketing agreements and the development of new partnerships and the commercial and technical management of existing partnerships, mainly for the Multi-brand business line.

• Costs incurred for commissions on credit card transactions and other related means of payment to intermediaries for payment collection services of Euro 1,645 thousand (Euro 1,128 thousand in the first half of 2009).

• import and export duties totalling Euro 1,408 thousand (Euro 935 thousand in the first half of 2009). Staffing costs showed an increase of 69.0% going from Euro 2,101 thousand in the first half of 2009 to Euro 3,550 thousand in the first half of 2010. This has been due both to the increase in the number of employees involved in this area, which has gone from 67 persons at June 30, 2009 to 108 persons at June 30, 2010, with 11 persons at June 30, 2009 based at offices abroad and 11 persons at June 30, 2010 and an increase in costs relating to Stock Option plans which went from Euro 77 thousand in the first half of 2009 to Euro 344 thousand in the first half of 2010. It should be pointed out that in addition to the cost of employees, the staffing costs also include resources such as interns, associates and consultants who come under personnel expenses. Other costs increased by 1.6% from Euro 881 thousand in the first half of 2009 to Euro 895 thousand in the first half of 2010. This item mainly comprises costs incurred for fraud relating to online sales, which decreased by 29.7%, from Euro 623 thousand in the first half of 2009 to Euro 438 thousand in the first half of 2010.

YOOX GROUP


9.5 General expenses General expenses include all the overhead costs of the Group’s various offices pertaining to personnel management, administration, finance and control, communications and image, general management, general services, investor relations, internal audit and technological services. General expenses were up 56.3% in the first half of 2010 at Euro 9,916 thousand, compared with Euro 6,344 thousand in the first half of 2009. General expenses can be broken down as follows: Description June 30, 2010 June 30, 2009 Change

Cost of services (4,255) (2,966) (1,289)Personnel expenses (4,368) (2,535) (1,833)Depreciation and amortization (1,294) (742) (552)Provisions - (101) 101

Total (9,916) (6,344) (3,572) The cost of services rose by 43.4% from Euro 2,966 thousand in the first half of 2009 to Euro 4,255 thousand in the first half of 2010. Staffing costs increased by 72.3% going from Euro 2,535 thousand in the first half of 2009 to Euro 4,368 thousand in the first half of 2010. This has been due both to the increase in the number of employees involved in this area, which has gone from 105 persons at June 30, 2009 to 134 persons at June 30, 2010, with 2 persons at June 30, 2009 based at offices abroad and 2 persons at June 30, 2010 and an increase in costs relating to Stock Option plans which went from Euro 168 thousand in the first half of 2009 to Euro 944 thousand in the first half of 2010. It should be noted that in addition to the cost of employees, the staffing costs also include resources such as interns, associates and consultants which come under personnel expenses. Depreciation and amortization increased by 74.4%, from Euro 742 thousand in the first half of 2009 to Euro 1,294 thousand in the first half of 2010. The provisions item, which refers to estimated losses relating to bad debts at the close of the first half of 2009, did not require any further provision in the first half of 2010. The bad debt provision in the financial statements at December 31, 2009 was consistent with June 30, 2010. 9.6 Other income and expenses Other income and expenses came to a total of Euro 240 thousand for the period ending at June 30, 2010 over Euro 624 thousand for the period ending June 30, 2009, a decrease of Euro 384 thousand. Other income and expenses can be broken down as follows: Description June 30, 2010 June 30, 2009 Change

Prior year expense (303) (424) 121Theft and losses (121) (229) 108Other tax charges (142) (90) (52)Other expenses (45) (60) 15Provisions for sundry risks (113) (165) 52Prior year income 457 216 241Reimbursements 29 124 (95)Other income - 4 (4)Total (240) (624) 384 Prior year expense increased by 28.5% from Euro 424 thousand in the first half of 2009 to Euro 303 thousand in the first half of 2010. Prior year expense includes expenses from routine management activities.

YOOX GROUP


Theft and losses relates to the theft and losses of goods destined for final customers that have already occurred at the closing date of the period. Other tax charges showed an increase of more than 57.8% going from Euro 90 thousand in the first half of 2009 to Euro 142 thousand in the first half of 2010. Provisions for sundry risks in the first half of 2010 relate to estimated charge incurred due to theft and loss of goods not identified as missing at year end. Prior year income increased by more than 100%, from Euro 216 thousand in the first half of 2009 to Euro 457 thousand in the first half of 2010. Prior year income includes income mainly derived from routine management activities. 9.7 Non-recurring expenses No non-recurring expenses were incurred in the first half of 2010 or the first half of 2009. 9.8 Operating profit As required by IAS 1, the following is a breakdown of costs by nature used to determine the operating margin. Description June 30, 2010 June 30, 2009 Change

Net revenues 96,554 68,305 28,249Changes in inventories 10,383 4,813 5,570Purchase of goods (61,190) (40,534) (20,656)Services (27,095) (19,836) (7,259)Personnel expenses (9,922) (6,460) (3,462)Depreciation, amortization and impairment losses (1,526) (1,019) (507)Other costs and revenues (1,896) (1,976) 80Total 5,308 3,293 2,015 Operating profit totalled Euro 3,293 thousand at June 30, 2009 and Euro 5,308 thousand at June 30, 2010, representing 4.8% of net revenues in the first half of 2009 and 5.5% in the first half of 2010. This significant increase was due to a recovery in profitability following a significant rise in volumes, resulting in better absorption of fixed costs. Personnel expenses include all employment related expenses, such as merit pay rises, promotions, cost-of-living adjustments, variable remuneration for the first half of 2010, unused leave and accruals to legal reserves required under collective agreement, as well as related social security contributions and the contributions to the post-employment benefits for Parent employees. These costs also include the fair value of stock options, between the allocation and vesting dates, with a direct matching entry in equity. It should be noted that in addition to the cost of employees, personnel expenses also include the inherent costs of resources such as interns, associates and consultants, which come under personnel expenses and the remuneration for the Group’s Chief Executive Officer. At June 30, 2010 the Group headcount showed a 33% increase compared with the same period for the previous year with a net increase of 82 resources. The table below shows a breakdown of the headcount at June 30, 2010 compared with that of June 30, 200925. No. June 30, 2010 June 30, 2009 ChangeManagers 16 13 3Junior managers 29 16 13Employees and Trainees 269 205 64Abroad 20 18 2Total headcount 334 252 82 The Group headcount at December 31, 2009 was 287, an increase of 16% with 47 resources. 25 The headcount does not include the Chief Executive Officer of Yoox S.p.A., interns or consultants.

YOOX GROUP


9.9 Financial income Financial income totalled Euro 337 thousand in the first half of 2009 and Euro 843 thousand in the first half of 2010. The following table shows the breakdown of financial income: Description June 30, 2010 June 30, 2009 Change

Exchange rate gains 713 259 454Other financial income 96 31 65Interest income on current account 33 47 (14)

Total 843 337 506 Exchange rate gains totalled Euro 259 thousand in the first half of 2009 and Euro 713 thousand in the first half of 2010. They mainly relate to the conversion of items to US dollars and Japanese yen and are closely connected to the ordinary sale and purchase of goods. Other financial income went from Euro 31 thousand in the first half of 2009 to Euro 96 thousand in the first half of 2010. The balance at June 30, 2010 is made of up rebates cashed from the sale of cash funds and deposit certificates opened and surrendered in the reference half-year period to the tune of Euro 12 thousand and from the fair value determination for Repurchase Agreements still in force as for June 30, 2010 for Euro 84 thousand. 9.10 Financial expenses Financial expenses totalled Euro 1,053 thousand in the first half of 2009 and Euro 539 thousand in the first half of 2010. The following table shows the breakdown of financial expenses: Description June 30, 2010 June 30, 2009 Change

Exchange rate losses (224) (457) 233Other financial expenses (233) (88) (145)Interest expenses (82) (508) 426

Total (539) (1.053) 514 Exchange rate losses totalled Euro 457 thousand in the first half of 2009 and Euro 224 thousand in the first half of 2010. They mainly relate to the conversion of items to US dollars and Japanese yen and are closely connected to the ordinary sale and purchase of goods. Other financial expenses went from Euro 88 thousand in the first half of 2009 to Euro 233 thousand in the first half of 2010; the balance at June 30, 2010 is mainly derived from the fair value of fixed term sales contracts in force at the time of this condensed consolidated interim financial statements amounting to Euro 103 thousand. Interest expense decreased by 83.8% from Euro 508 thousand in the first half of 2009 to Euro 82 thousand in the first half of 2010, This decrease was mainly due to the fact that borrowing rates are now lower than in the first half of 2009 and that the syndicated loan was fully repaid on December 15, 2009.

YOOX GROUP


9.11 Tax Income tax for the period can be broken down as follows: Description June 30, 2010 June 30, 2009 Change

Current corporate income tax - Parent (1) (848) (1.256) 408Current regional income tax - Parent (2) (461) (324) (137)Current income tax - foreign companies (1.439) (521) (918)Deferred taxes 475 1.086 (611)Total taxes (2,273) (1,015) (1,258) (1) IRES: Imposta sul Reddito delle Societa (Corporate or Company Tax) (2) IRAP: Imposta Regionale sulle Attivita Produttive (Regional Tax on Production Activities) The Group incurred a greater tax burden in absolute terms than at June 30, 2009. Current taxes rose from Euro 2,101 thousand to Euro 2,748 thousand. IRAP taxes rose 42% for the Parent, from Euro 324 thousand at June 30, 2009 to Euro 461 thousand at June 30, 2010. IRES taxes for the Parent are Euro 848 thousand. As regards corporate income tax (IRES), tax losses carried forward of Euro 223 thousand were fully used up in the first half of 2009. With respect to the period ending June 30, 2009, the Group’s foreign companies had a tax burden of about Euro 1,439 thousand, due entirely to higher taxable profits resulting from growth in operations during the period to June 30, 2010. The Group also allocated deferred tax assets totalling Euro 3,341 thousand and deferred tax liabilities of Euro 49 thousand. Deferred tax assets of Euro 2,844 thousand and deferred tax liabilities of Euro 26 thousand that were allocated in 2009 were also reversed. It should also be pointed out that the amount posted to the income statement does not include the Euro 403 thousand in deferred tax assets posted directly as a matching entry to the share premium reserve pursuant to IAS 32. In addition, Euro 537 thousand in deferred tax assets posted directly as a matching entry to the share premium reserve in 2009 was reversed. 9.12 Basic and diluted earnings per share The following table shows the calculation of the basic earnings per share (basic EPS) and diluted earnings per share (diluted EPS) reported in the consolidated income statement. Calculation of basic EPS June 30, 2010 June 30, 2009

Basic earnings 3,339 1,562

Average number of ordinary shares 50,947,893 41,430,376

Basic EPS 0.07 0.04 Calculation of diluted EPS June 30, 2010 June 30, 2009

Basic earnings 3,339 1,562

Average number of ordinary shares 50,947,893 41,430,376

Average number of shares granted without consideration 1,623,994 6,784,960

Total 52,571,887 42,215,336

Diluted EPS 0,06 0,03

YOOX GROUP


The average number of shares granted without consideration at June 30, 2010 and June 30, 2009 and used to calculate diluted EPS relates to the effect of granting shares under existing stock option plans which, as stated in IFRS 2, can be converted on the basis of vesting conditions in the respective years. The figures are those that apply following the YOOX S.p.A. share-split (please see also section 9.22 of these notes). Statement of financial position 9.13 Property, plant and equipment At June 30,2010, property, plant and equipment totalled Euro 4,060 thousand. The following is a summary of changes therein in the first half of 2010:

His

toric

al c

ost

Incr

ease

sD

ecre

ases

His

toric

al c

ost

Acc

. am

ortiz

atio

n

Am

ort.

Util

isat

ion

Acc

. am

ortiz

atio

n

Net

car

ryin

g am

ount

N

et c

arry

ing

amou

nt

Des

crip

tion

at D

ec 3

1, 2

009

at J

un 3

0, 2

010

at D

ec 3

1, 2

009

at J

un 3

0, 2

010

at D

ec 3

1, 2

009

at J

un 3

0, 2

010

Pl

ant a

nd e

quip

men

t 1,

599

18

6

- 1,

785

(7

73)

(126

) -

(899

) 82

6

886

Bui

ldin

gs

1,32

3

16

- 1,

339

(6

43)

(84)

-

(727

) 68

0

612

Le

aseh

old

impr

ovem

ents

1,

323

16

-

1,33

9

(643

) (8

4)

- (7

27)

680

61

2

-

-

Indu

stria

l & c

omm

erci

al e

quip

men

t 91

5

87

- 1,

002

(4

94)

(69)

-

(563

) 42

1

439

O

ther

ass

ets

3,

367

89

7

- 4,

264

(1

,786

) (3

54)

- (2

,140

) 1,

582

2,

124

Fu

rnitu

re a

nd fu

rnis

hing

s 67

4

64

- 73

8

(424

) (4

4)

- (4

68)

250

27

0

Ele

ctro

nic

equi

pmen

t 2,

579

81

6

- 3,

395

(1

,269

) (3

03)

- (1

,572

) 1,

310

1,

823

Ve

hicl

es

1

- -

1

(1)

- -

(1)

- -

Oth

er D

epr.

113

15

-

128

(9

2)

(7)

- (9

9)

21

29

Ass

ets

unde

r con

stru

ctio

n an

d pa

ymen

ts o

n ac

coun

t -

- -

- -

- -

- -

-

To

tal

7,20

5

1,18

4

- 8,

388

(3

,696

) (6

33)

- (4

,329

) 3,

508

4,

060

YOOX GROUP


YOOX GROUP


The total increase of Euro 1,184 thousand is mainly due to investment amounting to Euro 572 thousand in new servers, PCs and monitors held under finance leases, recorded under the “Other assets” category. The remaining Euro 325 thousand mainly relates to an investment of Euro 244 thousand in data storage and Euro 64 thousand in costs incurred by the Group chiefly to furnish the offices at the Bologna and Milan branches. The increase of Euro 186 thousand in plant and equipment mainly relates to the acquisition of new electrical equipment and optical readers used at the Bologna branches. The Euro 16 thousand increase in leasehold improvements is mainly due to permanent refurbishment work on the buildings leased for the branches at which the Group operates. Industrial and commercial equipment registered an increase of Euro 87 thousand during the period, mainly due to the purchase of photographic equipment for the Bologna Logistics Centre warehouse. Depreciation in the period totalled Euro 633 thousand. At June 30, 2010, there are no liens or encumbrances on the items of property, plant and equipment of the YOOX Group; neither are there any commitments to purchase them. Moreover, no impairment losses or revaluations were carried out on items of property, plant and equipment in the first half of 2010. nor were borrowing costs charged to assets entered in the statement of financial position. 9.14 Intangible assets with finite useful life Intangible assets amounted to Euro 5,368 thousand at June 30, 2010. The following is a summary of changes in intangible assets with finite useful life in the first half of 2010:

His

toric

al c

ost

Incr

ease

s D

ecre

ases

/ R

ecla

ssifi

ed

His

toric

al c

ost

Acc

. am

ortiz

atio

n

Am

ort.

Acc

. am

ortiz

atio

n N

et c

arry

ing

amou

nt

Net

car

ryin

g am

ount

Des

crip

tion

at D

ec 3

1, 2

009

at J

un 3

0, 2

010

at D

ec 3

1, 2

009

at

Jun

30,

201

0 at

Dec

31,

200

9 at

Jun

30,

201

0

Dev

elop

men

t cos

ts

3,97

4 -

378

4,35

2 (1

,371

) (6

81)

(2,0

52)

2,60

4 2,

300

Softw

are

and

licen

ces

2,03

9 49

5 -

2,53

4 (1

,868

) (1

35)

(2,0

03)

171

531

Bra

nds

and

othe

r rig

hts

141

- -

141

(75)

(7

) (8

2)

66

59

Trad

emar

ks a

nd p

aten

ts

141

- -

141

(75)

(7

) (8

2)

66

59

Ass

ets

unde

r dev

elop

men

t 32

1 2,

252

(378

) 2,

195

- -

- 32

1 2,

195

Oth

er

1,35

2 95

-

1,44

7 (1

,094

) (7

0)

(1,1

64)

258

283

Oth

er in

tang

ible

ass

ets

1,35

2 95

-

1,44

7 (1

,094

) (7

0)

(1,1

64)

258

283

Tota

l 7,

827

2,84

1 -

10,6

69

(4,4

08)

(893

) (5

,301

) 3,

420

5,36

8

The

prin

cipa

l cha

nges

in th

ese

item

s du

ring

the

perio

d ar

e de

scrib

ed b

elow

.

YOOX GROUP


YOOX GROUP


Development costs During the first half of 2010, the Group made substantial investments in development projects with long-term benefits totalling Euro 2,184 thousand (up Euro 2,252 thousand). Of this amount, Euro 36 thousand relates to projects completed and classified under “Development costs” and Euro 2,148 thousand relates to projects still in progress at June 30, 2010 and therefore classified under “Assets under development”. These are costs incurred by YOOX S.p.A. for specific projects aimed at the ongoing development of innovative solutions for the creation and management of Online Stores. The development projects have been classified according to the area in which the various initiatives are carried out: development of e-commerce functionality, development of tools to support productivity, security and performance. In line with the strategy defined at the end of 2009, over the course of the first half of 2010, the number of development projects at outside suppliers increased very substantially. The majority of these activities were aimed at management systems and process workflows in order to achieve a considerable improvement in internal productivity and the introduction of new functions that improve the presence of the Group websites in search engines and new experimental projects in the field of social networks. Expenses for research carried out with a view to obtaining new knowledge or making scientific or technical discoveries, are recognised in the income statement at the time they are incurred. Other investments in intangible assets refer mainly to software, licences and other Group intangible assets. Software and licences The increase of Euro 495 thousand in this item includes expenditure with long-term benefits, principally relating to the acquisition of software licences to build the infrastructure of the Online Stores. Brands and other rights This item has a carrying amount of Euro 59 thousand at June 30, 2010 and did not increase during the period under examination. It mainly comprises expenses incurred by the Company in acquiring and registering national and international trademarks. Other intangible assets The increase of Euro 95 thousand in this item mainly comprises costs for external consultancy for the development of Hyperion software to manage the consolidated financial statements. Depreciation in the period totalled Euro 893 thousand. 9.15 Deferred tax assets Description Jun 30, 2010 Dec 31, 2009 Change

Deferred tax assets 4,034 3,546 488

Total 4,034 3,546 488 Deferred tax assets rose by 13.8% from Euro 3,546 thousand at December 31, 2009 to Euro 4,034. thousand at June 30, 2010. Deferred tax assets at June 30, 2010 were recognised mainly in relation to: − provisions for obsolete inventories; − provisions for risks and charges (provisions for disputes, provisions for fraud and provisions for theft and loss,

respectively); − directors’ fees unpaid at June 30, 2010;

YOOX GROUP


− unissued and non-deductible credit notes; − unrealised exchange rate losses; Euro 2,844 thousand in deferred tax assets recognised in 2009 were also reversed. The amount posted to the income statement does not include the Euro 403 thousand in deferred tax assets posted directly as a matching entry to the share premium reserve pursuant to IAS 32. In addition, Euro 537 thousand in deferred tax assets posted directly as a matching entry to the share premium reserve in 2009 was reversed. Deferred tax assets posted to allowances for impairment, provisions for obsolete inventories and provisions for risks and charges also include the amount relating to the provisions recorded by the Group’s foreign companies. 9.16 Other non-current financial assets Other non-current financial assets totalled Euro 508 thousand at June 30, 2010 (Euro 409 thousand at December 31, 2009). These largely relate to rental contracts and contracts for the supply of electricity and gas, and to the existing relationships with Paymentech relating to retentions to guarantee the repayments due for returns made against sales. 9.17 Inventories Description Jun 30, 2010 Dec 31, 2009 Change

Inventories 58,525 47,054 11,471

Total 58,525 47,054 11,471 Inventories at June 30, 2010 and December 31, 2009 break down as follows: Description Jun 30, 2010 Dec 31, 2009 Change

Inventories of raw materials, consumables andsupplies 445 240 205

Total 445 240 205

Finished products and goods 63,423 51,075 12,348Provision for obsolete finished products and goods (5,343) (4,261) (1,082)

Total 58,080 46,814 11,266

Total net inventories 58,525 47,054 11,471 Inventories rose by 24.4% from Euro 47,054 thousand at December 31, 2009 to Euro 58,525 thousand at June 30, 2010 and relate to goods that have been purchased for subsequent resale online. The increase is inherently only partly the result of growth in volumes during the first half of 2010. The Group’s business model involves purchasing goods in advance, before the selling season. At June 30, 2010, 83.2% of the carrying amount of goods inventories, including the provision for obsolete inventories, consists of goods already for sale and goods purchased for sale in subsequent months. Goods from previous collections and/or obsolete goods are written down with a provision for obsolete finished products and goods, calculated using the estimated realisable value of the goods.

YOOX GROUP


The amount and the changes in the provision for obsolete finished products and goods in the first half of 2010 is set out in the following table:

Description Dec 31, 2009 Increases DecreasesExchange rate effect from consolidation Jun 30, 2010

Provision for obsolete finished products and goods 4,261 915 - 167 4,261Total 4,261 915 - 167 4,261 The reserve for obsolete finished products and goods has a carrying amount deemed appropriate for the actual quantities of obsolete or slow-moving goods on hand. 9.18 Trade receivables The breakdown of trade receivables at June 30, 2010 is as follows: Description Jun 30, 2010 Dec 31, 2009 Change

Due from customer 3,909 3,396 513

Other trade receivables 2,043 3,518 (1,475)

Services in progress - 51 (51)

Allowance for impairment (249) (222) (27)

Total 5,703 6,743 (1,040) The receivables due from customers are fully recoverable within 12 months and relate to trade receivables for the sale of goods to individuals. Other trade receivables mainly relate to receivables from Online Stores, chiefly for the provision of services. Services in progress of Euro 51 thousand refer to set-up fees paid to the Group by Strategic Partners for whom the Group designs and creates Online Stores. They are measured according to fees accrued in the period based on the stage of service completion. In the first half of 2010, the contracts to which these receivables relate were completed and the associated revenues were fully realised. The allowance for impairment covers specific risks relating to unpaid receivables and other receivables not considered recoverable. Provisions made during the period adjust the receivables to their estimated realisable value. In this regard, it should be noted that the increase in the first half of 2010 is not attributable to provisions of this kind, but exclusively resulting from an exchange rate effect from consolidation. 9.19 Other current assets Description Jun 30, 2010 Dec 31, 2009 Change

Other current assets 4,409 3,213 1,196

Total 4,409 3,213 1,196

YOOX GROUP


The following is a breakdown of other current assets at June 30, 2010: Description Jun 30, 2010 Dec 31, 2009 Change

Other receivables 2,115 1,011 1,104

Allowance for impairment – receivables from others (221) (221) -

Advances to suppliers 47 3 44

Travel and payroll advances to employees 3 - 3

Due from acquirers 1,311 1,197 114

Prepayments 950 548 402

Tax receivables 187 659 (472)

Hedging derivatives 16 16 -

Total 4,409 3,213 1,196 The sundry receivables item includes Euro 216 thousand in receivables for sums paid to the Parent’s tax representative in Greece and fully written down. Furthermore, at December 31, 2009 this item included:

− Euro 462 thousand in receivables from credit notes received from suppliers but not encashed at December 31, 2009 and which were nearly all encashed in January 2010;

− Euro 257 thousand in receivables from a director who expressed a wish to exercise stock options, but who

had not paid the corresponding sum at December 31, 2009. For this individual the corresponding payable, including the related withholding tax, is posted to “Other payables”; payment was made in full in January 2010.

The allowance for impairment – receivables from others, as previously mentioned, relates to the loan to the Greek tax representative, which is deemed unrecoverable. The item “Due from acquirers” reflects customer payments already collected by Italian and foreign acquirers but not yet paid over to the Group at June 30, 2010. The “Prepayments” item mainly comprises costs relating to future periods but incurred in the first half of 2010. It mainly includes software licence fees, insurance costs and rental costs. Tax receivables, mainly consist of deductions from royalties invoiced by the Parent to foreign subsidiary companies. These amounting include deductions that the subsidiary companies pay the US and Japanese revenues withholding the same amount from the payment of the Parent. The Parent, in turn, makes good this overall amount with regard to the Italian revenues. 9.20 Cash and cash equivalents and financial current assets The breakdown of the item “Cash and cash equivalents” at June 30, 2010 is as follows: Description Jun 30, 2010 Dec 31, 2009 Change

Bank and postal accounts 11,946 34,997 (23,051)

Cash and cash equivalents on hand 9 10 (1)

Total Cash and cash equivalents 11,955 35,007 (23,052)

YOOX GROUP


The following is a breakdown of current financial assets at June 30, 2010: Description Jun 30, 2010 Dec 31, 2009 Change

Banca Pop. di Novara (securities account) 14,504 - 14,504

Fair value adjustment of current financial assets 84 - 84

Total current financial assets 14,588 - 14,588 Cash and cash equivalents totalled Euro 11,955 thousand at June 30, 2010, and are made up of cash, negotiable instruments and demand deposits or short-term deposits with banks, which are actually available and readily usable. Other current financial assets, equal to Euro 14,588 thousand, refer to Repurchase Agreements with a low risk profile and short term (less than twelve months) agreed with major national Credit Institutions with a high credit rating. Investment in these financial assets is one of the reasons for the reduction in cash between December 31, 2009 and June 30, 2010. As reported in paragraph 3.1 entitled “general drafting criteria”, the financial assets held by the Group at June 30, 2010 and classified as “available for sale”, i.e. financial assets held with the aim of achieving a profit in the short term, are measured at fair value at the end of every reporting period. Any gains or losses resulting from a change in fair value are posted to the income statement. 9.21 Equity attributable to equity holders of the Parent The breakdown of changes in equity at June 30, 2010 is presented in a separate table. The share capital of Euro 511 thousand at June 30, 2010 (Euro 504 thousand at December 31, 2009) increased over the course of the first half of 2010 following the exercise of the Stock Option on the part of the beneficiaries in question. In this regard it should be noted that the Board of Directors on January 18, 2010 assigned 564,200 ordinary shares in favour of several beneficiaries of 10,850 options derived from several Stock Option plans and that on May 11, 2010 the Board of Directors assigned 119,600 ordinary shares in favour of a beneficiary of 2,300 options deriving from a Stock Option plan, with an overall effect equal to Euro 7 thousand. The reserves consist of the following:

- the share premium reserve was Euro 54,628 thousand at June 30, 2010 (Euro 54,127 thousand at December 31, 2009); this reserve increased over the course of the first half of 2010 following the exercise of the Stock Option on the part of the beneficiaries in question. In this regard it should be noted that the Board of Directors on January 18, 2010 assigned 564,200 ordinary shares in favour of several beneficiaries of 10,850 options derived from several Stock Option plans and that on May 11, 2010 the Board of Directors assigned 119,600 ordinary shares in favour of a beneficiary of 2,300 options deriving from a Stock Option plan, with an overall effect equal to Euro 635 thousand. The increase in the share premium reserve was recognised net of Euro 134 thousand in deferred tax assets accrued in 2009 and since released pursuant to IAS 32; net of prepaid taxes this amounted to Euro 501 thousand;

- legal reserve, which totalled Euro 193 thousand at June 30, 2010 (Euro 193 thousand at December 31,

2009), consists of accruals of 5% of Parent profits every year. This reserve did not increase in the first half of 2010 since it had reached the limit imposed by Article 2430 of the Italian Civil Code at December 31, 2009;

- translation reserve, which had a balance of Euro 498 thousand at June 30, 2010 (compared with a

negative balance of Euro 27 thousand at December 31, 2009), reflects exchange rate differences arising from the translation of financial statements denominated in foreign currency. In the first half of 2010, this reserve increased by Euro 525 thousand;

- reserve for future increases in share capital and share premium reserve, which amounted to Euro 0

thousand at June 30, 2010 (Euro 417 thousand at December 31, 2009), includes liabilities to individuals who had paid to exercise stock options at December 31, 2009, but to whom the Company had not made the corresponding ordinary shares available by the end of the year;

YOOX GROUP


- other reserves, equal to Euro 5,549 thousand at June 30, 2010 (Euro 4,229 thousand at December 31, 2009) only include the reserve for evaluation of the Stock Option at fair value.

- retained earnings (losses carried forward) amount to a loss carried forward of Euro 5,365 thousand at

June 30, 2010 (Euro 9,462 thousand at December 31, 2009), down by Euro 4,098 thousand due to the allocation of profit for 2009.

9.22 Stock option plans and company incentive plans Granting of stock options Following approval of the share-split at the Extraordinary Shareholders’ Meeting of the Parent on 8 September 2009, beneficiaries of stock option plans exercising their options will be entitled to 52 ordinary shares of the Company for every option exercised. With reference to the stock option plans and company incentive plans involving a total of 16,914,664 shares reserved for employees, associates, consultants and directors of the Company and its subsidiaries, at June 30, 2010 the Board of Directors had granted the following options, outlined in the table below:

Stock option plans Granted (a) Expired (b) Exercised (c)

Total granted,not expired or not exercised

(d = a-b-c)

Granted, not vested

Granted, vested, not exercisable

Granted, vested and exercisable

2001 – 2003 80,575 31,560 32,924 16,091 11,341 250 4,500

2003 – 2005 36,760 3,000 10,747 23,013 22,513 500 -

2004 – 2006 32,319 12,650 4,938 14,731 13,731 1,000 -

2006 – 2008 31,303 200 2,400 28,703 14,703 14,000 -

2007 – 2012 102,600 3,650 772 98,178 77,612 20,566 -

2009 – 2014 46,167 - - 46,167 46,167 - -

Total 329,724 51,060 51,781 226,883 186,067 36,316 4,500

At June 30, 2010, 40,618 options may be granted under the above plans. The table below shows the exact prices for the options assigned that have not expired or been exercised at June 30, 2010. However, it does not include the Stock Option assigned on July 1, 2010. Exercise prices26

€ 15.91 € 46.48 € 59.17 € 106.50 € 131.78 € 277.68 Option total Share total

2001 – 2003 1,500 5,091 0 9,500 0 0 16,091 836,732

2003 – 2005 0 20,673 0 2,340 0 0 23,013 1,196,676

2004 – 2006 0 10,531 0 2,500 1,700 0 14,731 766,012

2006 – 2008 0 0 28,703 0 0 0 28,703 1,492,556

2007 – 2012 0 0 91,228 6,950 0 0 98,178 5,105,256

2009 – 2014 0 0 0 0 0 46,167 46,167 2,400,684

Total 1,500 36,295 119,931 21,290 1,700 46,167 226,883 11,797,916

26 The price indicated in the table is the exercise price for the options. It should be specified, that to deduce the exercise price of a single share it is necessary to

divide by 52 when, as specified above, as a result of the decision on the share-split adopted by the Extraordinary Shareholders’ Meeting of the Parent Company on September 8, 2009, those persons who have stock options under the plan exercise their relative option rights; they will have the right to obtain 52 ordinary company shares for all option rights exercised.

YOOX GROUP


On March 11, 2010, the Board of Directors of the Parent approved the regulations for the 2009-2014 Stock Option Plan and granted 46,167 stock options for the subscription of 2,400,684 shares at a subscription price per share of Euro 5.34, which is calculated by taking the weighted average of the prices recorded by the shares on the Mercato Telematico Azionario (MTA), the Italian screen-based trading system organised and managed by Borsa Italiana S.p.A., during the 30 (thirty) trading days prior to the Grant Date. Share capital increases to service stock option and company incentive plans At a meeting on January 31, 2005, the Board of Directors took full advantage of the powers conferred by the Extraordinary Shareholders’ Meeting of March 22, 2000 and subsequent amendments, pursuant to Article 2443 of the Italian Civil Code, increasing the share capital to service the stock option plan via the issue of up to 1,116,076 shares with an implicit unit price of Euro 0.01, a premium of Euro 0.2960 on each new share and standard dividend rights. Pursuant to Article 2439, paragraph 2 of the Italian Civil Code, the deadline for subscription was set at January 31, 2015, with the provision that, if the share capital increase is not fully subscribed by this date, the share capital shall be deemed to have been increased by an amount equal to the subscriptions received. At the same meeting on January 31, 2005, the Board of Directors also took full advantage of the powers conferred by the Extraordinary Shareholders’ Meeting of July 31, 2000 and subsequent amendments, pursuant to Article 2443 of the Italian Civil Code, increasing the share capital to service the stock option plan via the issue of up to 1,483,924 new shares with an implicit unit price of Euro 0.01, a premium of Euro 0.8839 on each new share and standard dividend rights. Pursuant to Article 2439, paragraph 2 of the Italian Civil Code, the deadline for subscription was set at January 31, 2015, with the provision that, if the share capital increase is not fully subscribed by this date, the share capital shall be deemed to have been increased by an amount equal to the subscriptions received. At a meeting on July 12, 2007, the Board of Directors took full advantage of the powers conferred by the Extraordinary Shareholders’ Meeting of July 18, 2002 and subsequently amended by resolution of the Extraordinary Shareholders’ Meeting of December 2, 2005, pursuant to Article 2443 of the Italian Civil Code, increasing the share capital to service the stock option plan via the issue of up to 1,755,520 new shares with an implicit unit price of Euro 0.01, a premium of Euro 0.8839 on each new share and standard dividend rights, reserved for the Company’s employees and directors. Pursuant to Article 2439, paragraph 2 of the Italian Civil Code, the deadline for subscription was set at July 31, 2017, with the provision that, if the share capital increase is not fully subscribed by this date, the share capital shall be deemed to have been increased by an amount equal to the subscriptions received. At a meeting on December 1, 2008, the Board of Directors took full advantage of the powers conferred by the Extraordinary Shareholders’ Meeting of December 10, 2003 and subsequently amended by resolution of the Extraordinary Shareholders’ Meeting of December 2, 2005, pursuant to Article 2443 of the Italian Civil Code, increasing the share capital to service the stock option plan via the issue of up to 1,022,788 new shares with an implicit unit price of Euro 0.01, a premium of Euro 0.8839 on each new share and standard dividend rights, reserved for the Company’s employees and directors. Pursuant to Article 2439, paragraph 2 of the Italian Civil Code, the deadline for subscription was set at December 1, 2018, with the provision that, if the share capital increase is not fully subscribed by this date, the share capital shall be deemed to have been increased by an amount equal to the subscriptions received. At a meeting on September 3, 2009, the Board of Directors took full advantage of the powers conferred by the Extraordinary Shareholders’ Meeting of December 2, 2005 and subsequently amended by resolution of the Extraordinary Shareholders’ Meeting of July 12, 2007, pursuant to Article 2443 of the Italian Civil Code, increasing the share capital to service the stock option plan via the issue of up to 1,627,756 new shares with an implicit unit price of Euro 0.01, a premium of Euro 1.1279 on each new share and the same dividend rights as the other shares outstanding at the time of their subscription. Pursuant to Article 2439, paragraph 2 of the Italian Civil Code, the deadline for subscription was set at September 3, 2019, with the provision that, if the share capital increase is not fully subscribed by this date, the share capital shall be deemed to have been increased by an amount equal to the subscriptions received. At the same meeting of September 3, 2009, the Board of Directors also took partial advantage of the power conferred by the Extraordinary Shareholders’ Meeting of May 16, 2007, pursuant to Article 2443 of the Italian Civil Code, increasing the share capital - excluding voting rights pursuant to Article 2441, paragraphs 5 and 8 of the Italian Civil Code - to service the stock option plan via the issue of 5,176,600 new ordinary shares with the same characteristics as those outstanding and an implicit unit price of Euro 0.01. The price of the shares is calculated as Euro 1.1379 for each of 4,784,000 new shares, and as Euro 2.0481 for each of 392,600 new shares.

YOOX GROUP


Pursuant to Article 2439, paragraph 2 of the Italian Civil Code, the deadline for subscription was set at September 3, 2019, with the provision that, if the share capital increase is not fully subscribed by this date, the share capital shall be deemed to have been increased by an amount equal to the subscriptions received. The Extraordinary Shareholders’ Meeting of September 8, 2009 resolved on a share capital increase through payment in cash in one or more tranches, subject to commencement of trading in shares of the Company on the STAR segment of the Mercato Telematico Azionario, organised and managed by Borsa Italiana S.p.A., excluding voting rights pursuant to Article 2441, paragraphs 5 and 8 of the Italian Civil Code, this being the increase to service the incentive plan approved at the Ordinary Shareholders’ Meeting for directors, employees and consultants. The increase will take place via the issue of a total maximum number of 4,732,000 new ordinary shares (after implementation of the share-split as resolved at the same meeting) for a total nominal amount of Euro 47,320 in capital and with a unit price of Euro 0.01. The new shares will carry the same dividend rights as the other shares outstanding at the time of their subscription. The issue prices of the shares will be calculated using the weighted average market price of shares of the Company in the 30 trading days before the options are granted, without prejudice to any minimum prices established by law or the unit price as determined above. If it is not fully subscribed by the deadline of December 31, 2014, the share capital increase will proceed according to the subscriptions received by that date. Institution of the stock option plans and company incentive plans and subsequent changes With regard to stock option plans involving a total of 17,162,652 shares reserved for the employees, associates, consultants and directors of the Company and its subsidiaries, the following options were approved at June 30, 2010: − 21,463 options, corresponding to 1,116,076 shares, by the Extraordinary Shareholders’ Meeting of March 22,

2000, as subsequently amended by the Extraordinary Shareholders’ Meetings of October 25, 2000, February 26, 2002 and May 7, 2003 (2001-2003 plan)

− 28,537 options, corresponding to 1,483,924 shares, by the Extraordinary Shareholders’ Meeting of July 31, 2000, as subsequently amended by the Extraordinary Shareholders’ Meetings of October 25, 2000, February 26, 2002 and May 7, 2003 (2001-2003 plan)

− 33,760 options, corresponding to 1,755,520 shares, by the Extraordinary Shareholders’ Meeting of July 18, 2002, as subsequently amended by the Extraordinary Shareholders’ Meeting of December 2, 2005 (2003-2005 plan)

− 19,669 options, corresponding to 1,022,788 shares, by the Extraordinary Shareholders’ Meeting of December 10, 2003, as subsequently amended by the Extraordinary Shareholders’ Meeting of December 2, 2005 (2004-2006 plan)

− 31,303 options, corresponding to 1,627,756 shares, by the Extraordinary Shareholders’ Meeting of December 2, 2005 (2006-2008 plan)

− 104,319 options27, corresponding to 5,424,588 shares, by the Extraordinary Shareholders’ Meeting of May 16, 2007 (2007-2012 plan)

− 4,732,000 shares, of which up to 85,000 options (2009-2014 plan), by the Extraordinary Shareholders’ Meeting of September 8, 2009, are valid for subscription for 4,420,000 shares and up to 312,000 shares may be granted (2009-2014 incentive plan)

27 The Board of Directors took partial advantage of the powers conferred pursuant to Article 2443 of the Italian Civil Code and increased the share capital to

service the stock option plan by means of the issue of up to 5,176,600 new ordinary shares, which correspond to 99,550 options.

YOOX GROUP


9.23 Non-current financial liabilities - bank loans and other current financial liabilities At June 30, 2010, financial liabilities to banks and other financial institutions totalled Euro 1,381 thousand, an increase compared with December 31, 2009, including Euro 463 thousand to Simest (Società Italiana per le Imprese all’Estero) and Euro 918 thousand to BNP Paribas Lease Group for finance leases. Description Jun 30, 2010 Dec 31, 2009 Change

Financial liabilities 902 693 209

Bank loans and other borrowings 479 313 166

Total 1,381 1,006 375 The syndicated bank loan (lead bank: Unicredit Corporate Banking S.p.A.) was fully repaid on December 15, 2009. The terms of the above loan were renegotiated via an agreement modifying the stand-by revolving syndicated loan contract as of February 17, 2010, applicable from December 15, 2009. As far as the terms of the contract in force until December 31, 2009 are concerned, please refer to the notes to the consolidated financial statement at December 31, 2009. Changes due to the agreement amending the stand-by revolving syndicated loan agreement of June 16, 2008 are reported below. The amending agreement is dated February 17, 2010 and takes effect from December 15, 2009. a) In accordance with Article 6-ter of the Contract (definitive waiver of use and/or reuse), at the due date of

December 15, 2009 fixed in the reduction/amortization plan, the Company hereby declares that it waives, with no penalty, its right to the use of Euro 5,250,000 of the loaned sum, thereby effectively definitively cancelling out this amount from the facility. However, it is understood that, in a partial amendment to Article 2.B (Terms and modalities of use) of the Contract, as of December 15, 2009 (i) the credit line available to the Company will amount to Euro 13,125,000 in total, and (ii) the amount of each drawdown will be no less than Euro 375,000, or a multiple of this amount.

b) In view of point (a) above, and of Article 9 (Amendments to the reduction plan), the banks and the Company

hereby declare and recognise by mutual agreement that, as of December 15, 2009, the amortization/reduction plan described under Article 3 (Modalities and terms of repayment) of the Contract is amended as follows:

Amortization plan Date Amount Residual liability

December 15, 2009 13,125,000

June 15, 2009 1,875,000 11,250,000

December 15, 2010 1,875,000 9,375,000

June 15, 2011 1,875,000 7,500,000

December 15, 2011 1,875,000 5,625,000

June 15, 2012 1,875,000 3,750,000

December 15, 2012 1,875,000 1,875,000

June 15, 2013 1,875,000 -

c) In light of points (a) and (b) above, the parties hereby recognise and state that Article 3-bis (Obligatory early

repayment) of the Contract will no longer apply and shall be deemed to be annulled as of December 15, 2009. Any reference made in the Contract or its appendices to the aforementioned Article 3-bis or its content shall therefore be considered inapplicable.

YOOX GROUP


d) As a partial amendment to Article 14 (Covenants) of the Contract, the banks and the Company recognise and agree that, as of December 31, 2009, the official consolidated financial statements of the Company, periodically approved, will be drawn up in accordance with International Financial Reporting Standards (IFRS). It is also understood that the indicators below, which are contained in the aforementioned Article 14 of the Contract, will have the following new definitions:

1) IFN or PFN (Net Financial Debt or Net Financial Position) is the sum of cash and cash equivalents, other

current financial assets, net of bank loans and borrowings and other financial liabilities falling due within one year, other current financial liabilities and non-current financial liabilities. Net financial debt is not recognised as an accounting item under Italian GAAP or the IFRS endorsed by the European Union.

2) EBITDA or MOL (Earnings before interest, taxes, depreciation and amortization) is profit before

depreciation and amortization, non-recurring expenses, financial income and expenses and income taxes. EBITDA is not recognised as an accounting item under Italian GAAP or the IFRS endorsed by the European Union.

In the event that the net financial position and EBITDA, as defined above, are both positive, the company is considered to be in compliance with the covenants described in a), b) and c) of Article 14 of the Contract by simply notifying the lead bank – within the 30-day period after the approval date of each of the financial statements – of the levels of the above indicators, without the Compliance Certificate described in the aforementioned Article 14. At 30 June, 2010 as the December 31, 2009, the above conditions (positive net financial position and positive EBITDA) have been met and the Group is therefore automatically deemed to have respected the covenants. e) The banks and the company hereby agree to eliminate from Article 13 (Obligations) of the contract provisions

i) and m/3) and to replace them with the following provisions: i) the company undertakes to inform the lead bank in writing of the assumption of financial debt even if equal to

or less than Euro 5,000,000.00 (principal) no later than five bank working days from the date the loan was contracted; m/3) the company will have the right to contract financial debt amounting to more than Euro 5,000,000.00 only with the written consent of the banking syndicate, granted via the lead bank, no later than five bank working days from receipt of the request for approval on the part of the company.

Net financial position The table below gives a breakdown of net financial position at June 30, 2010: Description Jun 30, 2010 Dec 31, 2009 Change

Cash and cash equivalents 11,955 35,007 (23,052)Current financial assets 14,588 - 14,588Other current financial assets 16 16 -Bank loans and other borrowings (479) (313) (166)Other current financial liabilities (115) (20) (95)Net short-term financial position 25,964 34,690 (8,726)Financial liabilities (902) (693) (209)

Net financial position(1) 25,063 33,997 (8,934)(1) As defined in CONSOB communication DEM/6064293 of 07.28.2006 in accordance with CESR recommendations of 02.10.2005. The net financial position of the Group went from Euro 33,997 at December 31, 2009 to Euro 25,063 thousand at June 30, 2010. The cash flow absorbed by operating assets is greatly affected during the half-year period by the payment of taxes for the fiscal year 2009 and on account for 2010 to the tune of Euro 4,837 thousand which only had a marginal impact in the first half of 2009. The half-year period also saw the payment of business debts (Euro 3,531 thousand) and tax liabilities (Euro 3,645 thousand) respectively for the Stock Option quotation and exercise at the close of 2009. Operating management, net of these payments, continues to generate cash. Investing activities, meanwhile, absorbed Euro 3,670 thousand in financial resources, principally for investments in technology.

YOOX GROUP


9.24 Employee benefits This item refers exclusively to the borrowings for post-employment benefits recorded by the Parent in accordance with current legislation. Changes in defined benefit plans for employees in the first half of 2010 are summarised below: Description Dec 31, 2009 Provisions Utilisation Jun 30, 2010

Employee benefits 219 19 (31) 207 The main demographic and economic technical principles taken into consideration for the actuarial calculation of liabilities for benefits to employees at June 30, 2010, are consistent with those highlighted for performing the actuarial calculation at December 31, 2009. 9.25 Deferred tax liabilities Deferred tax liabilities were down by 49%, from Euro 43 thousand at December 31, 2009 to Euro 64 thousand at June 30, 2010. Deferred tax liabilities at June 30, 2010 were recognised in relation to: − unrealised foreign exchange gains at June 30, 2010; − financial instruments at fair value; − employee benefits. Euro 26 thousand in deferred tax liabilities accrued in 2009 were also reversed. 9.26 Provisions for current and non-current risks and charges This item reflects provisions for estimated current liabilities at June 30, 2010, the timing and extent of which cannot be determined. The following table shows the breakdown of the item and changes in the first half of 2010: Description Dec 31, 2009 Increases Utilisation Jun 30, 2010

Provision for theft and loss 123 94 (123) 94

Provision for fines and taxation 18 5 - 23

Provision for fraud 319 260 (122) (457)

Other provisions for risks and charges 78 10 - 88

Total provisions for current risks and charges 538 369 (245) 662

Provisions for disputes 37 - - 37

Other provisions for risks and charges 273 - - 273Total provisions for non-current risks and charges 310 - - 310

Total provisions for risks and charges 848 369 (245) 972 During the half-year period, the provision for theft and loss was used in its entirety. A further accrual of Euro 94 thousand was considered sufficient following a new estimate. During the first half, Euro 122 thousand was used from the provision for fraud. A subsequent accrual of Euro 260 thousand to cover fraud linked with online sales paid for by credit card is considered adequate in line with the new estimate. This fraud coverage provision was calculated taking into account the historical incidence of the value of fraud in relation to the value of sales.

YOOX GROUP


The item other provision for current and non-current risks and expenses includes provisions for liability risks of a probable nature, to be determined in accordance with IAS 37. In the first half of 2010 other provision for risks and current expenses underwent an increase of Euro 10 thousand. 9.27 Trade payables The following table shows a breakdown of trade payables at June 30, 2010: Description Jun 30, 2010 Dec 31, 2009 Change

Due to suppliers 27,060 21,166 5,894

Credit notes to be received from suppliers (335) (1,166) 831

Invoices to be received from suppliers 7,729 7,218 511

Due to credit card operators 73 36 37

Total 34,528 27,254 7,247 Trade payables went from Euro 27,254 thousand at December 31, 2009 to Euro 34,528 thousand at June 30, 2010, an increase of 26.7%. Trade payables are all payables relating to purchases of goods and services from the Group’s suppliers. Payables are recorded at their nominal value. Since all payables fall due within one year, none are subject to discounting. The “Trade payables” item includes all amounts due to suppliers, both for the supply of finished products and raw materials, and for the supply of intangible assets. The increase during the period is linked to the rise in sales volumes, which, due to the Group’s business model, necessitates the purchase of goods in advance of the selling season. 9.28 Tax liabilities Current tax liabilities relate exclusively to the current income tax liability of the Parent and its foreign subsidiaries. During the course of the half-year there was a 79.2% fall of Euro 3,100 thousand going from Euro 3,913 thousand at December 31, 2009 to Euro 813 thousand at June 30, 2010 as a result of the effect of the co-payment of the 2009 balance and the first 2010 payment on account which was made in June 2010. 9.29 Other payables The following table shows a breakdown of payables at June 30: Description Jun 30, 2010 Dec 31, 2009 Change

Due to social security institutions 1,353 1,006 347

Credit notes to be issued to customers 3,014 4,459 (1,445)

Due to directors 202 210 (8)

Due to employees 1,703 1,477 226

Due to tax representatives 2,330 2,531 (201)

Other payables 3,088 5,824 (2,736)

Accrued expenses and deferred income 141 33 108

Total 11,831 15,540 (3,709) The item “Due to social security institutions” reflects contributions payable to social security institutions, mainly on the amounts recognised to employees at the end of the period. The item “Due to tax representatives” reflects indirect tax payables. Sales in European countries during the periods under review exceeded the threshold set in Article 41.1.b) of Legislative Decree 331/93, which requires

YOOX GROUP


payment of VAT in the destination country for goods sold. In order to comply with this requirement, the Company has opened tax positions in these countries. Other payables include credit notes to be issued to customers against certain payables for returns on sales made in the first half of 2010. The substantial change in the item compared with December 31, 2009 is mainly due to payment in the first half of 2010 of payables for withholding tax on employees and contractors deriving from the sale of shares by shareholders and the exercising of stock options by some beneficiaries at December 31, 2009. Consolidated statement of cash flows 9.30 Profit for the period, taxes for the period, depreciation and amortization, income taxes paid Details of profit for the period, taxes for the period, depreciation and amortization and other non-monetary income statement items are provided in Notes 9.11, 9.10, 9.9, 9.5, 9.4 and 9.3 respectively. In relation to the tax charge in the first half of 2010 of Euro 2,273 thousand (Euro 1,015 thousand in the first half of 2009), tax payments amounting to Euro 5,838 thousand were made (Euro 761 thousand in the first half of 2009) relating to tax outstanding for the previous year and payments on account, calculated according to the respective tax regulations in force in the various countries in which the Group operates. 9.31 Other net non-monetary income and expenses Other net non-monetary income and expenses include non-monetary items on the income statement apart from income tax, depreciation and amortization and provisions classified as a direct deduction from asset items (allowance for impairment and provisions for obsolescence). This includes provisions for defined benefit plans for employees (TFR), the measurement at fair value of stock option plans, provisions for risks and charges, capital gains and capital losses, unrealised foreign exchange fluctuations and recognised interest income and expenses. In relation to these last items, interest received and interest paid are presented separately.

9.32 Change in trade receivables, inventories and trade payables This item reports the use or generation of cash relative to net working capital, i.e. changes in trade receivables, inventories and trade payables. Changes in trade payables refer exclusively to supplies of raw materials, goods and services, excluding the change in payables to suppliers of investments, which are reported in the section of the statement of cash flows generated by or used in investing activities. 9.33 Change in other current assets and liabilities This item reflects the change in all other current assets and liabilities, net of the effects of recognising non-monetary income and expenses, i.e. the change in the balances with a direct effect on the use or generation of cash. 9.34 Acquisition of property, plant and equipment and proceeds from the sale of property, plant and

equipment Cash flow from the acquisition of property, plant and equipment reflects both expenditure to replace plants and expenditure on new plants. The amount reported also includes the change in investment payables. 9.35 Acquisition of other intangible assets Cash flow for acquisition of other intangible assets relates to investments in licences and software and the capitalisation of development costs (for a breakdown of these, see Note 9.14). Capitalisations are classified among cash flow from/used in investing activities since they involve a cash outflow associated with the internal costs incurred (mainly personnel expenses). These outflows were broadly in line with costs capitalised during the year.

YOOX GROUP


9.36 Acquisition and cashing of other non-current financial assets Other non-current financial assets total Euro 508 thousand at June 30, 2010 (Euro 409 thousand at December 31, 2009) and mainly relate to guarantee deposits. Non-interest-bearing guarantee deposits at June 30, 2010 relate to rental contracts and contracts for the supply of electricity and gas, and to the existing relationships with Paymentech relating to retentions to guarantee the repayments due for returns made against sales. 9.37 Increase in share capital and share premium reserve The share capital of Euro 511 thousand at June 30, 2010 (Euro 504 thousand at December 31, 2009) increased over the course of the first half of 2010 following the decision of the Board of Directors on January 18, 2010 which assigned 564,200 ordinary shares in favour of several beneficiaries of 10,850 options derived from several Stock Option plans and on May 11, 2010 the Board of Directors assigned 119,600 ordinary shares in favour of a beneficiary of 2,300 options deriving from a Stock Option plan, with an overall effect equal to Euro 7 thousand. The share premium reserve was Euro 54,628 thousand at June 30, 2010 (Euro 54,127 thousand at December 31, 2009); this reserve increased over the course of the first half of 2010 following the decision of the Board of Directors on January 18, 2010 which assigned 564,200 ordinary shares in favour of several beneficiaries of 10,850 options derived from several Stock Option plans and on May 11, 2010 the Board of Directors assigned 119,600 ordinary shares in favour of a beneficiary of 2,300 options deriving from a Stock Option plan, with an overall effect equal to Euro 635 thousand. The increase in the share premium reserve was recognised net of Euro 134 thousand in deferred tax assets accrued in 2009 and since released pursuant to IAS 32; net of prepaid taxes this amounted to Euro 501 thousand. The reserve for future increases in share capital and share premium reserve, which amounted to Euro 0 thousand at June 30, 2010 (Euro 417 thousand at December 31, 2009), includes liabilities to individuals who had paid to exercise stock options at December 31, 2009, but to whom the Company had not made the corresponding ordinary shares available by period-end; 9.38. Arrangement and repayment of non-current financial liabilities Repayments of other non-current financial liabilities relate to loans from banks and other lenders, as described in Note 9.23. 9.39 Arrangement and repayment of short-term financial liabilities The change in short-term bank exposure is included in the change in short-term financial liabilities, since these are forms of short-term borrowing, as described in Note 9.23. 9.40 Investments in financial assets Other current financial assets, equal to Euro 14,588 thousand, refer to Repurchase Agreements with a low risk profile and short term (less than twelve months) agreed with major national Credit Institutions with a high credit rating. Investment in these financial assets is the one of the reasons for the reduction in cash between December 31, 2009 and June 30, 2010. 10. Disclosure of financial risks During the first half of 2010, the nature and structure of the risk exposure detailed below and the associated policies applied by the Group did not change substantially from the previous year.

YOOX GROUP


Market risk Market risk arises from the probability of changes in the fair value of the future cash flows deriving from a financial instrument due to fluctuations in market prices. In the Group’s consolidated financial statements and notes at June 30, 2010, market risk takes the form of currency risk and interest rate risk. Financial risk deriving from currency fluctuations The euro is the functional currency of the Group and is used in the presentation of its financial information. The YOOX Group operates internationally, and the sale of goods in countries whose currency is not the euro exposes the Group to currency risk, in terms of both transactions and translation. Group policy is to concentrate all currency risk within the Parent, YOOX S.p.A.. Since the YOOX Group is essentially an exporter, the main risk exposure consists in depreciation of foreign currencies against the euro. The Group is principally exposed towards the US dollar, the Japanese yen and pound sterling. Currency transaction risks were hedged in the first half of 2010 by forward contracts arranged with the leading domestic and international banks used by YOOX on a daily basis. Outstanding contracts and those negotiated during the half-year period only hedge expected cash flows denominated in US dollars, for the equivalent of Euro 1,717 thousand at June 30, 2010, and in Japanese yen, for the equivalent of Euro 249 thousand. It was not considered necessary to hedge exposure to sterling, since the amount involved was not significant. No speculative derivative contracts were arranged in the first half of 2010 and in the preceding period. Some Group companies are located in countries that are not part of the European Monetary Union, particularly the US and Japan. Since, as mentioned above, the Group’s functional currency is the euro, the income statements of these companies are translated into euros at the average exchange rate for the period. For the same revenues and profits in local currency, changes in exchange rates could have an effect on the amount in euros of revenues, costs and financial results. The euro value of assets and liabilities of consolidated companies whose accounting currency is not the euro may vary depending on exchange rate movements. In accordance with IFRS, the effects of these changes are recognised directly in equity, under the heading “Translation reserve”. Financial risk deriving from interest rate fluctuations Interest rate risk arises when a change in interest rates adversely affects performance for the year. The limited recourse made to external financing, totalling Euro 1,381 thousand at June 30, 2010 does not expose the Group to interest rate risk. Interest rate risk could result in higher borrowing costs only if the Group is obliged to make further use of its stand-by facility, since the interest rate on this line of credit is linked to the Euribor (Euro Interbank Offered Rate). The current financial assets of Euro 14,588 thousand are made up of Repurchase Agreement investments with a low risk profile and short deadline (less than twelve months) with a fixed yield to maturity. Interest rate risk could result in lower financial income if the Group had to reinvest its cash at a market rate lower than the current rate upon maturity of these financial assets. Liquidity risk The Group aims to maintain appropriate levels of liquidity and available funds to support business growth and the timely fulfillment of its obligations. Particularly in the past, when there was a need for cash in order to develop the business, the Group preferred to adopt a flexible approach to financing that reflected the dynamic nature of its business, using both committed credit lines (where lenders cannot request repayment before a predetermined date) and revolving credit lines (where the Group has the option of repaying individual drawdowns, thus replenishing the amount available).

YOOX GROUP


Net financial position at June 30, 2010 was positive at Euro 25,063 thousand. However, partly as proof of the solid relationship that the Group has with its banks, it continues to maintain a number of credit lines, which are currently unused. In this regard, please see the explanatory note, as reported in section 9.23. Credit risk with financial counterparties The YOOX Group has obtained lines of credit from leading Italian and international banks of high credit standing. The balances on the current accounts held in the name of YOOX S.p.A. with banks not resident in Italy are Euro 262 thousand. The Group’s foreign companies have commercial relations with primary lending institutions in the countries in which they operate. Specifically, YOOX Japan makes use of Mitsubishi Bank in Japan, while the two US companies, YOOX Corporation and Y Services, principally use JP Morgan Chase Manhattan Bank. Credit risk with commercial counterparties Given the nature of the Group’s business, management of credit risk deriving from commercial operations is entrusted to the customer care department for online receivables generated by the individual Stores and to the finance department for all other receivables. Credit risk related to doubtful accounts subject to legal action or to overdue accounts is monitored centrally on a daily basis and reported each month. For information on the Group’s exposure and measurement of the above-mentioned financial risks, please refer to the information contained in the consolidated financial statements at December 31, 2009, in respect of which no significant variations have occurred at the present date. Hedge accounting – cash flow hedging The Group performs prospective and retrospective tests of the effectiveness of the derivative financial instruments recorded, using the rules of hedge accounting. Effectiveness is ensured if the ratio of the change in fair value of the hedging instrument to the change in fair value of the hedged instrument falls within the range of 80%-125%. Fair Value The Group uses established assessment techniques, widely used in the market, to calculate the fair value of financial instruments when there is no regulated market for them. These techniques determine the carrying amount that the instruments would have had at the reference date in an arm’s-length transaction between knowledgeable and independent parties. Financial assets and liabilities measured at amortized cost The following are measured on an amortized cost basis: trade receivables and liabilities, time deposits, loans and other assets and liabilities measured at amortized cost (such as other receivables and liabilities). Pursuant to IFRS 7, the fair value of these items is re-measured by calculating the present value of the contractually-expected flows of principal and interest, with reference to the yield curve for government securities at the measurement date. The carrying amount of trade liabilities and receivables represents a reasonable approximation of their fair value.

YOOX GROUP


Financial assets and liabilities measured at fair value Hedging financial instruments and financial instruments held for trading (those not designated as hedges, in accordance with IAS 39) are measured at fair value. Transactions outstanding at the end of the period Transactions outstanding as of June 30, 2010 and the related fair valuesare shown in the following table, which also shows the variationin the value of the underlying assets (where applicable). Going forward, detailed information is provided on individual transactions:

FIN

AN

CIA

L IN

STR

UM

ENT

C

urre

ncy

Fair

valu

e de

rivat

ives

Fa

i r va

lue

shift

Oth

er c

urre

nt

asse

ts28

Oth

er lo

ans29

Oth

er c

urre

nt fi

nanc

ial

asse

ts w

hich

do

not f

orm

pa

rt o

f fix

ed a

sset

s

Med

ium

-Lo

ng-te

rm

finan

cial

lo

ans

Ban

ks a

nd

othe

r fin

anci

al

borr

owin

gs

Ju

ne 3

0, 2

010

Dec

embe

r 31,

200

9Ju

ne 3

0, 2

010

June

30,

201

0Ju

ne 3

0, 2

010

June

30,

201

0Ju

ne 3

0, 2

010

Rep

urch

ase

agre

emen

ts

E

ur

83-

83-

14,5

88

Fina

ncia

l lea

sing

E

ur

59

332

5S

imes

t fin

anci

ng

E

ur

30

915

4To

tal

83-

83-

14,5

8890

247

9

Hed

ging

N

atur

e of

he

dged

risk

Forw

ard

curr

enci

es30

(99)

(4)

(103

)16

(115

)

Gen

eral

Tot

al

(16)

(4)

(20)

16(1

15)

14,5

8890

247

9

28 T

he a

mou

nt re

porte

d he

re re

pres

ents

the

Fair

Val

ue o

f the

forw

ard

cont

ract

s ex

istin

g at

Jun

e 30

, 201

0 an

d re

stat

ed in

the

item

“Oth

er c

urre

nt a

sset

s” in

the

cons

olid

ated

fina

ncia

l pos

ition

repr

esen

ting

ther

efor

e on

e of

thes

e.

29 T

he a

mou

nt re

porte

d he

re re

pres

ents

the

Fair

Val

ue o

f the

forw

ard

cont

ract

s ex

istin

g at

Jun

e 30

, 201

0 an

d re

stat

ed in

the

item

“Oth

er lo

ans”

in th

e co

nsol

idat

ed fi

nanc

ial p

ositi

on re

pres

entin

g th

eref

ore

one

of th

ese.

30

Tra

nsac

ted

in U

SD

and

Jap

anes

e ye

n

YOOX GROUP


YOOX GROUP


11 Information pursuant to IAS 24 on management remuneration and on related parties Transactions with related parties, as defined under IAS 24, at June 30, 2010 and at June 30, 2009 were restricted to commercial, administrative and financial services relationships with subsidiaries and other related parties. The transactions form part of normal business operations, within the usual scope of activity of each of the interested parties, and are carried out under normal market conditions. In this sense, a party is related to an entity if: (a) directly or indirectly through one or more intermediaries, the party:

(i) controls the entity, is controlled by it or is subject to joint control (including controlling or controlled entities and associated companies);

(ii) has significant influence in the entity; or (iii) jointly controls the entity;

(b) the party is an associated company (according to the definition set out in IAS 28 - Investments in Associates) of the entity; (c) the party is a joint venture in which the entity has a shareholding (see IAS 31 Investments in Joint Venture); (d) the party is one of the managers with strategic responsibilities at the entity or its controlling company; (e) the party is a close family member of one of the subjects included in points (a) or (d); (f) the party is a controlled entity, jointly controlled or subject to the significant influence of one of the subjects set forth in points (d) or (e) or these subjects hold, directly or indirectly, a significant share of the voting rights; or (g) the party is a pension fund for employees of the entity or any other entity related to it. An operation with an affiliated party is a transfer of resources, services or obligations between affiliated parties, regardless of the fact that an amount is agreed on. 11.1 Intra-Group transactions In order to provide more information on the extent of relationships within the Group, the following tables present transactions taking place between Group companies and cancelled out in the financial statements at June 30, 2010 and June 30, 2009. The main relationships between the Parent and Group companies are chiefly commercial in nature and can be summarised as follows:

1. The Parent supplies the Group companies with products for sale on the US and Japanese Online Stores. 2. The Parent provides the Group companies with website maintenance, support services and updates. 3. The Parent provides the Group companies with administrative, financial and legal services. 4. The Parent provides the Group companies with customer service support (via a customer care service located at the Italian head office that interfaces with Japanese and US customers using dedicated staff). 5. consulting and support services in the area of fashion, marketing, advertising and professional training provided by the Parent to subsidiaries.

None of the relationships between the Group companies or between the Group companies and related parties are considered to be atypical or unusual, and form part of the Group’s ordinary business operations. The transactions were carried out under normal market (i.e. arm’s-length) conditions.

YOOX GROUP


The following tables show the relationships in terms of receivables and payables between the Group companies at June 30, 2010, at December 31, 2009 and at June 30, 2009. Receivables from and payables to subsidiaries are expressed in USD and JPY and translated to Euro at the exchange rate in effect at year end. Revenues and costs are expressed in USD and JPY and translated to Euro at the average exchange rate for the year in question. June 30, 2010 (Thousand Euro) Trade receivables Trade payables Revenues Costs YOOX Corporation 3,912 - 9,468 -Y Services 343 - 642 -YOOX Japan 1,380 - 3,976 -

Total subsidiaries 5,636 - 14,086 - December 31, 2009 (Thousand Euro) Trade receivables Trade payables Revenues Costs YOOX Corporation 3,763 - 10,919 -Y Services 346 - 897 -YOOX Japan 1,309 - 5,735 -

Total subsidiaries 5,418 - 17,551 - June 30, 2009 (Thousand Euro) Trade receivables Trade payables Revenues Costs YOOX Corporation 5,007 - 4,042 -Y Services 400 - 398 -YOOX Japan 961 - 2,447 -

Total subsidiaries 6,367 - 6,887 - 11.2 Remuneration of senior managers and other key persons within the Group In addition to the executive and non-executive directors, the senior managers and other key persons with strategic responsibilities for the management, planning and control of the Group are the Chief Financial and Control Officer, the former Human Resources Director, the new Human Resources and Organization Director31, the Sales Director, the Marketing Director, the Operations Director, the Chief Technology Officer, the Interactive Services Director, the Multi-Brand Sales Manager, the Mono-Brand Sales Manager, the Head of Research and the Head of Customer Services.

31 Following the resignation of Francesca Gandolfi as Human Resources Director, Giuseppe Guillot was appointed as the new Human Resources and

Organization Director.

YOOX GROUP


The gross annual remuneration of the above persons for the periods under review, inclusive of all forms of remuneration (including gross pay, bonuses and fringe benefits) as well as bonuses accrued but not paid out which are subject to the achievement of long-term objectives are reported in the following table together with the fees of the members of the Board of Statutory Auditors: June 30, 2010

Description Current benefitsLong-term

benefits Stock options Other remuneration

Directors 418 - 505 -

Statutory Auditors 36 - - -

Managers with strategic responsibilities 1,086 58 586 -

Total 1,540 58 1,091 - December 31, 2009




Statutory Auditors 21 - - 68

Managers with strategic responsibilities 1,922 70 745 -

Total 2,649 70 901 68 June 30, 2009




Statutory Auditors 20 - - -

Managers with strategic responsibilities 837 40 98 -

Total 1.223 40 158 - Finally, no close family members of any of the individuals indicated above are related parties of the Issuer and/or of Group companies, as defined in IAS 24. 11.3 Transactions with other related parties The following tables list the main financial and commercial relationships between the companies of the Group and related parties other than Group companies, at June 30, 2010, December 31, 2009, and at June 30, 2009, excluding intra-Group relationships, which are described above. Commercial transactions with these entities are carried out under normal market conditions, and all transactions are carried out in the interests of the Group.

YOOX GROUP


June 30, 2010

Description Trade receivables Trade payables Revenues Costs

Sigma Gi S.p.A. - 700 9 1,377

Diesel S.p.A. 860 1,742 576 3,052

Diesel Rags S.r.l. - 442 - 1,242

55DSL S.r.l. - Unipersonale - 2 - 7

Staff International S.p.A. - 458 - 559

Diesel USA Inc. 243 977 51 1,545

Staff USA Inc. - - - 92

Studio legale d’Urso Gatti e Associati - 159 - 190

Ferrante, PLLC LAW FIRM - 10 - 29

KK TPI - 7 - 21

Nagamine Accounting Office - 1 - 7

Total other related parties 1,103 4,498 636 8,117 December 31, 2009


Sigma Gi S.p.A. - 398 36 2,855

Diesel S.p.A. 919 1,604 742 3,883

Diesel Rags S.r.l. - 899 - 2,026

55DSL S.r.l. - Unipersonale - 10 25 12

Staff International S.p.A. - 323 - 1,608

Diesel USA Inc. 132 900 66 2,174

Staff USA Inc. - - - 76

Studio legale D’Urso Gatti e Associati - 759 - 1,022


Hari K. Samaroo P.C. - - - 3

KK TPI - 2 - 37

Nagamine Accounting Office - - - 7

Total other related parties 1,051 4,907 869 13,757

YOOX GROUP


June 30, 2009


Sigma Gi S.p.A. - 580 - 1,709

Diesel S.p.A. 441 995 224 1,293

Diesel Rags S.r.l. - 260 - 446

55DSL S.r.l. - Unipersonale - 3 10 2

Staff International S.p.A. - 552 - 814

Diesel USA Inc. 220 497 20 726

Staff USA Inc. - 5 - 80

Studio legale D’Urso Gatti e Associati - 99 - 239


KK TPI - 6 - 17

Nagamine Accounting Office - 1 - 7

Total other related parties 661 3,007 254 5,363 The above entities are regarded as related parties of the Group for the following reasons:

• Sigma Gi S.p.A. (formerly Sigma Gi Export Import S.r.l.), since the chairman of the Board of Directors of this company and the owners of the related share capital are shareholders of the Parent;

• Studio legale D’Urso Gatti e Associati, since a shareholder of that law firm is a director of the Parent; • Nagamine Accounting Office and KK TPI, since the owner of both these consultancy firms is a member of

the Board of Directors of a Group company (YOOX Japan); • Diesel S.p.A., Diesel Rags S.r.l., Diesel USA Inc., 55DSL S.r.l. – Unipersonale, Staff International S.p.A.

and Staff USA Inc. (since these companies form part of the Diesel Group), whose Director, through Red Circle S.r.l. Unipersonale, is a shareholder of the Parent and allowed to appoint a director of the Parent;

• Ferrante PLLC LAW FIRM, since a partner in that legal firm is a member of the Board of Directors of one of the Group’s companies (YOOX Corporation).

None of the transactions that took place with related parties in the first half of 2010 and in the first half of 2009 were significant (except as mentioned above), atypical and/or unusual. 12 Commitments The table below details the YOOX Group’s commitments and guarantees at June 30, 2010, December 31, 2009 and June 30, 2009: Description Half-year at

June 30, 2010Fiscal year at

December 31, 2009Half-year at

June 30, 2009Third-party assets held by the Company 42,853 36,658 28,277Sureties given to others 3,031 2,984 2,988Commitments under forward hedging contracts 1,966 2,734 2,884

The warehouses of Group companies hold goods worth Euro 42,853 thousand received on a sale-or-return basis from YOOX’s trading partners. The increase compared with the previous half-year period is due to the opening of new online shops and the increase in account sales procurement.

YOOX GROUP


The sureties, all given by the Parent at June 30, 2010, relate to the following contracts: • the contract for tax representation in Spain concluded with Claramonte Fortuno Asesores (Calle Mayor San

Jaime 12, Vila-real, Castellon) amounting to Euro 300,000 to guarantee VAT compliance, expiring December 31, 2010.

• the contract agreed by the Company, with effect from October 1, 2008 for a period of six years, for the rental of office premises at Via Autari 27 in Milan. The surety amounts to Euro 60,000 and expires on September 30, 2014.

• the contract agreed with ND Logistics Italia S.p.A. for the provision of integrated logistics services for Euro 500,000 with effect from March 14, 2007 for a period of five and a half years, expiring on October 14, 2012;

• the contract agreed with Diesel to guarantee payments by the subsidiary Y Services Ltd. amounting to USD 590,000 (Euro 480,808.41) with effect from November 2, 2007 and expiring on December 31, 2010;

• The contract agreed with ND Logistics S.p.A. to guarantee compliance with obligations under a subletting contract for Euro 46,875 with effect from October 10, 2007 for a period of six years, expiring on June 9, 2013.

• The contract agreed by the Company with Despina S.p.A. to guarantee compliance with obligations under a rental contract with effect from April 1, 2007, for a period of six years, relating to office premises at Via Nannetti 1 in Zola Predosa. The surety amounts to Euro 47,500 and expires on March 31, 2013.

• the contract agreed with SIMEST to guarantee the loan amounting to Euro 110,019.47 with effect from September 26, 2006 and expiring on March 16, 2014;

• the contract agreed with SIMEST to guarantee the loan amounting to Euro 551,212.49 with effect from January 17, 2008 and expiring on March 16, 2014;

• the contract agreed by the Company with New Winds Group to guarantee compliance with obligations under a rental contract for office premises in Madrid, with effect from August 1, 2008. The surety amounts to Euro 18,839.04 and expires on September 1, 2010;

• the contract agreed with MM. Kerr and MM. Naret, to guarantee compliance with obligations under a rental contract for office premises in Paris with effect from August 1, 2008. The surety amounts to Euro 50,000 and expires on July 31, 2011.

• The contract agreed by the Company with Oslavia, with effect from July 1, 2008, for a period of six years, for the rental of office premises in Via Lombardini, Milan. The surety amounts to Euro 19,200 and expires on July 31, 2014.

• The contract agreed by the Company to guarantee VAT compliance in Portugal, for Euro 5,000, issued to the Portuguese tax representative and expiring on January 31, 2011.

• The contract agreed by the Company following the repayment of the Global Collect guarantee deposit of Euro 800,000, after BNP Paribas issued a bank guarantee for the same amount. Expiry of the guarantee April 30, 2011

• the contract agreed by the Company with Sig.ra Iolanda Labisi to guarantee compliance with obligations under a rental contract for office premises in via Toscanini in Milan with, with effect from April 1, 2014. The surety amounts to Euro 12,000 and expires on April 30, 2014.

• The contract agreed with Koji Ono Director of YOOX Japan for Yen 3,200.00 equal to Euro 29,414.47 and expiring on June 30, 2010.

YOOX GROUP


The hedging contracts relate to forward sales and options set up by the Parent to cover the currency risk connected to intra-Group sales in US Dollar and Japanese Yen. The total amount of these commitments, converted into Euro at the exchange rate in effect at the end of the half-year period, is Euro 1,966 thousand. 13 Significant non-recurring events and transactions The YOOX Group did not engage in significant non-recurring transactions during the first half of 2010, with the exception of those specified in section 9.23 of the current condensed consolidated interim financial statements. 14 Positions or changes resulting from atypical and/or unusual transactions There were no positions or changes resulting from atypical and/or unusual transactions during the first half of 2010. 15 Significant events after June 30, 2010 Newly appointed Chief Financial Officer and Director in charge of preparing corporate accounting documents On July 1, 2010 the Board of Directors appointed Francesco Guidotti as the new Chief Financial Officer and Director in charge of preparing corporate accounting documents, following the resignation of Paolo Fietta with effect from June 30, 2010. Co-opting of a director and appointment of a member of the Internal Control Committee On July 1, 2010 the Board of Directors co-opted as a member of the Board Raffaello Napoleone, in view of the resignation of the director Fausto Boni. Raffaello Napoleone was also appointed member of the Internal Control Committee, a position previously held by Fausto Boni. Appointment of the new Board of Directors of YOOX Corporation On July 1, 2010, the new Board of Directors was appointed of the subsidiary company YOOX Corporation. Appointment of a member of the Supervisory Body On July 1, 2010 the Board of Directors, following the resignation of Francesco Guidotti as member of the Supervisory Body, appointed Gerardo Diamanti as his replacement. Granting of the 2009-2014 Stock Option Plan and YOOX S.p.A. 2009-2014 Incentive Plan On July 1, 2010, the Company’s Board of Directors decided to grant 13,965 options related to 726,180 YOOX S.p.A. ordinary shares in relation to the 2009-2014 Stock Option Plan, approved on March 11, 2010. On the same date the Board also approved the Regulations of the YOOX S.p.A. Company Incentive Plan for 2009-2014 and decided on the free allocation of 124,436 YOOX S.p.A. ordinary shares to 25 employees. Start of own shares buyback programme On July 13, 2010 the Company announced that it has initiated a programme to purchase its own shares, pursuant to the resolutions passed by the shareholders on October 7, 2009 and the Board of Directors on July 1, 2010. To date, YOOX S.p.A. has purchased, through Mediobanca Banca di Credito Finanziaria S.p.A., in the period from July 2, 2010-July 7, 2010, a total of 62,000 YOOX S.p.A. ordinary shares, representing 0.1214% of the share capital, at an average price of Euro 5.836485 per share before fees, for a total of Euro 361,862.06. New Release 9.0 yoox.com The new 9.0 release of yoox.com was launched at the beginning of August 2010, which incorporated CRM functions (Recommendation Engine and Behavioural Targeting). A significant number of new e-commerce functions were also developed in order to improve the presentation of the product (such as, for example, the full screen zoom), the perception of performance through a functional and technical revision of the navigation and search system and, lastly, the integration of the video contents to give the user an experience where they feel more involved. Exercise of Stock Options Following the decision of the Board of Directors on August 5, 2010, there was a subscription of 174,200 new shares for a nominal value of Euro 1,742.00 following the stock option exercise by a beneficiary.

YOOX GROUP


Zola Predosa (BO), August 5 2010 For the Board of Directors

The Chairman of The Board of Directors Federico Marchetti

(signed on the original)

YOOX GROUP


Annex 1 Consolidated income statement for the year ended June 30, 2010, prepared in accordance with CONSOB Resolution 15519 of July 27, 2006 and CONSOB Communication DEM/6064293 of July 28, 2006 (in thousands of Euro). June 30, 2010 June 30, 2009

Consolidated income statement

Balances of which with related parties Balances of which with

related parties

Thousand euro

Net revenues 96,554 636 68,305 254

Cost of goods sold (59,445) (7,872) (42,635) (5,064)

Fulfillment costs (10,220) (223) (7,566) (205)

Sales and marketing costs (11,425) (664) (7,843) (331)

General expenses (9,916) (2,047) (6,344) (1,185)

Other income and expenses (240) (624)

Non-recurring expenses - -

Operating profit 5,308 3,293

Financial income 843 337

Financial expenses (539) (1,053)

Profit before tax 5,612 2,577

Tax (2,273) (1,015)

Consolidated profit for the period 3,339 1,562

Of which:

Basic earings per share 0.07 0.04

Diluited earings per share 0.06 0.03

YOOX GROUP


Weighting on individual income statement items in percentage terms. June 30, 2010 June 30, 2009

Consolidated income statement

Balances of which with related parties Balances of which with

related parties

Thousand euro

Net revenues 100% 0.66% 100% 0.37%

Cost of goods sold 100% 13.24% 100% 11.88%

Fulfillment costs 100% 2.18% 100% 2.71%

Sales and marketing costs 100% 5.81% 100% 4.22%

General expenses 100% 20.65% 100% 18.68%

Other income and expenses 100% 100%

Non-recurring expenses 100% 100%

Operating profit 100% 100%

Financial income 100% 100%

Financial expenses 100% 100%

Profit before tax 100% 100%

Tax 100% 100%

Consolidated profit for the period 100% 100%

YOOX GROUP


Annex 2 Consolidated statement of financial position at June 30, 2010, prepared in accordance with CONSOB Resolution 15519 of July 27, 2006 and CONSOB Communication DEM/6064293 of July 28, 2006 (in thousands of Euro). June 30, 2010 December 31, 2009

Consolidated statement of financial position Balances of which with related parties % weighting Balances of which with

related parties % weighting

Amounts in thousands of euro and percentage weighting on individual items

Non-current assets

Property, plant and equipment 4,060 3,508

Intangible assets with finite useful life 5,368 3,420

Deferred tax assets 4,034 3,546

Other non-current financial assets 508 409

Total non-current assets 13,970 10,883

Current assets

Inventories 58,525 47,054

Trade receivables 5,703 1,103 19.34% 6,743 1,051 15.59%

Other current assets 4,409 3,213

Cash and cash equivalents 11,955 35,007

Financial current assets 14,588

Total current assets 95,180 92,017

Total assets 109,150 102,900

YOOX GROUP


June 30, 2010 December 31, 2009

Consolidated statement of financial position Balances of which with related parties % weighting Balances of which with

related parties % weighting

Equity

Share capital 511 504

Reserves 60,867 58,937

Losses carried forward (5,364) (9,462)

Consolidated profit for the year 3,339 4,098

Equity attributable to equity holders of the Parent 59,353 54,077

Equity attributable to non-controlling interests - -

Total consolidated equity 59,353 54,077

Non-current liabilities

Financial liabilities 902 693

Employee benefits 207 219

Provisions for risks and charges 310 310

Deferred tax liabilities 64 43

Total non-current liabilities 1,484 1,265

Bank loans and other current financial liabilities 479 313

Provisions for risks and charges 662 538

Trade payables 34,528 4,498 13.03% 27,254 4,907 18.00%

Tax liabilities 813 3,913

Other payables 11,831 15,540

Total current liabilities 48,313 47,558

Total consolidated equity and liabilities 109,150 102,900

YOOX GROUP


Annex 3 Consolidated statement of cash flows at June 30, 2010, prepared in accordance with CONSOB Resolution 15519 of July 27, 2006 and CONSOB Communication DEM/6064293 of July 28, 2006 (in thousands of Euro). June 30, 2010 June 30, 2009

Consolidated statement of cash flows Balances of which

with related parties

% weighting Balances

of which with related

parties %

weighting

Amounts in thousands of euro and percentage weighting on individual items Consolidated profit for the period 3,339 1,562Adjustments for: Taxes for the period 2,273 1,015Financial expenses for the period 538 1,053Financial income for the period (843) (336)Depreciation, amortization and impairment losses for the period 1,525 889Fair value measurement of stock options 1,319 272Unrealised effect of changes in foreign exchange rates 525 (91)(Gains)/losses on sale of non-current assets - -Employee benefits 19 4Provisions for risks and charges 369 420Payment of employee benefits (30) (53)Use of the provisions for risks and charges (245) (168)Changes in inventories (11,471) (4,806)Changes in trade receivables 1,040 (52) (5.00)% 1,101 (661) (60.04)%Changes in trade payables 7,273 (409) (5.62)% 5,518 2,307 41.81%Changes in other current assets and liabilities (4,905) 793Cash flow from (used in) operating activities 727 7,173 Income tax paid (5,838) (761)Interest and other financial expenses paid (538) (1,283)Interest and other financial income received 843 336NET CASH FLOW FROM (USED IN) OPERATING ACTIVITIES (4,806) 5,465

YOOX GROUP


June 30, 2010 June 30, 2009

Consolidated statement of cash flows Balances of which

with related parties

% weighting Balances

of which with related

parties %

weighting

Investing activities Acquisition of property, plant and equipment (732) (220)Acquisition of intangible assets (2,839) (1,138)Acquisition of other non-current financial assets (99)Proceeds from sale of other non-current financial assets - 774Proceeds from sale of property, plant and equipment - 4- NET CASH FLOW FROM (USED IN) INVESTING ACTIVITIES (3,670) (580) Financing activities New short-term financial liabilities - -Repayment of short-term financial liabilities (3) (3,932)New non-current financial liabilities - -Repayment of non-current financial liabilities (78) (2,762)Increase in share capital and share premium reserve 92 5,428Investments in financial assets 14,588 -NET CASH FLOW FROM (USED IN) FINANCING ACTIVITIES (14,577) (1,266) TOTAL CASH FLOW FOR THE PERIOD (23,052) 3,619 Cash and cash equivalents at the beginning of the period 35,007 8,962Cash and cash equivalents at the end of the period 11,955 12,581TOTAL CASH FLOW FOR THE PERIOD (23,052) 3,619

YOOX GROUP


YOOX GROUP


1. The undersigned Federico Marchetti, Chairman and Chief Executive Officer and Francesco Guidotti, Chief Financial Officer of YOOX S.p.A. hereby bear witness, having taken into account the provisions of article 154-bis, paragraphs 3 and 4, of legislative decree no. 58 of February 24, 1998, to:

• the suitability in relation to the attributes of the business and • the effective application of the administrative and accounting procedures for the compilation of the

condensed consolidated interim financial statements, during the period of January 1, 2010 to June 30, 2010.

2. No significant aspects have emerged in this regard. 3. They also bear witness to the fact that: 3.1 the condensed consolidated interim financial statements:

a) have been compiled in compliance with the international financial reporting standard endorsed by the European Union in accordance with (EC) ruling no. 1606/2002 of the European Parliament and Council of July 19, 2002;

b) corresponds to the results of the books of account and ledgers; c) are suitable to provide a truthful and correct representation of the financial position and results operations

of the issuer and the Group companies. 3.2 The interim Director’s Report includes a reliable analysis of the references to important events that have occurred during the first six months of the fiscal year and their influence on the condensed consolidated interim financial statements, together with a description of the main risks and uncertainties for the remaining six months of the fiscal year. The interim Director’s Report also includes a reliable analysis of disclosure of related party transactions. Zola Predosa (BO), August 5, 2010

Chairman and Chief Executive Officer Director in charge of preparing corporate accounting documents Federico Marchetti Francesco Guidotti (signed on the original) (signed on the original)

Certification of the condensed consolidated interim financial statements pursuant to article 81-ter of CONSOB Regulation no. 11971 of May 14,

1999, as amended

YOOX GROUP


Auditors’ review report on the condensed consolidated interim financial statements at June 30, 2010

Sem YOOX 10 ENG 04cdn3.yoox.biz/cloud/yooxgroup/uploads/doc/2014/... · A growing number of fashion...

Documents

Transcript of Sem YOOX 10 ENG 04cdn3.yoox.biz/cloud/yooxgroup/uploads/doc/2014/... · A growing number of fashion...