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Little impact of economic slowdown on H1 sales, Van de Velde
Aug '10
Van de Velde, a leading player in the luxury and fashionable women's lingerie sector, announced first half result of 2010.

Organic growth in the first half of 2010 was 8.2% (excluding Intimacy). Given the low economic growth in Europe and the USA, Van de Velde is very satisfied with that development and thanks its customers and consumers for their trust. Every country worldwide posted growth. Growth in the USA and Canada was most impressive, but the European core markets also posted strong growth figures.

Turnover growth is mainly driven by a strong rise in volume. Exchange rates (versus €) had a positive impact of a little over 1%.

On a store-to-store basis, turnover grew somewhat at our own 'Lingerie Styling' stores (seven in Europe). The German stores were converted to the new Oreia concept.

Sarda turnover continued to decrease in the first half of 2010, but there is a clear swing in the second half of the year, compared with the second half of 2009. The initial signs from the first half of 2011 appeared to confirm this swing.

Gross Margin Growth And Steady Costs
The cost savings implemented in 2009 (Barcelona, Hungary) boosted the gross margin. All other costs were fairly steady, including all costs that promote growth (marketing, sales programmes, prospecting in new zones).

Strong EBITDA and Profit Growth
As a result of the above, EBITDA (excluding Intimacy) rose by 24.7%. Net profit (excluding Intimacy) grew by 39.3%. Non-recurring restructuring costs and a write-off on the CDO portfolio did have a negative impact on the 2009 figures, which was not the case in 2010. When these factors are excluded, REBITDA (recurring EBITDA) grew by almost 19%.

Minority Stakes And Financial Result
Top Form contributed positively to the net profit. Intimacy was fully consolidated as of the end of April 2010 after the acquisition of the controlling interest.

The financial result also made a positive contribution to the net profit, in contrast to previous year.

The growth of Intimacy is on schedule. Expected turnover for the full year 2010 is around $38m, with EBITDA of $2.1m (which will not be included in Van de Velde's consolidated figures before 1 May 2010). Four new stores will open in 2010 (two in Los Angeles and environs in June and two in the autumn), which will bring the total number of stores to 13 by the end of 2010. The goal is to have at least 20 stores in the United States by the end of 2012.

The market share of our brands (Marie Jo and PrimaDonna) in the Intimacy stores continues to grow.

The recognition of Intimacy in Van de Velde's consolidated figures is explained in detail in the interim financial report. The main points of this consolidation are as follows:

• Intimacy will be fully recognised as from 1 May 2010.
• Including Intimacy, turnover rose to €83.4m and EBITDA to €28.5m. Intimacy's EBITDA for May and June 2010 was €0.4m. The consolidated contribution at EBITDA level (after elimination of intercompany transactions) amounted to €0.2m.

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