Outstanding performance of MBFG Leather Goods boutiques in 2007

01 Apr '08

5 min read

The improved sales mix is evidenced by the increased weight of revenues from:

• Leather Goods and Fashion Jewellery that, together, generated over than 50% of consolidated “core” operating revenues;

• Export sales which generated 62% of consolidated operating revenues with emerging markets representing 30%, and US and Japan, together, representing less than 5% of the Group's revenues;

• Direct distribution channels which generate 66,5% of consolidated operating revenues.

EBIT of € 82,3 million from € 92,6 million of 2006; net of extraordinary items, Group Ebit realised growth of 24,6%. Net Income of € 51million from € 63,3 million of 2006.

Strategic and Operating Highlights:
• In addition to the agreement signed with Damas Jewellery in June, 2007, MBFG entered into an important agreement with the Gitanjali Group in December, 2007 for the establishment of a Joint Venture to operate in the apparel, leather goods and jewellery sectors in India.

The Gitanjali Group is a leader in the production and distribution of jewellery in India and is expected to contribute its know-how in production, marketing, logistics and distribution, as well as its extensive retail network; the Joint Venture is expected to open 32 mono and multi brand boutiques and 132 shop-in-shops over the next three years.

• The Group continues to focus on its leather goods and fashion jewellery divisions, businesses characterised by higher growth and margins.

This is evidenced by the acquisition of Calgaro, an Italian jewellery company renowned for its innovative woven gold and silver jewellery collections, and Dadorosa, the worldwide licensee of the Gherardini brand, as well as the sale of the multi brand retail division.

• An exclusive licensing agreement has been signed for the production and distribution of John Galliano women's jewellery collections, to be launched at the Basel Jewellery trade fair in April, 2008.

The collections will be created by John Galliano and produced and distributed worldwide by Valente Gioiellieri SpA. Other important licensing agreements signed by MBFG during the year include Phard e Bogner for the production and distribution of children's wear collections, Aquascutum for the production and international distribution of handbag, footwear and accessories collections and Amazon Life for the production and distribution of “eco friendly” handbags and accessories.

• Contined expansion of the international retail network which includes 243 monobrand boutiques worldwide. During the fourth quarter of 2007 MBFG inaugurated 18 boutiques: 5 DOS (1 Rosato in Florence, 1 multibrand Gioielli d'Italia in Lugano, 1 Braccialini in Varese, 1 Francesco Biasia in Milan and 1 Coccinelle in Rome) and 13 Franchisees (1 Valente in Macao, 3 Baldinini in Russia, 1 Braccialini in Russia, 5 Francesco Biasia: Rome, Warsaw, Macao and 2 in Russia; 3 Coccinelle: 1 Prague, 1 Warsaw and 1 in Beirut). In 2007 MBFG inaugurated a total of 46 boutiques.

GENERAL SHAREHOLDERS' MEETING:
The General Shareholders' Meeting of Mariella Burani Fashion Group Spa has been convened on April 29th, 2008 at 9:00 am and in second call on May 7th, 2008 at 9:00 am in Cavriago (Re), via della Repubblica 86.

DIVIDENDS:
The Board of Directors of Mariella Burani S.p.A. proposed the distribution of an ordinary dividend of € 0,16 per share to be paid on May 29th, 2008.

BUY-BACK PLAN:
The Board of Directors of Mariella Burani Fashion Group S.p.A. agreed to extend the existing buy-back plan that provides for the purchase and sale of up to 10% of the Group's outstanding common shares. The plan will be in effect until the shareholders meeting to approve the financial statements for the year ended December 31, 2008.

Share transactions will be effected in markets regulated by Article 132 of Legislative Decree No. 58 dated February 24, 1998 and Article 144bis,1.B of Consob Regulation 11971/99 as modified by the Market Abuse Directive (“MAD”) in conformance with the

Mariella Burani Fashion Group S.p.A.

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