Accell Group. The Initiative in Cycling & Fitness. London,

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1 Accell Group The Initiative London, René J. Takens, CEO since 1999 Hielke H. Sybesma, CFO since

2 Business profile Three product groups: Bicycles, Bicycle parts & accessories, Fitness Focused marketing of national and international brands Innovation and differentiation by way of modern design and product specifications Efficient logistics and production Effective management of costs and sales prices Group synergy Growth organic and by acquisitions 2

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4 European Bicycle Market Total market size: estimated 18 million bicycles sold annually in EU-25 Price range bicycles: 69-14,999 Top 5: Country No. of bicycles sold Germany 4.5 million United Kingdom 2.2 million France 2.0 million Italy 2.0 million The Netherlands 1.3 million Each country has its own market characteristics Type of bicycles sold Average price / quality Look & feel of bicycle Distribution channel / outlets Rather stable, mature markets with steady growth in high-end segments 4

5 Accell group positioning in the European Bicycle Market Traditionally strong presence in Europe for many years 2004 sales level: 275 million #1 player in Europe Focus on mid and high-end segments; quality brands and products Sold mainly through network of selected retail (bicycle) specialists Complete range of products: City bikes Trekking bikes Racing bikes All terrain bikes (ATB) Children bikes Leading market positions in key markets: Benelux, Germany, France and Finland 5

6 European Bike Parts & Accessories Market Total market size: estimated at 1.2 billion Top 4 markets include Germany, Benelux, France and Italy Germany and Benelux market size estimated at 500 million Steadily growing market: Increasing demand bike parts for maintenance and repair purposes Increasing demand accessories for comfort and functionality purposes Highly complementary to bicycle market 6

7 Accell Group positioning in the European Bike Parts & Accessories Market Accell activities parts & accessories started in 2001 BikeParts: part of Winora acquisition - Germany Sold mainly through network of selected (bicycle) retail specialists Range includes 14,000 articles Rapid expansion through acquisitions building market positions in Benelux and Germany 2004 sales level: EUR 45 million Current market positions in general are still modest 7

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9 Fitness Market Global market for fitness equipment: estimated at 4.7 billion Home Use Segment is steadily growing market European home fitness market is currently estimated at 500 million Price range fitness equipment: 199-4,999 Main markets are Western Europe and North America Fitness market is less fragmented than Cycling market product characteristics are more universal one product portfolio for global marketing and sales 9

10 Accell Group positioning in the Fitness Market Accell activities fitness started in 2003 Tunturi acquisition - Finland Focus on mid and high-end segments of home-use market; quality brands / products only Sold mainly via network of retail (fitness) specialists Range includes treadmills, cross trainers, exercise bikes, step trainers Distribution network: Europe (70%), North America (10%) and ROW (20%) Current market position is modest offering significant growth potential 2004 sales level: EUR 21.4 million 10

11 Sustainable Underlying Trends for Growth and Fitness Demographic trends Double incomes are the fastest growing category who spend a lot of time and money on recreation and wellness Ageing European population; increasing number of older, healthier people, eager to stay socially, mentally and physically active New generation of retired and more wealthy people having plenty of time for recreation Political trends Growing attention from governments for a safe bicycle infrastructure in cities and in the country Growing attention for environmental issues, measures for reducing car use in favor of alternative transport (specifically short distance mobility) Consumer lifestyle trends Increasing interest in a healthier lifestyle, health consciousness, fitness and stress relief are stimulating market demand for active outdoor and indoor recreation Growing individualization, expression of way of life, increasing desire to stand out from the crowd 11

12 Accell Group Business Model We are the leading player in developing and marketing of durable branded consumer goods for short distance mobility, fitness and active recreation Strong focus on mid and high-end market segments of our respective markets Consistently adding value to our Cycling and Fitness products through focus on: Branding Innovation & Design (Product) Expertise & (After Sales) Service Allocating capital where we can add the most value: R&D Marketing Expansion of trade activities Targeted acquisitions 12

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14 Branding Building on strong national and international brands brands with a long history each brand having its own unique positioning Our brands have emotional value are more than just an unmistakable trade name are more than only synonymous to a high quality product Our brands create customer loyalty 14

15 Innovation & Design Innovation and emotion mean progress R&D is crucial in order to anticipate consumer fashion trends Comfort Safety Shape, colors and materials new features, new gadgets Every season starts with the introduction of a new collection of bicycles and fitness equipment Brands / products need to stand out in the retail specialist shops and appeal to our critical and demanding consumers 15

16 Expertise & Service Strong distribution network and relationship with our dealers / resellers are key consistent branding through our distribution network Dealers / specialist resellers guarantee the best service for our customers Advice and educational support for our dealers / resellers: Product technicalities Marketing Warranty policies and after sales service 16

17 Accell Group Long Term Growth Model Aimed at strengthening our market positions in order to increase our profitability and realize a healthy and sustainable return on investment for our shareholders Organic growth in all three business activities Geared by targeted acquisitions possible in all three business activities Increasing group synergies between bicycles, parts & accessories and fitness typically in fields of marketing, assembly, distribution and R&D Realizing cost efficiencies throughout the group 17

18 Business Strategy Bicycles Brand portfolio management Increase brand performances Market positions Innovation & differentiation Profitability Increase bicycle group synergies / cost efficiencies Assembly Purchasing Logistics 18

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20 Business Strategy Bike Parts & Accessories Strengthen current market positions in The Netherlands and Germany Integrate existing trading companies Acquire new positions / new companies Expand European Business Focus on Accell Group core countries Realize P&A group synergies Brand / product portfolio management Purchase Logistics 20

21 Business Strategy Fitness Optimize brand / product portfolio aimed at home use market More price points More types of fitness equipment and accessories Increase distribution power / expand European distribution network Focus on European market Acquire new positions / new companies 21

22 Strong Group Track Record Double digit EPS-growth for more than 5 consecutive years H H Turnover EBIT , ,4 1,2 1 0,8 0,6 0,4 0, H Net profit H EPS 22

23 Turnover Split H Geographical Type 23

24 Continued strong performance in H (x EUR miljoen) Sales 204,3 341,1 213,8 5% EBIT 13,4 22,7 16,1 20% Net profit 7,6 13,1 9,6 26% EPS 0,90 1,54 1,10 22% Solvency 37,4% 36,9% 41,2% More sales in higher-end segments Higher average prices and higher added value Strong growth of Parts & Accessories and Fitness 24

25 Outlook full year 2005 and beyond 2005: First half of the year is always stronger than second half of the year (seasonal pattern) Consumer confidence still remains at low to modest levels for H For the full year 2005 an EPS-increase of 5 15% is expected Beyond: Favorable long term prospects based on sustainable growth drivers Steady growth in lucrative higher-end market segments expected to continue for the years to come Attractive Parts & Accessories and Fitness markets and currently still modest market positions offer additional upward potential 25

26 Investment Highlights Diverse and sustainable underlying growth trends Strong growth / financial track record during years of low to modest consumer spending and continuous pressure on retail margins Competent management team Proven business model offering the best quality Cycling and Fitness products consistently adding value through focus on branding, innovation, design and service Solid financial position (balance sheet, cash flow) Modest price / earnings ratio (year-end 2004: 10) 26

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