THE NEW CODE Interim Report 1 January to 31 March 2015

THE NEW CODE Interim Report 1 January to 31 March 2015

KEy figures TOM TAILOR GROUP EUR million Q1 2015 Q1 2014 Change relative Revenue 215.7 208.7 3.4% TOM TAILOR Retail 58.9 59.2 0.6% TOM TAILOR Wholesale 84.5 81.1 4.2% BONITA 72.4 68.4 5.8% Share of revenue (in %) TOM TAILOR Retail 27.3 28.4 TOM TAILOR Wholesale 39.2 38.9 BONITA 33.5 32.8 Gross profit 119.3 118.8 0.4% Gross margin (in %) 55.3 56.9 Recurring EBITDA 9.1 11.1 18.1% Recurring EBITDA margin (in %) 4.2 5.3 One-off items/special factors 1.3 1.2 5.0% EBITDA 7.8 9.9 20.8% EBITDA margin (in %) 3.6 4.7 Recurring EBIT 0.6 0.3 284.0% Recurring EBIT margin (in %) 0.3 0.1 One-off items/special factors (net of imputed tax effects) 3.6 3.5 1.5% EBIT 4.1 3.2 28.3% EBIT margin (in %) 1.9 1.5 Recurring net income for the period 4.0 3.8 4.9% Recurring earnings per share (in EUR) 0.19 0.18 4.3% One-off items/special factors (including imputed tax effects) 2.9 2.9 1.2% Net income for the period 6.9 6.7 3.3% Earnings per share (in EUR) 0.30 0.29 3.3% Cash generated from in operations 8.3 11.7 29.2% Net cash used in investing activities 7.4 4.1 81.0% Free cash flow 17.4 17.1 1.8% 31/03/2015 31/03/2014 Total assets 801.6 755.6 6.1% Equity 237.4 216.8 9.5% Equity ratio (in %) 29.6 28.7 Cash funds 33.4 39.9 16.2% Financial liabilities 265.4 277.5 4.4% Net debt 232.0 237.6 2.4% Gearing (in %) 97.7 109.6 Employees (reporting date) 6,537 6,527 0.2% TOM TAILOR Wholesale 777 703 10.5% TOM TAILOR Retail 1,852 1,682 10.1% BONITA 3,908 4,142 5.6% General note: Due to the presentation of rounded figures, some totals might deviate from the sum total of the respective individual items.

contents 03 Our Brands 05 Letter to Shareholders 07 Highlights in Q1/2015 09 TOM TAILOR on the Capital Market 11 interim management report 12 Fundamental Information about the Group 15 Report on Economic Position 24 Employees 25 Risks and Opportunities 25 Report on Post-Balance Sheet Date Events 26 Report on Expected Developments 30 consolidated Interim financial statements 31 Consolidated Income Statement 32 Consolidated Statement of Comprehensive Income 33 Consolidated Balance Sheet 35 Consolidated Statement of Changes in Equity 37 Consolidated Statement of Cash flows 38 Notes to the Consolidated Interim Financial Statements 45 Additional Information 45 Financial Calendar 46 Future-Oriented Statements 47 Publication Details

our brands our brand world The TOM TAILOR brand pro- Stylish, sexy, trendy these In 2012 TOM TAILOR POLO The TOM TAILOR CONTEM- jects a fashionable, confi- looks are targeted at young TEAM was launched as the PORARY brand was laun- dent and authentic style. The TOM TAILOR WOMEN people aged 15 to 25. Focusing on denim, the TOM third TOM TAILOR brand. This premium brand caters ched in 2014. Featuring carefully selected fabrics and TOM TAILOR MEN lines TAILOR Denim Female and to women and men aged 25 and the highest-quality are aimed at adults aged 25 TOM TAILOR Denim Male to 40 with uncomplicated, workmanship, these collec- to 40. The TOM TAILOR KIDS, lines appeal to anyone who but elegant and meticu- tions project a fashion-for- TOM TAILOR MINIS and TOM likes an unconventional lously finished sportswear. ward image. Authenticity, TAILOR BABY lines cater to lifestyle. self-confidence, individua- the younger target groups lity this is the essence of from 0 to 14 years old. the TOM TAILOR CONTEM- PORARY brand. 03

our brands Women over 40 are the target group for the BONITA brand. These collections continually highlight new trends and feature highquality items of clothing that can be mixed and matched over and over to create stylish new outfits. Offering an excellent fit, a large selection of different styles and high-quality materials, BONITA men provides casual men s fashion that can be mixed and matched. The latest fashion trends are drawn upon and combined with maximum comfort. From sporty to fashionable, BONITA men offers elegance and casualness. 04

Letter to shareholders letter to shareholders Dear Shareholders and Friends of TOM TAILOR, In the first quarter, the TOM TAILOR GROUP continued its positive performance of the previous year, starting financial year 2015 with good momentum. The collections from TOM TAILOR and BONITA enjoyed fairly solid demand in the early months of the year. Between January and March, the Group lifted consolidated revenue by over 3% to around EUR 216 million. Whereas Germany s entire textile industry had to contend with a challenging market environment and closed the first quarter down 5%, we were fortunately able to buck this trend. BONITA in particular provided powerful stimulus for growth in the first quarter. This segment recorded a gratifying increase in revenue of around 6% to over EUR 72 million. Among the main factors contributing to this encouraging development were measures designed to improve the quality of products and designs, the accelerated procurement times and also specific sales promotions in January. These promotions were tied in with last autumn s lower sales and slightly reduced the gross margin, which was very high in the prior-year period. At around 66%, this remains at an excellent level, however. Following the above-average revenue growth in the prior-year quarter, TOM TAILOR Retail developed at a somewhat slower pace at the beginning of the year. This segment generated revenue of EUR 59 million, falling 0.6% short of the strong yearearlier figure. As expected, the TOM TAILOR Wholesale segment got off to a good start in 2015, boosting its first-quarter revenue by around 4% to nearly EUR 85 million. This improvement was mainly attributable to the expansion of the controlled selling spaces and also to the expansion of online activities. In March, for example, we signed a cooperation agreement with the online retailer Jabong that will benefit 05

Letter to shareholders DIETER HOLZER Chief Executive Officer/CEO us over the course of the year. This means we are now represented in the fast-growing Indian market as well. Nevertheless, we expect the momentum in the Wholesale segment to taper off in subsequent quarters. After this start to the year, we are essentially optimistic about the coming months even though our operating result was down on the previous year. Our company s positive development on the whole reinforces our determination to pursue our strategic and operational measures with renewed vigour. With our new organisational structure, which will strengthen our brands, we are creating ideal conditions for long-term profitable growth and a sustainable increase in the Company s enter-prise value. Yours sincerely, Dieter Holzer Hamburg, May 2015 06

highlights in Q1/2015 highlights in q1/2015 PARTNERSHIP WITH INDIAN ONLINE RETAILER JaBONG March 2015 The TOM TAILOR GROUP entered into a partnership with Indian online retailer Jabong, thanks to which sales of the TOM TAILOR brand began in India in March. The fashion and lifestyle group took this step to further expand its international e-commerce business and extend its reach in one of the world s most attractive and promising markets for online retail. The initially three-year partnership encompasses sales of clothing from the TOM TAILOR brand family and accessories on the Jabong.com online platform. Jabong is part of the Rocket Internet Group and one of the leading online retailers in India, generating double-digit growth rates annually. With this new partnership, TOM TAILOR brands are now sold online in 21 countries. 07

highlights in Q1/2015 NEW ORGANISATIONAL STRUCTURE FOR accelerated Verticalisation March 2015 The TOM TAILOR GROUP has introduced a new organisational structure to further boost the Group s long-term competitiveness by accelerating verticalisation. Effective 1 April 2015, a second management level below the Management Board with six vice presidents was introduced. Each vice president is responsible for a single brand across all sales channels. This move enables the Company to more specifically develop the value proposition of each brand and align it more consistently with customer requirements. TOM TAILOR s Wholesale and Retail sales segments were merged under the newly created position of Vice President Global Sales. This allowed important Group-wide interfaces to be consolidated and the efficiency of processes to be increased with immediate effect, thus building the foundation for further growth. The Group also introduced the new position of Vice President Digitalization to optimally leverage continued digitisation to benefit sales. The position is expected to be filled in the coming months. As a result of the launch of the new organisational structure, Dr Marc Schumacher (37), who had been Chief Retail Officer since 2010, left TOM TAILOR Holding AG s Management Board of his own accord as at 30 April 2015. Daniel Peterburs (35), who had served as Chief Product Development and Procurement Officer (CPO) to date, will manage the transition in his new function as Vice President of TOM TAILOR CONTEMPORARY and TOM TAILOR POLO TEAM. 08

TOM TAILOR on the Capital Market Shares and Investor Relations TOM TAILOR on the Capital Market Shares and Investor Relations TOM TAILOR Shares The performance of the German DAX index was very good in the first quarter of 2015 due to positive economic data and corporate earnings numbers. It was also spurred by the expansive monetary policy of the ECB, which in March began the most extensive bond-buying programme in European history. At the beginning of the year, the index stood at 9,765 points, reaching a new all-time high of 12,168 points on 16 March 2015. At the close of trading on the last day of March 2015, the DAX was at 11,966 points, having gained 22% in three months. The price of TOM TAILOR S shares moved sideways in the first quarter of 2015, starting 2015 at EUR 11.96. On 3 February, the TOM TAILOR GROUP reported that it would hit 2014 earnings targets, news that was received favourably by the capital markets. As a result, the share price rose to its highest level during the period under review: EUR 13.97 on 9 March 2015. In contrast, the muted forecast for financial year 2015 made public at the analysts conference on 18 March did not meet market expectations, causing TOM TAILOR s share price to fall. TOM TAILOR finished the first quarter with a share price of EUR 11.77, a decline of around 2% from the price at the end of December 2014. In contrast, the SDAX was able to gain some 17% during the same period. The market capitalisation of TOM TAILOR s shares amounted to EUR 306.3 million as at 31 March 2015 and an average of around 129,478 shares were traded daily on all German stock exchanges. Performance of the Tom Tailor Share in from 1 January to 31 March 2015 25% SDAX 20% 15% 10% 5% 0% TOM TAILOR share 5% 10% 15% Jan. Feb. Mar. 09

TOM TAILOR on the Capital Market Shares and Investor Relations Key Data on TOM TAILOR Shares Class of shares ISIN WKN (German securities ID number) Ticker symbol Index Stock markets Most important trading venue Designated sponsor No-par-value registered shares DE000A0STST2 A0STST TTI SDAX (Prime Standard) Frankfurt and Hamburg Xetra (electronic trading system) Berenberg Bank Commerzbank AG Investor Relations The TOM TAILOR GROUP s investor relations activities aim to raise awareness of the Group worldwide and to cement and expand the perception of TOM TAILOR s shares as an attractive growth stock. The TOM TAILOR Group continuously communicates its operating performance and strategic orientation in a timely, open manner with the objective of strengthening investors trust in the shares and achieving a realistic and fair valuation for TOM TAILOR s shares on the capital market. Investor relations activities in the first quarter of 2015 focused on the analysts conference for the 2014 financial year. On 18 March 2015, the Management Board gave a detailed report on the financial year ended, the expectations for 2015 as well as the Company s strategic focus to around 20 analysts and investors. The Management Board extensively discussed the business performance of BONITA and the Company s numerous operational and strategic development projects. In the first quarter of 2015, the Management Board and the Investor Relations team also visited many investors in Germany, Europe and the United States. Thirteen international investment firms regularly publish reports and commentary on the current performance of the TOM TAILOR GROUP and are making recommendations (research coverage). Five analysts have issued buy recommendations and seven hold recommendations for the Company s shares. One investment house recommends selling TOM TAILOR shares. 10

interim management report 12 Fundamental Information about the Group 12 Organisational Structure and Business Operations 14 Strategy and Performance Measurement 15 Report on Economic Position 15 Macroeconomic and Sector-Specific Environment 16 Results of Operations, Financial Position and Net Assets 24 Employees 25 Risks and Opportunities 25 Report on Post-Balance sheet Date Events 26 Report on Expected Developments 26 Outlook Economic Environment and Sector Developments 27 Expected Course of Business 28 Expected Development of the Group s Position 29 Overall Assessment of Expected Developments by the Management Board

interim management report Fundamental Information about the Group Fundamental Information about the Group Consolidated revenue up 3.4% to EUR 215.7 million BONITA records revenue growth of 5.8% to EUR 72.4 million and increase in earnings Gross margin up EUR 0.5 million to EUR 119.3 million (gross margin: 55.3%); Recurring EBITDA down EUR 2.0 million to EUR 9.1 million, net income for the period at previous year s level Net debt reduced by EUR 5.7 million to EUR 232.0 million Operating cash flow up EUR 3.4 million ORGANISATIONAL STRUCTURE AND BUSINESS OPERATIONS Lean Management Structure for Effective Management The TOM TAILOR GROUP is managed by Hamburg-based TOM TAILOR Holding AG, which is mainly responsible for the Group s strategic focus and development, corporate financing, risk management, fundamental decisions relating to product development, internal and external communications and maintaining contacts to the capital markets and the shareholders. The TOM TAILOR GROUP is headed by a management team with many years experience in the sector and the market, led by the Management Board. The respective subsidiaries run the operating business based on clearly defined revenue and earnings responsibilities. Clear Brand Positioning and International Presence The TOM TAILOR GROUP is an international, vertically integrated fashion and lifestyle company with a clear positioning as a supplier of casual wear in the mid-range price segment. Its product portfolio is complemented by an extensive range of fashionable accessories. The Company concentrates on the TOM TAILOR brand family and the BONITA brand in different segments of the fashion market (age groups of the target customers). Germany has traditionally been the regional focus of the business of what is now the TOM TAILOR GROUP, established in Hamburg in 1962. However, for several years the Company has been pursuing a successful strategy of conscious international growth. The Company now generates more than one-third of consolidated revenue outside Germany. Its international core regions are the stable, high-income economies of Austria, Switzerland, the Netherlands, Belgium and France. The Group also has a presence in Poland as well as in selected fast-growing countries of South Eastern Europe. Including other countries, the TOM TAILOR GROUP is represented internationally in over 35 countries. There were no significant changes to TOM TAILOR Holding AG s Group structure in the first quarter of 2015. Overall, the consolidated Group comprises 41 directly and indirectly held subsidiaries. Effective 1 January 2015, Tom Tailor GmbH increased its equity interest in TOM TAILOR Sourcing Limited from 63% to 75%, as planned. Management of the business is based on an overarching analysis of the various sales channels and brands. Correspondingly, the Group s segment reporting is divided into wholesale and retail. The Wholesale segment is comprised exclusively of the business with resellers for the TOM TAILOR brand, whereas the BONITA brand focuses exclusively on the retail business. The Retail segment in turn comprises the various forms of the brick-and-mortar retail business and the online business, with a distinction being made between the TOM TAILOR and BONITA brands. 12

interim management report Fundamental Information about the Group Proven Business Model of the Flexible Trend Manager The TOM TAILOR GROUP operates in an attractive, internationally very dynamic and heterogeneous market environment that is highly competitive. Its success factors are brand strength, flexibility and the ability to identify and satisfy short-lived fashion trends and the frequently changing wishes of customers in due time. The Group s business model is based on proximity to the market and to customers. As a basic principle, the TOM TAILOR GROUP does not set any trends with its collections but sees itself as a trend manager that focuses on successful trends and on its customers needs. Vertical integration with a strong presence in wholesale and retail gives the TOM TAILOR GROUP quick access to relevant market information. Daily sales analyses for the controlled selling spaces allow the TOM TAILOR GROUP to flexibly tailor its offering to its customers requirements, and thus actively manage sales, lowering sales risks, increasing space productivity and reducing write-downs of unsold goods. This business model has enabled the TOM TAILOR GROUP to achieve continual growth. Well-Positioned Brands in Complementary Market Segments In its core business, the TOM TAILOR brand is addresses men and women aged 25 to 40. In addition, the product range includes clothing for teenagers, children and babies. The TOM TAILOR brand s market presence is determined by the collections for the four brands TOM TAILOR, TOM TAILOR Denim, TOM TAILOR POLO TEAM and TOM TAILOR CONTEMPORARY that are designed individually for each of the product lines. TOM TAILOR releases 14 collections a year (12 monthly collections and two basic collections every six months) for the TOM TAILOR, TOM TAILOR Denim and TOM TAILOR CONTEMPO- RARY brands, and ten collections a year for the TOM TAILOR POLO TEAM brand. The fashion and lifestyle group sells these collections via its Retail segment (through Company-owned stores and e-commerce) and via its Wholesale segment (primarily through franchise stores and shop-in-shops). The BONITA brand has a separate profile and caters to both women and men over 40, ideally complementing the range of TOM TAILOR collections and product lines. BONITA sells 12 collections per year. The BONITA products are sold exclusively in BONITA s own stores and via its own e-shop using a highly standardised system. For detailed information on the individual brands and the Company s multi-brand approach please see the TOM TAILOR GROUP s 2014 Annual Report starting on page 18. Efficient Value Chain The Company s vertical alignment and its ability to rapidly record changing customer needs form the basis for successful development of the TOM TAILOR GROUP in the long term. This requires systematic monitoring and flexible management of the entire value chain from the idea for the design through purchasing and product manufacture, warehousing and logistics down to marketing at the point of sale. The different links in the value chain and the entire flow of goods are interconnected. The network of production and logistics partners is effective and allows rapid implementation, for instance in connection with changing trends and new collections. The value chain is explained in the TOM TAILOR GROUP s 2014 Annual Report starting on page 20. 13

interim management report Fundamental Information about the Group STRATEGY AND PERFORMANCE MEASUREMENT Clear Strategy of Profitability-driven Growth The Group follows a clear strategy of profitability-driven growth. The TOM TAILOR GROUP aims to outperform the indus- try as a whole in terms of revenue and operating profit growth. The aims here include increasing operating margins, boosting operating profit in absolute terms and achieving positive free cash flow. In addition, the Company is constantly striving to generate a net profit. The core elements of the long-term corporate strategy are: Systematic multi-brand approach in complementary segments Clear focus on organic growth, supported in the medium term with selected acquisitions Generating Growth by reproducing the existing successful business model Growth through internationalisation, especially by raising the Company s profile in core markets Generating growth by adding additional controlled selling spaces and expanding e-commerce Systematically increasing profitability, e.g. by con- tinually optimising the Company s own network of stores, improving the efficiency of the space used (sales per m²) and streamlining procurement Additional information on the corporate strategy is available in the TOM TAILOR GROUP s 2014 Annual Report starting on page 22. brands, the TOM TAILOR GROUP aims to even better leverage the potential of its brands to further reinforce its long-term competitiveness. In addition, the TOM TAILOR GROUP intends to take advantage of the currently favourable capital market environment to refinance its liabilities to create financing options for the medium term. Management Based on Financial and Non-financial Key Performance Indicators and Leading Indicators The internal management system used within the TOM TAILOR GROUP goes beyond a pure KPI (key performance indicator) system. It offers a comprehensive overview of financial and non-financial factors. In addition, leading indicators are monitored and evaluated. A variety of reporting systems are used at the TOM TAILOR GROUP to measure financial key performance indicators. These are differentiated at the level of both the overall Group and by segment. The main financial key performance indicators are revenue, EBITDA and the EBITDA margin (broken down to the level of the individual stores). In addition, figures such as net debt, the equity ratio, working capital and various inventory turn over ratios are monitored at Group level. In the Wholesale segment, the ratio of pre-orders to orders received is also used. The TOM TAILOR GROUP also measures a range of non-financial factors that provide information about how the Company is perceived. Both external surveys (especially the brand survey performed by the German magazine DER SPIEGEL once every two years) and internal studies (for example, customer surveys in the Wholesale segment, or trends in social networks such as Facebook) are used. Key Strategic Issues in 2015: Profitability, Accelerated Verticalisation, Refinancing After the successful return to profitability in the past year, the TOM TAILOR GROUP continues to work toward profitable growth in 2015 with a focus on accelerating the verticalisation of the Company. By increasing efficiency in the individual TOM TAILOR s Management Board pays particular attention to analysing leading indicators, in particular incoming orders, cotton price trends, the USD/EUR exchange rate, the gross margin generated per purchase and like-for-like sales in Company-owned stores. Various key performance indicators are also evaluated at store level, such as the conversion rate and the personnel expenses per store. In addition, regular benchmark comparisons are made with the performance of relevant competitors. 14

interim management report Report on Economic Position Report on Economic Position MACROECONOMIC AND SECTOR-SPECIFIC ENVIRONMENT Regionally Contradictory Trends in the Global Economy Low Oil Price Stimulates Economy in Industrialised Countries In early 2015, the global economy grew further despite unresolved geopolitical conflicts, primarily due to a continued upturn in the industrialised countries. As expected, emerging economies saw economic growth slow further. In the industrialised nations, the economy was bolstered by consumer expenditure above all. This was the result of low interest rates and oil prices, and in some cases, rising employment rates. In the euro zone, the moderate upswing in the economy felt recently continued into early 2015. The Ifo Institute estimates that the currency union s economy grew by 1.0% year-onyear in the first quarter (up 0.4% from the previous quarter). According to the Statistical Office of the European Union (Eurostat), the euro zone s seasonally adjusted unemployment rate fell to 11.3% in March (previous month: 11.7%), while consumer prices in the first quarter of 2015 were lower year-onyear the preliminary annual rate was -0.1% in March. The GfK consumer confidence index for Europe (EU 28) rose in March by 4.3 points to 9.8 points, its highest level since 2008. Private Consumption Gains Momentum in the Core Markets of the TOM tailor GROUP Switzerland s economy is under considerable pressure due to the strong appreciation of the franc. Leading economic researchers at the KOF Swiss Economic Institute believe the economy there shrank by 0.5% in the first quarter of 2015, although consumption was up an estimated 2.4%, remaining untouched by this development. Economic output in Austria stagnated in early 2015, according to the central bank (OeNB), with the leading OeNB economic indicator in March signalling a slight improvement. In the first quarter, the GDP apparently rose 0.3% year-on-year with a moderate increase in employment numbers. The French and Belgian economies continued to experience and the economy of the Netherlands returned to solid growth of around 1% and more as compared with the previous year. Among the Eastern and South-Eastern European markets relevant to the Company, Poland, Slovenia and Romania stood out as countries whose economies are growing faster than the EU average. Only in Serbia and Croatia, which were in recession in 2014, did the situation remain difficult. Germany s economy is on a strong upswing, say leading research institutions in their Joint Economic Forecast for spring 2015. This stems from factors including the unexpectedly expansive effect of the drop in oil prices and the decline in the value of the euro. These researchers estimate that, in the first quarter, Germany s GDP grew sequentially (i.e. over the previous quarter) by 0.6% in real terms (Q4: +0.7%). In addition, consumer expenditure is expected to have made an aboveaverage contribution to this development, growing 0.9% (Q4: +0.8%) driven by rising buying power, the positive labour market situation and higher wages and pensions. The number of employed persons rose year-on-year in March by 238,000 to 42.5 million people (+0.6%), while the seasonally adjusted unemployment rate declined to 4.7% (prior-year month: 5.0%). At the same time, price trends in Germany remained muted, with price pressure decreasing noticeably due to falling energy prices. In March, the annual inflation rate was +0.3% (adjusted for energy: +1.0%). The prices of clothing and shoes rose moderately by an average of 0.6%. According to the GfK consumer confidence index, German consumers were again more optimistic in this environment. In the first quarter, the GfK consumer confidence index continued to rise; this indicator was up 1.4 points within a year to 9.7 points in March. Economic and earnings expectations both improved, as did the propensity to buy. 15

interim management report Report on Economic Position No Benefit Yet for Fashion Business from Positive Consumer and Retail Climate According to Eurostat, the changes in deflated retail sales in the euro area were positive on the whole. This figure rose year- on-year by 2.8% in January and February and by 1.6% in March. Growth was highest in mail-order and online retail sales. The sub-index for textiles, clothing and footwear (brick-and-mortar stores) also rose year-on-year (January: +1.1%, February: +3.2%), although by less than retail sales as a whole. In the Company s core regions, the volume of retail sales in Poland grew fastest, but growth in sales in Bulgaria, the Netherlands and France was also disproportionately high. Whereas more moderate, but still solid, growth rates were achieved in Austria and Belgium, the retail sector in Switzerland stagnated. In the first quarter, the Federal Statistical Office (Destatis) calculates that retail sales in Germany (excluding vehicles and petrol stations) rose by 3.1% in nominal terms and by 3.6% in real terms. However, the picture in individual segments differed substantially. Online and mail-order sales continued to expand dynamically, up 6.6% in nominal terms and 7.2% in real terms. Destatis also reports that German imports of clothing and clothing accessories grew comparatively moderately in early 2015 (January: nominal increase of 2.8%). Likewise, figures released by Destatis show that German retail sales of textiles, clothing, shoes and leather goods were up by just 1.7% in nominal terms in the first quarter. In real terms, this was an increase of only 1.5%. The results of the German Retail Federation s (HDE) spring 2015 economic survey were similarly restrained with regard to clothing sales. Companies mostly described their situation as unsatisfactory in this survey. RESULTS OF OPERATIONS, FINANCIAL POSITION AND NET ASSETS RESULTS OF OPERATIONS Consolidated Revenue up 3.4% The TOM TAILOR GROUP grew revenue by a total of 3.4% to EUR 215.7 million in the first three months of financial year 2015 (2014: EUR 208.7 million). This increase is due to the positive trend in retail revenue at BONITA as well as the growth of the TOM TAILOR GROUP s Wholesale segment. The total retail revenue of the TOM TAILOR GROUP climbed by 2.9% to EUR 131.3 million in the first quarter of 2015 (2014: EUR 127.6 million), whereas revenue in the Wholesale segment was up 4.2% to EUR 84.5 million in the same period (2014: EUR 81.1 million). BONITA especially made a contribution to the positive retail revenue trend. Compared with the prior-year quarter, revenue rose by 5.8% to EUR 72.4 million in the first quarter of 2015 (2014: EUR 68.4 million). In contrast, the revenue of the TOM TAILOR Retail segment decreased slightly by 0.6% to EUR 58.9 million during the same period (2014: EUR 59.2 million). In Germany, the TOM TAILOR GROUP s revenue rose by 5.3% to EUR 137.0 million in the first quarter (2014: EUR 130.1 million). BONITA saw an increase of 8.8% to EUR 51.6 million (2014: EUR 47.4 million), whereas the two TOM TAILOR segments improved by 3.3% million, reaching a total of EUR 85.4 million (2014: EUR 82.7 million). Compared with the prior-year quarter, the TOM TAILOR GROUP s revenue outside Germany was almost stable at EUR 78.7 million (2014: EUR 78.6 million). The international share of revenue declined to 36.5% (2014: 37.7%). Revenue abroad in the first quarter of 2015 was driven mainly by international core markets such Austria, Switzerland and the Benelux countries. In the core international markets, the revenue of the TOM TAILOR GROUP (including BONITA) grew by 7.4% to EUR 53.5 million (2014: EUR 49.8 million). In line with revenue growth in Germany, BONITA s revenue in the core international markets also rose by 11.0% to EUR 19.2 million (2014: EUR 17.3 million). 16

interim management report Report on Economic Position Revenue by Segment EUR million Q1/2015 Q1/2014 Q1/2013 TOM TAILOR Wholesale 84.5 81.1 75.4 TOM TAILOR Retail 58.9 59.2 48.4 BONITA 72.4 68.4 73.0 TOM TAILOR GROUP 215.7 208.7 196.8 Gross Profit up Slightly on Previous Year - Gross Margin down 1.6 Percentage Points to 55.3% The cost of materials rose by 7.3% during the period under review to EUR 96.5 million (2014: EUR 89.9 million). Taking into account revenue growth, gross profit increased slightly by EUR 0.5 million in absolute terms to EUR 119.3 million in the reporting period (2014: EUR 118.8 million). Compared with the prior-year quarter, the gross margin declined from 56.9% to 55.3% in the first quarter of 2015. Revenue by Region EUR million Q1/2015 Q1/2014 Q1/2013 Germany 137.0 130.1 128.8 International markets 78.7 78.6 68.0 TOM TAILOR GROUP 215.7 208.7 196.8 The decrease in the gross margin during the period under review is chiefly due to a lower gross margin in the BONITA segment. This figure was down 3.7 percentage points to 65.6% in the first quarter of 2015 (2014: 69.3%). Seasonally typical price promotions at the beginning of the year, which were somewhat higher than in the previous year, are the main reason for this decrease. Other Operating Income Rises to EUR 10.0 million Other operating income was up from EUR 6.2 million in the prior-year quarter to EUR 10.0 million in the first quarter of 2015. This increase was mainly due to higher foreign exchange gains from currency translation, which stood in contrast to approximately equal losses from foreign currency translation recognised in other operating expenses. Another material item in other operating income is royalties, which were up around 22% to EUR 1.9 million as against the prior-year quarter (2014: EUR 1.6 million). In the quarter under review, this item additionally included income of EUR 1.1 million from subletting space leased by the Group (2014: EUR 0.9 million). Personnel Expense to Revenue Ratio Drops to 23.2% Personnel expenses rose slightly by 1.4% to EUR 50.0 million in the first three months of 2015 (2014: EUR 49.3 million). The personnel expense to revenue ratio declined from 23.6% to 23.2% in the first quarter of 2015. The absolute increase was mainly the result of the slightly higher average number of employees in the TOM TAILOR Group. The TOM TAILOR GROUP employed 6,537 people as at 31 March 2015 (previous year: 6,527). 17

interim management report Report on Economic Position Other Operating Expenses Increase by 8.7% Other operating expenses rose by 8.7% over the prior-year period to EUR 71.4 million (2014: EUR 65.7 million). This increase was mainly due to foreign exchange losses from currency translation, which stood in contrast to approximately equal foreign exchange gains recognised under other operating income as well as increased rent, freight and logistics costs. The key items in other operating expenses are rent of EUR 31.7 million (2014: EUR 31.2 million), logistics costs for order picking of EUR 6.3 million (2014: EUR 5.6 million), marketing expenses of EUR 6.3 million (2014: EUR 6.1 million) and freight costs of EUR 2.8 million (2014: EUR 2.4 million). Recurring Earnings before Interest, Taxes, Depreciation and Amortisation (EBITDA) down EUR 2.0 million from Previous Year Recurring Earnings before Interest, Taxes, Depreciation and Amortisation (EBITDA) Q1/2015 Q1/2014 Q1/2013 Recurring EBITDA (in EUR million) 9.1 11.1 9.9 Recurring EBITDA margin (in %) 4.2 5.3 5.0 Reported EBITDA was down EUR 2.1 million from the 2014 figure to EUR 7.8 million in the first three months of the reporting year (2014: EUR 9.9 million). In the first quarter of 2015, one-off expenses remained at the previous year s level, totalling EUR 1.3 million (2014: EUR 1.2 million). Depreciation and Amortisation down EUR 1.1 million Depreciation and amortisation decreased by EUR 1.1 million in the first quarter of 2015 to EUR 11.9 million (2014: EUR 13.1 million). Depreciation and amortisation in the reporting period contrasted with capital expenditure of EUR 7.6 million (2014: EUR 4.1 million). The decrease in depreciation and amortisation is primarily attributable to the BONITA segment, in which depreciation and amortisation declined by EUR 1.0 million in the first quarter of 2015 compared with the prior-year period. The main reason for this decline was an extension of the useful life of the ERP software in 2014. Financial Result up 17.4% The financial result in the first quarter of 2015 amounted to EUR 3.5 million, an improvement of 17.4% from the previous year (2014: EUR 4.2 million). This was largely due to a lower EURIBOR rate and a decline in net debt compared with the prior-year period. Recurring EBITDA decreased by EUR 2.0 million to EUR 9.1 million in the first quarter of 2015 (2014: EUR 11.1 million). In particular, the decline compared with the previous year was due to higher other operating expenses. Income Taxes at EUR 0.7 million As in the prior-year quarter, income taxes remained unchanged at EUR 0.7 million in the first quarter of 2015. The resulting tax rate of 9.1% was slightly below last year s level (2014: 9.3%). 18

interim management report Report on Economic Position Reported Net Income for the Period and Earnings per Share at Previous Year s Level Recurring net income for the first three months of 2015 was generally on a level with the previous year at EUR 4.0 million (2014: EUR 3.8 million). Accordingly, the recurring earnings per share (EPS) amounted to EUR 0.19 (2014: EUR 0.18). At EUR 6.9 million, the net loss reported for the period was also comparable to the previous year (2014: EUR 6.7 million) and led to earnings per share of EUR 0.30 (2014: EUR 0.29). Reconciliation to Recurring Net income for the Period EUR thousand Q1/2015 Q1/2014 Net income for the period 6,923 6,721 Income taxes 693 693 Net income before income tax 7,616 7,414 Financial result 3,510 4,251 One-off items/special factors of which in depreciation, amortisation and impairment losses: Amortisation from TOM TAILOR (PPA) from 2005 Amortisation from Bonita (PPA) from 2012 1,174 1,120 1,174 1,120 of which in financial result: Financing costs/bonita acquisition 640 669 of which in EBITDA: Cost of Bonita integration Other one-off items/special factors 0 1,260 663 500 1,260 1,163 Aggregate one-off items/special factors, net of tax effect 4,194 4,126 Recurring EBIT 552 294 as % of revenue 0.3% 0.1% Depreciation, amortisation and impairment losses (net of amortisation from PPA) 9,648 10,782 Recurring EBITDA 9,096 11,076 as % of revenue 4.2% 5.3% Depreciation, amortisation and impairment losses (net of amortisation from PPA) 9,648 10,782 Financial result (net of one-off items/special factors) 2,870 3,582 Recurring net income before income tax 3,422 3,288 Income taxes 693 693 Imputed tax effect (30%) on aggregate one-off items/special factors 1,258 1,238 Recurring net income for the period 3,987 3,833 Recurring earnings per share after deduction of minority interests (in EUR) 0.19 0.18 Earnings per share after deduction of minority interests (in EUR) 0.30 0.29 19

interim management report Report on Economic Position Segment Reporting Segment reporting in the TOM TAILOR GROUP is basically divided into the Retail and Wholesale segments. The Retail segment comprises the brick-and-mortar retail and outlet stores operated by the Group and its e-commerce activities. The latter consist of its own e-shops and e-commerce partnerships with mail-order companies. Following the acquisition of BONITA in 2012, reporting in the Retail segment was extended to include BONITA. As a result, a distinction is now made between the TOM TAILOR and BONITA umbrella brands. In the Wholesale segment, the Company distributes TOM TAILOR products to business customers, who sell these to end customers via different sales channels. These include franchise stores, shop-in-shops and multi-label sales outlets. There are a total of three reportable segments (TOM TAILOR Retail, TOM TAILOR Wholesale and BONITA). Retail Segments In the first three months of 2015, revenue in both Retail segments together rose by 2.9% to EUR 131.3 million (2014: EUR 127.6 million). The share of consolidated revenue accounted for by the Retail segment in the period under review declined slightly to 60.8% because of growth in the Wholesale segment (2014: 61.2%). Uneven Start to the Year for the TOM TAILOR Retail Segment TOM TAILOR Retail Segment Key Data In the first quarter of 2015, the TOM TAILOR Retail segment was unable to continue the very strong trend of the prioryear quarter and, with revenue at EUR 58.9 million, saw a mild decline of 0.6% from the previous year (2014: EUR 59.2 million). The weaker performance of the fourth quarter of 2014 continued in the TOM TAILOR Retail segment, although a clear upward trend could be discerned in March. However, this positive development could not fully compensate for the previous lower-revenue months. On a like-for-like basis (i.e. excluding expansion), revenue in the TOM TAILOR Retail segment was down by 4.6% as against the prior-year period in the first quarter of 2015 (2014: +9.6%) and was unable to decouple from the general industry trend. At 388, the number of retail stores rose by 29 since 31 March 2014 and by six since 31 December 2014. Of these, 154 retail stores are in Germany, 116 are in the core international markets and 118 are in other countries. In the first quarter of 2015, e-commerce revenue was also unable to match the performance of the prior-year quarter, declining by 3.6% to EUR 10.8 million (2014: EUR 11.1 million). Recurring EBITDA in the TOM TAILOR Retail segment fell by EUR 2.3 million to EUR 1.3 million in the first three months of 2015 (2014: EUR 1.0 million). This decrease stemmed mainly from the material increase in personnel and rent expenses in the course of adding further space. At 56.0%, the gross margin remained at the prior-year level in the first quarter of 2015 (2014: 55.9%). BONITA Retail Segment Increases Revenue by 7.4% on a Like-for-like Basis Q1/2015 Q1/2014 Revenue (EUR million) 58.9 59.2 Growth (in %) 0.6 22.3 On a like-for-like basis (in %) 4.6 + 9.6 Number of stores 388 359 Recurring EBITDA (EUR million) 1.3 1.0 Recurring EBITDA margin (in %) 2.2 1.7 Bonita Segment Key Data Q1/2015 Q1/2014 Revenue (EUR million) 72.4 68.4 Growth (in %) 5.8 6.3 On a like-for-like basis (in %) 7.4 8.7 Number of stores 1,014 1,010 Recurring EBITDA (EUR million) 0.2 0.3 Recurring EBITDA margin (in %) 0.3 0.4 20

interim management report Report on Economic Position The BONITA brand exclusively comprises its own retail stores and, since mid-2013, has also included e-commerce activities. In the first quarter of 2015, BONITA contributed EUR 72.4 million to consolidated revenue (2014: EUR 68.4 million). This corresponds to a share of 33.5% of consolidated revenue in the first three months of 2015 (2014: 32.8%). On the whole, revenue rose by 5.8% as against the prior-year period. The positive effects of the improvement of design and product quality, accelerated procurement times, and targeted promotions, especially in January 2015, had a material role to play in this development. On a like-for-like basis (i.e. excluding expansion), revenue increased by 7.4% year-on-year in the period under review (2014: 8.7%). The total number of BONITA stores was 1,014 as at 31 March 2015. Of these, 718 retail stores are in Germany, 290 are in the core international markets and six are in other countries. Recurring EBITDA increased to EUR 0.2 million in the first quarter of 2015, mainly due to reduced personnel expenses (2014: EUR 0.3 million). Reported EBITDA increased by EUR 1.2 million, also to EUR 0.2 million (2014: EUR 1.0 million). No one-off expenses were incurred at BONITA in the first quarter of 2015. The gross margin was down 3.7 percentage points to 65.6% in the first quarter of 2015 (2014: 69.3%). Seasonally typical price promotions at the beginning of the year, which were somewhat higher than in the previous year, are the main reason for this decrease. TOM TAILOR Wholesale Segment Increases Revenue by 4.2% TOM TAILOR Wholesale Segment Key Data Q1/2015 Q1/2014 Revenue (EUR million) 84.5 81.1 Growth (in %) 4.2 7.6 Number of shop-in-shops 2,722 2,329 Number of franchise stores 206 199 Recurring EBITDA (EUR million) 10.2 10.4 Recurring EBITDA margin (in %) 12.1 12.8 The revenue of the TOM TAILOR Wholesale segment increased by 4.2% in the first three months of 2015 to EUR 84.5 million (2014: EUR 81.1 million). The segment thus accounted for 39.2% of consolidated revenue (2014: 38.9%). In Germany, the Company increased Wholesale revenue by 5.3% to EUR 51.6 million (2014: EUR 49.0 million). Outside Germany, revenue increased by a total of 2.5% to EUR 32.9 million (2014: EUR 32.1 million). Since 31 December 2014, TOM TAILOR has further increased the number of its shop-in-shops by 36, from 2,686 to a total of 2,722. The number of franchise stores remains unchanged from 31 December 2014 at 206. Recurring EBITDA was EUR 10.2 million in the first three months of 2015, slightly below the prior-year level (2014: EUR 10.4 million). Despite a lower margin, the absolute gross profit figure was somewhat higher. This positive development stood in contrast with higher personnel expenses in particular. FINANCIAL POSITION Operating Cash Flow up EUR 3.4 million on Previous Year Development of key cash flow figures in Q1/2015 EUR million Q1/2015 Q1/2014 Operating cash flow 8.3 11.7 Change (in %) 29.2 7.3 Net cash used in investing activities 7.4 4.1 Free cash flow 17.4 17.1 Change (in %) 1.8 18.3 In the first quarter of 2015, net cash used in operations at the TOM TAILOR GROUP amounted to EUR 8.3 million, down EUR 3.4 million from the previous year (2014: EUR 11.7 million). The improvement in operating cash flow as against the prioryear quarter was attributable in particular to the decline in inventories since 31 December 2014. Conversely, operating cash flow in the prior-year quarter had been negatively affected by increased inventories. 21

interim management report Report on Economic Position Seasonal fluctuations in the fashion industry during the year generally result in reduced cash inflows from operations, and therefore lower net cash provided by operating activities, in the first three months of the year. This development is normal for this reporting period. In the first quarter of 2015, net cash used in investing activities totalled EUR 7.4 million, up EUR 3.3 million from the previous year (2014: EUR 4.1 million). This is largely due to the increased investments in new stores in the TOM TAILOR Retail and BONITA segments. Net cash provided by financing activities amounted to EUR 13.5 million (2014: EUR 9.8 million). This comprised the seasonal draw-down of existing bank lines of credit in connection with the Group s operating activities and the scheduled repayment of liabilities to banks (term loans) in the amount of EUR 7.5 million. In the first quarter of 2015, cash and cash equivalents declined by a total of EUR 3.5 million to EUR 33.5 million (Q1 2014: decline of EUR 7.3 million). Capital Expenditure up EUR 3.5 million A total of EUR 7.6 million was invested Group-wide in the first quarter of 2015 in all three segments, mainly in the further expansion of controlled selling spaces (2014: EUR 4.1 million). Of that amount, EUR 3.7 million was invested in the TOM TAILOR Retail segment (2014: EUR 1.4 million) and EUR 1.7 million in the TOM TAILOR Wholesale segment (2014: EUR 1.2 million). Capital expenditure in the TOM TAILOR Retail segment largely related to shop fittings and fixtures for new stores. Approximately EUR 1.1 million was spent on new selling spaces in the TOM TAILOR Wholesale segment. The remaining EUR 0.6 million mainly related to investments in showrooms and IT. In the first quarter of 2015, BONITA invested a total of EUR 2.2 million in new stores (2014: EUR 1.5 million). NET ASSETS Non-current Assets up EUR 1.9 million Non-current assets increased by EUR 1.9 million compared with 31 December 2014. Depreciation of property, plant and equipment and amortisation of intangible assets totalling EUR 11.9 million (2014: EUR 13.1 million) were contrasted with capital expenditure of EUR 7.6 million due to further expansion (2014: EUR 4.1 million). The resulting decline in intangible assets and property, plant and equipment was contrasted with a sharp increase in the fair values of long-term currency forwards, which is reflected in the rise in other noncurrent assets. In total, non-current assets amounted to EUR 489.3 million as at 31 March 2015 (31 December 2014: EUR 487.3 million). Net Working Capital Net working capital is calculated as the sum of inventories and trade receivables less trade payables at the reporting date. Net working capital rose by EUR 14.4 million to EUR 88.5 million as at 31 March 2015 (31 December 2014: EUR 74.1 million). This development was mainly the result of the EUR 15.6 million increase in trade receivables specific to the reporting date. The changes in inventories and trade payables compared with the figures as at 31 December 2014 were only minor. Inventories fell by EUR 1.5 million to EUR 164.2 million (31 December 2014: EUR 165.7 million), and trade payables remained almost the same at EUR 143.5 million (31 December 2014: EUR 143.8 million). Net working capital declined from the prior-year quarter by EUR 8.6 million (31 March 2014: EUR 97.1 million) due to higher trade payables in the reporting period. 22

interim management report Report on Economic Position Slight Decline in Equity Ratio Due to Net Loss for the Period Equity was slightly lower at EUR 237.4 million, mainly due to the net loss for the period of EUR 6.9 million in the first quarter of 2015 (31 December 2014: EUR 239.2 million). The equity ratio dropped marginally to 29.6% (31 December 2014: 30.3%). At the end of the prior-year quarter, the equity ratio was 28.7%. Seasonal Increase in Non-current Financial Liabilities by EUR 22.4 million On the liabilities side of the balance sheet, the non-current financial liabilities included in the non-current liabilities item increased by EUR 22.4 million to EUR 232.0 million (31 December 2014: EUR 209.6 million). The increase is attributable to higher drawdowns of long-term bank lines of credit as a result of seasonal factors. Compared with the first quarter of 2014, the non-current financial liabilities as at 31 March 2015 decreased by EUR 17.7 million (2014: EUR 249.7 million). Net debt as at 31 March 2015 was EUR 232.0 million and thus EUR 29.1 million higher than the 31 December 2014 figure of EUR 202.9 million. Compared with the first quarter of 2014, net debt fell by EUR 5.7 million (31 March 2014: EUR 237.6 million). Asset and Capital Structure in % 31 March 2015 31 March 2014 Non-current assets 61.0 66.2 Current assets 39.0 33.8 Equity 29.6 28.7 Non-current liabilities 41.8 44.9 Current liabilities 28.6 26.4 Off-Balance-Sheet Financing Instruments The Company does not use any off-balance-sheet financing instruments such as factoring, asset-backed securities, sale and leaseback transactions, or contingent liabilities involving special-purpose entities not included in the consolidated financial statements. The TOM TAILOR GROUP has a small number of other operating leases, for example for IT equipment and company vehicles. Off-balance-sheet financial instruments therefore do not have any material effect on the Group s net asset position. Selected Figures for Net Assets, Financial Position and Results of Operations EUR million 31 March 2015 31 March 2014 Equity 237.4 216.8 Non-current liabilities 335.2 339.5 Current liabilities 229.0 199.3 Financial liabilities 265.4 277.5 Cash funds 33.4 39.9 Net debt 232.0 237.6 Total assets 801.6 755.6 23