1

Combined general meeting as of 2nd June 2009

general assessment of the year 2008

Sales growth despite the crisis

A contrasted year
1st half : strong growth in sales and results 2nd half : slowdown

Growth rate Sales Current operating profit

1st half

2nd half

Total

+ 12.8 % + 14.1 %

+ 5.2 % + 4.0 %

8.6 % 8.4 %

general assessment of the year 2008

2008 : a contrasted year

From strong to average growth From weak to strong dollar and yen Currencies which have modified travel flows Currency effect which have brought sometimes dissuassive price increases

general assessment of the year 2008

Long term strategy has been maintained :

Confirmation of a consistent style permanently reinvented A seducing creation and a permanent offer renewal Vision of a Herms craftsman

general assessment of the year 2008

Our most legitimate product lines have well progressed
Distribution via the Herms exclusive network Leathergoods & Saddlery Silk & Textiles Ready-to-wear & Fashion accessories Other Herms Sectors Distribution via specialised outlets Perfumes Tableware Watches
Proforma changes at constant rates 2008/2007

+ 11 % + 14 % + 11 % + 10 % -5% -2% +6% -4% -9%

5

general assessment of the year 2008

Success

Our difference expressed though our stores and our rich offer China, USA, Europe, France Extension of our network has been pursued Geographical balance strategy

general assessment of the year 2008

Strong developpment of our presence in Mainland China As at end of 2008 :
11 branches 3 concessionaries

2008 turnover : 47 M i.e. 3 % of the group total, and 1/7e of Japan Strong growth : + 80 % in 2008 / 2007 after + 90 % in 2007/2006 Target to maintain a strong growth, with a yearly pace of 2 stores openings
7

general assessment of the year 2008

Success

Service improvement has been maintained Luxury Institute : Herms n 1 All staff stick to the corporate project, and possibility for all to participate Reactivity being renforced through an increased delegation and decentralization

general assessment of the year 2008

Further improvements

Japan : slight decrease, due to the crisis, recession, demography and currencies Watches : rescheduling of our network in Japan Growth relays making a break, after several successful years

general assessment of the year 2008

Information by Sectors 2008 / 2007
Silk & Textiles 12 % 12 %

10

Ready-to-wear & Fashion accessories 19 % 19 %

Leathergoods & Saddlery 43 % 42 %

Perfumes 7% 7% Watches 5% 7% Tableware 3% 3%

Other Products 6% 5%

Other Herms sectors 5% 5%

10

general assessment of the year 2008

Achievements

11

Developpment of new activities

Herms Intrieur & Design joint-venture with Wally acquisition of 10 % in Jean Paul Gaultier bringing our participation to 45 %

11

general assessment of the year 2008

Achievements

12

Creation of the Herms corporate Foundation

12

general assessment of the year 2008

Achievements

13

Support to the creation of young European designers

1st edition : la lgret au quotidien

13

general assessment of the year 2008

Achievements

14

Improvement of the supply chain being pursued :

start in August 2009

Launching of the web site Les ailes dHerms :

more than 250 000 visitors per month

14

2008 : environment

15

Reminder of our targets related to the environment :

To minimize the use of natural resources To adequate utilization of raw materials Control of quantitative and qualitative material rejections

15

2008 : environment
Achievement :

16

Since 2002, water consumption has decreased by 40% at constant perimeter (*), as the increase of our industrial activity has been similar to that of the group.
In m3
600 000

Evolution of water consumption

500 000

400 000

300 000

200 000

100 000

0 2002

2003

2004

2005

2006

2007

2008

(*) excluding consumption of the 3 Soficuir tanneries since 2007

16

general assessment of the year 2008

17

Growth in sales and steadiness of the current operating margin at 25.5% of sales
Current rates

Constant rates

Turnover Current operating income Net result

+ 8.6 % + 8.4 % + 0.8 %

+ 10.2 % + 17.0 % + 9.0 %

17

general assessment of the year 2008

Evolution of the current operating profit
Operating improvement

18

449 M
Current operating profit 2008

+ 70 415 M
Current operating profit 2007 Currency effect

- 36

18

general assessment of the year 2008

Financial strength

19

Equity Net cash Operating margin

1 605 M 450 M 25.5 %

19

2008 : creation

20

Inspiration Ideas Skills Passion

Researc h Know-how

Innovation Industry

Craftsmanship
20

2008 : innovation

21

Herms Editor : Josef Albers scarf Bugatti Veyron Fbg Cape Cod Great Hours

21

2008 : meetings & talents

22

20 years of Men ready-to-wear Storytellers on Silk Un Jardin aprs la Mousson

22

2008 : growth in all regions except Japan

23

Activity by geographical areas

Changes at constant rates Japan France Europe (excl. France) Americas Asia-Pacific (excl. Japan) - 3% + 10 % + 12 % + 15 % + 22 %

23

2008 : balanced sales by geographical zones breakdown of sales 2008 / 2007

24

Japan

22 % 24 %
Asia-Pacific
(excl

Others (1) 3% 3%

Japan)

France

18 % 17 %

20 % 20 %
Europe
(excl

Americas

France)

15 % 15 %

22 % 21 %

( 1)

Including sales to airline companies

24

25 2008 : the pace of new stores remains sustained

12 new branches 10 new concessionaries 13 refurbishments and enlargements of branches

25

26 2008 : the pace of stores creations remains sustained

267 286

237

246

252

104

110

107

111

121

133

136

145

156

165

2004

2005
Branches

2006

2007

2008

Concessionaries
26

27

Human Resources

27

2008 : human resources

Many job creations :

28

439 new employees in 2008 Headcount amounted to 7 894 as at end of 2008

28

2008 : human resources

Job creations have continued in 2008
7 894 7 455 6 825 5 361 4 642 4 150 4 272 4 943 5 594 5 871 6 150

29

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007 2008

29

2008 : human resources

Balance production / sales workforce

30

Support 17 % Sales 38 % Production 45 %

30

2008 : human resources

Herms Manufactures

31

31

2008 : human resources

Two third of workforce in France
Americas 7% Japan 9% Asia-Pacific
(excl Japan)

32

Europe
(excl France)

10 %

11 %

France
(primarily production 42 %)

63 %

Women : 67 % Men : 33 %
32

33

Presentation of consolidated statements

33

2008 : consolidated statements

In millions of euros Turnover Gross profit Administrative & commercial expenses Other income & expenses Current operating income 2008 1765 1140 - 612 - 79 449 2007 1625 1055 - 570 - 70 415

3 4

34

2008 : consolidated statements

In millions of euros Current operating income Non current other income & expenses Operating income Net financial income Corporate income tax Share of net income of associates Minority interests Net income groups share 449 18 - 160 - 11 -5 290 2008 449 2007 415 +9 424 12 - 144 2 -6 288

3 5

35

2008 : consolidated statements

Investments
In millions of euros Distribution Production Financial investments Others Total investments*
*excluding financial placements

36

2008 88 27 5 40 160

36

2008 : consolidated statements

Cash flow
In millions of euros
357 292 273 242 221 162 125 259 306 322

37
379

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007 2008
37

2008 : consolidated statements

Cash flow statement
In millions of euros Cash flow from operations Investments Change in operating working capital Dividends Share buybacks Others Change in net cash position 2008 379 - 160 - 81 - 111 - 51 -6 - 30

38

38

2008 : consolidated statements

Shareholdersequity and net cash
In millions of euros

39
Shareholdersequity before appropriation Net cash

1 475

1 605

480

450

2007

2008
39

2008 : consolidated statements

Simplified consolidated balance sheet
As at 31st Decembre, in millions of euros

40

Assets
Non current assets Inventories Other current assets Cash & cash equivalents Total

2008 998.0 523.6 320.5 485.8 2327.9

2007 844.5 432.1 258.6 529.9 2065.1

40

2008 : consolidated statements

Simplified consolidated balance sheet
As at 31st Decembre, in millions of euros

41

Liabilities & Shareholdersequity

Shareholdersequity before appropriation Provisions Other liabilities Total

2008 1604.8 69.7 653.4 2327.9

2007 1475.1 60.4 529.6 2065.1

41

42

Presentation of main resolutions

42

Presentation of main resolutions

Resolutions on ordinary business

43

Direction fees and remuneration of the Supervisory Board (6 e)

Maximum total amount increased to 282 000 Including remunerations to the committees members Including a variable portion based on presence

43

Presentation of main resolutions

Resolutions on ordinary and extraordinary business

44

Share buyback program (7 e)

Authorisation up to 10 % of the capital Maximum amount of funds to be committed : 750 millions deuros Purpose : ensuring the liquidity through a contract, cancelling, transfering, alloting to employees and stock options Maximum purchase price : 200 euros Term : 18 months

Authorisation to cancel shares (9e )

Authorisation up to 10 % of the capital Term : 24 months

44

Presentation of main resolutions

Resolutions on extraordinary business

45

Delegations of authority to the Executive Management to carry out capital increase (10e 12e)

Common ceiling to 20 % of the capital Term : 26 months

Delegations of authority to the Executive Management to carry out capital increase reserved to employees (13e)

Authorisation up to 1% of the capital Term : 26 months

45

Presentation of main resolutions

Resolutions on extraordinary business

46

Delegations of authority to the Executive Management to grant stock options (14e) and award bonus shares (15e)

Term : 38 months Common ceiling of 2 % of the number of existing shares for bonus shares and stock options Grant to the Executive Manager with performance conditions and obligation to keep the shares

46

Presentation of main resolutions

Resolutions on extraordinary business

47

Change in the Articles of Association (16e)

Article 18.2 : to set up a renewal of the Supervisory Board members by one third each year

47

2008 : dividend
Dividend per share proposed by the Supervisory Board

48

2004 *

2005 *

2006

2007

2008

Net dividend in euros

0.67

0.83

0.95

1.00

1.03

After the 3 to 1 split carried out on 10th June 2006

48

2009 Outlook

49

2009 : outlook

50

The environment remains more than uncertain Economic consequences of the crisis on purchasing power are
still to come

Japan and USA remain very difficult markets The luxury goods sectors is affected by this mood

50

2009 : outlook

51

To keep our way, Herms being strong of :

a steady vision : Herms craftsman and designer, confirming

a strong style

a high profitability, which could go down in 2009 strong cash reserves, an essential asset

51

2009 : outlook

52

Short term adjustments

Pace of investments
Manufactures : 2 projects delayed Stores : 2 projects delayed

Hirings, except in our leather workshops and our new stores Overheads : savings program Tight control on inventories

52

2009 : outlook

53

Development actions

Collections creativity Merchandising and liveliness in stores Supply chain, which will allow a better service in the stores better product flows And a better service to the final customer

53

2009 : outlook

54

Four exceptional store projects which will open in the coming years :

New York Madison Men space Herms Maison in Shanghai Geneva store Large store on left bank in Paris

54

1st quarter 2009

55

1st quarter sales : + 3.2 % - 4.7 % at constant exchange rates

55

2009 : outlook

56

The environment remains more than uncertain

An ambitious target for 2009

Sales : steady Profitability : slight decrease

56

57
In its history, Herms already went through crisis and overcame them thanks to its vision, its financial strength, its craftsmanship values, its family shareholding and to its customersdreams.

57

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58