Oriflame Cosmetics

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Oriflame Cosmetics
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Introduction to Oriflame
Sales by Region 2008
CIS Baltics 59

• Founded in 1967
• Cosmetics company selling direct
• 2.8 million sales consultants
• Operations in 61 countries of which
• Franchisees in 13 countries
• Production facilities in Poland Sweden India
  China and Russia
• 7500 employees

EMEA 30
Asia 6
Latin America 5
) Before restructuring costs due to the new
operational platform of 8.7m. (25.8m)
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A Long Term Growth Company
m
1990 - 2008 CAGR organic sales of over 17
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THIS IS ORIFLAME
Our Logotype Slogan
To be the 1 BeautyCompany Selling Direct
Our Vision
Where were going
To Fulfil Dreams
Our reason for being
Our Mission
Our Offer
What we offer
Our Business Opportunity concept
What we should be best in the world at
How we create and build the business opportunity
concept
Our Strategy
Togetherness Spirit PassionRespect People
Focus on Customers Demand QualitySeek
Simplicity and Cost-efficiency Pursue Long-term
Growth
Our Values OperatingPrinciples
How we work together
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Brands and Products
Sales by Category 2008
Fragrances 20

• Natural Swedish Cosmetics
• 950 products of which 1/3 new each year
• RD
• Product stories and catalogue communication
• New product category
• Wellness

Skin Care 25
Colour C. 26
Personal Hair Care 20
Accessories 9
Wellness Bringing Beauty from Within
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The Oriflame Catalogue

• Oriflames shop window
• New offers and catalogues every third week
• 35 languages
• Forceful combination of product and catalogue
  development in Stockholm

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Our Business Model
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Our Business Opportunity is Unique
The Direct Selling Industry is divided into two
camps
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Production and Supply Chain

• Over 700 million units sourced annually
• of which approx. 50 in-house
• Own factories in Poland Sweden
• India China and Russia
• Product Fulfilment Project

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Market Opportunity

• Cosmetics and Toiletries Industry Dynamics

2007 Cosmetics Toiletries Spending per Capita
EUR
Sweden
Germany
Brazil
Turkey
Asian average
China
2007 GDP per Capita EUR
Source Euromonitor
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Projected Market Size and Growth by Region
(Oriflame markets)
Fixed 2007 exchange rates. Value at current
prices
) Real Growth (fixed prices)

• Second priority
• Open markets where possible

• First priority
• Defend market share in a more competitive
  environment
• Grow market share where we have a low penetration

Source Euromonitor
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Direct Selling Industry - Product categories
Direct selling channel categories
USD Billion
A 111bn industry with 62 million independent
consultants (2007). Source WFDSA 2008.
Source Oriflame estimation based on Euromonitor
data and other sources Selected products in
major markets Includes skin care make up and
other cosmetics Other includes jewellery
gift items auto care pet products various
services (e.g. flower delivery) and other
consumer goods items not accounted for elsewhere
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Financial Highlights 2008

• Sales 20 in Euro
• 23 in local currency.
• Operating profit 21 to 187.3m (155.4).
• Operating margin 14. (14.0).
• Net profit 133.1m (116.0m).

) Before restructuring costs of 14.0m in Q407
8.7M in FY08 and 25.8m in FY08
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Balance Sheet and Cash Flow Highlights

• Net debt 196.3m (182.0m)
• Net debt/EBITDA 0.91 (1.00)
• Full year interest cover 7.0 (7.5)
• Operating cash flow 91.3m (102.2m)
• Cash flow from investing activities -34.4m
  (-36.8m)
• Retained dividend of 1.25 (1.25) per share

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Regional Overview Jan - Dec 2008
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Financial Outlook and Policies

• Sales growth for 2009 is expected to be above
  10 in local currency and the operating margin
  is expected to be around 11.
• Long term financial targets are to achieve local
  currency sales growth of around 10 per annum
  and to reach 15 operating margin.
• Dividend policy is to distribute at least 50 of
  net profit annually

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Cautionary Statement Some statements herein are
forward-looking and the actual outcome could be
materially different. In addition to the factors
explicitly commented upon the actual outcome
could be materially effected by other factors
like for example the effect of economic
conditions exchange-rate and interest-rate
movements political risks impact of competing
products and their pricing product development
commercialization and supply disturbances.