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Sector Update

September 2014

Global Consumer & Retail


Investment Banking

Elizabeth A. Pickens

Global Apparel Managing Director


Head of Global Apparel and
Lifestyle Accessories

and Lifestyle Accessories epickens@williamblair.com


+44 207 868 4479
+1 212 237 2700
In this Issue:
Sector Trends
Insights
M&A Activity
Comparables Trading

William Blairs investment banking group combines signiicant transaction experience,


rich industry knowledge, and deep relationships to deliver successful advisory and
inancing solutions to our global base of corporate clients. We serve both publicly traded
and privately held companies, executing mergers and acquisitions, growth inancing,
inancial restructuring, and general advisory projects. This comprehensive suite of
services allows us to be a long-term partner to our clients as they grow and evolve.
From 2010-2014, the investment banking group completed more than 330 merger-and-
acquisition transactions worth $73 billion in value, involving parties in 36 countries and
About William Blair ive continents, was an underwriter on more than 20% of all U.S. initial public offerings,
Investment Banking and raised nearly $100 billion in public and private inancing.
William Blair

A Word on Lifestyle

In this first Issue of William Blairs dedicated coverage of the Global Apparel and Lifestyle Accessories Sector, we provide an
overview of market activity and valuation data across the worldwide sector leaders. We have classified the public comparable
companies into seven major groups: Global Leaders, Modern Lifestyle, Performance Apparel, Traditional Apparel and Accessories,
Youth/Teen, and eCommerce. In addition to the established sector leaders, we will also focus on the cohort of rapidly emerging next-
generation global brands, who are going public earlier and getting funded in the private markets today.
Our consumption choices, particularly in apparel and accessories, have long communicated our personal affiliations and aspirations.
Today, the consumption experience extends beyond the moment of purchase, often selling an experience, or communicating a value
set. This has broadened the remit for brands, invoking themes of greater social responsibility, seen by the growing prevalence of B
Corps, and community, including content-driven websites and entertainment-driven retail venues.
These changing consumer values have given rise to new sector leaders, including emergent brands Bonobos and Harrys of London,
lifestyle visionaries like Hunter Original, new marketplaces such as Gilt Groupe, and Vide Dressing, and radical new models such as
Warby Parker. In turn, M&A activity is driven by buyers keeping pace with these shortening cycles of innovation. Examples of such
activity includes the acquisition of Trunk Club by Nordstrom, and announced acquisition of Mytheresa.com by Neiman Marcus.
Lifestyle-driven consumption is an increasingly prevalent concept, making it a rare moment in time for valuations in this exciting
space.
We look forward to exploring the sector with you.

Sincerely,
Beth Pickens

Global Apparel and Lifestyle Accessories Report


A Word on Lifestyle
William Blair

Table of Contents
Consumer & Retail Investment Banking Contacts .................................................................................................................................................................... 3
Consumer & Retail Research Coverage.......................................................................................................................................................................................... 4
Selected William Blair Transactions ............................................................................................................................................................................................... 5
2014 Global Investor Conferences................................................................................................................................................................................................... 6
Sector View: Comparable Companies............................................................................................................................................................................................. 7
LTM Global Apparel and Lifestyle Accessories Sector Performance................................................................................................................................. 8
Comparable Company Analysis ........................................................................................................................................................................................................ 9
News Review...........................................................................................................................................................................................................................................12
IPO Backlog..............................................................................................................................................................................................................................................13
Equity Research Team ........................................................................................................................................................................................................................14
Notes ..........................................................................................................................................................................................................................................................15
Disclosures...............................................................................................................................................................................................................................................16

Global Apparel and Lifestyle Accessories Report


Table of Contents
William Blair

Consumer & Retail Investment Banking Contacts

Consumer & Retail Investment Banking

Elizabeth Pickens, Managing Director, joined William Blair in 2000. Ms. Pickens specializes in advising
international branded consumer and retail growth companies across global apparel and lifestyle brands. She is
also an angel investor in early-stage consumer companies, including Bonobos.com and InteriorDefine.com. Ms.
Pickens holds an MBA from the University of Chicago Graduate School of Business and a BS in finance from the
University of Illinois at Urbana-Champaign. She also completed studies at the Universit de Paris IV-Sorbonne.
epickens@williamblair.com
+44 20 7868 4479

Adam Filkin, Managing Director, joined William Blair in 2007 within the Consumer and Retail Investment
Banking Group. Mr. Filkin has extensive transaction experience across numerous consumer verticals, including
consumer products, personal care and food. He joined William Blair from Bank of America Securities. Before
joining Bank of America, Mr. Filkin was a manager at A.T. Kearney, focusing on consumer and retail companies.
Mr. Filkin holds an MBA with a concentration in finance from the University of Chicago Graduate School of
Business, and holds a BSE. in chemical engineering from the University of Michigan.
afilkin@williamblair.com
+1 312 364 8077

Michael Siska, Managing Director, joined the firm in 2002. Before joining William Blair, Mr. Siska worked in
private equity for Allstate Private Equity in Chicago and 3i Group in London. He spent five years in the products
and business services industry group at Andersen Corporate Finance LLC. He focuses on specialty retail, food
retail, restaurants, and consumer services. Mr. Siska earned an MBA from the University of Chicago and a BS,
with honors, from the University of Illinois at Urbana-Champaign.
msiska@williamblair.com
+1 312 364 5393

Laura Provenzale, Managing Director, joined Blair in 2014 within the Consumer and Retail Investment Banking
Group. Prior to joining William Blair, Ms. Provenzale built the restaurant investment banking practice and
executed transactions across the consumer sector at Raymond James. Before Raymond James, she led the
consumer and retail effort at WR Hambrecht, and prior to WR Hambrecht led the software M&A and the
consumer products investment banking practice at Banc of America Securities. Ms. Provenzale earned her MBA
from Fordham University and graduated with honors from Lehigh University with a BS in accounting.

lprovenzale@williamblair.com
+1 415 248 5919

Global Apparel and Lifestyle Accessories Report


Consumer & Retail Investment Banking Contacts 3
William Blair

Consumer & Retail Research Coverage

Amy Noblin

Sharon Zackfia

Mark Miller

Daniel Hofkin

Jon Andersen

Global Apparel and Lifestyle Accessories Report


4 Consumer & Retail Research Coverage
William Blair

Selected William Blair Transactions

$230,000,000 $246,047,100 $90,000,000 $94,112,106 $376,740,000 Not Disclosed Not Disclosed


$240,033,072 $74,750,000
$388,743,210

has completed a leveraged


363 sale to has been acquired by recapitalization with
Initial Public & Initial Public &
Initial Public Offering Follow-on Offerings Authentic Brands Group Follow-on Offering Initial Public Offering Proventus Berkshire Partners

March 2013
November 2012 February 2011
November 2013 April 2012 December 2012 October 2010 August 2007 July 2007 June 2007

Global Apparel and Lifestyle Accessories Report


Selected William Blair Transactions 5
William Blair

2014 Global Investor Conferences

34th Annual Growth Stock Conference


10-12 June 2014, Chicago

William Blair's Growth Stock Conference is an exclusive


gathering of the late-stage growth stock community,
including senior executives of fast-growing private
companies, corporate development teams from large- and
midcap industry leaders, and private equity investors
Featuring high-ranking senior management, a forum that
encourages the exchange of ideas, and extensive one-on-one
meetings, our conferences have become premier events for
growth stock investors
Superior access to industry leaders
More than 350 professionals from across the corporate
landscape
Our highly respected lineup of growth stock conferences
provides investors a private audience with C-level
executives in an environment that is conducive to dialogue
and interaction

16th Annual Private Equity Conference


17-18 September 2014, Chicago
This Years Event Highlights
55 participating companies
More than 600 registered institutional private equity
investors
Roundtable discussions focused on the following industry
sectors and topics:
Business services, commercial services, cross-border
investing, debt capital markets, equity capital markets,
healthcare, industrials, retail and restaurants, special
situations and restructuring, and technology
Roughly 682 requested one-on-one meetings between
private equity investors and company management

Global Apparel and Lifestyle Accessories Report


6 2014 Global Investor Conferences
William Blair

Sector View: Comparable Companies

Global

Modern Lifestyle

Performance

Traditional

Traditional Luxury

Youth

eCommerce

Global Apparel and Lifestyle Accessories Report


Sector View: Comparable Companies 7
William Blair

LTM Global Apparel and Lifestyle Accessories Sector Performance

LTM Indexed Stock Price Performance

S&P 500 (17.7%) EURO STOXX TMI (7.6%) Youth (-34.2%)


Traditional Luxury (-9.7%) Traditional (17.5%) Performance (6.8%)
Modern Lifestyle (16.1%) Global (7.5%) eCommerce (20.9%)

160.0%

140.0%

120.0%

100.0%

80.0%

60.0%

Source: CapitalIQ, public filings and William Blair analysis.

Global Apparel and Lifestyle Accessories Sector Valuation Overview

Enterprise Value / Revenue Enterprise Value / EBITDA P/E Ratio


14E-15E 2014E 2014E
Revenue Gross EBITDA 2014E
Sector LTM 2014E 2015E LTM 2014E 2015E 2014E 2015E Growth Margin Margin P/E/G
eCommerce 2.18x 2.16x 1.67x 12.2x 18.2x 17.0x 34.3x 27.8x 25.6% 32.6% 5.3% 2.7x
Global 2.42x 2.25x 2.04x 13.1x 12.2x 10.9x 22.6x 19.8x 9.6% 54.3% 18.2% 4.0x
Modern Lifestyle 2.79x 3.20x 2.72x 13.2x 12.3x 11.6x 22.2x 18.6x 18.7% 52.9% 23.4% 1.9x
Performance 1.27x 1.45x 1.28x 12.8x 12.8x 11.2x 25.0x 20.6x 11.3% 43.3% 8.3% 8.7x
Traditional 1.95x 1.87x 1.75x 10.8x 10.1x 9.1x 17.3x 15.1x 7.2% 52.3% 21.7% 1.3x
Traditional Luxury 3.04x 2.87x 2.64x 12.7x 11.6x 10.4x 20.3x 17.9x 8.4% 62.3% 24.0% 2.1x
Youth 1.07x 1.01x 1.04x 7.1x 7.3x 6.7x 17.6x 14.8x 6.2% 43.8% 11.4% 1.4x

Global Apparel and Lifestyle Accessories Report


8 LTM Global Apparel and Lifestyle Accessories Sector Performance
William Blair

Comparable Company Analysis

eCommerce

Enterprise Value / Revenue Enterprise Value / EBITDA PE Ratio


Share Price
(Local Market Enterprise 14E-15E 2014E 2014E
Currency) % of 52 Value Value Revenue Gross EBITDA 2014E
Company 8/15/2014 Week High ($MM) ($MM) LTM 2014E 2015E LTM 2014E 2015E 2014E 2015E Growth Margin Margin P/E/G

YOOX S.p.A. 24.2 51% 1,429 1,410 2.17x 1.94x 1.59x 27.0x 18.8x 14.7x NMF NMF 21.9% 37.1% 8.0% 1.8x

Amazon.com Inc. 333.2 82% 153,955 149,088 1.82x 1.64x 1.36x NMF 24.5x 17.8x NMF NMF 20.3% 28.3% 4.9% 67.0x

Blue Nile Inc. 26.3 53% 338 222 0.49x 0.49x 0.43x 9.9x 9.9x 8.9x 32.0x 26.4x 16.1% 18.6% 5.0% 1.9x

Zulily, Inc. 36.7 50% 4,583 4,273 4.51x 3.51x 2.40x NMF NMF NMF NMF NMF 46.3% 27.2% 2.5% 3.4x

ASOS plc 39.6 33% 3,284 3,165 2.13x 1.79x 1.45x NMF 26.6x 19.4x NMF 35.9x 23.3% 51.8% 6.7% 1.9x

Median 2.13x 1.79x 1.45x 18.5x 21.6x 16.3x 32.0x 31.1x 21.9% 28.3% 5.0% 1.9x

Average 2.23x 1.87x 1.45x 18.5x 19.9x 15.2x 32.0x 31.1x 25.6% 32.6% 5.4% 15.2x

Global

Enterprise Value / Revenue Enterprise Value / EBITDA PE Ratio


Share Price
(Local Market Enterprise 14E-15E 2014E 2014E
Currency) % of 52 Value Value Revenue Gross EBITDA 2014E
Company 8/15/2014 Week High ($MM) ($MM) LTM 2014E 2015E LTM 2014E 2015E 2014E 2015E Growth Margin Margin P/E/G

H & M Hennes &


42.8 98% 70,876 68,056 3.37x 3.17x 2.86x 16.3x 15.4x 13.7x 24.5x 21.7x 11.2% 59.0% 20.6% 2.1x
Mauritz AB (publ)

The Gap, Inc. 42.1 95% 18,572 18,421 1.14x 1.10x 1.05x 7.1x 6.8x 6.3x 14.2x 12.6x 4.6% 46.3% 15.9% 1.2x

Ralph Lauren
163.2 90% 14,351 13,556 1.81x 1.74x 1.61x 9.8x 9.8x 9.0x 19.5x 16.7x 7.8% 57.9% 18.4% 1.3x
Corporation

Industria de Diseno
28.7 88% 89,530 84,636 3.76x 3.52x 3.17x 16.5x 14.9x 13.3x 26.1x 22.8x 10.9% 59.2% 22.8% 2.3x
Textil SA

Fast Retailing Co. Ltd. 322.4 73% 32,858 30,026 2.29x 2.15x 1.90x 17.1x 16.9x 15.2x NA 32.1x 13.3% 49.9% 13.4% NA

Median 2.29x 2.15x 1.90x 16.3x 14.9x 13.3x 22.0x 21.7x 10.9% 57.9% 18.4% 1.7x

Average 2.47x 2.34x 2.12x 13.4x 12.7x 11.5x 21.1x 21.2x 9.6% 54.5% 18.2% 1.7x

Modern Lifestyle

Enterprise Value / Revenue Enterprise Value / EBITDA PE Ratio


Share Price
(Local Market Enterprise 14E-15E 2014E 2014E
Currency) % of 52 Value Value Revenue Gross EBITDA 2014E
Company 8/15/2014 Week High ($MM) ($MM) LTM 2014E 2015E LTM 2014E 2015E 2014E 2015E Growth Margin Margin P/E/G

Moncler S.p.A. 16.2 73% 4,047 4,330 NMF 4.69x 4.11x 16.2x 14.5x 12.5x 26.1x 21.4x 14.1% 71.6% 32.4% 1.5x

Coach, Inc. 36.3 63% 10,233 9,435 1.86x 2.11x 2.16x 5.0x 8.5x 9.1x 17.7x 18.0x (2.5%) 73.0% 37.0% 2.8x

Under Armour, Inc. 68.8 97% 7,574 7,379 3.16x 3.16x 1.98x 20.6x 20.6x 14.2x NMF NMF 59.6% 48.7% 15.4% 3.0x

Harley-Davidson, Inc. 62.4 84% 13,570 18,235 2.91x 3.25x 3.03x 12.1x 12.2x 10.9x 16.5x 14.3x 7.4% 39.4% 24.0% 1.2x

Kate Spade & Company 31.6 74% 4,005 4,237 2.99x 3.91x 3.16x NMF NMF 20.1x NA NA 23.5% 57.1% 4.3% NA

Tumi Holdings, Inc. 23.2 94% 1,577 1,548 3.31x 3.31x 2.52x 14.8x 14.8x 11.5x 26.0x 22.3x 31.2% 57.5% 22.4% 1.7x

Michael Kors Holdings


78.4 78% 16,178 15,349 NMF 3.74x 3.02x 15.1x 11.6x 9.7x 20.2x 16.7x 23.8% 61.0% 34.0% 0.9x
Limited

Vince Holding Corp 32.9 87% 1,210 1,338 4.44x 3.95x 3.37x 23.9x 17.8x 15.0x 35.8x 27.7x 17.3% 47.1% 18.6% 1.4x

Lululemon Athletica
38.8 50% 5,659 4,960 3.12x 2.79x 2.46x 10.3x 12.0x 10.6x 23.5x 19.4x 13.4% 54.7% 30.2% 1.4x
Inc.

G-III Apparel Group,


77.2 92% 1,702 1,765 0.97x 0.85x 0.78x 12.1x 10.1x 8.5x 18.6x 15.7x 9.8% 34.4% 8.1% 1.0x
Ltd.

Apple Inc. 97.5 98% 583,817 576,931 3.24x 3.12x 2.89x 9.8x 9.4x 8.9x 14.9x 13.6x 7.9% 38.4% 33.2% 1.2x

Median 3.12x 3.25x 2.89x 13.5x 12.1x 10.9x 20.2x 18.0x 14.1% 54.7% 24.0% 1.4x

Average 2.89x 3.17x 2.68x 14.0x 13.1x 11.9x 22.1x 18.8x 18.7% 53.0% 23.6% 1.6x

Global Apparel and Lifestyle Accessories Report


Comparable Company Analysis 9
William Blair

Performance

Enterprise Value / Revenue Enterprise Value / EBITDA PE Ratio


Share Price
(Local Market Enterprise 14E-15E 2014E 2014E
Currency) % of 52 Value Value Revenue Gross EBITDA 2014E
Company 8/15/2014 Week High ($MM) ($MM) LTM 2014E 2015E LTM 2014E 2015E 2014E 2015E Growth Margin Margin P/E/G

Fenix Outdoor AB 47.4 80% 829 529 2.91x 2.68x 2.51x 17.4x 13.9x 12.4x 20.1x 17.4x NA 54.8% 16.7% NA

Nike, Inc. 77.3 96% 71,707 67,504 2.67x 2.31x 2.12x 17.1x 15.6x 14.0x 25.1x 21.3x 8.8% 43.6% 15.6% 1.8x

Quiksilver Inc. 3.0 33% 520 1,353 0.77x 0.80x 0.77x 13.9x 13.2x 8.9x NMF NMF 3.3% 49.4% 5.6% (0.7x)

PUMA SE 252.5 79% 3,773 3,418 0.89x 0.88x 0.84x NMF 12.5x 10.1x 35.0x 23.4x 4.4% 46.4% 2.5% (9.9x)

Columbia Sportswear
75.2 84% 2,667 2,145 1.27x 1.27x 0.97x 11.3x 11.3x 8.6x 21.5x 18.4x 31.0% 44.2% 11.3% 1.7x
Company

Black Diamond, Inc. 8.0 53% 259 293 1.44x 1.44x 1.21x NMF NMF 28.7x NMF NMF 19.5% 38.9% 4.4% (3.6x)

Lafuma SA 26.2 98% 186 169 0.69x NA NA 6.4x NA NA NMF NA NA 35.0% 10.8% NA

Adidas AG 79.9 64% 16,719 17,156 0.89x 0.88x 0.83x 10.2x 9.7x 8.4x 19.3x 15.3x 5.8% 48.8% 8.7% 2.1x

ASICS Corp. 22.1 94% 4,189 4,403 1.09x 1.33x 1.16x 9.9x 13.1x 11.4x 24.1x 22.4x 15.2% 44.2% 11.0% 4.7x

Mizuno Corporation 6.1 95% 763 925 0.51x 0.50x 0.49x 11.3x 10.8x 10.0x 21.4x 19.1x 2.4% 39.6% 4.6% 1.42x

Median 1.19x 1.18x 1.07x 13.1x 12.8x 10.4x 23.9x 20.6x 7.3% 44.2% 9.3% 2.7x

Average 1.43x 1.45x 1.28x 13.3x 12.8x 11.2x 24.5x 20.2x 11.3% 44.5% 9.2% 12.5x

Traditional

Enterprise Value / Revenue Enterprise Value / EBITDA PE Ratio


Share Price
(Local Market Enterprise 14E-15E 2014E 2014E
Currency) % of 52 Value Value Revenue Gross EBITDA 2014E
Company 8/15/2014 Week High ($MM) ($MM) LTM 2014E 2015E LTM 2013E 2014E 2014E 2015E Growth Margin Margin P/E/G

ANN INC. 35.8 82% 1,678 1,551 0.62x 0.61x 0.58x 5.7x 5.6x 5.2x 17.7x 14.2x 4.7% 53.3% 10.9% 1.5x

L Brands, Inc. 62.8 93% 18,319 22,400 2.06x 1.99x 1.88x 10.3x 10.1x 9.2x 19.7x 17.4x 5.4% 46.6% 20.1% 1.7x

V.F. Corporation 61.9 97% 28,015 28,688 2.51x 2.51x 2.14x 14.7x 14.7x 12.2x 20.0x 17.7x 17.1% 48.1% 17.1% 1.5x

Oxford Industries Inc. 61.7 74% 1,015 1,149 1.22x 1.15x 1.07x 9.4x 8.8x 7.8x 20.3x 16.8x 7.5% 55.6% 13.0% 1.1x

Express Inc. 14.2 57% 1,193 1,217 0.56x 0.57x 0.55x 5.0x 5.7x 5.1x 17.8x 14.2x 3.1% 41.4% 11.2% 1.1x

PVH Corp. 112.7 81% 9,278 12,871 1.56x 1.52x 1.43x 11.1x 10.3x 9.2x 17.1x 12.8x 6.3% 52.2% 14.0% 1.4x

Hanesbrands Inc. 98.4 92% 9,800 11,445 2.34x 2.24x 2.03x 14.9x 13.8x 12.4x 20.3x 16.1x 10.3% 35.8% 15.7% 1.3x

Perry Ellis International


18.7 88% 293 483 0.53x 0.52x 0.51x 14.6x 10.0x 9.1x 21.3x 15.0x 3.0% 33.3% 3.7% 3.6x
Inc.

Cherokee Inc. 18.4 97% 155 184 NMF NMF NMF 11.7x 11.1x 10.1x 16.2x 15.5x 6.0% 100.0% 51.3% 1.2x

Iconix Brand Group, Inc. 41.2 92% 1,978 3,386 NMF NMF NMF 12.3x 11.6x 10.8x 14.7x 15.1x 6.3% 100.0% 61.5% 1.2x

Gildan Activewear Inc. 57.6 93% 7,038 7,126 3.07x 2.88x 2.61x 15.7x 14.2x 11.6x 18.7x 15.6x 10.7% 27.7% 19.6% 1.3x

Next Plc 114.2 86% 17,520 18,295 2.93x 2.72x 2.58x 13.0x 11.7x 11.0x 16.9x 15.8x 5.5% 33.2% 22.6% 1.8x

Median 1.81x 1.75x 1.66x 12.0x 10.7x 9.7x 18.2x 15.5x 6.2% 47.3% 16.4% 1.3x

Average 1.74x 1.67x 1.54x 11.5x 10.6x 9.5x 18.4x 15.5x 7.2% 52.3% 21.7% 1.5x

Global Apparel and Lifestyle Accessories Report


10 Comparable Company Analysis
William Blair

Traditional Luxury

Enterprise Value / Revenue Enterprise Value / EBITDA PE Ratio


Share Price
(Local Market Enterprise 14E-15E 2014E 2014E
Currency) % of 52 Value Value Revenue Gross EBITDA 2014E
Company 8/15/2014 Week High ($MM) ($MM) LTM 2014E 2015E LTM 2014E 2015E 2014E 2015E Growth Margin Margin P/E/G

Compagnie Financiere
96.1 91% 54,086 47,319 3.34x 3.20x 2.93x 12.6x 11.6x 10.5x 18.4x 16.6x 9.4% 63.4% 26.4% 1.6x
Richemont SA

Tiffany & Co. 97.0 94% 12,750 13,400 3.32x 3.05x 2.84x 13.3x 12.1x 10.8x 22.6x 19.7x 7.5% 58.1% 25.0% 1.6x

Kering SA 208.2 86% 26,385 31,943 2.44x 2.36x 2.19x 11.7x 11.5x 10.2x 17.0x 13.9x 7.6% 62.5% 20.9% 1.6x

LVMH Moet Hennessy


171.9 86% 86,211 96,370 2.43x 2.34x 2.17x 10.4x 9.7x 8.8x 18.3x 16.2x 7.9% 65.4% 23.5% 2.0x
Louis Vuitton SA

Hugo Boss AG 139.9 92% 9,656 9,918 2.99x 2.84x 2.62x 13.7x 12.1x 10.8x 19.5x 17.1x 8.3% 66.2% 21.9% 1.6x

Burberry Group plc 24.4 87% 10,712 10,019 2.58x 2.46x 2.26x 10.6x 10.3x 9.8x 19.8x 18.4x 9.1% 71.2% 24.4% 2.4x

Prada S.p.A 7.0 65% 17,811 17,327 3.62x 3.49x 3.17x 11.8x 11.2x 10.1x 21.2x 18.9x 10.2% 73.9% 30.8% 2.2x

Tod's SpA 106.7 55% 3,265 3,117 2.40x 2.37x 2.22x 11.2x 10.5x 9.5x 19.7x 17.4x 6.9% 36.0% 21.4% 3.8x

Salvatore Ferragamo
26.7 67% 4,492 4,577 2.68x 2.54x 2.34x 13.0x 11.9x 10.5x 21.5x 18.7x 8.5% 63.3% 20.6% 1.5x
SpA

Median 2.68x 2.54x 2.34x 11.8x 11.5x 10.2x 19.7x 17.4x 8.3% 63.4% 23.5% 1.6x

Average 2.87x 2.74x 2.53x 12.0x 11.2x 10.1x 19.8x 17.4x 8.4% 62.2% 23.9% 2.0x

Youth

Enterprise Value / Revenue Enterprise Value / EBITDA PE Ratio


Share Price
(Local Market Enterprise 14E-15E 2014E 2014E
Currency) % of 52 Value Value Revenue Gross EBITDA 2014E
Company 8/15/2014 Week High ($MM) ($MM) LTM 2014E 2015E LTM 2014E 2015E 2014E 2015E Growth Margin Margin P/E/G

American Apparel, Inc. 0.9 49% 154 388 0.61x 0.61x 0.58x NMF 9.4x 6.6x NMF NMF 4.0% 50.6% 0.5% NA

American Eagle
10.8 64% 2,098 1,770 0.54x 0.55x 0.54x 5.6x 5.8x 4.9x 20.1x 14.8x 1.7% 33.8% 9.6% 1.9x
Outfitters, Inc.

Guess? Inc. 25.5 73% 2,172 1,725 0.68x 0.68x 0.66x 5.5x 6.3x 5.4x 17.2x 14.1x 2.4% 37.5% 12.4% 2.9x

Abercrombie & Fitch


41.4 84% 3,103 2,248 0.55x 0.56x 0.55x 4.5x 4.5x 4.1x 17.9x 14.9x 1.4% 62.6% 12.2% 1.0x
Co.

The Buckle, Inc. 45.8 84% 2,215 2,023 1.79x 1.75x 1.69x 7.0x 6.9x 6.6x 13.4x 13.0x 3.2% 50.1% 25.6% 2.1x

Bebe Stores, Inc. 2.9 41% 226 99 0.22x 0.23x 0.21x NMF NMF 5.8x NMF NMF 8.1% 32.0% (5.9%) (0.2x)

Vera Bradley, Inc. 19.1 64% 781 768 1.42x 1.48x 1.33x 6.3x 9.0x 7.5x 18.4x 15.2x 11.1% 56.6% 22.3% 1.3x

Francesca's Holdings
12.8 52% 541 534 1.57x 1.38x 1.21x 6.1x 6.2x 5.4x 11.9x 10.1x 13.9% 51.7% 25.9% 0.7x
Corporation

Body Central Corp. 0.4 5% 7 3 0.01x 0.01x NA NMF NMF NA NMF NA NA 33.8% (19.1%) NA

Urban Outfitters Inc. 36.3 82% 5,408 4,884 1.58x 1.46x 1.33x 8.5x 8.5x 7.5x 18.9x 16.0x 10.1% 37.6% 18.6% 1.2x

Median 0.65x 0.64x 0.66x 6.1x 6.6x 5.8x 17.9x 14.8x 4.0% 43.9% 12.3% 1.3x

Average 0.90x 0.87x 0.90x 6.2x 7.1x 6.0x 16.8x 14.0x 6.2% 44.6% 10.2% 1.4x

Global Apparel and Lifestyle Accessories Report


Comparable Company Analysis 11
William Blair

News Review
9/15/2014 The Neiman Marcus Group has agreed to buy Mytheresa.com, the Munich-based luxury fashion e-tailer, from founders and minority
investor Acton Capital Partners.

8/20/2014 TOMS Shoes Inc. has announced the signing of a definitive agreement to partner with Bain Capital, to accelerate the growth of the
company and its giving programs around the world. TOMS Founder and Chief Shoe Giver Blake Mycoskie will continue as visionary
of the company and remain 50% owner of TOMS.

8/10/2014 A stake in Achica, the UK-based "flash" sales website, has been acquired by Lansdowne Partners, The Sunday Telegraph reported.
The report said Companies House filings revealed the fund manager's acquisition of an equity stake; it did not specify how much
Lansdowne paid or the size of its holding.

7/31/2014 Catterton Partners announced it has agreed to acquire Hong Kong-based designer jeweler John Hardy Limited in a management
buyout transaction from 3i Group for an estimated minimum of USD 100m.

7/30/2014 Kering and Ulysse Nardin have signed an agreement for Kering to acquire 100% of the capital of Ulysse Nardin. The deal value was
not disclosed. The brand will join Kering's Luxury - Watches and Jewellery' division, headed by Albert Bensoussan, and the
management team will remain in place. The deal should be finalised during the second half of 2014.

5/20/2014 The Mondadori Group is accelerating the development of the "Grazia International Network", which entered the e-commerce
fashion market through the acquisition of London-Boutiques.com. The London-based marketplace offers readers and users the
possibility of selecting a wide range of clothing and accessories of some of the British capital's best boutiques.

5/1/2014 Farfetch, the global ecommerce site for independent boutiques, has raised USD 66 million in a Series D round of investment led by
London-based private equity firm Vitruvian Partners. Farfetch has sales of USD 275 million and year-on-year growth of 100%.

4/13/2014 Sycamore Partners announced that Kurt Geiger, a leading European luxury branded shoe retailer, has completed a management-led
buyout and is now operating as an independent company. Sycamore Partners supported Kurt Geiger's management team in its
acquisition of the business, which previously was a division of the Jones Group Inc.

4/9/2014 PVH Corp. announced that it has become a minority shareholder in the parent company of the Karl Lagerfeld brand.

4/9/2014 L Capital Management and L Capital Asia, two private equity companies sponsored by the Louis Vuitton Moet Hennessy Group
(LVMH), have acquired a 30% stake of Vicini S.p.A., owner of the Giuseppe Zanotti Design brand. On a strategic standpoint, this new
partnership comes from the willingness of Giuseppe Zanotti, Vicinis Chairman and Chief Designer, to create the ideal conditions to
foster the companys future growth in the increasingly competitive global markets.

4/8/2014 Bree, the German handbag maker, has been acquired by a group of investors, Sueddeutsche Zeitung reported. The German-language
daily cited the company as saying that Philipp Bree, a son of the company founder, sold his 50% stake, while his brother Axel Bree
also sold a small stake. The report said majority ownership of Bree now lies in the hands of investors led by two retail experts:
Peter Wolf and Klaus Schmidt. Bree's annual turnover is about EUR 50m, according to the article.

3/29/2014 Better Capital, has invested an additional GBP 7.5m in its Jaeger fashion retail business.

3/28/2014 IC Company has entered into an agreement to sell its Mid Market division comprising of the four brands InWear, Matinique, Part
Two and Soaked in Luxury as well as the store concept COMPANYS to DK Company, according to a company press release. In the
future IC Company will focus on the Premium segment in which the Company has realized strong growth and solid earnings for the
past few years.

3/24/2014 Steven Madden Ltd. and footwear designer Brian Atwood have acquired Atwood's brand for an undisclosed sum, Women's Wear
Daily reported.

3/17/2014 Labelux, an Austrian fashion company, has reportedly sounded out investment banks regarding a potential flotation of a minority
shareholding in its Jimmy Choo shoes business. Early estimates indicate that Jimmy Choo could have a flotation value of about GBP
1bn (EUR 1.19bn), the item said, noting that Labelux paid GBP 525m for the company in 2011.

3/11/2014 Betty Blue Spa, a private Italian fashion company that owns the Elisabetta Franchi and Betty Blue brands, aims to list a 30% to 40%
share on the Milan Bourse between 2017 and 2018, Giacinto DOnofrio, a partner at Betty Blues sponsor Trilantic Capital Partners
said.

3/7/2014 Etro, the Italian fashion house, has denied that it is up for sale, MF Fashion reported. The report cited a press release denying sale
rumours.

3/3/2014 Iconix Brand Group, Inc. , today announced that it has acquired the remaining 50% of Iconix Latin America from its joint venture
partner, New Brands Group, S.A., for USD 42m.

3/2/2014 Oakley Capital has acquired a majority interest in North Technology Group, the "North Sails" sailing brand.

Global Apparel and Lifestyle Accessories Report


12 News Review
William Blair

IPO Backlog

2014YTD IPOs by Primary Sector Current IPO Backlog by Primary Sector

Europe

4% Consumer 1% Consumer
20%
Business Services Business Services
39% Financial 35% Financial
2%
40%
Healthcare Healthcare

Industrial Industrial

Technology 4% Technology
5% 38%
6% 6%

U.S.

Consumer 6% 12% Consumer


18% 21%
Business Services 4% Business Services

Financial Financial
5% 13%
Healthcare Healthcare
27% Industrial 53% Industrial
18% 11%
Technology Technology
11%

Asia

Consumer 7%
8% Consumer
17%
7%
Business Services Business Services
33% 4%
Financial 8% Financial

Healthcare Healthcare

37% 5% Industrial Industrial


1% 66%
7% Technology Technology

Global Apparel and Lifestyle Accessories Report


IPO Backlog 13
William Blair

Equity Research Team


Amy Noblin
+1 415 248 2874
Apparel and Accessories
Abercrombie & Fitch Co. (ANF) Michael Kors Holdings Limited (KORS) Vera Bradley, Inc. (VRA)
Coach, Inc. (COH) Nordstrom, Inc. (JWN) Vince Holding Corp. (VNCE)
DSW Inc. (DSW) Tiffany & Co. (TIF)
Francescas Holdings Corporation (FRAN) Tumi Holdings, Inc. (TUMI)

Sharon Zackfia, CFA


Group HeadConsumer
+1 312 364 5386
Apparel and Accessories, Leisure, Restaurants
BJs Restaurants, Inc. (BJRI) Harley-Davidson, Inc. (HOG) Starbucks Corporation (SBUX)
Bloomin Brands, Inc. (BLMN) Life Time Fitness, Inc. (LTM) Tillys, Inc. (TLYS)
CarMax, Inc. (KMX) lululemon athletica inc. (LULU) Tumi Holdings, Inc. (TUMI)
Carnival Corporation (CCL) Panera Bread Company (PNRA) Under Armour, Inc. (UA)
The Cheesecake Factory Incorporated (CAKE) Potbelly Corporation (PBPB) Urban Outfitters, Inc. (URBN)
Chipotle Mexican Grill, Inc. (CMG) Royal Caribbean Cruises Ltd. (RCL) Zumiez Inc. (ZUMZ)
Dunkin Brands Group, Inc. (DNKN) Sonic Corp. (SONC)

Mark Miller, CFA


+1 312 364 8498
Broad Assortment and Hardlines, E-commerce, Health and Beauty
Amazon.com, Inc. (AMZN) The Fresh Market, Inc. (TFM) Vitamin Shoppe, Inc. (VSI)
Blue Nile, Inc. (NILE) GNC Holdings Inc. (GNC) Walgreen Co. (WAG)
Cabelas Incorporated (CAB) Mattress Firm Holding Corp. (MFRM) Wal-Mart Stores, Inc. (WMT)
Costco Wholesale Corporation (COST) MercadoLibre, Inc. (MELI) Whole Foods Market, Inc. (WFM)
CVS Caremark Corporation (CVS) Natural Grocers by Vitamin Cottage, Inc. (NGVC) zulily, inc. (ZU)
Dicks Sporting Goods, Inc. (DKS) Target Corporation (TGT)
Fairway Group Holdings Corp. (FWM) Tractor Supply Company (TSCO)

Daniel Hofkin
+1 312 364 8965
Hardlines, Specialty Retail
Bed Bath & Beyond Inc. (BBBY) Regis Corporation (RGS) The TJX Companies, Inc. (TJX)
Luxottica Group S.p.A. (LUX) Restoration Hardware Holdings, Inc. (RH) Ulta Salon, Cosmetics & Fragrance, Inc. (ULTA)
OReilly Automotive, Inc. (ORLY) Ross Stores, Inc. (ROST) Williams-Sonoma, Inc. (WSM)
PetSmart, Inc. (PETM) Steiner Leisure Limited (STNR)

Jon Andersen, CFA


+1 312 364 8697
Consumer Products
Annies, Inc. (BNNY) The J.M. Smucker Company (SJM) The Procter & Gamble Company (PG)
AptarGroup, Inc. (ATR) Jarden Corporation (JAH) The Scotts Miracle-Gro Company (SMG)
Boulder Brands, Inc. (BDBD) Kellogg Company (K) SodaStream International Ltd. (SODA)
Church & Dwight Co., Inc. (CHD) Keurig Green Mountain (GMCR) Tempur-Pedic International Inc. (TPX)
Colgate-Palmolive Company (CL) Mead Johnson Nutrition Company (MJN) TreeHouse Foods, Inc. (THS)
Fox Factory Holding Corporation (FOXF) Perrigo Company (PRGO)
J&J Snack Foods Corp. (JJSF) Prestige Brands Holdings, Inc. (PBH)

Global Apparel and Lifestyle Accessories Report


14 Equity Research Team
William Blair

Notes

Global Apparel and Lifestyle Accessories Report


Notes 15
William Blair

Disclosures

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William Blair & Company | 222 West Adams Street | Chicago, Illinois 60606 | +1 312 236 1600 | williamblair.com
August 18, 2014
Global Apparel and Lifestyle Accessories Report
16 Disclosures