Umbro plc Inspire

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Umbro plcInspire Excite the World of Football
Preliminary results for the year ended 31
December 2006
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Highlights

• Delivering against growth objectives
• PBT (before exceptional items) up 16
• Adjusted EPS up 26
• Strong International development
• China investment
• Dicks Sporting Goods relationship (USA)
• Brand transitioning
• Performance technology
• Lifestyle
• Operational developments
• Priority markets
• Sourcing
• Current trading in line with management
  expectations
• Large increase in dividend a sign of Board
  confidence

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• Financial Review
• Steve Makin
• CFO

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A year of record profits
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Profit and loss account
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Broad based growth across product categories

• Licensed apparel boosted by tournament year
• Branded product growth gt10 cer
• Footwear remains an opportunity.

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Broad based growth across geographies

• Solid European progress
• Rapid growth in Asia
• Americas strong growth in Latin America
  impacted by USA performance
• 64 of revenues generated outside the UK.

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TWE growth 2006 v 2004
UK
Licensed
Branded
International

• Branded products account for 60 of TWE growth
• International markets account for 80 of TWE
  growth.

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Buy/sell gross margin reduction

• Expected dilution due to product mix
• Consolidation / pricing additional dilution
• Sourcing good progress.

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Other PL items

• Strong royalty growth
• International growth
• Badge royalty mix
• New business
• Operating expenses
• Targeted investment
• Brand Marketing
• Sports Marketing
• Design and Development
• Good underlying cost control
• Share of Associates Profits
• Full year of 25 equity on PAT of 6.5m (2005
  5.2m)
• Tax rebate
• 1.5m - prior year overprovision
• Underlying rate unchanged at 30

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Balance sheet strengthening

• Debtor reduction versus 2005 Chelsea cash paid
  mid year
• Creditor reduction versus 2005 rolling 2yr
  payment to The FA
• Earlier 2007 England home kit launch stock
  build.

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Cash flow boosted by exceptional receipt

• Strong Operating Cash Flow
• Working Capital requirement boosted by 2007
  launch timing and sales phasing
• Investments in 2007 plus Working Capital
  increases 2007 cash requirement.

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CFO Summary

• 2006 Strong progress
• Broad based growth in line with objectives
• Increasing International exposure
• Margin pressure from consolidation and pricing
• Targeted investment strong underlying cost
  control
• Final dividend increase reflects Balance Sheet
  strength and management confidence.
• Current trading
• In line with management forecasts
• Non-tournament year Euro qualification
  sensitivity
• Business transitioning - buy / sell share,
  sourcing
• Cash requirement Working Capital, China, NFC
• Opportunities for further investment.

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• Peter McGuigan
• CEO

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Defining the field of play

• Football is THE Global game
• High participation rate
• TV coverage World Cup, English Premier League.
• Popularity is growing
• The Football Performance market is 5bn in a
  Sporting Goods market of 100bn
• Growth of 5 6 p.a.
• Umbro is dedicated to football.
• Globally, 77 of people interested in football
  recognise the Umbro brand.

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Group Strategy
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Leverage authenticity - Sponsorships at every
level

• Global presence
• Selective investment in trophy names.
• International reach (OL, Santos, Independiente)
• English Premier League focus
• Investment in grass roots.
• More Clubs
• West Ham United, Wigan Athletic, West Bromwich
  Albion, Sunderland.
• Tournaments.
• Umbro sponsor 12 of the top 20 global 11 a side
  amateur tournaments.
• FA Umbro 5s
• China 5v5

Independiente
Santos
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Enhance image Performance technology
Apparel

• Evolution X growth continues 21 versus 2005,
  all markets
• Trilogy fabric development.
• Cotton / Polyester mix, invented by Umbro.
• Used in all 2007 kits plus SX.

Footwear

• Share of football boot market declined
• Technical collaborations / strong design.

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Enhance image - Lifestyle

• First season for u by Umbro
• New distribution includes
• JD
• Sweden
• FL Europe
• 60 top-end doors, limited to key markets and
  retailers
• Kim Jones continues to develop focus on
  Footwear

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Enhance image - Share of space in store

• Brands competing for share of voice
• International Licensee focus
• Shop in Shop / StandAlone Stores
• China 1050
• Rest of World - 600
• Investment in UK
• Football areas
• Leverage England
• JJB and Sportsworldfootball areas

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Maximise reach distribution strategy

• Top 10 markets are 80 of the global market
• Umbro are represented in all of the top 10
• UK / USA subsidiaries
• China JV
• Remainder 7 Licensees
• Umbros Top 10 Licensees account for gt70 of
  global TWE
• Selective investment and consolidation
• Simplify group structure
• Brand control
• Likely to lead to selective investment

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Maximise reach - Greater China

• 48.2 cer growth in 2006 over 2005 - 54m
• Distribution ahead of plan with in excess of 1000
  Umbro SAS/SIS outlets, target of a further 300 by
  year end
• Product focus In-market design
• Increased equity stake from 25 to 40.

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Maximise reach - USA

• 2006 Turnover reduced by 63 cer versus 2005
• Over reliance on Footlocker in 2005
• 40 growth in non Footlocker business in 2006,
  driven through Soccer Accounts
• Significant new Dicks Sporting Goods agreement
• Leveraging ownership of United Soccer Leagues
• Building brand authenticity
• Broadening distribution.

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Maximise reach - UK

• Impressive headline growth of 22
• World Cup brand exposure
• Solid growth in branded business
• Margins under pressure from consolidation
• Footwear sales disappointing
• New Sportsworld agreement shift to buy/sell
• In store football area investment
• Footwear back to growth
• Margin initiatives under way.

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UK- investment in in-store merchandising
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Maximise reach - Umbro Asia Sourcing (UAS)

• Global brand control
• Social compliance
• Support for future growth
• Margin opportunity share of global profits
• Fully operational January 1st 2007
• Licensees required to source all Umbro apparel
  through UAS by 2010 target value 150m.

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Maximise reach Share of profits

• Umbro Asia Sourcing
• Joint Ventures
• Royalty rate improvement.

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Inspire and excite the world of football