For the year ended December 31

2003 2004 2005

20042006 2005 2006
Revenues 1,165 13,520 108,581 354,728 227%
Cost of sales 891 7,162 47,773 154,158
76% 53% 44% 43%
Gross profit 274 6,358 60,808 200,570
Selling, general, and administrative 1,471 7,929 33,916 105,224
126% 59% 31% 30%
Income (loss) from operations (1,197) (1,571) 26,892 95,346
Interest expense 3 47 611 567
Other (income) expenses—net - 19 (8) (1,847)
Income (loss) before income taxes (1,200) (1,637) 26,289 96,626
Income tax expense (benefit) - (143) 9,317 32,709
Net income (loss) (1,200) (1,494) 16,972 64,417
Dividend 142 275 33
Net income (loss) to common equity (1,200) (1,636) 16,697 64,384

Income (loss) per common share

Basic (0.03) (0.04) 0.26 0.87
Diluted (0.03) (0.04) 0.26 0.81
Average common shares (in millions)
Basic 41.71 49.28 50.99 74.60
Diluted 41.71 49.28 67.14 80.17
2007 (est.)
847,350
349,701
41%
497,649
259,882
31%
237,767
438
(2,997)
240,326
72,098
168,228

168,228

2.08
2.00

80.76
84.19
Cash Flow Forecast 2006 2007 2008
Revenues 355 830 996
Cost of sales 154 342 410
Gross profit 201 488 586
Selling, general, and admin. 105 251 301
Operating income 95 237 284
NOPAT (tax at 30%) (85)
NWC (72)
NPPE (55)
Depreciation 8
Free cash flows 80

Terminal Value 5,766.84

Pv of Terminal Value 3,422.34
PV of Cash flows 501.77
Enterprice Present Value 3,924.11
Value of Share 46.61
 2009 2010 2011 2012
1,195 1,374 1,581 1,739
492 566 651 716
703 808 929 1,022
361 416 478 526
341 392 451 496
(102) (118) (135) (149)
(118) (146) (116) (40)
(63) (73) (58) (20)
21 21 31 42
79 77 173 330
Cash Flow Forecast 2006 2007 2008 2009 2010
Revenues 355 $830
830 1,370 2,058 2,788
342
Cost of sales 154 342 589 885 1,227
Gross profit 201 488 781 1,173 1,562
Selling, general, and admin. 105 251 425 659 920
Operating income 95 237 356 514 641
NOPAT (tax at 30%) 249 360 449
Ch NWC 72 118 146
Ch NPPE 55 63 73
Free cash flows 122 178 230

Growth % 227.00% 134.00% 65.00% 50.30% 35.50%

COGS/Sales % 43.50% 41.20% 43.00% 43.00% 44.00%
SGA/Sales % 9.70% 30.20% 31.00% 32.00% 33.00%
NWC as % of sales 1.30% 26.60% 21.40% 20.00% 20.00%
NFAssets as % of sales 16.40% 10.50% 10.40% 10.00% 10.00%
Deprec. as % of NFassets 13.80% 24.10% 15.00% 15.00% 15.00%
Net working capital 47 221 293 412 558
Net fixed assets 58 87 142 21,346 279
Depreciation /amortzatioo 8 21 21 31 42
EBITDA 103 258 377 545 683
Net income (loss) 64 168 249 360 449
 2011 2012
3,367 3,569
1,515 1,606
1,852 1,963
1,111 1,178
741 785
519 550
116 40
58 20
345 489

20.80% 6.00%
45.00% 45.00%
33.00% 33.00%
20.00% 20.00%
10.00% 10.00%
15.00%
673 714
337 357
51
791
519
 2005 2006
ASSETS
Cash and cash equivalents 4,787 45,546
Short-tom investments - 22,325
Accounts receivable (net) 17,641 65,588
Inventories 28,494 86,210
Deferred tax assets 1,939 3,690
Prepaid expenses and other current assets 3,492 14,332
Total current assets 56,353 237,691
Property and equipment-net 14,765 34,849
Goodwill 336 11,552
Intangible assets-net 5,311 12,210
Deferred tax assets-net 1,084 1,280
Other assets 183 1,875
Total Assets 78,032 299,457
LIABILITIES
Accounts payable 20,829 43,794
Accrued expenses and other current liabilities 16,875 43,574
Notes payable and current installments of long- 8,601 541
term debt
Total current liabilities 46,305 87,909
Long-term debt 3,422 116
Deferred tax liabilities 1,772 1,688
Other liabilities 319 1,486
Total liabilities 51,818 91,199
Redeemable common shares 1,800
Redeemable convertible preferred shares 5,500
Common shares, par value $0.001 per share 17 39
Additional paid-in capital 13,976 131,834
Deferred compensation (12,364) (5,702)
Retained earnings 16,697 81,081
Accumulated other comprehensive income 588 1,006
Total stockholders' equity 18,914 208,258
Total Liabilities and Stockholders' Equity 78,032 299,457
Company EPS' EBITDA1 Sales' CAGR COGS to SGA
Sales= Sales to Sales
Primarily Footwear
Deckers Outdoor 4.52 90 400 32.00% 57.20% 26.20%
Nike 3.32 2,542 17,643 11.10% 56.90% 30.10%
Timberland 0.93 116 1,312 7.10% 52.50% 33.90%
16.70% 55.50% 30.10%
Primarily Apparel
Columbia Sportswear 3.70 205 1,263 12.10% 55.20% 27.10%
Lululemon 0.41 57 251 101.80% 48.30% 46.50%
Quiksilver 0.60 199 2,095 20.30% 53.80% 36.10%
Under Armour 1.02 98 612 71.70% 52.90% 36.00%
VF Corp 5.32 1,015 6,796 5.10% 59.60% 27.60%
Volcom 1.39 54 268 37.70% 51.40% 28.80%
Zumiez 0.94 56 383 36.20% 66.10% 25.10%
40.70% 55.30% 32.50%
Established Apparel
Brands
Liz Claiborne (191.00) (263) 4,521 4.30% 53.00% 38.50%
Phillips-Van Heusen 3.10 348 2,010 10.70% 56.00% 36.30%
Jones Apparel Group 1.25 (27) 3,840 -2.30% 63.90% 26.20%
Warnaco Group 1.70 231 1,825 4.50% 64.00% 28.40%
4.30% 59.20% 32.40%
 2007 2006
EPS' 2.00 0.81
EBITDA 237.77 209.00
Sales' 847.35 355.00
COGS to Sales 43% 43%
SGA to Sales 31% 30%
Price 47.74 20.00
Shares 84.19 80.17
Market Cap 4,019.23 1,603.40
Value of debt 91,199.00 51,818.00
P/E 23.87 24.69
EV / EBITDA 16.50 -
EV / Sales 4.63 -
Company Price Shares Market Cap Value of
Nov. 2 debt P/E EV / EBITDA
Primarily Footwear
Deckers Outdoor 127 13 1,651 - 28.08 18.37
Nike 62 499 30,847 441 18.64 12.31
Timberland 17 62 1,039 41 18.02 9.29
21.58 13.32
Primarily Apparel
Columbia Sportswear 48 36 1,763 19 13.06 8.70
Lululemon 42 72 2,974 101.20 51.99
Quarsifrer 12 125 1,490 75 19.80 11.16
Under Armour 50 50 2,524 10 49.46 25.93
VF Corp 76 110 8,304 1,145 14.19 9.31
Volcom 25 24 613 18.06 11.41
Zumiez 28 29 795 29.46 14.09
35.03 18.94
Established Apparel
Brands
Liz Claiborne 25 95 2,414 521 NA NA
Phillips-Van Heusen 42 56 2,367 400 13.52 7.95
Jones Apparel Group 18 85 1,513 777 14.50 NA
Warnaco Group 38 44 1,749 310 22.55 8.91
16.86 8.43
 Change in
EV / Sales price

4.13 -9.10%
1.77 -6.70%
0.82 -13.90%
2.24

1.41 -0.80%
11.86 -22.00%
1.06 -11.90%
4.14 -19.00%
1.39 -13.30%
2.28 -14.30%
2.07 -33.80%
3.46

0.65 -7.80%
1.38 -11.50%
0.60 7.20%
1.13 -2.70%
0.94