Mission: The integrated electrical system - gewiss.com

Mission: The integrated electrical system
Reuters code GEWI.MI
Bloomberg code GEWS IM
Company Data
Market MTA
Industry Electrical Products
(Bloomberg) MISC
Price EUR 5.795 (07/11/06)
N° shares 120,000,000
Market capitalization EUR 692.76 million
Free Float 22.6% (n° 27.1 ml)
Stock Performance (as 10/05/07)
1m 3m 1y
Gewiss 1.17% 1.29% 1.31%
Average daily volumes 42,727 58,404 56,192
2007 max Euro 6.666 (17 th April)
2007 min Euro 5.778 (5 th January)
2006 max Euro 6.562 (10 th May)
2006 min Euro 4.982 (3 rd January)
Contact:
GEWISS
MIBTEL
Marina Riva Tel. 02.72.02.35.35
m.riva@barabino.it
Key Figures 2003 - 1Q07
(Euro/Millions) 2003 2004 2005 2006 1Q06 1Q07
IAS IAS IAS IAS IAS
Gross turnover 315.1 326.0 329.4 326.5 77.5 83.9
Net turnover 300.2 308.7 314.6 308.3 74.3 80.2
EBITDA 66.9 78.8 81.5 72.1 18.2 18.5
EBIT 44.2 58.1 61.4 51.2 13.5 14.0
Net profit 17.2 31.2 37.2 30.7 8.0 8.3
Fixed assets 176.9 162.5 160.1 160.5 159.4 161.0
NWC 73.1 62.9 74.0 71.2 76.8 87.9
Net equity 178.8 207.4 235.3 256.1 243.2 264.5
NFP -55.2 -4.4 15.7 41.0 21.9 32.6
Dividends 0.05 0.08 0.08 0.1 - -
Cash flow 39.9 51.9 57.2 51.6 12.7 12.8
Financial Ratios
Net turnover (var. %) 1.0 3.5 1.0 -0.9 1.0 7.9
EBITDA % 21.2 24.2 24.7 22.1 23.5 22.0
EBIT % 14.0 17.8 18.7 15.7 17.4 16.7
Net profit % 5.5 9.6 11.3 9.4 10.3 9.9
NWC % 23.2 19.3 22.5 21.8 - -
Focus on quality, research and development
• Gewiss Group, listed on the Italian Stock Exchange (segment MTA standard) since
1998, is one of the leading European Groups operating in the electrotechnical
sector.
• Gewiss is an Italian multinational whose main activities stretch from the development to
the distribution of systems and parts for low voltage electrical installations.
The Group has a consolidated position also in the lighting sector where it produces
and distributes lighting equipment.
• Revenues by geographical breakdown, as of 31 December 2006, shows that the
main contribution to the Group’s revenues is generated by Italy, Gewiss’s core market
which accounts for 57.4% on total revenues followed by Europe with 36.8%.
• Innovation, safety and functionality are the hallmarks of Gewiss products.
Standards of quality are guaranteed by a major ongoing investment in R&D (more than
4% of turnover) followed by relative industrialization.
• Group’s strategy is focused on strengthening the direct sales network and the
partnership with the distribution chain and progressing the internationalization
project in Asia and Europe.
• Regarding this, it has to be pointed out that in October and November 2005 the commercial
branches Gewiss Turkey and Gewiss Russia, respectively, were established
and in March 2007 Gewiss Romania.
• The Gewiss Group, in 2006, reached a gross turnover of Euro 326.5 million, up 2.2% if
analysed on constant consolidation area, an EBITDA of Euro 72.1 million (EBITDA margin
of 22.1%) and a net income of Euro 30.7 million.
• The Gewiss Group, in the first quarter 2007, reached a gross turnover of Euro 83.9 million
(+8.3% YoY), an EBITDA of Euro 18.5 million (EBITDA margin of 22.0%) and a net
income of Euro 8.3 million.

Business
Market Overview
Operating performance
Company Profile
Gewiss Group, for over 30 years has been one of the Leading European players in the electrotechnical
sector. It specializes in developing and selling systems and parts for
low voltage electrical installation and lighting equipment.
Gewiss, is well recognize on the market for its wide range of products. With its “integrated
electrical system”, ranging from measurement and distribution board systems
to installation materials and trough to lighting equipment, Gewiss caters for the following
categories of users:
- Civil
- Tertiary
- Industrial
In 2006 both electronic and electrotechnical sectors have registered a 4% increase.
During 2006 the electrotechnical sector, after recent years characterized by general staticity,
has benefited from a benevolent macroeconomic context favourably influenced by the
building sector.As for the Italian market, estimates referring to the distribution channel are
confirming a discrete growth, although hardly influenced by both considerable competition
and the increasing incidence of the raw material costs ("copper effect").
Hereinafter the detailed elements featuring the electrotechnical sector in 2006, and which
could have an impact in the current year too, can be summarized as follows:
- fair growth of the Italian market but below the European average;
- fierce competition requiring to focus on continuous innovation, value added
production, brand equity and production efficiency;
- increasing incidence of the raw materials and the connected erosion of
margins;
- copying of low technological content products;
The year 2006 represented for Gewiss the climax of an important investing period which
has been indispensable for future development. Despite the modest revenues increase
(+2.2% on like-for like basis), the Group has registered a significant redditivity (partially
influenced by external conditions, the increase of personnel costs and by the level of capital
employed)
Euro/mln
350
340
330
320
310
300
311.9
Gewiss Group - Gross turnover
315.1
326.0
329.4
326.5
2002 2003 2004 IAS 2005 IAS 2006 IAS
Euro/mln
100
80
60
40
20
0
2
56.2
66.9
Gewiss Group - EBITDA
78.8
81.5
72.1
2002 2003 2004 2005 2006

Group structure
Gewiss Group has achieved a meaningful international presence, thanks to an internationalization
process allowing the Group to achieve 12 production plants (6 in Italy, 2 in
Germany, 1 in Portugal, 1 in France, 1 in India and 1 in China), 5 commercial branches
(UK, Spain, Turkey, Russia and Romania) and a central logistics centre in Italy
(Calcinate, BG) which handles deliveries throughout Europe in 48 hours.
100%
100%
100%
100%
100%
GEWISS
IBERICA SA
(Spain)
GEWISS
UK LTD
(UK)
GEWISS
ISTANBUL
E.T.M.T. LTD S.
GEWISS
O.O.O.
RUSSIA
GEWISS
ROMANIA
Srl (*)
Commercial Companies
3
100%
100%
100%
100%
50%
GEWISS
FRANCE SA
(France)
GEWISS
DEUTSCHLAND
GMBH
(Germany)
GEWISS
PORTUGAL
LDA
(Portugal)
GEWISS
ELECTRICAL DEVICES
(SUZHOU) CO LTD
(China)
C&S
GEWISS INDIA
(P) LTD
(India)
Commercial / Industrial Companies
(*) Established on 21st March 2007 with a share capital of 500,000 Euro fully paid up

The internationalization process has been carried out in two different phases (the second
phase still on going):
1) The first phase was characterized by the pan European expansion through
targeted acquisitions in Italy, Germany and France (worth a total of Euro 88.1 million):
- Feb 97 (GER) – Nowaplast:specialists in plastic trunkings for electrical systems;
- Sept 98 (ITA) – Dielectrix: manufacturer of trunkings, flexible and rigid pipes
and plastic accessories for electrical systems;
- May 99 (GER) – Schupa: manufacturer of miniature circuit breakers, residual
current devices and electrical distribution boards;
- June 99 (GER) – Merz: manufacturer of rotary switches and metal site boards;
- Oct 99 (FR) – Mavil: manufacturer of metal and plastic cable trays;
- July 00 (ITA) – Riverplast:specialized in thermoplastic moulding (acquisition
of a 20% investment);
2) The second phase involves Group expansion to Far-East area and consolidation of its
market share in Continental Europe:
- Feb 04 (INDIA) – C&S Gewiss India:50% Joint Venture for the production
and sale of the Gewiss catalogue in India addressed to a medium - high target of the
India electrotechnical market.
- Oct 04 (CHINA) – Gewiss Electrical Devices (Suzhou) Co Ltd:production
and trading company for the Far East area.
- Oct 05 (TURKEY) – Gewiss Istanbul E.T.M.T. LTD S.: Gewiss products trading.
- Nov 05 (RUSSIA) – Gewiss O.O.O.:Gewiss products trading.
- Mar 07 (ROMANIA) – Gewiss Romania Srl:Gewiss products trading.
4

Products
Catalogues
With more than 18,000 items, designed and created to work in synergy the
Gewiss Group provide the market with the "Integrated electrical system"
able to provide the best in terms of design and functionality for civil, tertiary
and industrial purposes.
In 2004, the Gewiss Group launched on the market some new lines of innovative products
on an international level, in particular the RESTART/AUTOTEST, the residual current
device with automatic reset device and weekly self-diagnosis, and the Wireless
device System RF.
In the international exhibition INTEL (June 2005) were launched the new domestic
range “Chorus” to manage and control your home (winner of the INTEL DESIGN 2005
award) and the led emergency lamps of the startec range and road fixtures with a facilitated
maintenance system.
At the end of 2006 the commercial launch, through two important events in Milan and
Rome, saw the participation of electronic and electrotechnical professionals and journalists:
over 1,500 people such as architects, distributors, installers experienced in
CHORUS' characteristics and advantages. An important space to the "domotic system"
has been dedicated at the International Sectorial Exhibition, LivinLuce, held in February
2007 Milan, registering remarkable interest from Italian and International operators.
Gewiss produtcs have been included in the following 5 catalogues:
EuroDOMO, a wide range of design products with advanced solutions for energy and
information distribution, security, safety and comfort management
EuroDIN, a technologically advanced offer of modular devices and modular case circuit
breakers, integrated with a wide range of enclosures, metal distribution boards and cabinets
making up Gewiss Protection System.
5

Business areas & segments
Research and Development
EuroBLOC, a leading range of industrial connections meeting most application requirements
and an integrated system of distribution panels for special, fixed or mobile electrical
plants, co-ordinated from an electrical, design and functional standpoint
EuroBOX, junction boxes and special enclosures sectors, co-ordinated series of surface
and flush-mounting distribution panels and boards
EuroLITE, lighting products advanced in technology and design, ideal for industrial and
road applications, indoor and outdoor decorative installations and emergency lighting
The 5 catalogues described above refer to three main areas of activity:
- Domotics (20.7% of 2006 Gross Turnover)
- Energy (71.8% of 2006 Gross Turnover)
- Lighting (7.5% of 2006 Gross Turnover)
Through its integrated electrical system, the Gewiss Group is able to offer a high level of
coverage of the activities listed below which go to make up the low voltage electrotechnical
segment:
- Residential system 95%
- Tertiary system 85%
- Industrial system 60%
Gewiss has achieved a sound market positioning thanks to the implementation of a marketoriented
structure to develop new products whose characteristics are:
- Innovation and design
- Maximum safety
- Functionality
This result can be attributed to the ongoing commitment to Research &
Development which can be detailed as follows:
- annual costs amounting to more than 4% of turnover
- 4 R&D divisions specialized according to catalogues (Domo, Din, Energy and Lite)
- approximately 200 full time dedicated employees (both internal and external)
6

Critical success factors
Strategy
Gewiss, has implemented a strategy focused on the following corporate areas in order to
achieve its current positioning and will continue to represent the driver for its future development:
- marketing and communication: boasts high communication content put across
using the most innovative and varied marketing tools (fairs, showrooms, working meetings,
electrician training courses, etc.)
- production innovation and design
- sales policy
- corporate efficiency: SAP, CRM, integrated logistics system
- high economic and financial capacity
At a sales level, the recent reorganization resulted in the following structure:
- sell-in: using an extensive distribution network formed of major buyer groups and
consortia;
- sell-out:creation of need in target market by publicizing Gewiss products through a
direct sales network, educating end customers and marketing activities.
Therefore the local sales network has been built up and is specific to each country.
Gewiss is concentrating on regaining shares of the French and German market, and
more generally on increasing penetration and therefore strengthening its positioning
in countries where Gewiss has been operating for a long time.
At the same time the Group is aiming at increasing its level of internationalization by
gaining control of new markets in the Mediterranean and Europe through partnerships,
local distributors and joint ventures.
Projects in China and India are of great importance since they offer significant potential
both with regard to increasing turnover and cutting costs.
7

Turnover
Ebitda
Ebit
2006 Financials
Consolidated Gross Turnover amounted to EUR 326.5 million, increasing by 2.2% on
FY05 revenues on like-for-like basis (-0.9% net impact of the MERZ GMBH deconsolidation,
disposed in December 2005). Positive contribution by the parent company
(+2.3%) and by the other Group subsidiaries, GEWISS FRANCE SA (+5.7%) and
GEWISS IBERICA (+7.7%), partially offset by the declining GEWISS DEUTSCHLAND
's turnover (-14.9%) owing to the diminished clientele base following Merz GMBH deconsolidation.
* IAS
Euro/mln
350
300
250
200
150
100
50
0
Euro/mln
300
275
250
225
200
140.7
171.2
Gewiss Group - Gross turnover
by geographical area
128.9
132.7 142.9 139.2
186.2 193.3 186.5
Consolidated EBITDA, amounting to EUR 72.1 million, passed from 24.7% on gross
turnover registered in 2005 to 22.1% in 2006. This variation is mostly attributable to the
increase in promotional incentives and to the variation in the value added owing
to supplying costs, advertising, marketing, commercial and personnel expenses
whose benefits, in terms of redditivity, will be registered in the next fiscal years
thanks to higher marginality new product mix.
Consolidated EBIT passed from EUR 61.4 in 2005 to EUR 51.2 million in 2006, with
an incidence on total revenues amounting to respectively 18.7% and 15.7%, owing to
considerable capital expenditure as per automation, moulds (Chorus) and industrial buildings.
8
187.3
2002 2003 2004* 2005* 2006*
235.5
Italy Abroad
Gewiss SpA - Gross turnover
265.3
285.1
284.2
294.0
2002 2003 2004* 2005* 2006*

Net Results
Net Working Capital
NFD
Shareholders structure
(18/05/07)
In 2006 Gewiss Group recorded net result for EUR 30.7 million (EUR 37.2 million in
2005) mostly due to higher tax rate (EUR 20.7 million).
Net working Capital improved, passing from 74.0 to 71.2, thanks to the increase of
short term liabilities as per EUR 6.2 million, of which EUR 4.2 million related to trade
payables and EUR 1.9 million as per other liabilities (payables to clients for promotional
incentives and payables to personnel), partially offset by the increase of inventory amounting
to EUR 6.4 million as a consequence of the creation of a stock for the launch of
Chorus foreseen for 1Q07.
Net Financial Debt is positive for EUR 41 million, improving by EUR 25.3 million, driven
by the cash generation for EUR 51.6 million and partially offset by capex (net of disposal)
of EUR 21.3 million and to dividend distribution of EUR 9.6 million.
Merrill Lynch
7.887%
Source: Consob
22nd May 2007
Arnhold and S.
Bleichroeder
Adviser llc.
7.506%
Market
17.600%
9
Bosatelli
Domenico
67.020%