Financial statements Marcolin Group

Financial statements
Marcolin Group Group
December 31st 2004

2
Consolidated Annual Report & Accounts

Registered offi ces:
Marcolin Group
Consolidated Annual
Report & Accounts
of the Marcolin Group
for the year ending on
December 31st 2004
Vallesella di Cadore (BL)
Domegge di Cadore - Italy
Share capital: EUR 23,596,560.00
fully paid in Tax code and Belluno
Companies Register no.: 01774690273
REA (Repertory of Economic
3
& Administrative Information) no. 64334

4
Consolidated Annual Report & Accounts

7
8
10
11
12
24
27
30
53
54
74
84
87
90
118
126
INDEX
Corporate bodies and offi cers
Structure of the Marcolin Group
Marcolin stock market performance
Shareholder structure
Report on operating performance of the Marcolin Group in the year ending on December 31st 2004
Consolidated balance sheet at December 31st 2004
Consolidated income statement for the year 2004
Explanatory notes to consolidated accounts for the year ending on December 31st 2004
Consolidated statement of cash fl ows
Attachments to consolidated annual report & accounts
Report on operating performance for the year ending on December 31st 2004 Marcolin S.p.A.
Balance sheet as at December 31st 2004
Income statement as up to December 31st 2004
Explanatory notes to statutory accounts for the year ending on December 31st 2004
Attachments to statutory annual report and accounts
Marcolin S.p.A. statement of cash fl ows
Marcolin Group
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Consolidated Annual Report & Accounts

CORPORATE BODIES AND OFFICERS
BOARD OF DIRECTORS (1)
Chairman and Executive Director Giovanni Marcolin Coffen
Vice Chairman and Executive Director Cirillo Coffen Marcolin
Executive Director Maurizio Coffen Marcolin
Executive Director and General Manager Antonio Bortuzzo
Executive Director Sandro Bartoletti
Director Maurizio Dallocchio
Director Enrico Petocchi
Director Emanuele Alemagna
Director Giorgio Drago
REMUNERATION COMMITTEE
Emanuele Alemagna
Giorgio Drago
Maurizio Dallocchio
President
INTERNAL AUDITING COMMITTEE
Maurizio Dallocchio
Giorgio Drago
Emanuele Alemagna
President
BOARD OF STATUTORY AUDITORS (1) (1)
President Diego Rivetti
Standing statutory auditor Osvaldo Galeazzo D’Ambrosi
Standing statutory auditor Rino Funes
Substitute statutory auditor Emilio Grazioli
Substitute statutory auditor Giannantonio Guazzotti
INDEPENDENT AUDITOR
Pricewaterhouse Coopers S.p.A. (2)
Marcolin Group
(1) Term of Offi ce: FYs 2004 - 2006 (as decided by Extraordinary Shareholder Meeting on April 29th 2004)
(2) Duration Duration of appointment: FYs 2002 - 2004 (as decided by Annual General Shareholder Meeting on April 39th 2002)
NATURE OF POWERS ATTRIBUTED TO INDIVIDUAL DIRECTORS:
The Chairman, Vice Chairman and Executive Director Maurizio Coffen Marcolin have been vested with ample
powers, within certain limits, of management and representation. The executive directors Antonio Bortuzzo and
Sandro Bartoletti have been vested, to a more limited extent, with powers of ordinary management in the sphere
of recurrent operations.
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Consolidated Annual Report & Accounts
STRUCTURE OF THE MARCOLIN GROUP

0.10%
Marcolin & Co S.p.A.
Italy
Marcolin Iberica S.A.
Spain
Marcolin Portugal Lda.
Portugal
Marcolin Benelux S.p.r.l.
Belgium
Marcolin U.K. Ltd.
England
Marcolin France S.a.r.l.
France
Marcolin Deutschland GmbH
Germany
Marcolin GmbH
Switzerland
Marcolin do Brasil Ltda.
Brasil
Finitec S.r.l.
Italy
99.96%
100.00%
99.82%
99.98%
99.88%
99.99%
100.00%
100.00%
99.90%
40.00%
Marcolin S.p.A.
100.00%
Marcolin International B.V.
100.00%
Marcolin Asia Ltd.
Hong Kong
14.60%
85.40%
Marcolin U.S.A. Inc.
CEBE Scandinavia A.B.
Sweden
CEBE Japan Ltd.
Japan
CEBE Sport S.A.
Switzerland
Marcolin Group
CEBE S.A.
France
100.00%
100.00%
99.00%
100.00%
9

10
Consolidated Annual Report & Accounts
MARCOLIN STOCK MARKET PERFORMANCE
Source: www.borsaitalia.it
The shares of Marcolin S.p.A. have been listed on Milan’s electronic equity market
(Mercato Telematico Azionario - MTA) since July 1999.
The above chart shows the stock’s performance from January 1st to December 31st 2004.

Andrea Della Valle
17.718%
Diego Della Valle
17.718%
Dolce & Gabbana Group
4.998%
* Marcolin Marcolin family
Market
24.130%
Marcolin Group
SHAREHOLDER STRUCTURE
Coffen Marcolin Maurizio *
Coffen Monica
5.120%
*
7.400%
(based on voting rights)
Zandegiacomo Maria Giovanna *
2.627%
Coffen Giovanni Marcolin *
15.168%
Share capital consists of 45,378,000 ordinary shares with a nominal value of 0.52 each for a total amount of
€ 23,596,560.00.
The data shown above are updated to March 17th 2005.
Coffen Marcolin Cirillo *
5.120%
11

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Consolidated Annual Report & Accounts
REPORT ON OPERATING PERFORMANCE OF THE MARCOLIN GROUP
IN THE YEAR ENDING ON DECEMBER 31 31ST ST 2004

To Our Shareholders
Marcolin Group
Before starting our report, we wish to point out that the company - taking advantage of the possibility given by
Article 82, paragraph 2, letter b), of the CONSOB (Italian listed company & stock market surveillance commission)
Regulation 11971/1991 and its subsequent amendments and additions - has not drafted or prepared a quarterly
report for the fourth quarter of 2004. Consequently, it will make a copy of the consolidated and statutory annual
reports and accounts available at the company’s registered offi ces and at those of Borsa Italiana S.p.A. within the
terms indicated in the aforementioned regulation.
Background
Before moving on to illustrate the group’s business and fi nancial results, we think it appropriate to mention some
events occurring during FY2004 and in the early months of FY2005 that we believe will infl uence the group’s
activities and results during FY2005 and in subsequent fi nancial years.
First of all it has to be noted that, in October 2004, the licensor Dolce & Gabbana advised of its intention of not
renewing the license contract, due to expire on December 31st 2005, for the lines Dolce & Gabbana Eyewear and
D&G Dolce & Gabbana Eyewear.
In view of the importance of Dolce & Gabbana lines for the group in terms of both sales (about 50% of sales in
2004) and margin, management believes that, although this announcement did not have any signifi cant P&L
impact in FY2004, a short-term reduction in sales and margin is possible, particularly if we do not succeed in
offsetting the loss of these licenses with fast-track entry of new brands and/or with the development of lines
currently in our portfolio.
This event has led management to (i) plan all activities for transition of the Dolce & Gabbana licenses until the
expiry date to minimise possible risks of lost sales or the onset of extra costs and (ii) intensify efforts designed to
acquire new licenses on a fast-track basis. Negotiations are currently underway in this respect.
At the same time it is also appropriate to highlight a series of positive factors leading management to be confi dent
of the group’s good possibilities of development in the medium term:
• On October 6th 2004 an agreement was signed envisaging, as from January 1st 2005, production and
distribution in the U.S.A. in the optician channel of the prescription eyewear and sunglass lines Kenneth
Cole New York and Reaction Kenneth Cole. The contract has a 3-year duration with the possibility of
renewal.
• On December 1st 2004 an agreement was signed concerning extension until December 31st 2010 of the
license relationship concerning the Roberto Cavalli Eyewear line (expiry of which had originally been
set for December 31st 2007). On the same date we also signed a new license agreement (with expiry once
again fi xed for December 31st 2010) for the Just Cavalli Eyewear line.
The sales that will be achieved with the new licenses mentioned above (Kenneth Cole and Cavalli) will
make it possible to offset in part the loss of the Dolce & Gabbana licenses.
• On December 23rd 2004 we signed an agreement with the Luxottica Group, approved by Dolce &
Gabbana, defi ning transition of the Dolce & Gabbana Eyewear and D&G Dole & Gabbana Eyewear
lines so as to facilitate the switch of distribution from Marcolin to the Luxottica Group, in view of
license expiry, to the benefi t of all customers.
This transitional agreement was desirable in order to avoid incurring signifi cant costs relating to the
presentation of new collections close to license expiry, sales of which by the Marcolin Group will in any
case be terminated by the end of the year.
The agreement envisages that, as from October 1st 2005 and until December 31st 2005, although
Marcolin will retain ownership of its contract with Dolce & Gabbana with effect until December 31st
2005, the Luxottica Group will take over sale of a signifi cant portion of products, currently made and
distributed by Marcolin (in particular as regards prescription eyewear), paying the licensor, in Marcolin’s
place, royalties on sales achieved in the period concerned.
By means of this agreement Marcolin will obtain the benefi t (calculated as being some € 1.8 million) of
not paying part of minimum guaranteed royalties for the last quarter to Dolce & Gabbana.
13

14
Consolidated Annual Report & Accounts
Another outstanding event to be highlighted was the entry, in November 2004, into Marcolin S.p.A.’s shareholder
group of the brothers Diego and Andrea Della Valle (well-known industrialists active in the luxury sector), via the
companies they own, with a total equity interest of some 24%.
Following this entry, on December 16th an accompanying voting and block pact - concerning Marcolin S.p.A.’s
controlling shareholding - was concluded between the Della Valle brothers and the Marcolin family - the company’s
historical key shareholders. The Della Valle brothers’ entry into capital will make it possible to make the Marcolin
core shareholder group stable over time, also enabling the company to benefi t from important contacts and
relationships at the international level in the fashion and luxury sector. This should facilitate fast-track acquisition
of new licenses and further development of those already forming part of our portfolio, as well as contribute
further managerial skills to assure growth of group business in the medium term.
Stipulation of the accompanying pact, with contribution to the same of some 53.6% of the shares issued by Marcolin S.p.A.,
led to the obligation for pact members to launch a mandatory public tender offer (“PTO”) for all Marcolin S.p.A.
shares at a per-share price of € 1.40. The PTO ended on February 11th 2005 and payment of shares handed over
for the PTO was executed on February 17th 2005.
By virtue of this operation, the shares currently contributed to the pact account for approximately 70.872% of
share capital. They are evenly divided between the two groups of shareholders, the Marcolin family on the one
hand and the Della Valle brothers on the other.
The combined effects on the group’s business results of all the items highlighted above can be fully estimated
presumably only at the end of the fi rst half of 2005, by which time some negotiations underway for new licenses may
come to fruition and it will also be possible to assess the full effects of transition of the Dolce & Gabbana licenses.
For further details concerning the effects of non-renewal of the Dolce & Gabbana licenses on FY2005, reference
should be made to the section concerning signifi cant events after year-end and expected business progress.
Analysis of operating performance
The year ending on December 31st 2004 showed consolidated sales of some € 173,200 thousand (k) (vs. some
€ 157,294k in 2003), with an increase of 10.1% YoY. EBITDA amounted to some € 17,193k with a margin of about
10% on sales (vs. some € 10,046k or 6.4% on sales in the year ending on December 31st 2003). Consolidated net
profi t totalled approximately € 1,159k vs. a loss of some € 4,152k in the year ending on December 31st 2003.
Sales analysis
As regards sales fi gures divided by geographical area we note that products are marketed via the following
distribution channels:
• Italy, European countries with affi liates, and North America: opticians, sports stores and chains;
• Rest of the World: distributors and chains.
Sales breakdown by geographical area:
AREA 31.12.2004 31.12.2003 Difference
(Euro/thousand) Turnover % on total Turnover % on total Difference %
Geographical area
- Italy 40,451 23.35 32,804 20.86 23.31
- Europe 78,644 45.41 73,485 46.72 7.02
- U.S.A. 35,074 20.25 34,380 21.86 2.02
- Rest of the world 19,033 10.99 16,625 10.57 14.48
Totale 173,202 100.00 157,294 100.00 10.11

Marcolin Group
Analysis of sales by geographical area shows the major increase achieved in the domestic market, i.e. about +23%
(some € 7,647k in outright terms); the overall recovery achieved in the U.S. market (+2%, about +12% based on
straight-line exchange rates); the constant growth achieved in the markets of other European countries with a sales
increase of some +7% vs. 2003 (about € 5,159k in outright terms); and the satisfactory performance reported in the
rest of the world with an increase of about 14.5% YoY.
Taking a closer look at fi gures, the increase in consolidated sales was mainly ascribable to the sales increase
reported by the parent company - about € 12,577k (+15%), by the Spanish affi liate - about € 2,076k (+18%), by the
American affi liate - about € 1,769k (+5%), and by the French affi liate - about € 1,419k, which was set against the
decrease of some € 1,042k of Cébé S.A. (-4%).
The signifi cant increase in sales over the previous year was even more appreciable in the light of the adverse trend
of the euro, which revalued by some 10% on average against the U.S. Dollar. Applying the same exchange rate as
reported in 2003, the group’s sales would have in fact increased by about 12% as opposed to the +10% achieved at
actual exchange rates.
Contributors to the good 2004 sales trend were, thanks also to the new collections presented, excellent growth of
the “Roberto Cavalli Eyewear” line (+74%) and the good results of the “Dolce & Gabbana Eyewear” line (+24%)
and “D&G Dolce & Gabbana Eyewear” line (+11%), as well as the American “Kenneth Cole” line and the launch of
Timberland, sales of which started in May 2004.
These fi gures confi rm consolidation of market share reached by the Marcolin Group in Europe and in the rest of
the world, and recovery in the American market. This was achieved in a competitive scenario featuring a persistently
diffi cult consumer-spending environment.
Analysis of consolidated operating results:
PROFIT & LOSS STATEMENT 31.12.2004 31.12.2003 delta
(Euro/thousand)
Revenues from sales and services 173,202 100% 157,294 100.0% 10.1%
Other income 2,617 1.5% 2,557 1.6% 2.4%
Total revenues 175,819 101.5% 159,850 101.6% 10.0%
Cost of sales (118,241) 68.27% (108,111) 68.7% 9.4%
Value added 57,578 33.2% 51,739 32.9% 11.3%
Personnel costs (40,385) 23.3% (41,693) 26.5% -3.1%
Gross operating margin (EBITDA) 17,193 9.9% 10,046 6.4% 71.1%
Provision and depreciation (2,394) 1.4% (2,166) 1.4% 10.5%
Amortizations (5,573) 3.2% (6,833) 4.3% -18.4%
Operating profi t (EBIT) 9,227 5.3% 1,046 0.7% 781.7%
Financial income and charges (3,071) 1.8% (4,767) 3.0% -35.6%
Extraordinary income and expenses (132) 0.1% (140) 0.1% -6.0%
Profi t (loss) before taxes 6,024 3.5% (3,861) 2.5% -256.0%
Income taxes for the period (4,865) 2.8% (291) 0.2% 1.573.2%
Profi t (loss) for the period 1,159 0.7% (4,152) 2.6% -127.9%
15

Group business areas
The Marcolin Group is structured in two operating areas, i.e.:
• Manufacturing and sale of prescription eyewear and sunglasses (Marcolin and its affi liates);
• Manufacturing and sale of ski goggles, sports eyewear, and sports accessories (Cébé).
Marcolin Group
Information concerning the two areas is highlighted in the table below (amounts are shown in Euro/thousand):
BALANCE SHEET Cébé Marcolin & Subsidiaries
(Euro/thousand) 31.12.2004 31.12.2003 31.12.2004 31.12.2003
Assets
Fixed assets 1,805 1,842 25,611 27,741
Current assets 24,034 25,353 102,448 103,601
Prepayments and accrued income 221 408 2,038 2,011
Total 26,060 27,604 130,097 133,353
Shareholders’equity and liabilities
Shareholders’equity 3,807 4,881 49,777 48,461
Share capital and reserves attributable
to minority interests
0 0 0 0
Provisions for contingencies and staff
leaving indemnity
438 462 6,834 6,180
Payables 21,809 22,257 71,881 77,485
Accrued liabilities and deferred charges 5 3 1,606 1,227
Total 26,060 27,604 130,097 133,353
As regards Cébé, sales - as highlighted earlier - decreased by some -4% YoY, with EBITDA that went down from
about € 1,207k to about € 65k, and a net loss in the period of € -1,085k. The negative trend in operating results in
the sports sector was infl uenced by the investments made to support the The North Face line, as well as by sale
increased of lower-margin merchandise categories (and in particular of ski helmets).
The decrease in sales was also adversely impacted by back-order problems caused by delays in procurement of
some production input items - mainly plastics - with consequent delays in delivery of collections during 2004.
Given the negative results reported by Cébé and the aforementioned operational problems, already during 2004
the parent company’s management started in-depth analysis and verifi cation, with the aim of taking incisive
managerial action designed to achieve recovery of the subsidiary’s profi tability. A plan is currently being devised
to reorganise production activities performed by the subsidiary.
As regards the sunglass and prescription eyewear sector, the positive results achieved stemmed from the success
of lines in our portfolio and from increased commercial penetration in European markets - particularly in Italy,
Greece, and Spain. In non-European areas we note the considerably growth achieved in Australia. In addition,
close attention to limitation of overhead costs at group level also made a signifi cant contribution to improvement
of profi t margins.
The Marcolin Group’s main operating costs are shown below:
17

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Consolidated Annual Report & Accounts
COSTS 31.12.2004 31.12.2003
(Euro/thousand)
Raw materials, consumables, fi nished products costs -48,101 -52,219
Service costs -48,504 -49,295
Leasing and rental -16,219 -13,885
Personnel cost -40,385 -41,693
Depreciations and devaluations -7,101 -8,719
Interests and other fi nancial charges -4,034 -3,956
Profi t (loss) on exchange rate 1 -1,946
TOTAL -164,343 -171,713
As regards the above data, we note that:
• The cost for raw and ancillary materials decreased by some 8% YoY. We point out that, during 2004, the
parent company reclassifi ed some costs concerning the purchase of components - previously included
among costs for outsourced processing (Item B7 - service costs - in year-end fi nancial statements) - in
order to represent the costs borne for this cost item better. Applying the same accounting policy as that
adopted during 2004, costs of raw and ancillary materials and of fi nished products as at December 31st 2003
would have totalled some € 55,656k and therefore, as at December 31st 2004, would have decreased by
some € 7,555k. This reduction stemmed from more rational inventory management, especially by our
U.S. affi liate, together with the effect of the €/USD exchange rate.
• Service costs decreased by a total of about € 791k. Considering the reclassifi cation mentioned earlier,
we note that - with application of the same accounting policy as that adopted in 2004 to fi gures as at
December 31st 2003 - service costs would have increased by about € 2,646k. This change was mainly due
to high sales volume achieved during 2004 with an incidence on sales of some 28%, substantially in line
with the previous FY (about 29%).
• Leasing, rental and royalty costs increased by some 16.8% over the previous FY, rising from € 13,855k as
at December 31st 2003 to € 16,219k as at December 31st 2004.
The change versus the previous FY in terms of incidence on sales - up from approximately 8.8% in 2003
to about 9.4% in 2004 - was due to the increase of the cost of royalties paid to licensors.
• Payroll costs decreased by some € 1,308k over the previous FY (about -3.1%). This reduction is explained
by the combined effect of (a) reduction of the U.S. affi liate’s payroll costs by some € 2,257k, based on the
reorganisation plan and (b) a cost increase for some group companies, including Marcolin S.p.A., with
the increase in the latter case also being due to renewal of the national collective labour contract.
• The amount of interest and other fi nancial charges did not change signifi cantly compared with the
previous year.
• The balance of foreign-exchange gains and losses was substantially at breakeven as opposed to a loss
of some € -1,946k at the end of the previous FY. The considerable improvement was mainly due to
exchange-rate differences (above all as regards the U.S. Dollar), also in relation to hedging transactions
undertaken during the year.

Review of balance sheet and fi nancial position
Marcolin Group
FINANCIAL POSITION 31.12.2004 31.12.2003
(Euro/thousand)
Treasury Stock 947 760
Cash on hand 9,280 14,439
Total fi nancial liquidity 10,227 15,199
Current payables due to banks -23,656 -29,156
Medium/long-term payables due to banks -29,973 -28,877
Other fi nancing payables -1,123 -1,073
Total borrowings -54,753 -59,107
Net Financial Position -44,526 -43,908
The negative balance of the net fi nancial position (NFP) at year-end showed an increase of some € 618k over that
shown as at December 31st 2003.
First of all it should be stressed that NFP at the end of the previous FY benefi ted from no-recourse factoring of
trade payables totalling about € 7,712k. Given this, based on like-for-like conditions, the consolidated NFP as at
December 31st 2003 would have been € 51,620k with 2004 improving by some € 7,094k.
This signifi cant improvement was mainly ascribable to operating results, which generated positive total cash fl ow
- as highlighted in the cash fl ow statement attached to the report - of some € 7,717k, plus tighter control of net
working capital (NWC) items.
We in fact note that - notwithstanding the increase in business turnover - the entity of receivables, without
considering factoring transactions, increased less than proportionally over the previous FY thanks to the reduction
of average days of sale outstanding and constant attention to credit. As regards year-end inventories, the fi gures
show a reduction in inventory levels thanks to improved inventory management.
We also highlight that, during 2004, we made new investments totalling some € 4,652k - mainly for the new ERP
system (some € 2,009k), and for replacement of plants (about € 166k) and commercial & industrial equipment
(about € 1,468k) - most of which were undertaken by the parent company.
As far as debt breakdown is concerned, we note further consolidation of the medium- and long-term portion vs.
the end of 2003, via increased utilisation, by € 12 million (mn), of the revolving stand-by credit facility, received for
a total of € 20 mn and based on a loan contract signed at the end of 2003.
As at December 31st 2004 total utilisation of the aforementioned credit facility amounted to € 17 mn.
We further note that, during the year, the parent company repaid principal totalling some € 8,234k for loans
granted in previous years.
We point out that all loans in place were granted at going market rates without provision of collateral.
In order to round off analysis of the composition of the group’s fi nancial status, we note that the group’s net debt/equity
ratio remained balanced and unchanged vs. December 31st 2003 at 0.83.
For the sake of clarity, it is noted that the 2003 ratio - based on NFP net of factoring - would have been 0.96.
The following table summarises consolidated balance sheet fi gures.
19

20
Consolidated Annual Report & Accounts
BALANCE SHEET Marcolin Group
(Euro/thousand) 31.12.2004 31.12.2003
Assets
Fixed assets 27,417 29,583
Current assets 126,482 128,954
Prepayments and accrued income 2,259 2,419
Total 156,157 160,957
Liabilities
Shareholders’equity 53,584 53,342
Share capital and reserves attributable to minority interests 0 0
Provisions and payables 100,962 106,385
Accrued liabilities and deferred charges 1,611 1,230
Total 156,157 160,957
Moving on to analyse consolidated balance sheet items, we note that the decrease, of some € 2,167k, in the value of
fi xed assets was mainly due to depreciation & amortisation and to foreign-exchange translation differences.
Intangible fi xed assets include trademarks for a residual value of € 2,821k (of which € 1,690k referring to Cébé
and € 1,131k to Marcolin U.S.A. Inc.) and goodwill (posted among Consolidation Differences) totalling € 6,186k
(of which € 802k referring to Cébé and € 5,824k to Marcolin U.S.A. Inc). This fi gures were originally posted on the
basis of appraisals made by specialised independent fi rms and were confi rmed by impairment tests performed in
subsequent years, as was also done in the FY ending on December 31st 2004.
As regards the Cébé subsidiary, we point out that valuation is supported by a business plan for the 2005-2008 period.
Once again, for the investee company Marcolin U.S.A. Inc. we note that the impairment test was supported by an
appraisal made by independent consultants, which in turn was based on management’s projections concerning
the subsidiary’s business and fi nancial prospects (2005-2009 business plan), as well as on operating action taken
and the effects of reorganisation currently underway.
As regards current assets, there was a total decrease vs. FY2003 of some € 2,472k, mainly caused bythe
following changes:
• Inventories decreased by about € 5,067k
• Receivables increased by some € 7,556k
• Cash & banks decreased by approximately € 5,159k.
Provisioned reserves and payables decreased by some € 5,423k vs. FY2003. As specifi cally concerns payables, the
main changes were due to:
• A decrease in bank payables of some € 4,404k
• A decrease in trade payables of about € 3,953k
• An increase in tax payables and amounts payable to social security agencies of some € 2,627k.
The average group employees headcount decreased from 1,084 in FY2003 (of which 220 in Marcolin U.S.A. Inc.
and 234 in the Cébé Group) to 1,062 resources employed during 2004 (of which 203 in Marcolin U.S.A. Inc. and
241 in the Cébé Group).
As required by Article 40 of Italian Legislative Decree 127/1991, we advise that, as at December 31st 2004,
Marcolin S.p.A. held 681,000 of its own shares (treasury stock) for a nominal total amount of € 351,120. Their book
value was € 946,589.12 and included a write-back of € 186,593.12 made to align the stock’s book value - written
down in previous FYs - with its market price as at December 31st 2004. Stock held by the company accounts for
approximately 1.50% of Marcolin S.p.A.’s share capital.

Marcolin Group
In accordance with the requirements of paragraph II of Article 2428 of the Italian Civil Code and of Article 40 of
Italian Legislative Decree 127/1991, we advise that, during the year, commercial transactions took place, at normal
market rates, with the associated company Finitec Srl, which is not included in the scope of consolidation.
No other group company has ever purchased shares forming part of the parent company’s share capital.
Research and development activities
R&D activities are performed using two divisions. The fi rst of these, consisting of a centralised organisation (based
in Treviso) has the tasks of creation - in close collaboration with licensors - of new collections, styling, research
into new materials, and development of collections for sunglasses, prescription eyewear, and sports eyewear.
The second, which works closely with the other division, handles product development and industrialisation.
Under Italian Law no. 46 of February 17th 1982, the company has been considered eligible to benefi t from the
revolving technological innovation fund for a total cost of about € 1,652k - which can be issued in the form of
low-rate fi nancing and grants. We fi led application based on a project for the study and development of new
technologies applicable to the sector of alpine goggles and eyewear. During the year the parent company thus
received a loan of some € 793k and a grant of about € 78k.
In compliance with Attachment 3C, Template 3 of CONSOB Regulation no. 11971 dated 14/5/1999, below we list
the equity interests owned in group companies by the directors, statutory auditors, and general managers as at the
year-end date of December 31st 2004. We have therefore not taken into account effects following the outcome of
the Public Tender Offer mentioned earlier.
Name Partecipated companies No. of
shares
held at
31.12.2003
Giovanni Marcolin Coffen Marcolin S.p.A.
Cébé S.A.
Marcolin & Co. S.p.A.
Cirillo Coffen Marcolin Marcolin S.p.A.
Marcolin France S.a.r.l.
Marcolin U.K. Ltd.
Cébé S.A.
Marcolin Portugal Lda.
Maurizio Coffen Marcolin Marcolin S.p.A.
Cébé S.A.
Marcolin Benelux S.p.r.l.
Maria Giovanna Zandegiacomo Marcolin S.p.A.
Cébé S.A.
* The 6,882,876 shares indicated in the table for Mr. Giovanni Marcolin Coffen relate to the latter’s usufruct rights on an equal number of shares, the bare
ownership of which is held by the company Inmar International S.A., controlled by him.
** The 1,474,785 shares shown in the table for Mr. Cirillo Coffen Marcolin relate to the latter’s usufruct rights on an equal number of shares, the bare
ownership of which is held by Inmar International S.A.
*** The 1,474,785 shares shown in the table for Mr. Maurizio Coffen Marcolin relate to the latter’s usufruct rights on an equal number of shares, the bare
ownership of which is held by Inmar International S.A.
**** The 930,183 shares shown in the table for Mrs. Maria Giovanna Zandegiacomo relate to the latter’s usufruct rights on an equal number of shares, the
bare ownership of which is held by Inmar International S.A.
(1) Executive Director and General Manager of Marcolin S.p.A.
18,430,416
1
465
3,179,533
4 share
1 share
1
1 share
3,179,533
1
1 share
Purchase Sale No. of
shares
held at
31.12.2004
11,547,540 6,882,876 *
1,704,748 1,474,785
4 share
1 share
1
1 share
**
1,704,748 1,474,785
1
1 share
***
1,435,659 ** 505,476 930,183 ****
1
1
Antonio Bortuzzo (1) Marcolin S.p.A. 56,000 40,000 61,600 34,400
Giorgio Drago Marcolin S.p.A. 0 30,000 30,000
21

22
Consolidated Annual Report & Accounts
Signifi cant events occurring after year-end
and expected business progress
As already highlighted in the fi rst part of this report, we note that, as from October 1st 2005 and until December 31st
2005, although Marcolin will retain ownership of its contract with Dolce & Gabbana with effect until December 31st
2005, the Luxottica Group will take over sale of a signifi cant portion of products, currently made and distributed by
Marcolin. This consequently means that Marcolin will make and present its last collections for the Dolce & Gabbana
lines during the forthcoming MIDO exhibition in Milan in May 2005. It will be able to sell these until September
30th 2005. After this date the Luxottica Group will take over sale of the aforementioned collections, enabling
Marcolin to obtain the benefi t (calculated as being some € 1.8 mn) of not paying part of minimum guaranteed
royalties for the last quarter to Dolce & Gabbana, plus the possibility of supplying Luxottica (in particular, as
regards prescription eyewear) with some products forming part of the last collections created by Marcolin.
We repeat that this transitional agreement was desirable so as to avoid incurring signifi cant costs relating to the
presentation of new collections close to license expiry, sales of which would in any case be terminated by the end
of the year.
The parent company’s management, having offi cially acknowledged non-renewal of the Dolce & Gabbana
contract upon expiry - and in order to address the possible decrease in sales and margins and besides having
taken immediate action to seek new licenses - also devised a plan, recently approved by Marcolin S.p.A.’s Board
of Directors, designed to reduce costs. The plan envisages the possibility of making temporary use of the “Cassa
Integrazione Guadagni” - i.e. the Italian subsidised temporary lay-off system - at the factories and the logistics area
of Vallesella di Cadore and Longarone, for a maximum total of some 180 employees, as from forthcoming months.
Execution of the plan, as regards approach and timing, must be agreed upon with trade-union organisation.
The entity of use of the temporary lay-off system will also depend on the company’s future order infl ows
and on the possibility of making agreements to develop new licenses, so as to assure effi cient use of the factories
in question.
Besides what has already been stated at the beginning of this report on operating performance, as regards the early
months of the current FY we point out continuation of the across-the-board market diffi culties caused primarily
by the uncertain international situation, which dampens consumer-spending propensity.
As regards the French subsidiary Cébé, given the negative results achieved during 2004, the parent company’s
management started in-depth analysis and verifi cation, with the aim of taking incisive managerial action designed
to achieve recovery of the subsidiary’s profi tability. A plan is currently being devised to reorganise production
activities performed by the subsidiary.
Other information
Information on abnormal and unusual transactions and transactions with related parties
With reference to the recommendation made in CONSOB memorandum DAC/98015375 dated February 17th 1998,
below we provide the required information concerning abnormal and unusual transactions and transactions with
related parties.
Atypical and unusual operations
During 2004 Marcolin S.p.A. and subsidiary companies belonging to the Marcolin Group did not undertake any
transactions outside of the normal course of business or such as to signifi cantly infl uence the business, capital and
fi nancial status of Marcolin S.p.A. and of the group.
We note that in FY2004 Marcolin S.p.A. signed a consulting agreement with Mrs. Maria Giovanna Zandegiacomo,
who owns a major equity interest in Marcolin S.p.A., for fees of some € 54k in 2004 and € 85k for 2005. These
transactions were approved by the Board of Directors.
During 2004 group companies completed commercial and fi nancial intercompany transactions based on arm’s
length conditions.
Transition to IAS/IFRS
During 2004 work continued on development and completion of the project for transition to international
accounting principles (IAS/IFRS). The work currently underway aims to determine P&L and balance-sheet impact,
the results of which must be submitted to the independent auditor for review, with the objective of applying the
new standards within the terms envisaged by regulations.

Marcolin Group
More specifi cally, the parent company completed the fi rst phase of analysis and preliminary study in order to
pinpoint the main differences between Italian accounting standards and IAS/IFRS and areas that will necessarily
change due to application of the new standards.
The activity continued determining the new standards applicable to the group and analysing their impact on
corporate administrative processes and businesses.
As a result of this activity, the areas where IAS application will lead to important changes have emerged as being
the following:
• Goodwill and consolidation difference: these items will no longer be systematically amortised in the profi t
& loss account but must be subjected to annual valuation in order to identify any impairment of value.
In the case of valuation of the trademarks and goodwill of Cébé S.A. and Marcolin U.S.A. Inc. specifi c
impairment tests have been performed.
• Tangible fi xed assets: IAS envisage two methods for quantifying these items in accounts, i.e. depreciated
cost and fair value. In addition, depreciation must refl ect assets’ effective useful working life.
Determination is currently underway of the useful working life of assets to be subjected to depreciation
and of their residual value, as well as the separation of land value from that of building.
This work should be completed shortly with determination of the fi gures concerned and choice of the
most suitable accounting policy for the company.
• Inventories: we already quantify inventories on the basis of weighted average cost as envisaged by IAS.
Consequently the new standards will have no impact on present inventory value.
• Employee severance indemnity reserve: according to IAS the reserve and provisioning for employee
severance indemnities comes under the defi nition of “post-retirement benefi ts” and liability therefore
has to undergo actuarial valuation.
Apart from employee severance indemnities, the group has no particular long-term benefi ts for employees.
Marcolin S.p.A. has made use of a consulting fi rm in order to recalculate the value of the employee
severance indemnity reserve and provisioning. This work will be completed shortly.
• Derivatives: under IAS/IFRS all derivatives must be refl ected in accounts at their relevant fair value.
Accounting treatment of derivatives varies depending on their characteristics (hedging of business
risk and speculative instruments). The company has already applied this policy in year-end fi nancial
statements for both 2003 and 2004.
The fi nal phase, currently underway, focuses on calculation of the economic and fi nancial impact to be applied to
the various accounting items with the objective of adopting IAS/IFRS within the terms envisaged by regulations.
Privacy Regulations - Italian Legislative Decree no. 196/2003
During 2004 we reviewed the issues of protection of individual and corporate personal data regulated by Italian
Legislative Decree no. 196 dated June 30th 2003. We are about to complete the Plan for Security Measures, with
the deadline for completion fi xed for December 31st 2005. By the end of 2005 defi nition will be completed of the
technical work required for application of mandatory minimum security measures as contemplated by the above
decree’s set of technical rules.
Other disclosures
We point out that the group parent company has not opted to sign on for international tax consolidation - pursuant
to Articles 130-142 of Italian Presidential Decree no. 917/1986, as amended by Legislative Decree no. 344/2003 (tax
reform) - given the absence of the implementation decrees for practical regulation of this matter.
We also point out that Marcolin S.p.A. has not opted to sign on for domestic tax consolidation - pursuant to
Articles 117-129 of Italian Presidential Decree no. 917/1986 - given the absence of major equity interests in
Italian companies.
The group parent company Marcolin S.p.A. is not subject to activities of direction and co-ordination by other
companies, as defi ned by Articles 2497 et seq. of the Italian Civil Code.
The Board thanks all staff for their work and the Board of Statutory Auditors and the independent auditor for
their supervisory and control activity and recommendations.
Giovanni Marcolin Coffen
Chairman of the Board of Directors
Longarone, March 18th 2005
23

24
Consolidated Annual Report & Accounts
CONSOLIDATED BALANCE SHEET AT DECEMBER 31ST 2004
ASSETS 31.12.2004 31.12.2003
A) Share capital issued and not yet paid
B) Fixed assets
0 0
I Intangible fi xed assets
1 Installation and expansion cost 0 190
2 Research, development and advertising cost 92,004 38,126
3 Industrial and other patent rights 66,066 154,625
4 Concessions, licenses, trademarks and similar rights 3,606,582 4,131,955
5 Goodwill 0 0
6 Assets under construction and advances 2,008,938 609,718
7 Other 1,083,017 1,183,670
8 Difference of currency conversion 6,185,525 7,138,390
Total intangible assets 13,042,133 13,256,674
II Tangible fi xed assets
1 Land and buildings 6,441,638 6,715,811
2 Plant and machinery 1,514,733 2,062,122
3 Industrial and commercial equipment 2,113,272 1,985,178
4 Other goods 2,533,552 3,340,297
5 Construction in progress and advances 36,218 108,033
Total tangible assets 12,639,413 14,211,440
III Financial assets
1 Investments
a) subsidiaries 0 0
b) associated companies 559,775 536,343
c) parent companies 0 0
d) other companies 0 0
Total investments
2 Receivables
559,775 536,343
a) from subsidiaries - within 12 months 0 0
- after 12 months 0 0
b) from associated companies - within 12 months 0 0
- after 12 months 0 0
c) from parent companies - within 12 months 0 0
- after 12 months 0 0
d) other - within 12 months 0 0
- after 12 months 1,045,534 1,344,076
Total receivables 1,045,534 1,344,076
3 Other securities 129,690 234,768
4 Own shares 0 0
Total fi nancial assets 1,734,999 2,115,187
Total fi xed assets
C) Current assets
27,416,545 29,583,302
I Inventory
1 Raw materials, auxiliary materials and spare parts 8,961,971 9,858,148
2 Work in progress 6,010,149 5,921,287
3 Contract work in progress 0 0
4 Finished goods 32,554,367 36,813,674
5 Advances 0 0
Total inventory 47,526,487 52,593,108
II Receivables
1 Trade receivables - within 12 months 62,098,318 53,146,219
- after 12 months 0 0
2 Receivables from subsidiaries - within 12 months 0 0
- after 12 months 0 0

Marcolin Group
3 Receivables from associated companies - within 12 months 0 0
- after 12 months 0 0
4 Receivables from parent companies - within 12 months 0 0
- after 12 months 0 0
4-bis Receivables from tax authorities - within 12 months 1,278,612 45,133
- after 12 months 0 0
4-ter Accrued taxes - within 12 months 2,461,682 2,277,356
- after 12 months 2,314,981 3,309,820
5 Other receivables - within 12 months 574,498 2,320,257
- after 12 months 648 63,625
Total receivables 68,728,739 61,162,411
III Short term investments
1 Investments In subsidiaries 0 0
2 Investments In associated companies 0 0
3 Investments In parent companies 0 0
4 Other Investments
5 Own shares
0 0
(for a nominal value at. 31.12.2004 of Euro 354,120.08) 946,589 759,996
6 Other securities 0 0
Total short term investments
IV Cash and banks
946,589 759,996
1 Bank and postal deposits 9,145,289 14,370,454
2 Checks 117,142 46,401
3 Cash on hand 17,628 21,846
Total cash and banks 9,280,060 14,438,701
TOTAL CURRENT ASSETS 126,481,875 128,954,217
D) Prepayments and accrued income 2,258,534 2,419,421
TOTAL ASSETS 156,156,954 160,956,939
LIABILITIES AND SHAREHOLDER’S EQUITY
A) Shareholders’ equity
31.12.2004 31.12.2003
I Share capital 23,596,560 23,596,560
II Share premium reserve 21,950,034 21,950,034
III Revaluation reserve 0 0
IV Legal reserve 1,620,170 1,620,170
V Reserve for treasury stock 0 0
VI Statutory reserves 946,589 759,996
VII Other reserves
Currency conversion reserve -9,441,972 -8,525,434
VIII Profi ts (losses) carried forward 13,754,057 18,092,797
IX Profi t (loss) for the year 1,158,826 -4,151,662
Total shareholders’ equity of the Group 53,584,265 53,342,461
X Third parties equity and reserves 0 0
XI Profi ts (losses) of competence of third parties 0 0
Net Equity of competence of third parties 0 0
TOTAL SHAREHOLDERS’ EQUITY
B) Provisions for contingencies and commitments
53,584,265 53,342,461
1 Provision for severance indemnities and similar commitments 746,219 866,403
2 Provision for deferred taxes 221,954 193,692
3 Other provisions 1,397,993 1,208,842
Total provisions for contingencies and commitments 2,366,166 2,268,938
C) Staff leaving indemnity 4,905,774 4,373,910
25

26
Consolidated Annual Report & Accounts
D) Payables
1 Bonds and debentures - within 12 months 0 0
- after 12 months 0 0
2 Convertible bonds - within 12 months 0 0
- after 12 months 0 0
3 Payable to Shareholders for fi nancing - within 12 months 0 0
- after 12 months 0 0
4 Banks loans and overdrafts - within 12 months 23,656,400 29,156,378
- after 12 months 29,972,954 28,877,353
5 Other fi nancing payables - within 12 months 148,037 719,308
- after 12 months 975,325 353,796
6 Advances - within 12 months 0 0
- after 12 months 0 0
7 Trade payables - within 12 months 28,474,726 32,428,196
- after 12 months 0 0
8 Notes payables - within 12 months 0 0
- after 12 months 53,716 161,156
9 Payables to subsidiaries - within 12 months 0 0
- after 12 months 0 0
10 Payables to associated companies - within 12 months 1,117,161 1,116,980
- after 12 months 0 0
11 Payables to parent companies - within 12 months 0 0
- after 12 months 0 0
12 Taxes payable - within 12 months 4,216,635 1,674,565
- after 12 months 0 0
13 Social security payables - within 12 months 1,726,745 1,641,396
- after 12 months 0 0
14 Other payables - within 12 months 3,260,889 3,573,057
- after 12 months 87,565 39,738
Total payable 93,690,155 99,741,921
E) Accrued liabilities and deferred charges 1,610,594 1,229,708
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY 156,156,954 160,956,939
MEMORANDUM ACCOUNTS
Risks assumed
31.12.2004 31.12.2003
a) Guarantees lent to third parties 2,032,914 1,633,530
b) Guarantees lent to subsidiaries 2,976,000 3,731,754
c) Other guarantees lent to subsidiaries 2,301,639 4,057,986
Goods on third parties hands 0 0
Group committments 333,084 3,114,828
Total memorandum accounts 7,643,637 12,538,098

CONSOLIDATED INCOME STATEMENT FOR THE YEAR 2004
Marcolin Group
31.12.2004 31.12.2003
A) Value of production
1 Revenues from sales and services 173,202,328 157,293,624
2 Changes in work in progress and fi nisched goods -3,402,289 6,551,913
3 Variations in contracted work in progress 0 0
4 Increase in internal construction capitalized
5 Other income
748,026 407,082
a) grants and subsidies 0 0
b) other 1,868,689 2,149,480
Total other income 1,868,689 2,149,480
Total value of production
B) Cost of production
172,416,754 166,402,100
6 Cost of raw materials, auxiliary materials, spare parts and goods 48,101,412 52,218,706
7 Costs for services 48,504,317 49,295,372
8 Cost for utilization of third parties’ assets (leasing)
9 Personnel costs
16,218,869 13,884,678
a) salaries and wages 31,438,568 32,612,732
b) social contributions 7,738,177 7,815,266
c) staff leaving indemnity 887,959 918,475
d) other social contributions 163,434 167,643
e) other costs 156,945 179,115
Total personnel costs
10 Depreciation and write-down
40,385,083 41,693,231
a) amortization of intangible assets 1,872,091 3,065,334
b) depreciation of tangible fi xed assets 3,700,936 3,767,675
c) other writes-down of assets 0 43,133
d) write-down of receivables recorded among current assets 1,527,550 1,842,960
Total depreciation and write-down 7,100,577 8,719,102
11 Change in inventory of raw materials, auxiliary materials, spare parts and goods 880,523 -2,022,990
12 Accruals for contingencies 866,038 280,228
13 Other accruals 0 0
14 Other operating charges 1,133,247 1,287,336
Total cost of production 163,190,066 165,355,663
Difference between value and cost of production (A-B)
C) Financial income and charges
15 Income from investments
9,226,688 1,046,436
a) dividends from subsidiaries 0 0
b) dividends from associated companies 0 0
c) dividends from other investments 0 0
d) other income from investments 0 0
Total Income from Investments
16 Other fi nancial income
a) from receivables recorded as fi xed assets:
0 0
- subsidiaries 0 0
- associated companies 0 0
- parent companies 0 0
- other 145,487 258,012
Subtotal 16 a) 145,487 258,012
27

28
Consolidated Annual Report & Accounts
b) from securities recorded as fi xed assets 0 0
c) from securities recorded as current assets
d) other fi nancial income
864 2,780
- from subsidiaries 0 0
- from associated companies 0 0
- from parent companies 0 0
- Other 604,091 879,945
Subtotal 16 d) 604,091 879,945
Total other fi nancial income
17 Interest and other fi nancial charges
750,442 1,140,737
a) from subsidiaries 0 0
b) from associated companies 0 0
c) from parent companies 0 0
e) interest payable 2,708,392 2,484,049
f) other 1,325,136 1,471,531
Total interest and other fi nancial charges
17-bis Gains and Losses on Exchange rate
4,033,527 3,955,579
a) gains 1,801,293 1,651,212
b) losses -1,800,320 -3,597,307
Total Gains and Losses on Exchange rate 972 -1,946,095
Total (15+16-17+-17 bis) -3,282,113 -4,760,938

CONSOLIDATED INCOME STATEMENT FOR THE YEAR 2004
Marcolin Group
31.12.2004 31.12.2003
D) Adjustments to the value of fi nancial operations
18 Revaluation
a) investments in share capital 23,432 10,778
b) other investments 0 0
c) securities recorded as current assets 187,650 0
Total Revaluation
19 Write down of
211,081 10,778
a) investments in share capital 0 40
b) other than equity investments 0 0
c) securities recorded as current assets 0 17,025
Total Write down 0 17,065
Total Adjustments (18-19)
E) Extraordinary income and expenses
20 Income
211,081 -6,287
a) capital gains on disposal of assets 42,663 7,260
b) other extraordinary income 491,445 827,812
Total extraordinary income
21 Expenses
534,108 835,073
a) losses on disposal of assets 40,086 62,864
b) taxes relating to previous periods 98,729 539,384
c) other extraordinary charges 526,927 372,925
Total extraordinary expenses 665,742 975,173
Total extraordinary items (20-21) -131,634 -140,100
Profi t (loss) before taxes (A-B±C±D±E)
22 Income taxes for the period
6,024,022 -3,860,889
a) Current Taxes 4,346,479 2,634,633
b) Deferred Taxes 272,850 508,217
c) Accrued Taxes 245,867 -2,852,076
Total Income taxes for the period 4,865,196 290,773
23 Profi t (loss) for the PERIOD 1,158,826 -4,151,662
29

30
Consolidated Annual Report & Accounts
EXPLANATORY NOTES TO CONSOLIDATED ACCOUNTS
FOR THE YEAR ENDING ON DECEMBER 31 31ST ST 2004

1 INTRODUCTION
Marcolin Group
1.1 General information
The consolidated annual report and accounts for the year ending on December 31st 2004, prepared in compliance
with Italian Legislative Decree 127/1991, refl ect 100% line-by-line consolidation of the year-end fi nancial statements
of Marcolin S.p.A. and its subsidiaries.
We point out that the report on operating performance provides information concerning the nature of our business,
signifi cant events occurring after year-end, and transactions with subsidiary/associated/parent companies, together
with information concerning the various geographical areas and business sectors.
1.2 Group business
The group parent company Marcolin S.p.A. is active in the production and marketing of prescription fashion
eyewear and sunglasses. The companies pertaining to the subholding company Cébé are active in the production
and marketing of ski goggles and sports eyewear and accessories. The other investee companies market, in their
respective countries, products of both the parent company and the Cébé Group.
1.3 Legal regulations and accounting standards
We have prepared consolidated fi nancial statements as at December 31st 2004 in compliance with Italian Legislative
Decree no. 127/1991 - which incorporated the EEC Seventh Directive concerning consolidated year-end fi nancial
statements in Italian law - and with the Italian Civil Code’s rules concerning statutory year-end fi nancial statements,
as amended by Italian Legislative Decree no. 6 of January 17th 2003 and subsequent amendments concerning
“Systematic reform of rules for corporations”, when applicable by virtue of analogy with or specifi c reference to
consolidated accounts.
In drawing up consolidated fi nancial statements for the year ending on December 31st 2004, for those aspects not
specifi cally contemplated by regulations we have made reference to accounting standards issued by the Italian
National Council of Chartered & Registered Accountants and, in absence of the same, to those of the International
Accounting Standards Board (IASB).
In order to facilitate comparison with the previous FY, fi gures for the year ending on December 31st 2003 have also
been classifi ed according to the new rules. The latter envisage, among other things, partly different classifi cation of
some balance-sheet and P&L items.
The purpose of Explanatory Notes is to illustrate, analyse and, in some cases, interpret data in year-end fi nancial
statements. They contain the information required by Article 38 and other provisions of Italian Legislative Decree
127/1991. We have provided other, complementary items of information deemed necessary for truthful and proper
representation, even if not specifi cally required by law.
In cases where legal regulations require specifi c information on items and events that are not present or that
are non-existent, instead of indicating their non-applicability to the present annual report & accounts we have
preferred not to mention them at all, so as not to further burden exposition in these Explanatory Notes.
2 GENERAL POLICIES FOR PREPARATION OF CONSOLIDATED ACCOUNTS
AND CONSOLIDATION AREA
2.1 Consolidation area
The Marcolin Group’s consolidated year-end accounts as at December 31st 2004 refl ect consolidation as at that
date of Marcolin S.p.A. (the group parent company) and of the Italian and non-Italian companies directly and
indirectly controlled by the same.
The fi nancial statements used for consolidation are those prepared by the individual companies’ directors and
approved by the respective shareholder meetings or boards of directors according to regulations applicable in the
various countries, adjusted and restated, when necessary to align them with the accounting policies envisaged by
Italian Legislative Decree 127/1991 and with Italian and international accounting standards. Generally speaking,
the main adjustments basically concern accounting for leasing transactions using the fi nancial method and
valuation at equity of equity interests not included in the consolidation area.
31

32
Consolidated Annual Report & Accounts
Below we list equity investments consolidated on a 100% line-by-line basis and, for the sake of completeness of
information, those accounted for at equity.
List of companies consolidated on 100% line-by-line basis
Company Headquarters Currency Capital Stock % ownership
Direct Indirect
Marcolin & Co. S.p.A. Longarone EUR 593,130.00 99,96 -
Marcolin France S.a.r.l. Morez EUR 577,744.58 99.99 -
Marcolin (Deutschland) GmbH Ludwigsburg EUR 300,000.00 100.00 -
Marcolin (U.K.) Ltd. Newbury GBP 850,000.00 99.88 -
Marcolin Iberica S.A. Barcelona EUR 487,480.92 100.00 -
Marcolin GmbH Fullinsdorf (CH) CHF 200,000.00 100.00 -
Marcolin Portugal Lda. S. Joao do Estoril EUR 420,000.00 99.82 -
Marcolin Benelux S.p.r.l. Faimes EUR 240,000.00 99.98 -
Marcolin U.S.A. Inc. New York USD 536,500.00 85.40 14.60
Marcolin Intern. B.V. Amsterdam EUR 18,151.21 100.00 -
Marcolin Asia Ltd. Hong Kong USD 198,863.00 - 100.00
Marcolin do Brasil Ltda. Jundiai BRL 2,509,030.00 99.90 0.10
Cébé S.A. Morez EUR 3,004,918.00 - 100.00
Cébé Sport S.A. Nyon CHF 300,000.00 - 99.00
Cébé Scandinavia A.B. Avesta SEK 100,000.00 - 100.00
Cébé Japan Ltd. Tokyo JPY 3,000,000.00 - 100.00
The fi nancial year-end date of the controlled (subsidiary) companies listed above is the same as that of the group
parent company. This is also true of the associated company indicated below.
There have been no changes in the consolidation area compared with the previous FY.
List of companies booked at equity
Finitec S.r.l., a company in which we own a 40% equity interest, performs galvanic fi nishing and lacquering of
eyewear mainly for Marcolin S.p.A.
Company Headquarters Currency Capital Stock % ownership
Direct Indirect
Finitec S.r.l. Longarone EUR 54,080.00 40.00 -
2.2 Consolidation and conversion policies
The accounting policies and standards used to draw up consolidated year-end fi nancial statements are in line with
those used for the parent company’s statutory year-end fi nancial statements. No signifi cant change has occurred
compared with standards applied in the previous FY.
The consolidation method followed is as follows:
a) Incorporation of accounts of companies consolidated on a 100% line-by-line basis, i.e. aggregating
the entire amount of individual companies’ P&L and balance sheet items, regardless of percent equity
interests owned.

16
Consolidated Annual Report & Accounts
FY2004 ended with EBITDA of € 17,193k (with a 9.9% margin on sales), up by € 7,147k (+71%) over the previous
year. We wish to underline that this clear improvement was largely ascribable to the U.S. subsidiary, which reported
EBITDA substantially at breakeven at 2004 year-end as opposed to a negative fi gure of some € -6,110k as at
December 31st 2003 (as indicated in the table below which shows the breakdown of the main operating indicators
between the American market and the rest of the world).
U.S.A. Rest of the world
(Euro/thousand) 31.12.2004 % 31.12.2003 % 31.12.2004 % 31.12.2003 %
REVENUES 37,882 100.0 36,085 100.0 135,321 100.0 121,208 100.0
EBITDA 21 0.1 -6,110 16.9 17,172 12.7 16,155 13.3
EBIT -1,603 4.2 -8,474 23.5 10,830 8.0 9,520 7.9
PRE TAX -2,106 5.6 -9,138 25.3 8,130 6.0 5,277 4.4
Operating Result -2,106 5.6 -9,138 25.3 3,265 2.4 4,986 4.1
The substantial improvement of results achieved by Marcolin U.S.A. was driven both by the changed economic
conditions of the U.S. market and by the positive effects of the restructuring plan implemented during the previous
FY. This plan involved implementation of a number of incisive actions designed to recover margin - mainly via
reduction of overhead costs, focus on high-margin lines, and the introduction of new lines such as Kenneth Cole
and Timberland.
As regards the trend of EBITDA achieved in the rest of the world, we note substantial maintenance of margin,
albeit in the presence of diffi culties encountered in European markets and of the less than positive results of Cébé,
as better specifi ed later on in the report.
EBIT also showed signifi cant improvement, increasing from € 1,046k as at December 31st 2003 to some € 9,227k
at 2004 year-end, with a 5.3% margin on sales (vs. 0.7% as at 31/12/2003).
As already highlighted when commenting on EBITDA, the YoY change was essentially ascribable to the
improvement in operating fi gures achieved by our U.S. affi liate, where EBITDA went from a negative fi gure of
€ -8,474k as at December 31st 2003 to a negative fi gure of € -1,603k at 2004 year-end.
By way of further support of the above comments, below we show the main operating fi gures of Marcolin U.S.A. Inc.
(in U.S. Dollars):
VALUES IN USD
(U.S. Dollars/thousand) 31.12.2004 % 31.12.2003 % delta
REVENUES 47,121 100 40,820 100 15.44
EBITDA 27 0.1 -6,911 16.9 100.39
EBIT -1,994 4.2 -9,585 23.5 79.19
PRE TAX -2,619 5.6 -10,337 25.3 74.66
Operating Result -2,619 5.6 -10,337 25.3 74.66

Marcolin Group
b) The book value of consolidated equity interests owned by the parent company and other consolidated
companies is eliminated against investee companies’ related net equity (i.e. shareholders’ equity).
Any difference emerging is treated as follows:
• Difference upon fi rst-time consolidation:
If it is the fi rst time that the company has been included in consolidation, the difference is allocated,
as far as possible, to asset and liability items. Any remainder, if positive, is posted under another
asset heading called “Consolidation difference”. If the remainder is negative it is posted under a net
equity heading called “Consolidation reserve” or - when this is due to an expectation of adverse profi t
performance - under a heading called “Consolidation reserve for future risks and charges”.
• Difference stemming from changes in investee companies’ net equity occurring after fi rst-time
consolidation other than those caused by the year’s bottom-line result:
Negative or positive differences are respectively debited or credited to the net equity heading called
“Retained earnings/(losses carried forward)”.
c) Any portions of net equity and net results pertaining to minority interests are shown in a specifi c item
of consolidated net equity called “Share capital & reserves pertaining to minority interests” and of the
consolidated income statement called “Net profi t/(loss) pertaining to minority interests”.
d) Profi ts or losses not yet realised stemming from group intercompany transactions are eliminated,
as are payables and receivables and all transactions that have taken place between companies included
in consolidation.
e) Dividends distributed by companies consolidated on a 100% line-by-line basis are eliminated from
the profi t & loss account, which instead incorporates the results achieved in the FY.
2.3 Departures from rules
We specify that no exceptional cases making it necessary to depart from rules under Article 29, paragraphs 4
and 5, of Italian Legislative Decree 127/1991 occurred.
2.4 Translation of foreign-currency fi nancial statements
Foreign companies’ fi nancial statements are converted into euro according to the following established international
practice, applying fi xed conversion rates as required by Italian Legislative Decree no. 213 of 24/06/1998:
• Assets and liabilities are converted at the current exchange rates in force on the year-end date
• Revenues and costs, plus income and charges, are converted at the average exchange rate for the year
• Individual net equity items are expressed at their historical exchange rates when formed.
Foreign-exchange differences stemming from conversion of fi nal net equity at historical exchange rates as opposed
to that in force on the year-end date are allocated directly to net equity, together with differences between the net
bottom-line result expressed at average exchange-rates and that expressed in euro at exchange rates in force at
year-end, in the item “Reserve for translation differences” , included under the heading “Other reserves”.
The following tables shows the exchange rates applied for conversion:
Currency Symbol Final Exchange Average Exchange
Current Year Prior Year Difference Current Year Prior Year Difference
British Pound GBP 0,7051 0,7048 0.04% 0,6787 0,6920 -1.93%
Swiss Franc CHF 1,5429 1,5579 -0.96% 1,5438 1,5212 1.49%
U.S. Dollar USD 1,3621 1,2630 7.85% 1,2439 1,1312 9.97%
Brasilian Real BRL 3,6728 3,6627 0.28% 3,6341 3,4680 4.79%
Hong Kong Dollar HKD 10,5881 9,8049 7.99% 9,6881 8,8079 9.99%
33

34
Consolidated Annual Report & Accounts
3 ACCOUNTING POLICIES
3.1 Group accounting policies
The accounting policies used to draw up group consolidated fi nancial statements for the year ending on
December 31st 2004 are the same as those used for the previous FY.
Items in fi nancial statements have been accounted for based on general criteria of prudence and temporal
applicability (accrual accounting) with a view to continuation of business by all companies included in the
consolidation area.
Continuity in the application of accounting policies over time is necessary to assure comparability of the
company’s accounts in the various years.
3.2 Other information
Valuation of Marcolin U.S.A. Inc.’s inventories is done using the FIFO method, whereas at group level valuation
is based on the weighted average annual cost. We have decided not to change the method used for valuation of
the U.S. subsidiary’s inventories to align it with that of the parent company, since application of the two different
methods does not lead to signifi cant differences.
For further information not contained in these Explanatory Notes, reference should be made to the Report on
Operating Performance.
3.3 Assets and liabilities
a) Intangible fi xed assets
Intangible fi xed assets are posted in accounts at the price paid for acquisition, inclusive of accessory costs and
amortised on a direct straight-line basis according to their residual possibility of utilisation.
Start-up and expansion costs, and R&D and advertising costs featuring multiannual usefulness posted in assets are
amortised in fi ve years - a period considered to be representative of their useful business life.
License and trademark costs are posted at purchase cost, together with accessory costs, and are amortised according
to residual possibility of utilisation.
The “Cébé” trademark was posted on the basis of an appraisal performed at the time of acquisition by a specialised
fi rm, Societex S.A. The trademark is being amortised in 20 years.
Proprietary trademarks and third-party licenses held by Marcolin U.S.A. Inc. were posted on the basis of a specifi c
valuation performed by Standard & Poor’s at the time of acquisition of Creative Optics Inc. (later merged by
incorporation in Marcolin U.S.A. Inc.) and are being respectively amortised in 15 and 3 years.
If, regardless of amortisation already posted, impairment emerges (i.e. permanent loss of value), the net fi xed asset
is written down accordingly. If in future years the reasons for impairment cease to exist, the asset is written back
to its original value.
The consolidation difference consisting of the goodwill arising from acquisition of the equity interest in the
Cébé Group is being amortised on a 10-year basis based on forecasts of the investee company’s future earnings
fl ows. The consolidation difference consisting of the goodwill generated by the acquisition of Creative Optics Inc.
is being amortised in 20 years based on the company’s expected earnings.
b) Tangible fi xed assets and depreciation
Tangible fi xed assets are shown net of their respective accrued depreciation and are posted according to the costs
effectively borne for their purchase or construction. The exceptions are those assets that have been revalued
according to provisions made by law.
Cost includes accessory costs and costs directly attributable to the asset concerned.
The costs of enhancement, upgrading and conversion that translate into an increase in tangible fi xed assets’
production capacity, safety, or useful operational life, are posted as an increase of the book value of the assets to
which they refer.
Routine maintenance and repair costs are fully expensed in the profi t & Loss account. Maintenance costs increasing
asset value are attributed to the assets to which they refer and undergo depreciation according to the latter’s
residual possibility of utilisation.

Marcolin Group
Tangible fi xed assets are systematically depreciated each year on a straight-line basis according to assets’ residual
possibility of business and operational utilisation. Depreciation rates applied are in any case in line with what has
been established also by Italian tax regulations.
If, regardless of depreciation already posted, impairment emerges, the net fi xed asset is written down accordingly.
If in future years the reasons for impairment cease to exist, the asset is written back to its original value.
The main depreciation rates applied by consolidated companies are as follows:
Category Rate
Buildings 3.0%
Non-operating machines 10.0%
Depreciable equipments 40.0%
Operating machines 15.5%
Furniture & fi ttings 12.0%
Booths furniture 27.0%
Electronic machines 20.0%
Vehicles 25.0%
Trucks 20.0%
Assets acquired via fi nancial leasing contracts have been posted in consolidated year-end fi nancial statements
according to international accounting standards (i.e. IAS 17). These envisage posting of the present value of leasing
instalments among fi xed assets, net of depreciation, and - among liabilities - of the debt for residual principal.
Interest expenses and depreciation relating to the year are posted in the profi t & loss account. Depreciation
of such assets is calculated according to useful business life in the same way as for tangible fi xed assets in the
same category.
Assets under construction and advance payments to suppliers are posted among assets according to the cost
borne, including directly attributable expenses.
c) Fixed fi nancial assets
Equity investments in associated companies in which the group owns a percentage of more than 20% but less
than 50% and where there is no assumption of de-facto control, are accounted for using the net equity method,
eliminating, when signifi cant, the group’s portion of intercompany profi ts not yet realised in the market.
We performed calculation using the net equity method based on the last year-end fi nancial statements approved,
adjusted - where necessary and if of signifi cant entity - to reverse tax-driven items and to adapt statements to the
accounting standards applied by group companies.
Non-current receivables included among Fixed Financial Assets are quantifi ed according to their presumable
realisation value.
Securities are posted at purchase cost. If value as indicated by market trends is lower than entry value, this is
aligned by writing it down to net trading value.
d) Inventory
Inventories are quantifi ed at the lowest between average purchase or production cost and corresponding
presumable disposal value, based on market trends.
“Presumable disposal value” means market value existing on year-end date. It is calculated taking into account any
fabrication costs still to be borne and direct selling costs. More specifi cally, in addition we consider price trends
and all other conditions having an infl uence also in the interval between year-end date and the date of preparation
of year-end accounts.
35

36
Consolidated Annual Report & Accounts
Purchase cost has been used for products purchased for subsequent resale and for directly or indirectly used
materials purchased and utilised in the production cycle, whereas, for fi nished products or work in process,
production cost has been used.
In determining purchase cost, we have taken into account the price effectively borne, inclusive of directly
attributable expenses, including freight costs and customs costs, net of trade discounts.
In production cost, besides the cost of materials used, as defi ned above, we have also considered direct and
indirect manufacturing costs.
Obsolete or slow-moving inventory items have been written down according to their possibility of utilisation
or disposal.
e) Receivables
Receivables are posted in accounts at presumable realisation value produced by the difference between face value
and a specifi c, prudently calculated Doubtful Debt Reserve.
f) Current fi nancial assets
Current fi nancial assets are quantifi ed at the lowest between purchase cost and presumable realisation cost based
on market trends. If in subsequent FYs the reasons for any write-downs cease to exist, book value is aligned with
market value up to the level of the original cost.
g) Cash & banks
Cash & banks as at year-end are shown at their face value.
h) Accruals and deferrals
Accrued income, prepayments, and accrued liabilities and deferred income are calculated according to temporal
applicability (accrual accounting).
i) Accruals for risks and contingencies
Accruals for risks and contingencies are made to cover losses or debts, of a known type and materialisation of
which is certain or likely - but whose entity and date of occurrence cannot be accurately determined at year-end.
Provisioning refl ects the best possible estimate based on information to hand.
The item also includes the value of deferred taxes calculated according to the approach described in the paragraph
called “Income tax in the year”.
Accruals also include provisions made against retirement benefi ts for European affi liates’ staff.
Valuation of accruals complies with the general criteria of prudence and applicability and no generic risk accruals
without any business justifi cation have been made.
j) Accruals for employee severance indemnities
For Italian companies, Accruals for employee severance indemnities, posted in accounts according to the provisions
of the sector’s national collective labour contract and in compliance with current regulations, represents the
group’s effective liability vis-à-vis individual employees as at year-end date, after deduction of any advances paid
our and tax payments on account required by law. This liability is subject to annual index-linked revaluation, as
per the provisions of the Italian Civil Code and relevant legislation.
For non-Italian companies retirement accruals are made in accordance with regulations in force in the individual
countries concerned. Retirement accruals for the French subsidiary Cébé S.A. are posted in consolidated year-end
fi nancial statements according to the actuarial/fi nancial method envisaged by IAS 19.
k) Payables
Payables are shown at their face value.
l) Income tax in the year
Taxes in the year are determined according to prudent application of current tax regulations. Debt for current
taxes is shown net of payments on account and of withholding tax paid under the heading “Tax payables”.

Marcolin Group
In addition, prepaid and deferred taxes are provisioned according to the dictates of Italian accounting principle
no. 25 (issued by the Italian National Council of Chartered & Registered Accountants) taking into account the
temporary differences (due to timing differences) between reported results and taxable income.
Prepaid taxes are posted based on the principle of prudence vis-à-vis expected taxable income.
Specifi cally, as regards provisioning of prepaid taxes against accrued tax losses, we point out that they are
posted only:
• If there is reasonable certainty of achieving, in future (normally within the next fi ve FYs) taxable income
of an entity able to absorb taxes losses that can be carried forward, and
• If accrued losses are due to specifi c circumstances that it is believed will not occur again in the future.
m) Foreign-currency transactions
Monetary assets and liabilities denominated in foreign currencies are posted at the spot exchange rate in force
on the date of the transaction originating them and adjusted to the spot exchange rate as at year-end date, taking
derivative hedging contracts into account. Unrealised positive or negative differences stemming from adjustment
of these items to the year-end spot exchange rate are posted in the profi t & loss account.
A new item has been included in the profi t & loss account - i.e. Foreign-exchange gains/(losses) - as per the
provisions of Article 2425, point 17/2 of the Italian Civil Code.
In order to permit proper comparison between fi gures for FY 2004 and those of the previous FY, FY2003 amounts
relating to positive and negative exchange-rate difference - respectively included in the items “Other fi nancial
income” and “Interest and other fi nancial expenses - have been reclassifi ed in the item “Foreign-exchange
gains/(losses)”.
3.4 Revenues
Revenues for the sale of products are recognised in accounts when ownership is transferred, i.e. normally upon
delivery or shipment of goods. In the case of services, revenues are recognised when provision of such services
has been completed.
Financial revenues are recognised according to temporal applicability.
3.5 Commitments, guarantees, and risks
Commitm ents and guarantees are shown in memorandum accounts at their contractual value.
Risks for which materialisation of a liability is certain or probable are provisioned in risk accruals based on
consistency criteria.
Risks for which materialisation of a liability is only possible are described in explanatory notes to accounts without
making any provision in relevant accruals.
3.6 Cash fl ow statement
The Cash Flow Statement shows cash fl ows by type, considering in the NFP (net fi nancial position) cash, bank
receivables and payables, other fi nancial debts, and readily monetisable securities.
3.7 Other information
There have been no departures from regulatory requirements under the fourth paragraph of Article 2423 of the
Italian Civil Code.
3.8 Comparability of items
In view of the modifi cations made to the structure and content of the balance sheet and profi t & loss account by
the rules contained in the reform of regulations for corporations introduced by Italian Legislative Decree no. 6 of
January 17th 2003 and subsequent amendments, we have adapted balance sheet and profi t & loss templates to the
requirements of the new provisions.
The amendments and additions made to year-end account templates are as follows:
• Introduction of the items C.II.4/2) and C.II.4/3) respectively for “Tax receivables” and “Prepaid taxes”;
• Inversion of numbering for the Statutory Reserve and Treasury Stock Reserve, respectively numbered
A.V and A.VI as from 2004;
• Introduction of the item D.3 - “Amounts payable to shareholders for loans”;
37

38
Consolidated Annual Report & Accounts
• Introduction of the item C.17/bis) - “Foreign-exchange gains/(losses)”;
• Addition to the item 22) - Income taxes in the year - of the specifi cation “current, deferred, and prepaid”.
For the purposes of uniformity, pursuant to Article 2423/ter of the Italian Civil Code, the corresponding items in
the previous year have also been reclassifi ed, as illustrated below (in Euro/thousand):
4 ILLUSTRATION OF MAIN ITEMS OF CONSOLIDATED FINANCIAL STATEMENTS
The fi gures shown in tables in these explanatory notes are in Euro/thousand, as envisaged in Italian accounting
standard 27 issued by the National Council of Chartered & Registered Accountants. Given this, the sums of the
various amounts, not showing decimal points, are rounded.
4.1 ASSETS
Old Scheme New Scheme
CII5) Other receivables 8,016 CII4-bis) Receivables from tax authorities 45
CII4-ter) Accrued Taxes 5,587
CII5) Other receivables 2,384
D4) Other fi nancing payables 1,073 D3) Payable to Shareholders for fi nancing 0
D5) Other fi nancing payables 1,073
C16d) Other fi nancial income 880 C16d) Other fi nancial income 880
C17-bis) Gains and Losses on exchange rate 0
C17) Interests and other fi nancial charges -7,553 C17) Interests and other fi nancial expenses -3,956
C17-bis) Gains and Losses on exchange rate -3,597
Intangible fi xed assets
Intangible fi xed assets as at December 31st 2004 showed a total balance of some € 13,042k. Individual items are
detailed in the table below:
INTANGIBLE ASSETS 31.12.2004 31.12.2003
(Euro/thousand)
Start-up and expansion costs 0 0
R&D, advertising costs 92 38
Industrial and other patent rights 66 155
Concessions, licenses, trademarks and similar rights 3,607 4,132
Goodwill 0 0
Assets under construction and advances 2,009 610
Other intangible assets 1,083 1,184
Consolidation differences 6,186 7,138
Total 13,042 13,257
Start-up and expansion costs
Start-up and expansion costs, which as at December 31st 2004 had been fully amortised, related to costs borne for
stock market listing of the group parent company.
Research & development and advertising costs
The amount shown for the present item refers to Cébé S.A. and consists of investments made to create the new
The North Face and Cébé collections.

Marcolin Group
Concessions, licenses, and trademarks
The amount shown for Concessions, licenses, and trademarks includes:
1) The value of the Cébé trademark that - following appraisal performed in February 2000 by the fi rm Societex S.A. -
was originally booked at a net value of some € 2,414k and amortised at the annual rate of 5%. Its net value as at FY2004
year-end amounted to about € 1,690k.
The Cébé trademark’s underwent appraisal by independent consultants at the beginning of 2005, which showed a
gross value of approximately € 2,500k.
2) The value of the proprietary trademarks and licenses held by ex-Creative Optics Inc. (now Marcolin U.S.A. Inc.),
originally amounting to USD 3,700k (= about € 2,716k at the 2004 year-end exchange rate) based on valuation
performed by Standard & Poor’s at the time of acquisition, are being amortised as indicated earlier in the description
of accounting policies. Net value as at FY2004 year-end amounted to some USD 1,540k (= about € 1,313k).
As in the case of the Cébé trademark, the net book value as at December 31st 2004 of Marcolin U.S.A. Inc.’s proprietary
trademarks and licenses underwent specifi c independent analysis, as better detailed later on.
Consolidation difference
This item includes goodwill stemming from acquisition of the Cébé Group, originally amounting to some € 2,005k,
the net value of which at year-end was about € 802k (based on an annual amortisation rate of 10%), as well as goodwill
stemming from acquisition of Creative Optics Inc., originally amounting to about USD 8,508k (= about € 6,246k at the
exchange rate in force on December 31st 2004), the net value of which at year-end was USD 6,806 (= about € 4,997k,
annual amortisation rate = 5%).
As highlighted in the report on operating performance, all intangible items (trademarks, licenses and goodwill)
relating to the American affi liate Marcolin U.S.A. Inc. and to Cébé underwent impairment testing of their value as
at December 31st 2004 by independent consultants in the early months of 2005, based on their respective business
plans. The results of these appraisals confi rmed the net book values posted in accounts.
Assets under construction
Intangible assets under construction include the investment made by the parent company for purchase of the
SAP ERP information system totalling some € 2,009k. This cost, which will be amortised as from 2005 upon full
on-stream operation of the system, includes the expense borne for acquisition of the software license and for
some consulting services strictly related to the system’s implementation, as well as capitalisation of the cost of staff
involved in the project.
For review of changes in intangible fi xed assets during the FY reference should be made to Attachment 1.
Tangible fi xed assets
Tangible fi xed assets as at December 31st 2004 are summarised below:
TANGIBLE ASSETS
(Euro/thousand)
31.12.2004 31.12.2003
Land and buildings 6,442 6,716
Plant and machinery 1,515 2,062
Industrial and commercial equipment 2,113 1,985
Other tangible assets 2,534 3,340
Construction in progress and advances 36 108
Total 12,639 14,211
Below we briefl y illustrate changes occurring in items included in tangible fi xed assets:
• Land & buildings: the decrease of some € 274k was mainly due to depreciation for the year and to
translation differences.
• Plant & machineries: the total balance decreased by some € 547k, with the change being basically due to
depreciation for the year and to translation differences. The main increases in the year relating to this
item referred to the group parent company Marcolin S.p.A. for the replacement of plant and machineries
(about € 147k).
39

40
Consolidated Annual Report & Accounts
• Industrial & commercial equipment: there was a net increase of some € 128k. The main increases related
to investments of about € 972k made by the parent company for the creation of new eyewear lines.
Decreases mainly related to depreciation for the year and to translation differences.
• Other tangible fi xed assets: the net reduction of € 807k was ascribable to depreciation for the year - mainly
relating to the U.S. and U.K. affi liates. Increases during the year mainly related to Marcolin S.p.A. and
basically concerned replacement of trade show stands (about € 227k).
Tangible fi xed assets were revalued in previous years in accordance with current regulations. We have
not undertaken any discretionary or voluntary revaluations, since the maximum limit of revaluations
undertaken is the objectively determined use value of the fi xed assets concerned.
Total tangible fi xed assets in the year refl ect the effect of accounting of amounts for assets acquired via fi nancial
leasing contracts according to international accounting standards (IAS 17), the detail of which is shown below in
terms of net amounts:
EFFECT OF IAS 17
(Euro/thousand)
2004 2003
Land and Buildings 938 971
Plant and machinery 29 92
Other 0 10
Fixed fi nancial assets
Equity investments
As at December 31st 2004 the following equity investments were not included in the consolidation area and were
booked at equity:
SHAREHOLDINGS IN ASSOCIATED COMPANIES 31.12.2004 31.12.2003
(Euro/thousand) % Value % Value
Finitec S.r.l. 40% 560 40% 536
Total 560 536
Receivables (non-current)
Amounts receivable from others decreased from about € 1,344k as at December 31st 2003 to about € 1,045k as at
December 31st 2004.
€ 999k of this item consists of a credit stemming from the transactions between Marcolin U.S.A. Inc. and the
U.S. company Active Media Service, to which slow-moving eyewear inventory had originally been sold for a price
at historic cost of some USD 2,3 mn. This credit is being discharged via compensation of debts in the form of
purchase of services, media products, and marketing services as envisaged in a specifi c contractual agreement that
expires at the end of 2008.
This credit was reduced by some € 200k during 2004 - both by using the credit with Active Media Service and by
provisioning write-down in compliance with American accounting principles.

FINANCIAL ASSETS - MATURITY ANALYSIS
(Euro/thousand) within one year after one year and
within 5 years
Marcolin Group
Other securities
This item includes cautionary deposits relating to the U.S. affi liate and Cébé, as well as bonds and equities received
by Marcolin U.S.A. Inc. to replace receivables previously written down.
CURRENT ASSETS
after 5 years 31.12.2004 31.12.2003
B.III Financial assets
Receivables:
a) due from subsidiaries
b) due from associated companies
c) due from parent companies
d) due from others 0 1,046 0 1,046 1,344
Total 0 1,046 0 1,046 1,344
Inventories
Inventories as at December 31st 2004 amounted to some € 45,526k vs. an amount of about € 52,593k as at December
31st 2003. The decrease was mainly ascribable to Marcolin U.S.A. Inc. and to the parent company and related to
more rational inventory management at group level.
We also note that, at 2004 year-end we aligned the value of slow-moving inventory with market value via an
inventory write-down accrual totalling some € 7,512k. Of this about € 3,267k related to Marcolin S.p.A. and about
2,082k to Marcolin U.S.A. Inc.
Receivables (current)
The item showed a balance of some € 63, 729k (vs. about € 61,162k as at December 31st 2003) and featured the
following breakdown:
RECEIVABLES - MATURITY ANALYSIS
(Euro/thousand) within one year after one year and
within 5 years
after 5 years 31.12.2004 31.12.2003
C.II Receivables:
Trade receivables 62,098 0 0 62,098 53,146
Due from subsidiaries 0 0 0 0 0
Due from associated companies 0 0 0 0 0
Due from parent companies 0 0 0 0 0
Due from tax authorities 1,279 0 0 1,279 45
Accrued taxes 2,462 2,315 0 4,777 5,587
Due from others 574 1 0 575 2,384
Total 66,413 2,316 0 68,729 61,162
Trade receivables
Trade receivables amounted to some € 62,098k with the balance showing an increase of some € 8,952k vs. the
balance as at December 31st 2003. It should be remembered that, at the end of the previous FY, receivables were
shown net of factoring transactions totalling some € 7,712k undertaken by the parent company. Consequently, we
highlight the fact that, gross of these transactions, trade receivables in FY2004 would have increased less than
proportionally in relation to the sales increase. This was substantially ascribable to tight credit management and
to better credit collection conditions.
41

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Consolidated Annual Report & Accounts
RECEIVABLES BY GEOGRAPHICAL AREA
Italy Rest of Europe North America Rest of the world Total
Current assets
- trade receivables 25,425 24,756 4,794 7,124 62,098
- other receivables 441 86 14 34 575
(Amounts in Euro/thousand)
Figures are shown net of accrued doubtful debt provision of some € 3,669k (vs. about € 3,314k at the end of the
previous FY). The increase was substantially due to high provisioning posted by Marcolin S.p.A. and Cébé in order
to align receivables’ value with their presumable realisation value.
The amount of doubtful debt provision accrued represents our best estimate of loss risks. Accrued provision
changed as shown in the following table:
RESERVE FOR DOUBTFUL ACCOUNTS
(Euro/thousand) 31.12.2004
Opening Balance 3,314
Provisions 1,528
Utilization -1,081
Other movements -91
Year-end Balance 3,670
Amounts receivable from others, tax receivables and prepaid-tax credits
Amounts receivable from other totalled some € 575k as compared with some € 2,384k at the end of the previous FY.
The item consisted of credits posted by the parent company for cautionary deposits and for payments on account.
Tax receivables amounted to some € 1,200k, mainly pertaining to the German affi liate and relating to VAT credit
for purchases made in the period.
Prepaid taxes refundable (relating to temporary deductible differences), which amounted to about € 4,777k,
pertained almost totally to Marcolin S.p.A. Changes occurring in this item are detailed in the explanatory note to
the parent company’s statutory year-end accounts.
Below we show the detail as at December 31st 2004, by individual company, of the group’s tax losses carried
forward, against which we have not posted deferred tax assets for prepaid taxes due to the absence of reasonable
certainty of their recoverability:
COMPANY
(Euro/thousand) Value Rate Deferred Taxes
Marcolin France S.a.r.l. 924 34% 317
Marcolin (Deutschland) GmbH 1,585 40% 634
Marcolin International B.V. 32 35% 11
Marcolin Benelux S.p.r.l. 136 34% 46
Marcolin & Co. S.p.A. 142 33% 47
Marcolin U.S.A. Inc. 17,871 39% 6,927
Total 20,690 7,982
The year in which the above tax losses expire is different for each of the companies indicated in the table. We have
instead booked deferred tax assets for prepaid taxes for the subsidiaries Cébé (about € 528k) and Marcolin GmbH
- Switzerland (about € 117k).

Current fi nancial assets
Marcolin Group
Treasury stock
As at December 31st 2004 the group parent company hold 681,000 of its own shares (treasury stock) - accounting
for approximately 1.50% of total share capital - for a nominal total amount of € 351,120. The amount shown in yearend
accounts includes write-back - within the limit of original cost - of some € 187k posted in the year in order to
align book value with the stock’s market price.
Other securities
As at December 31st 2004 the company did not hold any other securities in its portfolio.
Cash & banks
The balance represents liquid resources as at year-end date. The decrease of some € 5,159k over the previous year
was due to the fact that, at the end of 2003, the parent company had collected part of a loan, use of which took
place in the fi rst few days of FY2004.
Accrued income & prepayments
Below we detail the breakdown of this item:
ACCRUED INCOME AND PREPAYMENTS
(Euro/thousand) 31.12.2004 31.12.2003
Accrued income:
- Lease commitments 0 0
- Interest income 0 0
- Other 232 447
Total Accrued income 232 447
Prepayments:
- Rental expense 8 44
- Insurance premiums 140 120
- Discounts, premiums and other costs for granting loans and obtaining fi nancing 0 0
- Other 1,878 1,807
Total Prepayments 2,027 1,972
Total Accrued Income and Prepayments 2,259 2,419
€ 1,154k of the balance of the sub-item “Other prepayments” related to Marcolin U.S.A. Inc. and represented
the year’s portion of insurance premiums, royalties, and advertising expenses. The remainder of the amount
related to the parent company for the 2005 portion of the non-recurrent one-off amount paid in previous years to
Dolce & Gabbana S.p.A. for about € 206k, besides the consulting costs incurred at the end of the previous year
for acquisition of a new license, the residual value of which is about € 181k (the cost has been spread over the
contract’s duration).
We specify that no fi nancial charges were allocated to balance-sheet assets during the year.
43

44
Consolidated Annual Report & Accounts
4.2 LIABILITIES
Shareholders’ Equity
Changes occurring in Consolidated Shareholders’ Equity (net equity) during the year are detailed in Attachment 3.
As at December 31st 2004 the parent company’s share capital, fully subscribed and paid in, consisted of 45,378,000
ordinary shares of a nominal value of € 0.52 each.
Reference should be made to Attachment 4 for the reconciliation between parent company and consolidated net
equity and net result.
Accrued provisions for Risks & Contingencies and for Employee Severance Indemnities
The following table shows changes occurring in these items:
PROVISION FOR CONTINGENCIES AND COMMITMENTS AND STAFF LEAVING INDEMNITIES
(Euro/thousand) Opening
Balance
Retirement benefi ts and similar obligations
Accrued provisions for retirement benefi ts and similar obligations relates to provision for agent s’ indemnities.
They refl ect prudent assessment of the risk connected with possible termination by the company of the mandate
given to agents. The item refers to the parent company, for an amount of some € 732k.
Other provisions
The “Other provisions” item mainly consisted of estimated risk provision of some € 606k posted to take into
account marked-to-market valuation of some interest-rate hedging transactions (connected with loan operations)
executed by the parent company and still in place at year-end. It also included provision for litigation risks
of some € 192k and provisions totalling € 400k for the risk of customer returned goods, both relating to the
parent company.
Accrued provision for employee severance indemnities
The amount set aside represents the Group’s effective debt, as at December 31st 2004, to employees on the payroll
as at that date, net of advances paid out.
Average employee headcount during the year was as follows:
Provisions Utilization Other
movements
Translation
Differences
Year-end
Balance
Provision for severance indemnities
and similar commitments 866 175 -19 0 -276 746
Provision for taxes 194 180 -149 0 -2 222
Other provisions 1.209 530 -372 0 0 1.367
Provision for future contingencies and commitments 0 31 0 0 0 31
TOT Provision for Contingencies and Commitments 2.269 915 -540 0 -278 2.366
Total Staff Leaving Indemnities 4.374 922 -666 276 0 4.906
EMPLOYEES
Category Average 31.12.2004 Average 31.12.2003
Managers 25 25
First line managers 61 61
White Collars 457 478
Blue Collars 519 520
Total 1,062 1,084

Marcolin Group
Payables
The detail of and changes in the various items are shown in Attachment 5. Below we comment on breakdown and
the most signifi cant changes.
Bank loans and overdrafts
The balance of bank loans and overdrafts mainly consisted of the residual amounts payable for bank loans
taken out by Marcolin S.p.A. (about € 43,755k), by the Cébé Group (about € 9,123k), and by Marcolin U.S.A. Inc.
(about € 734k).
Going into greater detail, the structure of the group parent company’s medium-/long-term debt as at
December 31st 2004 was as follows:
BANK Currency Starting
Amount
Mediocredito
del FVG S.p.A.
Residual
Amount
USD 5,000,000 2,000,000 27-06-2006
Expiration Interest Rate Note
Libor
6 months
+0.8%
Efi banca S.p.A.* EUR 7,230,000 3,760,000 15-09-2006 5.05%
Interbanca S.p.A. EUR 7,000,000 3,500,000 5-01-2007
Euribor
6 months
+1.10%
Unicredit Banca S.p.A. EUR 8,000,000 3,590,000 31-01-2007 5.31%
Unicredit Banca S.p.A. EUR 2,000,000 1,050,000 31-03-2007
San Paolo IMI S.p.A.* EUR 7,000,000 5,440,000 29-05-2008
Ministero Attività
Produttive
Efi banca S.p.A.
Unicredit Banca S.p.A.*
Ministero delle attività
produttive (Innovazione
Tecnologica)
EUR
EUR
EUR
2,000,000
granted
1,939,081
(Credit
Line)
20,000,000
1,652,000
granted
793,000
Euribor
3 months
+0.8%
Euribor
6 months
+0.8%
1,550,000 17-12-2008 1.71%
17,000,000 11-12-2006
Euribor
3 months
+1.5%
793,000 1.012%
* These loans contractually establish covenants calculated on the main operating and fi nancial indicators of consolidated fi nancial statements.
10 deferred instalments (Capital
Share 500,000 USD), falling due
on January 10 and July 10.
Loan instalments and rate
subject to coverage operations
Refund with half-year
instalments, from March 15, 2003
fi nancing on BEI funds
10 half-year instalments
(capital share 700,000 euro)
from July 5,2002.
60 deferred monthly instalments
(capital share 152,108.7 euro).
10 deferred half-year instalments
(capital share 223,819.59 euro)
from September 30, 2002.
Expedited on May 29, 2003.
Refundable in 9 half-year
instalments
(capital share 777,778 euro)
from May 20, 2004.
Subsidized loan in accordance
with the Law no. 394 of
July 29, 1981, refundable in
10 half-year instalments from
06.17.2004 with a
pre-amortization instalments.
“stand by” Credit Line
“revolving” type,
dated December 11, 2003.
Pool-loan. Term out option which
allows the respite of refund
to December 11, 2008
Subsidized loan in accordance
with the Law no. 46, 1982,
refundable in 10 year
instalments.
45

46
Consolidated Annual Report & Accounts
We also point out - as regards a loan granted to the parent company with a residual amount on today’s date of some
€ 2.8 mn - that one of the parameters used as a covenant benchmark was exceeded. The bank concerned has, however,
already authorised this overshoot without this giving rise to any change in the economic conditions applied.
Amounts payable to other sources of fi nance
The item includes a debt of Marcolin S.p.A. for some € 793k concerning a loan issued by the Italian Industry
Ministry for research and technological innovation activity performed by the parent company. The item also
includes the fi gure relating to posting of fi nancial leasing contracts based on application of international accounting
standards (IAS 17).
Trade payables
The decrease of some € 3,953k in trade payables over the previous year was due to reduction of purchases made
by the parent company and by the U.S. affi liate.
PAYABLES BY GEOGRAPHICAL AREA
(Euro/thousand) Italy Rest of Europe North America Rest of the world Total
Payables
- Trade payables 19,282 4,436 -49 4,806 28,475
- Other payables 1,822 944 563 20 3,348
Notes payable
These mainly consisted of debts falling due after more than 12 months relating to Marcolin U.S.A. Inc. and mainly
concerning commercial transactions, for an amount of approximately € 54k.
Amounts payable to associated companies
The balance as at December 31st 2004 amounted to some € 1,117k and consisted solely of the parent company’s
debt to Finitec S.r.l., arising as a result of commercial transactions undertaken at going market rates.
Taxes payable
The balance amounted to about € 4,217k and mainly consisted of the debt for the year’s taxes, amounts payable to
the Inland Revenue for taxes withheld at source, and VAT. In contrast with 2003 the parent company reported a
net debt vis-à-vis the Inland Revenue included in the item (about € 2,604k).
Social security payables
The year-end balance amounted to some € 1,727k. The change over the previous year totalled some € 85k with the
largest increases relating to Cébé and to the parent company.
Other payables
Other debts mainly refer to (a) debt positions totalling existing vis-à-vis employees of Marcolin S.p.A. - for some
€ 1,806k - for wages & salaries, holidays not taken, and bonuses, (b) Marcolin U.S.A. Inc. (about € 563k), and (c)
Cébé (about € 599k).
Accrued liabilities and deferred income
Deferred income totalled some € 1,558k and related mainly to Marcolin S.p.A. - about €528k (for the portion accruing
in the year of interest payable to banks for loans granted and for hedging transactions) - and to Marcolin U.K.
(about € 336k).
Also posted among accrued liabilities, as applicable to the year, were positive and negative fl ows relating to the
interest-rate hedging contracts described later on.

The breakdown of accrued liabilities and deferred income by type is summarised below:
ACCRUED LIABILITIES AND DEFERRED CHARGES
4.3 MEMORANDUM ACCOUNTS
Marcolin Group
(Euro/thousand) 31.12.2004 31.12.2003
Accrued Liabilities:
- Rental expense 0 0
- Interest expenses 0 10
- Royalties 573 176
- Other 984 958
Total 1,558 1,144
Deferred Charges:
- Other 53 85
Total 53 85
TOTAL Accrued liabilities and deferred charges 1,611 1,230
Sureties given to subsidiaries amounting to some € 5,278k mainly referred to Cébé and Marcolin U.S.A. Inc.
Of sureties given to third parties some € 1,731k referred to the bank issuing a low-rate loan under Italian Law 394.
The company’s commitments concerned leasing companies (about € 333k).
Other information:
We specify that, as at December 31st 2004, the group parent company Marcolin S.p.A., besides the transactions
already shown in accounts via marked-to-market valuation, had the following transactions in place:
• A forex knock-out/knock-in (Ko Ki) forward contract for a total of USD 2 mn hedging the remaining
instalments of repayment of the loan granted by Mediocredito del Friuli Venezia Giulia S.p.A., which at
year-end amounted to some USD 2 mn.
• An IRS (interest-rate swap) contract, with the underlying liability consisting of the loan of € 7 mn
stipulated with San Paolo IMI S.p.A. in May 2003 for a nominal amount of € 7 mn for conversion of
the fl oating rate to a fi xed rate upon materialisation of given conditions, with pre-defi ned cap and fl oor
limits (as at year-end the market value was negative for Marcolin by some € 5k).
The contracts were stipulated in order to reduce the underlying loans’ costs and to protect the
company against any future increases in rates and should therefore be considered to be non-speculative
in nature.
47

48
Consolidated Annual Report & Accounts
4.4 INCOME STATEMENT
Value of production
Revenues from sales and services
Sales revenues as up to December 31st 2004 totalled some € 173,202k and featured the following breakdown by
category and geographical area:
SALES OF GOODS AND SERVICES
(Euro/thousand) 31.12.2004 31.12.2003
Category:
- Frames 160,751 145,730
- Ski goggles 8,401 7,456
- Accessories 4,051 4,107
Total for category 173,202 157,294
Geographical area:
- Italy 40,451 32,804
- Europe 78,644 73,485
- U.S.A. 35,074 34,380
- Rest of the world 19,033 16,625
Total for geographical area 173,202 157,294
Note: U.S.A. geographical area: the group’s sales solely in the U.S. market.
As illustrated in the report on operating performance, the increase was mainly ascribable to the good performance
of the parent company - about € 12,577k (+15%), of the Spanish affi liate - about € 2,076k (+18%), of the American
affi liate - about € 1,769k (+5%), and of the French affi liate - about € 1,419k, which was set against the decrease of
some €1,042k of Cébé S.A.
Other income
The amount of the item “Other income” decreased from some € 2,149k as at December 31st 2003 to about € 1,869k
as at December 31st 2004. The reduction was mainly due to lower reimbursement of freight expenses charged to
customers by Marcolin U.S.A. Inc.
OTHER INCOME
(Euro/thousand) 31.12.2004 31.12.2003
Reimbursements for transportation expenses 1.447 1.580
Reimbursement for other expenses 0 0
Government grants received 0 0
Other 421 569
Total other income 1.869 2.149
Cost of production
Materials costs
The cost borne for raw and ancillary materials decreased by some 8% vs. FY2003. We point out that, during 2004,
the parent company reclassifi ed some costs concerning the purchase of components - previously included among
costs for outsourced processing (Item B7 - service costs - in year-end fi nancial statements) - in order to represent
the costs borne for this cost item better. Applying the same accounting policy as that adopted during 2004, costs of
raw and ancillary materials and of fi nished products as at December 31st 2003 would have totalled some € 55,656k
and therefore, as at December 31st 2004, would have decreased by some € 7,555k.

Marcolin Group
This reduction stemmed from more rational inventory management, especially by our U.S. affi liate, together with
the effect of the €/USD exchange rate.
COST OF RAW MATERIALS, AUXILIARY MATERIALS, SPARE PARTS AND GOODS
(Euro/thousand) 31.12.2004 31.12.2003
Raw materials, auxiliary materials and consumables 19,586 20,352
Finished products 23,052 25,854
Goods 3,603 4,120
Other 1,861 1,893
Total for category 48,101 52,219
Service costs
These costs are detailed in the following table and compared with those of the previous year:
SERVICE COSTS
(Euro/thousand) 31.12.2004 31.12.2003
Subcontracting production costs 4,684 7,898
Galvanizing treatment costs 2,358 2,496
Other manufacturing services 1,686 2,270
Travel and transportation 5,604 5,218
Commissions expenses 8,859 7,707
Advertising and various selling expenses 11,472 11,176
Energy and telephone, etc. 1,337 1,572
Insurance 656 659
Consultancy costs 1,836 1,434
Legal expenses 301 255
Advertising royalties 5,943 5,176
Others 3,768 3,433
Total 48,504 49,295
Service costs decreased by a total of about € 791k. Considering the reclassifi cation mentioned earlier, we note that
- with application of the same accounting policy as that adopted in 2004 to fi gures as at December 31st 2003 -
service costs would have increased by about € 2,646k. This change was mainly due to high sales volume achieved
during 2004 with an incidence on sales of some 28%, substantially in line with the previous FY (about 29%).
Leasing, rental, and royalty costs
Leasing, rental and royalty costs increased by some 16.8% over the previous FY, rising from € 13,855k as at
December 31st 2003 to € 16,219k as at December 31st 2004.
The change versus the previous FY in terms of incidence on sales - up from approximately 8.8% in 2003 to about
9.4% in 2004 - was due to the increase of the cost of royalties paid to licensors.
Personnel costs
Personnel costs decreased by some € 1,308k over the previous FY (about -3.1%). This reduction is explained by the
combined effect of (a) reduction of the U.S. affi liate’s personnel costs by some € 2,257k, based on the reorganisation
plan and (b) a cost increase for some group companies, including Marcolin S.p.A., with the increase in the latter
case also being due to renewal of the national collective labour contract.
49

50
Consolidated Annual Report & Accounts
PERSONNEL COSTS
(Euro/thousand) 31.12.2004 31.12.2003
Wages and salaries 31,439 32,613
Social Charges 7,738 7,815
Staff leaving indemnity 888 918
Severance indemnities and similar commitments 163 168
Other costs 157 179
Total personnel costs 40,385 41,693
Depreciation, amortisation and write-downs
Neither amortisation of intangible fi xed assets nor depreciation of tangible fi xed assets underwent signifi cant
changes. For further detailed information, reference should be made to Attachment 2.
Write-down of receivables mainly stemmed from provisions made by Marcolin S.p.A. and amounting to some
€ 700k, following diffi culties emerging during the year for some customers, above all in the domestic market, and
posted in order to align receivables with their presumable realisation value.
Other fi nancial income
As regards the sub-items forming part of “Other fi nancial income”, we note that the balance of some € 604k as
at December 31st 2004 (vs. a balance of € 880k as at December 31st 2003) mainly consisted of income relating to
hedging transactions and to bank interest income.
Interest and other fi nancial charges
INTEREST AND OTHER FINANCIAL CHARGES
(Euro/thousand) 31.12.2004 31.12.2003
Bank interest expenses 1,996 1,908
Other Interest expenses 712 576
Total interest expenses 2,708 2,484
Other fi nancial charges 1,325 1,472
Total 4,034 3,956
GAINS AND LOSSES ON EXCHANGE RATE
(Euro/thousand) 31.12.2004 31.12.2003
Gains 1,801 1,651
Losses -1,800 -3,597
Total Gains and Losses on Exchange rate 1 -1,946
Bank interest expenses and Other interest expenses combined increased by some € 224k over the previous year.
Other fi nancial charges decreased by about € 146k and mainly consisted of cash discounts totalling € 793k, mainly
granted by the U.S. affi liate to its customers, and of other bank expenses.
Foreign-exchange gains as at December 31st 2004 amounted to about € 1,801k vs. a balance of some € 1,651k as at
December 31st 2003.
Foreign-exchange losses as at December 31st 2004 amounted to some € 1,800k vs. a balance of about € 3,597k as
at December 31st 2003.
We note that the net balance of foreign-exchange gains and losses went from a loss of some € -1,946k at the end
of the previous 2003 to substantial breakeven at the end of 2004. This was also due to exchange-rate hedging
transactions undertaken by the parent company.

Adjustments to value of fi nancial assets
Marcolin Group
Write-up of securities held as current assets
The amount shown in accounts includes write-back in the year of some € 187k on the value of the 681,000 shares
held by the parent company, posted within the limit of original cost, in order to align book value with the stock’s
market prices.
Extraordinary income and expenses
The following table details extraordinary income and expense items.
EXTRAORDINARY INCOME AND EXPENSES
(Euro/thousand) 31.12.2004 31.12.2003
Extraordinary income
Gain from the disposal of fi xed assets 43 7
Prior year income 108 97
Income from amounts written off 113 222
Compensation for damages 2 0
Income from variation in valuation criteria 0 0
Other extraordinary income 268 509
Total extraordinary income 534 835
Extraordinary expenses
Loss from the disposal of fi xed assets 40 63
Prior year expense 207 43
Expense from amounts written off 1 102
Expense from variation in valuation criteria 0 0
Other extraordinary charges 319 227
Income taxes on prior years 99 539
Total extraordinary expenses 666 975
Total Extraordinary income and expenses -132 -140
Extraordinary income totalled some € 534k, as opposed to a total of € 835k in the previous year, and mainly related
to the parent company (about € 230k) and Cébé (about € 158k).
Extraordinary expenses mainly related to charges for previous years’ taxes (some € 99k) and to realignment of
depreciation & amortisation at consolidated level (about € 200k).
Income taxes for the year
The total tax burden consists of current taxes and of the net balance of deferred-tax assets and liabilities.
The breakdown of the item was as follows:
INCOME TAXES
(Euro/thousand) 31.12.2004 31.12.2003
Current taxes 4,346 2,635
Deferred taxes 1,595 508
Accrued taxes -1,077 -2,852
Total Income Taxes 4,865 291
Net taxes increased from a net fi gure of € 291k as at December 31st 2003 to a net fi gure of € 4,865k as at
December 31st 2004, mainly payable by the group parent company.
51

52
Consolidated Annual Report & Accounts
Other information
In compliance with Attachment 3C, Template 1 of CONSOB Regulation no. 11971 of 14.5.1999, below we list
remuneration for directors, statutory auditors, and general managers.
REMUNERATION PAID TO DIRECTORS, STATUTORY AUDITORS AND GENERAL MANAGERS
Recipient Details of offi ce held Emoluments
Surname and name Offi ce From To Fringe
Benefi ts
Coffen Giovanni
Marcolin
Zandegiacomo
Maria Giovanna
Coffen Marcolin Maurizio
Coffen Marcolin Cirillo
Bortuzzo Antonio
(*) emoluments gross of social charges
The present year-end fi nancial statements provide truthful and proper representation of consolidated balance
sheet and fi nancial status and of the consolidated business result in the period concerned.
Giovanni Marcolin Coffen
Chairman of the Board of Directors
Longarone, March 18th 2005
Chairman of Board of Directors of Marcolin S.p.A.
Managing Director of Marcolin &. Co. S.p.A.
29-04-2004 approval 2006 fi n. stats.
234,000
500
Bonuses Other
Managing Director of Marcolin S.p.A. 23-04-2001 29 april 2004 37,800 54,000
Vice Chairman and Managing Director
of Marcolin S.p.A.
Managing Director of Marcolin S.p.A.
Vice Chairman and Managing Director
of Marcolin & Co. S.p.A.
Managing Director of Marcolin S.p.A.
General Director of Marcolin S.p.A.
C.E.O. Marcolin U.S.A. Inc.
29-04-2004 approval 2006 fi n. stats. 334,000 50,000
29-04-2004 approval 2006 fi n. stats.
29-04-2004
28-10-2002
01-09-2003
approval 2006 fi n. stats.
approval 2006 fi n. stats.
334,000
500
94,383
USD 104,978
Drago Giorgio Director of Marcolin S.p.A. 29-04-2004 approval 2006 fi n. stats. 10,500
Dallocchio Maurizio Director of Marcolin S.p.A. 29-04-2001 approval 2006 fi n. stats. 15,750
Alemagna Emanuele Director of Marcolin S.p.A. 23-04-2001 approval 2006 fi n. stats. 10,450
Ruella Cristiana Director of Marcolin S.p.A. 23-04-2001 29 april 2004 -
Petocchi Enrico Director of Marcolin S.p.A. 29-04-2004 approval 2006 fi n. stats. 3,500
50,000
150,000 161,934 *
Bartoletti Sandro Director of Marcolin S.p.A. 29-04-2004 approval 2006 fi n. stats. 20,000 88,642 *
Zulli Claudio Agostino
Rivetti Diego
D’Ambrosi
Galeazzo Osvaldo
Funes Rino
Chairman of the Board of Statutory Auditors
of Marcolin S.p.A. up to 29.04.2004
Chairman of the Board of Statutory Auditors
of Marcolin S.p.A. from 29.04.2004
Auditor Marcolin S.p.A.
Chairman of the Board of Statutory Auditors
of Marcolin & Co. S.p.A.
Auditor Marcolin S.p.A.
Auditor Marcolin & Co. S.p.A.
23-04-2001 29 april 2004 27,393
29-04-2004 approval 2006 fi n. stats. 6,759
29-04-2004 approval 2006 fi n. stats.
29-04-2004 approval 2006 fi n. stats.
Grazioli Emilio Alternate Auditor Marcolin S.p.A. 23-04-2001 approval 2003 fi n. stats. -
Guazzotti Giannantonio
Alternate Auditor Marcolin S.p.A.
Auditor Marcolin & Co. S.p.A.
23-04-2001 approval 2003 fi n. stats.
22,773
2,371
22,773
889
-
889

CONSOLIDATED STATEMENT OF CASH FLOWS
CONSOLIDATED STATEMENT OF CASH FLOWS
Marcolin Group
(Euro/thousand) 31.12.2004 31.12.2003
Net Financial Position - Beginning balance (43,908) (38,736)
ASSETS
Profi t (losses) during the year 1,159 (4,152)
Intangible assets amortization 1,872 3,065
Tangible assets depreciation 3,701 3,768
Provision for Staff Leaving Indemnities 888 918
Provision for Contingencies and Commitments 1,029 448
Other funds utilization (932) 29
(Gains) losses on disposals of fi xed assets - 4
Total cash fl ow generated from operations 7,717 4,081
(Increase) decrease in accounts receivable (8,952) 2,524
(Increase) decrease in other receivables 1,386 (3,210)
(Increase) decrease in inventories 5,067 (5,881)
(Increase) decrease in prepayments and accrued income 161 47
(Decrease) increase in accrued liabilities and deferred income 381 (586)
(Decrease) increase in accounts payables (4,325) 8,174
(Decrease) increase in other short-term debts and taxes 2,627 (1,652)
Employees’ Leaving Indemnity paid (356) (581)
Cash fl ow generated from working capital (4,012) (1,165)
ACTIVITY FROM INVESTMENTS
Investments / disposals intangible fi xed assets (1,658) (714)
Investments / disposals tangible fi xed assets (2,129) (2,770)
(Purchase) disposal of other investments and securities - revaluations 380 875
Cash fl ow from (for) investment activities (3,406) (2,609)
Equity increase - -
Payment of dividends - (1,295)
Change in reserves (917) (4,185)
Change in third parties equity - -
Total cash fl ow generated from equity movements (917) (5,480)
Net Financial Position - Closing balance (44,526) (43,908)
Detail of Cash and Cash equivalents - Closing balance 31.12.2004 31.12.2003
Treasury Stock 947 760
Cash on hand 9,280 14,439
Current payables due to banks (23,656) (29,156)
Medium/long-term payables due to banks (29,973) (28,877)
Other fi nancing payables (1,123) (1,073)
Total Net Financial Position (44,526) (43,908)
53

54
Consolidated Annual Report & Accounts
Attachment 1
INTANGIBLE
FIXED ASSETS
(Euro/thousand)
Startup and
expansion
costs
Research,
development
& advertising
costs
Patents
Concessions,
licenses,
trademarks
Assets under
construction
and advances
Other Consolidation
differences
Total at
31.12.2004
Beginning balance, net - 38 155 4.132 610 1,184 7,138 13,257
Increases 44 77 36 390 1,399 229 - 2,175
Disposals - - - - - (-9) - (-9)
Amortization (-44) (-23) (-125) (-796) - (-318) (-566) (-1,872)
Variation
consolidation area
- - - - - - - -
Translation difference - - - (-120) - (-2) (-387) (-509)
Other movements - - - - - - - -
Total other variations - - - - - - - -
Ending balance, net 92 66 3,607 2,009 1,083 6,186 13,042
TANGIBLE ASSETS
(Euro/thousand)
Land and
Buildings
Plant and
machineries
Industrial
and
commercial
equipment
Other
tangible
assets
Construction
in progress and
advances
Total at
31.12.2004
Opening balance
Historical cost 10,376 10,667 13,075 10,293 108 44,519
Depreciation on prior years (-3,661) (-8,605) (-11,090) (-6,952) - (-30,308)
Total Opening Balance 6,716 2,062 1,985 3,340 108 14,211
Change during the fi scal year
Acquisitions 41 166 1,468 745 56 2,477
Disposal of assets (-88) (-109) (-8) (-1,253) (-46) (-1,504)
Fund utilization 88 96 7 1,163 - 1,354
Fiscal year amortization (-346) (-1,212) (-845) (-1,297) - (-3,701)
Other movements - 575 (-494) - (-82)
Translation differences 31 (-64) - (-165) - (-198)
Total changes during the year (-274) (-547) 128 (-807) (-72) (-1,572)
Year-end balance
Historical cost 10,371 10,724 14,616 9,382 36 45,129
Depreciation on prior years (-3,929) (-9,209) (-12,503) (-6,849) - (-32,490)
Total Year-end balance 6,442 1,515 2,113 2,534 36 12,639

Attachment 2
MOVEMENT IN NET SHAREHOLDERS’ EQUITY
(Euro/thousand) Opening
Balance
Attachment 3
Disposition prior
year income
Payment of
dividends
Translation
difference
Result for
the period
Marcolin Group
Year-end
Balance
Capital Stock 23,597 23,597
Share premium reserve 21,950 21,950
Revaluation reserve - -
Legal Reserve 1,620 - 1,620
Treasury Stock reserve
Statutory reserve
760 186 946
- Cumulative translation adjustment (-8,525) (-917) (-9,442)
- Other -
Total other reserves (-8,525) (-917) (-9,442)
Profi t (losses) carried forward 18,092 (-4,338) - 13,755
Profi t (losses) on fi scal year (-4,152) 4,152 1,159 1,159
Total Shareholders’ Equity 53,342 - - (-917) 1,159 53,584
Third Party net equity - -
Minority interest - -
Total Shareholders’ equity 53,342 - - (-917) 1,159 53,584
CHANGES IN SHAREHOLDERS’ EQUITY ATTRIBUTABLE TO THE GROUP
(Euro/thousand) Equity Net result
Balance per Marcolin S.p.A. Financial statements 53,766 1,654
Difference from application of International accounting principle 636 35
Elimination of accrual and adj. Made for tax reasons - (-2,265)
Elimination of intercompany transactions (-2,489) (-609)
Difference between book value and net equity value of investments
in subsidiaries on consolidated balance sheet
1,007 1,720
Deferred taxes 664 625
Total shareholders’ equity 53,584 1,158
55

56
Consolidated Annual Report & Accounts
Attachment 4
PAYABLES - MATURITY ANALYSIS
(Euro/thousand) Within
one year
After one year
and within 5 years
After 5 years Total
31.12.2004
Total
31.12.2003
D) PAYABLES
1 Bonds - - - - -
2 Convertible Bonds - - - - -
3 Payable to Shareholders for fi nancing - - - - -
4 Due to banks 23,656 29,973 - 53,629 58,034
5 Due to others fi nanciers 148 975 - 1,123 1,073
6 Advances - - - - -
7 Trade payables 28,475 - - 28,475 32,428
8 Notes payables - 54 - 54 161
9 Due to subsidiaries - - - - -
10 Due to associated companies 1,117 - - 1,117 1,117
11 Due to parent companies - - - - -
12 Taxes payable 4,217 - - 4,217 1,675
13 Social security payables 1,727 - - 1,727 1,641
14 Other payables 3,261 88 - 3,348 3,613
Total payables 62,601 31,090 - 93,690 99,742

Marcolin S.p.A.
STATUTORY ANNUAL REPORT & ACCOUNTS
FOR THE YEAR ENDING ON DECEMBER 31ST
2004 MARCOLIN S.p.A.
73

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Statutory Annual Report & Accounts
REPORT ON OPERATING PERFORMANCE
FOR THE YEAR ENDING ON DECEMBER 31ST
2004 MARCOLIN S.p.A.

To Our Shareholders
Marcolin S.p.A.
Before starting our report, we wish to point out that, as regards the fourth quarter of 2004, the company has availed
itself of the possibility given by Article 82, paragraph 2, letter b), of the CONSOB (Italian listed company & stock
market surveillance commission) Regulation 11971/1991, and its subsequent amendments, concerning exoneration
from the drafting and preparation of a quarterly report. Consequently, it will make a copy of the consolidated and
statutory annual reports and accounts available at the company’s registered offi ces and at those of Borsa Italiana S.p.A.
within the terms indicated in the aforementioned regulation.
The fi nancial year (FY) ending on December 31st 2004 showed a net profi t of some € 1,654k (vs. a net loss of
about € -6,147k as up to December 31st 2003) and sales of some € 98,371k (vs. some € 85,794k as up to December
31st 2003).
The sales breakdown by geographical area was as follows:
AREA 31.12.2004 31.12.2003 Difference
(Euro/thousand) Turnover % On total Turnover % On total Difference %
Geographical area
- Italy 40,451,185 41.12 32,803,661 38.24 23.31
- Europe 37,541,844 38.16 35,379,755 41.24 6.11
- U.S.A. 5,652,535 5.75 5,541,872 6.46 2.00
- Rest of the world 14,725,779 14.97 12,068,563 14.07 22.02
Total 98,371,342 100.00 85,793,850 100.00 14.66
Analysis of the fi gures shown in the table shows an increase in sales value of some € 12,577k (about +14.6% vs. the
2003 fi gure) with marked growth more or less in all markets, spread as follows: domestic market approximately
+23.3%, European market +6.1%, U.S. market +2%, and rest of the world +14%.
Particularly strong contributors to this improvement were the lines “Dolce & Gabbana Eyewear” (sales up by +24%
vs. 2003) and “D&G Dolce & Gabbana Eyewear” (+16% YoY), also thanks to the new collections presented. We also
highlight the excellent performance of the “Roberto Cavalli Eyewear” lines (+68%).
As regards sales to affi liates, we particularly note the positive increase in revenues from sales to the Spanish
affi liate of about € 1,287k (about +21% YoY) and to the French affi liate of about € 649k (about +22% YoY).
We also note the good increase achieved in other countries, among which we highlight Greece (+11%) and
Australia (+45%).
As regards the main operating fi gures concerning ordinary business, we highlight the following items:
PROFIT & LOSS STATEMENT
(Euro/thousand) 31.12.2004 31.12.2003
Value of production 99,695 89,717
Cost of production 88,733 82,153
EBITDA 14,936 11,989
Difference between the value of production and cost of
production (EBIT)
10,962 7,564
Net result 1,654 (6,148)
Production costs increased by some € 6,580k (+8%) vs. the fi gure as at December 31st 2003 - less than proportionally
compared with the increase in sales (+15%), which rose from some € 85,794k in 2003 to about € 98,371k in 2004.
75

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Statutory Annual Report & Accounts
EBITDA margin on sales was approximately 15% (vs. some 14% in the previous FY) with an outright value of some
€ 14,936k (€ 11,989k as up to December 31st 2003).
The difference between production value and costs (i.e. EBIT) feature an 11% margin on sales (vs. 9% as at
December 31st 2003), corresponding to about € 10,962k (vs. some € 7,564k as at December 31st 2003).
The year’s bottom-line result, with net profi t of some € 1,654k, included extraordinary income of some € 2,065k
and related deferred tax liabilities of € 721k - both stemming from “decontamination” of accounts of the tax effects
of accelerated depreciation posted in previous years. This was necessary due to application of the requirements
of Italian Legislative Decree no. 6 of January 17th 2003, which abrogated the second paragraph of Article 2426 of
the Italian Civil Code - i.e. of the article that permitted adjustments to value and provisioning solely in order to
apply tax regulations (reference should be made to the Explanatory Notes to Accounts for the table summarising
the effects of this “decontamination”).
Tax charges for the year, including the effect of deferred taxes (€ 907k) totalled some € 4,661k (as opposed to a
positive fi gure of some € 787k in the previous FY).
Below we provide the following detail concerning the main operating costs:
COSTS
(Euro/thousand) 31.12.2004 31.12.2003
Raw materials, consumables, fi nished products costs -16,259 -15,912
Service costs -33,948 -29,565
Leasing and rental -26,301 -27,383
Personnel costs -7,667 -5,574
Depreciations and devaluations -2,486 -3,165
Interests and other fi nancial charges -2,503 -2,206
Profi t (loss) on exchange rate -110 -1,914
As regards costs for the purchase of raw materials, semi-fi nished goods, and fi nished products, these increased
by € 4,383k (about +14.8% vs. 2003). We point out that, during 2004, accounting reclassifi cation was undertaken of
some costs concerning components that in 2003 had been posted among service costs.
Based on application of the same accounting policy as that applied in 2004, at the end of December 2003 these
costs would have totalled € 33,002k. Consequently, the real increase vs. 2003 was about € 946k (+3%). This change
shows that, notwithstanding the increase in business turnover during the year, the company restrained the increase
of these costs - also following improved management of procurement and of manufacturing input factors.
Taking the above-mentioned reclassifi cation into account, service costs would in effect have increased by some
€ 2,355k (+10% YoY).
This increase was mainly explained by:
• The slight increase - i.e. of some € 224k - in the use of outsourcing (+4% YoY). This increase was limited
compared with the sales increase due to the effect of both (a) sale of new products whose production
does not require use of special processes and (b) optimisation of in-house operations;
• The increase - by some € 1,416k - substantially proportional to sales growth of variable selling costs
such as royalties, advertising and commission (+19% YoY);
• An increase in travel & accommodation and other commercial expenses (about € 345k).
As regards leasing, rental and royalty costs, which increased by some € 2,092k (about +37.5%), the change vs. the
same costs in 2003 was due to increase in royalty costs. The latter was in turn due to the combined effect of sales
growth and of failure to achieve the contractual minimum for some lines.
There was a limited YoY increase in payroll costs, i.e. € 347k (+2%) and this was ascribable to contractually
envisaged increases.

Marcolin S.p.A.
Interest expenses and fi nancial charges increased by about € 297k due to a higher cost of debt. Foreign-exchange
losses decreased from some € -1,914k as at December 31st 2003 to about € -110k, showing clear improvement also
as a result of hedging operations undertaken during the year.
Financial trend and position (amounts in euro/thousand)
FINANCIAL POSITION
(Euro/thousand) 31.12.2004 31.12.2003
Treasury Stock 947 760
Cash on hand 3,226 7,219
Total fi nancial liquidity 4,173 7,979
Current payables due to banks 13,982 17,615
Medium/long-term payables due to banks 29,773 25,767
Other fi nancing payables 793 576
Total borrowings 44,548 43,958
Net Financial Position -40,375 -35,979
The year-end net fi nancial position (NFP) showed net debt of some € -40,3 mn vs. debt of some € -35,9 mn at
the end of 2003. We point out that, as at December 31st 2004, had no factoring of trade receivables in place - in
contrast with status as at December 31st 2003, which featured no-recourse factoring of trade receivables totalling
some € 7,712k. Given this, based on comparable conditions, NFP as at December 31st 2004 improves by some
€3,315k vs. 2003 year-end, even although there is still a negative variation of some € 4,396k.
The improvement of NFP, after stripping out the factoring effect from 2003 year-end NFP, was ascribable to
improved operating management and to a reduction in net working capital (NWC). More specifi cally, we highlight
the fact that:
• Trade receivables, adjusted to eliminate the factoring effect just mentioned, improved as a percentage
of sales also thanks to reduction of the average payment days granted to customers;
• Inventory value decreased by some € 1,1 mn;
• Trade payments decreased by some € 2,7 mn;
• Total investments - made principally for the new ERP system, and replacement of plant and industrial
& commercial equipment, plus other assets - totalled € 3,5 mn.
For further details, reference should be made to the cash fl ow statement attached to the Explanatory Notes
to Accounts.
It should be pointed out that, in order to optimise fi nancial management at group level, the group parent company
Marcolin S.p.A. fi nanced the subsidiary Cébé S.A. for some € 2 mn and the Swiss affi liate Marcolin GmbH for
some CHF 3,5 mn (about € 2,268k).
As far as debt breakdown is concerned, we note consolidation of the medium- and long-term portion vs. the end
of 2003, via increased utilisation, by € 12 mn, of the revolving stand-by credit facility, received for a total of € 20 mn
and based on a loan contract signed at the end of 2003.
As at December 31st 2004 total utilisation of the aforementioned credit facility amounted to € 17 mn.
We further note that, during the year, the parent company repaid principal totalling some € 8,234k for loans
granted in previous years.
We also point out that all loans taken out during the year were granted at going market rates without provision
of collateral.
77

78
Statutory Annual Report & Accounts
In order to round off analysis of fi nancial status, we note that the group’s net debt/equity ratio, which was 0.75,
remained substantially balanced vs. December 31st 2003 when it was 0.60.
For the sake of clarity, it is noted that the 2003 ratio - based on NFP net of factoring - would have been 0.84.
BALANCE SHEET
(Euro/thousand) 31.12.2004 31.12.2003
Assets
Fixed assets 45,526 43,638
Current assets 89,112 87,092
Prepayments and accrued income 580 972
Total
Liabilities
135,218 131,702
Shareholders’equity 53,766 52,111
Provisions and payables 80,835 79,057
Accrued liabilities and deferred charges 616 534
Total 135,218 131,702
Investments made during the FY mainly related to tangible fi xed assets, for an amount of some € 1,571k. These
costs were borne mainly for the purchase of industrial & commercial equipment (about € 972k), besides electronic
machines and machinery, trade show furnishings, and offi ce furniture (about € 570k). As regards intangible fi xed
assets, we note that the company made investments for creation of the new SAP ERP system (about € 1,399k) and
investments of some € 300k in other management information systems.
As regards the value of fi nancial fi xed assets, we point out that, at year-end, we wrote down the book value of equity
interests owned in the subsidiaries Marcolin do Brasil Ltda., Marcolin Deutschland GmbH, Marcolin France S.a.r.l.,
and Marcolin U.S.A. Inc. due to impairment (permanent loss) of value for a total of some € 6,700k. We also wrote
back the value, within the limits of original cost, of the investee companies Marcolin U.K. Ltd. and Marcolin Iberica
S.A. by some € 1,303k, since the permanent nature of loss had ceased to exist.
As instead regards current assets, without taking into account the factoring operations mentioned above, there was
an increase in cash & banks (about € 3,719k) set against a decrease in inventory value (about € 1,079k)
The increase in provisioned reserves and payables was due to the combined effect of (a) an increase in taxes
payable of some € 2,604k (in FY2003 there were no taxes payable since the balance - some € 677k - was among
taxes receivable) plus a reduction in trade payables and in amounts payable to group companies of some € 2,700k
and (b) increase of some € 1,264k in provisioned accruals for risks and contingencies mainly due to provisioning
in the year of some € 842k of deferred taxes.
Transactions with subsidiary, associated, and parent companies
During year there were commercial and fi nancial transactions with foreign subsidiaries, commercial transactions
with Finitec S.r.l., and fi nancial transactions with Marcolin & Co. S.p.A. All transactions took place on a normal
arm’s length basis.
The details of receivables and payables, plus those of revenues and costs, relating to transactions undertaken with
subsidiary and associated companies has been shown in the Explanatory Notes in the comments on relevant items
in year-end accounts.

Marcolin S.p.A.
Below we show the total value of transactions undertaken in the year with subsidiary and associated companies
(amounts in euro/thousand):
TRANSACTIONS WITH SUBSIDIARY AND ASSOCIATED COMPANIES
As regards the fi gures shown in the previous table, we point out - summarising - the revenues from sales and
services refer to sales to foreign subsidiaries.
Other revenues and income mainly refer to charge-back to subsidiaries of freight and advertising costs (€ 628k)
and to fi nancial income (interest earned on loans granted) of some € 292k.
Costs debited mainly related to:
• € 3,935k for purchases of fi nished products from foreign subsidiaries;
• € 1,688k for processing performed by the associated company Finitec S.r.l.;
• € 540k and € 100k respectively for charging of services by the subsidiary Marcolin Asia Ltd.
and by Cébé.
• € 23k for interest charged on a loan granted by the subsidiary Marcolin & Co. S.p.A.
Receivables and payables have been listed in the comments on the relevant items in year-end accounts and mainly
refer to loans granted to group companies to provide the necessary fi nancial funding, thus optimising related
fi nancial costs, and to commercial transactions.
All business and fi nancial transactions with subsidiary and associated companies have been based on normal
arm’s length conditions.
Research and development activities
R&D activities are performed using two divisions. The fi rst of these, consisting of a centralised organisation (based
in Treviso) has the tasks of creation - in close collaboration with licensors - of new collections, styling, research
into new materials, and development of collections for sunglasses, prescription eyewear, and sports eyewear. The
second, which works closely with the other division, handles product development and industrialisation.
During the previous FY the company, under Italian Law no. 46 of February 17th 1982, was considered eligible to
benefi t from the revolving technological innovation fund for a total cost of about € 1,652k - which can be issued in
the form of low-rate fi nancing and grants. We fi led application based on a project for the study and development
of new technologies applicable to the sector of alpine goggles and eyewear. During the year the group parent
company thus received a loan of some € 793k and a grant of about € 78k.
Signifi cant events occurring after year-end
and expected business progress
31.12.2004 31.12.2003
Revenues from sales and services 31,022 30,275
Other income 687 591
Financial income 292 246
Other re-charge 6,263 4,938
As regards signifi cant events occurring after 2004 year-end, to aid understanding we refer readers to the analytical
description provided in the Report on Operating performance in the Consolidated Annual Report.
As instead regards expected business progress, we point out - as already highlighted in the Consolidated Annual
Report - that it is possible that, in the second half of 2005, operating performance may refl ect the adverse effects
stemming from notifi cation received in October 2004 from the licensor Dolce & Gabbana of its decision not to
renew the licensing contract due to expire on December 31st 2005 for the Dolce & Gabbana Eyewear and D&G
Dolce & Gabbana Eyewear lines. In the short term these adverse effects can only be partly offset by development
79

80
Statutory Annual Report & Accounts
of existing licenses and by possible acquisition of new licenses - with the latter aided by entry into Marcolin’s
share capital of the brothers Diego and Andrea Della Valle (well known industrialists active in the luxury sector).
Their entry into capital will make it possible to make the Marcolin core shareholder group stable over time, also
enabling the company to benefi t from important contacts and relationships at international level in the fashion
and luxury sector.
Other information
Employee headcount was 491 as at 31.12.2004 vs. 510 employees as at 31.12.2003.
The assignment for certifi cation of statutory and consolidated annual reports and of the fi rst-half interim report
was awarded, based on a shareholders’ resolution passed on April 30th 2002, to the independent auditing
fi rm PricewaterhouseCoopers S.p.A. The latter’s mandate expires with the audit of FY2004 year-end fi nancial
statements.
As required by paragraph II of Article 2428 of the Italian Civil Code, we also provide the following information:
• As at December 31st 2004 Marcolin S.p.A. held, as current assets, 681,000 of its own shares, for a total
nominal value of € 354,120.00 and accounting for 1.50% of share capital.
Book value is € 946,589.00 and refl ects the stock’s price on December 31st 2004. Share buy-back has
been authorised within the maximum limit of 4,537,800 shares, equivalent to 10% of share capital.
No group company owns shares in the parent company.
The company’s head offi ce and other offi ces are located in Longarone (province of Belluno).
Transition to IAS/IFRS
During 2004 work continued in the group on development and completion of the project for transition to
international accounting principles (IAS/IFRS). The work currently underway aims to determine P&L and balancesheet
impact, the results of which must be submitted to the independent auditor for review, with the objective of
applying the new standards within the terms envisaged by regulations.
More specifi cally, we completed the fi rst phase of analysis and preliminary study in order to pinpoint the main
differences between Italian accounting standards and IAS/IFRS and areas that will necessarily change due to
application of the new standards.
The activity continued determining the new standards applicable to the group and analysing their impact on
corporate administrative processes and businesses.
As a result of this activity, the areas where IAS application will lead to important changes have emerged as being
the following:
• Tangible fi xed assets: IAS envisage two methods for quantifying these items in accounts, i.e. depreciated
cost and fair value. In addition, depreciation must refl ect assets’ effective useful working life.
Determination is currently underway of the useful working life of assets to be subjected to depreciation
and of their residual value, as well as the separation of land value from that of building.
This work should be completed shortly with determination of the fi gures concerned and choice of the
most suitable accounting policy for the company.
• Inventories: we already quantify inventories on the basis of weighted average cost as envisaged by IAS.
Consequently the new standards will have no impact on present inventory value.
• Employee severance indemnity reserve: according to IAS the reserve and provisioning for employee
severance indemnities comes under the defi nition of “post-retirement benefi ts” and liability therefore
has to undergo actuarial valuation.
Apart from employee severance indemnities, the group has no particular long-term benefi ts for
employees. Marcolin S.p.A. has made use of a consulting fi rm in order to recalculate the value of the
employee severance indemnity reserve and provisioning. This work will be completed shortly.
• Derivatives: under IAS/IFRS all derivatives must be refl ected in accounts at their relevant fair value.
Accounting treatment of derivatives varies depending on their characteristics (hedging of business

Marcolin S.p.A.
risk and speculative instruments). The company has already applied this policy in year-end fi nancial
statements for both 2003 and 2004.
The fi nal phase, currently underway, focuses on calculation of the economic and fi nancial impact to be applied to
the various accounting items with the objective of adopting IAS/IFRS within the terms envisaged by regulations.
Corporate Governance
Once again during FY2004 Marcolin S.p.A. continued to implement initiatives designed to (i) refl ect the standards
and key guidelines contained in the Italian Self-Governance Code for Listed Companies and (ii) implement an
appropriate corporate governance system, via a process of constant adjustment of decision-making and operational
mechanisms started in previous years.
Below we highlight, in summary form, the main novelties characterising the company’s overall corporate governance
system in FY2004.
To round off the information on corporate governance provided here, we point out that, as envisaged by the Italian
Committee for Listed Companies’ Corporate Governance - co-ordinated by Borsa Italiana S.p.A. - and by section
IA.2.14 of the “Instructions to the Regulation for Markets Organised and Managed by Borsa Italiana S.p.A.”, on
occasion of the Annual General Meeting of Shareholders held to approve these year-end fi nancial statements, a
report on our corporate governance system will, as is customary, be made available to shareholders.
Internal Auditing Committee
As regards initiatives taken concerning operation of the Internal Audit Committee, we note that in February 2004
the Board of Directors approved the house regulation governing the Internal Auditing Committee’s membership
and tasks and the approach for summoning and management of the Committee’s meetings.
During 2004 the company implemented (a) the organisation/management/control model devised as per
Italian Law 231/2001 (“the Model”) and (b) the new business management information system chosen by the
company (SAP).
As regards the Model, following its offi cial approval in March 2004, the Corporate Code of Business Ethics was
approved in July 2004. In September of the same year the procedures rendering the Model operational were
implemented and brought to the attention of the parties involved.
The Board of Directors, when approving the draft annual report & accounts for the year ending on December 31st
2004, also approved, among other things, the Self-Assessment Document prepared as per the provisions contained
in the Italian Self-Governance Code for Listed Companies. This is used to assess the adequacy and effective
functioning of the overall internal audit and control system.
Remuneration Committee
On May 13th 2004, with a resolution passed by the Board of Directors a Remuneration Committee was created,
consisting of the following Board members:
• Emanuele Alemagna - non-executive and independent director (President);
• Maurizio Dallocchio - non-executive and independent director;
• Giorgio Drago - non-executive director.
The Remuneration Committee was able to make recommendations concerning remuneration for executive
directors and those holding particular positions, as regards the portion of remuneration decided upon by the
shareholders’ meeting to be split between the same directors, when determining remuneration for FY2004.
Statutory amendments
On September 13th 2004, the Extraordinary Shareholders’ Meeting passed resolutions approving several
amendments to our Articles of Association, also in order to adapt their content to the new rules for joint-stock
companies introduced by Italian Legislative Decree no. 6 of January 17th 2003 and subsequent amendments.
Among the amendments made, we highlight the inclusion in Article 12 of the Articles of Association of the
provision giving shareholders the possibility of postal voting, based on current regulations.
81

82
Statutory Annual Report & Accounts
Information on abnormal and unusual transactions and transactions with related parties
With reference to the recommendation made in CONSOB memorandum DAC/98015375 dated February 17th 1998,
below we provide the required information concerning abnormal and unusual transactions and transactions with
related parties.
Abnormal or unusual transactions
During 2004 Marcolin S.p.A. and subsidiary companies belonging to the Marcolin Group did not undertake any
transactions outside of the normal course of business or such as to signifi cantly infl uence the business, capital and
fi nancial status of Marcolin S.p.A. and of the group.
Transactions with related parties
We note that in FY2004 a consulting agreement was signed with Mrs. Maria Giovanna Zandegiacomo, who owns
an equity interest in Marcolin S.p.A., for fees of some € 54k in 2004 and € 85k for 2005.
These transactions were approved by the Board of Directors.
As regards transactions with subsidiary and associated companies, the details of capital, business and fi nancial
transactions are provided in the Explanatory Notes in the comments on relevant items in accounts. There were no
further transactions with related parties to report.
Other disclosures
We point out that the company has not opted to sign on for domestic tax consolidation - pursuant to
Articles 117-129 of Italian Presidential Decree no. 917/1986 - given the absence of major equity interests in
Italian companies.
Marcolin S.p.A. is not subject to activities of direction and co-ordination by other companies, as defi ned in Articles
2497 et seq. of the Italian Civil Code.
Privacy Regulations - Italian Legislative Decree no. 196/2003
During 2004 we reviewed the issues of protection of individual and corporate personal data regulated by Italian
Legislative Decree no. 196 dated June 30th 2003. We are about to complete the Plan for Security Measures, with
the deadline for completion fi xed for December 31st 2005. By the end of 2005 defi nition will be completed of the
technical work required for application of mandatory minimum security measures as contemplated by the above
decree’s set of technical rules.
Organisation/management/control model pursuant to Italian Law 231/2001
During 2004 the company implemented the organisation/management/control model devised as per Italian Law
231/2001 and approved in March 2004 (“the Model”).
In addition, the Corporate Code of Business Ethics was approved in July 2004. In September of the same year the
procedures rendering the Model operational were implemented and brought to the attention of the parties involved.
Lastly, it should be remembered that the Model, since it is aligned with the standards indicated in the documents
issued by Confi ndustria (the Italian Confederation of Industry) on the matter (the so-called Guidelines), can be
considered to be an adequate tool for achievement of the objectives fi xed by relevant regulations.
Equity interests owned by Directors, Statutory Auditors and by the General Manager
In compliance with Attachment 3C, Template 3 of CONSOB Regulation no. 11971 dated 14/5/1999, below we
list the equity interests owned in group companies by the directors, statutory auditors, and general managers
as at the year-end date of December 31st 2004. We have therefore not taken into account effects following the
outcome of the Public Tender Offer mentioned earlier.

Name
(1) Executive Director and General Manager of Marcolin S.p.A.
Marcolin S.p.A.
* The 6,882,876 shares indicated in the table for Mr. Giovanni Marcolin Coffen relate to the latter’s usufruct rights on an equal number of shares, the bare
ownership of which is held by the company Inmar International S.A., controlled by him.
** The 1,474,785 shares shown in the table for Mr. Cirillo Coffen Marcolin relate to the latter’s usufruct rights on an equal number of shares, the bare
ownership of which is held by Inmar International S.A.
*** The 1,474,785 shares shown in the table for Mr. Maurizio Coffen Marcolin relate to the latter’s usufruct rights on an equal number of shares, the bare
ownership of which is held by Inmar International S.A.
**** The 930,183 shares shown in the table for Mrs. Maria Giovanna Zandegiacomo relate to the latter’s usufruct rights on an equal number of shares, the
bare ownership of which is held by Inmar International S.A.
There are no other important facts to report that may have signifi cantly infl uenced the company’s operating
performance or modifi ed its capital, fi nancial and business structure.
The Board thanks all staff for their work and the Board of Statutory Auditors and the independent auditor for
their supervisory and control activity and recommendations.
Proposal for allocation of the year’s earnings
To our shareholders,
The statutory year-end fi nancial statements that we submit for your approval show a net profi t posted in accounts
as totalling € 1,654,453.00, which we propose be allocated as follows:
• € 82,722.65 to the Legal Reserve
• € 1,571,730.35 to profi ts carried forward.
Giovanni Marcolin Coffen
Chairman of the Board of Directors
Longarone, March 18th 2005
Partecipated companies N. of shares
held at
31.12.2003
Giovanni Marcolin Coffen Marcolin S.p.A.
Cébé S.A.
Marcolin & Co. S.p.A.
Cirillo Coffen Marcolin Marcolin S.p.A.
Marcolin France S.a.r.l.
Marcolin U.K. Ltd.
Cébé S.A.
Marcolin Portugal Lda.
Maurizio Coffen Marcolin Marcolin S.p.A.
Cébé S.A.
Marcolin Benelux S.p.r.l.
18,430,416
1
465
3,179,533
4 share
1 share
1
1 share
3,179,533
1
1 share
Purchase Sale N. of shares
held at
31.12.2004
11,547,540 6,882,876
1
465
*
1,704,748 1,474,785
4 share
1 share
1
1 share
**
1,704,748 1,474,785
1
1 share
***
Maria Giovanna Zandegiacomo Marcolin S.p.A.
1,435,659 ** 505,476 930,183 ****
Cébé S.A.
1
1
Antonio Bortuzzo (1) Marcolin S.p.A. 56,000 40,000 61,600 34,400
Giorgio Drago Marcolin S.p.A. 0 30,000 30,000
83

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Statutory Annual Report & Accounts
BALANCE SHEET - MARCOLIN S.p.A.
31.12.2004 31.12.2003
ASSETS
A) Share capital issued and not yet paid 0 0
of which already claimed
B) Fixed assets
I Intangible fi xed assets
1 Installation and expansion cost 0 190
2 Research, development and advertising cost 0 2
3 Industrial and other patent rights 66,066 154,625
4 Concessions, licenses, trademarks and similar rights 274,980 70,535
5 Goodwill 14,926 17,414
6 Assets under construction and advances 2,008,938 609,718
7 Other intangible assets 1,057,743 1,133,944
Total intangible assets 3,422,653 1,986,427
II Tangible fi xed assets
1 Land and buildings 1,995,332 2,021,491
2 Plant and machineries 1,373,003 804,485
3 Industrial and commercial equipments 1,157,116 568,991
4 Other goods 1,370,717 856,468
5 Construction in progress and advances 16,467
Total tangible assets 5,896,168 4,267,902
III Financial assets
1 Investments
a) subsidiaries 23,285,019 28,682,373
b) associated companies
c) parent companies
d) other companies
258,228 258,228
Total investments
2 Receivables
23,543,248 28,940,602
a) from subsidiaries - within 12 months
- after 12 months
12,627,807 8,344,351
b) from associated companies - within 12 months
- after 12 months
c) from parent companies - within 12 months
- after 12 months
d) other - within 12 months
- after 12 months 35,866 99,064
Total receivables
3 Other securities
4 Treasury stock
12,663,673 8,443,415
Total fi nancial assets 36,206,921 37,384,017
Total fi xed assets 45,525,742 43,638,346

BALANCE SHEET - MARCOLIN S.p.A.
C) Current assets
Marcolin S.p.A.
31.12.2004 31.12.2003
I Inventories
1 Raw materials, auxiliary materials and spare parts 6,353,997 6,701,463
2 Work in progress
3 Contract work in progress
4,501,241 4,066,526
4 Finished goods
5 Advances
14,977,189 16,143,636
Total inventory 25,832,427 26,911,625
II Receivables
1 Trade receivables - within 12 months
- after 12 months
33,527,155 22,480,304
2 Receivables from subsidiaries - within 12 months
- after 12 months
20,467,696 23,023,103
3 Receivables from associated companies - within 12 months
- after 12 months
4 Receivables from parent companies - within 12 months
- after 12 months
4-bis Receivables from tax authorities - within 12 months
- after 12 months
677,287
4-ter Accrued taxes - within 12 months 2,435,474 2,277,356
- after 12 months 2,314,981 3,309,820
5 Other receivables - within 12 months
- after 12 months
362,178 433,993
Total receivables 59,107,484 52,201,863
III Short-term investments
1 Investments in subsidiaries
2 Investments in associated companies
3 Investments in parent companies
4 Other Investments
5 Treasury stock
6 Other securities
946,589 759,996
Total short-term investments
IV Cash and banks
946,589 759,996
1 Bank and postal deposits 3,218,237 7,201,738
2 Cheques 613 5,471
3 Cash on hand 6,890 11,669
Total cash and banks 3,225,740 7,218,878
TOTAL CURRENT ASSETS 89,112,240 87,092,362
D) Prepayments and accrued income 579,510 971,716
TOTAL ASSETS 135,217,492 131,702,424
85

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Statutory Annual Report & Accounts
BALANCE SHEET - MARCOLIN S.p.A.
LIABILITIES AND SHAREHOLDERS’ EQUITY
A) Shareholders’ equity
31.12.2004 31.12.2003
I Share capital 23,596,560 23,596,560
II Share premium reserve 21,950,034 21,950,034
III Revaluation reserve
IV Legal reserve 1,620,170 1,620,170
V Statutory reserves
VI Reserve for treasury stock 946,589 759,996
VII Other reserves
Currency conversion reserve
VIII Profi ts (losses) carried forward 3,997,980 10,332,528
IX Profi t (loss) for the year 1,654,453 (6,147,956)
Total shareholders’ equity of the Group
Profi ts (losses) of competence of third parties
53,765,786 52,111,333
Equity and reserves of competence of third parties
Net Equity of competence of third parties
TOTAL SHAREHOLDERS’ EQUITY
B) Provisions for contingencies and commitments
53,765,786 52,111,333
1 Provision for severance indemnities and similar commitments 731,522 575,707
2 Provision for deferred taxes 910,711 68,801
3 Other provisions 1,289,584 1,023,004
Total provisions for contingencies and commitments 2,931,817 1,667,511
C) Staff leaving indemnity
D) Payables
4,580,774 4,373,910
1 Bonds and debentures - within 12 months
- after 12 months
2 Convertible bonds - within 12 months
- after 12 months
3 Banks loans and overdrafts - within 12 months 13,982,096 17,614,887
- after 12 months 29,772,865 25,766,694
4 Other fi nancing payables - within 12 months 0 575,880
- after 12 months 793,171 0
5 Advances - within 12 months
- after 12 months
6 Trade payables - within 12 months
- after 12 months
20,551,879 22,420,522
7 Notes payables - within 12 months
- after 12 months
8 Payables to subsidiaries - within 12 months
- after 12 months
1,888,408 2,719,136
9 Payables to associated companies - within 12 months
- after 12 months
1,117,161 1,116,980
10 Payables to parent companies - within 12 months
- after 12 months
11 Taxes payable - within 12 months
- after 12 months
2,604,120 0
12 Social security payables - within 12 months
- after 12 months
806,739 793,051
13 Other payables - within 12 months
- after 12 months
1,806,258 2,008,892
Total payables 73,322,697 73,016,042
E) Accrued liabilities and deferred charges 616,417 533,628
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY 135,217,491 131,702,424

Marcolin S.p.A.
MEMORANDUM ACCOUNTS 31.12.2004 31.12.2003
Risks
a) Guarantees lended to third parties 2,032,914 1,633,530
b) Guarantees lended to subsidiaries 2,976,000 3,731,754
c) Other guarantees lended to subsidiaries
Goods in third parties hands
2,301,639 4,057,986
Committments 333,084 1,709,984
Total memorandum accounts 7,643,637 11,133,254
INCOME STATEMENT - MARCOLIN S.p.A.
31.12.2004 31.12.2003
A) Value of production
1 Revenues from sales and services 98,371,342 85,793,850
2 Changes in work in progress 0
3 Variations in contracted work in progress (731,733) 2,534,971
4 Increase in internal construction capitalized 734,039 368,000
5 Other income
a) grants and subsidies 0 0
b) other 1,321,523 1,020,356
Total other income 1,321,523 1,020,356
Total value of production
B) Cost of production
99,695,172 89,717,176
6 Cost of raw materials, auxiliary materials, spare parts and goods 33,948,191 29,564,757
7 Costs for services 26,300,580 27,382,778
8 Cost for utilization of third parties’ assets (leasing) 7,666,655 5,574,495
9 Personnel costs
a) salaries and wages 11,655,980 11,407,021
b) social contributions 3,713,156 3,637,179
c) staff leaving indemnity 873,245 857,638
d) other social contributions 0 0
e) other costs 16,476 10,231
Total personnel costs 16,258,857 15,912,071
10 Depreciation and write-down
a) amortization of intangible assets 523,365 1,107,785
b) depreciation of tangible fi xed assets 1,962,249 2,057,391
c) other writes-down of assets 0 43,133
d) write-down of receivables recorded among current assets 700,000 1,032,189
Total depreciation and write-down
11 Change in inventory of raw materials, auxiliary
3,185,614 4,240,499
materials, spare parts and goods 347,466 (1,007,691)
12 Accruals for contingencies 790,095 183,814
13 Other accruals 0 0
14 Other operating charges 235,841 302,029
Total cost of production 88,733,300 82,152,753
DIFFERENCE BETWEEN VALUE AND COST OF PRODUCTION (A-B) 10,961,872 7,564,423
87

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Statutory Annual Report & Accounts
INCOME STATEMENT - MARCOLIN S.p.A.
31.12.2004 31.12.2003
C) Financial income and charges
15 Income from investments
a) dividends from subsidiaries 930,629 0
b) dividends from associated companies 0 0
c) dividends from other investments 0 0
d) other income from investments 0 0
Total income from investments
16 Other fi nancial income
a) from receivables recorded as fi xed assets:
930,629 0
- subsidiaries 292,062 245,645
- associated companies 0 0
- parent companies 0 0
- other 0 0
Subtotal 16a) 292,062 245,645
b) from securities recorded as fi xed assets 0 0
c) from securities recorded as current assets
d) other fi nancial income
0 0
- from subsidiaries 0 0
- from associated companies 0 0
- from parent companies 0 0
- exchange gains 0 0
- other 561,176 807,672
Subtotal 16d) 561,176 807,672
Total other fi nancial income
17 Interest and other fi nancial charges
853,238 1,053,316
a) from subsidiaries 22,623 24,644
b) from associated companies 0 0
c) from parent companies 0 0
d) exchange losses 0 0
e) interest payable 2,231,498 1,931,484
f) other 248,577 249,414
Total interest and other fi nancial charges
17 bis Gains and Losses on Exchange rate
2,502,698 2,205,54
Gains (1,465,321) (1,130,918)
losses 1,575,357 3,044,836
total (profi t) losses on excange rate (total 17 bis) 110,037 1,913,918
Total interest and other fi nancial charges (17+17 bis) 2,612,735 4,119,460
Total (15+16-17) (828,868) (3,066,143)

INCOME STATEMENT - MARCOLIN S.p.A.
Marcolin S.p.A.
31.12.2004 31.12.2003
D) Adjustments to the value of fi nancial operations
18 Revaluation:
a) investments in share capital 1,302,646 0
b) other investments 0 0
c) securities recorded as current assets 186,593 0
Total revaluation
19 Write-down of
1,489,239 0
a) investments in share capital 6,700,000 11,099,027
b) other investments 0 0
c) securities recorded as current assets 0 17,025
Total write down 6,700,000 11,116,052
Total adjustments (18-19)
E) Extraordinary income and expenses
20 Income
(5,210,761) (11,116,052)
a) capital gains on disposal of assets 0 0
b) other extraordinary income 2,295,032 386,176
Total extraordinary income
21 Expenses
2,295,032 386,176
a) losses on disposal of assets 0 0
b) taxes relating to previous periods 803,900 485,755
c) other extraordinary charges 98,056 217,981
Total extraordinary expenses 901,956 703,736
Total extraordinary items (20 - 21) 1,393,077 (317,560)
Profi t (loss) before taxes (A-B±C±D±E) 6,315,319 (6,935,333)
22 Income taxes for the period 0 0
Current taxes 3,753,628 1,983,388
Deferred taxes 120,830 0
Advanced taxes 786,408 (2,770,765)
Net profi t gross of third parties quota 1,654,453 (6,147,956)
Result atributable to minority interests 0 0
Profi t (loss) for the PERIOD 1,654,453 (6,147,956)
89

90
Statutory Annual Report & Accounts
EXPLANATORY NOTES TO STATUTORY ACCOUNTS
FOR THE YEAR ENDING ON DECEMBER 31 31ST ST 2004

General approach to preparation
Marcolin S.p.A.
The statutory report and accounts for the year ending on December 31st 2004 have been prepared in compliance
with the regulations of the Italian Civil Code, as amended following introduction of the company law reform
pursuant to Italian Legislative Decree no. 6 of January 17th 2003 and its subsequent amendments. Accounts
consist of the balance sheet, income statement, and of these explanatory notes.
In order to aid their comparability with the previous FY, fi gures as at December 31st 2003 have been classifi ed so
as to align them with the new regulations, which have partly modifi ed the templates for income statements and
balance sheets.
The purpose of Explanatory Notes is to illustrate, analyse and supplement data in year-end fi nancial statements.
They contain the information required by Article 2427 of the Italian Civil Code, by other provisions of Italian
Legislative Decree 127/1991, and by other previous Italian laws.
In preparing comments to fi nancial statements we have taken into account the provisions of Italian Legislative
Decree no. 58 of February 24th 1998 and of CONSOB Regulation no. 11971 dated May 14th 1999 and its subsequent
amendments and additions.
In order to provide better representation of fi nancial status a cash fl ow statement is presented as an attachment
to these notes.
We point out that a consolidated report and accounts have been prepared and are presented together with the
statutory report and accounts, as envisaged by Italian Legislative Decree 127/1991.
We also point out that the report on operating performance provides information concerning the nature of our
business, signifi cant events occurring after year-end, and transactions with subsidiary/associated/parent companies,
together with information concerning the various geographical areas and business sectors.
Accounting policies
Accounting standards and policies adopted by the company for preparation of year-end fi nancial statements as
at December 31st 2004 are those envisaged by current civil legislation as well as by the documents prepared by
the Italian Joint Commission of Chartered & Registered accounts, by the guidelines provided by the independent
Italian Accounting Association (Organismo Italiano di Contabilità - OIC, a standard setter) concerning accounting
standards, and, in the absence of all these, by those of the International Accounting Standards Board (IASB) taking
into account possible tax impact on items posted in accounts.
Accounting policies applied are the same as those applied in the previous FY, saving changes indicated under the
heading “Changes in accounting policies”.
Financial statements have been drawn up clearly and truthfully and properly represent the company’s capital and
fi nancial status and the year’s business result.
Further indications are provided in the notes commenting on individual items in accounts.
Items in fi nancial statements have been quantifi ed based on the general criteria of prudence and temporal
applicability, with a view to continuation of business.
Application of the principle of prudence has involved individual valuation of elements forming the individual
sub-items or items of assets and liabilities, in order to avoid offsetting between losses that should be recognised in
accounts and profi ts that instead should not be recognised since they have not yet been realised.
In observance of the principle of temporal applicability (accrual accounting), the effect of transactions and other
events has been posted in accounts and attributed to the period to which such transactions and events refer , and
not to the period when related cash movements occur (collections and payments).
Continuity over time of accounting policies’ application is essential to assure comparability of the company’s
fi nancial statements in the various FYs.
More specifi cally, the most signifi cant accounting policies used to prepare year-end fi nancial statements are as
described below.
Intangible fi xed assets
These assets are booked at historical acquisition cost, inclusive of any accessory costs, and directly amortised on a
straight-line basis according to their residual possibility of utilisation.
If, regardless of accrued amortisation already posted, permanent impairment of value emerges, the net fi xed asset
value is written down accordingly. If in subsequent FYs the reasons for write-down cease to exist, the original
value is written back.
91

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Statutory Annual Report & Accounts
Start-up & expansion costs and the costs of research, development and advertising featuring multiannual utility
posted among assets are amortised in a 5-year period.
Rights for industrial parents and for use of intellectual properties are amortised according to projected useful
business life - on a 5-year basis - starting from the time when the process of business utilisation commences.
Costs relating to concessions, licenses, trademarks and similar rights are amortised according to the duration of
the contracts stipulated for them.
Tangible fi xed assets
These assets are booked at purchase or construction cost (inclusive of the portion of industrial expenses directly
or indirectly attributable to them), taking into account any legal monetary revaluations, and depleted by their
respective cumulative depreciation.
Their book value also takes into account accessory costs, reducing cost by any discounts accorded.
Routine maintenance and repair costs are fully expensed in the profi t & loss account. Maintenance costs increasing
asset value are attributed to the assets to which they refer and undergo depreciation according to the latter’s
residual possibility of utilisation.
Annual depreciation amounts, charged to the profi t & loss account, have been calculated taking into account
the assets’ utilisation, category and economic/technical duration, based on the criterion of residual possibility of
utilisation.
In the year when the asset is acquired, annual depreciation is forfeitarily halved, in the belief that this is a reasonable
approximation of the timing of purchases during the FY.
If their usefulness ends within the FY, assets featuring a unitary cost of up to € 516,46, capable of stand-alone
utilisation, are fully expensed in the profi t & loss account, in item B.6.
If, regardless of depreciation already posted, permanent impairment of value emerges, the fi xed asset’s net residual
value is written down accordingly. If in future years the reasons for write-down cease to exist, the asset is written
back to its original value.
The depreciation rates used - the same as those used in the previous FY - are as follows:
CATEGORY Rate
Buildings 3.0%
Non-operating machines 10.0%
Depreciable equipment 40.0%
Operating machines 15.5%
Furniture & fi ttings 12.0%
Booths furniture 27.0%
Electronic machines 20.0%
Vehicles 25.0%
Trucks 20.0%
Assets under construction and advance payments to suppliers are posted among assets according to cost borne
inclusive of directly ascribable expenses.
Financial fi xed assets
Equity investments in subsidiary and associated companies
Equity investments - if they are permanent or long-lasting investments - are posted among fi xed fi nancial assets.
Otherwise - i.e. if purchased for subsequent monetisation - they are posted among current assets.
Equity investments are accounted for using the cost method.
Their book value is determined on the basis of purchase price, inclusive of any accessory costs, or subscription
price. The cost is reduced in the case of permanent losses of value. The original value is written back in subsequent
FYs if the reasons for write-down cease to exist.

Non-current receivables
Receivables included in fi xed fi nancial assets are posted according to their presumable realisation value.
Marcolin S.p.A.
Non-current securities
Non-current securities are posted at purchase cost. If, at year-end date, they feature a permanently lower value than
the value originally booked, the fi gure is aligned with this lower value.
Inventories
Inventories are quantifi ed at the lowest between average purchase or production cost and corresponding
presumable disposal value, based on market trends. Purchase cost is determined by applying the weighted average
cost method. Production cost includes the cost of raw materials, labour components, and all other direct and
indirect production costs.
“Presumable disposal value” means market value existing on year-end date. It is calculated taking into account any
fabrication costs still to be borne and direct selling costs. More specifi cally, in addition we consider price trends
and all other conditions having an infl uence also in the interval between year-end date and the date of preparation
of year-end accounts.
In determining purchase cost, we have taken into account the price effectively borne, inclusive of directly
attributable expenses, including freight costs and customs costs, net of trade discounts.
In production cost, besides the cost of materials used, as defi ned above, we have also considered direct and
indirect manufacturing costs.
Obsolete or slow-moving inventory items have been written down according to their possibility of utilisation
or disposal.
Receivables
Receivables are shown at their presumable realisation value, which is the difference between their face value and
prudently calculated doubtful-debt provision.
As regards the value of trade receivables posted in the company’s year-end fi nancial statements, we point out
- as recommended in CONSOB memorandum no. 97003369 of April 9th 1997 - that during the FY the company
monetised part of its trade receivables, for an amount of some € 7,041k, via completion of some no-recourse
factoring transactions with premier factoring companies. We note that factored receivables do not included
amounts not yet falling due as at December 31st 2004.
From the accounting standpoint, we removed the value of the receivables factored, posting in the profi t &
loss account the difference between cash-in received from the factoring company and the book value of the
receivables concerned.
We advise that, as at the end of FY2004, the aforementioned factoring transactions had been totally concluded.
Current fi nancial assets
Current fi nancial assets are quantifi ed at the lowest between purchase and presumable realisation value based on
market trends. If in subsequent years the reasons for any write-downs cease to exist, book value is written back to
market value up to the limit of the original cost.
Cash & banks
Cash & banks as at year-end are shown at their nominal value.
Accruals and deferrals
These items comprise the portion of costs and income common to two or more FYs that pertains to the FY
in questions, as envisaged by the Italian Civil Code, in order to respect the principle of temporal applicability
(accrual accounting).
Accruals for risks and contingencies
Accruals for risks and contingencies are made to cover losses or debts, materialisation of which is certain or likely
- but whose entity or date of occurrence cannot be accurately determined at year-end.
Provisioning refl ects the best possible estimate based on information to hand.
Valuation of accruals complies with the general criteria of prudence and applicability and no generic risk accruals
without any business justifi cation have been made.
93

94
Statutory Annual Report & Accounts
Risks, for which materialisation of a liability is merely possible, are described in the explanatory notes to account
without making provision.
The item also includes the value of deferred taxes calculated according to the approach described in the paragraph
called “Income tax in the year”.
Accruals for employee severance indemnities
Accruals correspond to the total amount of sums accruing in employees’ favour in compliance with legal results
and the current national and supplementary company collective labour contracts, taking into account all forms of
remuneration of a continuous nature.
Cumulative accrual is the total of individual indemnities accruing in employees’ favour as up to year-end date, net
of any payments on account made. It therefore represents the amount that would have to be paid to employees if
their employment relationship were to cease on that date.
Total accrual is revalued each year according to the trend in the ISTAT (Italian national statistics bureau) consumer
price index for the families of blue- and white-collar workers.
Payables
Payables are shown at their face value.
Guarantees and commitments
These items represent the company’s positions of commitment, guarantee or commitment that it has not been
possible to represent appropriately in balance-sheet assets and liabilities.
They are shown at their nominal or contractual value.
Revenues and income, costs and charges
Revenues and costs are posted in the profi t & loss account on the basis of temporal applicability, also posting
related accruals and deferrals, and observing the principle of prudency and pertinence.
Revenues and income and costs and charges are posted net of returned goods, discounts, credits and bonuses, as
well as of taxes directly connected with the sale of products and provision of services.
Revenues for the sale of products are recognised upon transfer of ownership, which generally coincides with
delivery or shipment. In the case of services, recognition of revenues coincides with completion of execution
of services.
Dividend income is posted in accounts on a cash basis.
Income tax in the year
Taxes are posted based on determination of taxable income in compliance with current regulations, taking
applicable exemptions and tax credits into account. When necessary, deferred taxes are provisioned for temporary
differences between the year’s reported net result and taxable income.
As required by Article 2427, paragraph 1, no. 14), of the Italian Civil Code, explanatory notes show a specifi c table
containing:
• The description of temporary differences leading to the posting of deferred and prepaid taxes, specifying
the tax rate applied, changes versus the previous FY, amounts credited and debited to the profi t & loss
account or to net shareholders’ equity, and items excluded from the calculation and the reasons for
exclusion.
• The amount of prepaid taxes posted in accounts relating to losses made in the year or in previous year
and the reasons for such entries and the amount not yet posted in accounts, together with the reasons
for non-entry.
In particular, as regards provision of deferred tax assets for accrued tax losses, we point out that these are
posted only:
• If there is a reasonable certainty of achieving in future (normally within the next fi ve FYs) taxable
income of an entity able to absorb the losses carried forward, and
• the accrued losses are attributable to specifi c circumstances that it is believed will not be repeated
in future.

Marcolin S.p.A.
Derivative contracts
In order to address the risk of changes in exchange and interest rates, the company stipulates derivative contracts
hedging specifi c transactions or net exposures.
For fi nancial instruments used to manage interest-rate risk, interest differentials are posted in the profi t & loss
account, among “Financial income and charges”, according to the principle of temporal applicability.
For fi nancial instruments used to manage exchange-rate risks, the cost (or “fi nancial component”, calculated as
the difference between the spot exchange rate on the date of contract stipulation and the forward exchange rate)
is charged to the profi t & loss account among “Financial income and charges”, once again according to the rule
of temporal applicability.
Assets acquired via fi nancial leasing contracts
Capital goods acquired via fi nancial leasing contracts are accounted as per the accounting treatment consistent
with current relevant legislative interpretations. This accounting method involves posting of leasing costs among
operating costs (among “Rental, leasing and royalties”) and posting of the asset among balance-sheet assets in the
FY when the redemption right is exercised. During the leasing period the value of residual instalments is shown
in memorandum accounts.
If we had adopted the fi nancial method for accounting treatment of the contracts in question, this would have
involved posting in the profi t & loss account of interest on the principal fi nanced and of annual depreciation of the
value of assets acquired via fi nancial leasing, as well as posting of the goods themselves among assets and residual
debt among liabilities in the balance sheet.
The information required by point 22 of Article 2427 of the Italian Civil Code is provided in a specifi c table
attached to these explanatory notes.
Changes in accounting policies
Elimination of tax interference
In application of the regulatory changes introduced by Italian Legislative Degree no. 6 and its subsequent
amendments and additions (Company Law Reform), and taking into account the recent guidelines provided by
the institutions and authorities concerned, we have proceeded with elimination of “tax interferences” relating to
provisions and write-downs made in previous FYs justifi ed solely by tax reasons. The new provisions in fact no
longer permit the posting in accounts of write-downs or provisions solely for the application of tax regulations.
In FY2004 we therefore eliminated the so-called “prior contamination” from fi gures in fi nancial statements as at
January 1st 2004, reversing depreciation provision pertinent solely for tax purposes made in previous FYs.
According to the orientation of the CONSOB, the Bank of Italy, and of the Italian Accounting Association, reversal
of write-downs made solely for application of tax regulations is posted among extraordinary income items, whilst
related taxes are posted among extraordinary charges.
The effects of this “tax decontamination” are detailed in the comments concerning “Tangible fi xed assets”.
Policies for translation of foreign-currency items
Consistently with the requirements of Article 2426, no. 8/2, of the Italian Civil Code and in contrast with what was
done in previous FYS - when foreign-currency receivables and payables falling due after more than 12 months
were accounted for by (a) refl ecting losses in the year’s profi t & loss account and (b) prudently deferring gains via
provisioning of a specifi c accrual for deferred gains - all monetary assets and liabilities denominated in foreign
currency are now posted at the exchange rate in force on the transaction date and adjusted to the exchange rate
in force at year-end date, taking into account any derivative hedging contracts. Unrealised positive or negative
differences stemming form adjustment of these items to year-end exchange rates are posted in the profi t & loss
account and any net foreign-exchange gain is provisioned in a specifi c reserve that cannot be distributed until
realisation. If the company had applied the same policy as that applied in the previous FY, there would have been
no signifi cant differences in net profi t and net shareholders’ equity.
A new item has been included in the profi t & loss account - i.e. Foreign-exchange gains/(losses) - as per the
provisions of Article 2425, point 17/2 of the Italian Civil Code.
In order to permit proper comparison between fi gures for FY 2004 and those of the previous FY, FY2003 amounts
relating to positive and negative exchange-rate differences - respectively included in the items “Other fi nancial
income” and “Interest and other fi nancial expenses - have been reclassifi ed in the item “Foreign-exchange
gains/(losses)”.
95

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Statutory Annual Report & Accounts
We note that there have been no signifi cant changes in exchange rates since the year-end date.
Comparability of items
The reform of rules governing joint-stock companies introduced by Italian Legislative Decree no. 6 of January
17th 2003 and its subsequent amendments has caused signifi cant modifi cations to the structure and content of the
balance sheet and profi t & loss account.
For companies whose fi nancial year coincides with the calendar year, the new rules are applicable as
from FY2004.
The amendments and additions made to year-end account templates are as follows:
• Introduction of the items C.II.4/2) and C.II.4/3) respectively for “Tax receivables” and “Prepaid taxes”;
• Inversion of numbering for the Statutory Reserve and Treasury Stock Reserve, respectively numbered
A.V and A.VI as from 2004;
• Introduction of the item D.3 - “Amounts payable to shareholders for loans”;
• Introduction of the item C.17/2) - “Foreign-exchange gains/(losses)”;
• Addition to the item 22) - Income taxes in the year - of the specifi cation “current, deferred,
and prepaid”.
In order to assure comparability, as envisaged by Article 2423/3 of the Italian Civil Code, the corresponding items
in the previous year have also been reclassifi ed, as illustrated below (in € units):
Old Scheme New Scheme
(Euro/thousand)
CII5) Other receivables 6,698,456 CII4-bis) Receivables from tax authorities 677,287
CII4-ter) Accrued Taxes 5,587,176
CII5) Other receivables 433,993
D4) Other fi nancing payables 575,880 D3) Payable to Shareholders for fi nancing 0
D5) Other fi nancing payables 575,880
C16d) Other fi nancial income 1,938,590 C16d) Other fi nancial income 807,672
C17-bis) Gains and Losses on exchange rate 1,130,918
C17) Interests and other fi nancial charges 5,250,378 C17) Interests and other fi nancial expenses 2,205,542
C17-bis) Gains and Losses on exchange rate 3,044,836
Cash fl ow statement
The Cash Flow Statement shows cash fl ows by type, considering in the NFP (net fi nancial position) cash, bank
receivables and payables, other fi nancial debts, and readily monetisable securities.

ILLUSTRATION OF THE MAIN ITEMS
OF STATUTORY FINANCIAL STATEMENTS
ASSETS
A) Share capital issued and not paid
No fi gures are booked for this item.
B) Fixed assets
Marcolin S.p.A.
No write-downs of intangible and tangible fi xed assets have been made for permanent losses of value.
As regards information required by Article 2427, no. 2, of the Italian Civil Code, reference should be made to the
tables attached to these Notes.
I. Intangible fi xed assets
The balance as at 31.12.2004 amounted to € 3,423k vs. € 1,986k as at 31.12.2003.
Some € 1,399k of the increase in assets under construction and advance payments related to costs borne for the
new ERP system. This project, which started at the end of October 2003 and was still undergoing implementation
at the end of December 2004, was completed at the beginning of 2005.
The remaining increase of some € 560k in intangible fi xed assets was due to renewal of the license for utilisation
of the technical drawing system (about € 300k) and to contribution to equipment expenses (about € 224k).
Decreases in the various items were solely due to the year’s amortisation.
In year-end fi nancial statements as at 31.12.2004 there has been no reclassifi cation of items forming intangible
fi xed assets.
Below we indicate the composition of the items “Start-up and expansion costs” and “Research, development and
advertising costs” booked among fi xed assets. There were no increases during the FY in question.
Start-up & expansion costs
Description Value as at
31.12.2003
Clearance of the item means elimination of the constraints on dividend distribution envisaged by Article 2426,
no. 5, of the Italian Civil Code.
Research & development and advertising costs
Increases Decreases Depreciation Value as at
31.12.2004
Listing expenses 189 - - 189 -
Total 189 - - 189 -
Description Value as at Increases Decreases Depreciation Value as at
31.12.2003 31.12.2004
Multi-year advertising 2 - 2 - -
Total 2 - 2 - -
During the year the company incurred “ordinary” advertising costs that were totally expensed in the profi t &
loss account.
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II. Tangible fi xed assets
These assets showed a balance of € 5,896k as at 31.12.2004 vs. € 4,268k as at 31.12.2003.
As regards changes occurring during FY2004, reference should be made to the table attached to these Notes.
In application of the regulatory changes introduced by Italian Legislative Decree no. 6 of January 17th 2003 and
its subsequent amendments and additions (Company Law Reform), we eliminated - offsetting it in extraordinary
income - tax interference concerning provisions made for accelerated depreciation (€ 2,065k) in previous years and
justifi ed solely by tax motivations. Related deferred-tax provision has been offset among extraordinary charges.
The amount of this “decontamination” is shown, detailed by each fi xed asset category, in a specifi c line in the table
mentioned above showing changes in tangible fi xed assets.
The main increases in tangible fi xed assets referred to:
• Industrial equipment for the construction of moulds mainly for the production of new eyewear ranges
(about € 972k); replacement of production machinery (about € 147k); other assets for the purchase of
furniture and fi ttings to set up trade show stands (about € 277k) and of offi ce furniture and furnishings
(about € 29k); purchase of electronic machines (about € 95k); and other fi xed assets (€ 16k).
• Assets under construction and advance payments totalling some € 30k.
The book value of tangible fi xed assets shown in accounts is net of depreciation applied in the FY.
In addition, the company has at its disposal assets stemming from signature, in previous FYs, of fi nancial leasing
contracts that have been posted based on the capital method. This involves posting of instalments charged by
the lessor company in the item b.8 - Rental, leasing, and royalties - of the profi t & loss account. As regards
information required by Article 2427, no. 22, of the Italian Civil Code, reference should be made to the table
attached to these Notes.
Total revaluations of tangible fi xed assets as at year-end
Pursuant to Article 10 of Law 72/1983 and of Law 413/1991, we list the following tangible fi xed assets present
in the company’s year-end fi nancial statements as at December 31st 2004 and that have undergone monetary
revaluation.
Description Revaluation Revaluation Total revaluations
law 413/91 law 72/83
Land and Buildings 26,301 26,301
Plant and Machinery 22,093 22,093
Total 26,301 22,093 48,394
The aforementioned tangible fi xed assets have been revalued according to legislative provisions (special, general,
or sector) within the maximum limit consisting of the fi xed assets’ objectively determined use value. We have not
undertaken any discretionary or voluntary revaluations.

III. Financial fi xed assets
Marcolin S.p.A.
Equity investments
As at 31.12.2004 the balance of equity investments amounted to some € 23,543k as compared with some € 28,941k
as at 31.12.2003.
Description Value as at Increases Decreases Value as at
31.12.2003 31.12.2004
Subsidiaries 28,682,373 1,302,646 6,700,000 23,285,019
Associated companies
Parent companies
258,228 258,228
Other companies - - - -
Total 28,940,602 1,302,646 6,700,000 23,543,248
The total decrease of € 5,397k was the result of the combined effect of:
• Write-back, within the limit of their original cost, of the book value of the equity interests owned in the
subsidiaries Marcolin U.K. Ltd. and Marcolin Iberica S.A. - previously written down due to permanent
impairment of value - by some € 1,302k, due to cessation of the reasons that had caused directors to
reduce their respective cost value.
• Write-down, for a total of some € 6,700k, of the book value of equity interests owned in the subsidiaries
Marcolin do Brasil Ltda., Marcolin Deutschland GmbH, Marcolin France S.a.r.l., and Marcolin U.S.A. Inc.
due to permanent impairment of value.
For further details reference should be made to the comments on the item “Adjustment to value of fi nancial assets”.
Equity investments in subsidiary and associated companies are valued, observing the principle of continuity of
accounting policies, at purchase or subscription cost, written down for permanent impairment of value or written
back following cessation of the reasons causing past write-down of the equity investment concerned.
For the list of equity investments, reference should be made to the table attached to these Notes.
Receivables
Description Value as at Increases Decreases Value as at
31.12.2003 31.12.2004
Subsidiaries 8,344,351 4,283,456 - 12,627,807
Associated companies - - - -
Parent companies -
Other companies 99,064 997 64,195 35,866
Total 8,443,415 4,284,453 64,195 12,663,673
Amounts receivable from subsidiaries were of a fi nancial nature and related to the Swiss affi liate (some € 2,268k),
Cébé S.A. (about € 6,210k), and Marcolin International B.V. (about € 4,150k).
Other securities
As at December 31st 2004 the company did not own securities booked as fi xed fi nancial assets.
Treasury stock
The company does not hold any of its own shares booked as fi xed fi nancial assets.
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Statutory Annual Report & Accounts
C) Current assets
I. Inventory
The balance of inventories as at December 31st 2004 totalled about € 25,832k vs. some € 26,912k as at
December 31st 2003.
The decrease of some € 1,080k was due to tighter and more rational inventory management.
Details show a decrease in inventories of fi nished products of some € 1,167k and of raw and ancillary materials and
consumables of about € 347k, together an increase in work-in-process inventory of some € 434k.
Quantifi cation, respectively, on the basis of (a) weighted average cost for raw and ancillary materials and (b)
average production cost for fi nished products does not differ signifi cantly from inventory quantifi cation based on
current costs.
In addition, we point out that at 2004 year-end we aligned the value of slow-moving inventory with market value
via inventory write-down accruals, the total amount of which was approximately € 3,267k.
As regards inventory value, no fi nancial charges have been included.
II. Receivables
There were no receivables relating to transactions with the obligation of forward repurchase (repos).
Below we show the balance split by geographical area and due date.
RECEIVABLES BY GEOGRAPHICAL AREA
Italy Rest of Europe Rest of the world Total
Trade receivables 27,065,991 2,719,236 3,741,929 33,527,155
Due from subsidiaries 15,211 7,602,329 12,850,155 20,467,696
Due from associated companies 0 0
Due from parent companies 0 0
Due from tax authorities 0 0
Accrued taxes 4,750,455 4,750,455
Due from others 362,178 362,178
Total 32,193,835 10,321,565 16,592,084 59,107,484
RECEIVABLES - MATURITY ANALYSIS
Within one year After one year
and within 5 years
After 5 years Total
Trade receivables 33,527,155 33,527,155
Due from subsidiaries 20,467,696 20,467,696
Due from associated companies 0 0
Due from parent companies 0 0
Due from tax authorities 0 0
Accrued taxes 2,435,474 2,314,981 4,750,455
Due from others 362,178 362,178
Total 56,792,503 2,314,981 0 59,107,484

Marcolin S.p.A.
RECEIVABLES FROM SUBSIDIARIES
Company 31.12.2004 31.12.2003
Marcolin & Co. S.p.A. 15,211 6,869
Marcolin France S.a.r.l. 1,471,234 1,847,918
Marcolin (Deutschland) GmbH 1,614,246 1,848,822
Marcolin (U.K.) Ltd. 511,714 816,792
Marcolin Iberica S.A. 1,499,732 1,714,332
Marcolin GmbH 742,374 319,622
Marcolin Portugal Lda. 902,575 975,281
Marcolin Benelux S.p.r.l. 783,176 763,341
Marcolin U.S.A. Inc. 10,296,233 10,713,487
Marcolin Intern. B.V. 283,259 153,241
Marcolin do Brasil Ltda. 1,804,225 1,413,956
Marcolin Asia Ltd. 7,324 186,057
Cébé S.A. 536,394 2,263,387
Total 20,467,696 23,023,103
The total balance of receivables increased by some € 6,906k YoY. Going into greater detail, we note an increase in
third-party trade receivables (about € 11,047k) - relating to the higher sales achieved in the domestic market where
terms of payment are longer than those of the international market - and a decrease of some € 2,555k in amounts
receivable from subsidiaries.
As specifi ed in the comment on the policies adopted for receivables’ valuation, we point out that, during the FY,
the company undertook no-recourse factoring of trade receivables for an amount of some € 7,041k with premier
factoring companies, in order to optimise working capital management, also in the light of the favourable rates
conditions obtained. All receivables factored during 2004 had fallen due as at FY year-end date.
We point out that, at year-end these transactions had in any case been fully concluded.
In compliance with the new requirements introduced by Italian company law reform, the company has posted as
a separate item the value of credits for prepaid taxes calculated on the basis of the temporary differences existing
between reported profi t and taxable income. As envisaged by Article 2427, no. 14, of the Italian Civil Code, the
attachments include a specifi c table indicating the aforesaid temporary differences and the amount of prepaid taxes
posted in year-end accounts. The company has not provisioned prepaid taxes relating to losses made in the FY or
in previous FYs. The tax rate applied for calculations is 33% for corporate income tax (Italian acronym = IRES)
and 4.25% for regional business tax (Italian acronym = IRAP).
Contrary to the situation of the previous FY, the balance of tax receivables and payables in FY2004 showed a debt.
The relevant net fi gure has therefore been posted in “Taxes payable”
Amounts receivable from other parties, totalling some € 362k, consisted of the following items:
Description
31.12.2004 31.12.2003
Security deposits 112,579 83,749
Other receivables 249,600 350,244
Total 362,178 433,993
The sub-item “Other receivables” included the value of a credit concerning a grant of some € 107k, obtained
against presentation of a project for the study and development of new technologies applicable to the alpine
goggles and eyewear segment, and payments on account to suppliers of some € 50k.
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Trade receivables are shown at their presumable realisation value, adjusted by doubtful-debt provision - not deductible
for tax purposes (under Article 106 of Italian Presidential Decree 917/1986) - of some € 1,055k and by tax-deductible
provision of some € 278k. We consider these provisions adequate for coverage of estimated credit risks.
Accrued doubtful-debt provision underwent the following changes during FY2004:
RESERVE FOR DOUBTFUL ACCOUNT Non-deductible Tax-deductible Total
(Euro/thousand) reserve reserve
Balance at 31.12.2004 801,480 232,189 1,033,669
Utilization in the period (168,179.37) (232,189.14) (400,368.51)
Reclassifi cations - -
Accrual for the period 421,727 278,273 700,000
Balance at 31.12.2003 1,055,027 278,273 1,333,301
In order to adjust receivables to their presumable realisation value, we made total provision of some € 700k.
We note that receivables also included foreign-currency balances. More specifi cally, some € 13,7 mn related to
transactions with the U.S. affi liate and CHF 3,5 mn to amounts receivable from the Swiss affi liate.
III Current fi nancial assets
As at December 31st 2004 the company hold 681,000 of its own shares as current fi nancial assets for a total nominal
value of € 354,120. The amount shown in year-end accounts includes write-back, within the limit of original cost,
of some € 187k posted during FY2004 in order to align book value with the stock’s market prices.
IV. Cash & banks
CASH & BANKS
(Euro/thousand) 31.12.2004 31.12.2003
Bank and postal accounts 3,218,237 7,201,738
Checks 613 5,471
Petty cash 6,890 11,669
Total 3,225,740 7,218,878
The balance represents cash & bank balances as at year-end date.

D) Accrued income & prepayments
Marcolin S.p.A.
Accrued income and prepayments included income relating to the period collectable in subsequent FYs and costs
borne by year-end date but relating so subsequent FYs.
The breakdown of the item was as detailed below:
ACCRUED INCOME AND PREPAYMENTS
31.12.2004 31.12.2003
Accrued income:
- Lease commitments - -
- Interest income - -
- Other 20,355 21,992
TOTAL ACCRUED INCOME 20,355 21,992
Prepayments:
- Lease payments 15,930 89,996
- Insurance premiums - -
- Discounts, premiums and other costs for granting
loans and obtaining fi nancing
- -
- Other 543,224 859,729
TOTAL PREPAYMENTS 559,155 949,725
Total Accrued Income and Prepayments 579,510 971,716
The sub-item “Other prepayments” comprises - for an amount of some € 206k - the portion pertaining to future
years of an exceptional one-off payment paid in previous years to Dolce & Gabbana S.p.A. and the prepayment
value - for an amount of some € 181k - of costs incurred for acquisition of a new licenses, which have been spread
over contract duration.
103

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LIABILITIES
A) Shareholders’ Equity
In the following table we show the information required by Article 2427, no. 7/2, of the Italian Civil Code:
SHAREHOLDERS’ EQUITY COMPOSITION Previous years allocations
Description Value Possible
Available
Losses Other reasons
utilization
reserve
coverage
Equity
Equity reserve:
23,596,560
Share premium reserve 21,950,034 A-B-C 18,850,893
Treasury stock reserve
Consolidation surplus
Split surplus
Other reserve
Profi t reserve:
946,589 0
Revaluation reserve 0
Legal reserve 1,620,170 B 0
Statutory reserve
Treasury stock reserve
0
Extraordinary reserve
Consolidation surplus
Split surplus
0
Euro rounding reserve
Other reserve
0
Profi t (losses) carried forward 3,997,980 A-B-C 3,997,980 6,147,956 1,224,675
Total 52,111,333 22,848,872 6,147,956 1,224,675
Amount not to be distributed ex art. 2426, comma 1 n. 5 c.c. 0
Amount not to be distributed ex art. 2431 c.c. 3,099,142
Residual amount which can be distributed 19,749,730
Bound amount ex art. 109 comma 4 lettera b) del T.U.I.R. 1,363,169
Legenda: A - to capital increase; B - to losses coverage; C - to shareholders’ distribution; D - other.
Shareholders’ equity as at 31.12.2004 showed a balance of approximately € 53,766k vs. some € 52,111k as at
31.12.2003.
As regards changes occurring during the FY, reference should be made to the table included in attachments.
Share capital as at 31.12.2004 consisted of 45,378,000 ordinary shares of a nominal value of € 0,52 each for a total
amount of € 23,596,560.00.
The Treasury stock reserve relates to buy-back of Marcolin shares and is posted in accordance with the rules
established by the Italian Civil Code.
The fi gure indicated for the item “Portion constrained pursuant to Article 109, paragraph 4, letter b), of the Italian
Consolidated Finance Act” shown in the table, signals that, pursuant to the regulation highlighted, an indistinct
part of reserves other than the Legal Reserve posted as part of shareholders’ equity is subject to a tax constraint
envisaging that:
“... In the eventuality of their distribution, shareholder equity’s reserves and earnings, even if achieved after the
tax period to which the deduction refers, go to form [taxable] income if, and to the extent that, the amount of
remaining shareholder equity’s reserves, other than the Legal Reserve, and of retained earnings is lower than
depreciation, write-downs and provisions deducted in excess of those posted in the profi t & loss account net of
deferred-tax provision relating to the amounts deducted...”.
The amount indicated corresponds to the amount of depreciation posted in previous FYs solely for tax reasons
(so-called “accelerated depreciated”) net of related deferred taxes.

B) Accrued provisions for risks and contingencies
Marcolin S.p.A.
Description Value as at Increases Decreases Value as at
31.12.2003 31.12.2004
Severance indemnities and other commitments 575,707 174,681 18,866 731,522
Deferred tax 68,801 870,787 28,877 910,711
Others 1,023,004 615,414 348,834 1,289,584
Total 1,667,511 1,660,882 396,577 2,931,817
“Provisions for retirement benefi ts” refers to provision accruing for agent indemnities.
The “Other provisions” item include estimated risk provision of some € 606k posted to take into account markedto-market
valuation of some interest-rate and USD hedging transactions still in place at year-end, relating to loan
transactions. It also included provision of some € 400k for returned goods and product warranties; provision for
litigation risks of some € 192k; and provision for deferred foreign-exchange gains of about € 18k. Some € 911k of
accrued tax provision referred to deferred taxes.
Increases related to provisions made in the year for:
• Litigation risks = € 142k, based on the development lawsuits underway;
• Potential risks = € 400k, for risks concerning returned goods;
• Potential risks = € 73k, for prizes to be awarded for competitions;
• Agent termination = some € 175k, as per the rules established by the national collective agent contract
(Italian acronym = AEC) and in compliance with civil legislation.
Decreases related to utilisation of provisions in the year.
C) Accruals for employee severance indemnities
Description Value as at Increases Decreases Value as at
31.12.2003 31.12.2004
Staff Leaving Indemnity 4,373,910 873,245 666,381 4,580,774
Total 4,373,910 873,245 666,381 4,580,774
The total amount accrued represented the company’s effective debt as at 31.12.04 to employees on the payroll on
that date, net of advances paid out.
There was an increase and decrease during the FY of about € 873k and € 666k respectively.
D) Payables
The balance of payables as at December 31st 2004 amounted to some € 73,323 vs. about € 73,016k as at
December 31st 2003. The breakdown of the amount by geographical area and duration was as shown in the
following tables.
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PAYABLES BY GEOGRAPHICAL AREA
Italy Rest of Europe Rest of the world Total
Bonds 0 0 0 0
Convertible Bonds 0 0 0 0
Payable to Shareholders for fi nancing 0 0 0 0
Due to banks 43,754,961 0 0 43,754,961
Due to others fi nanciers 793,171 0 0 793,171
Advances 0 0 0 0
Trade payables 17,461,034 374,281 2,716,565 20,551,879
Notes payables 0 0 0 0
Due to subsidiaries 558,850 793,107 536,451 1,888,408
Due to associated companies 1,117,161 0 0 1,117,161
Due to parent companies 0 0 0 0
Taxes payable 2,604,120 0 0 2,604,120
Social security payables 806,739 0 0 806,739
Other payables 1,806,258 0 0 1,806,258
Total 68,902,294 1,167,387 3,253,016 73,322,697
PAYABLES - MATURITY ANALYSIS
Within one year After one year
and within 5 years
There were no amounts posted in year-end accounts for loans received from shareholders.
After 5 years Total
31.12.2004
Bonds 0 0 0 0
Convertible Bonds 0 0 0 0
Payable to Shareholders for fi nancing 0 0 0 0
Due to banks 13,982,096 29,772,865 0 43,754,961
Due to others fi nanciers 0 793,171 793,171
Advances 0 0 0 0
Trade payables 20,551,879 0 0 20,551,879
Notes payables 0 0 0 0
Due to subsidiaries 1,888,408 0 0 1,888,408
Due to associated companies 1,117,161 0 0 1,117,161
Due to parent companies 0 0 0 0
Taxes payable 2,604,120 0 0 2,604,120
Social security payables 806,739 0 0 806,739
Other payables 1,806,258 0 0 1,806,258
Total 42,756,661 29,772,865 793,171 73,322,697
Trade payables, booked net of commercial discounts, returned goods or credits, decreased by some € 1,868k over
FY 2004 year-end.
Amounts payable to subsidiaries consisted of:
• Some € 295k for commercial accounts payable to Cébé S.A.;
• Some € 263k, once again for commercial payables, owned to Marcolin U.S.A. Inc.;
• Some € 559k of amounts payable to Marcolin & Co. S.p.A., relating to a loan falling due on 31.12.2004
(tacitly renewed for the whole of 2005) with a 4% interest rate;
• Some € 425k payable to the German affi liate;
• Some € 72k payable to Marcolin France;
• Some € 274k of amounts payable to Marcolin Asia for services performed by the subsidiary.

Marcolin S.p.A.
Amounts payable to associated companies related exclusively to Finitec Srl and were of a commercial nature.
The amount payable to banks, totalling approximately € 43,755k, consisted entirely of loan debt.
Going into greater detail, the structure of medium- and long-term debt as at December 31st 2004 was as indicated
in the following table:
BANK Currency Starting
Amount
Mediocredito
del FVG S.p.A.
Residual
Amount
USD 5,000,000 2,000,000 27.06.2006
Expiration Interest Rate Note
Efi banca S.p.A.* EUR 7,230,000 3,760,000 15.09.2006 5.05%
Interbanca S.p.A. EUR 7,000,000 3,500,000 5.01.2007
Unicredit Banca S.p.A. EUR 8,000,000 3,590,000 31.01.2007 5.31%
Unicredit Banca S.p.A. EUR 2,000,000 1,050,000 31.03.2007
San Paolo IMI S.p.A. * EUR 7,000,000 5,440,000 29.05.2008
Ministero Attività
Produttive
Efi banca S.p.A.
Unicredit Banca S.p.A.*
Ministero delle attività
produttive (Innovazione
Tecnologica)
EUR
EUR
EUR
2,000,000
granted
1,939,081
(CREDIT
LINE)
20,000,000
1,652,000
granted
793,000
1,550,000 17.12.2008 1.71%
17,000,000 11.12.2006
793,000 1.012%
Libor 6 months
+ spreed 0.8%
Euribor 6
months +1.10%
Euribor 3
months +0.8%
Euribor 6
months +0.8%
Euribor 3
months +1.5%
10 deferred instalments
(Capital Share 500,000 USD),
falling due on January 10 and
July 10. Loan instalments and rate
subject to coverage operations
Refund with half-year
instalments, from March 15, 2003,
fi nancing on BEI funds
10 half-year instalments
(capital share 700,000 euro)
from July 5,2002.
60 deferred monthly instalments
(capital share 152,108.7 euro).
10 deferred half-year instalments
(capital share 223,819.59 euro)
from September 30, 2002.
Expedited on May 29, 2003.
Refundable in 9 half-year
instalments (capital
share 777,778 euro)
from May 20, 2004.
Subsidized loan in accordance
with the Law no. 394 of July 29,
1981, refundable in 10 half-year
instalments from 06.17.2004 with
a pre-amortization instalments
“stand by” Credit Line
“revolving” type, dated
December 11, 2003. Pool-loan.
Subsidized loan in accordance
with the Law no. 46, 1982,
refundable in 10 year instalments.
* These loans envisage contractual covenants calculated on the main business and fi nancial indicators of consolidated year-end fi nancial statements.
The item “Other payables” mainly consisted of amounts owing to employees for year-end salaries, holidays not
taken, and bonuses for a total of some € 1,725k.
107

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Statutory Annual Report & Accounts
TAXES PAYABLE
Descrizione 31.12.2004 31.12.2003
IRES current year (IRPEG for 2003) 2,481,649 0
IRAP current year 1,271,979 0
Employees’ fi scal-tax withheld 510,819 0
V.A.T. 744,731 0
Independents’ fi scal-tax withheld 40,920 0
Others’ fi scal-tax withheld 1,503 0
Tax credit for tax withheld on royalties paid (552,123) 0
Tax credit for tax withheld on interest paid (5,259) 0
Advance IRAP (1,139,791) 0
Advance CFC (18,739) 0
Advance IRPEG (731,569) 0
Total 2,604,120 0
E) Accrued liabilities and deferred charges
These are the year’s adjustment accounts posted according to the principle of temporal applicability
(accrual accounting).
The breakdown of the item was as detailed below.
Description
Accrued liabilities for interest expense refer to the year’s portion of interest payable to banks for loans granted and
to the effect of interest-rate hedges.
Other liabilities include some € 33k relating to settlement of insurance premiums.
Deferred income was totally ascribable to hedging translations for some of the loans in place.
Memorandum accounts
31.12.2004 31.12.2003
Accrued Liabilities:
- Rental expense 0 0
- Interest expenses 528,475 373,326
- Royalties 0 0
- Other 34,950 74,829
Total
Deferred Charges:
563,425 448,155
- Other 52,993 85,473
Total 52,993 85,473
Total Accrued liabilities and deferred charges 616,418 533,628
COMMITMENTS AND GUARANTEES PROVIDED
31.12.2004 31.12.2003
Risks assumed
- Guarantees toward third parties 2,032,914 1,633,530
- Guarantees provided for subsidiaries 2,976,000 3,731,754
- Other guaranteees toward other companies 2,301,639 4,057,986
Company goods in third parties hands 0 0
Commitments taken from the Company 333,084 1,709,984
Total 7,643,637 11,133,254

Marcolin S.p.A.
Sureties and guarantees given to subsidiaries amounting to some € 5,278k mainly referred to Cébé and
Marcolin U.S.A. Inc. Of sureties given to third parties some € 1,731k referred to the surety given to the bank issuing
a low-rate loan under Italian Law 394. The company’s commitments concerned leasing companies (about € 333k).
Other information
We specify that, as at December 31st 2004, the group parent company Marcolin S.p.A., besides the transactions
already shown in accounts via marked-to-market valuation, had the following transactions in place:
• A forex Ko Ki forward contract for a total of USD 2 mn hedging the remaining instalments of repayment
of the loan granted by Mediocredito del Friuli Venezia Giulia S.p.A., which at year-end amounted to
some USD 2 mn.
• An IRS contract, with the underlying liability consisting of the loan of € 7 mn stipulated with
San Paolo IMI S.p.A. in May 2003 for a nominal amount of € 7 mn for conversion of the fl oating rate to a
fi xed rate upon materialisation of given conditions, with pre-defi ned cap and fl oor limits (as at year-end
the market value was negative for Marcolin by some € 5k).
The contracts were stipulated in order to reduce the underlying loans’ costs and to protect the company against
any future increases in rates and should therefore be considered to be non-speculative in nature.
INCOME STATEMENT
A) Production value
Description
Revenues from sales and services totalled some € 98,371k as at December 31st 2004, with an increase of
approximately 14.66% vs. December 31st 2003.
The breakdown of sales of products and services was as follows:
31.12.2004 31.12.2003
Sales of goods and services 98,371,342 85,793,850
Changes in work in progress & fi nished goods -731,733 2,534,971
Increase in internal construction capitalized 734,039 368,000
Other revenues 1,321,523 1,020,356
Total 99,695,172 89,717,176
Description
31.12.2004 31.12.2003
Products 97,371,842 84,556,568
Advertising Material 999,500 1,237,282
Total 98,371,342 85,793,850
109

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Statutory Annual Report & Accounts
The breakdown by geographical area of product sales - which relate to just one business category - was as follows:
AREA 31.12.2004 31.12.2003 Difference
(Euro/thousand) Turnover % on total Turnover % on total Difference %
Geographical area
- Italy 40,451,185 41.12 32,803,661 38.24 23.31
- Europe 37,541,844 38.16 35,379,755 41.24 6.11
- U.S.A. 5,652,535 5.75 5,541,872 6.46 2.00
- Rest of the world 14,725,779 14.97 12,068,563 14.07 22.02
Total 98,371,342 100.00 85,793,850 100.00 14.66
Italian revenues accounted for 41.12% of sales achieved - substantially in line with the previous year’s fi gure
(38.23%), whilst international sales accounted for 58.87% (vs. 61.76% as at December 31st 2003). Compared with
the previous FY there was an increase in sales in Italy (about +23.3% YoY) and to foreign affi liates (about +2.46%).
As regards the increase in sales to affi liates, we highlight the increase achieved in sales to the Spanish and French
affi liates - as better described in the report on operating performance.
Leading contributors to good sales performance were the lines relating to the licenses with Dolce & Gabbana and
Roberto Cavalli.
The item “Other revenues” included charge-backs of some € 853k for freight costs mainly relating to subsidiaries.
Below we show revenues coming from subsidiary and associated companies:
Company Revenues from sales
and services
Other Income
Financial income from
fi nancial receivables
Marcolin Asia Ltd. 27,476 1,313 0
Marcolin & Co. S.p.A. 0 6,968 0
Marcolin (Germania) GmbH 3,407,892 91,840 0
Marcolin GmbH (Svizzera) 1,228,755 9,077 19,266
Marcolin France S.a.r.l. 3,775,707 41,116 0
Marcolin Iberica S.A. 7,322,265 84,244 0
Marcolin Benelux S.p.r.l. 1,422,521 34,799 0
Marcolin Portogallo 1,524,997 12,602 0
Marcolin (U.K.) Ltd. 4,896,128 28,278 0
Marcolin U.S.A. Inc. 5,558,605 153,292 0
Marcolin Intern. B.V. 0 0 130,018
Cébé S.A. 811,825 158,199 142,777
Marcolin do Brasil Ltda. 1,045,766 65,149 0
Group total 31,021,937 686,878 292,062 32,000,876
Revenues from associated
companies (Finitec S.r.l.) 0 0 0 0
Total 31,021,937 686,878 292,062 32,000,876
Total

B) Production costs
Costs for raw & ancillary materials, consumables, and goods
Description
Marcolin S.p.A.
There was an increase of some € 4,383k in costs for the purchase of raw and ancillary materials, goods and
fi nished products.
We point out that during FY 2004 we reclassifi ed some costs concerning the purchase of components - previously
included among costs for outsourced processing (Item B7 - service costs - in year-end fi nancial statements) - in
order to represent the costs borne for this cost item better.
Applying the same accounting policy as that adopted during 2004, costs of raw and ancillary materials and of
fi nished products as at December 31st 2003 would have totalled some € 33,002k. Consequently, the real increase
vs. FY2003 was approximately € 946k (+2.9%). This increase, less than proportional to the increase achieved
in sales, is explained by optimisation of management of procurement of raw materials and of other production
input items.
Service costs
31.12.2004 31.12.2003
Raw materials 16,552,203 16,280,832
Ancillary materials 819,865 867,720
Packing 1,847,663 2,536,394
Finished products 14,728,460 9,879,811
Total 33,948,191 29,564,757
Description
31.12.2004 31.12.2003
Maintenance expenses 210,562 153,242
Subcontracting costs 4,168,269 7,284,980
Galvanizing treatments costs 2,037,171 2,133,504
Other ind. Costs 230,894 213,379
Cars (rent & maintenance) 398,105 369,640
Commission expences 5,611,818 4,550,572
Travel & other commercial costs 5,678,948 5,333,395
Energy & telephone 447,082 470,251
Insurance 185,798 167,221
Technical, legal, tax and administrative consulting costs 1,747,608 1,531,957
Advertising royalties 3,191,127 2,836,836
Others 2,393,198 2,337,802
Total 26,300,580 27,382,778
The decrease in outsourced production costs - about € 3,117k - was partly due to reclassifi cation of some costs
relating to purchase of raw materials and fi nished goods that in 2003 had been included in outsourced production
costs, as highlighted earlier.
The increase (of some € 1,061k) in commission expenses and joint participation in advertising expenses paid to
licensors (€ 355k) was directly correlated with sales growth achieved.
111

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Statutory Annual Report & Accounts
The increase of about € 346k in the amount of the item “Expenses for travel, commercial advisory services, others”
was mainly explained by the higher costs borne for attendance of sector trade shows (about € 326k) and by the
increase in sales freight costs (about € 240k).
Other service costs included remuneration for directors and statutory auditors, respectively amounting to some
€ 1,346k (vs. some € 1,182k as at December 31st 2003) and € 81k (vs. some € 83k as at December 31st 2003).
Rental, leasing, and royalty costs
The item included royalties of some € 7,022k for license contracts and costs for fi nancial leasing and rental
contracts of some € 645k.
Payroll costs
The item includes the entire expense for employees, for holidays not taken, for bonuses and for provisioning
required by law, as well as by the obligations established in national collective and supplementary company
collective labour contracts.
Average company employee headcount by category underwent the following changes vs. FY2003:
EMPLOYEES
The national collective labour contract applied is that of the eyewear sector. The contract was renewed on 27.05.2004,
taking effect as from 01.01.2004 and expires on 31.12.2005 as regards the monetary part and on 31.12.2007 as
regards the regulatory part.
Depreciation of tangible fi xed assets
Depreciation for the year, charged to the profi t & loss account, has been determined taking into account residual
possibility of use and, in particular, of the various assets’ purpose and business/technical duration.
Accruals for risks and contingencies
The amount indicated mainly related to provisioning for: returned goods and product warranties (about € 400k),
agent indemnities in the eventuality of termination by the company of the agency mandate (about € 175k), and for
legal risks (€ 142k).
Other operating charges
31.12.2004 31.12.2003 Difference
Managers 9 8 1
First line managers 15 15 -
White-collars 124 117 7
Blue-collars 327 342 -15
Other 26 25 1
Total 501 507 -6
These mainly related to dues paid to trade associations (about € 85k), taxes and levies other than income tax (€ 44k),
and to gifts in the form of the company’s products (€ 66k).

C) Financial income and charges
Marcolin S.p.A.
The net balance of fi nancial income and charges as at December 31st 2004 was negative by some € -829k vs. net
charges of some € -3,066k as at December 31st 2003.
Financial income from equity investments amounted to some € 931k and related to collection of dividends
distributed by Marcolin U.K. Ltd.
Other fi nancial income from subsidiaries amounted to € 292k and was substantially in line with that of FY2003.
This income related to interest accruing on loans granted to the subsidiaries Marcolin International B.V. and
Cébé S.A., and to the Swiss affi liate.
Other income other than the above included some € 540k for income relating to hedging transactions and some
€ 19k for interest earned on bank deposits.
Detail of fi nancial income
Description Associated Subsidiaries Other Total
Income from bonds - - -
Income from marketable securities - - -
Income from fi nancial receivables 292,062 292,062
Income from subsidiaries - 930,629 930,629
Other income 561,176 561,176
Total - 1,222,691 561,176 1,783,867
Total interest and other fi nancial charges (items 17 and 17/2 in the income statement) amounted to some € 2,613k
vs. about € 4,119k as at December 31st 2003.
Improvement was basically due to foreign-exchange differences, also thanks to some USD hedging transactions.
The balance of the total item was in fact negative by about € -110k as at December 31st 2004 as opposed to a
negative balance of some € -1,914k as at December 31st 2003.
The following table summarises fi gures for interest and other fi nancial charges and the balance of foreign-exchange
gains and losses:
Description Associated Subsidiaries Other Total
Loan interests 22,623 - 22,623
Bank interest expenses 2,231,498 2,231,498
Mortgage interests - -
Other fi nancial costs 248,577 248,577
Foreing exchange losses 110,036
Total 22,623 2,480,075 2,612,734
“Other fi nancial charges” mainly related to bank commission and expenses for an amount of some € 248k.
Alignment of items in currencies other than the euro to the exchange rate in force on December 31st 2004 led to
posting of a total charge of some € 638k.
113

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Statutory Annual Report & Accounts
Below we indicate all costs vis-à-vis subsidiary and associated companies:
Company
Cost of raw materials,
auxiliary materials,
spare parts and goods
Costs for services
D) Adjustments to value of fi nancial assets
Cost for utilization
of third parties’
assets (leasing)
Other
operating
charges
Financial
income and
charges
Extraordinary
income and
expenses
Marcolin Asia Ltd. 9,479 540,426 0 0 0 0 549,905
Marcolin & Co. S.p.A. 0 0 0 0 22,623 0 22,623
Marcolin (Germania) GmbH 417,402 0 0 0 0 0 417,402
Marcolin (Svizzera) GmbH 251,382 0 0 0 0 0 251,382
Marcolin France S.a.r.l. 2,705 0 0 0 0 0 2,705
Marcolin Iberica S.A. 71,035 0 0 0 0 0 71,035
Marcolin Benelux S.p.r.l. 0 0 0 0 0 0 0
Marcolin Portogallo 15,346 0 0 0 0 0 15,346
Marcolin (U.K.) Ltd. 66 0 0 0 0 0 66
Marcolin U.S.A. Inc. 1,697,457 0 0 0 0 0 1,697,457
Marcolin Intern. B.V. 0 0 0 0 0 0 0
Cébé S.A. 1,470,498 100,318 0 0 0 0 1,570,816
Total Subsidiaries 3,935,369 640,744 0 0 22,623 0,00 4,598,737
Costs from associated
(Finitec S.r.l.)
1,687,676 1,687,676
Total Group 3,935,369 2,328,421 0 0 22,623 0,00 6,286,413
As already indicated in the comments on “Financial fi xed assets” the company wrote down the book value
of some equity interests owned in subsidiaries by a total of € 6,700k due to impairment of value considered to
be permanent.
More specifi cally, write-down related to the following equity investments:
• Marcolin Deutschland = € 702k;
• Marcolin do Brasil = € 807k;
• Marcolin France = € 241k;
• Marcolin U.S.A. Inc. = € 4,950k.
The company also wrote back a total of € 1,303k - within the limit of original cost - of value for some other equity
investments in subsidiaries, previously written down due to permanent impairment of value, since the reasons
inducing directors to reduce related cost value had ceased to exist; specifi cally:
• Marcolin U.K. = € 792k;
• Marcolin Iberica = € 511k.
Total

E) Extraordinary income and expenses
Description
Marcolin S.p.A.
Extraordinary income and charges includes the fi gures stemming from “decontamination” of accounts relating to
accelerated depreciation provisioned in previous FYs solely for tax purposes. Posting of this “decontamination”,
also based on the indications of the OIC 1 document (issued by the Italian Accounting Association - OIC), has
been done using the P&L method. More specifi cally, the fi gures posted in year-end accounts are the following
(in euro/thousand):
• Extraordinary income from “decontamination” € 2,065
• Deferred taxes relating to previous FYs € (721)
• Net effect of “decontamination” € 1,344
31.12.2004 31.12.2003
Income from writeoffs of liabilities and expenses reversals 67,912 162,370
Prior period income 153,635 98,286
Other income 2,073,486 125,520
TOTAL INCOME 2,295,032 386,176
Prior year taxes -803,900 -485,755
Other expenses -98,056 -217,981
TOTAL EXPENSES -901,956 -703,736
TOTAL EXTRAORDINARY INCOME AND EXPENSES 1,393,077 -317,560
(Euro/thousand)
Profi t (loss)
for the 2004
Profi t (loss)
for the 2003
Shareholders
Equity 2003
Results before the cleaning up
Fiscal interferences gross if deferred taxes
311 (4,152) 53,342
Exceeding Depreciation 2,065 212 1,853
Total Gross Interferences 2,065 212 1,853
Deferred Taxes Associated (721) (74) (647)
Total Interferences Net of Deferred Taxes 1,344 138 1,206
Results after the cleaning up 1,654 (4,014) 54,548
Other extraordinary income mainly consisted of (a) reimbursement of insurance claims (some € 91k), (b) reversal of
accrued agent indemnity provision due to agent resignations (€ 18k), (c) establishment of non-existence of amounts
payable to the Inland Revenue for corporate income tax and regional business tax for FY2003 (about € 50k),
and (d) establishment of non-existence of debt posted in previous years concerning legal cases closed during
FY2004 (€ 45k).
Some € 83k of extraordinary charges related to establishment of non-existence of tax receivables for corporate
income tax for FY2003 (some € 50k) and to establishment of non-existence of trade payables of some € 60k.
115

116
Statutory Annual Report & Accounts
Income taxes in the year
Current income taxes refers to provisioning of corporate income taxes and regional business taxes calculated on
the year’s taxable income.
The total taxes burden consisted of current taxes and of deferred taxes income and expenses, the detail of which is
as follows:
Description
31.12.2004 31.12.2003
Current taxes 3,753,628 1,983,388
Deferred taxes 120,830
Accrued taxes 786,408 (2,770,765)
TOTAL INCOME TAXES 4,660,866 (787,377)
As per the provisions of Italian accounting standard no. 25, in the attachments we provide a tax reconciliation table.
Other information
In compliance with Attachment 3C, Template 1 of CONSOB Regulation no. 11971 of 14/5/1999, below
we list remuneration for directors, statutory auditors, and general managers posted on the basis of
temporal applicability.

Remuneration paid to directors, statutory auditors and general managers
Recipient Details of offi ce held Emoluments
Surname and name Offi ce To From Fringe
Benefi ts
Coffen Giovanni
Marcolin
Zandegiacomo
Maria Giovanna
Coffen Marcolin Maurizio
Coffen Marcolin Cirillo
Bortuzzo Antonio
(*) emolument gross of social charges.
Marcolin S.p.A.
The present year-end report and fi nancial statements, consisting of the Balance Sheet, Income Statement, and
Explanatory Notes, provide truthful and proper representation of statutory balance sheet and fi nancial status, as
well as of the business result in the period concerned, and match accounting entries.
Giovanni Marcolin Coffen
Chairman of the Board of Directors
Longarone, March 18th 2005
Chairman of Board of Directors of Marcolin S.p.A.
Managing Director of Marcolin & Co. S.p.A.
29.04.2004 approval 2006 fi n. stats.
234,000
500
Bonuses Other
Managing Director of Marcolin S.p.A. 23.04.2001 29 april 2004 37,800 54,000
Vice Chairman and Managing Director
of Marcolin S.p.A.
Managing Director of Marcolin S.p.A
Vice Chairman and Managing
Director of Marcolin & Co. S.p.A.
Managing Director of Marcolin S.p.A.
General Director of Marcolin S.p.A.
C.E.O. Marcolin U.S.A. Inc.
29.04.2004 approval 2006 fi n. stats. 334,000 50,000
29.04.2004 approval 2006 fi n. stats.
29.04.2004
28.10.2002
01.09.2003
approval 2006 fi n. stats.
approval 2006 fi n. stats.
334,000
500
94,383
USD 104,978
Drago Giorgio Director of Marcolin S.p.A. 29.04.2004 approval 2006 fi n. stats. 10,500
Dallocchio Maurizio Director of Marcolin S.p.A. 29.04.2001 approval 2006 fi n. stats. 15,750
Alemagna Emanuele Director of Marcolin S.p.A. 23.04.2001 approval 2006 fi n. stats. 10,450
Ruella Cristiana Director of Marcolin S.p.A. 23.04.2001 29 april 2004 -
Petocchi Enrico Director of Marcolin S.p.A. 29.04.2004 approval 2006 fi n. stats. 3,500
50,000
150,000 161,934*
Bartoletti Sandro Director of Marcolin S.p.A. 29.04.2004 approval 2006 fi n. stats. 20,000 88,642*
Zulli Claudio Agostino
Rivetti Diego
D’Ambrosi
Galeazzo Osvaldo
Funes Rino
Chairman of the Board of Statutory Auditors
of Marcolin S.p.A. up to 29.04.2004
Chairman of the Board of Statutory Auditors
of Marcolin S.p.A. from 29.04.2004
Auditor Marcolin S.p.A.
Chairman of the Board of Statutory Auditors
of Marcolin & Co. S.p.A.
Auditor Marcolin S.p.A.
Auditor Marcolin & Co. S.p.A.
23.04.2001 29 april 2004 27,393
29.04.2004 approval 2006 fi n. stats. 6.759
29.04.2004 approval 2006 fi n. stats.
29.04.2004 approval 2006 fi n. stats.
Grazioli Emilio Alternate Auditor Marcolin S.p.A. 23.04.2001 approval 2003 fi n. stats. -
Guazzotti Giannantonio
Alternate Auditor Marcolin S.p.A.
Auditor Marcolin & Co. S.p.A.
23.04.2001 approval 2003 fi n. stats.
22.773
2.371
22.773
889
-
889
117

118
Statutory Annual Report & Accounts
ATTACHMENTS

MOVEMENTS OF INTANGIBLE ASSETS
Total
Other
intangible assets
Assets under
construction
and advances
Goodwill
Concessions
licenses and
trademarks
Industrial
and other
patent rights
Research
Development costs
and advertising costs
Start-up and
expansion
costs
Initial situation
Historical cost 190 19,041 154,625 70,535 17,414 609,718 1,133,944 2,005,466
Revaluation on prior years 0 0 0 0 0 0 0 0
Write-downs on prior years 0 (19,039) 0 0 0 0 0 (19,039)
Restoration of values in prior periods 0 0 0 0 0 0 0
Exits from consolidation area 0 0 0 0 0 0 0 0
Total at the fi scal year beginning 190 2 154,625 70,535 17,414 609,718 1,133,944 1,986,427
Changes
Reclassifi cations 0 0 0 0 0 0 0 0
Acquisitions 0 0 36,167 300,000 0 1,399,220 224,208 1,959,595
Disposals 0 0 0 0 0 0 0 0
Revaluations 0 0 0 0 0 0 0 0
Write-downs 0 0 0 0 0 0 0 0
Amortization (188) 0 (124,726) (95,555) (2,488) 0 (300,408) (523,365)
Restoration of values (1) (2) 0 0 0 0 0 (4)
Translation differences 0 0 0 0 0 0 0
Total changes (190) 0 (88,559) 204,445 (2,488) 1,399,220 (76,201) 1,436,228
Final situation
Historical cost 0 2 66,066 274,980 14,926 2,008,938 1,057,743 3,422,656
Revaluations 0 0 0 0 0 0 0 0
Write-downs 0 0 0 0 0 0 0
Restoration of values (1) (2) 0 0 0 0 0 (4)
Total year-end 0 0 66,066 274,980 14,926 2,008,938 1,057,743 3,422,653
Marcolin S.p.A.
119

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Statutory Annual Report & Accounts
MOVEMENTS OF TANGIBLE ASSETS
Total
Construction in
progress and advances
Other
tangible assets
Industrial
and commercial
equipment
Plant
and Machinery
Land
and buildings
Initial situation
Historical cost 3,119,243 8,213,155 7,321,211 4,176,009 16,467 22,846,085
Reveluation on prior years 26,301 22,093 0 0 48,394
Restoration of value in prior periods 0 19 0 (24,095) (24,076)
Write-downs on prior years 0 0 0 0 0
Depreciation on prior year (1,124,052) (7,430,783) (6,752,220) (3,295,446) (18,602,502)
Exits from consolidation area 0
Total at the fi scal year beginning 2,021,491 804,484 568,991 856,468 16,467 4,267,901
Changes
Reclassifi cations 0 0
Acquisitions 0 147,018 972,236 422,583 29,517 1,571,353
Disposals 0 (398) 0 0 (45,983) (46,381)
Revaluations 0 0 0 0 0 0
Write-downs 0 0 0 0 0 0
Translation differences 0 0 (1) 0 0 (1)
Depreciation (91,470) (515,657) (819,618) (535,504) 0 (1,962,249)
Translation differences 0
Total changes (91,470) (369,037) 152,616 (112,920) (16,467) (437,278)
Final situation
Historical cost 3,119,243 8,359,775 8,293,447 4,598,592 0 24,371,057
Revaluations 26,301 22,093 0 0 0 48,394
Write-downs 0 19 0 (24,095) 0 (24,076)
Restoration of value 0 0 (1) 0 0 (1)
Cleaning up 65,311 937,555 435,509 627,169 2,065,544
Depreciation (1,215,523) (7,946,440) (7,571,838) (3,830,950) 0 (20,564,751)
Total year-end 1,995,332 1,373,003 1,157,116 1,370,717 0 5,896,167

MOVEMENTS IN NET SHAREHOLDERS EQUITY
Total
Profi t (losses)
for the period
Profi t (losses)
carried
forward
Other
reserve
Reserve
for treasury
stock
Statutory
reserve
Legal
reserve
Revaluation
reserve
Movements Share capital Share
premium
reserve
Beginning Balance 23,596,560 21,950,034 1,566,650 717,751 10,652,860 1,070,403 59,554,258
Profi t for the period destination 0
- dividend allocation (euro ___ per share) (278,086) (1,016,882) (1,294,969)
- other destinations 53,520 42,245 (42,245) (53,520) 0
Other changes: 0
………………………………… 0
………………………………… 0
Profi t (losses) from the previous year (6,147,956) (6,147,956)
Ending Balance 23,596,560 21,950,034 0 1,620,170 0 759,996 0 10,332,528 (6,147,956) 52,111,333
Profi t for the period destination 0
- dividend allocation (euro ___ per share) 0
- other destinations (6,147,956) 6,147,956 0
Other changes: 0
………………………………… 186,593 (186,593) 0
………………………………… 0
Profi t (losses for the period) 1,654,453 1,654,453
Ending Balance Values 23,596,560 21,950,034 0 1,620,170 0 946,589 0 3,997,980 1,654,453 53,765,787
Marcolin S.p.A.
121

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Statutory Annual Report & Accounts
DIRECT EQUITY INTEREST
Participation
Value
31.12.2004
Depreciation Revaluation
% ownership Participation
Value
Net Equity Result of the
period
Headquarters Currency Capital
Stock
Company
31.12.2003
Marcolin & Co. S.p.A. Longarone EUR 593,130.00 616,474.36 -2,898.79 99.96% 610,036 610,036
Marcolin France S.a.r.l. Morez EUR 577,744.58 90,883.88 -167,195.35 99.99% 331,956 -241,000 90,956
Marcolin (Deutschland) GmbH Ludwigsburg EUR 300,000.00 365,060.59 -452,912.99 100.00% 1,067,144 -702,000 365,144
Marcolin (U.K.) Ltd. Newbury EUR 1,205,588.26 3,123,643.86 280,651.89 99.88% 236,800 791,871 1,028,671
Marcolin Iberica S.A. Barcelona EUR 487,480.92 2,995,092.78 485,884.68 100.00% 315,185 510,775 825,960
Marcolin GmbH (Svizzera) Fullinsdorf (CH) EUR 129,626.03 903,963.27 -68,695.44 100.00% 424,259 424,259
Marcolin Portugal Lda. S. Joao do Estoril EUR 420,000.00 1,115,827.02 46,222.16 99.82% 413,758 413,758
Marcolin Benelux S.p.r.l. Faimes EUR 240,000.00 293,571.12 -135,504.36 99.98% 95,300 95,300
Marcolin U.S.A. Inc. New York EUR 393,877.10 11,603,823.78 -2,105,752.15 85.40% 23,106,991 -4,950,000 18,156,991
Marcolin Intern. B.V. Amsterdam EUR 18,151.21 2,969,700.09 -1,882,305.03 100.00% 924,675 924,675
Marcolin do Brasil Ltda. Jundiai EUR 683,134.49 348,959.09 -84,122.28 99.90% 1,156,269 -807,000 349,269
Participation
Value
31.12.2004
Participation
Value
31.12.2003
% ownership
Net Equity Result of the
period
Company Headquarters Currency Capital
Stock
Finitec S.r.l. Longarone EUR 54,080.00 1,340,995.67 58,579.45 40.00% 258,228 258,228.45
INDIRECT EQUITY INTEREST
Company Headquarters Currency Capital Stock % ownership
Marcolin Asia Ltd. Hong Kong USD 198,863.00 100.00%
Marcolin U.S.A. Inc. New York EUR 393,877.10 14.60%
Cébé S.A. Morez EUR 3,004,918.00 100.00%
Cébé Sport S.A. Nyon CHF 300,000.00 99.00%
Cébé Scandinavia A.B. Avesta SEK 100,000.00 100.00%
Cébé Japan Ltd. Tokyo JPY 3,000,000.00 100.00%

FINANCIAL METHOD LEASING - Shareholders’ equity and Income statement effects
Marcolin S.p.A.
Balance Sheet (Euro/thousand)
a) Active Contracts
euro
Financial leased goods at the end of previous year, net of previous years depreciation
(euro 564) 1,073
Financial leased goods during the year 0
Financial leased goods redeemed during the year 0
Year depreciation amount
b) Redeemed goods
-106
967
Redeemed goods value surplus according with the fi nancial method against
the net accounting value at the end of the period 0
c) Liabilities
Implicit debts for fi nancial leasing operations at the end of previous year
(of which expiring the following year EUR 141, expiring from 1 to 5 years
327 and EUR 0 expiring over 5 years) 469
Implicit debts arised during the year 0
Decrease for capital redemption and reimbursment during the year -141
Implicit debts for fi nancial leasing operations at the end of the year
(of which expiring the following year EUR 148, expiring from 1 to 5 years
179 and EUR 0 expiring over 5 years) 327
d) Overall gross effect at the end of the period (a+b+c) 639
e) Fiscal Net Effect * -238
f) Shareholders’ Equity effect at the end of the period (d - e) 401
INCOME STATEMENT (Euro/thousand) euro
Fee reversal on fi nancial leasing operations 160
Financial charges accounted on fi nancial leasing -18
Accounting of
- depreciation amounts:
* on existing contracts -106
* on redeemed goods 0
- adjustment / value recovery on fi nancial leasing goods 0
Effects on the result before taxes 35
Fiscal effect evaluation * -13
Leasing operations accounting effects on the profi t (losses) for the period
with the fi nancial method 22
* The fi scal effect has been evaluated with a tax rate of 37.25%
123

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Statutory Annual Report & Accounts
THEORETICAL VERSUS FINANCIAL STATEMENT FISCAL CHARGES RECONCILIATION
IRES
Profi t (loss) before taxes 6,315,319
Theoretical Fiscal Charge 33% 2,084,055
Temporary differences to be taxed in following years -236,596
Differences to be deducted in following years 1,416,607
Previous years temporary differences cancellation -5,854,496
Permanent differences not to be cancelled in following years 5,801,499
Losses of previous tax years
Total differences 1,127,014
Taxable income 7,442,333
Current taxes on income 33% 2,455,970
Taxes ex art. 167 TUIR (foreign subsidiaries - CFC)
Notional profi t (loss) before taxes 115,317
Notional fi scal charges (average tax rate) 33% 38,054
Taxes payed abroad -12,376
Current Taxes 25,679
IRAP
Differences between Value and Cost of Production (except B9 and B10c,d) 27,920,729
Costs for apprentices, disabled and compulsory insurances -305,802
Total 27,614,927
Theoretical Fiscal Charge 4.25% 1,173,634
Temporary differences to be taxed in following years -236,596
Differences to be deducted in following years 430,884
Previous years temporary differences cancellation -578,842
Permanent differences not to be cancelled in following years 2,698,553
Total differences 2,313,999
Taxable income 29,928,925
Current taxes 4.25% 1,271,979
Total Current Year Taxes Valute 3,753,628

Marcolin S.p.A.
125

126
Statutory Annual Report & Accounts
MARCOLIN S.p.A. STATEMENT OF CASH FLOWS

MARCOLIN S.p.A. STATEMENT OF CASH FLOWS
Marcolin S.p.A.
(Euro/thousand) 31.12.2004 31.12.2003
Net Financial Position - Beginning balance (35,979) (29,092)
ASSETS
Profi t (losses) during the year 1,654 (6,148)
Intangible assets amortization 523 1,108
Tangible assets depreciation 1,962 2,057
Provision for Staff Leaving Indemnities 873 858
Provision for Contingencies and Commitments 1,632 184
Other funds utilization (368) 105
Devaluation (Revaluation) of investments 6,700 11,099
(Gains) losses on disposals of fi xed assets (2,066) 0
Total cash fl ow generated from operations 10,912 9,306
(Increase) decrease in accounts receivable (8,491) (5,776)
(Increase) decrease in other receivables 1,586 (3,363)
(Increase) decrease in inventories 1,079 (3,543)
(Increase) decrease in prepayments and accrued income 475 (42)
(Decrease) increase in accounts payables (2,699) 3,971
(Decrease) increase in other short-term debts and taxes 2,415 (1,263)
Employees’ Leaving Indemnity paid (666) (288)
Cash fl ow generated from working capital (6,302) (10,304)
ACTIVITY FROM INVESTMENTS:
Investments/disposals intangible fi xed assets (1,960) (1,897)
Investments/ disposals tangible fi xed assets (1,525) (1,726)
(Purchase) disposal of other investments and securities - revaluations (5,523) (972)
Cash fl ow from (for) investment activities (9,007) (4,594)
Equity increase 0 0
Payment of dividends 0 (1,295)
Change in reserves 0 0
Change in third parties equity 0 0
Total cash fl ow generated from equity movements 0 (1,295)
Net Financial Position - Closing balance (40,375) (35,979)
Detail of Cash and Cash equivalents - Closing balance 31.12.2004 31.12.2003
Treasury Stock 947 760
Cash on hand 3,226 7,219
Current payables due to banks (13,982) (17,615)
Medium/long-term payables due to banks (29,773) (25,767)
Other fi nancing payables (793) (576)
Total Net Financial Position (40,375) (35,979)
127

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