185000000 IT Holding Finance SA

We operate an 8,000 square meter warehouse and automated distribution center located in premises adjacent to our
main production facility in Pettoranello di Molise, Italy, which is used to inspect, package, consolidate and ship our
products throughout the world. The distribution center has a shipping capacity of 95,000 units per day and is
equipped with a bar code scanning and automated handling system that is integrated with our management
information system. In order to ensure the quality of our products, we do not permit finished goods to be shipped
directly from contractors to our customers, but rather take delivery of all finished goods at our warehouses, so that
our employees may carry out inspection procedures prior to packaging and shipment to customers. We inspect,
package, consolidate and ship our Gianfranco Ferré first-line products through the use of another 2,500 square
meter warehouse and automated distribution center located in Bologna, Italy.
Our Malo sales and distribution structure comprises our warehouse located in Campi Bisenzio, showrooms in
Milan, Düsseldorf, New York, Osaka, Tokyo and Seoul, 17 directly operated Malo brand boutiques, 27 franchised
Malo brand boutiques and a network of wholesalers that distribute Malo products to prestigious department stores
and multi-brand boutiques in the world. We also operate two factory outlets in Italy, in Campi Bisenzio and
Serravalle Scrivia, and two in the United States, in Woodbury Commons, New York and Clinton, Connecticut.
We dispose of most of our end-of-season overstocks at discounted prices through our factory outlet stores. In
addition, from time to time, we engage specialized distribution agents to dispose of overstocks outside of our
principal markets pursuant to stringent restrictions on the timing and location of such disposals. Our overstock
disposals, which typically amount to approximately 2% to 3% of our net sales each season, usually enable us to
recover our production costs on such items.
We make use of a sophisticated management information system to support the design, sourcing, manufacturing,
marketing and distribution functions of our business. Our management information system allows the monitoring
of, among other things, manufacturing and delivery schedules, raw material and finished goods inventories, client
accounts receivable, order flow and sales to clients. As a result, our management is able to react promptly to
changing fashion trends, order volumes, and problems in the production process.
In addition, our management information system has permitted us to automate certain stages of the prototype
development process and to achieve real time information flows across our design and manufacturing functions
with respect to changes in product specifications. We have also adopted a custom-designed “groupware” software
package that enables, among other things, simultaneous access to product prototype computer files by multiple
users. We have also integrated our information system with the information systems of our principal contractors,
fabric suppliers and clients in order to enable us to receive real time data with respect to the status of production,
shipments and orders.
Licenses and other intellectual property
Trademarks and Trade Names. As of the date of this annual report, the principal owned trademarks or trade
names of our core apparel and accessories business were Gianfranco Ferré, Ferré, GF Ferré, Malo and Extè.
These trademarks and trade names are registered in the countries in which we sell our relevant apparel and
accessories products.
Licenses. We have license agreements with several companies pursuant to which our young lines and accessories
businesses produce, distribute and market their products. The table below sets forth the brands licensed,
geographic areas covered and expiration dates of the license agreements for our principal brands:
32