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11 Mar 2008

Bulgari Group: excellent financial results in 2007

	Turnover	1,091.0 million Euro
		(+ 13.6% at comparable exchange rates)
	Gross Margin	699.1 million Euro (+8.0%)
	Operating profit	164.5 million Euro (+4.7%)
	Net profit	150.9 million Euro (+12.4%)
	Proposed dividend	0.32 Euro per share (+10.0%)

Rome, March 11^th 2008 – The Board of Directors of Bulgari S.p.A. approved today the draft financial statement for the Company and the draft consolidated financial statements for the Group for the full year 2007.

All the variations reported below and related to the revenues are expressed at comparable exchange rates unless noted otherwise.

Bulgari Group consolidated turnover for the full year 2007 reached 1,091.0 million Euro, compared to 1,008.7 million Euro in 2006 (+13.6% at comparable exchange rates and +8.2% at current exchange rates) and the financial year ended with excellent sales results for the Group: all product categories, in fact, benefited from the constant research and innovation carried out by the Company and from the new product launches made during the year. Jewellery increased by 20.0%, perfumes by 15.4%, watches by 8.2%, accessories by 1.2% in line with the Company's expectations.
As far as geographical areas are concerned, they all enjoyed a strong growth: United States (+21.0%), Asia (+14.8%) and Europe (+10.2%).
As far as revenues by sales channel are concerned, in 2007 sales in the directly owned stores showed an increase much higher than the one posted through third party distributors. This performance is particularly remarkable considering that the new store openings were concentrated in the last part of the year, thus only marginally contributing to the overall sales increase.
On this subject, as of December 31^st 2007 the total number of Bulgari Group stores was 245 (+17 compared to December 31^st 2006), of which 149 were directly owned stores (+16).

Gross margin – from 647.4 million Euro in 2006 to 699.1 million Euro in 2007 (+8.0%) – remained substantially stable in terms of percentage ratio on turnover (64.2% in 2006 vs. 64.1% in 2007). The stability of the margin has been secured thanks to the increasing vertical integration achieved by the Group, to the successful measures adopted to increase production efficiency and to the selling price increases introduced during the year, and despite the negative impact of exchange rates (yen and dollar in particular) and the significant rise in prices of raw materials (mainly gold and precious stones). It is worth underlining that, as already occurred in the past, the Company made hedging transactions on exchange rates and gold price, whose positive results are reported in the Profit and Loss account as "financial income", also for the portion related to commercial operations. Also during 2007 the result of such hedging represented a significant and positive contribution to income.

Operating costs, which overall went from 490.3 million Euro in 2006 to 534.6 million Euro in 2007 (+9.0%), reflect two distinct dynamics: on the one hand the continued investments to enlarge and upgrade the distribution network and to develop production capacity; on the other hand the relevant non-recurring effects due to the launch of the skincare project and the opening of three flagship stores at the end of the year (the accessories-only store in Rome, the Omotesando complex and the Ginza Tower in Tokyo).
Advertising and promotional activities reached 119.6 million Euro (+5.9%) with a 11% ratio on turnover, substantially in line with the previous years.
Operating profit was therefore 164.5 million Euro increased +4.7% compared to 157.1 million Euro in the previous year, with a slightly lower percentage ratio on turnover (15.1% in 2007 vs. 15.6% in 2006). It is worth underlining that, stripping the non-recurring effects mentioned above from the overall costs increase, the percentage increase of the operating profit versus the previous year would have been at double digit.

Net profit – 150.9 million Euro compared to 134.4 million Euro in the previous year – was slightly higher (+12.4%) than the corporate guidance and represented 13.8% of turnover (13.3% in 2006). This improvement, as mentioned before, was also due to the hedging transactions on exchange rates and precious metals carried out by the Company - and reported as "financial income" - and to a significant improvement of taxation, which must be ascribed to non-recurring factors.

In 2007, as forecast, the Company carried out a very challenging investments plan, which implied an overall expense of 117 million Euro aimed to: increase the existing production capacity; strengthen the vertical integration in the watch segment through acquisitions; further expand the distribution network with the already mentioned flagship stores; improve the information systems.

Financial net indebtedness of the Group as of 31.12.2007 was 141 million Euro compared to 47 million Euro as of 31.12.2006 and was influenced by the size of the investments and by the increase of the inventory from 529 million Euro at the end of 2006 to 596 million Euro at the end of 2007 (+13%), whose rotation slightly decreased to the level of December 2005. A considerable part of the inventory increase was linked to lower production volumes, due to the shortages in sourcing some technical watch components, and therefore resulting in an increase of semi manufactured products.

The Board of Directors has also approved the draft financial statement for the parent company Bulgari S.p.A., which highlighted a net profit of 51.4 million Euro (compared to 79.9 million Euro in 2006). The parent company's total revenues were 86.1 million Euro (73.4 million Euro in 2006), with a 17.3% increase.

Finally, the Board of Directors has also approved to propose the distribution of a unit dividend of 0.32 Euro compared to 0.29 Euro for the previous financial year (+10%) by distributing the whole net profit of the year and part of the retain earnings and reserves. This proposal will be submitted to the approval of the Annual General Meeting taking place next April 18^th, 2008 11.00 am on first call and on April 21^st, 2008 11.00 am on second call. The Board also approved to submit to the Annual Meeting the date of May 22^nd, 2008 for the dividend payment by clipping coupon n. 14 on May 19^th, 2008.

The Board of Directors of Bulgari S.p.A. examined and approved the Annual Report on Corporate Governance and the adherence to the Code of Conduct for Listed Companies for FY 2007.
The Board of Directors also resolved to put to the vote of the Shareholders at their next meeting the authorisation to buy and sell the Company's own shares, to be used to stabilise the stock price, to create the Company's own portfolio which may be used to service the issuance of convertible bonds or warrants or to allow a reduction of the share capital, if any, through cancellation of such shares. The authorisation, which is a common practice for listed companies, in accordance with the requirements of Art. 144-bis of the Consob Regulation for Issuers, concerns the purchase and/or sale of a maximum of 15,400,000 of its own shares. The authorisation is requested for a maximum period of 18 months from the date of the shareholders meeting which will decide to authorise said purchase and/or sale. The corresponding minimum and maximum purchase and/or sale price shall not be less than Euro 5 and shall not exceed Euro 18 each. As of today, the Company owns 800.000 shares.

Francesco Trapani, Chief Executive Officer of the Bulgari Group, thus commented: "I am very satisfied with the excellent results, even better than our guidance, posted by the Group in 2007 in all product categories and geographical areas where it is present.
2008 for Bulgari will be characterised by a strong commitment for the further development of the business in all product categories and by an attentive investments policy to strengthen the distribution and manufacturing projects. This will have its core in the opening of a new flagship store in Paris, Avenue George V; in the strengthening of our presence in the rest of Asia; in the integration of the recent acquisitions; in the consolidation of the growth in the accessory segment and in the progressive worldwide launch of the women' skincare line. In light of these important initiatives and in a volatile and uncertain macroeconomic environment, in 2008 the Bulgari Group expects to achieve a further increase in sales (at comparable exchange rates), in operating profit and in net profit between 8% and 12%, further consolidating at the same time its position of absolute prestige in the worldwide luxury market."

For further information

Media Relations Paolo Piantella Corporate Financial Press Office Director tel. +39 06 68 810 593 e-mail paolo.piantella@bulgari.com www.bulgari.com

Analysts / investors relations Renata Casaro Investor Relations Director tel. +39 06 68 810 467 e-mail renata.casaro@bulgari.com http://ir.bulgari.com

BULGARI GROUP

EUR M.	2007	2006
REVENUES	1091.0	1008.7
EBIT	164.5	157.1
EBIT % ON REVENUES	15.1%	15.6%
NET PROFIT	150.9	134.3
NET % ON REVENUES	13.8%	13.3%

BULGARI GROUP – REVENUES BY PRODUCT CATEGORY – FY 07

	FY 2007		FY 07/ FY 06		FY 06/ FY 05
REVENUES BY PRODUCT CATEGORY	EUR M.	% On Revenues	% REPORTED	% COMP. FX.	% REPORTED	% COMP. FX.
Jewels	459.9	42.2%	14.4%	20.0%	9.1%	11.2%
Watches	294.8	27.0%	2.0%	8.2%	7.8%	10.2%
Accessories	84.4	7.7%	-5.1%	1.2%	15.4%	18.8%
Other (incl. FR royalties)	7.5	0.7%	1.5%	-	14.5%	-
JWA Division	846.6	77.6%	7.5%	13.5%	9.3%	11.2%
PARFUM Division	221.9	20.3%	11.0%	15.4%	9.5%	10.7%
OTHER	22.5	2.1%	4.7%	-	36.5%	-
TOTAL	1091.0	100%	8.2%	13.6%	9.8%	11.8%
BULGARI GROUP – REVENUES BY GEO AREA – FY 07
	FY 2007		FY 07/ FY 06		FY 06/ FY 05
REVENUES BY GEO AREA	EUR M.	% On Revenues	% REPORTED	% COMP. FX.	% REPORTED	% COMP. FX.
EUROPE	427.3	39.2%	10.2%	-	11.3%	-
of which Italy	141.4	13.0%	7.6%	-	1.2%	-
AMERICAS	176.4	16.2%	12.1%	21.0%	14.0%	15.1%
ASIA	429.3	39.3%	5.6%	14.8%	7.4%	10.9%
of which Japan	231.7	21.2%	-9.7%	-0.9%	7.4%	13.6%
of which Rest of Asia	197.6	18.1%	31.9%	41.2%	7.3%	6.6%
MIDDLE EAST/OTHER	58.0	5.3%	1.5%	-	7.0%	-
TOTAL	1091.0	100%	8.2%	13.6%	9.8%	11.8%

Source: Bulgari S.p.A. - Unaudited results

In accordance with our statutory auditors KPMG, please note that some items have been reclassified and restated for both fiscal years 2006 and 2007:
a) Commissions to distributors (perfume USA) are now deducted from revenues. Previously revenues were reported gross of commissions, and these were deducted as variable expenses.
b) Withholding taxes are now classified below the EBIT level. Previously they were included in the operating costs.

The manager responsible for preparing the company’s financial reports, Alberto Nathansohn, declares, pursuant to paragraph 2 of Article 154-bis of the Consolidated Law on Finance, that the accounting information contained in this press release faithfully represent the Company financial results, as well as its books and accounting records.