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Interim Results

Interim Results June 11, 2004 Key figures for winter 2004 Strong growth in operating income… (in millions of euros) Like-for-like revenues Operating income % very satisfied customers +4.5% Win 03 vs Win 02: +10% Win 04 vs Win 03: +9% 32 784 764 750 12 (4) Winter 02 Winter 03

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Interim Results

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  1. Interim Results June 11, 2004

  2. Key figures for winter 2004 • Strong growth in operating income… (in millions of euros) Like-for-like revenues Operating income % very satisfied customers +4.5% Win 03 vs Win 02: +10% Win 04 vs Win 03: +9% 32 784 764 750 12 (4) Winter 02 Winter 03 Winter 04 Winter 02 Winter 03 Winter 04 Business model validated

  3. Validation for the new business modelin America • Club Med America: actions undertaken are delivering results (€m) Like-for-likerevenues Operatingincome Environment • An improving economic and geopolitical environment +9.4% Club Med highlights 129 • Increased business 118 1) Success of the Total All Inclusive package 2) Growth in direct sales and sales through travel agencies 3) Impact of low prior-year comparatives 10 2 Winter 03 Winter 04 Winter 03 Winter 04 • Substantial increase in operating income

  4. Validation for the new business modelin Asia • Club Med Asia: first positive impact from prior-year comparatives (€m) Like-for-likerevenues Operatingincome Environment • Economic upturn in certain markets • Health situation under control +4.6% Club Med highlights • First positive impact from low prior-year comparatives (Bali,SARS) revenues up 25% YOY in April alone • Increased sales in Japan, Australia andSingapore, and start-up of sales in China 66 63 3 0 Winter 03 Winter 04 Winter 03 Winter 04

  5. Validation for the new business modelin Europe • Club Med Europe: firm resilience in a tough market (€m) Like-for-likerevenues Operatingincome Environment • No economic upturn in Europe • Difficult economic conditions in France Club Med highlights 425 425 19 • Sustained success of Ski packages • In France: increased sales through the new distribution channels  Surge in Internet bookings Success of the new indirect network • Firm resistance from the Club Med agencies • Decline in business from the traditional indirect network and via phone • Improved resistance in the rest of Europe 14 Winter 03 Winter 04 Winter 03 Winter 04

  6. Key figuresfor winter 2004

  7. Key figures Winter 02 Winter 03 Winter 04 (in millions of euros) Consolidated revenues • Reported • Like-for-like 816 785 784 750 765 784 Operating result (4) 12 32 Group net result (25) (29) (4) Capital expenditures (83) (40) (44) Disposals 45 44 33 Free cash flow 6 (6) (33) Net debt (421) (436) (424)

  8. Activities Winter 03 Winter 04 Variation 763,800 Number of customers • incl. Club Med customers • incl. Jet tours customers 771,100 +1.0% 639,200 642,400 +0.5% 124,600 128,700 +3.4% -0.7% Hotel days sold 4,012,000 3,984,000 -4.5% Capacity in hotel days 5,807,000 5,546,000 Occupancy rate 69.1% 71.8% +2.7 pts +2.4% Like-for-like revenues €765 m €784 m +5.9% Like-for-like revenues – Stay / HD €104.4 €110.6

  9. Price / Mix Change impact Change in business base Volume Consolidated revenues • Change winter 04 vs winter 03: +2.4% on a like-for-like basis (in millions of euros) -6 +25 -17 -3 785 (1) (2) (4) (3) 784 (1) Winter 04 (3) Winter 03 (4) (2)

  10. Operating result by zone and business Winter 02 Winter 03 Winter 04 (in millions of euros) Europe 13 14 19 Asia 2 0 3 (13) 2 10 America • Villages activity 2 16 32 Tour operating (3) 0 1 Other activities (3) (4) (1) (4) 12 32 • Total Group

  11. Analysis of results from Villages activity (in millions of euros) Winter 02 Winter 03 Winter 02 OPERATING RESULT 2 16 2 2 0 2 • Change impact • Volume impact • Mix/Price impact • Others (2) (5) (7) 10 22 32 4 (1) 3 OPERATING RESULT 16 32 32 Winter 03 Winter 04 Winter 04

  12. Analysis of results in Europe (in millions of euros) Like-for-like Reported W.03 Op. result 14 Winter 03 Winter 04 Revenues * 430 429 • Change impact • Volume impact • Mix/Price • Others 0 (7) Margin on var. costs 234 234 9 % of revenues 54.4% 54.5% 3 Fixed selling costs (52) (52) 19 W.04 Op. result Fixed operating costs (155) (153) Overheads (13) (10) Operating result 14 19 % of revenues 3.3% 4.4% * Including interzone revenues

  13. Analysis of results in Asia (in millions of euros) Like-for-like Reported W.03 Op. result 0 Winter 03 Winter 04 Revenues * 82 82 • Change impact • Volume impact Asia / AsiaEurope / Asia • Mix/Price • Others 1 0 Margin on var. costs 46 47 1 % of revenues 56.1% 57.3% (1) 3 Fixed selling costs (12) (11) (1) Fixed operating costs (30) (29) 3 W.04 Op. result Overheads (4) (4) Operating result 0 3 % of revenues 0% 3.6% * Including interzone revenues

  14. Analysis of results in America (in millions of euros) Like-for-like Reported W.03 Op. result 2 Winter 03 Winter 04 Revenues * 167 164 • Change impact • Volume impact America / AmericaEurope / America • Mix/Price • Others (1) 2 Margin on var. costs 98 99 4 % of revenues 58.7% 60.4% (2) 10 Fixed selling costs (23) (21) (3) Fixed operating costs (70) (66) 10 W.04 Op. result Overheads (3) (2) Operating Result 2 10 % of revenues 1.2% 6.1% * Including interzone revenues

  15. Jet tours operating result (in millions of euros) Winter 02 Winter 03 Winter 04 119 Revenues 128 133 12.0 • Semi-net margin 15.0 15.7 10.1% % of revenues 11.7% 11.8% (14.2) • Other costs (14.8) (14.8) (2.2) Operating result 0.2 0.9

  16. Other activities operating result (in millions of euros) Operating result Winter 03 Winter 04 • Club Med Gym • Club Med World Paris • Club Med World Montreal 0 (1) (2) (1) (1) N/A

  17. Result statement Winter 03 Winter 04 (in millions of euros) Revenues 785 784 Operating result 12 32 Net financial expense (25) (22) Net income from equity companies 0 0 Net exceptional expense (21) (7) Taxes 10 (2) Goodwill amortization (4) (4) Minority interests (1) (1) Group net result (29) (4)

  18. Net financial expense (in millions of euros) Winter 03 Winter 04 Credit cards transaction fees (4) (4) Interest expense (13) (13) Others (2) (2) Net financial expense excl. change impact (19) (19) Realized & unrealized exchange gains & losses (6) (3) Net financial expense (25) (22) Cost of debt 5.3% 5.9% Average debt 494 454

  19. Result statement Winter 03 Winter 04 (in millions of euros) Revenues 785 784 Operating result 12 32 Net financial expense (25) (22) Net income from equity companies 0 0 Net exceptional expense (21) (7) Taxes 10 (2) Goodwill amortization (4) (4) Minority interests (1) (1) Group net result (29) (4)

  20. Balance sheet 04/30/03 04/30/04 04/30/03 04/30/04 (in millions of euros) Fixed assets • Tangible assets • Intangible assets • Financial assets Shareholders equity& minority interests 568 475 901 773 73 66 Provisions 211 189 98 94 159 129 Working capital (1) Total fixed assets 1,210 1,056 436 424 Net financial debt Net deferred taxes 26 38 TOTAL LIABILITIES 1,236 1,094 TOTAL ASSETS 1,236 1,094 Gearing 77.0% 89.3% (1) At 04/30/02 working capital was €127 m

  21. Cash flow statement (in millions of euros) Winter 03 Winter 04 Cash flow (10) 28 Change in working capital (4) (50) Change in provisions 4 0 Funds from operating activities (10) (22) Investments (40) (44) Disposals and others 44 33 Free Cash Flow (6) (33) Change impact and others (9) (2) Cash variation (15) (35)

  22. Outlookfor summer 2004

  23. Summer 2004 • Capacity by zone: Sum. 03 Sum. 04 Variation (in thousands of HD) 5,705 5,867 Europe Asia America +2.8% -2.6% 987 961 -13.6% 1,675 1,447 8,367 8,275 -1.1% TOTAL WORLDWIDE

  24. Summer 2004 • Capacity by category: Sum. 02 Sum. 04 Sum. 03 (capacity in %) 2 Tridents 3 Tridents 4 Tridents Cruise ships & villas 27% 18% 21% 57% 63% 59% 14% 18% 18% 2% 1% 2% TOTAL 100% 100% 100% Further improvment in the product mix

  25. Summer 2004 • Summer 2004 bookings (vs summer 2003), at May 29, 2004 Cumulative,at May 29, 2004 Over the last four weeks Like-for-like revenues -9.3% Europe -2.1% +5.6% America +29.1% +63.2% Asia +34.7% +2.4% Total Club Med -1.6% +5.2% Jet tours +4.4%

  26. The benefitsof moving up market

  27. The benefits of moving up market • A village portfolio now ready to move upmarket 1998 2003 2005 % huts and 2T 34% 19% 9% % 3 and 4T villages 66% 81% 91% In number of beds A clarified, consistent offering

  28. The benefits of moving up market • A profitable business model, value-driven instead of volume-driven € Village profits Selling price Costs Very satisfied GMs(basis 100 index) 100 117 148 Comfort level 3  4  2  An upmarket strategy,combinig high margins and satisfied customers

  29. The benefits of moving up market The Club Med brand: the basis of an intense customer relationship • The higher people move uprange, the more they are attached to the brand • A very high percentage of customers say they’ll come back: 85% • The more demanding the customers, the stronger their attachment A strong brand that creates high expectations (Source: Sorgem Fonds de Marque – France, Italy, USA – January 2004)

  30. The benefits of moving up market • The strength of the Club Med brand: the example of France Criteria for choosing a vacation club Club Medcustomers Competitioncustomers • Reputation 43% (no.1) 21% (no.4) • Destinations 35% (no.2) 37% (no.2) • Type of stay 21% (no.3) 10% (no.6) • Organization 20% (no.4) 17% (no.5) • Activities 19% (no.5) 6% (no.7) • Price 16% (no.6) 44% (no.1) Club Med, a differentiated positioning (Source: U&A NFO Sofres – France, Summer Villages – February 2004)

  31. What will Club Medbe like tomorrow?

  32. Clear, identified expectations Vacations are critically important for our current and potential customers • Substantial financial investment: 1 month of salary (France) • Psychological investment: - a time of sharing for families- just one week of vacation (USA) • An investment indicative of social status (Italy) Vacations are « a rare occasion, when quality counts »

  33. Clear, identified expectations Expectations of customers who like Club vacations More human, more personal style • More personalization • More services and organizational flexibility More innovation and higher quality • More innovative activities • Greater balance between sports and cultural/artistic activities More open to and integrated into the local environment • A club that’s more open to the outside world • Also, the local culture is better integrated inside the Club (Source: NFO Extra Tout Compris study – France, Italy, Netherlands – July 2003)

  34. What will Club Med be like tomorrow? Club Med, a unique positioning « FRIENDLY UPMARKET »

  35. What will Club Med be like tomorrow? Moving the village portfolio faster upmarket in 04/05 • Cherating Beach: upgraded from 3 to 4 Tridents • El Gouna: opening as a 3 Tridents • Marrakech: - opening of la Palmeraie as a 4 Tridents - Médina upgraded from 3 to 4 tridents - creation of Riad • Sant’ Ambrogio: upgraded from 2 to 3 Tridents • Coral Beach: reopening after top-to-bottom renovation • Turquoise: rooms renovated – village center redecorated • Chamonix: upgraded from 3 to 4 Tridents • Val d’Isère: entirely restyled 4 Tridents • Pesey Nancroix: opening as a 4 Tridents A strategic evolution of Club Med to upmarket

  36. What will Club Med be like tomorrow? • Heading for incomparable… • Three-year marketing agreement with Star Airlines: - Highly quality standards, - personalized service, - modular purchase of a volume of hours, - exclusive airports package. • Revamping purchasing process: - target of around €30 million in 2006, partially reinvested in customer services • Motivated GOs: going upmarket is everybody’s business … a comprehensive approach to moving upmarket

  37. Conclusion By being the uncontested leader in friendly upmarket all-inclusive vacations, with a profitable business model, the strategy of moving upmarket has redefined an incomparable Club Med that creates value …a confirmed target: around 100 million euros in operating income in 2006

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