4Q12 ResultsConference Call

February 22, 2013

DISCLAIMER

This presentation contains forward-looking statements regarding the

prospects of the business, estimates for operating and financial results, and

those regarding Cia. Hering's growth prospects. These are merely

projections and, as such, are based exclusively on the expectations of Cia.

Hering management concerning the future of the business and its continued

access to capital to fund the Company’s business Plan. Such forward-looking

statements depend, substantially, on changes in market conditions,

government regulations, competitive pressures, the performance of the

Brazilian economy and the industry, among other factors and risks disclosed

in Cia. Hering’s filed disclosure documents and are, therefore, subject to

change without prior notice.

AGENDA

Highlights

4Q12 Operating Performance

Outlook

4

4Q12 and 2012 HIGHLIGHTS

Gross revenue of up 10.7% in the quarter and 8.9% in 2012;

Highlight to Hering Kids´ performance (sales growth of 43.0% in 4Q12 and 22.2% in the year.);

EBITDA of R$ 407.4 million in 2012 (+3.3%), with -1.8 p.p. change in EBITDA margin, which has

reached 27.3%;

Net Profit of R$ 311.0 in 2012 (+4.6).

Hering Store Chain:

83 store openings in 2012, with a network of 515 stores at the end of the year

Total sales of R$ 1,428.1 million in the year (+15.6% overall growth and -0.2% SSS growth);

New guidance for store openings – 592 by the end of 2013

Hering Kids:

Implementation of the stores network, with 22 openings in 2012.

Highlight to the franchises (+44.6%) and own stores (+83.5%) channels.

AGENDA

Highlights

4Q12 Operating Performance

Outlook

6

SALES PERFORMANCE

Gross sales reached R$ 1.8 billion in 2012, with sales growth of 10.7% and 8.9% in the

quarter and year, respectively.

Gross Revenue ( R$ million)

4Q11 4Q12 2011 2012

496.1 545.6

1,625.91,766.6

3.27.2

21.4

27.1

499.3552.8

1,647.3

1,793.7

26.7%

123.0%

8.6%

10.0%

8.6%

10.7%

Domestic Market

7

SALES PERFORMANCE (cont.)

Growth in Hering, Hering Kids and PUC brands in 4Q12 and 2012, with highlight to the performance of the Hering Kids brand (+43.0% and +22.2%, respectively).

Domestic Market ( R$ million)

R$ 1,351.6

R$ 141.5

R$ 97.0

+8.7%

R$ 142.3+22.2%

+13.1%

-1.1%

20122011R$ 1,243.0

R$ 125.0

R$ 98.0

R$ 116.4Hering77%

Hering Kids

8%

PUC

8%dzarm.5%

Other2%

Gross Revenues - %

2008 2009 2010 2011 2012

230276

347432

51559

74

78

76

78

2215

15

16

17

2

5

27

1

1

1

Hering Store Hering Kids PUC dzarm. Total Foreign Market

8

STORES CHAIN EVOLUTION

In the domestic market, the Company ended 2012 with 515 Hering Stores, 78 PUC, 27 Hering Kids and 1 dzarm. store.

311365

443

530

638

Target: 224(+6 stores)

Target: 273(+3 stores)

Target: 325(+22 stores)

Target: 418(+14 stores)

Target: 507(+8 stores)

Target: 25(+2 stores)

9

HERING STORE CHAIN PERFORMANCE

Slowdown in SSS growth to -0.2% in 4Q12 due to supply shortages in the stores and decline in the average price in December, with the year ending with SSS of -0.2%.

Hering Store Chain Performance 4Q11 4Q12 Chg. 2011 2012 Chg.

Number of Stores 432 515 19,2% 432 515 19,2%

Franchise 384 465 21,1% 384 465 21,1%

Owned 48 50 4,2% 48 50 4,2%

Sales (R$ thousand) (1) 461.680 530.637 14,9% 1.234.956 1.428.149 15,6%

Franchise 388.183 452.678 16,6% 1.033.495 1.218.306 17,9%

Owned 73.496 77.958 6,1% 201.461 209.842 4,2%

Same Store Sales growth (2) 8,2% -0,2% -8,4 p.p 12,7% -0,2% -12,9 p.p

Sales Area (m²) 57.507 70.899 23,3% 57.507 70.899 23,3%

Sales (R$ per m²) 8.200 7.572 -7,7% 24.361 22.234 -8,7%

Check-Outs 4.773.449 5.349.692 12,1% 12.646.638 14.332.499 13,3%

Units 10.263.807 11.730.932 14,3% 27.011.508 31.131.137 15,3%

Units per Check-Out 2,15 2,19 2,0% 2,14 2,17 1,7%

Average Sales Price (R$) 44,98 45,23 0,6% 45,72 45,88 0,3%

Average Sales Ticket (R$) 96,72 99,19 2,6% 97,65 99,64 2,0%(1) The amounts referred to the sales to final costumers. (sell out concept)(2) Compared to the same period of the previous year

10

GROSS PROFIT AND GROSS MARGIN

Gross margin declined by 4.7 p.p. in 4Q12 due to greater cost of freight and overtime work at the end of the year and devalued currency over imports.

4Q11 4Q12 2012 2011

208.2 212.1

655.9 679.2

51.9%

47.3%

49.5%

46.7%

51.0%

46.3%

48.5%

45.5%3.6%

1.9%

Gross Profit Gross Margin Cash Gross Margin

-2.8 p.p.

-4.6 p.p.

-4.7 p.p.

-3.0 p.p

11

EBITDA AND EBITDA MARGIN

Decline of 3.8 p.p. in the EBITDA margin as a function of gross margin loss, growth of sales, general and administrative expenses and reduction in other operating revenues, being partially compensated by profit sharing reduction.

4Q11 4Q12 2011 2012

133.8 133.0

394.5 407.4

3.3%

-0.6%

32.8%29.0%

29.1%27.3%

EBITDA Divisão

-3.8 p.p.-1.8 p.p.

12

NET PROFIT

Net profit decline of 4.0% with net margin loss of 3.7 p.p. in 4Q12 as a result of reduction in EBITDA margin and financial revenues, despite lower charges of income tax and social contribution.

4Q11 4Q12 2011 2012

105.2 101.0

297.3 311.0

4.6%

-4.0%

25.8%

22.1% 22.0% 20.9%

Net Income Divisão

-3.7 p.p.

-1.1 p.p.

13

CAPEX

Capex in 4Q12 totaled R$ 23.9 million of which the largest part was destined to the industrial area (R$ 12.3 million), with specific additions to the productive capacity, and IT infrastructure (R$ 8.8 million).

By Activity ( R$ million)

4Q11 4Q12 2011 2012

7.212.3

22.3

33.4

7.3

8.8

13.4

22.3

1.2

0.3

1.7

1.8

2.8

2.5

10.1

6.0

18.6

23.9

47.5

63.5

33.7%

29.2%

Industry IT

14

CASH FLOW

Reduction of R$ 76.9 million in free cash flow in 4Q12, as a function of the decline in EBITDA combined to higher necessity of investments in working capital, mainly due to the reduction in taxes payable and lower provision of profit sharing.

* Dividend distribution: R$ 119.9 million have been destined to a proposed account to be distributed upon General Shareholders’ Meeting approval.

Cash Flow - Consolidated (R$ thousand) 4Q11 4Q12 Chg. 2011 2012 Chg.

EBITDA 133,808 132,982 (826) 394,464 407,396 12,932

Non cash items 680 1,680 1,000 2,322 4,236 1,914

Current Income tax and Social Contribution (35,814) (33,340) 2,474 (100,840) (95,911) 4,929

Working Capital Investment (21,162) (95,442) (74,280) (58,470) (43,506) 14,964

Decrease in trade accounts receivable (71,447) (106,716) (35,269) (66,445) (67,615) (1,170)

Decrease (increase) in inventories 5,747 7,352 1,605 (26,965) 6,361 33,326

Increase (decrease) in accounts payable to suppliers 13,118 5,627 (7,491) 2,088 30,130 28,042

Increase (decrease) in taxes payable 20,884 (248) (21,132) 36,911 (16,895) (53,806)

Others 10,536 (1,457) (11,993) (4,059) 4,513 8,572

CapEx (18,606) (23,893) (5,287) (47,501) (63,489) (15,988)

Free Cash Flow 58,906 (18,013) (76,919) 189,975 208,726 18,751

Reconciliation from accounting Cash flow to adjusted Cash flow (R$ thousand) 4Q11 4Q12 Chg. 2011 2012 Chg.

CFS - Cash provided by operating activities (accounting) 87,629 13,601 (74,028) 267,341 309,731 42,390

Adjustment – Financial items allocated to operating cash (10,117) (7,721) 2,396 (29,865) (37,516) (7,651)

Unrealized exchange and monetary variation (966) (540) 426 (4,679) (2,803) 1,876

Financial Result (10,193) (7,727) 2,466 (29,696) (37,339) (7,643)

Interest paid on loans 1,042 546 (496) 4,510 2,626 (1,884)

CFS - Cash flow from investing activities (18,606) (23,893) (5,287) (47,501) (63,489) (15,988)

Free Cash Flow 58,906 (18,013) (76,919) 189,975 208,726 18,751

AGENDA

Highlights

4Q12 Operating Performance

Outlook

16

OUTLOOK

Optmistic perspectives for 2013, with scenario indicating improvement signals and positive

results from the vacation and fall showrooms.

Potential of organic growth, although in moderate levels compared to previous years

Adjustments in prices and less markdowns should benefit gross margins

Reduction of fiscal incentives over imports and normalization of the profit sharing will

hamper EBITDA margin expansion

Hering Brand remains the main growth platform of the Company:

Stores opening (guidance of 77 in 2013) and revamping of SSS growth in Hering Store.

Multi-brand channel: Increase in market share within existing clients.

Children’s market:

Expansion of the Hering Kids format – opening of 30 new stores in 2013.

Adjustments in dzarm.´s management structure combined with additional investments in the

opening of more flagship stores and marketing.

New infrastructure of technology and logistics for online sales implemented in 2012 will

allow capturing the high growth potential of this channel.

INVESTOR RELATIONS TEAM

Fabio Hering – CEOFrederico Oldani – CFO and IRO

Patrícia Salem – IR ManagerDaniel Popovich – IR Analyst

Tel. +55 (11) 3371-4867E-mail: ri@hering.com.br

Website: www.ciahering.com.br/ri