Naked Brand Group Limited Enters into Non-Binding Letter of Intent to Acquire a Leading U.S. Online Women's Retailer

Transaction, If Consummated, Would Combine the Retailer's E-Commerce Platform with Naked's Proprietary Digital Operating Platform Generating Total Projected E-Commerce Annual Revenue of Approximately $70 Million 

Combination Expected to Enhance Distribution for Naked Brand Group's Brands & Product Lines

SYDNEY, Sept. 06, 2018 (GLOBE NEWSWIRE) -- Naked Brand Group Limited NAKD (the "Company" or "Naked"), a global leader in intimate apparel and swimwear, has entered into a non-binding letter of intent to acquire a leading U.S. online retailer (the "Retailer") of women's apparel. The purchase price under the transaction is expected to be US$42.5 million, which would include cash, stock and assumption of approximately $6.1 million of the retailer's debt.

Combined with Naked's existing Frederick's of Hollywood e-Commerce license revenue, which has grown 36% in the last 12 months, a successful closing of this acquisition is expected to take Naked's projected e-Commerce revenues in excess of US$70 million for FY2019. Including integration synergies, management expects the combined e-Commerce business to generate a projected EBITDA contribution of US$11.3 million and projected net income of US$5.3 million for FY2019. Projections for revenue are based on an assumption of approximately 26% year-over-year revenue growth for Frederick's of Hollywood and minimal growth assumed for the retailer's business.

The prospective acquisition represents an integral component of Naked's major focus on expanding the Company's direct to consumer product and brand mix. If the transaction is consummated, e-Commerce would represent approximately 43% of projected group revenues, with overall direct to consumer channels (including owned retail and outlet stores) reaching 70% of projected revenue contribution, for FY2019.

The intimate apparel industry in the United States is expected to grow to US$250 billion by 2022.

"We are continuing to make strides in our digital and e-Commerce focused strategy that we believe will accelerate our growth trajectory and drive meaningful EBITDA contribution in FY2019," said Justin Davis-Rice, Chief Executive Officer of Naked Brand Group Limited. "The acquisition would augment our proprietary digital operating platform to create ongoing synergies that we believe will produce over $70 million in e-Commerce revenues in the United States for FY2019 and will be accretive to Naked shareholders over the long term," concluded Davis-Rice.

The letter of intent is non-binding and the Company has not entered into a definitive agreement for the proposed transaction. Accordingly, there can be no assurance that the transaction will occur. The proposed transaction is subject to negotiating the terms of, and executing, a definitive agreement relating to the proposed transaction and obtaining and satisfying all other necessary closing conditions.  Furthermore, the terms of the transaction are still subject to discussion and may be changed as a result of any material positive or adverse change to the business of either party. Accordingly, there can be no assurance that a transaction will be entered into or that the proposed transaction will be consummated on the terms described in this press release or at all.

About Naked Brand Group Limited:
Naked Brand Group Limited (NASDAQ:NAKD) is a leading intimate apparel and swimwear company with a diverse portfolio of brands. The company designs, manufactures and markets a portfolio of 11 company-owned and licensed brands, catering to a broad cross-section of consumers and market segments. Brands include Naked, Bendon, Bendon Man, Davenport, Fayreform, Hickory, Lovable, Pleasure State, Heidi Klum Intimates, Heidi Klum Man, Heidi Klum Swim. Naked Brand Group Limited products are available in 44 countries worldwide through 6,000 retail doors, a growing network of E-commerce sites and 61 company-owned Bendon retail and outlet stores in Australia and New Zealand. Brands are distributed through premier department stores, specialty stores, independent boutiques and third-party e-commerce sites globally, including Macy's, Nordstrom, Saks Fifth Avenue, Harrods, Selfridges, Amazon and ASOS among others. For more information please visit  www.nakedbrands.com.

Non-IFRS and Non-GAAP Financial Measures:
This press release includes "non-IFRS financial measures" and "non-GAAP financial measures", that is, financial measures that either exclude or include amounts that are not excluded or included in the most directly comparable measure calculated and presented in accordance with IFRS or US GAAP as applicable. Specifically, we make use of the non-IFRS and non-GAAP financial measure "EBITDA".

EBITDA is defined as earnings before interest, taxes, depreciation, depletion, amortization and impairment. Our management uses EBITDA as a measure of our operating results and considers it to be a meaningful supplement to net income (the closest IFRS and US GAAP financial measure) as a performance measurement, primarily because we incur significant depreciation and depletion and the exclusion of impairment losses in EBITDA eliminates the non-cash impact.

EBITDA is used by investors and analysts for the purpose of valuing an issuer. The intent of EBITDA is to provide additional useful information to investors and the measure does not have any standardized meaning under IFRS or US GAAP. Accordingly, this measure should not be considered in isolation or used in substitute for measures of performance prepared in accordance with IFRS or US GAAP. Other companies may calculate EBITDA differently.

The following table reconciles the pro forma projected combined e-Commerce business EBITDA to net income for FY2019. The pro forma projected combined EBITDA and net income are based on management's best estimates of, among other things, the level of debt attributable to the combined e-Commerce business.

Forward-Looking Statements:
This communication contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not historical facts. Such statements may be, but need not be, identified by words such as "may," "believe," "anticipate," "could," "should," "intend," "plan," "will," "aim(s)," "can," "would," "expect(s)," "estimate(s)," "project(s)," "forecast(s)," "positioned," "approximately," "potential," "goal," "pro forma," "strategy," "outlook" and similar expressions. Examples of forward-looking statements include, among other things, statements regarding future financial performance, annualized financial performance, future growth in our business, trends in our industry, product innovation, acquisition synergies and efficiencies, and operational expansion. All such forward-looking statements are based on management's current beliefs, expectations and assumptions, and are subject to risks, uncertainties and other factors that could cause actual results to differ materially from the results expressed or implied in this communication. Among the key factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements are the following: our ability to execute a definitive agreement with the Retailer when expected or at all; the possibility that there are changes or delays in the structure or timing of the proposed transaction between Naked and the Retailer; our ability to integrate the operations of the Retailer, the Frederick's of Hollywood business and Naked Brand Group Inc.; the risk that the projected value creation and efficiencies from the transactions with the Retailer, the Frederick's of Hollywood business and Naked Brand Group Inc. will not be realized; difficulties in maintaining customer, supplier, employee, operational and strategic relationships; the possibility that a robust market for Naked's shares may not develop; our ability to raise additional financing; our ability to anticipate consumer preferences; and the other risks and uncertainties set forth under "Risk Factors" in our Annual Report on Form 20-F for the fiscal year ended January 31, 2018. Further, investors should keep in mind that our revenue and profits can fluctuate materially depending on many factors. Accordingly, our revenue and profits in any particular fiscal period may not be indicative of future results. We are under no obligation to, and expressly disclaim any obligation to, update or alter our forward-looking statements, whether as a result of new information, future events, changes in assumptions or otherwise, except as required by law.

The financial information of the Retailer incorporated in the projected pro forma financial information contained herein was prepared by the Retailer as a private company and does not conform to SEC Regulation S-X. Accordingly, such information may be adjusted and presented differently when included in future filings with the SEC and/or when consolidated in Naked's financial statements.

Investors Relations:
Naked Brand Group Limited
Joel Primus
joel@thenakedshop.com

MZ North America
Chris Tyson
949-491-8235
chris.tyson@mzgroup.us