2. Outline www.us.kohler.com
History
Communication
Financials
Past acquisitions
Current and planned industrial presence
The product ranges
Kohler and it’s competitors
SWOT
Strategy

3. Outline History Communication Financials Past acquisitions
Current and planned industrial presence
The product ranges
Kohler and it’s competitors
SWOT
Strategy

4. Kohler history in detail: industry + product development
Toilets
wash-
basins
of vitreous
china
Enters
electric
generator
market
Kohler
foundet
First
enamel
bath
tub
One-piece
built-in
bath-tub
Brass
faucets
Starts
manufact. faucets +
brass
accessories
Electric
kitchen
sink
Complete
bathroom
sets
with
matching
colours
1873
1883
1911
1920
1925
1926
1927
1870
1880
1900
1920
1930

5. Kohler history in detail: industry + product development
100
anni-
versary
Sales by
1 m $
Sales by
2 m $
rapid
expansion
Acqui. of
1st
Furnit.
Comp.
Vitreous
china
plant
opens
in MEX
Acqui. of
Sterling
Faucets
Joint
Venture in
China
New
colours
for
plumbing
fixtures
„Bold
look of
Kohler“
ad theme
Investm.
in cast
iron
product.
facilities
The 1990ties
Master suite concept
Product design
Innov. toilet and showers
Luxury whirlpool bath
1965
1965
1971
1973
1984
1986
1987
1991
1995
1996 60 70 80 90 00

6. Communication

7. The four seasons of Kohler´s brand awakening
Introduction of functional and technical innovations (bath, kitchen)
Establishing Kohler as a full-line manufacturer of bath products
Concern for aesthetics and manufacturing improvement
The Bold Look
of Kohler
Art, Inno-
vation, Life
Internal and
external growth
Form and Function
1960´s
1990´s

8. The four seasons of Kohler´s brand awakening
Launch of exciting, new plumbing products in vivid accent colors with
significant advertising campaign titled „THE BOLD LOOK OF KOHLER“
Campaign also solidifies Kohler´s culture and attitude (inside company)
Further lines followed:
- Whirlpool baths in an array of shapes and sizes
- Big kitchen sinks for big homes, and compact models for small apartments
- Lightweight, easy to clean fiberglass shower modules
- Faucets with interchangeable handle inserts
The Bold Look
of Kohler
Art, Inno-
vation, Life
Internal and
external growth
Form and Function
1960´s
1990´s

9. The Bold Look of Kohler adv campaign

10. The four seasons of Kohler´s brand awakening
As consumers spend more quality time at home, Kohler continues to
meet these needs with a fresh design approach
Kohler answers the trend towards increased luxury with it´s Master Suite Concept
answers trend towards increased luxury (console tables + bath vanities +
bedroom furnishings)
Electronics and other technological improvement as for example:
- stylish toilets
- faucets
- water saving shower heads
- innovative showering products and luxury whirlpools
Decorative fixtures, textured surfaces and expressive colors
The Bold Look
of Kohler
Art, Inno-
vation, Life
Internal and
external growth
Form and Function
1960´s
1990´s

11. The four seasons of Kohler´s brand awakening
In 1984, Kohler starts an expansion program based on:
- internal growth with new materials, products and markets
- synergistic manufacturing facilities
- direct access to new markets.
Currently Kohler encompasses an extensive business worldwide in the field of
- plumbing products, cabinetry and tile
- under a variety of brands
The Bold Look
of Kohler
Art, Inno-
vation, Life
Internal and
external growth
Form and Function
1960´s
1990´s

12. products and services.“
Mission
Kohler
„Improving the level of
gracious living
for each person who
is touched by our
products and services.“

13. Communication Conclusions
Kohler focus on design:
improving the level of gracious living
Stylish, lifestyle-oriented
Kohler point out a high standard of quality and manufacturing know-how
that promotes to be innovative in terms of product design (colours, materials) and
aspects of comfort in the bathroom.
Kohler looks back at great advertising campaings
The Bold Look of Kohler

14. Outline Financials History Past acquisitions
Current and planned industrial presence
The product ranges
Kohler and it’s competitors
SWOT
Strategy

15. Turnover & Income statement
Estimated turnover 2005 : 3.1 Billion $ Estimated number of employees

16. Turnover 1997 by Group

17. Structure of Business Families

18. Outline Past acquisitions History Financials
Current and planned industrial presence
The product ranges
Kohler and it’s competitors
SWOT
Strategy

19. Acquisitions
France UK
Marocco US
Mexiko
New Zealand
Thailand
China *
India
1985
1993
1994
1995
1996
1998
1999
2000
2001
2002
2004
2005
2006
cws
taps
bathfurniture
wellness
csw
baths
furniture
tiles
taps
enclosure
showers
plumbing fixtures
kitchen
factory
tiles *
faucets, baths, whirlpools, lavatories, toilets,showers

20. Outline Current and planned industrial presence History Financials
Past acquisitions
Current and planned industrial presence
The product ranges
Kohler and it’s competitors
SWOT
Strategy

21. CSW production located all around the world
CSW production located all around the world. Weakness in Europe will be remedy with the new Russian factory

22. CSW production located in such a way, that allows a locally presence in our (future) markets, and at the same time assure an access to low-cost sourcing
14 production locations for CSW
Total capacities:
Europe: 1,9 mln pcs
World: 19,0 mln pcs
(New plants planned: MX, RU, IN=> >5 mpc)

23. Non CSW production covers all the product categories that are part of our strategy Industrial restructuration of non profitable operations in Europe already planned

24. Outline The product ranges History Financials Past acquisitions
Current and planned industrial presence
The product ranges
Kohler and it’s competitors
SWOT
Strategy

25. Overview Brands / Product fields
1989
1984
1985
2000
2002
2001
1873
1987
67%
Taps & Mixers
CSW
Bathtubs
Shower T
Furnitures
Tiles
Info about Karat uncompleted
Core business

26. Overview Brands / Price positioning
Prof.
middle
US - Canada
Europe / middle east
Asia / pacific
Price
Karat
upper
High end
Each brand is available through the regional Kohler sales manager

27. Brand architecture Core brand Regional brand Specialist brand Kohler
Main brand for worldwide use;
covers entire spectrum
Regional brand
Jacob Delafon (F,E)*
Englefield (AUS)
Karat (THAI)
Kallista* (US)
Sterling* (US)
Ann Sacks* (US)
*Regional brands with
complete offer
Specialist brand
Sanijura (F)
Mira (UK)
Daryl (UK)
Robern (US)
Local brands with
special offer

28. Kohler has long encouraged an ongoing dialogue with the art community
Kohler has long encouraged an ongoing dialogue with the art community. Kohler works with international designers and architects for:
product development (2006, launch of 3 Artists Editions ‘Top Art Collection’)
bathrooms arrangement, to show customers how a dream Bath from Kohler could appear (
in the Kohler Design Center in east central Wisconsin, where they offer educational seminar series, design services, showroms with current range and a museum

29. Kohler wants to be state-of-the-art.
Acquisitions of innovative companies (hightec, mira, etc.),
Launch of innovative products, that combine state-of-the-art design with innovative technologies and take care to save water (performance flush technology, urist mirror with faucet, C3 Toilet Seats)
Kohler offers end consumers many ideas and services to arrange their bathroom to a dream space for a higher level of gracious living.

30. - complete bath offer

31. - Product Overview
Offers complete bathrooms -15 bath collections with a clear focus on classic lifestyle, with the exeption of purist (2003) and the novelties 2006
Wide range of single lavatories and customizable products (51 decorated washbasins, modern washbasins, etc.), toilets, bidets, faucets, baths, furniture, kitchen sinks (171 models) etc.
Materials: vitreous china & fireclay, cast iron, glass, marble, stainless steel
Wide range of colours - up to 50 colours (depending on the material)
Price level: focus on mainstream and premium

32. - complete bath offer

33. - Product Overview
Designer products, 8 collections in 3 Lifestyles (city life,
country life, retro) for different target groups.
Wide but not deep product range: whirlpools/baths, lavatories, furniture, toilets, bidets, accessories, kitchen sinks.
Materials: ceramic, copper, etc.
Colours: 1 to 3 colours for a product, hand painted designs
Price level: premium to high ( USD per Lavatory)

34. - core business tiles & stones

35. - Product Overview
Assortment: focus on tiles, offers also stones, mosaics, plumbing, lighting and designer collections (like Kallista)
Materials: tiles from ceramic, glass, metal, leather, wood & concrete; basins from art glass, cast bronze, copper, stone, concrete, spun metal, vitreous china
Very wide colour range (depending on the material)
Price level: premium too high

36. - complete bath offer
Premium: 3 to maxi 13 models, mainstream: models, profi >40 models, each with international models as BTW close coupled WC-Suites
Furniture WB: 12 UC-BI WB in synthetics
Botticelli vessel lavatory in carrara marble (2211€), Spun Glas (1713€), Timpani in Inox (750€)
Specials for projects: sinks, Handylav, children fountain und tube, etc.
Kitchen sinks: 10 in ceramic, 7 in ‚cristogranit‘, 18 in ‚metaquarz‘ and 12 in inox
Prices in F: WB from (botticelli in carrara marble) to 34 € (60 cm Brive), Premium > €, Mainstream (530 to 1.100), Profi (320 to 530€), Eco (<320€)
usage of material is depending on the bath concept or the material characteristics / advantages. Each material is used for ist own material, if iron, synthetic, ceramic or else is used for

37. - Product Overview
15 bath collections in 4 lifestyles, mostly as complete offer (CSW, tube, shower tray, furniture, taps, accessories and front-wall elements) as well as a wide range of furniture washbasins, many specials for projects, 3 of the Kohler high end vessel lavatories and 47 kitchen sinks
Product ranges are made of the key models for European needs (product types, sizes) and offer in total a wide assortment of standard functions and standard shapes.
Wide range of offered materials pro productfield.
Wide range of colours (CSW 8 colours, tubes: from
18 to 37 colours, depending on material)
Price range from high end to professional
Premium: 3 to maxi 13 models, mainstream: models, profi >40 models, each with international models as BTW close coupled WC-Suites
Furniture WB: 12 UC-BI WB in synthetics
Botticelli vessel lavatory in carrara marble (2211€), Spun Glas (1713€), Timpani in Inox (750€)
Specials for projects: sinks, Handylav, children fountain und tube, etc.
Kitchen sinks: 10 in ceramic, 7 in ‚cristogranit‘, 18 in ‚metaquarz‘ and 12 in inox
Prices in F: WB from (botticelli in carrara marble) to 34 € (60 cm Brive), Premium > €, Mainstream (530 to 1.100), Profi (320 to 530€), Eco (<320€)
usage of material is depending on the bath concept or the material characteristics / advantages. Each material is used for ist own material, if iron, synthetic, ceramic or else is used for

38. - Showers, enclosures, trays, brassware
Mixing valves, accessories, pumps

39. - Product Overview
Deep shower systems range (electric, mixer, power, contract showers), shower enclosures and trays, brassware
Rada Controls offers the most extensive product range available, for hand washing, showering, bathing, urinal and industrial/commercial applications, including the widest range of UK Healthcare approved

40. - Bathtubs and Showers
Hydrolux® Air jet Systems
Hydrolux® Whirlpools

41. - Product Overview
Small assortment: only showers, baths, receptors tilewalls
Material: acrylic and gelcoat
17 Colours
Options: knockdown system, whirlpool, air jets, crab bar options, kits, fold-up seat, stainless steel curtain rod, removable headrest, extra reinforcement

42. - Product Overview
Toilet suites / Showers / Plain baths / SPA baths / Vanities

43. - Product Overview
Englefield - one of the two brands manufactured by Kohler Co. Australasia for both the Australian & New Zealand markets
Relative small assortment: no collections, single toilets (only pan - close - coupled), washbasins from vitreous china, plain baths, spa baths and vanities
Price level : low*
* assumption

44. - Product Overview
Bath / Shower moduls and doors / wirlpools, sinks, toilets
* < 100 USD / lavatory

45. - Product Overview
No collections, single brands for the different product lines
27 bath sinks from stainless steel, vikrell or vitreous china, 52 kitchen sinks
30 toilets (only pan - close - coupled)
discontinues faucet brands and recommends Kohler faucets
Focus on bath & shower modules / doors / receptors / kits : innovations for integrated storage shelves, quick install technology
small colour diversity
Price level: low* (lavatories for below 100 USD)
* < 100 USD / lavatory

46. Outline Kohler and it’s competitors History Financials
Past acquisitions
Current and planned industrial presence
The product ranges
Kohler and it’s competitors
SWOT
Strategy

47. As Kohler itself, most of our international competitors cover almost the entire spectrum of bathroom products
Legend: X = minor weight in sales of company
XX = medium weight in sales of company
XXX = great weight in sales of company
Source: Kohler research

48. Global presence of the main competitors in CSW (2004)
Kohler : Good presence in America, limited presence in Europe
100
200
300
400
500
Europe
Asia
America DE FR
UK/IE IT
BNL
Sca
ES/PT RU
Oth
EUR JP CN IN
Rest
S+OA US CA MX
S-Am
Size (m€)
278
320
378
350
102
165
253
173
372
475
702
186
>700
1.209
124
>240
Villeroy & Boch
American Standard
Duravit
Eczacibasi
Grohe
Inax
Jacuzzi brands
Kludi
Kohler
Masco
Roca
Sanitec
Toto
Legend:
Market share (volume): > 15%
Market share (volume): >2% - <5%
Market share (volume): >5% - <15%
Market share (volume): <2%
Ceramics
(incl. sinks and
showers)

49. On the world ranking list, we estimate that we rank #2
Total value as basis:
5,2 billion Euro (ASP)
Cisa AR 2003: 104 m$ = 92 m€ => BSRIA 1,8% correct
Crane: no data => BSRIA 2,9%
Inax: no data split => BSRIA (but with doubt: too low?) => 2,9%
Jacuzzi: competition file comes to 145 m€ => 3% is good hypothesis
V&B figures: total sales ceramics 2003 = 269,1 m€ => 5,2%
Toto: no data split => BSRIA (but with doubt: too low?) => 8,3%
Kohler: competition file comes to 350 m€ => BSRIA 460 m€ could account for upside USA + sales S-Am, Karat and China => 8,8%
Roca: competition file comes to 345 m€ for EU only => 8,7% would give 450 m€. With some m pcs outside Europe, this would give an ASP of only 10 € => sales of 500 m€ is more likely . Roca makes 50% of m€ in Bathroom. 500 m€ would give give share of 65% in total bathroom sales => 9,6%
Sanitec: competition file comes to 522 m€ plus 5% export => 550 m€ which would match sales from AR minus 10% for seats, etc => 10,6%
ASD: presentation indicates 1,4 mld$ = 1,25 mld€ for fixtures => 13% would give only 675 m€ for ceramics, or some 55%. With relative strength on ceramics 800 m€ or some 65% is more likely => 15,4%
World-wide shares of main suppliers of CSW* - year 2003; coverage ca. 80% of total world market
* V&B incl. Vitromex, Roca incl. acquisitions 2006
* Due to lacking data inclusive ceramic shower trays and kitchen sinks
Source: BSRIA - Consult - Kohler research

50. In Europe however we are still relatively weak at #6
Total value as basis:
2,2 billion Euro (ASP)
All data are present in reworked competition file. Although slight changes would be justified, the original data were close enough and were left in order to avoid confusion
Shares of the main supliers of CSW* in Europe - year
* Inclusive acquisitions of Roca 2006
*Ceramic Sanitaryware exclusive ceramic shower trays and kitchen sinks
Source: Consult and Kohler research

51. Outline SWOT (only Kohler team) History Financials Past acquisitions
Current and planned industrial presence
The product ranges
Kohler and it’s competitors
SWOT (only Kohler team)
Strategy

52. Strengths and Weaknesses
Internationality
Industrial and market presence in 3 continents
Strong presence in the US market in several bathroom product categories
Complete offer for the bathroom (and Interior Design competence)
including material diversification
WEAKNESSES
Limited international presence of core brand
Weak presence in Europe
Failure to enter the German market
No success in transferring ranges from one country to another (Delafon/F vs Kohler/D)
Specialist brands have only local presence (Mira, Sanijura)

53. Strengths and Weaknesses
Family owned company (long term objectives and outlook, less short term pressure)
Experience with acquisitions and investment minded
WEAKNESSES
Complexity of organisation
factories
brands
countries

54. Opportunities and Threats
Fast growth of the Asian market will benefit to the Kohler local presence
Ceramic acquisition or alliance in Europe
THREATS
Concentration in industry & trade

55. Outline Strategy (Current) History Financials Past acquisitions
Current and planned industrial presence
The product ranges
Kohler and it’s competitors
SWOT
Strategy (Current)

56. Current strategy Expansion of all kinds
Geographically (Markets and production facilities)
Asia : China, India, Thailand
America : Mexico and US
By product and material categories
for sourcing reasons

57. Current strategy
Reinforcing of the core Brand and establishing sub-brands to cover all market segments
Enlarge/improve the core brand Kohler
by taking control of the quality of our distribution in the US (Showroom programs . The Kohler Store) (US)
Art’s involvement (Product, communication)
Other brands:
Creation of Kallista and Ann Sacks as a luxury brand (US)
Be present in the lower segment with Sterling (US)
Use specialist brands (Europe/US)