Agenda CDM growth workshop

1. Country/Region view on current CDM business situation Current overall market situation (including competition) Business development per channel (OEM / Whs) Business development per key account (OEM / Whs) Business development per key end-user Growth per CDM product type per channel (CDM-T, CDM-T Elite, CDM-TC, CDM-TC Elite, CDM-TD, CDM-Tm, CDM-R) Preparation proposal Country Marketing mgr Country channel mgrs Country channel mgrs Country segment mgr Country channel mgrs

2.

CDM value proposition and strategy MASTERColour CDM and MASTERColour CDM Elite Competitor benchmark CDM innovations 2009 CDM future strategy Corn Bob / Grace Bob / Grace Dominiek

3.

Workshop: top-3 actions to get CDM growth back on track Top-3 actions per country Top-3 actions HQ/SG all

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Philips Lighting

MASTERColour CDM value propositions

CDM growth workshops October/November 2008

Contents
MASTERColour CDM History of meaningful innovations Strengths and design choices MASTERColour CDM value proposition MASTERColour CDM Elite value proposition MASTERColour CDM-Tm value proposition MASTERColour CDM-Rm value proposition

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MASTERColour CDM

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MASTER Colour CDM

Philips has demonstrated continuous innovations in MASTER Colour CDM:
1994 1994 1995 1995 1996 1997 1998 2000 2001 2003 2003 2003 2004 2005 2005 2008 Breakthrough in CHID retail lighting: First ceramic CHID with CDM-T Uplamping with CDM-TD Easy to use with CDM-R Open luminaires possible with CDM-TP First 4200K with CDM-T Miniaturisation with CDM-Tc Outdoor with CDM-TT Outdoor/Indoor high bay with CDM-ET Optical lighting with CDM-SA/R Reflector design with CDM R111 Outdoor with MASTER City White, CDO ET/TT Hot restrike for special lighting with Ceramic-ST Miniaturisation with CDM-Tm Most compact medium wattage with CDM-T 250W Breakthrough in light technical properties with CDM Elite Breakthrough in light technical properties with CDM Elite MW

Philips has vital patents on ceramic lamp technology

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MASTERColour CDM strengths & design choices

All Philips MASTERColour propositions have 3 core values that we will never compromise in new lamp design: Color stability during life Lifetime reliability Safety (EOL)
Philips CDM 70W Other lamp supplier 70W

11000

12000

14000

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Life time (h)

10000

15000
6

1000

2000

4000

5000

3000

6000

7000

8000

9000

100

3200 3150 3100 3050 3000 2950 2900 2850 2800

Tc (K)

MASTERColour CDM Lifetime reliability

Philips MASTERColour CDM: 14 years of experience

Philips publishes differentiated survival curves per type. Experience matters for lifetime reliability improvement Increasing manufacturing control: salt dosing, mechanical positioning of components, in-line quality inspection systems Gaining fundamental knowledge on failure mechanisms and resolving them: salt chemistry, ceramic technology, electrode optimisation, etc.

2006 increase in lifetime reliability

100,0% CDM-T 70W 90,0% 80,0% 70,0% 60,0% 50,0%
0 2000 4000 6000 8000 10000 12000

survivals survivals improved

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System strength
Development of CDM lamps and gear is in one hand. Every product is tested extensively, requiring a million burning hours before a system can be released. The result is an optimal light performance with Philips MASTERColour CDM lamps. Testing is done at strict performance regulations, which go beyond any formal IEC/ANSI norms, the strict Philips test and performance norms for system release lead to the excellent and guaranteed Philips MASTERColour CDM performance.

For optimal system performance we recommend to use Philips HID PrimaVision Gear.

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MASTERColour CDM value Proposition summary

Excellent light quality with proven track record

White crisp light with excellent colour stability Ra > 80 in 3000K, >90 in 4000K High lumen output Low cost of ownership 60% saving versus Halogen Excellent lifetime reliability Sustainability Very efficient light source for shop lighting Versus halogen long life and low energy use
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MASTERColour CDM testimonials

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MASTERColour CDM Elite

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MASTERColour CDM Elite value proposition at a glance

MASTERColour CDM Elite has two value angles:

1. Quality of light: make your shop irresistible, season after season! CRI of 90 Higher lumen output Excellent lumen maintenance
What does this mean? The color representation of the Retailers merchandize (clothing, shoes, leather, furniture) as well as the ambience of the shop strongly improve (due to the improved CRI and lumen output). Not only at initial installation, but also after 1, 2 or 3 years, really until the moment of re-lamping as a result of the excellent lumen maintenance and consistent color performance during lifetime.

2. Total Cost of Ownership: lowest TCO with CDM lamps possible Higher lumen output and thus better Lumen/Watt ratio Excellent lumen maintenance Excellent lifetime reliability
What does this mean? Less luminaires required to arrive at the same average lux levels during lifetime of the lamp (due to the higher lumen output and improved lumen maintenance). Lower maintenance cost due to the excellent lifetime reliability and excellent lumen maintenance (longer lamp replacement period cycles)

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MASTERColour CDM Elite specification

Premium solution for Fashion Retail, best offer to: - enhance merchandize - create ambience in the shop - maintain these during life

CDM Elite
Luminous flux (lm) Efficacy (lm/W) CRI Survival 50%, kh Survival 90%, kh Maintenance at 12kh 90% Maintenance point burning position

35W T/TC

70W T/TC

150W T

3500 90 90

12 9
80% 2800lm 4khrs 3200lm VBU/VBD +/- 60DEG **

7300 100 90 12 10 / 8 80% 5800lm 4khrs 6600lm universal

15000 100 90 12 10 80% 12000lm 4 khrs 13500 lm universal

** Universal burning under development (release October 2008) MASTERColour CDM Elite is for Electronic gear only
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MASTERColour CDM MASTERColour CDM Elite

70W/3000K
Lumen Output Efficacy CRI Life 50% Maintenance 12k Maintenance 90% Service life 80%

MASTERColour CDM T/TC 6600 93 84 / 83 12 / 10 61% 1 kh 3 kh

MASTERColour CDM Elite T/TC 7300 100 90 12 80% 4 kh 9 / 7 kh

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Breakthrough in lumen maintenance

100%

90%

Lumen maintenance

80%

70%

60%

50%

40% 0 2000 4000 6000 8000 10000 12000

Lifetime (hrs)

CDM-T/TC 35W/70W/150W 930Elite

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CDM-T/TC 35W/830
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CDM-T/TC 70W/830

CDM-T 150W/830
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What do you see?

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MASTERColour CDM lumen maintenance

8k burned
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new
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What do you see?

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MASTERColour CDM Elite lumen maintenance

8k burned
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new
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The visual impact of MASTERColour CDM Elite superior lumen maintenance

8k burned

new

8k burned

new

MASTERColour CDM
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MASTERColour CDM Elite

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Strong cost of ownership initial market

2

COO Comparison End-user

Lamp type Design Lumens Nr of luminairs in installation Nr of lamps per luminair Nr of gear per luminair Energy Consumption Operation hours / year Energy costs Euro/kWhr Service life 70% Gear Price end-user Lamp Price end-user Luminaires Price end-user Lamp replacement costs TOT INSTALATION COSTS : a. Energy costs per year b. Lamp costs per year c. Lamp replacement costs per year d. Costs for airco (consump.) e. Cost for airco investment / 10 Years f. Lums cost per year TOTAL COST OF INSTALLATION Total costs per lamp per year Total costs per lamp per year vs. CDM-T Total Savings vs. CDM-T INITIAL COSTS PER LUMINAIR: a. Lamp costs per luminair b. Gear costs per luminair Additional costs for remplace Total initial costs CDM-T 6600 100 1 1 70 4000 0.15 7000 42.00 18.00 250.00 4.00

INITIAL MARKET; Less luminaires

CDM-T Elite 7300 90 1 1 70 4000 0.15 10000 42.00 22.00 250.00 4.00

pieces

Watt hrs Euro hrs Euro

Euro

4,200.00 1,028.57 228.57 1,260.00 25,000.00 31,717.14 317.17

3,780.00 792.00 144.00 1,134.00 22,500.00 28,350.00 315.00 - 2.17 - 3,367.14

Euro Euro Euro

Euro Euro Euro

1,800.00 4,200.00 6,000.00

1,980.00 3,780.00 5,760.00 - 240.00 0.1

Euro Euro Euro

Pay-back time vs. CDM-T

Year

Payback in less than 6 months (10% less luminaires)

TCO story based upon 10% less lums and energy saving TCO story based upon slightly more lums and move from 70W CDM 35W Elite: energy saving TCO story replacement market; payback 2 yrs based upon postponed relamping due to strong maintenance
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MASTERColour CDM Elite; external endorsement

5 stars rating Lighting Equipment News February 2008 issue

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Many retailers invest in MASTERColour CDM Elite

-C&A in Germany -Adidas Moscow Russia -Catimini France -Edeka Germany -Deichman Germany -Mamas&Papas UK -Pimkie Germany -Didi Netherlands -House of Fraser UK -DM Drug Stores Germany -Brice France -Benetton Germany -Magazin Z France - Diesel global contract - RLFD Amsterdam
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-and many more

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MASTERColour CDM Elite Value Proposition summary

Superior quality of light: make the shop irresistible and keep it that way

Superior ambience creation Ra > 90 in 3000K Highest lumen output and lumen maintenance Lowest cost of ownership Up to 100 lm/W Superior lumen maintenance Excellent lifetime reliability Sustainability Most efficient light source for shop lighting longer service lifetime Save energy, save money, save the environment
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Philips MASTERColour CDM Mini

Doubling your options for thinking small

Moving forward to make things smaller

Philips MASTER Colour Sparkling light Energy efficient Less heat, long life

Philips MASTERColour Mini 20W & 35W

Miniaturisation 50% Smaller system Less clutter in the ceiling Smaller Fixture design

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More possibilities across more applications

20W & 35W - Display lighting - Spot and track lighting - Down lighting - Mini floodlighting - Indoor / Outdoor Lighting differentiation - Miniaturization with CDM based accent lighting - Save up to 70% on energy consumption compared with halogen

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Making the choice easy

Easy: Lamps and Gear have same sizes

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Making the choice easy

-50%
90 mm 140 mm

Easy: Smallest Lamps and Gear of their category

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Making the choice easy

Quick installation & re-lamping Accurate positioning in reflector

Easy: Twist and Lock

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Proven reliability: realized projects

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Lamp Technical Specifications

20W/830

35W/930

Light Output Colour Temperature Colour rendering: Proven lifetime:

1650lm 3000K Ra85 12,000hrs

Light Output Colour Temperature Colour Rendering Lifetime (launch) Design lifetime
* Proven lifetime at launch (May 2007)

3000lm 3000K Ra90 6,000*hrs >9000hrs

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Philips MASTERColour CDM-R Mini summary

Miniaturization and ease of use Miniaturized CDM lamp For miniaturized new luminaire developments Easy to use and replace Excellent light quality Crisp white light Superior output and colour stability Excellent merchandise representation Sustainable choice Up to 60% energy saving per light point versus Halogen

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Philips MASTERColour CDM-R Mini

Add a sparkle to your lighting options

Add a sparkle to your lighting options

Philips MASTERColour CDM-R Mini 50mm reflector lamp Superior output and Colour stability

Philips MASTERColour Sparkling light Energy efficient Less heat, long life

Reflector Open luminaire Easy to use and replace

CDM performance
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Miniaturised reflector
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Applications
20W and 35W Display lighting Spot and track lighting Downlighting Mini floodlighting Indoor / Outdoor Lighting differentiation Miniaturisation with CDM based accent lighting Save up to 60% on energy consumption compared to halogen

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Making the choice easy

Quick installation and re-lamping Suitable for open luminaire Well accepted standard GX10 twist and lock system

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Lamp Technical Specification CDM-R Mini

20W/830 I max 10 I max 25 I max 40 Colour temperature Colour rendering Lifetime (50%) 13500 cd 3900 cd 1750 cd 3000K 85 9000 h

35W/930 I max 10 I max 25 I max 40 Colour temperature Colour rendering Lifetime (launch) 16500 cd 6500 cd 2800 cd 3000K 90 6000 h

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Features and benefits

Front lens protected MASTERColour Mini CDM-Tm burner 20W/830 and 35W/930 Pressed glass reflector, aluminium coating

Suitable for open luminaires Easy to install, easy to replace 100% compatible with existing GX10 compact HID systems High light output, low cost of ownership, less heat, sparkling white light, excellent colour rendering Easy and fast development of luminaire No additional reflector needed. Possibility to change beam angle by simply replacing the lamp
Philips Lighting

GX10 twist and lock lamp cap

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Philips MASTERColour CDM-R Mini

Miniaturisation and ease of use Miniaturised CDM reflector lamp Simple solution for new luminaire developments Easy to use and replace Excellent light quality Crisp white light Superior output and colour stability Excellent merchandise representation (Ra>85 for 20W, Ra=90 for 35W) Highest performance in a 50 mm reflector lamp Highest beam intensity Unique range of 20 and 35W Up to 60% energy saving per light point versus Halogen
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