1Q06 Results Presentation

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Legal Notice

This presentation contains forward-looking statements relating to the prospects of the business, estimates for operating and financial results, and those related to growth prospects of Submarino. These are merely projections and, as such, are based exclusively on the expectations of Submarino’s 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 Submarino’s filed disclosure documents and are, therefore, subject to change without prior notice.

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HighlightsFinancial Performance for 1Q06

Gross revenues up 56% q-o-q on active customer growth of 46% average ticket rising 5%. Excluding Reward Program, gross revenues up 47% q-o-q and average ticket rising 14%.EBITDA of R$11.1 million (9.8% of net sales), representing 38% growth over 1Q05. Excluding the impact of the Rewards Program, EBITDA was R$12.2 million (11.4 % of net sales), representing 50% growth over 1Q05.Net income of R$5.1 million, compared to net losses of R$3.2 million in 1Q05.

Follow-on Offering CompletedTotal deal size of R$929.0 million at an offering price of R$53.75. Approximately 40% of shares were placed with tech funds alongside strong participation from major current investors.Net proceeds for SUBA of R$275.7 million (including green shoe) and costs of R$15.7 million to appear in 2Q06.

Relocation to New WarehouseConcluded the move to our new warehousing facility ahead of schedule and with no disruptions to service quality and sales.

PersonalizationLaunched version 2.0 with new features.

New BusinessesCreated Submarino Finance and closed on transaction with Cetelem (BNP Paribas).Encouraging early results from Submarino Travel.

EBTIDA (earnings before tax, interests, depreciation, amortization and extraordinary expenses) is presented as additional information, since we believe that it is an important indicator of our operating performance, besides being useful for comparing our performance to other companies of the retailing industry. However, no figure should be individually taken into consideration as a substitute for the net income calculated according to either the US GAAP or the Brazilian Corporate Law, or even as profitability measure for the Company. Additionally, our calculations may not be comparable to other similar measures used by other companies

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Follow On Offer

Secondary: 11,861,784 shares (R$ 637.5 million)Primary: 5,423,368 shares (R$ 291.5 million)Net proceeds of R$ 275.7 million to be recognized in 2Q06Transaction fees of approximately R$ 15.7 million to be recognized in 2Q06

Offering Size(including greenshoe)

Pricing: April 12 Exercise of Green Shoe: April 27Transaction Dates

GP Investimentos and TH Lee Putnam Internet VenturesSelling Shareholders

97%Free Float after Offering

90 days for Issuer and ManagementLock-Up

Credit Suisse Goldman SachsBookrunners

Unibanco, Safra, Deutsche Bank, SantanderCo-Managers

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New Shareholding Structure

Pre Follow On Current Structure

Management + BOD

Int. Mutual Funds

Brazil Mutual Funds

Tech Funds

Brazil Hedge FundsOriginal

Investors

Int. Mutual Funds

Brazil Mutual Funds Tech. Funds

Brazil Hedge Funds

56%

18%

10%

13%

3%

51%

4%10%

6%

29%

(1)

(1) Original investors including GP Investimentos and THLee Putnan Internet Fund who invested in 1999 and 2000 as well as management.

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New Board Composition

Board of Directors CV’s of New Members

Augusto Cruz Filho: Financial officer of Friboi Ltda., one of Latin America’s largest beef companies. He joined our board on March 28, 2006. Prior to joining Friboi, he was a director and chief executive officer of Grupo Pão de Açúcar, a Brazilian wholesale company, a financial officer of Tintas Coral S.A. and Grupo Bunge Born, and a member of the board of directors of Arafértil ISF –Ipiranga Serrana de Fertilizantes. He holds a degree in economics from Universidade de São Paulo and graduate degree and PhD in economics from FEA-SP.

Guilherme Afonso Ferreira: Chief executive officer of Bahema, a Brazilian investment company. He joined our board on March 28, 2006. He serves on the board of directors of several companies, including Eternit, DHB and Unibanco Holdings, and is a member ofthe fiscal council of Santista Têxtil. Mr. Ferreira also is engaged in a variety of philanthropic activities. He is a director of Instituto de Cidadania Empresarial, Lar Escola São Francisco, Fundação Esporte Solidário and Instituto Ortopédico de Campinas. Guilherme Afonso holds a degree in production engineering from Escola Politécnica da Universidade de São Paulo.

Antonio Bonchristiano

Mauro Muratorio

Marcos Wetreich

Flávio Jansen

Augusto Cruz *

Guilherme Ferreira *

Martín Escobari *

(*) New Board member.

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Warehouse Relocation Complete

Timeline

• Signed lease contract on December 26, 2005

• Began to move on January 25, 2006

• During the Carnival holidays on February 24-27, 2006 we executed most of the move (including all our books, music and videos inventory)

• 100% complete on April 21, 2006

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Automation System to be Implemented

Update

• We selected Mostoles (Spain) and Distrisort (Holland) as our automation providers. Contract signed on March 24th

• The investment will be approximately R$ 4.0 MM• Expect to be fully operational by October

Automation Level• Batch picking separation per item• Physical inventory kept in areas by sales curve

(ABC - high, medium and low movers)• High movers SKU’s kept in flow racks shelves

and provided with central conveyors to move forward to the sorter equipment

• Automatically order sorting throw a 5,200 items-per-hour

• Solution is to process small and medium sized orders (approximately 88% of total orders –500x400x200 mm and less than 6kg)

Pictures illustrate systems similar to the ones contracted with our suppliers.

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Personalization Progress

“My Store”

• We have begun to see material effects from our personalization efforts via My Store (launched in January).

• We are now in version 2.0 which adds the ability for customers to ask not to have specific purchase be included in the suggestion engine, and customers to see why we are suggesting a particular product and give us feedback.

• We are actively soliciting input from our customers, and will use such input to continue to improve our suggestion engine.

“Wish List”

• New wish list launched in February. Functionality includes ability to create open or restricted lists, as well as multiple lists. This list also automatically identifies any products that you purchase at a later day. Users can also prioritize their wish list items. If users have more than one list, they can navigate and search across the lists and copy items across lists. You can also create comments for each product and share lists with friends via email.

• We currently have 290,000 wish lists.

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Customer Acquisition Strategies

Rewards Program • Results for 1Q06 were impacted by the Rewards Program, whereby a credit card company allowed its customers to cash in their rewards points to buy any product at Submarino.

• We estimated that 70% of the beneficiaries of such program had never bought online, and this program would encourage first timetrial and online adoption.

• More than 500,000 clients will receive such offer until 2Q06. Thus far more than 87,000 customers have cashed in their reward points with us. We expect approximately 150,000 customers to try our service using this service in 1S06.

• Even though we had acted as a fulfillment partner for other rewards programs, this program is the first time where all our products are eligible and where we furnished a 1-800 number to assist customers.

• We are continually innovating in how we build brand awareness and keep customer acquisition costs under control.

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Growth

154.799.0

360.9

211.7

129.676.6

574.2

2001 2002 2003 2004 2005 1Q05 1Q06

Average Ticket (R$)

Active Customer Base

206

1,481,850

Y/Y Growth Rate

69%

63%

70%

Gross Revenues (R$ MM)

59%

56%

1Q06 Growth

5%

46%

(1) Excluding impact of the Rewards Program.

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Gross Profit & Margin

As a % of Net RevenuesGross Profit (R$ MM)

24.4

44.1

75.4

116.7

21.132.2

14.5

2001 2002 2003 2004 2005 1Q05 1Q06

23.8%26.4% 27.3% 27.8% 29.1% 28.4%

23.3%

2001 2002 2003 2004 2005 1Q05 1Q06

69%

81%

71%

55%

53%

Y/Y Growth Rate

Operating Expenses

SG&A / Net RevenuesOperating Expenses

1.8%1.9%

1.5% 1.4%

1Q05 1Q06G&A D&A

16.0% 16.5%

1Q05 1Q06

Selling Expenses

G&A and D&A

Selling Expenses /Net Revenues

G&A Expenses / Net Revenues

49.2%

14.7%15.4%

21.5%

3.0%

14.0%

2.8%4.8%

(1)

(2)15.5%

1.5%3.6%

D&AExpenses / Net Revenues

4.0%1.9% 1.3% 1.2%

2001 2002 2003 2004 2005

(1) Reported G&A excluding the positive impact of R$ 1.7 M due to accounting changes.(2) General and Administrative expenses (G&A). Depreciation and amortization expenses (D&A). 13

EBITDA & EBITDA Margin

As a % of Net RevenuesEBITDA (R$ MM)

-0.9%

8.0% 9.6% 10.6% 11.2% 9.8%

-40%

2001 2002 2003 2004 2005 1Q05 1Q06

(0.9)

13.4

26.5

44.6

8.1 11.1

(25.0)2001 2002 2003 2004 2005 1Q05 1Q06

97%

68%

38%

11.4%

12.2

Excluding the impact of the Rewards Program.

Y/Y Growth Rate

EBTIDA (earnings before tax, interests, depreciation, amortization and extraordinary expenses) is presented as additional information, since we believe that it is an important indicator of our operating performance, besides being useful for comparing our performance to other companies of the retailing industry. However, no figure should be individually taken into consideration as a substitute for the net income calculated according to either the US GAAP or the Brazilian Corporate Law, or even as profitability measure for the Company. Additionally, our calculations may not be comparable to other similar measures used by other companies

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Balance SheetR$ MM

ASSETS LIABILITIES AND SHAREHOLDERS EQUITY

Current assets 03/31/2005 03/31/2006 Current liabilities 03/31/2005 03/31/2006

Cash and equivalents 36.9 28.4 Suppliers 42.3 61.2

Account receivables 113.7 195.3 Suppliers days * 74 71

Anticipations (21.2) (0.0) Salaries and social charges payable 3.3 3.2

Account receivable days (gross) * 103 114 Taxes payable 0.8 4.5

Other receivables 0.6 14.9 Loans and financing 68.7 0.5

Inventories 26.7 38.2 Taxes and social charges payable in installments - -

Inventory days * 47 42 Accounts payable 6.8 15.6

Prepaid expenses 1.4 0.5 Other accounts payable 3.7 24.9

158.0 277.3 125.5 109.9

Non-current assets Long-term liabilities

Related parties 1.5 - Loans and financing 9.2 0.3

Deferred charges 0.2 0.4 Taxes and social charges payable in installments - -

Other receivables 0.2 0.2 Provision for contingencies 0.1 0.1

1.9 0.6 9.3 0.4

Permanent assets Stockholders’ equity

Investment - 9.2 Capital 45.2 180.4

Property and equipment 10.3 15.3 Accumulated earnings (deficit) / legal provision (9.4) 5.8

Deferred charges 0.4 1.0 Earnings reserve - 6.9

10.7 25.5 35.8 193.1

Total assets 170.7 303.4 Total liabilities and stockholders’ equity 170.7 303.4

(*) Balance of account receivables, inventory or suppliers, as the end of the quarter divided by gross sales or COGS for the quarter. Account receivables days are gross of discounting of receivables.

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Key Metrics 1Q06

206,154 tickets R$1.1 million in gross revenuesR$279,000 in EBITDA187,000 active customers (12 months)

Increased Offering

Operating all ticketing services for Internacional Soccer Team in Porto Alegre (1 million tickets per year in 30 games).

Exclusive online distributor of Jack Johnson (Rio) at the Praça da Apoteose (Sambódromo)

Signed the Cuba Ballet and Shenyang Acrobatic Troupe of China using a merchant model. The events will be in 2Q06 and 3Q06.

Signed exclusive rights to sell online theater tickets with the leading chain of theaters in Rio and Sao Paulo (Teatros.Art) with 7 premises. We also negotiated a 1-year sponsorship which yield us discounts and media rights.

Submarino Ingresso

Sport Clube Internacional

China Nat. Circus

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Submarino Finance

• Submarino Finance (our joint venture with Cetelem) was incorporated, we closed on the transaction.

• Our cash and cash equivalent position for 1Q06 reflects an increase of R$77.2 million resulting from this transaction.

• We are working hard to launch the Submarino Card in 3Q06. On an ongoing basis we will report gross billings, EBITDA and active cards

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Submarino Travel to be Launched

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Service Partners Already Lined UpAirline• Brazil: TAM, GOL, VARIG

• International: around 450 Airlines Companies. Example: American Airlines, Delta Airlines, Continental Airlines, Aerolineas Argentinas, LAN, COPA, TAP, Iberia, Air Madrid, Air France, Alitalia, Lufthansa, KLM, British Airlines, QUANTAS, JAL

Hotels• Brazil: 530 hotels. Example: Accor Hotels, Atlantica Hotels, Blue Tree

• International: 55,000 hotels (30,000 Hot Rates and 25,000 Public Rates)

Packages• Brazil: CVC, Nascimento Turismo, Club Med Brasil, and others

• International: Nascimento Turismo, Fenix Turismo, New Age, Flytour Travel, CVC, Designer Tour

Cruises• Brazil: Island Cruises, Costa Cruzeiros, MSC Cruzeiros

• International: Royal Caribbean, Carnival Cruise Line, Norwegian Cruise Line, Celebrity Cruises

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Priorities for 2006

Growth and margin expansion

Capacity

Personalization

New businesses (finance, travel)