Bare Escentuals (BARE)

BARE, B-, 8

Mineral-based cosmetics

Post-IPO shrs:87mm

San Francisco, CA

2003

2004

2005

6mos June

IPO Mkt

Rev ($mm)

$95

$142

$259

$186

Cap (mm)

Gross Margin %

67%

72%

71%

72%

$1,914

Income ($mm)

$12

$4

$24

$25

@$22

Net income %

13%

3%

9%

13%

Interest expense

$2

$6

$22

$22

Interest exp % of net income

13%

158%

90%

88%

VALUATION RATIOS

IPO Mrkt

Price /

Price /

Price /

Price /

% offered

Cap (mm)

Sales

Earnings

BookValue

TangibleBV

in IPO

Bare Escentuals (BARE)

$1,914

5.1

38.3

-4.8

-3.5

12%

SCORECARD

Mgt

Market

Market Do-

Proprie-

Total

1-5, 5 is high

Growth

mination

tary

rating

20 is perfect

2

3

2

1

8

Compare & Contrast -- annualizing six months ended June 30, 2006

VALUATION RATIOS

IPO Mrkt

Price /

Price /

Price /

Price /

Price

Cap (mm)

Sales

Earnings

BookValue

TangibleBV

9/28/06

Bare Escentuals (BARE)

$1,914

5.1

38

-4.8

-4.8

$22.00

Alberto-Culver Co. (ACV)

$4,710

1.2

27

2.9

5.0

$50.50

Estee Lauder Companies (EL)

$8,480

1.9

41

5.2

9.3

$39.94

Avon Products Inc. (AVP)

$8,460

1.0

20

8.4

8.4

$16.00

Current ratio comparison

Growth % -- 6/30/06 vs 6/30/05

(current assets / current liabilities)

Sales

Net inc

Bare Escentuals (BARE)

1.9

+67%

+158%

Alberto-Culver Co. (ACV)

1.6

Estee Lauder Companies (EL)

1.5

Avon Products Inc. (AVP)

1.4

Summary

. Profitable, high gross margin, significant top line revenue growth, brand building momentum

. Business is diversified between wholesale, infomercials & retail

. Strong income statement, significant interest expense

. Highly leveraged: interest expense as a % of net income was 88% for the June 30 six months

. June 2004 leveraged buyout, stockholders since then have paid themselves $645mm in dividends,

and the entire use of proceeds is to repay debt

. Weak balance sheet with a negative book value

Business

. One of the fastest growing prestige beauty companies in the U.S. and a leader by sales and

consumer awareness in mineral-based cosmetics, including skin care, and body care products

under the BARE i.d. bareMinerals, i.d., RareMinerals and namesake Bare Escentuals brands, and

professional skin care products under the md formulations brand.

Segments, based on six months ended July 2, 2006

. Wholesale, 53.5%

. Retail, 13%

. Infomercials, 33.5%

Differentiated

. BARE believes its i.d. bareMinerals cosmetics, particularly the core foundation products, offer a

highly differentiated, healthy and lightweight alternative to conventional liquid- or cream-based

cosmetics while providing light to maximum coverage for all skin types.

. As such, BARE believes its foundation products have broad appeal to women of all ages

including women who did not previously wear foundation before using i.d. bareMinerals.

Marketing

. BARE utilizes a distinctive marketing strategy and multi-channel distribution model consisting

of infomercials, home shopping television, specialty beauty retailers, company-owned boutiques

and spas and salons.

. This model has enabled BARE to increase brand awareness, consumer loyalty and market share

and achieve favorable operating margins.

. Bare Escentuals was the top-selling cosmetics brand company-wide at leading specialty beauty

retailers Sephora and Ulta during 2005.

. Over the last five fiscal years, BARE has increased net sales approximately 87.5% on a

compound annual basis, and during the fiscal year ended January 1, 2006, operating income was

29.8% of net sales

Growth Strategy

> Further penetrate each of multiple distribution channels.

o Wholesale.

o Retail. Intends to expand the base of company-owned boutiques and to grow infomercial sales.

As of July 2, 2006, operated 30 boutiques and reported average annual net sales of

$1,400 per square foot for the fiscal year ended January 1, 2006

> Cross-sell other products.

> Develop new product concepts

> Expand global presence. BARE currently believes that Japan, the United Kingdom, Germany,

France and South Korea represent the most significant market opportunities for expanding its

global presence.

Competition

. Competes with the major makeup and skin care companies which market many brands including

Avon, Bobbi Brown, Chanel, Clarins, Clinique, Estée Lauder, L'Oréal, Lancôme, M.A.C.,

Neutrogena, Shiseido and Smashbox, as well as many specialty players in the beauty industry.

. Also competes with several smaller mineral-based cosmetics brands.

Recapitalizations

$645mm in dividends paid to stockholders

. In June 2004 affiliates of Berkshire Partners LLC, JH Partners, LLC, a San Francisco-based

private equity firm, and members of management acquired a majority controlling interest in the

company.

. In the transaction, BARE incurred approximately $100.0 million of new indebtedness, raised

approximately $87.5 million of new equity financing and used $169.6 million to repurchase

outstanding shares of capital stock and fully vested options

. In February 2005, incurred approximately $224.5 million of new indebtedness, repaid a total of

$92.6 million of existing debt and paid a special dividend to stockholders of $122.4 million.

. In October 2005, incurred approximately $187.5 million of new indebtedness and paid a special

dividend to stockholders of $183.5 million.

. In June 2006, incurred approximately $331.6 million of new indebtedness and paid a special

dividend to stockholders of $340.4 million.

Use of IPO proceeds

. Repay debt

. After application of the net proceeds of this offering and the concurrent refinancing of a portion of debt,

BARE expects to have a total of $479.9 million in outstanding indebtedness.