Steiner Leisure Ltd. (NasdaqGS: STNR) April 17, 2014 Guanrong (Rachel) Fu Marnie Georges Jing Feng (Jeffrey) Li

Agenda 2  Introduction  Company overview  Macroeconomic outlook and industry overview  Relevant stock market prospects  Financial analysis and projections  Valuation  Recommendation

Company Overview Founded in 1934 Worldwide provider and innovator in the fields of beauty, wellness, and education Employees: 7,318 Market Cap: $632 MM Industry Classification: Specialized Consumer Services Closing Price: $ Company Overview Macro Overview Market Prospects Financial Analysis Valuation Revenue by Segment Sources: Company 10-K filings, Capital IQ, Yahoo! Finance.

Business Overview: Spa Services Business Overview: Relaxing therapeutic spas featuring quality beauty and body treatments Practices through cruise-based and land-based hotel and standalone spas Cruise Ship Spa Performance: Provide services including almost all major cruise lines in North America By 2014, serve 156 cruise ships representing 18 cruise lines Exclusive rights to offer services and sell products 4 Company Overview Macro Overview Market Prospects Financial Analysis Valuation Sources: Company 10-K filings, Capital IQ, Yahoo! Finance.

Business Overview: Spa Services Land-based Spas: Hotel-based Spas: Offer services at 56 urban hotels in 16 countries Sizes from 625 ft. 2 to 32,000 ft. 2 Exclusive rights with Starwood Day Spa: Operates 5 day spas worldwide Similar services to hotel spas Licensed Spas Licensed one brand to Thailand-based hotel operator 5 Company Overview Macro Overview Market Prospects Financial Analysis Valuation Sources: Company 10-K filings, Capital IQ, Yahoo! Finance.

Risk Overview: Spa Services 6 Company Overview Macro Overview Market Prospects Financial Analysis Valuation Land-Based Spas Hospitality industry ties Responsible for own capital costs Increased competition from day spas Hotel contracts may expire Cruise Ship Spas Cruise ship industry ties Agreement for 7.2% revenue (33 ships) expires in 2014 — may renew Carnival & Royal Caribbean account for 128 of 156 ships Celebrity agreement terminated New agreements may increase payments to cruise lines Sources: Company 10-K filings, Capital IQ, Yahoo! Finance.

Business Overview: Laser Hair Removal Business Overview: Acquired Ideal Image Development Inc. in 2011 Provides non-invasive procedures for the removal of unwanted facial and body hair Current Performance: 58 new locations as of 2014 Operates 109 laser hair removal centers in 31 states and one center in Canada Franchises brand to 17 additional centers Potential Risks Capital costs for new centers May not find ideal locations for new centers Need specific medical personnel in high demand Company Overview Macro Overview Market Prospects Financial Analysis Valuation Sources: Company 10-K filings, Capital IQ, Yahoo! Finance.

Business Overview: Production Company Overview Macro Overview Market Prospects Financial Analysis Valuation Provides high-quality personal care products through cruise ship spas, land-based spas, Ideal Image centers, department stores, and e-commerce Generates 30% of STNR revenues Highly competitive market reliant on brand image Ingredients sourced from elite European manufacturers with high bargaining power Key Brands Bliss Elemis Jou La Thérapie Remède Steiner Sources: Company 10-K filings, Capital IQ, Yahoo! Finance.

Business Overview: Education Full-time and part-time programs in massage therapy, beauty and skin care Accredited by several industry boards Began in 1999 with expansion through acquisitions 4,663 students Potential Risks: Title IV Compliance issues Most students receive financial aid Accreditation and licensing requirements changing Company Overview Macro Overview Market Prospects Financial Analysis Valuation Sources: Company 10-K filings, Capital IQ, Yahoo! Finance.

Market Power Analysis 10 Steiner’s recent acquisition and industry trends provide new opportunities moving forward. StrengthsWeaknesses Ideal Image acquisition places strong foothold in new marketSerious substitutes available for products and services Contracts with major hotels and cruises builds brand imageDepends on a few large cruise and hotel clients Education segment provides competent employees for spa and hair removal businesses Necessary R&D expenditures to develop new products and services may prove unprofitable Ability to sell products at spas and additional outlets to build brand awareness Subject to consumer sentiment, disposable income OpportunitiesThreats Opening new Ideal Image hair removal centers can capture new clients in growing market Increased competition from day spas and other alternatives Aging population demands new treatments and servicesProducts may become irrelevant with consumer taste changes Further global and domestic expansion with new partnersHotels and cruises may terminate contracts at any time Increased international and domestic tourism raises exposure to spa services Title IV legislation may hurt school enrollment and accreditation Company Overview Macro Overview Market Prospects Financial Analysis Valuation Sources: Company 10-K filings, Capital IQ, Yahoo! Finance.

Spa Industry Drivers Increased affluence More baby boomers (39.0% of spa users) demanding anti-aging services Mature industry offering additional services and products Consumer tastes and preferences 11 Company Overview Macro Overview Market Prospects Financial Analysis Valuation Sources: 1. “Health and Wellness Spas” Report. IBISWorld. March Bureau of Labor Statistics’ Consumer Expenditure Survey. 3. “Cosmetology and Beauty Schools.” IBISWorld. May 2012

Steiner Segment Industries Cruise ShipsBeauty Product Sales Industry revenue CAGR of 7.5% to $7.2 billion by 2018 Marketing drives sales High R&D expenditures Low revenue volatility due to increasing global demand and aging consumers 12 Company Overview Macro Overview Market Prospects Financial Analysis Valuation 34.4% of all cruise destinations are in the Caribbean Safety concerns remain prominent Sources: 1. “Ocean Transportation.” IBISWorld. 2. “Cosmetic Manufacturing.” IBISWorld.

Steiner Segment Industries Hair Removal Services Growth among males and females Diversification of services and technology Health and Beauty Schools 4.0% CAGR through 2017 Accredited schools qualify for Title IV funding Licensing requirements ensure attractive career Growth from spas, medi- spas, and salons supporting increased enrollment 13 Company Overview Macro Overview Market Prospects Financial Analysis Valuation Sources: 1. “Cosmetology and Beauty Schools.” IBISWorld. 2. “Hair Removal Services.” IBISWorld.

Industry Attractiveness 14 Sources: 1. IBISWorld Industry Reports. 2. Global Spa and Wellness Summit. STNR operates in a competitive industry with high threats of substitutes and large opportunities for growth. Bargaining Power of Buyers Numerous options to secure similar services and products Specific hotel and cruise contracts can limit competition Bargaining Power of Suppliers Hotels and cruise ships could choose to terminate agreements Uses own products in spas Risks involving government and schools Entry of New Competitors High capital requirements Stringent regulations Brand loyalty and reputation Contractual agreements for years Rivalry Among Existing Competitors Numerous competitors in spa space Differentiation through new technologies, medical focus Threat of Substitutes Numerous product brands can replace products Many choices for personal care outside spas Limited choice on cruises HIGHMEDIUMLOWHIGH Company Overview Macro Overview Market Prospects Financial Analysis Valuation

Historical Prices 15 Company Overview Macro Overview Market Prospects Financial Analysis Valuation Though the stock price has increased for the past few years, recent concerns have surfaced in a lower stock price.

Financial Analysis 16 Company Overview Macro Overview Market Prospects Financial Analysis Valuation

Comparable Company Analysis 17 Company Overview Macro Overview Market Prospects Financial Analysis Valuation

Discount Rate Calculations and Forecasting 18 Company Overview Macro Overview Market Prospects Financial Analysis Valuation

DCF Analysis 19 Company Overview Macro Overview Market Prospects Financial Analysis Valuation

Current Valuation 20 Current Stock Price: $44.11 Our Valuation: $42.05 Company Overview Macro Overview Market Prospects Financial Analysis Valuation

Recommendation Future Outlook and Concerns Stabilized growth in these segments: education, spas, and laser hair removal New and continuing contracts with major hotel and cruise operators Increase cost efficiencies in the products segment 21 WATCH LIST Company Overview Macro Overview Market Prospects Financial Analysis Valuation