ASBIS AFTER THREE QUARTERS OF 2022: SOLID NET PROFIT EMANATING FROM STRONG GROSS PROFIT MARGINS, BUT THE GROUP DOES NOT GET RELAXED, IT INTENSELY DEVELOPS GROWTH AND PERSPECTIVE MARKETS

ASBISc Enterprises Plc, a leading Value-Added Distributor, developer and supplier of IT and IoT products, solutions and services in the growing markets of Europe, Middle East and Africa, despite the extremely difficult market environment, generated very good financial results both in the three quarters of this year and in the third quarter of 2022 stand-alone. Sales revenues for Q1-Q3 2022 amounted to over USD 1.9 billion (nearly PLN 8.5 billion), only 10% lower than those generated in the corresponding period of last year (USD 2.1 billion). The Group's net profit in the discussed period was practically at the last year's level and amounted to USD 47.2 million (PLN 294.2 million) compared to USD 48.4 million in Q1-Q3 2021, a decrease of only 2%. In the third quarter of 2022 stand-alone, ASBIS generated USD 698.7 million (PLN 3.3 billion) in revenues and USD 20.1 million in net profit (nearly PLN 96 million), which means that it was 10% higher than the one generated in the third quarter of 2021. This was the best result in third quarter ever.

Both in the third quarter and in the Q1-Q3 of 2022, the Group significantly improved its gross profit margin to the level of 8.01% and 8.23% respectively, from 7.37% and 6.91% a year earlier.

After the three quarters of 2022, the realization of the upper range of the financial forecast for 2022 is very high and amounts to 70% of revenues and 90% of net profit.

OTHER IMPORTANT EVENTS:

• The largest ASBIS country in terms of sales was the very fast growing Kazakhstan, while the FSU countries (almost 52% share) and Central and Eastern Europe countries (over 24% share) had the largest share in the Group's revenues.
• Poland is among the 10 countries with the highest revenues in the Group, taking the 8^th place with revenues of USD 59 million in Q1-Q3 2022 (an increase of nearly 13% compared to the same period of last year).
• The Company continuing its dividend policy, decided for an interim dividend for 2022 earnings at USD 0.20 per share. The record date to the interim dividend was set on November 17^th, 2022, and the payment date on December 1^st, 2022.
• ASBIS has opened two Apple stores under the name iSpace - in Batumi (Georgia) and in Almaty, the largest city in Kazakhstan. The Group is currently an Apple Authorized Distributor in 11 markets and manages 21 Apple stores.
• ASBIS continues to expand its operations and enter new segments, the last entered segment is physical protection and distribution of Milesight products.

“This year started very hard with the outbreak of the war in Ukraine, which adversely affected our three largest markets. However, we have swiftly executed our strategy and firstly focused on existing markets but which had not been our priority so far,” said Serhei Kostevitch, CEO of ASBIS Group. “The positive effects can be seen in our financial results after the first third quarters of this year, we are making up for the revenues lost by the war and significantly improving our profitability. We are currently focusing on the Central Asian markets - the most prospective for us and the most growing in terms of GDP growth. Kazakhstan is growing very dynamically and is already our largest market. We plan to further develop this region.”

Serhei Kostevitch, added: “We are also strengthening our product offering by entering new market segments, but we also intend to diversify our activities by investing in companies and projects from other sectors. The first was EMBIO Diagnostics, which recently completed its breakthrough B.EL.D. product. Thanks to the use of bio-sensors, it quickly and accurately diagnoses food safety, air and water quality and other environmental pollutants. More similar investments can be expected this year. We are also thinking about new markets. We have a very good cash position, which we want to use as much as possible to further build a strong, diversified Group.” 

FINANCIAL RESULTS

ASBIS generated very good financial results in the discussed period. The Group was able to largely compensate for the negative effects of the war in Ukraine by focusing on development and investments in non-conflict markets.

A summary of the financial results of the ASBIS Group in Q3 2022 and Q1-Q3 2022 is presented in the tables below (presentation of the results in USD and additionally, also in PLN for an overview). USD remains the official reporting currency of the Group.

FINANCIAL FORECAST 2022 REALIZATION 

After the first three quarters of 2022, realization of the upper range of the financial forecast for 2022 is very high and amounts to:

• 70% at the level of revenues;
• 90% at the level of net profit. 

According to the financial forecast for 2022 published on May 4, 2022, the Group expects that sales revenues in 2022 will be between USD 2.2 billion and USD 2.4 billion, while net profit after tax will be at the level of between USD 48 million and USD 52 million. 

DETAILED SALES DATA 

SALES BY REGION

The FSU and CEE regions traditionally account for the largest share of Group revenues. This has not changed neither in the third quarter of 2022 nor in the nine months of 2022. Due to the war in Ukraine, which also affected neighbouring countries, high inflation and lower demand, the FSU region's share decreased to 53.13% from 58.99% in Q3 2022 and to 51.84% from 54.84% in the nine months of 2022.

The sales results confirm that ASBIS was able to compensate for the lower sales in the FSU region with higher sales in other markets.

• sales in the Middle East and Africa significantly increased both in the third quarter of 2022 and in the nine months of 2022 by 61.3% and 23.3%, respectively, compared to the previous year.
• the share of Central and Eastern Europe increased both in the third quarter of 2022 and in the period of nine months of 2022 to 20.76% from 20.68% and to 24.15% from 21.89% respectively. 
  

SALES BY COUNTRY

Country-by-country analysis confirms that a significant drop in sales was recorded in the markets directly affected by the war in Ukraine. The activity in Ukraine was one of the most affected, however, it should be noted that in the third quarter of 2022, Ukraine generated very high sales, which were only 2% lower compared to the third quarter of 2021. 

The countries with the highest sales growth in 1-3Q 2022 were:

• Armenia – increased by 257.1%
• Azerbaijan – increased by 85.0%
• Kazakhstan – increased by 63.3%
• United Arab Emirates - increased by 42.8%.
• Slovakia – increased by 26.8%
• Poland – increased by 12.7%. 

In 3Q 2022, the countries with the highest sales increases were as follows:

• Armenia - increased by 824,0%
• Azerbaijan - increased by 156,4%
• Kazakhstan - increased by 98,2%
• Georgia - increased by 82,1%
• United Arab Emirates - increased by 75,4%.

For additional information, please contact:  

Iwona Mojsiuszko
8Sense Public Relations
Tel. +48 502 344 992
E-mail iwona.mojsiuszko@8sensepr.pl

^{About ASBISc Enterprises Plc} 

^{ASBIS Group is a leading Value Add Distributor, developer and provider of IT, IoT products, solutions and services to the markets of Europe, the Middle East and Africa (EMEA) with local operations in Central and Eastern Europe, the Baltic republics, the former Soviet Union, the Middle East and North Africa.} 

<sup>The business of ASBIS is based on three pillars:
1. Distribution of hardware and software for Client Computing and Data Centers, consumer electronics thru:
    a.   Retail chains and e-tailers
    b.   Resellers to small and medium business
    c.   Large enterprises.
2. Full stack in creation of world class products. From scientific research and development to design and engineering, firmware and software, production and marketing of IT and IoT products and solutions via own brands:
    a.      Aeno (small home appliances).
    b.     Canyon (smart watches, power banks, accessories for computers and mobile devices)
    c.     Perenio (IoT platform, IoT routers, applications and peripherals for smart office/ home, smart health).
    d.     Prestigio (smart devices and accessories, innovative solutions for business and education, etc.)
    e.     Lorgar (accessories for gaming and streaming)
3.     Complex solutions sales projects to large enterprises via extensive networks of System Integrators and Value Add Resellers.</sup> 

^{ASBIS was founded in 1990, since 1995 operates from Cyprus. Company has two master distribution centers located in the Czech Republic and in the United Arab Emirates, subsidiaries in 27 countries, more than 2,200 employees and about, 20 000 active customers in 56 countries worldwide. In 2021, the Group delivered sales of close to USD 3.1 billion.} 

^{The Company’s stock has been listed on the Warsaw Stock Exchange since October 2007 under the ticker symbol “ASB” (ASBIS).} 

^{For more news and information visit: www.asbis.com}