VERY IMPRESSIVE HALF OF THE YEAR AND A VERY HIGH GROSS PROFIT MARGIN DESPITE CONSTANT MARKET DIFFICULTIES

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 excellent financial results in the first half of 2022. Revenues in the first half of 2022 exceeded USD 1.2 billion (nearly PLN 5.2 billion) and were 14% lower than those generated in the corresponding period of the previous year (USD 1.4 billion). The Group's net profit in the discussed period amounted to USD 27.1 million (PLN 115.9 million) compared to USD 30.2 million in the first half of 2021 (decrease by 10%). In the second quarter of 2022 alone, ASBIS generated USD 516.4 million (PLN 2.3 billion) in revenues and USD 11.1 million in net profit (PLN 48.6 million).

Both in the first half of the year and in the second quarter of 2022, the Group significantly improved its gross profit margin to the level of 8.35% and 9.35% respectively, from 6.68% and 6.94% a year earlier. The gross profit margin in Q2 was at a record level.

The Company's results are in line with the expectations and published financial forecasts for 2022. After the first half of the year, the level of realization of the upper range of the forecast at the level of revenues is 50% and 52% at the level of net profit. Group expects sales revenues in 2022 to be between USD 2.2 billion and USD 2.4 billion, while net profit after tax between USD 48 million and USD 52 million. 

OTHER IMPORTANT EVENTS:

• The largest ASBIS country in terms of sales was the very fast growing Kazakhstan, while the FSU countries still maintained the largest share in the Group's revenues (more than 51% in the 1H2022).
• Poland has become a permanent member among the 10 countries with the highest revenues in the Group, taking the 8th place with revenues of nearly USD 39,8 million in 1H2022 (an increase of 11.3% compared to the same period of last year).
• ASBIS has opened a new Apple iSpace store in Metro City Shopping Center in Batumi, Georgia. It is the 21st Apple store operated by ASBIS in the area of its operations.
• ASBIS is further expanding its operations, signing new and extending existing distribution agreements: ExaGrid, Pure Storage, Edgecore Networks.

“The second half of this year was influenced by the war in Ukraine. Despite this, we generated very good financial results, and our gross margin in Q2 this year reached a record high,” said Serhei Kostevitch, CEO of ASBIS Group. “We are now focusing on higher-margin products and services, including business services, whose share in our sales structure is systematically growing. We are also working on the diversification of our business, an example of which is the investment in EMBIO Diagnostics. The Company has just finalized and is introducing a breakthrough product B.EL.D., which, thanks to the use of biosensors, quickly and accurately diagnoses food safety, air and water quality and other environmental pollutants. The device can also be used for the rapid detection and diagnosis of SARS-CoV-2, which may be important for all of us nowadays..

”Serhei Kostevitch, added: “ASBIS, as announced, dynamically develops its activities in markets not affected by the war. Currently, Kazakhstan is the largest market in our sales structure, while Azerbaijan and Georgia are new markets in the TOP10. Armenia is also doing very well in terms of sales. All these markets are developing very dynamically and ASBIS has a very strong, dominant position in them. The level of realization of the upper range of our forecast is very high, taking into account the fact that the last quarter of the year is historically the best sales period in our industry. We believe that if the situation in Ukraine and neighbouring markets will not deteriorate, our forecast for 2022 is not threatened”. 

FINANCIAL RESULTS 

A summary of the financial results of the ASBIS Group in the first half of 2022 is presented in the tables below (presentation of the results in USD and in the table below in PLN). USD remains the official reporting currency of the Group.

DETAILED SALES DATA 

SALES BY REGION

The FSU and CEE regions traditionally account for the largest share of our revenues. This did not change in the first half of 2022, however, due to the ongoing war in Ukraine, revenues in the FSU region decreased by 17%, while sales in the CEE region remained virtually unchanged. The main reasons for lower sales were the war in Ukraine (which also affected neighbouring countries), high inflation and weaker demand.

Therefore, the share of some regions - e.g. the Central and Eastern Europe region - in the Company's total revenues for the first half of 2022 has changed compared to the corresponding period of 2021.The share of the Central and Eastern Europe region in the first half of 2022 increased to 26.10% from 22.50%. At the same time, the share of the FSU region decreased to 51.09% from 52.73%.

The share of the Middle East and Africa increased in the first half of 2022 to 14.71% from 11.87%.

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 decline in Ukraine was one of the highest. As a result, revenues in Ukraine decreased by 39.8% in H1 2022 compared to the corresponding period of 2021. Revenues generated on the Group's largest market so far - Russia - decreased by 55.1% in H1 2022 compared to the corresponding period 2021. On the other hand, the Company was able to significantly increase its sales in markets that were not directly affected by the war in Ukraine, such as Kazakhstan - currently the Group's largest market, where revenues increased by 45.6% compared to the first half of 2021.

Currently, the second largest ASBIS market is the United Arab Emirates with revenues of USD 134.5 million in the first half of 2022 (an increase of 25.8% year-on-year).

Poland recorded an increase in revenues in the first half of 2022 by 11.3% compared to the first half of 2021.

The countries with the highest sales growth in H1 2022 were:

• Georgia – increased by 68.9%
• Azerbaijan – increased by 54.2%
• Kazakhstan – increased by 45.6%
• Slovakia – increased by 27%.

In the 2Q 2022, the countries with the highest sales increases were as follows:

• Armenia - increased by 246.1%
• Azerbaijan - increased by 87.8%
• Georgia - increased by 85.7%
• Kazakhstan - increased by 49.7%
• United Arab Emirates - increased by 45.8%.

IN SOLIDARITY WITH UKRAINE 

In the first quarter of 2022, ASBIS, as a socially responsible company operating in Ukraine among other countries, launched a special humanitarian fund called #HelpUkraine Fund and allocated EUR 2 million to aid Ukraine. Under this fund, ASBIS provides humanitarian aid to the most needy cities, hospitals and centers in Ukraine. To date, the Group has delivered 20 fully equipped ambulances, ready for immediate aid, 10 means of transport and over 27,000 medical and first aid kits or 11,000 mattresses and blankets. In addition, humanitarian aid organized by ASBIS regularly arrives in Ukraine with technological products such as generators and power banks, and many other essentials, including food and industrial products.

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 in Belarus, 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}