Beluga : Operating results of BELUGA GROUP for 2022

Key figures for the period:

· The company's overall sales +6.8%.

· The sales of the company's in-house brands 5.4%.

· The sales of imported brands +13.8%.

· WineLab: the number of outlets 1,300+, total sales +52.3%.

The company demonstrated strong positive dynamics in 2022 under conditions of instability and uncertainty. During the reporting period, the group's overall sales reached 18.7 million 9L cases, exceeding last year's record figure by 6.8%. This volume include 15.4 million 9L cases of the company's in-house brands, which grew +5.4% compared to the previous year, and 3.3 million 9L cases of imported brands, which rose on +13.8%.

The growth of brands in the premium segment and above continued. Sales drivers among the in-house products are Beluga (+36%), Orthodox (+25.3%), PARKA (+21.3%) and Arkhangelskaya (+12.6%) vodkas, Tiflis Treasure (+32.5%) and Golden Reserve (+7.2%) brandies, Beluga Hunting bitters (27.3%), Fox & Dogs whiskey (+55.4%), Green Baboon gin (+182.3%) and Devil's Island rum (+323.5%). The continued positive momentum of the in-house premium brands, especially the flagship ones, has a significant impact on the company's financial results and strengthens its position in a changing market. The highest growth among the imported brands was demonstrated by Barceló (+44%) and Plantation (+160.3%) rums, Noy cognac (+27%) and the collection of imported wines (+16%). In the mid-price segment, Russian Ice vodka (+32.9%) and Ardeli cognac (+9.6%) showed strong results. Following the diversification strategy, BELUGA GROUP continued to develop all segments of spirits and wines in 2022, introducing new products, expanding product lines, redesigning brands, as well as entering into new partnerships with foreign companies.

Several new in-house products have expanded the brand portfolio. Among them are cranberry flavors in the Belenkaya and PARKA vodka's collections, Arkhangelskaya on Pine Nuts, Arkhangelskaya Pepper with Northern honey, Myagkov Cherry and Cognac, Myagkov Lingonberry and Honey tinctures, Tiflis Treasure 8YO, Golden Reserve National Selection France, Golden Reserve National Selection Spain cognacs, Golden Reserve Apricot brandy, Devil's Island Dark Anejo aged rum, banana and blackcurrant Green Baboon gins, new limited edition premium wines Сabernet Sauvignon and Red Blend in Golubitskoe Estate Noble Selection range as well as Golubitskoe Estate petnats. The group's import portfolio also includes new brands: gin and single malt whiskey from France, whiskey from Scotland, Ireland and Japan, tequila from Mexico, amaretto from Italy, as well as wines from France, Italy, Austria and other products in demand among Russian consumers.

The development of beverage supermarket chain WineLab continued in 2022. The number of outlets for the period exceeded 1,350, thus, its scale increased by 35% over the year. Generally, new outlets were opened in Moscow, the Moscow region and Saint Petersburg. Sales volume increased by 52.3%, traffic by 37.1%, like-for-like sales by 8.3%, and the average ticket by 11.1%. The e-commerce represented in Russian alcohol market by click & collect system is growing: with sales in this format up 115% YoY, and the number of orders increased on 171%. Customers picked up more than 1.2 million online orders during this period. For the clients' convenience, the chain's products are also available to order on marketplaces and online delivery services SberMegaMarket, Wildberries, Yandex.Food, SberMarket and Delievery Club. The chain opened its first store in a pickup point format in November targeting consumers who place online orders via the chain's website or mobile app, as well as through partner marketplaces. In addition, WineLab has launched a points-based loyalty program that successfully complements the discount program, which counts over 5.9 million members. In late December, INFOLine news and analytical agency ranked WineLab among the leaders of FMCG chains' loyalty programs in Russia. The WineLab development will continue in 2023, as this business direction is one of the company's growth drivers according to the BELUGA GROUP strategy.

Moscow Exchange included ordinary shares of BELUGA GROUP PJSC in Level 1 quotation list of securities admitted to trading. Shares' inclusion in the highest Quotation List confirms the compliance of BELUGA GROUP with the strict requirements of the Exchange on the quality of information disclosure, as well as the high level of the corporate governance of the group. In addition, rating agency Expert RA has upgraded the credit rating of BELUGA GROUP to ruА+ with a stable outlook in April.

Financial results made it possible for the company to pay interim dividends for 1H2022 in the amount of RUB 150 per share before tax and for the 3Q 2022 - RUB 75. A total of RUB 1.996 bln or 88% of BELUGA GROUP's net consolidated profit under IFRS was distributed among shareholders for 1H2022, and RUB 968.1 million or 57% of net profit will be distributed for 3Q 2022. Moreover, the Board of Directors approved the company's new dividend policy in October. The change affected the amount of payments, increasing them from 25% to at least 50% of the consolidated net profit under IFRS for the year.

In an unstable 2022, BELUGA GROUP has demonstrated business resilience based on a strategy of broad diversification in both product and price segments, as well as a vertically integrated business model that allows controlling all stages of product creation and distribution. The team, having experience in the crisis management, acted promptly and accurately. In 2023, taking into account new growth opportunities, the group will continue to strengthen its position in the market, present products that are in demand in the country, enter into new partnerships, develop in-house WineLab retail chain, focusing on e-com. BELUGA GROUP remains a reliable supplier for customers, partners, retail chains, restaurants and traditional retailers. The company promptly responds to any changes, adapts to non-standard conditions and provides the usual high level of services.