Product portfolio expansion contributes to ELKO's growth in flat market conditions

1–6/2017 highlights

•   Revenue 635 million USD (586 million EUR), up by 17% year-on-year

•   Gross profitability 5.1%, up by 0.4 percent points year-on-year

•   Gross profit 32.4 million USD (29.9 million EUR), up by 27% year-on-year

•   Net profit 5.2 million USD (4.8 million EUR), up by 21% year-on-year

The ELKO Group's revenue for the 6 months of 2017 increased significantly reaching 635 million USD (586 million EUR), compared with 542 million USD (485 million EUR) for the relevant period in 2016. During the last half-year, the product portfolio has significantly expanded, and new distribution areas have already been added to already existing distribution agreements. Thus, ELKO managed to grow faster than the market as a whole, with a turnover growth of 17% compared to the six months of the previous year.

Turnover breakdown by regions

CEE – up by 7.3%, reaching 274 million USD (253 million EUR)

CIS – up by 31.8%, reaching 313 million USD (289 million EUR)

Baltics – down by 2.1%, reaching 48 million USD (44 million EUR)

New brand identity

During the first half of 2017, ELKO went through a rebranding process by developing new positioning and visual identity of its brand. The new logo and the story behind it are the first visible evidence of how ELKO is integrated into the transformation of the industry, improving efficiency and ensuring sustainable development.

New markets - the Nordic countries and Poland

After the end of the reporting period, at the beginning of July 2017 the deal for acquisition of 85% shareholding in Swedish company Gandalf Distribution AB - one of the leading distributors of computer and peripheral products in Sweden, has been completed. Gandalf Distribution AB will be consolidated into ELKO Group starting from the 3rd quarter of 2017. ELKO has also taken first tentative steps in the Polish market by outsourcing a local sales team.

About ELKO

The ELKO Group is one of the region's largest distributors of IT products and solutions, representing 180 IT manufacturers, and providing a wide range of products and services to more than 7 000 retailers, local computer manufacturers, system integrators and enterprises within various sectors in 30 countries across Europe and Central Asia. The Group’s turnover in 2016 amounted to USD 1 460 million.

More information:

www.elkogroup.com

LinkedIn: https://www.linkedin.com/company/elko-group

Facebook: https://www.facebook.com/elkogroup/

Twitter: @ELKO_Group

         Janis Kirsis
         Head of Treasury
         ELKO Grupa AS
         4, Toma Street, Riga, LV-1003, Latvia
         + 371 6709 2357
         janis.kirsis@elkogroup.com