Vilkyskiu Pienine

Earnings Release • Feb 28, 2019

The results of 12 months of 2018

VILKYŠKIŲ PIENINĖ AB GROUP

content

• Main Events during 12 months of 2018
• Main Financial Indicators
• Sales Revenue by Markets
• Sales Revenue by Products
• Consolidated statement of financial position
• Consolidated income statement
• Consolidated statement of cash flow
• About the Company
• Companies of the Group
• Short history of the Company
• Shareholders
• Share price data
• Contacts

Main Events in 12 months of 2018

Product news

• AB Vilkyškių pieninė introduced to market renewed product "Vilkyškių" line curd in new packaging. "Vilkyškių" 500 g curd differentiates itself with very comfortable packaging. The packaging can be opened and closed multiple times therefore the product remains fresh longer even if it is not consumed from the first time. The new product will allow the Company to occupy a larger local market share in the cottage cheese category.
• GymON product line was complemented by 2 new products: 100% pure, highly soluble protein suitable for both sport and daily nutritional enrichment. This product will extend not only product consumption situations, target audiences, but also marketing channels. A new tropical flavor was added to the blue line (cocktails with flavors). According to 2018 tastes, this taste is one of the most popular in both product updates and consumer choice."
• Drink yogurts of VILKYŠKIAI was complemented by new taste of black currants. Many people already like curd cheese of VILKYŠKIAI with black currants and now it will be possible to try combination of these rich and valuable Lithuanian berries with a mild yogurt!
• With regards to the changing customer expectations and flavour changes, we decided to soften the consistency of curd cheese of VILKYŠKIAI and make it more crumble. Also renewed package of VILKYŠKIAI curd cheese.
• Curd cheeses of ''Murr'' have been renewed and the pastel colors have been changed to more intense and bright.
• The Memel Blue cheese, which is made by the hands of the masters of Vilkyškių pieninė, was renewed with its expressive taste - now without lactose.

Achievements:

• The most significant event during 2018 Vilkyškių pieninė AB Group was awarded as "Lithuanian Export Prize 2017" winner. The Company was recognized as the most contributing to the growth of the economy and exports.
• The results of Lithuanian competition "Most Popular Product 2017" were published in 2018, in wich Vilkyškių pieninė AB was awarded in three dairy product categories. Vilkyškių curd spread with greenery in curd spread category, Vilkyškių strawberry drink yogurt 750 g in drink yogurt category and Memel Blue cheese 100 g in cheese with mould category. Experts confirmed that products marked with label "Most Popular Product 2017" are absulutely safe and high quality. The prizes are awarded to products that have the highest sales in supermarkets Maxima, IKI, RIMI and Norfa.
• On December 6, Vilkyškių Pieninė AB was announced the winner of the prestigious Golden Phoenix Award and won the "Culture of the Year" nomination for active cultural activities.

Certificates:

• 2018 Kelmės Pieninė AB Tauragė Division was certified according to the ISO 22000: 2005 / FSSC 22000 Certification Scheme.
• 2018 AB Modest re-certification audit according to the ISO 22000: 2005/FSSC 22000 Certification Scheme.
• 2018 Kelmės Pieninė AB Surveillance audit according to the ISO 22000: 2005/FSSC 22000 Certification Scheme.
• 2018 AB Vilkyškių Pieninė AB, Modest AB and Kelmės Pieninė AB Tauragė Division were certified for Halal.

Exhibitions

• In February the Company traditionally took part in the international exhibition of food industry "Gulfood 2018" in Dubai, The United Arab Emirates.
• In April, GymON protein products for atheletes were presented in the international sport exhibition in Germany, Frankfurt - FIBO 2018. GymON star Žydrūnas Savickas met with fans, GymON products were presented and tasted, new customer search was conducted.
• On May 8 10 Vilkyškių pieninė AB participated in exhibition "Food West Africa" for the first time. The company was searching for new partners during it.
• On May 16-18 for the fourth consecutive years in a row the company participated in the largest Asian food exhibition in Shanghai "SIAL China 2018". The main focus was on mozzarella cheese and milk/whey powder.
• On May 24 26, "Agrobalt", the traditional, taking place every second year exhibition was held. Vilkyškių pieninė AB presented well known to Lithuanina market Murr curd cheeses in it.
• On May 29 30 Vilkyškių pieninė AB participated in the exhibition in Amsterdam "PLMA's World of Private Label" for the first time.
• In June, Vilkyškių pieninė AB participated in exhibition Food Taipei 2018 in Taiwan for the first time. At the exhibition hosted meetings with current and future customers, mozzarella cheese was presented for new partners.
• On October 21-25, Vilkyškių pieninė AB participated in the one of the largest food exhibition - ''SIAL Paris 2018''.

Main financial indicators

	2014	2015	2016	2017	2018
Revenue, thousand EUR	109,660	84,445	90,490	113,939	103,176
EBITDA, thousand EUR	6,218	3,876	8,413	10,882	4,328
EBITDA margin (%)	5.7%	4.6%	9.3%	9.5%	4.2%
Net profit, thousand EUR	3,212	1,168	4,455	6,686	-101
Profit margin (%)	2.9%	1.4%	5.0%	5.9%	-0.1%
Quantity of purchased milk, t	253,947	237,065	243,633	249,992	267,785
Profit (loss) per share (EUR)	0.27	0.10	0.37	0.56	-0.01
Net financial debt, thousand EUR	16,181	22,215	30,308	28,097	27,823

Quantity of Purchased Milk, t Revenue, thousand EUR

EBITDA, thousand EUR

Net Profit (Loss), thousand EUR

Sales Revenue by Markets (Thousand EUR)

		2017	2018
Lithuania	24,891	22%	24,585	24%
European Union	63,531	56%	55,865	54%
Other countries	25,517 22%		22,726	22%
	113,939			103,176

Sales Revenue by Products (Thousand EUR)

		2017	2018
Fermented cheese	51,427	45%	41,213	40%
Cream	38,255	34%	34,726	34%
Whey products	5,105	4%	7,776	7%
Sour cream	1,999	2%	2,216	2%
Curd products	8,168	7%	8,238	8%			34 %
Yogurt	4,036	4%	4,073	4%	Curd products	8 %	Cream
Butter	1,884	2%	2,026	2%	Other income 3 %
Other income	3,065	2%	2,908	3%			Yogurt 4 %
Total income:	113,939		103,176		Sour cream 2 %	2018	Butter 2%
	Yogurt 4 %				Whey products 7 %
Other income 2 %			34 % Cream				40 %
							Fermented cheese
Sour cream 2 %		2017
Whey products 4 %
				45 %
Curd products	7 %	Butter 2%		Fermented cheese

Consolidated statement of financial position

Thousand EUR	2018.12.31	2017.12.31
Assets
Property, plant and equipment	51,310	54,447
Intangible assets	6,933	6,961
Long-term receivables	314	254
Non-current assets	58,557	61,662
Inventories	16,125	9,656
Trade and other receivables	7,404	8,491
Prepayments	720	1,005
Cash and cash equivalents	407	317
Current assets	24,656	19,469
Total assets	83,213	81,131
Equity
Share capital	3,463	3,463
Share premium	3,301	3,301
Reserves	2,579	5,105
Retained earnings	23,237	22,367
Total equity attributable to the shareholders of the	32,580	34,236
Company
Non-controlling interest	52	51
Total equity	32,632	34,287
Liabilities
Interest-bearing loans and lease liabilities	17,397	20,123
Derivative financial instruments	-	-
Government grants	5,829	5,686
Deferred tax liabilities	945	1,528
Non-current liabilities	24,171	27,337
Interest-bearing loans and lease liabilities	10,426	7,974
Current tax liabilities	-	121
Derivative financial instruments	-	118
Trade and other payables, including derivatives	15,984	11,294
Current liabilities	26,410	19,507
Total liabilities	50,581	46,844
Total equity and liabilities	83,213	81,131

Consolidated income statement

Thousand EUR	2018.01.01- 2018.12.31	2017.01.01- 2017.12.31	2018.10.01- 2018.12.31	2017.10.01- 2017.12.31
Revenue Cost of sales	103,176 -96,489	113,939 -97,451	27,011 -26,609	26,864 -25,550
Gross profit	6,687	16,488	402	1,314
Other operating income Distribution expenses Administrative expenses Other operating costs	326 -4,053 -2,506 -152	390 -4,087 -4,434 -244	86 -448 -545 -29	192 -650 -86 -133
Result from operating activities	302	8,113	-534	637
Finance income Finance costs	13 -999	27 -580	10 -297	3 -163
Net finance expenses	-986	-553	-287	-160
Profit before income tax	-684	7,560	-821	477
Income tax expense	583	-874	207	-67
Profit for the period	-101	6,686	-614	410
Attributable to: Shareholders of the Group Non-controlling interest	-102	6,680	-613 -1	407 3
Net profit (loss) for the year	1 -101	6 6,686	-614	410
Basic earnings per share (EUR)	-0.01	0.56	-0.05	0.03

Consolidated statement of cash flow

Thousand EUR	2018.01.01- 2018.12.31	2017.01.01- 2017.12.31
Cash flows from operating activities Profit for the year	-101	6,686
Adjustments: Depreciation of property, plant and equipment Amortization of intangible assets	4,633 32	3,118 81
Amortization and write down of grants Profit (loss) from disposal of property, plant and equipment	-639 -63 -21	-430 -34 -
Income tax expense Interest expenses, net	-583 986 4,244	874 553 10,848
Change in inventories Change in long-term receivables Change in trade and other receivables and	-6,473 321	718 88
prepayments Change in trade and other payables	1,430 4,631 4,153	-2,163 -177 9,314
Paid interest Paid profit tax Other financial expenses	-790 -40 -	-786 -13 -54
Net cash from operating activities	3,323	8,461
Cash flows from investing activities Acquisition of plant and equipment Acquisition of intangible assets Proceeds from sale of plant and equipment Acquisition of the subsidiary's shares Loans granted Loans repaid Interest received	-1,441 -4 69 - 791 -103 -	-7,004 -22 100 - 3,174 - -
Net cash flows used in investing activities	-688	-3,752
Cash flows from financing activities Loans received Repayment of borrowings Dividends paid Government grants received	4,257 -5,130 -1,672	5,345 -8,533 -1,433
Net cash flows from financing activities	-2,545	-4,621
Increase (decrease) in cash and cash equivalents Cash and cash equivalents at 1 January	90 317	88 229
Cash and cash equivalents at 31 December	407	317

Additional information

About the Company

Vilkyškių pieninė AB was established in 1993 m. On the 31th of December 2018 the Group had 934 employees The production of Diary products is the core of Group business Companys's share capital amounts to 3,45 million. Eur Shares issued by the Company have been included into the Official List of AB NASDAQ OMX Vilnius. Standards: ISO 22000:2005 and FSSC 22000

Companies of the Group

Vilkyškių pieninė AB

Parent Company Established in 1993

The production of cheese, cream, whey "Modest" AB

The subsidiary Company Established in 1992

The production of melted smoked cheese, cheese with mould, mozzarella, other kinds of cheese

Kelmės pieninė AB

The subsidiary Company Established in 1993

The production of fresh dairy products

Since 2018 production of dry products: whey and milk powder (in Taurage)

"Pieno logistika" AB

The subsidiary Company Established in 2013

Rental of buildings

Shareholders

Shareholder	Shares	Ownership interest
Swisspartners Versicherung AG Zweigniederlassung Österrreich	6.067.206	51%
Multi Asset Selection Fund	2.035.729	17 %
Other shareholders	3.840.065	32 %
Capital in total:	11.943.000	100 %

Other shareholders

32%

17% Multi Asset

Selection Fund

Swisspartners Versicherung AG Zweigniederlassung Österrreich

51%

vilkyškių pieninė ab share price variation and omx vilnius indexes comparing 2018 january - 2018 december

OMX Vilnius VLPIL

Vilkyškių pieninė AB

Vilkyškiai, Pagėgių sav. 277160980 tel. +370 441 55330 fax. +370 441 55242 info@vilvi.eu www.vilkyskiu.lt

Contacts Gintaras Bertašius Director General tel. +370 441 55330 gintaras.bertasius@vilvi.eu

Vilija Milaševičiutė Economics and Finance Director tel. +370 441 55102 vilija.milaseviciute@vilvi.eu