EU – Baltic States, Good for Business, Markets and Companies, Retail, Technology

In the third quarter of 2015, despite turbulent market conditions in the region, ELKO Group has continued to deliver strong business performance, strengthening its position within the market and progressing new courses of business.

“Despite challenging economic development in our main regions as well as considerable uncertainties in foreign currency markets, we have significantly strengthened our positions and are confidently looking for new opportunities in the future. As of now, we already have exceeded our annual profitability targets set at the beginning of the year. This proves that with long term vision and well optimized and managed business processes we can ensure path to even greater success in the future,” Svens Dinsdorfs, ELKO Group CEO, comments.

Combining appropriate pricing strategy with robust risk management policies has helped the Company to improve its gross profitability margin to 4.9% comparing with 3.3% during same period in prior year. Despite the overall IT market decrease in CIS region by 30% that is mainly influenced by low oil prices, Western sanctions in Russia and tough economic conditions in other CIS countries, ELKO Group has managed to overachieve the market as sales in CIS region the decreased just by 12%. At the same time, the Company strengthened its market presence in CEE region where the sales growth reached 40% that was mainly enhanced by successful cooperation with Lenovo and Apple.

To diversify available financing facilities, on October 14, 2015 ELKO Group successfully completed issue of bonds attracting additional financing in the amount of 8 million euros that further will be listed on Riga Stock Exchange. During November, the Company signed new financing facility agreement with its long-term financial partners Nordea Bank, SEB Bank and Swedbank for 63 million USD that refinanced existing syndicate facility. The signing of new facility agreements and ability to issue bonds indicates trust of capital markets in the Company’s continuous successful growth.

The profit for 9 months period is 15.9 million USD that is considerably above the prior year of 1.6 million USD as well as planned profit of 5.4 million USD. The year of 2015 the Company plans to finalize with profit of more than 20 million USD.

In 2016, ELKO Group is planning to continue strengthening its expertise and position in solutions sector, offering knowledge and experience in the acquisition and implementation of various technological solutions as well as continuing to expand its broadline business product portfolio.