Management Commentary

Management Commentary

The year 2022 challenged the Ekspress Group in many ways, which is also being reflected in our annual report.
On February 24th, 2022, the world changed completely for many people across Europe. Russia's military aggression against Ukraine came as a shock to the entire developed world.
For media companies, in many ways, it marked the beginning of a whole new era.
Our publications had to learn a lot of things that had previously seemed remote and even impossible: how to cover the war in a country close to us, whether and where to draw the line in reporting the details of what is happening, how to protect journalists and which tools to give them in the new situation. Additionally, in all our media outlets, we learnt how to counteract the large-scale Russian propaganda, how to combat constant cyber-attacks and how to ensure the operational continuity of media outlets in times of a crisis, such as possible power cuts.
The Group's performance was impacted by the inflation rates and rising input costs, but the board has taken steps to relieve this impact. We have managed costs and, where necessary, implemented cost-cutting measures, without compromising on the delivery of quality content. These efforts have proved themselves to be successful: compared to last year, we achieved a 20% increase in revenues and an 8% increase in EBITDA. Digital revenues grew by 23% and already made up for 78% of the Group's total revenues by the end of last year.

Mari-Liis Rüütsalu
Chairman of the Management Board, Chief Executive Officer of the Group
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Despite the extremely unstable economic environment, the Group’s financial results for 2022 showed strong and stable growth. The revenue of AS Ekspress Grupp totalled EUR 64.1 million, increasing by 20% as compared to the previous year. EBITDA was EUR 8.9 million that is 8% more than in the previous year. The net profit totalled EUR 4.1 million which is at the same level as in 2021, but considering that the revenue for 2021 included one-off finance income in the amount of EUR 0.4 million for fair value adjustment of the future commitment related the purchase price of the ticket sales platform, the net profit increased by approximately 11% as compared to the year before.
We have raised prices due to inflation, but most importantly, we have succeeded in increasing the Group's market share in digital subscriptions, online advertising and other areas. The Group's media companies grew at the expense of their competitors in 2022 by offering advertising clients better solutions to reach consumers. The demand for the events offered through the Group’s ticket business platforms also picked up. The sales volumes of outdoor screens increased as the digital outdoor screen network was expanded by 27 new screens. By the end of 2022, the network already consisted of 84 digital outdoor screens which is 50% more than in the previous year. We continue to actively expand the outdoor screen network, especially in Latvia where the number of digital outdoor screens added in 2022 remained below expectations. In 2023, we will continue to install outdoor screens in the framework of the public tender of the City of Riga.

Signe Kukin
Member of the Management Board, Chief Financial Officer of the Group
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