1. JSC “latvijas balzams”: achievements 2012
Guntis Āboltiņš-Āboliņš, CEO
Valters Kaže, Brand Director

2. About Us #1 alcohol producer in the Baltics
>120 products and brands
>100 international awards
~70 m Bottles annually
LVL 67.7 m revenue in 2011
>600 employees
36 direct export markets
>160 export markets via SPI Group
24% market share in Latvia
57% market share among local producers

3. Unaudited Business Results 9m 2012
50,3 m (+8% vs 9m 2011)
Revenue (LVL)
32,4 m
Volume (litres)
+1% volume +8% revenue
Export growth (% vs 9m 2011)
2.5 m (+19% vs 9m 2011)
Unaudited profit (LVL)
26.3 m (including 18.3 m in excise tax)
Taxes paid (LVL)

4. Unaudited Business Results 9m 2012
REVENUES 9M 2012 AND 2011 TOTAL, LVL m
VOLUME REVENUES 9M 2012 AND 2011 TOTAL, m litres
REVENUES 9M 2012 AND 2011 BY MARKET, LVL m
VOLUME REVENUES 9M 2012 AND 2011 BY MARKET, m litres

5. In 2012 Company has invested LVL 310,000 in development
LB Investments in 2012
In 2012 Company has invested LVL 310,000 in development
New equipment for production of Stolichnaya
IT renovation and infrastructure
Filter housings
New equipment for packaging and corks
Other improvements
Investment in production and logistics
LVL 275,000
Design concepts
New recipes and technologies
Investment in new product development
LVL 35,000

6. Key Achievements in 2012 MARKET LEADING GROWTH
Sustainable market share in Latvia: 24% share retained despite harsh competition such as import growing by +28% year on year (9m 2012)
18 new products and packaging redesigns: focus on consumer insights driven portfolio management
Growing export volume: SPI Group exports to >160 countries as main source
PUBLIC RECOGNITION
Silver category in «Sustainability Index 2012»: a recognition to to our sustainable strategy and risk management
«Senior-Friendly Company“: awarded by Ministry of Wellfare and EC

7. NEW PRODUCT DEVELOPMENT

8. Grand Cavalier Exclusive
VODKAS AND INFUSIONS
STRONG VODKA «LB VODKA 69%»: FOR HOME-MADE INFUSION FANS
«LB INFUSION»: 3 INNOVATIVE COMPLEX FLAVOURS
«BALTA»: CLASSIC VODKA FOR LITHUANIAN MARKET
Grand Cavalier Exclusive
Brandy Aramis
Bonaparte Cinnamon

9. Grand Cavalier Exclusive
BRANDIES AND STRONG SPIRIT DRINKS
«BONAPARTE CINNAMON»: DELICATE BRANDY AND CINNAMON BLEND
«ARAMIS»: 5 YEARS AGED FRENCH BRANDY
«GRAND CAVALIER EXCLUSIVE»: #1 BRAND IN LITHUANIA + INNOVATIVE TECHNOLOGY + 8 YEARS AGED FRENCH BRANDY
Grand Cavalier Exclusive
Brandy Aramis
Bonaparte Cinnamon

10. Grand Cavalier Exclusive
LIQUEURS AND BITTERS
«ŠARLOTE»: MARKET LEADER REBORN IN A NEW QUALITY
«ŽOLYNŲ»: 23 NATURE-BORN INGREDIENTS TO RULE THEM ALL IN LITHUANIA
Grand Cavalier Exclusive
Brandy Aramis
Bonaparte Cinnamon

11. Grand Cavalier Exclusive
SPARKLING WINE AND FUSION
«RĪGAS DĪVA»: FUSION WINE DRINK FEATURING REAL FRUIT FRESHNESS
«RĪGAS JUBILEJAS» SPARKLING WINE: 60 YEARS OF CLASSIC TECHNOLOGY WITHIN CONTEMPORARY PACKAGING
Grand Cavalier Exclusive
Brandy Aramis
Bonaparte Cinnamon

12. Grand Cavalier Exclusive
CIDERS AND PREMIXES
«APPLE GARDEN»: DRY CIDER FOR A DEMANDING CONSUMER
NEW PREMIX FLAVOURS: FROM CLASSIC VALUES TO HOT THINGS...
Grand Cavalier Exclusive
Brandy Aramis
Bonaparte Cinnamon

13. Grand Cavalier Exclusive
DESIGN RELAUNCH FOR MOST-LOVED BRANDS
Grand Cavalier Exclusive
Brandy Aramis
Bonaparte Cinnamon

14. AND FINALLY...
HERE COMES
THE MOST INNOVATIVE PRODUCT OF

16. High quality vodka Combines centuries of Riga Black Balsam craftmanship with advanced technologies
The most pure form of vodka – secret hidden in:
Black Charcoal and Silver purification: unique silver-ionized charcoal applied
7 times filtered for the most pure taste
purest artesian well water (184m and 198m)
no suggar added – the most pristine taste
Highly competitive to top-notch vodka brands locally and globally
Widely available in stores from January, 2013

17. 0.35
0.5
0.7

18. INDUSTRY IN 2012 AND CHALLENGES AHEAD

19. Priorities for Industry 2012-2013
Pro-active and meaningful conversation with government started to combat illicit alcohol market in Latvia
Alcohol excise tax unchanged – secures stability and predictability of the licit business framework
More strict measures related to breach of alcohol regulation – age verification for young adult (18-25) consumers introduced
Productive collaboration with State Revenue Service and law enforcement bodies

20. 2013: The Challenges Ahead
Top priority: effectively combat illicit alcohol market in Latvia
More severe sentence for distribution of illicit alcohol
Pure alcohol contents based excise taxation legislative initiative
Real estate taxation incentives for the largest employers
Industry as a social partner in legislative decision making
Walk the talk: implementation of the National Development Plan

21. JSC “Latvijas balzams” Priorities in 2013
Further development of innovative and cost-effective technologies
Retention of top quality despite the increase of raw material costs
Growth of production volumes driven by economic recovery in world markets
Production and logistics
Competitive and profitable new products
Brand building for current brands
New product development
Grow in core markets and selectively enter new
Develop globally competitive product portfolio
Export
Responsible and moderate alcohol consumption education programs
Combat illicit alcohol market to tackle its social and economic impact
Reduce impact on environment by improving production processes
Corporate Social Responsibility