1. Virginia Demographic Overview

2. Core topics  Key Demographic Information  General population overview and growth trends  Population by major municipalities  Population age breakdown  Consumption behavior  Population ethnicity breakdown  Consumption behavior  Household income/disposable income/GDP  Business climate and key economic factors  Core industry anchors (manufacturing, gov’t, education, financial, etc)  Unemployment  Tax implications of market  Legislative or regulatory environment  Any current or pending legislation that would affect the industry  Overall business “friendliness”

3.  Key Demographic Information: General Population  Virginia Ranks 12 th in Population and represents 2.56% of the USA population  64.6% of the population is between 18 and 65 years old  8.2% of the population is Hispanic Source: U.S. Census Bureau - http://quickfacts.census.gov/qfd/index.htmlhttp://quickfacts.census.gov/qfd/index.html Key Demographic Information

5. F LORIDA O VERVIEW Key Demographic Information Population by Sex/Age Male3,925,983 Female4,075,041 Under 181,853,677 18 & over6,147,347 20 - 24572,091 25 - 341,090,419 35 - 491,730,083 50 - 641,547,809 65 & over976,937 Ethnicity (2011) Non-Hispanic White64.50% Black or African American19.80% Hispanic or Latino (of any race)8.20% Asian5.80% American Indian and Alaska Native0.50% Ancestry (2010) German11.70% English10.70% Irish9.80% American9.70% Subsaharan African1.70%

6. Source: http://statchatva.org/2012/11/13/virginia-population-projections/ Key Demographic Information Virginia – Projected Population Change 2010 - 2020

7. Key Demographic Information

8.  Key Demographic Information: Personal Income  PER CAPITA PERSONAL INCOME  In 2011 Virginia had a per capita personal income (PCPI) of $46,107. This PCPI was 111 percent of the national average, $41,560. The 2011 PCPI reflected an increase of 4.5 percent from 2010. The 2010-2011 national change was 4.4 percent. In 2001 the PCPI of Virginia was $33,246. The 2001-2011 compound annual growth rate of PCPI was 3.3 percent. The compound annual growth rate for the nation was 2.9 percent.PCPI Key Demographic Information Source: U.S. Bureau of Economic Analysis - http://www.bea.gov/regional/reis/http://www.bea.gov/regional/reis/ Per Capita Personal Income, 2011 Per Capita Income as a Percent of the United States In 2011 Virginia had a total personal income (TPI) of $373,311,727*. In 2001 the TPI of Virginia was $239,314,590*.TPI * Note: Total personal income estimates are in thousands of dollars, not adjusted for inflation. TOTAL PERSONAL INCOME

9. Source: http://www2.census.gov/geo/maps/dc10_thematic/2010_Profile/2010_Profile_Map_Virginia.pdfhttp://www2.census.gov/geo/maps/dc10_thematic/2010_Profile/2010_Profile_Map_Virginia.pdf Key Demographic Information

10.  59.7% of working age Virginian’s are employed  The largest industry group is Education / Health Care at 21.1%  21.6% of working age Virginian’s work for the Government Business Climate and Key Economic Factors  Business climate and economic factors: Employment Source: U.S. Census Bureau – http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ACS_10_1YR_DP03&prodType=tablehttp://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ACS_10_1YR_DP03&prodType=table

11.  The Current Unemployment Rate for Virginia is 5.6% Business Climate and Key Economic Factors Source: U.S. Bureau of Labor Statistics - http://www.bls.gov/lau/home.htmhttp://www.bls.gov/lau/home.htm  Business climate and economic factors: Employment Associated Distributors coverage areas are Blue and Orange

12. Source: U.S. Bureau of Economic Analysis http://bea.gov/newsreleases/regional/gdp_state/gsp_glance.htmhttp://bea.gov/newsreleases/regional/gdp_state/gsp_glance.htm http://bea.gov/regional/bearfacts/action.cfm Business Climate and Key Economic Factors VirginiaUnited States GROSS DOMESTIC PRODUCT (GDP) BY STATE In 2011, Virginia current-dollar GDP was $428.9 billion and ranked 10th in the United States. In 2001, Virginia GDP was $280.1 billion and ranked 13th in the United States. In 2011, Virginia real GDP grew 0.3 percent; the 2010-2011 national change was 1.5 percent. The 2001-2011 compound annual growth rate for Virginia real GDP was 1.9 percent; the compound annual growth rate for the nation was 1.4 percent. GDP BY STATE FOR INDUSTRIES In 2011, the largest industry in Virginia was government. This industry accounted for 18.7 percent of Virginia GDP and had a 0.2 percent real decline. The second largest industry was professional, scientific, and technical services, which accounted for 14.1 percent of Virginia GDP and had 4.7 percent real growth. The largest contributor to real GDP growth in Virginia was professional, scientific, and technical services. This industry accounted for 0.64 percentage point of the total growth in real GDP. The second largest contributor was finance and insurance. This industry accounted for 0.27 percentage point of the total growth in real GDP.* * Note: The industry contributions, or sum thereof, may be larger than 100 percent (and the percentage points larger than the percent change) because growing and declining industries offset one another. Top Five State Industries as a percent of Total GDP, 2011 Finance and insurance Real estate and rental and leasing Professional, scientific, and technical services Health care and social assistance Government All others

13. Business Climate and Key Economic Factors  Business climate and economic factors: Taxation Sales of All Beverages, Fiscal Year 2012 ProductGallons(1)LitersTotal Gallons (%)Gross DollarsGross Sales (%) STATE STORE SALES Distilled Spirits9,947,62637,655,84397.2%$726,138,33199.0% Virginia Wine26,40699,9580.3%$1,517,3380.2% Vermouth34,531130,7140.3%$1,338,2400.2% Alcohol682570.0%$8,5680.0% Nonalcoholic Mixers226,698859,1652.2%$4,465,5790.6% Total10,235,59938,745,937100.0%$733,468,156100.0% DIRECT SALES FROM WHOLESALERS Wines ($0.40 liter) (2)23,987,75690,803,49013.3%$36,324,44445.4% Beer ($7.95 barrel) (3)156,512,582592,464,29386.7%$43,628,82554.6% Total180,500,338683,267,783100.0%$79,953,269100.0% NOTES: (1) Excludes miscellaneous records, nonbeverage and confiscated items. (2) Gross liter tax for wines after 12 percent allocated to ABC revenue (3) Malt beverage gallons are estimated. Gross tax is taken from the malt beverage tax listed in “Financial Results in Brief, Fiscal Year 2012” (this page). Source: Policy, Planning and Analysis (PPA) A Message from the Chairman and Chief Operating & Financial Officers of the VAABC We are pleased to present the Fiscal Year 2012 Annual Report for the Virginia Department of Alcoholic Beverage Control (ABC). These facts and figures represent a fourteenth consecutive record-breaking year for retail sales by our agency. In Fiscal Year 2012, we opened three new stores, relocated six, modernized six and expanded and modernized two. ABC operations returned record profits of $132 million to the Commonwealth of Virginia. The agency has contributed $1.7 billion dollars to the commonwealth in the last five years.

14. Business Climate and Key Economic Factors Source:  Business climate and economic factors: No issues currently in Virginia

15. Legal or Regulatory Environment Virginia Licenses and Licensing  ABC retail licenses (1) 17,483  New retail, wholesale and special-permit licenses 1,961  Licensed retail establishments 16,271  Private or corporate owners 12,766  Alcohol compliance rates for retail licensees (%) (2) 87.07  Average processing time for new retail applications (in days) (3) 80  One-day banquet and special-event licenses 17,770 (1) Inclusive of licenses for sale and consumption of beer and wine, mixed beverages, on- or off-premises. (2) FY 11 rate: 90.28 percent (3) FY 11: 90 days. ABC targets a 76-day average. Source: VAABC 2012 Annual Report